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ROMEO J. ORDONEZ v. ALFREDO J. GUSTILO

FACTS:

The case involves a petition for certiorari filed by Valeriano Espiritu against the Municipality of Rosario, Cavite and Calixto Enriquez, seeking to annul a decision and orders issued in Civil Case No. N-4367 of the Regional Trial Court. Espiritu filed a complaint for Specific Performance and Damages to enforce a Reclamation Contract with the defendants. The defendant municipality argued that the claim was barred by the statute of limitations and that the contract had been substantially amended.

Romeo J. Ordonez, the barangay captain of Tejeros Convention, and seven other municipal and barangay officials intervened in the case. They alleged that no actual reclamation was done and that the claimed area resulted from natural accretion. The case proceeded to a pre-trial conference, during which the parties expressed their intention to submit a compromise agreement. The intervenors requested to present their evidence, and after hearings, a compromise agreement was submitted by the principal litigants.

The trial court approved the compromise agreement and rendered a decision, which the intervenors received a copy of. The intervenors then filed a motion to set aside the compromise agreement, but it was denied by the trial court. Meanwhile, the plaintiff filed a motion to terminate the proceedings, which was granted by the trial court.

ISSUES:

  1. Whether or not the lower court erred in stopping/preventing the intervenors from further presenting their evidence in support of their Answer-in-Intervention.

  2. Whether or not the lower court erred in approving the compromise agreement and rendering a decision based on it, despite the lack of authority of the respondent to bind the Municipality of Rosario.

  3. Whether the compromise agreement and the decision resolved the issues raised by the intervenors.

  4. Whether the lower court improperly terminated the proceedings without letting the intervenors complete their evidence.

  5. Whether the mayor needed another authority from the Sangguniang Bayan to sign the compromise agreement.

RULING:

  1. Both issues are answered in the negative.

  2. The compromise agreement and the decision had effectively resolved the issues raised by the intervenors, as it took into account their claims and denied their controverting theories. Thus, the continuation of the reception of the intervenors' evidence would serve no purpose.

  3. The lower court did not improperly terminate the proceedings as due process had been accorded to the intervenors. The court gave credence and weight to the compromise agreement, which was filed and approved after no opposition was made questioning its legality.

  4. The mayor did not need another authority from the Sangguniang Bayan to sign the compromise agreement. The execution of the agreement is an act implementing the reclamation contract, which was duly approved by the Sangguniang Bayan. Additionally, the terms and conditions of the compromise agreement were beneficial to the municipality as it reduced the share of Espiritu considerably.

PRINCIPLES:

  • Intervention is a proceeding in a suit or action where a third person is permitted by the court to make himself a party for the protection of a right or interest allegedly affected by the proceedings.

  • Intervention is collateral to the main action and is dependent on or subsidiary to the case between the original parties.

  • The final dismissal of the principal action results in the dismissal of the ancillary action of intervention.

  • A judgment approving a compromise agreement is final and immediately executory.

  • All pending issues become moot and academic once a compromise agreement is approved.

  • The resolution of a dispute through a compromise agreement and subsequent decision may effectively resolve the issues raised by intervenors.

  • Due process is accorded when the claims of the intervenors are taken into consideration by the court.

  • It is important for parties to timely file any opposition or motion questioning the legality of a compromise agreement to avoid its execution.

  • The mayor, as the Chief Executive of the municipal government, has the authority to represent the municipality in business transactions and sign contracts on its behalf. The execution of a compromise agreement may fall under this authority.