Aug 3

July 30, 1979
PETITION FOR AUTHORITY TO CONTINUE USE OF THE FIRM NAME "SYCIP, SALAZAR,
FELICIANO, HERNANDEZ & CASTILLO." LUCIANO E. SALAZAR, FLORENTINO P.
FELICIANO, BENILDO G. HERNANDEZ. GREGORIO R. CASTILLO. ALBERTO P. SAN JUAN,
JUAN C. REYES. JR., ANDRES G. GATMAITAN, JUSTINO H. CACANINDIN, NOEL A. LAMAN,
ETHELWOLDO E. FERNANDEZ, ANGELITO C. IMPERIO, EDUARDO R. CENIZA, TRISTAN A.
CATINDIG, ANCHETA K. TAN, and ALICE V. PESIGAN, petitioners.
IN THE MATTER OF THE PETITION FOR AUTHORITY TO CONTINUE USE OF THE FIRM NAME
"OZAETA, ROMULO, DE LEON, MABANTA & REYES." RICARDO J. ROMULO, BENJAMIN M.
DE LEON, ROMAN MABANTA, JR., JOSE MA, REYES, JESUS S. J. SAYOC, EDUARDO DE
LOS ANGELES, and JOSE F. BUENAVENTURA, petitioners.
RESOLUTION
MELENCIO-HERRERA, J.: ñé+.£ªwph!1
Two separate Petitions were filed before this Court 1) by the surviving partners of Atty. Alexander
Sycip, who died on May 5, 1975, and 2) by the surviving partners of Atty. Herminio Ozaeta, who died
on February 14, 1976, praying that they be allowed to continue using, in the names of their firms, the
names of partners who had passed away. In the Court's Resolution of September 2, 1976, both
Petitions were ordered consolidated.
Petitioners base their petitions on the following arguments:
1. Under the law, a partnership is not prohibited from continuing its business under a firm name
which includes the name of a deceased partner; in fact, Article 1840 of the Civil Code explicitly
sanctions the practice when it provides in the last paragraph that:
têñ.£îhqwâ£
The use by the person or partnership continuing the business of the partnership
name, or the name of a deceased partner as part thereof, shall not of itself make the
individual property of the deceased partner liable for any debts contracted by such
person or partnership. 1
2. In regulating other professions, such as accountancy and engineering, the legislature has
authorized the adoption of firm names without any restriction as to the use, in such firm name, of the
name of a deceased partner; the legislative authorization given to those engaged in the practice of
2
accountancy — a profession requiring the same degree of trust and confidence in respect of clients
as that implicit in the relationship of attorney and client — to acquire and use a trade name, strongly
indicates that there is no fundamental policy that is offended by the continued use by a firm of
professionals of a firm name which includes the name of a deceased partner, at least where such
firm name has acquired the characteristics of a "trade name." 3
3. The Canons of Professional Ethics are not transgressed by the continued use of the name of a
deceased partner in the firm name of a law partnership because Canon 33 of the Canons of
Professional Ethics adopted by the American Bar Association declares that: têñ.£îhqwâ£
... The continued use of the name of a deceased or former partner when permissible
by local custom, is not unethical but care should be taken that no imposition or
deception is practiced through this use. ...
4
4. There is no possibility of imposition or deception because the deaths of their respective deceased
partners were well-publicized in all newspapers of general circulation for several days; the
stationeries now being used by them carry new letterheads indicating the years when their
respective deceased partners were connected with the firm; petitioners will notify all leading national
and international law directories of the fact of their respective deceased partners' deaths.
5
5. No local custom prohibits the continued use of a deceased partner's name in a professional firm's
name; there is no custom or usage in the Philippines, or at least in the Greater Manila Area, which
6
recognizes that the name of a law firm necessarily Identifies the individual members of the firm. 7
6. The continued use of a deceased partner's name in the firm name of law partnerships has been
consistently allowed by U.S. Courts and is an accepted practice in the legal profession of most
countries in the world.
8
The question involved in these Petitions first came under consideration by this Court in 1953 when a
law firm in Cebu (the Deen case) continued its practice of including in its firm name that of a
deceased partner, C.D. Johnston. The matter was resolved with this Court advising the firm to desist
from including in their firm designation the name of C. D. Johnston, who has long been dead."
The same issue was raised before this Court in 1958 as an incident in G. R. No. L-11964, entitled
Register of Deeds of Manila vs. China Banking Corporation. The law firm of Perkins & Ponce Enrile
moved to intervene as amicus curiae. Before acting thereon, the Court, in a Resolution of April 15,
1957, stated that it "would like to be informed why the name of Perkins is still being used although
Atty. E. A. Perkins is already dead." In a Manifestation dated May 21, 1957, the law firm of Perkins
and Ponce Enrile, raising substantially the same arguments as those now being raised by
petitioners, prayed that the continued use of the firm name "Perkins & Ponce Enrile" be held proper.
On June 16, 1958, this Court resolved: têñ.£îhqwâ£
After carefully considering the reasons given by Attorneys Alfonso Ponce Enrile and
Associates for their continued use of the name of the deceased E. G. Perkins, the
Court found no reason to depart from the policy it adopted in June 1953 when it
required Attorneys Alfred P. Deen and Eddy A. Deen of Cebu City to desist from
including in their firm designation, the name of C. D. Johnston, deceased. The Court
believes that, in view of the personal and confidential nature of the relations between
attorney and client, and the high standards demanded in the canons of professional
ethics, no practice should be allowed which even in a remote degree could give rise
to the possibility of deception. Said attorneys are accordingly advised to drop the
name "PERKINS" from their firm name.
Petitioners herein now seek a re-examination of the policy thus far enunciated by the Court.
The Court finds no sufficient reason to depart from the rulings thus laid down.
A. Inasmuch as "Sycip, Salazar, Feliciano, Hernandez and Castillo" and "Ozaeta, Romulo, De Leon,
Mabanta and Reyes" are partnerships, the use in their partnership names of the names of deceased
partners will run counter to Article 1815 of the Civil Code which provides:
têñ.£îhqwâ£
Art. 1815. Every partnership shall operate under a firm name, which may or may not
include the name of one or more of the partners.
Those who, not being members of the partnership, include their names in the firm
name, shall be subject to the liability, of a partner.
It is clearly tacit in the above provision that names in a firm name of a partnership must either be
those of living partners and. in the case of non-partners, should be living persons who can be
subjected to liability. In fact, Article 1825 of the Civil Code prohibits a third person from including his
name in the firm name under pain of assuming the liability of a partner. The heirs of a deceased
partner in a law firm cannot be held liable as the old members to the creditors of a firm particularly
where they are non-lawyers. Thus, Canon 34 of the Canons of Professional Ethics "prohibits an
agreement for the payment to the widow and heirs of a deceased lawyer of a percentage, either
gross or net, of the fees received from the future business of the deceased lawyer's clients, both
because the recipients of such division are not lawyers and because such payments will not
represent service or responsibility on the part of the recipient. " Accordingly, neither the widow nor
the heirs can be held liable for transactions entered into after the death of their lawyer-predecessor.
There being no benefits accruing, there ran be no corresponding liability.
Prescinding the law, there could be practical objections to allowing the use by law firms of the names
of deceased partners. The public relations value of the use of an old firm name can tend to create
undue advantages and disadvantages in the practice of the profession. An able lawyer without
connections will have to make a name for himself starting from scratch. Another able lawyer, who
can join an old firm, can initially ride on that old firm's reputation established by deceased partners.
B. In regards to the last paragraph of Article 1840 of the Civil Code cited by petitioners, supra, the
first factor to consider is that it is within Chapter 3 of Title IX of the Code entitled "Dissolution and
Winding Up." The Article primarily deals with the exemption from liability in cases of a dissolved
partnership, of the individual property of the deceased partner for debts contracted by the person or
partnership which continues the business using the partnership name or the name of the deceased
partner as part thereof. What the law contemplates therein is a hold-over situation preparatory to
formal reorganization.
Secondly, Article 1840 treats more of a commercial partnership with a good will to protect rather than
of a professional partnership, with no saleable good will but whose reputation depends on the
personal qualifications of its individual members. Thus, it has been held that a saleable goodwill can
exist only in a commercial partnership and cannot arise in a professional partnership consisting of
lawyers. 9
têñ.£îhqwâ£
As a general rule, upon the dissolution of a commercial partnership the succeeding

partners or parties have the right to carry on the business under the old name, in the
absence of a stipulation forbidding it, (s)ince the name of a commercial partnership is
a partnership asset inseparable from the good will of the firm. ... (60 Am Jur 2d, s
204, p. 115) (Emphasis supplied)
On the other hand, têñ.£îhqwâ£
... a professional partnership the reputation of which depends or; the individual skill of
the members, such as partnerships of attorneys or physicians, has no good win to be
distributed as a firm asset on its dissolution, however intrinsically valuable such skill
and reputation may be, especially where there is no provision in the partnership
agreement relating to good will as an asset. ... (ibid, s 203, p. 115) (Emphasis
supplied)
C. A partnership for the practice of law cannot be likened to partnerships formed by other
professionals or for business. For one thing, the law on accountancy specifically allows the use of a
trade name in connection with the practice of accountancy. 10
têñ.£îhqwâ£
A partnership for the practice of law is not a legal entity. It is a mere relationship or
association for a particular purpose. ... It is not a partnership formed for the purpose
of carrying on trade or business or of holding property." Thus, it has been stated
11
that "the use of a nom de plume, assumed or trade name in law practice is
improper. 12
The usual reason given for different standards of conduct being applicable to the
practice of law from those pertaining to business is that the law is a profession.
Dean Pound, in his recently published contribution to the Survey of the Legal
Profession, (The Lawyer from Antiquity to Modern Times, p. 5) defines a profession
as "a group of men pursuing a learned art as a common calling in the spirit of public
service, — no less a public service because it may incidentally be a means of
livelihood."
xxx xxx xxx
Primary characteristics which distinguish the legal profession from business are:
1. A duty of public service, of which the emolument is a byproduct, and in which one
may attain the highest eminence without making much money.
2. A relation as an "officer of court" to the administration of justice involving thorough

sincerity, integrity, and reliability.
3. A relation to clients in the highest degree fiduciary.
4. A relation to colleagues at the bar characterized by candor, fairness, and

unwillingness to resort to current business methods of advertising and encroachment
on their practice, or dealing directly with their clients. 13
"The right to practice law is not a natural or constitutional right but is in the nature of a privilege or
franchise. It is limited to persons of good moral character with special qualifications duly
14
ascertained and certified. The right does not only presuppose in its possessor integrity, legal
15
standing and attainment, but also the exercise of a special privilege, highly personal and partaking
of the nature of a public trust."
16
D. Petitioners cited Canon 33 of the Canons of Professional Ethics of the American Bar Association"
in support of their petitions.
It is true that Canon 33 does not consider as unethical the continued use of the name of a deceased
or former partner in the firm name of a law partnership when such a practice is permissible by local
custom but the Canon warns that care should be taken that no imposition or deception is practiced
through this use.
It must be conceded that in the Philippines, no local custom permits or allows the continued use of a
deceased or former partner's name in the firm names of law partnerships. Firm names, under our
custom, Identify the more active and/or more senior members or partners of the law firm. A glimpse
at the history of the firms of petitioners and of other law firms in this country would show how their
firm names have evolved and changed from time to time as the composition of the partnership
changed. têñ.£îhqwâ£
The continued use of a firm name after the death of one or more of the partners
designated by it is proper only where sustained by local custom and not where by
custom this purports to Identify the active members. ...
There would seem to be a question, under the working of the Canon, as to the
propriety of adding the name of a new partner and at the same time retaining that of
a deceased partner who was never a partner with the new one. (H.S. Drinker, op.
cit., supra, at pp. 207208) (Emphasis supplied).
The possibility of deception upon the public, real or consequential, where the name of a deceased
partner continues to be used cannot be ruled out. A person in search of legal counsel might be
guided by the familiar ring of a distinguished name appearing in a firm title.
E. Petitioners argue that U.S. Courts have consistently allowed the continued use of a deceased
partner's name in the firm name of law partnerships. But that is so because it is sanctioned by
custom.
In the case of Mendelsohn v. Equitable Life Assurance Society (33 N.Y.S. 2d 733) which petitioners
Salazar, et al. quoted in their memorandum, the New York Supreme Court sustained the use of the
firm name Alexander & Green even if none of the present ten partners of the firm bears either
name because the practice was sanctioned by custom and did not offend any statutory provision or
legislative policy and was adopted by agreement of the parties. The Court stated therein: têñ.£îhqwâ£
The practice sought to be proscribed has the sanction of custom and offends no

statutory provision or legislative policy. Canon 33 of the Canons of Professional
Ethics of both the American Bar Association and the New York State Bar Association
provides in part as follows: "The continued use of the name of a deceased or former
partner, when permissible by local custom is not unethical, but care should be taken
that no imposition or deception is practiced through this use." There is no question
as to local custom. Many firms in the city use the names of deceased members with
the approval of other attorneys, bar associations and the courts. The Appellate
Division of the First Department has considered the matter and reached The
conclusion that such practice should not be prohibited. (Emphasis supplied)
xxx xxx xxx
Neither the Partnership Law nor the Penal Law prohibits the practice in question. The
use of the firm name herein is also sustainable by reason of agreement between the
partners.
18
Not so in this jurisdiction where there is no local custom that sanctions the practice. Custom has
been defined as a rule of conduct formed by repetition of acts, uniformly observed (practiced) as a
social rule, legally binding and obligatory. Courts take no judicial notice of custom. A custom must
19
be proved as a fact, according to the rules of evidence. A local custom as a source of right cannot
20
be considered by a court of justice unless such custom is properly established by competent

evidence like any other fact. We find such proof of the existence of a local custom, and of the
21
elements requisite to constitute the same, wanting herein. Merely because something is done as a
matter of practice does not mean that Courts can rely on the same for purposes of adjudication as a
juridical custom. Juridical custom must be differentiated from social custom. The former can
supplement statutory law or be applied in the absence of such statute. Not so with the latter.
Moreover, judicial decisions applying or interpreting the laws form part of the legal system. When
22
the Supreme Court in the Deen and Perkins cases issued its Resolutions directing lawyers to desist
from including the names of deceased partners in their firm designation, it laid down a legal rule
against which no custom or practice to the contrary, even if proven, can prevail. This is not to speak
of our civil law which clearly ordains that a partnership is dissolved by the death of any
partner. Custom which are contrary to law, public order or public policy shall not be
23
countenanced. 24
The practice of law is intimately and peculiarly related to the administration of justice and should not
be considered like an ordinary "money-making trade." têñ.£îhqwâ£
... It is of the essence of a profession that it is practiced in a spirit of public service. A

trade ... aims primarily at personal gain; a profession at the exercise of powers
beneficial to mankind. If, as in the era of wide free opportunity, we think of free
competitive self assertion as the highest good, lawyer and grocer and farmer may
seem to be freely competing with their fellows in their calling in order each to acquire
as much of the world's good as he may within the allowed him by law. But the
member of a profession does not regard himself as in competition with his
professional brethren. He is not bartering his services as is the artisan nor
exchanging the products of his skill and learning as the farmer sells wheat or corn.
There should be no such thing as a lawyers' or physicians' strike. The best service of
the professional man is often rendered for no equivalent or for a trifling equivalent
and it is his pride to do what he does in a way worthy of his profession even if done
with no expectation of reward, This spirit of public service in which the profession of
law is and ought to be exercised is a prerequisite of sound administration of justice
according to law. The other two elements of a profession, namely, organization and
pursuit of a learned art have their justification in that they secure and maintain that
spirit.
25
In fine, petitioners' desire to preserve the Identity of their firms in the eyes of the public must bow to
legal and ethical impediment.
ACCORDINGLY, the petitions filed herein are denied and petitioners advised to drop the names
"SYCIP" and "OZAETA" from their respective firm names. Those names may, however, be included
in the listing of individuals who have been partners in their firms indicating the years during which
they served as such.
SO ORDERED.
Teehankee, Concepcion, Jr., Santos, Fernandez, Guerrero and De Castro, JJ., concur
Fernando, C.J. and Abad Santos, J., took no part.
Separate Opinions
FERNANDO, C.J., concurring:
The petitions are denied, as there are only four votes for granting them, seven of the Justices being
of the contrary view, as explained in the plurality opinion of Justice Ameurfina Melencio-Herrera. It is
out of delicadeza that the undersigned did not participate in the disposition of these petitions, as the
law office of Sycip, Salazar, Feliciano, Hernandez and Castillo started with the partnership of
Quisumbing, Sycip, and Quisumbing, the senior partner, the late Ramon Quisumbing, being the
father-in-law of the undersigned, and the most junior partner then, Norberto J. Quisumbing, being his
brother- in-law. For the record, the undersigned wishes to invite the attention of all concerned, and
not only of petitioners, to the last sentence of the opinion of Justice Ameurfina Melencio-Herrera:
'Those names [Sycip and Ozaeta] may, however, be included in the listing of individuals wtes
AQUINO, J., dissenting:
I dissent. The fourteen members of the law firm, Sycip, Salazar, Feliciano, Hernandez & Castillo, in
their petition of June 10, 1975, prayed for authority to continue the use of that firm name,
notwithstanding the death of Attorney Alexander Sycip on May 5, 1975 (May he rest in peace). He
was the founder of the firm which was originally known as the Sycip Law Office.
On the other hand, the seven surviving partners of the law firm, Ozaeta, Romulo, De Leon, Mabanta
& Reyes, in their petition of August 13, 1976, prayed that they be allowed to continue using the said
firm name notwithstanding the death of two partners, former Justice Roman Ozaeta and his son,
Herminio, on May 1, 1972 and February 14, 1976, respectively.
They alleged that the said law firm was a continuation of the Ozaeta Law Office which was
established in 1957 by Justice Ozaeta and his son and that, as to the said law firm, the name
Ozaeta has acquired an institutional and secondary connotation.
Article 1840 of the Civil Code, which speaks of the use by the partnership of the name of a deceased
partner as part of the partnership name, is cited to justify the petitions. Also invoked is the canon that
the continued use by a law firm of the name of a deceased partner, "when permissible by local
custom, is not unethical" as long as "no imposition or deception is practised through this use"
(Canon 33 of the Canons of Legal Ethics).
I am of the opinion that the petition may be granted with the condition that it be indicated in the
letterheads of the two firms (as the case may be) that Alexander Sycip, former Justice Ozaeta and
Herminio Ozaeta are dead or the period when they served as partners should be stated therein.
Obviously, the purpose of the two firms in continuing the use of the names of their deceased
founders is to retain the clients who had customarily sought the legal services of Attorneys Sycip and
Ozaeta and to benefit from the goodwill attached to the names of those respected and esteemed law
practitioners. That is a legitimate motivation.
The retention of their names is not illegal per se. That practice was followed before the war by the
law firm of James Ross. Notwithstanding the death of Judge Ross the founder of the law firm of
Ross, Lawrence, Selph and Carrascoso, his name was retained in the firm name with an indication
of the year when he died. No one complained that the retention of the name of Judge Ross in the
firm name was illegal or unethical.
Commissioner of Internal Revenue v. Aichi Forging
Company of Asia, Inc., G.R. No. 184823, 06 October 2010
24 Nov
[DEL CASTILLO, J.]
FACTS
Respondent Aichi filed a claim for refund/credit of input VAT for the period July 1,
2002 to September 30, 2002, with the petitioner Commissioner of Internal Revenue
(CIR), through the Department of Finance (DOF) One-Stop Shop Inter-Agency Tax
Credit and Duty Drawback Center.On even date, respondent filed a Petition for
Review with the CTA for the refund/credit of the same input VAT. The CTA
partially granted the petition. In a Motion for Reconsideration, petitioner argued that
the simultaneous filing of the administrative and the judicial claims contravenes
Sections 112 and 229 of the NIRC and a prior filing of an administrative claim is a
“condition precedent” before a judicial claim can be filed. The CTA En Banc affirmed
the division ruling.
ISSUE
Whether the respondent’s judicial and administrative claims for tax refund/credit were
filed within the two-year prescriptive period as provided in Sections 112(A) and 229
of the NIRC.
HELD
NO.
The two-year period to file a claim for tax refund/credit for the period July 1, 2002 to
September 30, 2002 expired on September 30, 2004. Hence, respondent’s
administrative claim was timely filed.The filing of the judicial claim was premature.
However, notwithstanding the timely filing of the administrative claim, [the Supreme
Court is] constrained to deny respondent’s claim for tax refund/credit for having been
filed in violation of Section 112(D). Section 112(D) of the NIRC clearly provides that
the CIR has “120 days, from the date of the submission of the complete documents in
support of the application [for tax refund/credit],” within which to grant or deny the
claim. In case of full or partial denial by the CIR, the taxpayer’s recourse is to file an
appeal before the CTA within 30 days from receipt of the decision of the CIR.
However, if after the 120-day period the CIR fails to act on the application for tax
refund/credit, the remedy of the taxpayer is to appeal the inaction of the CIR to CTA
within 30 days.
In this case, the administrative and the judicial claims were simultaneously filed on
September 30, 2004. Obviously, respondent did not wait for the decision of the CIR or
the lapse of the 120-day period. For this reason, we find the filing of the judicial claim
with the CTA premature. The premature filing of respondent’s claim for refund/credit
of input VAT before the CTA warrants a dismissal inasmuch as no jurisdiction was
acquired by the CTA.
G.R. No. 184823 October 6, 2010
COMMISSIONER OF INTERNAL REVENUE, Petitioner,

vs.
AICHI FORGING COMPANY OF ASIA, INC., Respondent.
DECISION
DEL CASTILLO, J.:
A taxpayer is entitled to a refund either by authority of a statute expressly granting such right,
privilege, or incentive in his favor, or under the principle of solutio indebiti requiring the return of
taxes erroneously or illegally collected. In both cases, a taxpayer must prove not only his entitlement
to a refund but also his compliance with the procedural due process as non-observance of the
prescriptive periods within which to file the administrative and the judicial claims would result in the
denial of his claim.
This Petition for Review on Certiorari under Rule 45 of the Rules of Court seeks to set aside the July
30, 2008 Decision1 and the October 6, 2008 Resolution2 of the Court of Tax Appeals (CTA) En Banc.
Factual Antecedents
Respondent Aichi Forging Company of Asia, Inc., a corporation duly organized and existing under
the laws of the Republic of the Philippines, is engaged in the manufacturing, producing, and
processing of steel and its by-products.3 It is registered with the Bureau of Internal Revenue (BIR) as
a Value-Added Tax (VAT) entity4 and its products, "close impression die steel forgings" and "tool and
dies," are registered with the Board of Investments (BOI) as a pioneer status. 5
On September 30, 2004, respondent filed a claim for refund/credit of input VAT for the period July 1,
2002 to September 30, 2002 in the total amount of ₱3,891,123.82 with the petitioner Commissioner
of Internal Revenue (CIR), through the Department of Finance (DOF) One-Stop Shop Inter-Agency
Tax Credit and Duty Drawback Center. 6
Proceedings before the Second Division of the CTA
On even date, respondent filed a Petition for Review 7 with the CTA for the refund/credit of the same
input VAT. The case was docketed as CTA Case No. 7065 and was raffled to the Second Division of
the CTA.
In the Petition for Review, respondent alleged that for the period July 1, 2002 to September 30,
2002, it generated and recorded zero-rated sales in the amount of ₱131,791,399.00, 8 which was
paid pursuant to Section 106(A) (2) (a) (1), (2) and (3) of the National Internal Revenue Code of
1997 (NIRC);9 that for the said period, it incurred and paid input VAT amounting to ₱3,912,088.14
from purchases and importation attributable to its zero-rated sales;10 and that in its application for
refund/credit filed with the DOF One-Stop Shop Inter-Agency Tax Credit and Duty Drawback Center,
it only claimed the amount of ₱3,891,123.82. 11
In response, petitioner filed his Answer12 raising the following special and affirmative defenses, to wit:
4. Petitioner’s alleged claim for refund is subject to administrative investigation by the

Bureau;
5. Petitioner must prove that it paid VAT input taxes for the period in question;
6. Petitioner must prove that its sales are export sales contemplated under Sections 106(A)
(2) (a), and 108(B) (1) of the Tax Code of 1997;
7. Petitioner must prove that the claim was filed within the two (2) year period prescribed in
Section 229 of the Tax Code;
8. In an action for refund, the burden of proof is on the taxpayer to establish its right to
refund, and failure to sustain the burden is fatal to the claim for refund; and
9. Claims for refund are construed strictly against the claimant for the same partake of the
nature of exemption from taxation.13
Trial ensued, after which, on January 4, 2008, the Second Division of the CTA rendered a Decision
partially granting respondent’s claim for refund/credit. Pertinent portions of the Decision read:
For a VAT registered entity whose sales are zero-rated, to validly claim a refund, Section 112 (A) of
the NIRC of 1997, as amended, provides:
SEC. 112. Refunds or Tax Credits of Input Tax. –
(A) Zero-rated or Effectively Zero-rated Sales. – Any VAT-registered person, whose sales are zero-
rated or effectively zero-rated may, within two (2) years after the close of the taxable quarter when
the sales were made, apply for the issuance of a tax credit certificate or refund of creditable input tax
due or paid attributable to such sales, except transitional input tax, to the extent that such input tax
has not been applied against output tax: x x x
Pursuant to the above provision, petitioner must comply with the following requisites: (1) the
taxpayer is engaged in sales which are zero-rated or effectively zero-rated; (2) the taxpayer is VAT-
registered; (3) the claim must be filed within two years after the close of the taxable quarter when
such sales were made; and (4) the creditable input tax due or paid must be attributable to such
sales, except the transitional input tax, to the extent that such input tax has not been applied against
the output tax.
The Court finds that the first three requirements have been complied [with] by petitioner.
With regard to the first requisite, the evidence presented by petitioner, such as the Sales Invoices
(Exhibits "II" to "II-262," "JJ" to "JJ-431," "KK" to "KK-394" and "LL") shows that it is engaged in sales
which are zero-rated.
The second requisite has likewise been complied with. The Certificate of Registration with OCN
1RC0000148499 (Exhibit "C") with the BIR proves that petitioner is a registered VAT taxpayer.
In compliance with the third requisite, petitioner filed its administrative claim for refund on September
30, 2004 (Exhibit "N") and the present Petition for Review on September 30, 2004, both within the
two (2) year prescriptive period from the close of the taxable quarter when the sales were made,
which is from September 30, 2002.
As regards, the fourth requirement, the Court finds that there are some documents and claims of
petitioner that are baseless and have not been satisfactorily substantiated.
xxxx
In sum, petitioner has sufficiently proved that it is entitled to a refund or issuance of a tax credit
certificate representing unutilized excess input VAT payments for the period July 1, 2002 to
September 30, 2002, which are attributable to its zero-rated sales for the same period, but in the
reduced amount of ₱3,239,119.25, computed as follows:
Amount of Claimed Input VAT ₱ 3,891,123.82

Less:
Exceptions as found by the ICPA 41,020.37
Net Creditable Input VAT ₱ 3,850,103.45

Less:
Output VAT Due 610,984.20
Excess Creditable Input VAT ₱ 3,239,119.25
WHEREFORE, premises considered, the present Petition for Review is PARTIALLY GRANTED.
Accordingly, respondent is hereby ORDERED TO REFUND OR ISSUE A TAX CREDIT
CERTIFICATE in favor of petitioner [in] the reduced amount of THREE MILLION TWO HUNDRED
THIRTY NINE THOUSAND ONE HUNDRED NINETEEN AND 25/100 PESOS (₱3,239,119.25),
representing the unutilized input VAT incurred for the months of July to September 2002.
SO ORDERED.14
Dissatisfied with the above-quoted Decision, petitioner filed a Motion for Partial
Reconsideration,15 insisting that the administrative and the judicial claims were filed beyond the two-
year period to claim a tax refund/credit provided for under Sections 112(A) and 229 of the NIRC. He
reasoned that since the year 2004 was a leap year, the filing of the claim for tax refund/credit on
September 30, 2004 was beyond the two-year period, which expired on September 29, 2004. 16 He
cited as basis Article 13 of the Civil Code,17 which provides that when the law speaks of a year, it is
equivalent to 365 days. In addition, petitioner argued that the simultaneous filing of the
administrative and the judicial claims contravenes Sections 112 and 229 of the NIRC. 18 According to
the petitioner, a prior filing of an administrative claim is a "condition precedent" 19 before a judicial
claim can be filed. He explained that the rationale of such requirement rests not only on the doctrine
of exhaustion of administrative remedies but also on the fact that the CTA is an appellate body which
exercises the power of judicial review over administrative actions of the BIR. 20
The Second Division of the CTA, however, denied petitioner’s Motion for Partial Reconsideration for
lack of merit. Petitioner thus elevated the matter to the CTA En Banc via a Petition for Review.21
Ruling of the CTA En Banc
On July 30, 2008, the CTA En Banc affirmed the Second Division’s Decision allowing the partial tax
refund/credit in favor of respondent. However, as to the reckoning point for counting the two-year
period, the CTA En Banc ruled:
Petitioner argues that the administrative and judicial claims were filed beyond the period allowed by
law and hence, the honorable Court has no jurisdiction over the same. In addition, petitioner further
contends that respondent's filing of the administrative and judicial [claims] effectively eliminates the
authority of the honorable Court to exercise jurisdiction over the judicial claim.
We are not persuaded.
Section 114 of the 1997 NIRC, and We quote, to wit:
SEC. 114. Return and Payment of Value-added Tax. –
(A) In General. – Every person liable to pay the value-added tax imposed under this Title shall file a
quarterly return of the amount of his gross sales or receipts within twenty-five (25) days following the
close of each taxable quarter prescribed for each taxpayer: Provided, however, That VAT-registered
persons shall pay the value-added tax on a monthly basis.
[x x x x ]
Based on the above-stated provision, a taxpayer has twenty five (25) days from the close of each
taxable quarter within which to file a quarterly return of the amount of his gross sales or receipts. In
the case at bar, the taxable quarter involved was for the period of July 1, 2002 to September 30,
2002. Applying Section 114 of the 1997 NIRC, respondent has until October 25, 2002 within which to
file its quarterly return for its gross sales or receipts [with] which it complied when it filed its VAT
Quarterly Return on October 20, 2002.
In relation to this, the reckoning of the two-year period provided under Section 229 of the 1997 NIRC
should start from the payment of tax subject claim for refund. As stated above, respondent filed its
VAT Return for the taxable third quarter of 2002 on October 20, 2002. Thus, respondent's
administrative and judicial claims for refund filed on September 30, 2004 were filed on time because
AICHI has until October 20, 2004 within which to file its claim for refund.
In addition, We do not agree with the petitioner's contention that the 1997 NIRC requires the
previous filing of an administrative claim for refund prior to the judicial claim. This should not be the
case as the law does not prohibit the simultaneous filing of the administrative and judicial claims for
refund. What is controlling is that both claims for refund must be filed within the two-year prescriptive
period.
In sum, the Court En Banc finds no cogent justification to disturb the findings and conclusion spelled
out in the assailed January 4, 2008 Decision and March 13, 2008 Resolution of the CTA Second
Division. What the instant petition seeks is for the Court En Banc to view and appreciate the
evidence in their own perspective of things, which unfortunately had already been considered and
passed upon.
WHEREFORE, the instant Petition for Review is hereby DENIED DUE COURSE and DISMISSED
for lack of merit. Accordingly, the January 4, 2008 Decision and March 13, 2008 Resolution of the
CTA Second Division in CTA Case No. 7065 entitled, "AICHI Forging Company of Asia, Inc.
petitioner vs. Commissioner of Internal Revenue, respondent" are hereby AFFIRMED in toto.
SO ORDERED.22
Petitioner sought reconsideration but the CTA En Banc denied23 his Motion for Reconsideration.
Issue
Hence, the present recourse where petitioner interposes the issue of whether respondent’s judicial
and administrative claims for tax refund/credit were filed within the two-year prescriptive period
provided in Sections 112(A) and 229 of
the NIRC.24
Petitioner’s Arguments
Petitioner maintains that respondent’s administrative and judicial claims for tax refund/credit were
filed in violation of Sections 112(A) and 229 of the NIRC.25 He posits that pursuant to Article 13 of the
Civil Code,26 since the year 2004 was a leap year, the filing of the claim for tax refund/credit on
September 30, 2004 was beyond the two-year period, which expired on September 29, 2004. 27
Petitioner further argues that the CTA En Banc erred in applying Section 114(A) of the NIRC in
determining the start of the two-year period as the said provision pertains to the compliance
requirements in the payment of VAT.28 He asserts that it is Section 112, paragraph (A), of the same
Code that should apply because it specifically provides for the period within which a claim for tax
refund/ credit should be made.29
Petitioner likewise puts in issue the fact that the administrative claim with the BIR and the judicial
claim with the CTA were filed on the same day.30 He opines that the simultaneous filing of the
administrative and the judicial claims contravenes Section 229 of the NIRC, which requires the prior
filing of an administrative claim.31 He insists that such procedural requirement is based on the
doctrine of exhaustion of administrative remedies and the fact that the CTA is an appellate body
exercising judicial review over administrative actions of the CIR. 32
Respondent’s Arguments
For its part, respondent claims that it is entitled to a refund/credit of its unutilized input VAT for the
period July 1, 2002 to September 30, 2002 as a matter of right because it has substantially complied
with all the requirements provided by law.33 Respondent likewise defends the CTA En Banc in
applying Section 114(A) of the NIRC in computing the prescriptive period for the claim for tax
refund/credit. Respondent believes that Section 112(A) of the NIRC must be read together with
Section 114(A) of the same Code.34
As to the alleged simultaneous filing of its administrative and judicial claims, respondent contends
that it first filed an administrative claim with the One-Stop Shop Inter-Agency Tax Credit and Duty
Drawback Center of the DOF before it filed a judicial claim with the CTA.35 To prove this, respondent
points out that its Claimant Information Sheet No. 49702 36 and BIR Form No. 1914 for the third
quarter of 2002,37 which were filed with the DOF, were attached as Annexes "M" and "N,"
respectively, to the Petition for Review filed with the CTA.38 Respondent further contends that the
non-observance of the 120-day period given to the CIR to act on the claim for tax refund/credit in
Section 112(D) is not fatal because what is important is that both claims are filed within the two-year
prescriptive period.39 In support thereof, respondent cites Commissioner of Internal Revenue v.
Victorias Milling Co., Inc.40 where it was ruled that "[i]f, however, the [CIR] takes time in deciding the
claim, and the period of two years is about to end, the suit or proceeding must be started in the
[CTA] before the end of the two-year period without awaiting the decision of the [CIR]." 41 Lastly,
respondent argues that even if the period had already lapsed, it may be suspended for reasons of
equity considering that it is not a jurisdictional requirement. 42
Our Ruling
The petition has merit.
Unutilized input VAT must be claimed within two years after the close of the taxable quarter when
the sales were made
In computing the two-year prescriptive period for claiming a refund/credit of unutilized input VAT, the
Second Division of the CTA applied Section 112(A) of the NIRC, which states:
(A) Zero-rated or Effectively Zero-rated Sales – Any VAT-registered person, whose sales are zero-
rated or effectively zero-rated may, within two (2) years after the close of the taxable quarter when
the sales were made, apply for the issuance of a tax credit certificate or refund of creditable input tax
due or paid attributable to such sales, except transitional input tax, to the extent that such input tax
has not been applied against output tax: Provided, however, That in the case of zero-rated sales
under Section 106(A)(2)(a)(1), (2) and (B) and Section 108 (B)(1) and (2), the acceptable foreign
currency exchange proceeds thereof had been duly accounted for in accordance with the rules and
regulations of the Bangko Sentral ng Pilipinas (BSP): Provided, further, That where the taxpayer is
engaged in zero-rated or effectively zero-rated sale and also in taxable or exempt sale of goods or
properties or services, and the amount of creditable input tax due or paid cannot be directly and
entirely attributed to any one of the transactions, it shall be allocated proportionately on the basis of
the volume of sales. (Emphasis supplied.)
The CTA En Banc, on the other hand, took into consideration Sections 114 and 229 of the NIRC,
which read:
SEC. 114. Return and Payment of Value-Added Tax. –
(A) In General. – Every person liable to pay the value-added tax imposed under this Title shall file a
quarterly return of the amount of his gross sales or receipts within twenty-five (25) days following the
close of each taxable quarter prescribed for each taxpayer: Provided, however, That VAT-registered
persons shall pay the value-added tax on a monthly basis.
Any person, whose registration has been cancelled in accordance with Section 236, shall file a
return and pay the tax due thereon within twenty-five (25) days from the date of cancellation of
registration: Provided, That only one consolidated return shall be filed by the taxpayer for his
principal place of business or head office and all branches.
xxxx
SEC. 229. Recovery of tax erroneously or illegally collected. –
No suit or proceeding shall be maintained in any court for the recovery of any national internal
revenue tax hereafter alleged to have been erroneously or illegally assessed or collected, or of any
penalty claimed to have been collected without authority, or of any sum alleged to have been
excessively or in any manner wrongfully collected, until a claim for refund or credit has been duly
filed with the Commissioner; but such suit or proceeding may be maintained, whether or not such
tax, penalty or sum has been paid under protest or duress.
In any case, no such suit or proceeding shall be filed after the expiration of two (2) years from the
date of payment of the tax or penalty regardless of any supervening cause that may arise after
payment: Provided, however, That the Commissioner may, even without written claim therefor,
refund or credit any tax, where on the face of the return upon which payment was made, such
payment appears clearly to have been erroneously paid. (Emphasis supplied.)
Hence, the CTA En Banc ruled that the reckoning of the two-year period for filing a claim for
refund/credit of unutilized input VAT should start from the date of payment of tax and not from the
close of the taxable quarter when the sales were made. 43
The pivotal question of when to reckon the running of the two-year prescriptive period, however, has
already been resolved in Commissioner of Internal Revenue v. Mirant Pagbilao Corporation, 44 where
we ruled that Section 112(A) of the NIRC is the applicable provision in determining the start of the
two-year period for claiming a refund/credit of unutilized input VAT, and that Sections 204(C) and
229 of the NIRC are inapplicable as "both provisions apply only to instances of erroneous payment
or illegal collection of internal revenue taxes."45 We explained that:
The above proviso [Section 112 (A) of the NIRC] clearly provides in no uncertain terms
that unutilized input VAT payments not otherwise used for any internal revenue tax due the
taxpayer must be claimed within two years reckoned from the close of the taxable quarter
when the relevant sales were made pertaining to the input VAT regardless of whether said tax
was paid or not. As the CA aptly puts it, albeit it erroneously applied the aforequoted Sec. 112 (A),
"[P]rescriptive period commences from the close of the taxable quarter when the sales were made
and not from the time the input VAT was paid nor from the time the official receipt was issued." Thus,
when a zero-rated VAT taxpayer pays its input VAT a year after the pertinent transaction, said
taxpayer only has a year to file a claim for refund or tax credit of the unutilized creditable input VAT.
The reckoning frame would always be the end of the quarter when the pertinent sales or transaction
was made, regardless when the input VAT was paid. Be that as it may, and given that the last
creditable input VAT due for the period covering the progress billing of September 6, 1996 is the
third quarter of 1996 ending on September 30, 1996, any claim for unutilized creditable input VAT
refund or tax credit for said quarter prescribed two years after September 30, 1996 or, to be precise,
on September 30, 1998. Consequently, MPC’s claim for refund or tax credit filed on December 10,
1999 had already prescribed.
Reckoning for prescriptive period under
Secs. 204(C) and 229 of the NIRC inapplicable
To be sure, MPC cannot avail itself of the provisions of either Sec. 204(C) or 229 of the NIRC which,
for the purpose of refund, prescribes a different starting point for the two-year prescriptive limit for
the filing of a claim therefor. Secs. 204(C) and 229 respectively provide:
Sec. 204. Authority of the Commissioner to Compromise, Abate and Refund or Credit Taxes. – The
Commissioner may –
xxxx
(c) Credit or refund taxes erroneously or illegally received or penalties imposed without authority,
refund the value of internal revenue stamps when they are returned in good condition by the
purchaser, and, in his discretion, redeem or change unused stamps that have been rendered unfit
for use and refund their value upon proof of destruction. No credit or refund of taxes or penalties
shall be allowed unless the taxpayer files in writing with the Commissioner a claim for credit or
refund within two (2) years after the payment of the tax or penalty: Provided, however, That a return
filed showing an overpayment shall be considered as a written claim for credit or refund.
xxxx
Sec. 229. Recovery of Tax Erroneously or Illegally Collected. – No suit or proceeding shall be
maintained in any court for the recovery of any national internal revenue tax hereafter alleged to
have been erroneously or illegally assessed or collected, or of any penalty claimed to have been
collected without authority, of any sum alleged to have been excessively or in any manner wrongfully
collected without authority, or of any sum alleged to have been excessively or in any manner
wrongfully collected, until a claim for refund or credit has been duly filed with the Commissioner; but
such suit or proceeding may be maintained, whether or not such tax, penalty, or sum has been paid
under protest or duress.
In any case, no such suit or proceeding shall be filed after the expiration of two (2) years from the
date of payment of the tax or penalty regardless of any supervening cause that may arise after
payment: Provided, however, That the Commissioner may, even without a written claim therefor,
refund or credit any tax, where on the face of the return upon which payment was made, such
payment appears clearly to have been erroneously paid.
Notably, the above provisions also set a two-year prescriptive period, reckoned from date of
payment of the tax or penalty, for the filing of a claim of refund or tax credit. Notably too, both
provisions apply only to instances of erroneous payment or illegal collection of internal
revenue taxes.
MPC’s creditable input VAT not erroneously paid
For perspective, under Sec. 105 of the NIRC, creditable input VAT is an indirect tax which can be
shifted or passed on to the buyer, transferee, or lessee of the goods, properties, or services of the
taxpayer. The fact that the subsequent sale or transaction involves a wholly-tax exempt client,
resulting in a zero-rated or effectively zero-rated transaction, does not, standing alone, deprive the
taxpayer of its right to a refund for any unutilized creditable input VAT, albeit the erroneous, illegal,
or wrongful payment angle does not enter the equation.
xxxx
Considering the foregoing discussion, it is clear that Sec. 112 (A) of the NIRC, providing a two-
year prescriptive period reckoned from the close of the taxable quarter when the relevant
sales or transactions were made pertaining to the creditable input VAT, applies to the instant
case, and not to the other actions which refer to erroneous payment of taxes. 46 (Emphasis
supplied.)
In view of the foregoing, we find that the CTA En Banc erroneously applied Sections 114(A) and 229
of the NIRC in computing the two-year prescriptive period for claiming refund/credit of unutilized
input VAT. To be clear, Section 112 of the NIRC is the pertinent provision for the refund/credit of
input VAT. Thus, the two-year period should be reckoned from the close of the taxable quarter when
the sales were made.
The administrative claim was timely filed
Bearing this in mind, we shall now proceed to determine whether the administrative claim was timely
filed.
Relying on Article 13 of the Civil Code,47 which provides that a year is equivalent to 365 days, and
taking into account the fact that the year 2004 was a leap year, petitioner submits that the two-year
period to file a claim for tax refund/ credit for the period July 1, 2002 to September 30, 2002 expired
on September 29, 2004.48
We do not agree.
In Commissioner of Internal Revenue v. Primetown Property Group, Inc.,49 we said that as between
the Civil Code, which provides that a year is equivalent to 365 days, and the Administrative Code of
1987, which states that a year is composed of 12 calendar months, it is the latter that must prevail
following the legal maxim, Lex posteriori derogat priori. 50 Thus:
Both Article 13 of the Civil Code and Section 31, Chapter VIII, Book I of the Administrative Code of
1987 deal with the same subject matter – the computation of legal periods. Under the Civil Code, a
year is equivalent to 365 days whether it be a regular year or a leap year. Under the Administrative
Code of 1987, however, a year is composed of 12 calendar months. Needless to state, under the
Administrative Code of 1987, the number of days is irrelevant.
There obviously exists a manifest incompatibility in the manner of
computing legal periods under the Civil Code and the Administrative Code of 1987. For this reason,
we hold that Section 31, Chapter VIII, Book I of the Administrative Code of 1987, being the more
recent law, governs the computation of legal periods. Lex posteriori derogat priori.
Applying Section 31, Chapter VIII, Book I of the Administrative Code of 1987 to this case, the two-
year prescriptive period (reckoned from the time respondent filed its final adjusted return on April 14,
1998) consisted of 24 calendar months, computed as follows:
Year 1 1st calendar month April 15, 1998 to May 14, 1998
2nd calendar month May 15, 1998 to June 14, 1998
3rd calendar month June 15, 1998 to July 14, 1998
4th calendar month July 15, 1998 to August 14, 1998
5th calendar month August 15, 1998 to September 14, 1998
6th calendar month September 15, 1998 to October 14, 1998
7th calendar month October 15, 1998 to November 14, 1998
8th calendar month November 15, 1998 to December 14, 1998
9th calendar month December 15, 1998 to January 14, 1999
10th calendar month January 15, 1999 to February 14, 1999
11th calendar month February 15, 1999 to March 14, 1999
12th calendar month March 15, 1999 to April 14, 1999
Year 2 13th calendar month April 15, 1999 to May 14, 1999
14th calendar month May 15, 1999 to June 14, 1999
15th calendar month June 15, 1999 to July 14, 1999
16th calendar month July 15, 1999 to August 14, 1999
17th calendar month August 15, 1999 to September 14, 1999
18th calendar month September 15, 1999 to October 14, 1999
21st calendar month December 15, 1999 to January 14, 2000
22nd calendar month January 15, 2000 to February 14, 2000
23rd calendar month February 15, 2000 to March 14, 2000
We therefore hold that respondent's petition (filed on April 14, 2000) was filed on the last day of the
24th calendar month from the day respondent filed its final adjusted return. Hence, it was filed within
the reglementary period.51
Applying this to the present case, the two-year period to file a claim for tax refund/credit for the
period July 1, 2002 to September 30, 2002 expired on September 30, 2004. Hence, respondent’s
administrative claim was timely filed.
The filing of the judicial claim was premature
However, notwithstanding the timely filing of the administrative claim, we
are constrained to deny respondent’s claim for tax refund/credit for having been filed in violation of
Section 112(D) of the NIRC, which provides that:
xxxx
(D) Period within which Refund or Tax Credit of Input Taxes shall be Made. – In proper cases, the
Commissioner shall grant a refund or issue the tax credit certificate for creditable input taxes within
one hundred twenty (120) days from the date of submission of complete documents in support of the
application filed in accordance with Subsections (A) and (B) hereof.
In case of full or partial denial of the claim for tax refund or tax credit, or the failure on the part of the
Commissioner to act on the application within the period prescribed above, the taxpayer affected
may, within thirty (30) days from the receipt of the decision denying the claim or after the expiration
of the one hundred twenty day-period, appeal the decision or the unacted claim with the Court of Tax
Appeals. (Emphasis supplied.)
Section 112(D) of the NIRC clearly provides that the CIR has "120 days, from the date of the
submission of the complete documents in support of the application [for tax refund/credit]," within
which to grant or deny the claim. In case of full or partial denial by the CIR, the taxpayer’s recourse
is to file an appeal before the CTA within 30 days from receipt of the decision of the CIR. However, if
after the 120-day period the CIR fails to act on the application for tax refund/credit, the remedy of the
taxpayer is to appeal the inaction of the CIR to CTA within 30 days.
In this case, the administrative and the judicial claims were simultaneously filed on September 30,
2004. Obviously, respondent did not wait for the decision of the CIR or the lapse of the 120-day
period. For this reason, we find the filing of the judicial claim with the CTA premature.
Respondent’s assertion that the non-observance of the 120-day period is not fatal to the filing of a
judicial claim as long as both the administrative and the judicial claims are filed within the two-year
prescriptive period52 has no legal basis.
There is nothing in Section 112 of the NIRC to support respondent’s view. Subsection (A) of the said
provision states that "any VAT-registered person, whose sales are zero-rated or effectively zero-
rated may, within two years after the close of the taxable quarter when the sales were made, apply
for the issuance of a tax credit certificate or refund of creditable input tax due or paid attributable to
such sales." The phrase "within two (2) years x x x apply for the issuance of a tax credit certificate or
refund" refers to applications for refund/credit filed with the CIR and not to appeals made to the CTA.
This is apparent in the first paragraph of subsection (D) of the same provision, which states that the
CIR has "120 days from the submission of complete documents in support of the application filed in
accordance with Subsections (A) and (B)" within which to decide on the claim.
In fact, applying the two-year period to judicial claims would render nugatory Section 112(D) of the
NIRC, which already provides for a specific period within which a taxpayer should appeal the
decision or inaction of the CIR. The second paragraph of Section 112(D) of the NIRC envisions two
scenarios: (1) when a decision is issued by the CIR before the lapse of the 120-day period; and (2)
when no decision is made after the 120-day period. In both instances, the taxpayer has 30 days
within which to file an appeal with the CTA. As we see it then, the 120-day period is crucial in filing
an appeal with the CTA.
With regard to Commissioner of Internal Revenue v. Victorias Milling, Co., Inc.53 relied upon by
respondent, we find the same inapplicable as the tax provision involved in that case is Section 306,
now Section 229 of the NIRC. And as already discussed, Section 229 does not apply to
refunds/credits of input VAT, such as the instant case.
In fine, the premature filing of respondent’s claim for refund/credit of input VAT before the CTA
warrants a dismissal inasmuch as no jurisdiction was acquired by the CTA.
WHEREFORE, the Petition is hereby GRANTED. The assailed July 30, 2008 Decision and the
October 6, 2008 Resolution of the Court of Tax Appeals are hereby REVERSED and SET ASIDE.
The Court of Tax Appeals Second Division is DIRECTED to dismiss CTA Case No. 7065 for having
been prematurely filed.
SO ORDERED.
G.R. No. 183994 June 30, 2014
WILLIAM CO a.k.a. XU QUING HE, Petitioner,

vs.
NEW PROSPERITY PLASTIC PRODUCTS, represented by ELIZABETH UY, Respondent. 1
DECISION
PERALTA, J.:
Assailed in this petition for review on certiorari under Rule 45 of the 1997 Revised Rules on Civil
Procedure (Rules) are the April 30, 2008 and August 1, 2008 Resolutions of the Court of Appeals
2 3
(CA) in CA-G.R. SP No. 102975, which dismissed the petition and denied the motion for
reconsideration, respectively. In effect, the CA affirmed the January 28, 2008 Decision of the
4
Regional Trial Court (RTC) Branch 121 of Caloocan City, which annulled and set aside the Orders
dated September 4, 2006 and November 16, 2006 of the Metropolitan Trial Court (MeTC), Branch
5 6
50 of Caloocan City, permanently dismissing Criminal Case Nos. 206655-59, 206661-77 and
209634.
The facts are simple and undisputed:
Respondent New Prosperity Plastic Products, represented by Elizabeth Uy (Uy), is the private
complainant in Criminal Case Nos. 206655-59, 206661-77 and 209634 for Violation of Batas
Pambansa (B.P.) Bilang 22 filed against petitioner William Co (Co), which were raffled to the MeTC
Branch. 49 of Caloocan City. In the absence of Uy and the private counsel, the cases were
provisionally dismissed on June 9, 2003 in open court pursuant to Section 8, Rule 117 of the
Revised Rules of Criminal Procedure (Rules). Uy received a copy of the June9, 2003 Order on July
7
2, 2003, while her counsel-of-record received a copy a day after. On July 2, 2004, Uy, through
8
counsel, filed a Motion to Revive the Criminal Cases. Hon. Belen B. Ortiz, then Presiding Judge of
9
the MeTC Branch 49, granted the motion on October 14, 2004 and denied Co’s motion for
reconsideration. When Co moved for recusation, Judge Ortiz inhibited herself from handling the
10
criminal cases per Order dated January 10, 2005. The cases were, thereafter, raffled to the MeTC
11
Branch 50 of Caloocan City. On March 17, 2005, Co filed a petition for certiorari and prohibition with
prayer for the issuance of a temporary restraining order (TRO)/writ of preliminary injunction (WPI)
before the RTC of Caloocan City challenging the revival of the criminal cases. It was, however,
12
dismissed for lack of merit on May 23, 2005. Co’s motion for reconsideration was, subsequently,
13
denied on December 16, 2005. Co then filed a petition for review on certiorari under Rule 45 before
14
the Supreme Court, which was docketed as G.R. No. 171096. We dismissed the petition per
15
Resolution dated February 13, 2006. There being no motion for reconsideration filed, the dismissal
16
became final and executory on March 20, 2006. 17
Before the MeTC Branch 50 where Criminal Case Nos. 206655-59, 206661-77 and 209634 were re-
raffled after the inhibition of Judge Ortiz, Co filed a "Motion for Permanent Dismissal" on July 13,
2006. Uy opposed the motion, contending that the motion raised the same issues already resolved
18
with finality by this Court in G.R. No. 171096. In spite of this, Judge Esteban V. Gonzaga issued an
19
Order dated September 4, 2006 granting Co’s motion. When the court subsequently denied Uy’s
20
motion for reconsideration on November 16, 2006, Uy filed a petition for certiorari before the RTC of
21
Caloocan City. On January 28, 2008, Hon. Judge Adoracion G. Angeles of the RTC Branch 121
acted favorably on the petition, annulling and setting aside the Orders dated September 4, 2006 and
November 16, 2006 and directing the MeTC Branch 50 to proceed with the trial of the criminal
cases. Co then filed a petition for certiorari before the CA, which, as aforesaid, dismissed the
22
petition and denied his motion for reconsideration. Hence, this present petition with prayer for
TRO/WPI.
According to Co, the following issues need to be resolved in this petition:
1. WHETHER OR NOT THE DISMISSAL OF THE CRIMINAL CASES AGAINST

PETITIONER ONTHE GROUND OF DENIAL OF HIS RIGHT TO SPEEDY TRIAL
CONSTITUTES FINAL DISMISSAL OF THESE CASES;
2. WHETHER OR NOT THE METC ACTED WITH JURISDICTION IN REVIVING THE

CRIMINAL CASES AGAINST PETITIONER WHICH WERE DISMISSED ON THE GROUND
OF DENIAL OF HIS RIGHT TO SPEEDY TRIAL; and
3. ASSUMING POR GRATIA ARGUMENTITHE CASES WERE ONLY PROVISIONALLY

DISMISSED:
a. WHETHER THE ONE-YEAR TIMEBAR OF THEIR REVIVAL IS COMPUTED

FROM ISSUANCE OF THE ORDER OF PROVISIONAL DISMISSAL;
b. WHETHER THE ACTUAL NUMBER OF DAYS IN A YEAR IS THE BASIS FOR

COMPUTING THE ONE-YEAR TIME BAR;
c. WHETHER THE PROVISIONALLY DISMISSED CASES AGAINST PETITIONER

ARE REVIVED IPSO FACTO BY THE FILING OF MOTION TO REVIVE THESE
CASES. 23
Co argues that the June 9, 2003 Order provisionally dismissing Criminal Case Nos. 206655-59,
206661-77 and 209634 should be considered as a final dismissal on the ground that his right to
speedy trial was denied. He reasons out that from his arraignment on March 4, 2002 until the initial
trial on June 9, 2003, there was already a "vexatious, capricious and oppressive" delay, which is in
violation of Section 6 of Republic Act 8493 (Speedy Trial Act of 1998) and Section 2, Paragraph 2,
24
Rule 119 of the Revised Rules of Criminal Procedure mandating that the entire trial period should
25
not exceed 180 days from the first day of trial. As the dismissal is deemed final, Co contends that the
MeTC lost its jurisdiction over the cases and cannot reacquire jurisdiction over the same based on a
mere motion because its revival would already put him in double jeopardy.
Assuming that the criminal cases were only provisionally dismissed, Co further posits that such
dismissal became permanent one year after the issuance of the June 9, 2003 Order, not after notice
to the offended party. He also insists that both the filing of the motion to revive and the trial court’s
issuance of the order granting the revival must be within the one-year period. Lastly, even assuming
that the one-year period to revive the criminal cases started on July 2, 2003 when Uy received the
June 9, 2003 Order, Co asserts that the motion was filed one day late since year 2004 was a leap
year.
The petition is unmeritorious.
At the outset, it must be noted that the issues raised in this petition were also the meat of the
controversy in Co’s previous petition in G.R. No. 171096, which We dismissed per Resolution dated
February 13, 2006. Such dismissal became final and executory on March 20, 2006. While the first
petition was dismissed mainly due to procedural infirmities, this Court nonetheless stated therein that
"[i]n any event, the petition lacks sufficient showing that respondent court had committed any
reversible error in the questioned judgment to warrant the exercise by this Court of its discretionary
appellate jurisdiction in this case." Hence, upon the finality of Our February 13, 2006 Resolution in
G.R. No. 171096, the same already constitutes as res judicata between the parties. On this ground
alone, this petition should have been dismissed outright.
Even if We are to squarely resolve the issues repeatedly raised in the present petition, Co’s
arguments are nonetheless untenable on the grounds as follows:
First, Co’s charge that his right to a speedy trial was violated is baseless. Obviously, he failed to
show any evidence that the alleged "vexatious, capricious and oppressive" delay in the trial was
attended with malice or that the same was made without good cause or justifiable motive on the part
of the prosecution. This Court has emphasized that "‘speedy trial’ is a relative term and necessarily a
flexible concept." In determining whether the accused's right to speedy trial was violated, the delay
26
should be considered in view of the entirety of the proceedings. The factors to balance are the
27
following: (a) duration of the delay; (b) reason therefor; (c) assertion of the right or failure to assert it;
and (d) prejudice caused by such delay. Surely, mere mathematical reckoning of the time involved
28
would not suffice as the realities of everyday life must be regarded in judicial proceedings which,
after all, do not exist in a vacuum, and that particular regard must be given to the facts and
circumstances peculiar to each case. "While the Court recognizes the accused's right to speedy trial
29
and adheres to a policy of speedy administration of justice, we cannot deprive the State of a
reasonable opportunity to fairly prosecute criminals. Unjustified postponements which prolong the
trial for an unreasonable length of time are what offend the right of the accused to speedy trial." 30
Second, Co is burdened to establish the essential requisites of the first paragraph of Section 8, Rule
117 of the Rules, which are conditions sine qua non to the application of the time-bar in the second
paragraph thereof, to wit: (1) the prosecution with the express conformity of the accused or the
accused moves for a provisional (sin perjuicio) dismissal of the case; or both the prosecution and the
accused move for a provisional dismissal of the case; (2) the offended party is notified of the motion
for a provisional dismissal of the case; (3) the court issues an order granting the motion and
dismissing the case provisionally; and (4) the public prosecutor is served with a copy of the order of
provisional dismissal of the case. In this case, it is apparent from the records that there is no notice
31
of any motion for the provisional dismissal of Criminal Cases Nos. 206655-59, 206661-77 and
209634 or of the hearing thereon which was served on the private complainant at least three days
before said hearing as mandated by Section 4, Rule 15 of the Rules. The fact is that it was only in
32
open court that Co moved for provisional dismissal "considering that, as per records, complainant
had not shown any interest to pursue her complaint." The importance of a prior notice to the
33
offended party of a motion for provisional dismissal is aptly explained in People v. Lacson: 34
x x x It must be borne in mind that in crimes involving private interests, the new rule requires that the
offended party or parties or the heirs of the victims must be given adequate a priori notice of any
motion for the provisional dismissal of the criminal case. Such notice may be served on the offended
party or the heirs of the victim through the private prosecutor, if there is one, or through the public
prosecutor who in turn must relay the notice to the offended party or the heirs of the victim to enable
them to confer with him before the hearing or appear in court during the hearing. The proof of such
service must be shown during the hearing on the motion, otherwise, the requirement of the new rule
will become illusory. Such notice will enable the offended party or the heirs of the victim the
opportunity to seasonably and effectively comment on or object to the motion on valid grounds,
including: (a) the collusion between the prosecution and the accused for the provisional dismissal of
a criminal case thereby depriving the State of its right to due process; (b) attempts to make
witnesses unavailable; or (c) the provisional dismissal of the case with the consequent release of the
accused from detention would enable him to threaten and kill the offended party or the other
prosecution witnesses or flee from Philippine jurisdiction, provide opportunity for the destruction or
loss of the prosecution’s physical and other evidence and prejudice the rights of the offended party
to recover on the civil liability of the accused by his concealment or furtive disposition of his property
or the consequent lifting of the writ of preliminary attachment against his property. 35
Third, there is evident want of jurisprudential support on Co’s supposition that the dismissal of the
cases became permanent one year after the issuance of the June 9, 2003 Order and not after notice
to the offended party. When the Rules states that the provisional dismissal shall become permanent
one year after the issuance of the order temporarily dismissing the case, it should not be literally
interpreted as such. Of course, there is a vital need to satisfy the basic requirements of due process;
thus, said in one case:
Although the second paragraph of the new rule states that the order of dismissal shall become
permanent one year after the issuance thereof without the case having been revived, the provision
should be construed to mean that the order of dismissal shall become permanent one year after
service of the order of dismissal on the public prosecutor who has control of the prosecution without
the criminal case having been revived. The public prosecutor cannot be expected to comply with the
timeline unless he is served with a copy of the order of dismissal. 36
We hasten to add though that if the offended party is represented by a private counsel the better rule
is that the reckoning period should commence to run from the time such private counsel was actually
notified of the order of provisional dismissal. When a party is represented by a counsel, notices of all
kinds emanating from the court should be sent to the latter at his/her given address. Section 2, Rule
37
13 of the Rules analogously provides that if any party has appeared by counsel, service upon the
former shall be made upon the latter. 38
Fourth, the contention that both the filing of the motion to revive the case and the court order reviving
it must be made prior to the expiration of the one-year period is unsustainable. Such interpretation is
not found in the Rules. Moreover, to permit otherwise would definitely put the offended party at the
mercy of the trial court, which may wittingly or unwittingly not comply. Judicial notice must be taken
of the fact that most, if not all, of our trial court judges have to deal with clogged dockets in addition
to their administrative duties and functions. Hence, they could not be expected to act at all times on
all pending decisions, incidents, and related matters within the prescribed period of time. It is
likewise possible that some of them, motivated by ill-will or malice, may simply exercise their whims
and caprices in not issuing the order of revival on time.
Fifth, the fact that year 2004 was a leap year is inconsequential to determine the timeliness of Uy’s
motion to revive the criminal cases. What is material instead is Co’s categorical admission that Uy is
represented by a private counsel who only received a copy of the June 9, 2003 Order on July 3,
2003. Therefore, the motion was not belatedly filed on July 2, 2004. Since the period for filing a
motion to revive is reckoned from the private counsel's receipt of the order of provisional dismissal, it
necessarily follows that the reckoning period for the permanent dismissal is likewise the private
counsel's date of receipt of the order of provisional dismissal.
And Sixth, granting for the sake of argument that this Court should take into account 2004 as a leap
year and that the one-year period to revive the case should be reckoned from the date of receipt of
the order of provisional dismissal by Uy, We still hold that the motion to revive the criminal cases
against Co was timely filed. A year is equivalent to 365 days regardless of whether it is a regular
year or a leap year. Equally so, under the Administrative Code of 1987, a yearis composed of 12
39
calendar months. The number of days is irrelevant. This was our ruling in Commissioner of Internal
Revenue v. Primetown Property Group, Inc., which was subsequently reiterated in Commissioner of
40
Internal Revenue v. Aichi Forging Company of Asia, Inc., thus:

41
x x x [In] 1987, EO 292 or the Administrative Code of 1987 was enacted. Section 31, Chapter VIII,
Book I thereof provides:
Sec. 31.Legal Periods.- "Year" shall be understood to be twelve calendar months; "month" of thirty
days, unless it refers to a specific calendar month in which case it shall be computed according to
the number of days the specific month contains; "day", to a day of twenty-four hours and; "night"
from sunrise to sunset. (emphasis supplied)
A calendar month is "a month designated in the calendar without regard to the number of days it
may contain." It is the "period of time running from the beginning of a certain numbered day up to,
but not including, the corresponding numbered day of the next month, and if there is not a sufficient
number of days in the next month, then up to and including the last day of that month." To illustrate,
one calendar month from December 31, 2007 will be from January 1, 2008 to January 31, 2008; one
calendar month from January 31, 2008 will be from February 1, 2008 until February 29, 2008. 42
Applying Section 31, Chapter VIII, Book I of the Administrative Code of 1987 to this case, the one-
year period reckoned from the time Uy received the order of dismissal on July2, 2003 consisted of
24 calendar months, computed as follows:
1st calendar month July 3, 2003 to August 2, 2003
2nd calendar month August 3, 2003 to September 2, 2003
3rd calendar month September 3, 2003 to October 2, 2003
6th calendar month December 3, 2003 to January 2, 2004
7th calendar month January 3, 2004 to February 2, 2004
8th calendar month February 3, 2004 to March 2, 2004

10th calendar month April 3, 2004 to May 2, 2004
11th calendar month May 3, 2004 to June 2, 2004
12th calendar month June 3, 2004 to July 2, 2004
In the end, We find it hard to disregard the thought that the instant petition was filed as a dilatory
tactic to prosecute Criminal Case Nos. 206655-59, 206661-77 and 209634. As correctly pointed out
by Uy since the time when the "Motion for Permanent Dismissal" was filed, the issues raised herein
were already resolved with finality by this Court in G.R. No. 171096. Verily, Co, acting through the
guidance and advice of his counsel, Atty. Oscar C. Maglaque, adopted a worthless and vexatious
legal maneuver for no purpose other than to delay the trial court proceedings. It appears that Atty.
Maglaque’s conduct contravened the Code of Professional Responsibility which enjoins lawyers to
observe the rules of procedure and not to misuse them to defeat the ends of justice (Rule 10.03,
Canon 10) as well as not to unduly delay a case or misuse court processes (Rule 12.04, Canon 12).
The Lawyer’s Oath also upholds in particular:
x x x I will not wittingly or willingly promote or sue any groundless, false or unlawful suit, nor give aid
nor consent to the same; I will delay no man for money or malice, and will conduct myself as a
lawyer according to the best of my knowledge and discretion with all good fidelity as well to the
courts as to my clients x x x.1âwphi1
This Court has repeatedly impressed upon counsels that the need for the prompt termination of
litigation is essential to an effective and efficient administration of justice. In Spouses Aguilar v.
Manila Banking Corporation, We said:
43
The Court reminds petitioners' counsel of the duty of lawyers who, as officers of the court, must see
to it that the orderly administration of justice must not be unduly impeded. It is the duty of a counsel
to advise his client, ordinarily a layman on the intricacies and vagaries of the law, on the merit or lack
of merit of his case. If he finds that his client's cause is defenseless, then it is his bounden duty to
advise the latter to acquiesce and submit, rather than traverse the incontrovertible. A lawyer must
resist the whims and caprices of his client, and temper his client's propensity to litigate. A lawyer’s
oath to uphold the cause of justice is superior to his duty to his client; its primacy is indisputable. 44
WHEREFORE, premises considered, the Petition is DENIED. The April 30, 2008 and August 1,
2008 Resolutions of the Court of Appeals, respectively, in CA-G.R. SP No. 102975, which affirmed
the January 28, 2008 Decision of the Regional Trial Court, Branch 121 of Caloocan City, annulling
and setting aside the Orders dated September 4, 2006 and November 16, 2006 of the Metropolitan
Trial Court, Branch 50 of Caloocan City that permanently dismissed Criminal Case Nos. 206655-59,
206661-77 and 209634, are hereby AFFIRMED. Costs of suit to be paid by the petitioner.
The Commission on Bar Discipline-Integrated Bar of the Philippines is DIRECTED to investigate

Atty. Oscar C. Maglaque for his acts that appear to have violated the Lawyer's Oath, the Code of
Professional Responsibility, and the Rule on Forum Shopping.
SO ORDERED.
G.R. No. L-68470 October 8, 1985
ALICE REYES VAN DORN, petitioner,

vs.
HON. MANUEL V. ROMILLO, JR., as Presiding Judge of Branch CX, Regional Trial Court of
the National Capital Region Pasay City and RICHARD UPTON respondents.
MELENCIO-HERRERA, J.:\
In this Petition for certiorari and Prohibition, petitioner Alice Reyes Van Dorn seeks to set aside the Orders, dated September 15, 1983 and
August 3, 1984, in Civil Case No. 1075-P, issued by respondent Judge, which denied her Motion to Dismiss said case, and her Motion for
Reconsideration of the Dismissal Order, respectively.
The basic background facts are that petitioner is a citizen of the Philippines while private respondent
is a citizen of the United States; that they were married in Hongkong in 1972; that, after the
marriage, they established their residence in the Philippines; that they begot two children born on
April 4, 1973 and December 18, 1975, respectively; that the parties were divorced in Nevada, United
States, in 1982; and that petitioner has re-married also in Nevada, this time to Theodore Van Dorn.
Dated June 8, 1983, private respondent filed suit against petitioner in Civil Case No. 1075-P of the
Regional Trial Court, Branch CXV, in Pasay City, stating that petitioner's business in Ermita, Manila,
(the Galleon Shop, for short), is conjugal property of the parties, and asking that petitioner be
ordered to render an accounting of that business, and that private respondent be declared with right
to manage the conjugal property. Petitioner moved to dismiss the case on the ground that the cause
of action is barred by previous judgment in the divorce proceedings before the Nevada Court
wherein respondent had acknowledged that he and petitioner had "no community property" as of
June 11, 1982. The Court below denied the Motion to Dismiss in the mentioned case on the ground
that the property involved is located in the Philippines so that the Divorce Decree has no bearing in
the case. The denial is now the subject of this certiorari proceeding.
Generally, the denial of a Motion to Dismiss in a civil case is interlocutory and is not subject to
appeal. certiorari and Prohibition are neither the remedies to question the propriety of an
interlocutory order of the trial Court. However, when a grave abuse of discretion was patently
committed, or the lower Court acted capriciously and whimsically, then it devolves upon this Court in
a certiorari proceeding to exercise its supervisory authority and to correct the error committed which,
in such a case, is equivalent to lack of jurisdiction. Prohibition would then lie since it would be
1
useless and a waste of time to go ahead with the proceedings. Weconsider the petition filed in this
2
case within the exception, and we have given it due course.
For resolution is the effect of the foreign divorce on the parties and their alleged conjugal property in
the Philippines.
Petitioner contends that respondent is estopped from laying claim on the alleged conjugal property
because of the representation he made in the divorce proceedings before the American Court that
they had no community of property; that the Galleon Shop was not established through conjugal
funds, and that respondent's claim is barred by prior judgment.
For his part, respondent avers that the Divorce Decree issued by the Nevada Court cannot prevail
over the prohibitive laws of the Philippines and its declared national policy; that the acts and
declaration of a foreign Court cannot, especially if the same is contrary to public policy, divest
Philippine Courts of jurisdiction to entertain matters within its jurisdiction.
For the resolution of this case, it is not necessary to determine whether the property relations
between petitioner and private respondent, after their marriage, were upon absolute or relative
community property, upon complete separation of property, or upon any other regime. The pivotal
fact in this case is the Nevada divorce of the parties.
The Nevada District Court, which decreed the divorce, had obtained jurisdiction over petitioner who
appeared in person before the Court during the trial of the case. It also obtained jurisdiction over
private respondent who, giving his address as No. 381 Bush Street, San Francisco, California,
authorized his attorneys in the divorce case, Karp & Gradt Ltd., to agree to the divorce on the ground
of incompatibility in the understanding that there were neither community property nor community
obligations. As explicitly stated in the Power of Attorney he executed in favor of the law firm of
3
KARP & GRAD LTD., 336 W. Liberty, Reno, Nevada, to represent him in the divorce proceedings:
xxx xxx xxx
You are hereby authorized to accept service of Summons, to file an Answer, appear
on my behalf and do an things necessary and proper to represent me, without further
contesting, subject to the following:
1. That my spouse seeks a divorce on the ground of incompatibility.
2. That there is no community of property to be adjudicated by the Court.
3. 'I'hat there are no community obligations to be adjudicated by the court.
xxx xxx xxx 4
There can be no question as to the validity of that Nevada divorce in any of the States of the United
States. The decree is binding on private respondent as an American citizen. For instance, private
respondent cannot sue petitioner, as her husband, in any State of the Union. What he is contending
in this case is that the divorce is not valid and binding in this jurisdiction, the same being contrary to
local law and public policy.
It is true that owing to the nationality principle embodied in Article 15 of the Civil Code, only
5
Philippine nationals are covered by the policy against absolute divorces the same being considered
contrary to our concept of public police and morality. However, aliens may obtain divorces abroad,
which may be recognized in the Philippines, provided they are valid according to their national
law. In this case, the divorce in Nevada released private respondent from the marriage from the
6
standards of American law, under which divorce dissolves the marriage. As stated by the Federal
Supreme Court of the United States in Atherton vs. Atherton, 45 L. Ed. 794, 799:
The purpose and effect of a decree of divorce from the bond of matrimony by a court
of competent jurisdiction are to change the existing status or domestic relation of
husband and wife, and to free them both from the bond. The marriage tie when thus
severed as to one party, ceases to bind either. A husband without a wife, or a wife
without a husband, is unknown to the law. When the law provides, in the nature of a
penalty. that the guilty party shall not marry again, that party, as well as the other, is
still absolutely freed from the bond of the former marriage.
Thus, pursuant to his national law, private respondent is no longer the husband of petitioner. He
would have no standing to sue in the case below as petitioner's husband entitled to exercise control
over conjugal assets. As he is bound by the Decision of his own country's Court, which validly
exercised jurisdiction over him, and whose decision he does not repudiate, he is estopped by his
own representation before said Court from asserting his right over the alleged conjugal property.
To maintain, as private respondent does, that, under our laws, petitioner has to be considered still
married to private respondent and still subject to a wife's obligations under Article 109, et. seq. of the
Civil Code cannot be just. Petitioner should not be obliged to live together with, observe respect and
fidelity, and render support to private respondent. The latter should not continue to be one of her
heirs with possible rights to conjugal property. She should not be discriminated against in her own
country if the ends of justice are to be served.
WHEREFORE, the Petition is granted, and respondent Judge is hereby ordered to dismiss the
Complaint filed in Civil Case No. 1075-P of his Court.
Without costs.
SO ORDERED.
Van Dorn v. Hon. Romillo, Jr.

G.R. No. L-68470, 8 October 1985
FACTS:
Alice Reyes Van Dorn (petitioner) is a citizen of the Philippines while Richard Upton (private
respondent) is a citizen of the United States. They were married in Hongkong in 1972 and after the
marriage; they established their residence in the Philippines. They begot two children born on April
4, 1973 and December 18, 1975, respectively. The parties were divorced in Nevada, United States
in 1982 and petitioner has re-married also in Nevada, this time to Theodore Van Dorn.
Dated June 8, 1983, private respondent filed suit against petitioner stating that petitioner’s business
in Ermita, Manila, (the Galleon Shop, for short), is conjugal property of the parties. Respondent
asked petitioner is ordered to render an accounting of that business, and that private respondent be
declared with right to manage the conjugal property. Petitioner moved to dismiss the case on the
ground that the cause of action is barred by previous judgment in the divorce proceedings before the
Nevada Court wherein respondent had acknowledged that he and petitioner had “no community
property” as of June 11, 1982. The Court denied the Motion to Dismiss in the mentioned case on the
ground that the property involved is located in the Philippines so that the Divorce Decree has no
bearing in the case.
ISSUE:
Whether or not the foreign divorce between the petitioner and private respondent in Nevada is
binding in the Philippines where petitioner is a Filipino citizen.
RULING:
There can be no question as to the validity of that Nevada divorce in any of the States of the United
States. The decree is binding on private respondent as an American citizen. Pursuant to his national
law, private respondent is no longer the husband of petitioner. He would have no standing to sue in
the case below as petitioner’s husband entitled to exercise control over conjugal assets. As he is
bound by the Decision of his own country’s Court, which validly exercised jurisdiction over him, and
whose decision he does not repudiate, he is estopped by his own representation before said Court
from asserting his right over the alleged conjugal property.
The Court held that owing to the nationality principle embodied in Article 15 of the Civil Code, only
Philippine nationals are covered by the policy against absolute divorces the same being considered
contrary to our concept of public police and morality. However, aliens may obtain divorces abroad,
which may be recognized in the Philippines, provided they are valid according to their national law.
In this case, the divorce in Nevada released private respondent from the marriage from the
standards of American law, under which divorce dissolves the marriage.
G. R. No. 183622 February 8, 2012
MEROPE ENRIQUEZ VDA. DE CATALAN, Petitioner,

vs.
LOUELLA A. CATALAN-LEE, Respondent.
RESOLUTION
SERENO, J.:
Before us is a Petition for Review assailing the Court of Appeals (CA) Decision and 1
Resolution regarding the issuance of letters of administration of the intestate estate of Orlando B.
2
Catalan.
The facts are as follows:
Orlando B. Catalan was a naturalized American citizen. After allegedly obtaining a divorce in the
United States from his first wife, Felicitas Amor, he contracted a second marriage with petitioner
herein.
On 18 November 2004, Orlando died intestate in the Philippines.
Thereafter, on 28 February 2005, petitioner filed with the Regional Trial Court (RTC) of Dagupan
City a Petition for the issuance of letters of administration for her appointment as administratrix of the
intestate estate of Orlando. The case was docketed as Special Proceedings (Spec. Proc.) No. 228.
On 3 March 2005, while Spec. Proc. No. 228 was pending, respondent Louella A. Catalan-Lee, one
of the children of Orlando from his first marriage, filed a similar petition with the RTC docketed as
Spec. Proc. No. 232.
The two cases were subsequently consolidated.
Petitioner prayed for the dismissal of Spec. Proc. No. 232 on the ground of litis pendentia,
considering that Spec. Proc. No. 228 covering the same estate was already pending.
On the other hand, respondent alleged that petitioner was not considered an interested person
qualified to file a petition for the issuance of letters of administration of the estate of Orlando. In
support of her contention, respondent alleged that a criminal case for bigamy was filed against
petitioner before Branch 54 of the RTC of Alaminos, Pangasinan, and docketed as Crim. Case No.
2699-A.
Apparently, Felicitas Amor filed a Complaint for bigamy, alleging that petitioner contracted a second
marriage to Orlando despite having been married to one Eusebio Bristol on 12 December 1959.
On 6 August 1998, the RTC had acquitted petitioner of bigamy. The trial court ruled that since the
3
deceased was a divorced American citizen, and since that divorce was not recognized under
Philippine jurisdiction, the marriage between him and petitioner was not valid.
Furthermore, it took note of the action for declaration of nullity then pending action with the trial court
in Dagupan City filed by Felicitas Amor against the deceased and petitioner. It considered the
pending action to be a prejudicial question in determining the guilt of petitioner for the crime of
bigamy.
Finally, the trial court found that, in the first place, petitioner had never been married to Eusebio
Bristol.
On 26 June 2006, Branch 70 of the RTC of Burgos, Pangasinan dismissed the Petition for the
issuance of letters of administration filed by petitioner and granted that of private respondent.
Contrary to its findings in Crim. Case No. 2699-A, the RTC held that the marriage between petitioner
and Eusebio Bristol was valid and subsisting when she married Orlando. Without expounding, it
reasoned further that her acquittal in the previous bigamy case was fatal to her cause. Thus, the trial
court held that petitioner was not an interested party who may file a petition for the issuance of
letters of administration.4
After the subsequent denial of her Motion for Reconsideration, petitioner elevated the matter to the
Court of Appeals (CA) via her Petition for Certiorari, alleging grave abuse of discretion on the part of
the RTC in dismissing her Petition for the issuance of letters of administration.
Petitioner reiterated before the CA that the Petition filed by respondent should have been dismissed
on the ground of litis pendentia. She also insisted that, while a petition for letters of administration
may have been filed by an "uninterested person," the defect was cured by the appearance of a real
party-in-interest. Thus, she insisted that, to determine who has a better right to administer the
decedent’s properties, the RTC should have first required the parties to present their evidence
before it ruled on the matter.
On 18 October 2007, the CA promulgated the assailed Decision. First, it held that petitioner
undertook the wrong remedy. She should have instead filed a petition for review rather than a
petition for certiorari. Nevertheless, since the Petition for Certiorari was filed within the fifteen-day
reglementary period for filing a petition for review under Sec. 4 of Rule 43, the CA allowed the
Petition and continued to decide on the merits of the case. Thus, it ruled in this wise:
As to the issue of litis pendentia, we find it not applicable in the case. For litis pendentia to be a
ground for the dismissal of an action, there must be: (a) identity of the parties or at least such as to
represent the same interest in both actions; (b) identity of rights asserted and relief prayed for, the
relief being founded on the same acts, and (c) the identity in the two cases should be such that the
judgment which may be rendered in one would, regardless of which party is successful, amount to
res judicata in the other. A petition for letters of administration is a special proceeding. A special
proceeding is an application or proceeding to establish the status or right of a party, or a particular
fact. And, in contrast to an ordinary civil action, a special proceeding involves no defendant or
respondent. The only party in this kind of proceeding is the petitioner of the applicant. Considering its
nature, a subsequent petition for letters of administration can hardly be barred by a similar pending
petition involving the estate of the same decedent unless both petitions are filed by the same person.
In the case at bar, the petitioner was not a party to the petition filed by the private respondent, in the
same manner that the latter was not made a party to the petition filed by the former. The first
element of litis pendentia is wanting. The contention of the petitioner must perforce fail.
Moreover, to yield to the contention of the petitioner would render nugatory the provision of the
Rules requiring a petitioner for letters of administration to be an "interested party," inasmuch as any
person, for that matter, regardless of whether he has valid interest in the estate sought to be
administered, could be appointed as administrator for as long as he files his petition ahead of any
other person, in derogation of the rights of those specifically mentioned in the order of preference in
the appointment of administrator under Rule 78, Section 6 of the Revised Rules of Court, which
provides:
x x x x x x x x x
The petitioner, armed with a marriage certificate, filed her petition for letters of administration. As a
spouse, the petitioner would have been preferred to administer the estate of Orlando B. Catalan.
However, a marriage certificate, like any other public document, is only prima facie evidence of the
facts stated therein. The fact that the petitioner had been charged with bigamy and was
acquitted has not been disputed by the petitioner. Bigamy is an illegal marriage committed by
contracting a second or subsequent marriage before the first marriage has been dissolved or before
the absent spouse has been declared presumptively dead by a judgment rendered in a proper
proceedings. The deduction of the trial court that the acquittal of the petitioner in the said
case negates the validity of her subsequent marriage with Orlando B. Catalan has not been
disproved by her. There was not even an attempt from the petitioner to deny the findings of
the trial court. There is therefore no basis for us to make a contrary finding. Thus, not being an
interested party and a stranger to the estate of Orlando B. Catalan, the dismissal of her petition for
letters of administration by the trial court is in place.
x x x x x x x x x
WHEREFORE, premises considered, the petition is DISMISSED for lack of merit. No

pronouncement as to costs.
SO ORDERED. (Emphasis supplied)

5
Petitioner moved for a reconsideration of this Decision. She alleged that the reasoning of the CA
6
was illogical in stating, on the one hand, that she was acquitted of bigamy, while, on the other hand,
still holding that her marriage with Orlando was invalid. She insists that with her acquittal of the crime
of bigamy, the marriage enjoys the presumption of validity.
On 20 June 2008, the CA denied her motion.
Hence, this Petition.
At the outset, it seems that the RTC in the special proceedings failed to appreciate the finding of the
RTC in Crim. Case No. 2699-A that petitioner was never married to Eusebio Bristol. Thus, the trial
court concluded that, because petitioner was acquitted of bigamy, it follows that the first marriage
with Bristol still existed and was valid. By failing to take note of the findings of fact on the
nonexistence of the marriage between petitioner and Bristol, both the RTC and CA held that
petitioner was not an interested party in the estate of Orlando.
Second, it is imperative to note that at the time the bigamy case in Crim. Case No. 2699-A was
dismissed, we had already ruled that under the principles of comity, our jurisdiction recognizes a
valid divorce obtained by a spouse of foreign nationality. This doctrine was established as early as
1985 in Van Dorn v. Romillo, Jr. wherein we said:
7
It is true that owing to the nationality principle embodied in Article 15 of the Civil Code, only
Philippine nationals are covered by the policy against absolute divorces[,] the same being
considered contrary to our concept of public policy and morality. However, aliens may obtain
divorces abroad, which may be recognized in the Philippines, provided they are valid
according to their national law. In this case, the divorce in Nevada released private
respondent from the marriage from the standards of American law, under which divorce
dissolves the marriage. xxx
We reiterated this principle in Llorente v. Court of Appeals, to wit:

8
In Van Dorn v. Romillo, Jr. we held that owing to the nationality principle embodied in Article 15 of
the Civil Code, only Philippine nationals are covered by the policy against absolute divorces, the
same being considered contrary to our concept of public policy and morality. In the same case, the
Court ruled that aliens may obtain divorces abroad, provided they are valid according to their
national law.
Citing this landmark case, the Court held in Quita v. Court of Appeals, that once proven that
respondent was no longer a Filipino citizen when he obtained the divorce from petitioner, the
ruling in Van Dorn would become applicable and petitioner could "very well lose her right to
inherit" from him.
In Pilapil v. Ibay-Somera, we recognized the divorce obtained by the respondent in his country, the
Federal Republic of Germany. There, we stated that divorce and its legal effects may be
recognized in the Philippines insofar as respondent is concerned in view of the nationality
principle in our civil law on the status of persons.
For failing to apply these doctrines, the decision of the Court of Appeals must be reversed. We hold
that the divorce obtained by Lorenzo H. Llorente from his first wife Paula was valid and
recognized in this jurisdiction as a matter of comity. xxx
Nonetheless, the fact of divorce must still first be proven as we have enunciated in Garcia v.
Recio, to wit:
9
Respondent is getting ahead of himself. Before a foreign judgment is given presumptive evidentiary
value, the document must first be presented and admitted in evidence. A divorce obtained abroad is
proven by the divorce decree itself. Indeed the best evidence of a judgment is the judgment itself.
The decree purports to be a written act or record of an act of an official body or tribunal of a foreign
country.
Under Sections 24 and 25 of Rule 132, on the other hand, a writing or document may be proven as a
public or official record of a foreign country by either (1) an official publication or (2) a copy thereof
attested by the officer having legal custody of the document. If the record is not kept in the
Philippines, such copy must be (a) accompanied by a certificate issued by the proper diplomatic or
consular officer in the Philippine foreign service stationed in the foreign country in which the record is
kept and (b) authenticated by the seal of his office.
The divorce decree between respondent and Editha Samson appears to be an authentic one issued
by an Australian family court. However, appearance is not sufficient; compliance with the
aforementioned rules on evidence must be demonstrated.
Fortunately for respondent's cause, when the divorce decree of May 18, 1989 was submitted in
evidence, counsel for petitioner objected, not to its admissibility, but only to the fact that it had not
been registered in the Local Civil Registry of Cabanatuan City. The trial court ruled that it was
admissible, subject to petitioner's qualification. Hence, it was admitted in evidence and accorded
weight by the judge. Indeed, petitioner's failure to object properly rendered the divorce decree
admissible as a written act of the Family Court of Sydney, Australia.
Compliance with the quoted articles (11, 13 and 52) of the Family Code is not necessary;
respondent was no longer bound by Philippine personal laws after he acquired Australian citizenship
in 1992. Naturalization is the legal act of adopting an alien and clothing him with the political and civil
rights belonging to a citizen. Naturalized citizens, freed from the protective cloak of their former
states, don the attires of their adoptive countries. By becoming an Australian, respondent severed
his allegiance to the Philippines and the vinculum juris that had tied him to Philippine personal laws.
Burden of Proving Australian Law
Respondent contends that the burden to prove Australian divorce law falls upon petitioner, because
she is the party challenging the validity of a foreign judgment. He contends that petitioner was
satisfied with the original of the divorce decree and was cognizant of the marital laws of Australia,
because she had lived and worked in that country for quite a long time. Besides, the Australian
divorce law is allegedly known by Philippine courts; thus, judges may take judicial notice of foreign
laws in the exercise of sound discretion.
We are not persuaded. The burden of proof lies with the "party who alleges the existence of a fact or
thing necessary in the prosecution or defense of an action." In civil cases, plaintiffs have the burden
of proving the material allegations of the complaint when those are denied by the answer; and
defendants have the burden of proving the material allegations in their answer when they introduce
new matters. Since the divorce was a defense raised by respondent, the burden of proving the
pertinent Australian law validating it falls squarely upon him.
It is well-settled in our jurisdiction that our courts cannot take judicial notice of foreign laws. Like any
1âwphi1
other facts, they must be alleged and proved. Australian marital laws are not among those matters
that judges are supposed to know by reason of their judicial function. The power of judicial notice
must be exercised with caution, and every reasonable doubt upon the subject should be resolved in
the negative. (Emphasis supplied)
It appears that the trial court no longer required petitioner to prove the validity of Orlando’s divorce
under the laws of the United States and the marriage between petitioner and the deceased. Thus,
there is a need to remand the proceedings to the trial court for further reception of evidence to
establish the fact of divorce.
Should petitioner prove the validity of the divorce and the subsequent marriage, she has the
preferential right to be issued the letters of administration over the estate. Otherwise, letters of
administration may be issued to respondent, who is undisputedly the daughter or next of kin of the
deceased, in accordance with Sec. 6 of Rule 78 of the Revised Rules of Court.
This is consistent with our ruling in San Luis v. San Luis, in which we said:
10
Applying the above doctrine in the instant case, the divorce decree allegedly obtained by Merry Lee
which absolutely allowed Felicisimo to remarry, would have vested Felicidad with the legal
personality to file the present petition as Felicisimo's surviving spouse. However, the records show
that there is insufficient evidence to prove the validity of the divorce obtained by Merry Lee
as well as the marriage of respondent and Felicisimo under the laws of the U.S.A. In Garcia v.
Recio, the Court laid down the specific guidelines for pleading and proving foreign law and divorce
judgments. It held that presentation solely of the divorce decree is insufficient and that proof of its
authenticity and due execution must be presented. Under Sections 24 and 25 of Rule 132, a writing
or document may be proven as a public or official record of a foreign country by either (1) an official
publication or (2) a copy thereof attested by the officer having legal custody of the document. If the
record is not kept in the Philippines, such copy must be (a) accompanied by a certificate issued by
the proper diplomatic or consular officer in the Philippine foreign service stationed in the foreign
country in which the record is kept and (b) authenticated by the seal of his office.
With regard to respondent's marriage to Felicisimo allegedly solemnized in California, U.S.A., she
submitted photocopies of the Marriage Certificate and the annotated text of the Family Law Act of
California which purportedly show that their marriage was done in accordance with the said law. As
stated in Garcia, however, the Court cannot take judicial notice of foreign laws as they must be
alleged and proved.
Therefore, this case should be remanded to the trial court for further reception of evidence
on the divorce decree obtained by Merry Lee and the marriage of respondent and Felicisimo.
(Emphasis supplied)
Thus, it is imperative for the trial court to first determine the validity of the divorce to ascertain the
rightful party to be issued the letters of administration over the estate of Orlando B. Catalan.
WHEREFORE, premises considered, the Petition is hereby PARTIALLY GRANTED. The Decision

dated 18 October 2007 and the Resolution dated 20 June 2008 of the Court of Appeals are
hereby REVERSED and SET ASIDE. Let this case be REMANDED to Branch 70 of the Regional
Trial Court of Burgos, Pangasinan for further proceedings in accordance with this Decision.
SO ORDERED.

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July 30, 1979

Petitioners base their petitions on the following arguments:

On June 16, 1958, this Court resolved: têñ.£îhqwâ£

As a general rule, upon the dissolution of a commercial partnership the succeeding

On the other hand, têñ.£îhqwâ£

xxx xxx xxx

2. A relation as an "officer of court" to the administration of justice involving thorough

3. A relation to clients in the highest degree fiduciary.

4. A relation to colleagues at the bar characterized by candor, fairness, and

The practice sought to be proscribed has the sanction of custom and offends no

xxx xxx xxx

be considered by a court of justice unless such custom is properly established by competent

... It is of the essence of a profession that it is practiced in a spirit of public service. A

Fernando, C.J. and Abad Santos, J., took no part.

COMMISSIONER OF INTERNAL REVENUE, Petitioner,

4. Petitioner’s alleged claim for refund is subject to administrative investigation by the

SEC. 112. Refunds or Tax Credits of Input Tax. –

Amount of Claimed Input VAT ₱ 3,891,123.82

Net Creditable Input VAT ₱ 3,850,103.45

Ruling of the CTA En Banc

We are not persuaded.

Section 114 of the 1997 NIRC, and We quote, to wit:

SEC. 114. Return and Payment of Value-added Tax. –

The petition has merit.

SEC. 112. Refunds or Tax Credits of Input Tax. –

SEC. 114. Return and Payment of Value-Added Tax. –

SEC. 229. Recovery of tax erroneously or illegally collected. –

MPC’s creditable input VAT not erroneously paid

The administrative claim was timely filed

There obviously exists a manifest incompatibility in the manner of

The filing of the judicial claim was premature

However, notwithstanding the timely filing of the administrative claim, we

G.R. No. 183994 June 30, 2014

WILLIAM CO a.k.a. XU QUING HE, Petitioner,

The facts are simple and undisputed:

became final and executory on March 20, 2006. 17

According to Co, the following issues need to be resolved in this petition:

1. WHETHER OR NOT THE DISMISSAL OF THE CRIMINAL CASES AGAINST

2. WHETHER OR NOT THE METC ACTED WITH JURISDICTION IN REVIVING THE

3. ASSUMING POR GRATIA ARGUMENTITHE CASES WERE ONLY PROVISIONALLY

a. WHETHER THE ONE-YEAR TIMEBAR OF THEIR REVIVAL IS COMPUTED

b. WHETHER THE ACTUAL NUMBER OF DAYS IN A YEAR IS THE BASIS FOR

c. WHETHER THE PROVISIONALLY DISMISSED CASES AGAINST PETITIONER

The petition is unmeritorious.

Internal Revenue v. Aichi Forging Company of Asia, Inc., thus:

1st calendar month July 3, 2003 to August 2, 2003

2nd calendar month August 3, 2003 to September 2, 2003

3rd calendar month September 3, 2003 to October 2, 2003

4th calendar month October 3, 2003 to November 2, 2003

5th calendar month November 3, 2003 to December 2, 2003

6th calendar month December 3, 2003 to January 2, 2004

7th calendar month January 3, 2004 to February 2, 2004

8th calendar month February 3, 2004 to March 2, 2004

10th calendar month April 3, 2004 to May 2, 2004

11th calendar month May 3, 2004 to June 2, 2004

12th calendar month June 3, 2004 to July 2, 2004

The Commission on Bar Discipline-Integrated Bar of the Philippines is DIRECTED to investigate

ALICE REYES VAN DORN, petitioner,

case within the exception, and we have given it due course.

xxx xxx xxx

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

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

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

xxx xxx xxx 4