G.R. No. L-18831 January 30, 1965
CATALINA CAYETANO, plaintiff-appellee, vs. OSMUNDO CEGUERRA and FELINA SERRANO, defendants-appellants.

FACTS

Plaintiff Catalina Cayetano filed a complaint for foreclosure of a real estate mortgage against defendants-spouses Osmundo Ceguerra and Felina Serrana. The defendants, within the reglementary period, filed an Answer in the form of a letter admitting the mortgage debt but alleging that through the plaintiff’s machinations, they were unable to pay. Specifically, they claimed the loan was to be paid from the proceeds of a GSIS loan, which was held in abeyance, and that plaintiff refused to submit the title to the GSIS to facilitate the loan release. Despite this letter-answer, the defendants were declared in default for failure to file a responsive pleading, and the plaintiff was allowed to present evidence ex-parte. A decision was rendered in favor of the plaintiff. The defendants claimed they never actually knew of this decision as it was returned unclaimed. They learned of the judgment only upon service of a writ of execution on April 21, 1961. On June 17, 1961, they filed a Petition for Relief, which the trial court denied as filed beyond the reglementary period, counting from a registry notice received on January 13, 1961. The defendants moved for reconsideration, arguing the petition was filed within 60 days from their actual knowledge on April 21, 1961.

ISSUE

1. Whether the letter-answer filed by the defendants constituted a sufficient and responsive pleading.
2. Whether the Petition for Relief was filed within the reglementary period.

RULING

1. Yes. The Supreme Court held that the letter-answer, which contained a recital of facts relied upon as defenses, was a sufficient and substantial compliance with the rules. The Court advocated a liberal interpretation, noting that the defendants, who were not lawyers, should have been apprised if the answer was deemed non-responsive. Having filed an answer, they were entitled to notice of hearing. Their declaration in default and the subsequent ex-parte proceedings deprived them of their day in court, amounting to a lack of due process.
2. Yes. The Supreme Court ruled that the Petition for Relief was filed on time. The Court held that a petition for relief may be taken from an order of execution. Counting from the date defendants had actual knowledge of the order of execution (April 21, 1961) until the filing of the petition (June 17, 1961), only 57 days had elapsed, within the 60-day period. The Court found that the earlier registry notice did not justly attribute actual knowledge of the decision to the defendants, as there was no showing it indicated the contents pertained to the case.
The Orders denying the petition for relief and the motion for reconsideration were set aside. The case was remanded to the trial court for hearing on the merits.