Political Law

Development Bank of the Philippines vs Court of Appeals

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 G.R. No. 119712 – 302 SCRA 362 – Political Law – Due Process – Right to be Heard – Opportunity to be Heard

In 1968 and 1969, Continental Cement Corp. entered into a loan contract with DBP. In 1979, CCC entered into a MOA with DBP restructuring its loans. In November 1985, DBP filed for a foreclosure against the assets of CCC. In December 1985, CCC petitioned before RTC Bulacan to enjoin DBP and the Sheriff of Bulacan from foreclosing its assets and praying further that its loan terms with DBP be restructured and that the interest rate terms in the promissory note be declared null and void. A TRO was issued in favor of CCC. In December 1986, PP 502 was issued transferring nonperforming assets of the gov’t to Asset Privatization Trust. One of those transferred was CCC’s account. DBP filed a petition to dismiss the pending case as it CCC could no longer deal with DBP but rather with APT. The trial court denied the petition and has instead allowed APT to join the proceeding pursuant to PP 502 as amended. To determine CCC’s indebtedness to DBP/APT, the RTC designated JC Laya (former BSP Gov and DepEd Sec) as chair of a fact finding commission. He was given 60 days to come up with a report and he was given a lot of extensions thereafter. After several months, he was able to come up with the report. The parties then filed their reactions to the report and during the trial they were given a chance to cross examine each other’s witnesses. After cross examination, they were ordered to submit their position papers as to their calculation of the amount of indebtedness. CCC’s computation is at P43.6M, the Commissioner’s computation is at P61.6M while DBP/APT’s calculation is at P2.6B. In June 1992, 3 of CCC’s witnesses were scheduled to be cross examined by APT’s counsel as DBP’s counsel had already done so. APT’s counsel was not able to do so raising the issue that he just took over the case and needs time to prepare. The cross examination was reset to August 24-26, 1992 but counsel for APT failed to appear due to Dengue. The other counsel, Jaime Cruz, for DBP was likewise absent; he’s also a witness. On Aug 25th, the RTC ordered that due to the foregoing the case is deemed submitted for decision. APT filed for a motion for reconsideration. It was denied and the RTC ruled that the indebtedness to be paid by CCC is the calculation came up with by the Commissioner. APT appealed before the CA averring that it was denied due process when it was not allowed to cross examine the witnesses of CCC nor was it allowed to present further witnesses. CCC averred that by the failure of APT’s counsel to appear APT has waived such right. The CA sustained the RTC’s decision.

ISSUE: Whether or not APT was denied of due process.

HELD: The SC sustained the CA’s ruling. Long ingrained in jurisprudence is the principle that there can be no denial of due process where a party had the opportunity to participate in the proceedings but did not do so. The withdrawal of APT’s previous counsel in the thick of the proceedings would be a reasonable ground to seek postponement of the hearing. However, such reason necessitates a duty, nay an obligation, on the part of the new counsel to prepare himself for the next scheduled hearing. The excuse that it was due to the former counsel’s failure to turn over the records of the case to APT, shows the negligence of the new counsel to actively recover the records of the case. Mere demands are not sufficient. Counsel should have taken adequate steps to fully protect the interest of his client, rather than pass the blame on the previous counsel.

The due process requirement is satisfied where the parties are given the opportunity to submit position papers, as in this case. Both parties, CCC and DBP/APT, were given opportunity to submit their respective position papers after the Commissioner rendered his report. Contained in their position papers were their respective comments and objections to the said report. Furthermore, the parties were also given the chance to cross-examine the Commissioner and his representative. They were likewise granted opportunity to cross-examine the witnesses of the other party, however, like in APT’s case, they were deemed to have waived their right, as previously discussed.

The essence of due process is that a party be afforded a reasonable opportunity to be heard and to support any evidence he may have in support of his defense. What the law prohibits is absolute absence of the opportunity to be heard, hence, a party cannot feign denial of due process when he had been afforded the opportunity to present his side.

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