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[ GR Nos. 109430-43, Dec 28, 1994 ]



G.R. Nos. 109430-43


[ G.R. Nos. 109430-43, December 28, 1994 ]




Challenged in this petition for certiorari (with prayer for writ of preliminary injunction or temporary restraining order) is the resolution of public respondent Sandiganbayan (Second Division) dated 28 October 1992[1] which lifted its order of default of 6 April 1989 against private respondent Imelda R. Marcos in connection with the now well-known "ill-gotten wealth" cases pending before said court as well as the resolution of 6 January 1993[2] denying the motion to reconsider the order of 28 October 1992.

The Republic of the Philippines states assiduously that private respondent moved to regain her standing in court only on 8 July 1992, thereby incurring unreasonable delay, as demonstrated by the following circumstances: (a) The late Ferdinand E. Marcos died on 28 September 1989 and after his interment his widow, private respondent Imelda R. Marcos, was reasonably expected to regain her composure to enable her to attend to her cases; (b) She was exonerated in the racketeering case before the Southern District Court of New York on 2 July 1990 so that much of what public respondent considered as "abnormal burden" had "simply vanished or faded away;" and, (c) Upon her return to the Philippines in November 1991, she had every opportunity to personally take care of her cases being then fully aware of their pendency since 1987. From the moment she arrived, due diligence and reasonable promptness should have impelled her to take concrete steps in this regard; instead, she ran for the highest office of the land hoping that should she be successful in her bid all the cases against her would be rendered moot.

Petitioner likewise disputes the finding of the Sandiganbayan that private respondent has prima facie meritorious defenses. Petitioner further claims that res judicata has set in because the ruling in Imelda R. Marcos v. Presiding Justice Garchitorena,[3] has definitely settled the validity of the default order against private respondent.

We find no grave abuse in the exercise of public respondent's discretion under review.

First. Prefatorily, we shall resolve the claim of petitioner that the Imelda R. Marcos v. Presiding Justice Garchitorena cases have finally resolved the issue of whether the order of default was valid. It must be stressed that the resolution in said cases is conclusive only with respect to the default order for failure of the Marcoses to file their answer within sixty (60) days from 10 November 1988, the date the alias summonses were served. In other words, the central issue in those cases was whether there was valid service of summonses upon them in Hawaii.

In the case at bench, we are asked to rule on the propriety of the grounds and circumstances set forth by private respondent to justify her failure to file her answers, which the Sandiganbayan considered as meritorious when it lifted the default order on 28 October 1992. As the causes of action are different, res judicata cannot be invoked.

Second. Sec. 3, Rule 18, of the Rules of Court provides that "[a] party declared in default may at any time after discovery thereof and before judgment file a motion under oath to set aside the order of default upon proper showing that his failure to answer was due to fraud, accident, mistake or excusable neglect and that he has a meritorious defense x x x x" It is settled that whether the default order should be maintained under the circumstances attending a particular case, or whether it should be set aside, is addressed to the sound discretion of the trial court.[4] Absent any grave abuse, this Court will not interfere in the exercise of that discretion by the trial court. As a matter of fact, every presumption is in favor of the correctness of its action.[5]

While Sec. 3 of Rule 18 is explicit that the reglementary period for filing the motion to lift the order of default is at any time after discovery and before judgment, it is to the party's advantage that such motion is filed promptly and without unnecessary delay[6] because this is a factor taken into account in granting the prayer. In this regard, petitioner asserts that there was inordinate delay on the part of private respondent in filing her motion. Be that as it may, the records disclose that almost all of the "ill-gotten wealth" cases against private respondent and her family have not even reached the pre-trial stage such that no real injury against the interest of the State will result with the lifting of the default order. Besides, as will hereafter be shown, the peculiar circumstances of the present case justify the questioned resolutions of public respondent.

We agree with the ruling of the Sandiganbayan that the failure of private respondent to properly respond to the various complaints pending before it was due to fraud, accident and excusable neglect. At the time the complaints were instituted against private respondent, circumstances occurred which ordinary prudence could not have guarded against and by reason of which her rights were impaired. Thus, private respondent and her family were effectively barred by the government from returning to the Philippines. She was likewise burdened with numerous civil and criminal suits in the United States for alleged violation of the so-called RICO Act. Moreover, the deteriorating health of her husband aggravated the problems confronting her. Corollarily, the complexities of her legal battles necessitated extensive preparation but which she could not undertake as she was barred from coming back to the country. The claim of petitioner that she ran for the presidency for the purpose of rendering academic the cases against her in the event she succeeded is conjectural and speculative and deserves scant consideration.

Third. Equally important as the evidence on fraud, accident and excusable neglect is that private respondent has shown, prima facie at least according to public respondent, that she has meritorious defenses the tenability of which remains to be ascertained during the trial. The proffered defenses are: (a) She neither took advantage nor abused her late husband's position to acquire funds and other assets for her own personal benefit and aggrandizement; (b) Subject funds and assets were legally acquired by her and her husband using legitimately-sourced private funds; (c) Subject transactions were all entered at arm's length and did not, under any circumstances, cause prejudice nor damage to petitioner and the Filipino people; and, (d) Subject funds and assets were merely entrusted to the individuals and/or corporations concerned.

Fourth. Aside from the foregoing considerations, the most elementary sense of fairness and liberality appears to have prompted the Sandiganbayan to lift the order of default. Significantly, it is the avowed policy of the law to accord both parties every opportunity to pursue and defend their cases in the open and relegate technicality to the background in the interest of substantial justice. After all, petitioner had applied, on several occasions, for leave to file amended or expanded complaints which applications were invariably granted, notwithstanding the resulting delay. Perhaps, it is now the turn of private respondent to be the recipient of and enjoy the same procedural liberality if not compassion.

WHEREFORE, there being no grave abuse of discretion committed by public respondent Sandiganbayan (Second Division) in the issuance of the assailed resolution of 28 October 1992 lifting the order of default, as well as the resolution of 6 January 1993 denying the reconsideration thereof, the instant petition is DISMISSED.


Quiason and Kapunan, JJ., concur.
Padilla, J., (Chairman), see concurring opinion.
Davide, Jr., J., see dissenting opinion.

[1] Rollo, pp. 27-54.

[2] Id., pp. 55-60.

[3] G.R. Nos. 90110-43.

[4] Montinola, Jr. v. Republic Planters Bank, G.R. No. 66183, 4 May 1988, 161 SCRA 45; Claridad v. Santos, No. L-29594, 27 January 1993, 120 SCRA 148; Pacweld Steel Corporation v. Asian Steel Corporation, No. L-26325, 15 November 1982, 188 SCRA 229.

[5] lbid.

[6] See Philippine National Bank v. de Leon, G.R. No. 62370, 30 January 1990, 181 SCRA 583.