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[ GR No. L-13273, Dec 29, 1959 ]



106 Phil. 844

[ G. R. No. L-13273, December 29, 1959 ]




Simeon Salvador filed on May 18, 1954 an action in the Court of  First  Instance of Rizal  to  recover  from Oscar Pajares, among others, the sum of P2,500.00, plus interest, representing the value of  extra labor and materials Salvador had used in the construction  of the house of Pajares. Salvador claimed that he  had  to  furnish extra labor and. materials because of the  changes  and alterations in the original plan and specifications which Pajares ordered in the course  of construction.

Pajares admitted that  the construction  had  deviated from the original plan and specifications but claimed that the changes  were  effected  at the instance  of Edilio L. Baluyot whom defendant claimed to be the real contractor. Alleging that Pajares  could  not demand full  remedy from Baluyot unless joined in  the case, Pajares  filed a third party complaint against Baluyot, which  was  in  due  time admitted over the opposition of plaintiff Salvador.

On August 5,  1955, the  trial court  rendered  decision the dispositive part of which reads:
"IN VIEW THEREOF, the Court renders judgment one in favor of the defendant and  third party plaintiff, Oscar Pajares  as against the plaintiff Simeon Salvador and the third-party defendant, Edilio L. Baluyot, for  them to pay the former, jointly and severally, the following amounts: P700.00 representing Pajares' expenses on the cement foundation; Pl,390.00 as reasonable expenses to complete the construction; P2,000.00  for attorney's fees of Atty. Victoriano Yamson; P5.00  daily for  failure to finish the house within the required period of time from July  28, 1953,  until the  house  is completed and a building  certificate   is issued  by the  City  Engineer's office of Quezon City; and F2,000.00 for both moral and  exemplary damages.   The complaint and the counterclaim of plaintiff  and  third-party  defendant, respectively,  are hereby ordered.  DISMISSED, with  costs against  both  plaintiff  and third-party  defendant."

On appeal, the Court of Appeals affirmed  in  toto  the decision of the trial  court.  Baluyot filed a petition  for review  which  was favorably  entertained by this  Court attributing several errors to the decision of the Court of Appeals.

Petitioner  assigns several errors as committed by  the Court of Appeals but those which deserve consideration for the purposes of this appeal may be reduced to the following: (a) in holding that the admission  of the third party complaint was proper;  (b)  in not holding that petitioner was unduly deprived of his full day in  court due to the  unwarranted and improper admission of the third party complaint; (c) in sustaining the trial court's judgment ordering  petitioner to pay respondent  the sum of  P700.00 representing  Pajares'  alleged  expenses on  the  cement foundation and the sum of P1,390.00 as reasonable expenses to complete the construction;  and (d)  in sustaining the trial court's award to respondent of  the attorney's fee in the sum of P2,000.00, exemplary and moral damages in the sum of P2,000.00, and the penalty of P5.00 a day  for the contractor's failure to complete the job within the stipulated period  of time.

The first  error cannot be entertained.  When Simeon Salvador filed a complaint against Oscar Pajares to  recover certain amount allegedly  for  extra  labor  and materials used  by him  in  the  construction of Pajares' house  and Pajares alleged in his answer that the real contractor was Baluyot and not Salvador who merely acted as his  dummy or alter ego, Pajares found it necessary to include Baluyot as party defendant in order that he  could press for trial all  the claims he may have against both Salvador  and Baluyot since Salvador deemed it wise  to bring the action in his own name without including Baluyot as co-plaintiff. Since there was only one contract involving the construction of Pajares' house, it  is evident  that  whatever claim Salvador may have against  Pajares  or the latter  against Baluyot will have to necessarily refer to the same contract which makes it convenient that it be threshed out in one and the same  case.  Pajares'  moved  to  have  Baluyot brought into the case as  party  defendant was therefore proper for its main  purpose  is to  avoid multiplicity of actions.  Consequently, the  trial court did not  but act correctly when it admitted the third  party complaint filed by  Pajares for only  in that way could all the questions pertaining to the construction of Pajares' house be threshed out jointly and not separately.

While under Section 1, Rule 12, of the Rules of Court a defendant who has a claim against a person not party to an action which has relation to  plaintiff's claim may file with  leave  of  court  against  such person a  pleading called a third party complaint, and that the test for determining the propriety  of the  admission of a third party complaint is that there must be a showing that such third party  is or might be liable  to  the defendant or to  the plaintiff for all  or part of the plaintiff's claim against the defendant, otherwise the remedy is not through a  third party  complaint but to file a separate  and independent action,  this  test is not exclusive when its  effect  would result  in  multiplicity of  actions.   Cases there are  where even if the action that may be taken against a third party defendant is unrelated to plaintiff's claim against the third party plaintiff or defendant,  if it appears that  the  third party is a necessary party to the case or one without whose intervention the real issue involved cannot be fully determined,  a  third  party complaint  has been allowed.   As a matter of fact,  our rules require that parties in interest without whom  no  final  determination can be had in an action be joined either as plaintiffs or defendants in order that all the issues  pertaining to  the controversy may be threshed out in a  single action with the end in view of avoiding multiplicity of suits  (Sections 7 and 8, Rule 3, of the Rules of  Court).   And in line with this premordial purpose, former Chief Justice Moran cites many instances where a third  party complaint  was allowed against  the third party  defendant  and the original plaintiff even if the third party  defendant's liability is based on a contract unrelated  to plaintiff's claim, for it has been aptly  said that the question whether a third party complaint should be admitted or not  is a matter that rests within the sound discretion  of the court (See, I Moran, Comments on  the Rules  of  Court, 1957  ed., pp. 192-197).   We  therefore find no error either on the part of the trial court or on the part of the Court of Appeals in bringing Baluyot as party to this case it appearing that he is the real contractor with whom  Pajares dealt with regard to the construction of his house.

There is also no merit in petitioner's contention that he was deprived of his day in court during the trial  of this case on  the  merits before the trial court.  The incident invoked  arose as  follows:  When  Pa j ares'  counsel was cross-examining  Salvador in  connection  with his  direct examination, his questions were objected to by Baluyot's counsel to which Pa j ares' counsel objected and the objection sustained by the trial court.   Such ruling which prevented Baluyot's counsel from objecting to the questions propounded by Pa j ares' counsel is now regarded by petitioner as having the  effect of depriving  him  of his day in  court.  In  our opinion,  the ruling was not entirely improper considering that it was the turn of Salvador to present his evidence against defendant Pa j ares and in line with the procedure that should be followed in the trial of a case, it was Salvador's counsel who was called upon to object if he so desired to the questions of Pa j ares' counsel although Baluyot's counsel may also intervene if so allowed by  the court in the use of its  discretion,  but such ruling cannot be considered  as having impaired  the  right of a party to  his day in court.   Much  less can be  said with regard to Baluyot as a  litigant because the record  shows that when  Pajares offered his evidence,  both oral and documentary as against  Baluyot, the latter or his counsel, was given the widest latitude in formulating objections to questions propounded to him during his examination and cross-examination.  The claim  of counsel  of Baluyot that he was deprived of his day in court is therefore untenable.

With regard to the claim that the Court of Appeals erred in sustaining the trial court's judgment ordering petitioner to pay respondent the sum of P700.00 representing Pajares alleged expenses on the cement foundation and the  sum of P1,390.00 as reasonable expenses to complete the construction, suffice it to  quote what the Court of Appeals says  on this point:
"In going over the evidence of record, we entertain no doubt that third party plaintiff Oscar Pajares is entitled to indemnity  or some sort of relief from third party defendant Edilio L. Baluyot who was the real contractor of the house of the former. It had been determined upon investigation conducted by Benjamin L. Abrantes, building inspector of the  office  of the city engineer of Quezon City, on request of plaintiff,  that  "the quality  of workmanship is poor in general judging by standard construction methods  and egineering practice. Connections  and joints  are  not properly constructed.   Some bolts connecting the posts to the straps  have not been tightened in place with nuts, windows  cannot be closed with ease and falsity because sashes are warped, indicating the use of unseasoned lumber.  Glazed tiles were used for the flooring of the  toilet and bath, which is unusual because unglazed type is more proper.  Cabinets are unfinished and the finishing of the building proper is roughly done.'  And it has further been determined by the commissioner who heard the parties that

'To complete the construction of the aforesaid house of Pajares, the following amounts have  to be spent: P30.00 for the  socale, it being only 80%  complete;  PI00.00 to smooth the exposed  woodwork, 50 work, 50% of  the same not being smoothed; P200.00  to put the posts on bearing and the framings in order; P500.00 to  replace the 2"  x 4" joints with those 2" x  5"  as called for in the  plan (Exh. 41-3 Pajares); P50.00 for the three-quarter moulding on the partitions:  P30.00  to repair the sagging  ceiling; P100.00 to replace twisted  windows  and doors; P80.00  to repair leading roof and gutters; and P300.00 to finish the  painting of the house which  is only half-done.  All  the  foregoing  expenses total P1,390.00 to which Pajares is  entitled against Baluyot.'"
Since the questions involved in this assignment of error are of fact which involve an evaluation of the evidence, they cannot be entertained by this Court in this appeal. The trial court's award of attorney's  fee in the sum of P2,000.00 and the  penalty of P5.00 a day for  the contractor's  failure  to complete  the job within the   stipulated period, we find  correct.   Because of petitioner's  failure to complete the job he bound himself to do through Salvador without any justifiable reason, Pajares was forced to bring this action and engage the services of a lawyer and it is but fair  that he  be  indemnified for  such  expenses.  For the same reason,  the penalty of  P5.00  a day  is proper because the same is expressly stipulated in the contract.

We believe, however, that the award regarding exemplary and moral damages in the sum of P2,000.00  is unjustified. There is no clear evidence  to show that  petitioner  has acted in bad faith or in "any wanton, fraudulent, reckless, oppressive or malevolent manner"  (Articles 2220, 2232, new Civil Code).  For  petitioner's  failure to do his job either personally or through his alter ego, the award for attorney's fees and for the penalty  agreed  upon in  the contract is more than sufficient as a retribution.   In this respect, the decision appealed from should  be modified.

Wherefore, with the modification that petitioner should not be made to pay moral and exemplary  damages in the amount of P2,000.00, the decision appealed from is affirmed, without  pronouncement as to costs.

Paras, C. J., Bengzon, Padilla, Labrador, Concepcion, Endencia, Barrera, and Gutierrez David, JJ., concur.