The Supreme Court ruled that the period to execute a judgment can be extended if the delay is caused by the debtor’s actions, especially when those actions benefit the debtor. This means that if a debtor deliberately tries to avoid fulfilling a judgment, the time they spend doing so will not count against the creditor’s ability to enforce the judgment later. This decision ensures fairness and prevents debtors from profiting from their attempts to evade legal obligations. By pausing the clock on execution deadlines, the Court protects the rights of creditors and upholds the integrity of the judicial process. The decision emphasizes that the statute of limitations is not designed to penalize those who are actively pursuing their rights but are temporarily hindered by the actions of the opposing party.

Delayed Justice? How a Seller’s Deceit Extended the Buyer’s Right to Execute a Sale

Spouses Larry and Flora Davis (petitioners) entered into a Contract to Sell with Spouses Florencio and Lucresia Davis (respondents) for a 500-square meter lot in Bulacan. After the petitioners fully paid the agreed price, the respondents failed to execute the Deed of Absolute Sale, leading to a legal battle. The Regional Trial Court (RTC) of Malolos ruled in favor of the petitioners, ordering the respondents to execute the deed and pay damages. The Court of Appeals (CA) affirmed this decision, which became final on October 2, 2004.

However, the respondents sold the property to third parties, prompting the petitioners to file an action for annulment of title. The RTC declared the new title null and void, restoring the original title to the respondents. When the petitioners sought to implement the original decision, the respondents argued that the 5-year period for execution had lapsed. The RTC agreed, but the CA later dismissed the petition on procedural grounds. This brought the case to the Supreme Court.

Before addressing the substantive issue, the Supreme Court clarified a procedural point: While a motion for reconsideration is generally required before filing a Petition for Certiorari, there are exceptions. One such exception applies when the lower court has already ruled on the same issues raised in the certiorari petition. In this case, the RTC had already considered and rejected the petitioners’ argument that the period for execution was suspended, rendering a motion for reconsideration unnecessary. Therefore, the CA erred in dismissing the petition on this procedural technicality.

Turning to the central question, the Court addressed the execution of judgments. Section 6, Rule 39 of the Rules of Court dictates that a judgment must be executed within five years of its finality. Beyond this period, it can only be enforced through a separate action for revival of judgment, subject to the statute of limitations. However, jurisprudence recognizes exceptions where execution by motion is allowed even after five years, particularly when the delay is caused by the judgment debtor’s actions or benefits them. The crucial question here was whether the petitioners’ action for annulment of title tolled or suspended the running of the 5-year period to execute the original judgment.

The Supreme Court emphasized that the delay in executing the judgment was directly attributable to the respondents’ actions. By selling the property to third parties, the respondents deliberately attempted to evade their obligation to execute the Deed of Absolute Sale. This forced the petitioners to file a separate action to annul the new title and restore the original one, which was a necessary step to enforce the original judgment. To deny the petitioners the right to execute the original judgment simply because the 5-year period had lapsed due to the title annulment case would essentially reward the respondents for their bad faith actions.

The Court has consistently held that the statute of limitations should not benefit those who cause delays themselves. As the Supreme Court stated in Republic v. Court of Appeals:

there had been many instances where it allowed execution by motion even after the lapse of five years, upon meritorious grounds. These exceptions have one common denominator, and that is: the delay is caused or occasioned by actions of the judgment debtor and/or is incurred for his benefit or advantage.

Building on this principle, the Court reasoned that the time spent litigating the annulment case should not be counted against the petitioners. The Court held that the period for enforcing a judgment should be extended by any delay caused by the debtor. In computing the time limited for suing out an execution, the time during which execution is stayed should be excluded, and the time will be extended by any delay occasioned by the debtor.^[22] It bears stressing that the purpose of the law in prescribing time limitations for enforcing judgments or actions is to prevent obligors from sleeping on their rights.^[23] Moreover, the statute of limitations has not been devised against those who wish to act but cannot do so for causes beyond their control.^[24]

To rule otherwise would allow debtors to escape their obligations by deliberately creating obstacles to the execution of judgments. The Supreme Court highlighted that the statute of limitations is designed to prevent parties from sleeping on their rights, not to punish those who are actively pursuing their rights but are temporarily hindered by the debtor’s actions. The Court considered this as an exception to the general rule, as the petitioners were compelled to file another action involving the subject property to enable a complete and effective relief in their favor.

FAQs

What was the key issue in this case?	The key issue was whether the 5-year period to execute a judgment by motion was tolled or suspended due to the debtor’s actions that hindered the execution. Specifically, the Court examined whether the period was extended by the time spent litigating a separate case to annul the title that the debtor had fraudulently transferred.
What does it mean to execute a judgment?	Executing a judgment means enforcing the court’s decision, such as ordering the losing party to pay money or transfer property. It is the process by which the court’s ruling is carried out and made effective.
What happens if the 5-year period to execute a judgment has lapsed?	If the 5-year period has lapsed, the judgment can only be enforced through a separate action for revival of judgment, which must be filed before it is barred by the statute of limitations. This means the creditor must file a new lawsuit to re-establish the judgment and seek its enforcement.
When can the 5-year period to execute a judgment be extended?	The 5-year period can be extended when the delay in execution is caused by the actions of the judgment debtor or is incurred for their benefit or advantage. This includes situations where the debtor actively tries to prevent the execution of the judgment.
What was the debtor’s action that caused the delay in this case?	The debtor, Spouses Florencio and Lucresia Davis, sold the subject property to third parties after the court had ordered them to execute a Deed of Absolute Sale to the petitioners. This required the petitioners to file a separate action to annul the title of the new owners.
How did the Supreme Court rule on the procedural issue of Motion for Reconsideration?	The Supreme Court ruled that filing a Motion for Reconsideration was unnecessary because the RTC had already passed upon the same issue raised in the Petition for Certiorari. Thus, the CA erred in dismissing the petition based on the failure to file a Motion for Reconsideration.
Why did the Supreme Court rule in favor of the petitioners?	The Supreme Court ruled in favor of the petitioners because the delay in executing the judgment was caused by the respondents’ actions, which was selling the property to avoid fulfilling their obligation. The Court held that the period during which the annulment case was litigated should not be counted against the petitioners.
What is the practical implication of this ruling?	The practical implication is that debtors cannot benefit from their attempts to evade legal obligations. If they cause delays in the execution of a judgment, those delays will not be counted against the creditor’s ability to enforce the judgment later.

In conclusion, the Supreme Court’s decision reinforces the principle that debtors cannot profit from their own wrongdoing. By extending the period for executing judgments when debtors deliberately create obstacles, the Court ensures fairness and upholds the integrity of the legal system. This ruling serves as a reminder that courts will not allow technicalities to shield those who attempt to evade their legal obligations.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Spouses Larry and Flora Davis v. Spouses Florencio and Lucrecia Davis, G.R. No. 233489, March 07, 2018