G.R. No. 213421, August 24, 2020
UNIROCK CORPORATION, AS REPRESENTED BY EDISON U. OJERIO, PETITIONER, VS. ARMANDO C. CARPIO* AND HARDROCK AGGREGATES, INC., RESPONDENTS.

FACTS

This case originated from a resolved quieting of title case where Unirock was declared the owner of certain properties. During execution, the parties entered into a Memorandum of Agreement (MOA), approved by the RTC as a Compromise Judgment. The MOA granted Hardrock the exclusive right to quarry on the property in exchange for royalty payments to Unirock. Subsequently, a third party, Teresa Gonzales, filed a separate case claiming ownership over the same properties, leading the RTC in that case to order Hardrock to deposit royalties in escrow pending resolution.
Claiming Hardrock failed to pay royalties as agreed, Unirock filed a motion for a writ of execution to enforce the Compromise Judgment in the original case. Hardrock opposed, arguing the supervening third-party claim rendered execution unjust and that the MOA had been cancelled by the DENR Panel of Arbitrators. The RTC denied Unirock’s motion as premature, a ruling affirmed by the Court of Appeals, prompting Unirock’s petition to the Supreme Court.

ISSUE

Whether the Court of Appeals erred in affirming the denial of Unirock’s motion for a writ of execution of the Compromise Judgment based on the MOA.

RULING

The Supreme Court granted the petition, set aside the CA decision, and remanded the case to the RTC. The Court held that the CA and RTC erred in finding the motion for execution premature. A compromise agreement, once judicially approved, has the force of res judicata and is immediately executory. The proper remedy for a party alleging a breach is not to resist execution but to file an independent action for rescission, which Unirock had already done (though that case was dismissed on procedural grounds). The supervening third-party claim by Gonzales does not bar execution, as the MOA explicitly stated Hardrock acknowledged Unirock’s ownership based on a final Supreme Court decision. The DENR Panel of Arbitrators’ cancellation of the MOA was also irrelevant, as its jurisdiction is limited to mining disputes under the Mining Act and does not extend to nullifying contracts or compromising civil ownership rights settled by final judgment.
The Court found that Hardrock, by not denying the breach, effectively admitted it. Therefore, the fact of breach was established, and execution was in order. However, since the exact amount of unpaid royalties required evidentiary determination, the case was remanded to the RTC to conduct further proceedings solely to compute Hardrock’s monetary liability under the MOA.