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Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. L-63915 April 24, 1985

LORENZO M. TAÑADA, ABRAHAM F. SARMIENTO, and MOVEMENT OF ATTORNEYS


FOR BROTHERHOOD, INTEGRITY AND NATIONALISM, INC. [MABINI], petitioners,
vs.
HON. JUAN C. TUVERA, in his capacity as Executive Assistant to the President, HON. JOAQUIN
VENUS, in his capacity as Deputy Executive Assistant to the President , MELQUIADES P. DE LA
CRUZ, in his capacity as Director, Malacañang Records Office, and FLORENDO S. PABLO, in his
capacity as Director, Bureau of Printing, respondents.

ESCOLIN, J.:

Invoking the people's right to be informed on matters of public concern, a right recognized in Section 6,
Article IV of the 1973 Philippine Constitution, 1 as well as the principle that laws to be valid and
enforceable must be published in the Official Gazette or otherwise effectively promulgated, petitioners
seek a writ of mandamus to compel respondent public officials to publish, and/or cause the publication in
the Official Gazette of various presidential decrees, letters of instructions, general orders, proclamations,
executive orders, letter of implementation and administrative orders.

Specifically, the publication of the following presidential issuances is sought:

a] Presidential Decrees Nos. 12, 22, 37, 38, 59, 64, 103, 171, 179, 184, 197, 200, 234,
265, 286, 298, 303, 312, 324, 325, 326, 337, 355, 358, 359, 360, 361, 368, 404, 406, 415,
427, 429, 445, 447, 473, 486, 491, 503, 504, 521, 528, 551, 566, 573, 574, 594, 599, 644,
658, 661, 718, 731, 733, 793, 800, 802, 835, 836, 923, 935, 961, 1017-1030, 1050, 1060-
1061, 1085, 1143, 1165, 1166, 1242, 1246, 1250, 1278, 1279, 1300, 1644, 1772, 1808,
1810, 1813-1817, 1819-1826, 1829-1840, 1842-1847.

b] Letter of Instructions Nos.: 10, 39, 49, 72, 107, 108, 116, 130, 136, 141, 150, 153, 155,
161, 173, 180, 187, 188, 192, 193, 199, 202, 204, 205, 209, 211-213, 215-224, 226-228,
231-239, 241-245, 248, 251, 253-261, 263-269, 271-273, 275-283, 285-289, 291, 293,
297-299, 301-303, 309, 312-315, 325, 327, 343, 346, 349, 357, 358, 362, 367, 370, 382,
385, 386, 396-397, 405, 438-440, 444- 445, 473, 486, 488, 498, 501, 399, 527, 561, 576,
587, 594, 599, 600, 602, 609, 610, 611, 612, 615, 641, 642, 665, 702, 712-713, 726, 837-
839, 878-879, 881, 882, 939-940, 964,997,1149-1178,1180-1278.

c] General Orders Nos.: 14, 52, 58, 59, 60, 62, 63, 64 & 65.

d] Proclamation Nos.: 1126, 1144, 1147, 1151, 1196, 1270, 1281, 1319-1526, 1529,
1532, 1535, 1538, 1540-1547, 1550-1558, 1561-1588, 1590-1595, 1594-1600, 1606-
1609, 1612-1628, 1630-1649, 1694-1695, 1697-1701, 1705-1723, 1731-1734, 1737-
1742, 1744, 1746-1751, 1752, 1754, 1762, 1764-1787, 1789-1795, 1797, 1800, 1802-
1804, 1806-1807, 1812-1814, 1816, 1825-1826, 1829, 1831-1832, 1835-1836, 1839-
1840, 1843-1844, 1846-1847, 1849, 1853-1858, 1860, 1866, 1868, 1870, 1876-1889,
1892, 1900, 1918, 1923, 1933, 1952, 1963, 1965-1966, 1968-1984, 1986-2028, 2030-
2044, 2046-2145, 2147-2161, 2163-2244.

e] Executive Orders Nos.: 411, 413, 414, 427, 429-454, 457- 471, 474-492, 494-507,
509-510, 522, 524-528, 531-532, 536, 538, 543-544, 549, 551-553, 560, 563, 567-568,
570, 574, 593, 594, 598-604, 609, 611- 647, 649-677, 679-703, 705-707, 712-786, 788-
852, 854-857.
f] Letters of Implementation Nos.: 7, 8, 9, 10, 11-22, 25-27, 39, 50, 51, 59, 76, 80-81, 92,
94, 95, 107, 120, 122, 123.

g] Administrative Orders Nos.: 347, 348, 352-354, 360- 378, 380-433, 436-439.

The respondents, through the Solicitor General, would have this case dismissed outright on the ground
that petitioners have no legal personality or standing to bring the instant petition. The view is submitted
that in the absence of any showing that petitioners are personally and directly affected or prejudiced by
the alleged non-publication of the presidential issuances in question 2 said petitioners are without the
requisite legal personality to institute this mandamus proceeding, they are not being "aggrieved parties"
within the meaning of Section 3, Rule 65 of the Rules of Court, which we quote:

SEC. 3. Petition for Mandamus.—When any tribunal, corporation, board or person


unlawfully neglects the performance of an act which the law specifically enjoins as a duty
resulting from an office, trust, or station, or unlawfully excludes another from the use a rd
enjoyment of a right or office to which such other is entitled, and there is no other plain,
speedy and adequate remedy in the ordinary course of law, the person aggrieved thereby
may file a verified petition in the proper court alleging the facts with certainty and
praying that judgment be rendered commanding the defendant, immediately or at some
other specified time, to do the act required to be done to Protect the rights of the
petitioner, and to pay the damages sustained by the petitioner by reason of the wrongful
acts of the defendant.

Upon the other hand, petitioners maintain that since the subject of the petition concerns a public right and
its object is to compel the performance of a public duty, they need not show any specific interest for their
petition to be given due course.

The issue posed is not one of first impression. As early as the 1910 case of Severino vs. Governor
General, 3 this Court held that while the general rule is that "a writ of mandamus would be granted to a
private individual only in those cases where he has some private or particular interest to be subserved, or
some particular right to be protected, independent of that which he holds with the public at large," and "it
is for the public officers exclusively to apply for the writ when public rights are to be subserved
[Mithchell vs. Boardmen, 79 M.e., 469]," nevertheless, "when the question is one of public right and the
object of the mandamus is to procure the enforcement of a public duty, the people are regarded as the real
party in interest and the relator at whose instigation the proceedings are instituted need not show that he
has any legal or special interest in the result, it being sufficient to show that he is a citizen and as such
interested in the execution of the laws [High, Extraordinary Legal Remedies, 3rd ed., sec. 431].

Thus, in said case, this Court recognized the relator Lope Severino, a private individual, as a proper party
to the mandamus proceedings brought to compel the Governor General to call a special election for the
position of municipal president in the town of Silay, Negros Occidental. Speaking for this Court, Mr.
Justice Grant T. Trent said:

We are therefore of the opinion that the weight of authority supports the proposition that
the relator is a proper party to proceedings of this character when a public right is sought
to be enforced. If the general rule in America were otherwise, we think that it would not
be applicable to the case at bar for the reason 'that it is always dangerous to apply a
general rule to a particular case without keeping in mind the reason for the rule, because,
if under the particular circumstances the reason for the rule does not exist, the rule itself
is not applicable and reliance upon the rule may well lead to error'

No reason exists in the case at bar for applying the general rule insisted upon by counsel
for the respondent. The circumstances which surround this case are different from those
in the United States, inasmuch as if the relator is not a proper party to these proceedings
no other person could be, as we have seen that it is not the duty of the law officer of the
Government to appear and represent the people in cases of this character.

The reasons given by the Court in recognizing a private citizen's legal personality in the aforementioned
case apply squarely to the present petition. Clearly, the right sought to be enforced by petitioners herein is
a public right recognized by no less than the fundamental law of the land. If petitioners were not allowed
to institute this proceeding, it would indeed be difficult to conceive of any other person to initiate the
same, considering that the Solicitor General, the government officer generally empowered to represent the
people, has entered his appearance for respondents in this case.

Respondents further contend that publication in the Official Gazette is not a sine qua non requirement for
the effectivity of laws where the laws themselves provide for their own effectivity dates. It is thus
submitted that since the presidential issuances in question contain special provisions as to the date they
are to take effect, publication in the Official Gazette is not indispensable for their effectivity. The point
stressed is anchored on Article 2 of the Civil Code:

Art. 2. Laws shall take effect after fifteen days following the completion of their
publication in the Official Gazette, unless it is otherwise provided, ...

The interpretation given by respondent is in accord with this Court's construction of said article. In a long
line of decisions, 4 this Court has ruled that publication in the Official Gazette is necessary in those cases
where the legislation itself does not provide for its effectivity date-for then the date of publication is
material for determining its date of effectivity, which is the fifteenth day following its publication-but not
when the law itself provides for the date when it goes into effect.

Respondents' argument, however, is logically correct only insofar as it equates the effectivity of laws with
the fact of publication. Considered in the light of other statutes applicable to the issue at hand, the
conclusion is easily reached that said Article 2 does not preclude the requirement of publication in the
Official Gazette, even if the law itself provides for the date of its effectivity. Thus, Section 1 of
Commonwealth Act 638 provides as follows:

Section 1. There shall be published in the Official Gazette [1] all important legisiative
acts and resolutions of a public nature of the, Congress of the Philippines; [2] all
executive and administrative orders and proclamations, except such as have no general
applicability; [3] decisions or abstracts of decisions of the Supreme Court and the Court
of Appeals as may be deemed by said courts of sufficient importance to be so published;
[4] such documents or classes of documents as may be required so to be published by
law; and [5] such documents or classes of documents as the President of the Philippines
shall determine from time to time to have general applicability and legal effect, or which
he may authorize so to be published. ...

The clear object of the above-quoted provision is to give the general public adequate notice of the various
laws which are to regulate their actions and conduct as citizens. Without such notice and publication,
there would be no basis for the application of the maxim "ignorantia legis non excusat." It would be the
height of injustice to punish or otherwise burden a citizen for the transgression of a law of which he had
no notice whatsoever, not even a constructive one.

Perhaps at no time since the establishment of the Philippine Republic has the publication of laws taken so
vital significance that at this time when the people have bestowed upon the President a power heretofore
enjoyed solely by the legislature. While the people are kept abreast by the mass media of the debates and
deliberations in the Batasan Pambansa—and for the diligent ones, ready access to the legislative
records—no such publicity accompanies the law-making process of the President. Thus, without
publication, the people have no means of knowing what presidential decrees have actually been
promulgated, much less a definite way of informing themselves of the specific contents and texts of such
decrees. As the Supreme Court of Spain ruled: "Bajo la denominacion generica de leyes, se comprenden
tambien los reglamentos, Reales decretos, Instrucciones, Circulares y Reales ordines dictadas de
conformidad con las mismas por el Gobierno en uso de su potestad. 5

The very first clause of Section I of Commonwealth Act 638 reads: "There shall be published in the
Official Gazette ... ." The word "shall" used therein imposes upon respondent officials an imperative duty.
That duty must be enforced if the Constitutional right of the people to be informed on matters of public
concern is to be given substance and reality. The law itself makes a list of what should be published in the
Official Gazette. Such listing, to our mind, leaves respondents with no discretion whatsoever as to what
must be included or excluded from such publication.

The publication of all presidential issuances "of a public nature" or "of general applicability" is mandated
by law. Obviously, presidential decrees that provide for fines, forfeitures or penalties for their violation or
otherwise impose a burden or. the people, such as tax and revenue measures, fall within this category.
Other presidential issuances which apply only to particular persons or class of persons such as
administrative and executive orders need not be published on the assumption that they have been
circularized to all concerned. 6

It is needless to add that the publication of presidential issuances "of a public nature" or "of general
applicability" is a requirement of due process. It is a rule of law that before a person may be bound by
law, he must first be officially and specifically informed of its contents. As Justice Claudio Teehankee
said in Peralta vs. COMELEC 7:

In a time of proliferating decrees, orders and letters of instructions which all form part of
the law of the land, the requirement of due process and the Rule of Law demand that the
Official Gazette as the official government repository promulgate and publish the texts of
all such decrees, orders and instructions so that the people may know where to obtain
their official and specific contents.

The Court therefore declares that presidential issuances of general application, which have not been
published, shall have no force and effect. Some members of the Court, quite apprehensive about the
possible unsettling effect this decision might have on acts done in reliance of the validity of those
presidential decrees which were published only during the pendency of this petition, have put the question
as to whether the Court's declaration of invalidity apply to P.D.s which had been enforced or implemented
prior to their publication. The answer is all too familiar. In similar situations in the past this Court had
taken the pragmatic and realistic course set forth in Chicot County Drainage District vs. Baxter Bank 8 to
wit:

The courts below have proceeded on the theory that the Act of Congress, having been
found to be unconstitutional, was not a law; that it was inoperative, conferring no rights
and imposing no duties, and hence affording no basis for the challenged decree. Norton v.
Shelby County, 118 U.S. 425, 442; Chicago, 1. & L. Ry. Co. v. Hackett, 228 U.S. 559,
566. It is quite clear, however, that such broad statements as to the effect of a
determination of unconstitutionality must be taken with qualifications. The actual
existence of a statute, prior to such a determination, is an operative fact and may have
consequences which cannot justly be ignored. The past cannot always be erased by a new
judicial declaration. The effect of the subsequent ruling as to invalidity may have to be
considered in various aspects-with respect to particular conduct, private and official.
Questions of rights claimed to have become vested, of status, of prior determinations
deemed to have finality and acted upon accordingly, of public policy in the light of the
nature both of the statute and of its previous application, demand examination. These
questions are among the most difficult of those which have engaged the attention of
courts, state and federal and it is manifest from numerous decisions that an all-inclusive
statement of a principle of absolute retroactive invalidity cannot be justified.

Consistently with the above principle, this Court in Rutter vs. Esteban 9 sustained the right of a party
under the Moratorium Law, albeit said right had accrued in his favor before said law was declared
unconstitutional by this Court.

Similarly, the implementation/enforcement of presidential decrees prior to their publication in the Official
Gazette is "an operative fact which may have consequences which cannot be justly ignored. The past
cannot always be erased by a new judicial declaration ... that an all-inclusive statement of a principle of
absolute retroactive invalidity cannot be justified."

From the report submitted to the Court by the Clerk of Court, it appears that of the presidential decrees
sought by petitioners to be published in the Official Gazette, only Presidential Decrees Nos. 1019 to 1030,
inclusive, 1278, and 1937 to 1939, inclusive, have not been so published. 10 Neither the subject matters
nor the texts of these PDs can be ascertained since no copies thereof are available. But whatever their
subject matter may be, it is undisputed that none of these unpublished PDs has ever been implemented or
enforced by the government. In Pesigan vs. Angeles, 11 the Court, through Justice Ramon Aquino, ruled
that "publication is necessary to apprise the public of the contents of [penal] regulations and make the said
penalties binding on the persons affected thereby. " The cogency of this holding is apparently recognized
by respondent officials considering the manifestation in their comment that "the government, as a matter
of policy, refrains from prosecuting violations of criminal laws until the same shall have been published
in the Official Gazette or in some other publication, even though some criminal laws provide that they
shall take effect immediately.

WHEREFORE, the Court hereby orders respondents to publish in the Official Gazette all unpublished
presidential issuances which are of general application, and unless so published, they shall have no
binding force and effect.

SO ORDERED.

Relova, J., concurs.

Aquino, J., took no part.

Concepcion, Jr., J., is on leave.

Separate Opinions

FERNANDO, C.J., concurring (with qualification):

There is on the whole acceptance on my part of the views expressed in the ably written opinion of Justice
Escolin. I am unable, however, to concur insofar as it would unqualifiedly impose the requirement of
publication in the Official Gazette for unpublished "presidential issuances" to have binding force and
effect.

I shall explain why.

1. It is of course true that without the requisite publication, a due process question would arise if made to
apply adversely to a party who is not even aware of the existence of any legislative or executive act
having the force and effect of law. My point is that such publication required need not be confined to the
Official Gazette. From the pragmatic standpoint, there is an advantage to be gained. It conduces to
certainty. That is too be admitted. It does not follow, however, that failure to do so would in all cases and
under all circumstances result in a statute, presidential decree or any other executive act of the same
category being bereft of any binding force and effect. To so hold would, for me, raise a constitutional
question. Such a pronouncement would lend itself to the interpretation that such a legislative or
presidential act is bereft of the attribute of effectivity unless published in the Official Gazette. There is no
such requirement in the Constitution as Justice Plana so aptly pointed out. It is true that what is decided
now applies only to past "presidential issuances". Nonetheless, this clarification is, to my mind, needed to
avoid any possible misconception as to what is required for any statute or presidential act to be impressed
with binding force or effectivity.

2. It is quite understandable then why I concur in the separate opinion of Justice Plana. Its first paragraph
sets forth what to me is the constitutional doctrine applicable to this case. Thus: "The Philippine
Constitution does not require the publication of laws as a prerequisite for their effectivity, unlike some
Constitutions elsewhere. It may be said though that the guarantee of due process requires notice of laws to
affected Parties before they can be bound thereby; but such notice is not necessarily by publication in the
Official Gazette. The due process clause is not that precise. 1 I am likewise in agreement with its closing
paragraph: "In fine, I concur in the majority decision to the extent that it requires notice before laws
become effective, for no person should be bound by a law without notice. This is elementary fairness.
However, I beg to disagree insofar as it holds that such notice shall be by publication in the Official
Gazette. 2

3. It suffices, as was stated by Judge Learned Hand, that law as the command of the government "must be
ascertainable in some form if it is to be enforced at all. 3 It would indeed be to reduce it to the level of
mere futility, as pointed out by Justice Cardozo, "if it is unknown and unknowable. 4 Publication, to
repeat, is thus essential. What I am not prepared to subscribe to is the doctrine that it must be in the
Official Gazette. To be sure once published therein there is the ascertainable mode of determining the
exact date of its effectivity. Still for me that does not dispose of the question of what is the jural effect of
past presidential decrees or executive acts not so published. For prior thereto, it could be that parties
aware of their existence could have conducted themselves in accordance with their provisions. If no legal
consequences could attach due to lack of publication in the Official Gazette, then serious problems could
arise. Previous transactions based on such "Presidential Issuances" could be open to question. Matters
deemed settled could still be inquired into. I am not prepared to hold that such an effect is contemplated
by our decision. Where such presidential decree or executive act is made the basis of a criminal
prosecution, then, of course, its ex post facto character becomes evident. 5 In civil cases though,
retroactivity as such is not conclusive on the due process aspect. There must still be a showing of
arbitrariness. Moreover, where the challenged presidential decree or executive act was issued under the
police power, the non-impairment clause of the Constitution may not always be successfully invoked.
There must still be that process of balancing to determine whether or not it could in such a case be tainted
by infirmity. 6 In traditional terminology, there could arise then a question of unconstitutional application.
That is as far as it goes.

4. Let me make therefore that my qualified concurrence goes no further than to affirm that publication is
essential to the effectivity of a legislative or executive act of a general application. I am not in agreement
with the view that such publication must be in the Official Gazette. The Civil Code itself in its Article 2
expressly recognizes that the rule as to laws taking effect after fifteen days following the completion of
their publication in the Official Gazette is subject to this exception, "unless it is otherwise provided."
Moreover, the Civil Code is itself only a legislative enactment, Republic Act No. 386. It does not and
cannot have the juridical force of a constitutional command. A later legislative or executive act which has
the force and effect of law can legally provide for a different rule.

5. Nor can I agree with the rather sweeping conclusion in the opinion of Justice Escolin that presidential
decrees and executive acts not thus previously published in the Official Gazette would be devoid of any
legal character. That would be, in my opinion, to go too far. It may be fraught, as earlier noted, with
undesirable consequences. I find myself therefore unable to yield assent to such a pronouncement.

I am authorized to state that Justices Makasiar, Abad Santos, Cuevas, and Alampay concur in this
separate opinion.

Makasiar, Abad Santos, Cuevas and Alampay, JJ., concur.

TEEHANKEE, J., concurring:

I concur with the main opinion of Mr. Justice Escolin and the concurring opinion of Mme. Justice
Herrera. The Rule of Law connotes a body of norms and laws published and ascertainable and of equal
application to all similarly circumstances and not subject to arbitrary change but only under certain set
procedures. The Court has consistently stressed that "it is an elementary rule of fair play and justice that a
reasonable opportunity to be informed must be afforded to the people who are commanded to obey before
they can be punished for its violation, 1 citing the settled principle based on due process enunciated in
earlier cases that "before the public is bound by its contents, especially its penal provisions, a law,
regulation or circular must first be published and the people officially and specially informed of said
contents and its penalties.

Without official publication in the Official Gazette as required by Article 2 of the Civil Code and the
Revised Administrative Code, there would be no basis nor justification for the corollary rule of Article 3
of the Civil Code (based on constructive notice that the provisions of the law are ascertainable from the
public and official repository where they are duly published) that "Ignorance of the law excuses no one
from compliance therewith.

Respondents' contention based on a misreading of Article 2 of the Civil Code that "only laws which are
silent as to their effectivity [date] need be published in the Official Gazette for their effectivity" is
manifestly untenable. The plain text and meaning of the Civil Code is that "laws shall take effect after
fifteen days following the completion of their publication in the Official Gazette, unless it is otherwise
provided, " i.e. a different effectivity date is provided by the law itself. This proviso perforce refers to a
law that has been duly published pursuant to the basic constitutional requirements of due process. The
best example of this is the Civil Code itself: the same Article 2 provides otherwise that it "shall take effect
[only] one year [not 15 days] after such publication. 2 To sustain respondents' misreading that "most laws
or decrees specify the date of their effectivity and for this reason, publication in the Official Gazette is not
necessary for their effectivity 3 would be to nullify and render nugatory the Civil Code's indispensable and
essential requirement of prior publication in the Official Gazette by the simple expedient of providing for
immediate effectivity or an earlier effectivity date in the law itself before the completion of 15 days
following its publication which is the period generally fixed by the Civil Code for its proper
dissemination.

MELENCIO-HERRERA, J., concurring:

I agree. There cannot be any question but that even if a decree provides for a date of effectivity, it has to
be published. What I would like to state in connection with that proposition is that when a date of
effectivity is mentioned in the decree but the decree becomes effective only fifteen (15) days after its
publication in the Official Gazette, it will not mean that the decree can have retroactive effect to the date
of effectivity mentioned in the decree itself. There should be no retroactivity if the retroactivity will run
counter to constitutional rights or shall destroy vested rights.

PLANA, J., concurring (with qualification):

The Philippine Constitution does not require the publication of laws as a prerequisite for their effectivity,
unlike some Constitutions elsewhere. * It may be said though that the guarantee of due process requires
notice of laws to affected parties before they can be bound thereby; but such notice is not necessarily by
publication in the Official Gazette. The due process clause is not that precise. Neither is the publication of
laws in the Official Gazette required by any statute as a prerequisite for their effectivity, if said laws
already provide for their effectivity date.

Article 2 of the Civil Code provides that "laws shall take effect after fifteen days following the
completion of their publication in the Official Gazette, unless it is otherwise provided " Two things may
be said of this provision: Firstly, it obviously does not apply to a law with a built-in provision as to when
it will take effect. Secondly, it clearly recognizes that each law may provide not only a different period for
reckoning its effectivity date but also a different mode of notice. Thus, a law may prescribe that it shall be
published elsewhere than in the Official Gazette.

Commonwealth Act No. 638, in my opinion, does not support the proposition that for their
effectivity, laws must be published in the Official Gazette. The said law is simply "An Act to Provide for
the Uniform Publication and Distribution of the Official Gazette." Conformably therewith, it authorizes
the publication of the Official Gazette, determines its frequency, provides for its sale and distribution, and
defines the authority of the Director of Printing in relation thereto. It also enumerates what shall be
published in the Official Gazette, among them, "important legislative acts and resolutions of a public
nature of the Congress of the Philippines" and "all executive and administrative orders and proclamations,
except such as have no general applicability." It is noteworthy that not all legislative acts are required to
be published in the Official Gazette but only "important" ones "of a public nature." Moreover, the said
law does not provide that publication in the Official Gazette is essential for the effectivity of laws. This is
as it should be, for all statutes are equal and stand on the same footing. A law, especially an earlier one of
general application such as Commonwealth Act No. 638, cannot nullify or restrict the operation of a
subsequent statute that has a provision of its own as to when and how it will take effect. Only a higher
law, which is the Constitution, can assume that role.

In fine, I concur in the majority decision to the extent that it requires notice before laws become effective,
for no person should be bound by a law without notice. This is elementary fairness. However, I beg to
disagree insofar as it holds that such notice shall be by publication in the Official Gazette.

Cuevas and Alampay, JJ., concur.


GUTIERREZ, Jr., J., concurring:

I concur insofar as publication is necessary but reserve my vote as to the necessity of such publication
being in the Official Gazette.

DE LA FUENTE, J., concurring:

I concur insofar as the opinion declares the unpublished decrees and issuances of a public nature or
general applicability ineffective, until due publication thereof.

Separate Opinions

FERNANDO, C.J., concurring (with qualification):

There is on the whole acceptance on my part of the views expressed in the ably written opinion of Justice
Escolin. I am unable, however, to concur insofar as it would unqualifiedly impose the requirement of
publication in the Official Gazette for unpublished "presidential issuances" to have binding force and
effect.

I shall explain why.

1. It is of course true that without the requisite publication, a due process question would arise if made to
apply adversely to a party who is not even aware of the existence of any legislative or executive act
having the force and effect of law. My point is that such publication required need not be confined to the
Official Gazette. From the pragmatic standpoint, there is an advantage to be gained. It conduces to
certainty. That is too be admitted. It does not follow, however, that failure to do so would in all cases and
under all circumstances result in a statute, presidential decree or any other executive act of the same
category being bereft of any binding force and effect. To so hold would, for me, raise a constitutional
question. Such a pronouncement would lend itself to the interpretation that such a legislative or
presidential act is bereft of the attribute of effectivity unless published in the Official Gazette. There is no
such requirement in the Constitution as Justice Plana so aptly pointed out. It is true that what is decided
now applies only to past "presidential issuances". Nonetheless, this clarification is, to my mind, needed to
avoid any possible misconception as to what is required for any statute or presidential act to be impressed
with binding force or effectivity.

2. It is quite understandable then why I concur in the separate opinion of Justice Plana. Its first paragraph
sets forth what to me is the constitutional doctrine applicable to this case. Thus: "The Philippine
Constitution does not require the publication of laws as a prerequisite for their effectivity, unlike some
Constitutions elsewhere. It may be said though that the guarantee of due process requires notice of laws to
affected Parties before they can be bound thereby; but such notice is not necessarily by publication in the
Official Gazette. The due process clause is not that precise. 1 I am likewise in agreement with its closing
paragraph: "In fine, I concur in the majority decision to the extent that it requires notice before laws
become effective, for no person should be bound by a law without notice. This is elementary fairness.
However, I beg to disagree insofar as it holds that such notice shall be by publication in the Official
Gazette. 2

3. It suffices, as was stated by Judge Learned Hand, that law as the command of the government "must be
ascertainable in some form if it is to be enforced at all. 3 It would indeed be to reduce it to the level of
mere futility, as pointed out by Justice Cardozo, "if it is unknown and unknowable. 4 Publication, to
repeat, is thus essential. What I am not prepared to subscribe to is the doctrine that it must be in the
Official Gazette. To be sure once published therein there is the ascertainable mode of determining the
exact date of its effectivity. Still for me that does not dispose of the question of what is the jural effect of
past presidential decrees or executive acts not so published. For prior thereto, it could be that parties
aware of their existence could have conducted themselves in accordance with their provisions. If no legal
consequences could attach due to lack of publication in the Official Gazette, then serious problems could
arise. Previous transactions based on such "Presidential Issuances" could be open to question. Matters
deemed settled could still be inquired into. I am not prepared to hold that such an effect is contemplated
by our decision. Where such presidential decree or executive act is made the basis of a criminal
prosecution, then, of course, its ex post facto character becomes evident. 5 In civil cases though,
retroactivity as such is not conclusive on the due process aspect. There must still be a showing of
arbitrariness. Moreover, where the challenged presidential decree or executive act was issued under the
police power, the non-impairment clause of the Constitution may not always be successfully invoked.
There must still be that process of balancing to determine whether or not it could in such a case be tainted
by infirmity. 6 In traditional terminology, there could arise then a question of unconstitutional application.
That is as far as it goes.

4. Let me make therefore that my qualified concurrence goes no further than to affirm that publication is
essential to the effectivity of a legislative or executive act of a general application. I am not in agreement
with the view that such publication must be in the Official Gazette. The Civil Code itself in its Article 2
expressly recognizes that the rule as to laws taking effect after fifteen days following the completion of
their publication in the Official Gazette is subject to this exception, "unless it is otherwise provided."
Moreover, the Civil Code is itself only a legislative enactment, Republic Act No. 386. It does not and
cannot have the juridical force of a constitutional command. A later legislative or executive act which has
the force and effect of law can legally provide for a different rule.

5. Nor can I agree with the rather sweeping conclusion in the opinion of Justice Escolin that presidential
decrees and executive acts not thus previously published in the Official Gazette would be devoid of any
legal character. That would be, in my opinion, to go too far. It may be fraught, as earlier noted, with
undesirable consequences. I find myself therefore unable to yield assent to such a pronouncement.

I am authorized to state that Justices Makasiar, Abad Santos, Cuevas, and Alampay concur in this
separate opinion.

Makasiar, Abad Santos, Cuevas and Alampay, JJ., concur.

TEEHANKEE, J., concurring:

I concur with the main opinion of Mr. Justice Escolin and the concurring opinion of Mme. Justice
Herrera. The Rule of Law connotes a body of norms and laws published and ascertainable and of equal
application to all similarly circumstances and not subject to arbitrary change but only under certain set
procedures. The Court has consistently stressed that "it is an elementary rule of fair play and justice that a
reasonable opportunity to be informed must be afforded to the people who are commanded to obey before
they can be punished for its violation, 1 citing the settled principle based on due process enunciated in
earlier cases that "before the public is bound by its contents, especially its penal provisions, a law,
regulation or circular must first be published and the people officially and specially informed of said
contents and its penalties.

Without official publication in the Official Gazette as required by Article 2 of the Civil Code and the
Revised Administrative Code, there would be no basis nor justification for the corollary rule of Article 3
of the Civil Code (based on constructive notice that the provisions of the law are ascertainable from the
public and official repository where they are duly published) that "Ignorance of the law excuses no one
from compliance therewith.

Respondents' contention based on a misreading of Article 2 of the Civil Code that "only laws which are
silent as to their effectivity [date] need be published in the Official Gazette for their effectivity" is
manifestly untenable. The plain text and meaning of the Civil Code is that "laws shall take effect after
fifteen days following the completion of their publication in the Official Gazette, unless it is otherwise
provided, " i.e. a different effectivity date is provided by the law itself. This proviso perforce refers to a
law that has been duly published pursuant to the basic constitutional requirements of due process. The
best example of this is the Civil Code itself: the same Article 2 provides otherwise that it "shall take effect
[only] one year [not 15 days] after such publication. 2 To sustain respondents' misreading that "most laws
or decrees specify the date of their effectivity and for this reason, publication in the Official Gazette is not
necessary for their effectivity 3 would be to nullify and render nugatory the Civil Code's indispensable and
essential requirement of prior publication in the Official Gazette by the simple expedient of providing for
immediate effectivity or an earlier effectivity date in the law itself before the completion of 15 days
following its publication which is the period generally fixed by the Civil Code for its proper
dissemination.

MELENCIO-HERRERA, J., concurring:

I agree. There cannot be any question but that even if a decree provides for a date of effectivity, it has to
be published. What I would like to state in connection with that proposition is that when a date of
effectivity is mentioned in the decree but the decree becomes effective only fifteen (15) days after its
publication in the Official Gazette, it will not mean that the decree can have retroactive effect to the date
of effectivity mentioned in the decree itself. There should be no retroactivity if the retroactivity will run
counter to constitutional rights or shall destroy vested rights.

PLANA, J., concurring (with qualification):

The Philippine Constitution does not require the publication of laws as a prerequisite for their effectivity,
unlike some Constitutions elsewhere. * It may be said though that the guarantee of due process requires
notice of laws to affected parties before they can be bound thereby; but such notice is not necessarily by
publication in the Official Gazette. The due process clause is not that precise. Neither is the publication of
laws in the Official Gazette required by any statute as a prerequisite for their effectivity, if said laws
already provide for their effectivity date.

Article 2 of the Civil Code provides that "laws shall take effect after fifteen days following the
completion of their publication in the Official Gazette, unless it is otherwise provided " Two things may
be said of this provision: Firstly, it obviously does not apply to a law with a built-in provision as to when
it will take effect. Secondly, it clearly recognizes that each law may provide not only a different period for
reckoning its effectivity date but also a different mode of notice. Thus, a law may prescribe that it shall be
published elsewhere than in the Official Gazette.

Commonwealth Act No. 638, in my opinion, does not support the proposition that for their
effectivity, laws must be published in the Official Gazette. The said law is simply "An Act to Provide for
the Uniform Publication and Distribution of the Official Gazette." Conformably therewith, it authorizes
the publication of the Official Gazette, determines its frequency, provides for its sale and distribution, and
defines the authority of the Director of Printing in relation thereto. It also enumerates what shall be
published in the Official Gazette, among them, "important legislative acts and resolutions of a public
nature of the Congress of the Philippines" and "all executive and administrative orders and proclamations,
except such as have no general applicability." It is noteworthy that not all legislative acts are required to
be published in the Official Gazette but only "important" ones "of a public nature." Moreover, the said
law does not provide that publication in the Official Gazette is essential for the effectivity of laws. This is
as it should be, for all statutes are equal and stand on the same footing. A law, especially an earlier one of
general application such as Commonwealth Act No. 638, cannot nullify or restrict the operation of a
subsequent statute that has a provision of its own as to when and how it will take effect. Only a higher
law, which is the Constitution, can assume that role.

In fine, I concur in the majority decision to the extent that it requires notice before laws become effective,
for no person should be bound by a law without notice. This is elementary fairness. However, I beg to
disagree insofar as it holds that such notice shall be by publication in the Official Gazette.

Cuevas and Alampay, JJ., concur.

GUTIERREZ, Jr., J., concurring:


I concur insofar as publication is necessary but reserve my vote as to the necessity of such publication
being in the Official Gazette.

DE LA FUENTE, J., concurring:

I concur insofar as the opinion declares the unpublished decrees and issuances of a public nature or
general applicability ineffective, until due publication thereof.
Republic of the Philippines
SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 80718 January 29, 1988

FELIZA P. DE ROY and VIRGILIO RAMOS, petitioners,


vs.
COURT OF APPEALS and LUIS BERNAL, SR., GLENIA BERNAL, LUIS BERNAL, JR.,
HEIRS OF MARISSA BERNAL, namely, GLICERIA DELA CRUZ BERNAL and LUIS
BERNAL, SR., respondents.

RESOLUTION

CORTES, J.:

This special civil action for certiorari seeks to declare null and void two (2) resolutions of the Special
First Division of the Court of Appeals in the case of Luis Bernal, Sr., et al. v. Felisa Perdosa De Roy, et
al., CA-G.R. CV No. 07286. The first resolution promulgated on 30 September 1987 denied petitioners'
motion for extension of time to file a motion for reconsideration and directed entry of judgment since the
decision in said case had become final; and the second Resolution dated 27 October 1987 denied
petitioners' motion for reconsideration for having been filed out of time.

At the outset, this Court could have denied the petition outright for not being verified as required by Rule
65 section 1 of the Rules of Court. However, even if the instant petition did not suffer from this defect,
this Court, on procedural and substantive grounds, would still resolve to deny it.

The facts of the case are undisputed. The firewall of a burned-out building owned by petitioners collapsed
and destroyed the tailoring shop occupied by the family of private respondents, resulting in injuries to
private respondents and the death of Marissa Bernal, a daughter. Private respondents had been warned by
petitioners to vacate their shop in view of its proximity to the weakened wall but the former failed to do
so. On the basis of the foregoing facts, the Regional Trial Court. First Judicial Region, Branch XXXVIII,
presided by the Hon. Antonio M. Belen, rendered judgment finding petitioners guilty of gross negligence
and awarding damages to private respondents. On appeal, the decision of the trial court was affirmed in
toto by the Court of Appeals in a decision promulgated on August 17, 1987, a copy of which was received
by petitioners on August 25, 1987. On September 9, 1987, the last day of the fifteen-day period to file an
appeal, petitioners filed a motion for extension of time to file a motion for reconsideration, which was
eventually denied by the appellate court in the Resolution of September 30, 1987. Petitioners filed their
motion for reconsideration on September 24, 1987 but this was denied in the Resolution of October 27,
1987.

This Court finds that the Court of Appeals did not commit a grave abuse of discretion when it denied
petitioners' motion for extension of time to file a motion for reconsideration, directed entry of judgment
and denied their motion for reconsideration. It correctly applied the rule laid down in Habaluyas
Enterprises, Inc. v. Japzon, [G.R. No. 70895, August 5, 1985,138 SCRA 461, that the fifteen-day period
for appealing or for filing a motion for reconsideration cannot be extended. In its Resolution denying the
motion for reconsideration, promulgated on July 30, 1986 (142 SCRA 208), this Court en banc restated
and clarified the rule, to wit:

Beginning one month after the promulgation of this Resolution, the rule shall be strictly enforced that no
motion for extension of time to file a motion for reconsideration may be filed with the Metropolitan or
Municipal Trial Courts, the Regional Trial Courts, and the Intermediate Appellate Court. Such a motion
may be filed only in cases pending with the Supreme Court as the court of last resort, which may in its
sound discretion either grant or deny the extension requested. (at p. 212)
Lacsamana v. Second Special Cases Division of the intermediate Appellate Court, [G.R. No. 73146-53,
August 26, 1986, 143 SCRA 643], reiterated the rule and went further to restate and clarify the modes and
periods of appeal.

Bacaya v. Intermediate Appellate Court, [G.R. No. 74824, Sept. 15, 1986,144 SCRA 161],stressed the
prospective application of said rule, and explained the operation of the grace period, to wit:

In other words, there is a one-month grace period from the promulgation on May 30,
1986 of the Court's Resolution in the clarificatory Habaluyas case, or up to June 30,
1986, within which the rule barring extensions of time to file motions for new trial or
reconsideration is, as yet, not strictly enforceable.

Since petitioners herein filed their motion for extension on February 27, 1986, it is still
within the grace period, which expired on June 30, 1986, and may still be allowed.

This grace period was also applied in Mission v. Intermediate Appellate Court [G.R. No. 73669, October
28, 1986, 145 SCRA 306].]

In the instant case, however, petitioners' motion for extension of time was filed on September 9, 1987,
more than a year after the expiration of the grace period on June 30, 1986. Hence, it is no longer within
the coverage of the grace period. Considering the length of time from the expiration of the grace period to
the promulgation of the decision of the Court of Appeals on August 25, 1987, petitioners cannot seek
refuge in the ignorance of their counsel regarding said rule for their failure to file a motion for
reconsideration within the reglementary period.

Petitioners contend that the rule enunciated in the Habaluyas case should not be made to apply to the case
at bar owing to the non-publication of the Habaluyas decision in the Official Gazette as of the time the
subject decision of the Court of Appeals was promulgated. Contrary to petitioners' view, there is no law
requiring the publication of Supreme Court decisions in the Official Gazette before they can be binding
and as a condition to their becoming effective. It is the bounden duty of counsel as lawyer in active law
practice to keep abreast of decisions of the Supreme Court particularly where issues have been clarified,
consistently reiterated, and published in the advance reports of Supreme Court decisions (G. R. s) and in
such publications as the Supreme Court Reports Annotated (SCRA) and law journals.

This Court likewise finds that the Court of Appeals committed no grave abuse of discretion in affirming
the trial court's decision holding petitioner liable under Article 2190 of the Civil Code, which provides
that "the proprietor of a building or structure is responsible for the damage resulting from its total or
partial collapse, if it should be due to the lack of necessary repairs.

Nor was there error in rejecting petitioners argument that private respondents had the "last clear chance"
to avoid the accident if only they heeded the. warning to vacate the tailoring shop and , therefore,
petitioners prior negligence should be disregarded, since the doctrine of "last clear chance," which has
been applied to vehicular accidents, is inapplicable to this case.

WHEREFORE, in view of the foregoing, the Court Resolved to DENY the instant petition for lack of
merit.
Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 70895 May 30, 1986

HABALUYAS ENTERPRISES, INC. and PEDRO HABALUYAS, petitioners,


vs.
JUDGE MAXIMO M. JAPSON, Manila Regional Trial Court, Branch 36; SHUGO NODA & CO.,
LTD., and SHUYA NODA, respondents.

Norberto J. Quisumbing for respondents.

RESOLUTION

FERIA, J.:

Respondents have filed a motion for reconsideration of the Decision of the Second Division of the Court
promulgated on August 5, 1985 which granted the petition for certiorari and prohibition and set aside the
order of respondent Judge granting private respondents' motion for new trial.

The issue in this case is whether the fifteen-day period within which a party may file a motion for
reconsideration of a final order or ruling of the Regional Trial Court may be extended.

Section 39 of The Judiciary Reorganization Act, Batas Pambansa Blg. 129, reduced the period for appeal
from final orders or judgments of the Regional Trial Courts (formerly Courts of First Instance) from thirty
(30) to fifteen (15) days and provides a uniform period of fifteen days for appeal from final orders,
resolutions, awards, judgments, or decisions of any court counted from notice thereof, except in habeas
corpus cases where the period for appeal remains at forty- eight (48) hours. To expedite appeals, only a
notice of appeal is required and a record on appeal is no longer required except in appeals in special
proceedings under Rule 109 of the Rules of Court and in other cases wherein multiple appeals are
allowed. Section 19 of the Interim Rules provides that in these exceptional cases, the period for appeal is
thirty (30) days since a record on appeal is required. Moreover Section 18 of the Interim Rules provides
that no appeal bond shall be required for an appeal, and Section 4 thereof disallows a second motion for
reconsideration of a final order or judgment.

All these amendments are designed, as the decision sought to be reconsidered rightly states, to avoid the
procedural delays which plagued the administration of justice under the Rules of Court which are
intended to assist the parties in obtaining a just, speedy and inexpensive administration of justice.

However, the law and the Rules of Court do not expressly prohibit the filing of a motion for extension of
time to file a motion for reconsideration of a final order or judgment.

In the case of Gibbs vs. Court, of First Instance (80 Phil. 160), the Court dismissed the petition for
certiorari and ruled that the failure of defendant's attorney to file the petition to set aside the judgment
within the reglementary period was due to excusable neglect, and, consequently, the record on appeal was
allowed. The Court did not rule that the motion for extension of time to file a motion for new trial or
reconsideration could not be granted.

In the case of Roque vs. Gunigundo (Administrative Case No. 1684, March 30, 1979, 89 SCRA 178), a
division of the Court cited the Gibbs decision to support a statement that a motion to extend the
reglementary period for filing the motion for reconsideration is not authorized or is not in order.
The Intermediate Appellate Court is sharply divided on this issue. Appeals have been dismissed on the
basis of the original decision in this case.

After considering the able arguments of counsels for petitioners and respondents, the Court resolved that
the interest of justice would be better served if the ruling in the original decision were applied
prospectively from the time herein stated. The reason is that it would be unfair to deprive parties of their
right to appeal simply because they availed themselves of a procedure which was not expressly prohibited
or allowed by the law or the Rules. On the other hand, a motion for new trial or reconsideration is not a
pre-requisite to an appeal, a petition for review or a petition for review on certiorari, and since the purpose
of the amendments above referred to is to expedite the final disposition of cases, a strict but prospective
application of the said ruling is in order. Hence, for the guidance of Bench and Bar, the Court restates and
clarifies the rules on this point, as follows:

1.) Beginning one month after the promulgation of this Resolution, the rule shall be strictly enforced
that no motion for extension of time to file a motion for new trial or reconsideration may be filed with the
Metropolitan or Municipal Trial Courts, the Regional Trial Courts, and the Intermediate Appellate
Court. Such a motion may be filed only in cases pending with the Supreme Court as the court of last
resort, which may in its sound discretion either grant or deny the extension requested.

2.) In appeals in special proceedings under Rule 109 of the Rules of Court and in other cases wherein
multiple appeals are allowed, a motion for extension of time to file the record on appeal may be filed
within the reglementary period of thirty (30) days. (Moya vs. Barton, 76 Phil. 831; Heirs of Nantes vs.
Court of Appeals, July 25, 1983, 123 SCRA 753.) If the court denies the motion for extension, the appeal
must be taken within the original period (Bello vs. Fernando, January 30, 1962, 4 SCRA 135), inasmuch
as such a motion does not suspend the period for appeal (Reyes vs. Sta. Maria, November 20, 1972, 48
SCRA 1). The trial court may grant said motion after the expiration of the period for appeal provided it
was filed within the original period. (Valero vs. Court of Appeals, June 28, 1973, 51 SCRA 467;
Berkenkotter vs. Court of Appeals, September 28, 1973, 53 SCRA 228).

All appeals heretofore timely taken, after extensions of time were granted for the filing of a motion for
new trial or reconsideration, shall be allowed and determined on the merits.

WHEREFORE, the motion for reconsideration of, and to set aside, the decision of August 5, 1985 is
granted and the petition is dismissed. No costs.

SO ORDERED.

FIRST DIVISION

[A.M. No. MTJ-00-1329. March 8, 2001]

HERMINIA BORJA-MANZANO, petitioner, vs. JUDGE ROQUE R. SANCHEZ, MTC, Infanta,


Pangasinan, respondent.

RESOLUTION
DAVIDE, JR., C.J.:

The solemnization of a marriage between two contracting parties who were both bound by a prior
existing marriage is the bone of contention of the instant complaint against respondent Judge Roque R.
Sanchez, Municipal Trial Court, Infanta, Pangasinan. For this act, complainant Herminia Borja-Manzano
charges respondent Judge with gross ignorance of the law in a sworn Complaint-Affidavit filed with the
Office of the Court Administrator on 12 May 1999.
Complainant avers that she was the lawful wife of the late David Manzano, having been married to
him on 21 May 1966 in San Gabriel Archangel Parish, Araneta Avenue, Caloocan City. [1] Four children
were born out of that marriage.[2] On 22 March 1993, however, her husband contracted another marriage
with one Luzviminda Payao before respondent Judge.[3] When respondent Judge solemnized said
marriage, he knew or ought to know that the same was void and bigamous, as the marriage contract
clearly stated that both contracting parties were separated.
Respondent Judge, on the other hand, claims in his Comment that when he officiated the marriage
between Manzano and Payao he did not know that Manzano was legally married. What he knew was that
the two had been living together as husband and wife for seven years already without the benefit of
marriage, as manifested in their joint affidavit.[4] According to him, had he known that the late Manzano
was married, he would have advised the latter not to marry again; otherwise, he (Manzano) could be
charged with bigamy. He then prayed that the complaint be dismissed for lack of merit and for being
designed merely to harass him.
After an evaluation of the Complaint and the Comment, the Court Administrator recommended that
respondent Judge be found guilty of gross ignorance of the law and be ordered to pay a fine of P2,000,
with a warning that a repetition of the same or similar act would be dealt with more severely.
On 25 October 2000, this Court required the parties to manifest whether they were willing to submit
the case for resolution on the basis of the pleadings thus filed. Complainant answered in the affirmative.
For his part, respondent Judge filed a Manifestation reiterating his plea for the dismissal of the
complaint and setting aside his earlier Comment. He therein invites the attention of the Court to two
separate affidavits[5] of the late Manzano and of Payao, which were allegedly unearthed by a member of
his staff upon his instruction. In those affidavits, both David Manzano and Luzviminda Payao expressly
stated that they were married to Herminia Borja and Domingo Relos, respectively; and that since their
respective marriages had been marked by constant quarrels, they had both left their families and had
never cohabited or communicated with their spouses anymore. Respondent Judge alleges that on the basis
of those affidavits, he agreed to solemnize the marriage in question in accordance with Article 34 of the
Family Code.
We find merit in the complaint.
Article 34 of the Family Code provides:

No license shall be necessary for the marriage of a man and a woman who have lived together as husband
and wife for at least five years and without any legal impediment to marry each other. The contracting
parties shall state the foregoing facts in an affidavit before any person authorized by law to administer
oaths. The solemnizing officer shall also state under oath that he ascertained the qualifications of the
contracting parties and found no legal impediment to the marriage.

For this provision on legal ratification of marital cohabitation to apply, the following requisites must
concur:
1. The man and woman must have been living together as husband and wife for at least five
years before the marriage;
2. The parties must have no legal impediment to marry each other;
3. The fact of absence of legal impediment between the parties must be present at the time
of marriage;
4. The parties must execute an affidavit stating that they have lived together for at least five
years [and are without legal impediment to marry each other]; and
5. The solemnizing officer must execute a sworn statement that he had ascertained the
qualifications of the parties and that he had found no legal impediment to their marriage.[6]
Not all of these requirements are present in the case at bar. It is significant to note that in their
separate affidavits executed on 22 March 1993 and sworn to before respondent Judge himself, David
Manzano and Luzviminda Payao expressly stated the fact of their prior existing marriage. Also, in their
marriage contract, it was indicated that both were separated.
Respondent Judge knew or ought to know that a subsisting previous marriage is a diriment
impediment, which would make the subsequent marriage null and void.[7] In fact, in his Comment, he
stated that had he known that the late Manzano was married he would have discouraged him from
contracting another marriage. And respondent Judge cannot deny knowledge of Manzanos and Payaos
subsisting previous marriage, as the same was clearly stated in their separate affidavits which were
subscribed and sworn to before him.
The fact that Manzano and Payao had been living apart from their respective spouses for a long time
already is immaterial. Article 63(1) of the Family Code allows spouses who have obtained a decree of
legal separation to live separately from each other, but in such a case the marriage bonds are not
severed. Elsewise stated, legal separation does not dissolve the marriage tie, much less authorize the
parties to remarry. This holds true all the more when the separation is merely de facto, as in the case at
bar.
Neither can respondent Judge take refuge on the Joint Affidavit of David Manzano and Luzviminda
Payao stating that they had been cohabiting as husband and wife for seven years. Just like separation, free
and voluntary cohabitation with another person for at least five years does not severe the tie of a
subsisting previous marriage. Marital cohabitation for a long period of time between two individuals who
are legally capacitated to marry each other is merely a ground for exemption from marriage license. It
could not serve as a justification for respondent Judge to solemnize a subsequent marriage vitiated by the
impediment of a prior existing marriage.
Clearly, respondent Judge demonstrated gross ignorance of the law when he solemnized a void and
bigamous marriage. The maxim ignorance of the law excuses no one has special application to
judges,[8] who, under Rule 1.01 of the Code of Judicial Conduct, should be the embodiment of
competence, integrity, and independence. It is highly imperative that judges be conversant with the law
and basic legal principles.[9] And when the law transgressed is simple and elementary, the failure to know
it constitutes gross ignorance of the law.[10]
ACCORDINGLY, the recommendation of the Court Administrator is hereby ADOPTED, with
the MODIFICATION that the amount of fine to be imposed upon respondent Judge Roque Sanchez is
increased to P20,000.
SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

EN BANC

A.M. No. MTJ-92-706 March 29, 1995

LUPO ALMODIEL ATIENZA, complainant,


vs.
JUDGE FRANCISCO F. BRILLANTES, JR., Metropolitan Trial Court, Branch 28,
Manila, respondent.

QUIASON, J.:

This is a complaint by Lupo A. Atienza for Gross Immorality and Appearance of Impropriety against
Judge Francisco Brillantes, Jr., Presiding Judge of the Metropolitan Trial Court, Branch 20, Manila.

Complainant alleges that he has two children with Yolanda De Castro, who are living together at No. 34
Galaxy Street, Bel-Air Subdivision, Makati, Metro Manila. He stays in said house, which he purchased in
1987, whenever he is in Manila.

In December 1991, upon opening the door to his bedroom, he saw respondent sleeping on his
(complainant's) bed. Upon inquiry, he was told by the houseboy that respondent had been cohabiting with
De Castro. Complainant did not bother to wake up respondent and instead left the house after giving
instructions to his houseboy to take care of his children.

Thereafter, respondent prevented him from visiting his children and even alienated the affection of his
children for him.
Complainant claims that respondent is married to one Zenaida Ongkiko with whom he has five children,
as appearing in his 1986 and 1991 sworn statements of assets and liabilities. Furthermore, he alleges that
respondent caused his arrest on January 13, 1992, after he had a heated argument with De Castro inside
the latter's office.

For his part, respondent alleges that complainant was not married to De Castro and that the filing of the
administrative action was related to complainant's claim on the Bel-Air residence, which was disputed by
De Castro.

Respondent denies that he caused complainant's arrest and claims that he was even a witness to the
withdrawal of the complaint for Grave Slander filed by De Castro against complainant. According to him,
it was the sister of De Castro who called the police to arrest complainant.

Respondent also denies having been married to Ongkiko, although he admits having five children with
her. He alleges that while he and Ongkiko went through a marriage ceremony before a Nueva Ecija town
mayor on April 25, 1965, the same was not a valid marriage for lack of a marriage license. Upon the
request of the parents of Ongkiko, respondent went through another marriage ceremony with her in
Manila on June 5, 1965. Again, neither party applied for a marriage license. Ongkiko abandoned
respondent 17 years ago, leaving their children to his care and custody as a single parent.

Respondent claims that when he married De Castro in civil rites in Los Angeles, California on December
4, 1991, he believed, in all good faith and for all legal intents and purposes, that he was single because his
first marriage was solemnized without a license.

Under the Family Code, there must be a judicial declaration of the nullity of a previous marriage before a
party thereto can enter into a second marriage. Article 40 of said Code provides:

The absolute nullity of a previous marriage may be invoked for the purposes of
remarriage on the basis solely of a final judgment declaring such previous marriage void.

Respondent argues that the provision of Article 40 of the Family Code does not apply to him considering
that his first marriage took place in 1965 and was governed by the Civil Code of the Philippines; while
the second marriage took place in 1991 and governed by the Family Code.

Article 40 is applicable to remarriages entered into after the effectivity of the Family Code on August 3,
1988 regardless of the date of the first marriage. Besides, under Article 256 of the Family Code, said
Article is given "retroactive effect insofar as it does not prejudice or impair vested or acquired rights in
accordance with the Civil Code or other laws." This is particularly true with Article 40, which is a rule of
procedure. Respondent has not shown any vested right that was impaired by the application of Article 40
to his case.

The fact that procedural statutes may somehow affect the litigants' rights may not preclude their
retroactive application to pending actions. The retroactive application of procedural laws is not violative
of any right of a person who may feel that he is adversely affected (Gregorio v. Court of Appeals, 26
SCRA 229 [1968]). The reason is that as a general rule no vested right may attach to, nor arise from,
procedural laws (Billones v. Court of Industrial Relations, 14 SCRA 674 [1965]).

Respondent is the last person allowed to invoke good faith. He made a mockery of the institution of
marriage and employed deceit to be able to cohabit with a woman, who beget him five children.

Respondent passed the Bar examinations in 1962 and was admitted to the practice of law in 1963. At the
time he went through the two marriage ceremonies with Ongkiko, he was already a lawyer. Yet, he never
secured any marriage license. Any law student would know that a marriage license is necessary before
one can get married. Respondent was given an opportunity to correct the flaw in his first marriage when
he and Ongkiko were married for the second time. His failure to secure a marriage license on these two
occasions betrays his sinister motives and bad faith.

It is evident that respondent failed to meet the standard of moral fitness for membership in the legal
profession.
While the deceit employed by respondent existed prior to his appointment as a Metropolitan Trial Judge,
his immoral and illegal act of cohabiting with De Castro began and continued when he was already in the
judiciary.

The Code of Judicial Ethics mandates that the conduct of a judge must be free of a whiff of impropriety,
not only with respect to his performance of his judicial duties but also as to his behavior as a private
individual. There is no duality of morality. A public figure is also judged by his private life. A judge, in
order to promote public confidence in the integrity and impartiality of the judiciary, must behave with
propriety at all times, in the performance of his judicial duties and in his everyday life. These are judicial
guideposts too self-evident to be overlooked. No position exacts a greater demand on moral righteousness
and uprightness of an individual than a seat in the judiciary (Imbing v. Tiongzon, 229 SCRA 690 [1994]).

WHEREFORE, respondent is DISMISSED from the service with forfeiture of all leave and retirement
benefits and with prejudice to reappointment in any branch, instrumentality, or agency of the government,
including government-owned and controlled corporations. This decision is immediately executory.

SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 163707 September 15, 2006

MICHAEL C. GUY, petitioner,


vs.
HON. COURT OF APPEALS, HON. SIXTO MARELLA, JR., Presiding Judge, RTC, Branch 138,
Makati City and minors, KAREN DANES WEI and KAMILLE DANES WEI, represented by their
mother, REMEDIOS OANES, respondents.

DECISION

YNARES-SANTIAGO, J.:

This petition for review on certiorari assails the January 22, 2004 Decision1 of the Court of Appeals in
CA-G.R. SP No. 79742, which affirmed the Orders dated July 21, 20002 and July 17, 20033 of the
Regional Trial Court of Makati City, Branch 138 in SP Proc. Case No. 4549 denying petitioner's motion
to dismiss; and its May 25, 2004 Resolution4 denying petitioner's motion for reconsideration.

The facts are as follows:

On June 13, 1997, private respondent-minors Karen Oanes Wei and Kamille Oanes Wei, represented by
their mother Remedios Oanes (Remedios), filed a petition for letters of administration5 before the
Regional Trial Court of Makati City, Branch 138. The case was docketed as Sp. Proc. No. 4549 and
entitled Intestate Estate of Sima Wei (a.k.a. Rufino Guy Susim).

Private respondents alleged that they are the duly acknowledged illegitimate children of Sima Wei, who
died intestate in Makati City on October 29, 1992, leaving an estate valued at P10,000,000.00 consisting
of real and personal properties. His known heirs are his surviving spouse Shirley Guy and children, Emy,
Jeanne, Cristina, George and Michael, all surnamed Guy. Private respondents prayed for the appointment
of a regular administrator for the orderly settlement of Sima Wei's estate. They likewise prayed that, in
the meantime, petitioner Michael C. Guy, son of the decedent, be appointed as Special Administrator of
the estate. Attached to private respondents' petition was a Certification Against Forum Shopping6 signed
by their counsel, Atty. Sedfrey A. Ordoñez.

In his Comment/Opposition,7 petitioner prayed for the dismissal of the petition. He asserted that his
deceased father left no debts and that his estate can be settled without securing letters of administration
pursuant to Section 1, Rule 74 of the Rules of Court. He further argued that private respondents should
have established their status as illegitimate children during the lifetime of Sima Wei pursuant to Article
175 of the Family Code.

The other heirs of Sima Wei filed a Joint Motion to Dismiss8 on the ground that the certification against
forum shopping should have been signed by private respondents and not their counsel. They contended
that Remedios should have executed the certification on behalf of her minor daughters as mandated by
Section 5, Rule 7 of the Rules of Court.

In a Manifestation/Motion as Supplement to the Joint Motion to Dismiss,9 petitioner and his co-heirs
alleged that private respondents' claim had been paid, waived, abandoned or otherwise extinguished by
reason of Remedios' June 7, 1993 Release and Waiver of Claim stating that in exchange for the financial
and educational assistance received from petitioner, Remedios and her minor children discharge the estate
of Sima Wei from any and all liabilities.

The Regional Trial Court denied the Joint Motion to Dismiss as well as the Supplemental Motion to
Dismiss. It ruled that while the Release and Waiver of Claim was signed by Remedios, it had not been
established that she was the duly constituted guardian of her minor daughters. Thus, no renunciation of
right occurred. Applying a liberal application of the rules, the trial court also rejected petitioner's
objections on the certification against forum shopping.

Petitioner moved for reconsideration but was denied. He filed a petition for certiorari before the Court of
Appeals which affirmed the orders of the Regional Trial Court in its assailed Decision dated January 22,
2004, the dispositive portion of which states:

WHEREFORE, premises considered, the present petition is hereby DENIED DUE COURSE and
accordingly DISMISSED, for lack of merit. Consequently, the assailed Orders dated July 21,
2000 and July 17, 2003 are hereby both AFFIRMED. Respondent Judge is hereby DIRECTED to
resolve the controversy over the illegitimate filiation of the private respondents (sic) minors [-]
Karen Oanes Wei and Kamille Oanes Wei who are claiming successional rights in the intestate
estate of the deceased Sima Wei, a.k.a. Rufino Guy Susim.

SO ORDERED.10

The Court of Appeals denied petitioner's motion for reconsideration, hence, this petition.

Petitioner argues that the Court of Appeals disregarded existing rules on certification against forum
shopping; that the Release and Waiver of Claim executed by Remedios released and discharged the Guy
family and the estate of Sima Wei from any claims or liabilities; and that private respondents do not have
the legal personality to institute the petition for letters of administration as they failed to prove their
filiation during the lifetime of Sima Wei in accordance with Article 175 of the Family Code.

Private respondents contend that their counsel's certification can be considered substantial compliance
with the rules on certification of non-forum shopping, and that the petition raises no new issues to warrant
the reversal of the decisions of the Regional Trial Court and the Court of Appeals.

The issues for resolution are: 1) whether private respondents' petition should be dismissed for failure to
comply with the rules on certification of non-forum shopping; 2) whether the Release and Waiver of
Claim precludes private respondents from claiming their successional rights; and 3) whether private
respondents are barred by prescription from proving their filiation.

The petition lacks merit.

Rule 7, Section 5 of the Rules of Court provides that the certification of non-forum shopping should be
executed by the plaintiff or the principal party. Failure to comply with the requirement shall be cause for
dismissal of the case. However, a liberal application of the rules is proper where the higher interest of
justice would be served. InSy Chin v. Court of Appeals,11 we ruled that while a petition may have been
flawed where the certificate of non-forum shopping was signed only by counsel and not by the party, this
procedural lapse may be overlooked in the interest of substantial justice.12 So it is in the present
controversy where the merits13 of the case and the absence of an intention to violate the rules with
impunity should be considered as compelling reasons to temper the strict application of the rules.
As regards Remedios' Release and Waiver of Claim, the same does not bar private respondents from
claiming successional rights. To be valid and effective, a waiver must be couched in clear and
unequivocal terms which leave no doubt as to the intention of a party to give up a right or benefit which
legally pertains to him. A waiver may not be attributed to a person when its terms do not explicitly and
clearly evince an intent to abandon a right.14

In this case, we find that there was no waiver of hereditary rights. The Release and Waiver of Claim does
not state with clarity the purpose of its execution. It merely states that Remedios received P300,000.00
and an educational plan for her minor daughters "by way of financial assistance and in full settlement of
any and all claims of whatsoever nature and kind x x x against the estate of the late Rufino Guy
Susim."15 Considering that the document did not specifically mention private respondents' hereditary
share in the estate of Sima Wei, it cannot be construed as a waiver of successional rights.

Moreover, even assuming that Remedios truly waived the hereditary rights of private respondents, such
waiver will not bar the latter's claim. Article 1044 of the Civil Code, provides:

ART. 1044. Any person having the free disposal of his property may accept or repudiate an
inheritance.

Any inheritance left to minors or incapacitated persons may be accepted by their parents or
guardians. Parents or guardians may repudiate the inheritance left to their wards only by
judicial authorization.

The right to accept an inheritance left to the poor shall belong to the persons designated by the
testator to determine the beneficiaries and distribute the property, or in their default, to those
mentioned in Article 1030. (Emphasis supplied)

Parents and guardians may not therefore repudiate the inheritance of their wards without judicial
approval. This is because repudiation amounts to an alienation of property16 which must pass the court's
scrutiny in order to protect the interest of the ward. Not having been judicially authorized, the Release and
Waiver of Claim in the instant case is void and will not bar private respondents from asserting their rights
as heirs of the deceased.

Furthermore, it must be emphasized that waiver is the intentional relinquishment of a known right. Where
one lacks knowledge of a right, there is no basis upon which waiver of it can rest. Ignorance of a material
fact negates waiver, and waiver cannot be established by a consent given under a mistake or
misapprehension of fact.17

In the present case, private respondents could not have possibly waived their successional rights because
they are yet to prove their status as acknowledged illegitimate children of the deceased. Petitioner himself
has consistently denied that private respondents are his co-heirs. It would thus be inconsistent to rule that
they waived their hereditary rights when petitioner claims that they do not have such right. Hence,
petitioner's invocation of waiver on the part of private respondents must fail.

Anent the issue on private respondents' filiation, we agree with the Court of Appeals that a ruling on the
same would be premature considering that private respondents have yet to present evidence. Before the
Family Code took effect, the governing law on actions for recognition of illegitimate children was Article
285 of the Civil Code, to wit:

ART. 285. The action for the recognition of natural children may be brought only during the
lifetime of the presumed parents, except in the following cases:

(1) If the father or mother died during the minority of the child, in which case the latter
may file the action before the expiration of four years from the attainment of his majority;

(2) If after the death of the father or of the mother a document should appear of which nothing
had been heard and in which either or both parents recognize the child.

In this case, the action must be commenced within four years from the finding of the document.
(Emphasis supplied)
We ruled in Bernabe v. Alejo18 that illegitimate children who were still minors at the time the Family
Code took effect and whose putative parent died during their minority are given the right to seek
recognition for a period of up to four years from attaining majority age. This vested right was not
impaired or taken away by the passage of the Family Code.19

On the other hand, Articles 172, 173 and 175 of the Family Code, which superseded Article 285 of the
Civil Code, provide:

ART. 172. The filiation of legitimate children is established by any of the following:

(1) The record of birth appearing in the civil register or a final judgment; or

(2) An admission of legitimate filiation in a public document or a private handwritten instrument


and signed by the parent concerned.

In the absence of the foregoing evidence, the legitimate filiation shall be proved by:

(1) The open and continuous possession of the status of a legitimate child; or

(2) Any other means allowed by the Rules of Court and special laws.

ART. 173. The action to claim legitimacy may be brought by the child during his or her lifetime
and shall be transmitted to the heirs should the child die during minority or in a state of insanity.
In these cases, the heirs shall have a period of five years within which to institute the action.

The action already commenced by the child shall survive notwithstanding the death of either or
both of the parties.

ART. 175. Illegitimate children may establish their illegitimate filiation in the same way and on
the same, evidence as legitimate children.

The action must be brought within the same period specified in Article 173, except when the
action is based on the second paragraph of Article 172, in which case the action may be brought
during the lifetime of the alleged parent.

Under the Family Code, when filiation of an illegitimate child is established by a record of birth
appearing in the civil register or a final judgment, or an admission of filiation in a public document or a
private handwritten instrument signed by the parent concerned, the action for recognition may be brought
by the child during his or her lifetime. However, if the action is based upon open and continuous
possession of the status of an illegitimate child, or any other means allowed by the rules or special laws, it
may only be brought during the lifetime of the alleged parent.

It is clear therefore that the resolution of the issue of prescription depends on the type of evidence to be
adduced by private respondents in proving their filiation. However, it would be impossible to determine
the same in this case as there has been no reception of evidence yet. This Court is not a trier of facts. Such
matters may be resolved only by the Regional Trial Court after a full-blown trial.

While the original action filed by private respondents was a petition for letters of administration, the trial
court is not precluded from receiving evidence on private respondents' filiation. Its jurisdiction extends to
matters incidental and collateral to the exercise of its recognized powers in handling the settlement of the
estate, including the determination of the status of each heir.20 That the two causes of action, one to
compel recognition and the other to claim inheritance, may be joined in one complaint is not new in our
jurisprudence.21 As held in Briz v. Briz:22

The question whether a person in the position of the present plaintiff can in any event maintain a
complex action to compel recognition as a natural child and at the same time to obtain ulterior
relief in the character of heir, is one which in the opinion of this court must be answered in the
affirmative, provided always that the conditions justifying the joinder of the two distinct causes of
action are present in the particular case. In other words, there is no absolute necessity requiring
that the action to compel acknowledgment should have been instituted and prosecuted to a
successful conclusion prior to the action in which that same plaintiff seeks additional relief in the
character of heir. Certainly, there is nothing so peculiar to the action to compel acknowledgment
as to require that a rule should be here applied different from that generally applicable in other
cases. x x x

The conclusion above stated, though not heretofore explicitly formulated by this court, is
undoubtedly to some extent supported by our prior decisions. Thus, we have held in numerous
cases, and the doctrine must be considered well settled, that a natural child having a right to
compel acknowledgment, but who has not been in fact acknowledged, may maintain partition
proceedings for the division of the inheritance against his coheirs (Siguiong vs. Siguiong, 8 Phil.,
5; Tiamson vs. Tiamson, 32 Phil., 62); and the same person may intervene in proceedings for the
distribution of the estate of his deceased natural father, or mother (Capistrano vs. Fabella, 8 Phil.,
135; Conde vs. Abaya, 13 Phil., 249; Ramirez vs. Gmur, 42 Phil., 855). In neither of these
situations has it been thought necessary for the plaintiff to show a prior decree compelling
acknowledgment. The obvious reason is that in partition suits and distribution proceedings the
other persons who might take by inheritance are before the court; and the declaration of heirship
is appropriate to such proceedings.

WHEREFORE, the instant petition is DENIED. The Decision dated January 22, 2004 of the Court of
Appeals in CA-G.R. SP No. 79742 affirming the denial of petitioner's motion to dismiss; and its
Resolution dated May 25, 2004 denying petitioner's motion for reconsideration, are AFFIRMED. Let the
records be REMANDED to the Regional Trial Court of Makati City, Branch 138 for further proceedings.

SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

EN BANC

G.R. No. L-16749 January 31, 1963

IN THE MATTER OF THE TESTATE ESTATE OF EDWARD E. CHRISTENSEN,


DECEASED.
ADOLFO C. AZNAR, Executor and LUCY CHRISTENSEN, Heir of the deceased, Executor and
Heir-appellees,
vs.
HELEN CHRISTENSEN GARCIA, oppositor-appellant.

M. R. Sotelo for executor and heir-appellees.


Leopoldo M. Abellera and Jovito Salonga for oppositor-appellant.

LABRADOR, J.:

This is an appeal from a decision of the Court of First Instance of Davao, Hon. Vicente N. Cusi, Jr.,
presiding, in Special Proceeding No. 622 of said court, dated September 14, 1949, approving among
things the final accounts of the executor, directing the executor to reimburse Maria Lucy Christensen the
amount of P3,600 paid by her to Helen Christensen Garcia as her legacy, and declaring Maria Lucy
Christensen entitled to the residue of the property to be enjoyed during her lifetime, and in case of death
without issue, one-half of said residue to be payable to Mrs. Carrie Louise C. Borton, etc., in accordance
with the provisions of the will of the testator Edward E. Christensen. The will was executed in Manila on
March 5, 1951 and contains the following provisions:

3. I declare ... that I have but ONE (1) child, named MARIA LUCY CHRISTENSEN (now Mrs.
Bernard Daney), who was born in the Philippines about twenty-eight years ago, and who is now
residing at No. 665 Rodger Young Village, Los Angeles, California, U.S.A.

4. I further declare that I now have no living ascendants, and no descendants except my above
named daughter, MARIA LUCY CHRISTENSEN DANEY.

xxx xxx xxx

7. I give, devise and bequeath unto MARIA HELEN CHRISTENSEN, now married to Eduardo
Garcia, about eighteen years of age and who, notwithstanding the fact that she was baptized
Christensen, is not in any way related to me, nor has she been at any time adopted by me, and
who, from all information I have now resides in Egpit, Digos, Davao, Philippines, the sum of
THREE THOUSAND SIX HUNDRED PESOS (P3,600.00), Philippine Currency the same to be
deposited in trust for the said Maria Helen Christensen with the Davao Branch of the Philippine
National Bank, and paid to her at the rate of One Hundred Pesos (P100.00), Philippine Currency
per month until the principal thereof as well as any interest which may have accrued thereon, is
exhausted..

xxx xxx xxx

12. I hereby give, devise and bequeath, unto my well-beloved daughter, the said MARIA LUCY
CHRISTENSEN DANEY (Mrs. Bernard Daney), now residing as aforesaid at No. 665 Rodger
Young Village, Los Angeles, California, U.S.A., all the income from the rest, remainder, and
residue of my property and estate, real, personal and/or mixed, of whatsoever kind or character,
and wheresoever situated, of which I may be possessed at my death and which may have come to
me from any source whatsoever, during her lifetime: ....

It is in accordance with the above-quoted provisions that the executor in his final account and project of
partition ratified the payment of only P3,600 to Helen Christensen Garcia and proposed that the residue of
the estate be transferred to his daughter, Maria Lucy Christensen.

Opposition to the approval of the project of partition was filed by Helen Christensen Garcia, insofar as it
deprives her (Helen) of her legitime as an acknowledged natural child, she having been declared by Us in
G.R. Nos. L-11483-84 an acknowledged natural child of the deceased Edward E. Christensen. The legal
grounds of opposition are (a) that the distribution should be governed by the laws of the Philippines, and
(b) that said order of distribution is contrary thereto insofar as it denies to Helen Christensen, one of two
acknowledged natural children, one-half of the estate in full ownership. In amplification of the above
grounds it was alleged that the law that should govern the estate of the deceased Christensen should not
be the internal law of California alone, but the entire law thereof because several foreign elements are
involved, that the forum is the Philippines and even if the case were decided in California, Section 946 of
the California Civil Code, which requires that the domicile of the decedent should apply, should be
applicable. It was also alleged that Maria Helen Christensen having been declared an acknowledged
natural child of the decedent, she is deemed for all purposes legitimate from the time of her birth.

The court below ruled that as Edward E. Christensen was a citizen of the United States and of the State of
California at the time of his death, the successional rights and intrinsic validity of the provisions in his
will are to be governed by the law of California, in accordance with which a testator has the right to
dispose of his property in the way he desires, because the right of absolute dominion over his property is
sacred and inviolable (In re McDaniel's Estate, 77 Cal. Appl. 2d 877, 176 P. 2d 952, and In re Kaufman,
117 Cal. 286, 49 Pac. 192, cited in page 179, Record on Appeal). Oppositor Maria Helen Christensen,
through counsel, filed various motions for reconsideration, but these were denied. Hence, this appeal.

The most important assignments of error are as follows:

I
THE LOWER COURT ERRED IN IGNORING THE DECISION OF THE HONORABLE SUPREME
COURT THAT HELEN IS THE ACKNOWLEDGED NATURAL CHILD OF EDWARD E.
CHRISTENSEN AND, CONSEQUENTLY, IN DEPRIVING HER OF HER JUST SHARE IN THE
INHERITANCE.

II

THE LOWER COURT ERRED IN ENTIRELY IGNORING AND/OR FAILING TO RECOGNIZE


THE EXISTENCE OF SEVERAL FACTORS, ELEMENTS AND CIRCUMSTANCES CALLING FOR
THE APPLICATION OF INTERNAL LAW.

III

THE LOWER COURT ERRED IN FAILING TO RECOGNIZE THAT UNDER INTERNATIONAL


LAW, PARTICULARLY UNDER THE RENVOI DOCTRINE, THE INTRINSIC VALIDITY OF THE
TESTAMENTARY DISPOSITION OF THE DISTRIBUTION OF THE ESTATE OF THE DECEASED
EDWARD E. CHRISTENSEN SHOULD BE GOVERNED BY THE LAWS OF THE PHILIPPINES.

IV

THE LOWER COURT ERRED IN NOT DECLARING THAT THE SCHEDULE OF DISTRIBUTION
SUBMITTED BY THE EXECUTOR IS CONTRARY TO THE PHILIPPINE LAWS.

THE LOWER COURT ERRED IN NOT DECLARING THAT UNDER THE PHILIPPINE LAWS
HELEN CHRISTENSEN GARCIA IS ENTITLED TO ONE-HALF (1/2) OF THE ESTATE IN FULL
OWNERSHIP.

There is no question that Edward E. Christensen was a citizen of the United States and of the State of
California at the time of his death. But there is also no question that at the time of his death he was
domiciled in the Philippines, as witness the following facts admitted by the executor himself in appellee's
brief:

In the proceedings for admission of the will to probate, the facts of record show that the deceased
Edward E. Christensen was born on November 29, 1875 in New York City, N.Y., U.S.A.; his first
arrival in the Philippines, as an appointed school teacher, was on July 1, 1901, on board the U.S.
Army Transport "Sheridan" with Port of Embarkation as the City of San Francisco, in the State of
California, U.S.A. He stayed in the Philippines until 1904.

In December, 1904, Mr. Christensen returned to the United States and stayed there for the
following nine years until 1913, during which time he resided in, and was teaching school in
Sacramento, California.

Mr. Christensen's next arrival in the Philippines was in July of the year 1913. However, in 1928,
he again departed the Philippines for the United States and came back here the following year,
1929. Some nine years later, in 1938, he again returned to his own country, and came back to the
Philippines the following year, 1939.

Wherefore, the parties respectfully pray that the foregoing stipulation of facts be admitted and
approved by this Honorable Court, without prejudice to the parties adducing other evidence to
prove their case not covered by this stipulation of facts. 1äwphï1.ñët

Being an American citizen, Mr. Christensen was interned by the Japanese Military Forces in the
Philippines during World War II. Upon liberation, in April 1945, he left for the United States but
returned to the Philippines in December, 1945. Appellees Collective Exhibits "6", CFI Davao, Sp.
Proc. 622, as Exhibits "AA", "BB" and "CC-Daney"; Exhs. "MM", "MM-l", "MM-2-Daney" and
p. 473, t.s.n., July 21, 1953.)

In April, 1951, Edward E. Christensen returned once more to California shortly after the making
of his last will and testament (now in question herein) which he executed at his lawyers' offices in
Manila on March 5, 1951. He died at the St. Luke's Hospital in the City of Manila on April 30,
1953. (pp. 2-3)

In arriving at the conclusion that the domicile of the deceased is the Philippines, we are persuaded by the
fact that he was born in New York, migrated to California and resided there for nine years, and since he
came to the Philippines in 1913 he returned to California very rarely and only for short visits (perhaps to
relatives), and considering that he appears never to have owned or acquired a home or properties in that
state, which would indicate that he would ultimately abandon the Philippines and make home in the State
of California.

Sec. 16. Residence is a term used with many shades of meaning from mere temporary presence to
the most permanent abode. Generally, however, it is used to denote something more than mere
physical presence. (Goodrich on Conflict of Laws, p. 29)

As to his citizenship, however, We find that the citizenship that he acquired in California when he resided
in Sacramento, California from 1904 to 1913, was never lost by his stay in the Philippines, for the latter
was a territory of the United States (not a state) until 1946 and the deceased appears to have considered
himself as a citizen of California by the fact that when he executed his will in 1951 he declared that he
was a citizen of that State; so that he appears never to have intended to abandon his California citizenship
by acquiring another. This conclusion is in accordance with the following principle expounded by
Goodrich in his Conflict of Laws.

The terms "'residence" and "domicile" might well be taken to mean the same thing, a place of
permanent abode. But domicile, as has been shown, has acquired a technical meaning. Thus one
may be domiciled in a place where he has never been. And he may reside in a place where he has
no domicile. The man with two homes, between which he divides his time, certainly resides in
each one, while living in it. But if he went on business which would require his presence for
several weeks or months, he might properly be said to have sufficient connection with the place
to be called a resident. It is clear, however, that, if he treated his settlement as continuing only for
the particular business in hand, not giving up his former "home," he could not be a domiciled
New Yorker. Acquisition of a domicile of choice requires the exercise of intention as well as
physical presence. "Residence simply requires bodily presence of an inhabitant in a given place,
while domicile requires bodily presence in that place and also an intention to make it one's
domicile." Residence, however, is a term used with many shades of meaning, from the merest
temporary presence to the most permanent abode, and it is not safe to insist that any one use et the
only proper one. (Goodrich, p. 29)

The law that governs the validity of his testamentary dispositions is defined in Article 16 of the Civil
Code of the Philippines, which is as follows:

ART. 16. Real property as well as personal property is subject to the law of the country where it
is situated.

However, intestate and testamentary successions, both with respect to the order of succession and
to the amount of successional rights and to the intrinsic validity of testamentary provisions, shall
be regulated by the national law of the person whose succession is under consideration, whatever
may be the nature of the property and regardless of the country where said property may be
found.

The application of this article in the case at bar requires the determination of the meaning of the
term "national law" is used therein.

There is no single American law governing the validity of testamentary provisions in the United States,
each state of the Union having its own private law applicable to its citizens only and in force only within
the state. The "national law" indicated in Article 16 of the Civil Code above quoted can not, therefore,
possibly mean or apply to any general American law. So it can refer to no other than the private law of the
State of California.

The next question is: What is the law in California governing the disposition of personal property? The
decision of the court below, sustains the contention of the executor-appellee that under the California
Probate Code, a testator may dispose of his property by will in the form and manner he desires, citing the
case of Estate of McDaniel, 77 Cal. Appl. 2d 877, 176 P. 2d 952. But appellant invokes the provisions of
Article 946 of the Civil Code of California, which is as follows:

If there is no law to the contrary, in the place where personal property is situated, it is deemed to
follow the person of its owner, and is governed by the law of his domicile.

The existence of this provision is alleged in appellant's opposition and is not denied. We have checked it
in the California Civil Code and it is there. Appellee, on the other hand, relies on the case cited in the
decision and testified to by a witness. (Only the case of Kaufman is correctly cited.) It is argued on
executor's behalf that as the deceased Christensen was a citizen of the State of California, the internal law
thereof, which is that given in the abovecited case, should govern the determination of the validity of the
testamentary provisions of Christensen's will, such law being in force in the State of California of which
Christensen was a citizen. Appellant, on the other hand, insists that Article 946 should be applicable, and
in accordance therewith and following the doctrine of therenvoi, the question of the validity of the
testamentary provision in question should be referred back to the law of the decedent's domicile, which is
the Philippines.

The theory of doctrine of renvoi has been defined by various authors, thus:

The problem has been stated in this way: "When the Conflict of Laws rule of the forum refers a
jural matter to a foreign law for decision, is the reference to the purely internal rules of law of the
foreign system; i.e., to the totality of the foreign law minus its Conflict of Laws rules?"

On logic, the solution is not an easy one. The Michigan court chose to accept the renvoi, that is,
applied the Conflict of Laws rule of Illinois which referred the matter back to Michigan law. But
once having determined the the Conflict of Laws principle is the rule looked to, it is difficult to
see why the reference back should not have been to Michigan Conflict of Laws. This would have
resulted in the "endless chain of references" which has so often been criticized be legal writers.
The opponents of the renvoi would have looked merely to the internal law of Illinois, thus
rejecting the renvoi or the reference back. Yet there seems no compelling logical reason why the
original reference should be the internal law rather than to the Conflict of Laws rule. It is true that
such a solution avoids going on a merry-go-round, but those who have accepted the renvoitheory
avoid this inextricabilis circulas by getting off at the second reference and at that point applying
internal law. Perhaps the opponents of the renvoi are a bit more consistent for they look always to
internal law as the rule of reference.

Strangely enough, both the advocates for and the objectors to the renvoi plead that greater
uniformity will result from adoption of their respective views. And still more strange is the fact
that the only way to achieve uniformity in this choice-of-law problem is if in the dispute the two
states whose laws form the legal basis of the litigation disagree as to whether the renvoi should be
accepted. If both reject, or both accept the doctrine, the result of the litigation will vary with the
choice of the forum. In the case stated above, had the Michigan court rejected the renvoi,
judgment would have been against the woman; if the suit had been brought in the Illinois courts,
and they too rejected the renvoi, judgment would be for the woman. The same result would
happen, though the courts would switch with respect to which would hold liability, if both courts
accepted the renvoi.

The Restatement accepts the renvoi theory in two instances: where the title to land is in question,
and where the validity of a decree of divorce is challenged. In these cases the Conflict of Laws
rule of the situs of the land, or the domicile of the parties in the divorce case, is applied by the
forum, but any further reference goes only to the internal law. Thus, a person's title to land,
recognized by the situs, will be recognized by every court; and every divorce, valid by the
domicile of the parties, will be valid everywhere. (Goodrich, Conflict of Laws, Sec. 7, pp. 13-14.)

X, a citizen of Massachusetts, dies intestate, domiciled in France, leaving movable property in


Massachusetts, England, and France. The question arises as to how this property is to be
distributed among X's next of kin.

Assume (1) that this question arises in a Massachusetts court. There the rule of the conflict of
laws as to intestate succession to movables calls for an application of the law of the deceased's
last domicile. Since by hypothesis X's last domicile was France, the natural thing for the
Massachusetts court to do would be to turn to French statute of distributions, or whatever
corresponds thereto in French law, and decree a distribution accordingly. An examination of
French law, however, would show that if a French court were called upon to determine how this
property should be distributed, it would refer the distribution to the national law of the deceased,
thus applying the Massachusetts statute of distributions. So on the surface of things the
Massachusetts court has open to it alternative course of action: (a) either to apply the French law
is to intestate succession, or (b) to resolve itself into a French court and apply the Massachusetts
statute of distributions, on the assumption that this is what a French court would do. If it accepts
the so-called renvoidoctrine, it will follow the latter course, thus applying its own law.

This is one type of renvoi. A jural matter is presented which the conflict-of-laws rule of the forum
refers to a foreign law, the conflict-of-laws rule of which, in turn, refers the matter back again to
the law of the forum. This is renvoi in the narrower sense. The German term for this judicial
process is 'Ruckverweisung.'" (Harvard Law Review, Vol. 31, pp. 523-571.)

After a decision has been arrived at that a foreign law is to be resorted to as governing a particular
case, the further question may arise: Are the rules as to the conflict of laws contained in such
foreign law also to be resorted to? This is a question which, while it has been considered by the
courts in but a few instances, has been the subject of frequent discussion by textwriters and
essayists; and the doctrine involved has been descriptively designated by them as the "Renvoyer"
to send back, or the "Ruchversweisung", or the "Weiterverweisung", since an affirmative answer
to the question postulated and the operation of the adoption of the foreign law in toto would in
many cases result in returning the main controversy to be decided according to the law of the
forum. ... (16 C.J.S. 872.)

Another theory, known as the "doctrine of renvoi", has been advanced. The theory of the doctrine
of renvoiis that the court of the forum, in determining the question before it, must take into
account the whole law of the other jurisdiction, but also its rules as to conflict of laws, and then
apply the law to the actual question which the rules of the other jurisdiction prescribe. This may
be the law of the forum. The doctrine of therenvoi has generally been repudiated by the American
authorities. (2 Am. Jur. 296)

The scope of the theory of renvoi has also been defined and the reasons for its application in a country
explained by Prof. Lorenzen in an article in the Yale Law Journal, Vol. 27, 1917-1918, pp. 529-531. The
pertinent parts of the article are quoted herein below:

The recognition of the renvoi theory implies that the rules of the conflict of laws are to be
understood as incorporating not only the ordinary or internal law of the foreign state or country,
but its rules of the conflict of laws as well. According to this theory 'the law of a country' means
the whole of its law.

xxx xxx xxx

Von Bar presented his views at the meeting of the Institute of International Law, at Neuchatel, in
1900, in the form of the following theses:

(1) Every court shall observe the law of its country as regards the application of foreign laws.

(2) Provided that no express provision to the contrary exists, the court shall respect:

(a) The provisions of a foreign law which disclaims the right to bind its nationals abroad
as regards their personal statute, and desires that said personal statute shall be determined
by the law of the domicile, or even by the law of the place where the act in question
occurred.

(b) The decision of two or more foreign systems of law, provided it be certain that one of
them is necessarily competent, which agree in attributing the determination of a question
to the same system of law.

xxx xxx xxx


If, for example, the English law directs its judge to distribute the personal estate of an Englishman
who has died domiciled in Belgium in accordance with the law of his domicile, he must first
inquire whether the law of Belgium would distribute personal property upon death in accordance
with the law of domicile, and if he finds that the Belgian law would make the distribution in
accordance with the law of nationality — that is the English law — he must accept this reference
back to his own law.

We note that Article 946 of the California Civil Code is its conflict of laws rule, while the rule applied in
In re Kaufman, Supra, its internal law. If the law on succession and the conflict of laws rules of California
are to be enforced jointly, each in its own intended and appropriate sphere, the principle cited In re
Kaufman should apply to citizens living in the State, but Article 946 should apply to such of its citizens as
are not domiciled in California but in other jurisdictions. The rule laid down of resorting to the law of the
domicile in the determination of matters with foreign element involved is in accord with the general
principle of American law that the domiciliary law should govern in most matters or rights which follow
the person of the owner.

When a man dies leaving personal property in one or more states, and leaves a will directing the
manner of distribution of the property, the law of the state where he was domiciled at the time of
his death will be looked to in deciding legal questions about the will, almost as completely as the
law of situs is consulted in questions about the devise of land. It is logical that, since the
domiciliary rules control devolution of the personal estate in case of intestate succession, the
same rules should determine the validity of an attempted testamentary dispostion of the property.
Here, also, it is not that the domiciliary has effect beyond the borders of the domiciliary state. The
rules of the domicile are recognized as controlling by the Conflict of Laws rules at the situs
property, and the reason for the recognition as in the case of intestate succession, is the general
convenience of the doctrine. The New York court has said on the point: 'The general principle
that a dispostiton of a personal property, valid at the domicile of the owner, is valid anywhere, is
one of the universal application. It had its origin in that international comity which was one of the
first fruits of civilization, and it this age, when business intercourse and the process of
accumulating property take but little notice of boundary lines, the practical wisdom and justice of
the rule is more apparent than ever. (Goodrich, Conflict of Laws, Sec. 164, pp. 442-443.)

Appellees argue that what Article 16 of the Civil Code of the Philippines pointed out as the national
law is the internal law of California. But as above explained the laws of California have prescribed two
sets of laws for its citizens, one for residents therein and another for those domiciled in other jurisdictions.
Reason demands that We should enforce the California internal law prescribed for its citizens residing
therein, and enforce the conflict of laws rules for the citizens domiciled abroad. If we must enforce the
law of California as in comity we are bound to go, as so declared in Article 16 of our Civil Code, then we
must enforce the law of California in accordance with the express mandate thereof and as above
explained, i.e., apply the internal law for residents therein, and its conflict-of-laws rule for those
domiciled abroad.

It is argued on appellees' behalf that the clause "if there is no law to the contrary in the place where the
property is situated" in Sec. 946 of the California Civil Code refers to Article 16 of the Civil Code of the
Philippines and that the law to the contrary in the Philippines is the provision in said Article 16 that
the national law of the deceased should govern. This contention can not be sustained. As explained in the
various authorities cited above the national law mentioned in Article 16 of our Civil Code is the law on
conflict of laws in the California Civil Code, i.e., Article 946, which authorizes the reference or return of
the question to the law of the testator's domicile. The conflict of laws rule in California, Article 946, Civil
Code, precisely refers back the case, when a decedent is not domiciled in California, to the law of his
domicile, the Philippines in the case at bar. The court of the domicile can not and should not refer the case
back to California; such action would leave the issue incapable of determination because the case will
then be like a football, tossed back and forth between the two states, between the country of which the
decedent was a citizen and the country of his domicile. The Philippine court must apply its own law as
directed in the conflict of laws rule of the state of the decedent, if the question has to be decided,
especially as the application of the internal law of California provides no legitime for children while the
Philippine law, Arts. 887(4) and 894, Civil Code of the Philippines, makes natural children legally
acknowledged forced heirs of the parent recognizing them.

The Philippine cases (In re Estate of Johnson, 39 Phil. 156; Riera vs. Palmaroli, 40 Phil. 105; Miciano vs.
Brimo, 50 Phil. 867; Babcock Templeton vs. Rider Babcock, 52 Phil. 130; and Gibbs vs. Government, 59
Phil. 293.) cited by appellees to support the decision can not possibly apply in the case at bar, for two
important reasons, i.e., the subject in each case does not appear to be a citizen of a state in the United
States but with domicile in the Philippines, and it does not appear in each case that there exists in the state
of which the subject is a citizen, a law similar to or identical with Art. 946 of the California Civil Code.

We therefore find that as the domicile of the deceased Christensen, a citizen of California, is the
Philippines, the validity of the provisions of his will depriving his acknowledged natural child, the
appellant, should be governed by the Philippine Law, the domicile, pursuant to Art. 946 of the Civil Code
of California, not by the internal law of California..

WHEREFORE, the decision appealed from is hereby reversed and the case returned to the lower court
with instructions that the partition be made as the Philippine law on succession provides. Judgment
reversed, with costs against appellees.

Padilla, Bautista Angelo, Concepcion, Reyes, Barrera, Paredes, Dizon, Regala and Makalintal, JJ.,
concur.
Bengzon, C.J., took no part.

Republic of the Philippines


SUPREME COURT
Manila

FIRST DIVISION

G.R. No. L-68470 October 8, 1985

ALICE REYES VAN DORN, petitioner,


vs.
HON. MANUEL V. ROMILLO, JR., as Presiding Judge of Branch CX, Regional Trial Court of the
National Capital Region Pasay City and RICHARD UPTON respondents.

MELENCIO-HERRERA, J.:\

In this Petition for certiorari and Prohibition, petitioner Alice Reyes Van Dorn seeks to set aside the
Orders, dated September 15, 1983 and August 3, 1984, in Civil Case No. 1075-P, issued by respondent
Judge, which denied her Motion to Dismiss said case, and her Motion for Reconsideration of the
Dismissal Order, respectively.

The basic background facts are that petitioner is a citizen of the Philippines while private respondent is a
citizen of the United States; that they were married in Hongkong in 1972; that, after the marriage, they
established their residence in the Philippines; that they begot two children born on April 4, 1973 and
December 18, 1975, respectively; that the parties were divorced in Nevada, United States, in 1982; and
that petitioner has re-married also in Nevada, this time to Theodore Van Dorn.

Dated June 8, 1983, private respondent filed suit against petitioner in Civil Case No. 1075-P of the
Regional Trial Court, Branch CXV, in Pasay City, stating that petitioner's business in Ermita, Manila, (the
Galleon Shop, for short), is conjugal property of the parties, and asking that petitioner be ordered to
render an accounting of that business, and that private respondent be declared with right to manage the
conjugal property. Petitioner moved to dismiss the case on the ground that the cause of action is barred by
previous judgment in the divorce proceedings before the Nevada Court wherein respondent had
acknowledged that he and petitioner had "no community property" as of June 11, 1982. The Court below
denied the Motion to Dismiss in the mentioned case on the ground that the property involved is located in
the Philippines so that the Divorce Decree has no bearing in the case. The denial is now the subject of this
certiorari proceeding.

Generally, the denial of a Motion to Dismiss in a civil case is interlocutory and is not subject to appeal.
certiorari and Prohibition are neither the remedies to question the propriety of an interlocutory order of
the trial Court. However, when a grave abuse of discretion was patently committed, or the lower Court
acted capriciously and whimsically, then it devolves upon this Court in a certiorari proceeding to exercise
its supervisory authority and to correct the error committed which, in such a case, is equivalent to lack of
jurisdiction. 1 Prohibition would then lie since it would be useless and a waste of time to go ahead with
the proceedings. 2 Weconsider the petition filed in this case within the exception, and we have given it
due course.

For resolution is the effect of the foreign divorce on the parties and their alleged conjugal property in the
Philippines.

Petitioner contends that respondent is estopped from laying claim on the alleged conjugal property
because of the representation he made in the divorce proceedings before the American Court that they had
no community of property; that the Galleon Shop was not established through conjugal funds, and that
respondent's claim is barred by prior judgment.

For his part, respondent avers that the Divorce Decree issued by the Nevada Court cannot prevail over the
prohibitive laws of the Philippines and its declared national policy; that the acts and declaration of a
foreign Court cannot, especially if the same is contrary to public policy, divest Philippine Courts of
jurisdiction to entertain matters within its jurisdiction.

For the resolution of this case, it is not necessary to determine whether the property relations between
petitioner and private respondent, after their marriage, were upon absolute or relative community
property, upon complete separation of property, or upon any other regime. The pivotal fact in this case is
the Nevada divorce of the parties.

The Nevada District Court, which decreed the divorce, had obtained jurisdiction over petitioner who
appeared in person before the Court during the trial of the case. It also obtained jurisdiction over private
respondent who, giving his address as No. 381 Bush Street, San Francisco, California, authorized his
attorneys in the divorce case, Karp & Gradt Ltd., to agree to the divorce on the ground of incompatibility
in the understanding that there were neither community property nor community obligations. 3 As
explicitly stated in the Power of Attorney he executed in favor of the law firm of KARP & GRAD LTD.,
336 W. Liberty, Reno, Nevada, to represent him in the divorce proceedings:

xxx xxx xxx

You are hereby authorized to accept service of Summons, to file an Answer, appear on
my behalf and do an things necessary and proper to represent me, without further
contesting, subject to the following:

1. That my spouse seeks a divorce on the ground of incompatibility.

2. That there is no community of property to be adjudicated by the Court.

3. 'I'hat there are no community obligations to be adjudicated by the court.

xxx xxx xxx 4

There can be no question as to the validity of that Nevada divorce in any of the States of the United
States. The decree is binding on private respondent as an American citizen. For instance, private
respondent cannot sue petitioner, as her husband, in any State of the Union. What he is contending in this
case is that the divorce is not valid and binding in this jurisdiction, the same being contrary to local law
and public policy.

It is true that owing to the nationality principle embodied in Article 15 of the Civil Code, 5 only Philippine
nationals are covered by the policy against absolute divorces the same being considered contrary to our
concept of public police and morality. However, aliens may obtain divorces abroad, which may be
recognized in the Philippines, provided they are valid according to their national law. 6 In this case, the
divorce in Nevada released private respondent from the marriage from the standards of American law,
under which divorce dissolves the marriage. As stated by the Federal Supreme Court of the United States
in Atherton vs. Atherton, 45 L. Ed. 794, 799:

The purpose and effect of a decree of divorce from the bond of matrimony by a court of
competent jurisdiction are to change the existing status or domestic relation of husband
and wife, and to free them both from the bond. The marriage tie when thus severed as to
one party, ceases to bind either. A husband without a wife, or a wife without a husband,
is unknown to the law. When the law provides, in the nature of a penalty. that the guilty
party shall not marry again, that party, as well as the other, is still absolutely freed from
the bond of the former marriage.

Thus, pursuant to his national law, private respondent is no longer the husband of petitioner. He would
have no standing to sue in the case below as petitioner's husband entitled to exercise control over conjugal
assets. As he is bound by the Decision of his own country's Court, which validly exercised jurisdiction
over him, and whose decision he does not repudiate, he is estopped by his own representation before said
Court from asserting his right over the alleged conjugal property.

To maintain, as private respondent does, that, under our laws, petitioner has to be considered still married
to private respondent and still subject to a wife's obligations under Article 109, et. seq. of the Civil Code
cannot be just. Petitioner should not be obliged to live together with, observe respect and fidelity, and
render support to private respondent. The latter should not continue to be one of her heirs with possible
rights to conjugal property. She should not be discriminated against in her own country if the ends of
justice are to be served.

WHEREFORE, the Petition is granted, and respondent Judge is hereby ordered to dismiss the Complaint
filed in Civil Case No. 1075-P of his Court.

Without costs.

SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 80116 June 30, 1989

IMELDA MANALAYSAY PILAPIL, petitioner,


vs.
HON. CORONA IBAY-SOMERA, in her capacity as Presiding Judge of the Regional Trial Court
of Manila, Branch XXVI; HON. LUIS C. VICTOR, in his capacity as the City Fiscal of Manila; and
ERICH EKKEHARD GEILING, respondents.

REGALADO, J.:

An ill-starred marriage of a Filipina and a foreigner which ended in a foreign absolute divorce, only to be
followed by a criminal infidelity suit of the latter against the former, provides Us the opportunity to lay
down a decisional rule on what hitherto appears to be an unresolved jurisdictional question.

On September 7, 1979, petitioner Imelda Manalaysay Pilapil, a Filipino citizen, and private respondent
Erich Ekkehard Geiling, a German national, were married before the Registrar of Births, Marriages and
Deaths at Friedensweiler in the Federal Republic of Germany. The marriage started auspiciously enough,
and the couple lived together for some time in Malate, Manila where their only child, Isabella Pilapil
Geiling, was born on April 20, 1980. 1

Thereafter, marital discord set in, with mutual recriminations between the spouses, followed by a
separation de facto between them.

After about three and a half years of marriage, such connubial disharmony eventuated in private
respondent initiating a divorce proceeding against petitioner in Germany before the Schoneberg Local
Court in January, 1983. He claimed that there was failure of their marriage and that they had been living
apart since April, 1982. 2
Petitioner, on the other hand, filed an action for legal separation, support and separation of property
before the Regional Trial Court of Manila, Branch XXXII, on January 23, 1983 where the same is still
pending as Civil Case No. 83-15866. 3

On January 15, 1986, Division 20 of the Schoneberg Local Court, Federal Republic of Germany,
promulgated a decree of divorce on the ground of failure of marriage of the spouses. The custody of the
child was granted to petitioner. The records show that under German law said court was locally and
internationally competent for the divorce proceeding and that the dissolution of said marriage was legally
founded on and authorized by the applicable law of that foreign jurisdiction. 4

On June 27, 1986, or more than five months after the issuance of the divorce decree, private respondent
filed two complaints for adultery before the City Fiscal of Manila alleging that, while still married to said
respondent, petitioner "had an affair with a certain William Chia as early as 1982 and with yet another
man named Jesus Chua sometime in 1983". Assistant Fiscal Jacinto A. de los Reyes, Jr., after the
corresponding investigation, recommended the dismissal of the cases on the ground of insufficiency of
evidence. 5 However, upon review, the respondent city fiscal approved a resolution, dated January 8,
1986, directing the filing of two complaints for adultery against the petitioner. 6 The complaints were
accordingly filed and were eventually raffled to two branches of the Regional Trial Court of Manila. The
case entitled "People of the Philippines vs. Imelda Pilapil and William Chia", docketed as Criminal Case
No. 87-52435, was assigned to Branch XXVI presided by the respondent judge; while the other
case, "People of the Philippines vs. Imelda Pilapil and James Chua", docketed as Criminal Case No. 87-
52434 went to the sala of Judge Leonardo Cruz, Branch XXV, of the same court. 7

On March 14, 1987, petitioner filed a petition with the Secretary of Justice asking that the aforesaid
resolution of respondent fiscal be set aside and the cases against her be dismissed. 8 A similar petition was
filed by James Chua, her co-accused in Criminal Case No. 87-52434. The Secretary of Justice, through
the Chief State Prosecutor, gave due course to both petitions and directed the respondent city fiscal to
inform the Department of Justice "if the accused have already been arraigned and if not yet arraigned, to
move to defer further proceedings" and to elevate the entire records of both cases to his office for
review. 9

Petitioner thereafter filed a motion in both criminal cases to defer her arraignment and to suspend further
proceedings thereon. 10 As a consequence, Judge Leonardo Cruz suspended proceedings in Criminal Case
No. 87-52434. On the other hand, respondent judge merely reset the date of the arraignment in Criminal
Case No. 87-52435 to April 6, 1987. Before such scheduled date, petitioner moved for the cancellation of
the arraignment and for the suspension of proceedings in said Criminal Case No. 87-52435 until after the
resolution of the petition for review then pending before the Secretary of Justice. 11 A motion to quash
was also filed in the same case on the ground of lack of jurisdiction, 12 which motion was denied by the
respondent judge in an order dated September 8, 1987. The same order also directed the arraignment of
both accused therein, that is, petitioner and William Chia. The latter entered a plea of not guilty while the
petitioner refused to be arraigned. Such refusal of the petitioner being considered by respondent judge as
direct contempt, she and her counsel were fined and the former was ordered detained until she submitted
herself for arraignment. 13 Later, private respondent entered a plea of not guilty. 14

On October 27, 1987, petitioner filed this special civil action for certiorari and prohibition, with a prayer
for a temporary restraining order, seeking the annulment of the order of the lower court denying her
motion to quash. The petition is anchored on the main ground that the court is without jurisdiction "to try
and decide the charge of adultery, which is a private offense that cannot be prosecuted de officio (sic),
since the purported complainant, a foreigner, does not qualify as an offended spouse having obtained a
final divorce decree under his national law prior to his filing the criminal complaint." 15

On October 21, 1987, this Court issued a temporary restraining order enjoining the respondents from
implementing the aforesaid order of September 8, 1987 and from further proceeding with Criminal Case
No. 87-52435. Subsequently, on March 23, 1988 Secretary of Justice Sedfrey A. Ordoñez acted on the
aforesaid petitions for review and, upholding petitioner's ratiocinations, issued a resolution directing the
respondent city fiscal to move for the dismissal of the complaints against the petitioner. 16

We find this petition meritorious. The writs prayed for shall accordingly issue.

Under Article 344 of the Revised Penal Code, 17 the crime of adultery, as well as four other crimes against
chastity, cannot be prosecuted except upon a sworn written complaint filed by the offended spouse. It has
long since been established, with unwavering consistency, that compliance with this rule is a
jurisdictional, and not merely a formal, requirement. 18 While in point of strict law the jurisdiction of the
court over the offense is vested in it by the Judiciary Law, the requirement for a sworn written complaint
is just as jurisdictional a mandate since it is that complaint which starts the prosecutory proceeding 19 and
without which the court cannot exercise its jurisdiction to try the case.

Now, the law specifically provides that in prosecutions for adultery and concubinage the person who can
legally file the complaint should be the offended spouse, and nobody else. Unlike the offenses of
seduction, abduction, rape and acts of lasciviousness, no provision is made for the prosecution of the
crimes of adultery and concubinage by the parents, grandparents or guardian of the offended party. The
so-called exclusive and successive rule in the prosecution of the first four offenses above mentioned do
not apply to adultery and concubinage. It is significant that while the State, as parens patriae, was added
and vested by the 1985 Rules of Criminal Procedure with the power to initiate the criminal action for a
deceased or incapacitated victim in the aforesaid offenses of seduction, abduction, rape and acts of
lasciviousness, in default of her parents, grandparents or guardian, such amendment did not include the
crimes of adultery and concubinage. In other words, only the offended spouse, and no other, is authorized
by law to initiate the action therefor.

Corollary to such exclusive grant of power to the offended spouse to institute the action, it necessarily
follows that such initiator must have the status, capacity or legal representation to do so at the time of the
filing of the criminal action. This is a familiar and express rule in civil actions; in fact, lack of legal
capacity to sue, as a ground for a motion to dismiss in civil cases, is determined as of the filing of the
complaint or petition.

The absence of an equivalent explicit rule in the prosecution of criminal cases does not mean that the
same requirement and rationale would not apply. Understandably, it may not have been found necessary
since criminal actions are generally and fundamentally commenced by the State, through the People of the
Philippines, the offended party being merely the complaining witness therein. However, in the so-called
"private crimes" or those which cannot be prosecuted de oficio, and the present prosecution for adultery is
of such genre, the offended spouse assumes a more predominant role since the right to commence the
action, or to refrain therefrom, is a matter exclusively within his power and option.

This policy was adopted out of consideration for the aggrieved party who might prefer to suffer the
outrage in silence rather than go through the scandal of a public trial. 20 Hence, as cogently argued by
petitioner, Article 344 of the Revised Penal Code thus presupposes that the marital relationship is still
subsisting at the time of the institution of the criminal action for, adultery. This is a logical consequence
since the raison d'etre of said provision of law would be absent where the supposed offended party had
ceased to be the spouse of the alleged offender at the time of the filing of the criminal case. 21

In these cases, therefore, it is indispensable that the status and capacity of the complainant to commence
the action be definitely established and, as already demonstrated, such status or capacity must indubitably
exist as of the time he initiates the action. It would be absurd if his capacity to bring the action would be
determined by his status before or subsequent to the commencement thereof, where such capacity or
status existed prior to but ceased before, or was acquired subsequent to but did not exist at the time of, the
institution of the case. We would thereby have the anomalous spectacle of a party bringing suit at the very
time when he is without the legal capacity to do so.

To repeat, there does not appear to be any local precedential jurisprudence on the specific issue as to
when precisely the status of a complainant as an offended spouse must exist where a criminal prosecution
can be commenced only by one who in law can be categorized as possessed of such status. Stated
differently and with reference to the present case, the inquiry ;would be whether it is necessary in the
commencement of a criminal action for adultery that the marital bonds between the complainant and the
accused be unsevered and existing at the time of the institution of the action by the former against the
latter.

American jurisprudence, on cases involving statutes in that jurisdiction which are in pari materia with
ours, yields the rule that after a divorce has been decreed, the innocent spouse no longer has the right to
institute proceedings against the offenders where the statute provides that the innocent spouse shall have
the exclusive right to institute a prosecution for adultery. Where, however, proceedings have been
properly commenced, a divorce subsequently granted can have no legal effect on the prosecution of the
criminal proceedings to a conclusion. 22
In the cited Loftus case, the Supreme Court of Iowa held that —

'No prosecution for adultery can be commenced except on the complaint of the husband
or wife.' Section 4932, Code. Though Loftus was husband of defendant when the offense
is said to have been committed, he had ceased to be such when the prosecution was
begun; and appellant insists that his status was not such as to entitle him to make the
complaint. We have repeatedly said that the offense is against the unoffending spouse, as
well as the state, in explaining the reason for this provision in the statute; and we are of
the opinion that the unoffending spouse must be such when the prosecution is
commenced. (Emphasis supplied.)

We see no reason why the same doctrinal rule should not apply in this case and in our jurisdiction,
considering our statutory law and jural policy on the matter. We are convinced that in cases of such
nature, the status of the complainant vis-a-vis the accused must be determined as of the time the
complaint was filed. Thus, the person who initiates the adultery case must be an offended spouse, and by
this is meant that he is still married to the accused spouse, at the time of the filing of the complaint.

In the present case, the fact that private respondent obtained a valid divorce in his country, the Federal
Republic of Germany, is admitted. Said divorce and its legal effects may be recognized in the Philippines
insofar as private respondent is concerned 23 in view of the nationality principle in our civil law on the
matter of status of persons.

Thus, in the recent case of Van Dorn vs. Romillo, Jr., et al., 24 after a divorce was granted by a United
States court between Alice Van Dornja Filipina, and her American husband, the latter filed a civil case in
a trial court here alleging that her business concern was conjugal property and praying that she be ordered
to render an accounting and that the plaintiff be granted the right to manage the business. Rejecting his
pretensions, this Court perspicuously demonstrated the error of such stance, thus:

There can be no question as to the validity of that Nevada divorce in any of the States of
the United States. The decree is binding on private respondent as an American citizen.
For instance, private respondent cannot sue petitioner, as her husband, in any State of the
Union. ...

It is true that owing to the nationality principle embodied in Article 15 of the Civil Code,
only Philippine nationals are covered by the policy against absolute divorces the same
being considered contrary to our concept of public policy and morality. However, aliens
may obtain divorces abroad, which may be recognized in the Philippines, provided they
are valid according to their national law. ...

Thus, pursuant to his national law, private respondent is no longer the husband of
petitioner. He would have no standing to sue in the case below as petitioner's husband
entitled to exercise control over conjugal assets. ... 25

Under the same considerations and rationale, private respondent, being no longer the husband of
petitioner, had no legal standing to commence the adultery case under the imposture that he was the
offended spouse at the time he filed suit.

The allegation of private respondent that he could not have brought this case before the decree of divorce
for lack of knowledge, even if true, is of no legal significance or consequence in this case. When said
respondent initiated the divorce proceeding, he obviously knew that there would no longer be a family nor
marriage vows to protect once a dissolution of the marriage is decreed. Neither would there be a danger of
introducing spurious heirs into the family, which is said to be one of the reasons for the particular
formulation of our law on adultery, 26 since there would thenceforth be no spousal relationship to speak
of. The severance of the marital bond had the effect of dissociating the former spouses from each other,
hence the actuations of one would not affect or cast obloquy on the other.

The aforecited case of United States vs. Mata cannot be successfully relied upon by private respondent. In
applying Article 433 of the old Penal Code, substantially the same as Article 333 of the Revised Penal
Code, which punished adultery "although the marriage be afterwards declared void", the Court merely
stated that "the lawmakers intended to declare adulterous the infidelity of a married woman to her marital
vows, even though it should be made to appear that she is entitled to have her marriage contract declared
null and void, until and unless she actually secures a formal judicial declaration to that effect". Definitely,
it cannot be logically inferred therefrom that the complaint can still be filed after the declaration of nullity
because such declaration that the marriage is void ab initio is equivalent to stating that it never existed.
There being no marriage from the beginning, any complaint for adultery filed after said declaration of
nullity would no longer have a leg to stand on. Moreover, what was consequently contemplated and
within the purview of the decision in said case is the situation where the criminal action for adultery was
filed before the termination of the marriage by a judicial declaration of its nullity ab initio. The same rule
and requisite would necessarily apply where the termination of the marriage was effected, as in this case,
by a valid foreign divorce.

Private respondent's invocation of Donio-Teves, et al. vs. Vamenta, hereinbefore cited, 27 must suffer the
same fate of inapplicability. A cursory reading of said case reveals that the offended spouse therein had
duly and seasonably filed a complaint for adultery, although an issue was raised as to its sufficiency but
which was resolved in favor of the complainant. Said case did not involve a factual situation akin to the
one at bar or any issue determinative of the controversy herein.

WHEREFORE, the questioned order denying petitioner's motion to quash is SET ASIDE and another one
enteredDISMISSING the complaint in Criminal Case No. 87-52435 for lack of jurisdiction. The
temporary restraining order issued in this case on October 21, 1987 is hereby made permanent.

SO ORDERED.

Melencio-Herrera, Padilla and Sarmiento, JJ., concur.

Separate Opinions

PARAS, J., concurring:

It is my considered opinion that regardless of whether We consider the German absolute divorce as valid
also in the Philippines, the fact is that the husband in the instant case, by the very act of his obtaining an
absolute divorce in Germany can no longer be considered as the offended party in case his former wife
actually has carnal knowledge with another, because in divorcing her, he already implicitly authorized the
woman to have sexual relations with others. A contrary ruling would be less than fair for a man, who is
free to have sex will be allowed to deprive the woman of the same privilege.

In the case of Recto v. Harden (100 Phil. 427 [1956]), the Supreme Court considered the absolute divorce
between the American husband and his American wife as valid and binding in the Philippines on the
theory that their status and capacity are governed by their National law, namely, American law. There is
no decision yet of the Supreme Court regarding the validity of such a divorce if one of the parties, say an
American, is married to a Filipino wife, for then two (2) different nationalities would be involved.

In the book of Senate President Jovito Salonga entitled Private International Law and precisely because of
theNational law doctrine, he considers the absolute divorce as valid insofar as the American husband is
concerned but void insofar as the Filipino wife is involved. This results in what he calls a "socially
grotesque situation," where a Filipino woman is still married to a man who is no longer her husband. It is
the opinion however, of the undersigned that very likely the opposite expresses the correct view. While
under the national law of the husband the absolute divorce will be valid, still one of the exceptions to the
application of the proper foreign law (one of the exceptions to comity) is when the foreign law will work
an injustice or injury to the people or residents of the forum. Consequently since to recognize the absolute
divorce as valid on the part of the husband would be injurious or prejudicial to the Filipino wife whose
marriage would be still valid under her national law, it would seem that under our law existing before the
new Family Code (which took effect on August 3, 1988) the divorce should be considered void both with
respect to the American husband and the Filipino wife.
The recent case of Van Dorn v. Romillo, Jr. (139 SCRA [1985]) cannot apply despite the fact that the
husband was an American can with a Filipino wife because in said case the validity of the divorce insofar
as the Filipino wife is concerned was NEVER put in issue.

Separate Opinions

PARAS, J., concurring:

It is my considered opinion that regardless of whether We consider the German absolute divorce as valid
also in the Philippines, the fact is that the husband in the instant case, by the very act of his obtaining an
absolute divorce in Germany can no longer be considered as the offended party in case his former wife
actually has carnal knowledge with another, because in divorcing her, he already implicitly authorized the
woman to have sexual relations with others. A contrary ruling would be less than fair for a man, who is
free to have sex will be allowed to deprive the woman of the same privilege.

In the case of Recto v. Harden (100 Phil. 427 [1956]), the Supreme Court considered the absolute divorce
between the American husband and his American wife as valid and binding in the Philippines on the
theory that their status and capacity are governed by their National law, namely, American law. There is
no decision yet of the Supreme Court regarding the validity of such a divorce if one of the parties, say an
American, is married to a Filipino wife, for then two (2) different nationalities would be involved.

In the book of Senate President Jovito Salonga entitled Private International Law and precisely because of
theNational law doctrine, he considers the absolute divorce as valid insofar as the American husband is
concerned but void insofar as the Filipino wife is involved. This results in what he calls a "socially
grotesque situation," where a Filipino woman is still married to a man who is no longer her husband. It is
the opinion however, of the undersigned that very likely the opposite expresses the correct view. While
under the national law of the husband the absolute divorce will be valid, still one of the exceptions to the
application of the proper foreign law (one of the exceptions to comity) is when the foreign law will work
an injustice or injury to the people or residents of the forum. Consequently since to recognize the absolute
divorce as valid on the part of the husband would be injurious or prejudicial to the Filipino wife whose
marriage would be still valid under her national law, it would seem that under our law existing before the
new Family Code (which took effect on August 3, 1988) the divorce should be considered void both with
respect to the American husband and the Filipino wife.

The recent case of Van Dorn v. Romillo, Jr. (139 SCRA [1985]) cannot apply despite the fact that the
husband was an American can with a Filipino wife because in said case the validity of the divorce insofar
as the Filipino wife is concerned was NEVER put in issue.

THIRD DIVISION

[G.R. No. 138322. October 2, 2001]

GRACE J. GARCIA, a.k.a. GRACE J. GARCIA-RECIO, petitioner, vs. REDERICK A.


RECIO, respondent.

DECISION
PANGANIBAN, J.:

A divorce obtained abroad by an alien may be recognized in our jurisdiction, provided such decree is
valid according to the national law of the foreigner. However, the divorce decree and the governing
personal law of the alien spouse who obtained the divorce must be proven. Our courts do not take judicial
notice of foreign laws and judgments; hence, like any other facts, both the divorce decree and the national
law of the alien must be alleged and proven according to our law on evidence.
The Case

Before us is a Petition for Review under Rule 45 of the Rules of Court, seeking to nullify the January
7, 1999 Decision[1] and the March 24, 1999 Order[2] of the Regional Trial Court of Cabanatuan City,
Branch 28, in Civil Case No. 3026AF. The assailed Decision disposed as follows:

WHEREFORE, this Court declares the marriage between Grace J. Garcia and Rederick A. Recio
solemnized on January 12, 1994 at Cabanatuan City as dissolved and both parties can now remarry under
existing and applicable laws to any and/or both parties.[3]

The assailed Order denied reconsideration of the above-quoted Decision.

The Facts

Rederick A. Recio, a Filipino, was married to Editha Samson, an Australian citizen, in Malabon,
Rizal, on March 1, 1987.[4] They lived together as husband and wife in Australia. On May 18, 1989, [5] a
decree of divorce, purportedly dissolving the marriage, was issued by an Australian family court.
On June 26, 1992, respondent became an Australian citizen, as shown by a Certificate of Australian
Citizenship issued by the Australian government.[6] Petitioner -- a Filipina -- and respondent were married
on January 12, 1994 in Our Lady of Perpetual Help Church in Cabanatuan City.[7] In their application for
a marriage license, respondent was declared as single and Filipino.[8]
Starting October 22, 1995, petitioner and respondent lived separately without prior judicial
dissolution of their marriage. While the two were still in Australia, their conjugal assets were divided on
May 16, 1996, in accordance with their Statutory Declarations secured in Australia.[9]
On March 3, 1998, petitioner filed a Complaint for Declaration of Nullity of Marriage [10] in the
court a quo, on the ground of bigamy -- respondent allegedly had a prior subsisting marriage at the time
he married her on January 12, 1994. She claimed that she learned of respondents marriage to Editha
Samson only in November, 1997.
In his Answer, respondent averred that, as far back as 1993, he had revealed to petitioner his prior
marriage and its subsequent dissolution.[11] He contended that his first marriage to an Australian citizen
had been validly dissolved by a divorce decree obtained in Australia in 1989; [12] thus, he was legally
capacitated to marry petitioner in 1994.
On July 7, 1998 -- or about five years after the couples wedding and while the suit for the declaration
of nullity was pending -- respondent was able to secure a divorce decree from a family court in Sydney,
Australia because the marriage ha[d] irretrievably broken down.[13]
Respondent prayed in his Answer that the Complaint be dismissed on the ground that it stated no
cause of action.[14] The Office of the Solicitor General agreed with respondent.[15] The court marked and
admitted the documentary evidence of both parties.[16] After they submitted their respective memoranda,
the case was submitted for resolution.[17]
Thereafter, the trial court rendered the assailed Decision and Order.

Ruling of the Trial Court

The trial court declared the marriage dissolved on the ground that the divorce issued in Australia was
valid and recognized in the Philippines. It deemed the marriage ended, but not on the basis of any defect
in an essential element of the marriage; that is, respondents alleged lack of legal capacity to
remarry. Rather, it based its Decision on the divorce decree obtained by respondent. The Australian
divorce had ended the marriage; thus, there was no more marital union to nullify or annul.
Hence, this Petition.[18]

Issues
Petitioner submits the following issues for our consideration:
1

The trial court gravely erred in finding that the divorce decree obtained in Australia by the
respondent ipso facto terminated his first marriage to Editha Samson thereby capacitating him to contract
a second marriage with the petitioner.

The failure of the respondent, who is now a naturalized Australian, to present a certificate of legal
capacity to marry constitutes absence of a substantial requisite voiding the petitioners marriage to the
respondent

The trial court seriously erred in the application of Art. 26 of the Family Code in this case.

The trial court patently and grievously erred in disregarding Arts. 11, 13, 21, 35, 40, 52 and 53 of the
Family Code as the applicable provisions in this case.

The trial court gravely erred in pronouncing that the divorce decree obtained by the respondent in
Australia ipso facto capacitated the parties to remarry, without first securing a recognition of the judgment
granting the divorce decree before our courts.[19]

The Petition raises five issues, but for purposes of this Decision, we shall concentrate on two pivotal
ones: (1) whether the divorce between respondent and Editha Samson was proven, and (2) whether
respondent was proven to be legally capacitated to marry petitioner. Because of our ruling on these two,
there is no more necessity to take up the rest.

The Courts Ruling

The Petition is partly meritorious.

First Issue:
Proving the Divorce Between Respondent and Editha Samson

Petitioner assails the trial courts recognition of the divorce between respondent and Editha
Samson. Citing Adong v. Cheong Seng Gee,[20] petitioner argues that the divorce decree, like any other
foreign judgment, may be given recognition in this jurisdiction only upon proof of the existence of (1) the
foreign law allowing absolute divorce and (2) the alleged divorce decree itself. She adds that respondent
miserably failed to establish these elements.
Petitioner adds that, based on the first paragraph of Article 26 of the Family Code, marriages
solemnized abroad are governed by the law of the place where they were celebrated (the lex loci
celebrationis). In effect, the Code requires the presentation of the foreign law to show the conformity of
the marriage in question to the legal requirements of the place where the marriage was performed.
At the outset, we lay the following basic legal principles as the take-off points for our
discussion. Philippine law does not provide for absolute divorce; hence, our courts cannot grant it. [21] A
marriage between two Filipinos cannot be dissolved even by a divorce obtained abroad, because of
Articles 15[22] and 17[23] of the Civil Code.[24] In mixed marriages involving a Filipino and a foreigner,
Article 26[25]of the Family Code allows the former to contract a subsequent marriage in case the divorce is
validly obtained abroad by the alien spouse capacitating him or her to remarry.[26] A divorce obtained
abroad by a couple, who are both aliens, may be recognized in the Philippines, provided it is consistent
with their respective national laws.[27]
A comparison between marriage and divorce, as far as pleading and proof are concerned, can be
made. Van Dorn v. Romillo Jr. decrees that aliens may obtain divorces abroad, which may be recognized
in the Philippines, provided they are valid according to their national law.[28] Therefore, before a foreign
divorce decree can be recognized by our courts, the party pleading it must prove the divorce as a fact and
demonstrate its conformity to the foreign law allowing it.[29] Presentation solely of the divorce decree is
insufficient.
Divorce as a Question of Fact
Petitioner insists that before a divorce decree can be admitted in evidence, it must first comply with
the registration requirements under Articles 11, 13 and 52 of the Family Code. These articles read as
follows:

ART. 11. Where a marriage license is required, each of the contracting parties shall file separately a
sworn application for such license with the proper local civil registrar which shall specify the following:

xxxxxxxxx

(5) If previously married, how, when and where the previous marriage was dissolved or annulled;

xxxxxxxxx

ART. 13. In case either of the contracting parties has been previously married, the applicant shall be
required to

ART. 13. In case either of the contracting parties has been previously married, the applicant shall be
required to furnish, instead of the birth or baptismal certificate required in the last preceding article, the
death certificate of the deceased spouse or the judicial decree of the absolute divorce, or the judicial
decree of annulment or declaration of nullity of his or her previous marriage. x x x.

ART. 52. The judgment of annulment or of absolute nullity of the marriage, the partition and distribution
of the properties of the spouses, and the delivery of the childrens presumptive legitimes shall be recorded
in the appropriate civil registry and registries of property; otherwise, the same shall not affect their
persons.

Respondent, on the other hand, argues that the Australian divorce decree is a public document -- a
written official act of an Australian family court. Therefore, it requires no further proof of its authenticity
and due execution.
Respondent is getting ahead of himself. Before a foreign judgment is given presumptive evidentiary
value, the document must first be presented and admitted in evidence.[30] A divorce obtained abroad is
proven by the divorce decree itself. Indeed the best evidence of a judgment is the judgment itself.[31] The
decree purports to be a written act or record of an act of an official body or tribunal of a foreign
country.[32]
Under Sections 24 and 25 of Rule 132, on the other hand, a writing or document may be proven as a
public or official record of a foreign country by either (1) an official publication or (2) a copy thereof
attested[33] by the officer having legal custody of the document. If the record is not kept in the Philippines,
such copy must be (a) accompanied by a certificate issued by the proper diplomatic or consular officer in
the Philippine foreign service stationed in the foreign country in which the record is kept and (b)
authenticated by the seal of his office. [34]
The divorce decree between respondent and Editha Samson appears to be an authentic one issued by
an Australian family court.[35] However, appearance is not sufficient; compliance with the aforementioned
rules on evidence must be demonstrated.
Fortunately for respondents cause, when the divorce decree of May 18, 1989 was submitted in
evidence, counsel for petitioner objected, not to its admissibility, but only to the fact that it had not been
registered in the Local Civil Registry of Cabanatuan City.[36] The trial court ruled that it was admissible,
subject to petitioners qualification.[37] Hence, it was admitted in evidence and accorded weight by the
judge. Indeed, petitioners failure to object properly rendered the divorce decree admissible as a written act
of the Family Court of Sydney, Australia.[38]
Compliance with the quoted articles (11, 13 and 52) of the Family Code is not necessary; respondent
was no longer bound by Philippine personal laws after he acquired Australian citizenship in
1992.[39]Naturalization is the legal act of adopting an alien and clothing him with the political and civil
rights belonging to a citizen.[40] Naturalized citizens, freed from the protective cloak of their former states,
don the attires of their adoptive countries. By becoming an Australian, respondent severed his allegiance
to the Philippines and the vinculum juris that had tied him to Philippine personal laws.
Burden of Proving Australian Law
Respondent contends that the burden to prove Australian divorce law falls upon petitioner, because
she is the party challenging the validity of a foreign judgment. He contends that petitioner was satisfied
with the original of the divorce decree and was cognizant of the marital laws of Australia, because she
had lived and worked in that country for quite a long time. Besides, the Australian divorce law is
allegedly known by Philippine courts; thus, judges may take judicial notice of foreign laws in the exercise
of sound discretion.
We are not persuaded. The burden of proof lies with the party who alleges the existence of a fact or
thing necessary in the prosecution or defense of an action.[41] In civil cases, plaintiffs have the burden of
proving the material allegations of the complaint when those are denied by the answer; and defendants
have the burden of proving the material allegations in their answer when they introduce new
matters.[42] Since the divorce was a defense raised by respondent, the burden of proving the pertinent
Australian law validating it falls squarely upon him.
It is well-settled in our jurisdiction that our courts cannot take judicial notice of foreign laws.[43] Like
any other facts, they must be alleged and proved. Australian marital laws are not among those matters that
judges are supposed to know by reason of their judicial function.[44] The power of judicial notice must be
exercised with caution, and every reasonable doubt upon the subject should be resolved in the negative.

Second Issue: Respondents Legal Capacity to Remarry

Petitioner contends that, in view of the insufficient proof of the divorce, respondent was legally
incapacitated to marry her in 1994. Hence, she concludes that their marriage was void ab initio.
Respondent replies that the Australian divorce decree, which was validly admitted in evidence,
adequately established his legal capacity to marry under Australian law.
Respondents contention is untenable. In its strict legal sense, divorce means the legal dissolution of a
lawful union for a cause arising after marriage. But divorces are of different types. The two basic ones are
(1) absolute divorce or a vinculo matrimonii and (2) limited divorce or a mensa et thoro. The first kind
terminates the marriage, while the second suspends it and leaves the bond in full force. [45] There is no
showing in the case at bar which type of divorce was procured by respondent.
Respondent presented a decree nisi or an interlocutory decree -- a conditional or provisional
judgment of divorce. It is in effect the same as a separation from bed and board, although an absolute
divorce may follow after the lapse of the prescribed period during which no reconciliation is effected.[46]
Even after the divorce becomes absolute, the court may under some foreign statutes and practices,
still restrict remarriage. Under some other jurisdictions, remarriage may be limited by statute; thus, the
guilty party in a divorce which was granted on the ground of adultery may be prohibited from marrying
again. The court may allow a remarriage only after proof of good behavior.[47]
On its face, the herein Australian divorce decree contains a restriction that reads:
1. A party to a marriage who marries again before this decree becomes absolute (unless the
other party has died) commits the offence of bigamy.[48]
This quotation bolsters our contention that the divorce obtained by respondent may have been
restricted. It did not absolutely establish his legal capacity to remarry according to his national
law. Hence, we find no basis for the ruling of the trial court, which erroneously assumed that the
Australian divorce ipso facto restored respondents capacity to remarry despite the paucity of evidence on
this matter.
We also reject the claim of respondent that the divorce decree raises a disputable presumption or
presumptive evidence as to his civil status based on Section 48, Rule 39 [49] of the Rules of Court, for the
simple reason that no proof has been presented on the legal effects of the divorce decree obtained under
Australian laws.
Significance of the Certificate of Legal Capacity
Petitioner argues that the certificate of legal capacity required by Article 21 of the Family Code was
not submitted together with the application for a marriage license. According to her, its absence is proof
that respondent did not have legal capacity to remarry.
We clarify. To repeat, the legal capacity to contract marriage is determined by the national law of the
party concerned. The certificate mentioned in Article 21 of the Family Code would have been sufficient
to establish the legal capacity of respondent, had he duly presented it in court. A duly authenticated and
admitted certificate is prima facie evidence of legal capacity to marry on the part of the alien applicant for
a marriage license.[50]
As it is, however, there is absolutely no evidence that proves respondents legal capacity to marry
petitioner. A review of the records before this Court shows that only the following exhibits were
presented before the lower court: (1) for petitioner: (a) Exhibit A Complaint; [51] (b) Exhibit B Certificate
of Marriage Between Rederick A. Recio (Filipino-Australian) and Grace J. Garcia (Filipino) on January
12, 1994 in Cabanatuan City, Nueva Ecija;[52] (c) Exhibit C Certificate of Marriage Between Rederick A.
Recio (Filipino) and Editha D. Samson (Australian) on March 1, 1987 in Malabon, Metro Manila; [53] (d)
Exhibit D Office of the City Registrar of Cabanatuan City Certification that no information of annulment
between Rederick A. Recio and Editha D. Samson was in its records;[54] and (e) Exhibit E Certificate of
Australian Citizenship of Rederick A. Recio;[55] (2) for respondent: (a) Exhibit 1 -- Amended
Answer;[56] (b) Exhibit 2 Family Law Act 1975 Decree Nisi of Dissolution of Marriage in the Family
Court of Australia;[57] (c) Exhibit 3 Certificate of Australian Citizenship of Rederick A. Recio; [58] (d)
Exhibit 4 Decree Nisi of Dissolution of Marriage in the Family Court of Australia Certificate; [59] and
Exhibit 5 -- Statutory Declaration of the Legal Separation Between Rederick A. Recio and Grace J.
Garcia Recio since October 22, 1995.[60]
Based on the above records, we cannot conclude that respondent, who was then a naturalized
Australian citizen, was legally capacitated to marry petitioner on January 12, 1994. We agree with
petitioners contention that the court a quo erred in finding that the divorce decree ipso facto clothed
respondent with the legal capacity to remarry without requiring him to adduce sufficient evidence to show
the Australian personal law governing his status; or at the very least, to prove his legal capacity to
contract the second marriage.
Neither can we grant petitioners prayer to declare her marriage to respondent null and void on the
ground of bigamy. After all, it may turn out that under Australian law, he was really capacitated to marry
petitioner as a direct result of the divorce decree. Hence, we believe that the most judicious course is to
remand this case to the trial court to receive evidence, if any, which show petitioners legal capacity to
marry petitioner. Failing in that, then the court a quo may declare a nullity of the parties marriage on the
ground of bigamy, there being already in evidence two existing marriage certificates, which were both
obtained in the Philippines, one in Malabon, Metro Manila dated March 1, 1987 and the other, in
Cabanatuan City dated January 12, 1994.
WHEREFORE, in the interest of orderly procedure and substantial justice, we REMAND the case to
the court a quo for the purpose of receiving evidence which conclusively show respondents legal capacity
to marry petitioner; and failing in that, of declaring the parties marriage void on the ground of bigamy, as
above discussed. No costs.
SO ORDERED.
SECOND DIVISION

[G.R. No. 124862. December 22, 1998]

FE D. QUITA, petitioner, vs. COURT OF APPEALS and BLANDINA DANDAN,* respondents.

DECISION
BELLOSILLO, J .:

FE D. QUITA and Arturo T. Padlan, both Filipinos, were married in the Philippines on 18 May
1941. They were not however blessed with children. Somewhere along the way their relationship
soured.Eventually Fe sued Arturo for divorce in San Francisco, California, U.S.A. She submitted in the
divorce proceedings a private writing dated 19 July 1950 evidencing their agreement to live separately
from each other and a settlement of their conjugal properties. On 23 July 1954 she obtained a final
judgment of divorce. Three (3) weeks thereafter she married a certain Felix Tupaz in the same locality but
their relationship also ended in a divorce. Still in the U.S.A., she married for the third time, to a certain
Wernimont.
On 16 April 1972 Arturo died. He left no will. On 31 August 1972 Lino Javier Inciong filed a
petition with the Regional Trial Court of Quezon City for issuance of letters of administration concerning
the estate of Arturo in favor of the Philippine Trust Company. Respondent Blandina Dandan (also
referred to as Blandina Padlan), claiming to be the surviving spouse of Arturo Padlan, and Claro, Alexis,
Ricardo, Emmanuel, Zenaida and Yolanda, all surnamed Padlan, named in the petition as surviving
children of Arturo Padlan, opposed the petition and prayed for the appointment instead of Atty. Leonardo
Cabasal, which was resolved in favor of the latter. Upon motion of the oppositors themselves, Atty.
Cabasal was later replaced by Higino Castillon. On 30 April 1973 the oppositors (Blandina and the
Padlan children) submitted certified photocopies of the 19 July 1950 private writing and the final
judgment of divorce between petitioner and Arturo. Later Ruperto T. Padlan, claiming to be the sole
surviving brother of the deceased Arturo, intervened.
On 7 October 1987 petitioner moved for the immediate declaration of heirs of the decedent and the
distribution of his estate. At the scheduled hearing on 23 October 1987, private respondent as well as the
six (6) Padlan children and Ruperto failed to appear despite due notice. On the same day, the trial court
required the submission of the records of birth of the Padlan children within ten (10) days from receipt
thereof, after which, with or without the documents, the issue on the declaration of heirs would be
considered submitted for resolution. The prescribed period lapsed without the required documents being
submitted.
The trial court invoking Tenchavez v. Escao[1] which held that "a foreign divorce between Filipino
citizens sought and decreed after the effectivity of the present Civil Code (Rep. Act 386) was not entitled
to recognition as valid in this jurisdiction,"[2] disregarded the divorce between petitioner and
Arturo. Consequently, it expressed the view that their marriage subsisted until the death of Arturo in
1972.Neither did it consider valid their extrajudicial settlement of conjugal properties due to lack of
judicial approval.[3] On the other hand, it opined that there was no showing that marriage existed between
private respondent and Arturo, much less was it shown that the alleged Padlan children had been
acknowledged by the deceased as his children with her. As regards Ruperto, it found that he was a brother
of Arturo.On 27 November 1987[4] only petitioner and Ruperto were declared the intestate heirs of
Arturo. Accordingly, equal adjudication of the net hereditary estate was ordered in favor of the two
intestate heirs.[5]
On motion for reconsideration, Blandina and the Padlan children were allowed to present proofs that
the recognition of the children by the deceased as his legitimate children, except Alexis who was
recognized as his illegitimate child, had been made in their respective records of birth. Thus on 15
February 1988[6] partial reconsideration was granted declaring the Padlan children, with the exception of
Alexis, entitled to one-half of the estate to the exclusion of Ruperto Padlan, and petitioner to the other
half.[7] Private respondent was not declared an heir. Although it was stated in the aforementioned records
of birth that she and Arturo were married on 22 April 1947, their marriage was clearly void since it was
celebrated during the existence of his previous marriage to petitioner.
In their appeal to the Court of Appeals, Blandina and her children assigned as one of the errors
allegedly committed by the trial court the circumstance that the case was decided without a hearing, in
violation of Sec. 1, Rule 90, of the Rules of Court, which provides that if there is a controversy before the
court as to who are the lawful heirs of the deceased person or as to the distributive shares to which each
person is entitled under the law, the controversy shall be heard and decided as in ordinary cases.
Respondent appellate court found this ground alone sufficient to sustain the appeal; hence, on 11
September 1995 it declared null and void the 27 November 1987 decision and 15 February 1988 order of
the trial court, and directed the remand of the case to the trial court for further proceedings. [8] On 18 April
1996 it denied reconsideration.[9]
Should this case be remanded to the lower court for further proceedings? Petitioner insists that there
is no need because, first, no legal or factual issue obtains for resolution either as to the heirship of the
Padlan children or as to their respective shares in the intestate estate of the decedent; and, second, the
issue as to who between petitioner and private respondent is the proper heir of the decedent is one of law
which can be resolved in the present petition based on established facts and admissions of the parties.
We cannot sustain petitioner. The provision relied upon by respondent court is clear: If there is
a controversy before the court as to who are the lawful heirs of the deceased person or as to the
distributive shares to which each person is entitled under the law, the controversy shall be heard and
decided as in ordinary cases.
We agree with petitioner that no dispute exists either as to the right of the six (6) Padlan children to
inherit from the decedent because there are proofs that they have been duly acknowledged by him and
petitioner herself even recognizes them as heirs of Arturo Padlan;[10] nor as to their respective hereditary
shares. But controversy remains as to who is the legitimate surviving spouse of Arturo. The trial court,
after the parties other than petitioner failed to appear during the scheduled hearing on 23 October 1987 of
the motion for immediate declaration of heirs and distribution of estate, simply issued an order requiring
the submission of the records of birth of the Padlan children within ten (10) days from receipt thereof,
after which, with or without the documents, the issue on declaration of heirs would be deemed submitted
for resolution.
We note that in her comment to petitioner's motion private respondent raised, among others, the
issue as to whether petitioner was still entitled to inherit from the decedent considering that she had
secured a divorce in the U.S.A. and in fact had twice remarried. She also invoked the above quoted
procedural rule.[11] To this, petitioner replied that Arturo was a Filipino and as such remained legally
married to her in spite of the divorce they obtained.[12] Reading between the lines, the implication is that
petitioner was no longer a Filipino citizen at the time of her divorce from Arturo. This should have
prompted the trial court to conduct a hearing to establish her citizenship. The purpose of a hearing is to
ascertain the truth of the matters in issue with the aid of documentary and testimonial evidence as well as
the arguments of the parties either supporting or opposing the evidence. Instead, the lower court
perfunctorily settled her claim in her favor by merely applying the ruling in Tenchavez v. Escao.
Then in private respondent's motion to set aside and/or reconsider the lower court's decision she
stressed that the citizenship of petitioner was relevant in the light of the ruling in Van Dorn v. Romillo
Jr.[13] that aliens may obtain divorces abroad, which may be recognized in the Philippines, provided they
are valid according to their national law. She prayed therefore that the case be set for
hearing.[14]Petitioner opposed the motion but failed to squarely address the issue on her citizenship.[15] The
trial court did not grant private respondent's prayer for a hearing but proceeded to resolve her motion with
the finding that both petitioner and Arturo were "Filipino citizens and were married in the
Philippines."[16] It maintained that their divorce obtained in 1954 in San Francisco, California, U.S.A.,
was not valid in Philippine jurisdiction. We deduce that the finding on their
citizenship pertained solely to the time of their marriage as the trial court was not supplied with a basis to
determine petitioner's citizenship at the time of their divorce. The doubt persisted as to whether she was
still a Filipino citizen when their divorce was decreed. The trial court must have overlooked the
materiality of this aspect. Once proved that she was no longer a Filipino citizen at the time of their
divorce, Van Dorn would become applicable and petitioner could very well lose her right to inherit from
Arturo.
Respondent again raised in her appeal the issue on petitioner's citizenship;[17] it did not merit
enlightenment however from petitioner.[18] In the present proceeding, petitioner's citizenship is brought
anew to the fore by private respondent. She even furnishes the Court with the transcript of stenographic
notes taken on 5 May 1995 during the hearing for the reconstitution of the original of a certain transfer
certificate title as well as the issuance of new owner's duplicate copy thereof before another trial
court. When asked whether she was an American citizen petitioner answered that she was since
1954.[19]Significantly, the decree of divorce of petitioner and Arturo was obtained in the same
year. Petitioner however did not bother to file a reply memorandum to erase the uncertainty about her
citizenship at the time of their divorce, a factual issue requiring hearings to be conducted by the trial
court. Consequently, respondent appellate court did not err in ordering the case returned to the trial court
for further proceedings.
We emphasize however that the question to be determined by the trial court should be limited only to
the right of petitioner to inherit from Arturo as his surviving spouse. Private respondent's claim to heirship
was already resolved by the trial court. She and Arturo were married on 22 April 1947 while the prior
marriage of petitioner and Arturo was subsisting thereby resulting in a bigamous marriage considered
void from the beginning under Arts. 80 and 83 of the Civil Code. Consequently, she is not a surviving
spouse that can inherit from him as this status presupposes a legitimate relationship.[20]
As regards the motion of private respondent for petitioner and her counsel to be declared in contempt
of court and that the present petition be dismissed for forum shopping,[21] the same lacks merit. For forum
shopping to exist the actions must involve the same transactions and same essential facts and
circumstances. There must also be identical causes of action, subject matter and issue. [22] The present
petition deals with declaration of heirship while the subsequent petitions filed before the three (3) trial
courts concern the issuance of new owner's duplicate copies of titles of certain properties belonging to the
estate of Arturo. Obviously, there is no reason to declare the existence of forum shopping.
WHEREFORE, the petition is DENIED. The decision of respondent Court of Appeals ordering the
remand of the case to the court of origin for further proceedings and declaring null and void its decision
holding petitioner Fe D. Quita and Ruperto T. Padlan as intestate heirs is AFFIRMED. The order of the
appellate court modifying its previous decision by granting one-half (1/2) of the net hereditary estate to
the Padlan children, namely, Claro, Ricardo, Emmanuel, Zenaida and Yolanda, with the exception of
Alexis, all surnamed Padlan, instead of Arturo's brother Ruperto Padlan, is likewise AFFIRMED.The
Court however emphasizes that the reception of evidence by the trial court should be limited to the
hereditary rights of petitioner as the surviving spouse of Arturo Padlan.
The motion to declare petitioner and her counsel in contempt of court and to dismiss the present
petition for forum shopping is DENIED.
SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 162580 January 27, 2006

ELMAR O. PEREZ, Petitioner,


vs.
COURT OF APPEALS, Fifth Division, TRISTAN A. CATINDIG and LILY GOMEZ-
CATINDIG, Respondents.

DECISION

YNARES-SANTIAGO, J.:

This petition for certiorari and prohibition under Rule 65 of the Rules of Court assails the July 25, 2003
Decision1of the Court of Appeals in CA-G.R. SP No. 74456 which set aside and declared as null and void
the September 30, 2002 Order2 of the Regional Trial Court of Quezon City, Branch 84, granting
petitioner’s motion for leave to file intervention and admitting the Complaint-in-Intervention3 in Civil
Case No. Q-01-44847; and its January 23, 2004 Resolution4 denying the motion for reconsideration.

Private respondent Tristan A. Catindig married Lily Gomez Catindig5 twice on May 16, 1968. The first
marriage ceremony was celebrated at the Central Methodist Church at T.M. Kalaw Street, Ermita, Manila
while the second took place at the Lourdes Catholic Church in La Loma, Quezon City. The marriage
produced four children.

Several years later, the couple encountered marital problems that they decided to separate from each
other. Upon advice of a mutual friend, they decided to obtain a divorce from the Dominican Republic.
Thus, on April 27, 1984, Tristan and Lily executed a Special Power of Attorney addressed to the Judge of
the First Civil Court of San Cristobal, Dominican Republic, appointing an attorney-in-fact to institute a
divorce action under its laws.6

Thereafter, on April 30, 1984, the private respondents filed a joint petition for dissolution of conjugal
partnership with the Regional Trial Court of Makati. On June 12, 1984, the civil court in the Dominican
Republic ratified the divorce by mutual consent of Tristan and Lily. Subsequently, on June 23, 1984, the
Regional Trial Court of Makati City, Branch 133, ordered the complete separation of properties between
Tristan and Lily.
On July 14, 1984, Tristan married petitioner Elmar O. Perez in the State of Virginia in the United
States7 and both lived as husband and wife until October 2001. Their union produced one offspring.8

During their cohabitation, petitioner learned that the divorce decree issued by the court in the Dominican
Republic which "dissolved" the marriage between Tristan and Lily was not recognized in the Philippines
and that her marriage to Tristan was deemed void under Philippine law. When she confronted Tristan
about this, the latter assured her that he would legalize their union after he obtains an annulment of his
marriage with Lily. Tristan further promised the petitioner that he would adopt their son so that he would
be entitled to an equal share in his estate as that of each of his children with Lily.9

On August 13, 2001, Tristan filed a petition for the declaration of nullity of his marriage to Lily with the
Regional Trial Court of Quezon City, docketed as Case No. Q-01-44847.

Subsequently, petitioner filed a Motion for Leave to File Intervention10 claiming that she has a legal
interest in the matter in litigation because she knows certain information which might aid the trial court at
a truthful, fair and just adjudication of the annulment case, which the trial court granted on September 30,
2002. Petitioner’s complaint-in-intervention was also ordered admitted.

Tristan filed a petition for certiorari and prohibition with the Court of Appeals seeking to annul the order
dated September 30, 2002 of the trial court. The Court of Appeals granted the petition and declared as
null and void the September 30, 2002 Order of the trial court granting the motion for leave to file
intervention and admitting the complaint-in-intervention.

Petitioner’s motion for reconsideration was denied, hence this petition for certiorari and prohibition filed
under Rule 65 of the Rules of Court. Petitioner contends that the Court of Appeals gravely abused its
discretion in disregarding her legal interest in the annulment case between Tristan and Lily.

The petition lacks merit.

Ordinarily, the proper recourse of an aggrieved party from a decision of the Court of Appeals is a petition
for review on certiorari under Rule 45 of the Rules of Court. However, if the error subject of the recourse
is one of jurisdiction, or the act complained of was granted by a court with grave abuse of discretion
amounting to lack or excess of jurisdiction, as alleged in this case, the proper remedy is a petition for
certiorari under Rule 65 of the said Rules.11 This is based on the premise that in issuing the assailed
decision and resolution, the Court of Appeals acted with grave abuse of discretion, amounting to excess of
lack of jurisdiction and there is no plain, speedy and adequate remedy in the ordinary course of law. A
remedy is considered plain, speedy, and adequate if it will promptly relieve the petitioner from the
injurious effect of the judgment and the acts of the lower court.12

It is therefore incumbent upon the petitioner to establish that the Court of Appeals acted with grave abuse
of discretion amounting to excess or lack of jurisdiction when it promulgated the assailed decision and
resolution.

We have previously ruled that grave abuse of discretion may arise when a lower court or tribunal violates
or contravenes the Constitution, the law or existing jurisprudence. By grave abuse of discretion is meant,
such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction. The abuse of
discretion must be grave as where the power is exercised in an arbitrary or despotic manner by reason of
passion or personal hostility and must be so patent and gross as to amount to an evasion of positive duty
or to a virtual refusal to perform the duty enjoined by or to act at all in contemplation of law.13 The word
"capricious," usually used in tandem with the term "arbitrary," conveys the notion of willful and
unreasoning action. Thus, when seeking the corrective hand of certiorari, a clear showing of caprice and
arbitrariness in the exercise of discretion is imperative.14

The Rules of Court laid down the parameters before a person, not a party to a case can intervene, thus:

Who may intervene. — A person who has a legal interest in the matter in litigation, or in the success of
either of the parties, or an interest against both, or is so situated as to be adversely affected by a
distribution or other disposition of property in the custody of the court or of an officer thereof may, with
leave of court, be allowed to intervene in the action. The court shall consider whether or not the
intervention will unduly delay or prejudice the adjudication of the rights of the original parties, and
whether or not the intervenor’s rights may be fully protected in a separate proceeding.15
The requirements for intervention are: [a] legal interest in the matter in litigation; and [b] consideration
must be given as to whether the adjudication of the original parties may be delayed or prejudiced, or
whether the intervenor’s rights may be protected in a separate proceeding or not.16

Legal interest, which entitles a person to intervene, must be in the matter in litigation and of such direct
and immediate character that the intervenor will either gain or lose by direct legal operation and effect of
the judgment.17 Such interest must be actual, direct and material, and not simply contingent and
expectant.18

Petitioner claims that her status as the wife and companion of Tristan for 17 years vests her with the
requisite legal interest required of a would-be intervenor under the Rules of Court.

Petitioner’s claim lacks merit. Under the law, petitioner was never the legal wife of Tristan, hence her
claim of legal interest has no basis.

When petitioner and Tristan married on July 14, 1984, Tristan was still lawfully married to Lily. The
divorce decree that Tristan and Lily obtained from the Dominican Republic never dissolved the marriage
bond between them. It is basic that laws relating to family rights and duties, or to the status, condition and
legal capacity of persons are binding upon citizens of the Philippines, even though living
abroad.19 Regardless of where a citizen of the Philippines might be, he or she will be governed by
Philippine laws with respect to his or her family rights and duties, or to his or her status, condition and
legal capacity. Hence, if a Filipino regardless of whether he or she was married here or abroad, initiates a
petition abroad to obtain an absolute divorce from spouse and eventually becomes successful in getting an
absolute divorce decree, the Philippines will not recognize such absolute divorce.20

When Tristan and Lily married on May 18, 1968, their marriage was governed by the provisions of the
Civil Code21 which took effect on August 30, 1950. In the case of Tenchavez v. Escano22 we held:

(1) That a foreign divorce between Filipino citizens, sought and decreed after the effectivity of the present
Civil Code (Rep. Act No. 386), is not entitled to recognition as valid in this jurisdiction; and neither is the
marriage contracted with another party by the divorced consort, subsequently to the foreign decree of
divorce, entitled to validity in the country. (Emphasis added)

Thus, petitioner’s claim that she is the wife of Tristan even if their marriage was celebrated abroad lacks
merit. Thus, petitioner never acquired the legal interest as a wife upon which her motion for intervention
is based.

Since petitioner’s motion for leave to file intervention was bereft of the indispensable requirement of
legal interest, the issuance by the trial court of the order granting the same and admitting the complaint-
in-intervention was attended with grave abuse of discretion. Consequently, the Court of Appeals correctly
set aside and declared as null and void the said order.

WHEREFORE, the petition is DISMISSED. The assailed Decision dated July 25, 2003 and Resolution
dated January 23, 2004 of the Court of Appeals in CA-G.R. SP No. 74456 are AFFIRMED.

No pronouncement as to costs.

SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 133743 February 6, 2007

EDGAR SAN LUIS, Petitioner,


vs.
FELICIDAD SAN LUIS, Respondent.
x ---------------------------------------------------- x

G.R. No. 134029 February 6, 2007

RODOLFO SAN LUIS, Petitioner,


vs.
FELICIDAD SAGALONGOS alias FELICIDAD SAN LUIS, Respondent.

DECISION

YNARES-SANTIAGO, J.:

Before us are consolidated petitions for review assailing the February 4, 1998 Decision 1 of the Court of
Appeals in CA-G.R. CV No. 52647, which reversed and set aside the September 12, 1995 2 and January
31, 1996 3Resolutions of the Regional Trial Court of Makati City, Branch 134 in SP. Proc. No. M-3708;
and its May 15, 1998 Resolution 4 denying petitioners’ motion for reconsideration.

The instant case involves the settlement of the estate of Felicisimo T. San Luis (Felicisimo), who was the
former governor of the Province of Laguna. During his lifetime, Felicisimo contracted three marriages.
His first marriage was with Virginia Sulit on March 17, 1942 out of which were born six children,
namely: Rodolfo, Mila, Edgar, Linda, Emilita and Manuel. On August 11, 1963, Virginia predeceased
Felicisimo.

Five years later, on May 1, 1968, Felicisimo married Merry Lee Corwin, with whom he had a son,
Tobias. However, on October 15, 1971, Merry Lee, an American citizen, filed a Complaint for
Divorce 5 before the Family Court of the First Circuit, State of Hawaii, United States of America
(U.S.A.), which issued a Decree Granting Absolute Divorce and Awarding Child Custody on December
14, 1973. 6

On June 20, 1974, Felicisimo married respondent Felicidad San Luis, then surnamed Sagalongos, before
Rev. Fr. William Meyer, Minister of the United Presbyterian at Wilshire Boulevard, Los Angeles,
California, U.S.A. 7 He had no children with respondent but lived with her for 18 years from the time of
their marriage up to his death on December 18, 1992.

Thereafter, respondent sought the dissolution of their conjugal partnership assets and the settlement of
Felicisimo’s estate. On December 17, 1993, she filed a petition for letters of administration 8 before the
Regional Trial Court of Makati City, docketed as SP. Proc. No. M-3708 which was raffled to Branch 146
thereof.

Respondent alleged that she is the widow of Felicisimo; that, at the time of his death, the decedent was
residing at 100 San Juanico Street, New Alabang Village, Alabang, Metro Manila; that the decedent’s
surviving heirs are respondent as legal spouse, his six children by his first marriage, and son by his
second marriage; that the decedent left real properties, both conjugal and exclusive, valued
at P30,304,178.00 more or less; that the decedent does not have any unpaid debts. Respondent prayed that
the conjugal partnership assets be liquidated and that letters of administration be issued to her.

On February 4, 1994, petitioner Rodolfo San Luis, one of the children of Felicisimo by his first marriage,
filed a motion to dismiss 9 on the grounds of improper venue and failure to state a cause of action.
Rodolfo claimed that the petition for letters of administration should have been filed in the Province of
Laguna because this was Felicisimo’s place of residence prior to his death. He further claimed that
respondent has no legal personality to file the petition because she was only a mistress of Felicisimo since
the latter, at the time of his death, was still legally married to Merry Lee.

On February 15, 1994, Linda invoked the same grounds and joined her brother Rodolfo in seeking the
dismissal10 of the petition. On February 28, 1994, the trial court issued an Order 11 denying the two
motions to dismiss.

Unaware of the denial of the motions to dismiss, respondent filed on March 5, 1994 her
opposition 12 thereto. She submitted documentary evidence showing that while Felicisimo exercised the
powers of his public office in Laguna, he regularly went home to their house in New Alabang Village,
Alabang, Metro Manila which they bought sometime in 1982. Further, she presented the decree of
absolute divorce issued by the Family Court of the First Circuit, State of Hawaii to prove that the
marriage of Felicisimo to Merry Lee had already been dissolved. Thus, she claimed that Felicisimo had
the legal capacity to marry her by virtue of paragraph 2, 13 Article 26 of the Family Code and the doctrine
laid down in Van Dorn v. Romillo, Jr. 14

Thereafter, Linda, Rodolfo and herein petitioner Edgar San Luis, separately filed motions for
reconsideration from the Order denying their motions to dismiss. 15 They asserted that paragraph 2,
Article 26 of the Family Code cannot be given retroactive effect to validate respondent’s bigamous
marriage with Felicisimo because this would impair vested rights in derogation of Article 256 16 of the
Family Code.

On April 21, 1994, Mila, another daughter of Felicisimo from his first marriage, filed a motion to
disqualify Acting Presiding Judge Anthony E. Santos from hearing the case.

On October 24, 1994, the trial court issued an Order 17 denying the motions for reconsideration. It ruled
that respondent, as widow of the decedent, possessed the legal standing to file the petition and that venue
was properly laid. Meanwhile, the motion for disqualification was deemed moot and academic 18 because
then Acting Presiding Judge Santos was substituted by Judge Salvador S. Tensuan pending the resolution
of said motion.

Mila filed a motion for inhibition 19 against Judge Tensuan on November 16, 1994. On even date, Edgar
also filed a motion for reconsideration 20 from the Order denying their motion for reconsideration arguing
that it does not state the facts and law on which it was based.

On November 25, 1994, Judge Tensuan issued an Order 21 granting the motion for inhibition. The case
was re-raffled to Branch 134 presided by Judge Paul T. Arcangel.

On April 24, 1995, 22 the trial court required the parties to submit their respective position papers on the
twin issues of venue and legal capacity of respondent to file the petition. On May 5, 1995, Edgar
manifested 23 that he is adopting the arguments and evidence set forth in his previous motion for
reconsideration as his position paper. Respondent and Rodolfo filed their position papers on June
14, 24 and June 20, 25 1995, respectively.

On September 12, 1995, the trial court dismissed the petition for letters of administration. It held that, at
the time of his death, Felicisimo was the duly elected governor and a resident of the Province of Laguna.
Hence, the petition should have been filed in Sta. Cruz, Laguna and not in Makati City. It also ruled that
respondent was without legal capacity to file the petition for letters of administration because her
marriage with Felicisimo was bigamous, thus, void ab initio. It found that the decree of absolute divorce
dissolving Felicisimo’s marriage to Merry Lee was not valid in the Philippines and did not bind
Felicisimo who was a Filipino citizen. It also ruled that paragraph 2, Article 26 of the Family Code cannot
be retroactively applied because it would impair the vested rights of Felicisimo’s legitimate children.

Respondent moved for reconsideration 26 and for the disqualification 27 of Judge Arcangel but said
motions were denied. 28

Respondent appealed to the Court of Appeals which reversed and set aside the orders of the trial court in
its assailed Decision dated February 4, 1998, the dispositive portion of which states:

WHEREFORE, the Orders dated September 12, 1995 and January 31, 1996 are hereby REVERSED and
SET ASIDE; the Orders dated February 28 and October 24, 1994 are REINSTATED; and the records of
the case is REMANDED to the trial court for further proceedings. 29

The appellante court ruled that under Section 1, Rule 73 of the Rules of Court, the term "place of
residence" of the decedent, for purposes of fixing the venue of the settlement of his estate, refers to the
personal, actual or physical habitation, or actual residence or place of abode of a person as distinguished
from legal residence or domicile. It noted that although Felicisimo discharged his functions as governor in
Laguna, he actually resided in Alabang, Muntinlupa. Thus, the petition for letters of administration was
properly filed in Makati City.

The Court of Appeals also held that Felicisimo had legal capacity to marry respondent by virtue of
paragraph 2, Article 26 of the Family Code and the rulings in Van Dorn v. Romillo, Jr. 30 and Pilapil v.
Ibay-Somera. 31 It found that the marriage between Felicisimo and Merry Lee was validly dissolved by
virtue of the decree of absolute divorce issued by the Family Court of the First Circuit, State of Hawaii.
As a result, under paragraph 2, Article 26, Felicisimo was capacitated to contract a subsequent marriage
with respondent. Thus –

With the well-known rule – express mandate of paragraph 2, Article 26, of the Family Code of the
Philippines, the doctrines in Van Dorn, Pilapil, and the reason and philosophy behind the enactment of
E.O. No. 227, — there is no justiciable reason to sustain the individual view — sweeping statement — of
Judge Arc[h]angel, that "Article 26, par. 2 of the Family Code, contravenes the basic policy of our state
against divorce in any form whatsoever." Indeed, courts cannot deny what the law grants. All that the
courts should do is to give force and effect to the express mandate of the law. The foreign divorce having
been obtained by the Foreigner on December 14, 1992,32 the Filipino divorcee, "shall x x x have capacity
to remarry under Philippine laws". For this reason, the marriage between the deceased and petitioner
should not be denominated as "a bigamous marriage.

Therefore, under Article 130 of the Family Code, the petitioner as the surviving spouse can institute the
judicial proceeding for the settlement of the estate of the deceased. x x x 33

Edgar, Linda, and Rodolfo filed separate motions for reconsideration 34 which were denied by the Court
of Appeals.

On July 2, 1998, Edgar appealed to this Court via the instant petition for review on certiorari. 35 Rodolfo
later filed a manifestation and motion to adopt the said petition which was granted. 36

In the instant consolidated petitions, Edgar and Rodolfo insist that the venue of the subject petition for
letters of administration was improperly laid because at the time of his death, Felicisimo was a resident of
Sta. Cruz, Laguna. They contend that pursuant to our rulings in Nuval v. Guray 37 and Romualdez v.
RTC, Br. 7, Tacloban City, 38 "residence" is synonymous with "domicile" which denotes a fixed
permanent residence to which when absent, one intends to return. They claim that a person can only have
one domicile at any given time. Since Felicisimo never changed his domicile, the petition for letters of
administration should have been filed in Sta. Cruz, Laguna.

Petitioners also contend that respondent’s marriage to Felicisimo was void and bigamous because it was
performed during the subsistence of the latter’s marriage to Merry Lee. They argue that paragraph 2,
Article 26 cannot be retroactively applied because it would impair vested rights and ratify the void
bigamous marriage. As such, respondent cannot be considered the surviving wife of Felicisimo; hence,
she has no legal capacity to file the petition for letters of administration.

The issues for resolution: (1) whether venue was properly laid, and (2) whether respondent has legal
capacity to file the subject petition for letters of administration.

The petition lacks merit.

Under Section 1, 39 Rule 73 of the Rules of Court, the petition for letters of administration of the estate of
Felicisimo should be filed in the Regional Trial Court of the province "in which he resides at the time of
his death." In the case of Garcia Fule v. Court of Appeals, 40 we laid down the doctrinal rule for
determining the residence – as contradistinguished from domicile – of the decedent for purposes of fixing
the venue of the settlement of his estate:

[T]he term "resides" connotes ex vi termini "actual residence" as distinguished from "legal residence or
domicile." This term "resides," like the terms "residing" and "residence," is elastic and should be
interpreted in the light of the object or purpose of the statute or rule in which it is employed. In the
application of venue statutes and rules – Section 1, Rule 73 of the Revised Rules of Court is of such
nature – residence rather than domicile is the significant factor. Even where the statute uses the word
"domicile" still it is construed as meaning residence and not domicile in the technical sense. Some cases
make a distinction between the terms "residence" and "domicile" but as generally used in statutes fixing
venue, the terms are synonymous, and convey the same meaning as the term "inhabitant." In other words,
"resides" should be viewed or understood in its popular sense, meaning, the personal, actual or physical
habitation of a person, actual residence or place of abode. It signifies physical presence in a place and
actual stay thereat. In this popular sense, the term means merely residence, that is, personal residence, not
legal residence or domicile. Residence simply requires bodily presence as an inhabitant in a given place,
while domicile requires bodily presence in that place and also an intention to make it one’s domicile. No
particular length of time of residence is required though; however, the residence must be more than
temporary. 41 (Emphasis supplied)

It is incorrect for petitioners to argue that "residence," for purposes of fixing the venue of the settlement
of the estate of Felicisimo, is synonymous with "domicile." The rulings in Nuval and Romualdez are
inapplicable to the instant case because they involve election cases. Needless to say, there is a distinction
between "residence" for purposes of election laws and "residence" for purposes of fixing the venue of
actions. In election cases, "residence" and "domicile" are treated as synonymous terms, that is, the fixed
permanent residence to which when absent, one has the intention of returning. 42 However, for purposes
of fixing venue under the Rules of Court, the "residence" of a person is his personal, actual or physical
habitation, or actual residence or place of abode, which may not necessarily be his legal residence or
domicile provided he resides therein with continuity and consistency. 43 Hence, it is possible that a person
may have his residence in one place and domicile in another.

In the instant case, while petitioners established that Felicisimo was domiciled in Sta. Cruz, Laguna,
respondent proved that he also maintained a residence in Alabang, Muntinlupa from 1982 up to the time
of his death. Respondent submitted in evidence the Deed of Absolute Sale 44 dated January 5, 1983
showing that the deceased purchased the aforesaid property. She also presented billing statements 45 from
the Philippine Heart Center and Chinese General Hospital for the period August to December 1992
indicating the address of Felicisimo at "100 San Juanico, Ayala Alabang, Muntinlupa." Respondent also
presented proof of membership of the deceased in the Ayala Alabang Village Association 46 and Ayala
Country Club, Inc., 47 letter-envelopes 48from 1988 to 1990 sent by the deceased’s children to him at his
Alabang address, and the deceased’s calling cards 49 stating that his home/city address is at "100 San
Juanico, Ayala Alabang Village, Muntinlupa" while his office/provincial address is in "Provincial
Capitol, Sta. Cruz, Laguna."

From the foregoing, we find that Felicisimo was a resident of Alabang, Muntinlupa for purposes of fixing
the venue of the settlement of his estate. Consequently, the subject petition for letters of administration
was validly filed in the Regional Trial Court 50 which has territorial jurisdiction over Alabang,
Muntinlupa. The subject petition was filed on December 17, 1993. At that time, Muntinlupa was still a
municipality and the branches of the Regional Trial Court of the National Capital Judicial Region which
had territorial jurisdiction over Muntinlupa were then seated in Makati City as per Supreme Court
Administrative Order No. 3. 51 Thus, the subject petition was validly filed before the Regional Trial Court
of Makati City.

Anent the issue of respondent Felicidad’s legal personality to file the petition for letters of administration,
we must first resolve the issue of whether a Filipino who is divorced by his alien spouse abroad may
validly remarry under the Civil Code, considering that Felicidad’s marriage to Felicisimo was solemnized
on June 20, 1974, or before the Family Code took effect on August 3, 1988. In resolving this issue, we
need not retroactively apply the provisions of the Family Code, particularly Art. 26, par. (2) considering
that there is sufficient jurisprudential basis allowing us to rule in the affirmative.

The case of Van Dorn v. Romillo, Jr. 52 involved a marriage between a foreigner and his Filipino wife,
which marriage was subsequently dissolved through a divorce obtained abroad by the latter. Claiming that
the divorce was not valid under Philippine law, the alien spouse alleged that his interest in the properties
from their conjugal partnership should be protected. The Court, however, recognized the validity of the
divorce and held that the alien spouse had no interest in the properties acquired by the Filipino wife after
the divorce. Thus:

In this case, the divorce in Nevada released private respondent from the marriage from the standards of
American law, under which divorce dissolves the marriage. As stated by the Federal Supreme Court of
the United States in Atherton vs. Atherton, 45 L. Ed. 794, 799:

"The purpose and effect of a decree of divorce from the bond of matrimony by a competent jurisdiction
are to change the existing status or domestic relation of husband and wife, and to free them both from the
bond. The marriage tie, when thus severed as to one party, ceases to bind either. A husband without a
wife, or a wife without a husband, is unknown to the law. When the law provides, in the nature of a
penalty, that the guilty party shall not marry again, that party, as well as the other, is still absolutely freed
from the bond of the former marriage."
Thus, pursuant to his national law, private respondent is no longer the husband of petitioner. He would
have no standing to sue in the case below as petitioner’s husband entitled to exercise control over
conjugal assets. As he is bound by the Decision of his own country’s Court, which validly exercised
jurisdiction over him, and whose decision he does not repudiate, he is estopped by his own representation
before said Court from asserting his right over the alleged conjugal property. 53

As to the effect of the divorce on the Filipino wife, the Court ruled that she should no longer be
considered married to the alien spouse. Further, she should not be required to perform her marital duties
and obligations. It held:

To maintain, as private respondent does, that, under our laws, petitioner has to be considered still
married to private respondent and still subject to a wife's obligations under Article 109, et. seq. of
the Civil Code cannot be just. Petitioner should not be obliged to live together with, observe respect and
fidelity, and render support to private respondent. The latter should not continue to be one of her heirs
with possible rights to conjugal property. She should not be discriminated against in her own country
if the ends of justice are to be served. 54 (Emphasis added)

This principle was thereafter applied in Pilapil v. Ibay-Somera 55 where the Court recognized the validity
of a divorce obtained abroad. In the said case, it was held that the alien spouse is not a proper party in
filing the adultery suit against his Filipino wife. The Court stated that "the severance of the marital bond
had the effect of dissociating the former spouses from each other, hence the actuations of one would not
affect or cast obloquy on the other." 56

Likewise, in Quita v. Court of Appeals, 57 the Court stated that where a Filipino is divorced by his
naturalized foreign spouse, the ruling in Van Dorn applies. 58 Although decided on December 22, 1998,
the divorce in the said case was obtained in 1954 when the Civil Code provisions were still in effect.

The significance of the Van Dorn case to the development of limited recognition of divorce in the
Philippines cannot be denied. The ruling has long been interpreted as severing marital ties between parties
in a mixed marriage and capacitating the Filipino spouse to remarry as a necessary consequence of
upholding the validity of a divorce obtained abroad by the alien spouse. In his treatise, Dr. Arturo M.
Tolentino cited Van Dorn stating that "if the foreigner obtains a valid foreign divorce, the Filipino spouse
shall have capacity to remarry under Philippine law." 59 In Garcia v. Recio, 60 the Court likewise cited the
aforementioned case in relation to Article 26. 61

In the recent case of Republic v. Orbecido III, 62 the historical background and legislative intent behind
paragraph 2, Article 26 of the Family Code were discussed, to wit:

Brief Historical Background

On July 6, 1987, then President Corazon Aquino signed into law Executive Order No. 209, otherwise
known as the "Family Code," which took effect on August 3, 1988. Article 26 thereof states:

All marriages solemnized outside the Philippines in accordance with the laws in force in the country
where they were solemnized, and valid there as such, shall also be valid in this country, except those
prohibited under Articles 35, 37, and 38.

On July 17, 1987, shortly after the signing of the original Family Code, Executive Order No. 227 was
likewise signed into law, amending Articles 26, 36, and 39 of the Family Code. A second paragraph was
added to Article 26. As so amended, it now provides:

ART. 26. All marriages solemnized outside the Philippines in accordance with the laws in force in the
country where they were solemnized, and valid there as such, shall also be valid in this country, except
those prohibited under Articles 35(1), (4), (5) and (6), 36, 37 and 38.

Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is
thereafter validly obtained abroad by the alien spouse capacitating him or her to remarry, the Filipino
spouse shall have capacity to remarry under Philippine law. (Emphasis supplied)

xxxx
Legislative Intent
Records of the proceedings of the Family Code deliberations showed that the intent of Paragraph 2 of
Article 26, according to Judge Alicia Sempio-Diy, a member of the Civil Code Revision Committee, is to
avoid the absurd situation where the Filipino spouse remains married to the alien spouse who, after
obtaining a divorce, is no longer married to the Filipino spouse.

Interestingly, Paragraph 2 of Article 26 traces its origin to the 1985 case of Van Dorn v. Romillo,
Jr. TheVan Dorn case involved a marriage between a Filipino citizen and a foreigner. The Court
held therein that a divorce decree validly obtained by the alien spouse is valid in the Philippines,
and consequently, the Filipino spouse is capacitated to remarry under Philippine law. 63 (Emphasis
added)

As such, the Van Dorn case is sufficient basis in resolving a situation where a divorce is validly obtained
abroad by the alien spouse. With the enactment of the Family Code and paragraph 2, Article 26 thereof,
our lawmakers codified the law already established through judicial precedent.1awphi1.net

Indeed, when the object of a marriage is defeated by rendering its continuance intolerable to one of the
parties and productive of no possible good to the community, relief in some way should be
obtainable. 64 Marriage, being a mutual and shared commitment between two parties, cannot possibly be
productive of any good to the society where one is considered released from the marital bond while the
other remains bound to it. Such is the state of affairs where the alien spouse obtains a valid divorce abroad
against the Filipino spouse, as in this case.

Petitioners cite Articles 15 65 and 17 66 of the Civil Code in stating that the divorce is void under
Philippine law insofar as Filipinos are concerned. However, in light of this Court’s rulings in the cases
discussed above, the Filipino spouse should not be discriminated against in his own country if the ends of
justice are to be served. 67 In Alonzo v. Intermediate Appellate Court, 68 the Court stated:

But as has also been aptly observed, we test a law by its results; and likewise, we may add, by its
purposes. It is a cardinal rule that, in seeking the meaning of the law, the first concern of the judge should
be to discover in its provisions the intent of the lawmaker. Unquestionably, the law should never be
interpreted in such a way as to cause injustice as this is never within the legislative intent. An
indispensable part of that intent, in fact, for we presume the good motives of the legislature, is to render
justice.

Thus, we interpret and apply the law not independently of but in consonance with justice. Law and justice
are inseparable, and we must keep them so. To be sure, there are some laws that, while generally valid,
may seem arbitrary when applied in a particular case because of its peculiar circumstances. In such a
situation, we are not bound, because only of our nature and functions, to apply them just the same, in
slavish obedience to their language. What we do instead is find a balance between the word and the will,
that justice may be done even as the law is obeyed.

As judges, we are not automatons. We do not and must not unfeelingly apply the law as it is worded,
yielding like robots to the literal command without regard to its cause and consequence. "Courts are apt to
err by sticking too closely to the words of a law," so we are warned, by Justice Holmes again, "where
these words import a policy that goes beyond them."

xxxx

More than twenty centuries ago, Justinian defined justice "as the constant and perpetual wish to render
every one his due." That wish continues to motivate this Court when it assesses the facts and the law in
every case brought to it for decision. Justice is always an essential ingredient of its decisions. Thus when
the facts warrants, we interpret the law in a way that will render justice, presuming that it was the
intention of the lawmaker, to begin with, that the law be dispensed with justice. 69

Applying the above doctrine in the instant case, the divorce decree allegedly obtained by Merry Lee
which absolutely allowed Felicisimo to remarry, would have vested Felicidad with the legal personality to
file the present petition as Felicisimo’s surviving spouse. However, the records show that there is
insufficient evidence to prove the validity of the divorce obtained by Merry Lee as well as the marriage of
respondent and Felicisimo under the laws of the U.S.A. In Garcia v. Recio, 70 the Court laid down the
specific guidelines for pleading and proving foreign law and divorce judgments. It held that presentation
solely of the divorce decree is insufficient and that proof of its authenticity and due execution must be
presented. Under Sections 24 and 25 of Rule 132, a writing or document may be proven as a public or
official record of a foreign country by either (1) an official publication or (2) a copy thereof attested by
the officer having legal custody of the document. If the record is not kept in the Philippines, such copy
must be (a) accompanied by a certificate issued by the proper diplomatic or consular officer in the
Philippine foreign service stationed in the foreign country in which the record is kept and (b)
authenticated by the seal of his office. 71

With regard to respondent’s marriage to Felicisimo allegedly solemnized in California, U.S.A., she
submitted photocopies of the Marriage Certificate and the annotated text 72 of the Family Law Act of
California which purportedly show that their marriage was done in accordance with the said law. As
stated in Garcia, however, the Court cannot take judicial notice of foreign laws as they must be alleged
and proved. 73

Therefore, this case should be remanded to the trial court for further reception of evidence on the divorce
decree obtained by Merry Lee and the marriage of respondent and Felicisimo.

Even assuming that Felicisimo was not capacitated to marry respondent in 1974, nevertheless, we find
that the latter has the legal personality to file the subject petition for letters of administration, as she may
be considered the co-owner of Felicisimo as regards the properties that were acquired through their joint
efforts during their cohabitation.

Section 6, 74 Rule 78 of the Rules of Court states that letters of administration may be granted to the
surviving spouse of the decedent. However, Section 2, Rule 79 thereof also provides in part:

SEC. 2. Contents of petition for letters of administration. – A petition for letters of administration must be
filed by an interested person and must show, as far as known to the petitioner: x x x.

An "interested person" has been defined as one who would be benefited by the estate, such as an heir, or
one who has a claim against the estate, such as a creditor. The interest must be material and direct, and
not merely indirect or contingent. 75

In the instant case, respondent would qualify as an interested person who has a direct interest in the estate
of Felicisimo by virtue of their cohabitation, the existence of which was not denied by petitioners. If she
proves the validity of the divorce and Felicisimo’s capacity to remarry, but fails to prove that her marriage
with him was validly performed under the laws of the U.S.A., then she may be considered as a co-owner
under Article 144 76 of the Civil Code. This provision governs the property relations between parties who
live together as husband and wife without the benefit of marriage, or their marriage is void from the
beginning. It provides that the property acquired by either or both of them through their work or industry
or their wages and salaries shall be governed by the rules on co-ownership. In a co-ownership, it is not
necessary that the property be acquired through their joint labor, efforts and industry. Any property
acquired during the union is prima facie presumed to have been obtained through their joint efforts.
Hence, the portions belonging to the co-owners shall be presumed equal, unless the contrary is proven. 77

Meanwhile, if respondent fails to prove the validity of both the divorce and the marriage, the applicable
provision would be Article 148 of the Family Code which has filled the hiatus in Article 144 of the Civil
Code by expressly regulating the property relations of couples living together as husband and wife but are
incapacitated to marry. 78In Saguid v. Court of Appeals, 79 we held that even if the cohabitation or the
acquisition of property occurred before the Family Code took effect, Article 148 governs. 80 The Court
described the property regime under this provision as follows:

The regime of limited co-ownership of property governing the union of parties who are not legally
capacitated to marry each other, but who nonetheless live together as husband and wife, applies to
properties acquired during said cohabitation in proportion to their respective contributions. Co-ownership
will only be up to the extent of the proven actual contribution of money, property or industry. Absent
proof of the extent thereof, their contributions and corresponding shares shall be presumed to be equal.

xxxx

In the cases of Agapay v. Palang, and Tumlos v. Fernandez, which involved the issue of co-ownership of
properties acquired by the parties to a bigamous marriage and an adulterous relationship, respectively, we
ruled that proof of actual contribution in the acquisition of the property is essential. x x x
As in other civil cases, the burden of proof rests upon the party who, as determined by the pleadings or
the nature of the case, asserts an affirmative issue. Contentions must be proved by competent evidence
and reliance must be had on the strength of the party’s own evidence and not upon the weakness of the
opponent’s defense. x x x81

In view of the foregoing, we find that respondent’s legal capacity to file the subject petition for letters of
administration may arise from her status as the surviving wife of Felicisimo or as his co-owner under
Article 144 of the Civil Code or Article 148 of the Family Code.

WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals reinstating and affirming
the February 28, 1994 Order of the Regional Trial Court which denied petitioners’ motion to dismiss and
its October 24, 1994 Order which dismissed petitioners’ motion for reconsideration is AFFIRMED. Let
this case be REMANDED to the trial court for further proceedings.

SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 167109 February 6, 2007

FELICITAS AMOR-CATALAN, Petitioner,


vs.
COURT OF APPEALS, MANILA, ORLANDO B. CATALAN and MEROPE E.
BRAGANZA, Respondents.

DECISION

YNARES-SANTIAGO, J.:

This petition for review assails the Decision1 of the Court of Appeals in CA-G.R. CV No. 69875 dated
August 6, 2004, which reversed the Decision2 of the Regional Trial Court (RTC) of Dagupan City,
Branch 44, in Civil Case No. D-10636, declaring the marriage between respondents Orlando B. Catalan
and Merope E. Braganza void on the ground of bigamy, as well as the Resolution3 dated January 27,
2005, which denied the motion for reconsideration.

Petitioner Felicitas Amor-Catalan married respondent Orlando on June 4, 1950 in Mabini,


Pangasinan.4Thereafter, they migrated to the United States of America and allegedly became naturalized
citizens thereof. After 38 years of marriage, Felicitas and Orlando divorced in April 1988.5

Two months after the divorce, or on June 16, 1988, Orlando married respondent Merope in Calasiao,
Pangasinan.6 Contending that said marriage was bigamous since Merope had a prior subsisting marriage
with Eusebio Bristol, petitioner filed a petition for declaration of nullity of marriage with damages in the
RTC of Dagupan City7 against Orlando and Merope.

Respondents filed a motion to dismiss8 on the ground of lack of cause of action as petitioner was
allegedly not a real party-in-interest, but it was denied.9 Trial on the merits ensued.

On October 10, 2000, the RTC rendered judgment in favor of the petitioner, the dispositive portion of
which reads:

WHEREFORE, judgment is declared in favor of plaintiff Felicitas Amor Catalan and against defendants
Orlando B. Catalan and Merope E. Braganza, as follows:

1) The subsequent marriage of Merope Braganza with Orlando B. Catalan is declared null and
void ab initio;
2) The defendants are ordered jointly and severally to pay plaintiff by way of moral damages the
amount of P300,000.00, exemplary damages in the amount of P200,000.00 and attorney’s fees in
the amount of P50,000.00, including costs of this suit; and

3) The donation in consideration of marriage is ordered revoked and the property donated is
ordered awarded to the heirs of Juliana Braganza.

Furnish copies of this Decision to Atty. Napoleon B. Arenas, Jr. and Atty. Nolan Evangelista.

SO ORDERED.10

Respondents appealed the decision to the Court of Appeals, which reversed the decision of the RTC, thus:

WHEREFORE, premises considered, we hereby GRANT the appeal and consequently REVERSE and
SET ASIDE the appealed decision. We likewise DISMISS Civil Case No. D-10636, RTC, Branch 44,
Dagupan City. No costs.

SO ORDERED.11

After the motion for reconsideration was denied, petitioner filed the instant petition for review raising the
following issues:

I.

WHETHER PETITIONER HAS THE REQUIRED STANDING IN COURT TO QUESTION THE


NULLITY OF THE MARRIAGE BETWEEN RESPONDENTS;

II.

WHETHER THE FAILURE OF THE COURT OF APPEALS TO DECLARE THE QUESTIONED


MARRIAGE VOID CONSTITUTES REVERSIBLE ERROR.12

Petitioner contends that the bigamous marriage of the respondents, which brought embarrassment to her
and her children, confers upon her an interest to seek judicial remedy to address her grievances and to
protect her family from further embarrassment and humiliation. She claims that the Court of Appeals
committed reversible error in not declaring the marriage void despite overwhelming evidence and the
state policy discouraging illegal and immoral marriages.13

The main issue to be resolved is whether petitioner has the personality to file a petition for the declaration
of nullity of marriage of the respondents on the ground of bigamy. However, this issue may not be
resolved without first determining the corollary factual issues of whether the petitioner and respondent
Orlando had indeed become naturalized American citizens and whether they had actually been judicially
granted a divorce decree.

While it is a settled rule that the Court is not a trier of facts and does not normally undertake the re-
examination of the evidence presented by the contending parties during the trial of the case,14 there are,
however, exceptions to this rule, like when the findings of facts of the RTC and the Court of Appeals are
conflicting, or when the findings are conclusions without citation of specific evidence on which they are
based.15

Both the RTC and the Court of Appeals found that petitioner and respondent Orlando were naturalized
American citizens and that they obtained a divorce decree in April 1988. However, after a careful review
of the records, we note that other than the allegations in the complaint and the testimony during the trial,
the records are bereft of competent evidence to prove their naturalization and divorce.

The Court of Appeals therefore had no basis when it held:

In light of the allegations of Felicitas’ complaint and the documentary and testimonial evidence she
presented, we deem it undisputed that Orlando and Felicitas are American citizens and had this
citizenship status when they secured their divorce decree in April 1988. We are not therefore dealing in
this case with Filipino citizens whose marital status is governed by the Family Code and our Civil Code,
but with American citizens who secured their divorce in the U.S. and who are considered by their national
law to be free to contract another marriage. x x x16

Further, the Court of Appeals mistakenly considered the failure of the petitioner to refute or contest the
allegation in respondents’ brief, that she and respondent Orlando were American citizens at the time they
secured their divorce in April 1988, as sufficient to establish the fact of naturalization and divorce. 17 We
note that it was the petitioner who alleged in her complaint that they acquired American citizenship and
that respondent Orlando obtained a judicial divorce decree.18 It is settled rule that one who alleges a fact
has the burden of proving it and mere allegation is not evidence.19

Divorce means the legal dissolution of a lawful union for a cause arising after marriage. But divorces are
of different types. The two basic ones are (1) absolute divorce or a vinculo matrimonii and (2) limited
divorce or a mensa et thoro. The first kind terminates the marriage, while the second suspends it and
leaves the bond in full force.20 A divorce obtained abroad by an alien may be recognized in our
jurisdiction, provided such decree is valid according to the national law of the foreigner.21 However,
before it can be recognized by our courts, the party pleading it must prove the divorce as a fact and
demonstrate its conformity to the foreign law allowing it, which must be proved considering that our
courts cannot take judicial notice of foreign laws.22

Without the divorce decree and foreign law as part of the evidence, we cannot rule on the issue of whether
petitioner has the personality to file the petition for declaration of nullity of marriage. After all, she may
have the personality to file the petition if the divorce decree obtained was a limited divorce or a mensa et
thoro; or the foreign law may restrict remarriage even after the divorce decree becomes absolute. 23 In
such case, the RTC would be correct to declare the marriage of the respondents void for being bigamous,
there being already in evidence two existing marriage certificates, which were both obtained in the
Philippines, one in Mabini, Pangasinan dated December 21, 1959 between Eusebio Bristol and
respondent Merope,24 and the other, in Calasiao, Pangasinan dated June 16, 1988 between the
respondents.25

However, if there was indeed a divorce decree obtained and which, following the national law of Orlando,
does not restrict remarriage, the Court of Appeals would be correct in ruling that petitioner has no legal
personality to file a petition to declare the nullity of marriage, thus:

Freed from their existing marital bond, each of the former spouses no longer has any interest nor should
each have the personality to inquire into the marriage that the other might subsequently contract. x x x
Viewed from another perspective, Felicitas has no existing interest in Orlando’s subsequent marriage
since the validity, as well as any defect or infirmity, of this subsequent marriage will not affect the
divorced status of Orlando and Felicitas. x x x26

True, under the New Civil Code which is the law in force at the time the respondents were married, or
even in the Family Code, there is no specific provision as to who can file a petition to declare the nullity
of marriage; however, only a party who can demonstrate "proper interest" can file the same. A petition to
declare the nullity of marriage, like any other actions, must be prosecuted or defended in the name of the
real party in interest27 and must be based on a cause of action.28 Thus, in Niñal v. Bayadog,29 the Court
held that the children have the personality to file the petition to declare the nullity of the marriage of their
deceased father to their stepmother as it affects their successional rights.1awphi1.net

Significantly, Section 2(a) of The Rule on Declaration of Absolute Nullity of Void Marriages and
Annulment of Voidable Marriages, which took effect on March 15, 2003, now specifically provides:

SECTION 2. Petition for declaration of absolute nullity of void marriages. —

(a) Who may file. — A petition for declaration of absolute nullity of void marriage may be filed solely by
the husband or the wife.

xxxx

In fine, petitioner’s personality to file the petition to declare the nullity of marriage cannot be ascertained
because of the absence of the divorce decree and the foreign law allowing it. Hence, a remand of the case
to the trial court for reception of additional evidence is necessary to determine whether respondent
Orlando was granted a divorce decree and whether the foreign law which granted the same allows or
restricts remarriage. If it is proved that a valid divorce decree was obtained and the same did not allow
respondent Orlando’s remarriage, then the trial court should declare respondents’ marriage as bigamous
and void ab initio but reduce the amount of moral damages from P300,000.00 to P50,000.00 and
exemplary damages from P200,000.00 to P25,000.00. On the contrary, if it is proved that a valid divorce
decree was obtained which allowed Orlando to remarry, then the trial court must dismiss the instant
petition to declare nullity of marriage on the ground that petitioner Felicitas Amor-Catalan lacks legal
personality to file the same.

WHEREFORE, in view of the foregoing, let this case be REMANDED to the trial court for its proper
disposition. No costs.

SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

EN BANC

G.R. No. L-19671 November 29, 1965

PASTOR B. TENCHAVEZ, plaintiff-appellant,


vs.
VICENTA F. ESCAÑO, ET AL., defendants-appellees.

I. V. Binamira & F. B. Barria for plaintiff-appellant.


Jalandoni & Jarnir for defendants-appellees.

REYES, J.B.L., J.:

Direct appeal, on factual and legal questions, from the judgment of the Court of First Instance of Cebu, in
its Civil Case No. R-4177, denying the claim of the plaintiff-appellant, Pastor B. Tenchavez, for legal
separation and one million pesos in damages against his wife and parents-in-law, the defendants-
appellees, Vicente, Mamerto and Mena,1 all surnamed "Escaño," respectively.2

The facts, supported by the evidence of record, are the following:

Missing her late afternoon classes on 24 February 1948 in the University of San Carlos, Cebu City, where
she was then enrolled as a second year student of commerce, Vicenta Escaño, 27 years of age (scion of a
well-to-do and socially prominent Filipino family of Spanish ancestry and a "sheltered colegiala"),
exchanged marriage vows with Pastor Tenchavez, 32 years of age, an engineer, ex-army officer and of
undistinguished stock, without the knowledge of her parents, before a Catholic chaplain, Lt. Moises
Lavares, in the house of one Juan Alburo in the said city. The marriage was the culmination of a previous
love affair and was duly registered with the local civil register.

Vicenta's letters to Pastor, and his to her, before the marriage, indicate that the couple were deeply in
love. Together with a friend, Pacita Noel, their matchmaker and go-between, they had planned out their
marital future whereby Pacita would be the governess of their first-born; they started saving money in a
piggy bank. A few weeks before their secret marriage, their engagement was broken; Vicenta returned the
engagement ring and accepted another suitor, Joseling Lao. Her love for Pastor beckoned; she pleaded for
his return, and they reconciled. This time they planned to get married and then elope. To facilitate the
elopement, Vicenta had brought some of her clothes to the room of Pacita Noel in St. Mary's Hall, which
was their usual trysting place.

Although planned for the midnight following their marriage, the elopement did not, however, materialize
because when Vicente went back to her classes after the marriage, her mother, who got wind of the
intended nuptials, was already waiting for her at the college. Vicenta was taken home where she admitted
that she had already married Pastor. Mamerto and Mena Escaño were surprised, because Pastor never
asked for the hand of Vicente, and were disgusted because of the great scandal that the clandestine
marriage would provoke (t.s.n., vol. III, pp. 1105-06). The following morning, the Escaño spouses sought
priestly advice. Father Reynes suggested a recelebration to validate what he believed to be an invalid
marriage, from the standpoint of the Church, due to the lack of authority from the Archbishop or the
parish priest for the officiating chaplain to celebrate the marriage. The recelebration did not take place,
because on 26 February 1948 Mamerto Escaño was handed by a maid, whose name he claims he does not
remember, a letter purportedly coming from San Carlos college students and disclosing an amorous
relationship between Pastor Tenchavez and Pacita Noel; Vicenta translated the letter to her father, and
thereafter would not agree to a new marriage. Vicenta and Pastor met that day in the house of Mrs. Pilar
Mendezona. Thereafter, Vicenta continued living with her parents while Pastor returned to his job in
Manila. Her letter of 22 March 1948 (Exh. "M"), while still solicitous of her husband's welfare, was not as
endearing as her previous letters when their love was aflame.

Vicenta was bred in Catholic ways but is of a changeable disposition, and Pastor knew it. She fondly
accepted her being called a "jellyfish." She was not prevented by her parents from communicating with
Pastor (Exh. "1-Escaño"), but her letters became less frequent as the days passed. As of June, 1948 the
newlyweds were already estranged (Exh. "2-Escaño"). Vicenta had gone to Jimenez, Misamis Occidental,
to escape from the scandal that her marriage stirred in Cebu society. There, a lawyer filed for her a
petition, drafted by then Senator Emmanuel Pelaez, to annul her marriage. She did not sign the petition
(Exh. "B-5"). The case was dismissed without prejudice because of her non-appearance at the hearing
(Exh. "B-4").

On 24 June 1950, without informing her husband, she applied for a passport, indicating in her application
that she was single, that her purpose was to study, and she was domiciled in Cebu City, and that she
intended to return after two years. The application was approved, and she left for the United States. On 22
August 1950, she filed a verified complaint for divorce against the herein plaintiff in the Second Judicial
District Court of the State of Nevada in and for the County of Washoe, on the ground of "extreme cruelty,
entirely mental in character." On 21 October 1950, a decree of divorce, "final and absolute", was issued in
open court by the said tribunal.

In 1951 Mamerto and Mena Escaño filed a petition with the Archbishop of Cebu to annul their daughter's
marriage to Pastor (Exh. "D"). On 10 September 1954, Vicenta sought papal dispensation of her marriage
(Exh. "D"-2).

On 13 September 1954, Vicenta married an American, Russell Leo Moran, in Nevada. She now lives with
him in California, and, by him, has begotten children. She acquired American citizenship on 8 August
1958.

But on 30 July 1955, Tenchavez had initiated the proceedings at bar by a complaint in the Court of First
Instance of Cebu, and amended on 31 May 1956, against Vicenta F. Escaño, her parents, Mamerto and
Mena Escaño, whom he charged with having dissuaded and discouraged Vicenta from joining her
husband, and alienating her affections, and against the Roman Catholic Church, for having, through its
Diocesan Tribunal, decreed the annulment of the marriage, and asked for legal separation and one million
pesos in damages. Vicenta claimed a valid divorce from plaintiff and an equally valid marriage to her
present husband, Russell Leo Moran; while her parents denied that they had in any way influenced their
daughter's acts, and counterclaimed for moral damages.

The appealed judgment did not decree a legal separation, but freed the plaintiff from supporting his wife
and to acquire property to the exclusion of his wife. It allowed the counterclaim of Mamerto Escaño and
Mena Escaño for moral and exemplary damages and attorney's fees against the plaintiff-appellant, to the
extent of P45,000.00, and plaintiff resorted directly to this Court.

The appellant ascribes, as errors of the trial court, the following:

1. In not declaring legal separation; in not holding defendant Vicenta F. Escaño liable for
damages and in dismissing the complaint;.

2. In not holding the defendant parents Mamerto Escano and the heirs of Doña Mena Escaño
liable for damages;.

3 In holding the plaintiff liable for and requiring him to pay the damages to the defendant parents
on their counterclaims; and.
4. In dismissing the complaint and in denying the relief sought by the plaintiff.

That on 24 February 1948 the plaintiff-appellant, Pastor Tenchavez, and the defendant-appellee, Vicenta
Escaño, were validly married to each other, from the standpoint of our civil law, is clearly established by
the record before us. Both parties were then above the age of majority, and otherwise qualified; and both
consented to the marriage, which was performed by a Catholic priest (army chaplain Lavares) in the
presence of competent witnesses. It is nowhere shown that said priest was not duly authorized under civil
law to solemnize marriages.

The chaplain's alleged lack of ecclesiastical authorization from the parish priest and the Ordinary, as
required by Canon law, is irrelevant in our civil law, not only because of the separation of Church and
State but also because Act 3613 of the Philippine Legislature (which was the marriage law in force at the
time) expressly provided that —

SEC. 1. Essential requisites. Essential requisites for marriage are the legal capacity of the
contracting parties and consent. (Emphasis supplied)

The actual authority of the solemnizing officer was thus only a formal requirement, and, therefore, not
essential to give the marriage civil effects,3 and this is emphasized by section 27 of said marriage act,
which provided the following:

SEC. 27. Failure to comply with formal requirements. No marriage shall be declared invalid
because of the absence of one or several of the formal requirements of this Act if, when it was
performed, the spouses or one of them believed in good faith that the person who solemnized the
marriage was actually empowered to do so, and that the marriage was perfectly legal.

The good faith of all the parties to the marriage (and hence the validity of their marriage) will be
presumed until the contrary is positively proved (Lao vs. Dee Tim, 45 Phil. 739, 745; Francisco vs. Jason,
60 Phil. 442, 448). It is well to note here that in the case at bar, doubts as to the authority of the
solemnizing priest arose only after the marriage, when Vicenta's parents consulted Father Reynes and the
archbishop of Cebu. Moreover, the very act of Vicenta in abandoning her original action for annulment
and subsequently suing for divorce implies an admission that her marriage to plaintiff was valid and
binding.

Defendant Vicenta Escaño argues that when she contracted the marriage she was under the undue
influence of Pacita Noel, whom she charges to have been in conspiracy with appellant Tenchavez. Even
granting, for argument's sake, the truth of that contention, and assuming that Vicenta's consent was
vitiated by fraud and undue influence, such vices did not render her marriage ab initio void, but merely
voidable, and the marriage remained valid until annulled by a competent civil court. This was never done,
and admittedly, Vicenta's suit for annulment in the Court of First Instance of Misamis was dismissed for
non-prosecution.

It is equally clear from the record that the valid marriage between Pastor Tenchavez and Vicenta Escaño
remained subsisting and undissolved under Philippine law, notwithstanding the decree of absolute divorce
that the wife sought and obtained on 21 October 1950 from the Second Judicial District Court of Washoe
County, State of Nevada, on grounds of "extreme cruelty, entirely mental in character." At the time the
divorce decree was issued, Vicenta Escaño, like her husband, was still a Filipino citizen.4 She was then
subject to Philippine law, and Article 15 of the Civil Code of the Philippines (Rep. Act No. 386), already
in force at the time, expressly provided:

Laws relating to family rights and duties or to the status, condition and legal capacity of persons
are binding upon the citizens of the Philippines, even though living abroad.

The Civil Code of the Philippines, now in force, does not admit absolute divorce, quo ad vinculo
matrimonii; and in fact does not even use that term, to further emphasize its restrictive policy on the
matter, in contrast to the preceding legislation that admitted absolute divorce on grounds of adultery of
the wife or concubinage of the husband (Act 2710). Instead of divorce, the present Civil Code only
provides for legal separation (Title IV, Book 1, Arts. 97 to 108), and, even in that case, it expressly
prescribes that "the marriage bonds shall not be severed" (Art. 106, subpar. 1).
For the Philippine courts to recognize and give recognition or effect to a foreign decree of absolute
divorce betiveen Filipino citizens could be a patent violation of the declared public policy of the state,
specially in view of the third paragraph of Article 17 of the Civil Code that prescribes the following:

Prohibitive laws concerning persons, their acts or property, and those which have for their object
public order, policy and good customs, shall not be rendered ineffective by laws or judgments
promulgated, or by determinations or conventions agreed upon in a foreign country.

Even more, the grant of effectivity in this jurisdiction to such foreign divorce decrees would, in effect,
give rise to an irritating and scandalous discrimination in favor of wealthy citizens, to the detriment of
those members of our polity whose means do not permit them to sojourn abroad and obtain absolute
divorces outside the Philippines.

From this point of view, it is irrelevant that appellant Pastor Tenchavez should have appeared in the
Nevada divorce court. Primarily because the policy of our law cannot be nullified by acts of private
parties (Civil Code,Art. 17, jam quot.); and additionally, because the mere appearance of a non-resident
consort cannot confer jurisdiction where the court originally had none (Area vs. Javier, 95 Phil. 579).

From the preceding facts and considerations, there flows as a necessary consequence that in this
jurisdiction Vicenta Escaño's divorce and second marriage are not entitled to recognition as valid; for her
previous union to plaintiff Tenchavez must be declared to be existent and undissolved. It follows,
likewise, that her refusal to perform her wifely duties, and her denial of consortium and her desertion of
her husband constitute in law a wrong caused through her fault, for which the husband is entitled to the
corresponding indemnity (Civil Code, Art. 2176). Neither an unsubstantiated charge of deceit nor an
anonymous letter charging immorality against the husband constitute, contrary to her claim, adequate
excuse. Wherefore, her marriage and cohabitation with Russell Leo Moran is technically "intercourse
with a person not her husband" from the standpoint of Philippine Law, and entitles plaintiff-appellant
Tenchavez to a decree of "legal separation under our law, on the basis of adultery" (Revised Penal Code,
Art. 333).

The foregoing conclusions as to the untoward effect of a marriage after an invalid divorce are in accord
with the previous doctrines and rulings of this court on the subject, particularly those that were rendered
under our laws prior to the approval of the absolute divorce act (Act 2710 of the Philippine Legislature).
As a matter of legal history, our statutes did not recognize divorces a vinculo before 1917, when Act 2710
became effective; and the present Civil Code of the Philippines, in disregarding absolute divorces, in
effect merely reverted to the policies on the subject prevailing before Act 2710. The rulings, therefore,
under the Civil Code of 1889, prior to the Act above-mentioned, are now, fully applicable. Of these, the
decision in Ramirez vs. Gmur, 42 Phil. 855, is of particular interest. Said this Court in that case:

As the divorce granted by the French Court must be ignored, it results that the marriage of Dr.
Mory and Leona Castro, celebrated in London in 1905, could not legalize their relations; and the
circumstance that they afterwards passed for husband and wife in Switzerland until her death is
wholly without legal significance. The claims of the very children to participate in the estate of
Samuel Bishop must therefore be rejected. The right to inherit is limited to legitimate, legitimated
and acknowledged natural children. The children of adulterous relations are wholly excluded. The
word "descendants" as used in Article 941 of the Civil Code cannot be interpreted to include
illegitimates born of adulterous relations. (Emphasis supplied)

Except for the fact that the successional rights of the children, begotten from Vicenta's marriage to Leo
Moran after the invalid divorce, are not involved in the case at bar, the Gmur case is authority for the
proposition that such union is adulterous in this jurisdiction, and, therefore, justifies an action for legal
separation on the part of the innocent consort of the first marriage, that stands undissolved in Philippine
law. In not so declaring, the trial court committed error.

True it is that our ruling gives rise to anomalous situations where the status of a person (whether divorced
or not) would depend on the territory where the question arises. Anomalies of this kind are not new in the
Philippines, and the answer to them was given in Barretto vs. Gonzales, 58 Phil. 667:

The hardship of the existing divorce laws in the Philippine Islands are well known to the
members of the Legislature. It is the duty of the Courts to enforce the laws of divorce as written
by Legislature if they are constitutional. Courts have no right to say that such laws are too strict
or too liberal. (p. 72)

The appellant's first assignment of error is, therefore, sustained.

However, the plaintiff-appellant's charge that his wife's parents, Dr. Mamerto Escaño and his wife, the
late Doña Mena Escaño, alienated the affections of their daughter and influenced her conduct toward her
husband are not supported by credible evidence. The testimony of Pastor Tenchavez about the Escaño's
animosity toward him strikes us to be merely conjecture and exaggeration, and are belied by Pastor's own
letters written before this suit was begun (Exh. "2-Escaño" and "Vicenta," Rec. on App., pp. 270-274). In
these letters he expressly apologized to the defendants for "misjudging them" and for the "great
unhappiness" caused by his "impulsive blunders" and "sinful pride," "effrontery and audacity" [sic].
Plaintiff was admitted to the Escaño house to visit and court Vicenta, and the record shows nothing to
prove that he would not have been accepted to marry Vicente had he openly asked for her hand, as good
manners and breeding demanded. Even after learning of the clandestine marriage, and despite their shock
at such unexpected event, the parents of Vicenta proposed and arranged that the marriage be recelebrated
in strict conformity with the canons of their religion upon advice that the previous one was canonically
defective. If no recelebration of the marriage ceremony was had it was not due to defendants Mamerto
Escaño and his wife, but to the refusal of Vicenta to proceed with it. That the spouses Escaño did not seek
to compel or induce their daughter to assent to the recelebration but respected her decision, or that they
abided by her resolve, does not constitute in law an alienation of affections. Neither does the fact that
Vicenta's parents sent her money while she was in the United States; for it was natural that they should
not wish their daughter to live in penury even if they did not concur in her decision to divorce Tenchavez
(27 Am. Jur. 130-132).

There is no evidence that the parents of Vicenta, out of improper motives, aided and abetted her original
suit for annulment, or her subsequent divorce; she appears to have acted independently, and being of age,
she was entitled to judge what was best for her and ask that her decisions be respected. Her parents, in so
doing, certainly cannot be charged with alienation of affections in the absence of malice or unworthy
motives, which have not been shown, good faith being always presumed until the contrary is proved.

SEC. 529. Liability of Parents, Guardians or Kin. — The law distinguishes between the right of a
parent to interest himself in the marital affairs of his child and the absence of rights in a stranger
to intermeddle in such affairs. However, such distinction between the liability of parents and that
of strangers is only in regard to what will justify interference. A parent isliable for alienation of
affections resulting from his own malicious conduct, as where he wrongfully entices his son or
daughter to leave his or her spouse, but he is not liable unless he acts maliciously, without
justification and from unworthy motives. He is not liable where he acts and advises his child in
good faith with respect to his child's marital relations in the interest of his child as he sees it, the
marriage of his child not terminating his right and liberty to interest himself in, and be extremely
solicitous for, his child's welfare and happiness, even where his conduct and advice suggest or
result in the separation of the spouses or the obtaining of a divorce or annulment, or where he acts
under mistake or misinformation, or where his advice or interference are indiscreet or
unfortunate, although it has been held that the parent is liable for consequences resulting from
recklessness. He may in good faith take his child into his home and afford him or her protection
and support, so long as he has not maliciously enticed his child away, or does not maliciously
entice or cause him or her to stay away, from his or her spouse. This rule has more frequently
been applied in the case of advice given to a married daughter, but it is equally applicable in the
case of advice given to a son.

Plaintiff Tenchavez, in falsely charging Vicenta's aged parents with racial or social discrimination and
with having exerted efforts and pressured her to seek annulment and divorce, unquestionably caused them
unrest and anxiety, entitling them to recover damages. While this suit may not have been impelled by
actual malice, the charges were certainly reckless in the face of the proven facts and circumstances. Court
actions are not established for parties to give vent to their prejudices or spleen.

In the assessment of the moral damages recoverable by appellant Pastor Tenchavez from defendant
Vicente Escaño, it is proper to take into account, against his patently unreasonable claim for a million
pesos in damages, that (a) the marriage was celebrated in secret, and its failure was not characterized by
publicity or undue humiliation on appellant's part; (b) that the parties never lived together; and (c) that
there is evidence that appellant had originally agreed to the annulment of the marriage, although such a
promise was legally invalid, being against public policy (cf. Art. 88, Civ. Code). While appellant is
unable to remarry under our law, this fact is a consequence of the indissoluble character of the union that
appellant entered into voluntarily and with open eyes rather than of her divorce and her second marriage.
All told, we are of the opinion that appellant should recover P25,000 only by way of moral damages and
attorney's fees.

With regard to the P45,000 damages awarded to the defendants, Dr. Mamerto Escaño and Mena Escaño,
by the court below, we opine that the same are excessive. While the filing of this unfounded suit must
have wounded said defendants' feelings and caused them anxiety, the same could in no way have
seriously injured their reputation, or otherwise prejudiced them, lawsuits having become a common
occurrence in present society. What is important, and has been correctly established in the decision of the
court below, is that said defendants were not guilty of any improper conduct in the whole deplorable
affair. This Court, therefore, reduces the damages awarded to P5,000 only.

Summing up, the Court rules:

(1) That a foreign divorce between Filipino citizens, sought and decreed after the effectivity of the present
Civil Code (Rep. Act 386), is not entitled to recognition as valid in this jurisdiction; and neither is the
marriage contracted with another party by the divorced consort, subsequently to the foreign decree of
divorce, entitled to validity in the country;

(2) That the remarriage of divorced wife and her co-habitation with a person other than the lawful
husband entitle the latter to a decree of legal separation conformably to Philippine law;

(3) That the desertion and securing of an invalid divorce decree by one consort entitles the other to
recover damages;

(4) That an action for alienation of affections against the parents of one consort does not lie in the absence
of proof of malice or unworthy motives on their part.

WHEREFORE, the decision under appeal is hereby modified as follows;

(1) Adjudging plaintiff-appellant Pastor Tenchavez entitled to a decree of legal separation from defendant
Vicenta F. Escaño;

(2) Sentencing defendant-appellee Vicenta Escaño to pay plaintiff-appellant Tenchavez the amount of
P25,000 for damages and attorneys' fees;

(3) Sentencing appellant Pastor Tenchavez to pay the appellee, Mamerto Escaño and the estate of his
wife, the deceased Mena Escaño, P5,000 by way of damages and attorneys' fees.

Neither party to recover costs.

Bengzon, C.J., Bautista Angelo, Concepcion, Dizon, Regala, Makalintal, Bengzon, J.P. and Zaldivar,
JJ., concur.

Footnotes

1
The latter was substituted by her heirs when she died during the pendency of the case in the trial
court.

2
The original complaint included the Roman Catholic Church as a defendant, sought to be
enjoined from acting on a petition for the ecclesiastical annulment of the marriage between Pastor
Tenchavez and Vicenta Escaño; the case against the defendant Church was dismissed on a joint
motion.

3
In the present Civil Code the contrary rule obtains (Art. 53).
4
She was naturalized as an American citizen only on 8 August 1958.

EN BANC
[G.R. No. L-7817. October 31, 1956.]
ALFREDO M. VELAYO, in his capacity as Assignee of the insolvent COMMERCIAL AIR LINES,
INC. (CALI), Plaintiff-Appellant, vs. SHELL COMPANY OF THE PHILIPPINE ISLANDS,
LTD., Defendant-Appellee, YEK HUA TRADING CORPORATION, PAUL SYCIP and MABASA
& CO., intervenors.

DECISION
FELIX, J.:
Antecedents — The Commercial Air Lines, Inc., which will be hereinafter referred to as CALI, is a
corporation duly organized and existing in accordance with the Philippines laws, with offices in the City
of Manila and previously engaged in air transportation business. The Shell Company of the P. I., Ltd.,
which will be designated as the Defendant, is on the other hand, a corporation organized under the laws of
England and duly licensed to do business in the Philippines, with principal offices at the Hongkong and
Shanghai Bank building in the City of Manila.
Since the start of CALI’s operations, its fuel needs were all supplied by the Defendant. Mr. Desmond
Fitzgerald, its Credit Manager who extended credit to CALI, was in charge of the collection thereof.
However, all matters referring to extensions of the term of payment had to be decided first by Mr.
Stephen Crawford and later by Mr. Wildred Wooding, who represented in this country Defendant’s Board
of Directors, the residence of which is in London, England (Exhs. 4-B and 4-A).
As of August, 1948, the books of the Defendant showed a balance of P170,162.58 in its favor for goods it
sold and delivered to CALI. Even before August 6, 1948, Defendant had reasons to believe that the
financial condition of the CALI was for from being satisfactory. As a matter of fact, according to Mr.
Fitzgerald, CALI’s Douglas C-54 plane, then in California, was offered to him by Mr. Alfonso Sycip,
CALI’s President of the Board of Directors, in partial settlement of their accounts, which offer was,
however, declined by Mr. Crawford, probably because upon inquiries made by Mr. Fitzgerald sometime
before August 6, 1948, for the purpose of preparing the report for its London office regarding CALI’s
indebtedness, Col. Lambert, CALI’s Vice President and General Manager, answered that the total
outstanding liabilities of his corporation was only P550,000, and the management of Defendant probably
assumed that the assets of the CALI could very well meet said liabilities and were not included to take
charge of the sale of CALI’s said Douglas C-54 plane to collect its credit.
On August 6, 1948, the management of CALI informally convened its principal creditors (excepting only
the insignificant small claims) who were invited to a luncheon that was held between
12:chanroblesvirtuallawlibrary00 and 2:chanroblesvirtuallawlibrary00 o’clock in the afternoon of that day
in the Trade and Commerce Building at 123 Juan Luna St., Manila, and informed them that CALI was in
a state of insolvency and had to stop operation. The creditors present, or represented at the meeting,
were:chanroblesvirtuallawlibrary Mr. A. L. Bartolini, representing Firestone Tire & Rubber Co.; chan
roblesvirtualawlibraryMr. Quintin Yu, representing Commercial News; chan roblesvirtualawlibraryMr.
Mark Pringle, representing Smith, Bell & Co. (Lloyds of London); chan roblesvirtualawlibraryMessrs.
Vicente Liwag, C. Dominguez and Pacifico Agcaoili, representing National Airports Corporation; chan
roblesvirtualawlibraryMessrs. W. J. Bunnel and Manuel Chan, representing Goodrich International
Rubber Co.; chan roblesvirtualawlibraryMr. G. E. Adair, representing Goodyear Tire & Rubber Co.; chan
roblesvirtualawlibraryMr. J. T. Chuidian, representing Gibbs, Gibbs, Chuidian & Quasha; chan
roblesvirtualawlibraryMr. E. Valera, representing Mabasa & Co.; chan roblesvirtualawlibraryMr. D.
Fitzgerald, representing Shell Co. P.I. Ltd.; chan roblesvirtualawlibraryand Mr. Alfonso Z. Sycip,
representing himself, Yek Hua Trading Corporation and Paul Sycip (Exhs. NN, JJJ, MM, QQQ, II-4, SS,
TT, UU, VV, WW, XX, YY, ZZ, AAA, BBB, CCC, DDD, EEE, FFF, GGG, and HHH).
The persons present, including Mr. Desmond Fitzgerald, signed their names and the names of the
companies they represented on a memorandum pad of the law firm Quisumbing, Sycip, and Quisumbing
(Exhs. VV and VV-1).
In that meeting at noontime of August 6, 1948, out of the 194 creditors in all (Exh. OO) 15 were listed as
principal creditors having big balances (Exh. NN), to wit:chanroblesvirtuallawlibrary
13th Air Force P12,880.00
Civil Aeronautics Administration 98,127.00
Gibbs, Giibs, Chuidian & Quasha 5,544.90
Goodrich Int’l Rubber Co. 3,142.47
Goodyear Tire & Rubber Co. 1,727.50
Mabasa & Co. 4,867.72
Manila Int’l Airport 55,280.04
Manila Int’l Air Terminal (PAL) 36,163.68
Shell Co. of the Phil., Ltd. 152,641.68
Smith, Bell & Co., Ltd. 45,534.00
Paul Sycip 8,189.33
Mrs. Buenaventura 20,000.00
Firestone Tire & Rubber Co. 4,911.72
Alfonso Sycip 575,880.83
Yek Hua Trading Corp. 487,871.20
—————
P1,512,762.87
What occurred in that meeting may be summarized as follows:chanroblesvirtuallawlibrary Mr. Alexander
Sycip, Secretary of the Board of Directors of the CALI, informed the creditors present that this
corporation was insolvent and had to stop operations. He explained the memorandum agreement executed
by the CALI with the Philippine Air Lines, Inc., on August 4, 1948, regarding the proposed sale to the
latter of the aviation equipments of the former (Exhs. MM and QQQ, par. 1 — memo of meeting; chan
roblesvirtualawlibraryExhs. III and PPP — P. Agcaoili’s memorandum dated August 7, 1948, to the
General Manager of the National Airports Corp.). Mr. Alexander Sycip was assisted in the explanation by
CPA Alfredo Velayo of Washington, Sycip & Company, Auditors of the CALI, who discussed the
balance sheets and distributed copies thereof to the creditors present (Exhs. NN, NN-1 to 7; chan
roblesvirtualawlibraryExh. JJ — P. Agcaoili’s copy of balance sheet p. 229- 230 t.s.n., Nov. 27, 1951, of
the testimony of D. Fitzgerald). The said balance sheet made mention of a C-54 plane in the United
States, the property now involved in this suit. He was likewise assisted in his explanation by Mr. Curtis L.
Lambert, Vice President and General Manager of the CALI, who described in greater detail the assets of
the CALI. There was a general understanding among all the creditors present on the desirability of
consummating the sale in favor of the Philippine Air Lines Inc. (Exhs. MM and QQQ, par. 2 — Memo of
meeting; chan roblesvirtualawlibraryExhs. III and PPP, par. 5 — P. Agcoaili’s memorandum dated
August 7, 1948, to the General Manager of the National Airports Corp.; chan roblesvirtualawlibraryand
pp. 299-300 t.s.n., January 15, 1952, of the testimony of Desmond Fitzgerald).
Then followed a discussion on the payment of claims of creditors and the preferences claimed for the
accounts due to the employees, the Government and the National Airports Corporation. The
representatives of the latter Messrs. Vicente H. Liwag, C. Dominguez and Pacifico V. Agcaoili,
contended that their accounts were preferred. The other creditors disputed such contention of preference
(Exhs. MM and QQQ, par. 3 — 0151 Memo of meeting; chan roblesvirtualawlibraryExhs. III and PPP,
par. 3 — P. Agcaoili’s memorandum dated August 1, 1948, to the General Manager of the National
Airports Corp.; chan roblesvirtualawlibraryand pp. 247-248 t.s.n., January 10, 1952, of the testimony of
D. Fitzgerald). No understanding was reached on this point and it was then generally agreed that the
matter of preference be further studied by a working committee to be formed (Exhs. MM, par. 3 — Memo
of meeting). The creditors present agreed to the formation of a working committee to continue the
discussion of the payment of claims and preferences alleged by certain creditors, and it was further agreed
that said working committee would supervise the preservation of the properties of the corporation while
the creditors attempted to come to an understanding as to a fair distribution of the assets among them
(Exhs. MM and QQQ, Memo of meeting). From the latter exhibit the following is
copied:chanroblesvirtuallawlibrary
“4. Certain specific matters such as the amount owing to the Philippine Air Lines, Inc., and the claims of
Smith, Bell vs. Co., (representing Lloyds of London) that its claim should be offset against the payments
which may be due to CALI from insurance claims were not taken up in detail. It was agreed that these
matters together with the general question of what are preferred claims should be the subject of further
discussions, but shall not interfere with the consummation of the sale in favor of PAL.
“5. The creditors present agreed to the formation of the working committee to supervise the preservation
of the properties of the corporation and agreed further that Mr. Fitzgerald shall represent the creditors as a
whole in this committee. It was understood, however, that all questions relating to preference of claims
can be decided only by the creditors assembled.
“6. It was the sense of the persons present that, if possible, the insolvency court be avoided but that
should the creditors not meet in agreement, then all the profits from the sale will be submitted to an
insolvency court for proper division among the creditors.”
To this working committee, Mr. Desmond Fitzgerald, Credit Manager, of the Defendant, Atty. Agcaoili
of the National Airports Corporation and Atty. Alexander Sycip (Exhs. III and PPP, par. 5 — P.
Agcaoili’s memorandum dated August 7, 1948, to the General Manager of the National Airports (Corp.)
were appointed. After the creditors present knew the balance sheet and heard the explanations of the
officers of the CALI, it was their unanimous opinion that it would be advantageous not to present suits
against this corporation but to strive for a fair pro-rata division of its assets (Exh. MM, par 6, Memo of
meeting), although the management of the CALI announced that in case of non-agreement of the creditors
on a pro-rata division of the assets, it would file insolvency proceedings (p. 70, t.s.n., October 22, 1951).
Mr. Fitzgerald did not decline the nomination to form part of said working committee and on August 9,
1948, the 3 members thereof discussed methods of achieving the objectives of the committee as decided
at the creditors’ meeting, which were to preserve the assets of the CALI and to study the way of making a
fair division of all the assets among the creditors. Atty. Sycip made an offer to Mr. D. Fitzgerald to name
a representative to oversee the preservation of the assets of the CALI, but Mr. Fitzgerald replied that the
creditors could rely on Col. Lambert. Atty. Pacifico Agcaoili promised to refer the arguments adduced at
the second meeting to the General Manager of the National Airports Corporations and to obtain the advice
of the Corporate Counsel, so the negotiation with respect to the division of assets of the CALI among the
creditors was left pending or under advice when on that very day of the meeting of the working
committee, August 9, 1948, which Mr. Fitzgerald attended, Defendant effected a telegraphic transfer of
its credit against the CALI to the American corporation Shell Oil Company, Inc., assigning its credit,
amounting to $79,440.00, which was subsequently followed by a deed of assignment of credit dated
August 10, 1948, the credit amounting this time to the sum of $85,081.29 (Exh. I).
On August 12, 1948, the American corporation Shell Oil Company, Inc., filed a complaint against the
CALI in the Superior Court of the State of California, U.S.A. in and for the County of San Bernardino,
for the collection of an assigned credit of $79,440.00 — Case No. 62576 of said Court (Exhs. A, E, F, G,
H, V, and Z) and a writ of attachment was applied for and issued on the same date against a C-54 plane
(Exhs. B, C, D, Y, W, X, and X-1).
On September 17, 1948, an amended complaint was filed to recover an assigned credit of $85,081.29
(Exhs. I, K, L, M, Q, R, S, T, U, DD) and a supplemental attachment for a higher sum was applied for and
issued against the C-54 plane, plus miscellaneous personal properties held by Pacific Overseas Air Lines
for the CALI (Exhs. N, O, P, AA, BB, BB-1 and CC) and on January 5, 1949, a judgment by default was
entered by the American court (Exhs. J, EE, FF, GG, and HH).
Unaware of Defendant’s assignments of credit and attachment suit, the stockholders of CALI resolved in
a special meeting of August 12, 1948, to approve the memorandum agreement of sale to the Philippine
Air Lines, Inc, and noted “that the Board had been trying to reach an agreement with the creditors of the
corporation to prevent insolvency proceedings, but so far no definite agreement had been reached” (Exh.
OO — Minutes of August 12, 1948, stockholders’ meeting).
By the first week of September, 1948, the National Airports Corporation learned of Defendant’s action in
the United States and hastened to file its own complaint with attachment against the CALI in the Court of
First Instance of Manila (Exhs. KKK, LLL, and MMM). The CALI, also prompted by Defendant’s action
in getting the alleged undue preference over the other creditors by attaching the C-54 plane in the United
States, beyond the jurisdiction of the Philippines, filed on October 7, 1948, a petition for voluntary
insolvency. On this date, an order of insolvency was issued by the court (Exh. JJ) which necessarily
stayed the National Airports Corporation’s action against the CALI and dissolved its attachment (Exh.
NNN), thus compelling the National Airports Corporation to file its claims with the insolvency court
(Exh. SS).
By order of October 28, 1948, the Court confirmed the appointment of Mr. Alfredo M. Velayo, who was
unanimously elected by the creditors as Assignee in the proceedings, and ordered him to qualify as such
by taking the oath of office within 5 days from notice and filing a bond in the sum of P30,000.00 to be
approved by the Court conditioned upon the faithful performance of his duties, and providing further that
all funds that the Assignee may collect or receive from the debtors of the corporation, or from any other
source or sources, be deposited in a local bank (Exh. KK). On November 3, 1948, the clerk of court
executed a deed of conveyance in favor of the Assignee (Alfredo M. Velayo) over all the assets of the
CALI (Exh. LL).
The Case. — After properly qualifying as Assignee, Alfredo M. Velayo instituted this case (No. 6966 of
the Court of First Instance of Manila) on December 17, 1948, against the Shell Company of P. I., Ltd., for
the purpose of securing from the Court a writ of injunction restraining Defendant, its agents, servants,
attorneys and solicitors from prosecuting in and for the County of San Bernardino in the Superior Court
of the State of California, U.S.A. the aforementioned Civil Case No. 62576 against the insolvent
Commercial Air Lines, Inc., begun by it in the name of the American corporation Shell Oil Company,
Inc., and as an alternative remedy, in case the purported assignment of Defendant’s alleged credit to the
American corporation Shell Oil Company, Inc., and the attachment issued against CALI in the said
Superior Court of California shall have the effect of defeating the procurement by Plaintiff as Assignee in
insolvency of the above- mentioned airplane, which is the property of the insolvent CALI, situated in the
Ontario International Airport, with in the County of San Bernardino, State of California, U.S.A., that
judgment for damages in double the value of the airplane be awarded in favor
of Plaintiff against Defendant, with costs.
The complaint further prays that upon the filing of a bond executed to the Defendant in an amount to be
fixed by the Court, to the effect that Plaintiff will pay to Defendant all damages the latter may sustain by
reason of the injunction if the Court should finally decide that the Plaintiffwas not entitled thereto, the
Court issued a writ of preliminary injunction enjoining theDefendant, its agent, servants, attorney’s and
solicitor, from prosecuting the aforementioned case No. 62576, the same writ of preliminary injunction to
issue without notice to the Defendant it appearing by verified complaint that the great irreparable injury
will result to the Plaintiff-Appellant before the matter could be on notice. The Plaintiff also prays for such
other remedies that the Court may deem proper in the premises.
On December 20, 1948, the Defendant filed an opposition to the Plaintiff’s petition for the issuance of a
writ of the preliminary injunction, and on December 22, 1948, the Court denied the same because whether
the conveyance of Defendant’s credit was fraudulent or not, the Philippine court would not be in position
to enforce its orders as against the American corporation Shell Oil Company, Inc., which is outside of the
jurisdiction of the Philippines.
Plaintiff having failed to restrain the progress of the attachment suit in the United States by denial of his
application for a writ of preliminary injunction and the consequences on execution of the C-54 plane in
the County of San Bernardino, State of California, U. S. A., he confines his action to the recovery of
damages against the Defendant.
On December 28, 1948, Defendant filed its answer to the complaint, which was amended on February 3,
1949. In its answer, Defendant, besides denying certain averments of the complaint alleged, among other
reasons, that the assignment of its credit in favor of the Shell Oil Company, Inc., in the United States was
for a valuable consideration and made in accordance with the established commercial practices, there
being no law prohibiting a creditor from assigning his credit to another; chan roblesvirtualawlibrarythat it
had no interest whatsoever in Civil Case No. 62576 instituted in the Superior Court in the State of
California by the Shell Oil Company, Inc., which is a separate and distinct corporation organized and
existing in the State of Virginia and doing business in the State of California, U. S. A.,
the Defendant having as its stockholders the Shell Petroleum Company of London and other persons
residing in that City, while the Shell Oil Company Inc., of the United State has its principal stockholders
the Shell Union Oil Company of the U.S. and presumably countless American investors inasmuch as its
shares of stock are being traded daily in the New York stock market; chan roblesvirtualawlibrarythat Mr.
Fitzgerald, Defendant’s Credit Manager, was merely invited to a luncheon-meeting at the Trade and
Commerce Building in the City of Manila on August 6, 1948, without knowing the purpose for which it
was called; chan roblesvirtualawlibraryand that Mr. Fitzgerald could not have officially represented
the Defendant at that time because such authority resides on Mr. Stephen Crawfurd. Defendant, therefore,
prays that the complaint be dismissed with costs against thePlaintiff.
Then Alfonso Sycip, Yek Hua Trading Corporation and Paul Sycip, as well as Mabasa & Co., filed, with
permission of the Court, their respective complaints in intervention taking the side of thePlaintiff. These
complaints in intervention were timely answered by Defendant which prayed that they be dismissed.
After proper proceedings and hearing, the Court rendered decision on February 26, 1954, dismissing the
complaint as well as the complaints in intervention, with costs against the Plaintiff. In view of this
outcome, Plaintiff comes to us praying that the judgment of the lower court be reversed and that
the Defendant be ordered to pay him damages in the sum of P660,000 (being double the value of the
airplane as established by evidence, i.e., P330,000), with costs, and for such other remedy as the Court
may deem just and equitable in the premises.
The Issues. — Either admission of the parties, or by preponderance of evidence, or by sheer weight of the
circumstance attending the transactions herein involved, We find that the facts narrated in the preceding
statement of the “antecedents” have been sufficiently established, and the questions at issue submitted to
our determination in this instance may be boiled down to the following
propositions:chanroblesvirtuallawlibrary
(1) Whether or not under the facts of the case, the Defendant Shell Company of the P. I., Ltd., taking
advantage of its knowledge of the existence of CALI’s airplane C-54 at the Ontario International Airport
within the Country of San Bernardino, State of California, U. S. A.,
(Which knowledge it acquired:chanroblesvirtuallawlibrary first at the informal luncheon-meeting of the
principal creditors of CALI on August 5, 1948, where its Credit Manager, Mr. Desmond Fitzgerald, was
selected to form part of the Working Committee to supervise the preservation of CALI’s properties and to
study the way of making a fair division of all the assets among the creditors and thus avoid the institution
of insolvency proceedings in court; chan roblesvirtualawlibraryand
Subsequently, at the meeting of August 9, 1948, when said Mr. Fitzgerald met the other members of the
said Working Committee and heard and discussed the contention of certain creditors of CALI — on the
accounts due the employees, the Government and the National Airports Corporation — who alleged that
their claims were preferred),
acted in bad faith and betrayed the confidence and trust of the other creditors of CALI present in said
meeting by affecting a hasty telegraphic transfer of its credit to the American corporation Shell Oil
Company, Inc., for the sum of $79,440 which was subsequently followed by a deed of assignment of
credit dated August 10, 1948, amounting this time to the sum of $85,081.28 (Exhs. Z), thus defeating the
purpose of the informal meetings of CALI’s principal creditors end depriving the Plaintiff, as its
Assignee, of the means of obtaining said C-54 plane, or the value thereof, to the detriment and prejudice
of the other CALI’s creditors who were consequently deprived of their share in the distribution of said
value; chan roblesvirtualawlibraryand (2) Whether or not by reason of said betrayal of confidence and
trust, Defendant may be made under the law to answer for the damages prayed by the Plaintiff; chan
roblesvirtualawlibraryand if so, what should be the amount of such damages.
DISCUSSION OF THE CONTROVERSY
I. The mere enunciation of the first proposition can lead to no other conclusion than thatDefendant, upon
learning the precarious economic situation of CALI and that with all probability, it could not get much of
its outstanding credit because of the preferred claims of certain other creditors, forgot that “Man does not
live by bread alone” and entirely disregarded all moral inhibitory tenets. So, on the very day its Credit
Manager attended the meeting of the Working Committee on August 9, 1948, it hastily made a
telegraphic assignment of its credit against the CALI to its sister American Corporation, the Shell Oil
Company, Inc., and by what is stated in the preceding pages hereof, We know that were the damaging
effects of said assignment upon the right of other creditors of the CALI to participate in the proceeds of
said CALI’s plane C-54.
Defendants endeavor to extricate itself from any liability caused by such evident misdeed of its part,
alleging that Mr. Fitzgerald had no authority from his principal to commit the latter on any
agreement; chan roblesvirtualawlibrarythat the assignment of its credit in favor of its sister corporation,
Shell Oil Company, Inc., was for a valuable consideration and in accordance with the established
commercial practices; chan roblesvirtualawlibrarythat there is no law prohibiting a creditor from
assigning his credit to another; chan roblesvirtualawlibraryand that the Shell Oil Company Inc., of the
United States is a corporation different and independent from the Defendant. But all these defenses are
entirely immaterial and have no bearing on the main question at issue in this appeal. Moreover, we might
say that Defendant could not have accomplished the transfer of its credit to its sister corporation if all the
Shell companies throughout the world would not have a sort of union, relation or understanding among
themselves to come to the aid of each other. The telegraphic transfer made without knowledge and at the
back of the other creditors of CALI may be a shrewd and surprise move that enabledDefendant to collect
almost all if not the entire amount of its credit, but the Court of Justice cannot countenance such attitude
at all, and much less from a foreign corporation to the detriment of our Government and local business.
To justify its actions, Defendant may also claim that Mr. Fitzgerald, based on his feeling of distrust and
apprehension, entertained the conviction that intervenors Alfonso Sycip and Yek Hua Trading
Corporation tried to take undue advantage by infiltrating their credits. But even assuming for the sake of
argument, that these intervenors really resorted to such strategem or fraudulent device, yet Defendant’s
act finds not justification for no misdeed on the part of a person is cured by any misdeed of another, and it
is to be noted that neither Alfonso Z. Sycip, nor Yek Hua Trading Corporation were the only creditors of
CALI, nor even preferred ones, and that the infiltration of one’s credit is of no sequence if it cannot be
proven in the insolvency proceedings to the satisfaction of the court. Under the circumstances of the
case, Defendant’s transfer of its aforementioned credit would have been justified only if Mr. Fitzgerald
had declined to take part in the Working Committee and frankly and honestly informed the other creditors
present that he had no authority to bind his principal and that the latter was to be left free to collect its
credit from CALI by whatever means his principal deemed wise and were available to it. But then such
information would have immediately dissolved all attempts to come to an amicable conciliation among
the creditors and would have precipitated the filing in court of CALI’s voluntary insolvency proceedings
and nulified the intended transfer of Defendant’s credit to its above-mentioned sister corporation.
II. We may agree with the trial judge, that the assignment of Defendant’s credit for a valuable
consideration is not violative of the provisions of sections 32 and 70 of the Insolvency Law (Public Act
No. 1956), because the assignment was made since August 9, 1948, the original complaint in the United
States was filed on August 12, 1948, and the writ of attachment issued on this same date, while CALI
filed its petition for insolvency on October 7, 1948. At his Honor correctly states, said Sections 32 and 70
only contemplate acts and transactions occuring within 30 days prior to the commencement of the
proceedings in insolvency and, consequently, all other acts outside of the 30-day period cannot possibly
be considered as coming within the orbit of the operation. In addition to this, We may add that Article 70
of the Insolvency Law refers to acts of the debtor (in this case the insolvent CALI) and not of the creditor,
the Shell Company of the P. I. Ltd. But section 70 does not constitute the only provisions of the law
pertinent to the matter. The Insolvency Law also provides the following:chanroblesvirtuallawlibrary
“SEC. 33. The assignee shall have the right to recover all the estate, debt and effects of said insolvent. If
at the time of the commencement of the proceedings in insolvency, an action is pending in the name of
the debtor, for the recovery of a debt or other thing might or ought to pass to the assignee by the
assignment, the assignee shall be allowed to prosecute the action, in like manner and with life effect as if
it had been originally commenced by him. If there are any rights of action in favor of the insolvency for
damages, on any account, for which an action is not pending the assignee shall have the right to prosecute
the same with effect as the insolvent might have done himself if no proceedings in insolvency had been
instituted cralaw .”
It must not be forgotten that in accordance with the spirit of the Insolvency Law and with the provisions
of Chapter V thereof which deal with the powers and duties of a receiver, the assignee represents the
insolvent as well as the creditors in voluntary and involuntary proceedings — Intestate of Mariano G.
Veloso, etc. vs. Vda. de Veloso S. C. — G. R. No. 42454; chan roblesvirtualawlibraryHunter, Kerr & Co.
vs. Samuel Murray, 48 Phil. 449; chan roblesvirtualawlibraryChartered Bank vs. Imperial, 48 Phil.
931; chan roblesvirtualawlibraryAsia Banking Corporation vs. Herridge, 45 Phil. 527 — (II Tolentino’s
Commercial Laws of the Philippines, 633). See also Section 36 of the Insolvency Law.From the
foregoing, We see that Plaintiff, as Assignee of the Insolvent CALI, had personality and authority to
institute this case for damages, and the only question that remains determination is whether the payment
of damages sought to be recovered from Defendant may be ordered under the Law and the evidence of
record.
IF ANY PERSON, before the assignment is made, having notice of the commencement of the
proceedings in insolvency, or having reason to believe that insolvency proceedings are about to be
commenced, embezzles or disposes of any money, goods, chattels, or effects of the insolvent, he is
chargeable therewith, and liable to an action by the assignee for double the value of the property sought to
be embezzled or disposed of, to be received for the benefit of the insolvent estate.
The writer of this decision does not entertain any doubt that the Defendant — taking advantage of his
knowledge that insolvency proceedings were to be instituted by CALI if the creditors did not come to an
understanding as to the manner of distribution of the insolvent asset among them, and believing it most
probable that they would not arrive at such understanding as it was really the case — schemed and
effected the transfer of its sister corporation in the United States, where CALI’s plane C-54 was by that
swift and unsuspected operation efficaciously disposed of said insolvent’s property depriving the latter
and the Assignee that was latter appointed, of the opportunity to recover said plane. In addition to the
aforementioned Section 37, Chapter 2 of the PRELIMINARY TITLE of the Civil Code, dealing on
Human Relations, provides the following:chanroblesvirtuallawlibrary
“Art 19. Any person must, in the exercise of his rights and in the performances of his duties, act with
justice, give everyone his due and observe honesty and good faith”.
It maybe said that this article only contains a mere declarations of principles and while such statement
may be is essentially correct, yet We find that such declaration is implemented by Article 21 and
sequence of the same Chapter which prescribe the following:chanroblesvirtuallawlibrary
“Art. 21. Any person who wilfully causes loss or injury to another in a manner that is contrary to morals,
good customs or public policy shall compensate the latter for the damage”.
The Code Commission commenting on this article, says the following:chanroblesvirtuallawlibrary
“Thus at one stroke, the legislator, if the forgoing rule is approved (as it was approved), would vouchsafe
adequate legal remedy for that untold numbers of moral wrongs which is impossible for human foresight
to provide for specifically in the statutes.
“But, it may be asked, would this proposed article obliterate the boundary line between morality and law?
The answer is that, in the last analysis, every good law draws its breath of life from morals, from those
principles which are written with words of fire in the conscience of man. If this premises is admitted, then
the proposed rule is a prudent earnest of justice in the face of the impossibility of enumerating, one by
one, all wrongs which cause damages. When it is reflected that while codes of law and statutes have
changed from age to age, the conscience of man has remained fixed to its ancient moorings, one cannot
but feel that it is safe and salutary to transmute, as far as may be, moral norms into legal rules, thus
imparting to every legal system that enduring quality which ought to be one of its superlative attributes.
“Furthermore, there is no belief of more baneful consequence upon the social order than that a person
may with impunity cause damage to his fellow-men so long as he does not break any law of the State,
though he may be defying the most sacred postulates of morality. What is more, the victim loses faith in
the ability of the government to afford him protection or relief.
“A provision similar to the one under consideration is embodied in article 826 of the German Civil Code.
“The same observations may be made concerning injurious acts that are contrary to public policy but are
not forbidden by statute. There are countless acts of such character, but have not been foreseen by the
lawmakers. Among these are many business practices that are unfair or oppressive, and certain acts of
landholders and employers affecting their tenants and employees which contravene the public policy of
social justice.
“Another rule is expressed in Article 24 which compels the return of a thing acquired ‘without just or
legal grounds’. This provision embodies the doctrine that no person should unjustly enrich himself at the
expense of another, which has been one of the mainstays of every legal system for centuries. It is most
needful that this ancient principles be clearly and specifically consecrated in the proposed Civil Code to
the end that in cases not foreseen by the lawmaker, no one may unjustly benefit himself to the prejudice
of another. The German Civil Code has a similar provision (art. 812).” (Report of the Code Commission
on the Proposed Civil Code of the Philippines, p. 40- 41).
From the Civil Code Annotated by Ambrosio Padilla, Vol. I, p. 51, 1956 edition, We also copy the
following:chanroblesvirtuallawlibrary
“A moral wrong or injury, even if it does not constitute a violation of a statute law, should be
compensated by damages. Moral damages (Art. 2217) may be recovered (Art. 2219). In Article 20, the
liability for damages arises from a willful or negligent act contrary to law. In this article, the act is
contrary to morals, good customs or public policy.”
Now, if Article 23 of the Civil Code goes as far as to provide that:chanroblesvirtuallawlibrary
“Even if an act or event causing damage to another’s property was not due to the fault or negligence of
the Defendant, the latter shall be liable for indemnity if through the act or event he was benefited.”
with mere much more reason the Defendant should be liable for indemnity for acts it committed in bad
faith and with betrayal of confidence.
It may be argued that the aforequoted provisions of the Civil Code only came into effect on August 30,
1950, and that they cannot be applicable to acts that took place in 1948, prior to its effectivity. But Article
2252 of the Civil Code, though providing that:chanroblesvirtuallawlibrary
“Changes made and new provisions and rules laid down by this Code which may be prejudice or impair
vested or acquired rights in accordance with the old legislation, shall have no retroactive effect cralaw .”
implies that when the new provisions of the Code does nor prejudice or impair vested or acquired rights in
accordance with the old legislation — and it cannot be alleged that in the case at barDefendant had any
vested or acquired right to betray the confidence of the insolvent CALI or of its creditors — said new
provisions, like those on Human Relations, can be given retroactive effect. Moreover, Article 2253 of the
Civil Code further provides:chanroblesvirtuallawlibrary
“ cralaw But if a right should be declared for the first time in this Code, it shall be effective at once, even
though the act or event which may give rise thereto may have been done or may have occurred under the
prior legislation, provided said new right does not prejudice or impair any vested or acquired right, of the
same origin.”
and according to Article 2254, “no vested or acquired right can arise from acts or omissions which are
against the law or which infringe upon the right of others.”
In case of Juan Castro vs. Acro Taxicab Company, (82 Phil., 359; chan roblesvirtualawlibrary47 Off.
Gaz., [5] 2023), one of the question at issue was whether or not the provisions of the New Civil Code of
the Philippines on moral damages should be applied to an act of negligence which occurred before the
effectivity of said code, and this Court, through Mr. Justice Briones, sustaining the affirmative
proposition and citing decisions of the Supreme Court of Spain of February 14, 1941, and November 14,
1934, as well as the comment of Mr. Castan, Chief Justice of the Supreme Court of Spain, about the
revolutionary tendency of Spanish jurisprudence, said the following:chanroblesvirtuallawlibrary
“We conclude, therefore, reaffirming the doctrine laid down in the case of Lilius (59 J. F. 800) in the
sense that indemnity lies for moral and patrimonial damages which include physical and pain sufferings.
With this (doctrine), We effect in this jurisdiction a real symbiosis 1 of the Spanish and American Laws
and, at the same time, We act in consonance with the spirit and progressive march of time” (translation)
The writer of this decision does not see any reason for not applying the provisions of Section 37 of the
Insolvency Law to the case at bar, specially if We take into consideration that the term “any person” used
therein cannot be limited to the officers or employee of the insolvent, as no such limitation exist in the
wording of the section (See also Sec. 38 of the same Act), and that, as stated before,
the Defendant schemed and affected the transfer of its credits (from which it could derive practically
nothing) to its sister corporation in the United States where CALI’s plane C-54 was then situated,
succeeding by such swift and unsuspected operation in disposing of said insolvent’s property by
removing it from the possession and ownership of the insolvent. However, some members of this Court
entertain doubt as to the applicability of said section 37 because in their opinion what Defendant in reality
disposed of was its own credit and not the insolvent’s property, although this was practically the effect
and result of the scheme. Having in mind this objection and that the provisions of Article 37 making the
person coming within its purview liable for double the value of the property sought to be disposed
of constitute a sort of penal clause which shall be strictly construed, and considering further that the same
result may be obtained, by applying only the provisions of the Civil Code, the writer of this decision
yields to the objection aforementioned.
Articles 2229, 2232, 2234, 2142, and 2143 of the Civil Code read as follows:chanroblesvirtuallawlibrary
“Art. 2229. Exemplary or corrective damages are imposed, by way of example or correction for the
public good, in addition to the moral, temperate, liquidated or compensatory damages.”
“Art. 2232. In contracts quasi-contracts, the Court may award exemplary damages if theDefendant acted
in a wanton, fraudulent, reckless, oppressive, or malevolent manner.”
“Art. 2234. While the amount of the exemplary damages need not be proved, the Plaintiff must show that
he is entitled to moral, temperate, or compensatory damages before the court may consider the question of
whether or not exemplary damages should be awarded. In case liquidated damages should be upon,
although no proof of loss is necessary in order that such liquidated damages be recovered, nevertheless,
before the court may consider the question of granting exemplary in addition to the liquidated damages,
the Plaintiff must show that he would be entitled to moral, temperate or compensatory damages were it
not for the stipulation for liquidated damages.”
“Art. 2142. Certain lawful, voluntary and unilateral acts give rise to the juridical relation of quasi-
contract to the end that no one shall be unjustly enriched or benefited at the expense of another.”
“Art, 2143. The provisions for quasi-contracts in this Chapter do not exclude other quasi-contracts which
may come within the purview of the preceding article.”
In accordance with these quoted provisions of the Civil Code, We hold Defendant liable to pay to
the Plaintiff, for the benefit of the insolvent CALI and its creditors, as compensatory damages a sum
equivalent to the value of the plane at the time aforementioned and another equal sum as exemplary
damages.
There is no clear proof in the record about the real value of CALI’s plane C-54 at the time
whenDefendant’s credit was assigned to its sister corporation in the United States.
Judgment
Wherefore, and on the strength of the foregoing considerations, the decision appealed from is reversed
and Defendant-Appellee-, Shell Company of the Philippine Islands, Ltd., is hereby sentenced to pay
to Plaintiff-Appellant, as Assignee of the insolvent CALI, damages in a sum double the amount of the
value of the insolvent’s airplane C-54 at the time Defendant’s credit against the CALI was assigned to its
sister corporation in the United States, which value shall be determined in the corresponding incident in
the lower court after this decision becomes final. Costs are taxed against Defendant-Appellee. It is SO
ORDERED.
Paras, C.J., Padilla, Montemayor, Bautista Angelo, Labrador, Concepcion, Reyes, J. B. L., and
Endencia, concur.

RESOLUTION
July 30, 1957

FELIX, J.:
Plaintiff-Appellant and intervenors on one hand and Defendant Shell Company of the Philippine Islands,
Ltd., on the other, have filed their respective motions for reconsideration of Our decision rendered in this
case. The motion of Plaintiff Appellant and the intervenors seeks the reconsideration of said decision in so
far as it held that:chanroblesvirtuallawlibrary
“There is no clear proof in the record about the real value of CALI’s plane C-54, at the time
whenDefendant’s credit was assigned to its sister corporation in the United States.”
and, upon such holding, it orders that the value of the C-54 plane —
“be determined in the corresponding incident in the lower Court after this decision becomes final.”
The movants maintain that there is evidence sufficient to support a finding that CALI’s C-54 plane had a
fair market value of $165,000 at or about the time Defendant credit was assigned to its sister corporation
in the United States and the plane attached. This motion was opposed byDefendant-Appellee which was
replied by Plaintiff- Appellant with a supplemental motion for reconsideration, and then retorted with a
manifestation and motion of Defendant-Appellantfollowed by Defendant’s answer to Plaintiff’s motion
for reconsideration.
After considering the evidence pointed out by said parties in support of their respective contentions, we
are more convinced that the proofs relative to the real value of CALI plane C-54 at the time Defendant’s
credit was assigned to its sister corporation in the United States, is not clear. Hence, Plaintiff-Appellant’s
and intervenors’ motion for reconsideration is hereby overruled.
The main grounds on which Defendant-Appellee bases its motion for reconsideration, as relied upon in its
counsel’s memoranda and oral argument, may be reduced to the following:chanroblesvirtuallawlibrary
(1) That the Defendant Appellee is not guilty of bad faith, it having done nothing but to protect
legitimately its own interest or credit against the bad faith of its debtor, the insolvent CALI, under the
control of the latter’s President Alfonso Sycip;
(2) That Appellee’s transfer of its credit to its sister corporation in the United States, did not prejudice the
Government, because its claims were fully paid, nor caused any loss or injury to other creditors, except
the entities and groups controlled by Alfonso Z. Sycip;
(3) That Appellee is not liable for exemplary damages because the provisions of the new Civil Code on
the matter are not applicable to this case;
(4) That the Plaintiff-Appellant has no cause of action against Defendant-Appellant and is not the real
party in interest; chan roblesvirtualawlibraryand
(5) That Plaintiff’s right of action was based and prosecuted in the lower court under the provisions of
the Insolvency Law and consequently that he is stopped from pursuing another theory and is not entitled
to damages under the provisions of the New Civil Code.
I. The facts on which this Court based its conclusion that Defendant corporation acted in bad faith are
plainly and explicitly narrated in the decision. They are not and cannot be denied or contradicted by
said Defendant. On the contrary they are in many respects admitted by theDefendant and no amount of
reasoning can make Us change that conclusion.
II. As pointed out by counsel for Plaintiff, Defendant choses to ignore that besides the claims of
intervenors Alfonso Z. Sycip and Yek Hua Trading Corporation, which counsel for the Shell says to
constitute 10/11 of the approved ordinary claims, there is still 1/11 of the other creditors whose claims
have been also approved by the insolvency Court, in addition to the ordinary creditors whose claims are
yet unapproved by the insolvency Court, amounting to P560,296,32, and “no good reason suggests itself
why these unapproved but pending claims should be taken into account in considering the prejudice
caused all the creditors of the insolvent CALI. As long as these claims are pending, the contingency exist,
that these creditors may recover from the insolvent estate and when they do, they will suffer to the
diminution of CALI’s asset resulting from the attachment of the plane by Appellee Shell.”
Answering Defendant’s contention that the transfer of its credit to its sister corporation in the United
States did not prejudice the Government or the other creditors of CALI, counsel forPlaintiff-Appellant has
the following to say:chanroblesvirtuallawlibrary
“So far as the claims of the Government are concerned, it is true that they were preferred claims and have
all been paid. But this circumstance cannot erase the fact that the Appellee’s action jeopardised the
Government’s claims as well as the other claims. There was doubt as to the preferential character of the
Government’s claims. Indeed, the preferential character of one of the Government’s claims necessitated a
litigation to establish. Had it been held to be an ordinary claim, the Government would have suffered as
other creditors. But that is neither here nor there; chan roblesvirtualawlibraryneither the character of the
claim nor the identity of the claimant can possibly affect the application of a principle that no person may
profit from his betrayal of a trust.”
And the Appellant continues thus:chanroblesvirtuallawlibrary
“Appellee had a credit of P170,000 against the insolvent CALI as of August 1948, which is assigned to its
sister corporation in the United States for P120.000. Hence, Appellee recovered 70% of its credit and
immediately upon making the assignment in 1948. More than this, the stated consideration was fixed by
and and between two sister companies. The fact remains thatAppellee’s sister company was enabled to get
hold of a C-54 plane worth about P330,000.
“On the other hand, the ordinary creditors who filed their claims against the insolvent CALI had to wait
until November 1956 to get their dividends and only at the rate of 30%, computed as
follows:chanroblesvirtuallawlibrary
Assets as of October 30, 1956 P668,605.15
Less:chanroblesvirtuallawlibrary
Preferred claims still uncollected,
assignee and attorney’s fees and
other reserves P138,719.56
—————
Amount available for distribution P529,885.59
Divident:chanroblesvirtuallawlibrary
Amount available for distribution P529,885.59
————— = 30%
Total of all ordinary claims approved
and unapproved P1,746,222.33
Had Appellee not assigned its credit in 1948, the insolvent CALI would have realized from the sale of the
plane (which was attached by Appellee) P330,000 representing the fair market value of the plane at the
time of the attachment. Therefore, if this amount of P330,000 is added to the distributable amount of
P529,- 885.59, the share of each of the ordinary creditos would certainly amount to approximately 1 1/2
times the dividend each of them has received; chan roblesvirtualawlibraryin other words, each ordinary
creditors would received not 30% but approximately 45% of his claim, and Appelleewould recover
approximately only 45% and not 70% of its credit.”
And even if the sale of CALI’s plane would not have obtained the sum of P330,000.00, the proceeds
thereof that might be diminished though affecting, no doubt, the calculated dividend of each of the
ordinary creditors, estimated at 45% by reducing it proportionately, such diminution would at the same
time increase the difference between the dividend paid CALI’s ordinary creditors in November, 1956, and
the dividend of 70% secured by Defendant Shell in 1948.
III and IV. That Appellee Shell is not liable for exemplary damages in this case and that Plaintiff-
Appellant has no cause of action against Defendant-Appellee, for he is not the real party in interest, are
matters fully discussed in Our decision and We find no sensible reason for disturbing the conclusions We
reached therein.
V. As to the fifth question raised by counsel for Appellee in the course of his oral argument at the hearing
in the City of Baguio of his motion, i.e., “that Plaintiff’s right of action was based and prosecuted in the
lower court under the provisions of the Insolvency Law and he is, therefore, stopped from pursuing on
appeal another theory under which he might be entitled to damages in consonance with the provisions of
the new Civil Code”, We may invoke the decision in the case of Dimaliwat vs. Asuncion, 59 Phil., 396,
401. In that decision We said the following:chanroblesvirtuallawlibrary
“Vicente Dimaliwat contends that Esperanza Dimaliwat has no right to claim the ownership of the
property in question to the exclusion of the children of the third marriage, under the foregoing provisions
of the Civil Code, because the case was not tried on that theory in the lower court. We find no merit in
that contention. The decision cited are not in point. Articles 968 and 969 of the Civil Code are rules of
substantive law, and if they are applicable to the facts of this case they must be given effect.”
The same thing can be said in the case at bar. Articles 19, 21, 2229, 2232, 2234, 2142 and 2143 of the
new Civil Code are rules of substantive law, and if they are applicable to the facts of this case, which We
hold they do, they must be made operative and given effect in this litigation.
xxx xxx xxx
It maybe seen from the foregoing that the above mentioned grounds on which the motion for
reconsideration of the Defendant Shell stand, are not well taken. However, and despite this finding, We
insist to delve in the question of whether the exemplary damages imposed in this Court
upon Defendant Appellee, which the latter’s counsel contends to be inequitable and unfair, may be
modified.
It will be remembered that this case was looked into from the point of view of the provisions of Section
37 of the Insolvency Law, which reads as follows:chanroblesvirtuallawlibrary
SEC. 37. IF ANY PERSON, before the assignment is made, having notice of the commencement of the
proceedings in insolvency, or having reason to believe that insolvency proceedings are about to be
commenced, embezzles or disposses of any of the money, goods, chattels, or effects of the insolvent, he is
chargeable therewith, and liable to an action by the assignee for double the value of the property sought to
be embezzled or disposed of, to be received for the benefit of the insolvent estate.
The writer of the decision was then and still is of the opinion that the provisions of this section were
applicable to the case, and accordingly, that Defendant Shell was liable in this action instituted by the
Assignee for double the value of the property disposed of, to be received for the benefit of the Insolvent
estate. However, some of the members of this Court, for the reasons already stated in the decision,
entertained some doubt as to the applicability of said Section 37, and yielding to their objections the
writer of the decision turned his eyes to the provisions of the new Civil Code, inasmuch as the same result
could be achieved. In the case at bar, it cannot be denied that:chanroblesvirtuallawlibrary
“Defendant — taking advantage of his knowledge that insolvency proceedings were to be instituted by
CALI if the creditors did not come to an understanding as to the manner of distribution of the insolvent
assets among them, and believing as most probable that they would not arrive at such understanding, as it
was really the case- schemed and effected the transfer of its credit to its sister corporation in the United
States where CALI’s plane C-54 was and by this swift and unsuspected operation efficaciously disposed
of said insolvent’s property depriving the latter and the Assignee that was later appointed, of the
opportunity to recover said plane.”
These acts of Defendant Shell come squarely within the sanction prescribed by Congress by similar acts
and no reflection can be reasonably cast on Us if in the measure of the exemplary damages that were to be
imposed upon Defendant-Appellee, We were influenced by the provisions of Section 37 of the Insolvency
Law. In this connection it is to be noted that, according to the Civil Code, exemplary or corrective
damages are imposed by way of example or correction for the public good, in addition of the moral,
temperate, liquidated or compensatory damages Art. 2229, and that the amount of the exemplary damages
need not be proved (Art. 2234), for it is left to the sound discretion of the Court.
Notwithstanding the foregoing, a majority of this Court was of the belief that the value of CALI’s plane
C-54, at the time when Defendant’s credit was assigned to its sister corporation in the United States,
might result quite high, and that exemplary damages should not be left to speculation but properly
determined by a certain and fixed amount. So they voted for the reconsideration of the decision with
regard to the amount of exemplary damages which this Court fixed at P25,000.00.
Because of this attitude of the Court, the dispositive part of our decision rendered in this case is hereby
amended to read as follows:chanroblesvirtuallawlibrary
Wherefore, and on the strength of the foregoing considerations, the decision appealed from is reversed
and Defendant-Appellee, Shell Company of the Philippine Islands Ltd., is hereby sentenced to
pay Plaintiff-Appellant, as Assignee of the insolvent CALI, compensatory damages in a sum equal to the
value of the insolvent’s airplane C-54 at the time Defendant’s credit against CALI was assigned to its
sister corporation in the United States - which shall be determined in the corresponding incident in the
lower Court after this decision becomes final - and exemplary damages in the sum of P25,000. Costs are
taxed against Defendant-Appellee. It is SO ORDERED.
Parás, C.J., Padilla, Concepcion and Endencia, JJ., concur.

Republic of the Philippines


SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 81262 August 25, 1989

GLOBE MACKAY CABLE AND RADIO CORP., and HERBERT C. HENDRY, petitioners,
vs.
THE HONORABLE COURT OF APPEALS and RESTITUTO M. TOBIAS, respondents.

Atencia & Arias Law Offices for petitioners.

Romulo C. Felizmena for private respondent.

CORTES, J.:

Private respondent Restituto M. Tobias was employed by petitioner Globe Mackay Cable and Radio
Corporation (GLOBE MACKAY) in a dual capacity as a purchasing agent and administrative assistant to
the engineering operations manager. In 1972, GLOBE MACKAY discovered fictitious purchases and
other fraudulent transactions for which it lost several thousands of pesos.

According to private respondent it was he who actually discovered the anomalies and reported them on
November 10, 1972 to his immediate superior Eduardo T. Ferraren and to petitioner Herbert C. Hendry
who was then the Executive Vice-President and General Manager of GLOBE MACKAY.

On November 11, 1972, one day after private respondent Tobias made the report, petitioner Hendry
confronted him by stating that he was the number one suspect, and ordered him to take a one week forced
leave, not to communicate with the office, to leave his table drawers open, and to leave the office keys.

On November 20, 1972, when private respondent Tobias returned to work after the forced leave,
petitioner Hendry went up to him and called him a "crook" and a "swindler." Tobias was then ordered to
take a lie detector test. He was also instructed to submit specimen of his handwriting, signature, and
initials for examination by the police investigators to determine his complicity in the anomalies.

On December 6,1972, the Manila police investigators submitted a laboratory crime report (Exh. "A")
clearing private respondent of participation in the anomalies.

Not satisfied with the police report, petitioners hired a private investigator, retired Col. Jose G. Fernandez,
who on December 10, 1972, submitted a report (Exh. "2") finding Tobias guilty. This report however
expressly stated that further investigation was still to be conducted.

Nevertheless, on December 12, 1972, petitioner Hendry issued a memorandum suspending Tobias from
work preparatory to the filing of criminal charges against him.

On December 19,1972, Lt. Dioscoro V. Tagle, Metro Manila Police Chief Document Examiner, after
investigating other documents pertaining to the alleged anomalous transactions, submitted a second
laboratory crime report (Exh. "B") reiterating his previous finding that the handwritings, signatures, and
initials appearing in the checks and other documents involved in the fraudulent transactions were not
those of Tobias. The lie detector tests conducted on Tobias also yielded negative results.

Notwithstanding the two police reports exculpating Tobias from the anomalies and the fact that the report
of the private investigator, was, by its own terms, not yet complete, petitioners filed with the City Fiscal
of Manila a complaint for estafa through falsification of commercial documents, later amended to just
estafa. Subsequently five other criminal complaints were filed against Tobias, four of which were for
estafa through Falsification of commercial document while the fifth was for of Article 290 of' the Revised
Penal Code (Discovering Secrets Through Seizure of Correspondence).lâwphî1.ñèt Two of these
complaints were refiled with the Judge Advocate General's Office, which however, remanded them to the
fiscal's office. All of the six criminal complaints were dismissed by the fiscal. Petitioners appealed four of
the fiscal's resolutions dismissing the criminal complaints with the Secretary of Justice, who, however,
affirmed their dismissal.

In the meantime, on January 17, 1973, Tobias received a notice (Exh. "F") from petitioners that his
employment has been terminated effective December 13, 1972. Whereupon, Tobias filed a complaint for
illegal dismissal. The labor arbiter dismissed the complaint. On appeal, the National Labor Relations
Commission (NLRC) reversed the labor arbiter's decision. However, the Secretary of Labor, acting on
petitioners' appeal from the NLRC ruling, reinstated the labor arbiter's decision. Tobias appealed the
Secretary of Labor's order with the Office of the President. During the pendency of the appeal with said
office, petitioners and private respondent Tobias entered into a compromise agreement regarding the
latter's complaint for illegal dismissal.

Unemployed, Tobias sought employment with the Republic Telephone Company (RETELCO). However,
petitioner Hendry, without being asked by RETELCO, wrote a letter to the latter stating that Tobias was
dismissed by GLOBE MACKAY due to dishonesty.

Private respondent Tobias filed a civil case for damages anchored on alleged unlawful, malicious,
oppressive, and abusive acts of petitioners. Petitioner Hendry, claiming illness, did not testify during the
hearings. The Regional Trial Court (RTC) of Manila, Branch IX, through Judge Manuel T. Reyes
rendered judgment in favor of private respondent by ordering petitioners to pay him eighty thousand
pesos (P80,000.00) as actual damages, two hundred thousand pesos (P200,000.00) as moral damages,
twenty thousand pesos (P20,000.00) as exemplary damages, thirty thousand pesos (P30,000.00) as
attorney's fees, and costs. Petitioners appealed the RTC decision to the Court of Appeals. On the other
hand, Tobias appealed as to the amount of damages. However, the Court of Appeals, an a decision dated
August 31, 1987 affirmed the RTC decision in toto. Petitioners' motion for reconsideration having been
denied, the instant petition for review on certiorari was filed.

The main issue in this case is whether or not petitioners are liable for damages to private respondent.

Petitioners contend that they could not be made liable for damages in the lawful exercise of their right to
dismiss private respondent.

On the other hand, private respondent contends that because of petitioners' abusive manner in dismissing
him as well as for the inhuman treatment he got from them, the Petitioners must indemnify him for the
damage that he had suffered.

One of the more notable innovations of the New Civil Code is the codification of "some basic principles
that are to be observed for the rightful relationship between human beings and for the stability of the
social order." [REPORT ON THE CODE COMMISSION ON THE PROPOSED CIVIL CODE OF THE
PHILIPPINES, p. 39]. The framers of the Code, seeking to remedy the defect of the old Code which
merely stated the effects of the law, but failed to draw out its spirit, incorporated certain fundamental
precepts which were "designed to indicate certain norms that spring from the fountain of good
conscience" and which were also meant to serve as "guides for human conduct [that] should run as golden
threads through society, to the end that law may approach its supreme ideal, which is the sway and
dominance of justice" (Id.) Foremost among these principles is that pronounced in Article 19 which
provides:

Art. 19. Every person must, in the exercise of his rights and in the performance of his
duties, act with justice, give everyone his due, and observe honesty and good faith.
This article, known to contain what is commonly referred to as the principle of abuse of rights, sets
certain standards which must be observed not only in the exercise of one's rights but also in the
performance of one's duties. These standards are the following: to act with justice; to give everyone his
due; and to observe honesty and good faith. The law, therefore, recognizes a primordial limitation on all
rights; that in their exercise, the norms of human conduct set forth in Article 19 must be observed. A
right, though by itself legal because recognized or granted by law as such, may nevertheless become the
source of some illegality. When a right is exercised in a manner which does not conform with the norms
enshrined in Article 19 and results in damage to another, a legal wrong is thereby committed for which
the wrongdoer must be held responsible. But while Article 19 lays down a rule of conduct for the
government of human relations and for the maintenance of social order, it does not provide a remedy for
its violation. Generally, an action for damages under either Article 20 or Article 21 would be proper.

Article 20, which pertains to damage arising from a violation of law, provides that:

Art. 20. Every person who contrary to law, wilfully or negligently causes damage to
another, shall indemnify the latter for the same.

However, in the case at bar, petitioners claim that they did not violate any provision of law since they
were merely exercising their legal right to dismiss private respondent. This does not, however, leave
private respondent with no relief because Article 21 of the Civil Code provides that:

Art. 21. Any person who wilfully causes loss or injury to another in a manner that is
contrary to morals, good customs or public policy shall compensate the latter for the
damage.

This article, adopted to remedy the "countless gaps in the statutes, which leave so many victims of moral
wrongs helpless, even though they have actually suffered material and moral injury" [Id.] should
"vouchsafe adequate legal remedy for that untold number of moral wrongs which it is impossible for
human foresight to provide for specifically in the statutes" [Id. it p. 40; See also PNB v. CA, G.R. No. L-
27155, May 18,1978, 83 SCRA 237, 247].

In determining whether or not the principle of abuse of rights may be invoked, there is no rigid test which
can be applied. While the Court has not hesitated to apply Article 19 whether the legal and factual
circumstances called for its application [See for e.g., Velayo v. Shell Co. of the Phil., Ltd., 100 Phil. 186
(1956); PNB v. CA, supra; Grand Union Supermarket, Inc. v. Espino, Jr., G.R. No. L-48250, December
28, 1979, 94 SCRA 953; PAL v. CA, G.R. No. L-46558, July 31,1981,106 SCRA 391; United General
Industries, Inc, v. Paler G.R. No. L-30205, March 15,1982,112 SCRA 404; Rubio v. CA, G.R. No. 50911,
August 21, 1987, 153 SCRA 183] the question of whether or not the principle of abuse of rights has been
violated resulting in damages under Article 20 or Article 21 or other applicable provision of law, depends
on the circumstances of each case. And in the instant case, the Court, after examining the record and
considering certain significant circumstances, finds that all petitioners have indeed abused the right that
they invoke, causing damage to private respondent and for which the latter must now be indemnified.

The trial court made a finding that notwithstanding the fact that it was private respondent Tobias who
reported the possible existence of anomalous transactions, petitioner Hendry "showed belligerence and
told plaintiff (private respondent herein) that he was the number one suspect and to take a one week
vacation leave, not to communicate with the office, to leave his table drawers open, and to leave his keys
to said defendant (petitioner Hendry)" [RTC Decision, p. 2; Rollo, p. 232]. This, petitioners do not
dispute. But regardless of whether or not it was private respondent Tobias who reported the anomalies to
petitioners, the latter's reaction towards the former upon uncovering the anomalies was less than civil. An
employer who harbors suspicions that an employee has committed dishonesty might be justified in taking
the appropriate action such as ordering an investigation and directing the employee to go on a leave.
Firmness and the resolve to uncover the truth would also be expected from such employer. But the high-
handed treatment accorded Tobias by petitioners was certainly uncalled for. And this reprehensible
attitude of petitioners was to continue when private respondent returned to work on November 20, 1972
after his one week forced leave. Upon reporting for work, Tobias was confronted by Hendry who said.
"Tobby, you are the crook and swindler in this company." Considering that the first report made by the
police investigators was submitted only on December 10, 1972 [See Exh. A] the statement made by
petitioner Hendry was baseless. The imputation of guilt without basis and the pattern of harassment
during the investigations of Tobias transgress the standards of human conduct set forth in Article 19 of
the Civil Code. The Court has already ruled that the right of the employer to dismiss an employee should
not be confused with the manner in which the right is exercised and the effects flowing therefrom. If the
dismissal is done abusively, then the employer is liable for damages to the employee [Quisaba v. Sta.
Ines-Melale Veneer and Plywood Inc., G.R. No. L-38088, August 30, 1974, 58 SCRA 771; See
also Philippine Refining Co., Inc. v. Garcia, G.R. No. L-21871, September 27,1966, 18 SCRA 107]
Under the circumstances of the instant case, the petitioners clearly failed to exercise in a legitimate
manner their right to dismiss Tobias, giving the latter the right to recover damages under Article 19 in
relation to Article 21 of the Civil Code.

But petitioners were not content with just dismissing Tobias. Several other tortious acts were committed
by petitioners against Tobias after the latter's termination from work. Towards the latter part of January,
1973, after the filing of the first of six criminal complaints against Tobias, the latter talked to Hendry to
protest the actions taken against him. In response, Hendry cut short Tobias' protestations by telling him to
just confess or else the company would file a hundred more cases against him until he landed in jail.
Hendry added that, "You Filipinos cannot be trusted." The threat unmasked petitioner's bad faith in the
various actions taken against Tobias. On the other hand, the scornful remark about Filipinos as well as
Hendry's earlier statements about Tobias being a "crook" and "swindler" are clear violations of 'Tobias'
personal dignity [See Article 26, Civil Code].

The next tortious act committed by petitioners was the writing of a letter to RETELCO sometime in
October 1974, stating that Tobias had been dismissed by GLOBE MACKAY due to dishonesty. Because
of the letter, Tobias failed to gain employment with RETELCO and as a result of which, Tobias remained
unemployed for a longer period of time. For this further damage suffered by Tobias, petitioners must
likewise be held liable for damages consistent with Article 2176 of the Civil Code. Petitioners, however,
contend that they have a "moral, if not legal, duty to forewarn other employers of the kind of employee
the plaintiff (private respondent herein) was." [Petition, p. 14; Rollo, p. 15]. Petitioners further claim that
"it is the accepted moral and societal obligation of every man to advise or warn his fellowmen of any
threat or danger to the latter's life, honor or property. And this includes warning one's brethren of the
possible dangers involved in dealing with, or accepting into confidence, a man whose honesty and
integrity is suspect" [Id.]. These arguments, rather than justify petitioners' act, reveal a seeming obsession
to prevent Tobias from getting a job, even after almost two years from the time Tobias was dismissed.

Finally, there is the matter of the filing by petitioners of six criminal complaints against Tobias.
Petitioners contend that there is no case against them for malicious prosecution and that they cannot be
"penalized for exercising their right and prerogative of seeking justice by filing criminal complaints
against an employee who was their principal suspect in the commission of forgeries and in the
perpetration of anomalous transactions which defrauded them of substantial sums of money" [Petition, p.
10, Rollo, p. 11].

While sound principles of justice and public policy dictate that persons shall have free resort to the courts
for redress of wrongs and vindication of their rights [Buenaventura v. Sto. Domingo, 103 Phil. 239
(1958)], the right to institute criminal prosecutions can not be exercised maliciously and in bad faith
[Ventura v. Bernabe, G.R. No. L-26760, April 30, 1971, 38 SCRA 5871.] Hence, in Yutuk V. Manila
Electric Co., G.R. No. L-13016, May 31, 1961, 2 SCRA 337, the Court held that the right to file criminal
complaints should not be used as a weapon to force an alleged debtor to pay an indebtedness. To do so
would be a clear perversion of the function of the criminal processes and of the courts of justice. And
in Hawpia CA, G.R. No. L-20047, June 30, 1967. 20 SCRA 536 the Court upheld the judgment against
the petitioner for actual and moral damages and attorney's fees after making a finding that petitioner, with
persistence, filed at least six criminal complaints against respondent, all of which were dismissed.

To constitute malicious prosecution, there must be proof that the prosecution was prompted by a design to
vex and humiliate a person and that it was initiated deliberately by the defendant knowing that the charges
were false and groundless [Manila Gas Corporation v. CA, G.R. No. L-44190, October 30,1980, 100
SCRA 602]. Concededly, the filing of a suit by itself, does not render a person liable for malicious
prosecution [Inhelder Corporation v. CA, G.R. No. 52358, May 301983122 SCRA 576]. The mere
dismissal by the fiscal of the criminal complaint is not a ground for an award of damages for malicious
prosecution if there is no competent evidence to show that the complainant had acted in bad faith [Sison
v. David, G.R. No. L-11268, January 28,1961, 1 SCRA 60].

In the instant case, however, the trial court made a finding that petitioners acted in bad faith in filing the
criminal complaints against Tobias, observing that:
xxx

Defendants (petitioners herein) filed with the Fiscal's Office of Manila a total of six (6)
criminal cases, five (5) of which were for estafa thru falsification of commercial
document and one for violation of Art. 290 of the Revised Penal Code "discovering
secrets thru seizure of correspondence," and all were dismissed for insufficiency or lack
of evidence." The dismissal of four (4) of the cases was appealed to the Ministry of
Justice, but said Ministry invariably sustained the dismissal of the cases. As above
adverted to, two of these cases were refiled with the Judge Advocate General's Office of
the Armed Forces of the Philippines to railroad plaintiffs arrest and detention in the
military stockade, but this was frustrated by a presidential decree transferring criminal
cases involving civilians to the civil courts.

xxx

To be sure, when despite the two (2) police reports embodying the findings of Lt.
Dioscoro Tagle, Chief Document Examiner of the Manila Police Department, clearing
plaintiff of participation or involvement in the fraudulent transactions complained of,
despite the negative results of the lie detector tests which defendants compelled plaintiff
to undergo, and although the police investigation was "still under follow-up and a
supplementary report will be submitted after all the evidence has been gathered,"
defendants hastily filed six (6) criminal cases with the city Fiscal's Office of Manila, five
(5) for estafa thru falsification of commercial document and one (1) for violation of Art.
290 of the Revised Penal Code, so much so that as was to be expected, all six (6) cases
were dismissed, with one of the investigating fiscals, Asst. Fiscal de Guia, commenting in
one case that, "Indeed, the haphazard way this case was investigated is evident. Evident
likewise is the flurry and haste in the filing of this case against respondent Tobias," there
can be no mistaking that defendants would not but be motivated by malicious and
unlawful intent to harass, oppress, and cause damage to plaintiff.

xxx

[RTC Decision, pp. 5-6; Rollo, pp. 235-236].

In addition to the observations made by the trial court, the Court finds it significant that the criminal
complaints were filed during the pendency of the illegal dismissal case filed by Tobias against petitioners.
This explains the haste in which the complaints were filed, which the trial court earlier noted. But
petitioners, to prove their good faith, point to the fact that only six complaints were filed against Tobias
when they could have allegedly filed one hundred cases, considering the number of anomalous
transactions committed against GLOBE MACKAY. However, petitioners' good faith is belied by the
threat made by Hendry after the filing of the first complaint that one hundred more cases would be filed
against Tobias. In effect, the possible filing of one hundred more cases was made to hang like the sword
of Damocles over the head of Tobias. In fine, considering the haste in which the criminal complaints were
filed, the fact that they were filed during the pendency of the illegal dismissal case against petitioners, the
threat made by Hendry, the fact that the cases were filed notwithstanding the two police reports
exculpating Tobias from involvement in the anomalies committed against GLOBE MACKAY, coupled
by the eventual dismissal of all the cases, the Court is led into no other conclusion than that petitioners
were motivated by malicious intent in filing the six criminal complaints against Tobias.

Petitioners next contend that the award of damages was excessive. In the complaint filed against
petitioners, Tobias prayed for the following: one hundred thousand pesos (P100,000.00) as actual
damages; fifty thousand pesos (P50,000.00) as exemplary damages; eight hundred thousand pesos
(P800,000.00) as moral damages; fifty thousand pesos (P50,000.00) as attorney's fees; and costs. The trial
court, after making a computation of the damages incurred by Tobias [See RTC Decision, pp. 7-8; Rollo,
pp. 154-1551, awarded him the following: eighty thousand pesos (P80,000.00) as actual damages; two
hundred thousand pesos (P200,000.00) as moral damages; twenty thousand pesos (P20,000.00) as
exemplary damages; thirty thousand pesos (P30,000.00) as attorney's fees; and, costs. It must be
underscored that petitioners have been guilty of committing several actionable tortious acts, i.e., the
abusive manner in which they dismissed Tobias from work including the baseless imputation of guilt and
the harassment during the investigations; the defamatory language heaped on Tobias as well as the
scornful remark on Filipinos; the poison letter sent to RETELCO which resulted in Tobias' loss of
possible employment; and, the malicious filing of the criminal complaints. Considering the extent of the
damage wrought on Tobias, the Court finds that, contrary to petitioners' contention, the amount of
damages awarded to Tobias was reasonable under the circumstances.

Yet, petitioners still insist that the award of damages was improper, invoking the principle of damnum
absqueinjuria. It is argued that "[t]he only probable actual damage that plaintiff (private respondent
herein) could have suffered was a direct result of his having been dismissed from his employment, which
was a valid and legal act of the defendants-appellants (petitioners herein).lâwphî1.ñèt " [Petition, p. 17;
Rollo, p. 18].

According to the principle of damnum absque injuria, damage or loss which does not constitute a
violation of a legal right or amount to a legal wrong is not actionable [Escano v. CA, G.R. No. L-47207,
September 25, 1980, 100 SCRA 197; See also Gilchrist v. Cuddy 29 Phil, 542 (1915); The Board of
Liquidators v. Kalaw, G.R. No. L-18805, August 14, 1967, 20 SCRA 987]. This principle finds no
application in this case. It bears repeating that even granting that petitioners might have had the right to
dismiss Tobias from work, the abusive manner in which that right was exercised amounted to a legal
wrong for which petitioners must now be held liable. Moreover, the damage incurred by Tobias was not
only in connection with the abusive manner in which he was dismissed but was also the result of several
other quasi-delictual acts committed by petitioners.

Petitioners next question the award of moral damages. However, the Court has already ruled in Wassmer
v. Velez, G.R. No. L-20089, December 26, 1964, 12 SCRA 648, 653, that [p]er express provision of
Article 2219 (10) of the New Civil Code, moral damages are recoverable in the cases mentioned in
Article 21 of said Code." Hence, the Court of Appeals committed no error in awarding moral damages to
Tobias.

Lastly, the award of exemplary damages is impugned by petitioners. Although Article 2231 of the Civil
Code provides that "[i]n quasi-delicts, exemplary damages may be granted if the defendant acted with
gross negligence," the Court, in Zulueta v. Pan American World Airways, Inc., G.R. No. L- 28589,
January 8, 1973, 49 SCRA 1, ruled that if gross negligence warrants the award of exemplary damages,
with more reason is its imposition justified when the act performed is deliberate, malicious and tainted
with bad faith. As in the Zuluetacase, the nature of the wrongful acts shown to have been committed by
petitioners against Tobias is sufficient basis for the award of exemplary damages to the latter.

WHEREFORE, the petition is hereby DENIED and the decision of the Court of Appeals in CA-G.R. CV
No. 09055 is AFFIRMED.

SO ORDERED.

SECOND DIVISION

FAR EAST BANK AND TRUST G.R. No. 157314


COMPANY, NOW BANK OF
THE PHILIPPINE ISLANDS, Present:
Petitioner,
PUNO, J., Chairman,
AUSTRIA-MARTINEZ,
CALLEJO, SR.,
- versus - TINGA, and
CHICO-NAZARIO, JJ.
Promulgated:
THEMISTOCLES PACILAN, JR.,
Respondent. July 29, 2005
x--------------------------------------------------x

DECISION

CALLEJO, SR., J.:


Before the Court is the petition for review on certiorari filed by Far East Bank and Trust Company (now

Bank of the Philippines Islands) seeking the reversal of the Decision[1]dated August 30, 2002 of the Court

of Appeals (CA) in CA-G.R. CV No. 36627 which ordered it, together with its branch accountant, Roger

Villadelgado, to pay respondent Themistocles Pacilan, Jr.[2] the total sum of P100,000.00 as moral and

exemplary damages. The assailed decision affirmed with modification that of the Regional Trial Court

(RTC) of Negros Occidental, Bacolod City, Branch 54, in Civil Case No. 4908. Likewise sought to be

reversed and set aside is the Resolution dated January 17, 2003 of the appellate court, denying petitioner

banks motion for reconsideration.

The case stemmed from the following undisputed facts:

Respondent Pacilan opened a current account with petitioner banks Bacolod Branch on May 23, 1980.

His account was denominated as Current Account No. 53208 (0052-00407-4). The respondent had since

then issued several postdated checks to different payees drawn against the said account. Sometime in

March 1988, the respondent issued Check No. 2434886 in the amount of P680.00 and the same was

presented for payment to petitioner bank on April 4, 1988.

Upon its presentment on the said date, Check No. 2434886 was dishonored by petitioner bank.

The next day, or on April 5, 1988, the respondent deposited to his current account the amount of P800.00.

The said amount was accepted by petitioner bank; hence, increasing the balance of the respondents

deposit to P1,051.43.

Subsequently, when the respondent verified with petitioner bank about the dishonor of Check No.

2434866, he discovered that his current account was closed on the ground that it was improperly handled.

The records of petitioner bank disclosed that between the period of March 30,

1988 and April 5, 1988, the respondent issued four checks, to wit: Check No. 2480416 for P6,000.00;

Check No. 2480419 for P50.00; Check No. 2434880 for P680.00 and; Check No. 2434886 for P680.00,

or a total amount of P7,410.00. At the time, however, the respondents current account with petitioner

bank only had a deposit of P6,981.43. Thus, the total amount of the checks presented for payment on

April 4, 1988 exceeded the balance of the respondents deposit in his account. For this reason, petitioner

bank, through its branch accountant, Villadelgado, closed the respondents current account effective the

evening of April 4, 1988 as it then had an overdraft of P428.57. As a consequence of the overdraft, Check

No. 2434886 was dishonored.


On April 18, 1988, the respondent wrote to petitioner bank complaining that the closure of his

account was unjustified. When he did not receive a reply from petitioner bank, the respondent filed with

the RTC of Negros Occidental, Bacolod City, Branch 54, a complaint for damages against petitioner bank

and Villadelgado. The case was docketed as Civil Case No. 4908. The respondent, as complainant therein,

alleged that the closure of his current account by petitioner bank was unjustified because on the first

banking hour of April 5, 1988, he already deposited an amount sufficient to fund his checks. The

respondent pointed out that Check No. 2434886, in particular, was delivered to petitioner bank at the

close of banking hours on April 4, 1988 and, following normal banking procedure, it

(petitioner bank) had until the last clearing hour of the following day, or on April 5, 1988, to honor the

check or return it, if not funded. In disregard of this banking procedure and practice, however, petitioner

bank hastily closed the respondents current account and dishonored his Check No. 2434886.

The respondent further alleged that prior to the closure of his current account, he had issued several other

postdated checks. The petitioner banks act of closing his current account allegedly preempted the deposits

that he intended to make to fund those checks. Further, the petitioner banks act exposed him to criminal

prosecution for violation of Batas Pambansa Blg. 22.

According to the respondent, the indecent haste that attended the closure of his account was patently

malicious and intended to embarrass him. He claimed that he is a Cashier of Prudential Bank and Trust

Company, whose branch office is located just across that of petitioner bank, and a prominent and

respected leader both in the civic and banking communities. The alleged malicious acts of petitioner bank

besmirched the respondents reputation and caused him social humiliation, wounded feelings,

insurmountable worries and sleepless nights entitling him to an award of damages.

In their answer, petitioner bank and Villadelgado maintained that the respondents current account was

subject to petitioner banks Rules and Regulations Governing the Establishment and Operation of Regular

Demand

Deposits which provide that the Bank reserves the right to close an account if the depositor frequently

draws checks against insufficient funds and/or uncollected deposits and that the Bank reserves the right at

any time to return checks of the depositor which are drawn against insufficient funds or for any reason. [3]

They showed that the respondent had improperly and irregularly handled his current account. For

example, in 1986, the respondents account was overdrawn 156 times, in 1987, 117 times and in 1988, 26

times. In all these instances, the account was overdrawn due to the issuance of checks against insufficient
funds. The respondent had also signed several checks with a different signature from the specimen on file

for dubious reasons.

When the respondent made the deposit on April 5, 1988, it was obviously to cover for issuances made the

previous day against an insufficiently funded account. When his Check No. 2434886 was presented for

payment on April 4, 1988, he had already incurred an overdraft; hence, petitioner bank rightfully

dishonored the same for insufficiency of funds.

After due proceedings, the court a quo rendered judgment in favor of the respondent as it ordered the

petitioner bank and Villadelgado, jointly and severally, to pay the respondent the amounts of P100,000.00

as moral damages and P50,000.00 as exemplary damages and costs of suit. In so ruling, the court a

quo also cited petitioner banks rules and regulations which state that a charge of P10.00 shall be levied

against the depositor for any check that is taken up as a returned item due to insufficiency of funds on the

date of receipt from the clearing office even if said check is honored and/or covered by sufficient deposit

the following banking day. The same rules and regulations also provide that a check returned for

insufficiency of funds for any reason of similar import may be subsequently recleared for one more time

only, subject to the same charges.

According to the court a quo, following these rules and regulations, the respondent, as depositor, had the

right to put up sufficient funds for a check that was taken as a returned item for insufficient funds the day

following the receipt of said check from the clearing office. In fact, the said check could still be recleared

for one more time. In previous instances, petitioner bank notified the respondent when he incurred an

overdraft and he would then deposit sufficient funds the following day to cover the overdraft. Petitioner

bank thus acted unjustifiably when it immediately closed the respondents account on April 4, 1988 and

deprived him of the opportunity to reclear his check or deposit sufficient funds therefor the following day.

As a result of the closure of his current account, several of the respondents checks were subsequently

dishonored and because of this, the respondent was humiliated, embarrassed and lost his credit standing in

the business community. The court a quo further ratiocinated that even granting arguendo that petitioner

bank had the right to close the respondents account, the manner which attended the closure constituted an

abuse of the

said right. Citing Article 19 of the Civil Code of the Philippines which states that [e]very person must, in

the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and

observe honesty and good faith and Article 20 thereof which states that [e]very person who, contrary to
law, wilfully or negligently causes damage to another, shall indemnify the latter for the same, the court a

quo adjudged petitioner bank of acting in bad faith. It held that, under the foregoing circumstances, the

respondent is entitled to an award of moral and exemplary damages.

The decretal portion of the court a quos decision reads:

WHEREFORE, PREMISES CONSIDERED, judgment is hereby rendered:

1. Ordering the defendants [petitioner bank and Villadelgado], jointly and


severally, to pay plaintiff [the respondent] the sum of P100,000.00 as moral
damages;

2. Ordering the defendants, jointly and severally, to pay plaintiff the sum
of P50,000.00 as exemplary damages plus costs and expenses of the suit; and

3. Dismissing [the] defendants counterclaim for lack of merit.

SO ORDERED.[4]

On appeal, the CA rendered the Decision dated August 30, 2002, affirming with modification the decision

of the court a quo.

The appellate court substantially affirmed the factual findings of the court a quo as it held that petitioner

bank unjustifiably closed the respondents account notwithstanding that its own rules and regulations

allow that a check returned for insufficiency of funds or any reason of similar import, may be

subsequently recleared for one more time, subject to standard charges. Like the court a quo, the appellate

court observed that in several instances in previous years, petitioner bank would inform the respondent

when he incurred an overdraft and allowed him to make a timely deposit to fund the checks that were

initially dishonored for insufficiency of funds. However, on April 4, 1988, petitioner bank immediately

closed the respondents account without even notifying him that he had incurred an overdraft. Even when

they had already closed his account on April 4, 1988, petitioner bank still accepted the deposit that the

respondent made on April 5, 1988, supposedly to cover his checks.

Echoing the reasoning of the court a quo, the CA declared that even as it may be conceded that

petitioner bank had reserved the right to close an account for repeated overdrafts by the respondent, the

exercise of that right must never be despotic or arbitrary. That petitioner bank chose to close the account

outright and return the check, even after accepting a deposit sufficient to cover the said check, is contrary

to its duty to handle the respondents account with utmost fidelity. The exercise of the right is not absolute

and good faith, at least, is required. The manner by which petitioner bank closed the account of the
respondent runs afoul of Article 19 of the Civil Code which enjoins every person, in the exercise of his

rights, to give every one his due, and observe honesty and good faith.

The CA concluded that petitioner banks precipitate and imprudent closure of the respondents

account had caused him, a respected officer of several civic and banking associations, serious anxiety and

humiliation. It had, likewise, tainted his credit standing. Consequently, the award of damages is

warranted. The CA, however, reduced the amount of damages awarded by the court a quo as it found the

same to be excessive:

We, however, find excessive the amount of damages awarded by the RTC. In our
view the reduced amount of P75,000.00 as moral damages and P25,000.00 as exemplary
damages are in order. Awards for damages are not meant to enrich the plaintiff-appellee
[the respondent] at the expense of defendants-appellants [the petitioners], but to obviate
the moral suffering he has undergone. The award is aimed at the restoration, within limits
possible, of the status quo ante, and should be proportionate to the suffering inflicted.[5]

The dispositive portion of the assailed CA decision reads:

WHEREFORE, the decision appealed from is hereby AFFIRMED, subject to the


MODIFICATION that the award of moral damages is reduced to P75,000.00 and the
award of exemplary damages reduced to P25,000.00.

SO ORDERED.[6]

Petitioner bank sought the reconsideration of the said decision but in the assailed Resolution dated

January 17, 2003, the appellate court denied its motion. Hence, the recourse to this Court.

Petitioner bank maintains that, in closing the account of the respondent in the evening of April 4, 1988, it

acted in good faith and in accordance with the rules and regulations governing the operation of a

regular demand deposit which reserves to the bank the right to close an account if the depositor frequently

draws checks against insufficient funds and/or uncollected deposits. The same rules and regulations also

provide that the depositor is not entitled, as a matter of right, to overdraw on this deposit and the bank

reserves the right at any time to return checks of the depositor which are drawn against insufficient funds

or for any reason.

It cites the numerous instances that the respondent had overdrawn his account and those instances where

he deliberately signed checks using a signature different from the specimen on file. Based on these facts,
petitioner bank was constrained to close the respondents account for improper and irregular handling and

returned his Check No. 2434886 which was presented to the bank for payment on April 4, 1988.

Petitioner bank further posits that there is no law or rule which gives the respondent a legal right to make

good his check or to deposit the corresponding amount to cover said check within 24 hours after the same

is dishonored or returned by the bank for having been drawn against insufficient funds. It vigorously

denies having violated Article 19 of the Civil Code as it insists that it acted in good faith and in

accordance with the pertinent banking rules and regulations.

The petition is impressed with merit.

A perusal of the respective decisions of the court a quo and the appellate court show that the

award of damages in the respondents favor was anchored mainly on Article 19 of the Civil Code which,

quoted anew below, reads:


Art. 19. Every person must, in the exercise of his rights and in the performance of
his duties, act with justice, give everyone his due, and observe honesty and good faith.

The elements of abuse of rights are the following: (a) the existence of a legal right or duty; (b)

which is exercised in bad faith; and (c) for the sole intent of prejudicing or injuring another. [7] Malice or

bad faith is at the core of the said provision.[8] The law always presumes good faith and any person who

seeks to be awarded damages due to acts of another has the burden of proving that the latter acted in bad

faith or with ill-motive.[9] Good faith refers to the state of the mind which is manifested by the acts of the

individual concerned. It consists of the intention to abstain from taking an unconscionable and

unscrupulous advantage of another.[10] Bad faith does not simply connote bad judgment or simple

negligence, dishonest purpose or some moral obliquity and conscious doing of a wrong, a breach of

known duty due to some motives or interest or ill-will that partakes of the nature of fraud.[11] Malice

connotes ill-will or spite and speaks not in response to duty. It implies an intention to do ulterior and

unjustifiable harm. Malice is bad faith or bad motive.[12]

Undoubtedly, petitioner bank has the right to close the account of the respondent based on the

following provisions of its Rules and Regulations Governing the Establishment and Operation of Regular

Demand Deposits:

10) The Bank reserves the right to close an account if the depositor frequently draws
checks against insufficient funds and/or uncollected deposits.

12)
However, it is clearly understood that the depositor is not entitled, as a matter of
right, to overdraw on this deposit and the bank reserves the right at any time to
return checks of the depositor which are drawn against insufficient funds or for any
other reason.

The facts, as found by the court a quo and the appellate court, do not establish that, in the exercise

of this right, petitioner bank committed an abuse thereof. Specifically, the second and third elements for

abuse of rights are not attendant in the present case. The evidence presented by petitioner bank negates

the existence of bad faith or malice on its part in closing the respondents account on April 4, 1988

because on the said date the same was already overdrawn. The respondent issued four checks, all due on

April 4, 1988, amounting to P7,410.00 when the balance of his current account deposit was

only P6,981.43. Thus, he incurred an overdraft of P428.57 which resulted in the dishonor of his Check

No. 2434886. Further, petitioner bank showed that in 1986, the current account of the respondent was

overdrawn 156 times due to his issuance of checks against insufficient funds.[13] In 1987, the said account

was overdrawn 117 times for the same

reason.[14] Again, in 1988, 26 times.[15] There were also several instances when the respondent issued

checks deliberately using a signature different from his specimen signature on file with petitioner

bank.[16] All these circumstances taken together justified the petitioner banks closure of the respondents

account on April 4, 1988 for improper handling.

It is observed that nowhere under its rules and regulations is petitioner bank required to notify the

respondent, or any depositor for that matter, of the closure of the account for frequently drawing checks

against insufficient funds. No malice or bad faith could be imputed on petitioner bank for so acting since

the records bear out that the respondent had indeed been improperly and irregularly handling his account

not just a few times but hundreds of times. Under the circumstances, petitioner bank could not be faulted

for exercising its right in accordance with the express rules and regulations governing the current

accounts of its depositors. Upon the opening of his account, the respondent had agreed to be bound by

these terms and conditions.

Neither the fact that petitioner bank accepted the deposit made by the respondent the day following the

closure of his account constitutes bad faith or malice on the part of petitioner bank. The same could be

characterized as simple negligence by its personnel. Said act, by itself, is not constitutive of bad faith.
The respondent had thus failed to discharge his burden of proving bad faith on the part of

petitioner bank or that it was motivated by ill-will or spite in closing his account on April 4, 1988 and in

inadvertently accepting his deposit on April 5, 1988.

Further, it has not been shown that these acts were done by petitioner bank with the sole intention

of prejudicing and injuring the respondent. It is conceded that the respondent may have suffered damages

as a result of the closure of his current account. However, there is a material distinction between damages

and injury. The Court had the occasion to explain the distinction between damages and injury in this wise:

Injury is the illegal invasion of a legal right; damage is the loss, hurt or harm
which results from the injury; and damages are the recompense or compensation awarded
for the damage suffered. Thus, there can be damage without injury in those instances in
which the loss or harm was not the result of a violation of a legal duty. In such cases, the
consequences must be borne by the injured person alone, the law affords no remedy for
damages resulting from an act which does not amount to a legal injury or wrong. These
situations are often called damnum absque injuria.

In other words, in order that a plaintiff may maintain an action for the injuries of which
he complains, he must establish that such injuries resulted from a breach of duty which
the defendant owed to the plaintiff a concurrence of injury to the plaintiff and legal
responsibility by the person causing it. The underlying basis for the award of tort
damages is the premise that the individual was injured in contemplation of law. Thus,
there must first be a breach of some duty and the imposition of liability for that breach
before damages may be awarded; and the breach of such duty should be the proximate
cause of the injury.[17]

Whatever damages the respondent may have suffered as a consequence, e.g., dishonor of his other

insufficiently funded checks, would have to be borne by him alone. It was the respondents repeated

improper

and irregular handling of his account which constrained petitioner bank to close the same in accordance

with the rules and regulations governing its depositors current accounts. The respondents case is clearly

one of damnum absque injuria.

WHEREFORE, the petition is GRANTED. The Decision dated August 30, 2002 and Resolution

dated January 17, 2003 of the Court of Appeals in CA-G.R. CV No. 36627 are REVERSED AND SET

ASIDE.

SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

EN BANC
G.R. No. L-20089 December 26, 1964

BEATRIZ P. WASSMER, plaintiff-appellee,


vs.
FRANCISCO X. VELEZ, defendant-appellant.

Jalandoni & Jamir for defendant-appellant.


Samson S. Alcantara for plaintiff-appellee.

BENGZON, J.P., J.:

The facts that culminated in this case started with dreams and hopes, followed by appropriate planning
and serious endeavors, but terminated in frustration and, what is worse, complete public humiliation.

Francisco X. Velez and Beatriz P. Wassmer, following their mutual promise of love, decided to get
married and set September 4, 1954 as the big day. On September 2, 1954 Velez left this note for his bride-
to-be:

Dear Bet —

Will have to postpone wedding — My mother opposes it. Am leaving on the Convair
today.

Please do not ask too many people about the reason why — That would only create a
scandal.

Paquing

But the next day, September 3, he sent her the following telegram:

NOTHING CHANGED REST ASSURED RETURNING VERY SOON APOLOGIZE


MAMA PAPA LOVE .

PAKING

Thereafter Velez did not appear nor was he heard from again.

Sued by Beatriz for damages, Velez filed no answer and was declared in default. Plaintiff adduced
evidence before the clerk of court as commissioner, and on April 29, 1955, judgment was rendered
ordering defendant to pay plaintiff P2,000.00 as actual damages; P25,000.00 as moral and exemplary
damages; P2,500.00 as attorney's fees; and the costs.

On June 21, 1955 defendant filed a "petition for relief from orders, judgment and proceedings and motion
for new trial and reconsideration." Plaintiff moved to strike it cut. But the court, on August 2, 1955,
ordered the parties and their attorneys to appear before it on August 23, 1955 "to explore at this stage of
the proceedings the possibility of arriving at an amicable settlement." It added that should any of them fail
to appear "the petition for relief and the opposition thereto will be deemed submitted for resolution."

On August 23, 1955 defendant failed to appear before court. Instead, on the following day his counsel
filed a motion to defer for two weeks the resolution on defendants petition for relief. The counsel stated
that he would confer with defendant in Cagayan de Oro City — the latter's residence — on the possibility
of an amicable element. The court granted two weeks counted from August 25, 1955.

Plaintiff manifested on June 15, 1956 that the two weeks given by the court had expired on September 8,
1955 but that defendant and his counsel had failed to appear.

Another chance for amicable settlement was given by the court in its order of July 6, 1956 calling the
parties and their attorneys to appear on July 13, 1956. This time. however, defendant's counsel informed
the court that chances of settling the case amicably were nil.
On July 20, 1956 the court issued an order denying defendant's aforesaid petition. Defendant has appealed
to this Court. In his petition of June 21, 1955 in the court a quo defendant alleged excusable negligence as
ground to set aside the judgment by default. Specifically, it was stated that defendant filed no answer in
the belief that an amicable settlement was being negotiated.

A petition for relief from judgment on grounds of fraud, accident, mistake or excusable negligence, must
be duly supported by an affidavit of merits stating facts constituting a valid defense. (Sec. 3, Rule 38,
Rules of Court.) Defendant's affidavit of merits attached to his petition of June 21, 1955 stated: "That he
has a good and valid defense against plaintiff's cause of action, his failure to marry the plaintiff as
scheduled having been due to fortuitous event and/or circumstances beyond his control." An affidavit of
merits like this stating mere conclusions or opinions instead of facts is not valid. (Cortes vs. Co Bun Kim,
L-3926, Oct. 10, 1951; Vaswani vs. P. Tarrachand Bros., L-15800, December 29, 1960.)

Defendant, however, would contend that the affidavit of merits was in fact unnecessary, or a mere
surplusage, because the judgment sought to be set aside was null and void, it having been based on
evidence adduced before the clerk of court. In Province of Pangasinan vs. Palisoc, L-16519, October 30,
1962, this Court pointed out that the procedure of designating the clerk of court as commissioner to
receive evidence is sanctioned by Rule 34 (now Rule 33) of the Rules of Court. Now as to defendant's
consent to said procedure, the same did not have to be obtained for he was declared in default and thus
had no standing in court (Velez vs. Ramas, 40 Phil. 787; Alano vs. Court of First Instance, L-14557,
October 30, 1959).

In support of his "motion for new trial and reconsideration," defendant asserts that the judgment is
contrary to law. The reason given is that "there is no provision of the Civil Code authorizing" an action
for breach of promise to marry. Indeed, our ruling in Hermosisima vs. Court of Appeals (L-14628, Sept.
30, 1960), as reiterated in Estopa vs. Biansay (L-14733, Sept. 30, 1960), is that "mere breach of a promise
to marry" is not an actionable wrong. We pointed out that Congress deliberately eliminated from the draft
of the new Civil Code the provisions that would have it so.

It must not be overlooked, however, that the extent to which acts not contrary to law may be perpetrated
with impunity, is not limitless for Article 21 of said Code provides that "any person who wilfully causes
loss or injury to another in a manner that is contrary to morals, good customs or public policy shall
compensate the latter for the damage."

The record reveals that on August 23, 1954 plaintiff and defendant applied for a license to contract
marriage, which was subsequently issued (Exhs. A, A-1). Their wedding was set for September 4, 1954.
Invitations were printed and distributed to relatives, friends and acquaintances (Tsn., 5; Exh. C). The
bride-to-be's trousseau, party drsrses and other apparel for the important occasion were purchased (Tsn.,
7-8). Dresses for the maid of honor and the flower girl were prepared. A matrimonial bed, with
accessories, was bought. Bridal showers were given and gifts received (Tsn., 6; Exh. E). And then, with
but two days before the wedding, defendant, who was then 28 years old,: simply left a note for plaintiff
stating: "Will have to postpone wedding — My mother opposes it ... " He enplaned to his home city in
Mindanao, and the next day, the day before the wedding, he wired plaintiff: "Nothing changed rest
assured returning soon." But he never returned and was never heard from again.

Surely this is not a case of mere breach of promise to marry. As stated, mere breach of promise to marry
is not an actionable wrong. But to formally set a wedding and go through all the above-described
preparation and publicity, only to walk out of it when the matrimony is about to be solemnized, is quite
different. This is palpably and unjustifiably contrary to good customs for which defendant must be held
answerable in damages in accordance with Article 21 aforesaid.

Defendant urges in his afore-stated petition that the damages awarded were excessive. No question is
raised as to the award of actual damages. What defendant would really assert hereunder is that the award
of moral and exemplary damages, in the amount of P25,000.00, should be totally eliminated.

Per express provision of Article 2219 (10) of the New Civil Code, moral damages are recoverable in the
cases mentioned in Article 21 of said Code. As to exemplary damages, defendant contends that the same
could not be adjudged against him because under Article 2232 of the New Civil Code the condition
precedent is that "the defendant acted in a wanton, fraudulent, reckless, oppressive, or malevolent
manner." The argument is devoid of merit as under the above-narrated circumstances of this case
defendant clearly acted in a "wanton ... , reckless [and] oppressive manner." This Court's opinion,
however, is that considering the particular circumstances of this case, P15,000.00 as moral and exemplary
damages is deemed to be a reasonable award.

PREMISES CONSIDERED, with the above-indicated modification, the lower court's judgment is hereby
affirmed, with costs.

FIRST DIVISION

[G.R. No. 127358. March 31, 2005]

NOEL BUENAVENTURA, petitioner, vs. COURT OF APPEALS and ISABEL LUCIA SINGH
BUENAVENTURA, respondents.

[G.R. No. 127449. March 31, 2005]

NOEL BUENAVENTURA, petitioner, vs. COURT OF APPEALS and ISABEL LUCIA SINGH
BUENAVENTURA, respondents.

DECISION
AZCUNA, J.:

These cases involve a petition for the declaration of nullity of marriage, which was filed by petitioner
Noel Buenaventura on July 12, 1992, on the ground of the alleged psychological incapacity of his wife,
Isabel Singh Buenaventura, herein respondent. After respondent filed her answer, petitioner, with leave of
court, amended his petition by stating that both he and his wife were psychologically incapacitated to
comply with the essential obligations of marriage. In response, respondent filed an amended answer
denying the allegation that she was psychologically incapacitated.[1]
On July 31, 1995, the Regional Trial Court promulgated a Decision, the dispositive portion of which
reads:
WHEREFORE, judgment is hereby rendered as follows:
1) Declaring and decreeing the marriage entered into between plaintiff Noel A. Buenaventura
and defendant Isabel Lucia Singh Buenaventura on July 4, 1979, null and void ab initio;
2) Ordering the plaintiff to pay defendant moral damages in the amount of 2.5 million pesos and
exemplary damages of 1 million pesos with 6% interest from the date of this decision plus
attorneys fees of P100,000.00;
3) Ordering the plaintiff to pay the defendant expenses of litigation of P50,000.00, plus costs;
4) Ordering the liquidation of the assets of the conjugal partnership property[,] particularly the
plaintiffs separation/retirement benefits received from the Far East Bank [and] Trust
Company[,] by ceding, giving and paying to her fifty percent (50%) of the net amount
of P3,675,335.79 or P1,837,667.89 together with 12% interest per annum from the date of
this decision and one-half (1/2) of his outstanding shares of stock with Manila Memorial
Park and Provident Group of Companies;
5) Ordering him to give a regular support in favor of his son Javy Singh Buenaventura in the
amount of P15,000.00 monthly, subject to modification as the necessity arises;
6) Awarding the care and custody of the minor Javy Singh Buenaventura to his mother, the
herein defendant; and
7) Hereby authorizing the defendant to revert back to the use of her maiden family name Singh.
Let copies of this decision be furnished the appropriate civil registry and registries of properties.

SO ORDERED.[2]

Petitioner appealed the above decision to the Court of Appeals. While the case was pending in the
appellate court, respondent filed a motion to increase the P15,000 monthly supportpendente lite of their
son Javy Singh Buenaventura. Petitioner filed an opposition thereto, praying that it be denied or that such
incident be set for oral argument.[3]
On September 2, 1996, the Court of Appeals issued a Resolution increasing the support pendente
lite to P20,000.[4] Petitioner filed a motion for reconsideration questioning the said Resolution.[5]
On October 8, 1996, the appellate court promulgated a Decision dismissing petitioners appeal for
lack of merit and affirming in toto the trial courts decision.[6] Petitioner filed a motion for reconsideration
which was denied. From the abovementioned Decision, petitioner filed the instant Petition for Review
on Certiorari.
On November 13, 1996, through another Resolution, the Court of Appeals denied petitioners motion
for reconsideration of the September 2, 1996 Resolution, which increased the monthly support for the
son.[7] Petitioner filed a Petition for Certiorari to question these two Resolutions.
On July 9, 1997, the Petition for Review on Certiorari[8] and the Petition for Certiorari[9] were
ordered consolidated by this Court.[10]
In the Petition for Review on Certiorari petitioner claims that the Court of Appeals decided the case
not in accord with law and jurisprudence, thus:

1. WHEN IT AWARDED DEFENDANT-APPELLEE MORAL DAMAGES IN THE AMOUNT OF


P2.5 MILLION AND EXEMPLARY DAMAGES OF P1 MILLION, WITH 6% INTEREST FROM THE
DATE OF ITS DECISION, WITHOUT ANY LEGAL AND MORAL BASIS;

2. WHEN IT AWARDED P100,000.00 ATTORNEYS FEES AND P50,000.00 EXPENSES OF


LITIGATION, PLUS COSTS, TO DEFENDANT-APPELLEE, WITHOUT FACTUAL AND LEGAL
BASIS;

3. WHEN IT ORDERED PLAINTIFF-APPELLANT NOEL TO PAY DEFENDANT-APPELLEE ONE-


HALF OR P1,837,667.89 OUT OF HIS RETIREMENT BENEFITS RECEIVED FROM THE FAR
EAST BANK AND TRUST CO., WITH 12% INTEREST THEREON FROM THE DATE OF ITS
DECISION, NOTWITHSTANDING THAT SAID RETIREMENT BENEFITS ARE GRATUITOUS
AND EXCLUSIVE PROPERTY OF NOEL, AND ALSO TO DELIVER TO DEFENDANT-APPELLEE
ONE-HALF OF HIS SHARES OF STOCK WITH THE MANILA MEMORIAL PARK AND THE
PROVIDENT GROUP OF COMPANIES, ALTHOUGH SAID SHARES OF STOCK WERE
ACQUIRED BY NOEL BEFORE HIS MARRIAGE TO RESPONDENT ISABEL AND ARE,
THEREFORE, AGAIN HIS EXCLUSIVE PROPERTIES; AND

4. WHEN IT AWARDED EXCLUSIVE CARE AND CUSTODY OVER THE PARTIES MINOR
CHILD TO DEFENDANT-APPELLEE WITHOUT ASKING THE CHILD (WHO WAS ALREADY 13
YEARS OLD AT THAT TIME) HIS CHOICE AS TO WHOM, BETWEEN HIS TWO PARENTS, HE
WOULD LIKE TO HAVE CUSTODY OVER HIS PERSON.[11]

In the Petition for Certiorari, petitioner advances the following contentions:

THE COURT OF APPEALS GRAVELY ABUSED ITS DISCRETION WHEN IT REFUSED TO SET
RESPONDENTS MOTION FOR INCREASED SUPPORT FOR THE PARTIES SON FOR
HEARING.[12]

THERE WAS NO NEED FOR THE COURT OF APPEALS TO INCREASE JAVYS MONTHLY
SUPPORT OF P15,000.00 BEING GIVEN BY PETITIONER EVEN AT PRESENT PRICES.[13]

IN RESOLVING RESPONDENTS MOTION FOR THE INCREASE OF JAVYS SUPPORT, THE


COURT OF APPEALS SHOULD HAVE EXAMINED THE LIST OF EXPENSES SUBMITTED BY
RESPONDENT IN THE LIGHT OF PETITIONERS OBJECTIONS THERETO, INSTEAD OF
MERELY ASSUMING THAT JAVY IS ENTITLED TO A P5,000 INCREASE IN SUPPORT AS SAID
AMOUNT IS TOO MINIMAL.[14]

LIKEWISE, THE COURT OF APPEALS SHOULD HAVE GIVEN PETITIONER AN OPPORTUNITY


TO PROVE HIS PRESENT INCOME TO SHOW THAT HE CANNOT AFFORD TO INCREASE
JAVYS SUPPORT.[15]

With regard to the first issue in the main case, the Court of Appeals articulated:

On Assignment of Error C, the trial court, after findings of fact ascertained from the testimonies not only
of the parties particularly the defendant-appellee but likewise, those of the two psychologists, awarded
damages on the basis of Articles 21, 2217 and 2229 of the Civil Code of the Philippines.

Thus, the lower court found that plaintiff-appellant deceived the defendant-appellee into marrying him by
professing true love instead of revealing to her that he was under heavy parental pressure to marry and
that because of pride he married defendant-appellee; that he was not ready to enter into marriage as in fact
his career was and always would be his first priority; that he was unable to relate not only to defendant-
appellee as a husband but also to his son, Javy, as a father; that he had no inclination to make the marriage
work such that in times of trouble, he chose the easiest way out, that of leaving defendantappellee and
their son; that he had no desire to keep defendant-appellee and their son as proved by his reluctance and
later, refusal to reconcile after their separation; that the aforementioned caused defendant-appellee to
suffer mental anguish, anxiety, besmirched reputation, sleepless nights not only in those years the parties
were together but also after and throughout their separation.

Plaintiff-appellant assails the trial courts decision on the ground that unlike those arising from a breach in
ordinary contracts, damages arising as a consequence of marriage may not be awarded. While it is correct
that there is, as yet, no decided case by the Supreme Court where damages by reason of the performance
or non-performance of marital obligations were awarded, it does not follow that no such award for
damages may be made.

Defendant-appellee, in her amended answer, specifically prayed for moral and exemplary damages in the
total amount of 7 million pesos. The lower court, in the exercise of its discretion, found full justification
of awarding at least half of what was originally prayed for. We find no reason to disturb the ruling of the
trial court.[16]

The award by the trial court of moral damages is based on Articles 2217 and 21 of the Civil Code,
which read as follows:

ART. 2217. Moral damages include physical suffering, mental anguish, fright, serious anxiety,
besmirched reputation, wounded feelings, moral shock, social humiliation, and similar injury. Though
incapable of pecuniary computation, moral damages may be recovered if they are the proximate result of
the defendants wrongful act or omission.

ART. 21. Any person who wilfully causes loss or injury to another in a manner that is contrary to morals,
good customs or public policy shall compensate the latter for the damage.

The trial court referred to Article 21 because Article 2219[17] of the Civil Code enumerates the cases
in which moral damages may be recovered and it mentions Article 21 as one of the instances. It must be
noted that Article 21 states that the individual must willfully cause loss or injury to another. There is a
need that the act is willful and hence done in complete freedom. In granting moral damages, therefore, the
trial court and the Court of Appeals could not but have assumed that the acts on which the moral damages
were based were done willfully and freely, otherwise the grant of moral damages would have no leg to
stand on.
On the other hand, the trial court declared the marriage of the parties null and void based on Article
36 of the Family Code, due to psychological incapacity of the petitioner, Noel Buenaventura. Article 36
of the Family Code states:

A marriage contracted by any party who, at the time of the celebration, was psychologically incapacitated
to comply with the essential marital obligations of marriage, shall likewise be void even if such incapacity
becomes manifest only after its solemnization.
Psychological incapacity has been defined, thus:

. . . no less than a mental (not physical) incapacity that causes a party to be truly incognitive of the basic
marital covenants that concomitantly must be assumed and discharged by the parties to the
marriage which, as so expressed by Article 68 of the Family Code, include their mutual obligations to
live together, observe love, respect and fidelity and render help and support. There is hardly any doubt
that the intendment of the law has been to confine the meaning of "psychological incapacity" to the most
serious cases of personality disorders clearly demonstrative of an utter insensitivity or inability to give
meaning and significance to the marriage. . . .[18]

The Court of Appeals and the trial court considered the acts of the petitioner after the marriage as
proof of his psychological incapacity, and therefore a product of his incapacity or inability to comply with
the essential obligations of marriage. Nevertheless, said courts considered these acts as willful and hence
as grounds for granting moral damages. It is contradictory to characterize acts as a product of
psychological incapacity, and hence beyond the control of the party because of an innate inability, while
at the same time considering the same set of acts as willful. By declaring the petitioner as psychologically
incapacitated, the possibility of awarding moral damages on the same set of facts was negated. The award
of moral damages should be predicated, not on the mere act of entering into the marriage, but on specific
evidence that it was done deliberately and with malice by a party who had knowledge of his or her
disability and yet willfully concealed the same. No such evidence appears to have been adduced in this
case.
For the same reason, since psychological incapacity means that one is truly incognitive of the basic
marital covenants that one must assume and discharge as a consequence of marriage, it removes the basis
for the contention that the petitioner purposely deceived the private respondent. If the private respondent
was deceived, it was not due to a willful act on the part of the petitioner. Therefore, the award of moral
damages was without basis in law and in fact.
Since the grant of moral damages was not proper, it follows that the grant of exemplary damages
cannot stand since the Civil Code provides that exemplary damages are imposed in addition to moral,
temperate, liquidated or compensatory damages.[19]
With respect to the grant of attorneys fees and expenses of litigation the trial court explained, thus:

Regarding Attorneys fees, Art. 2208 of the Civil Code authorizes an award of attorneys fees and expenses
of litigation, other than judicial costs, when as in this case the plaintiffs act or omission has compelled the
defendant to litigate and to incur expenses of litigation to protect her interest (par. 2), and where the Court
deems it just and equitable that attorneys fees and expenses of litigation should be recovered. (par. 11)[20]

The Court of Appeals reasoned as follows:

On Assignment of Error D, as the award of moral and exemplary damages is fully justified, the award of
attorneys fees and costs of litigation by the trial court is likewise fully justified.[21]

The acts or omissions of petitioner which led the lower court to deduce his psychological incapacity,
and his act in filing the complaint for the annulment of his marriage cannot be considered as unduly
compelling the private respondent to litigate, since both are grounded on petitioners psychological
incapacity, which as explained above is a mental incapacity causing an utter inability to comply with the
obligations of marriage. Hence, neither can be a ground for attorneys fees and litigation expenses.
Furthermore, since the award of moral and exemplary damages is no longer justified, the award of
attorneys fees and expenses of litigation is left without basis.
Anent the retirement benefits received from the Far East Bank and Trust Co. and the shares of stock
in the Manila Memorial Park and the Provident Group of Companies, the trial court said:

The third issue that must be resolved by the Court is what to do with the assets of the conjugal partnership
in the event of declaration of annulment of the marriage. The Honorable Supreme Court has held that the
declaration of nullity of marriage carries ipso facto a judgment for the liquidation of property (Domingo
v. Court of Appeals, et al., G.R. No. 104818, Sept. 17, 1993, 226 SCRA, pp. 572 573, 586). Thus,
speaking through Justice Flerida Ruth P. Romero, it was ruled in this case:

When a marriage is declared void ab initio, the law states that the final judgment therein shall provide for
the liquidation, partition and distribution of the properties of the spouses, the custody and support of the
common children and the delivery of their presumptive legitimes, unless such matters had been
adjudicated in the previous proceedings.

The parties here were legally married on July 4, 1979, and therefore, all property acquired during the
marriage, whether the acquisition appears to have been made, contracted or registered in the name of one
or both spouses, is presumed to be conjugal unless the contrary is proved (Art. 116, New Family Code;
Art. 160, Civil Code). Art. 117 of the Family Code enumerates what are conjugal partnership properties.
Among others they are the following:

1) Those acquired by onerous title during the marriage at the expense of the common fund, whether the
acquisition be for the partnership, or for only one of the spouses;

2) Those obtained from the labor, industry, work or profession of either or both of the spouses;

3) The fruits, natural, industrial, or civil, due or received during the marriage from the common property,
as well as the net fruits from the exclusive property of each spouse. . . .

Applying the foregoing legal provisions, and without prejudice to requiring an inventory of what are the
parties conjugal properties and what are the exclusive properties of each spouse, it was disclosed during
the proceedings in this case that the plaintiff who worked first as Branch Manager and later as Vice-
President of Far East Bank & Trust Co. received separation/retirement package from the said bank in the
amount of P3,701,500.00 which after certain deductions amounting to P26,164.21 gave him a net amount
of P3,675,335.79 and actually paid to him on January 9, 1995 (Exhs. 6, 7, 8, 9, 10, 11). Not having shown
debts or obligations other than those deducted from the said retirement/separation pay, under Art. 129 of
the Family Code The net remainder of the conjugal partnership properties shall constitute the profits,
which shall be divided equally between husband and wife, unless a different proportion or division was
agreed upon in the marriage settlement or unless there has been a voluntary waiver or forfeiture of such
share as provided in this Code. In this particular case, however, there had been no marriage settlement
between the parties, nor had there been any voluntary waiver or valid forfeiture of the defendant wifes
share in the conjugal partnership properties. The previous cession and transfer by the plaintiff of his one-
half (1/2) share in their residential house and lot covered by T.C.T. No. S-35680 of the Registry of Deeds
of Paraaque, Metro Manila, in favor of the defendant as stipulated in their Compromise Agreement dated
July 12, 1993, and approved by the Court in its Partial Decision dated August 6, 1993, was actually
intended to be in full settlement of any and all demands for past support. In reality, the defendant wife had
allowed some concession in favor of the plaintiff husband, for were the law strictly to be followed, in the
process of liquidation of the conjugal assets, the conjugal dwelling and the lot on which it is situated
shall, unless otherwise agreed upon by the parties, be adjudicated to the spouse with whom their only
child has chosen to remain (Art. 129, par. 9). Here, what was done was one-half (1/2) portion of the house
was ceded to defendant so that she will not claim anymore for past unpaid support, while the other half
was transferred to their only child as his presumptive legitime.

Consequently, nothing yet has been given to the defendant wife by way of her share in the conjugal
properties, and it is but just, lawful and fair, that she be given one-half (1/2) share of the
separation/retirement benefits received by the plaintiff the same being part of their conjugal partnership
properties having been obtained or derived from the labor, industry, work or profession of said defendant
husband in accordance with Art. 117, par. 2 of the Family Code. For the same reason, she is entitled to
one-half (1/2) of the outstanding shares of stock of the plaintiff husband with the Manila Memorial Park
and the Provident Group of Companies.[22]

The Court of Appeals articulated on this matter as follows:

On Assignment of Error E, plaintiff-appellant assails the order of the trial court for him to give one-half
of his separation/retirement benefits from Far East Bank & Trust Company and half of his outstanding
shares in Manila Memorial Park and Provident Group of Companies to the defendant-appellee as the
latters share in the conjugal partnership.

On August 6, 1993, the trial court rendered a Partial Decision approving the Compromise Agreement
entered into by the parties. In the same Compromise Agreement, the parties had agreed that henceforth,
their conjugal partnership is dissolved. Thereafter, no steps were taken for the liquidation of the conjugal
partnership.
Finding that defendant-appellee is entitled to at least half of the separation/retirement benefits which
plaintiff-appellant received from Far East Bank & Trust Company upon his retirement as Vice-President
of said company for the reason that the benefits accrued from plaintiffappellants service for the bank for a
number of years, most of which while he was married to defendant-appellee, the trial court adjudicated
the same. The same is true with the outstanding shares of plaintiff-appellant in Manila Memorial Park and
Provident Group of Companies. As these were acquired by the plaintiff-appellant at the time he was
married to defendant-appellee, the latter is entitled to one-half thereof as her share in the conjugal
partnership. We find no reason to disturb the ruling of the trial court.[23]

Since the present case does not involve the annulment of a bigamous marriage, the provisions of
Article 50 in relation to Articles 41, 42 and 43 of the Family Code, providing for the dissolution of the
absolute community or conjugal partnership of gains, as the case may be, do not apply. Rather, the
general rule applies, which is that in case a marriage is declared voidab initio, the property regime
applicable and to be liquidated, partitioned and distributed is that of equal co-ownership.
In Valdes v. Regional Trial Court, Branch 102, Quezon City,[24] this Court expounded on the
consequences of a void marriage on the property relations of the spouses and specified the applicable
provisions of law:

The trial court correctly applied the law. In a void marriage, regardless of the cause thereof, the property
relations of the parties during the period of cohabitation is governed by the provisions of Article 147 or
Article 148, such as the case may be, of the Family Code. Article 147 is a remake of Article 144 of the
Civil Code as interpreted and so applied in previous cases; it provides:

ART. 147. When a man and a woman who are capacitated to marry each other, live exclusively with each
other as husband and wife without the benefit of marriage or under a void marriage, their wages and
salaries shall be owned by them in equal shares and the property acquired by both of them through their
work or industry shall be governed by the rules on co-ownership.

In the absence of proof to the contrary, properties acquired while they lived together shall be presumed to
have been obtained by their joint efforts, work or industry, and shall be owned by them in equal shares.
For purposes of this Article, a party who did not participate in the acquisition by the other party of any
property shall be deemed to have contributed jointly in the acquisition thereof if the former's efforts
consisted in the care and maintenance of the family and of the household.

Neither party can encumber or dispose by acts inter vivos of his or her share in the property acquired
during cohabitation and owned in common, without the consent of the other, until after the termination of
their cohabitation.

When only one of the parties to a void marriage is in good faith, the share of the party in bad faith in the
co-ownership shall be forfeited in favor of their common children. In case of default of or waiver by any
or all of the common children or their descendants, each vacant share shall belong to the respective
surviving descendants. In the absence of descendants, such share shall belong to the innocent party. In all
cases, the forfeiture shall take place upon termination of the cohabitation.

This peculiar kind of co-ownership applies when a man and a woman, suffering no legal impediment to
marry each other, so exclusively live together as husband and wife under a void marriage or without the
benefit of marriage. The term "capacitated" in the provision (in the first paragraph of the law) refers to
the legal capacity of a party to contract marriage, i.e., any "male or female of the age of eighteen years or
upwards not under any of the impediments mentioned in Articles 37 and 38" of the Code.

Under this property regime, property acquired by both spouses through their work and industry shall be
governed by the rules on equal co-ownership. Any property acquired during the union is prima facie
presumed to have been obtained through their joint efforts. A party who did not participate in the
acquisition of the property shall still be considered as having contributed thereto jointly if said party's
"efforts consisted in the care and maintenance of the family household." Unlike the conjugal partnership
of gains, the fruits of the couple's separate property are not included in the co-ownership.

Article 147 of the Family Code, in substance and to the above extent, has clarified Article 144 of the Civil
Code; in addition, the law now expressly provides that
(a) Neither party can dispose or encumber by act[s] inter vivos [of] his or her share in co-ownership
property, without the consent of the other, during the period of cohabitation; and

(b) In the case of a void marriage, any party in bad faith shall forfeit his or her share in the co-ownership
in favor of their common children; in default thereof or waiver by any or all of the common children, each
vacant share shall belong to the respective surviving descendants, or still in default thereof, to the
innocent party. The forfeiture shall take place upon the termination of the cohabitation or declaration of
nullity of the marriage.

In deciding to take further cognizance of the issue on the settlement of the parties' common property, the
trial court acted neither imprudently nor precipitately; a court which had jurisdiction to declare the
marriage a nullity must be deemed likewise clothed with authority to resolve incidental and consequential
matters. Nor did it commit a reversible error in ruling that petitioner and private respondent own the
"family home" and all their common property in equal shares, as well as in concluding that, in the
liquidation and partition of the property owned in common by them, the provisions on co-ownership
under the Civil Code, not Articles 50, 51 and 52, in relation to Articles 102 and 129, of the Family Code,
should aptly prevail. The rules set up to govern the liquidation of either the absolute community or the
conjugal partnership of gains, the property regimes recognized for valid and voidable marriages (in the
latter case until the contract is annulled), are irrelevant to the liquidation of the co-ownership that exists
between common-law spouses. The first paragraph of Article 50 of the Family Code, applying paragraphs
(2), (3), (4) and (5) of Article 43, relates only, by its explicit terms, to voidable marriages and,
exceptionally, to void marriages under Article 40 of the Code, i.e., the declaration of nullity of a
subsequent marriage contracted by a spouse of a prior void marriage before the latter is judicially declared
void. The latter is a special rule that somehow recognizes the philosophy and an old doctrine that void
marriages are inexistent from the very beginning and no judicial decree is necessary to establish their
nullity. In now requiring for purposes of remarriage, the declaration of nullity by final judgment of the
previously contracted void marriage, the present law aims to do away with any continuing uncertainty on
the status of the second marriage. It is not then illogical for the provisions of Article 43, in relation to
Articles 41 and 42, of the Family Code, on the effects of the termination of a subsequent marriage
contracted during the subsistence of a previous marriage to be made applicable pro hac vice. In all other
cases, it is not to be assumed that the law has also meant to have coincident property relations, on the one
hand, between spouses in valid and voidable marriages (before annulment) and, on the other, between
common-law spouses or spouses of void marriages, leaving to ordain, in the latter case, the ordinary rules
on co-ownership subject to the provision of Article 147 and Article 148 of the Family Code. It must be
stressed, nevertheless, even as it may merely state the obvious, that the provisions of the Family Code on
the "family home," i.e., the provisions found in Title V, Chapter 2, of the Family Code, remain in force
and effect regardless of the property regime of the spouses.[25]

Since the properties ordered to be distributed by the court a quo were found, both by the trial court
and the Court of Appeals, to have been acquired during the union of the parties, the same would be
covered by the co-ownership. No fruits of a separate property of one of the parties appear to have been
included or involved in said distribution. The liquidation, partition and distribution of the properties
owned in common by the parties herein as ordered by the court a quo should, therefore, be sustained, but
on the basis of co-ownership and not of the regime of conjugal partnership of gains.
As to the issue on custody of the parties over their only child, Javy Singh Buenaventura, it is now
moot since he is about to turn twenty-five years of age on May 27, 2005[26] and has, therefore, attained the
age of majority.
With regard to the issues on support raised in the Petition for Certiorari, these would also now be
moot, owing to the fact that the son, Javy Singh Buenaventura, as previously stated, has attained the age
of majority.
WHEREFORE, the Decision of the Court of Appeals dated October 8, 1996 and its Resolution
dated December 10, 1996 which are contested in the Petition for Review (G.R. No. 127449), are hereby
MODIFIED, in that the award of moral and exemplary damages, attorneys fees, expenses of litigation and
costs are deleted. The order giving respondent one-half of the retirement benefits of petitioner from Far
East Bank and Trust Co. and one-half of petitioners shares of stock in Manila Memorial Park and in the
Provident Group of Companies issustained but on the basis of the liquidation, partition and
distribution of the co-ownership and not of the regime of conjugal partnership of gains. The rest of
said Decision and Resolution are AFFIRMED.
The Petition for Review on Certiorari (G.R. No. 127358) contesting the Court of Appeals
Resolutions of September 2, 1996 and November 13, 1996 which increased the supportpendente lite in
favor of the parties son, Javy Singh Buenaventura, is now MOOT and ACADEMIC and is, accordingly,
DISMISSED.
No costs.
SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 158253 March 2, 2007

REPUBLIC OF THE PHILIPPINES, represented by the DEPARTMENT OF PUBLIC WORKS


AND HIGHWAYS, COMMISSION ON AUDIT and THE NATIONAL TREASURER, Petitioner,
vs.
CARLITO LACAP, doing business under the name and style CARWIN CONSTRUCTION AND
CONSTRUCTION SUPPLY, Respondent.

DECISION

AUSTRIA-MARTINEZ, J.:

Before the Court is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court
assailing the Decision1 dated April 28, 2003 of the Court of Appeals (CA) in CA-G.R. CV No. 56345
which affirmed with modification the Decision2 of the Regional Trial Court, Branch 41, San Fernando,
Pampanga (RTC) in Civil Case No. 10538, granting the complaint for Specific Performance and Damages
filed by Carlito Lacap (respondent) against the Republic of the Philippines (petitioner).

The factual background of the case is as follows:

The District Engineer of Pampanga issued and duly published an "Invitation To Bid" dated January 27,
1992. Respondent, doing business under the name and style Carwin Construction and Construction
Supply (Carwin Construction), was pre-qualified together with two other contractors. Since respondent
submitted the lowest bid, he was awarded the contract for the concreting of Sitio 5 Bahay Pare.3 On
November 4, 1992, a Contract Agreement was executed by respondent and petitioner.4 On September 25,
1992, District Engineer Rafael S. Ponio issued a Notice to Proceed with the concreting
of Sitio 5 Bahay Pare.5 Accordingly, respondent undertook the works, made advances for the purchase of
the materials and payment for labor costs.6

On October 29, 1992, personnel of the Office of the District Engineer of San Fernando, Pampanga
conducted a final inspection of the project and found it 100% completed in accordance with the approved
plans and specifications. Accordingly, the Office of the District Engineer issued Certificates of Final
Inspection and Final Acceptance.7

Thereafter, respondent sought to collect payment for the completed project.8 The DPWH prepared the
Disbursement Voucher in favor of petitioner.9 However, the DPWH withheld payment from respondent
after the District Auditor of the Commission on Audit (COA) disapproved the final release of funds on
the ground that the contractor’s license of respondent had expired at the time of the execution of the
contract. The District Engineer sought the opinion of the DPWH Legal Department on whether the
contracts of Carwin Construction for various Mount Pinatubo rehabilitation projects were valid and
effective although its contractor’s license had already expired when the projects were contracted.10

In a Letter-Reply dated September 1, 1993, Cesar D. Mejia, Director III of the DPWH Legal Department
opined that since Republic Act No. 4566 (R.A. No. 4566), otherwise known as the Contractor’s License
Law, does not provide that a contract entered into after the license has expired is void and there is no law
which expressly prohibits or declares void such contract, the contract is enforceable and payment may be
paid, without prejudice to any appropriate administrative liability action that may be imposed on the
contractor and the government officials or employees concerned.11
In a Letter dated July 4, 1994, the District Engineer requested clarification from the DPWH Legal
Department on whether Carwin Construction should be paid for works accomplished despite an expired
contractor’s license at the time the contracts were executed.12

In a First Indorsement dated July 20, 1994, Cesar D. Mejia, Director III of the Legal Department,
recommended that payment should be made to Carwin Construction, reiterating his earlier legal
opinion.13 Despite such recommendation for payment, no payment was made to respondent.

Thus, on July 3, 1995, respondent filed the complaint for Specific Performance and Damages against
petitioner before the RTC.14

On September 14, 1995, petitioner, through the Office of the Solicitor General (OSG), filed a Motion to
Dismiss the complaint on the grounds that the complaint states no cause of action and that the RTC had
no jurisdiction over the nature of the action since respondent did not appeal to the COA the decision of
the District Auditor to disapprove the claim.15

Following the submission of respondent’s Opposition to Motion to Dismiss,16 the RTC issued an Order
dated March 11, 1996 denying the Motion to Dismiss.17 The OSG filed a Motion for
Reconsideration18 but it was likewise denied by the RTC in its Order dated May 23, 1996.19

On August 5, 1996, the OSG filed its Answer invoking the defenses of non-exhaustion of administrative
remedies and the doctrine of non-suability of the State.20

Following trial, the RTC rendered on February 19, 1997 its Decision, the dispositive portion of which
reads as follows:

WHEREFORE, in view of all the foregoing consideration, judgment is hereby rendered in favor of the
plaintiff and against the defendant, ordering the latter, thru its District Engineer at Sindalan, San
Fernando, Pampanga, to pay the following:

a) P457,000.00 – representing the contract for the concreting project of Sitio 5 road, Bahay Pare,
Candaba, Pampanga plus interest at 12% from demand until fully paid; and

b) The costs of suit.

SO ORDERED.21

The RTC held that petitioner must be required to pay the contract price since it has accepted the
completed project and enjoyed the benefits thereof; to hold otherwise would be to overrun the long
standing and consistent pronouncement against enriching oneself at the expense of another.22

Dissatisfied, petitioner filed an appeal with the CA.23 On April 28, 2003, the CA rendered its Decision
sustaining the Decision of the RTC. It held that since the case involves the application of the principle of
estoppel against the government which is a purely legal question, then the principle of exhaustion of
administrative remedies does not apply; that by its actions the government is estopped from questioning
the validity and binding effect of the Contract Agreement with the respondent; that denial of payment to
respondent on purely technical grounds after successful completion of the project is not countenanced
either by justice or equity.

The CA rendered herein the assailed Decision dated April 28, 2003, the dispositive portion of which
reads:

WHEREFORE, the decision of the lower court is hereby AFFIRMED with modification in that the
interest shall be six percent (6%) per annum computed from June 21, 1995.

SO ORDERED.24

Hence, the present petition on the following ground:


THE COURT OF APPEALS ERRED IN NOT FINDING THAT RESPONDENT HAS NO CAUSE OF
ACTION AGAINST PETITIONER, CONSIDERING THAT:

(a) RESPONDENT FAILED TO EXHAUST ADMINISTRATIVE REMEDIES; AND

(b) IT IS THE COMMISSION ON AUDIT WHICH HAS THE PRIMARY JURISDICTION TO


RESOLVE RESPONDENT’S MONEY CLAIM AGAINST THE GOVERNMENT.25

Petitioner contends that respondent’s recourse to judicial action was premature since the proper remedy
was to appeal the District Auditor’s disapproval of payment to the COA, pursuant to Section 48,
Presidential Decree No. 1445 (P.D. No. 1445), otherwise known as the Government Auditing Code of the
Philippines; that the COA has primary jurisdiction to resolve respondent’s money claim against the
government under Section 2(1),26 Article IX of the 1987 Constitution and Section 2627 of P.D. No. 1445;
that non-observance of the doctrine of exhaustion of administrative remedies and the principle of primary
jurisdiction results in a lack of cause of action.

Respondent, on the other hand, in his Memorandum28 limited his discussion to Civil Code provisions
relating to human relations. He submits that equity demands that he be paid for the work performed;
otherwise, the mandate of the Civil Code provisions relating to human relations would be rendered
nugatory if the State itself is allowed to ignore and circumvent the standard of behavior it sets for its
inhabitants.

The present petition is bereft of merit.

The general rule is that before a party may seek the intervention of the court, he should first avail of all
the means afforded him by administrative processes.29 The issues which administrative agencies are
authorized to decide should not be summarily taken from them and submitted to a court without first
giving such administrative agency the opportunity to dispose of the same after due deliberation.30

Corollary to the doctrine of exhaustion of administrative remedies is the doctrine of primary jurisdiction;
that is, courts cannot or will not determine a controversy involving a question which is within the
jurisdiction of the administrative tribunal prior to the resolution of that question by the administrative
tribunal, where the question demands the exercise of sound administrative discretion requiring the special
knowledge, experience and services of the administrative tribunal to determine technical and intricate
matters of fact.31

Nonetheless, the doctrine of exhaustion of administrative remedies and the corollary doctrine of primary
jurisdiction, which are based on sound public policy and practical considerations, are not inflexible rules.
There are many accepted exceptions, such as: (a) where there is estoppel on the part of the party invoking
the doctrine; (b) where the challenged administrative act is patently illegal, amounting to lack of
jurisdiction; (c) where there is unreasonable delay or official inaction that will irretrievably prejudice the
complainant; (d) where the amount involved is relatively small so as to make the rule impractical and
oppressive; (e) where the question involved is purely legal and will ultimately have to be decided by the
courts of justice;32 (f) where judicial intervention is urgent; (g) when its application may cause great and
irreparable damage; (h) where the controverted acts violate due process; (i) when the issue of non-
exhaustion of administrative remedies has been rendered moot;33 (j) when there is no other plain, speedy
and adequate remedy; (k) when strong public interest is involved; and, (l) in quo warranto
proceedings.34 Exceptions (c) and (e) are applicable to the present case.

Notwithstanding the legal opinions of the DPWH Legal Department rendered in 1993 and 1994 that
payment to a contractor with an expired contractor’s license is proper, respondent remained unpaid for the
completed work despite repeated demands. Clearly, there was unreasonable delay and official inaction to
the great prejudice of respondent.

Furthermore, whether a contractor with an expired license at the time of the execution of its contract is
entitled to be paid for completed projects, clearly is a pure question of law. It does not involve an
examination of the probative value of the evidence presented by the parties. There is a question of law
when the doubt or difference arises as to what the law is on a certain state of facts, and not as to the truth
or the falsehood of alleged facts.35Said question at best could be resolved only tentatively by the
administrative authorities. The final decision on the matter rests not with them but with the courts of
justice. Exhaustion of administrative remedies does not apply, because nothing of an administrative
nature is to be or can be done.36 The issue does not require technical knowledge and experience but one
that would involve the interpretation and application of law.

Thus, while it is undisputed that the District Auditor of the COA disapproved respondent’s claim against
the Government, and, under Section 4837 of P.D. No. 1445, the administrative remedy available to
respondent is an appeal of the denial of his claim by the District Auditor to the COA itself, the Court
holds that, in view of exceptions (c) and (e) narrated above, the complaint for specific performance and
damages was not prematurely filed and within the jurisdiction of the RTC to resolve, despite the failure to
exhaust administrative remedies. As the Court aptly stated in Rocamora v. RTC-Cebu (Branch VIII):38

The plaintiffs were not supposed to hold their breath and wait until the Commission on Audit and the
Ministry of Public Highways had acted on the claims for compensation for the lands appropriated by the
government. The road had been completed; the Pope had come and gone; but the plaintiffs had yet to be
paid for the properties taken from them. Given this official indifference, which apparently would continue
indefinitely, the private respondents had to act to assert and protect their interests.39

On the question of whether a contractor with an expired license is entitled to be paid for completed
projects, Section 35 of R.A. No. 4566 explicitly provides:

SEC. 35. Penalties. Any contractor who, for a price, commission, fee or wage, submits or attempts to
submit a bid to construct, or contracts to or undertakes to construct, or assumes charge in a supervisory
capacity of a construction work within the purview of this Act, without first securing a license to engage
in the business of contracting in this country; or who shall present or file the license certificate of another,
give false evidence of any kind to the Board, or any member thereof in obtaining a certificate or license,
impersonate another, or use an expired or revoked certificate or license, shall be deemed guilty of
misdemeanor, and shall, upon conviction, be sentenced to pay a fine of not less than five hundred pesos
but not more than five thousand pesos. (Emphasis supplied)

The "plain meaning rule" or verba legis in statutory construction is that if the statute is clear, plain and
free from ambiguity, it must be given its literal meaning and applied without interpretation.40 This rule
derived from the maxim Index animi sermo est (speech is the index of intention) rests on the valid
presumption that the words employed by the legislature in a statute correctly express its intention or will
and preclude the court from construing it differently. The legislature is presumed to know the meaning of
the words, to have used words advisedly, and to have expressed its intent by use of such words as are
found in the statute.41 Verba legis non est recedendum, or from the words of a statute there should be no
departure.42

The wordings of R.A. No. 4566 are clear. It does not declare, expressly or impliedly, as void contracts
entered into by a contractor whose license had already expired. Nonetheless, such contractor is liable for
payment of the fine prescribed therein. Thus, respondent should be paid for the projects he completed.
Such payment, however, is without prejudice to the payment of the fine prescribed under the law.

Besides, Article 22 of the Civil Code which embodies the maxim Nemo ex alterius incommode debet
lecupletari (no man ought to be made rich out of another’s injury) states:

Art. 22. Every person who through an act of performance by another, or any other means, acquires or
comes into possession of something at the expense of the latter without just or legal ground, shall return
the same to him.

This article is part of the chapter of the Civil Code on Human Relations, the provisions of which were
formulated as "basic principles to be observed for the rightful relationship between human beings and for
the stability of the social order, x x x designed to indicate certain norms that spring from the fountain of
good conscience, x x x guides human conduct [that] should run as golden threads through society to the
end that law may approach its supreme ideal which is the sway and dominance of justice."43 The rules
thereon apply equally well to the Government.44 Since respondent had rendered services to the full
satisfaction and acceptance by petitioner, then the former should be compensated for them. To allow
petitioner to acquire the finished project at no cost would undoubtedly constitute unjust enrichment for
the petitioner to the prejudice of respondent. Such unjust enrichment is not allowed by law.

WHEREFORE, the present petition is DENIED for lack of merit. The assailed Decision of the Court of
Appeals dated April 28, 2003 in CA-G.R. CV No. 56345 is AFFIRMED. No pronouncement as to costs.
SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 86720 September 2, 1994

MHP GARMENTS, INC., and LARRY C. DE GUZMAN, petitioners,


vs.
THE HONORABLE COURT OF APPEALS, AGNES VILLA CRUZ, MIRASOL LUGATIMAN,
and GERTRUDES GONZALES, respondents.

Benjamin M. Dacanay for petitioners.

Emmanuel O. Tansingco for private respondents.

PUNO, J.:

The constitutional protection of our people against unreasonable search and seizure is not merely a
pleasing platitude. It vouchsafes our right to privacy and dignity against undesirable intrusions committed
by any public officer or private individual. An infringement of this right justifies an award for damages.

On February 22, 1983, petitioner MHP Garments, Inc., was awarded by the Boy Scouts of the
Philippines, the exclusive franchise to sell and distribute official Boy Scouts uniforms, supplies, badges,
and insignias. In their Memorandum Agreement, petitioner corporation was given the authority to
"undertake or cause to be undertaken the prosecution in court of all illegal sources of scout uniforms and
other scouting supplies." 1

Sometime in October 1983, petitioner corporation received information that private respondents Agnes
Villa Cruz, Mirasol Lugatiman, and Gertrudes Gonzales were selling Boy Scouts items and paraphernalia
without any authority. Petitioner de Guzman, an employee of petitioner corporation, was tasked to
undertake the necessary surveillance and to make a report to the Philippine Constabulary (PC).

On October 25, 1983, at about 10:30 A.M., petitioner de Guzman, Captain Renato M. Peñafiel, and two
(2) other constabulary men of the Reaction Force Battalion, Sikatuna Village, Diliman, Quezon City went
to the stores of respondents at the Marikina Public Market. Without any warrant, they seized the boy and
girl scouts pants, dresses, and suits on display at respondents' stalls. The seizure caused a commotion and
embarrassed private respondents. Receipts were issued for the seized items. The items were then turned
over by Captain Peñafiel to petitioner corporation for safekeeping.

A criminal complaint for unfair competition was then filed against private respondents. 2 During its
pendency, petitioner de Guzman exacted from private respondent Lugatiman the sum of THREE
THOUSAND ONE HUNDRED PESOS (P3,100.00) in order to be dropped from the complaint. On
December 6, 1983, after a preliminary investigation, the Provincial Fiscal of Rizal dismissed the
complaint against all the private respondents. On February 6, 1984, he also ordered the return of the
seized items. The seized items were not immediately returned despite demands. 3 Private respondents had
to go personally to petitioners' place of business to recover their goods. Even then, not all the seized items
were returned. The other items returned were of inferior quality.

Private respondents then filed Civil Case No. 51144 against the petitioners for sums of money and
damages. 4 In its Decision dated January 9, 1987, the trial court ruled for the private respondents, thus:
WHEREFORE, judgment is hereby rendered in favor of plaintiffs and against defendants,
ordering the latter jointly and severally:

1. To return the amount of P3,100.00 to plaintiff Mirasol Lugatiman with interest at 12%
per annum from January 12, 1984, the date of the last receipt issued, until fully paid;

2. To pay plaintiff Agnes Villa Cruz the sum of P2,000.00 for the 26 pieces of girl scout
items not returned;

3. To pay plaintiffs the amount of P50,000.00 for and as moral damages and P15,000.00
for and as exemplary damages; and

4. P5,000.00 for and as attorney's fees and litigation expenses.

Costs against the defendants.

SO ORDERED.

The decision was appealed to the respondent court. On January 18, 1989, its Fifth Division, 5 affirmed the
Decision with modification, thus:

WHEREFORE, the decision appealed from is AFFIRMED with MODIFICATION; and,


as modified, the dispositive portion thereof now reads as follows:

Judgment is hereby rendered in favor of plaintiffs (private respondents) and against


defendants (petitioners), ordering the latter jointly and severally;

1. To return the amount of P3,100.00 to plaintiff (respondent) Mirasol Lugatiman and


cancel her application for distributor's license;

2. To pay plaintiff (respondent) Agnes Villa Cruz the sum of P2,000.00 for the
unreturned 26 pieces of girl scouts items with interest at 12% per annum from June 4,
1984 (date the complaint was filed) until it is fully paid;

3. To pay plaintiffs (respondents) the amount of P10,000.00 each, or a total of


P30,000.00, for and as moral damages; and P5,000.00 each, or a total of P15,000.00, for
and as exemplary damages; and

4. To pay plaintiffs (respondents) P5,000.00 for and as attorney's fees and litigation
expenses.

Costs of the case a quo and the instant appeal are assessed jointly and severally against
defendants-appellants (petitioners) MHP Garments, Inc. and Larry de Guzman.

SO ORDERED.

In this petition for certiorari, petitioners contend:

FIRST ASSIGNMENT OF ERROR

THE COURT OF APPEALS ERRED IN IMPUTING LIABILITY FOR DAMAGES TO


THE PETITIONERS WHO DID NOT EFFECT THE SEIZURE OF THE SUBJECT
MERCHANDISE.

SECOND ASSIGNMENT OF ERROR

THE COURT OF APPEALS ERRED WHEN IT MADE A FINDING THAT THE


MANNER WITH WHICH THE CONFISCATION OF PRIVATE RESPONDENTS
WAS TORTIOUS BUT PENALIZED INSTEAD THE PETITIONERS WHO DID NOT
COMMIT THE ACT OF CONFISCATION.
THIRD ASSIGNMENT OF ERROR

THE COURT OF APPEALS ERRED WHEN IT FOUND FOR THE PRIVATE


RESPONDENTS AND AGAINST THE PETITIONERS.

We affirm.

Article III, section 2, of the Constitution protects our people from unreasonable search and seizure. It
provides:

The right of the people to be secure in their persons, houses, papers, and effects against
unreasonable searches and seizures of whatever nature for any purpose shall be
inviolable, and no search warrant or warrant of arrest shall issue except upon probable
cause to be determined personally by the judge after examination under oath or
affirmation of the complainant and the witnesses he may produce, and particularly
describing the place to be searched and the persons or things to be seized.

This provision protects not only those who appear to be innocent but also those who appear to be guilty
but are nevertheless to be presumed innocent until the contrary is proved. 6 In the case at bench, the
seizure was made without any warrant. Under the Rules of Court, 7 a warrantless search can only be
undertaken under the following circumstance:

Sec. 12. Search incident to a lawful arrest. - A person lawfully arrested may be searched
for dangerous weapons or anything which may be used as proof of the commission of an
offense, without a search warrant.

We hold that the evidence did not justify the warrantless search and seizure of private respondents' goods.
Petitioner corporation received information that private respondents were illegally selling Boy Scouts
items and paraphernalia in October 1983. The specific date and time are not established in the evidence
adduced by the parties. Petitioner de Guzman then made a surveillance of the stores of private
respondents. They reported to the Philippine Constabulary and on October 25, 1983, the raid was made on
the stores of private respondents and the supposed illicit goods were seized. The progression of time
between the receipt of the information and the raid of the stores of private respondents shows there was
sufficient time for petitioners and the PC raiding party to apply for a judicial warrant. Despite the
sufficiency of time, they did not apply for a warrant and seized the goods of private respondents. In doing
so, they took the risk of a suit for damages in case the seizure would be proved to violate the right of
private respondents against unreasonable search and seizure. In the case at bench, the search and seizure
were clearly illegal. There was no probable cause for the seizure. Probable cause for a search has been
defined as "such facts and circumstances which would lead a reasonably discreet and prudent man to
believe that an offense has been committed and that the objects sought in connection with the offense are
in the place sought to be searched." 8 These facts and circumstances were not in any way shown by the
petitioners to justify their warrantless search and seizure. Indeed, after a preliminary investigation, the
Provincial Fiscal of Rizal dismissed their complaint for unfair competition and later ordered the return of
the seized goods.

Petitioners would deflect their liability with the argument that it was the Philippine Constabulary that
conducted the raid and their participation was only to report the alleged illegal activity of private
respondents.

While undoubtedly, the members of the PC raiding team should have been included in the complaint for
violation of the private respondents' constitutional rights, still, the omission will not exculpate petitioners.

In the case of Lim vs. Ponce de Leon, 9 we ruled for the recovery of damages for violation of
constitutional rights and liberties from public officer or private individual, thus:

Art. 32. Any public officer or employee, or any private individual, who directly or
indirectly obstructs, defeats, violates or in any manner impedes or impairs any of the
following rights and liberties of another person shall be liable to the latter for damages.

xxx xxx xxx


(9) The rights to be secure in one's person, house, papers, and effects against
unreasonable searches and seizures.

xxx xxx xxx

The indemnity shall include moral damages. Exemplary damages may also be adjudged.

Art. 2219. Moral damages may be recovered in the following and analogous cases:

xxx xxx xxx

(6) Illegal search;

(1) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34, and 35.

Pursuant to the foregoing provisions, a person whose constitutional rights have been
violated or impaired is entitled to actual and moral damages from the public officer
or employee responsible therefor. In addition, exemplary damages may also be awarded.

xxx xxx xxx

The very nature of Article 32 is that the wrong may be civil or criminal. It is not
necessary therefore that there should be malice or bad faith. To make such a requisite
would defeat the main purpose of Article 32 which is the effective protection of
individual rights. Public officials in the past have abused their powers on the pretext of
justifiable motives or good faith in the performance of their duties. Precisely, the object
of the Article is to put an end to official abuse by plea of the good faith. In the United
States this remedy is in the nature of a tort. (emphasis supplied)

In the subsequent case of Aberca vs. Ver, 10 the Court En Banc explained the liability of persons indirectly
responsible,viz:

[T]he decisive factor in this case, in our view, is the language of Article 32. The law
speaks of an officer or employee or person "directly or indirectly" responsible for the
violation of the constitutional rights and liberties of another. Thus, it is not the actor alone
(i.e., the one directly responsible) who must answer for damages under Article 32; the
person indirectly responsible has also to answer for the damages or injury caused to the
aggrieved party.

xxx xxx xxx

While it would certainly be too naive to expect that violators of human rights would
easily be deterred by the prospect of facing damages suits, it should nonetheless be made
clear in no uncertain terms that Article 32 of the Civil Code makes the persons who are
directly, as well as indirectly, responsible for the transgression joint tortfeasors.

xxx xxx xxx

[N]either can it be said that only those shown to have participated "directly" should be
held liable. Article 32 of the Civil Code encompasses within the ambit of its provisions
those directly, as well as indirectly, responsible for its violations. (emphasis supplied)

Applying the aforecited provisions and leading cases, the respondent court correctly granted damages to
private respondents. Petitioners were indirectly involved in transgressing the right of private respondents
against unreasonable search and seizure. Firstly, they instigated the raid pursuant to their covenant in the
Memorandum Agreement to undertake the prosecution in court of all illegal sources of scouting
supplies. 11 As correctly observed by respondent court:

Indeed, the acts committed by the PC soldiers of unlawfully seizing appellees'


(respondents') merchandise and of filing the criminal complaint for unfair competition
against appellees (respondents) were for the protection and benefit of appellant
(petitioner) corporation. Such being the case, it is, thus, reasonably fair to infer from
those acts that it was upon appellant (petitioner) corporation's instance that the PC
soldiers conducted the raid and effected the illegal seizure. These circumstances should
answer the trial court's query — posed in its decision now under consideration — as to
why the PC soldiers immediately turned over the seized merchandise to appellant
(petitioner) corporation. 12

The raid was conducted with the active participation of their employee. Larry de Guzman did not lift a
finger to stop the seizure of the boy and girl scouts items. By standing by and apparently assenting
thereto, he was liable to the same extent as the officers themselves. 13 So with the petitioner corporation
which even received for safekeeping the goods unreasonably seized by the PC raiding team and de
Guzman, and refused to surrender them for quite a time despite the dismissal of its complaint for unfair
competition.

Secondly, Letter of Instruction No. 1299 was precisely crafted on March 9, 1983 to safeguard not only the
privilege of franchise holder of scouting items but also the citizen's constitutional rights, to wit:

TITLE: APPREHENSION OF UNAUTHORIZED


MANUFACTURERS AND DISTRIBUTORS OF SCOUT
PARAPHERNALIA AND IMPOUNDING OF SAID
PARAPHERNALIA.

ABSTRACT:

Directs all law enforcement agencies of the Republic of the Philippines, to apprehend
immediately unauthorized manufacturers and distributors of Scout paraphernalia, upon
proper application by the Boy Scouts of the Philippines and/or Girl Scouts of the
Philippines for warrant of arrest and/or search warrant with a judge, or such other
responsible officer as may be authorized by law; and to impound the said paraphernalia to
be used as evidence in court or other appropriate administrative body. Orders
the immediate and strict compliance with the Instructions. 14

Under the above provision and as aforediscussed, petitioners miserably failed to report the unlawful
peddling of scouting goods to the Boy Scouts of the Philippines for the proper application of a warrant.
Private respondents' rights are immutable and cannot be sacrificed to transient needs. 15 Petitioners did not
have the unbridled license to cause the seizure of respondents' goods without any warrant.

And thirdly, if petitioners did not have a hand in the raid, they should have filed a third-party complaint
against the raiding team for contribution or any other relief, 16 in respect of respondents' claim for
Recovery of Sum of Money with Damages. Again, they did not.

We have consistently ruled that moral damages are not awarded to penalize the defendant but to
compensate the plaintiff for the injuries he may have suffered. 17 Conformably with our ruling in Lim vs.
Ponce de Leon, op. cit., moral damages can be awarded in the case at bench. There can be no doubt that
petitioners must have suffered sleepless nights, serious anxiety, and wounded feelings due the tortious
raid caused by petitioners. Private respondents' avowals of embarrassment and humiliation during the
seizure of their merchandise were supported by their testimonies. Respondent Cruz declared:

I felt very nervous. I was crying to loss (sic) my goods and capital because I am doing
business with borrowed money only, there was commotion created by the raiding team
and they even stepped on some of the pants and dresses on display for sale. All passersby
stopped to watch and stared at me with accusing expressions. I was trembling and terribly
ashamed, sir. 18

Respondent Lugatiman testified:

I felt very nervous. I was crying and I was very much ashamed because many people
have been watching the PC soldiers hauling my items, and many/I (sic) heard say "nakaw
pala ang mga iyan" for which I am claiming P25,000.00 for damages. 19
While respondent Gonzalez stated thus:

I do not like the way the raid was conducted by the team sir because it looked like that
what I have been selling were stolen items that they should be confiscated by uniformed
soldiers. Many people were around and the more the confiscation was made in a
scandalous manner; every clothes, T-shirts, pants and dresses even those not wrapped
dropped to the ground. I was terribly shamed in the presence of market goers that
morning. 20

Needles to state, the wantonness of the wrongful seizure justifies the award of exemplary damages. 21 It
will also serve as a stern reminder to all and sundry that the constitutional protection against unreasonable
search and seizure is a virile reality and not a mere burst of rhetoric. The all encompassing protection
extends against intrusions directly done both by government and indirectly by private entities.

IN VIEW WHEREOF, the appealed decision is AFFIRMED WITH MODIFICATION. We impose a SIX
PERCENT (6%) interest from January 9, 1987 on the TWO THOUSAND PESOS (P2,000.00) for the
unreturned twenty-six (26) pieces of girl scouts items and a TWELVE PERCENT (12%) interest, in lieu
of SIX PERCENT (6%), on the said amount upon finality of this Decision until the payment
thereof. 22 Costs against petitioners.

SO ORDERED.

THIRD DIVISION

[G.R. No. 145391. August 26, 2002]

AVELINO CASUPANAN and ROBERTO CAPITULO, petitioners, vs. MARIO LLAVORE


LAROYA, respondent.

DECISION
CARPIO, J.:

The Case

This is a petition for review on certiorari to set aside the Resolution [1] dated December 28, 1999
dismissing the petition for certiorari and the Resolution[2] dated August 24, 2000 denying the motion for
reconsideration, both issued by the Regional Trial Court of Capas, Tarlac, Branch 66, in Special Civil
Action No. 17-C (99).

The Facts

Two vehicles, one driven by respondent Mario Llavore Laroya (Laroya for brevity) and the other
owned by petitioner Roberto Capitulo (Capitulo for brevity) and driven by petitioner Avelino Casupanan
(Casupanan for brevity), figured in an accident. As a result, two cases were filed with the Municipal
Circuit Trial Court (MCTC for brevity) of Capas, Tarlac. Laroya filed a criminal case against Casupanan
for reckless imprudence resulting in damage to property, docketed as Criminal Case No. 002-99. On the
other hand, Casupanan and Capitulo filed a civil case against Laroya for quasi-delict, docketed as Civil
Case No. 2089.
When the civil case was filed, the criminal case was then at its preliminary investigation stage.
Laroya, defendant in the civil case, filed a motion to dismiss the civil case on the ground of forum-
shopping considering the pendency of the criminal case. The MCTC granted the motion in the Order of
March 26, 1999 and dismissed the civil case.
On Motion for Reconsideration, Casupanan and Capitulo insisted that the civil case is a separate civil
action which can proceed independently of the criminal case. The MCTC denied the motion for
reconsideration in the Order of May 7, 1999. Casupanan and Capitulo filed a petition for certiorari under
Rule 65 before the Regional Trial Court (Capas RTC for brevity) of Capas, Tarlac, Branch 66,[3] assailing
the MCTCs Order of dismissal.

The Trial Courts Ruling

The Capas RTC rendered judgment on December 28, 1999 dismissing the petition for certiorari for
lack of merit. The Capas RTC ruled that the order of dismissal issued by the MCTC is a final order which
disposes of the case and therefore the proper remedy should have been an appeal. The Capas RTC further
held that a special civil action for certiorari is not a substitute for a lost appeal. Finally, the Capas RTC
declared that even on the premise that the MCTC erred in dismissing the civil case, such error is a pure
error of judgment and not an abuse of discretion.
Casupanan and Capitulo filed a Motion for Reconsideration but the Capas RTC denied the same in
the Resolution of August 24, 2000.
Hence, this petition.

The Issue

The petition premises the legal issue in this wise:

In a certain vehicular accident involving two parties, each one of them may think and believe that the
accident was caused by the fault of the other. x x x [T]he first party, believing himself to be the aggrieved
party, opted to file a criminal case for reckless imprudence against the second party. On the other hand,
the second party, together with his operator, believing themselves to be the real aggrieved parties, opted
in turn to file a civil case for quasi-delict against the first party who is the very private complainant in the
criminal case.[4]

Thus, the issue raised is whether an accused in a pending criminal case for reckless imprudence can
validly file, simultaneously and independently, a separate civil action for quasi-delict against the private
complainant in the criminal case.

The Courts Ruling

Casupanan and Capitulo assert that Civil Case No. 2089, which the MCTC dismissed on the ground
of forum-shopping, constitutes a counterclaim in the criminal case. Casupanan and Capitulo argue that if
the accused in a criminal case has a counterclaim against the private complainant, he may file the
counterclaim in a separate civil action at the proper time. They contend that an action on quasi-delict is
different from an action resulting from the crime of reckless imprudence, and an accused in a criminal
case can be an aggrieved party in a civil case arising from the same incident. They maintain that under
Articles 31 and 2176 of the Civil Code, the civil case can proceed independently of the criminal
action. Finally, they point out that Casupanan was not the only one who filed the independent civil action
based on quasi-delict but also Capitulo, the owner-operator of the vehicle, who was not a party in the
criminal case.
In his Comment, Laroya claims that the petition is fatally defective as it does not state the real
antecedents. Laroya further alleges that Casupanan and Capitulo forfeited their right to question the order
of dismissal when they failed to avail of the proper remedy of appeal. Laroya argues that there is no
question of law to be resolved as the order of dismissal is already final and a petition for certiorari is not a
substitute for a lapsed appeal.
In their Reply, Casupanan and Capitulo contend that the petition raises the legal question of whether
there is forum-shopping since they filed only one action - the independent civil action for quasi-
delict against Laroya.
Nature of the Order of Dismissal
The MCTC dismissed the civil action for quasi-delict on the ground of forum-shopping under
Supreme Court Administrative Circular No. 04-94. The MCTC did not state in its order of
dismissal[5] that the dismissal was with prejudice. Under the Administrative Circular, the order of
dismissal is without prejudice to refiling the complaint, unless the order of dismissal expressly states it is
with prejudice.[6] Absent a declaration that the dismissal is with prejudice, the same is deemed without
prejudice. Thus, the MCTCs dismissal, being silent on the matter, is a dismissal without prejudice.
Section 1 of Rule 41[7] provides that an order dismissing an action without prejudice is not
appealable. The remedy of the aggrieved party is to file a special civil action under Rule 65.Section 1 of
Rule 41 expressly states that where the judgment or final order is not appealable, the aggrieved party may
file an appropriate special civil action under Rule 65. Clearly, the Capas RTCs order dismissing the
petition for certiorari, on the ground that the proper remedy is an ordinary appeal, is erroneous.
Forum-Shopping
The essence of forum-shopping is the filing of multiple suits involving the same parties for the same
cause of action, either simultaneously or successively, to secure a favorable judgment. [8] Forum-shopping
is present when in the two or more cases pending, there is identity of parties, rights of action and reliefs
sought.[9] However, there is no forum-shopping in the instant case because the law and the rules expressly
allow the filing of a separate civil action which can proceed independently of the criminal action.
Laroya filed the criminal case for reckless imprudence resulting in damage to property based on the
Revised Penal Code while Casupanan and Capitulo filed the civil action for damages based on Article
2176 of the Civil Code. Although these two actions arose from the same act or omission, they have
different causes of action. The criminal case is based on culpa criminal punishable under the Revised
Penal Code while the civil case is based on culpa aquiliana actionable under Articles 2176 and 2177 of
the Civil Code. These articles on culpa aquiliana read:

Art. 2176. Whoever by act or omission causes damage to another, there being fault or negligence, is
obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing contractual
relation between the parties, is called a quasi-delict and is governed by the provisions of this Chapter.

Art. 2177. Responsibility for fault or negligence under the preceding article is entirely separate and
distinct from the civil liability arising from negligence under the Penal Code. But the plaintiff cannot
recover damages twice for the same act or omission of the defendant.

Any aggrieved person can invoke these articles provided he proves, by preponderance of evidence,
that he has suffered damage because of the fault or negligence of another. Either the private complainant
or the accused can file a separate civil action under these articles. There is nothing in the law or rules that
state only the private complainant in a criminal case may invoke these articles.
Moreover, paragraph 6, Section 1, Rule 111 of the 2000 Rules on Criminal Procedure (2000 Rules
for brevity) expressly requires the accused to litigate his counterclaim in a separate civil action, to wit:

SECTION 1. Institution of criminal and civil actions. (a) x x x.

No counterclaim, cross-claim or third-party complaint may be filed by the accused in the criminal case,
but any cause of action which could have been the subject thereof may be litigated in a separate civil
action. (Emphasis supplied)

Since the present Rules require the accused in a criminal action to file his counterclaim in a separate civil
action, there can be no forum-shopping if the accused files such separate civil action.
Filing of a separate civil action
Section 1, Rule 111 of the 1985 Rules on Criminal Procedure (1985 Rules for brevity), as amended
in 1988, allowed the filing of a separate civil action independently of the criminal action provided the
offended party reserved the right to file such civil action. Unless the offended party reserved the civil
action before the presentation of the evidence for the prosecution,all civil actions arising from the same
act or omission were deemed impliedly instituted in the criminal case. These civil actions referred to the
recovery of civil liability ex-delicto, the recovery of damages for quasi-delict, and the recovery of
damages for violation of Articles 32, 33 and 34 of the Civil Code on Human Relations.
Thus, to file a separate and independent civil action for quasi-delict under the 1985 Rules, the
offended party had to reserve in the criminal action the right to bring such action.Otherwise, such civil
action was deemed impliedly instituted in the criminal action. Section 1, Rule 111 of the 1985 Rules
provided as follows:

Section 1. Institution of criminal and civil actions. When a criminal action is instituted, the civil action for
the recovery of civil liability is impliedly instituted with the criminal action, unless the offended party
waives the action, reserves his right to institute it separately, or institutes the civil action prior to the
criminal action.

Such civil action includes recovery of indemnity under the Revised Penal Code, and damages under
Articles 32, 33, 34 and 2176 of the Civil Code of the Philippines arising from the same act or omission
of the accused.

A waiver of any of the civil actions extinguishes the others. The institution of, or the reservation of the
right to file, any of said civil actions separately waives the others.

The reservation of the right to institute the separate civil actions shall be made before the prosecution
starts to present its evidence and under circumstances affording the offended party a reasonable
opportunity to make such reservation.

In no case may the offended party recover damages twice for the same act or omission of the accused.

x x x. (Emphasis supplied)

Section 1, Rule 111 of the 1985 Rules was amended on December 1, 2000 and now provides as
follows:

SECTION 1. Institution of criminal and civil actions. (a) When a criminal action is instituted, the civil
action for the recovery of civil liability arising from the offense charged shall be deemed instituted with
the criminal action unless the offended party waives the civil action, reserves the right to institute it
separately or institutes the civil action prior to the criminal action.

The reservation of the right to institute separately the civil action shall be made before the prosecution
starts presenting its evidence and under circumstances affording the offended party a reasonable
opportunity to make such reservation.

xxx

(b) x x x

Where the civil action has been filed separately and trial thereof has not yet commenced, it may be
consolidated with the criminal action upon application with the court trying the latter case. If the
application is granted, the trial of both actions shall proceed in accordance with section 2 of this rule
governing consolidation of the civil and criminal actions. (Emphasis supplied)

Under Section 1 of the present Rule 111, what is deemed instituted with the criminal action is only
the action to recover civil liability arising from the crime or ex-delicto. All the other civil actions under
Articles 32, 33, 34 and 2176 of the Civil Code are no longer deemed instituted, and may be filed
separately and prosecuted independently even without any reservation in the criminal action. The failure
to make a reservation in the criminal action is not a waiver of the right to file a separate and independent
civil action based on these articles of the Civil Code.The prescriptive period on the civil actions based on
these articles of the Civil Code continues to run even with the filing of the criminal action. Verily, the
civil actions based on these articles of the Civil Code are separate, distinct and independent of the civil
action deemed instituted in the criminal action.[10]
Under the present Rule 111, the offended party is still given the option to file a separate civil action
to recover civil liability ex-delicto by reserving such right in the criminal action before the prosecution
presents its evidence. Also, the offended party is deemed to make such reservation if he files a separate
civil action before filing the criminal action. If the civil action to recover civil liability ex-delicto is filed
separately but its trial has not yet commenced, the civil action may be consolidated with the criminal
action. The consolidation under this Rule does not apply to separate civil actions arising from
the same act or omission filed under Articles 32, 33, 34 and 2176 of the Civil Code.[11]
Suspension of the Separate Civil Action
Under Section 2, Rule 111 of the amended 1985 Rules, a separate civil action, if reserved in the
criminal action, could not be filed until after final judgment was rendered in the criminal action. If the
separate civil action was filed before the commencement of the criminal action, the civil action, if still
pending, was suspended upon the filing of the criminal action until final judgment was rendered in the
criminal action. This rule applied only to the separate civil action filed to recover liability ex-delicto. The
rule did not apply to independent civil actions based on Articles 32, 33, 34 and 2176 of the Civil Code,
which could proceed independently regardless of the filing of the criminal action.
The amended provision of Section 2, Rule 111 of the 2000 Rules continues this procedure, to wit:

SEC. 2. When separate civil action is suspended. After the criminal action has been commenced, the
separate civil action arising therefrom cannot be instituted until final judgment has been entered in the
criminal action.

If the criminal action is filed after the said civil action has already been instituted, the latter shall be
suspended in whatever stage it may be found before judgment on the merits. The suspension shall last
until final judgment is rendered in the criminal action. Nevertheless, before judgment on the merits is
rendered in the civil action, the same may, upon motion of the offended party, be consolidated with the
criminal action in the court trying the criminal action. In case of consolidation, the evidence already
adduced in the civil action shall be deemed automatically reproduced in the criminal action without
prejudice to the right of the prosecution to cross-examine the witnesses presented by the offended party in
the criminal case and of the parties to present additional evidence. The consolidated criminal and civil
actions shall be tried and decided jointly.

During the pendency of the criminal action, the running of the period of prescription of the civil action
which cannot be instituted separately or whose proceeding has been suspended shall be tolled.

x x x. (Emphasis supplied)

Thus, Section 2, Rule 111 of the present Rules did not change the rule that the separate civil action, filed
to recover damages ex-delicto, is suspended upon the filing of the criminal action.Section 2 of the present
Rule 111 also prohibits the filing, after commencement of the criminal action, of a separate civil action to
recover damages ex-delicto.
When civil action may proceed independently
The crucial question now is whether Casupanan and Capitulo, who are not the offended parties in the
criminal case, can file a separate civil action against the offended party in the criminal case. Section 3,
Rule 111 of the 2000 Rules provides as follows:

SEC 3. When civil action may proceed independently. - In the cases provided in Articles 32, 33, 34 and
2176 of the Civil Code of the Philippines, the independent civil action may be brought by
the offendedparty. It shall proceed independently of the criminal action and shall require only a
preponderance of evidence. In no case, however, may the offended party recover damages twice for the
same act or omission charged in the criminal action. (Emphasis supplied)

Section 3 of the present Rule 111, like its counterpart in the amended 1985 Rules, expressly allows
the offended party to bring an independent civil action under Articles 32, 33, 34 and 2176 of the Civil
Code. As stated in Section 3 of the present Rule 111, this civil action shall proceed independently of the
criminal action and shall require only a preponderance of evidence.In no case, however, may the offended
party recover damages twice for the same act or omission charged in the criminal action.
There is no question that the offended party in the criminal action can file an independent civil action
for quasi-delict against the accused. Section 3 of the present Rule 111 expressly states that the offended
party may bring such an action but the offended party may not recover damages twice for the same act or
omission charged in the criminal action. Clearly, Section 3 of Rule 111 refers to the offended party in the
criminal action, not to the accused.
Casupanan and Capitulo, however, invoke the ruling in Cabaero vs. Cantos[12] where the Court held
that the accused therein could validly institute a separate civil action for quasi-delict against the private
complainant in the criminal case. In Cabaero, the accused in the criminal case filed his Answer with
Counterclaim for malicious prosecution. At that time the Court noted the absence of clear-cut rules
governing the prosecution on impliedly instituted civil actions and the necessary consequences and
implications thereof. Thus, the Court ruled that the trial court should confine itself to the criminal aspect
of the case and disregard any counterclaim for civil liability. The Court further ruled that the accused may
file a separate civil case against the offended party after the criminal case is terminated and/or in
accordance with the new Rules which may be promulgated. The Court explained that a cross-claim,
counterclaim or third-party complaint on the civil aspect will only unnecessarily complicate the
proceedings and delay the resolution of the criminal case.
Paragraph 6, Section 1 of the present Rule 111 was incorporated in the 2000 Rules precisely to
address the lacuna mentioned in Cabaero. Under this provision, the accused is barred from filing a
counterclaim, cross-claim or third-party complaint in the criminal case. However, the same provision
states that any cause of action which could have been the subject (of the counterclaim, cross-claim or
third-party complaint) may be litigated in a separate civil action. The present Rule 111 mandates the
accused to file his counterclaim in a separate civil action which shall proceed independently of the
criminal action, even as the civil action of the offended party is litigated in the criminal action.
Conclusion
Under Section 1 of the present Rule 111, the independent civil action in Articles 32, 33, 34 and 2176
of the Civil Code is not deemed instituted with the criminal action but may be filed separately by the
offended party even without reservation. The commencement of the criminal action does not suspend the
prosecution of the independent civil action under these articles of the Civil Code. The suspension in
Section 2 of the present Rule 111 refers only to the civil action arising from the crime, if such civil action
is reserved or filed before the commencement of the criminal action.
Thus, the offended party can file two separate suits for the same act or omission. The first a criminal
case where the civil action to recover civil liability ex-delicto is deemed instituted, and the other a civil
case for quasi-delict - without violating the rule on non-forum shopping. The two cases can proceed
simultaneously and independently of each other. The commencement or prosecution of the criminal
action will not suspend the civil action for quasi-delict. The only limitation is that the offended party
cannot recover damages twice for the same act or omission of the defendant. In most cases, the offended
party will have no reason to file a second civil action since he cannot recover damages twice for the same
act or omission of the accused. In some instances, the accused may be insolvent, necessitating the filing of
another case against his employer or guardians.
Similarly, the accused can file a civil action for quasi-delict for the same act or omission he is
accused of in the criminal case. This is expressly allowed in paragraph 6, Section 1 of the present Rule
111 which states that the counterclaim of the accused may be litigated in a separate civil action. This is
only fair for two reasons. First, the accused is prohibited from setting up any counterclaim in the civil
aspect that is deemed instituted in the criminal case. The accused is therefore forced to litigate separately
his counterclaim against the offended party. If the accused does not file a separate civil action for quasi-
delict, the prescriptive period may set in since the period continues to run until the civil action for quasi-
delict is filed.
Second, the accused, who is presumed innocent, has a right to invoke Article 2177 of the Civil Code,
in the same way that the offended party can avail of this remedy which is independent of the criminal
action. To disallow the accused from filing a separate civil action for quasi-delict, while refusing to
recognize his counterclaim in the criminal case, is to deny him due process of law, access to the courts,
and equal protection of the law.
Thus, the civil action based on quasi-delict filed separately by Casupanan and Capitulo is
proper. The order of dismissal by the MCTC of Civil Case No. 2089 on the ground of forum-shopping is
erroneous.
We make this ruling aware of the possibility that the decision of the trial court in the criminal case
may vary with the decision of the trial court in the independent civil action. This possibility has always
been recognized ever since the Civil Code introduced in 1950 the concept of an independent civil action
under Articles 32, 33, 34 and 2176 of the Code. But the law itself, in Article 31 of the Code, expressly
provides that the independent civil action may proceed independently of the criminal proceedings and
regardless of the result of the latter. InAzucena vs. Potenciano,[13] the Court declared:
x x x. There can indeed be no other logical conclusion than this, for to subordinate the civil action
contemplated in the said articles to the result of the criminal prosecution whether it be conviction or
acquittal would render meaningless the independent character of the civil action and the clear injunction
in Article 31 that this action 'may proceed independently of the criminal proceedings and regardless of the
result of the latter.

More than half a century has passed since the Civil Code introduced the concept of a civil action
separate and independent from the criminal action although arising from the same act or omission. The
Court, however, has yet to encounter a case of conflicting and irreconcilable decisions of trial courts, one
hearing the criminal case and the other the civil action for quasi-delict. The fear of conflicting and
irreconcilable decisions may be more apparent than real. In any event, there are sufficient remedies under
the Rules of Court to deal with such remote possibilities.
One final point. The Revised Rules on Criminal Procedure took effect on December 1, 2000 while
the MCTC issued the order of dismissal on December 28, 1999 or before the amendment of the rules. The
Revised Rules on Criminal Procedure must be given retroactive effect considering the well-settled rule
that -

x x x statutes regulating the procedure of the court will be construed as applicable to actions pending and
undetermined at the time of their passage. Procedural laws are retroactive in that sense and to that
extent.[14]

WHEREFORE, the petition for review on certiorari is hereby GRANTED. The Resolutions dated
December 28, 1999 and August 24, 2000 in Special Civil Action No. 17-C (99) are ANNULLED and
Civil Case No. 2089 is REINSTATED.
SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

EN BANC

G.R. No. 102007 September 2, 1994

PEOPLE OF THE PHILIPPINES, plaintiff-appellee,


vs.
ROGELIO BAYOTAS y CORDOVA, accused-appellant.

The Solicitor General for plaintiff-appellee.

Public Attorney's Office for accused-appellant.

ROMERO, J.:

In Criminal Case No. C-3217 filed before Branch 16, RTC Roxas City, Rogelio Bayotas y Cordova was
charged with Rape and eventually convicted thereof on June 19, 1991 in a decision penned by Judge
Manuel E. Autajay. Pending appeal of his conviction, Bayotas died on February 4, 1992 at
the National Bilibid Hospital due to cardio respiratory arrest secondary to hepatic encephalopathy
secondary to hipato carcinoma gastric malingering. Consequently, the Supreme Court in its Resolution of
May 20, 1992 dismissed the criminal aspect of the appeal. However, it required the Solicitor General to
file its comment with regard to Bayotas' civil liability arising from his commission of the offense charged.

In his comment, the Solicitor General expressed his view that the death of accused-appellant did not
extinguish his civil liability as a result of his commission of the offense charged. The Solicitor General,
relying on the case ofPeople v. Sendaydiego 1 insists that the appeal should still be resolved for the
purpose of reviewing his conviction by the lower court on which the civil liability is based.

Counsel for the accused-appellant, on the other hand, opposed the view of the Solicitor General arguing
that the death of the accused while judgment of conviction is pending appeal extinguishes both his
criminal and civil penalties. In support of his position, said counsel invoked the ruling of the Court of
Appeals in People v. Castillo and Ocfemia 2 which held that the civil obligation in a criminal case takes
root in the criminal liability and, therefore, civil liability is extinguished if accused should die before final
judgment is rendered.

We are thus confronted with a single issue: Does death of the accused pending appeal of his conviction
extinguish his civil liability?

In the aforementioned case of People v. Castillo, this issue was settled in the affirmative. This same issue
posed therein was phrased thus: Does the death of Alfredo Castillo affect both his criminal responsibility
and his civil liability as a consequence of the alleged crime?

It resolved this issue thru the following disquisition:

Article 89 of the Revised Penal Code is the controlling statute. It reads, in part:

Art. 89. How criminal liability is totally extinguished. — Criminal


liability is totally extinguished:

1. By the death of the convict, as to the personal penalties; and as to the


pecuniary penalties liability therefor is extinguished only when the death
of the offender occurs before final judgment;

With reference to Castillo's criminal liability, there is no question. The law is plain.
Statutory construction is unnecessary. Said liability is extinguished.

The civil liability, however, poses a problem. Such liability is extinguished only when the
death of the offender occurs before final judgment. Saddled upon us is the task of
ascertaining the legal import of the term "final judgment." Is it final judgment as
contradistinguished from an interlocutory order? Or, is it a judgment which is final and
executory?

We go to the genesis of the law. The legal precept contained in Article 89 of the Revised
Penal Code heretofore transcribed is lifted from Article 132 of the Spanish El Codigo
Penal de 1870 which, in part, recites:

La responsabilidad penal se extingue.

1. Por la muerte del reo en cuanto a las penas personales siempre, y


respecto a las pecuniarias, solo cuando a su fallecimiento no hubiere
recaido sentencia firme.

xxx xxx xxx

The code of 1870 . . . it will be observed employs the term "sentencia firme." What is
"sentencia firme" under the old statute?

XXVIII Enciclopedia Juridica Española, p. 473, furnishes the ready answer: It says:

SENTENCIA FIRME. La sentencia que adquiere la fuerza de las


definitivas por no haberse utilizado por las partes litigantes recurso
alguno contra ella dentro de los terminos y plazos legales concedidos al
efecto.
"Sentencia firme" really should be understood as one which is definite. Because, it is only
when judgment is such that, as Medina y Maranon puts it, the crime is confirmed — "en
condena determinada;" or, in the words of Groizard, the guilt of the accused becomes —
"una verdad legal." Prior thereto, should the accused die, according to Viada, "no hay
legalmente, en tal caso, ni reo, ni delito, ni responsabilidad criminal de ninguna clase."
And, as Judge Kapunan well explained, when a defendant dies before judgment becomes
executory, "there cannot be any determination by final judgment whether or not the
felony upon which the civil action might arise exists," for the simple reason that "there is
no party defendant." (I Kapunan, Revised Penal Code, Annotated, p. 421. Senator
Francisco holds the same view. Francisco, Revised Penal Code, Book One, 2nd ed., pp.
859-860)

The legal import of the term "final judgment" is similarly reflected in the Revised Penal
Code. Articles 72 and 78 of that legal body mention the term "final judgment" in the
sense that it is already enforceable. This also brings to mind Section 7, Rule 116 of the
Rules of Court which states that a judgment in a criminal case becomes final "after the
lapse of the period for perfecting an appeal or when the sentence has been partially or
totally satisfied or served, or the defendant has expressly waived in writing his right to
appeal."

By fair intendment, the legal precepts and opinions here collected funnel down to one
positive conclusion: The term final judgment employed in the Revised Penal Code means
judgment beyond recall. Really, as long as a judgment has not become executory, it
cannot be truthfully said that defendant is definitely guilty of the felony charged against
him.

Not that the meaning thus given to final judgment is without reason. For where, as in this
case, the right to institute a separate civil action is not reserved, the decision to be
rendered must, of necessity, cover "both the criminal and the civil aspects of the
case." People vs. Yusico (November 9, 1942), 2 O.G., No. 100, p. 964. See also: People
vs. Moll, 68 Phil., 626, 634; Francisco, Criminal Procedure, 1958 ed., Vol. I, pp. 234,
236. Correctly, Judge Kapunan observed that as "the civil action is based solely on the
felony committed and of which the offender might be found guilty, the death of the
offender extinguishes the civil liability." I Kapunan, Revised Penal Code,
Annotated, supra.

Here is the situation obtaining in the present case: Castillo's criminal liability is out. His
civil liability is sought to be enforced by reason of that criminal liability. But then, if we
dismiss, as we must, the criminal action and let the civil aspect remain, we will be faced
with the anomalous situation whereby we will be called upon to clamp civil liability in a
case where the source thereof — criminal liability — does not exist. And, as was well
stated in Bautista, et al. vs. Estrella, et al., CA-G.R.
No. 19226-R, September 1, 1958, "no party can be found and held criminally liable in a
civil suit," which solely would remain if we are to divorce it from the criminal
proceeding."

This ruling of the Court of Appeals in the Castillo case 3 was adopted by the Supreme Court in the cases
of People of the Philippines v. Bonifacio Alison, et al., 4 People of the Philippines v. Jaime Jose, et
al. 5 and People of the Philippines v.Satorre 6 by dismissing the appeal in view of the death of the accused
pending appeal of said cases.

As held by then Supreme Court Justice Fernando in the Alison case:

The death of accused-appellant Bonifacio Alison having been established, and


considering that there is as yet no final judgment in view of the pendency of the appeal,
the criminal and civil liability of the said accused-appellant Alison was extinguished by
his death (Art. 89, Revised Penal Code; Reyes' Criminal Law, 1971 Rev. Ed., p. 717,
citing People v. Castillo and Ofemia C.A., 56 O.G. 4045); consequently, the case against
him should be dismissed.
On the other hand, this Court in the subsequent cases of Buenaventura Belamala v. Marcelino
Polinar 7 andLamberto Torrijos v. The Honorable Court of Appeals 8 ruled differently. In the former, the
issue decided by this court was: Whether the civil liability of one accused of physical injuries who died
before final judgment is extinguished by his demise to the extent of barring any claim therefore against
his estate. It was the contention of the administrator-appellant therein that the death of the accused prior to
final judgment extinguished all criminal and civil liabilities resulting from the offense, in view of Article
89, paragraph 1 of the Revised Penal Code. However, this court ruled therein:

We see no merit in the plea that the civil liability has been extinguished, in view of the
provisions of the Civil Code of the Philippines of 1950 (Rep. Act No. 386) that became
operative eighteen years after the revised Penal Code. As pointed out by the Court below,
Article 33 of the Civil Code establishes a civil action for damages on account of physical
injuries, entirely separate and distinct from the criminal action.

Art. 33. In cases of defamation, fraud, and physical injuries, a civil action
for damages, entirely separate and distinct from the criminal action, may
be brought by the injured party. Such civil action shall proceed
independently of the criminal prosecution, and shall require only a
preponderance of evidence.

Assuming that for lack of express reservation, Belamala's civil action for damages was to
be considered instituted together with the criminal action still, since both proceedings
were terminated without final adjudication, the civil action of the offended party under
Article 33 may yet be enforced separately.

In Torrijos, the Supreme Court held that:

xxx xxx xxx

It should be stressed that the extinction of civil liability follows the extinction of the
criminal liability under Article 89, only when the civil liability arises from the criminal
act as its only basis. Stated differently, where the civil liability does not exist
independently of the criminal responsibility, the extinction of the latter by death, ipso
facto extinguishes the former, provided, of course, that death supervenes before final
judgment. The said principle does not apply in instant case wherein the civil liability
springs neither solely nor originally from the crime itself but from a civil contract of
purchase and sale. (Emphasis ours)

xxx xxx xxx

In the above case, the court was convinced that the civil liability of the accused who was charged
with estafa could likewise trace its genesis to Articles 19, 20 and 21 of the Civil Code since said
accused had swindled the first and second vendees of the property subject matter of the contract
of sale. It therefore concluded: "Consequently, while the death of the accused herein extinguished
his criminal liability including fine, his civil liability based on the laws of human relations
remains."

Thus it allowed the appeal to proceed with respect to the civil liability of the accused, notwithstanding the
extinction of his criminal liability due to his death pending appeal of his conviction.

To further justify its decision to allow the civil liability to survive, the court relied on the following
ratiocination: Since Section 21, Rule 3 of the Rules of Court 9 requires the dismissal of all money claims
against the defendant whose death occurred prior to the final judgment of the Court of First Instance
(CFI), then it can be inferred that actions for recovery of money may continue to be heard on appeal,
when the death of the defendant supervenes after the CFI had rendered its judgment. In such case,
explained this tribunal, "the name of the offended party shall be included in the title of the case as
plaintiff-appellee and the legal representative or the heirs of the deceased-accused should be substituted as
defendants-appellants."

It is, thus, evident that as jurisprudence evolved from Castillo to Torrijos, the rule established was that the
survival of the civil liability depends on whether the same can be predicated on sources of obligations
other than delict. Stated differently, the claim for civil liability is also extinguished together with the
criminal action if it were solely based thereon, i.e., civil liability ex delicto.

However, the Supreme Court in People v. Sendaydiego, et al. 10 departed from this long-established
principle of law. In this case, accused Sendaydiego was charged with and convicted by the lower court of
malversation thru falsification of public documents. Sendaydiego's death supervened during the pendency
of the appeal of his conviction.

This court in an unprecedented move resolved to dismiss Sendaydiego's appeal but only to the extent of
his criminal liability. His civil liability was allowed to survive although it was clear that such claim
thereon was exclusively dependent on the criminal action already extinguished. The legal import of such
decision was for the court to continue exercising appellate jurisdiction over the entire appeal, passing
upon the correctness of Sendaydiego's conviction despite dismissal of the criminal action, for the purpose
of determining if he is civilly liable. In doing so, this Court issued a Resolution of July 8, 1977 stating
thus:

The claim of complainant Province of Pangasinan for the civil liability survived
Sendaydiego because his death occurred after final judgment was rendered by the Court
of First Instance of Pangasinan, which convicted him of three complex crimes of
malversation through falsification and ordered him to indemnify the Province in the total
sum of P61,048.23 (should be P57,048.23).

The civil action for the civil liability is deemed impliedly instituted with the criminal
action in the absence of express waiver or its reservation in a separate action (Sec. 1, Rule
111 of the Rules of Court). The civil action for the civil liability is separate and distinct
from the criminal action (People and Manuel vs. Coloma, 105 Phil. 1287; Roa vs. De la
Cruz, 107 Phil. 8).

When the action is for the recovery of money and the defendant dies before final
judgment in the Court of First Instance, it shall be dismissed to be prosecuted in the
manner especially provided in Rule 87 of the Rules of Court (Sec. 21, Rule 3 of the Rules
of Court).

The implication is that, if the defendant dies after a money judgment had been rendered
against him by the Court of First Instance, the action survives him. It may be continued
on appeal (Torrijos vs. Court of Appeals, L-40336, October 24, 1975; 67 SCRA 394).

The accountable public officer may still be civilly liable for the funds improperly
disbursed although he has no criminal liability (U.S. vs. Elvina, 24 Phil. 230; Philippine
National Bank vs. Tugab, 66 Phil. 583).

In view of the foregoing, notwithstanding the dismissal of the appeal of the deceased
Sendaydiego insofar as his criminal liability is concerned, the Court Resolved to continue
exercising appellate jurisdiction over his possible civil liability for the money claims of
the Province of Pangasinan arising from the alleged criminal acts complained of, as if no
criminal case had been instituted against him, thus making applicable, in determining his
civil liability, Article 30 of the Civil Code . . . and, for that purpose, his counsel is
directed to inform this Court within ten (10) days of the names and addresses of the
decedent's heirs or whether or not his estate is under administration and has a duly
appointed judicial administrator. Said heirs or administrator will be substituted for the
deceased insofar as the civil action for the civil liability is concerned (Secs. 16 and 17,
Rule 3, Rules of Court).

Succeeding cases 11 raising the identical issue have maintained adherence to our ruling in Sendaydiego; in
other words, they were a reaffirmance of our abandonment of the settled rule that a civil liability solely
anchored on the criminal (civil liability ex delicto) is extinguished upon dismissal of the entire appeal due
to the demise of the accused.

But was it judicious to have abandoned this old ruling? A re-examination of our decision
in Sendaydiego impels us to revert to the old ruling.
To restate our resolution of July 8, 1977 in Sendaydiego: The resolution of the civil action impliedly
instituted in the criminal action can proceed irrespective of the latter's extinction due to death of the
accused pending appeal of his conviction, pursuant to Article 30 of the Civil Code and Section 21, Rule 3
of the Revised Rules of Court.

Article 30 of the Civil Code provides:

When a separate civil action is brought to demand civil liability arising from a criminal
offense, and no criminal proceedings are instituted during the pendency of the civil case,
a preponderance of evidence shall likewise be sufficient to prove the act complained of.

Clearly, the text of Article 30 could not possibly lend support to the ruling in Sendaydiego. Nowhere in its
text is there a grant of authority to continue exercising appellate jurisdiction over the accused's civil
liability ex delictowhen his death supervenes during appeal. What Article 30 recognizes is an alternative
and separate civil action which may be brought to demand civil liability arising from a criminal offense
independently of any criminal action. In the event that no criminal proceedings are instituted during the
pendency of said civil case, the quantum of evidence needed to prove the criminal act will have to be that
which is compatible with civil liability and that is, preponderance of evidence and not proof of guilt
beyond reasonable doubt. Citing or invoking Article 30 to justify the survival of the civil action despite
extinction of the criminal would in effect merely beg the question of whether civil liability ex
delicto survives upon extinction of the criminal action due to death of the accused during appeal of his
conviction. This is because whether asserted in
the criminal action or in a separate civil action, civil liability ex delicto is extinguished by the death of the
accused while his conviction is on appeal. Article 89 of the Revised Penal Code is clear on this matter:

Art. 89. How criminal liability is totally extinguished. — Criminal liability is totally
extinguished:

1. By the death of the convict, as to the personal penalties; and as to pecuniary penalties,
liability therefor is extinguished only when the death of the offender occurs before final
judgment;

xxx xxx xxx

However, the ruling in Sendaydiego deviated from the expressed intent of Article 89. It allowed claims
for civil liability ex delicto to survive by ipso facto treating the civil action impliedly instituted with the
criminal, as one filed under Article 30, as though no criminal proceedings had been filed but merely a
separate civil action. This had the effect of converting such claims from one which is dependent on the
outcome of the criminal action to an entirely new and separate one, the prosecution of which does not
even necessitate the filing of criminal proceedings. 12One would be hard put to pinpoint the statutory
authority for such a transformation. It is to be borne in mind that in recovering civil liability ex delicto,
the same has perforce to be determined in the criminal action, rooted as it is in the court's pronouncement
of the guilt or innocence of the accused. This is but to render fealty to the intendment of Article 100 of the
Revised Penal Code which provides that "every person criminally liable for a felony is also civilly liable."
In such cases, extinction of the criminal action due to death of the accused pending appeal inevitably
signifies the concomitant extinction of the civil liability. Mors Omnia Solvi. Death dissolves all things.

In sum, in pursuing recovery of civil liability arising from crime, the final determination of the criminal
liability is a condition precedent to the prosecution of the civil action, such that when the criminal action
is extinguished by the demise of accused-appellant pending appeal thereof, said civil action cannot
survive. The claim for civil liability springs out of and is dependent upon facts which, if true, would
constitute a crime. Such civil liability is an inevitable consequence of the criminal liability and is to be
declared and enforced in the criminal proceeding. This is to be distinguished from that which is
contemplated under Article 30 of the Civil Code which refers to the institution of a separate civil action
that does not draw its life from a criminal proceeding. The Sendaydiego resolution of July 8, 1977,
however, failed to take note of this fundamental distinction when it allowed the survival of the civil action
for the recovery of civil liability ex delicto by treating the same as a separate civil action referred to under
Article 30. Surely, it will take more than just a summary judicial pronouncement to authorize the
conversion of said civil action to an independent one such as that contemplated under Article 30.
Ironically however, the main decision in Sendaydiego did not apply Article 30, the resolution of July 8,
1977 notwithstanding. Thus, it was held in the main decision:

Sendaydiego's appeal will be resolved only for the purpose of showing his criminal
liability which is the basis of the civil liability for which his estate would be liable. 13

In other words, the Court, in resolving the issue of his civil liability, concomitantly made a determination
on whether Sendaydiego, on the basis of evidenced adduced, was indeed guilty beyond reasonable doubt
of committing the offense charged. Thus, it upheld Sendaydiego's conviction and pronounced the same as
thesource of his civil liability. Consequently, although Article 30 was not applied in the final
determination of Sendaydiego's civil liability, there was a reopening of the criminal action already
extinguished which served as basis for Sendaydiego's civil liability. We reiterate: Upon death of the
accused pending appeal of his conviction, the criminal action is extinguished inasmuch as there is no
longer a defendant to stand as the accused; the civil action instituted therein for recovery of civil
liability ex delicto is ipso facto extinguished, grounded as it is on the criminal.

Section 21, Rule 3 of the Rules of Court was also invoked to serve as another basis for
the Sendaydiegoresolution of July 8, 1977. In citing Sec. 21, Rule 3 of the Rules of Court, the Court made
the inference that civil actions of the type involved in Sendaydiego consist of money claims, the recovery
of which may be continued on appeal if defendant dies pending appeal of his conviction by holding his
estate liable therefor. Hence, the Court's conclusion:

"When the action is for the recovery of money" "and the defendant dies before final
judgment in the court of First Instance, it shall be dismissed to be prosecuted in the
manner especially provided" in Rule 87 of the Rules of Court (Sec. 21, Rule 3 of the
Rules of Court).

The implication is that, if the defendant dies after a money judgment had been rendered
against him by the Court of First Instance, the action survives him. It may be continued
on appeal.

Sadly, reliance on this provision of law is misplaced. From the standpoint of procedural law, this course
taken inSendaydiego cannot be sanctioned. As correctly observed by Justice Regalado:

xxx xxx xxx

I do not, however, agree with the justification advanced in


both Torrijos and Sendaydiego which, relying on the provisions of Section 21, Rule 3 of
the Rules of Court, drew the strained implication therefrom that where the civil liability
instituted together with the criminal liabilities had already passed beyond the judgment of
the then Court of First Instance (now the Regional Trial Court), the Court of Appeals can
continue to exercise appellate jurisdiction thereover despite the extinguishment of the
component criminal liability of the deceased. This pronouncement, which has been
followed in the Court's judgments subsequent and consonant
to Torrijos and Sendaydiego, should be set aside and abandoned as being clearly
erroneous and unjustifiable.

Said Section 21 of Rule 3 is a rule of civil procedure in ordinary civil actions. There is
neither authority nor justification for its application in criminal procedure to civil actions
instituted together with and as part of criminal actions. Nor is there any authority in law
for the summary conversion from the latter category of an ordinary civil action upon the
death of the offender. . . .

Moreover, the civil action impliedly instituted in a criminal proceeding for recovery of civil liability ex
delicto can hardly be categorized as an ordinary money claim such as that referred to in Sec. 21, Rule 3
enforceable before the estate of the deceased accused.

Ordinary money claims referred to in Section 21, Rule 3 must be viewed in light of the provisions of
Section 5, Rule 86 involving claims against the estate, which in Sendaydiego was held liable for
Sendaydiego's civil liability. "What are contemplated in Section 21 of Rule 3, in relation to Section 5 of
Rule 86, 14 are contractual money claims while the claims involved in civil liability ex delicto may include
even the restitution of personal or real property." 15 Section 5, Rule 86 provides an exclusive enumeration
of what claims may be filed against the estate. These are: funeral expenses, expenses for the last illness,
judgments for money and claim arising from contracts, expressed or implied. It is clear that money claims
arising from delict do not form part of this exclusive enumeration. Hence, there could be no legal basis in
(1) treating a civil action ex delicto as an ordinary contractual money claim referred to in Section 21, Rule
3 of the Rules of Court and (2) allowing it to survive by filing a claim therefor before the estate of the
deceased accused. Rather, it should be extinguished upon extinction of the criminal action engendered by
the death of the accused pending finality of his conviction.

Accordingly, we rule: if the private offended party, upon extinction of the civil liability ex delicto desires
to recover damages from the same act or omission complained of, he must subject to Section 1, Rule
111 16 (1985 Rules on Criminal Procedure as amended) file a separate civil action, this time predicated
not on the felony previously charged but on other sources of obligation. The source of obligation upon
which the separate civil action is premised determines against whom the same shall be enforced.

If the same act or omission complained of also arises from quasi-delict or may, by provision of law, result
in an injury to person or property (real or personal), the separate civil action must be filed against the
executor or administrator 17 of the estate of the accused pursuant to Sec. 1, Rule 87 of the Rules of Court:

Sec. 1. Actions which may and which may not be brought against executor or
administrator. — No action upon a claim for the recovery of money or debt or interest
thereon shall be commenced against the executor or administrator; but actions to recover
real or personal property, or an interest therein, from the estate, or to enforce a lien
thereon, and actions to recover damages for an injury to person or property, real or
personal, may be commenced against him.

This is in consonance with our ruling in Belamala 18 where we held that, in recovering damages for injury
to persons thru an independent civil action based on Article 33 of the Civil Code, the same must be filed
against the executor or administrator of the estate of deceased accused and not against the estate under
Sec. 5, Rule 86 because this rule explicitly limits the claim to those for funeral expenses, expenses for the
last sickness of the decedent, judgment for money and claims arising from contract, express or implied.
Contractual money claims, we stressed, refers only to purely personal obligations other than those which
have their source in delict or tort.

Conversely, if the same act or omission complained of also arises from contract, the separate civil action
must be filed against the estate of the accused, pursuant to Sec. 5, Rule 86 of the Rules of Court.

From this lengthy disquisition, we summarize our ruling herein:

1. Death of the accused pending appeal of his conviction extinguishes his criminal liability as well as the
civil liability based solely thereon. As opined by Justice Regalado, in this regard, "the death of the
accused prior to final judgment terminates his criminal liability and only the civil liability directly arising
from and based solely on the offense committed, i.e., civil liability ex delicto in senso strictiore."

2. Corollarily, the claim for civil liability survives notwithstanding the death of accused, if the same may
also be predicated on a source of obligation other than delict. 19 Article 1157 of the Civil Code enumerates
these other sources of obligation from which the civil liability may arise as a result of the same act or
omission:

a) Law 20

b) Contracts

c) Quasi-contracts

d) . . .

e) Quasi-delicts

3. Where the civil liability survives, as explained in Number 2 above, an action for recovery therefor may
be pursued but only by way of filing a separate civil action and subject to Section 1, Rule 111 of the 1985
Rules on Criminal Procedure as amended. This separate civil action may be enforced either against the
executor/administrator or the estate of the accused, depending on the source of obligation upon which the
same is based as explained above.

4. Finally, the private offended party need not fear a forfeiture of his right to file this separate civil action
by prescription, in cases where during the prosecution of the criminal action and prior to its extinction, the
private-offended party instituted together therewith the civil action. In such case, the statute of limitations
on the civil liability is deemed interrupted during the pendency of the criminal case, conformably with
provisions of Article 1155 21 of the Civil Code, that should thereby avoid any apprehension on a possible
privation of right by prescription. 22

Applying this set of rules to the case at bench, we hold that the death of appellant Bayotas extinguished
his criminal liability and the civil liability based solely on the act complained of, i.e., rape. Consequently,
the appeal is hereby dismissed without qualification.

WHEREFORE, the appeal of the late Rogelio Bayotas is DISMISSED with costs de oficio.

SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 155223 April 4, 2007

BOBIE ROSE V. FRIAS, represented by her Attorney-in-fact, MARIE F. FUJITA, Petitioner,


vs.
FLORA SAN DIEGO-SISON, Respondent.

DECISION

AUSTRIA-MARTINEZ, J.:

Before us is a Petition for Review on Certiorari filed by Bobie Rose V. Frias represented by her
Attorney-in-fact, Marie Regine F. Fujita (petitioner) seeking to annul the Decision1 dated June 18, 2002
and the Resolution2 dated September 11, 2002 of the Court of Appeals (CA) in CA-G.R. CV No. 52839.

Petitioner is the owner of a house and lot located at No. 589 Batangas East, Ayala Alabang, Muntinlupa,
Metro Manila, which she acquired from Island Masters Realty and Development Corporation (IMRDC)
by virtue of a Deed of Sale dated Nov. 16, 1990.3 The property is covered by TCT No. 168173 of the
Register of Deeds of Makati in the name of IMRDC.4

On December 7, 1990, petitioner, as the FIRST PARTY, and Dra. Flora San Diego-Sison (respondent), as
the SECOND PARTY, entered into a Memorandum of Agreement5 over the property with the following
terms:

NOW, THEREFORE, for and in consideration of the sum of THREE MILLION PESOS (P3,000,000.00)
receipt of which is hereby acknowledged by the FIRST PARTY from the SECOND PARTY, the parties
have agreed as follows:

1. That the SECOND PARTY has a period of Six (6) months from the date of the execution of
this contract within which to notify the FIRST PARTY of her intention to purchase the
aforementioned parcel of land together within (sic) the improvements thereon at the price of SIX
MILLION FOUR HUNDRED THOUSAND PESOS (P6,400,000.00). Upon notice to the FIRST
PARTY of the SECOND PARTY’s intention to purchase the same, the latter has a period of
another six months within which to pay the remaining balance of P3.4 million.
2. That prior to the six months period given to the SECOND PARTY within which to decide
whether or not to purchase the above-mentioned property, the FIRST PARTY may still offer the
said property to other persons who may be interested to buy the same provided that the amount
of P3,000,000.00 given to the FIRST PARTY BY THE SECOND PARTY shall be paid to the
latter including interest based on prevailing compounded bank interest plus the amount of the sale
in excess of P7,000,000.00 should the property be sold at a price more than P7 million.

3. That in case the FIRST PARTY has no other buyer within the first six months from the
execution of this contract, no interest shall be charged by the SECOND PARTY on the P3 million
however, in the event that on the sixth month the SECOND PARTY would decide not to
purchase the aforementioned property, the FIRST PARTY has a period of another six months
within which to pay the sum of P3 million pesos provided that the said amount shall earn
compounded bank interest for the last six months only. Under this circumstance, the amount of
P3 million given by the SECOND PARTY shall be treated as [a] loan and the property shall be
considered as the security for the mortgage which can be enforced in accordance with law.

x x x x.6

Petitioner received from respondent two million pesos in cash and one million pesos in a post-dated check
dated February 28, 1990, instead of 1991, which rendered said check stale.7 Petitioner then gave
respondent TCT No. 168173 in the name of IMRDC and the Deed of Absolute Sale over the property
between petitioner and IMRDC.

Respondent decided not to purchase the property and notified petitioner through a letter8 dated March 20,
1991, which petitioner received only on June 11, 1991,9 reminding petitioner of their agreement that the
amount of two million pesos which petitioner received from respondent should be considered as a loan
payable within six months. Petitioner subsequently failed to pay respondent the amount of two million
pesos.

On April 1, 1993, respondent filed with the Regional Trial Court (RTC) of Manila, a complaint10 for sum
of money with preliminary attachment against petitioner. The case was docketed as Civil Case No. 93-
65367 and raffled to Branch 30. Respondent alleged the foregoing facts and in addition thereto averred
that petitioner tried to deprive her of the security for the loan by making a false report 11 of the loss of her
owner’s copy of TCT No. 168173 to the Tagig Police Station on June 3, 1991, executing an affidavit of
loss and by filing a petition12 for the issuance of a new owner’s duplicate copy of said title with the RTC
of Makati, Branch 142; that the petition was granted in an Order13 dated August 31, 1991; that said Order
was subsequently set aside in an Order dated April 10, 199214where the RTC Makati granted respondent’s
petition for relief from judgment due to the fact that respondent is in possession of the owner’s duplicate
copy of TCT No. 168173, and ordered the provincial public prosecutor to conduct an investigation of
petitioner for perjury and false testimony. Respondent prayed for the ex-parte issuance of a writ of
preliminary attachment and payment of two million pesos with interest at 36% per annum from December
7, 1991, P100,000.00 moral, corrective and exemplary damages and P200,000.00 for attorney’s fees.

In an Order dated April 6, 1993, the Executive Judge of the RTC of Manila issued a writ of preliminary
attachment upon the filing of a bond in the amount of two million pesos.15

Petitioner filed an Amended Answer16 alleging that the Memorandum of Agreement was conceived and
arranged by her lawyer, Atty. Carmelita Lozada, who is also respondent’s lawyer; that she was asked to
sign the agreement without being given the chance to read the same; that the title to the property and the
Deed of Sale between her and the IMRDC were entrusted to Atty. Lozada for safekeeping and were never
turned over to respondent as there was no consummated sale yet; that out of the two million pesos cash
paid, Atty. Lozada took the one million pesos which has not been returned, thus petitioner had filed a civil
case against her; that she was never informed of respondent’s decision not to purchase the property within
the six month period fixed in the agreement; that when she demanded the return of TCT No. 168173 and
the Deed of Sale between her and the IMRDC from Atty. Lozada, the latter gave her these documents in a
brown envelope on May 5, 1991 which her secretary placed in her attache case; that the envelope together
with her other personal things were lost when her car was forcibly opened the following day; that she
sought the help of Atty. Lozada who advised her to secure a police report, to execute an affidavit of loss
and to get the services of another lawyer to file a petition for the issuance of an owner’s duplicate copy;
that the petition for the issuance of a new owner’s duplicate copy was filed on her behalf without her
knowledge and neither did she sign the petition nor testify in court as falsely claimed for she was abroad;
that she was a victim of the manipulations of Atty. Lozada and respondent as shown by the filing of
criminal charges for perjury and false testimony against her; that no interest could be due as there was no
valid mortgage over the property as the principal obligation is vitiated with fraud and deception. She
prayed for the dismissal of the complaint, counter-claim for damages and attorney’s fees.

Trial on the merits ensued. On January 31, 1996, the RTC issued a decision,17 the dispositive portion of
which reads:

WHEREFORE, judgment is hereby RENDERED:

1) Ordering defendant to pay plaintiff the sum of P2 Million plus interest thereon at the rate of
thirty two (32%) per cent per annum beginning December 7, 1991 until fully paid.

2) Ordering defendant to pay plaintiff the sum of P70,000.00 representing premiums paid by
plaintiff on the attachment bond with legal interest thereon counted from the date of this decision
until fully paid.

3) Ordering defendant to pay plaintiff the sum of P100,000.00 by way of moral, corrective and
exemplary damages.

4) Ordering defendant to pay plaintiff attorney’s fees of P100,000.00 plus cost of litigation.18

The RTC found that petitioner was under obligation to pay respondent the amount of two million pesos
with compounded interest pursuant to their Memorandum of Agreement; that the fraudulent scheme
employed by petitioner to deprive respondent of her only security to her loaned money when petitioner
executed an affidavit of loss and instituted a petition for the issuance of an owner’s duplicate title
knowing the same was in respondent’s possession, entitled respondent to moral damages; and that
petitioner’s bare denial cannot be accorded credence because her testimony and that of her witness did not
appear to be credible.

The RTC further found that petitioner admitted that she received from respondent the two million pesos in
cash but the fact that petitioner gave the one million pesos to Atty. Lozada was without respondent’s
knowledge thus it is not binding on respondent; that respondent had also proven that in 1993, she initially
paid the sum ofP30,000.00 as premium for the issuance of the attachment bond, P20,000.00 for its
renewal in 1994, andP20,000.00 for the renewal in 1995, thus plaintiff should be reimbursed considering
that she was compelled to go to court and ask for a writ of preliminary attachment to protect her rights
under the agreement.

Petitioner filed her appeal with the CA. In a Decision dated June 18, 2002, the CA affirmed the RTC
decision with modification, the dispositive portion of which reads:

WHEREFORE, premises considered, the decision appealed from is MODIFIED in the sense that the rate
of interest is reduced from 32% to 25% per annum, effective June 7, 1991 until fully paid.19

The CA found that: petitioner gave the one million pesos to Atty. Lozada partly as her commission and
partly as a loan; respondent did not replace the mistakenly dated check of one million pesos because she
had decided not to buy the property and petitioner knew of her decision as early as April 1991; the award
of moral damages was warranted since even granting petitioner had no hand in the filing of the petition
for the issuance of an owner’s copy, she executed an affidavit of loss of TCT No. 168173 when she knew
all along that said title was in respondent’s possession; petitioner’s claim that she thought the title was
lost when the brown envelope given to her by Atty. Lozada was stolen from her car was hollow; that such
deceitful conduct caused respondent serious anxiety and emotional distress.

The CA concluded that there was no basis for petitioner to say that the interest should be charged for six
months only and no more; that a loan always bears interest otherwise it is not a loan; that interest should
commence on June 7, 199120 with compounded bank interest prevailing at the time the two million was
considered as a loan which was in June 1991; that the bank interest rate for loans secured by a real estate
mortgage in 1991 ranged from 25% to 32% per annum as certified to by Prudential Bank,21 that in
fairness to petitioner, the rate to be charged should be 25% only.

Petitioner’s motion for reconsideration was denied by the CA in a Resolution dated September 11, 2002.
Hence the instant Petition for Review on Certiorari filed by petitioner raising the following issues:

(A) WHETHER OR NOT THE COMPOUNDED BANK INTEREST SHOULD BE LIMITED


TO SIX (6) MONTHS AS CONTAINED IN THE MEMORANDUM OF AGREEMENT.

(B) WHETHER OR NOT THE RESPONDENT IS ENTITLED TO MORAL DAMAGES.

(C) WHETHER OR NOT THE GRANT OF CORRECTIVE AND EXEMPLARY DAMAGES


AND ATTORNEY’S FEES IS PROPER EVEN IF NOT MENTIONED IN THE TEXT OF THE
DECISION.22

Petitioner contends that the interest, whether at 32% per annum awarded by the trial court or at 25% per
annum as modified by the CA which should run from June 7, 1991 until fully paid, is contrary to the
parties’ Memorandum of Agreement; that the agreement provides that if respondent would decide not to
purchase the property, petitioner has the period of another six months to pay the loan with compounded
bank interest for the last six months only; that the CA’s ruling that a loan always bears interest otherwise
it is not a loan is contrary to Art. 1956 of the New Civil Code which provides that no interest shall be due
unless it has been expressly stipulated in writing.

We are not persuaded.

While the CA’s conclusion, that a loan always bears interest otherwise it is not a loan, is flawed since a
simple loan may be gratuitous or with a stipulation to pay interest,23 we find no error committed by the
CA in awarding a 25% interest per annum on the two-million peso loan even beyond the second six
months stipulated period.

The Memorandum of Agreement executed between the petitioner and respondent on December 7, 1990 is
the law between the parties. In resolving an issue based upon a contract, we must first examine the
contract itself, especially the provisions thereof which are relevant to the controversy.24 The general rule
is that if the terms of an agreement are clear and leave no doubt as to the intention of the contracting
parties, the literal meaning of its stipulations shall prevail.25 It is further required that the various
stipulations of a contract shall be interpreted together, attributing to the doubtful ones that sense which
may result from all of them taken jointly.26

In this case, the phrase "for the last six months only" should be taken in the context of the entire
agreement. We agree with and adopt the CA’s interpretation of the phrase in this wise:

Their agreement speaks of two (2) periods of six months each. The first six-month period was given to
plaintiff-appellee (respondent) to make up her mind whether or not to purchase defendant-appellant’s
(petitioner's) property. The second six-month period was given to defendant-appellant to pay the P2
million loan in the event that plaintiff-appellee decided not to buy the subject property in which case
interest will be charged "for the last six months only", referring to the second six-month period. This
means that no interest will be charged for the first six-month period while appellee was making up her
mind whether to buy the property, but only for the second period of six months after appellee had decided
not to buy the property. This is the meaning of the phrase "for the last six months only". Certainly, there
is nothing in their agreement that suggests that interest will be charged for six months only even if it takes
defendant-appellant an eternity to pay the loan.27

The agreement that the amount given shall bear compounded bank interest for the last six months
only, i.e., referring to the second six-month period, does not mean that interest will no longer be charged
after the second six-month period since such stipulation was made on the logical and reasonable
expectation that such amount would be paid within the date stipulated. Considering that petitioner failed
to pay the amount given which under the Memorandum of Agreement shall be considered as a loan, the
monetary interest for the last six months continued to accrue until actual payment of the loaned amount.

The payment of regular interest constitutes the price or cost of the use of money and thus, until the
principal sum due is returned to the creditor, regular interest continues to accrue since the debtor
continues to use such principal amount.28 It has been held that for a debtor to continue in possession of the
principal of the loan and to continue to use the same after maturity of the loan without payment of the
monetary interest, would constitute unjust enrichment on the part of the debtor at the expense of the
creditor.29
Petitioner and respondent stipulated that the loaned amount shall earn compounded bank interests, and per
the certification issued by Prudential Bank, the interest rate for loans in 1991 ranged from 25% to 32%
per annum. The CA reduced the interest rate to 25% instead of the 32% awarded by the trial court which
petitioner no longer assailed.1awphi1.nét

In Bautista v. Pilar Development Corp.,30 we upheld the validity of a 21% per annum interest on
a P142,326.43 loan. In Garcia v. Court of Appeals,31 we sustained the agreement of the parties to a 24%
per annum interest on an P8,649,250.00 loan. Thus, the interest rate of 25% per annum awarded by the
CA to a P2 million loan is fair and reasonable.

Petitioner next claims that moral damages were awarded on the erroneous finding that she used a
fraudulent scheme to deprive respondent of her security for the loan; that such finding is baseless since
petitioner was acquitted in the case for perjury and false testimony filed by respondent against her.

We are not persuaded.

Article 31 of the Civil Code provides that when the civil action is based on an obligation not arising from
the act or omission complained of as a felony, such civil action may proceed independently of the
criminal proceedings and regardless of the result of the latter.32

While petitioner was acquitted in the false testimony and perjury cases filed by respondent against her,
those actions are entirely distinct from the collection of sum of money with damages filed by respondent
against petitioner.

We agree with the findings of the trial court and the CA that petitioner’s act of trying to deprive
respondent of the security of her loan by executing an affidavit of loss of the title and instituting a petition
for the issuance of a new owner’s duplicate copy of TCT No. 168173 entitles respondent to moral
damages.1a\^/phi1.net Moral damages may be awarded in culpa contractual or breach of contract cases
when the defendant acted fraudulently or in bad faith. Bad faith does not simply connote bad judgment or
negligence; it imports a dishonest purpose or some moral obliquity and conscious doing of wrong. It
partakes of the nature of fraud.33

The Memorandum of Agreement provides that in the event that respondent opts not to buy the property,
the money given by respondent to petitioner shall be treated as a loan and the property shall be considered
as the security for the mortgage. It was testified to by respondent that after they executed the agreement
on December 7, 1990, petitioner gave her the owner’s copy of the title to the property, the Deed of Sale
between petitioner and IMRDC, the certificate of occupancy, and the certificate of the Secretary of the
IMRDC who signed the Deed of Sale.34 However, notwithstanding that all those documents were in
respondent’s possession, petitioner executed an affidavit of loss that the owner’s copy of the title and the
Deed of Sale were lost.

Although petitioner testified that her execution of the affidavit of loss was due to the fact that she was of
the belief that since she had demanded from Atty. Lozada the return of the title, she thought that the
brown envelope with markings which Atty. Lozada gave her on May 5, 1991 already contained the title
and the Deed of Sale as those documents were in the same brown envelope which she gave to Atty.
Lozada prior to the transaction with respondent.35 Such statement remained a bare statement. It was not
proven at all since Atty. Lozada had not taken the stand to corroborate her claim. In fact, even petitioner’s
own witness, Benilda Ynfante (Ynfante), was not able to establish petitioner's claim that the title was
returned by Atty. Lozada in view of Ynfante's testimony that after the brown envelope was given to
petitioner, the latter passed it on to her and she placed it in petitioner’s attaché case36 and did not bother to
look at the envelope.37

It is clear therefrom that petitioner’s execution of the affidavit of loss became the basis of the filing of the
petition with the RTC for the issuance of new owner’s duplicate copy of TCT No. 168173. Petitioner’s
actuation would have deprived respondent of the security for her loan were it not for respondent’s timely
filing of a petition for relief whereby the RTC set aside its previous order granting the issuance of new
title. Thus, the award of moral damages is in order.

The entitlement to moral damages having been established, the award of exemplary damages is
proper.38Exemplary damages may be imposed upon petitioner by way of example or correction for the
public good.39 The RTC awarded the amount of P100,000.00 as moral and exemplary damages. While the
award of moral and exemplary damages in an aggregate amount may not be the usual way of awarding
said damages,40 no error has been committed by CA. There is no question that respondent is entitled to
moral and exemplary damages.

Petitioner argues that the CA erred in awarding attorney’s fees because the trial court’s decision did not
explain the findings of facts and law to justify the award of attorney’s fees as the same was mentioned
only in the dispositive portion of the RTC decision.

We agree.

Article 220841 of the New Civil Code enumerates the instances where such may be awarded and, in all
cases, it must be reasonable, just and equitable if the same were to be granted.42 Attorney's fees as part of
damages are not meant to enrich the winning party at the expense of the losing litigant. They are not
awarded every time a party prevails in a suit because of the policy that no premium should be placed on
the right to litigate.43 The award of attorney's fees is the exception rather than the general rule. As such, it
is necessary for the trial court to make findings of facts and law that would bring the case within the
exception and justify the grant of such award. The matter of attorney's fees cannot be mentioned only in
the dispositive portion of the decision.44 They must be clearly explained and justified by the trial court in
the body of its decision. On appeal, the CA is precluded from supplementing the bases for awarding
attorney’s fees when the trial court failed to discuss in its Decision the reasons for awarding the same.
Consequently, the award of attorney's fees should be deleted.

WHEREFORE, in view of all the foregoing, the Decision dated June 18, 2002 and the Resolution dated
September 11, 2002 of the Court of Appeals in CA-G.R. CV No. 52839 are AFFIRMED with
MODIFICATION that the award of attorney’s fees is DELETED.

No pronouncement as to costs.

SO ORDERED.

FIRST DIVISION

VINCENT E. OMICTIN, G.R. No.148004


Petitioner,
Present:

PUNO, C.J., Chairperson,


- versus - SANDOVAL-GUTIERREZ,
CORONA,
AZCUNA, and
GARCIA, JJ.
HON. COURT OF APPEALS
(Special Twelfth Division) and
GEORGE I. LAGOS,
Respondents. Promulgated:
January 22, 2007

x ---------------------------------------------------------------------------------------- x

DECISION

AZCUNA, J.:

This is a petition for certiorari[1] with prayer for a writ of preliminary injunction seeking the nullification
of the decision rendered by the Court of Appeals (CA) on June 30, 2000, and its resolution, dated March
5, 2001 in CA-G.R. SP No. 55834 entitled George I. Lagos v. Hon. Reinato G. Quilala, Presiding Judge
of RTC, Br. 57, Makati, Hon. Elizabeth Tayo Chua, Asst. City Prosecutor, Makati City, and Vincent E.
Omictin.

In its assailed decision, the CA declared the existence of a prejudicial question and ordered the suspension
of the criminal proceedings initiated by petitioner Vincent E. Omictin on behalf of Saag Phils., Inc.
against private respondent George I. Lagos, in view of a pending case before the Securities and Exchange
Commission (SEC) filed by the latter against the former, Saag Pte. (S) Ltd., Nicholas Ng, Janifer Yeo and
Alex Y. Tan.

The facts are as follows:

Petitioner Vincent E. Omictin, Operations Manager Ad Interim of Saag Phils., Inc., filed a complaint for
two counts of estafa with the Office of the City Prosecutor of Makati against private respondent George I.
Lagos. He alleged that private respondent, despite repeated demands, refused to return the two company
vehicles entrusted to him when he was still the president of Saag Phils., Inc..

On February 26, 1999, public prosecutor Alex G. Bagaoisan recommended the indictment of private
respondent, and on the same day, respondent was charged with the crime of estafa under Article 315, par.
1(b) of the Revised Penal Code before the Regional Trial Court (RTC), Branch 57 of Makati City. The
case was docketed as Criminal Case No. 99-633, entitled People of the Philippines v. George I. Lagos.

On June 4, 1999, private respondent filed a motion to recuse praying that Presiding Judge Reinato G.
Quilala inhibit himself from hearing the case based on the following grounds:

a) In an order, dated May 28, 1999, the presiding judge summarily denied
respondents motion: 1) to defer issuance of the warrant of arrest; and 2) to order
reinvestigation.

b) Immediately before the issuance of the above-mentioned order, the


presiding judge and Atty. Alex Y. Tan, SAAG Philippines, Inc.s Ad Interim
President, were seen together.[2]

On June 24, 1999, private respondent filed a motion to suspend proceedings on the basis of a prejudicial
question because of a pending petition with the Securities and Exchange Commission (SEC) involving
the same parties.

It appears that on January 7, 1999, private respondent filed SEC Case No. 01-99-6185 for the declaration
of nullity of the respective appointments of Alex Y. Tan and petitioner as President Ad Interim and
Operations Manager Ad Interim of Saag Phils., Inc., declaration of dividends, recovery of share in the
profits, involuntary dissolution and the appointment of a receiver, recovery of damages and an application
for a temporary restraining order (TRO) and injunction against Saag (S) Pte. Ltd., Nicholas Ng, Janifer
Yeo, Tan and petitioner. [3]

In the action before the SEC, private respondent averred that Saag (S) Pte. Ltd. is a foreign corporation
organized and existing under the laws of Singapore, and is fully owned by Saag Corporation (Bhd).
On July 1, 1994, he was appointed as Area Sales Manager in the Philippines by Thiang Shiang Hiang,
Manager of Saag (S) Pte. Ltd. Pursuant to his appointment, respondent was authorized to organize a local
joint venture corporation to be known as Saag Philippines, Inc. for the wholesale trade and service of
industrial products for oil, gas and power industries in the Philippines.

On September 9, 1994, Saag Philippines, Inc. was incorporated with Saag (S) Pte. Ltd. as the majority
stockholder. Private respondent was appointed to the board of directors, along with Rommel I. Lagos,
Jose E. Geronimo, Gan Ching Lai and Thiang Shiang Hiang, and was elected president of the domestic
corporation.

Later, due to intra-corporate disputes, Gan and Thiang resigned and divested their shares in Saag
Corporation (Bhd), thereby resulting in a change in the controlling interest in Saag (S) Pte. Ltd.

Barely three months after, or on June 23, 1998, private respondent resigned his post as president of Saag
Phils., Inc. while still retaining his position as a director of the company.[4] According to private
respondent, the joint venture agreement (JVA) between him or Saag Phils., Inc. and Saag (S) Pte. Ltd.
provided that should the controlling interest in the latter company, or its parent company Saag Corp.
(Bhd), be acquired by any other person or entity without his prior consent, he has the option either to
require the other stockholders to purchase his shares or to terminate the JVA and dissolve Saag Phils., Inc.
altogether. Thus, pursuant to this provision, since private respondent did not give his consent as regards
the transfer of shares made by Gan and Thiang, he made several requests to Nicholas Ng, who replaced
Gan as director, and Janifer Yeo, Executive Director of Saag (S) Pte. Ltd., to call for a board meeting in
order to discuss the following: a) implementation of the board resolution declaring dividends; b)
acquisition of private respondents shares by Saag (S) Pte. Ltd.; c) dissolution of Saag Phils., Inc.; and d)
the termination of the JVA.

Ng and Yeo failed to appear, however, in the scheduled board meetings. Instead, on September 30,
1998 they issued a letter appointing Alex Y. Tan as President Ad Interim of Saag Phils., Inc. Tan, in turn,
appointed petitioner Omictin as the companys Operations Manager Ad Interim.
Citing as a reason the absence of a board resolution authorizing the continued operations of Saag Phils.,
Inc., private respondent retained his possession of the office equipment of the company in a fiduciary
capacity as director of the corporation pending its dissolution and/or the resolution of the intra-corporate
dispute. He likewise changed the locks of the offices of the company allegedly to prevent Tan and
petitioner from seizing company property.

Private respondent stressed that Tans appointment was invalid because it was in derogation of the
company by-laws requiring that the president must be chosen from among the directors, and elected by
the affirmative vote of a majority of all the members of the board of directors. [5] As Tans appointment did
not have the acquiescence of the board of directors, petitioners appointment by the former is likewise
allegedly invalid. Thus, neither has the power or the authority to represent or act for Saag Phils., Inc. in
any transaction or action before the SEC or any court of justice.

The trial court, in an order dated September 8, 1999, denied respondents motion to suspend proceedings
and motion to recuse.
His motion for reconsideration having been denied by the trial court in its order issued on October 29,
1999, respondent filed with the CA the petition for certiorari[6] assailing the aforesaid orders.

On June 30, 2000, the CA rendered its challenged decision. The pertinent portion reads:

In a case for estafa, a valid demand made by an offended party is one of the essential
elements. It appears from the records that the delay of delivery of the motor vehicles by
petitioner to Saag Corporation is by reason of petitioners contention that the demand
made by Omictin and Atty. Tan to him to return the subject vehicles is not a valid
demand. As earlier mentioned, petitioner filed a case with the SEC questioning therein
private respondents appointment.

If the SEC should rule that the dissolution of Saag Phils. is proper, or that the
appointments of private respondents are invalid, the criminal case will eventually be
dismissed due to the absence of one of the essential elements of the crime of estafa.

Based on the foregoing, it is clear that a prejudicial question exists which calls for the
suspension of the criminal proceedings before the lower court.

WHEREFORE, in view of the foregoing, the assailed Order of September 8,


1999 and October 29, 1999, are hereby MODIFIED. The motion to suspend proceedings
is hereby GRANTED and respondent court is hereby enjoined from hearing Criminal
Case No. 99-633, entitled People of the Philippines v. George I. Lagos, until the
termination of the case with the Securities and Exchange Commission. The denial of the
motion to recuse is hereby AFFIRMED.
SO ORDERED.[7]

Incidentally, on January 18, 2001, the SEC case[8] was transferred to the Regional Trial Court (RTC)
of Mandaluyong City, Branch 214, pursuant to A.M. No. 00-11-03-SC[9]implementing the Securities and
Regulation Code (Republic Act No. 8799)[10] enacted on July 19, 2000, vesting in the RTCs jurisdiction
over intra-corporate disputes.[11]
Meanwhile, on March 5, 2001, the CA, addressing petitioners motion for reconsideration of the
aforementioned decision, issued its assailed resolution:

Considering that the petition for review on certiorari of the 30 June 2000 decision of this
Court, filed by the Office of the Solicitor General before the Supreme Court has already
TERMINATED on November 20, 2000 and a corresponding entry of judgment has
already been issued by the High Court, that the same is final and executory, the private
respondents motion for reconsideration of the decision 30 June 2000 before this Court is
NOTED for being moot and academic.

SO ORDERED.[12]

Hence, this petition raises the following issues:


I
RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OF JURISDICTION -

A) WHEN IT DECREED THAT A PREJUDICIAL QUESTION EXISTS IN THE SEC


CASE FILED BY PRIVATE RESPONDENT AGAINST SAAG (S) PTE. LTD.,
A FOREIGN CORPORATION, ALTHOUGH THE PRIVATE
COMPLAINANT IN THE CRIMINAL CASE FOR ESTAFA (WHERE
PRIVATE RESPONDENT IS THE ACCUSED THEREIN) IS ACTUALLY
SAAG PHILIPPINES, INC. A DOMESTIC CORPORATION WITH A
SEPARATE JURIDICAL PERSONALITY OF ITS OWN AND WHICH IS
NOT EVEN A PARTY IN THE SEC CASE; AND,

B) WHEN IT ORDERED THE SUSPENSION OF THE PROCEEDINGS IN


CRIMINAL CASE NO. 99-633 AGAINST PRIVATE RESPONDENT.

II
THIS PETITION FOR CERTIORARI IS THE ONLY PLAIN, SPEEDY AND
ADEQUATE REMEDY IN THE PREMISES.

In support of the above, petitioner argues, as follows:

1. The action before the SEC and the criminal case before the trial court do not involve any
prejudicial question.[13] SEC Case No. 01-99-6185 mainly involves the dissolution of Saag (S) Pte. Ltd.,
the appointment of a receiver, the distribution of profits, and the authority of petitioner and Tan to
represent Saag Phils., Inc. The entity which is being sued is Saag (S) Pte. Ltd., a foreign corporation over
which the SEC has yet to acquire jurisdiction. Hence, any decision that may be rendered in the SEC case
will neither be determinative of the innocence or guilt of the accused nor bind Saag Phils., Inc. because
the same was not made a party to the action even if the former is its holding corporation;

2. Saag Phils., Inc. has a separate corporate existence and is to be treated as a separate
entity from its holding or parent company, Saag (S) Pte. Ltd. The mere fact that one or more corporations
are owned or controlled by the same or single stockholder is not a sufficient ground for disregarding
separate corporate personalities;

3. Private respondents petition with the SEC seeks affirmative relief against Saag (S)
Pte. Ltd. for the enforcement or application of the alleged terms of the joint venture agreement (JVA) that
he purportedly entered into with the foreign corporation while he was still its Area Sales Manager in
the Philippines. The foreign corporation is not licensed to do business in the Philippines, thus, a party to a
contract with a foreign corporation doing business in the Philippines without a license is not entitled to
relief from the latter; and

4. There is no pending civil or administrative case in SEC against Saag Phils., Inc. that
warrants the application of a prejudicial question and the consequent suspension of the criminal action it
has instituted against private respondent. If any, the action before the SEC was merely a ploy to delay the
resolution of the criminal case and eventually frustrate the outcome of the estafa case.

In sum, the main issue is whether or not a prejudicial question exists to warrant the suspension of the
criminal proceedings pending the resolution of the intra-corporate controversy that was originally filed
with the SEC.
A prejudicial question is defined as that which arises in a case, the resolution of which is a logical
antecedent of the issue involved therein and the cognizance of which pertains to another tribunal. [14] Here,
the case which was lodged originally before the SEC and which is now pending before the RTC of
Mandaluyong City by virtue of Republic Act No. 8799 involves facts that are intimately related to those
upon which the criminal prosecution is based.
Ultimately, the resolution of the issues raised in the intra-corporate dispute will determine the guilt or
innocence of private respondent in the crime of estafa filed against him by petitioner before the RTC of
Makati. As correctly stated by the CA, one of the elements of the crime of estafa with abuse of confidence
under Article 315, par. 1(b) of the Revised Penal Code is a demand made by the offended party to the
offender:

The elements of estafa with abuse of confidence under subdivision No. 1, par. (b)
of Art. 315 are as follows:

1. That money, goods, or other personal property be received by the offender in trust, or
on commission, or for administration, or under any other obligation involving the
duty to make delivery of, or to return the same;

2. That there be misrepresentation or conversion of such money or property by the


offender, or denial on his part of such receipt;

3. That such misappropriation or conversion or denial is to the prejudice of another; and


4. That there is a demand made by the offended party to the offender.[15]

Logically, under the circumstances, since the alleged offended party is Saag Phils., Inc., the validity of the
demand for the delivery of the subject vehicles rests upon the authority of the person making such a
demand on the companys behalf. Private respondent is challenging petitioners authority to act for Saag
Phils., Inc. in the corporate case pending before the RTC of Mandaluyong, Branch 214. Taken in this
light, if the supposed authority of petitioner is found to be defective, it is as if no demand was ever made,
hence, the prosecution for estafa cannot prosper. Moreover, the mere failure to return the thing received
for safekeeping or on commission, or for administration, or under any other obligation involving the duty
to deliver or to return the same or deliver the value thereof to the owner could only give rise to a civil
action and does not constitute the crime of estafa. This is because the crime is committed by
misappropriating or converting money or goods received by the offender under a lawful transaction. As
stated in the case ofUnited States v. Bleibel:[16]

The crime of estafa is not committed by the failure to return the things received for sale
on commission, or to deliver their value, but, as this class of crime is defined by law, by
misappropriating or converting the money or goods received on commission. Delay in the
fulfillment of a commission or in the delivery of the sum on such account received only
involves civil liability. So long as the money that a person is under obligation to deliver is
not demanded of him, and he fails to deliver it for having wrongfully disposed of it, there
is no estafa, whatever be the cause of the debt.

Likewise, by analogy, the doctrine of primary jurisdiction may be applied in this case. The issues raised
by petitioner particularly the status of Saag Phils., Inc. vis--vis Saag (S) Pte. Ltd., as well as the question
regarding the supposed authority of the latter to make a demand on behalf of the company, are proper
subjects for the determination of the tribunal hearing the intra-corporate case which in this case is the
RTC of Mandaluyong, Branch 214. These issues would have been referred to the expertise of the SEC in
accordance with the doctrine of primary jurisdiction had the case not been transferred to the RTC of
Mandaluyong.

Strictly speaking, the objective of the doctrine of primary jurisdiction is to guide a court in determining
whether it should refrain from exercising its jurisdiction until after an administrative agency has
determined some question or some aspect of some question arising in the proceeding before the
court.[17] The court cannot or will not determine a controversy involving a question which is within the
jurisdiction of the administrative tribunal prior to resolving the same, where the question demands the
exercise of sound administrative discretion requiring special knowledge, experience and services in
determining technical and intricate matters of fact.[18]

While the above doctrine refers specifically to an administrative tribunal, the Court believes that the
circumstances in the instant case do not proscribe the application of the doctrine, as the role of an
administrative tribunal such as the SEC in determining technical and intricate matters of special
competence has been taken on by specially designated RTCs by virtue of Republic Act No.
8799.[19] Hence, the RTC of Mandaluyong where the intra-corporate case is pending has the primary
jurisdiction to determine the issues under contention relating to the status of the domestic corporation,
Saag Phils., Inc., vis--vis Saag Pte. Ltd.; and the authority of petitioner to act on behalf of the domestic
corporation, the determination of which will have a direct bearing on the criminal case. The law
recognizes that, in place of the SEC, the regular courts now have the legal competence to decide intra-
corporate disputes.[20]

In view of the foregoing, the Court finds no substantial basis in petitioners contention that the CA
committed grave abuse of discretion amounting to lack or excess of jurisdiction. Absent a showing of a
despotic, whimsical and arbitrary exercise of power by the CA, the petition must fail.

WHEREFORE, the petition is DISMISSED. The decision and resolution of the Court of Appeals in
CA-G.R. SP No. 55834, dated June 30, 2000 and March 5, 2001, respectively, are AFFIRMED.

No costs.

SO ORDERED.

Republic of the Philippines


SUPREME COURT
Manila

THIRD DIVISION

G.R. No. L-48157 March 16, 1988

RICARDO QUIAMBAO, petitioner,


vs.
HON. ADRIANO OSORIO, ZENAIDA GAZA BUENSUCERO, JUSTINA GAZA BERNARDO,
and FELIPE GAZA, respondents-appellees, LAND AUTHORITY, intervenor-appellant.

FERNAN, J.:

This case was certified to Us by the Court of Appeals as one involving pure questions of law pursuant to
Section 3, Rule 50 of the Revised Rules of Court.

The antecedents are as follows:


In a complaint for forcible entry filed by herein private respondents Zenaida Gaza Buensucero, Justina
Gaza Bernardo and Felipe Gaza against herein petitioner Ricardo Quiambao before the then Municipal
Court of Malabon, Rizal, docketed therein as Civil Case No. 2526, it was alleged that private respondents
were the legitimate possessors of a 30,835 sq. m. lot known as Lot No. 4, Block 12, Bca 2039 of the
Longos Estate situated at Barrio Longos, Malabon Rizal, by virtue of the Agreement to Sell No. 3482
executed in their favor by the former Land Tenure Administration [which later became the Land
Authority, then the Department of Agrarian Reform]; that under cover of darkness, petitioner
surreptitiously and by force, intimidation, strategy and stealth, entered into a 400 sq. m. portion thereof,
placed bamboo posts "staka" over said portion and thereafter began the construction of a house thereon;
and that these acts of petitioner, which were unlawful per se, entitled private respondents to a writ of
preliminary injunction and to the ejectment of petitioner from the lot in question.

Petitioner filed a motion to dismiss the complaint, and upon denial thereof, filed his Answer to the
complaint, specifically denying the material allegations therein and averring that the Agreement upon
which private respondents base their prior possession over the questioned lot had already been cancelled
by the Land Authority in an Order signed by its Governor, Conrado Estrella. By way of affirmative
defense and as a ground for dismissing the case, petitioner alleged the pendency of L.A. Case No. 968, an
administrative case before the Office of the Land Authority between the same parties and involving the
same piece of land. In said administrative case, petitioner disputed private respondents' right of
possession over the property in question by reason of the latter's default in the installment payments for
the purchase of said lot. Petitioner asserted that his administrative case was determinative of private
respondents' right to eject petitioner from the lot in question; hence a prejudicial question which bars a
judicial action until after its termination.

After hearing, the municipal court denied the motion to dismiss contained in petitioner's affirmative
defenses. It ruled that inasmuch as the issue involved in the case was the recovery of physical possession,
the court had jurisdiction to try and hear the case.

Dissatisfied with this ruling, petitioner filed before the then Court of First Instance of Rizal, Branch XII,
Caloocan City in Civil Case No. C-1576 a petition for certiorari with injunction against public respondent
Judge Adriano Osorio of the Municipal Court of Malabon and private respondents, praying for the
issuance of a writ of preliminary injunction ordering respondent judge to suspend the hearing in the
ejectment case until after the resolution of said petition. As prayed for, the then CFI of Rizal issued a
restraining order enjoining further proceedings in the ejectment case.

In his answer, respondent municipal judge submitted himself to the sound discretion of the CFI in the
disposition of the petition for certiorari. Private respondents, on the other hand, filed a motion to dismiss
the petition, maintaining that the administrative case did not constitute a prejudicial question as it
involved the question of ownership, unlike the ejectment case which involved merely the question of
possession.

Meanwhile, the Land Authority filed an Urgent Motion for Leave to Intervene in Civil Case No. C-1576
alleging the pendency of an administrative case between the same parties on the same subject matter in
L.A. Case No. 968 and praying that the petition for certiorari be granted, the ejectment complaint be
dismissed and the Office of the Land Authority be allowed to decide the matter exclusively.

Finding the issue involved in the ejectment case to be one of prior possession, the CFI dismissed the
petition for certiorari and lifted the restraining order previously issued. Petitioner's motion for
reconsideration of the dismissal order, adopted in toto by Intervenor Land Authority was denied for lack
of merit. Hence, this appeal filed by petitioner Quiambao and intervenor Land Authority with the Court of
Appeals, and certified to Us as aforesaid.

The instant controversy boils down to the sole question of whether or not the administrative case between
the private parties involving the lot subject matter of the ejectment case constitutes a prejudicial question
which would operate as a bar to said ejectment case.

A prejudicial question is understood in law to be that which arises in a case the resolution of which is a
logical antecedent of the issue involved in said case and the cognizance of which pertains to another
tribunal. 1 The doctrine of prejudicial question comes into play generally in a situation where civil and
criminal actions are pending and the issues involved in both cases are similar or so closely related that an
issue must be pre-emptively resolved in the civil case before the criminal action can proceed. Thus, the
existence of a prejudicial question in a civil case is alleged in the criminal case to cause the suspension of
the latter pending final determination of the former.

The essential elements of a prejudicial question as provided under Section 5, Rule 111 of the Revised
Rules of Court are: [a] the civil action involves an issue similar or intimately related to the issue in the
criminal action; and [b] the resolution of such issue determines whether or not the criminal action may
proceed.

The actions involved in the case at bar being respectively civil and administrative in character, it is
obvious that technically, there is no prejudicial question to speak of. Equally apparent, however, is the
intimate correlation between said two [2] proceedings, stemming from the fact that the right of private
respondents to eject petitioner from the disputed portion depends primarily on the resolution of the
pending administrative case. For while it may be true that private respondents had prior possession of the
lot in question, at the time of the institution of the ejectment case, such right of possession had been
terminated, or at the very least, suspended by the cancellation by the Land Authority of the Agreement to
Sell executed in their favor. Whether or not private respondents can continue to exercise their right of
possession is but a necessary, logical consequence of the issue involved in the pending administrative
case assailing the validity of the cancellation of the Agreement to Sell and the subsequent award of the
disputed portion to petitioner. If the cancellation of the Agreement to Sell and the subsequent award to
petitioner are voided, then private respondents would have every right to eject petitioner from the
disputed area. Otherwise, private respondent's light of possession is lost and so would their right to eject
petitioner from said portion.

Faced with these distinct possibilities, the more prudent course for the trial court to have taken is to hold
the ejectment proceedings in abeyance until after a determination of the administrative case. Indeed, logic
and pragmatism, if not jurisprudence, dictate such move. To allow the parties to undergo trial
notwithstanding the possibility of petitioner's right of possession being upheld in the pending
administrative case is to needlessly require not only the parties but the court as well to expend time, effort
and money in what may turn out to be a sheer exercise in futility. Thus, 1 Am Jur 2d tells us:

The court in which an action is pending may, in the exercise of a sound discretion, upon
proper application for a stay of that action, hold the action in abeyance to abide the
outcome of another pending in another court, especially where the parties and the issues
are the same, for there is power inherent in every court to control the disposition of
causes on its dockets with economy of time and effort for itself, for counsel, and for
litigants. Where the rights parties to the second action cannot be properly determined
until the questions raised in the first action are settled the second action should be
stayed. 2

While this rule is properly applicable to instances involving two [2] court actions, the existence in the
instant case of the same considerations of Identity of parties and issues, economy of time and effort for
the court, the counsels and the parties as well as the need to resolve the parties' right of possession before
the ejectment case may be properly determined, justifies the rule's analogous application to the case at
bar.

Fortich-Celdran, et al. vs. Celdran, et al., 19 SCRA 502, provides another analogous situation. In
sustaining the assailed order of the then Court of First Instance of Misamis Oriental ordering the
suspension of the criminal case for falsification of public document against several persons, among them
the subscribing officer Santiago Catane until the civil case involving the issue of the genuineness of the
alleged forged document shall have been decided, this Court cited as a reason therefor its own action on
the administrative charges against said Santiago Catane, as follows:

It should be mentioned here also that an administrative case filed in this Court against
Santiago Catane upon the same charge was held by Us in abeyance, thus:

"As it appears that the genuineness of the document allegedly forged by


respondent attorneys in Administrative Case No. 77 [Richard Ignacio
Celdran vs. Santiago Catane, etc., et al.] is necessarily involved in Civil
Case No. R-3397 of the Cebu Court of First Instance, action on the
herein complaint is withheld until that litigation has finally been decided.
Complainant Celdran shall inform the Court about such decision." 3
If a pending civil case may be considered to be in the nature of a prejudicial question to an administrative
case, We see no reason why the reverse may not be so considered in the proper case, such as in the
petition at bar. Finally, events occuring during the pendency of this petition attest to the wisdom of the
conclusion herein reached. For in the Manifestation filed by counsel for petitioner, it was stated that the
intervenor Land Authority which later became the Department of Agrarian Reform had promulgated a
decision in the administrative case, L.A. Case No. 968 affiriming the cancellation of Agreement to Sell
No. 3482 issued in favor of private respondents. With this development, the folly of allowing the
ejectment case to proceed is too evident to need further elaboration.

WHEREFORE, the instant petition is hereby GRANTED. Civil Case No. 2526 of the then Municipal
Court of Malabon, Rizal is hereby ordered DISMISSED. No Costs.

SO ORDERED.

FIRST DIVISION

[G.R. No. 138509. July 31, 2000]

IMELDA MARBELLA-BOBIS, petitioner, vs. ISAGANI D. BOBIS, respondent.

DECISION

YNARES-SANTIAGO, J.:

On October 21, 1985, respondent contracted a first marriage with one Maria Dulce B. Javier. Without said
marriage having been annulled, nullified or terminated, the same respondent contracted a second marriage
with petitioner Imelda Marbella-Bobis on January 25, 1996 and allegedly a third marriage with a certain
Julia Sally Hernandez. Based on petitioners complaint-affidavit, an information for bigamy was filed
against respondent on February 25, 1998, which was docketed as Criminal Case No. Q98-75611 of the
Regional Trial Court, Branch 226, Quezon City. Sometime thereafter, respondent initiated a civil action
for the judicial declaration of absolute nullity of his first marriage on the ground that it was celebrated
without a marriage license. Respondent then filed a motion to suspend the proceedings in the criminal
case for bigamy invoking the pending civil case for nullity of the first marriage as a prejudicial question
to the criminal case. The trial judge granted the motion to suspend the criminal case in an Order dated
December 29, 1998.[1] Petitioner filed a motion for reconsideration, but the same was denied.

Hence, this petition for review on certiorari. Petitioner argues that respondent should have first obtained a
judicial declaration of nullity of his first marriage before entering into the second marriage, inasmuch as
the alleged prejudicial question justifying suspension of the bigamy case is no longer a legal truism
pursuant to Article 40 of the Family Code.[2]

The issue to be resolved in this petition is whether the subsequent filing of a civil action for declaration of
nullity of a previous marriage constitutes a prejudicial question to a criminal case for bigamy.

A prejudicial question is one which arises in a case the resolution of which is a logical antecedent of the
issue involved therein.[3] It is a question based on a fact distinct and separate from the crime but so
intimately connected with it that it determines the guilt or innocence of the accused.[4] It must appear not
only that the civil case involves facts upon which the criminal action is based, but also that the resolution
of the issues raised in the civil action would necessarily be determinative of the criminal
case.[5] Consequently, the defense must involve an issue similar or intimately related to the same issue
raised in the criminal action and its resolution determinative of whether or not the latter action may
proceed.[6] Its two essential elements are:[7]

(a) the civil action involves an issue similar or intimately related to the issue raised in the
criminal action; and

(b) the resolution of such issue determines whether or not the criminal action may
proceed.

A prejudicial question does not conclusively resolve the guilt or innocence of the accused but simply tests
the sufficiency of the allegations in the information in order to sustain the further prosecution of the
criminal case. A party who raises a prejudicial question is deemed to have hypothetically admitted that all
the essential elements of a crime have been adequately alleged in the information, considering that the
prosecution has not yet presented a single evidence on the indictment or may not yet have rested its case.
A challenge of the allegations in the information on the ground of prejudicial question is in effect a
question on the merits of the criminal charge through a non-criminal suit.

Article 40 of the Family Code, which was effective at the time of celebration of the second marriage,
requires a prior judicial declaration of nullity of a previous marriage before a party may remarry. The
clear implication of this is that it is not for the parties, particularly the accused, to determine the validity
or invalidity of the marriage.[8] Whether or not the first marriage was void for lack of a license is a matter
of defense because there is still no judicial declaration of its nullity at the time the second marriage was
contracted. It should be remembered that bigamy can successfully be prosecuted provided all its elements
concur two of which are a previous marriage and a subsequent marriage which would have been valid had
it not been for the existence at the material time of the first marriage.[9]

In the case at bar, respondents clear intent is to obtain a judicial declaration of nullity of his first marriage
and thereafter to invoke that very same judgment to prevent his prosecution for bigamy. He cannot have
his cake and eat it too. Otherwise, all that an adventurous bigamist has to do is to disregard Article 40 of
the Family Code, contract a subsequent marriage and escape a bigamy charge by simply claiming that the
first marriage is void and that the subsequent marriage is equally void for lack of a prior judicial
declaration of nullity of the first. A party may even enter into a marriage aware of the absence of a
requisite - usually the marriage license - and thereafter contract a subsequent marriage without obtaining a
declaration of nullity of the first on the assumption that the first marriage is void. Such scenario would
render nugatory the provisions on bigamy. As succinctly held in Landicho v. Relova:[10]

(P)arties to a marriage should not be permitted to judge for themselves its nullity, only
competent courts having such authority. Prior to such declaration of nullity, the validity
of the first marriage is beyond question. A party who contracts a second marriage then
assumes the risk of being prosecuted for bigamy.

Respondent alleges that the first marriage in the case before us was void for lack of a marriage license.
Petitioner, on the other hand, argues that her marriage to respondent was exempt from the requirement of
a marriage license. More specifically, petitioner claims that prior to their marriage, they had already
attained the age of majority and had been living together as husband and wife for at least five
years.[11] The issue in this case is limited to the existence of a prejudicial question, and we are not called
upon to resolve the validity of the first marriage. Be that as it may, suffice it to state that the Civil Code,
under which the first marriage was celebrated, provides that "every intendment of law or fact leans toward
the validity of marriage, the indissolubility of the marriage bonds."[12] Hence, parties should not be
permitted to judge for themselves the nullity of their marriage, for the same must be submitted to the
determination of competent courts. Only when the nullity of the marriage is so declared can it be held as
void, and so long as there is no such declaration the presumption is that the marriage exists.[13] No matter
how obvious, manifest or patent the absence of an element is, the intervention of the courts must always
be resorted to. That is why Article 40 of the Family Code requires a "final judgment," which only the
courts can render. Thus, as ruled in Landicho v. Relova,[14] he who contracts a second marriage before the
judicial declaration of nullity of the first marriage assumes the risk of being prosecuted for bigamy, and in
such a case the criminal case may not be suspended on the ground of the pendency of a civil case for
declaration of nullity. In a recent case for concubinage, we held that the pendency of a civil case for
declaration of nullity of marriage is not a prejudicial question.[15] This ruling applies here by analogy
since both crimes presuppose the subsistence of a marriage.

Ignorance of the existence of Article 40 of the Family Code cannot even be successfully invoked as an
excuse.[16] The contracting of a marriage knowing that the requirements of the law have not been
complied with or that the marriage is in disregard of a legal impediment is an act penalized by the
Revised Penal Code.[17] The legality of a marriage is a matter of law and every person is presumed to
know the law. As respondent did not obtain the judicial declaration of nullity when he entered into the
second marriage, why should he be allowed to belatedly obtain that judicial declaration in order to delay
his criminal prosecution and subsequently defeat it by his own disobedience of the law? If he wants to
raise the nullity of the previous marriage, he can do it as a matter of defense when he presents his
evidence during the trial proper in the criminal case.
The burden of proof to show the dissolution of the first marriage before the second marriage was
contracted rests upon the defense,[18] but that is a matter that can be raised in the trial of the bigamy case.
In the meantime, it should be stressed that not every defense raised in the civil action may be used as a
prejudicial question to obtain the suspension of the criminal action. The lower court, therefore, erred in
suspending the criminal case for bigamy. Moreover, when respondent was indicted for bigamy, the fact
that he entered into two marriage ceremonies appeared indubitable. It was only after he was sued by
petitioner for bigamy that he thought of seeking a judicial declaration of nullity of his first marriage. The
obvious intent, therefore, is that respondent merely resorted to the civil action as a potential prejudicial
question for the purpose of frustrating or delaying his criminal prosecution. As has been discussed above,
this cannot be done.

In the light of Article 40 of the Family Code, respondent, without first having obtained the judicial
declaration of nullity of the first marriage, can not be said to have validly entered into the second
marriage. Per current jurisprudence, a marriage though void still needs a judicial declaration of such fact
before any party can marry again; otherwise the second marriage will also be void.[19] The reason is that,
without a judicial declaration of its nullity, the first marriage is presumed to be subsisting. In the case at
bar, respondent was for all legal intents and purposes regarded as a married man at the time he contracted
his second marriage with petitioner.[20] Against this legal backdrop, any decision in the civil action for
nullity would not erase the fact that respondent entered into a second marriage during the subsistence of a
first marriage. Thus, a decision in the civil case is not essential to the determination of the criminal
charge. It is, therefore, not a prejudicial question. As stated above, respondent cannot be permitted to use
his own malfeasance to defeat the criminal action against him.[21]

WHEREFORE, the petition is GRANTED. The order dated December 29, 1998 of the Regional Trial
Court, Branch 226 of Quezon City is REVERSED and SET ASIDE and the trial court is ordered to
IMMEDIATELY proceed with Criminal Case No. Q98-75611.

SO ORDERED.

FIRST DIVISION

[G.R. No. 133978. November 12, 2002]

JOSE S. CANCIO, JR., represented by ROBERTO L. CANCIO, petitioner, vs. EMERENCIANA


ISIP, respondent.

DECISION
YNARES-SANTIAGO, J.:

The instant petition for review under Rule 45 of the Rules of Court raises pure questions of law
involving the March 20, 1998[1] and June 1, 1998[2] Orders[3] rendered by the Regional Trial Court of
Pampanga, Branch 49, in Civil Case No. G-3272.
The undisputed facts are as follows:
Petitioner, assisted by a private prosecutor, filed three cases of Violation of B.P. No. 22 and three
cases of Estafa, against respondent for allegedly issuing the following checks without sufficient funds, to
wit: 1) Interbank Check No. 25001151 in the amount of P80,000.00; 2) Interbank Check No. 25001152 in
the amount of P 80,000.00; and 3) Interbank Check No. 25001157 in the amount of P30,000.00.[4]
The Office of the Provincial Prosecutor dismissed Criminal Case No. 13356, for Violation of B.P.
No. 22 covering check no. 25001151 on the ground that the check was deposited with the drawee bank
after 90 days from the date of the check. The two other cases for Violation of B.P. No. 22 (Criminal Case
No. 13359 and 13360) were filed with and subsequently dismissed by the Municipal Trial Court of
Guagua, Pampanga, Branch 1, on the ground of failure to prosecute.[5]
Meanwhile, the three cases for Estafa were filed with the Regional Trial Court of Pampanga, Branch
49, and docketed as Criminal Case Nos. G-3611 to G-3613. On October 21, 1997, after failing to present
its second witness, the prosecution moved to dismiss the estafa cases against respondent. The prosecution
likewise reserved its right to file a separate civil action arising from the said criminal cases. On the same
date, the trial court granted the motions of the prosecution. Thus-
Upon motion of the prosecution for the dismissal of these cases without prejudice to the refiling of the
civil aspect thereof and there being no comment from the defense, let these cases be dismissed without
prejudice to the refiling of the civil aspect of the cases.
SO ORDER[ED].[6]
On December 15, 1997, petitioner filed the instant case for collection of sum of money, seeking to
recover the amount of the checks subject of the estafa cases. On February 18, 1998, respondent filed a
motion to dismiss the complaint contending that petitioners action is barred by the doctrine of res
judicata. Respondent further prayed that petitioner should be held in contempt of court for forum-
shopping.[7]
On March 20, 1998, the trial court found in favor of respondent and dismissed the complaint. The
court held that the dismissal of the criminal cases against respondent on the ground of lack of interest or
failure to prosecute is an adjudication on the merits which amounted to res judicata on the civil case for
collection. It further held that the filing of said civil case amounted to forum-shopping.
On June 1, 1998, the trial court denied petitioners motion for reconsideration.[8] Hence, the instant
petition.
The legal issues for resolution in the case at bar are: 1) whether the dismissal of the estafa cases
against respondent bars the institution of a civil action for collection of the value of the checks subject of
the estafa cases; and 2) whether the filing of said civil action violated the anti-forum-shopping rule.
An act or omission causing damage to another may give rise to two separate civil liabilities on the
part of the offender, i.e., (1) civil liability ex delicto, under Article 100 of the Revised Penal Code;[9] and
(2) independent civil liabilities, such as those (a) not arising from an act or omission complained of as
felony [e.g. culpa contractual or obligations arising from law under Article 31[10] of the Civil
Code,[11] intentional torts under Articles 32[12] and 34,[13] and culpa aquiliana under Article 2176[14] of the
Civil Code]; or (b) where the injured party is granted a right to file an action independent and distinct
from the criminal action [Article 33,[15] Civil Code].[16] Either of these two possible liabilities may be
enforced against the offender subject, however, to the caveat under Article 2177 of the Civil Code that the
offended party cannot recover damages twice for the same act or omission or under both causes.[17]
The modes of enforcement of the foregoing civil liabilities are provided for in the Revised Rules of
Criminal Procedure. Though the assailed order of the trial court was issued on March 20, 1998, the said
Rules, which took effect on December 1, 2000, must be given retroactive effect in the instant case
considering that statutes regulating the procedure of the court are construed as applicable to actions
pending and undetermined at the time of their passage.[18]
Section 1, Rule 111, of the Revised Rules of Criminal Procedure provides:
SECTION 1. Institution of criminal and civil actions. (a) When a criminal action is instituted, the civil
action for the recovery of civil liability arising from the offense charged shall be deemed instituted with
the criminal action unless the offended party waives the civil action, reserves the right to institute it
separately or institutes the civil action prior to the criminal action.
The reservation of the right to institute separately the civil action shall be made before the prosecution
starts presenting its evidence and under circumstances affording the offended party a reasonable
opportunity to make such reservation.
xxxxxxxxx
Where the civil action has been filed separately and trial thereof has not yet commenced, it may be
consolidated with the criminal action upon application with the court trying the latter case. If the
application is granted, the trial of both actions shall proceed in accordance with section 2 of this Rule
governing consolidation of the civil and criminal actions.
Under the 1985 Rules on Criminal Procedure, as amended in 1988 and under the present Rules, the
civil liability ex-delicto is deemed instituted with the criminal action, but the offended party is given the
option to file a separate civil action before the prosecution starts to present evidence.[19]
Anent the independent civil actions under Articles 31, 32, 33, 34 and 2176 of the Civil Code, the old
rules considered them impliedly instituted with the civil liability ex-delicto in the criminal action, unless
the offended party waives the civil action, reserves his right to institute it separately, or institutes the civil
action prior to the criminal action. Under the present Rules, however, the independent civil actions may
be filed separately and prosecuted independently even without any reservation in the criminal action. The
failure to make a reservation in the criminal action is not a waiver of the right to file a separate and
independent civil action based on these articles of the Civil Code.[20]
In the case at bar, a reading of the complaint filed by petitioner show that his cause of action is based
on culpa contractual, an independent civil action. Pertinent portion of the complaint reads:
xxxxxxxxx
2. That plaintiff is the owner/proprietor to CANCIOS MONEY EXCHANGE with office
address at Guagua, Pampanga;
3. That on several occasions, particularly on February 27, 1993 to April 17 1993, inclusive,
defendant drew, issued and made in favor of the plaintiff the following checks:
CHECK NO. DATE AMOUNT
1. INTERBANK CHECK NO. 25001151 March 10, 1993 P80,000.00
2. INTERBANK CHECK NO. 25001152 March 27, 1993 P80,000.00
3. INTERBANK CHECK NO. 25001157 May 17, 1993 P30,000.00
in exchange of cash with the assurance that the said checks will be honored for payment on their
maturity dates, copy of the aforementioned checks are hereto attached and marked.
4. That when the said checks were presented to the drawee bank for encashment, the same were
all dishonored for reason of DRAWN AGAINST INSUFFICIENT FUNDS (DAIF);
5. That several demands were made upon the defendant to make good the checks but she failed
and refused and still fails and refuses without justifiable reason to pay plaintiff;
6. That for failure of the defendant without any justifiable reason to pay plaintiff the value of the
checks, the latter was forced to hire the services of undersigned counsel and agreed to pay the
amount of P30,000.00 as attorneys fees and P1,000.00 per appearance in court;
7. That for failure of the defendant without any justifiable reason to pay plaintiff and forcing the
plaintiff to litigate, the latter will incur litigation expenses in the amount of P20,000.00.
IN VIEW OF THE FOREGOING, it is prayed of this Court that after due notice and hearing a
judgment be rendered ordering defendant to pay plaintiff as follows:
a. the principal sum of P190,000.00 plus the legal interest;
b. attorneys fees of P30,000.00 plus P1,000.00 per court appearance;
c. litigation expenses in the amount of P20,000.00
PLAINTIFF prays for other reliefs just and equitable under the premises.
x x x x x x x x x.[21]
Evidently, petitioner sought to enforce respondents obligation to make good the value of the checks
in exchange for the cash he delivered to respondent. In other words, petitioners cause of action is the
respondents breach of the contractual obligation. It matters not that petitioner claims his cause of action to
be one based on delict.[22] The nature of a cause of action is determined by the facts alleged in the
complaint as constituting the cause of action. The purpose of an action or suit and the law to govern it is
to be determined not by the claim of the party filing the action, made in his argument or brief, but rather
by the complaint itself, its allegations and prayer for relief.[23]
Neither does it matter that the civil action reserved in the October 21, 1997 order of the trial court
was the civil action ex delicto. To reiterate, an independent civil action arising from contracts, as in the
instant case, may be filed separately and prosecuted independently even without any reservation in the
criminal action. Under Article 31 of the Civil Code [w]hen the civil action is based on an obligation not
arising from the act or omission complained of as a felony, [e.g. culpa contractual] such civil action may
proceed independently of the criminal proceedings and regardless of the result of the latter. Thus,
in Vitola, et al. v. Insular Bank of Asia and America,[24] the Court, applying Article 31 of the Civil Code,
held that a civil case seeking to recover the value of the goods subject of a Letter of Credit-Trust Receipt
is a civil action ex contractu and not ex delicto. As such, it is distinct and independent from the estafa case
filed against the offender and may proceed regardless of the result of the criminal proceedings.
One of the elements of res judicata is identity of causes of action.[25] In the instant case, it must be
stressed that the action filed by petitioner is an independent civil action, which remains separate and
distinct from any criminal prosecution based on the same act.[26] Not being deemed instituted in the
criminal action based on culpa criminal, a ruling on the culpability of the offender will have no bearing
on said independent civil action based on an entirely different cause of action, i.e., culpa contractual.
In the same vein, the filing of the collection case after the dismissal of the estafa cases against
respondent did not amount to forum-shopping. The essence of forum-shopping is the filing of multiple
suits involving the same parties for the same cause of action, either simultaneously or successively, to
secure a favorable judgment. Although the cases filed by petitioner arose from the same act or omission
of respondent, they are, however, based on different causes of action. The criminal cases for estafa are
based on culpa criminal while the civil action for collection is anchored on culpa contractual. Moreover,
there can be no forum-shopping in the instant case because the law expressly allows the filing of a
separate civil action which can proceed independently of the criminal action.[27]
Clearly, therefore, the trial court erred in dismissing petitioners complaint for collection of the value
of the checks issued by respondent. Being an independent civil action which is separate and distinct from
any criminal prosecution and which require no prior reservation for its institution, the doctrine of res
judicata and forum-shopping will not operate to bar the same.
WHEREFORE, in view of all the foregoing, the instant petition is GRANTED. The March 20, 1998
and June 1, 1998 Orders of the Regional Trial Court of Pampanga, Branch 49, in Civil Case No. G-3272
are REVERSED and SET ASIDE. The instant case is REMANDED to the trial court for further
proceedings.
SO ORDERED

Republic of the Philippines


Supreme Court
Manila

THIRD DIVISION

JUAN DE DIOS CARLOS, G.R. No. 179922


Petitioner,
Present:

- versus - YNARES-SANTIAGO, J.,


Chairperson,
AUSTRIA-MARTINEZ,
FELICIDAD SANDOVAL, also CHICO-NAZARIO,
known as FELICIDAD S. VDA. NACHURA, and
DE CARLOS or FELICIDAD REYES, JJ.
SANDOVAL CARLOS or
FELICIDAD SANDOVAL VDA.
DE CARLOS, and TEOFILO Promulgated:
CARLOS II,
Respondents. December 16, 2008

x--------------------------------------------------x

DECISION

REYES, R.T., J.:

ONLY a spouse can initiate an action to sever the marital bond for marriages solemnized during
the effectivity of the Family Code, except cases commenced prior to March 15, 2003. The nullity and
annulment of a marriage cannot be declared in a judgment on the pleadings, summary judgment, or
confession of judgment.
We pronounce these principles as We review on certiorari the Decision[1] of the Court of Appeals
(CA) which reversed and set aside the summary judgment[2] of the Regional Trial Court (RTC) in an
action for declaration of nullity of marriage, status of a child, recovery of property, reconveyance, sum of
money, and damages.

The Facts

The events that led to the institution of the instant suit are unveiled as follows:

Spouses Felix B. Carlos and Felipa Elemia died intestate. They left six parcels of land to their
compulsory heirs, Teofilo Carlos and petitioner Juan De Dios Carlos. The lots are particularly described
as follows:

Parcel No. 1

Lot No. 162 of the MUNTINLUPA ESTATE SUBDIVISION, Case No. 6137 of the
Court of Land Registration.

Exemption from the provisions of Article 567 of the Civil Code is specifically reserved.

Area: 1 hectare, 06 ares, 07 centares.

Parcel No. 2

A parcel of land (Lot No. 159-B), being a portion of Lot 159, situated in the Bo. of
Alabang, Municipality of Muntinlupa, Province of Rizal, x x x containing an area of
Thirteen Thousand Four Hundred Forty One (13,441) square meters.

Parcel No. 3

A parcel of land (Lot 159-B-2 of the subd. plan [LRC] Psd-325903, approved as a non-
subd. project), being a portion of Lot 159-B [LRC] Psd- Alabang, Mun. of Muntinlupa,
Metro Manila,Island of Luzon. Bounded on the NE, points 2 to 4 by Lot 155, Muntinlupa
Estate; on the SE, point 4 to 5 by Lot 159-B-5; on the S, points 5 to 1 by Lot 159-B-3; on
the W, points 1 to 2 by Lot 159-B-1 (Road widening) all of the subd. plan, containing an
area of ONE HUNDRED THIRTY (130) SQ. METERS, more or less.

PARCEL No. 4

A parcel of land (Lot 28-C of the subd. plan Psd-13-007090, being a portion of Lot 28,
Muntinlupa Estate, L.R.C. Rec. No. 6137), situated in the Bo. of Alabang, Mun. of
Muntinlupa, MetroManila. Bounded on the NE, along lines 1-2 by Lot 27, Muntinlupa
Estate; on the East & SE, along lines 2 to 6 by Mangangata River; and on the West.,
along line 6-1, by Lot 28-B of the subd. plan x x x containing an area
of ONE THUSAND AND SEVENTY-SIX (1,076) SQUARE METERS.

PARCEL No. 5

PARCELA DE TERRENO No. 50, Manzana No. 18, de la subd. de Solocan. Linda por el
NW, con la parcela 49; por el NE, con la parcela 36; por el SE, con la parcela 51; y por el
SW, con la calle Dos Castillas. Partiendo de un punto marcado 1 en el plano, el cual se
halla a S. gds. 01'W, 72.50 mts. Desde el punto 1 de esta manzana, que es un mojon de
concreto de la Ciudad de Manila, situado on el esquina E. que forman las Calles Laong
Laan y Dos. Castillas, continiendo un extension superficial de CIENTO CINCUENTA
(150) METROS CUADRADOS.

PARCEL No. 6

PARCELA DE TERRENO No. 51, Manzana No. 18, de la subd. De Solocon. Linda por
el NW, con la parcela 50; por el NE, con la parcela 37; por el SE, con la parcela 52; por
el SW, con la Calle Dos Castillas. Partiendo de un punto Marcado 1 en el plano, el cual
se halla at S. 43 gds. 01'E, 82.50 mts. Desde el punto 1 de esta manzana, que es un mojon
de concreto de la Ciudad de Manila, situado on el esquina E. que forman las Calles Laong
Laan y Dos. Castillas, continiendo una extension superficial de CIENTO CINCUENTA
(150) METROS CUADRADOS.[3]

During the lifetime of Felix Carlos, he agreed to transfer his estate to Teofilo. The agreement was
made in order to avoid the payment of inheritance taxes. Teofilo, in turn, undertook to deliver and turn
over the share of the other legal heir, petitioner Juan De Dios Carlos.

Eventually, the first three (3) parcels of land were transferred and registered in the name of
Teofilo. These three (3) lots are now covered by Transfer Certificate of Title (TCT) No. 234824 issued by
the Registry of Deeds of Makati City; TCT No. 139061 issued by the Registry of Deeds of Makati City;
and TCT No. 139058 issued by the Registry of Deeds of Makati City.

Parcel No. 4 was registered in the name of petitioner. The lot is now covered by TCT No. 160401
issued by the Registry of Deeds of Makati City.

On May 13, 1992, Teofilo died intestate. He was survived by respondents Felicidad and their son,
Teofilo Carlos II (Teofilo II). Upon Teofilos death, Parcel Nos. 5 & 6 were registered in the name of
respondent Felicidad and co-respondent, Teofilo II. The said two (2) parcels of land are covered
by TCT Nos. 219877 and 210878, respectively, issued by the Registry of Deeds of Manila.

In 1994, petitioner instituted a suit against respondents before the RTC in Muntinlupa City,
docketed as Civil Case No. 94-1964. In the said case, the parties submitted and caused the approval of a
partial compromise agreement. Under the compromise, the parties acknowledged their respective shares
in the proceeds from the sale of a portion of the first parcel of land. This includes the remaining 6,691-
square-meter portion of said land.

On September 17, 1994, the parties executed a deed of extrajudicial partition, dividing
the remaining land of the first parcel between them.

Meanwhile, in a separate case entitled Rillo v. Carlos,[4] 2,331 square meters of the second parcel
of land were adjudicated in favor of plaintiffs Rillo. The remaining 10,000-square meter portion was later
divided between petitioner and respondents.

The division was incorporated in a supplemental compromise agreement executed on August 17,
1994, with respect to Civil Case No. 94-1964. The parties submitted the supplemental compromise
agreement, which was approved accordingly.
Petitioner and respondents entered into two more contracts in August 1994. Under the contracts,
the parties equally divided between them the third and fourth parcels of land.

In August 1995, petitioner commenced an action, docketed as Civil Case No. 95-135, against
respondents before the court a quo with the following causes of action: (a) declaration of nullity of
marriage; (b) status of a child; (c) recovery of property; (d) reconveyance; and (e) sum of money and
damages. The complaint was raffled to Branch 256 of the RTC in Muntinlupa.

In his complaint, petitioner asserted that the marriage between his late brother Teofilo and
respondent Felicidad was a nullity in view of the absence of the required marriage license. He likewise
maintained that his deceased brother was neither the natural nor the adoptive father of respondent Teofilo
Carlos II.

Petitioner likewise sought the avoidance of the contracts he entered into with respondent
Felicidad with respect to the subject real properties. He also prayed for the cancellation of the certificates
of title issued in the name of respondents. He argued that the properties covered by such certificates of
title, including the sums received by respondents as proceeds, should be reconveyed to him.

Finally, petitioner claimed indemnification as and by way of moral and exemplary damages,
attorneys fees, litigation expenses, and costs of suit.

On October 16, 1995, respondents submitted their answer. They denied the material averments of
petitioners complaint. Respondents contended that the dearth of details regarding the requisite marriage
license did not invalidate Felicidads marriage to Teofilo. Respondents declared that Teofilo II was the
illegitimate child of the deceased TeofiloCarlos with another woman.

On the grounds of lack of cause of action and lack of jurisdiction over the subject matter,
respondents prayed for the dismissal of the case before the trial court. They also asked that their
counterclaims for moral and exemplary damages, as well as attorneys fees, be granted.

But before the parties could even proceed to pre-trial, respondents moved for summary
judgment. Attached to the motion was the affidavit of the justice of the peace who solemnized the
marriage. Respondents also submitted the Certificate of Live Birth of respondent Teofilo II. In the
certificate, the late Teofilo Carlos and respondent Felicidad were designated as parents.

On January 5, 1996, petitioner opposed the motion for summary judgment on the ground of
irregularity of the contract evidencing the marriage. In the same breath, petitioner lodged his own motion
for summary judgment. Petitioner presented a certification from the Local Civil Registrar of Calumpit,
Bulacan, certifying that there is no record of birth of respondent Teofilo II.

Petitioner also incorporated in the counter-motion for summary judgment the testimony of
respondent Felicidad in another case. Said testimony was made in Civil Case No. 89-2384,
entitled Carlos v. Gorospe, before the RTC Branch 255, Las Pias. In her testimony, respondent Felicidad
narrated that co-respondent Teofilo II is her child with Teofilo.[5]
Subsequently, the Office of the City Prosecutor of Muntinlupa submitted to the trial court its
report and manifestation, discounting the possibility of collusion between the parties.
RTC and CA Dispositions

On April 8, 1996, the RTC rendered judgment, disposing as follows:

WHEREFORE, premises considered, defendants (respondents) Motion for


Summary Judgment is hereby denied. Plaintiffs (petitioners) Counter-Motion for
Summary Judgment is hereby granted and summary judgment is hereby rendered in favor
of plaintiff as follows:

1. Declaring the marriage between defendant Felicidad Sandoval and Teofilo


Carlos solemnized at Silang, Cavite on May 14, 1962, evidenced by the Marriage
Certificate submitted inthis case, null and void ab initio for lack of the requisite marriage
license;

2. Declaring that the defendant minor, Teofilo S. Carlos II, is not the natural,
illegitimate, or legally adopted child of the late Teofilo E. Carlos;
3. Ordering defendant Sandoval to pay and restitute to plaintiff the sum
of P18,924,800.00 together with the interest thereon at the legal rate from date of filing of
the instant complaint until fully paid;

4. Declaring plaintiff as the sole and exclusive owner of the parcel of land, less
the portion adjudicated to plaintiffs in Civil Case No. 11975, covered by TCT No.
139061 of the Register of Deeds of Makati City, and ordering said Register of Deeds to
cancel said title and to issue another title in the sole name of plaintiff herein;

5. Declaring the Contract, Annex K of complaint, between plaintiff and


defendant Sandoval null and void, and ordering the Register of Deeds of Makati City to
cancel TCT No. 139058 in the name of Teofilo Carlos, and to issue another title in the
sole name of plaintiff herein;

6. Declaring the Contract, Annex M of the complaint, between plaintiff and


defendant Sandoval null and void;

7. Ordering the cancellation of TCT No. 210877 in the names of defendant


Sandoval and defendant minor Teofilo S. Carlos II and ordering the Register of Deeds of
Manila to issue another title in the exclusive name of plaintiff herein;

8. Ordering the cancellation of TCT No. 210878 in the name of defendant


Sandoval and defendant Minor Teofilo S. Carlos II and ordering the Register of Deeds of
Manila to issue another title in the sole name of plaintiff herein.

Let this case be set for hearing for the reception of plaintiffs evidence on his
claim for moral damages, exemplary damages, attorneys fees, appearance fees, and
litigation expenses onJune 7, 1996 at 1:30 o'clock in the afternoon.

SO ORDERED.[6]

Dissatisfied, respondents appealed to the CA. In the appeal, respondents argued, inter alia, that
the trial court acted without or in excess of jurisdiction in rendering summary judgment annulling the
marriage of Teofilo, Sr. and Felicidad and in declaring Teofilo II as not an illegitimate child of Teofilo,
Sr.

On October 15, 2002, the CA reversed and set aside the RTC ruling, disposing as follows:
WHEREFORE, the summary judgment appealed from is REVERSED and SET
ASIDE and in lieu thereof, a new one is entered REMANDING the case to the court of
origin for further proceedings.

SO ORDERED.[7]

The CA opined:

We find the rendition of the herein appealed summary judgment by the court a
quo contrary to law and public policy as ensconced in the aforesaid safeguards. The fact
that it was appellants who first sought summary judgment from the trial court, did not
justify the grant thereof in favor of appellee. Not being an action to recover upon a claim
or to obtain a declaratory relief, the rule on summary judgment apply (sic) to an action to
annul a marriage. The mere fact that no genuine issue was presented and the desire to
expedite the disposition of the case cannot justify a misinterpretation of the rule. The first
paragraph of Article 88 and 101 of the Civil Code expressly prohibit the rendition of
decree of annulment of a marriage upon a stipulation of facts or a confession of
judgment. Yet, the affidavits annexed to the petition for summary judgment practically
amount to these methods explicitly proscribed by the law.

We are not unmindful of appellees argument that the foregoing safeguards have
traditionally been applied to prevent collusion of spouses in the matter of dissolution of
marriages and that the death of Teofilo Carlos on May 13, 1992 had effectively dissolved
the marriage herein impugned. The fact, however, that appellees own brother and
appellant Felicidad Sandoval lived together as husband and wife for thirty years and that
the annulment of their marriage is the very means by which the latter is sought to be
deprived of her participation in the estate left by the former call for a closer and more
thorough inquiry into the circumstances surrounding the case. Rather that the summary
nature by which the court a quo resolved the issues in the case, the rule is to the effect
that the material facts alleged in the complaint for annulment of marriage should always
be proved. Section 1, Rule 19 of the Revised Rules of Court provides:

Section 1. Judgment on the pleadings. Where an answer fails to


tender an issue, or otherwise admits the material allegations of the
adverse party's pleading, the court may, on motion of that party, direct
judgment on such pleading. But in actions for annulment of
marriage or for legal separation, the material facts alleged in the
complaint shall always be proved. (Underscoring supplied)

Moreover, even if We were to sustain the applicability of the rules on summary


judgment to the case at bench, Our perusal of the record shows that the finding of the
court a quo for appellee would still not be warranted. While it may be readily conceded
that a valid marriage license is among the formal requisites of marriage, the absence of
which renders the marriage voidab initio pursuant to Article 80(3) in relation to Article
58 of the Civil Code the failure to reflect the serial number of the marriage license on the
marriage contract evidencing the marriage between Teofilo Carlos and appellant
Felicidad Sandoval, although irregular, is not as fatal as appellee represents it to
be. Aside from the dearth of evidence to the contrary, appellant Felicidad Sandovals
affirmation of the existence of said marriage license is corroborated by the following
statement in the affidavit executed by Godofredo Fojas, then Justice of the Peace who
officiated the impugned marriage, to wit:

That as far as I could remember, there was a marriage license


issued at Silang, Cavite on May 14, 1962 as basis of the said marriage
contract executed by Teofilo Carlos and Felicidad Sandoval, but the
number of said marriage license was inadvertently not placed in the
marriage contract for the reason that it was the Office Clerk who filled
up the blanks in the Marriage Contract who in turn, may have overlooked
the same.
Rather than the inferences merely drawn by the trial court, We are of the
considered view that the veracity and credibility of the foregoing statement as well as the
motivations underlying the same should be properly threshed out in a trial of the case on
the merits.

If the non-presentation of the marriage contract the primary evidence of marriage


is not proof that a marriage did not take place, neither should appellants non-presentation
of the subject marriage license be taken as proof that the same was not procured. The
burden of proof to show the nullity of the marriage, it must be emphasized, rests upon the
plaintiff and any doubt should be resolved in favor of the validity of the marriage.

Considering that the burden of proof also rests on the party who disputes the
legitimacy of a particular party, the same may be said of the trial courts rejection of the
relationship between appellant Teofilo Carlos II and his putative father on the basis of the
inconsistencies in appellant Felicidad Sandovals statements. Although it had effectively
disavowed appellants prior claims regarding the legitimacy of appellant Teofilo Carlos II,
the averment in the answer that he is the illegitimate son of appellees brother, to Our
mind, did not altogether foreclose the possibility of the said appellants illegitimate
filiation, his right to prove the same or, for that matter, his entitlement to inheritance
rights as such.

Without trial on the merits having been conducted in the case, We find appellees
bare allegation that appellant Teofilo Carlos II was merely purchased from an indigent
couple by appellant Felicidad Sandoval, on the whole, insufficient to support what could
well be a minors total forfeiture of the rights arising from his
putative filiation. Inconsistent though it may be to her previous statements, appellant
Felicidad Sandovals declaration regarding the illegitimate filiation of Teofilo Carlos II is
more credible when considered in the light of the fact that, during the last eight years of
his life, Teofilo Carlos allowed said appellant the use of his name and the shelter of his
household. The least that the trial court could have done in the premises was to conduct a
trial on the merits in order to be able to thoroughly resolve the issues pertaining to the
filiation of appellant Teofilo Carlos II.[8]

On November 22, 2006, petitioner moved for reconsideration and for the inhibition of
the ponente, Justice Rebecca De Guia-Salvador. The CA denied the twin motions.

Issues

In this petition under Rule 45, petitioner hoists the following issues:

1. That, in reversing and setting aside the Summary Judgment under the
Decision, Annex A hereof, and in denying petitioners Motion for reconsideration under
the Resolution, Annex F hereof, with respect to the nullity of the impugned marriage,
petitioner respectfully submits that the Court of Appeals committed a grave
reversible error in applying Articles 88 and 101 of the Civil Code, despite the fact that the
circumstances of this case are different from that contemplated and intended by law, or
has otherwise decided a question of substance not theretofore decided by the Supreme
Court, or has decided it in a manner probably not in accord with law or with the
applicable decisions of this Honorable Court;

2. That in setting aside and reversing the Summary Judgment and, in lieu thereof,
entering another remanding the case to the court of origin for further proceedings,
petitioner most respectfully submits that the Court of Appeals committed a serious
reversible error in applying Section 1, Rule 19 (now Section 1, Rule 34) of the Rules of
Court providing for judgment on the pleadings, instead of Rule 35 governing Summary
Judgments;
3. That in reversing and setting aside the Summary Judgment and, in lieu thereof,
entering another remanding the case to the court of origin for further proceedings,
petitioner most respectfully submits that the Court of Appeals committed grave abuse of
discretion, disregarded judicial admissions, made findings on ground of speculations,
surmises, and conjectures, or otherwise committed misapplications of the laws and
misapprehension of the facts.[9] (Underscoring supplied)

Essentially, the Court is tasked to resolve whether a marriage may be declared void ab initio through a
judgment on the pleadings or a summary judgment and without the benefit of a trial. But there are other
procedural issues, including the capacity of one who is not a spouse in bringing the action for nullity of
marriage.

Our Ruling

I. The grounds for declaration of absolute nullity of marriage must be proved. Neither
judgment on the pleadings nor summary judgment is allowed. So is confession of judgment
disallowed.

Petitioner faults the CA in applying Section 1, Rule 19[10] of the Revised Rules of Court, which
provides:

SECTION 1. Judgment on the pleadings. Where an answer fails to tender an


issue, or otherwise admits the material allegations of the adverse partys pleading, the
court may, on motion of that party, direct judgment on such pleading. But in actions for
annulment of marriage or for legal separation, the material facts alleged in the complaint
shall always be proved.

He argues that the CA should have applied Rule 35 of the Rules of Court governing summary judgment,
instead of the rule on judgment on the pleadings.

Petitioner is misguided. The CA did not limit its finding solely within the provisions of the Rule on
judgment on the pleadings. In disagreeing with the trial court, the CA likewise considered the provisions
on summary judgments, to wit:

Moreover, even if We are to sustain the applicability of the rules on summary


judgment to the case at bench, Our perusal of the record shows that the finding of the
court a quo for appellee would still not be warranted. x x x[11]

But whether it is based on judgment on the pleadings or summary judgment, the CA was correct in
reversing the summary judgment rendered by the trial court. Both the rules on judgment on the pleadings
and summary judgments have no place in cases of declaration of absolute nullity of marriage and even in
annulment of marriage.

With the advent of A.M. No. 02-11-10-SC, known as Rule on Declaration of Absolute Nullity of Void
Marriages and Annulment of Voidable Marriages, the question on the application of summary judgments
or even judgment on the pleadings in cases of nullity or annulment of marriage has been stamped with
clarity. The significant principle laid down by the said Rule, which took effect on March 15, 2003[12] is
found in Section 17, viz.:

SEC. 17. Trial. (1) The presiding judge shall personally conduct the trial of the
case. No delegation of evidence to a commissioner shall be allowed except as to matters
involving property relations of the spouses.
(2) The grounds for declaration of absolute nullity or annulment of marriage must
be proved. No judgment on the pleadings, summary judgment, or confession of
judgment shall be allowed. (Underscoring supplied)

Likewise instructive is the Courts pronouncement in Republic v. Sandiganbayan.[13] In that case, We


excluded actions for nullity or annulment of marriage from the application of summary judgments.

Prescinding from the foregoing discussion, save for annulment of marriage or


declaration of its nullity or for legal separation, summary judgment is applicable to all
kinds of actions.[14](Underscoring supplied)

By issuing said summary judgment, the trial court has divested the State of its lawful right and
duty to intervene in the case. The participation of the State is not terminated by the declaration of the
public prosecutor that no collusion exists between the parties. The State should have been given the
opportunity to present controverting evidence before the judgment was rendered.[15]

Both the Civil Code and the Family Code ordain that the court should order the prosecuting attorney to
appear and intervene for the State. It is at this stage when the public prosecutor sees to it that there is no
suppression of evidence. Concomitantly, even if there is no suppression of evidence, the public prosecutor
has to make sure that the evidence to be presented or laid down before the court is not fabricated.

To further bolster its role towards the preservation of marriage, the Rule on Declaration of Absolute
Nullity of Void Marriages reiterates the duty of the public prosecutor, viz.:

SEC. 13. Effect of failure to appear at the pre-trial. (a) x x x

(b) x x x If there is no collusion, the court shall require the public prosecutor to intervene
for the State during the trial on the merits to prevent suppression or fabrication of
evidence.(Underscoring supplied)
Truly, only the active participation of the public prosecutor or the Solicitor General will ensure that the
interest of the State is represented and protected in proceedings for declaration of nullity of marriages by
preventing the fabrication or suppression of evidence.[16]

II. A petition for declaration of absolute nullity of void marriage may be filed solely by the
husband or wife. Exceptions: (1) Nullity of marriage cases commenced before the effectivity of A.M.
No. 02-11-10-SC; and (2) Marriages celebrated during the effectivity of the Civil Code.

Under the Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable
Marriages, the petition for declaration of absolute nullity of marriage may not be filed by any party
outside of the marriage. The Rule made it exclusively a right of the spouses by stating:

SEC. 2. Petition for declaration of absolute nullity of void marriages.

(a) Who may file. A petition for declaration of absolute nullity of void marriage
may be filed solely by the husband or the wife. (Underscoring supplied)

Section 2(a) of the Rule makes it the sole right of the husband or the wife to file a petition for
declaration of absolute nullity of void marriage. The rationale of the Rule is enlightening, viz.:

Only an aggrieved or injured spouse may file a petition for annulment of


voidable marriages or declaration of absolute nullity of void marriages. Such petition
cannot be filed by compulsory or intestate heirs of the spouses or by the State. The
Committee is of the belief that they do not have a legal right to file the
petition. Compulsory or intestate heirs have only inchoate rights prior to the death of their
predecessor, and, hence, can only question the validity of the marriage of the spouses
upon the death of a spouse in a proceeding for the settlement of the estate of the deceased
spouse filed in the regular courts. On the other hand, the concern of the State is to
preserve marriage and not to seek its dissolution.[17] (Underscoring supplied)

The new Rule recognizes that the husband and the wife are the sole architects of a healthy,
loving, peaceful marriage. They are the only ones who can decide when and how to build the foundations
of marriage. The spouses alone are the engineers of their marital life. They are simultaneously the
directors and actors of their matrimonial true-to-life play. Hence, they alone can and should decide when
to take a cut, but only in accordance with the grounds allowed by law.

The innovation incorporated in A.M. No. 02-11-10-SC sets forth a demarcation line between
marriages covered by the Family Code and those solemnized under the Civil Code. The Rule extends only
to marriages entered into during the effectivity of the Family Code which took effect on August 3,
1988.[18]

The advent of the Rule on Declaration of Absolute Nullity of Void Marriages marks
the beginning of the end of the right of the heirs of the deceased spouse to bring a nullity of marriage case
against the surviving spouse. But the Rule never intended to deprive the compulsory or intestate heirs of
their successional rights.

While A.M. No. 02-11-10-SC declares that a petition for declaration of absolute nullity
of marriage may be filed solely by the husband or the wife, it does not mean that the compulsory or
intestate heirs are without any recourse under the law. They can still protect their successional right, for,
as stated in the Rationale of the Rules on Annulment of Voidable Marriages and Declaration of Absolute
Nullity of Void Marriages, compulsory or intestate heirs can still question the validity of the marriage of
the spouses, not in a proceeding for declaration of nullity but upon the death of a spouse in a proceeding
for the settlement of the estate of the deceased spouse filed in the regular courts.[19]

It is emphasized, however, that the Rule does not apply to cases already commenced
before March 15, 2003 although the marriage involved is within the coverage of the Family Code. This is
so, as the new Rule which became effective on March 15, 2003[20] is prospective in its application. Thus,
the Court held in Enrico v. Heirs of Sps. Medinaceli,[21] viz.:

As has been emphasized, A.M. No. 02-11-10-SC covers marriages under the
Family Code of the Philippines, and is prospective in its application.[22] (Underscoring
supplied)

Petitioner commenced the nullity of marriage case against respondent Felicidad in 1995. The
marriage in controversy was celebrated on May 14, 1962. Which law would govern depends upon when
the marriage took place.[23]

The marriage having been solemnized prior to the effectivity of the Family Code, the applicable
law is the Civil Code which was the law in effect at the time of its celebration. [24] But the Civil Code is
silent as to who may bring an action to declare the marriage void. Does this mean that any person can
bring an action for the declaration of nullity of marriage?

We respond in the negative. The absence of a provision in the Civil Code cannot be construed as
a license for any person to institute a nullity of marriage case. Such person must appear to be the party
who stands to be benefited or injured by the judgment in the suit, or the party entitled to the avails of the
suit.[25] Elsewise stated, plaintiff must be the real party-in-interest. For it is basic in procedural law that
every action must be prosecuted and defended in the name of the real party-in-interest.[26]
Interest within the meaning of the rule means material interest or an interest in issue to be
affected by the decree or judgment of the case, as distinguished from mere curiosity about the question
involved or a mere incidental interest. One having no material interest to protect cannot invoke the
jurisdiction of the court as plaintiff in an action.When plaintiff is not the real party-in-interest, the case is
dismissible on the ground of lack of cause of action.[27]

Illuminating on this point is Amor-Catalan v. Court of Appeals,[28] where the Court held:

True, under the New Civil Code which is the law in force at the time the
respondents were married, or even in the Family Code, there is no
specific provision as to who can file a petition to declare the nullity of marriage;
however, only a party who can demonstrate proper interest can file the same. A petition
to declare the nullity of marriage, like any other actions, must be prosecuted or
defended in the name of the real party-in-interest and must be based on a cause of
action. Thus, in Nial v. Badayog, the Court held that the children have the personality to
file the petition to declare the nullity of marriage of their deceased father to
their stepmother as it affects their successional rights.

xxxx

In fine, petitioners personality to file the petition to declare the nullity of


marriage cannot be ascertained because of the absence of the divorce decree and the
foreign law allowing it.Hence, a remand of the case to the trial court for reception of
additional evidence is necessary to determine whether respondent Orlando was granted a
divorce decree and whether the foreign law which granted the same allows or restricts
remarriage. If it is proved that a valid divorce decree was obtained and the same did not
allow respondent Orlandos remarriage, then the trial court should declare respondents
marriage as bigamous and void ab initio but reduced the amount of moral damages
from P300,000.00 to P50,000.00 and exemplary damages from P200,000.00
toP25,000.00. On the contrary, if it is proved that a valid divorce decree was obtained
which allowed Orlando to remarry, then the trial court must dismiss the instant petition to
declare nullity of marriage on the ground that petitioner Felicitas Amor-Catalan lacks
legal personality to file the same.[29] (Underscoring supplied)

III. The case must be remanded to determine whether or not petitioner is a real-party-in-
interest to seek the declaration of nullity of the marriage in controversy.

In the case at bench, the records reveal that when Teofilo died intestate in 1992, his only surviving
compulsory heirs are respondent Felicidad and their son, Teofilo II. Under the law on succession,
successional rights are transmitted from the moment of death of the decedent and the compulsory heirs
are called to succeed by operation of law.[30]

Upon Teofilos death in 1992, all his property, rights and obligations to the extent of the value of the
inheritance are transmitted to his compulsory heirs. These heirs were respondents Felicidad and Teofilo
II, as the surviving spouse and child, respectively.

Article 887 of the Civil Code outlined who are compulsory heirs, to wit:

(1) Legitimate children and descendants, with respect to their legitimate parents and
ascendants;

(2) In default of the foregoing, legitimate parents and ascendants, with respect to their
legitimate children and descendants;

(3) The widow or widower;


(4) Acknowledged natural children, and natural children by legal fiction;

(5) Other illegitimate children referred to in Article 287 of the Civil Code.[31]

Clearly, a brother is not among those considered as compulsory heirs. But although a collateral relative,
such as a brother, does not fall within the ambit of a compulsory heir, he
still has a right to succeed to the estate. Articles 1001 and 1003 of the New Civil Code provide:

ART. 1001. Should brothers and sisters or their children survive with the widow
or widower, the latter shall be entitled to one-half of the inheritance and the brothers and
sisters or their children to the other half.

ART. 1003. If there are no descendants, ascendants, illegitimate children, or a


surviving spouse, the collateral relatives shall succeed to the entire estate of the
deceased in accordance with the following articles. (Underscoring supplied)

Indeed, only the presence of descendants, ascendants or illegitimate children excludes collateral
relatives from succeeding to the estate of the decedent. The presence of legitimate, illegitimate, or
adopted child or children of the deceased precludes succession by collateral relatives.[32] Conversely, if
there are no descendants, ascendants, illegitimate children, or a surviving spouse, the collateral relatives
shall succeed to the entire estate of the decedent.[33]

If respondent Teofilo II is declared and finally proven not to be the legitimate, illegitimate, or
adopted son of Teofilo, petitioner would then have a personality to seek thenullity of marriage of his
deceased brother with respondent Felicidad. This is so, considering that collateral relatives, like a brother
and sister, acquire successional right over the estate if the decedent dies without issue and without
ascendants in the direct line.

The records reveal that Teofilo was predeceased by his parents. He had no other
siblings but petitioner. Thus, if Teofilo II is finally found and proven to be not a legitimate,illegitimate, or
adopted son of Teofilo, petitioner succeeds to the other half of the estate of his brother, the first half being
allotted to the widow pursuant to Article 1001 of theNew Civil Code. This makes petitioner a real-party-
interest to seek the declaration of absolute nullity of marriage of his deceased brother with respondent
Felicidad. If the subject marriage is found to be void ab initio, petitioner succeeds to the entire estate.

It bears stressing, however, that the legal personality of petitioner to bring the nullity of marriage
case is contingent upon the final declaration that Teofilo II is not a legitimate, adopted, or illegitimate son
of Teofilo.

If Teofilo II is proven to be a legitimate, illegitimate, or legally adopted son of Teofilo, then


petitioner has no legal personality to ask for the nullity of marriage of his deceased brother and
respondent Felicidad. This is based on the ground that he has no successional right to be protected, hence,
does not have proper interest. For although the marriage in controversy may be found to be void from the
beginning, still, petitioner would not inherit. This is because the presence of descendant, illegitimate,[34] or
even an adopted child[35] excludes the collateral relatives from inheriting from the decedent.

Thus, the Court finds that a remand of the case for trial on the merits to determine the validity or
nullity of the subject marriage is called for. But the RTC is strictly instructed to dismiss the nullity of
marriage case for lack of cause of action if it is proven by evidence that Teofilo II is a legitimate,
illegitimate, or legally adopted son of Teofilo Carlos, the deceased brother of petitioner.

IV. Remand of the case regarding the question of filiation of respondent Teofilo II is proper
and in order. There is a need to vacate the disposition of the trial court as to the other causes of
action before it.
Petitioner did not assign as error or interpose as issue the ruling of the CA on the remand of the case
concerning the filiation of respondent Teofilo II. This notwithstanding, We should not leave the matter
hanging in limbo.

This Court has the authority to review matters not specifically raised or assigned as error by the
parties, if their consideration is necessary in arriving at a just resolution of the case.[36]

We agree with the CA that without trial on the merits having been conducted in the case, petitioners bare
allegation that respondent Teofilo II was adopted from an indigent couple is insufficient to support a total
forfeiture of rights arising from his putative filiation. However, We are not inclined to support its
pronouncement that the declaration of respondent Felicidad as to the illegitimate filiation of respondent
Teofilo II is more credible. For the guidance of the appellate court, such declaration of respondent
Felicidad should not be afforded credence. We remind the CA of the guaranty provided by Article 167 of
the Family Code to protect the status of legitimacy of a child, to wit:

ARTICLE 167. The child shall be considered legitimate although the mother may have
declared against its legitimacy or may have been sentenced as an
adulteress. (Underscoring supplied)

It is stressed that Felicidads declaration against the legitimate status of Teofilo II is the very act that is
proscribed by Article 167 of the Family Code. The language of the law is unmistakable. An assertion by
the mother against the legitimacy of her child cannot affect the legitimacy of a child born or conceived
within a valid marriage.[37]

Finally, the disposition of the trial court in favor of petitioner for causes of action concerning
reconveyance, recovery of property, and sum of money must be vacated. This has to be so, as said
disposition was made on the basis of its finding that the marriage in controversy was null and void ab
initio.
WHEREFORE, the appealed Decision is MODIFIED as follows:

1. The case is REMANDED to the Regional Trial Court in regard to the action on the status and
filiation of respondent Teofilo Carlos II and the validity or nullity of marriage between
respondent Felicidad Sandoval and the late Teofilo Carlos;

2. If Teofilo Carlos II is proven to be the legitimate, or illegitimate, or legally adopted son of the
late Teofilo Carlos, the RTC is strictly INSTRUCTED to DISMISS theaction for nullity
of marriage for lack of cause of action;

3. The disposition of the RTC in Nos. 1 to 8 of the fallo of its decision is VACATED AND SET
ASIDE.

The Regional Trial Court is ORDERED to conduct trial on the merits with dispatch and to give
this case priority in its calendar.

No costs.

SO ORDERED.

THIRD DIVISION

G.R. No. 191240, July 30, 2014

CRISTINA B. CASTILLO, Petitioner, v. PHILLIP R. SALVADOR, Respondent.


DECISION

PERALTA, J.:

Before us is a petition for review on certiorari which assails the Decision1 dated February 11, 2010 of the
Court of Appeals (CA) in CA-G.R. CR No. 30151 with respect only to the civil aspect of the case as
respondent Phillip R. Salvador had been acquitted of the crime of estafa.

Respondent Phillip Salvador and his brother Ramon Salvador were charged with estafa under Article 315,
paragraph 2 (a) of the Revised Penal Code in an Information2 which reads:chanRoblesvirtualLawlibrary

That during the period from March 2001 up to May 2002, in the City of Las Piñas, Philippines, and
within the jurisdiction of this Honorable Court, the above-named accused, conspiring and confederating
together and both of them mutually helping and aiding one another, with intent to gain and by means of
false pretenses or fraudulent acts executed prior to or simultaneously with the commission of the fraud,
did then and there willfully, unlawfully and feloniously defraud the complainant CRISTINA B.
CASTILLO, in the amount of US$100,000.00 in the following manner, to wit: Respondents convinced
the complainant to invest into the remittance business in the name of accused PHILLIP R. SALVADOR
in Hongkong, representing to her that they will personally take charge of the operations and marketing of
the said business, assuring her with huge profits because of the popularity of accused PHILLIP R.
SALVADOR, knowing very well that the said manifestations/representations and fraudulent
manifestations were false and were intended only to exact money from the Complainant, and by reason of
the said false representations made by both accused, the Complainant gave and entrusted to the accused
the amount of US$100,000.00 as seed money to start the operations of the business and the said accused,
once in the possession of the said amount of money, misappropriated, misapplied and/or converted the
same to their own personal use and benefit, to the damage and prejudice of the Complainant in the
aforementioned amount of US$100,000.00.

CONTRARY TO LAW.3

Upon their arraignment, respondent and his brother Ramon pleaded not guilty4 to the offense charged.

Trial on the merits thereafter ensued.

Petitioner Cristina B. Castillo testified that she is engaged in real estate business, educational institution,
boutique, and trading business.5 She met respondent through a common friend in December 2000 and
became close since then. Respondent had told her that his friends, Jinggoy Estrada and Rudy Fernandez,
were engaged in the freight and remittance business and that Jinggoy even brought him to Hong Kong
and Singapore to promote the former's business.6 Petitioner eventually met respondent’s brother and
manager, Ramon Salvador, to whom she volunteered to financially help respondent in his bid for the
Vice-Mayoralty race in Mandaluyong.7 It was also in the same meeting that they talked about the matter
of engaging in a freight and remittance business.8 Respondent enticed petitioner to go to Hong Kong to
see for herself the viability of such business and Ramon suggested to use respondent’s name to attract the
overseas contract workers.9cralawred

In March 2001, petitioner and her husband, together with respondent and a certain Virgilio Calubaquib
went to Hong Kong and they witnessed respondent’s popularity among the Filipino domestic helpers.10
In April 2001, the same group, with Ramon this time, went to Bangkok where respondent’s popularity
was again shown among the overseas Filipinos.11 In both instances, respondent promoted their
prospective business. In both trips, petitioner paid for all the travel expenses and even gave respondent
US$10,000.00 as pocket money for the Hong Kong trip and another US$10,000.00 for the Bangkok
trip.12 Her accountant introduced her to a certain Roy Singun who is into the freight and money
remittance business.13 In August 2001, respondent initiated a trip to Palau, to observe Singun’s business
thereat to which petitioner acceded.14 Petitioner paid for the travel expenses and even gave respondent
US$20,000.00.15 In October 2001, she and respondent had a training at Western Union at First World
Center in Makati City.16cralawred

As petitioner had deeply fallen in love with respondent and since she trusted him very much as he even
acted as a father to her children when her annulment was ongoing, she agreed to embark on the remittance
business. In December 2001, she, accompanied by her mother, Zenaida G. Bondoc (Zenaida), and
Ramon, went to Hong Kong and had the Phillip Salvador Freight and Remittance International Limited
registered on December 27, 2001.17 A Memorandum of Articles of Incorporation and a Certificate of
Incorporation were issued.18 They also rented an office space in Tsimshatsui, Kowloon, Hong Kong
which they registered as their office address as a requirement for opening a business in Hong Kong, thus,
a Notification of Situation of Registered Office was also issued.19 She agreed with respondent and Ramon
that any profit derived from the business would be equally divided among them and that respondent
would be in charge of promotion and marketing in Hong Kong, while Ramon would take charge of the
operations of business in the Philippines and she would be financing the business.20cralawred

The business has not operated yet as petitioner was still raising the amount of US$100,000.00 as capital
for the actual operation.21 When petitioner already had the money, she handed the same to respondent in
May 2002 at her mother’s house in Las Piñas City, which was witnessed by her disabled half-brother
Enrico B. Tan (Enrico).22 She also gave respondent P100,000.00 in cash to be given to Charlie Chau,
who is a resident of Hong Kong, as payment for the heart-shaped earrings she bought from him while
she was there. Respondent and Ramon went to Hong Kong in May 2002. However, the proposed
business never operated as respondent only stayed in Hong Kong for three days. When she asked
respondent about the money and the business, the latter told her that the money was deposited in a
bank.23 However, upon further query, respondent confessed that he used the money to pay for his other
obligations.24 Since then, the US$100,000.00 was not returned at all.

On cross-examination, petitioner testified that she fell deeply in love with respondent and was convinced
that he truly loved her and intended to marry her once there would be no more legal impediment;25 that
she helped in financing respondent’s campaign in the May 2001 elections.26 As she loved respondent so
much, she gave him monthly allowances amounting to hundreds of thousands of pesos because he had no
work back then.27 She filed the annulment case against her husband on November 21, 2001 and
respondent promised her marriage.28 She claimed that respondent and Ramon lured her with sweet
words in going into the freight and remittance business, which never operated despite the money she had
given respondent.29 She raised the US$100,000.00 by means of selling and pawning her pieces of
diamond jewelry.30cralawred

Petitioner admitted being blinded by her love for respondent which made her follow all the advice given
by him and his brother Ramon, i.e., to save money for her and respondent’s future because after the
annulment, they would get married and to give the capital for the remittance business in cash so as not to
jeopardize her annulment case.31 She did not ask for a receipt for the US$100,000.00 she gave to
respondent as it was for the operational expenses of a business which will be for their future, as all they
needed to do was to get married.32 She further testified that after the US$100,000.00 was not returned,
she still deposited the amount of P500,000.00 in respondent’s UCPB bank account33 and also to Ramon’s
bank accounts.34 And while respondent was in the United States in August

2003, she still gave him US$2,000.00 as evidenced by a Prudential Telegraphic Transfer
Application35dated August 27, 2003.

Petitioner’s mother, Zenaida, corroborated her daughter’s testimony that she was with her and Ramon
when they went to Hong Kong in December 2001 to register the freight and remittance business.36 She
heard Charlie Chau, her daughter's friend, that a part of his office building will be used for the said
remittance business.37 Enrico Tan, also corroborated her sister's claim that she handed the money to
respondent in his presence.38cralawred

Respondent testified that he and petitioner became close friends and eventually fell in love and had an
affair.39 They traveled to Hong Kong and Bangkok where petitioner saw how popular he was among the
Filipino domestic helpers,40 which led her to suggest a remittance business. Although hesitant, he has
friends with such business.41 He denied that petitioner gave him US$10,000.00 when he went to Hong
Kong and Bangkok.42 In July 2001, after he came back from the United States, petitioner had asked him
and his brother Ramon for a meeting.43 During the meeting, petitioner brought up the money remittance
business, but Ramon told her that they should make a study of it first.44 He was introduced to Roy Singun,
owner of a money remittance business in Pasay City.45 Upon the advise of Roy, respondent and
petitioner, her husband and Ramon went to Palau in August 2001.46 He denied receiving US$20,000.00
from petitioner but admitted that it was petitioner who paid for the plane tickets.47 After their Palau trip,
they went into training at Western Union at the First World Center in Makati City..48 It was only in
December 2001 that Ramon, petitioner and her mother went to Hong Kong to register the business, while
he took care of petitioner’s children here.49 In May 2002, he and Ramon went back to Hong Kong but
denied having received the amount of US$100,000.00 from petitioner but then admitted receipt of the
amount of P100,000.00 which petitioner asked him to give to Charlie Chau as payment for the pieces of
diamond jewelry she got from him,50 which Chau had duly acknowledged.51 He denied Enrico’s
testimony that petitioner gave him the amount of US$100,000.00 in his mother’s house.52 He claimed
that no remittance business was started in Hong Kong as they had no license, equipment, personnel and
money to operate the same.53 Upon his return to the Philippines, petitioner never asked him about the
business as she never gave him such amount.54 In October 2002, he intimated that he and petitioner even
went to Hong Kong again to buy some goods for the latter’s boutique.55 He admitted that he loved
petitioner and her children very much as there was a time when petitioner’s finances were short, he gave
her P600,000.00 for the enrollment of her children in very expensive schools.56 It is also not true that he
and Ramon initiated the Hong Kong and Bangkok trips.57cralawred

Ramon testified that it was his brother respondent who introduced petitioner to him.58 He learned of
petitioner’s plan of a remittance business in July 2001 and even told her that they should study it first.59
He was introduced to Roy Singun who operates a remittance business in Pasay and who suggested that
their group observe his remittance business in Palau. After their Palau trip, petitioner decided to put up a
similar business in Hong Kong and it was him who suggested to use respondent’s name because of name
recall.60 It was decided that he would manage the operation in Manila and respondent would be in charge
of promotion and marketing in Hong Kong, while petitioner would be in charge of all the business
finances.61 He admitted that he went to Hong Kong with petitioner and her mother to register said
business and also to buy goods for petitioner’s boutique.62 He said that it was also impossible for Chau
to offer a part of his office building for the remittance business because there was no more space to
accommodate it.63 He and respondent went to Hong Kong in May 2002 to examine the office
recommended by Chau and the warehouse of Rudy Fernandez thereat who also offered to help.64 He then
told Chau that the remittance office should be in Central Park, Kowloon, because majority of the Filipinos
in Hong Kong live there.65 He concluded that it was impossible for the business to operate immediately
because they had no office, no personnel and no license permit.66 He further claimed that petitioner never
mentioned to him about the US$100,000.00 she gave to respondent,67 and that he even traveled again
with petitioner to Bangkok in October 2002, and in August 2003.68 He denied Enrico’s allegation that he
saw him at his mother’s house as he only saw Enrico for the first time in court.69cralawred

On April 21, 2006, the RTC rendered a Decision,70 the dispositive portion of which
reads:chanRoblesvirtualLawlibrary

WHEREFORE, accused PHILLIP SALVADOR is found GUILTY beyond reasonable doubt of the crime
of Estafa under Article 315, par. 2 (a) of the Revised Penal Code and is hereby sentenced to suffer the
indeterminate sentence of four (4) years, two (2) months and one (1) day of prisyon (sic) correctional
(sic) maximum as minimum to twenty (20) years of reclusion temporal maximum as maximum and to
indemnify the private complainant in the amount of ONE HUNDRED THOUSAND DOLLARS
(US$100,000.00) or its equivalent in Philippine currency.

With respect to accused RAMON SALVADOR, he is ACQUITTED for insufficiency of evidence.

SO ORDERED.71

Respondent appealed his conviction to the CA. The parties filed their respective pleadings, after which,
the case was submitted for decision.

On February 11, 2010, the CA rendered its Decision reversing the decision of the RTC, the decretal
portion of which reads:chanRoblesvirtualLawlibrary

WHEREFORE, premises considered, the appealed decision of Branch 202 of the RTC of Las Piñas City,
dated April 21, 2006, is hereby REVERSED AND SET ASIDE and accused appellant PHILLIP R.
SALVADOR is ACQUITTED of the crime of Estafa.72chanrobleslaw

Petitioner files the instant petition on the civil aspect of the case alleging
that:chanRoblesvirtualLawlibrary

THE TRIAL COURT WAS CORRECT IN CONVICTING THE RESPONDENT SO THAT EVEN IF
THE COURT OF APPEALS DECIDED TO ACQUIT HIM IT SHOULD HAVE AT LEAST
RETAINED THE AWARD OF DAMAGES TO THE PETITIONER.73chanrobleslaw

We find no merit in the petition.


To begin with, in Manantan v. CA,74 we discussed the consequences of an acquittal on the civil liability of
the accused as follows:chanRoblesvirtualLawlibrary

Our law recognizes two kinds of acquittal, with different effects on the civil liability of the accused. First
is an acquittal on the ground that the accused is not the author of the act or omission complained of. This
instance closes the door to civil liability, for a person who has been found to be not the perpetrator of any
act or omission cannot and can never be held liable for such act or omission. There being no delict, civil
liability ex delicto is out of the question, and the civil action, if any, which may be instituted must be
based on grounds other than the delict complained of. This is the situation contemplated in Rule III of the
Rules of Court. The second instance is an acquittal based on reasonable doubt on the guilt of the accused.
In this case, even if the guilt of the accused has not been satisfactorily established, he is not exempt from
civil liability which may be proved by preponderance of evidence only. This is the situation contemplated
in Article 29 of the Civil Code, where the civil action for damages is “for the same act or omission.” x x
x.75

A reading of the CA decision would show that respondent was acquitted because the prosecution failed to
prove his guilt beyond reasonable doubt. Said the CA:chanRoblesvirtualLawlibrary

The evidence for the prosecution being insufficient to prove beyond reasonable doubt that the crime as
charged had been committed by appellant, the general presumption, “that a person is innocent of the
crime or wrong, stands in his favor. The prosecution failed to prove that all the elements of estafa are
present in this case as would overcome the presumption of innocence in favor of appellant. For in fact, the
prosecution's primary witness herself could not even establish clearly and precisely how appellant
committed the alleged fraud. She failed to convince us that she was deceived through misrepresentations
and/or insidious actions, in venturing into a remittance business. Quite the contrary, the obtaining
circumstance in this case indicate the weakness of her submissions.76

Thus, since the acquittal is based on reasonable doubt, respondent is not exempt from civil liability which
may be proved by preponderance of evidence only. In Encinas v. National Bookstore, Inc.,77we explained
the concept of preponderance of evidence as follows:chanRoblesvirtualLawlibrary

x x x Preponderance of evidence is the weight, credit, and value of the aggregate evidence on either side
and is usually considered to be synonymous with the term “greater weight of the evidence” or “greater
weight of the credible evidence.” Preponderance of evidence is a phrase which, in the last analysis, means
probability of the truth. It is evidence which is more convincing to the court as worthy of belief than that
which is offered in opposition thereto.78

The issue of whether petitioner gave respondent the amount of US$100,000.00 is factual. While we are
not a trier of facts, there are instances, however, when we are called upon to re-examine the factual
findings of the trial court and the Court of Appeals and weigh, after considering the records of the case,
which of the conflicting findings is more in accord with law and justice.79 Such is the case before us.

In discrediting petitioner’s allegation that she gave respondent US$100,000.00 in May 2002, the CA
found that: (1) petitioner failed to show how she was able to raise the money in such a short period of
time and even gave conflicting versions on the source of the same; (2) petitioner failed to require
respondent to sign a receipt so she could have a record of the transaction and offered no plausible reason
why the money was allegedly hand-carried to Hong Kong; (3) petitioner’s claim of trust as reason for not
requiring respondent to sign a receipt was inconsistent with the way she conducted her previous
transactions with him; and (4) petitioner’s behavior after the alleged fraud perpetrated against her was
inconsistent with the actuation of someone who had been swindled.

We find no reversible error committed by the CA in its findings.

Petitioner failed to prove on how she raised the money allegedly given to respondent. She testified that
from December 2001 to May 2002, she was raising the amount of US$100,000.00 as the capital for the
actual operation of the Phillip Salvador Freight and Remittance International Limited in Hong Kong,80
and that she was able to raise the same in May 2002.81 She

did so by selling82 or pawning83 her pieces of diamond jewelry. However, there was no documentary
evidence showing those transactions within the period mentioned. Upon further questioning on cross-
examination on where she got the money, she then said that she had plenty of dollars as she is a frequent
traveler to Hong Kong and Bangkok to shop for her boutique in Glorietta and Star Mall.84 Such
testimony contradicts her claim that she was still raising the money for 5 months and that she was only
able to formally raise the money in May 2002.

There was also no receipt that indeed US$100,000.00 was given by petitioner to respondent. Petitioner in
her testimony, both in the direct and cross examinations, said that the US$100,000.00 given to respondent
was for the actual expenses for setting up the office and the operation of the business in Hong Kong.85
She claimed that she treated the freight and remittance business like any of her businesses; 86 that she,
respondent, and the latter’s brother even agreed to divide whatever profits they would have from the
business;87 and that giving US$100,000.00 to respondent was purely business to her.88 She also said that
she kept records of all her business, such that, if there are no records, there are no funds entrusted89.
Since petitioner admitted that giving the money to respondent was for business, there must be some
records of such transaction as what she did in her other businesses.

In fact, it was not unusual for petitioner to ask respondent for some documents evidencing the latter's
receipt of money for the purpose of business as this was done in her previous business dealings with
respondent. She had asked respondent to execute a real estate mortgage on his condominium unit90 for
the P5 million she loaned him in August 2001. Also, when petitioner gave respondent an additional loan
of P10 million in December 2001, for the latter to redeem the title to his condominium unit from the bank,
she had asked him to sign an acknowledgment receipt for the total amount of P15 million he got from
her.91 She had done all these despite her testimony that she trusted respondent from the day they met in
December 2000 until the day he ran away from her in August 2003.92cralawred

Petitioner insists that she did not ask for any acknowledgment receipt from respondent, because the latter
told her not to have traces that she was giving money to him as it might jeopardize her then ongoing
annulment proceedings. However, petitioner's testimony would belie such claim of respondent being
cautious of the annulment proceedings. She declared that when she and her husband separated, respondent
stood as a father to her children.93 Respondent attended school programs of her children,94 and fetched
them from school whenever the driver was not around.95 In fact, at the time the annulment case was
already pending, petitioner registered the freight and remittance business under respondent’s name and
the local branch office of the business would be in petitioner's condominium unit in Makati.96 Also,
when petitioner went with her mother and Ramon to Hong Kong to register the business, it was
respondent who took care of her children. She intimated that it was respondent who was insistent in
going to their house.

Worthy to mention is that petitioner deposited the amount of P500,000.00 to respondent's account with
United Coconut Planters Bank (UCPB) in July 2003.97 Also, when respondent was in New York in
August 2003, petitioner sent him the amount of US$2,000.00 by telegraphic transfer.98 Petitioner's act of
depositing money to respondent's account contradicted her claim that there should be no traces that she
was giving money to respondent during the pendency of the annulment case.

Petitioner conceded that she could have either bought a manager's check in US dollars from the bank or
send the money by bank transfer, but she did not do so on the claim that there might be traces of the
transaction.99 However, the alleged US$100,000.00 was supposed to be given to respondent because of
the freight and remittance business; thus, there is nothing wrong to have a record of the same, specially
since respondent had to account for the valid expenses he incurred with the money.100cralawred

The testimony of Enrico, petitioner's brother, declaring that he was present when petitioner gave
respondent the US$100,000.00 did not help. Enrico testified that when petitioner filed the instant case in
September 2004, another case was also filed by petitioner against respondent and his brother Ramon in
the same City Prosecutor's office in Las Piñas where Enrico had submitted his affidavit. Enrico did not
submit an affidavit in this case even when he allegedly witnessed the giving of the money to respondent
as petitioner told him that he could just testify for the other case. However, when the other case was
dismissed, it was then that petitioner told him to be a witness in this case. Enrico should have been
considered at the first opportunity if he indeed had personal knowledge of the alleged giving of money to
respondent. Thus, presenting Enrico as a witness only after the other case was dismissed would create
doubt as to the veracity of his testimony.

WHEREFORE, the petition for review is DENIED. The Decision dated February 11, 2010, of the
Court of Appeals in CA-G.R. CR No. 30151, is hereby AFFIRMED.

SO ORDERED.
A.C. No. 4697, November 25, 2014

FLORENCIO A. SALADAGA, Complainant, v. ATTY. ARTURO B. ASTORGA, Respondent.

A.C. NO. 4728

FLORENCIO A. SALADAGA, Complainant, v. ATTY. ARTURO B. ASTORGA, Respondent.

DECISION

LEONARDO-DE CASTRO, J.:

Membership in the legal profession is a high personal privilege burdened with conditions,1 including
continuing fidelity to the law and constant possession of moral fitness. Lawyers, as guardians of the law,
play a vital role in the preservation of society, and a consequent obligation of lawyers is to maintain the
highest standards of ethical conduct.2 Failure to live by the standards of the legal profession and to
discharge the burden of the privilege conferred on one as a member of the bar warrant the suspension or
revocation of that privilege.

The Factual Antecedents

Complainant Florencio A. Saladaga and respondent Atty. Arturo B. Astorga entered into a “Deed of Sale
with Right to Repurchase” on December 2, 1981 where respondent sold (with right of repurchase) to
complainant a parcel of coconut land located at Barangay Bunga, Baybay, Leyte covered by Transfer
Certificate of Title (TCT) No. T-662 for P15,000.00. Under the said deed, respondent represented that he
has “the perfect right to dispose as owner in fee simple” the subject property and that the said property is
“free from all liens and encumbrances.”3 The deed also provided that respondent, as vendor a retro, had
two years within which to repurchase the property, and if not repurchased within the said period, “the
parties shall renew [the] instrument/agreement.”4

Respondent failed to exercise his right of repurchase within the period provided in the deed, and no
renewal of the contract was made even after complainant sent respondent a final demand dated May 10,
1984 for the latter to repurchase the property. Complainant remained in peaceful possession of the
property until December 1989 when he received letters from the Rural Bank of Albuera (Leyte), Inc.
(RBAI) informing him that the property was mortgaged by respondent to RBAI, that the bank had
subsequently foreclosed on the property, and that complainant should therefore vacate the property.5

Complainant was alarmed and made an investigation. He learned the following:

(1) TCT No. T-662 was already cancelled by TCT No. T-3211 in the name of Philippine National Bank
(PNB) as early as November 17, 1972 after foreclosure proceedings;

(2) TCT No. T-3211 was cancelled by TCT No. T-7235 in the names of respondent and his wife on
January 4, 1982 pursuant to a deed of sale dated March 27, 1979 between PNB and respondent;

(3) Respondent mortgaged the subject property to RBAI on March 14, 1984, RBAI foreclosed on the
property, and subsequently obtained TCT No. TP-10635 on March 27, 1991.6

Complainant was subsequently dispossessed of the property by RBAI.7

Aggrieved, complainant instituted a criminal complaint for estafa against respondent with the Office of
the Provincial Prosecutor of Leyte, docketed as I.S. No. 95-144. The Provincial Prosecutor of Leyte
approved the Resolution8 dated April 21, 1995 in I.S. No. 95-144 finding that “[t]he facts of [the] case are
sufficient to engender a well-founded belief that Estafa x x x has been committed and that respondent
herein is probably guilty thereof.”9 Accordingly, an Information10 dated January 8, 1996 was filed before
the Municipal Trial Court (MTC) of Baybay, Leyte, formally charging respondent with the crime of
estafa under Article 316, paragraphs 1 and 2 of the Revised Penal Code,11 committed as follows:
On March 14, 1984, accused representing himself as the owner of a parcel of land known as Lot No. 7661
of the Baybay Cadastre, mortgaged the same to the Rural Bank of Albuera, Albuera, Leyte, within the
jurisdiction of this Honorable Court, knowing fully well that the possessor and owner at that time was
private complainant Florencio Saladaga by virtue of a Pacto de Retro Sale which accused executed in
favor of private complainant on 2nd December, 1981, without first redeeming/repurchasing the same.
[P]rivate complainant knowing of accused[’s] unlawful act only on or about the last week of February,
1991 when the rural bank dispossessed him of the property, the mortgage having been foreclosed, private
complainant thereby suffered damages and was prejudiced by accused[’s] unlawful transaction and
misrepresentation.

The aforementioned estafa case against respondent was docketed as Criminal Case No. 3112-A.

Complainant likewise instituted the instant administrative cases against respondent by filing before this
Court an Affidavit-Complaint12 dated January 28, 1997 and Supplemental Complaint13 dated February 27,
1997, which were docketed as A.C. No. 4697 and A.C. No. 4728, respectively. In both complaints,
complainant sought the disbarment of respondent.

The administrative cases were referred to the Integrated Bar of the Philippines (IBP) for investigation,
report and recommendation.14

In his Consolidated Answer15 dated August 16, 2003 filed before the IBP, respondent denied that his
agreement with complainant was a pacto de retro sale. He claimed that it was an equitable mortgage and
that, if only complainant rendered an accounting of his benefits from the produce of the land, the total
amount would have exceeded P15,000.00.

Report and Recommendation of the Investigating Commissioner and Resolution of the IBP Board of
Governors

In a Report and Recommendation16 dated April 29, 2005, the Investigating Commissioner of the IBP’s
Commission on Bar Discipline found that respondent was in bad faith when he dealt with complainant
and executed the “Deed of Sale with Right to Repurchase” but later on claimed that the agreement was
one of equitable mortgage. Respondent was also guilty of deceit or fraud when he represented in the
“Deed of Sale with Right to Repurchase” dated December 2, 1981 that the property was covered by TCT
No. T-662, even giving complainant the owner’s copy of the said certificate of title, when the said TCT
had already been cancelled on November 17, 1972 by TCT No. T-3211 in the name of Philippine
National Bank (PNB). Respondent made matters even worse, when he had TCT No. T-3211 cancelled
with the issuance of TCT No. T-7235 under his and his wife’s name on January 4, 1982 without
informing complainant. This was compounded by respondent’s subsequent mortgage of the property to
RBAI, which led to the acquisition of the property by RBAI and the dispossession thereof of
complainant. Thus, the Investigating Commissioner recommended that respondent be (1) suspended from
the practice of law for one year, with warning that a similar misdeed in the future shall be dealt with more
severity, and (2) ordered to return the sum of P15,000.00, the amount he received as consideration for
the pacto de retro sale, with interest at the legal rate.

Considering respondent’s “commission of unlawful acts, especially crimes involving moral turpitude, acts
of dishonesty, grossly immoral conduct and deceit,” the IBP Board of Governors adopted and approved
the Investigating Commissioner’s Report and Recommendation with modification as follows: respondent
is (1) suspended from the practice of law for two years, with warning that a similar misdeed in the future
shall be dealt with more severity, and (2) ordered to return the sum of P15,000.00 received in
consideration of the pacto de retro sale, with legal interest.17

The Court’s Ruling

The Court agrees with the recommendation of the IBP Board of Governors to suspend respondent from
the practice of law for two years, but it refrains from ordering respondent to return the P15,000.00
consideration, plus interest.

Respondent does not deny executing the “Deed of Sale with Right to Repurchase” dated December 2,
1981 in favor of complainant. However, respondent insists that the deed is not one of sale with pacto de
retro, but one of equitable mortgage. Thus, respondent argues that he still had the legal right to mortgage
the subject property to other persons. Respondent additionally asserts that complainant should render an
accounting of the produce the latter had collected from the said property, which would already exceed the
P15,000.00 consideration stated in the deed.

There is no merit in respondent’s defense.

Regardless of whether the written contract between respondent and complainant is actually one of sale
with pacto de retro or of equitable mortgage, respondent’s actuations in his transaction with complainant,
as well as in the present administrative cases, clearly show a disregard for the highest standards of legal
proficiency, morality, honesty, integrity, and fair dealing required from lawyers, for which respondent
should be held administratively liable.

When respondent was admitted to the legal profession, he took an oath where he undertook to “obey the
laws,” “do no falsehood,” and “conduct [him]self as a lawyer according to the best of [his] knowledge
and discretion.”18 He gravely violated his oath.

The Investigating Commissioner correctly found, and the IBP Board of Governors rightly agreed, that
respondent caused the ambiguity or vagueness in the “Deed of Sale with Right to Repurchase” as he was
the one who prepared or drafted the said instrument. Respondent could have simply denominated the
instrument as a deed of mortgage and referred to himself and complainant as “mortgagor” and
“mortgagee,” respectively, rather than as “vendor a retro” and “vendee a retro.” If only respondent had
been more circumspect and careful in the drafting and preparation of the deed, then the controversy
between him and complainant could have been avoided or, at the very least, easily resolved. His
imprecise and misleading wording of the said deed on its face betrayed lack of legal competence on his
part. He thereby fell short of his oath to “conduct [him]self as a lawyer according to the best of [his]
knowledge and discretion.”

More significantly, respondent transgressed the laws and the fundamental tenet of human relations as
embodied in Article 19 of the Civil Code:

Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act with
justice, give everyone his due, and observe honesty and good faith.

Respondent, as owner of the property, had the right to mortgage it to complainant but, as a lawyer, he
should have seen to it that his agreement with complainant is embodied in an instrument that clearly
expresses the intent of the contracting parties. A lawyer who drafts a contract must see to it that the
agreement faithfully and clearly reflects the intention of the contracting parties. Otherwise, the respective
rights and obligations of the contracting parties will be uncertain, which opens the door to legal disputes
between the said parties. Indeed, the uncertainty caused by respondent’s poor formulation of the “Deed
of Sale with Right to Repurchase” was a significant factor in the legal controversy between respondent
and complainant. Such poor formulation reflects at the very least negatively on the legal competence of
respondent.

Under Section 63 of the Land Registration Act,19 the law in effect at the time the PNB acquired the
subject property and obtained TCT No. T-3211 in its name in 1972, where a decree in favor of a
purchaser who acquires mortgaged property in foreclosure proceedings becomes final, such purchaser
becomes entitled to the issuance of a new certificate of title in his name and a memorandum thereof shall
be “indorsed upon the mortgagor’s original certificate.”20 TCT No. T-662, which respondent gave
complainant when they entered into the “Deed of Sale with Right to Repurchase” dated December 2,
1981, does not bear such memorandum but only a memorandum on the mortgage of the property to PNB
in 1963 and the subsequent amendment of the mortgage.

Respondent dealt with complainant with bad faith, falsehood, and deceit when he entered into the “Deed
of Sale with Right to Repurchase” dated December 2, 1981 with the latter. He made it appear that the
property was covered by TCT No. T-662 under his name, even giving complainant the owner’s copy of
the said certificate of title, when the truth is that the said TCT had already been cancelled some nine years
earlier by TCT No. T-3211 in the name of PNB. He did not even care to correct the wrong statement in
the deed when he was subsequently issued a new copy of TCT No. T-7235 on January 4, 1982,21 or barely
a month after the execution of the said deed. All told, respondent clearly committed an act of gross
dishonesty and deceit against complainant.

Canon 1 and Rule 1.01 of the Code of Professional Responsibility provide:


CANON 1 – A lawyer shall uphold the constitution, obey the laws of the land and promote respect for
law and legal processes.

Rule 1.01 – A lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct.

Under Canon 1, a lawyer is not only mandated to personally obey the laws and the legal processes, he is
moreover expected to inspire respect and obedience thereto. On the other hand, Rule 1.01 states the norm
of conduct that is expected of all lawyers.22

Any act or omission that is contrary to, prohibited or unauthorized by, in defiance of, disobedient to, or
disregards the law is “unlawful.” “Unlawful” conduct does not necessarily imply the element of
criminality although the concept is broad enough to include such element.23

To be “dishonest” means the disposition to lie, cheat, deceive, defraud or betray; be untrustworthy;
lacking in integrity, honesty, probity, integrity in principle, fairness and straightforwardness. On the other
hand, conduct that is “deceitful” means as follows:

[Having] the proclivity for fraudulent and deceptive misrepresentation, artifice or device that is used upon
another who is ignorant of the true facts, to the prejudice and damage of the party imposed upon. In order
to be deceitful, the person must either have knowledge of the falsity or acted in reckless and conscious
ignorance thereof, especially if the parties are not on equal terms, and was done with the intent that the
aggrieved party act thereon, and the latter indeed acted in reliance of the false statement or deed in the
manner contemplated to his injury.24

The actions of respondent in connection with the execution of the “Deed of Sale with Right to
Repurchase” clearly fall within the concept of unlawful, dishonest, and deceitful conduct. They violate
Article 19 of the Civil Code. They show a disregard for Section 63 of the Land Registration Act. They
also reflect bad faith, dishonesty, and deceit on respondent’s part. Thus, respondent deserves to be
sanctioned.

Respondent’s breach of his oath, violation of the laws, lack of good faith, and dishonesty are compounded
by his gross disregard of this Court’s directives, as well as the orders of the IBP’s Investigating
Commissioner (who was acting as an agent of this Court pursuant to the Court’s referral of these cases to
the IBP for investigation, report and recommendation), which caused delay in the resolution of these
administrative cases.

In particular, the Court required respondent to comment on complainant’s Affidavit-Complaint in A.C.


No. 4697 and Supplemental Complaint in A.C. No. 4728 on March 12, 1997 and June 25, 1997,
respectively.25 While he requested for several extensions of time within which to submit his comment, no
such comment was submitted prompting the Court to require him in a Resolution dated February 4, 1998
to (1) show cause why he should not be disciplinarily dealt with or held in contempt for such failure, and
(2) submit the consolidated comment.26 Respondent neither showed cause why he should not be
disciplinarily dealt with or held in contempt for such failure, nor submitted the consolidated comment.

When these cases were referred to the IBP and during the proceedings before the IBP’s Investigating
Commissioner, respondent was again required several times to submit his consolidated answer. He only
complied on August 28, 2003, or more than six years after this Court originally required him to do so.
The Investigating Commissioner also directed the parties to submit their respective position papers.
Despite having been given several opportunities to submit the same, respondent did not file any position
paper.27

Respondent’s disregard of the directives of this Court and of the Investigating Commissioner, which
caused undue delay in these administrative cases, contravenes the following provisions of the Code of
Professional Responsibility:

CANON 11 – A lawyer shall observe and maintain the respect due to the courts and to judicial officers
and should insist on similar conduct by others.

xxxx

CANON 12 – A lawyer shall exert every effort and consider it his duty to assist in the speedy and
efficient administration of justice.

xxxx

Rule 12.03 – A lawyer shall not, after obtaining extensions of time to file pleadings, memoranda or briefs,
let the period lapse without submitting the same or offering an explanation for his failure to do so.

Rule 12.04 – A lawyer shall not unduly delay a case, impede the execution of a judgment or misuse court
processes.

Respondent’s infractions are aggravated by the fact that he has already been imposed a disciplinary
sanction before. In Nuñez v. Atty. Astorga,28 respondent was held liable for conduct unbecoming an
attorney for which he was fined P2,000.00.

Given the foregoing, the suspension of respondent from the practice of law for two years, as
recommended by the IBP Board of Governors, is proper.

The Court, however, will not adopt the recommendation of the IBP to order respondent to return the sum
of P15,000.00 he received from complainant under the “Deed of Sale with Right to Repurchase.” This is
a civil liability best determined and awarded in a civil case rather than the present administrative cases.

In Roa v. Moreno,29 the Court pronounced that “[i]n disciplinary proceedings against lawyers, the only
issue is whether the officer of the court is still fit to be allowed to continue as a member of the Bar. Our
only concern is the determination of respondent’s administrative liability. Our findings have no material
bearing on other judicial action which the parties may choose to file against each other.” While the
respondent lawyer’s wrongful actuations may give rise at the same time to criminal, civil, and
administrative liabilities, each must be determined in the appropriate case; and every case must be
resolved in accordance with the facts and the law applicable and the quantum of proof required in each.
Section 5,30 in relation to Sections 131 and 2,32 Rule 133 of the Rules of Court states that in administrative
cases, such as the ones at bar, only substantial evidence is required, not proof beyond reasonable doubt as
in criminal cases, or preponderance of evidence as in civil cases. Substantial evidence is that amount of
relevant evidence which a reasonable mind might accept as adequate to justify a conclusion.33

The Court notes that based on the same factual antecedents as the present administrative cases,
complainant instituted a criminal case for estafa against respondent, docketed as Criminal Case No. 3112-
A, before the MTC. When a criminal action is instituted, the civil action for the recovery of civil liability
arising from the offense charged shall be deemed instituted with the criminal action unless the offended
party waives the civil action, reserves the right to institute it separately or institutes the civil action prior
to the criminal action.34 Unless the complainant waived the civil action, reserved the right to institute it
separately, or instituted the civil action prior to the criminal action, then his civil action for the recovery
of civil liability arising from the estafa committed by respondent is deemed instituted with Criminal Case
No. 3112-A. The civil liability that complainant may recover in Criminal Case No. 3112-A includes
restitution; reparation of the damage caused him; and/or indemnification for consequential
damages,35 which may already cover the P15,000.00 consideration complainant had paid for the subject
property.

WHEREFORE, respondent is hereby found GUILTY of the following: breach of the Lawyer’s Oath;
unlawful, dishonest, and deceitful conduct; and disrespect for the Court and causing undue delay of these
cases, for which he is SUSPENDED from the practice of law for a period of two (2) years, reckoned from
receipt of this Decision, with WARNING that a similar misconduct in the future shall be dealt with more
severely.

Let a copy of this Decision be furnished the Office of the Bar Confidant and the Integrated Bar of the
Philippines for their information and guidance. The Court Administrator is directed to circulate this
Decision to all courts in the country.

SO ORDERED.