You are on page 1of 21

Abejo v dela Cruz. G.R. No.

L-63558 May 19, 1987


F: Case involves a dispute between the principal stockholders of the corporation
Pocket Bell Philippines, Inc. (Pocket Bell), a "tone and voice paging corporation,"
namely, the spouses Jose Abejo and Aurora Abejo vs. De la Cruz Abejo (hereinafter
referred to as the Abejos) and the purchaser, Telectronic Systems, Inc. (hereinafter
referred to as Telectronics) of their 133,000 minority shareholdings (for P6 million)
and of 63,000 shares registered in the name of Virginia Braga and covered by five
stock certificates endorsed in blank by her (for P1,674,450.00), and the spouses
Agapito Braga and Virginia Braga (hereinafter referred to as the Bragas), erstwhile
majority stockholders. With the said purchases, Telectronics would become the
majority stockholder, holding 56% of the outstanding stock and voting power of the
corporation Pocket Bell. Telectronics requested the corporate secretary of the
corporation, Norberto Braga, to register and transfer to its name, and those of its
nominees the total 196,000 Pocket Bell shares in the corporation's transfer book,
cancel the surrendered certificates of stock and issue the corresponding new
certificates of stock in its name and those of its nominees. Norberto Braga, the
corporate secretary and son of the Bragas, refused to register the aforesaid transfer
of shares in the corporate books, asserting that the Bragas claim preemptive rights
over the 133,000 Abejo shares and that Virginia Byaga never transferred her 63,000
shares to Telectronics but had lost the five stock certificates representing those
shares. This triggered off the series of intertwined actions between the protagonists,
all centered on the question of jurisdiction over the dispute. The Bragas assert that
the regular civil court has original and exclusive jurisdiction as against the Securities
and Exchange Commission, while the Abejos and Telectronics, as new majority
shareholders, claim the contrary. Respondent Judge de la Cruz issued an order
rescinding the order which dismissed the complaint of the Bragas in the RTC, thus
holding that the RTC and not the SEC had jurisdiction. Respondent judge also
revived the temporary restraining order previously issued restraining Telectronics'
agents or representatives from enforcing their resolution constituting themselves as
the new set of officers of Pocket Bell and from assuming control of the corporation
and discharging their functions.
The Abejos filed a MR, which motion was duly opposed by the Bragas, which was
denied by respondent Judge.
I: W/N the RTC, as claimed by the Bragas, has jurisdiction over the case or the SEC,
as claimed by the Abejos
H: The Court ruled that the SEC has original and exclusive jurisdiction over the
dispute between the principal stockholders of the corporation Pocket Bell, namely,
the Abejos and Telectronics, the purchasers of the 56% majority stock on the one
hand, and the Bragas, erstwhile majority stockholders, on the other, and that the
SEC, through its en banc Resolution of May 15, 1984 correctly ruled in dismissing
the Bragas' petition questioning its jurisdiction, that "the issue is not the ownership
of shares but rather the nonperformance by the Corporate Secretary of the
ministerial duty of recording transfers of shares of stock of the Corporation of which
he is secretary." The SEC ruling upholding its primary and exclusive jurisdiction over

the dispute is correctly premised on, and fully supported by, the applicable
provisions of P.D. No. 902-A which reorganized the SEC with additional powers "in
line with the government's policy of encouraging investments, both domestic and
foreign, and more active public participation in the affairs of private corporations
and enterprises through which desirable activities may be pursued for the
promotion of economic development and, to promote a wider and more meaningful
equitable distribution of wealth. The dispute at bar, as held by the SEC, is an
intracorporate dispute that has arisen between and among the principal
stockholders of the corporation Pocket Bell due to the refusal of the corporate
secretary, backed up by his parents as erstwhile majority shareholders, to perform
his "ministerial duty" to record the transfers of the corporation's controlling (56%)
shares of stock, covered by duly endorsed certificates of stock, in favor of
Telectronics as the purchaser thereof. Mandamus in the SEC to compel the corporate
secretary to register the transfers and issue new certificates in favor of Telectronics
and its nominees was properly resorted to therefore.
The very complaint of the Bragas for annulment of the sales and transfers as filed
by them in the regular court questions the validity of the transfer and endorsement
of the certificates of stock, claiming alleged preemptive rights in the case of the
Abejos' shares and alleged loss of the certificates and lack of consent and
consideration in the case of Virginia Braga's shares. Such dispute clearly involves
controversies "between and among stockholders," as to the Abejos' right to sell and
dispose of their shares to Telectronics, the validity of the latter's acquisition of
Virginia Braga's shares, who between the Bragas and the Abejos' transferee should
be recognized as the controlling shareholders of the corporation, with the right to
elect the corporate officers and the management and control of its operations. Such
a dispute and case clearly fall within the jurisdiction of the SEC to decide, under
Section 5 of P.D. 902-A.
Insofar as the Bragas and their corporate secretary's refusal on behalf of the
corporation Pocket Bell to record the transfer of the 56% majority shares to
Telectronics may be deemed a device or scheme amounting to fraud and
misrepresentation employed by them to keep themselves in control of the
corporation to the detriment of Telectronics (as buyer and substantial investor in the
corporate stock) and the Abejos (as substantial stockholders-sellers), the case falls
under paragraph (a). The dispute is likewise an intra-corporate controversy between
and among the majority and minority stockholders as to the transfer and disposition
of the controlling shares of the corporation, falling under paragraph (b) of Sec 5 PD
902-A. As pointed out by the Abejos, Pocketbell is not a close corporation, and no
restriction over the free transferability of the shares appears in the Articles of
Incorporation, as well as in the bylaws 10 and the certificates of stock themselves,
as required by law for the enforcement of such restriction. As the SEC maintains,
"There is no requirement that a stockholder of a corporation must be a registered
one in order that the Securities and Exchange Commission may take cognizance of
a suit seeking to enforce his rights as such stockholder." This is because the SEC by
express mandate has "absolute jurisdiction, supervision and control over all
corporations" and is called upon to enforce the provisions of the Corporation Code,

among which is the stock purchaser's right to secure the corresponding certificate in
his name under the provisions of Section 63 of the Code.
An intra-corporate controversy is one which arises between a stockholder and the
corporation. There is no distinction, qualification, nor any exemption whatsoever.
The provision is broad and covers all kinds of controversies between stockholders
and corporations.

Bernardo v. Abalos [G.R. No. 137266. December 5, 2001]


FACTS: Antonio Bernardo, et al filed a criminal complaint against Benjamin Abalos,
Sr. and Jr., and others for vote buying in violation of the Omnibus Election Code.
They alleged that the Abaloses sponsored an outing for the public school teachers
who were also registered voters and members of the Board of Election Inspectors in
Mandaluyong City, several weeks before the elections were to take place. Abalos Sr.
also allegedly delivered a speech promising the said teachers hazard pay and an
increase in their allowances of a total of P3,000.00. The COMELEC issued a
resolution dismissing the complaint for insufficiency of evidence to establish a prima
facie case. The petitioners then filed a petition for certiorari with the SC for the
nullification of the COMELEC's Resolution, citing that it was issued with apparent
grave abuse of discretion. The petition was filed without first submitting a motion
for reconsideration with the COMELEC.
ISSUE: W/N petitioners' failure to file the required motion for reconsideration with
the COMELEC is fatal to their cause.
HELD: YES. Petitioners' failure to file the required motion for reconsideration utterly
disregarded the COMELEC Rules intended to achieve an orderly, just, expeditious
and inexpensive determination and disposition of every action and proceeding
brought before the Commission. A petition for certiorari can only be resorted to if
there is no appeal, or any plain, speedy, and adequate remedy in the ordinary
course of law. Having failed to file the required motion for reconsideration of the
challenged Resolution, petitioners' instant petition is certainly premature.
Significantly, they have not raised any plausible reason for their direct recourse to
this Court. RATIO: A petition for certiorari can only be resorted to if there is no
appeal, or any plain, speedy, and adequate remedy in the ordinary course of law.

Industrial Enterprises, Inc. vs. Court of Appeals, 184 SCRA


426 G.R. No. 88550
April 18, 1990
TOPIC: ADMINISTRATIVE REMEDIES
1. Distinguish the doctrine of primary jurisdiction from the doctrine of exhaustion of
administrative remedies.

2. Does the failure to exhaust administrative remedies before filing a case in court
oust said court of jurisdiction to hear the case? Explain.
Suggested Answer:
1. The doctrine of primary jurisdiction and the doctrine of exhaustion of
administrative remedies both deal with the proper relationships between the courts
and administrative agencies. The doctrine of exhaustion of administrative remedies
applies where a claim is cognizable in the first instance by an administrative agency
alone. Judicial interference is withheld until the administrative process has been
completed. As stated in Industrial Enterprises, Inc. vs. Court of Appeals, 184 SCRA
426, the doctrine of primary jurisdiction applies where a case is within the
concurrent jurisdiction of the court and an administrative agency but the
determination of the case requires the technical expertise of the administrative
agency. In such a case, although the matter is within the jurisdiction of the court, it
must yield to the jurisdiction of the administrative case.

2. No, the failure to exhaust administrative remedies before filing a case in court
does not oust the court of jurisdiction to hear the case. As held in Rosario vs. Court
of Appeals, 211 SCRA 384, the failure to exhaust administrative remedies does not
affect the jurisdiction of the court but results in the lack of a cause of action,
because a condition precedent that must be satisfied before action can be filed was
not fulfilled.

GSIS V. CIVIL SERVICE G.R. Nos. 98395-102449 June 19, 1995

FACTS

The GSIS dismissed six government employees on account of irregularities in the


canvassing of supplies. The employees appealed to the Merit Board. Said board
found for the employees and declared the dismissal as illegal because no hearing
took place. The GSIS took the issue to the Civil Service which then ruled that the
dismissal was indeed illegal. The CSC thereafter ordered the reinstatement of the
employees and demanded the payment of backwages. The replacements of the
dismissed employees should then be released from service.
The GSIS remained unconvinced and raised the issue to the SC. SC affirmed the Civil
Service ruling saying o The CSC acted within its authority o Reinstatement was

proper o However, the SC modified the requirement of backpay. Said backpay


should be made after the outcome of the disciplinary proceedings.
Heirs of the dismissed employees filed a motion for execution of the Civil Service
resolution so that backwages can be paid. GSIS however denied the motion saying
that the SC modified that part of the ruling.
CSC nonetheless thumbed its nose to the GSIS and granted the motion. GSIS was
made to pay. Backed against the wall, GSIS filed certiorari with the SC asking that
the CSC order be nullified. The GSIS contends that the CSC has no power to execute
its judgments.

ISSUE

Whether the Civil Service has the power to enforce its judgments

HELD

YES. The Civil Service Commission is a consitutional commission invested by the


Constitution and relevant laws not only with authority to administer the civil service,
but also with quasi-judicial powers. It has the authority to hear and decide
administrative disciplinary cases instituted directly with it or brought to it on appeal.
It has the power, too, sitting en banc, to promulgate its own rules concerning
pleadings and practice before it or before any of its offices, which rules should not
however diminish, increase, or modify substantive rights.
In light of all the foregoing consitutional and statutory provisions, it would appear
absurd to deny to the Civil Service Commission the power or authority or order
execution of its decisions, resolutions or orders. It would seem quite obvious that
the authority to decide cases is inutile unless accompanied by the authority to see
that what has been decided is carried out. Hence, the grant to a tribunal or agency
of adjudicatory power, or the authority to hear and adjudge cases, should normally
and logically be deemed to include the grant of authority to enforce or execute the
judgments it thus renders, unless the law otherwise provides.
Therefore, the GSIS must yield to the order of the CSC.

Paat vs CA Admin Law Digest

Leonardo Paat
vs
Court of Appeals, et. Al.
GR No. 111107, 10 January 1997
266 SCRA 167
FACTS
The truck of private respondent Victoria de Guzman was seized by the DENR
personnel while on its way to Bulacan because the driver could not produce the
required documents for the forest product found concealed in the truck. Petitioner
Jovito Layugan, CENRO ordered the confiscation of the truck and required the owner
to explain. Private respondents failed to submit required explanation. The DENR
Regional Executive Director Rogelio Baggayan sustained Layugans action for
confiscation and ordered the forfeiture of the truck. Private respondents brought the
case to the DENR Secretary. Pending appeal, private respondents filed a replevin
case before the RTC against petitioner Layugan and Baggayan. RTC granted the
same. Petitioners moved to dismiss the case contending, inter alia, that private
respondents had no cause of action for their failure to exhaust administrative
remedies. The trial court denied their motion. Hence, this petition for review on
certiorari. Petitioners aver that the trial court could not legally entertain the suit for
replevin because the truck was under administrative seizure proceedings.

ISSUE
Whether or not the instant case falls within the exception of the doctrine.

HELD
The Court held in the negative. The Court has consistently held that before a
party is allowed to seek the intervention of the court, it is a pre-condition that he
should have availed of all the means of administrative processed afforded him.
Hence, if a remedy within the administrative machinery can still be resorted to by
giving the administrative officer concerned every opportunity to decide on a matter
that comes within his jurisdiction then such remedy should be exhausted first before
courts judicial power can be sought. The premature invocation of court
intervention is fatal to ones cause of action.

The doctrine is a relative one and its flexibility is called upon by the
peculiarity and uniqueness of the factual and circumstantial settings of a case.
Hence, it is disregarded (1) when there is violation of due process, (2) when the
issue involved is purely a legal question, (3) when the administrative action is
patently illegal amounting to lack or excess of jurisdiction, (4) when there is
estoppels on the part of the administrative agency concerned, (5) when there is
irreparable injury, (6) when the respondent is a department secretary whose acts as
an alter ego of the President bears the implied and assumed approval of the latter,
(7) when to require exhaustion of administrative remedies would be unreasonable,
(8) when it would amount to nullification of a claim, (9) when the subject matter is a
private land in land case proceedings, (10) when the rule does not provide a plain,
speedy and adequate remedy, and (11) when there are circumstances indicating
the urgency of judicial intervention.

A suit for replevin cannot be sustained against the petitioners for the subject truck
taken and retained by them for administrative forfeiture proceedings in pursuant to
Sections 68-A of OD 705, as amended. Dismissal of the replevin suit for lack of
cause of action in view of the private respondents failure to exhaust administrative
remedies should have been the proper course of action by the lower court instead
of assuming jurisdiction over the case and consequently issuing the writ ordering
the return of the truck.

G.R. No. 74930 February 13, 1989 RICARDO VALMONTE, OSWALDO


CARBONELL, DOY DEL CASTILLO, ROLANDO BARTOLOME, LEO
OBLIGAR, JUN GUTIERREZ, REYNALDO BAGATSING, JUN "NINOY"
ALBA, PERCY LAPID, ROMMEL CORRO and ROLANDO FADUL,
petitioners, vs. FELICIANO BELMONTE, JR., respondent.
Valmonte Vs Belmonte

FACTS : Petitioners in this special civil action for mandamus with preliminary
injunction invoke their right to information and pray that respondent be directed: (a)
to furnish petitioners the list of the names of the Batasang Pambansa members
belonging to the UNIDO and PDP-Laban who were able to secure clean loans
immediately before the February 7 election thru the intercession/marginal note of
the then First Lady Imelda Marcos; and/or (b) to furnish petitioners with certified
true copies of the documents evidencing their respective loans; and/or (c) to allow

petitioners access to the public records for the subject information On June 20,
1986, apparently not having yet received the reply of the Government Service and
Insurance System (GSIS) Deputy General Counsel, petitioner Valmonte wrote
respondent another letter, saying that for failure to receive a reply, "(W)e are now
considering ourselves free to do whatever action necessary within the premises to
pursue our desired objective in pursuance of public interest."

ISSUE : WON Valmonte, et. al. are entitled as citizens and taxpayers to inquire upon
GSIS records on behest loans given by the former First Lady Imelda Marcos to
Batasang Pambansa members belonging to the UNIDO and PDP-Laban political
parties.

HELD : Respondent has failed to cite any law granting the GSIS the privilege of
confidentiality as regards the documents subject of this petition. His position is
apparently based merely on considerations of policy. The judiciary does not settle
policy issues. The Court can only declare what the law is, and not what the law
should be. Under our system of government, policy issues are within the domain of
the political branches of the government, and of the people themselves as the
repository of all State power. The concerned borrowers themselves may not succeed
if they choose to invoke their right to privacy, considering the public offices they
were holding at the time the loans were alleged to have been granted. It cannot be
denied that because of the interest they generate and their newsworthiness, public
figures, most especially those holding responsible positions in government, enjoy a
more limited right to privacy as compared to ordinary individuals, their actions
being subject to closer public scrutiny The "transactions" used here I suppose is
generic and, therefore, it can cover both steps leading to a contract, and already a
consummated contract, Considering the intent of the framers of the Constitution
which, though not binding upon the Court, are nevertheless persuasive, and
considering further that government-owned and controlled corporations, whether
performing proprietary or governmental functions are accountable to the people,
the Court is convinced that transactions entered into by the GSIS, a governmentcontrolled corporation created by special legislation are within the ambit of the
people's right to be informed pursuant to the constitutional policy of transparency in
government dealings. Although citizens are afforded the right to information and,
pursuant thereto, are entitled to "access to official records," the Constitution does
not accord them a right to compel custodians of official records to prepare lists,
abstracts, summaries and the like in their desire to acquire information on matters
of public concern.

MANGUBAT vs. OSMENA

Doctrine: Mangubat vs. Osmea, G.R. No. L-12837, April 30, 1959,
there is no need to exhaust all administrative remedies by
appealing to Civil Service Commission, since the act of the governor
is patently illegal.

PROSECUTOR LEO C. TABAO, Regional Chairman, Special Task Force on Environment


and Natural Resources (STF-ENR) of Region 8, Tacloban City, complainant, vs. JUDGE
FRISCO T. LILAGAN, Presiding Judge, Regional Trial Court, Leyte, Branch 34, and
SHERIFF IV LEONARDO V. AGUILAR, Office of the Clerk of Court, Regional Trial Court,
Tacloban City, Respondents.
This is an administrative complaint filed by Atty. Leo C. Tabao, Assistant City
Prosecutor of Tacloban, in his capacity as Regional Chairman of the Region 8 Special
Task Force on Environment and Natural Resources, against (1) Judge Frisco T.
Lilagan, presiding judge of the Leyte Regional Trial Court, Branch 34, for gross
ignorance of the law, gross abuse of judicial authority, and willful disobedience to
settled jurisprudence; and (2) Sheriff IV Leonardo V. Aguilar of the Leyte RTC, Office
of the Clerk of Court, for gross irregularity in the performance of official duties,
giving unwarranted benefits to a private individual, violation of Section 1(b) and (c)
of P.D. No. 1829, and conduct prejudicial to the best interest of the service.
The records of this case reveal the following facts.
On February 24, 1998, a water craft registered under the name M/L Hadija, from
Bongao, Tawi-tawi, was docked at the port area of Tacloban City with a load of
around 100 tons of tanbark. Due to previous irregular and illegal shipments of
tanbark from Bongao, agents of the National Bureau of Investigation in Region 8
(NBI-EVRO #8) decided to verify the shipments accompanying documents as the
M/L Hadija was unloading its cargo to its consignee, a certain Robert Hernandez.
The NBI agents found the documents irregular and incomplete, and consequently
they ordered the unloading of the cargo stopped. The tanbark, the boat M/L Hadija,
and three cargo trucks were seized and impounded.
On March 5, 1998, NBI-EVRO #8 Regional Director Carlos S. Caabay filed a criminal
complaint for violation of Section 68 (now Section 78) of P.D. No. 705, [1 the
Forestry Reform Code of the Philippines (as amended), against the captain and crew
of the M/L Hadija, Robert Hernandez, Tandico Chion, Alejandro K. Bautista, and
Marcial A. Dalimot. Bautista was a forester while Dalimot was a Community
Environment and Natural Resources Officer (CENRO) of the Department of
Environment and Natural Resources (DENR) office in Tacloban City. Bautista and
Dalimot were, thus, also charged with violation of Section 3(e) of R.A. No. 3019 or
the Anti-Graft and Corrupt Practices Act, [2 along with Habi A. Alih and Khonrad V.
Mohammad of the CENRO-Bongao, Tawi-tawi. The complaint was docketed as I.S.
No. 98-296 at the Prosecutors Office of Tacloban City.
In an order dated March 6, 1998, [3 complainant directed the seizure by the DENR
of the M/L Hadija, its cargo, and the three trucks pending preliminary investigation

of the case. DENR thus took possession of the aforesaid items on March 10, 1998,
with notice to the consignee Robert Hernandez and the NBI Regional Director.
On March 11, 1998, Hernandez filed in the Regional Trial Court of Leyte a case for
replevin to recover the items seized by the DENR. The case was raffled off to Branch
34 of said court and docketed as Civil Case No. 98-03-42.
On March 16, 1998, subpoenas were issued to the respondents in I.S. No. 98-296.
On March 17, 1998, confiscation proceedings were conducted by the Provincial
Environment and Natural Resources Office (PENRO)-Leyte, with both Hernandez and
his counsel present.
On March 19, 1998, herein respondent Judge Frisco T. Lilagan issued a writ of
replevin and directed respondent Sheriff IV Leonardo V. Aguilar to take possession of
the items seized by the DENR and to deliver them to Hernandez after the expiration
of five days. [4 Respondent sheriff served a copy of the writ to the Philippine Coast
Guard station in Tacloban City at around 5:45 p.m. of March 19, 1998.
Thus, the filing of this administrative complaint against respondents via a letter
addressed to the Chief Justice and dated April 13, 1998, by Atty. Tabao.
Complainant avers that replevin is not available where the properties sought to be
recovered are involved in criminal proceedings for illegal logging. He points out that
this is a well-settled issue and cites several decisions [5 of this Court and the Court
of Appeals on the matter. He argues that respondent judge should have known of
the existing jurisprudence on this issue, particularly since they are subject to
mandatory judicial notice per Section 1, Rule 129 of the Revised Rules of Court.
Complainant submits that respondent judge is either grossly ignorant of the law and
jurisprudence or purposely disregarded them. But he avers that it is respondent
judges duty to keep abreast of developments in law and jurisprudence.
Complainant claims that respondent judge cannot claim ignorance of the
proceedings in I.S. No. 98-296 for the following reasons: (1) the defendants in the
replevin case were all DENR officers, which should have alerted respondent judge to
the possibility that the items sought to be recovered were being held by the
defendants in their official capacities; and (2) the complaint for replevin itself states
that the items were intercepted by the NBI for verification of supporting documents,
which should have made respondent judge suspect that the same were being held
by authority of law.
As regards respondent sheriff Leonardo V. Aguilar, complainant states that it was
incumbent upon Aguilar to safeguard the M/L Hadija and prevent it from leaving the
port of Tacloban City, after he had served a writ of seizure therefor on the Philippine
Coast Guard. However, on March 19, 1998, the vessel left the port of Tacloban City,
either through respondent sheriffs gross negligence or his direct connivance with
interested parties, according to complainant. As of the time of the filing of the
complaint, according to complainant, the whereabouts of the vessel and its crew
were unknown.

Moreover, complainant points out that respondent sheriff released the seized
tanbark to Hernandez on March 20 and 21, 1998, or within the five-day period that
he was supposed to keep it under the terms of the writ. Complainant argues that
the tanbark formed part of the peoples evidence in the criminal complaint against
Hernandez and the others. By his act, respondent sheriff effectively altered,
suppressed, concealed, or destroyed the integrity of said evidence. For this act,
complainant contends that respondent sheriff may be held liable under Section 1(b)
of P.D. 1829, Penalizing Obstruction of Apprehension and Prosecution of Criminal
Offenders. [6 Respondent sheriffs acts also constitute gross irregularity in the
performance of his duty as a court employee.
Complainant notes that respondent sheriff was absent from his office from March 20
to March 24, 1998. This period included the dates he was supposed to have
released the tanbark to Hernandez. Complainant contends that respondent sheriff
not only unlawfully released the tanbark, he also made it appear that he was not
physically present when such act was done.
In separate indorsements dated September 9, 1998, then Court Administrator
Alfredo L. Benipayo referred this administrative matter to both respondents for
comment.
In his comment dated October 12, 1998, [7 respondent judge calls the attention of
the Office of the Court Administrator to a pending motion to dismiss filed by the
defendants in the replevin case that effectively prevented him from commenting on
the issue. The discussions that would have to be included in the comment, he says,
would also resolve the pending motion to dismiss. Respondent judge contends that
complainant should have been prudent enough to wait for the resolution of the
motion to dismiss before filing the instant administrative case.
Respondent judge claims that he was unaware of the existence of I.S. No. 98-296.
He only learned of the criminal case from an urgent manifestation dated March 20,
1998, filed by complainant. He argues that he issued an order dated March 25,
1998, suspending the transfer to Hernandez of possession of the subject items,
pending resolution of the urgent manifestation.
Respondent judge stresses that the writ of replevin was issued in strict compliance
with the requirements laid down in Rule 60 of the Revised Rules of Court. He also
points out that said writ was issued provisionally and was not intended to be the
final disposition of the replevin case.
Respondent judge avers that the charge of gross ignorance of the law is premature
since he has not made a ruling yet on the motion to dismiss filed in the replevin
case. He contends that it was too much to ask from him to take note of the fact that
the defendants in said case were officials of DENR and make assumptions based on
such fact. Moreover, respondent judge submits that while the complaint alleged that
the cargo of tanbark was intercepted by the NBI, it also alleged that the consignee
thereof produced documents to prove that the shipment was legal.

In conclusion, respondent judge points out that no apprehension report was issued
by the NBI regarding the shipment. Neither did the DENR issue a seizure report.
Respondent judge contends that the validity of the seizure of the subject items by
the DENR is a matter that will have to be resolved in relation to the motion to
dismiss.
For his part, respondent sheriff submits [8 that he served the writ of replevin on the
Coast Guard precisely to prevent the departure of the subject vessel, since he does
not have the means to physically prevent said vessel from sailing. The Coast Guard
commander should have examined the vessel and its crew after being served the
writ, to determine whether or not they were engaged in any illegal activity.
Respondent sheriff narrates that no cargo was on board the vessel when he served
the writ on the Coast Guard. He verified the cargos status with DENR, which
furnished him a copy of a fax transmission stating that the tanbark came from
legitimate sources except that the shipment documents were not in order. [9
Respondent sheriff contends that it was his ministerial duty to serve the writ of
replevin, absent any instruction to the contrary. He argues further that since the
items subject of the writ are in the custody of the court and could be disposed of
only through court order, there could not be any unwarranted benefit to a private
individual as claimed by complainant.
Noting that the questioned shipment of tanbark was not covered by either an NBI
apprehension report or a DENR seizure report, respondent sheriff contends that
complainant should have taken steps to protect the integrity of the shipment
instead of heaping blame upon others for his own negligence. Respondent sheriff
avers that it was not his intention to obstruct the apprehension and prosecution of
criminal offenders, contrary to complainants claim.
Respondent sheriff refutes complainants claim that he was absent from his office
from March 20 to March 24, 1998, and alleges that it was complainant who was
absent from court hearings on several occasions, in violation of his duty as a
prosecutor.
Respondent submitted two supplemental comments dated October 30, 1998, [10
and May 3, 1999, [11 (1) reiterating his contention that the tanbark seized by the
DENR and subject of the replevin case had been found to come from a legitimate
source, per an order signed by the Regional Director (Region 8) of the DENR, [12
and (2) informing the OCA that the main replevin case was dismissed per an order
of respondent judge dated November 27, 1998. [13
As required by resolution of the Court dated January 24, 2001, the parties herein
separately manifested that they are willing to have the present case resolved based
on the record on hand.
We note that in its report dated April 8, 1999, the OCA, after reviewing the case,
recommended that respondent judge be fined in the amount of P15,000.00 for gross
ignorance of the law. At the same time, the OCA recommended that the charges
against respondent sheriff be dismissed for lack of merit.

The recommendation of the OCA is well taken, except for the amount of the fine to
be imposed on said respondent judge.
The complaint for replevin itself states that the shipment of tanbark as well as the
vessel on which it was loaded were seized by the NBI for verification of supporting
documents. [14 It also states that the NBI turned over the seized items to the DENR
for official disposition and appropriate action. [15 A copy of the document
evidencing the turnover to DENR was attached to the complaint as Annex D. [16 To
our mind, these allegations would have been sufficient to alert respondent judge
that the DENR has custody of the seized items and that administrative proceedings
may have already been commenced concerning the shipment. Under the doctrine of
primary jurisdiction, courts cannot take cognizance of cases pending before
administrative agencies of special competence. [17 Note, too, that the plaintiff in
the replevin suit who seeks to recover the shipment from the DENR had not
exhausted the administrative remedies available to him. [18 The prudent thing for
respondent judge to have done was to dismiss the replevin suit outright.
Under Section 78-A of the Revised Forestry Code, the DENR secretary or his
authorized representatives may order the confiscation of forest products illegally
cut, gathered, removed, or possessed or abandoned, including the conveyances
used in the commission of the offense.
In this regard, we declared in Paat v. Court of Appeals:
the enforcement of forestry laws, rules and regulations and the protection,
development and management of forest lands fall within the primary and special
responsibilities of the Department of Environment and Natural Resources. By the
very nature of its function, the DENR should be given a free hand unperturbed by
judicial intrusion to determine a controversy which is well within its jurisdiction. The
assumption by the trial court, therefore, of the replevin suit filed by private
respondents constitutes an unjustified encroachment into the domain of the
administrative agencys prerogative. The doctrine of primary jurisdiction does not
warrant a court to arrogate unto itself the authority to resolve a controversy the
jurisdiction over which is initially lodged with an administrative body of special
competence. xxx[19
Respondent judges act of taking cognizance of the subject replevin suit clearly
demonstrates ignorance of the law. He has fallen short of the standard set forth in
Canon 1, Rule 1.01 of the Code of Judicial Conduct, that a judge must be the
embodiment of competence, integrity, and independence. To measure up to this
standard, judges are expected to keep abreast of all laws and prevailing
jurisprudence. [20 Judges are duty bound to have more than just a cursory
acquaintance with laws and jurisprudence. Failure to follow basic legal commands
constitutes gross ignorance of the law from which no one may be excused, not even
a judge.
We find, however, that respondent judge had already vacated the Writ of Seizure he
issued on March 19, 1998, in a subsequent Order dated November 27, 1998,
dismissing the Civil Complaint for replevin filed by Robert Hernandez against the

Regional Director of the DENR and other officers. He also directed in said order the
sheriff to return to CENRO, Tacloban City, all the chattels confiscated by virtue of the
Writ of Seizure. [22
Further, we find that Sheriff Aguilar in his Final Return of the Writ, dated December
15, 1998, had already delivered to CENRO the 102 tons and 120 kilos of tanbark
duly receipted by CENRO representative Marcial A. Dalimot on the same date. [23
The OCA recommends that respondent judge be fined in the amount of P15,000.00.
Under the circumstances, considering that this is the first complaint against him, we
deem a fine of P10,000.00 to be sufficient.
Regarding the charges against respondent sheriff, we agree with the OCA that they
should be dismissed. Respondent sheriff merely complied with his ministerial duty
to serve the writ with reasonable celerity and to execute it promptly in accordance
with its mandates. [24
WHEREFORE , respondent Judge Frisco T. Lilagan is hereby found liable for gross
ignorance of the law and is accordingly ordered to pay a FINE of P10,000.00, with a
WARNING that a repetition of the same or a similar offense will be dealt with more
severely. The complaint against respondent Sheriff IV Leonardo V. Aguilar is
DISMISSED for lack of merit.
SO ORDERED.

PROSECUTOR LEO C. TABAO vs. JUDGE FRISCO T. LILAGAN and


SHERIFF IV LEONARDO V. AGUILAR [A.M. No. RTJ-01-1651.
September 4, 2001] Case Digest
FACT:

On February 24, 1998, a water craft M/L Hadja, from Bongao, Tawi-tawi, was docked
at the port area of Tacloban City with a load of 100 tons of tanbark. Robert
Hernandez was the consignee to said cargo. While the cargo was being unloaded,
the NBI decided to verify the shipment's accompanying documents where it was
found to be irregular and incomplete. Consequently, the NBI ordered the unloading
of the cargo stopped. As a result, the tanbark, the boat, and three cargo trucks were
seized and impounded.

On March 5, 1998, NBI-EVRO 8 Regional Director Carlos S. Caabay filed a Criminal


Complaint for the violation of Section 68 (now Section 78) of P.D. 705, The Forestry
Code of the Philippines as amended, against the captain and crew of the M/L Hadja,
Robert Hernandez, Tandico Chion, Alejandro K. Bautista, a forster, and Marcial A.
Dalimot, a Community Environment and Natural Resources Officer of the DENR.
Bautista and Dalimot were also charged with violation of Section 3(e) of R.A. No.

3019 or the Anti-Graft and Corrupt Practices Act, along with Habi A. Alih and
Khonrad V. Mohammad of the CENRO-Bongao, Tawi-tawi. The complaint was
docketed as I.S. No. 98-296 at the Prosecutor's Office of Tacloban City.

On March 10, 1998, DENR took possession of the cargo, the boat and the three
trucks, through the previous direction of the complainant. Due notice were issued to
the consignee, Robert Hernandez and the NBI Regional Director.

On March 11, 1998, Hernandez filed in the RTC of Leyte a case for replevin to
recover the items seized by the DENR and was docketed as Civil Case No. 98-03-42.

On March 16, 1998, subpoenas were issued to the respondents in I.S. No. 98-296
and on March 17, 1998, confiscation proceedings were conducted by the PENROLeyte, with both Hernandez and his counsel present.

On March 19, 1998, herein respondent Judge Frisco T. Lilagan issued a writ of
replevin and directed Sheriff IV Leonardo V. Aguilar to take possession of the items
seized by the DENR and to deliver them to Hernandez after the expiration of five
days. Respondent Sheriff served a copy of the writ to the Philippine Coast Guard
station in Tacloban City at around 5:45 p.m. of March 19, 1998.

Thus, the filing of this Administrative complaint against respondent via a letter
addressed to the Chief Justice and dated April 13, 1998, by Atty. Tabao.

Complainant avers that replevin is not available when properties sought to be


recovered are involved in criminal proceedings. He also submits that respondent
judge is either grossly ignorant of the law and jurisprudence or purposely
disregarded them.

Complainant states that the respondent sheriff had the duty to safeguard M/L Hadja
and to prevent it from leaving the port of Tacloban City, after he had served a writ of
seizure therefor on the Philippine Coast Guard. According to the complainant, on
March 19, 1998, the vessel left the port of Tacloban City, either through respondent
sheriff's gross negligence or his direct connivance with interested parties. Moreover,
complainant pointed out that respondent sheriff released the seized tanbark to
Hernandez within the five day period that he was supposed to keep it under the
terms of the writ, thereby effectively altering, suppressing, concealing or destroying
the integrity of said evidence.

Respondent judge claim that the charge of gross ignorance of the law was
premature since there is a pending motion to dismiss filed by the defendants in the
replevin case. Further, he claimed that he was unaware of the existence of I.S. No.
98-296 and upon learning of the same, he issued an order dated March 25, 1998,
suspending the transfer to Hernandez of possession of the subject items, pending
resolution of an urgent manifestation by the complainant. Respondent judges
stresses that the writ of replevin was issued in strict compliance with the
requirements laid down in Rule 60 of the Revised Rule of Court. He also pointed out
that no apprehension report was issued by the NBI regarding the shipment and
neither did the DENR issue a seizure report.

Respondent sheriff submits that he served the writ of replevin on the Coast Guard to
prevent the departure of subject vessel since he does not have the means to
physically prevent the vessel from sailing. He further claimed that he verified the
status of the cargo with DENR and that it came from a legitimate source except that
the shipment documents were not in order. Respondent sheriff contends that it was
his ministerial duty to serve the writ of replevin, absent any instruction to the
contrary.

The Office of the Court Administrator, in a report dated April 8, 1999, recommended
that the judge be fined in the amount of P15,000.00 for gross ignorance of the law
and that the charges against respondent sheriff be dismissed for lack of merit.

ISSUE:

Whether or not the respondent judge was grossly ignorant of the law and
jurisprudence for issuing the writ of replevin.

RULING:

The complaint for replevin states that the shipment of tanbark and the vessel on
which it was loaded were seized by the NBI for verification of supporting documents.
It also stated that the NBI turned over the seized items to the DENR "for official
disposition and appropriate action". These allegations would have been sufficient to
alert the respondent judge that the DENR had custody of the seized items and that
administrative proceedings may have already been commenced concerning the
shipment.

Under the doctrine of primary jurisdiction, the courts cannot take cognizance of
cases pending before administrative agencies of special competence. Also, the
plaintiff in the replevin suit who seeks to recover the shipment from the DENR had
not exhausted the administrative remedies available to him. Prudent thing for the
respondent judge to do was to dismiss the replevin outright.

Under Section 78-A of the Revised Forestry Code, the DENR secretary or his
representatives may order the confiscation of forest products illegally cut, gathered,
removed, possessed or abandoned, including the conveyances involved in the
offense.

It was declared by the Court in Paat vs. Court of Appeals the that enforcement of
forestry laws, rules and regulations and the protection, development and
management of forest lands fall within the primary and special responsibilities of
the DENR. The DENR should be given free hand unperturbed by judicial intrusion to
determine a controversy which is well within its jurisdiction. The court held that the
assumption of the trial court of the replevin suit constitutes an unjustified
encroachment into the domain of the administrative ageny's prerogative. The
doctrine of primary jurisdiction does not warrant a court to arrogate unto itself the
authority to resolve a controversy the jurisdiction over which is initially lodged
within an administrative body of special competence.

The respondent judge's act of taking cognizance of the subject replevin suit clearly
demonstrates ignorance of the law. He has fallen short of the standard set forth in
Canon 1 Rule 1.01 of the Code of Judicial Conduct, that a judge must be an
embodiment of competence, integrity and independence. To measure up to this
standard, justices are expected to keep abreast of all laws and prevailing
jurisprudence. Failure to follow basic legal commands constitutes gross ignorance of
the law from which no one may be excused, not even a judge.

On the charges against respondent sheriff, the Court agreed with the OCA that they
should be dismissed. Respondent sheriff merely complied with his material duty to
serve the writ with reasonable celerity and to execute it promptly in accordance
with the mandates.

Respondent Judge Frisco T. Lilagan was found liable for gross ignorance of the law
and is accordingly ordered to pay a fine of 10,000. 00, with a warning that a
repetition of the same or similar offense will be dealt more severely. The complaint
against respondent Sheriff IV Leonardo V. Aguilar is dismissed for lack of merit.

Arrow Transportation Corp


-vsBoard of Transportation and Sultan Rent-A-Car, Inc.
GR No. L-9655, 21 March 1975
63 SCR 193
FACTS
Petitioner Arrow and private respondent Sultan are both domestic
corporations. Petitioner is a holder of a Certificate of Public Convenience to operate
a public utility bus. Private respondent applied for the issuance of a CPC to operate
a similar service. Without the required publication, public respondent Board granted
a provisional permit to operate. Petitioner moved for reconsideration and
cancellation of the provisional permit. Before resolution of the motion, petitioner
filed for herein petition arguing that there must be publication before a provisional
permit can be issued, with reference made to PD 101, which authorized the Board to
grant provisional permits when warranted.

ISSUE
Whether or not the issuance of the provisional permit was legal.

HELD
The Court held in the affirmative. For a provisional permit to operate a public
utility, an ex parte hearing would suffice. The decisive consideration is the existence
of public need. That was shown in this case, respondent Board, on the basis of
demonstrable data, being satisfied of the pressing necessity for the grant of the
provisional permit sought.

Petition dismissed.

G.R. No. 85439 January 13, 1992


KBMBPM
vs.

HON. CARLOS G. DOMINGUEZ,


Facts:

On 2 September 1985, the Municipality of Muntinlupa, thru its then Mayor Santiago
Carlos, Jr., entered into a contract with the KILUSANG BAYAN, represented by its
General Manager, Amado Perez, for the latter's management and operation of the
new Muntinlupa public market. The contract provides for a twenty-five (25) year
term commencing on 2 September 1985, renewable for a like period, unless sooner
terminated and/or rescinded by mutual agreement of the parties, at a monthly
consideration of Thirty-Five Thousand Pesos (P35,000) to be paid by the KBMBPM
within the first five (5) days of each month which shall, however, be increased by
ten percent (10%) each year during the first five (5) years only.
Following his assumption into office as the new mayor, Ignacio Bunye, claiming to
be particularly scandalized by the "virtual 50-year term of the agreement, contrary
to law and the "patently inequitable rental," directed a review of the aforesaid
contract. He sought opinions from both the Commission on Audit and the Metro
Manila Commission (MMC) on the validity of the instrument. In separate letters,
these agencies urged that appropriate legal steps be taken towards its rescission.
The MMC even granted the Municipality authority "to take the necessary legal steps
for the cancellation/recission of the above cited contract and make representations
with KBMBPM for the immediate transfer/takeover of the possession, management
and operation of the New Muntinlupa Market to the Municipal Government of
Muntinlupa. Consequently, upon representations made by Bunye with the
Municipal Council, the latter approved on 1 August 1988 a Resolution abrogating the
contract. To implement this resolution, Bunye, together with his co-petitioners and
elements of the Philippine Constabulary, proceeded, on 19 August 1986, to the
public market and announced to the general public and the stallholders thereat that
the Municipality was taking over the management and operation of the facility, and
that the stallholders should henceforth pay their market fees to the Municipality,
thru the Market Commission, and no longer to the KBMBPM.
On 22 August 1988, the KBMBPM filed with the Regional Trial Court of Makati a
complaint for breach of contract, specific performance and damages with prayer for
a writ of preliminary injunction against the Municipality and its officers. The
complaint was premised on the alleged illegal take-over of the public market
effected "in excess of his (Bunye's) alleged authority" and thus "constitutes breach
of contract and duty as a public official."
The writ applied for having been denied, the KBMBPM officers resisted the attempts
of Bunye and company to complete the take-over; they continued holding office in
the KBS building, under their respective official capacities.
In the early morning of 29 October 1988, respondents, allegedly accompanied by
Mayor Bunye and the latters' heavily armed men, both in uniform and in civilian
clothes, together with other civilians, and other unidentified persons, allegedly

through force, violence and intimidation, forcibly broke open the doors of the offices
of petitioners located at the second floor of the KBS Building, new Muntinlupa Public
Market, purportedly to serve upon petitioners the Order of respondent Secretary of
Agriculture dated 28 October 1988, and to implement the same, by taking over and
assuming the management of KBMBPM, disbanding the then incumbent Board of
Directors for that purpose and excluding and prohibiting the General Manager and
the other officers from exercising their lawful functions as such. Such Order from the
Sec. of Agriculture claimed to draw its power from PD 175 (the old Cooperative
Movement Decree) giving the Secretary of Agriculture power to regulate
cooperatives.

Issue:
Whether or not suit brought by KBMBPM is premature due to non-exhaustion of
administrative remedies, on the ground that KBMBPM should have petitioned
directly the Secretary of Agriculture to reverse the Order stripping the KBMBPM
Board of its authority

Ruling:
NO. Petitioners have the personality to file the instant petition and ask, in effect, for
their reinstatement as Section 3, Rule 65 of the Rules of Court, defining an action for
mandamus, permits a person who has been excluded from the use and enjoyment
of a right or office to which he is entitled, to file suit. Petitioners, as ousted directors
of the KBMBPM, are questioning precisely the act of respondent Secretary in
disbanding the board of directors; they then pray that this Court restore them to
their prior stations.

As to failure to exhaust administrative remedies, the rule is well-settled that this


requirement does not apply where the respondent is a department secretary whose
acts, as an alter ego of the President, bear the implied approval of the latter, unless
actually disapproved by him. This doctrine of qualified political agency ensures
speedy access to the courts when most needed. There was no need then to appeal
the decision to the office of the President; recourse to the courts could be had
immediately. Moreover, the doctrine of exhaustion of administrative remedies also
yields to other exceptions, such as when the question involved is purely legal, as in
the instant case, or where the questioned act is patently illegal, arbitrary or
oppressive. Such is the claim of petitioners which, as hereinafter shown, is correct.

G.R. No. L-65718

June 30, 1987

NATIONAL DEVELOPMENT COMPANY AND DOLE PHILIPPINES, INC.,


petitioners,
vs.
WILFREDO HERVILLA, respondent.
Assailed in this petition for review on certiorari is the decision 1 dated 10 November
1983 of the Intermediate Appellate Court (now Court of Appeals) in AC-G.R. No. CV66215 entitled, "Wilfredo Hervilla, Plaintiff-Appellant, versus Dole Philippines, Inc.,
Candido de Pedro, and National Development Co., Defendants-Appelleea, "which
reversed the decision of the Court of First Instance of South Cotabato, General
Santos City, as well as its resolution dated 9 August 1985 denying the motion for
reconsideration of said decision.

The facts of the case, as gathered from the decision under review, are as follows:

An action for Recovery of Possession and Damages filed on December 20, 1973 by
Wilfredo Hervilla against Dole Philippines, a duly registered corporation doing
business in Polomolok, South Cotabato, involving Lots Nos. 3284, and 3283, GSS269-D, each containing four (4) hectares, more or less, situated at Sitio Bahsong,
Palkan, Polomolok, South Cotabato, now in the possession of defendant corporation
as Administrator of the properties of National Development Corporation (NDC)
impleaded as party defendant (Records, p. 48).

Moreover, records do not show that private respondent Wilfredo Hervilla ever filed a
motion for reconsideration of the decision of the Director of Lands issuing free
patent over the lands in dispute in favor of petitioners' predecessor-in-interest.
Neither did he appeal said decision to the Secretary of Agriculture and Natural
Resources, nor did he appeal to the office of the President of the Philippines. In
short, Hervilla failed to exhaust administrative remedies, a flaw which, to our mind,
is fatal to a court review. The decision of the Director of Lands has now become
final. The Courts may no longer interfere with such decision. 16

WHEREFORE, the decision dated 10 November 1983 and the resolution dated 9
August 1985 of the respondent Appellate Court are hereby reversed and set aside.
The decision of the court a quo dated 28 February 1979 is hereby ordered
reinstated. No costs.