Republic of the PhilippinesSUPREME COURTManilaFIRST DIVISION
G.R. No. 104175 June 25, 1993YOUNG AUTO SUPPLY CO. AND NEMESO
GARCA, petitioners, vs.T!E !ONORA"LE COURT O# APPEALS $T!RTEENT!
D%SON& AND GEORGE C!ONG RO'AS, respondents.Angara, Abello,
Concepcion, Regala & Cruz for petitioners.Antonio Nuyles for
private respondent. (UASON, J.:Petitioners seek to set aside the
decision of respondent Court of Appeals in CA-G.R. SPNo. 2523,
!hich reversed the "rder dated #e$ruar% &, '((' issued $% the
Re)ional *rial Court, +ranch '', Ce$u Cit% in Civil Case No. C,+
-(-. *he order of the trial court denied the .otion to dis.iss
filed $% respondent Geor)e C. Ro/as of the co.plaint for collection
filed $% petitioners.0t appears that so.eti.e on "cto$er 2&,
'(&, 1oun) Auto Suppl% Co. 0nc. 21ASC"3 represented $% Ne.esio
Garcia, its president, Nelson Garcia and 4icente S%, sold all of
their shares of stock in Consolidated 5arketin) 6 7evelop.ent
Corporation 2C57C3 to Ro/as. *he purchase price !as
P&,888,888.88 pa%a$le as follo!s9 a do!npa%.ent of
P:,888,888.88 and the $alance of P:,888,888.88 in four post dated
checks of P',888,888.88 each.0..ediatel% after the e/ecution of the
a)ree.ent, Ro/as took full control of the four .arkets of C57C.
;o!ever, the vendors held on to the stock certificates of C57C as
securit% pendin) full pa%.ent of the $alance of the purchase
price.*he first check of P:,888,888.88, representin) the
do!n-pa%.ent, !as honored $% the dra!ee $ank $ut the four other
checks representin) the $alance of P:,888,888.88 !ere dishonored.
0n the .eanti.e, Ro/as sold one of the .arkets to a third part%.
"ut of the proceeds of the sale, 1ASC" received P-88,888.88,
leavin) a $alance of P3,:88,888.88 2Rollo, p. '-3.Su$ses fees and
costs 2Rollo, p. 2(83.Ro/as filed t!o .otions for e/tension of ti.e
to su$.it his ans!er. +ut despite said .otion, he failed to do so
causin) petitioners to file a .otion to have hi. declared in
default. Ro/as then filed, throu)h a ne! counsel, a third .otion
for e/tension of ti.e to su$.it a responsive pleadin)."n Au)ust '(,
'(&&, the trial court declared Ro/as in default. *he order
of default !as, ho!ever, lifted upon .otion of Ro/as."n Au)ust 22,
'(&&, Ro/as filed a .otion to dis.iss on the )rounds
that9'. *he co.plaint did not state a cause of action due to
non-?oinder of indispensa$le parties@2. *he clai. or de.and set
forth in the co.plaint had $een !aived, a$andoned or other!ise
e/tin)uished@ and3. *he venue !as i.properl% laid 2Rollo, p.
2((3.After a hearin), !herein testi.onial and docu.entar% evidence
!ere presented $% $oth parties, the trial court in an "rder dated
#e$ruar% &, '((' denied Ro/as> .otion to dis.iss. After
receivin) said order, Ro/as filed another .otion for e/tension of
ti.e to su$.it his ans!er. ;e also filed a .otion for
reconsideration, !hich the trial court denied in its "rder dated
April '8, '((' for $ein) pro-forma 2Rollo, p. '3. Ro/as !as a)ain
declared in default, on the )round that his .otion for
reconsideration did not toll the runnin) of the period to file his
ans!er."n 5a% 3, '((', Ro/as filed an unverified 5otion to Aift the
"rder of 7efault !hich !as not acco.panied !ith the re
