G.R. No. 101566 August 17, 1992
HON. FLORENCIO A. RUIZ, JR. SENT OF GOD FOUNDATION, INC. S OF G FOUNDATION INC., RAUL G. FORES, SENEN P. VALERO and FATHER ODON DE CASTRO,
petitioners,
vs.
COURT OF APPEALS, SPOUSES OLEGARIO ORBETA and SUSANA ROSARIO S. ORBETA, respondents.
Antonio P. Coronel for petitioners.
Eladio B. Samson for private respondents.
CRUZ, J.:
The petitioners fault the respondent court for reversing the dismissal of a complaint by the trial court and remanding the case for further proceedings. However, there is an important antecedent question we must first resolve before we can go to the merits of this case.
The facts relevant to this petition are briefly narrated.
On September 12, 1976, the Crisologo family donated an island to the Sent of God Foundation on the condition inter alia that it would "be used exclusively to provide a monastic life and experience according to the Rule of St. Benedict and for such other religious and charitable purposes as may be determined by the donee." This was followed by a later donation of other lands, under the same conditions. The subject properties were later transferred by the Foundation to the S of G Foundation Inc., which introduced improvements thereon that, for reasons we do not need to examine here, it later demolished. On July 29, 1988, believing that the conditions of the donations had been violated, the Crisologos filed a complaint for revocation of the donations and the recovery of the properties donated. 1 Impleaded as defendants were the Sent of God Foundation, the S of G Foundation, Inc., Raul G. Fores, Senen F. Valero, and Father Odon de Castro, the last three as officers of the foundations. Also included were Olegario Orbeta and his wife, Susana Rosario Orbeta, for their role in facilitating the donations.
In their answer, the first-named defendants resisted the allegations in the complaint and denied that the conditions of the donations had been violated. 2 For their part, the Orbeta spouses confessed judgment in their answer but also filed a cross-claim for damages against the other defendants for involving them in the litigation. 3
On December 5, 1988, the other defendants filed a motion to dismiss the complaint on the ground that it did not state a cause of action and that only the S of G Foundation was a real party-in-interest. A copy of the motion was furnished the Orbeta spouses. On January 2, 1989, the trial court issued an order 4
dismissing the complaint for lack of a cause of action. The cross-claim was also dismissed because it "had no more leg to stand on."
On January 12, 1989, the plaintiffs filed a motion for reconsideration, which was adopted by the Orbeta spouses in an urgent ex parte manifestation dated February 7, 1989. This motion was denied on February 8, 1989. The Crisologos then challenged the order of dismissal before the Court of Appeals in a petition for certiorari under Rule 65 of the Rules of Court. Docketed as CA-GR No. 16837, it was dismissed on May 2, 1989, on the ground that the proper remedy was an ordinary appeal. The appellate court stressed that "since the petitioner did not appeal from the questioned order of January 2, 1989, of respondent court dismissing the complaint, said, order had become final and executory." 5 This decision became final on May 25, 1989, and entry of judgment was made on July 11, 1989.
The Orbeta spouses, who had not joined the Crisologos in CA-GR No. 16837, filed their own petition for certiorari, also with the Court of Appeals. Docketed as CA-GR No. 17013, this petition prospered. On September 28, 1990, the respondent court annulled the dismissal of the complaint by the trial court and ordered its reinstatement. 6 Reconsideration of this decision was denied on August 27, 1991. The petitioners then came to this Court, raising several issues which, as will appear presently, are not decisive of this case.
The crucial question before us is whether the Orbeta spouses, as cross-claimants in the original complaint, could still appeal its dismissal in their petition for review.
We think not.
The most important reason is that the order of dismissal issued by the trial court had already become final and executory at the time it was sought to be reversed. The reglementary period for appealing it had already lapsed when the Crisologos filed their petition for certiorari under Rule 65. This was correctly dismissed by the Court of Appeals on the ground, as earlier stated, that the special civil action was not a substitute for a lost appeal.
When the Orbetas filed their own petition on March 6, 1989, it was also after the order they were questioning had already become unappealable. On this score alone, the present petition must fail. Even as the petition of the plaintiffs themselves had been earlier dismissed, similar treatment should have been given to the petition of the Orbetas, who were appealing only as cross-claimants.
A cross-claim is any claim by one party against a co-party arising out of the transaction or occurrence that is the subject matter either of the original action or of a counter-claim therein. Such cross-claim may include a claim that the party against whom it is asserted is or maybe liable to the cross-claimant for all or part of a claim asserted in the action against the cross-claimant. 7
The cross-claim in this case stemmed from the alleged unjust refusal of the donees to return the donated properties, resulting in the Crisologos filing their complaint for revocation of the donations. In their cross-claim, the Orbetas alleged that they were dragged into the controversy because of the conduct of the petitioners. Their contention was that they would not have been sued at all were it not for the failure of the petitioners to comply with the conditions of the donations.
It is clear that the cross-claim arose from the complaint of the Crisologos and was not separable from that main action. It had no independent existence and was based entirely on that complaint. The cross-claim was defensive in character because it could prosper only if the plaintiffs succeeded. As the plaintiffs failed to establish that the petitioners' refusal was not justified, it necessarily followed that the private respondents' own cross-claim, which was based on the same allegation, also had to fail.
In Torres v. Court of Appeals, 8 this Court declared:
In any event, even viewing the situation in the light most favorable to the Laicos, their cross-claim on Chivi's warranty to deliver title to them was so inextricably linked with and so utterly dependent upon the success of the complaint of the Sierras for the repurchase of the land that when the complaint was dismissed, the cross-claim could not possibly survive. For as the cross-claimants themselves alleged, the cross-defendants would be liable on the warranty "should the plaintiffs finally obtain favorable judgment in their favor" (sic). The warranty became functus oficio after the Sierras, who turned out after all to have a free patent title to the land issued way back in 1932, agreed to transfer and did transfer said title to the
Laicos — first by the deed of sale executed directly in their favor by the Sierras on January 17, 1960, and again in the amicable settlement of the case between them. The fact that the Laicos paid P10,000.00 to the Sierras in that amicable settlement created no liability on the part of the Chivis: first, because the latter neither knew nor consented to such settlement; second, because the Laicos had already acquired the land directly, from the Sierras by virtue of the aforesaid sale of January 17, 1960; and third because the said sum of P10,000.00 was not the subject of the cross-claim against them.
Apropos is the following statement of the legal principle:
A cross-bill strictly speaking is one brought by a defendant in an equity suit against . . . other defendants in the same suit, touching the matters in question in the original bill. It is considered as an auxiliary suit dependent upon the original bill, and can be sustained only on matters growing out of the original bill. There is a well-defined distinction between a cross-bill merely defensive in character, and one seeking affirmative relief. The dismissal of the original bill carries with it a purely defensive cross-bill but not one seeking affirmative relief. (Osius vs. Barton, 88 A.L.R. 394, 402)
The cross-claim in this case was purely defensive in nature. It arose entirely out of the complaint and could prosper only if the plaintiffs succeeded. Hence, under the principle above enunciated, it could not be the subject of independent adjudication once it lost the nexus upon which its life depended.
The cross-claimants cannot claim more rights than the plaintiffs themselves, on whose cause of action the cross-claim depended. The dismissal of the complaint divested the cross-claimants of whatever appealable interest they might have had before and also made the cross-claim itself no longer viable.
A party has an appealable interest only when his property may be diminished, his burdens increased or his rights prejudiced by the order sought to be reviewed. 9 In the case at bar, the consequence of the dismissal of the complaint was the cessation of the cross-claimants' exposure to injury, which risk would in fact have continued if the Crisologos' appeal had succeeded. It bears stressing that when the plaintiffs' petition was dismissed by the Court of Appeals, the cross-claim lost its basis, which was the dismissed complaint itself. Earlier, in fact, the dismissal of the cross-claim had already become unappealable when the order dismissing the complaint became final and executory.
It would be highly irregular to allow the reinstatement of the appeal lost by the plaintiffs through another appeal made by the cross-claimants. Not only was the cross-claim defensive in character and therefore deemed dismissed with the complaint but, as pointed out by the petitioners, the cross-claimants and the plaintiffs were supposed to be opposing parties and not in collusion with each other.
Our ruling is that the Orbetas, as cross-claimants, had no personality to pursue a remedy which properly belonged to the Crisologos who, through their fault or negligence; failed to employ it. Accordingly, the petition filed by the Orbetas should have been dismissed outright by the respondent court on the ground that the cross-claimants were not proper parties to appeal the dismissal of the complaint.
In view of the foregoing observations, the Court finds it unnecessary to resolve the issues raised by the herein petitioners in their assignment of errors.
WHEREFORE, the decision rendered by the respondent court on September 28, 1990, and its resolution dated August 27, 1991, are SET ASIDE and the dismissal of Civil Case No. 313-KC in the Regional Trial Court of Ilocos Sur is AFFIRMED. No. costs.
SO ORDERED.
Griño-Aquino and Medialdea, JJ., concur.
Bellosillo, J., took no part.
Footnotes
1 Rollo, pp. 77-86.
2 Rollo, pp. 110-118.
3 Rollo, pp. 139-149.
4 Rollo, pp. 155-159; penned by Judge Florencio A. Ruiz, Jr.
5 Original Records, pp. 149-151.
6 Rollo, pp. 28-37; decision penned by Bellosillo, J., with Marigomen and Mendoza, JJ., concurring.
7 Sec. 7, Rule 6 of the Rules of Court.
8 49 SCRA 67.
9 In Re Michigan, Ohio Bldg. Corp., C.C.A., III. 117 F. 2d 191, 193.
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