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REMEDIAL LAW REVIEW

DIGESTS
ATTY. TRANQUIL SALVADOR III


MIDTERMS
COVERAGE:
Filing Fees
Jurisdiction
Rules 1 - 56

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RUBY SHELTER BUILDERS REALTY DEVT
CORPORATION V. FORMARAN

FACTS:
- Ruby Shelter obtained a loan from Tan and
Obiedo secured by a REM consisting of 5
parcels of land in the name of the former.
- Despite an extension granted by Tan and
Obiedo and several negotiations, Ruby was not
able to pay.
- Hence, Tan and Obiedo, by virtue of a MOA,
executed Deeds of Absolute sale in their favor
covering the 5 parcels of land. The MOA
provided that if Ruby fails to pay the loan, 5
deeds of absolute sale would be executed in
favor of Tan and Obiedo.
- So Ruby Shelter filed complaint for declaration
of nullity of the deeds. Believing that their
action was one which was incapable of
pecuniary estimation, they paid docket fees
amounting to about 13K. It said that it only
wanted to annul the deeds so no issue of title
or recovery of possession is present to classify
it as a real action.
- Tan and Obiedo moved to dismiss the
complaint and ask for damages (also pursuant
to the MOA there was a provision that if
Ruby Shelter brought suit against them, it
would be liable for P 10M) contending that the
RTC did not acquire jurisdiction over the case
because the case involved recovery of real
property making it a real action which requires
payment of docket fees equivalent to a
percentage of the fair market value of the land
(P 700K).
- RTC and CA ruled in favor of Tan and Obiedo
ordering Ruby Shelter to pay additional docket
fees. Hence, this petition.

ISSUE: W/N Ruby Shelter should pay additional docket
fees.

HELD/RATIO: YES. For the court to acquire jurisdiction,
docket fees must be paid first. Payment is mandatory
and jurisdictional.

To determine whether an action is real, it must affect
title to or recovery of possession of real property. In
this case, Ruby Shelter did not disclose certain facts
which would classify the complaint it filed as a real
action (like the execution of deeds of sale pursuant to
a MOA). The action was really one for recovery of
possession of the parcels of land. Hence, it is a real
action.

The docket fees for cases involving real property
depend on the fair market value (or the stated value)
of the same: the higher the value, the higher the fees
due. For those incapable of pecuniary estimation, a
fixed or flat rate is imposed.


MONTANER V. SHARIA DISTRICT COURT

Facts: Petitioner Luisa Montaner (Luisa), a Roman
Catholic, was married to deceased Alejandro Montaner
(Alejandro) at a Catholic Church . Private respondents
Liling Disangcopan (Disangcopan) and her daughter
Almahleen, both Muslims, filed a complaint for judicial
partition of properties before the Sharia District Court,
alleging (among others) that deceased Alejandro is a
Muslim and that they are his first family. Luisa filed an
Answer with a Motion to Dismiss on the grounds: 1.
Sharia has no jurisdiction because Alejandro is a
Roman Catholic; 2. Disangcopan failed to pay the
correct amount of docket fees; and 3. Complaint is
barred by prescription.
Sharia Court dismissed Luisas motion to dismiss. MR
denied.

Issue: W/N Disangcopans complaint for judicial
partition of properties should be dismissed by the
Sharia Court for failure to file the correct amount of
(insufficient) docket fees?

Held and Ratio: SC upheld Sharia Courts dismissal.
Allegation of insufficient payment of docket fees
involved two aspects: 1.Whether the Clerk of Court
correctly assessed the docket fees; and 2. Whether
Disangcopan paid the correct assessment of the docket
fees. Filing of the appropriate initiatory pleading and
the payment of the prescribed docket fees vest a trial
court with jurisdiction over the subject matter. If the
party filing the case paid less than the correct amount
for the docket fees because that was the amount
assessed by the Clerk of Court, the responsibility of
making a deficiency assessment lies with the same
Clerk of Court. In such a case, the lower court
concerned will not automatically lose jurisdiction
because the party filing the case cannot be penalized
with the Clerk of Courts insufficient assessment.
However, the party concerned will be required to pay
the deficiency. In this case, Luisa did not present the
Clerk of Courts assessment of the docket fees nor did
the records include this assessment, accordingly, there
could be no determination whether Disangcopan
correctly paid the docket fees without the Clerk of
Courts assessment.


PHILIPPINE FIRST INSURANCE VS. FIRST
LOGISTICS

FACTS: Pyramid Logistics and Trucking Corporation
(Pyramid) alleged in its complaint that its delivery van,
which was loaded with goods belonging to California
Manufacturing Corporation (CMC) valued at
907,149.07, left the CMC Bicutan Warehouse.
However, the van, together with the goods, failed to
reach its destination and its driver and helper were
nowhere to be found, to its damage and prejudice.
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It filed a criminal complaint against the driver
and helper for qualified theft, and a claim with
Philippine First Insurance Co., Inc., and Paramount
Insurance General Corporation as co-insurers for the
lost goods. However, the insurance companies refused
to compensate for the loss in violation of their
undertaking under the insurance policies. For this
reason, Pyramid suffered damages and was
constrained to engage the services of counsel to
enforce and protect its right to recover compensation
under the insurance policies, and for which services, it
obligated itself to pay the sum equivalent to 25% of
any recovery in the instant action, as and for
attorneys fees and legal expenses. It prayed that
judgment be rendered ordering the insurance
companies to comply with their obligation under their
respective insurance policies to pay to it jointly and
severally the sum of 50,000 plus 1,500 for each court
session attended by counsel until the case is
terminated as attorneys fees, and the costs of suit.
Pyramid was assessed a docket fee of 610 on the basis
of the amount of 50,000.
Pyramid later filed an amended complaint
containing minor changes in the body but bearing the
same prayer. Branch 148 of the Makati RTC, to which
the complaint was raffled, admitted the amended
complaint.
The insurance companies filed a motion to
dismiss on the ground of lack of jurisdiction, Pyramid
not having paid the docket fees in full. It argued that
in the body of its amended complaint, Pyramid alleged
that it suffered damages, but in the prayer, it
deliberately omitted to specify what these damages
are. This deliberate omission by Pyramid was intended
to evade the payment of the correct filing fee. The
insurance companies invoked the doctrine in
Manchester Development Corporation vs. CA that a
pleading which does not specify in the prayer the
amount sought shall not be admitted or shall otherwise
be expunged, and that the court acquires jurisdiction
only upon the payment of the prescribed docket fee.
Pyramid, on the other hand, insists the application of
Sun Insurance Office, Ltd. vs. Asuncion and
subsequent rulings relaxing the Manchester ruling by
allowing payment of the docket fee within a reasonable
time, in no case beyond the applicable prescriptive or
reglementary period, where the filing of the initiatory
pleading is not accompanied by the payment of the
prescribed docket fee.
The CA applied the liberal rule in Sun Insurance.

ISSUE: WON the CA erred in applying the liberal rule
in Sun Insurance???

RULING: YES, the CA erred. The Manchester rule
applies.
In the case of Tacay vs. Regional Trial Court of Tagum,
Davao del Norte, the SC clarified the effect of the Sun
Insurance ruling on the Manchester ruling as follows:
The requirement in Circular No. 7 that
complaints, petitions, answers, and similar
pleadings should specify the amount of damages
being prayed for not only in the body of the
pleading but also in the prayer, has not been
altered. What has been revised is the rule that
subsequent amendment of the complaint or similar
pleading will not thereby vest jurisdiction in the Court,
much less the payment of the docket fee based on the
amount sought in the amended pleading, the trial
court now being authorized to allow payment of the
fee within a reasonable time but in no case beyond
the applicable prescriptive period or reglementary
period. Moreover, a new rule has been added,
governing the awards of claims not specified in the
pleading i.e., damages arising after the filing of the
complaint or similar pleading as to which the
additional filing fee therefore shall constitute a lien on
the judgment.
In the case at bar, Pyramid failed to specify in
its prayer the amount of claims/damages it was
seeking both in the original and amended complaint. It
reasoned out that it was not aware of the extent of the
liability of the insurance companies under their
respective policies. It left the matter of liability to the
trial courts determination.
Even assuming that the amounts are yet to be
determined, the rule in Manchester, as modified by
Sun Insurance, still applies. In the case of Ayala
Corporation vs. Madayag, the SC pronounced the
following: While it is true that the determination of
certain damages x x x is left to the sound discretion of
the court, it is the duty of the parties claiming such
damages to specify the amount sought on the basis
of which the court may make a proper determination,
and for the proper assessment of the appropriate
docket fees. The exception contemplated as to
claims not specified or to claims although specified are
left for determination of the court is limited only to any
damages that may arise after the filing of the
complaint or similar pleading for then it will not be
possible for the claimant to specify nor speculate as to
the amount thereof.


BAUTISTA VS. UNANGST

Facts. On November 15, 1996, Hamilton Salak rented
a car from GAB Rent-A-Car, a car rental shop owned
by Benjamin Bautista. The lease was for 3 consecutive
days, P1,000.00 per day. However, Salak failed to
return the car after three (3) days prompting petitioner
to file a complaint against him for estafa, violation of
BP 22 and carnapping.
On February 2, 1997, Salak and his common-
law wife, respondent Shirley Unangst, were arrested
while riding the rented car along QC. The next day,
Bautista demanded from Salak the sum of
P232,372.00 as payment for car rental fees, fees
incurred in locating the car, attorney's fees, capital
gains tax, transfer tax, and other incidental expenses.
Salak and Unangst expressed willingness to
pay but since they were then short on cash, Salak
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proposed to sell to Bautista a house and lot. Bautista
welcomed the proposal after consulting his wife,
Cynthia. Cynthia, on the other hand, further agreed to
pay the mortgage loan of Unangst over the subject
property to a certain Jojo Lee in the amount of
P295,000.00.

Unangst and Bautista also executed a
separate deed of sale with right to repurchase.

Unangst failed to repurchase the property. As a
result, Bautista filed, on June 5, 1998, a complaint for
specific performance or recovery of possession, for
sum of money, for consolidation of ownership and
damages against Unangst and other unnamed persons
before the RTC of Olongapo. On the other hand,
respondents controverted the allegations in the
complaint.
RTC rendered a decision in favor of petitioner.
Respondents failed to interpose a timely appeal.
However, on September 10, 2004, Unangst filed a
petition for relief pursuant to Section 38 of the 1997
Rules on Civil Procedure. She argued that she learned
of the decision of the RTC only on September 6, 2004
when she received a copy of the motion for execution
filed by petitioner. Unangst initially paid P200.00 as
docket fees as this was the amount assessed by the
Clerk of Court of the RTC. Said amount was insufficient
as the proper filing fees amount to P1,715.00.
Nevertheless, the correct amount was subsequently
paid by said respondent on February 22, 2005, a little
less than 2 months after the period for filing the
petition lapsed. Petition was granted.
Bautista contends that respondents' "Petition
for Relief to Be Able to Appeal Judgment," which paved
the way for the allowance of respondents' appeal of
the RTC decision, was filed within the prescriptive
period but the proper docket fees for it were belatedly
paid. He thus posits that the RTC did not acquire
jurisdiction over said petition. Having no jurisdiction,
the RTC could not have allowed respondents to appeal

Issue. Whether the CA committed grave error in
finding that the respondent perfected an appeal via
Petition for Relief To Be Able To Appeal Judgment even
when the proper docket fees were paid beyond the
period prescribed. NO.

Held. Failure to pay the correct amount of docket fees
was due to a justifiable reason.
Indeed, the right to appeal is a purely
statutory right. Not being a natural right or a part of
due process, the right to appeal may be exercised only
in the manner and in accordance with the rules
provided therefor. For this reason, payment of the full
amount of the appellate court docket and other lawful
fees within the reglementary period is mandatory and
jurisdictional. Nevertheless, as this Court ruled
in Aranas v. Endona, the strict application of the
jurisdictional nature of the above rule on payment of
appellate docket fees may be mitigated under
exceptional circumstances to better serve the interest
of justice. It is always within the power of this Court to
suspend its own rules, or to except a particular case
from their operation, whenever the purposes of justice
require it.
In not a few instances, the Court relaxed the
rigid application of the rules of procedure to afford the
parties the opportunity to fully ventilate their cases on
the merits. This is in line with the time-honored
principle that cases should be decided only after giving
all parties the chance to argue their causes and
defenses. As early as 1946, in Segovia v. Barrios, the
Court ruled that where an appellant in good faith paid
less than the correct amount for the docket fee
because that was the amount he was required to pay
by the clerk of court, and he promptly paid the
balance, it is error to dismiss his appeal because
"(e)very citizen has the right to assume and trust that
a public officer charged by law with certain duties
knows his duties and performs them in accordance
with law. To penalize such citizen for relying upon said
officer in all good faith is repugnant to justice."
Technicality and procedural imperfections
should thus not serve as bases of decisions. In that
way, the ends of justice would be better served.
As regards the substantive issue, Unangst was
correct in alleging that the deed of sale with right to
repurchase qualifies as an equitable mortgage under
Article 1602. She merely secured the payment of the
unpaid car rentals and the amount advanced by
petitioner to Jojo Lee.


PROTON PILIPINAS V. BANQUE NACIONAL DE
PARIS

Facts:
Proton Pilipinas availed of credit facilities of
Banque Nacional de Paris (BNP).
Protons resulting debt of $2M was guaranteed
by Automotive Corporation Philippines, Asea
One Corp., and Autocorp Group.
BNP and Proton subsequently executed trust
receipt agreements, where Proton would
receive passenger motor vehicles in trust for
BNP, with the option to sell them, subject to
the condition that Proton would deliver the
proceeds of the sale to BNP, to be applied to
the formers debt. Vehicles remaining unsold
would be returned to BNP. Proton allegedly
failed to deliver.
BNP demanded from Protons corporate
guarantors $1.5M, the total outstanding
obligation. The guarantors refused. BNP filed a
complaint with the Makati RTC praying for
$1.5M plus accrued interest and other related
charges.
Respondent Proton filed a motion to dismiss,
contending that 1) BNP failed to pay the
correct docket fees which is supposed to
include interest, based on Admin Circ. No. 11-
94, and therefore the court could not have
acquired jurisdiction over the case, 2) the clerk
of court failed to apply the correct exchange
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rate, and that 3) since no demand letter was
given, the complaint was premature.
The court denied the petition, stating that the
petitioner properly paid the docket fees. It
stated that Section 7(a) of Rule 141 of the
Rules of Court excludes interest accruing from
the principal amount being claimed in the
pleading in the computation of the prescribed
filing fees. It court further added that
assuming the correct filing fees were not paid,
the rule is that the court may allow a
reasonable time for the payment of the
prescribed fees, or the balance thereof, and
upon such payment, the defect is cured and
the court may properly take cognizance of the
action, unless in the meantime prescription has
set in and consequently barred the right of
action.
Regarding the correct dollar-peso rate of
exchange, the Office of the Clerk of Court of
the RTC of Makati pegged it at P 43.00 to
US$1. Absent any office guide of the rate of
exchange which said court functionary was
duty bound to follow, the rate he applied is
presumptively correct.
With regard to the demand letter, the court
said that the failure to make a formal demand
is not among the legal grounds for the
dismissal of the case.

Issues:
1) Whether BNP failed to pay the correct docket
fees
2) Whether the Clerk of court applied the wrong
exchange rate
3) Whether the amount of interest was not
specified in the prayer, rendering the
complaint void.

Held:
1) Petitioner relied on a case decided in 1989 where
Rule 141 was applied, the interest and costs
having been excluded in the computation of the
aggregate amount. However, the present case was
filed in 1998, when such rule had already been
amended by Administrative Circular No. 11-94.
The amended rule includes the interest, damages
of whatever kind, attorneys fees, litigation
expenses, and other costs in the computation of
the aggregate amount. In the complaint,
respondent prayed for accrued interest
subsequent to August 15, 1998 until fully paid.
The complaint having been filed on September 7,
1998, respondents claim includes the interest from
August 16, 1998 until such date of filing.
Respondent not having paid the fees for such,
cannot claim the interest within such duration,
unless respondent is allowed by motion to amend
its complaint within a reasonable time and specify
the precise amount of interest petitioners owe
within the period and pay the corresponding
docket fee.

With respect to the interest accruing after the filing
of the complaint, the same can only be determined
after a final judgment has been handed down.
Respondent cannot thus be made to pay the
corresponding docket fee. Pursuant, however, to
Section 2, Rule 141, as amended by Administrative
Circular No. 11-94, respondent should be made to
pay additional fees which shall constitute a lien in
the event the trial court adjudges that it is entitled
to interest accruing after the filing of the
complaint.

2) In the Clerk of Courts application of exchange
rate, the presumption of regularity is disputable,
not conclusive. Petitioners have presented
rebutting evidence that the exchange rate when
the case was filed was P43.21 to US$1, not
P43.00. Thus, the docket fees were insufficient.
However, the trial court did acquire
jurisdiction. Respondent merely relied on the
assessment made by the Clerk of court. In such a
case, where there exists no effort in defrauding the
government, respondent even demonstrating his
willingness to abide by the rules by paying the
additional docket fees as required, the court
acquires jurisdiction.

3) Where the trial court acquires jurisdiction over a
claim by the filing of the appropriate pleading and
payment of the prescribed filing fee but,
subsequently, the judgment awards a claim not
specified in the pleading, or if specified, has been
left for determination by the court, the additional
filing fee shall constitute a lien on the judgment. It
shall be the responsibility of the Clerk of Court or
his duly authorized deputy to enforce said lien and
assess and collect the additional fee. The amount
of any claim for damages, therefore, arising on or
before the filing of the complaint or any pleading
should be specified. While the determination of
certain damages is left to the discretion of the
court, it is the duty of the parties claiming such
damages to specify the amount sought on the
basis of which the court may make a proper
determination, and for the proper assessment of
the appropriate docket fees. The exception to the
rule is limited only to any damages that may arise
after the filing of the complaint or similar pleading
for then it will not be possible for the claimant to
specify nor speculate as to the amount thereof.
Petition is partially granted. The Clerk of Court
is ordered to reassess and determine the docket
fees that should be paid by respondent within
fifteen (15) days, provided the applicable
prescriptive or reglementary period has not yet
expired.


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A.M. No. 08-11-7-SC
RE: REQUEST OF NATIONAL COMMITTEE ON
LEGAL AID TO EXEMPT LEGAL AID CLIENTS FROM
PAYING FILING, DOCKET AND OTHER FEES.

On September 23, 2008 the Misamis Oriental Chapter
of the Integrated Bar of the Philippines (IBP)
promulgated Resolution No. 24. The resolution
requested the IBPs National Committee on Legal Aid
(NCLA) to ask for the exemption from the payment of
filing, docket and other fees of clients of the legal aid
offices in the various IBP chapters like the exemption
granted to PAO clients under RA 9406. The Court
lauded the Misamis Oriental Chapter of the IBP for its
effort to help improve the administration of justice,
particularly, the access to justice by the poor. In
promulgating Resolution No. 24, the Misamis Oriental
Chapter of the IBP has effectively performed its duty to
"participate in the development of the legal system by
initiating or supporting efforts in law reform and in the
administration of justice."
In approving the Rule, the Court stressed that
the Constitution guarantees the rights of the poor to
free access to the courts and to adequate legal
assistance. It found the legal aid service rendered by
the NCLA and legal aid offices of IBP chapters
nationwide addresses the right to adequate legal
assistance and that the recipients of the service of the
NCLA and legal aid offices of IBP Chapters may enjoy
free access to courts by exempting them from the
payment of fees assessed in connection with the filing
of a complaint or action in court. The Court held that
with these twin initiatives, the guarantee of Section
11, Article III of the Constitution is advanced and
access to justice is increased by bridging a significant
gap and removing a major roadblock.
The Court concluded with a declaration that
access to justice is essential in a democracy and in
the rule of law. Recognizing the right of access to
justice as the most important pillar of legal
empowerment of the marginalized sectors of our
society, it has exercised its power to promulgate
rules concerning the protection and enforcement of
constitutional rights to open the doors of justice to the
underprivileged and to allow them to step inside the
court to be heard of their plaints.

A.M. No. 08-11-7-SC (IRR): Re: Rule on the
Exemption From the Payment of Legal Fees of
the Clients of the National Committee on Legal
Aid and of the Legal Aid Offices in the Local
Chapters of the Integrated Bar of the Philippines

Rule on the Exemption From the Payment of
Legal Fees of the Clients of the National
Committee on Legal Aid (NCLA) and of the Legal
Aid Offices in the Local Chapters of the
Integrated Bar of the Philippines (IBP)

ARTICLE I
Purpose

Section 1. Purpose. This Rule is issued for the
purpose of enforcing the right of free access to courts
by the poor guaranteed under Section 11, Article III of
the Constitution. It is intended to increase the access
to justice by the poor by exempting from the payment
of legal fees incidental to instituting an action in court,
as an original proceeding or on appeal, qualified
indigent clients of the NCLA and of the legal aid offices
in local IBP chapters nationwide.

ARTICLE II
Definition of Terms

Section 1. Definition of important terms. For
purposes of this Rule and as used herein, the following
terms shall be understood to be how they are defined
under this Section:
(a) "Developmental legal aid" means the rendition of
legal services in public interest causes involving
overseas workers, fisherfolk, farmers, laborers,
indigenous cultural communities, women, children and
other disadvantaged groups and marginalized sectors;
(b) "Disinterested person" refers to the punong
barangay having jurisdiction over the place where an
applicant for legal aid or client of the NCLA or chapter
legal aid office resides;
(c) "Falsity" refers to any material misrepresentation of
fact or any fraudulent, deceitful, false, wrong or
misleading statement in the application or affidavits
submitted to support it or the affidavit of a
disinterested person required to be submitted annually
under this Rule which may substantially affect the
determination of the qualifications of the applicant or
the client under the means and merit tests;
(d) "Legal fees" refers to the legal fees imposed under
Rule 141 of the Rules of Court as a necessary incident
of instituting an action in court either as an original
proceeding or on appeal. In particular, it includes filing
or docket fees, appeal fees, fees for issuance of
provisional remedies, mediation fees, sheriffs fees,
stenographers fees (that is fees for transcript of
stenographic notes) and commissioners fees;
(e) "Means test" refers to the set of criteria used to
determine whether the applicant is one who has no
money or property sufficient and available for food,
shelter and basic necessities for himself and his family;
(f) "Merit test" refers to the ascertainment of whether
the applicants cause of action or his defense is valid
and whether the chances of establishing the same
appear reasonable and
(g) "Representative" refers to the person authorized to
file an application for legal aid in behalf of the
applicant when the said applicant is prevented by a
compelling reason from personally filing his
application. As a rule, it refers to the immediate family
members of the applicant. However, it may include any
of the applicants relatives or any person or concerned
citizen of sufficient discretion who has first-hand
knowledge of the personal circumstances of the
applicant as well as of the facts of the applicants case.
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ARTICLE III
Coverage

Section 1. Persons qualified for exemption from
payment of legal fees. Persons who shall enjoy the
benefit of exemption from the payment of legal fees
incidental to instituting an action in court, as an
original proceeding or on appeal, granted under this
Rule shall be limited only to clients of the NCLA and
the chapter legal aid offices.
The said clients shall refer to those indigents qualified
to receive free legal aid service from the NCLA and the
chapter legal aid offices. Their qualifications shall be
determined based on the tests provided in this Rule.

Section 2. Persons not covered by the Rule. The
following shall be disqualified from the coverage of this
Rule. Nor may they be accepted as clients by the NCLA
and the chapter legal aid offices.
(a) Juridical persons; except in cases covered by
developmental legal aid or public interest causes
involving juridical entities which are non-stock, non-
profit organizations, non-governmental organizations
and peoples organizations whose individual members
will pass the means test provided in this Rule;
(b) Persons who do not pass the means and merit
tests;
(c) Parties already represented by a counsel de parte;
(d) Owners or lessors of residential lands or buildings
with respect to the filing of collection or unlawful
detainer suits against their tenants and
(e) Persons who have been clients of the NCLA or
chapter legal aid office previously in a case where the
NCLA or chapter legal aid office withdrew its
representation because of a falsity in the application or
in any of the affidavits supporting the said application.

Section 3. Cases not covered by the Rule. The NCLA
and the chapter legal aid offices shall not handle the
following:
(a) Cases where conflicting interests will be
represented by the NCLA and the chapter legal aid
offices and
(b) Prosecution of criminal cases in court.

ARTICLE IV
Tests of Indigency

Section 1. Tests for determining who may be clients of
the NCLA and the legal aid offices in local IBP chapters.
The NCLA or the chapter legal aid committee, as the
case may be, shall pass upon requests for legal aid by
the combined application of the means and merit tests
and the consideration of other relevant factors
provided for in the following sections.

Section 2. Means test; exception. (a) This test shall
be based on the following criteria: (i) the applicant and
that of his immediate family must have a gross
monthly income that does not exceed an amount
double the monthly minimum wage of an employee in
the place where the applicant resides and (ii) he does
not own real property with a fair market value as
stated in the current tax declaration of more than
Three Hundred Thousand (P300,000.00) Pesos.
In this connection, the applicant shall execute
an affidavit of indigency (printed at the back of the
application form) stating that he and his immediate
family do not earn a gross income abovementioned,
nor own any real property with the fair value
aforementioned, supported by an affidavit of a
disinterested person attesting to the truth of the
applicants affidavit. The latest income tax return
and/or current tax declaration, if any, shall be attached
to the applicants affidavit.
(b) The means test shall not be applicable to applicants
who fall under the developmental legal aid program
such as overseas workers, fisherfolk, farmers,
laborers, indigenous cultural communities, women,
children and other disadvantaged groups.

Section 3. Merit test. A case shall be considered
meritorious if an assessment of the law and evidence
at hand discloses that the legal service will be in aid of
justice or in the furtherance thereof, taking into
consideration the interests of the party and those of
society. A case fails this test if, after consideration of
the law and evidence presented by the applicant, it
appears that it is intended merely to harass or injure
the opposite party or to work oppression or wrong.

Section 4. Other relevant factors that may be
considered. The effect of legal aid or of the failure to
render the same upon the rule of law, the proper
administration of justice, the public interest involved in
a given case and the practice of law in the locality shall
likewise be considered.

ARTICLE V
Acceptance and Handling of Cases

Section 1. Procedure in accepting cases. The
following procedure shall be observed in the
acceptance of cases for purposes of this Rule:
(a) Filing of application An application shall be made
personally by the applicant, unless there is a
compelling reason which prevents him from doing so,
in which case his representative may apply for him. It
shall adhere substantially to the form made for that
purpose. It shall be prepared and signed by the
applicant or, in proper cases, his duly authorized
representative in at least three copies.
Applications for legal aid shall be filed with the NCLA or
with the chapter legal aid committee.
The NCLA shall, as much as possible, concentrate on
cases of paramount importance or national impact.
Requests received by the IBP National Office shall be
referred by the NCLA to the proper chapter legal aid
committee of the locality where the cases have to be
filed or are pending. The chapter president and the
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chairman of the chapters legal aid committee shall be
advised of such referral.
(b) Interview The applicant shall be interviewed by a
member of the chapter legal aid committee or any
chapter member authorized by the chapter legal aid
committee to determine the applicants qualifications
based on the means and merit tests and other relevant
factors. He shall also be required to submit copies of
his latest income tax returns and/or current tax
declaration, if available, and execute an affidavit of
indigency printed at the back of the application form
with the supporting affidavit of a disinterested person
attesting to the truth of the applicants affidavit.lawph!l
After the interview, the applicant shall be informed
that he can follow up the action on his application after
five (5) working days.
(c) Action on the application The chapter legal aid
committee shall pass upon every request for legal aid
and submit its recommendation to the chapter board of
officers within three (3) working days after the
interview of the applicant. The basis of the
recommendation shall be stated.
The chapter board of officers shall review and act on
the recommendation of the chapter legal aid
committee within two (2) working days from receipt
thereof; Provided, however, that in urgent matters
requiring prompt or immediate action, the chapters
executive director of legal aid or whoever performs his
functions may provisionally act on the application,
subject to review by the chapter legal aid committee
and, thereafter, by the chapter board of officers.
The action of the chapter board of officers on the
application shall be final.
(d) Cases which may be provisionally accepted. In
the following cases, the NCLA or the chapter legal aid
office, through the chapters executive director of legal
aid or whoever performs his functions may accept
cases provisionally pending verification of the
applicants indigency and an evaluation of the merit of
his case.
(i) Where a warrant for the arrest of the applicant has
been issued;
(ii) Where a pleading has to be filed immediately to
avoid adverse effects to the applicant;
(iii) Where an appeal has to be urgently perfected or a
petition for certiorari, prohibition or mandamus filed
has to be filed immediately; and
(iv) Other similar urgent cases.
(e) Assignment of control number Upon approval of
the chapter board of officers of a persons application
and the applicant is found to be qualified for legal
assistance, the case shall be assigned a control
number. The numbering shall be consecutive starting
from January to December of every year. The control
number shall also indicate the region and the chapter
handling the case.
(f) Issuance of a certification After an application is
approved and a control number duly assigned, the
chapter board of officers shall issue a certification that
the person (that is, the successful applicant) is a client
of the NCLA or of the chapter legal aid office. The
certification shall bear the control number of the case
and shall state the name of the client and the nature of
the judicial action subject of the legal aid of the NCLA
or the legal aid office of a local IBP chapter.
The certification shall be issued to the successful
applicant free of charge.

Section 2. Assignment of cases. After a case is given
a control number, the chapter board of officers shall
refer it back to the chapter legal aid committee. The
chapter legal aid committee shall assign the case to
any chapter member who is willing to handle the case.
handle the case voluntarily, the chapter legal
aid committee shall refer the matter to the chapter
board of officers together with the names of at least
three members who, in the chapter legal aid
committees discretion, may competently render legal
aid on the matter. The chapter board of officers shall
appoint one chapter member from among the list of
names submitted by the chapter legal aid committee.
The chapter member chosen may not refuse the
appointment except on the ground of conflict of
interest or other equally compelling grounds as
provided in the Code of Professional Responsibility,19
in which case the chapter board of officers shall
appoint his replacement from among the remaining
names in the list previously submitted by the chapter
legal aid committee.
The chapter legal aid committee and the
chapter board of officers shall take the necessary
measures to ensure that cases are well-distributed to
chapter members.

Section 3. Policies and guidelines in the acceptance
and handling of cases. The following policies and
guidelines shall be observed in the acceptance and
handling of cases:
(a) First come, first served Where both the
complainant/plaintiff/petitioner and defendant/
respondent apply for legal aid and both are qualified,
the first to seek assistance shall be given preference.
(b) Avoidance of conflict of interest Where
acceptance of a case will give rise to a conflict of
interest on the part of the chapter legal aid office, the
applicant shall be duly informed and advised to seek
the services of a private counsel or another legal aid
organization.
Where handling of the case will give rise to a conflict of
interest on the part of the chapter member assigned to
the case, the client shall be duly informed and advised
about it. The handling lawyer shall also inform the
chapter legal aid committee so that another chapter
member may be assigned to handle the case. For
purposes of choosing the substitute handling lawyer,
the rule in the immediately preceding section shall be
observed.
(c) Legal aid is purely gratuitous and honorary No
member of the chapter or member of the staff of the
NCLA or chapter legal aid office shall directly or
indirectly demand or request from an applicant or
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client any compensation, gift or present for legal aid
services being applied for or rendered.
(d) Same standard of conduct and equal treatment A
chapter member who is tasked to handle a case
accepted by the NCLA or by the chapter legal aid office
shall observe the same standard of conduct governing
his relations with paying clients. He shall treat the
client of the NCLA or of the chapter legal aid office and
the said clients case in a manner that is equal and
similar to his treatment of a paying client and his case.
(e) Falsity in the application or in the affidavits Any
falsity in the application or in the affidavit of indigency
or in the affidavit of a disinterested person shall be
sufficient cause for the NCLA or chapter legal aid office
to withdraw or terminate the legal aid. For this
purpose, the chapter board of officers shall authorize
the handling lawyer to file the proper manifestation of
withdrawal of appearance of the chapter legal aid office
in the case with a motion for the dismissal of the
complaint or action of the erring client. The court, after
hearing, shall approve the withdrawal of appearance
and grant the motion, without prejudice to whatever
criminal liability may have been incurred.
Violation of this policy shall disqualify the erring client
from availing of the benefits of this Rule in the future.
(f) Statement in the initiatory pleading To avail of
the benefits of the Rule, the initiatory pleading shall
state as an essential preliminary allegation that (i) the
party initiating the action is a client of the NCLA or of
the chapter legal aid office and therefore entitled to
exemption from the payment of legal fees under this
Rule and (ii) a certified true copy of the certification
issued pursuant to Section 1(e), of this Article is
attached or annexed to the pleading.
Failure to make the statement shall be a ground for
the dismissal of the action without prejudice to its
refiling.
The same rule shall apply in case the client, through
the NCLA or chapter legal aid office, files an appeal.
(g) Attachment of certification in initiatory pleading A
certified true copy of the certification issued pursuant
to Section 1(e), of this Article shall be attached as an
annex to the initiatory pleading.
Failure to attach a certified true copy of the said
certification shall be a ground for the dismissal of the
action without prejudice to its refiling.
The same rule shall apply in case the client, through
the NCLA or chapter legal aid office, files an appeal.
(h) Signing of pleadings All complaints, petitions,
answers, replies, memoranda and other important
pleadings or motions to be filed in courts shall be
signed by the handling lawyer and co-signed by the
chairperson or a member of the chapter legal aid
committee, or in urgent cases, by the executive
director of legal aid or whoever performs his functions.
Ordinary motions such as motions for extension of
time to file a pleading or for postponement of hearing
and manifestations may be signed by the handling
lawyer alone.
(i) Motions for extension of time or for postponement
The filing of motions for extension of time to file a
pleading or for postponement of hearing shall be
avoided as much as possible as they cause delay to the
case and prolong the proceedings.
(j) Transfer of cases Transfer of cases from one
handling lawyer to another shall be affected only upon
approval of the chapter legal aid committee.

Section 4. Decision to appeal. (a) All appeals must
be made on the request of the client himself. For this
purpose, the client shall be made to fill up a request to
appeal.
(b) Only meritorious cases shall be appealed. If the
handling lawyer, in consultation with the chapter legal
aid committee, finds that there is no merit to the
appeal, the client should be immediately informed
thereof in writing and the record of the case turned
over to him, under proper receipt. If the client insists
on appealing the case, the lawyer handling the case
should perfect the appeal before turning over the
records of the case to him.

Section 5. Protection of private practice. Utmost care
shall be taken to ensure that legal aid is neither
availed of to the detriment of the private practice of
law nor taken advantage of by anyone for purely
personal ends.

ARTICLE VI
Withdrawal of Legal Aid and Termination of
Exemption

Section 1. Withdrawal of legal aid. The NCLA or the
chapter legal aid committee may, in justifiable
instances as provided in the next Section, direct the
handling lawyer to withdraw representation of a
clients cause upon approval of the IBP Board of
Governors (in the case of the NCLA) or of the chapter
board of officers (in the case of the chapter legal aid
committee) and through a proper motion filed in Court.

Section 2. Grounds for withdrawal of legal aid.
Withdrawal may be warranted in the following
situations:
(a) In a case that has been provisionally accepted,
where it is subsequently ascertained that the client is
not qualified for legal aid;
(b) Where the clients income or resources improve
and he no longer qualifies for continued assistance
based on the means test. For this purpose, on or
before January 15 every year, the client shall submit
an affidavit of a disinterested person stating that the
client and his immediate family do not earn a gross
income mentioned in Section 2, Article V, nor own any
real property with the fair market value mentioned in
the same Section;
(c) When it is shown or found that the client
committed a falsity in the application or in the
affidavits submitted to support the application;
(d) When the client subsequently engages a de parte
counsel or is provided with a de oficio counsel;
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(e) When, despite proper advice from the handling
lawyer, the client cannot be refrained from doing
things which the lawyer himself ought not do under the
ethics of the legal profession, particularly with
reference to their conduct towards courts, judicial
officers, witnesses and litigants, or the client insists on
having control of the trial, theory of the case, or
strategy in procedure which would tend to result in
incalculable harm to the interests of the client;
(f) When, despite notice from the handling lawyer, the
client does not cooperate or coordinate with the
handling lawyer to the prejudice of the proper and
effective rendition of legal aid such as when the client
fails to provide documents necessary to support his
case or unreasonably fails to attend hearings when his
presence thereat is required; and
(g) When it becomes apparent that the representation
of the clients cause will result in a representation of
conflicting interests, as where the adverse party had
previously engaged the services of the NCLA or of the
chapter legal aid office and the subject matter of the
litigation is directly related to the services previously
rendered to the adverse party.

Section 3. Effect of withdrawal. The court, after
hearing, shall allow the NCLA or the chapter legal aid
office to withdraw if it is satisfied that the ground for
such withdrawal exists.
Except when the withdrawal is based on
paragraphs (b), (d) and (g) of the immediately
preceding Section, the court shall also order the
dismissal of the case. Such dismissal is without
prejudice to whatever criminal liability may have been
incurred if the withdrawal is based on paragraph (c) of
the immediately preceding Section.

ARTICLE VII
Miscellaneous Provisions

Section 1. Lien on favorable judgment. The amount
of the docket and other lawful fees which the client
was exempted from paying shall be a lien on any
judgment rendered in the case favorable to the
indigent, unless the court otherwise provides.
In case, attorneys fees have been awarded to
the client, the same shall belong to the NCLA or to the
chapter legal aid office that rendered the legal aid, as
the case may be. It shall form part of a special fund
which shall be exclusively used to support the legal aid
program of the NCLA or the chapter legal aid office. In
this connection, the chapter board of officers shall
report the receipt of attorneys fees pursuant to this
Section to the NCLA within ten (10) days from receipt
thereof. The NCLA shall, in turn, include the data on
attorneys fees received by IBP chapters pursuant to
this Section in its liquidation report for the annual
subsidy for legal aid.

Section 2. Duty of NCLA to prepare forms. The NCLA
shall prepare the standard forms to be used in
connection with this Rule. In particular, the NCLA shall
prepare the following standard forms: the application
form, the affidavit of indigency, the supporting
affidavit of a disinterested person, the affidavit of a
disinterested person required to be submitted annually
under Section 2(b), Article VI, the certification issued
by the NCLA or the chapter board of officers under
Section 1(f), Article V and the request to appeal.
The said forms, except the certification, shall be in
Filipino. Within sixty (60) days from receipt of the
forms from the NCLA, the chapter legal aid offices shall
make translations of the said forms in the dominant
dialect used in their respective localities.

Section 3. Effect of Rule on right to bring suits in forma
pauperis. Nothing in this Rule shall be considered to
preclude those persons not covered either by this Rule
or by the exemption from the payment of legal fees
granted to clients of the Public Attorneys Office under
Section 16-D of RA 9406 to litigate in forma pauperis
under Section 21, Rule 3 and Section 19 Rule 141 of
the Rules of Court.

Section 4. Compliance with Rule on Mandatory Legal
Aid Service. Legal aid service rendered by a lawyer
under this Rule either as a handling lawyer or as an
interviewer of applicants under Section 1(b), Article IV
hereof shall be credited for purposes of compliance
with the Rule on Mandatory Legal Aid Service.
The chairperson of the chapter legal aid office shall
issue the certificate similar to that issued by the Clerk
of Court in Section 5(b) of the Rule on Mandatory
Legal Aid Service.

ARTICLE VIII
Effectivity
Section 1. Effectivity. This Rule shall become
effective after fifteen days following its publication in a
newspaper of general circulation.
The above rule, in conjunction with Section 21, Rule 3
and Section 19, Rule 141 of the Rules of Court, the
Rule on Mandatory Legal Aid Service and the Rule of
Procedure for Small Claims Cases, shall form a solid
base of rules upon which the right of access to courts
by the poor shall be implemented. With these rules, we
equip the poor with the tools to effectively, efficiently
and easily enforce their rights in the judicial system.


Re: Query of Mr. Roger Prioreschi (exemption
from legal and filing fees of the Good Shepherd
Foundation)

Facts: Roger was the administrator of the Good
Shepherd Foundation. As such administrator, he wrote
a letter to the Chief Justice (this was 2009 so Puno). In
essence, the letter stated the ff:
1) They were thanking the court for their 1
st

indorsement that the foundation pays the nominal fee
of P5000 and balance upon collection action of P10M.
2) Court Administrator Jose Perez pointed out
the need to comply with OCA Circular No.42-2005 and
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Rule141 that reserves this privilege --- exemption
from filing fees --- to indigent persons. However, the
law mainly deals with an individual indigent and does
not include foundations or associations that work with
and for indigent persons.
3) It was noted that the Good Shepherd
Foundation reach out to the poorest of the poor, newly
born and abandoned babies, children who never saw a
smile of their mother, old people who cannot afford to
pay for common prescriptions, broken families...etc.
4) They were asking the courts to grant to the
foundation the same option to be exempted from filing
fees as given to indigent people (2 executive judges
they previously approached disapproved this
interpretation).

Issue: Whether the special privilege (referring to the
exemption from filing fees) granted under Rule141 and
OCA Circular is applicable to foundations/associations?

Held: NO!
The basis for the exemption from legal and
filing fees is the free access clause under Sec11, Art3
of the Consti. Free access to the courts and quasi
judicial bodies and adequate legal assistance shall not
be denied to any person by reason of poverty. This
provision is very important. In fact, a move that it be
removed because it was already covered by the equal
protection clause was defeated.
To implement the free access clause, SC
promulgated Sec21, Rul3 and Sec19, Rule141 of the
Rules of Court. (very long provisions so I wont put it
here but you have to read it) The clear intent and
precise language of the provisions indicate that only a
natural party litigant may be regarded as an indigent
litigant.
Good Shepherd Foundation is a corporation
with a separate and distinct juridical personality and as
such cannot be exempted from legal and filing fees.
This is the ruling even if the foundation is working for
indigent and underprivileged people. The Consti
premised the free access clause on a persons poverty
which only a natural person can suffer.
Another reason why the exemption cannot be granted
to juridical persons even if they work for indigent and
underprivileged people is because it may be prone to
abuse. Also, the scrutiny of compliance with the
documentation requirements may prove too time
consuming and wasteful for the courts.

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THORNTON VS. THORNTON

FACTS: American husband and Filipina wife got
married here and had a daughter. Three years into
the marriage, wife became bored as a housewife and
wanted to go back to her life as a GRO. Because of
this, their relationship turned sour and one day, the
wife left the family home with her daughter without
notifying her husband.
Husband filed a petition for habeas corpus
before the Family Court of Makati. Dismissed since the
child daw was in Basilan and hence it did not have
jurisdiction. Husband went to Basilan but could not
find his wife and child there. He had a lead that his
wife and child may be somewhere in Cavite, Nueva
Ecija, or Manila.
Therefore, he filed a petition for habeas corpus
before the CA (para enforceable within the country)
but CA denied the petition, claiming that it does not
have jurisdiction because the Family Courts Act (which
gave the FC jurisdiction regarding petition for habeas
corpus in cases involving custody of minors) impliedly
repealed BP129 (which gave CA jurisdiction over
habeas corpus cases)
CA: Family Courts Act (RA 8369) uses the
word exclusive in granting the FC jurisdiction over
habeas corpus cases.

Issue: Does CA have jurisdiction over habeas corpus
cases involving custody of minors? YES.

SC: The CA should take cognizance of the case since
there is nothing in RA 8369 that revoked its jurisdiction
to issue writs of habeas corpus involving the custody of
minors.
CAs reasoning will result in an iniquitous
situation, leaving individuals like petitioner without
legal recourse in obtaining custody of their children.
Individuals who do not know the whereabouts of
minors they are looking for would be helpless since
they cannot seek redress from family courts whose
writs are enforceable only in their respective territorial
jurisdictions. Thus, if a minor is being transferred from
one place to another, which seems to be the case
here, the petitioner in a habeas corpus case will be left
without legal remedy.
The primordial consideration is the welfare and
best interests of the child. In the case at bar, a literal
interpretation of the word exclusive will result in
grave injustice and negate the policy to protect the
rights and promote the welfare of children under the
Constitution and the United Nations Convention on the
Rights of the Child. This mandate must prevail over
legal technicalities and serve as the guiding principle in
construing the provisions of RA 8369.
The provisions of RA 8369 reveal no manifest
intent to revoke the jurisdiction of the CA and SC to
issue writs of habeas corpus relating to the custody of
minors. Further, it cannot be said that the
provisions of RA 8369 and BP 129 are absolutely
incompatible since RA 8369 does not prohibit the CA
and the SC from issuing writs of habeas corpus in
cases involving the custody of minors.
In any case, whatever uncertainty there was
has been settled with the adoption of A.M. No. 03-03-
04-SC Re: Rule on Custody of Minors and Writ of
Habeas Corpus in Relation to Custody of
Minors(SEC20: The petition may likewise be filed with
the SC, CA, or with any of its members and, if so
granted, the writ shall be enforceable anywhere in the
Philippines.


FAR EAST BANK VS. SHEMBERG | SANDOVAL-
GUTIERREZ

FACTS
Respondents are the registered owners of a parcel
of several realties located in Mandaue City. Prior to
1998, respondents entered into several credit
transactions with petitioner secured by several real
estate mortgage. Respondents failed to pay the
loans thus the petitioner sought to foreclose the
mortgage.
On February 28, respondents filed with the RTC a
Complaint for Declaratory Relief, Injunction,
Damages, Annulment of Promissory Notes,
Documents, and Contracts against petitioner. They
allege that prior to 1998, respondents obtained
credit accommodations from petitioner. The latter
required the respondents representatives to sign
standard pre-printed bank forms in fine print.
Respondents complied since they trusted
petitioner. However, it turned out that petitioners
employees filled the blanks with false and
inaccurate entries.Respondents deny and dispute
the genuineness and due execution of the
documents and pray for the following relief: ex-
parte TRO and thereafter upon summary hearing
TRO for 20 days, preliminary injunction issued
upon posting of bond enjoining defendant, etc.
On March 9, the trial court issued an order
granting respondents order for the issuance of a
TRO. Petitioner filed its Answer with Affirmative
Defenses, Counterclaim, Vigorous Opposition to
the Order directing the issuance of a TRO and/or
preliminary mandatory injunction. Likewise,
petitioner filed a Motion to Dismiss Based on
Affirmative Defense alleging that 1.) the venue is
improperly laid; 2.) the trial court did not acquire
jurisdiction over the case for non-payment of
docket fees; 3.) there is non-joinder of
indispensable parties; and 4.) the trial court has no
jurisdiction to enjoin the foreclosure proceedings.
On March 27, the trial court issued an order
denying petitioners motion to dismiss. Venue has
been properly laid. Records show, as well as
defendants annexes to its answer admits, that the
plaintiffs business address and principal place of
business are at Mandaue City. Likewise, similarly
situated are the properties sought to be foreclosed.
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Jurisdiction
It is to be noted that the question of jurisdiction
has not been raised by defendant except with the
cause of action regarding annulment of mortgages
on defendants insistence that the tax declaration
attached is not the latest. Considering however
that annulment of mortgage is incapable of
pecuniary estimation the court feels that
jurisdiction is proper since, according to
jurisprudence, what determines the nature of an
action and the court which has jurisdiction over it
are the allegations made by the plaintiff. Evidence
has not been introduced, to the satisfaction of the
court that indeed Far East Bank and Trust
Company no longer exists and BPI has taken over
its assets and liabilities. Besides, the commercial
linkage was between FEBTX and Shemberg as
records show. It is an inherent power of the court
concomitant to its very existence to issue
provisional remedies to protect the rights and
interest of parties pending litigation.
The motion for reconsideration was denied thus the
petitioner filed with the Court of Appeals a petition
for certiorari, prohibition and mandamus
contending that the trial court acted with grave
abuse of discretion amounting to lack or excess of
jurisdiction. The CA dismissed the petition for
certiorari as well as the motion for reconsideration.
Thus this petition.

ISSUES & ARGUMENTS
W/N the trial court has jurisdiction
o Petitioner: In real actions, the
assessed value of the property or if
there is none, the estimated value
thereof, must be alleged in the
complaint and shall serve as the basis
for computing the fees
o Respondents: Since the suit primarily
involves cancellation of mortgages, an
action incapable of pecuniary
estimation, there is no deficiency in
the payment of docket fees
W/N petitioner bank is entitled to writs of
certiorari, prohibition, and mandamus

HOLDING & RATIO DECIDENDI

YES. UNDER SCTION 19 (1) OF BP 180 AS
AMENDED BY RA 7691
The RTC have sole, exclusive, original jurisdiction
to hear, try and decide all civil actions in which
the subject of litigation is incapable of pecuniary
estimation. In Singsong v. Isabela Sawmill, this
Court laid the test for determining whether the
subject matter of an action is incapable of
pecuniary estimation:
1. Ascertain the nature of the principal action
or remedy sought
2. If the action is primarily for recovery of a
sum of money, the claim is considered
capable of pecuniary estimation. Whether
the trial court has jurisdiction would
depend upon the amount of the claim
3. However, there the basic issue is
something other than the right to recover a
sum of money, where the money claim is
only incidental or a consequence of the
principal relief sought, the action is
incapable of pecuniary estimation
Here, the primary reliefs prayed for is the
cancellation of the mortgages for want of
consideration. Jurisprudence provides that where
the issue involves the validity of the mortgage, the
action is one incapable of pecuniary estimation.
NO.
There is grave abuse of discretion where the acts
complained of amount to an evasion of positive
duty or a virtual refusal to perform a duty enjoined
by law, or to act at all in contemplation of law, as
where the power is exercised in an arbitrary and
despotic manner by reasons of passion personal
hostility. It is such whimsical and capricious
exercise of judgment as is equivalent to lack of
jurisdiction.




ARRIOLA V. ARRIOLA

FACTS: John Arriola (respondent) filed a case with the
RTC for judicial partition of the properties of decedent
Fidel Arriola against herein petitioners Vilma and
Ronald Arriola. John is a son of the decedent with the
1
st
wife; Vilma is the 2nd wife, Ronald her kid with the
deceased.
The RTC rendered a decision ordering partition
of the subject lot into 1/3 share to each party. This
decision became final in March 4, 2004. However,
since the parties failed to agree on how to partition the
lot, John sought its sale through public auction, which
the court ordered. After the date for the public auction
had been scheduled, it had to be reset because the
petitioners Vilma and Roland refused to include in the
auction sale the house standing on the land. Thus,
John filed with the RTC an Urgent Manifestation and
Motion for Contempt of Court praying that petitioners
be held in contempt.
RTC denied the motion, ruling that the non-
inclusion of the house was justified since the decision
of the court earlier shows that nothing was mentioned
about the house. Even Johns initiatory complaint
never mentioned the house. The court said it could not
grant a relief not alleged and prayed for in the
complaint. MR with the RTC also denied.
In a petition for certiorari with CA, the court
granted the petition, reversing and setting aside the
RTC ruling. It ordered the sale of the lot, including the
house standing thereon. Petitioners filed MR with CA,
but it was denied, hence the present case.

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Issue: Did the lower court err in taking jurisdiction
over the contempt proceeding? Yes, it was wrong for
it to do so for failure to comply with reqts

Ruling: The contempt proceeding initiated by the John
Arriola is one for indirect contempt. Under Rule 71, it is
to be initiated by the court motu propio or by a
verified petition, with supporting particulars and
certified true copies of docs/papers involved and with
full compliance with the reqts for filing initiatory
pleadings for civil actions. The law is clear. The filing of
a verified petition that has complied with the reqts for
the filing of initiatory pleading is mandatory and for
failure to do so, the court should dismiss it outright.
Here, John Arriola merely filed an Urgent
Manifestation and Motion for Contempt. It was not
verified, and it failed to conform with the reqts for
initiatory pleadings such as submission of certification
against non-forum shopping and payment of docket
fees. The RTC clearly erred in taking jurisdiction over
the contempt proceeding. Even if the contempt
proceedings stemmed from the main case over which
the court already acquired jurisdiction, the rules direct
that the petition for contempt be treated independently
of the principal action. Consequently, the necessary
prerequisites for the filing of initiatory pleadings, such
as the filing of a verified petition, attachment of a
certification on non-forum shopping, and the payment
of the necessary docket fees, must still be faithfully
observed. (Before, it was actually allowed that
contempt proceedings be initiated by mere motion and
without compliance with the reqts for initiatory
pleadings, but since the 1997 Revised Rules of Civil
Procedure, such practice was no longer countenanced).
[Substantive part: even if the motion complied with
the reqts of the Rules of Court, it should still fail on
substantive grounds since it turned out that the house
is a family home and despite the death of one or both
spouses, it shall continue for a period of 10y or for as
long as there is a minor beneficiary, and the heirs
cannot partition it unless there is a compelling reason.
No such reason here.]
CA ruling is modified. The house is declared
part of the lot, but it is exempted from partition by
public auction until the period provided for in the law.


SPOUSES VILLACASTIN V. PELAEZ

Facts: Respondent Paul Pelaez and his wife mortgaged
their agricultural lands in Cebu to DBP. The spouses
failed to pay their mortgage obligation, so their
properties were foreclosed and subsequently sold at
public auction.
Said property had tenants who filed an action
to annul the mortgage, foreclosure and sale of
properties, claiming they were the owners. Said case
was filed before the Provincial Agrarian Reform
Adjudicator.
Petitioners Sps. Villacastin filed a complaint for
forcible entry with the MCTC against respondent Pelaez
and a certain Elesio Monteseven. It alleged that they
were the owners of the property, and that respondent
Pelaez entered the property thru stealth and strategy
and unlawfully deprived the spouses of possession
thereof. MCTC ruled in favour of the spouses. RTC
affirmed.
Meanwhile, the Provincial Agrarian Reform
Adjudicator in Cebu rendered a decision in favor of the
tenants.
The Court of Appeals, however, ruled that
regular courts should respect the primary jurisdiction
vested upon the DARAB in cases involving agricultural
lands such as the property subject of this case.
Accordingly, it set aside the decision rendered by the
RTC and the MCTC, and dismissed the complaint for
forcible entry filed by petitioners in this case.
Petitioner spouses contend that the case did
not involve any agrarian matter and thus, the MCTC
correctly exercised jurisdiction over the case.

Issue: Which court has jurisdiction over the case?
MCTC/REGULAR COURTS HAS JURISDICTION.

Held: Jurisdiction over the subject matter is
determined by the allegations of the complaint.

In
ascertaining, for instance, whether an action is one for
forcible entry falling within the exclusive jurisdiction of
the inferior courts, the averments of the complaint and
the character of the relief sought are to be examined.
A review of the complaint reveals that the
pertinent allegations thereof sufficiently vest
jurisdiction over the action on the MCTC.
1

No landowner-tenant vinculum juris or juridical
tie was alleged between petitioners and respondent, let
alone that which would characterize the relationship as
an agrarian dispute.


Petitioners' action is clearly for the recovery of
physical or material possession of the subject property
only, a question which both the MCTC and the RTC
ruled petitioners are entitled to. It does not involve the
adjudication of an agrarian reform matter, nor an
agrarian dispute falling within the jurisdiction of the
DARAB.
Courts have jurisdiction over possessory
actions involving public or private agricultural lands to
determine the issue of physical possession as this
issue is independent of the question of disposition and
alienation of such lands which should be threshed out

1
The allegations were:
That the plaintiffs are the owners and legal as well as actual
possessors of a parcel of agricultural land more particularly
described as follows; That the defendant, sometime in the
second week of March 1988, by strategy and through stealth
entered the above-described land of the plaintiffs and took
possession thereof; thus, depriving said plaintiffs of the
possession thereof; That several demands were made the
plaintiffs upon the defendants to restore to them the
possession of the above-described parcel of land; but,
defendants refused and still refuse to restore possession of
said property to the plaintiffs.
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in the DAR.

Thus, jurisdiction was rightfully exercised
by the MCTC and the RTC.


VARGAS V. CAMINAS

Facts: Jesus Garcia, as a developer of Trans-American
Sales and Exposition, sold a townhouse to the Caminas
spouses. However, Garcia also sold the same
townhouse to the Vargas spouses as payment for
various construction materials. Furthermore, Garcia
also mortgaged the same townhouse in favour of the
De Guzman spouses as security for a loan.
The Caminas spouses filed a complaint for the
declaration of nullity of the mortgage (to the De
Guzmans) and deed of sale (to the Vargases). Vargas
also filed a complaint for specific performance.
The Vargas spouses raised the lack of
jurisdiction of the trial court on the ground that the
subject matter falls within the exclusive jurisdiction of
the HLURB. The De Guzmans argue that the HLURB
has no jurisdiction over cases involving the declaration
of nullity of a mortgage contract filed against the
mortgagee. The Caminas argue that the Vargas
spouses are estopped from raising the issue of
jurisdiction of the trial court.
The RTC and CA decided in favour of the
Caminas spouses.
The case obviously falls under the
jurisdiction of the HLURB based on PD 957.

Issue: The case obviously falls under the jurisdiction
of the HLURB based on PD 957, but are the Vargas
spouses estopped from raising the defense of lack of
jurisdiction of the RTC? NO.

Ruling: The rule is that jurisdiction of a court may be
questioned at any stage of the proceedings. In this
case, Vargas raised the issue of lack of jurisdiction
during the Rejoinder. The trial court failed to address
the issue of jurisdiction in its decision. Clearly, the trial
court erred in not dismissing the case before it. Under
the Rules of Court, it is the duty of the court to dismiss
an action whenever it appears that the court has no
jurisdiction over the subject matter.
The equitable defense of estoppel requires
knowledge or consciousness of the facts upon which it
is based. The same thing is true with estoppel by
conduct which may be asserted only when it is shown,
among others, that the representation must have been
made with knowledge of the facts and that the party to
whom it was made is ignorant of the truth of the
matter.
Lozon v. NLRC came up with a clear rule on
whether jurisdiction by estoppel applies or does not. It
stated that: The operation of the principle of estoppel
on the question of jurisdiction seemingly depends upon
whether the lower court actually had jurisdiction or
not. If it had no jurisdiction, but the case was tried and
decided upon the theory that it had jurisdiction, the
parties are not barred, on appeal, from assailing such
jurisdiction, for the same `must exist as a matter of
law, and may not be conferred by consent of the
parties or by estoppel'.
However, if the lower court had jurisdiction,
and the case was heard and decided upon a given
theory, such, for instance, as that the court had no
jurisdiction, the party who induced it to adopt such
theory will not be permitted, on appeal, to assume an
inconsistent position that the lower court had
jurisdiction. Here, the principle of estoppel applies. The
rule that jurisdiction is conferred by law, and does not
depend upon the will of the parties, has no bearing
thereon. (In this case, the trial court clearly had no
jurisdiction over the subject matter. Hence, estoppel
does not apply.)
The CA, however, stated that the Vargas
spouses are estopped based on the Tijam doctrine
wherein the lack of jurisdiction was raised for the first
time in a motion to dismiss filed almost fifteen (15)
years after the questioned ruling had been rendered.
THEY ARE MISTAKEN! Tijam is an exception to the
general rule because of the presence of laches. (In this
case, Vargas raised the issue of jurisdiction before the
trial court rendered its decision. They continued to
raise the issue in their appeal before the Court of
Appeals and this Court. Hence, it cannot be said that
laches has set in.)


FIGUEROA VS. PEOPLE

Facts: An information for reckless imprudence
resulting in homicide was filed against Figueroa before
the RTC where he was convicted. He appealed the
conviction raising, among others, the issue of
jurisdiction. He argued for the first time on appeal,
that the RTC had no jurisdiction. The appellate court
denied his appeal ruling that he was already estopped
by laches because he had actively participated in the
trial and because of his belated assertion of the lack of
jurisdiction of the RTC.

Issue: When is a litigant estopped by laches from
assailing the jurisdiction of a court?

Held/Ratio:
Jurisdiction conferred by law in force at time of
institution of action
The rule is that jurisdiction is conferred by law.
And the law that should apply is that in force during
the institution of the action. At the time the
information in this case was filed, BP129 (Judiciary
Reorganization Act of 1980) had already been
amended by RA7691, which amended BP129 insofar as
it expanded the jurisdiction of the MTCs (RA7691 took
effect on April 15, 1994). Sec. 32 (2) of RA7691
provides that MTCs shall have exclusive original
jurisdiction over all offenses punishable by
imprisonment not exceeding 6 years, regardless of the
fine and other accessory penalties.
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In this case, the imposable penalty for the
crime charged was PC med and max (specifically 2yrs,
4mos, and 1 day to 6 yrs). So clearly, the MTCs had
jurisdiction. While the SolGen as well as the appellate
court agreed that the MTCs had jurisdiction, they
argued that estoppel by laches still applied. The trial
went on for 4yrs w/o the Figueroa raising the issue of
jurisdiction.

Jurisdiction vis-a-vis estoppels by laches
To resolve the issue, the SC analyzed several
different cases (ang dami so ito lang yung mga sinama
ko).
US v De la Santa Jurisdiction is subject to
objection at any stage, either in the court
below or on appeal.
Tijam v Sibonghanoy A party who actively
participated in the trial may be barred by
laches if he belatedly raises the issue of
jurisdiction.

General Rule
Lack of jurisdiction may be raised at any stage,
even on appeal. (Rationale is because jurisdiction is
conferred by law, and lack of it affects the very
authority of the court to take cognizance of the case)

Exception
Tijam v Sibonghanoy BUT this is an
exceptional case because here the lack of jurisdiction
was invoked only after 15yrs, and when the case was
already with the CA. Estoppel by laches may be
invoked to bar the issue of lack of jurisdiction only in
cases in which the factual milieu is analogous to that in
Tijam. Laches should be clearly present; that is, lack of
jurisdiction must have been raised so belatedly as to
warrant the presumption that the party entitled to
assert it had abandoned or declined to assert it.

Some healthy reminders from your friendly SC
Estoppel, being in the nature of a forfeiture, is
not favored by law. It is to be applied rarelyonly
from necessity, and only in extraordinary
circumstances. The doctrine must be applied with great
care and the equity must be strong in its favor.
Jurisdiction over the nature and subject matter
of an action is conferred by the Constitution and the
law, and not by the consent or waiver of the parties
where the court otherwise would have no jurisdiction
over the nature or subject matter of the action. Nor
can it be acquired through, or waived by, any act or
omission of the parties. Moreover, estoppel does not
apply to confer jurisdiction to a tribunal that has none
over the cause of action.


DE BARRERA v LEGASPI

FACTS: This is a land dispute between De Barrera and
Legaspi who is the present possessor of a parcel of
land in Misamis Occidental. Legaspi was evicted by
peace officers from the land on the pretense that the
property was owned by De Barrera as evidenced by an
OCT. Legaspi filed an action for recovery of possession
with preliminary mandatory injunction and damages
with the RTC.
De Barrera interposed the affirmative defense
of ownership and likewise assailed the jurisdiction of
the court on the ground that the assessed value of the
land was only 11,160 as evidenced by the tax
declaration.
RTC sustained its jurisdiction claiming that
what determines jurisdiction are the allegations in the
complaint and not those in the answer. Since the
complaint alleges that the land was worth 50,000, it is
within the jurisdiction of the RTC.
CA sustained.

ISSUE: Whether or not the RTC has jurisdiction
NONE

HELD: According to BP 129, accion publiciana and/or
accion reivindicatioria is within the exclusive
jurisdiction of the MTC if the assessed value of the land
does not exceed 20,000 outside Metro Manila and
50,000 within Metro Manila. Thus the action is within
the jurisdiction of the MTC it appearing that the
assessed value of the land was only 11,160.
Assessed value is defined as the worth of the
land as determined by the tax authorities against
which the tax rate is applied. It is not similar to fair
market value. Thus, it was an error for the court to
base its jurisdiction to the uncorroborated allegation of
Legaspi that the land was worth 50,000


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RULE 2: CAUSE OF ACTION

Mindanao Terminal v Phoenix Assurance
Company & McGee

Facts: Del Monte Philippines contracted Mindanao
Terminal, a stevedoring company, to load and stow
bananas and pineapples owned by Del Monte Produce
(note: not by Del Monte Philippines) into the cargo
hold of a vessel. Del Monte Produce insured the
shipment of fruits under an open cargo policy with
Phoenix (insurer) and McGee & Co (underwriting
manager/agent of Phoenix).
The cargo was damaged so Del Monte Produce
filed a claim against Phoenix and McGee. Phoenix and
McGee paid del Monte Produce and was issued a
subrogation receipt. So Phoenix and McGee filed an
action for damages against Mindanao Terminal in the
RTC of Davao.
The RTC ruled against Phoenix and McGee
stating, among others, that they did not have a cause
of action against Mindanao because Mindanao was
contracted by Del Monte Philippines, and not with the
insured Del Monte Produce.
On appeal, the CA reversed, stating that there
was a cause of action based on Article 2176 (Quasi-
delict).

Issue: Do Phoenix and McGee have a cause of action
against Mindanao Terminal?

Held: Yes, there was a cause of action.
The present action is based on quasi-delict, arising
from the negligent and careless loading and stowing of
the cargoes belonging to Del Monte Produce. Even
assuming that both Phoenix and McGee have only been
subrogated in the rights of Del Monte Produce, who is
not a party to the contract of service between
Mindanao Terminal and Del Monte, still the insurance
carriers may have a cause of action in light of the
Courts consistent ruling that the act that breaks the
contract may be also a tort. In fine, a liability for tort
may arise even under a contract, where tort is that
which breaches the contract.
In the present case, Phoenix and McGee are
not suing for damages for injuries arising from the
breach of the contract of service but from the alleged
negligent manner by which Mindanao Terminal handled
the cargoes belonging to Del Monte Produce. Despite
the absence of contractual relationship between Del
Monte Produce and Mindanao Terminal, the allegation
of negligence on the part of the defendant should be
sufficient to establish a cause of action arising from
quasi-delict.


TURNER V LORENZO SHIPPING

Facts: Sps. Philip and Elnora Turner held 1.10 million
shares of stock of Lorenzo Shipping Corporation (LSC),
a domestic corporation engaged in cargo shipping. LSC
decided to amend its articles of incorporation to
remove the stockholders' pre-emptive rights to newly
issued shares of stock. As it is prejudicial to their
interest as stockholders, Sps. Turner voted against the
amendment and demanded payment of their shares
(at the rate of P2.3/share based on the book value of
the shares, totaling P2.3M). LSC disagreed on the
amount, but an appraisal committee settled the matter
and set the valuation at P2.5M in total. Sps. Turner
then demanded payment based on this amount, but
LSC still refused to pay. LSC argued that, according to
the Corporation Code, payment can be made only if a
corporation has unrestricted retained earnings
(earnings that can be distributed as dividends) in its
books to cover the value of the shares.
1
In January 22,
2001, upon LSCs refusal to pay, the Turners filed a
complaint for collection and damages. RTC ruled in
their favor and ordered LSC to pay after it was proven
that LSC actually had retained earnings amounting to
P12M in March 21, 2002. CA, however, reversed the
RTC and dismissed the case, stating that the cause of
action had not yet accrued due to the lack of
unrestricted retained earnings in the books of LSC.

Issues: Did RTC Judge Tipon exceed his jurisdiction in
entertaining the complaint and issuing writs of
garnishment against LSC? - Yes. Did the spouses have
a cause of action? No. When is the proper time to
determine cause of action in this case? At the time
the demand of payment is made (2001).

Ruling: Subject to certain qualifications, and except as
otherwise provided by law, an action commenced
before the cause of action has accrued is prematurely
brought and should be dismissed. It does not matter if
the cause of action accrues after the action is
commenced and while it is pending. It is settled rule
that to recover at all, there must be some cause of
action at the commencement of the suit.
Before an action can properly be commenced,
all the essential elements of the cause of action must
be in existence, that is, the cause of action must be
complete. All valid conditions precedent to the
institution of the particular action, whether prescribed
by statute, fixed by agreement of the parties or
implied by law must first be performed or complied
with, unless the conduct of the adverse party has been
such as to prevent or waive performance or excuse
non-performance of the condition. In this case, the
condition precedent for a cause of action is the
existence of unrestricted retained earnings in the
books of LSC. Without it, the action is premature.


1
Pursuant to the Corporation Code, the dissenting
stockholders exercising their appraisal rights is subject to the
legal condition that no payment shall be made to any
dissenting stockholder unless the corporation has unrestricted
retained earnings in its books to cover such payment. The
purpose of this is to ensure that the corporate assets cannot
be distributed among the stockholders without first paying the
creditors, based on the trust fund doctrine.
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An action prematurely brought is a groundless
suit. Unless the plaintiff has a valid and
subsisting cause of action at the time his action
is commenced, the defect cannot be cured or
remedied by the acquisition or accrual of one
while the action is pending, and a supplemental
complaint or an amendment setting up such after-
accrued cause of action is not permissible.
The evidence here shows that in its quarterly
financial statement submitted to the SEC, LSC indeed
has retained earnings of P12M as of 2002. However,
this fact is neither material nor disputed. The valid
argument against paying is that there must be
unrestricted retained earnings at the time the demand
for payment is made (i.e. filing of the suit in 2001). At
the time of Sps. Turners demand, LSC had no retained
earnings yet and in fact even had a deficit of P73M.
This is borne out by LSCs Financial Statements for
Fiscal Year 1999. Thus, any retained earnings made in
2002a year after the case was filedis irrelevant to
the Sps. Turner's right to recover. Well-settled rule is if
no right existed at the time the action was
commenced, the suit cannot be maintained, although
such right of action may have accrued thereafter.


CHUA AND FILDEN CO. VS. METROBANK AND
TRUST CO. AND ATTY. CELESTRA

FACTS: Petitioner Chua, president of Filiden (a
domestic corporation), obtained a loan from Metrobank
which was secured by a REM on parcels of land he
owned. Upon maturity, Metrobank demanded that
Filden and Chua fully pay and settle their accounts, but
the latter failed to do so. Thus, Metrobank extra-
judicially foreclosed the REMs constituted on the
subject properties.
Upon a verified Petition for Foreclosure filed by
Metrobank, Atty. Celestra issued a Notice of Sale. Chua
filed a Complaint for Injunction with Prayer for
Issuance of TRO, Preliminary Injunction and
Damages
2
(first case) against Atty. Celestra. After
the expiration of the TRO, Atty. Celestra reset the
schedule of the auction sale on Nov. 8, 2001.
However, on the day of the auction sale (Nov 8), the
RTC issued an Order directing that the said sale be
reset anew AFTER Nov. 8, 2001. Said Order was not
received by Atty. Celestra on time, thus, the auction
sale proceeded on Nov. 8, 2001 and a Certificate of
Sale was issued to Metrobank as the highest bidder.
Petitioners (Chua and Filiden) filed with the
RTC a Motion to Admit Amended Complaint in Civil
Case No. CV-01-0207. The amended complaint
basically questioned the validity of the auction sale.
The RTC ruled in favor of Metrobank, saying that the
auction sale was valid and denied Petitioners
application for injunction. Upon appeal, the CA
reversed the RTC decision and remanded the case for
further proceedings. Then, petitioners (Chua and

2
Civil Case No. CV-01-0207 First case
Filiden) filed a Complaint for Damages
3
(second
case) against Metrobank and Atty. Celestra. A Motion
to Consolidate the action for damages and injunction
case was then filed by the Petitioners. Metrobank
opposed the Consolidation on the ground of forum
shopping. The RTC ruled in favor of Metrobank. The CA
affirmed the RTC decision.

ISSUE: W/N the successive filing of the first
(injunction) and second (action for damages)
cases amounted to forum shopping.

HELD/RATIO: YES.

Forum shopping can be committed in three ways: (1)
filing multiple cases based on the same cause of action
and with the same prayer, the previous case not
having been resolved yet (where the ground for
dismissal is litis pendentia); (2) filing multiple cases
based on the same cause of action and the same
prayer, the previous case having been finally resolved
(where the ground for dismissal is res judicata); and
(3) filing multiple cases based on the same cause of
action, but with different prayers (splitting of causes of
action, where the ground for dismissal is also either
litis pendentia or res judicata).
In this case, petitioners committed forum
shopping by filing multiple cases based on the same
cause of action, although with different prayers. Forum
shopping occurs although the actions seem to be
different, when it can be seen that there is a splitting
of a cause of action. A cause of action is understood
to be the delict or wrongful act or omission
committed by the defendant in violation of the
primary rights of the plaintiff. It is true that a
single act or omission can violate various rights at the
same time, as when the act constitutes juridically a
violation of several separate and distinct legal
obligations. However, where there is only one delict or
wrong, there is but a single cause of action regardless
of the number of rights that may have been violated
belonging to one person.
Petitioners would like to make it appear that
the injunction case was solely concerned with the
nullification of the auction sale and certification of sale,
while the action for damages was a totally separate
claim for damages. Yet, a review of the records reveals
that petitioners also included an explicit claim for
damages in their Amended Complaint in the injunction
case. Also, there is no question that the claims of
petitioners for damages in both cases are premised on
the same cause of action, i.e., the alleged wrongful
conduct of respondents in connection with the
foreclosure sale of the properties.


PANTRANCO NORTH EXPRESS and BUNCAN vs.
STANDARD INSURANCE and GICALE


3
Civil Case No. CV-05-0402 Second case
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FACTS: The jeepney owned by Gicale was hit by a
Pantranco bus driven by Buncan. It was raining. Both
vehicles were travelling north bound. The hit happened
when, while negotiating a curve along the highway, the
Pantranco bus overtook the jeepney. The bus hit the
left rear side of the jeepney and sped away.
The total cost of the repair wasP21,415.00. Standard
Insurance (insurer of Pantranco) paid only 8K. Gicale
(owner of the jeepney) shouldered the balance
of P13,415.00.
Standard Insurance and Gicale demanded
reimbursement from Pantranco and its driver Buncan,
but they refused. This prompted Standard and Gicale
to file with the RTC a complaint for sum of money.
In their answer, Pantranco and Buncan averred
that it is the MTC, not the RTC, which has jurisdiction.
Gicales claim of P13,415.00 and Standard Insurances
claim of P8,000.00 individually fell under the exclusive
original jurisdiction of the MTC. They also claimed that
there was a misjoinder of parties because the cause of
action of Standard Insurance and Gicale did not arise
from the same transaction and that there are no
common questions of law and fact common to both
parties.

ISSUE: WON RTC has jurisdiction over the subject of
the action -- YES

RATIO: There is a single transaction common to all--
Pantrancos bus hitting the rear side of the jeepney.
There is also a common question of fact-- whether
Pantranco and its driver are negligent. There being a
single transaction common to Standard Insurance and
Gicale, consequently, they have the same cause of
action against petitioners.
To determine identity of cause of action, it
must be ascertained whether the same evidence
which is necessary to sustain the second cause of
action would have been sufficient to authorize a
recovery in the first. Here, had Standard Insurance
and Gicale filed separate suits against Pantranco and
its driver Buncan, the same evidence would have been
presented to sustain the same cause of action. Thus,
the filing by both respondents of the complaint with
the court below is in order. Such joinder of parties
avoids multiplicity of suit and ensures the convenient,
speedy and orderly administration of justice.
Section 5(d), Rule 2 provides:
Sec. 5. Joinder of causes of action. A party may in
one pleading assert, in the alternative or otherwise, as
many causes of action as he may have against an
opposing party, subject to the following conditions:
x x x
(d) Where the claims in all the causes of action are
principally for recovery of money the aggregate
amount claimed shall be the test of jurisdiction.
The above provision presupposes that the different
causes of action which are joined accrue in favor of the
same plaintiff/s and against the same defendant/s and
that no misjoinder of parties is involved. The issue of
whether respondents claims shall be lumped together
is determined by paragraph (d) of the above
provision. This paragraph embodies the totality rule
as exemplified by Section 33 (1) of B.P. Blg. 129 which
states that where there are several claims or causes
of action between the same or different parties,
embodied in the same complaint, the amount of the
demand shall be the totality of the claims in all the
causes of action, irrespective of whether the causes of
action arose out of the same or different transactions.
B.P. Blg. 129 provides that the RTC has exclusive
original jurisdiction if the claim, exclusive of interest
and cost, amounts to more than P20,000.00.


SPS. VICTOR & MILAGROS PEREZ and CRISTINA
AGRAVIADOR AVISO v. ANTONIO HERMANO

FACTS: On April 1998, petitioners sps. Perez and
Aviso filed a civil case for Enforcement of Contract and
Damages, with a prayer for issuance of a TRO and/or
Preliminary Injunction against Zescon Land, Inc., its
president Sales-Contreras, a certain Atty. Vitan-Ele
AND respondent in this case, Antonio Hermano. (So
there were supposedly 4 defendants.)
Subsequently, Hermano filed his Answer with
Compulsory Counterclaim. Also, almost 2 years after
he filed his answer, he filed a Motion with Leave to
Dismiss the Complaint or Ordered Severed for
Separate Trial. This latter motion was granted by
RTC QC, in effect dismissing the case with respect to
Hermano. So petitioners Perez and Aviso filed a
petition for certiorari (R65) which was however
dismissed by the CA for having been filed out of time,
as well as the MR.
It all started with petitioners Perez and Aviso
filing a case against Zescon Land, Inc. and its officers
for enforcement of the contract, plus damages, plus
TRO/PI. The petitioners invoke 3 causes of action:
1. Enforcement of the contract to sell entered
between petitioners and Zescon Land, Inc.
2. Annulment or rescission of 2 contracts of
mortgage between petitioners and Hermano
3. Damages against all the defendants.
Petitioners allege that they purchased 5 parcels of
land from Zescon Land, valued at P19.104M. The
petitioners assert that through the tricky machination
and simultaneous execution of the Contract to Sell,
they were also made to sign other documents, such as
2 mortgage deeds in favor of respondent Hermano,
whom they hadnt even met. Petitioners contend that
they never intended to mortgage their property to
Hermano.
Hermano later on paid filed a case for judicial
foreclosure of the mortgages. The petitioners Perez
and Aviso seek a TRO to prevent Hermano from
foreclosing the properties.
Hermano, on the other hand, contends that
there was a MISJOINDER of parties because
defendants were under different transactions or causes
of action. He already filed a separate action against
petitioners Perez and Aviso for judicial foreclosure of
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the parcels of land, in another court while this action is
evidently different from the enforcement of the
contract case. So that was when the trial court allowed
for the dismissal of the case against Hermano.
The petitioners are asserting that RTC acted
with GADLEJ in dismissing the complaint as against
Hermano because Hermano didnt even file a motion to
dismiss under Rule 16 (bec what he filed was motion
with leave to dismiss or ordered severed for separate
trial). Also, the petitioners say that there was no
misjoinder of causes of action not was there misjoinder
of parties.

ISSUE: W/N the enforcement of contract case
was validly dismissed with respect to Hermano.

HELD/RATIO: NO! There is no misjoinder,
Hermano should be included as defendant in the
case.
The trial court dropped Hermano from the
complaint on ground of misjoinder of causes of action.
The SC however, disagrees. There is no misjoinder of
causes of action, nor of parties.
Joinder of causes of action, is meant the
uniting of two or more demands or rights of action in
one action; the statement of more than one cause of
action in a declaration. It is the union of two or more
civil causes of action, each of which could be made the
basis of a separate suit, in the same complaint,
declaration or petition. A plaintiff may under certain
circumstances join several distinct demands,
controversies or rights of action in one declaration,
complaint or petition.
The joinder of separate causes of action, where
allowable, is permissive and not mandatory in the
absence of a contrary statutory provision, even though
the causes of action arose from the same factual
setting and might under applicable joinder rules be
joined. Modern statutes and rules governing joinders
are intended to avoid a multiplicity of suits and to
promote the efficient administration of justice
wherever this may be done without prejudice to the
rights of the litigants.
While joinder of causes of action is largely left
to the option of a party litigant (petitioner), Section 5,
Rule 2 of our present Rules allows causes of action to
be joined in one complaint conditioned upon the
following requisites: (a) it will not violate the rules on
jurisdiction, venue and joinder of parties; and (b) the
causes of action arise out of the same contract,
transaction or relation between the parties, or are for
demands for money or are of the same nature and
character.
There is misjoinder of causes of action when
the conditions for joinder under Section 5, Rule 2
4
are
not met. Section 5 provides:

4
Sec. 5. Joinder of causes of action. - A party may in one
pleading assert, in the alternative or otherwise, as many
causes of action as he may have against an opposing party,
subject to the following conditions:
It is well to remember that the joinder of
causes of action may involve the same parties or
different parties. If the joinder involves different
parties, as in this case, there must be a question
of fact or of law common to both parties joined,
arising out of the same transaction or series of
transaction.
In this case, petitioners have adequately
alleged in their complaint that after they had already
agreed to enter into a contract to sell with Zescon
Land, Inc., through Sales-Contreras, the latter also
gave them other documents to sign, including two
mortgage deeds over the same properties in favor of
respondent Hermano. Petitioners claim that Zescon
Land, Inc. misled them to mortgage their properties
which they had already agreed to sell to the latter.
From the above averments in the complaint, it
becomes reasonably apparent that there are questions
of fact and law common to both Zescon Land, Inc., and
respondent Hermano arising from a series of
transaction over the same properties. There is the
question of fact, for example, of whether or not Zescon
Land, Inc., indeed misled petitioners to sign the
mortgage deeds in favor of respondent Hermano.
There is also the question of which of the four
contracts were validly entered into by the parties.

RULE 3: PARTIES

NAGKAKAISANG LAKAS NG MANGGAGAWA SA
KEIHIN V. KEIHIN PHILIPPINES CORP.

Facts:
Keihin Corp (respondent) is engaged in the
production of intake manifold and throttle body
used in motor vehicles manufactured by
Honda. As part of its standard operating
procedure, Keihin subjects all its employees to
reasonable search before the leave the
company premises.
On Sept. 5, 2003, Helen Valenzuela
(petitioner) was caught with packing tape
inside her bag. Disciplinary action was
instituted against Helen wherein she admitted
the offense and manifested that she would
accept whatever penalty would be imposed
upon her.
Keihin Corp terminated Helens services on the
ground that Helen was guilty of serious

(a) The party joining the causes of action shall comply with
the rules on joinder of parties;
(b) The joinder shall not include special civil actions or actions
governed by special rules;
(c) Where the causes of action are between the same parties
but pertain to different venues or jurisdictions, the joinder
may be allowed in the Regional Trial Court provided one of
the causes of action falls within the jurisdiction of said court
and the venue lies therein; and
(d) Where the claims in all the causes of action are principally
for recovery of money, the aggregate amount claimed shall
be the test of jurisdiction.
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misconduct because there was a deliberate act
of stalling from the company.
Helen and Petitioner Nagkakaisang Lakas ng
Manggagawa sa Keihin filed a complaint for
illegal dismissal against Keihin Corp alleging
that Helens act of taking the packing tape did
not constitute serious misconduct. Thus, even
if Helen admitted to taking the packing tape,
the punishment was disproportionate to her
infraction.
Labor Arbiter dismissed the complaint. NLRC
dismissed the appeal.
Court of Appeals dismissed the petition for
certiorari filed by Nagkakaisang Lakas ng
Mangagawa sa Keihin for not having been filed
by an indispensable party in interest.

Issue: Whether CA committed error in dismissing the
petition on the ground that it was not filed by an
indispensable party?

Held: No, CA affirmed but SC continued to discuss the
merits of the appeal because dismissal on purely
technical grounds is frowned upon.
It is clear that petitioners failed to include the
name of Helen Valenzuela in the caption of
their petition for certiorari filed with the CA as
well as in the body of the said petition.
Instead, they only indicated the name of the
labor union Nagkakaisang Lakas ng
Manggagawa sa Keihin (NLMK-OLALIA) as the
party acting on behalf of Helen. As a result, the
CA rightly dismissed the petition based on a
formal defect.
Under Section 7, Rule 3 of the Rules of Court,
"parties in interest without whom no final
determination can be had of an action shall be
joined as plaintiffs or defendants."
If there is a failure to implead an indispensable
party, any judgment rendered would have no
effectiveness. It is precisely when an
indispensable party is not before the court
(that) an action should be dismissed. The
absence of an indispensable party renders all
subsequent actions of the court null and void
for want of authority to act, not only as to the
absent parties but even to those present.
The purpose of the rules on joinder of
indispensable parties is a complete
determination of all issues not only between
the parties themselves, but also as regards
other persons who may be affected by the
judgment. A decision valid on its face cannot
attain real finality where there is want of
indispensable parties.


REPUBLIC v. COALBRINE INTERNATIONAL PHILS,
INC. and SHEILA F. NERI

FACTS:
EPZA- Export Processing Zone Authority
(predecessor)
PEZA Philippine Economic Zone Authority
(successor)
EPZA and Coalbrine entered into a contract in
which Coalbrine would rehabilitate and lease the
Bataan Hilltop Hotel, Gold Course and Clubhouse
(owned by EPZA) for 25 years, renewable for another
25 years at the option of Coalbrine. Respondent NERI
was the Managing Director of the hotel. PEZA Board
later passes a resolution rescinding the contract to
rehabilitate and lease due to Coalbrines repeated
violations and non-performance of its obligations as
provided in the contract. PEZA sent Coalbrine a notice
to vacate the premises and to pay its outstanding
obligations to it.
Coalbrine filed with the RTC of Manila a
Complaint for specific performance with prayer for the
issuance of a TRO and/or writ of preliminary injunction
with damages against PEZA and/or Bataan Economic
Zone wherein respondent Coalbrine sought to declare
that PEZA had no valid cause to rescind the contract to
rehabilitate and lease and to enjoin PEZA from taking
over the hotel and country club and from disconnecting
the water and electric services to the hotel.
Respondents Coalbrine and Neri filed with the RTC of
Balanga, Bataan, a Complaint for damages with prayer
for the issuance of a TRO and/or writ of preliminary
prohibitory/mandatory injunction against Zone
Administrator Quindoza. Respondent alleged that
Quindoza started to harass the hotel's operations by
causing the excavation of the entire width of a cross-
section of the only road leading to the hotel for the
supposed project of putting up a one length steel pipe
and cutting the pipelines that supplied water to the
hotel.
Quindoza, through the SOLGEN, filed a motion
to dismiss on the ground, among others, that the
complaint is fatally defective for being unauthorized
(that Neri had no proof of authority to file the
complaint in the RTC of Balanga, Bataan). RTC denied.
Filed MR but denied. REPUBLIC, represented by
Quindoza in his capacity as Zone Administrator of the
Bataan Economic Zone, filed with the CA a petition for
certiorari under R65 seeking to annul the RTC orders.
CA denied.
Coalbrine and Neri argued that the Republic of
the Philippines was not a party to the civil case subject
of the petition, hence, it has no personality to file the
instant petition for review.
Republic claimed that respondent Neri's
signature in the verification and certification against
non-forum shopping attached to the complaint filed by
respondents in the RTC was defective, since there was
no proof of her authority to institute the complaint on
behalf of the corporation; and that respondent Neri is
not a real party-in-interest.

ISSUE:
1. Whether or not the Neri is a real party-in-
interest NO
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2. Whether or not complaint was fatally defective
for Neris lack of proof of authority to file the
complain YES
3. Whether or not Republic is a real party-in-
interest - YES

HELD: The acts complained of and said to have been
committed by petitioner against respondents have
solely affected the hotel's operations where respondent
Neri was the hotel's Managing Director and whose
interest in the suit was incidental. Thus, the Court
found that respondent Neri has no cause of action
against petitioner. Consequently, the plaintiff in this
case would only be respondent Coalbrine.
A corporation exercises said powers through its
board of directors and/or its duly authorized officers
and agents. Physical acts of the corporation, like the
signing of documents, can be performed only by
natural persons duly authorized for the purpose by
corporate by-laws or by a specific act of the board of
directors. In this case, respondent Coalbrine is a
corporation. However, when respondent Neri filed the
complaint in the RTC, there was no proof that she was
authorized to sign the verification and the certification
of non-forum shopping.
While the requirement regarding verification of
a pleading is merely formal and not jurisdictional, the
lack of certification of non-forum shopping is generally
not curable by mere amendment of the complaint, but
shall be a cause for the dismissal of the case without
prejudice. Failure to provide a certificate of non-forum
shopping is sufficient ground to dismiss the petition.
Likewise, the petition is subject to dismissal if a
certification was submitted unaccompanied by proof of
signatory's authority. The Court found no reason to
relax this rule since no subsequent compliance thereof
was ever made.
Finally, the Court held that Republic was a real
party-in-interest. Notably, Administrator Quindoza was
sued for damages for certain acts that he allegedly
committed while he was the Zone Administrator of the
Bataan Export Processing Zone. Therefore, the
complaint is in the nature of suit against the State, and
the Republic has the personality to file the petition.


REPUBLIC VS. AGUNOY

FACTS: Gregorio Agunoy filed his application for free
patent over Lots 1341 and 1342, an 18-ha. parcel of
land. This application was granted. The free patent led
to the issuance of OCT P-4522. Shortly after, the heirs
of Perez caused an annotation of an adverse claim in
their favor over 15.1 hectares of the land covered by
OCT P-4522. The heirs of Perez later filed a formal
protest. The investigation of the Bureau of Lands show
that the free patent in favor of Agunoy was indeed
fraudulently obtained. Despite the protest, numerous
transactions regarding the land were made on the
Agunoy side (subdivision of the lots, sales, mortgages)
causing the heirs of Perez to file a supplemental
protest. On investigation by the Bureau of Lands, it
was found that an OCT for the lot covered by the free
patent already existed at the time of the granting of
the free patent. These facts brought the Republic,
through the OSG, to file a case against several
defendants who are successors-in-interest of Agunoy.

ISSUE: W/N the Republic is a real party-in-interest

HELD: The Republic is not the real party-in-interest. To
qualify a person to be a real party-in-interest in whose
name an action must be prosecuted, he must appear
to be the present real owner of the right sought to be
enforced. A real party in interest is the party who
stands to be benefited or injured by the judgment in
the suit, or the party entitled to the avails of the suit.
And by real interest is meant a present substantial
interest, as distinguished from a mere expectancy or a
future, contingent, subordinate or consequential
interest.
As stated in the facts, the land sought to be
reconveyed in the Republic's suit belongs to a private
party by virtue of the OCT previously issued to such
party and is no longer a disposable public land at the
time of the fraudulent granting of free patent. Case
dismissed ruling against Republic.

RATIO: By the Republics admission in its pleadings,
the lands in question were already private property of
Perez/Espiritu, which means that the property in
question was no longer a disposable public land. As the
Bureau of Lands no longer had any jurisdiction and
control, the Republic cannot be considered real-party-
in-interest anymore.


CUA JR. VS TAN

FACTS: PRCI, a corporation
5
(for horse racing and
breeding) and a franchise holder
6
of opening one
racetrack, amended its Articles of Incorporation to
include a secondary purpose (acquire, develop or sell
real prop). PRCI owned two properties (Makati [Sta.
Ana racetrack] and Cavite) and wanted to convert one
of them (Makati) from a racetrack to urban residential
and commercial use since the property was severely
underutilized. PRCI decided to make a wholly owned
subsidiary instead of giving up the property. But
instead of creating a new corp, they just thought of
just buying another domestic corp (JTH). The purchase
of JTH by acquiring its shares of stock was approved
by the Board and also in a special stockholders
meeting. PRCI was able to acquire around 98% of
JTHs capital stock, and for the remaining capital stock,
PRCI transferred the Makati property to JTH in
exchange for the missing stocks and also serve as
capital for the subsidiary.

5
PRCI is listed in the PSE with authorized capital stock of P1B
divided into 1M shares
6
Via RA 7953
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When the transfer of property was presented
at the annual stockholders meeting, minority
stockholders (MIGUEL et al) filed derivative suits (with
application for TRO) against the directors of PRCI and
JTH, saying the transfer was fraudulent and prejudicial
to PRCI and that the Board resolutions leading to the
transfer was refused to be given to MIGUEL, violating
the rights of the minority stockholders to information
and to inspect corporate books and records. The TRO
was granted for holding of the annual stockholders
meeting.
SANTIAGO (Jr. and Sr.), as directors of PRCI,
filed a petition against the granting of the TRO, but
was dismissed. Subsequently, a permanent injunction
was issued over the same. SANTIAGOs contended that
MIGUELs case did not constitute a valid derivative
suit, since the latter failed to allege in their complaint
that they had no appraisal rights
7
for the acts they
were complaining of. MIGUEL explained that their
complaint was not merely a derivative suit but was
also an intra-corporate action against the fraudulent
schemes of PRCI directors. They also explained that
the appraisal rights were unavailable to them due to
the mismanagement of the directors.
Subsequently, another set of minority
stockholders (JALANE) filed a derivative suit against
PRCI directors, basically the same as MIGUELs
contentions.

ISSUE: W/N the derivative suits of the minority
stockholders (MIGUEL and JALANE) should prosper.
NO.

HELD: It is well settled in this jurisdiction that where
corporate directors are guilty of a breach of trust
not of mere error of judgment or abuse of discretion, a
stockholder may institute a derivative suit for the
benefit of the other stockholders and the corp. A
derivative suit is different from individual (wrong is
done personally) or class suits (wrong done to a
group), because wrong is done to corp itself in cases of
mismanagement by the directors.
The Court held that MIGUELs complaint only
amounted to a derivative suit because did not allege
injury either personal or a certain class of stockholders
to which they belong.
However, the derivative suit for the acquisition
of JTH should be dismissed for being moot. The PRCI
Board Resolution for the sale was approved and
ratified by stockholders holding 74% of capital stock
during the special stockholders meeting. By
ratification, even an unauthorized act of an agent
becomes the authorized act of the principal. Even if
this suit is not moot, it still dismissible for failure to
implead indispensable parties [Note: for indispensable
parties doctrine, see bold paragraph below], namely,

7
the right of shareholders who object to being acquired to
demand a fair price for their shares, as determined by a
court.
the majority of the PRCI stockholders, for they have
approved and ratified the Resolution.
The derivative suit for the property for shares
exchange is also dismissible for lack of cause of action.
A stockholders right to institute a derivative suit is not
based on any express provision of the Corporation
Code but is impliedly recognized. The basis of a
stockholders suit is always one of equity. However, it
cannot prosper without first complying with the legal
requisites for its institution. One of the requirements is
that appraisal rights are available. MIGUELs reasons
for not alleging appraisal rights are invalid.
MIGUELs derivative suit bars JALANEs. The
corporation is the real party in interest in a
derivative suit, and the suing stockholder is only
a nominal party. The corporation should be included
as a party in the suit. Not only is the corporation an
indispensable party, but it is also the present rule that
it must be served with process. With the corporation
as the real party-in-interest and the indispensable
party, any ruling in one of the derivative suits should
already bind the corporation as res judicata in the
other.
Under Rule 3, Section 7 of the Rules of
Court, an indispensable party is a party-in-
interest, without whom no final determination
can be had of an action without that party being
impleaded. Indispensable parties are those with
such an interest in the controversy that a final
decree would necessarily affect their rights, so
that the court cannot proceed without their
presence. Interest, within the meaning of this
rule, should be material, directly in issue, and to
be affected by the decree, as distinguished from
a mere incidental interest in the question
involved. On the other hand, a nominal or pro
forma party is one who is joined as a plaintiff or
defendant, not because such party has any real
interest in the subject matter or because any
relief is demanded, but merely because the
technical rules of pleadings require the presence
of such party on the record.
[

Allowing two different minority stockholders to
institute separate derivative suits arising from the
same factual background, alleging the same causes of
action, and praying for the same reliefs, is tantamount
to allowing the corporation, the real party-in-interest,
to file the same suit twice, resulting in the violation of
the rules against a multiplicity of suits and even
forum-shopping. It is also in disregard of the
separate-corporate-entity principle, because it is to
look beyond the corporation and to give recognition to
the different identities of the stockholders instituting
the derivative suits.

OTHER NOTES:
Santiagos petitions were not procedurally
infirm, although a bit defective. They were not
guilty of forum shopping as the identity of
interests was not the same (one was for
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individual capacities as PRCI directors and one
collectively as PRCI directors).
A derivative suit, on one hand, and individual
and class suits, on the other, are mutually
exclusive


BANDA v. ERMITA

Facts: Petitioners challenged the constitutionality of EO
378 issued by GMA, characterizing their action as a
class suit filed on their own behalf and on behalf of all
their co-employees at the National Printing Office
(NPO). The assailed EO removed the exclusive
jurisdiction of the NPO over the printing services
requirements of government agencies and
instrumentalities, making it now compete with the
private sector, except in the printing of election
paraphernalia. They perceive this EO to be a threat to
their security of tenure and contend that it is beyond
GMAs power to amend or repeal the law creating the
NPO, which Aquino issued pursuant to her legislative
power.

Issue: Whether the petition indeed qualifies as a class
suit - NO

Ratio: Courts must exercise utmost caution before
allowing a class suit, which is the exception to the
requirement of joinder of all indispensable parties. For
while no difficulty may arise if the decision is favorable
to the plaintiffs, a quandary would result if the decision
were otherwise as those who are deemed impleaded
by their self-appointed representative would certainly
claim denial of due process.
Sec. 12 of Rule 3 defines a class suit, the
requisites of which are: 1) the subject matter of
controversy is one of common or general interest to
many persons; 2) the parties affected are so numerous
that it is impracticable to bring them all to court; and
3) the parties bringing the class suit are sufficiently
numerous or representative of the class an can fully
protect the interests of all concerned.
An action does not become a class suit merely
because it is designated as such in the pleadings.
Whether the suit is or is not a class suit depends upon
the attending facts, and the complaint or other
pleading initiating the class action should allege the
existence of the necessary facts: 1) the existence of a
subject matter of common interest, and 2) the
existence of a class and the number of persons in the
alleged class, in order that the court might be able to
determine whether the members of the class are so
numerous as to make it impracticable to bring them all
before the court, to contrast the number appearing on
the record with the number in the class, and to
determine whether claimants adequately represent the
class and subject matter of general or common
interest.
In this case, the petition failed to state the
number of NPO employees who would be affected by
the EO and who were allegedly represented by
petitioners. It was the Sol Gen who pointed out that
there were about 594 employees in the NPO. The 67
petitioners undeniably comprised a small fraction of
the NPO employees, 32 of which subsequently
desisted. Further, only 20 petitioners were mentioned
in the jurat as having duly subscribed the petition
before the notary public.
An element of a class suit is the adequacy of
representation. In determining this, the court must
consider: 1) whether the interest of the party named is
coextensive with the interest of the other members; 2)
the proportion of those made a party to the total
membership of the class; and 3) any other factor
bearing on the ability of the named speak for the rest
of the class. Where the interests of the plaintiffs and
the other members of the class they seek to represent
are diametrically opposed, the class suit will not
prosper.


MIAA v. RIVERA LESSEE HOMEOWNERS
ASSOCIATIONS

Facts: The Civil Aeronautics Administration (CAA) was
entrusted with the administration of Manila Intl Airport
(now MIAA). CAA entered into a 25-year contract of
lease of 4 hectares of land in Rivera Village. On
January 1995, MIAA stopped accepted rental payments
from the lessees. As a result, Rivera Village Lessee
Homeowners Association (homeowners association)
requested MIAA to sell the leased property to its
members. MIAA denied the request because the
property is intended for airport-related activities.
Homeowners association filed a petition for mandamus
and prohibition with prayer for the issuance of a
preliminary injunction. RTC denied the petition. CA
issued a writ of preliminary injunction restraining MIAA
from evicting the members of Rivera Village
Association from their lots.

Issue: W/N Rivera Village Lessee Homeowners
Association has personality to sue. YES.

Held: It is a settled rule that every action must be
prosecuted or defended in the name of the real party-
in-interest. Where the action is allowed to be
prosecuted or defended by a representative acting in a
fiduciary capacity, the beneficiary must be included in
the title of the case and shall be deemed to be the real
party-in-interest. The name of such beneficiaries shall,
likewise, be included in the complaint.
In the case at bar, the petition was filed by the
homeowners association through its president. The
president is suing in a representative capacity as
authorized by a Board Resolution to file all the
necessary action in court to have the land titled to the
members of the association. Although the names of
the individual members of the homeowners association
who are the beneficiaries and real parties-in-interest in
the suit were not indicated in the title of the petition,
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this defect can be cured by the simple expedient of
requiring the association to disclose the names of the
principals and to amend the title and averments of the
petition accordingly.
The purpose of the rule that actions should be
brought or defended in the name of the real party-in-
interest is to protect against undue and unnecessary
litigation and to ensure that the court will have the
benefit of having before it the real adverse parties in
the consideration of a case. This rule is not to be
narrowly and restrictively construed, and its
application should be neither dogmatic nor rigid at all
times but viewed in consonance with extant realities
and practicalities. The dismissal of this case based on
the lack of personality to sue of petitioner-association
will only result in the filing of multiple suits by the
individual members of the association.

Ratio: Section 3, Rule 3: Where the action is allowed
to be prosecuted or defended by a representative or
someone acting in a fiduciary capacity, the
beneficiary shall be included in the title of the
case and shall be deemed to be the real party in
interest. A representative may be a trustee of an
express trust, a guardian, an executor or
administrator, or a party authorized by law or these
Rules. An agent acting in his own name and for the
benefit of an undisclosed principal may sue or be sued
without joining the principal except when the contract
involves things belonging to the principal.


NAPERE V. BARBARONA

FACTS:
- Barbarona is the owner of a parcel of land in
Leyte. A lot owned by Anacleto Napere
adjoined the lot of Barbarona on one side.
- When Anacleto Napere died, his son Juan
Napere and his wife (petitioner) planted
coconut trees on some portions.
- Barbarona then filed a complaint against Juan
Napere for encroaching on a portion of his lot
and cultivating the coconut planted on the
formers lot. Despite demands from Barbarona,
Napere refused to vacate.
- Juan Napere died. His counsel informed the
court about this but no formal substitution of
the heirs were made.
- Eventually, a judgment in favor of Barbarona
was rendered. The heirs of Napere appealed to
the CA that the judgment rendered was void
for lack of jurisdiction because of failure of the
court to formally substitute Naperes heirs to
the case. CA affirmed the RTC. Hence, this
petition.

ISSUE: W/N the judgment is void.

HELD/RATIO: NO. Failure of the court to formally
substitute the heirs of a party in a case which survives
his death does not render the judgment void. The
party alleging nullity must instead prove that there
was undeniable violation of due process.
The rule on substitution is not a matter of
jurisdiction but a requirement of due process. Thus, a
proceeding is void and the judgment nullified only if
the party who dies is not represented by any legal
representative or heir.
Formal substitution of heirs is not necessary
when they themselves appear in court, participate in
the case and present evidence in the defense of the
deceased. In this case, the heirs of Juan were present,
participated and testified for the defense of Juan.
Hence, formal substitution was not necessary. They
cannot claim denial of due process when they were
given every opportunity to participate in the trial.


SUMALJAG V. LITERATO

Facts: (1
st
civil case) Josefa Maglasang (Josefa) filed a
complaint with the RTC for the nullity of a deed of sale
of real property purportedly executed between her as
vendor and the spouses Diosdidit and Menendez
Literato (spouses) as vendees. Josefa was the sister of
Menendez and were 2 of the 6 heirs who inherited
equal parts of a property (Josefa w/ Lot 1220-D and
Menendez w/ Lot 1220-E) passed on to them by their
parents. The spouses responded by filing a
counterclaim denying Josefas allegation and
impleaded Josefa as a counterclaim defendant, alleging
that petitioner Judge Antonio Sumaljag (Sumaljag),
occupied both Lots 1220-D and E) at the instance of
Josefa w/out their authority. They claimed that Lot
1220-E is theirs by inheritance and Lot 1220-D by
purchase from Josefa. RTC dismissed the counterclaim.
(2
nd
civil case) After the RTC dismissed the
counterclaim, Menendez filed a complaint for
declaration of the inexistence of a lease contract,
recovery of possession of land and damages against
Sumaljag & Josefa.
Josefa died during pendency of both cases.
Atty. Puray, Sumaljag and Josefas common counsel,
filed a notice of death and substitution of party,
praying that Josefa be substituted by Sumaljag,
alleging that prior to her death, Josefa executed a
Quitclaim Deed over Lot 1220-D in favor
Maglasang(her nephew), who in turn sold the same to
Sumaljag. RTC denied the motion for substitution and
instead ordered Michaeles (Josefas sister) to serve as
Josefas representative. MR denied. CA upheld the
RTC.

Issue: W/N Sumaljag as a transferee pendete lite,
may substitute Josefa pursuant to Rule 3 of the Rules
of Court?

Held and Ratio: He cannot. The legal representatives
contemplated under Sec. 16, Rule 3 of the Rules refer
to those authorized by law the administrator,
executor or guardian, who, under the rule on
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settlement of estate of deceased persons, is
constituted to take over the estate of the deceased.
*Sec. 16, Rule 3 expressly provides that the heirs of
the deceased may be allowed to be substituted for the
deceased, without requiring the appointment of an
executor or administrator. Sumaljag is not one of
those mentioned. Instead he is a counterclaim co-
defendant of Josefa whose proffered justification for
substitution is the transfer to him of the interests of
Josefa in the litigation prior to her death.
Moreover, the notice of death and substitution
that Atty. Puray filed reflect a claim against the
interest of the Josefa through the transfer of her
remaining interest in the litigation to another party.
The reason for rule 3, section 16 on substitution is to
protect all concerned who may be affected by the
intervening death, particularly Josefa and her estate.
To suggest then that Sumaljag substitute Josefa would
bring to naught such protection since the transferee
who has his own interest to protect, cannot at the
same time represent and fully protect the interest of
the deceased transferor.
While Atty. Puray has every authority to
manifest to court changes in interest that transpire in
the course of litigation, pursuant to Sec. 19, Rule3,
this can only happen while the client-transferor was
alive and while the manifesting counsel was still the
effective and authorized counsel for the client-
transferor, not after the death of the client when the
lawyer-client relationship was terminated. Thus at
most, Sumaljag can be said to be a transferee pendete
lite whose status is pending with the lower court.
Lastly, the documents attached disclose that the
subject matter of the quitclaim is Lot 1220-E while the
subject matter of the deed of sale executed by
Maglasang in favor of Sumaljag is Lot 1220-D.

*The rule that it is only in case of unreasonable delay
in the appointment of an executor or administrator, or
where the heirs resort to an extrajudicial settlement of
the estate that the court may adopt the alternative of
allowing the heirs of the deceased to be substituted for
the deceased is no longer true.


HERITAGE PARK MANAGEMENT VS. CIAC

FACTS: Public Estates Authority (PEA) was designated
by the Bases Conversion Development Authority to
develop the first class memorial park known as the
Heritage Park, located in Fort Bonifacio, Taguig, Metro
Manila. PEA engaged the services of Elpidio Uy, doing
business under the name and style of EDC, under a
Landscaping and Construction Agreement. In the
agreement, EDC undertook to perform all landscaping
works on the 105 hectare Heritage Park, to be
completed within 450 days. Due to delays, the contract
period was extended to 693 days. Among the causes
of delay was PEAs inability to deliver to EDC 45
hectares of the property landscaping due to the
existence of squatters and public cemetery.
EDC constituted a complaint with the
Construction Industry Arbitration Commission (CIAC)
seeking to collect from PEA damages arising from its
delay in the delivery of the entire property for
landscaping. Damages include additional rental costs
for equipment which were kept on standby and labor
costs for idle manpower; added costs for the depletion
of topsoil of the original supplier; additional costs to
mobilize water trucks for the plants and trees which
had already been delivered at the site; and the
necessity to construct a nursery shade to protect and
preserve the young plants and trees prior to actual
transplanting at the landscaped area.
Sometime in March 2000, PEA executed a
Deed of Assignment in favor of Heritage Park
Management Corporation, whereby PEA and Heritage
agreed as follows:
1. That the ASSIGNOR hereby transfers, cedes
and assigns the development contracts
hereinbefore enumerated in favor of the
ASSIGNEE, including all rights, interests,
causes of action, and its corresponding
obligations under said contracts.
2. That the ASSIGNEE hereby accepts the
assignment of all contracts herein before
listed, which were entered into and executed
by ASSIGNOR as Project Manager of the
Heritage Park Project, approved and confirmed
by the HPP Execom, and shall assume
ASSIGNORs rights, interests and
responsibilities, obligations, undertakings and
liabilities arising from the said contracts
including judgment awards, costs or expenses
relative to the said contracts, particularly the
terrasoleum 1B & 4 and the Landscaping
contract, which are now subject of litigation
pending before various courts in Paraaque,
and the Construction Industry Arbitration
Commission.
In April 2000, Heritage filed a petition with the
CA for prohibition/injunction with prayer for
preliminary injunction and temporary restraining order
against CIAC and EDC. It alleged that CIAC has no
jurisdiction over the Heritage Park Project funds
against which any award against the PEA would be
enforced. Heritage also alleged that it has complete
control, custody, and authority over the funds and has
never submitted itself and the funds to CIACs arbitral
jurisdiction.
However, CIAC has already finished hearing
the case and rendered a decision in favor of EDC.

ISSUE#1:
WON the CIAC decision is null and void for having been
conducted and resolved without impleading an
indispensable party???

RULING:
NO. The decision is valid and binding.
When the case was filed by EDC with CIAC on January
2000, PEA had not yet transferred its rights and
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obligations over the Project to Heritage. By impleading
PEA as respondent, the CIAC had jurisdiction over the
case at that time. Heritage, however, claims that when
PEA transferred its rights and obligations over the
Project to Heritage, the CIAC lost its jurisdiction. In
other words, Heritage alleges that a court may lose
jurisdiction over a case based on the subsequent
actions of the parties. This is unacceptable.
The settled rule is that jurisdiction once
acquired is not lost upon the instance of the parties but
continues until the case is terminated. Certainly, it
would be the height of injustice to allow parties that
disagree with the decision of a judicial tribunal to annul
the same through the expedient of transferring their
interests or rights involved in the case.

ISSUE#2: (RULE 3)
WON Heritage is an indispensable party???

RULING:
NO. It is a proper but not an indispensable party.
Heritage is mistaken when it claims that it is an
indispensible party to the case and that it was not
included in the case before the CIAC. Being a
transferee of the interests of PEA over the Project
during the pendency of the case before the CIAC, it is
bound by the proceedings in like manner as PEA.
Rule 3 of Section 20 (now Section 19, Rule 3) of the
Rules of Court provides:
SEC. 20. Transfer of Interest. In case of any transfer
of interest, the action may be continued by or against
the original party unless the court upon motion directs
the person to whom the interest is transferred to be
substituted in the action or joined with the original
party.
This Court has declared in a number of
decisions that a transferee pendente lite stands in
exactly the same position as its predecessor-in-
interest, the original defendant, and is bound by the
proceedings had in the case before the property was
transferred to it. It is a proper but not an
indispensible party as it would in any event be
bound by the judgment against his predecessor.
This would follow even if it is not formally
included as a defendant through an amendment
of the complaint.
Verily, the non-inclusion of Heritage in the
proceedings before the CIAC is of no moment as the
Rules of Court specifically allows the proceedings to
proceed with the original parties while binding the
transferee.


ALGURA VS LGU OF NAGA

Facts. On September 1, 1999, spouses Algura filed a
Verified Complaint for damages against the Naga City
Government and its officers, arising from the alleged
illegal demolition of their residence and boarding house
and for payment of lost income derived from fees paid
by their boarders (7k/month). Simultaneously,
petitioners filed an Ex-Parte Motion to Litigate as
Indigent Litigants, to which petitioner Antonio Algura's
Pay Slip was appended, showing a gross monthly
income of P10,474 and a net pay of P3,616.99 for July
1999. Also attached to the motion was a
Certification issued by the Office of the City Assessor,
which stated that the Alguras had no property
declared. Executive Judge Atienza granted petitioners'
plea for exemption from filing fees.
On March 13, 2000, respondents filed a Motion
to Disqualify the Plaintiffs for Non-Payment of Filing
Fees dated March 10, 2000. They asserted that in
addition to the more than PhP 3,000.00 net income of
petitioner Antonio Algura, who is a member of the PNP,
spouse Lorencita Algura also had a mini-store and a
computer shop. Also, respondents claimed that
petitioners' second floor was used as their residence
and as a boarding house, from which they earned
more than PhP 3,000.00 a month. In addition, it was
claimed that petitioners derived additional income from
their computer shop patronized by students and from
several boarders who paid rentals to them. Hence,
respondents concluded that petitioners were not
indigent litigants.
RTC issued an Order disqualifying petitioners
as indigent litigants on the ground that they failed to
substantiate their claim for exemption from payment
of legal fees and to comply with the third paragraph of
Rule 141, Section 18 of the Revised Rules of Court.
The spouses filed a MR. RTC Acting Presiding
Judge denied the petition and ratiocinated that the pay
slip of Antonio F. Algura showed that the GROSS
INCOME or TOTAL EARNINGS of Algura [was]
10,474.00 which amount was over and above the
amount mentioned in the first paragraph of Rule
141, Section 18 (P3,000) for pauper litigants residing
outside Metro Manila."

Issue. Whether petitioners should be considered as
indigent litigants who qualify for exemption from
paying filing fees. YES

Held. It is undisputed that the Complaint (Civil Case
No. 99-4403) was filed on September 1, 1999.
However, the Naga City RTC, in its April 14, 2000 and
July 17, 2000 Orders, incorrectly applied Rule 141,
Section 18 on Legal Fees when the applicable rules
at that time were Rule 3, Section 21 on Indigent
Party which took effect on July 1, 1997 and Rule 141,
Section 16 on Pauper Litigants which became
effective on July 19, 1984 up to February 28, 2000.
The old Section 16, Rule 141 requires
applicants to file an ex-parte motion to litigate as a
pauper litigant by submitting an affidavit that they do
not have a gross income of PhP 2,000.00 a month or
PhP 24,000.00 a year for those residing in Metro
Manila and PhP 1,500.00 a month or PhP 18,000.00 a
year for those residing outside Metro Manila or those
who do not own real property with an assessed value
of not more than PhP 24,000.00 or not more than PhP
18,000.00 as the case may be. Thus, there are two
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requirements: a) income requirementthe
applicants should not have a gross monthly income of
more than PhP 1,500.00, and b) property
requirementthey should not own property with an
assessed value of not more than PhP 18,000.00.
In the case at bar, petitioners Alguras
submitted the Affidavits of petitioner Lorencita Algura
and neighbor Erlinda Bangate, the pay slip of petitioner
Antonio F. Algura showing a gross monthly income of
PhP 10,474.00, and a Certification of the Naga City
assessor stating that petitioners do not have property
declared in their names for taxation. With respect to
the income requirement, it is clear that the gross
monthly income of PhP 10,474.00 of petitioner Antonio
F. Algura and the PhP 3,000.00 income of Lorencita
Algura when combined, were above the PhP 1,500.00
monthly income threshold prescribed by then Rule
141, Section 16 and therefore, the income requirement
was not satisfied. The trial court was therefore correct
in disqualifying petitioners Alguras as indigent litigants
although the court should have applied Rule 141,
Section 16 which was in effect at the time of the filing
of the application on September 1, 1999. Even if Rule
141, Section 18 (which superseded Rule 141, Section
16 on March 1, 2000) were applied, still the application
could not have been granted as the combined PhP
13,474.00 income of petitioners was beyond the PhP
3,000.00 monthly income threshold.
Petitioners however argue in their MR that the
rules have been relaxed by relying on Rule 3, Section
21 of the 1997 Rules of Civil procedure which
authorizes parties to litigate their action as indigents if
the court is satisfied that the party is "one who has no
money or property sufficient and available for food,
shelter and basic necessities for himself and his
family." The trial court did not give credence to this
view of petitioners and simply applied Rule 141 but
ignored Rule 3, Section 21 on Indigent Party.
The position of petitioners on the need to use
Rule 3, Section 21 on their application to litigate as
indigent litigants brings to the fore the issue on
whether a trial court has to apply both Rule 141,
Section 16 and Rule 3, Section 21 on such applications
or should the court apply only Rule 141, Section 16
and discard Rule 3, Section 21 as having been
superseded by Rule 141, Section 16 on Legal Fees.
The Court rules that Rule 3, Section 21
and Rule 141, Section 16 (later amended as Rule
141, Section 18 on March 1, 2000 and subsequently
amended by Rule 141, Section 19 on August 16, 2003,
which is now the present rule) are still valid and
enforceable rules on indigent litigants.
For one, the history of the two seemingly
conflicting rules readily reveals that it was not the
intent of the Court to consider the old Section 22 of
Rule 3, which took effect on January 1, 1994 to have
been amended and superseded by Rule 141, Section
16, which took effect on July 19, 1984 through A.M.
No. 83-6-389-0. Furthermore, Rule 141 on indigent
litigants was amended twice: first on March 1, 2000
and the second on August 16, 2004; and yet, despite
these two amendments, there was no attempt to
delete Section 21 from said Rule 3. This clearly evinces
the desire of the Court to maintain the two (2) rules on
indigent litigants to cover applications to litigate as an
indigent litigant.
Instead of declaring that Rule 3, Section 21
has been superseded and impliedly amended by
Section 18 and later Section 19 of Rule 141, the Court
finds that the two rules can and should be harmonized.
The Court opts to reconcile Rule 3, Section 21 and Rule
141, Section 19 because it is a settled principle
that when conflicts are seen between two provisions,
all efforts must be made to harmonize them. In the
light of the foregoing considerations, therefore, the
two (2) rules can stand together and are compatible
with each other.
When an application to litigate as an indigent litigant is
filed, the court shall scrutinize the affidavits
and supporting documents submitted by the applicant
to determine if the applicant complies with the
income and property standards prescribed in the
present Section 19 of Rule 141. If the trial court finds
that the applicant meets the income and property
requirements, the authority to litigate as indigent
litigant is automatically granted and the grant is a
matter of right.
However, if the trial court finds that one or both
requirements have not been met, then it would
set a hearing to enable the applicant to prove that the
applicant has "no money or property sufficient and
available for food, shelter and basic necessities
for himself and his family." In that hearing, the
adverse party may adduce countervailing evidence to
disprove the evidence presented by the applicant; after
which the trial court will rule on the application
depending on the evidence adduced.
Recapitulating the rules on indigent litigants,
therefore, if the applicant for exemption meets the
salary and property requirements under Section 19 of
Rule 141, then the grant of the application is
mandatory. On the other hand, when the application
does not satisfy one or both requirements, then the
application should not be denied outright; instead, the
court should apply the "indigency test" under Section
21 of Rule 3 and use its sound discretion in
determining the merits of the prayer for exemption.

RULE 5: VENUE

SPS. RENATO & ANGELINA LANTIN vs. HON.
JANE AURORA C. LANTION

Facts: Petitioners Spouses Renato and Angelina Lantin
took several peso and dollar loans from respondent
Planters Development Bank (Planters) and executed
several real estate mortgages and promissory notes to
cover the loans. They defaulted on the payments so
Planters foreclosed the mortgaged lots. The foreclosed
properties were sold at a public auction where Planters
was the winning bidder. Spouses Lantin filed against
Planters and its officers a Complaint for Declaration of
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Nullity and/or Annulment of Sale and/or Mortgage,
Reconveyance, Discharge of Mortgage, Accounting,
Permanent Injunction, and Damages with the RTC of
Lipa City, Batangas. Spouses alleged that only their
peso loans were covered by the mortgages and that
these had already been fully paid, hence, the
mortgages should have been discharged. They
challenged the validity of the foreclosure on the
alleged non-payment of their dollar loans as the
mortgages did not cover those loans. Private
respondents moved to dismiss the complaint on the
ground of improper venue since the loan agreements
restricted the venue of any suit in Metro Manila.
Respondent Judge Lantion dismissed the case for
improper venue.

Issue: WON respondent judge committed grave abuse
of discretion when she dismissed the case for improper
venue NO!

Ratio: According to the spouses, the venue stipulation
in the loan documents is not an exclusive venue
stipulation under Section 4(b) of Rule 4 of the 1997
Rules of Civil Procedure.The venue in the loan
agreement was not specified with particularity.
Further, the spouses also contend that since the
complaint involves several causes of action which did
not arise solely from or connected with the loan
documents, the cited venue stipulation should not be
made to apply.
The general rules on venue of actions under
Section 4 (b) of Rule 4 of the 1997 Rules of Civil
Procedure shall not apply where the parties, before the
filing of the action, have validly agreed in writing on an
exclusive venue. The mere stipulation on the venue of
an action, however, is not enough to preclude parties
from bringing a case in other venues. The parties must
be able to show that such stipulation isexclusive. In
the absence of qualifying or restrictive words, the
stipulation should be deemed as merely an agreement
on an additional forum, not as limiting venue to the
specified place.
The pertinent provisions of the several real
estate mortgages and promissory notes executed by
the petitioner respectively read as follows: 18. In the
event of suit arising out of or in connection with this
mortgage and/or the promissory note/s secured by this
mortgage, the parties hereto agree to bring their
causes of auction exclusively in the proper court of
Makati, Metro Manila or at such other venue chosen by
the Mortgagee, the Mortgagor waiving for this purpose
any other venue.
Clearly, the words "exclusively" and "waiving
for this purpose any other venue" are restrictive and
used advisedly to meet the requirements.
Further, since the issues of whether the
mortgages should be properly discharged and whether
these also cover the dollar loans, arose out of the said
loan documents, the stipulation on venue is also
applicable thereto.


SAN MIGUEL CORPORATION VS TROY FRANCIS
MONASTERIO

Facts: San Miguel entered into an Exclusive Warehouse
Agreement (EWA) with SMB Warehousing Service
represented by Monasterio (this was for San Miguels
route operations at Sorsogon and Camarines Norte).
In addition, the EWA also contained a
stipulation on venue of actions. It was provided that
should it be necessary that an action be brought in
court... that the proper court should be in the courts of
Makati or Pasig, Metro Manila, to the exclusion of the
other courts at the option of the company.
Monasterio, a resident of Naga, filed a
complaint for collection of sum of money against San
Miguel before the RTC of Naga City. He was claiming
P900,600 for unpaid cashiering fees. It was alleged
that aside from rendering services as a
warehouseman, he was given the additional task of
cashiering at San Miguels sorsogon and camarines
norte sales offices and was promised a separate fee for
it.
San Miguel filed a motion to dismiss on the
ground of improper venue. San Miguel alleged that
Monasterios money claim for unpaid cashiering
services arose from his function as a warehouse
contractor and thus the EWA should be followed. San
Miguel cited Sec4b in relation to Sec2 of Rule4 of the
Rules of Court allowing agreement of parties on
exclusive venue of actions.
Monasterio opposed saying that the cashiering
service was distinct and separate from the services
under the EWA. Thus, EWA being inapplicable he can
file at Naga City.
RTC: denied the motion to dismiss. EWA
limited to warehousing services only. MR was filed.
While MR was pending, Monasterio filed an amended
complaint deleting his claim for unpaid warehousing
and cashiering fees but increasing the demand for
damages.
CA: San Miguel appealed via certiorari. CA held
that cashiering service inseparable from warehousing
service thus, EWA should be followed as to stipulation
of venue. However, since Monasterio filed an amended
complaint, CA dismissed the petition for certiorari
because the case was now moot and academic.

Issue: Whether the EWA should be followed as to
venue?

Held: EWA stipulation on venue is clear so it should
be respected. But the cause of action of Monasterio
was not based on the EWA. In the amended complaint,
Monasterio specifically limited the cause of action to
the collection of the sum owing to him for his
cashiering service. He omitted the warehousing fees
only (this part confuses me because the case said
earlier that the warehousing AND cashiering fees were
deleted).
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Allegations in the complaint determines the
nature of the case. Thus, contrary to what the CA
ruled, the case is a collection suit pertaining solely to
the cashiering service.
Exclusive venue stipulation embodied in a
contract restricts or confines parties thereto when the
suit relates to the breach of such contract. But if the
exclusivity clause is not all encompassing, such that
even those not related to the enforcement of the
contract should be subjected to the exclusive venue,
then the stipulation designating exclusive venues
should be strictly confined to the specific agreement.
Besides, restrictive stipulations are in
derogation of the general policy of making it more
convenient for the parties to institute actions arising or
in relation to their agreement. Thus, said restriction
should be strictly construed as relating solely to the
agreement in which the exclusivity clause is embodied.
Lastly, since convenience is the reason behind
the rules on venues, venue stipulations should be
deemed merely permissive. The interpretation to be
adopted should be that which most serves the parties
convenience. Otherwise, the rules of court will govern.


IRENE MARCOS-ARANETA VS. CA

FACTS: Irene and several co-plaintiffs filed a case
before the RTC of Batac, Ilocos Norte against
Benedicto and his business associates for conveyance
of shares of stocks. Irene alleges that several years
back, Benedicto created 2 companies where 65% of
the shareholdings were being held by Benedicto and
associates in trust for Irene. Benedicto filed a motion
to dismiss on the ground that the venue is improperly
laid. Benedicto was claiming that Irene is not a
resident of Batac but rather, a resident of Makati City.
Irene, on the other hand, claims that her co-plaintiffs
are residing in Batac.
RTC: venue improperly laid since Irene is a
resident of Makati and not Batac.
CA: since co-plaintiffs are residents of Batac,
venue is not improperly laid

Issue: Is the venue improperly laid?

SC: YES. Motion to dismiss granted.
First of all, the action is one in personam. The fact
that the companies assets include properties does not
materially change the nature of the action.
Second, there can be no serious dispute that
the real party-in-interest plaintiff is Irene. As self-
styled beneficiary of the disputed trust, she stands to
be benefited or entitled to the avails of the present
suit. It is undisputed too that three other persons, all
from Ilocos Norte, were included as co-plaintiffs in the
complaint as Irene's new designated trustees. As
trustees, they can only serve as mere representatives
of Irene.
Sec. 2 of Rule 4 indicates quite clearly that
when there is more than one plaintiff in a personal
action case, the residences of the principal parties
should be the basis for determining proper venue.
According to the late Justice Jose Y. Feria, "the word
`principal' has been added [in the uniform procedure
rule] in order to prevent the plaintiff from choosing the
residence of a minor plaintiff or defendant as the
venue."

Eliminate the qualifying term "principal" and
the purpose of the Rule would "be defeated where a
nominal or formal party is impleaded in the action
since the latter would not have the degree of interest
in the subject of the action which would warrant and
entail the desirably active participation expected of
litigants in a case."

SUMMARY PROCEDURE (RULE 5,
1991 Rules on Summary Procedure
as amended)

ESTATE OF MACADANGDANG V. GAVIOLA ET AL.

FACTS: Atty. Macadangdang is the administrator for
the Estate of Felomina Macadangdang. He filed a case
against all the respondents (madami sila, 12, all
unrelated) for Unlawful Detainer. Respondents were
occupying by mere tolerance, 4 parcels of land in the
name of the late Felomina. The MTCC of Davao ruled in
favor of the Estate. Respondents were ordered to
vacate the land, remove their structures, pay
damages.
Respondents appealed to the RTC, which
dismissed the appeal for failure to file an appeal
memorandum. Respondents then filed a Motion for
Reconsideration/ New Trial, which RTC denied, ruling
that it no longer had jurisdiction over the motion after
the dismissal of the appeal. (Meanwhile, the MTCC
ordered the issuance of a writ of execution).
Undaunted, the respondents filed a petition for
review with the CA. It ruled that the order of the RTC
dismissing the appeal for failure of filing an appeal
memorandum should be set aside, since the dismissal
of an appeal on purely technical ground is frowned
upon. (Not so important: It also said that there is a
difference between failure to file a notice of appeal
within the reglementary period and failure to file the
appeal memorandum. The former would result to
failure of the court to obtain jurisdiction, but the latter
would only result to abandonment of appeal, which
could lead to its dismissal upon failure to move for
reconsideration). Thus, it ruled the RTC erred in
denying the MR.
In the present case, Atty. Macadangdang
argues that the CA erred when it allowed the filing of
MR before the RTC. Because this case originated from
an unlawful detainer case where the Rules on
Summary Procedure apply, then the MR is a prohibited
pleading.

Issue: is MR a prohibited pleading in this case? No.

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Ruling: Jurisdiction over forcible entry and unlawful
detainer cases fall with the M(etropolitan)TC, MTCC,
M(unicipal)TC, MCTCs. Since the case was one for
unlawful detainer, it was governed by the Rules on
Summary Procedure. The purpose of the Rules is to
prevent undue delays in the disposition of cases and to
achieve this, filing of certain pleadings is not allowed,
including the filing of an MR.
However, the MR in this case was filed before
the RTC acting as an appellate court. Thus, the appeal
before the RTC is no longer covered by the Rules on
Summary Procedure. The Rules only apply before
appeal to the RTC, hence the MR before the RTC is not
a prohibited pleading.

[Minor issues: On the failure to file an appeal
memorandum and negligence of counsel. Rule 40 of
the Rules of Court states that within 15 days from
notice of appeal, it is the duty of the appellant to
submit a memorandum and failure to do so is a ground
for dismissal of appeal. Here, the excuse for failure to
file was the negligence of respondents counsel. CA
held that the respondents were not bound by their
lawyers gross negligence. SC disagrees. Failure of the
counsel to file the appeal memo is due to heavy
backlog of paperwork this is not gross negligence.
Moreover, the respondents were not deprived of due
process since appeal is not part thereof. It is merely a
statutory privilege and may be exercised only in
accordance with provisions of the law.]
Petition is granted, the CA decision is set aside
and reversed.


BONGATO V. MALVAR

Facts: Spouses Severo and Trinidad Malvar filed a
complaint for forcible entry against Petitioner Teresita
Bongato, alleging that the latter unlawfully entered a
parcel of land which belonged to the spouses and
erected thereon a house of light materials. Petitioner
Bongato filed an extension of time to file an answer
which the MTCC denied because it said it was
proscribed under the Rule on Summary Procedure and
likewise containing no notice of hearing. Petitioner, on
several occasions, changed counsels, each of which
filed an answer and a motion to dismiss respectively.
Both were denied by the MTCC. The answer was
denied because it was filed beyond the ten-day
reglementary period while the motion to dismiss was
denied as being contrary to the Rule on Summary
Procedure.
MTCC rendered a decision ordering petitioner
Bongato to vacate the land in question, and to pay
rentals, attorneys fees, and the costs of the suit. RTC
affirmed. Petitioner Bongato filed an MR.
Respondent Judge issued an order granting the
motion for reconsideration only insofar as to
determine the location of the houses involved in this
civil case so that the Court will know whether they are
located on one and the same lot or a lot different from
that involved in the criminal case for Anti-Squatting.
In the same order, respondent Judge disallowed any
extension and warned that if the survey is not made,
the court might consider the same abandoned and the
writ of execution would be issued.
Petitioner still filed a motion for extension of the
deadline for the submission of the relocation survey.
This was obviously denied as respondent Judge noted
that no survey report was submitted and ordered the
record of the case returned to the court of origin for
disposal. CA affirmed the MTCC.

Issues:
1. Whether or not the cause of action for forcible
entry has prescribed? YES, IT HAS
PRESCRIBED.
2. Whether or not a motion to dismiss based on
lack of jurisdiction is a prohibited pleading
under the Rules of Summary Procedure? IT IS
ALLOWED.

Held:
1. It is wise to be reminded that forcible entry is
a quieting process, and that the restrictive
time bar is prescribed to complement the
summary nature of such process. Indeed, the
one-year period within which to bring an action
for forcible entry is generally counted from the
date of actual entry to the land. However,
when entry is made through stealth, then the
one-year period is counted from the time the
plaintiff learned about it. After the lapse of the
one-year period, the party dispossessed of a
parcel of land may file either an accion
publiciana, which is a plenary action to recover
the right of possession; or an accion
reivindicatoria, which is an action to recover
ownership as well as possession.
On the basis of the foregoing facts, it is
clear that the cause of action for forcible entry
filed by respondents had already prescribed
when they filed the Complaint for ejectment.
Hence, even if Severo Malvar may be the
owner of the land, possession thereof cannot
be wrested through a summary action for
ejectment of petitioner, who had been
occupying it for more than one (1) year.
Respondents should have presented their suit
before the RTC in an accion publiciana or an
accion reivindicatoria, not before the MTCC in
summary proceedings for forcible entry. Their
cause of action for forcible entry had
prescribed already, and the MTCC had no more
jurisdiction to hear and decide it.

2. Petitioner further argues that a motion to
dismiss based on lack of jurisdiction over the
subject matter is not a prohibited pleading, but
is allowed under Sec. 19(a) of the Revised
Rule on Summary Procedure. We agree.
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The Rule on Summary Procedure was
promulgated specifically to achieve an
expeditious and inexpensive determination of
cases. The speedy resolution of unlawful
detainer cases is a matter of public policy,
and the Rule should equally apply with full
force to forcible entry cases, in which
possession of the premises is already illegal
from the start. For this reason, the Rule frowns
upon delays and prohibits altogether the filing
of motions for extension of time. Consistently,
Section 6 was added to give the trial court the
power to render judgment, even motu proprio,
upon the failure of a defendant to file an
answer within the reglementary period.
However, as forcible entry and detainer
cases are summary in nature and involve
disturbances of the social order, procedural
technicalities should be carefully avoided and
should not be allowed to override substantial
justice.
Pursuant to Section 36 of BP 129, the
Court on June 16, 1983, promulgated the Rule
on Summary Procedure in Special Cases.
Under this Rule, a motion to dismiss or quash
is a prohibited pleading. Under the 1991
Revised Rule on Summary Procedure,
however, a motion to dismiss on the ground of
lack of jurisdiction over the subject matter is
an exception to the rule on prohibited
pleadings.
Further, a courts lack of jurisdiction
over the subject matter cannot be waived by
the parties or cured by their silence,
acquiescence or even express consent. A party
may assail the jurisdiction of the court over the
action at any stage of the proceedings and
even on appeal. That the MTCC can take
cognizance of a motion to dismiss on the
ground of lack of jurisdiction, even if an
answer has been belatedly filed we likewise
held in Bayog v. Natino.
The Revised Rule on Summary
Procedure, as well as its predecessor,
do not provide that an answer filed
after the reglementary period should
be expunged from the records. As a
matter of fact, there is no provision for
an entry of default if a defendant fails
to answer. It must likewise be pointed
out that MAGDATOs defense of lack of
jurisdiction may have even been raised
in a motion to dismiss as an exception
to the rule on prohibited pleadings in
the Revised Rule on Summary
Procedure. Such a motion is allowed
under paragraph (a) thereof, x x x.
In the case at bar, the MTCC should
have squarely ruled on the issue of jurisdiction,
instead of erroneously holding that it was a
prohibited pleading under the Rule on
Summary Procedure. Because the Complaint
for forcible entry was filed on July 10, 1992,
the 1991 Revised Rule on Summary Procedure
was applicable.


BANARES V. BALISING

Facts: Balising filed complaints for estafa against
Banares and other accused. They pleaded not guilty
and filed a motion to dismiss on the ground that the
filing of the same was premature, in view of the failure
of the parties to undergo conciliation proceedings
before the Lupong Tagapamayapa. Banares
furthermore contended that since they lived in the
same barangay and the amount involved in each of the
cases did not exceed P200.00, the cases were to be
referred to the Lupong Tagapamayapa first before
being filed in court (based on the LGC and Rules on
Summary Procedure).
The MTC ruled in favour of Banares and
dismissed the cases pursuant to the Rules on
Summary Procedure. After 2 months, Balising filed a
motion to revive the criminal cases stating that the
requirement of referral to the Lupon had already been
complied with. This was granted by the MTC.
Banares contends that he Order of the MTC
dismissing the cases had long become final and
executory, thus Balising should have re-filed the cases
instead of filing a motion to revive.
Balising, on the other hand, claimed that the
revival was in accordance with sec. 18 of the Rules on
Summary Procedure. They state that the rule on
finality of judgments do not apply to cases covered by
the Rules on Summary Procedure. They further insist
that cases dismissed without prejudice for non-
compliance with the requirement of conciliation before
the Lupong Tagapamayapa may be revived summarily
by the filing of a motion to revive regardless of the
number of days which has lapsed after the dismissal of
the case.

Issue: Does the rule on finality of judgments apply to
the Rules on Summary Procedure? YES.

Ruling: First, one must distinguish between a final
order and interlocutory order. A "final order" issued by
a court has been defined as one which disposes of the
subject matter in its entirety or terminates a particular
proceeding or action, leaving nothing else to be done
but to enforce by execution what has been determined
by the court. As distinguished therefrom, an
"interlocutory order" is one which does not dispose of a
case completely, but leaves something more to be
adjudicated upon. Previous jurisprudence state that an
order dismissing a case without prejudice is a final
order if no motion for reconsideration or appeal
therefrom is timely filed. As such, the dismissal of the
criminal cases against Banares is a final order.
The law grants an aggrieved party a period of
15 days from his receipt of the court's decision or
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order disposing of the action or proceeding to appeal
or move to reconsider the same. After the lapse of the
fifteen-day period, an order becomes final and
executory and is beyond the power or jurisdiction of
the court which rendered it to further amend or
revoke.
But what about the contention of Balising that
these rules do not apply to the Rules on Summary
Procedure? THIS IS WRONG! First, let us take a look at
Sec. 18 of the Rules on Summary Procedure. It states
that cases requiring referral to the Lupon for
conciliation under the provisions of Presidential Decree
No. 1508 where there is no showing of compliance with
such requirement, shall be dismissed without
prejudice, and may be revived only after such
requirement shall have been complied with. This
provision shall not apply to criminal cases where the
accused was arrested without a warrant.
The contention of Balising that the case may
be revived by a motion is wrong because Section 18
merely states that when a case covered by the 1991
Revised Rule on Summary Procedure is dismissed
without prejudice for non-referral of the issues to the
Lupon, the same may be revived only after the dispute
subject of the dismissed case is submitted to barangay
conciliation as required under the Local Government
Code. There is no declaration to the effect that said
case may be revived by mere motion even after the
fifteen-day period within which to appeal or to file a
motion for reconsideration has lapsed.
Lastly, Sec. 22 of the Rules on Summary
Procedure state that the regular procedure prescribed
in the Rules of Court shall apply to the special cases
herein provided for in a suppletory capacity insofar as
they are not inconsistent therewith.


MADERADA VS. MEDIODEA

Facts: Judge Mediodea was charged with gross
ignorance of the law for failing to apply the Revised
Rules on Summary Procedure to an action for forcible
entry with prelim injunction, TRO and damages.
Maderada was the complainant in the forcible
entry case. Mediodea required the defendants to show
cause why the prelim injunction should not be granted.
Hearing was scheduled but, upon the instigation of the
defendants, the hearing was reset by Mediodea. The
hearing was again reset after the defendants
questioned the authority of Maderada to appear as
counsel for her co-plaintiff (may kasama siyang
complainant dun sa forcible entry case). Mediodea then
gave the defendants 10 days more to file the
corresponding motion. Meanwhile, Maderada filed a
total of 3 motions praying for judgment to be
rendered. These were all denied by Mediodea because
of the pending hearing for the issuance of a restraining
order and an injunction. (In short, ang daming motions
during the case).
Mediodea argued that the delay in the
resolution of the case should not be attributed to him
because he was duty-bound to resolve all the motions
filed by the parties. The OCA recommended that
Mediodea be fined and given a stern warning because
of the delay. It said that while it is true that the prelim
injunction prayed for should first be resolved before
making a judgment, the same should be done within
30 days from the filing thereof. The OCA took note that
the motion for prelim injunction as well as the case
itself remained unresolved even after 4mos had
already lapsed since the action was filed.

Issue: W/N Mediodea for liable for the delay?

Held/Ratio: Yup!
Forcible entry and unlawful detainer actions are
covered by summary procedure
The ROC clearly provide that actions for
forcible entry and unlawful detainer, regardless of the
amount of damages or unpaid rentals sought to be
recovered, shall be governed by the Rule on Summary
Procedure. These actions are summary in nature,
because they involve the disturbance of the social
order, which should be restored as promptly as
possible. Designed as special civil actions, they are
governed by the Rules on Summary Procedure to
disencumber the courts from the usual formalities of
ordinary actions. Accordingly, technicalities or details
of procedure that may cause unnecessary delays
should be carefully avoided. The actions for forcible
entry and unlawful detainer are designed to provide
expeditious means of protecting actual possession or
the right to possession of the property involved. Both
are "time procedures" designed to bring immediate
relief.

Preliminary injunction
This is a provisional remedy. So it should be
resolved before judgment. Nonetheless, Sec. 15 of
Rule 70 clearly states that this should be resolved
within 30 days from its filing. Mediodea should have
known that since a prayer for preliminary injunction is
merely a provisional remedy in an action for forcible
entry, it should lend itself to the summary nature of
the main case. This is the very reason why the ROC
mandate that a preliminary injunction in a forcible
entry case be decided within 30 days from its filing.
Preliminary injunctions and TROs are extraordinary
remedies provided by law for the speedy adjudication
of an ejectment case in order to save the dispossessed
party from further damage during the pendency of the
original action.

Reminder to judges
Judges are bound to dispose of the courts
business promptly and to decide cases within the
required period. They are called upon to observe
utmost diligence and dedication in the performance of
their judicial functions and duties.



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PLEADINGS

JOCSON v. CA

FACTS: Petitioner Jocson filed a complaint for
Reconveyance and Damages against Marcelo Steel
Corp & Maria Cristina Fertilizer Corp (MCFC). The trial
Court rendered a decision in favor of Jocson, directing
the execution sale to satisfy the judgment against
respondents. Respondents appealed to the CA. CA
decided in favor of Jocson. Respondents no longer
appealed the CA decision, making such final &
executory. The execution sale pushed through, with
Tiusing winning as the highest bidder.
Marcelo Steel filed a motion to annul said sale,
stating that its obligation was joint, instead of solidary,
and that the total price of the properties sold on
execution was extremely inadequate. Trial court ruled
in favor of Marcelo Steel. Jocson moved for
reconsideration. Tiusing also filed a Motion for
Intervention, as he was the winner of the auction. Trial
court denied both. Jocson filed a Notice of Appeal,
which she later withdrew. In lieu of such, both Jocson
& Tiusing filed a Petition for Certiorari with the CA. CA
denied. Both filed a motion for reconsideration, but
was again, denied.
Jocson, in the meantime, filed a Motion for
Motion for Issuance of Alias Writ of Execution to
implement the decision against MCFC.

ISSUE: W/N the withdrawal of the Notice of Appeal
may be done by substituting such with a Petition for
Certiorari? - NO.

RATIO: The petition was only signed by Tiusings
counsel, supposedly on behalf of Jocsons. However,
the rules provide that every pleading must be signed
by all the petitioners or their respective counsels,
otherwise, such pleadings produce no legal effect.
Only Tiusing signed the Verification &
Certification of non-forum shopping. Jocson did not
sign such, despite the rules stating that every petition
for certiorari must be verified. Although Tiusing filed a
Special Power of Attorney authorizing him to file,
verify & certify the petition, such was done only 4
months after the petition was filed, with no explanation
as to why it was belatedly filed.
In addition, Jocson already filed a Motion for
Issuance of Alias Writ of Execution to executed the
decision against the other respondent, MCFC. The filing
of this is incompatible with a Petition for Review,
because such means that Jocson already recognizes
that the judgment against Marcelo Steel is still
pending, thus only executing the decision against the
other respondent.


AGANA v. LAGMAN

FACTS: Petitioner filed a complaint for annulment of
title, with prayer for preliminary mandatory injunction
against respondent, claiming that she is the sole heir
of Cruz, thus she is the sole owner of the lot, which
was fraudulently sold to Lopez, who subsequently sold
such to respondent.
Respondent filed an Answer with Compulsory
Counterclaim. Petitioner filed a motion to dismiss
respondents counterclaim for lack of certificate of non-
forum shopping. Trial court denied the motion. Upon
petitioners MR, TC reversed itself, dismissing
respondents counterclaim. But TC again recalled its
order dismissing the counterclaim.

ISSUE: W/N a compulsory counterclaim requires a
certificate of non-forum shopping? - NO.

RATIO: The SC Administrative Circular, with respect to
the need for a certificate of non-forum shopping for
counterclaims refer only to initiatory pleadings. This
does not include compulsory counterclaims, as these
are merely reactions or responses to the complaint. If
one does not include a compulsory counterclaim in its
answer, then such is deemed waived.
Permissive counterclaims, however, are
considered initiatory pleadings. Thus, non-inclusion of
a certificate of non-forum shopping in permissive
counterclaims is deemed fatal.
Compulsory Counterclaim of respondent: That
because of the unwarranted, baseless, and unjustified
acts of the plaintiff, herein defendant has suffered and
continue to suffer actual damages in the sum of at
least P400M which the law, equity and justice require
that to be paid by the plaintiff and further to reimburse
the attorneys fees of P200M.


IGLESIA NI KRISTO v. PONFERRADA

FACTS: Enrique Santos was the owner of a 936-
square-meter parcel of land located in Tandang Sora,
Quezon City covered by Transfer Certificate of Title
issued by the Register of Deeds on July 27, 1961 which
cancelled TCT No. 57193-289.
He had been in possession of the owners
duplicate of said title and had been in continuous,
open, adverse and peaceful possession of the property.
He died on February 9, 1970 and was survived by his
wife, Alicia Santos, and other plaintiffs, who were their
children. Thereafter, plaintiffs took peaceful and
adverse possession of the property, and of the owners
duplicate of said title. When the Office of the Register
of Deeds of Quezon City was burned on June 11, 1988,
the original copy of said title was burned as well.
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The Register of Deeds had the title
reconstituted based on the owners duplicate.
Sometime in February 1996, plaintiffs learned that
defendant was claiming ownership over the property
based on TCT No. 321744 issued on September 18,
1984 which, on its face, cancelled TCT No. 320898,
under the name of the Philippine National Bank, which
allegedly cancelled TCT No. 252070 in the names of
the spouses Marcos and Romana dela Cruz.
They insisted that TCT Nos. 321744, 320898 and
252070 were not among the titles issued by the
Register of Deeds of Quezon City and even if the
Register of Deeds issued said titles, it was contrary to
law.
As gleaned from the caption of the complaint,
plaintiffs appear to be the heirs of Enrique Santos,
represented by Enrique G. Santos. The latter signed
the Verification and Certificate of Non-Forum
Shopping.
Defendant asserted that the case involved
more than one plaintiff but the verification and
certification against forum shopping incorporated in
the complaint was signed only by Enrique Santos.
Although the complaint alleges that plaintiffs are
represented by Enrique Santos, there is no showing
that he was, indeed, authorized to so represent the
other plaintiffs to file the complaint and to sign the
verification and certification of non-forum shopping.
Thus, plaintiffs failed to comply with Section 5, Rule 7
of the Rules of Court. Defendant cited the ruling of this
Court in Loquias v. Office of the Ombudsman.
Defendant maintained that the complaint is
defective in that, although there is an allegation that
Enrique Santos represents the other heirs, there is
nothing in the pleading to show the latters authority to
that effect; the complaint fails to aver with
particularity the facts showing the capacity of
defendant corporation to sue and be sued; and the
pleading does not state the address of plaintiffs.
Defendant likewise averred that the complaint should
be dismissed on the ground of prescription.
In their comment, on the motion, plaintiffs
averred that the relationship of a co-owner to the
other co-owners is fiduciary in character; thus, anyone
of them could effectively act for another for the benefit
of the property without need for an authorization.
Consequently, Enrique Santos had the authority to
represent the other heirs as plaintiffs and to sign the
verification and certification against forum shopping.
In its reply, defendant averred that absent any
authority from his co-heirs, Enrique Santos must
implead them as plaintiffs as they are indispensable
parties. In response, plaintiffs aver that a co-owner of
a property can execute an action for quieting of title
without impleading the other co-owners.
The trial court issued an order, denying
defendants motion to dismiss. It declared that since
Enrique Santos was one of the heirs, his signature in
the verification and certification constitutes substantial
compliance with the Rules. The court cited the ruling of
this Court in Dar v. Alonzo-Legasto.
Petitioner averred that, of the plaintiffs below,
only plaintiff Enrique Santos signed the verification and
certification of non-forum shopping. Under Section 5,
Rule 7 of the 1997 Rules of Civil Procedure, all the
plaintiffs must sign, unless one of them is authorized
by a special power of attorney to sign for and in behalf
of the others. Petitioner argues that the bare claim of
Enrique Santos that he signed the verification and
certification in his behalf and of the other plaintiffs who
are his co-heirs/co-owners of the property does not
even constitute substantial compliance of the rule.
Contrary to the ruling of the trial court, the absence or
existence of an authority of Enrique Santos to sign the
verification and certification for and in behalf of his co-
plaintiffs is not a matter of evidence. The defect is fatal
to the complaint of respondents and cannot be cured
by an amendment of the complaint. The trial court
erred in applying the ruling of this Court in Dar v.
Alonzo-Legasto.
On April 7, 2005, the CA rendered the assailed
decision

dismissing the petition, holding that the RTC
did not commit grave abuse of its discretion amounting
to lack or excess of jurisdiction in denying petitioners
motion to dismiss. As the Court held in DAR v. Alonzo-
Legasto

and in Gudoy v. Guadalquiver,the certification
signed by one with respect to a property over which he
shares a common interest with the rest of the plaintiffs
(respondents herein) substantially complied with the
Rules. As to the issue of prescription, the appellate
court held that the prescriptive period should be
reckoned from 1996, when petitioner claimed
ownership and barred respondents from fencing the
property.

ISSUE: WHETHER OR NOT THE COURT OF APPEALS
ERRED IN RULING THAT THE CERTIFICATION OF NON-
FORUM SHOPPING SIGNED BY RESPONDENT ENRIQUE
G. SANTOS ALONE IS A SUBSTANTIAL COMPLIANCE
WITH SECTION 5, RULE 7 OF THE 1997 RULES OF
CIVIL PROCEDURE AND IN APPLYING THE CASE OF
GUDOY V. GUADALQUIVER, 429 SCRA 723, WITHOUT
REGARD TO MORE RECENT JURISPRUDENCE. NO.

RATIO: The issue in the present case is not the lack of
verification but the sufficiency of one executed by only
one of plaintiffs. This Court held in Ateneo de Naga
University v. Manalo, that the verification requirement
is deemed substantially complied with when, as in the
present case, only one of the heirs-plaintiffs, who has
sufficient knowledge and belief to swear to the truth of
the allegations in the petition (complaint), signed the
verification attached to it. Such verification is deemed
sufficient assurance that the matters alleged in the
petition have been made in good faith or are true and
correct, not merely speculative.
The same liberality should likewise be applied
to the certification against forum shopping. The
general rule is that the certification must be signed by
all plaintiffs in a case and the signature of only one of
them is insufficient. However, the Court has also
stressed in a number of cases that the rules on forum
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shopping were designed to promote and facilitate the
orderly administration of justice and thus should not
be interpreted with such absolute literalness as to
subvert its own ultimate and legitimate objective. The
rule of substantial compliance may be availed of with
respect to the contents of the certification. This is
because the requirement of strict compliance with the
provisions merely underscores its mandatory nature in
that the certification cannot be altogether dispensed
with or its requirements completely disregarded.
The substantial compliance rule has been
applied by this Court in a number of cases: Cavile v.
Heirs of Cavile,

where the Court sustained the validity
of the certification signed by only one of petitioners
because he is a relative of the other petitioners and co-
owner of the properties in dispute; Heirs of Agapito T.
Olarte v. Office of the President of the Philippines,

where the Court allowed a certification signed by only
two petitioners because the case involved a family
home in which all the petitioners shared a common
interest; Gudoy v. Guadalquiver,

where the Court
considered as valid the certification signed by only four
of the nine petitioners because all petitioners filed as
co-owners pro indiviso a complaint against
respondents for quieting of title and damages, as such,
they all have joint interest in the undivided whole;
and Dar v. Alonzo-Legasto,

where the Court sustained
the certification signed by only one of the spouses as
they were sued jointly involving a property in which
they had a common interest.
It is noteworthy that in all of the above cases,
the Court applied the rule on substantial compliance
because of the commonality of interest of all the
parties with respect to the subject of the controversy.
Applying the doctrines laid down in the above cases,
we find and so hold that the CA did not err in affirming
the application of the rule on substantial compliance.
In the instant case, the property involved is a 936-
square-meter real property. Both parties have their
respective TCTs over the property. Respondents herein
who are plaintiffs in the case below have a common
interest over the property being the heirs of the late
Enrique Santos, the alleged registered owner of the
subject property as shown in one of the TCTs. As such
heirs, they are considered co-owners pro indiviso of
the whole property since no specific portion yet has
been adjudicated to any of the heirs. Consequently, as
one of the heirs and principal party, the lone signature
of Enrique G. Santos in the verification and certification
is sufficient for the RTC to take cognizance of the case.
The commonality of their interest gave Enrique G.
Santos the authority to inform the RTC on behalf of the
other plaintiffs therein that they have not commenced
any action or claim involving the same issues in
another court or tribunal, and that there is no other
pending action or claim in another court or tribunal
involving the same issues. Hence, the RTC correctly
denied the motion to dismiss filed by petitioner.
Considering that at stake in the present case is
the ownership and possession over a prime property in
Quezon City, the apparent merit of the substantive
aspects of the case should be deemed as a special
circumstance or compelling reason to allow the
relaxation of the rule.
Time and again, this Court has held that rules
of procedure are established to secure substantial
justice. Being instruments for the speedy and efficient
administration of justice, they may be used to achieve
such end, not to derail it. In particular, when a strict
and literal application of the rules on non-forum
shopping and verification will result in a patent denial
of substantial justice, these may be liberally construed.

The ends of justice are better served when cases are
determined on the merits after all parties are given
full opportunity to ventilate their causes and defenses
rather than on technicality or some procedural
imperfections.


REPUBLIC v. SANDIGANBAYAN

FACTS: On December 17, 1991, petitioner Republic,
through the Presidential Commission on Good
Government (PCGG), represented by the Office of the
Solicitor General (OSG), filed a petition for forfeiture
against Marcos properties before the Sandiganbayan.
In said case, petitioner sought the declaration of the
aggregate amount of US$356 million (now estimated
to be more than US$658 million inclusive of interest)
deposited in escrow in the PNB, as ill-gotten wealth.
The funds were previously held by the following five
account groups, using various foreign foundations in
certain Swiss banks. In addition, the petition sought
the forfeiture of US$25 million and US$5 million in
treasury notes which exceeded the Marcos couple's
salaries, other lawful income as well as income from
legitimately acquired property.
A General Agreement and the Supplemental
Agreements dated December 28, 1993 were executed
by the Marcos children and then PCGG Chairman
Magtanggol Gunigundo for a global settlement of the
assets of the Marcos family. The agreements included
a stipulation that the US$356 million presumed to be
owned by the Marcoses under some conditions.
Respondent Mrs. Marcos filed a manifestation
on May 26, 1998 claiming she was not a party to the
motion for approval of the Compromise Agreement and
that she owned 90% of the funds with the remaining
10% belonging to the Marcos estate.
Republic prayed for a summary judgement
over the controversy which was opposed by
respondent marcos.
Sandiganbayan granted the prayer of
petitioner Republic and rendered a judgment in favour
of the latter, declaring the Swiss deposits which were
transferred to and now deposited in escrow at the
Philippine National Bank in the total aggregate value
equivalent to US$627,608,544.95 as of August 31,
2000 together with the increments thereof forfeited in
favor of the State. However, in 2002 and upon the
motion of Mrs. Araneta who adopted the motion for
reconsideration of the respondent Marcoses, the
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Sandiganbayan reversed its 2000 decision stating
there was no basis for the forfeiture because there was
no proof that the Marcoses owned the funds in escrow
from the Swiss Banks.

ISSUE: Whether or not respondents raised any
genuine issue of fact which would either justify or
negate summary judgment? - No. The Court held that
respondent Marcoses failed to raise any genuine issue
of fact in their pleadings. Thus, on motion of petitioner
Republic, summary judgment should take place as a
matter of right.

RATIO: In the early case of Auman vs. Estenzo,
summary judgment was described as a judgment
which a court may render before trial but after both
parties have pleaded. It is ordered by the court upon
application by one party, supported by affidavits,
depositions or other documents, with notice upon the
adverse party who may in turn file an opposition
supported also by affidavits, depositions or other
documents. This is after the court summarily hears
both parties with their respective proofs and finds that
there is no genuine issue between them. Summary
judgment is sanctioned in this jurisdiction by Section
1, Rule 35 of the 1997 Rules of Civil Procedure. The
theory of summary judgment is that, although an
answer may on its face appear to tender issues
requiring trial, if it is demonstrated by affidavits,
depositions or admissions that those issues are not
genuine but sham or fictitious, the Court is justified in
dispensing with the trial and rendering summary
judgment for petitioner Republic.
The pleadings filed by respondent Marcoses are
replete with indications of a spurious defense:
In their answer, respondents failed to
specifically deny each and every allegation contained
in the petition for forfeiture in the manner required by
the rules. All they gave were stock answers like "they
have no sufficient knowledge" or "they could not recall
because it happened a long time ago," and, as to Mrs.
Marcos, "the funds were lawfully acquired," without
stating the basis of such assertions.
Section 10, Rule 8 of the 1997 Rules of
Civil Procedure, provides:
A defendant must specify each material
allegation of fact the truth of which he
does not admit and, whenever practicable,
shall set forth the substance of the
matters upon which he relies to support
his denial. Where a defendant desires to
deny only a part of an averment, he shall
specify so much of it as is true and
material and shall deny the remainder.
Where a defendant is without knowledge
or information sufficient to form a belief
as to the truth of a material averment
made in the complaint, he shall so state,
and this shall have the effect of a denial.
The purpose of requiring respondents to make
a specific denial is to make them disclose facts which
will disprove the allegations of petitioner at the trial,
together with the matters they rely upon in support of
such denial. Our jurisdiction adheres to this rule to
avoid and prevent unnecessary expenses and waste of
time by compelling both parties to lay their cards on
the table, thus reducing the controversy to its true
terms.
On the part of Mrs. Marcos, she claimed that
the funds were lawfully acquired. However, she failed
to particularly state the ultimate facts surrounding the
lawful manner or mode of acquisition of the subject
funds.
Despite the serious and specific allegations
against them, the Marcoses responded by simply
saying that they had no knowledge or information
sufficient to form a belief as to the truth of such
allegations. Such a general, self-serving claim of
ignorance of the facts alleged in the petition for
forfeiture was insufficient to raise an issue. Respondent
Marcoses should have positively stated how it was that
they were supposedly ignorant of the facts alleged.
Example of the allegations that were not
specifically denied: The Marcoses used
dummies/nominees, fronts or agents who formed
those foundations or corporate entities, they opened
and maintained numerous bank accounts to amass the
$356M and hide it. The Marcoses just replied that the
said amount was lawfully acquired or they had no
knowledge of such facts.
Evidently, this particular denial had the
earmark of what is called in the law on pleadings as a
negative pregnant, that is, a denial pregnant with the
admission of the substantial facts in the pleading
responded to which are not squarely denied. It was in
effect an admission of the averments it was directed
at. Stated otherwise, a negative pregnant is a form of
negative expression which carries with it an affirmation
or at least an implication of some kind favorable to the
adverse party. It is a denial pregnant with an
admission of the substantial facts alleged in the
pleading. Where a fact is alleged with qualifying or
modifying language and the words of the allegation as
so qualified or modified are literally denied, has been
held that the qualifying circumstances alone are denied
while the fact itself is admitted.
Respondents' answer was thus a denial
pregnant with admissions of the following substantial
facts: (1) the Swiss bank deposits existed and (2) that
the estimated sum thereof was US$356 million as of
December, 1990.
Therefore, the allegations in the petition for
forfeiture on the existence of the Swiss bank deposits
in the sum of about US$356 million, not having been
specifically denied by respondents in their answer,
were deemed admitted by them pursuant to Section
11, Rule 8 of the 1997 Revised Rules on Civil
Procedure.
Their claim of lack of knowledge of several
matters, transactions and documents was also
disproved (regarding the foundations and the money).
The Marcoses had their signatures on some of the
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documents that proved the transactions in issue
proving that they indeed had knowledge thereof.
When matters regarding which respondents
claim to have no knowledge or information sufficient to
form a belief are plainly and necessarily within their
knowledge, their alleged ignorance or lack of
information will not be considered a specific denial. An
unexplained denial of information within the control of
the pleader, or is readily accessible to him, is evasive
and is insufficient to constitute an effective denial.
Furthermore, the heirs of FM are bound by the general
denial/admissions made by FM thus the children
cannot claim also claim lack of knowledge.
It is settled that judicial admissions may be
made: (a) in the pleadings filed by the parties; (b)
in the course of the trial either by verbal or written
manifestations or stipulations; or (c) in other stages of
judicial proceedings, as in the pre-trial of the case.

Thus, facts pleaded in the petition and answer, as in
the case at bar, are deemed admissions of petitioner
and respondents, respectively, who are not permitted
to contradict them or subsequently take a position
contrary to or inconsistent with such admissions.
Moreover, the opposition filed by Mrs. Marcos
to the motion for summary judgment dated March 21,
2000 of petitioner Republic was merely adopted by the
Marcos children as their own opposition to the said
motion. However, it was again not accompanied by
affidavits, depositions or admissions as required by
Section 3, Rule 35 of the 1997 Rules on Civil
Procedure.
The absence of opposing affidavits, depositions
and admissions to contradict the sworn declarations in
the Republic's motion only demonstrated that the
averments of such opposition were not genuine and
therefore unworthy of belief.
In the Compromise/Supplemental Agreements,
respondent Marcoses sought to implement the agreed
distribution of the Marcos assets, including the Swiss
deposits. This was, to the Court, an unequivocal
admission of ownership by the Marcoses of the said
deposits.

Summary:
Mere denials, if unaccompanied by any fact which will
be admissible in evidence at a hearing, are not
sufficient to raise genuine issues of fact and will not
defeat a motion for summary judgment. A summary
judgment is one granted upon motion of a party for an
expeditious settlement of the case, it appearing from
the pleadings, depositions, admissions and affidavits
that there are no important questions or issues of fact
posed and, therefore, the movant is entitled to a
judgment as a matter of law. A motion for summary
judgment is premised on the assumption that the
issues presented need not be tried either because
these are patently devoid of substance or that there is
no genuine issue as to any pertinent fact. It is a
method sanctioned by the Rules of Court for the
prompt disposition of a civil action where there exists
no serious controversy. Summary judgment is a
procedural device for the prompt disposition of actions
in which the pleadings raise only a legal issue, not a
genuine issue as to any material fact. The theory of
summary judgment is that, although an answer may
on its face appear to tender issues requiring trial, if it
is established by affidavits, depositions or admissions
that those issues are not genuine but fictitious, the
Court is justified in dispensing with the trial and
rendering summary judgment for petitioner.


JUABAN v. ESPINA

FACTS This stemmed from 3 interlinked cases.
Heirs of Bancale sued for the recovery of certain
properties against Eva Paras and others (Case No. 1).
Petitioners Juaban and Zosa were their counsels. The
heirs then entered into an Agreemenet to Sell and to
Buy with respondent Espina, where they agreed to sell
the subject property to respondent or his assignee with
the amount of P2M as advance payment on the
purchase price. Espina duly paid the said amount. He
then designated respondent Cebu Bay Discovery
Properties, Inc. (CDPI) as the vendee. Subsequently,
respondents found out that Juaban and Zosa had filed
a motion to fix their attorneys fees which was granted
and fixed by the RTC at P9M. The heirs moved for
reconsideration but were denied. They filed a Notice of
Appeal which was indirectly overruled when the court
granted the motion for execution filed by petitioners. A
writ of execution was then issued followed by the sale
of the subject properties to petitioners for P9M, despite
the express instruction of the writ that the attorneys
fees were to be taken from the money due from the
buyer to the sellers under the agreement.
However, the RTC, under a new presiding
judge, reversed and granted the MR of the heirs.
Meanwhile, petitioners were able to obtain a final deed
of sale from Sheriff Gato on the ground that no
redemption of the subject properties was made (Thus,
an administrative complaint against the sheriff was
filed for allegedly acting with manifest bias and
partiality [Case No. 2]).
Respondents also filed an injunction and
damages case to enjoin the sale in a public auction by
Sheriff Gato, allegedly unaware, at the time of the
filing of said case, that the properties had already been
sold (Case No. 3). The court granted petitioners
Motion to Dismiss.
On appeal, CA reversed and ordered the writ of
preliminary injunction to be made permanent.

RELEVANT ISSUEs
1. Whether respondent Espina has authority to
file the case. YES
2. Whether the certificate of non-forum shopping
is invalid given that it was only signed by one
of the plaintiffs, i.e. respondent Espina. (Ergo,
whether the complaint should be dismissed
due to non-compliance with the requirements
of the Rules.) NO & NO!
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RULING: Petitioners claimed that the complaint should
have been dismissed because Espina no longer had
personal interest in the case as he had assigned his
rights to CDPI and that he was not authorized to file on
behalf of CDPI. However, citing Rule 3 Sec. 2 of the
ROC, SC ruled that Espina is a real party in interest
8
in
this case. Thus, respondents right to the properties is
based on the Agreement to Sell and to Buy executed
between the heirs and respondent Espina. The said
Agreement is the very source of the right, the violation
of which constituted the cause of action in
respondents complaint for injunction before the court
a quo. It was respondent Espina who entered into the
Agreement, and his rights as a party to the said
contract were not extinguished just because he
designated his co-respondent CDPI as vendee of
the subject properties.
Having been established as a real party in
interest, respondent Espina has not only the
personality to file the complaint in the third case,
but also the authority to sign the certification
against forum shopping as a plaintiff therein.
Citing several cases, SC held that the
certification against forum shopping must be signed by
the plaintiff or any of the principal parties and not
by counsel.
The general rule is that the certificate must be
signed by all the plaintiffs or petitioners in a case and
the signature of only one of them is insufficient.
Nevertheless, the rules on forum shopping, which were
designed to promote and facilitate the orderly
administration of justice, should not be interpreted
with such absolute literalness as to subvert their own
ultimate and legitimate objective. Strict compliance
with the provisions regarding the certificate of non-
forum shopping merely underscores its mandatory
nature in that the certification cannot be altogether
dispensed with or its requirements completely
disregarded.
Thus, when all the petitioners share a
common interest and invoke a common cause of
action or defense, the signature of only one of
them in the certification against forum shopping
substantially complies with the rules.
Thus, the certificate against forum shopping is
not rendered invalid by the absence of the signature of
an authorized official of respondent CDPI. The
signature of respondent Espina as one of the plaintiffs
therein suffices.


KOREAN TECHNOLOGIES v. ALBERTO LERMA


8
A real party in interest is the party who stands to be
benefited or injured by the judgment in the suit, or the party
entitled to the avails of the suit. Unless otherwise authorized
by law or these Rules, every action must be prosecuted or
defended in the name of the real
party in interest.
FACTS Korea Technologies Co., Ltd. (KOGIES) is a
Korean corporation which is engaged in the supply and
installation of Liquefied Petroleum Gas (LPG) Cylinder
manufacturing plants, while Pacific General Steel
Manufacturing Corp. (PGSMC) is a domestic
corporation.
PGSMC and KOGIES executed a contract in the
Philippines whereby KOGIES would set up an LPG
Cylinder Manufacturing Plant in Carmona, Cavite. In
Korea, the parties executed an Amendment to the
contract regarding the terms of payment.
However, after the installation of the plant, the
initial operation could not be conducted as PGSMC
encountered financial difficulties affecting the supply of
materials, thus forcing the parties to agree that
KOGIES would be deemed to have completely complied
with the terms and conditions of the contract.
For the remaining balance aimed at the
installation and initial operation of the plant, PGSMC
issued two post-dated checks. When KOGIES
deposited the checks, these were dishonoured for the
reason "PAYMENT STOPPED." Thus, KOGIES sent a
demand letter to PGSMC threatening criminal action for
violation of Batas Pambansa Blg. 22 in case of non-
payment.
PGSMC informed KOGIES that PGSMC was
cancelling their Contract on the ground that KOGIES
had altered the quantity and lowered the quality of the
machineries and equipment it delivered to PGSMC, and
that PGSMC would dismantle and transfer the
machineries, equipment, and facilities installed in the
Carmona plant. Five days later, PGSMC filed before the
Office of the Public Prosecutor an Affidavit-Complaint
for Estafa docketed against the President of KOGIES.
KOGIES filed a Complaint for Specific
Performance, against PGSMC before the Muntinlupa
City Regional Trial Court (RTC). In its complaint,
KOGIES alleged that PGSMC had initially admitted that
the checks that were stopped were not funded but
later on claimed that it stopped payment of the checks
for the reason that "their value was not received" as
the former allegedly breached their contract by
"altering the quantity and lowering the quality of the
machinery and equipment" installed in the plant and
failed to make the plant operational although it earlier
certified to the contrary.
PGSMC filed its Answer with Compulsory
Counterclaim

asserting that it had the full right to
dismantle and transfer the machineries and equipment
because it had paid for them in full as stipulated in the
contract, that KOGIES was not entitled to the balance
covered by the checks for failing to completely install
and make the plant operational, and that KOGIES was
liable for damages for altering the quantity and
lowering the quality of the machineries and equipment.

ISSUE Whether the payment of docket fees and
attachment of certificate of non-forum shopping are
not required considering that the Answer with
Counterclaim is a compulsory one and is not an
initiatory pleading?
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RULING and RATIO: As aptly ruled by the CA, the
counterclaims of PGSMC were incorporated in its
Answer with Compulsory Counterclaim in accordance
with Section 8 of Rule 11, 1997 Revised Rules of Civil
Procedure, the rule that was effective at the time the
Answer with Counterclaim was filed.
On July 17, 1998, at the time PGSMC filed its
Answer incorporating its counterclaims against
KOGIES, it was not liable to pay filing fees for said
counterclaims being compulsory in nature. We stress,
however, that effective August 16, 2004 under Sec. 7,
Rule 141, as amended by A.M. No. 04-2-04-SC, docket
fees are now required to be paid in compulsory
counterclaim or cross- claims.
As to the failure to submit a certificate of
forum shopping, PGSMCs Answer is not an initiatory
pleading which requires a certification against forum
shopping under Sec. 5 of Rule 7, 1997 Revised Rules
of Civil Procedure. It is a responsive pleading, hence,
the courts a quo did not commit reversible error in
denying KOGIES motion to dismiss PGSMCs
compulsory counterclaims.


FILIPINAS TEXTILE v. CA

FACTS: Filipinas Textile Mills, Inc. (Filtex) applied and
was issued letters of credit by State Investment
House, Inc. (SIHI) for the purchase of various textile
materials from its suppliers. The suppliers issued
several sight drafts payable to the order of SIHI, which
were duly accepted by Filtex. The sight drafts were
negotiated to and acquired in due course by SIHI
which paid the value thereof to the suppliers for the
account of Filtex. On behalf of Filtex, Bernardino
Villanueva executed a comprehensive surety
agreement whereby he guaranteed, jointly and
severally with Filtex, the full and punctual payment of
Filtexs indebtedness. To ensure the payment of the
sight drafts, Filtex issued to SIHI several trust receipts
and replacement trust receipts whereby Filtex agreed
to hold the merchandise in trust for SIHI, with liberty
to sell the same for SIHIs account but without
authority to make any other disposition of the said
goods. Filtex failed to pay. SIHI filed a Complaint for
Collection.
Petitioners argued that the comprehensive
surety agreement and the trust receipts upon which
the Complaint was based was null and void for lack of
consent; that SIHI materially altered the terms and
conditions of the surety agreement; and that the
obligation was fully paid with overpayment. However,
petitioners failed to specifically deny under oath the
genuineness and due execution of said documents in
their respective Answers. On Appeal, petitioners
claimed that the documents were inadmissible in
evidence due to the non-payment of documentary
stamp taxes as required by the NIRC.
SIHI contended that the petitioners expressly
admitted the due execution of the documents in their
respective Answers, thus, they could no longer
question their admissibility; that their allegation of
inadmissibility is inconsistent with their defense of full
payment; and that assuming the DST is required, it is
for the sole account of Filtex not only because the
letters of credit were issued at its instance and
application but also because it was the issuer and
acceptor of the trust receipts and sight drafts,
respectively.
The RTC held that Filtex and Villanueva are
jointly and severally liable to SIHI. The CA held that
the petitioners admitted the genuineness and due
execution of said documents because of their failure to
have their answers placed under oath, the complaint
being based on actionable documents in line with
Section 7, Rule 8 of the Rules of Court. MR Denied.

ISSUE: Whether or not the petitioners admitted the
genuineness and due execution of said documents
because of their failure to specifically deny under oath
the genuineness and due execution of the documents
in their respective Answers? YES.

RATIO: The Answer with Counterclaim and Answer of
Filtex and Villanueva, respectively, did not contain any
specific denial under oath of the letters of credit, sight
drafts, trust receipts and comprehensive surety
agreement, thus giving rise to the implied admission of
the genuineness and due execution of these
documents. Under Sec. 8, Rule 8 of the Rules of Court,
when an action or defense is founded upon a written
instrument, copied in or attached to the corresponding
pleading as provided in the preceding section, the
genuineness and due execution of the instrument shall
be deemed admitted unless the adverse party, under
oath, specifically denies them, and sets forth what he
claims to be the facts.
The genuineness and due execution of a
document means that the party whose signature it
bears admits that he voluntarily signed the document
or it was signed by another for him and with his
authority; that at the time it was signed it was in
words and figures exactly as set out in the pleading of
the party relying upon it; that the document was
delivered; and that any formalities required by law,
such as a seal, an acknowledgment, or revenue stamp,
which it lacks, are waived by him.
The petitioners are also estopped from
claiming that the documents are inadmissible in
evidence for non-payment of the DST because Filtex
applied for the LOC and it was the issuer and acceptor
of the trust receipts and sight drafts, and Villanueva
signed the comprehensive surety agreement on behalf
of Filtex. Further, they questioned the admissibility of
these documents rather belatedly, at the appeal stage
even. The rule is well-settled that points of law,
theories, issues and arguments not adequately brought
to the attention of the trial court need not, and
ordinarily will not, be considered by a reviewing court
as they cannot be raised for the first time on appeal
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because this would be offensive to the basic rules of
fair play, justice and due process.
The contention that the petitioners have fully
paid their obligation is purely a factual issue. The
jurisdiction of this Court in cases brought before it
from the Court of Appeals under Rule 45 of the Rules
of Court is limited to reviewing or revising errors of
law.
The contention that the comprehensive surety
agreement is null and void for lack of consent of Filtex
and SIHI is specious. The consent of Filtex to the
surety may be assumed from the fact that Villanueva
was the signatory to the sight drafts and trust receipts
on behalf of Filtex. SIHIs consent to the surety is also
understood from the fact that it demanded payment
from both Filtex and Villanueva.
As regards the purported material alteration of
the terms and conditions of the comprehensive surety
agreement by granting Filtex an extension of the
period for payment thereby releasing Villanueva from
his obligation as surety, we rule that the extension did
not release Villanueva from his liability. The neglect of
the creditor to sue the principal at the time the debt
falls due does not discharge the surety, even if such
delay continues until the principal becomes insolvent.
There is nothing to prevent the creditor from
proceeding against the principal at any time. At any
rate, if the surety is dissatisfied with the degree of
activity displayed by the creditor in the pursuit of his
principal, he may pay the debt himself and become
subrogated to all the rights and remedies of the
creditor.


SY TIONG v. SY CHIM

FACTS: [*this is a consolidated case, the facts in G.R.
No. 179438 is the one relevant to Rem]

FACTS: The corporation Sy Siy Ho & Sons filed a
criminal case for robbery against the Sps. Sy [ Sy
Chim and Felicidad Chan Sy] after failing to respond to
the demand letter for accounting of misappropriated
money. It was alleged and found that they failed to
make cash de deposits to any of the corporations
banks hence the total bank remittances for the past
years were less than that reflected in the corporate
financial statements. They have P67, 117, 230.30 as
unaccounted receipts and disbursements. Also, after a
demand letter was sent to them, they stopped
reporting to the company.
Sy Tiong, the Corporate VP called for a special
meeting where he was elected president and his wife
Juanita the new VP. The corporation filed an amended
complaint for accounting and damages against the
Sps. Sy for complete and true accounting of all
amounts misappropriated. The Sps Sy answered that
the meeting was without authority and that they were
the ones authorized by the by-laws to control and
administer the corporation. They also filed their
counter-claim for moral and exemplary damages.
They later filed a Motion for Leave to file a
third-party complaint against Sy Tiong and Juanita
alleging that the latter are the ones directly liable for
misappropriation. The RTC granted, the CA however
reversed stating a third-party complaint is not allowed
under the Interim Rules of Procedure governing Intra-
Corporate Controversies as it is not included in the
exclusive enumeration of the allowed pleadings.

ISSUE: W/N a third party complaint is allowed. YES.

RATIO: The conflict arose because, for while a third-
party complaint is not included in the allowed
pleadings, it is also not among the prohibited
pleadings. This can be resolved by following the well-
entrenched rule in statutory construction that every
part of the statute must be interpreted with reference
to the context, that it be construed in light of the
object to be achieved. Looking at Sec. 3 Rule 1 of the
Interim Rules, the spirit and intent of the law can be
gleamed to be the securing of a just, speedy and
inexpensive determination of an action.
The summary nature of the interim rules and
the allowance of filing of a third-party complaint is
premised on one objective the expeditious
disposition of cases. A third party complaint is a claim
that a defending party, may, with leave of court, file
against a person to the action called the third party
defendant, for contribution, indemnity, subrogation or
any other relief. Had it not been for Rule 6, Sec. 11 of
RoC, the third party complaint would have been filed
independently and separately from the original
complaint. Allowing third party complaint avoids
circuitry of actions and unnecessary proliferation of law
suits and results to expeditious disposition in one
litigation all matters arising from one particular set of
facts.
The brining of a third-party complaint is proper
if he would be liable to the plaintiff or the defendant or
both for all part of the plaintiffs claim against the
original defendant, although the third-party
defendants liability arises out of another transaction.
The defendant may implead another as third-party
defendant: (a) on allegation of liability of the latter to
the defendant for contribution, indemnity, subrogation
or any other relief; (b) on ground of direct liability of
the third-party defendant to the plaintiff; or (c) the
liability of the third-party defendant to both plaintiff
and the defendant.
In determining sufficiency of the third party
complaint, the allegations in the original complaint and
the third-party complaint must be examined. The
third-party complaint must allege facts which prima
facie shows that the defendant is entitled to
contribution, indemnity, subrogation or other relief.
In the case at bar, the complaint attributes to
the Sps Sy liability to render full and complete
accounting of amounts misappropriated. The third
party complaint alleges that it is Sy Tiong and Juanita
who should be liable. The allegations in the third-party
complaint impute direct liability to Sy Tiong for the
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very same claims the corporation interposed against
Sps Sy. The third party complaint is in respect of the
corporations thus should be allowed.


PTA OF ST. MATTHEWS ACADEMY v. METROBANK

FACTS: Spouses Ilagan obtained a loan from
Metrobank in the amount of P4,790,000.00, secured
by a Real Estate Mortgage over parcels of land covered
by various TCTs. Upon default of the spouses,
Metrobank extrajudicially foreclosed the properties, for
which a certificate of sale was issued in its favor as the
highest bidder. During the period of redemption,
Metrobank filed an Ex-Parte Petition for Issuance of a
Writ of Possession docketed as LRC Case No. 6438.
Thereafter, St. Matthew Christian Academy of Tarlac,
Inc. filed a Petition for Injunction with Prayer for
Restraining Order against Metrobank, docketed as
Special Civil Action No. 9793.
The judge issued a joint decision for LRC Case
No. 6438 and Special Civil Action No. 9793, ruling that
Metrobank is entitled to a writ of possession. Pending
resolution of the motion for reconsideration, petitioners
PTA of St. Matthew Academy and other teachers and
students of the said school filed a Motion for Leave to
file Petition in Intervention in Special Civil Action No.
9793, which was granted by the trial court. However, it
reversed its earlier ruling via a subsequent order
stating that petitioners intervention would have no
bearing on the issuance and implementation of the writ
of possession. Without filing a motion for
reconsideration, petitioners filed a Petition for
Certiorari and Prohibition before the CA. The CA
dismissed the same. Hence, this petition, where
among others, petitioners claim that the Metrobank
Branch Head lacked the authority to sign the certificate
of non-forum shopping attached to the Petition for the
Issuance of the Writ of Possession.

ISSUE Whether or not the Metrobank Branch Heads
lack of authority to sign the certificate of non-forum
shopping was fatal.

RULING and RATIO:
No, lack of authority to sign the certificate of non-
forum shopping was not fatal to Metrobank since such
certificate is only needed when filing an initiatory
pleading. This case does not involve an initiatory
pleading. Although the Petition for the Issuance of a
Writ of Possession was captioned as a Petition, the
same is to be considered merely a motion. What
distinguishes a motion from a petition or other
pleading is not its form or the title given by the party
executing it, but its purpose. The purpose of a motion
is not to initiate litigation, but to bring up a matter
arising in the progress of the case where the motion is
filed.
It is not necessary to initiate an original action
in order for the purchaser at an extrajudicial
foreclosure of real property to acquire possession.
Hence, it is immaterial that the certification on non-
forum shopping in the MBTCs petition was signed by
its branch head. Such inconsequential oversight did
not render the said petition defective in form.


PERMANENT SAVINGS BANK v. VELARDE

FACTS: Mariano Velarde obtained a loan amounting to
P1,000,000.00 from Permanent Savings and Loan
Bank (The Bank). The Bank already sent 2 demand
letters to Velarde, however, the latter still failed to
settle his loan obligation. Thus, the Bank filed a
complaint for sum of money for the recovery of the
amount of the loan plus interests and penalties before
the RTC of Manila.
The loan was evidenced by a promissory note,
a loan release sheet and a loan disclosure statement.
In his Answer, Velarde stated that the signature
appearing at the back of the promissory note seems to
be his. However, he denied having received the
proceeds of the loan. He likewise claimed that the
documents relative to the loan do not express the true
intention of the parties.
After the Bank rested its case, Velarde, instead
of presenting evidence, filed a demurrer to evidence
based on the following grounds:
1. Plaintiff failed to prove its case by
preponderance of evidence.
2. The cause of action is barred by prescription.
The Trial Court found merit in Velardes
demurer to evidence and dismissed the Banks
complaint. It ruled that mere presentation of the
documents evidencing the loan without a testimony of
a competent witness to the transaction and the
documents, coupled with the denial of liability by
Velarde does not suffice to meet the requisite
preponderance of evidence in civil cases. On appeal,
the CA affirmed the dismissal.

ISSUE: Whether or not there is a need for the Bank to
present further evidence as to the due execution and
authenticity of the loan documents.

RULING and RATIO:
No, there is no need for the Bank to present further
evidence as to the due execution and authenticity of
the loan documents because Velarde, in his Answer,
did not specifically deny that he signed the promissory
note. What he merely stated in his Answer was that
the signature appearing at the back of the promissory
note seems to be his. Velarde also denied any liability
on the promissory note as he allegedly did not receive
the amount stated therein, and that the loan
documents do not express the true intention of the
parties. These denials, according to the Court, do
not constitute an effective specific denial as
contemplated by law. In fact, respondents
allegations amount to an implied admission of
the due execution and genuineness of the
promissory note. The admission of the genuineness
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and due execution of a document means that the party
whose signature it bears admits that he voluntarily
signed the document or it was signed by another for
him and with his authority; that at the time it was
signed it was in words and figures exactly as set out in
the pleading of the party relying upon it; that the
document was delivered; and that any formalities
required by law, such as a seal, an acknowledgment,
or revenue stamp, which it lacks, are waived by
him. Also, it effectively eliminated any defense relating
to the authenticity and due execution of the
document, e.g., that the document was spurious,
counterfeit, or of different import on its face as the one
executed by the parties; or that the signatures
appearing thereon were forgeries; or that the
signatures were unauthorized.
Clearly, both the trial court and the Court of
Appeals erred in concluding that Velarde specifically
denied the Banks allegations regarding the loan
documents, as Velardes Answer shows that he failed
to specifically deny under oath the genuineness and
due execution of the promissory note and its
concomitant documents. Therefore, he is deemed
to have admitted the loan documents and
acknowledged his obligation with the Bank; and
with his implied admission, it was not necessary
for the Bank to present further evidence to
establish the due execution and authenticity of
the loan documents sued upon.
While Section 22, Rule 132 of the Rules of
Court requires that private documents be proved of
their due execution and authenticity before they can
be received in evidence, i.e., presentation and
examination of witnesses to testify on this fact; in the
present case, there is no need for proof of execution
and authenticity with respect to the loan documents
because of Velardes implied admission thereof.

DEFAULT

ANUNCACION v. BOCANEGRA

FACTS: 9/29/2000 Anunciacion filed a complaint for
Quieting of Title and Cancellation of Title. The
complaint averred that Bocanegra may be served with
summons and legal processes through Atty. Rogelio G.
Pizarro, Jr. The summons, together with the copies of
the complaint, were then served on Atty. Pizarro. The
record shows that before the filing of the said
complaint, Atty. Pizarro wrote a demand letter on
behalf of respondents and addressed to Anunciacion,
demanding that they vacate the land owned by
Bocanegra.
10/27/2000 - Bocanegra filed a Motion to
Dismiss (MTD) on the ground that the complaint stated
no cause of action. Petitioners filed their Comment on
the MTD.
11/13/2000 Bocanegra files a Supplemental
Motion to Dismiss and Reply to the Comment on the
MTD, alleging an additional ground that petitioners
failed to pay the required filing fee.
11/27/2000 Anunciacion filed their
Opposition to the Supplemental MTD and Comment to
the Reply to the Comment on the MTD
11/27/2000 Bocanegra filed a Second
Supplemental MTD and Manifestation citing the
following grounds:
1.) That the court has no jurisdiction over the
person of the defending party.
2.) That the court has no jurisdiction over the
subject matter of the claim.
3.) That the pleading asserting the claim states no
cause of action.
Anunciacion filed their Additional Comment on
the MTD, Supplemental MTD and Comment on the
Second Supplemental MTD
2/19/2001 RTC dismissed the complaint for
lack of jurisdiction over the persons of respondents as
defendants. MR was denied.
Anunciacion filed before the CA a Petition for
Certiorari, which the CA dismissed upon finding that
there was no waiver of the ground of lack of
jurisdiction on the part of respondents in the form of
voluntary appearance. Applying Section 20, Rule 14,
the CA held that although the grounds alleged in the 2
earlier Motion to Dismiss and Supplemental Motion to
Dismiss were lack of cause of action and failure to pay
the required filing fee, the filing of the said motions did
not constitute a waiver of the ground of lack of
jurisdiction on their persons as defendants. The CA
concluded that there was no voluntary appearance on
the part of respondents/defendants despite the filing of
the aforesaid motions. MR was denied.
Anunciacion filed a Petition for Review on
Certiorari before the Supreme Court

ISSUE AND RULING: W/N the filings of the MTD and
the Supplemental MTD by Bocanegra amounted to
voluntary appearance before the RTC Yes, case was
reinstated and remanded for further proceedings
(dismissal by the RTC was erroneous)

RATIO: Bocanegra filed a MTD dated 10/25/2000 with
only one ground (that the pleading asserting the claim
"states no cause of action"). Under this ground,
respondents raised the issues that the defendants
anchored their complaint on a WRONG Decree of
Registration; that the Government recognized the
authenticity of the land title; and that the Plaintiffs do
NOT have the legal personality to 'quiet the title' of the
subject property.
Section 20, Rule 14 states that the
defendant's voluntary appearance in the action shall be
equivalent to service of summons. The inclusion in a
MTD of other grounds aside from lack of jurisdiction
over the person of the defendant shall not be deemed
a voluntary appearance.
The filing of the 10/25/2000 MTD, without
invoking the lack of jurisdiction over the person of the
respondents, is deemed a voluntary appearance on the
part of the respondents under Sec. 20, Rule 14. The
same conclusion can be drawn from the filing of the
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10/13/2000 Supplemental MTD and Reply to the
Comment on the Motion to Dismiss which alleged, as
an additional ground for the dismissal of petitioners'
complaint, the failure of plaintiffs to pay the required
filing fee again but failed to raise the alleged lack of
jurisdiction of the court over the person of the
respondents. It was only in respondents' Second
Supplemental MTD (11/27/2000) that respondents for
the first time raised the court's lack of jurisdiction over
their person as defendants on the ground that
summons were allegedly not properly served upon
them. The Second Supplemental MTD did not divest
the court of its jurisdiction over the person of the
respondents who had earlier voluntarily appeared
before the trial court by filing their MTD and the
supplemental MTD. The dismissal of the complaint on
the ground of lack of jurisdiction over the person of the
respondents after they had voluntarily appeared before
the trial court clearly constitutes grave abuse of
discretion amounting to lack of jurisdiction or in excess
of jurisdiction on the part of the RTC.

Other REM issues:
1. Respondents' Supplemental MTD and Second
Supplemental MTD were in violation of Rule 15, Sec. 8
(Omnibus Motion) in relation to Rule 9, Sec. 1
(Defenses and objections not pleaded are deemed
waived; exceptions lack of jurisdiction over the subject
matter, existence of another action pending between
the same parties for the same cause; the action is
barred by prior judgment or by statute of limitations
court shall dismiss claim). Respondents' failure to raise
the alleged lack of jurisdiction over their persons in
their very first motion to dismiss was fatal to their
cause. They are already deemed to have waived that
particular ground for dismissal of the complaint.
Entertaining supplemental MTD which raise grounds
that are already deemed waived would encourage
lawyers and litigants to file piecemeal objections to a
complaint in order to delay or frustrate the prosecution
of the plaintiff's cause of action.

2. Although the CA correctly observed that Atty.
Pizarro, as the lawyer of the respondents in the
demand letters, does not per se make him their
representative for purposes of the present action, a
scrutiny of the record shows that the address of Atty.
Pizarro and Atty. Norby Caparas, Jr., (the counsel who
eventually entered his appearance for respondents) is
the same. This circumstance leads us to believe that
respondents' belated reliance on the purported
improper service of summons is a mere afterthought, if
not a bad faith ploy to avoid answering the complaint.
In another case, the SC held that a case should not be
dismissed simply because an original summons was
wrongfully served since an alias summons can be
actually served on the defendant. To be sure, a trial
court should be cautious before dismissing complaints
on the sole ground of improper service of summons
considering that it is well within its discretion to order
the issuance and service of alias summons on the
correct person in the interest of substantial justice.


MARTINEZ v. REPUBLIC

FACTS: On 24 February 1999 Martinez filed a petition
for the registration in his name of 3 parcels of land
included in the Cortes, Surigao del Sur Cadastre. He
alleged that he had purchased the lots in 1952 from
his uncle, whose predecessors-in-interest were
traceable up to the 1870s. It was claimed that he had
remained in continuous possession of the lots; that the
lots had remained unencumbered; and that they
became private property through prescription pursuant
to Sec. 48(b) of CA 141. He further claimed that he
had been constrained to initiate the proceedings
because the Director of the Land Management Services
had failed to do so despite the completion of the
cadastral survey of Cortes, Surigao del Sur.
The case was docketed and raffled to the RTC of
Surigao del Sur, Br.27. On 30 September 1999, the
OSG, in behalf of the Republic, opposed the petition on
the grounds that appellee's possession was not in
accordance with CA 141; that his muniments of title
were insufficient to prove bona-fide acquisition and
possession of the subject parcels; and that the
properties formed part of the public domain and thus
not susceptible to private appropriation.
Despite the opposition filed by the OSG, the RTC
issued an order of general default, even against the
Republic on 29 March 2000 because during the hearing
on the said date, no party opposed Martinezs petition.
On 1 August 2000, the RTC rendered a Decision
concluding that Martinez and his predecessors-in-
interest had proved the required possession under CA
141 and thus decreed the registration.
On 10 October 2003, the CA reversed the
decision of the trial court. No MR was filed by Martinez
instead, it filed the present Petition for Review with
the Supreme Court.

ISSUE: Whether an order of general default issued by
a trial court in a land registration case bars the
Republic, through the OSG, from interposing an appeal
from the trial courts subsequent decision in favor of
the applicant. NO.

RATIO: The SC decision is based on the argument of
the OSG that the default order was proper or regular.
9


9
Note that under Sec. 26 of PD 1529 (Property Registration
Decree), the order of default may be issued "if no person
appears and answers within the time allowed." The RTC
appears to have issued the order of general default simply on
the premise that no oppositor appeared before it on the
hearing of 29 March 2000. But it cannot be denied that the
OSG had already duly filed its Opposition to Martinez's
petition long before the said hearing. However, despite the
improper default order by the RTC, the OSG did not challenge
its propriety. Thus, the SC refrained from making a
pronouncement on it since it has not been put into issue.
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The juridical utility of a declaration of default cannot be
disputed. By foregoing the need for adversarial
proceedings, it affords the opportunity for the speedy
resolution of cases even as it penalizes parties who fail
to give regard or obedience to the judicial processes.
Before the 1997 Rules of Civil Procedure, the rule was
that a defaulted defendant cannot adduce evidence;
nor can he be heard at the final hearing, although he
may appeal the judgment rendered against him on the
merits, even without seeking to set aside the order of
default.
10

Under the new Rules, the prior warrant that a
defaulted defendant had the right to appeal was
removed from Sec.2 of Rule 41. On the other hand,
Sec.3 of Rule 9 incorporated the effects of the parties
of an order of default. It cannot be escaped that the
old provision expressly guaranteeing the right of a
defendant declared in default to appeal the adverse
decision was not replicated in the 1997 Rules of Civil
Procedure. Should this be taken as a sign that under
the 1997 Rules a defaulted defendant no longer has
the right to appeal the trial court decision?
If post - 1997 jurisprudence and the published
commentaries to the 1997 Rules were taken as an
indication, the answer should be in the negative. The
right of a defaulted defendant to appeal remains
extant.
By 1997, the doctrinal rule concerning the
remedies of a party declared in default had evolved
into a fairly comprehensive restatement as offered in
Lina v.Court of Appeals:
(a) The defendant in default may, at any time after
discovery thereof and before judgment, file a
motion, under oath, to set aside the order of
default on the ground that his failure to answer
was due to fraud, accident, mistake or excusable
neglect, and that he has meritorious defenses;
(Sec 3, Rule 18)
(b) If the judgment has already been rendered when
the defendant discovered the default, but before
the same has become final and executory, he may
file a motion for new trial under Section 1(a) of
Rule 37;
(c) 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;
and
(d) He may also appeal from the judgment rendered
against him as contrary to the evidence or to the
law, even if no petition to set aside the order of
default has been presented by him. (Sec. 2, Rule
41)
The fourth remedy, that of appeal, is anchored
on Section 2, Rule 41 of the 1964 Rules. Yet even after
that provision's deletion under the 1997 Rules, the
Court did not hesitate to expressly rely again on the
Lina doctrine, including the pronouncement that a
defaulted defendant may appeal from the judgment

10
Please read the original for the evolution of the rule with
regard to the right to appeal by a defaulted defendant.
rendered against him.
In Rural Bank of Sta. Catalina v. Land Bank of
the Philippines, the Court, through Justice Callejo, Sr.,
again provided a comprehensive restatement of the
remedies of the defending party declared in default,
which we adopt for purposes of this decision:
It bears stressing that a defending party
declared in default loses his standing in court
and his right to adduce evidence and to present
his defense. He, however, has the right to
appeal from the judgment by default and assail
said judgment on the ground, inter alia, that the
amount of the judgment is excessive or is
different in kind from that prayed for, or that the
plaintiff failed to prove the material allegations
of his complaint, or that the decision is contrary
to law. Such party declared in default is
proscribed from seeking a modification or
reversal of the assailed decision on the basis of
the evidence submitted by him in the Court of
Appeals, for if it were otherwise, he would
thereby be allowed to regain his right to adduce
evidence, a right which he lost in the trial court
when he was declared in default, and which he
failed to have vacated. In this case, the
petitioner sought the modification of the decision
of the trial court based on the evidence
submitted by it only in the Court of Appeals.
If it cannot be made any clearer, we hold that
a defendant party declared in default retains the right
to appeal from the judgment by default on the ground
that the plaintiff failed to prove the material allegations
of the complaint, or that the decision is contrary to
law, even without need of the prior filing of a motion to
set aside the order of default.

NOTE: Another issue of the case.
After the records had been transmitted to the CA when
OSG appealed, the RTC received a letter dated 21
February 2001 from the Land Registration Authority
(LRA) stating that only Lot Nos. 464-A and 464-B were
referred to in the Notice of Hearing published in the
Official Gazette; and that Lot No. 370, Cad No. 597
had been deliberately omitted due to the lack of an
approved survey plan for that property. Accordingly,
the LRA manifested that this lot should not have been
adjudicated to Martinez for lack of jurisdiction. This
letter was referred by the RTC to the Court of Appeals
for appropriate action.
Since the CA ruled in favor of the government and the
SC affirmed this decision, this issue became moot
there is no registration to cancel due to non-
publication because all of the lands registered in this
case were cancelled.


SANTOS, JR. v. PNOC EXPLORATION CORP

FACTS: respondent PNOC Exploration Corporation filed
a complaint for a sum of money against petitioner
Pedro T. Santos, Jr. in the Regional Trial Court of Pasig
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City, Branch 167. The complaint, docketed as Civil
Case No. 69262, sought to collect the amount of
P698,502.10 representing petitioner's unpaid balance
of the car loan advanced to him by respondent when
he was still a member of its board of directors.

Personal service of summons to petitioner failed
because he could not be located in his last known
address despite earnest efforts to do so. Subsequently,
on respondent's motion, the trial court allowed service
of summons by publication.
Respondent caused the publication of the
summons in Remate, a newspaper of general
circulation in the Philippines. Thereafter, respondent
submitted the affidavit of publication of the advertising
manager of Remate

and an affidavit of service of
respondent's employee

to the effect that he sent a
copy of the summons by registered mail to petitioner's
last known address.
When petitioner failed to file his answer within
the prescribed period, respondent moved that the case
be set for the reception of its evidence ex parte. The
trial court granted the motion in an order dated
September 11, 2003. The case was deemed submitted
for decision on October 15, 2003.
Petitioner filed an "Omnibus Motion for
Reconsideration and to Admit Attached Answer." He
sought reconsideration of the September 11, 2003
order, alleging that the affidavit of service submitted
by respondent failed to comply with Section 19, Rule
14 of the Rules of Court as it was not executed by the
clerk of court. He also claimed that he was denied due
process as he was not notified of the September 11,
2003 order. He prayed that respondent's evidence ex
parte be stricken off the records and that his answer
be admitted.
The trial court denied petitioner's motion for
reconsideration of the September 11, 2003 order. It
held that the rules did not require the affidavit of
complementary service by registered mail to be
executed by the clerk of court. It also ruled that due
process was observed as a copy of the September 11,
2003 order was actually mailed to petitioner at his last
known address. It also denied the motion to admit
petitioner's answer because the same was filed way
beyond the reglementary period.
Aggrieved, petitioner questioned the orders of
the RTC in the CA via petition for certiorari.
During the pendency of the petition in the
Court of Appeals, the trial court rendered its decision
in Civil Case No. 69262. It ordered petitioner to pay
P698,502.10 plus legal interest and costs of suit.
The CA, sustained RTC decision and denied
reconsideration.

ISSUES:
1. W/N RTC lack jurisdiction over his person due to
improper service of summons, failure of the trial court
to furnish him with copies of its orders and processes
including the September 11, 2003 order and
preference for technicality rather than justice and
equity.
2. W/N the rule on service by publication under Section
14, Rule 14 of the Rules of Court applies only to
actions in rem, not actions in personam like a
complaint for a sum of money.
3. W/N the affidavit of service of a copy of the
summons should have been prepared by the clerk of
court, not respondent's messenger.

RULING and RATIO:
1. NO. The effects of a defendant's failure to file an
answer within the time allowed are governed by
Sections 3 and 4, Rule 9 (on Effect of Failure to Plead)
of the Rules of Court:

SEC. 3. Default; declaration of. - If the
defending party fails to answer within the
time allowed therefor, the court shall,
upon motion of the claiming party with
notice to the defending party, and proof of
such failure, declare the defending party
in default. Thereupon, the court shall proceed
to render judgment granting the claimant such
relief as his pleading may warrant, unless the
court in its discretion requires the claimant to
submit evidence. Such reception of evidence
may be delegated to the clerk of court.

SEC. 4. Effect of order of default. - A party in
default shall be entitled to notice of
subsequent proceedings but not to take part
in the trial. (emphasis supplied)
If the defendant fails to file his answer on time,
he may be declared in default upon motion of the
plaintiff with notice to the said defendant. In case he is
declared in default, the court shall proceed to render
judgment granting the plaintiff such relief as his
pleading may warrant, unless the court in its discretion
requires the plaintiff to submit evidence. The
defaulting defendant may not take part in the trial but
shall be entitled to notice of subsequent proceedings.
In this case, even petitioner himself does not
dispute that he failed to file his answer on time. That
was in fact why he had to file an "Omnibus Motion for
Reconsideration and to Admit Attached Answer."
But respondent moved only for the ex
partepresentation of evidence, not for the declaration
of petitioner in default. However, in its In its February
6, 2004 order, the trial did not limit itself to permitting
respondent to present its evidence ex parte but in
effect issued an order of default. But the trial court
could not validly do that as an order of default can be
made only upon motion of the claiming party. Since no
motion to declare petitioner in default was filed, no
default order should have been issued.
However, even if petitioner was not validly
declared in default, he could not reasonably demand
that copies of orders and processes be furnished him.
There is obviously no way notice can be sent to him
and the notice requirement cannot apply to him. The
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law does not require that the impossible be
done. Nemo tenetur ad impossibile. The law obliges no
one to perform an impossibility. Laws and rules must
be interpreted in a way that they are in accordance
with logic, common sense, reason and practicality.

Be that as it may, a copy of the September 11, 2003
order was nonetheless still mailed to petitioner at his
last known address but it was unclaimed.

2. NO. Section 14, Rule 14 (on Summons) of the Rules
of Court provides:
SEC. 14. Service upon defendant whose
identity or whereabouts are unknown. - In any
action where the defendant is designated as
an unknown owner, or the like, or whenever
his whereabouts are unknown and cannot
be ascertained by diligent inquiry, service
may, by leave of court, be effected upon
him by publication in a newspaper of
general circulation and in such places and
for such times as the court may order.
(emphasis supplied)
Since petitioner could not be personally served
with summons despite diligent efforts to locate his
whereabouts, respondent sought and was granted
leave of court to effect service of summons upon him
by publication in a newspaper of general circulation.
Thus, petitioner was properly served with summons by
publication.
In substituted service, the in rem/in
personam distinction was significant under the old rule
because it was silent as to the kind of action to which
the rule was applicable. Because of this silence, the
Court limited the application of the old rule to in
remactions only. However, the present rule expressly
states that it applies "[i]n any action where the
defendant is designated as an unknown owner, or the
like, or whenever his whereabouts are unknown and
cannot be ascertained by diligent inquiry." Thus, it now
applies to any action, whether in personam, in
rem or quasi in rem.
[12]

3. The rules, however, do not require that the affidavit
of complementary service be executed by the clerk of
court. While the trial court ordinarily does the mailing
of copies of its orders and processes, the duty to make
the complementary service by registered mail is
imposed on the party who resorts to service by
publication.
Moreover, even assuming that the service of
summons was defective, the trial court acquired
jurisdiction over the person of petitioner by his
own voluntary appearance in the action against
him. Petitioner voluntarily appeared in the action when
he filed the "Omnibus Motion for Reconsideration and
to Admit Attached Answer." See Sec.20, Rule 14.


AQUINO v. AURE (this case has nothing to do with
default)

FACTS: Aure filed a complaint for ejectment against
Aquino before the MeTC. Aure and Aure Lending
alleged that they acquired the subject property from
Aquino. Aquino countered that the complain lacks
cause of action.
The MeTC rendered a decision, dismissing the
complaint for ejectment of Aure and Aure Lending for
non-compliance with the barangay conciliation process.
The MeTC observed that Aure and Aquino are residents
of the same barangay but there is no showing that any
attempt has been made to settle the case amicably at
the barangay level. On appeal, the RTC affirmed the
dismissal of the Complaint on the same ground that
the dispute was not brought before the Barangay
Council for conciliation.
Aure appealed with the CA arguing that the
lower court erred in dismissing his complaint for lack of
cause of action. The CA rendered a decision, reversing
the MeTC and RTC decisions. The appellate court
declared that the failure of Aure to subject the matter
to barangay conciliation is not a jurisdictional flaw and
it will not affect the sufficiency of Aures Complaint
since Aquino failed to seasonably raise such issue in
her Answer.

ISSUE: Whether or not non-compliance with the
barangay conciliation proceedings is a jurisdictional
defect that warrants the dismissal of the complaint.
NO.

RATIO: There is no dispute herein that the present
case was never referred to the Barangay Lupon for
conciliation. In fact, no allegation of such barangay
conciliation proceedings was made in Aure and Aure
Lendings Complaint before the MeTC.
However, as enunciated in the landmark case
of Royales v. Intermediate Appellate Court:
Ordinarily, non-compliance with the condition
precedent prescribed by P.D. 1508 could affect the
sufficiency of the plaintiff's cause of action and make
his complaint vulnerable to dismissal on ground of lack
of cause of action or prematurity; but the same would
not prevent a court of competent jurisdiction from
exercising its power of adjudication over the case
before it, where the defendants, as in this case, failed
to object to such exercise of jurisdiction in their answer
and even during the entire proceedings a quo.
In the case at bar, the Court finds that Aquino
cannot be allowed to attack the jurisdiction of the
MeTC. The Court takes note that the defendant herself
did not raise in defense the aforesaid lack of
conciliation proceedings in her answer, which raises
the exclusive affirmative defense of simulation. By this
acquiescence, defendant is deemed to have waived
such objection. The fact that Aquino raised such
objection during the pre-trial and in her Position Paper
is of no moment, for the issue of non-recourse to
barangay mediation proceedings should be impleaded
in her Answer.

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AMENDMENT AND SUPPLEMENT

PAGCOR v. LOPEZ

FACTS: PAGCOR entered into an Agreement with
FILGAME and BELLE Jai-Alai Corporation (BELLE) for
the resumption of the Jai-Alai operations in the
country. FILGAME and BELLE jointly agreed to provide
funds for pre-operating expenses and working capital
while PAGCOR shall manage, operate and control all
aspects of the Jai-Alai operations.
However, the Office of the President of the
Philippines issued a Memorandum directing PAGCOR to
close down all PAGCOR facilities and outlets in Jai-Alai,
on-line bingo and internet casino gaming. The DILG,
through Secretary Alfredo S. Lim, caused the closure
of the Jai-Alai main fronton.
FILGAME and BELLE filed the case for Specific
Performance and Injunction with prayer for Damages
and Temporary Restraining Order (TRO), and Writ of
Preliminary Injunction against PAGCOR, DILG and
Secretary Alfredo Lim. Respondent judge issued a writ
of temporary restraining order.
Meanwhile, the Supreme Court rendered a
decision enjoining PAGCOR, Belle, and Filgame from
managing, maintaining and operating jai-alai games,
and from enforcing the agreement entered into by
them for that purpose.
Consequently, FILGAME and BELLE filed a
Motion to Admit Amended Complaint with the trial
court where the cause of action was changed, i.e.,
from Specific Performance to Recovery of Sum of
Money. FILGAME and BELLE sought to recover their
pre-operating expenses and/or investments including
the goodwill money which they allegedly invested with
PAGCOR. PAGCOR filed an opposition on the ground
that there is a substantial change in the complaint and
cause of action. Respondent judge admitted the
amended complaint.
PAGCOR filed a motion to dismiss the amended
complaint on the ground that the trial court had not
acquired jurisdiction over the case for failure of the
plaintiffs to pay the prescribed docket fees. It claimed
that the amended complaint, which sought recovery of
the pre-operating expenses and investments including
the goodwill money, should have docket fees of
P15,775,903.68. Said Motion to Dismiss was denied by
the respondent judge.
FILGAME and BELLE manifested their intention
to file a Motion for Summary Judgment which they
subsequently filed. PAGCOR filed its opposition thereto.
Respondent judge did not conduct any hearing on the
motion for summary judgment. He thereafter rendered
his decision by way of Summary Judgment in favor of
FILGAME and BELLE.
PAGCOR charges respondent judge for gross
ignorance of the law and procedure and filed the
present administrative case.

ISSUE and RULING: w/n respondent judge erred in:

(1) admitting the amended complaint of
FILGAME and BELLE despite the fact that
(a) the amended complaint is a total
change of theory of the case; and
(b) that the required filing fees for the
amended complaint were not paid; and
---NO. (Relevant REM issue [Rule 10])

(2) in rendering summary judgment
(a) despite the fact that respondent
found the existence of 13 factual issues to be
resolved;
(b) without conducting a hearing on
the motion for summary judgment;
(c) based on the alleged implied
admission rather than on the personal
knowledge of witnesses and other affiants; and
---NO.

RATIO:
(1) Respondent judge did not err in admitting the
amended complaint of FILGAME and BELLE.

a. The Court finds no gross ignorance of law
committed by respondent when he
admitted the amended complaint
notwithstanding that such amended
complaint substantially altered the cause
of action of plaintiffs FILGAME and BELLE.

Section 3, Rule 10 of the Rules of Court,
provides:

SECTION 3. Amendments by leave of
court. Except as provided in the next
preceding section, substantial
amendments may be made only upon
leave of court. But such leave may be
refused if it appears to the court that
the motion was made with intent to
delay. Orders of the court upon the
matters provided in this section shall
be made upon motion filed in court,
and after notice to the adverse party,
and an opportunity to be heard.

Section 3, Rule 10 of the 1997 Rules of Civil
Procedure amended the former rule in such manner
that the phrase "or that the cause of action or defense
is substantially altered" was stricken-off and not
retained in the new rules. The clear import of such
amendment in Section 3, Rule 10 is that under
the new rules, "the amendment may (now)
substantially alter the cause of action or
defense." This should only be true, however, when
despite a substantial change or alteration in the cause
of action or defense, the amendments sought to be
made shall serve the higher interests of substantial
justice, and prevent delay and equally promote the
laudable objective of the rules which is to secure a
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"just, speedy and inexpensive disposition of every
action and proceeding.
The original complaint filed by the plaintiffs
was for specific performance and injunction with
prayer for damages and for TRO and writ of
preliminary injunction against PAGCOR while the
amended complaint was for recovery of sum of money.
Such amendment to the original complaint was
filed by plaintiffs FILGAME and BELLE after the
Supreme Court decision declared that PAGCOR could
not enter into a joint agreement with other
corporations to operate the Jai-Alai, and that the
Agreement is null and void. However, since plaintiffs
had provided funds for PAGCORs pre-operating
expenses and working capital, plaintiffs had to file an
amended complaint which seeks the recovery of their
expenses. Although the amended complaint
substantially changed the cause of action of
plaintiffs, the admission thereof by respondent
judge is allowed under Section 3, Rule 10 and
jurisprudence.

b. The Court also finds that respondent was
not guilty of gross ignorance of the law
when he admitted the amended complaint
despite the non-payment by plaintiffs
FILGAME and BELLE of additional docket
fees on the amended complaint.

The court had jurisdiction over the amended
complaint as it had acquired jurisdiction over the case
when the original complaint was filed and the
corresponding docket fee was paid thereon. Plainly,
while the payment of the prescribed docket fee is a
jurisdictional requirement, even its non-payment at
the time of filing does not automatically cause the
dismissal of the case, as long as the fee is paid within
the applicable prescriptive or reglementary period.
The Supreme Court in the Sun Insurance case had
further declared that any additional filing (docket) fee
shall constitute a lien on the judgment and that it shall
be the responsibility of the Clerk of Court or his duly
authorized deputy to enforce said lien and assess and
collect the additional fee provided that the cause of
action has not prescribed. Respondent judge issued
another Order that plaintiffs have still to pay the
amount of P14,717,171.19 based on the claim in the
amended complaint by directing the plaintiffs to pay
within 15 days from receipt. These actuations of
respondent are in accordance with the Sun Insurance
case.

(2) Respondent judge did not err in
rendering summary judgment

(a) despite the fact that
respondent found the existence of 13
factual issues to be resolved;

Based on evidence, PAGCOR was privy to all
the material allegations in the amended complaint
relating to the Jai-Alai operations. It would have been
incredulous for PAGCOR to claim ignorance or lack of
knowledge of said material allegations. Respondent
Judge had sufficient basis to render summary
judgment.

(b) without conducting a hearing
on the motion for summary judgment;

That there was no hearing conducted on the
motion for summary judgment, the same was with the
acquiescence of PAGCORs counsel. As correctly found
by the CA, based on the evidence, the trial type
hearing on the motion was dispensable in view of the
fact that PAGCORs blanket/ineffective denial in its
answer to the amended complaint had the effect of an
admission, thus, did not raise any genuine issues.
Furthermore, a hearing on the motion for summary
judgment was not necessary considering that the
evidence necessary for the resolution of the same was
already part of the records. It is evident from the
records, that PAGCOR was given ample opportunity to
be heard and present its evidence in opposition to the
motion for summary judgment, but PAGCOR chose not
to adduce any such evidence.

(c) based on the alleged implied
admission rather than on the personal
knowledge of witnesses and other
affiants;

It is a recognized rule in summary judgment
that the trial court can determine whether there is
genuine issue on the basis of the pleadings,
admissions, documents, affidavits, and/or counter-
affidavits submitted by the parties. On the basis of
this rule PAGCOR cannot claim that Respondent Judge
was grossly ignorant of the law and procedure when he
rendered summary judgment based on implied
admissions of the material facts in the amended
complaint and not on personal knowledge of witnesses
and other affiants.


ASEAN PACIFIC v. CITY OF URDANETA

FACTS: This case stemmed from a Complaint for
annulment of contracts with prayer for preliminary
prohibitory injunction and temporary restraining order
filed by respondent Capalad. Capalad doing business
under the name JJEFWA Builders, and petitioners
Asean Pacific Planners (APP)
Del Castillo alleged that then Urdaneta City
Mayor Rodolfo E. Parayno entered into five contracts
for the preliminary design, construction and
management of a four-storey twin cinema commercial
center and hotel involving a massive expenditure of
public funds amounting to P250 million, funded by a
loan from the Philippine National Bank (PNB). For
minimal work, the contractor was allegedly paid P95
million. Del Castillo also claimed that all the contracts
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are void because the object is outside the commerce of
men. The object is a piece of land belonging to the
public domain and which remains devoted to a public
purpose as a public elementary school. Additionally, he
claimed that the contracts, from the feasibility study to
management and lease of the future building, are also
void because they were all awarded solely to the Goco
family.
In their Answer, APP and APPCDC claimed that
the contracts are valid. Urdaneta City asserted that the
contracts were properly executed by then Mayor
Parayno with prior authority from the Sangguniang
Panlungsod. Mayor Perez also stated that Del Castillo
has no legal capacity to sue and that the complaint
states no cause of action.
After pre-trial, the Lazaro Law Firm entered its
appearance as counsel for Urdaneta City and filed an
Omnibus Motion7 with prayer to (1) withdraw
Urdaneta City's Answer; (2) drop Urdaneta City as
defendant and be joined as plaintiff; (3) admit
Urdaneta City's complaint; and (4) conduct a new pre-
trial. Urdaneta City allegedly wanted to rectify its
position and claimed that inadequate legal
representation caused its inability to file the necessary
pleadings in representation of its interests.
In its Order dated September 11, 2002, the
Regional Trial Court (RTC) of Urdaneta City,
Pangasinan, Branch 45, admitted the entry of
appearance of the Lazaro Law Firm and granted the
withdrawal of appearance of the City Prosecutor. It
also granted the prayer to drop the city as defendant
and admitted its complaint for consolidation with Del
Castillo's complaint, and directed the defendants to
answer the city's complaint.
In its February 14, 2003 Order,9 the RTC
denied reconsideration of the September 11, 2002
Order. It also granted Capalad's motion to expunge all
pleadings filed by Atty. Sahagun in his behalf. Capalad
was dropped as defendant, and his complaint filed by
Atty. Jorito C. Peralta was admitted and consolidated
with the complaints of Del Castillo and Urdaneta City.
The RTC also directed APP and APPCDC to answer
Capalad's complaint.
Aggrieved, APP and APPCDC filed a petition for
certiorari before the Court of Appeals. the Court of
Appeals dismissed the petition.
Hence, this petition, which we treat as one for
review on certiorari under Rule 45, the proper remedy
to assail the resolutions of the Court of Appeals.

ISSUE: Did the RTC err and commit grave abuse of
discretion in (a) entertaining the taxpayers' suits; (b)
allowing a private law firm to represent Urdaneta City;
(c) allowing respondents Capalad and Urdaneta City to
switch from being defendants to becoming
complainants; and (d) allowing Capalad's change of
attorneys?

RULING and RATIO:
A. In the case of taxpayers' suits, the party suing as a
taxpayer must prove that he has sufficient interest in
preventing the illegal expenditure of money raised by
taxation. Thus, taxpayers have been allowed to sue
where there is a claim that public funds are illegally
disbursed or that public money is being deflected to
any improper purpose, or that public funds are wasted
through the enforcement of an invalid or
unconstitutional law.
x x x x
Petitioners' allegations in their Amended
Complaint that the loan contracts entered into by the
Republic and NPC are serviced or paid through a
disbursement of public funds are not disputed by
respondents, hence, they are invested with personality
to institute the same.
Here, the allegation of taxpayers Del Castillo,
Del Prado, Ordono and Maguisa that P95 million of the
P250 million PNB loan had already been paid for
minimal work is sufficient allegation of overpayment,
of illegal disbursement, that invests them with
personality to sue. Petitioners do not dispute the
allegation as they merely insist, albeit erroneously,
that public funds are not involved. Under Article
195325 of the Civil Code, the city acquired ownership
of the money loaned from PNB, making the money
public fund. The city will have to pay the loan by
revenues raised from local taxation or by its internal
revenue allotment.
In addition, APP and APPCDC's lack of
objection in their Answer on the personality to sue of
the four complainants constitutes waiver to raise the
objection under Section 1, Rule 9 of the Rules of Court.
B. Petitioner contend that only the City Prosecutor can
represent Urdaneta City and that law and
jurisprudence prohibit the appearance of the Lazaro
Law Firm as the city's counsel.
Its appearance as Urdaneta City's counsel is
against the law as it provides expressly who should
represent it. The City Prosecutor should continue to
represent the city.

C. Petitioners claim that Urdaneta City is
estopped to reverse admissions in its Answer
that the contracts are valid and, in its pre-trial
brief, that the execution of the contracts was in
good faith.

We disagree. The court may allow amendment of
pleadings.
Section 5,41 Rule 10 of the Rules of Court
pertinently provides that if evidence is objected
to at the trial on the ground that it is not within
the issues raised by the pleadings, the court may
allow the pleadings to be amended and shall do
so with liberality if the presentation of the merits
of the action and the ends of substantial justice
will be subserved thereby. Objections need not
even arise in this case since the Pre-trial Order
dated April 1, 2002 already defined as an issue
whether the contracts are valid. Thus, what is
needed is presentation of the parties' evidence
on the issue. Any evidence of the city for or
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against the validity of the contracts will be
relevant and admissible. Note also that under
Section 5, Rule 10, necessary amendments to
pleadings may be made to cause them to
conform to the evidence.
In addition, despite Urdaneta City's judicial admissions,
the trial court is still given leeway to consider other
evidence to be presented for said admissions may not
necessarily prevail over documentary evidence, e.g.,
the contracts assailed. A party's testimony in open
court may also override admissions in the Answer.
As regards the RTC's order admitting Capalad's
complaint and dropping him as defendant, we find the
same in order. Capalad insists that Atty. Sahagun has
no authority to represent him. Atty. Sahagun claims
otherwise. We note, however, that Atty. Sahagun
represents petitioners who claim that the contracts are
valid. On the other hand, Capalad filed a complaint for
annulment of the contracts. Certainly, Atty. Sahagun
cannot represent totally conflicting interests. Thus, we
should expunge all pleadings filed by Atty. Sahagun in
behalf of Capalad.

D. Relatedly, we affirm the order of the RTC in allowing
Capalad's change of attorneys, if we can properly call it
as such, considering Capalad's claim that Atty.
Sahagun was never his attorney.
WHEREFORE, we (1) GRANT the petition; (2) SET
ASIDE the Resolutions dated April 15, 2003 and
February 4, 2004 of the Court of Appeals in CA-G.R. SP
No. 76170; (3) DENY the entry of appearance of the
Lazaro Law Firm in Civil Case No. U-7388 and
EXPUNGE all pleadings it filed as counsel of Urdaneta
City; (4) ORDER the City Prosecutor to represent
Urdaneta City in Civil Case No. U-7388; (5) AFFIRM
the RTC in admitting the complaint of Capalad; and (6)
PROHIBIT Atty. Oscar C. Sahagun from representing
Capalad and EXPUNGE all pleadings that he filed in
behalf of Capalad.
Let the records be remanded to the trial court for
further proceedings.


TIU v. PBCOM

FACTS: Asian Water Resources, Inc. (AWRI),
represented by herein petitioners Henry Tiu,
Christopher Go, and George Co, applied for a real
estate loan with the Philippine Bank of
Communications (PBCOM). The first loan was secured
by a piece of land as collateral. Subsequently, a bigger
loan was applied for by AWRI but without an additional
real estate collateral. Instead, the members of the
Board of Directors of AWRI were required to become
sureties under a Surety Agreement. AWRI defaulted on
its obligation and offered all its properties to be applied
in a dacion en pago arrangement. PBCOM, however,
rejected this offer and sued for collection. In the
Answer of petitioners, they claimed that the Surety
Agreement attached to the complaint were falsified,
considering that when they signed the same, the
words "In his personal capacity" did not yet appear in
the document and were merely intercalated thereon
without their knowledge and consent. PBCOM realized
this mistake and explained that the insertion was
ordered by the bank auditor since standard procedures
warranted that the words in his personal capacity be
indicated under the name of each surety. It was
alleged to have been made to reflect the parties true
intentions. PBCOM then filed a Reply and Answer to
Counterclaim with Motion for Leave of Court to
Substitute Annex "A" of the Complaint,
16
wherein it
attached the duplicate original copy retrieved from the
file of the notary public. This version did not anymore
include the alleged intercalated words. PBCOm urged
the trail court to treat its motion as a motion for leave
of court to amend and admit the amended complaint
pursuant to Section 3, Rule 10 of the Rules of Court.
Petitioners meanwhile maintain that PBCOMs cause of
action was solely and principally founded on the
alleged falsified document originally marked as the
Annex. Thus, the withdrawal of the document results in
the automatic withdrawal of the whole complaint on
the ground that there is no more cause of action to be
maintained or enforced by plaintiff against petitioners.
Also, petitioners argue that if the substitution will be
allowed, their defenses that were anchored on the
alleged falsified copy of the Agreement would be
gravely affected.

ISSUE: Does the substitution of the alleged falsified
document qualify as an amendment of the complaint?
Should such amendment be allowed?

RULING and RATIO:
Yes. When a cause of action is anchored on a
document, its substance must be set forth, and the
original or a copy thereof shall be attached to the
pleading as an exhibit and deemed a part thereof. With
respect to PBCOMs right to amend its complaint,
including the documents annexed thereto, Section 3,
Rule 10 of the Rules of Court specifically allows
amendment with leave of court. Moreover, by virtue of
the amendment of the Rules in 1997, an amendment
may now substantially alter the cause of action or
defense. Second, the granting of leave of court to
amend a pleading is discretionary. And even if the
amendment substantially alters the cause of action or
defense, such amendment could still be allowed when
it is sought to serve the higher interest of substantial
justice. Courts should be liberal in allowing
amendments to pleadings to avoid a multiplicity of
suits and in order that the real controversies between
the parties are presented, their rights determined, and
the case decided on the merits without unnecessary
delay. Furthermore, amendments to pleadings are
generally favored and should be liberally allowed in
furtherance of justice in order that every case, may so
far as possible, be determined on its real facts and in
order to speed up the trial of the case or prevent the
circuity of action and unnecessary expense. In the
present case, there was no fraudulent intent on the
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part of PBCOM in submitting the altered surety
agreement. In fact, the bank admitted that it was a
mistake on their part to have submitted it in the first
place instead of the original agreement. The
substitution was also in accordance to the best
evidence rule. Lastly, contrary to petitioners
contention, they could not be prejudiced by the
substitution since they can still present the substituted
documents as part of the evidence of their affirmative
defenses. Further, the petitioners are not precluded
from filing the appropriate criminal action against
PBCOM for attaching the altered copy of the surety
agreement to the complaint. It cannot thus maintain
that it was prejudiced by the substitution/amendment.

BILL OF PARTICULARS

BARITUA v. MERCADER

FACTS: The original complaint was filed against JB
Lines, Inc. (Petitioner) by heirs of Dominador Mercader
(respondents) arising from the breach of contract of
carriage.
Dominador Mercader boarded petitioners bus
bound for Northern Samar as a paying passenger. He
was not able to reach his destination because the said
bus fell into the river resulting in his death.
Petitioner JB Lines, Inc.] filed a motion to
dismiss complaint, to strike out false-impertinent
matters therefrom, and/or for bill of particulars on the
primary grounds that [respondents] failed to implead
Jose Baritua as an indispensable party and that the
cause of action is a suit against a wrong and non-
existent party.
Respondents filed an opposition to the said
motion and an amended complaint. In its answer,
petitioners denied specifically all the material
allegations in the complaint.

The RTC, after due trial, rendered the decision
in favor of the respondents. This was affirmed by the
CA modifying only the amount of lost earnings to be
awarded .

ISSUE: Whether the CA disregarded petitioners'
procedural rights when it ruled on the case without
recognizing their motion for bill of particulars. NO.

RATIO: Petitioners argue that the CA erred when it
passed sub silencio on the trial court's failure to rule
frontally on their plea for a bill of particulars.
It must be noted that petitioners' counsel
manifested in open court his desire to file a motion for
a bill of particulars. The RTC gave him ten days from
March 12, 1985 within which to do so. He, however,
filed the aforesaid motion only on April 2, 1985 or
eleven days past the deadline set by the trial court.


Moreover, such motion was already moot and
academic because, prior to its filing, petitioners had
already filed their answer and several other pleadings
to the amended Complaint. Section 1, Rule 12 of the
Rules of Court, provides:

"Section 1. When applied for; purpose. --
Before responding to a pleading, a party may
move for a more definite statement or for a bill
of particulars of any matter which is not
averred with sufficient definiteness or
particularity to enable him properly to prepare
his responsive pleading. If the pleading is a
reply, the motion must be filed within ten (10)
days from service thereof. Such motion shall
point out the defects complained of, the
paragraphs wherein they are contained, and
the details desired."
16
(emphasis supplied)


REYES v. RTC of MAKATI

FACTS: Oscar and Rodrigo Reyes are 2 of the 4
children of Pedro and Anastacia Reyes. These 4 all
owned shares in Zenith Insurance Corporation, a
family corporation. Pedro and Anastacia both died, but
Anastacias estate was not settled, including her
shares. By 1990 Oscar owned ~8.7M shares, Rodrigo
owned ~4.2K shares.
In 2000, Rodrigo as shareholder filed a
derivative suit against Oscar for 1. Accounting of
assets of Zenith, and 2. Determination of shares and
profits fraudulently appropriated by Oscar and delivery
to his siblings of their rightful portion of shares and
profits. It was filed in the SEC, then transferred to the
present special commercial court in Makati because of
the passage of the Securities Regulation Code which
transferred jurisdiction over certain cases to the RTC.
Oscar filed a motion to declare the suit a
nuisance suit. The RTC dismissed only the second
cause of action on the ground that the same should be
properly done in a settlement of estate proceeding.
Certiorari[65] by Oscar to the CA was denied, thus the
present appeal.

ISSUE: W/N the commercial court of Makati has
jurisdiction over the complaint. NO.

RATIO: Jurisdiction is conferred by law and
determined by the allegations in the complaint. Section
5, Rule 8 of the Revised Rules of Court provides that in
all averments of fraud or mistake, the
circumstances constituting fraud or mistake must
be stated with particularity. This was not done in
this case. The averments of fraud were all made
generally, e.g. This is a complaint...to determine the
shares of stock of the deceased spouses Pedro and
Anastacia Reyes that were arbitrarily and fraudulently
appropriated for himself, Respondent Oscar C.
Reyes, through other schemes of fraud including
misrepresentation, unilaterally, and for his own
benefit, capriciously transferred and took possession
and control of the management of Zenith. The
complaint made general averments and conclusions of
law; without statements of the facts to which the
allegations of fraud refer, these do not sufficiently
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state an effective cause of action. These also do not
give the opponent a chance to prepare his defense.
Not every allegation of fraud done in a
corporate setting or perpetrated by corporate officers
will bring the case within the special commercial
court's jurisdiction. To fall within this jurisdiction, there
must be sufficient nexus showing that the corporation's
nature, structure, or powers were used to facilitate the
fraudulent device or scheme. This was not so here, for
what was alleged was that Oscar used fraud to
increase his shares, profit and control which enabled
him to become the corporations President. This is not
enough.
In ordinary cases, the failure to specifically
allege the fraudulent acts does not constitute a ground
for dismissal since such defect can be cured by a bill of
particulars. In cases governed by the Interim Rules of
Procedure on Intra-Corporate Controversies, however,
a bill of particulars is a prohibited pleading. It is
essential, therefore, for the complaint to show on its
face what are claimed to be the fraudulent corporate
acts if the complainant wishes to invoke the court's
special commercial jurisdiction.


REPUBLIC v. SANDIGANBAYAN (2007)

FACTS: The Presidential Commission on Good
Government (PCGG), through the OSG, filed a
Complaint for reconveyance, reversion, accounting,
restitution and damages alleging that Cruz
11
(the
alleged crony in this case), the former President
Marcos, and Mrs. Marcos stole public assets and
invested them in several institutions here and abroad.
The Marcoses failed to file an answer and were
declared in default. Then the former President died and
was substituted by his estate. Mrs. Marcos filed a
Motion to Set Aside Order of Default, which was
granted. The court then directed the former President
Marcos' children to appear before it or it will proceed
with pre-trial and subsequent proceedings. Respondent
Marcos Jr. filed a Motion for Leave to File a Responsive
Pleading as executor of his late father's estate, which
was granted. Respondent asked for three extensions
totaling 35 days to file an answer. But instead of filing
an answer, he filed a Motion for Bill of Particulars
which was again upheld.
Petitioner Republic contended that since the
default order against former President Marcos has not
been lifted by any court order, respondent cannot file a
motion for a bill of particulars. That Respondent was
granted leave to file an answer to the expanded
complaint, not a motion for a bill of particulars; that
the motion is dilatory. That respondent impliedly

11
Roman A. Cruz, Jr. (Cruz), then president and general
manager of GSIS, president of PAL, chairman and president
of the Hotel Enterprises of the Philippines, Inc., owner of
Hyatt Regency Manila, chairman and president of Manila Hotel
Corporation; and chairman of the Commercial Bank of Manila
(CBM).
admitted that the complaint sufficiently averred factual
matters because he was able to prepare a draft
answer, as stated in his second and third motions for
extension. That Mrs. Marcos and Cruz had already filed
their respective answers. Petitioner maintained that
the expanded complaint "illustrated the essential acts
pertaining to the conspirational acts" between Cruz
and former President Marcos.
Respondent Marcos Jr. countered that the
allegations consisted of mere conclusions of law and
were too vague and general. That the default order
against his father was effectively lifted; otherwise, he
would not have been called by the court to appear
before it and allowed to file a responsive pleading.

ISSUE: Did the court commit GADALEJ in granting
respondent's motion for a bill of particulars as executor
of former President Marcos' estates considering that
the deceased defendant was then a defaulting
defendant when the motion was filed? NO.

RULING: Under the Rules of Court, a defending party
may be declared in default, upon motion and notice,
for failure to file an answer within the allowable period.
In this case, former President Marcos died while in
exile in Hawaii while this case was pending. His
representatives failed to file a motion to lift the order
of default. Nevertheless, respondent, as executor of
his father's estate, filed a motion for leave to file a
responsive pleading, three motions for extensions to
file an answer, and a motion for bill of particulars all of
which were granted by the anti-graft court.
The legal effect of the grant of these motions is
that the default order against the former president is
deemed lifted. The act of the court in entertaining such
motions during the pre-trial stage of the proceedings
effectively meant that respondent has acquired a locus
standi in this case. That he filed a motion for a bill of
particulars instead of an answer does not pose an issue
because he, as party defendant representing the
estate, is allowed to do so under the Rules of Court to
be able to file an intelligent answer. It follows that
petitioner's filing of a bill of particulars in this case is
merely a condition precedent to the filing of an
answer.
The allegations against former President
Marcos are obviously couched in general terms. While
the allegations as to the alleged specific acts of Cruz
were clear, they were vague and unclear as to the acts
of the Marcos couple who were allegedly "in unlawful
concert with" the former. There was no factual
allegation in the original and expanded complaints on
the collaboration of or on the kind of support extended
by former President Marcos to Cruz in the commission
of the alleged unlawful acts constituting the alleged
plunder. The alleged acts, conditions and
circumstances that could show the conspiracy among
the defendants were not particularized and sufficiently
set forth by petitioner.
That the late president's co-defendants were
able to file their respective answers to the complaint
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does not necessarily mean that his estate's executor
will be able to file an equally intelligent answer, since
the answering defendants' defense might be personal
to them.
Lastly, the allowance of the motion for a more
definite statement rests with the sound discretion of
the court. As usual in matters of a discretionary
nature, the ruling of the trial court will not be reversed
unless there has been a palpable abuse of discretion or
a clearly erroneous order.

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Depositions
A. Deposition taken in another Proceeding

CARIAGA V. COURT OF APPEALS

FACTS: Luis Miguel Aboitiz was, at the time of the incident in
question, the Systems Analyst of the Davao Light & Power
Company (DLPC). He received reports that some private
electricians were engaged in the clandestine sale of DLPC
materials and supplies. He initiated a covert operation to
discover the people involved. He sought the assistance of Sgt.
Fermin Villasis of Davao Police and Florencio Siton (a.k.a
Canuto Duran) as undercover agent.
Canuto Duran struck an acquaintance with one
Ricardo Cariaga, a private electrician, at a store. He told
Ricardo that his boss ordered him to buy electrical materials.
Ricardo offered to supply Canuto Duran with electrical
materials, saying that he has a cousin from whom he can
procure the same. Canuto purchased small electrical wires
which, according to Ricardo, came from his cousin, Jonathan
Cariaga. It turned out that Jonathan was the assigned driver of
a DLPC Service Truck. Canuto inquired from Jonathan if he
could supply him with the supplies he needed and when he
said yes, Canuto placed an order. They agreed to meet an a
certain place to facilitate the transaction. Note that several
other transactions between the same parties transpired after
this.
One day, a police team apprehended Canuto and
turned him over to the station. The team was unable to arrest
Ricardo as he had already left when the team arrived at his
house. Canuto Duran confessed in order to persuade Ricardo
and the others who were involved to likewise come out with
the truth. Ricardo came to the police station and confessed to
the crime. He revealed that he acted as a fence for his cousin,
Jonathan Cariaga. He also confessed that the supplies were
DLPC properties.
The prosecution was unable to present Ricardo as its
witness as the subpoena could not be personally served upon
him as according to his wife, Antonieta Cariaga, he was in
Sultan Kudarat and the date of his return to Davao City was
not certain.
The trial court convicted Jonathan Cariaga. CA
affirmed. The Court of Appeals reasoned out that the sworn
statement of Ricardo Cariaga who did not testify in open court
during the criminal proceedings against petitioner is admissible
in evidence and properly considered by the trial court as this
was annexed as part of DLPCs position paper submitted to the
National Labor Relations Commission in a complaint filed by
the accused for illegal dismissal, as an exception to the
hearsay rule under Section 47, Rule 130 of the Revised Rules
of Court.

ISSUE: W/N the sworn statement of Ricardo Cariaga which
was attached to DLPCs position paper in the labor case filed
by Jonathan Cariaga is admissible? NO, IT IS NOT
ADMISSIBLE.

HELD: Section 47 of Rule 130 reads: SEC. 47. Testimony or
deposition at a former proceeding. The testimony or deposition
of a witness deceased or unable to testify, given in a former
case or proceeding, judicial or administrative, involving the
same parties and subject matter, may be given in evidence
against the adverse party who had the opportunity to cross-
examine him.
More specific however is the rule prescribed in Rule
115, Section 1(f) of the Rules of Court in respect of the
admissibility in evidence in a criminal case of the previous
testimony of unavailable witnesses which reads:
Section 1. Rights of accused at the trial. In all criminal
prosecutions, the accused shall be entitled:
f) To confront and cross-examine the witnesses
against him at the trial. Either party may utilize as
part of its evidence the testimony of a witness who is
deceased, out of or can not with due diligence be
found in the Philippines, unavailable or otherwise
unable to testify, given in another case or proceeding,
judicial or administrative, involving the same parties
and subject matter, the adverse party having had the
opportunity to cross-examine him;
The records reveal that witness Ricardo Cariaga was
subpoenaed only once and did not appear to testify in the
criminal case against petitioner. Concededly, this witness was
not deceased or out of the Philippines. In fact, the private
prosecutor informed the court that he is in Sultan Kudarat, and
previously, his wife informed the sheriff that he was in Sultan
Kudarat which is in Cotabato, a mere four hours drive from
Davao City. Against this backdrop, can this witness be
categorized as one that cannot be found despite due diligence,
unavailable or unable to testify. We are inclined to rule in the
negative and reverse the Court of Appeals on this point.
It must be emphasized that this rule is strictly
complied with in criminal cases, hence, mere sending of
subpoena and failure to appear is not sufficient to prove
inability to testify. The Court must exercise its coercive power
to arrest. In the instant case, no efforts were exerted to have
the witness arrested which is a remedy available to a party-
litigant in instances where witnesses who are duly subpoenaed
fail to appear. On this score alone, the sworn statement of
Ricardo Cariaga should not have been admitted as evidence for
the prosecution.

B. Deposition may be taken anytime after
institution of any action; uses of Deposition

JONATHAN LAND OIL V. MANGUDADATU

Facts: Suharto and Miriam Sangki Mangudadatu
(Mangudadatus) filed with the RTC in Tacurong City, Sultan
Kudarat, a complaint for damages against Jonathan Landoil
International Co., Inc. ("JLI"). During the pre-trial, JLI failed to
appear and was thus declared in default. As a result, JLI filed
an Omnibus Motion for New Trial and Change of Venue. This
was eventually denied by the Court and a Writ of Execution
was issued against them.
JLI filed a Motion to Quash/Recall Writ of Execution
since they were not able to receive a copy of an order
resolving their motion for new trial. To make matters worse,
their counsels, Attys. Mario Jr. and Peligro submitted
withdrawals of appearance. They were replaced by new
lawyers and the affidavits of Mario and Peligro attesting that
they had not yet received a copy of the Order resolving the
Motion for New Trial were attached.
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JLI then received a notice regarding the public
auction sale of their properties. By reason of the immediate
threat to implement the Writ of Execution, it filed with the CA a
Petition for Prohibition seeking to enjoin the enforcement of
the Writ until the resolution of the Motion to Quash.
The RTC ordered the Mangudadatus to comment on
the motion to quash filed by JLI. In their comment, they
attached two separate Certifications supposedly issued by the
postmaster of Tacurong City, affirming that the Order denying
the Motion for New Trial had been received by Mario and
Peligro. To clear things up, counsel for JLI personally served
counsel for the Mangudadatus a Notice to Take Deposition
upon Oral Examination of Attys. Mario and Peligro. The
Deposition was intended to prove that JLI had not received a
copy of the Order denying the Motion for New Trial. Thus, the
depositions of their former counsels were taken.
The RTC denied JLIs motion to quash. The CA ruled
that JLI could no longer avail itself of a deposition under Rule
23 of Rules of Court, since trial had already been terminated
(because a decision was rendered after JLIs default).

Issue: Can JLI avail of the depositions of their former
counsels despite the case being terminated?

Decision: Yes.
A deposition may be taken with leave of court after
jurisdiction has been obtained over any defendant or over
property that is the subject of the action; or, without such
leave, after an answer has been served. Deposition is chiefly a
mode of discovery, the primary function of which is to
supplement the pleadings for the purpose of disclosing the real
points of dispute between the parties and affording an
adequate factual basis during the preparation for trial.
The Rules of Court and jurisprudence, however, do
not restrict a deposition to the sole function of being a mode
of discovery before trial. Under certain conditions and for
certain limited purposes, it may be taken even after trial has
commenced and may be used without the deponent being
actually called to the witness stand. Thus, "[d]epositions may
be taken at any time after the institution of any action,
whenever necessary or convenient. There is no rule that limits
deposition-taking only to the period of pre-trial or before it; no
prohibition against the taking of depositions after pre-trial.

Depositions are allowed, provided they are taken in
accordance with the provisions of the Rules of Court (that is,
with leave of court if the summons have been served, without
leave of court if an answer has been submitted); and provided,
further, that a circumstance for their admissibility exists
(Section 4, Rule 23, Rules of Court).

The Rules of Court vest in the trial court the
discretion to order whether a deposition may be taken or not
under specified circumstances that may even differ from those
the proponents have intended. However, it is well-settled that
this discretion is not unlimited. It must be exercised -- not
arbitrarily, capriciously or oppressively -- but in a reasonable
manner and in consonance with the spirit of the law, to the
end that its purpose may be attained.
In this case, the depositions involved a circumstance
that fell under Section 4(c)(2) of Rule 23.
1
The witnesses of JLI
in Metro Manila resided beyond 100 kilometers from Sultan
Kudarat, the place of hearing. JLI offered the depositions in
support of its Motion to Quash (the Writ of Execution) and for
the purpose of proving that the trial courts Decision was not
yet final. As previously explained, despite the fact that trial has
already been terminated, a deposition can still be properly
taken.

C. Deposition not a substitute for actual
testimony

SALES VS. SABINO

Facts: Respondent Sabino filed an action for damages against,
among others, Sales who was the driver of the vehicle involved
in an accident which ultimately caused the death of Sabinos
son. Before an answer was filed, Sabino notified the defendant
that he will take the deposition of Buaneres Corral. The
deposition was taken before the clerk of court, where the
counsel of Sales participated and cross-examined Corral. The
deposition, together with a certification from the Bureau of
Immigration (BOI), attesting to the departure of Corral for
abroad, was offered in evidence by Sabino. This was opposed
to by Sales on the ground that the jurisdiction requirements for
their admission under Sec. 4, Rule 23 were not complied with.
He argued that the certification by the BOI only showed that
Corral left the country on the date mentioned therein, and that
it does not prove that he has not returned since then and is
unavailable to be present in court to personally testify. TC
admitted the evidence. On certiorari, CA agreed with the TC.

Issue: W/N the TC and CA were correct in admitting the
deposition.

Held/Ratio: SC agreed with CA. It ruled that the situation
falls w/in one of the exceptions in Sec. 4, Rule 23 (specifically,
that the witness is out of the Philippines).

General Rule
Depositions are not meant to substitute for the actual
testimony in open court of a party or witness. It is not to be
used when the deponent is at hand. If it does not fall within
any of the exceptions enumerated in Sec. 4, Rule 23, it may be
opposed to and excluded on the ground of hearsay.

Exceptions

1
The deposition of a witness, whether or not a party, may be used by
any party for any purpose if the court finds: (1) that the witness is
dead; or (2) that the witness resides at a distance more than one
hundred (100) kilometers from the place of trial or hearing, or is out of
the Philippines, unless it appears that his absence was procured by the
party offering the deposition; or (3) that the witness is unable to
attend or testify because of age, sickness, infirmity, or imprisonment;
or (4) that the party offering the deposition has been unable to
procure the attendance of the witness by subpoena; or (5) upon
application and notice, that such exceptional circumstances exist as to
make it desirable, in the interest of justice and with due regard to the
importance of presenting the testimony of witnesses orally in open
court, to allow the deposition to be used;
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1. Witness is dead;
2. Witness resides 100kms from the place of trial or
hearing, or is out of the Philippines, unless it appears
that his absence was procured by the party offering
the deposition;
3. Witness is unable to attend because of age, sickness,
infirmity, or imprisonment;
4. Party offering the deposition has been unable to
procure the attendance of the witness by subpoena;
or
5. Upon application and notice, that such exceptional
circumstances exist as to make it desirable, in the
interest of justice and with due regard to the
importance of presenting the testimony of witnesses
orally in open court, to allow the deposition to be
used.
NB: The party against whom the deposition is sought to be
used should have been present or represented at the taking of
the deposition, or at least had due notice thereof.
SC said here that the certification by the Bureau of
Immigration provided the necessary evidentiary support to
prove that Corral was out of the country when the deposition
was offered.

Also, on waiver
Sabino argued that there was a waiver of the objection to the
admission of the deposition when Sales counsel participated in
the taking of the deposition. SC did not agree holding that,
according to Sec. 29, Rule 3, objections to competency of
witness or competence, relevancy or materiality of testimony
are not waived unless they could have been obviated at the
time the deposition was taken. Remember, in depositions
taking is different from using.

D. Period to apply for Deposition

ROSETE v LIM

FACTS: Spouses Lim sued Rosete, BPI, Register of Deeds,
Espreme Realty and AFP-RSBS for Annulment of Deed of Sale
and Specific Performance. The spouses wanted the Deed of
Sale over a parcel of land executed by AFP-RSBS in favor of
Espreme Realty annulled and consequently, that the titles of
Espreme be cancelled and land be restored to the spouses by
the Register of Deeds.
Several Motions to Dismiss were filed by Rosete et al
on the ground of lack of jurisdiction and venue being
improperly laid. These were all dismissed prompting Rosete et
al to file a petition for certiorari.
While the certiorari suit was pending, the spouses
filed a Motion to Serve Supplemental Allegations against BPI
and Rosete. The RTC granted prompting Rosete et al to again
bring the ruling on certiorari.
Meanwhile, Rosete et al filed an Ex Parte Motion to
Admit Answer Ex Abudanti Cautela (meaning out of abundant
caution).
On the other hand the spouses filed a Notice to Take
Deposition upon Oral Examination. This was opposed by
Rosete et al saying that leave of court was necessary as there
was no answer filed by them yet and the issues have not yet
been joined because their Answer was filed Ex Abudanti
Cautela pending resolution of their certioraris. Also, Rosete et
al contend that since there are pending criminal cases against
them on the same facts, their right to self-incrimination may
be violated the allegations of fact the spouses are seeking are
the same allegations of fact in the criminal action.
Both the RTC and CA ruled in favor of the spouses

ISSUE: Whether or not leave of court is necessary to serve
written depositions and interrogatories NO

HELD: When to serve written depositions and interrogatories
is spelled clearly in Section 1, Rule 23 of the Rules of Court.
Before an answer has been filed but after the court obtained
jurisdiction over the defendant or property subject of an
action, leave of court is necessary. If an answer has been filed
no leave of court is necessary. In this case, the Answer Ex
Abundati Cautela does not make the answer less of an answer.
It has all the attributes of an answer namely, that it sets out
the litigants defenses. There being a complaint and an answer
which completely defines each sides claims and defenses,
there is no reason to believe why the issues have not yet been
joined as argued by Rosete et al.

E. Non-resident foreign corporation to testify
through deposition

SAN LUIS V JUDGE ROJAS, BERDEX INTERNATIONAL
(sorry if a bit long, daming issues relevant to depositions)

Facts: Berdex, a Californian corporation, filed a complaint for a
sum of money against San Luis. It alleged that it was a non-
resident foreign corporation suing on an isolated transaction.
Berdex claimed that San Luis loaned money from it and that
San Luis refused to sign the contract of loan. San Luis claimed
that there was no loan contract, and whatever money San Luis
initially gave Berdex was not a sign of his liability to Berdex.
(facts really not super important since issue was on the
deposition)

Berdex filed a motion to authorize deposition taking through
written interrogatories, stating that all of its witnesses are
Americans who reside or hold office in the US and that one of
the witnesses was really old and could not travel to the
Philippines, and that there was a perceived danger because of
the 9-11 attacks.
San Luis opposed the deposition, claiming that it
would deprive the court the chance to examine the demeanor
of the witnesses. He also claimed that his right to cross-
examine the witnesses would be impaired.
The lower courts and the CA allowed the depositions
to be taken.

Issue: Whether Section 1, Rule 23 of the Rules of Court
allows a non-resident foreign corporation the privilege
of having all its witnesses, all of whom are foreigners,
to testify through deposition upon written
interrogatories taken outside the Philippines to prove
an oral contract

Held: Yes.
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Unequivocally, the rule does not make any distinction or
restriction as to who can avail of deposition. The fact that
private respondent is a non-resident foreign corporation is
immaterial. The rule clearly provides that the testimony of any
person may be taken by deposition upon oral examination or
written interrogatories, at the instance of any party.
Depositions serve as a device for ascertaining the facts relative
to the issues of the case. The evident purpose is to enable the
parties, consistent with recognized privileges, to obtain the
fullest possible knowledge of the issues and facts before civil
trials and thus prevent the said trials from being carried out in
the dark.
This situation is one of the exceptions for its
admissibility under Section 4(c)(2), Rule 23 of the Rules of
Court, i.e., that the witness resides at a distance of more than
one hundred (100) kilometers from the place of trial or
hearing, or is out of the Philippines, unless it appears that his
absence was procured by the party offering the deposition.

On the Dasmarinas case
San Luis insists that Dasmarias does not constitute a
precedent in the instant case as the facts are substantially
different; to wit: (1) in Dasmarias, plaintiff filed a motion to
take deposition through written interrogatories of two
witnesses abroad after it had already presented its first
witness, while in the present case, private respondent will not
present a single witness to testify in court but only the
witnesses depositions; (2) in Dasmarias, the existence of the
contract involved was not in issue at all, while in the present
case, petitioner denied the existence of the alleged contract of
loan and private respondent has not presented any
documentary evidence to support its claim.
San Luis is wrong. The situation in Dasmarias is the same
as in the instant case since in both cases, it was already during the
trial stage that the deposition through written interrogatories was
sought to be taken. It does not matter whether one witness for the
plaintiff had already testified since the Dasmarias ruling did not
make such testimony in court a condition to grant the deposition of
the two other witnesses. Also, in Dasmarias, the plaintiff sued
defendant to recover a certain sum of money which was the same
as in the instant case as private respondent was suing petitioner for
collection of sum of money.

On claim that the right to take depositions would result in injustice
since oral contracts need a stricter standard of proof
San Luis is wrong. While there are limitations to the rules of
discovery, even when permitted to be undertaken without
leave and without judicial intervention, such limitations
inevitably arise when it can be shown that the examination is
being conducted in bad faith, is irrelevant or merely done to
annoy.
Deposition discovery rules are to be accorded a broad
and liberal treatment and should not be unduly restricted if the
matters inquired into are otherwise relevant and not privileged,
and the inquiry is made in good faith and within the bounds of
law. Otherwise, the advantage of a liberal discovery procedure
in ascertaining the truth and expediting the disposal of
litigation would be defeated. In fact, there is nothing in the
rules on deposition that limits their use in case of oral contract
as alleged by San Luis.
In any event, the admissibility of the deposition does
not preclude the determination of its probative value at the
appropriate time.

On claim that deposition will prevent court from observing the
demeanor
San Luis wrong. Depositions are allowed as a departure
from the accepted and usual judicial proceedings of examining
witnesses in open court. It precisely falls within one of the
exceptions where the law permits such a situation, i.e., the use
of a deposition in lieu of the actual appearance and testimony
of the deponent in open court and without being subject to the
prying eyes and probing questions of the Judge. Depositions
are allowed provided the deposition is taken in accordance
with the applicable provisions of the Rules of Court; that is,
with leave of court if the summons have been served, without
leave of court if an answer has been submitted; and provided,
further, that a circumstance for their admissibility exists.

On right to cross-examine
The rules allow San Luis to submit cross-interrogatories upon
private respondent with sufficient fullness and freedom.

On lack of enforcement for perjury
No issue yet so court will not rule on it.

F. Application of Rule 23 in criminal cases

MANGUERRA, ET AL. V. RISOS, ET AL.

Facts: Before the RTC Cebu, Raul Risos, Susan Yongco, Leah
Abarquez and Atty. Gamaliel Bonje (Risos, et al.) were
charged with Estafa Through Falsification of Public
Document (i.e. the deed of real eastate mortgage), where they
made it appear that Concepcion Cuenco Vda. de Manguerra
(Concepcion), the owner of the mortgaged property (the
Gorordo property), affixed her signature to the document.
Risos, et al. filed a Motion for Suspension of the Proceedings in
the criminal case on the ground of prejudicial question. They
argued that the civil case, which was an action for declaration
of nullity of the mortgage, should first be resolved. The RTC
granted the motion, as well as denied Concepcions MR. This
prompted Concepcions counsel to seek the nullification of the
RTC orders before the CA.
Earlier last year, Concepcion, who was a resident of
Cebu City, while on vacation in Manila, was unexpectedly
confined at the Makati Medical Center due to upper gastro-
intestinal bleeding; and was advised to stay in Manila for
further treatment. Because of this, Concepcions counsel filed a
motion to take her deposition. He explained the need to
perpetuate her testimony due to her weak physical condition
and old age, which limited her freedom of mobility. The RTC
granted the motion and directed that her deposition be taken
before the Clerk of Court of Makati City. The RTC justified that
procedural technicalities should be brushed aside because of
the urgency of the situation. Risos et al. appealed to the CA,
which rendered a Decision favorable to them. The appellate
court set aside the RTC orders and declared void any
deposition that may have been taken on the authority of such
void orders.
At the outset, the CA observed that there was a
defect in the criminal case by not impleading the People of the
Philippines, an indispensable party. This notwithstanding, it
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resolved the matter on its merit, declaring that the
examination of prosecution witnesses, as in the present case,
is governed by Section 15, Rule 119 of the Revised Rules of
Criminal Procedure (CrimPro) and not Rule 23 of the Rules of
Court (CivPro), which is applicable to civil cases. Pursuant to
the said CrimPro provision, Concepcions deposition should
have been taken before the judge or the court where the case
is pending, which is the RTC of Cebu, and not before the Clerk
of Court of Makati City; and thus, in issuing the assailed order,
the RTC clearly committed grave abuse of discretion.

Issues:
1. Does Rule 23 of CivPro apply to the deposition of
Concepcion? (main issue) - No. CrimPro squarely
applies.
2. Does the failure to implead the "People of the
Philippines" in a petition for certiorari arising from a
criminal case a quo constitute a waivable defect in the
same petition? (sub issue) Yes.

Held: The petition is denied. CA affirmed; RTC committed
grave abuse of discretion.

Ratio:
MAIN ISSUE: Pursuant to the accuseds constitutional right to
confront the witnesses face-to-face, all witnesses shall give
their testimonies during the trial of the case in the presence of
the judge. This is especially true in criminal cases so that the
accused may cross-examine the witnesses. It also gives the
parties and their counsel the chance to propound such
questions as they deem material and necessary to support
their position or to test the credibility of said witnesses. Lastly,
this rule enables the judge to observe the witnesses
demeanor. As exceptions, however, Rules 23 to 28 of the
Rules of Court (CivPro) provide for the different modes of
discovery that may be resorted to by a party to an action.
These rules are adopted either to perpetuate the testimonies
of witnesses or as modes of discovery. In criminal proceedings,
Sections 12, 13 and 15, Rule 119 (CivPro) allow the conditional
examination of both the defense and prosecution witnesses.
On whether Rule 23 (CivPro) applies to the instant
case, the answer is no. In the case at bench, in issue is the
examination of a prosecution witness, who was too sick to
travel and appear before the trial court. Such a situation,
however, is adequately and squarely covered by a specific
provision of the rules of criminal procedure (i.e. Section 15,
Rule 119
2
). Thus, Rule 23 could not be applied suppletorily.
3

Rule 119 specifically states that a witness may be conditionally
examined: 1) if the witness is too sick or infirm to appear at
the trial; or 2) if the witness has to leave the Philippines with
no definite date of returning. It is required that the conditional
examination be made before the court where the case is

2
See Section 15, Rule 119 on the examination of witness for the
prosecution. Please note that a slightly different rule exists for the
examination of witness for the defense under Section 13 of Rule 119.)
3
While it is true that Section 3, Rule 1 of the Rules of Court provides
that CivPro rules apply to all actions, civil or criminal and special
proceedings, the suppletory application of the same come into play
only in situations not adequately covered by CrimPro rules on criminal
cases.

pending. It is also necessary that the accused be notified, so
that he can attend the examination, subject to his right to
waive the same after reasonable notice. As to the manner of
examination, the Rules mandate that it be conducted in the
same manner as an examination during trial, that is, through
question and answer.
Thus, granting Concepcions motion and actually
taking her deposition in Makati City is erroneous and contrary
to the clear mandate of the Rules. There is nothing in the rule
which may be remotely interpreted to mean that such
requirement does not apply when the witness is kilometers
away, as in the present case. The court may not introduce
exceptions or conditions. Neither may it engraft into the law
(or the Rules) qualifications not contemplated. When the
words are clear and categorical, there is no room for
interpretation; there is only room for application. The Court we
cannot disregard rules which are designed mainly to protect
the accuseds constitutional rights. The giving of testimony
during trial is the general rule. The conditional examination of
a witness outside of the trial is only an exception, and as such,
calls for a strict construction of the rules. The Court finds no
necessity to depart from, or to relax, this rule, especially when
the witness testimony is crucial to the prosecutions case.

(Sub Issue: Failure to implead the "People of the Philippines" is
a waivable defect. It is undisputed that in their petition
for certiorari before the CA, the People of the Philippines was
not impleaded as a party thereto. Because of this, the petition
was obviously defective. As provided in Section 5, Rule 110
(CrimPro), all criminal actions are prosecuted under the
direction and control of the public prosecutor. Therefore, Risos
et al. should have impleaded the People of the Philippines as
respondent in the CA case to enable the Solicitor General to
comment on the petition. However, this Court has repeatedly
declared that the failure to implead an indispensable party is
not a ground for the dismissal of an action. The remedy is to
implead the non-party claimed to be indispensable. Parties
may be added by order of the court, on motion of the party or
on its own initiative at any stage of the action and/or such
times as are just. If the petitioner/plaintiff refuses to implead
an indispensable party despite the order of the court, the latter
may dismiss the complaint/petition for the
petitioners/plaintiffs failure to comply. In this case, the CA
disregarded the procedural flaw by allowing the petition to
proceed, in the interest of substantial justice. Also noteworthy
is that, notwithstanding the non-joinder of the People of the
Philippines as party-respondent, it managed, through the
Office of the Solicitor General, to file its Comment on the
petition for certiorari. Thus, the People was given the
opportunity to refute the respondents arguments.)

G. Purpose of taking Deposition

ISIDRO PAJARILLAGA vs. COURT OF APPEALS and
THOMAS KALANGEG

FACTS: Thomas Kalangeg filed with the RTC of Mt. Province a
Complaint for a Sum of Money against Isidro Pajarillaga. They
failed to reach an amicable settlement, thus trial on merits
ensued. It was Kalangeg who first presented his witness.
However, at the next scheduled hearing, neither Pajarillaga nor
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his counsel appeared despite notice. Upon Kalangegs motion,
the RTC allowed him to present his remaining witnesses
subject to Pajarillagas cross-examination on the next hearing.
However, Pajarillaga and his counsel were once again absent
on the next hearing. Upon Kalangegs motion, the RTC
declared Pajarillaga to have waived his right of cross-
examination and allowed Kalangeg to make a formal offer of
evidence. In its Order, the RTC admitted all the exhibits
formally offered by Kalangeg and scheduled Pajarillagas
presentation of evidence on Oct. 28, 29 and 30, 1997.
Pajarillaga moved to reset the hearing to Dec. 15, 1997 and
the same was granted by the RTC. However, on Dec. 10,
1997, Pajarillaga filed a Motion for Leave of Court to Take
the Deposition of Defendant Upon Written
Interrogatories on the grounds that: (a) Pajarillaga resides
in Manila which is more than 400 kms from Mt. Province; and
(b) Pajarillaga is suffering from an illness which prohibits him
from doing strenuous activities. Kalangeg opposed the motion.
On Dec. 15, 1997, neither Pajarillaga nor his counsel appeared,
but the RTC rescheduled Pajarillagas presentation of evidence
to Jan. 12, 1998. An Order was issued by the RTC Judge on
Jan. 29, 1998 denying Pajarillagas Motion. He moved for a
MR, but the RTC denied. Pajarillaga elevated the case to the
CA via Rule 65. The CA affirmed the RTCs orders denying
Pajarillagas Motion.

ISSUE: W/N the taking of Pajarillagas deposition by
written interrogatories is proper under the
circumstance obtaining in this case.

HELD/RATIO: NO. Pajarillagas Petition is Denied for
Lack of Merit.

Deposition is chiefly a mode of discovery, the
primary function of which is to supplement the
pleadings for the purpose of disclosing the real points
of dispute between the parties and affording an
adequate factual basis during the preparation for trial.
It should be allowed absent any showing that taking it would
prejudice any party. It is accorded a broad and liberal
treatment and the liberty of a party to make discovery is well-
nigh unrestricted if the matters inquired into are otherwise
relevant and not privileged, and the inquiry is made in good
faith and within the bounds of law. It is allowed as a departure
from the accepted and usual judicial proceedings of examining
witnesses in open court where their demeanor could be
observed by the trial judge, consistent with the principle of
promoting just, speedy and inexpensive disposition of every
action and proceeding; and provided it is taken in accordance
with the provisions of the Rules of Court, i.e., with leave of
court if summons have been served, and without such leave if
an answer has been submitted; and provided further that a
circumstance for its admissibility exists.
There is nothing in the Rules of Court or in
jurisprudence which restricts a deposition to the sole function
of being a mode of discovery before trial. Under certain
conditions and for certain limited purposes, it may be taken
even after trial has commenced and may be used without the
deponent being actually called to the witness stand. There is
no rule that limits deposition-taking only to the period of pre-
trial or before it; no prohibition exists against the taking of
depositions after pre-trial. There can be no valid objection to
allowing them during the process of executing final and
executory judgments, when the material issues of fact have
become numerous or complicated. Thus, there is really nothing
objectionable, per se, with petitioner availing of this discovery
measure after private respondent has rested his case and prior
to petitioners presentation of evidence. To reiterate,
depositions may be taken at any time after the institution of
any action, whenever necessary or convenient.
But when viewed vis the several postponements
made by Pajarillaga for the initial presentation of his evidence,
we are of the view that his timing is, in fact, suspect. The
records show that Pajarillaga stopped attending the hearings
after Kalangeg presented his first witness. Pajarillaga offered
no excuse for his and his counsels absences. Moreover, the
RTC has set four (4) hearing dates for the initial presentation
of his evidence. But he merely moved for its resetting without
invoking the grounds which he now presents before the SC.
Besides, even upon scrutiny of Pajarillagas arguments, the SC
thinks that he has not sufficiently shown an exceptional or
unusual case for the grant of leave and reverse the trial and
appellate courts.
Sec. 4 of Rule 23
4
of the Rules of Court provide for
instances when depositions may be used for trial or for the
hearing of an interlocutory proceeding. In this case, Pajarillaga
invokes distance and illness to avail of the discovery measure.
The SC agrees with Kalangeg that the matter of distance could
have been settled had Pajarillaga requested for a change of
venue earlier in the proceedings. Pajarillaga has attended the
pre-trial and the hearing where Kalangeg presented his first
witness. He need not await his turn to present evidence before
realizing the great inconvenience caused by the enormous
distance between his place of residence and the place of
hearing. As to Pajarillagas assertion of illness, as aptly
observed by the Court of Appeals, the medical certificate
submitted by Pajarillaga merely contained a remark that the
patient is advised to avoid strenuous activity. It was not
alleged that the travel from Manila to Mt. Province for the
scheduled hearings was too strenuous to endanger petitioners
health.

H. Letters rogatory and commissions

PFEGER, GODOFREDO, ROWENA DULAY, etc v.
RODRIGO DULAY


4
SEC. 4. Use of depositions. x x x x
(c) The deposition of a witness, whether or not a party, may
be used by any party for any purpose if the court finds: (1)
that the witness is dead; or (2) that the witness resides at a
distance more than one hundred (100) kilometers from the
place of trial or hearing, or is out of the Philippines, unless it
appears that his absence was procured by the party offering
the deposition; or (3) that the witness is unable to attend or
testify because of age, sickness, infirmity, or imprisonment;
or (4) that the party offering the deposition has been unable
to procure the attendance of the witness by subpoena; or
(5) upon application and notice, that such exceptional
circumstances exist as to make it desirable, in the interest of
justice and with due regard to the importance of presenting
the testimony of witnesses orally in open court, to allow the
deposition to be used; and x x x x
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FACTS: Rodrigo Dulay, a naturalized American citizen, alleged
in his complaint for recovery of bank deposits, that his brother
Godofredo Dulay and nephew Pfeger Dulay immigrated to the
US and stayed with him in his home in Claremont,
Massachusetts. Godofredo returned to the Philippines because
he could not endure the weather. Pfeger stayed behind to
take care of Rodrigo. Having nurtured affection for his
nephew Pfeger, Rodrigo opened a trust account with the Bank
of Boston with a deposit of $230,000.00, with Pfeger as
trustee thereof.
Five months later, Pfeger left Rodrigos house
allegedly to join his girlfriend in California. Rodrigo learned
only later that Pfeger actually went back to the Philippines. He
briefly returned to the US but returned again to
the Philippines where he went on a spending binge. Upon
knowing this, Rodrigo verified the status of his account with
the Bank of Boston, and to his shock discovered that Pfeger
had already emptied the account. Rodrigo claimed that Pfeger
used the money to buy several vehicles, loan money to several
people, open bank accounts for his siblings, and buy a house
and lot and jewelry for his wife. Whatever was left of the
account was allegedly transferred to Pfegers father,
Godofredo.
Rodrigo filed a petition for the issuance of letters
rogatory to get the depositions of several witnesses residing
abroad. Godofredo and Pfeger moved to be allowed to file
cross-examination questions to respondents written
interrogatories, which the trial court granted.
Godofredo and Pfeger filed a Motion to Dismiss the
complaint on the ground of failure to prosecute. This was
denied by the trial court (Pangasinan RTC).
It turned out, however, the depositions could not be
taken before the Clerk of Court of Massachusetts, but were
taken instead before a notary public in New York.
Thereafter, petitioners filed their Motion Reiterating Motion to
Dismiss, which was again denied by the RTC in an order. In
the same Order, trial court directed Rodrigo to have the
written and cross interrogatories taken by the notary public
authenticated by the consulate.
Godofredo and Pfeger filed an Omnibus
Motion, praying that the written interrogatories be declared
inadmissible and reiterating their prayer for the dismissal of
the complaint. RTC denied this, saying that the deposition
taken before the Notary Public from New York, whose
authority was duly certified by the Philippine Consul in New
York, substantially complied with the Rules of Court
In their appeal to the CA, Godofredo and Pfeger, the
major delays in the litigation of the case were caused by
Rodrigo;s failure to send on time the needed documents to the
trial court. CA ruled that Rodrigo could not be faulted for the
incidental delays in the proceedings, which were after all
caused by the refusal of the American tribunal (Clerk of Court
of Massachussets) which brushed aside the letters rogatory
issued by the trial court.

ISSUE: WON CA erred in denying the appeal of Godofredo
and Pfeger to declare inadmissibility of the depositions and
dismiss the case for failure to prosecuteNO

RATIO: While the letters rogatory issued by the trial court
specifically directed the Clerk of Court of Boston to take the
depositions needed in the case, it became impossible to follow
the directive since the Clerk of Court of Boston merely brushed
it aside and refused to cooperate. Rodrigo cannot be faulted
for the resultant delay brought about by this circumstance.
Neither can the trial court be faulted for allowing the admission
of the depositions taken not in strict adherence to its original
directive, nor for directing the petitioner to have the
depositions authenticated. Obviously, it was not within the trial
courts power, much less the respondents to force the Clerk of
Court of Boston to have the deposition taken before it.
In our jurisdiction, depositions in foreign countries
may be taken:
(a) on notice before a secretary of embassy or legation, consul
general, consul, vice consul, or consular agent of the Republic
of the Philippines;
(b) before such person or officer as may be appointed by
commission or under letters rogatory; or
(c) before any person authorized to administer oaths as
stipulated in writing by the parties.
While letters rogatory are requests to foreign
tribunals, commissions are directives to officials of the issuing
jurisdiction (in this case, the Phils). Generally, a commission is
an instrument issued by a court of justice, or other competent
tribunal, directed to a magistrate by his official designation or
to an individual by name, authorizing him to take the
depositions of the witnesses named therein, while a letter
rogatory is a request to a foreign court to give its aid,
backed by its power, to secure desired information.
Commissions are taken in accordance with the rules laid down
by the court issuing the commission, while in letters rogatory,
the methods of procedure are under the control of the foreign
tribunal.
Leave of court is not required when the deposition is
to be taken before a secretary of embassy or legation, consul
general, consul, vice-consul or consular agent of the Republic
of the Philippines and the defendants answer has already been
served. However, if the deposition is to be taken in a foreign
country where the Philippines has no secretary of embassy or
legation, consul general, consul, vice-consul or consular agent,
it may be taken only before such person or officer as may be
appointed by commission or under letters rogatory
Here, the authentication made by the consul was a
ratification of the authority of the notary public who took the
questioned depositions. The deposition was, in effect, obtained
through a commission, and no longer through letters rogatory.
It must be noted that this move was even sanctioned by the
trial court by virtue of its Order. With the ratification of the
depositions in issue, there is no more impediment to their
admissibility.
Besides, the allowance of the deposition can not be said to
have caused any prejudice to the adverse party. They were
given the opportunity to cross-examine the witnesses through
their cross-interrogatories, which were in turn answered by the
deponents. Save for the complaint of delay in the proceedings,
petitioners were unable to point out any injury they suffered as
a result of the trial courts action.

I. Failure to answer written interrogatories

FELISA M. JARAVATA vs. MA. DIANA KAROLUS and
GRACE V. KUHAIL,

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FACTS: Felisa Javarata filed an action for reconveyance and
declaration of nullity of titles and damages before the RTC of
Olongapo City alleging that she is the lawful owner and actual
occupant of a parcel of land situated in Cawag, Subic,
Zambales. The said lot, was consolidated with other parcels of
land and further subdivided into three lots, namely, Lot 1, Lot
2, and Lot 3. Lot 3 was thereafter titled under Felisa's name in
the OCT.
Felisa filed the said complaint claiming that as early
as 1950, she and her predecessors-in-interest have been in
actual, continuous, open, and public possession of Lots 1, 2,
and 3 in the concept of an owner. She alleged that she even
had planted and cultivated the subject parcels of land and had
declared the same for taxation purposes.
The complaint ensued when Felisa discovered that
her relatives, Diana Karolus and Grace Kuhail, fraudulently and
illegally secured titles over Lots 1 and 2. Felisa alleged that the
two, through fraud and misrepresentation, were able to obtain
a Free Patent in their names for which an OCT was issued by
the Register of Deeds. Felisa alleged that Lot 1 overlapped
with the property registered in the name of Karolus while Lot 2
overlapped with the property registered in the name of Kuhail.
Felisa asserted that the free patents issued to
respondents Karolus and Kuhail should be declared null and
void ab initio on the grounds that respondents have never
been in possession of the contested lots and that they were
never qualified to be grantees of free patents, obtained in
1988, on account of their age and citizenship.
Felisa insisted that as early as 1980 she became
owner, ipso facto and by operation of law, of the disputed
parcels of land on account of her open and continuous
possession and cultivation for more than 30 years, her
payment of taxes thereon, and her exercise of all attributes of
ownership over said properties. Hence, she alleged that the
disputed lots ceased to be part of the public domain and
beyond the authority of the Director of Lands and the DENR to
dispose of or award as free patents to third parties.
In their answer, respondents Karolus and Kuhail
claimed, that the issuance of free patents in their names was
made in accordance with law and without any fraud or
misrepresentation; that the areas covered by their OCTs do
not overlap with any area covered by Felisa's property; and
that they had been in possession of the parcels of land until
they were partially disposed by Felisa and her counsel.
Respondents also filed a third-party complaint against
Rudegelio D. Tacorda, Felisas counsel.
Felisa then served upon the respondents and their
counsel two separate and different sets of written
interrogatories. Respondents filed their objection to the written
interrogatories but the RTC denied the same. Tacorda likewise
served upon respondents separate and different sets of written
interrogatories.
Thereafter, Felisa and Tacorda filed a joint omnibus
motion primarily to compel the respondents to fully and
completely answer their written interrogatories. Respondents
however, failed to fully answer the written interrogatories both
in the principal action as well as in the third party complaint.
Hence, the RTC declared respondents in default in
accordance with Rule 29, Section 3 (c) of the ROC and
rendered judgment in favor of Felisa. The RTC declared Felisa
as the lawful and true owner of the parcels of land known as
Lot nos. 1 and 2 and declared the OCTs in the name of the
respondents, null and void.
Aggrieved, respondents filed a notice of appeal before
the CA. The CA reversed the decision of the RTC and dismissed
the complaint of Felisa. Hence, this petition.

Issues: Whether or not the CA erred in setting aside
the RTCs default judgment considering that
respondents did not fully answer the written
interrogatories served upon them. No

Held: The CA was correct in holding that the RTC erred in
rendering a judgment by default against the defendants for
refusal or failure to answer written interrogatories, without first
requiring an application by the proponent to compel an
answer. This is the requisite procedure under Section 1 of Rule
29 of the 1997 Rules of Civil Procedure.
Nevertheless, the CA erred in proceeding to decide
the case on the merits since there was as yet no trial or
presentation of evidence in the court a quo. Petitioner's prayer
to affirm the trial court's default decision does not mean that
there was a trial. The decision of the trial court was based on
constructive admissions by the defendants of the allegations of
the plaintiff due to the court's application of the sanction for
not answering the written interrogatories. In reversing the
application of the sanction, the CA should have given the
parties a chance to substantiate by evidence their respective
claims at the trial court. This is particularly true with respect to
the plaintiff's claim of physical possession for more than 30
years, regarding which the CA said that clear and convincing
evidence was required but wanting. The wrong procedure
followed by the trial court effectively aborted a trial and
presentation of evidence.
The case was therefore ordered remanded to the RTC for
trial and/or further proceedings.

J. Consequences of failure to answer
interrogatories

ZEPEDA v. CHINA BANKING CORP.

FACTS: Spouses Zepeda obtained a loan of P5.8 million from
Chinabank. The loan was secured by a REM over their parcel of
land.
The Zepedas had difficulty paying their loan
obligations so they requested for loan restructuring, which was
allegedly granted by Chinabank. Later on however, they were
surprised when Chinabank extrajudicially foreclosed the
subject property in October 2001. The spouses failed to
redeem the property and ownership wazs consolidated in the
banks favor.
So in Feb 2003, the spouses filed a complaint for
nullification of foreclosure proceedings and loan documents
with damages against CHinabank. They aver that the
foreclosure proceedings should be annulled for falure to
comply with the posting and publication requirements. They
also claim that they signed the REM and promissory note in
blank but were not given a copy, and that interest rates were
unilaterally fixed.
Chinabank filed an Answer with affirmative defenses
and counterclaim. It also filed a set of WRITTEN
INTERROGATORIES with 20 questions.
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The banks affirmative defenses were denied by the
TC and ordered the Clerk of Court to set the pre-trial
conference for marking of parties documentary evidence.
Bank filed a petition for certiorari (r65) with CA for
refusal to consider the affirmative defenses AND when
petitioners FAILED TO ANSWER the written interrogatories. CA
granted, ruled in favor of bank and dismissed the complaint.
ISSUE: W/N the complaint should be dismissed for
failure of petitioners spouses Zepeda to answer
Chinabanks written interrogatories as provided in Sec
3c of Rule 29.
HELD/RATIO: No. CA erred. Complaint should not be
dismissed for failure to answer the written
interrogatories.
It should be noted that respondent bank filed a motion to
expunge the complaint based on Section 3(c) of Rule 29 which
states:
SEC. 3. Other consequences. If any party or an
officer or managing agent of a party refuses to obey
an order made under section 1 of this Rule requiring
him to answer designated questions, or an order
under Rule 27 to produce any document or other
thing for inspection, copying, or photographing or to
permit it to be done, or to permit entry upon land or
other property, or an order made under Rule 28
requiring him to submit to a physical or mental
examination, the court may make such orders in
regard to the refusal as are just, and among others
the following:
x x x x
(c) An order striking out pleadings or parts thereof, or
staying further proceedings until the order is obeyed,
or dismissing the action or proceeding or any part
thereof, or rendering a judgment by default against
the disobedient party; and
As we have explained in Arellano v. Court of First
Instance of Sorsogon, the consequences enumerated in
Section 3(c) of Rule 29 would only apply where the party upon
whom the written interrogatories is served, refuses to answer
a particular question in the set of written interrogatories and
despite an order compelling him to answer the particular
question, still refuses to obey the order.
In the instant case, petitioners refused to
answer the whole set of written interrogatories, not
just a particular question. Clearly then, respondent
bank should have filed a motion based on Section 5 and
not Section 3(c) of Rule 29. Section 5 of Rule 29 reads:
SEC. 5. Failure of party to attend or serve answers.
If a party or an officer or managing agent of a party
willfully fails to appear before the officer who is to
take his deposition, after being served with a proper
notice, or fails to serve answers to interrogatories
submitted under Rule 25 after proper service of such
interrogatories, the court on motion and notice, may
strike out all or any part of any pleading of that party,
or dismiss the action or proceeding or any part
thereof, or enter a judgment by default against that
party, and in its discretion, order him to pay
reasonable expenses incurred by the other, including
attorneys fees.
Due to respondent banks filing of an erroneous
motion, the trial court cannot be faulted for ruling that the
motion to expunge was premature for lack of a prior
application to compel compliance based on Section 3.
The imposition of sanctions under Section 5 is within
the sound discretion of the trial court. The matter of how, and
when, the above sanctions should be applied is one that
primarily rests on the sound discretion of the court where the
case pending, having always in mind the paramount and
overriding interest of justice. For while the modes of discovery
are intended to attain the resolution of litigations with great
expediency, they are not contemplated, however, to be
ultimate causes of injustice.

K. Request for admission not answered

SIME DARBY EMPLOYEES ASSOCIATION V. NLRC

Facts:
On Oct 1995, Sime Darby Employees Association
(Union) submitted its proposal to Sime Darby
(Company) for the remaining 2 years of their then
existing CBA. The Company gave its counter-proposal,
but the parties failed to reach a mutual settlement.
The Company declared a deadlock in the negotiations
and subsequently sought the intervention of DOLE by
filing a Notice of CBA Deadlock and Request for
Preventive Mediation. The Union objected to the
deadlock and filed an opposition to the Assumption of
Jurisdiction/Certification to Arbitration.
The Company filed a Notice of Lockout on June 21,
1995 on the ground of the deadlock in the CB
negotiations and sent a Notice of Lock Out Vote to
the NCMB. On the other hand, the Union conducted
its strike vote referendum and filed its Strike Vote
Result to NCMB on July 25, 1991. On Aug 1995, the
Company declared and implemented a lockout against
all the hourly employees of its tire factory on the
ground of sabotage and work slowdown. On Sept.
1995, the Union filed a complaint for illegal lockout
before DOLE.
Meanwhile, on Oct 1995, the stockholders of the
Company approved the sale of its tire manufacturing
assets and business operations. The Company issued
a memorandum dated Oct. 20, 1995 informing all its
employees of the plan to sell the tire manufacturing
assets and operations. On Oct. 27, 1995, the
Company filed w/ DOLE a Closure and Sale of Tire
Manufacturing Operation. On Nov. 15, 1995, the
Company individually served notices of termination to
all its employees, including individual petitioners.
Because of the lockout, the employees were barred
from entering the company premises and were only
allowed to enter to get their personal belongings and
their earned benefits on Nov. 21-22, 1995. The
employees also received their separation pay and
executed individual quitclaims and releases. On Nov.
1995, the Company filed w/ DOLE a Notice of
Termination of Employees covering all its employees
in the tire manufacturing and support operations
effective Dec. 15, 1995.
In Nov. 1995, petitioners filed a complaint for illegal
dismissal before the DOLE while on Jan 1996, they
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filed a complaint for ULP. The cases for illegal
dismissal, illegal lockout and unfair labor practice
were then consolidated. Subsequently, the Company
then filed a motion to return separation pay by the
complainants pending resolution of the case. The
Labor Arbiter issued an Order in view of the Motion
requiring both parties to submit their respective
Memoranda. Instead of complying, the petitioners
filed its Memorandum of Appeal w/ an application for
TRO w/ the NLRC.
The Labor Arbiter dismissed the cases for lack of
merit. The LA found the lockout valid and legal,
justified by the incidents of continued work
slowdown, mass absences, and consistent low
production output. They also found that due process
was followed.
The NLRC affirmed en toto the decision of the Labor
Arbiter. Petitioner filed a petition for certiorari with
the CA which it dismissed.
Petitioners appeal the decision of the CA.

Issue: Whether petitioners Request for Admission should have
been granted and the evidence included therein should have
been admitted since respondents reply/objection thereto were
not made under oath

Held: No. Petition dismissed.
A request for admission is a remedy provided by Rule
26 of the Rules of Court, which allows a party to file
and serve upon any other party a written request for
the admission of: (i) the genuineness of any material
and relevant document described in and exhibited
with the request; or (ii) the truth of any material and
relevant matter of fact set forth in the request. Said
request must be answered under oath within the
period indicated in the request, otherwise the matters
of which admission were requested should be deemed
admitted. Petitioners claim that respondents, instead
of filing an answer under oath, filed an unsworn
reply/objection thereto. Thus, the admissions should
be deemed admitted in their favor.
Petitioners Request for Admission does not fall under
Rule 26 of the Rules of Court. A review of said
Request for Admission shows that it contained
matters which are precisely the issues in the
consolidated cases, and/or irrelevant matters; for
example, the reasons behind the lockout, the
companys motive in the CBA negotiations, lack of
notice of dismissal, the validity of the release and
quitclaim, etc.
Rule 26 as a mode of discovery contemplates of
interrogatories that would clarify and tend to shed
light on the truth or falsity of the allegations in a
pleading. That is its primary function. It does not
refer to a mere reiteration of what has already been
alleged in the pleadings.
Otherwise stated, petitioner's request constitutes "an
utter redundancy and a useless, pointless process
which the respondent should not be subjected to."
The rule on admission as a mode of discovery is
intended "to expedite trial and to relieve parties of
the costs of proving facts which will not be disputed
on trial and the truth of which can be ascertained by
reasonable inquiry." Thus, if the request for admission
only serves to delay the proceedings by abetting
redundancy in the pleadings, the intended purpose
for the rule will certainly be defeated.
More importantly, well-settled is the rule that
hearings and resolutions of labor disputes are not
governed by the strict and technical rules of evidence
and procedure observed in the regular courts of law.
Technical rules of procedure are not applicable in
labor cases, but may apply only by analogy or in a
suppletory character, for instance, when there is a
need to attain substantial justice and an expeditious,
practical and convenient solution to a labor problem.
In view of the nature of the matters requested for
admission by the petitioners, their request for
admission would have only served to delay the
proceedings.

L. Matters covered by a request for admission

DBP v. CA

Petitioner: Development Bank of the Philippines
Respondent: CA and Rosalinda Canadalla-Go, represented by
her Atty-in-fact Benito A. Canadalla

FACTS: Irene Canadalla obtained a loan of P100,000 from
petitioner DBP for purposes of financing her piggery business.
As security, Canadalla executed a Deed of Real Estate
Mortgage over two parcels of land. Canadalla again obtained
another loan of P150,000, which was secured by a mortgage
over the same two parcels of land and a third parcel. Canadalla
failed to comply with her obligations to DBP so DBP
extrajudicially foreclosed the mortgages. The mortgaged
properties were sold at public auction to the DBP, which
emerged as the only bidder.
Canadalla was able to redeem one of the foreclosed
properties but failed to redeem the others since they could not
agree on the redemption price. Irene Canadalla allegedly later
assigned her right to redeem her properties to her daughter,
private respondent Rosalinda Canadalla-Go. When Go failed to
redeem the properties, the DBP consolidated its titles over the
subject properties and new certificates of title were issued in
its name.
Go filed with the RTC of Makati City a Supplemental
Complaint

for the "Exercise of Right of Redemption and
Determination of Redemption Price, Nullification of
Consolidation, Annulment of Titles, with Damages, Plus
Injunction and Temporary Restraining Order." After the DBP
filed its Answer but before the parties could proceed to trial,
Go filed a Request for Admission by Adverse Party. Thereafter,
the DBP filed its Comment.
During the hearing, Go objected to the Comment
reasoning that it was not under oath as required by Section 2,
Rule 26 of the Rules of Court, and that it failed to state the
reasons for the admission or denial of matters for which an
admission was requested. For its part, the DBP manifested
that, first, the statements, allegations, and documents
contained in the Request for Admission are substantially the
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same as those in the Supplemental Complaint; second, they
had already been either specifically denied or admitted by the
DBP in its Answer; and third, the reasons for the denial or
admission had already been specifically stated therein.
RTC issued an Order granting the motion of Go to
consider as impliedly admitted the matters sought to be
admitted in the Request for Admission and all those denied by
the DBP in its Comment.
DBP filed with the CA a petition forcertiorari
attributing to the court a quo grave abuse of discretion in
granting the Request for Admission despite the fact that (1)
some of the matters assigned in the Request for Admission
had already been specifically denied in its Answer to the
Supplemental Complaint; (2) the sworn statement of Atty.
Caraan (one the legal counsels of DBP) had sufficiently cured
the alleged defect of the Comment; (3) some of the matters in
the Request for Admission involved questions of law,
conclusions of facts, and matters of opinion which are
improper subjects of such a request.
The CA dismissed the petition for lack of merit.

ISSUE: Whether matters requested to be admitted under Rule
26 of the Rules of Court which are mere reiterations of the
allegations in the complaint and are specifically denied in the
answer may be deemed impliedly admitted on the ground
that the response thereto is not under oath NO!

HELD: The Court finds for DBP.
Indeed, as pointed out by the DBP, the matters
stated in Gos Request for Admission are the same as those
alleged in her Supplemental Complaint. Besides, they had
already been either specifically denied or admitted in DBPs
Answer to the Supplemental Complaint. To require the DBP to
admit these matters under Rule 26 of the Rules of Court would
be pointless and superfluous.
The Court held in Po v. CA that "[a] party should not
be compelled to admit matters of fact already admitted by his
pleading and to make a second denial of those already
denied in his answer to the complaint." It further stated in
Concrete Aggregates Co. v. CA that if the factual allegations in
the complaint are the very same allegations set forth in the
request for admission and have already been specifically
denied or otherwise dealt with in the answer, a response to
the request is no longer required. It becomes unnecessary to
dwell on the issue of the propriety of an unsworn response to
the request for admission. The reason is obvious. A request for
admission that merely reiterates the allegations in an earlier
pleading is inappropriate under Rule 26 of the Rules of Court,
which, as a mode of discovery, contemplates of interrogatories
that would clarify and tend to shed light on the truth or falsity
of the allegations in the pleading. Rule 26 does not refer to a
mere reiteration of what has already been alleged in the
pleadings.
Hence, the DBP did not even have to file its Comment
on Gos Request for Admission, which merely reproduced the
allegations in her complaint. DBPs Answer itself controverts
the averments in the complaint and those recopied in the
request for admission.
Even assuming that a reply to the request is needed,
it is undisputed that the DBP filed its Comment either
admitting or specifically denying again the matters sought to
be admitted and stating the reasons therefor. That the
Comment was not under oath is not a substantive, but merely
a formal, defect which can be excused in the interest of justice
conformably to the well-entrenched doctrine that all pleadings
should be liberally construed as to do substantial justice. The
filing of such Comment substantially complied with Rule 26.
Consequently, the DBP cannot be deemed to have impliedly
admitted the matters set forth in the Request for Admission for
the mere reason that its Comment was not under oath.
The Court of Appeals also erred in ruling that the DBP
failed to timely raise its objections to the impropriety of the
matters requested for admission.
At the time Go made use of discovery proceedings
under Rule 26, the governing rule before its amendment took
effect on 1 July 1997 read: "Objections on the ground of
irrelevancy or impropriety of the matter requested shall be
promptly submitted to the court for resolution."
Petitioner DBPs objection to the impropriety of some
of the matters requested was promptly made as early as the
filing of its comment on the request for admission. DBPs
comment consistently averred that it had already dealt with
the matters in question in its answer, either admitting or
specifically denying them. Moreover, during the hearing, the
counsel for DBP manifested the foregoing in open court. In so
doing, the DBP, in effect, argued that the matters in question
are redundant and, therefore, improper subjects for admission.

M. Request for admission instead of Offer to
Stipulate

MANZANO V DESPABILADERAS

FACTS: In 1989, respondent Luz Despabiladeras obtained on
credit from petitioner Roger Manzano various construction
materials, which she used in her construction project at the
Camarines Sur Polytechnic Colleges (CSPC). Petitioner claims
that the materials costs around P307K of which only P130K
was paid by respondent despite payment by CSPC for the
project. Petitioner filed a sum of money claim with damages in
the RTC of Iriga City, in her answer with counterclaim
respondent alleged that petitioner substantially altered the cost
of materials and that she made additional payments via two
checks (+P57K). In his reply, petitioner alleges that the
checks represented payment for other obligations.
The issues were joined and in the pre-trial, both
parties agreed that petitioner shall make an offer to
stipulate to respondent to determine the cost of the materials
in dispute and the latter will state her comment or objections.
Instead of making an offer to stipulate, petitioner filed a
request for admission asking respondent to admit within 15
days that (1. That respondent received the materials from
petitioner and 2. Of the P307K, only P130K was paid by
respondent). Respondent did not answer. RTC ordered the
requested facts be admitted confirmed and later on ruled in
favor of petitioner. CA set aside the decision of the RTC

ISSUE: What is the legal consequence when a request for
admission of material and relevant facts pursuant to Rule 26 is
not answered under oath within the period stated in the Rules
by a party litigant served therefore?

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HELD: It is deemed to have been admitted. The agreement of
the parties during the pre-trial conference was that "the
petitioner shall submit an offer to stipulate showing an
itemized list of construction materials delivered to the
respondent together with the cost claimed by the petitioner
within fifteen 15 days furnishing copy thereof to the
respondent who will state her objections if any, or comment
thereon within the same period of time." In substantial
compliance with said agreement, petitioner chose to instead
file a request for admission, a remedy afforded by a party
under Rule 26.
Respondent having failed to discharge what is
incumbent upon her under Rule 26, that is, to deny under oath
the facts bearing on the main issue contained in the "Request
for Admission," she was deemed to have admitted that she
received the construction materials, the cost of which was
indicated in the request and was indebted to petitioner in the
amount of P184,610.50 (P314,610.50 less the partial payment
of P130,000.00).
During the trial, however, petitioner admitted that aside from
the P130,000.00 partial payment, he had received a total
of P122,000.00 (P97,000.00 plus P25,000.00). Respondent
thus had a remaining balance of P62,610.50.
N. Failure to respond to a request for Admission

LIMOS, DELOS REYES AND SPOUSES DELOS REYES V
SPOUSES ODONES

FACTS: Spouses Odones (Spouses) filed a complaint for
Annulment of Deed, Title and Damages against petitioners
Limos, Delos Reyes and Spouses Delos Reyes because they
allegedly owned a parcel of land by virtue of an Extrajudicial
Succession of Estate and Sale executed by the surviving
grandchildren and heirs of Donata Lardizabal. They delayed
registering the document of conveyance and found that the
OCT was cancelled and replaced by TCT in the name of the
petitioners. Limos et al allegedly purchased it from Donata
Lardizabal and her husband Razalan. They then subdivided the
lot among themselves and had 3 new TCTs issued.
Spouses sought the cancellation of these new TCTs on the
ground that the signatures of Lardizabal and Razalan in the
Deed of Absolute Sale were forgeries. Limos et al filed a
Motion for Bill of Particulars claiming ambiguity in respondents
claim that their vendors are the only heirs of Donata
Lardizabal. TC denied.
In their answer, Limos et al pleaded affirmative defenses,
which also constitute grounds for dismissal of the complaint.
These grounds were: (1) failure to state a cause of action
since title is void because the Extrajudicial Succession of Estate
and Sale was not published and it contained formal defects,
the vendors are not the legal heirs of Lardizabal, and Spouses
Odones are not the real parties-in-interest; (2) non-joinder of
the other heirs of Lardizabal as indispensable parties; and (3)
Spouses claim is barred by laches.
In their Reply, the Spouses denied the foregoing affirmative
defenses and appended the sworn statement of Amadeo
Razalan denying he ever sold the property to the petitioners
nor was he the heir of Lardizabal.
Limos et al filed a Request for Admission reiterating the
issues in their affirmative defense. Spouses Odones failed to
respond to the Request so petitioners filed a Motion to Set for
Preliminary Hearing on the Special and Affirmative Defenses,
arguing that failure to respond or object to the Request
amounted to an implied admission pursuant to Section 2 of
Rule 26 of the Rules of Court. Spouses filed a comment
contending that the facts sought to be admitted were not
material and relevant to the issue of the case as required by
Rule 26 of the Rules of Court. They emphasized that the only
issue was whether the 1972 Deed of Absolute Sale upon which
Limos et al base their TCTs is valid. RTC denied Limos et als
motion for items 1-4 were already pleaded in their affirmative
defense while items 5-7 were effectively denied by the
Extrajudicial Succession of Estate and Sale appended to the
complaint and by the Sinumpaang Salaysay of Amadeo
Razalan.
Limos et al filed petition for certiorari to CA. CA dismissed.
Now filed MR with SC.

ISSUE: Did the Spouses impliedly admit the affirmative
defenses of Limos et al by failing to respond to the Request
resulting to holding of the preliminary hearing?

HELD: NO! The matters in the Request for Admission were the
same affirmative defenses pleaded in their Answer which the
Spouses already denied in their Reply. The said defenses were
also controverted in the complaint and its annexes. A request
for admission is not intended to merely reproduce or reiterate
the allegations of the requesting partys pleading but should
set forth relevant evidentiary matters of fact described in the
request, whose purpose is to establish said partys cause of
action or defense. Unless it serves that purpose, it is pointless,
useless, and a mere redundancy.
The rules on modes of discovery in Sections 1 and 2 of Rule 26
of the Rules of Court, provide:
Section 1. Request for admission. At any time after issues
have been joined, a party may file and serve upon any other
party a written request for the admission by the latter of the
genuineness of any material and relevant document described
in and exhibited with the request or of the truth of any
material and relevant matter of fact set forth in the request.
Copies of the documents shall be delivered with the request
unless copies have already been furnished.
SEC. 2 Implied admission. Each of the matters of which an
admission is requested shall be deemed admitted unless,
within a period designated in the request, which shall be not
less than fifteen (15) days after service thereof, or within such
further time as the court may allow on motion, the party to
whom the request is directed files and serves upon the party
requesting the admission a sworn statement either denying
specifically the matters for which an admission is requested or
setting forth in detail the reasons why he cannot truthfully
either admit or deny those matters.
x x x x
Under these rules, a party who fails to respond to a Request
for Admission shall be deemed to have impliedly admitted all
the matters contained therein. It must be emphasized,
however, that the application of the rules on modes of
discovery rests upon the sound discretion of the court.

O. Amparo Rule likened to Production Order

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SECRETARY OF NATIONAL DEFENSE, AFP, CHIEF OF
STAFF VS MANALO

FACTS: In Feb 2006, members of the CAFGU summoned to a
meeting all the residents of their barangay in San Idelfonso,
Bulacan but the MANALOs (Raymond and Reynaldo) were not
able to attend coz they werent informed. When RAYMOND
was sleeping in their house, several armed soldiers entered the
house looking for a certain Bestre. Even though mother of
Raymond said he was not Bestre, RAYMOND was slapped,
handcuffed, kicked and forced him to enter a van (Raymond
recognized the people as CAFGU members). Raymond was
blindfolded and beaten up inside the van. RAYMOND was
brought to a house and there was continuously interrogated if
he was a NPA member and asked where his comrades are.
Each time he answered that he is not, they hit him. Raymond
was detained for 18 months where he was transferred to
different camps.
[Note: The rest of the facts stated of how Raymond lived while
being detained, how his brother Reynaldo was brought in as
well as other detainees, how they were first tortured, nursed
back to health then tortured again, how they were allowed to
go out and work within the camps, how they saw the CAFGU
soldiers kill NPA, how they planned their escape]

Basically MANALOs were abducted and detained for 18
months!

Eventually, MANALOs and other detainees were able to escape
(when the guards were sleeping after a drinking session) and
subsequently filed a petition for prohibition, injunction and
TRO against SECRETARY OF NATIONAL DEFENSE, AFP, and
CHIEF OF STAFF (MILITARY) to stop them and/or their agents
from depriving MANALOs of their right to liberty and other
basic rights and other ancillary remedies. While the case was
pending, the Rule on the Writ of Amparo took effect
on October 24, 2007. MANALOs sought to have their petition
be considered Petition for the Writ of Amparo, which the SC
granted and remanded the case to the CA. The CA granted the
privilege of the writ of amparo and ordered MILITARY to
furnish the MANALOs and the court with: (reliefs granted by
CA)
1. all official and unofficial investigations reports as to
the MANALOs custody, except those already in file
with the court,
2. confirm the present places of official assignment of
two military officials involved, and
3. produce all medical reports and records of the
MANALOs while under military custody. MILITARY
appealed to SC seeking to reverse and set aside CA
decision.

ISSUE: (In relation to topic) MILITARY argues that the reliefs
granted by the CA (see numbered list above).

RATIO:
The Court promulgated the Amparo Rule in light of the
prevalence of extralegal killing and enforced disappearances.
The writ of amparo serves both preventive and curative roles
in addressing the problem of extralegal killings and enforced
disappearances. It is preventive in that it breaks the
expectation of impunity in the commission of these offenses; it
is curative in that it facilitates the subsequent punishment of
perpetrators as it will inevitably yield leads to subsequent
investigation and action.

IN relation to topic:
With respect to the first and second reliefs,
MILITARY argue that the production order sought by
respondents partakes of the characteristics of a search
warrant
5
. Thus, they claim that the requisites for the issuance
of a search warrant must be complied with prior to the grant
of the production order. But since MANALOs allegations are
self-serving without supporting details, it does not qualify as
such. SC held this to be invalid.
The production order under the Amparo Rule
should not be confused with a search warrant for law
enforcement under Article III, Section 2 of the 1987
Constitution. This Constitutional provision is a
protection of the people from the unreasonable
intrusion of the government, not a protection of the
government from the demand of the people such as
respondents. The amparo production order may be
likened to the production of documents or things under
Section 1, Rule 27
6
of the Rules of Civil Procedure.

Not so Impt
With respect to the second and third reliefs, MILITARY
assert that the disclosure of the present places of assignment
of the military officers and submission of medical list is
unnecessary in the resolution of the petition for a writ
of amparo. But SC held that since the officers are both directly
implicated in the abduction and detention, it is relevant n
ensuring the safety of MANALOs that these military officers can
be served with notices and court processes in relation to any
investigation and action for violation of the MANALOs rights.
The list of medical personnel is also relevant in securing
information to create the medical history of MANALOs and
make appropriate medical interventions, when applicable and
necessary.

FOR REFERENCE: Production Order Provisions in
Amparo


5
(1) the application must be under oath or affirmation;
(2) the search warrant must particularly describe the place to be
searched and the things to be seized;
(3) there exists probable cause with one specific offense; and
(4) the probable cause must be personally determined by the judge
after examination under oath or affirmation of the complainant and the
witnesses he may produce.
6
Section 1. Motion for production or inspection order.
Upon motion of any party showing good cause
therefor, the court in which an action is pending may (a)
order any party to produce and permit the inspection and
copying or photographing, by or on behalf of the moving
party, of any designated documents, papers, books of
accounts, letters, photographs, objects or tangible things,
not privileged, which constitute or contain evidence material
to any matter involved in the action and which are in his
possession, custody or control

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SEC. 14. Interim Reliefs. Upon filing of the petition or at
anytime before final judgment, the court, justice or judge may
grant any of the following reliefs:
(a) Temporary Protection Order. The court, justice or
judge, upon motion or motu proprio, may order that the
petitioner or the aggrieved party and any member of the
immediate family be protected in a government agency or by
an accredited person or private institution capable of keeping
and securing their safety. If the petitioner is an organization,
association or institution referred to in Section 3(c) of this
Rule, the protection may be extended to the officers involved.
The Supreme Court shall accredit the persons and private
institutions that shall extend temporary protection to the
petitioner or the aggrieved party and any member of the
immediate family, in accordance with guidelines which it shall
issue.
The accredited persons and private institutions shall comply
with the rules and conditions that may be imposed by the
court, justice or judge.

(c) Production Order. The court, justice or judge, upon verified
motion and after due hearing, may order any person in
possession, custody or control of any designated documents,
papers, books, accounts, letters, photographs, objects or
tangible things, or objects in digitized or electronic form, which
constitute or contain evidence relevant to the petition or the
return, to produce and permit their inspection, copying or
photographing by or on behalf of the movant.
The motion may be opposed on the ground of national security
or of the privileged nature of the information, in which case
the court, justice or judge may conduct a hearing in chambers
to determine the merit of the opposition.
The court, justice or judge shall prescribe other conditions to
protect the constitutional rights of all the parties.

P. Documents to be produced should be described
with particularity

SOLIDBANK CORPORATION VS GATEWAY
ELECTRONICS CORPORATION

FACTS GATEWAY obtained a loan from SOLIDBANK, covered
by promissory notes. As a security for said loan, GATEWAY
assigned to Solidbank the proceeds of its Back-end Services
Agreement with Alliance Semiconductor (ALLIANCE).
GATEWAY failed to pay. When demands to pay were
unheeded, SOLIDBANK filed a complaint for collection of a sum
of money. A motion for production and Inspection of
Documents was filed on the basis of information
received from ALLIANCE that GATEWAY had already
received from ALLIANCE payment for the Back-end
Agreement. RTC granted the motion was. Gateway presented
the invoices representing the billings sent by Gateway to
Alliance in relation to the Back-end Services Agreement.
Unsatisfied with the documents produced by GATEWAY,
SOLIDBANK filed a motion to cite the former in contempt for
refusal to produce documents. GATEWAY opposed saying they
complied with the Order. RTC denied Motion but the court
reprimanded GATEWAY for not exerting diligent efforts to
produce the documents and thereafter, pronounced as
established, documents not produced by GATEWAY. CA
nullified the ruling of the trial court. It ruled that both the
Motion for Production of Documents and the of the trial court
failed to comply with the provisions of Section 1, Rule 27 of
the Rules of Court. It further held that the trial court
committed grave abuse of discretion in ruling that the matters
regarding the contents of the documents sought to be
produced but which were not produced by Gateway shall be
deemed established in accordance with Solidbanks claim.

ISSUE W/N SOLIDBANKs Motion for Production and Inspection
complies with the Rules of Court. NO.

HELD

Section 1, Rule 27 of the Rules of Court provides the
mechanics for the production of documents and the inspection
of things during the pendency of a case. It also deals with the
inspection of sources of evidence other than documents, such
as land or other property in the possession or control of the
other party. The purpose of the statute is to enable a party-
litigant to discover material information which, by reason of an
opponent's control, would otherwise be unavailable for judicial
scrutiny, and to provide a convenient and summary method of
obtaining material and competent documentary evidence in the
custody or under the control of an adversary. It is a further
extension of the concept of pretrial. Rule 27 of the Revised
Rules of Court permits fishing for evidence, the only
limitation being that the documents, papers, etc., sought to be
produced are not privileged, that they are in the possession of
the party ordered to produce them and that they are material
to any matter involved in the action. Mutual knowledge of all
relevant facts gathered by both parties is essential to proper
litigation either party may compel the other to disgorge
whatever facts he has in his possession.
In this case, GATEWAY assigned to SOLIDBANK the
proceeds of its Back-end Services Agreement with Alliance and
by virtue of the assignment, GATEWAY was obligated to remit
to SOLIDBANK all payments received from ALLIANCE.
Solidbank was able to show good cause for the production of
the documents and why these are material to the action.
However, the motion was fatally defective because of its
failure to specify with particularity the documents it
required Gateway to produce. Since the motion for
production and inspection of documents called for a blanket
inspection. SOLIDBANKs request for inspection of "all
documents pertaining to, arising from, in connection with or
involving the Back-end Services Agreement" was simply too
broad and too generalized in scope.
SC held that a motion for production and inspection
of documents should not demand a roving inspection of a
promiscuous mass of documents. The inspection should be
limited to those documents designated with sufficient
particularity in the motion, such that the adverse party can
easily identify the documents he is required to produce

OTHER NOTES:
The requisites in order that a party may compel the
other party to produce or allow the inspection of
documents or things (according to Security Bank vs
CA)
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(a) The party must file a motion for the production or
inspection of documents or things, showing good cause
therefor;
(b) Notice of the motion must be served to all other parties of
the case;
(c) The motion must designate the documents, papers, books,
accounts, letters, photographs, objects or tangible things
which the party wishes to be produced and inspected;
(d) Such documents, etc., are not privileged;
(e) Such documents, etc., constitute or contain evidence
material to any matter involved in the action, and
(f) Such documents, etc., are in the possession, custody or
control of the other party



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RULES 30-32: TRIAL, TRIAL BY
COMMISSIONERS, HEARINGS AND
CONSOLIDATION OF CASES

LOURDES DE CASTRO V. CRISPINO DE CASTRO

FACTS: The court granted Crispino de Castros petition
for nullity of marriage, on the ground of psychological
incapacity after Lourdes (his wife) failed to file an
answer. Lourdes filed a motion for leave to file an
omnibus motion seeking a new trial or reconsideration
alleging that she was misled and prevented from
participating in the annulment case because Crispino
promised support for their children. TC granted the
omnibus motion and conducted hearings. However,
when Lourdes was to present her first witness on July
17, 2002 the trial court had to reset the hearing
because there was no return of the notice sent. The
trial court reset the hearings 12 more times after that.
On Aug 20, 2003 the trial court denied Lourdes
request to cancel the hearing due to unavailability of
witness. TC deemed to have waived her right to
present evidence due to failure to present evidence on
that day. On Dec. 12, 2003 the court denied Lourdes
request to reconsider the denial claiming her absence
were justifiable with no intent to delay proceedings.
Lourdes filed a petition for certiorari under Rule 65
which CA denied. In this petition, Lourdes claims that
CA erred in ruling that Judge Umali did not commit
grave abuse of discretion in ruling that she waived her
right to present further evidence when she failed to
appear at the Aug 20 hearing.

ISSUE: Whether TC lower courts erred in ruling that
she waived her right to present further evidence when
she failed to appear at the August 20, 2003 hearing

HELD: NO
A motion for postponement based on a case that is not
unavoidable or one that could not have been foreseen
may be properly denied by the trial court; Case at Bar.
In the case at bar, petitioners excuse that
she was still in the U.S. taking care of her newborn
grandchild, while her witness, Dr. Maria Cynthia
Ramos-Leynes, who conducted a psychiatric evaluation
on her, was likewise out of the country, attending a
conventionwas unjustified. These reasons were
not unavoidable and one that could not have
been foreseen. The date of the trial was set one
month prior, and as of July 25, 2003, petitioner was in
the U.S. Certainly, petitioner would know in advance if
she could make it to the August 20, 2003 hearing.
Likewise, attending a convention is a scheduled event,
also something known in advance. It is the basic duty
of a litigant to move for postponement before the day
of the hearing, so that the court could order its
resetting and timely inform the adverse party of the
new date. This was not the case at bar for the subject
motion was presented only on the day of the trial
without any justification. We thus hold that the trial
court did not abuse its discretion in denying the motion
for postponement.


ZULUETA V. ASIA BREWERY

FACTS:
- Respondent Asia Brewery, Inc., is engaged in the
manufacture, the distribution and sale of beer;
while Petitioner Perla Zulueta is a dealer and an
operator of an outlet selling the formers beer
products. A Dealership Agreement governed their
contractual relations.
- Zulueta filed a complaint in the Iloilo RTC for
breach of contract, specific performance and
damages against Asia Brewery for alleged violation
of their Dealership Agreement.
- Asia Brewery, while to case in Iloilo was pending,
filed a complaint in the Makati RTC against Zulueta
for collection of sum of money for unpaid beer
products bought by the latter.
- Zulueta moved to dismiss the case in Makati based
on splitting a cause of action and violation against
multiplicity of suits but was denied. Later on, he
moved that the case in Iloilo and Makati be
consolidated. The consolidation was granted.
- Asia Brewery appealed via certiorari. CA ruled in
favor of Asia Brewery and set aside the order to
consolidate saying that there is no common issue
of law or fact between the two cases since the
Iloilo case was about the alleged violation of the
dealership agreement while the Makati case was
about the debt of Zulueta for unpaid beer
products. Hence, this petition.

ISSUE: W/N consolidation is proper.

HELD/RATIO: YES.
Zuluetas obligation to pay for the beer products
delivered by respondent can exist regardless of an
alleged breach in the Dealership Agreement. However,
this obligation and the relationship between
respondent and petitioner, as supplier and distributor
respectively, arose from the Dealership Agreement
which is the subject of inquiry in the Iloilo case. In
fact, petitioner herself claims that her obligation to pay
was negated by respondents contractual breach. In
other words, the non-payment -- the res of the Makati
case -- is an incident of the Iloilo case.
The issues in both civil cases pertain to the
respective obligations of the same parties under the
Dealership Agreement. Thus, every transaction as well
as liability arising from it must be resolved in the
judicial forum where it is put in issue. The
consolidation of the two cases then becomes
imperative to a complete, comprehensive and
consistent determination of all these related issues.
Two cases involving the same parties and
affecting closely related subject matters must be
ordered consolidated and jointly tried in court, where
the earlier case was filed. The consolidation of cases
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is proper when they involve the resolution of common
questions of law or facts.

[The SC said that there should have been outright
dismissal of the petition for certiorari of Asia Brewery
since it was filed out of time (nag-retroact yung 60-
day period, akala nila e 90 days pa rin to file a petition
for certiorari). Tapos retained counsel lang ang nag-
sign nung CNFS. And finally, wala daw explanation why
registered mail and not personal service ang ginamit to
serve the petition for certiorari sa counsel ni Zulueta.]


SPOUSES YU AND LEYTE LUMBER YARD &
HARDWARE CO., INC. V. BASILIO MAGNO
CONSTRUCTION AND DEVELOPMENT
ENTERPRISES AND THE ESTATE OF BASILIO
MAGNO

Facts: Spouses Roque Yu, Sr. and Asuncion Yu
(spouses Yu) are controlling stockholders of Leyte
Lumber, a business engaged in the sale of lumber,
building and electrical supplies and other construction
materials. Engr. Basilio Magno (Magno) entered into a
verbal agreement with Leyte Lumber through Roque.
Leyte Lumber agreed to supply Magno with building
materials he may need in his construction business.
Magno's business later became Basilio G. Magno
Construction and Development Enterprises, Inc. (BG
Magno).
Subsequently, Roque and Magno entered into a
joint venture, the Great Pacific Construction Company
(GREPAC), with Yu as President and Magno as Vice
President. The relationship between Yu and Magno
continued until Magno's death in 1978.
In 1979, the spouses Yu and Leyte
Lumber instituted two separate complaints for sums of
money with damages and preliminary attachment
against BG Magno and the estate of Magno
(estate). One was Civil Case No. 5822, instituted by
Leyte Lumber against BG Magno and the estate, to
collect on the principal amount of P1,270,134.87 for
construction materials claimed to have been obtained
on credit by BG Magno. The other was Civil Case No.
5823, filed by the Yu spouses against BG Magno and
the estate, to collect upon loans and advances
amounting to P3,575,000.00 allegedly made by the
spouses to BG Magno.
Civil Case No. 5822 was raffled to RTC Branch
8. The Court rendered a decision in favor of BG Magno
and the estate, dismissing the complaint and ordered
both Spouses Yu and Leyte Lumber to return the
overpayment of P620,239.61 of BG Magno. On the
same day, the RTC Branch 6, in Civil Case No. 5823,
rendered a decision in favor BG Magno and the estate,
dismissing the complaint and ordered both Spouses Yu
and Leyte Lumber to return the overpayment of
P1,602,625.52, damages, attorneys fees and litigation
expenses.
The two separate decisions were penned by
Judge Francisco, the presiding judge of Branch 6 to
which only Civil Case No. 5823 was raffled. The parties
did not move for a reconsideration of the two decisions
nor did they call the attention of Judge Francisco on
the absence of an order for consolidation of the two
cases. Instead, they directly interposed their
respective appeals to the CA.
In the CA, the two cases were consolidated. CA
modified the decision of the RTC in Civil Case No. 5822
but reversed the decision in Civil Case No. 5823,
ordering B.G. Magno to pay the Spouses Yu and Leyte
Lumber P625,000.00 plus attorneys fees and cost of
suit. The spouses Yu filed an MR. CA denied the
motion, hence the the present petition for review
under Rule 45 to set aside the CA decision.

Issues: 1. W/N it was proper for Judge Francisco of
Branch 6 to render a decision in a case filed and heard
in Branch 8, in the absence of a motion or order of
consolidation of the two cases? Yes, it was proper.
2. W/N Branch 6 could consider the evidence
presented in Branch 8? Yes, it could since there was
consolidation of both cases.

Held and Ratio:
1. There was nothing irregular in procedure taken by
Judge Francisco of Branch 6 in formulating the decision
in Civil Case No. 5822 which was pending and tried in
Branch 8. The records show that there had been a
previous agreement to either transfer or consolidate
the two cases for decision by judge Francisco of Branch
6.
As early as six months prior to the
promulgation of Judge Franciscos decisions in the two
cases, there appears to have been a transfer or
consolidation of said cases in Branch 6 and the parties
knew of it, albeit the actual date when the two cases
were consolidated or transferred does not appear on
record. Nonetheless, the fact remains that no
opposition or objection in any manner was registered
by either of the parties to the same, thereby evincing
their consent thereto. SC cited several instances: i.e.
when BG Magno and the estate filed a Motion to Lift,
Dissolve and Quash the Writs of Attachment with
Branch 6, the caption thereof indicated the docket
numbers of both cases; when the longstanding counsel
of both spouses Yu and Leyte Lumber filed his Motion
to Withdraw as Counsel and when their new counsel
entered his Formal Appearance, in the caption thereof
was also written the docket numbers of both cases. It
is, therefore, already too late in the day for both
spouses Yu and Leyte Lumber to question the
competence of Judge Francisco to render the separate
decisions in the two cases.

2. Consolidation by Branch 6 was proper. A court may
order several actions pending before it to be tried
together where they arise from the same act, event or
transaction, involve the same or like issues, and
depend largely or substantially on the same evidence,
provided that the court has jurisdiction over the case
to be consolidated and that a joint trial will not give
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one party an undue advantage or prejudice the
substantial rights of any of the parties. Moreover,
consolidation of actions is expressly authorized under
Section 1, Rule 31 of the Rules of Court.
1

The obvious purpose of the above rule is to
avoid multiplicity of suits, to guard against oppression
and abuse, to prevent delays, to clear congested
dockets, to simplify the work of the trial court; in short
the attainment of justice with the least expense and
vexation to the parties litigants.
Consolidation of actions is addressed to the
sound discretion of the court, and its action in
consolidating will not be disturbed in the absence of
manifest abuse of discretion. Here, Judge Francisco did
not abuse his discretion in ordering the joint trial of the
two cases: the two cases were filed just a few months
apart; they involve simple cases of collection of sums
of money between identical parties and no other; the
respondents (BG Magno and the estate, as defendants
therein) claim, in both cases, essentially the same
defense, which is overpayment; they cover the same
period of transacting continuous business that spans
four years; they relate to simple issues of fact that are
intimately related to each other; they entailed the
presentation of practically identical evidence and
witnesses; in fact, a broad part of the evidence and
testimonies in one case was totally adopted or
reproduced in the other by either or both parties. And
the trial court, being multi-sala courts, its Branches 6
and 8 possessed jurisdiction to try either or both cases
on their own.
Likewise, it became apparent that, after the
commissioner filed his reports (in Civil Case No. 5822)
in the Court and the parties their comments thereto,
but before trial could commence, the claims and
defenses of the parties in Civil Case No. 5823 are
covered by and may be threshed out by a
consideration of the evidence presented in Civil Case
No. 5822 as well, which consisted mainly of the reports
of the commissioner. Based on the commissioners
reports in the case pending in Branch 8 (Civil Case No.
5822), the spouses Yu and Leyte Lumbers claims,
including those in Branch 6, appear to have been paid;
indeed, this is in essence the defense of the BG Magno
and the estate as set forth in their Answers to
the two complaints. Yet, despite all these, neither of
the lawyers for the parties sought a consolidation of
the two cases, which would otherwise have been
mandatory.
Having given their assent to the consolidation
of Civil Case Nos. 5822 and 5823, the evidence in each
case effectively became the evidence for both, and
there ceased to exist any need for the deciding judge
to take judicial notice of the evidence presented in
each case.

1
Section 1. Consolidation. When actions involving a
common question of law or fact are pending before the court,
it may order a joint hearing or trial of any or all the matters in
issue in the actions; it may order all the actions consolidated;
and it may make such orders concerning proceedings therein
as may tend to avoid unnecessary costs or delay.
SC also expressed its disapproval over the
failure of the spouses Yu and Leyte Lumbers counsel
to seek consolidation of the cases, which led to a
simple collection case to remain pending for twenty-
seven years. Moreover, SC held that the filing of the
two cases in different branches of the court may be
held to be tantamount to forum shopping which not
only put the respondents to additional unnecessary
expense, but wasted the precious time of the courts as
well.
SC likewise admonished RTC Branches 6 and 8
for the manner in which the case before each sala was
handled and conducted (for failing to order
consolidation in the records of the cases).


MEGA LAND V. CE CONSTRUCTION

Facts: Mega-Land Resources and Development
Corporation and C-E Construction Corporation were the
partiess in a matter submitted for arbitration to the
espondent Construction Industry Arbitration
Commission (CIAC). The subject of the dispute was not
mentioned in the case. On 19 June 2002, the CIAC
rendered a decision ordering Mega Land to pay CE
P18.6 Million, plus interest.
Mega Land received a copy of the CIAC
decision on 20 June 2002. Following Section 4, Rule 43
of the 1997 Rules of Civil Procedure, it had 15 days, or
until July 5 to appeal the same to the Court of
Appeals. Before the CIAC, Mega Land was represented
by the Fajardo Law Offices. On July 4, Mega Land,
through Fajardo Law Offices, filed a Motion for
Extension of Time to file a Petition for Review Under
Rule 43. The motion was docketed as CA-G.R. No.
71485 ("first case"), and it sought an extension until
20 July 2002 to file the petition for review. The reason
offered in the motion was "the voluminous records, the
complexity of the legal and factual issues, and
generally, the difficulty on the part of petitioners
counsel due to its other professional obligations to
timely file the petition."
However, on July 5, Mega Land, this time
through its President and General Manager Sy Siong
Lato (Sy), filed a Motion for Extension of Time to File
Petition for Review on Certiorari Under Rule 43. The
new motion for extension was assigned its own docket
number, CA-G.R. SP No. 71504 ("second case") and
also sought an extension until 20 July 2002 to file the
petition for review. The reason offered in this second
motion was it was mutually agreed between petitioner
and its counsel, the Fajardo Law Offices, that Mega
Land should secure another counsel due to "the
disagreements and/or differences of opinion in the
handling of the case." as a consequence of which it
went into the process of retaining the services of
another lawyer for the case.
Mega Land later said that the filing made by
Fajardo Law Offices in the first case was without its
prior knowledge.
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The first case was raffled to the CAs 16
th
Division.
Despite the apparent termination of services of the
Fajardo Law Offices, no move was undertaken to
withdraw or otherwise disavow the motion earlier filed
by that counsel. The second case was raffled to the
CAs 5
th
Divison. Both divisions granted the extension
up to July 20. Justice Buzon wrote the resolution in
the first case and Justice Regino wrote the one for the
second case.
Mega Land hired Atty. Richard S. Flores to
represent it before the CA. Atty. Flores filed a Motion
for Second Extension of Time to File Petition for Review
with Formal Entry of Appearance, offering as reason
the fact that his services were contracted only on 15
July 2002, or five (5) days before the expiration of the
extended reglementary period. The extension asked
for a new period of 15 days, or until 4 August 2002,
through the motion filed by Atty. Flores.
The caption used in the new motion for
extension by Atty. Flores is that of the second case
which was initiated by the motion filed by Sy in behalf
of petitioner. By this time, the former 5
th
Division
hearing that case had been reorganized, and the
second motion for extension was assigned to the
Special 3rd Division. It granted the second motion for
extension, again through a Resolution by Justice
Regino.
Remember that there are now 2 cases with the
CA. In the first case, no further pleading was filed by
Mega Land or the Fajardo Law Offices after the
granting of the initial motion for extension therein.
Thus, the period elapsed on July 20. In the second
case, because of the 2 motions for extension, Mega
Land had until 4 August 2002 to file its petition.
On 1 August 2002, Atty. Flores, filed, in behalf
of Mega Land a Petition for Review of the earlier CIAC
decision. The caption of the petition clearly states the
docket number as "CA-G.R. SP No. 71485," that of the
first case, or the same docket number under which the
earlier motion for extension filed by Fajardo Law
Offices was docketed.
Mega Lands right to file a petition in the first
case had expired on 20 July 2002. The 16th Division
then issued a Resolution which noted that Mega Land
had been granted an extension until 20 July 2002 to
file the petition, but that the petition had actually been
filed only on 2 August 2002. The Sixteenth Division
likewise noted that while the Petition for Review
alleged that a motion for second extension of time had
been filed, the Judicial Records Division of the
appellate court verified that no such motion had been
filed. It said the petition was filed out of time.
In the meantime, the second case which had
been reassigned to the 3
rd
Divison of the CA, issued a
Resolution on October 8, 2002 dismissing Mega Lands
appeal because it failed to file a petition for review.
Mega Land filed an MR of the CA 16
th
Divisons
Resolution (first case). In it, Atty. Flores said that he
was confused with the case number since Mega Land
did not inform him that it also filed a Motion for
Extension of time to file Petition for Review before the
CA and paid the necessary docket fees. He basically
explained the existence of the two cases. The MR was
denied. The CA 16
th
Division said that the MR should
have been filed in the second case.

Issue: Whether or not Mega Land was accorded due
process.

Held: It was.
Ratio: It was Atty. Flores himself who drafted and filed
the second Motion for Extension in the second case;
thus, it should have been a simple matter of writing in
the petition he eventually filed, the same and only
docket number he had used earlier when he filed the
motion. But he did not do so. Settled is the rule that
the negligence of counsel binds the client.
Forum shopping consists of filing multiple suits
involving the same parties for the same cause of
action, either simultaneously or successively for the
purpose of obtaining a favorable judgment. It exists
when, as a result of an adverse opinion in one forum, a
party seeks a favorable opinion in another, or when he
institutes two or more actions or proceedings grounded
on the same cause, on the gamble that one or the
other court would make a favorable disposition. There
certainly is all the opportunity to accomplish the wrong
intended by forum-shopping through the filing of two
petitions for review with a collegiate court such as the
Court of Appeals, as each petition would be docketed
separately and assigned to a division of that court,
thus allowing two different divisions to act
independently as each considers and treats the
petition. Thus, no petition for review on certiorari may
be filed in the Court of Appeals if there is already a
similar petition already filed or pending with that same
court.
The filing of each motion for extension along
with the corresponding full docket fees gives rise to a
separate case before the Court of Appeals or Supreme
Court that is accordingly docketed and raffled for
evaluation and eventual deliberation. If each of the
cases involve the same petitioner, the same
respondents, and seek the extension of time to file a
petition or appeal concerning the same decision of the
lower court or tribunal, then all the opportunity and
dangers of forum shopping are imminent. The evil
itself would finally be actualized once a separate
appeal or petition for each case is actually filed.
Thus, even if forum-shopping had not yet been
consummated, the steps undertaken by Mega Land
herein may give rise to a prima facie indication that it
was about to commit forum-shopping. A party who
commits such error in good faith has the obligation to
correct the same upon becoming aware of the
anomaly.
The fact that the petition for review intended
for filing in the second case bore instead the docket
number of the first case indicates that Mega Land and
its new counsel, Atty. Flores, knew of the first case
earlier initiated by Fajardo Law Offices. In short, at the
time the petition was filed with the Court of Appeals,
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Mega Land had known that there were two similar
cases involving the same parties and causes of action.
There were a variety of things Mega Land could
have done. It could have moved to withdraw either
any of the motions for extension of time, so that there
would be only one case pending with the appellate
court. It really would not matter if it were the first case
or the second case which was withdrawn, since either
case was a viable vehicle for Mega Lands intended
appeal. Had it done this at the onset, even if later the
filed petition itself stated the wrong docket number,
the Court of Appeals could have easily recorded the
pleading under the case that remained in existence
since it would anyway be incapable of filing the same
under the records of a case that had already been
withdrawn. Our procedural rules were not crafted with
the intent of unilaterally conferring fatal consequences
on simple typographical errors.
The "fiasco" ensued merely from applying the
correct legal procedures. Even as no petition was
timely filed in the first case after no second motion for
extension was sought therein, said case had not yet
been closed and terminated upon the belated filing of
the appeal. Since the appeal was filed beyond the
reglementary period, its dismissal was in accord with
the rules of procedure. At the same time, since no
petition was filed at all in the second case despite the
providential granting of two successive motions for
extension, the appeal was correctly dismissed.
There was no obligation on the part of the
Sixteenth Division to forward the petition filed to the
Third Division instead of dismissing the same. The
docket number indicated in the caption of that petition
made it clear that the same was addressed to the
Sixteenth Division instead of the Third.
It should be remembered that there is no
inherent right of appeal, as appeals are purely
statutory. Since the right to appeal is neither a natural
right nor a part of due process, it may be exercised
only in the manner and in accordance with the
provisions of law.
A pleading filed in one case does not bind the
proceedings in another case, even if both cases are
heard by just one court.
We have duly considered that perhaps this
entire untidiness could have been avoided had the
Court of Appeals at the outset consolidated the two
cases. Yet such consideration is ultimately of no
moment to petitioner. For one, under the 2002
Internal Rules of the Court of Appeals (RIRCA), there is
no mandatory obligation to consolidate related cases.
The language utilized in Rule 3, Section 3 of the
RIRCA, which authorizes consolidation is cases, is
merely directory in character, providing as it does:
"[w]hen related cases are assigned to different
Justices, they may be consolidated and assigned to
one Justice." More importantly perhaps, the
consolidation of cases was never intended to cure the
defect of forum-shopping. If one litigant has filed
multiple suits involving the same parties for the same
cause of action, the consolidation of these suits is not
the correct palliative. These suits should instead be
dismissed on the ground of forum-shopping.

Rule 33: DEMURRER TO EVIDENCE

RADIOWEALTH VS. DEL ROSARIO

FACTS: The Vicente spouses jointly and severally
executed, signed and delivered in favor of Radiowealth
Finance Company a promissory note for 138,948
pesos. Pertinent provisions of the promissory note
provide that payment was to be made in installments
(11,579 payable for 12 consecutive months) and that a
late penalty charge of 2.5% shall be added to each
unpaid installment from due date thereof until fully
paid. It is also agreed that if default be made in the
payment of any of the installments or late payment
charges thereon as and when the same becomes due
and payable, the total principal sum then remaining
unpaid, together with the agreed late payment charges
thereon, shall at once become due and demandable
without need of notice or demand.
The Vicente spouses defaulted on the monthly
installments. Despite repeated demands, they failed to
pay their obligations under the promissory note.
Radiowealth filed a complaint for the Collection
of a Sum of Money before RTC Manila. During the trial,
Radiowealths collection and credit officer Jasmer
Famatico presented in evidence the check payments,
the demand letter, the customers ledger card, another
demand letter and Metropolitan Bank dishonor slips.
He admitted that he did not have any personal
knowledge of the transaction or the execution of any of
the documentary evidence which had been merely
endorsed to him. The trial court issued an order
terminating the presentation of evidence by
Radiowealth. Thus, the latter formally offered its
evidence and exhibits and rested its case.
The Vicente spouses filed a Demurrer to
Evidence for alleged lack of cause of action. It was
granted on the ground that the evidence presented by
Radiowealth were merely hearsay. However, the CA
reversed ruling that the judicial admissions (admitted
the due execution and genuineness of the promissory
note and demand letter) of the Vicente spouses
established their indebtedness to Radiowealth. It
remanded the case for further proceedings.

ISSUE: WON the CA erred in remanding the case to
the trial court instead of rendering judgment on the
basis of Radiowealths evidence??? YES.

RULING:
Section 1, Rule 33 of the Rules of Court reads as
follows:
SECTION 1. Demurrer to evidence.After the
plaintiff has completed the presentation of his
evidence, the defendant may move for dismissal on
the ground that upon the facts and the law the plaintiff
has shown no right to relief. If his motion is denied,
he shall have the right to present evidence. If the
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motion is granted but on appeal the order of dismissal
is reversed he shall be deemed to have waived the
right to present evidence.
Explaining the consequence of a demurrer to
evidence, the Court in Villanueva Transit v.
Javellana pronounced:
The rationale behind the rule and doctrine is simple
and logical. The defendant is permitted, without
waiving his right to offer evidence in the event that his
motion is not granted, to move for a dismissal (i.e.,
demur to the plaintiffs evidence) on the ground that
upon the facts as thus established and the applicable
law, the plaintiff has shown no right to relief. If the
trial court denies the dismissal motion, i.e., finds that
plaintiffs evidence is sufficient for an award of
judgment in the absence of contrary evidence, the
case still remains before the trial court which should
then proceed to hear and receive the defendants
evidence so that all the facts and evidence of the
contending parties may be properly placed before it for
adjudication as well as before the appellate courts, in
case of appeal. Nothing is lost. The doctrine is but in
line with the established procedural precepts in the
conduct of trials that the trial court liberally receive all
proffered evidence at the trial to enable it to render its
decision with all possibly relevant proofs in the record,
thus assuring that the appellate courts upon appeal
have all the material before them necessary to make a
correct judgment, and avoiding the need of remanding
the case for retrial or reception of improperly excluded
evidence, with the possibility thereafter of still another
appeal, with all the concomitant delays. The rule,
however, imposes the condition by the same token
that if his demurrer is granted by the trial court, and
the order of dismissal is reversed on appeal, the
movant losses his right to present evidence in his
behalf and he shall have been deemed to have elected
to stand on the insufficiency of plaintiffs case and
evidence. In such event, the appellate court which
reverses the order of dismissal shall proceed to render
judgment on the merits on the basis of plaintiffs
evidence.
In other words, defendants who present a
demurrer to the plaintiffs evidence retain the right to
present their own evidence, if the trial court
disagrees with them; if the trial court agrees with
them, but on appeal, the appellate court
disagrees with both of them and reverses the dismissal
order, the defendants lose the right to present their
own evidence. The appellate court shall, in addition,
resolve the case and render judgment on the merits,
inasmuch as a demurrer aims to discourage prolonged
litigations.
In the case at bar, the trial court, acting on the
Vicente spouses demurrer to evidence, dismissed the
complaint on the ground that Radiowealth had adduced
mere hearsay evidence. However, on appeal, the CA
reversed the trial court because the genuineness and
the due execution of the disputed pieces of evidence
had in fact been admitted by the Vicente spouses.
Applying Rule 33, Section 1 of the 1997 Rules
of Court, the CA should have rendered judgment on
the basis of the evidence submitted by
Radiowealth. While the CA correctly ruled that the
documentary evidence submitted by Radiowealth
should have been allowed and appreciated and that
Radiowealth presented quite a number of documentary
exhibits, the SC agrees with Radiowealth that the CA
had sufficient evidence on record to decide the
collection suit. A remand is not only frowned upon by
the Rules, it is also logically unnecessary on the basis
of the facts on record.


PEOPLE VS CACHOLA

FACTS. In just an instant, 12-year-old Jessie E.
Barnachea lost his mother, an elder brother, an uncle,
and a cousin as a result of the carnage that took place
at around 6:00 p.m. of 28 December 1999 right inside
their house in Brgy. Calumbaya, Bauang, La Union.
Their horrible death was attributed to herein accused-
appellants.
At the trial before the RTC the prosecution
presented as witnesses Jessie and his brother and
neighbors, as well as several police officers. Their
testimonies disclose that when Jessie was about to
leave their house to watch cartoons in his uncles house
next door, two armed men suddenly entered the front
door of their house. The two ordered Jessie to drop to
the floor, and then hit him in the back. Without much
ado, the intruders shot to death Jessies uncle,
Victorino V. Lolarga. Jessie forthwith crawled and hid
under a bed, from where he saw the feet of a third
man who had also entered the house. The men
entered the kitchen and continued shooting. When the
rampage was over and after the malefactors had
already departed, Jessie came out of his hiding place
and proceeded to the kitchen. There he saw his
mother, Carmelita Barnachea; his brother Felix
Barnachea, Jr.; and his cousin Rubenson Abance - all
slaughtered.
Meanwhile, Jessies eldest brother, Robert E.
Barnachea testidfied that he saw armed men running
towards their house. He scampered away and hid at
the back of his uncles house. From where he was
hiding, he noticed a stainless jeep, with blue rim and
marking fruits and vegetables dealer, parked in front
of the fence of their house. In the next instant, he
heard gunshots and then saw men running from his
house. The men hurriedly boarded the jeep and left
the place. The jeep did not go unnoticed by the
neighbors. Russel Tamba was with some friends in
front of Rodas Store, around 100 meters away from
the Barnachea residence, when the jeep passed by
very slowly going towards the Barnachea residence.
After the prosecution had rested its case, the defense
counsels orally asked for leave of court to file a
demurrer to evidence. The trial court denied the
motion outright and set the schedule for the
presentation of the evidence for the defense. Instead
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of presenting their evidence, however, the appellants,
through their respective counsels, filed a Demurrer to
Evidence even without leave of court.
On 26 September 2000, the trial court
rendered a decision (1) convicting (a) Cachola and
Amay, as principals, of four counts of murder; and (b)
Marquez, Laegen, Sagun, Guerzo, Ignacio, and
Echabaria, as accomplices, of four counts of murder.
Appelants contest that the court erred because
they were not allowed to present evidence after filing
their demurrer to evidence without leave of court.

ISSUE. Whether the trial court erred in not allowing the
appellants to present evidence after filing their
demurrer to evidence without leave of court. NO.

RATIO. Section 15, Rules 119 of the Rules of Court is
clear on the matter, thus:
SEC. 15. - Demurrer to evidence. - After the
prosecution has rested its case, the court may dismiss
the case on the ground of insufficiency of evidence: (1)
on its own initiative after giving the prosecution an
opportunity to be heard; or (2) on motion of the
accused filed with prior leave of court.
If the court denies the motion for dismissal,
the accused may adduce evidence in his
defense. When the accused files such motion to
dismiss without express leave of court, he waives the
right to present evidence and submits the case for
judgment on the basis of the evidence for the
prosecution. (Underscoring supplied).
The filing by the appellants of a demurrer to
evidence in the absence of prior leave of court was a
clear waiver of their right to present their own
evidence. Furthermore, it cannot be said that the
waiver was not clear. The trial court postponed the
hearings on the motion for demurrer, even after leave
of court had been denied, and then granted extensions
to Amay until he finally adopted the position of his co-
Appellants. At no time other than in this automatic
review was there any attempt that is contrary to the
waiver of the presentation of evidence.

RULES 34 AND 35: JUDGMENT ON
THE PLEADINGS AND SUMMARY
JUDGMENT

WOOD TECHNOLOGY CORP V. EQUITABLE
BANKING CORP.

Facts: The case originated from a Complaint for Sum
of Money filed by respondent Equitable Bank against
the Wood Technology Corporation (WTC), Cordova and
Young. The Complaint alleged that WTC obtained from
Equitable Bank a loan in the amount of US$75,000,
with 8.75% interest per annum, as evidenced by a
Promissory Note signed by Cordova and Young as
representatives of WTC. Cordova and Young executed
a Surety Agreement binding themselves as sureties of
WTC for the loan. Respondent bank made a final
demand for WTC to pay its obligation but petitioners
failed to pay. In their Answer, petitioners admitted that
WTC obtained the loan and that Cordova and Young
bound themselves as its sureties. They also claimed
that the loan had not yet matured as the maturity date
was purposely left blank, to be agreed upon by the
parties at a later date. Since no maturity date had
been fixed, the filing of the Complaint was premature,
and it failed to state a cause of action. They further
claimed that the promissory note and surety
agreement were contracts of adhesion with terms on
interest, penalty, charges and attorneys fees that
were excessive, unconscionable and not reflective of
the parties real intent. Equitable Bank moved for a
judgment on the pleadings. RTC rendered judgment
based on the pleadings in favor of Equitable Bank. CA
affirmed. The appellate court ruled that there was no
need to present evidence to prove the maturity date of
the promissory note, since it was payable on demand.
MR denied.

Issue: WON CA erred in affirming the RTCs judgment
on the pleadings

HELD: The SC held that the ruling of the RTC as
affrimed by the CA is valid as a summary judgment
and not a judgment on the pleadings.
At the outset, we must stress the Courts policy
that cases and controversies should be promptly and
expeditiously resolved. The Rules of Court seeks to
shorten the procedure in order to allow the speedy
disposition of a case. Specifically, we have rules on
demurrer to evidence, judgment on the pleadings, and
summary judgments. In all these instances, a full
blown trial is dispensed with and judgment is rendered
on the basis of the pleadings, supporting affidavits,
depositions and admissions of the parties.
The RTC knew that the Answer asserted special
and affirmative defenses. the CA recognized that
certain issues were raised, but they were not genuine
issues of fact, WBC insisted that they raised genuine
issues; and Equitable argued that WBCs defenses did
not tender genuine issues. However, whether or not
the issues raised by the Answer are genuine is not the
crux of inquiry in a motion for judgment on the
pleadings. It is so only in a motion for summary
judgment. In a case for judgment on the pleadings,
the Answer is such that no issue is raised at all. The
essential question in such a case is whether there are
issues generated by the pleadings.
This is the distinction between a proper case of
summary judgment, compared to a proper case for
judgment on the pleadings. In Narra Integrated
Corporation v. CA: The existence or appearance of
ostensible issues in the pleadings, on the one hand,
and their sham or fictitious character, on the other, are
what distinguish a proper case for summary judgment
from one for a judgment on the pleadings. In a proper
case for judgment on the pleadings, there is no
ostensible issue at all because of the failure of the
defending partys answer to raise an issue. On the
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other hand, in the case a of a summary
judgment, issues apparently exist i.e. facts are
asserted in the complaint regarding which there is as
yet no admission, disavowal or qualification; or specific
denials or affirmative defenses are in truth set out in
the answer but the issues thus arising from the
pleadings are sham, fictitious or not genuine, as shown
by affidavits, depositions, or admissions.
Applying the requisites of a judgment on the
pleadings vis--vis a summary judgment, the
judgment rendered by the RTC was not a judgment on
the pleadings, but a summary judgment. Summary
judgment is a procedure aimed at weeding out sham
claims or defenses at an early stage of the litigation. In
a summary judgment, the crucial question is: are the
issues raised by petitioners not genuine so as to justify
a summary judgment? A genuine issue means an
issue of fact which calls for the presentation of
evidence, as distinguished from an issue which is
fictitious or contrived, an issue that does not constitute
a genuine issue for trial. The judgment rendered by
the trial court is valid as a summary judgment, and its
affirmance by the Court of Appeals, as herein clarified,
is in order.


BASCUG VS ARANDAY

Facts: Laurentino Bascug filed a complaint charging
Judge Aranday with grave misconduct, knowingly
rendering an unjust judgment, malicious delay in the
administration of justice and violation of the code of
judicial conduct.
(There are several cases from which the admin
complaint arose from. But only the facts related to the
charge of grave misconduct is related to judgment on
the pleadings)
RELATED PART: In the civil case of Vicente
Ditching vs Odisco Farms System Cooperative
Foundation, Bascug charged Judge Aranday with gross
misconduct when he directed a judgment on the
pleadings. Bascug who was actually the president of
Odisco Farms, claims that Judge Aranday declared the
parties as having agreed to the rendition of a
judgment on the pleadings even when Odisco Farms
never agreed to it. In fact, Bascug alleges that Odisco
Farms did not submit any memorandum for judgment
on the pleadings required by Judge Aranday in one of
his orders. Nevertheless, despite the absence of such
memorandum, Judge Aranday rendered judgment
based on the pleadings in favor of Vicente Ditching et
al. An MR was filed but was denied. Case was brought
to the CA and the case was remanded for further
proceeding.
Judge Aranday contends that parties had
manifested that they had no objection to the
submission of the case for judgment on the pleadings.

Issue: Whether Judge Aranday was correct in
rendering a judgment on the pleadings? NO

Held: Sec1, Rule34 of the Rules of Court provides,
where an answer fails to tender an issue or otherwise
admits the material allegations of the adverse partys
pleading, the court may on motion of that party, direct
judgment on such pleading.
Judge Aranday states that both parties agreed
to have judgment on the pleadings but the minutes of
the session merely stated that both parties will submit
their respective memoranda for judgment on the
pleadings. Only Vicente Ditching submitted a
memorandum while Odisco Farms did not. In fact, in
the MR submitted, Odisco Farms pointed out that the
parties presented widely opposing contentions in their
respective pre-trial brief, and the court cannot rely on
conjectures on the wild monetary claims of Ditching.
In view of these objections, there was no clear
agreement to submit the case to a judgment on the
pleadings, much less an implied admission of each
others factual allegations that would support a
submission by the parties to the judgment on the
pleadings.


ELAND PHIL. V. GARCIA

FACTS: Respondents Azucena Garcia, Elino Fajardo,
and Teresa Malabanan, the heir of Tiburcio Malabanan,
filed a Complaint for Quieting of Title with Writ of
Preliminary Injuction with RTC against Petitioner Eland
Phils., Inc. Respondents Garcia et al claimed that they
are owners, in fee simple title, of a parcel of land by
occupation and possession under the provision of Sec.
48(b) of the Public Land Law or Commonwealth Act
No. 141, as amended. For having been in continuous,
public, and adverse possession as owners for at least
30 years, respondents further claimed that they were
not aware of any person or entity who had a legal or
equitable interest or claim on the same lot until the
time they were requesting that the lot be declared for
tax purposes. They found out that the lot was the
subject of a land registration proceeding that had
already been decided by the same court where their
complaint was filed. (Note: There are a lot of motions
in between, read original case for more details on the
matter)
TC declared Eland in Default and allowed
Garcia et al to present evidence ex parte. Eland filed
an MR which was granted. TC then admitted Elands
Answer Ad Cautelam. Garcia et al filed a Motion for
Clarification as to whether or not the evidence
presented ex parte was nullified by the admission of
Elands Answer Ad Cautelam. Eland filed its Comment.
Pre-trial conference was scheduled wherein the
parties submitted their pre-trial briefs. However, Eland
filed a Motion to Suspend the Proceedings because it
filed with the CA a petition for certiorari for the denial
of its MTD. The petition was subsequently denied.
Hence, the TC ruled that the reception of evidence
presented by Garcia et al before the Clerk of Court
remained as part of the records of the case and that
Eland had the right to cross-examine the witness and
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to comment on the documentary exhibits already
presented. Eland filed a MR which was denied.
Eventually, Garcia et al filed a Motion for
Summary Judgment to which Eland filed its Opposition.
TC however granted the Motion for Summary
Judgment. CA dismissed Elands appeal.

ISSUES:
1. WON the 10 day notice rule under Rule 35 Sec. 3
was violated
2. WON the a motion for summary judgment in an
action for quieting of title is proper
3. WON the CA erred in holding that there are no
genuine factual and triable issues in the case
(*other issues were not included in this digest)

HELD:
1. NO, there was substantial compliance.
Eland claimed that the 10 day notice rule
under Rule 35 Sec. 3 was violated when they received
a copy of the motion for summary judgment only on
the very same day that the motion is set for hearing.
Eland further claims that the TC never conducted any
hearing on the motion for summary judgment.
The above contention, however, is misguided.
The CA was correct in its observation that there was
substantial compliance with due process. The CA ruled,
as the records show, that the 10 day notice rule was
substantially complied with because when Garcia et al
filed the motion for summary judgment on August 9,
1999, they furnished petitioner with a copy thereof on
the same day as shown in the registry receipt and that
the motion was set for hearing on August 20, 1999, or
10 days from the date of the filing thereof.

2. YES.
Eland further argues that summary judgment
is not proper in an action for quieting of title. The
Court however disagrees. This Court has already ruled
that any action can be the subject of a summary
judgment with the sole exception of actions for
annulment of marriage or declaration of its nullity or
for legal separation.

3. YES.
Proceeding to the main issue, this Court finds
that the grant of summary judgment was not proper.
A summary judgment is permitted only if there is no
genuine issue as to any material fact and a moving
party is entitled to a judgment as a matter of law.
A summary judgment is proper if, while the pleadings
on their face appear to raise issues, the affidavits,
depositions, and admissions presented by the moving
party show that such issues are not genuine.
It must be remembered that the non-
existence of a genuine issue is the determining
factor in granting a motion for summary judgment,
and the movant has the burden of proving such
nonexistence. The TC found no genuine issue as to any
material fact that would necessitate conducting a full-
blown trial. However, a careful study of the case
shows otherwise.
The facts pleaded by Garcia et al in their
motion for summary judgment have been duly
disputed and contested by Eland, raising genuine
issues that must be resolved only after a full-blown
trial. When the facts as pleaded by the parties are
disputed or contested, proceedings for
summary judgment cannot take the place of trial. In
the present case, the petitioner was able to point out
the genuine issues. A genuine issue is an issue of fact
that requires the presentation of evidence as
distinguished from a sham, fictitious, contrived or false
claim.
It is of utmost importance to remember that
petitioner is already the registered owner (Original
Certificate of Title [OCT] No. 0-660 issued by the
Register of Deeds) of the parcel of land in question,
pursuant to a decree of registration based on the
ruling of the same court that granted the summary
judgment for the quieting of title.
By granting the summary judgment, the TC
has in effect annulled its former ruling based on a
claim of possession and ownership of the same land for
more than 30 years without the benefit of a full-blown
trial. The fact that Garcia et al seek to nullify the
original certificate of title issued to Eland on the claim
that the former were in possession of the same land
for a number of years, is already a clear indicium that
a genuine issue of a material fact exists. This, together
with the failure of Garcia et al to show that there were
no genuine issues involved, should have been enough
for the TC to give the motion for summary judgment,
filed by Garcia et al, scant consideration. TCs have
limited authority to render summary judgments and
may do so only when there is clearly no genuine issue
as to any material fact.

RULE 36: JUDGMENT

SPS. CONSING V. CA

FACTS:
- Sps. Consing purchased on credit various grades of
fertilizer through SPCMA (Sugar Producers
Cooperative Marketing Assoc) on the strength of
the documents presented by them (Promissory
Note and a Certification by PNB)
- Documents: Certification by PNB to show that the
spouses have an agricultural crop loan line of
P3.9M with a fertilizer allotment of P1.39M; a PN
worth P481K
- But when SPCMA presented the PN to PNB, it
refused to honor it saying that the spouses no
longer had fertilizer line with PNB
- SPCMA filed a collection suit vs. Sps. Consing
- RTC ruled in favor of SPCMA. CA affirmed the
decision
- CA: In the PN, spouses bound themselves to pay
SPCMA and that the Certification does not show
that PNB guaranteed the transaction. Under Art.
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2055 of the CC, guaranty cannot be presumed but
must be express.

ISSUE: For the purposes of Judgment: was the
decision of the RTC proper? NO

HELD: SC: The SC brought to our attention the 2-
page decision of the RTC. While Judge Querubin
Querubin mentioned his factual findings, the legal
basis of his ruling is not set out in the decision. Judge
Querubin failed to meet faithfully the requirement
demanded by the Constitution from the courts in
rendering their decisions.
Section 14, Article VIII of the Constitution declares
that:
Sec. 14. No decision shall be rendered by
any court without expressing therein clearly
and distinctly the facts and the law on which it
is based.
No petition for review or motion for
reconsideration of a decision of the court shall
be refused due course or denied without
stating the legal basis therefor.
The court must inform the parties to a case of
the legal basis for the courts decision so that if a party
appeals, it can point out to the appellate court the
points of law to which it disagrees. Every judge should
know the constitutional mandate and the rationale
behind it. Judge Querubin should have known the
exacting standard imposed on courts by Section 14,
Article VIII of the Constitution and should not have
sacrificed the constitutional standard for brevitys sake.
The failure of the trial court decision to measure
up to the standard set by the Constitution is too gross
to ignore as it is in stark contrast to the CAs decision.
The CAs decision, while also brief, being only three
pages long, laid down the factual and legal reasons
why Antonio and Soledad are the ones liable to
SPCMA, and not PNB. The CAs discussion of the
merits of this case enabled the parties to pinpoint the
proper issues that we now review.
Side note: the SC upheld the decision of the CA,
holding the spouses liable
(interest issue they were claiming that there
was double imposition of interest: sps. Consing did
not only bind themselves to pay the principal amount,
they also promised to pay (1) the interest of 1% per
month on all the overdue accounts, (2) the additional
sum of 25% of the total amount due as attorneys
fees, and (3) 10% of the indebtedness as liquidated
damages which, in either case, shall not be less than
P250. Since they freely entered into the contract, the
stipulations in the contract are binding on them.)


HEIRS OF VALDEZ, SPS. MALVAR V. CA AND LC
LOPEZ RESOURCES
Case is a bit complicated. Did my best. Please bear
with the digest.

Main point: Conflicting resolutions were issued on the
same date and in the same case.

There was an earlier case for quieting of title
and declaration of nullity of transfer certificates filed
with the RTC Branch 71 of Antipolo entitled Manila
Construction v. Sps Dela Rosa. Herein plaintiffs, the
Valdez heirs and the Sps. Malvar were among the
plaintiffs in that case. The RTC granted them an
injunction order and later, a writ of prelim mandatory
injunction to place them in possession of the land
disputed in the case. The Sheriff of RTC implemented
the order and the writ in the property of herein
defendants, Lopez Resources. They tore down the
fences enclosing the property, but Lopez Resources
succeeded in maintaining possession.
On April 3 Lopez Resources went to the CA to
question the order and the writ (It was a petition for
certiorari and prohibition). It claimed that the RTC
committed GAD in depriving it of its property because
it wasnt a party to the case and the property against
which the writ was enforced was not part of the land
disputed in the said case. This case was assigned to
CAs 9
th
division. There was an issue with regard to its
verification and certification against forum shopping,
because it was not signed by a duly authorized
representative of Lopez Resources. The CA dismissed
the petition without prejudice. This resolution was
issued May 5, 2003.
Lopez Resources then filed another similar
petition. (It re-filed the same case). This second case
was raffled to the CA 7
th
division. Also on May 5, 2003,
the 7
th
division issued a resolution requiring herein
petitioners, Heirs of Valdez and Sps Malvar to file their
comment on the Lopez Resources petition and for
Lopez Resources to correct its error on the certification
against non-forum shopping.
Lopez Resources and herein petitioners
received the CA Resolution ordering the dismissal of
the case, but the other parties in the case only
received the Resolution requiring them to comment.
Because of the conflict, CA issued another Resolution
to clarify its clerical error 86 days after the 2
conflicting resolutions were issued. (CA claimed that
the resolution for dismissal was only a draft and was
not meant to be delivered).
Instead of a comment, herein petitioners
moved for the dismissal of the (2
nd
) petition because
(1) CA has no jurisdiction over the case, since the 1
st

petitions dismissal had become final and (2) even if
the court has jurisdiction, the re-filed petition (the 2
nd

one) should be dismissed on the ground of litis
pendentia, since the CA has not terminated the
proceedings in the 1
st
petition.

Issue: should the petition filed by Lopez Resources be
denied? No.

Ruling: No GAD committed by CA. In both resolutions,
what is clear is that the court intended to allow a
rectification of the deficiency in Lopez Resources' non-
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forum shopping certification in view of the merits that
the face of the petition showed. It was within the CA's
power to issue what either resolution decreed without
committing GAD. Re: 1
st
Resolution, CA correctly
dismissed the petition for the deficiency it found in the
non-forum shopping certification. Section 5, Rule 7 of
the ROC provides that failure to comply shall be
cause for the dismissal of the case without prejudice.
Re: 2
nd
Resolution, CA could also require the
respondents to comment, with the obligation on the
part of the petitioner to undertake rectification, and
this action is actually supported by jurisprudence. In
several cases,

SC allowed initiatory pleadings or
petitions with initially defective verifications and
certifications of non-forum shopping on the ground of
substantial compliance. Strict compliance with the
requirement merely underscores its mandatory nature,
in that it cannot be dispensed with. The subsequent
submission of the required documents (such as the
secretary's certificate) constituted substantial
compliance with the procedural rules that justified
relaxation of the requirements in the interest of
justice. In the absence of any showing that the twin
issuance was attended by partiality no GADALEJ exists.
On the finality of judgment: Because the
mistake was on the part of the court, none of the
parties should suffer. The parties all acted pursuant to
the resolution they respectively received. Lopez
Resources could not be legally faulted, since it merely
accepted the dismissal and chose to re-file its petition,
this time supplying the deficiency that tainted its first
petition. The re-filing was done on May 23, 2003, i.e.,
prior to the finality of the resolution of dismissal. By
this act, Lopez Resources effectively kept its petition
legally alive.
The issuance of two conflicting resolutions can
only mean that no definite, specific determination was
made by the court. It is error to conclude that one
resolution lapsed to finality while the other did not. In
legal effect, there was effectively no definite resolution
that could have lapsed to finality because of the
mistake the court committed. This status continued
until a clarification was made by the issuing court,
dated August 1.
Even granting that the 1
st
Resolution became
final and executory, the rule on immutability of
judgment does not apply in cases where what is
to be modified or altered involves: (a) the
correction of clerical errors; (b) the so-
callednunc pro tunc entries which cause no
prejudice to any party; (c) void judgments [such
as a dismissal without prejudice that was not
intended to be issued] and those where
circumstances transpire after the finality that
render the execution or enforcement, as in this
case, of the judgment unjust or inequitable. To be
sure, the rule does not apply in cases where a
supervening event took place- such as the
mistake undisputably committed by the court
(i.e., the unintended release of one of the resolutions,
thus resulting in the conflict and confusion).
The 9th Division's clarificatory resolution of
August 1is valid. The CA never lost jurisdiction over
the case despite the re-filing of the petition;
jurisdiction, once acquired, is not lost except for
reasons that are not present in this case.
The question of whether Lopez Resources
forum shopped when it re-filed its petition is rendered
moot and academic. Lopez Resources, who cannot be
blamed for the CA's mistake, only followed what the
assailed 1
st
resolution allowed.It cannot be said that it
forum shopped by filing another petition while the 1
st

petition was pending. Insofar as it was concerned, its
1
st
petition had been dismissed without prejudice;
hence, there was no bar, either by way of forum
shopping, litis pendentia or res judicata, to the petition
it re-filed. Lopez Resources did not lack good faith.
After its re-filed petition and after receipt of the August
1 Resolution, it immediately filed a Manifestation and
Motion for Clarification to seek guidance on which of
the two petitions should subsist.


INTRAMUROS TENNIS CLUB V. PHILIPPINE
TOURISM AUTHORITY

FACTS: Private respondent Philippine Tourism
Authority (Tourism Authority) owns the Victoria Tennis
Courts in Intramuros, Manila by virtue of PD 1763. In a
Memorandum of Agreement executed in 1987, Tourism
Authority transferred the management, operation,
administration and development of the Victoria Tennis
Courts to petitioner Philippine Tennis Association
(Tennis Association) for a period of 10 years. Petitioner
Intramuros Tennis Club (ITC) is an affiliate of Tennis
Association and has for its members tennis players and
enthusiasts who regularly use the facilities of the
Victoria Tennis Courts.
During the effectivity of the MOA, the Tourism
Authority wrote to the Tennis Association alleging
violations by the Tennis Association of the terms and
conditions of the MOA. The former demanded the
surrender of the possession of Victoria Tennis Courts.
The Tourism Authority wrote a second letter
demanding the Tennis Association to vacate the
premises and to give way to the Tourism Authoritys
golf course expansion program with private respondent
Club Intramuros.
Petitioners Tennis Association instituted a case
for preliminary injunction, damages and prayer for TRO
with the RTC. Among others, it alleged that by
complying with the demand to vacate, petitioner ITC
stands to sustain liability because it had prior
commitments to use the Victoria Tennis Courts for two
activities.
The TRO was granted as well as the
preliminary injunction.
Tourism Authority filed a motion to dismiss
stating that in view of the expiration of the MOA,
petitioners cause of action was moot and academic.
Motion to Dismiss was granted. Petitioners Tennis
Association appealed. While the appeal was pending,
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respondents Tourism Authority filed a motion for
execution of judgment pending appeal. It alleged that
there was an urgent necessity on the part of
respondents to immediately take possession of the
Victoria Tennis Courts by reason of its being heavily
deteriorated and unsanitized because of petitioners
failure to maintain its good condition. Court granted
the motion for execution.
In their MR, petitioners argue that under Sec.
2, Rule 39 of the ROC, respondent Court should have
conducted hearings to ascertain whether there were
good reasons to issue the writ of execution pending
appeal. Such was denied. Hence, the present civil
action for certiorari.

ISSUE:
W/N the RTC order granting the Motion to
Dismiss was a final order? YES, IT WAS.
W/N CA committed GADLEJ when it ordered
execution pending appeal of the judgment of
the RTC? NO, THEY DID NOT.

HELD: Note first that the respondent court may order
execution pending appeal when the ff. conditions are
present: 1) there must be a judgment or final order;
2) the trial court must have lost jurisdiction over the
case; 3) there must be good reasons to allow
execution; 4) such good reasons must be stated in a
special order after due order.
The RTC order which granted the Tourism
Authoritys motion to dismiss was a final order within
the contemplation of Sec. 2, Rule 39 of ROC. There is a
difference between a final judgment or order and one
which has become final or one that has become final
and executory.
A final judgment or order is one that finally
disposes of a case, leaving nothing more for the court
to do in respect thereto-such as an adjudication on the
merits which, on the basis of the evidence presented
at the trial, declares categorically what the rights and
obligations of the parties and which party is in the
right, or a judgment or order that dismisses an action
on the ground of res judicata or prescription, for
instance.
A final judgment or order in the sense just
described becomes final and executory upon
expiration of the period to appeal therefrom where no
appeal has been duly perfected or, an appeal
therefrom having been taken, the judgment of the
appellate court in turn becomes final. It is called final
and executory judgment because execution at such
point issues as a matter of right.
By its provisional nature, the remedy of
execution pending appeal requires only a final
judgment or order and a final and executory
judgment or order. The RTC order granting the Motion
to Dismiss, lifted the writ of preliminary injunction and
held private respondents entitled to possess the
Victoria Tennis Courts is a final order within the
contemplation of Rule 39 of ROC, inasmuch as it
makes an adjudication on the merits of the case and
dismisses petitioners action. Furthermore, at the time
the motion for execution pending appeal was filed, the
RTC had already lost jurisdiction over the case as
petitioners appeal had already been perfected and the
records of the case transmitted to respondent court.
We uphold CAs position in granting the motion
for execution pending appeal without a full-blown or
trial-type hearing as long as there was opportunity to
be heard.
The only issue remaining is whether or not
there was GADLEJ in granting the motion. Execution of
a judgment pending appeal is an exception to the
general rule that only a final judgment may be
executed. Thus the existence of good reasons is
essential. In this case, the Court said that good
reasons to grant the motion exist. The tennis court
was deteriorating thus respondent has to take
possession to save it from its condition.

RULE 37: MOTION FOR
RECONSIDERATION AND NEW TRIAL

FERNANDEZ V. CA

Facts: Olivares filed a complaint for unlawful detainer
against Fernandez in the MeTC. This was dismissed for
a lack of a sufficient cause of action. Olivares appealed
to the RTC and the court reversed the ruling of the
MeTC.
The copy of the decision was received by
Fernandez on June 28, 1994. On July 12 (14 days after
receipt), he filed an MR. He received copy of its denial
on Nov. 29. After this, he filed a motion for extension
of time to file a petition for review with the CA on Dec.
1. This was granted by the CA but Fernandez only
received the decision on Dec. 12.
In the meantime, he filed a motion for new
trial (newly discovered evidence) with the RTC on Dec.
9 (way past the 15-day period). This was denied by
the RTC on the ground that when Fernandez went to
the CA and filed a Motion for Extension of Time to File
Petition for Review, and the Court of Appeals
accordingly acted on the same by granting the
extension sought, jurisdiction of the Court of Appeals
over the parties and the subject matter had already
attached.

Issue: Was the motion for new trial filed on time?
NO.

Decision: It is without question that Fernandez
received a copy of the RTC Decision on 28 June 1994.
Fourteen (14) days after the receipt of the decision, he
filed an MR. This motion was denied by the RTC and
the Order of denial was received by Fernandez on 29
November 1994. Applying Rule 37, Section 1 of the
Revised Rules of Court
2
, he had only one (1) day left to

2
Section 1. Grounds of and period for filing motion for new
trial or reconsideration. Within the period for taking an
appeal, the aggrieved party may move the trial court to set
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file a motion for new trial since a motion for new trial
should be filed within the period to appeal, that is,
within fifteen (15) days from notice of the judgment.
The motion for new trial suspends the running of the
period to appeal but does not extend the time within
which an appeal must be perfected. Hence if denied, a
movant, like Fernandez in this case has only the
balance of the reglementary period within which to
appeal.
Since 30 Nov. 30 was a holiday, Fernandez had
up to 01 December 1994 to file the motion for new
trial. Instead of a motion for new trial, he filed before
the Court of Appeals on 01 December 1994 the motion
for extension of time to file petition for review.
Thereafter, and pending the resolution of his motion
before the Court of Appeals, Fernandez went back to
the RTC and filed on 09 December 1994 a motion for
new trial.
Applying the foregoing, Fernandez's motion for
new trial was filed out of time. The fifteen (15)-day
period for filing a motion for new trial cannot be
extended. Motions for extension of time to file a
motion for new trial or reconsideration may be filed
only in connection with cases pending before the
Supreme Court, which may in its sound discretion
either grant or deny the extension requested. No such
motion may be filed before any lower courts.

Side Issue: Does a motion for an extension of time to
file a petition for review divest the RTC of its
jurisdiction?
No. Jurisdiction is lost once an appeal is
perfected. An appeal is perfected when there is a
timely filing of the petition (such as petition for review)
and the payment of docket and other lawful fees.
In this case, the CA has not yet acquired
jurisdiction over the case because Fernandez merely
filed a motion for extension of time to file petition for
review but not the petition for review itself.


RP VS. PERALTA, ET AL. (sorry magulo talaga ang
daming dates)

Facts: The private respondents (there are several of
them), filed a complaint for the recovery of possession
and ownership of real property against the republic
and the DENR (petitioners). They alleged that the land
in litigation originally belonged to their father,
Benedicto Alonday, who applied and was issued a
homestead patent and the corresponding OCT. They
also alleged that they had bought the land from their
father, for which they were issued the corresponding
TCT. Later on however, the Bureau of Forest
Development (BFD) asked from, and was given
permission by Benedicto to use a portion of the land.
The BFD then constructed a building on the land. The

aside the judgment or final order and grant a new trial for one
or more of the following causes materially affecting the
substantial rights of said party.
private respondents asked the BFD to vacate but the
latter refused, hence the complaint.
The RTC ruled for the private respondents.
Here are the events that followed:
May 6, 1997 RTC ruled for private
respondents
May 20, 1997 petitioners received the
RTC decision
May 30, 1997 petitioners filed MR, this
was 5 days before the expiration of the
period to appeal
June 11, 1997 RTC issued an order
expunging the MR, because it was a mere
scrap of paper considering that the
petitioners did not file any notice of
hearing as required by the ROC. Note that
under Rule 15, notice of hearing on
motions should be sent to the opposing
party at least 3 days before the hearing.
July 14, 1997 petitioners, unaware of the
June 11 order, filed a manifestation with
notice of hearing on MR, appending thereto
a notice of hearing of their May 30 MR
July 18, 1997 petitioners received a copy
of the June 11 order
July 22, 1997 petitioner filed their notice
of appeal from the June 11 decision. The
private respondents opposed on the
ground that the MR filed in May 30 was a
mere scrap of paper, hence it did not toll
the reglementary period for appeal
August 11, 1997 RTC received the notice
of appeal filed by the petitioners last July
22
January 29, 1999 RTC issued an order
giving due course to the appeal. It ruled
that the petitioners still had 5 days from
June 18, 1997 (the date when they
received the June 11 order) within which to
perfect their appeal (FYI: it took this long
because the RTC remained vacant for some
time)
February 5, 1999 the RTC nevertheless
dismissed the appeal based on recent
jurisprudence (which was not mentioned)
that they failed to perfect their appeal
within the reglementary period.
February 26, 1999 petitioners filed a MR
May 6, 1999 MR denied
So after all of this shit, the petitioners filed certiorari
with CA which dismissed ruling that because the May
30 MR filed by the petitioners did not comply with the
ROC, it was a mere scrap of paper which did not toll
the period to file an appeal.

Issue: W/N the MR filed by the petitioners in May 30
was defective? YES!

Held/Ratio:
Motion for Reconsideration
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Sec. 2, Rule 37 a MR or a MNT shall be: (1)
made in writing; (2) stating the ground(s) therefore;
(3) with written notice served by the movant on the
adverse party.

Need for notice
The written notice is prescribed by Rule 15
(sections 4 and 5). The notice requirement, are
mandatory and non-compliance therewith is fatal and
renders the motion pro forma; a worthless piece of
paper. It is vital for due process. The notice for hearing
is required in order for the opposing party to voice out
its opinion on the motion. In cases of MR or MNT, the
running of the period for appeal is not tolled by the
mere filing or pendency of said motion, notice is
needed.
In this case, the OSG (the one who filed the
MR on behalf of the RP) merely stated that the failure
to file the notice was due to inadvertence. No sufficient
justification was given for the lack of notice.

NONETHELESS, the SC directed the reopening
of the case considering that it is one of public interest.
The land in dispute is part of the forest reserve, as
found by the SC. So the State should not be prejudiced
by the negligence of the OSG to follow procedural
rules.


PEOPLE vs. ODILAO

FACTS: Odilao was charged with estafa. Information
was filed with the RTC and a warrant of arrest was
issued. Odilao moved for reinvestigation. Thus the RTC
deferred the service of the warrant of arrest to give
way for the reinvestigation. After the reinvestigation
was conducted, the prosecutor found no probable
cause and moved to dismiss the case. The private
complainant filed a petition for review before the DOJ
seeking the reversal of the reinvestigation report. The
RTC deferred ruling on the Motion to Dismiss filed by
the prosecutor pending determination of the DOJ.
However, more than a year after, RTC denied the
Motion to Dismiss rationalizing that pursuant to the
Revised Rules on Criminal Procedure which took effect
in 2001, the court is now vested with the power to
determine probable cause. The RTC thereafter,
reinstated the warrant.
Odilao went to the CA via a petition for
certiorari and prohibition. The CA granted the petition
and ordered the RTC to defer proceedings pending
resolution by the DOJ.
The People through the OSG seasonably filed a
petition for review on certiorari with the SC. However,
without knowledge of the SC, private complainant
(without the conformity of the OSG) filed before the CA
a Motion for Reconsideration which was favorably
acted upon (i.e. on reconsideration, CA reversed itself
and ruled to implement the warrant).

ISSUE: Whether or not CA may take cognizance of the
MR even if a petition for review on certiorari had
already been filed with the SC NO

HELD: Section 15, Rule VI of the 2002 Internal Rules
of the Court of Appeals
3
(effective August 22, 2002),
explicitly provides that when the movant has filed with
the SC a petition for review on certiorari, any MR filed
with the CA is considered abandoned. Prudence
dictates that the Court of Appeals should have first
required private complainant to secure the conformity
of the OSG; or required the latter to comment on the
motion for reconsideration of the private complainant.


NEYPES V CA

Facts: Neypes, along with other petitioners, filed an
action for annulment of judgment and titles of land
and/or reconveyance and/or reversion with preliminary
injunction against Bureau of Lands, Land Bank, and
the heirs of Bernardo del Mundo. The heirs of del
Mundo filed an MR claiming that the action had already
prescribed. The RTC Judge ruled agreed with the heirs
and dismissed the case because of prescription.

On Feb 12, 1998, the TC rendered the decision that
the action had prescribed.
On March 3, 1998, Neypes received the copy of the
decision.
On March 18, 1998 (15 days after receipt), Neypes
filed an MR.
On July 1, 1998, the TC denied the MR.
On July 22, 1998, Neypes received the order denying
the MR.
On July 27, 1998, Neypes filed a notice of appeal,
paying the appeal fees on August 3, 1998.

The court a quo denied the notice of appeal claiming it
was 8 days late. Neypes claimed that they were not
late and that the 15-day period only started when they
received the order denying the MR. CA claimed that
the 15-day period started way back in March 3 when
Neypes received the copy of the decision.

Issue: When should the reglementary period start?
How many days are left, if any?

Held: An appeal should be taken within 15 days from
the notice of judgment or final order appealed from. A
final judgment or order is one that finally disposes of a
case, leaving nothing more for the court to do with
respect to it. It is an adjudication on the merits which,

3
SEC. 15. Effect of Filing an Appeal in the Supreme Court. -
No motion for reconsideration or rehearing shall be acted
upon if the movant has previously filed in the Supreme Court
a petition for review on certiorari or a motion for extension of
time to file such petition. If such petition or motion is
subsequently filed, the motion for reconsideration pending in
this Court shall be deemed abandoned.

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considering the evidence presented at the trial,
declares categorically what the rights and obligations
of the parties are; or it may be an order or judgment
that dismisses an action. In this case, what should be
deemed the final order the Feb 12 order dismissing
the complaint or the July 1 order denying the MR?
The July 1 order denying the MR. The order denying
the motion for reconsideration is the final order
which finally disposed of the issues involved in
the case. Hence, the reglementary period should
start from the receipt of the order denying the
MR.
On the issue of how many days are left to file a
notice of appeal if the MR is denied, the Court said that
parties are given a fresh period to file a notice of
appeal. A fresh period of 15 days within which to file
the notice of appeal in the Regional Trial Court is given
to appellants, counted from receipt of the order
dismissing a motion for a new trial or motion for
reconsideration. This is also the rule for appeals this
fresh period rule shall also apply to Rule 40 (appeals
from MTC to RTC); Rule 42 (petitions for review from
the RTC to the CA); Rule 43 (appeals from quasi-
judicial agencies to the CA) and Rule 45 governing
appeals by certiorari to the Supreme Court. In sum, a
party litigant may either file his notice of appeal
within 15 days from receipt of the Regional Trial
Courts decision or file it within 15 days from
receipt of the order (the final order) denying
his motion for new trial or motion for
reconsideration. Obviously, the new 15-day
period may be availed of only if either motion is
filed; otherwise, the decision becomes final and
executory after the lapse of the original appeal
period provided in Rule 41, Section 3. (fresh
period rule)
So, given that Neypes had a fresh 15 days to
file a notice of appeal from the receipt of the order
denying his MR (July 22), his filing a notice of appeal
on July 27 was on time.


TAN V CA

Facts: Petitioner Annie Tan, owner of AJ & T Trading,
leased a portion of the ground floor of her building in
Binondo in favor of private respondent Bloomberry
Export Manufacturing. The lease was for five years at
a monthly rental of P20k for the first three years. Tan
filed for ejectment against Bloomberry for several
alleged violations of the lease contract (e.g. failure to
pay rentals on time and encroachment on the adjacent
premises without her consent). Then, Bloomberry tried
to pay the rent, but it was refused by Tan, so
Bloomberry filed a case for consignation. The two
cases were consolidated. MTC Manila ruled that Tan
failed to substantiate her case with that degree of
proof required by law. It dismissed the complaint for
ejectment. Meanwhile, the case for consignation
became moot and academic for Tans failure to appeal
the MTC decision, thus allowing Bloomberry to consign
all due rental payments to the court. On appeal, the
RTC affirmed in toto the decision of the MTC. Tan then
filed an MR of this decision. The MR, however, did not
contain any notice of hearing. Thus, Bloombery filed
an ex-parte Motion for Entry of Judgment upon the
ground that said MR is a mere scrap of paper which
should not merit the attention of the RTC. RTC,
however, set the MR for hearing. CA reversed RTCs
Order.

Issue: Whether the omission of a notice of hearing of
an MR is a fatal defect which does not stop the running
of the period to appeal Yes. Petition denied; CA
decision affirmed.

Ruling: Sections 4 and 5 of Rule 15 of the Rules of
Court are mandatory.

SEC. 4. Hearing of motion.Except for motions which
the court may act upon without prejudicing the rights
of the adverse party, every written motion shall be set
for hearing by the applicant.
Every written motion required to be heard and the
notice of the hearing thereof shall be served in such a
manner as to ensure its receipt by the other party at
least three (3) days before the date of hearing, unless
the court for good cause sets the hearing on shorter
notice.(4a)

SEC. 5. Notice of hearing.The notice of hearing
shall be addressed to all parties concerned, and shall
specify the time and date of the hearing which must
not be later than ten (10) days after the filing of the
motion.(5a)

A motion which does not meet the
requirements of Section 4 and 5 of Rule 15 of the
Rules of Court is considered a worthless piece of paper
which the clerk has no right to receive and the court
has no authority to act upon. Service of copy of a
motion containing notice of the time and place of
hearing of said motion is a mandatory requirement and
the failure of the movant to comply with said
requirements renders his motion fatally defective. This
requirement of notice of hearing equally applies to a
motion for reconsideration. Without such notice, the
motion is pro forma. And a pro forma motion for
reconsideration does not suspend the running of the
period to appeal.
For failing to attach a notice of hearing to the
Motion for Reconsideration, Tan proffers the following
excuses: (1) her former counsels messenger, due to
an honest mistake, inadvertently omitted the fourth
page of the motion containing the crucial Notice of
Hearing; and (2) because of the pressure of work, her
former counsel was unable to follow up such motion
until the day said counsel requested the setting of a
hearing. The Court is not convinced.

First, it is unfair to place the blame for such
omission on the messenger. The burden of preparing
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a complete pleading falls on counsels shoulders, not
on the messengers. Second, it is incredible that the
fourth page containing the Notice of Hearing was left
behind due to honest mistake. In fact, there was no
such page. On the third page, at the end of the
pleading, a copy-furnished notation is found,
indicating that the motion ended exactly there. Tans
counsel simply failed to include a notice of hearing.
Finally, the fact that Tan filed for a Motion to set the
time and date for hearing belies the excuse that an
alleged fourth page had been left behind. What is clear
from the evidence is that said counsel filed the MR only
after Bloomsberry had submitted its Motion for Entry of
Judgment.
A liberal construction of the rule has been
allowed by this Court in the following cases: (1) where
a rigid application will result in a manifest failure or
miscarriage of justice, especially if a party successfully
shows that the alleged defect in the questioned final
and executory judgment is not apparent on its face or
from the recitals contained therein; (2) where the
interest of substantial justice will be served; (3) where
the resolution of the motion is addressed solely to the
sound and judicious discretion of the court; and (4)
where the injustice to the adverse party is not
commensurate with the degree of his thoughtlessness
in not complying with the procedure prescribed. Tan
has failed to demonstrate that the case at bar falls
under any of these exceptions. There is no miscarriage
of justice to speak of. Having failed to observe very
elementary rules of procedure which are mandatory,
Tan caused her own predicament. To exculpate her
from the compulsory coverage of such rules is to
undermine the stability of the judicial process, as the
bench and bar will be confounded by such irritating
uncertainties as when to obey and when to ignore the
Rules.

RULE 38: PETITION FOR RELIEF
FROM JUDGMENT

ALABAN vs. COURT OF APPEALS and FRANCISCO
PROVIDO

FACTS: On Nov. 8, 2000, respondent Francisco
Provido filed a petition with the RTC for the probate of
the Last Will and Testament of the late Soledad
Provido Elevencionado (decedent). Francisco alleged
that he was the heir of the decedent and the executor
of her will. The RTC rendered a Decision, allowing the
probate of the decedents will and directing the
issuance of the letters testamentary to Francisco. More
than 4 months later, Cynthia Alaban and others
(Petitioners), who were claiming to be the intestate
heirs of the decedent, filed a (1) motion for the
reopening of the probate proceedings, (2) an
opposition to the allowance of the will of the decedent,
as well as an (3) opposition to the issuance of the
letters testamentary to Francisco. The RTC, through an
Order, denied Petitioners motion saying that its
Decision was already final and executor even before
their filing of the motion to reopen.
Petitioners then filed a petition seeking the
annulment of the RTCs Decision and Order with the
CA. They claimed that after the death of the decedent,
Petitioners and Francisco held several conferences to
discuss the division of the decedents estate and that a
compromise agreement was drafted by the Petitioner
but Francisco refused to sign it. They opined that
Francisco feigned interest in participating in the
compromise agreement so that they would not suspect
his intention to secure the probate of the will.
Petitioners alleged that they learnt of the probate
proceedings only on Oct. 4, 2001 and that the Decision
must be annulled and set aside on the ground of
extrinsic fraud and lack of jurisdiction of the RTC. The
CA, in its Resolution, dismissed Petitioners petition. It
found that there was no showing that Petitioners failed
to avail of or resort to the ordinary remedies of new
trial, appeal, petition for relief from judgment or other
appropriate remedies through their own fault.

ISSUE: W/N the CA committed GADLEJ when it
dismissed Petitioners petition for the alleged
failure to show that they have not availed of or
resorted to other remedies.

(NOTE: Petitioners contention was that they were not
made parties to the case, the decision of which they
seek to annul, thus, they could not have availed of the
ordinary remedies of new trial, appeal, petition for
relief from judgment and others.)

HELD/RATIO: NO. Petition is DENIED.

Section 37 of the Rules of Court allows an
aggrieved party to file a motion for new trial on the
ground of fraud, accident, mistake, or excusable
negligence. The same Rule permits the filing of a
motion for reconsideration on the grounds of
excessive award of damages, insufficiency of evidence
to justify the decision or final order, or that the
decision or final order is contrary to law. Both motions
should be filed within the period for taking an appeal,
or fifteen (15) days from notice of the judgment or
final order. Meanwhile, a petition for relief from
judgment under Section 3 of Rule 38 is resorted to
when a judgment or final order is entered, or any other
proceeding is thereafter taken, against a party in any
court through fraud, accident, mistake, or excusable
negligence. Said party may file a petition in the same
court and in the same case to set aside the judgment,
order or proceeding. It must be filed within sixty (60)
days after the petitioner learns of the judgment and
within six (6) months after entry thereof. A MNT or
reconsideration and a petition for relief from
judgment are remedies available only to parties
in the proceedings where the assailed judgment
is rendered. In fact, it has been held that a person
who was never a party to the case, or even summoned
to appear therein, cannot avail of a petition for relief
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from judgment. However, Petitioners in this case are
mistaken in asserting that they are not or have not
become parties to the probate proceedings.
Under the Rules of Court, any executor,
devisee, or legatee named in a will, or any other
person interested in the estate may, at any time after
the death of the testator, petition the court having
jurisdiction to have the will allowed. Notice of the time
and place for proving the will must be published for
three (3) consecutive weeks, in a newspaper of
general circulation in the province, as well as furnished
to the designated or other known heirs, legatees, and
devisees of the testator. A proceeding for the
probate of a will is one in rem, such that with the
corresponding publication of the petition the court's
jurisdiction extends to all persons interested in said will
or in the settlement of the estate of the decedent. It is
the publication of such notice that brings in the
whole world as a party in the case and vests the
court with jurisdiction to hear and decide it. Thus,
even though petitioners were not mentioned in
the petition for probate, they eventually became
parties thereto as a consequence of the
publication of the notice of hearing. As parties to
the probate proceedings, petitioners could have
validly availed of the remedies of motion for new
trial or reconsideration and petition for relief
from judgment. In fact, petitioners filed a motion to
reopen, which is essentially a motion for new trial, with
petitioners praying for the reopening of the case and
the setting of further proceedings. However, the
motion was denied for having been filed out of time,
long after the Decision became final and executory.
Conceding that petitioners became aware of
the Decision after it had become final, they could have
still filed a petition for relief from judgment after the
denial of their motion to reopen. Petitioners claim that
they learned of the Decision only on 4 October 2001 (4
months from the time the Decision had attained
finality). But they failed to avail of the remedy. For
failure to make use without sufficient justification of
the said remedies available to them, petitioners could
no longer resort to a petition for annulment of
judgment; otherwise, they would benefit from their
own inaction or negligence.


SAMARTINO v. RAON, CRISOSTOMO

FACTS: Raon (sister) and Crisostomo (husband) are
the surviving heirs of the late Filomena Bernardo-
Crisostomo. Among the properties left by Filomena is
her share in a parcel of land in Noveleta, Cavite,
with TCT registered in the names of co-owner Filomena
Bernardo and Lido Beach Corporation.
Raon and Crisostomo filed an ejectment case
against Regalado Samartino before the MTC of
Noveleta, Cavite, alleging that during the lifetime of
Filomena she leased her share in the property to
Regalado Samartino for a period of 5 years counted
from 1986; that the lease expired and was not
extended; and that Samartino refused to vacate the
property despite demands.
Summons was served on the brother of
Regalado Samartino (Roberto) because at that time ,
Samartino was confined at the National Bureau of
Investigation Treatment and Rehabilitation Center
(NBI-TRC) undergoing treatment and rehabilitation for
drug dependency. Thus a liaison officer of the NBI-TRC
appeared before the trial court with a certification that
Samartino will be unable to answer the complaint
within the reglementary period, inasmuch as it will
take six months for him to complete the rehabilitation
program and before he can be recommended for
discharge
MTC, despite the written certification from NBI-
TRC, granted Raon and Crisostomos motion to declare
Samartino in default, allowed presentation of
evidence ex-parte. On March 21, 1996, MTC ruled in
favor of Raon and Crisostomo.
RTC affirmed. Decision became final. A
Writ of Execution was issued.
Samartino filed with RTC of Cavite, a petition
for relief from judgment. He also submitted an affidavit
of merit alleging that the parcel of land from which he
was being evicted had been sold to him by Filomena
Bernardo-Crisostomo, as evidenced by the Deed of
Absolute Sale. This was dismissed by the RTC on the
ground that it was filed out of time. Two MRs were also
denied.

ISSUE: WON the RTC erred in denying the petition for
relief for being filed out of timeYES

RATIO: According to the RTC, the petition for relief,
filed on November 25, 1996, was late because
Samartino had actual knowledge of the judgment in
the ejectment case since March 1996 (MTC
decision). This is wrong. The period within which to
file a petition for relief should have been reckoned
from the date he learned of the RTC judgment on the
ejectment case. It should not have been counted
from the date of the MTCs decision because,
precisely, Samartino timely appealed the same.
It was the RTCs decision that became final and,
hence, was the proper subject of the petition for
relief from judgment. A petition for relief is only
available against a final and executory judgment.
Section 3, Rule 38: a verified petition for relief
must be filed within sixty (60) days after the petitioner
learns of the judgment, final order, or other
proceeding to be set aside and not more than six (6)
months after such judgment or final order has been
entered or such proceeding has been taken. It must be
accompanied with affidavits showing the fraud,
accident, mistake, or excusable negligence relied upon,
and the facts constituting petitioners good and
substantial cause of action or defense.
It is not clear from the records of the case at
bar when Samartino learned of the decision of the RTC
affirming the judgment of theMTC. What appears is
that the said decision became final only on August
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15, 1996, and must have been entered sometime
thereafter. Hence, the petition for relief filed on
November 25, 1996 was well within the six-month
period prescribed by the Rules.

OTHER NOTES: (On summons) Service of summons
upon the defendant shall be by personal service first
and only when the defendant cannot be promptly
served in person will substituted service be availed of.
In this case, the sheriffs return failed to show
the reason why personal service could not be made
(that prompt and personal service on the defendant
was impossible, the efforts made to find defendant
personally and that said efforts failed hence the resort
to substituted service). It also failed to state that
petitioners brother, on whom substituted service of
summons was effected, was a person of suitable age
and discretion residing at petitioners residence. Thus,
ineffective substituted service. So the trial court did
not acquire jurisdiction over the person of Samartino.
Thus, judgement null and void. CASE REMANDED TO
MTC.

RULE 39: EXECUTION OF JUDGMENT

Sps. CAPA v. CA

FACTS: Spouses Capa owned a motor banca (M/B CLM
Zoltan), which they used for their fish trading
business. Private respondent United Vismin Shipping
Lines owned a motorized vessel (M/V Cebu Pearl),
manned by Capt. Yhapon.
One fateful evening in April 1993, the 2 vessels
collided in the waters of Dumaguete, resulting into the
sinking of Zoltan.
Aug. 1993, Capa spouses filed a complaint for
damages with RTC Cebu, against Vismin and spouse of
Yhapon.
RTC Cebu ruled in favor of spouses Capa. It
ordered Vismin and Yhapon to pay actual, moral,
exemplary damages, loss of profits, attys fees and
litigation expenses.
Spouses Cada filed an Urgent Motion for
Execution Pending Appeal, claiming that Vismin
already gave notice to the MARINA that it was ceasing
its operations. A few days after this urgent motion was
filed, Vismin and Yhapon filed their notice of appeal.
The RTC granted petitioners' motion for
execution after petitioners' submission of a certification
from MARINA that Vismin had suspended operation of
its five vessels. A writ of execution pending appeal was
issued to Sheriff Belarmino. Sheriff issued a notice of
levy, addressed to the Regional Director of the
MARINA, levying on 2 vessels registered under
Vismins name.
The levy prompted the other private
respondent Jocelyn Raco, through her attorney-in-fact
Tolosa, to file a Third-Party Claim, claiming ownership
over the vessels levied upon by the sheriff. A notice of
the claim was sent to petitioners by Sheriff Belarmino
who required the Cadas to file an indemnity bond in
the amount of P2.7 million.
Vismin and Yhapon filed a Motion to Quash
Levy on the ground that petitioner Cadas were not
required to put up a bond in favor of Vismin (as
security in case the appealed decision will be
reversed). RTC however, didnt rule on this motion
because it lost jurisdiction with the perfection of the
appeal.
In the CA, petitioner Cada filed a motion to
approve sheriffs indemnity bond, for the levy of the
subject vessel. 3
rd
party claimant Raco filed an
opposition. But, the CA eventually denied the motion
to approve sheriffs indemnity bond. MR denied.
Cada spouses thereafter filed with the CA a
Motion to Deny Third Party Claim. They assert that it
wasnt Raco who really signed the claim, but mere the
atty-in-fact Tolosa. That was when CA issued its
assailed resolution in this case. CA just took note of
the motion to deny 3
rd
party complaint. CA held that
said motion should have been filed with the Regional
Trial Court of Cebu, not CA.
Cada spouses now say CA acted with GADLEJ
in refusing to rule on the motion to deny 3
rd
party
claim because Cada believes that the RTC already lost
jurisdiction. Also, petitioners argue that the third-party
claim is a nullity since the affidavit where third-party
claimant Raco stated that she is the owner and has the
right to possess the levied properties, was not signed
by her but by Tolosa, her attorney in-fact.
On the other hand, private respondents aver
that the third party claim was filed in accordance with
Section 16, Rule 39 of the Rules of Court; that the levy
was never perfected because of petitioners' failure to
have the sheriff's indemnity bond approved by the CA,
Same position is taken by Vismin and Yhapon.

ISSUE: W/N the CA committed grave abuse of
discretion when it did not act on petitioners' Motion to
Deny Third-Party Claim with Motion to Admit Claim for
Damages on the ground that the same should have
been filed with the Regional Trial Court of Cebu.

HELD/RATIO: No. Decision affirmed. RTC has
jurisdiction to issue execution pending appeal.
HOWEVER, unfortunately appeal was not
perfected. There is a valid 3
rd
party claim.
Section 9, Rule 41 of the Rules of Court
explains that the trial court loses jurisdiction over a
case upon perfection of appeal. A party's appeal by
notice of appeal is deemed perfected as to him upon
the filing of the notice of appeal in due time. xxxx In
appeals by notice of appeal, the court loses jurisdiction
over the case upon the perfection of the appeals filed
in due time and the expiration of the time to appeal of
the other parties.
In either case, prior to the transmittal of
the original record or the record on appeal, the
court may issue orders for the protection and
preservation of the rights of the parties which do
not involve any matter litigated by the appeal,
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approve compromises, permit appeals of indigent
litigants, order execution pending appeal in
accordance with Section 2 of Rule 39, and allow
withdrawal of the appeal.
On the other hand, Section 2, Rule 39 provides:
SEC. 2. Discretionary execution.
(a) Execution of a judgment or a final order
pending appeal. On motion of the prevailing
party with notice to the adverse party filed in
the trial court while it has jurisdiction over the
case and is in possession of either the original
record or the record on appeal, as the case
may be, at the time of the filing of such
motion, said court may, in its discretion, order
execution of a judgment or final order even
before the expiration of the period to appeal.
After the trial court has lost jurisdiction, the
motion for execution pending appeal may be
filed in the appellate court.
Discretionary execution may only issue upon
good reasons to be stated in a special order
after due hearing.
Clearly, as long as the motion for
execution pending appeal is filed within the
period for perfecting the appeal and prior to the
transmittal of the records to the CA, the trial
court may order execution pending appeal upon
good reasons to be stated in the Order granting
execution pending appeal. The trial court granted
petitioners' motion for execution pending appeal and
issued the writ of execution commanding sheriff
Belarmino to levy the properties of United Vismin.
However, a third party-claim was filed by
Raco through her attorney-in-fact Tolosa
pursuant to Section 16, Rule 3.
In this case, Raco availed of the remedy known
as terceria, by serving on the officer making the levy
an affidavit of his title and a copy thereof upon
petitioners. Upon receipt of such affidavit, sheriff
Belarmino who is not bound to keep the properties
because of such third party claim, notified petitioners
of such claim and required them to post an indemnity
bond in the amount of P2,700,000.00 on February 4,
2002 to answer for any liability he may incur by reason
of such execution. The matter of the invalidity of
the affidavit of the third-party claimant was
never raised by petitioners in the trial court
which could have still ruled on the same since
the records were still with it at the time such
third party claim was filed. Moreover, petitioners
even filed an indemnity bond.
Petitioners then filed a Motion to Deny Third-
Party Claim with Motion to Admit Claim for Damages
which is a complete turn around from their motion to
approve indemnity bond. The CA did not commit grave
abuse of discretion in not acting on the same since the
invalidity of the affidavit of third-party claim should
have been raised at the earliest opportunity which is in
the trial court. Petitioners could have then moved for
the quashal of the same, thus they could not now
invoke the jurisdiction of the CA to rule on the same
when they in fact had already waived the alleged
defect in the affidavit when they sought from the CA
the approval of the indemnity bond they posted in the
trial court.
A third party claimant or any third person may
vindicate his claim to his property wrongfully levied by
filing a proper action which is distinct and separate
from that in which the judgment is being enforced.
Such action would have for its object the recovery of
the possession of the property seized by the sheriff, as
well as damages resulting from the allegedly wrongful
seizure and detention thereof despite the third-party
claim; and it may be brought against the sheriff, of
course, and such other parties as may be alleged to
have colluded with the sheriff in the supposedly
wrongful execution proceedings, such as the judgment
creditor himself.
The same paragraph also provides a remedy to
a judgment obligee when a frivolous and plainly
spurious claim was filed by a third-party claimant, i.e.,
to file his claim for damages in the same court where
the third-party claimant filed his third-party claim or to
file a separate action.


NAVAROSA V. COMELEC

Facts:
Petitioner Charito Navarosa and respondent
Roger Esto were mayoral candidates for the
city of Libacao in Aklan during the May 2001
elections. The COMELEC proclaimed Navarosa
as winner by three votes. Alleging
irregularities, Esto then filed an election
protest before the Kalibo RTC, with Navarosa
filing a counter-protest.
The RTC ruled in favor of Esto, declaring that
Esto won by 42 votes over Navarosa. While
Navarosa appealed the RTC's ruling before the
COMELEC, Esto filed a motion for execution of
judgment pending appeal. Navarosa offered to
stay execution by filing a supersedeas bond.
The RTC granted both motions subject to the
filing of bonds, ruling that the SC has
recognized executions of judgments pending
appeal in election cases in accordance with
Sec. 2, Rule 39. Esto filed a petition for
certiorari with the COMELEC against the RTC.
The COMELEC affirmed the RTC's order
granting execution pending appeal and nullified
the stay of execution.

Issue: Can the RTC stay executions pending appeal in
an election contest?

Held: No. Sec. 3 of Rule 39 not applicable to election
cases.
While present election laws are silent as to
execution pending appeal in election protests,
Sec. 2 (providing for execution pending
appeal), Rule 39 applies in suppletory
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character. The primordial public interest of
preventing delays in the exercise of office by
the protestant by prolonging the protest
justifies the suppletory application.
Nevertheless, Sec. 3 (providing for
discretionary execution) of Rule 39 does not
apply to election cases. It can only find
application in ordinary civil application where
the judgments and orders are capable of
pecuniary estimation. Said characteristics are
absent in election cases and the underlying
public interest renders a supersedeas bond
insufficient.


INTERNATIONAL SCHOOL v. CA and SPOUSES
TORRALBA

FACTS: The RTC of QC rendered a decision in a civil
case entitled Spouses Alex and Ophelia Torralba v.
International School, Inc. (Manila), Dr. Rodney C.
Hermes, Noli Reloj and Danilo de Jesus involving a
complaint for damages due to the death of the
spouses only son, Ericson, while in the custody of
International School (ISM) and its officers. The RTC
ruled in favor of the defendants and dismissed the
complaint of the Torralbas. ISM appealed to the CA.
During the pendency of the appeal, the
spouses filed a motion for execution pending appeal
before the lower court on the grounds that the appeal
is merely dilatory and that the filing of the bond is
another good reason for the execution of a judgment
pending appeal. This was opposed by ISM.
The lower court granted execution pending
upon the posting of a bond in the amount of P5 million
by the spouses. In an ex-parte motion, Deputy Sheriff
Doroni informed the lower court to the Writ of
Execution Pending Appeal issued by the court, a Notice
of Garnishment of ISM's bank deposits at Global
Consumer Banking, Citibank N.A. (Citibank) was
served by him to Citibank on July 18, 1996; and that
on July 24, 1996, he received a letter from Citibanks
informing him that ISM's bank deposits with the said
bank in the amount of P5.5 million were on
"hold/pledge". In the meantime, ISM filed a motion for
reconsideration or for approval of supersedeas bond in
the amount of P5.6 million.
The lower court issued an Order directing
Citibank to release to Deputy Sheriff Doroni in cash or
check the P5.5 million, subject of the Notice of
Garnishment.The following day, the spouses Torralba
filed an urgent ex parte motion to encash and receive
the proceeds of the Citibank Manager's check
representing the amount garnished in execution. ISM
filed an urgent motion to stop delivery of garnished
funds to the spouses Torralba. The lower court issued
an order suspending the execution process there being
no opposition filed in relation thereto and pending
resolution of ISM's motion for reconsideration (or to
approval of supersedeas bond). The spouses Torralba
then filed an opposition to ISM's motion for
reconsideration.
The lower court denied ISM's motion for
reconsideration and authorized and directed Deputy
Sheriff Doroni to encash the Citibank Manager's Check
payable to the said court in the amount of P5.5 million
and to turn over the proceeds therefor after deducting
all legal fees and charges if any, to the plaintiffs or
their representative.
ISM filed a petition for certiorari before the CA,
seeking the nullification of the assailed orders for
having been issued in excess of jurisdiction and with
grave of discretion. CA dismissed the petition for lack
of merit. Hence, ISM brought the case to the SC.

ISSUE:
(1) Whether or not the respondent Court of Appeals
erred in finding that the lower court did not commit
any grave abuse of discretion in granting execution
pending appeal of its decision YES
(2) Whether or not the filing of a bond can be
considered a good reason to justify immediate
execution under Section 2, Rule 39 NO

HELD:
(1) In upholding the writ of execution pending
appeal, the Court of Appeals observed that the lower
court had, prior to it its issuance, duly noted the
presence of the circumstances laid down by Section 2,
Rule 39 of the Rules of Court,
23
allowing execution as
an exception, or pending appeal, even before final
Judgment, to wit:
(a) There must be a motion by the prevailing party
with notice to the adverse party;
(b) There must be good reasons for issuing the
execution; and
(c) The good reasons must be stated in a special
order.
Likewise, the Court of Appeals accepted as
"good reasons" that ISM's appeal appears to be
dilatory in view of its virtual admission of fault when it
adopted the project "Code Red" consisting of safety
and emergency measures only after the death of
plaintiffs-spouses Torralba's son, and the delay of the
case which already affected plaintiffs spouses Torralbas
financially.
For purposes only of determining the
correctness of the writ of execution pending appeal,
the SC could not see how the lower courts came upon
the conclusion of virtual admission of fault or
negligence by ISM based on ISM's swimming coachs
admission that he read the school paper article
introducing "Code Red". As correctly pointed out by
ISM, the article was not an official statement of the
school, but merely an opinion of its author. Moreover,
the statement of Mr. Noli Reloj that he read the article
on "Code Red" cannot be construed as an admission of
liability by the school. Clearly then, the conclusion of
the lower courts that the appeal is dilatory based solely
on the foregoing exchange rests on shaky ground.

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(2) The Court cited the case of Roxas v. CA and
held that the mere filing of a bond by the successful
party is not a good reason for ordering execution
pending appeal, as "a combination of circumstances is
the dominant consideration which impels the grant of
immediate execution, the requirement of a bond is
imposed merely as an additional factor, no doubt for
the protection of the defendant's creditor. Since the
have already ruled that the reason that an appeal is
dilatory does not justify execution pending appeal,
neither does the filing of a bond, without anything
more, justify the same.
(The court also noted that writ of execution
pending appeal covered the moral and exemplary
damages adjudged by the lower court against ISM.)


MANACOP v. EQUITABLE PCI BANK

FACTS: Lavine Loungewear Manufacturing (Lavine)
insured its building & supplies against fire w/ PhilFire,
Rizal Suret, TICO, First Lepanto, Equitable Insurance &
Reliance Insurance. Except for the policy issued by
First Lepanto, all the policies provide that: Loss, if
any, under this policy is payable to Equitable Banking
Corporation-Greenhills Branch, as their interest may
appear subject to the terms, conditions, clauses and
warranties under this policy.
A fire gutted Lavines buildings & their
contents, thus claims were made against the policies.
The insurance proceeds payable to Lavine amounted to
about P112M. The insurance companies expressed
their willingness to pay the insurance proceeds, but
only to the rightful claimant. (Lavine was indebted to
Equitable Bank, and there was a dispute as to whether
the insurance proceeds should be paid directly to
Equitable Bank, or to Lavine first who would then pay
Equitable Bank.)
The RTC ruled in favor of petitioners & ordered
the insurance companies to pay Lavine, as well as
Equitable Bank to refund Lavine. First Lepanto,
PhilFire, Rizal Surety, and Equitable Bank filed a Notice
of Appeal. Meanwhile, petitioners filed a Motion for
Execution Pending Appeal. Judge Lavina granted the
Motion for Execution Pending Appeal & issued a Writ of
Execution.
Without filing an MR from the decision of the
RTC, and even before the RTC could rule on the Motion
for Execution Pending Appeal, Equitable Bank filed a
Petition for Certiorari. Its Petition for Certiorari assailed
the RTC decision (and NOT the order granting the
Motion for Execution Pending Appeal & the Writ of
Execution).
On the other hand, First Lepanto & Philfire filed
a Petition for Certiorari assailing the RTCs order
granting the Motion for Execution Pending Appeal &
the Writ of Execution.

ISSUE:
(a) W/N the Petition for Certiorari assailing the RTC
judgment was proper.
(b) W/N the Petition for Certiorari assailing the order
granting the Motion for Execution Pending Appeal &
the Writ of Execution was proper.

RULING:
(a) NO. Simultaneous filing of a petition for certiorari
under Rule 65 and an ordinary appeal under Rule 41
cannot be allowed since 1 remedy would necessarily
cancel out the other. The existence & availability of the
right of appeal proscribes resort to certiorari because
one of the requirements for availment of the latter is
precisely that there should be no appeal. It is
elementary that for certiorari to prosper, it is not
enough that the trial court committed GADLJEC; the
requirement that there is no appeal, nor any plain,
speedy & adequate remedy in the ordinary course of
law must likewise be satisfied.
It is well-settled that the remedy to obtain
reversal or modification of the judgment on the merits
is appeal. This is true even if the error, or 1 of the
errors, ascribed to the trial court rendering the
judgment is its lack of jurisdiction over the subject
matter, or the exercise of power in excess thereof, or
grave abuse of discretion in the findings of fact or of
law set out in the decision. Thus, while it may be true
that a final order or judgment was rendered under
circumstances that would otherwise justify resort to a
special civil action under Rule 65, the latter would
nonetheless be unavailing if there is an appeal or any
other plain, speedy & adequate remedy in the ordinary
course of law.

(b) YES. An appeal from a judgment does NOT bar a
certiorari petition against the order granting execution
pending appeal & the issuance of the writ of execution.
Certiorari lies against an order granting execution
pending appeal where the same is not founded upon
good reasons.2 The fact that the losing party had also
appealed from the judgment does NOT bar the
certiorari proceedings, as the appeal could not be an
adequate remedy from such premature execution.
Additionally, there is no forum-shopping where in 1
petition a party questions the order granting the
motion for execution pending appeal & at the same
time questions the decision on the merits in a regular
appeal before the appellate court. After all, the merits
of the main case are not to be determined in a petition
questioning execution pending appeal & vice versa.
Since the execution of a judgment pending
appeal is an exception to the general rule, the
existence of good reasons is essential. In the case at
bar, petitioners insist that execution pending appeal is
justified because the insurance companies admitted
their liabilities under the insurance contracts and thus
have no reason to withhold payment. We are not
persuaded. The fact that the insurance companies
admit their liabilities is not a compelling or superior
circumstance that would warrant execution pending
appeal. On the contrary, admission of their liabilities &
willingness to deliver the proceeds to the proper party
militate against execution pending appeal since there
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is little or no danger that the judgment will become
illusory.
There is likewise no merit in petitioners
contention that the appeals are merely dilatory
because, while the insurance companies admitted their
liabilities, the matter of how much is owing from each
of them & who is entitled to the same remain
unsettled. Besides, that the appeal is merely dilatory is
not a good reason for granting execution pending
appeal.
Lastly, petitioners assert that Lavines financial
distress is sufficient reason to order execution pending
appeal. Citing Borja v. CA, they claim that execution
pending appeal may be granted if the prevailing party
is already of advanced age & in danger of extinction.
Borja is not applicable to the case at bar
because its factual milieu is different. In Borja, the
prevailing party was a natural person who, at 76 years
of age, may no longer enjoy the fruit of the judgment
before he finally passes away. Lavine, on the other
hand, is a juridical entity whose existence cannot be
likened to a natural person. Its precarious financial
condition is not by itself a compelling circumstance
warranting immediate execution & does not outweigh
the long standing general policy of enforcing only final
and executory judgments.


CURATA V PPA

FACTS: (its a very complicated case composed of 7
consolidated cases but for our topic I pinpointed the
relevant facts nalang)
2 Executive orders (385 and 431) placed the
BPZ under the PPAs jurisdiction in pursuance of this
the PPA instituted expropriation proceedings for 185
lots represented by 231 individuals and entities. The
PPA offered to pay for just compensation which the
parties rejected. The defendants were divided into 3
groups: Dimayacyac, Ortega and Cruz Groups. There
were also individuals not included in the groups.
THE FIRST COMPENSATION ORDER
The RTC ordered the expropriation of the lots
so the Commissioners were asked to conduct a report
and later the RTC gave their first compensation order
ordering the PPA to pay the Dimayacyac group 5500
instead of 4800 as recommended. Dimayacyac moved
for execution citing that the group consisted of
members who were of advanced age which was
opposed by PPA but which was nevertheless allowed by
the RTC in the July 24, 2000 Order granting the motion
of execution.
July 31, 2000- RTC issued Order issuing a writ
of execution.
August 2 and 3 - Then a notice of
garnishment was issued to LBP Batangas City Branch
by Sheriff Quino.
August 10- PPA filed a "Notice of Appeal with
Motion for Extension of Time to File Record on Appeal
and Pay Appeal Fee."
August 25- Within the period of extension
requested, PPA filed its Record on Appeal. The RTC
issued an Order denying PPAs Notice of Appeal from
the July 10, 2000 Order (First Compensation Order) on
the ground of non-payment of appeal fee.
August 28 Order- the RTC denied PPAs Record on
Appeal.
September 18- the RTC denied PPAs Motion for
Reconsideration of the August 25, 2000 RTC order.
PPA challenged the execution pending appeal of the
July 24 Order, the July 31 Order and the August 2 and
3 Notices of Garnishment. In its supplemental petition,
PPA assailed the August 25, Order which denied PPAs
motion, the August 28 Order which denied the PPAs
record on appeal and the September 18 Order which
denied PPAs motion for reconsideration.
The CA allowed the appeal of PPA and nullified
the questioned RTC orders.
Curata et al now assail the CA order allowing
PPAs appeal despite the alleged finality of the July 10,
2000 Order (First Compensation Order).

ISSUE: W/n execution pending appeal is applicable to
expropriation proceedings? NO!

HELD: SC ruled that discretionary execution of
judgments pending appeal under Sec. 2(a) of Rule 39
does not apply to eminent domain proceedings.
In Visayan Refining Co. v. Camus and Paredes,
When the Government is plaintiff the judgment will
naturally take the form of an order merely requiring
the payment of the award as a condition precedent to
the transfer of the title, as a personal judgment
against the Government could not be realized upon
execution.
In Commissioner of Public Highways v. San
Diego, Chief Justice Teehankee explained the
rationale on why government funds and properties
cannot be seized under a writ of execution, thus:
The universal rule that where the State gives
its consent to be sued by private parties either by
general or special law, it may limit claimants action
"only up to the completion of proceedings anterior to
the stage of execution" and that the power of the
Courts ends when the judgment is rendered, since
government funds and properties may not be seized
under writs of execution or garnishment to satisfy such
judgments, is based on obvious considerations of
public policy. Disbursements of public funds must be
covered by the corresponding appropriation as
required by law. The functions and public services
rendered by the State cannot be allowed to be
paralyzed or disrupted by the diversion of public funds
from their legitimate and specific objects, as
appropriated by law.
PPAs monies, facilities and assets are
government properties so they are exempt from
execution whether by virtue of a final judgment
or pending appeal. PPA funds may not be garnished
absent an allocation by its Board or by statutory grant.
If the PPA funds cannot be garnished and its
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properties, being government properties, cannot be
levied via a writ of execution pursuant to a final
judgment, then the trial court likewise cannot grant
discretionary execution pending appeal, as it would run
afoul of the established jurisprudence that government
properties are exempt from execution. What cannot be
done directly cannot be done indirectly.


GARCIA v. PAL

Facts: PAL filed administrative charges against
petitioners (employees) after they were caught in the
act of sniffing shabu when a team of company security
personnel raided the PAL Center. They were dismissed
after due notice, which prompted them to file a
complaint for illegal dismissal and damages.
The Labor Arbiter ruled in their favor and
ordered PAL to immediately comply with the
reinstatement aspect of the decision. But prior to this,
the SEC placed PAL under rehabilitation receivership
due to severe financial losses. On appeal, the NLRC
reversed the decision. However, the Labor Arbiter
subsequently issued a Writ of Execution on the
reinstatement aspect and Notice of Garnishment. The
NLRC affirmed their validity but suspended and
referred the action to the Rehabilitation Receiver.
PAL went to the CA, arguing that the
subsequent finding of a valid dismissal removes the
basis for implementing the reinstatement aspect of the
decision and the impossibility to comply with such due
to corporate rehabilitation. The CA partially granted
the petition and reinstated the NLRC Resolution insofar
as it suspended the proceedings. Subsequently, SEC
granted PALs request to exit from rehabilitation
proceedings.

Issues:
1. Whether the LAs order of reinstatement is
immediately executory pending appeal YES
2. Whether it is obligatory on the part of the
employer to reinstate and pay wages during
the period of appeal despite reversal of said
order YES
3. Given these, whether petitioners are entitled to
their salaries - NO

Ratio:
Immediate Execution of Reinstatement Order
The SC cites seemingly divergent decisions
concerning reinstatement pending appeal, or
particularly, the option of payroll reinstatement. One
view is that a dismissed employee whose case was
favorably decided by the LA is entitled to receive
wages pending appeal upon reinstatement, which is
immediately executory. Unless there is a restraining
order, it is ministerial upon the LA to implement the
order of reinstatement and it is mandatory on the
eployer to comply therewith (Air Philippines v.
Zamora). The other view is found in the case of
Genuino v. NLRC, which says that if the decision of the
LA is later reversed on appeal upon the finding that the
ground for dismissal is valid, then the employer has
the right to require the dismissed employee on payroll
reinstatement to refund the salaries received while the
case was pending on appeal. However, if the
employee was reinstated to work during the pendency
of the appeal, he is entitled to compensation for actual
services rendered without need of refund.
PAL argues that there is no point in releasing
the wages to petitioners since their dismissal was
found to be valid, and to do so would constitute unjust
enrichment. But the SC said that the social justice
principles of labor law outweigh the civil law doctrine of
unjust enrichment. The Genuino ruling not only
disregards the social justice principles but also
institutes a scheme unduly favorable to management.
Under such, the salaries dispensed pendent lite merely
serves as a bond posted in installment by the
employer. For in the event of reversal, the employer
gets back the same amount without having to spend
ordinarily for bond premiums. This contradicts the
proscription that the posting of a bond by the
employer shall not stay the execution for
reinstatement.
The SC reaffirms the prevailing principle that
even if the order of reinstatement of the LA is reversed
on appeal, it is obligatory on the part of the employer
to reinstate and pay the wages of the dismissed
employee during the period of appeal until reversed by
the higher court. The LAs order of reinstatement is
immediately executory and the employer either has to
re-admit them to work under the same terms and
conditions, or to reinstate them in payroll, and that
failing to exercise the options in the alternative, the
employer must pay the employees salaries.

(Note: Separate opinion of Justice Velasco supports
the Genuino case and finds Air Philippines to be
inapplicable because the writ of execution therein was
secured prior to the reversal of the LAs decision,
unlike in the present case)

Fact of Corporate Rehabilitation
After the LAs decision is reversed, the employee may
be barred from collecting the accrued wages if it is
shown that the delay in enforcing the reinstatement
pending appeal was without fault on the part of the
employer. While reinstatement pending appeal aims to
aver the continuing threat or danger to the survival of
the employee and his family, it does not contemplate
the period when the employer-corporation itself if
similarly in a judicially monitored state of being
resuscitated in order to survive.


ARCENAS V CA

Facts: The case takes its roots from Civil Case No.
35349 (1
st
CASE) of the Court of First Instance of Rizal
(now Regional Trial Court), which was an action for
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annulment of the foreclosure sale of a barge. After
trial, the trial court rendered judgment.
The trial court ordered only Arcenas co-
defendant Emilio Espino to return the barge MV Sta.
Lucia I to Jose de la Riva and to pay P 48,000.00 a
month as unrealized profit from February 3, 1980 or
until June 18, 1980. The said judgment absolved
petitioner from any liability insofar as the barge is
concerned but found him jointly liable to private
respondent and Antonio Sy, Sr., for moral and
exemplary damages.
De la Riva filed a motion for issuance of a writ
of execution with the trial court. This was granted.
However, despite the writ of execution, private
respondent failed to enforce the judgment.
Five (5) years from the time of the entry of
judgment, de la Riva filed a complaint for revival of
judgment and sum of money with damages before the
Regional Trial Court of Pasig (2
nd
CASE). The complaint
alleged that Arcenas could be served with summons at
BF Homes, Pamplona Las Pias, Metro Manila.
The sheriff returned the summons unserved for
the reason that Arcenas was already residing in the
United States. Alias summons was served on his
mother by substituted service.
Arcenas failed to file his answer and was
declared in default. Thereafter, de la Riva was allowed
to adduce his evidence ex-parte. The trial court
rendered a decision against Arcenas. This revived
judgment now subject of this case, substantially
modified the original judgment by directing Arcenas to
pay private respondent the sum of P171,022.00
representing double the value of the barge;
P10,000.00 as moral and exemplary damages; and
15% of the amount recoverable by way of attorneys
fees.
Arcenas filed a petition with the CA to annul
the said revived judgment on the ground that, the RTC
did not acquire jurisdiction over his person and that
the revived judgment substantially altered the original
judgment. CA denied.

Issue:
Did the court acquire jurisdiction over his
person? (side issue)
Is the revived judgment void for substantially
altering the original judgment? (pertinent
issue)

Held:
Did the court acquire jurisdiction over his person?
NO. Arcenas was no longer residing and found in the
Philippines. He left for the United States in June of
1993 as evidenced by the Sheriffs Return. Hence,
summons could have been served on him either
personally or by publication. However, since the
complaint filed against him was one in personam and
did not involve the personal status of the private
respondent, nor any property in the Philippines in
which Arcenas had or claimed an interest, or which de
la Riva had attached, summons should have been
served on him personally. The deputy sheriff should
not have served the summons by substituted service.
Having failed to serve the summons on the person of
the petitioner, the Regional Trial Court did not validly
acquire jurisdiction over him.

Is the revived judgment void for substantially
altering the original judgment?
In the 1
st
case, the judgment of the trial court ordered
only petitioners co-defendant Emilio Espino to return
the barge MV Sta. Lucia I to private respondent Jose
de la Riva and to pay P 48,000.00 a month as
unrealized profit from February 3, 1980 or until June
18, 1980. The said judgment absolved petitioner from
any liability insofar as the barge is concerned but
found him jointly liable to private respondent and
Antonio Sy, Sr., for moral and exemplary damages. On
the other hand, the revived judgment now subject of
this case, substantially modified the original judgment
by directing petitioner to pay private respondent the
sum of P171,022.00 representing double the value of
the barge; P10,000.00 as moral and exemplary
damages; and 15% of the amount recoverable by way
of attorneys fees.
These new monetary awards can not be
allowed since they were not adjudged in the original
judgment which had long become final and executory.
For, it is a fundamental rule that when a final
judgment becomes executory, it thereby becomes
immutable and unalterable. The judgment may no
longer be modified in any respect, even if the
modification is meant to correct what is perceived to
be an erroneous conclusion of fact or law, and
regardless of whether the modification is attempted to
be made by the court rendering it or by the highest
Court of the land. The only recognized exceptions are
the correction of clerical errors or the making of so-
called nunc pro tunc entries which cause no prejudice
to any party, and, of course, where the judgment is
void. Any amendment or alteration which substantially
affects a final and executory judgment is null and void
for lack of jurisdiction, including the entire proceedings
held for that purpose.


INFANTE V. ARAN BUILDERS

Facts:
Aran Builders filed before the RTC of
Muntinlupa City an action for revival of
judgment against Infante
The judgment sought to be revived was
rendered by the Makati RTC which is an action
for specific performance and damages
Infante filed a motion to dismiss the action for
revival of judgment on the grounds that
Muntinlupa RTC has no jurisdiction over the
persons of the parties and that venue was
improperly laid. Aran Builders opposed the
motion
Muntinlupa RTC denied the motion to dismiss
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due to the following reasons:
1. When the decision was rendered by the
Makati RTC, there was still no RTC in
Muntinlupa
2. The case at bar is a revival of a judgment
which declared the plaintiff as the owner of
a parcel of land located in Muntinlupa City.
It is this judgment which is sought to be
enforced thru this action which necessarily
involves the interest, possession, title, and
ownership of the parcel of land located in
Muntinlupa city and adjudged to Infante.
Hence, the complaint should be filed in
Muntinlupa City where the property is
located, as there are now Regional Trial
Courts in said city
MR denied by Muntinlupa RTC
CA ruled in favor of Aran Builders. CA held that
since the judgment sought to be revived was
rendered in an action involving title to or
possession of real property, or interest therein,
the action for revival of judgment is then an
action in rem which should be filed with the
Regional Trial Court of the place where the real
property is located. MR denied.

Issue: Where is the proper venue of the present action
for revival of judgment?

Held: Muntinlupa RTC
Section 6, Rule 39 of the 1997 Rules of Civil
Procedure provides that after the lapse of five (5)
years from entry of judgment and before it is barred
by the statute of limitations, a final and executory
judgment or order may be enforced by action. The
Rule does not specify in which court the action for
revival of judgment should be filed.
The proper venue depends on the
determination of whether the present action for revival
of judgment is a real action or a personal action. If the
action for revival of judgment affects title to or
possession of real property, or interest therein, then it
is a real action that must be filed with the court of the
place where the real property is located. If such action
does not fall under the category of real actions, it is
then a personal action that may be filed with the court
of the place where the plaintiff or defendant resides.
The allegations in the complaint for revival of
judgment determine whether it is a real action or a
personal action. The complaint for revival of judgment
alleges that a final and executory judgment has
ordered Infanta to execute a deed of sale over a parcel
of land in Ayala Alabang Subdivision in favor of Aran
Builders; pay all pertinent taxes in connection with
said sale; register the deed of sale with the Registry of
Deeds and deliver to Ayala Corporation the certificate
of title issued in the name of Aran Builders.
The previous judgment has conclusively
declared Aran Builders right to have the title over the
disputed property conveyed to it. It is undeniable that
Aran Builders has an established interest over the lot
in question; and to protect such right or interest, Aran
Builders brought suit to revive the previous judgment.
The sole reason for the present action to revive is the
enforcement of Aran Buidlers adjudged rights over a
piece of realty. Verily, the action falls under the
category of a real action, for it affects Aran Builders
interest over real property. The present case for
revival of judgment being a real action, the complaint
should indeed be filed with the Regional Trial Court of
the place where the realty is located.
Section 18 of BP129 provides that a branch of
the Regional Trial Court shall exercise its authority only
over a particular territory defined by the Supreme
Court. Originally, Muntinlupa City was under the
territorial jurisdiction of the Makati Courts. However,
the Judiciary Reorganization Act of 1981 took effect
and said law provided for the creation of a branch of
the Regional Trial Court in Muntinlupa. Thus, it is now
the Regional Trial Court in Muntinlupa City which has
territorial jurisdiction or authority to validly issue
orders and processes concerning real property within
Muntinlupa City.


JOSEF v. SANTOS

FACTS:
- Petitioner Albino Josef bought shoe materials on
credit from respondent Otelio Santos.
- Josef failed to pay so Santos filed a case for
collection of sum of money.
- Marikina RTC found Josef liable. Josef appealed but
CA affirmed RTC. Josef went to SC via certiorari
but it was dismissed. The Judgment became final
and executory.
- Santos moved for issuance of a writ of execution,
which was opposed by Josef. Still, the writ was
granted and subsequently issued and enforced.
- Certain personal properties subject of the writ of
execution were auctioned off. Thereafter, a real
property located at Marikina City was sold by way
of public auction to fully satisfy the judgment
credit. Santos emerged as the winning bidder and
a Certificate of Sale was issued in his favor.
- Josef filed an original petition for certiorari with the
CA, questioning the sheriffs levy and sale of the
personal and real properties. Josef claimed that the
personal properties did not belong to him but to
his children; and that the real property covered
was his family home thus exempt from execution.
- CA dismissed the petition for failure to file a
motion for reconsideration of the trial courts order
granting the motion for execution and ordering the
issuance of a writ therefor, as well as for his failure
to indicate in his petition the timeliness of its filing
as required under the Rules of Court. MR was also
denied. Hence, this petition.

ISSUE: W/N the writ of execution was valid.

HELD/RATIO: NO.
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As early as during proceedings prior to the
issuance of the writ of execution, Josef brought the
issue of exemption from execution of his home, which
he claimed to be a family home in contemplation of the
civil law. However, instead of inquiring into the nature
of petitioners allegations in his opposition, the trial
court ignored the same and granted Santoss motion
for execution.
The order did not resolve nor take into account
petitioners allegations in his Opposition, which are
material and relevant in the resolution of the motion
for issuance of a writ of execution. This is serious error
on the part of the trial court. It should have made an
earnest determination of the truth to petitioners claim
that the house and lot in which he and his children
resided was their duly constituted family home. Since
it did not, its Order is thus null and void.
The same is true with respect to personal
properties levied upon and sold at auction. Despite
petitioners allegations in his Opposition, the trial court
did not make an effort to determine the nature of the
same, whether the items were exempt from execution
or not, or whether they belonged to petitioner or to
someone else.
Respondent moved for issuance of a writ of
execution on February 17, 2003 while petitioner filed
his opposition on June 23, 2003. The trial court
granted the motion on July 16, 2003, and the writ of
execution was issued on August 20, 2003. Clearly, the
trial court had enough time to conduct the crucial
inquiry that would have spared petitioner the trouble
of having to seek relief all the way to this Court.
Indeed, the trial courts inaction on petitioners plea
resulted in serious injustice to the latter, not to
mention that its failure to conduct an inquiry based on
the latters claim bordered on gross ignorance of the
law.
Being void, the July 16, 2003 Order could not
have conferred any right to respondent. Any writ of
execution based on it is likewise void.
Indeed, petitioners resort to the special civil
action of certiorari in the Court of Appeals was belated
and without benefit of the requisite motion for
reconsideration, however, considering the gravity of
the issue, involving as it does matters that strike at
the very heart of that basic social institution which the
State has a constitutional and moral duty to preserve
and protect, as well as petitioners constitutional right
to abode, all procedural infirmities occasioned upon
this case must take a back seat to the substantive
questions which deserve to be answered in full.
The SC directed the RTC to conduct the
necessary inquiries about the properties subject of
attachment.


D ARMOURED SECURITY AND INVESTIGATION
AGENCY, INC., vs. ARNULFO ORPIA, et. al.

Facts: Orpia et. al, who were employed as security
guards by DArmoured Security and Investigation
Agency, Inc. (D Armoured) and assigned to Fortune
Tobacco, Inc. (Fortune Tobacco), filed with the Labor
Arbiter a complaint for illegal dismissal and various
monetary claims against D Armoured and Fortune
Tobacco.
The Labor Arbiter rendered a Decision in favor
of Orpia et. al. Only Fortune Tobacco interposed an
appeal to the NLRC. D Armoured did not appeal. The
NLRC affirmed with modification the Arbiters decision
and dismissed the complaint against Fortune Tobacco.
This decision became final and executory. As such, the
award specified in the Arbiters decision became the
sole liability of D Armoured.
Upon Orpia et. als motion, the Arbiter issued a
writ of execution. Eventually, the sheriff served a writ
of garnishment upon the Chief Accountant of Foremost
Farms, Inc., a corporation with whom D Armoured has
an existing services agreement. D Armoured filed
with the NLRC a Motion to Quash/Recall Writ of
Execution and Garnishment which was opposed by
Orpia et. al.
The Arbiter denied the motion and directed the
sheriff to release the garnished sum of money to Orpia
et. al pro rata. When D Armoureds MR was denied, it
interposed an appeal to the NLRC. The NLRC dismissed
the appeal for failing to post a bond within the
reglementary period. MR denied. D Armoured filed
with the CA a petition for certiorari and prohibition. CA
dismissed the petition, hence, this petition for review
on certiorari.

Issue: Whether or not D Armoureds monthly
receivables from the Foremost Farms, Inc. (garnishee)
are exempt from execution.

Held and Ratio: D Armoureds monthly receivables
may be garnished. An order of execution of a final
and executory judgment, as in this case, is not
appealable, otherwise, there would be no end to
litigation. On this ground alone, the instant petition is
dismissible.
Assuming that an appeal is proper, Section 1,
Rule IV of the NLRC Manual on Execution of Judgment
provides enumerates what properties are exempt from
execution.
4
It is apparent that the exemption pertains

4
Rule IV
EXECUTION
SECTION 1. Properties exempt from execution. Only
the properties of the losing party shall be the subject of
execution, except:
(a) The losing partys family home constituted in
accordance with the Civil Code or Family Code or as may be
provided for by law or in the absence thereof, the homestead
in which he resides, and land necessarily used in connection
therewith, subject to the limits fixed by law;
(b) His necessary clothing, and that of his family;
(c) Household furniture and utensils necessary for
housekeeping, and used for that purpose by the losing party
such as he may select, of a value not exceeding the amount
fixed by law;
(d) Provisions for individual or family use sufficient for
three (3) months;
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only to natural persons and not to juridical entities.
On this point, the CA correctly ruled that DArmoured,
being a corporate entity, does not fall within the
exemption provided for under Section 13 of Rule 39 of
the Rules of Court:
SECTION 13. Property exempt from
execution. Except as otherwise expressly
provided by law, the following property, and
no other, shall be exempt from execution:
x x x x x x
x x x

(i) So much of the salaries, wages or
earnings of the judgment obligor for
his personal services within the four
months preceding the levy as are necessary
for the support of his family.
The exemption under this procedural rule
should be read in conjunction with Art. 1708 of the
Civil Code, the substantive law which proscribes the
execution of employees wages: Art. 1708. The
laborers wage shall not be subject to execution or
attachment, except for debts incurred for food, shelter,
clothing and medical attendance.
Thus, the exemption under Rule 39 of the
Rules of Court and Article 1708 of the New Civil Code
is meant to favor only laboring men or women whose
works are manual. Persons belonging to this class
usually look to the reward of a days labor for
immediate or present support, and such persons are
more in need of the exemption than any other [Gaa vs.
Court of Appeals, 140 SCRA 304 (1985)].
In this context, exemptions under this rule are
confined only to natural persons and not to
juridical entities such as D Armoured. Thus, the
rule speaks of salaries, wages and earning from the
personal services rendered by the judgment obligor.
The rule further requires that such earnings be
intended for the support of the judgment debtors
family. Necessarily, D Armoured which is a corporate
entity, does not fall under the exemption. If at all, the
exemption refers to D Armoureds individual
employees and not to D Armoured as a corporation.


CAJA V. SHERIFF NANQUIL


(e) The professional libraries of attorneys, judges,
physicians, pharmacists, dentists, engineers, surveyors,
clergymen, teachers, and other professionals, not exceeding
the amount fixed by law;
(f) So much of the earnings of the losing party for his
personal services within the month preceding the levy as are
necessary for the support of his family;
(g) All monies, benefits, privileges, or annuities accruing
or in any manner growing out of any life insurance;
(h) Tools and instruments necessarily used by him in his
trade or employment of a value not exceeding three thousand
(P3,000.00) pesos;
(i) Other properties especially exempted by law.

Facts: Florentino A. Caja was a defendant in a
Complaint for Sum of money named "Triangle Ace
Corporation, Rep. by its General Manager, Mr. David J.
Sagun vs. Subic Realty Corporation, Florentino Caja
and Erickson Y. Caja." Judge Ubiadas decided in favour
of Triangle Corp and ordered the defendants to pay
jointly and solidarily the amount of P956,285.00 with
interest at the rate of 18% per annum, plus 10% as
atty.s fees plus costs. A Writ of Execution, addressed
to Sheriff Nanquil, was issued.
On February 27, 1997, Nanquil sent a Notice of
Garnishment to the Manager of PAG-IBIG instructing it
not to deliver, transfer or dispose defendants money,
credits, shares, interests and deposits therein except
upon orders from the court.
On May 19, 1997, per Sheriffs Return, the
Writ of Execution was returned unsatisfied. Hence, an
Alias Writ of Execution was subsequently issued on
May 19, 1997.
Per Notice of Levy dated May 19, 1997, Sheriff Nanquil
levied a parcel of land declared in the name of Subic
Realty Corporation with a total assessed value of
P1,786,870.00.
On July 1, 1997, Sheriff Nanquil levied two
personal properties of the defendants: one payloader
and one dump truck. On the same day, he issued an
Additional Notice of Levy for 77 pieces of G.I. Sheets.
On January 18, 2000, Realty Corporation,
Florentino Caja and Erickson Y. Caja filed a Motion to
Lift Levy on Execution praying that the levy on their
real property be lifted on the ground that the levy on
their personal properties is sufficient to satisfy the
judgment. They likewise asked the lower court to
direct the sheriff to conduct the appropriate execution
sale.
Judge Ubiadas denied the Motion to Lift Levy
arguing that it cannot be determined at that time if the
amount levied is way above the amount necessary to
satisfy the judgment creditor. He further ordered
Sheriff Nanquil to immediately schedule the auction
sale of defendants real and personal properties that
were levied in accordance with the writ of execution.
On April 26, 2001,Caja filed with the Office of
the Acting Court Administrator this complaint for Grave
Misconduct and Gross Ignorance of the Rules on
Execution under the Rules of Court against Sheriff
Nanquil.
He alleged that Nanquil made an over levy
because Nanquil issued a Notice of Levy of the real
property owned by Subic Realty Corporation with an
assessed value of PhP1,786,870.00 and that he also
issued a Notice of Levy on the personal properties of
the defendant Subic Realty Corporation with assessed
value fixed at PhP2,900,000.00.
He also alleged that instead of delivering the
levied properties to the court for execution sale,
Nanquil delivered them directly to the judgment
creditor (Triangle Ace Corporation) without conducting
the auction sale as provided in Rule 39, Section 19 of
the Rules of Civil Procedure.
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He also said Nanquil violated Rule 9 Sec. 39
because Nanquil did not levy the personal properties
first.
On May 23, 2001, Sheriff Nanquil issued a
Notice of Sheriffs Sale announcing that on June 14,
2001, the payloader, dumptruck and G.I. sheets would
be sold at public auction. Ubiadas then forwarded to
Nanquils comment in which he said, among other
things, that he levied the aforesaid real property
instead of the personal properties for the reason that
undersigned Sheriff could not find any attachable
personal properties of the defendants enough to satisfy
the judgment debt despite diligent efforts exerted;
that only after did he find out of the other personal
properties, that he kept the said equipment in a vacant
lot owned by Triangle considering that there is no
available place in the Hall of Justice of Olongapo City
neither in any other place in Olongapo City that would
not be exposed to elements; and that the real property
was not included in the auction sale as the same is
mortgaged with a certain bank in Bulacan according to
the Register of Deeds of Zambales in the amount of
P10,000,000.00.
The matter was referred to the Executive
Judge of Olongapo City for investigation, report and
recommendation. Since Nanquil was assigned to the
Executive Judge, the matter was referred to Judge
Lazo. Caja and Nanquil filed their position papers, and
then they, along with certain witnesses testified. They
then filed their respective memoranda.
Judge Lazo recommended that the
administrative complaint against respondent sheriff be
dismissed for lack of merit. The report was referred to
the Office of the Court Administrator. In his
memorandum to Associate Justice Reynato S. Puno,
the Court Administrator recommended the dismissal of
the administrative complaint against respondent
sheriff.

Issue: Whether Sheriff Nanquil was guilty of gross
misconduct in the execution of the judgment.

Held: Yes he was.
Ratio: At the outset, it must be determined whether or
not the 1997 Rules of Civil Procedure which took effect
on July 1, 1997

applies to the case at bar. It is
apparent that Nanquil, after Judge Eliodoro G. Ubiadas
rendered his decision on November 19, 1996, issued a
Notice of Garnishment dated February 27, 1997 and a
Notice of Levy on real property dated May 19, 1997.
Thereafter, on July 1, 1997, he issued a Notice of Levy
and an Additional Notice of Levy on personal
properties.
Inasmuch as respondent sheriff started levying
the properties of complainant before the effectivity of
the 1997 Rules of Civil Procedure, and considering
further that the provision he is invoking was inexistent
then, it is only proper to apply the rules prevailing
when he began levying complainants properties. To do
otherwise would create unfairness and cause inequity
in the application of the rules.
Section 8 of Rule 39 (old rules) reads:
Sec. 8. ....(a) If the execution be against the
property of the judgment debtor, to satisfy the
judgment, with interest, out of the personal
property of such debtor, and if sufficient
personal property cannot be found, then out of
his real property; x x x.
It is clear in Section 8(a) of Rule 39 that
satisfaction of the judgment must be carried out first
through the personal property of the judgment debtor,
and then through his real property.
After the decision of the lower court became
final and a writ of execution was issued, the first thing
respondent sheriff did was to serve a Notice of
Garnishment to the Manager of PAG-IBIG, advising the
latter not to deliver, transfer or dispose of money
credits, shares, interests, and deposits in his control
and possession belonging to Subic Realty Corporation,
Florentino Caja and Erickson Y. Caja. Subsequently, an
alias writ of execution was issued and pursuant
thereto, he levied the real property of complainant on
May 19, 1997 and then the latters personal properties
on July 1, 1997.
Clearly, what respondent sheriff levied first
was personal property via garnishment. Garnishment
is considered as a specie of attachment for reaching
credits belonging to the judgment debtor and owing to
him from a stranger to the litigation. It involves
money, stocks, credits, and other incorporeal property
which belong to the party but is in the possession or
under the control of a third person. Since the
properties involved in garnishment are personal
properties, garnishment is thus a levy on personal
property.
We, however, find that respondent sheriff still
violated the rule that satisfaction of the judgment must
be carried out first through the personal property of
the judgment debtor, and then through his real
property. After levying the real property of
complainant, respondent sheriff then levied
complainants personal properties which is a direct
violation of Section 8, Rule 39 and of the writ and alias
writ of execution issued by the court.
Nanquil was negligent when he immediately
levied the real property of complainant without
checking if the latter has other personal properties that
could satisfy the judgment. He could have easily asked
the Land Transportation Office if complainant had
vehicles registered in his name. If he had done so,
respondent sheriff could have known that complainant
had vehicles which he could levy first before levying
any real property. He should have exhausted all means
before going after the real property. This, he did not
do. It was only after levying complainants real
property and after discovering that said property was
encumbered did he look for other personal property.
Second, the claim that the judgment creditor
desisted from proceeding with the levy on the real
property is no excuse. The levy on complainants real
property was already effected and annotated as shown
by Entry No. 122714 in TCT No. T-46478. It was the
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sale of the real property in an execution sale which the
judgment creditor did not insist on because the same
was already mortgaged for P10,000,000.00 in favor of
Town Savings and Loan Bank of Bulacan. It was the
sale of the levied real property in an execution sale
which did not push through.
Levy is different from an execution sale. Levy
has been defined as the act or acts by which an officer
sets apart or appropriates a part or the whole of a
judgment debtors property for the purpose of
satisfying the command of the writ of execution. On
the other hand, an execution sale is a sale by a sheriff
or other ministerial officer under the authority of a writ
of execution which he has levied on property of the
debtor. In the case before us, there was a levy on real
property but the levied property was not sold in an
execution sale because said property, if sold, will not
satisfy the judgment debt because of an existing
encumbrance thereon.
There being a levy on the complainants real property,
the amount thereof must be considered in determining
if there was an overlevy. As gathered from the Tax
Declaration of the real property involved, including its
improvements, its assessed value amounted to
P1,786,870.00. It must be remembered, however, that
said property is mortgaged for P10,000,000.00 in favor
of Town Savings and Loan Bank of Bulacan. The fact
that the property is mortgaged for ten million pesos
only means that its value is more than said amount.
This Court takes judicial notice of the fact that the
value of a property is usually bigger than the amount
for which it can be mortgaged. No person, in the
ordinary course of business, would give a loan which is
bigger than the value of the property that is used to
secure such debt. Certainly, the issue of what is bigger
-- the amount of the loan or the amount of the security
for its payment -- is within public knowledge and
capable of unquestionable demonstration.
The amount of the real property levied upon is
definitely more than ten million pesos since the
property was mortgaged for ten million. This amount
alone is more or less ten times greater than the
judgment debt. As it is, there is already a clear case of
overlevy. Although the levied realty was not auctioned
at an execution sale, its value should still be taken into
account in computing the total amount levied by
respondent sheriff.
Respondent sheriffs answer that he cannot
remember if he did leave a copy of the Notice of Levy
with the judgment debtor only shows that he was not
performing his duty as sheriff. As sheriff, it was his
duty to give the notice of levy or receipt to the person
to whom the personal properties were taken. If no one
would like to receive the same, it was his duty to leave
copies of the notice at the place where he levied the
personal property. Thereafter, he should have reported
the proceedings by filing a report or return to the
court. In the case at bar, even assuming that no one
was willing to accept the notice of levy, the record is
bereft of any evidence showing that respondent sheriff
reported his failure to leave a copy of the notice of
levy. Sheriffs are officers of the court who serve and
execute writs addressed to them by the court, and who
prepare and submit returns of their proceedings. Here,
Nanquil was remiss in his duty as a sheriff.
Respondent sheriffs argument that he kept the levied
personal properties at the judgment creditors place
because the Regional Trial Court of Olongapo City does
not have any warehouse or place to keep the same
does not hold water. A levying officer must keep the
levied properties securely in his custody. The levied
property must be in the substantial presence and
possession of the levying officer who cannot act as
special deputy of any party litigant. They should not
have been delivered to any of the parties or their
representative. The courts lack of storage facility to
house the attached properties is no
justification. Respondent sheriff could have deposited
the same in a bonded warehouse or could have sought
prior authorization from the court that issued the writ
of execution.
In the case at bench, respondent sheriff
brought the personal properties he levied directly to
the vacant lot of Triangle Ace Corporation, , in violation
of the rule requiring him to safely keep them in his
capacity, after issuing the corresponding receipt
therefor. There is nothing in the record that shows that
prior to his delivery of the levied properties to Triangle
Ace Corporation, he sought permission of the court
that issued the writ he enforced to keep the properties.
The last irregularity complainant claims that
respondent sheriff committed was it took the latter
almost four years from the time he levied the personal
properties on July 1, 1997 to schedule the auction sale
thereof, causing the chattels to deteriorate greatly in
value. Nanquil said that the sale was authorized by the
court through its order dated March 8, 2001. On this
note, the SC sided with Nanquil, saying the sheriff is
not liable for the delay as a lot of procedural matters
intervened.
Sheriffs play an important role in the
administration of justice and they should always hold
inviolate and invigorate the tenet that a public office is
a public trust. Being in the grassroots of our judicial
machinery, sheriffs and deputy sheriffs are in close
contact with the litigants; hence, their conduct should
all the more maintain the prestige and the integrity of
the court. By the very nature of their functions,
sheriffs must conduct themselves with propriety and
decorum, so as to be above suspicion. Sheriffs cannot
afford to err in serving court writs and processes and
in implementing court orders lest they undermine the
integrity of their office and the efficient administration
of justice.
It is undisputable that the most difficult phase
of any proceeding is the execution of judgment. The
officer charged with this delicate task is the sheriff.
Despite being exposed to hazards that come with the
implementation of the judgment, the sheriff must
perform his duties by the book. Respondent Nanquil
failed to perform what was expected of him. As above
discussed, his negligence in the discharge of his duties
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and his failure to strictly comply with the provisions of
the Rules of Court have left a stain not only on himself
but more importantly in the office he holds which may
lead to the erosion of the peoples faith and confidence
in the judicial system.


ZAMORA VS. VILLANUEVA

FACTS: Atty. Stanley Zamora is the counsel for
plaintiff in a civil case entitled Sps. Mario and
Carmelita Cruel vs. Sps. Ernesto and Lulu Pe Lim.
Zamora narrates that on June 22, 2008, the RTC
granted plaintiffs motion for the issuance of a writ of
execution. Consequently, he informed the Deputy
Sheriff, Ramon Villanueva, that the defendant has real
property in Nasugbu, Batangas and requested him to
prepare the Notice of Levy on the property. Villanueva
in turn demanded from Zamora 10,000 pesos allegedly
to defray the expenses for the execution proceedings.
Zamora agreed and paid 5,000 pesos as advance
payment, the balance to be paid upon the transfer of
the property in the name of his client.
Villanueva proceeded to Nasugbu, Batangas to
annotate the notice of levy on the propertys title. After
the notice had been annotated on the title, he refused
to proceed with the execution sale unless and until he
was paid the balance of 5,000 pesos.
Zamora acceded to Villanuevas request and
paid him the balance of 5,000 pesos. However, before
the date of the execution sale, Villanueva demanded
an additional 5% of the bid price before proceeding
with the sale. This time, Zamora refused to heed his
demand. Hence, Villanueva refused to proceed with the
sale and further refused to accept the bid of Zamoras
client.
Zamora filed a letter-complaint against
Villanueva before RTC Quezon City charging him with
Gross Misconduct. The Office of the Court
Administrator recommended that Villanueva be
adjudged guilty of Grave Misconduct and be meted the
penalty of suspension for 3 months without pay.

ISSUE#1:
WON Villanueva observed Section 9, Rule 141 of the
Rules of Court relative to the expenses of the
execution sale??? NO.

RULING:
Sec. 9, Rule 141 of the Rules of Court requires the
sheriff to secure the courts prior approval of the
estimated expenses and fees needed to implement the
writ. Specifically, the Rules provide:
SEC. 9. Sheriffs and other persons serving
processes. x x x
(l) For money collected by him by order, execution,
attachment, or any other process, judicial or
extrajudicial, the following sums, to wit;
1. On the first four thousand (P4,000.00)
pesos, four (4%) per centum.
2. On all sums in excess of four thousand
(P4,000.00) pesos, two (2%) per centum.
In addition to the fees hereinabove fixed, the party
requesting the process of any court, preliminary,
incidental, or final, shall pay the sheriffs expenses in
serving or executing the process, or safeguarding the
property levied upon, attached or seized, including
kilometrage for each kilometer of travel, guards fees,
warehousing and similar charges, in an amount
estimated by the sheriff, subject to the approval of the
court. Upon approval of said estimated expenses, the
interested party shall deposit such amount with the
clerk of court and ex officio sheriff, who shall disburse
the same to the deputy sheriff assigned to effect the
process, subject to liquidation within the same period
for rendering a return on the process. Any unspent
amount shall be refunded to the party making the
deposit. A full report shall be submitted by the deputy
sheriff assigned with his return, and the sheriffs
expenses shall be taxed as costs against the judgment
debtor.
Thus, a sheriff is guilty of violating the Rules if
he fails to observe the following: (1) prepare an
estimate of expenses to be incurred in executing the
writ, for which he must seek the court's approval; (2)
render an accounting; and (3) issue an official receipt
for the total amount he received from the judgment
debtor. The rule requires the sheriff executing writs or
processes to estimate the expenses to be incurred.
Upon the approval of the estimated expenses, the
interested party has to deposit the amount with the
Clerk of Court and ex-officio Sheriff. The expenses
shall then be disbursed to the executing Sheriff subject
to his liquidation within the same period for rendering
a return on the process or writ. Any unspent amount
shall be refunded to the party who made the deposit.
In the present case, there was no evidence
showing that Villanueva submitted to the court, for its
approval, the estimated expenses for the execution of
the writ before he demanded 10,000 pesos from
Zamora. Neither was it shown that he rendered an
accounting and liquidated the said amount to the
court. Any act deviating from these procedures laid
down by the Rules is misconduct that warrants
disciplinary action.
As regards Villanuevas refusal to proceed with
the execution sale, allegedly due to the parties refusal
to pay the sales commission, nowhere in the Rules can
it be inferred that payment of any such commission is
a pre-requisite to an execution sale. Villanuevas
refusal to conduct the execution sale was baseless and
illegal.

ISSUE#2: (RELEVANT)
WON Villanueva prematurely adjourned the execution
sale contrary to Section 22, Rule 39 of the Rules of
Court??? YES.

RULING:
Section 22, Rule 39 of the Rules of Court clearly shows
that a sheriff has no blanket authority to adjourn the
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sale. It is only upon written consent of the judgment
obligor and obligee, or their duly authorized
representatives, that the sheriff may adjourn the sale
to a date and time agreed upon. The sheriff may
adjourn it from day to day when there is no such
agreement but only if it becomes necessary to do so
for lack of time to complete the sale on the day fixed
in the notice or the day to which it was adjourned.
Consequently, Villanuevas act of unilaterally
adjourning the execution sale is irregular and contrary
to the Rules.


SPS. MAXIMO LANDRITO, JR. and PACITA
EDGALANI, vs. CA; SPS. BENJAMIN SAN DIEGO
and CARMENCITA SAN DIEGO

FACTS. In July 1990, Sps. Landrito and Egalanai
obtained a loan of P350,000.00 from respondent
Carmencita San Diego. To secure payment thereof,
petitioners executed on 02 August 1990 in favor of the
same respondent a deed of real estate mortgage over
a parcel of land. After making substantial payments,
petitioners again obtained and were granted by
Carmencita San Diego an additional loan of 1M Pesos.
To secure this additional loan, the parties executed on
13 September 1991 an Amendment of Real Estate
Mortgage, whereunder they stipulated that the loan
shall be paid within six (6) months from 16 September
1991, and if not paid within said period, the mortgagee
shall have the right to declare the mortgage due and
may immediately foreclose the same judicially or
extrajudicially.
Spouses defaulted. Therefore, Carmencita San
Diego sent them on 27 April 1993, a final notice of
demand to settle their financial obligation which
already amounted to P1,950,000.00. On 30 June 1993,
Carmencita San Diego filed a petition for the
extrajudicial foreclosure of the mortgage.
On 06 July 1993, said office sent to the parties
a Notice of Sheriffs Sale, therein announcing that
petitioners mortgaged property will be sold in a public
auction to be conducted on 11 August 1993 at 10 am.
As announced, the public auction sale was held and the
mortgaged property sold to respondent Carmencita
San Diego as the highest bidder for P2,000,000.00. On
29 October 1993, respondent San Diego caused the
registration of the sheriffs certificate of sale with the
Office of the Register of Deeds.
With the petitioners having failed to redeem
their property within the 1-year redemption period
from the date of inscription of the sheriffs certificate of
sale, the San Diegos caused the consolidation of title
over the foreclosed property in their names.
Petitioners filed their complaint for annulment
of the extrajudicial foreclosure and auction sale, with
damages. San Diego, filed a motion to dismiss. RTC
granted respondents motion to dismiss and
accordingly dismissed petitioners complaint, saying
that the latters cause of action, if any, is already
barred by laches on account of their failure or neglect
for an unreasonable length of time to do that which, by
exercising due diligence, could or should have been
done earlier. CA affirmed.

ISSUE. Whether the CA erred in affirming the assailed
dismissal order by declaring petitioner spouses to have
been guilty of laches in failing to redeem during the
legal period of redemption the foreclosed parcel of
land. NO. (note: im still trying to figure out the real
issue relevant to the subject matter.)

RATIO. Sec. 6. In all cases in which an extrajudicial
sale is made under the special power hereinbefore
referred to, the debtor, his successors in interest or
any judicial creditor or judgment creditor of said
debtor, or any person having a lien on the property
subsequent to the mortgage or deed of trust under
which the property is sold, may redeem the same at
any time within the term of one year from and
after the date of the sale; xxx (Emphasis supplied)
In a long line of cases, this Court has
consistently ruled that the one-year redemption period
should be counted not from the date of
foreclosure sale, but from the time the certificate
of sale is registered with the Register of Deeds.
Here, it is not disputed that the sheriffs certificate of
sale was registered on 29 October 1993.
It is clear as day that even the complaint filed
by the petitioners with the trial court on 09 November
1994 was instituted beyond the 1-year redemption
period. In fact, petitioners no less acknowledged that
their complaint for annulment of extrajudicial
foreclosure and auction sale was filed about eleven
(11) days after the redemption period had already
expired on 29 October 1994.
Spouses presently insist that they requested
for and were granted an extension of time within which
to redeem their property, relying on a handwritten
note allegedly written by Mrs. San Diegos husband on
petitioners statement of account, indicating therein
the date 11 November 1994 as the last day to pay
their outstanding account in full. Even assuming, in
gratia argumenti, that they were indeed granted such
an extension, the hard reality, however, is that at no
time at all did petitioners make a valid offer to
redeem coupled with a tender of the redemption price.
In Lazo v. Republic Surety & Insurance Co., Inc, this
Court has made it clear that it is only where, by
voluntary agreement of the parties, consisting of
extensions of the redemption period, followed by
commitment by the debtor to pay the redemption
price at a fixed date, will the concept of legal
redemption be converted into one of conventional
redemption. Here, there is no showing whatsoever
that petitioners agreed to pay the redemption price on
or before 11 November 1994, as allegedly set by Mrs.
San Diegos husband. On the contrary, their act of
filing their complaint on 09 November 1994 to declare
the nullity of the foreclosure sale is indicative of their
refusal to pay the redemption price on the alleged
deadline set by the husband.
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It must be remembered that the period of
redemption is not a prescriptive period but a
condition precedent provided by law to restrict the
right of the person exercising redemption. If the
period is allowed to lapse before the right of
redemption is exercised, then the action to enforce
redemption will not prosper, even if the action is
brought within the ordinary prescriptive period.
Moreover, the period within which to redeem the
property sold at a sheriffs sale is not suspended
by the institution of an action to annul the
foreclosure sale. It is clear, then, that petitioners
have lost any right or interest over the subject
property primarily because of their failure to redeem
the same in the manner and within the period
prescribed by law. Their belated attempts to question
the legality and validity of the foreclosure proceedings
and public auction must accordingly fail.


MARSMONY TRADING INC. VS. CA

Facts: Marmosy Trading, Inc. is a domestic corporation
acting as a distributor of various chemicals from
foreign suppliers. Petitioner Victor Morales is the
President and General Manager of Marmosy Trading,
Inc. Respondent Joselito Hubilla was hired as a
Technical Salesman. Marmosy Trading, Inc. terminated
respondents services. Owing to his termination,
Hubilla filed a case for illegal dismissal, illegal
deduction and diminution of benefits against
petitioners before the Labor Arbiter. The LA ruled that
the termination of the services of the complainant to
be illegal and without just and valid cause and ordered
the reinstatement of Hubilla and to pay backwages.
Marsmony filed an appeal to the NLRC but was
denied. This Resolution of the NLRC became final and
executory. Hubilla then filed a Motion for the issuance
of a writ of execution. Marsmony, for their part, further
filed a petition (no mention of what petition) to the
CA. The CA issued a Resolution dismissing outright the
petition. This resolution likewise became final and
executory and an Entry of Judgment was issued by the
appellate court.
Petitioners elevated the decision of the CA to
the SC by a petition for review. The SC denied the
petition. Entry of Judgment was issued and Hubilla
then resorted to a motion for the issuance of
an alias writ of execution. The Labor Arbiter issued a
writ of execution. An MR with Motion to Recall the Writ
of Execution was filed by Marsmony. They assailed the
computation made by the LA and averred that the
company had stopped its operations and that there is
no position to which respondent can be reinstated or
appointed. Petitioners MR was denied and the Sheriff
was directed to proceed with the execution.
Undeterred, petitioners again filed before the NLRC a
Memorandum of Appeal with Prayer for Injunction.
But this was likewise dismissed by the NLRC for failure
to file a supersedeas bond. Petitioners filed an MR
which was denied for lack of merit. The NLRC likewise
emphasized that no further motions for reconsideration
shall be entertained.
Hubilla then filed an ex-parte motion for the
re-computation of his monetary award and for the
issuance of an alias writ of execution the LA issued
an alias Writ of Execution addressed to the NLRC
Sheriff. Pursuant to the writ of execution, the Sheriff
garnished petitioners account with Equitable-PCI Bank.
Petitioners objected to the garnishment by filing an MR
and to recall the order of release and alias writ of
execution alleging that the account with Equitable-PCI
Bank belongs to both petitioner Marmosy Trading, Inc.
and petitioner Victor Morales; that only petitioner
Marmosy Trading, Inc. was the employer of respondent
whereas petitioner Victor Morales, who was president
of the Marmosy Trading, Inc. Petitioners also objected
to the anotation of the notice of levy on the title of the
real property registered in the name of Victor
Morales. Petitioners MR was denied. Petitioners again
appealed to the NLRC which denied its appeal. From
the above NLRC Resolution, petitioners again elevated
the case to the CA via a Petition for Certiorari under
Rule 65. The petition was denied. MR denied as well.

Issue: WON the decision of the CA allowing the notice
of levy to be anotated on the title of real property
registered in the name of Victor Morales (President of
Marsmony) was proper YES!

At the outset, the Court takes notice of the fact that
petitioners already exhausted all the remedies
available to them since the time the LA rendered his
decision. In fact, said decision of the LA was elevated
all the way up to the SC. Execution in favor of the
respondent ought to have taken place as a matter of
right. From the finality, this case was remanded to the
LA for execution. Regrettably, due to the series of
pleadings, motions and appeals to the NLRC, including
petitions to the CA, filed by the petitioners, they have
so far successfully delayed the execution of the final
and executory decision in this case. Until the present,
the decision has not yet been executed. The LAs
decision has long become final and executory and it
can no longer be reversed or modified. Once a
judgment becomes final and executory, the prevailing
party should not be denied the fruits of his victory by
some subterfuge devised by the losing party. Final
and executory judgments can neither be amended nor
altered except for correction of clerical errors, even if
the purpose is to correct erroneous conclusions of fact
or of law.
It is no longer legally feasible to modify the
final ruling in this case through the expediency of a
petition questioning the order of execution. This late
in the day, petitioner Victor Morales is barred, by the
fact of a final judgment, from advancing the argument
that his real property cannot be made liable for the
monetary award in favor of respondent. For a reason
greater than protection from personal liability,
petitioner Victor Morales, as president of his
corporation, cannot rely on our previous ruling that to
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hold a director personally liable for debts of a
corporation and thus pierce the veil of corporate
fiction, the bad faith or wrongdoing of the director
must be established clearly and convincingly.
Judgments of courts should attain finality at some
point lest there be no end in litigation. The final
judgment in this case may no longer be reviewed, or in
any way modified directly or indirectly, by a higher
court, not even by the Supreme Court. The reason for
this is that, a litigation must end and terminate
sometime and somewhere, and it is essential to an
effective and efficient administration of justice that,
once a judgment has become final, the winning party
be not deprived of the fruits of the verdict. Courts
must guard against any scheme calculated to bring
about that result and must frown upon any attempt to
prolong controversies.


BENITEZ VS ACOSTA

Facts: The complainant here is Gloria Benitez in
representation of her mother, Amparo Osla. The
Mother was the defendant in a civil case (Leon Basas
vs Amparo Osilas) filed with the MCTC. It would appear
that judgment was rendered against the Mother for a
sum of money.
Benitez alleges that in implementing the writ of
execution and conducting the execution sale,
respondent Medel Acosta who is the sheriff committed
the following: a) ignored the bid of Gloria Benitez and
Edna Samson; b) sold the jeepney to the highest
bidder, Mario Timbol, who was absent and only sent
his bid through a Joe Castillo who was also absent; c)
sold the jeepney for an unconscionably low price; d)
Mario Timbol and Joe Castillo were merely fronts since
it was Sheriff Acosta who really wanted the jeepney;
e) failed to the deliver the jeepney; f) did not make a
return of the writ of execution; and g) did not comply
with the notice requirements. Sheriff Acosta is then
being charged with grave misconduct, dishonesty and
conduct prejudicial to the best interests of the service.

Issue: Whether there was irregularity in the execution
of the judgment? YES

Held: Sec14, rule39 of the ROC requires the sheriff to:
1) make a return and submit it to the court
immediately upon satisfaction in part or in full of the
judgment; and 2) if the judgment cannot be satisfied
in full, to make a report to the court within 30days
after his receipt of the writ and state why full
satisfaction could not be made. The sheriff shall
continue making a report every 30 days on
proceedings being taken thereon until the judgment is
full satisfied. The reason for this requirement is to
update the court as to the status of the execution and
give it an idea why the judgment has not been
satisfied. It also provides the court an idea as to how
efficient court processes are after the judgment has
been promulgated. The over-all purpose of the
requirement is to ensure the speedy execution of
decisions.
Records show that Sheriff Acosta received the
writ of execution on December 11, 1997. Following
Sec14, Rule 39, Sheriff Acosta was supposed to make
a return to the court 30 days after or by January 10,
1998, and every 30 days thereafter until the judgment
has been satisfied. However, to date, no return has
been made. It is well settled that the sheriffs duty in
the execution of a writ if purely ministerial.
Read Sec9, Rule 39 on Execution of Judgments
for money, how enforced. Under this provision, the
fees collected by the sheriff are required to be paid
over the judgment oblige or the latters authorized
representative. In the absence of both, Sheriff is
obligated to pay them over to the clerk of court who
issued the writ, or if this is not possible, to deposit the
amount in the nearest government depository bank.
In this case, when Mario Timbol paid the bid
price, Sheriff Acosta did not turn over the amount to
Atty. Delfin Gruspe as counsel of Leon Basas or the
clerk of court. Rather, Sheriff Acosta turned it over to
Cesar Gruspe, the brother of Atty. Delfin. The minutes
of the public auction show that Leon Basas (the one
who won against the Mother and in whose favor the
auction sale is being conducted) and Cesar Gruspe
were absent. As such, under the rules, Sheriff Acosta
was under obligation to turn over the money to Atty.
Delfin who is the authorized representative of Leon
Basas.


ST. AVIATION SERVICES V. GRAND
INTERNATIONAL AIRWAYS

FACTS: St. Aviation Services Co., Pte., Ltd. (Petitioner)
is a foreign corporation based in Singapore. It is
engaged in the manufacture, repair, and maintenance
of airplanes and aircrafts. Grand International Airways,
Inc. (Respondent) is a domestic corporation engaged
in airline operations.
In 1996, petitioner and respondent executed
an Agreement for the Maintenance and Modification of
Airbus A 300 B4-103 Aircraft Registration No. RP-
C8882 where petitioner agreed to undertake
maintenance and modification works on respondents
aircraft. (Note: They also agreed that the
construction, validity and performance thereof shall
be governed by the laws of Singapore and further
agreed to submit any suit arising from their agreement
to the non-exclusive jurisdiction of the Singapore
courts.)
Petitioner undertook the contracted works and
billed respondent the total amount of US$303,731.67
or S$452,560.18. But despite petitioners repeated
demands, respondent failed to pay. Petitioner filed with
the High Court of the Republic of Singapore for the
sum S$452,560.18 including interest and costs,
against respondent. Court issued Writ of Summons to
be served extraterritorially or outside Singapore upon
respondent. The court also sought assistance of the
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sheriff of Pasay City. However, despite receipt of
summons, respondent failed to answer the claim.
On motion of petitioner, the Singapore High
Court rendered a judgment by default against
respondent. Petitioner then filed with RTC, Pasay City,
a Petition for Enforcement of Judgment, to which
respondent filed a MTD on 2 grounds: 1) Singapore
High Court did not acquire jurisdiction over its person;
and 2) the foreign judgment sought to be enforced is
void for having been rendered in violation of its right to
due process. RTC denied respondents MTD and MR.
Respondent filed with CA a Petition for
Certiorari to set aside RTC decision, which was granted
without prejudice to the right to initiate another
proceeding before the proper court to enforce its
claim. Petitioner filed a MR which was denied. Hence,
the instant Petition for Review on Certiorari.

ISSUES:
- Whether the Singapore High Court has acquired
jurisdiction over the person of respondent by the
service of summons upon its office in the
Philippines -YES
- Whether the judgment by default by the Singapore
High Court is enforceable in the Philippines -YES

RULING: (Generally, in the absence of a special
contract, no sovereign is bound to give effect within its
dominion to a judgment rendered by a tribunal of a
foreign country. However, under the rules of comity,
utility and convenience, nations have established a
usage among civilized states by which final judgments
of foreign courts of competent jurisdiction are
reciprocally respected and rendered efficacious under
certain conditions that may vary in different countries.)
Under Rule 39, Sec. 48, a foreign judgment or
order against a person is merely presumptive evidence
of a right as between the parties and may be repelled,
among others, by want of jurisdiction of the issuing
authority or by want of notice to the party against
whom it is enforced. The party attacking a foreign
judgment has the burden of overcoming the
presumption of its validity.
Respondent contends that the service of
summons is void and that the Singapore Court did not
acquire jurisdiction over it.
Generally, matters of remedy and procedure
such as those relating to the service of process upon a
defendant are governed by the lex fori or the internal
law of the forum, which in this case is the law of
Singapore. In this case, the petitioner moved for leave
of court to serve a copy of the Writs of Summons
outside Singapore, which was granted. This service of
summons outside Singapore is in accordance with
Order 11, r. 4(2) of the Rules of Court 1996 of
Singapore: xxx c) by a method of service authorized
by the law of that country for service of any originating
process issued by that country.
In the Philippines, jurisdiction over a party is
acquired by service of summons by the sheriff, his
deputy or other proper court officer either personally
or by substituted service. In this case, the Writ of
Summons was served upon respondent at its office.
The sheriffs return shows that it was received by the
Secretary of the General Manager of respondent
company. But respondent completely ignored the
summons.
Considering that the Writ of Summons was
served upon respondent in accordance with our Rules,
jurisdiction was acquired by the Singapore High Court
over its person. Clearly, the judgment by default is
valid.


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FERNANDO V. SANTAMARIA

FACTS: Fernando filed a complaint against Uy, Chua,
and Borres. She alleged that she obtained 3 loans
from Chua (P5.5M) where she issued a REM over a lot.
Before the 3
rd
loan was released, she was asked by
Borres (agent of Chua) to sign a Deed of Sale
conveying the lot to Chua for P3M but said that the
deed was merely a formality.
Later, Fernando learned that a new TCT was
issued in the name of Chua. Chua offered to sell back
the property to Fernando for P10M and she agreed but
she came to know that the same lot was sold to Uy for
P7M.
Fernando sought to annul the deeds of sale
and the recovery from Borres P200K which she
allegedly gave as payment of the real property taxes of
the lot as well as the amount of P120,000.00 which
Borres unlawfully deducted from her third loan.
Chua filed a motion to dismiss on the ground
of prescription, and that her cause of action has been
waived or abandoned. The lower court dismissed the
complaint on the grounds of prescription, ratification
and abandonment of cause of action. It held that
Fernando ratified Chuas act of selling the lot to Uy by
acknowledging that the latter is now the owner of the
lot in her letter offering to repurchase the same and to
pay the incidental expenses of the sale. But later on,
the lower court modified its order by reinstating the
complaint insofar as the action for the recovery of sum
of money against Borres is concerned.
Fernando filed a notice of appeal. Chua filed a
motion to dismiss for failure to file a record on appeal
within the required period. The trial court granted the
motion to dismiss.
Certiorari with CA: trial court affirmed - the
trial court validly rendered several judgments because
the liability of Borres in Fernandos third cause of
action is distinct from the liability of the other
respondents. To perfect an appeal, the CA ruled that
Fernando must file a record on appeal in addition to
the notice of appeal within 30 days from notice of the
assailed order pursuant to Section 2(a) and 3, Rule 41.

Issue: w/n she was able to perfect her appeal NO

SC: Fernandos cause of action against Borres for
collection of sum of money is clearly severable from
her action against the other respondents. Thus,
rendition of several judgments is proper. Under Sec.
2(a) of Rule 41, no record of appeal shall be required
except in specil proceedings and other cases of
multiple or separate appeals where the law or these
Rules so require.
The rationale for requiring the filing of a record
on appeal in cases where several judgment is rendered
is to enable the appellate court to decide the appeal
without the original record which should remain with
the court a quo pending disposal of the case with
respect to the other defendants.
Under Section 2(a) in relation to Section 3, of
Rule 41, Fernando is required to file a record on appeal
within 30 days from her date of receipt of the trial
court order. Considering that no record on appeal was
filed, the CA correctly sustained the order of the trial
court dismissing her appeal for failure to perfect the
same within the reglementary period. A fundamental
precept is that the reglementary periods under the
Rules are to be strictly observed for being considered
indispensable interdictions against needless delays and
an orderly discharge of judicial business. The strict
compliance with such periods has more than once been
held to be imperative, particularly and most
significantly in respect to the perfection of appeals.
Upon expiration of the period without an appeal having
been perfected, the assailed order or decision becomes
final and executory and the court loses all jurisdiction
over the case.
Finally, even if we brush aside the procedural
flaws in the instant case, the appeal is still dismissible
because Fernandos conduct is inconsistent with her
claim of fraud. Instead of impugning the validity of the
sale of the lot to Chua, she accepted the latters offer
to resell the property in the amount of P10M. After
learning that Chua sold the same lot to Uy, she again
offered the buy the lot for P13M and to shoulder the
payment of all incidental expenses, thus, confirming
that Uy has a valid title over the property. What is
more, she filed a criminal complaint for estafa against
respondents only on October 6, 1998, or almost 3
years from the time she learned of the alleged
fraudulent transfers of her property.


MADRIGAL TRANSPORT V. LAPANDAY HOLDINGS,
MACONDRAY AND CO., LUIS LORENZO, JR.
Sorry, everything was important

FACTS: Madrigal Transport filed a petition for
Voluntary Insolvency at RTC Manila Br. 49. Later, it
filed a complaint for damages against herein
respondents at RTC Manila Br. 36. In the latter action,
Madrigal Transport alleged that it entered into a joint
venture agreement with Lapanday for operating
vessels for the shipping needs of Del Monte Phils. and
it did so on the strength of Lorenzos representations
in his capacity as the chairman of the board of Del
Monte, Lapanday and Macondray. The complaint for
damages was caused by Lapanday and Lorenzos
failure to deliver Del Monte charter hire contracts
which was their end of the bargain, and for which
Madrigal Transport obtained a 10M bank loan.
The insolvency court (br. 49) declared Madrigal
Transport insolvent. After this, the respondents filed
motions to dismiss the case pending before br. 36. Br.
36 granted the MTD for failure of the complaint to
state a cause of action, because by Madrigal
Transports filing a Petition for Voluntary Insolvency, it
lost the right to institute the complaint for damages,
pursuant to the insolvency law. RTC br 36 held that
the right to prosecute actions belonged to the court-
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appointed assignee, not Madrigal. Madrigal thus filed
an MR, which was denied.
Then, it filed a Petition for Certiorari with CA.
The CA issued a resolution requiring Madrigal to
explain why its petition should not be dismissed on the
ground that the questioned lower court orders should
have been elevated by ordinary appeal. CA eventually
ruled that since the main issue in the case was purely
legal, it was an exception to the general rule that
certiorari was not proper when appeal was available.
Respondents filed an MR with the CA.
CA ruling: respondents MR granted. Petition
for certiorari filed by Madrigal is dismissed. CA held
that an order granting a motion to dismiss was final,
hence, it is the proper subject of an appeal, not
certiorari (CA was referring to RTCs dismissal of
Madrigals MR).
Madrigal now filed a petition for review under
Rule 45 assailang the CAs ruling. Madrigal claims it
correctly questioned the RTCs Order through Pet. for
Certiorari, respondents claim an ordinary appeal was
the proper remedy.

Issue: whats the proper remedy? Appeal!

Ruling: Under Rule 41, an appeal may be taken from a
judgment or final order that completely disposes of the
case. The manner of appealing an RTC judgment or
final order is: (1) Ordinary appeal (2) Pet. for review;
(3) Appeal by certiorari.
On the other hand, a petition for certiorari is
governed by Rule 65. It may only be issued for the
correction of errors of jurisdiction or GADALEJ. Its
function is limited to keeping the lower court within the
bounds of its jurisdiction. Certioraris requisites are:
(1) the writ is directed against a tribunal, a board or
any officer exercising judicial or quasi-judicial
functions; (2) such tribunal, board or officer has acted
without or in excess of jurisdiction, or with grave
abuse of discretion amounting to lack or excess of
jurisdiction
1
; and (3) there is no appeal or any plain,
speedy and adequate remedy in the ordinary course of
law. Certiorari is not the proper remedy if appeal
is available. Remedies of appeal (including
petitions for review) and certiorari are mutually
exclusive, not alternative or successive.
Certiorari is not and cannot be a substitute for an
appeal, especially if ones own negligence or error in
ones choice of remedy occasioned such loss or lapse.

1
Without jurisdiction means that the court acted with
absolute lack of authority. There is excess of jurisdiction
when the court transcends its power or acts without any
statutory authority. Grave abuse of discretion implies such
capricious and whimsical exercise of judgment as to be
equivalent to lack or excess of jurisdiction; in other words,
power is exercised in an arbitrary or despotic manner by
reason of passion, prejudice, or personal hostility; and such
exercise is so patent or so gross as to amount to an evasion
of a positive duty or to a virtual refusal either to perform the
duty enjoined or to act at all in contemplation of law.

One of the requisites of certiorari is that there be no
available appeal or any plain, speedy and adequate
remedy. Where an appeal is
available, certiorari will not prosper, even if the
ground therefor is grave abuse of discretion.

SC distinguished Appeal and Certiorari:

As to purpose. Certiorari is for the correction of errors
of jurisdiction, appeal for errors of judgment (meaning
error of law/fact).

As to manner of filing. Over an appeal, the CA
exercises its appellate jurisdiction and power of
review. Over a certiorari, the higher court uses its
original jurisdiction in accordance with its power of
control and supervision over the proceedings of lower
courts.

An appeal is thus a continuation of the original
suit, while a petition for certiorari is an original and
independent action that was not part of the trial that
had resulted in the rendition of the judgment or order
complained of. The parties to an appeal are the
original parties to the action; Parties to a petition
for certiorari are the aggrieved party (who thereby
becomes the petitioner) against the lower court or
quasi-judicial agency, and the prevailing parties (the
public and the private respondents, respectively).

As to the Subject Matter. Only judgments or final
orders and those that the Rules of Court so declare are
appealable. An original action for certiorari may be
directed against an interlocutory order of the lower
court prior to an appeal from the judgment or where
there is no appeal or any plain, speedy or adequate
remedy.

As to the Period of Filing. Generally 15 days for appeal
(depends on kind of appeal), a petition
for certiorari should be filed not later than 60 days
from the notice of judgment, order, or resolution.
As to the Need for a Motion for Reconsideration. A
motion for reconsideration is generally required prior
to the filing of a petition for certiorari. Note also that
this motion is a plain and adequate remedy expressly
available under the law. Such motion is not required
before appealing a judgment or final order.

Petitioner was ascribing errors of judgment in
its Petition for Certiorari filed with CA. The issue
raised there was the trial courts alleged error in
dismissing the Complaint for lack of cause of action.
Petitioner argues that it could still institute the
Complaint, even if it had filed a Petition for Insolvency
earlier. As petitioner was challenging the trial courts
interpretation of the law the issue involved an error of
judgment, not of jurisdiction. An error of judgment
committed by a court in the exercise of its legitimate
jurisdiction is not necessarily equivalent to grave
abuse of discretion.
Also, an order of dismissal, whether correct or
not, is a final order. It is not interlocutory, it leaves
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nothing more to be done by the lower court. Therefore
the remedy of the plaintiff is to appeal the order. Citing
Sections 1(a) and 1(h), Rule 41, petitioner further
claims that it was prohibited from filing an appeal.
Section 1(a) of the said Rule prohibits the filing of an
appeal from an order denying an MR, because the
remedy is to appeal the main decision as petitioner
could have done. In fact, under Rule 37, the remedy
against an order denying an MR is to appeal the
judgment or final order. Section 1(h) does not apply,
because the trial courts Order did not dismiss the
action without prejudice.
There are actually instances when SC
granted certiorari despite the availability of appeal.
Where the exigencies of the case are such that appeal
may not be adequate, either in point of promptness or
completeness, so that a failure of justice could result, a
writ of certiorari may still be issued. The present case
does not fall under the exceptions.
Even assuming that the Order of the RTC was
erroneous, its error did not constitute grave abuse of
discretion. It merely was an error of judgment.
Petitioner availed of certiorari because the 15-day
period within which to file an appeal had already
lapsed. Basic is the rule that certiorari is not a
substitute for the lapsed remedy of appeal.


NAPOCOR v. PADERANGA (Sorry medyo lengthy!)

FACTS: Petitioner NPC filed a complaint for
expropriation against respondents Petrona Dilao, et al
to implement its Leyte-Cebu interconnection project. A
day after the filing of the complaint, NPC filed an
urgent ex-parte motion for the issuance of a writ of
possession of the lands. Dilao filed her Answer with
Counterclaim but Enriquez (one of the defendants) did
not.
The RTC of Danao granted the writ and then
appointed a Board of Commissioners to determine just
compensation. The commissioners submitted their
recommended appraisal but NPC filed an opposition to
this assailing its correctness. The trial court rendered a
decision adopting the findings of the commissioners.
NCP filed a notice of appeal but the trial court
denied for having been filed outside of the
reglementary period, it having failed to file a
record on appeal. NPC filed an MR stating that a
record on appeal was not required, contending
that a record on appeal was not required as the
trial court rendered judgment against all the
defendants including Enriquez as shown by the
dispositive portion of the decision referring to
Petrona Dilao et al.
2
The trial court denied NPCs
motion for reconsideration, clarifying that the

2
DIGESTERS NOTE: The petitioner that judgment was
rendered against all defendants because it wants to establish
that there wasnt any possibility of multiple appeals in this
case. Note that in cases where there are multiple or separate
appeals from a judgment, a record on appeal is required.
reference to Petrona Dilao et al. in the dispositive
portion of its decision was meant to cover only Dilao
and her co-owner-siblings.
NPC subsequently filed before the trial court a
petition for relief from the denial of its appeal on the
ground that its failure to file a record on appeal was
due to honest mistake and excusable neglect, it having
believed that a record on appeal was not required in
light of the failure of the other defendant, Enriquez, to
file an answer to the complaint. (akala niya, dahil di
nagfile ng answer, di na maga-appeal.)
The trial court denied NPCs petition for relief
for lack of factual and legal basis. The trial court
granted Dilao et al.s motion for execution of
judgment.
NPC filed a petition for certiorari with the Court
of Appeals with prayer for temporary restraining order
and a writ of preliminary injunction assailing the trial
courts order denying its appeal, as well as the order
granting Dilao et al.s motion for execution. The
appellate court, however, denied NPCs petition,
it holding that under Rule 41, Section 2 of the
ROC, the filing of a record on appeal is required
in special proceedings and other cases of
multiple or separate appeals, as in an action for
expropriation in which the order determining the
right of the plaintiff to expropriate and the
subsequent adjudication on the issue of just
compensation may be the subject of separate
appeals.
Hence, NPC filed this petition. Essentially, NPC
was arguing that there could be no possibility of
multiple appeals arising from this case because 1) a
complaint for expropriation is a Special Civil Action
under Rule 67 of the Rules of Civil Procedure, not a
special proceeding as contemplated under Rule 41,
Section 2 of the Rules of Civil Procedure; 2) that there
is no law or rules specifically requiring that a record on
appeal shall be filed in expropriation cases; and 3) of
the two sets of defendants in the present case, the
Dilaos and Enriquez, the first, while they filed an
answer, did not appeal the trial courts decision, while
with respect to the second, there is no showing that
summons was served upon her, hence, the trial court
did not acquire jurisdiction over her and, therefore, no
appeal could arise whatsoever with respect to the
complaint against her.

ISSUE: W/N a record on appeal was required? YES.

HELD: Rule 41, Section 2 of the 1997 Rules of Civil
Procedure, as amended, clearly provides:
SEC. 2. Modes of Appeals.
(a) Ordinary appeal. The appeal to the Court
of Appeals in cases decided by the Regional
Trial Court in the exercise of its original
jurisdiction shall be taken by filing a notice of
appeal with the court which rendered the
judgment or final order appealed from and
serving a copy thereof upon the adverse
party. No record on appeal shall be required
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except in special proceedings and other cases
of multiple or separate appeals where the law
or these Rules so require. In such cases, the
record on appeal shall be filed and served in
like manner.
While admittedly a complaint for expropriation
is not a special proceeding, the above-quoted rule
requires the filing of a record on appeal in other cases
of multiple or separate appeal. Jurisprudential law, no
doubt, recognizes the existence of multiple appeals in
a complaint for expropriation. First appeal may concern
the propriety of the exercise of the power while the
second may pertain to the sufficiency of the just
compensation.
Respecting NPCs claim that the trial court did
not acquire jurisdiction over the other defendant,
Enriquez, there being no evidence that summons was
served on her and, therefore, no appeal with respect to
the case against her arose, the trial courts Order of
May 9, 1996 belies said claim:
x x x
In the letter-appeal by defendant
Estefania V. Enriquez addressed to the
Court, defendant did manifest no
opposition to the right of plaintiff to the
use of her land but only wich (sic) that
payment be based on the actual market value
of the property sought to be expropriated. In
comment to said letter-appeal, plaintiff
stressed that the amount deposited was purely
to secure a writ of possession as provided
under PD 42. It agreed with defendant that
the fair market value or actual market value
shall be the basis for the just compensation of
the property.
x x x
That the defendant Enriquez did not file an
answer to the complaint did not foreclose the
possibility of an appeal arising therefrom. In other
words, once the compensation for Enriquez property is
placed in issue at the trial, she could, following the
third paragraph of Section 3 of Rule 67
3
, participate
therein and if she is not in conformity with the trial
courts determination of the compensation, she can
appeal therefrom.
Multiple or separate appeals being existent in
the present expropriation case, NPC should have filed a
record on appeal within 30 days from receipt of the
trial courts decision. The trial courts dismissal of its
appeal, which was affirmed by the appellate court, was
thus in order.

3
A defendant waives all defenses and objections not so
alleged but the court, in the interest of justice, may permit
amendments to the answer to be made not later than ten
(10) days from the filing thereof. However, at the trial of the
issue of just compensation, whether or not a defendant
has previously appeared or answered, he may present
evidence as to the amount of the compensation to be paid for
his property, and he may share in the distribution of the
award.
En passant, glossing over NPCs failure to file
record on appeal, its appeal would still not prosper on
substantive grounds. (Pls. Refer to original case for
this part. Di na naman relevant for this particular
provision yung part na to.)


STATE INVESTMENT TRUST INC. V. DELTA
MOTORS

Facts: State Investment Trust Inc. (SITI) filed a
complaint for a sum of money against Delta Motors
Corp. The latter defaulted and was ordered to pay SITI
around 20M. The decision was published in a
newspaper and SITI filed a motion for the issuance of
a writ of execution (Execution 1). This was granted by
the RTC.
Delta received a copy of the ruling and prayed
to the CA that the judgment and order of execution by
the RTC be reversed/annulled on the ground that
summons had been served upon a person not
authorized to receive it. (This shall be referred to as
the FIRST CASE) The CA stated that summons were
properly served but the RTC Judgment had not
attained finality. Note that the CA Decision was silent
on the assailed RTC Order granting the execution.
Delta then appealed to the SC.
Since the judgment had not attained finality,
Delta filed its Notice of Appeal with the RTC, which,
however, dismissed it upon SITIs motion.
As a result, Delta filed a petition for certiorari
in the CA assailing the RTCs order dismissing the
appeal (This shall be referred to as the SECOND
CASE). This was granted and it stated that the RTC
was ordered to ELEVATE the records of the case to the
CA, on appeal.
SITI was not pleased, so it elevated the ruling
in the SECOND case to the SC. While SITIs appeal was
pending, Delta filed an Omnibus Motion with the CA
asking for the annulment of the execution order in the
FIRST case.
The SC denied SITIs appeal in the SECOND
case. Delta moved for the resolution of their Omnibus
Motion but this too was denied by the SC. Delta
appealed the denial to no avail.
SITI filed an Omnibus Motion of Execution
(Execution 2) over certain properties (Around 4 years
later after the first case). Delta challenged this before
the CA.
The CA ruled in favour of Delta stating that
there can be no execution in the FIRST case because
the case was not yet final and executory. The Omnibus
Motion of Execution by SITI was also not valid because
the case was not final and executory.

N.B. Because of this shitty case, the important shit
here is that there was a writ of execution but the CA
said that it was not final and executory. There was an
appeal filed and the 15-day period lapsed. Plaintiff still
filed for execution despite perfection of the appeal and
it was granted. Was it valid? WAS IT?!
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Issue: Was there a valid order of execution?

Decision: No. The RTC had no jurisdiction to issue
such order.
Note that this is an execution pending appeal.
This means that filed a motion must be filed in the trial
court while it has jurisdiction over the case and is in
possession of either the original record or the record
on appeal, as the case may be, at the time of the filing
of such motion, said court may, in its discretion, order
execution of a judgment or final order even before the
expiration of the period to appeal.
So when does the trial court lose jurisdiction
over the case? It loses jurisdiction upon PERFECTION
of an appeal and expiration of time to appeal of the
other parties. This means that arecord on appeal was
filed in due time with the court.
In this case, the appeal filed by Delta was
perfected when it filed its Notice of Appeal.
Considering that it had already filed such Notice, and
that the period of appeal for SITI had already expired,
the RTC no longer had jurisdiction over the case.
Hence, the trial court acted improperly when it issued
its Order granting SITIs Omnibus Motion. That Motion
was filed four years after the SC had affirmed the CA
Decision directing the elevation of the records on
appeal. For having been issued without jurisdiction,
the Order is plainly null and void.
Delta was not guilty of laches either. It was the
duty of the RTC clerk of court to transmit the records
to the appellate court. The CA in fact ordered the RTC
to elevate those records. Consequently, the RTC was
duty-bound to obey this mandate within ten (10) days
from its receipt of the Notice of the entry of final
judgment. The branch clerk of court, not Delta, was
primarily responsible for seeing to it that the records of
appealed cases were properly sent to the appellate
court without delay.


LAND BANK VS. ARLENE DE LEON AND
BERNARDO DE LEON

Facts: The De Leons filed a petition to fix the just
compensation of a parcel of land with the RTC, acting
as a Special Agrarian Court. The agrarian court issued
a summary judgment fixing the compensation of the
land as follows: (1) P1.2M for 16.7 hectares of
riceland; and (2) P2.9M for 30 hectares of sugarland.
The Dept. of Agrarian Reform (DAR) filed a petition for
review, which was assigned to the CAs special 3
rd

division. On the other hand, the Land Bank of the
Philippines (LBP) filed an ordinary appeal, which was
assigned to the CAs 4
th
division.
The petition for review of DAR was given due
course. However, the ordinary appeal filed by the LBP
was dismissed on the ground that it was the wrong
mode of appeal. LBP filed a petition for review with the
SC, which affirmed the CAs ruling.
The SC held that the Comprehensive Agrarian
Reform Law (CARL) is clear that the proper mode of
appeal from the decisions of special agrarian courts is
a petition for review. Sec. 60 of the CARL states that
appeals from Special Agrarian Courts shall be taken by
petition for review with the CA. Sec. 61 of the CARL
states that review by the CA/SC shall be governed by
the ROC. So there is an apparent inconsistency
between these 2 sections.
LBP bases its argument that an ordinary appeal
is proper on Sec. 61. However, as ruled by the SC, the
CARL clearly states in Sec. 60 that the proper mode of
appeal is a petition for review. Hence, Sec. 61 merely
makes a general reference to the ROC and does not
categorically prescribe ordinary appeal as the correct
way of questioning decisions of Special Agrarian
Courts. Thus, the SC interpreted Sec. 61 to mean that
the specific rules for petitions for review in the ROC
and other relevant procedures of appeals shall be
followed in appealed decisions of Special Agrarian
Courts.
The LBP argues that the pertinent provisions in
the CARL violate the rule-making power of the SC,
hence unconstitutional. The SC ruled otherwise holding
that since the pertinent provisions in the CARL are
special procedures and the SC has not yet provided for
a particular process for appeals from decisions of
agrarian courts, the said provisions does not encroach
upon its powers.
So, the LBP this MR.

Issue: What is the proper mode of appeal? Petition for
review!

Held/Ratio:
The Proper Mode of Appeal from Special Agrarian
Courts is a Petition for Review
The SC basically reiterated the ratio in their
previous ruling, as stated in the facts above. The only
thing it added in this MR was that it once and for all
held that the proper mode for appeal from Special
Agrarian Courts is a petition for review. Note that
before this case, there had been several conflicting
decisions by the CA regarding the proper mode of
appeal. For this lack of jurisprudence interpreting
Sections 60 and 61 of the CARL, the SC ruled that LBP
should not be blamed for resorting to the wrong
appeal.
Finally, as a side note, the SC held that this
decision should only apply prospectively in order not to
violate substantive rights. If the ruling is given
retroactive application, it will prejudice LBPs right to
appeal because pending appeals in the CA will be
dismissed outright on mere technicality thereby
sacrificing the substantial merits thereof. It would be
unjust to apply a new doctrine to a pending case
involving a party who already invoked a contrary view
and who acted in good faith thereon prior to the
issuance of said doctrine.


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AGUILAR v COURT OF APPEALS

FACTS:
This is a petition for review on certiorari (Rule 45)
from the decision of the Special 8
th
division of the
CA.
Aguilar was appointed as election officer and
Chairman of the Municipal Board of Canvassers in
Laguna during the 1998 elections.
After partially canvassing the votes, he abandoned
his duty and never returned.
The winners of the election were proclaimed but the
certificates of canvass did not bear Aguilars
signature as he was missing in action.
Thereafter, he was charged with abandonment and
neglect of duty by COMELEC. He was placed under a
6month suspension.
Aguilar moved twice to reconsider the suspension
claiming that his absence was due to illness, physical
exhaustion and threats from violent groups. Both
MRs were denied.
Aguilar then appealed to the CSC and filed his Notice
of Appeal together with his appeal memorandum.
CSC affirmed the finding of COMELEC but modified
the penalty by imposing dismissal.
Aguilar appealed to the CA via Rule 43
CA dismissed the appeal ruling that the CSC decision
had already become final in view of the untimely
submission of Aguilars MR which was filed 9 days
beyond the 15 day period.
Aguilar contends that he should be excused because
his MR was belated only by 1 day.

ISSUE:
Whether or not Aguilar may be excused YES
Whether or not Aguilar should be dismissed - NO

HELD:
Aguilar was late only by 1 day and not 9 days. Even
so, this is excused because the deadline for the filing
of the MR fell on a weekend. This explains why
Aguilar was late by a day. In the interest of justice,
procedural rules must be relaxed. Remember that
cases must be disposed off according to their merits
and not merely on technicality.
The COMELEC ruling of suspension should be
followed and not the CSC ruling of dismissal. This is
because according to CSC rules cases appealed to it
should have underwent only one MR. however, in
this case, Aguilar filed 2 MRs before the COMELEC.
Thus the appeal with the CSC should have been
denied for failure to comply with its rules. That
having been said, the COMELEC ruling had become
final and executory.


ROSALIE VDA DE CARDONA V AMANSEC

Facts: Cardona filed a case of ejectment against
Amansec over a parcel of agricultural land in
Pangasinan. Amansec claimed that the land was
actually owned by a 3
rd
party named Isabel Raroque,
from whom he was leasing the land. The ejectment
case over the land spawned another case filed in the
DARAB. This DARAB case is the relevant case for this,
um, case.
Anyway, Amansec filed in the Provincial
Agrarian Reform Adjudicator (PARAD) claiming that the
deed of sale entered into by Raroque and Cardona was
void and that an emancipation patent be issued to him
(Amansec). The provincial agrarian reform adjudicator
ruled for Amansec, declaring the deed of sale void and
giving him the emancipation patent. Cardona, instead
of filing her appeal with the DARAB, she decided to file
a petition for review with the Court of Appeals.
Cardona asked for an extension to file her
petition for review. She claimed she got the PARAD
decision on August 7 and thus had until August 30 to
file it. However, she asked for a 15 day extension to
file her petition for review. According to her
calculation, she had until September 15 to file it.
Hence, she filed her petition for review on September
15. Interestingly, the CA granted the extension,
following the calculation of Cardona.

Issue: Was the petition for review filed with the CA
filed on time?

Held: No. It wasnt. The last day was supposed to be
on September 14. Cardona was negligent in forgetting
that August lasted until August 31, not merely August
30. So they counted wrong. The Court however ruled
that they usually dont dismiss outright for a one-day
delay. The problem is, Cardona did NOT follow the
appeal process as described by law.
The proper remedy of a decision of the PARAD
was an appeal (within 15 days) to the DARAB and not
a petition for review with the CA, as per the DARAB
New Rules of Procedure. Under the said rules, the
petitioner should have appealed the decision of the
PARAD to the DARAB orally or in writing, and perfected
the said appeal within the requisite period and in the
manner provided therefor. Cardona failed to do so.
The well-entrenched rule is that appeal is merely a
statutory right and must be availed of within the period
and in the manner provided for by law; otherwise,
upon the lapse of the period to appeal from a decision
or final order and no appeal has been perfected by the
aggrieved party, such final order or decision ipso facto
becomes final and executory. The appellate court does
not acquire appellate jurisdiction over a belated appeal
from the said order or decision.


CONEJOS V CA

Facts: Borromeo Bros. Estate, Inc. (Estate) owns a
lot in Cebu, being bought by petitioner Teresita
Conejos. Private respondent Eutiquio Plania then
entered into a Memorandum of Agreement (MOA)
with Conejos whereby they agreed that each of them
would pay half of the purchase price of the 134 sq. m
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lot, and that upon full payment they would equally
divide the lot and register it in their individual names.
Plania averred that after paying P23k (value of his
share) to the Estate, Conejos, despite repeated
demands, refused to divide the subject lot and register
it in their individual names conformably with their
agreement.
Plania referred the matter to the Lupon (Office
of the Barangay Captain of Tisa, Cebu). In the Minutes
of Hearing, it is shown that Plania did shell out P23k as
payment, and that he authorized Conejos to sell his
portion of the property. Conejos admitted having sold
the property to Nenita Gavan without remiting the
proceeds of the sale to Plania. Conejos then promised
to pay the P23k to Plania, but she reneged on her
promise, so Plania instituted a complaint for specific
performance/rescission with damages before the
MTCC.
In her Answer, Conejos alleged that (1)
the MOA was mutually abandoned by the parties, (2)
the stipulations contained in the Minutes of the
Hearing were mere proposals by Plania for an amicable
settlement which she rejected, and (3) she never
admitted the veracity of the contents of the Minutes of
the Hearing. All she admitted was the confrontation
between her and Plania before the Lupon.
MTCC dismissed the complaint, ruling that Plania
had failed to present sufficient evidence to substantiate
his allegations because the official receipts proving
payment were issued in Cornejos name and not
Planias. The court also said that the MOA had been
mutually abandoned by the parties considering that
Plania did not even inform the Estate about the
aforesaid Agreement. Further, MTCC did not give any
probative value to the Minutes of the Hearing, as it
was only signed by the Pangkat Secretary and the
Barangay Chairman but not by Plania and Conejos. The
RTC, however, reversed the MTCC. It ruled that (1) no
evidence was proffered to prove the cancellation of the
MOA, and that a written agreement could not be
considered abandoned by the mere say-so of one of
the parties thereto. Further, RTC reasoned that the
Estate need not even be informed of
the Agreement for its validity because the Estate was
not a party to this, and as such, the
Agreement remained binding as between Plania and
Conejos.
The trial court validated the Minutes of the
Hearing noting that it was an official document issued
by the Pangkat Secretary and attested by
the Pangkat Chairman and that its authenticity was
never put in question. It ruled that the Minutes was
admissible and should be given weight as it did not
lose its evidentiary value as a record of what
transpired during the meeting despite the lack of
signatures of Plania and Conejos. In lending credence
to the claim of Plania that he paid some amounts of
money to the Estate, the RTC stressed that it was
understandable that the official receipts were issued in
the name of Conejos and not in the name of Plania,
considering that Conejos was the original buyer of the
property. To require the Estate to issue official
receipts in the names of both Plania and Conejos would
have complicated the matter considering that Estate
was not privy to the Memorandum of Agreement.
Conejos moved for MR but this was denied, hence
she filed a Petition for Review with the Court of
Appeals. Finding no merit in her arguments, the CA
affirmed the RTC concluding that there was dearth of
evidence that the Memorandum of Agreement had
been mutually abandoned by the parties. It likewise
debunked the thesis of Conejos that the Minutes of the
Hearing was unenforceable for lack of signatures.
Conejos's MR having been denied, she filed the instant
Petition for Certiorari.

Issue: Did the CA gravely abuse its discretion (a) in
not ruling that there was mutual cancellation by both
parties of the Memorandum of Agreement ; and, (b) in
giving any probative value to the Minutes of
Hearing and the official receipts presented in evidence
by Plania? No; case dismissed based on procedural
law. Court did not rule on the merits.

Held: Petition for Certiorari is DISMISSED as a wrong
remedy and for utter lack of merit.

Ratio: At first glance, Conejoss Petition for Certiorari
should be summarily dismissed for adopting the wrong
mode of appeal. The Court of Appeals promulgated its
Decision dismissing Conejos's petition for review on 9
January 2001 and received by Conejos on 22 January
2001. Conejos filed a motion for reconsideration on 29
January 2001 but the Court of Appeals denied the
same in its Resolution of 31 May 2001, notice of which
was received by Conejos on 13 June 2001. Conejos's
remedy would have been to file a petition for review on
certiorari before this Court, and, counting fifteen (15)
days from receipt of the resolution denying her motion
for reconsideration Conejos had until 28 June 2001 to
file a petition for review on certiorari before this
Court. However, instead of a petition for review on
certiorari Conejos filed on 13 August 2001 a petition
for certiorari or one (1) month and twenty-five (25)
days after the lapse of the allotted period within which
to file a petition for review on certiorari.
Apparently, Conejos resorted to this special civil
action after failing to appeal within the fifteen (15)-day
reglementary period. This cannot be
countenanced. The special civil action of certiorari
cannot be used as a substitute for an appeal which
Conejos already lost. Certiorari lies only where there
is no appeal nor any plain, speedy, and adequate
remedy in the ordinary course of law. There is no
reason why the question being raised by
Conejos, i.e., whether the appellate court committed a
grave abuse of discretion in dismissing petitions, could
not have been raised on appeal.
Concededly, there were occasions when this Court
treated a petition for certiorari as one filed under Rule
45 of the Rules of Court. However, the circumstances
prevailing in the instant case do not justify a deviation
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from a general rule. Notably, the instant petition was
filed way beyond the reglementary period allowed
under Rule 45 without any justifiable reason therefor
nor any reasonable explanation being proffered by
Conejos. In addition, the arguments she cited are
without merit and are in fact mere rehash of the issues
raised before and judiciously resolved by the courts a
quo. The issues require a review of the factual
findings which, verily, could not be done because this
Court is not a trier of facts. More importantly, a
reading of the records of the case strengthens our
disposition that both the trial and the appellate courts
did not abuse their discretion in assessing their factual
findings. We find their conclusions amply supported by
the records of the case and grounded in law.


OAMINAL vs. CASTILLO

FACTS: Petitioner Henry Oaminal filed a complaint
against Respondents Pablito and Guia Castillo with the
RTC for collection of sum of money. Summons
together with the complaint was served upon Ester
Fraginal, secretary of Mrs. Castillo, on May 30, 2000.
On June 6, 2000, the Castillos filed an Urgent Motion
to Declare Service of Summons Improper and Legally
Defective, alleging that the Sheriffs Return has failed
to comply with the Rules on substituted service of
summons. The scheduled hearing of the Urgent Motion
(July 14, 2000) did not take place as RTC Judge
Zapatos took a leave of absence. On Oct. 19, 2000,
Oaminal filed an Omnibus Motion to Declare
Respondents in Default and to Render Judgment
because no Answer was filed by the Castillos. On Nov.
9, 2000, the Castillos then filed the following: (a)
Omnibus Motion Ad Cautelam to Admit Motion to
Dismiss and Answer with Compulsory Counterclaim;
(b) Urgent Motion to Dismiss, anchored on the premise
that Oaminals complaint was barred by improper
venue and litis pendentia; and (c) Answer with
Compulsory Counterclaim. On Nov. 16, 2000, the RTC
Judge issued an Order denying the Castillos Motion
but admitted their Answer. The Castillos then filed an
Urgent Motion to Inhibit Ad Cautelam against Judge
Zapatos, in the higher interest of substantial justice
and the rule of law. Judge Zapatos denied the motion
by issuing an Order dated Dec. 27, 2000. Again, on
Jan 22, 2000, the Castillos filed another Urgent
Motion, praying that the Honorable Court reconsider
its Nov. 16, 2000 Order, by dismissing the case
against them on the ground of improper venue. In the
alternative, the Castillos Urgent Motion prayed that
the Judge Zapatos reconsider and set aside its Dec.
27, 2000 Order by inhibiting himself from the case.
Judge Zapatos ruled that the Castillos Omnibus
Motion Ad Cautelam to Admit Motion to Dismiss and
Answer with Counterclaim was filed outside the period
to file answer, thus he (1) denied the Motion to Admit
Motion to Dismiss and Answer; (2) declared the
Castillos in default; and (3) ordered Oaminal to
present evidence ex-parte within ten days from receipt
of the order, otherwise, the case will be dismissed. The
RTC then rendered a decision on the merits in favor of
Oaminal.
On Sept. 11, 2001, the Castillos filed with
the CA a Petition for certiorari, prohibition and
injunction, with a prayer for a writ of preliminary
injunction, raising the issue of whether the RTC validly
acquired jurisdiction over them. The CA ruled in favor
of the Castillos, saying that the RTC did not validly
acquire jurisdiction over them because summons had
been improperly served on them.

ISSUE: W/N the Petition for certiorari was
proper.

(NOTE: Oaminal contends that the certiorari Petition
filed by the Castillos with the CA was improper because
other remedies in the ordinary course of law were
available to them.)

HELD/RATIO: YES.

Well-settled is the rule that certiorari will lie only when
a court has acted without or in excess of jurisdiction or
with grave abuse of discretion. As a condition for the
filing of a petition for certiorari, Section 1 of Rule 65 of
the Rules of Court additionally requires that no appeal
nor any plain, speedy and adequate remedy in the
ordinary course of law must be available. It is
axiomatic that the availability of the right of appeal
precludes recourse to the special civil action for
certiorari. Here, the trial courts judgment was a final
Decision that disposed of the case. It was therefore a
fit subject of an appeal. However, instead of appealing
the Decision, respondents filed a Petition for certiorari.
Be that as it may, a petition for certiorari
may be treated as a petition for review under
Rule 45. Such move is in accordance with the liberal
spirit pervading the Rules of Court and in the interest
of substantial justice, especially (1) if the petition
was filed within the reglementary period for
filing a petition for review; (2) errors of
judgment are averred; and (3) there is sufficient
reason to justify the relaxation of the rules.
Besides, it is axiomatic that the nature of an action is
determined by the allegations of the complaint or
petition and the character of the relief sought. As the
SC explained in Delsan Transport vs CA, It cannot x x
x be claimed that this petition is being used as a
substitute for appeal after that remedy has been lost
through the fault of petitioner. Moreover, stripped of
allegations of grave abuse of discretion, the petition
actually avers errors of judgment rather than of
jurisdiction, which are the subject of a petition for
review
The present case satisfies all the above
requisites. The Petition for certiorari before the CA
was filed within the reglementary period of appeal. A
review of the records shows that respondents filed
their Petition on Sept. 11, 2001 -- four days after they
had received the RTC Decision. Verily, there were still
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11 days to go before the lapse of the period for filing
an appeal. Aside from charging grave abuse of
discretion and lack of jurisdiction, they likewise
assigned as errors the order and the judgment of
default as well as the RTCs allegedly unconscionable
and iniquitous award of liquidated damages. The SC
finds the latter issue particularly significant,
considering that the trial court awarded P1,500,000 as
liquidated damages without the benefit of a hearing
and out of an obligation impugned by respondents
because of petitioners failure to pay. Hence, there are
enough reasons to treat the Petition for certiorari as a
petition for review. In view of the foregoing, the SC
finds that the Petition effectively tolled the finality of
the trial court Decision. Consequently, the CA had
jurisdiction to pass upon the assigned errors.


SEBASTIAN v. Hon. MORALES and the SARENASes

FACTS: Private respondents Sarenases are the heirs of
the Guillermo Sarenas, who died intestate. Guillermo
owned 3 agricultural landholdings in Cabanatuan City
(covered by TCT Nos. NT-8607, 8608, and 8609) and
another parcel of agricultural land in Nueva Ecija (TCT
No. NT-143564).
The tenants tilling the farm lots in Cabanatuan
were issued emancipation patents pursuant to P.D. No.
27.
The heirs of Sarenas filed an application with
DAR Regional Office for retention of over 5 hectares of
the Guillermos landholdings. Among the lots they
sought to retain were those awarded to Sebastian (TCT
Nos. 8608) in Cabanatuan.
DAR Regional Office granted private
respondents application.
DAR Regional Director set aside the decision
and issued a new order, awarding instead 4.9993
hectares in land covered by TCT NT- 143564 (Nueva
Ecija).
DAR Secretary set aside the decision and
issued a new order, awarding 2.8032 hectares in land
covered by TCT Nos. 8608 (awarded to Sebastian).
The DAR Sec also found that Sebastian appeared to
have allowed cultivation of the landholding by another
person. He ruled that it was "unlawful/illegal to allow
other persons than the tenant-farmers themselves to
work on the land, except if they are only working as an
aide of the latter otherwise, landowners shall have the
recourse against the tenant-farmers
Sebastian filed a special civil action for
certiorari and prohibition, with prayer for writ of
preliminary mandatory injunction with the CA.
CA dismissed the case, without going into the
merits after finding that "petitioners pursued the
wrong mode of appeal." It found that the orders of
the DAR Secretary sought to be reviewed were final
orders for they finally disposed of the agrarian case
and left nothing more to be decided on the merits.
Hence, the proper remedy available to petitioners
was a petition for review pursuant to Rule 43,
Section 1 of the 1997 Rules of Civil Procedure, not a
special civil action for certiorari under Rule 65. The CA
also ruled that Sebastian failed to attach a certified
true copy or duplicate original of the assailed order as
required by Rule 46, Section 3, and hence, it had no
alternative but to dismiss the action.
Sebastian admitted that there was error in the
remedy resorted to before the CA. They insist,
however, that a perusal of their initiatory pleading in
would show that said pleading contained all the
features and contents for a petition for review under
Rule 43, Section 6. Hence, the court should have
treated their special civil action for certiorari and
prohibition as a petition for review under Rule 43,
since dismissals based on technicalities are frowned
upon.

ISSUE: WON CA erred in dismissing the case and in
not treating the petition as a petition for reviewNO

RATIO: Litigation is not a game of technicalities, but
every case must be prosecuted in accordance with the
prescribed procedure so that issues may be properly
presented and justly resolved. Hence, rules of
procedure must be faithfully followed except only when
for persuasive reasons, they may be relaxed to relieve
a litigant of an injustice not commensurate with his
failure to comply with the prescribed procedure. In the
instant case, Sebastian failed to show any compelling
reason for not resorting to the proper remedy. Instead,
we find from our perusal of their pleadings before the
CA that they stoutly and persistently insisted that the
extraordinary remedy of certiorari was their correct
remedy.
Sebastians ground for questioning the orders
of the DAR Secretary was that it was "issued and
promulgated with grave abuse of discretion . . . a
mounting to lack of jurisdiction." Note that this is
precisely the office of an action for certiorari under
Rule 65. Second, after CA dismissed their petition on
the ground that the proper remedy was a petition for
review, Sebastian continued to insist in their MR that
under Section 54 of R.A. No. 6657 (Comprehensive
Agrarian Reform Law), a petition for certiorari is both
adequate and proper. It was only as an afterthought
that they asked CA to treat their special civil action for
certiorari as a petition for review.
An appeal from the decision of the Court of
Appeals, or from any order, ruling or decision of the
DAR, as the case may be, shall be by a petition for
review with the Supreme Court, within a non-
extendible period of fifteen (15) days from receipt of a
copy of said decision.
Section 60 of CARP should be read in relation
to R.A. No. 7902 expanding the appellate jurisdiction
of the Court of Appeals to include:
Exclusive appellate jurisdiction over all final
judgments, decisions, resolutions, orders or
awards of Regional Trial Courts and quasi-
judicial agencies, instrumentalities, boards or
commissionsexcept those falling within the
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appellate jurisdiction of the Supreme Court in
accordance with the Constitution, the Labor
Code of the Philippines under Presidential
Decree No. 442, as amended, the provisions of
this Act, and of subparagraph (1) of the third
paragraph and subparagraph (4) of the fourth
paragraph of Section 17 of the Judiciary Act of
1948.
With the enactment of R.A. No. 7902, this
Court issued Circular 1-95 governing appeals from all
quasi-judicial bodies to the Court of Appeals by
petition for review, regardless of the nature of
the question raised. Said circular was incorporated
in Rule 43 of the 1997 Rules of Civil Procedure.
Section 61 of CARP clearly mandates that
judicial review of DAR orders or decisions are governed
by the Rules of Court. The Rules direct that it is Rule
43 that governs the procedure for judicial review of
decisions, orders, or resolutions of the DAR Secretary.
By pursuing a special civil action for certiorari under
Rule 65 rather than the mandatory petition for review
under Rule 43, petitioners opted for the wrong mode of
appeal. Pursuant to the fourth paragraph of Supreme
Court Circular No. 2-90, "an appeal taken to the
Supreme Court or the Court of Appeals by the
wrong or inappropriate mode shall be
dismissed." Therefore, we hold that the Court of
Appeals committed no reversible error in dismissing
the case.
That a petition for certiorari under Rule 65
should pro forma satisfy the requirements for the
contents of a petition for review under Rule 43 does
not necessarily mean that one is the same as the
other. Or that one may be treated as the other, for
that matter. A petition for review is a mode of appeal,
while a special civil action for certiorari is an
extraordinary process for the correction of errors of
jurisdiction. It is basic remedial law that the two
remedies are distinct, mutually exclusive, and
antithetical. The extraordinary remedy of certiorari is
proper if the tribunal, board, or officer exercising
judicial or quasi-judicial functions acted without or in
grave abuse of discretion amounting to lack or excess
of jurisdiction and there is no appeal or any plain,
speedy, and adequate remedy in law. A petition for
review, on the other hand, seeks to correct errors of
judgment committed by the court, tribunal, or officer.
In the instant case, Sebastian failed to show
any grave abuse of discretion amounting to want of
jurisdiction on the part of the DAR Secretary. When a
court, tribunal, or officer has jurisdiction over the
person and the subject matter of the dispute, the
decision on all other questions arising in the case is an
exercise of that jurisdiction. Consequently, all errors
committed in the exercise of said jurisdiction are
merely errors of judgment. Under prevailing procedural
rules and jurisprudence, errors of judgment are not
proper subjects of a special civil action for certiorari.

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ORBETA v. SENDIONG

FACTS: On March 1925, Simeona Montenegro sold to
spouses Orbeta a 4622 sqm. parcel of land in
Dumaguete. The land sold EXCLUDED a 884 sqm
portion in which the house of Montenegros
grandmother was built. This was not included in the
sale. In 1934, Orbeta, in turn, sold the land to spouses
Sendiong.
On December 1956, Sendiong spouses donated
the land to Luis Sendiong who thereafter sold the
easternmost undivided portion to Pretzylou
Sendiong. Luis kept the other undivided half.
In 1968, the Orbeta heirs insisted that
Montenegro execute a quitclaim, which she did,
acknowledging and ratifying the sale of the land to the
spouses Orbeta. On the same day, Orbeta heirs also
executed and Extra-judicial Settlement and Partition
pertaining to the estate of their mother.
Montenegro eventually lost possession over the
884 sqm portion which was excluded in the 1925 sale,
so she filed a complaint against Luis Sendiong for
recovery of possession over said portion. The Orbeta
heirs, for their part, filed a complaint-in-intervention
praying for the recovery of possession of their portion
of the land (2311 sqm out of 4622). However, during
the pendency of this case, the case records were
destroyed by fire in the RTC. Records were not
reconstituted and the complaint was never pursued.
On May 1992, heirs of Montenegro and heirs of
Orbeta, petitioners in this case, filed before the RTC a
new complaint against Pajulas spouses (aka Pretzylou
Sendiong and husbandLuis Sendiong sold to her half
the undivided portion). The heirs filed for recovery of
possession, quieting of title and damages. Petitioners
assert that when Orbeta (husband) sold the subject
property to Sendiong spouses, it was without the
consent of his wife, and therefore, he could have
conveyed only his conjugal share (2311 of 4622 sqm).
Heirs of Montenegro reiterated claim over 884 sqm
portion excluded in the 1925 sale.
Defendant spouses filed their Answer,
asserting that the 1925 sale included the whole lot.
Also, they claim that Luis Sendiong and heirs
peacefully and openly possessed the land ever since
and the fact that Luis Sendiong heirs were not
impleaded as party defendants, even though they are
indispensible parties, as occupants of the half of the
land.
So defendants filed a motion to dismiss, on the
ground of lack of cause of action, because
indispensable parties, heirs of Luis Sendiong were not
impleaded. Petitioners opposed the motion alleging
that Luis heirs were not indispensable because they
were not in possession of the subject land which was
the very issue in the case.
RTC denied MTD. MR denied. Then defendant
spouses filed a Motion to Include Indispensable Parties,
which was denied. After petitioners rested their case,
defendants again filed a Motion to Include
Indispensable Parties. Still denied for lack of merit and
trial ensued.
In 1998, RTC ruled in favor the Montenegro
heirs and Orbeta heirs. Court said the 1925 sale did
not include the 884 sqm portion and that what Mr.
Orbeta sold without wifes consent was only his
conjugal share. Defendants sought to appeal by filinf
Notice of Appeal, but it was denied by the RTC for a
defective non-forum shopping certificate. Disallowance
of appeal was challenged in the CA but it was affirmed.
Decision became FINAL.
On Aug 2000, respondent Paul Sediong, filed a
Petition for Annulment of the decision with the CA.
Respondent allege that he was not made a party of the
case, as heir of Luis and that he came to know of the
decision only in 1999. Said the TC refused to implead
him despited repeated motions and the decision
encroached on his and sisters hereditary rights,
without due process.
Petitioners invoke rule on res judicata,
considering the issue on whether respondent is an
indispensable party has already been passed upon.
BUT, CA granted the petition for annulment and
nullified the decision, saying that respondent
was an indispensable party. Any judgment on
petitioners claims would affect respondents interest in
the land. In the absence of an indispensable party,
case renders ineffectual the proceedings, including
judgment. CA said petition for annulment of judgment
is not barred by estoppels, laches, res judicata or
forum-shopping.

ISSUE: W/N petition for annulment of judgment
should be granted.

HELD/RATIO: YES. CA decision affirmed.
Respondent Paul Sendiong and Lourdes were
indispensable parties to the case. The petitioners are
asserting their right to one half of an UNDIVIDED land.
Luis, inheriting the land from parents occupied half of
the land while Pretzylou, the other. Also, petitioners
are asserting their right over only one half of the whole
land because they base their claim on the fact that
their father sold only his half (conjugal share). But this
being a conjugal property, it would be undivided still.
So the rights of Luis Sendiong will be affected by any
judgment on the petitioners claims over the land. He
and Lourdes are indispensable parties.
Now, the matter of whether respondent is
otherwise barred from seeking the annulment of
judgment by estoppel, laches, or procedural infirmities.
Neither laches nor estoppel serves as a bar.
The petition for annulment alleges that respondent
learned of the existence the case only in 1999, or one
year after the decision therein had been rendered.
Since he was not impleaded, there is no basis to
presume that respondent was aware of the civil case
during its pendency before the RTC.
Indeed, a petition for annulment of judgment
was, at that point, the only viable remedy for
respondent to avail of, and it was utilized only one
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year after respondent learned of the existence of the
case. Laches has been defined as 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 earliernegligence or omission
to assert a right within a reasonable time, warranting
presumption that the party entitled to assert it has
abandoned it or declined to assert it. Considering that
a petition for annulment of judgment based on
extrinsic fraud may be filed within four (4) years from
discovery of the fraud, a similar petition based on lack
of jurisdiction is generally not barred by laches or
estoppel if the petition is filed within one year after
petitioner learns of the questioned decision. This
moreover holds true, as in this case, since
respondent is a foreign resident restrained by time
and distance to undertake an immediate and
proximate response, such as judicial recourse.
Res judicata does not bar the petition for
annulment either because there is no jurisdiction over
the party (Luis heirs) and there is no identity of the
parties in both cases (Luis heirs not party to the
annulled decision).


NERI V. LEYSON

Facts:
Petitioners Nery claim that they are the
children of Mercedes del Rio (who died during
World War II) and are heirs of their maternal
grandmother Agatona del Corro (who was a
widow when she died in 1976). When Mercedes
died, she left her share in the parcel of land
covered by OCT No. RO-0083 and registered in
the name of Agatona.
After Mercedes death, her heirs executed an
Extrajudicial Partition and Declaration of Heirs
covering Mercedes share in the land. Her
death was duly annotated on the title on Feb.
1964.
On December 2, 1964, a Notice of Lis Pendens
(regarding Civil Case No. R-8646) was
executed and annotated on the title by Atty.
Hermosisima, representing Respondents
Leyson.
o The Leysons previously filed a case for
annulment and cancellation of OCT No.
RO-0083 in Civil Case No. R-8646.
They traced their title through OCT No.
15615, which was in the name of their
father Jose Leyson who acquired the
land through purchase from Rosario
Miranda. The Leysons were in
possession of the property until 1963
when Agatona and her children took
possession of the land. On May 2,
1968, the CFI ruled in favor of the
Leysons declaring OCT No. RO-0083
null and void. Defendants Agatona
appealed the decision to the CA, which
affirmed the CFIs decision. However,
for failure to appeal the CA decision,
the decision became final and executor
on April 10, 1976 as shown by the
Entry of Judgment.
The Nerys claim that they were not made
parties to the case and that although Mercedes
was impleaded as defendant, she was already
dead when the case was filed in 1964. Thus,
the Nerys argue that the decision in Civil Case
No. R-8646 does not bind them since they
were not parties thereto, and hence, the
decision is null and void.
On January 1991, the Nerys filed this case
against the Leysons seeking the declaration of
nullity of (1) TCT No. 119747 in the name of
the Leysons and (2) the judicial proceedings in
Civil Case No. R-8646. The RTC ruled in favor
of the Leysons. The CA denied the Nerys
appeal.
o CA ruling: The CA ruled that
petitioners action for annulment of
title and judicial proceedings was not
barred by res judicata, which was
inapplicable, but by the principle of
conclusiveness of judgment under Rule
39, Section 49, par. (c) of the Rules of
Court. The issue of which between the
two reconstituted titles was valid and
genuine was settled by the CA in the
earlier case (Civil Case No. R-8646).

Issue:
Whether the CA erred in ruling that the Nerys
cause of action was barred by the principle of
conclusiveness of judgment under Rule 39,
Section 49, Paragraph (c) of the Rules of
Court? Yes
Whether the CA erred in ruling that the
decision in Civil Case No. R-8646 became final
and executor against the Nerys? No

Held: Petition denied.
Conclusiveness of Judgment Issue: Petitioners
challenge the application of the principle of
conclusiveness of judgment to this case, arguing that
since jurisdiction over them was never acquired by the
trial court, barring their action is tantamount to
deprivation of property without due process of the law.
To bar the petitioners action for annulment on
the ground of res judicata, the following
elements should be present: (1) the judgment
being sought to bar the new action must be
final; (2) the decision must have been
rendered by a court having jurisdiction over
the subject matter and the parties; (3) the
disposition of the case must be based on a
judgment or an order on the merits; and (4)
there must be identity of parties, subject
matter and causes of action.
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There is clearly no identity of parties between
Civil Case R-8646 and 2379-L. The petitioners
were indispensable parties in Civil Case R-
8646, as they were the legal heirs of Mercedes
del Rio, who was one of the registered owners
in OCT RO-0083/15615 which covered the
disputed land. The Leysons failed to join the
Nerys, in violation of Rule 3, Section 7 of the
Rules of Court. Moreover, petitioners were
never served summons; neither did they join
their relatives in filing the Answer and
Amended Answer nor were they given a
chance to set up their own defenses. Plainly
then, the trial court did not acquire jurisdiction
over them. In view of the foregoing discussion,
petitioners should not be bound by the decision
in Civil Case No. R-8646. This, however, does
not justify the reversal of the assailed
Decision.

Annulment of Judgment (important part)
The reason why the herein Petition cannot be
granted is the trial courts lack of jurisdiction to
annul a final judgment of a co-equal
court. Petitioners allege that the decision in
Civil Case R-8646 passed upon the validity of
OCT RO-0083/15615. Such allegation makes
the root of their present action one for
annulment of a final judgment. This Court
cannot ignore the fact that such action is
outside the jurisdiction of the RTC.
Section 9 of BP 129 vests in the CA
[e]xclusive jurisdiction over actions for
annulment of judgments of regional trial
courts. Hence, even if the trial court in Civil
Case No. R-8646 did not acquire jurisdiction
over the petitioners, the trial court in Civil Case
No. 2379-L cannot annul the final judgment in
Civil Case No. R-8646, as jurisdiction over the
subject matter, which in this case is annulment
of final judgment, is vested by law in a higher
court, the CA.


PLATON and LIBRADA CERUILA v. ROSILYN
DELANTAR, represented by her guardian, DSWD

FACTS: Respondent Rosilyn Delantar filed a complaint
against her father, Simplico Delantar for child abuse,
particularly prostitution. Simplico was incarcerated at
the Pasay City Jail which prompted the filing of a
petition for involuntary commitment of Rosilyn in favor
of the DSWD, as the whereabouts of the mother,
Librada Ceruila, was unknown. The petition was
granted by the RTC-Pasay City and Simplicos motion
to vacate said judgment was denied.
The petitioner spouses Ceruilas filed a petition
before the RTC of Manila, entitled IN THE MATTER OF
CANCELLATION AND ANNULMENT OF THE BIRTH
CERTIFICATE OF MARIA ROSILYN TELIN
DELANTAR, praying that the birth certificate of Rosilyn
be canceled and declared null and void for the reasons
that said birth certificate was made an instrument of
the crime of simulation of birth and therefore invalid
and spurious, and it falsified all material entries therein
(such as: name of mother should not be Librada Telin,
the signature of the informant referring to Librada T.
Delantar being a forgery, the name of the physician
who allegedly attended at the time of the birth of
Rosilyn, being a fictitious Dr. Santos, etc.). RTC
granted the petition.
Rosilyn, represented by her legal guardian, the
DSWD, filed, with the CA, a petition for the
annulment of judgment in the petition for
cancellation of entry of her birth certificate. She
claimed that she and her guardian were not notified of
the petition and the subsequent judgment and learned
about the same only from the news a month after the
RTC decision. She argued that the RTC decision was
issued without jurisdiction and in violation of her right
to due process; that the Judge did not have authority
to declare her to be illegitimate; and that mere
correction of entries, not cancellation of the entire
certificate, is the appropriate remedy. CA ruled in favor
of Rosilyn. The CA reasoned that Rosilyn should have
been made a party-respondent to the petition for the
cancellation and annulment of birth certificate. MR
denied.
The spouses claim that the CA should have
exercised its peremptory power to declare the birth
certificate of Rosilyn as null and void ab initio following
the doctrine that where an instrument is void ab
initio for being contrary to law, no amount of
technicalities could correct its inherent nullity;
otherwise, there will be multiplicity of actions as the
parties will have to file cases anew to annul
respondents birth certificate.
On the other hand, respondent Rosilyn
contends that the CA has no authority to rule on the
merits of the case since in a petition for annulment of
judgment on the ground of lack of jurisdiction, its
authority is limited to ruling on whether or not the
petitioner was denied due process of law; that if the
CA were to rule on the merits of the case, it would
have deprived respondent of due process; and that in
any case, respondents record of birth is not void as
Librada was only able to prove that she is not the
mother of respondent.

ISSUE: Whether or not the CA should have exercised
its peremptory power to declare the subject birth
certificate null and void ab initio

HELD: No. CA was correct in not exercising such
power.
There is no merit in the contention of
petitioners that because of the false entries in the birth
certificate of Rosilyn, the same is void ab initio, hence
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should be nullified under Art. 5
1
of the Civil Code, or
should be nullified by the CA in exercise of its
peremptory power to declare null and void the said
certificate.
The function of a petition for annulment of
judgment, under Rule 47 of the Rules of Court, is not
to replace the trial courts decision sought to be
annulled. The action under Sections 1, 2 and 7 of said
Rule, to wit:

Section. 1. Coverage. --- This
Rule shall govern the annulment by the
Court of Appeals of judgments or final
orders and resolutions in civil actions
of Regional Trial Courts for which the
ordinary remedies of new trial, appeal,
petition for relief or other appropriate
remedies are no longer available
through no fault of the petitioner.
Sec. 2. Grounds for
annulment. --- The annulment may be
based only on the grounds of extrinsic
fraud and lack of jurisdiction.
Extrinsic fraud shall not be a
valid ground if it was availed of, or
could have been availed of, in a motion
for new trial or petition for relief.
Sec. 7. Effect of judgment. ---
A judgment of annulment shall set
aside the questioned judgment or final
order or resolution and render the
same null and void, without prejudice
to the original action being refiled in
the proper court. However, where the
judgment or final order or resolution is
set aside on the ground of extrinsic
fraud, the court may on motion order
the trial court to try the case as if a
timely motion for new trial had been
granted therein.

is merely for the annulment of the RTC Decision on
grounds of extrinsic fraud and lack of jurisdiction,
nothing more. The Rules do not allow the CA to
resolve the merits of the petition for the amendment
and cancellation of the birth certificate of Rosilyn or to
substitute its own findings thereon.


SALERA V A1 INVESTORS

FACTS: On August 27, 1992, Teodora Salera, mother
of the petitioners, contracted a P50,000.00 loan and
issued a promissory note to respondent A-1 Investors,
Inc. Salera defaulted and A-1 filed a complaint (First
Case) in the MTC, Quezon City against Teodora and
impleaded her husband, Saturnino Sr. The summons

1
Art. 5. Acts executed against the provisions of mandatory or
prohibitory laws shall be void, except when the law itself authorizes
their validity.
for the said case was given by the sheriff to the
couples son, Samuel at the familys residence but
Samuel refused to sign receipt of a copy thereof.
Saturnino claims that he was living in Clarin,
Bohol as he ran for mayor and was elected as such in
the 1995 elections. He and his wife did not receive the
summons that was sent in Cebu. Consequently, the
spouses were held in default and a decision was
rendered on November 27, 1996 against the spouses.
Copy of the decision was received by a certain
Joel Ario, but Saturnino was then still residing in
Bohol. The Salera spouses did not appeal and the
decision became final and executory. On April 23,
1997, Saturnino Sr.s daughter, Sarah received a writ
of execution and a notice of levy upon Realty pursuant
to writ of execution. Although Sarah was 28 years old
and a college graduate, she simply received the
documents and without reading them, placed them in
her drawer without informing her parents about them,
and completely forgot about them. It was only a week
after that she showed the documents to her parents
The son informed the father of the Notice to
Parties of Public Auction stating that the Sheriff will sell
the Salera spouses property pursuant to a writ of
execution. The property consisted of a parcel of land
covered by a TCT with an area of 405 square meters.
Saturnino filed a complaint for injunction
(Second Case) with damages against A-1 investors
before the RTC of Cebu city and prayed that damages
be awarded in his favor. He also prayed for a TRO and
followed by a preliminary injunction (PI). The RTC of
Cebu granted his prayer, issuing a TRO, subsequently
a PI. It gave due course to the argument of Saturnino
as he was unaware of the proceedings in the civil
action; that it was his wife who contracted the debt,
not him; and that even assuming that he is liable as
well, A1 cannot levy on the family home, as it was
exempt from execution.
Saturnino died and was substituted by his children.
The wife waived all her inheritance in the estate of the
husband. A-1 filed a petition for certiorari and
prohibition in the CA. the Ca ruled in his favor.

Issue: Whether or not the complaint for injunction
may be treated as a petition to annul the decision in
the earlier case.

RATIO: While petitioners (Salera) are correct that a
complaint for injunction is a recognized remedy to
enjoin the performance of an act,

which action falls
within the province of Regional Trial Courts,

it must be
taken into account that Saturnino, Sr. sought to
permanently enjoin the public auction of property
levied pursuant to a writ of execution issued in the
First Case on the ground that he was not served with
summons and was denied due process. In doing so,
Saturnino, Sr. was actually seeking the annulment of
the decision in the First Case, which was the basis of
the writ of execution pursuant to which the public
auction was to be held. The proper remedy for
petitioners' predicament is therefore not an action for
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injunction, but for annulment of judgment.
It is thus understandable why petitioners are
staunch in claiming, in hindsight, that although the
complaint filed in the RTC of Cebu was captioned
"Injunction with Damages," the allegations therein
suffice to constitute an action for annulment of the
decision in the First Case for lack of due process
amounting to lack of jurisdiction and/or extrinsic fraud.
The issue of whether or not the Metropolitan Trial
Court of Quezon City did not acquire jurisdiction over
the person of Saturnino, Sr. in the First Case and his
exclusion from the proceedings in said case amounted
to extrinsic fraud which denied him of due process
should be properly resolved in an action for annulment
of judgment

Rule 47:
Sec. 2. Grounds for annulment.- The annulment may
be based only on the grounds of extrinsic fraud and
lack of jurisdiction.
Sec. 4. Filing and contents of petition.- The action shall
be commenced by filing a verified petition alleging
therein with particularity the facts and the law
relied upon for annulment, as well as those
supporting the petitioner's good and substantial
cause of action or defense, as the case may be.. . .
A certified true copy of the judgment or final order or
resolution shall be attached to the original copy of the
petition intended for the court and indicated as such by
the petitioner.
The petitioner shall also submit together with
the petition affidavits of witnesses or documents
supporting the cause of action or defense and a sworn
certification that he has not theretofore commenced
any other action involving the same issues in the
Supreme Court, the Court of Appeals or different
divisions thereof, or any other tribunal or agency; if
there is such other action or proceeding, he must state
the status of the same, and if he should thereafter
learn that a similar action or proceeding has been filed
or is pending before the Supreme Court, the Court of
Appeals, or different divisions thereof, or any other
tribunal or agency thereof within five (5) days
therefrom."
It is clear from the contents of the complaint
filed by the petitioners that the action is not for
annulment of the decision in Civil Case No. 15996. It
does not allege "with particularity the facts and the law
relied upon for annulment, as well as those supporting
the petitioner's good and substantial cause of action"
which petitioners now claim are extrinsic fraud and
lack of jurisdiction. Neither is a certified true copy of
the decision in the First Case attached to the original
copy of the petition intended for the court and
indicated as such by the petitioner. Nor were affidavits
of witnesses or documents supporting the cause of
action, i.e., annulment of judgment on the ground of
lack of jurisdiction and extrinsic fraud, submitted
together with the complaint. Petitioners cannot now
mislead the court into treating the complaint for
injunction as an action for annulment of judgment with
the ancillary remedy of injunction.


COLE V ALFARO

Facts: The case began from a sale of townhouse unit
owned by Agda which gave rise to 5 petitions
stemming from the complaint for non-delivery of title
filed by spouses Aurora, Cinco, Jingco,Cingco-Jingco
and Cole w/ the HLURB Arbiter against Agda and PNB.
On Feb 20, 1991 the HLURB arbiter rendered
judgment against Agda and PNB. HLU Board of
Commisioners affirmed the decision. The Office of the
Pres also affirmed the decision.
Agda questioned the arbiters decision to the
CA via petition for certiorari. After 6 years from
rendering the arbiters decision the CA dismissed the
petition ruling that the HLURB Rules of Procedure
provided that the decision of the Arbiter may be
appealed to the Board and thereafter to the Office of
the President and also laches. The decision became
final and executory on July 23, 1997, and an entry of
judgment was made on November 13, 1997.
On October 21, 1995, Agda filed with the QC
RTC an action for rescission of contracts against
spouses Cole to nullify the Memorandum of
Agreement selling one townhouse unit to them. Coles
children substituted him upon his death and his son
Charles moved to dismiss on the ground of lack of
jurisdiction. TC denied the motion so Cole filed
petition for certiorari with the CA. (1
st
petition)
The CA dismissed Agdas complaint because of
forum shopping and that the Boards decision is res
judicata to the rescission case in the RTC. Agda
appealed to the SC. The SC dismissed the appeal for
filing beyond the period which became final and
executory on February 2, 1999.
On August 28, 1997, Agda filed with the CA a
petition for annulment of judgment of the Arbiters
decision rendered on February 20 and that of the
Office of the President dated February 27. Cole moved
to dismiss. Because of the inaction by the CA on the
MtD Cole filed a petition for mandamus with
preliminary injunction and temporary restraining order
with the SC to compel the CA to resolve his Mtd and to
summarily dismiss the petition for annulment.(2
nd

petition) Despite the pending annulment proceeding
Agda on Feb 25, 99 filed a petition for review with the
Office of the pres questioning the Boards decision. The
OoP issued an order requiring Agda to pay the appeal
fee and the Coles to submit memoranda. Cole filed
another petition for certiorari asking for the dismissal
of the petition. SC dismissed the petition and denied
the mr.
On June 30, 1999, CA declared null and void the
arbiters decision and the OoPs decision dated for
having been rendered without jurisdiction. 2 petitions
for annulment of judgment were filed, the first on July
14, 1999 by Lolita Cole and her son Atty. Cole and the
second, on September 7, 1999, by Charito Cole-Alfaro,
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daughter of Lolita Cole.(3
rd
and 4
th
petitions) While
these cases were pending, Cole moved for the
execution of the arbiters Feb 20 decision but because
of Agdas petition with the OoP the Arbiter denied
issuance of the writ of execution which led to Cole
filing his 5
th
petition.

HELD:
The 2
nd
petition for the dismissal of annulment of
judgment filed by Agda with the CA is dismissed
because it was moot.
The 5
th
petition questioning the Arbiters refusal
to issue the writ of execution is improper and
premature. The 1996 Rules of Procedure of the
HLURB provides that the decision of the Arbiter is
reviewable by the Board of Commissioners. From the
decision of OoP, the aggrieved can resort to the CA
which exercises exclusive appellate jurisdiction over all
final judgments of quasi-judicial agencies. SC
dismissed the petition for failure to exhaust
administrative remedies.
(RELEVANT) 3rd and 4
th
petition: Under Rule
47 of the Rules of Court, the remedy of annulment of
judgment is confined to decisions of RTC on the ground
of extrinsic fraud and lack of jurisdiction,
RULE 47
ANNULMENT OF JUDGMENTS OR FINAL ORDERS
AND RESOLUTIONS
SECTION 1. Coverage.This Rule shall govern
the annulment by the Court of Appeals of judgments or
final orders and resolutions in civil actions of Regional
Trial Courts for which the ordinary remedies of new
trial, appeal, petition for relief or other appropriate
remedies are no longer available through no fault of
the petitioner. (n)

SEC. 2. Grounds for annulment.The annulment
may be based only on the ground of extrinsic fraud
and lack of jurisdiction.
Extrinsic fraud shall not be a valid ground if it was
availed of, or could have been availed of, in a motion
for new trial or petition for relief. (n)
Although the grounds are fraud and lack of
jurisdiction, it cannot prosper because the decision
sought to be annulled was not rendered by the RTC
but by an administrative agency (HLU Arbiter and
Office of the President), so is not within the jurisdiction
of the Court of Appeals. Even assuming that it can be
treated as a petition for review under Rule 43 it should
still be dismissed by the CA because no error of
judgment was imputed. A petition for annulment of
judgment is an initiatory remedy so no error of
judgment can be its subject.



FINALS
COVERAGE:
Provrem
SCA
Crimpro
Evidence
SpecPro (No cases)


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RULE 57: ATTACHMENT

SECURITY PACIFIC v AMELIA TRIA-INFANTE

Facts: Anzures filed a complaint against Villaluz for
violation of BP 22. Anzures filed an Ex-Parte Motion
for Preliminary Attachment praying that pending the
hearing on the merits of the case, a Writ of Preliminary
Attachment be issued ordering the sheriff to attach the
properties of Villaluz. The Writ was issued upon the
posting of a bond duly approved by the court. The
sheriff attached certain properties of Villaluz, which
were duly annotated on the TCTs.
The RTC acquitted Villaluz of the crime but
held her civilly liable. CA affirmed. Villaluz elevated
case (GR 106214) to SC and during its pendency,
posted a counter-bond issued by petitioner Security
Pacific Assurance Corp. On the same day, she filed an
Urgent Motion to Discharge Attachment. The SC
affirmed CA decision.
Anzures moved for execution, RTC issued a
Writ of Execution. Sheriff tried to serve the writ upon
Villaluz, but the latter no longer resided in her given
address. Sheriff sent a Notice of Garnishment upon
Security Pacific by virtue of the counter-bond.
Security Pacific refused to assume its obligation on the
counter-bond it posted for the discharge of the
attachment. Anzures filed a motion to proceed with
the garnishment, which was opposed by Security
Pacific contending that it should not be held liable on
the bond. RTC granted.
Security Pacific filed a petition for certiorari
with the CA, contending that respondent Judge and
sheriff committed grave abuse of discretion and grave
errors of law in proceeding against it on its counter-
attachment bond, despite the fact that said bond was
not approved by the SC and that the condition by
which said bond was issued did not happen. CA
dismissed.
While the case was pending with the SC,
Anzures executed a Memorandum of Understanding,
stipulating the total amount garnished from Security
Pacific as well as the remaining amount sought to be
executed. Security tendered and paid the amount of
P300k upon signing and the balance of P658k was to
be paid in installments. There was a provision in the
MOU which states that the this contract shall not be
construed as a waiver or abandonment of the appellate
review pending before the SC and that it will be
subject to all such interim orders and final outcome of
said case.
Before the SC, Security seeks to escape
liability by contending that the writ of attachment
against the real properties of Villaluz was not
discharged (no court order of discharge in GR106214)
and hence, its liability did not accrue. Anzures, on the
other hand, asserts that the filing of the counter-bond
by Villaluz had already ipso facto discharged the
attachment on the properties and made the petitioner
liable on the bond.

Issue: Whether the attachment was ipso facto
discharged by the mere filing of the counter-bond in
court - YES

Ratio: Under the Rules, there are 2 ways to secure the
discharge of an attachment. First, the party whose
property has been attached or a person appearing on
his behalf may post a security. Second, said party
may show that the order of attachment was improperly
or irregularly issued. The first applies in this case. It
should be noted that in the resolution of GR 106214,
the SC permitted Villaluz to file a counter-attachment
bond and required the private respondents to comment
on its sufficiency. It is quite palpable that the
necessary steps in the discharge of an attachment
upon giving the counter-bond have been taken. To
requires a specific order for the discharge when the SC
had already declared that Security is solidarily bound
with Villaluz would be mere surplusage.
Although the SC ruled in Besile Investment
that the mere posting of a counterbond does not
automatically discharge the writ of attachment, since
this needs hearing and order, the SC in this case had
already virtually discharged the attachment after all
the parties were heard on the matter in a previous
resolution.


TORRES V. SATSATIN

Facts: The siblings Sofia Torres (Sofia), Fructosa
Torres (Fructosa), and Mario Torres (Mario) each own
adjacent 20,000 square meters track of land. In 1997,
Nicanor Satsatin (Nicanor) asked petitioners mother,
Agripina Aledia, if she wanted to sell their lands. After
consultation with the siblings, Agrapina agreed to allow
Nicanor to sell the properties for them. They
authorized Nicanor, through a Special Power of
Attorney, to negotiate for the sale of the properties.
Nicanor offered to sell the properties to Solar
Resources, Inc. (Solar). Solar allegedly agreed to
purchase the three parcels of land, together with the
10,000-square-meter property owned by a certain
Rustica Aledia, for P35,000,000.00. Nicanor was
supposed to remit to them the total amount of
P28,000,000.00 or P9,333,333.00 each to Sofia,
Fructosa, and the heirs of Mario.
Despite the fact that Solar has already paid the
entire purchase price of P35,000,000.00 to Nicanor,
has only remitted the total amount of P9,000,000.00,
leaving an unremitted balance of P19,000,000.00.
Despite repeated verbal and written demands, Nicanor
failed to remit to them the balance of P19,000,000.00.
Nicanor allegedly acquired a house and lot at Vista
Grande BF Resort Village, Las Pias City and a car,
which he registered in the names of his unemployed
children.
The siblings then filed a Complaint for sum of money
and damages, against Nicanor and his unemployed
children. They also filed an Ex-Parte Motion for the
Issuance of a Writ of Attachment, alleging among
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other things: that respondents are about to depart the
Philippines.
Thereafter, the RTC issued a Writ of
Attachment dated November 15, 2002, directing the
sheriff to attach the estate, real or personal, of the
respondents.
On November 19, 2002, a copy of the writ
of attachment was served upon the respondents.
On the same date, the sheriff levied the real and
personal properties of the respondent, including
household appliances, cars, and a parcel of land
located at Las Pias, Manila.
On November 21, 2002, summons,
together with a copy of the complaint, was
served upon the respondents.
On the same day respondents filed their
answer, they also filed a Motion to Discharge Writ of
Attachment claiming that there was irregularity in the
issuance and implementation of the writ of
attachment.

Issue: Was there irregularity in the issuance and
implementation of the writ of attachment?

Held: YES. There was irregularity in BOTH the issuance
and implementation. With regard to the
implementation, every bond should be accompanied by
a clearance from the Supreme Court showing that the
company concerned is qualified to transact business,
which is valid only for thirty (30) days from the date of
its issuance.

However, it is apparent that the
Certification

issued by the Office of the Court
Administrator (OCA) at the time the bond was issued
would clearly show that the bonds offered by Western
Guaranty Corporation may be accepted only in the
RTCs of the cities of Makati, Pasay, and Pasig.
Therefore, the surety bond issued by the bonding
company should not have been accepted by the RTC of
Dasmarias, Branch 90, since the certification secured
by the bonding company from the OCA at the time of
the issuance of the bond certified that it may only be
accepted in the above-mentioned cities. Thus, the trial
court acted with grave abuse of discretion amounting
to lack of or in excess of jurisdiction when it issued the
writ of attachment founded on the said bond.
With regard to the implementation, the grant
of the provisional remedy of attachment involves three
stages: first, the court issues the order granting the
application; second, the writ of attachment issues
pursuant to the order granting the writ; and third, the
writ is implemented. For the initial two stages, it is not
necessary that jurisdiction over the person of the
defendant be first obtained. However, once the
implementation of the writ commences, the court must
have acquired jurisdiction over the defendant, for
without such jurisdiction, the court has no power and
authority to act in any manner against the defendant.
In this case, the trial court had not acquired
jurisdiction by serving summons upon the respondents
prior to or simultaneously with the implementation of
the writ of attachment as required by the rules of
court. The trial court validly issued the writ of
attachment on November 15, 2002, which was
implemented on November 19, 2002, it is to be noted
that the summons, together with a copy of the
complaint, was served only on November 21, 2002.


INSULAR SAVINGS V. COURT OF APPEALS

Facts: Far East Bank and Trust Company instituted an
Arbitration case against Insular Savings Bank. The
dispute involved 3 unfunded checks with a total value
of P25.2M. The checks were drawn against Far East
Bank and were presented by Insular Bank for clearing.
Insular Banks account with Philippine Clearing House
Corporation (PCHC) was credited with P25.2M. When
Far East Bank returned the check beyond the
reglementary period, Insular Savings refused to refund
the money to Far East Bank. Pending arbitration, Far
East Bank instituted a civil case praying for the
issuance of a writ of preliminary attachment. RTC
granted the application for preliminary attachment
upon posting by Far East Bank of an attachment bond
of P6M. Bond posted and attachment issued. In one of
the arbitration hearing, the banks agreed to divide
between them the disputed amount (P12.6M) while the
dispute has not yet been resolved. Later on, Insular
Savings filed a motion to discharge attachment by
counter-bond in the amount of P12.6M, which was
denied by the court. MR denied as well. Petition for
certiorari to the CA was denied as well ALTHOUGH CA
acknowledged that RTC judge erred in his order that
the counterbond should be P27.2M because he
erroneously included unliquidated claims, such as
actual and exemplary damages, attorneys fees and
expenses of litigation. MR denied.

Issue: Whether or not the trial court erroneously
denied Insular Savings Banks motion to discharge
attachment by counterbond in the amount of P12.6M

Held: Yes. Insular Savings Bank wins.
The amount of the counter-attachment bond is
to be measured against the value of the attached
property, as determined by the judge to secure the
payment of any judgment that the attaching creditor
may recover in the action. Without necessarily
diminishing the sound discretion of the issuing judge
on matters of bond approval, the counter-bond should
as much as possible correspond in value to, or
approximately match the attaching creditors principal
claim. Excessive attachment should be avoided.
In the case at bar, the records show that the
principal claim is in the amount of P25.2M. However,
before the Arbitration Committee of PCHC, the parties
agreed to equally divide between themselves, on a
temporary basis, the disputed amount, subject to the
outcome of the arbitration proceedings. Therefore, Far
East Banks principal claim against Insular Savings
prior to the filing of the motion to discharge
attachment has been pruned down to P12.6M.
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Accordingly, the trial court should have allowed a total
discharge of the attachment on a counterbond in the
amount of P12.6M based on the reduced claim of Far
East Bank. If a portion of the claim is already secured,
there is no justifiable reason why such portion should
still be subject of counter-bond.
Section 12 of Rule 57 provides that the court
shall order the discharge of attachment if the movant
makes a cash deposit, or files a counter-bond . . . in
an amount equal to that fixed by the court in the order
of attachment, exclusive of costs.


YU v. NGO TE

FACTS:
- Spouses Gregorio and Josefa Yu (Spouses Yu)
purchased from Ngo Yet Te (Te) bars of detergent
soap worth P594,240.00, and issued to the latter
three postdated checks as payment which were
subsequently returned dishonored and stamped
ACCOUNT CLOSED.
- Te demanded payment from Spouses Yu but they
refused. Te filed with the RTC a Complaint for
Collection of Sum of Money and Damages with
Prayer for Preliminary Attachment.
- In support of her prayer for preliminary
attachment, Te attached to her Complaint an
Affidavit executed by Sy that Spouses Yu were
guilty of fraud in entering into the purchase
agreement for they never intended to pay the
contract price, and that, based on reliable
information, they were about to move or dispose of
their properties to defraud their creditors.
- Upon Tes posting of an attachment bond, the RTC
issued an Order of Attachment/Levy on the basis
of which the Sheriff levied and attached Spouses
Yus properties in Cebu City consisting of one
parcel of land and several vehicles.
- Spouses Yu filed an Answer with counterclaim for
damages and an Urgent Motion to Dissolve Writ of
Preliminary Attachment. They also filed a Claim
Against Surety Bond in which they demanded
payment from Visayan Surety and Insurance
Corporation (Visayan Surety), the surety which
issued the attachment bond representing the
damages they allegedly sustained as a
consequence of the wrongful attachment of their
properties.
- RTC issued an Order discharging from attachment
some of the vehicles on humanitarian grounds but
maintained custody of the land and the passenger
bus. Spouses Yu filed a MR, which the RTC denied.
- CA: The writ of preliminary attachment issued by
the respondent court was improvidently issued and
should be discharged.
- Te filed a Motion for Reconsideration but to no
avail. Te filed with the SC a Petition for Review
on Certiorari but was denied. Thus, the finding of
the CA on the wrongfulness of the attachment/levy
of the properties of Spouses Yu became conclusive
and binding.
- However, the RTC, apparently not informed of the
SC Decision, rendered a Decision in favor of Te
ordering Spouses Yu to pay the former and saying
that On the counterclaim, this Court declines to
rule on this, considering that the question of the
attachment which allegedly gave rise to the
damages incurred by the defendants is being
determined by the Supreme Court.
- Spouses Yu filed with the RTC a MR questioning
the disposition of their counterclaim. RTC said that
nowhere in the decision of the Supreme Court and
for that matter, the Court of Appeals decision
which was in effect sustained by the High Court,
contains any ruling or directive or imposition, of
any damages to be paid by the plaintiff to the
defendants. The RTC also denied their 2 Notices of
Appeal.
- Spouses Yu filed with the CA a Petition
for Certiorari, Prohibition and Mandamus, which
was granted. They also questioned the RTC
Decision declining to rule on their counterclaim for
damages.
- CA affirmed in toto the RTC Decision but made a
ruling on the counterclaim of Spouses Yu by
declaring that the latter had failed to adduce
sufficient evidence of their entitlement to
damages. They filed a MR but was denied. Hence,
this Petition.

ISSUE: W/N the writ of preliminary attachment was
procured in bad faith entitling Spouses Yu to damages.

HELD/RATIO: NO! To merit an award of actual
damages arising from a wrongful attachment, the
attachment defendant must prove, with the best
evidence obtainable, the fact of loss or injury suffered
and the amount thereof. Such loss or injury must be of
the kind which is not only capable of proof but must
actually be proved with a reasonable degree of
certainty.
As to its amount, the same must be
measurable based on specific facts, and not on
guesswork or speculation. In particular, if the claim for
actual damages covers unrealized profits, the amount
of unrealized profits must be estalished and supported
by independent evidence of the mean income of the
business undertaking interrupted by the illegal seizure.
Spouses Yu insist that the evidence they
presented met the foregoing standards. They point to
the lists of their daily net income from the operation of
said passenger bus based on used ticket stubs issued
to their passengers. They also cite unused ticket stubs
as proof of income foregone when the bus was
wrongfully seized. They further cite the unrebutted
testimony of Josefa Yu that, in the day-to-day
operation of their passenger bus, they use up at least
three ticket stubs and earn a minimum daily income
of P1,500.00.
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Spouses Yus claim for unrealized income of P1,500.00
per day was based on their computation of their
average daily income for the year 1992. Said
computation in turn is based on the value of three
ticket stubs sold over only five separate days in
1992. By no stretch of the imagination can we consider
ticket sales for five days sufficient evidence of the
average daily income of the passenger bus, much less
its mean income. Not even the unrebutted testimony
of Josefa Yu can add credence to such evidence for
the testimony itself lacks corroboration. Moreover,
petitioners did not present evidence as to the damages
they suffered by reason of the wrongful attachment of
the land.
Nonetheless, the SC recognized that Spouses
Yu suffered some form of pecuniary loss when their
properties were wrongfully seized, although the
amount thereof cannot be definitively ascertained.
Hence, an award of temperate or moderate damages
in the amount of P50,000.00 is in order.

RULE 58: PRELIMINARY
INJUNCTION

UNIVERSAL MOTORS CORPORATION vs. JUDGE
FRANCISCO G. ROJAS, SR.

Facts: Universal Motors Corporation (UMC) is the
exclusive assembler and distributor in the Philippines
of Nissan light commercial vehicles and spare parts. It
maintains a network of authorized dealers who
purchase vehicles and spare parts from UMC and resell
them in specified territories in the country. One of
UMCs dealers was Nissan Specialist Sales Corporation
(NSSC) which ordered from UMC vehicles and
spareparts worth P5,476,500.00. NSSC issued several
postdated checks in favor of UMC to pay for the
purchases. The checks, however, were dishonored due
to insufficient funds. UMC demanded payment but
NSSC repeatedly failed to comply.
Hence, UMC stopped transacting with NSSC,
although NSSC still remained as dealer. UMC later
appointed Nissan Cagayan De Oro Distributors, Inc.
(NICAD) to co-exist as dealer with NSSC to meet the
market demand in Northern Mindanao. In October
2001, because of NSSCs continued failure and refusal
to pay its obligation, UMC terminated its dealership
agreement with NSSC. It also filed a criminal
complaint for violation of B.P. No. 22 and/or estafa
against the officers of NSSC.
On February 2002, NSSC filed a Civil Case for
breach of contract against UMC and its officers and
NICAD and its officers. The case was raffled to the sala
of respondent Judge Rojas, Sr. On March 1, 2002
Judge Roxas issued an order setting a summary
hearing on March 7, 2002 on the propriety of the
issuance of a TRO. But it was only on March 6, 2001
that the NSSC amended its original complaint to
include a prayer for TRO.
Judge Rojas granted TRO against UMC, NICAD
and their respective officers, essentially enjoining UMC
from transacting with NICAD and to stop NICAD from
continuing sell, deal and market motor vehicles and
spare parts of Nissan. NSSC filed an Urgent Motion to
Fix Bond for Plaintiff/Applicant and Approve/Admit
Defendants Counterbond with Prayer to Lift TRO.
Motion was denied.
Judge Rojas later issued a writ of preliminary
injunction after NSSC posted a bond of
P1,000,000.00. UMC filed an Urgent Motion to
Recall/Dissolve Order/Writ of Preliminary Injunction.
Judge Roxas denied the same. UMC then filed with the
CA a Petition for Certiorari and Prohibition assailing the
preliminary injunction issued by Judge Rojas.
In the meantime, NSSC filed with the RTC a
Motion to Enforce Writ of Preliminary Injunction,
whereas UMC, filed a Manifestation and Motion to
Cancel or Hold Proceedings in Abeyance. Judge Rojas
resolved both motions granting NSSCs Motion to
Enforce Writ of Preliminary Injunction.
CA held the trial court committed grave abuse
of discretion in issuing the writ of preliminary
injunction for a period of 20 days without requiring
NSSC to issue any bond at all notwithstanding Rule 58,
Section 4 (b) of the Rules of Court. CA also held that
Judge Rojas committed an irregularity when he issued
an Order setting the application for a TRO for hearing,
notwithstanding the fact that NSSC were not applying
for a TRO in their complaint.
Hence, UMC filed the instant complaint against
Judge Rojas for serious misconduct, gross ignorance of
the law, manifest partiality and grave abuse of
discretion. The Office of the Court Administrator (OCA)
found Judge Rojas guilty of grave abuse of discretion
and recommended a fine with warning that a repetition
of the same or similar acts shall be dealt with more
severely.

Issue: W/N Judge Rojas committed grave abuse of
discretion when he ordered the issuance of the TRO
and the writ of preliminary injuction.

Held and Ratio: Judge Rojas actions constitute grave
abuse of authority.
First, respondent judge ordered a hearing on the
issuance of a TRO although it was not prayed for in the
complaint. SC did not agree with Judge Rojas
argument that the caption and the body of the
complaint showed an intent to include a prayer for a
TRO. Nowhere in the allegations in the complaint was
it shown that great or irreparable injury would result to
NSSC, pending hearing on the preliminary injunction.
Under Section 5, Rule 58 of the 1997 Rules of Civil
Procedure, a TRO may be issued only if it appears
from the facts shown by affidavits or by the
verified application that great or irreparable
injury would result to the applicant before the
writ of preliminary injunction could be heard. In
addition, Section 4(a) of Rule 58 of the Rules of
Court is clear with regard to the procedure to be
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followed in the issuance of writs of preliminary
injunction, i.e., a preliminary injunction or temporary
restraining order may be granted only when the
application in the action or proceeding is verified,
and shows facts entitling the applicant to the
relief demanded. Here, the relief sought by NSSC in
the original complaint consisted mainly of its
reinstatement as dealer of Nissan vehicles and spare
parts in Northern Mindanao, and the termination of the
dealership agreement between UMC and NICAD. NSSC
did not allege facts to support an urgent need to issue
a TRO to prevent any great or irreparable injury that it
might suffer while the preliminary injunction is being
heard.
Second, Judge Rojas issued the TRO without
requiring NSSC to post a bond. Sec. 4, Rule 58 of the
1997 Rules of Civil Procedure states that Unless
exempted by the court, the applicant files with
the court where the action or proceeding is
pending, a bond executed to the party or person
enjoined, in an amount to be fixed by the court,
to the effect that the applicant will pay to such
party or person all damages which he may
sustain by reason of the injunction or temporary
restraining order if the court should finally
decide that the applicant was not entitled
thereto. Upon approval of the requisite bond, a writ
of preliminary injunction shall be issued.
While Section 4(b) of Rule 58 gives the Judge
Rojas the discretion to require a bond before granting
a TRO, the Rules did not intend to give the judge the
license to exercise such discretion arbitrarily to the
prejudice of the defendant. The bond under Rule 58 is
intended to pay all the damages which the party or
person against whom the TRO or injunction is issued
may sustain by reason thereof should the court finally
decide that the applicant was not entitled thereto.
Hence, it follows that unless it appears that the
enjoined party will not suffer any damage, the
presiding judge must require the applicant to post a
bond, otherwise the courts could become instruments
of oppression and harassment.
SC noted that prior to the 1997 Rules of Civil
Procedure, no bond was required for the availment of a
TRO. However, the present Rules now regulate the
issuance of TROs, not only by requiring a hearing, but
also by imposing a bond on the applicant to prevent
the abuse of this relief by litigants.
The TRO issued by Judge Rojas effectively
enjoined UMC and NICAD, from doing business as
dealer of Nissan vehicles in Northern Mindanao. It
does not require deep thinking to realize the losses
that these companies will suffer if the court orders
them to freeze operations. Not only will they be
deprived of potential earnings from sales but they will
also have to expend for their overhead even if they are
not able to do business. Any fair judge would require
the plaintiff in such case to ensure compensation to
the defendant if it is later found that the former is not
entitled to the injunction. Instead Judge Rojas
rejected UMCs motion to fix the NSSCs bond,
although UMC, as defendant therein, had clearly
manifested its willingness to post a counterbond. Such
error on his part is not mere error in judgment. They
were not honest mistakes in the performance of his
duties. There was no urgency or any irreparable injury
which would require the issuance of a TRO and/or
Preliminary Injunction in favor of NSSC. The UMC had
already terminated its dealership agreement with
NSSC as early as October 30, 2001 on clear grounds of
failure to pay its financial obligations, and, thus, the
latter (NSSC) were no longer entitled to avail of the
remedy of injunction as the act to be prevented by the
issuance thereof had long been consummated.


GREENSTAR V. JUDGE ANDIONG

Facts: Greenstar Mangandingan was proclaimed
the Punong Barangay of Basak-Bangco, Madalum,
Lanao del Sur. The losing candidate, Alizaman S.
Sangcopan, on March 3, 2003, filed with the RTC of
Lanao del Sur an action for damages with prayer for
preliminary injunction and/or preliminary mandatory
injunction and temporary restraining order (TRO)
against the seven commissioners of the COMELEC; the
winning and duly proclaimed barangayofficials of
BarangayBasak-Bangco including Greenstar; the Acting
Election Officer; the Board of Election Tellers of
Precinct No. 68A; the Land Bank of the Philippines
(LBP); and the Chief of Barangay Affairs-Department
of Interior and Local Government (DILG), Province of
Lanao del Sur (defendants). Said case was docketed as
Civil Case No. 1912-03.
On March 5, 2003, the Clerk of Court Atty.
Cairoding P. Maruhom issued the summons. Before
these could be served on any of the defendants,
however, Judge Adiong issued a TRO that same day,
without conducting a hearing. He also set the hearing
on the application for the issuance of a preliminary
injunction on March 20, 2003. Greenstar claims that
there is no showing in the records that the case was
raffled to Branch 8 of the RTC presided by Judge
Adiong when said TRO was issued.
T
he sheriff made a
return of service which partly provides that the
defendants were served with summons through Datu
Hassan Mangondaya at his residence in Madalum,
Lanao del Sur.
Greenstar claims that there was no valid
service of summons since Datu Mangondaya had
absolutely nothing to do with the case and was not
even authorized by the court to receive summons for
the defendants.
Six days after issuing the TRO, Judge Adiong,
Greenstar says, without notice or hearing, issued
another order extending the effectivity of the illegally
issued TRO for another twenty (20) days, prior to the
expiration of the TRO's effectivity and in blatant and
open violation of Section 5 of Rule 58 of the Rules of
Court and BP. 224.
On March 20, 2003, Judge Adiong considered
the application for a writ of preliminary injunction
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submitted for resolution. The following day, he granted
Sangcopans application for a writ of preliminary
injunction then issued the writ on March 25, 2003.
Greenstar claims that he only got a copy of the
summons on March 28, 2003.
On April 15, 2003, Greenstar charged Judge
Adiong, with gross ignorance of the law or procedure;
manifest unfaithfulness to a basic legal rule as well as
injudicious conduct; grave abuse of authority; grave
misconduct; conduct prejudicial to the administration
of justice; violation of Rules 3.01 and 3.02 of the Code
of Judicial Conduct; knowingly rendering an unjust
interlocutory order; and bias and partiality.
In a Supplemental Affidavit-Complaint,
Greenstar also charged Maruhom (Clerk of Court) and
Masbod Sybil (Cash Clerk) with dishonesty, grave
misconduct in office, conduct prejudicial to the orderly
administration of justice, and violation of Section 3,
paragraph (e) of Republic Act No. 3019. Greenstar
claims that Maruhom and Sybil conspired with Judge
Adiong and Atty. Edgar Masorong, Sangcopans
counsel, to manipulate the raffle of the case. The case
was raffled to branch 10 but it eventually went to
Adiongs branch 8.
The complaint and supplemental complaint
having been filed directly with the Office of the Court
Administrator (OCA), then Court Administrator directed
Adiong, Maruhom and Sybil to submit their respective
comments.
Judge Adiong argues that the issuance of the
TRO on March 5, 2003 without prior notice and hearing
was valid pursuant to Supreme Court Administrative
Circular No. 20-95, which authorizes the ex
parte issuance of a TRO by an executive judge in
matters of extreme urgency, in order to prevent grave
injustice and irreparable injury. He claims that such
circumstance was clearly obtaining at the time he
issued the TRO. He also claims that when he extended
the TRO to its maximum duration of twenty (20) days
from its issuance, no violation of Section 5 of Rule 58
of the Rules of Court or B.P. Blg. 224 was committed.
The OCA dismissed the case against Maruhom
but found Judge Adiong and Sybil both guilty and fined
them P20,000 each.

Issue: Did Judge Adiong violate Rule 58, Sec. 5?

Held: Yes! Dismissed from the Service!

Ratio: See Rule 58, Sec. 5!
Judge Adiong disregarded Rule 58, sec. 5 of the Rules.
He could not plausibly claim that he issued a 72-hour
TRO under the second paragraph of the rule because,
first, he was not the executive judge. Second, his
order did not state that the TRO was effective for 72
hours only. On the contrary, the defendants were
ordered to desist from releasing the subject funds
"until further orders from this Court." Third, there was
no showing that the order was being issued because of
extreme urgency to justify the issuance of a 72-hour
TRO. Judge Adiong only stated in his order that he was
"[a]cting on the prayer for the issuance of a Writ of
Preliminary Injunction, without finding that the plaintiff
was entitled thereto."
Judge Adiong's violations of the Rules in
issuing the TRO are patent and inexcusable.
This Court already ruled that failure to abide by
Administrative Circular No. 20-95 (amendments to the
Rule which are now part of the provision) constitutes
the offense of grave abuse of authority, misconduct
and conduct prejudicial to the proper administration of
justice. Indeed, a judge is presumed to know this
Circular. Judge Adiong's failure to comply with the
clear provisions on issuing TROs constitutes gross
ignorance and gross inefficiency.
We also agree that the presumptions of good
faith and regularity in the performance of judicial
functions on the part of Judge Adiong were negated by
the circumstances on record. First, there was no
proper notice to the herein complainant and the other
defendants in Civil Case No. 1912-03 that an
application for the issuance of a TRO had been filed.
Second, Judge Adiong did not conduct a summary
hearing before granting the TRO. Third, as will be
discussed hereafter, he contravened the circular on the
raffle of cases. All these systematically deprived
complainant and the other defendants of knowledge of
and participation in the TRO proceedings and ensured
the unchallenged victory of Sangcopan therein. These
three points, taken together, paint a picture of bias or
partiality on the part of Judge Adiong. His acts amount
to gross misconduct constituting violations of the
following provisions of the Code of Judicial Conduct.
The Court also found that there was no proper
substituted service of summons and that Maruhom
committed a violation when he referred the case to
Judge Adiongs Branch 8 without conducting a raffle.
Adiong was dismissed from the service and Sybil and
Maruhom were each suspended for 3 months.


LANDBANK VS. CONTINENTAL WATCHMAN

FACTS: Land Bank of the Philippines (LBP) caused to
be published in the Philippine Daily Inquirer, a
newspaper of general circulation, an Invitation to Pre-
Qualify, inviting reputable securities agencies to pre-
qualify for security guard services in the different LBP
offices, properties and installations nationwide.
Continental Watchman Agency Incorporated (CWAI)
and other security agencies responded to the invitation
and participated in the public bidding.
In a bidding proper held on June 10, 1997, all
the pre-qualified security agencies, CWAI included,
submitted their individual sealed bid proposals to LBPs
Special Committee for the Selection of Security
Agencies (Bid Committee). It submitted a bid for 3
areas: Area I, II, V (all in Luzon). After all the bids
were opened and evaluated, it turned out that CWAI
was the lowest bidder for those 3 areas. CWAI asked
for a reconsideration but was denied by the Bid
Committee.
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CWAI filed with RTC Manila a Petition for Injunction
and Damages with a prayer for a Preliminary
Mandatory Injunction against LBP.
After the hearing, the trial court issued a
Temporary Restraining Order effective for 20 days. At
the same time, it set for hearing CWAIs application for
preliminary injunction on August 22, 1997. Thereafter,
the trial court issued an order directing the issuance of
a writ of preliminary injunction.
On August 27, 1997, LBP filed its Answer with
Special and/or Affirmative Defenses and Compulsory
Counterclaim. On September 2, 1997, a writ of
preliminary injunction was accordingly issued. On
January 12, 1998, the trial court denied LPBs MR of its
order directing the issuance of a writ of preliminary
injunction.
LBP filed with the CA a Petition for Certiorari
and Prohibition with Preliminary Injunction and
Temporary Restraining Order under Rules 58 and 65 of
the 1997 Rules of Civil Procedure alleging that the two
orders of the trial court (August 22, 1997 & January
12, 1998) were issued without jurisdiction or with
grave abuse of discretion. The CA dismissed the
petition ruling that the grant or denial of an injunction
rests on the sound discretion of the trial court, and will
not be interfered except on a clear abuse of discretion
which is wanting in the this case since the trial court
even conducted hearings before issuing a writ of
preliminary injunction.

ISSUE: WON the CA committed grave abuse of
discretion in dismissing the petition??? NO.
[Note: LBP submits that the CA, by dismissing its
petition, in effect compelled it to enter into a contract
for security guard services with CWAI, and as a result,
the case was prematurely resolved.]

RULING: LBP's remedy is an appeal to the SC from
the CAs decision by way of a Petition for Review on
Certiorari under Rule 45. Instead, it filed the Petition
for Certiorari under Rule 65 43 days after it received
the CAs decision denying its MR. Apparently, LBP
resorted to certiorari because it failed to interpose an
appeal seasonably. This, of course, is a procedural
flaw. Time and again, the SC has reminded members
of the bench and bar that the special civil action of
certiorari cannot be used as a substitute for a lost
appeal.
Admittedly, the SC, in accordance with the
liberal spirit pervading the Rules of Court and in the
interest of justice, has the discretion to treat a petition
for certiorari as a petition for review on certiorari
under Rule 45, especially if filed within the
reglementary period for filing a petition for review. In
this case, however, it finds no reason to justify a
liberal application of the Rules.
Even assuming that the present petition is a
proper remedy, still it is dismissible. Based on the
evidence presented by CWAI, the trial court
found that all the requisites for the issuance of an
injunctive writ were present. Although LBP presented
evidence to rebut CWAIs assertions, those will be
better assessed and considered in the trial proper. The
assailed injunctive writ is not a judgment on the merits
of the case, contrary to the submission of LBP, for a
writ of preliminary injunction is generally based solely
on initial and incomplete evidence. The evidence
submitted during the hearing of the incident is not
conclusive or complete for only a "sampling" is needed
to give the trial court an idea of the justification for the
preliminary injunction pending the decision of the case
on the merits. As such, the findings of fact and opinion
of a court when issuing the writ of preliminary
injunction are interlocutory in nature and made before
the trial on the merits is commenced or terminated.
Furthermore, it does not necessarily proceed that
when a writ of preliminary injunction is issued, a final
injunction will follow, as erroneously argued by LBP.
There are vital facts that have yet to be presented
during the trial which may not be obtained or
presented during the hearing on the application for the
injunctive writ. Clearly, petitioner's contention that the
trial court and the CA had already disposed of the main
case lacks merit.
Also, the sole object of a preliminary injunction
is to preserve the status quo until the merits of the
case can be heard.

Here, after evaluating the evidence
presented by both contending parties, the trial court
held that justice would be better served if the status
quo is preserved until the final determination of the
merits of the case. The SC finds nothing whimsical,
arbitrary, or capricious in such ruling.
Significantly, the rule is well-entrenched that
the issuance of the writ of preliminary injunction rests
upon the sound discretion of the trial court. It bears
reiterating that Section 4 of Rule 58 gives generous
latitude to the trial courts in this regard for the reason
that conflicting claims in an application for a
provisional writ more often than not involve a factual
determination which is not the function of the appellate
courts. Hence, the exercise of sound judicial discretion
by the trial court in injunctive matters must not be
interfered with except when there is manifest abuse,

which is wanting in the present case.


BACOLOD CITY WATER DISTRICT, petitioner, vs.
THE HON. EMMA C. LABAYEN, Presiding Judge,
RTC of Bacolod City, Br. 46 and the City of
Bacolod, respondents.

FACTS. Bacolod City filed a case for Injunction With a
Prayer for Temporary Restraining Order And/Or
Preliminary Mandatory Injunction against Bacolod
City Water District (BACIWA). The petition stated that
on January 15, 1999, BACIWA published in a local
paper of general circulation, a Schedule of Automatic
Water Rates Adjustments for the years 1999, 2000 and
2001. The rates were supposed to take effect 7 days
after its posting in the local papers or on January 22,
1999. The increase was aborted after BACIWA
unilaterally suspended the January 22, 1999 scheduled
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implementation. On March 15, 1999, however, it
announced that the rate hike will be implemented on
April 1, 1999. Bacolod City opposed and prayed that
before the hearing of the main case, a TRO or a
preliminary injunction be issued.
On June 17, 1999, respondent City filed a Motion to
Set [for] Hearing its application for a TRO or
preliminary mandatory injunction. BACIWA opposed
the Motion. Respondent City filed its Reply to
Opposition and reiterated that the application for the
issuance of a temporary restraining order or
preliminary mandatory injunction be heard. On the
same date, BACIWA filed a Manifestation and Motion
stating that the hearing may no longer be necessary as
the respective positions of both parties have already
been presented and amplified in their pleadings and
memoranda.
After a hiatus of nearly seven (7) months, or on
February 18, 2000, respondent City filed an Urgent
Motion for the Issuance of TRO And[/]Or Writ of
Preliminary Injunction praying that the case be set for
hearing on February 24, 2000. On the same date
requested, respondent court heard respondents
application for TRO and issued an Order
commanding petitioner to stop, desist and refrain
from implementing the proposed water rates.
BACIWA filed an Urgent MR and Dissolution of
the TRO. Respondent City filed its Opposition On April
6, 2000, respondent court issued an Order finding
petitioners Urgent MR and Dissolution of TRO moot
and academic considering BACIWAs compliance of said
TRO. On April 19, 2000, respondent City filed a
Manifestation praying that respondent trial court issue
a writ of preliminary injunction against petitioner,
stating that the TRO issued expired before the parties
were able to finish the presentation of their respective
witnesses and evidences. On December 21, 2000,
respondent court issued the assailed Decision granting
the final injunction which allegedly confirmed the
previous preliminary injunction.
Petitioner filed its MR of the assailed Decision
on January 11, 2001. RTC denied the MR for lack of
merit in an Order. Petitioner then filed a special civil
action for certiorari under Rule 65 in the Court of
Appeals. The CA dismissed the petition for review on
certiorari ratiocinating that in the case at bar, the
[O]rder of public respondent dated 24 February
2000, though termed by BACIWA as a temporary
restraining order, is in fact a preliminary
injunction. It must be further noted that the
temporary restraining order has been elevated to
the same level as the preliminary injunction in
the procedure, grounds and requirements of its
obtention by S[ection] 4, Rule 58. Thus, to set [a]
distinction, the present practice is to categorically refer
to it as a temporary restraining order. In which case,
the omission by the public respondent in referring to
the 24 February 2000 order as a temporary restraining
order could not have been a mere oversight but
deliberate.

ISUUE. Whether a preliminary injunction had been
issued. NO.

RATIO. The sequence of events and the proceedings
that transpired in the trial court make a clear
conclusion that the Order issued was a temporary
restraining order and not a preliminary injunction.
First, the trial court has always referred to its
Order as a temporary restraining order in the
succeeding Orders it issued on March 10, 2000 and
April 6, 2000. The parties, in their succeeding
pleadings, also referred to the assailed Order as a
temporary restraining order.
Second. Injunction is a judicial writ, process
or proceeding whereby a party is ordered to do or
refrain from doing a certain act. It may be the main
action or merely a provisional remedy for and as an
incident in the main action. The main action for
injunction is distinct from the provisional or
ancillary remedy of preliminary injunction which
cannot exist except only as part or an incident of an
independent action or proceeding. As a matter of
course, in an action for injunction, the auxiliary
remedy of preliminary injunction, whether prohibitory
or mandatory, may issue. Under the law, the main
action for injunction seeks a judgment embodying a
final injunction which is distinct from, and should not
be confused with, the provisional remedy of
preliminary injunction, the sole object of which is to
preserve the status quo until the merits can be heard.
A preliminary injunction is granted at any stage of an
action or proceeding prior to the judgment or final
order. It persists until it is dissolved or until the
termination of the action without the court issuing a
final injunction.
A restraining order, on the other hand, is
issued to preserve the status quo until the hearing
of the application for preliminary injunction which
cannot be issued ex parte. Under Rule 58 of the Rules
of Court, a judge may issue a temporary restraining
order with a limited life of twenty (20) days from date
of issue. If before the expiration of the twenty (20)-
day period the application for preliminary injunction is
denied, the temporary restraining order would be
deemed automatically vacated. If no action is taken
by the judge on the application for preliminary
injunction within the said twenty (20) days, the
temporary restraining order would automatically
expire on the 20th day by the sheer force of law, no
judicial declaration to that effect being necessary.
In the case at bar, since no preliminary
injunction was issued, the temporary restraining
order granted automatically expired after twenty
(20) days under the Rules. The fact that respondent
court merely ordered the respondent[,] its agents,
representatives or any person acting in his behalf to
stop, desist and refrain from implementing in their
billings the new water rate increase which will start on
March 1, 2000 without stating the period for the
restraint does not convert the temporary restraining
order to a preliminary injunction.
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The rule against the non-extendibility of the
twenty (20)-day limited period of effectivity of a
temporary restraining order is absolute if issued by a
regional trial court. The failure of respondent court to
fix a period for the ordered restraint did not lend the
temporary restraining order a breath of semi-
permanence which can only be characteristic of a
preliminary injunction. The twenty (20)-day period
provided by the Rules of Court should be deemed
incorporated in the Order where there is an omission
to do so. It is because of this rule on non-extendibility
that respondent City was prompted to move that
hearings be set for its application of a preliminary
injunction. Respondent City cannot take advantage of
this omission by respondent trial court.

RULE 59: RECEIVERSHIP

CITIBANK VS. CA

Facts: In considering for a loan obtained from Citibank,
private respondent Douglas Anama executed a
promissory note to pay the plaintiff bank the sum of
P418,000.00 in sixty 60 equal successive monthly
installments. To secure payment of the loan, Anama
also constituted a Chattel Mortgage in favor of
petitioner, on various machineries and equipment with
a condition that in case the plaintiff institutes
proceedings for the foreclosure of the mortgage, the
plaintiff shall be entitled to the appointment of a
receiver without a bond. For failure and refusal of
Anama to pay the monthly installment due, Citibank
filed a verified complaint against Anama for the
collection of his unpaid balance and for the delivery
and possession of the chattels covered by the Chattel
Mortgage preparatory to the foreclosure thereof. The
trial court upon proof of default of Anama in the
payment of the said loan, issued an Order of Replevin
over the macheneries and equipment covered by the
Chattel Mortgage. A pre-trial conference was held and
the lower court issued an order for joint management
by Citibank and Anama of the latter's business for ten
(10) days, after which the former would appointed
receiver for the said business. Thus, Citibank took over
private respondent's business as receiver. When
further proposals to settle the case amicably failed, the
lower court proceeded to try the case on the merits.
Citibank presented a Motion for the Issuance of
an Alias Writ of Seizure which the trial court issued.
Anama moved for reconsideration of the aforesaid
order but the same was denied. As a consequence, the
sheriff seized subject properties, dismantled and
removed them from the premises where they were
installed, delivered them to Citibanks possession and
advertised them for sale at public auction. Anama filed
with the CA a Petition for Certiorari and
Prohibition with Injunction to set aside and annul the
questioned resolution of the trial court. CA granted
petition, holding that the provision of the Rules of
Court on Replevin and Receivership have not been
complied with, in that (1) there was no Affidavit of
Merit accompanying the Complaint for Replevin; (2)
the bond posted by Citibank was insufficient; and (3)
there was non-compliance with the requirement of a
receiver's bond and oath of office.

Issue: (with regard to receivership) WON there was
non-compliance on the part of Citibank of posting a
receivers bond No! WON there was non-compliance
as to the oath of office? YES!

Ratio: Citibank contends that although it is in
agreement with the CA that a receiver's bond is
separate and distinct from a replevin bond, under the
circumstances it was not required to file a receiver's
bond because it did not assume receivership over the
properties. It is further argued that assuming that it
did assume receivership, the Chattel Mortgage
expressly provides, that in case the MORTGAGEE
institutes proceedings, the MORTGAGEE shall be
entitled as a matter of right to the appointment of a
receiver, without bond, of the mortgaged properties
and of such properties, real or personal, claims and
rights of the MORTGAGOR as shall be necessary or
proper to enable the said receiver to property control
and dispose of the mortgaged properties.
From the evidence on record, it is palpably
clear that petitioner Citibank did, in fact, assume
receivership. The CA found that the requirements of
Section 5, Rule 59 on receivership were not complied
with by the petitioner, particularly the filing or posting
of a bond and the taking of an oath. It should be noted
that under the old Rules of Court which was in effect at
the time this case was still at trial stage, a bond for the
appointment of a receiver was not generally required
of the applicant, except when the application was ex
parte. Therefore, petitioner was not absolutely
required to file a bond. Besides, as stipulated in the
chattel mortgage contract between the parties,
petitioner, as the mortgagee, is entitled to the
appointment of a receiver without a bond.
However, the Court of Appeals was right in
finding a defect in such assumption of receiver in that
the requirement of taking an oath has not been
complied with Section 5, Rule 59, states:
Sec. 5. Oath and bond of receiver. Before
entering upon his duties, the receiver must be
sworn to perform them faithfully, and must file
a bond, executed to such person and in such
sum as the court or judge may direct, to the
effect that he will faithfully discharge the
duties of receiver in the action and obey the
orders of the court therein.
Consequently, the trail court erred in allowing
the petitioner to assume receivership over the machine
shop of private respondent without requiring the
appointed receiver to take an oath.


REPUBLIC OF THE PHILIPPINES VS HON.
BERNARDO SALUDARES AND HUNG MING KUK
(receivership was barely discussed)
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Facts: PCGG issued a writ of sequestration directed
towards the Lianga Bay Logging Company (LBLC). The
writ of sequestration was based on the ground that the
shares of stock of LBLC owned by Peter Sabido formed
part of illegally acquired wealth. Sabido then filed a
motion to lift the writs of sequestration before the
sandiganbayan which was granted. PCGG filed an MR
which was denied. They then filed the special civil
action of certiorari to contest said order.
In the meantime, private respondent Hung
Ming Kuk filed a complaint for sum of money against
LBLC with a prayer for preliminary attachment. PCGG
was not impleaded nor was the sequestration
proceeding referred to. Trial court granted the writ of
preliminary attachment. Theraefer, Hung Ming Kuk
filed a motion to declare LBLC in default for failure to
file responsive pleadings. RTC declared LBLC in default
and rendered judgment in favor of Hung Ming Kuk.
SC, in relation to the sequestration
proceedings, reversed the sandiganbayans decision
and affirmed the validity of the writ of sequestration.
Entry of judgment was issued.
Republic thus now contends that the RTC
cannot attach the properties because the writ of
sequestration is valid. (Basically, at issue is that the
same properties of LBLC is the subject of both the
attachment and the sequestration order)

Issue: Whether attachment was valid considering the
properties were already under sequestration? NO

Held: 1
st
issue was actually who had jurisdiction- RTC
or Sandiganbayan? SC said that the fact of
sequestration alone did not automatically oust the RTC
of jurisdiction. PCGG must be a party to the suit in
order that the sandiganbayans exclusive jurisdiction
may be correctly invoked. In this case, the claim of
Hung Ming Kuk arose from a debt incurred by LBLC.
Hung Ming Kuk extended cash advances and supplied
parts and materials to LBLC. Being a claim for a sum of
money, the complaint falls within the jurisdiction of the
RTC.
This case concerns receivables of Hung Ming
Kuk arising out of a legitimate business contract to
supply goods and services in favor of LBLC. When a
collection suit was filed against LBLC by Hung Ming
Kuk, evidently PCGG could not be the proper party to
defend against such claim. More so, because when
PCGG had not taken over the LBLC's business
operations.
Part where receivership was mentioned: Recall
that the SC declared the writ of sequestration valid.
That resolution said, the devices the revolutionary
government provided for the recovery of ill gotten
wealth took the form of provisional remedies similar
to... receivership. The court noted the relationship
between attachment and receivership on one hand,
and sequestration, freeze order and provisional
takeover on the other. SC said the latter are ancillary
remedies in prosecuting the ill gotten wealth of the
Marcoses and are similar to the former.
(No more mention of receivership. SC
discussed preliminary attachment instead)
By an order of attachment, a sheriff seizes
property of a defendant in a civil suit so that it may
stand as security for the satisfaction of any judgment
that may be obtained. When a writ of attachment has
been levied on real property or any interest therein
belonging to the judgment debtor, the levy creates a
lien which nothing can destroy but its dissolution. This
well-settled rule is likewise applicable to a writ of
sequestration.
Attachment is in the nature of a proceeding in
rem. It is against a particular property of a debtor. The
attaching creditor thereby acquires a specific lien upon
the attached property which ripens into a judgment
against the res when the order of sale is made. Such a
proceeding is in effect a finding that the property
attached is an indebted thing and results in its virtual
condemnation to pay for the owner's debt. The law
does not provide the length of time during which an
attachment lien shall continue after the rendition of the
judgment, and it must therefore continue until the
debt is paid, or sale is had under execution issued in
the judgment, or until the judgment is satisfied, or the
statement discharged or vacated in some manner
provided by law.
In this case, the disputed properties of LBLC
were already under custodial egis by virtue of a valid
writ of sequestration when Judge Saludares issued the
writ of attachment. The writ of sequestration
subsisting, it could not be interfered with by the RTC
since the PCGG is a coordinate and co-equal body.

RULE 60: REPLEVIN

TWIN ACE HOLDINGS CORPORATION VS. RUFINA
AND COMPANY

FACTS: Twin Ace Holdings Corporation (Twin Ace;
petitioner) filed a complaint for recovery of possession
of personal property, permanent injunction and
damages with prayer for the issuance of a writ of
replevin, TRO and a writ of preliminary injunction
against Rufina and Company (Rufina; respondent).
Twin Ace is a private domestic corporation
engaged in the manufacture of rhum, wines, and liquor
under the name and style Tanduay Distillers. It has
registered its mark of ownership of its bottles with the
Bureau of Patent, Trademarks and Technology Transfer
under RA 623 (An Act to Regulate the Use of Duly
Stamped or Marked Bottles, Boxes, Casks, Kegs,
Barrels and Other Similar Containers). It makes
substantial investments in brand new bottles which it
buys from glass factories and use the bottles for 5
times in order to recover the cost of acquisition. Twin
Ace sells its products to the public excluding the
bottles and thus retrieves its used empty bottles,
washes and uses them over and over again as
containers.
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Rufina is engaged, among others, in the
production, extraction, fermentation and manufacture
of patis and other food seasonings. In producing patis
and other food seasonings, Rufina uses as containers
bottles owned by Twin Ace without any authority or
permission from the latter. Hence, Rufina is unduly
benefited from the use of the bottles.
In its Answer with counter-application for a
Writ of Preliminary Injunction, Rufina claimed that the
marked bottles it used as containers were purchased
from junk dealers; hence, it became the owner
thereof.
TC dismissed the complaint. Twin Ace appealed
to the CA which affirmed decision of TC. MR filed by
Twin Ace was likewise denied by CA. Hence, this
Petition for Review.

ISSUES:
1. WON the CA erred in holding that Rufina is not
covered within the exemption provided by Sec. 6 of RA
623, as amended by RA 5700
2. WON the CA erred in not finding that Twin Ace as
owner of the bottles is entitled to compensation for its
unauthorized use by Rufina (as stated in the case but I
think the proper issue is WON Twin Ace has shown that
it is entitled to the possession of the bottles for it to be
issued a Writ of Replevin)

HELD:
1. NO. Basically, RA 623, as amended by 5700 makes
it unlawful for any person to use the marked bottles
without permission from its owner. However, such Act
provided an exemption:

Sec. 6. The provisions of this Act shall not be
interpreted as prohibiting the use of bottles as
containers for "sisi," "bagoong," "patis," and
similar native products. (this is the exemption Twin
Ace is referring to)

Twin Ace asserts that the provision under the
law affords protection only to small scale
producers/manufacturers who do not have the capacity
to buy new bottles for use in their products and cannot
extend to Rufina which had admitted in its Answer and
affirmed in the TC decision that it is engaged on a
large scale basis. Rufina counters that the law did not
really distinguish between large scale manufacturers
and small time producers.
The earlier case of Twin Ace Holdings
Corporation v. Court of Appeals, applies to the present
petition. In said case, Twin Ace filed a Complaint for
Replevin against Lorenzana Food Corporation to
recover 380 bottles allegedly owned by Twin Ace but
detained and used by Lorenzana Food Corporation as
containers for its native products without its express
permission, in violation of the law. In that case, this
Court acknowledged that the exemption under the law
is unqualified as the law did not make a distinction that
it only applies to small scale industries but not to large
scale manufacturers. Thus, even if the court in said
case held that the exemption is primarily meant to
give protection to small scale industries, it did not
qualify that the protection therein was intended and
limited only to such.
It is worth noting that Lorenzana Food
Corporation which prevailed in the case filed by Twin
Ace against it is certainly not a small scale industry.
Just like Rufina, Lorenzana Food Corporation also
manufactures and exports processed foods and other
related products, e.g., patis, toyo, bagoong, vinegar
and other food seasonings.
In view of these considerations, we find and so
hold that the exemption contained in Section 6 of Rep.
Act No. 623 applies to all manufacturers of sisi,
bagoong, patis and similar native products without
distinction or qualification as to whether they are
small, medium or large scale.

2. NO. Rule 60, Section 2(a), of the Revised ROC
mandates that a party praying for the recovery of
possession of personal property must show by his own
affidavit or that of some other person who personally
knows the facts that he is the owner of the property
claimed, particularly describing it, or is entitled to the
possession thereof.

It must be borne in mind that
replevin is a possessory action the gist of which
focuses on the right of possession that, in turn, is
dependent on a legal basis that, not infrequently, looks
to the ownership of the object sought to be
replevied. Wrongful detention by the defendant of the
properties sought in an action for replevin must be
satisfactorily established. If only a mechanistic
averment thereof is offered, the writ should not be
issued.
In this case, Twin Ace has not shown that it is
entitled to the possession of the bottles in question
and consequently there is thus no basis for the
demand by it of due compensation.


SUPERLINES V. PNCC

FACTS: A Superlines bus swerved and crashed into the
radio room of PNCC while the bus was traveling north
and approaching the Alabang northbound exit lane.
During the investigation, the bus was turned over to
the Alabang Traffic Bureau for it to conduct its own
investigation of the incident. Because of lack of
adequate space, the bus was, on request of traffic
investigator Lopera, towed by the PNCC patrol to its
compound where it was stored.
Superlines requested PNCC to release the bus
but it refused despite the willingness of the former to
repair the damaged radio room. PNCC demanded the
sum of P40K for repair although Superlines estimate
for the repair of the radio room was only P10K.
Because of the refusal, Superlines filed a complaint for
replevin with damages.
The Lower Court sided with Superlines but
since Superlines is unable to put op the bond for the
issuance of the writ of replevin, it opted to forego the
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same and just wait for the courts final judgment.
Lower Court dismissed Superlines complaint
and granted PNCCs counterclaim and ordered
Superlines to pay P40K in damages. CA affirmed: the
storage of the bus for safekeeping purposes partakes
of the nature of a deposit, hence, custody or authority
over it remained with Lopera who ordered its
safekeeping.

Issue: Whether or not the bus should be released? YES

SC: In a complaint for replevin, the claimant must
convincingly show that he is either the owner or clearly
entitled to the possession of the object sought to be
recovered, and that the defendant, who is in actual or
legal possession thereof, wrongfully detains the same.
Superlines ownership of the bus being
admitted by PNCC, consideration of whether
respondents have been wrongfully detaining it is in
order.
Following the conduct of an investigation of the
accident, the bus was towed by PNCC on the request of
Lopera. It was thus not distrained or taken for a tax
assessment or a fine pursuant to law, or seized under
a writ of execution or preliminary attachment, or
otherwise placed under custodia legis.
In upholding the dismissal of Superlines
complaint, the CA held that while there is no law
authorizing the impounding of a vehicle involved in an
accident by the police authorities, neither is there a
law making the impounding of vehicles involved in
accidents illegal. It added that SC is of the view that
there is yet no clear-cut policy or rule on the matter.
The CA is mistaken. The Constitution grants the right
against unreasonable seizures.
The CAs reliance on Victory Liner v. Bellosillo to justify
the impounding of vehicles involved in accidents by
police authorities is misplaced. The Victory Liner case
was an administrative case against a trial court judge.
This Court explicitly declined to rule on the legality of
such an order:
It held that this administrative case is not the right
forum to determine the issue of the legality of
respondents order requiring VLI to post a cash bond
for the release of its impounded vehicle. VLI should
have raised that issue in the proper courts and not
directly to us, and much less by way of an
administrative case.
SCs statement in Victory Liner on the lack of a
"clear-cut policy" refers to the practice, rightly or
wrongly, of trial court judges of issuing orders for the
impounding of vehicles involved in accidents. It has no
application to the instant case which involves the
seizure and distraint implemented by respondents
upon a verbal order by Lopera without the benefit or
color of legality afforded by a court process, writ or
order.
It is true that property held as evidence in a criminal
case cannot be replevied. But the rule applies only
where the property is lawfully held, that is, seized in
accordance with the rule against warrantless searches
and seizures or its accepted exceptions. Property
subject of litigation is not by that fact alone in custodia
legis. A thing is in custodia legis when it is shown that
it has been and is subjected to the official custody of a
judicial executive officer in pursuance of his execution
of a legal writ. Only when property is lawfully taken by
virtue of legal process is it considered in the custody of
the law, and not otherwise.


LT. GEN. ALFONSO DAGUDAG V. JUDGE
PADERANGA

FACTS: Dagudag is the head of Task Force Sagip
Kalikasan of the DENR. The PNP regional maritime
group of region 7 received information that a vessel of
NMC Container Lines, Inc. was shipping container vans
containing illegal forest products from CDO to Cebu.
The shipments were falsely declared as cassava meal
and corn grains to avoid inspection. A team of PNP,
DENR and Phil Coast Guard members inspected the
container vans in Mandaue port. The crew of the vessel
failed to produce documents for the forest products.
Since nobody claimed the forest products
within a reasonable period, DENR considered them as
abandoned and a seizure receipt was issued to NMC
Container Lines. DENR then posted notices informing
the unknown owner/s of the goods that an admin
adjudication was to be held. During the adjudication,
no one appeared, so it was recommended that the
goods be confiscated in favor of the govt.
Out of nowhere, a certain Roger Edma filed a
complaint before Judge Paderanga praying that a writ
of replevin be issued to order DENR, Dagudag et al. to
deliver the forest products to him. Judge issued the
writ.
DENR et al. then filed a motion to quash the
writ of replevin because Edmas bond was insufficient;
forest products were falsely declared; Edma was not a
party-in-interest; the forest products were
undocumented; they were considered abandoned
already; replevin was not the proper remedy; the
products were lawfully seized under the Revised
Forestry Code; court could not have taken cognizance
of the case because it was pending with DENR and
Edma failed to exhaust his admin remedies. In a
motion to dismiss, they also alleged that the real
defendant is the Republic and that the state cannot be
sued without its consent. Judge denied DENR et al.s
motion for lack of merit.
Dagudag then filed with the Office of Court
Admin a complaint charging Paderanga with gross
ignorance of the law and conduct unbecoming of a
judge.

Issue: was it proper for the judge to take cognizance
of the replevin suit and to issue the writ of replevin?
No. denial of the motion to quash demonstrates
ignorance of the law.

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Ruling: The OCA recommended that that Judge
Paderanga be held liable for gross ignorance of the law
for the ff reasons:

(1) violation the doctrine of exhaustion of
administrative remedies.

Courts should not entertain suits unless the available
administrative remedies have first been resorted to.
Before a party is allowed to seek the intervention of
the court, it is a pre-condition that he should have
availed of all the means of administrative processes
afforded him. The premature invocation of court's
intervention is fatal to one's cause of action. Edma did
not resort to, or avail of, any administrative remedy.
He went straight to court and filed a complaint for
replevin and damages. PD 705 states that all actions
and decisions of the Bureau of Forest Development
Director are subject to review by the DENR Secretary;
(2) the decisions of the DENR Secretary are appealable
to the President; and (3) courts cannot review the
decisions of the DENR Secretary except through a
special civil action for certiorari or prohibition.

(2) Under the doctrine of primary jurisdiction,
courts cannot take cognizance of cases
pending before administrative agencies of
special competence.

The DENR is the agency responsible for the
enforcement of forestry laws. The complaint for
replevin itself stated that members of DENR's Task
Force Sagip Kalikasan took over the forest products
and brought them to the DENR Community
Environment and Natural Resources Office. This should
have alerted Judge Paderanga that the DENR had
custody of the forest products, that administrative
proceedings may have been commenced, and that the
replevin suit had to be dismissed outright.

(3) Third, the forest products are already
in custodia legis and thus cannot be the subject of
replevin.

There was a violation of the Revised Forestry Code and
the DENR seized the forest products in accordance with
law. Properties lawfully seized by the DENR
cannot be the subject of replevin. Since there was
a violation of the Revised Forestry Code and the
seizure was in accordance with law, the properties
seized were validly deemed in custodia legis.
They could not be subject to an action for
replevin for it is property lawfully taken by virtue
of legal process. Under the Revised Forestry Code,
the DENR secretary or his authorized representatives
may order the confiscation of forest products illegally
cut, gathered, removed, or possessed or abandoned.

[Minor issues:
Gross ignorance of law: Failure to follow basic legal
commands constitutes gross ignorance of the law from
which no one may be excused, not even a judge.

Violation of the New Code of Judicial Conduct for the
Philippine Judiciary: judges should keep themselves
abreast with legal developments; gross inefficiency in
failure to consider so basic a rule; using inappropriate
language in court (said things like shut up,
baloney! what kind of a lawyer are you, how dare
you say that the court is wrong the problem with you
people is you dont use your heads]

RULE 61: SUPPORT PENDENTE LITE

MANGONON v. COURT OF APPEALS

FACTS: Petitioner Ma. Belen B. Mangonon filed, in
behalf of her then minor children Rica and Rina, a
Petition for Declaration of Legitimacy and Support,
with application for support pendente lite with the RTC
Makati against the father and grandfather of the said
twins. In said petition, it was alleged that petitioner
and respondent Federico Delgado were civilly married.
As the marriage was solemnized without the required
consent, it was annulled. Within seven months after
the annulment of their marriage, petitioner gave birth
to twins Rica and Rina. According to petitioner, she,
with the assistance of her second husband Danny
Mangonon, raised her twin daughters as private
respondents had totally abandoned them. At the time
of the institution of the petition, Rica and Rina were
about to enter college in the USA where petitioner,
together with her daughters and second husband, had
moved to and finally settled in. Rica was admitted to
the University of Massachusetts (Amherst) while Rina
was accepted by the Long Island University and
Western New England College. Despite their
admissions to said universities, Rica and Rina were,
however, financially incapable of pursuing collegiate
education because, in essence, their money wasnt
enough.
Petitioner filed an Urgent Motion to Set
Application for Support Pendente Lite for Hearing
because Rica and Rina both badly needed immediate
financial resources for their education. This Motion was
opposed by respondent Francisco (the twins
grandfather). The trial court granted the prayer for
support pendente lite.
Not satisfied with the Order of the trial court
(because she felt that the amount was not enough),
petitioner brought the case to the Court of Appeals via
Petition for Certiorari. The Court of Appeals affirmed
the holding of the trial court. The MR was denied as
well.

ISSUE: W/N support pendente lite may be granted?
YES.

HELD: Under this ROC, a court may temporarily grant
support pendente lite prior to the rendition of
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judgment or final order. Because of its provisional
nature, a court does not need to delve fully into the
merits of the case before it can settle an application for
this relief. All that a court is tasked to do is determine
the kind and amount of evidence which may suffice to
enable it to justly resolve the application. It is enough
that the facts be established by affidavits or other
documentary evidence appearing in the record.
After the hearings conducted on this matter as
well as the evidence presented, we find that petitioner
was able to establish, by prima facie proof, the filiation
of her twin daughters to private respondents and the
twins entitlement to support pendente lite. The next
question is who should be made liable for said award.
[NOTE: THIS PART, ONWARDS, IS MORE
CIV LAW THAN REM]The pertinent provision of the
Family Code on this subject states:
ART. 199. Whenever two or more persons are obliged
to give support, the liability shall devolve upon the
following persons in the order herein provided:
(1) The spouse;
(2) The descendants in the nearest degree;
(3) The ascendants in the nearest degree; and
(4) The brothers and sisters.
The obligation to give support rests principally
on those more closely related to the recipient.
However, the more remote relatives may be held to
shoulder the responsibility should the claimant prove
that those who are called upon to provide support do
not have the means to do so.
There being prima facie evidence showing that
petitioner and respondent Federico are the parents of
Rica and Rina, petitioner and respondent Federico are
primarily charged to support their childrens college
education. In view however of their incapacities as
established, the obligation to furnish said support
should be borne by respondent the twins grandfather,
Francisco. Under Article 199 of the Family Code,
respondent Francisco, as the next immediate relative
of Rica and Rina, is tasked to give support to his
granddaughters in default of their parents. The Court
discussed that based on the evidence, Francisco had
ample means to provide support to the twins. It having
been established that respondent Francisco has the
financial means to support his granddaughters
education, he, in lieu of petitioner and respondent
Federico, should be held liable for support pendente
lite.
Meanwhile, Art. 204 states that the obligor is
given the choice as to how he could dispense his
obligation to give support. Thus, he may give the
determined amount of support to the claimant or he
may allow the latter to stay in the family dwelling. The
second option cannot be availed of in case there are
circumstances, legal or moral, which should be
considered. In this case, the Court said that the second
option is not anymore possible due to strained
relations between the family members involved.
As to the amount of support pendente lite: we
hold respondent Francisco liable for half of the amount
of school expenses incurred by Rica and Rina as
support pendente lite. As established by petitioner,
respondent Francisco has the financial resources to pay
this amount given his various business endeavors.
Considering, however, that the twin sisters may have
already been done with their education by the time of
the promulgation of this decision, we deem it proper to
award support pendente lite in arrearsto be computed
from the time they entered college until they had
finished their respective studies.





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RULE 62: INTERPLEADER

OCAMPO V. TIRONA

Facts: Leonardo Ocampo alleged that he was the
owner of a parcel of land in Pasay City and that he
bought it from Rosauro Breton. Possession and
management of the land was already with him despite
the TCT not being issued yet. Leonora Tirona was the
lessee of the land even before Ocampo bought it.
Upon acquisition of ownership by Ocampo, he
sent a formal notice to Tirona. Tirona religiously paid
her rents until the subject premises were declared
under area for priority development. As such, Tirona
invoked her right to first refusal and refused to pay her
rent until the NHA processed her papers.
Ocampo filed a complaint for unlawful detainer
against Tirona. Tironas defense was that Ocampo was
not the owner thus she shouldnt pay him rent. It
should be noted that Tirona kept changing the theory
of her case stating that Lourdes Rodriguez Yaneza
owned the land when the case was at the MTC and
stating that Breton was the owner when the case was
appealed to the RTC.

Issue: Should the complaint for unlawful detainer
prosper? YES.

Decision: First, the issue of ownership is not essential
to an action for unlawful detainer. The fact of the lease
and the expiration of its term are the only elements of
the action. The defense of ownership does not change
the summary nature of the action. The affected party
should raise the issue of ownership in an appropriate
action, because a certificate of title cannot be the
subject of a collateral attack.
In actions for forcible entry and [unlawful]
detainer, the main issue is possession de facto,
independently of any claim of ownership or possession
de jure that either party may set forth in his pleadings,
and an appeal does not operate to change the nature
of the original action.
Furthermore, Tirona was estopped from
denying that Ocampo had possession of the lease
agreement. She paid her rent to him until such
declaration of the area for priority development. The
sale of a leased property places the vendee into the
shoes of the original lessor to whom the lessee bound
himself to pay.
Lastly (and more importantly), Tirona should
have used reasonable diligence in hailing the
contending claimants to court. Tirona need not have
awaited actual institution of a suit by Ocampo against
her before filing a bill of interpleader. An action for
interpleader is proper when the lessee does not know
the person to whom to pay rentals due to conflicting
claims on the property.
The action of interpleader is a remedy whereby
a person who has property whether personal or real, in
his possession, or an obligation to render wholly or
partially, without claiming any right in both, or claims
an interest which in whole or in part is not disputed by
the conflicting claimants, comes to court and asks that
the persons who claim the said property or who
consider themselves entitled to demand compliance
with the obligation, be required to litigate among
themselves, in order to determine finally who is
entitled to one or the other thing.

The remedy is afforded not to protect a person
against a double liability but to protect him against a
double vexation in respect of one liability. When the
court orders that the claimants litigate among
themselves, there arises in reality a new action and
the former are styled interpleaders, and in such a case
the pleading which initiates the action is called a
complaint of interpleader and not a cross-complaint.


MAGLENTE, ET AL VS. PADILLA in her capacity as
Manila RTC Judge, and several private
respondents

Facts: Philippine Realty Corp (PRC) owned a parcel of
land in Intramuros, which it leased to petitioner
Maglente. The lease agreement included a right of first
refusal in favor of Maglente, as well as an agreement
whereby PRC prohibited Maglente from subleasing the
property. Nonetheless, Maglente subleased the
property to the private respondents (madami sila so di
ko na lalagay names). Later on, PRC decided to sell the
property and offered the land to Maglente in
accordance with her ROFR. Maglente, together with her
co-petitioners in this case (di ko na din lalagay yung
names nila kasi madami masyado), as co-buyers,
agreed to buy the property from PRC. However, PRC
received a letter from the private respondents which
expressed their desire to purchase the same property.
PRC filed a complaint for interpleader with the
Manila RTC to determine who between the 2 parties
had the right to purchase the property. The RTC ruled
in favor of the Maglente and her co-petitioners,
ordering PRC to execute a deed of sale. CA affirme