GR 193840; (June, 2011) (Digest)
G.R. No. 193840 ; June 15, 2011
ALEXANDER S. GAISANO, Petitioner, vs. BENJAMIN C. AKOL, Respondent.
FACTS
Petitioner Alexander S. Gaisano assailed the November 24, 2009 Decision and August 23, 2010 Resolution of the Court of Appeals in CA-G.R. SP No. 02271-MIN, which reversed and set aside the June 24, 2008 Judgment of the Regional Trial Court (RTC), Branch 17 in Cagayan de Oro City dismissing respondent Benjamin C. Akol’s complaint for recovery of shares of stock in Civil Case No. 2006-010. On April 14, 2011, the parties jointly filed an “Agreement to Terminate Action” signed by them and their respective counsels. The agreement stated that the parties had agreed to amicably settle the case by terminating it, including the originating cases (Civil Case No. 2006-010 and CA-G.R. SP No. 02271-MIN), with both parties waiving any and all claims arising from or connected with these cases. The parties agreed to bear their own litigation expenses. The settlement was described as being for the sole purpose of buying peace, reestablishing goodwill, limiting legal expenses, and avoiding further protracted litigation, and not an admission of fault or liability.
ISSUE
Whether the “Agreement to Terminate Action” filed by the parties constitutes a valid compromise agreement upon which the Court can render judgment.
RULING
Yes. The Supreme Court approved the Agreement to Terminate Action and rendered judgment based on it. The Court ruled that a compromise agreement is a contract whereby the parties make reciprocal concessions to avoid litigation or put an end to one already commenced. Its validity depends on its fulfillment of the requisites and principles of contracts dictated by law, provided its terms are not contrary to law, morals, good customs, public policy, and public order. A scrutiny of the agreement revealed it is a compromise agreement sanctioned under Article 2028 of the Civil Code. Its terms and conditions were not contrary to law, morals, good customs, public policy, and public order. Therefore, judgment could be validly rendered thereon. The Court approved the agreement, rendering judgment based on it, which is final and immediately executory. The parties were enjoined to comply strictly and in good faith with its terms. Accordingly, Civil Case No. 2006-010 before the RTC was dismissed with prejudice. The pending Motion for Reconsideration with Motion to Admit Petition for Review on Certiorari was deemed moot and academic.