G.R. No. L-16371; March 28, 1961
ZAMBALES COLLEGES, INC., petitioner-appellant, vs. THE HON. COURT OF APPEALS, ETC., ET AL., respondents-appellees.

FACTS

Zambales Colleges, Inc. filed a suit for damages against Ciriaco Villanueva. In his answer, Villanueva set up a counterclaim with three causes of action: for damages arising from allegedly malicious criminal estafa cases filed against him (first and second causes), and for damages due to his scandalous arrest orchestrated by the college to humiliate him (third cause). The plaintiff college filed a motion to dismiss this counterclaim. The trial court denied this motion. The college, however, failed to file an answer to the counterclaim despite notice of the denial. Consequently, the trial court declared the college in default on the counterclaim, received evidence ex parte, and rendered a judgment awarding Villanueva substantial moral and exemplary damages and attorney’s fees on all three causes.
The college appealed the main judgment to the Court of Appeals. Meanwhile, the trial court, upon Villanueva’s motion, ordered execution of the judgment on the counterclaim. The college then filed an original action for certiorari and prohibition with the Court of Appeals to annul this execution order, but the appellate court denied the petition. The college elevated the matter to the Supreme Court.

ISSUE

The primary issue is whether the trial court committed a grave abuse of discretion in issuing a writ of execution on the default judgment for the counterclaim, and whether the declaration of default and the resulting judgment were valid.

RULING

The Supreme Court modified the decision of the Court of Appeals. The Court held that the trial court did not commit a grave abuse of discretion in ordering execution for the first and third causes of action of the counterclaim. A review of the trial court’s factual findings on these claims—such as the lack of merit in the criminal charges and the orchestrated timing and manner of Villanueva’s arrest designed to cause humiliation—showed no whimsical, arbitrary, or capricious error amounting to an excess of jurisdiction. A petition for certiorari cannot substitute for a lost appeal to correct errors of judgment.
However, the declaration of default and the consequent award for the second cause of action were null and void. The Court agreed with the petitioner that this cause of action was based on the same facts alleged in the college’s own complaint. Therefore, no answer was required from the college as to this specific claim, as the issues were already joined by the complaint. A default declaration under such circumstances is invalid. Since the college’s appeal on the main judgment was perfected, the award for the second cause of action remained appealable and could not be subject to immediate execution.
Finally, the Court rejected the argument that the filing of a motion to dismiss precluded a default, as such a motion is not a substitute for an answer once it is denied. The petitioner, by not filing an answer to the distinct issues in the first and third causes of action after its motion to dismiss was denied, was properly declared in default as to those claims. Its right to appeal the default judgment on those portions was lost due to its own negligence. Thus, execution was upheld only for the damages awarded under the first and third causes of action.