Given the extraordinary nature and the objective of the remedy of annulment of judgment or final order, Pinausukan must be mindful of and should closely comply with the following statutory requirements for the remedy as set forth in Rule 47 of the Rules of Court.
Requirements for Annulment of Judgment
The first requirement prescribes that the remedy is available only when the petitioner can no longer resort to the ordinary remedies of new trial, appeal, petition for relief or other appropriate remedies through no fault of the petitioner.31 This means that the remedy, although seen as "a last remedy,"32 is not an alternative to the ordinary remedies of new trial, appeal and petition for relief. The petition must aver, therefore, that the petitioner failed to move for a new trial, or to appeal, or to file a petition for relief without fault on his part. But this requirement to aver is not imposed when the ground for the petition is lack of jurisdiction (whether alleged singly or in combination with extrinsic fraud), simply because the judgment or final order, being void, may be assailed at any time either collaterally or by direct action or by resisting such judgment or final order in any action or proceeding whenever it is invoked, unless the ground of lack of jurisdiction is meanwhile barred by laches.33
The second requirement limits the ground for the action of annulment of judgment to either extrinsic fraud or lack of jurisdiction.
Not every kind of fraud justifies the action of annulment of judgment. Only extrinsic fraud does.1âwphi1 Fraud is extrinsic, according to Cosmic Lumber Corporation v. Court of Appeals,34 "where the unsuccessful party has been prevented from exhibiting fully his case, by fraud or deception practiced on him by his opponent, as by keeping him away from court, a false promise of a compromise; or where the defendant never had knowledge of the suit, being kept in ignorance by the acts of the plaintiff; or where an attorney fraudulently or without authority connives at his defeat; these and similar cases which show that there has never been a real contest in the trial or hearing of the case are reasons for which a new suit may be sustained to set aside and annul the former judgment and open the case for a new and fair hearing."
The overriding consideration when extrinsic fraud is alleged is that the fraudulent scheme of the prevailing litigant prevented the petitioner from having his day in court.35 Nonetheless, extrinsic fraud shall not be a valid ground if it was availed of, or could have been availed of, in a motion for new trial or petition for relief.36
In contrast, intrinsic fraud refers to the acts of a party at a trial that prevented a fair and just determination of the case, but the difference is that the acts or things, like falsification and false testimony, could have been litigated and determined at the trial or adjudication of the case.37 In other words, intrinsic fraud does not deprive the petitioner of his day in court because he can guard against that kind of fraud through so many means, including a thorough trial preparation, a skillful cross-examination, resorting to the modes of discovery, and proper scientific or forensic applications. Indeed, forgery of documents and evidence for use at the trial and perjury in court testimony have been regarded as not preventing the participation of any party in the proceedings, and are not, therefore, constitutive of extrinsic fraud.38
Lack of jurisdiction on the part of the trial court in rendering the judgment or final order is either lack of jurisdiction over the subject matter or nature of the action, or lack of jurisdiction over the person of the petitioner. The former is a matter of substantive law because statutory law defines the jurisdiction of the courts over the subject matter or nature of the action. The latter is a matter of procedural law, for it involves the service of summons or other process on the petitioner. A judgment or final order issued by the trial court without jurisdiction over the subject matter or nature of the action is always void, and, in the words of Justice Street in Banco Español-Filipino v. Palanca,39 "in this sense it may be said to be a lawless thing, which can be treated as an outlaw and slain at sight, or ignored wherever and whenever it exhibits its head."40 But the defect of lack of jurisdiction over the person, being a matter of procedural law, may be waived by the party concerned either expressly or impliedly.
The third requirement sets the time for the filing of the action. The action, if based on extrinsic fraud, must be filed within four years from the discovery of the extrinsic fraud; and if based on lack of jurisdiction, must be brought before it is barred by laches or estoppel.
Laches is the failure or neglect for an unreasonable and unexplained length of time to do that which by exercising due diligence could nor should have been done earlier; it is negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert it either has abandoned it or declined to assert it.41 Its other name is stale demands, and it is based upon grounds of public policy that requires, for the peace of society, the discouragement of stale claims and, unlike the statute of limitations, is not a mere question of time but is principally a question of the inequity or unfairness of permitting a right or claim to be enforced or asserted.42 The existence of four elements must be shown in order to validate laches as a defense, to wit: (a) conduct on the part of the defendant, or of one under whom a claim is made, giving rise to a situation for which a complaint is filed and a remedy sought; (b) delay in asserting the rights of the complainant, who has knowledge or notice of the defendant’s conduct and has been afforded an opportunity to institute a suit; (c) lack of knowledge or notice on the part of the defendant that the complainant will assert the right on which the latter has based the suit; and (d) injury or prejudice to the defendant in the event that the complainant is granted a relief or the suit is not deemed barred.43
Estoppel precludes a person who has admitted or made a representation about something as true from denying or disproving it against anyone else relying on his admission or representation.44 Thus, our law on evidence regards estoppel as conclusive by stating that "whenever a party has, by his own declaration, act, or omission, intentionally and deliberately led another to believe a particular thing true, and to act upon such belief, he cannot, in any litigation arising out of such declaration, act or omission, be permitted to falsify it."45
The fourth requirement demands that the petition should be verified, and should allege with particularity the facts and the law relied upon for annulment, as well as those supporting the petitioner’s good and substantial cause of action or defense, as the case may be.46 The need for particularity cannot be dispensed with because averring the circumstances constituting either fraud or mistake with particularity is a universal requirement in the rules of pleading.47 The petition is to be filed in seven clearly legible copies, together with sufficient copies corresponding to the number of respondents, and shall contain essential submissions, specifically: (a) the certified true copy of the judgment or final order or resolution, to be attached to the original copy of the petition intended for the court and indicated as such by the petitioner;48 (b) the affidavits of witnesses or documents supporting the cause of action or defense; and (c) the sworn certification that the petitioner has not theretofore commenced any other action involving the same issues in the Supreme Court, the CA or the different divisions thereof, or any other tribunal or agency; if there is such other action or proceeding, he must state the status of the same, and if he should thereafter learn that a similar action or proceeding has been filed or is pending before the Supreme Court, the CA, or different divisions thereof, or any other tribunal or agency, he undertakes to promptly inform the said courts and other tribunal or agency thereof within five days therefrom.49
The purpose of these requirements of the sworn verification and the particularization of the allegations of the extrinsic fraud in the petition, of the submission of the certified true copy of the judgment or final order or resolution, and of the attachment of the affidavits of witnesses and documents supporting the cause of action or defense is to forthwith bring all the relevant facts to the CA’s cognizance in order to enable the CA to determine whether or not the petition has substantial merit. Should it find prima facie merit in the petition, the CA shall give the petition due course and direct the service of summons on the respondent; otherwise, the CA has the discretion to outrightly dismiss the petition for annulment.50 (Pinausukan Seafood House vs. Far East Bank, G.R. No. 159926, 20 Jan. 2014) Read: SC Decision Text
Extrinsic Fraud Not the Only Ground for Annulment of Judgment
We hold that the Court of Appeals erred in limiting the ground(s) for annulment of judgment to only one, namely, extrinsic fraud. While it is true that in the cited cases of Canlas vs. CA[20]and Islamic Da Wah Council of the Philippines. vs. Court of Appeals,[21] this Court said that a judgment may be annulled on the ground of extrinsic or collateral fraud,[22] we should hasten to add that in Macabingkil vs. Peoples Homesite and Housing Corporation,[23] where the above ruling on annulment of judgment was based, we held that there are really three ways by which a final judgment may be attacked: [24]
Under existing rules, there are three (3) ways by which a final and executory judgment may be set aside.
The first is by petition for relief from judgment under Rule 38 of the Revised Rules of Court, when judgment has been taken against the party through fraud, accident, mistake or excusable negligence, in which case the petition must be filed within sixty (60) days after the petitioner learns of the judgment, but not more than six (6) months after such judgment was entered.
The second is by direct action to annul and enjoin the enforcement of the judgment. This remedy presupposes that the challenged judgment is not void upon its face, but is entirely regular in form, and the alleged defect is one which is not apparent upon its face or from the recitals contained in the judgment.[fn: Abbain v. Chua, 22 SCRA 798; Cadano v. Cadano, 49 SCRA 33; Anuran v. Aquino, 38 Phil. 329] As explained in Banco Español-Filipino v. Palanca, [fn: 37 Phil. 291, 949] "under accepted principles of law and practice, long recognized in American courts, the proper remedy in such case, after the time for appeal or review has passed, is for the aggrieved party to bring an action enjoining the judgment, if not already carried into effect; or if the property has already been disposed of, he may institute suit to recover it."
The third is either a direct action, as certiorari, or by a collateral attack against the challenged judgment (which is) is void upon its face, or that the nullity of the judgment is apparent by virtue of its own recitals. As aptly explained by Justice Malcolm in his dissent in Banco Español-Filipino v. Palanca, supra, "A judgment which is void upon its face, and which requires only an inspection of the judgment roll to demonstrate its want of vitality is a dead limb upon the judicial tree, which should be lopped off, if the power so to do exists."
Since the aforementioned decision in Civil Case No. Q-5866 is not void upon its face, it may only be annulled by direct action on the ground of fraud.
On the one hand, extrinsic fraud is the ground to annul a voidable final judgment; the declaration of nullity of a patently void final judgment, on the other, is based on grounds other than extrinsic fraud. To say, then, that petitioners can avail themselves only of the ground of extrinsic fraud and no other is to fail to appreciate the true meaning and ramifications of annulment/nullity.
It is clear then that to set aside a final and executory judgment, there are three remedies available to a litigant:first, a petition for relief from judgment under Rule 38 of the Rules of Court 25 on grounds of fraud, accident, mistake and excusable negligence filed within sixty (60) days from the time petitioner learns of the judgment but not more than six (6) months from the entry thereof; second, a direct action to annul the judgment on the ground of extrinsic fraud; and third, a direct action forcertiorari or collateral attack to annul a judgment that is void upon its face or void by virtue of its own recitals. Thus, Macabingkil did not preclude the setting aside of a decision that is patently void where mere inspection of the judgment is enough to demonstrate its nullity on grounds of want of jurisdiction or non-compliance with due process of law. This doctrine is recognized in other cases: 26
. . . . There is no question that a final judgment may be annulled. There are, however, certain requisites which must be established before a judgment can be the subject of an action for annulment. "Under the present procedure, aside from the reliefs provided in these two sections (Secs. 1 & 2, Rule 38), there is no other means whereby the defeated party may procure final and executory judgment to be a set aside with a view to the renewal of the litigation, unless (a) the judgment is void for want of jurisdiction or for lack of due process of law, or (b) it has been obtained by fraud." (I Moran's Rule of Court 1950 Ed., 697, citing Anuran v. Aquino, 38 Phil. 29; Banco Español-Filipino v. Palanca, 37 Phil. 921). Reason of public policy which favors the stability of judicial decisions are (sic) mute in the presence of fraud which the law abhors (Garchitorena vs. Sotelo, 74 Phil. 25).
Extrinsic Fraud, Defined
It is only extrinsic or collateral fraud, as distinguished from intrinsic fraud, however, that can serve as a basis for the annulment of judgment. [Aring v. Original, 6 SCRA 1021, 1025; Velasco v. Velasco, 2 SCRA 736] Fraud has been regarded as extrinsic or collateral, within the meaning of the rule, "where it is one the effect of which prevents a party from having a trial, or real contest, or from presenting all of his case to the court, or where it operates upon matters pertaining, not to the judgment itself, but to the manner in which it was procured so that there is not a fair submission of the controversy." [46 Am. Jur. 913] . . . . (Marcelino Arcelona versus Court of Appeals, G.R. No. 102900 October 2, 1997)
When Lack of Fault May Not be Alleged
Indeed, where a petition for annulment of a judgment or a final order of the RTC filed under Rule 47 of the Rules of Court is grounded on lack of jurisdiction over the person of the respondent or over the nature or subject of the action, the petitioner need not allege in the petition that the ordinary remedy of new trial or reconsideration of the final order or judgment or appeal therefrom is no longer available through no fault of his own, precisely because the judgment rendered or the final order issued by the RTC without jurisdiction is null and void and may be assailed any time either collaterally or in a direct action or by resisting such judgment or final order in any action or proceeding whenever it is invoked, unless barred by laches.”26 (Paulino vs. Court of Appeals, G.R. No. 205065, 04 June 2014)
