G.R. No. 76209 May 4, 1989
REPUBLIC OF THE PHILIPPINES, petitioner, vs. THE HONORABLE COURT OF APPEALS and FIDELA DEL CASTILLO, married to EULALIO MISTICA, respondents.

FACTS

Private respondent Fidela Del Castillo filed an Amended Application for Registration of Title over three parcels of land in Meycauayan, Bulacan. The then Court of First Instance of Bulacan issued an Order dated June 21, 1977, granting the Republic, through the Office of the Solicitor General (OSG), fifteen days to file a written opposition. The OSG received this Order on June 27, 1977. The OSG filed its written opposition on July 15, 1977, which was three days beyond the computed deadline of July 12. Consequently, the trial court issued an Order dated July 19, 1977, declaring the Republic in default. The OSG filed a Motion to Set Aside the Order of Default, explaining the delay was due to awaiting reports from land agencies and constituted excusable negligence, and further argued the land was part of the unclassified forest region, placing it beyond commerce and outside the court’s jurisdiction.
The trial court denied the motion for reconsideration. On appeal, the Court of Appeals affirmed the default order. The appellate court reasoned that the 15-day period commenced on June 21, 1977, when an Assistant Provincial Fiscal was present in court and heard the order, making the opposition nine days late. The Republic elevated the case via petition for review on certiorari.

ISSUE

Whether the trial court and the Court of Appeals erred in denying the Motion to Set Aside the Order of Default.

RULING

The Supreme Court granted the petition, reversed the appellate decision, and ordered the trial court to proceed with the trial on the merits. The Court held that the Court of Appeals erred in computing the reglementary period from the date the Assistant Provincial Fiscal was present in court. The period must be reckoned from the actual receipt of the court order by the counsel of record, who was the Solicitor General. A Notice of Appearance filed by the OSG explicitly stated that only notices served on the Solicitor General would bind the government, clearly limiting the fiscal’s role. Thus, the period began on June 27, 1977, making the opposition only three days late.
More importantly, the Court emphasized that default judgments are not favored, and courts should be liberal in setting aside orders of default to afford parties a full opportunity to litigate their claims, especially to prevent a positive and considerable injustice. Technicalities should not be strictly enforced at the expense of due process. The delay was excusable, and the Republic possessed highly meritorious defenses, primarily that the land was classified as unclassified forest land, rendering it inalienable and beyond the court’s jurisdiction. No hearing on the merits had been held, and the applicant would suffer no real injury from lifting the default, whereas the government’s interest in protecting inalienable public domain was substantial. The case was remanded for trial.