G.R. No. L-29038 December 27, 1982
Alfredo C. Panlilio and Manuel L. Katigbak, petitioners-appellants, vs. Honorable Gregorio N. Garcia, Presiding Judge, Branch I, City Court of Manila, and American Machinery & Parts Manufacturing, Inc., respondents-appellees.

FACTS

Private respondent American Machinery filed a collection suit against petitioners in the City Court of Manila. Petitioners denied the claim, asserting they never purchased the tractor parts, received no invoices, and authorized no one to receive the goods. During trial, after the plaintiff rested its case, petitioners’ counsel moved for a continuance to present their evidence. The respondent judge orally denied the motion and, on the same day, rendered a decision against petitioners. Petitioners’ counsel received the decision copy on August 30, 1966, but failed to perfect an appeal on time, allegedly due to illness.
Petitioners subsequently filed a petition for relief from judgment in the Court of First Instance (CFI), which was dismissed for insufficiency in form and substance, specifically for lacking a proper affidavit of merit. Their motion for reconsideration was denied, with the CFI ruling the failure to appeal did not constitute excusable negligence, noting negligence of counsel’s secretary in informing him of the decision receipt is not excusable. This CFI order was appealed to the Court of Appeals, which dismissed the appeal for being filed 24 days late. Petitioners then filed a new action in another CFI branch to annul the City Court decision for alleged violation of due process.

ISSUE

Whether the Court of First Instance correctly dismissed the petition for annulment of the City Court’s decision.

RULING

Yes, the dismissal was proper. The Supreme Court upheld the lower court’s order, emphasizing the principle of finality of judgment and exhaustion of remedies. Petitioners had already availed themselves of and exhausted the specific statutory remedy of a petition for relief from judgment under Rule 38 of the Rules of Court. The CFI’s denial of that petition, which became final after the Court of Appeals dismissed the tardy appeal, constitutes a prior judgment that bars the subsequent annulment action. The legal logic is that a party cannot resort to an action for annulment of judgment as a substitute for a lost appeal or to re-litigate matters that could have been raised in earlier available proceedings.
Furthermore, the grounds for annulment—lack of jurisdiction, fraud, or a judgment contrary to law—were not sufficiently established. The City Court had clear jurisdiction over the collection suit. The petition did not allege any extrinsic fraud, and the claim of a due process violation from the denial of a continuance was a matter that should have been raised timely in the appeal or the petition for relief, not in a collateral attack via annulment. Thus, the Supreme Court found no merit in the petition and dismissed the appeal.