G.R. No. 151447 ; February 14, 2003
NEW SAMPAGUITA BUILDERS CONSTRUCTIONS, INC., et al., petitioners, vs. The Estate of FERMINA CANOSO, et al., respondents.

FACTS

Respondents filed a case for rescission of a contract of sale against petitioners. The parties reached an amicable settlement and filed a Joint Motion to Dismiss, incorporating the terms of their compromise agreement. Instead of praying for the court’s approval of the compromise, they prayed for the dismissal of the case. The Regional Trial Court (RTC) granted the motion and dismissed the case in an Order dated July 6, 1999. Subsequently, respondents filed a motion to enforce the compromise agreement, alleging petitioners violated its terms. The RTC granted this motion in open court and ordered the issuance of a writ of execution in its May 24, 2000 Order.
Petitioners moved for reconsideration of the May 24 Order, which the RTC denied. Petitioners then filed a petition for certiorari before the Court of Appeals (CA), docketed as CA-G.R. No. 60916, challenging the May 24 Order. While this petition was pending, respondents filed an Ex-Parte Manifestation with the RTC, stating that their true intention was for the court to approve the compromise, not to dismiss the case. The RTC, realizing it had never approved the compromise, issued an October 26, 2000 Order setting aside its own May 24 Order. Respondents then filed their own petition for certiorari with the CA, docketed as CA-G.R. No. 62672, challenging the October 26 Order.

ISSUE

Whether the Regional Trial Court retained jurisdiction to issue the October 26, 2000 Order setting aside its May 24, 2000 Order after petitioners had elevated the May 24 Order to the Court of Appeals via a petition for certiorari.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals. The RTC lost jurisdiction to reconsider or alter its May 24, 2000 Order once petitioners elevated it to the CA through a petition for certiorari. The filing of the petition for certiorari divested the RTC of jurisdiction over the same subject matter, as the CA had acquired appellate jurisdiction to rule on the propriety of the May 24 Order. The RTC’s act of issuing the October 26 Order, which effectively reversed the very order under review by the CA, constituted an improper interference with the proceedings of the appellate court. The proper course of action for the RTC judge, upon realizing a potential error, was to make a proper manifestation before the CA, not to issue a new order correcting himself. Therefore, the CA correctly set aside the October 26, 2000 Order for having been issued without jurisdiction.