G.R. No. 26483 , December 24, 1926
SMITH, BELL & CO., ET AL., petitioners, vs. Honorable FRANCISCO SANTAMARIA, Judge of the twenty-third Judicial District, ET AL., respondents.

DOCTRINE:
1. Appealability of Insolvency Orders: An order determining the validity or priority of claims against an insolvent estate is appealable, regardless of whether it was issued during the hearing of an assignee’s account.
2. Scope of Record on Appeal: Courts should exercise caution in excluding matters from a record of appeal. The appellant, who bears the cost of printing, is generally the best judge of what documents are necessary for the proper presentation of arguments on appeal. Matters that may initially appear irrelevant could become pertinent during appellate arguments.
3. Finality of Orders & Motions for Reconsideration in Insolvency Proceedings: In ongoing insolvency proceedings, which remain under the court’s control, a motion for reconsideration of an order denying approval of a record of appeal filed beyond the typical reglementary period does not necessarily deprive the court of its inherent power to revoke or modify its prior interlocutory order to correct an error and allow an appeal.

FACTS

In the involuntary insolvency proceedings of Central Capiz, the Court of First Instance of Iloilo, presided by Judge Francisco Santamaria, issued an order on September 24, 1925. This order declared the claims of Antonio Belo, Jose Altavas, and spouses Timoteo Unson and Clara Lacson as preferred, but denied preference to the claims of Smith, Bell & Co., et al. (petitioners). The petitioners excepted to this order, filed a motion for new trial (which was denied), and gave notice of appeal. The court approved the appeal and fixed the bond.

On November 21, 1925, the petitioners presented their record of appeal. However, on December 8, 1925, Judge Santamaria issued an order denying its approval on two grounds: (a) that the September 24 order was not appealable since it was not made at a hearing of the assignee’s account, and (b) that the tendered record contained irrelevant matters. The petitioners excepted and gave notice of their intent to seek mandamus from the Supreme Court.

Subsequently, on January 2, 1926 (25 days after the December 8 order), the petitioners filed a motion for reconsideration. This motion was denied on July 9, 1926. A second motion for reconsideration was also denied. The petitioners then filed the present petition for mandamus with the Supreme Court on September 1, 1926, seeking to compel Judge Santamaria to approve and certify their record of appeal.

ISSUE

1. Whether the order of September 24, 1925, which determined the priority of claims in the insolvency proceedings, is appealable.
2. Whether the respondent judge acted with grave abuse of discretion in rejecting the record of appeal for containing allegedly irrelevant matters.
3. Whether the petitioners’ motion for reconsideration filed 25 days after the challenged order was filed out of time, thereby rendering the order final and precluding the grant of mandamus.

RULING

The Supreme Court GRANTED the petition for mandamus.

1. On the Appealability of the Order: The Court held that the respondent judge erred in ruling the September 24, 1925 order was not appealable. Citing its concurrent decision in *Urquijo, Zuloaga y Escubi vs. Unson*, the Court ruled that orders which determine the validity or priority of claims against an insolvent estate are appealable, irrespective of whether they are issued during the hearing of an assignee’s account.

2. On the Rejection of the Record of Appeal: The Court found that the judge also erred in rejecting the record for containing irrelevant matter. It emphasized that courts should be cautious in excluding documents from a record of appeal, as the appellantwho pays for the printingis unlikely to include wholly irrelevant material. Documents that may seem irrelevant at first could become important during appellate argument, especially in a case involving the relative preferences of multiple claims.

3. On the Timeliness of the Motion for Reconsideration: The Court rejected the respondents’ argument that the order of December 8, 1925, became final after 20-21 days and that the late motion for reconsideration (filed on the 25th day) was useless. The Court reasoned that the insolvency proceedings were still pending and under the court’s control when the motion was filed. Consequently, the court retained the inherent power to revoke its prior interlocutory order denying the approval of the record of appeal to correct an error and permit the appeal to proceed.

DISPOSITIVE PORTION:
The writ of mandamus is GRANTED. The respondent judge is ordered to approve and certify to the Supreme Court the record of appeal. Costs are taxed against the respondents Unson, Belo, and Altavas.