2019 Legal Ethics and Practical Exercises, Q17

Mr. B, a resident of Quezon City, engaged you as counsel to assist him in acquiring the house and lot being sold by Ms. S, also a resident of Quezon City, which lot is covered by Transfer Certificate of Title No. 54321, with an area of 500 square meters, located at Barangay 123, Quezon City, Philippines (subject property). At the meeting where Mr. B, Ms. S, and you were present, the following terms and conditions were agreed upon:
1. the purchase price for the subject property is ₱50,000,000.00;
2. Ms. S will pay the capital gains tax and documentary stamp tax arising from the sale, as well as the real estate taxes up to the date of the sale, within thirty (30) days from execution of the deed of sale, while the rest of the expenses to effect the transfer of title will be shouldered by Mr. B; and
3. Ms. S gave the assurance that the subject property would be free from any occupant/s within the same thirty-(30) day period.
The Deed of Absolute Sale was scheduled to be signed by the parties on November 24, 2018 in Quezon City.
On December 27, 2018, Mr. B visited the subject property and found out that Ms. S’s brother, Mr. C, was still occupying the same. Furthermore, on the same day, Mr. B checked with the Bureau of Internal Revenue and discovered that the capital gains tax and the documentary stamp tax remained unpaid. Disappointed with the failure of Ms. S to duly fulfill her obligations based on their contract, Mr. B asked for your assistance regarding this matter.
Unfortunately, Ms. S did not heed the demand letter, constraining you, on behalf of Mr. B, to file the necessary complaint before the Regional Trial Court of Quezon City. The complaint was filed on February 15, 2019, docketed as Civil Case No. 654321 and was raffled to Branch 77. Eventually, Ms. S was duly served with summons on March 15, 2019. However, she failed to file an answer or any motion requesting for an extension to file the same.
Draft a Motion to Declare Ms. S in Default including the required Notice of Hearing. (15%)

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What is the primary ground for declaring a defendant in default under Rule 9, Section 3 of the Rules of Court?

Under the Rules of Civil Procedure, what is required before the court may issue an order declaring the defendant in default?

What is the immediate legal consequence when a defendant is declared in default by the trial court?

What procedural remedy is available to a defaulted defendant before the trial court renders judgment?

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How many days is the standard reglementary period for a defendant to file an answer after service of summons?

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1. Declaration of Default
Under Rule 9, Section 3 of the Rules of Court, if the defending party fails to answer within the time allowed therefor, the court shall, upon motion of the claiming party with notice to the defending party, and proof of such failure, declare the defending party in default. Thereupon, the court shall proceed to render judgment granting the claimant such relief as his pleading may warrant, unless the court in its discretion requires the claimant to submit evidence. A declaration of default deprives the defendant of standing in court, preventing active participation in the proceedings.

2. Requisites for Default
To validly declare a defendant in default, three essential requisites must concur: first, the court must have acquired jurisdiction over the person of the defendant through valid service of summons or voluntary appearance; second, the defendant failed to file an answer within the reglementary period or approved extension; and third, the plaintiff files a written motion to declare the defendant in default with notice to the defendant. Failure to comply with any of these requisites renders an order of default void for violating fundamental procedural due process.

3. Relief From Default
A party declared in default is not left without legal remedies under the Rules of Civil Procedure. Before judgment, the defaulted party may file a motion under oath to set aside the order of default upon showing that the failure to answer was due to fraud, accident, mistake, or excusable negligence, and that he has a meritorious defense. After judgment but before finality, a motion for new trial or reconsideration may be filed. After finality, relief from judgment or petition for annulment of judgment may be pursued.

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