G.R. No.

121075 July 24, 1997

DELTA MOTORS CORPORATION, petitioner,
vs.
COURT OF APPEALS, HON. ROBERTO M. LAGMAN, and STATE INVESTMENT HOUSE,
INC., respondents.

DAVIDE, JR., J.:

FACTS
- Private Respondent State Investment House, Inc. filed action against DELTA for a sum of money at
the RTC of Manila, Branch VI. DELTA was required to pay P20M to the private respondent.
- The above decision could not be served by DELTA due to its dissolution. It had been taken over by
Philippine National Bank (PNB) in the meantime.
- Dec. 1986: SIHI moved for service of the decision by way of publication. It was published in the
Thunderer, a weekly Manila newspaper. Afterwards, SIHI moved for the execution, which the RTC
granted on March 1987. Pursuant to the writ of execution, properties of DELTA in Iloilo and Bacolod
City were levied upon and sold.
- DELTA commenced a special civil action for certiorari with the CA, alleging that a) the RTC did not
acquire jurisdiction over DELTA since there was no valid/proper service of summons rendering the
decision void, and b) the decision never became final and executory
- The CA ruled that against DELTA on the first ground, but ruled that the decision never became
executory because records show that the assailed judgment had never been properly served against on
PNB (which assumed DELTA’s operation upon its dissolution). The CA also stated that the
publication was not a cure for such a fatal defect.
- Therefore, the CA decreed that since the decision had not yet attained finality pending a service of a
copy on DELTA, who may appeal within the reglementary period.
- DELTA filed an MR, insisting there could be no valid service of summons since the RTC decision was
not in accordance with the Rules and hence void. Dismissed by CA
- DELTA filed a petition with the SC for review on certiorari. Denied.
- DELTA filed a Notice of Appeal with the RTC, indicating that it was appealing from the earlier
decision and prayed that records be elevated to the CA
- SIHI filed a motion to dismiss DELTA’s appeal on the grounds that it was filed out of time (beyond 15
days period after obtaining the copy of the decision). DELTA’s appeal was dismissed.
- DELTA filed an Omnibus motion with the CA to declare all acts and proceedings relating to the earlier
decision as void. The CA issued a resolution on Jan. 5 1995
- SIHI filed a motion for clarification, asking for a deletion of a portion of the resolution for it being
mere obiter dictum (“While it is true that as a necessary consequence the decision of the Court of
Appeals dated January 22, 1991 ruling that the decision in Civil Case No. 84-23019 "has not attained
finality pending service of a copy thereof on petitioner Delta, which may appeal therefrom within the
reglementary period", all proceedings and/or orders arising from the trial court's decision in Civil Case
No. 84-23019 are null and void x x x .”) SIHI claimed that the statement was “not necessary for the
case before it” (“the denial of the Omnibus motion” and therefore “could not be held binding for
establishing a precedent”).
- CA decreed to amend its resolution and delete the assailed paragraph

ISSUES/HELD
- WON the CA erred in denying the petitioner’s Omnibus motion?
a.) No, the CA was correct is denying the Omnibus motion
Sec. 7 of Rule 51 of the Rules of Court on the Procedure in the CA:
“Questions that may be decided – No error which does not affect the jursidiction over the subject
matter will be considered unless stated in the asdsignment of errors properly argued in the brief,
save as the court, at its option, may notice plain errors not specified, and also clerical errors.”

b.) The CA could only consider errors raised by the petitioner, which were only limited to the RTC’s
orders and not on the CA’s previous decisions.
 Even so, to allow DELTA’s Omnibus motion which it filed more than eight months after the
promulgation of the decision and long after its finality would result in the abandonment of sound
judicial process.

- WON the assailed paragraph in the CA’s resolution was obiter dictum?
a.) Yes, the assailed paragraph is considered obiter dictum.
1.) Obiter dictum – opinion expressed by a court upon some question of law which is not
necessary to the decision of the case before it; “by the way”. It is not binding as precedent (Cannot
be basis for stare decisis)

2.) The phrase was not raised by the petitioner expressly in its petition assailing the dismissal of its
notice of appeal. Hence, it could not be considered a prerequisite in disposing of the issues