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CALIFORNIA AND HAWAIIAN SUGAR CO.; PACIFIC GULF MARINE,

INC.; AND CF SHARP AND COMPANY vs PIONEER INSURANCE AND

SURETY CORPORATION

(28 November 2000)

DOCTRINE: Under the pre-1997 RoC, a preliminary hearing on theaffirmative defenses may be allowed when a motion to dismiss has notbeen filed or when, having been filed, it has not been denied

unconditionally. Hence, if its resolution has been merely deferred, the

grounds it invokes may still be raised as affirmative defences, and apreliminary hearing thereon allowed.

NATURE: Petition for review on certiorari

PONENTE: Panganiban,J.

FACTS:

Nov 1990 Vessel MV Sugar Lander arrived at the port of Manilacarrying a cargo of soybean meal in bulk consigned to several

consignees, including Metro. After numerous transfers, offloading, rebagging, and reloading, therespondent claimed that there was a shortage of 255 tons of

soybean meal.

This shipment was insured with the private respondent against allrisk for Php 19++M.

Petitioners allegedly refused to settle their respective liabilities,respondent paid the consignee.

Nov 1992 Respondent, as alleged assignee of Metro, filed acomplaint for damages against the petitioners.

Petitioners filed a Motion to Dismiss the complaint, on theground that respondents claim is premature and should have goneunder arbitration.

Nov 1992 RTC issued an Order deferring the hearing on theMotion to Dismiss until trial, directed petitioners to file theirAnswer. MR for MTD was denied, because RTC said that theirreason for the MTD must be proven using evidence.

Petitioners filed an Answer with Counterclaim and Crossclaim,alleging that respondent did not comply with the arbitration clauseof the charter party so complaint was prematurely filed.

1993 Petitioners filed a Motion to Defer Pre-Trial and Motionto Set for Preliminary Hearing the Affirmative Defense ofLack of Cause of Action for Failure to Comply withArbitration Clause. Respondent did not file an Opposition tothese motions.

RTC: DENIED Motion to Set for Prelim Hearing; MR also denied CA: Affirmed RTC

ISSUE/S:

(Issue relevant to CivPro) Did the RTC commit grave abuse of discretion inrefusing to grant the Motion for Preliminary hearing that was filed by thepetitioners?

HELD: YES.

RATIO/RULING:

When this case was pending in the TC, Sec 5, Rule 16 of the pre-1997 RoC was still in effect.

o Sec 5: Pleading grounds as affirmative defences Any ofthe grounds provided for in this Rule, except impropervenue, may be pleaded as an affirmative defense, and apreliminary hearing may be had thereon as if a motion todismiss had been filed.

According to the respondent, such provision cannot be appliedbecause they have already filed a Motion to Dismiss.

SC says: While it is true that Sec 6, Rule 16 of the 1997 Rulesspecifically provides that a preliminary hearing on the affirmativedefenses may be allowed only when no motion to dismiss has beenfiled, Sec 3 of the same rule also says that courts must resolve amotion to dismiss and prohibits them from deferring its resolution

on the ground of indubitability.

Sec 6 disallows a preliminary hearing of the affirmative defencesbecause such defence should have already been resolved.

In the present case, the TC never categorically resolved theMotion to Dismiss but merely deferred resolution thereof.

The TC committed grave abuse of discretion in refusing to grantthe Motion to Set Preliminary Hearing for Affirmative Defense.Note that the TC deferred the resolution of the petitioners Motionto Dismiss due to a single issue (on whether or not the charter

party of the bill of lading is Baltimore Berth Grain Charter Party).TC had no cogent reason to deny the Motion for PreliminaryHearing for Affirmative Defense.

DISPOSITION:

WHEREFORE, the Petition is GRANTED and the appealeddecision is hereby REVERSED. The case is REMANDED to the trial court for

preliminary hearing on petitioners affirmative defense.

VOTE: 3rdDivision, Melo, Vitug,Gonzaga-Reyes, JJ., concur.

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Hilma A. NEEFUS vs Ralph L. NEEFUS, et al

(1941)

DOCTRINE: A sham answer is one which is sufficient on its face but isfalse in fact.

A frivolous answer is one that is lacking in legal sufficiency and which inany view of the facts pleaded does not present a defense.

A frivolous or sham answer may be stricken on motion and judgmentrendered notwithstanding the same as for want of an answer.

Failure to answer and contradict a showing that the allegations of an

answer are false must be taken as admitting the truth of the showing.

NATURE: Appeal from an order striking the Answers of the sureties assham and frivolous.

PONENTE: Peterson,J.

FACTS:

This is an action for breach of a defendants redelivery bond in areplevin action.

Plaintiff sued defendant Ralph L Neefus to recover possession ofcertain property.

Defendant was permitted to retain physical custody of the propertyunder a receipt which he gave the sheriff.

Defendant gave redelivery bond with defendants Hartwig andMcCormick as SURETIES.

Bond is in the penal sum of 1500USD, and is conditioned for thedelivery of the property subject of the replevin to the plaintiff if a

delivery was adjudged, and to pay to plaintiff such sum as for anycause may be recovered from the defendant.

Plaintiff recovere judgment in the replevin. The judgment wassatisfied to the extent of 11.80USD. After execution of judgment inreplevin, there was 453.76USD due plaintiff on the judgment. Soshe sues for the redelivery bond.

The sureties submitted identical Answers which indicated thattheir signatures were allegedly procured by the fraud of the

plaintiff and her agents. They said that there was a falserepresentation, that the only obligation under the bond was that

the property should remain on the premises of the defendant inthe replevin action and not be disposed of in any manner pendingthe action.

Plaintiffmoves to strike the Answers as sham and frivolous.She filed an Affidavit that the only person who was authorised to

represent her in connection with replevin action was her attorney,and neither her nor her attorney had anything to do with procuring

of the redelivery bond.

ISSUE/S: Was the order striking the Answers of the sureties as sham andfrivolous proper?

HELD: YES. The Answers of the sureties must be stricken as sham and

frivolous because one presented no defense and the facts of the other

were proven to be false.

RATIO/RULING:

A sham or a frivolous answer may be stricken on motionand judgment rendered notwithstanding the same as for

want of an answer. An answer is frivolous which appears froma bare inspection to be lacking in legal sufficiency and which in anyview of the facts pleaded does not present a defense. A shamanswer is one which is sufficient on its face but which is false infact.

The falsity of a pleading may be shown by affidavit. Where thefalsity of the facts pleaded is established by a clear and

unequivocal showing, the failure of the opposing parties to answerand contradict the showing must be taken as admitting the truth.Where the allegations of fact in a pleading are shown to be false,the pleading should be stricken as sham.

Defendants Hartwig and McCormicks Answers presented nodefense. The statements that they made in the Answers were

proven to be false.

DISPOSITION: Affirmed.