G.R. No. 233135. December 05, 2018
B.E. SAN DIEGO, INC., PETITIONER, V. MANUEL A.S. BERNARDO, RESPONDENT.
FACTS
Petitioner B.E. San Diego, Inc. sold a parcel of land to respondent Manuel A.S. Bernardo on installment. Respondent defaulted on payments, prompting petitioner to file an action for cancellation of contract and restitution. The Regional Trial Court (RTC) dismissed the complaint, ruling petitioner failed to provide the 60-day grace period required by the Maceda Law. Petitioner, through new collaborating counsel, filed a motion for reconsideration without a notice of hearing. Counsel later sent a notice via mail, which the RTC found to be antedated. The RTC denied the motion as a mere scrap of paper and subsequently denied a belated notice of appeal, causing its earlier decision to become final. Petitioner then filed a petition for relief, arguing it should not be bound by its counsel’s gross negligence.
The RTC denied the petition for relief, a ruling affirmed by the Court of Appeals (CA). The CA upheld the strict application of procedural rules, finding that the negligence of counsel binds the client. Petitioner elevated the case to the Supreme Court via a petition for review on certiorari.
ISSUE
Whether the gross negligence of petitioner’s collaborating counsel justifies the relaxation of procedural rules to prevent a deprivation of property.
RULING
The Supreme Court granted the petition, reversing the CA. The general rule is that a client is bound by the negligence of counsel. However, a recognized exception exists when counsel’s negligence is so gross, reckless, and palpable that it violates the client’s right to due process. In this case, the collaborating counsel’s failure to attach a proper notice of hearing to the motion for reconsideration, coupled with the act of antedating a subsequent notice, constituted gross negligence. This directly caused the loss of petitioner’s right to appeal, resulting in the finality of an adverse judgment and a potential deprivation of property.
The Court found that petitioner exercised due diligence by monitoring the case and inquiring about the filed motion. Procedural rules are tools to secure, not override, substantial justice. A stringent application here would cause grave injustice by forfeiting petitioner’s property due to counsel’s incompetence, not the case’s merits. Following jurisprudence, the Court relaxed the technical rules to afford petitioner a full opportunity to prosecute its meritorious appeal. The case was remanded to the RTC for resolution on the merits.