G.R. No. 28815 , March 24, 1928
THE GOVERNMENT OF THE PHILIPPINE ISLANDS, plaintiff-appellee, vs. ANGELA MONTENEGRO and RAMON R. PAPA, defendants-appellants.

DOCTRINE:
A motion for a new trial on the ground of fraud in procuring a judgment by default is properly denied unless the movant proves both: (1) that the alleged fraud actually existed, and (2) that they have a good and meritorious defense to the action. Such a motion must be supported by affidavits of merit setting forth the facts constituting the defense in full. Failure to comply with this requirement warrants the denial of the motion.

FACTS

1. The Government of the Philippine Islands, through the Postal Savings Bank, filed an action to foreclose a mortgage executed by defendant Angela Montenegro with the consent of her husband, Ramon R. Papa.
2. The defendants were declared in default for failure to appear despite summons. The trial court initially granted a continuance upon the government’s motion, as the defendants promised to settle.
3. When the defendants again failed to appear at the rescheduled hearing, the court received the plaintiff’s evidence and rendered a decision ordering the foreclosure.
4. The defendants subsequently filed multiple motions to reopen the case and for a new trial. They claimed that representatives of the bank led them to believe a new mortgage would substitute the original, making their appearance unnecessary. They also asserted they had a “valid and legitimate defense” but deliberately refused to reveal it, stating that doing so would prejudice their interests.
5. Crucially, these motions were verified by oath but were not accompanied by an affidavit of merit detailing the facts of their alleged defense.
6. The trial court denied all motions. The defendants appealed, challenging only the denial of their motions for a new trial and not the validity of the mortgage debt itself.

ISSUE

Did the trial court err in denying the defendants’ motions for a new trial?

RULING

No, the trial court did not err. The Supreme Court affirmed the orders of the trial court.

The Court held that the established and elementary rule is that a motion for a new trial based on fraud (such as misleading representations by the adverse party) requires two showings: (a) the fraud actually existed, and (b) the movant has a good defense. Compliance with this rule is demonstrated by submitting affidavits of merit that fully set forth the facts upon which the defense rests. This practice is essential for the court to determine intelligently if reopening the case would serve a useful purpose.

In this case, the defendants failed to comply with this fundamental requirement. They deliberately withheld the facts of their alleged defense, leaving the trial court “entirely in the dark” as to its validity. Their mere assertion of having a defense, without any factual substantiation, was insufficient. Therefore, the trial court correctly denied their motions.

DISPOSITIVE PORTION:
“WHEREFORE, the orders appealed from are affirmed with triple costs in this instance against the defendant Angela Montenegro. So ordered.”

NOTES:
The Supreme Court imposed triple costs on defendant Angela Montenegro, deeming the appeal frivolous and taken solely for the purpose of delay, as the validity of the mortgage was not even contested, and their counsel was aware of the elementary rules they failed to follow.