CASE DIGEST : Boaz International Trading Corporation and F.R. Cement Corporation v. Woodward Japan, Inc. and North Front Shipping Services, Inc. G.R. No. 147793, December 11, 2003

FACTS

Woodward Japan, Inc. filed a collection case before the Regional Trial Court (RTC) against Boaz International Trading Corporation to recover alleged demurrage charges arising from the shipment of cement. In response, Boaz filed a third-party complaint against North Front Shipping Services, Inc., claiming that the latter should be liable for any amount adjudged against it. During the scheduled pre-trial, however, neither Woodward nor its counsel appeared despite due notice. Pursuant to Section 5, Rule 18 of the Rules of Court, which authorizes the dismissal of an action when the plaintiff fails to appear at pre-trial, the RTC dismissed Woodward's complaint.

Woodward received the dismissal order but filed its Motion for Reconsideration beyond the 15-day reglementary period under the Rules of Court. The RTC correctly denied the motion for being filed out of time, making the dismissal final and executory. Instead of appealing, Woodward later filed a "Motion to Reinstate Complaint and Allow Plaintiff to Present Evidence," which was filed more than seven months after the dismissal had already become final. Despite the finality of its earlier order, the RTC granted the motion and reinstated the complaint.

Boaz elevated the matter to the Court of Appeals, arguing that the RTC no longer had jurisdiction to revive a case already dismissed with finality. The Court of Appeals nevertheless affirmed the reinstatement, reasoning that procedural rules should be liberally construed to serve substantial justice. Boaz then filed a Petition for Review on Certiorari before the Supreme Court, insisting that the RTC committed grave abuse of discretion in reviving a judgment that had already attained finality.

ISSUE

Whether the Regional Trial Court could validly reinstate Woodward's complaint after the dismissal order had already become final and executory.

A related issue was whether Woodward's Motion to Reinstate Complaint was a permissible remedy under the Rules of Court or was, in effect, a prohibited second motion for reconsideration under Section 5, Rule 37. The Court likewise had to determine whether the liberal construction of procedural rules under Section 6, Rule 1 of the Rules of Court justified the reinstatement despite Woodward's repeated procedural violations.

HELD

The Supreme Court granted the petition and set aside the RTC's Order reinstating the complaint. It ruled that once the dismissal order became final due to Woodward's failure to file a timely motion for reconsideration or appeal, the RTC lost jurisdiction over the case. Under the doctrine of immutability and finality of judgments, a court may no longer amend, modify, reverse, or revive a final judgment except in recognized exceptional circumstances, none of which existed in the case. Accordingly, the RTC acted without authority when it reinstated the complaint.

The Court further held that Woodward's Motion to Reinstate Complaint was merely a second motion for reconsideration in disguise, which is expressly prohibited by Section 5, Rule 37 of the Rules of Court. Since the first motion for reconsideration had already been denied and the dismissal had become final, the subsequent motion had no legal basis. The Court emphasized that litigants cannot evade procedural rules by simply changing the title of their pleadings.

The Court also rejected Woodward's plea for liberal application of procedural rules. While Section 6, Rule 1 of the Rules of Court allows liberal construction to secure the just, speedy, and inexpensive disposition of cases, such liberality cannot be invoked by a party who repeatedly ignored mandatory procedural requirements. Woodward failed to appear at pre-trial, filed an out-of-time motion for reconsideration, and later resorted to an unauthorized pleading. The Court stressed that procedural rules are designed to promote the orderly administration of justice and cannot be disregarded without compelling justification.

Finally, the Court observed that Woodward likewise failed to demonstrate a clearly meritorious claim against Boaz. The alleged agreement requiring Boaz to pay demurrage charges was not sufficiently established, and the documentary evidence did not prima facie prove Boaz's liability. Considering the finality of the dismissal order, the prohibition against second motions for reconsideration, and the absence of any compelling reason to relax the Rules, the Supreme Court declared the RTC's reinstatement order null and void and dismissed Woodward's complaint with finalitya