"x x x.
Issue
For our resolution is whether the appellate court was in error when it dismissed petitioners’ Petition for Certiorari on the ground that appeal was the appropriate remedy under Rule 41 of the 1997 Revised Rules of Civil Procedure, and not a Petition for Certiorari, under Rule 65 thereof.
The Court’s Ruling
At the outset, attention must be called to Section 1, Rule 41 of the 1997 Revised Rules of Civil Procedure, to wit:
SECTION 1. Subject of appeal. – An appeal may be taken from a judgment or final order that completely disposes of the case, or of a particular matter therein when declared by these Rules to be appealable:
No appeal may be taken from:
(a) An order denying a motion for new trial or reconsideration;
(b) An order denying a petition for relief or any similar motion seeking relief from judgment;
(c) An interlocutory order;
(d) An order disallowing or dismissing an appeal;
(e) An order denying a motion to set aside a judgment by consent, confession or compromise on the ground of fraud, mistake or duress, or any other ground vitiating consent;
(f) An order of execution;
(g) A judgment or final order for or against one or more of several parties or in separate claims, counterclaims, cross-claims and third-party complaints, while the main case is pending, unless the court allows an appeal therefrom; and
(h) An order dismissing an action without prejudice;
In all the above instances where the judgment or final order is not appealable, the aggrieved party may file an appropriate special civil action under Rule 65.
From the foregoing, it is evident that under Section 1(h), Rule 41, no appeal may be taken from an order dismissing an action without prejudice. In such a case, the 1997 Revised Rules of Civil Procedure states that the remedy available to the aggrieved party is to file an appropriate special civil action under Rule 65.
Jurisprudence has similarly underscored that with the advent of the 1997 Revised Rules of Civil Procedure, an order of dismissal without prejudice is no longer appealable, as expressly provided by Section 1(h), Rule 41 thereof. In Philippine Export and Foreign Loan Guarantee Corporation v. Philippine Infrastructures, Inc.,[36] this Court had the opportunity to resolve whether an order dismissing a petition without prejudice should be appealed by way of ordinary appeal, petition for review on certiorari or a petition for certiorari. The Court said that, indeed, prior to the 1997 Revised Rules of Civil Procedure, an order dismissing an action may be appealed by ordinary appeal.[37] Verily, Section 1, Rule 41 of the 1997 Revised Rules of Civil Procedure recites the instances when appeal may not be taken, specifically, in case of an order dismissing an actionwithout prejudice, in which case, the remedy available to the aggrieved party is Rule 65.
Thus, the question is: was the Order of the RTC , dated 7 May 1998 , reviving the 9 January 1998 Order, which dismissed the Complaint, an order dismissing an action without prejudice?
We distinguish a dismissal with prejudice from a dismissal without prejudice. The former disallows and bars the refiling of the complaint; whereas, the same cannot be said of a dismissal without prejudice.[38] Likewise, where the law permits, a dismissal with prejudice is subject to the right of appeal.[39]
To resolve the issue before us, it is critical to examine the Order of dismissal rendered by the court a quo. It can be recalled that on 9 January 1998 , the trial court issued an Order dismissing petitioners’ Complaint, on the ground that petitioners Gamolo and Molo had not shown their authority to sue for and in behalf of petitioner Strongworld. Subsequently, on petitioners’ Motion for Reconsideration, the RTC reconsidered its 9 January 1998 Order of dismissal. Hence, on 30 March 1998 , the RTC ordered the case reinstated. However, on 7 May 1998 , upon Motion for Reconsideration of private respondent First People’s Bank, the court a quo recalled the Order of 30 March 1998 . The recall by the court a quo of the Order dated 30 March 1998 reinstated the Order dated 9 January 1998 , which dismissed the Complaint. Finally, on 17 July 1998 , the court a quo, upon petitioners’ Motion for Clarification, enunciated that the Order of 7 May 1998 , dismissing the case, is sustained.
As can be gleaned therefrom, the trial court’s order of dismissal of 9 January 1998 , was founded on the ground that the action was not instituted by the proper party in interest.[40] The trial court held that petitioners Gamolo and Molo, although admittedly officers of petitioner Strongworld, appear to have instituted the action for and in behalf of petitioner Strongworld, yet, their authority to sue or defend the corporation had not been shown in the Complaint.[41] No board resolution for the purpose had been attached or recited in the Complaint.[42]
Jurisprudence states that if the suit is not brought in the name of, or against, the real party in interest, a Motion to Dismiss may be filed on the ground that the Complaint states no cause of action.[43] Section 1(g), Rule 16 of the 1997 Revised Rules of Civil Procedure allows the filing of a Motion to Dismiss on the ground that the Complaint states no cause of action. Thus, in Aguila, Jr. v. Court of Appeals,[44] we pronounced:
A real party in interest is one who would be benefited or injured by the judgment, or who is entitled to the avails of the suit. This ruling is now embodied in Rule 3, Section 2 of the 1997 Revised Rules of Civil Procedure. Any decision rendered against a person who is not a real party in interest in the case cannot be executed. Hence, a complaint filed against such a person should be dismissed for failure to state a cause of action.[45]
Section 1, Rule 16 of the 1997 Revised Rules of Civil Procedure enumerates the grounds for which a Motion to Dismiss may be filed, viz.:
SECTION 1. Grounds. – Within the time for but before filing the answer to the complaint or pleading asserting a claim, a motion to dismiss may be made on any of the following grounds:
(a) That the court has no jurisdiction over the person of the defending party;
(b) That the court has no jurisdiction over the subject matter of the claim;
(c) That venue is improperly laid;
(d) That the plaintiff has no legal capacity to sue;
(e) That there is another action pending between the same parties for the same cause;
(f) That the cause of action is barred by a prior judgment or by the statute of limitations;
(g) That the pleading asserting the claim states no cause of action;
(h) That the claim or demand set forth in the plaintiff’s pleading has been paid, waived, abandoned, or otherwise extinguished;
(i) That the claim on which the action is founded is unenforceable under the provisions of the statute of frauds; and
(j) That a condition precedent for filing the claim has not been complied with.
Section 5 of the same Rule, recites the effect of a dismissal under Sections 1(f),[46] (h),[47]and (i),[48] thereof, thus:
SEC. 5. Effect of dismissal. – Subject to the right of appeal, an order granting a motion to dismiss based on paragraphs (f), (h), and (i) of section 1 hereof shall bar the refiling of the same action or claim.
Briefly stated, dismissals that are based on the following grounds, to wit: (1) that the cause of action is barred by a prior judgment or by the statute of limitations; (2) that the claim or demand set forth in the plaintiff’s pleading has been paid, waived, abandoned or otherwise extinguished; and (3) that the claim on which the action is founded is unenforceable under the provisions of the statute of frauds, bar the refiling of the same action or claim. Logically, the nature of the dismissal founded on any of the preceding grounds is “with prejudice” because the dismissal prevents the refiling of the same action or claim. Ergo, dismissals based on the rest of the grounds enumerated are without prejudice because they do not preclude the refiling of the same action.
Verily, the dismissal of petitioners’ Complaint by the court a quo was not based on any of the grounds specified in Section 5, Rule 16 of the 1997 Revised Rules of Civil Procedure; rather, it was grounded on what was encapsulated in Section 1(g), Rule 16 of the 1997 Revised Rules of Civil Procedure. As the trial court ratiocinated in its 9 January 1998 Order, the Complaint is not prosecuted by the proper party in interest.[49] Considering the heretofore discussion, we can say that the order of dismissal was based on the ground that the Complaint states no cause of action. For this reason, the dismissal of petitioners’ Complaint cannot be said to be a dismissal with prejudice which bars the refiling of the same action.
As has been earlier quoted, Section 1(h), Rule 41 of the 1997 Revised Rules of Civil Procedure mandates that no appeal may be taken from an order dismissing an action without prejudice. The same section provides that in such an instant where the final order is not appealable, the aggrieved party may file an appropriate special civil action under Rule 65.
The appellate court erred, thus, when it pronounced in its Decision of 24 May 2000 that petitioners’ remedy is appeal under Section 1, Rule 41 of the 1997 Revised Rules of Civil Procedure.
A Petition for Certiorari under Rule 65 is available in cases when there is no appeal, nor any plain, speedy, and adequate remedy in the ordinary course of law. In the case at bar, appeal of the 7 May 1998 Order, reviving the Order of 9 January 1998 , which dismissed petitioners’ Complaint, and as reiterated in the 17 July 1998 Order is not a remedy available to petitioners as aggrieved parties.
In sum, the appellate court erred when it ruled that petitioners’ Petition for Certiorari filed before it was not the proper remedy. The dismissal of the Complaint being without prejudice, the remedy available to the aggrieved party is Rule 65.
x x x."
See -
See -
FIRST DIVISION
STRONGWORLD CONSTRUCTION CORPORATION, LEO CLETO A. GAMOLO, and REYNOLD P. MOLO,
Petitioners,
- versus -
HON. N.C. PERELLO in her capacity as Presiding Judge of Branch 276 of the Regional Trial Court of Muntinlupa City, FIRST PEOPLE’S BANK, BANK OF COMMERCE, ORLANDO O. FRANCISCO, and EDITHA LIZARDA,
Respondents.
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G.R. No. 148026
Present:
PANGANIBAN, C.J.
Chairperson,
YNARES-SANTIAGO,
AUSTRIA-MARTINEZ,
CALLEJO, SR., and
CHICO-NAZARIO, JJ.
Promulgated:
July 27, 2006
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