G.R. No. 200671 , May 14, 2021
Philippine Savings Bank, Petitioner, vs. Amelita Hipolito, Alex Hipolito, and John Doe, Respondents.

FACTS

On March 1, 2002, respondents executed a Promissory Note with Chattel Mortgage in favor of Nissan Gallery – Ortigas for the purchase of a vehicle. The note was assigned to petitioner Philippine Savings Bank (PSB) on March 5, 2002. Respondents defaulted on their monthly amortizations starting February 10, 2004. After a demand letter was ignored, PSB filed a complaint for replevin and damages on August 6, 2004. The verification and certificate of non-forum shopping attached to the complaint was signed by Amelito Chavez, a PSB Senior Assistant Manager, pursuant to a notarized Authorization from Assistant Vice President Florencio P. Soneja. Respondents, in their Answer, contested the authority of Chavez to sign the verification and certificate. After respondents and their counsel failed to appear at the pretrial, the Metropolitan Trial Court (MeTC) declared them in default, allowed PSB to present evidence ex parte, and rendered a decision in favor of PSB, ordering respondents to pay the outstanding balance, penalties, liquidated damages, attorney’s fees, and costs. The Regional Trial Court (RTC) affirmed the MeTC decision. The Court of Appeals (CA) reversed the RTC, dismissing the complaint on the ground that PSB failed to prove that Soneja, as assistant vice president, had the authority to sue on behalf of the corporation or to delegate such authority to Chavez, as there was no showing of such authority in the corporate charter, by-laws, or a secretary’s certificate.

ISSUE

Whether the defects in the verification and certificate of non-forum shopping justify the dismissal of PSB’s complaint.

RULING

No. The petition is meritorious. The Supreme Court reversed the CA and reinstated the MeTC decision. The Court ruled that rules of procedure, such as those on verification and certificate of non-forum shopping, may be relaxed to serve substantial justice. Verification is a formal, not jurisdictional, requirement. While the general rule requires the certificate of non-forum shopping to be executed by a duly authorized corporate officer, an exception exists when the trial court has already decided the case on its merits. Dismissing the complaint based on the technical defect would result in re-litigation, further delay, and defeat the objective of preventing forum-shopping. The MeTC had already adjudicated the substantive merits of the case, finding respondents in default of their obligations. Respondents did not question the substantive correctness of the MeTC’s decision in their appeals. The Court also found no error in the MeTC proceeding with the ex parte presentation of evidence after respondents failed to appear at pretrial without adequate explanation. Thus, the interest of substantial justice warranted the reinstatement of the MeTC’s decision.