G.R. No. 89431 ; April 25, 1990
ERIBERTO G. VALENCIA, petitioner, vs. HON. COURT OF APPEALS, HON. CARLOS C. OFILADA, Presiding Judge, Regional Trial Court, Bulacan, Branch XL, Third Judicial Region, Deputy Sheriff PABLO R. GLORIOSO, MIGUEL BUNYE and RICARDO BAGTAS, respondents.

FACTS

Petitioner Eriberto Valencia filed a case for rescission of a lease contract over a fishpond. During the pendency of the case, the lease expired and the private respondents, Miguel Bunye and Ricardo Bagtas, peacefully surrendered the property. Consequently, the trial court, in its November 29, 1988 decision, declared the prayer for rescission moot and academic, leaving only the issue of damages. The court awarded moral and exemplary damages totaling P150,000.00 to each defendant, plus attorney’s fees and costs against Valencia. Valencia received the decision on January 10, 1989, and filed a notice of appeal on January 16, 1989. The trial judge gave the notice of appeal due course and ordered the records forwarded to the Court of Appeals.
On January 17, 1989, before the expiration of the period for any party to appeal, private respondents filed a motion for execution pending appeal, offering to post a bond. Over Valencia’s opposition, the trial court granted the motion on March 6, 1989, conditioned on a P330,000.00 bond and allowed Valencia a period to file a counterbond. Valencia’s motion for reconsideration was denied. He then filed a petition for certiorari, prohibition, and mandamus with the Court of Appeals, arguing that the trial court lost jurisdiction upon perfection of his appeal and that the execution was improperly granted. The Court of Appeals dismissed his petition.

ISSUE

Whether the trial court acted with grave abuse of discretion in granting execution pending appeal.

RULING

Yes, the trial court committed grave abuse of discretion. The Supreme Court clarified that an appeal is perfected only upon the expiration of the last day to appeal by any party, not upon the mere filing of a notice of appeal. Since private respondents filed their motion for execution before the last day to appeal, the trial court retained jurisdiction to entertain it. However, jurisdiction to act does not equate to a correct exercise of discretion. The Court held that the grant of execution pending appeal under Rule 39, Section 2 requires the existence of “good reasons” to be stated in the order. The filing of a bond by the prevailing party, while a factor, is not by itself a sufficient “good reason.” The trial court’s orders failed to articulate any special, compelling, or superior circumstances demanding urgency, such as the debtor’s insolvency or a pressing need for relief, that would outweigh the potential injury to the appellant if the judgment is later reversed. The awards for moral damages, exemplary damages, and attorney’s fees are generally considered consequential and do not typically justify immediate execution absent such exceptional reasons. The trial court’s reliance solely on the posting of a bond constituted a capricious and whimsical exercise of power, amounting to grave abuse of discretion correctible by certiorari. The Supreme Court reversed the Court of Appeals, annulled the writ of execution, and made the temporary restraining order permanent.