G.R. No.

L-6120 June 30, 1953

CIPRIANO P. PRIMICIAS, petitioner, vs. FELICISIMO OCAMPO, as Judge-at-large presiding over Branch C of the Court of
First Instance of Manila and EUGENIO ANGELES, as City Fiscal of Manila, representing the PEOPLE OF THE PHILIPPINES,
respondents.

BAUTISTA ANGELO, J.:

This is a petition which seeks to prohibit respondent Judge from proceeding with the trial of two criminal cases which
were then pending against petitioner without the assistance of assessors in accordance with the provisions of section 49
of Republic Act No. 409 in relation to section 154 of Act No. 190, and as an auxiliary remedy, to have a writ of
preliminary injunction issued so that the trial may be held pending until further orders of this court.

This petition was originally filed with the Court of Appeals, but was later certified to this court on the ground that the
main basis of the petition is section 49 of Republic Act No. 409, otherwise known as Revised Charter of the City of
Manila, approved on June 18, 1949, and respondents assail the constitutionality of said section in that it contravenes the
constitutional provision that the rules of court "shall be uniform for all courts of the same grade . . . .(Section 13, Article
VIII of the Constitution.).

Petitioner was charged before the Court of First Instance of Manila with two statutory offenses, namely, (1) with a
violation of Commonwealth Act No. 606, which was docketed as criminal case No. 18374, in that he knowingly chartered
a vessel of Philippine registry to an alien without the approval of the President of the Philippines and (2) with a violation
of section 129 in relation to section 2713 of the Revised Administrative Code, which was docketed as Criminal Case No.
18375, in that he failed to submit to the Collector of Customs the manifests and certain authenticated documents for
the vessel "Antarctic" and failed to obtain the necessary clearance from the Bureau of Customs prior to the departure of
said vessel for a foreign port.

On April 23, 1952, before the trial of said criminal cases, petitioner filed a motion praying that assessors be appointed to
assist the court in considering the questions of fact involved in said cases as authorized by section 49 of Republic Act No.
409, otherwise known as Revised Charter of the City of Manila, which provides that "the aid of assessors in the trial of
any civil or criminal action in the Municipal Court, or the Court of First Instance, within the City, may be invoked in the
manner provided in the Code of Civil Procedure." This motion was opposed by the City Fiscal who appeared for the
People of the Philippines.

On April 28, 1952, the court issued an order denying the motion holding in effect that with the promulgation of the
Rules of Court by the Supreme Court, which became effective on July 1, 1940, all rules concerning pleading, practice and
procedure in all courts of the Philippines previously existing were not only superseded but expressly repealed, that the
Supreme Court, having been vested with the rule-making power, expressly omitted the portions of the Code of Civil
Procedure regarding assessors in said Rules of Court, and that the reference to said statute by section 49 of Republic Act
No. 409 on the provisions regarding assessors should be deemed as a mere surplusage. Believing that this order is
erroneous, petitioner now comes to this court imputing abuse of discretion to the respondent Judge.

The issues now posed by petitioner are:.

I. The right of the petitioner to a trial with the aid of assessors is an absolute substantive right, and the duty of the court
to provide assessors is mandatory.
II. The right to trial with the aid of assessors, being a substantive right, cannot be impaired by this court in the exercise of
its rule-making power.
III. Section 154 of the Code of Civil Procedure and Section 2477 of the Old Charter of Manila, creating the right to trial
with the aid of assessors, are substantive law and were not repealed by Rules of Court.
IV. Granting without admitting that the provisions on assessors of the Code of Civil Procedure and the old Charter of
Manila were impliedly repealed, nevertheless, the same provisions were later reenacted by reference in section 49 of
the Revised Charter of Manila, which is now the source of the right to trial with the aid of assessors and which refers to
the Code of Civil Procedure merely to indicate the procedure for appointing assessors.
V. Section 49 of the Revised Charter of Manila is not invalid class legislation and does not violate the constitutional
provision that the rules of pleading, practice and procedure 'shall be uniform for all the courts of the same grade.
A brief summary of the historical background of the legislation regarding trial with the aid of assessors in the Philippines
may be of help in the determination of the issues posed by petitioner. The first provision which allowed trial with the aid
of assessors in civil cases in inferior courts and Courts of First Instance is contained in Act No. 190 of the Philippine
Commission, otherwise known as the Code of Civil Procedure, which took effect on October 1, 1901 (Sections 58-62;
154-161). Almost simultaneously, or on October 17, 1901, the trial with the aid of assessors both in civil and criminal
cases was allowed in the Manila courts upon the enactment of Act No. 267, amending Act No. 183, the original Charter
of Manila. In 1914, the trial by assessors was allowed in criminal cases in the courts of first instance in the provinces with
the enactment of Act No. 2369. And in 1915, Act No. 2520 was passed extending the same trial by assessors to the
courts of first instance and justice of the peace courts in the Department of Mindanao and Sulu.

In connection with the use of assessors in Manila, section 44 of Act No. 183, the original Charter of Manila, as amended
by section 13 of Act No. 267, was reenacted as section 2449 of the Administrative Code 1916, Act No. 2657. Section
2449 of the Administrative Code of 1916 became section 2477 of Act No. 2711, otherwise known as the Revised
Administrative Code of 1917. And section 2477 in turn became section 49 of the Republic Act No. 409, which is the
present Charter of the City of Manila. This section 49 is the law now invoked by petitioner in support of his claim to a
trial with the aid of assessors in the two criminal cases now pending against him. Its pertinent provisions are quoted
hereunder for ready reference:.

SEC. 49. Assessors in the courts in the city. — The aid of assessors in the trial of any civil or criminal action in the
municipal court, or the Court of First Instance, within the city, may be invoked in the manner provided in the Code of
Civil Procedure. It shall be the duty of the Municipal Board to prepare one list of the names of twenty-five residents of
the City best fitted by education, natural ability and reputation for probity to sit as assessors in the trial of actions in the
municipal court and a like list of persons to sit as assessors in the trial of the action in the Court of First Instance. The
Board may at any time strike any name from the list so prepared, by reason of the death, permanent disability, or
unfitness of the person named; and in case names are so stricken out, other names shall be added in their place, to be
selected as in this section provided. Parties desiring to avail themselves of the use of assessors in the municipal or Court
of First Instance shall proceed as provided for by law or rules of court; and the method of summoning assessors,
enforcing their attendance, excusing them from attendance, their compensation, oath duties and effect of dissent from
the opinion of the judges shall be as provided in those laws or rules.

A careful analysis of the above provisions is interesting. Their most salient features are: The aid of assessors in the trial
of any civil or criminal action in the Municipal Court or the Court of First Instance may be invoked in the manner
provided in the Code of Civil Procedure. The parties desiring to avail themselves of the use of assessors "shall proceed as
provided for by law or rules of court", and "the method of summoning assessors, enforcing their attendance, excusing
them from attendance, their compensation, oath, duties, and effect of the dissent from the opinion of the judge shall be
as provided in those laws or rules." If we are to be guided merely by these provisions, the right to trial with the aid of
assessor would seem to be beyond dispute. These provisions are simple and clear and appear to be mandatory. But
where the difficulty arises is in their relation or bearing on the directive of the Constitution which provides that "the
existing laws on pleading, practice, and procedure are hereby repealed as statutes, and are declared rules of courts
subject to the power of the Supreme Court to alter and modify the same." Pursuant to this rule-making power, the
Supreme Court promulgated the present Rules of Court, which became effective on July 1, 1940, but because it failed to
incorporate therein the provisions of the Code of Civil Procedure on assessors, respondents now contend that the right
to trial with the aid of assessors, with all its concomitant provisions, cannot now be invoked because, being procedural
in nature, the same must be deemed to have been impliedly eliminated.

This claim would be correct if we were to hold that the right to trial with the aid of assessors is not substantive but
procedural or adjective in nature. If it were merely procedural, not having been incorporated in the Rules of Court, the
logical conclusion is that the rule- making power has deemed wise to eliminate it. But no such presumption, nor
conclusion, can be drawn for the reason that the right to a trial by assessors is substantive in the sense that it must
created and defined by express enactment as opposed to a mere remedy devised to enforce such right or obtain redress
therefor. "Rules of procedure should be distinguished from substantive law. A substantive law creates, defines or
regulates rights concerning life, liberty or property, or the powers of agencies or instrumentalities for the administration
of public affairs, whereas rules of procedure are provisions prescribing the method by which substantive rights may be
enforced in courts of justice." (Moran, Comments on the Rules of Court, Vol. I, 1952 ed., p.4.)
In Bustos vs. Lucero,* (46 Off. Gaz., January Supp., pp. 445, 448), this Court cited with approval the following definitions
of substantive law:

Substantive law creates substantive rights and the two terms in this respect may be said to be synonymous. Substantive
rights in a term which includes those rights which one enjoys under the legal system prior to the disturbance of normal
relations. (60 C.J. 980.)

Substantive law is that part of the law which creates, defines and regulates rights, or which regulates the right and
duties which give rise to a cause of action; that part of the law which courts are established to administer; as opposed to
adjective or remedial law, which prescribes the method of enforcing rights or obtain redress for their invasions (36 C.J.
27; 52 C.J.S. 1026).

The trial with the aid of assessors as granted by section 154 of the Code of Civil Procedure and section 2477 of the old
Charter of Manila are parts of substantive law and as such are not embraced by the rule-making power of the Supreme
Court. This is so because in said section 154 this matter is referred to as a right given by law to a party litigant. Section
2477 of the Administrative Code of 1917 is couched is such a manner that a similar right is implied when invoked by a
party litigant. It says that the aid may be invoked in the manner provided in the Code of Civil Procedure. And this right
has been declared absolute and substantial by this Court in several cases where the aid of assessors had been invoked
(Berbari vs. Concepcion, et al., 40 Phil., 320; Colegio de San Jose vs. Sison, 54 Phil., 344.) Thus, it was there said that
these provisions "necessarily lead to the conclusion that the intervention of the assessors is not an empty formality
which may be disregarded without violating either the letter or the spirit of the law. It is another security given by the
law to the litigants, and as such, it is a substantial right of which they cannot be deprived without vitiating all the
proceedings. Were we to agree that for one reason or another the trial by assessors may be done away with, the same
line of reasoning would force us to admit that the parties litigant may be deprived of their right to be represented by
counsel, to appear and be present at the hearings, and so on, to the extent of omitting the trial in a civil case, and thus
set at naught the essential rights granted by the law to the parties, with consequent nullity of the proceedings." (Colegio
de San Jose vs. Sison, 54 Phil., 344, 349.)

Being substantive in nature, it is not difficult to see why the provisions concerning trial by assessors embodied in the
Code of Civil Procedure have not been incorporated by the Supreme Court in the present Rules of Court. To have done
so, it would have been a travesty of its rule-making power which, by direct mandate of the Constitution, is limited to
matters referring to pleading, practice and procedure. The application that the respondents draw from the failure to
incorporate these provisions in the present Rules of Court to the effect that the intention was to eliminate them or
repeal them all together cannot, therefore, stand in the light of the observations and authorities we have above
adverted to.

There is a point in the claim that the provisions concerning trial by assessors embodied in the Code of Civil Procedure are
not wholly substantive but portions thereof are remedial such as those which refer to the method of summoning
assessors, enforcing their attendance, excusing them from attendance, their compensation, oath, duties and effect of
dissent from the opinion of the judge, as to which no cogent reason is seen for their non-incorporation if the intent is
not to eliminate them from the Rules of Court. This is true; but it is likewise true that because said remedial provisions
are inextricably interwoven with the substantive part, it must have been deemed wise and proper to leave them as they
were for reasons of coordination and expediency, it being a truism that the one cannot be detached from the other. Ubi
jus ibi remedium. Remedial measures are but implementary in character and they must be appended to the portion of
the law to which they belong. Mention should be made here that not all of the provisions appearing in the Code of Civil
Procedure are remedial in nature, such as those pertaining to prescription, the requisites for making a will, and the
succession of the estate of an adopted child, which are admittedly substantive in character and for that reason were not
incorporated in the Rules of Court. To this group belong the provisions under consideration.

Granting arguendo that the provisions on assessors of the Code of Civil Procedure and even in the old Charter of Manila
are purely remedial in nature and because of the failure to incorporate them in the Rules of Court they are deemed to
have been impliedly repealed as claimed by respondents, we are of the opinion that they can still be invoked by a
litigant upon the theory that they had been reaffirmed and reenacted by Republic Act No. 409, which was approved in
1949, or nine years after the Rules of Court became effective. As already stated, section 49 of said Act states that the aid
of assessors may be invoked in the manner provided in the Code of Civil Procedure. It likewise states that the parties
desiring to avail themselves for the use of assessors shall proceed as provided for by law. The mention made of the Code
of Civil Procedure in said section indicates in itself a re-enactment or incorporation by reference of the provisions
concerning assessors contained in said law. Congress, whose members were mostly lawyers, must be presumed to know
that at the time said Act was approved the Rules of Court had already been promulgated without incorporating therein
the provisions concerning the aid to assessors, and fully cognizant of this situation, and not desiring to omit this right
granted to a litigant, they must have deemed it wise and proper to re-enact them by reference in said section 49. This
Congress can do, for, while our Constitution has given the power to adopt rules of procedure to the Supreme Court, such
grant did not preclude Congress from enacting any procedural law or altering, amending, or supplementing any of the
rules that may be promulgated by the Supreme Court (Section 13, Article VIII, Philippine Constitution).

The practice of making such reference has long been sanctioned. Our Congress did this not only in connection with
courts in the City of Manila. It also did it in connection with courts in Quezon City (Republic Act No. 537). Statutes which
refer to other statutes and make them applicable to the subject for legislation are called "reference statutes". These
statutes are frequently used "to avoid encumbering the statute books by unnecessary repetition, and they have
frequently been recognized as an approval method of legislation, in the absence of constitutional restrictions." [50 Am.
Jur. 57; Gruen vs. Tax Commission, 211 P. (2d) (1949) 651, 666.].

Again, it has been held that "The adoption of an earlier statute by reference makes it as much as a part of the latter act
as though it had been incorporated at full length. This is true of a legislative act which refers to another act for the
procedure to be taken." (50 Am. Jur. 58.) The reference in Republic Act No. 409 to the provisions on assessors must be
deemed, therefore, to have incorporated therein the pertinent provisions on the matter contained in the Code of Civil
Procedure in much the same manner as if the whole provisions had been reproduced. Consistent with this theory, we
cannot but hold that the observations made by respondents to the effect that the reference made to said provisions is
section 49 is a mere surplusage, or was due to a mere oversight, has no legal basis, as such innuendo would be
tantamount to imputing lack of foresight, if not brazen negligence, to our legislative body.

It is finally contended that section 49 of Republic Act No. 409 is unconstitutional because it violates the constitutional
provisions that procedural rules "shall be uniform for all courts of the same grade" and, therefore, it is a class legislation.
This contention cannot be entertained: firstly, because it is raised for the first time in this instance, a procedural defect
which would bar any further discussion on the matter following well-known precedents1 and, secondly, because it is not
correct that at present only in Manila trial with the aid of assessors may be invoked if we will sustain the theory that the
promulgation of the Rules of Court did not have the effect of repealing the provisions on assessors embodied in the
Code of Civil Procedure.

The contention of respondents — we reckon — is predicated on the assumption that the provisions on assessors of the
Code of Civil Procedure had been impliedly repealed. Such is not the case. We have already pointed out that the basic
provisions on the matter partake of the nature of substantive law and as such they were left intact by the Supreme
Court. The corollary to this conclusion is that this remedy may be invoked out only in Manila but in all other places
where it existed prior to the promulgation of the Rules of Court. This is true in civil cases. With regard to criminal cases,
we have already said that the same remedy may be invoked in the cities of Cebu, Iloilo and Quezon, with the
particularity that their charters make express reference, either directly or indirectly, to the provisions of the code of Civil
Procedure. With this historical background, the claim that under the theory we have entertained the trial with the aid of
assessors can only be invoked in the City of Manila is certainly without merit.

In view of the foregoing, we hold that the provisions on assessors embodied in the Code of Civil Procedure are still in
force and that the same may still be invoked in the light of the provisions of section 49 of the Republic Act No. 409. It is
therefore our opinion that the respondent Judge acted with abuse of discretion in denying petitioner his right to the aid
of assessors in the trial of the two criminal cases now pending in the Court of First Instance of Manila.

Wherefore, petition is hereby granted, without pronouncement as to costs.

-----
G.R. No. 165922
BAGUIO MARKET VENDORS MULTI-PURPOSE COOPERATIVE (BAMARVEMPCO), represented by RECTO INSO,
Operations Manager, Petitioner, vs. HON. ILUMINADA CABATO-CORTES, Executive Judge, Regional Trial Court, Baguio
City, Respondent.
DECISION
CARPIO, J.:
The Case
For review1 are the Orders2 of the Executive Judge of the Regional Trial Court of Baguio City finding petitioner Baguio
Market Vendors Multi-Purpose Cooperative liable for payment of foreclosure fees.

The Facts
Petitioner Baguio Market Vendors Multi-Purpose Cooperative (petitioner) is a credit cooperative organized under
Republic Act No. 6938 (RA 6938), or the Cooperative Code of the Philippines.3 Article 62(6) of RA 6938 exempts
cooperatives:
from the payment of all court and sheriff's fees payable to the Philippine Government for and in connection with all
actions brought under this Code, or where such action is brought by the Cooperative Development Authority before the
court, to enforce the payment of obligations contracted in favor of the cooperative.4

In 2004, petitioner, as mortgagee, filed with the Clerk of Court of the Regional Trial Court of Baguio City (trial court) a
petition to extrajudicially foreclose a mortgage under Act 3135, as amended.5 Under Section 7(c) of Rule 141, as
amended,6 petitions for extrajudicial foreclosure are subject to legal fees based on the value of the mortgagee’s claim.
Invoking Article 62 (6) of RA 6938, petitioner sought exemption from payment of the fees.

The Ruling of the Trial Court

In an Order dated 30 August 2004, Judge Iluminada Cabato-Cortes (respondent), Executive Judge of the trial court,
denied the request for exemption, citing Section 22 of Rule 141 of the Rules of Court, as amended, exempting from the
Rule’s coverage only the "Republic of the Philippines, its agencies and instrumentalities" and certain suits of local
government units.7

Petitioner sought reconsideration but respondent denied its motion in the Order dated 6 October 2004. This time,
respondent reasoned that petitioner’s reliance on Article 62(6) of RA 6938 is misplaced because the fees collected under
Rule 141 are not "fees payable to the Philippine Government" as they do not accrue to the National Treasury but to a
special fund8 under the Court’s control.9
Hence, this petition.

Petitioner maintains that the case calls for nothing more than a simple application of Article 62(6) of RA 6938.

The Office of the Solicitor General (OSG), in its Manifestation (in lieu of Comment), joins causes with petitioner. The OSG
submits that as the substantive rule, Article 62(6) of RA 6938 prevails over Section 22 of Rule 141, a judicial rule of
procedure. The OSG also takes issue with respondent’s finding that the legal fees collected under Rule 141 are not "fees
payable to the Philippine Government" as the judiciary forms part of the Philippine government, as defined under the
Revised Administrative Code.10

Although not a party to this suit, we required the Court’s Office of the Chief Attorney (OCAT) to comment on the petition,
involving as it does, issues relating to the Court’s power to promulgate judicial rules. In its compliance, the OCAT
recommends the denial of the petition, opining that Section 22, Rule 141, as amended, prevails over Article 62(6) of RA
6938 because (1) the power to impose judicial fees is eminently judicial and (2) the 1987 Constitution insulated the
Court’s rule-making powers from Congress’ interference by omitting in the 1987 Constitution the provision in the 1973
Constitution allowing Congress to alter judicial rules. The OCAT called attention to the Court’s previous denial of a
request by a cooperative group for the issuance of "guidelines" to implement cooperatives’ fees exemption under
Article 62(6) of RA 6938.11 Lastly, the OCAT recommends the amendment of Section 22, Rule 141 to make explicit the
non-exemption of cooperatives from the payment of legal fees.

The Issue
The question is whether petitioner’s application for extrajudicial foreclosure is exempt from legal fees under Article 62(6)
of RA 6938.
The Ruling of the Court
We hold that Article 62(6) of RA 6938 does not apply to petitioner’s foreclosure proceeding.

Petitions for Extrajudicial Foreclosure

Outside of the Ambit of Article 62(6) of RA 6938

The scope of the legal fees exemption Article 62(6) of RA 6938 grants to cooperatives is limited to two types of actions,
namely: (1) actions brought under RA 6938; and (2) actions brought by the Cooperative Development Authority to
enforce the payment of obligations contracted in favor of cooperatives. By simple deduction, it is immediately apparent
that Article 62(6) of RA 6938 is no authority for petitioner to claim exemption from the payment of legal fees in this
proceeding because first, the fees imposable on petitioner do not pertain to an action brought under RA 6938 but to a
petition for extrajudicial foreclosure of mortgage under Act 3135. Second, petitioner is not the Cooperative
Development Authority which can claim exemption only in actions to enforce payments of obligations on behalf of
cooperatives.

The Power of the Legislature

vis a vis the Power of the Supreme Court to Enact Judicial Rules

Our holding above suffices to dispose of this petition. However, the Court En Banc has recently ruled in Re: Petition for
Recognition of the Exemption of the Government Service Insurance System from Payment of Legal Fees12 on the issue
of legislative exemptions from court fees. We take the opportunity to reiterate our En Banc ruling in GSIS.

Until the 1987 Constitution took effect, our two previous constitutions textualized a power sharing scheme between the
legislature and this Court in the enactment of judicial rules. Thus, both the 193513 and the 197314 Constitutions vested
on the Supreme Court the "power to promulgate rules concerning pleading, practice, and procedure in all courts, and
the admission to the practice of law." However, these constitutions also granted to the legislature the concurrent power
to "repeal, alter or supplement" such rules.15

The 1987 Constitution textually altered the power-sharing scheme under the previous charters by deleting in Section 5(5)
of Article VIII Congress’ subsidiary and corrective power.16 This glaring and fundamental omission led the Court to
observe in Echegaray v. Secretary of Justice17 that this Court’s power to promulgate judicial rules "is no longer shared
by this Court with Congress":

The 1987 Constitution molded an even stronger and more independent judiciary. Among others, it enhanced the rule
making power of this Court [under] Section 5(5), Article VIII18 x x x .

The rule making power of this Court was expanded. This Court for the first time was given the power to promulgate
rules concerning the protection and enforcement of constitutional rights. The Court was also granted for the first time
the power to disapprove rules of procedure of special courts and quasi-judicial bodies. But most importantly, the 1987
Constitution took away the power of Congress to repeal, alter, or supplement rules concerning pleading, practice and
procedure. In fine, the power to promulgate rules of pleading, practice and procedure is no longer shared by this Court
with Congress, more so with the Executive. x x x x (Italicization in the original; boldfacing supplied)

Any lingering doubt on the import of the textual evolution of Section 5(5) should be put to rest with our recent En Banc
ruling denying a request by the Government Service Insurance System (GSIS) for exemption from payment of legal fees
based on Section 39 of its Charter, Republic Act No. 8291, exempting GSIS from "all taxes, assessments, fees, charges or
dues of all kinds."19 Reaffirming Echegaray’s construction of Section 5(5), the Court described its exclusive power to
promulgate rules on pleading, practice and procedure as "one of the safeguards of this Court’s institutional
independence":

[T]he payment of legal fees is a vital component of the rules promulgated by this Court concerning pleading, practice
and procedure, it cannot be validly annulled, changed or modified by Congress. As one of the safeguards of this Court’s
institutional independence, the power to promulgate rules of pleading, practice and procedure is now the Court’s
exclusive domain.20 x x x (Emphasis supplied)

WHEREFORE, we DENY the petition. We AFFIRM the Orders dated 30 August 2004 and 6 October 2004 of the Executive
Judge of the Regional Trial Court of Baguio City.
Let a copy of this Decision be furnished the Office of the Court Administrator for circulation to all courts.
SO ORDERED
------
A.M. No. 08-2-01-0 February 11, 2010
RE: PETITION FOR RECOGNITION OF THE EXEMPTION OF THE GOVERNMENT SERVICE INSURANCE SYSTEM FROM
PAYMENT OF LEGAL FEES. GOVERNMENT SERVICE INSURANCE SYSTEM, Petitioner.
RESOLUTION

CORONA, J.:
May the legislature exempt the Government Service Insurance System (GSIS) from legal fees imposed by the Court on
government-owned and controlled corporations and local government units? This is the central issue in this
administrative matter.

The GSIS seeks exemption from the payment of legal fees imposed on government-owned or controlled corporations
under Section 22,1 Rule 141 (Legal Fees) of the Rules of Court. The said provision states:

SEC. 22. Government exempt. – The Republic of the Philippines, its agencies and instrumentalities are exempt from
paying the legal fees provided in this Rule. Local government corporations and government-owned or controlled
corporations with or without independent charter are not exempt from paying such fees.

However, all court actions, criminal or civil, instituted at the instance of the provincial, city or municipal treasurer or
assessor under Sec. 280 of the Local Government Code of 1991 shall be exempt from the payment of court and sheriff’s
fees. (emphasis supplied)

The GSIS anchors its petition on Section 39 of its charter, RA2 8291 (The GSIS Act of 1997):

SEC. 39. Exemption from Tax, Legal Process and Lien. – It is hereby declared to be the policy of the State that the
actuarial solvency of the funds of the GSIS shall be preserved and maintained at all times and that contribution rates
necessary to sustain the benefits under this Act shall be kept as low as possible in order not to burden the members of
the GSIS and their employers. Taxes imposed on the GSIS tend to impair the actuarial solvency of its funds and increase
the contribution rate necessary to sustain the benefits of this Act. Accordingly, notwithstanding any laws to the contrary,
the GSIS, its assets, revenues including accruals thereto, and benefits paid, shall be exempt from all taxes, assessments,
fees, charges or duties of all kinds. These exemptions shall continue unless expressly and specifically revoked and any
assessment against the GSIS as of the approval of this Act are hereby considered paid.Consequently, all laws, ordinances,
regulations, issuances, opinions or jurisprudence contrary to or in derogation of this provision are hereby deemed
repealed, superseded and rendered ineffective and without legal force and effect.

Moreover, these exemptions shall not be affected by subsequent laws to the contrary unless this section is expressly,
specifically and categorically revoked or repealed by law and a provision is enacted to substitute or replace the
exemption referred to herein as an essential factor to maintain and protect the solvency of the fund, notwithstanding
and independently of the guaranty of the national government to secure such solvency or liability.

The funds and/or the properties referred to herein as well as the benefits, sums or monies corresponding to the benefits
under this Act shall be exempt from attachment, garnishment, execution, levy or other processes issued by the courts,
quasi-judicial agencies or administrative bodies including Commission on Audit (COA) disallowances and from all
financial obligations of the members, including his pecuniary accountability arising from or caused or occasioned by his
exercise or performance of his official functions or duties, or incurred relative to or in connection with his position or
work except when his monetary liability, contractual or otherwise, is in favour of the GSIS. (emphasis supplied)

The GSIS then avers that courts still assess and collect legal fees in actions and proceedings instituted by the GSIS
notwithstanding its exemption from taxes, assessments, fees, charges, or duties of all kinds under Section 39. For this
reason, the GSIS urges this Court to recognize its exemption from payment of legal fees.

According to the GSIS, the purpose of its exemption is to preserve and maintain the actuarial solvency of its funds and to
keep the contribution rates necessary to sustain the benefits provided by RA 8291 as low as possible. Like the terms
"taxes," "assessments," "charges," and "duties," the term "fees" is used in the law in its generic and ordinary sense as
any form of government imposition. The word "fees," defined as "charge[s] fixed by law for services of public officers or
for the use of a privilege under control of government," is qualified by the phrase "of all kinds."3 Hence, it includes the
legal fees prescribed by this Court under Rule 141. Moreover, no distinction should be made based on the kind of fees
imposed on the GSIS or the GSIS’ ability to pay because the law itself does not distinguish based on those matters.

The GSIS argues that its exemption from the payment of legal fees would not mean that RA 8291 is superior to the Rules
of Court. It would merely show "deference" by the Court to the legislature as a co-equal branch.4 This deference will
recognize the "compelling and overriding" State interest in the preservation of the actuarial solvency of the GSIS for the
benefit of its members.5

The GSIS further contends that the right of government workers to social security is an aspect of social justice. The right
to social security is also guaranteed under Article 22 of the Universal Declaration of Human Rights and Article 9 of the
International Covenant on Economic, Social and Cultural Rights. The Court has the power to promulgate rules concerning
the protection and enforcement of constitutional rights, including the right to social security, but the GSIS is not
compelling the Court to promulgate such rules. The GSIS is merely asking the Court to recognize and allow the exercise
of the right of the GSIS "to seek relief from the courts of justice sans payment of legal fees."6

Required to comment on the GSIS’ petition,7 the Office of the Solicitor General (OSG) maintains that the petition should
be denied.8 According to the OSG, the issue of the GSIS’ exemption from legal fees has been resolved by the issuance by
then Court Administrator Presbitero J. Velasco, Jr.9 of OCA10 Circular No. 93-2004:

TO : ALL JUDGES, CLERKS OF COURT AND COURT PERSONNEL OF THE METROPOLITAN TRIAL COURTS, MUNICIPAL TRIAL
COURTS IN CITIES, MUNICIPAL TRIAL COURTS, MUNICIPAL CIRCUIT TRIAL COURTS, SHARI’A CIRCUIT COURTS

SUBJECT : REMINDER ON THE STRICT OBSERVANCE OF ADMINISTRATIVE CIRCULAR NO. 3-98 (Re: Payment of Docket and
Filing Fees in Extra-Judicial Foreclosure); SECTION 21, RULE 141 OF THE RULES OF COURT; SECTION 3 OF PRESIDENTIAL
DECREE NO. 385; and ADMINISTRATIVE CIRCULAR NO. 07-99 (Re: Exercise of Utmost Caution, Prudence, and
Judiciousness in Issuance of Temporary Restraining Orders and Writs of Preliminary Injunctions)

Pursuant to the Resolution of the Third Division of the Supreme Court dated 05 April 2004 and to give notice to the
concern raised by the [GSIS] to expedite extrajudicial foreclosure cases filed in court, we wish to remind all concerned
[of] the pertinent provisions of Administrative Circular No. 3-98, to wit:

2. No written request/petition for extrajudicial foreclosure of mortgages, real or chattel, shall be acted upon by the Clerk
of Court, as Ex-Officio Sheriff, without the corresponding filing fee having been paid and the receipt thereof attached to
the request/petition as provided for in Sec. 7(c), of Rule 141 of the Rules of Court.

3. No certificate of sale shall be issued in favor of the highest bidder until all fees provided for in the aforementioned
sections and paragraph 3 of Section 9 (I) of Rule 141 of the Rules of Court shall have been paid.The sheriff shall attach to
the records of the case a certified copy of the Official Receipt [O.R.] of the payment of the fees and shall note the O.R.
number in the duplicate of the Certificate of Sale attached to the records of the case.

Moreover, to settle any queries as to the status of exemption from payment of docket and legal fees of government
entities, Section 21, Rule 141 of the Rules of Court explicitly provides:
SEC. 21. Government exempt. – The Republic of the Philippines, its agencies and instrumentalities are exempt from
paying the legal fees provided in this Rule. Local governments and government-owned or controlled corporations with
or without independent charters are not exempt from paying such fees.11
xxx xxx xxx
The OSG contends that there is nothing in Section 39 of RA 8291 that exempts the GSIS from fees imposed by the Court
in connection with judicial proceedings. The exemption of the GSIS from "taxes, assessments, fees, charges or duties of
all kinds" is necessarily confined to those that do not involve pleading, practice and procedure. Rule 141 has been
promulgated by the Court pursuant to its exclusive rule-making power under Section 5(5), Article VIII of the Constitution.
Thus, it may not be amended or repealed by Congress.

On this Court’s order,12 the Office of the Chief Attorney (OCAT) submitted a report and recommendation13 on the
petition of the GSIS and the comment of the OSG thereon. According to the OCAT, the claim of the GSIS for exemption
from the payment of legal fees has no legal basis. Read in its proper and full context, Section 39 intends to preserve the
actuarial solvency of GSIS funds by exempting the GSIS from government impositions through taxes. Legal fees imposed
under Rule 141 are not taxes.

The OCAT further posits that the GSIS could not have been exempted by Congress from the payment of legal fees.
Otherwise, Congress would have encroached on the rule-making power of this Court.

According to the OCAT, this is the second time that the GSIS is seeking exemption from paying legal fees.14 The OCAT
also points out that there are other government-owned or controlled corporations and local government units which
asked for exemption from paying legal fees citing provisions in their respective charters that are similar to Section 39 of
RA 8291.15 Thus, the OCAT recommends that the petition of GSIS be denied and the issue be settled once and for all for
the guidance of the concerned parties.

Faced with the differing opinions of the GSIS, the OSG and the OCAT, we now proceed to probe into the heart of this
matter: may Congress exempt the GSIS from the payment of legal fees? No.

The GSIS urges the Court to show deference to Congress by recognizing the exemption of the GSIS under Section 39 of
RA 8291 from legal fees imposed under Rule 141. Effectively, the GSIS wants this Court to recognize a power of Congress
to repeal, amend or modify a rule of procedure promulgated by the Court. However, the Constitution and jurisprudence
do not sanction such view.

Rule 141 (on Legal Fees) of the Rules of Court was promulgated by this Court in the exercise of its rule-making powers
under Section 5(5), Article VIII of the Constitution:
Sec. 5. The Supreme Court shall have the following powers:
xxx xxx xxx
(5) Promulgate rules concerning the protection and enforcement of constitutional rights, pleading, practice, and
procedure in all courts, the admission to the practice of law, the Integrated Bar, and legal assistance to the
underprivileged. Such rules shall provide a simplified and inexpensive procedure for the speedy disposition of cases,
shall be uniform for all courts of the same grade, and shall not diminish, increase, or modify substantive rights. Rules of
procedure of special courts and quasi-judicial bodies shall remain effective unless disapproved by the Supreme Court.
xxx xxx x x x (emphasis supplied)

The power to promulgate rules concerning pleading, practice and procedure in all courts is a traditional power of this
Court.16 It necessarily includes the power to address all questions arising from or connected to the implementation of
the said rules.

The Rules of Court was promulgated in the exercise of the Court’s rule-making power. It is essentially procedural in
nature as it does not create, diminish, increase or modify substantive rights. Corollarily, Rule 141 is basically procedural.
It does not create or take away a right but simply operates as a means to implement an existing right. In particular, it
functions to regulate the procedure of exercising a right of action and enforcing a cause of action.17 In particular, it
pertains to the procedural requirement of paying the prescribed legal fees in the filing of a pleading or any application
that initiates an action or proceeding.18

Clearly, therefore, the payment of legal fees under Rule 141 of the Rules of Court is an integral part of the rules
promulgated by this Court pursuant to its rule-making power under Section 5(5), Article VIII of the Constitution. In
particular, it is part of the rules concerning pleading, practice and procedure in courts. Indeed, payment of legal (or
docket) fees is a jurisdictional requirement.19 It is not simply the filing of the complaint or appropriate initiatory
pleading but the payment of the prescribed docket fee that vests a trial court with jurisdiction over the subject-matter
or nature of the action.20 Appellate docket and other lawful fees are required to be paid within the same period for
taking an appeal.21 Payment of docket fees in full within the prescribed period is mandatory for the perfection of an
appeal.22 Without such payment, the appellate court does not acquire jurisdiction over the subject matter of the action
and the decision sought to be appealed from becomes final and executory.23

An interesting aspect of legal fees is that which relates to indigent or pauper litigants. In proper cases, courts may waive
the collection of legal fees. This, the Court has allowed in Section 21, Rule 3 and Section 19, Rule 141 of the Rules of
Court in recognition of the right of access to justice by the poor under Section 11, Article III of the Constitution.24
Mindful that the rule with respect to indigent litigants should not be ironclad as it touches on the right of access to
justice by the poor,25 the Court acknowledged the exemption from legal fees of indigent clients of the Public Attorney’s
Office under Section 16-D of the Administrative Code of 1987, as amended by RA 9406.26 This was not an abdication by
the Court of its rule-making power but simply a recognition of the limits of that power. In particular, it reflected a keen
awareness that, in the exercise of its rule-making power, the Court may not dilute or defeat the right of access to justice
of indigent litigants.

The GSIS cannot successfully invoke the right to social security of government employees in support of its petition. It is a
corporate entity whose personality is separate and distinct from that of its individual members. The rights of its
members are not its rights; its rights, powers and functions pertain to it solely and are not shared by its members. Its
capacity to sue and bring actions under Section 41(g) of RA 8291, the specific power which involves the exemption that
it claims in this case, pertains to it and not to its members. Indeed, even the GSIS acknowledges that, in claiming
exemption from the payment of legal fees, it is not asking that rules be made to enforce the right to social security of its
members but that the Court recognize the alleged right of the GSIS "to seek relief from the courts of justice sans
payment of legal fees."27

However, the alleged right of the GSIS does not exist. The payment of legal fees does not take away the capacity of the
GSIS to sue. It simply operates as a means by which that capacity may be implemented.

Since the payment of legal fees is a vital component of the rules promulgated by this Court concerning pleading, practice
and procedure, it cannot be validly annulled, changed or modified by Congress. As one of the safeguards of this Court’s
institutional independence, the power to promulgate rules of pleading, practice and procedure is now the Court’s
exclusive domain. That power is no longer shared by this Court with Congress, much less with the Executive.28

Speaking for the Court, then Associate Justice (now Chief Justice) Reynato S. Puno traced the history of the rule-making
power of this Court and highlighted its evolution and development in Echegaray v. Secretary of Justice:291avvphi1

Under the 1935 Constitution, the power of this Court to promulgate rules concerning pleading, practice and procedure
was granted but it appeared to be co-existent with legislative power for it was subject to the power of Congress to
repeal, alter or supplement. Thus, its Section 13, Article VIII provides:

Sec. 13. The Supreme Court shall have the power to promulgate rules concerning pleading, practice and procedure in all
courts, and the admission to the practice of law. Said rules shall be uniform for all courts of the same grade and shall not
diminish, increase, or modify substantive rights. The existing laws on pleading, practice and procedure are hereby
repealed as statutes, and are declared Rules of Court, subject to the power of the Supreme Court to alter and modify the
same. The Congress shall have the power to repeal, alter or supplement the rules concerning pleading, practice and
procedure, and the admission to the practice of law in the Philippines.

The said power of Congress, however, is not as absolute as it may appear on its surface. In In re Cunanan, Congress in
the exercise of its power to amend rules of the Supreme Court regarding admission to the practice of law, enacted the
Bar Flunkers Act of 1953 which considered as a passing grade, the average of 70% in the bar examinations after July 4,
1946 up to August 1951 and 71% in the 1952 bar examinations. This Court struck down the law as unconstitutional. In
his ponencia, Mr. Justice Diokno held that "x x x the disputed law is not a legislation; it is a judgment - a judgment
promulgated by this Court during the aforecited years affecting the bar candidates concerned; and although this Court
certainly can revoke these judgments even now, for justifiable reasons, it is no less certain that only this Court, and not
the legislative nor executive department, that may do so. Any attempt on the part of these departments would be a
clear usurpation of its function, as is the case with the law in question." The venerable jurist further ruled: "It is obvious,
therefore, that the ultimate power to grant license for the practice of law belongs exclusively to this Court, and the law
passed by Congress on the matter is of permissive character, or as other authorities say, merely to fix the minimum
conditions for the license." By its ruling, this Court qualified the absolutist tone of the power of Congress to "repeal, alter
or supplement the rules concerning pleading, practice and procedure, and the admission to the practice of law in the
Philippines.

The ruling of this Court in In re Cunanan was not changed by the 1973 Constitution. For the 1973 Constitution reiterated
the power of this Court "to promulgate rules concerning pleading, practice and procedure in all courts, x x x which,
however, may be repealed, altered or supplemented by the Batasang Pambansa x x x." More completely, Section 5(2)5
of its Article X provided:
xxx xxx xxx
Sec. 5. The Supreme Court shall have the following powers.
xxx xxx xxx
(5) Promulgate rules concerning pleading, practice, and procedure in all courts, the admission to the practice of law, and
the integration of the Bar, which, however, may be repealed, altered, or supplemented by the Batasang Pambansa. Such
rules shall provide a simplified and inexpensive procedure for the speedy disposition of cases, shall be uniform for all
courts of the same grade, and shall not diminish, increase, or modify substantive rights.

Well worth noting is that the 1973 Constitution further strengthened the independence of the judiciary by giving to it
the additional power to promulgate rules governing the integration of the Bar.

The 1987 Constitution molded an even stronger and more independent judiciary. Among others, it enhanced the rule
making power of this Court. Its Section 5(5), Article VIII provides:
xxx xxx xxx
Section 5. The Supreme Court shall have the following powers:
xxx xxx xxx
(5) Promulgate rules concerning the protection and enforcement of constitutional rights, pleading, practice and
procedure in all courts, the admission to the practice of law, the Integrated Bar, and legal assistance to the
underprivileged. Such rules shall provide a simplified and inexpensive procedure for the speedy disposition of cases,
shall be uniform for all courts of the same grade, and shall not diminish, increase, or modify substantive rights. Rules of
procedure of special courts and quasi-judicial bodies shall remain effective unless disapproved by the Supreme Court.

The rule making power of this Court was expanded. This Court for the first time was given the power to promulgate
rules concerning the protection and enforcement of constitutional rights. The Court was also granted for the first time
the power to disapprove rules of procedure of special courts and quasi-judicial bodies. But most importantly, the 1987
Constitution took away the power of Congress to repeal, alter, or supplement rules concerning pleading, practice and
procedure. In fine, the power to promulgate rules of pleading, practice and procedure is no longer shared by this Court
with Congress, more so with the Executive.

The separation of powers among the three co-equal branches of our government has erected an impregnable wall that
keeps the power to promulgate rules of pleading, practice and procedure within the sole province of this Court. The
other branches trespass upon this prerogative if they enact laws or issue orders that effectively repeal, alter or modify
any of the procedural rules promulgated by this Court. Viewed from this perspective, the claim of a legislative grant of
exemption from the payment of legal fees under Section 39 of RA 8291 necessarily fails.

Congress could not have carved out an exemption for the GSIS from the payment of legal fees without transgressing
another equally important institutional safeguard of the Court’s independence — fiscal autonomy.30 Fiscal autonomy
recognizes the power and authority of the Court to levy, assess and collect fees,31 including legal fees. Moreover, legal
fees under Rule 141 have two basic components, the Judiciary Development Fund (JDF) and the Special Allowance for
the Judiciary Fund (SAJF).32 The laws which established the JDF and the SAJF33 expressly declare the identical purpose
of these funds to "guarantee the independence of the Judiciary as mandated by the Constitution and public policy."34
Legal fees therefore do not only constitute a vital source of the Court’s financial resources but also comprise an essential
element of the Court’s fiscal independence. Any exemption from the payment of legal fees granted by Congress to
government-owned or controlled corporations and local government units will necessarily reduce the JDF and the SAJF.
Undoubtedly, such situation is constitutionally infirm for it impairs the Court’s guaranteed fiscal autonomy and erodes
its independence.

WHEREFORE, the petition of the Government Service Insurance System for recognition of its exemption from the
payment of legal fees imposed under Section 22 of Rule 141 of the Rules of Court on government-owned or controlled
corporations and local government units is hereby DENIED.

The Office of the Court Administrator is hereby directed to promptly issue a circular to inform all courts in the
Philippines of the import of this resolution.
SO ORDERED
-----
G.R. No. 143275 March 20, 2003
LAND BANK OF THE PHILIPPINES, petitioner, vs. ARLENE DE LEON and BERNARDO DE LEON, respondents.
RESOLUTION
CORONA, J.:

Before us are the motion for reconsideration dated October 16, 2002 and supplement to the motion for reconsideration
dated November 11, 2002 filed by movant-petitioner Land Bank of the Philippines (LBP, for brevity) seeking a reversal of
this Court’s Decision1 dated September 10, 2002 which denied LBP’s petition for review.

Herein respondent spouses Arlene and Bernardo de Leon filed a petition to fix the just compensation of a parcel of land2
before the Regional Trial Court of Tarlac, Branch 63, acting as a Special Agrarian Court. On December 19, 1997, the
agrarian court rendered summary judgment fixing the compensation of the subject property as follows: (1) P1,260,000
for the 16.69 hectares of riceland and (2) P2,957,250 for the 30.4160 hectares of sugarland.

The Department of Agrarian Reform (DAR, for brevity) and LBP both filed separate appeals using different modes. DAR
filed a petition for review while LBP interposed an ordinary appeal by filing a notice of appeal. DAR’s petition for review3
was assigned to the Special Third Division of the Court of Appeals while LBP’s ordinary appeal4 was assigned to the
Fourth Division of the same court.

On November 6, 1998, the appellate court’s Special Third Division rendered a decision in the petition for review filed by
DAR, the dispositive portion of which reads:

WHEREFORE, premises considered, the petition for review is GIVEN DUE COURSE. The decision dated February 9, 1998 is
partially reconsidered. The trial court is ordered to recompute the compensation based on the selling price of palay at
213.00 per cavan. Petitioner is ordered to pay legal interest at 6% of the compensation so fixed from 1990 until full
payment is made by the government.5

Meanwhile, on February 15, 2000, the appellate court’s Fourth Division dismissed LBP’s ordinary appeal primarily
holding that LBP availed of the wrong mode of appeal.6 LBP filed a motion for reconsideration but the same was denied.

On July 14, 2000, LBP filed before this Court a petition for review of the decision of the Court of Appeals. On September
10, 2002, this Court rendered a Decision, the dispositive portion of which reads:
WHEREFORE, the appealed RESOLUTIONS, dated February 15, 2000 and May 22, 2000, respectively, of the Court of
Appeals are hereby AFFIRMED. No costs.
SO ORDERED.7

In affirming the dismissal by the appellate court of LBP’s ordinary appeal, this Court held that Section 608 of RA 6657
(The Comprehensive Agrarian Reform Law) is clear in providing petition for review as the appropriate mode of appeal
from decisions of Special Agrarian Courts. Section 619 (the provision on which LBP bases its argument that ordinary
appeal is the correct mode of appeal from decisions of Special Agrarian Courts) merely makes a general reference to the
Rules of Court and does not categorically prescribe ordinary appeal as the correct way of questioning decisions of
Special Agrarian Courts. Thus, we interpreted Section 61 to mean that the specific rules for petitions for review in the
Rules of Court and other relevant procedures of appeals shall be followed in appealed decisions of Special Agrarian
Courts.

We likewise held that Section 60 of RA 6657 is constitutional and does not violate this Court’s power to "promulgate
rules concerning the protection and enforcement of constitutional rights, pleadings, practice and procedure in all courts,
the admission to the practice of law, the Integrated Bar and legal assistance to the underprivileged."10 We ruled that
the Rules of Court does not categorically prescribe ordinary appeal as the exclusive mode of appeal from decisions of
Special Agrarian Courts. The reference by Section 61 to the Rules of Court in fact even supports the mode of a petition
for review as the appropriate way to appeal decisions of the Special Agrarian Courts. Furthermore, the same Section 5(5),
Article VIII of the 1987 Philippine Constitution quoted by LBP states that "rules of procedure of special courts and quasi-
judicial bodies shall remain effective unless disapproved by the Supreme Court." Since Section 60 is a special procedure
and this Court has not yet provided for a particular process for appeals from decisions of agrarian courts, the said
section does not encroach on our rule-making power.
Hence, LBP filed the instant motion for reconsideration and supplement to the motion for reconsideration reiterating its
claim in the petition for review that Section 60 of RA 6657 is unconstitutional. LBP still maintains that a legislative act like
Section 60 infringes on the exclusive rule-making power of this Court in violation of the 1987 Philippine Constitution.

In the event that said argument is again rejected, LBP pleads that the subject Decision should at least be given
prospective application considering that more than 60 similar agrarian cases filed by LBP via ordinary appeal before the
Court of Appeals are in danger of being dismissed outright on technical grounds on account of our ruling herein. This,
according to LBP, will wreak financial havoc not only on LBP as the financial intermediary of the Comprehensive Agrarian
Reform Program but also on the national treasury and the already depressed economic condition of our country.11 Thus,
in the interest of fair play, equity and justice, LBP stresses the need for the rules to be relaxed so as to give substantial
consideration to the appealed cases.

On the first ground, we find it needless to re-discuss the reasons already propounded in our September 10, 2002
Decision explaining why Section 60 of RA 6657 does not encroach on our constitutional rule-making power.

Be that as it may, we deem it necessary to clarify our Decision’s application to and effect on LBP’s pending cases filed as
ordinary appeals before the Court of Appeals. It must first be stressed that the instant case poses a novel issue; our
Decision herein will be a landmark ruling on the proper way to appeal decisions of Special Agrarian Courts. Before this
case reached us, LBP had no authoritative guideline on how to appeal decisions of Special Agrarian Courts considering
the seemingly conflicting provisions of Section 60 and 61 of RA 6657.

More importantly, the Court of Appeals has rendered conflicting decisions on this precise issue. On the strength of Land
Bank of the Philippines vs. Hon. Feliciano Buenaventura, penned by Associate Justice Salvador Valdez, Jr. of the Court of
Appeals, certain decisions12 of the appellate court held that an ordinary appeal is the proper mode. On the other hand,
a decision13 of the same court, penned by Associate Justice Romeo Brawner and subject of the instant review, held that
the proper mode of appeal is a petition for review. In another case,14 the Court of Appeals also entertained an appeal
by the DAR filed as a petition for review.

On account of the absence of jurisprudence interpreting Sections 60 and 61 of RA 6657 regarding the proper way to
appeal decisions of Special Agrarian Courts as well as the conflicting decisions of the Court of Appeals thereon, LBP
cannot be blamed for availing of the wrong mode. Based on its own interpretation and reliance on the Buenaventura
ruling, LBP acted on the mistaken belief that an ordinary appeal is the appropriate manner to question decisions of
Special Agrarian Courts.

Hence, in the light of the aforementioned circumstances, we find it proper to emphasize the prospective application of
our Decision dated September 10, 2002. A prospective application of our Decision is not only grounded on equity and
fair play but also based on the constitutional tenet that rules of procedure shall not impair substantive rights.

In accordance with our constitutional power to review rules of procedure of special courts,15 our Decision in the instant
case actually lays down a rule of procedure, specifically, a rule on the proper mode of appeal from decisions of Special
Agrarian Courts. Under Section 5 (5), Article VIII of the 1987 Philippine Constitution, rules of procedure shall not diminish,
increase or modify substantive rights. In determining whether a rule of procedure affects substantive rights, the test is
laid down in Fabian vs. Desierto,16 which provides that:

[I]n determining whether a rule prescribed by the Supreme Court, for the practice and procedure of the lower courts,
abridges, enlarges, or modifies any substantive right, the test is whether the rule really regulates procedure, that is, the
judicial process for enforcing rights and duties recognized by substantive law and for justly administering remedy and
redress for a disregard or infraction of them. If the rule takes away a vested right, it is not procedural. If the rule creates
a right such as the right to appeal, it may be classified as a substantive matter; but if it operates as a means of
implementing an existing right then the rule deals merely with procedure. (italics supplied)

We hold that our Decision, declaring a petition for review as the proper mode of appeal from judgments of Special
Agrarian Courts, is a rule of procedure which affects substantive rights. If our ruling is given retroactive application, it will
prejudice LBP’s right to appeal because pending appeals in the Court of Appeals will be dismissed outright on mere
technicality thereby sacrificing the substantial merits thereof. It would be unjust to apply a new doctrine to a pending
case involving a party who already invoked a contrary view and who acted in good faith thereon prior to the issuance of
said doctrine.

In the 1992 case of Spouses Benzonan vs. Court of Appeals,17 respondent Pe, whose land was foreclosed by
Development Bank of the Philippines in 1977 and subsequently sold to petitioners Benzonan in 1979, tried to invoke a
1988 Supreme Court ruling counting the five-year period to repurchase from the expiration (in 1978) of the one-year
period to redeem the foreclosed property. Said 1988 ruling reversed the 1957 and 1984 doctrines which counted the
five-year period to repurchase from the date of conveyance of foreclosure sale (in 1977). Using the 1988 ruling,
respondent Pe claimed that his action to repurchase in 1983 had not yet prescribed.

However, this Court refused to apply the 1988 ruling and instead held that the 1957 and 1984 doctrines (the prevailing
ruling when Pe filed the case in 1983) should govern. The 1988 ruling should not retroact to and benefit Pe’s 1983 case
to repurchase. Thus, the action had indeed prescribed. This Court justified the prospective application of the 1988 ruling
as follows:

We sustain the petitioners' position. It is undisputed that the subject lot was mortgaged to DBP on February 24, 1970. It
was acquired by DBP as the highest bidder at a foreclosure sale on June 18, 1977, and then sold to the petitioners on
September 29, 1979.

At that time, the prevailing jurisprudence interpreting section 119 of R.A. 141 as amended was that enunciated in
Monge and Tupas cited above. The petitioners Benzonan and respondent Pe and the DBP are bound by these decisions
for pursuant to Article 8 of the Civil Code "judicial decisions applying or interpreting the laws or the Constitution shall
form a part of the legal system of the Philippines." But while our decisions form part of the law of the land, they are also
subject to Article 4 of the Civil Code which provides that "laws shall have no retroactive effect unless the contrary is
provided." This is expressed in the familiar legal maxim lex prospicit, non respicit, the law looks forward not backward.
The rationale against retroactivity is easy to perceive. The retroactive application of a law usually divests rights that have
already become vested or impairs the obligations of contract and hence, is unconstitutional (Francisco v. Certeza, 3 SCRA
565 [1961]).

The same consideration underlies our rulings giving only prospective effect to decisions enunciating new doctrines.
xxx xxx xxx
The buyers in good faith from DBP had a right to rely on our rulings in Monge and Tupas when they purchased the
property from DBP in 1979 or thirteen (13) years ago. Under the rulings in these two cases, the period to repurchase the
disputed lot given to respondent Pe expired on June 18, 1982. He failed to exercise his right. His lost right cannot be
revived by relying on the 1988 case of Belisario. The right of petitioners over the subject lot had already become vested
as of that time and cannot be impaired by the retroactive application of the Belisario ruling.18 (emphasis supplied)

WHEREFORE, the motion for reconsideration dated October 16, 2002 and the supplement to the motion for
reconsideration dated November 11, 2002 are PARTIALLY GRANTED. While we clarify that the Decision of this Court
dated September 10, 2002 stands, our ruling therein that a petition for review is the correct mode of appeal from
decisions of Special Agrarian Courts shall apply only to cases appealed after the finality of this Resolution.
SO ORDERED.
-----
DOMINADOR B. BUSTOS, petitioner, vs. ANTONIO G. LUCERO, Judge of First Instance of Pampanga, respondent.
TUASON, J.:

The petitioner herein, an accused in a criminal case, filed a motion with the Court of First Instance of Pampanga after he
had been bound over to that court for trial, praying that the record of the case be remanded to the justice of the peace
court of Masantol, the court of origin, in order that the petitioner might cross-examine the complainant and her
witnesses in connection with their testimony, on the strength of which warrant was issued for the arrest of the accused.
The motion was denied and that denial is the subject matter of this proceeding.

According to the memorandum submitted by the petitioner's attorney to the Court of First Instance in support of his
motion, the accused, assisted by counsel, appeared at the preliminary investigation. In that investigation, the justice of
the peace informed him of the charges and asked him if he pleaded guilty or not guilty, upon which he entered the plea
of not guilty. "Then his counsel moved that the complainant present her evidence so that she and her witnesses could
be examined and cross-examined in the manner and form provided by law." The fiscal and the private prosecutor
objected, invoking section 11 of rule 108, and the objection was sustained. "In view thereof, the accused's counsel
announced his intention to renounce his right to present evidence," and the justice of the peace forwarded the case to
the court of first instance.

Leaving aside the question whether the accused, after renouncing his right to present evidence, and by reason of that
waiver he was committed to the corresponding court for trial, is estopped, we are of the opinion that the respondent
judge did not act in excess of his jurisdiction or in abuse of discretion in refusing to grant the accused's motion to return
the record for the purpose set out therein. In Dequito and Saling Buhay vs. Arellano, G.R. No. L-1336, recently
promulgated, in which case the respondent justice of the peace had allowed the accused, over the complaint's objection,
to recall the complainant and her witnesses at the preliminary investigation so that they might be cross-examined, we
sustained the justice of the peace's order. We said that section 11 of Rule 108 does not curtail the sound discretion of
the justice of the peace on the matter. We said that "while section 11 of Rule 108 defines the bounds of the defendant's
right in the preliminary investigation, there is nothing in it or any other law restricting the authority, inherent in a court
of justice, to pursue a course of action reasonably calculated to bring out the truth."

But we made it clear that the "defendant can not, as a matter of right, compel the complaint and his witnesses to repeat
in his presence what they had said at the preliminary examination before the issuance of the order of arrest." We called
attention to the fact that "the constitutional right of an accused to be confronted by the witnesses against him does not
apply to preliminary hearings' nor will the absence of a preliminary examination be an infringement of his right to
confront witnesses." As a matter of fact, preliminary investigation may be done away with entirely without infringing the
constitutional right of an accused under the due process clause to a fair trial.

The foregoing decision was rendered by a divided court. The minority went farther than the majority and denied even
any discretion on the part of the justice of the peace or judge holding the preliminary investigation to compel the
complainant and his witnesses to testify anew.

Upon the foregoing considerations, the present petition is dismissed with costs against the petitioner.
Moran, C.J., Paras, Pablo, Bengzon, and Briones, JJ., concur.

RESOLUTION
March 8, 1949
TUASON, J.:

This cause is now before us on a motion for reconsideration.

In the decision sought to be reconsidered, we said, citing Dequito and Saling Buhay vs. Arellano, G.R. No. L-1336: "The
constitutional right of an accused to be confronted by the witnesses against him does not apply to preliminary hearings;
nor will the absence of a preliminary examination be an infringement of his right to confront witness. As a matter of fact,
preliminary investigation may be done away with entirely without infringing the constitutional right of an accused under
the due process clause to a fair trial." We took this ruling to be ample enough to dispose the constitutional question
pleaded in the application for certiorari. Heeding the wishes of the petitioner, we shall enlarge upon the subject.

It is contended that section 11 of Rule 108 of the Rules of Court 1 infringes section 13, Article VIII, of the Constitution. 2
It is said that the rule in question deals with substantive matters and impairs substantive rights.

We can not agree with this view. We are of the opinion that section 11 of Rule 108, like its predecessors, is an adjective
law and not a substantive law or substantive right. Substantive law creates substantive rights and the two terms in this
respect may be said to be synonymous. Substantive rights is a term which includes those rights which one enjoys under
the legal system prior to the disturbance of normal relations. (60 C.J., 980.) Substantive law is that part of the law which
creates, defines and regulates rights, or which regulates the rights and duties which give rise to a cause of action; that
part of the law which courts are established to administer; as opposed to adjective or remedial law, which prescribes the
method of enforcing rights or obtains redress for their invasion. (36 C. J., 27; 52 C. J. S., 1026.)

As applied to criminal law, substantive law is that which declares what acts are crimes and prescribes the punishment
for committing them, as distinguished from the procedural law which provides or regulates the steps by which one who
commits a crime is to be punished. (22 C. J. S., 49.) Preliminary investigation is eminently and essentially remedial; it is
the first step taken in a criminal prosecution.

As a rule of evidence, section 11 of Rule 108 is also procedural. Evidence — which is the "the mode and manner of
proving the competent facts and circumstances on which a party relies to establish the fact in dispute in judicial
proceedings" — is identified with and forms part of the method by which, in private law, rights are enforced and redress
obtained, and, in criminal law, a law transgressor is punished. Criminal procedure refers to pleading, evidence and
practice. (State vs. Capaci, 154 So., 419; 179 La., 462.) the entire rules of evidence have been incorporated into the Rules
of Court. We can not tear down section 11 of Rule 108 on constitutional grounds without throwing out the whole code
of evidence embodied in these Rules.

In Beazell vs. Ohio, 269 U. S., 167, 70 Law. ed., 216, the United States Supreme Court said:

Expressions are to be found in earlier judicial opinions to the effect that the constitutional limitation may be
transgressed by alterations in the rules of evidence or procedure. See Calder vs. Bull, 3 Dall. 386, 390, 1 L. ed., 648, 650;
Cummings vs. Missouri, 4 Wall. 277, 326, 18 L. ed., 356, 364; Kring vs. Missouri, 107 U. S. 221, 228, 232, 27 L. ed., 507,
508, 510, 2 Ct. Rep., 443. And there may be procedural changes which operate to deny to the accused a defense
available under the laws in force at the time of the commission of his offense, or which otherwise affect him in such a
harsh and arbitrary manner as to fall within the constitutional prohibition. Kring vs. Missouri, 107 U. S., 221, 27 L. ed.,
507, 2 Sup. Ct. Rep., 443; Thompson vs. Utah, 170 U. S., 343, 42 L. ed., 1061, 18 Sup. Ct. Rep., 620. But it is not well
settled that statutory changes in the mode of trial or the rules of evidence, which do not deprive the accused of a
defense and which operate only in a limited and unsubstantial manner to his disadvantage, are not prohibited. A statute
which, after indictment, enlarges the class of persons who may be witnesses at the trial, by removing the disqualification
of persons convicted of felony, is not an ex post facto law. Hopt vs. Utah, 110 U. S., 575, 28 L. ed., 263, 4 Sup. Ct. Rep.,
202, 4 Am. Crim. Rep. 417. Nor is a statute which changes the rules of evidence after the indictment so as to render
admissible against the accused evidence previously held inadmissible, Thompson vs. Missouri, 171 U. S., 380, 43 L. ed.,
204, 18 Sup. Ct. Rep., 922; or which changes the place of trial, Gut. vs. Minnesota, 9 Wall. 35, 19 L. ed., 573; or which
abolishes a court for hearing criminal appeals, creating a new one in its stead. See Duncan vs. Missouri, 152 U. S., 377,
382, 38 L. ed., 485, 487, 14 sup. Ct. Rep., 570.

Tested by this standard, we do not believe that the curtailment of the right of an accused in a preliminary investigation
to cross-examine the witnesses who had given evidence for his arrest is of such importance as to offend against the
constitutional inhibition. As we have said in the beginning, preliminary investigation is not an essential part of due
process of law. It may be suppressed entirely, and if this may be done, mere restriction of the privilege formerly enjoyed
thereunder can not be held to fall within the constitutional prohibition.

While section 11 of Rule 108 denies to the defendant the right to cross-examine witnesses in a preliminary investigation,
his right to present his witnesses remains unaffected, and his constitutional right to be informed of the charges against
him both at such investigation and at the trial is unchanged. In the latter stage of the proceedings, the only stage where
the guaranty of due process comes into play, he still enjoys to the full extent the right to be confronted by and to cross-
examine the witnesses against him. The degree of importance of a preliminary investigation to an accused may be
gauged by the fact that this formality is frequently waived.

The distinction between "remedy" and "substantive right" is incapable of exact definition. The difference is somewhat a
question of degree. (Dexter vs. Edmands, 89 F., 467; Beazell vs. Ohio, supra.) It is difficult to draw a line in any particular
case beyond which legislative power over remedy and procedure can pass without touching upon the substantive rights
of parties affected, as it is impossible to fix that boundary by general condition. (State vs. Pavelick, 279 P., 1102.) This
being so, it is inevitable that the Supreme Court in making rules should step on substantive rights, and the Constitution
must be presumed to tolerate if not to expect such incursion as does not affect the accused in a harsh and arbitrary
manner or deprive him of a defense, but operates only in a limited and unsubstantial manner to his disadvantage. For
the Court's power is not merely to compile, revise or codify the rules of procedure existing at the time of the
Constitution's approval. This power is "to promulgate rules concerning pleading, practice, and procedure in all courts,"
which is a power to adopt a general, complete and comprehensive system of procedure, adding new and different rules
without regard to their source and discarding old ones.

The motion is denied.

------
G.R. No. 226679
SALVADOR ESTIPONA, JR. y ASUELA, Petitioner, vs. HON. FRANK E. LOBRIGO, Presiding Judge of the Regional Trial
Court, Branch 3, Legazpi City, Albay, and PEOPLE OF THE PHILIPPINES, Respondents.

DECISION
PERALTA, J.:

Challenged in this petition for certiorari and prohibition1 is the constitutionality of Section 23 of Republic Act (R.A.) No.
9165, or the "Comprehensive Dangerous Drugs Act of 2002, "2 which provides:
SEC 23. Plea-Bargaining Provision. - Any person charged under any provision of this Act regardless of the imposable
penalty shall not be allowed to avail of the provision on plea-bargaining.3

The facts are not in dispute.

Petitioner Salvador A. Estipona, Jr. (Estipona) is the accused in Criminal Case No. 13586 for violation of Section 11,
Article II of R.A. No. 9165 (Possession of Dangerous Drugs). The Information alleged:

That on or about the 21st day of March, 2016, in the City of Legazpi, Philippines, and within the jurisdiction of this
Honorable Court, the above-named accused, not being lawfully authorized to possess or otherwise use any regulated
drug and without the corresponding license or prescription, did then and there, willfully, unlawfully and feloniously have,
in his possession and under his control and custody, one (1) piece heat-sealed transparent plastic sachet marked as VOP
03/21/16- l G containing 0.084 [gram] of white crystalline substance, which when examined were found to be positive
for Methamphetamine Hydrocloride (Shabu), a dangerous drug.

CONTRARY TO LAW.4

On June 15, 2016, Estipona filed a Motion to Allow the Accused to Enter into a Plea Bargaining Agreement,5 praying to
withdraw his not guilty plea and, instead, to enter a plea of guilty for violation of Section 12, Article II of R.A. No. 9165
(Possession of Equipment, Instrument, Apparatus and Other Paraphernalia for Dangerous Drugs) with a penalty of
rehabilitation in view of his being a first-time offender and the minimal quantity of the dangerous drug seized in his
possession. He argued that Section 23 of R.A. No. 9165 violates: (1) the intent of the law expressed in paragraph 3,
Section 2 thereof; (2) the rule-making authority of the Supreme Court under Section 5(5), Article VIII of the 1987
Constitution; and (3) the principle of separation of powers among the three equal branches of the government.

In its Comment or Opposition6 dated June 27, 2016, the prosecution moved for the denial of the motion for being
contrary to Section 23 of R.A. No. 9165, which is said to be justified by the Congress' prerogative to choose which
offense it would allow plea bargaining. Later, in a Comment or Opposition7 dated June 29, 2016, it manifested that it "is
open to the Motion of the accused to enter into plea bargaining to give life to the intent of the law as provided in
paragraph 3, Section 2 of [R.A. No.] 9165, however, with the express mandate of Section 23 of [R.A. No.] 9165
prohibiting plea bargaining, [it] is left without any choice but to reject the proposal of the accused."

On July 12, 2016, respondent Judge Frank E. Lobrigo of the Regional Trial Court (RTC), Branch 3, Legazpi City, Albay,
issued an Order denying Estipona's motion. It was opined:

The accused posited in his motion that Sec. 23 of RA No. 9165, which prohibits plea bargaining, encroaches on the
exclusive constitutional power of the Supreme Court to promulgate rules of procedure because plea bargaining is a "rule
of procedure." Indeed, plea bargaining forms part of the Rules on Criminal Procedure, particularly under Rule 118, the
rule on pre-trial conference. It is only the Rules of Court promulgated by the Supreme Court pursuant to its
constitutional rule-making power that breathes life to plea bargaining. It cannot be found in any statute.

Without saying so, the accused implies that Sec. 23 of Republic Act No. 9165 is unconstitutional because it, in effect,
suspends the operation of Rule 118 of the Rules of Court insofar as it allows plea bargaining as part of the mandatory
pre-trial conference in criminal cases.

The Court sees merit in the argument of the accused that it is also the intendment of the law, R.A. No. 9165, to
rehabilitate an accused of a drug offense. Rehabilitation is thus only possible in cases of use of illegal drugs because plea
bargaining is disallowed. However, by case law, the Supreme Court allowed rehabilitation for accused charged with
possession of paraphernalia with traces of dangerous drugs, as held in People v. Martinez, G.R. No. 191366, 13
December 2010. The ruling of the Supreme Court in this case manifested the relaxation of an otherwise stringent
application of Republic Act No. 9165 in order to serve an intent for the enactment of the law, that is, to rehabilitate the
offender.

Within the spirit of the disquisition in People v. Martinez, there might be plausible basis for the declaration of Sec. 23 of
R.A. No. 9165, which bars plea bargaining as unconstitutional because indeed the inclusion of the provision in the law
encroaches on the exclusive constitutional power of the Supreme Court.

While basic is the precept that lower courts are not precluded from resolving, whenever warranted, constitutional
questions, the Court is not unaware of the admonition of the Supreme Court that lower courts must observe a becoming
modesty in examining constitutional questions. Upon which admonition, it is thus not for this lower court to declare Sec.
23 of R.A. No. 9165 unconstitutional given the potential ramifications that such declaration might have on the
prosecution of illegal drug cases pending before this judicial station.8

Estipona filed a motion for reconsideration, but it was denied in an Order9 dated July 26, 2016; hence, this petition
raising the issues as follows:
I.
WHETHER SECTION 23 OF REPUBLIC ACT NO. 9165, WHICH PROHIBITS PLEA BARGAINING IN ALL VIOLATIONS OF THE
SAID LAW, IS UNCONSTITUTIONAL FOR BEING VIOLATIVE OF THE CONSTITUTIONAL RIGHT TO EQUAL PROTECTION OF
THE LAW.
II.
WHETHER SECTION 23 OF REPUBLIC ACT NO. 9165 IS UNCONSTITUTIONAL AS IT ENCROACHED UPON THE POWER OF
THE SUPREME COURT TO PROMULGATE RULES OF PROCEDURE.
III.
WHETHER THE REGIONAL TRIAL COURT, AS PRESIDED BY HON. FRANK E. LOBRIGO, COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION WHEN IT REFUSED TO DECLARE SECTION 23 OF
REPUBLIC ACT NO. 9165 AS UNCONSTITUTIONAL.10

We grant the petition.

PROCEDURAL MATTERS
The People of the Philippines, through the Office of the Solicitor General (OSG), contends that the petition should be
dismissed outright for being procedurally defective on the grounds that: (1) the Congress should have been impleaded
as an indispensable party; (2) the constitutionality of Section 23 of R.A. No. 9165 cannot be attacked collaterally; and (3)
the proper recourse should have been a petition for declaratory relief before this Court or a petition for certiorari before
the RTC. Moreover, the OSG argues that the petition fails to satisfy the requisites of judicial review because: (1) Estipona
lacks legal standing to sue for failure to show direct injury; (2) there is no actual case or controversy; and (3) the
constitutionality of Section 23 of R.A. No. 9165 is not the lis mota of the case.

On matters of technicality, some points raised by the OSG maybe correct.1âwphi1 Nonetheless, without much further
ado, it must be underscored that it is within this Court's power to make exceptions to the rules of court. Under proper
conditions, We may permit the full and exhaustive ventilation of the parties' arguments and positions despite the
supposed technical infirmities of a petition or its alleged procedural flaws. In discharging its solemn duty as the final
arbiter of constitutional issues, the Court shall not shirk from its obligation to determine novel issues, or issues of first
impression, with far-reaching implications.11

Likewise, matters of procedure and technicalities normally take a backseat when issues of substantial and
transcendental importance are present.12 We have acknowledged that the Philippines' problem on illegal drugs has
reached "epidemic," "monstrous," and "harrowing" proportions,13 and that its disastrously harmful social, economic,
and spiritual effects have broken the lives, shattered the hopes, and destroyed the future of thousands especially our
young citizens.14 At the same time, We have equally noted that "as urgent as the campaign against the drug problem
must be, so must we as urgently, if not more so, be vigilant in the protection of the rights of the accused as mandated by
the Constitution x x x who, because of excessive zeal on the part of the law enforcers, may be unjustly accused and
convicted."15 Fully aware of the gravity of the drug menace that has beset our country and its direct link to certain
crimes, the Court, within its sphere, must do its part to assist in the all-out effort to lessen, if not totally eradicate, the
continued presence of drug lords, pushers and users.16

Bearing in mind the very important and pivotal issues raised in this petition, technical matters should not deter Us from
having to make the final and definitive pronouncement that everyone else depends for enlightenment and guidance.17
When public interest requires, the Court may brush aside procedural rules in order to resolve a constitutional issue.18

x x x [T]he Court is invested with the power to suspend the application of the rules of procedure as a necessary
complement of its power to promulgate the same. Barnes v. Hon. Quijano Padilla discussed the rationale for this tenet,
viz. :
Let it be emphasized that the rules of procedure should be viewed as mere tools designed to facilitate the attainment of
justice. Their strict and rigid application, which would result in technicalities that tend to frustrate rather than promote
substantial justice, must always be eschewed. Even the Rules of Court reflect this principle. The power to suspend or
even disregard rules can be so pervasive and compelling as to alter even that which this Court itself has already declared
to be final, x x x.

The emerging trend in the rulings of this Court is to afford every party litigant the amplest opportunity for the proper
and just determination of his cause, free from the constraints of technicalities. Time and again, this Court has
consistently held that rules must not be applied rigidly so as not to override substantial justice. 19

SUBSTANTIVE ISSUES
Rule-making power of the Supreme
Court under the 1987 Constitution

Section 5(5), A1iicle VIII of the 1987 Constitution explicitly provides:

Sec. 5. The Supreme Court shall have the following powers:
xxxx
(5) Promulgate rules concerning the protection and enforcement of constitutional rights, pleading, practice, and
procedure in all courts, the admission to the practice of law, the Integrated Bar, and legal assistance to the
underprivileged. Such rules shall provide a simplified and inexpensive procedure for the speedy disposition of cases,
shall be uniform for all courts of the same grade, and shall not diminish, increase, or modify substantive rights. Rules of
procedure of special courts and quasi-judicial bodies shall remain effective unless disapproved by the Supreme Court.

The power to promulgate rules of pleading, practice and procedure is now Our exclusive domain and no longer shared
with the Executive and Legislative departments.20 In Echegaray v. Secretary of Justice, 21 then Associate Justice (later
Chief Justice) Reynato S. Puno traced the history of the Court's rule-making power and highlighted its evolution and
development.

x x x It should be stressed that the power to promulgate rules of pleading, practice and procedure was granted by our
Constitutions to this Court to enhance its independence, for in the words of Justice Isagani Cruz "without independence
and integrity, courts will lose that popular trust so essential to the maintenance of their vigor as champions of justice."
Hence, our Constitutions continuously vested this power to this Court for it enhances its independence. Under the 1935
Constitution, the power of this Court to promulgate rules concerning pleading, practice and procedure was granted but
it appeared to be co-existent with legislative power for it was subject to the power of Congress to repeal, alter or
supplement. Thus, its Section 13, Article VIII provides:

"Sec. 13. The Supreme Court shall have the power to promulgate rules concerning pleading, practice and procedure in
all courts, and the admission to the practice of law. Said rules shall be uniform for all courts of the same grade and shall
not diminish, increase, or modify substantive rights. The existing laws on pleading, practice and procedure are hereby
repealed as statutes, and are declared Rules of Court, subject to the power of the Supreme Court to alter and modify the
same. The Congress shall have the power to repeal, alter or supplement the rules concerning pleading, practice and
procedure, and the admission to the practice of law in the Philippines."

The said power of Congress, however, is not as absolute as it may appear on its surface. In In re: Cunanan Congress in
the exercise of its power to amend rules of the Supreme Court regarding admission to the practice of law, enacted the
Bar Flunkers Act of 1953 which considered as a passing grade, the average of 70% in the bar examinations after July 4,
1946 up to August 1951 and 71 % in the 1952 bar examinations. This Court struck down the law as unconstitutional. In
his ponencia, Mr. Justice Diokno held that "x x x the disputed law is not a legislation; it is a judgment - a judgment
promulgated by this Court during the aforecited years affecting the bar candidates concerned; and although this Court
certainly can revoke these judgments even now, for justifiable reasons, it is no less certain that only this Court, and not
the legislative nor executive department, that may do so. Any attempt on the part of these departments would be a
clear usurpation of its function, as is the case with the law in question." The venerable jurist further ruled: "It is obvious,
therefore, that the ultimate power to grant license for the practice of law belongs exclusively to this Court, and the law
passed by Congress on the matter is of permissive character, or as other authorities say, merely to fix the minimum
conditions for the license." By its ruling, this Court qualified the absolutist tone of the power of Congress to "repeal, alter
or supplement the rules concerning pleading, practice and procedure, and the admission to the practice of law in the
Philippines.

The ruling of this Court in In re Cunanan was not changed by the 1973 Constitution. For the 1973 Constitution reiterated
the power of this Court "to promulgate rules concerning pleading, practice and procedure in all courts, x x x which,
however, may be repealed, altered or supplemented by the Batasang Pambansa x x x." More completely, Section 5(2)5
of its Article X provided:

xxxx
"Sec. 5. The Supreme Court shall have the following powers.
xxxx
(5) Promulgate rules concerning pleading, practice, and procedure in all courts, the admission to the practice of law, and
the integration of the Bar, which, however, may be repealed, altered, or supplemented by the Batasang Pambansa. Such
rules shall provide a simplified and inexpensive procedure for the speedy disposition of cases, shall be uniform for all
courts of the same grade, and shall not diminish, increase, or modify substantive rights."

Well worth noting is that the 1973 Constitution further strengthened the independence of the judiciary by giving to it
the additional power to promulgate rules governing the integration of the Bar.

The 1987 Constitution molded an even stronger and more independent judiciary. Among others, it enhanced the rule
making power of this Court. Its Section 5(5), Article VIII provides:

xxxx
"Section 5. The Supreme Court shall have the following powers:
xxx
(5) Promulgate rules concerning the protection and enforcement of constitutional rights, pleading, practice and
procedure in all courts, the admission to the practice of law, the Integrated Bar, and legal assistance to the
underprivileged. Such rules shall provide a simplified and inexpensive procedure for the speedy disposition of cases,
shall be uniform for all courts of the same grade, and shall not diminish, increase, or modify substantive rights. Rules of
procedure of special courts and quasi-judicial bodies shall remain effective unless disapproved by the Supreme Court. "

The rule making power of this Court was expanded. This Court for the first time was given the power to promulgate
rules concerning the protection and enforcement of constitutional rights. The Court was also granted for the .first time
the power to disapprove rules of procedure of special courts and quasi-judicial bodies. But most importantly, the 1987
Constitution took away the power of Congress to repeal, alter, or supplement rules concerning pleading, practice and
procedure. In fine, the power to promulgate rules of pleading, practice and procedure is no longer shared by this Court
with Congress, more so with the Executive. x x x.22

Just recently, Carpio-Morales v. Court of Appeals (Sixth Division)23 further elucidated:

While the power to define, prescribe, and apportion the jurisdiction of the various courts is, by constitutional design,
vested unto Congress, the power to promulgate rules concerning the protection and enforcement of constitutional
rights, pleading, practice, and procedure in all courts belongs exclusively to this Court. Section 5 (5), Article VIII of the
1987 Constitution reads:
xxxx
In Echegaray v. Secretary of Justice (Echegaray), the Court traced the evolution of its rule-making authority, which,
under the 1935 and 1973 Constitutions, had been priorly subjected to a power-sharing scheme with Congress. As it now
stands, the 1987 Constitution textually altered the old provisions by deleting the concurrent power of Congress to
amend the rules, thus solidifying in one body the Court's rule-making powers, in line with the Framers' vision of
institutionalizing a " [ s] tronger and more independent judiciary."

The records of the deliberations of the Constitutional Commission would show that the Framers debated on whether or
not the Court's rulemaking powers should be shared with Congress. There was an initial suggestion to insert the
sentence "The National Assembly may repeal, alter, or supplement the said rules with the advice and concurrence of the
Supreme Court," right after the phrase "Promulgate rules concerning the protection and enforcement of constitutional
rights, pleading, practice, and procedure in all courts, the admission to the practice of law, the integrated bar, and legal
assistance to the underprivileged[,]" in the enumeration of powers of the Supreme Court. Later, Commissioner Felicitas
S. Aquino proposed to delete the former sentence and, instead, after the word "[under]privileged," place a comma(,) to
be followed by "the phrase with the concurrence of the National Assembly." Eventually, a compromise formulation was
reached wherein (a) the Committee members agreed to Commissioner Aquino's proposal to delete the phrase "the
National Assembly may repeal, alter, or supplement the said rules with the advice and concurrence of the Supreme
Court" and (b) in turn, Commissioner Aquino agreed to withdraw his proposal to add "the phrase with the concurrence
of the National Assembly." The changes were approved, thereby leading to the present lack of textual reference to any
form of Congressional participation in Section 5 (5), Article VIII, supra. Theprevailing consideration was that "both bodies,
the Supreme Court and the Legislature, have their inherent powers."

Thus, as it now stands, Congress has no authority to repeal, alter, or supplement rules concerning pleading, practice, and
procedure.x x x.24

The separation of powers among the three co-equal branches of our government has erected an impregnable wall that
keeps the power to promulgate rules of pleading, practice and procedure within the sole province of this Court.25 The
other branches trespass upon this prerogative if they enact laws or issue orders that effectively repeal, alter or modify
any of the procedural rules promulgated by the Court.26 Viewed from this perspective, We have rejected previous
attempts on the part of the Congress, in the exercise of its legislative power, to amend the Rules of Court (Rules), to wit:
1. Fabian v. Desierto27 -Appeal from the decision of the Office of the Ombudsman in an administrative disciplinary case
should be taken to the Court of Appeals under the provisions of Rule 43 of the Rules instead of appeal by certiorari
under Rule 45 as provided in Section 27 of R.A. No. 6770.
2. Cathay Metal Corporation v. Laguna West Multi-Purpose Cooperative, Inc. 28 - The Cooperative Code provisions on
notices cannot replace the rules on summons under Rule 14 of the Rules.
3. RE: Petition for Recognition of the Exemption of the GSIS from Payment of Legal Fees; 29 Baguio Market Vendors
Multi-Purpose Cooperative (BAMARVEMPCO) v. Hon. Judge Cabato-Cortes;30 In Re: Exemption of the National Power
Corporation from Payment of Filing/Docket Fees; 31 and Rep. of the Phils. v. Hon. Mangotara, et al. 32 - Despite
statutory provisions, the GSIS, BAMARVEMPCO, and NPC are not exempt from the payment of legal fees imposed by
Rule 141 of the Rules.
4. Carpio-Morales v. Court of Appeals (Sixth Division)33 - The first paragraph of Section 14 of R.A. No. 6770, which
prohibits courts except the Supreme Court from issuing temporary restraining order and/or writ of preliminary
injunction to enjoin an investigation conducted by the Ombudsman, is unconstitutional as it contravenes Rule 58 of the
Rules.

Considering that the aforesaid laws effectively modified the Rules, this Court asserted its discretion to amend, repeal or
even establish new rules of procedure, to the exclusion of the legislative and executive branches of government. To
reiterate, the Court's authority to promulgate rules on pleading, practice, and procedure is exclusive and one of the
safeguards of Our institutional independence.34

Plea bargaining in criminal cases

Plea bargaining, as a rule and a practice, has been existing in our jurisdiction since July 1, 1940, when the 1940 Rules
took effect. Section 4, Rule 114 (Pleas) of which stated:
SEC. 4. Plea of guilty of lesser offense. - The defendant, with the consent of the court and of the fiscal, may plead guilty
of any lesser offense than that charged which is necessarily included in the offense charged in the complaint or
information.
When the 1964 Rules became effective on January 1, 1964, the same provision was retained under Rule 118
(Pleas).1âwphi1 Subsequently, with the effectivity of the 1985 Rules on January 1, 1985, the provision on plea of guilty
to a lesser offense was amended. Section 2, Rule 116 provided:
SEC. 2. Plea of guilty to a lesser offense. - The accused with the consent of the offended party and the fiscal, may be
allowed by the trial court to plead guilty to a lesser offense, regardless of whether or not it is necessarily included in the
crime charged, or is cognizable by a court of lesser jurisdiction than the trial court. No amendment of the complaint or
information is necessary. (4a, R-118)

As well, the term "plea bargaining" was first mentioned and expressly required during pre-trial. Section 2, Rule 118
mandated:
SEC. 2. Pre-trial conference; subjects. - The pre-trial conference shall consider the following:
(a) Plea bargaining;
(b) Stipulation of facts;
(c) Marking for identification of evidence of the parties;
(d) Waiver of objections to admissibility of evidence; and
(e) Such other matters as will promote a fair and expeditious trial. (n)

The 1985 Rules was later amended. While the wordings of Section 2, Rule 118 was retained, Section 2, Rule 116 was
modified in 1987. A second paragraph was added, stating that "[a] conviction under this plea shall be equivalent to a
conviction of the offense charged for purposes of double jeopardy."

When R.A. No. 8493 ("Speedy Trial Act of 1998 ') was enacted,35 Section 2, Rule 118 of the Rules was substantially
adopted. Section 2 of the law required that plea bargaining and other matters36 that will promote a fair and expeditious
trial are to be considered during pre-trial conference in all criminal cases cognizable by the Municipal Trial Court,
Municipal Circuit Trial Court, Metropolitan Trial Court, Regional Trial Court, and the Sandiganbayan.

Currently, the pertinent rules on plea bargaining under the 2000 Rules37 are quoted below:

RULE 116 (Arraignment and Plea):

SEC. 2. Plea of guilty to a lesser offense. - At arraignment, the accused, with the consent of the offended party and the
prosecutor, may be allowed by the trial court to plead guilty to a lesser offense which is necessarily included in the
offense charged. After arraignment but before trial, the accused may still be allowed to plead guilty to said lesser
offense after withdrawing his plea of not guilty. No amendment of the complaint or information is necessary. (Sec. 4, Cir.
38-98)

RULE 118 (Pre-trial):

SEC. 1. Pre-trial; mandatory in criminal cases. - In all criminal cases cognizable by the Sandiganbayan, Regional Trial
Court, Metropolitan Trial Court, Municipal Trial Court in Cities, Municipal Trial Court and Municipal Circuit Trial Court,
the court shall, after arraignment and within thirty (30) days from the date the court acquires jurisdiction over the
person of the accused, unless a shorter period is provided for in special laws or circulars of the Supreme Court, order a
pre-trial conference to consider the following:
(a) plea bargaining;
(b) stipulation of facts;
(c) marking for identification of evidence of the parties;
(d) waiver of objections to admissibility of evidence;
(e) modification of the order of trial if the accused admits the charge but interposes a lawful defense; and
(f) such matters as will promote a fair and expeditious trial of the criminal and civil aspects of the case. (Sec. 2 & 3, Cir.
38-98)

Plea bargaining is a rule of procedure

The Supreme Court's sole prerogative to issue, amend, or repeal procedural rules is limited to the preservation of
substantive rights, i.e., the former should not diminish, increase or modify the latter.38 "Substantive law is that part of
the law which creates, defines and regulates rights, or which regulates the right and duties which give rise to a cause of
action; that part of the law which courts are established to administer; as opposed to adjective or remedial law, which
prescribes the method of enforcing rights or obtain redress for their invasions."39 Fabian v. Hon. Desierto40 laid down
the test for determining whether a rule is substantive or procedural in nature.

It will be noted that no definitive line can be drawn between those rules or statutes which are procedural, hence within
the scope of this Court's rule-making power, and those which are substantive. In fact, a particular rule may be
procedural in one context and substantive in another. It is admitted that what is procedural and what is substantive is
frequently a question of great difficulty. It is not, however, an insurmountable problem if a rational and pragmatic
approach is taken within the context of our own procedural and jurisdictional system.

In determining whether a rule prescribed by the Supreme Court, for the practice and procedure of the lower courts,
abridges, enlarges, or modifies any substantive right, the test is whether the rule really regulates procedure, that is, the
judicial process for enforcing rights and duties recognized by substantive law and for justly administering remedy and
redress for a disregard or infraction of them. If the rule takes away a vested right, it is not procedural. If the rule creates
a right such as the right to appeal, it may be classified as a substantive matter; but if it operates as a means of
implementing an existing right then the rule deals merely with procedure.41

In several occasions, We dismissed the argument that a procedural rule violates substantive rights. For example, in
People v. Lacson, 42 Section 8, Rule 117 of the Rules on provisional dismissal was held as a special procedural limitation
qualifying the right of the State to prosecute, making the time-bar an essence of the given right or as an inherent part
thereof, so that its expiration operates to extinguish the right of the State to prosecute the accused.43 Speaking through
then Associate Justice Romeo J. Callejo, Sr., the Court opined:

In the new rule in question, as now construed by the Court, it has fixed a time-bar of one year or two years for the
revival of criminal cases provisionally dismissed with the express consent of the accused and with a priori notice to the
offended party. The time-bar may appear, on first impression, unreasonable compared to the periods under Article 90 of
the Revised Penal Code. However, in fixing the time-bar, the Court balanced the societal interests and those of the
accused for the orderly and speedy disposition of criminal cases with minimum prejudice to the State and the accused. It
took into account the substantial rights of both the State and of the accused to due process. The Court believed that the
time limit is a reasonable period for the State to revive provisionally dismissed cases with the consent of the accused
and notice to the offended parties. The time-bar fixed by the Court must be respected unless it is shown that the period
is manifestly short or insufficient that the rule becomes a denial of justice. The petitioners failed to show a manifest
shortness or insufficiency of the time-bar.

The new rule was conceptualized by the Committee on the Revision of the Rules and approved by the Court en banc
primarily to enhance the administration of the criminal justice system and the rights to due process of the State and the
accused by eliminating the deleterious practice of trial courts of provisionally dismissing criminal cases on motion of
either the prosecution or the accused or jointly, either with no time-bar for the revival thereof or with a specific or
definite period for such revival by the public prosecutor. There were times when such criminal cases were no longer
revived or refiled due to causes beyond the control of the public prosecutor or because of the indolence, apathy or the
lackadaisical attitude of public prosecutors to the prejudice of the State and the accused despite the mandate to public
prosecutors and trial judges to expedite criminal proceedings.

It is almost a universal experience that the accused welcomes delay as it usually operates in his favor, especially if he
greatly fears the consequences of his trial and conviction. He is hesitant to disturb the hushed inaction by which
dominant cases have been known to expire.

The inordinate delay in the revival or refiling of criminal cases may impair or reduce the capacity of the State to prove its
case with the disappearance or nonavailability of its witnesses. Physical evidence may have been lost. Memories of
witnesses may have grown dim or have faded. Passage of time makes proof of any fact more difficult. The accused may
become a fugitive from justice or commit another crime. The longer the lapse of time from the dismissal of the case to
the revival thereof, the more difficult it is to prove the crime.

On the other side of the fulcrum, a mere provisional dismissal of a criminal case does not terminate a criminal case. The
possibility that the case may be revived at any time may disrupt or reduce, if not derail, the chances of the accused for
employment, curtail his association, subject him to public obloquy and create anxiety in him and his family. He is unable
to lead a normal life because of community suspicion and his own anxiety. He continues to suffer those penalties and
disabilities incompatible with the presumption of innocence. He may also lose his witnesses or their memories may fade
with the passage of time. In the long run, it may diminish his capacity to defend himself and thus eschew the fairness of
the entire criminal justice system.

The time-bar under the new rule was fixed by the Court to excise the malaise that plagued the administration of the
criminal justice system for the benefit of the State and the accused; not for the accused only.44

Also, We said in Jaylo, et al. v. Sandiganbayan, et al. 45 that Section 6, Rule 120 of the Rules, which provides that an
accused who failed to appear at the promulgation of the judgment of conviction shall lose the remedies available against
the judgment, does not take away substantive rights but merely provides the manner through which an existing right
may be implemented.

Section 6, Rule 120, of the Rules of Court, does not take away per se the right of the convicted accused to avail of the
remedies under the Rules. It is the failure of the accused to appear without justifiable cause on the scheduled date of
promulgation of the judgment of conviction that forfeits their right to avail themselves of the remedies against the
judgment.

It is not correct to say that Section 6, Rule 120, of the Rules of Court diminishes or modifies the substantive rights of
petitioners. It only works in pursuance of the power of the Supreme Court to "provide a simplified and inexpensive
procedure for the speedy disposition of cases." This provision protects the courts from delay in the speedy disposition of
criminal cases - delay arising from the simple expediency of nonappearance of the accused on the scheduled
promulgation of the judgment of conviction.46

By the same token, it is towards the provision of a simplified and inexpensive procedure for the speedy disposition of
cases in all courts47 that the rules on plea bargaining was introduced. As a way of disposing criminal charges by
agreement of the parties, plea bargaining is considered to be an "important," "essential," "highly desirable," and
"legitimate" component of the administration of justice.48 Some of its salutary effects include:

x x x For a defendant who sees slight possibility of acquittal, the advantages of pleading guilty and limiting the probable
penalty are obvious - his exposure is reduced, the correctional processes can begin immediately, and the practical
burdens of a trial are eliminated. For the State there are also advantages - the more promptly imposed punishment after
an admission of guilt may more effectively attain the objectives of punishment; and with the avoidance of trial, scarce
judicial and prosecutorial resources are conserved for those cases in which there is a substantial issue of the defendant's
guilt or in which there is substantial doubt that the State can sustain its burden of proof. (Brady v. United States, 397 U.S.
742, 752 [1970])

Disposition of charges after plea discussions x x x leads to prompt and largely final disposition of most criminal cases; it
avoids much of the corrosive impact of enforced idleness during pretrial confinement for those who are denied release
pending trial; it protects the public from those accused persons who are prone to continue criminal conduct even while
on pretrial release; and, by shortening the time between charge and disposition, it enhances whatever may be the
rehabilitative prospects of the guilty when they are ultimately imprisoned. (Santobello v. New York, 404 U.S. 257, 261
[1971])

The defendant avoids extended pretrial incarceration and the anxieties and uncertainties of a trial; he gains a speedy
disposition of his case, the chance to acknowledge his guilt, and a prompt start in realizing whatever potential there may
be for rehabilitation. Judges and prosecutors conserve vital and scarce resources. The public is protected from the risks
posed by those charged with criminal offenses who are at large on bail while awaiting completion of criminal
proceedings. (Blackledge v. Allison, 431 U.S. 63, 71 [1977])

In this jurisdiction, plea bargaining has been defined as "a process whereby the accused and the prosecution work out a
mutually satisfactory disposition of the case subject to court approval."49 There is give-and-take negotiation common in
plea bargaining.50 The essence of the agreement is that both the prosecution and the defense make concessions to
avoid potential losses.51 Properly administered, plea bargaining is to be encouraged because the chief virtues of the
system - speed, economy, and finality - can benefit the accused, the offended party, the prosecution, and the court.52
Considering the presence of mutuality of advantage,53 the rules on plea bargaining neither create a right nor take away
a vested right. Instead, it operates as a means to implement an existing right by regulating the judicial process for
enforcing rights and duties recognized by substantive law and for justly administering remedy and redress for a
disregard or infraction of them.

The decision to plead guilty is often heavily influenced by the defendant's appraisal of the prosecution's case against him
and by the apparent likelihood of securing leniency should a guilty plea be offered and accepted.54 In any case, whether
it be to the offense charged or to a lesser crime, a guilty plea is a "serious and sobering occasion" inasmuch as it
constitutes a waiver of the fundamental rights to be presumed innocent until the contrary is proved, to be heard by
himself and counsel, to meet the witnesses face to face, to bail (except those charged with offenses punishable by
reclusion perpetua when evidence of guilt is strong), to be convicted by proof beyond reasonable doubt, and not to be
compelled to be a witness against himself.55

Yet a defendant has no constitutional right to plea bargain. No basic rights are infringed by trying him rather than
accepting a plea of guilty; the prosecutor need not do so if he prefers to go to trial.56 Under the present Rules, the
acceptance of an offer to plead guilty is not a demandable right but depends on the consent of the offended party57
and the prosecutor, which is a condition precedent to a valid plea of guilty to a lesser offense that is necessarily included
in the offense charged.58 The reason for this is that the prosecutor has full control of the prosecution of criminal actions;
his duty is to always prosecute the proper offense, not any lesser or graver one, based on what the evidence on hand
can sustain.59

[Courts] normally must defer to prosecutorial decisions as to whom to prosecute. The reasons for judicial deference are
well known. Prosecutorial charging decisions are rarely simple. In addition to assessing the strength and importance of a
case, prosecutors also must consider other tangible and intangible factors, such as government enforcement priorities.
Finally, they also must decide how best to allocate the scarce resources of a criminal justice system that simply cannot
accommodate the litigation of every serious criminal charge. Because these decisions "are not readily susceptible to the
kind of analysis the courts are competent to undertake," we have been "properly hesitant to examine the decision
whether to prosecute. "60

The plea is further addressed to the sound discretion of the trial court, which may allow the accused to plead guilty to a
lesser offense which is necessarily included in the offense charged. The word may denotes an exercise of discretion upon
the trial court on whether to allow the accused to make such plea.61 Trial courts are exhorted to keep in mind that a
plea of guilty for a lighter offense than that actually charged is not supposed to be allowed as a matter of bargaining or
compromise for the convenience of the accused.62

Plea bargaining is allowed during the arraignment, the pre-trial, or even up to the point when the prosecution already
rested its case.63 As regards plea bargaining during the pre-trial stage, the trial court's exercise of discretion should not
amount to a grave abuse thereof.64 "Grave abuse of discretion" is a capricious and whimsical exercise of judgment so
patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a duty enjoined by law, as
where the power is exercised in an arbitrary and despotic manner because of passion or hostility; it arises when a court
or tribunal violates the Constitution, the law or existing jurisprudence.65

If the accused moved to plead guilty to a lesser offense subsequent to a bail hearing or after the prosecution rested its
case, the rules allow such a plea only when the prosecution does not have sufficient evidence to establish the guilt of
the crime charged.66 The only basis on which the prosecutor and the court could rightfully act in allowing change in the
former plea of not guilty could be nothing more and nothing less than the evidence on record. As soon as the prosecutor
has submitted a comment whether for or against said motion, it behooves the trial court to assiduously study the
prosecution's evidence as well as all the circumstances upon which the accused made his change of plea to the end that
the interests of justice and of the public will be served.67 The ruling on the motion must disclose the strength or
weakness of the prosecution's evidence.68 Absent any finding on the weight of the evidence on hand, the judge's
acceptance of the defendant's change of plea is improper and irregular.69

On whether Section 23 of R.A. No.

9165 violates the equal protection
clause
At this point, We shall not resolve the issue of whether Section 23 of R.A. No. 9165 is contrary to the constitutional right
to equal protection of the law in order not to preempt any future discussion by the Court on the policy considerations
behind Section 23 of R.A. No. 9165. Pending deliberation on whether or not to adopt the statutory provision in toto or a
qualified version thereof, We deem it proper to declare as invalid the prohibition against plea bargaining on drug cases
until and unless it is made part of the rules of procedure through an administrative circular duly issued for the purpose.

WHEREFORE, the petition for certiorari and prohibition is GRANTED. Section 23 of Republic Act No. 9165 is declared
unconstitutional for being contrary to the rule-making authority of the Supreme Court under Section 5(5), Article VIII of
the 1987 Constitution.
SO ORDERED.
----
G.R. No. 188051 November 22, 2010
ASIA UNITED BANK, Petitioner, vs. GOODLAND COMPANY, INC., Respondent.
DECISION
NACHURA, J.:

Petitioner assails the February 16, 2009 Decision1 and the May 18, 2009 Resolution2 of the Court of Appeals (CA) in CA-
G.R. SP No. 103304, annulling the August 23, 20073 and February 15, 20084 Orders of the Regional Trial Court (RTC) of
Makati City, Branch 150, which in turn denied due course to respondent Goodland Company, Inc.’s (GOODLAND) notice
of appeal for invalid substitution of counsel.

The antecedents:
An Ex-Parte Application/Petition for the Issuance of Writ of Possession5 was filed by Asia United Bank (AUB) over a
5,801-square- meter lot located in Makati City and covered by Transfer Certificate of Title (TCT) No. 223120 of the
Registry of Deeds of Makati in AUB’s name. The property was previously registered in the name of GOODLAND under
TCT No. 192674 (114645).

The petition alleged that, on February 20, 2000, GOODLAND executed a Third Party Real Estate Mortgage on the
property in favor of AUB to secure the ₱202 million credit accommodation extended by the latter to Radiomarine
Network (Smartnet) Inc. (Radiomarine).

When Radiomarine defaulted in the payment of its obligation, AUB instituted extrajudicial foreclosure proceedings
against the real estate mortgage. At the public auction sale held on December 4, 2006, AUB was declared the highest
bidder. On the same date, a Certificate of Sale was issued in its name and registered with the Registry of Deeds of
Makati City.

With the expiration of the redemption period, AUB proceeded to execute an Affidavit of Consolidation of Ownership,
through its First Vice-President, Florante del Mundo. AUB thereafter secured a Certificate Authorizing Registration from
the Bureau of Internal Revenue to facilitate the transfer of the title.

On December 8, 2006, TCT No. 192674 (114645) was cancelled and, in lieu thereof, TCT No. 223120 was issued in the
name of AUB.

GOODLAND, through its counsel, Atty. Antonio Bautista (Atty. Bautista), opposed the petition, denying that it executed
the real estate mortgage. GOODLAND further averred that the signature of the notary public appearing on the deed was
a forgery, and that no technical description of the property supposedly mortgaged was indicated therein. Concluding
that AUB’s title was derived from the foreclosure of a fake mortgage, GOODLAND prayed for the petition’s denial.6

On March 1, 2007, the RTC issued the writ of possession sought by AUB. It ratiocinated that, as the purchaser of the
property at the foreclosure sale and as the new title holder thereof, AUB’s right of possession and enjoyment of the
same had become absolute.7

GOODLAND, through its counsel on record, Atty. Bautista, filed a motion for reconsideration8 and a supplemental
motion for reconsideration,9 but both were denied in the Order10 dated April 25, 2007, which was received by Atty.
Bautista on June 15, 2007.11
Relentless, GOODLAND sought recourse with the CA by initially filing a Notice of Appeal12 with the RTC, through a
certain Atty. Lito Mondragon (Atty. Mondragon) of the Mondragon & Montoya Law Offices. On August 23, 2007, the RTC
issued an Order13 denying due course to GOODLAND’s notice of appeal for being legally inutile due to Atty.
Mondragon’s failure to properly effect the substitution of former counsel on record, Atty. Bautista. GOODLAND moved
for reconsideration, but the same was denied in the Order dated February 15, 2008.14

GOODLAND elevated the incident to the CA by way of a special civil acton for certiorari. In its February 16, 2009 Decision,
the CA granted the petition and directed the RTC to give due course to the notice of appeal, thus:
WHEREFORE, the petition is hereby GRANTED. The assailed Orders dated August 23, 2007 and February 15, 2008 of the
Regional Trial Court, Branch 150, Makati City are ANNULLED and SET ASIDE. The trial court is DIRECTED to give due
course to petitioner’s Notice of Appeal.
SO ORDERED.15

Aggrieved, AUB moved for reconsideration, but the CA denied the motion in its Resolution dated May 18, 2009. Hence,
the present petition for review on certiorari,16 praying for the reinstatement of the RTC Order.

The petition is meritorious.

Under Rule 138, Section 26 of the Rules of Court, for a substitution of attorney to be effectual, the following essential
requisites must concur: (1) there must be a written application for substitution; (2) it must be filed with the written
consent of the client; (3) it must be with the written consent of the attorney substituted; and (4) in case the consent of
the attorney to be substituted cannot be obtained, there must at least be proof of notice that the motion for
substitution was served on him in the manner prescribed by the Rules of Court. 17

The courts a quo were uniform and correct in finding that Atty. Mondragon failed to observe the prescribed procedure
and, thus, no valid substitution of counsel was actualized. However, they took divergent postures as to the repercussion
of such non-compliance, thereby igniting the herein controversy.

The RTC strictly imposed the rule on substitution of counsel and held that the notice of appeal filed by Atty. Mondragon
was a mere scrap of paper.lawphi1

However, relying on our pronouncement in Land Bank of the Philippines v. Pamintuan Development Co.,18 the CA
brushed aside the procedural lapse and took a liberal stance on considerations of substantial justice, viz.:

It is a far better and more prudent course of action for the court to excuse a technical lapse and afford the parties a
review of the case on appeal to attain the ends of justice rather than dispose of the case on technicality and cause a
grave injustice to the parties, giving a false impression of speedy disposal of cases while actually resulting in more delay,
if not a miscarriage of justice. Thus, substantial justice would be better served by giving due course to petitioner’s notice
of appeal.19

AUB argues that the liberality applied by the Court in Land Bank is incompatible with the herein controversy, and that
Pioneer Insurance and Surety Corporation v. De Dios Transportation Co., Inc.,20 which espouses the same view adopted
by the RTC, is more appropriate.

GOODLAND, on the other hand, insists that the CA committed no reversible error in ordering that the notice of appeal
be allowed in order not to frustrate the ends of substantial justice.

We agree with AUB. A revisit of our pronouncements in Land Bank and Pioneer is in order.

In Land Bank, we held that the Department of Agrarian Reform Adjudication Board gravely abused its discretion when it
denied due course to the Notice of Appeal and Notice of Entry of Appearance filed by petitioner’s new counsel for
failure to effect a valid substitution of the former counsel on record.

We clarified that the new counsel never intended to replace the counsel of record because, although not so specified in
the notice, they entered their appearance as collaborating counsel. Absent a formal notice of substitution, all lawyers
who appear before the court or file pleadings in behalf of a client are considered counsel of the latter. We pursued a
liberal application of the rule in order not to frustrate the just, speedy, and inexpensive determination of the
controversy.

In Pioneer, we adopted a strict posture and declared the notice of withdrawal of appeal filed by appellant’s new counsel
as a mere scrap of paper for his failure to file beforehand a motion for the substitution of the counsel on record.

Provoking such deportment was the absence of a special power of attorney authorizing the withdrawal of the appeal in
addition to the lack of a proper substitution of counsel. More importantly, we found that the withdrawal of the appeal
was calculated to frustrate the satisfaction of the judgment debt rendered against appellant, thereby necessitating a
rigid application of the rules in order to deter appellant from benefiting from its own deleterious manipulation thereof.

The emerging trend of jurisprudence is more inclined to the liberal and flexible application of the Rules of Court.
However, we have not been remiss in reminding the bench and the bar that zealous compliance with the rules is still the
general course of action. Rules of procedure are in place to ensure the orderly, just, and speedy dispensation of cases;21
to this end, inflexibility or liberality must be weighed. The relaxation or suspension of procedural rules or the exemption
of a case from their operation is warranted only by compelling reasons or when the purpose of justice requires it.22

As early as 1998, in Hon. Fortich v. Hon. Corona,23 we expounded on these guiding principles:

Procedural rules, we must stress, should be treated with utmost respect and due regard since they are designed to
facilitate the adjudication of cases to remedy the worsening problem of delay in the resolution of rival claims and in the
administration of justice. The requirement is in pursuance to the bill of rights inscribed in the Constitution which
guarantees that "all persons shall have a right to the speedy disposition of their cases before all judicial, quasi-judicial
and administrative bodies." The adjudicatory bodies and the parties to a case are thus enjoined to abide strictly by the
rules. While it is true that a litigation is not a game of technicalities, it is equally true that every case must be prosecu ted
in accordance with the prescribed procedure to ensure an orderly and speedy administration of justice. There have been
some instances wherein this Court allowed a relaxation in the application of the rules, but this flexibility was "never
intended to forge a bastion for erring litigants to violate the rules with impunity." A liberal interpretation and application
of the rules of procedure can be resorted to only in proper cases and under justifiable causes and circumstances.

In Sebastian v. Hon. Morales,24 we straightened out the misconception that the enforcement of procedural rules should
never be permitted if it would prejudice the substantive rights of litigants:

Under Rule 1, Section 6 of the 1997 Rules of Civil Procedure, liberal construction of the rules is the controlling principle
to effect substantial justice. Thus, litigations should, as much as possible, be decided on their merits and not on
technicalities. This does not mean, however, that procedural rules are to be ignored or disdained at will to suit the
convenience of a party. Procedural law has its own rationale in the orderly administration of justice, namely, to ensure
the effective enforcement of substantive rights by providing for a system that obviates arbitrariness, caprice, despotism,
or whimsicality in the settlement of disputes. Hence, it is a mistake to suppose that substantive law and procedural law
are contradictory to each other, or as often suggested, that enforcement of procedural rules should never be permitted
if it would result in prejudice to the substantive rights of the litigants.

x x x. Hence, rules of procedure must be faithfully followed except only when for persuasive reasons, they may be
relaxed to relieve a litigant of an injustice not commensurate with his failure to comply with the prescribed procedure. x
x x.

Indeed, the primordial policy is a faithful observance of the Rules of Court, and their relaxation or suspension should
only be for persuasive reasons and only in meritorious cases, to relieve a litigant of an injustice not commensurate with
the degree of his thoughtlessness in not complying with the procedure prescribed.25 Further, a bare invocation of "the
interest of substantial justice" will not suffice to override a stringent implementation of the rules.26

A reading of the CA’s Decision readily shows that the leniency it granted GOODLAND was merely anchored on
substantial justice. The CA overlooked GOODLAND’s failure to advance meritorious reasons to support its plea for the
relaxation of Rule 138, Section 26. The fact that GOODLAND stands to lose a valuable property is inadequate to dispense
with the exacting imposition of a rather basic rule.
More importantly, the CA failed to realize that the ultimate consequences that will come about should GOODLAND’s
appeal proceed would in fact contravene substantial justice. The CA and, eventually, this Court will just re-litigate an
otherwise non-litigious matter and thereby compound the delay GOODLAND attempts to perpetrate in order to prevent
AUB from rightfully taking possession of the property.

It is a time-honored legal precept that after the consolidation of titles in the buyer's name, for failure of the mortgagor
to redeem, entitlement to a writ of possession becomes a matter of right.27 As the confirmed owner, the purchaser’s
right to possession becomes absolute.28 There is even no need for him to post a bond,29 and it is the ministerial duty of
the courts to issue the same upon proper application and proof of title.30 To accentuate the writ’s ministerial character,
the Court has consistently disallowed injunction to prohibit its issuance despite a pending action for annulment of
mortgage or the foreclosure itself.31

The nature of an ex parte petition for issuance of the possessory writ under Act No. 3135 has been described as a non-
litigious proceeding and summary in nature.32 As an ex parte proceeding, it is brought for the benefit of one party only,
and without notice to or consent by any person adversely interested.33

Subsequent proceedings in the appellate courts would merely involve a reiteration of the foregoing settled doctrines.
The issue involved in the assailed RTC issuances is conclusively determined by the above cited legal dictum, and it would
be unnecessarily vexatious and unjust to allow the present controversy to undergo protracted litigation.

AUB’s right of possession is founded on its right of ownership over the property which it purchased at the auction sale.
Upon expiration of the redemption period and consolidation of the title to the property, its possessory rights over the
same became absolute. We quote with approval the pronouncement of the RTC, viz.:

As the purchaser of the property in the foreclosure sale to which new title has already been issued, petitioner’s right
over the property has become absolute, vesting upon it the right of possession and enjoyment of the property which
this Court must aid in effecting its delivery. Under the circumstances, and following established doctrine, the issuance of
a writ of possession is a ministerial function whereby the court exercises neither discretion nor judgment x x x. Said writ
of possession must be enforced without delay x x x.34

The law does not require that a petition for a writ of possession be granted only after documentary and testimonial
evidence shall have been offered to and admitted by the court.35 As long as a verified petition states the facts sufficient
to entitle petitioner to the relief requested, the court shall issue the writ prayed for.36

Given the foregoing, we are bound to deny a liberal application of the rules on substitution of counsel and resolve
definitively that GOODLAND’s notice of appeal merits a denial, for the failure of Atty. Mondragon to effect a valid
substitution of the counsel on record. Substantial justice would be better served if the notice of appeal is disallowed. In
the same way that the appellant in Pioneer was not permitted to profit from its own manipulation of the rules on
substitution of counsel, so too can GOODLAND be not tolerated to foster vexatious delay by allowing its notice of appeal
to carry on.

WHEREFORE, premises considered, the petition is GRANTED. The February 16, 2009 Decision and the May 18, 2009
Resolution of the Court of Appeals are hereby ANNULLED and SET ASIDE; and the August 23, 2007 and February 15, 2008
Orders of the Regional Trial Court of Makati City, Branch 150, are REINSTATED.
SO ORDERED.