SECOND DIVISION

[G.R. No. 131724. February 28, 2000]

MILLENIUM INDUSTRIAL COMMERCIAL CORPORATION, petitioner, vs.
JACKSON TAN, respondent. Jjjuris
DECISION
MENDOZA, J.:
In December 1994, Millenium Industrial Commercial Corporation,
petitioner herein, executed a Deed of Real Estate Mortgage[1] over
its real property covered by TCT No. 24069 in favor of respondent
Jackson Tan. The mortgage was executed to secure payment of
petitioner's indebtedness to respondent in the amount of P2 million,
without monthly interest, but which, at maturity date on June 10,
1995, was payable in the amount of P4 million.
On November 9, 1995, respondent filed against petitioner a
complaint for foreclosure of mortgage in the Regional Trial Court,
Branch 6, Cebu City. On November 21, 1995, summons and a copy
of the complaint were served upon petitioner through a certain
Lynverd Cinches, described in the sheriff's return, dated November
23, 1995, as "a Draftsman, a person of sufficient age and
(discretion) working therein, he is the highest ranking officer or
Officer-in-Charge of defendant's Corporation, to receive processes
of the Court."[2]
Petitioner moved for the dismissal of the complaint on the ground
that there was no valid service of summons upon it, as a result of
which the trial court did not acquire jurisdiction over it. Petitioner
invoked Rule 14, 13 of the 1964 Rules of Court and contended that
service on Lynverd Cinches, as alleged in the sheriff's return, was
invalid as he is not one of the authorized persons on whom
summons may be served and that, in fact, he was not even its
employee.[3]
Petitioner also sought the dismissal of the complaint against it on
the ground that it had satisfied its obligation to respondent when
the latter opted to be paid in shares of stock under the following
stipulation in the mortgage contract:
That in the remote possibility of failure on the part of the mortgagor
to pay the mortgage obligation and interest in cash, the
MORTGAGEE at his option may demand that payment be made in

the form of shares of stock of Millenium Industrial Commercial

Corporation totaling at least 4,000,000 shares.[4]
Petitioner further prayed for "other reliefs just and equitable under
the premises."[5] Jurismis
On December 15, 1995, the trial court denied petitioner's Motion to
Dismiss. Its order stated:
This refers to the Motion to Dismiss, dated December 4, 1995, by
defendant anchored on the following grounds:
1. That the Court had not acquired jurisdiction over the person of
the defendant corporation because summons was served upon a
person who is not known to or an employee of the defendant
corporation.
2. That the obligation sought to be collected was already paid and
extinguished.
By interposing the second ground, the defendant has availed of an
affirmative defense on the basis of which the Court has to hear and
receive evidence. For the Court to validly decide the said plea of
the defendant it necessarily had to acquire jurisdiction over the
person of the defendant. Thus, defendant is considered to have
then abandoned its first ground and is deemed to have voluntarily
submitted itself to the jurisdiction of the Court. It is a legal truism
that voluntary appearance cures the defect of the summons, if any.
The defendant's filing of the motion to dismiss by pleading therein
the second ground amounts to voluntary appearance and it indeed
cured the defect.
Wherefore, Motion to Dismiss is hereby denied for lack of merit.[6]
Petitioner moved for reconsideration, but its motion was denied by
the trial court in its order, dated January 16, 1996, for failure of
petitioner to raise any new ground. Petitioner then filed a petition
for certiorari in the Court of Appeals, assailing the aforesaid orders
of the trial court.
On September 18, 1997, the Court of Appeals dismissed the
petition.[7] The appellate court ruled that although petitioner
denied Lynverd Cinches' authority to receive summons for it, its
actual receipt of the summons could be inferred from its filing of a
motion to dismiss, hence, the purpose for issuing summons had
been substantially achieved. Moreover, it was held, by including the

affirmative defense that it had already paid its obligation and

praying for other reliefs in its Motion to Dismiss, petitioner
voluntarily submitted to the jurisdiction of the court.[8] Lexjuris
Hence, this petition for review. Petitioner raises the following
issues:
I......WHETHER OR NOT SERVICE OF SUMMONS UPON A MERE
DRAFTSMAN WHO IS NOT ONE OF THOSE UPON WHOM SUMMONS
MAY BE SERVED IN CASE OF A DEFENDANT CORPORATION AS
MENTIONED IN THE RULES IS VALID.
II......WHETHER OR NOT THE INCLUSION OF ANOTHER AFFIRMATIVE
RELIEF IN A MOTION TO DISMISS ABANDONS AND WAIVES THE
GROUND OF LACK OF JURISDICTION OVER THE PERSON OF THE
DEFENDANT THEREIN ALSO PLEADED UNDER PREVAILING LAW AND
JURISPRUDENCE.
III......WHETHER OR NOT THERE IS A LEGAL GROUND TO GRANT
PETITIONERS MOTION TO DISMISS THE COMPLAINT BELOW.
First. Petitioner objects to the application of the doctrine of
substantial compliance in the service of summons for two reasons:
(1) the enumeration of persons on whom service of summons on a
corporation may be effected in Rule 14 13, is exclusive and
mandatory; and (2) even assuming that substantial compliance is
allowed, its alleged actual receipt of the summons is based on an
unfounded speculation because there is nothing in the records to
show that Lynverd Cinches actually turned over the summons to
any of the officers of the corporation.[9] Petitioner contends that it
was able to file a motion to dismiss only because of its timely
discovery of the foreclosure suit against it when it checked the
records of the case in the trial court.
The contention is meritorious.
Summons is the means by which the defendant in a case is notified
of the existence of an action against him and, thereby, the court is
conferred jurisdiction over the person of the defendant.[10] If the
defendant is corporation, Rule 14, 13 requires that service of
summons be made upon the corporations president, manager,
secretary, cashier, agent, or any of its directors.[11] The rationale
of the rule is that service must be made on a representative so
integrated with the corporation sued as to make it a priori
presumable that he will realize his responsibilities and know what
he should do with any legal papers received by him.[12] Esmso

Petitioner contends that the enumeration in Rule 14, 13 is exclusive

and that service of summons upon one who is not enumerated
therein is invalid. This is the general rule.[13] However, it is settled
that substantial compliance by serving summons on persons other
than those mentioned in the above rule may be justified. In G & G
Trading Corporation v. Court of Appeals,[14] we ruled that although
the service of summons was made on a person not enumerated in
Rule 14, 13, if it appears that the summons and complaint were in
fact received by the corporation, there is substantial compliance
with the rule as its purpose has been attained.
In Porac Trucking, Inc. v. Court of Appeals,[15] this Court
enumerated the requisites for the application of the doctrine of
substantial compliance, to wit: (a) there must be actual receipt of
the summons by the person served, i.e., transferring possession of
the copy of the summons from the Sheriff to the person served; (b)
the person served must sign a receipt or the sheriff's return; and (c)
there must be actual receipt of the summons by the corporation
through the person on whom the summons was actually served.
[16] The third requisite is the most important for it is through such
receipt that the purpose of the rule on service of summons is
attained.
In this case, there is no dispute that the first and second requisites
were fulfilled. With respect to the third, the appellate court held
that petitioner's filing of a motion to dismiss the foreclosure suit is
proof that it received the copy of the summons and the complaint.
There is, however, no direct proof of this or that Lynverd Cinches
actually turned over the summons to any of the officers of the
corporation. In contrast, in our cases applying the substantial
compliance rule,[17] there was direct evidence, such as the
admission of the corporation's officers, of receipt of summons by
the corporation through the person upon whom it was actually
served. The question is whether it is allowable to merely infer
actual receipt of summons by the corporation through the person
on whom summons was served. We hold that it cannot be allowed.
For there to be substantial compliance, actual receipt of summons
by the corporation through the person served must be shown.
Where a corporation only learns of the service of summons and the
filing of the complaint against it through some person or means
other than the person actually served, the service of summons
becomes meaningless. This is particularly true in the present case
where there is serious doubt if Lynverd Cinches, the person on
whom service of summons was effected, is in fact an employee of
the corporation. Except for the sheriff's return, there is nothing to

show that Lynverd Cinches was really a draftsman employed by the

corporation. Mse sm

relief that it can properly ask from the trial court is the dismissal of
the complaint against it. Ex sm

Respondent casts doubt on petitioner's claim that it came to know

about the summons and the complaint against it only after it
learned that there was a pending foreclosure of its mortgage. There
is nothing improbable about this claim. Petitioner was in default in
the payment of its loan. It had received demand letters from
respondent. Thus, it had reason to believe that a foreclosure suit
would be filed against it. The appellate court was, therefore, in
error in giving weight to respondent's claims. Receipt by petitioner
of the summons and complaint cannot be inferred from the fact
that it filed a Motion to Dismiss the case.

WHEREFORE, the decision of the Court of Appeals is REVERSED and

the complaint against petitioner is DISMISSED.

Second. We now turn to the issue of jurisdiction by estoppel. Both

the trial court and the Court of Appeals held that by raising the
affirmative defense of payment and by praying for other reliefs in
its Motion to Dismiss, petitioner in effect waived its objection to the
trial court's jurisdiction over it. We think this is error.
Our decision in La Naval Drug Corporation v. Court of Appeals[18]
settled this question. The rule prior to La Naval was that if a
defendant, in a motion to dismiss, alleges grounds for dismissing
the action other than lack of jurisdiction, he would be deemed to
have submitted himself to the jurisdiction of the court.[19] This rule
no longer holds true. Noting that the doctrine of estoppel by
jurisdiction must be unequivocal and intentional, we ruled in La
Naval:
Jurisdiction over the person must be seasonably raised, i.e., that it
is pleaded in a motion to dismiss or by way of an affirmative
defense. Voluntary appearance shall be deemed a waiver of this
defense. The assertion, however, of affirmative defenses shall not
be construed as an estoppel or as a waiver of such defense.[20]
Third. Finally, we turn to the effect of petitioner's prayer for "other
reliefs" in its Motion to Dismiss. In De Midgely v. Fernandos,[21] it
was held that, in a motion to dismiss, the allegation of grounds
other than lack of jurisdiction over the person of the defendant,
including a prayer "for such other reliefs as" may be deemed
"appropriate and proper" amounted to voluntary appearance. This,
however, must be deemed superseded by the ruling in La Naval
that estoppel by jurisdiction must be unequivocal and intentional. It
would be absurd to hold that petitioner unequivocally and
intentionally submitted itself to the jurisdiction of the court by
seeking other reliefs to which it might be entitled when the only

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 184589

June 13, 2013

DEOGENES O. RODRIGUEZ, Petitioner,

vs.
HON. COURT OF APPEALS and PHILIPPINE CHINESE CHARITABLE
ASSOCIATION, INC., Respondents.
DECISION
LEONARDO-DE CASTRO, J.:
This Petition for Certiorari under Rule 65 of the Rules of Court
assails the Decision1 dated May 26, 2008 and Resolution2 dated
September 17, 2008 of the Court of Appeals in CA-G.R. SP No.
101789 for having been rendered with grave abuse of discretion
amounting to lack of jurisdiction. Said Decision and Resolution
reversed and set aside the Orders dated April 10, 20073 and
November 22, 200t of the Regional Trial Court (RTC), Branch 75,
San Mateo, Rizal, in Land Registration (Reg.) Case No. N-5098 (LRC
Rec. No. N-27619).
The Facts are as follows.
On January 29, 1965, Purita Landicho (Landicho) filed before the
Court of First Instance (CFI) of Rizal an Application for Registration
of a piece of land, measuring 125 hectares, located in Barrio Patiis,
San Mateo, Rizal (subject property), which was docketed as Land
Reg. Case No. N-5098.5 On November 16, 1965, the CFI rendered a
Decision6 evaluating the evidence presented by the parties as
follows:
It has been established by the evidence adduced by Landicho that
the parcel of land under consideration was formerly several smaller
parcels owned and possessed by the spouses Felix San Pascual and
Juanita Vertudes, Ignacio Santos and Socorro Santos, Caconto
Cayetano and Verneta Bartolome, Gavino Espiritu and Asuncion
Cruz, and Lucio Manuel and Justina Ramos, all of whom in January
1960, executed instruments of conditional sale of their respective
parcels of land in favor of Landicho, x x x, and on July 20, 1965 all
of them executed jointly a final deed of absolute sale x x x which

superseded the conditional sale. Gavino Espiritu, one of the

vendors, fifty-five years old, farmer, resident of Barrio Geronimo,
Montalban, Rizal, testified that he and his co-vendors have been in
possession of the parcel of land since 1930 and that the possession
of Landicho, together with her predecessors in interest, has been
open, peaceful, continuous and adverse against the whole world in
the concept of an owner. It has also been established that the
parcel of land is within the Alienable or Disposable Block-I of I.C.
Project No. 26 of San Mateo, Rizal, x x x; that the parcel of land is
classified as "montaoso" with an assessed value of P12,560.00
under Tax Dec. No. 7081, x x x, taxes due to which for the current
year had been paid, x x x; and that the same is not mortgaged or
affected by any encumbrance.
The oppositor did not present testimonial evidence but presented
the report of investigation of Land Investigator Pedro R. Feliciano
dated August 23, 1965, x x x which stated substantially that during
the investigation and ocular inspection it has been ascertained that
no public land application is involved and that no reservation is
affected thereby, and therefore, he believed that the opposition
already filed can be withdrawn; x x x, 1st Indorsement dated
August 24, 1965 of the District Land Officer, District No. 7, Bureau
of Lands, to the Director of Lands, recommending that, in view of
said report of investigation, the opposition be withdrawn; and x x x,
office memorandum of the Chief, Records Division, Bureau of Land,
addressed to the Chief, Legal Division, dated September 23, 1965,
to the effect that according to the records, plan Psu-201023 is not
covered by any kind of public land application or patent.
It is therefore clear from the evidence on record that the applicant
is entitled to the benefits provided by Section 48, of C.A. No. 141,
as amended.7
In the end, the CFI decreed:
WHEREFORE, the Court hereby confirms the title of the applicant,
Purita Landicho, of legal age, married to Teodorico Landicho,
Filipino, resident of 74-A South 19th St., Quezon City, to the parcel
of land under consideration and orders the registration thereof in
her name and personal circumstances aforementioned.
The opposition of the Director of Lands is hereby dismissed.
Once this decision becomes final and executory, let the order for
the issuance of the decree issue.8

Upon finality of its Decision dated November 16, 1965, the CFI
issued an Order9 on December 22, 1965 directing the
Commissioner of the Land Registration Commission (LRC) "to
comply with Section 21 of Act No. 2347"10 on the issuance of a
decree and original certificate of title (OCT).
Eventually, on July 11, 1966, Jose D. Santos (Santos), Register of
Deeds (ROD) for the Province of Rizal, issued Transfer Certificate of
Title (TCT) No. 16768111 in Landichos name covering the subject
property. Notably, ROD Santos issued to Landicho a TCT rather than
an OCT for the subject property; and although TCT No. 167681
stated that it was issued pursuant to Decree No. 1480, no other
detail regarding the decree and the original registration of the
subject property was filled out.
The subject property was thereafter sold several times, and as the
old TCTs of the vendors were cancelled, new TCTs were accordingly
issued to the buyers. The sale of the subject property could be
traced from Landicho to Blue Chips Projects, Inc. (BCPI), which
acquired TCT No. 344936 in its own name on November 10, 1971;
then to Winmar Poultry Farm, Inc. (WPFI), TCT No. 425582,
November 5, 1973; and finally, to herein respondent Philippine
Chinese Charitable Association, Inc. (PCCAI), TCT No. 482970, July
15, 1975.12
Meanwhile, A. Doronila Resources Dev., Inc. (ADRDI)13 instituted
Civil Case No. 12044, entitled A. Doronila Resources Dev., Inc. v.
Court of Appeals, which was still pending before the RTC, Branch
167, of Pasig City as of 2008. ADRDI asserted ownership over the
subject property, which was a portion of a bigger tract of land
measuring around 513 hectares, covered by TCT No. 42999, dated
February 20, 1956, in the name of said corporation. This bigger
tract of land was originally registered in the name of Meerkamp Co.
under OCT No. 301, pursuant to Decree No. 1480, GLRO Record No.
2429, issued on November 22, 1906. ADRDI caused the annotation
of a notice of lis pendens (as regards Civil Case No. 12044) on TCT
No. 344936 of BCPI. Subsequently, based on the ruling of this Court
in A. Doronila Resources Dev., Inc. v. Court of Appeals,14 ADRDI
was also able to have its notice of adverse claim over the subject
property annotated on TCT Nos. 344936 and 425582 of BCPI and
WPFI, respectively. ADRDI subsequently transferred the subject
property to Amado Araneta (Araneta) to whom TCT No. 70589 was
issued on March 25, 1983.
On November 14, 1996, Landicho executed a Deed of Absolute
Sales (sic) over the subject property in favor of herein petitioner

Deogenes O. Rodriguez (Rodriguez). Two years later, on June 1,

1998, Landicho died.
Seven years hence, or on May 18, 2005, Rodriguez filed an
Omnibus Motion before the RTC, Branch 75, of San Mateo, Rizal, in
Land Reg. Case No. N-5098. Rodriguez alleged therein that the
Decision dated November 16, 1965 and Order dated December 22,
1965 of the CFI in Land Reg. Case No. N-5098 which confirmed
Landichos title over the subject property has not been executed.
Rodriguez specifically stated that no decree of registration had
been issued by the LRC Commissioner (now the Administrator of
the Land Registration Authority [LRA]) and that no OCT had been
ever issued by the ROD in Landichos name. As
Landichossuccessor-in-interest to the subject property, Rodriguez
prayed that:
a. Upon the filing of the instant motion, the Clerk of Court of the
Regional Trial Court of Pasig City be commanded to transmit to the
Honorable Court the complete records and expediente of LRC No. x
x x N-5098 (LRC Rec. No. N-27619);
b. After hearing, the Honorable Court give due course to the instant
motions and issue an Order as follows:
i. Directing the Administrator of the Land Registration [Authority] to
issue the Decree of Registration, in accordance with the tenor of
the Decision dated November 16, 1965 x x x and the Order dated
December 22, 1965 x x x, in the name of the petitioner [Rodriguez];
ii. Thereafter, ordering the Register of Deeds for Marikina City,
through the Administrator of the Land Registration Administration
as having direct supervisory authority there-over, to issue the
Original Certificate of Title containing the Technical Description as
duly confirmed in the said Decision and Order x x x in the name of
the herein petitioner [Rodriguez].
PETITIONER further prays for such other measures of relief as may
be deemed just and equitable in the premises.15
In the course of the proceedings concerning the aforementioned
Omnibus Motion, Rodriguez himself submitted as his Exhibit "GG"
TCT No. 482970 of PCCAI but alleged that said certificate of title
was fictitious. Thus, the RTC issued on November 3, 2006 a
subpoena commanding PCCAI to appear at the hearing of Land
Reg. Case No. N-5098 set on November 8, 2006 at 9:00 a.m.; to

bring its TCT No. 482970 and Tax Declaration No. SM-02-0229; and
to testify in connection therewith.

Banuvar, 25 SCRA 316; vda. De Barroga vs. Albano, 157 SCRA 131;
Cacho v. Court of Appeals, 269 SCRA 159)

On November 17, 2006, PCCAI filed before the RTC a Verified

Motion for Leave to Intervene in Land Reg. Case No. N-5098. PCCAI
justified its intervention by arguing that it was an indispensable
party in the case, having substantial legal interest therein as the
registered owner of the subject property under TCT No. 482970.
PCCAI likewise pointed out that Rodriguez himself submitted a copy
of TCT No. 482970, only alleging that said certificate was fictitious.
PCCAI averred that Rodriguez maliciously failed to allege in his
Omnibus Motion that TCT No. 482970 remains valid and subsisting,
there being no direct action or final court decree for its
cancellation. Rodriguezs Omnibus Motion constituted a collateral
attack on the title of PCCAI, which is not sanctioned by law and
jurisprudence. Consequently, PCCAI asked the RTC to allow its
intervention in Land Reg. Case No. N-5098 so it could protect its
vested rights and interests over the subject property; to note and
admit its Answer-in-Intervention; and to deny Rodriguezs Omnibus
Motion for utter lack of merit.

Secondly, a more important issue was put to forewhether this

Court may issue a writ of execution directing the Land Registration
Authority (LRA) to issue a decree of registration over the subject
property and the Register of Deeds of the Province of Rizal to issue
an original certificate of title in the name of [Rodriguez].

The RTC favorably acted on Rodriguezs Omnibus Motion in an

Order dated April 10, 2007, reasoning as follows:
Initially, the issue of jurisdiction arose particularly as to whether
this Court may take cognizance of the instant case previously
assigned to the CFI Pasig and, subsequently, rule upon the
Omnibus Motion of [Rodriguez] despite the lapse of more than forty
(40) years after the finality of the Decision of November 16, 1965.
Clearly, this Court has jurisdiction because, as earlier stated, the
proceedings in this Court is merely a continuation of the land
registration proceedings commenced in the CFI Pasig. More
importantly, with the creation of this Court under the provisions of
the Judiciary Reorganization Law, all cases involving properties
within its territorial jurisdiction, specifically in San Mateo, Rizal,
were transferred to this Court (Sec. 44, Batas Pambansa Blg. 129).
Consequently, there is no legal impediment for this Court to
reiterate the Decision dated November 16, 1965 and the Order
dated December 22, 1966 because the Rules on execution of
Judgment pertaining to civil cases are not applicable to this kind of
proceedings. A final and executory judgment in a land registration
case, being merely declaratory in nature, does not prescribe. (Sta.
Ana vs. Menla, 1 SCRA 1294; Heirs of Cristobal Marcos vs. de

Consistency dictates and being a mere continuation of the CFI Pasig

proceedings, this Court can only reiterate the directives in the
Order dated December 22, 196[5]. It cannot, however, issue, as
prayed for, a writ of execution directing the issuance of a decree of
registration and an original certificate of title in the name of
[Rodriguez].
Finally, during the proceedings in this case, this Court was made
aware of the existence of claimants to the subject property.
However, this Court cannot, at this time and in this proceedings,
rule on the legality or illegality of these claims of ownership. It is
best that these claims be ventilated in appropriate proceedings
specifically sought to for this purpose.16 (Underscoring deleted.)
The RTC decreed thus:
WHEREFORE, premises considered, the Order dated December 22,
1966 of the Court of First Instance of Pasig, Branch 6, is hereby
REITERATED. The Land Registration Authority is directed to issue a
decree of registration while the Register of Deeds of the Province of
Rizal is likewise directed to issue an original certificate of title of the
subject property, both in favor and in the name of applicant Purita
Landicho, of legal age, married to Teodorico Landicho, Filipino and a
resident of 74-A South 19th St., Quezon City, after compliance with
issuance requirements and procedures.17
PCCAI filed a Motion for Reconsideration of the aforequoted Order
of the RTC. The RTC resolved both the Motion for Leave to Intervene
with the attached Answer-in-Intervention and Motion for
Reconsideration of PCCAI in another Order dated November 22,
2007. The trial court held:
This Court after receiving evidence that a Decision was rendered in
favor of the applicants spouses Landicho as owner in fee simple of
the subject parcels of land, and that no title was issued pursuant to
the said Decision which has become final and executory even after
an Order to that effect was issued, merely reiterated the said Order

for the implementation of the Decision dated November 16, 1966,

signed by the Hon. Andres Reyes as Judge. In other words,
Intervention would not be allowed after the Decision has become
final and executory. The issue in the instant Petition is the issuance
of a decree of registration and nothing more is being tried.
WHEREFORE, premises considered, the Motion For Leave To
Intervene and the Motion for Reconsideration filed by the PCCAI are
both DENIED.18
The LRA, upon receipt of a copy of the RTC Order dated April 10,
2007, filed a Manifestation dated February 4, 2008 informing the
trial court that it cannot comply with said Order since there were
already two existing titles covering the subject property, i.e., TCT
No. 70589 of Araneta (traced back to OCT No. 301 of Meerkamp
Co.) and TCT No. 482970 of PCCAI (traced back to Landichos TCT
No. 167681); and to issue a decree of registration and OCT in
Landichos name would only further aggravate the problem of
double titling. The LRA also explained that the ROD issued a TCT,
rather than an OCT, to Landicho for the subject property in 1966,
following the Order dated July 7, 1966 of then LRC Commissioner
Antonio H. Noblejas (Noblejas), who took cognizance of the fact
that the subject property, as part of a bigger parcel of land, was
already registered under OCT No. 301 in the name of Meerkamp
Co., pursuant to Decree No. 1480 under GLRO Record No. 2429
issued in 1906. LRC Commissioner Noblejas additionally stated in
his Order that:
The new transfer certificate of title to be issued by virtue hereof is
deemed to have been derived from Transfer Certificate of Title No.
N-1. (Under Decree No. 1480 dated November 22, 1906) which
should be deemed cancelled with respect to the said property and
that the issuance of the same has been effected without the
presentation of the owners duplicate of subsisting certificate of
title.19 (Emphasis deleted.)
At around the same time, PCCAI filed a Petition for Certiorari and
Prohibition before the Court of Appeals, docketed as CA-G.R. SP No.
101789, assailing the Orders dated April 10, 2007 and November
22, 2007 of the RTC for having been issued without or in excess of
jurisdiction and/or with grave abuse of discretion amounting to lack
or excess of jurisdiction. PCCAI acknowledged that it is the
ministerial duty of the RTC to issue a writ of execution for a final
and executory decision/order; however, PCCAI argued that when
subsequent facts and circumstances transpired which renders the
execution of the final and executory decision/order unjust or

inequitable, then the trial court should refrain from issuing a writ of
execution. PCCAI likewise asserted that the RTC, as a land
registration court, did not have the jurisdiction to resolve conflicting
claims of ownership over the subject property. PCCAI lastly
maintained that it was an indispensable party in Land Reg. Case
No. N-5098 and that it should have been allowed by the RTC to
intervene during the hearing of Rodriguezs Omnibus Motion for the
execution of the Decision dated November 16, 1965 and Order
dated December 22, 1965 of the CFI.
The Court of Appeals, in a Decision dated May 26, 2008, found
merit in the Petition of PCCAI. The appellate court gave great
weight and credence to the Manifestation dated February 8, 2008
of the LRA reporting the double titling and conflicting claims over
the subject property. The Court of Appeals held that:
The Land Registration Authority, being the repository of land
registration documents and the administrative agency with the
necessary expertise concerning land registration matters, We
cannot but agree with the above-quoted Manifestation. Moreover,
from the above facts admitted by the parties and the LRA, it cannot
be denied that there are conflicting claims on the ownership of the
property which cannot be passed upon by the lower court as a land
registration court for lack of jurisdiction.20
The Court of Appeals additionally opined that the intervention of
PCCAI in Land Reg. Case No. N-5098 was proper given the
circumstances:
Anent the issue of intervention, in the case of Information
Technology of the Philippines vs. Comelec, G.R. 159139, August 22,
2006, the following doctrine was enunciated, to wit:
"The basic doctrinal rule is that final judgments may no longer be
modified, except only to correct clerical errors or mistakes, or when
the judgment is void, or if supervening events or circumstances
that transpire after the finality of the decision render its execution
unjust and inequitable. In the interest of substantial justice, this
Court has allowed exceptions to this rule. A person who has a legal
interest in the matter in litigation, or in the success of either of the
parties, or an interest against both, or is so situated as to be
adversely affected by a distribution or other disposition of property
in the custody of the court or of an officer thereof, may, with leave
of court, be allowed to intervene in the action."

We are not unmindful that [PCCAI] filed its Intervention when the
decision of the case was already final and executory and during the
execution stage of the case. However, the supervening event which
is the issuance of a decree of registration which was already
implemented and enforced upon the order of the Administrator of
the LRC way back in July 11, 1966 when the LRC issued TCT No.
167861 in the name of Purita Landicho instead of an OCT makes
the said intervention proper and well-taken.
From the foregoing, it appears absurd and senseless that an OCT be
issued in favor of Mr. Rodriguez. Furthermore, it is in the paramount
interest of justice that the assailed orders be not implemented,
[PCCAI] being an indispensable party in the execution and/or
implementation of the said orders. The non-execution of the said
orders will prevent further disarray, confusion and complexity on
the issue of who is or who should be the real owner of the subject
land which is a matter that can be threshed out in a proper case for
quieting of title between adverse claimants.21
Based on the foregoing, the appellate court adjudged:
All told, the assailed orders were issued with grave abuse of
discretion amounting to lack or in excess of jurisdiction.
WHEREFORE, the assailed orders are REVERSED AND SET ASIDE.
Accordingly, [Rodriguez, RTC Presiding Judge Josephine
ZarateFernandez, the LRA Administrator, and Marikina City ROD]
are enjoined to cease and desist from implementing the said orders
pending the outcome of a proper case before an appropriate court
where the issue of ownership of the subject land can be put to
rest.22

THE [COURT OF APPEALS] HAD ABDICATED ITS JURISDICTION TO

RESOLVE DISPUTES ON THE MERE MANIFESTATION OF THE LRA
THAT THERE WERE ISSUES OF OWNERSHIP WHICH HAVE FIRST TO
BE RESOLVED.
B
THE [COURT OF APPEALS] HAS RESOLVED AN ISSUE WHICH WAS
IRRELEVANT AND IMMATERIAL OR HAD OTHERWISE BEEN
RESOLVED.
II
THE [COURT OF APPEALS] HAD COMMITTED GRAVE ABUSE OF
DISCRETION TANTAMOUNT TO LACK OF JURISDICTION IN RULING
THAT THE [PCCAI] HAD LEGAL STANDING TO PREVENT OR SUSPEND
THE OPERATION OF THE LAND REGISTRATION LAWS BY WAY OF THE
ISSUANCE OF THE ORDER DIRECTING THE LAND REGISTRATION
ADMINISTRATOR TO COMPLY WITH THE ORDER DATED DECEMBER
16, 1965.
A
THE [PCCAI] HAD NO RIGHT TO INTERVENE IN LRC NO. N-5098.
B.
THE [PCCAI] CANNOT CLAIM BUYER IN GOOD FAITH STATUS AS ITS
TITLE WAS DEFECTIVE ON ITS FACE.
III

Rodriguez moved for reconsideration of the foregoing Decision but

was denied by the Court of Appeals in a Resolution dated
September 17, 2008.

[RODRIGUEZ] IS ENTITLED TO THE CORRECTIVE AND PREROGATIVE

WRIT OF CERTIORARI TO INSURE THAT THE LAND REGISTRATION
LAWS ARE PROPERLY AND FULLY IMPLEMENTED.23

Aggrieved, Rodriguez sought recourse from this Court through the

present Petition, arguing that:

The instant Petition has no merit.

I
THE [COURT OF APPEALS] HAD ACTED WITHOUT JURISDICTION
WHEN IT RENDERED AN OPEN-ENDED JUDGMENT.
A

At the outset, the Court finds unmeritorious Rodriguezs claim that

the Court of Appeals rendered an open-ended judgment. In the
dispositive portion of its Decision dated May 26, 2008, the Court of
Appeals clearly and categorically "REVERSED AND SET ASIDE" the
Orders dated April 10, 2007 and November 22, 2007 of the RTC in
Land Reg. Case No. N-5098. The cease and desist order of the
appellate court in the second line of the same dispositive portion is
therefore a superfluity. Obviously, by reversing and setting aside

the foregoing Orders, there is nothing more to implement. The

phrase "pending the outcome of a proper case before an
appropriate court where the issue of ownership of the subject land
can be put to rest,"24 does not mean that the very same Orders
which were reversed and set aside by the Court of Appeals could
later on be revived or reinstated; rather it means that the remedies
sought by Rodriguez can be litigated and granted in an appropriate
proceeding by a court with proper jurisdiction.
To clarify matters, it must be stressed that the issue brought before
the Court of Appeals did not involve the question of the ownership.
The appellate court only concerned itself with the proper execution
of the November 16, 1965 Decision in Land Reg. Case No. N-5098
but, due to the intricacy of the matter, was compelled to take
notice of the controversy between Rodriguez and PCCAI, both of
whom trace back their titles to Landicho. In view of these
conflicting claims, Rodriguez now avers that because ROD Santos
issued TCT No. 167681 for the subject property in Landichos name,
the November 16, 1965 Decision in Land Reg. Case No. N-5098 was
not validly implemented since no OCT was issued.25 Corollary to
this, Rodriguez posits that PCCAI is not a buyer in good faith of the
subject property and that the latters TCT No. 482970 is spurious.
PCCAI, on the other hand, insists that the issuance of TCT No.
167681 to Landicho, from which its own TCT No. 482970 may be
traced back, was a valid execution of the said CFI decision.
The LRA, in its Manifestation dated February 4, 2008 filed before
the RTC, explained that a TCT was issued to Landicho because the
subject property, as part of a bigger parcel of land, was already
covered by Decree No. 1480 and OCT No. 301 dated November 22,
1906 in the name of Meerkamp Co. In other words, Landichos TCT
No. 167681 is a derivative of Decree No. 1480 and OCT No. 301 of
Meerkamp Co. which were cancelled to the extent of the subject
property.
Complicating the matter further is the pendency of Civil Case No.
12044 in the RTC, Branch 167, Pasig City. Not only is PCCAI
questioning the right of Rodriguez to the issuance of an OCT
pursuant to the November 16, 1965 Decision and December 22,
1965 Order of the CFI in Land Reg. Case No. N-5098, it is also
defending the validity of TCT No. 482970 (which is a derivative of
TCT No. 167681 issued to Landicho) against Araneta who holds TCT
No. 70589 (which is a derivative of Meerkamp Co.s OCT No. 301).
In view of the foregoing, issuing an OCT covering the subject
property to Rodriguez would give rise to a third certificate of title
over the same property. Such act would only cause more confusion

and complication, rather than the preservation, of the Torrens

system of registration.
The real purpose of the Torrens system is to quiet title to land and
to stop forever any question as to its legality. Once a title is
registered, the owner may rest secure, without the necessity of
waiting in the portals of the court, or sitting on the "mirador su
casa," to avoid the possibility of losing his land. A Torrens title is
generally a conclusive evidence of the ownership of the land
referred to therein. A strong presumption exists that Torrens titles
are regularly issued and that they are valid.26 In this case, PCCAI is
the registered owner of the subject property under TCT No. 482970,
which could be traced back to TCT No. 16781 issued to Landicho.
As between PCCAI and Rodriguez, the former is better entitled to
the protection of the Torrens system. PCCAI can rely on its TCT No.
482970 until the same has been annulled and/or cancelled.
Section 48 of Presidential Decree No. 1529, otherwise known as the
Property Registration Decree, explicitly provides that "a certificate
of title shall not be subject to collateral attack. It cannot be altered,
modified, or cancelled except in a direct proceeding in accordance
with law."
In Decaleng v. Bishop of the Missionary District of the Philippine
Islands of Protestant Episcopal Church in the United States of
America,27 the Court declared that a Torrens title cannot be
attacked collaterally, and the issue on its validity can be raised only
in an action expressly instituted for that purpose. A collateral attack
is made when, in another action to obtain a different relief, the
certificate of title is assailed as an incident in said action.
Land Reg. Case No. N-5098 was an application for registration of
the subject property instituted by Landicho before the CFI, which
was granted by the CFI in its Decision dated November 16, 1965.
Rodriguez, asserting that he was Landichos lawful successor-ininterest, filed an Omnibus
Motion before the RTC in Land Reg. Case No. N-5098 seeking the
issuance of a decree of registration and an OCT in his name for the
subject property pursuant to the said CFI judgment. Rodriguez
acknowledged the existence of TCT No. 482970 of PCCAI for the
same property, but he simply brushed aside said certificate of title
for allegedly being spurious. Still, Rodriguez did not pray that TCT
No. 482970 be declared void and/or cancelled; and even if he did,
the RTC had no jurisdiction to grant such relief in a land registration
case. Rodriguezs Omnibus Motion in Land Reg. Case No. N-5098,

under the circumstances, is a collateral attack on said certificate,

which is proscribed under Section 48 of the Property Registration
Decree.
If Rodriguez wants to have a decree of registration and OCT issued
in his (or even in Landichos name) for the subject property, he
should have directly challenged the validity of the extant TCT No.
482970 of PCCAI for the very same property in an action
specifically instituted for such purpose (i.e., petition for annulment
and/or cancellation of title, petition for quieting of title) and pray
the said certificate of title be annulled or canceled. The proper
court in an appropriate action can try the factual and legal issues
involving the alleged fatal defects in Landichos TCT No. 167681
and/or its derivative TCTs, including TCT No. 482970 of PCCAI; the
legal effects of Landichos sale of the subject property to BCPI (the
predecessor-in-interest of PCCAI) in 1971 and also to Rodriguez in
1996; and the good faith or bad faith of PCCAI, as well as
Rodriguez, in purchasing the subject property. The resolution of
these issues will ultimately be determinative of who between
Rodriguez and PCCAI is the rightful owner of the subject property.
Clearly, the Court of Appeals cannot be faulted for according weight
and credence to the Manifestation dated February 4, 2008 of the
LRA.
The LRA exists for the sole purpose of implementing and protecting
the Torrens system of land titling and registration.28 In particular, it
is tasked with the following functions:
(1) Issue decrees of registration pursuant to final judgments of the
courts in land registration proceedings and cause the issuance by
the Registrars of Land Titles and Deeds of the corresponding
certificates of title;
(2) Be the central repository of records relative to original
registration of lands titled under the Torrens system, including
subdivision and consolidation plans of titled lands; and
(3) Extend assistance to courts in ordinary and cadastral land
registration proceedings and to the other agencies of the
government in the implementation of the land reform program.29
The duty of LRA officials to issue decrees of registration is
ministerial in the sense that they act under the orders of the court
and the decree must be in conformity with the decision of the court
and with the data found in the record. They have no discretion in

the matter. However, if they are in doubt upon any point in relation
to the preparation and issuance of the decree, these officials ought
to seek clarification from the court. They act, in this respect, as
officials of the court and not as administrative officials, and their
act is the act of the court. They are specifically called upon to
"extend assistance to courts in ordinary and cadastral land
registration proceedings."30
In Ramos v. Rodriguez,31 the LRA filed a motion for reconsideration
of the decision and order of the land registration court respectively
granting registration of a parcel of land and directing the issuance
of a decree of registration for the same. According to the LRA, there
was already an existing certificate of title for the property. The land
registration court granted the motion for reconsideration of the LRA
and set aside its earlier decision and order. On appeal, the Court
declared that the land registration court did not commit grave
abuse of discretion in reversing itself because it was merely
following the recommendation of the LRA, which was then acting as
an agent of the court.
In another case, Spouses Laburada v. Land Registration
Authority,32 the Court refused to issue a writ of mandamus
compelling the LRA to issue a decree of registration as ordered by a
land registration court. The Court took into account the LRA report
that the parcels of land were already registered and held:
That the LRA hesitates in issuing a decree of registration is
understandable. Rather than a sign of negligence or nonfeasance in
the performance of its duty, the LRAs reaction is reasonable, even
imperative. Considering the probable duplication of titles over the
same parcel of land, such issuance may contravene the policy and
the purpose, and thereby destroy the integrity, of the Torrens
system of registration.33
The LRA, in this case, filed the Manifestation dated February 4,
2008 to inform the RTC that the subject property is already covered
by two TCTs, both "uncancelled and extant[;]" and for this reason,
the LRA cannot comply with the RTC Order dated April 10, 2007,
directing the issuance of a decree of registration and an OCT for the
same property in Landichos name, as it would "further aggravate
the already existing problem of double titling." In filing said
Manifestation, the LRA was only faithfully pursuing its mandate to
protect the Torrens system and performing its function of extending
assistance to the RTC as regards Land Reg. Case No. N-5098.
Contrary to Rodriguezs assertion, the Court of Appeals did not
abdicate its jurisdiction when it granted the Petition for Certiorari

and Prohibition of PCCAI largely based on the Manifestation of the

LRA, since the LRA filed such a Manifestation as an officer of the
court.
Finally, intervention is governed by Rule 19 of the Rules of Court,
pertinent provisions of which read:
SECTION 1. Who may intervene. A person who has a legal interest
in the matter in litigation, or in the success of either of the parties,
or an interest against both, or is so situated as to be adversely
affected by a distribution or other disposition of property in the
custody of the court or of an officer thereof may, with leave of
court, be allowed to intervene in the action. The court shall
consider whether or not the intervention will unduly delay or
prejudice the adjudication of the rights of the original parties, and
whether or not the intervenors rights may be fully protected in a
separate proceeding.
SECTION 2. Time to intervene. The motion to intervene may be
filed at any time before rendition of judgment by the trial court. A
copy of the pleading-in-intervention shall be attached to the motion
and served on the original parties.
The subject property is presently covered by TCT No. 482970 in the
name of PCCAI.1wphi1 As the registered owner, PCCAI clearly has
a legal interest in the subject property. The issuance of another
certificate of title to Rodriguez will adversely affect PCCAI,
constituting a cloud on its TCT No. 482970.
Although Rule 19 is explicit on the period when a motion to
intervene may be filed, the Court allowed exceptions in several
cases, viz:
This rule, however, is not inflexible. Interventions have been
allowed even beyond the period prescribed in the Rule, when
demanded by the higher interest of justice. Interventions have also
been granted to afford indispensable parties, who have not been
impleaded, the right to be heard even after a decision has been
rendered by the trial court, when the petition for review of the
judgment has already been submitted for decision before the
Supreme Court, and even where the assailed order has already
become final and executory. In Lim v. Pacquing, the motion for
intervention filed by the Republic of the Philippines was allowed by
this Court to avoid grave injustice and injury and to settle once and
for all the substantive issues raised by the parties.

In fine, the allowance or disallowance of a motion for intervention

rests on the sound discretion of the court after consideration of the
appropriate circumstances. We stress again that Rule 19 of the
Rules of Court is a rule of procedure whose object is to make the
powers of the court fully and completely available for justice. Its
purpose is not to hinder or delay, but to facilitate and promote the
administration of justice.34 (Citations omitted.)
The particular circumstances of this case similarly justify the
relaxation of the rules of procedure on intervention. First, the
interests of both PCCAI and Rodriguez in the subject property arose
only after the CFI Decision dated November 16, 1965 in Land Reg.
Case No. N-5098 became final and executory. PCCAI bought the
subject property from WPFI on November 13, 1973 and was issued
TCT No. 482970 for the same on July 15, 1975; while Rodriguez
bought the subject property from Landicho on November 14, 1996.
Second, as previously discussed herein, both PCCAI and Rodriguez
trace their titles back to Landicho. Hence, the intervention of PCCAI
could not unduly delay or prejudice the adjudication of the rights of
Landicho, the original party in Land Reg. Case No. N-5098. Third,
the latest proceedings in Land Reg. Case No. N-5098 involved
Rodriguezs Omnibus Motion, filed before the RTC on May 18, 2005,
in which he prayed for the execution of the November 16, 1965
Decision of the CFI. PCCAI moved to intervene in the case only to
oppose Rodriguezs Omnibus Motion on the ground that the subject
property is already registered in its name under TCT No. 482970,
which originated from Landichos TCT No. 167681. And fourth, after
learning of Rodriguezs Omnibus Motion in Land Reg. Case No. N5098 via the November 3, 2006 subpoena issued by the RTC, PCCAI
was reasonably expected to oppose the same. Such action was the
most opportune and expedient remedy available to PCCAI to
prevent the RTC from ordering the issuance of a decree of
registration and OCT in Rodriguezs name. For this reason, the RTC
should have allowed the intervention of PCCAI.
ACCORDINGLY, the instant Petition is DISMISSED. The Decision
dated May 26, 2008 of the Court of Appeals in CA-G.R. SP No.
101789, reversing and setting aside the Orders dated April 10,
2007 and November 22, 2007 of the Regional Trial Court, Branch 75
of San Mateo, Rizal in Land Reg. Case No. N-5098, is AFFIRMED with
the MODIFICATION deleting the second sentence of the dispositive
portion for being a superfluity.
Costs against petitioner. SO ORDERED.

THIRD DIVISION
[G.R. No. 138739. July 6, 2000]
RADIOWEALTH FINANCE COMPANY, petitioner, vs. Spouses VICENTE
and MA. SUMILANG DEL ROSARIO, respondents.
DECISION
PANGANIBAN, J.:
When a demurrer to evidence granted by a trial court is reversed
on appeal, the reviewing court cannot remand the case for further
proceedings. Rather, it should render judgment on the basis of the
evidence proffered by the plaintiff. Inasmuch as defendants in the
present case admitted the due execution of the Promissory Note
both in their Answer and during the pretrial, the appellate court
should have rendered judgment on the bases of that Note and on
the other pieces of evidence adduced during the trial.
The Case
Before us is a Petition for Review on Certiorari of the December 9,
1997 Decision[1] and the May 3, 1999 Resolution[2] of the Court of
Appeals in CA-GR CV No. 47737. The assailed Decision disposed as
follows:
WHEREFORE, premises considered, the appealed order (dated
November 4, 1994) of the Regional Trial Court (Branch XIV) in the
City of Manila in Civil Case No. 93-66507 is hereby REVERSED and
SET ASIDE. Let the records of this case be remanded to the court a
quo for further proceedings. No pronouncement as to costs.[3]
The assailed Resolution denied the petitioners Partial Motion for
Reconsideration.[4]
The Facts
The facts of this case are undisputed. On March 2, 1991, Spouses
Vicente and Maria Sumilang del Rosario (herein respondents),
jointly and severally executed, signed and delivered in favor of
Radiowealth Finance Company (herein petitioner), a Promissory
Note[5] for P138,948. Pertinent provisions of the Promissory Note
read:

FOR VALUE RECEIVED, on or before the date listed below, I/We

promise to pay jointly and severally Radiowealth Finance Co. or
order the sum of ONE HUNDRED THIRTY EIGHT THOUSAND NINE
HUNDRED FORTY EIGHT Pesos (P138,948.00) without need of notice
or demand, in installments as follows:
P11,579.00 payable for 12 consecutive months starting on ________
19__ until the amount of P11,579.00 is fully paid. Each installment
shall be due every ____ day of each month. A late payment penalty
charge of two and a half (2.5%) percent per month shall be added
to each unpaid installment from due date thereof until fully paid.
xxxxxxxxx
It is hereby 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 as specified above, the total
principal sum then remaining unpaid, together with the agreed late
payment charges thereon, shall at once become due and payable
without need of notice or demand.
xxxxxxxxx
If any amount due on this Note is not paid at its maturity and this
Note is placed in the hands of an attorney or collection agency for
collection, I/We jointly and severally agree to pay, in addition to the
aggregate of the principal amount and interest due, a sum
equivalent to ten (10%) per cent thereof as attorneys and/or
collection fees, in case no legal action is filed, otherwise, the sum
will be equivalent to twenty-five (25%) percent of the amount due
which shall not in any case be less than FIVE HUNDRED PESOS
(P500.00) plus the cost of suit and other litigation expenses and, in
addition, a further sum of ten per cent (10%) of said amount which
in no case shall be less than FIVE HUNDRED PESOS (P500.00), as
and for liquidated damages.[6]
Thereafter, respondents defaulted on the monthly installments.
Despite repeated demands, they failed to pay their obligations
under their Promissory Note.
On June 7, 1993, petitioner filed a Complaint[7] for the collection of
a sum of money before the Regional Trial Court of Manila, Branch
14.[8] During the trial, Jasmer Famatico, the credit and collection
officer of petitioner, presented in evidence the respondents check
payments, the demand letter dated July 12, 1991, the customers
ledger card for the respondents, another demand letter and

Metropolitan Bank dishonor slips. Famatico admitted that he did not

have personal knowledge of the transaction or the execution of any
of these pieces of documentary evidence, which had merely been
endorsed to him.
On July 4, 1994, the trial court issued an Order terminating the
presentation of evidence for the petitioner.[9] Thus, the latter
formally offered its evidence and exhibits and rested its case on
July 5, 1994.
Respondents filed on July 29, 1994 a Demurrer to Evidence[10] for
alleged lack of cause of action. On November 4, 1994, the trial
court dismissed[11] the complaint for failure of petitioner to
substantiate its claims, the evidence it had presented being merely
hearsay.
On appeal, the Court of Appeals (CA) reversed the trial court and
remanded the case for further proceedings.
Hence, this recourse.[12]
Ruling of the Court of Appeals
According to the appellate court, the judicial admissions of
respondents established their indebtedness to the petitioner, on
the grounds that they admitted the due execution of the Promissory
Note, and that their only defense was the absence of an agreement
on when the installment payments were to begin. Indeed, during
the pretrial, they admitted the genuineness not only of the
Promissory Note, but also of the demand letter dated July 12, 1991.
Even if the petitioners witness had no personal knowledge of these
documents, they would still be admissible if the purpose for which
[they are] produced is merely to establish the fact that the
statement or document was in fact made or to show its tenor[,] and
such fact or tenor is of independent relevance.

The petitioner raises this lone issue:

The Honorable Court of Appeals patently erred in ordering the
remand of this case to the trial court instead of rendering judgment
on the basis of petitioners evidence.[13]
For an orderly discussion, we shall divide the issue into two parts:
(a) legal effect of the Demurrer to Evidence, and (b) the date when
the obligation became due and demandable.
The Courts Ruling
The Petition has merit. While the CA correctly reversed the trial
court, it erred in remanding the case "for further proceedings."
Consequences of a Reversal, on Appeal, of a Demurrer to Evidence
Petitioner contends that if a demurrer to evidence is reversed on
appeal, the defendant should be deemed to have waived the right
to present evidence, and the appellate court should render
judgment on the basis of the evidence submitted by the plaintiff. A
remand to the trial court "for further proceedings" would be an
outright defiance of Rule 33, Section 1 of the 1997 Rules of Court.
On the other hand, respondents argue that the petitioner was not
necessarily entitled to its claim, simply on the ground that they lost
their right to present evidence in support of their defense when the
Demurrer to Evidence was reversed on appeal. They stress that the
CA merely found them indebted to petitioner, but was silent on
when their obligation became due and demandable.
The old Rule 35 of the Rules of Court was reworded under Rule 33
of the 1997 Rules, but the consequence on appeal of a demurrer to
evidence was not changed. As amended, the pertinent provision of
Rule 33 reads as follows:

Besides, Articles 19 and 22 of the Civil Code require that every

person must -- in the exercise of rights and in the performance of
duties -- act with justice, give all else their due, and observe
honesty and good faith. Further, the rules on evidence are to be
liberally construed in order to promote their objective and to assist
the parties in obtaining just, speedy and inexpensive determination
of an action.

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 motion is granted but on
appeal the order of dismissal is reversed he shall be deemed to
have waived the right to present evidence.[14]

Issue

Explaining the consequence of a demurrer to evidence, the Court in

Villanueva Transit v. Javellana[15] 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. (Underscoring supplied)
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.[16] The appellate court shall, in
addition, resolve the case and render judgment on the merits,
inasmuch as a demurrer aims to discourage prolonged litigations.
[17]
In the case at bar, the trial court, acting on respondents demurrer
to evidence, dismissed the Complaint on the ground that the
plaintiff had adduced mere hearsay evidence. However, on appeal,
the appellate court reversed the trial court because the

genuineness and the due execution of the disputed pieces of

evidence had in fact been admitted by defendants.
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 the petitioner. While the appellate court correctly
ruled that the documentary evidence submitted by the [petitioner]
should have been allowed and appreciated xxx, and that the
petitioner presented quite a number of documentary exhibits xxx
enumerated in the appealed order,[18] we agree with petitioner
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.
Due and Demandable Obligation
Petitioner claims that respondents are liable for the whole amount
of their debt and the interest thereon, after they defaulted on the
monthly installments.
Respondents, on the other hand, counter that the installments were
not yet due and demandable. Petitioner had allegedly allowed them
to apply their promotion services for its financing business as
payment of the Promissory Note. This was supposedly evidenced by
the blank space left for the date on which the installments should
have commenced.[19] In other words, respondents theorize that
the action for immediate enforcement of their obligation is
premature because its fulfillment is dependent on the sole will of
the debtor. Hence, they consider that the proper court should first
fix a period for payment, pursuant to Articles 1180 and 1197 of the
Civil Code.
This contention is untenable. The act of leaving blank the due date
of the first installment did not necessarily mean that the debtors
were allowed to pay as and when they could. If this was the
intention of the parties, they should have so indicated in the
Promissory Note. However, it did not reflect any such intention.
On the contrary, the Note expressly stipulated that the debt should
be amortized monthly in installments of P11,579 for twelve
consecutive months. While the specific date on which each
installment would be due was left blank, the Note clearly provided
that each installment should be payable each month.
Furthermore, it also provided for an acceleration clause and a late
payment penalty, both of which showed the intention of the parties

that the installments should be paid at a definite date. Had they

intended that the debtors could pay as and when they could, there
would have been no need for these two clauses.
Verily, the contemporaneous and subsequent acts of the parties
manifest their intention and knowledge that the monthly
installments would be due and demandable each month.[20] In this
case, the conclusion that the installments had already became due
and demandable is bolstered by the fact that respondents started
paying installments on the Promissory Note, even if the checks
were dishonored by their drawee bank. We are convinced neither
by their avowals that the obligation had not yet matured nor by
their claim that a period for payment should be fixed by a court.
Convincingly, petitioner has established not only a cause of action
against the respondents, but also a due and demandable
obligation. The obligation of the respondents had matured and they
clearly defaulted when their checks bounced. Per the acceleration
clause, the whole debt became due one month (April 2, 1991) after
the date of the Note because the check representing their first
installment bounced.
As for the disputed documents submitted by the petitioner, the CA
ruling in favor of their admissibility, which was not challenged by
the respondents, stands. A party who did not appeal cannot obtain
affirmative relief other than that granted in the appealed decision.
[21]
It should be stressed that respondents do not contest the amount
of the principal obligation. Their liability as expressly stated in the
Promissory Note and found by the CA is P13[8],948.00[22] which is
payable in twelve (12) installments at P11,579.00 a month for
twelve (12) consecutive months. As correctly found by the CA, the
"ambiguity" in the Promissory Note is clearly attributable to human
error.[23]
Petitioner, in its Complaint, prayed for 14% interest per annum
from May 6, 1993 until fully paid. We disagree. The Note already
stipulated a late payment penalty of 2.5 percent monthly to be
added to each unpaid installment until fully paid. Payment of
interest was not expressly stipulated in the Note. Thus, it should be
deemed included in such penalty.
In addition, the Note also provided that the debtors would be liable
for attorneys fees equivalent to 25 percent of the amount due in
case a legal action was instituted and 10 percent of the same

amount as liquidated damages. Liquidated damages, however,

should no longer be imposed for being unconscionable.[24] Such
damages should also be deemed included in the 2.5 percent
monthly penalty. Furthermore, we hold that petitioner is entitled to
attorneys fees, but only in a sum equal to 10 percent of the amount
due which we deem reasonable under the proven facts.[25]
The Court deems it improper to discuss respondents' claim for
moral and other damages. Not having appealed the CA Decision,
they are not entitled to affirmative relief, as already explained
earlier.[26]
WHEREFORE, the Petition is GRANTED. The appealed Decision is
MODIFIED in that the remand is SET ASIDE and respondents are
ordered TO PAY P138,948, plus 2.5 percent penalty charge per
month beginning April 2, 1991 until fully paid, and 10 percent of
the amount due as attorneys fees. No costs.
SO ORDERED.

THIRD DIVISION
[A.M. No. MTJ-03-1513. November 12, 2003]
Spouses JAIME and PURIFICACION MORTA, complainants vs. Judge
ANTONIO C. BAGAGAN, Municipal Trial Court, Guinobatan, Albay;
and Sheriff DANILO O. MATIAS, Regional Trial Court, Branch 14,
Ligao, Albay, respondents.
DECISION
PANGANIBAN, J.:
Unreasonable delay in resolving motions opens a judge to
administrative sanctions. Likewise, a sheriff is administratively
liable for delayed implementation of a writ of execution and failure
to render the required reports thereon. These are necessary lessons
from the time-honored principle that justice delayed is justice
denied.
The Case and the Facts
In their Administrative Complaint[1] dated July 26, 2001, Spouses
Jaime and Purificacion Morta Sr. charged Judge Antonio C. Bagagan
of the Municipal Trial Court (MTC) of Guinobatan, Albay with gross
ignorance of the law, incompetence, bias and delay. They also
indicted Sheriff Danilo O. Matias of the Regional Trial Court (RTC) of
Ligao, Albay (Branch 14) with gross ignorance of the law,
negligence and connivance with the defendants in Civil Case Nos.
481 and 482 (MTC, Guinobatan, Albay). The Office of the Court
Administrator (OCA) summarized the factual antecedents as
follows:
x x x [In] a Complaint-Affidavit dated July 26, 2001 (with
enclosures), x x x [Spouses] Jaime and Purificacion Morta[,] through
their counsel[,] Atty. Rodolfo R. Paulino[,] charg[ed] [Respondent]
Judge Antonio C. Bagagan and Sheriff Danilo O. Matias with gross
ignorance of the law and procedure, incompetence, bias and delay
in the disposition of Civil Case No. 481, entitled Jaime Morta, Sr. and
Purficacion Padilla vs. Jamie Occidental and Atty. Mariano Baranda,
Jr., for Damages with Prayer for a Writ of Preliminary Injunction, and
Civil Case No. 482 entitled Jaime Morta, Sr. and Purficacion Padilla
vs. Jamie Occidental, Atty. Mariano Baranda, Jr. and Daniel Corral,
for Damages with Prayer for a Writ of Preliminary Injunction.

Complainants, who are the plaintiffs in the aforementioned civil

cases, allege[d] that on March 29, 1994[,] the Municipal Trial Court
[of] Guinobatan, Albay rendered a decision in their favor. The
decretal portion of the decision reads:
WHEREFORE, in view of the foregoing considerations, judgment is
rendered in favor of the plaintiffs and against the defendants in
both cases as follows:
1) Ordering the defendants not to molest and disturb the peaceful
possession of the plaintiffs in the lands in question situated at San
Rafael, Guinobatan;
2) Condemning the defendants in Civil Case No. 481 to jointly and
severally pay the plaintiffs the total amount of P8,130.00
representing the value of the coconuts, pili nuts and anahaw leaves
and for the destroyed plants;
3) Ordering the defendants in Civil Case No. 481 jointly and
severally to reimburse the plaintiffs the amount of P202.00 as legal
expenses incurred in filing their suit;
4) Condemning the defendants in Civil Case No. 482 jointly and
severally to pay the plaintiffs the total amount of P9,950.00
representing the value of the coconuts and anahaw leaves;
5) Ordering the said defendants in Civil Case No. 482 to jointly and
severally reimburse the plaintiffs the sum of P202.00 as legal
expenses in filing this suit.
The defendants appealed to the Regional Trial Court [of] Ligao,
Albay. In its decision dated August 10, 1994, the Regional Trial
Court [RTC] dismissed the aforesaid cases on the ground that the
claims for damages are tenancy-related problems which fall under
the original and exclusive jurisdiction of the Department of Agrarian
Reform Adjudicatory Board (DARAB). On September 9, 1994, the
plaintiffs filed a petition for review with the Court of Appeals
assailing the decision of the RTC. However, in its decision dated
May 31, 1995, the Court of Appeals affirmed the lower courts ruling
that the cases fall within the original and exclusive jurisdiction of
DARAB. Thereafter, the First Division of this Court, acting on the
petition for review on certiorari filed by the plaintiffs, rendered its
decision dated June 10, 1999 in G.R. No. 123417 affirming the
decision of the Municipal Trial Court, Guinobatan, Albay in Civil Case
Nos. 481 and 482 and thereby setting aside the decision of the

Court of Appeals in CA-GR SP No. 35300 and that of the Regional

Trial Court in Civil Cases Nos. 1751 and 1752.

482. Explaining that the delay was due to his heavy workload and
thus unintentional, he begged for compassion from this Court.

They now complain that despite the fact that the decision of the
Supreme Court in the aforesaid case had already become final and
executory, the respondent Judge still refused to issue a writ of
possession in their favor.

Evaluation and Recommendation of the OCA

Complainants further allege that on June 6, 2000 they filed a

motion to cite Jaime Occidental for contempt of court. Although
more than one (1) year had already elapsed since the motion was
filed in the respondent Judges sala, the same had remained
unresolved up to the filing of the instant complaint.
As against the respondent Sheriff, the complainants aver[red] that
through his ignorance, negligence and connivance with the
defendants, he failed to execute in full the writ of execution that
had been previously issued by the court in Civil Case Nos. 481 and
482. Moreover, it took respondent Sheriff a long time before he
finally submitted his Sheriff's Return of Service on the Writ of
Execution.[2]
In his Answer/Comment[3] dated April 2, 2002, respondent judge
explained that he had denied complainants Motion for the issuance
of a writ of possession because, by the time Civil Case Nos. 481
and 482 were finally decided by this Court on June 10, 1999, they
had already been ousted from the lots in question pursuant to the
Decisions in DARAB Case No. 2413 and Civil Case No. 1920. In Civil
Case No. 1920, respondent judge ordered complainants to vacate
the disputed lots. A Writ of Execution/Demolition was thereafter
issued on January 29, 1998. On the other hand, the DARAB
Decision, which became final and executory on October 27, 1998,
directed them to cease and desist from disturbing the peaceful
possession of therein Petitioner Jaime Occidental.
Regarding the alleged delay in the resolution of the Motion for
Contempt filed by complainants, respondent judge contended that
an ocular inspection and a hearing had been conducted by his court
as early as June 16, 2000, to determine if their Motion had any
basis. With the consent of their counsel, the hearing had to be
deferred, however, pending receipt of the Sheriffs Report in Civil
Case No. 1920.
For his part, Respondent Sheriff Matias admitted in his Comment[4]
dated April 18, 2002, that there was delay in the full
implementation of the Writ of Execution in Civil Case Nos. 481 and

The OCA found that the explanation of respondent judge for not
granting the Motion for Execution, filed by complainants, was
sufficient. According to the court administrator, the records showed
that they had indeed been evicted from the lots they were claiming
when Civil Case Nos. 481 and 482 were finally decided by the
Supreme Court on June 10, 1999.[5] Moreover, it emphasized that
this Court had merely affirmed the Decision of the MTC insofar as
the award of damages was concerned.
As to complainants Motion to cite Occidental in contempt, the OCA
held that the delay was due primarily to the need of the court to
clarify some important matters, not to the negligence or partiality
of respondent. Accordingly, it recommended that the charges
against him be dismissed for lack of merit.
On the other hand, the OCA found that Sheriff Matias had failed to
implement the Writ of Execution promptly and efficiently. It
recommended that he be ordered to pay a fine of P1,000, with a
warning that a repetition of the same or a similar act in the future
would be dealt with more severely.
The Courts Ruling
We modify the OCAs findings and recommended penalties,
consistent with Rule 140 of the Revised Rules of Court and the
Revised Uniform Rules on Administrative Cases in the Civil Service.
Administrative Liability
We agree with the OCA that respondent judge acted correctly in not
issuing a writ of execution/possession. His action was consistent
with the Decision of this Court in GR No. 123417 affirming that of
the MTC as to damages. Besides, the latters Order directing
defendants not to molest complainants in their peaceful possession
was rendered moot when they were ousted from the disputed lots
by virtue of the final and executory judgments in Civil Case No.
1920 and DARAB Case No. 2413. Indeed, the execution of a final
judgment may be refused, as in this case, when there has been a
change in the situation of the parties that would make its execution
inequitable.[6]

The delay in the resolution of complainants Motion, however, is an

altogether different matter. The Code of Judicial Conduct enjoins
trial court judges, as paragons of justice in the first instance, to
dispose of the courts business promptly[7] and to decide cases and
motions within the required periods.[8] Section 15(1) of Article VIII
of the Constitution mandates them to do so within three months
from the date of submission for decision or final resolution. This
Court, through Administrative Circular No. 1,[9] also specifically
requires all of them to act promptly on all motions and interlocutory
matters pending before their courts.[10]
Hence, it is well-settled that the unexplained failure of judges to
decide cases and resolve motions and incidents within the
reglementary period of 90 days, which is fixed by the Constitution
and the law, renders them administratively liable.[11] We have
stressed often enough that delay in the administration of justice
undermines the faith of the people in the judiciary, which is
expected to hear their supplications promptly. Delay reinforces in
the mind of litigants the impression that the wheels of justice grind
ever so slowly.[12] As the time-honored principle goes, justice
delayed is justice denied.
In this case, respondent judge never resolved the Motion, filed on
June 6, 2000, to cite Defendant Occidental for contempt. While it is
true that the former immediately conducted an ocular inspection of
the area to determine if the Motion had any basis, this act served
only to mitigate his infraction, but not absolve him from it. The
Sheriffs Return of Service of the Writ of Demolition issued in Civil
Case No. 1920 would have clarified whether or not Occidental had
already been fully restored in possession. But while its absence was
a valid reason to defer action on the contempt Motion at the outset,
it was certainly not an excuse for the prolonged inaction.
Had respondent judge been so minded, he would have requested a
copy of the Sheriffs Report, so that he could rule on the Motion with
dispatch. He has not satisfactorily explained his failure to do so,
considering that the Writ of Demolition issued in Civil Case No.
1920 had been fully executed as early as February 25, 1998, and
the return thereon made on March 17, 1998.[13]
With respect to the charges against respondent sheriff, we agree
with the OCA that he was remiss in his duty to implement the Writ
fully in Civil Case Nos. 481 and 482. Time and time again, we have
impressed upon those tasked to implement court orders and
processes to see to it that the final stage in the litigation process -the execution of judgment -- be carried out promptly. They should

exert every effort and indeed consider it their bounden duty to do

so, in order to ensure the speedy and efficient administration of
justice.[14] A decision that is left unexecuted or delayed indefinitely
because of the sheriffs inefficiency or negligence remains an empty
victory on the part of the prevailing party.[15] For this reason, any
inordinate delay in the execution of judgment is truly deplorable
and cannot be countenanced by the Court.
There is no mistaking the mandatory character of the period
prescribed under Section 14 of Rule 39 of the Revised Rules of
Court on the Return of a Writ of Execution, which reads:
SEC. 14. Return of writ of execution. The writ of execution shall be
returnable to the court issuing it immediately after the judgment
has been satisfied in part or in full. If the judgment cannot be
satisfied in full within thirty (30) days after his receipt of the writ,
the officer shall report to the court and state the reason therefor.
Such writ shall continue in effect during the period within which the
judgment may be enforced by motion. The officer shall make a
report to the court every thirty (30) days on the proceedings taken
thereon until the judgment is satisfied in full, or its effectivity
expires. The returns or periodic reports shall set forth the whole of
the proceedings taken, and shall be filed with the court and copies
thereof promptly furnished the parties.
A similar rule is stated in Administrative Circular No. 12 dated
October 1, 1985, and incorporated in the Manual for Clerks of
Court.[16] According to this Circular, all sheriffs and deputy sheriffs
shall submit to the judge concerned a report on actions taken on all
writs and processes assigned to them within 10 days from receipt.
Per the records of this case, a Writ of Execution was issued on
November 22, 1999 in Civil Case Nos. 481 and 482.[17] Respondent
Sheriffs Return of Service[18] of that Writ was filed only on May 25,
2000, however, or six months thereafter. There is nothing in the
records showing that he submitted before then a periodic report on
the actions he had taken on the Writ every 30 days from the date of
receipt as required. On the contrary, the Report indicates that the
Writ was partially executed on December 15-28, 1999 and January
11, 2000; and that the damages adjudged were partly paid in the
amount of P3,500 plus one unit of Karaoke machine. But it was only
on May 25, 2000, that this matter was reported to the trial court.
The excuse proffered by respondent sheriff -- heavy workload -cannot absolve him from administrative sanctions.[19] As an officer
of the court, he should at all times show a high degree of

professionalism in the performance of his duties.[20] He has failed

to observe that degree of dedication required of him as a sheriff.
The charge of connivance is, however, dismissed for lack of basis.
Although the OCA recommended that Respondent Judge Bagagan
be absolved of all charges, we find him guilty of undue delay[21] in
resolving a pending motion, an infraction that also constitutes a
violation of a Court circular.[22] Under Section 11(B) of Rule 140 of
the Revised Rules of Court, this less serious charge[23] may be
sanctioned by a fine of more than P10,000, but not exceeding
P20,000.
As to Sheriff Matias, we find him guilty of simple neglect of duty,
[24] a less grave offense under the Revised Uniform Rules on
Administrative Cases in the Civil Service. This infraction is
punishable by a suspension of one month and one day to six
months.[25] But under the circumstances, we find it inadvisable to
suspend respondent sheriff, considering that his work would be left
unattended in his absence. Instead, we adopt our previous ruling in
Aquino v. Lavadia [26] imposing a fine equivalent to his one-month
salary, so that he can finally implement the subject Writ and
perform his other duties.
WHEREFORE, Judge Antonio C. Bagagan of the Municipal Trial Court
of Guinobatan, Albay, is found guilty of unreasonable delay and is
FINED P11,000 with a stern warning that a repetition of the same or
a similar act in the future shall be dealt with more severely. On the
other hand, Sheriff Danilo O. Matias of the Regional Trial Court of
Ligao, Albay (Branch 14), is ordered to pay a fine equivalent to his
one-month salary, with a similar warning of stiffer sanctions for the
same or a similar act.
SO ORDERED.

FIRST DIVISION
[G.R. No. 148198 October 1, 2003]
PEOPLE OF THE PHILIPPINES, appellee, vs. ELIZABETH BETH
CORPUZ, appellant.
DECISION
YNARES-SANTIAGO, J.:
This is an appeal from the decision[1] of the Regional Trial Court of
Manila, Branch 54, in Criminal Case No. 99-176637 finding
appellant Elizabeth Corpuz guilty beyond reasonable doubt of
Illegal Recruitment in Large Scale constituting economic sabotage
under Sec. 6 (l) and (m) in relation to Sec. 7(b) of R.A. No. 8042,
otherwise known as the Migrant Workers and Overseas Filipinos Act
of l995, and sentencing her to life imprisonment and to pay a fine
of P500,000.00.
The Information against appellant reads as follows:
That sometime in July 1998 in the City of Manila and within the
jurisdiction of this Honorable Court, the above-named accused,
representing herself to have the capacity to contract, enlist and
transport workers abroad, did then and there willfully, unlawfully
and feloniously recruit for a fee the following persons, namely:
BELINDA CABANTOG, CONCEPCION SAN DIEGO, ERLINDA PASCUAL
AND RESTIAN SURIO for employment abroad without first obtaining
the required license and/or authority from the Philippine Overseas
Employment Administration and said accused failed to actually
deploy without valid reasons said complainants abroad and to
reimburse the expenses incurred by them in connection with their
documentation and processing for purposes of deployment abroad
to their damage and prejudice.
CONTRARY TO LAW.[2]
When arraigned on March 21, 2000, appellant pleaded not guilty.
Whereupon, trial on the merits ensued.
The facts of the case are as follows:
In June 1998, private complainants Belinda Cabantog, Concepcion
San Diego, Erlinda Pascual and Restian Surio went to Alga-Moher
International Placement Services Corporation at 1651 San

Marcelino Street, Malate, Manila to apply for employment as factory

workers in Taiwan. They were accompanied by a certain Aling Josie
who introduced them to the agencys President and General
Manager Mrs. Evelyn Gloria H. Reyes.[3] Mrs. Reyes asked them to
accomplish the application forms. Thereafter, they were told to
return to the office with P10,000.00 each as processing fee.[4]
On July 30, 1998, private complainants returned to the agency to
pay the processing fees. Mrs. Reyes was not at the agency that
time, but she called appellant on the telephone to ask her to
receive the processing fees. Thereafter, appellant advised them to
wait for the contracts to arrive from the Taiwan employers.[5]
Two months later, nothing happened to their applications. Thus,
private complainants decided to ask for the refund of their money
from appellant[6] who told them that the processing fees they had
paid were already remitted to Mrs. Reyes. When they talked to Mrs.
Reyes, she told them that the money she received from appellant
was in payment of the latters debt. Thus, on January 13, 1999,
private complainants filed their complaint with the National Bureau
of Investigation[7] which led to the arrest and detention of
appellant.
On March 23, 2000, while the case was before the trial court,
private complainants received the refund of their processing fees
from appellants sister-in-law. Consequently, they executed
affidavits of desistance[8] from participation in the case against
appellant.
For her part, appellant resolutely denied having a hand in the illegal
recruitment and claimed that she merely received the money on
behalf of Mrs. Reyes, the President/General Manager of Alga-Moher
International Placement Services Corporation, where she had been
working as secretary for three months prior to July 30, 1998. On
that day, Mrs. Reyes called her on the telephone and told her to
receive private complainants processing fees. In compliance with
the order of her employer and since the cashier was absent, she
received the processing fees of private complainants, which she
thereafter remitted to Mrs. Reyes. She had no knowledge that the
agencys license was suspended by the POEA on July 29, 1998.[9]
On November 16, 2000, the trial court rendered the assailed
decision, the dispositive portion of which reads:
WHEREFORE, in view of the above observations and findings
accused Elizabeth Beth Corpuz is hereby found guilty of the offense

charged in the Information for violation of Sec. 6 (l), (m) in relation

to Sec. 7 (b) of R.A. 8042 without any mitigating nor aggravating
circumstances attendant to its commission, without applying the
benefit of the Indeterminate Sentence Law, Elizabeth Beth Corpuz
is hereby sentenced to suffer a life imprisonment and to pay a fine
of P500,000.00.
Her body is hereby committed to the custody of the Director of the
Bureau of Correction for Women, Mandaluyong City thru the City Jail
Warden of Manila. She shall be credited with the full extent of her
preventive imprisonment under Art. 29 of the Revised Penal Code.

whether committed by any person, whether a non-licensee, nonholder, licensee or holder of authority:
xxxxxxxxx
(l) Failure to actually deploy without valid reason as determined by
the Department of Labor and Employment; and

No pronouncement of civil liability is hereby made since all the

complainants have been refunded of the fees.

(m) Failure to reimburse expenses incurred by the worker in

connection with his documentation and processing for purposes of
deployment, in cases where the deployment does not actually take
place without the worker's fault. Illegal recruitment when
committed by a syndicate or in large scale shall be considered an
offense involving economic sabotage.

SO ORDERED.[10]

xxxxxxxxx

In this appeal, appellant raises the following assignment of errors:

Illegal recruitment is deemed committed by a syndicate if carried

out by a group of three (3) or more persons conspiring or
confederating with one another. It is deemed committed in large
scale if committed against three (3) or more persons individually or
as a group.

THE TRIAL COURT ERRED IN CONVICTING THE ACCUSED IN THAT:

A. THE PROSECUTION FAILED TO PROVE BEYOND REASONABLE
DOUBT THAT THE ACCUSED REPRESENTED HERSELF TO HAVE THE
CAPACITY TO CONTRACT, ENLIST AND TRANSPORT WORKERS
ABROAD, OR UNLAWFULLY RECRUIT THE COMPLAINANTS FOR A
FEE.
B. THE PROSECUTION FAILED TO PROVE BEYOND REASONABLE
DOUBT THAT THE ACCUSED HAS MANAGEMENT CONTROL OVER
ALGA-MOHERs RECRUITMENT BUSINESS.[11]
The Information charged appellant for Illegal recruitment in large
scale under Section 6 (l) and (m) of R.A. No. 8042, otherwise known
as Migrant Workers and Overseas Filipinos Act of 1995, which reads:
SECTION 6. Definition. For purposes of this Act, illegal recruitment
shall mean any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring, or procuring workers and includes
referring, contract services, promising or advertising for
employment abroad, whether for profit or not, when undertaken by
a non-licensee or non-holder of authority contemplated under
Article 13(f) of Presidential Decree No. 442, as amended, otherwise
known as the Labor Code of the Philippines: Provided, That any
such non-licensee or non-holder who, in any manner, offers or
promises for a fee employment abroad to two or more persons shall
be deemed so engaged. It shall likewise include the following acts,

The persons criminally liable for the above offenses are the
principals, accomplices and accessories. In case of juridical
persons, the officers having control, management or direction of
their business shall be liable.
Appellant contends that she is not liable for the foregoing illegal
recruitment activities considering that she was merely an employee
having no control over the recruitment business of the Alga-Moher
International Placement Services Corporation and that she did not
actually recruit the private complainants. Moreover, she did not
appropriate for her own use the processing fees she received and
she had no knowledge that the agencys license was suspended by
the POEA.
The trial court convicted appellant based on its findings that
despite the suspension of the agencys license, appellant still
convinced the applicants to give their money with the promise to
land a job abroad. Moreover, as the registered secretary of the
agency she had management control of the recruitment business.
It is axiomatic that findings of facts of the trial court, its calibration
of the collective testimonies of witnesses and probative weight
thereof and its conclusions culled from said findings are accorded

by this Court great respect, if not conclusive effect, because of the

unique advantage of the trial court in observing and monitoring at
close range, the conduct, deportment and demeanor of the
witnesses as they testify before the trial court.[12] However, this
principle does not apply if the trial court ignored, misunderstood or
misconstrued cogent facts and circumstances of substance which,
if considered, would alter the outcome of the case.[13] The
exception obtains in this case.

Q. And why do you know this Ty was the owner?

A. Because she is the friend of Aling Josie, Sir.
Q. Now, after the introduction to this owner what happened?
A. We were told to fill up the application form by Mrs. Evelyn Ty, Sir.

The records of the case show that Alga-Moher International

Placement Service Corporation is a licensed land-based recruitment
agency. Its license was valid until August 24, 1999.[14] Likewise,
appellant was its registered secretary while Mrs. Evelyn Gloria H.
Reyes is its President/General Manager.[15] Part of its regular
business activity is to accept applicants who desire to work here or
abroad. Appellant, as secretary of the agency, was in charge of the
custody and documentation of the overseas contracts.

Q. And after filling up this application form, what did you do with
the same?

On July 30, 1998, appellant received the processing fees of the

private complainants since the cashier was absent that day. Her
receipt of the money was in compliance with the order of her
employer, Mrs. Reyes. She did not convince the applicants to give
her their money since they went to the agency precisely to pay the
processing fees upon the earlier advice of Mrs. Reyes. Private
complainant Belinda Cabantog testified as follows:

Q. When did you come back?

FISCAL BALLENA:

A. 1998, Your Honor.

Q. Please tell the Court how did it happen that you went to the said
agency?

FISCAL BALLENA:

A. When someone brought us there and introduced to the owner,

Sir.
Q. And who is this friend or person you said you know who
accompanied you?
A. Aling Josie, Sir.
Q. What is her full name?
A. I do not know, Sir.
Q. And who is this owner to whom you were introduced?
A. Mrs. Evelyn Ty, Sir.

A. We went home and we were asked to come back, Sir.

Q. Now, did you come back?
A. Yes, Sir.

A. July 30, Sir.

COURT:
Q. What year?

Q. What happened when you come back?

A. When we came back we brought along the processing fee they
needed, Sir.
Q. Why did you bring this processing fee?
A. We were required to bring it for the smooth processing of the
papers, Sir.
Q. Who required you to bring this processing fee?
A. Mrs. Evelyn Ty, Sir.
Q. Now, when you came back what happened?

A. She was not at the office so she called up by phone and told us
to give the money, Sir.
Q. And to whom did to give the money?
A. Beth Corpuz, Sir.[16]
From the foregoing testimony, it is clear that all appellant did was
receive the processing fees upon instruction of Mrs. Reyes. She
neither convinced the private complainants to give their money nor
promised them employment abroad.
Moreover, as stated in the last sentence of Section 6 of RA 8042,
the persons who may be held liable for illegal recruitment are the
principals, accomplices and accessories. In case of juridical
persons, the officers having control, management or direction of
their business shall be liable.
In the case at bar, we have carefully reviewed the records of the
case and found that the prosecution failed to establish that
appellant, as secretary, had control, management or direction of
the recruitment agency. Appellant started her employment with the
agency on May 1, 1998 and she was tasked to hold and document
employment contracts from the foreign employers.[17] She did not
entertain applicants and she had no discretion over how the
business was managed.[18] The trial courts finding that appellant,
being the secretary of the agency, had control over its business, is
not only non sequitur but has no evidentiary basis.
An employee of a company or corporation engaged in illegal
recruitment may be held liable as principal, together with his
employer, if it is shown that he actively and consciously
participated in illegal recruitment. Settled is the rule that the
existence of the corporate entity does not shield from prosecution
the corporate agent who knowingly and intentionally causes the
corporation to commit a crime. The corporation obviously acts, and
can act, only by and through its human agents, and it is their
conduct which the law must deter. The employee or agent of a
corporation engaged in unlawful business naturally aids and abets
in the carrying on of such business and will be prosecuted as
principal if, with knowledge of the business, its purpose and effect,
he consciously contributes his efforts to its conduct and promotion,
however slight his contribution may be. The law of agency, as
applied in civil cases, has no application in criminal cases, and no
man can escape punishment when he participates in the
commission of a crime upon the ground that he simply acted as an

agent of any party. The culpability of the employee therefore hinges

on his knowledge of the offense and his active participation in its
commission. Where it is shown that the employee was merely
acting under the direction of his superiors and was unaware that his
acts constituted a crime, he may not be held criminally liable for an
act done for and in behalf of his employer.[19]
Anent the issue of whether or not appellant knowingly and
intentionally participated in the commission of the crime charged,
we find that she did not.
In the appreciation of evidence in criminal cases, it is a basic tenet
that the prosecution has the burden of proof in establishing the
guilt of the accused for the offense with which he is charged.[20] Ei
incumbit probation qui dicit non qui negat, i.e., he who asserts, not
he who denies, must prove.[21] The conviction of appellant must
rest not on the weakness of his defense, but on the strength of the
prosecutions evidence.[22]
In the case at bar, the prosecution failed to adduce sufficient
evidence to prove appellants active participation in the illegal
recruitment activities of the agency. As already established,
appellant received the processing fees of the private complainants
for and in behalf of Mrs. Reyes who ordered her to receive the
same. She neither gave an impression that she had the ability to
deploy them abroad nor convinced them to part with their money.
More importantly, she had no knowledge that the license was
suspended the day before she received the money. Their failure to
depart for Taiwan was due to the suspension of the license, an
event which appellant did not have control of. Her failure to refund
their money immediately upon their demand was because the
money had been remitted to Mrs. Reyes on the same day she
received it from them.
While we strongly condemn the pervasive proliferation of illegal job
recruiters and syndicates preying on innocent people anxious to
obtain employment abroad, nevertheless, we find the pieces of
evidence insufficient to prove the guilt of appellant beyond
reasonable doubt. They do not pass the requisite moral certainty,
as they admit of the alternative inference that other persons, not
necessarily the appellant, may have perpetrated the crime. Where
the evidence admits of two interpretations, one of which is
consistent with guilt, and the other with innocence, the accused
must be acquitted. Indeed, it would be better to set free ten men
who might be probably guilty of the crime charged than to convict
one innocent man for a crime he did not commit.[23]

WHEREFORE, in view of the foregoing, the decision of the Regional

Trial Court Regional Trial Court of Manila, Branch 54, in Criminal
Case No. 99-176637 finding appellant Elizabeth Corpuz guilty
beyond reasonable doubt of Illegal Recruitment in Large Scale
constituting economic sabotage under Sec. 6 (l) and (m) in relation
to Sec. 7(b) of R.A. No. 8042, is REVERSED and SET ASIDE.
Appellant Elizabeth Corpuz is ACQUITTED of the offense charged on

the ground of reasonable doubt. The Superintendent of the

Correctional Institution for Women is directed to cause the
immediate release of appellant unless she is lawfully held for
another offense, and to inform this Court of the date of her release,
or the ground for her continued confinement, within ten days from
notice.
SO ORDERED.