G.R. No. L-20350 June 30, 1966
THE DIRECTOR OF LANDS, petitioner and appellee, vs. NEMESIO ACANA, ET AL., claimants. HEIRS OF JUAN GONZALES, claimants and appellants, HILARION CASTIGADOR, claimant and appellee.

FACTS

Cadastral proceedings were opened for the Municipality of Lambunao, Iloilo. On January 18, 1962, the Court of First Instance of Iloilo issued an order of general default. On March 21, 1962, the heirs of Juan Gonzales, represented by Conrada Gonzales Lira, filed a motion to lift the order of default with respect to Lot No. 3170. They alleged they were the only claimants on record in the Bureau of Lands for that lot, that it was uncontested, that none of the heirs received a sketch card from the government surveyor regarding the lot, that Conrada G. Lira did not file an answer because she had no card and believed in good faith the lot was included among the sketch cards she received and filed, and that the lot had been in the actual physical possession of the heirs and their predecessors from time immemorial. Despite this motion, the trial court, through a designated Justice of the Peace, rendered a decision on March 27, 1962, adjudicating Lot No. 3170 to Hilarion Castigador. On April 6, 1962, the trial court denied the motion to lift the order of default, noting that a decision had already been rendered and that the motion was unaccompanied by other proper remedies. On April 11, 1962, the heirs of Juan Gonzales filed a motion to set aside the March 27 decision, attaching an affidavit of merit. The trial court denied this motion on May 28, 1962, finding no basis to set aside the judgment as the default order had not been lifted. The heirs of Juan Gonzales appealed.

ISSUE

Whether the trial court erred in not setting aside the order of default and the judgment by default and in not granting a new trial.

RULING

Yes, the trial court erred. The Supreme Court set aside the orders complained of and remanded the case to the trial court for further proceedings. The Court found the claim of the appellants meritorious. The motion to set aside the judgment alleged excusable negligence (failure to file an answer due to not receiving a sketch card from the government surveyor) and was accompanied by an affidavit of merit. The affidavit also interposed a meritorious defense, stating that the heirs had a meritorious claim over the lot as they were in actual, continuous, adverse possession for more than thirty years, paid land taxes, declared it in the name of their predecessor, and derived products from it. The Supreme Court held that the provisions of Sections 1 and 2, Rule 37 of the Rules of Court were duly complied with, and the trial court gravely abused its discretion in refusing to reopen the case.