#13 Butuan Development Corp. v. 21st Div.

of the Court of Appeals, et al

GR 197358 | April 5, 2007

FACTS: Butuan Development Corp. (BDC), which was still in the process of incorporation through
its then President Edmundo Satorre purchased from the Spouses Jose and Socorro Sering a 7,6923-
hectare parcel of land situated in Butuan city. Max Arriola, Jr., representing himself as the Chairman
of BDC and armed with a duly notarized Resolution of the BDC Board of Directors, mortgaged the
subject property to De Oro Resources Inc. (DORI) and its President Louie Libarios. BDC later on
was issued a Certificate of Incorporation. Upon discovering the real estate mortgage (REM) executed
by the Arriolas who misrepresented themselves as the owners and directors of BDC, BDC filed a
complaint for declaration of nullity of the REM with the RTC of Butuan city against Max Jr., and
other respondents surnamed Arriola, Libarios, and DORI.

As special and affirmative defense, Libarios and DORI claimed that the complaint should be
dismissed for failing to state a cause of action since at the time of the execution of the REM, BDC
did not yet exist as a corporation and could have claimed ownership of the subject property.

The trial court ruled in favor of BDC and denied the motions for reconsideration filed by the
respondents. On appeal however, the CA granted the petition and set aside the decision of the RTC.
BDC sought a reconsideration of the decision but was denied by the CA. Hence, the petition.

ISSUE: Whether or not the CA gravely abused its discretion when it set aside the RTC’s Orders ruling
that BDC’s complaint failed to state a cause of action.

HELD: The petition is meritorious. Prefatorily, there is a need to address the respondents’ claim that
BDC should have filed an appeal under Rule 45 of the Rules of Court instead of filing the certiorari
suit. The CA’s disposition is a final judgment, as distinguished from an interlocutory order, as the
same finally disposed of the petition and left nothing more to be done by the CA. Rule 45 of the Rules
of the Court states that a party desiring to appeal by certiorari from a judgment or a final order of the
CA may file with this Court a verified petition for review on certiorari within 15 days from notice of
the judgment or final order. However, BDC failed to file a petition for review on certiorari within the
period to do so and, instead, opted to file a petition for certiorari under Rule 65 with this Court.
Evidently, this petition for certiorari is merely being used by BDC as a substitute for the lost remedy of
appeal under Rule 45.

A party cannot substitute the special civil action of certiorari under Rule 65 for the remedy of
appeal. The existence and availability of the right of appeal are antithetical to the availability of the
special civil action of certiorari. Remedies of appeal and certiorari are mutually exclusive, not alternative
or successive. Hence, certiorari is not and cannot be a substitute for an appeal. While a petition for
certiorari is dismissible for being the wrong remedy, there are exceptions to this rule, to wit: a) when
public welfare and the advancement of public policy dictates; b) when the broader interest of justice
so requires; c) when the writs issued are null and void; or d) when the questioned order amounts to
an oppressive exercise of judicial authority.
 In view of the factual circumstances, the dismissal of the petition for certiorari would result in
the miscarriage of justice on account of the CA’s unwarranted dismissal of its complaint for its failure
to distinguish lack of cause of action to having no cause of action.

Therefore, the Supreme Court GRANTED the petition and REVERSED and SET ASIDE the
orders of the CA.

#14 Mendoza v. Peroxide Philippines, Inc.

GR 203492 | April 24, 2017

FACTS: An ejectment case was filed by petitioners Pablo Marcelo and Pablina Marcelo-Mendoza
against respondent Peroxide Phils., Inc. (PPI) in the MeTC of Valenzuela City. The MeTC ordered
PPI to vacate the subject property and to pay the amount of lease because as it turns out, Gregorio
Marcelo, the father and predecessor-in-interest of the petitioners, executed a Contract of Lease with
PPI over a parcel of land located in the barrio of Paso de Blas, Municipality of Valenzuela.

Affidavits of Third-Party Claims of United Energy Corporation and Springfield International,

Inc. were filed with the sheriff. A public auction was conducted over the levied properties of PPI that
were found inside the subject property and was sold for P2 Million to Pablo, as the highest bidder.
Aggrieved, the third-party claimants filed a complaint with the RTC of Quezon City to declare void
the sheriff’s sale and Certificate of Sale with prayer for a temporary restraining order (TRO) and a writ
of preliminary injunction (WPI). The trial court issued the WPI prayed for.

Considering that the order was not complied with, PPI was again constrained to file a motion
to direct the sheriff to re-padlock the subject property which was granted by the RTC. Hence, a Notice
to Vacate was served by the deputy sheriff of the RTC to Pablo asking him to voluntarily turn over
the subject property within five days from receipt thereof. For several days, Pablo refused to obey the
court's order, but he was eventually forced out of the subject property.

PPI filed a Motion for Ocular Inspection, which was eventually granted by the court a quo.
The court personally served to PPI an Order re-setting the ocular inspection to May 31, 2011.
Thereafter, the ocular inspection was again re-set to June 8, 2011. Aggrieved, PPI filed a Motion for
Reconsideration and Inhibition. The RTC issued an Omnibus Order denying PPI's Motion for
Reconsideration and Inhibition and granting the petitioners' motion to remove padlock on the gate of
the subject property.

Aggrieved, PPI filed a motion for reconsideration. Considering, however that no resolution
has yet been promulgated by the presiding judge after the lapse of a considerable period of five
months, PPI elevated the case before the CA which granted the petition. Upset by the foregoing
disquisition, the petitioners moved for reconsideration but was denied in the CA Resolution. Hence,
the present petition for review on certiorari.

ISSUE: Whether or not the CA erred in finding that the RTC committed grave abuse of discretion
in granting petitioners’ motion to remove the padlock of the subject property.
HELD: The petition is bereft of merit. The resolution of the issue of whether the CA erred in finding
that the RTC committed grave abuse of discretion in granting petitioners' motion to remove the
padlock of the subject property boils down to the propriety of the issuance of the WPI.
A preliminary injunction is an order granted at any stage of an action or proceeding prior to
the judgment or final order, requiring a party or a court, agency or a person to refrain from a particular
act or acts. It is the 'strong arm of equity,' an extraordinary peremptory remedy that must be used with
extreme caution. It is usually granted to prevent a party from committing an act or threatening the
immediate commission of an act that will cause irreparable injury or destroy the status quo.
Before a WPI may be issued, the concurrence of the following essential requisites must be
present, namely: (a) the invasion of right sought to be protected is material and substantial; (b) the
right of the complainant is clear and unmistakable; and (c) there is an urgent and paramount necessity
for the writ to prevent serious damage. To be entitled to the writ, it is sufficient that the complainant
shows that he has an ostensible right to the final relief prayed for in his complaint.
Under the factual setting of this case, PPI was able to sufficiently establish that it had a right
over the properties which should be protected while being litigated. Hence, the issuance by the lower
courts of the WPI and the order to padlock and re-padlock the subject property to enjoin the
petitioners from disposing the properties of PPI was warranted. Furthermore, the restoration of PPI
to the possession of the subject property is not tantamount to the disposition of the main case. PPI'
s restoration to possession pending litigation is a mere provisional remedy and is not determinative of
the question of validity of the petitioners' titles.
The Supreme Court DENIED the petition and AFFIRMED the Resolution of the Court of
Appeals.

#15 Siy v. Tomlin*

GR 205998 | April 24, 2017

FACTS: Petitioner William Anghian Siy filed a complaint for Recovery of Possession with Prayer for
Replevin against Frankie Domanog Ong, Chris Centeno, John Co Chua, and herein respondent Alvin
Tomlin before the RTC of Quezon City.

In his complaint, petitioner alleged that he is the owner of a 2007 model Range Rover with
Plate Number ZMG 272 which he purchased from Alberto Lopez III; that in 2010, he entrusted the
said vehicle to Ong, a businessman who owned a second-hand car sales showroom; that he delivered
the subject vehicle, together with all its documents of title and the blank deed of sale to Ong, with the
express intention of selling the vehicle through the latter as broker/second hand car dealer; that Ong
was able to sell the vehicle to Chua, who secured a certificate of registration in his name. Chua then
sold the vehicle to respondent Alvin Tomlin, who caused registration of the vehicle in his name; that
petitioner filed a complaint before the Quezon City Police District's Anti-Carnapping Section; that
Ong, upon learning of the complaint, met with petitioner to arrange the return of the vehicle; that
Ong still failed to surrender the vehicle; and that the vehicle was later impounded and taken into
custody by the PNP-Highway Patrol Group at Camp Crame, Quezon City after respondent attempted
to process a PNP clearance of the vehicle with a view to transferring ownership thereof. Petitioner
thus prayed that a writ of replevin be issued for the return of the vehicle to him, and that the
defendants be ordered to pay him attorney’s fees and the costs of suit.

After hearing the application, the trial court allowed the issuance of a Writ of Replevin in favor
of the plaintiff subject to the posting of the bond in the amount of EIGHT MILLION PESOS
(Php8,000,000.00). Petitioner posted the required ₱8 million bond which was approved by the trial
court.

Respondent filed an Omnibus Motion seeking to quash the Writ of Replevin, dismiss the
complaint, and turn over or return the vehicle to him. The trial court denied respondent’s Omnibus
Motion for lack of merit. It held that respondent's remedy is not to move to quash the writ of replevin,
but to post a counterbond within the reglementary period; that for failure to post said counterbond,
respondent's prayer for the return of the vehicle to him is premature; respondent moved for
reconsideration, but he was rebuffed just the same.

Respondent filed a Petition for Certiorari before the CA. The CA rendered the assailed
Decision granting the petition. Petitioner moved to reconsider, the CA remained unconvinced. Hence,
the present Petition.

ISSUE: Whether or not petitioner failed to allege all the material facts in the complaint for replevin

HELD: The petition must be denied. In a complaint for replevin, the claimant must convincingly
show that he is either the owner or clearly entitled to the possession of the object sought to be
recovered, and that the defendant, who is in actual or legal possession thereof, wrongfully detains the
same. Rule 60 of the Rules of Court allows a plaintiff, in an action for the recovery of possession of
personal property, to apply for a writ of replevin if it can be shown that he is the owner of the property
claimed or is entitled to the possession thereof. It must be borne in mind that replevin is a possessory
action the gist of which focuses on the right of possession that, in turn, is dependent on a legal basis
that, not infrequently, looks to the ownership of the object sought to be replevied.

This Court is not unaware of the practice by many vehicle buyers and second-hand car traders
of not transferring registration and ownership over vehicles purchased from their original owners, and
rather instructing the latter to execute and sign in blank deeds of sale covering these vehicles, so that
these buyers and dealers may freely and readily trade or re-sell the vehicles in the second-hand car
market without difficulty. From petitioner's own account, he constituted and appointed Ong as his
agent to sell the vehicle, surrendering to the latter the vehicle, all documents of title pertaining thereto,
and a deed of sale signed in blank, with full understanding that Ong would offer and sell the same to
his clients or to the public. Since Ong was able to sell the subject vehicle to Chua, petitioner thus
ceased to be the owner thereof. Nor is he entitled to the possession of the vehicle; together with his
ownership, petitioner lost his right of possession over the vehicle.

Considering that he was no longer the owner or rightful possessor of the subject vehicle,
petitioner may not seek a return of the same through replevin. On the other hand, respondent, who
obtained the vehicle from Chua who registered the same, is the rightful owner thereof, and as such, is
entitled to its possession. If at all, the remedy of petitioner is to file a case for estafa and other criminal
charges against Ong for his failure to remit the proceeds of the sale to petitioner.

The Supreme Court DENIED the petition and AFFIRMED the decision and resolution of
the Court of Appeals with the modification that the subject Land Rover Range Rover be
RETURNED to respondent Alvin Tomlin as the registered owner.

#16 Zaragoza v. Iloilo Santos Truckers, Inc.

GR 224022 | June 28, 2017

FACTS: Petitioner Teodorico Zaragoza bought a 3,058-square meter parcel of land located at
Cabatuan, Iloilo from his parents and had the same registered in his name. Unknown to him, his father
leased a portion of Lot 937-A to respondent Iloilo Santos Truckers, Inc. for a period of 8 years and
renewable for another 8 at the sole option of respondent. This notwithstanding, petitioner allowed
the lease to subsist and respondent had been diligent in paying its monthly rent amounting to
P10,000.00 per month pursuant to the lease contract.

Petitioner claimed that when his father died, respondent stopped paying rent. On the other
hand, respondent maintained that it was willing to pay rent, but was uncertain as to whom payment
should be made as it received separate demands from Florentino's heirs, including petitioner. Thus,
respondent filed an interpleader case before the RTC of Iloilo city. After due proceedings, the trial
court dismissed the action for interpleader, but at the same time, stating that respondent may avail of
the remedy of consignation. Pursuant thereto, respondent submitted a Manifestation and Notice
informing petitioner that it had consigned the aggregate amount of P521,396.8917 before the trial
court.

This notwithstanding, petitioner sent respondent a letter stating the same did not extinguish
the latter's obligation to pay rent because the amount consigned was insufficient to cover the unpaid
rentals plus interests from February 2007 to May 2011 in the amount of P752,878. 72. In this regard,
petitioner demanded that respondent pay said amount and at the same time, vacate the subject land
within fifteen (15) days from receipt of the letter. In its reply, respondent reiterated that it had already
paid rent representing monthly rentals from February 2007 to March 2011 and maintained that it is
not obligated to pay interests under the lease contract. Petitioner clarified that said amount was
insufficient and reiterated that his demand to pay was for the period of February 2007 to May 2011.
Thus, petitioner posited that respondent had continuously failed and refused to comply with the terms
and conditions of the lease contract concerning the payment of monthly rental, with or without
consignation. As his demands went unheeded, petitioner filed for unlawful detainer against respondent
before the MTCC of Iloilo City.

The MTCC ruled in favor of petitioner. On appeal to the RTC, the trial court reversed and set
aside the MTCC ruling and upheld the respondent’s consignation of the rental amounts. Dissatisfied,
petitioner appealed to the CA which affirmed the RTC’s ruling. Undaunted, petitioner moved for
reconsideration which was, however, denied. Hence, this petition.
ISSUE: Whether or not the CA correctly ruled that petitioner could not eject respondent from the
subject land as the latter fully complied with its obligation to pay monthly rent thru consignation.

HELD: The petition is meritorious. For the purpose of bringing an unlawful detainer suit, two
requisites must concur: (1) there must be failure to pay rent or comply with the conditions of the
lease, and (2) there must be demand both to pay or to comply and vacate. The first requisite refers to
the existence of the cause of action for unlawful detainer, while the second refers to the jurisdictional
requirement of demand in order that said cause of action may be pursued. Implied in the first requisite,
which is needed to establish the cause of action of the plaintiff in an unlawful detainer suit, is the
presentation of the contract of lease entered into by the plaintiff and the defendant, the same being
needed to establish the lease conditions alleged to have been violated. Thus, in Bachrach Corporation
v. Court of Appeals, the Court held that the evidence needed to establish the cause of action in an
unlawful detainer case is (1) a lease contract and (2) the violation of that lease by the defendant.

In other words, for an unlawful detainer suit to prosper, the plaintiff-lessor must show that:
first, initially, the defendant-lessee legally possessed the leased premises by virtue of a subsisting lease
contract; second, such possession eventually became illegal, either due to the latter's violation of the
provisions of the said lease contract or the termination thereof; third, the defendant-lessee remained
in possession of the leased premises, thus, effectively depriving the plaintiff-lessor enjoyment thereof;
and fourth, there must be a demand both to pay or to comply and vacate and that the suit is brought
within one (1) year from the last demand.

Thus, the crux of the controversy is whether or not the second requisite has been satisfied,
that is, whether or not respondent violated the terms and conditions of the lease contract, specifically
with regard to the payment of monthly rentals. According to the RTC and the CA, respondent did
not breach its obligation to pay rent as its consignation of its monthly rentals constitutes sufficient
compliance thereof. The RTC and the CA are mistaken. A closer reading of such letter-reply and
Manifestation and Notice reveals that the amount consigned with the RTC represents monthly rentals
only for the period of February 2007 to March 2011, which is two (2) whole months short of what
was being demanded by petitioner. In fact, petitioner pointed out such fact in his letter to respondent,
but the latter still refused to make any additional payments, by either making further consignations
with the RTC or directly paying petitioner.

From the foregoing, it appears that even assuming arguendo that respondent's consignation
of its monthly rentals with the RTC was made in accordance with law, it still failed to comply with its
obligation under the lease contract to pay monthly rentals. The said omission constitutes a violation
of the lease contract on the part of respondent.

The Supreme Court GRANTED the petition and REVERSED and SET ASIDE the Resolution of
the Court of Appeals.