G.R. Nos. 149797-98; February 13, 2004
NANCY L. TY, petitioner vs. BANCO FILIPINO SAVINGS AND MORTGAGE BANK, COURT OF APPEALS and HON. PATERNO V. TAC-AN, in his capacity as the Presiding Judge of RTC Batangas City, Branch 84, respondents.

FACTS

Banco Filipino filed an action for reconveyance of real property against Nancy Ty and several other defendants (collectively, Tala, et al.). After procedural skirmishes, the trial court, presided by Judge Paterno V. Tac-an, issued a series of orders adverse to the defendants. These included an order granting Banco Filipino’s motion for production of documents without requiring it to advance costs, and a subsequent order declaring specific facts as established and striking out key defenses from Tala, et al.’s answer for their alleged failure to fully comply with the production order. The declared facts effectively pre-adjudicated core issues, such as Tala’s lack of financial capacity and the existence of a trust relationship in favor of Banco Filipino.
Petitioner Ty filed a petition for certiorari and prohibition with the Court of Appeals, seeking to annul these orders and to compel Judge Tac-an to inhibit himself from the case due to manifest bias and partiality. The Court of Appeals dismissed the petition, upholding the trial court’s orders. Ty elevated the case to the Supreme Court via a petition for review on certiorari.

ISSUE

Whether the Court of Appeals erred in not finding grave abuse of discretion on the part of the trial judge, whose collective actions demonstrated bias and prejudice warranting his inhibition from the case.

RULING

The Supreme Court granted the petition, reversed the Court of Appeals, and ordered Judge Tac-an to inhibit himself. The legal logic centers on the violation of due process arising from judicial bias. While a judge’s adverse rulings, standing alone, are not sufficient proof of bias, the collective and consistent pattern of the assailed orders in this case demonstrated a clear departure from judicial impartiality.
The Court found that the trial judge committed grave abuse of discretion by issuing orders that were not in accordance with procedural rules and that prematurely resolved the merits of the case. The order declaring facts as established and striking out defenses was a drastic sanction not justified by the circumstances, as it effectively decided the main issues of the case—financial capacity, ownership, and the existence of a trust—without a full trial. This, coupled with the order on document production which relieved Banco Filipino of its duty to advance costs, revealed an inordinate predisposition to rule in favor of one party. Taken together, these acts constituted clear and convincing proof of bias, showing the judge had lost “the cold neutrality of an impartial magistrate.” Consequently, to safeguard the fundamental right to due process, his inhibition was mandated. The case was ordered re-raffled to another judge.