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You are in default

"What does it mean, and what is the remedy?"

 

The word default has different meanings. In basketball, a team shall lose a game by default if, during the game, the team has fewer than two players on the playing court ready to play (Article 21, FIBA 2020 Rules). Some mistake a default to a forfeit. A team shall lose a game by forfeit if: (a) it is not present or is unable to field 5 players 15 minutes after the game is to begin; (b) its actions prevent the game from being played; or (c) it refuses to play after being instructed (Article 20, FIBA Rules).   

In tennis, to be in default is to be disqualified in a match by the chair umpire after the player has received four code violation warnings for their conduct in court. A default can occur with less than four code violation warnings if the violation is determined to be severe. Default also occurs if a player misses a match without a valid excuse; defaults are considered as losses (Wikipedia Glossary of Tennis Terms).

In an adversarial proceeding in court, a default situation occurs when the defending party fails to file an Answer within thirty days from receipt of the summons and the complaint. However, the claiming party or the plaintiff must file a Motion to Declare the Defendant in Default before the latter is declared as such. It is important for the movant to show proof of the failure to file an Answer (Section 3, Rule 9, Rules of Civil Procedure).

There are three (3) requirements that the plaintiff/claiming party must comply with before the court may declare the defending party in default: (a) the plaintiff must file a motion asking the court to declare the defending party in default; (b) the defending party must be notified of the motion; and (c) the claiming party must prove that the defending party failed to answer within the period provided by the Rule (Manuel v. Ong, G.R. No. 205249, October 15, 2014 citing the case of Spouses Delos Santos v. Carpio).

It is possible that the defendant files an Answer but still be declared in default because he filed it beyond the period to file the same. Faced with the Motion to Declare the Defendant in Default and after examination of the court records, the court has two (2) options: (a) to grant the relief sought by the plaintiff/claimant in his pleading; or (b) to require the plaintiff/claimant to submit evidence ex-parte (without the participation of the defaulted party) which can be delegated to the clerk of court (Section 3, Rule 9, Rules of Civil Procedure).

A defaulted party, while not yet defeated, cannot participate in but is entitled to the notices of subsequent proceedings. It means that he loses his standing in court, including the right to present his defense, control the proceedings, examine or cross-examine the witnesses; he has no right to expect that his pleadings would be acted upon by the court nor may he refute evidence or motions filed against him (Otero v. Tan, G.R. No. 200134, August 15, 2012). Hence, in an ex-parte presentation of evidence, the plaintiff/claiming party’s witnesses will submit Judicial Affidavits in lieu of direct examination without the defendant being allowed to cross-examine the witnesses or object to the questions in the Judicial Affidavits.

What is the remedy of a defending party who is declared in default? A party declared in default may at any time after the receipt of the notice but before judgment, file a Motion to Set Aside the Order of Default under oath. There are three requisites in order to warrant the setting aside of an Order of Default for failure to file an Answer, these are: (a) it must be made by motion under oath by one who has knowledge of the facts; (b) it must be shown that the failure to file an Answer was due to fraud, accident, mistake, or excusable neglect; and (c) there must be proper showing of the meritorious defense (Manuel v. Ong, G.R. No. 205249, October 15, 2014 citing the case of Montinola, Jr. v. Republic Planters Bank).

The ground of fraud that would set aside the order of default must emanate from the adverse party and must be of such a nature so as to have deprived the defaulted defending party of his day in court (Pinausukan Seafood House v. Far East Bank & Trust Company, G.R. No. 159926, January 20, 2014). There is extrinsic fraud when a party is prevented from fully presenting his case to the court as when the lawyer connives to defeat or corruptly sells out his client’s interest. Hence, it can be committed by a counsel against his client when the latter is prevented from presenting his case to the court (Sy Bang v. Sy, G.R. No. 179955, April 24, 2009).

If the order of default is not lifted or set aside, and the case proceeds to judgment, the defending party may avail of the following remedies: (a) If the judgment has already been rendered but before becoming final and executory, he may file a motion for new trial under Section 1(a) of Rule 37 or an appeal; or (b) If the defendant discovered the default after the judgment has become final and executory, he may file a petition for relief under Section 2 of Rule 38 (Otero v. Tan, G.R. No. 200134, August 15, 2012 citing the case of Lina v. CA). The defending party may also avail of annulment of judgment under Rule 47 on the grounds of extrinsic fraud or lack of jurisdiction when judgment is final and executory.  

The defending party who is absent or fails to appear during pre-trial can also be considered in default. This is different from the defending party’s failure to file an Answer.  In the case of Saguid v. Court of Appeals, the defending party failed to submit a pre-trial brief which had the same effect as failure to appear at the pre-trial. The remedy of the defendant is to file a motion for reconsideration showing that his failure to file pre-trial brief was due to fraud, accident, mistake or excusable neglect. The motion need not stress that the defendant has a valid and meritorious defense because his Answer is already on record (G.R. No. 150611, June 10, 2003).

However, under the Revised Rules on Summary Procedure there is no order of default. Should the defendant fail to Answer the Complaint within ten days from service of summons, the court motu proprio, or upon motion of the plaintiff, shall render judgment as warranted by the facts alleged in the complaint and limited to what is prayed for therein (Section 6). In the Revised Rules of Procedure for Small Claims Cases, the failure to file a Response (Answer) coupled with the failure to appear on the hearing shall authorize the court to render judgment. Otherwise, the court will ascertain from the defendant, who did not file a Response, his defenses during the hearing and proceed to render judgment (Section 14, A.M. No. 08-8-7-SC).

Because of the serious consequences of not filing an Answer or Response, lawyers must observe diligence in handling the cases of their clients. It must be remembered that the mistake or negligence of counsel binds his client. It is every lawyer’s duty to protect the interest of his or her client with zeal and loyalty. In turn, clients must see to it that they are aware of the status of their cases since at the end of the day it will be they who will benefit or suffer from its outcome.

Topics: Tranquil G.S. Salvador III , default
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