RULE62- INTERPLEADER

1. Sy-Quia v. Sheriff of Ilocos Sur, GR 22807, October 10, 1921

FACTS:
Miguel and Feliciano executed a chattel mortgage in favor of petitioner Gregorio Sy-Quia on their mercantile establishment with all merchandise therein as security for a P6k
debt. It fell due on Feb. 03, 1917. The intent was to let the mortgagors sell the merchandise replenishing their stock from time to time and that the new stock should also be
subject to the mortgage.

Miguel executed another chattel mortgage on the same establishment and its contents in favor of respondent Filadelfo de Leon as security for P4,900, which mortgage was
recorded on May 14, 1924. On the latter date, petitioner requested the sheriff to take possession of the mortgaged property and sell it under the Chattel Mortgage Law. The
sheriff seized the establishment and its contents and fixed the date of sale. Respondent presented an adverse claim, alleging that the goods on which the chattel mortgage of
petitioner was given had long been sold before the chattel mortgage of respondent was executed, so the earlier chattel mortgage had no effect.

The sheriff, in doubt as to the priority of the conflicting claims, suspended the foreclosure proceedings and brought action under the Code of Civil Procedure S120 requiring
the two claimants to interplead.

Petitioner thus filed this petition for mandamus alleging that the sheriff’s duty to proceed with the sale was a ministerial one.

HELD:
Though it perhaps, would have been better practice for the sheriff to sell the property and hold the proceeds of the sale subject to the outcome of the action of interpleader,
we, nevertheless, are of the opinion that the facts shown do not justify our interference by mandamus. The sheriff might lay himself open to an action for damages if he sold
the goods without the consent of the holder of the last mortgage, and it does not appear that the petitioner offered to give bond to hold him harmless in such an event. In these
circumstances, his action in suspending the sale pending the determination of the action of interpleader seems justified.

The petition for mandamus should be addressed to the Courts of First Instance rather than to this court.

2. UCPB v. IAC, GR 72664-65, March 20, 1990, Feliciano, J., Third Division.
FACTS:
Petitioner UCPB had issued a manager’s check of P494k to respondent Makati Bel-Air Condominium Developers, Inc., having been purchased by Altiura Investors, Inc.
Altiura delivered the check to Makati Bel-Air as part payment on an office condomium unit. Petitioner received instructions from Altura to hold payment on the manager’s
check due to discrepancy in the office unit purchased, measuring only 124m2 instead of the 165m2 as stipulated in the contract of sale. Petitioner then received a letter from
Altiura requesting petitioner to hold payment of its manager’s check for 15 days while Altiura and Makati Bel-Air were settling their differences. Petitioner thus requested
Makati Bel-Air to hold in abeyance for 15 days the presentation of the manager’s check. But Makati Bel-Air did not agree to the request of petitioner.

Thus, petitioner filed a complaint-in-interpleader against Altiura and Makati Bel-Air for them to litigate with each other as to their claims over the funds represented by the
manager’s check involved. Trial court ordered deposit of the funds into a special account with any reputable banking institution.

Petitioner moved to withdraw complaint and dismiss counter-claim of Makati Bel-Air, stating that there was no longer any conflict between Makati Bel-Air and Altiura.
Makati Bel-Air delivered to petitioner the manager’s check. Trial court also ordered the release of the funds covered by the check to Altiura. Trial court stated that the motion
to withdraw complaint was mooted by its order releasing the funds to Altiura and that Makati Bel-Air’s counterclaim against petitioner was dismissed upon such release.

Makati Bel-Air moved for reconsideration of the dismissal of its counterclaim without success. IAC, on petition for certiorari, nullified the dismissal of Makati Bel-Air’s
counterclaim. Hence this petition.

HELD:
1) Under R9, S4 of RoC, a compulsory counterclaim is "one which arises out of or is necessarily connected with the transaction or occurrence that is the subject matter of the
opposing party's claim." Interpleader is a proper remedy where a bank which had issued a manager's check is subjected to opposing claims by persons who
respectively claim a right to the funds covered by the manager's check . The Bank is entitled to take necessary precautions so that, as far possible, it does not make a
mistake as to who is entitled to payment; the necessary precautions include, precisely, recourse to an interpleader suit.

Makati Bel-Air’s counterclaim arose out of or was necessarily connected with petitioner’s recourse of interpleader. Makati Bel-Air was in effect claiming that petitioner
refused in BF to honor its undertaking to pay represented by the manager’s check it issued. When trial court granted the motion for withdrawal of petitioner as having become
moot due to Makati Bel Air’s cancelling the sale to Altiura and return of the check to petitioner, trial court in effect held that petitioner’s recourse to interpleader was proper
and not a malicious maneuver to evade its obligation to pay. Thus, trial court could not have logically allowed Makati Bel-Air to recover on its counterclaim for damages
against petitioner.

2) Also, since Makati Bel-Air was a party to the contract of sale to Altiura for the payment of which the manager’s check was issued, it was aware, when it received said
check, that there was partial failure of consideration. Makati Bel-Air was also aware that petitioner was informed by Altiura of the claimed defect in Makati Bel-Air’s title to
the check. Thus, as to both Altiura and petitioner, Makati Bel-Air was not a holder in due course of the manager’s check.

3. Del Carmen v. Sps. Sabordo, GR 181723, August 11, 2014, Peralta, J., Third Division. (Interpleader improper where one party does not make a claim over the
subject matter)
FACTS:
In 1961, Sps Suico and several business partners entered into a business venture by establishing a rice and corn mill in Mandaue City, Cebu. They obtained a loan from DBP
and, to secure said loan, 4 lands of Sps. Suico, Lots 506, 512, 513, and. 514, were mortgaged. Later, the mortgage was foreclosed by DBP and ownership consolidated in it.
DBP later allowed Sps Suico to repurchase the lots by conditional sale. Sps. Suico were able to pay the downpayment and first monthly amortization, but no monthly
installments were made thereafter. Threatened with cancellation of the conditional sale, Sps Suico sold their rights to respondents Sps. Sabordo. Sps.
Sabordo were able to repurchase the foreclosed properties.

Sps Suico can Redeem- Sps Suico and Sps Sabordo executed a supplemental agreement whereby they affirmed that Lots 506 and 514 were sold to Sps Sabordo only as
usufructuaries. Restituto Sabordo filed with CFI/RTC an action for declaratory relief with damages raising the issue of whether Sps Suico had a right to recover from
respondents Lots 506 and 514.

RTC ruled that Sps Suico had until Aug. 31, 1987 to redeem Lots 506 and 514. CA ruled that Sps Suico had until Oct. 31, 1990 to exercise their option to redeem the lots for
P127,500. CA extended the period for 90 days from Feb. 13, 1991.

Mortgaged by Sps Sabordo- Toribio Suico died, leaving his widow and others, including petitioner, as legal heirs. Respondents mortgaged Lots 506 and 514 with Republic
Planters Bank (RPB) as security for a loan which later became delinquent.

Interplead, deposited- Thereafter, claiming that they are ready to pay the P127,500, but alleging that they cannot determine to whom payment shall be made, petitioner and
her co-heirs filed a complaint in RTC to compel respondents and RPB to interplead between themselves as to their interests on the P127,500. Heirs of Toribio deposited the
amount of P127, 500 with the RTC upon filing of said complaint.

ISSUE:
Contention: Respondents pray for dismissal of the complaint, alleging that the action for interpleader was improper since RPB is not laying any claim on the P127,500. RTC
dismissed petitioner’s complaint. CA affirmed. Hence this petition.
HELD: Improper.
1) Consignation is the act of depositing the thing due with the court or judicial authorities whenever the creditor cannot accept or refuses to accept payment, and it generally
requires a prior tender of payment. It should be distinguished from tender of payment which is the manifestation by the debtor to the creditor of his desire to comply with his
obligation, with the offer of immediate performance.

1.1) In Arzaga v. Rumbaoa, cited by petitioner, SC ruled that the deposit made with the court by the plaintiff therein is valid payment even without proper tender of
payment to defendants because plaintiff, upon making the deposit, expressly petitioned the court that defendants be notified to receive tender of payment. We held that
while the deposit by itself may be insufficient, but with the terms of the petition, there was offer of payment made to defendants.

Here, petitioners, upon making the deposit in RTC, did not ask RTC that respondents be notified to receive the amount deposited. There was no tender of payment. Instead,
what petitioners prayed for was that respondents and RPB be directed to interplead. Interpleader is not the proper remedy since RPB did not make any claim over the
amount consigned by petitioners with RTC.

2) Under Article 1256, the only instances where prior tender of payment is excused are: (1) when the creditor is absent or unknown, or does not appear at the place of
payment; (2) when the creditor is incapacitated to receive the payment at the time it is due; (3) when, without just cause, the creditor refuses to give a receipt; (4) when two or
more persons claim the same right to collect; and (5) when the title of the obligation has been lost. None of these instances are present in the instant case. Hence, the fact that
the subject lots are in danger of being foreclosed does not excuse petitioner and her co-heirs from tendering payment to respondents, as directed by the court.

4. Del Rosario v. Sandico, GR L-867, December 29, 1949, Feria, J., En Banc. (In tender of payment of judgment, Arts. 1256 and 1257 are inapplicable)
FACTS:
On July 8, 1944, CA rendered a decision, ordering plaintiffs to pay P3,944.20 to defendant Sandico. In view of defendant’s refusal to accept payment in Japanese war notes,
plaintiffs, on Oct 19, 1944, within 90d from finality of the CA decision, deposited into the court P3,944.20 in Japanese war notes. The P3,944.20 was payment to recover
possession and enjoyment of property delivered to defendant in antichresis.

Trial court accepted the payment deposited and ordered defendant to surrender to plaintiffs the possession of the land in dispute.
ISSUE:
Contention: Sandico appealed from this, claiming: 1) the payment in Japanese war notes is unacceptable, 2) the consignation of the amount by Ponciano Ong in behalf of 2 of
6 of the plaintiffs/judgment debtors was invalid since it was not made in conformity with Arts. 1176 and 1177 of the Civil Code (**Now Arts. 1256 and 1257 of NCC on
tender of payment and consignation).
HELD:
1) Japanese war notes payment is proper.
Art. 1170 (**Art. 1249 of NCC) quoted in the dissenting opinion is inapplicable:
"payment of debts of money shall be made in the specie stipulated and, should it not be possible to deliver such specie, in silver or gold coins legally current in
the Philippines, xxx."
Because the contract between the parties was to pay in PH pesos and not some other specifically defined specie of money. The phrase “specie stipulated” in Art. 1170 refers
to money different from that which is legal tender in PH. The obligation of a contract to pay money is to pay that which the law shall recognize as money when the payment
is to be made. (When the CA decision was rendered in 1944 [this is the time “when payment is to be made”], legal tender was Japanese war notes.)

2) Tender of payment of judgment into court is not the same as tender of payment of a contractual debt and consignation of the money due from a debtor to a creditor, and
therefore the requirements of articles 1176 and 1177 of the Civil Code are not applicable. "In case of a refusal of a tender of the amount due on a judgment, the court may
direct the money to be paid into court, and when this is done, order satisfaction of the judgment to be entered." The fact that the money deposited belonged to Ponciano Ong,
who succeeded by purchase into the rights and obligations of two of the six judgment debtors, did not make the payment unacceptable or insufficient to satisfy the judgment,
for "a voluntary payment into court of money due under a judgment by one of several obligors is a bar to an action against the others for the same debt or obligation."

5. Arreza v. Diaz, GR 133113, August 20, 2001, Quisumbing, J., Second Division. (R62, S5, par2.)
FACTS:
Interpleader case- Bliss Development Corporation is the owner of a housing unit in New Capitol Estates, QC. In the course of a conflict of ownership between petitioner and
respondent in RTC, Br. 146, Bliss filed a complaint for interpleader. RTC resolved the interpleader in favor of petitioner Arreza which became final and executory. Thus,
Bliss executed a contract to sell of the property to petitioner. Respondent was constrained to deliver the property with all its improvements to petitioner.

Reimbursement case- Thereafter, respondent Diaz filed a complaint against Bliss and Arreza in RTC, seeking reimbursement of P1.7M representing his cost of acquisition
and improvements on the property at 8% interest per annum. Petitioner moved to dismiss, citing res judicata in the interpleader case.

RTC denied the motion to dismiss. CA affirmed, holding that the interpleader case resolved only the issue of who between Arreza and Diaz has the better right over the
property in litigation, but it did not resolve the rights and obligations of the parties. Hence this petition.

HELD: Barred by res judicata.

1) Contention: Diaz argues that RTC in the interpleader case, Br. 146, did not acquire jurisdiction over the property as the action was filed in Makati while the property is in
QC.
Held:
But by asserting his right as buyer for value in GF of the property in his complaint and asking for relief arising therefrom, Diaz invoked the jurisdiction of RTC. Thus he is
now estopped from challenging the jurisdiction of said court after it had decided the case against him.

2) Contention: Diaz claims that there is no identity of causes of action between Case 94 (Interpleader case) and Case 96 (reimbursement case). A complaint for interpleader is
nothing more than the determination of rights over the subject matter involved.
Held:
The second paragraph of R62, S5 provides that the parties in an interpleader action may file counterclaims, crossclaims, third party complaints, and responsive pleadings
thereto, “as provided by these Rules.” This second paragraph was added to R62, S5 to expressly authorize the additional pleadings and claims enumerated therein, in the
interest of a complete adjudication of the controversy and its incidents. Thus, respondent should have filed his claims against Arreza in the interpleader action. Having
asserted his rights as buyer in GF and praying relief therefor, respondent should have crystallized his demand into specific claims for reimbursement.

The claim of respondent, being in the nature of a compulsory counterclaim, is now barred. A prior judgment is conclusive between the same parties on the same subject
matter and on the same cause of action not only as to matters which were decided in the first action, but also as to every other matter which the parties could have properly set
up in the prior suit.

(**See GR 213233, Diaz’s claim against Bliss is not barred by res judicata, only the claim against Arreza is barred since only Diaz and Arreza were the parties in the
interpleader case.)

6. Lui Enterprises, Inc. v. Zuellig Pharma Corporation, GR 193494, March 12, 2014, Leonen, J., Third Division. (R62, S5, default in interpleader)
FACTS:
Interpleader case- Petitioner Lui and respondent Zuellig entered into a 10year contract of lease over a land in Davao City. Respondent received a letter from respondent PH
Bank of Communications (PBC), claiming to be the new owner of the property. Respondent informed petitioner. Petitioner insisted on its right to collect the rent. Due to the
conflicting claims over the rent, respondent filed a complaint for interpleader with RTC Makati, consigning P604k as rental payments and praying that it be allowed to
consign in court its succeeding monthly rental payments.

Nullification of dation case- Petitioner moved to dismiss alleging that an earlier filed nullification of deed of dation in payment case pending in RTC Davao barred the filing
of the interpleader case. Petitioner filed this nullification case against PBC as to properties it dationed to PBC. The property leased to respondent was among those allegedly
dationed to PBC. Petitioner raised in said case the issue of which corporation had the better right over rental payments, which is the same issue in the interpleader case. Thus,
the subsequently filed interpleader case must be dismissed.

Default- RTC Makati declared petitioner in default for filing its motion to dismiss 4 days late.

Motion to set aside default- 1year after the order of default, petitioner filed a motion to set aside order of default in RTC Makati, alleging as excusable negligence its former
counsel’s negligence. As meritorious defense, petitioner argued that the earlier nullification of dation case barred the filing of the interpleader case.

RTC Makati, ruled in favor of PBC and awarded the total consigned amount of P6.681M to PBC.

Appellant’s brief- CA found petitioner’s appellant’s brief insufficient as not containing a subject index, page references to the record, table of cases, textbooks and statutes
cited, and statement of issues required in R44, S13. CA also affirmed RTC and found that petitioner filed its motion to dismiss 4 days late and that its motion to set aside
default failed to show excusable negligence. Hence this petition.

HELD:
1) Appellant’s brief insufficient, ground to dismiss appeal- Under R50, S1(f), CA may dismiss an appeal if the requirements for appellant’s brief under R44, S13(a), (c)-(f) are
not met. These requirements are the subject index, page references, and table of cases with textbooks and statutes cited. Petitioner’s brief lacked these. Thus, CA correctly
dismissed its appeal. While there are exceptions based on substantial compliance, petitioner did not substantially comply with the rules. It did not even correct its admitted
“Technical omissions” by filing an amended appellant’s brief with the required contents.

2) No excusable negligence- Petitioner filed its MtD 4 days late. It took 1 year from default to file a motion to set aside order of default. In said motion, petitioner only
blamed its counsel for the late filing of the answer without offering any excuse for the late filing. This is not excusable negligence in R9, S3(b). Thus, RTC Makati did not err
in not setting aside the default. Petitioner did not explain why its counsel failed to file the MtD on time. It just argued that courts should be liberal in setting aside orders of
default.

2.1) Contention: Petitioner argues that respondent Zuellig filed the interpleader case to compel petitioner and PBC to litigate their claims. Thus, declaring the other claimant
in default would ironically defeat the purpose of the suit.
Held:
An interpleader complaint may be filed by a lessee against those who have conflicting claims over the rent due for the property leased. This remedy is for the lessee to protect
him or her from "double vexation in respect of one liability." He or she may file the interpleader case to extinguish his or her obligation to pay rent, remove him or her from
the adverse claimants' dispute, and compel the parties with conflicting claims to litigate among themselves. Here, Zuellig filed the interpleader case to extinguish its
obligation to pay rent. Its purpose was not defeated when RTC Makati declared petitioner in default.

At any rate, an adverse claimant in an interpleader case may be declared in default. R62, S5 states that a claimant who fails to answer within the required period may, on
motion, be declared in default. The consequence of the default is that the court may "render judgment barring [the defaulted claimant] from any claim in respect to the subject
matter." The Rules would not have allowed claimants in interpleader cases to be declared in default if it would "ironically defeat the very purpose of the suit."

3) Contention: Petitioner argues that the nullification of dation case bars the filing of the interpleader case.
Held:
The requisites of litis pendentia are:
1) Identity of parties or at least such as represent the same interest in both actions;
2) Identity of rights asserted and reliefs prayed for, the reliefs being founded on the same facts;
3) The identity in the two cases should be such that the judgment that may be rendered in one would, regardless of which party is successful, amount to res
judicata in the other.
Here, there is no litis pendentia. 1) There is no identity of parties sinze Zuellig is not a party to the nullification of dation case in RTC Davao. 2) There is no identity of rights
asserted and reliefs prayed for. Petitioner filed the nullification of dation case to nullify said dation to PBC and recover ownership of the leased premises. Zuellig filed the
interpleader case to consign rentals in court and extinguish its obligation as lessee. Thus, there is no litis pendentia.

7. Wack Wack Golf & Country Club, Inc. v. Won, GR L-23851, March 26, 1976, Castro, J., En Banc. (No more interpleader once judgment is rendered against one
party)
FACTS:
Wack Wack filed a complaint for interpleader. It alleges that:
Respondent Lee Won claims ownership of its membership fee certificate 201 by virtue of the decision rendered in Civil case 26044 of CFI, Lee Won v. Wack Wack.
Respondent Bienvenido Tan also claims to be the owner of membership fee certificate 201 by virtue of membership fee certificate 201-serial 1199 issued to him. Wack Wack
has no interest in the membership fee certificate 201 and it has no means of determining who of the 2 respondents is the owner. Under its Articles of Incorporation and by-
laws, Wack Wack cannot issue two separate certificates for the same membership fee certificate 201. Wackwack thus prays that respondents Lee and Tan be ordered to
interplead and litigate their conflicting claims.

CFI, finding the grounds of res judicata to be well-taken, dismissed Wackwack’s complaint. Hence this appeal.

ISSUE:
Contention: Wackwack claims that CFI erred in dismissing its interpleader complaint since there are conflicting claims for the certificate 201. There is no identity of parties,
of subject matter, and of cause of action between case 26044 and the interpleader action, so the complaint should not be dismissed based on res judicata.
HELD: Plaintiff cannot file interpleader once judgment is rendered against it.
Although res judicata was the ground availed of by respondents in their MtDs and upon which CFI dismissed the complaint, the determinative issue relates to the propriety
and timeliness of the remedy of interpleader.

1) The membership fee certificate 201 is proper for an interpleader suit. But a stakeholder should not await actual institution of independent suits against him before filing
for interpleader. He should not wait to be sued by either of the contending claimants. Otherwise, he may be barred by laches or undue delay.

Here, Wackwack was aware of the conflicting claims of respondents long before it filed this interpleader suit. It had been recognizing Tan as the lawful owner thereof. It was
sued by Lee who also claimed the same membership fee certificate. Yet it did not interplead Tan. It preferred to proceed with the litigation (civil case 26044) and to defend
itself therein. As a matter of fact, final judgment was rendered against it and said judgment has already been executed. It is now therefore too late for it to invoke the
remedy of interpleader.

A stakeholder’s action of interpleader is too late when filed after judgment has been rendered against him in favor of one of the contending claimants because once
judgment is obtained against him by one claimant, he becomes liable to the latter. If a stakeholder defends a suit filed by one of the claimants and allows said suit to
proceed to final judgment against him, he cannot later have that part of the litigation repeated in an interpleader suit.

Besides, a successful litigant cannot later be impleaded by his defeated adversary in an interpleader suit and compelled to prove his claim anew against other adverse
claimants as that would be a collateral attack upon the judgment.

8. RCBC v. Metro Container Corporation, GR 127913, September 13, 2001, Kapunan, J., First Division. (Judgment was rendered in an unlawful detainer case
against one party to the interpleader case in favor of the other party thereto while interpleader case was pending)
FACTS:
Ley Construction Corporation (LEYCON) contracted a loan from RCBC of P30M. This was secured by a REM over a property in Valenzuela City. LEYCON failed to pay.
RCBC foreclosed the mortgage with it as highest bidder. LEYCON filed an action to nullify EJ foreclosure sale against RCBC (Case 4037). RCBC later consolidated
ownership over the property due to failure of LEYCON to redeem it within 12 months. Thus, RCBC demanded rental payments from Metro Container Corporation
(METROCAN) which was leasing the property from LEYCON.

Unlawful detainer case- On May 26, 1994, LEYCON filed an action for unlawful detainer against METROCAN in MeTC (Case 6202). On Oct. 31, 1995, Judgment was
rendered which ordered METROCAN to pay LEYCON whatever rentals due on the property. This became final and executory.

Interpleader case- On May 27, 1994, METROCAN filed a complaint for interpleader (Case 4398) in RTC against LEYCON and RCBC to determine which among them
shall rightfully receive the rentals. LEYCON and METROCAN entered into an amicable settlement where METROCAN paid back rentals to LEYCON.

On Feb. 01, 1996, METROCAN moved to dismiss Case 4398 for becoming moot due to the amicable settlement and the final decision in Case 6202. These were denied by
RTC. CA reversed and ordered the dismissal of Case 4398. Hence this petition.

ISSUE:
Contention: RCBC alleges that the MeTC decision in Case 6202 does not render the interpleader action moot.
HELD:
The issue in Case 6202, UD case, is limited to the question of physical possession. The issue of ownership is immaterial. This was made clear when RTC denied RCBC’s
motion for inclusion as indispensable party because the determination of the issue of possession will not affect RCBC’s claims of ownership over the premises. The issue in
Case 6202 is limited to LEYCON’s breach of the provisions of the contract of lease.

Thus, the reason for the interpleader action ceased when MeTC rendered judgment in Case 6202 whereby the court directed METROCAN to pay LEYCON the rentals.
While RCBC, not being a party to Case 6202, could not be bound by the judgment therein, METROCAN is bound by the MeTC decision. When the decision in Case
6202 became final and executory, METROCAN had no alternative but to pay rentals to LEYCON.

An interpleader case requires that “conflicting claims upon the same subject matter are or may be made against the plaintiff-in-interpleader who claims no interest whatever in
the subject matter or an interest which in whole or in part is not disputed by the claimants." The decision in Case 6202 resolved the conflicting claims insofar as payment of
rentals was concerned.

RCBC is correct that it is not bound by the decision in Case 6202. But it could not compel METROCAN to pursue Case 4398. RCBC has other avenues to prove its
claim. It has other legal remedies. The issue of ownership can be threshed out in Case 4037, the case for nullification of EJ foreclosure sale filed by LEYCON against RCBC.

RULE 63- DECLARATORY RELIEF AND SIMILAR REMEDIES

9. Velarde v. Social Justice Society, GR 159357, April 28, 2004, Panganiban, J., En Banc. (Declaratory relief requires justiciable controversy- imminent violation of
right)
FACTS:
SJS, a political party, filed a petition for declaratory relief in RTC against petitioners, seeking the interpretation of several constitutional provisions, particularly on separation
of church and state; and a declaratory judgment on the constitutionality of the acts of religious leaders endorsing a candidate for an elective office, or urging or requiring the
members of their flock to vote for a specified candidate. Petitioners sought dismissal on the ground that the petition stated no cause of action and there is no justiciable
controversy. RTC denied all motions to dismiss.

The RTC ruled that it had jurisdiction since the petition raised only a question of law. It then discussed the issue of separation of church and state, even tracing the historical
background of the principle. But RTC failed to include a dispositive portion in its decision. It only opined at some point that the endorsement of specific candidates in election
violates the separation clause. Petitioners’ MRs were denied.

Hence this petition for review.

HELD:
Based on R63, S1, an action for declaratory relief should be filed by a person interested under a deed, a will, a contract or other written instrument, and whose rights are
affected by a statute, an executive order, a regulation or an ordinance. The purpose of the remedy is to interpret or to determine the validity of the written instrument and to
seek a judicial declaration of the parties' rights or duties thereunder. The essential requisites of the action are as follows: (1) there is a justiciable controversy; (2) the
controversy is between persons whose interests are adverse; (3) the party seeking the relief has a legal interest in the controversy; and (4) the issue is ripe for judicial
determination.

1) No justiciable controversy- A justiciable controversy refers to an existing case or controversy that is appropriate or ripe for judicial determination, not one that is
conjectural or merely anticipatory. The SJS petition failed to allege an existing controversy between SJS and petitioners (named respondents in the petition). SJS merely
speculated/anticipated without factual moorings that, as religious leaders, petitioners had endorsed or threatened to endorse candidates for elective offices and such
would violate the separation clause. Such premise is speculative and theoretical. There is no factual allegation that SJS’ rights are being subjected to any threatened,
imminent, and inevitable violation that should be prevented by the declaratory relief sought.

In other words, the SJS petition merely sought an opinion of RTC. SJS did not ask for a declaration of its rights and duties or pray for the stoppage of any threatened
violation of its declared right. Courts cannot issue an advisory opinion.

2) Contention: SJS claims that in a petition for declaratory relief, a cause of action need not be alleged or proven. There is no need for any violation of a right.
Held:
The failure to state a CoA is a ground for dismissal. But in special civil actions for declaratory relief, the concept of a CoA under ordinary civil actions does NOT
strictly apply. An action for declaratory relief presupposes that there has been no actual breach of the instruments involved. Nonetheless, a breach or violation should be
impending, imminent, or at least threatened.

SJS does not allege any legal right in its favor that it sought to protect. We can only infer interest from its bare allegation that it “has thousands of members who are citizens-
taxpayers-registered voters who are interested in a judicial clarification of the constitutionality of partisan participation of religious leaders in PH politics.” But this general
averment is insufficient. It is not personal and is vague, speculative, and uncertain. The rules require that the interest must be material to the issue and affected by the
questioned act or instrument, as distinguished from simple curiosity or incidental interest in the question raised.

3) No legal standing- Legal standing or locus standi has been defined as a personal and substantial interest in the case, such that the party has sustained or will sustain direct
injury as a result of the challenged act. Interest means a material interest in issue that is affected by the questioned act or instrument, as distinguished from a mere incidental
interest in the question involved. There was no showing in the petition that SJS or its members as registered voters would be adversely affected by the alleged acts of
petitioners if the issue was not resolved. The alleged interest of its “thousands of members who are citizens-taxpayers-registered voters” is too general.

While the constitutional issue is of transcendental importance and novel, SJS made no allegations or clarifications during the oral arguments that would supply the
deficiencies above discussed. Thus, the transcendental issue cannot be resolved anyway.

4) Proper proceedings in civil cases- Upon filing of the complaint/petition and payment of legal fees, the clerk of court shall issue summons. If the answer has a
counterclaim/crossclaim, it must be answered within 10d. A reply may be filed within 10d from service of the pleading responded to. There may be judgment on the
pleadings or summary judgment, or a motion to dismiss. After the last pleading has been served and filed, the case shall be set for pretrial. Thereafter, the case shall be set for
trial. Issues may be referred to a commission, who shall filed a written report on the matters referred to it after completion of proceedings before it. A judgment or final order
shall then be rendered.

Here, even a cursory perusal of SJS’ petition shows its gross inadequacy. It had no statement of ultimate facts and did not specify the relief it sought, but merely asked the
court to answer a hypothetical question. Relief refers to a specific coercive measure prayed for as a result of a violation of the rights of a plaintiff. Also, RTC denied the MtDs
of petitioners without hearing in violation of R16, S2. RTC issued its “decision” without allowing the parties to file their answers. Thus, there was no joinder of issues. RTC
also failed to notify OSG.

Proceedings for declaratory relief must still follow the process outlined in the Rules of Court.

(SC also ruled that RTC’s decision violated the constitutional requirement in Art. VIII, S14. SC also discussed the essential parts of a good decision.)

10. Tambunting v. Sps. Sumabat, GR 144101, September 16, 2005, Corona, J., Third Division. (Action for declaratory relief must be filed before breach)
FACTS:
A land in Caloocan City was registered in the names of respondents Sps. Sumabat. Respondents mortgaged it to petitioner Tambunting to secure a P7,727 loan. In August
1976, respondents were informed that their debt had ballooned to P15k for their failure to pay the monthly amortizations. In May 1977, since respondents defaulted in their
obligation, petitioner Commercial House of Finance, Inc. (CHFI), as assignee of the mortgage, initiated foreclosure proceedings but this did not push thru as it was restrained
by CFI in a complaint for injunction filed by respondents, which was subsequently dismissed (Case 6329).

Declaratory relief case- On March 16, 1979, respondents filed an action for declaratory relief with CFI, seeking declaration of the extent of their actual indebtedness. CHFI
was declared in default. CFI fixed respondent’s liability at P15,743 and authorized them to consign the amount to the court. Respondents consigned said amount on Jan. 09,
1981.

Nullification of foreclosure case- In March 1995, respondents received a notice of sheriff’s sale indicating that the mortgage had been foreclosed by CHFI on Feb. 08, 1995
and that an EJ sale was to be held on March 27, 1995. Respondents filed a petition for preliminary injunction, but the public auction proceeded and the property was sold to
CHFI as highest bidder. Respondents failed to redeem so ownership was consolidated in CHFI. Respondents thus amended their complaint to an action for nullification of
foreclosure and sale and consolidation of title.

RTC ruled that the CFI decision fixing liability at P15,743 had long become final and the mortgage was extinguished when respondents paid their debt by consigning the
amount in court. Thus, RTC nullified the foreclosure sale and the consolidation of title in CHFI’s name. Hence this petition.

HELD:
1) An action for declaratory relief should be filed by a person interested under a deed, will, contract or other written instrument, and whose rights are affected by a statute,
executive order, regulation or ordinance BEFORE breach or violation thereof. The purpose of the action is to secure an authoritative statement of the rights and obligations
of the parties under a statute, deed, contract, etc. for their guidance in its enforcement or compliance and not to settle issues arising from its alleged breach. Where the
law or contract has already been contravened prior to the filing of an action for declaratory relief, the court can no longer assume jurisdiction over the action. In other
words, a court has no more jurisdiction over an action for declaratory relief if its subject, i.e., the statute, deed, contract, etc., has already been infringed or transgressed before
the institution of the action. Under such circumstances, inasmuch as a cause of action has already accrued in favor of one or the other party, there is nothing more for the court
to explain or clarify short of a judgment or final order.

Here, an infraction of the mortgage terms had already taken place before the filing of the action for declaratory relief. Thus, CFI lacked jurisdiction and its decision is void.

2) Nonetheless, a mortgage action prescribes after 10 years. CHFI’s right of action accrued in May 1977 when respondents defaulted in their obligation to pay. The period
was interrupted when respondents filed the complaint for injunction of foreclosure in May 1977 (Case 6329) but commenced to run again on Nov. 09, 1977 when the case
was dismissed. Respondent’s filing of the action for declaratory relief in March 1979 did not interrupt the running of the 10y period since CFI had no jurisdiction over the
declaratory relief action. Thus, petitioners could enforce their right to the mortgage only until Nov. 07, 1987, the 10th year from the dismissal of Case 6329.

Thus, the foreclosure held on Feb. 08, 1995, 7 years too late, and the public auction on March 27, 1995, and the consolidation of title in CHFI’s favor, are all void.

11. Malana v. Tappa, GR 181303, September 17, 2009, Chico-Nazario, J., Third Division. (R63, S1, first vs second paragraphs; quieting title a real action)
FACTS:
Petitioners filed in RTC a complaint for reivindicacion, quieting of title, and damages against respondents. Petitioners alleged that they are the owners of a land in
Tuguegarao City, Cagayan. Petitioners inherited it from Anastacio who died intestate. During Anastacio’s lifetime, he had allowed Consuelo to build on and occupy the
southern portion of the property. Consuelo agreed to vacate at any time that Anastacio and his heirs might need it. Respondents, Consuelo’s family members, continued to
occupy the property even after her death, building their residences using permanent materials and were claiming ownership. Petitioners demanded respondents to vacate, but
they refused. In the barangay conciliation proceedings, respondents presented documents supporting their claim of ownership. Petitioners claim that these documents are
dubious and falsified, but since they created a cloud on petitioners’ title to the property, they were compelled to file in RTC the complaint to quiet title.

Before respondents could file an answer, RTC dismissed the complaint on the ground of lack of jurisdiction, referring to RA 7691, amending BP 129, that vests RTC with
jurisdiction over real actions where the assessed value of the property involved exceeds P20k, and the value of the property involved is less than P20k (P410 only).

ISSUE:
Contention: RTC should not have dismissed the petition since R63, S1 states that an action to quiet title falls under the jurisdiction of RTC. There is also no obstacle to their
joining 2 causes of action- quieting of title and reivindicacion- in a single complaint, and also, misjoinder of CoA is not a ground to dismiss.
HELD:
1) RTC correctly distinguished between the first and second paragraphs of R63, S1.

The first paragraph describes the general circumstances in which a person may file a petition for declaratory relief. As stated therein, a petition for declaratory relief under
the first paragraph may be brought before the RTC.

The second paragraph refers to reformation under Arts. 1359 to 1369, an action to quiet title authorized by Arts. 476 to 481, and an action to consolidate ownership required
by Art. 1607 of NCC in a sale with right to repurchase. These three are similar to declaratory relief since they also result in the adjudication of the legal rights of the
litigants without the need of execution to carry the judgment into effect. To determine which court has jurisdiction over these actions in the second paragraph of R63, S1,
said provision must be read together with BP 129.

R63, S1 does not require that an action to quiet title be filed in RTC. It repeatedly uses the word “may”- that an action for quieting of title “may be brought under this
Rule” and a person desiring to file a petition for declaratory relief “may xxx bring an action in the appropriate RTC.” “May” denotes that the provision is merely permissive.

1.1) In contrast, BP 129 as amended uses “shall” and requires MTC to exercise exclusive original jurisdiction over real actions where the assessed value does not exceed
P20k (BP 129, S33[3]).

Here, the assessed value is only P410. Thus, MTC has exclusive original jurisdiction. (*See case 12[1])

2) Before breach- Also, an action for declaratory relief may be entertained only before the breach or violation of the statute, deed, or contract to which it refers. A petition for
declaratory relief gives a practical remedy for ending controversies that have not reached the state where another relief is immediately available; and supplies the need for a
form of action that will set controversies at rest before they lead to a repudiation of obligations, an invasion of rights, and a commission of wrongs . A court has no more
jurisdiction over an action for declaratory relief if its subject has already been infringed before the filing of the action.

Here, petitioners’ complaint for quieting of title was filed after petitioners already demanded and respondents refused to vacate the property. The complaint was filed
after respondents’ express claim of ownership in the Lupong Tagapamayapa in direct challenge to petitioners’ title. Since petitioners averred in the complaint that they had
already been deprived of possession, the proper remedy is an accion publiciana or an accion reivindicatoria, not a case for declaratory relief.

Petitioners’ complaint contains sufficient allegations for an accion reivindicatoria. Jurisdicion over such action depends on the value of the property involved.

3) As to RTC’s dismissing petitioners’ complaint motu proprio, the court can do so if it has no jurisdiction over the nature of an action.

12. City of Lapu-Lapu v. PEZA, GR 184203, November 26, 2014, Leonen, J., Second Division.
FACTS:
PD 66 created the Export Processing Zone Authority (EPZA), declaring as government policy the establishment of export processing zones in strategic locations in the PH
etc. The EPZA was exempt from payment of RPT under PD 66, S21. In 1995, RA 7916, Special Economic Zone Act, created PH Economic Zone Authority (PEZA)
replacing EPZA.

In a letter dated March 25, 1998, the City of Lapu-Lapu, thru the office of the treasurer, demanded from PEZA P32,912,350 in RPT for 1992-1998 for PEZA’s properties
located in the Mactan Economic Zone, citing S193 and 234 of LGC withdrawing the RPT exemptions previously enjoyed by all persons and that there is no provision in RA
7916 exempting PEZA from RPT unlike PD 66, S21. In its last reminder, the city assessed PEZA P86M as RPT for 1992-2002.

PEZA filed a petition for declaratory relief in RTC Pasay praying that RTC declare it exempt from RPT. Pursuant to R63, S3, OSG filed a comment, agreeing that PEZA is
exempt from RPT under S24 and 51 of RA 7916. RTC granted PEZA’s petition and declared it exempt from RPT. Hence this petition.

Province of Bataan also demanded RPT from PEZA from June 1995 to December 2004. Bataan sent a notice of sale of real property for unpaid RPT. PEZA thus filed a
petition for injunction in RTC arguing that it is exempt from RPT. RTC denied PEZA’s petition for injunction, ruling that PEZA is not exempt from RPT. CA ruled that RTC
erred in dismissing PEZA’s petition, holding that PEZA, being an instrumentality of national government, cannot be taxed by LGUs. Hence this petition for review on
certiorari.

HELD:
1) The court with jurisdiction over petitioners for declaratory relief is RTC, the subject matter of litigation in an action for declaratory relief being incapable of
pecuniary estimation. Consistent with BP 129, S19, R63 states that a petition for declaratory relief is filed “in the appropriate RTC.”

2) Breach- A declaratory judgment may issue only if there has been no “breach of the documents in question.” If the contract or statute has already been breached, the
appropriate ordinary civil action must be filed. If adequate relief is available thru another action, the other action must be preferred over an action for declaratory relief.

In Ollada v. Central Bank, CB required CPAs to submit an accreditation under oath before they can certify financial statements to CB. CB disallowed Ollada’s financial
statements. Ollada filed a petition for declaratory relief against CB, claiming that the requirement restrained the legitimate pursuit of one’s trade. SC dismissed “without
prejudice to Ollada’s seeking relief in another appropriate action” because there was already a breach when CB refused to accept Ollada’s financial statements.

2.1) The parties to an action for declaratory relief must also be those whose rights or interests are affected by the contract or statute. There must be a justiciable controversy.
(SC cites Velarde v. SJS)

2.2) Here, PEZA erred in availing itself of a petition for declaratory relief against the City since it had already issued demand letters and RPT assessments against PEZA,
in violation of PEZA’s alleged tax-exempt status. RA 7916, the subject matter of PEZA’s petition for declaratory relief, had already been breached. Thus, RTC had no
jurisdiction over the petition for DR.

(SC discussed jurisdiction over subject matter, over the person, and over the res.) Here, RTC had no jurisdiction over the subject matter of the action, specifically over the
remedy sought.

3) Proper remedy- The proper remedy once an assessment is already issued depends on whether the assessment is erroneous or illegal.

An erroneous assessment presupposes that the taxpayer is subject to the tax but is disputing the correctness of the amount assessed. The taxpayer must first pay the RPT under
protest (LGC, S252). Then he may appeal to LBAA (S226), then to CBAA (S229).

An assessment is illegal if it was made without authority under the law. In such case, the taxpayer may directly resort to judicial action without paying under protest the
assessed tax and appealing to LBAA.

In Ty v. Trampe, when the municipal assessor, in assessing RPT, used a schedule of market values solely prepared by him, which schedule must be jointly prepared by the
provincial, city, and municipal assessors of municipalities within Metro Manila. SC ruled that the assessment was illegal. Ty had filed therein in RTC a petition to nullify the
assessment. SC held that since Ty raised the issue of legality of notice of assessment, an issue that did not go to the reasonableness of the amount assessed nor did it involve a
question of fact (Ty raised a question of law), there was no need to resort to administrative remedies under the LGC.

Here, PEZA did not avail itself of any of the remedies against notice of assessment. A petition for declaratory relief is not the proper remedy once a notice of assessment
was already issued. PEZA should have directly resorted to judicial action and filed a complaint for injunction, the “appropriate ordinary civil action,” to enjoin the
city from enforcing its assessment.

4) Wrong remedy, wrong court against Province of Bataan- As to PEZA’s petition for certiorari in the injunction case it filed against Province of Bataan, SC held that the
proper remedy was appeal since a R65 certiorari will not prosper if appeal is available. But SC treated the petition for certiorari as appeal since it was filed within the 15d
period to file appeal and it raised errors of judgments.

But PEZA’s petition should have been filed in CTA, not CA since CTA has jurisdiction over decisions of RTCs in local tax cases, which includes RPT cases since RPT is
found in LGC and is assessed by the local treasurer, under RA 1125 as amended by RA 9282, S7(a)(3). We have ruled that CTA, not CA, has exclusive original jurisdiction
over petitions for certiorari assailing interlocutory orders issued by RTCs in a local tax case. While CTA has no express grant of power to issue writs of certiorari under RA
1125 as amended, the tax court’s judicial power as defined in the constitution (Art. VIII, S1, “lower courts”) includes the power to determine whether there is gadalej on the
part of RTC in issuing an interlocutory order in cases falling within the exclusive appellate jurisdiction of the tax court.

The filing of appeal in the wrong court does not toll the period to appeal. Thus, the RTC denial of the petition for injunction became final and executory.

(SC nonetheless also held that PEZA is exempt from RPT.)

13. CJH Development Corporation v. BIR, GR 172457, December 24, 2008, Tinga, J., Second Division. (Court decision cannot be subject matter of declaratory
relief)
FACTS:
Proclamation 420 was issued by president Fidel Ramos creating a Special Economic Zone (SEZ) in a portion of Camp John Hay in Baguio City. S3 granted to the newly
created SEZ the same incentives already enjoyed by the Subic SEZ, including tax exemptions, both local and national. S3 was later declared unconstitutional by SC in John
Hay Peoples Alternative Coalition v. Lim, GR 119775. This decision attained finality when SC en banc denied the MR on March 29, 2005.

While the MR was pending, on January 16, 2004, the city treasurer of Baguio sent a demand letter to petitioner for P101M RPT. On May 26, 2005, BOC followed suit and
demanded of CJH P71M duties and taxes on importations from 1998-2004.

CJH filed a petition for declaratory relief in RTC questioning the retroactive application by BOC of the decision in GR 119775. RTC dismissed, ruling that declaratory relief
is not the appropriate remedy and that CA 55, which prohibits declaratory relief in cases where a taxpayer questions his tax liability, is still in force and effect. Hence this
petition.

HELD:
The requisites for a petition for declaratory relief to prosper are: (1) there must be a justiciable controversy; (2) the controversy must be between persons whose interests are
adverse; (3) the party seeking declaratory relief must have a legal interest in the controversy; and (4) the issue involved must be ripe for judicial determination.

1) Contention: CA 55 has been repealed by the Rules of Court. Thus, the remedy of declaratory relief against the BOC Assessment is proper.
Held:
But it was held in National Dental Supply Co. v. Meer that the “failure to incorporate CA 55 in (R63) is not due to an intent to repeal but rather to the desire to leave its
application to the sound discretion of the court xxx. And even if it is desired to incorporate it in (R63), it is doubted if it could be done under SC’s rule making power since
the nature of said proviso is substantive, its purpose being to lay down a policy as to the right of a taxpayer to contest collection of taxes” by BIR and BOC (the policy is to
prohibit the taxpayer from questioning his liability to BIR/BOC). Thus, as substantive law that has not yet been repealed, CA 55 is still in effect. SC cannot repeal or modify
an act of legislature.

2) Moreover, the proper subject matter of a declaratory relief is a deed, will, contract, or other written instrument, or the construction or validity of statute or ordinance. CJH
hinges its petition on the demand letter or assessment sent to it by the BOC. However, it is really not the demand letter which is the subject matter of the petition. Ultimately,
this Court is asked to determine whether the decision of the Court en banc in G.R. No. 119775 has a retroactive effect. This approach cannot be countenanced. A petition for
declaratory relief cannot properly have a court decision as its subject matter.

A court decision is not included within the purview of the words “other written instrument” since RoC already provides for the ways by which an ambiguous decision may be
corrected/clarified without need of resorting to R63. If it involves a decision of an appellate court, the party may file a MR or MNT. In case of ambiguity, a party may file a
motion for clarificatory judgment.

CJH can avail of the administrative and judicial remedies under the Tariff and Customs Code.

14. Ollada v. Central Bank of the PH, GR L-11357, May 31, 1962, Dizon, J., En Banc.
FACTS:
Ollada is a CPA authorized and accredited to practice accountancy in the office of the CB of PH. In December 1955, due to a requirement of the import export department of
CB that CPAs submit to an accreditation under oath before they could certify financial statements of their clients applying for import dollar allocations with its office,
Ollada’s previous accreditation was nullified. Thus, Ollada, with other CPAs, filed a petition for declaratory relief in CFI to nullify the accreditation requirement, alleging that
it was an invasion of the jurisdiction of the Board of Accountancy and it unlawfully restrained the legitimate pursuit of one’s trade.

CFI dismissed the complaint. Hence this petition.

HELD:
The petition alleged that “he suffered serious injury in that the requirement is an unlawful restraint of the free pursuit of petitioner’s profession as CPA” and that the petition
“has sufficiently stated facts to satisfy” the requisites for cause of action.

Petitioner commenced this action as one for Declaratory Relief. We have already held that the complaint for declaratory relief will not prosper if filed after a contract, statute
or right has been breached or violated. Here, such is precisely the situation arising from the facts alleged in the petition for declaratory relief. Respondent had already
invaded or violated petitioner’s right and caused him injury — all these giving him a complete cause of action enforceable in an appropriate ordinary civil action or
proceeding. The dismissal of the action was, therefore, proper. The rule is that an action for Declaratory Relief is proper only if adequate relief is not available through the
means of other existing forms of action or proceeding.

15. DILG v. Gatuz, GR 191176, October 14, 2015, Brion, J., Second Division. (Decisions of quasi-judicial bodies not subject to declaratory relief)
FACTS:
Gatuz was barangay captain of Barangay Tabang, Plaridel, Bulacan. Felicitas filed an administrative complaint before the ombudsman against him for abuse of authority and
dishonesty. He was penalized with 3 months suspension without pay. The deputy ombudsman indorsed its decision to the secretary of DILG for implementation. Respondent
moved for reconsideration.

DILG deferred implementation pending respondent’s MR. DILG also inquired as to SC’s ruling in Ombudsman v. Samaniego, where SC held that in administrative cases
where ombudsman imposes a penalty other than public censure or reprimand, suspension of not more than 1 month, or fine not equivalent to 1month salary, an appeal stays
execution of such decision.

Ombudsman denied MR. Respondent appealed his case to CA. As to the DILG inquiry, it cited its memorandum circular 1 s.2006 stating that the filing of MR or petitions for
review of ombudsman decisions does not stay implementation unless a TRO is in force. DILG, in a memorandum, thus directed DILG regional director to implement
respondent’s suspension.

Respondent filed a petition for declaratory relief with prayer for TRO in RTC, asking RTC to explain his rights pending resolution of his MR and to restrain DILG from
implementing his suspension, citing Samaniego. RTC prohibited the implementation of the suspension, citing Samaniego and that a MR is precursor to an appeal.

ISSUE:
Contention: Respondent cites Ombudsman v. Ibay and Marquez v. Ombudsman Desierto to support his argument that RTC has jurisdiction over actions for DR with
injunction against the ombudsman.
HELD: Court decisions, including a quasi-judicial decision, not subject to declaratory relief.
1) Marquez and Ibay both involved Lourdes Marquez, a bank manager, ordered by Ombudsman to produce bank documents in relation to bank accounts under investigation.
Faced with the dilemma of violating the Bank Secrecy Law, on one hand, and the threat of being cited in direct contempt by the Ombudsman on the other, Marquez filed a
petition for declaratory relief before the RTC. In both cases, we upheld the jurisdiction of the RTC over the action for declaratory relief and injunction. However, our rulings
in Marquez and Ibay only related to the investigatory power of the Ombudsman.

Here, the DILG Memorandum subject of his petition for DR was an implementation of the ombudsman’s decision. The memorandum was in the nature of a writ of
execution. Thus, the action for DR was against a quasi-judicial action of the ombudsman. Court orders and decisions cannot be the subject matter of DR and are not
within the purview of the words “other written instrument.” The same principle applies to orders, resolutions, and decision of quasi-judicial bodies. Parties cannot litigate
the same issue more than once.
2) Another reason is the doctrine of judicial stability or non-interference. Courts with equal authority cannot interfere with each other’s cases. Where the decisions of
administrative bodies are appealable to CA, these adjudicative bodies are co-equal with RTCs. Their actions are thus beyond the control of RTC. Ombudsman’s decisions in
disciplinary cases are appealable to CA via R43.

Also, the 2008 Samaniego has been reconsidered in SC’s resolution of Oct. 05, 2010. SC held en banc unanimously that decisions of the ombudsman in disciplinary cases are
immediately executory and cannot be stayed by appeal or injunctive writ.

16. PDIC v. CA, GR 126911, April 30, 2003, Carpio-Morales, J., Third Division. (Counterclaim may be filed in an action for DR since a special civil action is
governed by the rules on ordinary civil actions if not inconsistent with its special rules)
FACTS:
Prior to May 22, 1987, respondents Jose Abad et al. had 71 Golden Time Deposits of P1.1M. On May 22, 1987, a Friday, the Monetary Board of CB/BSP issued Resolution
505 prohibiting Manila Banking Corporation (MBC) to do business in PH and placing its assets under receivership. But this resolution was served on MBC only on May 26,
1987, Tuesday, when the receiver took over.

On May 25, 1987 (Monday), respondent Jose Abad was at MBC at 9am to preterminate the 71 GTDs and redeposit them into 28GTDs in P40k denominations under the
names of respondents. Of the 28 GTDs, 8 were preterminated. Respondents thereafter filed their claims with PDIC for payment of the 20 remaining insured GTDs.

PDIC paid 3 GTDs for P120k but withheld payment of 17 GTDs after the receiver of MBC-Iloilo submitted a report to PDIC that there was massive conversion of trust and
deposit accounts on May 25, 1987, stating that “it appears that the impending receivership of MBC was somehow already known to many depositors on account of the
massive withdrawals on May 25, 1987.”

Thus, PDIC filed a petition for declaratory relief against respondents in RTC to determine the insurability of respondents’ GTDs at MBC-Iloilo. Respondents set up a
counterclaim against PDIC for payment of the GTDs. RTC ruled that the GTDs are deposit liabilities, thus liabilities of PDIC as statutory insurer. CA affirmed. Hence this
petition.

HELD:
1) Contention: PDIC is liable only for deposits received by a bank “in the usual course of business.” Since bank transactions on May 25, 1987 were so massive and thus
irregular, these were not made “in the usual course of business” and thus PDIC is not liable for deposits subject thereof.”
Held:
Mere conjectures that MBC had actual knowledge of its impending closure do not suffice. The MB Resolution could not thus have nullified respondents’ transactions prior to
May 26, 1987. PDIC failed to overcome the presumption that the ordinary course of business was followed, thus the 28 GTDs were deposited “in the usual course of
business” of MBC.

2) Contention: PDIC argues that RTC erred in ordering it to pay the balance of the deposit insurance to respondents since a petition for DR does not entail an executory
process, and the only relief is a declaration of the parties’ rights and duties. An order of payment is beyond the office of DR proceedings.
Held:
Without doubt, a petition for declaratory relief does not essentially entail an executory process. There is nothing in its nature, however, that prohibits a counterclaim
from being set-up in the same action. A special civil action is not essentially different from an ordinary civil action, which is governed by Rules 1 to 56 of RoC, except that
the former deals with a special subject matter which makes necessary some special regulation. The same rules governing ordinary civil actions apply to special civil
actions if not inconsistent with or if they serve to supplement the provisions of the peculiar rules governing special civil actions. (**R1, S3(a) par.2)

17. Matalin Coconut Co., Inc. v. Municipal Council of Malabang, GR L-28138, August 13, 1986, Yap, J., First Division.
FACTS:
The municipal council of Malabang, Lanao del Sur, enacted Municipal Ordinance 45-46 which imposed a P0.30 police inspection fee per sack of cassava starch or flour
which shall be paid by the shipper before it is shipped outside the municipality. Petitioner challenged the validity of the ordinance in a petition for declaratory relief filed with
CFI. CFI ruled that the municipal ordinance is void and ordered respondent municipal treasurer to refund to petitioner payments made under the ordinance. Hence this
petition.

ISSUE:
Contention: Respondents claim that CFI erred in ordering the refund since in an action for DR, all the court can do is to construe the validity of the ordinance in question and
declare the rights of those affected thereby. Under R63, the court may convert the hearing into an ordinary action.
HELD:
We find no merit in such contention. Under Sec. 6 of Rule 63, the action for declaratory relief may be converted into an ordinary action and the parties allowed to file such
pleadings as may be necessary or proper, if before the final termination of the case "a breach or violation of an .. ordinance, should take place." Here, no breach or violation
of the ordinance occurred. The petitioner decided to pay "under protest" the fees imposed by the ordinance. Such payment did not affect the case; the declaratory relief
action was still proper because the applicability of the ordinance to future transactions still remained to be resolved, although the matter could also be threshed out in an
ordinary suit for the recovery of taxes paid. In its petition for declaratory relief, petitioner alleged that by reason of the enforcement of the municipal ordinance by
respondents, it was forced to pay under protest the fees imposed in the ordinance, and accordingly, one of the reliefs prayed for by the petitioner was that the respondents be
ordered to refund all the amounts it paid to respondent Municipal Treasurer during the pendency of the case. The inclusion of said allegation and prayer in the petition was not
objected to by the respondents in their answer. During the trial, evidence of the payments made by the petitioner was introduced. Respondents were thus fully aware of the
petitioner's claim for refund and of what would happen if the ordinance were to be declared invalid by the court.

Respondents’ contention would in effect require a separate suit to recover the fees paid by petitioner under protest. Multiplicity of suits should not be allowed or encouraged.

(SC also held that the ordinance was void since the only inspection done by the police was to verify the number of bags to be shipped out and they did not inspect the bags
itself since the policemen are not competent to determine if the cassava are fit for human consumption.)

18. DBM v. Manila’s Finest Retirees Association, Inc., GR 169466, May 09, 2007, Garcia, J., En Banc.
FACTS:
PD 765 established the Integrated National Police (INP) in 1975. In 1990, RA 6975 established the Philippine National Police (PNP). S23 thereof stated that PNP would
initially consist of INP members under PD 765. In 1998, RA 6975 was amended by RA 8551. Under RA 8551, PNP personnel stood to collect more retirement benefits than
what INP members of equivalent rank, who had retired under the INP Law, received. The disparity was P8-10k monthly pension.

Thus, respondents INP retirees, spearheaded by Manila’s Finest Retirees Association, Inc., filed a petition for declaratory relief against DBM, PNP, NAPOLCOM, CSC, and
GSIS, praying that declaratory judgment be rendered in their favor declaring that they, as INP retirees, are truly absorbed and equally considered PNP retirees and thus
entitled to the same retirement benefits under RA 8551.

RTC ruled that the respondents INP retirees are entitled to identical retirement benefits as PNP retirees. RTC also ordered the immediate implementation of proper adjustment
of respondents retirement benefits and release and pay to respondents the due payments of the amounts. CA affirmed. Hence this petition.

HELD:
1) SC held that INP was not abolished by RA 6975. The words “abolish” or “terminate” does not appear in RA 6975. What it provides for is the “absorption”, “transfer”, or
“merger” of INP. Thus, INP was merely transformed to PNP minus its military character. RA 8551, S38 states that the new retirement benefits shall “have retroactive effect
in favor of PNP members retired or separated from the time specified in the law.” This should apply to INP members retired prior to RA 6975 since INP was just absorbed in
PNP.
2) Contention: RTC cannot order immediate adjustment of retirement benefits since a petition for declaratory relief does not entail an executory process, the only relief being
a declaration of the parties’ rights and duties.
Held:
In PDIC v. CA (Case 16), SC held that a counterclaim can be filed in an action for declaratory relief since a special civil action is not essentially different from an ordinary
civil action, except that the former deals with a special subject matter which makes necessary some special regulation. The same rules governing ordinary civil actions apply
to special civil actions if not inconsistent with the special rules.

In Matalin Coconut v. Municipal Council of Malabang (Case 17), SC upheld the lower court’s order for a party to refund amounts paid by the adverse party under the
municipal ordinance therein questioned. We held that the inclusion of the prayer for refund was not objected to by respondents in their answer. Evidence of the payments was
introduced in trial. Respondents thus were aware of petitioner’s claim for refund and what would happen if the ordinance were to be declared invalid.

The Court sees no reason to treat this case differently from PDIC and Matalin. This disposition becomes all the more appropriate considering that the respondents, as
petitioners in the RTC, pleaded for the immediate adjustment of their retirement benefits which, significantly, the herein petitioners, as respondents in the same court, did not
object to. Being aware of said prayer, the petitioners then already knew the logical consequence if, as it turned out, a declaratory judgment is rendered in the respondents'
favor. RTC’s judgment forestalled multiplicity of suits.

19. Republic v. Batuigas, GR 183110, October 07, 2013, Del Castillo, J., Second Division. (No petition for judicial declaration of citizenship)
FACTS:
Azucena filed a petition for naturalization in RTC. OSG moved to dismiss, alleging that Azucena failed to allege that she is engaged in a lawful occupation or a known
lucrative trade. RTC denied the motion and set the hearing for reception of Azucena’s evidence. OSG did not appear on the day of hearing. Azucena was allowed to present
evidence ex parte.

Azucena was born in Malangas, Zamboanga del Sur, to Chinese parents. She never departed from PH since birth. She studied her primary, secondary, and tertiary education
in PH schools. She graduated with a degree in BS Education. She practiced her teaching profession for 9 years total. She married Santiago Batuigas, a natural-born Filipino
and had 5 children. All the children studied in PH public and private schools and are all professionals working abroad. As proof of income, she submitted joint annual tax
returns. She submitted PNP and NBI clearances to prove her lack of criminal record.

RTC granted the petition for naturalization. OSG, in a motion, argued that the exparte presentation of evidence violated CA 473, S10 requiring public hearing in
naturalization cases. RTC rejected the argument. CA dismissed OSG’s appeal and affirmed RTC. Hence this petition.

HELD:
1) Azucena’s application for derivative citizenship under CA 473, S15, allowing any woman who marries a Filipino citizen to be naturalized, was denied by DOJ. Thus, she
had to file a petition for judicial naturalization. Azucena is a teacher by profession until she had to quit her teaching job to assume her family duties to support her family. She
and her husband were able to raise 5 children, provide them with education, and all have become professionals and responsible citizens. This is proof enough of both husband
and wife’s lucrative trade.

That the OSG and provincial prosecutor’s office was duly notified, the proceedings complied with the public hearing requirement under CA 473.

2) We are not unmindful of precedents to the effect that there is no proceeding authorized by the law or by the Rules of Court, for the judicial declaration of the
citizenship of an individual. "Such judicial declaration of citizenship cannot even be decreed pursuant to an alternative prayer therefor in a naturalization proceeding."

This case however is not a Petition for judicial declaration of Philippine citizenship but rather a Petition for judicial naturalization under CA 473. In the first, the petitioner
believes he is a Filipino citizen and asks a court to declare or confirm his status as a Philippine citizen. In the second, the petitioner acknowledges he is an alien, and
seeks judicial approval to acquire the privilege of becoming a Philippine citizen based on requirements required under CA 473. Azucena has clearly proven, under strict
judicial scrutiny, that she is qualified for the grant of that privilege, and this Court will not stand in the way of making her a part of a truly Filipino family.

RULE 64- REVIEW OF JUDGMENTS AND FINAL ORDERS OR RESOLUTIONS OF THE COMELEC AND THE COA
20. Fortune Life Insurance Company, Inc. v. Commission on Audit, GR 213525, January 27, 2015, Bersamin, J., En Banc. (Fresh period rule inapplicable to Rule
64)
FACTS:
Respondent Provincial Government of Antique and petitioner Fortune executed a MOA concerning life insurance coverage of barangay secretaries, treasurers, and tanods, the
former obligating P4.393M for premium payment and submitting the corresponding disbursement voucher to COA for pre-audit. COA disallowed payment. Petitioner filed
its petition for money claim in COA. COA also denied, holding that under LGU, only municipal or city government have the power to secure group insurance coverage for
barangay workers.

Petitioner received a copy of the COA decision on Dec. 14, 2012. It filed its MR on January 14, 2013. COA denied the motion. The denial was received on July 14, 2014.
Petitioner filed its petition for certiorari on Aug. 12, 2014. This was dismissed for being filed late.

ISSUE:
Contention: Petitioner claims that it filed its certiorari within the reglementary period, following the fresh period rule enunciated in Neypes v. CA. R64 is akin to a petition for
review under R42, hence the fresh period rule applies to R64.
HELD: Fresh period rule inapplicable to R64.
1) R13, S13 on proof of service by registered mail requires affidavit of service and registry receipt. Petitioner only attached an affidavit of service and cut print-outs of what
appeared to be the registry receipt numbers of the registered matters, not the registry receipts themselves. The rule requires the registry receipts, not their reproductions.

2) There is no parity between R42 petition for review and R64 petition for certiorari.

As to nature of the procedures, R42 governs appeal from RTC in the exercise of its appellate jurisdiction. Such appeal is on a question of fact, of law, or of mixed fact and
law, and is given due course only upon prima facie showing that RTC committed an error of fact or law warranting reversal or modification of the challenged judgment/final
order. In contrast, R64 is similar to a petition for certiorari under R65 , and assails a judgment/final order of the COMELEC/COA. It The petition is designed to correct only
errors of jurisdiction, not errors of judgment. Questions of fact cannot be raised except to determine whether COMELEC/COA committed gadalej.

The reglementary period in R42 is 15d from receipt of the assailed decision/final order or from receipt of the denial of MR/MNT. In R64, the petition is filed within 30d from
notice of judgment/final order/resolution sought to be reviewed. The filing of MR/MNT interrupts the period. Thus, if the motion is denied, the aggrieved party may file the
petition within the remaining period which shall not be less than 5 days.

Here, the MR was filed on Jan. 14, 2013, 31d after receipt of COA’s assailed decision on Dec. 14, 2012. Pursuant to R64, S3, it had only 5 days left fron July 14, 2014,
receipt of denial of MR, or until July 19, 2014. But petitioner filed the petition on Aug. 13, 2014, 25 days too late.

21. Pormento v. Estrada, GR 191988, August 31, 2010, Corona, CJ., En Banc. (Certiorari under R64 does not stay execution of judgment/decision/resolution
questioned)
FACTS:
The petition asks whether respondent Joseph Ejercito Estrada is covered by the ban o nthe president from “any reelection” under Art. VII, S4: “The president shall not be
eligible for any reelection.” Estrada was elected president in the elections on May 11, 1998. He again sought the presidency in the general elections held on May 10, 2010.
Petitioner Pormento opposed respondent’s candidacy and filed a petition for disqualification. Comelec 2nd division denied his petition. Comelec en banc denied his MR.
HELD:
Petitioner filed the instant petition for certiorari under R65 in relation to R64 on May 7, 2010. However, under the Rules of Court, the filing of such petition would not stay
the execution of the judgment, final order or resolution of the COMELEC that is sought to be reviewed. Besides, petitioner did not even pray for the issuance of a temporary
restraining order or writ of preliminary injunction. Hence, private respondent was able to participate as a candidate for the position of President in the May 10, 2010 elections
where he garnered the second highest number of votes.

Respondent was not elected. Since the issue on the proper interpretation of the phrase “any reelection” will be premised on a person’s second election as president, there is no
case or controversy to be resolved in this case. Thus, one requisite for judicial review, existence of an actual case or controversy, is sorely lacking. An action is moot
when it no longer presents a justiciable controversy. Assuming an actual controversy prior to the proclamation of president who is elected in the May 10, 2010 elections, the
same is no longer true today. Any discussion of respondent’s “reelection” will simply by hypothetical. The petition was dismissed.