.R. No.
197380, October 08, 2014
ELIZA ZUIGA-SANTOS,* REPRESENTED BY HER ATTORNEY-IN FACT,
NYMPHA Z. SALES, Petitioners, v. MARIA DIVINA GRACIA SANTOS-
GRAN** AND REGISTER OF DEEDS OF MARIKINA CITY, Respondents.
DECISION
PERLAS-BERNABE, J.:
Before the Court is a petition for review on certiorari1 assailing the
Decision2 dated January 10, 2011 and the Resolution3 dated June 22, 2011
of the Court of Appeals (CA) in CA-G.R. CV No. 87849 which affirmed the
Order4 dated July 6, 2006 of the Regional Trial Court of San Mateo, Rizal,
Branch 76 (RTC) in Civil Case No. 2018-06, dismissing the Amended
Complaint for annulment of sale and revocation of title on the ground of
insufficiency of factual basis.
The Facts
On January 9, 2006, petitioner Eliza Zuiga-Santos (petitioner), through her
authorized representative, Nympha Z. Sales, 5 filed a Complaint6 for
annulment of sale and revocation of title against respondents Maria Divina
Gracia Santos-Gran (Gran) and the Register of Deeds of Marikina City
before the RTC, docketed as Civil Case No. 2018-06. The said complaint
was later amended7 on March 10, 2006 (Amended Complaint).
In her Amended Complaint,8 petitioner alleged, among others, that: (a) she
was the registered owner of three (3) parcels of land located in the
Municipality of Montalban, Province of Rizal, covered by Transfer Certificate
of Title (TCT) Nos. N-5500, 9 224174,10 and N-423411 (subject properties)
prior to their transfer in the name of private respondent Gran; (b) she has a
second husband by the name of Lamberto C. Santos (Lamberto), with
whom she did not have any children; (c) she was forced to take care of
Lambertos alleged daughter, Gran, whose birth certificate was forged to
make it appear that the latter was petitioners daughter; (d) pursuant to
void and voidable documents, i.e., a Deed of Sale, Lamberto succeeded in
transferring the subject properties in favor of and in the name of Gran; (e)
despite diligent efforts, said Deed of Sale could not be located; and (f) she
discovered that the subject properties were transferred to Gran sometime
in November 2005. Accordingly, petitioner prayed, inter alia, that Gran
surrender to her the subject properties and pay damages, including costs
of suit.12cralawlawlibrary
For her part, Gran filed a Motion to Dismiss, 13 contending, inter alia, that
(a) the action filed by petitioner had prescribed since an action upon a
written contract must be brought within ten (10) years from the time the
cause of action accrues, or in this case, from the time of registration of the
questioned documents before the Registry of Deeds; 14 and (b) the
Amended Complaint failed to state a cause of action as the void and
voidable documents sought to be nullified were not properly identified nor
the substance thereof set forth, thus, precluding the RTC from rendering a
valid judgment in accordance with the prayer to surrender the subject
properties.15cralawlawlibrary
The RTC Ruling
In an Order16 dated July 6, 2006, the RTC granted Grans motion and
dismissed the Amended Complaint for its failure to state a cause of action,
considering that the deed of sale sought to be nullified an essential and
indispensable part of [petitioners] cause of action 17 was not attached. It
likewise held that the certificates of title covering the subject properties
cannot be collaterally attacked and that since the action was based on a
written contract, the same had already prescribed under Article 1144 of
the Civil Code.18cralawlawlibrary
Dissatisfied, petitioner elevated the matter to the CA.
The CA Ruling
In a Decision19 dated January 10, 2011, the CA sustained the dismissal of
petitioners Amended Complaint but on the ground of insufficiency of
factual basis.
It disagreed with the RTCs finding that the said pleading failed to state a
cause of action since it had averred that: (a) petitioner has a right over the
subject properties being the registered owner thereof prior to their transfer
in the name of Gran; (b) Lamberto succeeded in transferring the subject
properties to his daughter, Gran, through void and voidable documents;
and (c) the latters refusal and failure to surrender to her the subject
properties despite demands violated petitioners rights over them. 20 The
CA likewise ruled that the action has not yet prescribed since an action for
nullity of void deeds of conveyance is imprescriptible. 21 Nonetheless, it
held that since the Deed of Sale sought to be annulled was not attached to
the Amended Complaint, it was impossible for the court to determine
whether petitioners signature therein was a forgery and thus, would have
no basis to order the surrender or reconveyance of the subject
properties.22cralawlawlibrary
Aggrieved, petitioner moved for reconsideration 23 and attached, for the
first time, a copy of the questioned Deed of Sale24 which she claimed to
have recently recovered, praying that the order of dismissal be set aside
and the case be remanded to the RTC for further proceedings.
In a Resolution25 dated June 22, 2011, the CA denied petitioners motion
and held that the admission of the contested Deed of Sale at this late
stage would be contrary to Grans right to due process.
Hence, the instant petition.
The Issue Before the Court
The primordial issue for the Courts resolution is whether or not the
dismissal of petitioners Amended Complaint should be sustained.
The Courts Ruling
Failure to state a cause of action and lack of cause of action are distinct
grounds to dismiss a particular action. The former refers to the
insufficiency of the allegations in the pleading, while the latter to the
insufficiency of the factual basis for the action. Dismissal for failure to state
a cause of action may be raised at the earliest stages of the proceedings
through a motion to dismiss under Rule 16 of the Rules of Court, while
dismissal for lack of cause of action may be raised any time after the
questions of fact have been resolved on the basis of stipulations,
admissions or evidence presented by the plaintiff. 26 In Macaslang v.
Zamora,27 the Court, citing the commentary of Justice Florenz D. Regalado,
explained:chanRoblesvirtualLawlibrary
Justice Regalado, a recognized commentator on remedial law, has
explained the distinction:chanroblesvirtuallawlibrary
x x x What is contemplated, therefore, is a failure to state a cause of action
which is provided in Sec. 1(g) of Rule 16. This is a matter of insufficiency of
the pleading. Sec. 5 of Rule 10, which was also included as the last mode
for raising the issue to the court, refers to the situation where the
evidence does not prove a cause of action. This is, therefore, a matter of
insufficiency of evidence. Failure to state a cause of action is different from
failure to prove a cause of action. The remedy in the first is to move for
dismissal of the pleading, while the remedy in the second is to demur to
the evidence, hence reference to Sec. 5 of Rule 10 has been eliminated in
this section. The procedure would consequently be to require the pleading
to state a cause of action, by timely objection to its deficiency; or, at the
trial, to file a demurrer to evidence, if such motion is warranted. 28
In the case at bar, both the RTC and the CA were one in dismissing
petitioners Amended Complaint, but varied on the grounds thereof that
is, the RTC held that there was failure to state a cause of action while the
CA ruled that there was insufficiency of factual basis.
At once, it is apparent that the CA based its dismissal on an incorrect
ground. From the preceding discussion, it is clear that insufficiency of
factual basis is not a ground for a motion to dismiss. Rather, it is a ground
which becomes available only after the questions of fact have been
resolved on the basis of stipulations, admissions or evidence presented by
the plaintiff. The procedural recourse to raise such ground is a demurrer to
evidence taken only after the plaintiffs presentation of evidence. This
parameter is clear under Rule 33 of the Rules of
Court:chanRoblesvirtualLawlibrary
RULE 33
Demurrer to Evidence
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.
At the preliminary stages of the proceedings, without any presentation of
evidence even conducted, it is perceptibly impossible to assess the
insufficiency of the factual basis on which the plaintiff asserts his cause of
action, as in this case. Therefore, that ground could not be the basis for the
dismissal of the action.
However, the Amended Complaint is still dismissible but on the ground of
failure to state a cause of action, as correctly held by the RTC. Said ground
was properly raised by Gran in a motion to dismiss pursuant to Section 1,
Rule 16 of the Rules of Court:chanRoblesvirtualLawlibrary
RULE 16
Motion to Dismiss
Section 1. Grounds. Within the time for but before filing the answer to
the complaint or pleading asserting a claim, a motion to dismiss may be
made on any of the following grounds:chanRoblesvirtualLawlibrary
x x x x
(g) That the pleading asserting the claim states no cause of action;
xxxx
A complaint states a cause of action if it sufficiently avers the existence of
the three (3) essential elements of a cause of action, namely: (a) a right in
favor of the plaintiff by whatever means and under whatever law it arises
or is created; (b) an obligation on the part of the named defendant to
respect or not to violate such right; and (c) an act or omission on the part
of the named defendant violative of the right of the plaintiff or constituting
a breach of the obligation of defendant to the plaintiff for which the latter
may maintain an action for recovery of damages. 29 If the allegations of the
complaint do not state the concurrence of these elements, the complaint
becomes vulnerable to a motion to dismiss on the ground of failure to state
a cause of action.30cralawlawlibrary
It is well to point out that the plaintiffs cause of action should not merely
be stated but, importantly, the statement thereof should be sufficient.
This is why the elementary test in a motion to dismiss on such ground is
whether or not the complaint alleges facts which if true would justify the
relief demanded.31 As a corollary, it has been held that only ultimate facts
and not legal conclusions or evidentiary facts are considered for purposes
of applying the test. 32 This is consistent with Section 1, Rule 8 of the Rules
of Court which states that the complaint need only allege the ultimate
facts or the essential facts constituting the plaintiffs cause of action. A fact
is essential if they cannot be stricken out without leaving the statement of
the cause of action inadequate. 33 Since the inquiry is into the sufficiency,
not the veracity, of the material allegations, it follows that the analysis
should be confined to the four corners of the complaint, and no
other.34cralawlawlibrary
A judicious examination of petitioners Amended Complaint readily shows
its failure to sufficiently state a cause of action. Contrary to the findings of
the CA, the allegations therein do not proffer ultimate facts which would
warrant an action for nullification of the sale and recovery of the properties
in controversy, hence, rendering the same dismissible.
 11.
While the Amended Complaint does allege that petitioner was the
registered owner of the subject properties in dispute, nothing in the said
pleading or its annexes would show the basis of that assertion, either
through statements/documents tracing the root of petitioners title or
copies of previous certificates of title registered in her name. Instead, the
certificates of title covering the said properties that were attached to the
Amended Complaint are in the name of Gran. At best, the attached copies
of TCT Nos. N-5500 and N-4234 only mention petitioner as the
representative of Gran at the time of the covered propertys registration
when she was a minor. Nothing in the pleading, however, indicates that the
former had become any of the properties owner. This leads to the logical
conclusion that her right to the properties in question at least through the
manner in which it was alleged in the Amended Complaint remains
ostensibly unfounded. Indeed, while the facts alleged in the complaint are
hypothetically admitted for purposes of the motion, it must, nevertheless,
be remembered that the hypothetical admission extends only to the
relevant and material facts well pleaded in the complaint as well as to
inferences fairly deductible therefrom.35 Verily, the filing of the motion to
dismiss assailing the sufficiency of the complaint does not hypothetically
admit allegations of which the court will take judicial notice of to be not
true, nor does the rule of hypothetical admission apply to legally
impossible facts, or to facts inadmissible in evidence, or to facts that
appear to be unfounded by record or document included in the
pleadings.36cralawlawlibrary
Aside from the insufficiency of petitioners allegations with respect to her
right to the subject properties sought to be recovered, the ultimate facts
supposedly justifying the annulment of sale, by which the reconveyance
of the subject properties is sought, were also insufficiently pleaded. The
following averments in the Amended Complaint betray no more than an
insufficient narration of facts:chanRoblesvirtualLawlibrary
6. That pursuant to a voidable [sic] and void documents, the second
husband of the plaintiff succeed [sic] in transferring the above TITLES in
the name of MARIA DIVINAGRACIA SANTOS, who is (sic) alleged daughter
of LAMBERTO C. SANTOS in violation of Article 1409, Par. 2 of the Civil
Code;
7. That the said properties [were] transferred to the said defendant
by a Deed of Sale (DOS) to the said MARIA DIVINAGRACIA SANTOS through
a void documents [sic] considering that the seller is the alleged mother of
defendant is also the buyer of the said properties in favor of defendant;
8. x x x.
9. That the alleged sale and transfer of the said properties in favor of
defendant was only discovered by [plaintiffs] daughter CYNTHIA BELTRAN-
LASMARIAS when [plaintiff] has been requesting for financial assistance,
considering that the said mother of plaintiff [sic] has so many properties
which is now the subject of this complaint;
10. That plaintiff then return on [to] the Philippines sometime [in]
November, 2005 and discovered that all [plaintiffs] properties [had] been
transferred to defendant MARIA DIVINAGRACIA SANTOS who is not a
daughter either by consanguinity or affinity to the plaintiff mother [sic];
That the titles that [were] issued in the name of MARIA
DIVINAGRACIA SANTOS by virtue of the said alleged voidable and void
documents, should be annulled and cancelled as the basis of the transfer is
through void and voidable documents;
x x x x37
Clearly, the claim that the sale was effected through voidable and void
documents partakes merely of a conclusion of law that is not supported
by any averment of circumstances that will show why or how such
conclusion was arrived at. In fact, what these voidable and void
documents are were not properly stated and/or identified. In Abad v.
Court of First Instance of Pangasinan, 38 the Court pronounced
that:chanRoblesvirtualLawlibrary
A pleading should state the ultimate facts essential to the rights
of action or defense asserted, as distinguished from mere
conclusions of fact, or conclusions of law. General allegations that a
contract is valid or legal, or is just, fair, and reasonable, are mere
conclusions of law. Likewise, allegations that a contract is void,
voidable, invalid, illegal, ultra vires, or against public policy, without
stating facts showing its invalidity, are mere conclusions of
law.39 (Emphases supplied)
Hence, by merely stating a legal conclusion, the Amended Complaint
presented no sufficient allegation upon which the Court could grant the
relief petitioner prayed for. Thus, said pleading should be dismissed on the
ground of failure to state cause of action, as correctly held by the RTC.
That a copy of the Deed of Sale adverted to in the Amended Complaint was
subsequently submitted by petitioner does not warrant a different course
of action. The submission of that document was made, as it was
purportedly recently recovered, only on reconsideration before the CA
which, nonetheless, ruled against the remand of the case. An examination
of the present petition, however, reveals no counter-argument against the
foregoing actions; hence, the Court considers any objection thereto as
waived.
In any event, the Court finds the Amended Complaints dismissal to be in
order considering that petitioners cause of action had already prescribed.
It is evident that petitioner ultimately seeks for the reconveyance to her of
the subject properties through the nullification of their supposed sale to
Gran. An action for reconveyance is one that seeks to transfer property,
wrongfully registered by another, to its rightful and legal owner. 40 Having
alleged the commission of fraud by Gran in the transfer and registration of
the subject properties in her name, there was, in effect, an implied trust
created by operation of law pursuant to Article 1456 of the Civil Code
which provides:chanRoblesvirtualLawlibrary
Art. 1456. If property is acquired through mistake or fraud, the person
obtaining it is, by force of law, considered a trustee of an implied trust for
the benefit of the person from whom the property comes.

To determine when the prescriptive period commenced in an action for
reconveyance, the plaintiffs possession of the disputed property is
material. If there is an actual need to reconvey the property as
when the plaintiff is not in possession, the action for
reconveyance based on implied trust prescribes in ten (10) years,
the reference point being the date of registration of the deed or
the issuance of the title. On the other hand, if the real owner of the
property remains in possession of the property, the prescriptive period to
recover title and possession of the property does not run against him and
in such case, the action for reconveyance would be in the nature of a suit
for quieting of title which is imprescriptible. 41cralawlawlibrary
In the case at bar, a reading of the allegations of the Amended Complaint
failed to show that petitioner remained in possession of the subject
properties in dispute. On the contrary, it can be reasonably deduced that
it was Gran who was in possession of the subject properties, there being an
admission by the petitioner that the property covered by TCT No. 224174
was being used by Grans mother-in-law. 42 In fact, petitioners relief in the
Amended Complaint for the surrender of three (3) properties to her
bolsters such stance.43 And since the new titles to the subject properties in
the name of Gran were issued by the Registry of Deeds of Marikina on the
following dates: TCT No. 224174 on July 27, 1992, 44TCT No. N-5500 on
January 29, 1976,45 and TCT No. N-4234 on November 26, 1975, 46 the filing
of the petitioners complaint before the RTC on January 9, 2006 was
obviously beyond the ten-year prescriptive period, warranting the
Amended Complaints dismissal all the same.
WHEREFORE, the petition is DENIED. The Decision dated January 10,
2011 and the Resolution dated June 22, 2011 of the Court of Appeals in CA-
G.R. CV No. 87849 are hereby AFFIRMED with MODIFICATION in that the
Amended Complaint be dismissed on the grounds of (a) failure to state a
cause of action, and (b) prescription as herein discussed.
SO ORDERED.cralawred
FELS ENERGY, INC., G.R. No. 168557
Petitioner,
-versus-
THE PROVINCE OF BATANGAS and
THE OFFICE OF THE PROVINCIAL
ASSESSOR OF BATANGAS,
Respondents.
x----------------------------------------------------x
NATIONAL POWER CORPORATION, G.R. No. 170628
Petitioner,
Present:
YNARES-SANTIAGO, J.,
- versus - Chairperson,
AUSTRIA-MARTINEZ,
CALLEJO, SR. and
LOCAL BOARD OF ASSESSMENT CHICO-NAZARIO, JJ.
APPEALS OF BATANGAS, LAURO C.
ANDAYA, in his capacity as the Assessor
of the Province of Batangas, and the Promulgated:
PROVINCE OF BATANGAS represented
by its Provincial Assessor, February 16, 2007
Respondents.
x--------------------------------------------------------------------------------------------x
DECISION
CALLEJO, SR., J.:
Before us are two consolidated cases docketed as G.R. No. 168557 and
G.R. No. 170628, which were filed by petitioners FELS Energy, Inc. (FELS)
and National Power Corporation (NPC), respectively. The first is a petition
for review on certiorari assailing the August 25, 2004 Decision [1] of the
Court of Appeals (CA) in CA-G.R. SP No. 67490 and its
Resolution[2] dated June 20, 2005; the second, also a petition for review
on certiorari, challenges the February 9, 2005 Decision[3] and November 23,
2005 Resolution[4] of the CA in CA-G.R. SP No. 67491. Both petitions were
dismissed on the ground of prescription.
The pertinent facts are as follows:
On January 18, 1993, NPC entered into a lease contract with Polar Energy,
Inc. over 3x30 MW diesel engine power barges moored at Balayan Bay in
Calaca, Batangas. The contract, denominated as an Energy Conversion
Agreement[5] (Agreement), was for a period of five years. Article 10 reads:
10.1 RESPONSIBILITY. NAPOCOR shall be responsible for the
payment of (a) all taxes, import duties, fees, charges and other levies
imposed by the National Government of the Republic of the Philippines or
any agency or instrumentality thereof to which POLAR may be or become
subject to or in relation to the performance of their obligations under this
agreement (other than (i) taxes imposed or calculated on the basis of the
net income of POLAR and Personal Income Taxes of its employees and (ii)
construction permit fees, environmental permit fees and other similar fees
and charges) and (b) all real estate taxes and assessments, rates and
other charges in respect of the Power Barges.[6]
Subsequently, Polar Energy, Inc. assigned its rights under the Agreement
to FELS. The NPC initially opposed the assignment of rights, citing
paragraph 17.2 of Article 17 of the Agreement.
On August 7, 1995, FELS received an assessment of real property taxes on
the power barges from Provincial Assessor Lauro C. Andaya
of Batangas City. The assessed tax, which likewise covered those due for
1994, amounted to P56,184,088.40 per annum. FELS referred the matter to
NPC, reminding it of its obligation under the Agreement to pay all real
estate taxes. It then gave NPC the full power and authority to represent it
in any conference regarding the real property assessment of the Provincial
Assessor.
In a letter[7] dated September 7, 1995, NPC sought reconsideration of the
Provincial Assessors decision to assess real property taxes on the power
barges. However, the motion was denied on September 22, 1995, and the
Provincial Assessor advised NPC to pay the assessment. [8] This prompted
NPC to file a petition with the Local Board of Assessment Appeals (LBAA)
for the setting aside of the assessment and the declaration of the barges
as non-taxable items; it also prayed that should LBAA find the barges to be
taxable, the Provincial Assessor be directed to make the necessary
corrections.[9]
In its Answer to the petition, the Provincial Assessor averred that the
barges were real property for purposes of taxation under Section 199(c) of
Republic Act (R.A.) No. 7160.
Before the case was decided by the LBAA, NPC filed a Manifestation,
informing the LBAA that the Department of Finance (DOF) had rendered an
opinion[10] dated May 20, 1996, where it is clearly stated that power barges
are not real property subject to real property assessment.
On August 26, 1996, the LBAA rendered a Resolution[11] denying the
petition. The fallo reads:
WHEREFORE, the Petition is DENIED. FELS is hereby ordered to pay the real
estate tax in the amount of P56,184,088.40, for the year 1994.
SO ORDERED.[12]
The LBAA ruled that the power plant facilities, while they may be classified
as movable or personal property, are nevertheless considered real property
for taxation purposes because they are installed at a specific location with
a character of permanency. The LBAA also pointed out that the owner of
the bargesFELS, a private corporationis the one being taxed, not NPC. A
mere agreement making NPC responsible for the payment of all real estate
taxes and assessments will not justify the exemption of FELS; such a
privilege can only be granted to NPC and cannot be extended to FELS.
Finally, the LBAA also ruled that the petition was filed out of time.
Aggrieved, FELS appealed the LBAAs ruling to the Central Board of
Assessment Appeals (CBAA).
On August 28, 1996, the Provincial Treasurer of Batangas City issued a
Notice of Levy and Warrant by Distraint [13] over the power barges, seeking
to collect real property taxes amounting to P232,602,125.91 as of July 31,
1996. The notice and warrant was officially served to FELS on November 8,
1996. It then filed a Motion to Lift Levy dated November 14, 1996, praying
that the Provincial Assessor be further restrained by the CBAA from
enforcing the disputed assessment during the pendency of the appeal.
On November 15, 1996, the CBAA issued an Order [14] lifting the levy and
distraint on the properties of FELS in order not to preempt and render
ineffectual, nugatory and illusory any resolution or judgment which the
Board would issue.
Meantime, the NPC filed a Motion for Intervention [15] dated August 7,
1998 in the proceedings before the CBAA. This was approved by the CBAA
in an Order[16] dated September 22, 1998.
During the pendency of the case, both FELS and NPC filed several motions
to admit bond to guarantee the payment of real property taxes assessed
by the Provincial Assessor (in the event that the judgment be unfavorable
to them). The bonds were duly approved by the CBAA.
On April 6, 2000, the CBAA rendered a Decision [17] finding the power barges
exempt from real property tax. The dispositive portion reads:
WHEREFORE, the Resolution of the Local Board of Assessment Appeals of
the Province of Batangas is hereby reversed. Respondent-appellee
Provincial Assessor of the Province of Batangas is hereby ordered to drop
subject property under ARP/Tax Declaration No. 018-00958 from the List of
Taxable Properties in the Assessment Roll. The Provincial Treasurer of
Batangas is hereby directed to act accordingly.
SO ORDERED.[18]
Ruling in favor of FELS and NPC, the CBAA reasoned that the power barges
belong to NPC; since they are actually, directly and exclusively used by it,
the power barges are covered by the exemptions under Section 234(c) of
R.A. No. 7160.[19] As to the other jurisdictional issue, the CBAA ruled that
prescription did not preclude the NPC from pursuing its claim for tax
exemption in accordance with Section 206 of R.A. No. 7160. The Provincial
Assessor filed a motion for reconsideration, which was opposed by FELS
and NPC.
In a complete volte face, the CBAA issued a Resolution [20] on July 31,
2001 reversing its earlier decision. The fallo of the resolution reads:
WHEREFORE, premises considered, it is the resolution of this Board that:
(a) The decision of the Board dated 6 April 2000 is hereby
reversed.
(b) The petition of FELS, as well as the intervention of NPC, is
dismissed.
(c) The resolution of the Local Board of Assessment Appeals of
Batangas is hereby affirmed,

(d) The real property tax assessment on FELS by the Provincial
Assessor of Batangas is likewise hereby affirmed.
SO ORDERED.[21]
FELS and NPC filed separate motions for reconsideration, which were
timely opposed by the Provincial Assessor. The CBAA denied the said
motions in a Resolution[22] dated October 19, 2001.
Dissatisfied, FELS filed a petition for review before the CA docketed as CA-
G.R. SP No. 67490. Meanwhile, NPC filed a separate petition, docketed as
CA-G.R. SP No. 67491.
On January 17, 2002, NPC filed a Manifestation/Motion for Consolidation in
CA-G.R. SP No. 67490 praying for the consolidation of its petition with CA-
G.R. SP No. 67491. In a Resolution [23] dated February 12, 2002, the
appellate court directed NPC to re-file its motion for consolidation with CA-
G.R. SP No. 67491, since it is the ponente of the latter petition who should
resolve the request for reconsideration.
NPC failed to comply with the aforesaid resolution. On August 25, 2004, the
Twelfth Division of the appellate court rendered judgment in CA-G.R. SP No.
67490 denying the petition on the ground of prescription. The decretal
portion of the decision reads:
WHEREFORE, the petition for review is DENIED for lack of merit and the
assailed Resolutions dated July 31, 2001 and October 19, 2001 of the
Central Board of Assessment Appeals are AFFIRMED.
SO ORDERED.[24]
On September 20, 2004, FELS timely filed a motion for reconsideration
seeking the reversal of the appellate courts decision in CA-G.R. SP No.
67490.
Thereafter, NPC filed a petition for review dated October 19, 2004 before
this Court, docketed as G.R. No. 165113, assailing the appellate courts
decision in CA-G.R. SP No. 67490. The petition was, however, denied in this
Courts Resolution[25] of November 8, 2004, for NPCs failure to sufficiently
show that the CA committed any reversible error in the challenged
decision. NPC filed a motion for reconsideration, which the Court denied
with finality in a Resolution[26] dated January 19, 2005.
Meantime, the appellate court dismissed the petition in CA-G.R. SP No.
67491. It held that the right to question the assessment of the Provincial
Assessor had already prescribed upon the failure of FELS to appeal the
disputed assessment to the LBAA within the period prescribed by law.
Since FELS had lost the right to question the assessment, the right of the
Provincial Government to collect the tax was already absolute.
NPC filed a motion for reconsideration dated March 8, 2005, seeking
reconsideration of the February 5, 2005 ruling of the CA in CA-G.R. SP No.
67491. The motion was denied in a Resolution [27] dated November 23,
2005.
The motion for reconsideration filed by FELS in CA-G.R. SP No. 67490 had
been earlier denied for lack of merit in a Resolution[28] dated June 20, 2005.
On August 3, 2005, FELS filed the petition docketed as G.R. No. 168557
before this Court, raising the following issues:
A.
Whether power barges, which are floating and movable, are personal
properties and therefore, not subject to real property tax.
B.
Assuming that the subject power barges are real properties, whether they
are exempt from real estate tax under Section 234 of the Local
Government Code (LGC).
C.
Assuming arguendo that the subject power barges are subject to real
estate tax, whether or not it should be NPC which should be made to pay
the same under the law.
D.
Assuming arguendo that the subject power barges are real properties,
whether or not the same is subject to depreciation just like any other
personal properties.
E.
Whether the right of the petitioner to question the patently null and void
real property tax assessment on the petitioners personal properties is
imprescriptible.[29]
On January 13, 2006, NPC filed its own petition for review before this Court
(G.R. No. 170628), indicating the following errors committed by the CA:
I
THE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT THE APPEAL TO
THE LBAA WAS FILED OUT OF TIME.
II
THE COURT OF APPEALS GRAVELY ERRED IN NOT HOLDING THAT THE
POWER BARGES ARE NOT SUBJECT TO REAL PROPERTY TAXES.

III
THE COURT OF APPEALS GRAVELY ERRED IN NOT HOLDING THAT THE
ASSESSMENT ON THE POWER BARGES WAS NOT MADE IN ACCORDANCE
WITH LAW.[30]
Considering that the factual antecedents of both cases are similar, the
Court ordered the consolidation of the two cases in a properties falls within its power to assess properties for taxation purposes
Resolution[31] dated March 8, 2006.
In an earlier Resolution dated February 1, 2006, the Court had required the
parties to submit their respective Memoranda within 30 days from notice.
Almost a year passed but the parties had not submitted their respective
memoranda. Considering that taxesthe lifeblood of our economyare
involved in the present controversy, the Court was prompted to dispense
with the said pleadings, with the end view of advancing the interests of
justice and avoiding further delay.
In both petitions, FELS and NPC maintain that the appeal before the LBAA
was not time-barred. FELS argues that when NPC moved to have the
assessment reconsidered on September 7, 1995, the running of the period
to file an appeal with the LBAA was tolled. For its part, NPC posits that the
60-day period for appealing to the LBAA should be reckoned from its
receipt of the denial of its motion for reconsideration.
Petitioners contentions are bereft of merit.
Section 226 of R.A. No. 7160, otherwise known as the Local Government
Code of 1991, provides:
SECTION 226. Local Board of Assessment Appeals. Any owner or
person having legal interest in the property who is not satisfied with the
action of the provincial, city or municipal assessor in the assessment of his
property may, within sixty (60) days from the date of receipt of the written
notice of assessment, appeal to the Board of Assessment Appeals of the
province or city by filing a petition under oath in the form prescribed for
the purpose, together with copies of the tax declarations and such
affidavits or documents submitted in support of the appeal.
We note that the notice of assessment which the Provincial Assessor sent
to FELS on August 7, 1995, contained the following statement:
If you are not satisfied with this assessment, you may, within sixty (60)
days from the date of receipt hereof, appeal to the Board of Assessment
Appeals of the province by filing a petition under oath on the form
prescribed for the purpose, together with copies of ARP/Tax Declaration
and such affidavits or documents submitted in support of the appeal. [32]
Instead of appealing to the Board of Assessment Appeals (as stated in the
notice), NPC opted to file a motion for reconsideration of the Provincial
Assessors decision, a remedy not sanctioned by law.
The remedy of appeal to the LBAA is available from an adverse ruling or
action of the provincial, city or municipal assessor in the assessment of the
property. It follows then that the determination made by the respondent
Provincial Assessor with regard to the taxability of the subject real
subject to appeal before the LBAA.[33]
We fully agree with the rationalization of the CA in both CA-G.R. SP No.
67490 and CA-G.R. SP No. 67491. The two divisions of the appellate court
cited the case of Callanta v. Office of the Ombudsman,[34] where we ruled
that under Section 226 of R.A. No 7160, [35] the last action of the local
assessor on a particular assessment shall be the notice of assessment; it is
this last action which gives the owner of the property the right to appeal to
the LBAA. The procedure likewise does not permit the property owner the
remedy of filing a motion for reconsideration before the local assessor. The
pertinent holding of the Court in Callanta is as follows:
x x x [T]he same Code is equally clear that the aggrieved owners should
have brought their appeals before the LBAA. Unfortunately, despite the
advice to this effect contained in their respective notices of assessment,
the owners chose to bring their requests for a review/readjustment before
the city assessor, a remedy not sanctioned by the law. To allow this
procedure would indeed invite corruption in the system of appraisal and
assessment. It conveniently courts a graft-prone situation where values of
real property may be initially set unreasonably high, and then
subsequently reduced upon the request of a property owner. In the latter
instance, allusions of a possible covert, illicit trade-off cannot be avoided,
and in fact can conveniently take place. Such occasion for mischief must
be prevented and excised from our system.[36]
For its part, the appellate court declared in CA-G.R. SP No. 67491:
x x x. The Court announces: Henceforth, whenever the local assessor
sends a notice to the owner or lawful possessor of real property of its
revised assessed value, the former shall no longer have any jurisdiction to
entertain any request for a review or readjustment. The appropriate forum
where the aggrieved party may bring his appeal is the LBAA as provided
by law. It follows ineluctably that the 60-day period for making the appeal
to the LBAA runs without interruption. This is what We held in SP 67490
and reaffirm today in SP 67491.[37]
To reiterate, if the taxpayer fails to appeal in due course, the right of
the local government to collect the taxes due with respect to the taxpayers
property becomes absolute upon the expiration of the period to appeal.
[38]
It also bears stressing that the taxpayers failure to question the
assessment in the LBAA renders the assessment of the local assessor final,
executory and demandable, thus, precluding the taxpayer from
questioning the correctness of the assessment, or from invoking any
defense that would reopen the question of its liability on the merits. [39]
In fine, the LBAA acted correctly when it dismissed the petitioners appeal
for having been filed out of time; the CBAA and the appellate court were
likewise correct in affirming the dismissal. Elementary is the rule that the
perfection of an appeal within the period therefor is both mandatory and
jurisdictional, and failure in this regard renders the decision final and
executory.[40]
In the Comment filed by the Provincial Assessor, it is asserted that the
instant petition is barred by res judicata; that the final and executory
judgment in G.R. No. 165113 (where there was a final determination on the
issue of prescription), effectively precludes the claims herein; and that the
filing of the instant petition after an adverse judgment in G.R. No. 165113
constitutes forum shopping.
FELS maintains that the argument of the Provincial Assessor is completely
misplaced since it was not a party to the erroneous petition which the NPC
filed in G.R. No. 165113. It avers that it did not participate in the aforesaid
proceeding, and the Supreme Court never acquired jurisdiction over it. As
to the issue of forum shopping, petitioner claims that no forum shopping
could have been committed since the elements of litis pendentia or res
judicata are not present.
We do not agree.
Res judicata pervades every organized system of jurisprudence and is
founded upon two grounds embodied in various maxims of common law,
namely: (1) public policy and necessity, which makes it to the interest of
the
State that there should be an end to litigation republicae ut sit litium; and
(2) the hardship on the individual of being vexed twice for the same
cause nemo debet bis vexari et eadem causa. A conflicting doctrine would
subject the public peace and quiet to the will and dereliction of individuals
and prefer the regalement of the litigious disposition on the part of suitors
to the preservation of the public tranquility and happiness. [41] As we ruled
in Heirs of Trinidad De Leon Vda. de Roxas v. Court of Appeals:[42]
x x x An existing final judgment or decree rendered upon the merits,
without fraud or collusion, by a court of competent jurisdiction acting upon
a matter within its authority is conclusive on the rights of the parties and
their privies. This ruling holds in all other actions or suits, in the same or
any other judicial tribunal of concurrent jurisdiction, touching on the points
or matters in issue in the first suit.
xxx
Courts will simply refuse to reopen what has been decided. They will not
allow the same parties or their privies to litigate anew a question once it
has been considered and decided with finality. Litigations must end and
terminate sometime and somewhere. The effective and efficient
administration of justice requires that once a judgment has become final,
the prevailing party should not be deprived of the fruits of the verdict by
subsequent suits on the same issues filed by the same parties.
This is in accordance with the doctrine of res judicata which has the
following elements: (1) the former judgment must be final; (2) the court
which rendered it had jurisdiction over the subject matter and the parties;
(3) the judgment must be on the merits; and (4) there must be between
the first and the second actions, identity of parties, subject matter and
causes of action. The application of the doctrine of res judicata does
not require absolute identity of parties but merely substantial
identity of parties. There is substantial identity of parties when
there is community of interest or privity of interest between a
party in the first and a party in the second case even if the first
case did not implead the latter.[43]
To recall, FELS gave NPC the full power and authority to represent it in any
proceeding regarding real property assessment. Therefore, when petitioner
NPC filed its petition for review docketed as G.R. No. 165113, it did so not
only on its behalf but also on behalf of FELS. Moreover, the assailed
decision in the earlier petition for review filed in this Court was the decision
of the appellate court in CA-G.R. SP No. 67490, in which FELS was the
petitioner. Thus, the decision in G.R. No. 165116 is binding on petitioner
FELS under the principle of privity of interest. In fine, FELS and NPC
are substantially identical parties as to warrant the application of res
judicata. FELSs argument that it is not bound by the erroneous petition
filed by NPC is thus unavailing.
On the issue of forum shopping, we rule for the Provincial Assessor. Forum
shopping exists when, as a result of an adverse judgment in one forum, a
party seeks another and possibly favorable judgment in another forum
other than by appeal or special civil action or certiorari. There is also forum
shopping when a party institutes two or more actions or proceedings
grounded on the same cause, on the gamble that one or the other court
would make a favorable disposition.[44]
Petitioner FELS alleges that there is no forum shopping since the elements
of res judicata are not present in the cases at bar; however, as already
discussed, res judicata may be properly applied herein. Petitioners
engaged in forum shopping when they filed G.R. Nos. 168557 and 170628
after the petition for review in G.R. No. 165116. Indeed, petitioners went
from one court to another trying to get a favorable decision from one of the
tribunals which allowed them to pursue their cases.
It must be stressed that an important factor in determining the existence
of forum shopping is the vexation caused to the courts and the parties-
litigants by the filing of similar cases to claim substantially the same
reliefs.[45] The rationale against forum shopping is that a party should not
be allowed to pursue simultaneous remedies in two different fora. Filing
multiple petitions or complaints constitutes abuse of court processes,
which tends to degrade the administration of justice, wreaks havoc upon
orderly judicial procedure, and adds to the congestion of the heavily
burdened dockets of the courts.[46]
Thus, there is forum shopping when there exist: (a) identity of parties, or at
least such parties as represent the same interests in both actions, (b)
identity of rights asserted and relief prayed for, the relief being founded on
the same facts, and (c) the identity of the two preceding particulars is such
that any judgment rendered in the pending case, regardless of which party
is successful, would amount to res judicata in the other.[47]
Having found that the elements of res judicata and forum shopping are
present in the consolidated cases, a discussion of the other issues is no
longer necessary. Nevertheless, for the peace and contentment of
petitioners, we shall shed light on the merits of the case.
As found by the appellate court, the CBAA and LBAA power barges are real
property and are thus subject to real property tax. This is also the
inevitable conclusion, considering that G.R. No. 165113 was dismissed for
failure to sufficiently show any reversible error. Tax assessments by tax
examiners are presumed correct and made in good faith, with the taxpayer
having the burden of proving otherwise.[48]Besides, factual findings of
administrative bodies, which have acquired expertise in their field, are
generally binding and conclusive upon the Court; we will not assume to
interfere with the sensible exercise of the judgment of men especially
trained in appraising property. Where the judicial mind is left in doubt, it is
a sound policy to leave the assessment undisturbed. [49] We find no reason
to depart from this rule in this case.
In Consolidated Edison Company of New York, Inc., et al. v. The City of New
York, et al.,[50] a power company brought an action to review property tax
assessment. On the citys motion to dismiss, the Supreme Court of New
York held that the barges on which were mounted gas turbine power plants
designated to generate electrical power, the fuel oil barges which supplied
fuel oil to the power plant barges, and the accessory equipment mounted
on the barges were subject to real property taxation.
Moreover, Article 415 (9) of the New Civil Code provides that [d]ocks and
structures which, though floating, are intended by their nature and object
to remain at a fixed place on a river, lake, or coast are considered
immovable property. Thus, power barges are categorized as immovable
property by destination, being in the nature of machinery and other
implements intended by the owner for an industry or work which may be
carried on in a building or on a piece of land and which tend directly to
meet the needs of said industry or work.[51]
Petitioners maintain nevertheless that the power barges are exempt from
real estate tax under Section 234 (c) of R.A. No. 7160 because they are
actually, directly and exclusively used by petitioner NPC, a government-
owned and controlled corporation engaged in the supply, generation, and
transmission of electric power.
We affirm the findings of the LBAA and CBAA that the owner of the taxable
properties is petitioner FELS, which in fine, is the entity being taxed by the
local government. As stipulated under Section 2.11, Article 2 of the
Agreement:
OWNERSHIP OF POWER BARGES. POLAR shall own the Power Barges
and all the fixtures, fittings, machinery and equipment on the Site used in
connection with the Power Barges which have been supplied by it at its
own cost. POLAR shall operate, manage and maintain the Power Barges for
the purpose of converting Fuel of NAPOCOR into electricity. [52]
It follows then that FELS cannot escape liability from the payment of realty
taxes by invoking its exemption in Section 234 (c) of R.A. No. 7160, which
reads:
SECTION 234. Exemptions from Real Property Tax. The following are
exempted from payment of the real property tax:
xxx
(c) All machineries and equipment that are actually, directly and
exclusively used by local water districts and government-owned or
controlled corporations engaged in the supply and distribution of water
and/or generation and transmission of electric power; x x x
Indeed, the law states that the machinery must be actually, directly and
exclusively used by the government owned or controlled corporation;
nevertheless, petitioner FELS still cannot find solace in this provision
because Section 5.5, Article 5 of the Agreement provides:
OPERATION. POLAR undertakes that until the end of the Lease Period,
subject to the supply of the necessary Fuel pursuant to Article 6 and to the
other provisions hereof, it will operate the Power Barges to convert
such Fuel into electricity in accordance with Part A of Article 7. [53]
It is a basic rule that obligations arising from a contract have the force of
law between the parties. Not being contrary to law, morals, good customs,
public order or public policy, the parties to the contract are bound by its
terms and conditions.[54]
 VILLARAMA, JR., JJ.
Time and again, the Supreme Court has stated that taxation is the rule and Promulgated:
exemption is the exception. [55] The law does not look with favor on tax
exemptions and the entity that would seek to be thus privileged must RAMON C. JAVELLANA, January 25, 2012
justify it by words too plain to be mistaken and too categorical to be ET AL.,
misinterpreted.[56] Thus, applying the rule of strict construction of laws Respondents.
granting tax exemptions, and the rule that doubts should be resolved in
x-----------------------------------------------------------------------------------------x
favor of provincial corporations, we hold that FELS is considered a taxable
entity.
DECISION
The mere undertaking of petitioner NPC under Section 10.1 of the
BERSAMIN, J.:
Agreement, that it shall be responsible for the payment of all real estate
taxes and assessments, does not justify the exemption. The privilege
granted to petitioner NPC cannot be extended to FELS. The covenant is
The denial of a motion for reconsideration of an order granting the
between FELS and NPC and does not bind a third person not privy thereto,
defending partys motion to dismiss is not an interlocutory but a final order
in this case, the Province of Batangas.
because it puts an end to the particular matter involved, or settles
definitely the matter therein disposed of, as to leave nothing for the trial
It must be pointed out that the protracted and circuitous litigation has
court to do other than to execute the order. [1] Accordingly, the claiming
seriously resulted in the local governments deprivation of revenues. The
party has a fresh period of 15 days from notice of the denial within which
power to tax is an incident of sovereignty and is unlimited in its magnitude,
to appeal the denial.[2]
acknowledging in its very nature no perimeter so that security against its
abuse is to be found only in the responsibility of the legislature which
Antecedents
imposes the tax on the constituency who are to pay for it. [57] The right of
local government units to collect taxes due must always be upheld to avoid
On September 8, 1979, Margarita Marquez Alma Jose (Margarita) sold for
severe tax erosion. This consideration is consistent with the State policy to
consideration of P160,000.00 to respondent Ramon Javellana by deed of
guarantee the autonomy of local governments [58] and the objective of the
conditional sale two parcels of land with areas of 3,675 and 20,936 square
Local Government Code that they enjoy genuine and meaningful local
meters located in Barangay Mallis, Guiguinto, Bulacan. They agreed that
autonomy to empower them to achieve their fullest development as self-
Javellana would pay P80,000.00 upon the execution of the deed and the
reliant communities and make them effective partners in the attainment of
balance of P80,000.00 upon the registration of the parcels of land under
national goals.[59]
the Torrens System (the registration being undertaken by Margarita within
a reasonable period of time); and that should Margarita become
In conclusion, we reiterate that the power to tax is the most potent
incapacitated, her son and attorney-in-fact, Juvenal M. Alma Jose (Juvenal),
instrument to raise the needed revenues to finance and support myriad
and her daughter, petitioner Priscilla M. Alma Jose, would receive the
activities of the local government units for the delivery of basic services
payment of the balance and proceed with the application for registration. [3]
essential to the promotion of the general welfare and the enhancement of
peace, progress, and prosperity of the people.[60]
After Margarita died and with Juvenal having predeceased Margarita
without issue, the vendors undertaking fell on the shoulders of Priscilla,
WHEREFORE, the Petitions are DENIED and the assailed Decisions and
being Margaritas sole surviving heir. However, Priscilla did not comply with
Resolutions AFFIRMED.
the undertaking to cause the registration of the properties under the
Torrens System, and, instead, began to improve the properties by dumping
SO ORDERED.
filling materials therein with the intention of converting the parcels of land
into a residential or industrial subdivision. [4] Faced with Priscillas refusal to
PRISCILLA ALMA JOSE, G.R. No. 158239 comply, Javellana commenced on February 10, 1997 an action for specific
Petitioner, performance, injunction, and damages against her in the Regional Trial
Present: Court in Malolos, Bulacan (RTC), docketed as Civil Case No. 79-M-97
entitled Ramon C. Javellana, represented by Atty. Guillermo G. Blanco v.
CORONA, C.J., Chairperson, Priscilla Alma Jose.
LEONARDO-DE CASTRO,
- versus - BERSAMIN, In Civil Case No. 79-M-97, Javellana averred that upon the execution of the
*
ABAD, and deed of conditional sale, he had paid the initial amount of P80,000.00 and
had taken possession of the parcels of land; that he had paid the balance
of the purchase price to Juvenal on different dates upon Juvenals
representation that Margarita had needed funds for the expenses of
registration and payment of real estate tax; and that in 1996, Priscilla had
called to inquire about the mortgage constituted on the parcels of land;
and that he had told her then that the parcels of land had not been
mortgaged but had been sold to him.[5]
Javellana prayed for the issuance of a temporary restraining order or writ
of preliminary injunction to restrain Priscilla from dumping filling materials
in the parcels of land; and that Priscilla be ordered to institute registration
proceedings and then to execute a final deed of sale in his favor. [6]
Priscilla filed a motion to dismiss, stating that the complaint was already
barred by prescription; and that the complaint did not state a cause of
action.[7]
The RTC initially denied Priscillas motion to dismiss on February 4, 1998.
[8]
However, upon her motion for reconsideration, the RTC reversed itself on
June 24, 1999 and granted the motion to dismiss, opining that Javellana
had no cause of action against her due to her not being bound to comply
with the terms of the deed of conditional sale for not being a party thereto;
that there was no evidence showing the payment of the balance; that he
had never demanded the registration of the land from Margarita or Juvenal,
or brought a suit for specific performance against Margarita or Juvenal; and
that his claim of paying the balance was not credible. [9]
Javellana moved for reconsideration, contending that the presentation of
evidence of full payment was not necessary at that stage of the
proceedings; and that in resolving a motion to dismiss on the ground of
failure to state a cause of action, the facts alleged in the complaint were
hypothetically admitted and only the allegations in the complaint should be
considered in resolving the motion.[10]Nonetheless, he attached to the
motion for reconsideration the receipts showing the payments made to
Juvenal.[11] Moreover, he maintained that Priscilla could no longer succeed
to any rights respecting the parcels of land because he had meanwhile
acquired absolute ownership of them; and that the only thing that she, as
sole heir, had inherited from Margarita was the obligation to register them
under the Torrens System.[12]
On June 21, 2000, the RTC denied the motion for reconsideration for lack of
any reason to disturb the order of June 24, 1999.[13]
Accordingly, Javellana filed a notice of appeal from the June 21, 2000 order,
[14]
which the RTC gave due course to, and the records were elevated to the
Court of Appeals (CA).
In his appeal (C.A.-G.R. CV No. 68259), Javellana submitted the following as
errors of the RTC,[15] to wit:
I
THE TRIAL COURT GRIEVOUSLY ERRED IN NOT CONSIDERING THE FACT
THAT PLAINTIFF-APELLANT HAD LONG COMPLIED WITH THE FULL PAYMENT
OF THE CONSIDERATION OF THE SALE OF THE SUBJECT PROPERTY AND
HAD IMMEDIATELY TAKEN ACTUAL AND PHYSICAL POSSESSION OF SAID
PROPERTY UPON THE SIGNING OF THE CONDITIONAL DEED OF SALE;
II
THE TRIAL COURT OBVIOUSLY ERRED IN MAKING TWO CONFLICTING
INTERPRETATIONS OF THE PROVISION OF THE CIVIL [CODE], PARTICULARLY
ARTICLE 1911, IN THE LIGHT OF THE TERMS OF THE CONDITIONAL DEED
OF SALE;
III
THE TRIAL COURT ERRED IN HOLDING THAT DEFENDANT-APPELLEE BEING
NOT A PARTY TO THE CONDITIONAL DEED OF SALE EXECUTED BY HER
MOTHER IN FAVOR OF PLAINTFF-
APPELLANT IS NOT BOUND THEREBY AND CAN NOT BE COMPELLED TO DO
THE ACT REQUIRED IN THE SAID DEED OF CONDITIONAL SALE;
IV
THE TRIAL COURT ERRED IN DISMISSING THE AMENDED COMPLAINT
WITHOUT HEARING THE CASE ON THE MERITS.
Priscilla countered that the June 21, 2000 order was not appealable; that
the appeal was not perfected on time; and that Javellana was guilty of
forum shopping.[16]
It appears that pending the appeal, Javellana also filed a petition
for certiorari in the CA to assail the June 24, 1999 and June 21, 2000 orders
dismissing his complaint (C.A.-G.R. SP No. 60455). On August 6, 2001,
however, the CA dismissed the petition for certiorari,[17] finding that the
RTC did not commit grave abuse of discretion in issuing the orders, and
holding that it only committed, at most, an error of judgment correctible by
appeal in issuing the challenged orders.
On November 20, 2002, the CA promulgated its decision in C.A.-G.R. CV
No. 68259,[18] reversing and setting aside the dismissal of Civil Case No. 79-
M-97, and remanding the records to the RTC for further proceedings in
accordance with law.[19] The CA explained that the complaint sufficiently
stated a cause of action; that Priscilla, as sole heir, succeeded to the rights
and obligations of Margarita with respect to the parcels of land; that
Margaritas undertaking under the contract was not a purely personal
obligation but was transmissible to Priscilla, who was consequently bound
to comply with the obligation;that the action had not yet prescribed due to
its being actually one for quieting of title that was imprescriptible brought
by Javellana who had actual possession of the properties; and that based
on the
complaint, Javellana had been in actual possession since 1979, and the
cloud on his title had come about only when Priscilla had started dumping
filling materials on the premises.[20]
On May 9, 2003, the CA denied the motion for reconsideration, [21] stating
that it decided to give due course to the appeal even if filed out of time
because Javellana had no intention to delay the proceedings, as in fact he
did not even seek an extension of time to file his appellants brief; that
current jurisprudence afforded litigants the amplest opportunity to present
their cases free from the constraints of technicalities, such that even if an
appeal was filed out of time, the appellate court was given the discretion to
nonetheless allow the appeal for justifiable reasons.
Issues
Priscilla then brought this appeal, averring that the CA thereby erred in not
outrightly dismissing Javellanas appeal because: (a) the June 21, 2000 RTC
order was not appealable; (b) the notice of appeal had been filed belatedly
by three days; and (c) Javellana was guilty of forum shopping for filing in
the CA a petition for certiorari to assail the orders of the RTC that were the
subject matter of his appeal pending in the CA. She posited that, even if
the CAs decision to entertain the appeal was affirmed, the RTCs dismissal
of the complaint should nonetheless be upheld because the complaint
stated no cause of action, and the action had already prescribed.
On his part, Javellana countered that the errors being assigned by Priscilla
involved questions of fact not proper for the Court to review through
petition for review on certiorari; that the June 21, 2000 RTC order, being a
final order, was appealable; that his appeal was perfected on time; and
that he was not guilty of forum shopping because at the time he filed the
petition for certiorari the CA had not yet rendered a decision in C.A.-G.R.
CV No. 68259, and because the issue of ownership raised in C.A.-G.R. CV
No. 68259 was different from the issue of grave abuse of discretion raised
in C.A.-G.R. SP No. 60455.
Ruling
The petition for review has no merit.
I order being included in the appeal of the judgment itself.
Denial of the motion for reconsideration of the
order of dismissal was a final order and appealable
Priscilla submits that the order of June 21, 2000 was not the proper subject
of an appeal considering that Section 1 of Rule 41 of the Rules of
Court provides that no appeal may be taken from an order denying a
motion for reconsideration.
Priscillas submission is erroneous and cannot be sustained.
First of all, the denial of Javellanas motion for reconsideration left nothing
more to be done by the RTC because it confirmed the dismissal of Civil
Case No. 79-M-97. It was clearly a final order, not an interlocutory one. The
Court has distinguished between final and interlocutory orders in Pahila-
Garrido v. Tortogo,[22] thuswise:
The distinction between a final order and an interlocutory order is well
known. The first disposes of the subject matter in its entirety or terminates
a particular proceeding or action, leaving nothing more to be done except
to enforce by execution what the court has determined, but the latter does
not completely dispose of the case but leaves something else to be
decided upon. An interlocutory order deals with preliminary matters and
the trial on the merits is yet to be held and the judgment
rendered. The test to ascertain whether or not an order or a judgment is
interlocutory or final is: does the order or judgment leave something to be
done in the trial court with respect to the merits of the case? If it does, the
order or judgment is interlocutory; otherwise, it is final.
And, secondly, whether an order is final or interlocutory determines
whether appeal is the correct remedy or not. A final order is appealable, to
accord with the final judgment rule enunciated in Section 1, Rule 41 of
the Rules of Court to the effect that appeal may be taken from a judgment
or final order that completely disposes of the case, or of a particular matter
therein when declared by these Rules to be appealable; [23] but the remedy
from an interlocutory one is not an appeal but a special civil action
for certiorari. The explanation for the differentiation of remedies given
in Pahila-Garrido v. Tortogo is apt:
xxx The reason for disallowing an appeal from an interlocutory order is to
avoid multiplicity of appeals in a single action, which necessarily suspends
the hearing and decision on the merits of the action during the pendency
of the appeals. Permitting multiple appeals will necessarily delay the trial
on the merits of the case for a considerable length of time, and will compel
the adverse party to incur unnecessary expenses, for one of the parties
mayinterpose as many appeals as there are incidental questions raised by
him and as there are interlocutory orders rendered or issued by the lower
court. An interlocutory order may be the subject of an appeal, but only
after a judgment has been rendered, with the ground for appealing the
The remedy against an interlocutory order not subject of an appeal is an
appropriate special civil action under Rule 65, provided that the
interlocutory order is rendered without or in excess of jurisdiction or with
grave abuse of discretion. Then is certiorari under Rule 65 allowed to be
resorted to.
Indeed, the Court has held that an appeal from an order denying a motion
for reconsideration of a final order or judgment is effectively an appeal
from the final order or judgment itself; and has expressly clarified
that the prohibition against appealing an order denying a motion for
reconsideration referred only to a denial of a motion for reconsideration of
an interlocutory order.[24]

II
Appeal was made on time pursuant to Neypes v. CA
Priscilla insists that Javellana filed his notice of appeal out of time. She
points out that he received a copy of the June 24, 1999 order on July 9,
1999, and filed his motion for reconsideration on July 21, 1999 (or after the
lapse of 12 days); that the RTC denied his motion for reconsideration
through the order of June 21, 2000, a copy of which he received on July 13,
2000; that he had only three days from July 13, 2000, or until July 16, 2000,
within which to perfect an appeal; and that having filed his notice of appeal
on July 19, 2000, his appeal should have been dismissed for being tardy by
three days beyond the expiration of the reglementary period.
Section 3 of Rule 41 of the Rules of Court provides:
Section 3. Period of ordinary appeal. The appeal shall be taken within
fifteen (15) days from notice of the judgment or final order appealed from.
Where a record on appeal is required, the appellant shall file a notice of
appeal and a record on appeal within thirty (30) days from notice of the
judgment or final order.
The period of appeal shall be interrupted by a timely motion for
new trial or reconsideration. No motion for extension of time to
file a motion for new trial or reconsideration shall be allowed. (n)
Under the rule, Javellana had only the balance of three days from July 13,
2000, or until July 16, 2000, within which to perfect an appeal due to the
timely filing of his motion for reconsideration interrupting the running of
the period of appeal. As such, his filing of the notice of appeal only on July
19, 2000 did not perfect his appeal on time, as Priscilla insists.
The seemingly correct insistence of Priscilla cannot be upheld, however,
considering that the Court meanwhile adopted the fresh period
rule in Neypes v. Court of Appeals, [25] by which an aggrieved party desirous
of appealing an adverse judgment or final order is allowed a fresh period of
15 days within which to file the notice of appeal in the RTC reckoned from
receipt of the order denying a motion for a new trial or motion for
reconsideration, to wit:
The Supreme Court may promulgate procedural rules in all courts. It has
the sole prerogative to amend, repeal or even establish new rules for a
more simplified and inexpensive process, and the speedy disposition of
cases. In the rules governing appeals to it and to the Court of Appeals,
particularly Rules 42, 43 and 45, the Court allows extensions of time, based
on justifiable and compelling reasons, for parties to file their appeals.
These extensions may consist of 15 days or more.
To standardize the appeal periods provided in the Rules and to afford
litigants fair opportunity to appeal their cases, the Court deems it practical
to allow a fresh period of 15 days within which to file the notice of appeal
in the Regional Trial Court, counted from receipt of the order dismissing a
motion for a new trial or motion for reconsideration.
Henceforth, this fresh period rule shall also apply to Rule 40 governing
appeals from the Municipal Trial Courts to the Regional Trial Courts; Rule 42
on petitions for review from the Regional Trial Courts to the Court of
Appeals; Rule 43 on appeals from quasi-judicial agencies to the Court of
Appeals and Rule 45 governing appeals by certiorari to the Supreme Court.
The new rule aims to regiment or make the appeal period uniform, to be
counted from receipt of the order denying the motion for new trial, motion
for reconsideration (whether full or partial) or any final order or resolution.
[26]
The fresh period rule may be applied to this case, for the Court has already
retroactively extended the fresh period rule to actions pending and
undetermined at the time of their passage and this will not violate any
right of a person who may feel that he is adversely affected, inasmuch as
there are no vested rights in rules of procedure. [27] According to De los
Santos v. Vda. de Mangubat:[28]
Procedural law refers to the adjective law which prescribes rules and forms
of procedure in order that courts may be able to administer justice.
Procedural laws do not come within the legal conception of a retroactive
law, or the general rule against the retroactive operation of statues they
may be given retroactive effect on actions pending and undetermined at
the time of their passage and this will not violate any right of a person who
may feel that he is adversely affected, insomuch as there are no vested
rights in rules of procedure.
The fresh period rule is a procedural law as it prescribes a fresh period of
15 days within which an appeal may be made in the event that the motion
for reconsideration is denied by the lower court. Following the rule on
retroactivity of procedural laws, the "fresh period rule" should be applied to
pending actions, such as the present case.
Also, to deny herein petitioners the benefit of the fresh period rule will
amount to injustice, if not absurdity, since the subject notice of judgment
and final order were issued two years later or in the year 2000, as
compared to the notice of judgment and final order in Neypes which were
issued in 1998. It will be incongruous and illogical that parties receiving
notices of judgment and final orders issued in the year 1998 will enjoy the
benefit of the fresh period rule while those later rulings of the lower courts
such as in the instant case, will not.[29]
Consequently, we rule that Javellanas notice of appeal was timely filed
pursuant to the fresh period rule.
III
No forum shopping was committed

Priscilla claims that Javellana engaged in forum shopping by filing a notice
of appeal and a petition for certiorari against the same orders. As earlier
noted, he denies that his doing so violated the policy against forum
shopping.
The Court expounded on the nature and purpose of forum shopping in In
Re: Reconstitution of Transfer Certificates of Title Nos. 303168 and 303169
and Issuance of Owners Duplicate Certificates of Title In Lieu of Those Lost,
Rolando Edward G. Lim, Petitioner:[30]
Forum shopping is the act of a party litigant against whom an adverse
judgment has been rendered in one forum seeking and possibly getting a
favorable opinion in another forum, other than by appeal or the special
civil action of certiorari, or the institution of two or more actions or
proceedings grounded on the same cause or supposition that one or the
other court would make a favorable disposition. Forum shopping happens
when, in the two or more pending cases, there is identity of parties,
identity of rights or causes of action, and identity of reliefs sought. Where
the elements of litis pendentia are present, and where a final judgment in
one case will amount to res judicata in the other, there is forum shopping.
For litis pendentia to be a ground for the dismissal of an action, there must
be: (a) identity of the parties or at least such as to represent the same
interest in both actions; (b) identity of rights asserted and relief prayed for,
the relief being founded on the same acts; and (c) the identity in the two
cases should be such that the judgment which may be rendered in one
would, regardless of which party is successful, amount to res judicata in
the other.
For forum shopping to exist, both actions must involve the same
transaction, same essential facts and circumstances and must raise
identical causes of action, subject matter and issues. Clearly, it does not
exist where different orders were questioned, two distinct causes of action
and issues were raised, and two objectives were sought.
Should Javellanas present appeal now be held barred by his filing of the
petition for certiorari in the CA when his appeal in that court was yet
pending?
We are aware that in Young v. Sy,[31] in which the petitioner filed a notice of
appeal to elevate the orders concerning the dismissal of her case due to
non-suit to the CA and a petition for certiorari in the CA assailing the same
orders four months later, the Court ruled that the successive filings of the
notice of appeal and the petition for certiorari to attain the same objective
of nullifying the trial courts dismissal orders constituted forum shopping
that warranted the dismissal of both cases. The Court said:
Ineluctably, the petitioner, by filing an ordinary appeal and a petition
for certiorari with the CA, engaged in forum shopping. When the petitioner
commenced the appeal, only four months had elapsed prior to her filing
with the CA the Petition for Certiorari under Rule 65 and which eventually
came up to this Court by way of the instant Petition (re: Non-Suit). The
elements of litis pendentia are present between the two suits. As the CA,
through its Thirteenth Division, correctly noted, both suits are founded on
exactly the same facts and refer to the same subject
matterthe RTC Orders which dismissed Civil Case No. SP-5703 (2000) for
failure to prosecute. In both cases, the petitioner is seeking the reversal of
the RTC orders. The parties, the rights asserted, the issues professed, and
the reliefs prayed for, are all the same. It is evident that the judgment of
one forum may amount to res judicata in the other.
xxxx
The remedies of appeal and certiorari under Rule 65 are mutually exclusive
and not alternative or cumulative. This is a firm judicial policy. The
petitioner cannot hedge her case by wagering two or more appeals, and, in
the event that the ordinary appeal lags significantly behind the others, she
cannot post facto validate this circumstance as a demonstration that the
ordinary appeal had not been speedy or adequate enough, in order to
justify the recourse to Rule 65. This practice, if adopted, would sanction the
filing of multiple suits in multiple fora, where each one, as the petitioner
couches it, becomes a precautionary measure for the rest, thereby
increasing the chances of a favorable decision. This is the very evil that the
proscription on forum shopping seeks to put right. In Guaranteed Hotels,
Inc. v. Baltao, the Court stated that the grave evil sought to be avoided by
the rule against forum shopping is the rendition by two competent
tribunals of two separate and contradictory decisions. Unscrupulous party
litigants, taking advantage of a variety of competent tribunals, may
repeatedly try their luck in several different fora until a favorable result is
reached. To avoid the resultant confusion, the Court adheres strictly to the
rules against forum shopping, and any violation of these rules results in the
dismissal of the case.[32]
The same result was reached in Zosa v. Estrella,[33] which likewise involved
the successive filing of a notice of appeal and a petition for certiorari to
challenge the same orders, with the Court upholding the CAs dismissals of
the appeal and the petition for certiorari through separate decisions.
Yet, the outcome in Young v. Sy and Zosa v. Estrella is unjust here even if
the orders of the RTC being challenged through appeal and the petition
for certiorari were the same. The unjustness exists because the appeal and
the petition for certiorari actually sought different objectives. In his appeal
in C.A.-G.R. CV No. 68259, Javellana aimed to undo the RTCs erroneous
dismissal of Civil Case No. 79-M-97 to clear the way for his judicial demand
for specific performance to be tried and determined in due course by the
RTC; but his petition for certiorari had the ostensible objective to prevent
(Priscilla) from developing the subject property and from proceeding with
the ejectment case until his appeal is finally resolved, as the CA explicitly
determined in its decision in C.A.-G.R. SP No. 60455. [34]
Nor were the dangers that the adoption of the judicial policy against forum
shopping designed to prevent or to eliminate attendant. The first
danger, i.e., the multiplicity of suits upon one and the same cause of
action, would not materialize considering that the appeal was a continuity
of Civil Case No. 79-M-97, whereas C.A.-G.R. SP No. 60455 dealt with an
independent ground of alleged grave abuse of discretion amounting to lack
or excess of jurisdiction on the part of the RTC. The second danger, i.e., the
unethical malpractice of shopping for a friendly court or judge to ensure a
favorable ruling or judgment after not getting it in the appeal, would not
arise because the CA had not yet decided C.A.-G.R. CV No. 68259 as of the
filing of the petition for certiorari.
Instead, we see the situation of resorting to two inconsistent remedial
approaches to be the result of the tactical misjudgment by Javellanas
counsel on the efficacy of the appeal to stave off his caretakers eviction
from the parcels of land and to prevent the development of them into a
residential or commercial subdivision pending the appeal. In the petition
for certiorari, Javellana explicitly averred that his appeal was inadequate
and not speedy to prevent private respondent Alma Jose and her
transferee/assignee xxx from developing and disposing of the subject
property to other parties to the total deprivation of petitioners rights of
possession and ownership over the subject property, and that the dismissal
by the RTC had emboldened private respondents to fully develop the
property and for respondent Alma Jose to file an ejectment case against
petitioners overseer xxx.[35] Thereby, it became far-fetched that Javellana
brought the petition for certiorari in violation of the policy against forum
shopping.
WHEREFORE, the Court DENIES the petition for review
on certiorari; AFFIRMS the decision promulgated on November 20, 2002;
and ORDERS the petitioner to pay the costs of suit.
SO ORDERED.
G.R. No. L-63397 April 9, 1985
ALEX LINA, petitioner,
vs.
THE HONORABLE COURT OF APPEALS; HONORABLE GREGORIO
PINEDA, as Presiding Judge of the Court of First Instance of Rizal,
Branch XXI at Pasig; and NORTHERN MOTORS, INC., respondents.
Olalia, Cabrera, Aguila & Bautista Law Office for private respondent.
RELOVA, J.:
Appeal by certiorari from the decision of the then Court of Appeals in CA-
G.R. No. 14943-SP, dated November 29, 1982, affirming (a) the order of
default issued by respondent judge in a collection suit instituted by private
respondent Northern Motors, Inc. against petitioner; and, (b) the judgment
of default in the same case.
On March 31, 1982, private respondent Northern Motors, Inc. filed with the
then Court of First Instance of Rizal (Pasig) a case for sum of money with
damages; docketed as Civil Case No. 4520.
On April 22, 1982, petitioner Alex Lina was served with summons together
with a copy of the complaint.
On May 8, 1982, when no answer or motion to dismiss was filed by
petitioner, private respondent Northern Motors, Inc. filed a motion to
declare him in default. The motion was set for hearing on May 21, 1982.
On May 19, 1982, petitioner filed his opposition to the aforesaid motion
inviting attention to the fact that he had filed a motion for extension of
time to file responsive pleading within the reglementary period. On May
26, 1982, respondent judge issued an order declaring defendant (herein
petitioner) in default and allowing plaintiff (herein private respondent) to
adduce its evidence ex parte.
On May 27, 1982, defendant (petitioner) filed his answer to the complaint.
On July 28, 1982, respondent court rendered its decision in favor of plaintiff
(herein private respondent).
On August 11, 1982, petitioner filed a motion to set aside decision dated
July 28, 1982.
On August 25, 1982, respondent judge issued an order denying petitioner's
motion to set aside decision.
On October 6, 1982, petitioner filed with the then Court of Appeals a
petition for certiorari/prohibition, which was denied in its decision dated
November 29, 1982 on the ground that
... when the private respondent filed on May 8, 1982, its motion to declare
defendant in default because the last day for him to file an answer under
the summons was May 7, 1982, the petitioner has not filed an answer. So,
there was actually a valid ground for the motion, and the respondent court
could have validly declared the defendant in default, especially because, at
that time it was still unaware of the fact that on May 5, 1982, the herein
petitioner had sent to it, by registered mail, a motion for extension of
twenty days from May 7, 1982, within which to file an answer, and which
motion was received by the respondent court only on May 19, 1982.
But, then the respondent court did not immediately act on the motion to
declare defendant in default, so that by May 19, 1982, the herein petitioner
was still able to file an opposition to the motion asking him to be declared
in default. The principal ground of the opposition of the petitioner was the
fact that he had sent, by registered mail, a motion for extension of time to
file responsive pleading, and he even attached to his opposition a copy of
the motion for extension.
On May 26, 1982, the respondent court resolved the motion to declare
defendant in default by granting the motion. Now since on May 26, 1982,
the motion for extension of time to file responsive pleading was already
before the court, as it received the same on May 19, 1982, and aside from
this, a copy thereof was attached to the petitioner's opposition to the
private respondent's motion to declare defendant in default, it is
conclusively assumed that the respondent court, in resolving the motion to
declare defendant in default, had taken into consideration the motion for
extension, especially because the ground of petitioner's opposition to the
motion to declare defendant in default is the fact that he had asked for
extension of time to file responsive pleading. Now, then, when the
respondent court declared the defendant in default, it is a clear and
inevitable implication, without the need of an express statement to that
effect, although it would have been more desirable, that the motion for
extension of nine to file responsive pleading was denied. In other words,
the Order of May 26, 1982 had the necessary and logical implication that
the petitioner's opposition to the motion to declare defendant in default,
based upon the ground that he had asked for extension of time to file
responsive pleading, was disapproved or denied by the court.(pp. 22-23,
Rollo)
Coming to this Court on a petition for certiorari/prohibition, petitioner
raised the following issues, to wit:
1. Whether or not the order of default was issued in grave abuse of
discretion amounting to lack of jurisdiction.
2. Whether or not certiorari is proper in a case where judgment by default
was rendered without an order of default being furnished petitioner and
where meritorious defenses exist, which are for the trial court to evaluate
and which evaluation was not done in this case.
We are in agreement with respondent appellate court's affirmance of the
questioned order of the trial court. The granting of additional time within
which to file an answer to a complaint is a matter largely addressed to the
sound discretion of the trial court. "While trial courts are persuaded, as a
matter of policy, to adopt a basically flexible attitude in favor of the
defendant in this area of our adjective law, the defense should never be
lulled into the belief that whenever trial courts refuse a second request for
extension to file an answer, the appellate courts will grant relief (Naga
Development Corporation vs. Court of Appeals, 41 SCRA 105)."
In the case at bar, it was on May 5, 1982 or two (2) days before the
expiration of the fifteen-day reglementary period given to defendant to file
his responsive pleading when petitioner moved for an extension of twenty
(20) days from May 7 within which to file his answer. Upon motion of
private respondent and over the objection of petitioner, respondent judge
issued an order declaring petitioner in default.
Under the Rules of Court, the remedies available to a defendant in the
Court of First Instance (now Regional Trial Court) are:
a) The defendant in default may, at any time after discovery thereof and
before judgment, file a motion, under oath, to set aside the order of default
on the ground that his failure to answer was due to fraud, accident,
mistake or excusable neglect, and that he has a meritorious defense; (Sec.
3, Rule 18)
b) If the judgment has already been rendered when the defendant
discovered the default, but before the same has become final and
executory, he may file a motion for new trial under Section 1 (a) of Rule 37;
c) If the defendant discovered the default after the judgment has become
final and executory, he may file a petition for relief under Section 2 of Rule
38; and
d) He may also appeal from the judgment rendered against him as
contrary to the evidence or to the law, even if no petition to set aside the
order of default has been presented by him. (Sec. 2, Rule 41)
Petitioner in this case did not avail himself of any of the above remedies.
Instead, he went to the appellate court on certiorari/prohibition. On this
point, respondent appellate court aptly said:
Before us is the petition for certiorari[1] filed by the Republic of the
Philippines (petitioner) to set aside the February 7, 2002 resolution (2002
... where the judgment rendered by the respondent court is the one sought resolution)[2] of the Sandiganbayan[3] denying thepetitioners Motion to
to be annulled, a petition for relief, under Rule 38 of the Revised Rules of Admit Supplemental Offer of Evidence (Re: Deposition of Maurice V.
Court, which is a remedy in the ordinary course of law, could have been Bane) (3rd motion).
just as plain, adequate and speedy as certiorari. Such a remedy could have THE ANTECEDENTS
been granted by the respondent court. And if the respondent court still
On July 22, 1987, the petitioner Republic of the Philippines, through the
denies the petition, then petitioner can take an appeal on the order
Presidential Commission on Good Government (PCGG), filed a complaint
denying the petition, and in the course of such appeal petitioner can also (docketed as Civil Case No. 0009) against Jose L. Africa, Manuel H.
assail the judgment an the merits upon the ground that it is supported by Nieto, Jr., Ferdinand E. Marcos, Imelda R. Marcos, Ferdinand R. Marcos, Jr.,
the evidence, or it is contrary to law. (p. 25, Rollo) Juan Ponce Enrile, and Potenciano Ilusorio (collectively, the respondents)
for reconveyance, reversion, accounting, restitution,
and damages before the Sandiganbayan. The petitioner alleged, inter alia,
ACCORDINGLY, the petition is DISMISSED. Without costs.
that the respondents illegally manipulated the purchase of the major
shareholdings of Cable and Wireless Limited in Eastern
REPUBLIC OF THE PHILIPPINES, G.R. No. 152375 Telecommunications Philippines, Inc. (ETPI), which shareholdings
Petitioner, respondents Jose Africa and Manuel Nieto, Jr. held for themselves and,
Present: through their holdings and the corporations they organized, beneficially for
respondents Ferdinand E. Marcos and Imelda R. Marcos. [4]
CORONA, C.J.,
CARPIO, Civil Case No. 0009 is the main case subject of the present petition. Victor
- versus - VELASCO, JR., Africa (Africa), son of the late Jose L. Africa, was not impleaded in
LEONARDO-DE CASTRO, and so is plainly not a party to Civil Case No. 0009.[5]
BRION,
PERALTA, Civil Case No. 0009 spawned numerous incidental cases, [6] among them,
SANDIGANBAYAN (FOURTH DIVISION), JOSE BERSAMIN, Civil Case No. 0130.[7] The present respondents were not made
L. AFRICA (substituted by his heirs), DEL CASTILLO, parties either in Civil Case No. 0130.
MANUEL H. NIETO, JR., FERDINAND E. ABAD,
MARCOS (substituted by his heirs), IMELDA VILLARAMA, JR., I. Civil Case No. 0130
R. MARCOS, FERDINAND R. MARCOS, JR., PEREZ,
JUAN PONCE ENRILE, and POTENCIANO MENDOZA,
ILUSORIO (substituted by his heirs), SERENO, In the August 7, 1991 PCGG-conducted ETPI stockholders meeting, a PCGG-
Respondents. REYES, and controlled board of directors was elected. Later, the registered ETPI
PERLAS-BERNABE, JJ. stockholders convened a special stockholders meeting wherein another set
of board of directors was elected. As a result, two sets of ETPI board and
Promulgated: officers were elected.[8]

December 16, 2011 Thereafter, Africa, as an ETPI stockholder, filed a petition for certiorari, with
prayer for a temporary restraining order/preliminary injunction with the
x----------------------------------------------------------------------------------------- Sandiganbayan (docketed as Civil Case No. 0130), seeking to nullify
x the August 5, 1991 and August 9, 1991 Orders of the PCGG. These Orders
directed Africa:

DECISION [T]o account for his sequestered shares in ETPI and to cease and desist
from exercising voting rights on the sequestered shares in the special
stockholders meeting to be held on August 12, 1991, from representing
BRION, J.:
himself as a director, officer, employee or agent of ETPI, and from
participating, directly or indirectly[,] in the management of ETPI. [9]
During the pendency of Africas petition, Civil Case No. 0130, Africa filed a
motion with the Sandiganbayan, alleging that since January 29, 1988 the
PCGG had been illegally exercising the rights of stockholders of ETPI,
[10]
especially in the election of the members of the board of
directors. Africa prayed for the issuance of an order for the calling and
holding of [ETPI] annual stockholders meeting for 1992 under the [c]ourts
control and supervision and prescribed guidelines. [11]
In its November 13, 1992 resolution, the Sandiganbayan favored Africas
motion in this wise:
WHEREFORE, it is ordered that an annual stockholders meeting of the
[ETPI], for 1992 be held on Friday, November 27, 1992, at 2:00 oclock in
the afternoon, at the ETPI Board Room, Telecoms Plaza, 7th Floor, 316 Gil J.
Puyat Avenue, Makati, Metro Manila. x x x The stockholders meeting shall
be conducted under the supervision and control of this Court, through Mr.
Justice Sabino R. de Leon, Jr. [O]nly the registered owners, their duly
authorized representatives or their proxies may vote their corresponding
shares.
The following minimum safeguards must be set in place and carefully
maintained until final judicial resolution of the question of whether or not
the sequestered shares of stock (or in a proper case the underlying assets
of the corporation concerned) constitute ill-gotten wealth[.][12]
The PCGG assailed this resolution before this Court via a petition
for certiorari docketed as G.R. No. 107789[13] (PCGGs petition),
imputing grave abuse of discretion on the Sandiganbayan for holding, inter
alia, that the registered stockholders of ETPI had the right to vote. [14] In
our November 26, 1992 Resolution, we enjoined the Sandiganbayan from
implementing its assailed resolution.
In the meantime, in an April 12, 1993 resolution, the Sandiganbayan
ordered the consolidation of Civil Case No. 0130, among others,
with Civil Case No. 0009, with the latter as the main case and the
former merely an incident.[15]
During the pendency of PCGGs petition (G.R. No. 107789), the PCGG filed
with this Court a Very Urgent Petition for Authority to Hold Special
Stockholders Meeting for [the] Sole Purpose of Increasing [ETPIs]
Authorized Capital Stock (Urgent Petition). In our May 7, 1996 Resolution,
we referred this Urgent Petition to the Sandiganbayan for reception of
evidence and immediate resolution.[16]The Sandiganbayan included the
Urgent Petition in Civil Case No. 0130.[17]
In the proceedings to resolve the Urgent Petition, the testimony of Mr.
Maurice V. Bane (former director and treasurer-in-trust of ETPI) was taken
at the petitioners instance and after serving notice of the deposition-taking
on the respondents[18] on October 23 and 24, 1996 by way of deposition
upon oral examination (Bane deposition) before Consul General Ernesto
Castro of the Philippine Embassy in London, England.
Invoking Section 1, Rule 24 (of the old Rules of Court), purportedly allowing
the petitioner to depose Bane without leave of court, i.e., as a matter
of right after the defendants have filed their answer, the notice
stated that [t]he purpose of the deposition is for [Bane] to identify and
testify on the facts set forth in his affidavit [19] x x x so as to prove the
ownership issue in favor of [the petitioner] and/or establish the prima
facie factual foundation for sequestration of [ETPIs] Class A stock in
support of the [Urgent Petition]. [20] The notice also states that the petitioner
shall use the Bane deposition in evidence in the main case of Civil Case No.
0009.[21] On the scheduled deposition date, only Africa was present and he
cross-examined Bane.
On December 13, 1996, the Sandiganbayan resolved the Urgent Petition by
granting authority to the PCGG (i) to cause the holding of a special
stockholders meeting of ETPI for the sole purpose of increasing ETPIs
authorized capital stock and (ii) to vote therein the sequestered Class A
shares of stock.[22] Thus, a special stockholders meeting was held, as
previously scheduled, on March 17, 1997 and the increase in ETPIs
authorized capital stock was unanimously approved.[23] From this ruling,
Africa went to this Court via a petition for certiorari[24] docketed as G.R.
No. 147214 (Africas petition).
We jointly resolved the PCGGs and Africas petitions, and ruled:
This Court notes that, like in Africas motion to hold a stockholders meeting
(to elect a board of directors), the Sandiganbayan, in the PCGGs petition to
hold a stockholders meeting (to amend the articles of incorporation to
increase the authorized capital stock), again failed to apply the two-tiered
test. On such determination hinges the validity of the votes cast by the
PCGG in the stockholders meeting of March 17, 1997. This lapse by the
Sandiganbayan leaves this Court with no other choice but to remand these
questions to it for proper determination.
xxxx
WHEREFORE, this Court Resolved to REFER the petitions at bar to the
Sandiganbayan for reception of evidence to determine whether there is a
prima facie evidence showing that the sequestered shares in question are
ill-gotten and there is an imminent danger of dissipation to entitle the
PCGG to vote them in a stockholders meeting to elect the ETPI Board of
Directors and to amend the ETPI Articles of Incorporation for the sole
purpose of increasing the authorized capital stock of ETPI.
The Sandiganbayan shall render a decision thereon within sixty (60) days
from receipt of this Resolution and in conformity herewith.
 3. The adverse parties in the aforementioned incidents had the
II. Civil Case No. 0009 opportunity to cross-examine them.

Although Civil Case No. 0009 was filed on July 22, 1987, it was only
on November 29, 1996 and March 17, 1997 that the first pre-trial The respondents filed their respective Oppositions to the 1 st motion;[29] in
conference was scheduled and concluded.[25] turn, the petitioner filed a Common Reply[30] to these Oppositions.

In its Pre-Trial Brief[26] dated August 30, 1996, the petitioner offered to On April 1, 1998, the Sandiganbayan[31] promulgated a resolution[32] (1998
present the following witnesses: resolution) denying the petitioners 1st motion, as follows:

WITNESSES TO BE PRESENTED AND A BRIEF DESCRIPTION OF THEIR Wherefore, the [petitioners] Motion x x x is
TESTIMONIES
1. partly denied insofar as [the petitioner] prays therein to
(1) Maurice V. Bane representative of Cable and Wireless Limited (C & W) adopt the testimonies on oral deposition of Maurice V. Bane and Rolando
at the time ETPI was organized. Gapud as part of its evidence in Civil Case No. 0009 for the reason
that said deponents according to the [petitioner] are not available
xxxx for cross-examination in this Court by the [respondents]. (emphasis
added)
(2) Mr. Manuel H. Nieto x x x
2. partly Granted, in the interest of speedy disposition of this
(3) Ms. Evelyn Singson x x x long pending case, insofar as plaintiff prays therein to adopt
certain/particular testimonies of Cesar O. Parlade, Evelyn Singson, Leoncio
(4) Mr. Severino P. Buan, Jr. x x x Martinez, and Ricardo Castro and documentary exhibits which said
witnesses have identified in incident Civil Case Nos. xxx 0130 xxx, subject
(5) Mr. Apolinario K. Medina - x x x to the following conditions :

(6) Mr. Potenciano A. Roque x x x 1. xxx

2. xxx
(7) Caesar Parlade - x x x 3. That the said witnesses be presented in this Court so that they can
be cross-examined on their particular testimonies in incident Civil Cases
xxx [by the respondents].
IIa. Motion to Admit the Bane Deposition

At the trial of Civil Case No. 0009, the petitioner filed IIb. Urgent Motion and/or Request for Judicial Notice
a Motion[27] (1st motion), stating that
The petitioner did not in any way question the 1998 resolution,
1. In the hearings of the incidents of [Civil Case No. 0009], i.e., Civil and instead made its Formal Offer of Evidence on December 14,
Case Nos. 0048, 0050, 0130, 0146 [28] the following witnesses were 1999.[33] Significantly, the Bane deposition was not included as
presented therein: part of its offered exhibits. Rectifying the omission, the petitioner filed
a. Cesar O.V. Parlade an Urgent Motion and/or Request for Judicial Notice [34] (2nd motion)
b. Maurice Bane dated February 21, 2000, with the alternative prayer that:
c. Evelyn Singson
d. Leonorio Martinez 1. An order forthwith be issued re-opening the plaintiffs case
e. Ricardo Castro; and and setting the same for trial any day in April 2000 for the sole purpose of
f. Rolando Gapud introducing additional evidence and limited only to the marking and
offering of the [Bane deposition] which already forms part of the records
2. [The petitioner] wishes to adopt in [Civil Case No. 0009] their and used in Civil Case No. 0130 x x x;
testimonies and the documentary exhibits presented and identified by 2. In the alternative, x x x the [Sandiganbayan] to take judicial
them, since their testimonies and the said documentary exhibits are very notice of the facts established by the [Bane deposition], together with the
relevant to prove the case of the [petitioner] in [Civil Case No. 0009]. marked exhibits appended thereto. [emphasis ours]
On August 21, 2000, the Sandiganbayan promulgated a resolution [35] (2000
resolution) denying the petitioners 2nd motion:
Judicial notice is found under Rule 129 which is titled What Need Not Be
Proved. Apparently, this provision refers to the Courts duty to consider
admissions made by the parties in the pleadings, or in the course of the
trial or other proceedings in resolving cases before it. The duty of the Court
is mandatory and in those cases where it is discretionary, the initiative is
upon the Court. Such being the case, the Court finds the Urgent Motion
and/or Request for Judicial Notice as something which need not be acted
upon as the same is considered redundant.
On the matter of the [Bane deposition], [its] admission is done
through the ordinary formal offer of exhibits wherein the
defendant is given ample opportunity to raise objection on
grounds provided by law. Definitely, it is not under Article (sic) 129 on
judicial notice. [Emphasis ours]
On November 6, 2000 and on several dates thereafter, the respondents
separately filed their respective demurrers to evidence.[36] On the other
hand, the petitioner moved for the reconsideration of the 2000 resolution,
but was rebuffed by the Sandiganbayan in its April 3,
2001 resolution[37] (2001 resolution).
IIc. Motion to Admit Supplemental Offer of
Evidence (Re: Deposition of Maurice Bane)
On November 16, 2001, the petitioner filed its 3rd Motion, seeking once
more the admission of the Bane deposition. [38] On February 7,
2002 (pending resolution of the respondents demurrers to evidence),
[39]
the Sandiganbayan promulgated the assailed 2002 resolution,
[40]
denying the petitioners 3rd motion. The Sandiganbayan ruled:
But in the courts view, it is not really a question of whether or not plaintiff
has already rested its case as to obviate the further presentation of
evidence. It is not even a question of whether the non-appearing
defendants are deemed to have waived their right to cross-examine Bane
as to qualify the admission of the deposition sans such cross-examination.
Indeed, We do not see any need to dwell on these matters in view of this
Courts Resolution rendered on April 1, 1998 which already denied the
introduction in evidence of Banes deposition and which has become
final in view of plaintiffs failure to file any motion for
reconsideration or appeal within the 15-day reglementary period.
Rightly or wrongly, the resolution stands and for this court to grant
plaintiffs motion at this point in time would in effect sanction plaintiffs
disregard for the rules of procedure. Plaintiff has slept on its rights for
almost two years and it was only in February of 2000 that it sought to
rectify its ineptitude by filing a motion to reopen its case as to enable it to
introduce and offer Banes deposition as additional evidence, or in the
alternative for the court to take judicial notice of the allegations of the
deposition. But how can such a motion be granted when it has been
resolved as early as 1998 that the deposition is inadmissible. Without
plaintiff having moved for reconsideration within the reglementary
period, the resolution has attained finality and its effect cannot be
undone by the simple expedient of filing a motion, which though
purporting to be a novel motion, is in reality a motion for
reconsideration of this courts 1998 ruling. [emphases ours]
The resolution triggered the filing of the present petition.
THE PETITION
The petitioner filed the present petition claiming that the Sandiganbayan
committed grave abuse of discretion:
I.
x x x IN HOLDING THAT ITS INTERLOCUTORY ORDER IN 1998 HAD
BECOME FINAL.
II.
x x x IN x x x REFUSING TO ADMIT THE BANE DEPOSITION WHICH
WAS ALREADY ADMITTED AS EVIDENCE IN AN INCIDENT CASE
(CIVIL CASE NO. 0130) AS PART OF PETITIONERS EVIDENCE IN THE
MAIN x x x CASE (CIVIL CASE NO. 0009).
III.
x x x IN REFUSING TO ADMIT A HIGHLY RELEVANT AND IMPORTANT
PIECE OF EVIDENCE FOR THE PETITIONER ON THE BASIS OF FLIMSY
AND TENUOUS TECHNICAL GROUNDS.
The petitioner[41] argues that the 1998 resolution of the Sandiganbayan is
merely an interlocutory order; thus, the petitioners failure to question this
1998 resolution could not have given it a character of finality so long as
the main case remains pending. [42] On this basis, the petitioner concludes
that the Sandiganbayans denial of its 3rd motion was plainly tainted with
grave abuse of discretion.
On the issue of the Sandiganbayans refusal (in its 2002 resolution) either
to take judicial notice of or to admit the Bane deposition as part of its
evidence, the petitioner asserts that Civil Case No. 0130 (where the Bane
deposition was originally taken, introduced and admitted in evidence) is
but a child of the parent case, Civil Case No. 0009; under this relationship,
evidence offered and admitted in any of the children cases should be
considered as evidence in the parent case.
Lastly, the petitioner claims that given the crucial importance of the Bane
deposition, the Sandiganbayan should not have denied its admission on
flimsy grounds, considering that:
1. It was also already stated in the notice (of the taking of the
Bane deposition) that it would be used as evidence in Civil Case No.
0009. Notices having been duly served on all the parties concerned, they
must accordingly be deemed to have waived their right to cross-examine
the witness when they failed to show up.
2. The Bane deposition was a very vital cog in the case of the
petitioner relative to its allegation that the respondents interest in ETPI and
related firms properly belongs to the government.
3. The non-inclusion of the Bane deposition in the petitioners
formal offer of evidence was obviously excusable considering the period
that had lapsed from the time the case was filed and the voluminous
records that the present case has generated.[43]
THE RESPONDENTS COMMENTS
and THE PETITIONERS REPLY
In the respondents Comments[44] (filed in compliance with our Resolution
of April 10, 2002[45]), they claim that the present petition was filed out of
time - i.e., beyond the 60-day reglementary period prescribed under
Section 4, Rule 65 of the Rules of Court. [46] This assertion proceeds from the
view that the petitioners 3rd motion, being a mere rehash of similar motions
earlier filed by the petitioner, likewise simply assails the Sandiganbayans
1998 resolution. Along the same line, they posit that the petitioners
3rd motion actually partakes of a proscribed third motion for
reconsideration of the Sandiganbayans 1998 resolution. [47] They likewise
assert, on the assumption that the 1998 resolution is interlocutory in
character, that the petitioners failure to contest the resolution by way
of certiorari within the proper period gave the 1998 resolution a character
of finality.
The respondents further claim that after a party has rested its case, the
admission of a supplemental offer of evidence requires the reopening of
the case at the discretion of the trial court; the Sandiganbayan simply
exercised its sound discretion in refusing to reopen the case since the
evidence sought to be admitted was within the knowledge of the
[petitioner] and available to [it] before [it] rested its case. [48] The
respondents also advert to the belated filing of the petitioners
3rd motion i.e., after the respondents had filed their respective demurrers
to evidence.
On the petitioners claim of waiver, the respondents assert that they have
not waived their right to cross-examine the deponent; the Sandiganbayan
recognized this right in its 1998 resolution and the petitioner never
questioned this recognition. They also assert that the allegations in the
Bane deposition cannot be a proper subject of judicial notice under Rule
129 of the Rules of Court. The respondents lastly submit that the Bane
deposition is inadmissible in evidence because the petitioner failed to
comply with the requisites for admission under Section 47, Rule 130 of the
Rules of Court.
In its Reply,[49] the petitioner defends the timeliness of the present petition
by arguing that a party may opt to wait out and collect a pattern of
questionable acts before resorting to the extraordinary remedy
of certiorari. The petitioner stresses that it filed the 3 rd motion precisely
because of the Sandiganbayans 2000 resolution, which held that the
admission of the Bane deposition should be done through the ordinary
formal offer of evidence. Thus, the Sandiganbayan seriously erred in
considering the petitioners 3rd motion as a proscribed motion for
reconsideration. The petitioner generally submits that the dictates of
substantial justice should have guided the Sandiganbayan to rule
otherwise.
The petitioner also clarifies that it has not yet rested its case although it
has filed a formal offer of evidence. A party normally rests his case
only after the admission of the pieces of evidence he formally offered;
before then, he still has the opportunity to present further evidence to
substantiate his theory of the case should the court reject any piece of the
offered evidence.[50]
The petitioner further maintains that the mere reasonable opportunity to
cross-examine the deponent is sufficient for the admission of the Bane
deposition considering that the deponent is not an ordinary witness who
can be easily summoned by our courts in light of his foreign residence, his
citizenship, and his advanced age. The petitioner asserts that Rule 24 (now
Rule 23), and not Section 47, Rule 130, of the Rules of Court should apply
to the present case, as explicitly stated in the notice of the deposition-
taking.
To date, respondents Imelda Marcos and the heirs of Potenciano Ilusorio
have yet to file their respective comments on the petition. Given the time
that had lapsed since we required their comments, we resolve to dispense
with the filing of these comments and to consider this petition submitted
for decision.
THE ISSUES
On the basis of the pleadings, we summarize the pivotal issues for our
resolution, as follows:
1. Whether the petition was filed within the required period.
2. Whether the Sandiganbayan committed grave abuse of discretion
i. In holding that the 1998 resolution has
already attained finality;
 ii. In holding that the petitioners 3 rd motion
partakes of a prohibited motion for reconsideration;
iii. In refusing to re-open the case given the
critical importance of the Bane deposition to the petitioners cause; and
iv. In refusing to admit the Bane deposition
notwithstanding the prior consolidation of Civil Case No. 0009 and Civil
Case No. 0130.
3. Whether the Bane deposition is admissible under -
i. Rule 23, Section 4, par. (c) alone or in relation to Section 47, Rule 130 of
the Rules of Court; and
ii. The principle of judicial notice.
THE COURTS RULING
We deny the petition for lack of merit.
I. Preliminary Considerations
I (a). The interlocutory nature of the Sandiganbayans 1998
resolution.
In determining the appropriate remedy or remedies available, a party
aggrieved by a court order, resolution or decision must first correctly
identify the nature of the order, resolution or decision he intends to assail.
[51]
In this case, we must preliminarily determine whether the 1998
resolution is final or interlocutory in nature.
Case law has conveniently demarcated the line between a final judgment
or order and an interlocutory one on the basis of the disposition made. [52] A
judgment or order is considered final if the order disposes of the action or
proceeding completely, or terminates a particular stage of the same
action; in such case, the remedy available to an aggrieved party is appeal.
If the order or resolution, however, merely resolves incidental matters and
leaves something more to be done to resolve the merits of the case, the
order is interlocutory[53] and the aggrieved partys remedy is a petition
for certiorari under Rule 65.Jurisprudence pointedly holds that:
As distinguished from a final order which disposes of the subject matter in
its entirety or terminates a particular proceeding or action, leaving nothing
else to be done but to enforce by execution what has been determined by
the court, an interlocutory order does not dispose of a case completely, but
leaves something more to be adjudicated upon. The term final judgment or
order signifies a judgment or an order which disposes of the case as to all
the parties, reserving no further questions or directions for future
determination.
On the other hand, a court order is merely interlocutory in character if it
leaves substantial proceedings yet to be had in connection with the
controversy. It does not end the task of the court in adjudicating the
parties contentions and determining their rights and liabilities as against
each other. In this sense, it is basically provisional in its application.
[54]
(emphasis supplied)
Under these guidelines, we agree with the petitioner that the 1998
resolution is interlocutory. The Sandiganbayans denial of the petitioners
1st motion through the 1998 Resolution came at a time when the petitioner
had not even concluded the presentation of its evidence. Plainly, the denial
of the motion did not resolve the merits of the case, as something still had
to be done to achieve this end.
We clarify, too, that an interlocutory order remains under the control of the
court until the case is finally resolved on the merits. The court may
therefore modify or rescind the order upon sufficient grounds shown at any
time before final judgment. [55] In this light, the Sandiganbayans 1998
resolution which merely denied the adoption of the Bane deposition as part
of the evidence in Civil Case No. 0009 could not have attained finality (in
the manner that a decision or final order resolving the case on the merits
does) despite the petitioners failure to move for its reconsideration or to
appeal.[56]
I (b). The 3rd motion was not prohibited by the Rules.
We also agree with the petitioner that its 3 rd motion cannot be considered
as a proscribed third (actually second) motion for reconsideration of the
Sandiganbayans 1998 resolution. As Section 5, Rule 37 of the Rules of
Court clearly provides, the proscription against a second motion for
reconsideration is directed against a judgment or final order. Although a
second motion for reconsideration of an interlocutory order can be denied
on the ground that it is a mere "rehash" of the arguments already passed
upon and resolved by the court, it cannot be rejected on the ground that it
is forbidden by the law or by the rules as a prohibited motion. [57]
I (c). The 1998 resolution was not ripe for a petition for certiorari.
Under Section 1, Rule 41 of the Rules of Court, an aggrieved party may
appeal from a judgment or final order which completely disposes of a
case or from an order that the Rules of Court declares to be appealable.
While this provision prohibits an appeal from an interlocutory order, the
aggrieved party is afforded the chance to question an interlocutory order
through a special civil action of certiorari under Rule 65; the petition must
be filed within sixty days from notice of the assailed judgment, order,
resolution, or denial of a motion for reconsideration.
On the premise that the 1998 resolution is interlocutory in nature, the
respondents insist that the 60-day period for filing a petition
for certiorari should be reckoned from the petitioners notice of the
Sandiganbayans 1998 resolution. They argue that since this ruling had long
been rendered by the court, the petitioners subsequent filing of similar
motions was actually a devious attempt to resuscitate the long-denied
admission of the Bane deposition.
We do not find the respondents submission meritorious. While the 1998
resolution is an interlocutory order, as correctly argued by the petitioner
and impliedly conceded by the respondents, the claim that the 1998
resolution should have been immediately questioned by the petitioner
on certiorari is not totally correct as a petition for certiorari is not grounded
solely on the issuance of a disputed interlocutory ruling. [58] For a petition
for certiorari to prosper, Section 1, Rule 65 of the Rules of Court requires,
among others, that neither an appeal nor any plain, speedy and
adequate remedy in the ordinary course of law is available to the
aggrieved party. As a matter of exception, the writ of certiorari may issue
notwithstanding the existence of an available alternative remedy, if such
remedy is inadequate or insufficient in relieving the aggrieved party of the
injurious effects of the order complained of.[59]
We note that at the time of its 1st motion in Civil Case No. 0009, the
petitioner had not yet concluded the presentation of its evidence, much
less made any formal offer of evidence. At this stage of the case, the
prematurity of using the extraordinary remedy of certiorari to question the
admission of the Bane deposition is obvious. After the denial of the
1st motion, the plain remedy available to the petitioner was to move for a
reconsideration to assert and even clarify its position on the admission of
the Bane deposition. The petitioner could introduce [60] anew the Bane
deposition and include this as evidence in its formal offer [61] as the
petitioner presumably did in Civil Case No. 0130.
Thus, at that point, the case was not yet ripe for the filing of a petition
for certiorari, and the denial of the 1st motion could not have been the
reckoning point for the period of filing such a petition.
II. The Sandiganbayans ruling on the finality of its 1998 resolution
was legally erroneous but did not constitute grave abuse of
discretion
In light of the above discussions and conclusions, the Sandiganbayan
undoubtedly erred on a question of law in its ruling, but this legal error
did not necessarily amount to a grave abuse of discretion in the absence of
a clear showing that its action was a capricious and whimsical exercise of
judgment affecting its exercise of jurisdiction. [62] Without this showing, the
Sandiganbayans erroneous legal conclusion was only an error of
judgment, or, at best, an abuse of discretion but not a grave one. For this
reason alone, the petition should be dismissed.
Despite this conclusion, however, we opt not to immediately dismiss the
petition in light of the unique circumstances of this case where the
petitioner cannot entirely be faulted for not availing of the remedy at the
opportune time, and where the case, by its nature, is undoubtedly
endowed with public interest and has become a matter of public concern.
[63]
In other words, we opt to resolve the petition on the merits to lay the
issues raised to rest and to avoid their recurrence in the course of
completely resolving the merits of Civil Case No. 0009.
Although the word rested nowhere appears in the Rules of Court, ordinary
court procedure has inferred it from an overview of trial sequence
under Section 5, Rule 30 (which capsulizes the order of presentation of a
partys evidence during trial), read in relation to Rule 18 on Pre-Trial, [64] both
of the Rules of Court. Under Section 5, Rule 30, after a party has adduced
his direct evidence in the course of discharging the burden of proof, [65] he is
considered to have rested his case, and is thereafter allowed to offer
rebutting evidence only.[66] Whether a party has rested his case in some
measure depends on his manifestation in court on whether he has
concluded his presentation of evidence. [67]
In its second and third motions, respectively, the petitioner expressly
admitted that due to oversight, [the petitioner] closed and rested its case;
[68]
and that it had terminated the presentation of its evidence in x x x Civil
Case No. 0009.[69] In the face of these categorical judicial admissions,
[70]
the petitioner cannot suddenly make an about-face and insist on the
introduction of evidence out of the usual order. Contrary to the petitioners
assertion, the resting of its case could not have been conditioned on the
admission of the evidence it formally offered. To begin with, the Bane
deposition, which is the lonepiece of evidence subject of this present
petition, was not among the pieces of evidence included in its formal offer
of evidence and thus could not have been admitted or rejected by the trial
court.
The Court observes with interest that it was only in this present petition
for certiorari that the petitioner had firmly denied having rested its case.
[71]
Before then, the petitioner never found it appropriate to question
on certiorari the Sandiganbayans denial of its 2nd motion which
prayed, inter alia, for the reopening of the case. This is a fatal defect in
the petitioners case.
Although the denial of the petitioners first motion did not necessitate an
immediate recourse to the corrective writ of certiorari, the denial of the
2nd motion dictated a different course of action. The petitioners non-
observance of the proper procedure for the admission of the Bane
deposition, while seemingly innocuous, carried fatal implications for its
case. Having been rebuffed on its first attempt to have the Bane deposition
adopted in Civil Case No. 0009, and without seeking reconsideration of the
denial, the petitioner presented its other pieces of evidence and
eventually rested its case. This time, the petitioner forgot about the Bane
deposition and so failed to include that piece of evidence in its formal offer
of evidence.
More than two years later, the petitioner again tried to squeeze in the Bane
deposition into its case. In resolving the petitioners motion for
reconsideration of the Sandiganbayans 2000 resolution, the
Sandiganbayan held that the Bane deposition has become part and parcel
of Civil Case No. 0009. This pronouncement has obscured the real status of
the Bane deposition as evidence (considering that, earlier, the
Sandiganbayan already denied the petitioners attempt to adopt the Bane
deposition as evidence in Civil Case No. 0009 for the deponent cannot be
cross-examined in court). Nevertheless, the Sandiganbayan ultimately
denied the petitioners motion to reopen the case. Having judicially
admitted the resting of its case, the petitioner should have already
questioned the denial of its 2nd motion by way of certiorari, since the denial
of its attempt to reopen the case effectively foreclosed all avenues
available to it for the consideration of the Bane deposition. Instead of doing
so, however, the petitioner allowed the 60-day reglementary period,
under Section 4, Rule 65 of the Rules of Court, to lapse, and
proceeded to file its 3rd motion.
Significantly, the petitioner changed its legal position in its 3 rd motion by
denying having rested its case and insisting on the introduction of the
Bane deposition. Rebuffed once more, the petitioner filed the present
petition, inviting our attention to the Sandiganbayans resolutions, [72] which
allegedly gave it mixed signals. [73] By pointing to these resolutions,
ironically, even the petitioner impliedly recognized that they were then
already ripe for review on certiorari. What the petitioner should have
realized was that its 2nd motion unequivocally aimed to reopen the case for
the introduction of further evidence consisting of the Bane deposition.
Having been ultimately denied by the court, the petitioner could not have
been prevented from taking the proper remedy notwithstanding any
perceived ambiguity in the resolutions.
On the other end, though, there was nothing intrinsically objectionable in
the petitioners motion to reopen its case before the court ruled on its
formal offer of evidence. The Rules of Court does not prohibit a party from
requesting the court to allow it to present additional evidence even after it
has rested its case. Any such opportunity, however, for the ultimate
purpose of the admission of additional evidence is already addressed to
the sound discretion of the court. It is from the prism of the exercise of this
discretion that the Sandiganbayans refusal to reopen the case (for the
purpose of introducing, marking and offering additional evidence) should
be viewed. We can declare this Sandiganbayan action invalid if it had acted
with grave abuse of discretion.
III. The Sandiganbayan gravely abused its discretion in ultimately
refusing to reopen the case for the purpose of introducing and
admitting in evidence the Bane deposition
The basis for a motion to reopen a case to introduce further evidence is
Section 5, Rule 30 of the Rules of Court, which reads:
Sec. 5. Order of trial. Subject to the provisions of section 2 of Rule 31, and
unless the court for special reasons otherwise directs, the trial shall be
limited to the issues stated in the pre-trial order and shall proceed as
follows:
xxxx
(f) The parties may then respectively adduce rebutting evidence
only, unless the court, for good reasons and in the furtherance of
justice, permits them to adduce evidence upon their original
case[.] [emphases ours]
Under this rule, a party who has the burden of proof must introduce, at the
first instance, all the evidence he relies upon [74] and such evidence cannot
be given piecemeal.[75] The obvious rationale of the requirement is to avoid
injurious surprises to the other party and the consequent delay in the
administration of justice.[76]
A partys declaration of the completion of the presentation of his evidence
prevents him from introducing further evidence;[77] but where the evidence
is rebuttal in character, whose necessity, for instance, arose from the
shifting of the burden of evidence from one party to the other; [78] or where
the evidence sought to be presented is in the nature of newly
discovered evidence,[79] the partys right to introduce further evidence must
be recognized. Otherwise, the aggrieved party may avail of the remedy
of certiorari.
Largely, the exercise of the courts discretion [80] under the exception of
Section 5(f), Rule 30 of the Rules of Court depends on the attendant
facts i.e., on whether the evidence would qualify as a good reason and be
in furtherance of the interest of justice. For a reviewing court to properly
interfere with the lower courts exercise of discretion, the petitioner must
show that the lower courts action was attended by grave abuse of
discretion. Settled jurisprudence has defined this term as the capricious
and whimsical exercise of judgment, equivalent to lack of jurisdiction; or,
the exercise of power in an arbitrary manner by reason of passion,
prejudice, or personal hostility, so patent or so gross as to amount to an
evasion of a positive duty, to a virtual refusal to perform the mandated
duty, or to act at all in contemplation of the law. [81] Grave abuse of
discretion goes beyond the bare and unsupported imputation of caprice,
whimsicality or arbitrariness, and beyond allegations that merely
constitute errors of judgment[82] or mere abuse of discretion.[83]
In Lopez v. Liboro,[84] we had occasion to make the following
pronouncement:
After the parties have produced their respective direct proofs, they are
allowed to offer rebutting evidence only, but, it has been held, the court,
for good reasons, in the furtherance of justice, may permit them to offer
evidence upon their original case, and its ruling will not be disturbed in the
appellate court where no abuse of discretion appears. So, generally,
additional evidence is allowed when it is newly discovered, or where it
has been omitted through inadvertence or mistake, or where the
purpose of the evidence is to correct evidence previously offered. The
omission to present evidence on the testator's knowledge of Spanish had
not been deliberate. It was due to a misapprehension or oversight.
(citations omitted; emphases ours)
Likewise, in Director of Lands v. Roman Archbishop of Manila,[85] we ruled:
The strict rule is that the plaintiff must try his case out when he
commences. Nevertheless, a relaxation of the rule is permitted in the
sound discretion of the court. The proper rule for the exercise of this
discretion, it has been said by an eminent author, is, that material
testimony should not be excluded because offered by the plaintiff
after the defendant has rested, although not in rebuttal, unless it
has been kept back by a trick, and for the purpose of deceiving
the defendant and affecting his case injuriously.
These principles find their echo in Philippine remedial law. While the
general rule is rightly recognized, the Code of Civil Procedure authorizes
the judge for special reasons, to change the order of the trial, and "for
good reason, in the furtherance of justice," to permit the parties to offer
evidence upon their original case. These exceptions are made stronger
when one considers the character of registration proceedings and the fact
that where so many parties are involved, and action is taken quickly and
abruptly, conformity with precise legal rules should not always be
expected. Even at the risk of violating legal formul, an opportunity
should be given to parties to submit additional corroborative
evidence in support of their claims of title, if the ends of justice so
require. (emphases ours)
In his commentaries, Chief Justice Moran had this to say:
However, the court for good reasons, may, in the furtherance of justice,
permit the parties to offer evidence upon their original case, and its ruling
will not be disturbed where no abuse of discretion appears,
Generally, additional evidence is allowed when x x x; but it may be
properly disallowed where it was withheld deliberately and
without justification.[86]
The weight of the exception is also recognized in foreign jurisprudence. [87]
Under these guidelines, we hold that the Sandiganbayan gravely
abused its discretion in refusing to reopen the case. Instead of
squarely ruling on the petitioners 2 nd motion to avoid any uncertainty on
the evidentiary status of the Bane deposition, the Sandiganbayans
action actually left the petitioners concern in limbo by considering the
petitioners motion redundant. This is tantamount to a refusal to undertake
a positive duty as mandated by the circumstances and is equivalent to an
act outside the contemplation of law.
It has not escaped our notice that at the time the petitioner moved to re-
open its case, the respondents had not yet even presented their evidence
in chief. The respondents, therefore, would not have been prejudiced by
allowing the petitioners introduction of the Bane deposition, which was
concededly omitted through oversight.[88] The higher interest of substantial
justice, of course, is another consideration that cannot be taken lightly. [89]
In light of these circumstances, the Sandiganbayan should not have
perfunctorily applied Section 5, Rule 30 of the Rules of Court on the
petitioners request to reopen the case for the submission of the Bane
deposition.
On the basis of this conclusion, a remand of this case should follow as a
matter of course. The state of the parties submissions and the delay that
has already attended this aspect of Civil Case No. 0009, however, dictate
against this obvious course of action. At this point, the parties have more
than extensively argued for or against the admission of the Bane
deposition. Civil Case No. 0009 is a 25-year old sequestration case that is
now crying out for complete resolution. Admissibility, too, is an issue that
would have again been raised on remand and would surely stare us in the
face after remand.[90] We are thus left with no choice but to resolve the
issue of admissibility of the Bane deposition here and now.
IV. The admissibility of the Bane deposition
IV (a). The consolidation of Civil Case No. 0009 and Civil Case No.
0130 did not dispense with the usual requisites of admissibility
In support of its 3rd motion, the petitioner argues that the Bane deposition
can be admitted in evidence without observing the provisions of Section
47, Rule 130 of the Rules of Court.[91] The petitioner claims that in light of
the prior consolidation of Civil Case No. 0009 and Civil Case No. 0130,
among others,[92] the former case or proceeding that Section 47, Rule 130
speaks of no longer exists.
Rule 31 of the old Rules of Court [93] the rule in effect at the time Civil Case
Nos. 0009 and 0130 were consolidated provided that:
Rule 31
Consolidation or Severance
Section 1. Consolidation. When actions involving a common question of
law or fact are pending before the court, it may order a joint hearing or
trial of any or all the matters in issue in the actions; it may order all the
actions consolidated; and it may make such orders concerning
proceedings therein as may tend to avoid unnecessary costs or delay.
[94]
(emphases ours)
Consolidation is a procedural device granted to the court as an aid in
deciding how cases in its docket are to be tried so that the business
of the court may be dispatched expeditiously and with economy while
providing justice to the parties. To promote this end, the rule permits the
consolidation and a single trial of several cases in the courts docket, or the
consolidation of issues within those cases.[95]
A reading of Rule 31 of the Rules of Court easily lends itself to two
observations. First, Rule 31 is completely silent on the effect/s of
consolidation on the cases consolidated; on the parties and the causes of
action involved; and on the evidence presented in the consolidated
cases. Second, while Rule 31 gives the court the discretion either to order a
joint hearing or trial, or to order the actions consolidated, jurisprudence will
show that the term consolidation is used generically and even
synonymously with joint hearing or trial of several causes. [96] In fact, the
title consolidation of Rule 31 covers all the different senses of
consolidation, as discussed below.
These observations are not without practical reason. Considering that
consolidation is basically a function given to the court, the latter is in the
best position to determine for itself (given the nature of the cases, the
complexity of the issues involved, the parties affected, and the courts
capability and resources vis--vis all the official business pending before it,
among other things) what consolidation will bring, bearing in mind the
rights of the parties appearing before it.
To disregard the kind of consolidation effected by the
Sandiganbayan on the simple and convenient premise that the
deposition-taking took place after the Sandiganbayan ordered the
consolidation is to beg the question. It is precisely the silence of
our Rules of Procedure and the dearth of applicable case law on
the effect of consolidation that strongly compel this Court to
determine the kind of consolidation effected to directly resolve
the very issue of admissibility in this case.
In the context of legal procedure, the term consolidation is used in three
different senses:[97]
(1) Where all except one of several actions are stayed until one is
tried, in which case the judgment in the one trial is conclusive as to the
others. This is not actually consolidation but is referred to as such. (quasi-
consolidation)[98]
(2) Where several actions are combined into one, lose their
separate identity, and become a single action in which a single judgment is
rendered. This is illustrated by a situation where several actions are
pending between the same parties stating claims which might have been
set out originally in one complaint. (actual consolidation)[99]
(3) Where several actions are ordered to be tried together but
each retains its separate character and requires the entry of a separate
judgment. This type of consolidation does not merge the suits into a single
action, or cause the parties to one action to be parties to the other.
(consolidation for trial)[100]
Considering that the Sandiganbayans order[101] to consolidate several
incident cases does not at all provide a hint on the extent of the courts
exercise of its discretion as to the effects of the consolidation it ordered in
view of the function of this procedural device to principally aid the court
itself in dealing with its official business we are compelled to look deeper
into the voluminous records of the proceedings conducted below. We note
that there is nothing that would even suggest that the Sandiganbayan in
fact intended a merger of causes of action, parties and evidence. [102] To be
sure, there would have been no need for a motion to adopt (which did not
remain unopposed) the testimonies in the incident cases had a merger
actually resulted from the order of consolidation, for in that case, the
Sandiganbayan can already take judicial notice of the same.
Significantly, even the petitioner itself viewed consolidation, at
most, to be merely a consolidation for trial.[103] Accordingly, despite
the consolidation in 1993, the petitioner acceded to the Sandiganbayans
1998 Resolution (which denied the petitioners 1 st Motion on the ground
that the witnesses, whose testimony in the incident cases is sought to be
adopted, are not available for cross-examination in the Sandiganbayan) by
presenting these other witnesses again in the main case, so that the
respondents can cross-examine them.
These considerations run counter to the conclusion that the
Sandiganbayans order of consolidation had actually resulted in the
complete merger of the incident cases with the main case, in the sense of
actual consolidation, and that the parties in these consolidated cases had
(at least constructively) been aware of and had allowed actual
consolidation without objection.[104]
Considering, too, that the consolidated actions were originally independent
of one another and the fact that in the present case the party respondents
to Civil Case No. 0009 (an action for reconveyance, accounting, restitution
and damages) are not parties to Civil Case No. 0130 (a special civil action
filed by an ETPI stockholder involving a corporate squabble within ETPI),
the conclusion that the Sandiganbayan in fact intended an actual
consolidation and, together with the parties affected,[105] acted towards
that end - where the actions become fused and unidentifiable from one
another and where the evidence appreciated in one action is also
appreciated in another action must find support in the proceedings held
below. This is particularly true in a case with the magnitude and complexity
of the present case. Otherwise, to impose upon the respondents the effects
of an actual consolidation (which find no clear support in the provisions of
the Rules of Court, jurisprudence,[106] and even in the proceedings before
the Sandiganbayan itself and despite the aforementioned considerations)
results in an outright deprivation of the petitioners right to due process. We
reach this conclusion especially where the evidence sought to be admitted
is not simply a testimony taken in one of the several cases, but a
deposition upon oral examination taken in another jurisdiction and whose
admission is governed by specific provisions on our rules on evidence.
We stress on this point, too, that while the Sandiganbayan ordered the
consolidation in 1993 (that is, before the deposition was taken), neither
does the Pre-Trial Order[107] issued by the Sandiganbayan in 1997 in Civil
Case No. 0009 contain any reference, formal or substantive, to Civil Case
No. 0130.[108] Interestingly, in its Pre-Trial Brief dated August 30, 1996,
[109]
the petitioner even made a representation to present Bane as one of
its witnesses.
IV (b). Use of deposition under Section 4, Rule 23 and as a former
testimony under Section 47, Rule 130
Since the present consolidation did not affect Civil Case No. 0130 as an
original, albeit incidental, case, the admissibility of the Bane deposition
cannot avoid being measured against the requirements of Section 47, Rule
130 of the Rules of Court the rule on the admissibility of testimonies or
deposition taken in a different proceeding. In this regard, the petitioner
argues that Section 4, Rule 23 of the Rules of Court (then Rule 24) [110] must,
at any rate, prevail over Section 47, Rule 130[111] of the same Rules.
At the outset, we note that when the petitioners motion to adopt the
testimonies taken in the incident cases drew individual oppositions from
the respondents, the petitioner represented to the Sandiganbayan its
willingness to comply with the provisions of Section 47, Rule 130 of the
Rules of Court,[112] and, in fact, again presented some of the witnesses. The
petitioners about-face two years thereafter even contributed to the
Sandiganbayans own inconsistency on how to treat the Bane deposition, in
particular, as evidence.
Section 4, Rule 23 of the Rules of Court on Deposition Pending Action
(deposition de bene esse) provides for the circumstances when depositions
may be used in the trial, or at the hearing of a motion or an interlocutory
proceeding.
SEC. 4. Use of depositions. At the trial or upon the hearing of a motion
or an interlocutory proceeding, any part or all of a deposition, so far as
admissible under the rules of evidence, may be used against any
party who was present or represented at the taking of the deposition or
who had due notice thereof, in accordance with any one of the following
provisions:
xxxx
(c) The deposition of a witness, whether or not a party, may be used by
any party for any purpose if the court finds: (1) that the witness is
dead; or (2) that the witness resides at a distance more than one hundred
(100) kilometers from the place of trial or hearing, or is out of the
Philippines, unless it appears that his absence was procured by the party
offering the deposition; or (3) that the witness is unable to attend or testify
because of age, sickness, infirmity, or imprisonment; or (4) that the party
offering the deposition has been unable to procure the attendance of the
witness by subpoena; or (5) upon application and notice, that such
exceptional circumstances exist as to make it desirable, in the interest of
justice and with due regard to the importance of presenting the testimony
of witnesses orally in open court, to allow the deposition to be
used[.] [emphasis ours]
On the other hand, Section 47, Rule 130 of the Rules of Court provides:
SEC. 47. Testimony or deposition at a former proceeding. The
testimony or deposition of a witness deceased or unable to testify, given in
a former case or proceeding, judicial or administrative, involving the same
parties and subject matter, may be given in evidence against the
adverse party who had the opportunity to cross-examine him.
A plain reading of Rule 23 of the Rules of Court readily rejects the
petitioners position that the Bane deposition can be admitted into evidence
without observing the requirements of Section 47, Rule 130 of the Rules of
Court.
Before a party can make use of the deposition taken at the trial of a
pending action, Section 4, Rule 23 of the Rules of Court does not only
require due observance of its sub-paragraphs (a) to (d); it also requires, as
a condition for admissibility, compliance with the rules on evidence. Thus,
even Section 4, Rule 23 of the Rules of Court makes an implied reference
to Section 47, Rule 130 of the Rules of Court before the deposition may
be used in evidence. By reading Rule 23 in isolation, the petitioner failed
to recognize that the principle conceding admissibility to a deposition
under Rule 23 should be consistent with the rules on evidence under
Section 47, Rule 130.[113] In determining the admissibility of the Bane
deposition, therefore, reliance cannot be given on one provision to the
exclusion of the other; bothprovisions must be considered. This is
particularly true in this case where the evidence in the prior proceeding
does not simply refer to a witness testimony in open court but to a
deposition taken under another and farther jurisdiction.
A common thread that runs from Section 4, Rule 23 of the Rules of Court
and Section 47, Rule 130 of the same Rules is their mutual reference to
depositions.
A deposition is chiefly a mode of discovery whose primary function is to
supplement the pleadings for the purpose of disclosing the real points of
dispute between the parties and affording an adequate factual basis during
the preparation for trial.[114] Since depositions are principally made
available to the parties as a means of informing themselves of all the
relevant facts, depositions are not meant as substitute for the
actual testimony in open court of a party or witness. Generally, the
deponent must be presented for oral examination in open court at the trial
or hearing. This is a requirement of the rules on evidence under Section 1,
Rule 132 of the Rules of Court.[115]
Examination to be done in open court. The examination of witnesses
presented in a trial or hearing shall be done in open court, and under oath
or affirmation. Unless the witness is incapacitated to speak, or the question
calls for a different mode of answer, the answers of the witness shall be
given orally.
Indeed, any deposition offered to prove the facts set forth therein, in lieu of
the actual oral testimony of the deponent in open court, may be opposed
by the adverse party and excluded under the hearsay rule i.e., that the
adverse party had or has no opportunity to cross-examine the deponent at
the time that his testimony is offered. That opportunity for cross-
examination was afforded during the taking of the deposition
alone is no argument, as the opportunity for cross-examination
must normally be accorded a party at the time that the testimonial
evidence is actually presented against him during the trial or
hearing of a case.[116] However, under certain conditions and for
certain limited purposes laid down in Section 4, Rule 23 of the Rules of
Court, the deposition may be used without the deponent being actually
called to the witness stand.[117]
Section 47, Rule 130 of the Rules of Court is an entirely different
provision. While a former testimony or deposition appears under
the Exceptions to the Hearsay Rule, the classification of former testimony
or deposition as an admissible hearsay is not universally conceded. [118] A
fundamental characteristic of hearsay evidence is the adverse partys lack
of opportunity to cross-examine the out-of-court declarant. However,
Section 47, Rule 130 explicitly requires, inter alia, for the admissibility of
a former testimony or deposition that the adverse party must have had an
opportunity to cross-examine the witness or the deponent in the prior
proceeding.
This opportunity to cross-examine though is not the ordinary cross-
examination[119] afforded an adverse party in usual trials regarding matters
stated in the direct examination or connected therewith. Section 47, Rule
130 of the Rules of Court contemplates a different kind of cross-
examination, whether actual or a mere opportunity, whose
adequacy depends on the requisite identity of issues in the former case or
proceeding and in the present case where the former testimony or
deposition is sought to be introduced.
Section 47, Rule 130 requires that the issues involved in both cases must,
at least, be substantially the same; otherwise, there is no basis in saying
that the former statement was - or would have been - sufficiently tested by
cross-examination or by an opportunity to do so. [120] (The requirement of
similarity though does not mean that all the issues in the two proceedings
should be the same.[121] Although some issues may not be the same in the
two actions, the admissibility of a former testimony on an issue which is
similar in both actions cannot be questioned.[122])
These considerations, among others, make Section 47, Rule 130 a distinct
rule on evidence and therefore should not be confused with the general
provisions on deposition under Rule 23 of the Rules of Court. In other
words, even if the petitioner complies with Rule 23 of the Rules of Court on
the use of depositions, the observance of Section 47, Rule 130 of the Rules
of Court cannot simply be avoided or disregarded.
Undisputably, the Sandiganbayan relied on the Bane deposition, taken in
Civil Case No. 0130, for purposes of this very same case. Thus, what the
petitioner established and what the Sandiganbayan found, for purposes of
using the Bane deposition, refer only to the circumstances laid down under
Section 4(c), Rule 23 of the Rules of Court, not necessarily to those of
Section 47, Rule 130 of the Rules of Court, as a distinct rule on evidence
that imposes further requirements in the use of depositions in
a different case or proceeding. In other words, the prior use of the
deposition under Section 4(c), Rule 23 cannot be taken as compliance with
Section 47, Rule 130 which considers the same deposition as hearsay,
unless the requisites for its admission under this rule are observed. The
aching question is whether the petitioner complied with the latter rule.
Section 47, Rule 130 of the Rules of Court lays down the following
requisites for the admission of a testimony or deposition given at a former
case or proceeding.
1. The testimony or deposition of a witness deceased or otherwise
unable to testify;
2. The testimony was given in a former case or proceeding, judicial or
administrative;
3. Involving the same parties;
4. Relating to the same matter;
5. The adverse party having had the opportunity to cross-examine him.
[123]
The reasons for the admissibility of testimony or deposition taken at a
former trial or proceeding are the necessity for the testimony and its
trustworthiness.[124] However, before the former testimony or
deposition can be introduced in evidence, the proponent must first lay the
proper predicate therefor,[125] i.e., the party must establish the basis for the
admission of the Bane deposition in the realm of admissible evidence. This
basis is the prior issue that we must now examine and resolve.
IV (c). Unavailability of witness
For the admission of a former testimony or deposition, Section 47, Rule 130
of the Rules of Court simply requires, inter alia, that the witness or
deponent be deceased or unable to testify. On the other hand, in using a
deposition that was taken during the pendency of an action, Section 4,
Rule 23 of the Rules of Court provides several grounds that will justify
dispensing with the actual testimony of the deponent in open court and
specifies, inter alia, the circumstances of the deponents inability to attend
or testify, as follows:
(3) that the witness is unable to attend or testify because of age,
sickness, infirmity, or imprisonment[.] [emphases ours][126]
The phrase unable to testify appearing in both Rule 23 and Rule 130 of the
Rules of Court refers to a physical inability to appear at the witness stand
and to give a testimony.[127] Hence notwithstanding the deletion of the
phrase out of the Philippines, which previously appeared in Section 47,
Rule 130 of the Rules of Court, absence from jurisdiction[128] - the
petitioners excuse for the non-presentation of Bane in open court - may
still constitute inability to testify under the same rule. This is not to say,
however, that resort to deposition on this instance of unavailability will
always be upheld. Where the deposition is taken not for discovery
purposes, but to accommodate the deponent, then the deposition
should be rejected in evidence.[129]
Although the testimony of a witness has been given in the course of a
former proceeding between the parties to a case on trial, this testimony
alone is not a ground for its admission in evidence. The witness himself, if
available, must be produced in court as if he were testifying de novo since
his testimony given at the former trial is mere hearsay. [130] The deposition
of a witness, otherwise available, is also inadmissible for the same reason.
Indeed, the Sandiganbayans reliance on the Bane deposition in
the other case (Civil Case No. 0130) is an argument in favor of the requisite
unavailability of the witness. For purposes of the present case (Civil Case
No. 0009), however, the Sandiganbayan would have no basis to presume,
and neither can or should we, that the previous condition, which previously
allowed the use of the deposition, remains and would thereby justify the
use of the same deposition in another case or proceeding, even if the other
case or proceeding is before the same court. Since the basis for the
admission of the Bane deposition, in principle, being necessity, [131] the
burden of establishing its existence rests on the party who seeks the
admission of the evidence. This burden cannot be supplanted by
assuming the continuity of the previous condition or conditions in light of
the general rule against the non-presentation of the deponent in court. [132]
IV (d). The requirement of opportunity of the adverse party to
cross-examine; identity of parties; and identity of subject matter
The function of cross-examination is to test the truthfulness of the
statements of a witness made on direct examination. [133] The opportunity of
cross-examination has been regarded as an essential safeguard of the
accuracy and completeness of a testimony. In civil cases, the right of cross-
examination is absolute, and is not a mere privilege of the party against
whom a witness may be called. [134] This right is available, of course, at the
taking of depositions, as well as on the examination of witnesses at the
trial. The principal justification for the general exclusion of hearsay
statements and for the admission, as an exception to the hearsay rule, of
reported testimony taken at a former hearing where the present adversary
was afforded the opportunity to cross-examine, is based on the premise
that the opportunity of cross-examination is an essential
safeguard[135] against falsehoods and frauds.
In resolving the question of whether the requirement of opportunity to
cross-examine has been satisfied, we have to consider first the required
identity of parties as the present opponent to the admission of the Bane
deposition to whom the opportunity to cross-examine the deponent is
imputed may not after all be the same adverse party who actually had
such opportunity.
To render the testimony of a witness admissible at a later trial or action,
the parties to the first proceeding must be the same as the parties to the
later proceeding. Physical identity, however, is not required; substantial
identity[136] or identity of interests[137] suffices, as where the subsequent
proceeding is between persons who represent the parties to the prior
proceeding by privity in law, in blood, or in estate. The term privity denotes
mutual or successive relationships to the same rights of property. [138]
In the present case, the petitioner failed to impute, much less establish,
the identity of interest or privity between the then opponent, Africa, and
the present opponents, the respondents. While Africa is the son of the late
respondent Jose Africa, at most, the deposition should be admissible only
against him as an ETPI stockholder who filed the certiorari petition
docketed as Civil Case No. 0130 (and, unavoidably, as successor-in-interest
of the late respondent Jose Africa). While Africa and the respondents are all
ETPI stockholders, this commonality does not establish at all any privity
between them for purposes of binding the latter to the acts or omissions of
the former respecting the cross-examination of the deponent. The
sequestration of their shares does not result in the integration of their
rights and obligations as stockholders which remain distinct and personal
to them, vis-a-vis other stockholders.[139]
IV (d1). The respondents notice of taking of Bane deposition is
insufficient evidence of waiver
The petitioner staunchly asserts that the respondents have waived their
right to cross-examine the deponent for their failure to appear at the
deposition-taking despite individual notices previously sent to them. [140]
In its first Notice to Take Oral Deposition of Mr. Maurice V.
Bane dated August 30, 1996,[141] the petitioner originally intended to
depose Mr. Bane on September 25-26 1996. Because it failed to specify in
the notice the purpose for taking Mr. Banes deposition, the petitioner sent
a Second Amended Notice to Take Deposition of Mr. Maurice V. Bane Upon
Oral Examination where it likewise moved the scheduled deposition-taking
to October 23-26, 1996.
The records show that Africa moved several times for protective orders
against the intended deposition of Maurice Bane. [142] On the other hand,
among the respondents, only respondent Enrile appears to have filed an
Opposition[143] to the petitioners first notice, where he squarely raised the
issue of reasonability of the petitioners nineteen-day first notice. While the
Sandiganbayan denied Africas motion for protective orders, [144] it strikes us
that no ruling was ever handed down on respondent Enriles Opposition.[145]
It must be emphasized that even under Rule 23, the admission of the
deposition upon oral examination is not simply based on the fact of prior
notice on the individual sought to be bound thereby. In Northwest Airlines
v. Cruz, [146] we ruled that -
The provision explicitly vesting in the court the power to order that the
deposition shall not be taken connotes the authority to exercise discretion
on the matter. However, the discretion conferred by law is not unlimited. It
must be exercised, not arbitrarily or oppressively, but in a reasonable
manner and in consonance with the spirit of he law. The courts should
always see to it that the safeguards for the protection of the
parties and deponents are firmly maintained. As aptly stated by Chief
Justice Moran:
. . . . (T)his provision affords the adverse party, as well as the deponent,
sufficient protection against abuses that may be committed by a party in
the exercise of his unlimited right to discovery. As a writer said: "Any
discovery involves a prying into another person's affairs prying that is quite
justified if it is to be a legitimate aid to litigation, but not justified if it is not
to be such an aid." For this reason, courts are given ample powers to forbid
discovery which is intended not as an aid to litigation, but merely to annoy,
embarrass or oppress either the deponent or the adverse party, or
both. (emphasis ours)
In the present case, not only did the Sandiganbayan fail to rule on
respondent Enriles Opposition (which is equally applicable to his co-
respondents), it also failed to provide even the bare minimum safeguards
for the protection of, (more so) non-parties,[147] and to ensure that these
safeguards are firmly maintained. Instead, the Sandiganbayan simply
bought the petitioners assertion (that the taking of Bane deposition is a
matter of right) and treated the lingering concerns e.g., reasonability of the
notice; and the non-party status of the respondents in Civil Case No. 0130 -
at whose incident (docketed as G.R. No. 107789) the Bane deposition was
taken - rather perfunctorily to the prejudice of the respondents.
In conjunction with the order of consolidation, the petitioners reliance on
the prior notice on the respondents, as adequate opportunity for cross-
examination, cannot override the non-party status of the respondents in
Civil Case No. 0130 the effect of consolidation being merely for trial. As
non-parties, they cannot be bound by proceedings in that
case. Specifically, they cannot be bound by the taking of the Bane
deposition without the consequent impairment of their right of cross-
examination.[148] Opportunity for cross-examination, too, even assuming its
presence, cannot be singled out as basis for the admissibility of a former
testimony or deposition since such admissibility is also anchored on the
requisite identity of parties. To reiterate, although the Sandiganbayan
considered the Bane deposition in resolving Civil Case No. 0130, its action
was premised on Africas status as a party in that case where the Bane
deposition was taken.
Corollarily, the idea of privity also permeates Rule 23 of the Rules of Court
through its Section 5 which provides:
Effect of substitution of parties. Substitution of parties does not affect
the right to use depositions previously taken; and, when an action has
been dismissed and another action involving the same subject is afterward
brought between the same parties or their representatives or successors in
interest, all depositions lawfully taken and duly filed in the former action
may be used in the latter as if originally taken therefor. [italics and
underscoring ours]
In light of these considerations, we reject the petitioners claim that the
respondents waived their right to cross-examination when they failed to
attend the taking of the Bane deposition. Incidentally, the respondents
vigorous insistence on their right to cross-examine the deponent speaks
loudly that they never intended any waiver of this right.
Interestingly, the petitioners notice of the deposition-taking relied on Rule
23 of the Rules of Court. Section 15 of this rule reads:
Deposition upon oral examination; notice; time and place. A party
desiring to take the deposition of any person upon oral examination shall
give reasonable notice in writing to every other party to the action. The
notice shall state the time and place for taking the deposition and the
name and address of each person to be examined, if known, and if the
name is not known, a general description sufficient to identify him or the
particular class or group to which he belongs. On motion of any party upon
whom the notice is served, the court may for cause shown enlarge or
shorten the time.
Under this provision, we do not believe that the petitioner could reasonably
expect that the individual notices it sent to the respondents would be
sufficient to bind them to the conduct of the then opponents (Africas)
cross-examination since, to begin with, they were not even parties to the
action. Additionally, we observe that in the notice of the deposition taking,
conspicuously absent was any indication sufficient to forewarn the notified
persons that their inexcusable failure to appear at the deposition taking
would amount to a waiver of their right of cross-examination, without
prejudice to the right of the respondents to raise their objections at the
appropriate time.[149] We would be treading on dangerous grounds indeed
were we to hold that one not a party to an action, and neither in
privity nor in substantial identity of interest with any of the
parties in the same action, can be bound by the action or omission
of the latter, by the mere expedient of a notice. Thus, we cannot
simply deduce a resultant waiver from the respondents mere failure to
attend the deposition-taking despite notice sent by the petitioner.
Lastly, we see no reason why the Bane deposition could not have been
taken earlier in Civil Case No. 0009 the principal action where it was sought
to be introduced while Bane was still here in the Philippines. We note in this
regard that the Philippines was no longer under the Marcos administration
and had returned to normal democratic processes when Civil Case No.
0009 was filed. In fact, the petitioners notice itself states that the purpose
of the deposition is for Mr. Maurice Bane to identify and testify on the facts
set forth in his Affidavit, which Mr. Bane had long executed in 1991
in Makati, Metro Manila.[150] Clearly, a deposition could then have been
taken - without compromising the respondents right to cross-examine a
witness against them - considering that the principal purpose of the
deposition is chiefly a mode of discovery. These, to our mind, are avoidable
omissions that, when added to the deficient handling of the present
matter, add up to the gross deficiencies of the petitioner in the
handling of Civil Case No. 0009.
After failing to take Banes deposition in 1991 and in view of the peculiar
circumstances of this case, the least that the petitioner could have done
was to move for the taking of the Bane deposition and proceed with the
deposition immediately upon securing a favorable ruling thereon. On that
occasion, where the respondents would have a chance to be heard, the
respondents cannot avoid a resultant waiver of their right of cross-
examination if they still fail to appear at the deposition-
taking. Fundamental fairness dictates this course of action. It must
be stressed that not only were the respondents non-parties to Civil Case
No. 0130, they likewise have no interest in Africas certiorari petition
asserting his right as an ETPI stockholder.
Setting aside the petitioners flip-flopping on its own representations,
[151]
this Court can only express dismay on why the petitioner had to let
Bane leave the Philippines before taking his deposition despite having
knowledge already of the substance of what he would testify on.
Considering that the testimony of Bane is allegedly a vital cog in the
petitioners case against the respondents, the Court is left to wonder why
the petitioner had to take the deposition in an incident case (instead of the
main case) at a time when it became the technical right of the petitioner to
do so.
V. The petitioner cannot rely on principle of judicial notice
The petitioner also claims that since the Bane deposition had already been
previously introduced and admitted in Civil Case No. 0130, then the
Sandiganbayan should have taken judicial notice of the Bane deposition as
part of its evidence.
Judicial notice is the cognizance of certain facts that judges may properly
take and act on without proof because these facts are already known to
them.[152] Put differently, it is the assumption by a court of a fact without
need of further traditional evidentiary support. The principle is based on
convenience and expediency in securing and introducing evidence on
matters which are not ordinarily capable of dispute and are not bona
fide disputed.[153]
The foundation for judicial notice may be traced to the civil and canon law
maxim, manifesta (or notoria) non indigent probatione.[154] The taking of
judicial notice means that the court will dispense with the traditional form
of presentation of evidence. In so doing, the court assumes that the matter
is so notorious that it would not be disputed.
The concept of judicial notice is embodied in Rule 129 of the Revised Rules
on Evidence. Rule 129 either requires the court to take judicial notice, inter
alia, of the official acts of the x x x judicial departments of the Philippines,
[155]
or gives the court the discretion to take judicial notice of matters ought
to be known to judges because of their judicial functions. [156] On the other
hand, a party-litigant may ask the court to take judicial notice of any
matter and the court may allow the parties to be heard on the propriety of
taking judicial notice of the matter involved. [157] In the present case, after
the petitioner filed its Urgent Motion and/or Request for Judicial Notice, the
respondents were also heard through their corresponding oppositions.
In adjudicating a case on trial, generally, courts are not authorized to take
judicial notice of the contents of the records of other cases, even when
such cases have been tried or are pending in the same court, and
notwithstanding that both cases may have been tried or are actually
pending before the same judge.[158] This rule though admits of exceptions.
As a matter of convenience to all the parties, a court may properly treat all
or any part of the original record of a case filed in its archives as read into
the record of a case pending before it, when, with the knowledge
of, and absent an objection from, the adverse party, reference is
made to it for that purpose, by name and number or in some other
manner by which it is sufficiently designated; or when the original record of
the former case or any part of it, is actually withdrawn from the archives at
the court's direction, at the request or with the consent of the parties,
and admitted as a part of the record of the case then pending.[159]
Courts must also take judicial notice of the records of another case or
cases, where sufficient basis exists in the records of the case before it,
warranting the dismissal of the latter case.[160]
The issue before us does not involve the applicability of the rule on
mandatory taking of judicial notice; neither is the applicability of the rule
on discretionary taking of judicial notice seriously pursued. Rather, the
petitioner approaches the concept of judicial notice from a genealogical
perspective of treating whatever evidence offered in any of the children
cases Civil Case 0130 as evidence in the parent case Civil Case 0009 - or of
the whole family of cases.[161] To the petitioner, the supposed relationship of
these cases warrants the taking of judicial notice.
We strongly disagree. First, the supporting cases [162] the petitioner cited are
inapplicable either because these cases involve only a single proceeding or
an exception to the rule, which proscribes the courts from taking judicial
notice of the contents of the records of other cases. [163] Second, the
petitioners proposition is obviously obnoxious to a system of orderly
procedure. The petitioner itself admits that the present case has generated
a lot of cases, which, in all likelihood, involve issues of varying complexity.
If we follow the logic of the petitioners argument, we would be espousing
judicial confusion by indiscriminately allowing the admission of evidence in
one case, which was presumably found competent and relevant in another
case, simply based on the supposed lineage of the cases. It is the duty of
the petitioner, as a party-litigant, to properly lay before the court the
evidence it relies upon in support of the relief it seeks, instead of imposing
that same duty on the court. We invite the petitioners attention to our
prefatory pronouncement in Lopez v. Sandiganbayan:[164]
Down the oft-trodden path in our judicial system, by common sense,
tradition and the law, the Judge in trying a case sees only with judicial eyes
as he ought to know nothing about the facts of the case, except those
which have been adduced judicially in evidence. Thus, when the case is up
for trial, the judicial head is empty as to facts involved and it is incumbent
upon the litigants to the action to establish by evidence the facts upon
which they rely. (emphasis ours)
We therefore refuse, in the strongest terms, to entertain the petitioners
argument that we should take judicial notice of the Bane deposition.
VI. Summation
To recapitulate, we hold that: (1) the Sandiganbayans denial of the
petitioners 3rd motion the Motion to Admit Supplemental Offer of Evidence
(Re: Deposition of Maurice Bane) was a legal error that did not amount to
grave abuse of discretion; (2) the Sandiganbayans refusal to reopen the
case at the petitioners instance was tainted with grave abuse of discretion;
and (3) notwithstanding the grave abuse of discretion, the petition must
ultimately fail as the Bane deposition is not admissible under the rules of
evidence.[165]
VII. Refutation of Justice Carpios Last Minute Modified Dissent
At the last minute, Justice Carpio circulated a modified dissent, quoting the
Bane deposition. His covering note states:
I have revised my dissenting opinion to include the Bane deposition so that
the Court and the public will understand what the Bane deposition is all
about. (underlining added)
In light of this thrust, a discussion refuting the modified dissent is in order.
First: Contents of the Bane deposition not an Issue. The dissent
perfectly identified what is at issue in this case i.e., the admissibility of
the Bane deposition. Admissibility is concerned with the
competence and relevance[166] of the evidence, whose admission is sought.
While the dissent quoted at length the Bane deposition, it may not be
amiss to point out that the relevance of the Bane deposition(or, to
adopt the dissents characterization, whether Maurice V. Bane is a vital
witness) is not an issue here unless it can be established first that the
Bane deposition is a competent evidence.
Second: Misrepresentation of Cited Authority. The dissent insists that
in Philippine Jurisprudence, the consolidation of cases merges the different
actions into one and the rights of the parties are adjudicated in a single
judgment, citing Vicente J. Francisco. In our discussion on consolidation, we
footnoted the following in response to the dissents position, which we will
restate here for emphasis:
In the 1966 edition of Vicente J. Franciscos Revised Rules of Court,
Francisco wrote:
The effect of consolidation of actions is to unite and merge all of the
different actions consolidated into a single action, in the same manner as if
the different causes of actions involved had originally been joined in a
single action, and the order of consolidation, if made by a court of
competent jurisdiction, is binding upon all the parties to the different
actions until it is vacated or set aside. After the consolidation there can be
no further proceedings in the separate actions, which are by virtue of the
consolidation discontinued and superseded by a single action, which
should be entitled in such manner as the court may direct, and all
subsequent proceedings therein be conducted and the rights of the parties
adjudicated in a single action (1 C.J.S., 113, pp. 1371-1372).
At the very beginning of the discussion on consolidation of actions in
the Corpus Juris Secundum, the following caveat appears:
The term consolidation is used in three different senses. First, where
several actions are combined into one and lose their separate identity and
become a single action in which a single judgment is rendered; second,
where all except one of several actions are stayed until one is tried, in
which case the judgment in the one is conclusive as to the others; third,
where several actions are ordered to be tried together but each retains its
separate character and requires the entry of a separate judgment. The
failure to distinguish between these methods of procedure, which
are entirely distinct, the two latter, strictly speaking, not being
consolidation, a fact which has not always been noted, has caused
some confusion and conflict in the cases. (1 C.J.S., 107, pp. 1341-
1342) (Emphasis added).
In defining the term consolidation of actions, Francisco provided a
colatilla that the term consolidation is used in three different
senses, citing 1 C.J.S. 1341 and 1 Am. Jur. 477 (Francisco, Revised Rules of
Court, p. 348).
From the foregoing, it is clear that the dissent appears to have quoted
Franciscos statement out of context. As it is, the issue of the effect of
consolidation on evidence is at most an unsettled matter that requires the
approach we did in the majoritys discussion on consolidation. [167]
Third: Misappreciation of the Purpose of Consolidation. The dissent
then turns to the purpose of consolidation to expeditiously settle the
interwoven issues involved in the consolidated cases and the simplification
of the proceedings. It argues that this can only be achieved if the repetition
of the same evidence is dispensed with.
It is unfortunate that the dissent refuses to recognize the fact that since
consolidation is primarily addressed to the court concerned to aid it in
dispatching its official business, it would be in keeping with the orderly trial
procedure if the court should have a say on what consolidation would
actually bring[168] (especially where several cases are involved which have
become relatively complex). In the present case, there is nothing in the
proceedings below that would suggest that the Sandiganbayan or the
parties themselves (the petitioner and the respondents) had in mind a
consolidation beyond joint hearing or trial. Why should this Court which is
not a trial court impose a purported effect that has no factual or legal
grounds?
Fourth: The Due Process Consideration. The dissent argues that even
if the consolidation only resulted in a joint hearing or trial, the respondents
are still bound by the Bane deposition considering that they were given
notice of the deposition-taking. The issue here boils down to one of
due process the fundamental reason why a hearsay statement (not
subjected to the rigor of cross-examination) is generally excluded in the
realm of admissible evidence especially when read in light of the general
rule that depositions are not meant as substitute for the actual testimony,
in open court, of a party or witness.
Respondent Enrile had a pending Opposition to the notice of deposition-
taking (questioning the reasonableness thereof an issue applicable to the
rest of the respondents) which the Sandiganbayan failed to rule on. To
make the Sandiganbayans omission worse, the Sandiganbayan blindly
relied on the petitioners assertion that the deposition-taking was a matter
of right and, thus, failed to address the consequences and/or issues that
may arise from the apparently innocuous statement of the petitioner (that
it intends to use the Bane deposition in Civil Case No. 0009, where only the
respondents, and not Africa, are the parties). [169] There is simply the
absence of due in due process.
Fifth: Misstatement of the Sandiganbayans Action. The dissent
repeatedly misstates that the Sandiganbayan granted the request for the
deposition-taking. For emphasis, the Sandiganbayan did not grant the
request since the petitioner staunchly asserted that the deposition-taking
was a matter of right. No one can deny the complexity of the issues that
these consolidated cases have reached. Considering the consolidation of
cases of this nature, the most minimum of fairness demands upon
the petitioner to move for the taking of the Bane deposition and
for the Sandiganbayan to make a ruling thereon(including the
opposition filed by respondent Enrile which equally applies to his co-
respondents). The burgeoning omission and failures that have prevailed in
this case cannot be cured by this Court without itself being guilty of
violating the constitutional guarantee of due process.
Sixth: Issues Posed and Resolved Go Beyond Technicalities. The
above conclusions, contrary to the petitioners claim, are not only matters
of technicality. Admittedly, rules of procedure involve technicality, to which
we have applied the liberality that technical rules deserve. But the
resolution of the issues raised goes beyond pure or mere technicalities as
the preceding discussions show. They involve issues of due process and
basic unfairness to the respondents, particularly to respondent Enrile, who
is portrayed in the Bane deposition to be acting in behalf of the Marcoses
so that these shares should be deemed to be those of the Marcoses. They
involved, too, principles upon which our rules of procedure are founded
and which we cannot disregard without flirting with the violation of
guaranteed substantive rights and without risking the disorder that these
rules have sought to avert in the course of their evolution.
In the Court En Banc deliberations of December 6, 2011, the Court failed to
arrive at a conclusive decision because of a tie vote (7-7, with one Justice
taking no part). The same vote resulted in the re-voting of December 13,
2011. In this light, the ponencia is deemed sustained.
WHEREFORE, premises considered, we DISMISS the petition for lack
of merit. No costs.