GR 155174; (August, 2009) (Digest)
G.R. No. 155174 ; August 4, 2009
D.M. CONSUNJI, INC., Petitioner, vs. DUVAZ CORPORATION, Respondent.
FACTS
Petitioner D.M. Consunji, Inc. (DMCI) and respondent Duvaz Corporation entered into a construction contract for the substructure of the Alfaro’s Peak building. The project was completed and accepted on October 31, 1997, with a one-year defect liability period. DMCI filed a collection suit against Duvaz for an unpaid balance. In its Answer, Duvaz interposed counterclaims for alleged construction defects and damages. Duvaz claimed that during the 1997 construction, it was discovered that the substructure of an adjacent building, The Peak—also previously built by DMCI—encroached onto the Alfaro’s Peak property, causing delays and requiring rectification. Duvaz further alleged damages from mal-execution and substandard work.
DMCI moved for summary judgment, arguing that Duvaz’s counterclaims had prescribed. DMCI contended that the defects liability periods for both The Peak (completed 1993) and Alfaro’s Peak (completed 1997) had lapsed. The Regional Trial Court denied the motion, finding that genuine issues necessitated a full trial. The Court of Appeals affirmed this denial.
ISSUE
Whether the trial court correctly denied the motion for summary judgment.
RULING
Yes, the denial was proper. Summary judgment is only warranted when there is no genuine issue as to any material fact. The Court found that Duvaz’s counterclaims presented genuine factual issues that required a trial. Duvaz’s allegations were not merely for breach of warranty against hidden defects, which might be subject to a specific prescriptive period. Instead, Duvaz essentially claimed that DMCI, in constructing the adjacent Peak project, caused actual damage to Duvaz’s property (the Alfaro’s Peak site) through encroachment and faulty work. This is a distinct cause of action for damages arising from alleged negligence or culpa aquiliana, the prescriptive period for which is four years from the discovery of the damage.
The determination of when Duvaz discovered the damage, the nature and extent of the alleged encroachment and defects, and DMCI’s potential liability for them are factual matters in dispute. The conflicting positions on estoppel, prescription, and the existence of damages precluded the rendition of a summary judgment. Any doubt regarding the propriety of summary judgment must be resolved against it. Therefore, a full-blown trial is necessary to ascertain the facts and resolve the parties’ conflicting claims. The Supreme Court affirmed the appellate court’s decision and remanded the case for trial on the merits.