LEGAL NOTE 0041: WHAT IS LACHES?

 

SOURCE: INSURANCE OF THE PHILIPPINE ISLANDS CORPORATION VS. SPOUSES VIDAL S. GREGORIO AND JULITA GREGORIO (G.R. NO. 174104, 14 FEBRUARY 2011, PERALTA, J.)

 

IN 1968  SPOUSES GREGORIO MORTGAGED PARCELS OF LAND TO INSURANCE  PHILIPPINE ISLANDS CORP COVERED BY TAX DECLARATION. IN 1969 THEY WERE FORECLOSED. IN 1996 IPIC FILED DAMAGES AGAINST SPOUSES GROGORIO ON THE GROUND THAT IN 1995 THEY DISCOVERED THAT THE SPOUSES SOLD THE PROPERTIES TO THIRD PARTIES WHO HAVE THESE LANDS TITLED.

 

ONE DEFENSE OF THE SPOUSES IS THAT IPIC IS GUILTY OF LACHES. IS THIS DEFENSE VALID?

 

NO. THE SPOUSES ACTED IN BAD FAITH. IF DEFENSE OF LACHES IS ALLOWED, IT WILL RESULT TO INJUSTICE.

 

SAID THE COURT:

 

“It is significant to point out at this juncture that the overriding consideration in the instant case is that petitioner was deprived of the subject properties which it should have rightly owned were it not for the fraud committed by respondents. Hence, it would be the height of injustice if respondents would be allowed to go scot-free simply because petitioner relied in good faith on the former’s false representations. Besides, as earlier discussed, even in the exercise of due diligence, petitioner could not have been expected to immediately discover respondents’ fraudulent scheme.”

 

 

WHAT IS THE ESSENCE OF LACHES? 

 

“The essence of laches or “stale demands” is the failure or neglect for an unreasonable and unexplained length of time to do that which, by exercising due diligence, could or should have been done earlier, thus, giving rise to a presumption that the party entitled to assert it either has abandoned or declined to assert it.9″

 

IS IT MERELY DUE TO LAPSE OF TIME?

 

NO. IT IS NOT CONCERNED WITH MERE LAPSE OF TIME.

 

“It is not concerned with mere lapse of time; the fact of delay, standing alone, being insufficient to constitute laches.10″

 

WHAT IS ITS PURPOSE?

 

NOT TO PENALIZE SLEEPING ON ONE’S RIGHTS BUT TO AVOID RECOGNIZING A RIGHT WHEN TO DO SO WOULD RESULT IN A CLEARLY UNFAIR SITUATION.

 

“In addition, it is a rule of equity and applied not to penalize neglect or sleeping on one’s rights, but rather to avoid recognizing a right when to do so would result in a clearly unfair situation.11 ”

 

WHAT CONSTITUTES LACHES OR STALENESS OF DEMAND?

 

THERE IS NO ABSOLUTE RULE. IT DEPENDS ON EACH CASE.

 

“There is no absolute rule as to what constitutes laches or staleness of demand; each case is to be determined according to its particular circumstances.12 Ultimately, the question of laches is addressed to the sound discretion of the court.”

 

WHAT IS THE BASIS THEN IN DETERMINING WHETHER THERE IS LACHES?

 

EQUITABLE CONSIDERATIONS.

“. . .   being an equitable doctrine, its application is controlled by equitable considerations.13 ”

 

BUT CAN IT BE USED AS DEFENSE?

 

YES, BUT IT CANNOT BE USED WHEN TO DO SO IT WOULD RESULT TO INJUSTICE.

 

“It cannot be used to defeat justice or perpetrate fraud and injustice.14 It is the better rule that courts, under the principle of equity, will not be guided or bound strictly by the statute of limitations or the doctrine of laches when to be so, a manifest wrong or injustice would result.15″

 

1Penned by Associate Justice Renato C. Dacudao, with Associate Justices Hakim S. Abdulwahid and Monina Arevalo-Zenarosa, concurring; rollo, pp. 28-40.2Id. at 42.3Rollo, pp. 187-194.4Id. at 29-30.5Records, pp. 1-12.6Id. at 77-82.7Id. at 553-554.8Philippine Long Distance Telephone Company v. Dulay, 254 Phil. 30, 36 (1989).9Heirs of Emilio Santioque v. Heirs of Emilio Calma, G.R. No. 160832, October 27, 2006, 505 SCRA 665, 684-685.10GF Equity, Inc. v. Valenzona, G.R. No. 156841, June 30, 2005, 462 SCRA 466, 480.11Bicol Agro-Industrial Producers Cooperative, Inc. (BAPCI) v. Obias, G.R. No. 172077, October 9, 2009, 603 SCRA 173, 196; Bogo-Medellin Milling Co., Inc. v. Court of Appeals, 455 Phil. 285, 303 (2003).12Department of Education, Division of Albay v. Oñate, G.R. No. 161758, June 8, 2007, 524 SCRA 200, 216-217.13Placewell International Services Corporation v. Camote, G.R. No. 169973, June 26, 2006, 492 SCRA 761, 769.14LICOMCEN, Inc. v. Foundation Specialists, Inc., G.R. Nos. 167022 and 169678, August 31, 2007, 531 SCRA 705, 725; Amoroso v. Alegre, Jr., G.R. No. 142766, June 15, 2007, 524 SCRA 641, 656; Galicia v. Manliquez Vda. de Mindo, G.R. No. 155785, April 13, 2007, 521 SCRA 85, 96.15Benatiro v. Heirs of Evaristo Cuyos, G.R. No. 161220, July 30, 2008, 560 SCRA 478, 503.