G.R. No. L-28486 September 10, 1981
FRANCISCO MAGNO, ET AL., petitioners, vs. THE COURT OF APPEALS, JUDGE MARIANO BENEDICTO of the Court of First Instance of Nueva Ecija and DONATO M. VERGARA, respondents.

FACTS

Petitioners obtained a final and executory judgment by default from the Court of First Instance (CFI) of Bulacan in a partition case concerning war damage payments. The judgment ordered private respondent Donato M. Vergara and another to pay petitioners jointly and severally. Upon issuance of a writ of execution and levy on his properties, Vergara filed an action for annulment of judgment before the CFI of Nueva Ecija. He alleged extrinsic fraud, claiming that petitioner Francisco Magno assured him he would be excluded from the Bulacan suit, thereby luring him into inaction. Vergara also sought a preliminary injunction to halt the execution. Petitioners moved to dismiss the annulment suit, arguing that the Nueva Ecija CFI, a court of coordinate jurisdiction, had no power to interfere with or nullify the final judgment of the Bulacan CFI. The Nueva Ecija judge deferred resolution of the motion to dismiss, opined that the allegations, if true, could constitute extrinsic fraud, and granted the preliminary injunction. The Court of Appeals upheld the Nueva Ecija court’s jurisdiction.

ISSUE

Whether the Court of First Instance of Nueva Ecija has jurisdiction to entertain an action to annul a final and executory judgment rendered by the Court of First Instance of Bulacan on the ground of extrinsic fraud.

RULING

Yes. The Supreme Court affirmed the Court of Appeals and upheld the jurisdiction of the Nueva Ecija CFI. The legal logic is anchored on the principle that an action for annulment of judgment based on extrinsic fraud constitutes a direct and independent attack against the judgment, with a cause of action entirely distinct from the original case. Citing precedents like Dulap vs. Court of Appeals, the Court ruled that there is no requirement for the venue of the annulment action to follow the venue of the original case. A court of first instance inherently possesses the authority to annul a judgment of another court of first instance if extrinsic fraud in its procurement is sufficiently alleged and proven. The Court examined the allegations hypothetically admitted in the motion to dismiss. Vergara’s claim that Francisco Magno assured him of exclusion from the suit, leading to his deliberate inaction, constitutes an allegation of extrinsic fraud—a fraudulent act committed outside the trial which prevented a party from presenting their case. These are ultimate facts which, if proven at trial, would justify annulment. The necessity for a full trial to establish these evidentiary facts was emphasized. The Court found petitioners’ second contention—that a hearing was unnecessary because the allegations were admitted in the motion to dismiss—to be fallacious. A motion to dismiss hypothetically admits the truth of the allegations only for the purpose of testing their legal sufficiency to state a cause of action; it does not dispense with the need for a trial to actually prove those facts. The case was remanded to the Nueva Ecija CFI for trial on the merits.