G.R. No. 183528 ; February 23, 2011
PACIFIC UNION INSURANCE COMPANY, Petitioner, vs. CONCEPTS & SYSTEMS DEVELOPMENT, INCORPORATED and COURT OF APPEALS (FIFTEENTH DIVISION), Respondents.

FACTS

Concepts & Systems Development, Inc. (private respondent) entered into an Amended Construction Agreement with Pedro Perez for a condominium project. To secure down payments made to Perez, surety bonds were required. Petitioner Pacific Union Insurance Company issued Surety Bond No. 00054 G (16) 015342 and Performance Bond No. 00157 G (13) 015341 on March 19, 1997, to secure the payment and performance for Stage 3 of the project. Perez failed to complete the work. Private respondent filed a civil action for Breach of Contract and Damages against Perez, Philippine Phoenix Surety and Insurance Inc., and petitioner. The Regional Trial Court (RTC), Branch 58, Makati City, rendered a decision on February 17, 2007, in favor of private respondent, ordering petitioner to pay ₱12,271,948.24. Petitioner appealed to the Court of Appeals (CA). The RTC, in an Order dated July 10, 2007, granted the notice of appeal, explicitly finding that the “appeal docket fee therefor was paid within the reglementary period allowed by law.” However, the CA, in a Resolution dated May 7, 2008, dismissed petitioner’s appeal based on a report from its Judicial Records Division stating there was a failure to pay the docket and other legal fees. Petitioner moved for reconsideration, pleading financial hardship and offering to pay belatedly, but the CA denied the motion in a Resolution dated June 12, 2008. Petitioner then filed the instant petition for certiorari, arguing the CA committed grave abuse of discretion, and presented the RTC Order as proof that the docket fees had been paid.

ISSUE

Whether the Court of Appeals committed grave abuse of discretion in dismissing petitioner’s appeal for alleged non-payment of appellate docket fees, despite an RTC Order stating the fees were paid within the reglementary period.

RULING

Yes, the Court of Appeals committed grave abuse of discretion. The Supreme Court GRANTED the petition. While the right to appeal is a statutory privilege requiring compliance with rules, procedural lapses that do not impair the administration of justice call for a liberal construction of the rules to secure a just disposition. The dismissal was based solely on the absence of proof of payment in the records transmitted from the RTC. This lapse was inconsequential because the July 10, 2007 RTC Order constituted clear evidence that the docket fees were paid on time. The duty to transmit the proof of payment rests with the RTC clerk of court, and it is unjust to penalize the appellant for an error not of its making. The CA gravely abused its discretion by disregarding the RTC Order and giving premium to a mere technicality over the substantive right to be heard. The Supreme Court directed the CA to give due course to petitioner’s appeal upon submission of a copy of the official receipt or a certification from the RTC clerk of court confirming the payment and its details.