irregularity that may cast doubt on the authenticity of these documents, it is our
RULE 128, Section 1 conclusion that the appellate court did not err in relying upon them.
G.R. No. 127240. March 27, 2000
ONG CHIA, petitioner, vs. REPUBLIC OF THE PHILIPPINES and THE
COURT OF APPEALS, respondents.
Naturalization; Evidence; Pleadings and Practice; Formal Offer of Evidence;
Judgments; The rule on formal offer of evidence (Rule 132, §34) is clearly not
applicable to a petition for naturalization; Decisions in naturalization proceedings are
not covered by the rule on res judicata.—Petitioner failed to note Rule 143 of the Rules
of Court which provides that—These rules shall not apply to land registration,
cadastral and election cases, naturalization and insolvency proceedings, and other cases
not herein provided for, except by analogy or in a suppletory character and whenever
practicable and convenient. (Emphasis added) Prescinding from the above, the rule on
formal offer of evidence (Rule 132, §34) now being invoked by petitioner is clearly not
applicable to the present case involving a petition for naturalization. The only instance
when said rules may be applied by analogy or suppletorily in such cases is when it is
“practicable and convenient.” That is not the case here, since reliance upon the
documents presented by the State for the first time on appeal, in fact, appears to be the
more practical and convenient course of action considering that decisions in
naturalization proceedings are not covered by the rule on res judicata. Consequently, a
final favorable judgment does not preclude the State from later on moving for a
revocation of the grant of naturalization on the basis of the same documents.
Same; Same; Same; Same; The reason for the rule prohibiting the admission of
evidence which has not been formally offered is to afford the opposite party the chance
to object to their admissibility.—Petitioner claims that as a result of the failure of the
State to present and formally offer its documentary evidence before the trial court, he
was denied the right to object against their authenticity, effectively depriving him of
his fundamental right to procedural due process. We are not persuaded. Indeed, the
reason for the rule prohibiting the admission of evidence which has not been formally
offered is to afford the opposite party the chance to object to their admissibility.
Petitioner cannot claim that he was deprived of the right to object to the authenticity of
the documents submitted to the appellate court by the State. He could have included
his objections, as he, in fact, did, in the brief he filed with the Court of Appeals.
Same; Same; Public Documents; Where a party fails to make a satisfactory showing
of any flaw or irregularity that may cast doubt on the authenticity of documents which
have been executed under oath, the court may rely on them.—The Court notes that
these documents—namely, the petition in SCN Case No. 031767, petitioner’s marriage
contract, the joint affidavit executed by him and his wife, and petitioner’s income tax
returns—are all public documents. As such, they have been executed under oath. They
are thus reliable. Sinoe petitioner failed to make a satisfactory showing of any flaw or
------------------------------------------------------------------------------------------------
This is a petition for review of the decision 1 of the Court of Appeals reversing the
decision of the Regional Trial Court, Branch 24, Koronadal, South Cotabato 2 admitting
petitioner Ong Chia to Philippine citizenship.
The facts are as follows:
Petitioner was born on January 1, 1923 in Amoy, China. In 1932, as a nine-year old
boy, he arrived at the port of Manila on board the vessel "Angking." Since then, he has
stayed in the Philippines where he found employment and eventually started his own
business, married a Filipina, with whom he had four children. On July 4, 1989, at the
age of 66, he filed a verified petition to be admitted as a Filipino citizen under C.A.
No. 473, otherwise known as the Revised Naturalization Law, as amended. Petitioner,
after stating his qualifications as required in §2, and lack of the disqualifications
enumerated in §3 of the law, stated —
17. That he has heretofore made (a) petition for citizenship under the provisions of
Letter of Instruction No. 270 with the Special Committee on Naturalization, Office of
the Solicitor General, Manila, docketed as SCN Case No. 031776, but the same was
not acted upon owing to the fact that the said Special Committee on Naturalization was
not reconstituted after the February, 1986 revolution such that processing of petitions
for naturalization by administrative process was suspended;
During the hearings, petitioner testified as to his qualifications and presented three
witnesses to corroborate his testimony. So impressed was Prosecutor Isaac Alvero V.
Moran with the testimony of petitioner that, upon being asked by the court whether the
State intended to present any witness present any witness against him, he remarked:
Actually, Your Honor, with the testimony of the petitioner himself which is rather
surprising, in the sense that he seems to be well-versed with the major portion of the
history of the Philippines, so, on our part, we are convinced, Your Honor Please, that
petitioner really deserves to be admitted as a citizen of the Philippines. And for this
reason, we do not wish to present any evidence to counteract or refute the testimony of
the witnesses for the petitioner, as well as the petitioner himself.3
Accordingly, on August 25, 1999, the trial court granted the petition and admitted
petitioner to Philippine citizenship. The State, however, through the Office of the
Solicitor General, appealed all the names by which he is or had been known; (2) failed
to state all his former placer of residence in violation of C.A. No. 473, §7; (3) failed to
conduct himself in a proper and irreproachable manner during his entire stay in the
Philippines, in violation of §2; (4) has no known lucrative trade or occupation and his
1
previous incomes have been insufficient or misdeclared, also in contravention of §2;
and (5) failed to support his petition with the appropriate documentary evidence. 4
Annexed to the State's appellant's brief was a copy of a 1977 petition for naturalization
filed by petitioner with the Special Committee on Naturalization in SCN Case No.
031767,5 in which petitioner stated that in addition to his name of "Ong Chia," he had
likewise been known since childhood as "Loreto Chia Ong." As petitioner, however,
failed to state this other name in his 1989 petition for naturalization, it was contended
that his petition must fail. 6 The state also annexed income tax returns 7 allegedly filed by
petitioner from 1973 to 1977 to show that his net income could hardly support himself
and his family. To prove that petitioner failed to conduct himself in a proper and
irreproachable manner during his stay in the Philippines, the State contended that,
although petitioner claimed that he and Ramona Villaruel had been married twice,
once before a judge in 1953, and then again in church in 1977, petitioner actually lived
with his wife without the benefit of marriage from 1953 until they were married in
1977. It was alleged that petitioner failed to present his 1953 marriage contract, if there
be any. The State also annexed a copy of petitioner's 1977 marriage contract 8 and a
Joint-Affidavit9 executed by petitioner and his wife. These documents show that when
petitioner married Ramona Villaruel on February 23, 1977, no marriage license had
been required in accordance with Art. 76 of the Civil Code because petitioner and
Ramona Villaruel had been living together as husband and wife since 1953 without the
benefit of marriage. This, according to the State, belies his claim that when he started
living with his wife in 1953, they had already been married.
The State also argued that, as shown by petitioner's Immigrant Certificate of
Residence, 10 petitioner resided at "J.M. Basa Street, Iloilo," but he did not include said
address in the petition.
On November 15, 1996, the Court of Appeals rendered its decision which, as already
noted, reversed the trial court and denied petitioner's application for naturalization. It
ruled that due to the importance naturalization cases, the State is not precluded from
raising questions not presented in the lower court and brought up for the first time on
appeal. 11 The appellate court held:
As correctly observed by the Office of the Solicitor General, petitioner Ong Chia failed
to state in this present petition for naturalization his other name, "LORETO CHIA
ONG," which name appeared in his previous application under Letter of Instruction
No. 270. Names and pseudonyms must be stated in the petition for naturalization and
failure to include the same militates against a decision in his favor. . . This is a
mandatory requirement to allow those persons who know (petitioner) by those other
names to come forward and inform the authorities of any legal objection which might
adversely affect his application for citizenship.
Furthermore, Ong Chia failed to disclose in his petition for naturalization that he
formerly resided in "J.M. Basa St., Iloilo" and "Alimodian, Iloilo." Section 7 of the
Revised Naturalization Law requires the applicant to state in his petition "his present
and former places of residence." This requirement is mandatory and failure of the
petitioner to comply with it is fatal to the petition. As explained by the Court, the
reason for the provision is to give the public, as well as the investigating agencies of
the government, upon the publication of the petition, an opportunity to be informed
thereof and voice their objections against the petitioner. By failing to comply with this
provision, the petitioner is depriving the public and said agencies of such opportunity,
thus defeating the purpose of the law. . .
Ong Chia had not also conducted himself in a proper and irreproachable manner when
he lived-in with his wife for several years, and sired four children out of wedlock. It
has been the consistent ruling that the "applicant's 8-year cohabitation with his wife
without the benefit of clergy and begetting by her three children out of wedlock is a
conduct far from being proper and irreproachable as required by the Revised
Naturalization Law", and therefore disqualifies him from becoming a citizen of the
Philippines by naturalization . . .
Lastly, petitioner Ong Chia's alleged annual income in 1961 of P5,000.00, exclusive of
bonuses, commissions and allowances, is not lucrative income. His failure to file an
income tax return "because he is not liable for income tax yet" confirms that his
income is low. . . "It is not only that the person having the employment gets enough for
his ordinary necessities in life. It must be shown that the employment gives one an
income such that there is an appreciable margin of his income over expenses as to be
able to provide for an adequate support in the event of unemployment, sickness, or
disability to work and thus avoid one's becoming the object of charity or public
charge." . . . Now that they are in their old age, petitioner Ong Chia and his wife are
living on the allowance given to them by their children. The monthly pension given by
the elder children of the applicant cannot be added to his income to make it lucrative
because like bonuses, commissions and allowances, said pensions are contingent,
speculative and precarious. . .
Hence, this petition based on the following assignment of errors:
I. THE COURT OF APPEALS GRAVELY ABUSED ITS DISCRETION IN
RULING THAT IN NATURALIZATION CASES, THE APPELLATE COURT CAN
DENY AN APPLICATION FOR PHILIPPINE CITIZENSHIP ON THE BASIS OF
DOCUMENTS NOT PRESENTED BEFORE THE TRIAL COURT AND NOT
FORMING PART OF THE RECORDS OF THE CASE.
II. THE FINDING OF THE COURT OF APPEALS THAT THE PETITIONER HAS
BEEN KNOWN BY SOME OTHER NAME NOT STATED IN HIS PETITION IS
NOT SUPPORTED BY THE EVIDENCE ON RECORD.
2
III. CONTRARY TO THE FINDING OF THE COURT OF APPEALS, THE
PETITIONER STATED IN HIS PETITION AND ITS ANNEXES HIS PRESENT
AND FORMER PLACES OF RESIDENCE.
IV. THE FINDING OF THE COURT OF APPEALS THAT THE PETITIONER
FAILED TO CONDUCT HIMSELF IN A PROPER AND IRREPROACHABLE
MANNER IS NOT SUPPORTED BY THE EVIDENCE ON RECORD.
Petitioner's principal contention is that the appellate court erred in considering the
documents which had merely been annexed by the State to its appellant's brief and, on
the basis of which, justified the reversal of the trial court's decision. Not having been
presented and formally offered as evidence, they are mere "scrap(s) of paper devoid of
any evidentiary value," 12 so it was argued, because under Rule 132, §34 of the Revised
Rules on Evidence, the court shall consider no evidence which has not been formally
offered.
The contention has no merit. Petitioner failed to note Rule 143 13 of the Rules of Court
which provides that —
These rules shall not apply to land registration, cadastral and election
cases, naturalization and insolvency proceedings, and other cases not herein provided
for, except by analogy or in a suppletory character and whenever practicable and
convenient. (Emphasis added).
Prescinding from the above, the rule on formal offer of evidence (Rule 132, §34) now
being invoked by petitioner is clearly not applicable to the present case involving a
petition for naturalization. The only instance when said rules may be applied by
analogy or suppletorily in such cases is when it is "practicable and convenient." That is
not the case here, since reliance upon the documents presented by the State for the first
time on appeal, in fact, appears to be the more practical and convenient course of
action considering that decisions in naturalization proceedings are not covered by the
rule on res judicata. 14 Consequently, a final favorable judgment does not preclude the
State from later on moving for a revocation of the grant of naturalization on the basis
of the same documents.
Petitioner claims that as a result of the failure of the State to present and formally offer
its documentary evidence before the trial court, he was denied the right to object
against their authenticity, effectively depriving him of his fundamental right to
procedural due process. 15 We are not persuaded. Indeed, the reason for the rule
prohibiting the admission of evidence which has not been formally offered is to afford
the opposite party the chance to object to their admissibility. 16 Petitioner cannot claim
that he was deprived of the right to object to the authenticity of the documents
submitted to the appellate court by the State. He could have included his objections, as
he, in fact, did, in the brief he filed with the Court of Appeals. thus:
The authenticity of the alleged petition for naturalization (SCN Case No. 031767)
which was supposedly filed by Ong Chia under LOI 270 has not been established. In
fact, the case number of the alleged petition for naturalization. . . is 031767 while the
case number of the petition actually filed by the appellee is 031776. Thus, said
document is totally unreliable and should not be considered by the Honorable Court in
resolving the instant appeal. 17
Indeed, the objection is flimsy as the alleged discrepancy is trivial, and, at most, can be
accounted for as a typographical error on the part of petitioner himself. That "SCN
Case No. 031767," a copy of which was annexed to the petition, is the correct case
number is confirmed by the Evaluation Sheet 18 of the Special Committee on
Naturalization which was also docketed as "SCN Case No. 031767." Other than this,
petitioner offered no evidence to disprove the authenticity of the documents presented
by the State.
Furthermore, the Court notes that these documents — namely, the petition in SCN
Case No. 031767, petitioner's marriage contract, the joint affidavit executed by him
and his wife, and petitioner's income tax returns — are all public documents. As such,
they have been executed under oath. They are thus reliable. Since petitioner failed to
make a satisfactory showing of any flaw or irregularity that may cast doubt on the
authenticity of these documents, it is our conclusion that the appellate court did not err
in relying upon them.
One last point. The above discussion would have been enough to dispose of this case,
but to settle all the issues raised, we shall briefly discuss the effect of petitioner's
failure to include the address "J.M. Basa St., Iloilo" in his petition, in accordance with
§7, C.A. No. 473. This address appears on petitioner's Immigrant Certificate of
Residence, a document which forms part of the records as Annex A of his 1989
petition for naturalization. Petitioner admits that he failed to mention said address in
his petition, but argues that since the Immigrant Certificate of Residence containing it
had been fully published, 19 with the petition and the other annexes, such publication
constitutes substantial compliance with §7. 20 This is allegedly because the publication
effectively satisfied the objective sought to be achieved by such requirement, i.e., to
give investigating agencies of the government the opportunity to check on the
background of the applicant and prevent suppression of information regarding any
possible misbehavior on his part in any community where he may have lived at one
time or another. 21 It is settled, however, that naturalization laws should be rigidly
enforced and strictly construed in favor of the government and against the
applicant. 22 As noted by the State, C.A. No. 473, §7 clearly provides that the applicant
for naturalization shall set forth in the petition his present and former places of
residence. 23 This provision and the rule of strict application of the law in naturalization
cases defeat petitioner's argument of "substantial compliance" with the requirement
3
under the Revised Naturalization Law. On this ground alone, the instant petition ought
to be denied.
WHEREFORE, the decision of the Court of Appeals is AFFIRMED and the instant
petition is hereby DENIED.
SO ORDERED.
G.R. Nos. 140538-39. June 14, 2004.
PEOPLE OF THE PHILIPPINES, appellee, vs. GODOFREDO B. ADOR and
DIOSDADO B. ADOR III, appellants.
Criminal Law; Murder; Evidence; Circumstantial evidence may be the basis of a
conviction so long as the combination of all the circumstances proven produces a
logical conclusion which suffices to establish the guilt of the accused beyond
reasonable doubt; Requisites to sustain the conviction of an accused through
circumstantial evidence.—The rules of evidence allow the courts to rely on
circumstantial evidence to support its conclusion of guilt. It may be the basis of a
conviction so long as the combination of all the circumstances proven produces a
logical conclusion which suffices to establish the guilt of the accused beyond
reasonable doubt. All the circumstances must be consistent with each other, consistent
with the theory that all the accused are guilty of the offense charged, and at the same
time inconsistent with the hypothesis that they are innocent and with every other
possible, rational hypothesis except that of guilt. The evidence must exclude each and
every hypothesis which may be consistent with their innocence. Also, it should be
acted on and weighed with great caution. Circumstantial evidence which has not been
adequately established, much less corroborated, cannot by itself be the basis of
conviction. Thus, for circumstantial evidence to suffice, (1) there should be more than
one circumstance; (2) the facts from which the inferences are derived are proven; and
(3) the combination of all the circumstances is such as to produce a conviction beyond
reasonable doubt.
Same; Same; Same; Guidelines in appreciating circumstantial evidence.—Guidelines
in appreciating circumstantial evidence: (1) it should be acted upon with caution; (2)
all the essential facts must be consistent with the hypothesis of guilt; (3) the facts must
exclude every theory but that of guilt; and (4) the facts must establish such a certainty
of guilt of the accused as to convince the judgment beyond a reasonable doubt that the
accused is the one who committed the offense.
Same; Same; Same; Denial; The doctrine that the defense of denial cannot prevail over
positive identification of the accused must yield to the constitutional presumption of
innocence; The rule in criminal law is firmly entrenched that verdicts of conviction
must be predicated on the strength of the evidence for the prosecution and not on the
weakness of the evidence for the defense.—Both Diosdado III and Godofredo denied
the charges hurled against them. But, while it is true that alibi and denial are the
weakest of the defenses as they can easily be fabricated, absent such clear and positive
identification, the doctrine that the defense of denial cannot prevail over positive
identification of the accused must yield to the constitutional presumption of innocence.
Hence, while denial is concededly fragile and unstable, the conviction of the accused
cannot be based thereon. The rule in criminal law is firmly entrenched that verdicts of
conviction must be predicated on the strength of the evidence for the prosecution and
not on the weakness of the evidence for the defense.
Same; Same; Same; Motive; Motive alone cannot take the place of proof beyond
reasonable doubt sufficient to overthrow the presumption of innocence.—With hardly
any substantial evidence left, the prosecution likewise played up the feud between the
Adors on one hand and the Chavezes and the Cuyas on the other hand, and suggested
that the Adors had an axe to grind against the Chavezes and the Cuyas. For sure,
motive is not sufficient to support a conviction if there is no other reliable evidence
from which it may reasonably be adduced that the accused was the malefactor. Motive
alone cannot take the place of proof beyond reasonable doubt sufficient to overthrow
the presumption of innocence.
Same; Same; Same; It is hornbook doctrine that suspicions and speculations can never
be the basis of conviction in a criminal case.—The case of the prosecution has been
reduced to nothing but mere suspicions and speculations. It is hornbook doctrine that
suspicions and speculations can never be the basis of conviction in a criminal case.
Courts must ensure that the conviction of the accused rests firmly on sufficient and
competent evidence, and not the results of passion and prejudice. If the alleged
inculpatory facts and circumstances are capable of two (2) or more explanations, one
of which is consistent with the innocence of the accused, and the other consistent with
his guilt, then the evidence is not adequate to support conviction. The court must acquit
the accused because the evidence does not fulfill the test of moral certainty and is
therefore insufficient to support a judgment of conviction. Conviction must rest on
nothing less than a moral certainty of the guilt of the accused.
Constitutional Law; Confessions; Admissions under custodial investigation made
without the assistance of counsel are barred as evidence; A suspect’s confession,
whether verbal or non-verbal, when taken without the assistance of counsel without a
valid waiver of such assistance regardless of the absence of such coercion, or the fact
that it had been voluntarily given, is inadmissible in evidence, even if such confession
were gospel truth.—The rights of a person under custodial investigation, including the
right to counsel, have already attached to the Adors, and pursuant to Art. III, Sec. 12(1)
and (3), 1987 Constitution, any waiver of these rights should be in writing and
4
undertaken with the assistance of counsel. Admissions under custodial investigation
made without the assistance of counsel are barred as evidence. The records are bare of
any indication that the accused have waived their right to counsel, hence, any of their
admissions are inadmissible in evidence against them. As we have held, a suspect’s
confession, whether verbal or non-verbal, when taken without the assistance of counsel
without a valid waiver of such assistance regardless of the absence of such coercion, or
the fact that it had been voluntarily given, is inadmissible in evidence, even if such
confession were gospel truth. People vs. Ador, 432 SCRA 1, G.R. Nos. 140538-39
June 14, 2004
The quiescence of the fading day was shattered by bursts of gunfire, startling the
otherwise tranquil but sanguine folks of Pacol, Naga City.As the fusillade of shots
ceased and the wisp of smoke cleared, frolicking promenaders stumbled upon Ompong
Chavez who was gasping his last, clutching his intestines which had spewed out from
his bloodied stomach.He did not in fact reach the hospital alive.A breath away, Abe
Cuya lay lifeless on the pavement.He died on the spot.For the twinned deaths, the
Adors, six (6) of them, were haled to court.
1 2
In two (2) separate informations,  Diosdado Sr.,  Diosdado Jr., Diosdado III,
Godofredo, Rosalino and Allan, all surnamed Ador, were charged with the murder of
Absalon Abe S. Cuya III and Rodolfo Ompong S. Chavez.The Informations in Crim.
Cases Nos.97-6815 and 97-6816 identically read:ςηαñrοblεš νιr†υαl lαω lιbrαrÿ
That on or about March 10, 1997, in the City of Naga, Philippines, and within the
jurisdiction of this Honorable Court, the above-named accused, conspiring,
confederating together and mutually helping one another, with intent to kill, with
treachery and the aid of armed men, did then and there willfully, unlawfully and
feloniously shoot ABSALON ABE CUYA III (RODOLFO OMPO CHAVEZ y SAN
ANDRES3 for Crim. Case No. 97-6816) with firearms, inflicting upon him multiple
and mortal gunshot wounds which caused his death, to the damage and prejudice of his
heirs.
With the aggravating circumstance of evident premeditation and nighttime.
CONTRARY TO LAW.
However, only four (4) of the six (6) Adors, namely, Diosdado Sr., Godofredo,
Rosalino and Allan, were taken into custody.The two (2), Diosdado Jr. and Diosdado
III, remained at large.Trial thus proceeded only against Diosdado Sr., Godofredo,
Rosalino and Allan who all pleaded not guilty.Diosdado Sr. is the father of Diosdado
Jr., Diosdado III and Godofredo, while Rosalino is the father of Allan.Diosdado Sr.
and Rosalino are brothers.4 
In its effort to secure the conviction of the accused, the prosecution presented a total of
sixteen (16) witnesses: Mercy Beria, Larry Cado, Medico-Legal Officer of Naga City
Dr. Joel S. Jurado, Police Inspector Ma. Julieta Razonable, SPO1 Benjamin Barbosa,
SPO3 Augusto Basagre, Major Ernesto Idian, Inspector Reynaldo F. Fulgar, SPO1
Noli Reyes Sol, SPO3 Eduardo C. Bathan, Inspector Vicente C. Lauta, Ernani Castillo,
PO3 Augusto I. Nepomuceno, Absalon Cuya Sr., Efren Chavez and Pablo Calsis.
From the evidence of the prosecution, it appears that on March 10, 1997, at around
seven-thirty in the evening, while Mercy Beria, Larry Cado and some eleven (11)
others were leisurely walking along Kilometer 11 on their way to Zone 1, Kilometer
10, Pacol, Naga City, to attend a wedding anniversary, they heard several
gunshots.Shortly after, they met a certain Pablito Umali who told them that Ompong
Chavez had been shot.They ran to Chavez straight off and saw him already lying on
the ground, about 1 meters away from a lighted electric post, holding on to his
intestines which were starting to come out.Beria shook Chavez and asked him what
had happened.Chavez replied tinambangan kami na Ador (We were ambushed by the
Adors) and requested that he be brought to the hospital as he was dying.About eight (8)
meters from where Chavez was, in a dark spot, lay Abe Cuya, dead.5 
Upon learning of the shooting incident through their radio communication, SPO1
Benjamin Barbosa, together with PO2 Alexander Diaz, immediately proceeded to the
crime scene to conduct an investigation.SPO3 Eduardo Bathan and SPO1 Wilfredo
Fernandez, among others, were already there. 6 SPO1 Barbosa collected some pieces of
evidence, took some pictures and made some sketches. 7 SPO1 Fernandez on the other
hand interviewed one Cresenciana Mendoza in her house which was nearby, and when
he heard people shout that Chavez was still alive, he brought Chavez to the hospital but
the latter expired on the way.8 
That same evening, upon being informed that the Adors had a long-standing grudge
against the Cuyas, SPO1 Barbosa sought the help of then Barangay Captain Josue
Perez to accompany him to the residence of the Adors.They arrived at the Adors at
around ten oclock that evening and spoke with their patriarch, Diosdado Ador Sr.
SPO1 Barbosa looked for the other male members of the Ador family but was told by
Diosdado Sr. that they were already asleep.Diosdado Sr. nevertheless promised to
present them the following day.9 
The following morning, March 11, 1997, Barangay Captain Perez accompanied the
Adors, namely, Diosdado Sr., Diosdado III, Godofredo, Rosalino, Allan and Reynaldo,
to SPO1 Barbosa at the PNP Central Police Headquarters.The Adors were informed of
their constitutional rights to remain silent and to choose their own counsel.They were
then brought to the PNP Crime Laboratory at the Provincial Headquarters and
subjected to paraffin tests.10 On the way to the crime laboratory, Godofredo told his
police escort that he had been entrusted with a handgun which he kept in his
residence.11 The information was relayed to Major Ernesto Idian, then Deputy Chief of
Police of Naga City, who ordered PO3 Augusto I. Nepomuceno to accompany him in
recovering the gun because Godofredo said that he would turn in the gun only to PO3
5
Nepomuceno.Thus, Major Idian, PO3 Nepomuceno and some others accompanied
Godofredo to the latters residence.
Upon reaching the Ador residence, Godofredo, together with PO3 Nepomuceno, went
to their backyard, retrieved the gun from under a fallen coconut trunk and turned it in
to the latter.Godofredo allegedly told the police that he fired the said gun outside their
house on the night of March 10 after he heard several gunshots. 12 PO3 Nepomuceno
identified the gun as a caliber .38 paltik handgun which had no serial number. 13 PO3
Nepomuceno then turned over the handgun to Major Idian 14 who likewise identified it
as a .38 caliber revolver.Major Idian returned the handgun to PO3 Nepomuceno for
ballistic and paraffin examination.15 Thereafter, PO3 Nepomuceno placed his initials
on the gun and put it in his private locker while preparing the documents for the
examinations and the possible filing of a case for Illegal Possession of Firearm. 16  funeral and burial expenses which amounted to P10,230.00.25 ςrνll
Also, on the same day, March 11, 1997, Dr. Joel S. Jurado, Medico-Legal Officer of
Naga City, conducted an autopsy on the bodies of Chavez and Cuya.Based on the
autopsy reports, Dr. Jurado testified that Cuya sustained five (5) gunshot wounds and
died from cardio-pulmonary arrest, massive intra-thoracic, intra-abdominal, intra-
cranial hemorrhage secondary to multiple gunshot wounds penetrating the heart, brain,
lungs and digestive tract. 17 Chavez on the other hand had three (3) gunshot wounds and
died from traumatic shock and massive intra-abdominal hemorrhage secondary to
multiple gunshot wounds penetrating the right kidney and the internal abdominal
organs.18 Dr. Jurado further testified that that he recovered a slug from Cuyas head
three (3) days after he conducted the autopsy - after Cuyas relatives called his attention
to a protruding mass in Cuyas head.Thus, he had Cuyas cadaver sent back to the
funeral parlor, opened it and was able to extract a deformed .38 caliber slug which he
thereafter submitted to the City Prosecutors Office. 19 
Police Inspector Reynaldo Fulgar, Chief of the Firearm Identification Section of the
PNP Crime Laboratory, Camp Ola, Legaspi City, testified that based on the ballistic
examination he conducted on the bullets submitted to his office, the .38 caliber slug
recovered from Cuyas head matched the three (3) .38 caliber test bullets which were
test-fired from the suspected firearm surrendered by Godofredo.He however averred
that the .38 caliber bullets were actually fired from a .357 Smith and Wesson Magnum
homemade revolver without serial number, and not from a .38 caliber revolver. 20  SO ORDERED.29
The paraffin casts taken from the Adors were also transmitted to the PNP Crime
Laboratory Services for examination and yielded the presence of gunpowder nitrates,
thus
(1) Diosdado A. Ador both hands, positive;
(2) Diosdado B. Ador III right hand, positive; left hand, negative;
(3) Godofredo B. Ador right hand, positive; left hand, negative;
(4) Rosalino A. Ador both hands, positive;
(5) Reynaldo T. Ador both hands, negative;21
(6) Allan T. Ador both hands, positive.22 
Absalon Cuya Sr., father of deceased Cuya III, said that the killing of his son was
driven by the long-standing feud between the Adors and his family.He said that
Diosdado Jr. had earlier accused his other son Liberato of frustrated homicide for
allegedly stabbing him (Diosdado Jr.). 23 Then, Adelina, a daughter of Diosdado Sr.,
filed a case for abduction with multiple rape against him, Absalon III, Rayne and
Josephine, all surnamed Cuya, after the romantic relationship between Adelina and his
deceased son Absalon III turned sour. 24 He also presented official receipts of the
Efren Chavez, brother of deceased Chavez, likewise spoke of the animosity between
the Chavez and the Ador families.He produced a certification from the PNP Naga City
Police Station that on February 17, 1997, a blotter was entered in the Daily Record of
Events showing that deceased Chavez reported a certain Ricardo Ador who while
under the influence of liquor caused him physical injury. 26 The witness likewise
presented an official receipt showing that the family spent P3,500.00 for the funeral of
the deceased Chavez.27 After presenting Chavez, the prosecution rested its case.
On April 7, 1998, the four (4) accused filed a demurrer to evidence for utter lack of
evidence.28 On May 13, 1998, the trial court dismissed the cases against Diosdado Sr.,
Rosalino and Allan but denied the demurrer to evidence against Godofredo
WHEREFORE, this Court finds the demurrer to evidence to be justified for the
accused Diosdado A. Ador, Allan T. Ador and Rosalino Ador, hence, the same is
hereby granted insofar as these accused are concerned.Said accused therefore, namely:
Diosdado A. Ador, Allan T. Ador and Rosalino Ador are ACQUITTED in Crim. Cases
Nos. 97-6815 and 97-6816.The bailbonds posted for their provisional liberty are
hereby cancelled.
Trial of the case insofar as Godofredo B. Ador is concerned shall proceed.
 
Thus, trial proceeded against Godofredo.
For his defense, Godofredo denied any participation in the killings of Cuya and
Chavez.He said that on March 10, 1997, at aroundseven oclock in the evening, he
heard several gunshots while he was having dinner with his wife and four (4) children
in their house in Pacol,NagaCity.Since his wife advised him not to go out anymore, he
slept after dinner.The following day, while he was gathering pili nuts, his long-time
friend Dominador Bautista arrived and asked him to go down from the tree.Bautista
6
wanted to borrow money and on his way to see him, found a gun by the
footpath.Bautista gave the gun to him.It was his first time to hold a gun.He tried it out
and fired three (3) times.After firing the gun, he removed the empty shells from its
chambers and threw them away.He then wrapped the gun with plastic and hid it under
a coconut trunk.Bautista left when he told him that he had no money.He then continued
to gather pili nuts until Major Idian and three (3) other policemen came.
Godofredos father told him that they were being suspected of killing Chavez and Cuya
the night before.Thus, they went to the provincial headquarters, were subjected to
paraffin testing and made to sign a blank bond paper.After that, they went back to the
central police station.At the central police station, Godofredo narrated to a certain
Calabia that that morning, his friend Bautista found a gun along the road and gave it to
him.He hid the gun under a coconut trunk.Calabia relayed the information to Major
Idian who directed PO3 Nepomuceno to go with Godofredo to get the gun.Godofredo
led PO3 Nepomuceno to where he hid the gun, retrieved it and handed it to the
latter.They then returned to the police headquarters where he was jailed.He asserted
that the gun presented in court is different from the gun he surrendered to the police.30 
Bautista corroborated Godofredos story.He testified that he found the gun which
Godofredo yielded to PO3 Nepomuceno.He said that he was on his way to see
Godofredo to borrow money when he chanced upon the handgun on the pathway.He
gave the gun to Godofredo and the latter tested it by pulling its trigger.After firing the
gun, Godofredo removed the empty shells and threw them.Godofredo then wrapped
the gun with plastic and hid it under a fallen coconut trunk.31 ςrνll
Meanwhile, Diosdado Jr. was arrested on October 9, 1998, at Barangay Doa,
Orani,Bataan, and committed to the Naga City Jail on November 17, 1998, while
Diosdado III surrendered to the court and was committed to the same city jail on
November 22, 1998.On November 23, 1998, both Diosdado Jr. and Diosdado III were
arraigned and entered a plea of not guilty.Hence, trial against them commenced and
proceeded jointly with the case of the remaining accused, Godofredo.
The prosecution presented Pablo Calsis32 as a witness against Diosdado Jr. and
Diosdado III.Calsis testified that on March 10, 1997, at around 7:30 in the evening, he
dropped by the house of Cresenciana Mendoza whom he fondly called Lola Kising at
Kilometer 10, Pacol, Naga City, before going home from work.After asking
permission from her to go home and while about to urinate outside her house, he heard
several gunshots.He ducked by a sineguelas tree at a nearby flower plantation.As he
was about to stand up, he saw Disodado Jr., Diosdado III, Godofredo and another
unidentified man run away.Godofredo was carrying a short firearm while Diosdado Jr.
had a long firearm.33 He saw Chavez and Cuya lying on the road.Chavez was about
five (5) meters away from where he stood while Cuya was ten (10) meters away.The
place was illuminated by a bright light from an electric post.There were no other
people around.Calsis ran away for fear that he might be identified by the assailants.He
heard Chavez mumbling but shirked nevertheless.34 ςrνll
Calsis narrated to Absalon Cuya Sr. what he saw only after about one (1) year and nine
(9) months.Fear struck him.35 He maintained that he knew the assailants because he
and his wife lived in the house of Lola Kising after they got married. 36 Immense fear
prevented him from attending to Chavez, even while he heard him murmuring, and
from informing the families of the victims of the incident that very same night.He was
about to tell the Chavez family the following morning but was counseled by his Lola
Bading, the sister of his Lola Kising, against getting involved in the case. 37 Calsis and
his family left their residence in Pacol one (1) month after the incident because he was
afraid the assailants might have identified him. 38 Even Lola Kising left her residence
two (2) months after the incident.39 It was only after he learned from Absalon Cuya
Sr.that the trial court dismissed the cases for lack of evidence insofar as some of the
original accused were concerned that he took pity on the respective families of the
victims who have failed to get justice for the death of their loved ones. 40 
In defense, Diosdado Jr. testified that on March 10, 1997, he was in Marikina City
working as a warehouseman and timekeeper of the Consuelo Builders Corporation.He
was there the whole time from February 15, 1997, until March 24, 1997. 41 Pablo Aspe,
a co-worker of Diosdado Jr., corroborated the latters testimony.He said that on
February 15, 1997, he and Diosdado Jr. left Pacol, Naga City, together to work in
Consuelo Construction in Marikina City.They were with each other in Marikina City
the whole time from February 15, 1997, until he (Aspe) went home to Naga City on
March 22, 1997.While in Marikina City, they resided and slept together in their
barracks at the construction site.42 
Diosdado III also took the witness stand.On March 10, 1997, at around seven oclock in
the evening, he was at their house at Zone 1, Pacol, Naga City, watching television
with his parents and cousins Reynaldo and Allan when they heard gunshots.They
ignored the gunshots, continued watching television and slept at eight oclock.The
following day, at around six oclock in the morning, while he was fetching water, four
(4) policemen arrived at their house and talked to his father.Thereafter, his father
called him, his brother Godofredo, uncle Rosalino and cousins Allan and
Reynaldo.The policemen then requested all of them to go to the PNP Central Police
Headquarters for investigation regarding the killings of Chavez and Cuya.Upon
reaching the police headquarters, they were interviewed by the media and afterwards
brought to the provincial headquarters where they were subjected to paraffin tests.They
were then brought back to the Central Police Headquarters and later allowed to go back
home to Pacol.
Then, sometime in October, 1997, his father was arrested by the police.Diosdado III
was at their residence when his father was picked up.Only his father was taken by the
police.He continued to reside in their house until April, 1998, when he transferred to
7
Sagurong, San Miguel, Tabaco, Albay, to work as a fisherman.On November 21, 1998,
he received a letter from his father telling him to come home.Thus, he went home the
following day.On November 23, 1998, he surrendered to the court.43  was not the same gun presented by the prosecution during the trial.The unusual
The defense also presented Barangay Captain Josue Perez and an uncle of Diosdado Jr.
and Disodado III, Jaime Bobiles.Perez testified that he was the barangay captain of
Pacol from 1982 until May, 1997.In 1996, Cresenciana Mendoza left their barangay
permanently to live with her children in Manila because she was sickly and alone in
her house.He said that Mendoza never came back.He does not know any Pablo Calsis
and the latter could not have talked to Mendoza on March 10, 1997, because at that
time, Mendoza was not there and her house was already abandoned. 44 Similarly,
Bobiles confirmed the testimony that Diosdado III worked as a fisherman in Tabaco
and stayed in his residence from May 1, 1998, until November 1998 when Diosdado
III received a letter from his father and had to go home.45  the guilt of the accused beyond reasonable doubt. 52 All the circumstances must be
In rebuttal however, prosecution witness SPO1 Fernandez asserted that he interviewed
Cresenciana Mendoza that fateful night of March 10, 1997. 46 After the rebuttal witness
was presented, the cases were finally submitted for decision.47  evidence must exclude each and every hypothesis which may be consistent with their
On August 2, 1999, the trial court held that a chain of circumstances x x x lead to a
sound and logical conclusion that indeed the accused (Diosdado III and Godofredo)
committed the offense charged48 and as such rendered judgment
WHEREFORE, premises considered, this court finds the accused Godofredo B. Ador
and Diosdado B. Ador III GUILTY beyond reasonable doubt of the crime of
MURDER, defined and penalized under the provisions of Article 248 of the Revised
Penal Code, as amended by Republic Act 7659 in Criminal Cases Nos. 97-6815 and
97-6816, hereby sentences the said accused Godofredo B. Ador and Diosdado B. Ador
III to suffer the penalty of RECLUSION PERPETUA in Criminal Case No. 97-6815;
RECLUSION PERPETUA in Criminal Case No. 97-6816, to pay the heirs of Absalon
Abe Cuya III P25,000 each by way of actual damages andP50,000 in each criminal
case by way of indemnity.To pay the heirs of Rodolfo Ompong Chavez the sum
of P50,000 in each criminal case by way of indemnity, such accessory penalties as
provided for by law and to pay the cost.For insufficiency of the prosecution to prove
the guilt of the accused Diosdado B. Ador, Jr. beyond reasonable doubt, he is hereby
ACQUITTED in Crim. Cases Nos. 97-6815 and 97-6816.
The Jail Warden of the Naga City District Jail is hereby ordered to forthwith release
from its custody the accused Diosdado B. Ador, Jr., unless his further detention is
warranted by any other legal cause or causes.
SO ORDERED.49  based on the circumstantial evidence presented.
Hence, this joint appeal interposed by Disodado III and Godofredo.They maintain that
the trial court gravely erred in convicting them of murder based on circumstantial
evidence.The testimony of prosecution witness Pablo Calsis that he saw them running
away from the scene of the crime was concocted.The handgun turned in by Godofredo
discovery of a slug from the head of the deceased - three (3) days after the autopsy was
conducted and after the cadaver was turned over to the family of the victim - was quite
doubtful.Even the supposed dying declaration of the victim specifically pointed to
neither Diosdado III nor Godofredo.And, the trial court erred in admitting in evidence
those taken against them in violation of their constitutional rights to counsel during
custodial investigation.50 
The rules of evidence allow the courts to rely on circumstantial evidence to support its
conclusion of guilt.51 It may be the basis of a conviction so long as the combination of
all the circumstances proven produces a logical conclusion which suffices to establish
consistent with each other, consistent with the theory that all the accused are guilty of
the offense charged, and at the same time inconsistent with the hypothesis that they are
innocent and with every other possible, rational hypothesis except that of guilt. 53 The
innocence.54 Also, it should be acted on and weighed with great
caution.55 Circumstantial evidence which has not been adequately established, much
less corroborated, cannot by itself be the basis of conviction.56 
Thus, for circumstantial evidence to suffice, (1) there should be more than one
circumstance; (2) the facts from which the inferences are derived are proven; and (3)
the combination of all the circumstances is such as to produce a conviction beyond
reasonable doubt.57 Like an ornate tapestry created out of interwoven fibers which
cannot be plucked out and assayed a strand at a time apart from the others, the
circumstances proved should constitute an unbroken chain which leads to one fair and
reasonable conclusion that the accused, to the exclusion of all others, is guilty beyond
reasonable doubt.58 The test to determine whether or not the circumstantial evidence on
record are sufficient to convict the accused is that the series of the circumstances
proved must be consistent with the guilt of the accused and inconsistent with his
innocence.59 Accordingly, we have set guidelines in appreciating circumstantial
evidence:(1) it should be acted upon with caution; (2) all the essential facts must be
consistent with the hypothesis of guilt; (3) the facts must exclude every theory but that
of guilt; and (4) the facts must establish such a certainty of guilt of the accused as to
convince the judgment beyond a reasonable doubt that the accused is the one who
committed the offense.60 
Measured against the guidelines set, we cannot uphold the conviction of the accused
The first circumstance which the prosecution sought to prove is that the accused were
supposedly seen fleeing from the locus criminis, armed with their respective
8
weapons.Thus, the trial court, gleaning from the evidence presented, found that [w]hen
about to stand, Calsis saw Godofredo B. Ador, Diosdado B. Ador, Jr. and Diosdado B.
Ador III, and a person going to the direction of the house of the Adors which is about
500 meters away.61 In fact, prosecution witness Calsis allegedly even saw Diosdado Jr.
carrying a long firearm but x x x could not determine what kind of gun it
was.62 However, the trial court acquitted Diosdado Jr.But only rightly so.For, Calsis
had difficulty in identifying the Adors notwithstanding his assertion that he knew and
saw them personally.We defer to his direct examination
ATTY. TERBIO (Private Prosecutor) :
Q.You said you recognized the persons running, could you tell us their
names?
PABLO CALSIS:
A.Yes sir.
Q.Name them?
A.Godofredo Ador, Jr., Sadang III.
Q.How about the others?
A.I could not tell his name but if I see him I could identify him.
Q.The 4 persons whom you saw that night, if they are present in court, please
point them out?
A.Yes sir.
Q.Point particularly Godofredo Ador, Jr.?
A.(Witness pointed or tapped the shoulder of a person inside the courtroom
who answered by the name Diosdado Ador, Jr.)
Q.How about this Sadang III?
A.(Witness tapped the shoulder of a man who answered by the name
of Diosdado Ador III.)
Q.Likewise, point to the third person?
A.(Witness pointed to a man)
COURT:
Delete that portion from the record, he is not on trial.
ATTY TERBIO:ςηαñrοblεš νιr†υαl lαω lιbrαrÿ
Q.You said you saw 4 persons, is the fourth one inside the courtroom?
A.None sir.
Q.But if you saw that person, will you be able to recognize him?
A.Yes sir.
Q.Why do you know these persons whom you just tapped the shoulder?
x x xx x xx x x
A.I know these persons having lived in the house of Lola Kising.
Q.How far?
A.Around 100 meters.
Q.On the said date and time and place, you said you saw them running, how
far were you from them?
A.Around 10 meters. (Emphases supplied)63 
The testimony of Calsis, if at all, could hardly be used against Diosdado III whom he
miserably failed to positively identify during trial.In fact, the acquittal of Diosdado Jr.
by the trial court renders the entire testimony of Calsis in serious doubt.Calsis was
presented to positively identify the assailants who were supposedly personally known
to him and were just ten (10) meters away from him.It puzzles us no end why he
cannot even identify the Adors in open court.
Thus, despite Calsis assertion that Diosdado Jr. was one of the assailants, the trial court
doubted him and gave credence to the alibi of Diosdado Jr. that the latter was in
Nangka, Marikina, when the killings took place.The trial court favored the unbiased
testimony of Aspe who said that Diosdado Jr. worked as a timekeeper and
warehouseman with him at the Consuelo Construction at Nangka, Marikina, from
February 15, 1997, until March 22, 1997, and went home to Pacol only on May 27,
1997.This ruling is strengthened by the fact that on the morning following the killings,
all the male members of the Ador family were brought to the police headquarters for
paraffin examination and Diosdado Jr. was not among them. 64 We thus respect the
finding of the trial court that indeed Diosdado Jr. was not at the scene of the crime
absent any indication that the lower court overlooked some facts or circumstances
which if considered would alter the outcome of the case.65 
While it is true that the courts are not bound to accept or reject an entire testimony, and
may believe one part and disbelieve another, 66 our Constitution and the law mandate
9
that all doubts must be resolved in favor of the accused.Calsis committed an obvious
blunder in identifying the supposed assailants which this Court cannot simply let
go.On the contrary, it creates reasonable doubt in our minds if Calcis really saw the
persons he allegedly saw or if he was even where he said he was that evening.For, it is
elementary that the positive identification of the accused is crucial in establishing his
guilt beyond reasonable doubt.That is wanting in the instant case.
What is more, Calsis asseverations, at the outset, could no longer be used against
Godofredo since both the prosecution and the defense have already rested and the case
against Godofredo was already submitted for decision when Calsis was
presented.67 Neither can they still be used against Diosdado Jr. who was already
acquitted by the trial court.
Both Diosdado III and Godofredo denied the charges hurled against them.But, while it
is true that alibi and denial are the weakest of the defenses as they can easily be
fabricated,68 absent such clear and positive identification, the doctrine that the defense
of denial cannot prevail over positive identification of the accused must yield to the
constitutional presumption of innocence. 69 Hence, while denial is concededly fragile
and unstable, the conviction of the accused cannot be based thereon. 70 The rule in
criminal law is firmly entrenched that verdicts of conviction must be predicated on the
strength of the evidence for the prosecution and not on the weakness of the evidence
for the defense.71 ςrνll
The second circumstance is the handgun turned in by Godofredo.But this was bungled
by the prosecution.Major Idian, Deputy Chief of Police of the Naga City Police
Station, to whom the handgun was turned over after Godofredo surrendered it,
identified it as a caliber .38 revolver, thus
ATTY TERBIO (Private Prosecutor) : What kind of firearm was it?
MAJOR IDIAN: A.Revolver handgun, caliber .38 with 6 rounds ammunition.
Q.What is the caliber?
A..38 caliber.72  Beria, that she heard Rodolfo Ompong Chavez say tinambangan kami na Ador (We
Similarly, PO3 Nepomuceno who then had been with the PNP for eight (8)
years already and to whom Godofredo turned in the handgun, likewise
identified it as a caliber .38, thus
ATTY TERBIO (Private Prosecutor) :
Q.What is the caliber of that gun?
PO3 NEPOMUCENO:
A..38 caliber.73 
However, Insp. Fulgar, Chief of the Firearm Identification Section of the PNP Crime
Laboratory, testified that [t]he indorsement coming from the City Prosecutors Office x
x x alleged that the .38 caliber live bullet was fired from a .38 caliber revolver.But our
office found out that the firearm was not a .38 caliber revolver but a .357 caliber
revolver.74 
Could it be that the handgun was replaced before it was turned over to the PNP Crime
Laboratory? While the prosecution traced the trail of police officers who at every stage
held the gun supposedly recovered from Godofredo, it never clarified this discrepancy
which is quite glaring to ignore.It is difficult to believe that a Deputy Chief of Police
and a police officer of eight (8) years will both mistake a .357 caliber for a .38 caliber
handgun.Likewise, a Chief of the Firearm Identification Section of the PNP Crime
Laboratory cannot be presumed not to know the difference between the two (2)
handguns.Suffice it to say that the prosecution failed to clear up the variance and for
this Court to suggest an explanation would be to venture into the realm of pure
speculation, conjecture and guesswork.Thus, faced with the obvious disparity in the
suspected firearm used in the crime and that which was turned over by Godofredo, his
declaration that the handgun presented in court was different from the gun he gave to
the police deserves serious, if not sole consideration.
Consequently, even the third circumstance, the .38 caliber slug supposedly recovered
from the head of the victim three (3) days after the autopsy was conducted loses
evidentiary value as its source is now highly questionable.It has become uncertain
whether the deformed slug was fired from the .38 caliber revolver turned in by
Godofredo or from a .357 caliber handgun as attested to by the Chief of the Firearm
Identification Section of the PNP Crime Laboratory.
Neither can this Court rely on the dying declaration of the dying Chavez nor on the
results of the paraffin tests to convict either Diosdado III or Godofredo or both.To
refute these, we need not go far and beyond the 13 May 1998 Order of the trial court
partially granting the demurrer to evidence filed by the accused
The only direct evidence introduced by the prosecution is the testimony of Mercy
were ambushed by the Adors) .Sad to say, no specific name was ever mentioned by the
witness.Neither was she able to tell how many (persons) Adors were involved.This
testimony if it will be given credence may inculpate any person with the family name
Ador as assailant.The prosecution therefore was not able to establish with moral
certainty as to who of the Adors were perpetrators of the offense x x x x Paraffin tests
are not conclusive evidence that indeed a person has fired a gun.
The fact that the accused-appellants tested positive of gunpowder nitrates does not
conclusively show that they fired the murder weapon, or a gun for that matter, for such
forensic evidence should be taken only as an indication of possibility or even of
10
probability, but not of infallibility, since nitrates are also admittedly found in
substances other than gunpowder. (People v. Abellarosa, G.R. No. 121195, 27
November 1996; People v. de Guzman, 250 SCRA 118; People v. Nitcha, 240 SCRA
283)75  admissions are inadmissible in evidence against them.As we have held, a suspects
Thus, while a dying declaration may be admissible in evidence, it must identify with
certainty the assailant.Otherwise, it loses its significance.Also, while a paraffin test
could establish the presence or absence of nitrates on the hand, it cannot establish that
the source of the nitrates was the discharge of firearms a person who tests positive may
have handled one or more substances with the same positive reaction for nitrates such
as explosives, fireworks, fertilizers, pharmaceuticals, tobacco and leguminous
plants.76 In People v. Melchor, 77 this Court acquitted the accused despite the presence
of gunpowder nitrates on his hands
[S]cientific experts concur in the view that the result of a paraffin test is not
conclusive.While it can establish the presence of nitrates or nitrites on the hand, it does
not always indubitably show that said nitrates or nitrites were caused by the discharge
of firearm.The person tested may have handled one or more of a number of substances
which give the same positive reaction for nitrates or nitrites, such as explosives,
fireworks, pharmaceuticals and leguminous plants such as peas, beans and alfalfa.A
person who uses tobacco may also have nitrate or nitrite deposits on his hands since
these substances are present in the products of combustion of tobacco.The presence of
nitrates or nitrites, therefore, should be taken only as an indication of a possibility but
not of infallibility that the person tested has fired a gun.
In fine, the admissions made by Godofredo to Major Idian and PO3 Nepomuceno
including the gun in question cannot be considered in evidence against him without
violating his constitutional right to counsel.Godofredo was already under custodial
investigation when he made his admissions and surrendered the gun to the police
authorities.The police had already begun to focus on the Adors and were carrying out a
process of interrogations that was lending itself to eliciting incriminating statements
and evidence: the police went to the Ador residence that same evening upon being
informed that the Adors had a long-standing grudge against the Cuyas; the following
day, all the male members of the Ador family were told to go to the police station; the
police was also informed of the dying declaration of deceased Chavez pointing to the
Adors as the assailants; the Adors were all subjected to paraffin examination; and,
there were no other suspects as the police was not considering any other person or
group of persons.The investigation thus was no longer a general inquiry into an
unsolved crime as the Adors were already being held as suspects for the killings of
Cuya and Chavez.
Consequently, the rights of a person under custodial investigation, including the right
to counsel, have already attached to the Adors, and pursuant to Art. III, Sec. 12(1) and
(3), 1987 Constitution, any waiver of these rights should be in writing and undertaken
with the assistance of counsel.Admissions under custodial investigation made without
the assistance of counsel are barred as evidence. 78 The records are bare of any
indication that the accused have waived their right to counsel, hence, any of their
confession, whether verbal or non-verbal, when taken without the assistance of counsel
without a valid waiver of such assistance regardless of the absence of such coercion, or
the fact that it had been voluntarily given, is inadmissible in evidence, even if such
confession were gospel truth.79 Thus, in Aballe v. People,80 the death weapon, a four-
inch kitchen knife, which was found after the accused brought the police to his house
and pointed to them the pot where he had concealed it, was barred from admission as it
was discovered as a consequence of an uncounseled extrajudicial confession.
With hardly any substantial evidence left, the prosecution likewise played up the feud
between the Adors on one hand and the Chavezes and the Cuyas on the other hand, and
suggested that the Adors had an axe to grind against the Chavezes and the Cuyas.For
sure, motive is not sufficient to support a conviction if there is no other reliable
evidence from which it may reasonably be adduced that the accused was the
malefactor.81 Motive alone cannot take the place of proof beyond reasonable doubt
sufficient to overthrow the presumption of innocence. 82 ςrνll
All told, contrary to the pronouncements of the trial court, we cannot rest easy in
convicting the two (2) accused based on circumstantial evidence.For, the pieces of the
said circumstantial evidence presented do not inexorably lead to the conclusion that
they are guilty.83 The prosecution witness failed to identify the accused in court.A
cloud of doubt continues to hover over the gun used and the slug recovered.The dying
declaration and paraffin examination remain unreliable. Godofredos uncounseled
admissions including the gun he turned in are barred as evidence.And, the supposed
motive of the accused is simply insufficient.Plainly, the facts from which the inference
that the accused committed the crime were not proven.Accordingly, the guilt of the
accused cannot be established, more so to a moral certainty.It is when evidence is
purely circumstantial that the prosecution is much more obligated to rely on the
strength of its own case and not on the weakness of the defense, and that conviction
must rest on nothing less than moral certainty.84 
Consequently, the case of the prosecution has been reduced to nothing but mere
suspicions and speculations.It is hornbook doctrine that suspicions and speculations
can never be the basis of conviction in a criminal case. 85 Courts must ensure that the
conviction of the accused rests firmly on sufficient and competent evidence, and not
the results of passion and prejudice.86 If the alleged inculpatory facts and circumstances
are capable of two (2) or more explanations, one of which is consistent with the
innocence of the accused, and the other consistent with his guilt, then the evidence is
not adequate to support conviction.87 The court must acquit the accused because the
evidence does not fulfill the test of moral certainty and is therefore insufficient to
11
support a judgment of conviction.88 Conviction must rest on nothing less than a moral
certainty of the guilt of the accused. 89 The overriding consideration is not whether the
court doubts the innocence of the accused but whether it entertains a reasonable doubt
as to his guilt.90 It is thus apropos to repeat the doctrine that an accusation is not,
according to the fundamental law, synonymous with guilt the prosecution must
overthrow the presumption of innocence with proof of guilt beyond reasonable
doubt.The prosecution has failed to discharge its burden.Accordingly, we have to
acquit.
IN VIEW WHEREOF, the Decision of the Regional Trial Court of Naga City, Br. 25,
in Crim. Cases Nos. 97-6815 and 97-6816 dated August 2, 1999, finding accused-
appellants Godofredo B. Ador and Diosdado B. Ador III guilty beyond reasonable
doubt of two (2) counts of murder and imposing on them the penalty of reclusion
perpetua, is hereby REVERSED and SET ASIDE.Accused-appellants Godofredo B.
Ador and Diosdado B. Ador III are ACQUITTED on reasonable doubt and their
IMMEDIATE RELEASE is hereby ORDERED unless they are being held for some
other legal cause.
SO ORDERED.
Note.—Well-settled is the rule that motive can be essential to conviction where the
evidence on the commission of the crime is circumstantial. (People vs. Orcula, Sr., 335
SCRA 129 [2000]) People vs. Ador, 432 SCRA 1, G.R. Nos. 140538-39 June 14, 2004
G.R. No. 140679. January 14, 2004
PEOPLE OF THE PHILIPPINES, appellee, vs. MANNY A. DOMINGCIL,
appellant.
Criminal Law; Dangerous Drugs Act; Evidence; Witnesses; The evaluation by the trial
court of the credibility of witnesses is entitled to the highest respect and will not be
disturbed on appeal unless certain facts of substance and value were overlooked which,
if considered, might affect the result of the case.—Time and again, this Court has ruled
that the evaluation by the trial court of the credibility of witnesses is entitled to the
highest respect and will not be disturbed on appeal unless certain facts of substance
and value were overlooked which, if considered, might affect the result of the case.
The reason for this rule is that the trial court is in a better position to decide thereon,
having personally heard the witnesses and observed their deportment and manner of
testifying during the trial. After a thorough and careful review of the records of this
case, we find that the guilt of the appellant was sufficiently established by the
evidence, and the trial court’s judgment is well-supported by law and jurisprudence.
Same; Same; Same; Same; What is material to the prosecution for illegal sale of
dangerous drugs is the proof that the sale actually took place, coupled with the
presentation in court of the corpus delicti as evidence.—What is material to the
prosecution for illegal sale of dangerous drugs is the proof that the sale actually took
place, coupled with the presentation in court of the corpus delicti as evidence. In this
case, the prosecution adduced proof beyond reasonable doubt that the appellant sold
one (1) kilo of marijuana to poseur-buyer SPO1 Orlando Dalusong in the entrapment
operation.
Same; Same; Same; Same; Unless there is clear and convincing evidence that the
members of the buy-bust team were inspired by any improper motive or were not
properly performing their duty, their testimonies on the buy-bust operation deserve full
faith and credit.—The testimonies of the principal prosecution witnesses complement
each other, giving a complete picture of how the appellant’s illegal sale of the
prohibited drug transpired, and how the sale led to his apprehension in flagrante
delicto. Their testimonies establish beyond doubt that dangerous drugs were in the
possession of the appellant who had no authority to possess or sell the same. More
importantly, all the persons who obtained and received the confiscated stuff did so in
the performance of their official duties. Unless there is clear and convincing evidence
that the members of the buy-bust team were inspired by any improper motive or were
not properly performing their duty, their testimonies on the buy-bust operation deserve
full faith and credit.
12
Same; Same; Same; Same; For testimonial evidence to be believed, it must not only
proceed from the mouth of a credible witness but must also be credible in itself such
that a common experience and observation of mankind lead to the inference of its
probability under the circumstances.—It is axiomatic that for testimonial evidence to
be believed, it must not only proceed from the mouth of a credible witness but must
also be credible in itself such that common experience and observation of mankind
lead to the inference of its probability under the circumstances. In criminal
prosecution, the court is always guided by evidence that is tangible, verifiable and in
harmony with the usual course of human experience and not by mere conjecture or
speculation. Testimonies that do not adhere to this standard are necessarily accorded
little weight or credence. Besides, instigation, or the appellant’s claim of a frame-up, is
a defense that has been invariably viewed by this Court with disfavor because the same
can easily be concocted and is a common standard defense ploy in most prosecutions
for violations of the Dangerous Drugs Act.
Same; Same; Same; Same; Testimony or identity of the police informant may be
dispensed with inasmuch as his or her narration would be merely corroborative,
especially when the poseur-buyer himself testified on the sale of the illegal drug.—The
failure of the prosecution to present Oliver, the police informant, does not enfeeble the
case for the prosecution. Informants are almost always never presented in court
because of the need to preserve their invaluable service to the police. Their testimony
or identity may be dispensed with inasmuch as his or her narration would be merely
corroborative, especially so in this case, when the poseur-buyer himself testified on the
sale of the illegal drug.
Same; Same; Same; The marked money used in the buy-bust operation is not
indispensable in drug cases; it is merely corroborative evidence.—Even if the xerox
copy of the P500.00 bill was erroneously admitted in evidence by the trial court, the
absence of the original of the marked money is inconsequential. The marked money
used in the buy-bust operation is not indispensable in drug cases; it is merely
corroborative evidence. People vs. Domingcil, 419 SCRA 291, G.R. No. 140679
January 14, 2004
For the sale and delivery of one (1) kilo of marijuana to a poseur-buyer, the appellant
Manny Domingcil was charged before the Regional Trial Court of Laoag City, Branch
16, for violation of Section 4, Article II of Republic Act No. 6425 in an Information,
the accusatory portion of which reads:
That on or about the 12th day of August, 1994, in the City of Laoag, Philippines, and
within the jurisdiction of this Honorable Court, the said accused, not authorized by
law, did then and there willfully, unlawfully and feloniously sell and deliver mixed
dried marijuana leaves, tops and seeds in brick form, wrapped with paper placed in a
plastic bag, a prohibited drug, weighing 800 grams, to a poseur-buyer in a buy-bust
operation conducted by Police Officers of Laoag City, in violation of the aforesaid
law.1
Upon arraignment on August 29, 1994, the appellant, assisted by counsel, pleaded not
guilty to the offense charged.2 The case thereafter proceeded to trial.
The Case for the Prosecution
On August 12, 1994, at around 11:00 a.m., Belrey Oliver, an employee of Ferd’s
Upholstery Shop located in Barangay 2, Laoag City, arrived at the Laoag Police
Station. He reported to Chief Investigator SPO4 Rodrigo Ventura that the appellant
went to their shop looking for a buyer of marijuana. Oliver recounted telling the
appellant that he knew of someone who was interested and ready to buy marijuana, and
instructing him to bring one (1) kilo of the substance to a store located in front of the
Divine Word College of Laoag at General Segundo Avenue, Laoag City at around 1:30
p.m. of that same day.3
Acting on the said report, SPO4 Ventura formed a team to conduct a buy-bust
operation against the appellant. He assigned SPO1 Orlando Dalusong as the poseur-
buyer, and SPO2 Marlin Ramos, SPO2 Warlito Maruquin, SPO1 Rovimanuel
Balolong, SPO1 Loreto Ancheta, and SPO2 Rosemarie Agustin, all assigned at the
Investigation Section of the Laoag Police Station as back-up. The marked "buy-
money" consisting of one P500-bill bearing Serial No. G-242745 was recorded in the
police blotter in accordance with standard operating procedure.4
Except for SPO1 Dalusong and Oliver, the rest of the team left the precinct on board
two (2) owner-type jeeps and posted themselves near the Macmac Store, across the
gate of the Divine Word College. Five minutes later, SPO1 Dalusong and Oliver
arrived at General Segundo Avenue.5 Oliver immediately approached the appellant,
who was then standing between the Macmac Store and a xerox center, and introduced
poseur-buyer SPO1 Dalusong, who was sporting casual clothes and slippers: "Pare,
daytoy tay gumatangen" ("Friend, this is the buyer"). At this point, the appellant who
was carrying an orange plastic bag, brought out a brick-like item wrapped in
newspaper. He handed the item to SPO1 Dalusong, who forthwith checked the same
by making a small hole through it. Convinced that the brick-like item was indeed
marijuana, SPO1 Dalusong handed the P500 bill to the appellant. He thereupon
scratched his head, a signal to the back-up men that the transaction had been
consummated.6 Momentarily, the back-up officers, who had earlier positioned
themselves separately in different strategic locations near the poseur-buyer, rushed to
the scene and arrested the appellant. SPO1 Dalusong then handed the orange plastic
bag containing the suspected marijuana to SPO4 Ventura. SPO2 Ramos frisked the
appellant and recovered the buy-money from the latter’s pocket. Thereafter, the
appellant was brought to the headquarters where he was booked, and the incident was
recorded in the police blotter.7 The suspected marijuana was brought to and initially
13
examined by Dr. Joseph Adaya, an accredited physician of the Dangerous Drugs Board
(DDB), who certified that the item comprised of three genuine mixture of marijuana
leaves with seeds.8
On September 5, 1994, SPO4 Ventura sent a letter to the Commanding Officer of the
PNP Crime Laboratory Service, Camp Diego Silang, San Fernando, La Union,
requesting for the examination of samples of the suspected marijuana taken from the
appellant.9 On September 6, 1998, SPO1 Loreto Ancheta, evidence custodian of the
Laoag City, PNP, delivered the orange plastic bag containing the suspected marijuana
to the PNP provincial crime laboratory service in Camp Juan, Laoag City. The bag,
together with SPO4 Ventura’s letter-request, was received by SPO3 Diosdado
Mamotos.10 On September 8, 1994, SPO3 Mamotos forwarded the laboratory request
and the confiscated item, and were duly received by SPO4 Tampos. 11 The latter, in
turn, handed the item to Police Superintendent Theresa Ann B. Cid, Forensic Chemist
of the Crime Laboratory Center, Region I, Camp Diego Silang, Carlatan, San
Fernando, La Union, who conducted an examination of representative samples
extracted from the suspected marijuana confiscated from the appellant. 12 On the basis
of her examination, Superintendent Cid issued Chemistry Report No. D-074-94 with
the following findings:
SPECIMEN SUBMITTED:
One (1) block of suspected marijuana fruiting tops weighing eight hundred grams
(800) wrapped with newspaper pages contained in an orange plastic bag.
...
PURPOSE OF LABORATORY EXAMINATION:
To determine the presence of marijuana on the above-mentioned specimen.
F I N D I N G S:
Qualitative examination conducted on the above-mentioned specimen prove
POSITIVE result to the test for marijuana, a prohibited drug.13
The Case for the Appellant
The appellant interposed the twin defenses of denial and alibi. He testified that
sometime in the first week of August 1994, he and Ernesto Gamiao went to the City of
Laoag to canvass the price for the repair of the upholstery of a passenger jeepney. On
that occasion, they befriended a certain Belrey Oliver who was an employee of the
Ferd’s Upholstery Shop. In the course of their conversation, Oliver asked the appellant
where he came from and what his occupation was. Upon being told that he helped in
harvesting mangoes in Cagayan, Oliver immediately offered refreshments to Gamiao
and the appellant. While taking their snacks, Oliver inquired whether they wanted to
back up the promotion of certain policemen who, in the future, might be able to return
the favor to them. When the appellant asked in what way they could extend help,
Oliver suggested that they look for somebody in Cagayan from whom they could buy
one (1) kilo of marijuana. He agreed to Oliver’s suggestion. The latter handed to him
the amount of P700.00 to cover the purchase of the marijuana. The appellant
immediately went to the terminal bound for Cagayan to look for somebody from that
province who could be of help. When he could not find anyone, he decided to
personally take the trip. He then instructed Gamiao to just go home to Vintar and
inform his mother that he was going to Cagayan.
The appellant thereafter took a bus bound for Tuguegarao, Cagayan. After three (3)
days, he was able to buy one kilo of marijuana for P300.00. When he returned to
Laoag City on August 12, 1994, he went to Ferd’s Upholstery Shop at 11:30 a.m. to
inform Oliver that he had procured the order. After seeing the marijuana, Oliver
instructed him to take it and meet him at about 12:30 p.m. of the same day in front of
the Divine Word College where they would hand over the marijuana to the policemen
they intended to help.
At about 12:00 noon, the appellant arrived at Macmac’s Store and took his merienda.
Momentarily, Oliver arrived alone on a tricycle. Oliver summoned him and they
walked southward, away from the Macmac’s Store, looking for the policemen to whom
they would deliver the marijuana. They walked back northward, at which point they
encountered an owner-type jeep which suddenly stopped. He was nonplussed when
Oliver grabbed him by the neck, seized his knapsack containing the marijuana, and
pushed him inside the jeep. He was made to sit beside the driver with another
policeman, while Oliver seated himself at the back seat with another policeman. The
jeep they were riding was followed by a patrol car. Still dazed at the sudden turn of
events, he asked Oliver four times, "Why is it that this is now happening to me(?)," but
Oliver did not respond. At the police station, he was immediately locked up. That
afternoon, SPO4 Ventura and SPO2 Ramos, accompanied by Oliver, brought him to
the City Fiscal’s Office. He was later brought to the provincial hospital where he was
subjected to a physical check-up. That was the last time he saw or heard of Oliver. 14
On July 9, 1999, the court a quo rendered judgment,15 the dispositive portion of which
reads :
WHEREFORE, premises considered, the Court is morally convinced beyond
reasonable doubt that the accused Manny Domingcil is GUILTY under Sec. 4 of Art.
II, RA No. 6425, as amended, otherwise known as the Dangerous Drugs Act of 1972.
The quantity of marijuana involved is more than 750 grams; hence, in accordance with
Sec. 20, the penalty provided for in Sec. 4, shall be applied. The accused is hereby
sentenced to reclusion perpetua with all its accessory penalties and to pay the costs.
Hence, the present appeal.
14
The appellant submits the following assignment of errors: Q   By the way, who was the chief of the Intelligence Section of Laoag City PNP, at
that time?
1. The lower Court erred in finding that the accused was not instigated in looking for
marijuana and bringing it to Laoag. A   SPO4 Ventura, sir.

2. The lower Court erred in finding that the accused received the FIVE HUNDRED Q   Was he present when the informant Belrey Oliver tipped you of (sic) about this
PESO bill, despite his denial that he received the same and that his denial cannot matter?
prevail over the positive testimony of the police officers who are presumed to be
regularly performing their official duties, there being no improper motive attributed to A   Yes, sir.
them. Q   And because of that information from Belrey Oliver, what did your Chief, SPO4
3. The lower Court erred in convicting the accused. 16 Ventura do?

The appellant contends that contrary to the collective testimonies of the prosecution A   SPO4 Ventura made or designed a plan purposely to conduct a buy-bust operation,
witnesses, Oliver instigated him to buy marijuana. The trial court erred in not giving sir.
credence and probative weight to his testimony and in considering the testimonies of Q   Where will the operation take place?
the witnesses of the prosecution.
A   In front of Macmac Store, particularly, in front of the Divine Word College of
The appeal has no merit. Laoag, sir.
Time and again, this Court has ruled that the evaluation by the trial court of the Q   And did you have any participation in that operation?
credibility of witnesses is entitled to the highest respect and will not be disturbed on
appeal unless certain facts of substance and value were overlooked which, if A   Yes, sir, I acted as the poseur buy (sic).
considered, might affect the result of the case. The reason for this rule is that the trial
Q   At what time was the operation scheduled to be executed?
court is in a better position to decide thereon, having personally heard the witnesses
and observed their deportment and manner of testifying during the trial. 17 After a A   1:30 P.M. of August 12, 1994, sir.
thorough and careful review of the records of this case, we find that the guilt of the
appellant was sufficiently established by the evidence, and the trial court’s judgment is Q   For the said operation, what preparations, if any, did your group take?
well-supported by law and jurisprudence.
A   Our Chief of Intelligence made a plan, sir.
What is material to the prosecution for illegal sale of dangerous drugs is the proof that
Q   What was the plan?
the sale actually took place, coupled with the presentation in court of the corpus
delicti as evidence.18 In this case, the prosecution adduced proof beyond reasonable A   To conduct the buy-bust operation, sir.
doubt that the appellant sold one (1) kilo of marijuana to poseur-buyer SPO1 Orlando
Dalusong in the entrapment operation. Q   And you said that you were to act as poseur buyer, anything was given to you in
connection with your specific participation?
Q   How has the case involving drug or marijuana involving the accused brought to
your attention or to your office, for that matter? A   I was given the buy-bust money in the amount of P500.00, sir.

A   Our informant by the name of Belrey Oliver tipped of (sic) to us that he met Manny Q   And what will you do with that P500.00?
Domingcil at the Upholstery Shop along Ablan Avenue and he also informed us that he
A   The Chief of Intelligence, SPO4 Ventura directed me to reflect the serial number of
ordered P500.00 worth of marijuana.
the money in the police blotter, the P500.00 to be used as marked money.
Q   Who ordered from whom?
Q   And after the serial number was entered in the police blotter, what next did you do?
A   Belrey Oliver from Manny Domingcil, sir.

15
A   Before we went out of the station, the team or companions of SPO4 Ventura went
ahead to the place where the transaction will take place, sir.
Q   And who were the companions of SPO4 Ventura who went ahead?
A   Rosemarie Agustin, SPO2 Marlin Ramos and SPO4 Balolong, sir, while Oliver and
myself were the ones who went together.
Q   Who went ahead to the place where the sale will take place?
A   The team of SPO4 Ventura, sir.
Q   And did you reach the place where the transaction will take place?
A   Yes, sir.
Q   Before you started to the place where the transaction will take place in front of the
Divine Word College of Laoag, did you know then the face of Manny Domingcil?
A   No, sir.
Q   How did you know his face then?
A   Belrey Oliver, the informant, informed me that the person is Manny Domingcil.
Q   So, what you are saying is: when you arrived at the scene where the transaction
would take place, Manny Domingcil was already there and that Belrey Oliver pointed
him to you?
A   Yes, sir.
Q   After that, what did you do with Belrey Oliver?
A   We went near Manny Domingcil, sir.
Q   And after or as soon as you were near him, what happened next?
A   Belrey Oliver introduced Manny Domingcil to me as the buyer, sir.
Q   What did Oliver say?
A   "Pare, daytoy tay gumatangen", (which when translated into english[sic] means):
"Pare, this is the buyer."
Q   And so, what was the reaction of Manny Domingcil?
A   Before that I asked Manny Domingcil if he has the stuff that was ordered.
Q   And what did he say?
A   Manny Domingcil said: "There is, Pare."
Q   By the way, who ordered the stuff from Manny Domingcil?
A   Belrey Oliver, sir.
Q   Did you ask Oliver where he ordered that from Manny Domingcil?
A   Yes, sir.
Q   Where?
A   At the Upholstery Shop at Ablan Avenue, sir.
Q   That was what Oliver told you when he ordered the stuff?
A   Yes, sir.
Q   When Manny Domingcil said: "There is, pare," what transpired next, if any?
A   I told him: "Can I look at it" and he brought out a wrapped brick-type form
wrapped in a newspaper inside an orange plastic bag.
Q   And after he had brought out the said thing, what did you do with it?
A   I checked the contents if it is real marijuana, sir.
Q   You said the thing was wrapped with newspaper and you said you checked its
contents?
A   Yes, sir, I opened the wrapper, by making a small hole at the side.
Q   And what was the result of your inspection?
A   I found out that it was real marijuana, sir.
Q   And, so what did you do then?
A   After I found out that it was marijuana I handed to Manny Domingcil the P500
peso bill, sir.
Q   And as soon as you have handed the P500.00 bill, what did you do next?
A   I gave the signal to my companions, sir.
Q   And what did your companions do when you gave the signal?
A   They apprehended Manny Domingcil, sir.
Q   What was your signal?
16
A   I scratched my head, sir.
Q   And, what was your attire at that time you bought the brick-type marijuana from
Manny Domingcil?
A   Ordinary clothes, sir, wearing slippers.
Q   And all the time during your transaction with Manny Domingcil, where was Belrey
Oliver?
A   At my side, sir.
Q   And during the transaction, did Belrey Oliver say anything?
A   None, sir.
Q   And after giving your signal to your companion police officers who were nearby
and they rushed to your place where you were, what happened?
A   They apprehended Manny Domingcil, sir.
Q   And what about the marijuana which you said Manny Domingcil sold to you?
A   I handed it to SPO4 Rodrigo Ventura, sir.
Q   And what about the P500 peso bill, do you know what happened to it?
A   SPO2 Marlin Ramos recovered the P500 peso bill from the pocket of Manny
Domingcil.
Q   And after arresting Manny Domingcil where did your group go?
A   To the police station, sir.
Q   Do you know if any records were made to your police station when you returned or
arrived there?
A   Yes, sir.
Q   What for example?
A   They made a request ... we reflected in the police blotter the apprehension of
Manny Domingcil, the confiscation of the marijuana and the recovery of the marked
money in the amount of P500.00.
Q   Was the serial number of the P500 bill you recovered from the pocket of Manny
Domingcil recorded?
A   Yes, sir.
Q   And do you know what happened to the stuff later on after you returned to the
police station?
A   They made a request to Dr. Adaya to conduct an initial examination on the
confiscated marijuana, sir.19
The foregoing testimony of SPO1 Orlando Dalusong was corroborated on material
points by SPO4 Rodrigo Ventura, then Chief of the Intelligence Section of the PNP of
Laoag City who organized and conducted the operation and was part of the buy-bust
team itself.20 SPO4 Ventura remained steadfast and unwavering on cross-examination
despite intense grilling by the defense counsel.21
Police Superintendent Theresa Ann Cid, the Forensic Chemist assigned at the PNP
Crime Laboratory Center at San Fernando, La Union, confirmed 22 Dr. Joseph Adaya’s
initial finding23 that the substance seized from the appellant was indeed marijuana, a
prohibited drug.
It was also fairly established by SPO3 Diosdado Mamotos 24 and SPO1 Loreto
Ancheta25 that the confiscated marijuana was the same substance examined by the
forensic chemist and later presented as evidence in court.
The testimonies of the principal prosecution witnesses complement each other, giving
a complete picture of how the appellant’s illegal sale of the prohibited drug transpired,
and how the sale led to his apprehension in flagrante delicto. Their testimonies
establish beyond doubt that dangerous drugs were in the possession of the appellant
who had no authority to possess or sell the same. More importantly, all the persons
who obtained and received the confiscated stuff did so in the performance of their
official duties. Unless there is clear and convincing evidence that the members of the
buy-bust team were inspired by any improper motive or were not properly performing
their duty, their testimonies on the buy-bust operation deserve full faith and credit.26
The appellant’s bare denial of the crime charged and his barefaced claim that he was
merely instigated by Oliver into procuring the marijuana cannot prevail over the
straightforward and positive testimonies of the prosecution witnesses. It is incredible
that the appellant, who had just met Belrey Oliver in the course of his canvass for the
upholstery of his brother’s jeepney, would readily leave his errand behind and allow a
stranger to talk him into buying a prohibited drug, a known criminal activity for which
he could be prosecuted, and if convicted, sentenced to reclusion perpetua. All this he
was willing to risk, in exchange for an empty promise of alleged future favors from
another who was also unknown to the appellant. The appellant supposedly traveled to
and spent almost three days in Tuguegarao, Cagayan, just to be able to accommodate a
newly found acquaintance, who handed the appellant the meager sum of P700.00 for
the intended purpose. The Court cannot give credence to such a preposterous stance as
17
advanced by the appellant and confirmed by his supposed corroborative witness,
Ernesto Gamiao.
It is axiomatic that for testimonial evidence to be believed, it must not only proceed
from the mouth of a credible witness but must also be credible in itself such that
common experience and observation of mankind lead to the inference of its probability
under the circumstances. In criminal prosecution, the court is always guided by
evidence that is tangible, verifiable and in harmony with the usual course of human
experience and not by mere conjecture or speculation. Testimonies that do not adhere
to this standard are necessarily accorded little weight or credence. 27 Besides,
instigation, or the appellant’s claim of a frame-up, is a defense that has been invariably
viewed by this Court with disfavor because the same can easily be concocted and is a
common standard defense ploy in most prosecutions for violations of the Dangerous
Drugs Act.28 Thus, in People vs. Bongalon,29 the Court held:
As we have earlier stated, the appellant’s denial cannot prevail over the positive
testimonies of the prosecution witnesses. We are not unaware of the perception that, in
some instances, law enforcers resort to the practice of planting evidence to extract
information or even to harass civilians. However, like alibi, frame-up is a defense that
has been viewed by the Court with disfavor as it can easily be, concocted, hence,
commonly used as a standard line of defense in most prosecutions arising from
violations of the Dangerous Drugs Act. We realize the disastrous consequences on the
enforcement of law and order, not to mention the well-being of society, if the courts,
solely on the basis of the policemen’s alleged rotten reputation, accept in every
instance this form of defense which can be so easily fabricated. It is precisely for this
reason that the legal presumption that official duty has been regularly performed exists.
The failure of the prosecution to present Oliver, the police informant, does not enfeeble
the case for the prosecution. Informants are almost always never presented in court
because of the need to preserve their invaluable service to the police. Their testimony
or identity may be dispensed with inasmuch as his or her narration would be merely
corroborative, especially so in this case, when the poseur-buyer himself testified on the
sale of the illegal drug.30
The appellant’s claim that the prosecution offered in evidence a mere xerox copy of
the P500.00 buy money and did not account for its failure to adduce in evidence the
original copy thereof is not supported by the records. The records show that the
original, and not merely a xerox copy of the marked money, was in fact offered in
evidence by the prosecution.31 The appellant would surely have objected if the
prosecution had offered in evidence a mere xerox copy of the bill. The appellant did
not do so. The only ground for his objection to the admission of the marked money
was that it was self-serving.
Even if the xerox copy of the P500.00 bill was erroneously admitted in evidence by the
trial court, the absence of the original of the marked money is inconsequential. The
marked money used in the buy-bust operation is not indispensable in drug cases; 32 it is
merely corroborative evidence. Moreover, the appellant was charged not only for the
sale of marijuana but also for the delivery thereof, which is committed by the mere
delivery or transfer of the prohibited drug. The consideration for the transaction is of
no moment.33
The law defines deliver as "a person’s act of knowingly passing a dangerous drug to
another with or without consideration."34 Considering that the appellant was charged
with the sale and the delivery of prohibited drugs, the consummation of the crime of
delivery of marijuana may be sufficiently established even in the absence of the
marked money. The erasures and alterations in the Joint Affidavit of the policemen
involved in the buy-bust operation did not debilitate the case of the prosecution. First.
The Joint Affidavit of the policemen was not admitted in evidence for any
party. Second. The investigator who prepared the "Joint Affidavit" erroneously stated
that the two P500.00 bills were used by the policemen who conducted the buy-bust
operation bearing Serial Numbers AA823675 and G242745. As shown by the
prosecution’s evidence the policemen used only the P500.00 bill bearing Serial No.
G242745 for the purchase of the drug. Hence, the "Joint Affidavit" of the policemen
had to be corrected to reflect the truth.
All told, the presumption of regularity in the performance of duty is, in this case,
uncontradicted by evidence to the contrary and, therefore, stands. This is bolstered by
the fact that the prosecution’s evidence fully shows and confirms such regularity.
Accordingly, there exists no cogent reason to reverse or even modify the findings of
the trial court giving credence to the evidence of the prosecution.
IN THE LIGHT OF ALL THE FOREGOING, the Decision of the Regional Trial
Court of Laoag City, Branch 16, in Criminal Case No. 7079, finding the appellant
guilty beyond reasonable doubt of the crime of violation of Section 4, Article II of
Republic Act No. 6425, is hereby AFFIRMED.
SO ORDERED.
Note.—There is no need to present the informant in court where the sale was actually
witnessed and adequately proved by prosecution witnesses. (People vs. Doria, 301
SCRA 668 [1999] People vs. Domingcil, 419 SCRA 291, G.R. No. 140679 January
14, 2004
18

G.R. Nos. 96027-28. March 8, 2005
BRIG. GEN. LUTHER A. CUSTODIO,** CAPT. ROMEO M. BAUTISTA, 2nd
LT. JESUS D. CASTRO, SGT. CLARO L. LAT, SGT. ARNULFO B. DE MESA,
C1C ROGELIO B. MORENO, C1C MARIO E. LAZAGA, SGT. FILOMENO D.
MIRANDA, SGT. ROLANDO C. DE GUZMAN, SGT. ERNESTO M. MATEO,
SGT. RODOLFO M. DESOLONG, A1C CORDOVA G. ESTELO, MSGT.
PABLO S. MARTINEZ, SGT. RUBEN AQUINO, SGT. ARNULFO ARTATES,
A1C FELIZARDO TARAN, petitioners, vs. SANDIGANBAYAN and PEOPLE
OF THE PHILIPPINES, respondents.
Actions; Pleadings and Practice; New Trial; Newly-Discovered Evidence; In the
proceedings for new trial, the errors of law or irregularities are expunged from the
record or new evidence is introduced.—In line with the objective of the Rules of Court
to set guidelines in the dispensation of justice, but without shackling the hands that
dispense it, the remedy of new trial has been described as “a new invention to temper
the severity of a judgment or prevent the failure of justice.” Thus, the Rules allow the
courts to grant a new trial when there are errors of law or irregularities prejudicial to
the substantial rights of the accused committed during the trial, or when there exists
newly discovered evidence. In the proceedings for new trial, the errors of law or
irregularities are expunged from the record or new evidence is introduced. Thereafter,
the original judgment is vacated and a new one is rendered.
Same; Same; Same; Same; This Court has repeatedly held that before a new trial may
be granted on the ground of newly discovered evidence, the following must be shown.
—Courts are generally reluctant in granting motions for new trial on the ground of
newly discovered evidence for it is presumed that the moving party has had ample
opportunity to prepare his case carefully and to secure all the necessary evidence
before the trial. Such motions are treated with great caution due to the danger of
perjury and the manifest injustice of allowing a party to allege that which may be the
consequence of his own neglect to defeat an adverse judgment. Hence, the moving
party is often required to rebut a presumption that the judgment is correct and that
there has been a lack of due diligence, and to establish other facts essential to warrant
the granting of a new trial on the ground of newly discovered evidence. This Court has
repeatedly held that before a new trial may be granted on the ground of newly
discovered evidence, it must be shown (1) that the evidence was discovered after trial;
(2) that such evidence could not have been discovered and produced at the trial even
with the exercise of reasonable diligence; (3) that it is material, not merely cumulative,
corroborative, or impeaching; and (4) the evidence is of such weight that it would
probably change the judgment if admitted. If the alleged newly discovered evidence
could have been very well presented during the trial with the exercise of reasonable
diligence, the same cannot be considered newly discovered.
Same; Same; Same; Same; Berry Rule; These standards, also known as the “Berry”
Rule, trace their origin to the 1851 case of Berry vs. State of Georgia.—These
standards, also known as the “Berry” rule, trace their origin to the 1851 case of Berry
vs. State of Georgia where the Supreme Court of Georgia held: Applications for new
trial on account of newly discovered evidence, are not favored by the Courts. x x x
Upon the following points there seems to be a pretty general concurrence of authority,
viz.; that it is incumbent on a party who asks for a new trial, on the ground of newly
discovered evidence, to satisfy the Court, 1st. That the evidence has come to his
knowledge since the trial. 2d. That it was not owing to the want of due diligence that it
did not come sooner. 3d. That it is so material that it would produce a different verdict,
if the new trial were granted. 4th. That it is not cumulative only—viz.; speaking to
facts, in relation to which there was evidence on the trial. 5th. That the affidavit of the
witness himself should be produced, or its absence accounted for. And 6th, a new trial
will not be granted, if the only object of the testimony is to impeach the character or
credit of a witness.
Same; Same; Same; Same; Burden of Proof; It should be emphasized that the applicant
for new trial has the burden of showing that the new evidence he seeks to present has
complied with the requisites to justify the holding of a new trial.—These guidelines
have since been followed by our courts in determining the propriety of motions for
new trial based on newly discovered evidence. It should be emphasized that the
applicant for new trial has the burden of showing that the new evidence he seeks to
present has complied with the requisites to justify the holding of a new trial.
Same; Same; Same; Same; The question of whether evidence is newly discovered
has two aspects: temporal and predictive.—The threshold question in resolving a
motion for new trial based on newly discovered evidence is whether the proferred
evidence is in fact a “newly discovered evidence which could not have been
discovered by due diligence.” The question of whether evidence is newly discovered
has two aspects: a temporal one, i.e., when was the evidence discovered, and a
predictive one, i.e., when should or could it have been discovered. It is to the latter that
the requirement of due diligence has relevance. We have held that in order that a
particular piece of evidence may be properly regarded as newly discovered to justify
new trial, what is essential is not so much the time when the evidence offered first
sprang into existence nor the time when it first came to the knowledge of the party now
19
submitting it; what is essential is that the offering party had exercised reasonable
diligence in seeking to locate such evidence before or during trial but had nonetheless
failed to secure it.
Same; Same; Same; Same; In criminal as well as civil cases, it has frequently been
held that the fact that blunders and mistakes may have been made in the conduct of the
proceedings in the trial court, as a result of the ignorance, inexperience, or
incompetence of counsel, does not furnish a ground for a new trial.—In criminal as
well as civil cases, it has frequently been held that the fact that blunders and mistakes
may have been made in the conduct of the proceedings in the trial court, as a result of
the ignorance, inexperience, or incompetence of counsel, does not furnish a ground for
a new trial. If such grounds were to be admitted as reasons for reopening cases, there
would never be an end to a suit so long as new counsel could be employed who could
allege and show that prior counsel had not been sufficiently diligent, or experienced, or
learned. So it has been held that mistakes of attorneys as to the competency of a
witness, the sufficiency, relevancy, materiality, or immateriality of a certain evidence,
the proper defense, or the burden of proof are not proper grounds for a new trial; and in
general the client is bound by the action of his counsel in the conduct of his case, and
can not be heard to complain that the result of the litigation might have been different
had counsel proceeded differently. Custodio vs. Sandiganbayan, 453 SCRA 24, G.R.
Nos. 96027-28 March 8, 2005
Before us is a Motion To Re-Open Case With Leave Of Court filed by petitioners who
were convicted and sentenced to reclusion perpetua by the Sandiganbayan in Criminal
Cases Nos. 10010 and 10011 for the double murder of Senator Benigno Aquino, Jr.
and Rolando Galman on August 21, 1983.[1]
Petitioners were members of the military who acted as Senator Aquino's security detail
upon his arrival in Manila from his three-year sojourn in the United States. They were
charged, together with several other members of the military, before the
Sandiganbayan for the killing of Senator Aquino who was fatally shot as he was
coming down from the aircraft of China Airlines at the Manila International Airport.
Petitioners were also indicted for the killing of Rolando Galman who was also gunned
down at the airport tarmac.
On December 2, 1985, the Sandiganbayan rendered a Decision in Criminal Cases Nos.
10010-10011 acquitting all the accused, which include the petitioners. However, the
proceedings before the Sandiganbayan were later found by this Court to be a sham
trial. The Court thus nullified said proceedings, as well as the judgment of acquittal,
and ordered a re-trial of the cases.[2]
A re-trial ensued before the Sandiganbayan.
In its decision dated September 28, 1990, the Sandiganbayan, while acquitting the
other accused, found the petitioners guilty as principals of the crime of murder in both
Criminal Cases Nos. 10010 and 10011. It sentenced them to reclusion perpetua in each
case.[3] The judgment became final after this Court denied petitioners' petition for
review of the Sandiganbayan decision for failure to show reversible error in the
questioned decision,[4] as well as their subsequent motion for reconsideration.[5]
In August 2004, petitioners sought legal assistance from the Chief Public Attorney
who, in turn, requested the Independent Forensic Group of the University of the
Philippines to make a thorough review of the forensic evidence in the double murder
case. The petitioners, assisted by the Public Attorney's Office, now want to present the
findings of the forensic group to this Court and ask the Court to allow the re-opening
of the cases and the holding of a third trial to determine the circumstances surrounding
the death of Senator Benigno Aquino, Jr. and Rolando Galman.
Petitioners invoke the following grounds for the re-opening of the case:
I
Existence of newly discovered pieces of evidence that were not available during the
second trial of the above-entitled cases which could have altered the judgment of the
Sandiganbayan, specifically:
A) Independent forensic evidence uncovering the false forensic claims that led to the
unjust conviction of the petitioners-movants.
B) A key defense eyewitness to the actual killing of Senator Benigno Aquino, Jr.
II
There was a grave violation of due process by reason of:
A) Insufficient legal assistance of counsel;
B) Deprivation of right to counsel of choice;
C) Testimonies of defense witnesses were under duress;
D) Willful suppression of evidence;
E) Use of false forensic evidence that led to the unjust conviction of the petitioners-
movants.
III
There was serious misapprehension of facts on the part of the Sandiganbayan based on
false forensic evidence, which entitles petitioners-movants to a re-trial.[6]
20
Petitioners seek to present as new evidence the findings of the forensic group
composed of Prof. Jerome B. Bailen, a forensic anthropologist from the University of
the Philippines, Atty. Erwin P. Erfe, M.D., a medico-legal practitioner, Benito E.
Molino, M.D., a forensic consultant and Human Rights and Peace Advocate, and
Anastacio N. Rosete, Jr., D.M.D., a forensic dentistry consultant. Their report
essentially concludes that it was not possible, based on the forensic study of the
evidence in the double murder case, that C1C Rogelio Moreno fired at Senator Aquino
as they descended the service stairway from the aircraft. They posit that Senator
Aquino was shot while he was walking on the airport tarmac toward the waiting
AVSECOM van which was supposed to transport him from the airport to Fort
Bonifacio. This is contrary to the finding of the Sandiganbayan in the second trial that
it was C1C Moreno, the security escort positioned behind Senator Aquino, who shot
the latter. The report also suggests that the physical evidence in these cases may have
been misinterpreted and manipulated to mislead the court. Thus, petitioners assert that
the September 28, 1990 decision of the Sandiganbayan should be voided as it was
based on false forensic evidence. Petitioners submit that the review by the forensic
group of the physical evidence in the double murder case constitutes newly discovered
evidence which would entitle them to a new trial under Rule 121 of the 2000 Rules of
Criminal Procedure. In addition to the report of the forensic group, petitioners seek to
present the testimony of an alleged eyewitness, the driver of the waiting AVSECOM
van, SPO4 Ruben M. Cantimbuhan. In his affidavit submitted to this Court, SPO4
Cantimbuhan states that he saw a man in blue uniform similar to that of the Philippine
Airlines maintenance crew, suddenly fire at Senator Aquino as the latter was about to
board the van. The man in blue was later identified as Rolando Galman.
Petitioners pray that the Court issue a resolution:
1. [a]nnulling and setting aside this Honorable Court's Resolutions dated July 23, 1991
and September 10, 1991;
2. [a]nnulling and setting aside the Decision of the Sandiganbayan (3 rd Division) dated
September 28, 1990 in People vs. Custodio, et al., Case No. 10010-10011[;]
3. [o]rdering the re-opening of this case; [and]
4. [o]rdering the Sandiganbayan to allow the reception of additional defense
evidence/re-trial in the above entitled cases.[7] '
The issue now is whether petitioners are entitled to a third trial under Rule 121 of the
2000 Rules of Criminal Procedure.
The pertinent sections of Rule 121 of the 2000 Rules of Criminal Procedure provide:
Section 1. New Trial or reconsideration. ' At any time before a judgment of
conviction becomes final, the court may, on motion of the accused or at its own
instance but with the consent of the accused, grant a new trial or reconsideration.
Sec. 2. Grounds for a new trial. ' The court shall grant a new trial on any of the
following grounds:
(a) That errors of law or irregularities prejudicial to the substantial rights of the
accused have been committed during the trial;
(b) That new and material evidence has been discovered which the accused could
not with reasonable diligence have discovered and produced at the trial and
which if introduced and admitted would probably change the judgment.
xxx
Sec. 6. Effects of granting a new trial or reconsideration. ' The effects of granting a
new trial or reconsideration are the following:
(a) When a new trial is granted on the ground of errors of law or irregularities
committed during the trial, all the proceedings and evidence affected thereby shall be
set aside and taken anew. The court may, in the interest of justice, allow the
introduction of additional evidence.
(b) When a new trial is granted on the ground of newly discovered evidence, the
evidence already adduced shall stand and the newly-discovered and such other
evidence as the court may, in the interest of justice, allow to be introduced shall be
taken and considered together with the evidence already in the record.
(c) In all cases, when the court grants new trial or reconsideration, the original
judgment shall be set aside or vacated and a new judgment rendered
accordingly. (emphasis supplied)
In line with the objective of the Rules of Court to set guidelines in the dispensation of
justice, but without shackling the hands that dispense it, the remedy of new trial has
been described as 'a new invention to temper the severity of a judgment or prevent the
failure of justice.[8] Thus, the Rules allow the courts to grant a new trial when there
are errors of law or irregularities prejudicial to the substantial rights of the accused
committed during the trial, or when there exists newly discovered evidence. In the
proceedings for new trial, the errors of law or irregularities are expunged from the
record or new evidence is introduced. Thereafter, the original judgment is vacated and
a new one is rendered.[9]
Under the Rules, a person convicted of a crime may avail of the remedy of new trial
before the judgment of conviction becomes final. Petitioners admit that the decision of
the Sandiganbayan in Criminal Cases Nos. 10010 and 10011 became final and
21
executory upon denial of their petition for review filed before this Court and their
motion for reconsideration. Entry of judgment has in fact been made on September 30,
1991.[10] Nonetheless, they maintain that equitable considerations exist in this case to
justify the relaxation of the Rules and re-open the case to accord petitioners the
opportunity to present evidence that will exonerate them from the charges against
them. We do not find merit in their submission.
Petitioners anchor their motion on the ground of newly discovered evidence. Courts
are generally reluctant in granting motions for new trial on the ground of newly
discovered evidence for it is presumed that the moving party has had ample
opportunity to prepare his case carefully and to secure all the necessary evidence
before the trial. Such motions are treated with great caution due to the danger of
perjury and the manifest injustice of allowing a party to allege that which may be the
consequence of his own neglect to defeat an adverse judgment. Hence, the moving
party is often required to rebut a presumption that the judgment is correct and that
there has been a lack of due diligence, and to establish other facts essential to warrant
the granting of a new trial on the ground of newly discovered evidence.[11] This Court
has repeatedly held that before a new trial may be granted on the ground of newly
discovered evidence, it must be shown (1) that the evidence was discovered after trial;
(2) that such evidence could not have been discovered and produced at the trial even
with the exercise of reasonable diligence; (3) that it is material, not merely cumulative,
corroborative, or impeaching; and (4) the evidence is of such weight that it would
probably change the judgment if admitted. If the alleged newly discovered evidence
could have been very well presented during the trial with the exercise of reasonable
diligence, the same cannot be considered newly discovered.[12]
These standards, also known as the 'Berry rule, trace their origin to the 1851 case
of Berry vs. State of Georgia [13] where the Supreme Court of Georgia held:
Applications for new trial on account of newly discovered evidence, are not favored by
the Courts. x x x Upon the following points there seems to be a pretty general
concurrence of authority, viz; that it is incumbent on a party who asks for a new trial,
on the ground of newly discovered evidence, to satisfy the Court, 1 st. That the evidence
has come to his knowledge since the trial. 2d. That it was not owing to the want of due
diligence that it did not come sooner. 3d. That it is so material that it would produce a
different verdict, if the new trial were granted. 4 th. That it is not cumulative only ' viz;
speaking to facts, in relation to which there was evidence on the trial. 5 th. That the
affidavit of the witness himself should be produced, or its absence accounted for. And
6th, a new trial will not be granted, if the only object of the testimony is to impeach the
character or credit of a witness. (citations omitted)
These guidelines have since been followed by our courts in determining the propriety
of motions for new trial based on newly discovered evidence.
It should be emphasized that the applicant for new trial has the burden of showing that
the new evidence he seeks to present has complied with the requisites to justify the
holding of a new trial.
The threshold question in resolving a motion for new trial based on newly discovered
evidence is whether the proferred evidence is in fact a 'newly discovered evidence
which could not have been discovered by due diligence. The question of whether
evidence is newly discovered has two aspects: a temporal one, i.e., when was the
evidence discovered, and a predictive one, i.e., when should or could it have been
discovered. It is to the latter that the requirement of due diligence has relevance.
[14] We have held that in order that a particular piece of evidence may be properly
regarded as newly discovered to justify new trial, what is essential is not so much the
time when the evidence offered first sprang into existence nor the time when it first
came to the knowledge of the party now submitting it; what is essential is that the
offering party had exercised reasonable diligence in seeking to locate such evidence
before or during trial but had nonetheless failed to secure it.[15]
The Rules do not give an exact definition of due diligence, and whether the movant has
exercised due diligence depends upon the particular circumstances of each case.
[16] Nonetheless, it has been observed that the phrase is often equated with reasonable
promptness to avoid prejudice to the defendant. In other words, the concept of due
diligence has both a time component and a good faith component. The movant for a
new trial must not only act in a timely fashion in gathering evidence in support of the
motion; he must act reasonably and in good faith as well. Due diligence contemplates
that the defendant acts reasonably and in good faith to obtain the evidence, in light of
the totality of the circumstances and the facts known to him.[17]
Applying the foregoing tests, we find that petitioners' purported evidence does not
qualify as newly discovered evidence that would justify the re-opening of the case and
the holding of a third trial.
The report of the forensic group may not be considered as newly discovered evidence
as petitioners failed to show that it was impossible for them to secure an independent
forensic study of the physical evidence during the trial of the double murder case. It
appears from their report that the forensic group used the same physical and
testimonial evidence proferred during the trial, but made their own analysis and
interpretation of said evidence. They cited the materials and methods that they used
for their study, viz:
MATERIALS AND METHODS
MATERIALS:
a. Court records of the case, especially photographs of: a) the stairway where the late
Sen. Aquino and his escorts descended; b) the part of the tarmac where the lifeless
22
bodies of the late Sen. Aquino and Galman fell; and c) the autopsy conducted by the
NBI Medico-legal team headed by Dr. Mu[]oz; and the autopsy report of the late Sen.
Benigno Aquino[,] Jr. signed by Dr. Mu[]oz and Dr. Solis;
b. The gun and live ammunitions collected at the crime scene;
c. A reference human skull photos and X-rays of the same to demonstrate wound
location and bullet trajectory;
d. The reports of interviews and statements by the convicted military escorts, and other
witnesses;
e. Re-enactment of the killing of Aquino based on the military escorts[] version, by the
military escorts themselves in the Bilibid Prison and by volunteers at the NAIA
Tarmac;
f. Various books and articles on forensic and the medico-legal field[;]
g. Results of Forensic experiments conducted in relation to the case.
METHODS:
a. Review of the forensic exhibits presented in the court;
b. Review of TSNs relevant to the forensic review;
c. Study of and research on the guns, slugs and ammunitions allegedly involved in the
crime;
d. Interviews/re-enactment of the crime based on the military's accounts, both in the
Bilibid Prison where the convicts are confined and the MIA (now NAIA) stairway and
tarmac;
e. Conduct of ocular inspection and measurements on the actual crime scene (stairway
and tarmac) at the old Manila International Airport (now NAIA);
f. Retracing the slug's trajectory based on the autopsy reports and experts' testimonies
using an actual human skull;
g. X-rays of the skull with the retraced trajectory based on the autopsy report and
experts' testimonies;
h. Evaluation of the presented facts and opinions of local experts in relation to
accepted forensic findings in international publications on forensic science, particularly
on guns and [gunshot] wound injuries;
i. Forensic experiments and simulations of events in relation to this case.[18]
These materials were available to the parties during the trial and there was nothing that
prevented the petitioners from using them at the time to support their theory that it was
not the military, but Rolando Galman, who killed Senator Aquino. Petitioners, in their
present motion, failed to present any new forensic evidence that could not have been
obtained by the defense at the time of the trial even with the exercise of due diligence.
If they really wanted to seek and offer the opinion of other forensic experts at the time
regarding the physical evidence gathered at the scene of the crime, there was ample
opportunity for them to do so before the case was finally submitted and decided.[19]
A reading of the Sandiganbayan decision dated September 28, 1990 shows a thorough
study by the court of the forensic evidence presented during the trial, viz:
COURT FINDINGS
As to the physical evidence
Great significance has to be accorded the trajectory of the single bullet that penetrated
the head and caused the death of Sen. Benigno Aquino, Jr. Basic to the question as to
trajectory ought to be the findings during the autopsy. The prosector in the autopsy, Dr.
Bienvenido Muoz, NBI Medico-Legal Officer, reported in his Autopsy Report No. N-
83-22-36, that the trajectory of the gunshot, the wound of entrance having been located
at the mastoid region, left, below the external auditory meatus, and the exit wound
having been at the anterior portion of the mandible, was 'forward, downward and
medially. (Autopsy Report No. N-83-22-36, Exhibit 'NNNN-2-t-2')
A controversy as to this trajectory came about when, upon being cross-examined by
counsel for the defense, Dr. Bienvenido Muoz made a significant turn-about by stating
that the correct trajectory of the fatal bullet was 'upward, downward, and medially. The
present position of Dr. Muoz is premised upon the alleged fact that he found the
petrous bone fractured, obviously hit by the fatal bullet. He concluded, in view of this
finding, that the fatal bullet must have gone upward from the wound of entrance. Since
the fatal bullet exited at the mandible, it is his belief that the petrous bone deflected the
trajectory of the bullet and, thus, the bullet proceeded downwards from the petrous
bone to the mandible.
This opinion of Dr. Bienvenido Muoz in this regard notwithstanding, We hold that the
trajectory of the fatal bullet which killed Sen. Benigno Aquino, Jr. was, indeed,
'forward, downward and medially. For the reason that the wound of entrance was at a
higher elevation than the wound of exit, there can be no other conclusion but that the
trajectory was downward. The bullet when traveling at a fast rate of speed takes a
straight path from the wound of entrance to the wound of exit. It is unthinkable that the
bullet, while projected upwards, would, instead of exiting to the roof of the head, go
down to the mandible because it was allegedly deflected by a petrous bone which
though hard is in fact a mere spongy protuberance, akin to a cartilage.
23
Clear is proof of the downward trajectory of the fatal bullet; First, as Dr. Pedro Solis
and Dr. Ceferino Cunanan, the immediate superiors of Dr. Bienvenido Muoz,
manifested before the Court, that, since the wound of entrance appeared ovaloid and
there is what is known as a contusion collar which was widest at the superior portion,
indicating an acute angle of approach, a downward trajectory of the bullet is indicated.
This phenomenon indicates that the muzzle of the fatal gun was at a level higher than
that of the point of entry of the fatal bullet.
There was no showing as to whether a probe could have been made from the wound of
entrance to the petrous bone. Out of curiosity, Dr. Juanito Billote tried to insert a probe
from the wound of exit into the petrous bone. He was unsuccessful notwithstanding
four or five attempts. If at all, this disproves the theory of Dr. Muoz that the trajectory
was upward, downward and medially. On the other hand, Dr. Juanito Billote and
photographer Alexander Loinaz witnessed the fact that Dr. Muoz[s] understudy,
Alejandrino Javier, had successfully made a probe from the wound of entrance directly
towards the wound of exit. Alejandrino Javier shouted with excitement upon his
success and Alexander Loinaz promptly photographed this event with Alejandrino
Javier holding the protruding end of the probe at the mandible. (Exhibit XXXXX-39-
A')
To be sure, had the main bullet hit the petrous bone, this spongy mash of cartilage
would have been decimated or obliterated. The fact that the main bullet was of such
force, power and speed that it was able to bore a hole into the mandible and crack it, is
an indication that it could not have been stopped or deflected by a mere petrous bone.
By its power and force, it must have been propelled by a powerful gun. It would have
been impossible for the main bullet to have been deflected form an upward course by a
mere spongy protuberance. Granting that it was so deflected, however, it could not
have maintained the same power and force as when it entered the skull at the mastoid
region so as to crack the mandible and make its exit there.
But what caused the fracture of the petrous bone? Was there a cause of the fracture,
other than that the bullet had hit it? Dr. Pedro Solis, maintaining the conclusion that the
trajectory of the bullet was downward, gave the following alternative explanations for
the fracture of the petrous bone:
First, the petrous bone could have been hit by a splinter of the main bullet, particularly,
that which was found at the temporal region; and,
Second, the fracture must have been caused by the kinetic force applied to the point of
entrance at the mastoid region which had the tendency of being radiated towards the
petrous bone.
Thus, the fracture in the occipital bone, of the temporal bone, and of the parietal bone,
Dr. Pedro Solis pointed out, had been caused by the aforesaid kinetic force. When a
force is applied to the mastoid region of the head, Dr. Pedro Solis emphasized, a
radiation of forces is distributed all over the cranial back, including, although not
limited to, the parietal bone. The skull, Dr. Solis explains, is a box-like structure. The
moment you apply pressure on the portion, a distortion, tension or some other
mechanical defect is caused. This radiation of forces produces what is known as the
'spider web linear fracture which goes to different parts of the body. The so-called
fracturing of the petrous portion of the left temporal bone is one of the consequences of
the kinetic force forcefully applied to the mastoid region.
The fact that there was found a fracture of the petrous bone is not necessarily
indicative of the theory that the main bullet passed through the petrous bone.
Doubt was expressed by Dr. Pedro Solis as to whether the metal fragments alleged by
Dr. Bienvenido Muoz to have been found by him inside the skull or at the wound of
exit were really parts of the main bullet which killed the Senator. When Dr. Pedro
Solis examined these fragments, he found that two (2) of the fragments were larger in
size, and were of such shapes, that they could not have gone out of the wound of exit
considering the size and shape of the exit wound.
Finding of a downward trajectory of the fatal bullet fatal to the credibility of defense
witnesses.
The finding that the fatal bullet which killed Sen. Benigno Aquino, Jr. was directed
downwards sustains the allegation of prosecution eyewitnesses to the effect that Sen.
Benigno Aquino, Jr. was shot by a military soldier at the bridge stairs while he was
being brought down from the plane. Rebecca Quijano saw that the senator was shot by
the military man who was directly behind the Senator while the Senator and he were
descending the stairs. Rebecca Quijano's testimony in this regard is echoed by Jessie
Barcelona, Ramon Balang, Olivia Antimano, and Mario Laher, whose testimonies this
Court finds likewise as credible.
The downward trajectory of the bullet having been established, it stands to reason that
the gun used in shooting the Senator was fired from an elevation higher than that of the
wound of entrance at the back of the head of the Senator. This is consistent with the
testimony of prosecution witnesses to the effect that the actual killer of the Senator
shot as he stood at the upper step of the stairs, the second or third behind Senator
Aquino, while Senator Aquino and the military soldiers bringing him were at the
bridge stairs. This is likewise consistent with the statement of Sandra Jean Burton that
the shooting of Senator Aquino occurred while the Senator was still on the bridge
stairs, a conclusion derived from the fact that the fatal shot was fired ten (10) seconds
after Senator Aquino crossed the service door and was led down the bridge stairs.
It was the expert finding of Dr. Matsumi Suzuki that, as was gauged from the sounds
of the footsteps of Senator Aquino, as the Senator went down the bridge stairs, the
24
shooting of the Senator occurred while the Senator had stepped on the 11 th step from
the top.
At the ocular inspection conducted by this Court, with the prosecution and the defense
in attendance, it should be noted that the following facts were established as regards
the bridge stairs:
Observations:
The length of one block covering the ' tarmac ' 196;
The width of one block covering the tarmac ' 10;
The distance from the base of the staircase leading to the emergency tube to the Ninoy
marker at the tarmac ' 126;
There are 20 steps in the staircase including the landing;
The distance from the first rung of the stairway up to the 20 th rung which is the landing
of stairs ' 208;
Distance from the first rung of the stairway up to the 20th rung until the edge of the exit
door ' 2311;
Distance from the 4th rung up to the exit door ' 21;
Distance from the 5th rung up to the exit door ' 1911;
Length of one rung including railpost ' 34;
Space between two rungs of stairway ' 9;
Width of each rung ' 11-1/2;
Length of each rung (end to end) ' 29:
Height of railpost from edge of rung to railing ' 25.
(underlining supplied)[20]
The Sandiganbayan again exhaustively analyzed and discussed the forensic evidence in
its resolution dated November 15, 1990 denying the motion for reconsideration filed
by the convicted accused. The court held:
The Autopsy Report No. N-83-2236, Exhibit 'NNNN-2-t-2 indicated a downward
trajectory of the fatal bullet when it stated that the fatal bullet was 'forward, downward,
and medially . . .
xxx
II
The wound of entrance having been at a higher elevation than the wound of exit, there
can be no other conclusion but that the trajectory was downward. The fatal bullet,
whether it be a Smith and Wesson Caliber .357 magnum revolver or a .45 caliber, must
have traveled at a fast rate of speed and it stands to reason that it took a straight path
from the wound of entrance to the wound of exit. A hole indicating this straight path
was proven to have existed. If, as contended on cross-examination by Dr. Bienvenido
Muoz, that the bullet was projected upwards, it ought to have exited at the roof of the
head. The theory that the fatal bullet was deflected by a mere petrous bone is
inconceivable.
III
Since the wound of entrance appeared ovaloid and there is what is known as a
contusion collar which was widest at the superior portion, indicating an acute angle of
approach, a downward trajectory of the fatal bullet is conclusively indicated. This
phenomenon indicates that the muzzle of the fatal gun was at a level higher than that of
the point of entry of the fatal bullet.
IV
There was no hole from the petrous bone to the mandible where the fatal bullet had
exited and, thus, there is no support to the theory of Dr. Bienvenido Muoz that the fatal
bullet had hit the petrous bone on an upward trajectory and had been deflected by the
petrous bone towards the mandible. Dr. Juanito Billote's testimony in this regard had
amplified the matter with clarity.
xxx
These physical facts, notwithstanding the arguments and protestations of counsel for
the defense as now and heretofore avowed, compel the Court to maintain the holding:
(1) that the trajectory of the fatal bullet which hit and killed Senator Benigno Aquino,
Jr. was 'forward, downward and medially; (2) that the Senator was shot by a person
who stood at a higher elevation than he; and (3) that the Senator was shot and killed by
CIC Rogelio Moreno on the bridge stairs and not on the tarmac, in conspiracy with the
rest of the accused convicted herein.[21]
This Court affirmed said findings of the Sandiganbayan when it denied the petition for
review in its resolution of July 25, 1991. The Court ruled:
The Court has carefully considered and deliberated upon all the contentions of the
petitioners but finds no basis for the allegation that the respondent Sandiganbayan has
gravely erred in resolving the factual issues.
25
The attempt to place a constitutional dimension in the petition is a labor in vain.
Basically, only questions of fact are raised. Not only is it axiomatic that the factual
findings of the Sandiganbayan are final unless they fall within specifically recognized
exceptions to the rule but from the petition and its annexes alone, it is readily apparent
that the respondent Court correctly resolved the factual issues.
xxx
The trajectory of the fatal bullet, whether or not the victim was descending the
stairway or was on the tarmac when shot, the circumstances showing conspiracy, the
participants in the conspiracy, the individual roles of the accused and their respective
parts in the conspiracy, the absence of evidence against thirteen accused and their co-
accused Col. Vicente B. Tigas, Jr., the lack of credibility of the witnesses against
former Minister Jose D. Aspiras, Director Jesus Z. Singson, Col. Arturo A. Custodio,
Hermilo Gosuico, Major General Prospero Olivas, and the shooting of Rolando
Galman are all factual matters w[h]ich the respondent court discussed with fairness and
at length. The petitioners' insistence that a few witnesses in their favor should be
believed while that of some witnesses against them should be discredited goes into the
question of credibility of witnesses, a matter which under the records of this petition is
best left to the judgment of the Sandiganbayan.[22]
The report of the forensic group essentially reiterates the theory presented by the
defense during the trial of the double murder case. Clearly, the report is not newly
discovered, but rather recently sought, which is not allowed by the Rules.[23] If at all,
it only serves to discredit the version of the prosecution which had already been
weighed and assessed, and thereafter upheld by the Sandiganbayan.
The same is true with the statement of the alleged eyewitness, SPO4 Cantimbuhan. His
narration merely corroborates the testimonies of other defense witnesses during the
trial that they saw Senator Aquino already walking on the airport tarmac toward the
AVSECOM van when a man in blue-gray uniform darted from behind and fired at the
back of the Senator's head.[24] The Sandiganbayan, however, did not give weight to
their account as it found the testimonies of prosecution eyewitnesses Rebecca Quijano
and Jessie Barcelona more credible. Quijano and Barcelona testified that they saw the
soldier behind Senator Aquino on the stairway aim and fire a gun on the latter's nape.
As earlier quoted, the Sandiganbayan found their testimonies to be more consistent
with the physical evidence. SPO4 Cantimbuhan's testimony will not in any way alter
the court's decision in view of the eyewitness account of Quijano and Barcelona, taken
together with the physical evidence presented during the trial. Certainly, a new trial
will only be allowed if the new evidence is of such weight that it would probably
change the judgment if admitted. [25] Also, new trial will not be granted if the
new evidence is merely cumulative, corroborative or impeaching.
As additional support to their motion for new trial, petitioners also claim that they were
denied due process because they were deprived of adequate legal assistance by
counsel. 'We are not persuaded. The records will bear out that petitioners were ably
represented by Atty. Rodolfo U. Jimenez during the trial and when the case was
elevated to this Court. An experienced lawyer in criminal cases, Atty. Jimenez
vigorously defended the petitioners' cause throughout the entire proceedings. The
records show that the defense presented a substantial number of witnesses and exhibits
during the trial. After the Sandiganbayan rendered its decision, Atty. Jimenez filed a
petition for review with this Court, invoking all conceivable grounds to acquit the
petitioners. When the Court denied the petition for review, he again filed a motion for
reconsideration exhausting his deep reservoir of legal talent. We therefore find
petitioners' claim to be unblushingly unsubstantiated. We note that they did not allege
any specific facts in their present motion to show that Atty. Jimenez had been remiss in
his duties as counsel. Petitioners are therefore bound by the acts and decisions of their
counsel as regards the conduct of the case. The general rule is that the client is bound
by the action of his counsel in the conduct of his case and cannot be heard to complain
that the result of the litigation might have been different had his counsel proceeded
differently.[26] We held in People vs. Umali:[27]
In criminal as well as civil cases, it has frequently been held that the fact that blunders
and mistakes may have been made in the conduct of the proceedings in the trial court,
as a result of the ignorance, inexperience, or incompetence of counsel, does not furnish
a ground for a new trial.
If such grounds were to be admitted as reasons for reopening cases, there would never
be an end to a suit so long as new counsel could be employed who could allege and
show that prior counsel had not been sufficiently diligent, or experienced, or learned.
So it has been held that mistakes of attorneys as to the competency of a witness, the
sufficiency, relevancy, materiality, or immateriality of a certain evidence, the proper
defense, or the burden of proof are not proper grounds for a new trial; and in general
the client is bound by the action of his counsel in the conduct of his case, and can not
be heard to complain that the result of the litigation might have been different had
counsel proceeded differently. (citations omitted)
Finally, we are not moved by petitioners' assertion that the forensic evidence may have
been manipulated and misinterpreted during the trial of the case. Again, petitioners did
not allege concrete facts to support their crass claim. Hence, we find the same to be
unfounded and purely speculative.
IN VIEW WHEREOF, the motion is DENIED.
SO ORDERED.
26
Note.—It has been held time and again that blunders and mistakes made in the conduct
of the proceedings in the trial court as a result of the ignorance, inexperience or
incompetence of counsel do not qualify as a ground for new trial. (Rivera vs. Court of
Appeals, 405 SCRA 61 [2003]) Custodio vs. Sandiganbayan, 453 SCRA 24, G.R. Nos.
96027-28 March 8, 2005
G.R. No. 130612. May 11, 1999.
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. BERNARDINO
DOMANTAY, @ “JUNIOR OTOT,” accused-appellant.
Constitutional Law; Custodial Investigations; R.A. No. 7438 has extended the
constitutional guarantee to situations in which an individual has not been formally
arrested but has merely been “invited” for questioning.—This provision applies to the
stage of custodial investigation, that is, “when the investigation is no longer a general
inquiry into an unsolved crime but starts to focus on a particular person as a suspect.”
R.A. No. 7438 has extended the constitutional guarantee to situations in which an
individual has not been formally arrested but has merely been “invited” for
questioning.
Same; Same; Requirements for Admissibility of Extrajudicial Confessions.—
Decisions of this Court hold that for an extrajudicial confession to be admissible, it
must satisfy the following requirements: (1) it must be voluntary; (2) it must be made
with the assistance of competent and independent counsel; (3) it must be express; and
(4) it must be in writing.
Same; Same; Exclusionary Rule; “Fruit of the Poisonous Tree” Doctrine; Words
and Phrases; Once the primary source (the “tree”) is shown to have been unlawfully
obtained, any secondary or derivative evidence (the “fruit”) derived from it is also
inadmissible.—But though he waived the assistance of counsel, the waiver was neither
put in writing nor made in the presence of counsel. For this reason, the waiver is
invalid and his confession is inadmissible. SPO1 Espinoza’s testimony on the alleged
confession of accused-appellant should have been excluded by the trial court. So is the
bayonet inadmissible in evidence, being, as it were, the “fruit of the poisonous tree.”
As explained in People v. Alicando: . . . According to this rule, once the primary
source (the “tree”) is shown to have been unlawfully obtained, any secondary or
derivative evidence (the “fruit”) derived from it is also inadmissible. Stated otherwise,
illegally seized evidence is obtained as a direct result of the illegal act, whereas the
“fruit of the poisonous tree” is the indirect result of the same illegal act. The “fruit of
the poisonous tree” is at least once removed from the illegally seized evidence, but it is
equally inadmissible. The rule is based on the principle that evidence illegally obtained
by the State should not be used to gain other evidence because the originally illegally
obtained evidence taints all evidence subsequently obtained.
Same; Same; A suspect’s confession to a radio reporter is admissible.—We agree
with the Solicitor General, however, that accused-appellant’s confession to the radio
reporter, Celso Manuel, is admissible. In People v. Andan, the accused in a rape with
homicide case confessed to the crime during interviews with the media. In holding the
confession admissible, despite the fact that the accused gave his answers without the
assistance of counsel, this Court said: [A]ppellant’s [oral] confessions to the newsmen
are not covered by Section 12(1) and (3) of Article III of the Constitution. The Bill of
Rights does not concern itself with the relation between a private individual and
another individual. It governs the relationship between the individual and the State.
The prohibitions therein are primarily addressed to the State and its agents.
Same; Same; A confession to a radio reporter is admissible where it was not shown
that said reporter was acting for the police or that the interview was conducted under
circumstances where it is apparent that the suspect confessed to the killing out of fear.
—Accused-appellant contends that “it is . . . not altogether improbable for the police
investigators to ask the police reporter (Manuel) to try to elicit some incriminating
information from the accused.” This is pure conjecture. Although he testified that he
had interviewed inmates before, there is no evidence to show that Celso was a police
beat reporter. Even assuming that he was, it has not been shown that, in conducting the
interview in question, his purpose was to elicit incriminating information from
accused-appellant. To the contrary, the media are known to take an opposite stance
against the government by exposing official wrongdoings. Indeed, there is no showing
that the radio reporter was acting for the police or that the interview was conducted
under circumstances where it is apparent that accused-appellant confessed to the
killing out of fear. As already stated, the interview was conducted on October 23,
1996, 6 days after accused-appellant had already confessed to the killing to the police.
Criminal Law; Rape with Homicide; Aggravating Circumstances; Abuse of Superior
Strength; The killing was committed with the generic aggravating circumstance of
abuse of superior strength where the record shows that the victim was six years old at
the time of the killing, a child of small build, and could not have put up much of a
defense against accused’s assault, the latter being a fully grown man of 29 years.—The
killing was committed with the generic aggravating circumstance of abuse of superior
strength. The record shows that the victim, Jennifer Domantay, was six years old at the
time of the killing. She was a child of small build, 46” in height. It is clear then that she
could not have put up much of a defense against accused-appellant’s assault, the latter
being a fully grown man of 29 years. Indeed, the physical evidence supports a finding
27
of abuse of superior strength: accused-appellant had a weapon, while the victim was
not shown to have had any; there were 38 stab wounds; and all the knife wounds are
located at the back of Jennifer’s body.
Same; Same; Same; Cruelty; The number of wounds is not a test for determining
whether there was cruelty as an aggravating circumstance—the test is whether the
accused deliberately and sadistically augmented the victim’s suffering thus, there must
be proof that the victim was made to agonize before the accused rendered the blow
which snuffed out her life.—But we think the lower court erred in finding that the
killing was committed with cruelty.The trial court appears to have been led to this
conclusion by the number of wounds inflicted on the victim. But the number of
wounds is not a test for determining whether there was cruelty as an aggravating
circumstance. “The test . . . is whether the accused deliberately and sadistically
augmented the victim’s suffering thus . . . there must be proof that the victim was made
to agonize before the [the accused] rendered the blow which snuffed out [her] life.” In
this case, there is no such proof of cruelty. Dr. Bandonill testified that any of the major
wounds on the victim’s back could have caused her death as they penetrated her heart,
lungs and liver, kidney and intestines.
Same; Same; Words and Phrases; Carnal knowledge is defined as the act of a man
having sexual intercourse or sexual bodily connections with a woman.—As the victim
here was six years old, only carnal knowledge had to be proved to establish rape.
Carnal knowledge is defined as the act of a man having sexual intercourse or sexual
bodily connections with a woman. For this purpose, it is enough if there was even the
slightest contact of the male sex organ with the labia of the victim’s genitalia.
However, there must be proof, by direct or indirect evidence, of such contact.
Same; Same; Standing alone, a physician’s finding that the hymen of the alleged
victim was lacerated does not prove rape.—Hymenal laceration is not necessary to
prove rape; neither does its presence prove its commission. As held in People v. Ulili, a
medical certificate or the testimony of the physician is presented not to prove that the
victim was raped but to show that the latter had lost her virginity. Consequently,
standing alone, a physician’s finding that the hymen of the alleged victim was
lacerated does not prove rape. It is only when this is corroborated by other evidence
proving carnal knowledge that rape may be deemed to have been established.
Same; Same; In those instances where the Supreme Court sustained convictions for
rape with homicide based on purely circumstantial evidence, the prosecution was able
to present other tell-tale signs of rape such as the location and description of the
victim’s clothings, especially her undergarments, the position of the body when found
and the like.—This Court has sustained a number of convictions for rape with
homicide based on purely circumstantial evidence. In those instances, however, the
prosecution was able to present other tell-tale signs of rape such as the location and
description of the victim’s clothings, especially her undergarments, the position of the
body when found and the like. In People v. Macalino, for instance, the Court affirmed
a conviction for the rape of a two year-old child on the basis of circumstantial
evidence: The Court notes that the testimony or medical opinion of Dr. Gajardo that
the fresh laceration had been produced by sexual intercourse is corroborated by the
testimony given by complainant Elizabeth that when she rushed upstairs upon hearing
her daughter suddenly cry out, she found appellant Macalino beside the child buttoning
his own pants and that she found some sticky fluid on the child’s buttocks and some
blood on her private part.
Same; Same; Considering the relative physical positions of the accused and the victim
in crimes of rape, the usual location of the external bodily injuries of the victim is on
the face, neck, and anterior portion of her body.—Considering the relative physical
positions of the accused and the victim in crimes of rape, the usual location of the
external bodily injuries of the victim is on the face, neck, and anterior portion of her
body. Although it is not unnatural to find contusions on the posterior side, these are
usually caused by the downward pressure on the victim’s body during the sexual
assault.It is unquestionably different when, as in this case, allthe stab wounds (except
for a minor cut in the lower left leg) had their entry points at the back running from the
upper left shoulder to the lower right buttocks.
Same; Same; Complex Crimes; Evidence; In the special complex crime of rape with
homicide, both the rape and the homicide must be established beyond reasonable
doubt.—Even assuming that Jennifer had been raped, there is no sufficient proof that it
was accused-appellant who had raped her. He did not confess to having raped the
victim. From the foregoing, we cannot find that accused-appellant also committed
rape. In the special complex crime of rape with homicide, both the rape and the
homicide must be established beyond reasonable doubt. People vs. Domantay, 307
SCRA 1, G.R. No. 130612 May 11, 1999
This case is here on appeal from the decision1 of the Regional Trial Court of Dagupan
City (Branch 57), finding accused-appellant guilty of rape with homicide and
sentencing him to death, and to indemnify the heirs of the victim in the amount
of P480,000.00, and to pay the costs.
The facts hark back to the afternoon of October 17, 1996, at around 4 oclock, when the
body of six-year old Jennifer Domantay was found sprawled amidst a bamboo grove in
Guilig, Malasiqui, Pangasinan. The childs body bore several stab wounds. Jennifer had
been missing since lunch time.
28
The medical examination conducted the following day by Dr. Ma. Fe Leticia
Macaranas, the rural health physician of Malasiqui, showed that Jennifer died of
multiple organ failure and hypovolemic shock secondary to 38 stab wounds at the
back. Dr. Macaranas found no lacerations or signs of inflammation of the outer and
inner labia and the vaginal walls of the victims genitalia, although the vaginal canal
easily admitted the little finger with minimal resistance. Noting possible commission
of acts of lasciviousness, Dr. Macaranas recommended an autopsy by a medico-legal
expert of the NBI.2
The investigation by the Malasiqui police pointed to accused-appellant Bernardino
Domantay, a cousin of the victims grandfather, as the lone suspect in the gruesome
crime. At around 6:30 in the evening of that day, police officers Montemayor, de la
Cruz, and de Guzman of the Malasiqui Philippine National Police (PNP) picked up
accused-appellant at the Malasiqui public market and took him to the police station
where accused-appellant, upon questioning by SPO1 Antonio Espinoza, confessed to
killing Jennifer Domantay. He likewise disclosed that at around 3:30 that afternoon, he
had given the fatal weapon used, a bayonet, to Elsa and Jorge Casingal, his aunt and
uncle respectively, in Poblacion Sur, Bayambang, Pangasinan. The next day, October
18, 1996, SPO1 Espinoza and another policeman took accused-appellant to
Bayambang and recovered the bayonet from a tricycle belonging to the Casingal
spouses. The police officers executed a receipt to evidence the confiscation of the
weapon.3
On the basis of the post-mortem findings of Dr. Macaranas, SPO4 Juan Carpizo, the
Philippine National Police chief investigator at Malasiqui, filed, on October 21, 1996, a
criminal complaint for murder against accused-appellant before the Municipal Trial
Court (MTC) of Malasiqui. On October 25, 1996, Dr. Ronald Bandonill, medico-legal
expert of the NBI, performed an autopsy on the embalmed body of Jennifer. The result
of his examination of the victims genitalia indicated that the childs hymen had been
completely lacerated on the right side. Based on this finding, SPO4 Carpizo amended
the criminal complaint against accused-appellant to rape with homicide. Subsequently,
the following information was filed:
That on or about the 17th day of October, 1996, in the afternoon, in barangay Guilig,
Municipality of Malasiqui, province of Pangasinan, Philippines and within the
jurisdiction of this Honorable Court, the above-named accused, with lewd design and
armed with a bayonnete, did then and there, wilfully, unlawfully and feloniously have
sexual intercourse with Jennifer Domantay, a minor of 6 years old against her will and
consent, and on the same occasion, the said accused with intent to kill, then and there,
wilfully, unlawfully and feloniously stab with the use of a bayonnete, the said Jennifer
Domantay, inflicting upon her multiple stab wounds, which resulted to her death, to the
damage and prejudice of her heirs.
At the trial, the prosecution presented seven witnesses, namely, Edward, Jiezl,
Lorenzo, all surnamed Domantay, Joselito Mejia, Antonio Espinoza, Celso Manuel,
and Dr. Ronald Bandonill, to establish its charge that accused-appellant had raped and
killed Jennifer Domantay.
Edward Domantay testified that in the morning of October 17, 1996, accused-appellant
and his two brothers-in-law, Jaime Caballero and Daudencio Macasaeb, had a round of
drinks in front of the latters house in Guilig, Malasiqui, Pangasinan. Edward Domantay
said that he was in front of Macasaebs house, tending to some pigeons in his
yard.5 After the group had consumed several bottles of San Miguel gin, accused-
appellant gave money to Edward Domantay and asked him to buy two bottles of gin
and a bottle of Sprite.6 Edward said he joined the group and sat between Daudencio
Macasaeb and accused-appellant.7 Edward said that accused-appellant, who, apparently
had one too many then, rolled up his shirt and said: No diad Antipolo tan L[i]pa et
walay massacre, diad Guilig wala, walay massacren kod dia, walay onakis-akis (In
Antipolo and Lipa, there were massacres; here in Guilig, there will also be a massacre.
I will massacre somebody here, and they will cry and cry). Edward Domantay saw that
tucked in the left side of accused-appellants waistline was a bayonet without a cover
handle.8 It was not the first time that Edward had seen accused-appellant with the knife
as the latter usually carried it with him.
Jiezl Domantay, 10, likewise testified. She said that, at about 2 oclock in the afternoon
on October 17, 1996, she and four other children were playing in front of their house in
Guilig, Malasiqui, Pangasinan. Jiezl saw accused-appellant and Jennifer Domantay
walking towards the bamboo grove of Amparo Domantay where Jennifers body was
later found. Accused-appellant was about two meters ahead of Jennifer. The bamboo
grove was about 8 to 10 meters from the house of Jiezl Domantay.10
Lorenzo Domantay, a relative of the victim, corroborated Jiezls testimony that
accused-appellant had gone to Amparo Domantays bamboo grove in the afternoon of
October 17, 1996. Lorenzo said that that afternoon, on his way to his farm, he saw
accused-appellant about 30 meters away, standing at the spot in the bamboo grove
where Jennifers body was later found. Accused-appellant appeared restless and
worried as he kept looking around. However, as Lorenzo was in a hurry, he did not try
to find out why accused-appellant appeared to be nervous.11
Prosecution witness Joselito Mejia, a tricycle driver, said that, in the afternoon of
October 17, 1996, he was about to take his lunch at home in Alacan, a neighboring
barangay about half a kilometer from Guilig, when accused-appellant implored Mejia
to take him to Malasiqui at once. Mejia told accused-appellant that he was going to
take his lunch first, but the latter pleaded with him, saying they will not be gone for
long. Mejia, therefore, agreed. Mejia noticed that accused-appellant was nervous and
afraid. Accused-appellant later changed his mind. Instead of going to the town proper,
he alighted near the Mormons church, outside Malasiqui.12
29
In addition, the prosecution presented SPO1 Antonio Espinoza and Celso Manuel who
testified that, on separate occasions, accused-appellant had confessed to the brutal
killing of Jennifer Domantay.
SPO1 Espinoza testified that he investigated accused-appellant after the latter had been
brought to the Malasiqui police station in the evening of October 17, 1996. Before he
commenced his questioning, he apprised accused-appellant of his constitutional right
to remain silent and to have competent and independent counsel, in English, which was
later translated into Pangasinense. 13 According to SPO1 Espinoza, accused-appellant
agreed to answer the questions of the investigator even in the absence of counsel and
admitted killing the victim. Accused-appellant also disclosed the location of the
bayonet he used in killing the victim. 14 On cross-examination, Espinoza admitted that
at no time during the course of his questioning was accused-appellant assisted by
counsel. Neither was accused-appellants confession reduced in writing. 15 Espinozas
testimony was admitted by the trial court over the objection of the defense.
Celso Manuel, for his part, testified that he is a radio reporter of station DWPR, an AM
station based in Dagupan City. He covers the third district of Pangasinan, including
Malasiqui. Sometime in October 1996, an uncle of the victim came to Dagupan City
and informed the station about Jennifer Domantays case. 16 On October 23, 1996,
Manuel went to Malasiqui to interview accused-appellant who was then detained in the
municipal jail. He described what transpired during the interview thus:17
PROS. QUINIT:
Q Did you introduce yourself as a media practitioner?
A Yes, sir.
Q How did you introduce yourself to the accused?
A I showed to Bernardino Domantay alias Junior Otot my I.D. card and I presented
myself as a media practitioner with my tape recorder [in] my hand, sir.
Q What was his reaction to your request for an interview?
A He was willing to state what had happened, sir.
Q What are those matters which you brought out in that interview with the accused
Bernardino Domantay alias Junior Otot?
A I asked him what was his purpose for human interests sake as a reporter, why did he
commit that alleged crime. And I asked also if he committed the crime and he
answered yes. Thats it.
....
PROS. QUINIT:
Q You mentioned about accused admitting to you on the commi[ssion] of the crime,
how did you ask him that?
A I asked him very politely.
Q More or less what have you asked him on that particular matter?
A I asked Junior Otot, Bernardino Domantay, Kung pinagsisisihan mo ba ang iyong
ginawa? Opo sabi niya, Ibig mo bang sabihin Jun, ikaw ang pumatay kay Jennifer?,
Ako nga po. The [l]ast part of my interview, Kung nakikinig ang mga magulang ni
Jennifer, ano ang gusto mong iparating?, kung gusto nilang makamtan ang hustisya ay
tatanggapin ko. That is what he said, and I also asked Junior Otot, what was his
purpose, and he said, it was about the boundary dispute, and he used that little girl in
his revenge.
On cross-examination, Manuel explained that the interview was conducted in the jail,
about two to three meters away from the police station. An uncle of the victim was
with him and the nearest policemen present were about two to three meters from him,
including those who were in the radio room. 18 There was no lawyer present. Before
interviewing accused-appellant, Manuel said he talked to the chief of police and asked
permission to interview accused-appellant. 19 On questioning by the court, Manuel said
that it was the first time he had been called to testify regarding an interview he had
conducted.20 As in the case of the testimony of SPO1 Espinoza, the defense objected to
the admission of Manuels testimony, but the lower court allowed it.
Dr. Bandonill, the NBI medico-legal who conducted an autopsy of the victim on
October 25, 1996, testified that Jennifer Domantay died as a result of the numerous
stab wounds she sustained on her back, 21 the average depth of which was six
inches.22 He opined that the wounds were probably caused by a pointed sharp-edged
instrument.23 He also noted contusions on the forehead, neck, and breast bone of the
victim.24 As for the results of the genital examination of the victim, Dr. Bandonill said
he found that the laceration on the right side of the hymen was caused within 24 hours
of her death. He added that the genital area showed signs of inflammation.25
Pacifico Bulatao, the photographer who took the pictures of the scene of the crime and
of the victim after the latters body was brought to her parents house, identified and
authenticated the five pictures (Exhibits A, B, C, D, and E) offered by the prosecution.
The defense then presented accused-appellant as its lone witness. Accused-appellant
denied the allegations against him. He testified he is an uncle of Jennifer Domantay (he
and her grandfather are cousins) and that he worked as a janitor at the Malasiqui
Municipal Hall. He said that at around 1 oclock in the afternoon of October 17, 1996,
he was bathing his pigs outside the house of his brother-in-law Daudencio Macasaeb in
30
Guilig, Malasiqui, Pangasinan. He confirmed that Daudencio was then having drinks in
front of his (Macasaebs) house. Accused-appellant claimed, however, that he did not
join in the drinking and that it was Edward Domantay, whom the prosecution had
presented as witness, and a certain Jaime Caballero who joined the party. He also
claimed that it was he whom Macasaeb had requested to buy some more liquor, for
which reason he gave money to Edward Domantay so that the latter could get two
bottles of gin, a bottle of Sprite, and a pack of cigarettes. 26 He denied Edward
Domantays claim that he (accused-appellant) had raised his shirt to show a bayonet
tucked in his waistline and that he had said he would massacre someone in Guilig.27
Accused-appellant also confirmed that, at about 2 oclock in the afternoon, he went to
Alacan passing on the trail beside the bamboo grove of Amparo Domantay. But he said
he did not know that Jennifer Domantay was following him. He further confirmed that
in Alacan, he took a tricycle to Malasiqui. The tricycle was driven by Joselito Mejia.
He said he alighted near the Mormon church, just outside of the town proper of
Malasiqui to meet his brother. As his brother did not come, accused-appellant
proceeded to town and reported for work. That night, while he was in the Malasiqui
public market, he was picked up by three policemen and brought to the Malasiqui
police station where he was interrogated by SPO1 Espinoza regarding the killing of
Jennifer Domantay. He denied having owned to the killing of Jennifer Domantay to
SPO1 Espinoza. He denied he had a grudge against the victims parents because of a
boundary dispute.28 With respect to his extrajudicial confession to Celso Manuel, he
admitted that he had been interviewed by the latter, but he denied that he ever admitted
anything to the former.29
As already stated, the trial court found accused-appellant guilty as charged. The
dispositive portion of its decision reads:30
WHEREFORE, in light of all the foregoing, the Court hereby finds the accused,
Bernardino Domantay @ Junior Otot guilty beyond reasonable doubt with the crime of
Rape with Homicide defined and penalized under Article 335 of the Revised Penal
Code in relation and as amended by Republic Act No. 7659 and accordingly, the Court
hereby sentences him to suffer the penalty of death by lethal injection, and to
indemnify the heirs of the victim in the total amount of Four Hundred Eighty Thousand
Pesos (P480,000.00),31 and to pay the costs.
SO ORDERED.
In this appeal, accused-appellant alleges that:32
I.
THE COURT A QUO ERRED IN APPRECIATING THE EXTRAJUDICIAL
CONFESSION[S] MADE BY THE ACCUSED-APPELLANT.
II.
THE COURT A QUO ERRED IN CONVICTING THE ACCUSED DESPITE
FAILURE OF THE PROSECUTION TO PROVE HIS GUILT BEYOND
REASONABLE DOUBT.
First. Accused-appellant contends that his alleged confessions to SPO1 Antonio
Espinoza and Celso Manuel are inadmissible in evidence because they had been
obtained in violation of Art. III, 12(1) of the Constitution and that, with these vital
pieces of evidence excluded, the remaining proof of his alleged guilt, consisting of
circumstantial evidence, is inadequate to establish his guilt beyond reasonable doubt.33
Art. III, 12 of the Constitution in part provides:
(1) Any person under investigation for the commission of an offense shall have the
right to be informed of his right to remain silent and to have competent and
independent counsel preferably of his own choice. If the person cannot afford the
services of counsel, he must be provided with one. These rights cannot be waived
except in writing and in the presence of counsel.
....
(3) Any confession or admission obtained in violation of this section or section 17
hereof shall be inadmissible in evidence.
This provision applies to the stage of custodial investigation, that is, when the
investigation is no longer a general inquiry into an unsolved crime but starts to focus
on a particular person as a suspect. 34 R.A. No. 7438 has extended the constitutional
guarantee to situations in which an individual has not been formally arrested but has
merely been invited for questioning.35cräläwvirtualibräry
Decisions36 of this Court hold that for an extrajudicial confession to be admissible, it
must satisfy the following requirements: (1) it must be voluntary; (2) it must be made
with the assistance of competent and independent counsel; (3) it must be express; and
(4) it must be in writing.
In the case at bar, when accused-appellant was brought to the Malasiqui police station
in the evening of October 17, 1996, 37 he was already a suspect, in fact the only one, in
the brutal slaying of Jennifer Domantay. He was, therefore, already under custodial
investigation and the rights guaranteed in Art. III, 12(1) of the Constitution applied to
him. SPO1 Espinoza narrated what transpired during accused-appellants
interrogation:38
[I] interrogated Bernardino Domantay, prior to the interrogation conducted to him, I
informed him of his constitutional right as follows; that he has the right to remain
silent; that he has the right to a competent lawyer of his own choice and if he can not
31
afford [a counsel] then he will be provided with one, and further informed [him] that
all he will say will be reduced into writing and will be used the same in the
proceedings of the case, but he told me that he will cooperate even in the absence of
his counsel; that he admitted to me that he killed Jennifer Domantay, and he revealed
also the weapon used [and] where he gave [it] to.
But though he waived the assistance of counsel, the waiver was neither put in writing
nor made in the presence of counsel. For this reason, the waiver is invalid and his
confession is inadmissible. SPO1 Espinozas testimony on the alleged confession of
accused-appellant should have been excluded by the trial court. So is the bayonet
inadmissible in evidence, being, as it were, the fruit of the poisonous tree. As explained
in People v. Alicando:39
. . . According to this rule, once the primary source (the tree) is shown to have been
unlawfully obtained, any secondary or derivative evidence (the fruit) derived from it is
also inadmissible. Stated otherwise, illegally seized evidence is obtained as a direct
result of the illegal act, whereas the "fruit of the poisonous tree is at least once
removed from the illegally seized evidence, but it is equally inadmissible. The rule is
based on the principle that evidence illegally obtained by the State should not be used
to gain other evidence because the originally illegal obtained evidence taints all
evidence subsequently obtained.
We agree with the Solicitor General, however, that accused-appellants confession to
the radio reporter, Celso Manuel, is admissible. In People v. Andan,40 the accused in a
rape with homicide case confessed to the crime during interviews with the media. In
holding the confession admissible, despite the fact that the accused gave his answers
without the assistance of counsel, this Court said:41cräläwvirtualibräry
[A]ppellants [oral] confessions to the newsmen are not covered by Section 12(1) and
(3) of Article III of the Constitution. The Bill of Rights does not concern itself with the
relation between a private individual and another individual. It governs the relationship
between the individual and the State. The prohibitions therein are primarily addressed
to the State and its agents.
Accused-appellant claims, however, that the atmosphere in the jail when he was
interviewed was tense and intimidating and was similar to that which prevails in a
custodial investigation.42 We are not persuaded. Accused-appellant was interviewed
while he was inside his cell. The interviewer stayed outside the cell and the only
person besides him was an uncle of the victim. Accused-appellant could have refused
to be interviewed, but instead, he agreed. He answered questions freely and
spontaneously. According to Celso Manuel, he said he was willing to accept the
consequences of his act.
Celso Manuel admitted that there were indeed some police officers around because
about two to three meters from the jail were the police station and the radio room. 43 We
do not think the presence of the police officers exerted any undue pressure or influence
on accused-appellant and coerced him into giving his confession.
Accused-appellant contends that it is . . . not altogether improbable for the police
investigators to ask the police reporter (Manuel) to try to elicit some incriminating
information from the accused. 44 This is pure conjecture. Although he testified that he
had interviewed inmates before, there is no evidence to show that Celso was a police
beat reporter. Even assuming that he was, it has not been shown that, in conducting the
interview in question, his purpose was to elicit incriminating information from
accused-appellant. To the contrary, the media are known to take an opposite stance
against the government by exposing official wrongdoings.
Indeed, there is no showing that the radio reporter was acting for the police or that the
interview was conducted under circumstances where it is apparent that accused-
appellant confessed to the killing out of fear. As already stated, the interview was
conducted on October 23, 1996, 6 days after accused-appellant had already confessed
to the killing to the police.
Accused-appellants extrajudicial confession is corroborated by evidence of corpus
delicti, namely, the fact of death of Jennifer Domantay. In addition, the circumstantial
evidence furnished by the other prosecution witnesses dovetails in material points with
his confession. He was seen walking toward the bamboo grove, followed by the victim.
Later, he was seen standing near the bamboo grove where the childs body was found.
Rule 133 of the Revised Rules on Evidence provides:
3. Extrajudicial confession, not sufficient ground for conviction. An extrajudicial
confession made by an accused, shall not be sufficient ground for conviction, unless
corroborated by evidence of corpus delicti.
4. Evidence necessary in treason cases. No person charged with treason shall be
convicted unless on the testimony of two witnesses to the same overt act, or on
confession in open court.
Accused-appellant argues that it was improbable for a brutal killing to have been
committed without the children who were playing about eight to ten meters from
Amparo Domantays grove, where the crime took place, having heard any
commotion.45 The contention has no merit. Accused-appellant could have covered the
young childs mouth to prevent her from making any sound. In fact, Dr. Bandonill
noted a five by two inch (5 x 2) contusion on the left side of the victims forehead,
which he said could have been caused by a hard blunt instrument or by impact as her
head hit the ground.46 The blow could have rendered her unconscious, thus precluding
her from shouting or crying.
32
Accused-appellant also contends that the testimony of Jiezl Domantay contradicts that
of Lorenzo Domantay because while Jiezl said she had seen accused-appellant walking
towards the bamboo grove, followed by the victim, at around 2 oclock in the afternoon
on October 17, 1996, Lorenzo said he saw accused-appellant standing near the bamboo
grove at about the same time.
These witnesses, however, did not testify concerning what they saw at exactly the
same time. What they told the court was what they had seen at around 2 oclock in the
afternoon. There could have been a difference in time, however little it was, between
the time Jiezl saw accused-appellant and the victim walking and the time Lorenzo saw
accused-appellant near the place where the victims body was later found. Far from
contradicting each other, these witnesses confirmed what each had said each one saw.
What is striking about their testimonies is that while Jiezl said she saw accused-
appellant going toward the bamboo grove followed by the victim at around 2 oclock in
the afternoon on October 17, 1996, Lorenzo said he had seen accused-appellant near
the bamboo grove at around that time. He described accused-appellant as nervous and
worried. There is no reason to doubt the claim of these witnesses. Lorenzo is a relative
of accused-appellant. There is no reason he would testify falsely against the latter.
Jiezl, on the other hand, is also surnamed Domantay and could also be related to
accused-appellant and has not been shown to have any reason to testify falsely against
accused-appellant. At the time of the incident, she was only 10 years old.
For the foregoing reasons, the Court is convinced of accused-appellants guilt with
respect to the killing of the child. It is clear that the prosecution has proven beyond
reasonable doubt that accused-appellant is guilty of homicide. Art. 249 of the Revised
Penal Code provides:
Any person who, not falling within the provisions of Article 246 [parricide] shall kill
another without the attendance of any of the circumstances enumerated in the next
preceding article [murder], shall be deemed guilty of homicide and be punished
by reclusion temporal.
The killing was committed with the generic aggravating circumstance of abuse of
superior strength. The record shows that the victim, Jennifer Domantay, was six years
old at the time of the killing. She was a child of small build, 46 in height. 47 It is clear
then that she could not have put up much of a defense against accused-appellants
assault, the latter being a fully grown man of 29 years. Indeed, the physical evidence
supports a finding of abuse of superior strength: accused-appellant had a weapon,
while the victim was not shown to have had any; there were 38 stab wounds; and all
the knife wounds are located at the back of Jennifers body.
But we think the lower court erred in finding that the killing was committed with
cruelty.48 The trial court appears to have been led to this conclusion by the number of
wounds inflicted on the victim. But the number of wounds is not a test for determining
whether there was cruelty as an aggravating circumstance. 49 The test . . . is whether the
accused deliberately and sadistically augmented the victims suffering thus . . . there
must be proof that the victim was made to agonize before the [the accused] rendered
the blow which snuffed out [her] life. 50 In this case, there is no such proof of cruelty.
Dr. Bandonill testified that any of the major wounds on the victims back could have
caused her death as they penetrated her heart, lungs and liver, kidney and
intestines.51cräläwvirtualibräry
Second. There is, however, no sufficient evidence to hold accused-appellant guilty of
raping Jennifer Domantay. Art. 335 of the Revised Penal Code, as amended, in part
provides:
ART. 335. When and how rape is committed. Rape is committed by having carnal
knowledge of a woman under any of the following circumstances.
1. By using force or intimidation;
2. When the woman is deprived of reason or otherwise unconscious; and
3. When the woman is under twelve years of age or is demented.
As the victim here was six years old, only carnal knowledge had to be proved to
establish rape. Carnal knowledge is defined as the act of a man having sexual
intercourse or sexual bodily connections with a woman. 52 For this purpose, it is enough
if there was even the slightest contact of the male sex organ with the labia of the
victims genitalia.53 However, there must be proof, by direct or indirect evidence, of
such contact.
Dr. Ronald Bandonills report on the genital examination he had performed on the
deceased reads:54cräläwvirtualibräry
GENITAL EXAMINATION; showed a complete laceration of the right side of the
hymen. The surrounding genital area shows signs of inflamation.
....
REMARKS: 1) Findings at the genital area indicate the probability of penetration of
that area by a hard, rigid instrument.
Hymenal laceration is not necessary to prove rape; 55 neither does its presence prove its
commission. As held in People v. Ulili,56 a medical certificate or the testimony of the
physician is presented not to prove that the victim was raped but to show that the latter
had lost her virginity. Consequently, standing alone, a physicians finding that the
hymen of the alleged victim was lacerated does not prove rape. It is only when this is
corroborated by other evidence proving carnal knowledge that rape may be deemed to
have been established.57cräläwvirtualibräry
33
This conclusion is based on the medically accepted fact that a hymenal tear may be
caused by objects other than the male sex organ 58 or may arise from other causes. 59 Dr.
Bandonill himself admitted this. He testified that the right side of the victims hymen
had been completely lacerated while the surrounding genital area showed signs of
inflammation.60 He opined that the laceration had been inflicted within 24 hours of the
victims death and that the inflammation was due to a trauma in that area. 61 When asked
by the private prosecutor whether the lacerations of the hymen could have been caused
by the insertion of a male organ he said this was possible. But he also said when
questioned by the defense that the lacerations could have been caused by something
blunt other than the male organ. Thus, he testified:62
PROS. F. QUINIT:
Q Now, what might have caused the complete laceration of the right side of the hymen,
doctor?
A Well, sir, if you look at my report there is a remark and it says there; findings at the
genital area indicated the probability of penetration of that area by a hard rigid
instrument.
Q Could it have been caused by a human organ?
A If the human male organ is erect, fully erect and hard then it is possible, sir.
....
ATTY. VALDEZ:
Q In your remarks; finding at the genital area indicates the probability of penetration of
that area by a hard rigid instrument, this may have also been caused by a dagger used
in the killing of Jennifer Domantay is that correct?
A Well, sir when I say hard rigid instrument it should not be sharp pointed and sharp
rigid, it should be a hard bl[u]nt instrument.
Q Do you consider a bolo a bl[u]nt instrument, or a dagger?
A The dagger is a sharp rigid but it is not a bl[u]nt instrument, sir.
Q This Genital Examination showed a complete laceration of the right side of the
hymen, this may have been possibly caused by a dagger, is it not?
A No, sir. I wont say that this would have been caused by a dagger, because a dagger
would have made at its incision . . . not a laceration, sir.
Q But this laceration may also have been caused by other factors other the human male
organ, is that correct?
A A hard bl[u]nt instrument, sir could show.
Q My question is other than the human male organ?
A Possible, sir.
....
COURT:
Q You mentioned that the hymen was lacerated on the right side?
A Yes, your Honor.
Q And if there is a complete erection by a human organ is this possible that the
laceration can only be on the right side of the hymen?
A Yes, your Honor, its possible.
Q How about if the penetration was done by a finger, was it the same as the human
organ?
A Well, it depends on the size of the finger that penetrat[es] the organ, if the finger is
small it could the superficial laceration, and if the finger is large then it is possible your
honor.
Q How about two fingers?
A Possible, sir.
To be sure, this Court has sustained a number of convictions for rape with homicide
based on purely circumstantial evidence. In those instances, however, the prosecution
was able to present other tell-tale signs of rape such as the location and description of
the victims clothings, especially her undergarments, the position of the body when
found and the like.63 In People v. Macalino,64 for instance, the Court affirmed a
conviction for the rape of a two year-old child on the basis of circumstantial
evidence:65
The Court notes that the testimony or medical opinion of Dr. Gajardo that the fresh
laceration had been produced by sexual intercourse is corroborated by the testimony
given by complainant Elizabeth that when she rushed upstairs upon hearing her
daughter suddenly cry out, she found appellant Macalino beside the child buttoning
his own pants and that she found some sticky fluid on the childs buttocks and some
blood on her private part. (Emphasis in the original)
34
In contrast, in the case at bar, there is no circumstantial evidence from which to infer
that accused-appellant sexually abused the victim. The only circumstance from which
such inference might be made is that accused-appellant was seen with the victim
walking toward the place where the girls body was found. Maybe he raped the girl.
Maybe he did not. Maybe he simply inserted a blunt object into her organ, thus causing
the lacerations in the hymen. Otherwise, there is no circumstance from which it might
reasonably be inferred that he abused her, e.g., that he was zipping up his pants, that
there was spermatozoa in the girls vaginal canal.
Indeed, the very autopsy report of Dr. Bandonill militates against the finding of rape.
In describing the stab wounds on the body of the victim, he testified:66
[A]fter examining the body I took note that there were several stab wounds . . . these
were all found at the back area sir . . . extending from the back shoulder down to the
lower back area from the left to the right.
Considering the relative physical positions of the accused and the victim in crimes of
rape, the usual location of the external bodily injuries of the victim is on the
face,67 neck,68 and anterior portion69 of her body. Although it is not unnatural to find
contusions on the posterior side, these are usually caused by the downward pressure on
the victims body during the sexual assault.70 It is unquestionably different when, as in
this case, all the stab wounds (except for a minor cut in the lower left leg) had their
entry points at the back running from the upper left shoulder to the lower right
buttocks.
It is noteworthy that the deceased was fully clothed in blue shorts and white shirt when
her body was brought to her parents house immediately after it was
found.71 Furthermore, there is a huge bloodstain in the back portion of her
shorts.72 This must be because she was wearing this piece of clothing when the stab
wounds were inflicted or immediately thereafter, thus allowing the blood to seep into
her shorts to such an extent. As accused-appellant would naturally have to pull down
the girls lower garments in order to consummate the rape, then, he must have,
regardless of when the stab wounds were inflicted, pulled up the victims shorts and
undergarments after the alleged rape, otherwise, the victims shorts would not have
been stained so extensively. Again, this is contrary to ordinary human experience.
Even assuming that Jennifer had been raped, there is no sufficient proof that it was
accused-appellant who had raped her. He did not confess to having raped the victim.
From the foregoing, we cannot find that accused-appellant also committed rape. In the
special complex crime of rape with homicide, both the rape and the homicide must be
established beyond reasonable doubt.73cräläwvirtualibräry
Third. The trial court ordered accused-appellant to pay the heirs of Jennifer Domantay
the amount of P30,000.00 as actual damages. However, the list of expenses produced
by the victims father, Jaime Domantay, only totaled P28,430.00. Of this amount,
only P12,000.00 was supported by a receipt. Art. 2199 of the Civil Code provides that
a party may recover actual or compensatory damages only for such loss as he has duly
proved. Therefore, the award of actual damages should be reduced to P12,000.00.
In addition, the heirs of Jennifer Domantay are entitled to recover exemplary damages
in view of the presence of the aggravating circumstance of abuse of superior strength.
Art. 2230 of the Civil Code provides for the payment of exemplary damages when the
crime is committed with one or more aggravating circumstance. An amount
of P25,000.00 is deemed appropriate.74
In accordance with our rulings in People v. Robles75 and People v. Mengote,76 the
indemnity should be fixed at P50,000.00 and the moral damages at P50,000.00.77
WHEREFORE, the judgment of the trial court is SET ASIDE and another one is
rendered FINDING accused-appellant guilty of homicide with the aggravating
circumstance of abuse of superior strength and sentencing him to a prison term of 12
years of prision mayor, as minimum, to 20 years of reclusion temporal, as maximum,
and ORDERING him to pay the heirs of Jennifer Domantay the amounts
of P50,000.00, as indemnity, P50,000.00, as moral damages, P25,000.00, as exemplary
damages, and P12,000.00, as actual damages, and the costs.
SO ORDERED.
Notes.—Statements made by the accused pertaining to stolen pieces of jewelry are
inadmissible in evidence where these were taken in violation of his rights to counsel
and to remain silent, and the pieces of jewelry recovered cannot be used also against
him since they are fruits of the poisonous tree. (People vs. Bonola, 274 SCRA 238
[1997])
Evidence secured on the occasion of an unreasonable search and seizure is tainted and
should be excluded for being the proverbial fruit of a poisonous tree. (People vs.
Montilla, 285 SCRA 703 [1998]) People vs. Domantay, 307 SCRA 1, G.R. No.
130612 May 11, 1999
35

RULE 129-Secs. 1,2 & 3
Judicial Notice
A.M. No. RTJ-92-876. September 19, 1994.
STATE PROSECUTORS, complainants, vs. JUDGE MANUEL T. MURO,
Regional Trial Court, Branch 54, Manila, respondent.
Remedial Law; Evidence; Judicial Notice; Doctrine of judicial notice rests on the
wisdom and discretion of the courts.—The doctrine of judicial notice rests on the
wisdom and discretion of the courts. The power to take judicial notice is to be
exercised by courts with caution; care must be taken that the requisite notoriety exists;
and every reasonable doubt on the subject should be promptly resolved in the negative.
Same; Same; Same; Requisites of Judicial Notice.—Generally speaking, matters of
judicial notice have three material requisites: (1) the matter must be one of common
and general knowledge; (2) it must be well and authoritatively settled and not doubtful
or uncertain; and (3) it must be known to be within the limits of the jurisdiction of the
court. The principal guide in determining what facts may be assumed to be judicially
known is that of notoriety. Hence, it can be said that judicial notice is limited to facts
evidenced by public records and facts of general notoriety.
Same; Same; Same; Judicial cognizance is taken only of those matters which are
“commonly” known.—To say that a court will take judicial notice of a fact is merely
another way of saying that the usual form of evidence will be dispensed with if
knowledge of the fact can be otherwise acquired. This is because the court assumes
that the matter is so notorious that it will not be disputed. But judicial notice is not
judicial knowledge. The mere personal knowledge of the judge is not the judicial
knowledge of the court, and he is not authorized to make his individual knowledge of a
fact, not generally or professionally known, the basis of his action. Judicial cognizance
is taken only of those matters which are “commonly” known.
Same; Same; Same; Facts which are universally known, and which may be found in
encyclopedias, dictionaries and other publications, are judicially noticed, provided they
are of such universal notoriety and so generally understood.—Things of “common
knowledge,” of which courts take judicial notice, may be matters coming to the
knowledge of men generally in the course of the ordinary experiences of life, or they
may be matters which are generally accepted by mankind as true and are capable of
ready and unquestioned demonstration. Thus, facts which are universally known, and
which may be found in encyclopedias, dictionaries or other publications, are judicially
noticed, provided they are of such universal notoriety and so generally understood that
they may be regarded as forming part of the common knowledge of every person.
Same; Same; Same; Judicial notice cannot be taken of a statute before it becomes
effective. A law which is not yet in force and hence, still inexistent, cannot be of
common knowledge capable of ready and unquestionable demonstration.—Respondent
judge, in the guise of exercising discretion and on the basis of a mere newspaper
account which is sometimes even referred to as hearsay evidence twice removed, took
judicial notice of the supposed lifting of foreign exchange controls, a matter which was
not and cannot be considered of common knowledge or of general notoriety. Worse, he
took cognizance of an administrative regulation which was not yet in force when the
order of dismissal was issued. Jurisprudence dictates that judicial notice cannot be
taken of a statute before it becomes effective. The reason is simple. A law which is not
yet in force and hence, still inexistent, cannot be of common knowledge capable of
ready and unquestionable demonstration, which is one of the requirements before a
court can take judicial notice of a fact.
Same; Same; Same.—Evidently, it was impossible for respondent judge, and it was
definitely not proper for him, to have taken cognizance of CB Circular No. 1353, when
the same was not yet in force at the time the improvident order of dismissal was issued.
Same; Same; Same; Dismissal of the eleven criminal cases without a motion to quash
having been filed by the accused, and without at least giving the prosecution the basic
opportunity to be heard on the matter is denial of due process to the Government.—
This is not a simple case of a misapplication or erroneous interpretation of the law. The
very act of respondent judge in altogether dismissing sua sponte the eleven criminal
cases without even a motion to quash having been filed by the accused, and without at
least giving the prosecution the basic opportunity to be heard on the matter by way of a
written comment or on oral argument, is not only a blatant denial of elementary due
process to the Government but is palpably indicative of bad faith and partiality.
36
Same; Same; Same.—The avowed desire of respondent judge to speedily dispose of
the cases as early as possible is no license for abuse of judicial power and discretion,
nor does such professed objective, even if true, justify a deprivation of the
prosecution’s right to be heard and a violation of its right to due process of law.
Same; Same; Same; The prosecution was not given a chance to show or prove that it
had strong evidence of the guilt of the accused.—The lightning speed, to borrow the
words of complainants, with which respondent judge resolved to dismiss the cases
without the benefit of a hearing and without reasonable notice to the prosecution
inevitably opened him to suspicion of having acted out of partiality for the accused.
Regardless of how carefully he may have evaluated changes in the factual situation and
legal standing of the cases, as a result of the newspaper report, the fact remains that he
gave the prosecution no chance whatsoever to show or prove that it had strong
evidence of the guilt of the accused. To repeat, he thereby effectively deprived the
prosecution of its right to due process.
Same; Same; Same; A display of petulance and impatience in the conduct of the trial is
a norm of conduct which is inconsistent with the “cold neutrality” of an impartial
judge.—In order that bias may not be imputed to a judge, he should have the patience
and circumspection to give the opposing party a chance to present his evidence even if
he thinks that the oppositor’s proofs might not be adequate to overthrow the case for
the other party. A display of petulance and impatience in the conduct of the trial is a
norm of conduct which is inconsistent with the “cold neutrality of an impartial judge.”
At the very least, respondent judge acted injudiciously and with unjustified haste in the
outright dismissal of the eleven cases, and thereby rendered his actuation highly
dubious.
Criminal Procedure; Double Jeopardy; Due Process; Double jeopardy cannot be
invoked against this Court’s setting aside of the trial court’s judgment of dismissal or
acquittal where the prosecution which represents the sovereign people in criminal
cases is denied due process.—It bears stressing that the questioned order of respondent
judge could have seriously and substantially affected the rights of the prosecution had
the accused invoked the defense of double jeopardy, considering that the dismissal was
ordered after arraignment and without the consent of said accused. This could have
spawned legal complications and inevitable delay in the criminal proceedings, were it
not for the holding of the Court of Appeals that respondent judge acted with grave
abuse of discretion amounting to lack of jurisdiction. This saved the day for the People
since in the absence of jurisdiction, double jeopardy will not set in. To stress this point,
and as a caveat to trial courts against falling into the same judicial error, we reiterate
what we have heretofore declared: It is settled doctrine that double jeopardy cannot be
invoked against this Court’s setting aside of the trial court’s judgment of dismissal or
acquittal where the prosecution which represents the sovereign people in criminal
cases is denied due process. x x x.
In assaying the requisite norms for qualifications and eminence of a magistrate, legal
authorities place a premium on how he has complied with his continuing duty to know
the law. A quality thus considered essential to the judicial character is that of "a man of
learning who spends tirelessly the weary hours after midnight acquainting himself with
the great body of traditions and the learning of the law; is profoundly learned in all the
learning of the law; and knows how to use that learning." 1
Obviously, it is the primary duty of a judge, which he owes to the public and to the
legal profession, to know the very law he is supposed to apply to a given controversy.
He is called upon to exhibit more than just a cursory acquaintance with the statutes and
procedural rules. Party litigants will have great faith in the administration of justice if
judges cannot justly be accused of apparent deficiency in their grasp of the legal
principles. For, service in the judiciary means a continuous study and research on the
law from beginning to end. 2
In a letter-complaint 3 dated August 19, 1992, respondent Judge Manuel T. Muro of the
Regional Trial Court (RTC) of Manila, Branch 54, was charged by State Prosecutors
Nilo C. Mariano, George C. Dee and Paterno V. Tac-an with ignorance of the law,
grave misconduct and violations of Rules 2.01, 3.01 and 3.02 of the Code of Judicial
Conduct, committed as follows:
1. That on August 13, 1992, respondent judge issued an Order dismissing eleven (11)
cases (docketed as Crim. Cases Nos. 92-101959 to 92- 101969, inclusive) filed by the
undersigned complainant prosecutors (members of the DOJ Panel of Prosecutors)
against the accused Mrs. Imelda Romualdez Marcos, for Violation of Central Bank
Foreign Exchange Restrictions, as consolidated in CB Circular No. 960, in relation to
the penal provisions of Sec. 34 of R.A. 265, as amended, . . .;
2. That respondent Judge issued his Order solely on the basis of newspaper reports
(August 11, 1992 issues of the Philippine Daily Inquirer and the Daily Globe)
concerning the announcement on August 10, 1992 by the President of the Philippines
of the lifting by the government of all foreign exchange restrictions and the arrival at
such decision by the Monetary Board as per statement of Central Bank Governor Jose
Cuisia;
3. That claiming that the reported announcement of the Executive Department on the
lifting of foreign exchange restrictions by two newspapers which are reputable and of
national circulation had the effect of repealing Central Bank Circular No. 960, as
allegedly supported by Supreme Court decisions . . ., the Court contended that it was
deprived of jurisdiction, and, therefore, motu, prop(r)io had to dismiss all the eleven
cases aforementioned "for not to do so opens this Court to charges of trying cases over
which it has no more jurisdiction;"
37
4. That in dismissing aforecited cases on August 13, 1992 on the basis of a Central
Bank Circular or Monetary Board Resolution which as of date hereof, has not even
been officially issued, and basing his Order/decision on a mere newspaper account of
the advance announcement made by the President of the said fact of lifting or
liberalizing foreign exchange controls, respondent judge acted prematurely and in
indecent haste, as he had no way of determining the full intent of the new CB Circular
or Monetary Board resolution, and whether the same provided for exception, as in the
case of persons who had pending criminal cases before the courts for violations of
Central Bank Circulars and/or regulations previously issued on the matter;
5. That respondent Judge's arrogant and cavalier posture in taking judicial notice
purportedly as a matter of public knowledge a mere newspaper account that the
President had announced the lifting of foreign exchange restrictions as basis for his
assailed order of dismissal is highly irregular, erroneous and misplaced. For the
respondent judge to take judicial notice thereof even before it is officially released by
the Central Bank and its full text published as required by law to be effective shows his
precipitate action in utter disregard of the fundamental precept of due process which
the People is also entitled to and exposes his gross ignorance of the law, thereby
tarnishing public confidence in the integrity of the judiciary. How can the Honorable
Judge take judicial notice of something which has not yet come into force and the
contents, shape and tenor of which have not yet been published and ascertained to be
the basis of judicial action? The Honorable Judge had miserably failed to "endeavor
diligently to ascertain the facts" in the case at bar contrary to Rule 3.02 of the Code of
Judicial Conduct constituting Grave Misconduct;
6. That respondent Judge did not even ha(ve) the prudence of requiring first the
comment of the prosecution on the effect of aforesaid Central Bank Circular/Monetary
Board resolution on the pending cases before dismissing the same, thereby denying the
Government of its right to due process;
7. That the lightning speed with which respondent Judge acted to dismiss the cases
may be gleaned from the fact that such precipitate action was undertaken despite
already scheduled continuation of trial dates set in the order of the court (the
prosecution having started presenting its evidence . . .) dated August 11, 1992 to wit:
August 31, September 3, 10, 21, & 23 and October 1, 1992, all at 9:30 o'clock in the
morning, in brazen disregard of all notions of fair play, thereby depriving the
Government of its right to be heard, and clearly exposing his bias and partiality; and
8. That, in fact, the motive of respondent Judge in dismissing the case without even
waiting for a motion to quash filed by the counsel for accused has even placed his
dismissal Order suspect.
Pursuant to a resolution of this Court dated September 8, 1992, respondent judge filed
his comment, 4 contending, inter alia, that there was no need to await publication of
the Central Bank (CB) circular repealing the existing law on foreign exchange controls
for the simple reason that the public announcement made by the President in several
newspapers of general circulation lifting foreign exchange controls was total, absolute,
without qualification, and was immediately effective; that having acted only on the
basis of such announcement, he cannot be blamed for relying on the erroneous
statement of the President that the new foreign exchange rules rendered moot and
academic the cases filed against Mrs. Marcos, and which was corrected only on August
17, 1992 but published in the newspapers on August 18, 1992, and only after
respondent judge had issued his order of dismissal dated August 13, 1992; that the
President was ill-advised by his advisers and, instead of rescuing the Chief Executive
from embarrassment by assuming responsibility for errors in the latter's announcement,
they chose to toss the blame for the consequence of their failures to respondent judge
who merely acted on the basis of the announcements of the President which had
become of public knowledge; that the "saving clause" under CB Circular No. 1353
specifically refers only to pending actions or investigations involving violations of CB
Circular No. 1318, whereas the eleven cases dismissed involved charges for violations
of CB Circular No. 960, hence the accused cannot be tried and convicted under a law
different from that under which she was charged; that assuming that respondent judge
erred in issuing the order of dismissal, the proper remedy should have been an appeal
therefrom but definitely not an administrative complaint for his dismissal; that a
mistake committed by a judge should not necessarily be imputed as ignorance of the
law; and that a "court can reverse or modify a doctrine but it does not show ignorance
of the justices or judges whose decisions were reversed or modified" because "even
doctrines initiated by the Supreme Court are later reversed, so how much more for the
lower courts?"
He further argued that no hearing was necessary since the prosecution had nothing to
explain because, as he theorized, "What explanation could have been given? That the
President was talking 'through his hat' (to use a colloquialism) and should not be
believed? That I should wait for the publication (as now alleged by complainants), of a
still then non-existent CB circular? . . . As it turned out, CB Circular No. 3153 (sic)
does not affect my dismissal order because the said circular's so-called saving clause
does not refer to CB Circular 960 under which the charges in the dismissed cases were
based;" that it was discretionary on him to take judicial notice of the facts which are of
public knowledge, pursuant to Section 2 of Rule 129; that the contention of
complainants that he acted prematurely and in indecent haste for basing his order of
dismissal on a mere newspaper account is contrary to the wordings of the newspaper
report wherein the President announced the lifting of controls as an accomplished fact,
not as an intention to be effected in the future, because of the use of the present perfect
tense or past tense "has lifted," not that he "intends to lift," foreign exchange controls.
Finally, respondent judge asseverates that complainants who are officers of the
Department of Justice, violated Section 6, Rule 140 of the Rules of Court which
38
provides that "proceedings against judges of first instance shall be private and
confidential" when they caused to be published in the newspapers the filing of the
present administrative case against him; and he emphasizes the fact that he had to
immediately resolve a simple and pure legal matter in consonance with the admonition
of the Supreme Court for speedy disposition of cases.
In their reply 5 and supplemental reply, 6 complainants aver that although the saving
clause under Section 16 of CB Circular No. 1353 made specific reference to CB
Circular No. 1318, it will be noted that Section 111 of Circular No. 1318, which
contains a saving clause substantially similar to that of the new circular, in turn refers
to and includes Circular No. 960. Hence, whether under Circular No. 1318 or Circular
No. 1353, pending cases involving violations of Circular No. 960 are excepted from
the coverage thereof. Further, it is alleged that the precipitate dismissal of the eleven
cases, without according the prosecution the opportunity to file a motion to quash or a
comment, or even to show cause why the cases against accused Imelda R. Marcos
should not be dismissed, is clearly reflective of respondent's partiality and bad faith. In
effect, respondent judge acted as if he were the advocate of the accused.
On December 9, 1993, this Court issued a resolution referring the complaint to the
Office of the Court Administrator for evaluation, report and recommendation, pursuant
to Section 7, Rule 140 of the Rules of Court, as revised, there being no factual issues
involved. The corresponding report and recommendation, 7 dated February 14, 1994,
was submitted by Deputy Court Administrator Juanito A. Bernad, with the approval of
Court Administrator Ernani Cruz-Paño.
The questioned order 8 of respondent judge reads as follows:
These eleven (11) cases are for Violation of Central Bank Foreign Exchange
Restrictions as consolidated in CB Circular No. 960 in relation to the penal provision
of Sec. 34 of R.A. 265, as amended.
The accused Mrs. Imelda R. Marcos pleaded not guilty to all these cases; apparently
the other accused in some of these cases, Roberto S. Benedicto, was not arrested and
therefore the Court did not acquire jurisdiction over his person; trial was commenced
as against Mrs. Marcos.
His Excellency, the President of the Philippines, announced on August 10, 1992 that
the government has lifted all foreign exchange restrictions and it is also reported that
Central Bank Governor Jose Cuisia said that the Monetary Board arrived at such
decision (issue of the Philippine Daily Inquirer, August 11, 1992 and issue of the Daily
Globe of the same date). The Court has to give full confidence and credit to the
reported announcement of the Executive Department, specially from the highest
official of that department; the Courts are charged with judicial notice of matters which
are of public knowledge, without introduction of proof, the announcement published in
at least the two newspapers cited above which are reputable and of national circulation.
Per several cases decided by the Supreme Court (People vs. Alcaras, 56 Phil. 520,
People vs. Francisco, 56 Phil. 572, People vs. Pastor, 77 Phil. 1000, People vs.
Crisanto Tamayo, 61 Phil. 225), among others, it was held that the repeal of a penal
law without re-enactment extinguishes the right to prosecute or punish the offense
committed under the old law and if the law repealing the prior penal law fails to
penalize the acts which constituted the offense defined and penalized in the repealed
law, the repealed law carries with it the deprivation of the courts of jurisdiction to try,
convict and sentence persons charged with violations of the old law prior to its repeal.
Under the aforecited decisions this doctrine applies to special laws and not only to the
crimes punishable in the Revised Penal Code, such as the Import Control Law. The
Central Bank Circular No. 960 under which the accused Mrs. Marcos is charged is
considered as a penal law because violation thereof is penalized with specific reference
to the provision of Section 34 of Republic Act 265, which penalizes violations of
Central Bank Circular No. 960, produces the effect cited in the Supreme Court
decisions and since according to the decisions that repeal deprives the Court of
jurisdiction, this Court motu proprio dismisses all the eleven (11) cases as a forestated
in the caption, for not to do so opens this Court to charges of trying cases over which it
has no more jurisdiction.
This order was subsequently assailed in a petition for certiorari filed with the Court of
Appeals, entitled "People of the Philippines vs. Hon. Manuel T. Muro, Judge, RTC of
Manila, Br. 54 and Imelda R. Marcos," docketed as CA-G.R. SP No. 29349. When
required to file her comment, private respondent Marcos failed to file any. Likewise,
after the appellate court gave due course to the petition, private respondent was
ordered, but again failed despite notice, to file an answer to the petition and to show
cause why no writ of preliminary injunction should issue. Eventually, on April 29,
1993, the Court of Appeals rendered a decision 9 setting aside the order of August 13,
1992, and reinstating Criminal Cases Nos. 92-101959 to 92-101969.
In finding that respondent judge acted in excess of jurisdiction and with grave abuse of
discretion in issuing the order of dismissal, the appellate court held that:
The order was issued motu proprio, i.e., without any motion to dismiss filed by counsel
for the accused, without giving an opportunity for the prosecution to be heard, and
solely on the basis of newspaper reports announcing that the President has lifted all
foreign exchange restrictions.
The newspaper report is not the publication required by law in order that the enactment
can become effective and binding. Laws take effect after fifteen days following the
completion of their publication in the Official Gazette or in a newspaper of general
circulation unless it is otherwise provided (Section 1, Executive Order No. 200). The
39
full text of CB Circular 1353, series of 1992, entitled "Further Liberalizing Foreign
Exchange Regulation" was published in the August 27, 1992 issue of the Manila
Chronicle, the Philippine Star and the Manila Bulletin. Per certification of the CB
Corporate Affairs Office, CB Circular No. 1353 took effect on September 2 . . . .
Considering that respondent judge admittedly had not seen the official text of CB
Circular No. 1353, he was in no position to rule judiciously on whether CB Circular
No. 960, under which the accused Mrs. Marcos is charged, was already repealed by
CB Circular No. 1353. . . .
xxx xxx xxx
A cursory reading of the . . . provision would have readily shown that the repeal of the
regulations on non-trade foreign exchange transactions is not absolute, as there is a
provision that with respect to violations of former regulations that are the subject of
pending actions or investigations, they shall be governed by the regulations existing at
the time the cause of action (arose). Thus his conclusion that he has lost jurisdiction
over the criminal cases is precipitate and hasty. Had he awaited the filing of a motion
to dismiss by the accused, and given opportunity for the prosecution to
comment/oppose the same, his resolution would have been the result of deliberation,
not speculation.
I. The doctrine of judicial notice rests on the wisdom and discretion of the courts. The
power to take judicial notice is to be exercised by courts with caution; care must be
taken that the requisite notoriety exists; and every reasonable doubt on the subject
should be promptly resolved in the negative. 10
Generally speaking, matters of judicial notice have three material requisites: (1) the
matter must be one of common and general knowledge; (2) it must be well and
authoritatively settled and not doubtful or uncertain; and (3) it must be known to be
within the limits of the jurisdiction of the court. 11 The provincial guide in determining
what facts may be assumed to be judicially known is that of notoriety. 12 Hence, it can
be said that judicial notice is limited to facts evidenced by public records and facts of
general notoriety. 13
To say that a court will take judicial notice of a fact is merely another way of saying
that the usual form of evidence will be dispensed with if knowledge of the fact can be
otherwise acquired. 14 This is because the court assumes that the matter is so notorious
that it will not be disputed. 15 But judicial notice is not judicial knowledge. The mere
personal knowledge of the judge is not the judicial knowledge of the court, and he is
not authorized to make his individual knowledge of a fact, not generally or
professionally known, the basis of his action. Judicial cognizance is taken only of those
matters which are "commonly" known. 16
Things of "common knowledge," of which courts take judicial notice, may be matters
coming to the knowledge of men generally in the course of the ordinary experiences of
life, or they may be matters which are generally accepted by mankind as true and are
capable of ready and unquestioned demonstration. 17 Thus, facts which are universally
known, and which may be found in encyclopedias, dictionaries or other publications,
are judicially noticed, provided they are of such universal notoriety and so generally
understood that they may be regarded as forming part of the common knowledge of
every person. 18
Respondent judge, in the guise of exercising discretion and on the basis of a mere
newspaper account which is sometimes even referred to as hearsay evidence twice
removed, took judicial notice of the supposed lifting of foreign exchange controls, a
matter which was not and cannot be considered of common knowledge or of general
notoriety. Worse, he took cognizance of an administrative regulation which was not yet
in force when the order of dismissal was issued. Jurisprudence dictates that judicial
notice cannot be taken of a statute before it becomes effective. 19 The reason is simple.
A law which is not yet in force and hence, still inexistent, cannot be of common
knowledge capable of ready and unquestionable demonstration, which is one of the
requirements before a court can take judicial notice of a fact.
Evidently, it was impossible for respondent judge, and it was definitely not proper for
him, to have taken cognizance of CB Circular No. 1353, when the same was not yet in
force at the time the improvident order of dismissal was issued.
II. Central Bank Circular No. 1353, which took effect on September 1, 1992, further
liberalized the foreign exchange regulations on receipts and disbursements of residents
arising from non-trade and trade transactions. Section 16 thereof provides for a saving
clause, thus:
Sec. 16. Final Provisions of CB Circular No. 1318. - All the provisions in Chapter X
of CB Circular No. 1318 insofar as they are not inconsistent with, or contrary to the
provisions of this Circular, shall remain in full force and effect: Provided, however,
that any regulation on non-trade foreign exchange transactions which has been
repealed, amended or modified by this Circular, violations of which are the subject of
pending actions or investigations, shall not be considered repealed insofar as such
pending actions or investigations are concerned, it being understood that as to such
pending actions or investigations, the regulations existing at the time the cause of
action accrued shall govern.
Respondent judge contends that the saving clause refers only to the provisions of
Circular No. 1318, whereas the eleven criminal cases he dismissed involve a violation
of CB Circular No. 960. Hence, he insists, Circular No. 960 is deemed repealed by the
new circular and since the former is not covered by the saving clause in the latter, there
40
is no more basis for the charges involved in the criminal cases which therefore warrant
a dismissal of the same. The contention is patently unmeritorious.
Firstly, the second part of the saving clause in Circular No. 1353 explicitly provides
that "any regulation on non-trade foreign transactions which has been repealed,
amended or modified by this Circular, violations of which are the subject of pending
actions or investigations, shall not be considered repealed insofar as such pending
actions or investigations are concerned, it being understood that as to such pending
actions or investigations, the regulations existing at the time the cause of action
accrued shall govern." The terms of the circular are clear and unambiguous and leave
no room for interpretation. In the case at bar, the accused in the eleven cases had
already been arraigned, had pleaded not guilty to the charges of violations of Circular
No. 960, and said cases had already been set for trial when Circular No. 1353 took
effect. Consequently, the trial court was and is supposed to proceed with the hearing of
the cases in spite of the existence of Circular No. 1353.
Secondly, had respondent judge only bothered to read a little more carefully the texts
of the circulars involved, he would have readily perceived and known that Circular No.
1318 also contains a substantially similar saving clause as that found in Circular No.
1353, since Section 111 of the former provides:
Sec. 111. Repealing clause. - All existing provisions of Circulars 365, 960 and 1028,
including amendments thereto, with the exception of the second paragraph of Section
68 of Circular 1028, as well as all other existing Central Bank rules and regulations or
parts thereof, which are inconsistent with or contrary to the provisions of this Circular,
are hereby repealed or modified accordingly: Provided, however, that regulations,
violations of which are the subject of pending actions or investigations, shall be
considered repealed insofar as such pending actions or investigations are concerned, it
being understood that as to such pending actions or investigations, the regulations
existing at the time the cause of action accrued shall govern.
It unequivocally appears from the section above quoted that although Circular No.
1318 repealed Circular No. 960, the former specifically excepted from its purview all
cases covered by the old regulations which were then pending at the time of the
passage of the new regulations. Thus, any reference made to Circular No. 1318
necessarily involves and affects Circular No. 960.
III. It has been said that next in importance to the duty of rendering a righteous
judgment is that of doing it in such a manner as will beget no suspicion of the fairness
and integrity of the judge. 20 This means that a judge should not only render a just,
correct and impartial decision but should do so in such a manner as to be free from any
suspicion as to its fairness and impartiality and as to his integrity. While a judge should
possess proficiency in law in order that he can competently construe and enforce the
law, it is more important that he should act and behave in such a manner that the
parties before him should have confidence in his impartiality. Thus, it is not enough
that he decides cases without bias and favoritism. Nor is it sufficient that he in fact rids
himself of prepossessions. His actuations should moreover inspire that belief. Like
Caesar's wife, a judge must not only be pure but beyond suspicion. 21
Moreover, it has always heretofore been the rule that in disposing of controverted
cases, judges should show their full understanding of the case, avoid the suspicion of
arbitrary conclusion, promote confidence in their intellectual integrity and contribute
useful precedents to the growth of the law. 22 A judge should be mindful that his duty is
the application of general law to particular instances, that ours is a government of laws
and not of men, and that he violates his duty as a minister of justice under such a
system if he seeks to do what he may personally consider substantial justice in a
particular case and disregards the general law as he knows it to be binding on him.
Such action may have detrimental consequences beyond the immediate controversy.
He should administer his office with due regard to the integrity of the system of the
law itself, remembering that he is not a depository of arbitrary power, but a judge
under the sanction of the law. 23 These are immutable principles that go into the very
essence of the task of dispensing justice and we see no reason why they should not be
duly considered in the present case.
The assertion of respondent judge that there was no need to await publication of
Circular No. 1353 for the reason that the public announcement made by the President
in several newspapers of general circulation lifting foreign exchange controls is total,
absolute, without qualification, and immediately effective, is beyond comprehension.
As a judge of the Regional Trial Court of Manila, respondent is supposed to be well-
versed in the elementary legal mandates on the publication of laws before they take
effect. It is inconceivable that respondent should insist on an altogether different and
illogical interpretation of an established and well-entrenched rule if only to suit his
own personal opinion and, as it were, to defend his indefensible action. It was not for
him to indulge or even to give the appearance of catering to the at-times human failing
of yielding to first impressions. 24 He having done so, in the face of the foregoing
premises, this Court is hard put to believe that he indeed acted in good faith.
IV. This is not a simple case of a misapplication or erroneous interpretation of the law.
The very act of respondent judge in altogether dismissing sua sponte the eleven
criminal cases without even a motion to quash having been filed by the accused, and
without at least giving the prosecution the basic opportunity to be heard on the matter
by way of a written comment or on oral argument, is not only a blatant denial of
elementary due process to the Government but is palpably indicative of bad faith and
partiality.
The avowed desire of respondent judge to speedily dispose of the cases as early as
possible is no license for abuse of judicial power and discretion, 25 nor does such
professed objective, even if true, justify a deprivation of the prosecution's right to be
41
heard and a violation of its right to due process of
law. 26
The lightning speed, to borrow the words of complainants, with which respondent
judge resolved to dismiss the cases without the benefit of a hearing and without
reasonable notice to the prosecution inevitably opened him to suspicion of having
acted out of partiality for the accused. Regardless of how carefully he may have
evaluated changes in the factual situation and legal standing of the cases, as a result of
the newspaper report, the fact remains that he gave the prosecution no chance
whatsoever to show or prove that it had strong evidence of the guilt of the accused. To
repeat, he thereby effectively deprived the prosecution of its right to due
process. 27 More importantly, notwithstanding the fact that respondent was not sure of
the effects and implications of the President's announcement, as by his own admission
he was in doubt whether or not he should dismiss the cases, 28 he nonetheless
deliberately refrained from requiring the prosecution to comment thereon. In a puerile
defense of his action, respondent judge can but rhetorically ask: "What explanation
could have been given? That the President was talking 'through his hat' and should not
be believed? That I should wait for the publication of a still then non- existent CB
Circular?" The pretended cogency of this ratiocination cannot stand even the minutest
legal scrutiny.
In order that bias may not be imputed to a judge, he should have the patience and
circumspection to give the opposing party a chance to present his evidence even if he
thinks that the oppositor's proofs might not be adequate to overthrow the case for the
other party. A display of petulance and impatience in the conduct of the trial is a norm
of conduct which is inconsistent with the "cold neutrality of an impartial judge." 29 At
the very least, respondent judge acted injudiciously and with unjustified haste in the
outright dismissal of the eleven cases, and thereby rendered his actuation highly
dubious.
V. It bears stressing that the questioned order of respondent judge could have seriously
and substantially affected the rights of the prosecution had the accused invoked the
defense of double jeopardy, considering that the dismissal was ordered after
arraignment and without the consent of said accused. This could have spawned legal
complications and inevitable delay in the criminal proceedings, were it not for the
holding of the Court of Appeals that respondent judge acted with grave abuse of
discretion amounting to lack of jurisdiction. This saved the day for the People since in
the absence of jurisdiction, double jeopardy will not set in. To stress this point, and as
a caveat to trial courts against falling into the same judicial error, we reiterate what we
have heretofore declared:
It is settled doctrine that double jeopardy cannot be invoked against this Court's setting
aside of the trial court's judgment of dismissal or acquittal where the prosecution which
represents the sovereign people in criminal cases is denied due process. . . . .
Where the prosecution is deprived of a fair opportunity to prosecute and prove its case,
its right to due process is thereby violated.
The cardinal precept is that where there is a violation of basic constitutional rights,
courts are ousted of their jurisdiction. Thus, the violation of the State's right to due
process raises a serious jurisdictional issue . . . which cannot be glossed over or
disregarded at will. Where the denial of the fundamental right of due process is
apparent, a decision rendered in disregard of that right is void for lack of jurisdiction . .
. . 30
It is also significant that accused Marcos, despite due notice, never submitted either her
comment on or an answer to the petition for certiorari as required by the Court of
Appeals, nor was double jeopardy invoked in her defense. This serves to further
underscore the fact that the order of dismissal was clearly unjustified and erroneous.
Furthermore, considering that the accused is a prominent public figure with a record of
influence and power, it is not easy to allay public skepticism and suspicions on how
said dismissal order came to be, to the consequent although undeserved discredit of the
entire judiciary.
VI. To hold a judge liable for rendering a manifestly unjust order through inexcusable
negligence or ignorance, it must be clearly shown that although he has acted without
malice, he failed to observe in the performance of his duty that diligence, prudence and
care which the law is entitled to exact in the rendering of any public service.
Negligence and ignorance are inexcusable if they imply a manifest injustice which
cannot be explained by a reasonable interpretation, and even though there is a
misunderstanding or error of the law applied, it nevertheless results logically and
reasonably, and in a very clear and indisputable manner, in the notorious violation of
the legal precept. 31
In the present case, a cursory perusal of the comment filed by respondent judge reveals
that no substantial argument has been advanced in plausible justification of his act. He
utterly failed to show any legal, factual, or even equitable justification for the dismissal
of the eleven criminal cases. The explanation given is no explanation at all. The
strained and fallacious submissions therein do not speak well of respondent and cannot
but further depreciate his probity as a judge. On this point, it is best that pertinent
unedited excerpts from his comment 32 be quoted by way of graphic illustration and
emphasis:
On the alleged ignorance of the law imputed to me, it is said that I issued the Order
dismissing the eleven (11) cases against Mrs. Imelda R. Marcos on the basis of
newspaper reports referred to in paragraph 2 of the letter complaint without awaiting
the official publication of the Central Bank Circular. Ordinarily a Central Bank
Circular/Resolution must be published in the Official Gazette or in a newspaper of
general circulation, but the lifting of "all foreign exchange controls" was announced by
42
the President of the Philippines WITHOUT QUALIFICATIONS; as published in the
Daily Globe, August 11, 1992" the government has lifted ALL foreign exchange
controls," and in the words of the Philippine Daily Inquirer report of the same date
"The government yesterday LIFTED the LAST remaining restrictions on foreign
exchange transactions, . . ." (emphasis in both quotations supplied) not only the
President made the announcement but also the Central Bank Governor Jose Cuisia
joined in the announcement by saying that "the Monetary Board arrived at the decision
after noting how the "partial liberalization" initiated early this year worked."
Therefore, because of the ABSOLUTE lifting of ALL restrictions on foreign exchange
transactions, there was no need to await the publication of the repealing circular of the
Central Bank. The purpose of requiring publication of laws and administrative rules
affecting the public is to inform the latter as to how they will conduct their affairs and
how they will conform to the laws or the rules. In this particular case, with the total
lifting of the controls, there is no need to await publication. It would have been
different if the circular that in effect repealed Central Bank Circular No. 960, under
which the accused was charged in the cases dismissed by me, had provided for
penalties and/or modified the provisions of said Circular No. 960.
The Complainants state that the lifting of controls was not yet in force when I
dismissed the cases but it should be noted that in the report of the two (2) newspapers
aforequoted, the President's announcement of the lifting of controls was stated in the
present perfect tense (Globe) or past tense (Inquirer). In other words, it has already
been lifted; the announcement did not say that the government INTENDS to lift all
foreign exchange restrictions but instead says that the government "has LIFTED all
foreign exchange controls," and in the other newspaper cited above, that "The
government yesterday lifted the last remaining restrictions on foreign exchange
transactions". The lifting of the last remaining exchange regulations effectively
cancelled or repealed Circular No. 960.
The President, who is the Chief Executive, publicly announced the lifting of all foreign
exchange regulations. The President has within his control directly or indirectly the
Central Bank of the Philippines, the Secretary of Finance being the Chairman of the
Monetary Board which decides the policies of the Central Bank.
No official bothered to correct or qualify the President's announcement of August 10,
published the following day, nor made an announcement that the lifting of the controls
do not apply to cases already pending, not until August 17 (the fourth day after my
Order, and the third day after report of said order was published) and after the
President said on August 17, reported in the INQUIRER's issue of August 18, 1992,
that the "new foreign exchange rules have nullified government cases against Imelda
R. Marcos, telling reporters that the charges against the widow of former President
Marcos "have become moot and academic" because of new ruling(s) which allow free
flow of currency in and out of the country" (Note, parenthetically, the reference to
"new rules" not to "rules still to be drafted"). The INQUIRER report continues: "A few
hours later, presidential spokeswoman Annabelle Abaya said, RAMOS (sic) had
"corrected himself'." "He had been belatedly advised by the Central Bank Governor
Jose Cuisia and Justice Secretary Franklin Drilon that the Monetary Board Regulation
excluded from its coverage all criminal cases pending in court and such a position shall
stand legal scrutiny', Mrs. Abaya, said."
I will elaborate on two points:
1. If the President was wrong in making the August 10 announcement (published in
August 11, 1992, newspapers) and in the August 17 announcement, SUPRA, and thus I
should have relied on the Presidential announcements, and there is basis to conclude
that the President was at the very least ILL-SERVED by his financial and legal
advisers, because no one bothered to advise the President to correct his
announcements, not until August 17, 1992, a few hours after the President had made
another announcement as to the charges against Imelda Marcos having been rendered
moot and academic. The President has a lot of work to do, and is not, to my
knowledge, a financier, economist, banker or lawyer. It therefore behooved his
subalterns to give him timely (not "belated") advice, and brief him on matters of
immediate and far-reaching concerns (such as the lifting of foreign exchange controls,
designed, among others to encourage the entry of foreign investments). Instead of
rescuing the Chief Executive from embarrassment by assuming responsibility for
errors in the latter's announcement, these advisers have chosen to toss the blame for the
consequence of their failing to me, who only acted on the basis of announcements of
their Chief, which had become of public knowledge.
x x x           x x x          x x x
The Court strongly feels that it has every right to assume and expect that respondent
judge is possessed with more than ordinary credentials and qualifications to merit his
appointment as a presiding judge in the Regional Trial Court of the National Capital
Judicial Region, stationed in the City of Manila itself. It is, accordingly, disheartening
and regrettable to note the nature of the arguments and the kind of logic that
respondent judge would want to impose on this Court notwithstanding the manifest
lack of cogency thereof. This calls to mind similar scenarios and how this Court
reacted thereto.
In one case, an RTC Judge was administratively charged for acquitting the accused of
a violation of CB Circular No. 960 despite the fact that the accused was apprehended
with US$355,349.00 while boarding a plane for Hongkong, erroneously ruling that the
State must first prove criminal intent to violate the law and benefit from the illegal act,
and further ordering the return of US$3,000.00 out of the total amount seized, on the
mistaken interpretation that the CB circular exempts such amount from seizure.
43
Respondent judge therein was ordered dismissed from the government service for
gross incompetence and ignorance of the law. 33
Subsequently, the Court dismissed another RTC judge, with forfeiture of retirement
benefits, for gross ignorance of the law and for knowingly rendering an unjust order or
judgment when he granted bail to an accused charged with raping an 11-year old girl,
despite the contrary recommendation of the investigating judge, and thereafter granted
the motion to dismiss the case allegedly executed by the complainant. 34
Similarly, an RTC judge who was described by this Court as one "who is ignorant of
fairly elementary and quite familiar legal principles and administrative regulations, has
a marked penchant for applying unorthodox, even strange theories and concepts in the
adjudication of controversies, exhibits indifference to and even disdain for due process
and the rule of law, applies the law whimsically, capriciously and oppressively, and
displays bias and impartiality," was dismissed from the service with forfeiture of all
retirement benefits and with prejudice to reinstatement in any branch of the
government or any of its agencies or instrumentalities. 35
Still in another administrative case, an RTJ judge was also dismissed by this Court for
gross ignorance of the law after she ordered, in a probate proceeding, the cancellation
of the certificates of title issued in the name of the complainant, without affording due
process to the latter and other interested parties. 36
Only recently, an RTC judge who had been reinstated in the service was dismissed
after he acquitted all the accused in four criminal cases for illegal possession of
firearms, on the ground that there was no proof of malice or deliberate intent on the
part of the accused to violate the law. The Court found him guilty of gross ignorance of
the law, his error of judgment being almost deliberate and tantamount to knowingly
rendering an incorrect and unjust judgment. 37
ACCORDINGLY, on the foregoing premises and considerations, the Court finds
respondent Judge Manuel T. Muro guilty of gross ignorance of the law. He is hereby
DISMISSED from the service, such dismissal to carry with it cancellation of
eligibility, forfeiture of leave credits and retirement benefits, and disqualification from
reemployment in the government service. 38
Respondent is hereby ordered to CEASE and DESIST immediately from rendering any
judgment or order, or continuing any judicial action or proceeding whatsoever,
effective upon receipt of this decision.
SO ORDERED.
Narvasa, Cruz, Feliciano, Padilla, Regalado, Davide, Jr., Romero, Bellosillo, Melo,
Quiason, Puno, Vitug and Kapunan, JJ., concur.
Bidin, is on official leave.
 
Separate Opinions
 
DISSENTING OPINION
BELLOSILLO, J.:
In other jurisdictions, it is generally accepted that judges are not accountable by way of
either civil suit or discipline for their official acts, even if clearly erroneous. Thus,
open disregard of statutes, rules, and cases has been held to be protected official
activity. Although a decision may seem so erroneous as to raise doubts concerning a
judge's integrity or physiological condition, absent extrinsic evidence, the decision
itself is insufficient to establish a case against the judge. The rule is consistent with the
concept of judicial independence. An honest judge, if he were denied the protection of
the extrinsic evidence requirement, might become unduly cautious in his work, since
he would be subject to discipline based merely upon the inferences to be drawn from
an erroneous decision. 1
In our jurisdiction, the law is no different. Thus, this Court has repeatedly held that -
. . . it is a fundamental rule of long standing that a judicial officer when required to
exercise his judgment or discretion is not criminally liable for any error he commits
provided he acts in good faith, that in the absence of malice or any wrongful conduct . .
. the judge cannot be held administratively responsible . . . for no one, called upon to
try the facts or interpret the law in the process of administering justice can be infallible
in his judgment, and to hold a judge administratively accountable for every erroneous
ruling or decision he renders . . . would be nothing short of harassment or would make
his position unbearable. 2
A judge cannot be subjected to liability - civil, criminal, or
administrative - for any of his official acts, no matter how erroneous, as long as he acts
in good faith. 3 He cannot be held to account or answer, criminally, civilly, or
administratively, for an erroneous decision rendered by him in good faith. 4 As a matter
of public policy, in the absence of fraud, dishonesty, or corruption, the acts of a judge
in his judicial capacity are not subject to disciplinary action, even though such acts are
erroneous. 5 It is a general principle of the highest importance to proper administration
of justice that a judicial officer, in exercising the authority vested in him, shall be free
to act upon his own convictions, without apprehension of personal consequences to
himself. This concept of judicial immunity rests upon consideration of public policy,
its purpose being to preserve the integrity and independence of the judiciary." 6 This
being settled doctrine, there is no choice but to apply it to the instant case.
44
The facts: Respondent Manuel T. Muro, a native of Masbate, Masbate, was appointed
on 6 November 1986 as Presiding Judge of the Regional Trial Court of Manila, Br. 54,
by then President Corazon C. Aquino. A product of the College of Law, Far Easter
University, he graduated valedictorian in 1955, magna cum laude, and placed sixth in
the Bar examinations. Now he is being charged with ignorance of the law, grave
misconduct and violations of Rules 2.01, 3.01 and 3.02 of the Code of Judicial
Conduct 7 for dismissing motu proprio the eleven (11) cases filed by the Department of
Justice Panel of Prosecutors against Ms. Imelda Romualdez Marcos for Violation of
Central Bank Foreign Exchange Restrictions after President Fidel V. Ramos had
announced, which was published in newspaper reports, the lifting of all foreign
exchange restrictions.
The majority opinion finds respondent judge guilty of gross ignorance of the law and
imposes upon him the supreme penalty of dismissal from the service, forfeiture of
leave credits and retirement benefits, and disqualification from reemployment in the
government service.
With all due respect to my esteemed colleagues, particularly to the ponente who is a
recognized authority on various fields of law, I cannot help viewing the circumstances
in a different light.
There is no dispute that the order issued by respondent judge has been reversed by the
appellate court, which reversal has now become final for failure of the accused to
appeal therefrom; hence, no damage has been caused except that complainants had to
avail of a judicial remedy to correct the mistake. But, as adverted to, the overturned
order alone does not necessarily make respondent judge liable administratively, much
more civilly or criminally. To be answerable, the fault of the judge, if any, must be
gross or patent, malicious, deliberate or done in bad faith. 8 Plainly said, fault in this
regard may exist only when the error appears to be deliberate or in bad faith. 9
Thus, bad faith is imputed against respondent judge, first, for insisting that "there was
no need to await publication of Circular No. 1353 for the reason that the public
announcement made by the President in several newspapers of general circulation
lifting foreign exchange controls is total, absolute, without qualification, and
immediately effective," 10 and, second, for "dismissing sua sponte the eleven criminal
cases without even a motion to quash having been filed by the accused, and without at
least giving the prosecution the basic opportunity to be heard on the matter." 11
But, bad faith is the neglect or refusal to fulfill a duty, not prompted by an honest
mistake, but by some interested or sinister motive. 12 It implies breach of faith and
willful failure to respond to plain and well understood obligation. 13 It does not simply
connote bad judgment or negligence; it imports a dishonest purpose or some moral
obliquity and conscious doing of wrong; it means breach of a known duty through
some motive or interest or ill will. 14
Hence, I cannot ascribe bad faith to respondent judge for I see no insidious intentions
on his part. If he insists that there really is no need to await the publication of Circular
No. 1353, as he does here, it merely shows that he sincerely believes that there is
indeed no necessity to await publication. Whether his belief is erroneous or not is thus
irrelevant. Further, dismissing motu proprio the eleven criminal cases without
affording the prosecution the opportunity to be heard on the matter, erroneous though it
may be, is not inescapably indicative of bad faith. The immediate dismissal of the
charges is a necessary consequence of the belief that since the restrictions were lifted,
no law was then being violated. It is an elementary principle in procedural law and
statutory construction that the repeal of a penal law deprives the court of jurisdiction to
punish persons charged with a violation of the old law prior to its repeal. Thus, where
the crime no longer exists, prosecution of the person charged under the old law cannot
be had and the action should be dismissed. 15
On the contrary, there is no reason why good faith should not be attributed to
respondent judge. Good faith means that the motive that actuated the conduct in
question was in fact what the actor ascribes to it, that is, that what he gives as his
motive was in truth his motive. 16 Hence, if he honestly believes that the bases for the
criminal charges against accused have been eliminated and thus strikes down the
information and consequently dismisses the charges, respondent judge cannot be
criminally, civilly, or even administratively, held liable.
Good faith and absence of malice, corrupt motives or improper consideration are
sufficient defenses protecting a judicial officer charged with ignorance of the law and
promulgation of an unjust decision from being held accountable for errors of judgment.
This, on the premise that no one called upon to try the facts or interpret the law in the
administration of justice can be infallible. 17
Respondent judge could not have seriously jeopardized the rights of the prosecution,
even if the accused invoked the defense of double jeopardy, since the remedy
of certiorari is very much available. Precisely, as has been pointed out in the majority
opinion, the defense of double jeopardy is unavailing when the prosecution is denied
due process. This is in fact the office of the prevailing doctrine - to correct
indiscretions of lower court judges - which does not necessarily make them personally
liable. In fact, if respondent judge was indeed in bad faith, he should have given the
prosecution an opportunity to be heard, and after a full-blown trial, acquitted the
accused. Then, the defense of double jeopardy would have been proper and the
accused would have gone scot-free. Thus, in Negado v. Judge Autajay, 18 this Court
affirmed the conclusions of the Investigating Justice of the Court of Appeals that
"[w]hen a person seeks administrative sanction against a judge simply because he has
committed an error in deciding the case against such person, when such error can be
elevated to a higher court for review and correction, the action of such person can only
be suspect."
45
To equate the failure of accused Marcos to comment on the petition before the
appellate court, and consequently invoke the defense of double jeopardy, with the
errancy of the assailed order, 19 may be indulging in needless speculation. And to imply
that the influence of the accused who is a prominent public figure brought about the
dismissal order is simply not borne out by the records.
Besides, the challenged order of respondent judge can hardly be considered as grossly
erroneous to merit his dismissal. For, while his reasoning may be erroneous, as it
turned out when the reversal of his decision by the appellate court became final, it is
not at all illogical as even the President of the Republic, with his learned legal advisers,
after learning of the dismissal of the cases filed by his administration against the
accused, was quoted as saying that Mrs. Marcos was an "accidental" beneficiary of the
foreign exchange deregulation policy of his administration. 20 Thus, President Fidel V.
Ramos further said that "[t]he forex deregulation applies to everybody . . . . Now the
cases filed by the government against Mrs. Marcos, numbering about 11 out of 90 have
become moot and academic because of the new regulations that have come out of the
Monetary Board, but that is to her advantage." 21 Where the conclusions of the judge in
his decision are not without logic or reason, it cannot be said that he is incompetent or
grossly ignorant. 22
It has been said that a judge, like Caesar's wife, must not only be pure but beyond
suspicion. 23 Ideally so. But the cold fact is that every overturned decision provokes
suspicion especially from the successful appellant who feels certain that the lower
court indeed erred.
It is settled that "[a] judge should be mindful that his duty is the application of general
law to a particular instance, that ours is a government of laws and not of men, and that
he violates his duty as a minister of justice under such system if he seeks to do what he
may personally consider substantial justice in a particular case and disregards the
general law as he knows it to be binding on him. Such action may have detrimental
consequences beyond the immediate controversy. He should administer his office with
due regard to the integrity of the system of the law itself, remembering that he is not a
depositary of arbitrary power, but a judge under the sanction of law." 24 As it has been
said, he must interpret the books, and not unload his ideas.
But while a judge must decide in accordance with existing laws and established
jurisprudence, his own personality, character, convictions, values, experiences and
prejudices are only sublimely insignificant and unconsciously dispensable. In every
decision he makes, he is no more and no less human, his own beliefs, perceptions and
imperfections, as well as the laws he is bound to apply, all having profound influence
on his eventual choice. Thus, Mr. Justice Cardozo of the Supreme Court of the United
States once wrote of judges: "We may try to see things as objectively as we please.
None the less, we can never see them with any eyes except our own." 25 Hence, time
and again, lower court judges, if not reversed by the Court of Appeals and this Court,
have continued to set new trails in jurisprudence without exactly conforming with what
has been settled. yet, whether reversed or merely unregarded, they do not receive
displeasure from this Court; on the contrary, they remain to be effective dispensers of
everyday justice.
In fine, there is no substantial proof, nay proof beyond reasonable doubt, that
respondent judge issued the assailed order in bad faith or with conscious and deliberate
intent to perpetrate an injustice.
Mr. Justice Malcolm, speaking for this Court In re Horilleno, 26 said that
"[i]mpeachment proceedings before courts have been said, in other jurisdictions, to be
in their nature highly penal in character and to be governed by the rules of law
applicable to criminal cases." Mr. Chief Justice Fernando, then Associate Justice of
this Court, reiterated the doctrine in Suerte v. Judge Ugbinar 27 where he said that
"[t]his is to defer the basic concept first announced in 1922 in this jurisdiction . . .
in . . . In re Horilleno that proceedings of this character being in their nature highly
penal, the charge must, therefore, be proved beyond reasonable doubt. To paraphrase
the opinion further, there is no showing of the alleged incompetence and gross
ignorance of the law by a preponderance of the evidence, much less beyond a
reasonable doubt. Such an exacting standard has been adhered to by this Court in
subsequent decisions." 28
The law always imputes good faith to judicial action, and the burden is on the one
challenging the same to prove want of it. Contraposed with the "exacting standard"
required, complainant-prosecutors in the instant case failed to prove the absence of
good faith on the part of the respondent judge. Consequently, the presumption that
official duty has been regularly performed stands.
I find it difficult to compare the instant case with those cited in the majority opinion.
In Padilla v. Judge Dizon, 29 respondent not only allowed the accused to go scot-free,
leaving the Commissioner of Customs without any relief against the accused, the
former likewise ordered the release of US$3,000.00 to the accused. Thus, respondent
judge was found guilty not only of gross ignorance of the law, but also of gross
incompetence, and grave and serious misconduct affecting his integrity and efficiency,
and was consequently dismissed from the service. And, failing to learn a lesson from
his earlier administrative case, respondent judge, after his reinstatement, this time
erroneously acquitted the defendants in four (4) different cases of illegal possession of
firearms. Finally the Court said, "[w]hen it has been clearly demonstrated, as in this
case, not only once but four (4) times, that the judge is either grossly incompetent or
grossly ignorant of the penal laws . . . . he becomes unfit to discharge his judicial
office." 30 Unlike former Judge Dizon, this is the first time respondent Judge Muro is
being administratively charged.
46
In Buenavista v. Judge Garcia, 31 the Court found respondent guilty of "serious
misconduct, gross ignorance of the law, and knowingly rendering an unjust order of
judgment" for granting bail to an accused who was charged with statutory rape, for
"improper and immoral intervention in brokering a compromise of the criminal cases"
against the accused, and thereafter for granting the motion to dismiss the rape case on
the basis of an Affidavit of Desistance allegedly executed by the victim who was then
a minor. Certainly, the actuations of the respondent judge in the cited case are far
worse than the complained indiscretions of herein respondent Judge.
32
In the proceedings instituted against Judge Jocson,   he was charged with a litany of
administrative cases, six (6) in all, i.e., from gross misconduct to gross ignorance of the
law, to incompetence, to partiality. While not all the charges were sufficiently proved,
respondent judge was found to be "ignorant of fairly elementary and quite familiar
legal principles and administrative regulations, (with) . . . a marked penchant for
applying unorthodox, even strange theories and concepts in the adjudication of
controversies, (and) exhibits indifference to, and even disdain for due process and the
rule of law, applies the law whimsically, capriciously and oppressively, and displays
bias and partiality." The Court thus observed, "[t]he different acts of misconduct
proven against respondent judge demonstrate his unfitness to remain in office and to
continue to discharge the functions and duties of a judge, and warrant the imposition
on him of the extreme sanction of dismissal from the service." There is nothing in the
records of the instant case which shows that respondent
Judge Muro, like former Judge Jocson, exhibits a pattern for applying pecant and
unaccepted theories which breed manifest and irreversible injustice.
And, in Uy v. Judge Dizon-Capulong, 33 respondent aggravated her ignorance of the
law by her refusal to abide by the Decision of the appellate court and later of this
Court, showing utter disrespect for and open defiance of higher courts. Consequently,
she was not only found guilty of gross ignorance of the law, but also of grave and
serious misconduct prejudicial to the interest of the judicial service.
Contrastingly, in a fairly recent case, 34 this Court merely imposed a fine of P10,000.00
on respondent judge who entertained the petition for bail filed by the suspects prior to
their actual arrest, notwithstanding unrefuted allegations that the accused were
allegedly relatives of the congressman who "sponsored" the appointment of respondent
to the Judiciary. In other case, 35 this Court imposed a fine of P5,000.00 on respondent
judge for ignorance of the law and grave abuse of authority after he improperly issued
a warrant of arrest and set the case for arraignment, in disregard of proper procedure.
And, still in
another, 36 this Court in dismissing the complaint filed against respondent ruled that a
judge cannot be condemned unless his error is so gross and patent as to produce an
inference of ignorance and bad faith or that he knowingly rendered an unjust decision.
In sum, there is no extrinsic evidence which shows that the assailed order of
respondent Judge Manuel T. Muro was inspired by a conscious and corrupt intent to do
a disservice and commit an atrocity, and thus his dismissal is uncalled for. Where there
is no clear indication from the records that the respondent's assailed decision was
inspired by corrupt motives or a reprehensible purpose, and while there may be a
misjudgment, but not a deliberate twisting of facts to justify the assailed order,
dismissal of respondent judge from the service is not proper. 37
Holding respondent judge liable for issuing the challenged order may curtail the
independence of judges and send the wrong signals to them who are supposed to
exercise their office without fear of reprisal, merely for expressing their uncorrupted
views. Regretfully, litigants may suffer and gain eventual justice only after costly and
long-drawn-out appeals from erroneous decisions, but these are necessary evils which
must be endured to some extent lest judicial independence and the growth of the law
be stifled.
Unlike collegial courts which afford their members the luxury of a deliberation, a trial
judge in handing down his decisions must brave the loneliness of his solitude and
independence. And, while this Court may slightly bend backwards if only to avoid
suspicion of partiality and cliquism to a brother in the profession, it must also step
forward and take the lead to defend him against unsubstantiated tirades which put to
shame and disgrace not only the magistrate on trial but the entire judicial system as
well. As champion — at other times tormentor — of trial and appellate judges, this
Court must be unrelenting in weeding the judiciary of unscrupulous judges, but it must
also be quick in dismissing administrative complaints which serve no other purpose
than to harass them. In dismissing judges from the service, the Court must be
circumspect and deliberate, lest it penalizes them for exercising their independent
judgments handed down in good faith.
Respondent judge has impressive academic and professional credentials which,
experience shows, are no longer easy to recruit for the judicial service. Above all, he
has served the judiciary with creditable distinction. It is unfeeling, if not unfair, to
purge him without extrinsic evidence of bad faith and then shatter his hopes of
ascending someday the judicial hierarchy which, after all, is the ultimate dream of
every sacrificing trial judge.
I VOTE FOR THE EXONERATION OF RESPONDENT JUDGE.
Notes.—While judges should not be disciplined for inefficiency on account merely of
occasional mistakes of errors of judgment, it is imperative that they be conversant with
basic legal principles like the one involved here. (Lim vs. Domagas, 227 SCRA 258
[1993])
47
Judge’s disregard of an established rule of law by depriving the prosecution of the
opportunity to prove that the evidence of guilt against accused was strong, amounted to
gross ignorance of the law, which is subject to disciplinary action. (Libarios vs.
Dabalos, 199 SCRA 48 [1991]) State Prosecutors vs. Muro, 236 SCRA 505, A.M. No.
RTJ-92-876 September 19, 1994
G.R. No. 90637.October 29, 1992
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. PRUDENCIO PUGAL,
ANTONIO SORIANO and RICARDO ADDUCA, accused, PRUDENCIO
PUGAL, accused-appellant.
Criminal Procedure; Evidence; Flight; There is no case law holding that non-flight is a
conclusive proof of innocence.––This, at best, is a mere conjectural pose which cannot
stand against the positive identification of the accused. Appellant’s pretended
innocence is clearlynon sequitur to his decision not to flee. Apart from the fact that
there is no case law holding that non-flight is a conclusive proof of innocence, the
argument does not hold weight in the light of the positive identification of the
appellant. The material factor here is that there is positive identification of the accused
as the author or, more accurately, co-author of the crime.
Same; Same; Same; Same; The fact that accused did not flee from the scene of the
crime is not a sufficient ground to exculpate them from the proven criminal liability.––
Generally, the decision of an accused not to flee despite an opportunity to do so is
hardly characteristic of a guilty person seeking to escape retribution for his crime. But
this is not without exceptions. In a number of cases, we have had the occasion to rule
that the fact that accused did not flee from the scene of the crime is not a sufficient
ground to exculpate them from the proven criminal liability.
Same; Same; Credibility of witnesses; Generally, the failure of a witness to report at
once to the police authorities the crime he had witnessed cannot be taken against him
for it is not uncommon for a witness to a crime to show some reluctance about getting
involved in a criminal case.––As a general rule, the failure of a witness to report at
once to the police authorities the crime he had witnessed cannot be taken against him
for it is not uncommon for a witness to a crime to show some reluctance about getting
involved in a criminal case. The natural reticence of most people to get involved in a
criminal case is of judicial notice, and the fear of eyewitnesses when townmates are
involved in the commission of the crime is understandable for they may provoke
retaliation from the accused. The delay, when adequately explained, does not impair
the credibility of the witness; neither will it render his testimony biased nor destroy its
probative value.
Same; Same; Same; Mere relationship of the witnesses to the victim does not render
their clear and positive testimony less worthy of full faith and credit.––This Court has
repeatedly held that mere relationship of the witnesses to the victim does not render
their clear and positive testimony less worthy of full faith and credit. On the contrary,
their natural interest in securing the conviction of the guilty would deter them from
implicating persons other than the culprits, for otherwise, the latter would thereby gain
immunity. Hence, the closeness of their relationship to the deceased should not,
contrary to appellant’s view, be deemed erosive of their credibility as witnesses. That
they are the wife and son of the victim does not make them incompetent as witnesses,
nor should it serve to detract from the credit otherwise due them.
Same; Same; Same; Same; It is a jurisprudentially embedded and conceded rule that
the mere fact that the witness is a relative is not a valid or sufficient ground to
disregard the former’s testimony nor does it render the same less worthy of credit in
the absence of any ill motive.––Besides, there is no iota of evidence to show that the
family of the victim was actuated by improper motives to testify falsely against the
accused. It is a jurisprudentially embedded and conceded rule that the mere fact that
the witness is a relative is not a valid or sufficient ground to disregard the former’s
testimony nor does it render the same less worthy of credit, in the absence of any ill
motive. Futhermore, the prosecution witnesses are not merely relatives of the
deceased; they are likewise victims of the robbery committed by the accused.
Same; Same; Alibi; For alibi to be given credence, it must not only appear that the
accused interposing the same was at some other place but also that it was physically
impossible for him to be at the scene of the crime at the time of its commission.––Time
and again we have stressed, virtually to the point of repletion were it not for its
48
pertinency, that alibi is one of the weakest defenses an accused can invoke because it is
easy of fabrication. It cannot prevail over the positive identification of prosecution
witnesses. To be given credence, it must not only appear that the accused interposing
the same was at some other place but also that it was physically impossible for him to
be at the scene of the crime at the time of its commission.
Same; Same; Conspiracy; Trial court did not err in finding the existence of a
conspiracy.––Finally, conspiracy has been sufficiently established in this case. The
concerted acts of the accused began with the deceased Juanito being called by Pugal
and Adduca who purposely made themselves identifiable to facilitate their entry into
the house. Once the door was opened, three of the accused who were allegedly wearing
masks entered the house while Pugal pulled Jacinto outside. Then one of the three who
entered the house stood guard at the door while the two others ransacked the place.
Thereafter, upon hearing the clapping of hands from the outside, the three malefactors
immediately left. The deceased was tied to the coconut tree and then shot to death. By
these concerted actions, it is beyond cavil that the accused acted in unison and
cooperated with each other towards the accomplishment of a common criminal design,
which was to rob the Salamancas and thereafter kill Jacinto. The trial court definitely
did not err in finding the existence of a conspiracy.
Same; Same; Same; Where conspiracy is shown to exist, the act of one is the act of
all.––Where conspiracy is shown to exist, the act of one is the act of all. While it has
not been established that it was appellant who actually shot the victim, conspiracy
having been found to exist, he is equally guilty of the crime of robbery with homicide.
Criminal Law; Robbery with homicide; Whenever homicide has been committed as a
consequence or on the occasion of the robbery, all those who took part as principals in
the robbery will also be held guilty as principals of the special complex crime of
robbery with homicide although they did not actually take part in the homicide.––The
rule is whenever homicide has been committed as a consequence or on the occasion of
the robbery, all those who took part as principals in the robbery will also be held guilty
as principals of the special complex crime of robbery with homicide although they did
not actually take part in the homicide, unless it clearly appears that they endeavored to
prevent the homicide. There is nothing in the records to show that the exception
applies in this case. People vs. Pugal, 215 SCRA 247, G.R. No. 90637 October 29,
1992
In an information 1 filed on November 5, 1985 before the Regional Trial Court of
Tabuk, Branch 25, Kalinga-Apayao, herein accused Prudencio Pugal, Antonio Soriano,
Ricardo Adduca and one Artemio Panagan were charged with the crime of "Robbery
with Homicide with the Use of Unlicensed Firearm" under Article 294, paragraph 1, of
the Revised Penal Code in relation to Presidential Decree No. 1866, committed as
follows:
That on or about the evening of July 23, 1985 at Riverside, Laya West, Tabuk,
Kalinga-Apayao and within the jurisdiction of this Honorable Court, the above-named
accused, conspiring, confederating and mutually aiding one another, with treachery
and evident premeditation, with intent to gain and by the use of force, violence and
intimidation of persons, did then and there willfully, unlawfully, and feloniously take
and carry away the amount of ONE THOUSAND (P1,000.00) Pesos, Philippine
Currency, belonging to the victim and his wife, to their damage and prejudice in said
amount, and by reason and on the occasion of said Robbery, the accused tied said
JACINTO SALAMANCA to a coconut tree and thereafter, willfully, and feloniously
shot Jacinto Salamanca on different parts of his body (and) said multiple gunshot
wounds caused his direct and immediate death.
The crime is aggravated by nocturnity, craft, dwelling, treachery and abuse of superior
strength.
ALL CONTRARY TO LAW.
Pursuant to the order of arrest issued on November 5, 1985, the accused were arrested
and committed to the custody of the Provincial Warden on November 22, 1985.
On December 4, 1985, accused Prudencio Pugal, Antonio Soriano, Ricardo Adduca
and Artemio Panagan, assisted by their defense counsel, Attys. Cesar Purugganan and
William F. Claver, were arraigned and entered a plea of not guilty to the offense
charged.
Accused Ricardo Adduca posted his bail bond and was ordered released on October 2,
1986. However, on the basis of a motion to withdraw by his bondsman, Adduca was
re-arrested and committed to the provincial jail. While detained therein, Adduca
escaped. On February 2, 1989, the trial court issued an order for his arrest but until
now he remains at large.
Accused Antonio Soriano was "receipted" for by a certain Roberto Baggay, the Acting
Mayor of Pudtol, Kalinga-Apayao, inexplicably without the approval of or an order
from the trial court authorizing him to do so. Subsequently, said accused also remained
at large.
The trial court dismissed the case as against accused Artemio Panagan upon motion of
the prosecution on the basis of an affidavit of desistance of Erlinda Salamanca, wife of
the victim, wherein she stated that the former was not one of those who killed her
husband. Trial, however, proceeded against the herein three accused since they had all
been arraigned and the absence of accused Soriano and Adduca was unjustified.
The record show that on January 11, 1989, accused Prudencio Pugal had been ordered
released from jail after filing his bail bond. However, after the promulgation of the
judgment of the trial court hereunder indicated, said court issued an order on July 17,
49
1989 cancelling his bail bond and committing him to the provincial jail where he was
accordingly detained. 2
Parenthetically, aside from the above-named accused charged in the information filed
by the Provincial Fiscal of Kalinga-Apayao, Pat. Raymund Caseñas of Pinukpuk,
Kalinga-Apayao was also charged in connection with the said killing of Jacinto
Salamanca but the case against him was forwarded to the military tribunal pursuant to
the provisions of Presidential Decree No. 1850, as amended, 3 and the same is not
involved in the present proceeding.
On July 17, 1989, the trial court rendered judgment disposing as follows:
WHEREFORE, judgment is hereby rendered finding the accused PRUDENCIO
PUGAL, RICARDO ADDUCA and ANTONIO SORIANO guilty beyond reasonable
doubt as principals of the crime of ROBBERY WITH HOMICIDE WITH THE USE
OF UNLICENSED FIREARM, defined and penalized under Article 294, in relation
with P.D. 1866, sentencing each of the accused to suffer the penalty of Reclusion
Perpetua, to indemnify jointly and severally the heirs of the deceased Jacinto
Salamanca the amount of Thirty Thousand Pesos (P30,000.00) plus Forty Thousand
Pesos (P40,000.00) moral and exemplary damages without subsidiary imprisonment in
case of insolvency pursuant to Article 39 of the Revised Penal Code and to pay the
costs.
SO ORDERED. 4
Appellant Prudencio Pugal, the lone accused who appealed to us from said decision,
assigns the following errors allegedly committed by the court a quo:
1. The trial court grievously erred in holding that the killing of the victim was
positively witnessed by prosecution witnesses Hizon and Erlinda Salamanca;
2. The lower court grievously erred in giving full evidentiary weight and credence to
the testimonies of Hizon and Erlinda Salamanca who are biased and whose testimonies
are pregnant with serious and material inconsistencies, improbabilities and shaky;
3. The lower court erred in finding that appellant Prudencio Pugal was the one who
pulled the deceased from inside the house, brought him outside and tied him to a
coconut tree;
4. The lower court erred in disregarding the plea of alibi by appellant Prudencio Pugal;
5. The lower court committed grave error in not acquitting Prudencio Pugal on ground
of reasonable doubt. 5
The prosecution presented as witnesses Hizon Salamanca, son of the deceased Jacinto
Salamanca; Erlinda Salamanca, wife of said victim; Dr. Jaime Almora; and Atty.
Wayne Odiem, whose collective testimonies establish the facts of this case as
hereunder summarized.
On July 23, 1985, at around 9:00 P.M., Erlinda Salamanca, together with her son
Hizon and daughter-in-law Lolita, was resting inside their house at Laya West, Tabuk,
Kalinga-Apayao. Her husband, Jacinto Salamanca, had just started to eat supper when
the dogs started barking and they heard and recognized the voice of Prudencio Pugal
call "Apo" three times. 6 Jacinto, who was followed by Erlinda, went to the sala and
asked, "Who are you?" Somebody answered, "Dakami," meaning "We are the ones."
When Jacinto again called out, "Who are you," the person outside replied, "We are the
ones, we came from Dagupan." Jacinto and Erlinda peeped through the jalousie
window and they saw Prudencio Pugal and Ricardo Adduca standing near the door.
The place was then lighted by a 20-watt flourescent lamp. 7
Erlinda told Jacinto to open the door. Once it was opened, however, Pugal pulled
Jacinto out of the house, and then three masked men rushed inside the house. One of
the men who had a long armalite rifle stood guard at the door, while the other two, one
of whom had a short firearm, entered the house. 8 Adduca, one of the two men who
came inside, demanded money and an armalite rifle from the occupants of the house,
and when the latter failed to produce any, Adduca ransacked the house. 9 Erlinda was
thus compelled to give her earnings for the day amounting to P1,000.00 and, in
addition, she gave the ring of her daughter-in-law. They were then ordered and forced
to lie on the floor face down. Subsequently, Erlinda and Hizon heard the clapping of
hands from outside the house. 10 Sensing that nobody was guarding them anymore,
Erlinda and Hizon crawled towards the window. From there, they saw the men drag
Jacinto and tie him to a coconut tree with a rope. Erlinda also saw Pugal slap and kick
Jacinto. Then, the man with an armalite rifle pointed his gun upwards and fired it
several times. Afterwards, he moved backward, pointed the gun at Jacinto, and shot the
latter several times. 11
The malefactors thereafter fled towards the north and when they reached the "canto"
leading to Cabaruan, another gunshot was heard. Upon seeing that the culprits were
already far away, Erlinda and Hizon rushed to where Jacinto was, only to find his
already lifeless body. Erlinda then sent Hizon to call for assistance and, in no time, the
barangay people and the police arrived at the scene of the crime. When Jacinto's body
was brought to their house, Hizon noticed that his father's false teeth were missing.
Efforts to look for the same at and near the place where Jacinto was killed proved
futile. 12
Two days after Jacinto died, Pugal went to the house of the Salamancas and handed
over to Hizon the missing artificial dentures of Jacinto which he allegedly found near
the place where the victim was killed. Puga stayed in the house of the Salamancas for
the entire duration of the wake until the ninth day of prayer. 13
50
On July 24, 1985, Dr. Jaime Almora, a resident physician at the Kalinga-Apayao
Provincial Hospital, conducted an autopsy on Jacinto Salamanca and submitted the
following —
POSTMORTEM FINDINGS
External Examination = Cadaver fully clothed, flaccid, with no sign of rigor mortis or
lividity or decomposition.
Head = Left side of skull sagging and with multiple fracture due to multiple gunshot
wounds with loss of some brain tissue and left eye.
Chest = Gunshot wound with point of entry measuring 5mm to 7mm at the 54th ics
mid clavicular line directed posteriorly, medially & horizontally exiting at the (L) mid
clavicular line level of the 8th lcs.
Extremities = R Thigh = grazing wound directed downward at the anterior upper third
of R thigh.
L Thigh = entry wound at the middle third, medial aspect of left thigh directed
laterally, posteriorly downward.
Left leg = Entry wound at the antero-medial aspect of left leg middle third with no
point of exit. Copper Jacket of Bullet recovered.
CAUSE OF DEATH: Multiple gunshot wound(s), head, chest, thigh, and leg. 14
It appears that Erlinda and Hizon Salamanca gave their sworn statements on August
16 15 and September 8, 1985, 16 respectively, both to Police Sgt. Artemio Catabay in the
investigation room of the Tabuk Police Station at Tabuk, Kalinga-Apayao.
The records further reveal that on September 24, 1985, accused Antonio Soriano,
accompanied by Sgts. Taguiam and Aquino, went to the office of prosecution witness
Atty. Wayne Odiem, District Citizen Attorney of the Citizens Legal Assistance Office,
to seek the latter's help in the taking of Soriano's confession. After having informed
Soriano of his constitutional rights to remain silent, to counsel, and to engage a counsel
of his own choice, with the requisite warnings on the possible use of his statement,
Atty. Odiem assisted Soriano while the latter gave his extrajudicial confession 17 to the
police investigators. During the investigation, Soriano, never intimated to him that the
former was coerced and threatened into giving his statement wherein he implicated
herein appellant Pugal as one of the assailants.
As against the straightforward testimonies of the two principal prosecution witnesses,
appellant could only present the defense of alibi cum denial. Pugal stated that on the
night of July 23, 1985, he was at home at Laya West, which is about one and a half
kilometers away from the house of the victim, and that he did not notice any unusual
incident that night. 18 On the other hand, the second defense witness, Lydia Magno,
testified that appellant is her uncle, that he and Adduca were part of the "ronda" which
went around the barrio, but nowhere in her testimony did she state anything about the
exact whereabouts of Adduca or appellant on that particular night. 19
I. Appellant Pugal asserts that the trial court erred in relying on the testimonies of
Erlinda and Hizon Salamanca which are allegedly replete with inconsistencies and
contradictions.
First, he contends that Hizon testified that the two men who entered the house wore
masks, whereas Erlinda testified that their faces were not covered. This inconsistency,
he claims, cannot be considered trivial.
As correctly observed by the Solicitor General, appellant was obviously confused.
Hizon's testimony was in answer to the question when the robbers were
already inside the house, while Erlinda's was with respect to the first time she saw
appellant and his co-accused who were then calling from outside the house. 20 Thus,
Hizon Salamanca stated:
Q Now, Mr. Witness, you said that particular night and time of July 23, 1985, two (2)
men entered your house, were they using mask?
A Yes, sir. 21
and the testimony of Erlinda Salamanca was as follows:
Q Now, you said you saw Prudencio Pugal and Ricardo Adduca when you
peeped with your husband through the jalous(ie). How were you able to
identify them?
A Because during that night time we used 20 watts flourescent lamp and so I
saw them there, sir.
Q How far were they — this Adduca and Pugal when you saw them?
A Pugal is near the window and Ricardo Adduca is behind Prudencio Pugal,
sir.
Q Were they in mask?
A No, they were not in mask because we opened it, if they were using a mask
we did (sic, would) not open the door, sir. 22
Furthermore, there could be no inconsistency to speak of precisely because Erlinda
likewise testified that the accused were already wearing masks when they entered the
house, in effect corroborating the testimony of Hizon on this point. Hence, in her direct
examination, Erlinda declared —
51
 Q Can you identify any of the two (2) persons who actually entered your
house?
A I can not identify the other one because he has a very tight mask but I can
identify the other one because he has a loose mask which when talking he bite
(sic) his bonnet with his mouth, sir. 23
which she further clarified in her cross-examination:
Q Let us go back to the crime when the two persons stood guard to the door
of the house, one allegedly Ricardo Adduca rushed in to search to (sic) your
belonging(s), these three (3) persons were all masked, is it not Mrs.
Salamanca?
A Yes, sir. It was only Pugal who was not masked, sir. 24
The fact that it was only appellant who was not masked was corroborated by Hizon
with the same declaration in court:
Q You said that the incident happened at around 9:00 o'clock in the night of
July 23, 1985, my question is: How could you have recognized Prudencio
Pugal as the one who pulled your father?
A It is because we have twenty (20) watts fluorescent lamp which energized
(sic) by a battery — 12 volts battery.
Q Was Prudencio Pugal masked at that time, Mr. Witness?
A No, sir. 25
Second, appellant theorizes that it is hard to believe that a person who will kill
someone who is well known in the community will not hide his face, this being
contrary to human nature and common experience. Appellant premises this postulation
on his presence at the house of the victim during the wake until the ninth day of prayer,
which fact supposedly negated any and all indicia of guilt on his part.
This, at best, is a mere conjectural pose which cannot stand against the positive
identification of the accused. Appellant's pretended innocence is clearly non
sequitur to his decision not to flee. Apart from the fact that there is no case law holding
that non-flight is a conclusive proof of innocence, the argument does not hold weight
in the light of the positive identification of the appellant. The material factor here is
that there is positive identification of the accused as the author or, more accurately, co-
author of the crime. 26
Generally, the decision of an accused not to flee despite an opportunity to do so is
hardly characteristic of a guilty person seeking to escape retribution for his
crime. 27 But this is not without exceptions. In a number of cases, we have had the
occasion to rule that the fact that accused did not flee from the scene of the crime is not
a sufficient ground to exculpate them from the proven criminal liability.
Thus, in People vs. Gardon, 28 we held: "That appellant did not flee from the scene of
the crime is not necessarily indicative of a clear conscience. He may have smugly
thought that the two men fishing on the pier would not be able to identify him, or that
they would keep "quiet about it" at his behest." In People vs. Bautista, 29 we further
ruled that:
The fact that the appellant joined the search for the victim and that he and a certain
Gabriel Madlangbayan went to Noveleta, Cavite to buy a coffin for the victim does not
disprove his culpability of the offense charged nor strengthen his claim of
innocence. . . .
. . . The solicitous attitude of appellant was part of his craft to divert attention from him
and appear blameless. Appellant assumed this posture of innocence despite his
awareness that his charged because he was doubly certain that Francisca, who feared
for her life as well as the lives of her relatives, would not expose him.
Still, in another case, this Court held that:
In some cases of murder, robbery, or even rape where a person is a prime suspect, his
not fleeing may be a badge of innocence. In the present case, however, the crime was
committed with impunity on three occasions by one who thought the victim would not
complain. Under the circumstances of this case, the appellant would most likely not
have been discovered if Josephine did not become pregnant. The appellant did not have
to flee. 30
And, finally, in People vs. Luardo, et al. 31 where the accused, as in the case at bar,
likewise attended the vigil and funeral of the deceased, the Court, did not apply the
general rule with this explanation:
The defense laid stress on the fact that appellants could have escaped, but did not. On
the contrary, both Bedico and Capio attended the vigil and funeral of the deceased and
even helped carry the bier of the latter. . . .
Verily, there is no argument on the fact that flight is indicative of guilty so that it may
be considered in favor of the accused in the case at bar that they did no escape.
Nonetheless, it has also been held by this Court that the fact that the accused did not
take flight but even helped the police to locate the supposed culprits, is not a sufficient
ground to exculpate them from the proved criminal liability.
Third, appellant asseverates that the failure of Hizon and Erlinda Salamanca to
immediately give their statements to the police (which they gave only after the lapse of
67 days after the incident took place) affects their credibility.
52
As a general rule, the failure of a witness to report at once to the police authorities the A Yes, sir.
crime he had witnessed cannot be taken against him for it is not uncommon for a
witness to a crime to show some reluctance about getting involved in a criminal case. Q They made an investigation of the crime?
The natural reticence of most people to get involved in a criminal case is of judicial A Yes, sir.
notice, and the fear of eyewitnesses when townmates are involved in the commission
of the crime is understandable for they may provoke retaliation from the accused. The Q And they asked you know (sic) the killers, is it not?
delay, when adequately explained, does not impair the credibility of the witness;
A Yes, sir.
neither will it render his testimony biased nor destroy its probative value. 32
Q And you told them you do not know because you were afraid?
In the case at bar, the two principal witnesses for the prosecution gave more than
adequate reason for their initial reluctance in giving their sworn statements to the A Yes, sir.
police, that is, fear for their safety and their lives. As a matter of fact, after the ninth
day of prayer for the deceased, the Salamancas had to leave their house and transfer to Q According to you — you stayed in Tabuk for the whole seven days that
another place in apprehension of possible reprisals from the culprits. your father was in his wake, is that correct?

When asked why he failed to immediately report and disclose the identity of the A Yes, sir.
suspects, Hizon Salamanca testified:
Q And there were many visitors who came even the Mayor of Tabuk came to
Q Now, Mr. Hizon Salamanca, in spite (of) the death of your father, in spite your house, is that correct?
of the threats of Pugal, and in spite of the fact that you mauled him before and
A Yes, sir.
you know that he is smaller than you are, you did not report his name to the
police — that he was the one who entered your house and killed your father? Q And they asked you if you know who the killers were?
A Yes, sir, because we were afraid, for fear that they might come back for us. A Yes, sir.
Q You did not even tell that to anyone else — You told it only to your Q But just the same you stick (sic) your belief that you should not tell them
mother, is that correct? the truth?
A Yes, sir. A Yes, sir.
Q You did not even tell that to your wife? COURT:
A I told this to my wife and to my brothers. Did you not know that if only you told them the identity of the killers of your
father, the police could have arrested them and put them to jail and for this
Q Who were your brothers?
reason there would be no more danger in your life?
A Raymundo and all my brothers, sir.
WITNESS:
Q You gave this information to them that Pugal was one of the murderers
Yes, but I am afraid, for fear that they might have still other companions.
immediately after the incident, is that correct?
COURT:
A No, I did not say it immediately to my brothers because they were studying
in Tuguegarao. Proceed.
Q But immediately after the killing the policemen of Tabuk came to Laya Q But when you gave your statements two months and seven days after the
West, is that correct? incident, you were no longer afraid?

53
 A No more, sir, because they were already apprehended.
Q It did not occur to you that there are still others at the time and they could
go out after you?
A No more, sir, because they (sic) already there in the jail,
depressed. 33
Fourth, appellant claims that Hizon and Erlinda are biased as witnesses considering
that they are related and very close to the deceased, hence they have the tendency to
exaggerate or give false color to their testimonies.
This Court has repeatedly held that mere relationship of the witnesses to the victim
does not render their clear and positive testimony less worthy of full faith and credit.
On the contrary, their natural interest in securing the conviction of the guilty would
deter them from implicating persons other than the culprits, for otherwise, the latter
would thereby gain immunity. 34 Hence, the closeness of their relationship to the
deceased should not, contrary to appellant's view, be deemed erosive of their
credibility as witnesses. That they are the wife and son of the victim does not make
them incompetent as witnesses, nor should it serve to detract from the credit otherwise
due them. 35
Besides, there is no iota of evidence to show that the family of the victim was actuated
by improper motives to testify falsely against the accused. It is a jurisprudentially
embedded and conceded rule that the mere fact that the witness is a relative is not a
valid or sufficient ground to disregard the former's testimony nor does it render the
same less worthy of credit, in the absence of any ill motive. 36 Furthermore, the
prosecution witnesses are not merely relatives of the deceased; they are likewise
victims of the robbery committed by the accused.
II. Appellant's defense hinges primarily on alibi. He claims though that while alibi is
the weakest of all defenses, nevertheless, where the evidence for the prosecution is
weak and betrays lack of concreteness on the question of whether or not the accused
committed the crime charged, the defense of alibi assumes importance.
Time and again we have stressed, virtually to the point of repletion were it not for its
pertinency, that alibi is one of the weakest defenses an accused can invoke 37 because it
is easy of fabrication. 38 It cannot prevail over the positive identification of prosecution
witnesses. 39 To be given credence, it must not only appear that the accused interposing
the same was at some other place but also that it was physically impossible for him to
be at the scene of the crime at the time of its commission. 40
In the case at bar, appellant was positively identified by Hizon and Erlinda. The
following observations thereon in appellee's brief accordingly merit our approval:
. . . Appellant was not only seen and recognized through his face, he was identified
also through his voice.
As testified to by both prosecution witnesses, Erlinda and Hizon, appellant was the one
who called "Apo" for three times and also the one who replied "Dakami" and
"Naggapu kami Idiay Dagupan", when asked. (TSN, p. 7 Erlinda S.; TSN, p. 9,
testimony of Salamanca). The voice of appellant is familiar to both Erlinda and Hizon
because they have had occasions in the past to talk to him oftenly considering that
appellant is their neighbor and barriomate for more than 20 years. (TSN, p. 7, Erlinda
S.; TSN, p. 8, Hizon S.).
Appellant was also seen and identified by prosecution witnesses as he was not wearing
any mask and neither was his face covered during the time he was calling from outside
the house. (TSN, p. 8, Erlinda S.; TSN, p. 13-16, Hizon S.).
Appellant was recognized by the prosecution witnesses because of the fluorescent
lamp in front of the house energized by a 12-volt battery then illuminating their house.
Besides, the night then was a moonlit night. (TSN, p. 8, Erlinda S.; TSN, p. 13, Hizon
S.).
Worthy to note is the testimony of Erlinda that when she recognized the identity of the
persons calling from the outside, she even told her husband to open the door. This is
but natural and in accord with common observation and human experience.
Otherwise, if the persons calling were masked as claimed by the defense, the natural
and logical reaction would be to suspect that they were bad elements and there would
be reason not to open the door. . . . 41
The pretension that appellant was allegedly at his house at the time of the incident
cannot stand against the clear and positive identification by the prosecution witnesses.
Also, the Solicitor General correctly concluded that considering the proximity in the
distance between the two houses, it was not physically impossible for appellant to be at
the locus criminis and then return to his house shortly afterwards.
Finally, conspiracy has been sufficiently established in this case. The concerted acts of
the accused began with the deceased Juanito being called by Pugal and Adduca who
purposely made themselves identifiable to facilitate their entry into the house. Once the
door was opened, three of the accused who were already wearing masks entered the
house while Pugal pulled Jacinto outside. Then one of the three who entered the house
stood guard at the door while the two others ransacked the place. Thereafter, upon
hearing the clapping of hands from the outside, the three malefactors immediately left.
The deceased was tied to the coconut tree and then shot to death. By these concerted
actions, it is beyond cavil that the accused acted in unison and cooperated with each
other towards the accomplishment of a common criminal design, which was to rob the
54
Salamancas and thereafter kill Jacinto. The trial court definitely did not err in finding
the existence of a conspiracy.
Where conspiracy is shown to exist, the act of one is the act of all. 42 While it has not
been established that it was appellant who actually shot the victim, conspiracy having
been found to exist, he is equally guilty of the crime of robbery with homicide. The
rule is whenever homicide has been committed as a consequence or on the occasion of
the robbery, all those who took part as principals in the robbery will also be held guilty
as principals in the robbery will also be held guilty as principals of the special complex
crime of robbery with homicide although they did not actually take part in the
homicide, unless it clearly appears that they endeavored to prevent the
homicide. 43 There is nothing in the records to show that the exception applied in this
case.
We, however, reject that portion of the decision of the trial court finding that the
liability of the accused for the crime of robbery with homicide was attended by, and
ostensibly should be modified by the circumstances of, their use of unlicensed
firearms. No evidence was presented to show, and even the trial court made no finding,
that the firearms used by herein accused were unlicensed. In addition, the indemnity
for which the accused is liable for the death of Jacinto Salamanca should be increased
to P50,000.00 in accordance with the policy adopted by the Court en banc on August
30, 1990. 44
WHEREFORE, subject to the above-stated modifications, the judgment of the court a
quo is hereby AFFIRMED in all other respects.
SO ORDERED.
Note.––The degree of actual participation in the commission of the crime is immaterial
in conspiracy (People vs. Cantuba, 183 SCRA 289) People vs. Pugal, 215 SCRA 247,
G.R. No. 90637 October 29, 1992
G.R. No. 178158. December 4, 2009.
STRATEGIC ALLIANCE DEVELOPMENT CORPORATION, petitioner, vs.
RADSTOCK SECURITIES LIMITED and PHILIPPINE NATIONAL
CONSTRUCTION CORPORATION, respondents. ASIAVEST MERCHANT
BANKERS BERHAD, intervenor.
G.R. No. 180428. December 4, 2009.
LUIS SISON, petitioner, vs. PHILIPPINE NATIONAL CONSTRUCTION
CORPORATION and RADSTOCK SECURITIES LIMITED, respondents.
Actions; Pleadings and Practice; Intervention; While the motion to intervene should be
filed before rendition of judgment by the trial court, the rule is not absolute—
interventions have been allowed even beyond the prescribed period in the Rule in the
higher interest of justice.—The Court of Appeals denied STRADEC’s motion for
intervention on the ground that the motion was filed only after the Court of Appeals
and the trial court had promulgated their respective decisions. Section 2, Rule 19 of the
1997 Rules of Civil Procedure provides: SECTION 2. Time to intervene.—The motion
to intervene may be filed at any time before rendition of judgment by the trial court. A
copy of the pleading-in-intervention shall be attached to the motion and served on the
original parties. The rule is not absolute. The rule on intervention, like all other rules of
procedure, is intended to make the powers of the Court completely available for
justice. It is aimed to facilitate a comprehensive adjudication of rival claims, overriding
technicalities on the timeliness of the filing of the claims. This Court has ruled:
[A]llowance or disallowance of a motion for intervention rests on the sound discretion
of the court after consideration of the appropriate circumstances. Rule 19 of the Rules
of Court is a rule of procedure whose object is to make the powers of the court fully
and completely available for justice. Its purpose is not to hinder or delay but to
facilitate and promote the administration of justice. Thus, interventions have been
allowed even beyond the prescribed period in the Rule in the higher interest of justice.
Interventions have been granted to afford indispensable parties, who have not been
impleaded, the right to be heard even after a decision has been rendered by the trial
court, when the petition for review of the judgment was already submitted for decision
before the Supreme Court, and even where the assailed order has already become final
and executory. In Lim v. Pacquing (310 Phil. 722 (1995)], the motion for intervention
filed by the Republic of the Philippines was allowed by this Court to avoid grave
injustice and injury and to settle once and for all the substantive issues raised by the
parties.
Same; Same; Same; A judgment creditor has a direct and material interest in the
approval or disapproval of a compromise agreement involving its judgment debtor—its
interest is actual and material, direct and immediate characterized by either gain or loss
from the judgment that the Court may render.—STRADEC’s interest is dependent on
the outcome of Civil Case No. 05-882. Unless STRADEC can show that RTC Branch
146 had already decided in its favor, its legal interest is simply contingent and
expectant. However, Asiavest has a direct and material interest in the approval or
disapproval of the Compromise Agreement. Asiavest is a judgment creditor of PNCC
in G.R. No. 110263 and a court has already issued a writ of execution in its favor.
Asiavest’s interest is actual and material, direct and immediate characterized by either
gain or loss from the judgment that this Court may render. Considering that the
Compromise Agreement involves the disposition of all or substantially all of the assets
55
of PNCC, Asiavest, as PNCC’s judgment creditor, will be greatly prejudiced if the
Compromise Agreement is eventually upheld.
Same; Same; Same; Procedural Rules and Technicalities; The Supreme Court should
exercise its prerogative to set aside technicalities in the Rules, because after all, the
power of the Court to suspend its own rules whenever the interest of justice requires is
well recognized.—In the interest of substantial justice and for compelling reasons,
such as the nature and importance of the issues raised in this case, this Court must take
cognizance of Sison’s action. This Court should exercise its prerogative to set aside
technicalities in the Rules, because after all, the power of this Court to suspend its own
rules whenever the interest of justice requires is well recognized. In Solicitor General
v. The Metropolitan Manila Authority, 204 SCRA 837 (1991) this Court held:
Unquestionably, the Court has the power to suspend procedural rules in the exercise of
its inherent power, as expressly recognized in the Constitution, to promulgate rules
concerning ‘pleading, practice and procedure in all courts.’ In proper cases, procedural
rules may be relaxed or suspended in the interest of substantial justice, which
otherwise may be miscarried because of a rigid and formalistic adherence to such rules.
xx
Prescription; Settled is the rule that actions prescribe by the mere lapse of time fixed
by law.—Settled is the rule that actions prescribe by the mere lapse of time fixed by
law. Under Article 1144 of the Civil Code, an action upon a written contract, such as a
loan contract, must be brought within ten years from the time the right of action
accrues. The prescription of such an action is interrupted when the action is filed
before the court, when there is a written extrajudicial demand by the creditor, or when
there is any written acknowledgment of the debt by the debtor.
Same; Same; Same; The provision of the Revised Administrative Code on the power to
settle claims or liabilities was precisely enacted to prevent government agencies from
admitting liabilities against the government, then compromising such “settled”
liabilities—the present case is exactly what the law seeks to prevent, a compromise
agreement on a creditor’s claim settled through admission by a government agency
without the approval of Congress for amounts exceeding 100,000.00.—The provision
of the Revised Administrative Code on the power to settle claims or liabilities was
precisely enacted to prevent government agencies from admitting liabilities against the
government, then compromising such “settled” liabilities. The present case is exactly
what the law seeks to prevent, a compromise agreement on a creditor’s claim settled
through admission by a government agency without the approval of Congress for
amounts exceeding P100,000.00. What makes the application of the law even more
necessary is that the PNCC Board’s twin moves are manifestly and grossly
disadvantageous to the Government. First, the PNCC admitted solidary liability for a
staggering P10.743 billion private debt incurred by a private corporation which PNCC
does not even control. Second, the PNCC Board agreed to pay Radstock P6.185 billion
as a compromise settlement ahead of all other creditors, including the Government
which is the biggest creditor.
Same; Same; Same; Words and Phrases; The phrase “government-owned or controlled
corporations” refers to both those created by special charter as well as those
incorporated under the Corporate Code.
Same; Same; Same; Same; Same; Since Radstock is disqualified to own lands in the
Philippines, it is also disqualified to own the rights to ownership of lands in the
Philippines’
Sales; Dacion en Pago; A dacion en pago is in essence a form of sale, which basically
involves a disposition of a property. Dacion en pago, according to Manresa, is the
transmission of the ownership of a thing by the debtor to the creditor as an accepted
equivalent of the performance of obligation. dacion en pago is an objective novation of
the obligation where the thing offered as an accepted equivalent of the performance of
an obligation is considered as the object of the contract of sale, while the debt is
considered as the purchase price.
Same; There is a presumption that there is fraud of creditors when property is alienated
by the debtor after judgment has been rendered against him.—The law, specifically
Article 1387 of the Civil Code, presumes that there is fraud of creditors when property
is alienated by the debtor after judgment has been rendered against him, thus:
Alienations by onerous title are also presumed fraudulent when made by persons
against whom some judgment has been rendered in any instance or some writ of
attachment has been issued. The decision or attachment need not refer to the property
alienated, and need not have been obtained by the party seeking rescission. As stated
earlier, Asiavest is a judgment creditor of PNCC in G.R. No. 110263 and a court has
already issued a writ of execution in its favor. Thus, when PNCC entered into the
Compromise Agreement conveying several prime lots in favor of Radstock, by way of
dacion en pago, there is a legal presumption that such conveyance is fraudulent under
Article 1387 of the Civil Code. This presumption is strengthened by the fact that the
conveyance has virtually left PNCC’s other creditors, including the biggest creditor—
the National Government—with no other asset to garnish or levy.
BERSAMIN, J., Dissent:
Actions; Intervention; The purpose of intervention—never an independent action, but
ancillary and supplemental to the existing litigation—is not to obstruct or to
unnecessarily delay the placid operation of the machinery of trial, but merely to afford
one not an original party, yet having a certain right or interest in the pending case, the
opportunity to appear and be joined so he can assert or protect such right or interest.—
The purpose of intervention—never an independent action, but ancillary and
supplemental to the existing litigation—is not to obstruct or to unnecessarily delay the
56
placid operation of the machinery of trial, but merely to afford one not an original
party, yet having a certain right or interest in the pending case, the opportunity to
appear and be joined so he can assert or protect such right or interest. Accordingly, as a
general guide for determining whether a party may be allowed to intervene or not, the
trial court, in the exercise of its sound discretion, shall consider whether or not the
intervention will unduly delay or prejudice the adjudication of the rights of the original
parties, and whether or not the intervenor’s rights may be fully protected in a separate
proceeding.
Same; Same; The alleged possibility that STRADEC might be left with worthless
shares was no reason to allow its intervention in order only to assail the compromise
agreement, for such intervention would not enable Philippine National Construction
Corporation (PNCC) to avoid its liability to Radstock, or to save PNCC from being
liable with its own assets for its obligations to Radstock, should the courts ultimately
find that the obligations were justly due and demandable.—STRADEC’s
apprehensions would not be assuaged through its intervention in the action between
Radstock and PNCC or through the nullification of the compromise agreement.
STRADEC was a stranger in relation to the transaction by which PNCC had incurred
the obligations subject of the compromise agreement. Indeed, it would be irregular to
subordinate to STRADEC’s unsettled claim the right of Radstock to collect as PNCC’s
creditor. On the other hand, STRADEC could still hold PNCC’s remaining assets
liable should it prevail in Civil Case No. 05-882. Based on COA’s earlier cited
compliance, PNCC had remaining assets by which it could start anew and pursue its
plans to revitalize its operation.
Judgments; Annulment of Judgments; Rule 47 of the 1997 Rules of Civil Procedure
applies only to petitions for the nullification of judgments rendered by regional trial
courts filed with the Court of Appeals—it does not pertain to the nullification of
decisions of the Court of Appeals.—The jurisdiction to annul a judgment rendered by
the Regional Trial Court is expressly granted to the CA by Section 9 (2) of Batas
Pambansa Blg. 129, otherwise known as the Judiciary Reorganization Act. The
procedure for the purpose is governed by Rule 47, 1997 Rules of Civil Procedure,
whose Section 1 provides: Section 1. Coverage.—This Rule shall govern the
annulment by the Court of Appeals of judgments or final orders and resolutions in civil
actions of Regional Trial Courts for which the ordinary remedies of new trial, appeal,
petition for relief or other appropriate remedies are no longer available through no fault
of the petitioner. Explaining the coverage of the procedure under Rule 47 in Grande v.
University of the Philippines, 502 SCRA 67 (2006), the Court definitely ruled out the
application of Rule 47 to the nullification of a decision of the CA, viz.: The annulment
of judgments, as a recourse, is equitable in character, allowed only in exceptional
cases, as where there is no available or other adequate remedy. It is generally governed
by Rule 47 of the 1997 Rules of Civil Procedure. Section 1 thereof expressly states that
the Rule “shall govern the annulment by the Court of Appeals of judgments of final
orders and resolutions in civil action of Regional Trial Courts for which the ordinary
remedies of new trial, appeal, petition for relief or other appropriate remedies are no
longer available through no fault of the petitioner.” Clearly, Rule 47 applies only to
petitions for the nullification of judgments rendered by regional trial courts filed with
the Court of Appeals. It does not pertain to the nullification of decisions of the Court of
Appeals.
Actions; Pleadings and Practice; Admissions; The rule on admissions does not apply
to a wrong interpretation and mistaken application of the laws, and the Court is not to
be bound by a mistaken interpretation of the law made by a counsel, even if said
interpretation is adverse to the client.—The majority pointedly assert that Radstock’s
counsel already admitted during the oral argument that all of PNCC’s assets and
properties had reverted to the National Government. The assertion of the majority is
too sweeping. It ignores that the so-called admission of Radstock’s counsel was not,
properly speaking, a judicial admission that bound Radstock on the matter of reversion.
To begin with, the statements in question made by Radstock’s counsel did not relate to
facts, but to conclusions of law. Indeed, a judicial admission is an admission made in
the course of the proceeding in the same case, verbal or written, by a party accepting
for the purposes of the suit the truth of some alleged fact, which said party cannot
thereafter disprove. Clearly, the rule on admissions does not apply to a wrong
interpretation and mistaken application of the laws, and the Court is not to be bound by
a mistaken interpretation of the law made by a counsel, even if said interpretation is
adverse to the client.
Actions; Pleadings and Practice; It hardly requires clarification that an opinion on a
matter of law given in the course of the proceedings is not binding on the party on
whose behalf it is made, because the question of law is best left to the determination of
the court.—In this connection, the claim of the majority that Radstock’s counsel
admitted during the oral arguments that an appropriation law was needed to authorize
the payment by PNCC out of the toll fees is unwarranted. The supposed admission was
apparently counsel’s response to the query of whether the collection of toll fees went to
the general fund of the National Government. As such, the response was an expression
of counsel’s interpretation of the law, which, albeit sounding like an admission, has no
legal significance for purposes of this resolution. It hardly requires clarification that an
opinion on a matter of law given in the course of the proceedings is not binding on the
party on whose behalf it is made, because the question of law is best left to the
determination of the court.
Same; Evidence; Judicial Notice; Congressional Deliberations; Words and Phrases;
The speeches of legislators delivered on the floor and the testimonies of resource
persons given in Congressional committee hearings, like those quoted in the majority
opinion, have no probative value in judicial adjudication, for they are not recognized as
evidence under the Rules of Court; The term official acts, in its general sense, may
57
encompass all activities of the Congress, like the laws enacted and resolutions adopted,
but the statements of the legislators and testimonies cannot be regarded, by any stretch
of legal understanding, as the “official act of the legislative department”; Although the
Court can take cognizance of the proceedings of the Senate, as acts of a department of
the National Government, the testimonies or statements of the persons during the
hearings or sessions may not be used to prove disputed facts in the courts of law.—The
majority rely heavily on the transcripts of the Senate Committee hearings to buttress
the imputation of bad faith behind the passage of the board resolution that recognized
PNCC’s debts to Marubeni. They copiously quote the privilege speech of Senator
Franklin Drilon delivered during the plenary session of December 21, 2006; and the
transcripts of the Senate Committee hearings held on December 14, 2006. To me, the
reliance on the privilege speech and the transcripts of the Senate Committee hearings is
unwarranted and misplaced. The speeches of legislators delivered on the floor and the
testimonies of resource persons given in Congressional committee hearings, like those
quoted in the majority opinion, have no probative value in judicial adjudication, for
they are not recognized as evidence under the Rules of Court. Even the rule on judicial
notice embodied in Section 1, Rule 129, of the Rules of Court does not accord
probative value to such speeches and testimonies, because the rule extends only to the
official acts of the Legislative Department. The term official acts, in its general sense,
may encompass all activities of the Congress, like the laws enacted and resolutions
adopted, but the statements of the legislators and testimonies cannot be regarded, by
any stretch of legal understanding, as the “official act of the legislative department.” At
best, the courts can only take judicial notice of the fact that such statements or
speeches were made by such persons, or that such hearings were conducted. Although
this Court can take cognizance of the proceedings of the Senate, as acts of a
department of the National Government, the testimonies or statements of the persons
during the hearings or sessions may not be used to prove disputed facts in the courts of
law. They cannot substitute actual testimony as basis for making findings of fact
necessary for the determination of a controversy by the courts. In other words, they are
incompetent for purposes of judicial proceedings.
Same; Intervention; The interest that entitles a person to intervene in a suit already
commenced between other persons must be in the matter in litigation and of such
character that the intervenor will either gain or lose by direct legal operation and effect
of the judgment.—To start with, Asiavest has no direct and material interest in the
approval (or disapproval) of the compromise agreement between PNCC and Radstock.
Secondly, Asiavest’s request to intervene was made too late in the proceedings. Under
Section 2, Rule 19, 1997 Rules of Civil Procedure, an intervention, to be permitted,
must be sought prior to the rendition of the judgment by the trial court. Thirdly, the
avowed interest of Asiavest in PNCC’s assets emanated from its being a creditor of
PNCC by final judgment, and was not related to the personal obligations of PNCC in
favor of Marubeni (that is, the guarantees for the loans) that were the subject of the
compromise agreement. Such interest did not entitle Asiavest to attack the compromise
agreement between PNCC and Radstock. The interest that entitles a person to
intervene in a suit already commenced between other persons must be in the matter in
litigation and of such character that the intervenor will either gain or lose by direct
legal operation and effect of the judgment. The conditions for a proper intervention in
relation to Asiavest simply did not exist. Moreover, sustaining Asiavest’s posture may
mean allowing other creditors to intervene in an action involving their debtor brought
by another creditor against such debtor upon the broad pretext that they were thereby
prejudiced. The absurdity of Asiavest’s posture, being plain, can never be permitted
under the rules on intervention.
Evidence; Hearsay Evidence Rule; Mere newspaper reports are incompetent and
inadmissible hearsay.—Lastly, Asiavest’s argument that the compromise agreement
might be in fraud of it as a judgment creditor of PNCC, in support of which newspaper
reports are cited, is unpersuasive. The allegation of fraud remains unsupported by
admissible and credible evidence presented by Asiavest, considering that mere
newspaper reports are incompetent and inadmissible hearsay. Strategic Alliance
Development Corporation vs. Radstock Securities Limited, 607 SCRA 413, G.R. No.
178158 December 4, 2009
Prologue
This case is an anatomy of a ₱6.185 billion 1 pillage of the public coffers that ranks
among one of the most brazen and hideous in the history of this country. This case
answers the questions why our Government perennially runs out of funds to provide
basic services to our people, why the great masses of the Filipino people wallow in
poverty, and why a very select few amass unimaginable wealth at the expense of the
Filipino people.
On 1 May 2007, the 30-year old franchise of Philippine National Construction
Corporation (PNCC) under Presidential Decree No. 1113 (PD 1113), as amended by
Presidential Decree No. 1894 (PD 1894), expired. During the 13th Congress, PNCC
sought to extend its franchise. PNCC won approval from the House of Representatives,
which passed House Bill No. 5749 2 renewing PNCC’s franchise for another 25 years.
However, PNCC failed to secure approval from the Senate, dooming the extension of
PNCC’s franchise. Led by Senator Franklin M. Drilon, the Senate opposed PNCC’s
plea for extension of its franchise. 3 Senator Drilon’s privilege speech 4 explains why the
Senate chose not to renew PNCC’s franchise:
I repeat, Mr. President. PNCC has agreed in a compromise agreement dated 17 August
2006 to transfer to Radstock Securities Limited ₱17,676,063,922, no small money, Mr.
President, my dear colleagues, ₱17.6 billion.
58
What does it consist of? It consists of the following: 19 pieces of real estate properties
with an appraised value of ₱5,993,689,000. Do we know what is the bulk of this? An
almost 13-hectare property right here in the Financial Center. As we leave the Senate,
as we go out of this Hall, as we drive thru past the GSIS, we will see on the right a
vacant lot, that is PNCC property. As we turn right on Diosdado Macapagal, we see on
our right new buildings, these are all PNCC properties. That is 12.9 hectares of
valuable asset right in this Financial Center that is worth ₱5,993,689.000.
What else, Mr. President? The 20% of the outstanding capital stock of PNCC with a
par value of ₱2,300,000,000-- I repeat, 20% of the outstanding capital stock of PNCC
worth ₱2,300 billion-- was assigned to Radstock.
In addition, Mr. President and my dear colleagues, please hold on to your seats because
part of the agreement is 50% of PNCC’s 6% share in the gross toll revenue of the
Manila North Tollways Corporation for 27 years, from 2008 to 2035, is being assigned
to Radstock. How much is this worth? It is worth ₱9,382,374,922. I repeat,
₱9,382,374,922.
xxxx
Mr. President, ₱17,676,000,000, however, was made to appear in the agreement to be
only worth ₱6,196,156,488. How was this achieved? How was an aggregate amount of
₱17,676,000,000 made to appear to be only ₱6,196,156,488? First, the 19 pieces of
real estate worth ₱5,993,689,000 were only assigned a value of ₱4,195,000,000 or only
70% of their appraised value.
Second, the PNCC shares of stock with a par value of ₱2.3 billion were marked to
market and therefore were valued only at ₱713 million.
Third, the share of the toll revenue assigned was given a net present value of only
₱1,287,000,000 because of a 15% discounted rate that was applied.
In other words, Mr. President, the toll collection of ₱9,382,374,922 for 27 years was
given a net present value of only ₱1,287,000,000 so that it is made to appear that the
compromise agreement is only worth ₱6,196,000,000.
Mr. President, my dear colleagues, this agreement will substantially wipe out all the
assets of PNCC. It will be left with nothing else except, probably, the collection for the
next 25 years or so from the North Luzon Expressway. This agreement brought PNCC
to the cleaners and literally cleaned the PNCC of all its assets. They brought PNCC to
the cleaners and cleaned it to the tune of ₱17,676,000,000.
xxxx
Mr. President, are we not entitled, as members of the Committee, to know who is
Radstock Securities Limited?
Radstock Securities Limited was allegedly incorporated under the laws of the British
Virgin Islands. It has no known board of directors, except for its recently appointed
attorney-in-fact, Mr. Carlos Dominguez.
Mr. President, are the members of the Committee not entitled to know why 20 years
after the account to Marubeni Corporation, which gave rise to the compromise
agreement 20 years after the obligation was allegedly incurred, PNCC suddenly
recognized this obligation in its books when in fact this obligation was not found in its
books for 20 years?
In other words, Mr. President, for 20 years, the financial statements of PNCC did not
show any obligation to Marubeni, much less, to Radstock. Why suddenly on October
20, 2000, ₱10 billion in obligation was recognized? Why was it recognized?
During the hearing on December 18, Mr. President, we asked this question to the Asset
Privatization Trust (APT) trustee, Atty. Raymundo Francisco, and he was asked:
"What is the basis of your recommendation to recognize this?" He said: "I based my
recommendation on a legal opinion of Feria and Feria." I asked him: "Who knew of
this opinion?" He said: "Only me and the chairman of PNCC, Atty. Renato
Valdecantos." I asked him: "Did you share this opinion with the members of the board
who recognized the obligation of ₱10 billion?" He said: "No." "Can you produce this
opinion now?" He said: "I have no copy."
Mysteriously, Mr. President, an obligation of ₱10 billion based on a legal opinion
which, even Mr. Arthur Aguilar, the chairman of PNCC, is not aware of, none of the
members of the PNCC board on October 20, 2000 who recognized this obligation had
seen this opinion. It is mysterious.
Mr. President, are the members of our Committee not entitled to know why Radstock
Securities Limited is given preference over all other creditors notwithstanding the fact
that this is an unsecured obligation? There is no mortgage to secure this obligation.
More importantly, Mr. President, equally recognized is the obligation of PNCC to the
Philippine government to the tune of ₱36 billion. PNCC owes the Philippine
government ₱36 billion recognized in its books, apart from ₱3 billion in taxes. Why in
the face of all of these is Radstock given preference? Why is it that Radstock is given
preference to claim ₱17.676 billion of the assets of PNCC and give it superior status
over the claim of the Philippine government, of the Filipino people to the extent of ₱36
billion and taxes in the amount of P3 billion? Why, Mr. President? Why is Radstock
given preference not only over the Philippine government claims of ₱39 billion but
also over other creditors including a certain best merchant banker in Asia, which has
already a final and executory judgment against PNCC for about ₱300 million? Why,
Mr. President? Are we not entitled to know why the compromise agreement assigned
₱17.676 billion to Radstock? Why was it executed? 5 (Emphasis supplied)
59
Aside from Senator Drilon, Senator Sergio S. Osmeña III also saw irregularities in the
transactions involving the Marubeni loans, thus:
SEN. OSMEÑA. Ah okay. Good.
Now, I'd like to point out to the Committee that – it seems that this was a politically
driven deal like IMPSA. Because the acceptance of the 10 billion or 13 billion debt
came in October 2000 and the Radstock assignment was January 10, 2001. Now, why
would Marubeni sell for $2 million three months after there was a recognition that it
was owed ₱10 billion. Can you explain that, Mr. Dominguez?
MR. DOMINGUEZ. Your Honor, I am not aware of the decision making process of
Marubeni. But my understanding was, the Japanese culture is not a litigious one and
they didn't want to get into a, you know, a court situation here in the Philippines
having a lot of other interest, et cetera.
SEN. OSMEÑA. Well, but that is beside the point, Mr. Dominguez. All I am asking is
does it stand to reason that after you get an acceptance by a debtor that he owes you 10
billion, you sell your note for 100 million.
Now, if that had happened a year before, maybe I would have understood why he sold
for such a low amount. But right after, it seems that this was part of an orchestrated
deal wherein with certain powerful interest would be able to say, "Yes, we will push
through. We'll fix the courts. We'll fix the board. We'll fix the APT. And we will be
able to do it, just give us 55 percent of whatever is recovered," am I correct?
MR. DOMINGUEZ. As I said, Your Honor, I am not familiar with the decision
making process of Marubeni. But my understanding was, as I said, they didn't want to
get into a …
SEN. OSMEÑA. All right.
MR. DOMINGUEZ. ...litigious situation.6
xxxx
SEN. OSMEÑA. All of these financial things can be arranged. They can hire a local
bank, Filipino, to be trustee for the real estate. So ...
SEN. DRILON. Well, then, that’s a dummy relationship.
SEN. OSMEÑA. In any case, to me the main point here is that a third party, Radstock,
whoever owns it, bought Marubeni’s right for $2 million or ₱100 million. Then, they
are able to go through all these legal machinations and get awarded with the consent of
PNCC of 6 billion. That’s a 100 million to 6 billion. Now, Mr. Aguilar, you have been
in the business for such a long time. I mean, this hedge funds whether it’s Radstock or
New Bridge or Texas Pacific Group or Carlyle or Avenue Capital, they look at their
returns. So if Avenue Capital buys something for $2 million and you give him $4
million in one year, it’s a 100 percent return. They’ll walk away and dance to their
stockholders. So here in this particular case, if you know that Radstock only bought it
for $2 million, I would have gotten board approval and say, "Okay, let’s settle this for
$4 million." And Radstock would have jumped up and down. So what looks to me is
that this was already a scheme. Marubeni wrote it off already. Marubeni wrote
everything off. They just got a $2 million and they probably have no more residual
rights or maybe there’s a clause there, a secret clause, that says, "I want 20 percent of
whatever you’re able to eventually collect." So $2 million. But whatever it is,
Marubeni practically wrote it off. Radstock’s liability now or exposure is only $2
million plus all the lawyer fees, under-the-table, etcetera. All right. Okay. So it’s pretty
obvious to me that if anybody were using his brain, I would have gone up to Radstock
and say, "Here’s $4 million. Here’s P200 million. Okay." They would have walked
away. But evidently, the "ninongs" of Radstock – See, I don’t care who owns
Radstock. I want to know who is the ninong here who stands to make a lot of money
by being able to get to courts, the government agencies, OGCC, or whoever else has
been involved in this, to agree to 6 billion or whatever it was. That’s a lot of money.
And believe me, Radstock will probably get one or two billion and four billion will go
into somebody else’s pocket. Or Radstock will turn around, sell that claim for ₱4
billion and let the new guy just collect the payments over the years.
x x x x7
SEN. OSMEÑA. x x x I just wanted to know is CDCP Mining a 100 percent
subsidiary of PNCC?
MR. AGUILAR. Hindi ho. Ah, no.
SEN. OSMEÑA. If they’re not a 100 percent, why would they sign jointly and
severally? I just want to plug the loopholes.
MR. AGUILAR. I think it was – if I may just speculate. It was just common ownership
at that time.
SEN. OSMEÑA. Al right. Now – Also, the ...
MR. AGUILAR. Ah, 13 percent daw, Your Honor.
SEN. OSMEÑA. Huh?
MR. AGUILAR. Thirteen percent ho.
SEN. OSMEÑA. What’s 13 percent?
MR. AGUILAR. We owned ...
xxxx
60
SEN. OSMEÑA. x x x CDCP Mining, how many percent of the equity of CDCP
Mining was owned by PNCC, formerly CDCP?
MS. PASETES. Thirteen percent.
SEN. OSMEÑA. Thirteen. And as a 13 percent owner, they agreed to sign jointly and
severally?
MS. PASETES. Yes.
SEN. OSMEÑA. One-three? So poor PNCC and CDCP got taken to the cleaners here.
They sign for a 100 percent and they only own 13 percent.
x x x x8 (Emphasis supplied)
I.
The Case
Before this Court are the consolidated petitions for review 9 filed by Strategic Alliance
Development Corporation (STRADEC) and Luis Sison (Sison), with a motion for
intervention filed by Asiavest Merchant Bankers Berhad (Asiavest), challenging the
validity of the Compromise Agreement between PNCC and Radstock. The Court of
Appeals approved the Compromise Agreement in its Decision of 25 January 2007 10 in
CA-G.R. CV No. 87971.
II.
The Antecedents
PNCC was incorporated in 1966 for a term of fifty years under the Corporation Code
with the name Construction Development Corporation of the Philippines (CDCP).11 PD
1113, issued on 31 March 1977, granted CDCP a 30-year franchise to construct,
operate and maintain toll facilities in the North and South Luzon Tollways. PD 1894,
issued on 22 December 1983, amended PD 1113 to include in CDCP’s franchise the
Metro Manila Expressway, which would "serve as an additional artery in the
transportation of trade and commerce in the Metro Manila area."
Sometime between 1978 and 1981, Basay Mining Corporation (Basay Mining), an
affiliate of CDCP, obtained loans from Marubeni Corporation of Japan (Marubeni)
amounting to 5,460,000,000 yen and US$5 million. A CDCP official issued letters of
guarantee for the loans, committing CDCP to pay solidarily for the full amount of the
5,460,000,000 yen loan and to the extent of ₱20 million for the US$5 million loan.
However, there was no CDCP Board Resolution authorizing the issuance of the letters
of guarantee. Later, Basay Mining changed its name to CDCP Mining Corporation
(CDCP Mining). CDCP Mining secured the Marubeni loans when CDCP and CDCP
Mining were still privately owned and managed.
Subsequently in 1983, CDCP changed its corporate name to PNCC to reflect the extent
of the Government's equity investment in the company, which arose when government
financial institutions converted their loans to PNCC into equity following PNCC’s
inability to pay the loans.12 Various government financial institutions held a total of
seventy-seven point forty-eight percent (77.48%) of PNCC’s voting equity, most of
which were later transferred to the Asset Privatization Trust (APT) under
Administrative Orders No. 14 and 64, series of 1987 and 1988, respectively. 13 Also, the
Presidential Commission on Good Government holds some 13.82% of PNCC’s voting
equity under a writ of sequestration and through the voluntary surrender of certain
PNCC shares. In fine, the Government owns 90.3% of the equity of PNCC and only
9.70% of PNCC’s voting equity is under private ownership.14
Meanwhile, the Marubeni loans to CDCP Mining remained unpaid. On 20 October
2000, during the short-lived Estrada Administration, the PNCC Board of
Directors15 (PNCC Board) passed Board Resolution No. BD-092-2000 admitting
PNCC’s liability to Marubeni for ₱10,743,103,388 as of 30 September 1999. PNCC
Board Resolution No. BD-092-2000 reads as follows:
RESOLUTION NO. BD-092-2000
RESOLVED, That the Board recognizes, acknowledges and confirms PNCC’s
obligations as of September 30, 1999 with the following entities, exclusive of the
interests and other charges that may subsequently accrue and still become due therein,
to wit:
a). the Government of the Republic of the Philippines in the amount of
₱36,023,784,751.00; and
b). Marubeni Corporation in the amount of ₱10,743,103,388.00. (Emphasis supplied)
This was the first PNCC Board Resolution admitting PNCC’s liability for the
Marubeni loans. Previously, for two decades the PNCC Board consistently refused to
admit any liability for the Marubeni loans.
Less than two months later, or on 22 November 2000, the PNCC Board passed Board
Resolution No. BD-099-2000 amending Board Resolution No. BD-092-2000. PNCC
Board Resolution No. BD-099-2000 reads as follows:
RESOLUTION NO. BD-099-2000
RESOLVED, That the Board hereby amends its Resolution No. BD-092-2000 dated
October 20, 2000 so as to read as follows:
RESOLVED, That the Board recognizes, acknowledges and confirms its obligations as
of September 30, 1999 with the following entities, exclusive of the interests and other
charges that may subsequently accrue and still due thereon, subject to the final
61
determination by the Commission on Audit (COA) of the amount of obligation
involved, and subject further to the declaration of the legality of said obligations by the
Office of the Government Corporate Counsel (OGCC), to wit:
a). the Government of the Republic of the Philippines in the amount of
₱36,023,784,751.00; and
b). Marubeni Corporation in the amount of ₱10,743,103,388.00. (Emphasis supplied)
In January 2001, barely three months after the PNCC Board first admitted liability for
the Marubeni loans, Marubeni assigned its entire credit to Radstock for US$2 million
or less than ₱100 million. In short, Radstock paid Marubeni less than 10% of the
₱10.743 billion admitted amount. Radstock immediately sent a notice and demand
letter to PNCC.
On 15 January 2001, Radstock filed an action for collection and damages against
PNCC before the Regional Trial Court of Mandaluyong City, Branch 213 (trial court).
In its order of 23 January 2001, the trial court issued a writ of preliminary attachment
against PNCC. The trial court ordered PNCC’s bank accounts garnished and several of
its real properties attached. On 14 February 2001, PNCC moved to set aside the 23
January 2001 Order and to discharge the writ of attachment. PNCC also filed a motion
to dismiss the case. The trial court denied both motions. PNCC filed motions for
reconsideration, which the trial court also denied. PNCC filed a petition for certiorari
before the Court of Appeals, docketed as CA-G.R. SP No. 66654, assailing the denial
of the motion to dismiss. On 30 August 2002, the Court of Appeals denied PNCC’s
petition. PNCC filed a motion for reconsideration, which the Court of Appeals also
denied in its 22 January 2003 Resolution. PNCC filed a petition for review before this
Court, docketed as G.R. No. 156887.
Meanwhile, on 19 June 2001, at the start of the Arroyo Administration, the PNCC
Board, under a new President and Chairman, revoked Board Resolution No. BD-099-
2000.
The trial court continued to hear the main case. On 10 December 2002, the trial court
ruled in favor of Radstock, as follows:
WHEREFORE, premises considered, judgment is hereby rendered in favor of the
plaintiff and the defendant is directed to pay the total amount of Thirteen Billion One
Hundred Fifty One Million Nine Hundred Fifty Six thousand Five Hundred Twenty
Eight Pesos (₱13,151,956,528.00) with interest from October 15, 2001 plus Ten
Million Pesos (₱10,000,000.00) as attorney’s fees.
SO ORDERED.16
PNCC appealed the trial court’s decision to the Court of Appeals, docketed as CA-
G.R. CV No. 87971.
On 19 March 2003, this Court issued a temporary restraining order in G.R. No. 156887
forbidding the trial court from implementing the writ of preliminary attachment and
ordering the suspension of the proceedings before the trial court and the Court of
Appeals. In its 3 October 2005 Decision, this Court ruled as follows:
WHEREFORE, the petition is partly GRANTED and insofar as the Motion to Set
Aside the Order and/or Discharge the Writ of Attachment is concerned, the Decision of
the Court of Appeals on August 30, 2002 and its Resolution of January 22, 2003 in
CA-G.R. SP No. 66654 are REVERSED and SET ASIDE. The attachments over the
properties by the writ of preliminary attachment are hereby ordered LIFTED effective
upon the finality of this Decision. The Decision and Resolution of the Court of
Appeals are AFFIRMED in all other respects. The Temporary Restraining Order is
DISSOLVED immediately and the Court of Appeals is directed to PROCEED
forthwith with the appeal filed by PNCC.
No costs.
SO ORDERED.17
On 17 August 2006, PNCC and Radstock entered into the Compromise Agreement
where they agreed to reduce PNCC’s liability to Radstock, supposedly from
₱17,040,843,968, to ₱6,185,000,000. PNCC and Radstock submitted the Compromise
Agreement to this Court for approval. In a Resolution dated 4 December 2006 in G.R.
No. 156887, this Court referred the Compromise Agreement to the Commission on
Audit (COA) for comment. The COA recommended approval of the Compromise
Agreement. In a Resolution dated 22 November 2006, this Court noted the
Compromise Agreement and referred it to the Court of Appeals in CA-G.R. CV No.
87971. In its 25 January 2007 Decision, the Court of Appeals approved the
Compromise Agreement.
STRADEC moved for reconsideration of the 25 January 2007 Decision. STRADEC
alleged that it has a claim against PNCC as a bidder of the National Government’s
shares, receivables, securities and interests in PNCC. The matter is subject of a
complaint filed by STRADEC against PNCC and the Privatization and Management
Office (PMO) for the issuance of a Notice of Award of Sale to Dong-A Consortium of
which STRADEC is a partner. The case, docketed as Civil Case No. 05-882, is
pending before the Regional Trial Court of Makati, Branch 146 (RTC Branch 146).
The Court of Appeals treated STRADEC’s motion for reconsideration as a motion for
intervention and denied it in its 31 May 2007 Resolution. STRADEC filed a petition
for review before this Court, docketed as G.R. No. 178158.
Rodolfo Cuenca (Cuenca), a stockholder and former PNCC President and Board
Chairman, filed an intervention before the Court of Appeals. Cuenca alleged that
PNCC had no obligation to pay Radstock. The Court of Appeals also denied Cuenca’s
62
motion for intervention in its Resolution of 31 May 2007. Cuenca did not appeal the
denial of his motion.
On 2 July 2007, this Court issued an order directing PNCC and Radstock, their
officers, agents, representatives, and other persons under their control, to maintain the
status quo ante.
Meanwhile, on 20 February 2007, Sison, also a stockholder and former PNCC
President and Board Chairman, filed a Petition for Annulment of Judgment Approving
Compromise Agreement before the Court of Appeals. The case was docketed as CA-
G.R. SP No. 97982.
Asiavest, a judgment creditor of PNCC, filed an Urgent Motion for Leave to Intervene
and to File the Attached Opposition and Motion-in-Intervention before the Court of
Appeals in CA-G.R. SP No. 97982.
In a Resolution dated 12 June 2007, the Court of Appeals dismissed Sison’s petition on
the ground that it had no jurisdiction to annul a final and executory judgment also
rendered by the Court of Appeals. In the same resolution, the Court of Appeals also
denied Asiavest’s urgent motion.
Asiavest filed its Urgent Motion for Leave to Intervene and to File the Attached
Opposition and Motion-in-Intervention in G.R. No. 178158.18
Sison filed a motion for reconsideration. In its 5 November 2007 Resolution, the Court
of Appeals denied Sison’s motion.
On 26 November 2007, Sison filed a petition for review before this Court, docketed as
G.R. No. 180428.
In a Resolution dated 18 February 2008, this Court consolidated G.R. Nos. 178158 and
180428.
On 13 January 2009, the Court held oral arguments on the following issues:
1. Does the Compromise Agreement violate public policy?
2. Does the subject matter involve an assumption by the government of a private
entity’s obligation in violation of the law and/or the Constitution? Is the PNCC Board
Resolution of 20 October 2000 defective or illegal?
3. Is the Compromise Agreement viable in the light of the non-renewal of PNCC’s
franchise by Congress and its inclusion of all or substantially all of PNCC’s assets?
4. Is the Decision of the Court of Appeals annullable even if final and executory on
grounds of fraud and violation of public policy and the Constitution?
III.
Propriety of Actions
The Court of Appeals denied STRADEC’s motion for intervention on the ground that
the motion was filed only after the Court of Appeals and the trial court had
promulgated their respective decisions.
Section 2, Rule 19 of the 1997 Rules of Civil Procedure provides:
SECTION 2. Time to intervene.– The motion to intervene may be filed at any time
before rendition of judgment by the trial court. A copy of the pleading-in-intervention
shall be attached to the motion and served on the original parties.
The rule is not absolute. The rule on intervention, like all other rules of procedure, is
intended to make the powers of the Court completely available for justice. 19 It is aimed
to facilitate a comprehensive adjudication of rival claims, overriding technicalities on
the timeliness of the filing of the claims.20 This Court has ruled:
[A]llowance or disallowance of a motion for intervention rests on the sound discretion
of the court after consideration of the appropriate circumstances. Rule 19 of the Rules
of Court is a rule of procedure whose object is to make the powers of the court fully
and completely available for justice. Its purpose is not to hinder or delay but to
facilitate and promote the administration of justice. Thus, interventions have been
allowed even beyond the prescribed period in the Rule in the higher interest of justice.
Interventions have been granted to afford indispensable parties, who have not been
impleaded, the right to be heard even after a decision has been rendered by the trial
court, when the petition for review of the judgment was already submitted for decision
before the Supreme Court, and even where the assailed order has already become final
and executory. In Lim v. Pacquing (310 Phil. 722 (1995)], the motion for intervention
filed by the Republic of the Philippines was allowed by this Court to avoid grave
injustice and injury and to settle once and for all the substantive issues raised by the
parties.21
In Collado v. Court of Appeals,22 this Court reiterated that exceptions to Section 2,
Rule 12 could be made in the interest of substantial justice. Citing Mago v. Court of
Appeals,23 the Court stated:
It is quite clear and patent that the motions for intervention filed by the movants at this
stage of the proceedings where trial had already been concluded x x x and on appeal x
x x the same affirmed by the Court of Appeals and the instant petition for certiorari to
review said judgments is already submitted for decision by the Supreme Court, are
obviously and, manifestly late, beyond the period prescribed under x x x Section 2,
Rule 12 of the Rules of Court.
63
But Rule 12 of the Rules of Court, like all other Rules therein promulgated, is simply a
rule of procedure, the whole purpose and object of which is to make the powers of the
Court fully and completely available for justice. The purpose of procedure is not to
thwart justice. Its proper aim is to facilitate the application of justice to the rival claims
of contending parties. It was created not to hinder and delay but to facilitate and
promote the administration of justice. It does not constitute the thing itself which
courts are always striving to secure to litigants. It is designed as the means best
adopted to obtain that thing. In other words, it is a means to an end.
Concededly, STRADEC has no legal interest in the subject matter of the Compromise
Agreement. Section 1, Rule 19 of the 1997 Rules of Civil Procedure states:
SECTION 1. Who may intervene. - A person who has a legal interest in the matter in
litigation, or in the success of either of the parties, or an interest against both, or is so
situated as to be adversely affected by a distribution or other disposition of property in
the custody of the court or of an officer thereof may, with leave of court, be allowed to
intervene in the action. The Court shall consider whether or not the intervention will
unduly delay or prejudice the adjudication of the rights of the original parties, and
whether or not the intervenor’s rights may be fully protected in a separate proceeding.
STRADEC’s interest is dependent on the outcome of Civil Case No. 05-882. Unless
STRADEC can show that RTC Branch 146 had already decided in its favor, its legal
interest is simply contingent and expectant.
However, Asiavest has a direct and material interest in the approval or disapproval of
the Compromise Agreement. Asiavest is a judgment creditor of PNCC in G.R. No.
110263 and a court has already issued a writ of execution in its favor. Asiavest’s
interest is actual and material, direct and immediate characterized by either gain or loss
from the judgment that this Court may render. 24 Considering that the Compromise
Agreement involves the disposition of all or substantially all of the assets of PNCC,
Asiavest, as PNCC’s judgment creditor, will be greatly prejudiced if the Compromise
Agreement is eventually upheld.
Sison has legal standing to challenge the Compromise Agreement. Although there was
no allegation that Sison filed the case as a derivative suit in the name of PNCC, it
could be fairly deduced that Sison was assailing the Compromise Agreement as a
stockholder of PNCC. In such a situation, a stockholder of PNCC can sue on behalf of
PNCC to annul the Compromise Agreement.
A derivative action is a suit by a stockholder to enforce a corporate cause of
action.25 Under the Corporation Code, where a corporation is an injured party, its
power to sue is lodged with its board of directors or trustees. 26 However, an individual
stockholder may file a derivative suit on behalf of the corporation to protect or
vindicate corporate rights whenever the officials of the corporation refuse to sue, or are
the ones to be sued, or hold control of the corporation. 27 In such actions, the
corporation is the real party-in-interest while the suing stockholder, on behalf of the
corporation, is only a nominal party.28
In this case, the PNCC Board cannot conceivably be expected to attack the validity of
the Compromise Agreement since the PNCC Board itself approved the Compromise
Agreement. In fact, the PNCC Board steadfastly defends the Compromise Agreement
for allegedly being advantageous to PNCC.
Besides, the circumstances in this case are peculiar. Sison, as former PNCC President
and Chairman of the PNCC Board, was responsible for the approval of the Board
Resolution issued on 19 June 2001 revoking the previous Board Resolution admitting
PNCC’s liability for the Marubeni loans. 29 Such revocation, however, came after
Radstock had filed an action for collection and damages against PNCC on 15 January
2001. Then, when the trial court rendered its decision on 10 December 2002 in favor of
Radstock, Sison was no longer the PNCC President and Chairman, although he
remains a stockholder of PNCC.
When the case was on appeal before the Court of Appeals, there was no need for Sison
to avail of any remedy, until PNCC and Radstock entered into the Compromise
Agreement, which disposed of all or substantially all of PNCC’s assets. Sison came to
know of the Compromise Agreement only in December 2006. PNCC and Radstock
submitted the Compromise Agreement to the Court of Appeals for approval on 10
January 2007. The Court of Appeals approved the Compromise Agreement on 25
January 2007. To require Sison at this stage to exhaust all the remedies within the
corporation will render such remedies useless as the Compromise Agreement had
already been approved by the Court of Appeals. PNCC’s assets are in danger of being
dissipated in favor of a private foreign corporation. Thus, Sison had no recourse but to
avail of an extraordinary remedy to protect PNCC’s assets.
Besides, in the interest of substantial justice and for compelling reasons, such as the
nature and importance of the issues raised in this case, 30 this Court must take
cognizance of Sison’s action. This Court should exercise its prerogative to set aside
technicalities in the Rules, because after all, the power of this Court to suspend its own
rules whenever the interest of justice requires is well recognized. 31 In Solicitor General
v. The Metropolitan Manila Authority,32 this Court held:
Unquestionably, the Court has the power to suspend procedural rules in the exercise of
its inherent power, as expressly recognized in the Constitution, to promulgate rules
concerning ‘pleading, practice and procedure in all courts.’ In proper cases, procedural
rules may be relaxed or suspended in the interest of substantial justice, which
otherwise may be miscarried because of a rigid and formalistic adherence to such rules.
xxx
64
We have made similar rulings in other cases, thus:
Be it remembered that rules of procedure are but mere tools designed to facilitate the
attainment of justice. Their strict and rigid application, which would result in
technicalities that tend to frustrate rather than promote substantial justice, must always
be avoided. x x x Time and again, this Court has suspended its own rules and excepted
a particular case from their operation whenever the higher interests of justice so
require.
IV.
The PNCC Board Acted in Bad Faith and with Gross Negligence
in Directing the Affairs of PNCC
In this jurisdiction, the members of the board of directors have a three-fold duty: duty
of obedience, duty of diligence, and duty of loyalty. 33 Accordingly, the members of the
board of directors (1) shall direct the affairs of the corporation only in accordance with
the purposes for which it was organized;34 (2) shall not willfully and knowingly vote
for or assent to patently unlawful acts of the corporation or act in bad faith or
with gross negligence in directing the affairs of the corporation;35 and (3) shall not
acquire any personal or pecuniary interest in conflict with their duty as such directors
or trustees.36
In the present case, the PNCC Board blatantly violated its duty of diligence as it
miserably failed to act in good faith in handling the affairs of PNCC.
First. For almost two decades, the PNCC Board had consistently refused to admit
liability for the Marubeni loans because of the absence of a PNCC Board resolution
authorizing the issuance of the letters of guarantee.
There is no dispute that between 1978 and 1980, Marubeni Corporation extended two
loans to Basay Mining (later renamed CDCP Mining): (1) US$5 million to finance the
purchase of copper concentrates by Basay Mining; and (2) Y5.46 billion to finance the
completion of the expansion project of Basay Mining including working capital.
There is also no dispute that it was only on 20 October 2000 when the PNCC Board
approved a resolution expressly admitting PNCC’s liability for the Marubeni loans.
This was the first Board Resolution admitting liability for the Marubeni loans, for
PNCC never admitted liability for these debts in the past. Even Radstock admitted that
PNCC’s 1994 Financial Statements did not reflect the Marubeni loans. 37 Also, former
PNCC Chairman Arthur Aguilar stated during the Senate hearings that "the Marubeni
claim was never in the balance sheet x x x nor was it in a contingent
account."38 Miriam M. Pasetes, SVP Finance of PNCC, and Atty. Herman R.
Cimafranca of the Office of the Government Corporate Counsel, confirmed this fact,
thus:
SEN. DRILON. x x x And so, PNCC itself did not recognize this as an obligation but
the board suddenly recognized it as an obligation. It was on that basis that the case was
filed, is that correct? In fact, the case hinges on – they knew that this claim has
prescribed but because of that board resolution which recognized the obligation they
filed their complaint, is that correct?
MR. CIMAFRANCA. Apparently, it's like that, Senator, because the filing of the case
came after the acknowledgement.
SEN. DRILON. Yes. In fact, the filing of the case came three months after the
acknowledgement.
MR. CIMAFRANCA. Yes. And that made it difficult to handle on our part.
SEN. DRILON. That is correct. So, that it was an obligation which was not
recognized in the financial statements of PNCC but revived – in the financial
statements because it has prescribed but revived by the board effectively. That's
the theory, at least, of the plaintiff. Is that correct? Who can answer that?
Ms. Pasetes, yes.
MS. PASETES. It is not an obligation of PNCC that is why it is not reflected in the
financial statements.39 (Emphasis supplied)
In short, after two decades of consistently refuting its liability for the Marubeni loans,
the PNCC Board suddenly and inexplicably reversed itself by admitting in October
2000 liability for the Marubeni loans. Just three months after the PNCC Board
recognized the Marubeni loans, Radstock acquired Marubeni's receivable and filed the
present collection case.
Second. The PNCC Board admitted liability for the Marubeni loans despite PNCC’s
total liabilities far exceeding its assets. There is no dispute that the Marubeni loans,
once recognized, would wipe out the assets of PNCC, "virtually emptying the coffers
of the PNCC."40 While PNCC insists that it remains financially viable, the figures in
the COA Audit Reports tell otherwise. 41 For 2006 and 2005, "the Corporation has
incurred negative gross margin of ₱84.531 Million and ₱80.180 Million,
respectively, and net losses that had accumulated in a deficit of ₱14.823 Billion as
of 31 December 2006."42 The COA even opined that "unless [PNCC] Management
addresses the issue on net losses in its financial rehabilitation plan, x x x the
Corporation may not be able to continue its operations as a going concern."
Notably, during the oral arguments before this Court, the Government Corporate
Counsel admitted the PNCC’s huge negative net worth, thus:
JUSTICE CARPIO
65
x x x what is the net worth now of PNCC? Negative what? Negative 6 Billion at MS. OGAN. On record, Mr. Chairman, we have demands starting from - - a series of
least[?] demands which started from May 23, 1984, letter from Marubeni to PNCC, demand
payment. And we also have the letter of September 3, 1986, letter of Marubeni to then
ATTY. AGRA PNCC Chair Mr. Jaime. We have the June 24, 1986 letter from Marubeni to the PNCC
Yes, your Honor.43 (Emphasis supplied) Chairman. Also the March 4, 1988 letter...

Clearly, the PNCC Board’s admission of liability for the Marubeni loans, given SEN. DRILON. The March 4, 1988 letter is not a demand letter.
PNCC’s huge negative net worth of at least ₱6 billion as admitted by PNCC’s counsel, MS. OGAN. It is exactly addressed to the Asset Privatization Trust.
or ₱14.823 billion based on the 2006 COA Audit Report, would leave PNCC an empty
shell, without any assets to pay its biggest creditor, the National Government with an SEN. DRILON. It is not a demand letter? Okay.
admitted receivable of ₱36 billion from PNCC.
MS. OGAN. And we have also...
Third. In a debilitating self-inflicted injury, the PNCC Board revived what appeared to
have been a dead claim by abandoning one of PNCC’s strong defenses, which is the SEN. DRILON. Anyway...
prescription of the action to collect the Marubeni loans. THE CHAIRMAN. Please answer when you are asked, Ms. Ogan. We want to put it
44
Settled is the rule that actions prescribe by the mere lapse of time fixed by law.  Under on the record whether it is "yes" or "no".
Article 1144 of the Civil Code, an action upon a written contract, such as a loan MS. OGAN. Yes, sir.
contract, must be brought within ten years from the time the right of action accrues.
The prescription of such an action is interrupted when the action is filed before the SEN. DRILON. So, even assuming that all of those were demand letters, the 10 years
court, when there is a written extrajudicial demand by the creditor, or when there is prescription set in and it should have prescribed in 1998, whatever is the date, or
any written acknowledgment of the debt by the debtor.45 before the case was filed in 2001.

In this case, Basay Mining obtained the Marubeni loans sometime between 1978 and MR. CIMAFRANCA. The 10-year period for – if the contract is written, it's 10 years
1981. While Radstock claims that numerous demand letters were sent to PNCC, based and it should have prescribed in 10 years and we did raise that in our answer, in our
on the records, the extrajudicial demands to pay the loans appear to have been made motion to dismiss.
only in 1984 and 1986. Meanwhile, the written acknowledgment of the debt, in the
SEN. DRILON. I know. You raised this in your motion to dismiss and you raised this
form of Board Resolution No. BD-092-2000, was issued only on 20 October 2000.
in your answer. Now, we are not saying that you were negligent in not raising that.
Thus, more than ten years would have already lapsed between Marubeni’s extrajudicial What we are just putting on the record that indeed there is basis to argue that these
demands in 1984 and 1986 and the acknowledgment by the PNCC Board of the claims have prescribed.
Marubeni loans in 2000. However, the PNCC Board suddenly passed Board
Now, the reason why there was a colorable basis on the complaint filed in 2001 was
Resolution No. BD-092-2000 expressly admitting liability for the Marubeni loans. In
that somehow the board of PNCC recognized the obligation in a special board meeting
short, the PNCC Board admitted liability for the Marubeni loans despite the fact that
on October 20, 2000. Hindi ba ganoon 'yon?
the same might no longer be judicially collectible. Although the legal advantage was
obviously on its side, the PNCC Board threw in the towel even before the fight could MS. OGAN. Yes, that is correct.
begin. During the Senate hearings, the matter of prescription was discussed, thus:
SEN. DRILON. Why did the PNCC recognize this obligation in 2000 when it was very
SEN. DRILON. ... the prescription period is 10 years and there were no payments – the clear that at that point more than 10 years have lapsed since the last demand letter?
last demands were made, when? The last demands for payment?
MR. AGUILAR. May I volunteer an answer?
MS. OGAN. It was made January 2001 prior to the filing of the case.
SEN. DRILON. Please.
SEN. DRILON. Yes, all right. Before that, when was the last demand made? By the
time they filed the complaint more than 10 years already lapsed.
66
MR. AGUILAR. I looked into that, Mr. Chairman, Your Honor. It was as a result of
and I go to the folder letter "N." In our own demand research it was not period, Your
Honor, that Punongbayan in the big folder, sir, letter "N" it was the period where PMO
was selling PNCC and Punongbayan and Araullo Law Office came out with an
investment brochure that indicated liabilities both to national government and to
Marubeni/Radstock. So, PMO said, "For good order, can you PNCC board confirm
that by board resolution?" That's the tone of the letter.
SEN. DRILON. Confirm what? Confirm the liabilities that are contained in the
Punongbayan investment prospectus both to the national government and to PNCC.
That is the reason at least from the record, Your Honor, how the PNCC board got to
deliberate on the Marubeni.
THE CHAIRMAN. What paragraph? Second to the last paragraph?
MR. AGUILAR. Yes. Yes, Mr. Chairman. Ito po 'yong – that"s to our recollection, in
the records, that was the reason.
SEN. DRILON. Is that the only reason why ...
MR. AGUILAR. From just the records, Mr. Chairman, and then interviews with
people who are still around.
SEN. DRILON. You mean, you acknowledged a prescribed obligation because of this
paragraph?
MR. AGUILAR. I don’t know what legal advice we were following at that time, Mr.
Chairman.46 (Emphasis supplied)
Besides prescription, the Office of the Government Corporate Counsel (OGCC)
originally believed that PNCC had another formidable legal weapon against Radstock,
that is, the lack of authority of Alfredo Asuncion, then Executive Vice-President of
PNCC, to sign the letter of guarantee on behalf of CDCP. During the Senate hearings,
the following exchange reveals the OGCC’s original opinion:
THE CHAIRMAN. What was the opinion of the Office of the Government Corporate
Counsel?
MS. OGAN. The opinion of the Office of the Government Corporate Counsel is that
PNCC should exhaust all means to resist the case using all defenses available to a
guarantee and a surety that there is a valid ground for PNCC's refusal to honor or make
good the alleged guarantee obligation. It appearing that from the documents submitted
to the OGCC that there is no board authority in favor or authorizing Mr. Asuncion,
then EVP, to sign or execute the letter of guarantee in behalf of CDCP and that said
letter of guarantee is not legally binding upon or enforceable against CDCP as
principals, your Honors.47
xxxx
SEN. DRILON. Now that we have read this, what was the opinion of the Government
Corporate Counsel, Mr. Cimafranca?
MR. CIMAFRANCA. Yes, Senator, we did issue an opinion upon the request of
PNCC and our opinion was that there was no valid obligation, no valid guarantee. And
we incorporated that in our pleadings in court.48 (Emphasis supplied)
Clearly, PNCC had strong defenses against the collection suit filed by Radstock, as
originally opined by the OGCC. It is quite puzzling, therefore, that the PNCC Board,
which had solid grounds to refute the legitimacy of the Marubeni loans, admitted its
liability and entered into a Compromise Agreement that is manifestly and grossly
prejudicial to PNCC.
Fourth. The basis for the admission of liability for the Marubeni loans, which was an
opinion of the Feria Law Office, was not even shown to the PNCC Board.
Atty. Raymundo Francisco, the APT trustee overseeing the proposed privatization of
PNCC at the time, was responsible for recommending to the PNCC Board the
admission of PNCC’s liability for the Marubeni loans. Atty. Francisco based his
recommendation solely on a mere alleged opinion of the Feria Law Office. Atty.
Francisco did not bother to show this "Feria opinion" to the members of the PNCC
Board, except to Atty. Renato Valdecantos, who as the then PNCC Chairman did not
also show the "Feria opinion" to the other PNCC Board members. During the Senate
hearings, Atty. Francisco could not produce a copy of the "Feria opinion." The
Senators grilled Atty. Francisco on his recommendation to recognize PNCC’s liability
for the Marubeni loans, thus:
THE CHAIRMAN. x x x You were the one who wrote this letter or rather this
memorandum dated 17 October 2000 to Atty. Valdecantos. Can you tell us the
background why you wrote the letter acknowledging a debt which is non-existent?
MR. FRANCISCO. I was appointed as the trustee in charge of the privatization of the
PNCC at that time, sir. And I was tasked to do a study and engage the services of
financial advisors as well as legal advisors to do a legal audit and financial study on the
position of PNCC. I bidded out these engagements, the financial advisership went to
Punongbayan and Araullo. The legal audit went to the Feria Law Offices.
THE CHAIRMAN. Spell it. Boy Feria?
MR. FRANCISCO. Feria-- Feria.
THE CHAIRMAN. Lugto?
67
MR. FRANCISCO. Yes. Yes, Your Honor. And this was the findings of the Feria Law
Office – that the Marubeni account was a legal obligation.
So, I presented this to our board. Based on the findings of the legal audit conducted by
the Ferial Law Offices, sir.
THE CHAIRMAN. Why did you not ask the government corporate counsel? Why did
you have to ask for the opinion of an outside counsel?
MR. FRANCISCO. That was the – that was the mandate given to us, sir, that we have
to engage the ...
THE CHAIRMAN. Mandate given by whom?
MR. FRANCISCO. That is what we usually do, sir, in the APT.
THE CHAIRMAN. Ah, you get outside counsel?
MR. FRANCISCO. Yes, we...
THE CHAIRMAN. Not necessarily the government corporate counsel?
MR. FRANCISCO. No, sir.
THE CHAIRMAN. So, on the basis of the opinion of outside counsel, private, you
proceeded to, in effect, recognize an obligation which is not even entered in the books
of the PNCC? You probably resuscitated a non-existing obligation anymore?
MR. FRANCISCO. Sir, I just based my recommendation on the professional findings
of the law office that we engaged, sir.
THE CHAIRMAN. Did you not ask for the opinion of the government corporate
counsel?
MR. FRANCISCO. No, sir.
THE CHAIRMAN. Why?
MR. FRANCISCO. I felt that the engagements of the law office was sufficient,
anyway we were going to raise it to the Committee on Privatization for their approval
or disapproval, sir.
THE CHAIRMAN. The COP?
MR. FRANCISCO. Yes, sir.
THE CHAIRMAN. That’s a cabinet level?
MR. FRANCISCO. Yes, sir. And we did that, sir.
THE CHAIRMAN. Now... So you sent your memo to Atty. Renato B. Valdecantos,
who unfortunately is not here but I think we have to get his response to this. And as
part of the minutes of special meeting with the board of directors on October 20, 2000,
the board resolved in its Board Resolution No. 092-2000, the board resolved to
recognize, acknowledge and confirm PNCC’s obligations as of September 30, 1999,
etcetera, etcetera. (A), or rather (B), Marubeni Corporation in the amount of
₱10,740,000.
Now, we asked to be here because the franchise of PNCC is hanging in a balance
because of the – on the questions on this acknowledgement. So we want to be
educated.
Now, the paper trail starts with your letter. So, that’s it – that’s my kuwan, Frank.
Yes, Senator Drilon.
SEN. DRILON. Thank you, Mr. Chairman.
Yes, Atty. Francisco, you have a copy of the minutes of October 20, 2000?
MR. FRANCISCO. I’m sorry, sir, we don’t have a copy.
SEN. DRILON. May we ask the corporate secretary of PNCC to provide us with a
copy?
Okay naman andiyan siya.
(Ms. Ogan handing the document to Mr. Francisco.)
You have familiarized yourselves with the minutes, Atty. Francisco?
MR. FRANCISCO. Yes, sir.
SEN. DRILON. Now, mention is made of a memorandum here on line 8, page 3 of this
board’s minutes. It says, "Director Francisco has prepared a memorandum requesting
confirmation, acknowledgement, and ratification of this indebtedness of PNCC to the
national government which was determined by Bureau of Treasury as of September 30,
1999 is 36,023,784,751. And with respect to PNCC’s obligation to Marubeni, this has
been determined to be in the total amount of 10,743,103,388, also as of September 30,
1999; that there is need to ratify this because there has already been a representation
made with respect to the review of the financial records of PNCC by Punongbayan and
Araullo, which have been included as part of the package of APT’s disposition to the
national government’s interest in PNCC."
You recall having made this representation as found in the minutes, I assume, Atty.
Francisco?
68
MR. FRANCISCO. Yes, sir. But I’d like to be refreshed on the memorandum, sir,
because I don’t have a copy.
SEN. DRILON. Yes, this memorandum was cited earlier by Senator Arroyo, and
maybe the secretary can give him a copy? Give him a copy?
MS. OGAN. (Handing the document to Mr. Francisco.)
MR. FRANCISCO. Your Honor, I have here a memorandum to the PNCC board
through Atty. Valdecantos, which says that – in the last paragraph, if I may read? "May
we request therefore, that a board resolution be adopted, acknowledging and
confirming the aforementioned PNCC obligations with the national government and
Marubeni as borne out by the due diligence audit."
SEN. DRILON. This is the memorandum referred to in these minutes. This
memorandum dated 17 October 2000 is the memorandum referred to in the minutes.
MR. FRANCISCO. I would assume, Mr. Chairman.
SEN. DRILON. Right.
Now, the Punongbayan representative who was here yesterday, Mr...
THE CHAIRMAN. Navarro.
SEN. DRILON. ... Navarro denied that he made this recommendation.
THE CHAIRMAN. He asked for opinion, legal opinion.
SEN. DRILON. He said that they never made this representation and the transcript will
bear us out. They said that they never made this representation that the account of
Marubeni should be recognized.
MR. FRANCISCO. Mr. Chairman, in the memorandum, I only mentioned here the
acknowledgement and confirmation of the PNCC obligations. I was not asking for a
ratification. I never mentioned ratification in the memorandum. I just based my memo
based on the due diligence audit of the Feria Law Offices.
SEN. DRILON. Can you say that again? You never asked for a ratification...
MR. FRANCISCO. No. I never mentioned in my memorandum that I was asking for a
ratification. I was just – in my memo it says, "acknowledging and confirming the
PNCC obligation." This was what ...
SEN. DRILON. Isn’t it the same as ratification? I mean, what’s the difference?
MR. FRANCISCO. I – well, my memorandum was meant really just to confirm the
findings of the legal audit as ...
SEN. DRILON. In your mind as a lawyer, Atty. Francisco, there’s a difference
between ratification and – what’s your term? -- acknowledgment and confirmation?
MR. FRANCISCO. Well, I guess there’s no difference, Mr. Chairman.
SEN. DRILON. Right.
Anyway, just of record, the Punongbayan representatives here yesterday said that they
never made such representation.
In any case, now you’re saying it’s the Feria Law Office who rendered that opinion?
Can we – you know, yesterday we were asking for a copy of this opinion but we were
never furnished one. The ... no less than the Chairman of this Committee was asking
for a copy.
THE CHAIRMAN. Well, copy of the opinion...
MS. OGAN. Yes, Mr. Chairman, we were never furnished a copy of this opinion
because it’s opinion rendered for the Asset Privatization Trust which is its client, not
the PNCC, Mr. Chairman.
THE CHAIRMAN. All right. The question is whether – but you see, this is a
memorandum of Atty. Francisco to the Chairman of the Asset Privatization Trust. You
say now that you were never furnished a copy because that’s supposed to be with the
Asset ...
MS. OGAN. Yes, Mr. Chairman.
THE CHAIRMAN. ... but yet the action of – or rather the opinion of the Feria Law
Offices was in effect adopted by the board of directors of PNCC in its minutes of
October 20, 2000 where you are the corporate secretary, Ms. Ogan.
MS. OGAN. Yes, Mr. Chairman.
THE CHAIRMAN. So, what I am saying is that this opinion or rather the opinion of
the Feria Law Offices of which you don’t have a copy?
MS. OGAN. Yes, sir.
THE CHAIRMAN. And the reason being that, it does not concern the PNCC because
that’s an opinion rendered for APT and not for the PNCC.
MS. OGAN. Yes, Mr. Chairman, that was what we were told although we made
several requests to the APT, sir.
THE CHAIRMAN. All right. Now, since it was for the APT and not for the PNCC, I
ask the question why did PNCC adopt it? That was not for the consumption of PNCC.
It was for the consumption of the Asset Privatization Trust. And that is what Atty.
69
Francisco says and it’s confirmed by you saying that this was a memo – you don’t have
a copy because this was sought for by APT and the Feria Law Offices just provided an
opinion – provided the APT with an opinion. So, as corporate secretary, the board of
directors of PNCC adopted it, recognized the Marubeni Corporation.
You read the minutes of the October 20, 2000 meeting of the board of directors on
Item V. The resolution speaks of .. so, go ahead.
MS. OGAN. I gave my copies. Yes, sir.
THE CHAIRMAN. In effect the Feria Law Offices’ opinion was for the consumption
of the APT.
MS. OGAN. That was what we were told, Mr. Chairman.
THE CHAIRMAN. And you were not even provided with a copy.
THE CHAIRMAN. Yet you adopted it.
MS. OGAN. Yes, sir.
SEN DRILON. Considering you were the corporate secretary.
THE CHAIRMAN. She was the corporate secretary.
SEN. DRILON. She was just recording the minutes.
THE CHAIRMAN. Yes, she was recording.
Now, we are asking you now why it was taken up?
MS. OGAN. Yes, sir, Mr. Chairman, this was mentioned in the memorandum of Atty.
Francisco, memorandum to the board.
SEN. DRILON. Mr. Chairman, Mr. Francisco represented APT in the board of PNCC.
And is that correct, Mr. Francisco?
THE CHAIRMAN. You’re an ex-officio member.
SEN. DRILON. Yes.
MR. FRANCISCO. Ex-officio member only, sir, as trustee in charge of the
privatization of PNCC.
SEN. DRILON. With the permission of Mr. Chair, may I ask a question...
THE CHAIRMAN. Oh, yes, Senator Drilon.
SEN. DRILON. Atty. Francisco, you sat in the PNCC board as APT representative,
you are a lawyer, there was a legal opinion of Feria, Feria, Lugto, Lao Law Offices
which you cited in your memorandum. Did you discuss – first, did you give a copy of
this opinion to PNCC?
MR. FRANCISCO. I gave a copy of this opinion, sir, to our chairman who was also a
member of the board of PNCC, Mr. Valdecantos, sir.
SEN. DRILON. And because he was...
MR. FRANCISCO. Because he was my immediate boss in the APT.
SEN. DRILON. Apparently, [it] just ended up in the personal possession of Mr.
Valdecantos because the corporate secretary, Glenda Ogan, who is supposed to be the
custodian of the records of the board never saw a copy of this.
MR. FRANCISCO. Well, sir, my – the copy that I gave was to Mr. Valdecantos
because he was the one sitting in the PNCC board, sir.
SEN. DRILON. No, you sit in the board.
MR. FRANCISCO. I was just an ex-officio member. And all my reports were coursed
through our Chairman, Mr. Valdecantos, sir.
SEN. DRILON. Now, did you ever tell the board that there is a legal position taken or
at least from the documents it is possible that the claim has prescribed?
MR. FRANCISCO. I took this up in the board meeting of the PNCC at that time and I
told them about this matter, sir.
SEN. DRILON. No, you told them that the claim could have, under the law, could
have prescribed?
MR. FRANCISCO. No, sir.
SEN. DRILON. Why? You mean, you didn’t tell the board that it is possible that this
liability is no longer a valid liability because it has prescribed?
MR. FRANCISCO. I did not dwell into the findings anymore, sir, because I found the
professional opinion of the Feria Law Office to be sufficient.49 (Emphasis supplied)
Atty. Francisco’s act of recommending to the PNCC Board the acknowledgment of the
Marubeni loans based only on an opinion of a private law firm, without consulting the
OGCC and without showing this opinion to the members of the PNCC Board except to
Atty. Valdecantos, reflects how shockingly little his concern was for PNCC, contrary
to his claim that "he only had the interest of PNCC at heart." In fact, if what was
involved was his own money, Atty. Francisco would have preferred not just two, but at
least three different opinions on how to deal with the matter, and he would have
maintained his non-liability.
70
SEN. OSMEÑA. x x x
All right. And lastly, just to clear our minds, there has always been this finger-pointing,
of course, whenever – this is typical Filipino. When they're caught in a bind, they
always point a finger, they pretend they don't know. And it just amazes me that you
have been appointed trustees, meaning, representatives of the Filipino people, that's
what you were at APT, right? You were not Erap's representatives, you were
representative of the Filipino people and you were tasked to conserve the assets that
that had been confiscated from various cronies of the previous administration. And
here, you are asked to recognize the P10 billion debt and you point only to one law
firm. If you have cancer, don't you to a second opinion, a second doctor or a third
doctor? This is just a question. I am just asking you for your opinion if you would take
the advice of the first doctor who tells you that he's got to open you up.
MR. FRANCISCO. I would go to three or more doctors, sir.
SEN. OSMEÑA. Three or more. Yeah, that's right. And in this case the APT did not do
so.
MR. FRANCISCO. We relied on the findings of the …
SEN. OSMEÑA. If these were your money, would you have gone also to obtain a
second, third opinion from other law firms. Kung pera mo itong 10 billion na ito.
Siguro you're not gonna give it up that easily ano, 'di ba?
MR. FRANCISCO. Yes, sir.
SEN. OSMEÑA. You'll probably keep it in court for the next 20 years.
x x x x50 (Emphasis supplied)
This is a clear admission by Atty. Francisco of bad faith in directing the affairs of
PNCC - that he would not have recognized the Marubeni loans if his own funds were
involved or if he were the owner of PNCC.
The PNCC Board admitted liability for the ₱10.743 billion Marubeni loans without
seeing, reading or discussing the "Feria opinion" which was the sole basis for its
admission of liability. Such act surely goes against ordinary human nature, and
amounts to gross negligence and utter bad faith, even bordering on fraud, on the part of
the PNCC Board in directing the affairs of the corporation. Owing loyalty to PNCC
and its stockholders, the PNCC Board should have exercised utmost care and diligence
in admitting a gargantuan debt of ₱10.743 billion that would certainly force PNCC into
insolvency, a debt that previous PNCC Boards in the last two decades consistently
refused to admit.
Instead, the PNCC Board admitted PNCC’s liability for the Marubeni loans relying
solely on a mere opinion of a private law office, which opinion the PNCC Board
members never saw, except for Atty. Valdecantos and Atty. Francisco. The PNCC
Board knew that PNCC, as a government owned and controlled corporation (GOCC),
must rely "exclusively" on the opinion of the OGCC. Section 1 of Memorandum
Circular No. 9 dated 27 August 1998 issued by the President states:
SECTION 1. All legal matters pertaining to government-owned or controlled
corporations, their subsidiaries, other corporate off-springs and government acquired
asset corporations (GOCCs) shall be exclusively referred to and handled by the Office
of the Government Corporate Counsel (OGCC). (Emphasis supplied)
The PNCC Board acted in bad faith in relying on the opinion of a private lawyer
knowing that PNCC is required to rely "exclusively" on the OGCC’s opinion. Worse,
the PNCC Board, in admitting liability for ₱10.743 billion, relied on the
recommendation of a private lawyer whose opinion the PNCC Board members have
not even seen.
During the oral arguments, Atty. Sison explained to the Court that the intention of APT
was for the PNCC Board merely to disclose the claim of Marubeni as part of APT's
full disclosure policy to prospective buyers of PNCC. Atty. Sison stated that it was not
the intention of APT for the PNCC Board to admit liability for the Marubeni loans,
thus:
x x x It was the Asset Privatization Trust A-P-T that was tasked to sell the company.
The A-P-T, for purposes of disclosure statements, tasked the Feria Law Office to
handle the documentation and the study of all legal issues that had to be resolved or
clarified for the information of prospective bidders and or buyers. In the performance
of its assigned task the Feria Law Office came upon the Marubeni claim and
mentioned that the APTC and/or PNCC must disclose that there is a claim by
Marubeni against PNCC for purposes of satisfying the requirements of full disclosure.
This seemingly innocent statement or requirement made by the Feria Law Office was
then taken by two officials of the Asset Privatization Trust and with malice
aforethought turned it into the basis for a multi-billion peso debt by the now
government owned and/or controlled PNCC. x x x.51 (Emphasis supplied)
While the PNCC Board passed Board Resolution No. BD-099-2000 amending Board
Resolution No. BD-092-2000, such amendment merely added conditions for the
recognition of the Marubeni loans, namely, subjecting the recognition to a final
determination by COA of the amount involved and to the declaration by OGCC of the
legality of PNCC’s liability. However, the PNCC Board reiterated and stood firm that
it "recognizes, acknowledges and confirms its obligations" for the Marubeni loans.
Apparently, Board Resolution No. BD-099-2000 was a futile attempt to "revoke"
Board Resolution No. BD-092-2000. Atty. Alfredo Laya, Jr., a former PNCC Director,
71
spoke on his protests against Board Resolution No. BD-092-2000 at the Senate
hearings, thus:
MR. LAYA. Mr. Chairman, if I can …
THE CHAIRMAN. Were you also at the board?
MR. LAYA. At that time, yes, sir.
THE CHAIRMAN. Okay, go ahead.
MR. LAYA. That's why if – maybe this can help clarify the sequence. There was this
meeting on October 20. This matter of the Marubeni liability or account was also
discussed. Mr. Macasaet, if I may try to refresh. And there was some discussion, sir,
and in fact, they were saying even at that stage that there should be a COA or an
OGCC audit. Now, that was during the discussion of October 20. Later on, the minutes
came out. The practice, then, sir, was for the minutes to come out at the start of the
meeting of the subsequent. So the minutes of October 20 came out on November 22
and then we were going over it. And that is in the subsequent minutes of the meeting
… MR. LAYA. I think so, sir. That was our – personally, that was my position.
THE CHAIRMAN. May I interrupt. You were taking up in your November 22 meeting
the October 20 minutes?
MR. LAYA. Yes, sir.
THE CHAIRMAN. This minutes that we have?
MR. LAYA. Yes, sir.
THE CHAIRMAN. All right, go ahead.
MR. LAYA. Now, in the November 22 meeting, we noticed this resolution already for
confirmation of the board – proceedings of October 20. So immediately we made –
actually, protest would be a better term for that – we protested the wording of the
resolution and that's why we came up with this resolution amending the October 20
resolution.
SEN. DRILON. So you are saying, Mr. Laya, that the minutes of October 20 did not
accurately reflect the decisions that you made on October 20 because you were saying
that this recognition should be subject to OGCC and COA? You seem to imply and we
want to make it – and I want to get that for the record. You seem to imply that there
was no decision to recognize the obligation during that meeting because you wanted it
to subject it to COA and OGCC, is that correct?
MR. LAYA. Yes, your Honor.
SEN. DRILON. So how did...
MR. LAYA. That's my understanding of the proceedings at that time, that's why in the
subsequent November 22 meeting, we raised this point about obtaining a COA and
OGCC opinion.
SEN. DRILON. Yes. But you know, the November 22 meeting repeated the wording
of the resolution previously adopted only now you are saying subject to final
determination which is completely of different import from what you are saying was
your understanding of the decision arrived at on October 20.
MR. LAYA. Yes, sir. Because our thinking then...
SEN. DRILON. What do you mean, yes, sir?
MR. LAYA. It's just a claim under discussion but then the way it is translated, as the
minutes of October 20 were not really verbatim.
SEN. DRILON. So, you never intended to recognize the obligation.
SEN. DRILON. How did it happen, Corporate Secretary Ogan, that the minutes did not
reflect what the board …
THE CHAIRMAN. Ms. Pasetes …
MS. PASETES. Yes, Mr. Chairman.
THE CHAIRMAN. … you are the chief financial officer of PNCC.
MS. PASETES. Your Honor, before that November 22 board meeting, management
headed by Mr. Rolando Macasaet, myself and Atty. Ogan had a discussion about the
recognition of the obligations of 10 billion of Marubeni and 36 billion of the national
government on whether to recognize this as an obligation in our books or recognize it
as an obligation in the pro forma financial statement to be used for the privatization of
PNCC because recognizing both obligations in the books of PNCC would defeat our
going concern status and that is where the position of the president then, Mr. Macasaet,
stemmed from and he went back to the board and moved to reconsider the position of
October 20, 2000, Mr. Chair.52 (Emphasis supplied)
In other words, despite Atty. Laya’s objections to PNCC’s admitting liability for the
Marubeni loans, the PNCC Board still admitted the same and merely imposed
additional conditions to temper somehow the devastating effects of Board Resolution
No. BD-092-2000.
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The act of the PNCC Board in issuing Board Resolution No. BD-092-2000 expressly
admitting liability for the Marubeni loans demonstrates the PNCC Board’s gross and
willful disregard of the requisite care and diligence in managing the affairs of PNCC,
amounting to bad faith and resulting in grave and irreparable injury to PNCC and its
stockholders. This reckless and treacherous move on the part of the PNCC Board
clearly constitutes a serious breach of its fiduciary duty to PNCC and its stockholders,
rendering the members of the PNCC Board liable under Section 31 of the Corporation
Code, which provides:
SEC. 31. Liability of directors, trustees or officers. -- Directors or trustees who
willfully and knowingly vote for or assent to patently unlawful acts of the corporation
or who are guilty of gross negligence or bad faith in directing the affairs of the
corporation or acquire any personal or pecuniary interest in conflict with their duty as
such directors or trustees shall be liable jointly and severally for all damages resulting
therefrom suffered by the corporation, its stockholders or members and other persons.
When a director, trustee or officer attempts to acquire or acquires, in violation of his
duty, any interest adverse to the corporation in respect of any matter which has been
reposed in him in confidence, as to which equity imposes a disability upon him to deal
in his own behalf, he shall be liable as a trustee for the corporation and must account
for the profits which otherwise would have accrued to the corporation.
Soon after the short-lived Estrada Administration, the PNCC Board revoked its
previous admission of liability for the Marubeni loans. During the oral arguments,
Atty. Sison narrated to the Court:
x x x After President Estrada was ousted, I was appointed as President and Chairman
of PNCC in April of 2001, this particular board resolution was brought to my attention
and I immediately put the matter before the board. I had no problem in convincing
them to reverse the recognition as it was illegal and had no basis in fact. The vote to
overturn that resolution was unanimous. Strange to say that some who voted to
overturn the recognition were part of the old board that approved it. Stranger still,
Renato Valdecantos who was still a member of the Board voted in favor of reversing
the resolution he himself instigated and pushed. Some of the board members who
voted to recognize the obligation of Marubeni even came to me privately and said
"pinilit lang kami." x x x.53 (Emphasis supplied)
In approving PNCC Board Resolution Nos. BD-092-2000 and BD-099-2000, the
PNCC Board caused undue injury to the Government and gave unwarranted benefits to
Radstock, through manifest partiality, evident bad faith or gross inexcusable
negligence of the PNCC Board. Such acts are declared under Section 3(e) of RA 3019
or the Anti-Graft and Corrupt Practices Act, as "corrupt practices xxx and xxx
unlawful." Being unlawful and criminal acts, these PNCC Board Resolutions are void
ab initio and cannot be implemented or in any way given effect by the Executive or
Judicial branch of the Government.
Not content with forcing PNCC to commit corporate suicide with the admission of
liability for the Marubeni loans under Board Resolution Nos. BD-092-2000 and BD-
099-2000, the PNCC Board drove the last nail on PNCC’s coffin when the PNCC
Board entered into the manifestly and grossly disadvantageous Compromise
Agreement with Radstock. This time, the OGCC, headed by Agnes DST Devanadera,
reversed itself and recommended approval of the Compromise Agreement to the
PNCC Board. As Atty. Sison explained to the Court during the oral arguments:
x x x While the case was pending in the Court of Appeals, Radstock in a rare display
of extreme generosity, conveniently convinced the Board of PNCC to enter into a
compromise agreement for ½ the amount of the judgment rendered by the RTC or ₱6.5
Billion Pesos. This time the OGCC, under the leadership of now Solicitor General
Agnes Devanadera, approved the compromise agreement abandoning the previous
OGCC position that PNCC had a meritorious case and would be hard press to lose the
case. What is strange is that although the compromise agreement we seek to stop
ostensibly is for ₱6.5 Billion only, truth and in fact, the agreement agrees to convey to
Radstock all or substantially all of the assets of PNCC worth ₱18 Billion Pesos. There
are three items that are undervalued here, the real estate that was turned over as a result
of the controversial agreement, the toll revenues that were being assigned and the value
of the new shares of PNCC the difference is about ₱12 Billion Pesos. x x x (Emphasis
supplied)
V.
The Compromise Agreement is Void
for Being Contrary to the Constitution,
Existing Laws, and Public Policy
For a better understanding of the present case, the pertinent terms and conditions of the
Compromise Agreement between PNCC and Radstock are quoted below:
COMPROMISE AGREEMENT
KNOW ALL MEN BY THESE PRESENTS:
This Agreement made and entered into this 17th day of August 2006, in Mandaluyong
City, Metro Manila, Philippines, by and between:
PHILIPPINE NATIONAL CONSTRUCTION CORPORATION, a government
acquired asset corporation, created and existing under the laws of the Republic of the
Philippines, with principal office address at EDSA corner Reliance Street,
Mandaluyong City, Philippines, duly represented herein by its Chairman ARTHUR N.
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AGUILAR, pursuant to a Board Resolution attached herewith as Annex "A" and made
an integral part hereof, hereinafter referred to as PNCC;
- and -
RADSTOCK SECURITIES LIMITED, a private corporation incorporated in the
British Virgin Islands, with office address at Suite 1402 1 Duddell Street, Central
Hongkong duly-represented herein by its Director, CARLOS G. DOMINGUEZ,
pursuant to a Board Resolution attached herewith as Annex "B" and made an integral
part hereof, hereinafter referred to as RADSTOCK.
WITNESSETH:
WHEREAS, on January 15, 2001, RADSTOCK, as assignee of Marubeni Corporation,
filed a complaint for sum of money and damages with application for a writ of
preliminary attachment with the Regional Trial Court (RTC), Mandaluyong City,
docketed as Civil Case No. MC-01-1398, to collect on PNCC’s guarantees on the
unpaid loan obligations of CDCP Mining Corporation as provided under an Advance
Payment Agreement and Loan Agreement;
WHEREAS, on December 10, 2002, the RTC of Mandaluyong rendered a decision in
favor of plaintiff RADSTOCK directing PNCC to pay the total amount of Thirteen
Billion One Hundred Fifty One Million Nine Hundred Fifty-Six Thousand Five
Hundred Twenty-Eight Pesos (₱13,151,956,528.00) with interest from October 15,
2001 plus Ten Million Pesos (₱10,000,000.00) as attorney's fees.
WHEREAS, PNCC had elevated the case to the Court of Appeals (CA-G.R. SP No.
66654) on Certiorari and thereafter, to the Supreme Court (G.R. No. 156887) which
Courts have consistently ruled that the RTC did not commit grave abuse of discretion
when it denied PNCC’s Motion to Dismiss which sets forth similar or substantially the
same grounds or defenses as those raised in PNCC's Answer;
WHEREAS, the case has remained pending for almost six (6) years even after the
main action was appealed to the Court of Appeals;
WHEREAS, on the basis of the RTC Decision dated December 10, 2002, the current
value of the judgment debt against PNCC stands at ₱17,040,843,968.00 as of July 31,
2006 (the "Judgment Debt");
WHEREAS, RADSTOCK is willing to settle the case at the reduced Compromise
Amount of Six Billion One Hundred Ninety-Six Million Pesos (₱6,196,000,000.00)
which may be paid by PNCC, either in cash or in kind to avoid the trouble and
inconvenience of further litigation as a gesture of goodwill and cooperation;
WHEREAS, it is an established legal policy or principle that litigants in civil cases
should be encouraged to compromise or amicably settle their claims not only to avoid
litigation but also to put an end to one already commenced (Articles 2028 and 2029,
Civil Code);
WHEREAS, this Compromise Agreement has been approved by the respective Board
of Directors of both PNCC and RADSTOCK, subject to the approval of the Honorable
Court;
NOW, THEREFORE, for and in consideration of the foregoing premises, and the
mutual covenants, stipulations and agreements herein contained, PNCC and
RADSTOCK have agreed to amicably settle the above captioned Radstock case under
the following terms and conditions:
1. RADSTOCK agrees to receive and accept from PNCC in full and complete
settlement of the Judgment Debt, the reduced amount of Six Billion, One Hundred
Ninety-Six Million Pesos (₱6,196,000,000.00) (the "Compromise Amount").
2. This Compromise Amount shall be paid by PNCC to RADSTOCK in the following
manner:
a. PNCC shall assign to a third party assignee to be designated by RADSTOCK all its
rights and interests to the following real properties provided the assignee shall be duly
qualified to own real properties in the Philippines;
(1) PNCC’s rights over that parcel of land located in Pasay City with a total area of
One Hundred Twenty-Nine Thousand Five Hundred Forty-Eight (129,548) square
meters, more or less, and which is covered by and more particularly described in
Transfer Certificate of Title No. T-34997 of the Registry of Deeds for Pasay City. The
transfer value is ₱3,817,779,000.00.
PNCC’s rights and interests in Transfer Certificate of Title No. T-34997 of the
Registry of Deeds for Pasay City is defined and delineated by Administrative Order
No. 397, Series of 1998, and RADSTOCK is fully aware and recognizes that PNCC
has an undertaking to cede at least 2 hectares of this property to its creditor, the
Philippine National Bank; and that furthermore, the Government Service Insurance
System has also a current and existing claim in the nature of boundary conflicts, which
undertaking and claim will not result in the diminution of area or value of the property.
Radstock recognizes and acknowledges the rights and interests of GSIS over the said
property.
(2) T-452587 (T-23646) - Parañaque (5,123 sq. m.) subject to the clarification of the
Privatization and Management Office (PMO) claims thereon. The transfer value is
₱45,000,900.00.
(3) T-49499 (529715 including T-68146-G (S-29716) (1,9747-A)-Parañaque (107 sq.
m.) (54 sq. m.) subject to the clarification of the Privatization and Management Office
(PMO) claims thereon. The transfer value is ₱1,409,100.00.
74
(4) 5-29716-Parañaque (27,762 sq. m.) subject to the clarification of the Privatization
and Management Office (PMO) claims thereon. The transfer value is ₱242,917,500.00.
(5) P-169 - Tagaytay (49,107 sq. m.). The transfer value is ₱13,749,400.00.
(6) P-170 - Tagaytay (49,100 sq. m.). The transfer value is ₱13,749,400.00.
(7) N-3320 - Town and Country Estate, Antipolo (10,000 sq. m.). The transfer value is
₱16,800,000.00.
(8) N-7424 - Antipolo (840 sq. m.). The transfer value is ₱940,800.00.
(9) N-7425 - Antipolo (850 sq. m.). The transfer value is ₱952,000.00.
(10) N-7426 - Antipolo (958 sq. m.). The transfer value is ₱1,073,100.00.
(11) T-485276 - Antipolo (741 sq. m.). The transfer value is ₱830,200.00.
(12) T-485277 - Antipolo (680 sq. m.). The transfer value is ₱761,600.00.
(13) T-485278 - Antipolo (701 sq. m.). The transfer value is ₱785,400.00.
(14) T-131500 - Bulacan (CDCP Farms Corp.) (4,945 sq, m.). The transfer value is
₱6,475,000.00.
(15) T-131501 - Bulacan (678 sq. m.). The transfer value is ₱887,600.00.
(16) T-26,154 (M) - Bocaue, Bulacan (2,841 sq. m.). The transfer value is
₱3,779,300.00.
(17) T-29,308 (M) - Bocaue, Bulacan (733 sq. m.). The transfer value is ₱974,400.00.
(18) T-29,309 (M) Bocaue, Bulacan (1,141 sq. m.). The transfer value is
₱1,517,600.00.
(19) T-260578 (R. Bengzon) Sta. Rita, Guiguinto, Bulacan (20,000 sq. m.). The
transfer value is ₱25,200,000.00.
The transfer values of the foregoing properties are based on 70% of the appraised value
of the respective properties.
b. PNCC shall issue to RADSTOCK or its assignee common shares of the capital stock
of PNCC issued at par value which shall comprise 20% of the outstanding capital stock
of PNCC after the conversion to equity of the debt exposure of the Privatization
Management Office (PMO) and the National Development Company (NDC) and other
government agencies and creditors such that the total government holdings shall not
fall below 70% voting equity subject to the approval of the Securities and Exchange
Commission (SEC) and ratification of PNCC’s stockholders, if necessary. The
assigned value of the shares issued to RADSTOCK is ₱713 Million based on the
approximate last trading price of PNCC shares in the Philippine Stock Exchange as the
date of this agreement, based further on current generally accepted accounting
standards which stipulates the valuation of shares to be based on the lower of cost or
market value.
Subject to the procurement of any and all necessary approvals from the relevant
governmental authorities, PNCC shall deliver to RADSTOCK an instrument
evidencing an undertaking of the Privatization and Management Office (PMO) to give
RADSTOCK or its assignee the right to match any offer to buy the shares of the capital
stock and debts of PNCC held by PMO, in the event the same shares and debt are
offered for privatization.
c. PNCC shall assign to RADSTOCK or its assignee 50% of the PNCC's 6% share in
the gross toll revenue of the Manila North Tollways Corporation (MNTC), with a Net
Present Value of ₱1.287 Billion computed in the manner outlined in Annex "C" herein
attached as an integral part hereof, that shall be due and owing to PNCC pursuant to
the Joint Venture Agreement between PNCC and First Philippine Infrastructure
Development Corp. dated August 29, 1995 and other related existing agreements,
commencing in 2008. It shall be understood that as a result of this assignment, PNCC
shall charge and withhold the amounts, if any, pertaining to taxes due on the amounts
assigned.
Under the Compromise Agreement, PNCC shall pay Radstock the reduced amount of
₱6,185,000,000.00 in full settlement of PNCC’s guarantee of CDCP Mining’s debt
allegedly totaling ₱17,040,843,968.00 as of 31 July 2006. To satisfy its reduced
obligation, PNCC undertakes to (1) "assign to a third party assignee to be designated
by Radstock all its rights and interests" to the listed real properties therein; (2) issue to
Radstock or its assignee common shares of the capital stock of PNCC issued at par
value which shall comprise 20% of the outstanding capital stock of PNCC; and (3)
assign to Radstock or its assignee 50% of PNCC’s 6% share, for the next 27 years
(2008-2035), in the gross toll revenues of the Manila North Tollways Corporation.
A. The PNCC Board has no power to compromise
the ₱6.185 billion amount.
Does the PNCC Board have the power to compromise the ₱6.185 billion "reduced"
amount? The answer is in the negative.1avvphi1
The Dissenting Opinion asserts that PNCC has the power, citing Section 36(2) of
Presidential Decree No. 1445 (PD 1445), otherwise known as the Government
Auditing Code of the Philippines, enacted in 1978. Section 36 states:
SECTION 36. Power to Compromise Claims. — (1) When the interest of the
government so requires, the Commission may compromise or release in whole or in
75
part, any claim or settled liability to any government agency not exceeding ten
thousand pesos and with the written approval of the Prime Minister, it may likewise
compromise or release any similar claim or liability not exceeding one hundred
thousand pesos, the application for relief therefrom shall be submitted, through the
Commission and the Prime Minister, with their recommendations, to the National
Assembly.
(2) The respective governing bodies of government-owned or controlled corporations,
and self-governing boards, commissions or agencies of the government shall have the
exclusive power to compromise or release any similar claim or liability when expressly
authorized by their charters and if in their judgment, the interest of their respective
corporations or agencies so requires. When the charters do not so provide, the power to
compromise shall be exercised by the Commission in accordance with the preceding
paragraph. (Emphasis supplied)
The Dissenting Opinion asserts that since PNCC is incorporated under the Corporation
Code, the PNCC Board has all the powers granted to the governing boards of
corporations incorporated under the Corporation Code, which includes the power to
compromise claims or liabilities.
Section 36 of PD 1445, enacted on 11 June 1978, has been superseded by a later law --
Section 20(1), Chapter IV, Subtitle B, Title I, Book V of Executive Order No. 292 or
the Administrative Code of 1987, which provides:
Section 20. Power to Compromise Claims. - (1) When the interest of the Government
so requires, the Commission may compromise or release in whole or in part, any
settled claim or liability to any government agency not exceeding ten thousand pesos
arising out of any matter or case before it or within its jurisdiction, and with the written
approval of the President, it may likewise compromise or release any similar claim or
liability not exceeding one hundred thousand pesos. In case the claim or liability
exceeds one hundred thousand pesos, the application for relief therefrom shall be
submitted, through the Commission and the President, with their recommendations, to
the Congress[.] x x x (Emphasis supplied)
Under this provision,54 the authority to compromise a settled claim or liability
exceeding ₱100,000.00 involving a government agency, as in this case where the
liability amounts to ₱6.185 billion, is vested not in COA but exclusively in Congress.
Congress alone has the power to compromise the ₱6.185 billion purported liability of
PNCC. Without congressional approval, the Compromise Agreement between PNCC
and Radstock involving ₱6.185 billion is void for being contrary to Section 20(1),
Chapter IV, Subtitle B, Title I, Book V of the Administrative Code of 1987.
PNCC is a "government agency" because Section 2 on Introductory Provisions of the
Revised Administrative Code of 1987 provides that –
Agency of the Government refers to any of the various units of the Government,
including a department, bureau, office, instrumentality, or government-owned or
controlled corporation, or a local government or a distinct unit therein. (Boldfacing
supplied)
Thus, Section 20(1), Chapter IV, Subtitle B, Title I, Book V of the Administrative
Code of 1987 applies to PNCC, which indisputably is a government owned or
controlled corporation.
In the same vein, the COA’s stamp of approval on the Compromise Agreement is void
for violating Section 20(1), Chapter IV, Subtitle B, Title I, Book V of the
Administrative Code of 1987. Clearly, the Dissenting Opinion’s reliance on the COA’s
finding that the terms and conditions of the Compromise Agreement are "fair and
above board" is patently erroneous.
Citing Benedicto v. Board of Administrators of Television Stations RPN, BBC and
IBC,55 the Dissenting Opinion views that congressional approval is not required for the
validity of the Compromise Agreement because the liability of PNCC is not yet
"settled."
In Benedicto, the PCGG filed in the Sandiganbayan a civil case to recover from the
defendants (including Roberto S. Benedicto) their ill-gotten wealth consisting of funds
and other properties. The PCGG executed a compromise agreement with Roberto S.
Benedicto ceding to the latter a substantial part of his ill-gotten assets and the State
granting him immunity from further prosecution. The Court held that prior
congressional approval is not required for the PCGG to enter into a compromise
agreement with persons against whom it has filed actions for recovery of ill-gotten
wealth.
In Benedicto, the Court found that the government’s claim against Benedicto was not
yet settled unlike here where the PNCC Board expressly admitted the liability of
PNCC for the Marubeni loans. In Benedicto, the ownership of the alleged ill-gotten
assets was still being litigated in the Sandiganbayan and no party ever admitted any
liability, unlike here where the PNCC Board had already admitted through a formal
Board Resolution PNCC’s liability for the Marubeni loans. PNCC’s express admission
of liability for the Marubeni loans is essentially the premise of the execution of the
Compromise Agreement. In short, Radstock’s claim against PNCC is settled by virtue
of PNCC’s express admission of liability for the Marubeni loans. The Compromise
Agreement merely reduced this settled liability from ₱17 billion to ₱6.185 billion.
The provision of the Revised Administrative Code on the power to settle claims or
liabilities was precisely enacted to prevent government agencies from admitting
liabilities against the government, then compromising such "settled" liabilities. The
present case is exactly what the law seeks to prevent, a compromise agreement on a
76
creditor’s claim settled through admission by a government agency without the
approval of Congress for amounts exceeding ₱100,000.00. What makes the application
of the law even more necessary is that the PNCC Board’s twin moves are manifestly
and grossly disadvantageous to the Government. First, the PNCC admitted solidary
liability for a staggering ₱10.743 billion private debt incurred by a private corporation
which PNCC does not even control. Second, the PNCC Board agreed to pay Radstock
₱6.185 billion as a compromise settlement ahead of all other creditors, including the
Government which is the biggest creditor.
The Dissenting Opinion further argues that since the PNCC is incorporated under the
Corporation Code, it has the power, through its Board of Directors, to compromise just
like any other private corporation organized under the Corporation Code. Thus, the
Dissenting Opinion states:
Not being a government corporation created by special law, PNCC does not owe its
creation to some charter or special law, but to the Corporation Code. Its powers are
enumerated in the Corporation Code and its articles of incorporation. As an
autonomous entity, it undoubtedly has the power to compromise, and to enter into a
settlement through its Board of Directors, just like any other private
corporation organized under the Corporation Code. To maintain otherwise is to ignore
the character of PNCC as a corporate entity organized under the Corporation Code, by
which it was vested with a personality and identity distinct and separate from those of
its stockholders or members. (Boldfacing and underlining supplied)
The Dissenting Opinion is woefully wide off the mark. The PNCC is not "just like any
other private corporation" precisely because it is not a private corporation but
indisputably a government owned corporation. Neither is PNCC "an autonomous
entity" considering that PNCC is under the Department of Trade and Industry, over
which the President exercises control. To claim that PNCC is an "autonomous entity"
is to say that it is a lost command in the Executive branch, a concept that violates the
President's constitutional power of control over the entire Executive branch of
government.56
The government nominees in the PNCC Board, who practically compose the entire
PNCC Board, are public officers subject to the Anti-Graft and Corrupt Practices Act,
accountable to the Government and the Filipino people. To hold that a corporation
incorporated under the Corporation Code, despite its being 90.3% owned by the
Government, is "an autonomous entity" that could solely through its Board of
Directors compromise, and transfer ownership of, substantially all its assets to a private
third party without the approval required under the Administrative Code of 1987, 57 is
to invite the plunder of all such government owned corporations.
The Dissenting Opinion’s claim that PNCC is an autonomous entity just like any other
private corporation is inconsistent with its assertion that Section 36(2) of the
Government Auditing Code is the governing law in determining PNCC's power to
compromise. Section 36(2) of the Government Auditing Code expressly states that it
applies to the governing bodies of "government-owned or controlled corporations."
The phrase "government-owned or controlled corporations" refers to both those created
by special charter as well as those incorporated under the Corporation Code. Section 2,
Article IX-D of the Constitution provides:
SECTION 2. (1) The Commission on Audit shall have the power, authority, and duty
to examine, audit, and settle all accounts pertaining to the revenue and receipts of, and
expenditures or uses of funds and property, owned or held in trust by, or pertaining to,
the Government, or any of its subdivisions, agencies, or instrumentalities, including
government-owned or controlled corporations with original charters, and on a post-
audit basis: (a) constitutional bodies, commissions and offices that have been granted
fiscal autonomy under this Constitution; (b) autonomous state colleges and
universities; (c) other government-owned or controlled corporations and their
subsidiaries; and (d) such non-governmental entities receiving subsidy or equity,
directly or indirectly, from or through the Government, which are required by law or
the granting institution to submit to such audit as a condition of subsidy or equity.
However, where the internal control system of the audited agencies is inadequate, the
Commission may adopt such measures, including temporary or special pre-audit, as are
necessary and appropriate to correct the deficiencies. It shall keep the general accounts
of the Government and, for such period as may be provided by law, preserve the
vouchers and other supporting papers pertaining thereto.
(2) The Commission shall have exclusive authority, subject to the limitations in this
Article, to define the scope of its audit and examination, establish the techniques and
methods required therefor, and promulgate accounting and auditing rules and
regulations, including those for the prevention and disallowance of irregular,
unnecessary, excessive, extravagant, or unconscionable expenditures, or uses of
government funds and properties. (Emphasis supplied)
In explaining the extent of the jurisdiction of COA over government owned or
controlled corporations, this Court declared in Feliciano v. Commission on Audit:58
The COA's audit jurisdiction extends not only to government "agencies or
instrumentalities," but also to "government-owned and controlled corporations with
original charters" as well as "other government-owned or controlled corporations"
without original charters.
xxxx
Petitioner forgets that the constitutional criterion on the exercise of COA's audit
jurisdiction depends on the government's ownership or control of a corporation. The
nature of the corporation, whether it is private, quasi-public, or public is immaterial.
77
The Constitution vests in the COA audit jurisdiction over "government-owned and
controlled corporations with original charters," as well as "government-owned or
controlled corporations" without original charters. GOCCs with original charters are
subject to COA pre-audit, while GOCCs without original charters are subject to COA
post-audit. GOCCs without original charters refer to corporations created under the
Corporation Code but are owned or controlled by the government. The nature or
purpose of the corporation is not material in determining COA's audit jurisdiction.
Neither is the manner of creation of a corporation, whether under a general or special
law.
Clearly, the COA’s audit jurisdiction extends to government owned or controlled
corporations incorporated under the Corporation Code. Thus, the COA must apply the
Government Auditing Code in the audit and examination of the accounts of such
government owned or controlled corporations even though incorporated under the
Corporation Code. This means that Section 20(1), Chapter IV, Subtitle B, Title I, Book
V of the Administrative Code of 1987 on the power to compromise, which superseded
Section 36 of the Government Auditing Code, applies to the present case in
determining PNCC’s power to compromise. In fact, the COA has been regularly
auditing PNCC on a post-audit basis in accordance with Section 2, Article IX-D of the
Constitution, the Government Auditing Code, and COA rules and regulations.
B. PNCC’s toll fees are public funds.
PD 1113 granted PNCC a 30-year franchise to construct, operate and maintain toll
facilities in the North and South Luzon Expressways. Section 1 of PD 111359 provides:
Section 1. Any provision of law to the contrary notwithstanding, there is hereby
granted to the Construction and Development Corporation of the Philippines (CDCP),
a corporation duly organized and registered under the laws of the Philippines,
hereinafter called the GRANTEE, for a period of thirty (30) years from May 1, 1977
the right, privilege and authority to construct, operate and maintain toll facilities
covering the expressways from Balintawak (Station 9 + 563) to Carmen, Rosales,
Pangasinan and from Nichols, Pasay City (Station 10 + 540) to Lucena, Quezon,
hereinafter referred to collectively as North Luzon Expressway, respectively.
The franchise herein granted shall include the right to collect toll fees at such rates as
may be fixed and/or authorized by the Toll Regulatory Board hereinafter referred to as
the Board created under Presidential Decree No. 1112 for the use of the expressways
above-mentioned. (Emphasis supplied)
60
Section 2 of PD 1894,  which amended PD 1113 to include in PNCC’s franchise the
Metro Manila expressway, also provides:
Section 2. The term of the franchise provided under Presidential Decree No. 1113 for
the North Luzon Expressway and the South Luzon Expressway which is thirty (30)
years from 1 May 1977 shall remain the same; provided that, the franchise granted for
the Metro Manila Expressway and all extensions linkages, stretches and diversions that
may be constructed after the date of approval of this decree shall likewise have a term
of thirty (30) years commencing from the date of completion of the project. (Emphasis
supplied)
Based on these provisions, the franchise of the PNCC expired on 1 May 2007 or thirty
years from 1 May 1977.
PNCC, however, claims that under PD 1894, the North Luzon Expressway (NLEX)
shall have a term of 30 years from the date of its completion in 2005. PNCC argues
that the proviso in Section 2 of PD 1894 gave "toll road projects completed within the
franchise period and after the approval of PD No. 1894 on 12 December 1983 their
own thirty-year term commencing from the date of the completion of the said project,
notwithstanding the expiry of the said franchise."
This contention is untenable.
The proviso in Section 2 of PD 1894 refers to the franchise granted for the Metro
Manila Expressway and all extensions linkages, stretches and diversions constructed
after the approval of PD 1894. It does not pertain to the NLEX because the term of the
NLEX franchise, "which is 30 years from 1 May 1977, shall remain the same," as
expressly provided in the first sentence of the same Section 2 of PD 1894. To construe
that the NLEX franchise had a new term of 30 years starting from 2005 glaringly
conflicts with the plain, clear and unequivocal language of the first sentence of Section
2 of PD 1894. That would be clearly absurd.
There is no dispute that Congress did not renew PNCC’s franchise after its expiry on 1
May 2007. However, PNCC asserts that it "remains a viable corporate entity even after
the expiration of its franchise under Presidential Decree No. 1113." PNCC points out
that the Toll Regulatory Board (TRB) granted PNCC a "Tollway Operation
Certificate" (TOC) which conferred on PNCC the authority to operate and maintain
toll facilities, which includes the power to collect toll fees. PNCC further posits that
the toll fees are private funds because they represent "the consideration given to
tollway operators in exchange for costs they incurred or will incur in constructing,
operating and maintaining the tollways."
This contention is devoid of merit.
With the expiration of PNCC’s franchise, the assets and facilities of PNCC were
automatically turned over, by operation of law, to the government at no cost. Sections
2(e) and 9 of PD 1113 and Section 5 of PD 1894 provide:
Section 2 [of PD 1113]. In consideration of this franchise, the GRANTEE shall:
78
(e) Turn over the toll facilities and all equipment directly related thereto to the Okay. Now, when the franchise of PNCC expired on May 7, 2007, under the terms of
government upon expiration of the franchise period without cost. the franchise under PD 1896, all the assets, toll way assets, equipment, etcetera of
PNCC became owned by government at no cost, correct, under the franchise?
Section 9 [of PD 1113]. For the purposes of this franchise, the Government, shall turn
over to the GRANTEE (PNCC) not later than April 30, 1977 all physical assets and DEAN AGABIN:
facilities including all equipment and appurtenances directly related to the operations
of the North and South Toll Expressways: Provided, That, the extensions of such Yes, Your Honor.
Expressways shall also be turned over to GRANTEE upon completion of their ASSOCIATE JUSTICE CARPIO:
construction or of functional sections thereof: Provided, However, That upon
termination of the franchise period, said physical assets and facilities including Okay. So this is now owned by the national government. [A]ny income from these
improvements thereon, together with equipment and appurtenances directly related to assets of the national government is national government income, correct?
their operations, shall be turned over to the Government without any cost or obligation
DEAN AGABIN:
on the part of the latter. (Emphasis supplied)
Yes, Your Honor.62
Section 5 [of PD No. 1894]. In consideration of this franchise, the GRANTEE shall:
xxxx
(a) Construct, operate and maintain at its own expense the Expressways; and
ASSOCIATE JUSTICE CARPIO:
(b) Turn over, without cost, the toll facilities and all equipment, directly related thereto
to the Government upon expiration of the franchise period. (Emphasis supplied) x x x My question is very simple x x x Is the income from these assets of the national
government (interrupted)
The TRB does not have the power to give back to PNCC the toll assets and facilities
which were automatically turned over to the Government, by operation of law, upon DEAN AGABIN:
the expiration of the franchise of the PNCC on 1 May 2007. Whatever power the TRB
may have to grant authority to operate a toll facility or to issue a "Tollway Operation Yes, Your Honor.63
Certificate," such power does not obviously include the authority to transfer back to
xxxx
PNCC ownership of National Government assets, like the toll assets and facilities,
which have become National Government property upon the expiry of PNCC’s ASSOCIATE JUSTICE CARPIO:
franchise. Such act by the TRB would repeal Section 5 of PD 1894 which
automatically vested in the National Government ownership of PNCC’s toll assets and So, it’s the government [that] decides whether it goes to the general fund or another
facilities upon the expiry of PNCC’s franchise. The TRB obviously has no power to fund. [W]hat is that other fund? Is there another fund where revenues of the
repeal a law. Further, PD 1113, as amended by PD 1894, granting the franchise to government go?
PNCC, is a later law that must necessarily prevail over PD 1112 creating the TRB.
DEAN AGABIN:
Hence, the provisions of PD 1113, as amended by PD 1894, are controlling.
It’s the same fund, Your Honor, except that (interrupted)
The government’s ownership of PNCC's toll assets and facilities inevitably results in
the government’s ownership of the toll fees and the net income derived from these toll ASSOCIATE JUSTICE CARPIO:
assets and facilities. Thus, the toll fees form part of the National Government’s
General Fund, which includes public moneys of every sort and other resources So it goes to the general fund?
pertaining to any agency of the government.61 Even Radstock’s counsel admits that DEAN AGABIN:
the toll fees are public funds, to wit:
Except that it can be categorized as a private fund in a commercial sense, and it can be
ASSOCIATE JUSTICE CARPIO: categorized as a public fund in a Public Law sense.

ASSOCIATE JUSTICE CARPIO:

79
Okay. So we agree that, okay, it goes to the general fund. I agree with you, but you are used solely for public purposes, as expressly mandated by Section 4(2) of PD 1445 or
saying it is categorized still as a private funds? the Government Auditing Code.65

DEAN AGABIN: Section 29(1), Article VI of the Constitution provides:

Yes, Your Honor. Section 29(1). No money shall be paid out of the Treasury except in pursuance of an
appropriation made by law.
ASSOCIATE JUSTICE CARPIO:
The power to appropriate money from the General Funds of the Government belongs
But it’s part of the general fund. Now, if it is part of the general fund, who has the exclusively to the Legislature. Any act in violation of this iron-clad rule is
authority to spend that money? unconstitutional.
DEAN AGABIN: Reinforcing this Constitutional mandate, Sections 84 and 85 of PD 1445 require that
Well, the National Government itself. before a government agency can enter into a contract involving the expenditure of
government funds, there must be an appropriation law for such expenditure, thus:
ASSOCIATE JUSTICE CARPIO:
Section 84. Disbursement of government funds.
Who in the National Government, the Executive, Judiciary or Legislative?
1. Revenue funds shall not be paid out of any public treasury or depository except in
DEAN AGABIN: pursuance of an appropriation law or other specific statutory authority.
Well, the funds are usually appropriated by the Congress. xxxx
ASSOCIATE JUSTICE CARPIO: Section 85. Appropriation before entering into contract.
x x x you mean to say there are exceptions that money from the general fund can be 1. No contract involving the expenditure of public funds shall be entered into unless
spent by the Executive without going t[hrough] Congress, or xxx is [that] the absolute there is an appropriation therefor, the unexpended balance of which, free of other
rule? obligations, is sufficient to cover the proposed expenditure.
DEAN AGABIN: xxxx
Well, in so far as the general fund is concerned, that is the absolute rule set aside by the Section 86 of PD 1445, on the other hand, requires that the proper accounting official
National Government. must certify that funds have been appropriated for the purpose. 66 Section 87 of PD
1445 provides that any contract entered into contrary to the requirements of
ASSOCIATE JUSTICE CARPIO:
Sections 85 and 86 shall be void, thus:
x x x you are saying this is general fund money - the collection from the assets[?]
Section 87. Void contract and liability of officer. Any contract entered into contrary to
DEAN AGABIN: the requirements of the two immediately preceding sections shall be void, and the
officer or officers entering into the contract shall be liable to the government or other
Yes.64 (Emphasis supplied) contracting party for any consequent damage to the same extent as if the transaction
had been wholly between private parties. (Emphasis supplied)
Forming part of the General Fund, the toll fees can only be disposed of in accordance
with the fundamental principles governing financial transactions and operations of any Applying Section 29(1), Article VI of the Constitution, as implanted in Sections 84 and
government agency, to wit: (1) no money shall be paid out of the Treasury except in 85 of the Government Auditing Code, a law must first be enacted by Congress
pursuance of an appropriation made by law, as expressly mandated by Section 29(1), appropriating ₱6.185 billion as compromise money before payment to Radstock can be
Article VI of the Constitution; and (2) government funds or property shall be spent or made.67 Otherwise, such payment violates a prohibitory law and thus void under
Article 5 of the Civil Code which states that "[a]cts executed against the provisions

80
of mandatory or prohibitory laws shall be void, except when the law itself ASSOCIATE JUSTICE CARPIO:
authorizes their validity."
Okay, I agree with you. Now, you are saying that money can be paid out of the general
Indisputably, without an appropriation law, PNCC cannot lawfully pay ₱6.185 billion fund only through an appropriation by Congress, correct? That’s what you are saying.
to Radstock. Any contract allowing such payment, like the Compromise Agreement,
"shall be void" as provided in Section 87 of the Government Auditing Code. In DEAN AGABIN:
Comelec v. Quijano-Padilla,68 this Court ruled: Yes, Your Honor.
Petitioners are justified in refusing to formalize the contract with PHOTOKINA. ASSOCIATE JUSTICE CARPIO:
Prudence dictated them not to enter into a contract not backed up by sufficient
appropriation and available funds. Definitely, to act otherwise would be a futile I agree with you also. Okay, now, can PNCC xxx use this money to pay Radstock
exercise for the contract would inevitably suffer the vice of nullity. In Osmeña vs. without Congressional approval?
Commission on Audit, this Court held:
DEAN AGABIN:
The Auditing Code of the Philippines (P.D. 1445) further provides that no contract
Well, I believe that that may not be necessary. Your Honor, because earlier, the
involving the expenditure of public funds shall be entered into unless there is an
government had already decreed that PNCC should be properly paid for the
appropriation therefor and the proper accounting official of the agency concerned shall
reclamation works which it had done. And so (interrupted)
have certified to the officer entering into the obligation that funds have been duly
appropriated for the purpose and the amount necessary to cover the proposed contract ASSOCIATE JUSTICE CARPIO:
for the current fiscal year is available for expenditure on account thereof. Any contract
entered into contrary to the foregoing requirements shall be VOID. No. I am talking of the funds.

Clearly then, the contract entered into by the former Mayor Duterte was void from the DEAN AGABIN:
very beginning since the agreed cost for the project (₱,368,920.00) was way beyond
And so it is like a foreign obligation.
the appropriated amount (₱,419,180.00) as certified by the City Treasurer. Hence, the
contract was properly declared void and unenforceable in COA's 2nd Indorsement, ASSOCIATE JUSTICE CARPIO:
dated September 4, 1986. The COA declared and we agree, that:
Counsel, I'm talking of the general funds, collection from the toll fees. Okay. You said,
The prohibition contained in Sec. 85 of PD 1445 (Government Auditing Code) is they go to the general fund. You also said, money from the general fund can be spent
explicit and mandatory. Fund availability is, as it has always been, an indispensable only if there is an appropriation law by Congress.
prerequisite to the execution of any government contract involving the expenditure of
public funds by all government agencies at all levels. Such contracts are not to be DEAN AGABIN:
considered as final or binding unless such a certification as to funds availability is
Yes, Your Honor.
issued (Letter of Instruction No. 767, s. 1978). Antecedent of advance appropriation is
thus essential to government liability on contracts (Zobel vs. City of Manila, 47 Phil. There is no law.
169). This contract being violative of the legal requirements aforequoted, the same
contravenes Sec. 85 of PD 1445 and is null and void by virtue of Sec. 87. DEAN AGABIN:

Verily, the contract, as expressly declared by law, is inexistent and void ab initio. This
is to say that the proposed contract is without force and effect from the very beginning
or from its incipiency, as if it had never been entered into, and hence, cannot be
validated either by lapse of time or ratification. (Emphasis supplied)
Significantly, Radstock’s counsel admits that an appropriation law is needed before
PNCC can use toll fees to pay Radstock, thus:
Yes, except that, Your Honor, this fund has not yet gone to the general fund.
ASSOCIATE JUSTICE CARPIO:
No. It’s being collected everyday. As of May 7, 2007, national government owned
those assets already. All those x x x collections that would have gone to PNCC are
now national government owned. It goes to the general fund. And any body who uses
that without appropriation from Congress commits malversation, I tell you.
81
DEAN AGABIN: ASSOCIATE JUSTICE CARPIO:

That is correct, Your Honor, as long as it has already gone into the general fund. If there is some portion that xxx may be [for] operating expenses of PNCC. But that is
not
ASSOCIATE JUSTICE CARPIO:
DEAN AGABIN:
Oh, you mean to say that it’s still being held now by the agent, PNCC. It has not been
remitted to the National Government? Even profit, Your Honor.

DEAN AGABIN: ASSOCIATE JUSTICE CARPIO:

Well, if PNCC (interrupted) Yeah, but that is not the six percent. Out of the six percent, that goes now to PNCC,
that’s entirely national government. But the National Government and the PNCC can
ASSOCIATE JUSTICE CARPIO: agree on service fees for collecting, to pay toll collectors.
But if (interrupted) DEAN AGABIN:
DEAN AGABIN: Yes, Your Honor.
If this is the share that properly belongs to PNCC as a private entity (interrupted) ASSOCIATE JUSTICE CARPIO:
ASSOCIATE JUSTICE CARPIO: But those are expenses. We are talking of the net income. It goes to the general fund.
No, no. I am saying that – You just agreed that all those collections now will go to the And it’s only Congress that can authorize that expenditure. Not even the Court of
National Government forming part of the general fund. If, somehow, PNCC is holding Appeals can give its stamp of approval that it goes to Radstock, correct?
this money in the meantime, it holds xxx it in trust, correct? Because you said, it goes DEAN AGABIN:
to the general fund, National Government. So it must be holding this in trust for the
National Government. Yes, Your Honor.69 (Emphasis supplied)

DEAN AGABIN: Without an appropriation law, the use of the toll fees to pay Radstock would constitute
malversation of public funds. Even counsel for Radstock expressly admits that the use
Yes, Your Honor. of the toll fees to pay Radstock constitutes malversation of public funds, thus:
ASSOCIATE JUSTICE CARPIO: ASSOCIATE JUSTICE CARPIO:
Okay. Can the person holding in trust use it to pay his private debt? x x x As of May 7, 2007, [the] national government owned those assets already. All
DEAN AGABIN: those x x x collections that would have gone to PNCC are now national government
owned. It goes to the general fund. And any body who uses that without appropriation
No, Your Honor. from Congress commits malversation, I tell you.
ASSOCIATE JUSTICE CARPIO: DEAN AGABIN:
Cannot be. That is correct, Your Honor, as long as it has already gone into the general fund.
DEAN AGABIN: ASSOCIATE JUSTICE CARPIO:
But I assume that there must be some portion of the collections which properly pertain Oh, you mean to say that it’s still being held now by the agent, PNCC. It has not been
to PNCC. remitted to the National Government?

82
DEAN AGABIN: became the majority stockholder of PNCC only because government financial
institutions converted their loans to PNCC into equity when PNCC failed to pay the
Well, if PNCC (interrupted) loans. However, CDCP Mining have always remained a majority privately owned
ASSOCIATE JUSTICE CARPIO: corporation with PNCC owning only 13% of its equity as admitted by former PNCC
Chairman Arthur N. Aguilar and PNCC SVP Finance Miriam M. Pasetes during the
But if (interrupted) Senate hearings, thus:
DEAN AGABIN: SEN. OSMEÑA. x x x – I just wanted to know is CDCP Mining a 100 percent
subsidiary of PNCC?
If this is the share that properly belongs to PNCC as a private entity (interrupted)
MR. AGUILAR. Hindi ho. Ah, no.
ASSOCIATE JUSTICE CARPIO:
SEN. OSMEÑA. If they’re not a 100 percent, why would they sign jointly and
No, no. I am saying that – You just agreed that all those collections now will go to the
severally? I just want to plug the loopholes.
National Government forming part of the general fund. If, somehow, PNCC is holding
this money in the meantime, it holds x x x it in trust, correct? Because you said, it goes MR. AGUILAR. I think it was – if I may just speculate. It was just common ownership
to the general fund, National Government. So it must be holding this in trust for the at that time.
National Government.
SEN. OSMEÑA. Al right. Now – Also, the ...
DEAN AGABIN:
MR. AGUILAR. Ah, 13 percent daw, your Honor.
Yes, Your Honor.70 (Emphasis supplied)
SEN. OSMEÑA. Huh?
Indisputably, funds held in trust by PNCC for the National Government cannot
be used by PNCC to pay a private debt of CDCP Mining to Radstock, otherwise MR. AGUILAR. Thirteen percent ho.
the PNCC Board will be liable for malversation of public funds. SEN. OSMEÑA. What’s 13 percent?
In addition, to pay Radstock ₱6.185 billion violates the fundamental public policy, MR. AGUILAR. We owned ...
expressly articulated in Section 4(2) of the Government Auditing Code, 71 that
government funds or property shall be spent or used solely for pubic purposes, thus: MS. PASETES. Thirteen percent of ...

Section 4. Fundamental Principles. x x x (2) Government funds or property shall be SEN. OSMEÑA. PNCC owned ...
spent or used solely for public purposes. (Emphasis supplied)
MS. PASETES. (Mike off) CDCP ...
There is no question that the subject of the Compromise Agreement is CDCP Mining’s
private debt to Marubeni, which Marubeni subsequently assigned to Radstock. Counsel SEN. DRILON. Use the microphone, please.
for Radstock admits that Radstock holds a private debt of CDCP Mining, thus: MS. PASETES. Sorry. Your Honor, the ownership of CDCP of CDCP Basay
ASSOCIATE JUSTICE CARPIO: Mining ...

So your client is holding a private debt of CDCP Mining, correct? SEN. OSMEÑA. No, no, the ownership of CDCP. CDCP Mining, how many percent
of the equity of CDCP Mining was owned by PNCC, formerly CDCP?
DEAN AGABIN:
MS. PASETES. Thirteen percent.
Correct, Your Honor.72 (Emphasis supplied)
SEN. OSMEÑA. Thirteen. And as a 13 percent owner, they agreed to sign jointly and
CDCP Mining obtained the Marubeni loans when CDCP Mining and PNCC (then severally?
CDCP) were still privately owned and managed corporations. The Government
83
MS. PASETES. Yes. xxxx

SEN. OSMEÑA. One-three?
So poor PNCC and CDCP got taken to the cleaners here. They sign for a 100 percent
and they only own 13 percent.
x x x x73 (Emphasis supplied)
PNCC cannot use public funds, like toll fees that indisputably form part of the General
Fund, to pay a private debt of CDCP Mining to Radstock. Such payment cannot
qualify as expenditure for a public purpose. The toll fees are merely held in trust by
PNCC for the National Government, which is the owner of the toll fees.
Section 7. Save in cases of hereditary succession, no private lands shall be transferred
or conveyed except to individuals, corporations, or associations qualified to acquire or
hold lands of the public domain.
The OGCC admits that Radstock cannot own lands in the Philippines. However, the
OGCC claims that Radstock can own the rights to ownership of lands in the
Philippines, thus:
ASSOCIATE JUSTICE CARPIO:
Under the law, a foreigner cannot own land, correct?

Considering that there is no appropriation law passed by Congress for the ₱6.185 ATTY. AGRA:
billion compromise amount, the Compromise Agreement is void for being contrary to
law, specifically Section 29(1), Article VI of the Constitution and Section 87 of PD Yes, Your Honor.
1445. And since the payment of the ₱6.185 billion pertains to CDCP Mining’s private ASSOCIATE JUSTICE CARPIO:
debt to Radstock, the Compromise Agreement is also void for being contrary to the
fundamental public policy that government funds or property shall be spent or used Can a foreigner who xxx cannot own land assign the right of ownership to the land?
solely for public purposes, as provided in Section 4(2) of the Government Auditing
ATTY. AGRA:
Code.
Again, Your Honor, at that particular time, it will be PNCC, not through Radstock, that
C. Radstock is not qualified to own land in the Philippines.
chain of events should be, there’s a qualified nominee (interrupted)
Radstock is a private corporation incorporated in the British Virgin Islands. Its office
ASSOCIATE JUSTICE CARPIO:
address is at Suite 14021 Duddell Street, Central Hongkong. As a foreign corporation,
with unknown owners whose nationalities are also unknown, Radstock is not qualified Yes, xxx you said, Radstock will assign the right of ownership to the qualified
to own land in the Philippines pursuant to Section 7, in relation to Section 3, Article assignee[.] So my question is, can a foreigner own the right to ownership of a land
XII of the Constitution. These provisions state: when it cannot own the land itself?
Section. 3. Lands of the public domain are classified into agricultural, forest or timber, ATTY. AGRA:
mineral lands, and national parks. Agricultural lands of the public domain may be
further classified by law according to the uses to which they may be devoted. The foreigner cannot own the land, Your Honor.
Alienable lands of the public domain shall be limited to agricultural lands. Private
ASSOCIATE JUSTICE CARPIO:
corporations or associations may not hold such lands of the public domain except by
lease, for a period not exceeding twenty-five years, renewable for not more than But you are saying it can own the right of ownership to the land, because you are
twenty-five years, and not to exceed one hundred thousand hectares in area. Citizens of saying, the right of ownership will be assigned by Radstock.
the Philippines may lease not more than five hundred hectares, or acquire not more
than twelve hectares thereof by purchase, homestead, or grant. ATTY. AGRA:

Taking into account the requirements of conservation, ecology, and development, and The rights over the properties, Your Honors, if there’s a valid assignment made to a
subject to the requirements of agrarian reform, the Congress shall determine, by law, qualified party, then the assignment will be made.
the size of lands of the public domain which may be acquired, developed, held, or
ASSOCIATE JUSTICE CARPIO:
leased and the conditions therefor.
Who makes the assignment?
84
ATTY. AGRA: ATTY. AGRA:

It will be Radstock, Your Honor. Not directly, Your Honors. Again, there must be a qualified nominee assigned by
Radstock.
ASSOCIATE JUSTICE CARPIO:
ASSOCIATE JUSTICE CARPIO:
So, if Radstock makes the assignment, it must own its rights, otherwise, it cannot
assign it, correct? It’s very clear, it’s an indirect way of selling property that is prohibited by law, is it
not?
ATTY. AGRA:
ATTY. AGRA:
Pursuant to the compromise agreement, once approved, yes, Your Honors.
Again, Your Honor, know, believe this is a Compromise Agreement. This is a dacion
ASSOCIATE JUSTICE CARPIO: en pago.
So, you are saying that Radstock can own the rights to ownership of the land? ASSOCIATE JUSTICE CARPIO:
ATTY. AGRA: So, dacion en pago is an exception to the constitutional prohibition.
Yes, Your Honors. ATTY. AGRA:
ASSOCIATE JUSTICE CARPIO: No, Your Honor. PNCC, will still hold on to the property, absent a valid assignment of
Yes? properties.

ATTY. AGRA: ASSOCIATE JUSTICE CARPIO:

The premise, Your Honor, you mentioned a while ago was, if this Court approves said But what rights will PNCC have over that land when it has already signed the
compromise (interrupted) compromise? It is just waiting for instruction xxx from Radstock what to do with it?
So, it’s a trustee of somebody, because it does not, it cannot, [it] has no dominion over
ASSOCIATE JUSTICE CARPIO: it anymore? It’s just holding it for Radstock. So, PNCC becomes a dummy, at that
point, of Radstock, correct?
No, no. Whether there is such a compromise agreement - - It’s an academic question I
am asking you, can a foreigner assign rights to ownership of a land in the Philippines? ATTY. AGRA:
ATTY. AGRA: No, Your Honor, I believe it (interrupted)
Under the Compromise Agreement, Your Honors, these rights should be respected. ASSOCIATE JUSTICE CARPIO:
ASSOCIATE JUSTICE CARPIO: Yeah, but it does not own the land, but it still holding the land in favor of the other
party to the Compromise Agreement
So, it can?
ATTY. AGRA:
ATTY. AGRA:
Pursuant to the compromise agreement, that will happen.
It can. Your Honor. But again, this right must, cannot be perfected or cannot be, could
not take effect. ASSOCIATE JUSTICE CARPIO:
ASSOCIATE JUSTICE CARPIO: Okay. May I (interrupted)
But if it cannot - - It’s not perfected, how can it assign? ATTY. AGRA:
85
Again, Your Honor, if the compromise agreement ended with a statement that
Radstock will be the owner of the property (interrupted)
ASSOCIATE JUSTICE CARPIO:
Yeah. Unfortunately, it says, to a qualified assignee.
ATTY. AGRA:
Yes, Your Honor.
ASSOCIATE JUSTICE CARPIO:
And at this point, when it is signed and execut[ed] and approved, PNCC has no
dominion over that land anymore. Who has dominion over it?
ATTY. AGRA:
Pending the assignment to a qualified party, Your Honor, PNCC will hold on to the
property.
ASSOCIATE JUSTICE CARPIO:
Hold on, but who x x x can exercise acts of dominion, to sell it, to lease it?
ATTY. AGRA:
Again, Your Honor, without the valid assignment to a qualified nominee, the
compromise agreement in so far as the transfer of these properties will not become
effective. It is subject to such condition. Your Honor.74 (Emphasis supplied)
There is no dispute that Radstock is disqualified to own lands in the Philippines.
Consequently, Radstock is also disqualified to own the rights to ownership of lands in
the Philippines. Contrary to the OGCC’s claim, Radstock cannot own the rights to
ownership of any land in the Philippines because Radstock cannot lawfully own the
land itself. Otherwise, there will be a blatant circumvention of the Constitution, which
prohibits a foreign private corporation from owning land in the Philippines. In
addition, Radstock cannot transfer the rights to ownership of land in the Philippines if
it cannot own the land itself. It is basic that an assignor or seller cannot assign or sell
something he does not own at the time the ownership, or the rights to the ownership,
are to be transferred to the assignee or buyer.75
The third party assignee under the Compromise Agreement who will be designated by
Radstock can only acquire rights duplicating those which its assignor (Radstock) is
entitled by law to exercise.76 Thus, the assignee can acquire ownership of the land only
if its assignor, Radstock, owns the land. Clearly, the assignment by PNCC of the real
properties to a nominee to be designated by Radstock is a circumvention of the
Constitutional prohibition against a private foreign corporation owning lands in the
Philippines. Such circumvention renders the Compromise Agreement void.
D. Public bidding is required for
the disposal of government properties.
Under Section 79 of the Government Auditing Code,77 the disposition
of government lands to private parties requires public bidding. 78 COA Circular No. 89-
926, issued on 27 January 1989, sets forth the guidelines on the disposal of property
and other assets of the government. Part V of the COA Circular provides:
V. MODE OF DISPOSAL/DIVESTMENT: -
This Commission recognizes the following modes of disposal/divestment of assets and
property of national government agencies, local government units and government-
owned or controlled corporations and their subsidiaries, aside from other such modes
as may be provided for by law.
1. Public Auction
Conformably to existing state policy, the divestment or disposal of government
property as contemplated herein shall be undertaken primarily thru public auction.
Such mode of divestment or disposal shall observe and adhere to established
mechanics and procedures in public bidding, viz:
a. adequate publicity and notification so as to attract the greatest number of interested
parties; (vide, Sec. 79, P.D. 1445)
b. sufficient time frame between publication and date of auction;
c. opportunity afforded to interested parties to inspect the property or assets to be
disposed of;
d. confidentiality of sealed proposals;
e. bond and other prequalification requirements to guarantee performance; and
f. fair evaluation of tenders and proper notification of award.
It is understood that the Government reserves the right to reject any or all of the
tenders. (Emphasis supplied)
Under the Compromise Agreement, PNCC shall dispose of substantial parcels of land,
by way of dacion en pago, in favor of Radstock. Citing Uy v. Sandiganbayan, 79 PNCC
argues that a dacion en pago is an exception to the requirement of a public bidding.
86
PNCC’s reliance on Uy is misplaced. There is nothing in Uy declaring that public
bidding is dispensed with in a dacion en pago transaction. The Court explained the
transaction in Uy as follows:
We do not see any infirmity in either the MOA or the SSA executed between
PIEDRAS and respondent banks. By virtue of its shareholdings in OPMC, PIEDRAS
was entitled to subscribe to 3,749,906,250 class "A" and 2,499,937,500 class "B"
OPMC shares. Admittedly, it was financially sound for PIEDRAS to exercise its pre-
emptive rights as an existing shareholder of OPMC lest its proportionate shareholdings
be diluted to its detriment. However, PIEDRAS lacked the necessary funds to pay for
the additional subscription. Thus, it resorted to contract loans from respondent banks to
finance the payment of its additional subscription. The mode of payment agreed upon
by the parties was that the payment would be made in the form of part of the shares
subscribed to by PIEDRAS. The OPMC shares therefore were agreed upon by the
parties to be equivalent payment for the amount advanced by respondent banks. We
see the wisdom in the conditions of the loan transaction. In order to save PIEDRAS
and/or the government from the trouble of selling the shares in order to raise funds to
pay off the loans, an easier and more direct way was devised in the form of the dacion
en pago agreements.
Moreover, we agree with the Sandiganbayan that neither PIEDRAS nor the
government sustained any loss in these transactions. In fact, after deducting the shares
to be given to respondent banks as payment for the shares, PIEDRAS stood to gain
about 1,540,781,554 class "A" and 710,550,000 class "B" OPMC shares virtually for
free. Indeed, the question that must be asked is whether or not PIEDRAS, in the
exercise of its pre-emptive rights, would have been able to acquire any of these shares
at all if it did not enter into the financing agreements with the respondent banks. 80
Suffice it to state that in Uy, neither PIEDRAS 81 nor the government suffered any loss
in the dacion en pago transactions, unlike here where the government stands to lose at
least ₱6.185 billion worth of assets.
Besides, a dacion en pago is in essence a form of sale, which basically involves a
disposition of a property. In Filinvest Credit Corp. v. Philippine Acetylene, Co.,
Inc.,82 the Court defined dacion en pago in this wise:
Dacion en pago, according to Manresa, is the transmission of the ownership of a thing
by the debtor to the creditor as an accepted equivalent of the performance of
obligation. In dacion en pago, as a special mode of payment, the debtor offers another
thing to the creditor who accepts it as equivalent of payment of an outstanding debt.
The undertaking really partakes in one sense of the nature of sale, that is, the creditor is
really buying the thing or property of the debtor, payment for which is to be charged
against the debtor's debt.As such, the essential elements of a contract of sale, namely,
consent, object certain, and cause or consideration must be present. In its modern
concept, what actually takes place in dacion en pago is an objective novation of the
obligation where the thing offered as an accepted equivalent of the performance of an
obligation is considered as the object of the contract of sale, while the debt is
considered as the purchase price. In any case, common consent is an essential
prerequisite, be it sale or innovation to have the effect of totally extinguishing the debt
or obligation.83 (Emphasis supplied)
E. PNCC must follow rules on preference of credit.
Radstock is only one of the creditors of PNCC. Asiavest is PNCC’s judgment creditor.
In its Board Resolution No. BD-092-2000, PNCC admitted not only its debt to
Marubeni but also its debt to the National Government 84 in the amount of ₱36
billion.85 During the Senate hearings, PNCC admitted that it owed the Government
₱36 billion, thus:
SEN. OSMEÑA. All right. Now, second question is, the management of PNCC also
recognize the obligation to the national government of 36 billion. It is part of the board
resolution.
MS. OGAN. Yes, sir, it is part of the October 20 board resolution.
SEN. OSMEÑA. All right. So if you owe the national government 36 billion and you
owe Marubeni 10 billion, you know, I would just declare bankruptcy and let an orderly
disposition of assets be done. What happened in this case to the claim, the 36 billion
claim of the national government? How was that disposed of by the PNCC? Mas
malaki ang utang ninyo sa national government, 36 billion. Ang gagawin ninyo,
babayaran lahat ang utang ninyo sa Marubeni without any assets left to satisfy your
obligations to the national government. There should have been, at least, a pari passu
payment of all your obligations, 'di ba?
MS. PASETES. Mr. Chairman...
SEN. OSMEÑA. Yes.
MS. PASETES. PNCC still carries in its books an equity account called equity
adjustments arising from transfer of obligations to national government - - 5.4 billion -
- in addition to shares held by government amounting to 1.2 billion.
SEN. OSMEÑA. What is the 36 billion?
THE CHAIRMAN. Ms. Pasetes...
SEN. OSMEÑA. Wait, wait, wait.
THE CHAIRMAN. Baka ampaw yun eh.
87
SEN. OSMEÑA. Teka muna. What is the 36 billion that appear in the resolution of the
board in September 2000 (sic)? This is the same resolution that recognizes,
acknowledges and confirms PNCC's obligations to Marubeni. And subparagraph (a)
says "Government of the Philippines, in the amount of 36,023,784,000 and change.
And then (b) Marubeni Corporation in the amount of 10,743,000,000. So, therefore, in
the same resolution, you acknowledged that had something like P46.7 billion in
obligations. Why did PNCC settle the 10 billion and did not protect the national
government's 36 billion? And then, number two, why is it now in your books, the 36
billion is now down to five? If you use that ratio, then Marubeni should be down to
one.
MS. PASETES. Sir, the amount of 36 billion is principal plus interest and penalties.
SEN. OSMEÑA. And what about Marubeni? Is that just principal only?
MS. PASETES. Principal and interest.
SEN. OSMEÑA. So, I mean, you know, it's equal treatment. Ten point seven billion is
principal plus penalties plus interest, hindi ba?
MS. PASETES. Yes, sir. Yes, Your Honor.
SEN. OSMEÑA. All right. So now, what you are saying is that you gonna pay
Marubeni 6 billion and change and the national government is only recognizing 5
billion. I don't think that's protecting the interest of the national government at all.86
In giving priority and preference to Radstock, the Compromise Agreement is certainly
in fraud of PNCC’s other creditors, including the National Government, and violates
the provisions of the Civil Code on concurrence and preference of credits.
This Court has held that while the Corporation Code allows the transfer of all or
substantially all of the assets of a corporation, the transfer should not prejudice the
creditors of the assignor corporation. 87 Assuming that PNCC may transfer all or
substantially all its assets, to allow PNCC to do so without the consent of its creditors
or without requiring Radstock to assume PNCC’s debts will defraud the other PNCC
creditors88 since the assignment will place PNCC’s assets beyond the reach of its other
creditors.89 As this Court held in Caltex (Phil.), Inc. v. PNOC Shipping and Transport
Corporation:90
While the Corporation Code allows the transfer of all or substantially all the properties
and assets of a corporation, the transfer should not prejudice the creditors of the
assignor. The only way the transfer can proceed without prejudice to the creditors is to
hold the assignee liable for the obligations of the assignor. The acquisition by the
assignee of all or substantially all of the assets of the assignor necessarily includes the
assumption of the assignor's liabilities, unless the creditors who did not consent to the
transfer choose to rescind the transfer on the ground of fraud. To allow an assignor to
transfer all its business, properties and assets without the consent of its creditors and
without requiring the assignee to assume the assignor's obligations will defraud the
creditors. The assignment will place the assignor's assets beyond the reach of its
creditors. (Emphasis supplied)
Also, the law, specifically Article 138791 of the Civil Code, presumes that there is fraud
of creditors when property is alienated by the debtor after judgment has been rendered
against him, thus:
Alienations by onerous title are also presumed fraudulent when made by persons
against whom some judgment has been rendered in any instance or some writ of
attachment has been issued. The decision or attachment need not refer to the property
alienated, and need not have been obtained by the party seeking rescission. (Emphasis
supplied)
As stated earlier, Asiavest is a judgment creditor of PNCC in G.R. No. 110263 and a
court has already issued a writ of execution in its favor. Thus, when PNCC entered into
the Compromise Agreement conveying several prime lots in favor of Radstock, by way
of dacion en pago, there is a legal presumption that such conveyance is fraudulent
under Article 1387 of the Civil Code. 92 This presumption is strengthened by the fact
that the conveyance has virtually left PNCC’s other creditors, including the biggest
creditor – the National Government - with no other asset to garnish or levy.
Notably, the presumption of fraud or intention to defraud creditors is not just limited to
the two instances set forth in the first and second paragraphs of Article 1387 of the
Civil Code. Under the third paragraph of the same article, "the design to defraud
creditors may be proved in any other manner recognized by the law of evidence." In
Oria v. Mcmicking,93 this Court considered the following instances as badges of
fraud:
1. The fact that the consideration of the conveyance is fictitious or is inadequate.
2. A transfer made by a debtor after suit has begun and while it is pending against him.
3. A sale upon credit by an insolvent debtor.
4. Evidence of large indebtedness or complete insolvency.
5. The transfer of all or nearly all of his property by a debtor, especially when he is
insolvent or greatly embarrassed financially.
6. The fact that the transfer is made between father and son, when there are present
other of the above circumstances.
7. The failure of the vendee to take exclusive possession of all the property. (Emphasis
supplied)
88
Among the circumstances indicating fraud is a transfer of all or nearly all of the
debtor’s assets, especially when the debtor is greatly embarrassed financially.
Accordingly, neither a declaration of insolvency nor the institution of insolvency
proceedings is a condition sine qua non for a transfer of all or nearly all of a debtor’s
assets to be regarded in fraud of creditors. It is sufficient that a debtor is greatly
embarrassed financially.
In this case, PNCC’s huge negative net worth - at least ₱6 billion as expressly admitted
by PNCC’s counsel during the oral arguments, or ₱14 billion based on the 2006 COA
Audit Report - necessarily translates to an extremely embarrassing financial situation.
With its huge negative net worth arising from unpaid billions of pesos in debt, PNCC
cannot claim that it is financially stable. As a consequence, the Compromise
Agreement stipulating a transfer in favor of Radstock of substantially all of PNCC’s
assets constitutes fraud. To legitimize the Compromise Agreement just because there is
still no judicial declaration of PNCC’s insolvency will work fraud on PNCC’s other
creditors, the biggest creditor of which is the National Government. To insist that
PNCC is very much liquid, given its admitted huge negative net worth, is nothing but
denial of the truth. The toll fees that PNCC collects belong to the National
Government. Obviously, PNCC cannot claim it is liquid based on its collection of such
toll fees, because PNCC merely holds such toll fees in trust for the National
Government. PNCC does not own the toll fees, and such toll fees do not form part of
PNCC’s assets.
PNCC owes the National Government ₱36 billion, a substantial part of which
constitutes taxes and fees, thus:
SEN. ROXAS. Thank you, Mr. Chairman.
Mr. PNCC Chairman, could you describe for us the composition of your debt of about
five billion – there are in thousands, so this looks like five and half billion. Current
portion of long-term debt, about five billion. What is this made of?
MS. PASETES. The five billion is composed of what is owed the Bureau of
Treasury and the Toll Regulatory Board for concession fees that’s almost three
billion and another 2.4 billion owed Philippine National Bank.
SEN. ROXAS. So, how much is the Bureau of Treasury?
MS. PASETES. Three billion.
SEN. ROXAS. Three – Why do you owe the Bureau of Treasury three billion?
MS. PASETES. That represents the concession fees due Toll Regulatory Board
principal plus interest, Your Honor.
94
x x x x  (Emphasis supplied)
In addition, PNCC’s 2006 Audit Report by COA states as follows:
TAX MATTERS
The Company was assessed by the Bureau of Internal Revenue (BIR) of its
deficiencies in various taxes. However, no provision for any liability has been made
yet in the Company’s financial statements.
• 1980 deficiency income tax, deficiency contractor’s tax and deficiency documentary
stamp tax assessments by the BIR totaling ₱212.523 Million.
xxxx
• Deficiency business tax of ₱64 Million due the Belgian Consortium, PNCC’s partner
in its LRT Project.
• 1992 deficiency income tax, deficiency value-added tax and deficiency expanded
withholding tax of ₱1.04 Billion which was reduced to ₱709 Million after the
Company’s written protest.
xxxx
• 2002 deficiency internal revenue taxes totaling ₱72.916 Million.
x x x x.95 (Emphasis supplied)
Clearly, PNCC owes the National Government substantial taxes and fees amounting to
billions of pesos.
The ₱36 billion debt to the National Government was acknowledged by the PNCC
Board in the same board resolution that recognized the Marubeni loans. Since PNCC is
clearly insolvent with a huge negative net worth, the government enjoys preference
over Radstock in the satisfaction of PNCC’s liability arising from taxes and duties,
pursuant to the provisions of the Civil Code on concurrence and preference of credits.
Articles 2241,96 224297 and 224398 of the Civil Code expressly mandate that taxes and
fees due the National Government "shall be preferred" and "shall first be satisfied"
over claims like those arising from the Marubeni loans which "shall enjoy no
preference" under Article 2244.99
However, in flagrant violation of the Civil Code, the PNCC Board favored Radstock
over the National Government in the order of credits. This would strip PNCC of its
assets leaving virtually nothing for the National Government. This action of the PNCC
Board is manifestly and grossly disadvantageous to the National Government and
amounts to fraud.
During the Senate hearings, Senator Osmeña pointed out that in the Board Resolution
of 20 October 2000, PNCC acknowledged its obligations to the National Government
89
amounting to ₱36,023,784,000 and to Marubeni amounting to ₱10,743,000,000. Yet,
Senator Osmeña noted that in the PNCC books at the time of the hearing, the ₱36
billion obligation to the National Government was reduced to ₱5 billion. PNCC’s
Miriam M. Pasetes could not properly explain this discrepancy, except by stating that
the ₱36 billion includes the principal plus interest and penalties, thus:
SEN. OSMEÑA. Teka muna. What is the 36 billion that appear in the resolution of the
board in September 2000 (sic)? This is the same resolution that recognizes,
acknowledges and confirms PNCC's obligations to Marubeni. And subparagraph (a)
says "Government of the Philippines, in the amount of 36,023,784,000 and change.
And then (b) Marubeni Corporation in the amount of 10,743,000,000. So, therefore, in
the same resolution, you acknowledged that had something like P46.7 billion in
obligations. Why did PNCC settle the 10 billion and did not protect the national
government's 36 billion? And then, number two, why is it now in your books, the 36
billion is now down to five? If you use that ratio, then Marubeni should be down to
one.
MS. PASETES. Sir, the amount of 36 billion is principal plus interest and penalties.
SEN. OSMEÑA. And what about Marubeni? Is that just principal only?
MS. PASETES. Principal and interest.
SEN. OSMEÑA. So, I mean, you know, it's equal treatment. Ten point seven billion is
principal plus penalties plus interest, hindi ba?
MS. PASETES. Yes, sir. Yes, Your Honor.
SEN. OSMEÑA. All right. So now, what you are saying is that you gonna pay
Marubeni 6 billion and change and the national government is only recognizing 5
billion. I don't think that's protecting the interest of the national government at all.100
PNCC failed to explain satisfactorily why in its books the obligation to the National
Government was reduced when no payment to the National Government appeared to
have been made. PNCC failed to justify why it made it appear that the obligation to the
National Government was less than the obligation to Marubeni. It is another obvious
ploy to justify the preferential treatment given to Radstock to the great prejudice of the
National Government.
VI.
Supreme Court is Not Legitimizer of Violations of Laws
During the oral arguments, counsels for Radstock and PNCC admitted that the
Compromise Agreement violates the Constitution and existing laws. However, they
rely on this Court to approve the Compromise Agreement to shield their clients from
possible criminal acts arising from violation of the Constitution and existing laws. In
their view, once this Court approves the Compromise Agreement, their clients are
home free from prosecution, and can enjoy the ₱6.185 billion loot. The following
exchanges during the oral arguments reveal this view:
ASSOCIATE JUSTICE CARPIO:
If there is no agreement, they better remit all of that to the National Government. They
cannot just hold that. They are holding that [in] trust, as you said, x x x you agree, for
the National Government.
DEAN AGABIN:
Yes, that’s why, they are asking the Honorable Court to approve the compromise
agreement.
ASSOCIATE JUSTICE CARPIO:
We cannot approve that if the power to authorize the expenditure [belongs] to
Congress. How can we usurp x x x the power of Congress to authorize that
expenditure[?] It’s only Congress that can authorize the expenditure of funds
from the general funds.
DEAN AGABIN:
But, Your Honor, if the Honorable Court would approve of this compromise
agreement, I believe that this would be binding on Congress.
ASSOCIATE JUSTICE CARPIO:
Ignore the Constitutional provision that money shall be paid out of the National
Treasury only pursuant to an appropriation by law. You want us to ignore that[?]
DEAN AGABIN:
Not really, Your Honor, but I suppose that Congress would have no choice, because
this is a final judgment of the Honorable Court. 101
xxxx
ASSOCIATE JUSTICE CARPIO:
So, if Radstock makes the assignment, it must own its rights, otherwise, it cannot
assign it, correct?
ATTY. AGRA:
Pursuant to the compromise agreement, once approved, yes, Your Honors.
ASSOCIATE JUSTICE CARPIO:
90
So, you are saying that Radstock can own the rights to ownership of the land?
ATTY. AGRA:
Yes, Your Honors.
ASSOCIATE JUSTICE CARPIO:
Yes?
ATTY. AGRA:
The premise, Your Honor, you mentioned a while ago was, if this Court approves said
compromise (interrupted).102 (Emphasis supplied)
This Court is not, and should never be, a rubber stamp for litigants hankering to pocket
public funds for their selfish private gain. This Court is the ultimate guardian of the
public interest, the last bulwark against those who seek to plunder the public coffers.
This Court cannot, and must never, bring itself down to the level of legitimizer of
violations of the Constitution, existing laws or public policy.
Conclusion
In sum, the acts of the PNCC Board in (1) issuing Board Resolution Nos. BD-092-
2000 and BD-099-2000 expressly admitting liability for the Marubeni loans, and (2)
entering into the Compromise Agreement, constitute evident bad faith and gross
inexcusable negligence, amounting to fraud, in the management of PNCC’s affairs.
Being public officers, the government nominees in the PNCC Board must answer not
only to PNCC and its stockholders, but also to the Filipino people for grossly
mishandling PNCC’s finances.
Under Article 1409 of the Civil Code, the Compromise Agreement is "inexistent and
void from the beginning," and "cannot be ratified," thus:
Art. 1409. The following contracts are inexistent and void from the beginning:
(1) Those whose cause, object or purpose is contrary to law, morals, good customs,
public order or public policy;
xxx
(7) Those expressly prohibited or declared void by law.
These contracts cannot be ratified. x x x. (Emphasis supplied)
The Compromise Agreement is indisputably contrary to the Constitution, existing laws
and public policy. Under Article 1409, the Compromise Agreement is expressly
declared void and "cannot be ratified." No court, not even this Court, can ratify or
approve the Compromise Agreement. This Court must perform its duty to defend and
uphold the Constitution, existing laws, and fundamental public policy. This Court must
not shirk in declaring the Compromise Agreement inexistent and void ab initio.
WHEREFORE, we GRANT the petition in G.R. No. 180428. We SET ASIDE the
Decision dated 25 January 2007 and the Resolutions dated 12 June 2007 and 5
November 2007 of the Court of Appeals. We DECLARE (1) PNCC Board Resolution
Nos. BD-092-2000 and BD-099-2000 admitting liability for the Marubeni loans VOID
AB INITIO for causing undue injury to the Government and giving unwarranted
benefits to a private party, constituting a corrupt practice and unlawful act under
Section 3(e) of the Anti-Graft and Corrupt Practices Act, and (2) the Compromise
Agreement between the Philippine National Construction Corporation and Radstock
Securities Limited INEXISTENT AND VOID AB INITIO for being contrary to
Section 29(1), Article VI and Sections 3 and 7, Article XII of the Constitution; Section
20(1), Chapter IV, Subtitle B, Title I, Book V of the Administrative Code of 1987;
Sections 4(2), 79, 84(1), and 85 of the Government Auditing Code; and Articles 2241,
2242, 2243 and 2244 of the Civil Code.
We GRANT the intervention of Asiavest Merchant Bankers Berhad in G.R. No.
178158 but DECLARE that Strategic Alliance Development Corporation has no legal
standing to sue.
SO ORDERED.
Notes.—There was no error nor grave abuse of discretion committed by the
Sandiganbayan in ruling that the execution of the Compromise Agreement was tainted
with fraud on the part of the private parties and in connivance with some PCGG
officials—fraud was perpetuated upon the Republic as the assessed or market values of
the properties offered for settlement had been concealed from the reviewing authorities
such as the PCGG En Banc and even the President of the Republic. (Argana vs.
Republic, 443 SCRA 184 [2004])
The right to travel does not mean the right to choose any vehicle in traversing a toll
way. (Mirasol vs. Department of Public Works and Highways, 490 SCRA 318 [2006])
Cases of unexplained wealth are similar to cases of bribery or dereliction of duty and
no reason why these two classes of cases cannot be excepted from the rule making
bank deposits confidential—and, undoubtedly, cases for plunder involve unexplained
wealth. (Ejercito vs. Sandiganbayan [Special Division], 509 SCRA 190 [2006])
Strategic Alliance Development Corporation vs. Radstock Securities Limited, 607
SCRA 413, G.R. No. 178158 December 4, 2009
91

G.R. No. 130656. June 29, 2000.
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. ARMANDO
REANZARES ** also known as ARMANDO RIANZARES, accused-appellant.
Alibi; Requisites.—These attempts of the accused to discredit Gregorio obviously
cannot hold ground. Neither can they bolster his alibi. For alibi to be believed it must
be shown that (a) the accused was in another place at the time of the commission of the
offense, and (b) it was physically impossible for him to be at the crime scene.
Criminal Law; Highway Robbery; Conviction for highway robbery requires proof that
several accused were organized for the purpose of committing it indiscriminately.—
Indeed the accused is guilty. But that the accused was guilty of Highway Robbery with
Homicide under PD 532 was erroneous. As held in a number of cases, conviction for
highway robbery requires proof that several accused were organized for the purpose of
committing it indiscriminately. There is no proof in the instant case that the accused
and his cohorts organized themselves to commit highway robbery. Neither is there
proof that they attempted to commit similar robberies to show the “indiscriminate”
perpetration thereof. On the other hand, what the prosecution established was only a
single act of robbery against the particular persons of the Tactacan spouses. Clearly,
this single act of depredation is not what is contemplated under PD 532 as its objective
is to deter and punish lawless elements who commit acts of depredation upon persons
and properties of innocent and defenseless inhabitants who travel from one place to
another thereby disturbing the peace and tranquility of the nation and stunting the
economic and social progress of the people.
Criminal Procedure; Informations; In the interpretation of an information, what
controls is the description of the offense charged and not merely its designation.—The
accused should be held liable for the special complex crime of robbery with homicide
under Art.294 of the Revised Penal Code as amended by RA 7659 as the allegations in
the Information are enough to convict him therefor. In the interpretation of an
information, what controls is the description of the offense charged and not merely its
designation.
Witnesses; Damages; Judicial Notice; An ordinary witness cannot establish the value
of jewelry and the trial court can only take judicial notice of the value of goods which
is a matter of public knowledge or is capable of unquestionable demonstration.—The
amount of P2,500.00 as reimbursement for the Seiko wristwatch taken from Gregorio
Tactacan must be deleted in the absence of receipts or any other competent evidence
aside from the self-serving valuation made by the prosecution. An ordinary witness
cannot establish the value of jewelry and the trial court can only take judicial notice of
the value of goods which is a matter of public knowledge or is capable of
unquestionable demonstration. The value of jewelry therefore does not fall under either
category of which the court can take judicial notice. People vs. Reanzares, 334 SCRA
624, G.R. No. 130656 June 29, 2000
This case is with us on automatic review of the 26 May 1997 Decision 1 of the Regional
Trial Court of Tanauan, Batangas, finding accused ARMANDO REANZARES also
known as "Armando Rianzares" guilty of Highway Robbery with Homicide under PD
5322 and sentencing him to the extreme penalty of death. He was also ordered to pay
the heirs of his victim Lilia Tactacan P172,000.00 for funeral, burial and related
expenses, P50,000.00 as indemnity for death, P1,000.00 for the cash taken from her
bag, and to reimburse Gregorio Tactacan P2,500.00 for the Seiko wristwatch taken
from him.
92
The facts, except as to the identity of accused Armando Reanzares, are undisputed.
Spouses Gregorio Tactacan and Lilia Tactacan owned a sari-sari store in San Miguel,
Sto. Tomas, Batangas. On 10 May 1994 at around 8:10 in the evening, the Tactacan
spouses closed their store and left for home in Barangay San Roque, Sto. Tomas,
Batangas on board their passenger-type jeepney. As Gregorio was maneuvering his
jeep backwards from where it was parked two (2) unidentified men suddenly climbed
on board. His wife Lilia immediately asked them where they were going and they
answered that they were bound for the town proper. When Lilia informed them that
they were not going to pass through the town proper, the two (2) said they would just
get off at the nearest intersection. After negotiating some 500 meters, one of the
hitchhikers pointed a .38 caliber revolver at Gregorio while the other poked
a balisong at Lilia's neck and ordered Gregorio to stop the vehicle. Two (2) other
persons, one of whom was later identified as accused Armando Reanzares, were seen
waiting for them at a distance. As soon as the vehicle stopped, the accused and his
companion approached the vehicle. Gregorio was then pulled from the driver's seat to
the back of the vehicle. They gagged and blindfolded him and tied his hands and feet.
They also took his Seiko wristwatch worth P2,500.00. The accused then drove the
vehicle after being told by one of them, "Sige i-drive mo na."3
Gregorio did not know where they were headed for as he was blindfolded. After
several minutes, he felt the vehicle making a u-turn and stopped after ten (10) minutes.
During the entire trip, his wife kept uttering, "Maawa kayo sa amin, marami kaming
anak, kunin nyo na lahat ng gusto ninyo." Immediately after the last time she uttered
these words a commotion ensued and Lilia was heard saying, "aray!" Gregorio heard
her but could not do anything. After three (3) minutes the commotion ceased. Then he
heard someone tell him, "Huwag kang kikilos diyan, ha," and left. Gregorio then
untied his hands and feet, removed his gag and blindfold and jumped out of the
vehicle. The culprits were all gone, including his wife. He ran to San Roque East
shouting for help.4
When Gregorio returned to the crime scene, the jeepney was still there. He went to the
drivers seat. There he saw his wife lying on the floor of the jeepney with blood
splattered all over her body. Her bag containing P1,200.00 was missing. He brought
her immediately to the C. P. Reyes Hospital where she was pronounced dead on
arrival.5
At the time of her death Lilia Tactacan was forty-eight (48) years old. According to
Gregorio, he was deeply depressed by her death; that he incurred funeral, burial and
other related expenses, and that his wife was earning P3,430.00 a month as a teacher.6
Dr. Lily D. Nunes, Medical Health Officer of Sto. Tomas, Batangas, conducted a post-
mortem examination on the body of the victim. Her medieport disclosed that the victim
sustained eight (8) stab wounds on the chest and abdominal region of the body. She
testified that a sharp pointed object like a long knife could have caused those wounds
which must have been inflicted by more than one (1) person, and that all those wounds
except the non-penetrating one caused the immediate death of the victim.7
Subsequently, two (2) Informations were filed against accused Armando Reanzares
and three (3) John Does in relation to the incident. The first was for violation of PD
532 otherwise known as the Anti-Piracy and Anti-Highway Robbery Law of 1974 for
allegedly conspiring, with intent to gain and armed with bladed weapons and a .38
caliber revolver, to rob and carry away one (1) Seiko wristwatch owned by Gregorio
Tactacan and P1,000.00 cash of Lilia Tactacan, and on the occasion thereof, killed her.
The second was for violation of RA 6539, An Act Preventing and Penalizing
Carnapping, for taking away by means of violence and intimidation of persons one (1)
passenger-type jeepney with Plate No. DBP 235 owned and driven by Gregorio
Tactacan and valued at P110,000.00. Only the accused Armando Reanzares was
arrested. The other three (3) have remained unidentified and at large.
The accused testified in his defense and claimed that he could not have perpetrated the
crimes imputed to him with three (3) others as he was in Barangay Tagnipa,
Garchitorena, Camarines Sur, for the baptism of his daughter Jessica when the incident
happened.8 His father, Jose Reanzares, corroborated his story. Jose claimed that the
accused borrowed P500.00 from him for the latter's trip to Bicol although he could not
say that he actually saw the accused leave for his intended destination. 9 To bolster the
alibi of the accused, his brother Romeo Reanzares also took the witness stand and
alleged that he saw the accused off on 9 May 1994, the day before the incident. Romeo
maintained that he accompanied the accused to the bus stop that day and even helped
the latter carry his things to the bus. He however could not categorically state where
and when the accused alighted or that he in fact reached Bicol.10
On 26 May 1997 the trial court found the prosecutions evidence credible and ruled that
the alibi of the accused could not prevail over his positive identification by
complaining witness Gregorio Tactacan. The court a quo declared him guilty of
Highway Robbery with Homicide under PD 532 and sentenced him to death. It further
ordered him to pay the heirs of Lilia Tactacan P50,000.00 as indemnity for
death, P172,000.00 for funeral, burial and related expenses, and P1,000.00 for the cash
taken from her bag. The accused was also ordered to reimburse Gregorio
Tactacan P2,500.00 for the Seiko wristwatch taken from him.11 But the trial court
exonerated the accused from the charge of carnapping under RA 6539 for insufficiency
of evidence.
The accused insists before us that his conviction for Highway Robbery with Homicide
under PD 532 is erroneous as his guilt was not proved beyond reasonable doubt. He
claims that the testimony of private complainant Gregorio Tactacan, who implicated
him as one of the perpetrators of the crime, is incredible. He maintains that Gregorio
failed to identify him because when the latter was questioned he stated that he did not
know any of the culprits. He also claims that in the publication of Hotline by Tony
93
Calvento in People's Tonight, Gregorio even asked the readers to help him identify the
malefactors.
The trial court observed that Gregorio Tactacan testified in a categorical,
straightforward, spontaneous and frank manner, and was consistent on cross-
examination. Indeed, Gregorio might not have immediately revealed the name of
accused Armando Reanzares to the police authorities when he was first investigated
but the delay was not an indication of a fabricated charge and should not undermine his
credibility considering that he satisfactorily explained his reasons therefor. According
to him, he did not immediately tell the police about the accused because he feared for
the safety of his family as his neighbors told him that they saw some people lurking
around his house on the day of the incident. Moreover, he was advised not to mention
any names until after the burial of his wife. No ill motive could be attributed to him for
implicating the accused. If at all, the fact that his wife died by reason of the incident
even lends credence to his testimony since his natural interest in securing the
conviction of the guilty would deter him from implicating persons other than the real
culprits, otherwise, those responsible for the perpetration of the crime would escape
prosecution.
To further undermine the credibility of Gregorio, the accused underscores Gregorio's
refusal to be subjected to a lie detector test. We cannot subscribe to this contention as
the procedure of ascertaining the truth by means of a lie detector test has never been
accepted in our jurisdiction; thus, any findings based thereon cannot be considered
conclusive.
Finally, the accused chides Gregorio for supposedly suppressing a very material piece
of evidence, i.e., the latter failed to present as witnesses a certain Renato and his wife
who allegedly saw the holduppers running away from the crime scene. But this is only
a disputable presumption under Sec. 3, par. (e), Rule 131, of the Rules of Court on
evidence, which does not apply in the present case as the evidence allegedly omitted is
equally accessible and available to the defense.
These attempts of the accused to discredit Gregorio obviously cannot hold ground.
Neither can they bolster his alibi. For alibi to be believed it must be shown that (a) the
accused was in another place at the time of the commission of the offense, and (b) it
was physically impossible for him to be at the crime scene.12
In this case, the accused claims to have left for Bicol the day before the incident. To
prove this, he presented his father and brother but their testimonies did not meet the
requisite quantum to establish his alibi. While his father testified that the accused
borrowed money from him for his fare to Bicol for the baptism of a daughter, he could
not say whether the accused actually went to Bicol. As regards the claim of Romeo,
brother of the accused, that he accompanied the accused to the bus stop on 9 May 1994
and even helped him with his things, seeing the accused off is not the same as seeing
him actually get off at his destination. Given the circumstances of this case, it is
possible for the accused to have alighted from the bus before reaching Bicol,
perpetrated the crime in the evening of 10 May 2000, proceeded to Bicol and arrived
there on 12 May 2000 for his daughters baptism.
Thus the trial court was correct in disregarding the alibi of the accused not only
because he was positively identified by Gregorio Tactacan but also because it was not
shown that it was physically impossible for him to be at the crime scene on the date
and time of the incident.
Indeed the accused is guilty. But that the accused was guilty of Highway Robbery with
Homicide under PD 532 was erroneous. As held in a number of cases, conviction for
highway robbery requires proof that several accused were organized for the purpose of
committing it indiscriminately.13 There is no proof in the instant case that the accused
and his cohorts organized themselves to commit highway robbery. Neither is there
proof that they attempted to commit similar robberies to show the "indiscriminate"
perpetration thereof. On the other hand, what the prosecution established was only a
single act of robbery against the particular persons of the Tactacan spouses. Clearly,
this single act of depredation is not what is contemplated under PD 532 as its objective
is to deter and punish lawless elements who commit acts of depredation upon persons
and properties of innocent and defenseless inhabitants who travel from one place to
another thereby disturbing the peace and tranquility of the nation and stunting the
economic and social progress of the people.
Consequently, the accused should be held liable for the special complex crime of
robbery with homicide under Art. 294 of the Revised Penal Code as amended by RA
765914 as the allegations in the Information are enough to convict him therefor. In the
interpretation of an information, what controls is the description of the offense charged
and not merely its designation.15cräläwvirtualibräry
Article 294, par. (1), of the Revised Penal Code as amended punishes the crime of
robbery with homicide by reclusion perpetua to death. Applying Art. 63, second par.,
subpar. 2, of the Revised Penal Code which provides that "[i]n all cases in which the
law prescribes a penalty composed of two indivisible penalties, the following rules
shall be observed in the application thereof: x x x 2. [w]hen there are neither
mitigating nor aggravating circumstances in the commission of the deed, the lesser
penalty shall be applied," the lesser penalty of reclusion perpetua is imposed in the
absence of any modifying circumstance.
As to the damages awarded by the trial court to the heirs of the victim, we sustain the
award of P50,000.00 as civil indemnity for the wrongful death of Lilia Tactacan. In
addition, the amount of P50,000.00 as moral damages is ordered. Also, damages for
loss of earning capacity of Lilia Tactacan must be granted to her heirs. The testimony
of Gregorio Tactacan, the victims husband, on the earning capacity of his wife,
94
together with a copy of his wifes payroll, is enough to establish the basis for the award.
The formula for determining the life expectancy of Lilia Tactacan, applying
the American Expectancy Table of Mortality, is as follows: 2/3 multiplied by (80 minus
the age of the deceased).16 Since Lilia was 48 years of age at the time of her
death,17 then her life expectancy was 21.33 years.
damages, P1,200.00 for actual damages, P438,971.40 for loss of earning capacity,
and P22,000.00 for funeral, burial and related expenses. Costs de oficio.
SO ORDERED.

At the time of her death, Lilia was earning P3,430.00 a month as a teacher at the San Notes.—In interpreting an information, what controls is not the designation but the
Roque Elementaryhool so that her annual income was P41,160.00. From this amount, description of the offense charged. (People vs. Sandoval, 254 SCRA 436 [1996])
50% should be deducted as reasonable and necessary living expenses to arrive at her
net earnings. Thus, her net earning capacity was P438,971.40 computed as follows: A finding of brigandage or highway robbery involves not just the locus of the crime or
Net earning capacity equals life expectancy times gross annual income less reasonable the fact that more than three (3) persons perpetrated it—it is essential to prove that the
and necessary living expenses outlaws were purposely organized not just for one act of robbery but for several
indiscriminate commissions thereof. (Filoteo, Jr. vs. Sandiganbayan, 263 SCRA 222
Net earning = Life expectancy x Gross annual reasonable & vs. Reanzares, 334 SCRA 624, G.R. No. 130656 June 29, 2000
[1996]) People
income - necessary living
capacity (x) expenses

x = 2 (80-48) x [P41,160.00 P20,580.00]

-
...... 3

= 21.33 x P20,580.00  

= P438,971.40  

However, the award of P1,000.00 representing the cash taken from Lilia Tactacan must
be increased to P1,200.00 as this was the amount established by the prosecution
without objection from the defense. The award of P172,000.00 for funeral, burial and
related expenses must be reduced to P22,000.00 as this was the only amount
sufficiently substantiated.18 There was no other competent evidence presented to
support the original award.

The amount of P2,500.00 as reimbursement for the Seiko wristwatch taken from
Gregorio Tactacan must be deleted in the absence of receipts or any other competent
evidence aside from the self-serving valuation made by the prosecution. An ordinary
witness cannot establish the value of jewelry and the trial court can only take judicial
notice of the value of goods which is a matter of public knowledge or is capable of
unquestionable demonstration. The value of jewelry therefore does not fall under either
category of which the court can take judicial notice.19cräläwvirtualibräry
WHEREFORE , the Decision appealed from is MODIFIED. Accused ARMANDO
REANZARES also known as "Armando Rianzares" is found GUILTY beyond
reasonable doubt of Robbery with Homicide under Art. 294 of the Revised Penal Code
as amended and is sentenced to reclusion perpetua. He is ordered to pay the heirs of
the victim P50,000.00 as indemnity for death, another P50,000.00 for moral
G.R. Nos. 135695-96. October 12, 2000.*
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. TOMAS TUNDAG,
accused-appellant.
Alibis and Denials; Alibi and denial hardly counts as a worthy and weighty ground for
exculpation in a trial involving an accused’s freedom and his life.—Appellant’s
defense of alibi and denial is negative and self-serving. It hardly counts as a worthy
and weighty ground for exculpation in a trial involving his freedom and his life.
Against the testimony of private complainant who testified on affirmative matters, such
defense is not only trite but pathetic. Denial is an inherently weak defense, which
95
becomes even weaker in the face of the positive identification by the victim of the
appellant as the violator of her honor. Indeed, we find that private complainant was
unequivocal in charging appellant with ravishing her. The victim’s account of the rapes
complained of was straightforward, detailed, and consistent. Her testimony never
wavered even after it had been explained to her that her father could be meted out the
death penalty if found guilty by the court.
Criminal Law; Rape; In a prosecution for rape, the complainant’s credibility is the
single most important issue.—In a prosecution for rape, the complainant’s credibility is
the single most important issue. The determination of the credibility of witnesses is
primarily the function of the trial court. The rationale for this is that the trial court has
the advantage of having observed at first hand the demeanor of the witnesses on the
stand and, therefore, is in a better position to form an accurate impression and
conclusion. Absent any showing that certain facts of value have clearly been
overlooked, which if considered could affect the result of the case, or that the trial
court’s finding are clearly arbitrary, the conclusions reached by the court of origin
must be respected and the judgment rendered affirmed.
Same; Same; Filing a case for incestuous rape is of such a nature that a daughter’s
accusation must be taken seriously—it goes against human experience that a girl would
fabricate a story which would drag herself as well as her family to a lifetime of
dishonor, unless that is the truth.—Such allegation of a family feud, however, does not
explain the charges away. Filing a case for incestuous rape is of such a nature that a
daughter’s accusation must be taken seriously. It goes against human experience that a
girl would fabricate a story which would drag herself as well as her family to a lifetime
of dishonor, unless that is the truth, for it is her natural instinct to protect her honor.
More so, where her charges could mean the death of her own father, as in this case.
Same; Same; Qualified Rape; Elements.—Section 335 of the Revised Penal Code, as
amended by Section 11 of R.A. No. 7659, penalizes rape of a minor daughter by her
father as qualified rape and a heinous crime. In proving such felony, the prosecution
must allege and prove the elements of rape: (1) sexual congress; (2) with woman; (3)
by force or without her consent and, in order to warrant the imposition of capital
punishment, the additional elements that; (4) the victim is under 18 years of age at the
time of the rape and (5) the offender is a parent of the victim.
Same; Same; Same; Judicial Notice; Words and Phrases; Judicial notice is the
cognizance of certain facts which judges may properly take and act on without proof
because they already know them.—Judicial notice is the cognizance of certain facts
which judges may properly take and act on without proof because they already know
them. Under the Rules of Court, judicial notice may either be mandatory or
discretionary.
Same; Same; Same; Same; In this case, judicial notice of the age of the victim is
improper, despite the defense counsel’s admission, thereof acceding to the
prosecution’s motion.—In this case, judicial notice of the age of the victim is
improper, despite the defense counsel’s admission thereof acceding to the
prosecution’s motion. As required by Section 3 of Rule 129, as to any other matters
such as age, a hearing is required before courts can take judicial notice of such fact.
Generally, the age of the victim may be proven by the birth or baptismal certificate of
the victim, or in the absence thereof, upon showing that said documents were lost or
destroyed, by other documentary or oral evidence sufficient for the purpose.
Same; Same; Same; The minority of the victim must be proved with equal certainty
and clearness as the crime itself.—In several recent cases, we have emphasized the
need for independent proof of the age of the victim, aside from testimonial evidence
from the victim or her relatives. In People v. Javier, we stressed that the prosecution
must present independent proof of the age of the victim, even though it is not contested
by the defense. The minority of the victim must be proved with equal certainty and
clearness as the crime itself. In People v. Cula, we reiterated that it is the burden of the
prosecution to prove with certainty the fact that the victim was below 18 when the rape
was committed in order to justify the imposition of the death penalty. Since the record
of the case was bereft of any independent evidence thereon, such as the victim’s duly
certified Certificate of Live Birth, accurately showing private complainant’s age,
appellant could not be convicted of rape in its qualified form. In People v. Veloso, the
victim was alleged to have been only 9 years of age at the time of the rape. It held that
the trial court was correct when it ruled that the prosecution failed to prove the victim’s
age other than through the testimony of her father and herself.
Same; Same; Same; The failure to sufficiently establish victim’s age by independent
proof is a bar to conviction for rape in its qualified form.—Considering the statutory
requirement in Section 335 of the Revised Penal Code as amended by R.A. No. 7659
and R.A. No. 8353, we reiterate here what the Court has held in Javier without any
dissent, that the failure to sufficiently establish victim’s age by independent proof is a
bar to conviction for rape in its qualified form. For, in the words of Melo, J.,
“independent proof of the actual age of a rape victim becomes vital and essential so as
to remove an ‘iota of doubt’ that the case falls under the qualifying circumstances” for
the imposition of the death penalty set by the law.
Same; Same; Same; The father-daughter relationship has been treated by Congress in
the nature of a special circumstance which makes the imposition of the death penalty
mandatory.—The award of exemplary damages separately is also in order, but on a
different basis and for a different amount. Appellant being the father of the victim, a
fact duly proved during trial, we find that the alternative circumstance of relationship
should be appreciated here as an aggravating circumstance. Under Article 2230 of the
New Civil Code, exemplary damages may be imposed when the crime was committed
96
with one or more aggravating circumstances. Hence, we find an award of exemplary
damages in the amount of P25,000.00 proper. Note that generally, in rape cases
imposing the death penalty, the rule is that relationship is no longer appreciated as a
generic aggravating circumstance in view of the amendments introduced by R.A. Nos.
7659 and 8353. The father-daughter relationship has been treated by Congress in the
nature of a special circumstance which makes the imposition of the death penalty
mandatory. However, in this case, the special qualifying circumstance of relationship
was proved but not the minority of the victim, taking the case out of the ambit of
mandatory death sentence. Hence, relationship can be appreciated as a generic
aggravating circumstance in this instance so that exemplary/damages are called for. In
rapes committed by fathers on their own daughters, exemplary damages may be
imposed to deter other fathers with perverse tendency or aberrant sexual behavior from
sexually abusing their own daughters. People vs. Tundag, 342 SCRA 704, G.R. Nos.
135695-96 October 12, 2000
For automatic review is the judgment of the Regional Trial Court of Mandaue City,
Branch 28, in Criminal Cases Nos.DU-6186 and DU-6203, finding appellant Tomas
Tundag guilty of two counts of incestuous rape and sentencing him to death twice.
On November 18, 1997, private complainant Mary Ann Tundag filed with the
Mandaue City Prosecutor’s Office two separate complaints for incestuous rape. The
first complaint, docketed as Criminal Case No. DU-6186, alleged:
That on or about the 5th day of September, 1997, in the City of Mandaue, Philippines,
and within the jurisdiction of this Honorable Court, the above-named accused, being
the father of complainant MARY ANN TUNDAG, who is a 13-year-old girl, with
deliberate intent, did then and there wilfully, unlawfully and feloniously have sexual
intercourse with the said offended party against the latter’s will.
CONTRARY TO LAW.1
The other, docketed as Criminal Case No. DU-6203, averred:
That on or about the 7th day of November, 1997, in the City of Mandaue, Philippines,
and within the jurisdiction of this Honorable Court, the above-named accused, being
the father of complainant MARY ANN TUNDAG, who is a 13-year-old girl, with
deliberate intent, did then and there wilfully, unlawfully and feloniously have sexual
intercourse with the said offended party against the latter’s will.
CONTRARY TO LAW.2
Upon arraignment appellant, assisted by counsel de parte, pleaded "Not Guilty" to the
charges.
The two cases were consolidated and a joint trial ensued.
Appellant’s defense was bare denial. He claimed that private complainant had
fabricated the rape charges against him since he and his daughter, "had a quarrel when
he accordingly reprimanded her for going out whenever he was not at home."3
Appellant did not present any witness to reinforce his testimony.
On August 31, 1998, the trial court rendered its decision, thus:
WHEREFORE, foregoing premises considered, Joint Judgment is hereby rendered, to
wit:
I. In Criminal Case No. DU-6186 -
a) Finding the herein accused TOMAS TUNDAG guilty beyond reasonable doubt for
the crime of rape, said accused is hereby sentenced to the penalty of death;
b) To indemnify the offended party Mary Ann Tundag the following amounts:
(1) P50,000.00 by reason of the commission of the offense of rape upon her; and
(2) Another P50,000.00 as moral and exemplary damages under Article 2219 in
relation to Articles 2217 and 2230 of the New Civil Code for the pain and moral shock
suffered by her and for the commission of the crime of rape with one qualifying
aggravating circumstance; and
c) To pay the costs.
II. In Criminal Case No. DU-6203 -
a) Finding the herein accused TOMAS TUNDAG guilty beyond reasonable doubt for
the crime of rape, said accused is hereby sentenced to the penalty of death;
b) To indemnify the offended party Mary Ann Tundag the following amounts:
(1) P50,000.00 by reason of the commission of the offense of rape upon her; and
(2) Another P50,000.00 as moral and exemplary damages under Article 2219 in
relation to Articles 2217 and 2230 of the New Civil Code for the pain and moral shock
suffered by her and for the commission of the crime of rape with one qualifying
aggravating circumstance; and
(3) To pay the costs.
SO ORDERED.4
In its judgment, the court below gave credence to complainant’s version of what
accused did to her.
97
The evidence for the prosecution as adduced during the trial on the merits clearly
shows that private complainant Mary Ann Tundag is a 13 year old girl who does not
know how to read and write and has an IQ of 76% which is a very low general mental
ability and was living with her father, the herein accused, at Galaxy Compound,
Mandaue City.
xxx
That on September 5, 1997 at about 10:00 o’clock in the evening, she was in the house
together with her father. But before she went to sleep, her father was already lying
down on the mat while herself (sic) just lied down at his head side which was not
necessarily beside him. However, when she was already sleeping, she noticed that her
father who was already undressed was beside her and was embracing her. Then, he
undressed her which she resisted but her father used a knife and told her that he would
kill her if she shouts and after that, he inserted his penis into her vagina and told her
not to shout or tell anyone. In effect, his penis penetrated her genital, which made her
vagina bleed and was very painful.
That when the penis of her father was already inserted in her vagina, her father was all
the time asking by saying (sic) : ‘Does it feel good?’ And at the same time, he was
laughing and further, told her that a woman who does not marry can never enter
heaven and he got angry with her when she contradicted his statement.
That while the penis of her father was inside her vagina and (he) was humping over
her, she felt intense pain that she cried and told him to pull it out but did not accede
and in fact, said: ‘Why will I pull it out when it feels so good(?)’
That after removing his penis from her vagina and after telling her that she could not
go to heaven if she did not get married, her father just stayed there and continued
smoking while she cried.
That in the evening of November 7, 1997, she was at home washing the dishes while
her father was just smoking and squatting. That after she finished washing the dishes,
she lied (sic) down to sleep when her father embraced her and since she does not like
what he did to her, she placed a stool between them but he just brushed it aside and
laid down with her and was able to take her womanhood again by using a very sharp
knife which he was holding and was pointing it at the right side of her neck which
made her afraid.
That in the early morning of the following day, she left her father’s place and went to
her neighbor by the name of Bebie Cabahug and told her what had happened to her,
who, in turn, advised her to report the matter to the police, which she did and
accompanied by the policemen, she went to the Southern Islands Hospital where she
was examined and after her medical examination, she was brought back by the police
and was investigated by them."5
Appellant’s claim that the complainant’s charges were manufactured did not impress
the trial court, which found him twice guilty of rape. Now before us, appellant assails
his double conviction, simply contending that:6
THE TRIAL COURT HAS COMMITTED AN ERROR IN NOT ABSOLVING THE
ACCUSED-APPELLANT OF THE CRIMES CHARGED IN THE INFORMATIONS
DESPITE THE PRESENCE OF REASONABLE DOUBT TO EXCULPATE HIM OF
THE SAME.
Appellant flatly denies that the incidents complained of ever took place. He contends
that on September 5, 1997, he was working as a watch repairman near Gal’s Bakery in
Mandaue City Market and went home tired and sleepy at around 11:00 o’clock that
evening. On November 7, 1997, he claims he was at work. In his brief, he argues that it
was impossible for him to have raped his daughter because when the incidents
allegedly transpired, "he went to work and naturally, being exhausted and tired, it is
impossible for him to do such wrongdoings."7
The Office of the Solicitor General disagrees with appellant and urges the Court to
affirm the trial court’s decision, with the recommendation that the award of damages
and indemnity ex delicto be modified to conform to prevailing jurisprudence.
Considering the gravity of the offense charged as a heinous crime and the
irreversibility of the penalty of death imposed in each of these cases before us, the
Court leaves no stone unturned in its review of the records, including the evidence
presented by both the prosecution and the defense. Conviction must rest on nothing
less than a moral certainty of guilt. 8 But here we find no room to disturb the trial
court’s judgment concerning appellant’s guilt, because his defense is utterly untenable.
Appellant’s defense of alibi and denial is negative and self-serving. It hardly counts as
a worthy and weighty ground for exculpation in a trial involving his freedom and his
life. Against the testimony of private complainant who testified on affirmative
matters,9 such defense is not only trite but pathetic. Denial is an inherently weak
defense, which becomes even weaker in the face of the positive identification by the
victim of the appellant as the violator of her honor. 10 Indeed, we find that private
complainant was unequivocal in charging appellant with ravishing her. The victim’s
account of the rapes complained of was straightforward, detailed, and consistent. 11 Her
testimony never wavered even after it had been explained to her that her father could
be meted out the death penalty if found guilty by the court.12
In a prosecution for rape, the complainant’s credibility is the single most important
issue.13 The determination of the credibility of witnesses is primarily the function of the
trial court. The rationale for this is that the trial court has the advantage of having
observed at first hand the demeanor of the witnesses on the stand and, therefore, is in a
better position to form an accurate impression and conclusion. 14 Absent any showing
98
that certain facts of value have clearly been overlooked, which if considered could
affect the result of the case, or that the trial court’s finding are clearly arbitrary, the
conclusions reached by the court of origin must be respected and the judgment
rendered affirmed.15
Moreover, we note here that private complainant’s testimony is corroborated by
medical findings that lacerations were present in her hymen. The examination
conducted by Dr. Bessie Acebes upon the private complainant yielded the following
results:
Genitalia: grossly female
Pubic Hairs: scanty
a female who has not yet experienced sexual intercourse is V-shaped. 18 While Dr.
Acebes conceded under cross-examination, that the existence of the datum "U-shape(d)
fourchette does not conclusively and absolutely mean that there was sexual intercourse
or contact because it can be caused by masturbation of fingers or other
things,"19 nonetheless, the presence of the hymenal lacerations tends to support private
complainant’s claim that she was raped by appellant.
Appellant next contends that his daughter pressed the rape charges against him because
she had quarreled with him after he had castigated her for misbehavior. He stresses that
the prosecution did not rebut his testimony regarding his quarrel or misunderstanding
with private complainant. He urges us to consider the charges filed against him as the
result of his frequent castigation of her delinquent behavior.20

Labia Majora: coaptated Such allegation of a family feud, however, does not explain the charges away. Filing a
case for incestuous rape is of such a nature that a daughter’s accusation must be taken
Labia Minora: -do- seriously. It goes against human experience that a girl would fabricate a story which
would drag herself as well as her family to a lifetime of dishonor, unless that is the
Fourchette: U-shaped
truth, for it is her natural instinct to protect her honor.21 More so, where her charges
Vestibule: pinkish could mean the death of her own father, as in this case.

Hymen: + old healed laceration at 3 and 9 o’clock position(s). Appellant likewise points out that it was very unlikely for him to have committed the
crimes imputed to him considering that he and his wife had ten children to attend to
Orifice: admits 2 fingers with ease and care for. This argument, however, is impertinent and immaterial. Appellant was
estranged from his wife, and private complainant was the only child who lived with
Vagina:
him.22 As pointed out by the Solicitor General, appellant was thus "free to do as he
Walls: pinkish wished to satisfy his bestial lust on his daughter." 23

Ruganities: prominent Nor does appellant’s assertion that private complainant has some psychological
problems and a low IQ of 76 in any way favor his defense. These matters did not affect
Uterus: small the credibility of her testimony that appellant raped her twice. We note that the victim
understood the consequences of prosecuting the rape charges against her own father, as
Cervix: closed
shown by the following testimony of the victim on cross-examination:
Discharges: Mucoid, minimal
Q : Were you informed that if, and when your father will be found guilty, your father
Smears: will be sentenced to death?

Conclusions: sperm identification (-) A : Yes.

Gram staining of vaginal disc.16 Q : Until now you wanted that your father will be sentenced by death?

Dr. Acebes testified that her findings of healed hymenal lacerations in the A (Witness nodding.)
complainant’s private parts meant a history of sexual congress on her part. 17 According
xxx
to her, the lacerations may have been caused by the entry of an erect male organ into
complainant’s genitals. The examining physician likewise pointed out that previous
coitus may be inferred from complainant’s U-shaped fourchette since the fourchette of

99
Q : I will inform you, Miss Witness, that you have filed two cases against your father
and in case your father would be found guilty, two death sentences will be imposed
against him?
A: Yes.
Q: With that information, do you still want this case would proceed?
A: I want this to proceed.24
Indeed, appellant is guilty. But is the penalty of death imposed on him correct?
Section 335 of the Revised Penal Code, as amended by Section 11 of R.A. No.
7659,25 penalizes rape of a minor daughter by her father as qualified rape 26 and a
heinous crime. In proving such felony, the prosecution must allege and prove the
elements of rape: (1) sexual congress; (2) with woman; (3) by force or without her
consent27 and in order to warrant the imposition of capital punishment, the additional
elements that: (4) the victim is under 18 years of age at the time of the rape and (5) the
offender is a parent of the victim.28
In this case, it was sufficiently alleged and proven that the offender was the victim’s
father.29 But the victim’s age was not properly and sufficiently proved beyond
reasonable doubt. She testified that she was thirteen years old at the time of the rapes.
However, she admitted that she did not know exactly when she was born because her
mother did not tell her. She further said that her birth certificate was likewise with her
mother. In her own words, the victim testified - 30
COURT TO WITNESS
Q: When were you born?
A: I do not know.
Q: You do not know your birthday?
A: My mama did not tell me exactly when I asked her.
COURT: Proceed.
FISCAL PEREZ: For our failure to secure the Birth Certificate Your Honor, may we
just request for judicial notice that the victim here is below 18 years old.
ATTY. SURALTA: Admitted. …
Judicial notice is the cognizance of certain facts which judges may properly take and
act on without proof because they already know them.31 Under the Rules of Court,
judicial notice may either be mandatory or discretionary. Section 1 of Rule 129 of the
Rules of Court provides when court shall take mandatory judicial notice of facts -
SECTION 1. Judicial notice, when mandatory. - A court shall take judicial notice
without the introduction of evidence, of the existence and territorial extent of states,
their political history, forms of government and symbols of nationality, the law of
nations, the admiralty and maritime courts of the world and their seals, the political
constitution and history of the Philippines, the official acts of the legislative, executive
and judicial departments of the Philippines, the laws of nature, the measure of time,
and the geographical divisions.
Section 2 of Rule 129 enumerates the instances when courts may take discretionary
judicial notice of facts -
SEC. 2. Judicial notice, when discretionary. - A court may take judicial notice of
matters which are of public knowledge, or are capable of unquestionable
demonstration or ought to be known to judges because of their judicial functions.
Thus, it can be considered of public knowledge and judicially noticed that the scene of
the rape is not always nor necessarily isolated or secluded for lust is no respecter of
time or place. The offense of rape can and has been committed in places where people
congregate, e.g. inside a house where there are occupants, a five (5) meter room with
five (5) people inside, or even in the same room which the victim is sharing with the
accused’s sister.32
The Court has likewise taken judicial notice of the Filipina’s inbred modesty and
shyness and her antipathy in publicly airing acts which blemish her honor and virtue. 33
On the other hand, matters which are capable of unquestionable demonstration pertain
to fields of professional and scientific knowledge. For example, in People v.
Alicante,34 the trial court took judicial notice of the clinical records of the attending
physicians concerning the birth of twin baby boys as "premature" since one of the
alleged rapes had occurred 6 to 7 months earlier.
As to matters which ought to be known to judges because of their judicial functions, an
example would be facts which are ascertainable from the record of court proceedings,
e.g. as to when court notices were received by a party.
With respect to other matters not falling within the mandatory or discretionary judicial
notice, the court can take judicial notice of a fact pursuant to the procedure in Section 3
of Rule 129 of the Rules of Court which requires that -
SEC. 3. Judicial notice, when hearing necessary. - During the trial, the court, on its
own initiative, or on request of a party, may announce its intention to take judicial
notice of any matter and allow the parties to be heard thereon.
After the trial, and before judgment or on appeal, the proper court, on its own initiative
or on request of a party, may take judicial notice of any matter and allow the parties to
be heard thereon if such matter is decisive of a material issue in the case.
100
In this case, judicial notice of the age of the victim is improper, despite the defense
counsel’s admission, thereof acceding to the prosecution’s motion. As required by
Section 3 of Rule 129, as to any other matters such as age, a hearing is required before
courts can take judicial notice of such fact. Generally, the age of the victim may be
proven by the birth or baptismal certificate of the victim, or in the absence thereof,
upon showing that said documents were lost or destroyed, by other documentary or
oral evidence sufficient for the purpose.
Thus, in People v. Rebancos, 172 SCRA 426 (1989), the victim was below 12 and we
found that the rape committed was statutory rape. The mother testified that her
daughter was born on October 26, 1974, and so was only 9 years old at the time of the
rape on February 12, 1984. Although no birth certificate was presented because the
victim’s birth had allegedly not been registered, her baptismal certificate was duly
presented. Hence, we ruled that the mother’s testimony coupled with the presentation
of the baptismal certificate was sufficient to establish that the victim was below 12 at
the time of the rape.
However, in People v. Vargas, 257 SCRA 603 (1996), we ruled that appellant can only
be convicted of simple rape, and not statutory rape, because of failure of the
prosecution to prove the minority of the victim, who was allegedly 10 years old at the
time of the rape.1âwphi1 The prosecution failed to present either the birth or baptismal
certificate of the victim. Also there was no showing that the said documents were lost
or destroyed to justify their non-presentation. We held that testimony of the victim and
her aunt were hearsay, and that it was not correct for the trial court to judge the age of
the victim by her appearance.
In several recent cases, we have emphasized the need for independent proof of the age
of the victim, aside from testimonial evidence from the victim or her relatives.
In People v. Javier,35 we stressed that the prosecution must present independent proof
of the age of the victim, even though it is not contested by the defense. The minority of
the victim must be proved with equal certainty and clearness as the crime itself.
In People v. Cula,36 we reiterated that it is the burden of the prosecution to prove with
certainty the fact that the victim was below 18 when the rape was committed in order
to justify the imposition of the death penalty. Since the record of the case was bereft of
any independent evidence thereon, such as the victim’s duly certified Certificate of
Live Birth, accurately showing private complainant’s age, appellant could not be
convicted of rape in its qualified form. In People v. Veloso,37 the victim was alleged to
have been only 9 years of age at the time of the rape. It held that the trial court was
correct when it ruled that the prosecution failed to prove the victim’s age other than
through the testimony of her father and herself.
Considering the statutory requirement in Section 335 of the Revised Penal Code as
amended by R.A. No. 7659 and R.A. No. 8353, we reiterate here what the Court has
held in Javier without any dissent, that the failure to sufficiently establish victim’s age
by independent proof is a bar to conviction for rape in its qualified form. For, in the
words of Melo, J., "independent proof of the actual age of a rape victim becomes vital
and essential so as to remove an ‘iota of doubt’ that the case falls under the qualifying
circumstances" for the imposition of the death penalty set by the law.
In this case, the first rape was committed on September 5, 1997 and is therefore
governed by the death penalty law, R.A. 7659. The penalty for the crime of simple
rape or rape in its unqualified form under Art. 335 of the Revised Penal Code, as
amended by Sec. 11 of R.A. 7659, is reclusion perpetua. The second rape was
committed on November 7, 1997, after the effectivity of R.A. 8353, also known as the
Anti-Rape Law of 1997, which took effect on October 22, 1997. The penalty for rape
in its unqualified form remains the same.
As to civil indemnity, the trial court correctly awarded P50,000.00 for each count of
rape as civil indemnity. However, the award of another P50,000.00 as "moral and
exemplary damages under Article 2219 in relation to Articles 2217 and 2230 of the
Civil Code" for each count is imprecise. In rape cases, the prevailing jurisprudence
permits the award of moral damages without need for pleading or proof as to the basis
thereof.38 Thus, pursuant to current jurisprudence, we award the amount of P50,000.00
as moral damages for each count of rape.
The award of exemplary damages separately is also in order, but on a different basis
and for a different amount. Appellant being the father of the victim, a fact duly proved
during trial, we find that the alternative circumstance of relationship should be
appreciated here as an aggravating circumstance. Under Article 2230 of the New Civil
Code, exemplary damages may be imposed when the crime was committed with one or
more aggravating circumstances. Hence, we find an award of exemplary damages in
the amount of P25,000.00 proper. Note that generally, in rape cases imposing the death
penalty, the rule is that relationship is no longer appreciated as a generic aggravating
circumstance in view of the amendments introduced by R.A. Nos. 7659 and 8353. The
father-daughter relationship has been treated by Congress in the nature of a special
circumstance which makes the imposition of the death penalty mandatory. 39 However,
in this case, the special qualifying circumstance of relationship was proved but not the
minority of the victim, taking the case out of the ambit of mandatory death sentence.
Hence, relationship can be appreciated as a generic aggravating circumstance in this
instance so that exemplary damages are called for. In rapes committed by fathers on
their own daughters, exemplary damages may be imposed to deter other fathers with
perverse tendency or aberrant sexual behavior from sexually abusing their own
daughters.40
WHEREFORE, the judgment of the Regional Trial Court of Mandaue City, Branch
28, in Criminal Case Nos. DU-6186 and DU-6203, is hereby MODIFIED as follows:
appellant Tomas Tundag is found guilty of two (2) counts of simple rape; and for each
count, sentenced to reclusion perpetua and ordered to pay the victim the amount of
101
P50,000.00 as indemnity, P50,000.00 as moral damages, and P25,000.00 as exemplary
damages.
No pronouncement as to costs.
SO ORDERED.
Notes.—The Supreme Court takes judicial cognizance of the fact that in rural areas in
the Philippines, young ladies are strictly required to act with circumspection and
prudence, and that great caution is observed so that their reputations shall remain
untainted. (People vs. Godoy, 250 SCRA 676 [1995])
An action to cancel a person’s Birth Certificate for being allegedly void ab initio does
not prescribe, and the prescriptive period set forth in Article 170 of the Family Code
does not apply. (Babiera vs. Catotal, 333 SCRA 487 [2000])
A duly certified certificate of live birth accurately showing the complainant’s age or
some other official document or record such as a school record, has been recognized as
competent evidence to prove the age of the victim. (People vs. Tabanggay, 334 SCRA
575 [2000]) People vs. Tundag, 342 SCRA 704, G.R. Nos. 135695-96 October 12,
2000
G.R. No. 114776. February 2, 2000.*
MENANDRO B. LAUREANO, petitioner, vs. COURT OP APPEALS AND
SINGAPORE AIRLINES LIMITED, respondents.
Actions; Conflict of Laws; The party who claims the applicability of a foreign law
has the burden of proof, and where said party has failed to discharge the burden,
Philippine law applies.—At the outset, we find it necessary to state our concurrence on
the assumption of jurisdiction by the Regional Trial Court of Manila, Branch 9. The
trial court rightly ruled on the application of Philippine law, thus: “Neither can the
Court determine whether the termination of the plaintiff is legal under the Singapore
Laws because of the defendant’s failure to show which specific laws of Singapore
Laws apply to this case. As substantially discussed in the preceding paragraphs, the
Philippine Courts do not take judicial notice of the laws of Singapore. The defendant
that claims the applicability of the Singapore Laws to this case has the burden of proof.
The defendant has failed to do so. Therefore, the Philippine law should be applied.”
Same; Labor Law; Prescription; Illegal Dismissals; In illegal dismissal, it is settled,
that the ten-year prescriptive period fixed in Article 1144 of the Civil Code may not be
invoked, for the Civil Code is a law of general application, while the prescriptive
period fixed in Article 292 of the Labor Code is a special law applicable to claims
arising from employee-employer relations.—What rules on prescription should apply
in cases like this one has long been decided by this Court. In illegal dismissal, it is
settled, that the ten-year prescriptive period fixed in Article 1144 of the Civil Code
may not be invoked by petitioners, for the Civil Code is a law of general application,
while the prescriptive period fixed in Article 292 of the Labor Code [now Article 291]
is a SPECIAL LAW applicable to claims arising from employee-employer relations.
Same; Same; Same; Although the commencement of a civil action stops the running of
the statute of prescription or limitations, its dismissal or voluntary abandonment by
plaintiff leaves the parties in exactly the same position as though no action had been
commenced at all.—Petitioner claims that the running of the prescriptive period was
tolled when he filed his complaint for illegal dismissal before the Labor Arbiter of the
National Labor Relations Commission. However, this claim deserves scant
consideration; it has no legal leg to stand on. In Olympia International, Inc. vs. Court
of Appeals, we held that “although the commencement of a civil action stops the
running of the statute of prescription or limitations, its dismissal or voluntary
abandonment by plaintiff leaves the parties in exactly the same position as though no
action had been commenced at all.”
Same; Same; Same; Contracts; It is a settled rule that contracts have the force of law
between the parties.—As to whether petitioner’s separation from the company due to
retrenchment was valid, the appellate court found that the employment contract of
petitioner allowed for pre-termination of employment. We agree with the Court of
Appeals when it said, “It is a settled rule that contracts have the force of law between
the parties. From the moment the same is perfected, the parties are bound not only to
the fulfillment of what has been expressly stipulated but also to all consequences
which, according to their nature, may be in keeping with good faith, usage and law.
Thus, when plaintiff-appellee accepted the offer of employment, he was bound by the
terms and conditions set forth in the contract, among others, the right of mutual
termination by giving three months written notice or by payment of three months
102
salary. Such provision is clear and readily understandable, hence, there is no room for
interpretation.” Laureano vs. Court of Appeals, 324 SCRA 414, G.R. No. 114776
February 2, 2000
This petition for review on certiorari under Rule 45 of the Rules of Court seeks to
reverse the Decision of the Court of Appeals, dated October 29, 1993, in C.A. G.R.
No. CV 34476, as well as its Resolution dated February 28, 1994, which denied the
motion for reconsideration.
The facts of the case as summarized by the respondent appellate court are as follows:
Sometime in 1978, plaintiff [Menandro B. Laureano, herein petitioner], then Director
of Flight Operations and Chief Pilot of Air Manila, applied for employment with
defendant company [herein private respondent] through its Area Manager in Manila.
On September 30, 1978, after the usual personal interview, defendant wrote to
plaintiff, offering a contract of employment as an expatriate B-707 captain for an
original period of two (2) years commencing on January 21, 1978. Plaintiff accepted
the offer and commenced working on January 20, 1979. After passing the six-month
probation period, plaintiffs appointment was confirmed effective July 21, 1979.
(Annex "B", p. 30, Rollo).
On July 21, 1979, defendant offered plaintiff an extension of his two-year contract to
five (5) years effective January 21, 1979 to January 20, 1984 subject to the terms and
conditions set forth in the contract of employment, which the latter accepted (Annex
"C" p. 31, Rec.).
During his service as B-707 captain, plaintiff on August 24, 1980, while in command
of a flight, committed a noise violation offense at the Zurich Airport, for which
plaintiff apologized.(Exh. "3", p. 307, Rec.).
Sometime in 1980, plaintiff featured in a tail scraping incident wherein the tail of the
aircraft scraped or touched the runway during landing. He was suspended for a few
days until he was investigated by board headed by Capt. Choy. He was reprimanded.
On September 25, 1981, plaintiff was invited to take a course of A-300 conversion
training at Aeroformacion, Toulouse, France at dependant's expense. Having
successfully completed and passed the training course, plaintiff was cleared on April 7,
1981, for solo duty as captain of the Airbus A-300 and subsequently appointed as
captain of the A-300 fleet commanding an Airbus A-300 in flights over Southeast
Asia. (Annexes "D", "E" and "F", pp. 34-38, Rec.).
Sometime in 1982, defendant, hit by a recession, initiated cost-cutting measures.
Seventeen (17) expatriate captains in the Airbus fleet were found in excess of the
defendant's requirement (t.s.n., July 6, 1988. p. 11). Consequently, defendant informed
its expatriate pilots including plaintiff of the situation and advised them to take
advance leaves. (Exh. "15", p. 466, Rec.)
Realizing that the recession would not be for a short time, defendant decided to
terminate its excess personnel (t.s.n., July 6, 1988, p. 17). It did not, however,
immediately terminate it's A-300 pilots. It reviewed their qualifications for possible
promotion to the B-747 fleet. Among the 17 excess Airbus pilots reviewed, twelve
were found qualified. Unfortunately, plaintiff was not one of the twelve.
On October 5, 1982, defendant informed plaintiff of his termination effective
November 1, 1982 and that he will be paid three (3) months salary in lieu of three
months notice (Annex "I", pp. 41-42, Rec.). Because he could not uproot his family on
such short notice, plaintiff requested a three-month notice to afford him time to exhaust
all possible avenues for reconsideration and retention. Defendant gave only two (2)
months notice and one (1) month salary. (t.s.n., Nov. 12, 1987. p. 25).
Aggrieved, plaintiff on June 29, 1983, instituted a case for illegal dismissal before the
Labor Arbiter. Defendant moved to dismiss on jurisdiction grounds. Before said
motion was resolved, the complaint was withdrawn. Thereafter, plaintiff filed the
instant case for damages due to illegal termination of contract of services before the
court a quo (Complaint, pp. 1-10, Rec.).
Again, defendant on February 11, 1987 filed a motion to dismiss alleging inter alia: (1)
that the court has no jurisdiction over the subject matter of the case, and (2) that
Philippine courts have no jurisdiction over the instant case. Defendant contends that
the complaint is for illegal dismissal together with a money claim arising out of and in
the course of plaintiffs employment "thus it is the Labor Arbiter and the NLRC who
have the jurisdiction pursuant to Article 217 of the Labor Code" and that, since
plaintiff was employed in Singapore, all other aspects of his employment contract
and/or documents executed in Singapore. Thus, defendant postulates that Singapore
laws should apply and courts thereat shall have jurisdiction. (pp. 50-69, Rec.).
In traversing defendant's arguments, plaintiff claimed that: (1) where the items
demanded in a complaint are the natural consequences flowing from a breach of an
obligation and not labor benefits, the case is intrinsically a civil dispute; (2) the case
involves a question that is beyond the field of specialization of labor arbiters; and (3) if
the complaint is grounded not on the employee's dismissal per se but on the manner of
said dismissal and the consequence thereof, the case falls under the jurisdiction of the
civil courts. (pp. 70-73, Rec.)
On March 23, 1987, the court a quo denied defendant's motion to dismiss (pp. 82-
84, Ibid). The motion for reconsideration was likewise denied. (p. 95 ibid.)
On September 16, 1987, defendant filed its answer reiterating the grounds relied upon
in its motion to dismiss and further arguing that plaintiff is barred by laches, waiver,
103
and estoppel from instituting the complaint and that he has no cause of action . (pp.
102-115)1
On April 10, 1991, the trial court handed down its decision in favor of plaintiff. The
dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered in favor of plaintiff Menandro Laureano
and against defendant Singapore Airlines Limited, ordering defendant to pay plaintiff
the amounts of
SIN$396,104.00, or its equivalent in Philippine currency at the current rate of
exchange at the time of payment, as and for unearned compensation with legal interest
from the filing of the complaint until fully paid;
SIN$154,742.00, or its equivalent in Philippine currency at the current rate of
exchange at the time of payment; and the further amounts of P67,500.00 as
consequential damages with legal interest from the filing of the complaint until fully
paid;
P1,000,000.00 as and for moral damages; P1,000,000.00 as and for exemplary
damages; and P100,000.00 as and for attorney's fees.
Costs against defendant.
SO ORDERED.2
Singapore Airlines timely appealed before the respondent court and raised the issues of
jurisdiction, validity of termination, estoppel, and damages.
On October 29, 1993, the appellate court set aside the decision of the trial court, thus,
. . . In the instant case, the action for damages due to illegal termination was filed by
plaintiff-appellee only on January 8, 1987 or more than four (4) years after the
effectivity date of his dismissal on November 1, 1982. Clearly, plaintiff-appellee's
action has already prescribed.
WHEREFORE, the appealed decision is hereby REVERSED and SET ASIDE. The
complaint is hereby dismissed.
SO ORDERED.3
Petitioner's and Singapore Airlines' respective motions for reconsideration were
denied.
Now, before the Court, petitioner poses the following queries:
1. IS THE PRESENT ACTION ONE BASED ON CONTRACT WHICH
PRESCRIBES IN TEN YEARS UNDER ARTICLE 1144 OF THE NEW CIVIL
CODE OR ONE FOR DAMAGES ARISING FROM AN INJURY TO THE RIGHTS
OF THE PLAINTIFF WHICH PRESCRIBES IN FOUR YEARS UNDER ARTICLE
1146 OF THE NEW CIVIL CODE?
2. CAN AN EMPLOYEE WITH A FIXED PERIOD OF EMPLOYMENT BE
RETRENCHED BY HIS EMPLOYER?
3. CAN THERE BE VALID RETRENCHMENT IF AN EMPLOYER MERELY
FAILS TO REALIZE THE EXPECTED PROFITS EVEN IF IT WERE NOT, IN
FACT, INCURRING LOSSES?
At the outset, we find it necessary to state our concurrence on the assumption of
jurisdiction by the Regional Trial Court of Manila, Branch 9. The trial court rightly
ruled on the application of Philippine law, thus:
Neither can the Court determine whether the termination of the plaintiff is legal under
the Singapore Laws because of the defendant's failure to show which specific laws of
Singapore Laws apply to this case. As substantially discussed in the preceding
paragraphs, the Philippine Courts do not take judicial notice of the laws of Singapore.
The defendant that claims the applicability of the Singapore Laws to this case has the
burden of proof. The defendant has failed to do so. Therefore, the Philippine law
should be applied.4
Respondent Court of Appeals acquired jurisdiction when defendant filed its appeal
before said court.5 On this matter, respondent court was correct when it barred
defendant-appellant below from raising further the issue of jurisdiction.6
Petitioner now raises the issue of whether his action is one based on Article 1144 or on
Article 1146 of the Civil Code. According to him, his termination of employment
effective November 1, 1982, was based on an employment contract which is under
Article 1144, so his action should prescribe in 10 years as provided for in said article.
Thus he claims the ruling of the appellate court based on Article 1146 where
prescription is only four (4) years, is an error. The appellate court concluded that the
action for illegal dismissal originally filed before the Labor Arbiter on June 29, 1983,
but which was withdrawn, then filed again in 1987 before the Regional Trial Court,
had already prescribed.
In our view, neither Article 11447 nor Article 11468 of the Civil Code is here pertinent.
What is applicable is Article 291 of the Labor Code, viz:
Art. 291. Money claims. All money claims arising from employee-employer relations
accruing during the effectivity of this Code shall be filed within three (3) years from
the time the cause of action accrued; otherwise they shall be forever barred.
xxx-xxx-xxx
104
What rules on prescription should apply in cases like this one has long been decided by
this Court. In illegal dismissal, it is settled, that the ten-year prescriptive period fixed in
Article 1144 of the Civil Code may not be invoked by petitioners, for the Civil Code is
a law of general application, while the prescriptive period fixed in Article 292 of the
Labor Code [now Article 291] is a SPECIAL LAW applicable to claims arising from
employee-employer relations.9
More recently in De Guzman vs. Court of Appeals,10 where the money claim was based
on a written contract, the Collective Bargaining Agreement, the Court held:
. . . The language of Art. 291 of the Labor Code does not limit its application only to
"money claims specifically recoverable under said Code" but covers all money claims
arising from an employee-employer relations" (Citing Cadalin v. POEA Administrator,
238 SCRA 721, 764 [1994]; and Uy v. National Labor Relations Commission, 261
SCRA 505, 515 [1996]). . . .
It should be noted further that Article 291 of the Labor Code is a special law applicable
to money claims arising from employer-employee relations; thus, it necessarily
prevails over Article 1144 of the Civil Code, a general law. Basic is the rule in
statutory construction that "where two statutes are of equal theoretical application to a
particular case, the one designed therefore should prevail." (Citing Leveriza v.
Intermediate Appellate Court, 157 SCRA 282, 294.) Generalia specialibus non
derogant.11
In the light of Article 291, aforecited, we agree with the appellate court's conclusion
that petitioner's action for damages due to illegal termination filed again on January 8,
1987 or more than four (4) years after the effective date of his dismissal on November
1, 1982 has already prescribed.
In the instant case, the action for damages due to illegal termination was filed by
plaintiff-appelle only on January 8, 1987 or more than four (4) years after the
effectivity date of his dismissal on November 1, 1982. Clearly, plaintiff-appellee's
action has already prescribed.
We base our conclusion not on Article 1144 of the Civil Code but on which sets the
prescription period at three (3) years and which governs under this jurisdiction.
Petitioner claims that the running of the prescriptive period was tolled when he filed
his complaint for illegal dismissal before the Labor Arbiter of the National Labor
Relations Commission. However, this claim deserves scant consideration; it has no
legal leg to stand on. In Olympia International, Inc., v. , Court of Appeals, we held that
"although the commencement of a civil action stops the running of the statute of
prescription or limitations, its dismissal or voluntary abandonment by the plaintiff
leaves in exactly the same position as though no action had been commenced at all."12
Now, as to whether petitioner's separation from the company due to retrenchment was
valid, the appellate court found that the employment contract of petitioner allowed for
pre-termination of employment. We agree with the Court of Appeals when it said,
It is a settled rule that contracts have the force of law between the parties. From the
moment the same is perfected, the parties are bound not only to the fulfillment of what
has been expressly stipulated but also to all consequences which, according to their
nature, may be in keeping with good faith, usage and law. Thus, when plaintiff-
appellee accepted the offer of employment, he was bound by the terms and conditions
set forth in the contract, among others, the right of mutual termination by giving three
months written notice or by payment of three months salary. Such provision is clear
and readily understandable, hence, there is no room for interpretation.
xxx-xxx-xxx
Further, plaintiff-appellee's contention that he is not bound by the provisions of the
Agreement, as he is not a signatory thereto, deserves no merit. It must be noted that
when plaintiff-appellee's employment was confirmed, he applied for membership with
the Singapore Airlines Limited (Pilots) Association, the signatory to the
aforementioned Agreement. As such, plaintiff-appellee is estopped from questioning
the legality of the said agreement or any proviso contained therein.13
Moreover, the records of the present case clearly show that respondent court's decision
is amply supported by evidence and it did not err in its findings, including the reason
for the retrenchment:
When defendant-appellant was faced with the world-wide recession of the airline
industry resulting in a slow down in the company's growth particularly in the regional
operation (Asian Area) where the Airbus 300 operates. It had no choice but to adopt
cost cutting measures, such as cutting down services, number of frequencies of flights,
and reduction of the number of flying points for the A-300 fleet (t.s.n., July 6, 1988,
pp. 17-18). As a result, defendant-appellant had to lay off A-300 pilots, including
plaintiff-appellee, which it found to be in excess of what is reasonably needed. 14
All these considered, we find sufficient factual and legal basis to conclude that
petitioner's termination from employment was for an authorized cause, for which he
was given ample notice and opportunity to be heard, by respondent company. No error
nor grave abuse of discretion, therefore, could be attributed to respondent appellate
court.
ACCORDINGLY, the instant petition is DISMISSED. The decision of the Court of
Appeals in C.A. CV No. 34476 is AFFIRMED.
SO ORDERED.
105
Notes.—It is a time-honored principle that contracts are respected as the law between
the contracting parties.
The parties are charged with knowledge of the existing law at the time they enter into a
contract and at the time it is to become operative—and, a person is presumed to be
more knowledgeable about his own state law than his alien or foreign contemporary.
(Communication Materials and Design, Inc. vs. Court of Appeals, 260 SCRA 673
[1996])
A manning agency cannot be faulted for complying with the applicable foreign law.
(Omanfil International Manpower Development Corporation vs. National Labor
Relations Commission, 300 SCRA 455 [1998]) Laureano vs. Court of Appeals, 324
SCRA 414, G.R. No. 114776 February 2, 2000
G.R. Nos. 100901-08. July 16, 1998.
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. JAILON KULAIS,
CARLOS FALCASANTOS @ “Commander Falcasantos,” AWALON KAMLON
HASSAN @ “Commander Kamlon,” MAJID SAMSON @ “Commander Bungi,”
JUMATIYA AMLANI DE FALCASANTOS, NORMA SAHIDDAN DE
KULAIS, SALVADOR MAMARIL y MENDOZA, HADJIRUL PLASIN y ALIH,
JAINUDDIN HASSAN y AHMAD, IMAM TARUK ALAH y SALIH, JALINA
HASSAN DE KAMMING, FREDDIE MANUEL @ “Ajid” and several JOHN
and JANE DOES, accused. JAILON KULAIS, accused-appellant.
Criminal Law; Constitutional Law; Right of Confrontation; Judicial Notice; As a
general rule, courts should not take judicial notice of the evidence presented in other
proceedings, even if these have been tried or are pending in the same court, or have
been heard and are actually pending before the same judge.—True, as a general rule,
courts should not take judicial notice of the evidence presented in other proceedings,
even if these have been tried or are pending in the same court, or have been heard and
are actually pending before the same judge. This is especially true in criminal cases,
where the accused has the constitutional right to confront and cross-examine the
witnesses against him.
Same; Kidnapping; The fact that the victims were detained for only three hours does
not matter if said victims are public officers.—Victims Virginia San Agustin-Gara,
Monico Saavedra and Calixto Francisco were members of the government monitoring
team abducted by appellant’s group. The three testified to the fact of kidnapping;
however, they were not able to identify the appellant. Even so, appellant’s identity as
one of the kidnappers was sufficiently established by Calunod, Bacarro and Perez, who
were with Gara, Saavedra and Francisco when the abduction occurred. That Gara,
Saavedra and Francisco were detained for only three hours does not matter. In People
vs. Domasian, the victim was similarly held for three hours, and was released even
before his parents received the ransom note. The accused therein argued that they
could not be held guilty of kidnapping as no enclosure was involved, and that only
grave coercion was committed, if at all. Convicting appellants of kidnapping or serious
illegal detention under Art. 267 (4) of the Revised Penal Code, the Court found that the
victim, an eight-year-old boy, was deprived of his liberty when he was restrained from
going home. The Court justified the conviction by holding that the offense consisted
not only in placing a person in an enclosure, but also in detaining or depriving him, in
any manner, of his liberty. Likewise, in People vs. Santos, the Court held that since the
appellant was charged and convicted under Article 267, paragraph 4, it was not the
duration of the deprivation of liberty which was important, but the fact that the victim,
a minor, was locked up.
Same; Witnesses; Alibi and Denial; Jurisprudence gives greater weight to the positive
narration of prosecution witnesses than to the negative testimonies of the defense.—
The appellant’s bare denial is a weak defense that becomes even weaker in the face of
the prosecution witnesses’ positive identification of him. Jurisprudence gives greater
weight to the positive narration of prosecution witnesses than to the negative
testimonies of the defense. Between positive and categorical testimony which has a
ring of truth to it on the one hand, and a bare denial on the other, the former generally
prevails. Jessica Calunod, Armando Bacarro and Edilberto Perez testified in a clear,
106
straightforward and frank manner; and their testimonies were compatible on material
points. Moreover, no ill motive was attributed to the kidnap victims and none was
found by this Court.
Same; Penalties; Life imprisonment is not synonymous with reclusion perpetua.—The
trial court erred when it sentenced the appellant to six terms of life imprisonment. The
penalty for kidnapping with ransom, under the Revised Penal Code, is reclusion
perpetua to death. Since the crimes happened in 1988, when the capital penalty was
proscribed by the Constitution, the maximum penalty that could have been imposed
was reclusion perpetua. Life imprisonment is not synonymous with reclusion perpetua.
Unlike life imprisonment, reclusion perpetua carries with it accessory penalties
provided in the Revised Penal Code and has a definite extent or duration. Life
imprisonment is invariably imposed for serious offenses penalized by special laws,
while reclusion perpetua is prescribed in accordance with the Revised Penal Code.
People vs. Kulais, 292 SCRA 551, G.R. Nos. 100901-08 July 16, 1998
The trial court's erroneous taking of judicial notice of a witness' testimony in another
case, also pending before it, does not affect the conviction of the appellant, whose guilt
is proven beyond reasonable doubt by other clear, convincing and overwhelming
evidence, both testimonial and documentary. The Court takes this occasion also to
remind the bench and the bar that reclusion perpetua is not synonymous with life
imprisonment.
The Case
On August 22, 1990, five Informations for kidnapping for ransom (Crim. Case Nos.
10060, 10061, 10062, 10063 and 10064) and three Informations for kidnapping (Crim
Case Nos. 10065, 10066 and 10067), all dated August 14, 1990, were filed 1 before the
Regional Trial Court of Zamboanga City against Carlos Falcasantos, Jailon Kulais,
Jumatiya Amlani, Norma Sahiddan de Kulais, Jalina Hassan de Kamming, 2 Salvador
Mamaril, Hadjirul Plasin, Jaimuddin Hassan, Imam 3 Taruk Alah, Freddie Manuel alias
"Ajid," and several John and Jane Does. The Informations for kidnapping for ransom,
which set forth identical allegations save for the names of the victims, read as follows:
That on or about the 12th day of December, 1988, in the City of Zamboanga,
Philippines, and within the jurisdiction of this Honorable Court, the above-named
accused, being all private individuals, conspiring and confederating together, mutually
aiding and assisting one another, with threats to kill the person of FELIX ROSARIO
[in Criminal Case No. 10060] 4 and for the purpose of extorting ransom from the said
Felix Rosario or his families or employer, did then and there, wilfully, unlawfully and
feloniously, KIDNAP the person of said Felix Rosario, 5 a male public officer of the
City Government of Zamboanga, who was then aboard a Cimarron vehicle with plate
No. SBZ-976 which was being ambushed by the herein accused at the highway of Sitio
Tigbao Lisomo, Zamboanga City, and brought said Felix Rosario 6 to different
mountainous places of Zamboanga City and Zamboanga del Sur, where he was
detained, held hostage and deprived of his liberty until February 2, 1989, the day when
he was released only after payment of the ransom was made to herein accused, to the
damage and prejudice of said victim; there being present an aggravating circumstance
in that the aforecited offense was committed with the aid of armed men or persons who
insure or afford impunity.
The three Informations for kidnapping, also under Article 267 of the Revised Penal
Code, likewise alleged identical facts and circumstances, except the names of the
victims:
That on or about the 12th day of December, 1988, in the City of Zamboanga and
within the jurisdiction of this Honorable Court, the above-named accused, being all
private individuals, conspiring and confederating together, mutually aiding and
assisting one another, by means of threats and intimidation of person, did then and
there, wilfully, unlawfully and feloniously KIDNAP, take and drag away and detain
the person of MONICO SAAVEDRA Y LIMEN [Criminal Case No. 10065] 7 a male
public officer of the City Government of Zamboanga, against his will, there being
present an aggravating circumstance in that the aforecited offense was committed with
the aid of armed men or persons who insure or afford impunity.
Of the twelve accused, only nine were apprehended, namely, Jailon Julais, Jumatiya
Amlani, Norma Sahiddan de Kulais, Salvador Mamaril Hadjirul Plasin, Jainuddin
Hassan, Imam Taruk Alah, Jalina Hassan and Freddie Manuel. 8
On their arraignment on September 13, 1990, all the accused pleaded not guilty. Joint
trial on the merits ensued. On April 8, 1991, Judge Pelagio S. Mandi rendered the
assailed 36-page Decision, the dispositive portion of which reads:
WHEREFORE, above premises and discussion taken into consideration, this Court
renders its judgment, ordering and finding:
1. FREDDIE MANUEL, alias "AJID" and IMAM TARUK ALAH y SALIH [n]ot
[g]uilty of the eight charges of [k]idnapping for [r]ansom and for [k]idnapping, their
guilt not having been proved beyond reasonable doubt.
Their immediate release from the City Jail, Zamboanga City is ordered, unless detained
for some other offense besides these 8 cases (Crim. Cases Nos. 10060-10067).
2. JAINUDDIN HASSAN y AHMAD, JAILON KULAIS, SALVADOR MAMARIL
y MENDOZA and HADJIRUL PLASIN y ALIH [g]uilty as principals by conspiracy
in all these 8 cases for [k]idnapping for [r]ansom and for [k]idnapping (Crim. Cases
Nos. 10060-10067).
107
Their guilt is aggravated in that they committed the 8 offenses with the aid of armed
men who insured impunity. Therefore, the penalties imposed on them shall be at their
maximum period.
WHEREFORE, for the five charges of [k]idnapping for [r]ansom, and pursuant to Art.
267 of the Revised Penal Code, five life imprisonments are imposed on Jainuddin
Hassan y Ahmad, Jailon Kulais, Salvador Mamaril y Mendoza and Kadjirul Plasin y
Alih (Crim. Cases Nos. 10060-10064).
to TEN YEARS AND ONE (1) DAY OF prision mayor as maximum (Crim. Cases
Nos. 10060-10064).
Due to the removal of the suspension of sentences of youthful offenders "convicted of
an offense punishable by death or life" by Presidential Decree No. 1179 and
Presidential Decree No. 1210 (of which [k]idnapping for [r]ansom is such an offense)
the sentences on Norma Sahiddan de Kulais and Jaliha Hussin de Kamming are NOT
suspended but must be served by them.

For kidnapping Mrs. Virginia San Agustin-Gara, a female and public officer and Januddin Hassan, Jailon Kulais, Salvador Mamaril and Hadjirul Plasin are sentenced
pursuant to Art. 267, Revised Penal Code (par. 4.), another life imprisonment is further to return the following personal effects taken on December 12, 1988, the day of
imposed on Jainuddin Hassan y Ahmad, Jailon Kulais, Salvador Mamaril y Mendoza the kidnapping, or their value in money, their liability being solidary.
and Hadjirul Plasin y Alih (Crim. Case No. 10066)
To Jessica Calunod:
For kidnapping Monico Saavedra y Limen, and Calixto Francisco y Gaspar, and their
kidnapping not having lasted more than five days, pursuant to Art. 268, Revised Penal
Code, and the Indeterminate Sentence Law, the same four accused - Jainuddin Hassan One (1) Seiko wrist watchP P 250.00
y Ahmad, Jailon Kulais, Salvador Mamaril y Mendoza and Hadjirul Plasin y Alih - are
sentenced to serve two (2) jail terms ranging from ten (10) years of prision mayor as One Bracelet P 2,400.00
minimum, to eighteen (18) years of reclusion temporal as maximum (Crim. Cases Nos.
10065 and 10067).
One Shoulder Bag P 200.00
3. JAMATIYA AMLANI DE FALCASANTOS [n]ot [g]uilty in the three charges of
[k]idnapping and she is acquitted of these charges. (Crim. Cases Nos. 10065, 10066
Cash P 200.00
and 10067).

But Jumatiya Amlani de Falcasantos is [g]uilty as accomplice in the five charges of To Armado C. Bacarro:
[k]idnapping for [r]ansom.

WHEREFORE, Jumatiya Amlani de Falcasantos is sentenced to serve five (5) One (1) wrist watch P 800.00
imprisonments, ranging from TEN (10) YEARS of prision mayor as minimum to
EIGHTEEN (18) YEARS of reclusion temporal as maximum (Crim. Cases Nos. One Necklace P 300.00
10060-1 0064).

4. NORMA SAHIDDAN DE KULAIS, 18 years old, and JALIHA HUSSIN (charged One Calculator P 295.00
as Jalina Hassan de Kamming), 15 years old, [n]ot [g]uilty in the three charges for
[k]idnapping and are, therefore, ACQUITTED of these three charges. (Crim. Cases
Eyeglasses P 500.00
Nos. 10065, 10066 & 10067).

But Norma Sahiddan de Kulais and Jalina Hussin are found [g]uilty as accomplices in One Steel Tape P 250.00
the five charges for [k]idnapping for [r]ansom. Being miners, they are entitled to the
privileged mitigating circumstance of minority which lowers the penalty imposable on
them by one degree. To Edilberto S. Perez:

WHEREFORE, Norma Sahiddan de Kulais and Jalina Hussin are sentenced to serve
One (1) Rayban P 1,000.00
five imprisonments ranging from SIX (6) YEARS of prision correccional as minimum
108

One Wrist WatchP P 1,800.00
Cash P 300.00
To Virginia San Agustin-Gara:
One (1)Wrist Watch P 850.00
 
The benefit of Art. 29, Revised Penal Code, on preventive suspension, shall be
extended to those sentenced.
The cases against Majid Samson, alias "Commander Bungi" Awalon Kamlon a.k.a.
"Commander Kamlon" Carlos Falcasantos and several "John Does" and Jane "Does"
are ARCHIVED until their arrest.
Costs against the accused convicted.
9
SO ORDERED. 
On May 7, 1991, Jailon Kulais, Jumatiya Amlani de Falcasantos, Norma Sahiddan de
Kulais and Jaliha Hussin filed their joint Notice of Appeal. 10 In a letter dated February
6, 1997, the same appellants, except Jailon Kulais, withdrew their appeal because of
their application for "amnesty." In our March 19, 1997 Resolution, we granted their
motion. Hence, only the appeal of Kulais remains for the consideration of this Court. 11
The Facts
The Version of the Prosecution
The solicitor general summarized, in this wise, the facts as viewed by the People:
On December 12, 1988, a group of public officials from various government agencies,
organized themselves as a monitoring team to inspect government projects in
Zamboanga City. The group was composed of Virginia Gara, as the head of the team;
Armando Bacarro, representing the Commission on Audit; Felix del Rosario,
representing the non-government: Edilberto Perez, representing the City Assessor's
Office; Jessica Calunod and Allan Basa of the City Budget Office and Monico
Saavedra, the driver from the City Engineer's Office. (p. 3, TSN, October 22, 1990.)
On that particular day, the group headed to the Lincomo Elementary School to check
on two of its classrooms. After inspecting the same, they proceeded to the Talaga
Footbridge. The group was not able to reach the place because on their way, they were
stopped by nine (9) armed men who pointed their guns at them (p. 4, TSN, ibid.).
The group alighted from their Cimarron jeep where they were divested of their
personal belongings. They were then ordered to walk to the mountain by the leader of
the armed men who introduced himself as Commander Falcasantos (p. 5, TSN, ibid.).
While the group was walking in the mountain, they encountered government troops
which caused their group to be divided. Finally, they were able to regroup themselves.
Commander Kamlon with his men joined the others. (pp. 7-8, TSN, ibid.).
The kidnappers held their captives for fifty-four (54) days in the forest. During their
captivity, the victims were able to recognize their captors who were at all times armed
with guns. The wives of the kidnappers performed the basic chores like cooking. (pp.
9-10. TSN, ibid.)
Commander Falcasantos also ordered their victims to sign the ransom notes which
demanded a ransom of P100,000.00 and P14,000.00 in exchange for twenty (20) sets
of uniform. (p. 15, TSN, ibid.)
On February 3, 1989, at around 12:00 o'clock noontime, the victims were informed
that they would be released. They started walking until around 7:00 o'clock in the
evening of that day. At around 12:00 o'clock midnight, the victims were released after
Commander Falcasantos and Kamlon received the ransom money. (p. 19, TSN, ibid.)
The total amount paid was P122,000.00. The same was reached after several
negotiations between Mayor Vitaliano Agan of Zamboanga City and the
representatives of the kidnappers. (pp. 2, 6, TSN, Nov. 11, 1990)
. . . 12
The prosecution presented fifteen witnesses, including some of the kidnap victims
themselves: Jessica Calunod, Armando Bacarro, Edilberto Perez, Virginia San
Agustin-Gara, Calixto Francisco, and Monico Saavedra.
The Version of the Defense
The facts of the case, according to the defense, are as follows: 13
On May 28, 1990, at about 10:00 o'clock in the morning, while weeding their farm in
Sinaburan, Zamboanga del Sur, accused-appellant Jumatiya Amlani was picked up by
soldiers and brought to a place where one army battalion was stationed. Thereat, her
five (5) co-accused, namely Salvador Mamaril, Hadjirul Plasin, Jainuddin Hassin,
Imam Taruk Alah and Freddie Manuel were already detained. In the afternoon of the
same day, appellants spouses Jailon Kulais and Norma Sahiddan were brought to the
109
battalion station and likewise detained thereat. On May 30, 1990, the eight (8) accused
were transported to Metrodiscom, Zamboanga City. Here on the same date, they were
joined by accused-appellant Jaliha Hussin.
At the time Amlani was picked up by the military, she had just escaped from the
captivity of Carlos Falcasantos and company who in 1988 kidnapped and brought her
to the mountains. Against their will, she stayed with Falcasantos and his two wives for
two months, during which she slept with Falcasantos as aide of the wives and was
made to cook food, wash clothes, fetch water and run other errands for everybody. An
armed guard was assigned to watch her, so that, for sometime, she had to bear the ill-
treatment of Falcasantos' other wives one of whom was armed. After about two
months, while she was cooking and Falcasantos and his two wives were bathing in the
river, and while her guard was not looking, she took her chance and made a successful
dash for freedom. (TSN, January 29, 1992, pp. 2-15)
Likewise a kidnap victim herself is accused-appellant Jaliha Hussin, who was thirteen
years old at the time (she was fifteen years old when the trial of the instant cases
commenced). She was kidnapped by Daing Kamming and brought to the mountains
where he slept with her. She stayed with him for less than a month sleeping on forest
ground and otherwise performing housekeeping errands for Kamming and his men.
She made good her escape during an encounter between the group of Kamming and
military troops. She hid in the bushes and came out at Ligui-an where she took a
"bachelor" bus in going back to her mother's house at Pudos, Guiligan, Tungawan,
Zamboanga del Sur. One day, at around 2:00 o'clock in the afternoon, while she was
harvesting palay at the neighboring village of Tigbalangao, military men picked her up
to Ticbanuang where there was an army battalion detachment. From Ticbawuang, she
was brought to Vitali, then to Metrodiscom, Zamboanga City, where on her arrival, she
met all the other accused for the first time except Freddie Manuel. (Ibid., pp. 16-21)
Another female accused is appellant Norma Sahiddan, a native of Sinaburan,
Tungawan, Zamboanga del Sur. At about 3:00 o'clock in the afternoon of a day in
May, while she and her husband were in their farm, soldiers arrested them. The
soldiers did not tell them why they were being arrested, neither were they shown any
papers. The two of them were just made to board a six by six truck. There were no
other civilians in the truck. The truck brought the spouses to the army battalion and
placed them inside the building where there were civilians and soldiers. Among the
civilians present were her six co-accused Hadjirul Plasin, Salvador Mamaril,
Jaimuddin Hassan, Ima[m] Taruk Alah, Freddie Manuel and Jumatiya Amlani. That
night, the eight of them were brought to Tictapul, Zamboanga City; then to Vitali; and,
finally, to the Metrodiscom, Zamboanga City where they stayed for six days and six
nights. On the seventh day, the accused were brought to the City Jail, Zamboanga City.
(TSN, January 30, 1991, pp. 6-11)
The husband of Norma Sahiddan is Jailon Kulais who, as heretofore narrated, was
arrested with his wife the day the soldiers came to their farm on May 28, 1990. He has
shared with his wife the ordeals that followed in the wake of their arrest and in the
duration of their confinement up to the present. (TSN, January 22, 1991 pp. 2-4).
The Trial Court's Ruling
The trial court found Appellant Kulais guilty of five counts of kidnapping for ransom
and one count of kidnapping a woman and public officer, for which offenses it
imposed upon him six terms of "life imprisonment." It also found him guilty of two
counts of slight illegal detention for the kidnapping of Monico Saavedra and Calixto
Francisco. The trial court ratiocinated as follows:
Principally, the issue here is one of credibility - both of the witnesses and their version
of what had happened on December 12, 1988, to February 3, 1989. On this pivotal
issue, the Court gives credence to [p]rosecution witnesses and their testimonies.
Prosecution evidence is positive, clear and convincing. No taint of evil or dishonest
motive was imputed or imputable to [p]rosecution witnesses. To this Court, who saw
all the witnesses testify, [p]rosecution witnesses testified only because they were
impelled by [a] sense of justice, of duty and of truth.
Contrarily, [d]efense evidence is weak, uncorroborated and consisted only of alibis.
The individual testimonies of the nine accused dwel[t] principally on what happened to
each of them on May 27, 28 and 29, 1990. None of the accused explained where he or
she was on and from December 12, 1988, to February 3, 1989, when [p]rosecution
evidence show[ed] positively seven of the nine accused were keeping the five or six
hostages named by [p]rosecution evidence.
The seven accused positively identified to have been present during the course of the
captivity of the five kidnap-victims-complainants are: (1) Jumatiya Amlani; (2) Jaliha
Hussin; (3) Norma Sahiddan; (4) Jailon Kulais; (5) Hadjirul Plasin; (6) Salvador
Mamaril and (7) Jainuddin Hassan.
The two accused not positively identified are: Freddie Manuel alias "Ajid", and Imam
Taruk Alah. These two must, therefore, be declared acquitted based on reasonable
doubt.
The next important issue to be examined is: Are these seven accused guilty as
conspirators as charged in the eight Informations; or only as accomplices? Prosecution
evidence shows that the kidnapping group to which the seven accused belonged had
formed themselves into an armed band for the purpose of kidnapping for ransom. This
armed band had cut themselves off from established communities, lived in the
mountains and forests, moved from place to place in order to hide their hostages. The
wives of these armed band moved along with their husbands, attending to their needs,
110
giving them material and moral support. These wives also attended to the needs of the
kidnap victims, sleeping with them or comforting them.
xxx xxx xxx
II The guilt of Jainuddin Hassan, Jailon Kulais, Salvador Mamaril and Hadjirul
Plasin. The Court holds these four men guilty as conspirators in the 8 cases of
kidnapping. Unlike the three women-accused, these male accused were armed. They
actively participated in keeping their hostages by fighting off the military and
CAFGUS, in transferring their hostages from place to place, and in guarding the
kidnap hostages. Salvador Mamaril and Jailon Kulais were positively identified as
among the nine armed men who had kidnapped the eight kidnap victims on December
12, 1988.
The higher degree of participation found by the Court of the four accused is supported
by the rulings of our Supreme Court quoted below.
(1) The time-honored jurisprudence is that direct proof is not essential to prove
conspiracy. It may be shown by a number of infinite acts, conditions and
circumstances which may vary according to the purposes to be accomplished and from
which may logically be inferred that there was a common design, understanding or
agreement among the conspirators to commit the offense charged. (People vs. Cabrera,
43 Phil 64; People vs. Carbonel, 48 Phil. 868.)
(2) The crime must, therefore, in view of the solidarity of the act and intent which
existed between the sixteen accused, be regarded as the act of the band or party created
by them, and they are all equally responsible for the murder in question. (U.S. vs.
Bundal, et. al. 3 Phil 89, 98.)
(3) When two or more persons unite to accomplish a criminal object, whether through
the physical volition of one, or all, proceeding severally or collectively, each individual
whose evil will actively contribute to the wrongdoing is in law responsible for the
whole, the same as though performed by himself alone. (People vs. Peralta, et. al. 25
SCRA 759, 772 (1968).) 14
The Assigned Errors
The trial court is faulted with the following errors, viz:
I in other proceedings, even if these have been tried or are pending in the same court, or
The trial court erred in taking judicial notice of a material testimony given in another
case by Lt. Melquiades Feliciano, who allegedly was the team leader of the
government troops which allegedly captured the accused-appellants in an encounter;
thereby, depriving the accused-appellants their right to cross-examine him.
II
On the assumption that Lt. Feliciano's testimony could be validly taken judicial notice
of, the trial court, nevertheless, erred in not disregarding the same for being highly
improbable and contradictory.
III
The trial court erred in finding that accused-appellants Jumatiya Amlani, Jaliha Hussin
and Norma Sahiddan provided Carlos Falcasantos, et. al., with material and moral
comfort, hence, are guilty as accomplices in all the kidnapping for ransom cases.
IV
The trial court erred in denying to accused-appellant Jaliha Hussin and Norma
Sahiddan the benefits of suspension of sentence given to youth offenders considering
that they were minors at the time of the commission of the offense. 15
As earlier noted, Jumatiya Amlani, Jaliha Hussin and Norma Sahiddan had withdrawn
their appeal, and as such, the third and fourth assigned errors, which pertain to them
only, will no longer be dealt with. Only the following issues pertaining to Appellant
Jailon Kulais will be discussed: (1) judicial notice of other pending cases, (2)
sufficiency of the prosecution evidence, and (3) denial as a defense. In addition, the
Court will pass upon the propriety of the penalty imposed by the trial court.
The Court's Ruling
The appeal is bereft of merit.
First Issue:
Judicial Notice and Denial of Due Process
Appellant Kulais argues that he was denied due process when the trial court took
judicial notice of the testimony given in another case by one Lt. Melquiades Feliciano,
who was the team leader of the government troops that captured him and his purported
cohorts. 16 Because he was allegedly deprived of his right to cross-examine a material
witness in the person of Lieutenant Feliciano, he contends that the latter's testimony
should not be used against him. 17
True, as a general rule, courts should not take judicial notice of the evidence presented
have been heard and are actually pending before the same judge. 18 This is especially
111
true in criminal cases, where the accused has the constitutional right to confront and A Pagal and his wife; Tangkong and his wife Nana; the two (2) wives of Commander
cross-examine the witnesses against him. Falcasantos - Mating and Janira - another brother in-law of Commander Kamlon,
Usman, the wife of Kamlon, Tira.
Having said that, we note, however, that even if the court a quo did take judicial notice
of the testimony of Lieutenant Feliciano, it did not use such testimony in deciding the xxx xxx xxx
cases against the appellant. Hence, Appellant Kulais was not denied due process. His
conviction was based mainly on the positive identification made by some of the kidnap Q Now, you said that you were with these men for fifty-four days and you really came
victims, namely, Jessica Calunod, Armando Bacarro and Edilberto Perez. These to know them. Will you still be able to recognize these persons if you will see the[m]
witnesses were subjected to meticulous cross-examinations conducted by appellant's again?
counsel. At best, then, the trial court's mention of Lieutenant Feliciano's testimony is a A Yes, ma'am.
decisional surplusage which neither affected the outcome of the case nor substantially
prejudiced Appellant Kulais. Q Now will you look around this Honorable Court and see if any of those you
mentioned are here?
Second Issue:
A Yes, they are here.
Sufficiency of Prosecution Evidence
Q Some of them are here?
Appellant was positively identified by Calunod, as shown by the latter's testimony:
A Some of them are here.
CP CAJAYON D MS:
xxx xxx xxx
Q And how long were you in the custody of these persons?
Q Where is Tangkong? What is he wearing?
A We stayed with them for fifty-four days.
A White t-shirt with orange collar. (witness pointing.) He was one of those nine armed
Q And during those days did you come to know any of the persons who were with the men who took us from the highway.
group?
RTC INTERPRETER:
A We came to know almost all of them considering we stayed there for fifty-four days.
Witness pointed to a man sitting in court and when asked of his name, he gave his
Q And can you please name to us some of them or how you know them? name as JAILON KULAIS.
A For example, aside from Commander Falcasantos and Commander Kamlon we came CP CAJAYON D MS:
to know first our foster parents, those who were assigned to give us some food.
Q Aside from being with the armed men who stopped the vehicle and made you alight,
Q You mean to say that the captors assigned you some men who will take care of you? what else was he doing while you were in their captivity?
A Yes. A He was the foster parent of Armando Bacarro and the husband of Nana.
Q And to whom were you assigned? COURT:
A To Ila Abdurasa. Q Who?
Q And other than your foster [parents] or the parents whom you are assigned to, who A Tangkong.
else did you come to know?
xxx xxx xxx 19

Likewise clear and straightforward was Bacarro's testimony pointing to appellant as

one of the culprits:
112
FISCAL CAJAYON: Q And because Tangkong was always with you as your host even if he did not tell you
that he [was] one of those who stopped you, you would not recognize him?
xxx xxx xxx
A No, I can recognize him because he was the one who took my shoes.
Q And what happened then?
COURT:
A Some of the armed men assigned who will be the host or who will be the one [to]
g[i]ve food to us. Q Who?

Q [To] whom were you assigned? A Tangkong, your Honor.

A I was assigned to a certain Tangkong and [his] wife Nana. xxx xxx xxx 20

xxx xxx xxx Also straightforward was Ernesto Perez' candid narration:

Q Now, you said you were assigned to Tangkong and his wife. [D]o you remember FISCAL CAJAYON:
how he looks like?
xxx xxx xxx
A Yes.
Q Who else?
Q Now, will you please look around this Court and tell us if that said Tangkong and his
wife are here? A The last man.

A Yes, ma'am. Q Did you come to know his name?

Q Could you please point this Tangkong to us? A Only his nickname, Tangkong. (Witness pointed to a man in Court who identified
himself as Jailon Kulais.)
A Witness pointed to a person in Court. [W]hen asked his name he identified [himself]
as Jailon Kulais. Q And what was Tangkong doing in the mountain?

Q Why did you say his name is Tangkong? Where did you get that name? A The same, guarding us.

A Well, that is the name [by which he is] usually called in the camp. CROSS-EXAMINATION BY ATTY. SAHAK.

xxx xxx xxx Q Engr. Perez, you stated that you were ambushed by nine armed men on your way
from [the] Licomo to [the] Talaga Foot Bridge. [W]hat do you mean by ambushed?
ATTY. FABIAN (counsel for accused Kulais)
A I mean that they blocked our way and stopped.
Q When did you first meet Tangkong?
Q They did not fire any shots?
A That was on December 11, because I remember he was the one who took us.
A But they were pointing their guns at us.
Q When you were questioned by the fiscal a while ago, you stated that Mr. Mamaril
was one of those who stopped the bus and took you to the hill and you did not mention Q And among the 9 armed men who held you on your way to [the] Talaga Footbridge,
Tangkong? you stated [that] one of them [was] Commander Falcasantos?

A I did not mention but I can remember his face. A Yes.

xxx xxx xxx Q Could you also recognize anyone of the accused in that group?

A Yes.
113
Q Will you please identify?
A That one, Tangkong. (The witness pointed to a man sitting in court who identified
himself as Jailon Kulais.)
xxx xxx xxx
CROSS-EXAMINATION BY ATTY. FABIAN.
Q You said Jailon Kulais was among those who guarded the camp?
FISCAL CAJAYON:
Your Honor, please, he does not know the name of Julais, he used the word Tangkong.
ATTY. FABIAN
Q You said Tangkong guarded you[. W]hat do you mean?
A He guarded us like prisoners[. A]fter guarding us they have their time two hours
another will be on duty guarding us.
Q Where did you meet Tangkong?
A He was one of the armed men who kidnapped us.
xxx xxx xxx  21
It is evident from the foregoing testimonies of Calunod, Bacarro and Perez that
kidnapping or detention did take place: the five victims were held, against their will,
for fifty-three days from December 12, 1988 to February 2, 1989. It is also evident that
Appellant Kulais was a member of the group of armed men who staged the
kidnapping, and that he was one of those who guarded the victims during the entire
period of their captivity. His participation gives credence to the conclusion of the trial
court that he was a conspirator.
Kidnapping
for Ransom
That the kidnapping of the five was committed for the purpose of extorting ransom is
also apparent from the testimony of Calunod, who was quite emphatic in identifying
the accused and narrating the circumstances surrounding the writing of the ransom
letters.
CP CAJAYON D MS:
Q Now, you were in their captivity for 54 days and you said there were these meetings
for possible negotiation with the City Government. What do you mean by this? What
were you supposed to negotiate?
A Because they told us that they will be releasing us only after the terms. 22
Q And what were the terms? Did you come to know the terms?
A I came to know the terms because I was the one ordered by Commander
Falcasantos to write the letter, the ransom letter.
Q At this point of time, you remember how many letters were you asked to write for
your ransom?
A I could not remember as to how many, but I can identify them.
Q Why will you able to identify the same?
A Because I was the one who wrote it.
Q And you are familiar, of course, with your penmanship?
A Yes.
Q Now we have here some letters which were turned over to us by the Honorable City
Mayor Vitaliano Agan. 1,2,3,4,5 - there are five letters all handwritten.
COURT:
Original?
CP CAJAYON D MS:
Original, your Honor.
Q And we would like you to go over these and say, tell us if any of these were the ones
you were asked to write.
A (Witness going over [letters])
This one - 2 pages. This one - 2 pages. No more.
Q Aside from the fact that you identified your penmanship in these letters, what else
will make you remember that these are really the ones you wrote while there?
A The signature is there.
Q There is a printed name here[,] Jessica Calunod.
A And over it is a signature.
114
Q That is your signature?
A Yes, ma'am.
Q How about in the other letter, did you sign it also?
A Yes, there is the other signature.
Q There are names - other names here - Eddie Perez, Allan Basa, Armando Bacarro,
Felix Rosario, Jojie Ortuoste and there are signatures above the same. Did you come
up to know who signed this one?
A Those whose signatures there were signed by the persons. [sic].
Q And we have here at the bottom, Commander Kamlon Hassan, and there is the
signature above the same. Did you come to know who signed it?
A [It was] Commander Kamlon Hassan who signed that.
xxx xxx xxx
Q Jessica, I am going over this letter . . . Could you please read to us the portion here
which says the terms? . . .
A (Witness reading) "Mao ilang gusto nga andamun na ninyo ang kantidad nga
P100,000 ug P14,000 baylo sa 20 sets nga uniforms sa Biyernes (Pebrero 3, 1989). 23
INTERPRETER (Translation):
This is what they like you to prepare[:] the amount of P100,000.00 and P14,000.00 in
exchange [for] 20 sets of uniform on Friday, February 3, 1989.
xxx xxx xxx
Q Now you also earlier identified this other letter and this is dated January 21,
1988. 24 Now, could you please explain to us why it is dated January 21, 1988 and the
other one Enero 31, 1989 or January 31, 1989?
A I did not realize that I placed 1989, 1988, but it was 1989.
Q January 21, 1989?
A Yes.
xxx xxx xxx
Q Now, in this letter, were the terms also mentioned?
Please go over this.
A (Going over the letter)
Yes, ma'am.
Q Could you please read it aloud to us?
A (Witness reading)
Gusto nila and P100,000.00 ng kapinan nu ug 20 sets nga completong uniformer (7
colors marine type wala nay labot ang sapatos), tunga medium ug tunga large size. 25
INTERPRETER:
They like the P100,000.00 and an addition of 20 sets of complete uniform (7 colors,
marine-type not including the shoes), one half medium, one half large.
xxx xxx xxx
Q After having written these letters, did you come to know after [they were] signed by
your companions and all of you, do you know if these letters were sent? If you know
only.
A I would like to make it clear. The first letter was ordered to me by Falcasantos to
inform the City Mayor that initial as P500,000.00, and when we were already - I was
asked again to write, we were ordered to affix our signature to serve as proof that all of
us are alive. 26 [sic]
Calunod's testimony was substantially corroborated by both Armando Bacarro 27 and
Edilberto Perez. 28 The receipt of the ransom letters, the efforts made to raise and
deliver the ransom, and the release of the hostages upon payment of the money were
testified to by Zamboanga City Mayor Vitaliano Agan 29 and Teddy Mejia. 30
The elements of kidnapping for ransom, as embodied in Article 267 of the Revised
Penal Code, 31 having been sufficiently proven, and the appellant, a private individual,
having been clearly identified by the kidnap victims, this Court thus affirms the trial
court's finding of appellant's guilt on five counts of kidnapping for ransom.
Kidnapping of
Public Officers
Victims Virginia San Agustin-Gara, Monico Saavedra and Calixto Francisco were
members of the government monitoring team abducted by appellant's group. The three
testified to the fact of kidnapping; however, they were not able to identify the
appellant. Even so, appellant's identity as one of the kidnappers was sufficiently
established by Calunod, Bacarro and Perez, who were with Gara, Saavedra and
Francisco when the abduction occurred.
115
That Gara, Saavedra and Francisco were detained for only three hours 32 does nor
matter. In People vs. Domasian, 33 the victim was similarly held for three hours, and
was released even before his parents received the ransom note. The accused therein
argued that they could not be held guilty of kidnapping as no enclosure was involved,
and that only grave coercion was committed, if at all. 34 Convicting appellants of
kidnapping or serious illegal detention under Art. 267 (4) of the Revised Penal Code,
the Court found that the victim, an eight-year-old boy, was deprived of his liberty
when he was restrained from going home. The Court justified the conviction by
holding that the offense consisted not only in placing a person in an enclosure, but also
in detaining or depriving him, in any manner, of his liberty. 35 Likewise, in People vs.
Santos, 36 the Court held that since the appellant was charged and convicted under
Article 267, paragraph 4, it was not the duration of the deprivation of liberty which
was important, but the fact that the victim, a minor, was locked up.
Thus, in the present case, the detention of Gara, Saavedra and Francisco for only a few
hours is immaterial. The clear fact is that the victims were public officers 37 - Gara was
a fiscal analyst for the City of Zamboanga, Saavedra worked at the City Engineer's
Office, and Francisco was a barangay councilman at the time the kidnapping occurred.
Appellant Kulais should be punished, therefore, under Article 267, paragraph 4 of the
Revised Penal Code, and not Art, 268, as the trial court held.
The present case is different from People vs. Astorga, 38 which held that the crime
committed was not kidnapping under Article 267, paragraph 4, but only grave
coercion. The appellant in that case had tricked his seven-year-old victim into going
with him to a place he alone knew. His plans, however, were foiled when a group of
people became suspicious and rescued the girl from him. The Court noted that the
victim's testimony and the other pieces of evidence did not indicate that the appellant
wanted to detain her, or that he actually detained her.
In the present case, the evidence presented by the prosecution indubitably established
that the victims were detained, albeit for a few hours. There is proof beyond reasonable
doubt that kidnapping took place, and that appellant was a member of the armed group
which abducted the victims.
Third Issue:
Denial and Alibi
The appellant's bare denial is a weak defense that becomes even weaker in the face of
the prosecution witnesses' positive identification of him. Jurisprudence gives greater
weight to the positive narration of prosecution witnesses than to the negative
testimonies of the defense. 39 Between positive and categorical testimony which has a
ring of truth to it on the one hand, and a bare denial on the other, the former generally
prevails. 40 Jessica Calunod, Armando Bacarro and Edilberto Perez testified in a clear,
straightforward and frank manner; and their testimonies were compatible on material
points. Moreover, no ill motive was attributed to the kidnap victims and none was
found by this Court.
We agree with the trial court's observation that the appellant did not meet the charges
against him head on. His testimony dwelt on what happened to him on the day he was
arrested and on subsequent days thereafter. Appellant did not explain where he was
during the questioned dates (December 12, 1988 to February 3, 1989); neither did he
rebut Calunod, Bacarro and Perez, when they identified him as one of their kidnappers.
Reclusion Perpetua, Not Life Imprisonment
The trial court erred when it sentenced the appellant to six terms of life imprisonment.
The penalty for kidnapping with ransom, under the Revised Penal Code, is reclusion
perpetua to death. Since the crimes happened in 1988, when the capital penalty was
proscribed by the Constitution, the maximum penalty that could have been imposed
was reclusion perpetua. Life imprisonment is not synonymous with reclusion
perpetua. Unlike life imprisonment, reclusion perpetua carries with it accessory
penalties provided in the Revised Penal Code and has a definite extent or duration. Life
imprisonment is invariably imposed for serious offenses penalized by special laws,
while reclusion perpetua is prescribed in accordance with the Revised Penal Code. 41
WHEREFORE, the conviction of Appellant Jailon Kulais as principal in five counts of
kidnapping for ransom and in three counts of kidnapping is AFFIRMED, but the
penalty imposed is hereby MODIFIED as follows: Appellant is sentenced to five terms
of reclusion perpetua, one for each of his five convictions for kidnapping for ransom;
and to three terms of reclusion perpetua, one each for the kidnapping of Public
Officers Virginia Gara, Monico Saavedra and Calixto Francisco. Like the other
accused who withdrew their appeals, he is REQUIRED to return the personal effects,
or their monetary value, taken from the kidnap victims. Additionally, he is ORDERED
to pay the amount of P122,000 representing the ransom money paid to the kidnappers.
Costs against appellant.
SO ORDERED.
Notes--When the prosecution’s cause is weak, an accused’s alibi assumes importance
and becomes crucial in negating his criminal liability, and his alibi should be
considered for there are times where an accused has no other possible defense but alibi,
as that could really be the truth. (People vs. Adofina, 239 SCRA 67 [1994])
The exception to the right of confrontation contemplated by law covers only the
utilization of testimonies of absent witnesses made in previous proceedings, and does
not include utilization of previous decisions or judgments. (People vs. Ortiz-Miyake,
279 SCRA 180 [1997]) People vs. Kulais, 292 SCRA 551, G.R. Nos. 100901-08 July
16, 1998
116
 RULE 129 Sec.4
JUDICIAL ADMISSION
G.R. No. 74336. April 7, 1997.
J. ANTONIO AGUENZA, petitioner, vs. METROPOLITAN BANK & TRUST
CO., VITALIADO P. ARRIETA, LILIA PEREZ, PATRICIO PEREZ and THE
INTERMEDIATE APPELLATE COURT, respondents.
Remedial Law; Pleadings and Practice; Rule that the allegations, statements, or
admissions contained in a pleading are conclusive as against the pleader is not an
absolute and inflexible rule and is subject to exceptions.—The general rule that “the
allegations, statements, or admissions contained in a pleading are conclusive as against
the pleader” is not an absolute and inflexible rule and is subject to exceptions.
Same; Same; An admission in a pleading on which a party goes to trial may be
contradicted by showing that it was made by improvidence or mistake or that no such
admission was made.—In other words, an admission in a pleading on which a party
goes to trial may be contradicted by showing that it was made by improvidence or
mistake or that no such admission was made, i.e., “not in the sense in which the
admission was made to appear or the admission was taken out of context.”
Same; Same; In the absence of such ratification or authority, such admission does not
bind the corporation.—In any event, assuming arguendo that the responsive pleading
did contain the aforesaid admission of corporate liability, the same may not still be
given effect at all. As correctly found by the trial court, the alleged admission made in
the answer by the counsel for Intertrade was “without any enabling act or attendant
ratification of corporate act,” as would authorize or even ratify such admission. In the
absence of such ratification or authority, such admission does not bind the corporation.
Same; Same; Ratification can never be made on the part of the corporation by the same
persons who wrongfully assume the power to make the contract, but the ratification
must be by the officer as governing body having authority to make such contract.—
The respondent appellate court likewise adjudged Intertrade liable because of the two
letters emanating from the office of Mr. Arrieta which the respondent court considered
“as indicating the corporate liability of the corporation.” These documents and
admissions cannot have the effect of a ratification of an unauthorized act. As we
elucidated in the case of Vicente v. Geraldez, “ratification can never be made on the
part of the corporation by the same persons who wrongfully assume the power to make
the contract, but the ratification must be by the officer as governing body having
authority to make such contract.” In other words, the unauthorized act of respondent
Arrieta can only be ratified by the action of the Board of Directors and/or petitioner
Aguenza jointly with private respondent Arrieta. Aguenza vs. Metropolitan Bank &
Trust Co., 271 SCRA 1, G.R. No. 74336 April 7, 1997
Before us is a petition for review on certiorari seeking the reversal of the Decision1 of
the Intermediate Appellate Court (now the Court of Appeals) 2 finding petitioner J.
Antonio Aguenza liable under a continuing surety agreement to pay private respondent
Metropolitan Bank & Trust Company (hereafter, Metrobank) a loan jointly obtained by
the General Manager and a bookkeeper of Intertrade a corporation of which petitioner
is President and in whose behalf petitioner had, in the past, obtained credit lines.
The following facts are not disputed:
On February 28, 1977, the Board of Directors of Intertrade, through a Board
Resolution, authorized and empowered petitioner and private respondent Vitaliado
Arrieta, Intertrade's President and Executive Vice-President, respectively, to jointly
apply for and open credit lines with private respondent Metrobank. Pursuant to such
authority, petitioner and private respondent Arrieta executed several trust receipts from
May to June, 1977, the aggregate value of which amounted to P562,443.46, with
Intertrade as the entrustee and private respondent Metrobank as the entruster.
On March 14, 1977, petitioner and private respondent Arrieta executed a Continuing
Suretyship Agreement whereby both bound themselves jointly and severally with
Intertrade to pay private respondent Metrobank whatever obligation Intertrade incurs,
but not exceeding the amount P750,000.00.
In this connection, private respondent Metrobank's Debit Memo to Intertrade dated
March 22, 1978 showed full settlement of the letters of credit covered by said trust
receipts in the total amount P562,443.46.
On March 21, 1978, private respondents Arrieta and Lilia P. Perez, bookkeeper in the
employ of Intertrade, obtained P500,000.00 loan from private respondent Metrobank.
Both executed Promissory Note in favor or said bank in the amount of P500,000,00.
Under said note, private respondents Arrieta and Perez promised to pay said amount,
jointly and severally, in twenty five (25) equal installments of P20,000.00 each starting
on April 20, 1979 with interest of 18.704% per annum, and in case of default, a further
8 % per annum.
Private respondents Arrieta and Perez defaulted in the payment of several installments
thus resulting in the entire obligation becoming due and demandable. In 1979, private
respondent Metrobank instituted suit against Intertrade, Vitaliado Arrieta, Lilia Perez
and her husband, Patricio Perez, to collect not only the unpaid principal obligation, but
also interests, fees and penalties, exemplary damages, as well as attorney's fees and
costs of suit.
117
More than a year after private respondent Metrobank filed its original complaint, it
filed an Amended Complaint dated August 30, 1980 for the sole purpose of impleading
petitioner as liable for the loan made by private respondents Arrieta and Perez on
March 21, 1978, notwithstanding the fact that such liability is being claimed on
account of a Continuing Suretyship Agreement dated March 14, 1977 executed by
petitioner and private respondent Arrieta especifically to guarantee the credit line
applied for by and granted to, Intertrade, through petitioner and private respondent
Arrieta who were specially given authority by Intertrade on February 28, 1977 to open
credit lines with private respondent Metrobank. The obligations incurred by Intertrade
under such credit lines were completely paid as evidenced by private respondent
Metrobank's debit memo in the full amount of P562,443.46.
After hearing on the merits, the trial court rendered its decision absolving petitioner
from liability and dismissing private respondent Metrobank's complaint against him,
the dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered as follows:
1) Declaring that the Promissory Note dated March 21, 1978, marked as Exhibit A is
the responsibility only of defendant Vitaliado P. Arrieta and Lilia P. Perez, in their
personal capacity and to the exclusion of defendant Intertrade and Marketing Co., Inc.;
2) Ordering defendants Vitaliado P. Arrieta and Lilia P. Perez to pay, jointly and
severally, the plaintiff the sum of P1,062,898.92, due, of September 15, 1982, plus
interest, fees and penalties due from that date pursuant to the stipulations in the
promissory note until the whole obligations shall have been paid and finally settled;
3) Ordering defendants Vitaliado P. Arrieta and Lilia Perez to pay, jointly and
severally, the plaintiff the sum of P44,000.00 by way of attorney's fees and other
litigation expenses, albeit there is no award for exemplary damages;
4) Declaring defendant Patricio Perez, as conjugal partner of defendant Lilia Perez, as
jointly and severally liable with her for what the latter is ordered to pay per this
Decision;
5) Dismissing this case insofar as defendants Intertrade and Marketing Co., Inc. and J.
Antonio Aguenza are concerned, although their respective counterclaims against the
plaintiff are also ordered dismissed.
Costs of suit shall be paid, jointly and severally, by defendant Vitaliado Arrieta and
Lilia Perez.
3 words "operating capital" refer to the capital requirements of Perez and Arrieta. In the
SO ORDERED.
Private respondents Arrieta and spouses Perez appealed the foregoing decision to the
respondent Court of Appeals.
On February 11, 1986, respondent appellate court promulgated the herein assailed
decision, the dispositive portion of which reads:
WHEREFORE, the appealed decision is SET ASIDE and another one entered ordering
Intertrade & Marketing Co., Inc., and J. Antonio Aguenza, jointly and severally:
1) to pay the Bank the principal of P440,000.00 plus its interest of 18.704% per
annum computed from April 15, 1979 until full payment;
2) to pay the Bank the sum equivalent to 8% of P440,000.00 as penalty, computed
from July 19, 1978 until full payment;
3) to pay the Bank the sum of P15,000.00 as attorney's fees.
The complaint is dismissed as against Lilia Perez, Patricio Perez and Vitaliado P.
Arrieta who are absolved from liability.
All counterclaims are dismissed.
Costs against Intertrade and Aguenza, jointly and severally.
SO ORDERED.
In setting aside the decision of the trial court, respondent Court of Appeals ratiocinated
such reversal in this wise:
No dispute exists as to the promissory note and the suretyship agreement. The
controversy centers on whether the note was a corporate undertaking and whether the
suretyship agreement covered the obligation in the note.
As far as Intertrade is concerned, it seems clear from its answer that the loan evidenced
by the note was a corporate liability. Paragraph 1.3 of the answer admits ". . .
defendant's obtention of the loan from the plaintiff . . ."; the affirmative defenses admit
default, and invoking the defense of usury, plead adjustment of excessive interest
which Intertrade refused to make.
On the basis of this admission, it is no longer in point to discuss, as the appealed
decision does, the question of the capacity in which Arrieta and Perez signed the
promissory note, Intertrade's admission of its corporate liability being admission also
that the signatories signed the note in a representative capacity. The Bank itself gave
corroboration with its insistence on Intertrade's liability under the note. . .
The stated purpose of the note is "operating capital." It cannot be contended that the
first place, it was not shown that they were in business for themselves. Besides, Perez
was only a bookkeeper of Intertrade with a salary of P800.00 a month . . . Their
combined resources would not have been sufficient to justify a business loan of the
118
note's magnitude. From these follows the only logical conclusion: that Arrieta and the
Perez spouses are not liable on the note.
The surety agreement presents a different problem.
There is no question that Aguenza signed the agreement . . . Its second paragraph
shows, typewritten in bold capitals, that the agreement was executed "for and in
consideration of any existing indebtedness to the Bank of INTERTRADE &
MARKETING COMPANY, INC." Nowhere in its entire text is it shown that its
execution was for the benefit of Perez or Arrieta.
Aguenza feigns ignorance of the promissory note and claims his knowledge of it came
only when he received summons. This is difficult to believe. As Intertrade's first letter
to the Bank . . . shows, the Board of Directors and principal stockholders met to
discuss the obligation. Aguenza was at the time president of Intertrade and acting
chairman of its board . . .
Aguenza also argues that the suretyship was executed to enable Intertrade to avail of
letters of credit to finance importations, which had all been paid in full, and therefore
the agreement was thereby terminated. Again, the agreement shows up the fallacy of
this argument. The document is boldly denominated "CONTINUING SURETYSHIP,"
and paragraph VI thereof stipulates it to be a continuing one, "to remain in force until
written notice shall have been received by the Bank that it has been revoked by the
surety . . . " In other words, the option to cancel, in writing, was given to the sureties;
the evidence does not show any written notice of such cancellation. . . .
And, the argument that the agreement was executed as security for letters of credit that
had already been paid is in itself confirmation that the suretyship was meant to benefit
Intertrade. The trust receipts . . . and the bills of exchange . . . are all in the name of
Intertrade.
The suretyship is both retrospective and prospective in its operation. Its wording
covers all obligations of Intertrade existing as of its date as well as those that may exist
thereafter. Hence, its coverage extends to the promissory note as well.4
Understandably, petitioner lost no time in bringing this case before us via a petition for
review on certiorari on the following grounds:
THE RESPONDENT COURT ERRED IN REVERSING AND [SETTING] ASIDE
THE FINDING OF THE TRIAL COURT THAT THE LOAN OF P500,000.00
PROCURED 21 MARCH 1978 BY RESPONDENTS VITALIADO ARRIETA AND
LILIA PEREZ IS NOT A CORPORATE LIABILITY OF RESPONDENT
INTERTRADE AND THAT PETITIONER IS NOT LIABLE THEREON UNDER
THE "CONTINUING SURETYSHIP AGREEMENT" DATED 4 MARCH 1977.
THE CONCLUSION OF THE RESPONDENT COURT THAT THE LOAN OF
P500,000.00 PROCURED 21 MARCH 1978 BY RESPONDENT VITALIADO
ARRIETA AND LILIA PEREZ IS A CORPORATE LIABILITY OF RESPONDENT
INTERTRADE AND CONSEQUENTLY RENDERING PETITIONER LIABLE IN
HIS PERSONAL CAPACITY AS A SURETY UNDER THE "CONTINUING
SURETYSHIP" OF 4 MARCH 1977, IS GROSSLY ERRONEOUS AND PREMISED
ON A MISAPPREHENSION OF FACTS.
THE CONCLUSIONS AND CONSTRUCTION REACHED BY RESPONDENT
COURT FROM THE FACTS AND EVIDENCE OF RECORD, ARE INCORRECT
RESULTING IN AN ERRONEOUS DECISION GRAVELY PREJUDICIAL TO
THE SUBSTANTIAL RIGHTS OF PETITIONER.5
The petition has merit,.
The principal reason for respondent appellate court's reversal of the trial court's
absolution of petitioner is its finding that the loan made by private respondent Arrieta
and Lilia Perez were admitted by Intertrade to be its own obligation.
After a careful scrutiny of the records, however, we find and we so rule that there is
neither factual nor legal basis for such a finding by respondent Appellate Court.
First, the general rule that "the allegations, statements, or admissions contained in a
pleading are conclusive as against the pleader" 6 is not an absolute and inflexible
rule7 and is subject to exceptions. Rule 129, Section 4, of the Rules of Evidence,
provides:
Sec. 4. Judicial admissions. — An admission, verbal or written, made by a party in the
course of the proceedings in the same case, does not require proof. The admission may
be contradicted only by showing that it was made through palpable mistake or that no
such admission was made. (Emphasis supplied).
In other words, an admission in a pleading on which a party goes to trial may be
contradicted by showing that it was made by improvidence or mistake or that no such
admission was made, i.e., "not in the sense in which the admission was made to appear
or the admission was taken out of context."8
In the case at bench, we find that the respondent Court of Appeals committed an error
in appreciating the "Answer" filed by the lawyer of Intertrade as an admission of
corporate liability for the subject loan. A careful study of the responsive pleading filed
by Atty. Francisco Pangilinan, counsel for Intertrade, would reveal that there was
neither express nor implied admission of corporate liability warranting the application
of the general rule. Thus, the alleged judicial admission may be contradicted and
controverted because it was taken out of context and no admission was made at all.
119
In any event, assuming arguendo that the responsive pleading did contain the aforesaid
admission of corporate liability, the same may not still be given effect at all. As
correctly found by the trial court, the alleged admission made in the answer by the
counsel for Intertrade was "without any enabling act or attendant ratification of
corporate act,"9 as would authorize or even ratify such admission. In the absence of
such ratification or authority, such admission does not bind the corporation.
Second, the respondent appellate court likewise adjudged Intertrade liable because of
the two letters emanating from the office of Mr. Arrieta which the respondent court
considered "as indicating the corporate liability of the corporation." 10 These
documents and admissions cannot have the effect of a ratification of an unauthorized
act. As we elucidated in the case of Vicente v. Geraldez, 11 "ratification can never be
made on the part of the corporation by the same persons who wrongfully assume the
power to make the contract, but the ratification must be by the officer as governing
body having authority to make such contract." In other words, the unauthorized act of
respondent Arrieta can only be ratified by the action of the Board of Directors and/or
petitioner Aguenza jointly with private respondent Arrieta.
We must emphasize that Intertrade has a distinct personality separate from its
members. The corporation transacts its business only through its officers or agents.
Whatever authority these officers or agents may have is derived from the Board of
Directors or other governing body unless conferred by the charter of the corporation.
An officer's power as an agent of the corporation must be sought from the statute,
charter, the by-laws, as in a delegation of authority to such officer, or the acts of the
Board of Directors formally expressed or implied from a habit or custom of doing
business. 12
Thirdly, we note that the only document to evidence the subject transaction was the
promissory note dated March 21, 1978 signed by private respondents Arrieta and Lilia
Perez. There is no indication in said document as to what capacity the two signatories
had in affixing their signatures thereon.
It is noted that the subject transaction is a loan contract for P500,000.00 under terms
and conditions which are stringent, if not onerous. The power to borrow money is one
of those cases where even a special power of attorney is required. 13 In the instant case,
them is invariably a need of an enabling act of the corporation to be approved by its
Board of Directors. As round by the trial court, the records of this case is bereft of any
evidence that Intertrade through its Board of Directors, conferred upon Arrieta and
Lilia Perez the authority to contract a loan with Metrobank and execute the promissory
note as a security therefor. Neither a board resolution nor a stockholder's resolution
was presented by Metrobank to show that Arrieta and Lilia Perez were empowered by
Intertrade to execute the promissory note. 14
The respondents may argue that the actuation of Arrieta and Liliah Perez was in
accordance with the ordinary course of business usages and practices of Intertrade.
However, this contention is devoid of merit because the prevailing practice in
Intertrade was to explicitly authorize an officer to contract loans in behalf of the
corporation. This is evidenced by the fact that previous to the controversy, the
Intertrade Board of Directors, through a board resolution, jointly empowered and
authorized petitioner and respondent Arrieta to negotiate, apply for, and open credit
lines with Metrobank's. 15 The participation of these two was mandated to be joint and
not separate and individual.
In the case at bench, only respondent Arrieta, together with a bookkeeper of the
corporation, signed the promissory notes, without the participation and approval of
petitioner Aguenza. Moreover, the enabling corporate act on this particular transaction
has not been obtained. Neither has it been shown that any provision of the charter or
any other act of the Board of Directors exists to confer power on the Executive Vice
President acting alone and without the concurrence of its President, to execute the
disputed document. 16
Thus, proceeding from the premise that the subject loan was not the responsibility of
Intertrade, it follows that the undertaking of Arrieta and the bookkeeper was not an
undertaking covered by the Continuing Suretyship Agreement. The rule is that a
contract of surety is never presumed; it must be express and cannot extend to more
than what is stipulated, 17 It is strictly construed against the creditor, every doubt being
resolved against enlarging the liability of the surety.
The present obligation incurred in subject contract of loan, as secured by the Arrieta
and Perez promissory note, is not the obligation of the corporation and petitioner
Aguenza, but the individual and personal obligation of private respondents Arrieta and
Lilia Perez.
WHEREFORE, the petition is GRANTED, and the questioned decision of the Court of
Appeals 18 dated February 11, 1986 is REVERSED and SET ASIDE. The judgment of
the trial court dated February 29, 1984 is hereby REINSTATED.
No Costs.
SO ORDERED.
120

G.R. No. 87434. August 5, 1992
PHILIPPINE AMERICAN GENERAL INSURANCE CO., INC. and TAGUM
PLASTICS, INC., petitioners, vs. SWEET LINES, INC., DAVAO VETERANS
ARRASTRE AND PORT SERVICES, INC. and HON. COURT OF APPEALS,
respondents.
Remedial Law; Civil Procedure; Actionable documents; Bills of lading can be
categorized as actionable documents which under the Rules must be properly pleaded
either as causes of action or defenses, and the genuineness and due execution of which
are deemed admitted unless specifically denied under oath by the adverse party.—As
petitioners are suing upon SLI’s contractual obligation under the contract of carriage as
contained in the bills of lading, such bills of lading can be categorized as actionable
documents which under the Rules must be properly pleaded either as causes of action
or defenses, and the genuineness and due execution of which are deemed admitted
unless specifically denied under oath by the adverse party. The rules on actionable
documents cover and apply to both a cause of action or defense based on said
documents.
Same; Same; Same; Judicial admissions; Judicial admissions, verbal or written, made
by the parties in the pleadings or in the course of the trial or other proceedings in the
same case are conclusive, no evidence being required to prove the same, and cannot be
contradicted unless shown to have been made through palpable mistake or that no such
admission was made.—Petitioners’ failure to specifically deny the existence, much less
the genuineness and due execution, of the instruments in question amounts to an
admission. Judicial admissions, verbal or written, made by the parties in the pleadings
or in the course of the trial or other proceedings in the same case are conclusive, no
evidence being required to prove the same, and cannot be contradicted unless shown to
have been made through palpable mistake or that no such admission was made.
Moreover, when the due execution and genuineness of an instrument are deemed
admitted because of the adverse party’s failure to make a specific verified denial
thereof, the instrument need not be presented formally in evidence for it may be
considered an admitted fact.
Same; Same; Same; Negative Pregnant; Negative pregnant is a denial pregnant with
the admission of the substantial facts in the pleading responded to which are not
squarely denied.—Even granting that petitioners’ averment in their reply amounts to a
denial, it has the procedural earmarks of what in the law on pleadings is called a
negative pregnant, that is, a denial pregnant with the admission of the substantial facts
in the pleading responded to which are not squarely denied. It is in effect an admission
of the averment it is directed to. Thus, while petitioners objected to the validity of such
agreement for being contrary to public policy, the existence of the bills of lading and
said stipulations were nevertheless impliedly admitted by them.
Same; Same; Same; Formal offer of evidence; The non-inclusion of the controverted
bills of lading in the formal offer of evidence cannot be considered a fatal procedural
lapse as would bar respondent carrier from raising the defense of prescription.—We
find merit in respondent court’s comments that petitioners failed to touch on the matter
of the non-presentation of the bills of lading in their brief and earlier on in the appellate
proceedings in this case, hence it is too late in the day to now allow the litigation to be
overturned on that score, for to do so would mean an over-indulgence in technicalities.
Hence, for the reasons already advanced, the non-inclusion of the controverted bills of
lading in the formal offer of evidence cannot, under the facts of this particular case, be
considered a fatal procedural lapse as would bar respondent carrier from raising the
defense of prescription. Petitioners’ feigned ignorance of the provisions of the bills of
lading, particularly on the time limitations for filing a claim and for commencing a suit
in court, as their excuse for non-compliance therewith does not deserve serious
attention.
Same; Same; Right of action; The right of action does not arise until the performance
of all conditions precedent to the action and may be taken away by the running of the
statute of limitations, through estoppel, or by other circumstances which do not affect
the cause of action.—It bears restating that a right of action is the right to pre-sently
enforce a cause of action, while a cause of action, while a cause of action consists of
the operative facts which give rise to such right of action. The right of action does not
arise until the performance of all conditions precedent to the action and may be taken
away by the running of the statute of limitations, through estoppel, or by other
circumstances which do not affect the cause of action. Performance or fulfillment of all
conditions precedent upon which a right of action depends must be sufficiently alleged,
considering that the burden of proof to show that a party has a right of action is upon
the person initiating the suit.
Maritime Commerce; Contract of Shipment; Notice of loss or injury to the goods;
Notice of loss or injury protects the carrier by affording it an opportunity to make an
investigation of a claim while the matter is fresh and easily investigated so as to
safeguard itself from false and fraudulent claim.—More particularly, where the
contract of shipment contains a reasonable requirement of giving notice of loss of or
injury to the goods, the giving of such notice is a condition precedent to the action for
loss or injury or the right to enforce the carrier’s liability. Such requirement is not an
empty formalism. The fundamental reason or purpose of such a stipulation is not to
relieve the carrier from just liability, but reasonably to inform it that the shipment has
been damaged and that it is charged with liability therefor, and to give it an opportunity
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to examine the nature and extent of the injury. This protects the carrier by affording it
an opportunity to make an investigation of a claim while the matter is fresh and easily
investigated so as to safeguard itself from false and fraudulent claims.
Same; Same; Same; Remedial Law; Civil Procedure; Action; Prescription; The
findings of respondent court as supported by petitioner’s formal offer of evidence in
the court below show that the claim was filed with Sweet Lines Incorporated only on
April 28, 1978, way beyond the period provided in the bills of lading and violative of
the contractual provision, the inevitable loss of which is the loss of petitioner’s remedy
or right to sue.—The shipment in question was discharged into the custody of the
consignee on May 15, 1977, and it was from this date that petitioners’ cause of action
accrued, with thirty (30) days therefrom within which to file a claim with the carrier
for any loss or damage which may have been suffered by the cargo and thereby perfect
their right of action. The findings of respondent court as supported by petitioners’
formal offer of evidence in the court below show that the claim was filed with SLI only
on April 28, 1978, way beyond the period provided in the bills of lading and violative
of the contractual provision, the inevitable consequence of which is the loss of
petitioners’ remedy or right to sue. Even the filing of the complaint on May 12, 1978 is
of no remedial or practical consequence, since the time limits for the filing thereof
whether viewed as a condition precedent or as a prescriptive period, would in this case
be productive of the same result, that is, that petitioners had no right of action to begin
with or, at any rate, their claim was time-barred.
Same; Same; Notice of claim under Art. 366 of the Code of Commerce; Non-
compliance with the requirement of filing a notice of claim under Art. 366 of the Code
of Commerce does not affect the consignee’s right of action against the carrier.—As
explained above, the shortened period for filing suit is not unreasonable and has in fact
been generally recognized to be a valid business practice in the shipping industry.
Petitioners’ advertence to the Court’s holding in the Southern Lines case, supra, is
futile as what was involved was a claim for refund of excess payment. We ruled
therein that non-compliance with the requirement of filing a notice of claim under
Article 366 of the Code of Commerce does not affect the consignee’s right of action
against the carrier because said requirement applies only to cases for recovery of
damages on account of loss of or damage to cargo, not to an action for refund of
overpayment, and on the further consideration that neither the Code of Commerce nor
the bills of lading therein provided any time limitation for suing for refund of money
paid in excess, except only that it be filed within a reasonable time.
Same; Remedial Law; Venue of action; Contract of adhesion; Contracts of adhesion
wherein one party imposes a ready-made form of contract on the other are contracts
not entirely prohibited.—The ruling in Sweet Lines categorizing the stipulated
limitation on venue of action provided in the subject bill of lading as a contract of
adhesion and, under the circumstances therein, void for being contrary to public policy
is evidently likewise unavailing in view of the discrete environmental facts involved
and the fact that the restriction therein was unreasonable. In any case, Ong Yiu vs.
Court of Appeals, et al., instructs us that “contracts of adhesion wherein one party
imposes a ready-made form of contract on the other x x x are contracts not entirely
prohibited. The one who adheres to the contract is in reality free to reject it entirely; if
he adheres he gives his consent.” In the present case, not even an allegation of
ignorance of a party excuses non-compliance with the contractual stipulations since the
responsibility for ensuring full comprehension of the provisions of a contract of
carriage devolves not on the carrier but on the owner, shipper, or consignee as the case
may be. Philippine American General Insurance Co., Inc. vs. Sweet Lines, Inc., 212
SCRA 194, G.R. No. 87434 August 5, 1992
A maritime suit 1 was commenced on May 12, 1978 by herein Petitioner Philippine
American General Insurance Co., Inc. (Philamgen) and Tagum Plastics, Inc. (TPI)
against private respondents Sweet Lines, Inc. (SLI) and Davao Veterans Arrastre and
Port Services, Inc. (DVAPSI), along with S.C.I. Line (The Shipping Corporation of
India Limited) and F.E. Zuellig, Inc., as co-defendants in the court a quo, seeking
recovery of the cost of lost or damaged shipment plus exemplary damages, attorney's
fees and costs allegedly due to defendants' negligence, with the following factual
backdrop yielded by the findings of the court below and adopted by respondent court:
It would appear that in or about March 1977, the vessel SS "VISHVA YASH"
belonging to or operated by the foreign common carrier, took on board at Baton
Rouge, LA, two (2) consignments of cargoes for shipment to Manila and later for
transhipment to Davao City, consisting of 600 bags Low Density Polyethylene 631 and
another 6,400 bags Low Density Polyethylene 647, both consigned to the order of Far
East Bank and Trust Company of Manila, with arrival notice to Tagum Plastics, Inc.,
Madaum, Tagum, Davao City. Said cargoes were covered, respectively, by Bills of
Lading Nos. 6 and 7 issued by the foreign common carrier (Exhs. E and F). The
necessary packing or Weight List (Exhs. A and B), as well as the Commercial Invoices
(Exhs. C and D) accompanied the shipment. The cargoes were likewise insured by the
Tagum Plastics Inc. with plaintiff Philippine American General Insurance Co., Inc.,
(Exh. G).
In the course of time, the said vessel arrived at Manila and discharged its cargoes in the
Port of Manila for transhipment to Davao City. For this purpose, the foreign carrier
awaited and made use of the services of the vessel called M/V "Sweet Love" owned
and operated by defendant interisland carrier.
Subject cargoes were loaded in Holds Nos. 2 and 3 of the interisland carrier. These
were commingled with similar cargoes belonging to Evergreen Plantation and also
Standfilco.
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On May 15, 1977, the shipment(s) were discharged from the interisland carrier into the
custody of the consignee. A later survey conducted on July 8, 1977, upon the instance
of the plaintiff, shows the following:
Of the cargo covered by Bill of Lading No. 25 or (2)6, supposed to contain 6,400 bags
of Low Density Polyethylene 647 originally inside 160 pallets, there were delivered to
the consignee 5,413 bags in good order condition. The survey shows shortages,
damages and losses to be as follows:
Undelivered/Damaged bags as tallied during discharge from vessel-173 bags;
undelivered and damaged as noted and observed whilst stored at the pier-699 bags; and
shortlanded-110 bags (Exhs. P and P-1).
Of the 600 bags of Low Density Polyethylene 631, the survey conducted on the same
day shows an actual delivery to the consignee of only 507 bags in good order
condition. Likewise noted were the following losses, damages and shortages, to wit:
Undelivered/damaged bags and tally sheets during discharge from vessel-17 bags.
Undelivered and damaged as noted and observed whilst stored at the pier-66 bags;
Shortlanded-10 bags.
Therefore, of said shipment totalling 7,000 bags, originally contained in 175 pallets,
only a total of 5,820 bags were delivered to the consignee in good order condition,
leaving a balance of 1,080 bags. Such loss from this particular shipment is what any or
all defendants may be answerable to (sic).
As already stated, some bags were either shortlanded or were missing, and some of the
1,080 bags were torn, the contents thereof partly spilled or were fully/partially
emptied, but, worse, the contents thereof contaminated with foreign matters and
therefore could no longer serve their intended purpose. The position taken by the
consignee was that even those bags which still had some contents were considered as
total losses as the remaining contents were contaminated with foreign matters and
therefore did not (sic) longer serve the intended purpose of the material. Each bag was
valued, taking into account the customs duties and other taxes paid as well as charges
and the conversion value then of a dollar to the peso, at P110.28 per bag (see Exhs. L
and L-1 M and O). 2
Before trial, a compromise agreement was entered into between petitioners, as
plaintiffs, and defendants S.C.I. Line and F.E. Zuellig, upon the latter's payment of
P532.65 in settlement of the claim against them. Whereupon, the trial court in its order
of August 12, 1981 3 granted plaintiffs' motion to dismiss grounded on said amicable
settlement and the case as to S.C.I. Line and F.E. Zuellig was consequently "dismissed
with prejudice and without pronouncement as to costs."
The trial court thereafter rendered judgment in favor of herein petitioners on this
dispositive portion:
WHEREFORE, judgment is hereby rendered in favor of the plaintiff Philippine
General American Insurance Company Inc. and against the remaining defendants,
Sweet Lines Inc. and Davao Veterans Arrastre Inc. as follows:
Defendant Sweet Lines, Inc. is ordered to pay said plaintiff the sum of P34,902.00,
with legal interest thereon from date of extrajudicial demand on April 28, 1978 (Exh.
M) until fully paid;
Defendant Sweet Lines Inc. and Davao Veterans Arrastre and (Port) Services Inc. are
directed to pay jointly and severally, the plaintiff the sum of P49,747.55, with legal
interest thereon from April 28, 1978 until fully paid;
Each of said defendants are ordered to pay the plaintiffs the additional sum of P5,000
is reimbursable attorney's fees and other litigation expenses;
Each of said defendants shall pay one-fourth (1/4) costs. 4
Due to the reversal on appeal by respondent court of the trial court's decision on the
ground of prescription, 5 in effect dismissing the complaint of herein petitioners, and
the denial of their motion for reconsideration, 6 petitioners filed the instant petition for
review on certiorari, faulting respondent appellate court with the following errors: (1)
in upholding, without proof, the existence of the so-called prescriptive period; (2)
granting arguendo that the said prescriptive period does exist, in not finding the same
to be null and void; and (3) assuming arguendo that the said prescriptive period is
valid and legal, in failing to conclude that petitioners substantially complied
therewith. 7
Parenthetically, we observe that herein petitioners are jointly pursuing this case,
considering their common interest in the shipment subject of the present controversy,
to obviate any question as to who the real party in interest is and to protect their
respective rights as insurer and insured. In any case, there is no impediment to the legal
standing of Petitioner Philamgen, even if it alone were to sue herein private
respondents in its own capacity as insurer, it having been subrogated to all rights of
recovery for loss of or damage to the shipment insured under its Marine Risk Note No.
438734 dated March 31, 1977 8 in view of the full settlement of the claim thereunder
as evidenced by the subrogation receipt 9 issued in its favor by Far East Bank and Trust
Co., Davao Branch, for the account of petitioner TPI.
Upon payment of the loss covered by the policy, the insurer's entitlement to
subrogation pro tanto, being of the highest equity, equips it with a cause of action
against a third party in case of contractual breach. 10 Further, the insurer's subrogatory
right to sue for recovery under the bill of lading in case of loss of or damage to the
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cargo is jurisprudentially upheld. 11 However, if an insurer, in the exercise of its
subrogatory right, may proceed against the erring carrier and for all intents and
purposes stands in the place and in substitution of the consignee, a fortiori such insurer
is presumed to know and is just as bound by the contractual terms under the bill of
lading as the insured.
On the first issue, petitioners contend that it was error for the Court of Appeals to
reverse the appealed decision on the supposed ground of prescription when SLI failed
to adduce any evidence in support thereof and that the bills of lading said to contain the
shortened periods for filing a claim and for instituting a court action against the carrier
were never offered in evidence. Considering that the existence and tenor of this
stipulation on the aforesaid periods have allegedly not been established, petitioners
maintain that it is inconceivable how they can possibly comply therewith. 12 In
refutation, SLI avers that it is standard practice in its operations to issue bills of lading
for shipments entrusted to it for carriage and that it in fact issued bills of lading
numbered MD-25 and MD-26 therefor with proof of their existence manifest in the
records of the case. 13 For its part, DVAPSI insists on the propriety of the dismissal of
the complaint as to it due to petitioners' failure to prove its direct responsibility for the
loss of and/or damage to the cargo. 14
On this point, in denying petitioner's motion for reconsideration, the Court of Appeals
resolved that although the bills of lading were not offered in evidence, the litigation
obviously revolves on such bills of lading which are practically the documents or
contracts sued upon, hence, they are inevitably involved and their provisions cannot be
disregarded in the determination of the relative rights of the parties thereto. 15
Respondent court correctly passed upon the matter of prescription, since that defense
was so considered and controverted by the parties. This issue may accordingly be taken
cognizance of by the court even if not inceptively raised as a defense so long as its
existence is plainly apparent on the face of relevant pleadings. 16 In the case at bar,
prescription as an affirmative defense was seasonably raised by SLI in its
answer, 17 except that the bills of lading embodying the same were not formally offered
in evidence, thus reducing the bone of contention to whether or not prescription can be
maintained as such defense and, as in this case, consequently upheld on the strength of
mere references thereto.
As petitioners are suing upon SLI's contractual obligation under the contract of
carriage as contained in the bills of lading, such bills of lading can be categorized as
actionable documents which under the Rules must be properly pleaded either as causes
of action or defenses, 18 and the genuineness and due execution of which are deemed
admitted unless specifically denied under oath by the adverse party. 19 The rules on
actionable documents cover and apply to both a cause of action or defense based on
said documents. 20
In the present case and under the aforestated assumption that the time limit involved is
a prescriptive period, respondent carrier duly raised prescription as an affirmative
defense in its answer setting forth paragraph 5 of the pertinent bills of lading which
comprised the stipulation thereon by parties, to wit:
5. Claims for shortage, damage, must be made at the time of delivery to consignee or
agent, if container shows exterior signs of damage or shortage. Claims for non-
delivery, misdelivery, loss or damage must be filed within 30 days from accrual. Suits
arising from shortage, damage or loss, non-delivery or misdelivery shall be instituted
within 60 days from date of accrual of right of action. Failure to file claims or institute
judicial proceedings as herein provided constitutes waiver of claim or right of action.
In no case shall carrier be liable for any delay, non-delivery, misdelivery, loss of
damage to cargo while cargo is not in actual custody of carrier. 21
In their reply thereto, herein petitioners, by their own assertions that —
2. In connection with Pars. 14 and 15 of defendant Sweet Lines, Inc.'s Answer,
plaintiffs state that such agreements are what the Supreme Court considers as contracts
of adhesion (see Sweet Lines, Inc. vs. Hon. Bernardo Teves, et al., G.R. No. L-37750,
May 19, 1978) and, consequently, the provisions therein which are contrary to law and
public policy cannot be availed of by answering defendant as valid defenses. 22
thereby failed to controvert the existence of the bills of lading and the aforequoted
provisions therein, hence they impliedly admitted the same when they merely assailed
the validity of subject stipulations.
Petitioners' failure to specifically deny the existence, much less the genuineness and
due execution, of the instruments in question amounts to an admission. Judicial
admissions, verbal or written, made by the parties in the pleadings or in the course of
the trial or other proceedings in the same case are conclusive, no evidence being
required to prove the same, and cannot be contradicted unless shown to have been
made through palpable mistake or that no such admission was made. 23 Moreover,
when the due execution and genuineness of an instrument are deemed admitted
because of the adverse party's failure to make a specific verified denial thereof, the
instrument need not be presented formally in evidence for it may be considered an
admitted fact. 24
Even granting that petitioners' averment in their reply amounts to a denial, it has the
procedural earmarks of what in the law on pleadings is called a negative pregnant, that
is, a denial pregnant with the admission of the substantial facts in the pleading
responded to which are not squarely denied. It is in effect an admission of the averment
it is directed to. 25 Thus, while petitioners objected to the validity of such agreement for
being contrary to public policy, the existence of the bills of lading and said stipulations
were nevertheless impliedly admitted by them.
124
We find merit in respondent court's comments that petitioners failed to touch on the
matter of the non-presentation of the bills of lading in their brief and earlier on in the
appellate proceedings in this case, hence it is too late in the day to now allow the
litigation to be overturned on that score, for to do so would mean an over-indulgence in
technicalities. Hence, for the reasons already advanced, the non-inclusion of the
controverted bills of lading in the formal offer of evidence cannot, under the facts of
this particular case, be considered a fatal procedural lapse as would bar respondent
carrier from raising the defense of prescription. Petitioners' feigned ignorance of the
provisions of the bills of lading, particularly on the time limitations for filing a claim
and for commencing a suit in court, as their excuse for non-compliance therewith does
not deserve serious attention.
It is to be noted that the carriage of the cargo involved was effected pursuant to an
"Application for Delivery of Cargoes without Original Bill of Lading" issued on May
20, 1977 in Davao City 26 with the notation therein that said application corresponds to
and is subject to the terms of bills of lading MD-25 and MD-26. It would be a safe
assessment to interpret this to mean that, sight unseen, petitioners acknowledged the
existence of said bills of lading. By having the cargo shipped on respondent carrier's
vessel and later making a claim for loss on the basis of the bills of lading, petitioners
for all intents and purposes accepted said bills. Having done so they are bound by all
stipulations contained therein. 27 Verily, as petitioners are suing for recovery on the
contract, and in fact even went as far as assailing its validity by categorizing it as a
contract of adhesion, then they necessarily admit that there is such a contract, their
knowledge of the existence of which with its attendant stipulations they cannot now be
allowed to deny.
On the issue of the validity of the controverted paragraph 5 of the bills of lading above
quoted which unequivocally prescribes a time frame of thirty (30) days for filing a
claim with the carrier in case of loss of or damage to the cargo and sixty (60) days
from accrual of the right of action for instituting an action in court, which periods must
concur, petitioners posit that the alleged shorter prescriptive period which is in the
nature of a limitation on petitioners' right of recovery is unreasonable and that SLI has
the burden of proving otherwise, citing the earlier case of Southern Lines, Inc. vs.
Court of Appeals, et al. 28 They postulate this on the theory that the bills of lading
containing the same constitute contracts of adhesion and are, therefore, void for being
contrary to public policy, supposedly pursuant to the dictum in Sweet Lines, Inc. vs.
Teves, et al. 29
Furthermore, they contend, since the liability of private respondents has been clearly
established, to bar petitioners' right of recovery on a mere technicality will pave the
way for unjust enrichment. 30 Contrarily, SLI asserts and defends the reasonableness of
the time limitation within which claims should be filed with the carrier; the necessity
for the same, as this condition for the carrier's liability is uniformly adopted by nearly
all shipping companies if they are to survive the concomitant rigors and risks of the
shipping industry; and the countervailing balance afforded by such stipulation to the
legal presumption of negligence under which the carrier labors in the event of loss of
or damage to the cargo. 31
It has long been held that Article 366 of the Code of Commerce applies not only to
overland and river transportation but also to maritime
transportation. 32 Moreover, we agree that in this jurisdiction, as viewed from another
angle, it is more accurate to state that the filing of a claim with the carrier within the
time limitation therefor under Article 366 actually constitutes a condition precedent to
the accrual of a right of action against a carrier for damages caused to the merchandise.
The shipper or the consignee must allege and prove the fulfillment of the condition and
if he omits such allegations and proof, no right of action against the carrier can accrue
in his favor. As the requirements in Article 366, restated with a slight modification in
the assailed paragraph 5 of the bills of lading, are reasonable conditions precedent,
they are not limitations of action. 33 Being conditions precedent, their performance
must precede a suit for enforcement 34 and the vesting of the right to file spit does not
take place until the happening of these conditions. 35
Now, before an action can properly be commenced all the essential elements of the
cause of action must be in existence, that is, the cause of action must be complete. All
valid conditions precedent to the institution of the particular action, whether prescribed
by statute, fixed by agreement of the parties or implied by law must be performed or
complied with before commencing the action, unless the conduct of the adverse party
has been such as to prevent or waive performance or excuse non-performance of the
condition. 36
It bears restating that a right of action is the right to presently enforce a cause of action,
while a cause of action consists of the operative facts which give rise to such right of
action. The right of action does not arise until the performance of all conditions
precedent to the action and may be taken away by the running of the statute of
limitations, through estoppel, or by other circumstances which do not affect the cause
of action. 37 Performance or fulfillment of all conditions precedent upon which a right
of action depends must be sufficiently alleged, 38 considering that the burden of proof
to show that a party has a right of action is upon the person initiating the suit. 39
More particularly, where the contract of shipment contains a reasonable requirement of
giving notice of loss of or injury to the goods, the giving of such notice is a condition
precedent to the action for loss or injury or the right to enforce the carrier's liability.
Such requirement is not an empty formalism. The fundamental reason or purpose of
such a stipulation is not to relieve the carrier from just liability, but reasonably to
inform it that the shipment has been damaged and that it is charged with liability
therefor, and to give it an opportunity to examine the nature and extent of the injury.
This protects the carrier by affording it an opportunity to make an investigation of a
125
claim while the matter is fresh and easily investigated so as to safeguard itself from
false and fraudulent claims. 40
Stipulations in bills of lading or other contracts of shipment which require notice of
claim for loss of or damage to goods shipped in order to impose liability on the carrier
operate to prevent the enforcement of the contract when not complied with, that is,
notice is a condition precedent and the carrier is not liable if notice is not given in
accordance with the stipulation, 41 as the failure to comply with such a stipulation in a
contract of carriage with respect to notice of loss or claim for damage bars recovery for
the loss or damage suffered. 42
On the other hand, the validity of a contractual limitation of time for filing the suit
itself against a carrier shorter than the statutory period therefor has generally been
upheld as such stipulation merely affects the shipper's remedy and does not affect the
liability of the carrier. In the absence of any statutory limitation and subject only to the
requirement on the reasonableness of the stipulated limitation period, the parties to a
contract of carriage may fix by agreement a shorter time for the bringing of suit on a
claim for the loss of or damage to the shipment than that provided by the statute of
limitations. Such limitation is not contrary to public policy for it does not in any way
defeat the complete vestiture of the right to recover, but merely requires the assertion
of that right by action at an earlier period than would be necessary to defeat it through
the operation of the ordinary statute of limitations. 43
In the case at bar, there is neither any showing of compliance by petitioners with the
requirement for the filing of a notice of claim within the prescribed period nor any
allegation to that effect. It may then be said that while petitioners may possibly have a
cause of action, for failure to comply with the above condition precedent they lost
whatever right of action they may have in their favor or, token in another sense, that
remedial right or right to relief had prescribed.44
The shipment in question was discharged into the custody of the consignee on May 15,
1977, and it was from this date that petitioners' cause of action accrued, with thirty (30)
days therefrom within which to file a claim with the carrier for any loss or damage
which may have been suffered by the cargo and thereby perfect their right of action.
The findings of respondent court as supported by petitioners' formal offer of evidence
in the court below show that the claim was filed with SLI only on April 28, 1978, way
beyond the period provided in the bills of lading 45 and violative of the contractual
provision, the inevitable consequence of which is the loss of petitioners' remedy or
right to sue. Even the filing of the complaint on May 12, 1978 is of no remedial or
practical consequence, since the time limits for the filing thereof, whether viewed as a
condition precedent or as a prescriptive period, would in this case be productive of the
same result, that is, that petitioners had no right of action to begin with or, at any rate,
their claim was time-barred.
What the court finds rather odd is the fact that petitioner TPI filed a provisional claim
with DVAPSI as early as June 14, 1977 46 and, as found by the trial court, a survey
fixing the extent of loss of and/or damage to the cargo was conducted on July 8, 1977
at the instance of petitioners. 47 If petitioners had the opportunity and awareness to file
such provisional claim and to cause a survey to be conducted soon after the discharge
of the cargo, then they could very easily have filed the necessary formal, or even a
provisional, claim with SLI itself 48 within the stipulated period therefor, instead of
doing so only on April 28, 1978 despite the vessel's arrival at the port of destination on
May 15, 1977. Their failure to timely act brings us to no inference other than the fact
that petitioners slept on their rights and they must now face the consequences of such
inaction.
The ratiocination of the Court of Appeals on this aspect is worth reproducing:
xxx xxx xxx
It must be noted, at this juncture, that the aforestated time limitation in the presentation
of claim for loss or damage, is but a restatement of the rule prescribed under Art. 366
of the Code of Commerce which reads as follows:
Art. 366. Within the twenty-four hours following the receipt of the merchandise, the
claim against the carrier for damage or average which may be found therein upon
opening the packages, may be made, provided that the indications of the damage or
average which gives rise to the claim cannot be ascertained from the outside part of the
packages, in which case the claims shall be admitted only at the time of the receipt.
After the periods mentioned have elapsed, or the transportation charges have been
paid, no claim shall be admitted against the carrier with regard to the condition in
which the goods transported were delivered.
Gleanable therefrom is the fact that subject stipulation even lengthened the period for
presentation of claims thereunder. Such modification has been sanctioned by the
Supreme Court. In the case of Ong Yet (M)ua Hardware Co., Inc. vs. Mitsui Steamship
Co., Ltd., et al., 59 O.G. No. 17, p. 2764, it ruled that Art. 366 of the Code of
Commerce can be modified by a bill of lading prescribing the period of 90 days after
arrival of the ship, for filing of written claim with the carrier or agent, instead of the
24-hour time limit after delivery provided in the aforecited legal provision.
Tested, too, under paragraph 5 of said Bill of Lading, it is crystal clear that the
commencement of the instant suit on May 12, 1978 was indeed fatally late. In view of
the express provision that "suits arising from
. . . damage or loss shall be instituted within 60 days from date of accrual of right of
action," the present action necessarily fails on ground of prescription.
126
In the absence of constitutional or statutory prohibition, it is usually held or recognized
that it is competent for the parties to a contract of shipment to agree on a limitation of
time shorter than the statutory period, within which action for breach of the contract
shall be brought, and such limitation will be enforced if reasonable . . . (13 C.J.S. 496-
497)
A perusal of the pertinent provisions of law on the matter would disclose that there is
no constitutional or statutory prohibition infirming paragraph 5 of subject Bill of
Lading. The stipulated period of 60 days is reasonable enough for appellees to
ascertain the facts and thereafter to sue, if need be, and the 60-day period agreed upon
by the parties which shortened the statutory period within which to bring action for
breach of contract is valid and binding. . . . (Emphasis in the original text.) 49
As explained above, the shortened period for filing suit is not unreasonable and has in
fact been generally recognized to be a valid business practice in the shipping industry.
Petitioners' advertence to the Court's holding in the Southern Lines case, supra, is
futile as what was involved was a claim for refund of excess payment. We ruled
therein that non-compliance with the requirement of filing a notice of claim under
Article 366 of the Code of Commerce does not affect the consignee's right of action
against the carrier because said requirement applies only to cases for recovery of
damages on account of loss of or damage to cargo, not to an action for refund of
overpayment, and on the further consideration that neither the Code of Commerce nor
the bills of lading therein provided any time limitation for suing for refund of money
paid in excess, except only that it be filed within a reasonable time.
The ruling in Sweet Lines categorizing the stipulated limitation on venue of action
provided in the subject bill of lading as a contract of adhesion and, under the
circumstances therein, void for being contrary to public policy is evidently likewise
unavailing in view of the discrete environmental facts involved and the fact that the
restriction therein was unreasonable. In any case, Ong Yiu vs. Court of Appeals, et
al., 50 instructs us that "contracts of adhesion wherein one party imposes a ready-made
form of contract on the other . . . are contracts not entirely prohibited. The one who
adheres to the contract is in reality free to reject it entirely; if he adheres he gives his
consent." In the present case, not even an allegation of ignorance of a party excuses
non-compliance with the contractual stipulations since the responsibility for ensuring
full comprehension of the provisions of a contract of carriage devolves not on the
carrier but on the owner, shipper, or consignee as the case may be.
While it is true that substantial compliance with provisions on filing of claim for loss
of or damage to cargo may sometimes suffice, the invocation of such an assumption
must be viewed vis-a-vis the object or purpose which such a provision seeks to attain
and that is to afford the carrier a reasonable opportunity to determine the merits and
validity of the claim and to protect itself against unfounded impositions. 51 Petitioners'
would nevertheless adopt an adamant posture hinged on the issuance by SLI of a
"Report on Losses and Damages," dated May 15, 1977, 52 from which petitioners
theorize that this charges private respondents with actual knowledge of the loss and
damage involved in the present case as would obviate the need for or render
superfluous the filing of a claim within the stipulated period.
Withal, it has merely to be pointed out that the aforementioned report bears this
notation at the lower part thereof: "Damaged by Mla. labor upon unloading; B/L noted
at port of origin," as an explanation for the cause of loss of and/or damage to the cargo,
together with an iterative note stating that "(t)his Copy should be submitted together
with your claim invoice or receipt within 30 days from date of issue otherwise your
claim will not be honored."
Moreover, knowledge on the part of the carrier of the loss of or damage to the goods
deducible from the issuance of said report is not equivalent to nor does it approximate
the legal purpose served by the filing of the requisite claim, that is, to promptly apprise
the carrier about a consignee's intention to file a claim and thus cause the prompt
investigation of the veracity and merit thereof for its protection. It would be an unfair
imposition to require the carrier, upon discovery in the process of preparing the report
on losses or damages of any and all such loss or damage, to presume the existence of a
claim against it when at that time the carrier is expectedly concerned merely with
accounting for each and every shipment and assessing its condition. Unless and until a
notice of claim is therewith timely filed, the carrier cannot be expected to presume that
for every loss or damage tallied, a corresponding claim therefor has been filed or is
already in existence as would alert it to the urgency for an immediate investigation of
the soundness of the claim. The report on losses and damages is not the claim referred
to and required by the bills of lading for it does not fix responsibility for the loss or
damage, but merely states the condition of the goods shipped. The claim contemplated
herein, in whatever form, must be something more than a notice that the goods have
been lost or damaged; it must contain a claim for compensation or indicate an intent to
claim. 53
Thus, to put the legal effect of respondent carrier's report on losses or damages, the
preparation of which is standard procedure upon unloading of cargo at the port of
destination, on the same level as that of a notice of claim by imploring substantial
compliance is definitely farfetched. Besides, the cited notation on the carrier's report
itself makes it clear that the filing of a notice of claim in any case is imperative if
carrier is to be held liable at all for the loss of or damage to cargo.
Turning now to respondent DVAPSI and considering that whatever right of action
petitioners may have against respondent carrier was lost due to their failure to
seasonably file the requisite claim, it would be awkward, to say the least, that by some
convenient process of elimination DVAPSI should proverbially be left holding the bag,
and it would be pure speculation to assume that DVAPSI is probably responsible for
the loss of or damage to cargo. Unlike a common carrier, an arrastre operator does not
127
labor under a presumption of negligence in case of loss, destruction or deterioration of are only interested at that point and time in the liability as regards the underwriter in
goods discharged into its custody. In other words, to hold an arrastre operator liable for accordance with the policy that we issued.
loss of and/or damage to goods entrusted to it there must be preponderant evidence that
it did not exercise due diligence in the handling and care of the goods. x x x           x x x          x x x

Petitioners failed to pinpoint liability on any of the original defendants and in this
seemingly wild goose-chase, they cannot quite put their finger down on when, where,
how and under whose responsibility the loss or damage probably occurred, or as stated
in paragraph 8 of their basic complaint filed in the court below, whether "(u)pon
discharge of the cargoes from the original carrying vessel, the SS VISHVA YASH,"
and/or upon discharge of the cargoes from the interisland vessel the MV "SWEET
LOVE," in Davao City and later while in the custody of defendant arrastre operator. 54
The testimony of petitioners' own witness, Roberto Cabato, Jr., Marine and Aviation
Claims Manager of petitioner Philamgen, was definitely inconclusive and the
responsibility for the loss or damage could still not be ascertained therefrom:
Q In other words, Mr. Cabato, you only computed the loss on the basis of the figures
submitted to you and based on the documents like the survey certificate and the
certificate of the arrastre?
A Yes, sir.
Q Therefore, Mr. Cabato, you have no idea how or where these losses were incurred?
A No, sir.
Q Mr. Witness, from the documents, namely, the survey of Manila Adjusters and
Surveyors Company, the survey of Davao Arrastre contractor and the bills of lading
issued by the defendant Sweet Lines, will you be able to tell the respective liabilities of
the bailees and/or carriers concerned?
A No, sir. (Emphasis ours.) 55
Neither did nor could the trial court, much less the Court of Appeals, precisely
establish the stage in the course of the shipment when the goods were lost, destroyed or
damaged. What can only be inferred from the factual findings of the trial court is that
by the time the cargo was discharged to DVAPSI, loss or damage had already occurred
and that the same could not have possibly occurred while the same was in the custody
of DVAPSI, as demonstrated by the observations of the trial court quoted at the start of
this opinion.
ACCORDINGLY, on the foregoing premises, the instant petition is DENIED and the
dismissal of the complaint in the court a quo as decreed by respondent Court of
Appeals in its challenged judgment is hereby AFFIRMED.
SO ORDERED.

x x x           x x x          x x x
Note.—Judicial admissions are conclusive and no evidence is required to prove the
Q Mr. Witness, you said that you processed and investigated the claim involving the same. (Solivio vs. Court of Appeals, 182 Philippine American General Insurance Co.,
shipment in question. Is it not a fact that in your processing and investigation you Inc. vs. Sweet Lines, Inc., 212 SCRA 194, G.R. No. 87434 August 5, 1992
considered how the shipment was transported? Where the losses could have occurred
and what is the extent of the respective responsibilities of the bailees and/or carriers
involved?

x x x           x x x          x x x

A With respect to the shipment being transported, we have of course to get into it in
order to check whether the shipment coming in to this port is in accordance with the
policy condition, like in this particular case, the shipment was transported to Manila
and transhipped through an interisland vessel in accordance with the policy. With
respect to the losses, we have a general view where losses could have occurred. Of
course we will have to consider the different bailees wherein the shipment must have
passed through, like the ocean vessel, the interisland vessel and the arrastre, but
definitely at that point and time we cannot determine the extent of each liability. We

128

G.R. No. 110020. September 25, 1998.
REPUBLIC OF THE PHILIPPINES, petitioner, vs. COURT OF APPEALS,
HON. LUIS BELLO, JR., Presiding Judge of RTC, Branch 16, Laoag City,
HAROLD M. HERNANDO, and SPOUSES ROLANDO V. ABADILLA and
SUSAN SAMONTE, respondents.
Remedial Law; Certiorari; The circumstances clearly demonstrate the trial court’s bias
and arbitrariness that should have warranted the setting aside of the questioned order of
dismissal for grave abuse of discretion under Rule 65 of the Rules of Court.—Our
careful study of the facts inevitably yields to the conclusion that the Regional Trial
Court presided by Hon. Luis B. Bello, Jr. committed grave abuse of discretion not only
in issuing its order dismissing petitioner’s complaint in Civil Case No. 9934 on a
starkly erroneous ground, but also it committed a grossly irresponsible act of allowing
respondent Hernando who was then under suspension from the practice of law, to
represent himself and his co-defendants in the case. Also, as appearing from the
records, after the lapse of the period to file an answer on the part of respondents
Hernando and the Quetulios, the trial court set the case for pre-trial without formally
ruling on petitioner’s motion to declare them in default. Surprisingly, the trial court
thereafter, allowed said defendants to file their answer upon the latter’s verbal motion.
This enabled respondent Hernando to file his pleading “Comment/Answer/Motion to
Dismiss,” with certain annexes which were considered by the trial court as actionable
documents, despite the fact that petitioner was not a party thereto. All these
circumstances clearly demonstrate the trial court’s bias and arbitrariness that should
have warranted the setting aside of the questioned order of dismissal for grave abuse of
discretion under Rule 65 of the Rules of Court. Consequently, petitioner’s original
action for certiorari filed with respondent Court of Appeals on October 8, 1992 to
annul the trial court’s Order dated May 5, 1992 dismissing petitioner’s complaint
should have been given due course.
Same; Compromise; It is well-settled that a judicial compromise has the effect of res
judicata and is immediately executory and not appealable.—The Compromise
Agreement entered into by the petitioner and the Quetulio spouses in the expropriation
case, docketed as Civil Case No. 8396-XV, on January 24, 1985 was approved and
adopted in toto by the Regional Trial Court of Laoag City, Branch XV in its decision
of January 31, 1985. The compromise agreement fixed the amount of just
compensation for the property at P1,454,859.00 which was, as the records show, fully
paid by petitioner as evidenced by the disbursement vouchers (Annexes “D-1” to “D-
12” to complaint). Said compromise agreement had long become final and executory,
before respondent Hernando allegedly executed the “Affidavit of Revocation”
unilaterally revoking the same on November 29, 1985. It is well-settled that a judicial
compromise has the effect of res judicata and is immediately executory and not
appealable unless a motion to set aside the same is filed on the ground of fraud,
mistake or duress, in which event an appeal may be filed from an order denying the
same. A court cannot set aside a judgment based on compromise without having
declared in an incidental hearing that such a compromise is vitiated by any of the
grounds for nullity enumerated in Art. 2038 of the Civil Code. Consequently, it was
utterly erroneous for the trial court to rule that there was such a revocation of the
judicially approved Compromise Agreement.
Same; Documents; Failure to deny the genuineness and due execution of an actionable
document does not preclude a party from arguing against it by evidence of fraud,
mistake, compromise, payment, statute of limitations, estoppel and want of
consideration.—Nonetheless, assuming further that petitioner is a party to the
questioned instruments, still, the dismissal of its complaint by respondent trial court
was not correct. Petitioner’s alleged failure to deny under oath the genuineness and due
execution of the said instruments simply means that it impliedly admitted their
authenticity and due execution. Failure to deny the genuineness and due execution of
an actionable document does not preclude a party from arguing against it by evidence
of fraud, mistake, compromise, payment, statute of limitations, estoppel and want of
consideration. Neither does it bar a party from raising the defense in his answer or
reply and prove at the trial that there is a mistake or imperfection in the writing, or that
it does not express the true agreement of the parties, or that the agreement is invalid or
that there is an intrinsic ambiguity in the writing.
For our consideration is a petition for review on certiorari impugning the Decision
dated February 8, 1993 and the Resolution dated April 27, 1993 of respondent Court of
Appeals in CA-G.R. SP No. 29460. 1
The relevant antecedents are as follows:
Sometime in December 1991, petitioner filed a complaint for rescission (of a deed of
sale), cancellation (of transfer certificates of title), reconveyance and damages with
prayer for issuance of a writ of preliminary injunction and of a temporary restraining
order, against the spouses Rolando Abadilla and Susan Samonte, Harold M. Hernando,
for himself and as attorney-in-fact of Apolinario, Serafin, Dominica and Maria, all
surnamed Quetulio, * and the Register of Deeds of Laoag City, before the Regional
Trial Court of Laoag City, Branch 16, docketed as Civil Case No. 9934-16. It is
alleged in the said complaint that sometime in 1984, the then Ministry of Public Works
and Highways, in collaboration with the then Ministry of Transportation and
Communication filed an expropriation case against Serafin, Apolinario, Dominica and
Maria, all surnamed Quetulio, involving two (2) parcels of land containing an
129
aggregate area of ninety four thousand nine hundred thirteen (94,913) square meters,
for the construction of a terminal building for international flights of the Laoag
International Airport; that said expropriation case was docketed as Civil Case No.
8396-XV and raffled to RTC, Branch XV, Laoag City; that a compromise agreement
was entered into in the said case on January 24, 1985 whereby the parties agreed to fix
the amount of just compensation at One Million Four Hundred Fifty Four Thousand
Eight Hundred Fifty Nine pesos (P1,454,859.00); that a decision was rendered on
January 31, 1985 whereby the trial court approved and adopted in toto the said
compromise agreement; that disbursement vouchers in the amount agreed upon were
turned over to the Quetulios; that on November 29, 1985, Harold M. Hernando
executed an affidavit revoking the compromise agreement he signed as attorney-in-fact
of the Quetulios; that sometime in 1989, the Quetulios, again represented by Harold M.
Hernando, filed a petition for the issuance of another owners' and co-owner's duplicate
copy of TCT-T-1071 and OCT No. 0-145-L before the RTC, Branch XIV of Laoag
City; that said petition was granted on April 18, 1989 and pursuant thereto, owner's
duplicate copy of TCT No. T-1071 and on April 18, 1989 and pursuant thereto,
owner's duplicate copy of TCT No. T-1071 and OCT No. 0-145-L were issued; that
Harold M. Hernando, as attorney-in-fact of the Quetulios, sold the property in question
to the spouses Rolando V. Abadilla and Susan Samonte for and in consideration of the
sum of One Million Three Hundred Pesos (P1,000,300.00); that said second sale is null
and void as the lots in question are already owned by petitioner Republic; and that the
spouses-vendees acted in bad faith as they already had prior knowledge of the first
sale.
Accordingly, petitioner prayed that (1) the deed of sale by Harold M. Hernando in
favor of the spouses Abadilla be declared null and void; (2) TCT Nos T-21484 and T-
21485 covering the lots in question issued in the name of the spouses Abadilla be
declared null and void; (3) the Register of Deeds of Laoag City be directed to cancel
the TCTs and reinstate the old ones; and (4) Harold M. Hernando and the spouses
Abadilla be made liable to pay P500,000.00 by way of actual and punitive damages. 2
The spouses Abadilla filed their Answer in due time on January 28, 1992.
On February 14, 1992, petitioner filed a Reply to the spouses Abadilla's answer.
No answer was filed by respondents Hernando and the Quetulios within the 15-day
reglementary period to file a responsive pleading.
Meanwhile, the initial hearing for the instant case was set for February 27, 1992. Said
hearing was, however, postponed for no apparent reason. Nonetheless, respondent
Harold M. Hernando, who was then present in court, moved that (a) he be granted the
opportunity to formally appear as counsel for himself and his co-defendants as he was
then still serving a five (5) month suspension from the practice of law for malpractice
pursuant to the Resolution of this Court dated October 17, 1991 in Administrative Case
No. 1359 entitled Buted v. Hernando 3 and (b) he be allowed to file an answer despite
petitioner's oral manifestation that he be declared in default for failure to file his
answer within the reglementary period. Both motions were granted by the trial court.
On February 28, 1992, respondent Hernando filed a pleading denominated as
"Comment/Answer/Motion to Dismiss"  4 praying for the dismissal of the complaint on
the basis of the "Affidavit of Revocation" executed by him on November 29, 1985
cancelling the Compromise Agreement because Atty. Sixto S. Pedro allegedly
withheld ten (10) checks in the amount of P500,000.00 which were supposed to be part
of the consideration for the property expropriated; and that Atty. Sixto S. Pedro, in his
capacity as "Special Attorney" for the Ministry of Public Works and Highways, Ilocos
Norte, and representing the Republic of the Philippines, had signed a Rescission of
Compromise Agreement and the Deed of Conveyance dated December 2, 1985 (in
favor of the Abadilla spouses).
On May 5, 1992, the trial court issued an order dismissing the complaint ratiocinating
that:
As the plaintiff has not filed any reply/opposition or comment to the
comment/answer/motion to dismiss, said party is deemed to have admitted the due
execution and genuiness (sic) of the instruments which are exhibits 3 and 4 of the
motion to dismiss, Sec, 8, Rule 8 of the Rules of Court. This is so as said instruments
which are exhibits 3 and 4 are copied verbatim as part of the pleading of defendants
Atty. Harold Hernando and Dominica Quetolio, Sec. 7, Rule 8 of the New Rules of
Court. Plaintiff having admitted the execution and genuiness (sic) of the instruments,
said patty has already abandoned its claim to the land in suit or the claim of said party
plaintiff has been extinguished. 5
Petitioner received a copy of the above-stated order on May 13, 1992.
On May 25, 1992, petitioner filed a Motion for Reconsideration of the order of
dismissal.
The motion was denied in an order received by petitioner on September 14, 1992.
On October 8, 1992, twenty-four (24) days after it received a copy of the order denying
its motion for reconsideration, petitioner filed a petition for certiorari under Rule 65 of
the Rules of Court before this Court, docketed as G.R. No. 107229.
Per our Resolution dated October 12, 1992, G.R. No. 107229 was referred to the Court
of Appeals for appropriate action. Therein, G.R. No. 107229 was docketed anew as
CA-G.R. SP No. 29460.
On February 8, 1993, the Court of Appeals dismissed the said petition
for certiorari after treating the same as an ordinary appeal filed out of time. According
to the appellate court:
130
Considering that petitioner admittedly received a copy of the Order dated 04
September 1992 denying its Motion For Reconsideration on 14 September 1992, the
reglementary period within which to file an appeal therefrom expired on 29 September
1992.
The record discloses that the instant petition was filed on 08 October 1992.
Consequently, the questioned Order had attained finality at the time the petition was
filed. 6
A motion for reconsideration of said decision was denied on April 27, 1993.
Hence, the present petition for review on certiorari grounded on the following
issues, viz.:
I
Whether or not respondent Honorable Court of Appeals has decided a question of
substance, not theretofore determined by the Honorable Supreme Court or that it has
decided it in a way not in accord with law or with applicable decisions of this
Honorable Court, in denying due course to the petition in G.R. SP No. 29460,
purportedly on the ground that the 15-day reglementary period had already elapsed
despite patent showing on the face of the petition that it was filed pursuant to Rule 65
of the Revised Rules of Court.
II
Whether or not respondent Honorable Court of Appeals has patently sanctioned such
departure by respondent Hon. Luis B. Bello, Jr., from the usual and accepted course of
judicial proceeding as he (Judge Bello) considered a mere affidavit as an actionable
document such that petitioner's failure to file an opposition or comment to herein
private respondent-Harold Hernando's pleading wherein said affidavit was attached
and copied, amounted to an admission of its due execution and genuineness, being
allegedly an actionable document, pursuant to Sec. 8, Rule 8 of the Revised Rules of
Court. 7
We grant the petition.
The threshold issue in this case is whether or not respondent Court of Appeals
committed reversible error in denying due course and dismissing CA-GR-SP No.
29460 for having been filed out of time.
Respondent Court of Appeals ruled that an ordinary appeal not a petition
for certiorari under Rule 65, was the proper remedy from the trial court's Order of
dismissal dated May 5, 1992 which has attained finality.
Our careful study of the facts inevitably yields to the conclusion that the Regional Trial
Court presided by Hon. Luis B. Bello, Jr. committed grave abuse of discretion not only
in issuing its order dismissing petitioner's complaint in Civil Case No. 9934 on a
starkly erroneous ground, but also it committed a grossly irresponsible act of allowing
respondent Hernando who was then under suspension from the practice of law, to
represent himself and his co-defendants in the case. Also, as appearing from the
records, after the lapse of the period to file an answer on the part of respondents
Hernando and the Quetulios, the trial court set the case for pre-trial without formally
ruling on petitioner's motion to declare them in default. Surprisingly, the trial court
thereafter, allowed said defendants to file their answer upon the latter's verbal motion.
This enabled respondent Hernando to file his pleading "Comment/Answer/Motion to
Dismiss," with certain annexes which were considered by the trial court as actionable
documents, despite the fact that petitioner was not a party thereto. All these
circumstances clearly demonstrate the trial court's bias and arbitrariness that should
have warranted the setting aside of the questioned order of dismissal for grave abuse of
discretion under Rule 65 of the Rules of Court. Consequently, petitioner's original
action for certiorari filed with respondent Court of Appeals on October 8, 1992 to
annul the trial court's Order dated May 5, 1992 dismissing petitioner's complaint
should have been given due course.
The Compromise Agreement entered into by the petitioner and the Quetulio spouses in
the expropriation case, docketed as Civil Case No. 8396-XV, on January 24, 1985 was
approved and adopted in toto by the Regional Trial Court of Laoag City, Branch XV in
its decision of January 31, 1985. The compromise agreement fixed the amount of just
compensation for the property at P1,454,859.00 which was, as the records show, fully
paid by petitioner as evidenced by the disbursement vouchers (Annexes "D-1" to "D-
12" to complaint). 8 Said compromise agreement had long become final and executory,
before respondent Hernando allegedly executed the "Affidavit of Revocation"
unilaterally revoking the same on November 29, 1985. It is well-settled that a judicial
compromise has the effect of res judicata and is immediately executory and not
appealable unless a motion to set aside the same is filed on the ground of fraud,
mistake or duress, in which event an appeal may be filed from an order denying the
same. 9 A court cannot set aside a judgment based on compromise without having
declared in an incidental hearing that such a compromise is vitiated by any of the
grounds for nullity enumerated in Art. 2038 of the Civil Code. Consequently, it was
utterly erroneous for the trial court to rule that there was such a revocation of the
judicially approved Compromise Agreement.
131
Moreover, considering that petitioner is not a party to the annexes attached to the
Comment/Answer/Motion to Dismiss filed by respondent Hernando and the Quetulios,
the trial court had no legal basis in dismissing petitioner's complaint in Civil Case No.
9934-16 on the ground that petitioner had admitted the due execution and genuineness
of said annexes consisting of the "Affidavit of Revocation," and "Rescission of
Compromise Agreement and Deed of Conveyance."
Sec. 8 of Rule 8 of the Rules of Court provides:
Sec. 8. How to contest genuineness of such documents. - When an action or defense is
founded upon a written instrument, copied in or attached to the corresponding pleading
as provided in the preceding section, the genuineness and due execution of the
instrument shall be deemed admitted unless the adverse party, under oath, specifically
denies them, and sets forth what he claims to be the facts; but this provision does not
apply when the adverse party does not appear to be a party to the instrument  or when
compliance with an order for an inspection of the original instrument is refused.
(Emphasis ours.)
While the signature of Atty. Sixto S. Pedro is found in both instruments, he could not
have, in any way, bound the petitioner thereto for total lack of authority from the latter
to enter into any agreement prejudicial to or in diminution of the rights of the
Government. It is to be noted that the "Affidavit of Revocation" executed on
November 29, 1985 by respondent Hernando repudiated the judgment by compromise
on the ground that Atty. Sixto S. Pedro, alleged Special Attorney of the Ilocos Norte
District of the Public Works, had withheld ten (10) checks in the total mount of
P500,000.00 which were part of the consideration for the property subject of the
Compromise Agreement. The document was signed by Atty. Pedro with the words
"acknowledged and my express conformity." Similarly, the "Rescission of
Compromise Agreement and Deed of Conveyance" was executed by the Quetulios and
signed by Atty. Pedro describing himself as "Special Attorney of the NPWH I.N.
Engineering District and representing the Republic of the Philippines." Even granting
hypothetically that Atty. Pedro was duly designated as Special Attorney of the Office
of the Solicitor General, and was authorized to represent the Solicitor General at the
hearings of the expropriation case, it is still the Solicitor General who retains
supervision and control of the representation of the case and who has to approve
actions involving withdrawal, non-appeal and other matters which appear to
compromise the interest of the Government, not to mention that only notices of orders,
resolutions and decisions served on him will bind the Government. 10 The authority to
enter into any agreement or arrangement adversely affecting the rights and interests of
the Government cannot be assumed; it has to be established by him who asserts its
existence.
Nonetheless, assuming further that petitioner is a party to the questioned instruments,
still, the dismissal of its complaint by respondent trial court was not correct.
Petitioner's alleged failure to deny under oath the genuineness and due execution of the
said instruments simply means that it impliedly admitted their authenticity and due
execution. Failure to deny the genuineness and due execution of an actionable
document does not preclude a party from arguing against it by evidence of fraud,
mistake, compromise, payment, statute of limitations, estoppel and want of
consideration. 11 Neither does it bar a party from raising the defense in his answer or
reply and prove at the trial that there is a mistake or imperfection in the writing, or that
it does not express the true agreement of the parties, or that the agreement is invalid or
that there is an intrinsic ambiguity in the writing. 12
Apart from the aforestated erroneous application of the law, the proceedings conducted
by the respondent judge were grievously tainted by the appearance of respondent
Hernando in the case despite his suspension at the time from the practice of law.
As explicitly stated in the present petition as well as in the petition previously filed in
this case, docketed as G.R. No. 107229 which was referred to the Court of Appeals for
disposition, respondent RTC Judge Luis B. Bello, Jr. did not rule on petitioner's oral
motion to declare the Quetulios in default for not filing their answer within the
reglementary period. Instead, after the case was set for initial hearing on February 27,
1992, the judge admitted the formal appearance of respondent Hernando as counsel for
himself and for his co-defendants and allowed him to file an answer to the complaint.
Evidently, when respondent Hernando appeared before the trial court at the initial
hearing of the case on February 27, 1992, and when he filed the pleading denominated
as Comment/Answer/Motion to Dismiss, he was still under suspension from the
practice of law. A suspended lawyer, during his suspension, is certainly prohibited
from engaging in the practice of law 13 and if he does so, he may be disbarred. The
reason is that, his continuing to practice his profession during his suspension
constitutes a gross misconduct and a wilful disregard of the suspension order, which
should be obeyed though how erroneous it may be until set aside. 14
While as a general rule, certiorari cannot be a substitute for a lapsed appeal, however,
where the rigid application of the rule will result in a manifest failure, or miscarriage of
justice, the rule may be relaxed. 15 Technicalities should be disregarded if only to
accord to the respective parties that which is due them. Therefore, considering the
broader and primordial interests of justice, particularly when there is grave abuse of
discretion as in the case at bar, an occasional departure from the general rule that the
extraordinary writ of certiorari cannot substitute for a lost appeal is warranted. 16 In
the instant case, we rule that respondent court erred in not entertaining the special civil
action for certiorari (CA-G.R. SP No. 29460) before it, considering the patent
irregularity and grave abuse of discretion committed by the trial court in dismissing
petitioner's complaint, such that appeal therefrom was not an adequate remedy in the
ordinary course of law.
132
However, it has not escaped the attention of the Court that the petition in G.R. No.
107229 was filed by the Office of the Solicitor General nine (9) days beyond the
reglementary period. Rules of procedure are intended to insure the orderly
administration of justice and the protection of the substantive rights of the parties in
judicial proceedings. Needless to state, Government lawyers assigned to the case
should have acted more scrupulously and sedulously in seeing to it that their client's
interests are protected by observing deadlines in filing of pleadings to avoid situations
such as that obtaining in this case which involves a valuable property.
WHEREFORE, the instant petition is hereby GRANTED. Civil Case No. 9934-16
before the Regional Trial Court of Laoag City, Branch 16, is hereby REINSTATED
and the court a quo is ORDERED to proceed hearing the case and resolve the same
with dispatch.
SO ORDERED.
Note.—Although certiorari cannot be a substitute for a lapsed appeal, where a rigid
application of that rule will result in a manifest failure or miscarriage of justice, the
rule may be relaxed. (Mejares vs. Reyes, 254 SCRA 425 [1996]) Republic vs. Court of
Appeals, 296 SCRA 171, G.R. No. 110020 September 25, 1998
G.R. No. 111244. December 15, 1997.
ARTURO ALANO, petitioner, vs. THE HONORABLE COURT OF APPEALS,
HON. ENRICO A. LANZANAS, Presiding Judge, Regional Trial Court, Manila,
Branch 37, and ROBERTO CARLOS, respondents.
Actions; Criminal Procedure; Prejudicial Question Doctrine; Words and Phrases; The
doctrine of prejudicial question comes into play in a situation where a civil action and
a criminal action are both pending and there exists in the former an issue which must
be preemptively resolved before the criminal action may proceed, because howsoever
the issue raised in the civil action is resolved would be determinative of the guilt or
innocence of the accused in the criminal action.—The doctrine of prejudicial question
comes into play in a situation where a civil action and a criminal action are both
pending and there exists in the former an issue which must be preemptively resolved
before the criminal action may proceed, because howsoever the issue raised in the civil
action is resolved would be determinative of the guilt or innocence of the accused in
the criminal action. In other words, if both civil and criminal cases have similar issues
or the issue in one is intimately related to the issues raised in the other, then a
prejudicial question would likely exist, provided the other element or characteristic is
satisfied.
Same; Same; Same; Evidence; Admissions; Stipulation of Facts; A stipulation of facts
by the parties in a criminal case is recognized as declarations constituting judicial
admissions, hence, binding upon the parties.—From the foregoing, there is no question
that a stipulation of facts by the parties in a criminal case is recognized as declarations
constituting judicial admissions, hence, binding upon the parties and by virtue of which
the prosecution dispensed with the introduction of additional evidence and the defense
waived the right to contest or dispute the veracity of the statement contained in the
exhibit.
Same; Same; Same; Same; Same; Same; Pre-Trial; The stipulation of facts stated in a
pre-trial order amounts to an admission by a party resulting in the waiver of his right to
present evidence on his behalf.—Accordingly, the stipulation of facts stated in the pre-
trial order amounts to an admission by the petitioner resulting in the waiver of his right
to present evidence on his behalf. While it is true that the right to present evidence is
guaranteed under the Constitution, this right may be waived expressly or impliedly.
Same; Same; Same; Same; Same; Same; Since the suspension of the criminal case due
to a prejudicial question is only a procedural matter, the same is subject to a waiver by
virtue of the prior acts of the accused.—Since the suspension of the criminal case due
to a prejudicial question is only a procedural matter, the same is subject to a waiver by
virtue of the prior acts of the accused. After all, the doctrine of waiver is made solely
for the benefit and protection of the individual in his private capacity, if it can be
dispensed with and relinquished without infringing on any public right and without
detriment to the community at large. Alano vs. Court of Appeals, 283 SCRA 269, G.R.
No. 111244 December 15, 1997
Petitioner Arturo Alano has filed this petition for review of the decision 1 of the Court
of Appeals in CA-G.R. SP No. 28150 which affirmed in toto the order of the Regional
Trial Court of Manila, Branch 372 denying petitioners motion for the suspension of
proceeding of Criminal Case No. 90-84933, entitled People of the Philippines vs.
Arturo Alano as well as his motion for reconsideration.
Criminal Case No. 90-84933 is a prosecution for the crime of estafa. The
information3 alleges:
133
That on or about June 10, 1986, in the City of Manila, Philippines, the said accused did
then and there wilfully, unlawfully and feloniously defraud Roberto S. Carlos in the
following manner, to wit: the said accused, pretending to be still the owner of a parcel
of land with an area of 1,172 square meters, more or less, located at Bicutan, Taguig,
Metro Manila, covered by Tax Declaration No. 120-004-00398, well knowing that he
had previously sold the same to the said Roberto S. Carlos for P30,000.00, sold the
aforesaid property for the second time to one Erlinda B. Dandoy for P87,900.00,
thereby depriving the said Roberto S. Carlos of his rightful ownership/possession of
the said parcel of land, to the damage and prejudice of the said Roberto S. Carlos in the
aforesaid amount of P30,000.00, Philippine currency.
Contrary to law.
Petitioner moved for the suspension of the criminal case on the ground that there was a
prejudicial question pending resolution in another case being tried in the Regional Trial
Court, National Capital Region, Pasig, Branch 68. The case, docketed as Civil Case
No. 55103 and entitled Roberto Carlos and Trinidad M. Carlos v. Arturo Alano, et al.,
concerns the nullity of the sale and recovery of possession and damages. In the
aforementioned Civil Case, private respondent filed a complaint against the petitioner
seeking the annulment of the second sale of said parcel of land made by the petitioner
to a certain Erlinda Dandoy on the premise that the said land was previously sold to
them. In his answer, petitioner contends that he never sold the property to the private
respondents and that his signature appearing in the deed of absolute sale in favor of the
latter was a forgery, hence, the alleged sale was fictitious and inexistent. At this
juncture, it is worth mentioning that the civil case was filed on March 1, 1985, five
years before June 19, 1990 when the criminal case for estafa was instituted.
On October 3, 1991, the trial court denied the petitioners motion as well as a
subsequent motion for reconsideration.
Aggrieved, petitioner filed a petition for certiorari and prohibition before the Court of
Appeals seeking the nullification of the assailed order.
On July 26, 1993,4 the Court of Appeals dismissed the petition for lack of merit, the
decretal portion of which reads:
WHEREFORE, finding no merit to the petition, the same is hereby DISMISSED, with
cost against petitioner.
Hence, this petition.
The only issue in this petition is whether the pendency of Civil Case No. 55103, is a
prejudicial question justifying the suspension of the proceedings in Criminal Case No.
90-84933 filed against the petitioner.
Petitioner alleges that his signature appearing in the first deed of absolute sale in favor
of private respondent was a forgery, such that there was no second sale covering the
said parcel of land. Otherwise stated, if the Court in the said Civil Case rules that the
first sale to herein private respondent was null and void, due to the forgery of
petitioners signature in the first deed of sale, it follows that the criminal case for estafa
would not prosper.
While at first blush there seems to be merit in petitioners claim, we are compelled to
affirm the Court of Appeals findings.
The doctrine of prejudicial question comes into play in a situation where a civil action
and a criminal action are both pending and there exists in the former an issue which
must be preemptively resolved before the criminal action may proceed, because
howsoever the issue raised in the civil action is resolved such resolution would be
determinative of the guilt or innocence of the accused in the criminal action. 5 In other
words, if both civil and criminal cases have similar issues or the issue in one is
intimately related to the issues raised in the other, then a prejudicial question would
likely exist, provided the other element or characteristic is
satisfied.6cräläwvirtualibräry
On the basis of the foregoing and a perusal of the facts obtaining in the case at bar, the
disposition of the issue raised need not unduly detain us. We have already ruled that a
criminal action for estafa (for alleged double sale of property) is a prejudicial question
to a civil action for nullity of the alleged deed of sale and the defense of the alleged
vendor is the forgery of his signature in the deed.7
Notwithstanding the apparent prejudicial question involved, the Court of Appeals still
affirmed the Order of the trial court denying petitioners motion for the suspension of
the proceeding on the ground that petitioner, in the stipulation of facts, had already
admitted during the pre-trial order dated October 5, 1990 of the criminal case the
validity of his signature in the first deed of sale between him and the private
respondent, as well as his subsequent acknowledgment of his signature in twenty-three
(23) cash vouchers evidencing the payments made by the private
respondent. 8 Moreover, it was also noted by the Court of Appeals that petitioner even
wrote to the private respondent offering to refund whatever sum the latter had paid.9
In this regard, the pre-trial provision on criminal procedure found in Rule 118 of the
Rules of Court provides:
Sec. 2. Pre-trial conference; subjects. x x x. The pre-trial conference shall consider the
following:
(a) Plea bargaining
(b)Stipulation of facts
134
From the foregoing, there is no question that a stipulation of facts by the parties in a
criminal case is recognized as declarations constituting judicial admissions, hence,
binding upon the parties10 and by virtue of which the prosecution dispensed with the
introduction of additional evidence and the defense waived the right to contest or
dispute the veracity of the statement contained in the exhibit.11

Accordingly, the stipulation of facts stated in the pre-trial order amounts to an

admission by the petitioner resulting in the waiver of his right to present evidence on
his behalf. While it is true that the right to present evidence is guaranteed under the
Constitution,12 this right may be waived expressly or impliedly.13

Since the suspension of the criminal case due to a prejudicial question is only a
procedural matter, the same is subject to a waiver by virtue of the prior acts of the
accused. After all, the doctrine of waiver is made solely for the benefit and protection
of the individual in his private capacity, if it can be dispensed with and relinquished
without infringing on any public right and without detriment to the community at
large.14

Accordingly, petitioners admission in the stipulation of facts during the pre-trial of the
criminal amounts to a waiver of his defense of forgery in the civil case. Hence, we
have no reason to nullify such waiver, it being not contrary to law, public order, public
policy, morals or good customs, or prejudicial to a third person with a right recognized
by law.15 Furthermore, it must be emphasized that the pre-trial order was signed by the
petitioner himself. As such, the rule that no proof need be offered as to any facts
admitted at a pre-trial hearing applies.16
WHEREFORE, in view of the foregoing, the appealed decision of the Court of
Appeals dated July 26, 1993 is AFFIRMED. Costs against petitioner.
SO ORDERED.
Notes.—There is no prejudicial question where one case is administrative and the other
civil. (Ocampo vs. Buenaventura, 55 SCRA 267 [1974])
The rationale behind the principle of prejudicial question is to avoid two conflicting
decisions. (Tuanda vs. Sandiganbayan, 249 SCRA 342 [1995] Alano vs. Court of
Appeals, 283 SCRA 269, G.R. No. 111244 December 15, 1997
G.R. No. 119220. September 20, 1996
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. NILO SOLAYAO,
accused-appellant.
Criminal Law; Illegal Possession of Firearm; Evidence; Essential elements to prove the
crime of illegal possession of firearm.—This Court, in the case of People v. Lualhati
ruled that in crimes involving illegal possession of firearm, the prosecution has the
burden of proving the elements thereof, viz: (a) the existence of the subject firearm and
(b) the fact that the accused who owned or possessed it does not have the
corresponding license or permit to possess the same.
Same; Same; Same; Search Warrant; The case at bar constitutes an instance where a
search and seizure may be effected without first making an arrest.—As with Posadas,
the case at bar constitutes an instance where a search and seizure may be effected
without first making an arrest. There was justifiable cause to “stop and frisk” accused-
appellant when his companions fled upon seeing the government agents. Under the
circumstances, the government agents could not possibly have procured a search
warrant first.

Same; Same; Same; Same; There was no violation of the constitutional guarantee
against unreasonable searches and seizures.—Thus, there was no violation of the
constitutional guarantee against unreasonable searches and seizures. Nor was there
error on the part of the trial court when it admitted the homemade firearm as evidence.

135
Same; Same; Same; The absence of license and legal authority constitutes an essential
ingredient of the offense of illegal possession of firearm and every ingredient or
essential element of an offense must be shown by the prosecution by proof beyond
reasonable doubt.—Undoubtedly, it is the constitutional presumption of innocence that
lays such burden upon the prosecution. The absence of such license and legal authority
constitutes an essential ingredient of the offense of illegal possession of firearm, and
every ingredient or essential element of an offense must be shown by the prosecution
by proof beyond reasonable doubt.
Same; Same; Same; An admission in criminal cases is insufficient to prove beyond
reasonable doubt the commission of the crime charged.—By its very nature, an
“admission is the mere acknowledgment of a fact or of circumstances from which guilt
may be inferred, tending to incriminate the speaker, but not sufficient of itself to
establish his guilt.” In other words, it is a “statement by defendant of fact or facts
pertinent to issues pending, in connection with proof of other facts or circumstances, to
prove guilt, but which is, of itself, insufficient to authorize conviction.” From the
above principles, this Court can infer that an admission in criminal cases is insufficient
to prove beyond reasonable doubt the commission of the crime charged. People vs.
Solayao, 262 SCRA 255, G.R. No. 119220 September 20, 1996
Accused-appellant Nilo Solayao was charged before the Regional Trial Court of Naval,
Biliran, Branch 16, with the crime of illegal possession of firearm and
ammunition 1 defined and penalized under Presidential Decree No. 1866.
The lone prosecution witness, SPO3 Jose Niño, narrated that at about 9:00 o'clock in
the evening of July 9, 1992, with CAFGU members Teofilo Llorad, Jr. and Cecilio
Cenining, he went to Barangay Caulangohan, Caibiran, Biliran. They were to conduct
an intelligence patrol as required of them by their intelligence officer to verify reports
on the presence of armed persons roaming around the barangays of Caibiran. 2
From Barangay Caulangohan, the team of Police Officer Niño proceeded to Barangay
Onion where they met the group of accused-appellant Nilo Solayao numbering five.
The former became suspicious when they observed that the latter were drunk and that
accused-appellant himself was wearing a camouflage uniform or a jungle suit.
Accused-appellant's companions, upon seeing the government agents, fled. 3
Police Officer Niño told accused-appellant not to run away and introduced himself as
"PC," after which he seized the dried coconut leaves which the latter was carrying and
found wrapped in it a 49-inch long homemade firearm locally know as "latong." When
he asked accused-appellant who issued him a license to carry said firearm or whether
he was connected with the military or any intelligence group, the latter answered that
he had no permission to possess the same. Thereupon, SPO3 Niño confiscated the
firearm and turned him over to the custody of the policemen of Caibiran who
subsequently investigated him and charged him with illegal possession of firearm. 4
Accused-appellant, in his defense, did not contest the confiscation of the shotgun but
averred that this was only given to him by one of his companions, Hermogenes
Cenining, when it was still wrapped in coconut leaves. He claimed that he was not
aware that there was a shotgun concealed inside the coconut leaves since they were
using the coconut leaves as a torch. He further claimed that this was the third torch
handed to him after the others had been used up. 5 Accused-appellant's claim was
corroborated by one Pedro Balano that he indeed received a torch from Hermogenes
Cenining which turned out to be a shotgun wrapped in coconut leaves. 6
On August 25, 1994, the trial court found accused-appellant guilty of illegal possession
of firearm under Section 1 of Presidential Decree No. 1866 and imposed upon him the
penalty of imprisonment ranging from reclusion temporal maximum to reclusion
perpetua. The trial court, having found no mitigating but one aggravating circumstance
of nighttime, sentenced accused-appellant to suffer the prison term of reclusion
perpetua with the accessory penalties provided by law. 7 It found that accused-
appellant did not contest the fact that SPO3 Niño confiscated the firearm from him and
that he had no permit or license to possess the same. It hardly found credible accused-
appellant's submission that he was in possession of the firearm only by accident and
that upon reaching Barangay Onion, he followed four persons, namely, Hermogenes
Cenining, Antonio Sevillano, Willie Regir and Jovenito Jaro when he earlier claimed
that he did not know his companions. 8
Accused-appellant comes to this Court on appeal and assigns the following errors:
I. The trial court erred in admitting in evidence the homemade firearm.
II. The trial court erred in appreciating the aggravating circumstance of nighttime in
the imposition of the maximum penalty against the accused-appellant. 9
This court, in the case of People v. Lualhati10 ruled that in crimes involving illegal
possession of firearm, the prosecution has the burden of proving the elements
thereof, viz: (a) the existence of the subject firearm and (b) the fact that the accused
who owned or possessed it does not have the corresponding license or permit to
possess the same.
In assigning the first error, accused-appellant argued that the trial court erred in
admitting the subject firearm in evidence as it was the product of an unlawful
warrantless search. He maintained that the search made on his person violated his
constitutional right to be secure in his person and effects against unreasonable searches
and seizures. Not only was the search made without a warrant but it did not fall under
any of the circumstances enumerated under Section 5, Rule 113 of the 1985 Rules on
Criminal Procedure which provides, inter alia:
136
A peace officer or a private person may, without a warrant, arrest a person when in his
presence, the person to be arrested has committed, is actually committing, or is
attempting to commit an offense.
Hence, the search being unlawful, the homemade firearm confiscated from him is
inadmissible in evidence for being "the fruit of the poisonous
tree." 11 As such, the prosecution's case must necessarily fail and the accused-appellant
acquitted.
Accused-appellant's arguments follow the line of reasoning in People v. Cuizon, et
al. 12 where this Court declared: ". . . emphasis is to be laid on the fact that the law
requires that the search be incident to a lawful arrest, in order that the search itself may
likewise be considered legal. Therefore, it is beyond cavil that a lawful arrest must
precede the search of a person and his belongings. Were a search first undertaken, then
an arrest effected based on evidence produced by the search, both such search and
arrest would be unlawful, for being contrary to law."
Under the circumstances obtaining in this case, however, accused-appellant's
arguments are hardy tenable. He and his companions' drunken actuations aroused the
suspicion of SPO3 Niño's group, as well as the fact that he himself was attired in a
camouflage uniform or a jungle suit 13 and that upon espying the peace officers, his
companions fled. It should be noted that the peace officers were precisely on an
intelligence mission to verify reports that armed persons were roaming around the
barangays of Caibiran. 14
The circumstances in this case are similar to those obtaining in Posadas v. Court of
Appeals 15 where this Court held that "at the time the peace officers identified
themselves and apprehended the petitioner as he attempted to flee, they did not know
that he had committed, or was actually committing the offense of illegal possession of
firearm and ammunitions. They just suspended that he was hiding something in the
buri bag. They did not know what its contents were. The said circumstances did not
justify an arrest without a warrant."
This Court, nevertheless, ruled that the search and seizure in the Posadas case brought
about by the suspicious conduct of Posadas himself can be likened to a "stop and frisk"
situation. There was probable cause to conduct a search even before an arrest could be
made.
In the present case, after SPO3 Niño told accused-appellant not to run away, the former
identified himself as a government agents. 16 The peace officers did not know that he
had committed, or was actually committing, the offense of illegal possession of
firearm. Tasked with verifying the report that there were armed men roaming in the
barangays surrounding Caibiran, their attention was understandably drawn to the group
that had aroused their suspicion. They could not have known that the object wrapped in
coconut leaves which accused-appellant was carrying hid a firearm.
As with Posadas, the case at bar constitutes an instance where a search and seizure
may be effected without first making an arrest. There was justifiable cause to "stop and
frisk" accused-appellant when his companions filed upon seeing the government
agents. Under the circumstances, the government agents could not possibly have
procured a search warrant first.
Thus, there was no violation of the constitutional guarantee against unreasonable
searches and seizures. Nor was there error on the part of the trial court when it
admitted the homemade firearm as evidence.
As to the question of whether or not the prosecution was able to prove the second
element, that is, the absence of a license or permit to possess the subject firearm, this
Court agrees with the Office of the Solicitor General which pointed out that the
prosecution failed to prove that accused-appellant lacked the necessary permit or
license to possess the subject firearm. 17
Undoubtedly, it is the constitutional presumption of innocence that lays such burden
upon the prosecution. The absence of such license and legal authority constitutes an
essential ingredient of the offense of illegal possession of firearm, and every ingredient
or essential element of an offense must be shown by the prosecution by proof beyond
reasonable doubt. 18
In People v. Tiozon, 19 this Court said:
It is true that People vs. Lubo, 101 Phil. 179 and People vs. Ramos, 8 SCRA 758 could
be invoked to support the view that it is incumbent upon a person charged with illegal
possession of a firearm to prove the issuance to him of a license to possess the firearm,
but we are of the considered opinion that under the provisions of Section 2, Rule 131
of the Rules of Court which provide that in criminal cases the burden of proof as to the
offense charged lies on the prosecution and that a negative fact alleged by the
prosecution must be proven if "it is an essential ingredient of the offense charged," the
burden of proof was with the prosecution in this case to prove that the firearm used by
appellant in committing the offense charged was not properly licensed.
It cannot be denied that the lack or absence of a license is an essential ingredient of the
offense of illegal possession of a firearm. The information filed against appellant in
Criminal Case No. 3558 of the lower court (now G.R. No. 27681) specifically alleged
that he had no "license or permit to possess" the .45 caliber pistol mentioned therein.
Thus it seems clear that it was the prosecution's duty not merely to allege that negative
fact but to prove it. This view is supported by similar adjudicated cases.
In U.S. vs. Tria, 17 Phil. 303, the accused was charged with "having criminally
inscribed himself as a voter knowing that he had none of the qualifications required to
137
be a voter. It was there held that the negative fact of lack of qualification to be a voter
was an essential element of the crime charged and should be proved by the
prosecution. In another case (People vs. Quebral. 68 Phil. 564) where the accused was
charged with illegal practice of medicine because he had diagnosed, treated and
prescribed for certain diseases suffered by certain patients from whom he received
monetary compensation, without having previously obtained the proper certificate of
registration from the Board of Medical Examiners, as provided in Section 770 of the
Administrative Code, this Court held that if the subject of the negative averment like,
for instance, the act of voting without the qualifications provided by law is an essential
ingredient of the offense charged, the prosecution has the burden of proving the same,
although in view of the difficulty of proving a negative allegation, the prosecution,
under such circumstance, need only establish a prima facie case from the best evidence
obtainable. In the case before Us, both appellant and the Solicitor General agree that
there was not even a prima facie case upon which to hold appellant guilty of the illegal
possession of a firearm. Former Chief Justice Moral upholds this view as follows:
The mere fact that the adverse party has the control of the better means of proof of the
fact alleged, should not relieve the party making the averment of the burden of proving
it. This is so, because a party who alleges a fact must be assumed to have acquired
some knowledge thereof, otherwise he could not have alleged it. Familiar instance of
this is the case of a person prosecuted for doing an act or carrying on a business, such
as, the sale of liquor without a license. How could the prosecution aver the want of a
license if it had acquired no knowledge of that fact? Accordingly, although proof of the
existence or non-existence of such license can, with more facility, be adduced by the
defendant, it is nevertheless, encumber upon the party alleging the want of the license
to prove the allegation. Naturally, as the subject matter of the averment is one which
lies peculiarly within the control or knowledge of the accused prima facie evidence
thereof on the part of the prosecution shall suffice to cast the onus upon him." (6
Moran, Comments on the Rules of Court, 1963 edition, p. 8).
Finally, the precedents cited above have been crystallized as the present governing
case law on this question. As this Court summed up the doctrine in People
v. Macagaling: 20
We cannot see how the rule can be otherwise since it is the inescapable duty of the
prosecution to prove all the ingredients of the offense as alleged against the accused in
an information, which allegations must perforce include any negative element provided
by the law to integrate that offense. We have reiterated quite recently the fundamental
mandate that since the prosecution must allege all the elements of the offense charged,
then it must prove by the requisite quantum of evidence all the elements it has thus
alleged.
In the case at bar, the prosecution was only able to prove by testimonial evidence that
accused-appellant admitted before Police Officer Niño at the time that he was accosted
that he did not have any authority or license to carry the subject firearm when he was
asked if he had one. 21 In other words, the prosecution relied on accused-appellant's
admission to prove the second element.
Is this admission sufficient to prove beyond reasonable doubt the second element of
illegal possession of firearm which is that accused-appellant does not have the
corresponding license? Corollary to the above question is whether an admission by the
accused-appellant can take the place of any evidentiary means establishing beyond
reasonable doubt the fact averred in the negative in the pleading and which forms an
essential ingredient of the crime charged.
This Court answers both questions in the negative. By its very nature, an "admission is
the mere acknowledgment of a fact or of circumstance from which guilt may be
inferred, tending to incriminate the speaker, but not sufficient of itself to establish his
guilt." 22 In other words, it is a "statement by defendant of fact or facts pertinent to
issues pending, in connection with proof of other facts or circumstances, to prove guilt,
but which is, of itself, insufficient to authorize conviction." 23 From the above
principles, this Court can infer that an admission in criminal cases is insufficient to
prove beyond reasonable doubt the commission of the crime charged.
Moreover, said admission is extra-judicial in nature. As such, it does not fall under
Section 4 of Rule 129 of the Revised Rules of Court which states:
An admission, verbal or written, made by a party in the course of the trial or other
proceedings in the same case does not require proof.
Not being a judicial admission, said statement by accused-appellant does not prove
beyond reasonable doubt the second element of illegal possession of firearm. It does
not even establish a prima facie case. It merely bolsters the case for the prosecution
but does not stand as proof of the fact of absence or lack of a license.
This Court agrees with the argument of the Solicitor General that "while the
prosecution was able to establish the fact that the subject firearm was seized by the
police from the possession of appellant, without the latter being able to present any
license or permit to possess the same, such fact alone is not conclusive proof that he
was not lawfully authorized to carry such firearm. In other words, such fact does not
relieve the prosecution from its duty to establish the lack of a license or permit to carry
the firearm by clear and convincing evidence, like a certification from the government
agency concerned." 24
Putting it differently, "when a negative is averred in a pleading, or a plaintiff's case
depends upon the establishment of a negative, and the means of proving the fact are
equally within the control of each party, then the burden of proof is upon the party
averring the negative." 25
138
In this case, a certification from the Firearms and Explosives Unit of the Philippine
National Police that accused-appellant was not a licensee of a firearm of any kind or
caliber would have sufficed for the prosecution to prove beyond reasonable doubt the
second element of the crime of illegal possession of firearm.
In view of the foregoing, this Court sees no need to discuss the second assigned error.
WHEREFORE, the assailed judgment of the court a quo is REVERSED and SET
ASIDE. Accused-appellant Nilo Solayao is hereby ACQUITTED for insufficiency of
evidence and ordered immediately released unless there are other legal grounds for his
continued detention, with cost de oficio.
SO ORDERED.
FACTUM PROBANDUM and FACTUM PROBANS
G.R. No. 89114. December 2, 1991
FRANCISCO S. TANTUICO, JR., petitioner, vs. REPUBLIC OF THE
PHILIPPINES, PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT,
MATEO A.T. CAPARAS, AND THE SANDIGANBAYAN, respondents.
Remedial Law; Pleadings and Practices; Nature of a complaint.—A complaint is
defined as a concise statement of the ultimate facts constituting the plaintiff ‘s cause or
causes of action. Like all other pleadings allowed by the Rules of Court, the complaint
shall contain in a methodical and logical form a plain, concise and direct statement of
the ultimate facts on which the plaintiff relies for his claim, omitting the statement of
mere evidentiary facts. Its office, purpose or function is to inform the defendant clearly
and definitely of the claims made against him so that he may be prepared to meet the
issues at the trial. The complaint should inform the defendant of all the material facts
on which the plaintiff relies to support his demand; it should state the theory of a cause
of action which forms the bases of the plaintiffs claim of liability.
Same; Same; Same; Rules on pleading speak of two kinds of facts, the ultimate facts
and the evidentiary facts.—The rules on pleading speak of two (2) kinds of facts: the
first, the “ultimate facts”, and the second, the “evidentiary facts.”
Same; Same; Same; Same; Ultimate facts and evidentiary facts defined.—"The term
‘ultimate facts’ as used in Sec. 3, Rule 3 of the Rules of Court, means the essential
facts constituting the plaintiffs cause of action. A fact is essential if it cannot be
stricken out, without leaving the statement of the cause of action insufficient, x x x”,
(Moran, Rules of Court, Vol. 1,1963 ed., p. 213). “Ultimate facts are important and
substantial facts which either directly form the basis of the primary right and duty, or
which directly make up the wrongful acts or omissions of the defendant. The term does
not refer to the details of probative matter or particulars of evidence by which these
material elements are to be established. It refers to principal, determinate, constitutive
facts, upon the existence of which, the entire cause of action rests.” while the term
“evidentiary fact” has been denned in the following tenor: “Those facts which are
necessary for determination of the ultimate facts; they are the premises upon which
conclusions of ultimate facts are based. Womack v. Industrial Comm., 168 Colo. 364,
451 P.2d 761, 764. Facts which furnish evidence of existence of some other fact.”
Same; Same; Same; Bill of Particulars; Where the allegations of the complaint are
vague, indefinite or in the form of conclusions, the proper recourse would be not a
motion to dismiss but a motion for a bill of particulars.—Where the complaint states
ultimate facts that constitute the three (3) essential elements of a cause of action,
namely: (1) the legal right of the plaintiff, (2) the correlative obligation of the
defendant, and (3) the act or omission of the defendant in violation of said legal right,
the complaint states a cause of action, otherwise, the complaint must succumb to a
motion to dismiss on that ground of failure to state a cause of action. However, where
the allegations of the complaint are vague, indefinite, or in the form of conclusions, the
proper recourse would be, not a motion to dismiss, but a motion for a bill of
particulars.
Same; Same; Same; Same; Allegations in the complaint are deficient in that they
merely articulate conclusions of law and presumptions unsupported by factual
139
premises.—The allegations in the complaint, above-referred to, pertaining to petitioner
are, therefore, deficient in that they merely articulate conclusions of law and
presumptions unsupported by factual premises. Hence, without the particulars prayed
for in petitioner’s motion for a bill of particulars, it can be said the petitioner can not
intelligently prepare his responsive pleading and for trial.
Same; Same; Same; Same; Same; The particulars prayed for are not evidentiary in
nature.—Furthermore, the particulars prayed for, such as, names of persons, names of
corporations, dates, amounts involved, a specification of property for identification
purposes, the particular transactions involving withdrawals and disbursements, and a
statement of other material facts as would support the conclusions and inferences in the
complaint, are not evidentiary in nature. On the contrary, those particulars are material
facts that should be clearly and definitely averred in the complaint in order that the
defendant may, in fairness, be informed of the claims made against him to the end that
he may be prepared to meet the issues at the trial.
Same; Same; Same; Same; Purpose or object of a bill of particulars.—Thus, it has been
held that the purpose or object of a bill of particulars is—"x x x to amplify or limit a
pleading, specify more minutely and particularly a claim or defense set up and pleaded
in general terms, give information, not contained in the pleading, to the opposite party
and the court as to the precise nature, character, scope, and extent of the cause of
action or defense relied on by the pleader, and apprise the opposite party of the case
which he has to meet, to the end that the proof at the trial may be limited to the matters
specified, and in order that surprise at, and needless preparation for, the trial may be
avoided, and that the opposite party may be aided in framing his answering pleading
and preparing for trial. It has also been stated that it is the function or purpose of a bill
of particulars to define, clarify, particularize, and limit or circumscribe the issues in the
case, to expedite the trial, and assist the court. A general function or purpose of a bill
of particulars is to prevent injustice or do justice in the case when that cannot be
accomplished without the aid of such a bill.”
Same; Same; Same; Same; In a motion for a bill of particulars the only question to be
resolved is whether or not the allegations of the complaint are averred with sufficient
definiteness or particularity to enable the movant properly to prepare his responsive
pleading and to prepare for trial.—Anent the contention of the Solicitor General that
the petitioner is not entitled to a bill of particulars because the ultimate facts
constituting the three (3) essential elements of a cause of action for recovery of ill-
gotten wealth have been sufficiently alleged in the complaint, it would suffice to state
that in a motion for a bill of particulars, the only question to be resolved is whether or
not the allegations of the complaint are averred with sufficient definiteness or
particularity to enable the movant properly to prepare his responsive pleading and to
prepare for trial. Tantuico, Jr. vs. Republic, 204 SCRA 428, G.R. No. 89114 December
2, 1991
In this petition for certiorari, mandamus and prohibition with a prayer for the issuance
of a writ of preliminary injunction and/or restraining order, the petitioner seeks to
annul and set aside the resolution of the Sandiganbayan, dated 21 April 1989, denying
his motion for a bill of particulars as well as its resolution, dated 29 May 1989, which
denied his motion for reconsideration; to compel the respondent PCGG to prepare and
file a bill of particulars, or that said respondent be ordered to exclude petitioner as
defendant in Civil Case No. 0035 should they fail to submit the said bill of particulars;
and to enjoin the respondent Sandiganbayan from further proceeding against petitioner
until the bill of particulars is submitted, claiming that the respondent Sandiganbayan
acted with grave abuse of discretion amounting to lack of jurisdiction in promulgating
the aforesaid resolutions and that there is no appeal, nor any plain, speedy and
adequate remedy for him in the ordinary course of law other than the present petition.
As prayed for, this Court issued on 1 August 1989 a temporary restraining order
"effective immediately and continuing until further orders from this Court, ordering the
respondent Sandiganbayan to CEASE and DESIST from further proceeding in Civil
Case No. 0035 (PCGG 35), entitled "Republic of the Philippines vs. Benjamin (Kokoy)
Romualdez, et al." pending before it. 1
The antecedents are as follows:
On 31 July 1987, the Republic of the Philippines, represented by the PCGG, and
assisted by the Office of the Solicitor General, filed with the Sandiganbayan Civil Case
No. 0035, entitled "Republic of the Philippines vs. Benjamin (Kokoy) Romualdez, et
al." for reconveyance, reversion, accounting, restitution and damages. 2
The principal defendants in the said Civil Case No. 0035 are Benjamin (Kokoy)
Romualdez, Ferdinand E. Marcos and Imelda R. Marcos.
Petitioner Francisco S. Tantuico, Jr. was included as defendant in Civil Case No. 0035
on the theory that: (1) he acted in unlawful concert with the principal defendants in the
misappropriation and theft of public funds, plunder of the nation's wealth, extortion,
blackmail, bribery, embezzlement and other acts of corruption, betrayal of public trust
and brazen abuse of power; 3 (2) he acted as dummy, nominee or agent, by allowing
himself to be incorporator, director, board member and/or stockholder of corporations
beneficially held and/or controlled by the principal defendants; 4 (3) he acted singly or
collectively, and/or in unlawful concert with one another, in flagrant breach of public
trust and of their fiduciary obligations as public officers, with gross and scandalous
abuse of right and power and in brazen violation of the Constitution and laws of the
Philippines, embarked upon a systematic plan to accumulate ill-gotten wealth ; 5 (4) he
(petitioner) taking undue advantage of his position as Chairman of the Commission on
Audit and with grave failure to perform his constitutional duties as such Chairman,
acting in concert with defendants Ferdinand E. Marcos and Imelda R. Marcos,
facilitated and made possible the withdrawals, disbursements and questionable use of
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government funds; 6 and (5) he acted as dummy, nominee and/or agent by allowing
himself to be used as instrument in accumulating ill-gotten wealth through government
concessions, orders and/or policies prejudicial to plaintiff, or to be incorporator,
director, or member of corporations beneficially held and/or controlled by defendants
Ferdinand E. Marcos, Imelda R. Marcos, Benjamin (Kokoy) Romualdez and Juliette
Gomez Romualdez in order to conceal and prevent recovery of assets illegally
obtained. 7
On 11 April 1988, after his motion for production and inspection of documents 8 was
denied by respondent court in its resolution 9 dated 9 March 1988, petitioner filed a
Motion for a Bill of Particulars, 10 alleging inter alia that he is sued for acts allegedly
committed by him as (a) a public officer-Chairman of the Commission on Audit, (b) as
a private individual, and (c) in both capacities, in a complaint couched in too general
terms and shorn of particulars that would inform him of the factual and legal basis
thereof, and that to enable him to understand and know with certainty the particular
acts allegedly committed by him and which he is now charged with culpability, it is
necessary that plaintiff furnish him the particulars sought therein relative to the
averments in paragraphs 2, 9(a), 15, 7 and 17 of the Second Amended Complaint so
that he can intelligently prepare his responsive pleading and prepare for trial. The
particulars sought for in the said motion are as follows:
a. Relative to the averments in paragraphs 2, 9(a) and l5 of the Second Amended
Complaint:
i) What are the dates of the resolutions (if on appeal) or the acts (if otherwise)
issued or performed by herein defendant which allowed the facilitation of, and
made possible the, withdrawals, disbursements and questionable use of
government funds;
ii) What ministries or Departments, offices or agencies of the government
were involved in these questionable use of government funds;
iii) What are the names of the auditors who had the original audit jurisdiction
over the said withdrawals, disbursements and questionable use of government
funds;
iv) How much government funds were involved in these questionable-
disbursements, individually and in totally?
v) Were the disbursements brought to herein defendant for action on pre-
audit, post-audit or otherwise or where they initiated and/or allowed release
by herein defendant alone, without them undergoing usual governmental audit
procedures, or in violation thereof.?
vi) What were herein defendant's other acts or omission or participation in the
matter of allowing such disbursements and questionable use of government
funds, if any?
b. Relative to paragraphs 7 and 17 of the Second Amended Complaint:
i) In what particular contract, dealing, transaction and/or relationship of any
nature of Ferdinand E. Marcos, Imelda R. Marcos, Juliette Gomez Romualdez
or Benjamin T. Romualdez did herein defendant act as dummy, nominee or
agent? Please specify the dealings, the dates, the corporations or entities
involved, the government offices involved and the private and public
documents, if any, showing herein defendant's complicity, since he is not
aware of any such instance. More basically, please specify whether the
defendant is a dummy or nominee or agent and of which corporation or
transaction?
ii) What particular government concession, order and/or policy obtained by
Ferdinand E. Marcos, or Imelda R. Marcos, or Juliette Gomez Romualdez
and/or Benjamin T. Romualdez allowed them either singly or jointly to
accumulate ill-gotten wealth by using herein defendant as instrument for their
accomplishment. Likewise please identify the nature of the transactions, the
dates and the document showing complicity on the part of herein defendant;
he is not aware of any such instance.
iii) Please specify the name or denominate the particular government
concession, order and/or policy prejudicial to the interest of the government
which was obtained by either of the above-named four defendants through the
participation of herein defendant as a dummy, nominee or agent of herein
defendant. Please likewise identify the government office involved, the dates
and other particulars, likewise defendant is not aware of any such instance.
iv) Please name and specify the corporation whether stock or non-stock,
whether government or private, beneficially held and/or controlled by either
of the four above defendants, where herein defendant is an incorporator,
director or member and where his inclusion as such incorporator, director or
member of the corporation was made in order to conceal and prevent recovery
of assets illegally obtained by the aforementioned four defendants, how many
shares are involved and what are their values, how and when have they been
acquired.
The Solicitor General, for and in behalf of respondents (except the respondent
Sandiganbayan), opposed the motion. 11 After the petitioner had filed his reply 12
thereto, the respondent Sandiganbayan promulgated on 21 April 1990 a resolution 13
141
denying the petitioner's motion for a bill of particulars on the ground that the
particulars sought by petitioner are evidentiary in nature, the pertinent part of which
resolution reads, as follows:
We are of the considered opinion that the allegations in the Expanded Complaint are
quite clear and sufficient enough for defendant-movant to know the nature and scope
of the causes of action upon which plaintiff seeks relief. They provide the factual
scenario which, coupled with other allegations set forth in the "Common Averments"
and further specified in the "Specific Averments" of herein defendant-movant and his
co-defendants' illegal acts which are within defendant-movant's peculiar and intimate
knowledge as a government official and corporate executive, will enable him to make
the proper admission, denials or qualifications, set out affirmative and/or special
defenses and thereafter prepare for trial. Evidentiary facts or matters are not essential
in the pleading of the cause of action, nor to details or probative value or particulars of
evidence by which these material evidence are to be established (Remitere vs. Yulu, 6
SCRA 251). The matters which he seeks are evidentiary in nature and, being within his
intimate or personal knowledge, may be denied or admitted by him or if deemed
necessary, be the subject of other forms of discovery. 14
Petitioner moved for reconsideration 15 but this was denied by respondent
Sandiganbayan in its resolution 16 dated 29 May 1990.
Hence, petitioner filed the present petition.
The principal issue to be resolved in the case at bar is whether or not the respondent
Sandiganbayan acted with grave abuse of discretion in issuing the disputed resolutions.
Petitioner argues that the allegations of the Second Amended Complaint in Civil Case
No. 0035 (PCGG 35) pertaining to him state only conclusions of fact and law,
inferences of facts from facts not pleaded and mere presumptions, not ultimate facts as
required by the Rules of Court.
On the other hand, the respondent Sandiganbayan, by and through the Solicitor
General, contends that the essential elements of an action for recovery of ill-gotten
wealth are: (1) an accumulation of assets, properties and other possessions; (2) of
former President Ferdinand E. Marcos, Mrs. Imelda Romualdez Marcos, their close
relatives, subordinates, business associates, dummies, agents, or nominees; and (3)
whose value is out of proportion to their known lawful income, and that the ultimate
facts establishing these three (3) essential elements of an action for recovery of ill-
gotten wealth are sufficiently alleged in the complaint. Hence, petitioner is not entitled
to a bill of particulars.
A complaint is defined as a concise statement of the ultimate facts constituting the
plaintiff's cause or causes of action. 17 Like all other pleadings allowed by the Rules of
Court, 18 the complaint shall contain in a methodical and logical form a plain, concise
and direct statement of the ultimate facts on which the plaintiff relies for his claim,
omitting the statement of mere evidentiary facts. 19 Its office, purpose or function is to
inform the defendant clearly and definitely of the claims made against him so that he
may be prepared to meet the issues at the trial. The complaint should inform the
defendant of all the material facts on which the plaintiff relies to support his demand; it
should state the theory of a cause of action which forms the bases of the plaintiff's
claim of liability. 20
The rules on pleading speak of two (2) kinds of facts: the first, the "ultimate facts", and
the second, the "evidentiary facts." In Remitere vs. Vda. de Yulo, 21 the term "ultimate
facts" was defined and explained as follows:
The term "ultimate facts" as used in Sec. 3, Rule 3 of the Rules of Court, means the
essential facts constituting the plaintiffs cause of action. A fact is essential if it cannot
be stricken out without leaving the statement of the cause of action insufficient. . . .
(Moran, Rules of Court, Vol. 1, 1963 ed., p. 213).
Ultimate facts are important and substantial facts which either directly form the basis
of the primary right and duty, or which directly make up the wrongful acts or
omissions of the defendant. The term does not refer to the details of probative matter or
particulars of evidence by which these material elements are to be established. It refers
to principal, determinate, constitutive facts, upon the existence of which, the entire
cause of action rests.
while the term "evidentiary fact" has been defined in the following tenor:
Those facts which are necessary for determination of the ultimate facts; they are the
premises upon which conclusions of ultimate facts are based. Womack v. Industrial
Comm., 168 Colo. 364,451 P. 2d 761, 764. Facts which furnish evidence of existence
of some other fact. 22
Where the complaint states ultimate facts that constitute the three (3) essential
elements of a cause of action, namely: (1) the legal right of the plaintiff, (2) the
correlative obligation of the defendant, and (3) the act or omission of the defendant in
violation of said legal right, the complaint states a cause of action, otherwise, the
complaint must succumb to a motion to dismiss on that ground of failure to state a
cause of action. 23 However, where the allegations of the complaint are vague,
indefinite, or in the form of conclusions, the proper recourse would be, not a motion to
dismiss, but a motion for a bill of particulars. 24 Thus, Section 1, Rule 12 of the Rules
of Court provides:
Before responding to a pleading or, if no responsive pleading is permitted by these
rules, within ten (10) days after service of the pleading upon him, a party may move
for a more definite statement or for a bill of particulars of any matter which is not
averred with sufficient definiteness or particularity to enable him properly to prepare
142
his responsive pleading or to prepare for trial. Such motion shall point out the defects
complained of and the details desired.
In this connection, the following allegations have been held as mere conclusions of
law, inferences from facts not alleged or opinion of the pleader: (a) the allegations that
defendants appellees were "actuated by ulterior motives, contrary to law and morals,
with abuse of their advantageous position as employers, in gross and evident bad faith
and without giving plaintiff . . . his due, wilfully, maliciously, unlawfully, and in
summary and arbitrary manner", are conclusions of law, inferences from facts not
alleged and expressions of opinion unsupported by factual premises; 25 (b) an
allegation of duty in terms unaccompanied by a statement of facts showing the
existence of the duty, is a mere conclusion of law, unless there is a relation set forth
from which the law raises the duty; 26 (c) an averment . . . that an act was "unlawful"
or "wrongful" is a mere legal conclusion or opinion of the pleader; 27 (d) the allegation
that there was a violation of trust was plainly a conclusion of law, for "a mere
allegation that it was the duty of a party to do this or that, or that he was guilty of a
breach of duty, is a statement of a conclusion, not of a fact;" 28 (e) an allegation that a
contract is valid or void, is a mere conclusion of law; 29 (f) the averment in the
complaint that "defendant usurped the office of Senator of the Philippines" is a
conclusion of law — not a statement of fact — inasmuch as the particular facts on
which the alleged usurpation is predicated are not set forth therein; 30 and (g) the
averment that "with intent of circumventing the constitutional prohibition that 'no
officer or employee in the civil service shall be removed or suspended except for cause
as provided by law', respondents maliciously and illegally for the purpose of political
persecution and political vengeance, reverted the fund of the salary item . . . and
furthermore eliminated or abolished the said position effective 1 July 1960" is a mere
conclusion of law unsupported by factual premises. 31
Bearing in mind the foregoing rules on pleading and case law, let us now examine the
allegations of the Second Amended Complaint against the petitioner to determine
whether or no they were averred with sufficient definiteness or particularity to enable
him properly to prepare his responsive pleading or to prepare for trial. If the allegations
of the said complaint are vague, indefinite or in the form of conclusions, then petitioner
is entitled to a bill of particulars.
The allegations in the complaint pertaining to the alleged culpable and unlawful acts of
herein petitioner are quoted hereunder as follows:
GENERAL AVERMENTS OF DEFENDANTS' ILLEGAL ACTS
9. (a) From the early years of his presidency, Defendant Ferdinand E. Marcos took
undue advantage of his powers as President. All throughout the period from September
21, 1972 to February 25, 1986, he gravely abused his powers under martial law and
ruled as Dictator under the 1973 Marcos-promulgated Constitution. Defendant
Ferdinand E. Marcos, together with other Defendants, acting singly or collectively,
and/or in unlawful concert with one another, in flagrant breach of public trust and of
their fiduciary obligations as public officers, with gross and scandalous abuse of right
and power and in brazen violation of the Constitution and laws of the Philippines,
embarked upon a systematic plan to accumulate ill-gotten wealth;
(b) Upon his unfettered discretion, and sole authority, for the purpose of implementing
the plan referred to above, Defendant Ferdinand E. Marcos ordered and caused, among
others:
(b-i) the massive and unlawful withdrawal of funds, securities, reserves and other
assets and property from the National Treasury, the Central Bank, the other financial
institutions and depositories of Plaintiff;
(b-ii) the transfer of such funds, securities, reserves and other assets and property to
payees or transferees of his choice and whether and in what manner such transactions
should be recorded in the books and records of these institutions and other depositories
of Plaintiff;
10. Among others, in furtherance of the plan and acting in the manner referred to
above, in unlawful concerted with one another and with gross abuse of power and
authority, Defendants Ferdinand E. Marcos and Imelda R. Marcos;
b. Converted government-owned and controlled corporations into private enterprises
and appropriated them and/or their assets for their own benefit and enrichment;
c. Awarded contracts with the Government to their relatives, business associates,
dummies, nominees, agents or persons who were beholden to said Defendants, under
terms and conditions grossly and manifestly disadvantageous to the Government;
d. Misappropriated, embezzled and/or converted to their own use funds of Government
financial institutions, particularly those allocated to the Office of the President and
other ministries and agencies of the Government including, those conveniently
denominated as intelligence or counter-insurgency funds, as well as funds provided to
Plaintiff by foreign countries, multinationals, public and private financial institutions;
e. Raided Government financial and banking institutions of billions of pesos in loans,
guarantees and other types of finance ial accommodations to finance dubious and/or
overpriced projects of favored corporations or individuals and misused and/or
converted to their own use and benefit deposits found therein to the financial ruin of
Plaintiff and the Filipino people;
h. Sold, conveyed and/or transferred Government property, real and/or personal, to
corporations beneficially held and/ or controlled by them or through third persons,
143
under such terms and conditions grossly and manifestly disadvantageous to the
Government;
i. Engaged in other illegal and improper acts and practices designed to defraud Plaintiff
and the Filipino people, or otherwise misappropriated and converted to their own use,
benefit and enrichment the lawful patrimony and revenues of Plaintiff and the Filipino
people.
11. Among the assets acquired by Defendants in the manner above-described and
discovered by the Commission in the exercise of its official responsibilities are funds
and other property listed in Annex "A" hereof and made an integral part of this
Complaint.
12. Defendants, acting singly or collectively, and/or in unlawful concert with one
another, for the purpose of preventing disclosure and avoiding discovery of their
unmitigated plunder of the National Treasury and of their other illegal acts, and
employing the services of prominent lawyers, accountants, financial experts,
businessmen and other persons, deposited, kept and invested funds, securities and other
assets estimated at billions of US dollars in various banks, financial institutions, trust
or investment companies and with persons here and abroad.
V.SPECIFIC AVERMENTS OF DEFENDANTS' ILLEGAL ACTS
14. Defendants Benjamin (Kokoy) Romualdez and Juliette Gomez Romualdez, acting
by themselves and/or in unlawful concert with Defendants Ferdinand E. Marcos and
Imelda R. Marcos, and taking undue advantage of their relationship, influence and
connection with the latter Defendant spouses, engaged in devices, schemes and
strategems to unjustly enrich themselves at the expense of Plaintiff and the Filipino
people, among others:
(a) obtained, with the active collaboration of Defendants Senen J. Gabaldon, Mario D.
Camacho, Mamerto Nepomuceno, Carlos J. Valdes, Delia Tantuico, Jovencio F.
Cinco, Cesar C. Zalamea and Francisco Tantuico, control of some of the biggest
business enterprises in the Philippines, such as, the Manila Electric Company
(MERALCO), Benguet Consolidated Mining Corporation (BENGUET) and the
Pilipinas Shell Corporation, by employing devious financial schemes and techniques
calculated to require the massive infusion and hemmorrhage of government funds with
minimum or negligible "cashout" from Defendant Benjamin Romualdez. The
following are the general features of a classic take-over bid by Defendant Benjamin
Romualdez:
(ii) The shares were held in the name of corporations which were organized
soldely (sic) for the purpose of holding title to them. These corporations did
not have any operating history nor any financial track record. Projected cash
flow consisted almost solely of future and contingent dividends on the shares
held. In spite of these limitations, these companies enjoyed excellent credit
lines from banks and other financial institutions, as evidenced by the millions
of pesos in loan and guarantees outstanding in their books;
(iii) The "seed money" used to wrest control came from government and
taxpayers' money in the form of millions of pesos in loans, guarantees and
standby L/C's from government financial institutions, notably the DBP and
PNB, which were in turn rediscounted with the Central Bank;
(iv) Additional funding was provided from the related interests; and
(v) This intricate (sic) skein of inter-corporate dealings was controlled and
administered by an exclusive and closely knit group of interlocking
directorate and officership
(g) Secured, in a veiled attempt to justify MERALCO's anomalous acquisition of the
electric cooperatives, with the active collaborations of Defendants Cesar E. A. Virata,
Juanita R. Remulla, Isidro Rodriguez, Jose C. Hernandez, Pedro Dumol, Ricardo C.
Galing, Francisco C. Gatmaitan, Mario D. Camacho and the rest of the Defendants, the
approval by Defendant Ferdinand E. Marcos and his cabinet of the so-called "Three-
Year Program for the Extension of MERALCO's Services to Areas Within The 60-
kilometer Radius of Manila", which required government capital investment
amounting to millions of pesos;
(1) Caused the National Investment and Development Corporation (NIDC) to dispose
of its interest in the oil plants located in Tanauan, Leyte, which were owned and
operated by its subsidiary, the NIDC Oil Mills, Inc., in favor of the SOLO II, Inc., a
corporation beneficially held and controlled by Defendant Benjamin Romualdez, with
the active collaboration of Defendants Jose Sandejas, Francisco Tantuico and
Dominador G. Ingco, under terms and conditions grossly disadvantageous to NIDC, to
the grave and irreparable damage of Plaintiff and the Filipino people.
(2) Defendant Francisco Tantuico, taking undue advantage of his position as Chairman
of the Commission on Audit and with grave failure to perform his constitutional duties
as such Chairman, acting in concert with Defendants Ferdinand E. Marcos and Imelda
R. Marcos, facilitated and made possible the withdrawals, disbursements and
questionable use of government funds as stated in the foregoing paragraphs to the
grave and irreparable damage and injury of Plaintiff and the entire Filipino people.
17. The following Defendants acted as dummies, nominees and/ or agents by allowing
themselves (i) to be used as instruments in accumulating ill-gotten wealth through
144
government concessions, orders and/or policies prejudicial to Plaintiff, or (ii) to be
incorporators, directors, or members of corporations held and/or controlled by
Defendants Ferdinand E. Marcos, Imelda R. Marcos, Benjamin (Kokoy) Romualdez,
and Juliette Gomez Romualdez in order conceal (sic) and prevent recovery of assets
illegally obtained: Francisco Tantuico . . .
17.a. THE NAMES OF SOME OF THE CORPORATIONS BENEFICALLY HELD
AND/OR CONTROLLED BY THE DEFENDANTS BENJAMIN (KOKOY)
ROMUALDEZ, FERDINAND E. MARCOS AND IMELDA R. MARCOS WHERE
THE POSITIONS/PARTICIPATIONS AND/OR INVOLVEMENTS OF SOME OF
THE DEFENDANTS AS DUMMIES, NOMINEES AND/OR AGENTS ARE
INDICATED ARE LISTED IN ANNEX "B" HEREOF AND MADE AN INTEGRAL
PART OF THIS COMPLAINT.
18. The acts of Defendants, singly or collectively, and/or in unlawful concert with one
another, constitute gross abuse of official position and authority, flagrant breach of
public trust and fiduciary obligations, acquisition of unexplained wealth, brazen abuse
of official position and authority, flagrant breach of public trust and fiduciary
obligations, acquisition of unexplained wealth, brazen abuse of right and power, unjust
enrichment, violation of the Constitution and laws of the Republic of the Philippines,
to the grave and irreparable damage of Plaintiff and the Filipino people. (Emphasis
supplied)
Let us now analyze and discuss the allegations of the complaint in relation to which the
petitioner pleads for a bill of particulars.
As quoted above, paragraph 9(a) of the complaint alleges that "Defendant Ferdinand E.
Marcos, together with other Defendants, acting singly or collectively, and/or in
unlawful concert with one another, in flagrant breach of public trust and of their
fiduciary obligations as public officers, with gross and scandalous abuse of right and
power and in brazen violation of the Constitution and laws of the Philippines,
embarked upon a systematic plan to accumulate ill-gotten wealth." In the light of the
rules on pleading and case law cited above, the allegations that defendant Ferdinand E.
Marcos, together with the other defendants "embarked upon a systematic plan to
accumulate ill-gotten wealth" and that said defendants acted "in flagrant breach of
public trust and of their fiduciary obligations as public officers, with gross and
scandalous abuse of right and in brazen violation of the Constitution and laws of the
Philippines", are conclusions of law unsupported by factual premises.
Nothing is said in the complaint about the petitioner's acts in execution of the alleged
"systematic plan to accumulate ill-gotten wealth", or which are supposed to constitute
"flagrant breach of public trust", "gross and scandalous abuse of right and power", and
"violations of the Constitution and laws of the Philippines". The complaint does not
even allege what duties the petitioner failed to perform, or the particular rights he
abused.
Likewise, paragraph 15 avers that "defendant Francisco Tantuico, taking undue
advantage of his position as Chairman of the Commission on Audit and with grave
failure to perform his constitutional duties as such Chairman, acting in concert with
Defendants Ferdinand E. Marcos and Imelda R. Marcos facilitated and made possible
the withdrawals, disbursements and questionable use of government funds as stated in
the foregoing paragraphs to the grave and irreparable damage and injury of Plaintiff
and the entire Filipino people." In like manner, the allegation that petitioner "took
undue advantage of his position as Chairman of the Commission on Audit," that he
"failed to perform his constitutional duties as such Chairman," and acting in concert
with Ferdinand E. Marcos and Imelda R. Marcos, "facilitated and made possible the
withdrawals, disbursements, and questionable use of government funds as stated in the
foregoing paragraphs, to the grave and irreparable damage and injury of plaintiff and
the entire Filipino people", are mere conclusions of law. Nowhere in the complaint is
there any allegation as to how such duty came about, or what petitioner's duties were,
with respect to the alleged withdrawals and disbursements or how petitioner facilitated
the alleged withdrawals, disbursements, or conversion of public funds and properties,
nor an allegation from where the withdrawals and disbursements came from, except for
a general allegation that they came from the national treasury. On top of that, the
complaint does not even contain any factual allegation which would show that
whatever withdrawals, disbursements, or conversions were made, were indeed subject
to audit by the COA.
In this connection, it may well be stated that the Commission on Audit (COA) is an
independent, constitutional commission, which has no power or authority to withdraw,
disburse, or use funds and property pertaining to other government offices or agencies.
This is done by the agency or office itself, the chief or head of which is primarily and
directly responsible for the funds and property pertaining to such office or agency. 32
The COA is merely authorized to audit, examine and settle accounts of the various
government offices or agencies, and this task is performed not by the Chairman of the
COA but by the COA auditors assigned to the government office or agency subject to
COA audit.
Thus, in each agency of the government, there is an auditing unit headed by an auditor,
whose duty is to audit and settle the accounts, funds, financial transactions, and
resources of the agency under his audit jurisdiction. 33 The decision of the auditor is
appealable to the Regional Director, 34 whose decision, is in turn, appealable to the
COA Manager. 35 Any party dissatisfied with the decision of the COA Manager may
bring the matter on appeal to the Commission proper, a collegiate body exercising
quasi-judicial functions, composed of three (3) COA Commissioners, with the COA
145
Chairman as presiding officer. 36 It is only at this stage that the COA Chairman would
come to know of the matter and be called upon to act on the same, and only if an
aggrieved party brings the matter on appeal.
In other words, the Chairman of the COA does not participate or personally audit all
disbursements and withdrawals of government funds, as well as transactions involving
government property. The averments in the particular paragraph of the complaint
merely assume that petitioner participated in or personally audited all disbursements
and withdrawals of government funds, and all transactions involving government
property. Hence, the alleged withdrawals, disbursements and questionable use of
government funds could not have been, as held by respondent Sandiganbayan, "within
the peculiar and intimate knowledge of petitioner as Chairman of the COA."
The complaint further avers in paragraph 17 that "(t)he following Defendants acted as
dummies, nominees and/or agents by allowing themselves (i) to be instruments in
accumulating ill-gotten wealth through government concessions, order and/or policies
prejudicial to Plaintiff, or (ii) to be incorporators, directors, or members of
corporations beneficially held and/or controlled by Defendant Ferdinand E. Marcos,
Imelda R. Marcos, Benjamin (Kokoy) T. Romualdez and Juliette Gomez Romualdez in
order to conceal and prevent recovery of assets illegally obtained: Francisco
Tantuico . . ." 37 Again, the allegation that petitioner acted as dummy, nominee, or
agent by allowing himself "to be used as instrument in accumulating ill-gotten wealth
through government concessions, orders and/or policies prejudicial to Plaintiff" or "to
be (an) incorporator, director, or member of corporations beneficially held and/or
controlled" by the Marcoses and Romualdezes, is a conclusion of law without factual
basis.
The complaint does not contain any allegation as to how petitioner became, or why he
is perceived to be, a dummy, nominee or agent. Besides, there is no averment in the
complaint how petitioner allowed himself to be used as instrument in the accumulation
of ill-gotten wealth, what the concessions, orders and/or policies prejudicial to plaintiff
are, why they are prejudicial, and what petitioner had to do with the granting, issuance,
and or formulation of such concessions, orders, and/or policies. Moreover, Annex "A"
of the complaint lists down sixty-one (61) corporations which are supposed to be
beneficially owned or controlled by the Marcoses and Romualdezes. However, the
complaint does not state which corporations petitioner is supposed to be a stockholder,
director, member, dummy, nominee and/or agent. More significantly, the petitioner's
name does not even appear in Annex "B" of the complaint, which is a listing of the
alleged "Positions and Participations of Some Defendants".
The allegations in the complaint, above-referred to, pertaining to petitioner are,
therefore, deficient in that they merely articulate conclusions of law and presumptions
unsupported by factual premises. Hence, without the particulars prayed for in
petitioner's motion for a bill of particulars, it can be said the petitioner can not
intelligently prepare his responsive pleading and for trial.
Furthermore, the particulars prayed for, such as, names of persons, names of
corporations, dates, amounts involved, specification of property for identification
purposes, the particular transactions involving withdrawals and disbursements, and a
statement of other material facts as would support the conclusions and inferences in the
complaint, are not evidentiary in nature. On the contrary, those particulars are material
facts that should be clearly and definitely averred in the complaint in order that the
defendant may, in fairness, be informed of the claims made against him to the end that
he may be prepared to meet the issues at the trial.
Thus, it has been held that the purpose or object of a bill of particulars is —
. . . to amplify or limit a pleading, specify more minutely and particularly a claim or
defense set up and pleaded in general terms, give information, not contained in the
pleading, to the opposite party and the court as to the precise nature, character, scope,
and extent of the cause of action or defense relied on by the pleader, and apprise the
opposite party of the case which he has to meet, to the end that the proof at the trial
may be limited to the matters specified, and in order that surprise at, and needless
preparation for, the trial may be avoided, and that the opposite party may be aided in
framing his answering pleading and preparing for trial. It has also been stated that it is
the function or purpose of a bill of particulars to define, clarify, particularize, and limit
or circumscribe the issues in the case, to expedite the trial, and assist the court. A
general function or purpose of a bill of particulars is to prevent injustice or do justice in
the case when that cannot be accomplished without the aid of such a bill. 38
Anent the contention of the Solicitor General that the petitioner is not entitled to a bill
of particulars because the ultimate facts constituting the three (3) essential elements of
a cause of action for recovery of ill-gotten wealth have been sufficiently alleged in the
complaint, it would suffice to state that in a motion for a bill of particulars, the only
question to be resolved is whether or not the allegations of the complaint are averred
with sufficient definiteness or particularity to enable the movant properly to prepare his
responsive pleading and to prepare for trial. As already discussed, the allegations of the
complaint pertaining to the herein petitioner are deficient because the averments
therein are mere conclusions of law or presumptions, unsupported by factual premises.
In the light of the foregoing, the respondent Sandiganbayan acted with grave abuse of
discretion amounting to lack or excess of jurisdiction in promulgating the questioned
resolutions.
WHEREFORE, the petition is GRANTED and the resolutions dated 21 April 1989 and
29 May 1989 are hereby ANNULLED and SET ASIDE. The respondents are hereby
146
ordered to PREPARE and FILE a Bill of Particulars containing the facts prayed for by
petitioner within TWENTY (20) DAYS from notice, and should they fail to submit the
said Bill of Particulars, respondent Sandiganbayan is ordered TO EXCLUDE the
herein petitioner as defendant in Civil Case No. 0035.
SO ORDERED.
Note.—The proper office of a bill of particulars is to inform the opposite party and the
court of the precise nature and character of the cause of action. (Tan vs.
Sandiganbayan, 180 SCRA 34.) Tantuico, Jr. vs. Republic, 204 SCRA 428, G.R. No.
89114 December 2, 1991
G.R. No. 94093. August 10, 1993
FAR EAST MARBLE (PHILS.), INC., LUIS R. TABUENA, JR. and RAMON A.
TABUENA, petitioners, vs. HONORABLE COURT OF APPEALS and BANK
OF PHILIPPINE ISLANDS, respondents.
Civil Procedure; Pleadings; Complaint; Sufficiency of cause of action.—Basically, a
cause of action consists of three elements, namely: (1) the legal right of the plaintiff;
(2) the correlative obligation of the defendant; and (3) the act or omission of the
defendant in violation of said legal right (Nabus vs. Court of Appeals, et al., 193
SCRA 732 [1991]); Rebollido vs. Court of Appeals, et al., 170 SCRA 800 [1989]).
These elements are manifest in BPI’s complaint, particularly when it was therein
alleged that: (1) for valuable consideration, BPI granted several loans, evidenced by
promissory notes, and extended credit facilities in the form of trust receipts to Far East
(photocopies of said notes and receipts were duly attached to the Complaint); (2) said
promissory notes and trust receipts had matured; and (3) despite repeated requests and
demands for payment thereof, Far East had failed and refused to pay. Clearly then, the
general allegation of BPI that “despite repeated requests and demands for payment, Far
East has failed to pay” is sufficient to establish BPI’s cause of action.
Same; Same; Same; Same.—A complaint is sufficient if it contains sufficient notice of
the cause of action even though the allegation may be vague or indefinite, for in such
case, the recourse of the defendant would be to file a motion for a bill of particulars
(Ramos vs. Condez, 20 SCRA 1146 [1967]). It is indeed the better rule that, pleadings,
as well as remedial laws, should be liberally construed so that the litigants may have
ample opportunity to prove their respective claims so as to avoid possible denial of
substantial justice due to legal technicalities (Adamao, et al. vs. Intermediate Appellate
Court, et al., 191 SCRA 195 [1990]). Far East Marble (Phils.), Inc. vs. Court of
Appeals, 225 SCRA 249, G.R. No. 94093 August 10, 1993
This has reference to a petition for review by certiorari seeking the reversal of the
decision of the Court of Appeals dated June 26, 1990, in CA-G.R. CV No. 14404
(Bellosillo (P), Marigomen, Sempio-Diy, JJ.) which set aside the order of the Regional
Trial Court of the National Capital Judicial Region (Manila, Branch XIV), dated June
1, 1987 and remanded the case to the court a quo for further proceedings on the
grounds that the complaint for foreclosure of chattel mortgage with replevin had not
prescribed and that, there being a cause of action, further proceedings, including the
resolution of the motion for summary judgment may be pursued.
The antecedent facts of the case may be chronicled as follows:
On February 5, 1987, herein respondent Bank of the Philippines Islands (BPI) filed a
complaint for foreclosure of chattel mortgage with replevin against petitioner Far East
Marble (Phils.), Inc. (Far East), Ramon A. Tabuena and Luis R. Tabuena, Jr. which
was docketed as Civil Case No. 87-39345 of Branch XIV of the Regional Trial Court
of the National Capital Judicial Region stationed in Manila.
The complaint pertinently alleged:
FIRST CAUSE OF ACTION AGAINST FAR EAST
147
2. That on various dates and for valuable consideration, the defendant Far East
received from Commercial Bank and Trust Company . . . now merged with and into
the plaintiff bank . . . several loans evidenced by promissory notes executed by said Far
East, photo copies of which are attached hereto and made integral parts hereof as
Annexes A, B and C.
3. That said promissory notes . . . .have long matured but despite repeated requests and
demands for payment thereof with interests and related charges due, Far East has failed
and refused to pay. The account due on said promissory notes with interests and related
charges as of 10 September 1986 is P4,471,854.32 itemized in a statement of account,
copy of which is attached hereto and made a part hereof as Annex D
4. That because of Far East's failure and refusal in bad faith to pay its long past due
obligations under the promissory notes above alleged, plaintiff was constrained to file
this suit . . .
SECOND CAUSE OF ACTION AGAINST FAR EAST
6. That on various dates and for valuable consideration, the defendant Far East
received from and was extended by . . . plaintiff
Bank . . . credit facilities in the form of Trust Receipts, photo copies of which are
hereto attached and made integral parts hereof as Annexes E, F, G, H, I and J.
7. That said Trust Receipts . . . have long matured and despite repeated requests and
demands for payment thereof with interests and related charges due Far East has failed
and refused to pay. The amount due on said Trust Receipts with interests and related
charges as of 10 September 1986 is P2,170,476.62 as itemized in a statement of
account, copy of which is attached hereto and made an integral part hereof as
Annex K.
8. That because of far East's failure and refusal to pay its long past due obligations
under the Trust Receipts above alleged, plaintiff was constrained to file this suit . . .
xxx xxx xxx
10. That in September 1976 Far East executed in favor of . . . plaintiff Bank . . . a
Chattel Mortgage, photocopy of which is attached hereto and made an integral part
hereof as Annex L, to secure the payment of its loan obligations including interests and
related charges. . .
xxx xxx xxx
CAUSE OF ACTION AGAINST INDIVIDUAL DEFENDANTS RAMON A.
TABUENA AND LUIS R. TABUENA, JR.
13. That in September 1976, defendants Ramon A. Tabuena and Luis R. Tabuena, Jr.
executed in favor of . . . plaintiff Bank . . . a "continuing guaranty" photocopy of which
is attached hereto and made a part hereof as Annex M, whereby they bind
themselves, jointly and severally, to answer for the loan obligations to the Bank of
defendant Far East.
14. That despite requests and demands for their payment of Far East's long past due
accounts, said defendants Ramon A. Tabuena and Luis R. Tabuena, Jr. have failed and
refused to pay said Far East accounts and have already defaulted in their solidary
obligation under said "continuing Guaranty."
15. That because of the failure and refusal of defendants Ramon A. Tabuena and Luis
R. Tabuena, Jr. in bad faith to pay Far East's past due accounts under their solidary
obligation stipulated in said "Continuing Guaranty,". . . plaintiff has been constrained
to file suit against them . . .
(pp. 32-36, Rollo.)
On March 10, 1987, Far East filed an answer with compulsory counterclaim admitting
the genuineness and due execution of the promissory notes attached as Annexes A, B,
and C to the complaint, but alleging further that said notes became due and
demandable on November 19, 1976, respectively. On the basis of the maturity dates of
the notes, Far East thereupon raised the affirmative defenses of prescription and lack of
cause of action as it denied the allegation of the complaint that BPI had made previous
repeated requests and demands for payment. Far East claimed that during the more
than 10 years which elapsed from the dates of maturity of said obligations up to the
time the action for foreclosure of the chattel mortgage securing said obligations was
filed, it had not received from BPI or its predecessor any demand for payment and
thus, it had "labored under the belief that they [the obligations] have already been
written off" in the books of BPI. Moreover, Far East denied the genuineness and due
execution of the trust receipts and of the Statement of Account (pp. 78-79, Rollo). A
motion to hear affirmative defenses was attached to the answer.
On March 16, 1987, BPI filed an opposition to the motion to hear affirmative defenses,
alleging that its cause of action against Far East have not prescribed, since within 10
years from the time its cause of action accrued, various written extrajudicial demands
(attached thereto as Annexes "A" and
"A-1") were sent by BPI and received by Far East. Moreover, BPI offered several
written documents whereby Far East supposedly acknowledged its debt to BPI
(Annexes "B" to "B-6). Withal, BPI maintained, the ten-years prescriptive period to
enforce its written contract had not only been interrupted, but was renewed.
On the same date, BPI filed a motion for summary judgment on the ground that since
Far East had admitted the genuineness and due execution of the promissory notes and
the deed of chattel mortgage annexed to its complaint, there was no genuine issue as to
148
any material fact, thus entitling BPI to a favorable judgment as a matter of law in
regard to its causes of action and on its right to foreclose the chattel mortgage.
On June 1, 1987, the trial court issued an order to the following effect:
WHEREFORE, the Court issues this Order:
1 — Dismissing the complaint against the defendant Far East Marble (Phils.) Inc. for
lack of cause of action and on grounds of pre[s]cription:
2 — Denying for lack of merit the Motion for Summary Judgment and the
Supplemental Motion for Summary Judgment;
3 — Striking off from the records the order of March 6, 1987 and recalling the writ of
replevin issued by this Court, and dismissing all the contempt charges;
4 — Ordering the Sheriff to desist permanently from enforcing the writ of seizure and
to return all the property seized by him under the Writ of Replevin, to the defendant
Far East Marble (Phils.) Inc. immediately from receipt of a copy of this order, and in
case of his failure to do so, the value thereof shall be charged against the replevin
bond. (pp. 89-90, Rollo.)
An appeal therefrom was forthwith interposed by BPI, assailing the findings of the trial
court with respect to its finding that BPI's cause of action has prescribed and the
consequent denial of the motion for summary judgment.
On June 26, 1990, the Court of Appeals rendered a decision setting aside the June 1,
1987 order of the court of origin and remanding the case to said court for further
proceedings, "including the resolution anew of plaintiff's motion for summary
judgment . . ., reception of the evidence of the parties and, thereafter, to decide the case
as the facts may warrant." (pp. 98-99, Rollo.)
Hence, the instant petition for review on certiorari filed by Far East, anchored on the
following assigned errors:
I hand, there is a "question of fact" when the doubt or controversy arises as to the truth
THE COURT OF APPEALS ERRED WHEN IT DISREGARDED THE FINDINGS
OF THE TRIAL COURT THAT PRESCRIPTION HAS SET IN OBLIVIOUS OF
THE FACT THAT THIS FINDING WAS REACHED AFTER DUE HEARING.
II
THE COURT OF APPEALS GRAVELY ERRED IN RULING FOR A REOPENING
OF THE TRIAL FOR THE RECEPTION OF EVIDENCE ON BOTH ISSUES OF
PRESCRIPTION AND SUMMARY JUDGMENT WHEN THESE WERE
ALREADY TRIED AND WEIGHED BY THE TRIAL COURT.
III
THE COURT OF APPEALS ERRED IN ASSUMING JURISDICTION OVER THE
CASE CONSIDERING THAT THE ISSUES RAISED THEREIN INVOLVE PURE
QUESTIONS OF LAW. (p. 14, Rollo.)
The issue of jurisdiction being basis, we shall endeavor to dispose of it ahead of the
other topics raised by petitioners
Petitioner Far East maintains the position that the Court of Appeals stepped beyond the
limits of its authority when it assumed jurisdiction over the appeal filed by BPI
inasmuch as said appeal raised only the pure questions of law or whether or not the
trial court erred: (1) in dismissing BPI's complaint for lack of cause of action; (2) in
finding that BPI's cause of action had prescribed; and (3) in ruling that BPI is not
entitled to summary judgment on its causes of action against Far East. Consequently,
Far East contends, BPI should have taken its case directly to this Court.
There is no dispute with respect to the fact that when an appeal raises only pure
questions of law, it is only this Court which has jurisdiction to entertain the same
(Article VIII, Section 5 (2) (e), 1987 Constitution; Rule 45, Rules of Court; see also
Santos, Jr. vs. Court of Appeals, 152 SCRA 378 [1987]). On the other hand, appeals
involving both questions of law and fact fall within the exclusive appellate jurisdiction
of the Court of Appeals. At this point, there seems to be a need to distinguish a
question of law from a question of fact.
It has been held in a number of cases (Medina vs. Asistio, Jr., 191 SCRA 218 [1990];
Gan vs. Licup Design Group, Inc., G.R. NO. 94264, July 24, 1990, En Banc, Minute
Resolution; Pilar Development Corp. vs. Intermediate Appellate Court, et al., 146
SCRA 215 [1986]; Ramos vs. Pepsi-Cola Bottling Co., 19 SCRA 289 [1967];
Consolidated Mines, Inc. vs. Court of Tax Appeals, et al., 58 SCRA 618 [1974]), that
there is a "question of law" when there is doubt or difference of opinion as to what the
law is on certain state of facts and which does not call for an examination of
the probative value of the evidence presented by the parties-litigants. On the other
or falsity of the alleged facts. Simply put, when there is no dispute as to fact, the
question of whether or not the conclusion drawn therefrom is correct is a question of
law.
In the case at bar, BPI alleged in its complaint (Rollo, p. 42) that on various dates and
for valuable consideration, it extended to Far East several loans, evidenced by
promissory notes, and credit facilities in the form of trust receipts, and that despite
repeated requests and demands for payment thereof, Far East had failed and refused to
pay. Thus BPI sought foreclosure of the chattel mortgage securing such indebtedness.
149
In its answer (Rollo, p. 78), Far East admitted the genuineness and due execution of the
promissory notes involved in the case, but denied BPI's allegation that repeated
demands for payment were made by BPI on it. Far East then raised the affirmative
defenses of prescription and lack of cause of action, arguing that since the promissory
notes matured in 1976 while BPI filed its action to foreclose the chattel mortgage only
in 1987 (or more than 10 years from the time its cause of action accrued), and there
being no demand for payment which would interrupt the period of prescription for
instituting said action, BPI's claims have prescribed.
BPI, however, countered that its allegation of repeated demands on Far East for
payment sufficiently stated a cause of action; that within ten years from the time its
cause of action accrued in 1976, it sent written extrajudicial demands on Far East
requesting payment of its due and outstanding obligations; that within that 10-years
period, it received written acknowledgments of debt from Far East; and, that these
demands for payment and acknowledgments of debt effectively interrupted and
renewed the prescriptive period. Worth noting is the fact that the acknowledgment of
debt and the demands for payment, including the affidavits of BPI's counsel who
prepared the demand letter and that of BPI's messenger who allegedly personally
delivered said letters to Far East were duly annexed to BPI's pleadings.
From the foregoing exchange of pleading, the conflicting allegations of fact by the
contending parties sprung forth. It is thus quite obvious that the controversy centered
on, and the doubt arose with respect to, the very existence of previous demands for
payment allegedly made by BPI on petitioner Far East, receipt of which was denied by
the latter. This dispute or controversy inevitably raised a question of fact. Such being
the case, the appeal taken by BPI to the Court of Appeals was proper.
We now come to petitioner's first two assigned errors.
The trial court's finding that BPI's claims due to prescription, can no longer prosper, is
inextricably connected with, and underpinned by, its other conclusion that BPI's
allegation that it made "repeated requests and demands for payment" is not sufficient
to state a cause of action. Moreover, in its questioned Order (Rollo, p. 88) dated June 1,
1987, the trial court held that:
Apart from the fact that the complaint failed to allege that the period of prescription
was interrupted, the phrase "repeated requests and demands for payment" is vague and
incomplete as to establish in the minds of the defendant, or to enable the Court to draw
a conclusion, that demands or acknowledgment [of debt] were made that could have
interrupted the period of prescription. (p. 88, Rollo.).
Seemingly, therefore, the trial court believed that the interruption of the prescriptive
period to institute an action is an ULTIMATE FACT which had to be expressly and
indispensably pleaded by BPI in its complaint, and that failure to so alleged such
circumstance is fatal to BPI's cause of action.
We believe and hold otherwise.
Section 3 of Rule 6 state that a "complaint is a concise statement of the ultimate facts
constituting the plaintiff's cause or causes of action." Further elaborating thereon,
Section 1 of Rule 8 declares that every pleading, including, of course, a complaint,
"shall contain in a methodical and logical form, a plain, concise and direct statement of
the ultimate facts . . . omitting the statement of mere evidentiary facts." "Ultimate
facts" are the essential and substantial facts which either form the basis of the primary
right and duty or which directly make up the wrongful acts or omissions of the
defendant (Tantuico, Jr. vs. Republic of the Phil., et al., 204 SCRA 428 [1991]), while
"evidentiary facts" are those which tend to prove or establish said ultimate facts.
What then are the ultimate facts which BPI had to allege in its complaint so as to
sufficiently establish its cause of action?
Basically, a cause of action consists of three elements, namely: (1) the legal right of the
plaintiff; (2) the correlative obligation of the defendant; and (3) the act or omission of
the defendant in violation of said legal right (Nabus vs. Court of Appeals, et al., 193
SCRA 732 [1991]); Rebollido vs. Court of Appeals et al., 170 SCRA 800 [1989]).
These elements are manifest in BPI's complaint, particularly when it was therein
alleged that: (1) for valuable consideration, BPI granted several loans, evidenced by
promissory notes, and extended credit facilities in the form of trust receipts to Far East
(photocopies of said notes and receipts were duly attached to the Complaint); (2) said
promissory notes and trust receipts had matured; and (3) despite repeated requests and
demands for payment thereof, Far East had failed and refused to pay.
Clearly then, the general allegation of BPI that "despite repeated requests and demands
for payment, Far East has failed to pay" is sufficient to establish BPI's cause of action.
Besides, prescription is not a cause of action; it is a defense which, having been
raised, should, as correctly ruled by the Court of Appeals (DBP vs. Ozarraga, 15
SCRA 48 [1965]), be supported by competent evidence. But even as Far East raised
the defense of prescription, BPI countered to the effect that the prescriptive period was
interrupted and renewed by written extrajudicial demands for payment and
acknowledgment by Far East of the debt.
A complaint is sufficient if it contains sufficient notice of the cause of action even
though the allegation may be vague or indefinite, for in such case, the recourse of the
defendant would be to file a motion for a bill of particulars (Ramos vs. Condez, 20
SCRA 1146 [1967]). It is indeed the better rule that, pleadings, as well as remedial
150
laws, should be liberally construed so that the litigants may have ample opportunity to
prove their respective claims so as to avoid possible denial of substantial justice due to
legal technicalities (Adamo, et al. vs. Intermediate Appellate Court, et al., 191 SCRA
195 [1990]).
In the case at bar, the circumstances of BPI extending loans and credits to Far East and
the failure of the latter to pay and discharge the same upon maturity are the only
ultimate facts which have to be pleaded, although the facts necessary to make the
mortgage valid enforceable must be proven during the trial (Ortiz v. Garcia, 15 Phil.
192 [1910]).
In fine, the finding of the trial court that prescription has set in is primarily premised
on a misappreciation of the sufficiency of BPI's allegation as above discussed. The
records will show that the hearing conducted by the trial court was merely pro
forma and the trial judge did not sufficiently address the issue of whether or not a
demand for payment in fact made by BPI and duly received by herein petitioner Far
East.
WHEREFORE, the instant petition is hereby DENIED and the decision of the Court of
Appeals hereby AFFIRMED. No special pronouncement is made as to costs.
SO ORDERED.
Note.—In a motion to dismiss based on the failure of the complaint to state a cause of
action, the question submitted for determination is sufficiency of allegation in the
complaint itself (Calalang v. Intermediate Appellate Court, 194 SCRA 514). Far East
Marble (Phils.), Inc. vs. Court of Appeals, 225 SCRA 249, G.R. No. 94093 August 10,
1993
G.R. No. 106429. June 13, 1994.
JOSELITA SALITA, petitioner, vs. HON. DELILAH MAGTOLIS, in her
capacity as Judge of the RTC, Quezon City, Br. 107, and ERWIN ESPINOSA,
respondents.
Actions; Pleadings and Practice; Words and Phrases; Ultimate Facts, defined; A
complaint only needs to state the ultimate facts constituting the plaintiff’s cause or
causes of action.—A complaint only needs to state the “ultimate facts constituting the
plaintiff’s cause or causes of action.” Ultimate facts has been defined as “those facts
which the expected evidence will support.” As stated by private respondent, “[t]he
term does not refer to the details of probative matter or particulars of evidence by
which these material elements are to be established.” It refers to “the facts which the
evidence on the trial will prove, and not the evidence which will be required to prove
the existence of those facts.”
Same; Same; Bill of Particulars; A motion for bill of particulars may not call for
matters which should form part of the proof of the complaint upon trial.—And a
motion for bill of particulars will not be granted if the complaint, while not very
definite, nonetheless already states a sufficient cause of action. A motion for bill of
particulars may not call for matters which should form part of the proof of the
complaint upon trial. Such information may be obtained by other means.
Same; Same; Same; To obtain evidentiary matters is not the function of a motion for
bill of particulars.—Private respondent has already alleged that “she (petitioner) was
unable to understand and accept the demands made by his profession x x x upon his
time and efforts x x x x” Certainly, she can respond to this. To demand for more details
would indeed be asking for information on evidentiary facts—facts necessary to prove
essential or ultimate facts. For sure, the additional facts called for by petitioner
regarding her particular acts or omissions would be evidentiary, and to obtain
evidentiary matters is not the function of a motion for bill of particulars.
Same; Same; Same; Present case distinguished from Tantuico, Jr. v. Republic; It would
be unreasonable, if not unfeeling, to document each and every circumstance of marital
disagreement. We distinguish the instant case from Tantuico, Jr. v. Republic, 204
SCRA 428.—That ruling involves alleged “misappropriation and theft of public funds,
plunder of the nation’s wealth, extortion, blackmail, bribery, embezzlement, and other
acts of corruption, betrayal of public trust and brazen abuse of power.” The
respondents therein pray for reconveyance, reversion, accounting, restitution and
damages. There, the alleged illicit acts should be fully documented. The instant case,
on the other hand, concerns marital relationship. It would be unreasonable, if not
unfeeling, to document each and every circumstance of marital disagreement. True, the
complaining spouse will have to prove his case, but that will not come until trial
begins.
151
Erwin Espinosa, 32, and Joselita Salita, 22, were married at the Roman Catholic
Church in Ermita, Manila, on 25 January 1986. A year later, their union turned sour.
They separated in fact in 1988. Subsequently, Erwin sued for annulment on the ground
of Joselita’s psychological incapacity.
The issue before us however is not the scope nor even the interpretation of Art. 36 of
the Family Code. 1 Rather, the issue is the sufficiency of the allegations in the petition
for annulment of marriage and the subsequent bill of particulars filed in amplification
of the petition.
The petition for annulment was filed before the Regional Trial Court of Quezon City
on 7 January 1992. Therein it is alleged that "[s]ometime in 1987, petitioner came to
realize that respondent was psychologically incapacitated to comply with the essential
marital obligations of their marriage, which incapacity existed at the time of the
marriage although the same became manifest only thereafter." 2 Dissatisfied with the
allegation in the petition, Joselita moved for a bill of particulars which the trial court
granted. 3 Subsequently, in his Bill of Particulars, Edwin specified that —
. . . at the time of their marriage, respondent (Joselita Salita) was psychologically
incapacitated to comply with the essential marital obligations of their marriage in that
she was unable to understand and accept the demands made by his profession — that
of a newly qualified Doctor of Medicine — upon petitioner’s time and efforts so that
she frequently complained of his lack of attention to her even to her mother, whose
intervention caused petitioner to lose his job.
Still Joselita was not contented with the Bill of Particulars. She argued that the
"assertion (in the Bill of Particulars) is a statement of legal conclusion made by
petitioner’s counsel and not an averment of ‘ultimate facts,’ as required by the Rules of
Court, from which such a conclusion may properly be inferred . . . ." 4 But finding the
questioned Bill of Particulars adequate, the trial court issued an order upholding its
sufficiency and directing Joselita to file her responsive pleading.
Joselita was not convinced. She filed a petition for certiorari with us. However, we
referred her petition to the Court of Appeals for resolution.
On 21 July 1992, the Court of Appeals denied due course to her petition thus —
In the case under consideration, Espinosa has amplified Salita’s alleged psychological
incapacity in his bill of particulars . . .
In our view, the aforesaid specification more than satisfies the Rules’ requirement that
a complaint must allege the ultimate facts constituting a plaintiff’s cause of action. To
require more details thereof, to insist on a specification of Salita’s particular conduct or
behavior with the corresponding ‘circumstances of time, place and person’ indicating
her alleged psychological incapacity would be to ask for information on evidentiary
matters. To obtain evidentiary details, Salita may avail herself of the different modes
of discovery provided by the Rules of Court
(Rules 24 to 28).
Whether Espinosa’s averments in his bill of particulars constitute psychological
incapacity in the contemplation of the Family Code is a question that may be resolved
in a motion to dismiss or after trial on the merits of the case, not in a motion for bill of
particulars. And certainly, that matter cannot be resolved in the present petition. 5
Hence, the instant petition for review on certiorari filed by Joselita Salita questioning
the Resolution of the Court of Appeals denying due course to her petition.
Petitioner insists that the allegations in the Bill of Particulars constitute a legal
conclusion, not an averment of facts, and fail to point out the specific essential marital
obligations she allegedly was not able to perform, and thus render the Bill of
Particulars insufficient if not irrelevant to her husband’s cause of action. She
rationalizes that her insistence on the specification of her particular conduct or
behavior with the corresponding circumstances of time, place and person does not call
for information on evidentiary matters because without these details she cannot
adequately and intelligently prepare her answer to the petition.
Private respondent on the other hand believes that his allegations in the Bill of
Particulars constitute the ultimate facts which the Rules of Court requires at this point.
He defines ultimate facts as —
. . . important and substantial facts which either directly form the basis of the primary
right and duty, or which directly make upon the wrongful acts or omissions of the
defendant. The term does not refer to the details of probative matter or particulars of
evidence by which these material elements are to be established. It refers to principal,
determinate facts upon the existence of which the entire cause of action rests. 6
Ultimate facts are conclusions drawn from intermediate and evidentiary facts, or
allegations of mixed law and fact; they are conclusions from reflection and natural
reasoning on evidentiary fact. The ultimate facts which are to be pleaded are the
issuable, constitutive, or traversible facts essential to the statement of the cause of
action; the facts which the evidence on the trial will prove, and not the evidence which
will be required to prove the existence of those facts . . . 7
Private respondent further argues that "[c]onclusions of law and evidentiary matters
need not be stated in the complaint. The rules of pleading limit the statement of the
cause of action only to such operative facts as would give rise to the right of action of
the plaintiff to obtain relief against the wrongdoer. The details of probative matter or
particulars of evidence, statements of law, inferences and arguments need not be
stated." 8
152
In a nutshell, the ultimate question is whether the Bill of Particulars submitted by
herein respondent is of sufficient definiteness or particularity as to enable herein
petitioner to properly prepare her responsive pleading or for trial.
A complaint only needs to state the "ultimate facts constituting the plaintiff’s cause or
causes of action." 9 Ultimate facts has been defined as "those facts which the expected
evidence will support." 10 As stated by private respondent, "[t]he term does not refer to
the details of probative matter or particulars of evidence by which these material
elements are to be established." It refers to "the facts which the evidence on the trial
will prove, and not the evidence which will be required to prove the existence of those
facts." And a motion for bill of particulars will not be granted if the complaint, while
not very definite, nonetheless already states a sufficient cause of action. 11 A motion for
bill of particulars may not call for matters which should form part of the proof of the
complaint upon trial. Such information may be obtained by other means. 12
We sustain the view of respondent Court of Appeals that the Bill of Particulars filed by
private respondent is sufficient to state a cause of action, and to require more details
from private respondent would be to ask for information on evidentiary matters.
Indeed, petitioner has already been adequately apprised of private respondent’s cause
of action against her thus —
. . . . (she) was psychologically incapacitated to comply with the essential marital
obligations of their marriage in that she was unable to understand and accept the
demands made by his profession — that of a newly qualified Doctor of Medicine —
upon petitioner’s time and efforts so that she frequently complained of his lack of
attention to her even to her mother, whose intervention caused petitioner to lose his
job.
On the basis of the aforequoted allegations, it is evident that petitioner can already
prepare her responsive pleading or for trial. Private respondent has already alleged that
"she (petitioner) was unable to understand and accept the demands made by his
profession . . . upon his time and efforts . . . " Certainly, she can respond to this. To
demand for more details would indeed be asking for information on evidentiary facts
— facts necessary to prove essential or ultimate facts. 13 For sure, the additional facts
called for by petitioner regarding her particular acts or omissions would be evidentiary,
and to obtain evidentiary matters is not the function of a motion for bill of
particulars. 14
We distinguish the instant case from Tantuico, Jr. v. Republic 15 where we said —
Furthermore, the particulars prayed for such as names of persons, names of
corporations, dates, amounts involved, a specification of property for identification
purposes, the particular transactions involving withdrawals and disbursements, and a
statement of other material facts as would support the conclusions and inferences in the
complaint, are not evidentiary in nature. On the contrary, those particulars are material
facts that should be clearly and definitely averred in the complaint in order that the
defendant may, in fairness, be informed of the claims made against him to the end that
he may be prepared to meet the issues at the trial.
The aforementioned pronouncement cannot apply to the instant case. That ruling
involves alleged "misappropriation and theft of public funds, plunder of the nation’s
wealth, extortion, blackmail, bribery, embezzlement, and other acts of corruption,
betrayal of public trust and brazen abuse of power." The respondents therein pray for
reconveyance, reversion, accounting, restitution and damages. There, the alleged illicit
acts should be fully documented. The instant case, on the other hand, concerns marital
relationship. It would be unreasonable, if not unfeeling, to document each and every
circumstance of marital disagreement. True, the complaining spouse will have to prove
his case, but that will not come until trial begins.
Consequently, we have no other recourse but to order the immediate resumption of the
annulment proceeding which have already been delayed for more than two years now,
even before it could reach its trial stage. Whether petitioner is psychologically
incapacitated should be immediately determined. There is no point in unreasonably
delaying the resolution of the petition and prolonging the agony of the wedded couple
who after coming out from a storm still have the right to a renewed blissful life either
alone or in the company of each other.
A word on Art. 36 of the Family Code. 16 We do not see the need to define or limit the
scope of the provision. Not in this case, at least. For, we are not called upon to do so,
the actual controversy being the sufficiency of the bill of particulars. To interpret the
provision at this juncture would be to give an obiter dictum which is ill-timed. Besides,
it appears that petitioner in her memorandum has demonstrated a good grasp of what
Art. 36 actually covers. Suffice it to say that Mme. Justice Sempio-Diy, formerly of the
Court of Appeals and a member of the Civil Code Revision Committee that drafted the
Family code, explains —
The Committee did not give any examples of psychological incapacity for fear that the
giving of examples would limit the applicability of the provision under the principle
of ejusdem generis. Rather, the Committee would like the judge to interpret the
provision on a case-to-case basis, guided by experience, the findings of experts and
researchers in psychological disciplines, and by decisions of church tribunals which,
although not binding on the civil courts, may be given persuasive effect since the
provision was taken from Canon Law. 17
WHEREFORE, there being no reversible error, the instant petition is DENIED and the
questioned Resolution of respondent Court of Appeals dated 21 July 1992 is
AFFIRMED.
153
SO ORDERED.
Note.—Abandonment implies a departure by one spouse with the avowed intent never
to return, followed by prolonged absence without just cause, and without in the
meantime providing in the least for one’s family although able to do so (Partosa-Jo vs.
Court of Appeals, 216 SCRA 692 [1992]).
GR No. L-38544. July 30, 1982
LUZ E. BALITAAN, petitioner, vs. COURT OF FIRST INSTANCE OF
BATANGAS, BRANCH II, and RITA DE LOS REYES, respondents.
Criminal Procedure; Every element of an offense must be alleged in the information.—
It is fundamental that every element of which the offense is composed must be alleged
in the complaint or information. What facts and circumstances are necessary to be
stated must be determined by reference to the definitions and the essentials of the
specific crimes.
Same; Same; Case at bar.—Thus, in the case at bar, inasmuch as the crime of estafa
through misappropriation or with grave abuse of confidence is charged, the
information must contain these elements: (a) that personal property is received in trust,
on commission, for administration or under any other circumstance involving the duty
to make delivery of or to return the same, even though the obligation is guaranteed by
a bond; (b) that there is conversion or diversion of such property by the person who
has so received it; (c) that such conversion, diversion or denial is to the injury of
another and (d) that there be demand for the return of the property.
Same; Purpose of requirement.—The main purpose of requiring the various elements
of a crime to be set out in an information is to enable the accused to suitably prepare
his defense. He is presumed to have no independent knowledge of the facts that
constitute the offense.
Same; Evidence; It is often difficult to say what is a matter of evidence and what facts
form the elements of an offense.—However, it is often difficult to say what is a matter
of evidence, as distinguished from facts necessary to be stated in order to render the
information sufficiently certain to identify the offense. As a general rule, matters of
evidence, as distinguished from facts essential to the description of the offense, need
not be averred. For instance, it is not necessary to show on the face of an information
for forgery in what manner a person is to be defrauded, as that is a matter of evidence
of the trial.
Same; In alleging elements of an offense, reasonable certainty only is required.—
Moreover, reasonable certainty in the statement of the crime suffices. All that is
required is that the charge be set forth with such particularity as will reasonably
indicate the exact offense which the accused is alleged to have committed and will
enable him intelligently to prepare his defense, and if found guilty to plead her
conviction, in a subsequent prosecution for the same offense.
Same; Where information for estafa alleged that accused misappropriated P127.58,
introduction of evidence that accused received three checks amounting to P1,632.97
which was not alleged in the information, is not improper.—Applying these principles,
We rule that the existence of the three checks need not be alleged in the Information.
This is an evidentiary matter which is not required to be alleged therein. Further, that
these checks, as testified by petitioner amounted to P1,632.97 did not vary the
allegation in the Information that respondent Rita de los Reyes misappropriated the
amount of P127.58. Proof of the checks and their total amount was material evidence
of the fact that respondent misappropriated the amount of P127.58 which was but a
part of the total sum of the checks.
Same; Criminal Law; In estafa under Article 315, par. 1(b) which is committed with
abuse of confidence previous demand is necessary; whereas, in par. 2(a) no demand is
necessary.—It is true that estafa under paragraph 1(b) is essentially a different offense
from estafa under paragraph 2(a) of the same article because the elements of these two
offenses are not the same. In estafa under paragraph 1(b), which is committed with
grave abuse of confidence, it must be shown that the offender received money or other
personalty in trust or on commission or for administration, or under any other
obligation involving the duty to make delivery of or to return the same but
misappropriated it to the prejudice of another. It is also necessary that previous demand
be made on the offender. To sustain a conviction for estafa under paragraph 2(a), on
the other hand, deceit or false representation to defraud and the damage caused thereby
must be proved. And no demand is necessary.
Same; Evidence; In a prosecution for estafa under par. 1(b) of Article 315, Revised
Penal Code, proof of deceit is allowed and even if deceit is present, abuse of
confidence will characterize the estafa.—This does not mean, however, that
presentation of proof of deceit in a prosecution for estafa under paragraph 1(b) is not
allowed. Abuse of confidence and deceit may co-exist. Even if deceit may be present,
the abuse of confidence will characterize the estafa as the deceit will be merely
incidental or as the Supreme Court of Spain held, is absorbed by abuse of confidence.
Same; Same; Estafa by abuse of confidence is committed even if deceit was employed
to evidence the creation of the relationship of trust and confidence.—It has also been
held that as long as there is a relation of trust and confidence between the complainant
154
and the accused and even though such relationship has been induced by the accused
thru false representations and pretense and which is continued by active deceit without
truthfully disclosing the facts to the complainant, the estafa committed is by abuse of
confidence although deceit co-exists in its commission.
Same; Same; Same; Case at Bar.—Thus, the questioned testimony eliciting the fact
that accused respondent falsely represented to the complainant-petitioner that the
amount of P127.58 out of the total of P1,632.97 belonged to Cesar Dalangin may not
be said to be at variance with the allegations of the Information. The presence of deceit
would not change the whole theory of the prosecution that estafa with abuse of
confidence was committed. Besides, in estafa by means of deceit, it is essential that the
false statement or fraudulent representation constitutes the very cause or the only
motive which induces the complainant to part with the thing. The municipal court
property denied, therefore, the motion to strike out the testimonies anent use of false
representations. Balitaan vs. Court of First Instance of Batangas, 115 SCRA 729, No.
L-38544 July 30, 1982
Contrary to law. 1
At the initial hearing on September 18, 1973, complaining witness Luz E. Balitaan,
herein petitioner, was called as the prosecution's first witness. She testified that she
was the proprietress of a baby dress mending shop, that her business was engaged in
the sewing of baby dresses with the accused, Rita de los Reyes, herein respondent, as
the one in charge of the management of her business, including the procurement of
unsewed baby dresses from, and the delivery of finished dresses to Unaware, Inc. She
further testified as follows:
Q. Sometime in April 27,1972, do you know if the accused in this case, Rita de los
Reyes had made deliveries of baby dresses to Uniware, Incorporated?
A. Yes, sir.
Q. Do you have a receipt or cash voucher to show that those baby dresses were
delivered?

This is a petition for review on certiorari of the decision of the Court of First Instance A. Yes, sir.
of Batangas in Civil Case No. 81 entitled "Rita de los Reyes vs. Luz E. Balitaan, et al."
Q. I am going to show you a cash voucher dated April 27, 1972, which appears to be
which annulled the orders of the Judge of the Municipal Court of Bauan, Batangas and
the original carbon copy and which for purposes of Identification we ask that the same
ordered the questioned testimonies to be striken out from the record on the ground that
be marked as Exhibit "A" for the prosecution.
they are at variance with the allegations of the Information.
COURT:
The chronological sequence of the events leading to the filing of the instant petition is
as follows: Mark it.
On April 11, 1973, Special Counsel Arcadio M. Aguila filed with the Municipal Court Atty. Enriquez:
of Bauan, Batangas, an Information charging respondent Rita de los Reyes of the crime
of estafa. The Information reads as follows: Q. Is this the cash voucher of baby dresses delivered by Rita de los Reyes?

That in, about and during the period comprised between April 27, 1982 to June, 1972, xxx xxx xxx
inclusive, in the Municipality of Bauan, Batangas, Philippines, and within the A. Yes, sir.
jurisdiction of this Honorable Court, the abovenamed accused, being then an employee
of one Luz E. Balitaan, owner of a baby dresses mending shop in Barrio Aplaya of the Q. Do you know this or what is this about?
said municipality and having collected and received from Uniware, Inc., a business
establishment in Makati, Rizal, to which finished baby dresses are turned over after A. This is receipt of payment made to us for the dresses we have made.
they have been mended and made, the sum of P127.58 in payment of work done on xxx xxx xxx
baby dresses by said Luz E. Balitaan, and under the express obligation on the part of
the accused to immediately account for and deliver the said amount of P127.58 to said Q. It appears in this voucher, Exhibit "A", that the total payment made and suppose to
Luz E. Balitaan, with unfaithfulness and grave abuse of confidence and in spite of be received was in the amount of P1,632.27 in words and figures, how was the
repeated demands made to the said accused to turn over the said amount of P127.58, payment made?
did then and there, wilfully, unlawfully and feloniously misappropriate, misapply and
A. By checks sir.
convert the sum of P127.58 to her (accused) own use and benefit, to the damage and
prejudice of the said Luz E. Balitaan in the aforementioned amount of P127.58. Q. How many checks?
155
A. Three (3) checks, sir.
Q. Would you know from this Exhibit "A" the number of checks and the
corresponding amount appearing in the checks in payment of this P1,632.97?
(Witness again shown Exhibit "A").
A. Yes sir.
Q. Where, will you point to this Exhibit "A"?
A. Witnesses pointing to #17000703 and opposite it the amount of P500.00; she was
also pointing to #17000702 and opposite it P500.00; and also #17000704, opposite it is
the amount of P632.97.
Q. Now, who received the checks in payment of the dresses made in this cash voucher?
A. Rita de los Reyes, sir. (herein respondent)
Q. From where?
A. In Makati.
Q. This cash voucher dated April 27, 1972, Exhibit "A", who received this from
Unaware, Incorporated, if it was received? 2
At this juncture, counsel for the accused Rita de los Reyes objected to the testimony of
complaining witness, Luz E. Balitaan and presented two motions. The transcript of
stenographic notes shows what these motions are:
ATTY. CONTRERAS:
If your Honor please, the defense is respectfully presenting to this Honorable Court
two (2) motions: first, to strike out all the testimonies of the witness as far as Exhibit
"A" is concerned on the ground that said testimonies are at variance with the
allegations in the information, there is no allegation in the information whatsoever
regarding these checks and this cash voucher, your Honor, and we are filing a motion
in the nature of an objection to any other question or questions regarding these checks
that were allegedly received by the herein accused from the Unaware Incorporated
because there is no allegation in the information. If the information will only be read
carefully, the sum of P127.58 in payment of work done in baby dresses was received
by the accused, so that all these evidence, having received checks in so much
amount ... It is respectfully submitted by the defense that no evidence could be
admissible under the rules.
ATTY. ENRIQUEZ:
There was already testimony of this witness that there is certain amount received and
that portion thereof was not delivered to the offended party. What we are proving here
are preliminary evidence going directly to the present issue of P127.58 was received,
as the Court would readily see in this cash voucher that the amount subject matter of
the information or complaint is indicated in this cash voucher. This exhibit and
evidence is germane and I want to show that there is misappropriation of the amount
from the total amount of P1,632.97.
ATTY. CONTRERAS:
The information alleges that the accused received the sum of P127.58, the information
does not cite that this amount was only a part of the cash received. All these evidence
will be immaterial, there is no allegation in the information by which this information
would be tending to sustain. I submit, your Honor.
ATTY. ENRIQUEZ:
We submit, your Honor.
COURT:
Objection overruled. 3
As clearly seen above, the objection was overruled. Luz E. Balitaan thereby continued
with her testimony and declared that accused Rita de los Reyes delivered the said
checks and voucher to her; that upon delivery, the said accused represented to her that
the baby dresses with style Nos. 648, 151, 161 and 203 were those of Cesar Dalangin
whose payment in the amount of P127.58 was included in the checks; that in view of
this statement, said Luz E. Balitaan instructed said accused to cash the checks in order
to pay Cesar Dalangin; that Rita de los Reyes returned the following day with the cash
minus the amount of P127.58. She further declared that two or three weeks afterwards,
she noticed that there were too many baby dresses that were lost prompting her to
verify the receipts of payment, one of which is the cash voucher, Exhibit "A". In the
course of her investigation, she went to see Cesar Dalangin who declared that Style
Nos. 648, 151, 161 and 203 were not his and denied having received any amount from
Rita de los Reyes or of even knowing the latter; that when she confronted the accused
and asked why she deceived her, said accused could not talk, turned pale but later
admitted having kept the amount.
At the close of the direct examination of Luz E. Balitaan, counsel for the accused
moved to strike out the foregoing testimonies but respondent court also denied the
motion.
Consequently, accused Rita de los Reyes instituted in the Court of First Instance of
Batangas, Eighth Judicial District, Branch II, Civil Case No. 81, against petitioner-
appellant, Luz E. Balitaan, and the Honorable Guillermo B. Magnaye, in his capacity
156
as Judge of the Municipal Court of Bauan, Batangas, a petition for certiorari, with
preliminary injunction, to annul the aforementioned orders of the said Municipal Court
of Bauan, Batangas, overruling the objections of accused Rita de los Reyes to the
testimony of complaining witness on the grounds of immateriality and variance with
the Information as well as denying the motion to strike out the same.
In a decision dated March 13, 1973, the Court of First Instance of Batangas sustained
respondent's stand and hence, granted the petition for writ of certiorari, the dispositive
portion of the same states as follows:
WHEREFORE, the petition is granted and the orders of respondent Judge overruling
petitioner's objection, as well as denying her motion to strike out the testimonies of
Luz E. Balitaan abovequoted and appearing on pages 23-32 of the transcript of
stenographic notes marked Exhibit "X", are hereby annulled. Let said testimonies be
stricken out from the record of the hearing of September 18, 1973, of Criminal Case
No. 2172 of the Municipal Court of Bauan, Batangas entitled People vs. Rita de los
Reyes. Costs against private respondent Luz E. Balitaan.
SO ORDERED. 4
From said decision, Luz E. Balitaan filed this instant petition for review with the
following assigned errors:
I. The lower court erred in granting the writ of certiorari to annul the orders of the
Municipal Court of Bauan, Batangas in Criminal Case No. 2172.
II. The lower court erred in holding that there is a variance between the allegation in
the information for estafa in Criminal Case No. 2172 and the proof established by the
petitioner's testimony thereat.
III. The lower court, in resolving the present case, erred when it decided the merits of
Criminal Case No. 2172 instead of limiting itself to a determination of whether the writ
of certiorari should issue or not. 5
In resolving the issue of variance between allegation and proof, the Court of First
Instance ruled:
Private respondent contends that Luz E. Balitaan's testimonies about the delivery of the
checks to petitioner and their having been cashed by her is merely to show the source
of the P127.58 misappropriated. True but when she testified that petitioner deducted
the said amount from the proceeds falsely representing that the same belonged to Cesar
Dalangin, and should be delivered to him, when in fact she did not deliver but
misappropriated the same to her own use and benefit, the testimony became
objectionable. It became objectionable because it tended to prove estafa committed not
in the manner as alleged in the information but in a manner not alleged therein. In
overruling petitioner's objection, respondent Judge acted in excess of his jurisdiction
because the Rules expressly provides (sic) that evidence should correspond with the
allegations of the complaint or information. 6
Petitioner vehemently objected to the resolution of the issue in that manner, contending
that what counsel for Rita de los Reyes presented before the Municipal Court of Bauan
were only these two motions; viz: (1) to strike out complaining witness' testimony
concerning the cash voucher on the ground of immateriality and variance with the
Information which did not allege the existence of said voucher and three checks; and
(2) a motion objecting to any and all other questions concerning the checks in the total
amount of P1,632.97 on the ground of variance inasmuch as the Information recited
that the accused received and misappropriated the amount of P127.58 only.
In other words, it is petitioner's stand that since these were the only motions that were
denied by the Municipal Court, it is their denial that is accordingly questioned by way
of certiorari before the Court of First Instance and that when the latter court went
beyond the merits of the motions in question, it acted improperly for in so doing, it did
not give the adverse party a chance to argue the point and receive evidence on the
question.
We disagree. The facts of the case, culled from petitioner-appellant's brief itself, show
that aside from the two motions above-mentioned, private respondent moved to strike
out complaining witness' testimony "relating to the receipt (voucher) of the three
checks" and cashing thereof by the accused Rita de los Reyes, which, according to
counsel, is at variance with the allegation in the Information, it appearing that there is
no allegation or averment therein that "the accused received the checks," that those
checks "were cashed by the accused", and that the accused got a portion of the amount
or cash "for the purpose of having it delivered to Cesar Dalangin." 7
The issue of variance between the mode or from of estafa alleged in the Information
and that sought to be proved by the testimony may be inferred from the foregoing
motion to strike out. Contrary also to petitioner's contention in her brief before this
Court that this issue was not raised in Civil Case No. 81 in the Court of First Instance
of Batangas, private respondent aptly quoted her arguments in her memorandum dated
February 3, 1974 before said court showing that the issue was in fact raised, to wit:
... the information charges the accused with Estafa under Article 315, 4th par., No. 1,
letter (b) of the Revised Penal Code, the allegation being that the accused, with
unfaithfulness and abuse of confidence, misappropriated and converted the amount of
P127.58 which she received in trust for a certain specific purpose. But, the evidence
consisting of the testimony of the complainant, as already adverted to in the foregoing
discussion, tends to prove another kind of estafa which may fan under Article 315, 4th
par., No. 2, letter (a) of the Revised Penal Code wherein the punishable act consists of
using false pretenses or fraudulent act. This is so because, according to the
complainant's testimony, the accused made false pretense or misrepresentation that the
157
amount of P127.58 was due in favor of Cesar Dalangin. The essence therefore of the
criminal act shown by the testimonial evidence is the element of deceit, and this is an
entirely different kind of estafa (from that) charged against the accused in the
information under which she was arraigned and pleaded not guilty. 8
After threshing out this preliminary matter of whether the issue at hand was raised or
not, We now proceed with the resolution of the said issue.
It is fundamental that every element of which the offense is composed must be alleged
in the complaint or information. What facts and circumstances are necessary to be
stated must be determined by reference to the definitions and the essentials of the
specific crimes. 9
Thus, in the case at bar, inasmuch as the crime of estafa through misappropriation or
with grave abuse of confidence is charged, the information must contain these
elements: (a) that personal property is received in trust, on commission, for
administration or under any other circumstance involving the duty to make delivery of
or to return the same, even though the obligation is guaranteed by a bond; (b) that there
is conversion or diversion of such property by the person who has so received it; (c)
that such conversion, diversion or denial is to the injury of another and (d) that there be
demand for the return of the property. 10
The main purpose of requiring the various elements of a crime to be set out in an
information is to enable the accused to suitably prepare his defense. He is presumed to
have no independent knowledge of the facts that constitute the offense. 11
However, it is often difficult to say what is a matter of evidence, as distinguished from
facts necessary to be stated in order to render the information sufficiently certain to
Identify the offense. As a general rule, matters of evidence, as distinguished from facts
essential to the description of the offense, need not be averred. 12 For instance, it is not
necessary to show on the face of an information for forgery in what manner a person is
to be defrauded, as that is a matter of evidence at the trial. 13
Moreover, reasonable certainty in the statement of the crime suffices. All that is
required is that the charge be set forth with such particularity as will reasonably
indicate the exact offense which the accused is alleged to have committed and will
enable him intelligently to prepare his defense, and if found guilty to plead her
conviction, in a subsequent prosecution for the same offense. 14
Applying these principles, We rule that the existence of the three checks need not be
alleged in the Information. This is an evidentiary matter which is not required to be
alleged therein. Further, that these checks, as testified by petitioner amounted to
P1,632.97 did not vary the allegation in the Information that respondent Rita de los
Reyes misappropriated the amount of P127.58. Proof of the checks and their total
amount was material evidence of the fact that respondent misappropriated the amount
of P127.58 which was but a part of the total sum of the checks.
Inasmuch as the Information herein sufficiently charges the crime of estafa under
paragraph 1(b) of Article 315, Revised Penal Code, We shall now determine whether
the testimonies of complaining witness prove the same or tend to prove instead estafa
under paragraph 2(a) of the same article.
It is true that estafa under paragraph 1(b) is essentially a different offense from estafa
under paragraph 2(a) of the same article because the elements of these two offenses are
not the same. In estafa under paragraph 1(b), which is committed with grave abuse of
confidence, it must be shown that the offender received money or other personalty in
trust or on commission or for administration, or under any other obligation involving
the duty to make delivery of or to return the same but misappropriated it to the
prejudice of another. It is also necessary that previous demand be made on the
offender. To sustain a conviction for estafa under paragraph 2(a), on the other hand,
deceit or false representation to defraud and the damage caused thereby must be
proved. And no demand is necessary. 15
This does not mean, however, that presentation of proof of deceit in a prosecution for
estafa under paragraph 1(b) is not allowed. Abuse of confidence and deceit may co-
exist. Even if deceit may be present, the abuse of confidence win characterize the
estafa as the deceit will be merely incidental or as the Supreme Court of Spain held, is
absorbed by abuse of confidence. 16
It has also been held that as long as there is a relation of trust and confidence between
the complainant and the accused and even though such relationship has been induced
by the accused thru false representations and pretense and which is continued by active
deceit without truthfully disclosing the facts to the complainant, the estafa committed
is by abuse of confidence although deceit co-exists in its commission. 17
Thus, the questioned testimony eliciting the fact that accused respondent falsely
represented to the complainant-petitioner that the amount of P127.58 out of the total of
P1,632.97 belonged to Cesar Dalangin may not be said to be at variance with the
allegations of the Information. The presence of deceit would not change the whole
theory of the prosecution that estafa with abuse of confidence was committed. Besides,
in estafa by means of deceit, it is essential that the false statement or fraudulent
representation constitutes the very cause or the only motive which induces the
complainant to part with the thing. 18 The municipal court properly denied, therefore,
the motion to strike out the testimonies anent use of false representations.
WHEREFORE, the decision of the Court of First Instance of Batangas, Branch II in
Civil Case No. 81, ordering the questioned testimonies to be stricken from the record is
hereby REVERSED and SET ASIDE.
158
SO ORDERED.
Notes.—The prosecution of criminal actions is always under the direction and control
of the Fiscal. (People vs. Valdemoro, 102 SCRA 171.)
An amended information is valid where it has no substantial difference with the
original information and defendant apprised of the contents of the amended
information. (People vs. Yutila, 102 SCRA 264.)
Fiscals have the primary responsibility to frame informations with due care so as to
avoid controversy as to the definite nature of the offense charged therein. (People vs.
Pardilla, 92 SCRA 591.)
To quash an information is not a ministerial function, hence, not a basis for filing of
mandamus. (People vs. Ramos, 83 SCRA 1.)
An information is not defective where it clearly specified the stolen property. (Izon vs.
People, 107 SCRA 118.)
Not informing the accused of the technical name of the crime he stands charged is not
violative of his substantial rights. (Izon vs. People, 107 SCRA 118.) Balitaan vs. Court
of First Instance of Batangas, 115 SCRA 729, No. L-38544 July 30, 1982
G.R. No. 111538. February 26, 1997
PARAÑAQUE KINGS ENTERPRISES, INCORPORATED, petitioner, vs.
COURT OF APPEALS, CATALINA L. SANTOS, represented by her attorney-
in-fact, LUZ B. PROTACIO, and DAVID A. RAYMUNDO, respondents.
Actions; Pleadings and Practice; Procedural Rules; When noncompliance with the
Rules was not intended for delay or did not result in prejudice to the adverse party,
dismissal of appeal on mere technicalities—in cases where appeal is a matter of right
—may be stayed, in the exercise of the court’s equity jurisdiction.—We first dispose of
the procedural issue raised by respondents, particularly petitioner’s failure to file
twelve (12) copies of its brief. We have ruled that when non-compliance with the
Rules was not intended for delay or did not result in prejudice to the adverse party,
dismissal of appeal on mere technicalities—in cases where appeal is a matter of right
—may be stayed, in the exercise of the court’s equity jurisdiction. It does not appear
that respondents were unduly prejudiced by petitioner’s nonfeasance. Neither has it
been shown that such failure was intentional.
Same; Words and Phrases; Questions of Law and Questions of Fact; There is a
question of law in a given case when the doubt or difference arises as to what the law
is on a certain state of facts, and there is a question of fact when the doubt or difference
arises as to the truth or the falsehood of alleged facts.—We do not agree with
respondents’ contention that the issue involved is purely factual. The principal legal
question, as stated earlier, is whether the complaint filed by herein petitioner in the
lower court states a valid cause of action. Since such question assumes the facts
alleged in the complaint as true, it follows that the determination thereof is one of law,
and not of facts. There is a question of law in a given case when the doubt or
difference arises as to what the law is on a certain state of facts, and there is a question
of fact when the doubt or difference arises as to the truth or the falsehood of alleged
facts.
Same; Cause of Action, Elements of.—A cause of action exists if the following
elements are present: (1) a right in favor of the plaintiff by whatever means and under
whatever law it arises or is created; (2) an obligation on the part of the named
defendant to respect or not to violate such right; and (3) an act or omission on the part
of such defendant violative of the right of plaintiff or constituting a breach of the
obligation of defendant to the plaintiff for which the latter may maintain an action for
recovery of damages.
Same; Same; To sustain a motion to dismiss for lack of cause of action, the complaint
must show that the claim does not exist, rather than that a claim has been defectively
stated, or is ambiguous, indefinite or uncertain.—In determining whether allegations of
a complaint are sufficient to support a cause of action, it must be borne in mind that the
complaint does not have to establish or allege facts proving the existence of a cause of
159
action at the outset; this will have to be done at the trial on the merits of the case. To
sustain a motion to dismiss for lack of cause of action, the complaint must show that
the claim for relief does not exist, rather than that a claim has been defectively stated,
or is ambiguous, indefinite or uncertain.
Actions; Pleadings and Practice; Motions to Dismiss; While in the resolution of a
motion to dismiss, the truth of the facts alleged in the complaint are theoretically
admitted, such admission is merely hypothetical and only for the purpose of resolving
the motion—in case of denial, the movant is not deprived of the right to submit its own
case and to submit evidence to rebut the allegations in the complaint, and neither will
the grant of the motion by a trial court and the ultimate reversal thereof by an appellate
court have the effect of stifling such right.—While the lower courts erred in dismissing
the complaint, private respondents, however, cannot be denied their day in court.
While, in the resolution of a motion to dismiss, the truth of the facts alleged in the
complaint are theoretically admitted, such admission is merely hypothetical and only
for the purpose of resolving the motion. In case of denial, the movant is not to be
deprived of the right to submit its own case and to submit evidence to rebut the
allegations in the complaint. Neither will the grant of the motion by a trial court and
the ultimate reversal thereof by an appellate court have the effect of stifling such right.
So too, the trial court should be given the opportunity to evaluate the evidence, apply
the law and decree the proper remedy. Hence, we remand the instant case to the trial
court to allow private respondents to have their day in court. Parañaque Kings
Enterprises, Inc. vs. Court of Appeals, 268 SCRA 727, G.R. No. 111538 February 26,
1997
Do allegations in a complaint showing violation of a contractual right of "first option
or priority to buy the properties subject of the lease" constitute a valid cause of action?
Is the grantee of such right entitled to be offered the same terms and conditions as
those given to a third party who eventually bought such properties? In short, is such
right of first refusal enforceable by an action for specific performance?
These questions are answered in the affirmative by this Court in resolving this petition
for review under Rule 45 of the Rules of Court challenging the Decision 1 of the Court
of Appeals 2 promulgated on March 29, 1993, in CA-G.R. CV No. 34987 entitled
"Parañaque Kings Enterprises, Inc. vs. Catalina L. Santos, et al.," which affirmed the
order 3 of September 2, 1991, of the Regional Trial Court of Makati, Branch
57, 4 dismissing Civil Case No. 91-786 for lack of a valid cause of action.
Facts of the Case
On March 19, 1991, herein petitioner filed before the Regional Trial Court of Makati a
complaint, 5 which is reproduced in full below:
Plaintiff, by counsel, respectfully states that:
1. Plaintiff is a private corporation organized and existing under and by virtue of the
laws of the Philippines, with principal place of business of (sic) Dr. A. Santos Avenue,
Parañaque, Metro Manila, while defendant Catalina L. Santos, is of legal age, widow,
with residence and postal address at 444 Plato Street, Ct., Stockton, California, USA,
represented in this action by her attorney-in-fact, Luz B. Protacio, with residence and
postal address at No, 12, San Antonio Street, Magallanes Village, Makati, Metro
Manila, by virtue of a general power of attorney. Defendant David A. Raymundo, is of
legal age, single, with residence and postal address at 1918 Kamias Street, Damariñas
Village, Makati, Metro Manila, where they (sic) may be served with summons and
other court processes. Xerox copy of the general power of attorney is hereto attached
as Annex "A".
2. Defendant Catalina L. Santos is the owner of eight (8) parcels of land located at (sic)
Parañaque, Metro Manila with transfer certificate of title nos. S-19637, S-19638 and S-
19643 to S-19648. Xerox copies of the said title (sic) are hereto attached as Annexes
"B" to "I", respectively.
3. On November 28, 1977, a certain Frederick Chua leased the above-described
property from defendant Catalina L. Santos, the said lease was registered in the
Register of Deeds. Xerox copy of the lease is hereto attached as Annex "J".
4. On February 12, 1979, Frederick Chua assigned all his rights and interest and
participation in the leased property to Lee Ching Bing, by virtue of a deed of
assignment and with the conformity of defendant Santos, the said assignment was also
registered. Xerox copy of the deed of assignment is hereto attached as Annex "K".
5. On August 6, 1979, Lee Ching Bing also assigned all his rights and interest in the
leased property to Parañaque Kings Enterprises, Incorporated by virtue of a deed of
assignment and with the conformity of defendant Santos, the same was duly registered,
Xerox copy of the deed of assignment is hereto attached as Annex "L".
6. Paragraph 9 of the assigned leased (sic) contract provides among others that:
"9. That in case the properties subject of the lease agreement are sold or encumbered,
Lessors shall impose as a condition that the buyer or mortgagee thereof shall recognize
and be bound by all the terms and conditions of this lease agreement and shall respect
this Contract of Lease as if they are the LESSORS thereof and in case of sale, LESSEE
shall have the first option or priority to buy the properties subject of the lease;"
7. On September 21, 1988, defendant Santos sold the eight parcels of land subject of
the lease to defendant David Raymundo for a consideration of FIVE MILLION
(P5,000,000.00) PESOS. The said sale was in contravention of the contract of lease,
for the first option or priority to buy was not offered by defendant Santos to the
plaintiff. Xerox copy of the deed of sale is hereto attached as Annex "M".
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8. On March 5, 1989, defendant Santos wrote a letter to the plaintiff informing the
same of the sale of the properties to defendant Raymundo, the said letter was
personally handed by the attorney-in-fact of defendant Santos, Xerox copy of the letter
is hereto attached as Annex "N".
9. Upon learning of this fact plaintiff's representative wrote a letter to defendant
Santos, requesting her to rectify the error and consequently realizing the error, she had
it reconveyed to her for the same consideration of FIVE MILLION (P5,000,000.00)
PESOS. Xerox copies of the letter and the deed of reconveyance are hereto attached as
Annexes "O" and "P".
10. Subsequently the property was offered for sale to plaintiff by the defendant for the
sum of FIFTEEN MILLION (P15,000,000.00) PESOS. Plaintiff was given ten (10)
days to make good of the offer, but therefore (sic) the said period expired another letter
came from the counsel of defendant Santos, containing the same tenor of (sic) the
former letter. Xerox copies of the letters are hereto attached as Annexes "Q" and "R".
11. On May 8, 1989, before the period given in the letter offering the properties for
sale expired, plaintiff's counsel wrote counsel of defendant Santos offering to buy the
properties for FIVE MILLION (P5,000,000.00) PESOS. Xerox copy of the letter is
hereto attached as Annex "S".
12. On May 15, 1989, before they replied to the offer to purchase, another deed of sale
was executed by defendant Santos (in favor of) defendant Raymundo for a
consideration of NINE MILLION (P9,000,000.00) PESOS. Xerox copy of the second
deed of sale is hereto attached as Annex "T".
13. Defendant Santos violated again paragraph 9 of the contract of lease by executing a
second deed of sale to defendant Raymundo.
14. It was only on May 17, 1989, that defendant Santos replied to the letter of the
plaintiff's offer to buy or two days after she sold her properties. In her reply she stated
among others that the period has lapsed and the plaintiff is not a privy (sic) to the
contract. Xerox copy of the letter is hereto attached as Annex "U".
15. On June 28, 1989, counsel for plaintiff informed counsel of defendant Santos of the
fact that plaintiff is the assignee of all rights and interest of the former lessor. Xerox
copy of the letter is hereto attached as Annex "V".
16. On July 6, 1989, counsel for defendant Santos informed the plaintiff that the new
owner is defendant Raymundo. Xerox copy of the letter is hereto attached as Annex
"W".
17. From the preceding facts it is clear that the sale was simulated and that there was a
collusion between the defendants in the sales of the leased properties, on the ground
that when plaintiff wrote a letter to defendant Santos to rectify the error, she
immediately have (sic) the property reconveyed it (sic) to her in a matter of twelve (12)
days.
18. Defendants have the same counsel who represented both of them in their exchange
of communication with plaintiff's counsel, a fact that led to the conclusion that a
collusion exist (sic) between the defendants.
19. When the property was still registered in the name of defendant Santos, her
collector of the rental of the leased properties was her brother-in-law David Santos and
when it was transferred to defendant Raymundo the collector was still David Santos up
to the month of June, 1990. Xerox copies of cash vouchers are hereto attached as
Annexes "X" to "HH", respectively.
20. The purpose of this unholy alliance between defendants Santos and Raymundo is to
mislead the plaintiff and make it appear that the price of the leased property is much
higher than its actual value of FIVE MILLION (P5,000,000.00) PESOS, so that
plaintiff would purchase the properties at a higher price.
21. Plaintiff has made considerable investments in the said leased property by erecting
a two (2) storey, six (6) doors commercial building amounting to THREE MILLION
(P3,000,000.00) PESOS. This considerable improvement was made on the belief that
eventually the said premises shall be sold to the plaintiff.
22. As a consequence of this unlawful act of the defendants, plaintiff will incurr (sic)
total loss of THREE MILLION (P3,000,000.00) PESOS as the actual cost of the
building and as such defendants should be charged of the same amount for actual
damages.
23. As a consequence of the collusion, evil design and illegal acts of the defendants,
plaintiff in the process suffered mental anguish, sleepless nights, bismirched (sic)
reputation which entitles plaintiff to moral damages in the amount of FIVE MILLION
(P5,000,000.00) PESOS.
24. The defendants acted in a wanton, fraudulent, reckless, oppressive or malevolent
manner and as a deterrent to the commission of similar acts, they should be made to
answer for exemplary damages, the amount left to the discretion of the Court.
25. Plaintiff demanded from the defendants to rectify their unlawful acts that they
committed, but defendants refused and failed to comply with plaintiffs just and valid
and (sic) demands. Xerox copies of the demand letters are hereto attached as Annexes
"KK" to "LL", respectively.
26. Despite repeated demands, defendants failed and refused without justifiable cause
to satisfy plaintiff's claim, and was constrained to engaged (sic) the services of
undersigned counsel to institute this action at a contract fee of P200,000.00, as and for
attorney's fees, exclusive of cost and expenses of litigation.
161
PRAYER
WHEREFORE, it is respectfully prayed, that judgment be rendered in favor of the
plaintiff and against defendants and ordering that:
a. The Deed of Sale between defendants dated May 15, 1989, be annulled and the
leased properties be sold to the plaintiff in the amount of P5,000,000.00;
b. Dependants (sic) pay plaintiff the sum of P3,000,000.00 as actual damages;
c. Defendants pay the sum of P5,000,000.00 as moral damages;
d. Defendants pay exemplary damages left to the discretion of the Court;
e. Defendants pay the sum of not less than P200,000.00 as attorney's fees.
Plaintiff further prays for other just and equitable reliefs plus cost of suit.
Instead of filing their respective answers, respondents filed motions to dismiss
anchored on the grounds of lack of cause of action, estoppel and laches.
On September 2, 1991, the trial court issued the order dismissing the complaint for
lack of a valid cause of action. It ratiocinated thus:
Upon the very face of the plaintiff's Complaint itself, it therefore indubitably appears
that the defendant Santos had verily complied with paragraph 9 of the Lease
Agreement by twice offering the properties for sale to the plaintiff for ~1 5 M. The
said offers, however, were plainly rejected by the plaintiff which scorned the said offer
as "RIDICULOUS". There was therefore a definite refusal on the part of the plaintiff
to accept the offer of defendant Santos. For in acquiring the said properties back to her
name, and in so making the offers to sell both by herself (attorney-in-fact) and through
her counsel, defendant Santos was indeed conscientiously complying with her
obligation under paragraph 9 of the Lease Agreement. . . . .
xxx xxx xxx
This is indeed one instance where a Complaint, after barely commencing to create a
cause of action, neutralized itself by its subsequent averments which erased or
extinguished its earlier allegations of an impending wrong. Consequently, absent any
actionable wrong in the very face of the Complaint itself, the plaintiffs subsequent
protestations of collusion is bereft or devoid of any meaning or purpose. . . . .
The inescapable result of the foregoing considerations point to no other conclusion
than that the Complaint actually does not contain any valid cause of action and should
therefore be as it is hereby ordered DISMISSED. The Court finds no further need to
consider the other grounds of estoppel and laches inasmuch as this resolution is
sufficient to dispose the matter. 6
Petitioners appealed to the Court of Appeals which affirmed in toto the ruling of the
trial court, and further reasoned that:
. . . . Appellant's protestations that the P15 million price quoted by appellee Santos was
reduced to P9 million when she later resold the leased properties to Raymundo has no
valid legal moorings because appellant, as a prospective buyer, cannot dictate its own
price and forcibly ram it against appellee Santos, as owner, to buy off her leased
properties considering the total absence of any stipulation or agreement as to the price
or as to how the price should be computed under paragraph 9 of the lease
contract, . . . . 7
Petitioner moved for reconsideration but was denied in an order dated August 20,
1993. 8
Hence this petition. Subsequently, petitioner filed an "Urgent Motion for the Issuance
of Restraining Order and/or Writ of Preliminary Injunction and to Hold Respondent
David A. Raymundo in Contempt of Court." 9 The motion sought to enjoin respondent
Raymundo and his counsel from pursuing the ejectment complaint filed before the
barangay captain of San Isidro, Parañaque, Metro Manila; to direct the dismissal of
said ejectment complaint or of any similar action that may have been filed; and to
require respondent Raymundo to explain why he should not be held in contempt of
court for forum-shopping. The ejectment suit initiated by respondent Raymundo
against petitioner arose from the expiration of the lease contract covering the property
subject of this case. The ejectment suit was decided in favor of Raymundo, and the
entry of final judgment in respect thereof renders the said motion moot and academic.
Issue
The principal legal issue presented before us for resolution is whether the aforequoted
complaint alleging breach of the contractual right of "first option or priority to buy"
states a valid cause of action.
Petitioner contends that the trial court as well as the appellate tribunal erred in
dismissing the complaint because it in fact had not just one but at least three (3) valid
causes of action, to wit: (1) breach of contract, (2) its right of first refusal founded in
law, and (3) damages.
Respondents Santos and Raymundo, in their separate comments, aver that the petition
should be denied for not raising a question of law as the issue involved is purely
factual — whether respondent Santos complied with paragraph 9 of the lease
agreement — and for not having complied with Section 2, Rule 45 of the Rules of
Court, requiring the filing of twelve (12) copies of the petitioner's brief. Both maintain
that the complaint filed by petitioner before the Regional Trial Court of Makati stated
no valid cause of action and that petitioner failed to substantiate its claim that the lower
courts decided the same "in a way not in accord with law and applicable decisions of
162
the Supreme Court"; or that the Court of Appeals has "sanctioned departure by a trial
court from the accepted and usual course of judicial proceedings" so as to merit the
exercise by this Court of the power of review under Rule 45 of the Rules of Court.
Furthermore, they reiterate estoppel and laches as grounds for dismissal, claiming that
petitioner's payment of rentals of the leased property to respondent Raymundo from
June 15, 1989, to June 30, 1990, was an acknowledgment of the latter's status as new
owner-lessor of said property, by virtue of which petitioner is deemed to have waived
or abandoned its first option to purchase.
Private respondents likewise contend that the deed of assignment of the lease
agreement did not include the assignment of the option to purchase. Respondent
Raymundo further avers that he was not privy to the contract of lease, being neither the
lessor nor lessee adverted to therein, hence he could not be held liable for violation
thereof.
The Court's Ruling
Preliminary Issue: Failure to File
Sufficient Copies of Brief
We first dispose of the procedural issue raised by respondents, particularly petitioner's
failure to file twelve (12) copies of its brief. We have ruled that when non-compliance
with the Rules was not intended for delay or did not result in prejudice to the adverse
party, dismissal of appeal on mere technicalities — in cases where appeal is a matter of
right — may be stayed, in the exercise of the court's equity jurisdiction. 10 It does not
appear that respondents were unduly prejudiced by petitioner's nonfeasance. Neither
has it been shown that such failure was intentional.
Main Issue: Validity of Cause of Action
We do not agree with respondents' contention that the issue involved is purely factual.
The principal legal question, as stated earlier, is whether the complaint filed by herein
petitioner in the lower court states a valid cause of action. Since such question assumes
the facts alleged in the complaint as true, it follows that the determination thereof is
one of law, and not of facts. There is a question of law in a given case when the doubt
or difference arises as to what the law is on a certain state of facts, and there is a
question of fact when the doubt or difference arises as to the truth or the falsehood of
alleged facts. 11
At the outset, petitioner concedes that when the ground for a motion to dismiss is lack
of cause of action, such ground must appear on the face of the complaint; that to
determine the sufficiency of a cause of action, only the facts alleged in the complaint
and no others should be considered; and that the test of sufficiency of the facts alleged
in a petition or complaint to constitute a cause of action is whether, admitting the facts
alleged, the court could render a valid judgment upon the same in accordance with the
prayer of the petition or complaint.
A cause of action exists if the following elements are present: (1) a right in favor of the
plaintiff by whatever means and under whatever law it arises or is created; (2) an
obligation on the part of the named defendant to respect or not to violate such right,
and (3) an act or omission on the part of such defendant violative of the right of
plaintiff or constituting a breach of the obligation of defendant to the plaintiff for
which the latter may maintain an action for recovery of damages. 12
In determining whether allegations of a complaint are sufficient to support a cause of
action, it must be borne in mind that the complaint does not have to establish or allege
facts proving the existence of a cause of action at the outset; this will have to be done
at the trial on the merits of the case. To sustain a motion to dismiss for lack of cause of
action, the complaint must show that the claim for relief does not exist, rather than that
a claim has been defectively stated, or is ambiguous, indefinite or uncertain. 13
Equally important, a defendant moving to dismiss a complaint on the ground of lack of
cause of action is regarded as having hypothetically admitted all the averments
thereof. 14
A careful examination of the complaint reveals that it sufficiently alleges an actionable
contractual breach on the part of private respondents. Under paragraph 9 of the
contract of lease between respondent Santos and petitioner, the latter was granted the
"first option or priority" to purchase the leased properties in case Santos decided to
sell. If Santos never decided to sell at all, there can never be a breach, much less an
enforcement of such "right." But on September 21, 1988, Santos sold said properties to
Respondent Raymundo without first offering these to petitioner. Santos indeed realized
her error, since she repurchased the properties after petitioner complained. Thereafter,
she offered to sell the properties to petitioner for P15 million, which petitioner,
however, rejected because of the "ridiculous" price. But Santos again appeared to have
violated the same provision of the lease contract when she finally resold the properties
to respondent Raymundo for only P9 million without first offering them to
petitioner at such price. Whether there was actual breach which entitled petitioner to
damages and/or other just or equitable relief, is a question which can better be resolved
after trial on the merits where each party can present evidence to prove their respective
allegations and defenses. 15
The trial and appellate courts based their decision to sustain respondents' motion to
dismiss on the allegations of Parañaque Kings Enterprises that Santos had actually
offered the subject properties for sale to it prior to the final sale in favor of Raymundo,
but that the offer was rejected. According to said courts, with such offer, Santos had
verily complied with her obligation to grant the right of first refusal to petitioner.
163
We hold, however, that in order to have full compliance with the contractual right
granting petitioner the first option to purchase, the sale of the properties for the amount
of P9 million, the price for which they were finally sold to respondent Raymundo,
should have likewise been first offered to petitioner.
The Court has made an extensive and lengthy discourse on the concept of, and
obligations under, a right of first refusal in the case of Guzman, Bocaling &
Co. vs. Bonnevie. 16 In that case, under a contract of lease, the lessees (Raul and
Christopher Bonnevie) were given a "right of first priority" to purchase the leased
property in case the lessor (Reynoso) decided to sell. The selling price quoted to the
Bonnevies was 600,000.00 to be fully paid in cash, less a mortgage lien of
P100,000.00. On the other hand, the selling price offered by Reynoso to and accepted
by Guzman was only P400,000.00 of which P137,500.00 was to be paid in cash while
the balance was to be paid only when the property was cleared of occupants. We held
that even if the Bonnevies could not buy it at the price quoted (P600,000.00),
nonetheless, Reynoso could not sell it to another for a lower price and under more
favorable terms and conditions without first offering said favorable terms and price to
the Bonnevies as well. Only if the Bonnevies failed to exercise their right of first
priority could Reynoso thereafter lawfully sell the subject property to others, and only
under the same terms and conditions previously offered to the Bonnevies.
Of course, under their contract, they specifically stipulated that the Bonnevies could
exercise the right of first priority, "all things and conditions being equal." This Court
interpreted this proviso to mean that there should be identity of terms and conditions to
be offered to the Bonnevies and all other prospective buyers, with the Bonnevies to
enjoy the right of first priority. We hold that the same rule applies even without the
same proviso if the right of first refusal (or the first option to buy) is not to be
rendered illusory.
From the foregoing, the basis of the right of first refusal* must be the current offer to
sell of the seller or offer to purchase of any prospective buyer. Only after the optionee
fails to exercise its right of first priority under the same terms and within the period
contemplated, could the owner validly offer to sell the property to a third person,
again, under the same terms as offered to the optionee.
This principle was reiterated in the very recent case of Equatorial Realty vs. Mayfair
Theater, Inc. 17 which was decided en banc. This Court upheld the right of first refusal
of the lessee Mayfair, and rescinded the sale of the property by the lessor Carmelo to
Equatorial Realty "considering that Mayfair, which had substantial interest over the
subject property, was prejudiced by its sale to Equatorial without Carmelo conferring
to Mayfair every opportunity to negotiate within the 30-day stipulated period"
(emphasis supplied).
In that case, two contracts of lease between Carmelo and Mayfair provided "that if the
LESSOR should desire to sell the leased premises, the LESSEE shall be given 30 days
exclusive option to purchase the same." Carmelo initially offered to sell the leased
property to Mayfair for six to seven million pesos. Mayfair indicated interest in
purchasing the property though it invoked the 30-day period. Nothing was heard
thereafter from Carmelo. Four years later, the latter sold its entire Recto Avenue
property, including the leased premises, to Equatorial for P11,300,000.00 without
priorly informing Mayfair. The Court held that both Carmelo and Equatorial acted in
bad faith: Carmelo for knowingly violating the right of first option of Mayfair, and
Equatorial for purchasing the property despite being aware of the contract stipulation.
In addition to rescission of the contract of sale, the Court ordered Carmelo to allow
Mayfair to buy the subject property at the same price of P11,300,000.00.
No cause of action
under P.D. 1517
Petitioner also invokes Presidential Decree No. 1517, or the Urban Land Reform Law,
as another source of its right of first refusal. It claims to be covered under said law,
being the "rightful occupant of the land and its structures" since it is the lawful lessee
thereof by reason of contract. Under the lease contract, petitioner would have occupied
the property for fourteen (14) years at the end of the contractual period.
Without probing into whether petitioner is rightfully a beneficiary under said law,
suffice it to say that this Court has previously ruled that under
Section 6 18 of P.D. 1517, "the terms and conditions of the sale in the exercise of the
lessee's right of first refusal to purchase shall be determined by the Urban Zone
Expropriation and Land Management Committee. Hence, . . . . certain prerequisites
must be complied with by anyone who wishes to avail himself of the benefits of the
decree." 19 There being no allegation in its complaint that the prerequisites were
complied with, it is clear that the complaint did fail to state a cause of action on this
ground.
Deed of Assignment included
the option to purchase
Neither do we find merit in the contention of respondent Santos that the assignment of
the lease contract to petitioner did not include the option to purchase. The provisions of
the deeds of assignment with regard to matters assigned were very clear. Under the
first assignment between Frederick Chua as assignor and Lee Ching Bing as assignee,
it was expressly stated that:
. . . . the ASSIGNOR hereby CEDES, TRANSFERS and ASSIGNS to herein
ASSIGNEE, all his rights, interest and participation over said premises afore-
described, . . . . 20 (emphasis supplied)
164
And under the subsequent assignment executed between Lee Ching Bing as assignor
and the petitioner, represented by its Vice President Vicenta Lo Chiong, as assignee, it
was likewise expressly stipulated that;
. . . . the ASSIGNOR hereby sells, transfers and assigns all his rights, interest and
participation over said leased premises, . . . . 21 (emphasis supplied)
One of such rights included in the contract of lease and, therefore, in the assignments
of rights was the lessee's right of first option or priority to buy the properties subject of
the lease, as provided in paragraph 9 of the assigned lease contract. The deed of
assignment need not be very specific as to which rights and obligations were passed on
to the assignee. It is understood in the general provision aforequoted that all specific
rights and obligations contained in the contract of lease are those referred to as being
assigned. Needless to state, respondent Santos gave her unqualified conformity to both
assignments of rights.
Respondent Raymundo privy
to the Contract of Lease
With respect to the contention of respondent Raymundo that he is not privy to the lease
contract, not being the lessor nor the lessee referred to therein, he could thus not have
violated its provisions, but he is nevertheless a proper party. Clearly, he stepped into
the shoes of the owner-lessor of the land as, by virtue of his purchase, he assumed all
the obligations of the lessor under the lease contract. Moreover, he received benefits in
the form of rental payments. Furthermore, the complaint, as well as the petition, prayed
for the annulment of the sale of the properties to him. Both pleadings also alleged
collusion between him and respondent Santos which defeated the exercise by petitioner
of its right of first refusal.
In order then to accord complete relief to petitioner, respondent Raymundo was a
necessary, if not indispensable, party to the case. 22 A favorable judgment for the
petitioner will necessarily affect the rights of respondent Raymundo as the buyer of the
property over which petitioner would like to assert its right of first option to buy.
Having come to the conclusion that the complaint states a valid cause of action for
breach of the right of first refusal and that the trial court should thus not have
dismissed the complaint, we find no more need to pass upon the question of whether
the complaint states a cause of action for damages or whether the complaint is barred
by estoppel or laches. As these matters require presentation and/or determination of
facts, they can be best resolved after trial on the merits.
While the lower courts erred in dismissing the complaint, private respondents,
however, cannot be denied their day in court. While, in the resolution of a motion to
dismiss, the truth of the facts alleged in the complaint are theoretically admitted, such
admission is merely hypothetical and only for the purpose of resolving the motion. In
case of denial, the movant is not to be deprived of the right to submit its own case and
to submit evidence to rebut the allegations in the complaint. Neither will the grant of
the motion by a trial court and the ultimate reversal thereof by an appellate court have
the effect of stifling such right. 23 So too, the trial court should be given the opportunity
to evaluate the evidence, apply the law and decree the proper remedy. Hence, we
remand the instant case to the trial court to allow private respondents to have their day
in court.
WHEREFORE, the petition is GRANTED. The assailed decisions of the trial court and
Court of Appeals are hereby REVERSED and SET ASIDE. The case is REMANDED
to the Regional Trial Court of Makati for further proceedings.
SO ORDERED.
GR No. L- 15756. February 15, 1922
Sinforoso de Gala, plaintiff and appellant, vs. Pedro de Gala et al., defendants.
Josefa Alabastro and Generoso de Gala, appellees.
his action was commenced in the Court of First Instance of the Province of Tayabas on
the 29th day of August, 1917. Its purpose was to compel the defendant Pedro de Gala
to recognize the plaintiff as his natural son. The complaint alleged that the plaintiff had
been in the uninterrupted possession of the status of a natural child of the defendant,
justified by the conduct of the latter and that of his family. To that complaint the
defendant interposed a general denial.
Upon the issue thus presented the cause was brought on for trial, at the close of which
the Honorable Jose C. Abreu, judge, rendered a judgment dismissing the plaintiff's
complaint and absolved the defendant from all liability thereunder, without any finding
as to costs. From that judgment the plaintiff appealed to this court. During the
pendency of the appeal, in this court, the defendant Pedro de Gala died; and, at the
suggestion of the plaintiff, the deceased defendant was substituted in this instance by
his surviving spouse, Josefa Alabastro, and his only legitimate son, Generoso de Gala.
The appellant alleges that the lower court committed an error —
(1) In not admitting plaintiff's Exhibit C in evidence; (2) in finding that the facts in this
case are very similar, if not identical, to those in the case of Buenaventura vs.
Urbano (5 Phil., 1); and (3) in finding that the facts in the present case do not show
that the plaintiff has been in the uninterrupted possession of the status of a natural child
of the defendant Pedro de Gala.
Exhibit C is a transcript of the stenographic notes taken during the trial of an election
protest case (Nadres vs. Javier) in the Court of First Instance of Tayabas, on the 10th
day of August, 1916, two years before the trial of the present case. During that trial (of
Nadres vs. Javier) Generoso de Gala, the said only legitimate son of the defendant
165
Pedro de Gala, testifying as a witness, declared in open court that the plaintiff herein,
Sinforoso de Gala, was his brother. The pertinent part of his testimony was as follows:
Q. Is Eugenio de Gala, the witness who testified before, your brother? — A. Brother
by my father.
Q. And Sinforoso de Gala? — A. Also, brother by my father. (Pages 9 and 10, Exhibit
C.)
That testimony of Generoso de Gala, duly identified by Juan Merchan, clerk of the
Court of First Instance of Tayabas, was offered in evidence by the plaintiff during the
trial of this cause. To its admission the defendant objected upon the ground that it was
"impertinent." The lower court sustained the objection, stating that, in the first place,
the said Generoso de Gala was not an interested party in this case, and, in the second
place, the mere fact that Generoso de Gala declared that Sinforoso de Gala was his
brother would not entitle the latter to be recognized as a natural son of the defendant.
Generoso de Gala, the only legitimate son of the defendant Pedro de Gala, being a
member of the latter's family, his spontaneous admission, publicly made, in open court,
that the plaintiff, Sinforoso de Gala, was his brother, cannot be said to be "impertinent"
for the purpose of proving the plaintiff's claim; for, that admission was a "conduct" on
his part which tends to confirm the status claimed by the alleged natural child. Neither
can it be said that the said only legitimate child of the defendance Pedro de Gala  was
not an interested party in this case (he is now a party appellee herein), for he is a
forced heir of the defendant, and the latter's recognition of the plaintiff as a natural son
would diminish his hereditary rights. And, while it is true that such admission of the
defendant's only legitimate son would not, of itself, be sufficient to entitle the plaintiff
to a compulsory recognition by the defendant as his natural child, yet it should have
been admitted in evidence as a factum probans, which would help to establish
the factum probandum — the uninterrupted possession of the status of a natural child.
Such status, of course, cannot be proved by a single specific act or conduct of the
defendant or of his family. It must necessarily be proved by showing a series of acts,
conduct, and circumstances indicative of the intention of the putative father to
acknowledge his alleged natural child. Hence, to reject evidence of a single act,
conduct, or circumstance as being insufficient to prove the status claimed, would be to
prevent the claimant from proving it at all.
The evident purpose of presenting Exhibit C was to show that the plaintiff had been "in
the uninterrupted possession of the status of a natural child of the defendant father,
justified by the conduct of the father himself or that of his family." For that purpose
Exhibit C was perhaps admissible. However, considering the fact that the plaintiff was
born in the year 1879, before the adoption of the Civil Code, the provisions of  la Ley
de Toro may govern in the solution of the question of recognition. If by the recognition
a right was vested in the plaintiff from acts realized under the legislation preceding the
Civil Code, and if such act gave him the status of legal recognition, then it is clear
from the provisions of the transitory provisions of the Civil Code that the legislation
preceding that Code must govern.
Under la Ley de Toro, a natural child might be recognized tacitly, and the recognition
was open to such proof as would support the fact in an ordinary action. (Decision of
the supreme court of Spain, November 8, 1893, 74 Jurisprudencia Civil, p. 301;
Llorente vs. Rodriguez, 3 Phil., 697.)
It will be found upon an examination of the facts hereinafter stated, that the defendant
not only made a tacit, but a express recognition of the plaintiff as his natural child, both
before and after the adoption of the Civil Code (year 1879).
If acts of recognition took place before the adoption of the Civil Code, and if they were
sufficient under the prior law to constitute a recognition, then the defendant cannot
require the proof of recognition prescribed by the new law (Civil Code).
Appellant's second and third assignments or error may be discussed together, for it is
necessary to determine first the facts in the present case in order to be able to compare
them with those in the case of Buenaventura vs. Urbano, referred to in the second
assignment of error.
The plaintiff-appellant was born on the 17th day of July, 1879, in the municipality of
Tiaong, Province of Tayabas, and was baptized with the name "Sinforoso Dimatulac."
The baptismal certificate (Exhibit B) described him as a "natural son of Dominga
Dimatulac, a single woman, and of an unknown father;" that the said "unknown father"
was no other than the defendant Pedro de Gala in this case, which the evidence
adduced during the trial of the cause reveals in an indirect but most convincing
manner; that at the time of the birth of the plaintiff there existed no impediment to the
marriage of the mother with the alleged father.
Less than a month after the birth of the plaintiff, the defendant was married to Josefa
Alabastro. (Exhibit A.)
During his infancy and childhood, the plaintiff lived with his mother in the barrio of
Quinatihan, of the municipality of Candelaria (formerly Tiaong). In the same barrio
also lived the defendant. The defendant not only frequented the house where the
plaintiff lived with his mother, but provided sustenance for both the latter and the
plaintiff, giving them rice out of hi camarin.
Later, and during his childhood, the defendant sent the plaintiff to a school in the town,
conducted by one Norberto Virrey, and the defendant paid for his instruction. While in
school, the plaintiff was enrolled under the name of "Sinforoso Dimatulac," but was
known and called by his classmates and others by the name "Sinforoso de Gala." It
appears that when he became old enough to know that his father's surname was not
166
Dimatulac but "De Gala," he adopted the latter surname, with the acquiscence of the
defendant.
But the defendant's paternal care and attention for the plaintiff were not confined to the
period of the latter's childhood. He continued to give the plaintiff money to spend even
after the latter had reached more mature years. And not only that: he had a house built
for the plaintiff, and also gave him a parcel of land to cultivate as his own. Later,
however, the plaintiff returned said parcel of land to the defendant, asking that another,
planted with coconuts, be given him in lieu thereof, which the defendant promised to
do.
The proof shows that the plaintiff always addressed the defendant as "father" (tatay), in
public as well as in private, to which address the defendant responded. He was a
frequent caller at the defendant's home. He used to kiss defendant's hand after the
evening prayers. He sat at the table with defendant and his family frequently. He was
in constant company with defendant in the cockpit, not only of Candelaria but also of
other towns. He was regarded as a brother by defendant's only legitimate son; and, in
fact, according to one of the witnesses, the whole town of Candelaria knew the plaintiff
as the natural son of Capitan Pedro de Gala, the defendant. It was not until the present
suit was instituted, that the defendant withdrew his apparent paternal considerations
which he had theretofore always shown towards the plaintiff.
A few quotations from the testimony of witnesses will emphasize the foregoing facts.
Narciso de Gala, nephew of the defendant Pedro de Gala, testified in part as follows:
Q. What is your connection with the plaintiff Sinforoso de Gala? — A. He is my first
cousin.
Q. What is Sinforoso de Gala's connection with the defendant Pedro de Gala? — A. He
is a natural son.
Q. Why do you say that the plaintiff Sinforoso de Gala is the natural child of Pedro de
Gala? — A. Because when he was a child (Sinforoso de Gala) it was the herein
defendant who supported him until he grew up.
Q. Can you tell us whether the plaintiff Sinforoso de Gala has attended any school? —
A. Yes, sir.
Q. Who paid for his education while in school? — A. It was  Capitan Pedro de Gala
who arranged with the schoolmaster so that he might attend school.
Q. Until when he has the plaintiff Sinforoso de Gala been supported or given support
by Capitan Pedro de Gala? — A. After the reconcentration, and even before it I have
seen him give support or maintenance to the herein plaintiff, and it was only one year
since he ceased to do so. (Pages 3 and 4, part I, test.)
xxx     xxx     xxx
Q. Can you tell from your own personal observation the treatment the defendant Pedro
de Gala gives in public and in private and in his house to the plaintiff, Sinforoso de
Gala? — A. As a son. A good treatment.
Q. Have you seen Sinforoso de Gala eat in the house of Pedro de Gala? — A. Yes, sir.
Q. Who else ate with him at the table? — A. We and the married couple.
Q. Whom do you mean by married couple? — A. Capitan Pedro and his wife.
Q. How does the plaintiff Sinforoso de Gala call Pedro de Gala? — A. Father
Q. How did Pedro de Gala answer him? — A. He answered him, "What do you want?"
(Pages 5 and 6, sten. notes.)
Q. Do you know whether Sinforoso de Gala ever had a house in Candelaria? — A.
Yes, sir.
Q. Who paid for the construction of that house? — A. Capita Pedro.
Q. Have you seen Sinforoso de Gala in company with Pedro de Gala? — A. Yes, sir.
Q. On what occasions did you see them? — A. I have seen them together on various
occasions, but cannot tell exactly when.
Q. Are you in the habit of going to the cockpit? — A. Yes, sir.
Q. Have you ever seen them go together to the cockpit? — A. Yes, sir;
and Capitan Pedro used to tell him to bet on the favorite roosters. (Pages 8 and 9, sten.
notes.)
Hermenegildo Nadres, who had been a neighbor of, and had known, the plaintiff since
his infancy, testified in part as follows:
Q. Do you know who looked after the support of Sinforoso de Gala since his birth? —
A. Pedro de Gala
Q. Why can you state that? — A. Because Sinforoso de Gala had no other means of
support, and lived only on what Pedro gave him, and I saw him give several times
because Sinforoso had no means of support and lived only on what Pedro gave.
Q. How often did you see Pedro de Gala go to the house of Sinforoso de Gala? — A.
Many times.
Q. Do you know if Sinforoso de Gala studied in any school? — A. He studied under
Norberto Virrey.
167
Q. Do you know who sent him to the school of Norberto Virrey and who paid for his
schooling? — A. Yes, sir.
Q. Who? — A. Pedro de Gala.
xxx     xxx     xxx
Q. Have you ever head how Sinforoso de Gala calls Pedro de Gala? — A. I have.
Q. How? — A. Father.
xxx     xxx     xxx
Q. Have you heard Sinforoso de Gala call Pedro de Gala father? — A. The whole town
of Candelaria knows that. (Pages 20, 21 and 22, sten. notes.)
xxx     xxx     xxx
Q. What treatment did you see Pedro de Gala give the plaintiff Sinforoso de Gala when
he went to the house of the latter? — A. The treatment accorded to a son.
Q. Did you ever see Sinforoso de Gala kiss the hand of Pedro Gala? — A. Yes, sir.
Q. When did you see Sinforoso kiss Don Pedro's hand? On what occasion? — A.
Many times I have seen him kiss his hand, but I cannot remember how many.
Q. But was it before, or after the revolution against the Americans? — A. Since the
time of the Spanish regime.
Q. Until when? — A. Until they quarreled, and that was the time when the action was
commenced against Don Pedro. (Pages 23 and 24, sten. notes.)
Cross-examination:
Q. You said, have you not, that Sinforoso was treated by Pedro de Gala as his child.
What is your ground for saying that? — A. Because singe Sinforoso was born until he
grew up, he always went in company with Don Pedro wherever he went. (Pages 30,
sten. notes)
Sinforoso de Gala, the plaintiff, testified in part as follows:
Q. Since your earliest recollection, who supported you? — A. My father.
Q. Who is your father? To whom do you refer? — A. That is my father (pointing to the
defendant).
xxx     xxx     xxx
Q. How often did your mother take "palay," from the warehouse? — A. Frequently.
Sometimes we took the "palay," and sometimes it was brought home.
Q. When it was taken to your house by other people, how do you know that it was
Pedro de Gala who sent it? — A. Because my father used to go there and my mother
used to ask him when we had no "palay." (Pages 32 and 33, sten. notes.)
xxx     xxx     xxx
Q. How do you call Capitan Pedro when you meet him? — A. Father
Q. How does he answer? — A. He says to me, "What is it?"
Q. When did you stop going to the house of Pedro de Gala? A. — It is now about a
year that I stopped going to that house.
Q. How many years have you been attending the school of the teacher Berto? — A. I
believe I have been studying with him for over two years.
Q. Have you ever been in company with Pedro de Gala in any other place besides your
house? — A. Many times.
Q. In what places? — A. In Manila, in Tayabas, and here in Lucena on feast days.
Q. How many times in a month did you receive money from Pedro de Gala when he
was giving you money? — A. At any time. Sometimes before the end of the month,
sometimes in the middle of the month, and at certain other times after the end of the
month.
Q. What amount did Pedro de Gala use to give you? — A. He did not give me a fixed
amount; sometimes thirty, sometimes twenty and other times ten pesos. (Pages 36, 37,
and 38, sten. notes.)
168
The facts hereinabove set forth are the salient facts which we find have been proved by
a clear preponderance of the evidence in this case. In arriving at this conclusion we
have taken into consideration (1) the fact that the trial judge himself evidently did not
give credit to the testimony of the defendant and his witnesses, for in his decision he
found certain facts to have been proved which were specifically denied by the
defendant and his witnesses; and (2) by the fact that a perusal of the testimony for the
defense cannot but impress one with its inherent weakness, the same being purely
negative. "It is a general rule of evidence that, all other things being equal, affirmative
testimony is stronger than negative; in other words, that 'the testimony of a credible
witness, that he saw or heard a particular thing at a particular time and place is more
reliable than that of an equally credible witness who, with the same opportunities,
testifies that he did not hear or see the same thing at the same time and place.'" (5
Jones on Evidence, sec. 898, citing several cases; see also 3 Greenl. on Evidence, par.
375; and 10 R. C. L., 1011.)
In the case of Buenaventura vs. Urbano (5 Phil, 1), Conrado Cerrudo claimed to be a
natural child of Telesforo Chuidian, and the action was brought to compel the latter's
heirs to acknowledge or recognize the former as such. In that case this court found the
facts to be as follows:
The other evidence showed that the plaintiff lived with his mother for the first seven
years of his life; that he afterwards lived with his maternal grandmother, and that for
five or six months in the year 1900 or 1901 he lived with Candelaria Chuidian, a sister
of Don Telesforo; that he afterwards lived in the house of Sofia Lopez, a mistress of
Don Telesforo. He never lived in the house of his supposed father, who maintained a
house of his own, in which there lived with him for a time two of his natural children. .
. . Confining ourselves to the acts proved to have been performed by Don Telesforo,
we find that he visited the mother of the plaintiff; that he paid money for her support;
that he paid money for the support of the plaintiff; that he told one witness that the
plaintiff was his son; that the plaintiff called him "Papa," and that Don Telesforo
answered to this designation; that when the plaintiff visited Don Telesforo he kissed
his hand; that Don Telesforo wrote letters to him; that he paid his fees for instruction in
school, and secured him a position in a commercial house.
On the other hand, it is shown that the plaintiff never lived in the house of Don
Telesforo; that the latter made his will on the 19th of December, 1897; that in this will
he recognized as his natural children two persons, Horacio and Beatriz Lopez, children
of Sofia Lopez. He did not recognize the plaintiff by this will. Some of the aforesaid
acts of Don Telesforo were done after the making of his will.
Upon the foregoing facts this court held as follows:
All these facts taken together are not sufficient to show that plaintiff possessed
continuously the status of a natural child. . . . It must appear that it was the intention of
the father to so recognize the child as to give him that status, and that the acts
performed by him were done with that intention.
"The evidence in this case shows beyond question, in our opinion that Don Telesforo
never intended to give this plaintiff any such status. The fact that he never lived in the
house of the former, while two other of his natural children did live there; the fact that
in his will he did not recognize the plaintiff as his natural child, while he did recognize
two other children; the fact that he did not sign his name to the letter offered in
evidence, all show, to our minds, that he never intended to give the plaintiff the status
of a natural child. The acts performed by him for the purpose of giving such status
must be such as to make plain to the public that the child possesses such a condition."
There was no proof presented in that case showing that there were any acts of
recognition prior to the adoption of the Civil Code, and therefore the acts of
recognition, whatever they were, must conform to that Code.
We are inclined to agree with the appellant herein that the facts in
the Urbano case, supra, are not similar to those in the present case in form of
recognition. It will be noted that in the said case there were clear and unmistakable
indications that the putative father did not intend to recognize his alleged natural child:
(1) Conrado (the alleged natural child) never lived with Don Telesforo (the putative
father), while two other of his natural children did live there; (2) in his will Don
Telesforo did not recognize the said Conrado as his natural child, while he did
recognize two other children; (3) Don Telesforo wrote a letter to Conrado, but
purposely avoided signing it; (4) while in the present case there were not only tacit but
actual recognition.
In the present case there are no indications that the defendant Pedro de Gala did not
intend to recognize the plaintiff as his natural son. On the contrary, it clearly appears
that he had always treated the plaintiff as a son; and his only legitimate son, Generoso,
had also treated the plaintiff as a brother. Generoso certainly would not recognize the
plaintiff as a brother if his father had been in any way reticent about his paternity with
the plaintiff. It is also worthy of notice that the defendant permitted the plaintiff to bear
his (defendant's) surname.
We are fully persuaded that the facts proven in the present case clearly establish the
uninterrupted possession by the plaintiff of the status of a natural son of the defendant
Pedro de Gala. The fact that the plaintiff was not baptized as the natural child of the
defendant is not sufficient to overcome the effect of the subsequent treatment accorded
by the latter to the former, as above indicated. Such a statement in the certificate or
record of baptism, while it would aid in proving the status in question, is not an
indispensable element of such proof. The fact that the plaintiff did not live with the
defendant is explained by the circumstance that the latter shortly after the birth of the
former, married a woman other than the plaintiff's mother; and, it would have been
unreasonable to expect the defendant to introduce to his bride, and ask her to take care
169
of, the fruit of his vice. It does not appear here, as it does in the Urbano case supra,
that the defendant kept other natural children in his house. The fact that the defendant
disowned the plaintiff during the trial of this cause, cannot divest the latter of the right
to recognition, which had theretofore been vested in him. In the case of
Dalistan vs. Armas (32 Phil., 648), the defendant father abandoned and disowned his
natural children after having treated them as such, but that fact did not prevent this
court from compelling him to recognize them.

We are not unmindful of the fact that the law sedulously guards the rights of the
legitimate family against any possible illegal encroachment by an alleged illegitimate
child. But, when as in the present case, the proof is clear and convincing that the said
natural child has been continuously treated as such, not only by the natural father, but
by the members of the legitimate family themselves, we feel that is but a matter of ADDITIONAL CASES
simple justice that the natural father should be required to recognize him as the law
provides, thus extending to him all the rights that, under the law, such recognition may
entail. In this connection Manresa says: "He who is born of an illegitimate union is as
free from fault on his part as the one born of a legitimate union. Yet, from the time of G.R. No. 121027. July 31, 1997.
his birth, he finds himself abandoned, without a family, and at times does not even feel
CORAZON DEZOLLER TISON and RENE R. DEZOLLER, petitioners, vs.
the affection of his parents, who after satisfying their animal instincts usually separate,
COURT OF APPEALS and TEODORA DOMINGO, respondents.
and if they do not attempt against the child's existence, they leave too society the duty
of taking care of the fruit of their crime or offense; and society, although sympathizing Filiation; Parent and Child; Presumptions; There is no presumption of the law more
with him, stamps the mark of infamy and scorn upon the forehead of the unfortunate firmly established and founded on sounder morality and more convincing reason than
illegitimate child." (6 Manresa, 534.) the presumption that children born in wedlock are legitimate.—It seems that both the
court a quo and respondent appellate court have regrettably overlooked the universally
For all of the foregoing reasons, the judgment of the lower court is hereby revoked,
recognized presumption on legitimacy. There is no presumption of the law more firmly
with the costs of this instance against the appellees, and it is hereby ordered and
established and founded on sounder morality and more convincing reason than the
decreed that a judgment be entered, requiring the appellees, Josefa Alabastro and
presumption that children born in wedlock are legitimate. And well settled is the rule
Generoso de Gala, to recognize and acknowledge the appellant, Sinforoso de Gala, as
that the issue of legitimacy cannot be attacked collaterally.
the natural son of the deceased Pedro de Gala. So ordered.
Same; Same; Same; Actions; Actions for Reconveyance; The issue of legitimacy
cannot be properly controverted in an action for reconveyance.—The issue, therefore,
Natural Children, Recognition of.—Held: Under the facts stated in the opinion, as to whether petitioners are the legitimate children of Hermogenes Dezoller cannot be
following the law in force prior to the Civil Code, that the defendant had recognized properly controverted in the present action for reconveyance. This is aside, of course,
the plaintiff as his natural child. De Gala vs. De Gala , 42 Phil., 771, No. 15756 from the further consideration that private respondent is not the proper party to impugn
February 15, 1922 the legitimacy of herein petitioners. The presumption consequently continues to
operate in favor of petitioners unless and until it is rebutted.

Same; Same; Same; Burden of Proof; The burden of proof rests on the party who
disputes the legitimacy of a particular party.—Even assuming that the issue is allowed
to be resolved in this case, the burden of proof rests not on herein petitioners who have
the benefit of the presumption in their favor, but on private respondent who is
disputing the same. This fact alone should have been sufficient cause for the trial court
to exercise appropriate caution before acting, as it did, on the demurrer to evidence. It

170
would have delimited the issues for resolution, as well as the time and effort
necessitated thereby.
Same; Same; Same; Evidence; In order to destroy the presumption of legitimacy, the
party against whom it operates must adduce substantial and credible evidence to the
contrary.—Ordinarily, when a fact is presumed, it implies that the party in whose favor
the presumption exists does not have to introduce evidence to establish that fact, and in
any litigation where that fact is put in issue, the party denying it must bear the burden
of proof to overthrow the presumption. The presumption of legitimacy is so strong that
it is clear that its effect is to shift the burden of persuasion to the party claiming
illegitimacy. And in order to destroy the presumption, the party against whom it
operates must adduce substantial and credible evidence to the contrary.
Same; Same; Same; Same; A presumption is prima facie proof of the fact presumed,
and unless the fact thus established prima facie by the legal presumption of its truth is
disproved, it must stand as proved.—Where there is an entire lack of competent
evidence to the contrary, and unless or until it is rebutted, it has been held that a
presumption may stand in lieu of evidence and support a finding or decision. Perforce,
a presumption must be followed if it is uncontroverted. This is based on the theory that
a presumption is prima facie proof of the fact presumed, and unless the fact thus
established prima facie by the legal presumption of its truth is disproved, it must stand
as proved.
Same; Same; Same; Same; Pleadings and Practice; When a party opts not to present
countervailing evidence to overcome the presumption, by merely filing a demurrer to
evidence instead, he or she in effect impliedly admits the truth of such fact.—
Indubitably, when private respondent opted not to present countervailing evidence to
overcome the presumption, by merely filing a demurrer to evidence instead, she in
effect impliedly admitted the truth of such fact. Indeed, she overlooked or disregarded
the evidential rule that presumptions like judicial notice and admissions, relieve the
proponent from presenting evidence on the facts he alleged and such facts are thereby
considered as duly proved.
Same; Same; Same; Same; Hearsay Rule; Declarations About Pedigree; Conditions for
the admission of declarations about pedigree.—The primary proof to be considered in
ascertaining the relationship between the parties concerned is the testimony of Corazon
Dezoller Tison to the effect that Teodora Dezoller Guerrero in her lifetime, or
sometime in 1946, categorically declared that the former is Teodora’s niece. Such a
statement is considered a declaration about pedigree which is admissible, as an
exception to the hearsay rule, under Section 39, Rule 130 of the Rules of Court, subject
to the following conditions: (1) that the declarant is dead or unable to testify; (2) that
the declarant be related to the person whose pedigree is the subject of inquiry; (3) that
such relationship be shown by evidence other than the declaration; and (4) that the
declaration was made ante litem motam, that is, not only before the commencement of
the suit involving the subject matter of the declaration, but before any controversy has
arisen thereon.
Same; Evidence; Hearsay Rule; Declarations About Pedigree; Where the party
claiming seeks recovery against a relative common to both claimant and declarant—
not from the declarant himself or the declarant’s estate—the relationship of the
declarant to the common relative may not be proved by the declaration itself, but this
requirement does not apply where it is sought to reach the estate of the declarant
himself and not merely to establish a right through his declarations to the property of
some other member of the family.—The general rule, therefore, is that where the party
claiming seeks recovery against a relative common to both claimant and declarant, but
not from the declarant himself or the declarant’s estate, the relationship of the declarant
to the common relative may not be proved by the declaration itself. There must be
some independent proof of this fact. As an exception, the requirement that there be
other proof than the declarations of the declarant as to the relationship, does not apply
where it is sought to reach the estate of the declarant himself and not merely to
establish a right through his declarations to the property of some other member of the
family.
Same; Same; Same; Same; Where a party claims a right to a part of the estate of the
declarant, the declaration of the latter that the former is her niece is admissible and
constitutes sufficient proof of such relationship, notwithstanding the fact that there was
no other preliminary evidence thereof, the reason being that such declaration is
rendered competent by virtue of the necessity of receiving such evidence to avoid a
failure of justice.—We are sufficiently convinced, and so hold, that the present case is
one instance where the general requirement on evidence aliunde may be relaxed.
Petitioners are claiming a right to part of the estate of the declarant herself.
Conformably, the declaration made by Teodora Dezoller Guerrero that petitioner
Corazon is her niece, is admissible and constitutes sufficient proof of such relationship,
notwithstanding the fact that there was no other preliminary evidence thereof, the
reason being that such declaration is rendered competent by virtue of the necessity of
receiving such evidence to avoid a failure of justice. More importantly, there is in the
present case an absolute failure by all and sundry to refute that declaration made by the
decedent.
Same; Same; Same; Same; Where the subject of the declaration is the declarant’s own
relationship to another person, it seems absurd to require, as a foundation for the
admission of the declaration, proof of the very fact which the declaration is offered to
establish.—From the foregoing disquisitions, it may thus be safely concluded, on the
sole basis of the decedent’s declaration and without need for further proof thereof, that
petitioners are the niece and nephew of Teodora Dezoller Guerrero. As held in one
case, where the subject of the declaration is the declarant’s own relationship to another
person, it seems absurd to require, as a foundation for the admission of the declaration,
171
proof of the very fact which the declaration is offered to establish. The preliminary
proof would render the main evidence unnecessary.
Same; Same; Same; Pleadings and Practice; It is elementary that an objection shall be
made at the time when an alleged inadmissible document is offered in evidence,
otherwise, the objection shall be treated as waived.—Applying the general rule in the
present case would nonetheless produce the same result. For while the documentary
evidence submitted by petitioners do not strictly conform to the rules on their
admissibility, we are however of the considered opinion that the same may be admitted
by reason of private respondent’s failure to interpose any timely objection thereto at
the time they were being offered in evidence. It is elementary that an objection shall be
made at the time when an alleged inadmissible document is offered in evidence,
otherwise, the objection shall be treated as waived, since the right to object is merely a
privilege which the party may waive.
Same; Same; Same; Same; Even if certain documents are inadmissible for being
hearsay, but on account of a party’s failure to object thereto, the same may be admitted
and considered as sufficient to prove the facts therein asserted.—The situation is
aggravated by the fact that counsel for private respondent unreservedly cross-examined
petitioners, as the lone witness, on the documentary evidence that were offered. At no
time was the issue of the supposed inadmissibility thereof, or the possible basis for
objection thereto, ever raised. Instead, private respondent’s counsel elicited answers
from the witness on the circumstances and regularity of her obtention of said
documents: The observations later made by private respondent in her comment to
petitioners’ offer of exhibits, although the grounds therefor were already apparent at
the time these documents were being adduced in evidence during the testimony of
Corazon Dezoller Tison but which objections were not timely raised therein, may no
longer serve to rectify the legal consequences which resulted therefrom. Hence, even
assuming ex gratia argumenti that these documents are inadmissible for being hearsay,
but on account of herein private respondent’s failure to object thereto, the same may be
admitted and considered as sufficient to prove the facts therein asserted.
Succession; Where a decedent is survived by the spouse and nephews and nieces, the
former shall be entitled to one-half of the inheritance and the nephews and nieces to
the other half.—Upon the death of Teodora Dezoller Guerrero, one-half of the subject
property was automatically reserved to the surviving spouse, Martin Guerrero, as his
share in the conjugal partnership. Applying the aforequoted statutory provisions, the
remaining half shall be equally divided between the widower and herein petitioners
who are entitled to jointly inherit in their own right. Hence, Martin Guerrero could
only validly alienate his total undivided three-fourths (3/4) share in the entire property
to herein private respondent. Resultantly, petitioners and private respondent are
deemed co-owners of the property covered by Transfer Certificate of Title No. 374012
in the proportion of an undivided one-fourth (1/4) and three-fourths (3/4) share thereof,
respectively.
Actions; Pleadings and Practice; Demurrer to Evidence; If a demurrer to evidence is
granted but on appeal the order of dismissal is reversed, the movant shall be deemed to
have waived the right to present evidence.—All told, on the basis of the foregoing
considerations, the demurrer to plaintiffs’ evidence should have been, as it is hereby,
denied. Nonetheless, private respondent may no longer be allowed to present evidence
by reason of the mandate under Section 1 of revised Rule 3 of the Rules of Court
which provides that “if the motion is granted but on appeal the order of dismissal is
reversed he shall be deemed to have waived the right to present evidence.” Tison vs.
Court of Appeals, 276 SCRA 582, G.R. No. 121027 July 31, 1997
The present appeal by certiorari seeks the reversal of the judgment rendered by
respondent Court of Appeals on June 30, 1995 1 which affirmed the Order of December
3, 1992 issued by the Regional Trial Court of Quezon City, Branch 98, granting herein
private respondent's Demurrer to Plaintiff's Evidence filed in Civil Case No. Q-88-
1054 pending therein.
The present appellate review involves an action for reconveyance filed by herein
petitioners against herein private respondent before the Regional Trial Court of
Quezon City, Branch 98, docketed as the aforesaid Civil Case No. Q-88-1054, over a
parcel of land with a house and apartment thereon located at San Francisco del Monte,
Quezon City and which was originally owned by the spouses Martin Guerrero and
Teodora Dezoller Guerrero. It appears that petitioners Corazon Tison and Rene
Dezoller are the niece and nephew, respectively, of the deceased Teodora Dezoller
Guerrero who is the sister of petitioner's father, Hermogenes Dezoller. Teodora
Dezoller Guerrero died on March 5, 1983 without any ascendant or descendant, and
was survived only by her husband, Martin Guerrero, and herein petitioners. Petitioners'
father, Hermogenes, died on October 3, 1973, hence they seek to inherit from Teodora
Dezoller Guerrero by right of representation.
The records reveal that upon the death of Teodora Dezoller Guerrero, her surviving
spouse, Martin, executed on September 15, 1986 an Affidavit of Extrajudicial
Settlement2 adjudicating unto himself, allegedly as sole heir, the land in dispute which
is covered by Transfer Certificate of Title No. 66886, as a consequence of which
Transfer Certificate of Title No. 358074 was issued in the name of Martin Guerrero.
On January 2, 1988, Martin Guerrero sold the lot to herein private respondent Teodora
Domingo and thereafter, Transfer Certificate of Title No. 374012 was issued in the
latter's name.
Martin Guerrero died on October 25, 1988. Subsequently, herein petitioners filed an
action for reconveyance on November 2, 1988, claiming that they are entitled to inherit
one-half of the property in question by right of representation.
172
At the pre-trial conference, the following issues were presented by both parties for
resolution:
(1) whether or not the plaintiffs (herein petitioners) are the nephew and niece
of the late Teodora Dezoller;
(2) whether or not the plaintiffs are entitled to inherit by right of
representation from the estate of the late Teodora Dezoller;
(3) whether or not defendant (herein private respondent) must reconvey the
reserved participation of the plaintiffs to the estate of the late Teodora
Dezoller under Section 4, Rule 74 of the Rules of Court which was duly
annotated on the title of the defendant;
(4) whether or not the plaintiffs are entitled to damages, moral and exemplary,
plus attorney's fees for the willful and malicious refusal of defendant to
reconvey the participation of plaintiffs in the estate of Teodora Dezoller,
despite demands and knowing fully well that plaintiffs are the niece and
nephew of said deceased; and
(5) whether or not the subject property now in litigation can be considered as
conjugal property of the spouses Martin Guerrero and Teodora Dezoller
Guerrero.3
During the hearing, petitioner Corazon Dezoller Tison was presented as the lone
witness, with the following documentary evidence offered to prove petitioners' filiation
to their father and their aunt, to wit: a family picture; baptismal certificates of Teodora
and Hermogenes Dezoller; certificates of destroyed records of birth of Teodora
Dezoller and Hermogenes Dezoller; death certificates of Hermogenes Dezoller and
Teodora Dezoller Guerrero; certification of destroyed records of live birth of Corazon
and Rene Dezoller; joint affidavits of Pablo Verzosa and Meliton Sitjar attesting to the
parents, date and place of birth of Corazon and Rene Dezoller; joint affidavit of Juliana
Cariaga and Manuela Cariaga attesting to the fact of marriage between Martin
Guerrero and Teodora Dezoller; and the marriage certificate of Martin and Teodora
Guerrero.4 Petitioners thereafter rested their case and submitted a written offer of these
exhibits to which a Comment5 was filed by herein private respondent.
Subsequently, private respondent filed a Demurrer to Plaintiff's Evidence on the
ground that petitioners failed to prove their legitimate filiation with the deceased
Teodora Guerrero in accordance with Article 172 of the Family Code. It is further
averred that the testimony of petitioner Corazon Dezoller Tison regarding her
relationship with her alleged father and aunt is self-serving, uncorroborated and
incompetent, and that it falls short of the quantum of proof required under Article 172
of the Family Code to establish filiation. Also, the certification issued by the Office of
the Local Civil Registrar of Himamaylan, Negros Occidental is merely proof of the
alleged destruction of the records referred to therein, and the joint affidavit executed by
Pablo Verzosa and Meliton Sitjar certifying to the date, place of birth and parentage of
herein petitioners is inadmissible for being hearsay since the affiants were never
presented for cross-examination.6
On December 3, 1992, the trial court issued an order granting the demurrer to evidence
and dismissing the complaint for reconveyance. 7
In upholding the dismissal, respondent Court of Appeals declared that the documentary
evidence presented by herein petitioners, such as the baptismal certificates, family
picture, and joint affidavits are all inadmissible and insufficient to prove and establish
filiation. Hence, this appeal.
We find for petitioners.
The bone of contention in private respondent's demurrer to evidence is whether or not
herein petitioners failed to meet the quantum of proof required by Article 172 of the
Family Code to establish legitimacy and filiation. There are two points for
consideration before us: first is the issue on petitioner's legitimacy, and second is the
question regarding their filiation with Teodora Dezoller Guerrero.
I.
It is not debatable that the documentary evidence adduced by petitioners, taken
separately and independently of each other, are not per se sufficient proof of
legitimacy nor even of pedigree. It is important to note, however, that the rulings of
both lower courts in the case are basically premised on the erroneous assumption that,
in the first place, the issue of legitimacy may be validly controverted in an action for
reconveyance, and, in the second place, that herein petitioners have the onus
probandi to prove their legitimacy and, corollarily, their filiation. We disagree on both
counts.
It seems that both the court a quo and respondent appellate court have regrettably
overlooked the universally recognized presumption on legitimacy. There is no
presumption of the law more firmly established and founded on sounder morality and
more convincing reason than the presumption that children born in wedlock are
legitimate.8 And well settled is the rule that the issue of legitimacy cannot be attacked
collaterally.
The rationale for these rules has been explained in this wise:
The presumption of legitimacy in the Family Code . . . actually fixes a civil status for
the child born in wedlock, and that civil status cannot be attacked collaterally. The
legitimacy of the child can be impugned only in a direct action brought for that
purpose, by the proper parties, and within the period limited by law.
173
The legitimacy of the child cannot be contested by way of defense or as a collateral
issue in another action for a different purpose. The necessity of an independent action
directly impugning the legitimacy is more clearly expressed in the Mexican Code
(Article 335) which provides: "The contest of the legitimacy of a child by the husband
or his heirs must be made by proper complaint before the competent court; any contest
made in any other way is void." This principle applies under our Family Code. Articles
170 and 171 of the code confirm this view, because they refer to "the action to impugn
the legitimacy." This action can be brought only by the husband or his heirs and within
the periods fixed in the present articles.
Upon the expiration of the periods provided in Article 170, the action to impugn the
legitimacy of a child can no longer be brought. The status conferred by the
presumption, therefore, becomes fixed, and can no longer be questioned. The obvious
intention of the law is to prevent the status of a child born in wedlock from being in a
state of uncertainty for a long time. It also aims to force early action to settle any doubt
as to the paternity of such child, so that the evidence material to the matter, which must
necessarily be facts occurring during the period of the conception of the child, may still
be easily available.
xxx xxx xxx
Only the husband can contest the legitimacy of a child born to his wife. He is the one
directly confronted with the scandal and ridicule which the infidelity of his wife
produces; and he should decide whether to conceal that infidelity or expose it, in view
of the moral and economic interest involved. It is only in exceptional cases that his heir
are allowed to contest such legitimacy. Outside of these cases, none — even his heirs
— can impugn legitimacy; that would amount to an insult to his memory. 9
The issue, therefore, as to whether petitioners are the legitimate children of
Hermogenes Dezoller cannot be properly controverted in the present action for
reconveyance. This is aside, of course, from the further consideration that private
respondent is not the proper party to impugn the legitimacy of herein petitioners. The
presumption consequently continues to operate in favor of petitioners unless and until
it is rebutted.
Even assuming that the issue is allowed to be resolved in this case, the burden of proof
rests not on herein petitioners who have the benefit of the presumption in their favor,
but on private respondent who is disputing the same. This fact alone should have been
sufficient cause for the trial court to exercise appropriate caution before acting, as it
did, on the demurrer to evidence. It would have delimited the issues for resolution, as
well as the time and effort necessitated thereby.
Ordinarily, when a fact is presumed, it implies that the party in whose favor the
presumption exists does not have to introduce evidence to establish that fact, and in
any litigation where that fact is put in issue, the party denying it must bear the burden
of proof to overthrow the presumption. 10 The presumption of legitimacy is so strong
that it is clear that its effect is to shift the burden of persuasion to the party claiming
illegitimacy. 11 And in order to destroy the presumption, the party against whom it
operates must adduce substantial and credible evidence to the contrary.12
Where there is an entire lack of competent evidence to the contrary, 13 and unless or
until it is rebutted, it has been held that a presumption may stand in lieu of evidence
and support a finding or decision. 14 Perforce, a presumption must be followed if it is
uncontroverted. This is based on the theory that a presumption is prima facie proof of
the fact presumed, and unless the fact thus established prima facie by the legal
presumption of its truth is disproved, it must stand as proved. 15
Indubitably, when private respondent opted not to present countervailing evidence to
overcome the presumption, by merely filing a demurrer to evidence instead, she in
effect impliedly admitted the truth of such fact. Indeed, she overlooked or disregarded
the evidential rule that presumptions like judicial notice and admissions, relieve the
proponent from presenting evidence on the facts he alleged and such facts are thereby
considered as duly proved.
II.
The weight and sufficiency of the evidence regarding petitioner's relationship with
Teodora Dezoller Guerrero, whose estate is the subject of the present controversy,
requires a more intensive and extensive examination.
Petitioners' evidence, as earlier explained, consists mainly of the testimony of Corazon
Dezoller Tison, the baptismal, death and marriage certificates, the various
certifications from the civil registrar, a family picture, and several joint affidavits
executed by third persons all of which she identified and explained in the course and as
part of her testimony.
The primary proof to be considered in ascertaining the relationship between the parties
concerned is the testimony of Corazon Dezoller Tison to the effect that Teodora
Dezoller Guerrero in her lifetime, or sometime in 1946, categorically declared that the
former is Teodora's niece. 16 Such a statement is considered a declaration about
pedigree which is admissible, as an exception to the hearsay rule, under Section 39,
Rule 130 of the Rules of Court, subject to the following conditions: (1) that the
declarant is dead or unable to testify; (2) that the declarant be related to the person
whose pedigree is the subject of inquiry; (3) that such relationship be shown by
evidence other than the declaration; and (4) that the declaration was made ante litem
motam, that is, not only before the commencement of the suit involving the subject
matter of the declaration, but before any controversy has arisen thereon.
174
There is no dispute with respect to the first, second and fourth elements. What remains
for analysis is the third element, that is, whether or not the other documents offered in
evidence sufficiently corroborated the declaration made by Teodora Dezoller Guerrero
in her lifetime regarding the pedigree of petitioner Corazon Dezoller Tison or, if at all,
it is necessary to present evidence other than such declaration.
American jurisdiction has it that a distinction must be made as to when the relationship
of the declarant may be proved by the very declaration itself, or by other declarations
of said declarant, and when it must be supported by evidence aliunde. The rule is
stated thus:
One situation to be noted is that where one seeks to set up a claim through, but not
from, the declarant and to establish the admissibility of a declaration regarding
claimant's pedigree, he may not do by declarant's own statements as to declarant's
relationship to the particular family. The reason is that declarant's declaration of his
own relationship is of a self-serving nature. Accordingly there must be precedent proof
from other sources that declarant is what he claimed to be, namely, a member of the
particular family; otherwise the requirement to admissibility that declarant's
relationship to the common family must appear is not met. But when the party
claiming seeks to establish relationship in order to claim directly from the declarant or
the declarant's estate, the situation and the policy of the law applicable are quite
different. In such case the declaration of the decedent, whose estate is in controversy,
that he was related to the one who claims his estate, is admissible without other proof
of the fact of relationship. While the nature of the declaration is then disserving, that is
not the real ground for its admission. Such declarations do not derive their evidential
value from that consideration, although it is a useful, if not an artificial, aid in
determining the class to which the declarations belong. The distinction we have note is
sufficiently apparent; in the one case the declarations are self-serving, in the other they
are competent from reasons of necessity. 17(Emphasis ours.)
The general rule, therefore, is that where the party claiming seeks recovery against a
relative common to both claimant and declarant, but not from the declarant himself or
the declarant's estate, the relationship of the declarant to the common relative may not
be proved by the declaration itself. There must be some independent proof of this
fact. 18 As an exception, the requirement that there be other proof than the declarations
of the declarant as to the relationship, does not apply where it is sought to reach the
estate of the declarant himself and not merely to establish a right through his
declarations to the property of some other member of the family. 19
We are sufficiently convinced, and so hold, that the present case is one instance where
the general requirement on evidence aliunde may be relaxed. Petitioners are claiming a
right to part of the estate of the declarant herself. Conformably, the declaration made
by Teodora Dezoller Guerrero that petitioner Corazon is her niece, is admissible and
constitutes sufficient proof of such relationship, notwithstanding the fact that there was
no other preliminary evidence thereof, the reason being such declaration is rendered
competent by virtue of the necessity of receiving such evidence to avoid a failure of
justice. 20 More importantly, there is in the present case an absolute failure by all and
sundry to refute that declaration made by the decedent.
From the foregoing disquisitions, it may thus be safely concluded, on the sole basis of
the decedent's declaration and without need for further proof thereof, that petitioners
are the niece and nephew of Teodora Dezoller Guerrero. As held in one case, 21 where
the subject of the declaration is the declarant's own relationship to another person, it
seems absurb to require, as a foundation for the admission of the declaration, proof of
the very fact which the declaration is offered to establish. The preliminary proof would
render the main evidence unnecessary.
Applying the general rule in the present case would nonetheless produce the same
result. For while the documentary evidence submitted by petitioners do not strictly
conform to the rules on their admissibility, we are however of the considered opinion
that the same may be admitted by reason of private respondent's failure to interpose
any timely objection thereto at the time they were being offered in evidence.  22 It is
elementary that an objection shall
be made at the time when an alleged inadmissible document is offered in
evidence, 23otherwise, the objection shall be treated as waived, 24 since the right to
object is merely a privilege which the party may waive. 25
As explained in Abrenica vs. Gonda, et al., 26 it has been repeatedly laid down as a rule
of evidence that a protest or objection against the admission of any evidence must be
made at the proper time, otherwise it will be deemed to have been waived. The proper
time is when from the question addressed to the witness, or from the answer thereto, or
from the presentation of the proof, the inadmissibility of the evidence is, or may be
inferred.
Thus, a failure to except to the evidence because it does not conform with the statute is
a waiver if the provisions of the law. That objection to a question put to a witness must
be made at the time the question is asked. An objection to the admission of evidence
on the ground of incompetency, taken after the testimony has been given, is too
late. 27 Thus, for instance, failure to object to parol evidence given on the stand, where
the party is in a position to object, is a waiver of any objections thereto. 28
The situation is aggravated by the fact that counsel for private respondent
unreservedly cross-examined petitioners, as the lone witness, on the documentary
evidence that were offered. At no time was the issue of the supposed inadmissibility
thereof, or the possible basis for objection thereto, ever raised. Instead, private
respondent's counsel elicited answers from the witness on the circumstances and
regularity of her obtention of said documents: The observations later made by private
respondent in her comment to petitioners' offer of exhibits, although the grounds
175
therefor were already apparent at the time these documents were being adduced in
evidence during the testimony of Corazon Dezoller Tison but which objections were
not timely raised therein, may no longer serve to rectify the legal consequences which
resulted therefrom. Hence, even assuming ex gratia argumenti that these documents
are inadmissible for being hearsay, but on account of herein private respondent's
failure to object thereto, the same may be admitted and considered as sufficient to
prove the facts therein asserted. 29
Accordingly, the Certificate of Marriage (Exhibit S) wherein it is indicated that the
parents of Teodora Dezoller are Isabelo Dezoller and Cecilia Calpo, as well as the
Certificates of Baptism of Teodora Dezoller 30 (Exhibit H) and Hermogenes Dezoller
(Exhibit J) which both reflect the names of their parents as Isabelo Dezoller and
Cecilia Calpo, to show that Hermogenes Dezoller is the brother of Teodora Dezoller
Guerrero; and the Death Certificate of Hermogenes Dezoller (Exhibit K) the entries
wherein were made by petitioner Corazon Dezoller Tison as his daughter, together
with the Joint Affidavits of Pablo Verzosa and Meliton Sitjar (Exhibits N and P), to
prove that herein petitioners are the children of Hermogenes Dezoller — these can be
deemed to have sufficiently established the relationship between the declarant and
herein petitioners. This is in consonance with the rule that a prima facie showing is
sufficient and that only slight proof of the relationship is required. 31 Finally, it may not
be amiss to consider as in the nature of circumstantial evidence the fact that both the
declarant and the claimants, who are the subject of the declaration, bear the surname
Dezoller. 32
III.
The following provisions of the Civil Code provide for the manner by which the estate
of the decedent shall be divided in this case, to wit:
Art. 975. When children of one or more brothers or sisters of the deceased survive,
they shall inherit from the latter by representation, if they survive with their uncles or
aunts. But if they alone survive, they shall inherit in equal portions.
shall be equally divided between the widower and herein petitioners who are entitled to
jointly inherit in their own right. Hence, Martin Guerrero could only validly alienate
his total undivided three-fourths (3/4) share in the entire property to herein private
respondent. Resultantly, petitioners and private respondent are deemed co-owners of
the property covered by Transfer Certificate of Title No. 374012 in the proportion of
an undivided one-fourth (1/4) and three-fourths (3/4) share thereof, respectively.
All told, on the basis of the foregoing considerations, the demurrer to plaintiff's
evidence should have been, as it is hereby, denied. Nonetheless, private respondent
may no longer be allowed to present evidence by reason of the mandate under Section
1 of revised Rule 3 of the Rules of Court which provides that "if the motion is granted
but on appeal the order of dismissal is reversed he shall be deemed to have waived the
right to present evidence." 33
WHEREFORE, the questioned judgment of respondent Court of Appeals is hereby
REVERSED and SET ASIDE, and herein petitioners and private respondent are
declared co-owners of the subject property with an undivided one-fourth (1/4) and
three-fourths (3/4) share therein, respectively.
SO ORDERED.
Notes.—Hearsay evidence alone may be insufficient to establish a fact in an injunction
suit but, when no objection is made thereto, it is, like any other evidence, to be
considered and given the importance it deserves. (Top-Weld Manufacturing, Inc. vs.
ECED, S.A., 138 SCRA 118 [1985])
Photographs of a person at baptism and in the house do not prove that he is the father.
(Fernandez vs. Court of Appeals, 230 SCRA 130 [1994]) Tison vs. Court of Appeals,
276 SCRA 582, G.R. No. 121027 July 31, 1997

Art. 995. In the absence of legitimate descendants and ascendants, and illegitimate
children and their descendants, whether legitimate or illegitimate, the surviving spouse
shall inherit the entire estate, without prejudice to the rights of brothers and sisters,
nephews and nieces, should there be any, under Article 1001.

Art. 1001. Should brothers and sisters or their children survive with the widow or
widower, the latter shall be entitled to one-half of the inheritance and the brothers and
sisters or theirs children to the other half.

Upon the death of Teodora Dezoller Guerrero, one-half of the subject property was
automatically reserved to the surviving spouse, Martin Guerrero, as his share in the
conjugal partnership. Applying the aforequoted statutory provisions, the remaining half
176

G.R. No. 124853. February 24, 1998.
FRANCISCO L. JISON, petitioner, vs. COURT OF APPEALS and MONINA
JISON, respondents.
Courts; Appeals; While it is a general rule that factual issues are not within the
province of the Supreme Court, such rule does not apply where there are conflicting
findings of facts of the trial court and the Court of Appeals.—In issue is whether or not
public respondent Court of Appeals committed reversible error, which, in this instance,
necessitates an inquiry into the facts. While as a general rule, factual issues are not
within the province of this Court, nevertheless, in light of the conflicting findings of
facts of the trial court and the Court of Appeals, this case falls under an exception to
this rule.
Parent and Child; Paternity and Filiation; Family Code; The Family Code has
retroactive effect unless there be impairment of vested rights.—Before addressing the
merits of the controversy, we first dispose of preliminary matters relating to the
applicable law and the guiding principles in paternity suits. As to the former, plainly,
the Family Code of the Philippines (Executive Order No. 209) governs the present
controversy. As correctly cited by the Court of Appeals, Uyguangco served as a
judicial confirmation of Article 256 of the Family Code regarding its retroactive effect
unless there be impairment of vested rights, which does not hold true here, it appearing
that neither the putative parent nor the child has passed away and the former having
actually resisted the latter’s claim below.
Same; Same; Illegitimate Children; Evidence; For the success of an action to establish
illegitimate filiation under the second paragraph of Art. 172 of the Family Code, a
“high standard of proof” is required—specifically, to prove open and continuous
possession of the status of an illegitimate child, there must be evidence of the
manifestation of the permanent intention of the supposed father to consider the child as
his, by continuous and clear manifestations of parental affection and care, which
cannot be attributed to pure charity.—For the success of an action to establish
illegitimate filiation under the second paragraph, which MONINA relies upon given
that she has none of the evidence mentioned in the first paragraph, a “high standard of
proof” is required. Specifically, to prove open and continuous possession of the status
of an illegitimate child, there must be evidence of the manifestation of the permanent
intention of the supposed father to consider the child as his, by continuous and clear
manifestations of parental affection and care, which cannot be attributed to pure
charity. Such acts must be of such a nature that they reveal not only the conviction of
paternity, but also the apparent desire to have and treat the child as such in all relations
in society and in life, not accidentally, but continuously. By “continuous” is meant
uninterrupted and consistent, but does not require any particular length of time.
Same; Same; Evidence; Rationale for the “High Standard of Proof” Requirement in
Filiation Proceedings.—The foregoing standard of proof required to establish one’s
filiation is founded on the principle that an order for recognition and support may
create an unwholesome atmosphere or may be an irritant in the family or lives of the
parties, so that it must be issued only if paternity or filiation is established by clear and
convincing evidence.
Same; Same; Same; Words and Phrases; Quantum of Evidence; The concept of
“preponderance of evidence” refers to evidence which is of greater weight, or more
convincing, that which is offered in opposition to it—at bottom, it means probability of
truth.—The foregoing discussion, however, must be situated within the general rules
on evidence, in light of the burden of proof in civil cases, i.e., preponderance of
evidence, and the shifting of the burden of evidence in such cases. Simply put, he who
alleges the affirmative of the issue has the burden of proof, and upon the plaintiff in a
civil case, the burden of proof never parts. However, in the course of trial in a civil
case, once plaintiff makes out a prima facie case in his favor, the duty or the burden of
evidence shifts to defendant to controvert plaintiff’s prima facie case, otherwise, a
verdict must be returned in favor of plaintiff. Moreover, in civil cases, the party having
the burden of proof must produce a preponderance of evidence thereon, with plaintiff
having to rely on the strength of his own evidence and not upon the weakness of the
defendant’s. The concept of “preponderance of evidence” refers to evidence which is
of greater weight, or more convincing, that which is offered in opposition to it; at
bottom, it means probability of truth.
Same; Same; Same; Unlawful intercourse will not be presumed merely from proof of
an opportunity for such indulgence; Akin to the crime of rape where, on most
instances, the only witnesses to the felony are the participants in the sexual act
themselves, in deciding paternity suits, the issue of whether sexual intercourse actually
occurred inevitably redounds to the victim’s or mother’s word, as against the accused’s
177
or putative father’s protestations.—FRANCISCO’s arguments in support of his first
assigned error deserve scant consideration. While it has been observed that unlawful
intercourse will not be presumed merely from proof of an opportunity for such
indulgence, this does not favor FRANCISCO. Akin to the crime of rape where, in most
instances, the only witnesses to the felony are the participants in the sexual act
themselves, in deciding paternity suits, the issue of whether sexual intercourse actually
occurred inevitably redounds to the victim’s or mother’s word, as against the accused’s
or putative father’s protestations. In the instant case, MONINA’s mother could no
longer testify as to the fact of intercourse, as she had, unfortunately, passed away long
before the institution of the complaint for recognition. But this did not mean that
MONINA could no longer prove her filiation. The fact of her birth and her parentage
may be established by evidence other than the testimony of her mother. The paramount
question then is whether MONINA’s evidence is coherent, logical and natural.
Same; Same; Same; Birth Certificates; Baptismal Certificates; A certificate of live
birth purportedly identifying the putative father is not competent evidence as to the
issue of paternity, when there is no showing that the putative father had a hand in the
preparation of said certificates, and the Local Civil Registrar is devoid of authority to
record the paternity of an illegitimate child upon the information of a third person;
Lack of participation by the putative father in the preparation of the baptismal
certificates and school records renders such documents incompetent to prove paternity,
the former being competent merely to prove the administration of the sacrament of
baptism on the date so specified.—MONINA’s reliance on the certification issued by
the Local Civil Registrar concerning her birth (Exhs. E and F) is clearly misplaced. It
is settled that a certificate of live birth purportedly identifying the putative father is not
competent evidence as to the issue of paternity, when there is no showing that the
putative father had a hand in the preparation of said certificates, and the Local Civil
Registrar is devoid of authority to record the paternity of an illegitimate child upon the
information of a third person. Simply put, if the alleged father did not intervene in the
birth certificate, e.g., supplying the information himself, the inscription of his name by
the mother or doctor or registrar is null and void; the mere certificate by the registrar
without the signature of the father is not proof of voluntary acknowledgment on the
latter’s part. In like manner, FRANCISCO’s lack of participation in the preparation of
the baptismal certificates (Exhs. C and D) and school records (Exhs. Z and AA)
renders these documents incompetent to prove paternity, the former being competent
merely to prove the administration of the sacrament of baptism on the date so
specified. However, despite the inadmissibility of the school records per se to prove
paternity, they may be admitted as part of MONINA’s testimony to corroborate her
claim that FRANCISCO spent for her education.
Same; Same; Same; Same; Same; Where the birth certificate and the baptismal
certificate are per se inadmissible in evidence as proof of filiation, they cannot be
admitted indirectly as circumstantial evidence to prove the same.—We likewise
disagree with the ruling of the Court of Appeals that the certificates issued by the
Local Civil Registrar and the baptismal certificates may be taken as circumstantial
evidence to prove MONINA’s filiation. Since they are per se inadmissible in evidence
as proof of such filiation, they cannot be admitted indirectly as circumstantial evidence
to prove the same.
Same; Same; Same; Evidence of Pedigree; Words and Phrases; “Family Possessions,”
Explained; Statutory Construction; Ejusdem Generis; The enumeration contained in
the second portion of Rule 130, Section 40, in light of the rule of ejusdem generis, is
limited to objects which are commonly known as “family possessions,” or those
articles which represent, in effect, a family’s joint statement of its belief as to the
pedigree of a person.—We hold that the scope of the enumeration contained in the
second portion of this provision, in light of the rule of ejusdem generis, is limited to
objects which are commonly known as “family possessions,” or those articles which
represent, in effect, a family’s joint statement of its belief as to the pedigree of a
person. These have been described as objects “openly exhibited and well known to the
family,” or those “which, if preserved in a family, may be regarded as giving a family
tradition.” Other examples of these objects which are regarded as reflective of a
family’s reputation or tradition regarding pedigree are inscriptions on tombstones,
monuments or coffin plates.
Same; Same; Same; Same; Same; “Common Reputation,” Explained; It is the general
repute, the common reputation in the family, and not the common reputation in
community, that is a material element of evidence going to establish pedigree.—
Plainly then, Exhibits S to V, as private documents not constituting “family
possessions” as discussed above, may not be admitted on the basis of Rule 130,
Section 40. Neither may these exhibits be admitted on the basis of Rule 130, Section
41 regarding common reputation, it having been observed that: [T]he weight of
authority appears to be in favor of the theory that it is the general repute, the common
reputation in the family, and not the common reputation in community, that is a
material element of evidence going to establish pedigree. x x x [Thus] matters of
pedigree may be proved by reputation in the family, and not by reputation in the
neighborhood or vicinity, except where the pedigree in question is marriage which may
be proved by common reputation in the community.
Same; Same; Same; Notarial Law; Quantum of Evidence; The standard to contradict a
notarial document is clear and convincing evidence, i.e., more than merely
preponderant.—Indeed, if MONINA were truly not FRANCISCO’s illegitimate
daughter, it would have been unnecessary for him to have gone to such great lengths in
order that MONINA denounce her filiation. For as clearly established before the trial
court and properly appreciated by the Court of Appeals, MONINA had resigned from
Miller & Cruz five (5) months prior to the execution of the sworn statement in
question, hence negating FRANCISCO’s theory of the need to quash rumors
178
circulating within Miller & Cruz regarding the identity of MONINA’s father. Hence,
coupled with the assessment of the credibility of the testimonial evidence of the parties
discussed above, it is evident that the standard to contradict a notarial document, i.e.,
clear and convincing evidence and more than merely preponderant, has been met by
MONINA.
Same; Same; Same; Denials; Perjurers usually confine themselves to the incidents
immediately related to the principal fact about which they testify, and when asked
about collateral facts by which their truthfulness could be tested, their answers not
infrequently take the stereotyped form of such expressions as “I don’t know” or “I
don’t remember.”—Two (2) glaring points in FRANCISCO’s defense beg to be
addressed: First, that his testimony was comprised of mere denials, rife with bare,
unsubstantiated responses such as “That is not true,” “I do not believe that,” or “None
that I know.” In declining then to lend credence to FRANCISCO’s testimony, we
resort to a guiding principle in adjudging the credibility of a witness and the
truthfulness of his statements, laid down as early as 1921: The experience of courts and
the general observation of humanity teach us that the natural limitations of our
inventive faculties are such that if a witness undertakes to fabricate and deliver in court
a false narrative containing numerous details, he is almost certain to fall into fatal
inconsistencies, to make statements which can be readily refuted, or to expose in his
demeanor the falsity of his message. For this reason it will be found that perjurers
usually confine themselves to the incidents immediately related to the principal fact
about which they testify, and when asked about collateral facts by which their
truthfulness could be tested, their answers not infrequently take the stereotyped form of
such expressions as “I don’t know” or “I don’t remember.”
Laches; Elements; Doctrine of Stale Demands.—The last assigned error concerning
laches likewise fails to convince. The essential elements of laches are: (1) conduct on
the part of the defendant, or of one under whom he claims, giving rise to the situation
of which the complaint seeks a remedy; (2) delay in asserting the complainant’s rights,
the complainant having had knowledge or notice of the defendant’s conduct as having
been afforded an opportunity to institute a suit; (3) lack of knowledge or notice on the
part of the defendant that the complaint would assert the right in which he bases his
suit; and (4) injury or prejudice to the defendant in the event relief is accorded to the
complainant, or the suit is not held barred. The last element is the origin of the doctrine
that stale demands apply only where by reason of the lapse of time it would be
inequitable to allow a party to enforce his legal rights.
Same; Laches is based upon grounds of public policy which requires, for the peace of
society, the discouragement of stale claims, and is principally a question of the
inequity or unfairness of permitting a right or claim to be enforced or asserted.—As
FRANCISCO set up laches as an affirmative defense, it was incumbent upon him to
prove the existence of its elements. However, he only succeeded in showing
MONINA’s delay in asserting her claim, but miserably failed to prove the last element.
In any event, it must be stressed that laches is based upon grounds of public policy
which requires, for the peace of society, the discouragement of stale claims, and is
principally a question of the inequity or unfairness of permitting a right or claim to be
enforced or asserted. There is no absolute rule as to what constitutes laches; each case
is to be determined according to its particular circumstances. The question of laches is
addressed to the sound discretion of the court, and since it is an equitable doctrine, its
application is controlled by equitable considerations. It cannot be worked to defeat
justice or to perpetuate fraud and injustice. Since the instant case involves paternity
and filiation, even if illegitimate, MONINA filed her action well within the period
granted her by a positive provision of law. A denial then of her action on ground of
laches would clearly be inequitable and unjust. Jison vs. Court of Appeals, 286 SCRA
495, G.R. No. 124853 February 24, 1998
This is a petition for review under Rule 45 of the Rules of Court of the 27 April 1995
decision of the Court of Appeals (CA) in CA-G.R. CV No. 32860 1 which reversed the
decision of Branch 24 of the Regional Trial Court (RTC) of Iloilo City in Civil Case
No. 16373.2 The latter dismissed the complaint of private respondent Monina Jison
(hereafter MONINA) for recognition as an illegitimate child of petitioner Francisco
Jison (hereafter FRANCISCO).
In issue is whether or not public respondent Court of Appeals committed reversible
error, which, in this instance, necessitates an inquiry into the facts. While as a general
rule, factual issues are not within the province of this Court, nevertheless, in light of
the conflicting findings of facts of the trial court and the Court of Appeals, this case
falls under an exception to this rule.3cräläwvirtualibräry
In her complaint4 filed with the RTC on 13 March 1985, MONINA alleged that
FRANCISCO had been married to a certain Lilia Lopez Jison since 1940. At the end of
1945 or the start of 1946, however, FRANCISCO impregnated Esperanza F. Amolar
(who was then employed as the nanny of FRANCISCO's daughter, Lourdes). As a
result, MONINA was born on 6 August 1946, in Dingle, Iloilo, and since childhood,
had enjoyed the continuous, implied recognition as an illegitimate child of
FRANCISCO by his acts and that of his family. MONINA further alleged that
FRANCISCO gave her support and spent for her education, such that she obtained a
Master's degree, became a certified public accountant (CPA) and eventually, a Central
Bank examiner. In view of FRANCISCO's refusal to expressly recognize her,
MONINA prayed for a judicial declaration of her illegitimate status and that
FRANCISCO support and treat her as such.
In his answer,5 FRANCISCO alleged that he could not have had sexual relations with
Esperanza Amolar during the period specified in the complaint as she had ceased to be
in his employ as early as 1944, and did not know of her whereabouts since then;
further, he never recognized MONINA, expressly or impliedly, as his illegitimate
179
child. As affirmative and special defenses, FRANCISCO contended that MONINA
had no right or cause of action against him and that her action was barred by estoppel,
laches and/or prescription. He thus prayed for dismissal of the complaint and an award
of damages due to the malicious filing of the complaint.
After MONINA filed her reply,6 pre-trial was conducted where the parties stipulated
on the following issues:
1. Did Francisco Jison have any sexual relation[s] with Esperanza Am[o]lar
about the end of 1945 or the start of 1946?
2. Is Monina Jison the recognized illegitimate daughter of Francisco Jison by
the latters own acts and those of his family?
3. Is Monina Jison barred from instituting or prosecuting the present action by
estoppel, laches and/or prescription?
4. Damages.7
At trial on the merits, MONINA presented a total of eleven (11) witnesses, namely:
herself, Ruben Castellanes, Sr., Adela Casabuena, Arsenio Duatin, Zafiro Ledesma,
Danthea Lopez, Romeo Bilbao, Rudy Tingson, Alfredo Baylosis, Dominador Zavariz
and Lope Amolar.
Ruben Castellanes, Sr., a 63-year old resident of Iloilo City, testified that he had
worked for FRANCISCO for a total of six (6) years at Nelly Garden, FRANCISCO's
Iloilo residence. Towards the end of the Japanese occupation, FRANCISCOs wife
suffered a miscarriage or abortion, thereby depriving FRANCISCO of consortium;
thereafter, FRANCISCOs wife managed a nightclub on the ground floor of Nelly
Garden which operated daily from 6:00 p.m. till 3:00 a.m. of the following day,
thereby allowing FRANCISCO free access to MONINAs mother, Esperanza Amolar,
who was nicknamed Pansay.
Adela Casabuena, a 61-year old farmer, testified that she served as the yaya (nanny) of
Lourdes from July 1946 up to February 1947. Although Pansay had left Nelly Garden
two (2) weeks before Adela started working for the Jisons, Pansay returned sometime
in September 1946, or about one month after she gave birth to MONINA, to ask
FRANCISCO for support. As a result, Pansay and Lilia Jison, FRANCISCO's wife,
quarreled in the living room, and in the course thereof, Pansay claimed that
FRANCISCO was the father of her baby. To which, Lilia replied: I did not tell you to
make that baby so it is your fault. During the quarrel which lasted from 10:30 till 11:00
a.m., FRANCISCO was supposedly inside the house listening.
Arsenio Duatin, a 77-year old retired laborer, testified that from 1947 until 1977, he
worked as FRANCISCOs houseboy at the latters house on 12th Street, Capitol
Subdivision, Bacolod City. Arsenio met MONINA in 1967, when Felipe Lagarto, the
bookkeeper at Nelly Garden, informed Arsenio that MONINA, FRANCISCOs
daughter, would arrive at Bacolod City with a letter of introduction from Lagarto.
Initially, Arsenio identified seven (7) black-and-white photographs (Exhs. X-5 to X-
11) of MONINA,8 and as he paid for the telephone bills, he likewise identified six (6)
telephone cards (Exhs. G to L). Arsenio then declared that when MONINA arrived in
Bacolod City, she introduced herself to him as FRANCISCOs daughter. She stayed at
FRANCISCOs house, but when the latter and his wife would come over, Arsenio
would conceal the presence of MONINA because Mrs. Jison did not like to see her
face. Once, Arsenio hid MONINA in the house of FRANCISCOs sister, Mrs. Luisa
Jison Alano, in Silay City; another time, at the residence of FRANCISCOs cousin,
Mrs. Concha Lopez Cuaycong. Finally, Arsenio declared that the last time he saw
MONINA was when she left for Manila, after having finished her schooling at La Salle
College in Bacolod City.
On re-direct and upon questions by the court, Arsenio disclosed that it was
FRANCISCO who instructed that MONINA be hidden whenever FRANCISCO and
his wife were around; that although FRANCISCO and MONINA saw each other at the
Bacolod house only once, they called each other through long distance; and that
MONINA addressed FRANCISCO as Daddy during their lone meeting at the Bacolod
house and were affectionate to each other. Arsenio likewise declared that MONINA
stayed at FRANCISCO's Bacolod house twice: first for a month, then for about a week
the second time. On both occasions, however, FRANCISCO and his wife were abroad.
Finally, Arsenio recalled that FRANCISCO likewise bade Arsenio to treat MONINA
like his (FRANCISCOs) other daughters.
The testimony of Zafiro Ledesma, a 74-year old banker and former mayor of Iloilo
City, initially touched on how he and his wife were related to FRANCISCO,
FRANCISCO's wife and MONINA. Zafiro first identified Exhibit R, a diagram of the
family trees of the Jison and Lopez families, which showed that former Vice-President
Fernando Lopez was the first cousin of FRANCISCOs wife, then told the court that the
family of Vice-President Lopez treated MONINA very well because she is considered
a relative xxx by reputation, by actual perception. Zafiro likewise identified Exhibits
X-13 to X-18, photographs taken at the 14 April 1985 birthday celebration of Mrs.
Fernando Lopez, which showed MONINA with the former Vice-President and other
members of the Lopez family.
Zafiro further testified that while MONINA lived with Mrs. Cuaycong, the latter paid
for some of MONINAs school needs and even asked MONINA to work in a hospital
owned by Mrs. Cuaycong; and that another first cousin of FRANCISCOs wife, a
certain Remedios Lopez Franco, likewise helped MONINA with her studies and
problems, and even attended MONINAs graduation in 1978 when she obtained a
masteral degree in Business Administration, as evidenced by another photograph (Exh.
X-12). Moreover, upon Remedios recommendation, MONINA was employed as a
180
secretary at Merchant Financing Company, which was managed by a certain Danthea
Lopez, the wife of another first cousin of FRANCISCOs wife, and among whose
directors were Zafiro himself, his wife and Dantheas husband. In closing, Zafiro
identified MONINAs Social Security Record (Exh. W), which was signed by Danthea
as employer and where MONINA designated Remedios as the beneficiary.
Danthea Lopez, a 58-year old housekeeper, declared that FRANCISCO was the first
cousin of her husband, Eusebio D. Lopez; and that she came to know MONINA in the
latter part of 1965 when Remedios Franco recommended MONINA for employment at
Merchant Financing Co., which Danthea managed at that time. Remedios introduced
MONINA to Danthea as being reputedly the daughter of Mr. Frank Jison; and on
several occasions thereafter, Remedios made Danthea and the latters husband
understand that MONINA was reputedly the daughter of [FRANCISCO]. While
MONINA worked at Merchant Financing, Danthea knew that MONINA lived with
Remedios; however, in the latter part of 1966, as Remedios left for Manila and
MONINA was still studying at San Agustin University, Danthea and her husband
invited MONINA to live with them. During MONINAs 6-month stay with them, she
was not charged for board and lodging and was treated as a relative, not a mere
employee, all owing to what Remedios had said regarding MONINAs filiation. As
Danthea understood, MONINA resigned from Merchant Financing as she was called
by Mrs. Cuaycong, a first cousin of Dantheas husband who lived in Bacolod City.
Romeo Bilbao, a 43-year old seaman, testified that he had worked for FRANCISCO
from 1969 up to 1980 at Nelly Garden in various capacities: as a procurement officer,
hacienda overseer and, later, as hacienda administrator. Sometime in May, 1971,
Romeo saw and heard MONINA ask her Daddy (meaning FRANCISCO) for the
money he promised to give her, but FRANCISCO answered that he did not have the
money to give, then told MONINA to go see Mr. Jose Cruz in Bacolod City. Then in
the middle of September that year, FRANCISCO told Romeo to pick up Mr. Cruz at
the Iloilo pier and bring him to the office of Atty. Benjamin Tirol. At said office, Atty.
Tirol, Mr. Cruz and MONINA entered a room while Romeo waited outside. When they
came out, Atty. Tirol had papers for MONINA to sign, but she refused. Atty. Tirol said
that a check would be released to MONINA if she signed the papers, so MONINA
acceded, although Atty. Tirol intended not to give MONINA a copy of the document
she signed. Thereafter, Mr. Cruz gave MONINA a check (Exh. Q), then MONINA
grabbed a copy of the document she signed and ran outside. Romeo then brought Mr.
Cruz to Nelly Garden. As to his motive for testifying, Romeo stated that he wanted to
help MONINA be recognized as FRANCISCOS daughter.
Rudy Tingson, a 45-year old antique dealer, testified that in 1963-1964, he was
employed by FRANCISCOs wife at the Baguio Military Institute in Baguio City; then
in 1965, Rudy worked at FRANCISCOs office at Nelly Garden recording hacienda
expenses, typing vouchers and office papers, and, at times, acting as paymaster for the
haciendas. From the nature of his work, Rudy knew the persons receiving money from
FRANCISCOs office, and clearly remembered that in 1965, as part of his job, Rudy
gave MONINA her allowance from FRANCISCO four (4) times, upon instructions of
a certain Mr. Lagarto to give MONINA P15.00 a month. Rudy likewise recalled that
he first met MONINA in 1965, and that she would go to Nelly Garden whenever
FRANCISCOs wife was not around. On some of these occasions, MONINA would
speak with and address FRANCISCO as Daddy, without objection from FRANCISCO.
In fact, in 1965, Rudy saw FRANCISCO give MONINA money thrice. Rudy further
declared that in April 1965, FRANCISCOs office paid P250.00 to Funeraria Bernal for
the funeral expenses of MONINAs mother. Finally, as to Rudy's motives for testifying,
he told the court that he simply wanted to help bring out the truth and nothing but the
truth, and that MONINAs filiation was common knowledge among the people in the
office at Nelly Garden.
On re-direct, Rudy declared that the moneys given by FRANCISCOs office to
MONINA were not reflected in the books of the office, but were kept in a separate
book, as Mr. Lagarto explained that FRANCISCOs wife and children should not know
[of] this. Rudy further revealed that as to the garden meetings between FRANCISCO
and MONINA, Rudy saw MONINA kiss FRANCISCO on the cheek both upon
arriving and before leaving, and FRANCISCOs reaction upon seeing her was to smile
and say in the Visayan dialect: Kamusta ka iha? (How are you, daughter?); and that
MONINA was free to go inside the house as the household staff knew of her filiation,
and that, sometimes, MONINA would join them for lunch.
Alfredo Baylosis, a 62-year old retired accountant, testified that he worked for
FRANCISCO at Central Santos-Lopez in Iloilo from 1951 up to 1961, then at Nelly
Garden from 1961 until 1972. Alfredo first served FRANCISCO as a bookkeeper, then
when Mr. Lagarto died in 1967 or 1969, Alfredo replaced Mr. Lagarto as office
manager.
Alfredo knew MONINA since 1961 as she used to go to Nelly Garden to claim
her P15.00 monthly allowance given upon FRANCISCOs standing order. Alfredo
further declared that MONINAs filiation was pretty well-known in the office; that he
had seen MONINA and FRANCISCO go from the main building to the office, with
FRANCISCOs arm on MONINAs shoulder; and that the office paid for the burial
expenses of Pansay, but this was not recorded in the books in order to hide it from
FRANCISCOs wife. Alfredo also disclosed that the disbursements for MONINAs
allowance started in 1961 and were recorded in a separate cash book. In 1967, the
allowances ceased when MONINA stopped schooling and was employed in Bacolod
City with Miller, Cruz & Co., which served as FRANCISCOs accountant-auditor.
Once, when Alfredo went to the offices of Miller, Cruz & Co. to see the manager, Mr.
Atienza, and arrange for the preparation of FRANCISCOs income tax return, Alfredo
chanced upon MONINA. When Alfredo asked her how she came to work there, she
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answered that her Daddy, FRANCISCO, recommended her, a fact confirmed by Mr.
Atienza. Alfredo then claimed that Mr. Jose Cruz, a partner at Miller, Cruz & Co., was
the most trusted man of FRANCISCO.
Dominador Savariz, a 55-year old caretaker, testified that he worked as FRANCISCOs
houseboy at Nelly Garden from November 1953 up to 1965. One morning in April
1954, MONINA and her mother Pansay went to Nelly Garden and spoke with
FRANCISCO for about an hour, during which time, Dominador was vacuuming the
carpet about six (6) to seven (7) meters away. Due to the noise of the vacuum cleaner,
FRANCISCO and MONINA spoke in loud voices, thus Dominador overheard their
conversation. As FRANCISCO asked Pansay why they came, Pansay answered that
they came to ask for the sustenance of his child MONINA. FRANCISCO then touched
MONINA's head and asked: How are you Hija?, to which MONINA answered: Good
morning, Daddy. After FRANCISCO told Pansay and MONINA to wait, he pulled
something from his wallet and said to Pansay: I am giving this for the child.
In May 1954, Dominador saw MONINA at Mr. Lagartos office where Dominador was
to get the days expenses, while MONINA was claiming her allowance from Mr.
Diasnes. The next month, Dominador saw MONINA at Nelly Garden and heard in the
office that MONINA was there to get her allowance from her Daddy. In December
1960, Dominador saw MONINA at Nelly Garden, in the room of Don Vicente (father
of FRANCISCOs wife), where she asked for a Christmas gift and she was calling Don
Vicente, Lolo (grandfather). At that time, FRANCISCO and his wife were not around.
Then sometime in 1961, when Dominador went to Mr. Lagartos office to get the
marketing expenses, Dominador saw MONINA once more claiming her allowance.
Dominador further testified that in February 1966, after he had stopped working for
FRANCISCO, Dominador was at Mrs. Francos residence as she recommended him for
employment with her sister, Mrs. Concha Cuaycong. There, he saw MONINA, who
was then about 15 years old, together with Mrs. Francos daughter and son. Mrs. Franco
pointed at MONINA and asked Dominador if he knew who MONINA was.
Dominador answered that MONINA was FRANCISCOs daughter with Pansay, and
then Mrs. Franco remarked that MONINA was staying with her (Mrs. Franco) and that
she was sending MONINA to school at the University of San Agustin.
Lope Amolar, a 50-year old resident of Dingle, Iloilo, and the younger brother of
Esperanza Amolar (Pansay), testified that he worked for FRANCISCO as a houseboy
from March to November 1945 at Nelly Garden. Thereafter, FRANCISCO sent Lope
to work at Elena Apartments in Manila. By November 1945, Pansay was also working
at Elena Apartments, where she revealed to Lope that FRANCISCO impregnated her.
Lope then confronted FRANCISCO, who told Lope dont get hurt and dont cause any
trouble, because I am willing to support your Inday Pansay and my child. Three (3)
days after this confrontation, Lope asked for and received permission from
FRANCISCO to resign because he (Lope) was hurt.
On 21 October 1986, MONINA herself took the witness stand. At that time, she was
40 years old and a Central Bank Examiner. She affirmed that as evidenced by
certifications from the Office of the Local Civil Registrar (Exhs. E and F) and
baptismal certificates (Exhs. C and D), she was born on 6 August 1946 in Barangay
Tabugon, Dingle, Iloilo, to Esperanza Amolar (who passed away on 20 April 1965)
and FRANCISCO.9MONINA first studied at Sagrado where she stayed as a boarder.
While at Sagrado from 1952 until 1955 (up to Grade 4), her father, FRANCISCO, paid
for her tuition fees and other school expenses. She either received the money from
FRANCISCO or from Mr. Lagarto, or saw FRANCISCO give money to her mother, or
Mr. Lagarto would pay Sagrado directly. After Sagrado, MONINA studied in different
schools,10 but FRANCISCO continuously answered for her schooling.
For her college education, MONINA enrolled at the University of Iloilo, but she later
dropped due to an accident which required a week's hospitalization. Although
FRANCISCO paid for part of the hospitalization expenses, her mother shouldered
most of them. In 1963, she enrolled at the University of San Agustin, where she stayed
with Mrs. Franco who paid for MONINA's tuition fees. However, expenses for books,
school supplies, uniforms and the like were shouldered by FRANCISCO. At the start
of each semester, MONINA would show FRANCISCO that she was enrolled, then he
would ask her to canvass prices, then give her the money she needed. After finishing
two (2) semesters at University of San Agustin, as evidenced by her transcript of
records (Exh. Z showing that FRANCISCO was listed as Parent/Guardian [Exh. Z-1]),
she transferred to De Paul College, just in front of Mrs. Francos house, and studied
there for a year. Thereafter, MONINA enrolled at Western Institute of Technology
(WIT), where she obtained a bachelors degree in Commerce in April 1967. During her
senior year, she stayed with Eusebio and Danthea Lopez at Hotel Kahirup, owned by
said couple. She passed the CPA board exams in 1974, and took up an M.B.A. at De
La Salle University as evidenced by her transcript (Exh. AA), wherein FRANCISCO
was likewise listed as Guardian (Exhs. AA-1 and AA-2).
MONINA enumerated the different members of the household staff at Nelly Garden, to
wit: Luz, the household cook; the houseboys Silvestre and Doming; the housemaid
Natang; the yaya of the adopted triplets, Deling; the yaya of Lolo Vicente, Adelina;
and others. MONINA likewise enumerated the members of the office staff (Messrs.
Baylosis, Lagarto, Tingson, Diasnes, Jalandoni, Supertisioso, Doroy, and others), and
identified them from a photograph marked as Exhibit X-2. She then corroborated the
prior testimony regarding her employment at Merchant Financing Co., and her having
lived at Hotel Kahirup and at Mrs. Cuaycongs residence in Bacolod City, while
working at the hospital owned by Mrs. Cuaycong.
MONINA further testified that in March 1968, she went to Manila and met
FRANCISCO at Elena Apartments at the corner of Romero and Salas Streets, Ermita.
She told FRANCISCO that she was going for a vacation in Baguio City with Mrs.
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Francos mother, with whom she stayed up to June 1968. Upon her return from Baguio
City, MONINA told FRANCISCO that she wanted to work, so the latter arranged for
her employment at Miller & Cruz in Bacolod City. MONINA went to Bacolod City,
was interviewed by Mr. Jose Cruz, a partner at Miller & Cruz, who told her she would
start working first week of September, sans examination. She resigned from Miller &
Cruz in 1971 and lived with Mrs. Cuaycong at her Forbes Park residence in Makati.
MONINA went to see FRANCISCO, told him that she resigned and asked him for
money to go to Spain, but FRANCISCO refused as she could not speak Spanish and
would not be able find a job. The two quarreled and FRANCISCO ordered a helper to
send MONINA out of the house. In the process, MONINA broke many glasses at the
pantry and cut her hand, after which, FRANCISCO hugged her, gave her medicine,
calmed her down, asked her to return to Bacolod City and promised that he would give
her the money.
MONINA returned to Bacolod City by plane, using a Filipinas Orient Airways plane
ticket (Exh. M) which FRANCISCO gave. She called Mr. Cruz, then Atty. Tirol, as
instructed by Mr. Cruz. These calls were evidenced by PLDT long distance toll cards
(Exhs. G to L), with annotations at the back reading: charged and paid under the name
of Frank L. Jison and were signed by Arsenio Duatin (Exhs. G-1 to L-1). PLDT issued
a certification as to the veracity of the contents of the toll cards (Exh. BB). Likewise
introduced in evidence was a letter of introduction prepared by Mr. Cruz addressed to
Atty. Tirol, on MONINA's behalf (Exh. N).
MONINA also declared that Atty. Tirol then told her that she would have to go to
Iloilo and sign a certain affidavit, before Mr. Cruz would turn over the money
promised by FRANCISCO. She went to Atty. Tirols office in Iloilo, but after going
over the draft of the affidavit, refused to sign it as it stated that she was not
FRANCISCOs daughter. She explained that all she had agreed with FRANCISCO was
that he would pay for her fare to go abroad, and that since she was a little girl, she
knew about her illegitimacy. She started crying, begged Atty. Tirol to change the
affidavit, to which Atty. Tirol responded that he was also a father and did not want this
to happen to his children as they could not be blamed for being brought into the world.
She then wrote a letter (Exh. O) to FRANCISCO and sent it to the latters Forbes Park
residence (Bauhinia Place) by JRS courier service (Exhs. O-5 to O-7). MONINA
subsequently met FRANCISCO in Bacolod City where they discussed the affidavit
which she refused to sign. FRANCISCO told her that the affidavit was for his wife,
that in case she heard about MONINA going abroad, the affidavit would keep her
peace.
MONINA then narrated that the first time she went to Atty. Tirols office, she was
accompanied by one Atty. Fernando Divinagracia, who advised her that the affidavit
(Exh. P)11 would boomerang against FRANCISCO as it is contrary to law. MONINA
returned to Bacolod City, then met with Atty. Tirol once more to reiterate her plea, but
Atty. Tirol did not relent. Thus, on the morning of 20 or 21 September 1971, she
signed the affidavit as she was jobless and needed the money to support herself and
finish her studies. In exchange for signing the document, MONINA received a Bank of
Asia check for P15,000.00 (Exh. Q), which was less than the P25,000.00 which
FRANCISCO allegedly promised to give. As Atty. Tirol seemed hesitant to give her a
copy of the affidavit after notarizing it, MONINA merely grabbed a copy and
immediately left.
MONINA then prepared to travel abroad, for which purpose, she procured letters of
introduction (Exhs. S and T) from a cousin, Mike Alano (son of FRANCISCOs elder
sister Luisa); and an uncle, Emilio Jison (FRANCISCOs elder brother), addressed to
another cousin, Beth Jison (Emilios daughter), for Beth to assist MONINA. Exhibit S
contained a statement (Exh. S-1) expressly recognizing that MONINA was
FRANCISCOs daughter. Ultimately though, MONINA decided not to go abroad,
opting instead to spend the proceeds of the P15,000.00 check for her CPA review,
board exam and graduate studies. After finishing her graduate studies, she again
planned to travel abroad, for which reason, she obtained a letter of introduction from
former Vice President Fernando Lopez addressed to then United States Consul Vernon
McAnnich (Exh. V).
As to other acts tending to show her filiation, MONINA related that on one occasion,
as FRANCISCOs wife was going to arrive at the latters Bacolod City residence,
FRANCISCO called Arsenio Duatin and instructed Arsenio to hide MONINA. Thus,
MONINA stayed with Mrs. Luisa Jison for the duration of the stay of FRANCISCOs
wife. MONINA also claimed that she knew Vice President Fernando Lopez and his
wife, Mariquit, even before starting to go to school. Thus, MONINA asked for a
recommendation letter (Exh. U) from Mrs. Mariquit Lopez for possible employment
with Mrs. Rosario Lopez Cooper, another second cousin of FRANCISCO. In Exhibit
U, Mrs. Lopez expressly recognized MONINA as FRANCISCOs daughter. As
additional proof of her close relationship with the family of Vice President Lopez,
MONINA identified photographs taken at a birthday celebration on 14 April 1985.
MONINA finally claimed that she knew the three (3) children of FRANCISCO by
wife, namely, Lourdes, Francisco, Jr. (Junior) and Elena, but MONINA had met only
Lourdes and Junior. MONINA's testimony dealt lengthily on her dealings with Junior
and the two (2) occasions when she met with Lourdes. The last time MONINA saw
FRANCISCO was in March 1979, when she sought his blessings to get married.
In his defense, FRANCISCO offered his deposition taken before then Judge Romeo
Callejo of the Regional Trial Court of Manila, Branch 48. As additional witnesses,
FRANCISCO presented Nonito Jalandoni, Teodoro Zulla, Iigo Supertisioso, Lourdes
Ledesma, Jose Cruz and Dolores Argenal.
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FRANCISCO declared that Pansays employment ceased as of October, 1944, and that
while employed by him, Pansay would sleep with the other female helpers on the first
floor of his residence, while he, his wife and daughter slept in a room on the second
floor. At that time, his household staff was composed of three (3) female workers and
two (2) male workers. After Pansayleft in October 1944, she never communicated with
him again, neither did he know of her whereabouts. FRANCISCO staunchly denied
having had sexual relations with Pansay and disavowed any knowledge about
MONINAs birth. In the same vein, he denied having paid for MONINAs tuition fees,
in person or otherwise, and asserted that he never knew that Mr. Lagarto paid for these
fees. Moreover, FRANCISCO could not believe that Lagarto would pay for these fees
despite absence of instructions or approval from FRANCISCO. He likewise
categorically denied that he told anyone, be it Danthea Lopez, Zafiro Ledesma, Concha
Cuaycong or Remedios Franco, that MONINA was his daughter.
FRANCISCO also disclosed that upon his return from the United States in 1971, he
fired Alfredo Baylosis upon discovering that Alfredo had taken advantage of his
position during the formers absence. FRANCISCO likewise fired Rudy Tingson and
Romeo Bilbao, but did not give the reasons therefor.
Finally, FRANCISCO denied knowledge of MONINAs long distance calls from his
Bacolod residence; nevertheless, when he subsequently discovered this, he fired certain
people in his office for their failure to report this anomaly. As regards the caretaker of
his Bacolod residence, FRANCISCO explained that since MONINA lived at Mrs.
Cuaycongs residence, the caretaker thought that he could allow people who lived at the
Cuaycong residence to use the facilities at his (FRANCISCOs) house.
Nonito Jalandoni, bookkeeper and paymaster at Nellys Garden from 1963 up to 1974,
then from 1980 up to 1986, the assistant overseer of Hacienda Lopez, testified that he
did not know MONINA; that he learned of her only in June 1988, when he was
informed by FRANCISCO that MONINA had sued him; and that he never saw
MONINA at Nellys Garden, neither did he know of any instructions for anyone at
Nellys Garden to give money to MONINA.
Teodoro Zulla, FRANCISCOs bookkeeper and paymaster from 1951 up to 1986,
testified that FRANCISCO dismissed Alfredo Baylosis due to certain unspecified
discrepancies; and that he never saw MONINA receive funds from either Mr. Lagarto
or Mr. Baylosis. Upon questions from the trial court, however, Teodoro admitted that
he prepared vouchers for only one of FRANCISCOs haciendas, and not vouchers
pertaining to the latters personal expenses.
Iigo Supertisioso testified that he worked for FRANCISCO at Nellys Garden from
1964 up to 1984 as a field inspector, paymaster, cashier and, eventually, officer-in-
charge (OIC). He confirmed Alfredo Baylosis dismissal due to these unspecified
irregularities, then denied that FRANCISCO ever ordered that MONINA be given her
allowance. Likewise, Iigo never heard FRANCISCO mention that MONINA was his
(FRANCISCOs) daughter.
Lourdes Ledesma, FRANCISCOs daughter, testified that she saw (but did not know)
MONINA at the Our Lady of Mercy Hospital, on the occasion of the birth of Lourdes
first son, Mark. Over lunch one day, Lourdes aunt casually introduced Lourdes and
MONINA to each other, but they were referred to only by their first names. Then
sometime in 1983 or 1984, MONINA allegedly went to Lourdes house in Sta. Clara
Subdivision requesting for a letter of introduction or referral as MONINA was then
job-hunting. However, Lourdes did not comply with the request.
Jose Cruz, a partner at Miller, Cruz & Co., testified that MONINA worked at Miller &
Cruz from 1968 up to 1971, however, he did not personally interview her before she
was accepted for employment. Moreover, MONINA underwent the usual screening
procedure before being hired. Jose recalled that one of the accountants, a certain Mr.
Atienza, reported that MONINA claimed to be FRANCISCOs daughter. Jose then told
Mr. Atienza to speak with MONINA and see if he (Mr. Atienza) could stop her from
spreading this rumor. Mr. Atienza reported that he spoke with MONINA, who told him
that she planned to leave for the United States and needed P20,000.00 for that purpose,
and in exchange, she would sign a document disclaiming filiation with FRANCISCO.
Thus, Jose instructed Mr. Atienza to request that MONINA meet with Jose, and at that
meeting, MONINA confirmed Mr. Atienzas report. Jose then informed Atty. Tirol,
FRANCISCOs personal lawyer, about the matter.
Atty. Tirol told Jose to send MONINA and her lawyer to his (Atty. Tirols) office in
Iloilo. Jose then wrote out a letter of introduction for MONINA addressed to Atty.
Tirol. Jose relayed Atty. Tirols message to MONINA through Mr. Atienza, then later,
Atty. Tirol told Jose to go to Iloilo with a check for P15,000.00. Jose complied, and at
Atty. Tirols office, Jose saw MONINA, Atty. Tirol and his secretary reading some
documents. MONINA then expressed her willingness to sign the
document, sans revisions. Jose alleged that he drew the P15,000.00 from his personal
funds, subject to reimbursement from and due to an understanding with FRANCISCO.
Dolores Argenal, a househelper at Nelly Garden from May 1944 up to May 1946,
testified that she knew that Pansay was Lourdes nanny; that Lourdes slept in her
parents room; that she had not seen FRANCISCO give special treatment to Pansay;
that there was no unusual relationship between FRANCISCO and Pansay, and if there
was any, Dolores would have easily detected it since she slept in the same room
as Pansay. Dolores further declared that whenever FRANCISCOs wife was out of
town, Pansay would bring Lourdes downstairs at nighttime, and that Pansay would not
sleep in the room where FRANCISCO slept. Finally, Dolores declared
that Pansay stopped working for FRANCISCO and his wife in October, 1944.
184
The reception of evidence having been concluded, the parties filed their respective
memoranda.
It need be recalled that Judge Catalino Castaeda, Jr. presided over trial up to 21
October 1986, thereby hearing only the testimonies of MONINAs witnesses and about
half of MONINAs testimony on direct examination. Judge Norberto E. Devera, Jr.
heard the rest of MONINA's testimony and those of FRANCISCOs witnesses.
In its decision of 12 November 1990 12 the trial court, through Judge Devera, dismissed
the complaint with costs against MONINA. In the opening paragraph thereof, it
observed:
This is a complaint for recognition of an illegitimate child instituted by plaintiff
Monina Jison against defendant Francisco Jison. This complaint was filed on March
13, 1985 at the time when plaintiff, reckoned from her death of birth, was already
thirty-nine years old. Noteworthy also is the fact that it was instituted twenty years
after the death of plaintiffs mother, Esperanza Amolar. For the years between plaintiffs
birth and Esperanzas death, no action of any kind was instituted against defendant
either by plaintiff, her mother Esperanza or the latters parents. Neither had plaintiff
brought such an action against defendant immediately upon her mothers death on April
20, 1965, considering that she was then already nineteen years old or, within a
reasonable time thereafter. Twenty years more had to supervene before this complaint
was eventually instituted.
The trial court then proceeded to discuss the four issues stipulated at pre-trial, without,
however, summarizing the testimonies of the witnesses nor referring to the testimonies
of the witnesses other than those mentioned in the discussion of the issues.
The trial court resolved the first issue in the negative, holding that it was improbable
for witness Lope Amolar to have noticed that Pansay was pregnant upon seeing her at
the Elena Apartments in November 1945, since Pansay was then only in her first
month of pregnancy; that there was no positive assertion that copulation did indeed
take place between Francisco and Esperanza; and that MONINAs attempt to show
opportunity on the part of FRANCISCO failed to consider that there was also the
opportunity for copulation between Esperanza and one of the several domestic helpers
admittedly also residing at Nellys Garden at that time. The RTC also ruled that the
probative value of the birth and baptismal certificates of MONINA paled in light of
jurisprudence, especially when the misspellings therein were considered.
The trial court likewise resolved the second issue in the negative, finding that
MONINAs evidence thereon may either be one of three categories, namely: hearsay
evidence, incredulous evidence, or self-serving evidence." To the first category
belonged the testimonies of Adela Casabuena and Alfredo Baylosis, whose knowledge
of MONINAs filiation was based, as to the former, on utterances of defendants wife
Lilia and Esperanza allegedly during the heat of their quarrel, while as to the latter,
Alfredo's conclusion was based from the rumors going [around] that plaintiff is
defendants daughter, from his personal observation of plaintiffs facial appearance
which he compared with that of defendants and from the way the two (plaintiff and
defendant) acted and treated each other on one occasion that he had then opportunity to
closely observe them together. To the second category belonged that of Dominador
Savariz, as:
At each precise time that Esperanza allegedly visited Nellys Garden and allegedly on
those occasions when defendants wife, Lilia was in Manila, this witness was there and
allegedly heard pieces of conversation between defendant and Esperanza related to the
paternity of the latters child. xxx
The RTC then placed MONINAs testimony regarding the acts of recognition accorded
her by FRANCISCOs relatives under the third category, since the latter were never
presented as witnesses, for which reason the trial court excluded the letters from
FRANCISCOs relatives (Exhs. S to V).
As to the third issue, the trial court held that MONINA was not barred by prescription
for it was of the perception that the benefits of Article 268 accorded to legitimate
children may be availed of or extended to illegitimate children in the same manner as
the Family Code has so provided; or by laches, which is [a] creation of equity applied
only to bring equitable results, and addressed to the sound discretion of the court [and]
the circumstances [here] would show that whether plaintiff filed this case immediately
upon the death of her mother Esperanza in 1965 or twenty years thereafter in 1985, xxx
there seems to be no inequitable result to defendant as related to the situation of
plaintiff.
The RTC ruled, however, that MONINA was barred by estoppel by deed because of
the affidavit (Exh. P/Exh. 2) which she signed when she was already twenty-five years,
a professional and under the able guidance of counsel.
Finally, the RTC denied FRANCISCOs claim for damages, finding that MONINA did
not file the complaint with malice, she having been propelled by an honest belief,
founded on probable cause.
MONINA seasonably appealed to the Court of Appeals (CA-G.R. CV No. 32860) and
sought reversal of the trial courts decision on the grounds that:
I
THE TRIAL COURT WAS ERRONEOUSLY PREDISPOSED TO ADJUDGE THIS
CASE AGAINST APPELLANT DUE TO ITS MISPERCEPTION THAT
APPELLANTS DELAY IN FILING HER COMPLAINT WAS FATAL TO HER
CASE.
185
II
THE TRIAL COURT ERRED IN ITS REJECTION OF THE TESTIMONIES OF
APPELLANTS WITNESSES AS TAILOR-MADE, INADEQUATE AND
INCREDIBLE.
III
THE TRIAL COURT ERRED IN ITS REJECTION OF THE ADMISSIBILITY OF
THE CERTIFIED COPIES OF PUBLIC DOCUMENTS PRESENTED BY
APPELLANT AS PART OF HER EVIDENCE.
IV
THE TRIAL COURT ERRED IN ITS REQUIREMENT THAT A WITNESS TO
THE ACTUAL ACT OF COPULATION BETWEEN THE APPELLEE AND
APPELLANTS MOTHER SHOULD HAVE POSITIVELY TESTIFIED TO SAID
EFFECT.
V and confronted his sister. At any rate, what is important is not the month that they met
THE TRIAL COURT ERRED IN REJECTING THE ADMISSIBILITY OF THE
DULY IDENTIFIED NOTES AND LETTER OF THE RELATIVES OF THE
APPELLEE AS HEARSAY.
VI
THE TRIAL COURT ERRED IN CONCLUDING THAT APPELLANTS
AFFIDAVIT (EXH. P) SERVED AS A BAR AGAINST HER CLAIM FOR
RECOGNITION INSTEAD OF REINFORCING SAID CLAIM.13
Expectedly, FRANCISCO refuted these alleged errors in his Appellees
Brief.14cräläwvirtualibräry
In its decision of 27 April 1995, 15 the Court of Appeals initially declared that as no
vested or acquired rights were affected, the instant case was governed by Article 175,
in relation to Articles 172 and 173, of the Family Code. 16 While the Court of Appeals
rejected the certifications issued by the Local Civil Registrar of Dingle, Iloilo (Exhs. E
and F) as FRANCISCO did not sign them, said court focused its discussion on the
other means by which illegitimate filiation could be proved, i.e., the open and
continuous possession of the status of an illegitimate child or, by any other means
allowed by the Rules of Court and special laws, such as the baptismal certificate of the
child, a judicial admission, a family bible wherein the name of the child is entered,
common reputation respecting pedigree, admission by silence, testimonies of witnesses
xxx.17 To the Court of Appeals, the bottom line issue was whether or not MONINA
established her filiation as FRANCISCOs illegitimate daughter by preponderance of
evidence, as to which issue said court found:
[N]ot just preponderant but overwhelming evidence on record to prove that
[MONINA] is the illegitimate daughter of [FRANCISCO] and that she had
continuously enjoyed such status by direct acts of [FRANCISCO] and/or his relatives.
In so ruling, the Court of Appeals observed that the testimonies of Lope Amolar, Adela
Casabuena and Dominador Savariz were already sufficient to establish MONINAs
filiation:
As adverted to earlier, the trial court discredited Lope Amolars testimony by saying
that Lope could not have detected Esperanzas pregnant state in November, 1945 since
at that point in time [sic] she was still in the initial stage of pregnancy. Apparently, the
trial court paid more emphasis on the date mentioned by Lope Amolar than on the
tenor and import of his testimony. As xxx Lope xxx was asked about an incident that
transpired more than 41 years back, [u]nder the circumstances, it is unreasonable to
expect that Lope could still be dead right on the specific month in 1945 that [he] met
but the essence of his testimony that his sister pointed to their employer
[FRANCISCO] as the one responsible for her pregnancy, and that upon being
confronted, [FRANCISCO] assured him of support for Esperanza and their child. It
would appear then that in an attempt to find fault with Lopes testimony, the trial court
has fallen oblivious to the fact that even [FRANCISCO], in his deposition, did not
deny that he was confronted by Lope about what he had done to Esperanza, during
which he unequivocally acknowledged paternity by assuring Lope of support for both
Esperanza and their child.
The Court of Appelas further noted that Casabuena and Savariz testified on something
that they personally observed or witnessed, which matters FRANCISCO did not deny
or refute. Finally, said court aptly held:
Taking into account all the foregoing uncontroverted testimonies xxx let alone such
circumstantial evidence as [MONINAs] Birth Certificates xxx and Baptismal
Certificates which invariably bear the name of [FRANCISCO] as her father, We
cannot go along with the trial courts theory that [MONINAs] illegitimate filiation has
not been satisfactorily established.
xxx
Significantly, [MONINAs] testimony finds ample corroboration from [FRANCISCOs]
former employees, Arsenio Duatin, Rudy Tingson and Alfredo Baylosis. xxx
xxx
186
Carefully evaluating appellants evidence on her enjoyment of the status of an
illegitimate daughter of [FRANCISCO] vis-a-vis [FRANCISCOs] controversion
thereof, We find more weight in the former. The positive testimonies of [MONINA]
and [her] witnesses xxx all bearing on [FRANCISCOs] acts and/or conduct indubitably
showing that he had continuously acknowledged [MONINA] as his illegitimate
daughter have not been succeessfully [sic] refuted. In fact, [FRANCISCO] himself, in
his deposition, only casually dismissed [MONINAs] exhaustive and detailed testimony
as untrue, and with respect to those given by [MONINAs] witnesses, he merely
explained that he had fired [them] from their employment. Needless to state,
[FRANCISCOs] vague denial is grossly inadequate to overcome the probative weight
of [MONINAs] testimonial evidence.
Even the affidavit (Exh 2) which [FRANCISCO] had foisted on the trial court xxx
does not hold sway in the face of [MONINAs] logical explanation that she at first did
agree to sign the affidavit which contained untruthful statements. In fact, she promptly
complained to [FRANCISCO] who, however explained to her that the affidavit was
only for the consumption of his spouse xxx. Further, the testimony of Jose Cruz
concerning the events that led to the execution of the affidavit xxx could not have been
true, for as pointed out by [MONINA], she signed the affidavit xxx almost five months
after she had resigned from the Miller, Cruz & Co. xxx
At any rate, if [MONINA] were not his illegitimate daughter, it would have been
uncalled for, if not absurd, for [FRANCISCO] or his lawyer to have secured
[MONINAs] sworn statement xxx On the contrary, in asking [MONINA] to sign the
said affidavit at the cost of P15,000, [FRANCISCO] clearly betrayed his intention to
conceal or suppress his paternity of [MONINA]. xxx
In fine, We hold that [MONINAs] filiation as [FRANCISCOs] illegitimate daughter
has been conclusively established by the uncontroverted testimonies of Lope Amolar,
Adela Casabuena and Dominador Savariz to the effect that appellee himself had
admitted his paternity of the appellee, and also by the testimonies of appellant, Arsenio
Duatin, Romeo Bilbao, Rudy Tingson and Alfredo Baylosis unerringly demonstrating
that by his own conduct or overt acts like sending appellant to school, paying for her
tuition fees, school uniforms, books, board and lodging at the Colegio del Sagrado
Corazon de Jesus, defraying appellants hospitalization expenses, providing her with [a]
monthly allowance, paying for the funeral expenses of appellants mother,
acknowledging appellants paternal greetings and calling appellant his Hija or child,
instructing his office personnel to give appellants monthly allowance, recommending
appellant for employment at the Miller, Cruz & Co., allowing appellant to use his
house in Bacolod and paying for her long distance telephone calls, having appellant
spend her vacation in his apartment in Manila and also at his Forbes residence,
allowing appellant to use his surname in her scholastic and other records (Exhs Z, AA,
AA-1 to AA-5, W & W-5), appellee had continuously recognized appellant as his
illegitimate daughter. Added to these are the acts of [FRANCISCOs] relatives
acknowledging or treating [MONINA] as [FRANCISCOs] daughter (Exh U) or as
their relative (Exhs T & V). On this point, witness Zafiro Ledesma, former Mayor of
Iloilo City, whose spouse belongs to the Lopez clan just like [FRANCISCO], testified
that [MONINA] has been considered by the Lopezes as a relative. He identified
pictures of the appellee in the company of the Lopezes (Exhs X-16 & X-17). Another
witness, Danthea H. Lopez, whose husband Eusebio Lopez is appellees first cousin,
testified that appellant was introduced to her by appellees cousin, Remedios Lopez
Franco, as the daughter of appellee Francisco Jison, for which reason, she took her in
as [a] secretary in the Merchants Financing Corporation of which she was the manager,
and further allowed her to stay with her family free of board and lodging. Still on this
aspect, Dominador Savariz declared that sometime in February, 1966 appellees
relative, Ms. Remedios Lopez Franco pointed to appellant as the daughter of appellee
Francisco Jison.
Finally, the Certifications of the Local Civil Registrar of Dingle (Exhs E and F) as well
as [MONINAs] Baptismal Certificates (Exhs C & D) which the trial ocurt admitted in
evidence as part of [MONINAs] testimony, may serve as circumstantial evidence to
further reinforce [MONINAs] claim that she is [FRANCISCOs] illegitimate daughter
by Esperanza Amolar.
True it is that a trial judges assessment of the credibility of witnesses is accorded great
respect on appeal. But the rule admits of certain exceptions. One such exception is
where the judge who rendered the judgment was not the one who heard the witnesses
testify. [citations omitted] The other is where the trial court had overlooked,
misunderstood or misappreciated some facts or circumstances of weight and substance
which, if properly considered, might affect the result of the case. [citations omitted] In
the present case, both exceptions obtain. All of [MONINAs] witnesses xxx whose
testimonies were not given credence did not testify before the judge who rendered the
disputed judgment. xxx
The Court of Appeals then decreed:
WHEREFORE, premises considered, the judgment of the trial court is SET ASIDE
and another one is hereby entered for appellant Monina Jison, declaring her as the
illegitimate daughter of appellee Francisco Jison, and entitled to all rights and
privileges granted by law.
Costs against appellee.
SO ORDERED.
187
His motion for reconsideration having been denied by the Court of Appeals in its
resolution of 29 March 1996,18 FRANCISCO filed the instant petition. He urges us to
reverse the judgment of the Court of Appeals, alleging that said court committed errors
of law:
I.
IN REVERSING THE DECISION OF THE TRIAL COURT AND DECLARING
PRIVATE RESPONDENT AS THE ILLEGITIMATE CHILD OF PETITIONER,
CONSIDERING [THE] IMPOSSIBILITY OF SEXUAL CONTACT BETWEEN
THE PETITIONER AND THE PRIVATE RESPONDENT'S MOTHER AT THE
TIME CONCEPTION WAS SUPPOSED TO HAVE OCCURRED.
II.
IN REVERSING THE TRIAL COURTS FINDING CONSIDERING THAT
PRIVATE RESPONDENT'S TESTIMONIAL EVIDENCE OF PATERNITY AND
FILIATION IS NOT CLEAR AND CONVINCING.
III.
IN GIVING CREDENCE TO DOCUMENTARY EVIDENCE PRESENTED BY
THE PRIVATE RESPONDENT AS EVIDENCE OF FILIATION CONSIDERING
THAT THE SAME ARE HEARSAY, SELF-SERVING AND CANNOT BIND THE
PETITIONER UNDER THE BASIC RULES OF EVIDENCE.
IV.
IN INTERPRETING THE PRIVATE RESPONDENT'S SWORN STATEMENT
(EXH. P/EXH. 2) IN A MANNER NOT IN CONSONANCE WITH THE RULINGS
OF THE HONORABLE SUPREME COURT.
V.
IN NOT CONSIDERING THE LONG AND UNEXPLAINED DELAY IN THE
FILING OF THE PRESENT PATERNITY SUIT AS EQUIVALENT TO LACHES.
As regards the first error, FRANCISCO insists that taking into account the second
paragraph of MONINAs complaint wherein she claimed that he and Pansay had sexual
relations by about the end of 1945 or the start of 1946, it was physically impossible for
him and Pansay to have had sexual contact which resulted in MONINAs birth,
considering that:
The normal period of human pregnancy is nine (9) months. If as claimed by private
respondent in her complaint that her mother was impregnated by FRANCISCO at the
end of 1945 or the start of 1946, she would have been born sometime in late September
or early October and not August 6, 1946 xxx. The instant case finds factual and legal
parallels in Constantino vs. Mendez,19 thus: xxx
FRANCISCO further claims that his testimony that Pansay was no longer employed
by him at the time in question was unrebutted, moreover, other men had access
to Pansay during the time of or even after her employment by him.
As to the second error, FRANCISCO submits that MONINAs testimonial evidence is
shaky, contradictory and unreliable, and proceeds to attack the credibility of her
witnesses by claiming, in the main, that: (a) Lope Amolar could not have
detected Pansays pregnancy in November 1945 when they met since she would have
been only one (1) month pregnant then; (b) Dominador Savariz did not in fact witness
the meeting between FRANCISCO, Pansay and MONINA; (c) Zafiro Ledesma had an
ulterior motive in testifying for MONINA as he owned a bank in Iloilo which was then
under Central Bank supervision and MONINA was the Bank Examiner assigned to
Iloilo; and (d) Danthea Lopez was not related to him by blood and whatever favorable
treatment MONINA received from Danthea was due to the formers employment at
Merchants Financing Company and additional services rendered at Kahirup Hotel;
besides, Danthea admitted that she had no personal knowledge as to the issue of
paternity and filiation of the contending parties, hence Sections 39 and 40 20 of Rule
130 of the Rules of Court did not come into play. FRANCISCO likewise re-echoes the
view of the trial court as regards the testimonies of Adela Casabuena and Alfredo
Baylosis.
FRANCISCO further asserts that MONINAs testimony that he answered for her
schooling was self-serving and uncorroborated by any receipt or other documentary
evidence; and assuming he did, such should be interpreted as a manifestation of
kindness shown towards the family of a former household helper.
Anent the treatment given by his relatives to MONINA as his daughter, FRANCISCO
points to the fact that Pansay was the former laundrywoman of Mrs. Franco;
MONINA resided with the families of Eusebio Lopez and Concha Cuaycong because
she was in their employ at Kahirup Hotel and Our Lady of Mercy Hospital,
respectively; MONINA failed to present Mrs. Franco, Eusebio Lopez and Mrs.
Cuaycong; and MONINAs employment at the accounting firm of Miller, Cruz & Co.
was attributable to her educational attainment, there being absolutely no evidence to
prove that FRANCISCO ever facilitated her employment thereat. Hence, in light of
Baluyot v. Baluyot,21 the quantum of evidence to prove paternity by clear and
convincing evidence, not merely a preponderance thereof, was not met.
With respect to the third assigned error, FRANCISCO argues that the Court of Appeals
reliance on the certifications of the Local Civil Registrar (Exhs. E and F) and
Baptismal Certificates (Exhs. C and D) as circumstantial evidence is misplaced. First,
their genuineness could not be ascertained as the persons who issued them did not
188
testify. Second, in light of Reyes v. Court of Appeals,22 the contents of the baptismal
certificates were hearsay, as the data was based only on what was told to the priest who
solemnized the baptism, who likewise was not presented as a witness. Additionally, the
name of the father appearing therein was Franque Jison, which was not FRANCISCOs
name. Third, in both Exhibits E and F, the names of the childs parents were listed as
Frank Heson and Esperanza Amador (not Amolar). FRANCISCO further points out
that in Exhibit F, the status of the child is listed as legitimate, while the fathers
occupation as laborer. Most importantly, there was no showing that FRANCISCO
signed Exhibits E and F or that he was the one who reported the childs birth to the
Office of the Local Civil Registrar. As to MONINAs educational records,
FRANCISCO invokes Baas v. Baas23 which recognized that school records are
prepared by school authorities, not by putative parents, thus incompetent to prove
paternity. And, as to the photographs presented by MONINA, FRANCISCO cites
Colorado v. Court of Appeals,24 and further asserts that MONINA did not present any
of the persons with whom she is seen in the pictures to testify thereon; besides these
persons were, at best, mere second cousins of FRANCISCO. He likewise assails the
various notes and letters written by his relatives (Exhs. S to V) as they were not
identified by the authors. Finally, he stresses that MONINA did not testify as to the
telephone cards (Exhs. G to L) nor did these reveal the circumstances surrounding the
calls she made from his residence.
Anent the fourth assigned error, FRANCISCO contends that the Court of Appeals
interpretation of MONINAs affidavit of 21 September 1971 ran counter to Dequito v.
Llamas,25 and overlooked that at the time of execution, MONINA was more than 25
years old and assisted by counsel.
As to the last assigned error, FRANCISCO bewails the Court of Appeals failure to
consider the long and unexplained delay in the filing of the case.
In her comment, MONINA forcefully refuted FRANCISCOs arguments, leading
FRANCISCO to file his reply thereto.
On 20 November 1996, we gave due course to this petition and required the parties to
submit their respective memoranda, which they subsequently did.
A painstaking review of the evidence and arguments fails to support petitioner.
Before addressing the merits of the controversy, we first dispose of preliminary matters
relating to the applicable law and the guiding principles in paternity suits. As to the
former, plainly, the Family Code of the Philippines (Executive Order No. 209) governs
the present controversy. As correctly cited by the Court of Appeals,
Uyguangco26 served as a judicial confirmation of Article 256 of the Family
Code27 regarding its retroactive effect unless there be impairment of vested rights,
which does not hold true here, it appearing that neither the putative parent nor the child
has passed away and the former having actually resisted the latters claim below.
Under Article 175 of the Family Code, illegitimate filiation, such as MONINA's, may
be established in the same way and on the same evidence as that of legitimate children.
Article 172 thereof provides the various forms of evidence by which legitimate
filiation is established, thus:
ART. 172. The filiation of legitimate children is established by any of the following:
(1) The record of birth appearing in the civil register or a final judgment; or
(2) An admission of legitimate filiation in a public document or a private handwritten
instrument signed by the parent concerned.
In the absence of the foregoing evidence, the legitimate filiation shall be proved by:
(1) The open and continuous possession of the status of a legitimate child; or
(2) Any other means allowed by the Rules of Court and special laws.
This Article reproduces, with amendments, Articles 265, 266 and 267 of the Civil
Code.
For the success of an action to establish illegitimate filiation under the second
paragraph, which MONINA relies upon given that she has none of the evidence
mentioned in the first paragraph, a high standard of proof 28 is required. Specifically, to
prove open and continuous possession of the status of an illegitimate child, there must
be evidence of the manifestation of the permanent intention of the supposed father to
consider the child as his, by continuous and clear manifestations of parental affection
and care, which cannot be attributed to pure charity. Such acts must be of such a nature
that they reveal not only the conviction of paternity, but also the apparent desire to
have and treat the child as such in all relations in society and in life, not accidentally,
but continuously.29cräläwvirtualibräry
By continuous is meant uninterrupted and consistent, but does not require any
particular length of time.30
The foregoing standard of proof required to establish ones filiation is founded on the
principle that an order for recognition and support may create an unwholesome
atmosphere or may be an irritant in the family or lives of the parties, so that it must be
issued only if paternity or filiation is established by clear and convincing evidence. 31
The foregoing discussion, however, must be situated within the general rules on
evidence, in light of the burden of proof in civil cases, i.e., preponderance of evidence,
and the shifting of the burden of evidence in such cases. Simply put, he who alleges the
affirmative of the issue has the burden of proof, and upon the plaintiff in a civil case,
189
the burden of proof never parts. However, in the course of trial in a civil case, once
plaintiff makes out a prima facie case in his favor, the duty or the burden of evidence
shifts to defendant to controvert plaintiffs prima facie case, otherwise, a verdict must
be returned in favor of plaintiff. Moreover, in civil cases, the party having the burden
of proof must produce a preponderance of evidence thereon, with plaintiff having to
rely on the strength of his own evidence and not upon the weakness of the defendants.
The concept of preponderance of evidence refers to evidence which is of greater
weight, or more convincing, that which is offered in opposition to it; at bottom, it
means probability of truth.32
With these in mind, we now proceed to resolve the merits of the instant controversy.
FRANCISCOs arguments in support of his first assigned error deserve scant
consideration. While it has been observed that unlawful intercourse will not be
presumed merely from proof of an opportunity for such indulgence, 33 this does not
favor FRANCISCO. Akin to the crime of rape where, in most instances, the only
witnesses to the felony are the participants in the sexual act themselves, in deciding
paternity suits, the issue of whether sexual intercourse actually occurred inevitably
redounds to the victims or mothers word, as against the accuseds or putative fathers
protestations. In the instant case, MONINAs mother could no longer testify as to the
fact of intercourse, as she had, unfortunately, passed away long before the institution of
the complaint for recognition. But this did not mean that MONINA could no longer
prove her filiation. The fact of her birth and her parentage may be established by
evidence other than the testimony of her mother. The paramount question then is
whether MONINAs evidence is coherent, logical and natural.34cräläwvirtualibräry
The complaint stated that FRANCISCO had carnal knowledge of Pansay by about the
end of 1945. We agree with MONINA that this was broad enough to cover the fourth
quarter of said year, hence her birth on 6 August 1946 could still be attributed to sexual
relations between FRANCISCO and MONINAs mother. In any event, since it was
established that her mother was still in the employ of FRANCISCO at the time
MONINA was conceived as determined by the date of her birth, sexual contact
between FRANCISCO and MONINAs mother was not at all impossible, especially in
light of the overwhelming evidence, as hereafter shown, that FRANCISCO fathered
MONINA, has recognized her as his daughter and that MONINA has been enjoying
the open and continuous possession of the status as FRANCISCOs illegitimate
daughter.
We readily conclude that the testimonial evidence offered by MONINA, woven by her
narration of circumstances and events that occurred through the years, concerning her
relationship with FRANCISCO, coupled with the testimonies of her witnesses,
overwhelmingly established the following facts:
1) FRANCISCO is MONINAs father and she was conceived at the time when her
mother was in the employ of the former;
2) FRANCISCO recognized MONINA as his child through his overt acts and conduct
which the Court of Appeals took pains to enumerate, thus:
[L]ike sending appellant to school, paying for her tuition fees, school uniforms, books,
board and lodging at the Colegio del Sagrado de Jesus, defraying appellants
hospitalization expenses, providing her with [a] monthly allowance, paying for the
funeral expenses of appellants mother, acknowledging appellants paternal greetings
and calling appellant his Hija or child, instructing his office personnel to give
appellants monthly allowance, recommending appellant for employment at the Miller,
Cruz & Co., allowing appellant to use his house in Bacolod and paying for her long
distance telephone calls, having appellant spend her vacation in his apartment in
Manila and also at his Forbes residence, allowing appellant to use his surname in her
scholastic and other records (Exhs Z, AA, AA-1 to AA-5, W & W-5)
3) Such recognition has been consistently shown and manifested throughout the years
publicly,35spontaneously, continuously and in an uninterrupted manner.36
Accordingly, in light of the totality of the evidence on record, the second assigned
error must fail.
There is some merit, however, in the third assigned error against the probative value of
some of MONINAs documentary evidence.
MONINAs reliance on the certification issued by the Local Civil Registrar concerning
her birth (Exhs. E and F) is clearly misplaced. It is settled that a certificate of live birth
purportedly identifying the putative father is not competent evidence as to the issue of
paternity, when there is no showing that the putative father had a hand in the
preparation of said certificates, and the Local Civil Registrar is devoid of authority to
record the paternity of an illegitimate child upon the information of a third
person.37 Simply put, if the alleged father did not intervene in the birth certificate, e.g.,
supplying the information himself, the inscription of his name by the mother or doctor
or registrar is null and void; the mere certificate by the registrar without the signature
of the father is not proof of voluntary acknowledgment on the latters part. 38 In like
manner, FRANCISCOs lack of participation in the preparation of the baptismal
certificates (Exhs. C and D) and school records (Exhs. Z and AA) renders these
documents incompetent to prove paternity, the former being competent merely to
prove the administration of the sacrament of baptism on the date so
specified.39 However, despite the inadmissibility of the school records per se to prove
paternity, they may be admitted as part of MONINAs testimony to corroborate her
claim that FRANCISCO spent for her education.
190
We likewise disagree with the ruling of the Court of Appeals that the certificates issued
by the Local Civil Registrar and the baptismal certificates may be taken as
circumstantial evidence to prove MONINAs filiation. Since they are per
se inadmissible in evidence as proof of such filiation, they cannot be admitted
indirectly as circumstantial evidence to prove the same.
As to Exhibits S, T, U and V, the various notes and letters written by FRANCISCOs
relatives, namely Mike Alano, Emilio Jison, Mariquit Lopez and Fernando Lopez,
respectively, allegedly attesting to MONINAs filiation, while their due execution and
authenticity are not in issue,40 as MONINA witnessed the authors signing the
documents, nevertheless, under Rule 130, Section 39, the contents of these documents
may not be admitted, there being no showing that the declarants-authors were dead or
unable to testify, neither was the relationship between the declarants and MONINA
shown by evidence other than the documents in question.41 As to the admissibility of
these documents under Rule 130, Section 40, however, this requires further
elaboration.
Rule 130, Section 40, provides:
Section 40. Family reputation or tradition regarding pedigree. -- The reputation or
tradition existing in a family previous to the controversy, in respect to the pedigree of
any one of its members, may be received in evidence if the witness testifying
thereon be also a member of the family, either by consanguinity or affinity. Entries in
family bibles or other family books or charts, engravings on rings, family portraits and
the like, may be received as evidence of pedigree. (underscoring supplied)
It is evident that this provision may be divided into two (2) parts: the portion
containing the first underscored clause which pertains to testimonial evidence, under
which the documents in question may not be admitted as the authors thereof did not
take the witness stand; and the section containing the second underscored phrase. What
must then be ascertained is whether Exhibits S to V, as private documents, fall within
the scope of the clause and the like as qualified by the preceding phrase [e]ntries in
family bibles or other family books or charts, engravings on rights [and] family
portraits.
We hold that the scope of the enumeration contained in the second portion of this
provision, in light of the rule of ejusdem generis, is limited to objects which are
commonly known as family possessions, or those articles which represent, in effect, a
familys joint statement of its belief as to the pedigree of a person. 42These have been
described as objects openly exhibited and well known to the family, 43 or those which,
if preserved in a family, may be regarded as giving a family tradition. 44 Other examples
of these objects which are regarded as reflective of a familys reputation or tradition
regarding pedigree are inscriptions on tombstones,45 monuments or coffin plates.46
Plainly then, Exhibits S to V, as private documents not constituting "family
possessions" as discussed above, may not be admitted on the basis of Rule 130,
Section 40. Neither may these exhibits be admitted on the basis of Rule 130, Section
41 regarding common reputation,47it having been observed that:
[T]he weight of authority appears to be in favor of the theory that it is the general
repute, the common reputation in the family, and not the common reputation in
community, that is a material element of evidence going to establish pedigree. xxx
[Thus] matters of pedigree may be proved by reputation in the family, and not by
reputation in the neighborhood or vicinity, except where the pedigree in question is
marriage which may be proved by common reputation in the community.48
Their inadmissibility notwithstanding, Exhibits S to V, inclusive, may, in like manner
as MONINA's school records, properly be admitted as part of her testimony to
strengthen her claim that, indeed, relatives of FRANCISCO recognized her as his
daughter.
We now direct our attention to MONINAs 21 September 1971 affidavit (Exh. P/Exh.
2), subject of the fourth assigned error, where she attests that FRANCISCO is not her
father. MONINA contends that she signed it under duress, i.e., she was jobless, had no
savings and needed the money to support herself and finish her studies. Moreover, she
signed Exhibit P upon the advice of Atty. Divinagracia that filiation could not be
waived and that FRANCISCOs ploy would boomerang upon him. On the other hand,
FRANCISCO asserts that full credence should be afforded Exhibit P as MONINA was
already 25 years old at the time of its execution and was advised by counsel; further,
being a notarized document, its genuineness and due execution could not be
questioned. He relies on the testimony of Jose Cruz, a partner at the accounting firm of
Miller & Cruz, who declared that he intervened in the matter as MONINA was
spreading rumors about her filiation within the firm, which might have had deleterious
effects upon the relationship between the firm and FRANCISCO.
On this issue, we find for MONINA and agree with the following observations of the
Court of Appeals:
Even the affidavit (Exh 2) which [FRANCISCO] had foisted on the trial court xxx
does not hold sway in the face of [MONINAs] logical explanation that she at first did
agree to sign the affidavit which contained untruthful statements. In fact, she promptly
complained to [FRANCISCO] who, however explained to her that the affidavit was
only for the consumption of his spouse xxx.
191
At any rate, if [MONINA] were not his illegitimate daughter, it would have been
uncalled for, if not absurd, for [FRANCISCO] or his lawyer to have secured
[MONINAs] sworn statement xxx On the contrary, in asking [MONINA] to sign the
said affidavit at the cost of P15,000, [FRANCISCO] clearly betrayed his intention to
conceal or suppress his paternity of [MONINA]. xxx
Indeed, if MONINA were truly not FRANCISCOs illegitimate daughter, it would have
been unnecessary for him to have gone to such great lengths in order that MONINA
denounce her filiation. For as clearly established before the trial court and properly
appreciated by the Court of Appeals, MONINA had resigned from Miller & Cruz five
(5) months prior to the execution of the sworn statement in question, hence negating
FRANCISCOs theory of the need to quash rumors circulating within Miller & Cruz
regarding the identity of MONINAs father. Hence, coupled with the assessment of the
credibility of the testimonial evidence of the parties discussed above, it is evident that
the standard to contradict a notarial document, i.e., clear and convincing evidence and
more than merely preponderant,49 has been met by MONINA.
Plainly then, the burden of evidence fully shifted to FRANCISCO.
Two (2) glaring points in FRANCISCOs defense beg to be addressed: First, that his
testimony was comprised of mere denials, rife with bare, unsubstantiated responses
such as That is not true, I do not believe that, or None that I know. In declining then to
lend credence to FRANCISCOs testimony, we resort to a guiding principle in
adjudging the credibility of a witness and the truthfulness of his statements, laid down
as early as 1921:
The experience of courts and the general observation of humanity teach us that the
natural limitations of our inventive faculties are such that if a witness undertakes to
fabricate and deliver in court a false narrative containing numerous details, he is almost
certain to fall into fatal inconsistencies, to make statements which can be readily
refuted, or to expose in his demeanor the falsity of his message.
For this reason it will be found that perjurers usually confine themselves to the
incidents immediately related to the principal fact about which they testify, and when
asked about collateral facts by which their truthfulness could be tested, their answers
not infrequently take the stereotyped form of such expressions as I dont know or I dont
remember. xxx50cräläwvirtualibräry
Second, the reasons for the dismissals of Tingson, Baylosis and Savariz were
unspecified or likewise unsubstantiated, hence FRANCISCOs attempt to prove ill-
motive on their part to falsely testify in MONINAs favor may not succeed. As may be
gleaned, the only detail which FRANCISCO could furnish as to the circumstances
surrounding the dismissals of his former employees was that Baylosis allegedly took
advantage of his position while FRANCISCO was in the United States. But aside from
this bare claim, FRANCISCOs account is barren, hence unable to provide the basis for
a finding of bias against FRANCISCO on the part of his former employees.
As to FRANCISCOs other witnesses, nothing substantial could be obtained either.
Nonito Jalandoni avowed that he only came to know of MONINA in June 1988; 51 that
during his employment at Nelly Garden from 1963 up to 1974, he did not recall ever
having seen MONINA there, neither did he know of any instructions from
FRANCISCO nor Mr. Lagarto (FRANCISCOs office manager before passing away)
regarding the disbursement of MONINAs allowance.52 Teodoro Zulla corroborated
Jalandonis testimony regarding not having seen MONINA at Nelly Garden and
MONINAs allowance; declared that Alfredo Baylosis was dismissed due to
discrepancies discovered after an audit, without any further elaboration, however; but
admitted that he never prepared the vouchers pertaining to FRANCISCOs personal
expenses, merely those intended for one of FRANCISCOs haciendas. 53 Then, Iigo
Superticioso confirmed that according to the report of a certain Mr. Atienza, Baylosis
was dismissed by Mr. Jison for irregularities, while Superticioso was informed by
FRANCISCO that Tingson was dismissed for loss of confidence. Superticioso likewise
denied that MONINA received money from FRANCISCOs office, neither was there a
standing order from FRANCISCO to release funds to her.54
It is at once obvious that the testimonies of these witnesses for FRANCISCO are
likewise insufficient to overcome MONINAs evidence. The former merely consist of
denials as regards the latters having gone to Nelly Garden or having received her
allowance from FRANCISCOs office, which, being in the form of negative testimony,
necessarily stand infirm as against positive testimony; 55 bare assertions as regards the
dismissal of Baylosis; ignorance of FRANCISCOs personal expenses incapable of
evincing that FRANCISCO did not provide MONINA with an allowance; or hearsay
evidence as regards the cause for the dismissals of Baylosis and Tingson. But what
then serves as the coup de grce is that despite Superticiosos claim that he did not know
MONINA,56 when confronted with Exhibit H, a telephone toll ticket indicating that on
18 May 1971, MONINA called a certain Eing at FRANCISCOs office, Superticioso
admitted that his nickname was Iing and that there was no other person named Iing in
FRANCISCOs office.57
All told, MONINAs evidence hurdled the high standard of proof required for the
success of an action to establish ones illegitimate filiation when relying upon the
provisions regarding open and continuous possession or any other means allowed by
the Rules of Court and special laws; moreover, MONINA proved her filiation by more
than mere preponderance of evidence.
The last assigned error concerning laches likewise fails to convince. The essential
elements of laches are: (1) conduct on the part of the defendant, or of one under whom
he claims, giving rise to the situation of which the complaint seeks a remedy; (2) delay
in asserting the complainants rights, the complainant having had knowledge or notice
192
of the defendants conduct as having been afforded an opportunity to institute a suit; (3)
lack of knowledge or notice on the part of the defendant that the complaint would
assert the right in which he bases his suit; and (4) injury or prejudice to the defendant
in the event relief is accorded to the complainant, or the suit is not held barred. 58 The
last element is the origin of the doctrine that stale demands apply only where by reason
of the lapse of time it would be inequitable to allow a party to enforce his legal rights.59
As FRANCISCO set up laches as an affirmative defense, it was incumbent upon him
to prove the existence of its elements. However, he only succeeded in showing
MONINAs delay in asserting her claim, but miserably failed to prove the last element.
In any event, it must be stressed that laches is based upon grounds of public policy
which requires, for the peace of society, the discouragement of stale claims, and is
principally a question of the inequity or unfairness of permitting a right or claim to be
enforced or asserted. There is no absolute rule as to what constitutes laches; each case
is to be determined according to its particular circumstances. The question of laches is
addressed to the sound discretion of the court, and since it is an equitable doctrine, its
application is controlled by equitable considerations. It cannot be worked to defeat
justice or to perpetuate fraud and injustice. 60 Since the instant case involves paternity
and filiation, even if illegitimate, MONINA filed her action well within the period
granted her by a positive provision of law. A denial then of her action on ground of
laches would clearly be inequitable and unjust.
WHEREFORE, IN VIEW OF THE FOREGOING, the petition is hereby DENIED
and the challenged decision of the Court of Appeals of 27 April 1995 in CA-G.R. CV
No. 32860 is AFFIRMED.
SO ORDERED.
Notes.—The phrase “vested or acquired rights” under Article 256 is not defined by the
Family Code, leaving it to the courts to determine what it means as each particular
issue is submitted to them. (Aruego, Jr. vs. Court of Appeals, 254 SCRA 711 [1996])
In the absence of titles indicated in Art. 265 of the Civil Code, the filiation of children
may be proven by continuous possession of the status of a legitimate child and by any
other means allowed by the Rules of Court or special laws. (Balogbog vs. Court of
Appeals, 269 SCRA 259 [1997])
There is no presumption of the law more firmly established and founded on sounder
morality and more convincing reason than the presumption that children born in
wedlock are legitimate. (Tison vs. Court of Appeals, 276 SCRA 582 [1997]) Jison vs.
Court of Appeals, 286 SCRA 495, G.R. No. 124853 February 24, 1998
G.R. No. 92740. March 23, 1992.
PHILIPPINE AIRLINES, INC., petitioner, vs. JAIME M. RAMOS, NILDA
RAMOS, ERLINDA ILANO, MILAGROS ILANO, DANIEL ILANO AND
FELIPA JAVALERA, respondents.
Evidence; Documentary evidence; Writing or document made contemporaneously with
transaction regarded as more reliable proof than oral testimony.—In the absence of any
controverting evidence, the documentary evidence presented to corroborate the
testimonies of PAL’s witnesses are prima facie evidence of the truth of their
allegations. The plane tickets of the private respondents, exhs. “1,” “2,” “3,” “4,” (with
emphasis on the printed condition of the contract of carriage regarding check-in time
as well as on the notation “late 4:02” stamped on the flight coupon by the check-in
clerk immediately upon the check-in of private respondents) and the passenger
Manifest of Flight PR 264, exh. “5,” (which showed the non-accommodation of Capati
and Go and the private respondents) are entries made in the regular course of business
which the private respondents failed to overcome with substantial and convincing
evidence other than their testimonies. Consequently, they carry more weight and
credence. A writing or document made contemporaneously with a transaction in which
are evidenced facts pertinent to an issue, when admitted as proof of those facts, is
ordinarily regarded as more reliable proof and of greater probative force than the oral
testimony of a witness as to such facts based upon memory and recollection (20 Am
Jur S 1179, 1029 cited in Francisco, Revised Rules of Court in the Philippines
Annotated, 1973 Edition, Volume VII, Part II, p. 654).
Same; Same; Exception to hearsay rule; Res gestae.—The hearsay rule will not apply
in this case as statements, acts or conduct accompanying or so nearly connected with
the main transaction as to form a part of it, and which illustrate, elucidate, qualify or
characterize the act, are admissible as part of the res gestae (32 C.J.S., S. 411, 30-31).
Common carriers; Contract of carriage; Passengers bound by conditions of contract.—
When the private respondents purchased their tickets, they were instantaneously bound
by the conditions of the contract of carriage particularly the check-in time requirement.
The terms of the contract are clear. Their failure to come on time for check-in should
not militate against PAL. Their non-accommodation on that flight was the result of
their own action or inaction and the ensuing cancellation of their tickets by PAL is
only proper. Philippine Airlines, Inc. vs. Ramos, 207 SCRA 461, G.R. No. 92740
March 23, 1992
This petition for review on certiorari seeks to reverse the decision of the Court of
Appeals dated March 15, 1990 affirming in toto the decision of the Regional Trial
Court of Imus, Cavite, Branch 21, directing the Philippine Airlines, Inc. (PAL, for
short) to pay the private respondents the amounts specified therein as actual, moral and
temperate damages as well as attorney's fees and expenses of litigation.
193
The antecedents facts are briefly recounted by the appellate court, as follows:
Plaintiffs Jaime Ramos, Nilda Ramos, Erlinda Ilano, Milagros Ilano, Daniel Ilano and
Felipe Javalera, are officers of the Negros Telephone Company who held confirmed
tickets for PAL Flight No. 264 from Naga City to Manila on September 24, 1985,
scheduled to depart for Manila at 4:25 p.m. The tickets were brought sometime in
August 1985. Among the conditions included in plaintiffs tickets is the following:
1. CHECK-IN TIME — Please check in at the Airport Passenger check-in counter at
least one hour before PUBLISHED departure time of your flight. We will consider
your accommodation forfeited in favor of waitlisted passenger if you fail to check-
in at least 30 minutes before PUBLISHED departure time. (Exhs. (1-A-A, 2-A-1, S-A,
O-A-1, tsn. Nov 23, 1987, p. 8).
Plaintiffs claim in their Complaint that they went tot he check-in counter of the
defendant's Naga branch at least one (1) hour before the published departure time but
no one was at the counter until 30 minutes before departure, but upon checking -in and
presentation of their tickets to the employee/clerk who showed up, their tickets were
cancelled and the seats awarded to chance passengers; plaintiffs had to go to Manila by
bus, and seek actual, moral and exemplary damages, and attorney's fees for breach of
contract of carriage.
Defendant disclaim any liability, claiming that the non-accommodation of plaintiff on
the said flight was due to their having check-in (sic) late for their flight. It is averred
even if defendant is found liable to the plaintiffs such liability is confined to, and
limited by, the CAB Economic Regulations No. 7 in conjunction with P.D. 589.
The trial court rendered judgment finding defendant guilty of breach of contract of
carriage in bumping-off the plaintiffs from its F264 flight of September 25, 1985, and
ordered defendant to pay:
1) P1,250.20 — the total value of the tickets:
2) P22.50 — the total value of airport security fees and terminal fees;
3) P20,000.00 — for each of the plaintiffs for moral and temperate damages; and
4) P5,000.00 — for attorney's fees and expenses of litigation. (Rollo, pp. 35-36)
PAL appealed to the Court of Appeals. On March 15, 990, the appellate court rendered
a decision, the dispositive portion of which, reads:
WHEREFORE, the decision appealed from is AFFIRMED in toto, with costs against
appellant.
SO ORDERED. (Rollo, p. 42)
Hence, this present petition with the following legal questions:
1. Can the Honorable Court of Appeals validity promulgate the questioned decision by
the simple expedient of adopting in toto the trial court's finding that defendant-
appellant is liable for damages on the sole issue of credibility of witnesses without
considering the material admissions made by the plaintiffs and other evidence on
record that substantiate the defense of defendant-appellant.
2. Can the Honorable Court award legally moral and temperate damages plus attorney's
fees of P5,000.00 contrary to the evidence and established jurisprudence. (Rollo, p. 9)
Under Section 1, Rule 131 of the Rules of Court, each party in a case is required to
prove his affirmative allegations. In civil cases, the degree of evidence required of a
party in order to support his claim is preponderance of evidence or that evidence
adduced by one party which is more conclusive and credible than that of the other
party (Stronghold Insurance Company, Inc. vs. Court of Appeals, et al., G.R. No.
83376, May 29, 1989, 173 SCRA 619, 625).
The case at bar presents a simple question of fact: Whether or not the private
respondents were late in checking-in for their flight from Naga City to Manila on
September 24. 1985. It is immediately apparent from the records of this case that the
claims of the parties on this question are dramatically opposed. As a rule, the
determination of a question of fact depends largely on the credibility of
witnesses unless some documentary evidence is available which clearly substantiates
the issue and whose genuineness and probative value is not disputed (Legarda v.
Miaile, 88 Phil. 637, 642). The exception to the rule now runs true in this case.
We reverse. This case once more illustrates Our power to re-weigh the findings of
lower courts when the same are not supported by the record or not based on substantial
evidence (see Cruz v. Villarin, G.R. No. 75679, January 12, 1990, 181 SCRA 53, 61).
It is an admitted fact that the private respondents knew of the required check-in time
for passengers. The time requirement is prominently printed as one of the conditions of
carriage on their tickets, i.e., that the airport passenger should check-in at least one
hour before published departure time of his flight and PAL shall consider his
accommodation forfeited in favor of waistlisted passengers if he fails to check-in at
least 30 minutes.
We note that while the aforequoted condition has always been applied strictly and
without exception (TSN, December 16, 1987, p. 11), the station manager, however,
may exercise his discretion to allow passengers who checked-in late to
board provided the flight is not fully booked and seats are available (ibid, pp. 17-18).
On September 24, 1985, flight 264 from Naga to Manila was fully booked owing to the
Peñafrancia Festival (TSN, January 25, 1988, p.5). In addition, PAL morning flights
261 and 262 were canceled resulting in a big number o f waitlisted passengers. (TSN,
194
November 23,
1987, p. 6).
The private respondents claim that they were on time in checking-in for their flight;
that no PAL personnel attended to them until much later which accounted for their late
check-in; that PAL advanced the check-in time and the departure of their flight
resulting in their non-accommodation; and that they suffered physical difficulties,
anxieties and business losses.
The evidence on record does not support the above contentions. We note that there
were two other confirmed passengers who came ahead of the private respondents but
were refused accommodation because they were late. Edmundo Araquel, then the
check-in-clerk, testified on this point, as follows:
Atty. Marcelino C. Calica, counsel for PAL
Q Before the plaintiffs arrive (sic) at the check-in counter, do you recall if
there were other passengers who arrived at the counter and they were advised
that they were late?
A Yes, sir.
Q Who were those persons?
A My former classmates at Ateneo, sir, Rose Capati and Go, Merly.
Q Were these two passengers also confirmed passengers on this flight?
A Yes, sir.
Q I show to you a document which is entitled "Passenger Manifest of flight
264, September 24, 1985," which we request to be marked as Exh. "5" you
said earlier that aside from the plaintiffs here there were two other passengers
who also checked in but they were also late and you mentioned the names of
these passengers as Capati and Go, please point to us that entry which will
show the names of Go and Capati?
A Here, sir, numbers 13 and 14 of the Manifest.
ATTY. CALICA: We request that passengers 13 and 14 be marked in
evidence, Go for 13 and Capati for 14 as Exh. "5-A."
Q You said that these two passengers you mentioned were also similarly
denied accommodations because they checked in late, did they check in
before or after the plaintiffs?
A Before, sir.
Q What time did they appear at the counter?
A 4:01 p.m., sir.
Q What happened when they checked in at 4:01?
A I told them also that they were late so they cannot be accommodated and
they tried to protest, but they decided later on just to refund the ticket. (TSN
of November 23, 1987, pp. 11-12)
Shortly after, the private respondents followed the aforesaid two passengers at
the counter. At this juncture, Araquel declared, thus:
Q Now, you said that you met the plaintiffs in this case because they were
passengers of Flight 264 on September 24, 1985 and they were not
accommodated because they checked in late, what time did these plaintiffs
check in?
A Around 4:02 p.m., sir.
Q Who was the clerk at the check in counter who attended to them?
A I was the one, sir.
x x x           x x x          x x x
Q You said when you were presented the tickets of the plaintiffs in this case
and noting that they were late for checking in, immediately after advising
them that they were late, you said you made annotation on the tickets?
A Yes, sir.
Q I am showing to you Exhs. "A," "B," "C," and "D," which are the tickets of
Mr. & Mrs. Jaime Ramos for Exh. "A," Exh. "B" ticket of Mr. & Mrs. Daniel
Ilano, "C" ticket of Felipa Javalera and "D" ticket of Erlinda Ilano, will you
please go over the same and point to us the notations you said you made on
these tickets?
A This particular time, sir. (Witness pointing to the notation "Late" and the
time "4:02" appearing at the upper righthand of the tickets Exhs. "A," "B,"
"C," and "D.")
Q How long did it take after the tickets were tendered to you for checking in
and before you made this notation?
A It was just seconds, sir.
195
Q On the tickets being tendered for check-in and noting that they were late,
you mean to say you immediately made annotations?
A Yes, sir. That is an S.O.P. of the office.
Q So on what time did you base that 4:02?
A At the check-in counter clock, sir.
Q At the time you placed the time, what was the time reflected at the counter
clock?
A 4:02, sir. (ibid, pp. 8-11)
The private respondents submitted no controverting evidence. As clearly
manifested above, the intervening time between Capati and Go and the private
respondents took only a mere second. If indeed, the private respondents were
at the check-in counter at 3:30 p.m., they could have been the first ones to be
attended to by Araquel than Capati and Go. They cold have also protested if
they were the earliest passengers at the counter but were ignored by Araquel
in favor of Go and Capati. They did not.
It is likewise improbable that not a single PAL personnel was in attendance at
the counter when the check-in counter was supposed to be opened at 3:25
p.m. It mist be remembered that the morning flight to Manila was canceled
and hence, it is not farfetched for Us to believe that the PAL personnel then
have their hands full in dealing with the passengers of the morning flight who
became waitlisted passengers. Moreover, the emphatic assertions of private
respondent Daniel Javalora Ilano regarding the absence of a PAL personnel
lost its impact during the cross examination:
ATTY. CALICA —
Q So, you maintain therefore that for all the time that you waited for there for
the whole twenty (20) minutes the check-in counter and other PAL Offices
there — the whole counter was completely unmanned? I am referring to the
whole area there where it is enclosed by a counter.
I will describe to you, for the benefit of the court.
When you approach the counter at Naga Airport, the counter is enclosed, I
mean, you cannot just go inside the PAL office, right? there is some sort of
counter where you deal with the PAL personnel and you approximate this
counter to be five (5) to six (6) meters. Now, this space after the counter, did
you observe what fixtures or enclosures are contained there inside the
enclosed space?
A I am not sure whether there are offices or enclosures there.
Q You have been traveling and had opportunity to check-in your tickets so
may times. Everytime that you check-in, how many personnel are manning
the check-in counter?
A There are about three (3) or four (4), sir.
Q Everytime, there are three (3) or four (4)?
A Everytime but not that time.
Q I am referring to your previous trips, I am not referring to this incident.
On previous occasions when you took the flight with Pili Airport and you see
three (3) or four (4) personnel everytime, are all these three (3) or four (4)
personnel at the counter or some are standing at the counter or others are
seated on the table doing something or what? Will you describe to us?
A Some are handling the baggages and some are checking-in the tickets.
Q So, on most occasions when you check-in and say, there were at least three
(3) of four (4) people at the check-in counter, one would attend to the tickets,
another to the check in baggage, if any. Now, do you notice if somebody
evade when you check-in your ticket. This other person would receive the
flight coupon which is detached from your ticket and record it on what we call
passenger manifest?
A That's true.
Q Now, it is clear one would attend to the baggage, another person would
receive the ticket, detach the coupon and one would record it on the passenger
manifest. What about the fourth, what was he doing, if you recall?
A I think, putting the identification tags on the baggages (sic). (TSN,
November 17, 1986, p. 38)
Ilano's declaration becomes even more patently unreliable in the face of the
Daily Station Report of PAL dated September 24, 1985 which contained the
working hours of its personnel from 0600 to 1700 and their respective
assignments, as follows:
ATTY. CALICA
Q Normally upon opening of the check-in counter, how many PAL personnel
are assigned to man the counter?
EDMUNDO ARAQUEL
196
A A total of four personnel with the assistance of others.
Q Who are these personnel are assigned to the counter and what specific
duties they performed?
A Mr. Oropesa handled the cargo, Mr. Espiritu handled the ticketing, Mr.
Valencia and me handled the checking in of passengers.
Q Are you referring to this particular flight 264 on September 24, 1985?
A Yes, sir.
Q Who was assigned as check-in clerk that particular time?
A I was the one with Mr. Valencia, sir.
Q What was Mr. Valencia doing?
A He assisted me, sir.
Q How?
A If a group of passengers simultaneously check in, we divided the work
between us. (TSN, November 23, 1987, p. 7)
x x x           x x x          x x x
Q When the plaintiffs testified in this case particularly plaintiff Daniel Ilano
and Felipa Javalera at the previous hearings said plaintiffs stated that they
arrived at the check-in counter at about 3:25 or 3:30 and there was nobody in
the counter, what can you say to that?
A We cannot leave the counter, sir. That was always manned from 3:25 up to
the last minute. We were there assigned to handle the checking in of the
passengers.
Q You mentioned earlier that aside from you there were other personnel
assigned to the check-in counter and you even mentioned about a certain
Valencia assisting you, do you have any evidence to show said assignment of
personnel at the airport?
A Yes, sir.
Q I show to you a daily station report from 24 September 1985 covering
working hours 0600 to 1700, will you please go over the same and thereafter
tell us from the personnel listed in this Daily Station Report what were the
name (sic) of the personnel assigned to man a check-in counter at that time?
A There (sic) persons assigned were Mr. Oropesa, Mr. Espiritu, Mr.
Medevilla, myself and Mr. Valencia.
Q You mentioned about Mr. Espiritu, what was his specific task at that time?
A He was handling the ticketing, sir.
Q What about Mr. Medevilla?
A He was taking care of the ramp handling.
Q And Mr. Oropesa?
A He was handling the incoming cargo.
ATTY. CALICA: We request that this Daily Station Report be marked Exh.
"6" and the portion of the Report which shows the deployment of personnel of
PAL Naga Station on September 24, 1985 as "6-A."
Q Plaintiffs in this case testified that when they checked in there was nobody
manning the counter and they had to wait for twenty minutes before someone
came in to the counter, what can you say to that?
A It is not true because all the time we were there from the start, an hour
before the flight we were there because we were assigned there.
Q Plaintiff Daniel Ilano testified that he went to the counter twice, first at 3:25
and it was only at 4:00 p.m. that somebody went to the counter and attended
to him and while he expected his boarding pass he was told instead that
plaintiffs could not be accommodated because they were late, what can you
say to that?
A The truth is we were always there and we never left the counter from the
start of the check-in time of 3:25 we were all there, we never left the counter.
Q Until what time did you remain at the check-in counter?
A At around 4:15 p.m., sir.
Q You said that the check-in counter was closed at 3:55, for what purpose
were you still manning the check-in counter?
A To attend to the passenger who are late in checking in because they also
need assistance in explaining to them the situation.
Q So it was for that purpose you were there?
A Yes, sir. (ibid., pp. 16-18)
197
It is significant to note that there were no other passenger who checked-in late after the passengers have already boarded, there was no sense in keeping them waiting for the
private respondents (TSN, November 23, 1987, p. 13). In the absence of any scheduled time of departure before the plane could take flight.
controverting evidence, the documentary evidence presented to corroborate the
testimonies of PAL's witnesses are prima facie evidence of the truth of their ACCORDINGLY, the petition is GRANTED. The questioned decision of the Court of
allegations. The plane tickets of the private respondents, exhs. "1," "2," "3," "4," (with Appeals dated March 15, 1990 is hereby ANNULLED and SET ASIDE. No costs.
emphasis on the printed condition of the contract of carriage regarding check-in time SO ORDERED.
as well as on the notation "late 4:02" stamped on the flight coupon by the check-in
clerk immediately upon the check-in of private respondents) and the passenger Note.—A statement need not be in writing to be admissible as part of the res gestae.
Manifest of Flight PR 264, exh. "5," (which showed the non-accommodation of Capati (Medios vs. Court of Appeals, 169 SCRA 838.) Philippine Airlines, Inc. vs. Ramos,
and Go an the private respondents)are entries made in the regular course of business 207 SCRA 461, G.R. No. 92740 March 23, 1992
which the private respondents failed to overcome with substantial and convincing
evidence other than their testimonies. Consequently, they carry more weight and
credence. A writing or document made contemporaneously with a transaction in which
are evidenced facts pertinent to an issue, when admitted as proof of those facts, is
ordinarily regarded as more reliable proof and of greater probative force than the oral
testimony of a witness as to such facts based upon memory and recollection (20 Am
Jur S 1179, 1029 cited in Francisco, Revised Rules of Court in the Philippines
Annotated, 1973 Edition, Volume VII, Part II, p. 654). Spoken words could be
notoriously unreliable as against a written document that speaks a uniform language
(Spouses Vicente and Salome de Leon v. CA., et al., G.R. No. 95511, January 30,
1992). This dictum is amply demonstrated by the diverse allegations of the private
respondents in their complaint (where they claimed that no one was at the counter until
thirty (30) minutes before the published departure time and that the employee who
finally attended to them marked them late, Records, p. 2) and in their testimonies
(where they contended that there were two different PAL personnel who attended to G.R. No. 140023. August 14, 2003
them at the check-in counter. TSNs of November 17, 1986, pp. 41-45 and of May 18, RUDY LAO, petitioner, vs. STANDARD INSURANCE CO., INC., respondent.
1987, pp. 5-6). Private respondents' only objection to these documents is that they are
self-serving cannot be sustained. The hearsay rule will not apply in this case as Evidence: Documentary Evidence; Police Blotter; A police blotter is admissible if the
statements, acts or conduct accompanying or so nearly connected with the main following requisites are met.—The police blotter was admitted under Rule 130,
transaction as to form a part of it, and which illustrate, elucidate, qualify or Section 44 of the Rules of Court. Under the said rule, the following are the requisites
characterize the act, are admissible as apart of the res gestae (32 C.J.S., S. 411, 30-31). for its admissibility: (a) that the entry was made by a public officer, or by another
Based on these circumstances, We are inclined to believe the version of PAL. When person, specially enjoined by law to do so; (b) that it was made by the public officer in
the private respondents purchased their tickets, they were instantaneously bound by the the performance of his duties, or by such other person in the performance of a duty
conditions of the contract of carriage particularly the check-in time requirement. The specially enjoined by law; (c) that the public officer or other person had sufficient
terms of the contract are clear. Their failure to come on time for check-in should not knowledge of the facts by him stated, which must have been acquired by him
militate against PAL. Their non-accommodation on that flight was the result of their personally or through official information.
own action or inaction and the ensuing cancellation of their tickets by PAL is only
proper. Damages: Exemplary Damages; Although exemplary damages cannot be recovered as
a matter of right, they also need not be proved.—Although exemplary damages cannot
Furthermore, We do not find anything suspicious in the fact that PAL flight 264 be recovered as a matter of right, they also need not be proved. But a complainant must
departed at 4:13 p.m. instead of 4:25 p.m. Apart from their verbal assertions, the still show that he is entitled to moral, temperate or compensatory damages before the
private respondents did not show any evidence of irregularity. It being clear that all the court may consider the question of whether or not exemplary damages should be

198
awarded. Lao vs. Standard Insurance Co., Inc., 409 SCRA 43, G.R. No. 140023
August 14, 2003
The instant petition seeks the reversal of the Court of Appeals’ Decision 1 dated
February 4, 1999, as well as its Resolution, 2 dated September 7, 1999, in CA-G.R.
CV No. 47227. The assailed decision dismissed petitioner’s appeal and the resolution
denied petitioner’s motion for reconsideration.
The original action was lodged before the Regional Trial Court of Iloilo City, Branch
25, as Civil Case No. 17045 for breach of contract and damages, as a result of the
insurance company’s refusal of petitioner’s claim on the insurance policy of his truck
which figured in an accident during the effectivity of the policy.
The following are the antecedent facts:
Petitioner Rudy Lao is the owner of a Fuso truck with Plate No. FCG-538. The truck
was insured with respondent Standard Insurance Co., Inc. under Policy No. CV-21074
3 for the maximum amount of P200,000 and an additional sum of P50,000 to cover any
damages that might be caused to his goods.
While the policy was in effect, an accident occurred. At around 8:00 p.m. of April 24,
1985, in Barangay Buhang, Jaro, Iloilo City, the insured truck bumped another truck,
with Plate No. FBS-917, also owned by petitioner Lao. The latter truck was running
ahead of the insured truck and was bumped from the rear. The insured truck sustained
damages estimated to be around P110,692, while the damage to the other truck and to
properties in the vicinity of the accident, were placed at P35,000 more or less.
Petitioner filed a claim with the insurance company for the proceeds from his policy.
However, the claim was denied by the insurance company on the ground that when its
adjuster went to investigate the matter, it was found that the driver of the insured truck,
Leonardo Anit, did not possess a proper driver’s license at the time of the accident.
The restriction 4 in Leonardo Anit’s driver’s license provided that he can only drive
four-wheeled vehicles weighing not more than 4,500 kgs. Since the insured truck he
was driving weighed more than 4,500 kgs., he therefore violated the "authorized
driver" clause 5 of the insurance policy. In addition, respondent cited the following
excerpts from the police blotter of the Iloilo INP, to wit:
C-UN-85 DAMAGE TO PROPERTY W/ PHY INJURIES — R/IMPRUDENCE
11:30 PM — Sgt. A. Bernas informed this office that a collision took place at Brgy.
Buhang, Jaro, IC. Investigation conducted by Pat. Villahermosa, assisted by Lt. P.
Baclaron (OD), disclosed that at about 8:00 PM this date at the aforementioned place, a
collision took place between a truck (Hino) with Plate Nr FB[S] 917 owned by Rudy
Lao and driven by BOY GIDDIE Y COYEL, 38 yrs, a res. of Balasan, Iloilo, with
License Nr DLR 1108142 and another truck with Plate Nr. FCG-538 owned by Rudy
Lao and driver (sic) by LEONARDO ANIT Y PANES, 33 yrs, a res. of Brgy Laya,
Balasan, Iloilo with License Nr 1836482.
Petitioner claims that at the time of the accident, it was in fact another driver named
Giddie Boy Y Coyel who was driving the insured truck. Giddie Boy possessed a
driver’s license authorizing him to drive vehicles such as the truck which weighed
more than 4,500 kgs. As evidence, petitioner presented the Motor Vehicle Accident
Report 7 wherein the Investigating Officer, Pat. Felipe D. Villahermosa, stated that it
was Giddie Boy driving the insured truck and not Leonardo Anit. The said report was
made three days after the accident or on April 27, 1985. However, respondent
insurance company was firm in its denial of the claim.
Hence, petitioner filed the civil case before the RTC. After trial, the court disposed of
the case as follows:chanrob1es virtual 1aw library
WHEREFORE, premises considered, the Court finds that plaintiff lacks sufficient
cause of action against the defendant and hence ordered his case dismissed and further
orderes (sic) him to pay the defendant the following:
1) P20,000.00 as attorney’s fees plus P500.00 for appearance fee; and
2) P50,000.00 as exemplary damages.
SO ORDERED.
On appeal with the Court of Appeals, the RTC decision was affirmed. The petition was
dismissed and the motion for reconsideration was denied. The CA stated:chanrob1es
virtual 1aw library
IN VIEW OF THE FOREGOING, the decision appealed from is hereby AFFIRMED.
Consequently, the complaint is DISMISSED for lack of merit.
SO ORDERED. 9 
In his petition for review now before us, petitioner cites the following as grounds
therefor:chanrob1es virtual 1aw library
A. THE HONORABLE COURT OF APPEALS AND THE LOWER COURT
RELIED MAINLY ON SECTION 44, RULE 130 OF THE RULES OF COURT IN
UPHOLDING THE ENTRY IN THE POLICE BLOTTER WHICH STATED THAT
THE DRIVER OF THE INSURED VEHICLE WAS LEONARDO ANIT Y PANES,
WHO WAS NOT AN AUTHORIZED DRIVER. UNDER THE SAID SECTION 44,
RULE 130 ITSELF HOWEVER, THE POLICE BLOTTER IS MERELY A PRIMA
199
FACIE EVIDENCE OF THE FACTS STATED THEREIN WHICH MAY BE
NULLIFIED BY OTHER EVIDENCE; 10 
B. PERCEPTION OF THE HONORABLE COURT OF APPEALS’ ON THE
"DIMINISHED" CREDIBILITY OF PAT. FELIPE VILLAHERMOSA, THE
TRAFFIC POLICE INVESTIGATOR, IS MISPLACED AND UNFOUNDED; 11 
C. THE DRIVER OF THE INSURED TRUCK WITH PLATE NR. FCG-538 WAS
GIDDIE BOY Y COYEL, AN AUTHORIZED DRIVER OF THE SAID TRUCK.
THE DRIVER OF THE OTHER TRUCK INVOLVED IN THE ACCIDENT WITH
PLATE NR. FBS-917 WAS LEONARDO ANIT Y PANES; 12  other person in the performance of a duty specially enjoined by law;
D. THE HONORABLE COURT OF APPEALS MISAPPLIED ARTICLES 2232
AND 2208 OF THE NEW CIVIL CODE IN GRANTING EXEMPLARY DAMAGES
AND ATTORNEY’S FEES TO RESPONDENT. UNDER ARTICLES 2229 AND
2234 OF THE NEW CIVIL CODE, EXEMPLARY DAMAGES CANNOT BE
AWARDED IN THE ABSENCE OF AN AWARD FOR MORAL, TEMPERATE,
LIQUIDATED OR COMPENSATORY DAMAGES; 13  properly admitted as they form part of official records. 20 Entries in police records
E. TESTIMONIES OF THE WITNESSES OF RESPONDENT NAMELY, SGT.
BERNAS, THE DESK OFFICER AND ROMEO GUIERGEN, INSURANCE
ADJUSTER, WERE INCONSISTENT AND UNRELIABLE; 14 and
F. THE HONORABLE COURT OF APPEALS UPHELD THE DECISION OF THE
LOWER COURT DESPITE GLARING MISAPPLICATION OF THE LAW AND
JURISPRUDENCE ESTABLISHED BY THIS HONORABLE SUPREME COURT
AS WELL AS CLEAR MISAPPREHENSION OF THE FACTS IN THIS CASE. 15  truck with plate number FCG-538. This is unlike People v. Mejia, 22 where we said
Three issues must be resolved: (1) The admissibility and probative value of the police
blotter as evidence; (2) The assessment of the credibility of witnesses; and (3) The
propriety and basis of the awards for exemplary damages and attorney’s fees. Also
pertinent here is the factual issue of whether or not Leonardo Anit, an unauthorized
driver, was driving the insured truck at the time of the accident.
Petitioner assails the admissibility and evidentiary weight given to the police blotter, as
a basis for the factual finding of the RTC and the CA. He contends that the same entry
was belied by the Motor Vehicle Accident Report and testimony of the investigating
policeman himself, attesting that it was Giddie Boy Coyel, not Leonardo Anit, who
was driving the insured vehicle. 16  Petitioner also assails the credence given by the trial court to the version of the
Respondent avers that the same police report and testimony were of dubious nature.
Both trial and appellate courts noted that the report was made three days after the
accident and did not form part of the official police records. 17 
The police blotter was admitted under Rule 130, Section 44 of the Rules of Court. 18
Under the said rule, the following are the requisites for its admissibility:chanrob1es
virtual 1aw library
(a) that the entry was made by a public officer, or by another person, specially enjoined
by law to do so;
(b) that it was made by the public officer in the performance of his duties, or by such
(c) that the public officer or other person had sufficient knowledge of the facts by him
stated, which must have been acquired by him personally or through official
information. 19 
We agree with the trial and appellate courts in finding that the police blotter was
made by a police officer in the performance of the duty especially enjoined by law are
prima facie evidence of the fact therein stated, and their probative value may be either
substantiated or nullified by other competent evidence. 21 Although police blotters are
of little probative value, they are nevertheless admitted and considered in the absence
of competent evidence to refute the facts stated therein.
In this case, the entries in the police blotter reflected the information subject of the
controversy. Stated therein was the fact that Leonardo Anit was driving the insured
that "entries in the police blotters should not be given undue significance or probative
value," since the Court there found that "the entries in question are sadly wanting in
material particulars" .
Furthermore, in this case the police blotter was identified and formally offered as
evidence. The person who made the entries was likewise presented in court; he
identified and certified as correct the entries he made on the blotter. The information
was supplied to the entrant by the investigating officer who did not protest about any
inaccuracy when the blotter was presented to him. No explanation was likewise given
by the investigating officer for the alleged interchange of names.
respondents vis-a-vis the testimonies of the witnesses. Time and again we have
reiterated the settled doctrine that great weight, and even finality, is given to the factual
conclusions of the Court of Appeals which affirm those of the trial courts. 23 We find
200
on this score no reason to overturn such conclusions.
On the issue of damages, we agree with petitioner that the award of exemplary
damages was improper. In Tiongco v. Atty. Deguma 24 we held that the entitlement to
the recovery of exemplary damages must be shown. In the case at bar, respondent have
not shown sufficient evidence that petitioner indeed schemed to procure the dubious
documents and lied through his teeth to establish his version of the facts. What was
found was that the document he presented was inadmissible, and its contents were
dubious. However, no proof was adduced to sufficiently establish that it came to his
hands through his employment of underhanded means. In Tiongco, we further stated:
Although exemplary damages cannot be recovered as a matter of right, they also need
not be proved. But a complainant must still show that he is entitled to moral, temperate
or compensatory damages before the court may consider the question of whether or not
exemplary damages should be awarded.25cralaw:red
Thus, it was error for the courts below to award exemplary damages in the absence of
any award for moral, temperate or compensatory damages.
The award of attorney’s fees must also be deleted. Such award was given in its
extraordinary concept as indemnity for damages to be paid by the losing party to the
prevailing party. 26 But it was not sufficiently shown that petitioner acted maliciously
in instituting the claim for damages. Perforce, the award of attorney’s fees was
improper.
WHEREFORE, the assailed Decision and Resolution of the Court of Appeals are
AFFIRMED, with the MODIFICATION that the award of exemplary damages and
attorney’s fees is hereby DELETED. No pronouncement as to costs.
SO ORDERED
Note.—The testimonies of the three police officers carry with it the presumption of
regularity in the performance of official functions. (People vs. Barita, 325 SCRA 22
[2000]) Lao vs. Standard Insurance Co., Inc., 409 SCRA 43, G.R. No. 140023 August
14, 2003
G.R. No. 127598. February 22, 2000.
MANILA ELECTRIC COMPANY, petitioner, vs. Hon. SECRETARY of
LABOR LEONARDO QUISUMBING and MERALCO EMPLOYEES and
WORKERS ASSOCIATION (MEWA), respondents.
Labor Law; Collective Bargaining Agreements; Public Utilities; An increase in the
prices of electric current needs the approval of the appropriate regulatory government
agency and does not automatically result from a mere increase in the wages of the
public utility firm’s employees.—–Petitioner warns that if the wage increase of
P2,200.00 per month as ordered by the Secretary is allowed, it would simply pass the
cost covering such increase to the consumers through an increase in the rate of
electricity. This is a non sequitur. The Court cannot be threatened with such a
misleading argument. An increase in the prices of electric current needs the approval of
the appropriate regulatory government agency and does not automatically result from a
mere increase in the wages of petitioner’s employees. Besides, this argument
presupposes that petitioner is capable of meeting a wage increase.
Same; Same; Evidence; Commercial Lists; A mere newspaper account is not
considered a commercial list—it is at most an analysis or opinion which carries no
persuasive weight in determining the rate of wage increase.—–Under the afore-quoted
rule, statement of matters contained in a periodical may be admitted only “if that
compilation is published for use by persons engaged in that occupation and is generally
used and relied upon by them therein.” As correctly held in our Decision dated January
27, 1999, the cited report is a mere newspaper account and not even a commercial list.
At most, it is but an analysis or opinion which carries no persuasive weight for
purposes of this case as no sufficient figures to support it were presented. Neither did
anybody testify to its accuracy. It cannot be said that businessmen generally rely on
news items such as this in their occupation. Besides, no evidence was presented that
the publication was regularly prepared by a person in touch with the market and that it
is generally regarded as trustworthy and reliable. Absent extrinsic proof of their
accuracy, these reports are not admissible. In the same manner, newspapers containing
stock quotations are not admissible in evidence when the source of the reports is
available. With more reason, mere analyses or projections of such reports cannot be
admitted. In particular, the source of the report in this case can be easily made
available considering that the same is necessary for compliance with certain
governmental requirements.
In the Decision promulgated on January 27, 1999, the Court disposed of the case as
follows:
WHEREFORE, the petition is granted and the orders of public respondent Secretary of
Labor dated August 19, 1996 and December 28, 1996 are set aside to the extent set
forth above. The parties are directed to execute a Collective Bargaining Agreement
incorporating the terms and conditions contained in the unaffected portions of the
Secretary of Labor's orders of August 19, 1996 and December 28, 1996, and the
modifications set forth above. The retirement fund issue is remanded to the Secretary
of Labor for reception of evidence and determination of the legal personality of the
MERALCO retirement fund.1
201
The modifications of the public respondent's resolutions include the following: (FLAMES2) of petitioner corporation alleging that it has bona fide legal interest in the
outcome of the case.3 The Court required the "proper parties" to file a comment to the
Secretary's three motions for reconsideration but the Solicitor-General asked that he be excused
January 27, 1999 decision
resolution from filing the comment because the "petition filed in the instant case was granted" by
the Court.4 Consequently, petitioner filed its own consolidated comment. An "Appeal
Wages - P1,900.00 for 1995-96 P2,200.00 Seeking Immediate Reconsideration" was also filed by the alleged newly elected
president of the Union.5 Other subsequent pleadings were filed by the parties and
X'mas bonus - modified to one month 2 months intervenors.

The issues raised in the motions for reconsideration had already been passed upon by
Retirees - remanded to the Secretary granted the Court in the January 27, 1999 decision. No new arguments were presented for
consideration of the Court. Nonetheless, certain matters will be considered herein,
Loan to coops - denied granted particularly those involving the amount of wages and the retroactivity of the Collective
Bargaining Agreement (CBA) arbitral awards.
GHSIP, HMP and 
Petitioner warns that if the wage increase of P2,200.00 per month as ordered by the
Housing loans - granted up to P60,000.00 granted
Secretary is allowed, it would simply pass the cost covering such increase to the
consumers through an increase in the rate of electricity. This is a non sequitur. The
Signing bonus - denied granted Court cannot be threatened with such a misleading argument. An increase in the prices
of electric current needs the approval of the appropriate regulatory government agency
Union leave - 40 days (typo error) 30 days and does not automatically result from a mere increase in the wages of petitioner's
employees. Besides, this argument presupposes that petitioner is capable of meeting a
High voltage/pole - not apply to those who are  members of a team wage increase. The All Asia Capital report upon which the Union relies to support its
not exposed to the risk position regarding the wage issue cannot be an accurate basis and conclusive
determinant of the rate of wage increase. Section 45 of Rule 130 Rules of Evidence
Collectors - no need for cash bond, no  provides:
need to reduce quota and
Commercial lists and the like. — Evidence of statements of matters of interest to
MAPL
persons engaged in an occupation contained in a list, register, periodical, or other
published compilation is admissible as tending to prove the truth of any relevant matter
CBU - exclude confidential employees include so stated if that compilation is published for use by persons engaged in that occupation
and is generally used and relied upon by them therein.
Union security - maintenance of membership closed shop
Under the afore-quoted rule, statement of matters contained in a periodical, may be
admitted only "if that compilation is published for use by persons engaged in that
Contracting out - no need to consult union consult first
occupation and is generally used and relied upon by them therein." As correctly held in
our Decision dated January 27, 1999, the cited report is a mere newspaper account and
All benefits - existing terms and conditions all terms not even a commercial list. At most, it is but an analysis or opinion which carries no
persuasive weight for purposes of this case as no sufficient figures to support it were
Retroactivity - Dec. 28, 1996-Dec. 27, 199(9) from Dec. 1, 1995 presented. Neither did anybody testify to its accuracy. It cannot be said that
businessmen generally rely on news items such as this in their occupation. Besides, no
Dissatisfied with the Decision, some alleged members of private respondent union evidence was presented that the publication was regularly prepared by a person in
(Union for brevity) filed a motion for intervention and a motion for reconsideration of touch with the market and that it is generally regarded as trustworthy and reliable.
the said Decision. A separate intervention was likewise made by the supervisor's union Absent extrinsic proof of their accuracy, these reports are not admissible. 6 In the same
202
manner, newspapers containing stock quotations are not admissible in evidence when
the source of the reports is available. 7 With more reason, mere analyses or projections
of such reports cannot be admitted. In particular, the source of the report in this case
can be easily made available considering that the same is necessary for compliance
with certain governmental requirements.
Nonetheless, by petitioner's own allegations, its actual total net income for 1996 was
P5.1 billion.8 An estimate by the All Asia financial analyst stated that petitioner's net
operating income for the same year was about P5.7 billion, a figure which the Union
relies on to support its claim. Assuming without admitting the truth thereof, the figure
is higher than the P4.171 billion allegedly suggested by petitioner as its projected net
operating income. The P5.7 billion which was the Secretary's basis for granting the
P2,200.00 is higher than the actual net income of P5.1 billion admitted by petitioner. It
would be proper then to increase this Court's award of P1,900.00 to P2,000.00 for the
two years of the CBA award. For 1992, the agreed CBA wage increase for rank-and-
file was P1,400.00 and was reduced to P1,350.00; for 1993; further reduced to
P1,150.00 for 1994. For supervisory employees, the agreed wage increase for the years
1992-1994 are P1,742.50, P1,682.50 and P1,442.50, respectively. Based on the
foregoing figures, the P2,000.00 increase for the two-year period awarded to the rank-
and-file is much higher than the highest increase granted to supervisory
employees.9 As mentioned in the January 27, 1999 Decision, the Court does "not seek
to enumerate in this decision the factors that should affect wage determination"
because collective bargaining disputes particularly those affecting the national interest
and public service "requires due consideration and proper balancing of the interests of
the parties to the dispute and of those who might be affected by the dispute." 10 The
Court takes judicial notice that the new amounts granted herein are significantly higher
than the weighted average salary currently enjoyed by other rank-and-file employees
within the community. It should be noted that the relations between labor and capital is
impressed with public interest which must yield to the common good. 11 Neither party
should act oppressively against the other or impair the interest or convenience of the
public.12Besides, matters of salary increases are part of management prerogative. 13
On the retroactivity of the CBA arbitral award, it is well to recall that this petition had
its origin in the renegotiation of the parties' 1992-1997 CBA insofar as the last two-
year period thereof is concerned. When the Secretary of Labor assumed jurisdiction
and granted the arbitral awards, there was no question that these arbitral awards were
to be given retroactive effect. However, the parties dispute the reckoning period when
retroaction shall commence. Petitioner claims that the award should retroact only from
such time that the Secretary of Labor rendered the award, invoking the 1995 decision
in Pier 8 case14 where the Court, citing Union of Filipino Employees v. NLRC,15 said:
The assailed resolution which incorporated the CBA to be signed by the parties was
promulgated on June 5, 1989, the expiry date of the past CBA. Based on the provision
of Section 253-A, its retroactivity should be agreed upon by the parties. But since no
agreement to that effect was made, public respondent did not abuse its discretion in
giving the said CBA a prospective effect. The action of the public respondent is within
the ambit of its authority vested by existing law.
On the other hand, the Union argues that the award should retroact to such time
granted by the Secretary, citing the 1993 decision of St. Luke's.16
Finally, the effectivity of the Order of January 28, 1991, must retroact to the date of the
expiration of the previous CBA, contrary to the position of petitioner. Under the
circumstances of the case, Article 253-A cannot be properly applied to herein case. As
correctly stated by public respondent in his assailed Order of April 12, 1991 dismissing
petitioner's Motion for Reconsideration —
Anent the alleged lack of basis for the retroactivity provisions awarded; we would
stress that the provision of law invoked by the Hospital, Article 253-A of the Labor
Code, speaks of agreements by and between the parties, and not arbitral awards . . .
Therefore, in the absence of a specific provision of law prohibiting retroactivity of the
effectivity of arbitral awards issued by the Secretary of Labor pursuant to Article
263(g) of the Labor Code, such as herein involved, public respondent is deemed vested
with plenary and discretionary powers to determine the effectivity thereof.
In the 1997 case of Mindanao Terminal, 17 the Court applied the St. Luke's doctrine and
ruled that:
In St. Luke's Medical Center v. Torres, a deadlock also developed during the CBA
negotiations between management and the union. The Secretary of Labor assumed
jurisdiction and ordered the retroaction of the CBA to the date of expiration of the
previous CBA. As in this case, it was alleged that the Secretary of Labor gravely
abused its discretion in making his award retroactive. In dismissing this contention this
Court held:
Therefore, in the absence of a specific provision of law prohibiting retroactive of the
effectivity of arbitral awards issued by the Secretary of Labor pursuant to Article
263(g) of the Labor Code, such as herein involved, public respondent is deemed vested
with plenary and discretionary powers to determine the effectivity thereof.
The Court in the January 27, 1999 Decision, stated that the CBA shall be "effective for
a period of 2 years counted from December 28, 1996 up to December 27, 1999."
Parenthetically, this actually covers a three-year period. Labor laws are silent as to
when an arbitral award in a labor dispute where the Secretary had assumed jurisdiction
by virtue of Article 263 (g) of the Labor Code shall retroact. In general, a CBA
negotiated within six months after the expiration of the existing CBA retroacts to the
day immediately following such date and if agreed thereafter, the effectivity depends
203
on the agreement of the parties. 18 On the other hand, the law is silent as to the
retroactivity of a CBA arbitral award or that granted not by virtue of the mutual
agreement of the parties but by intervention of the government. Despite the silence of
the law, the Court rules herein that CBA arbitral awards granted after six months from
the expiration of the last CBA shall retroact to such time agreed upon by both
employer and the employees or their union. Absent such an agreement as to
retroactivity, the award shall retroact to the first day after the six-month period
following the expiration of the last day of the CBA should there be one. In the absence
of a CBA, the Secretary's determination of the date of retroactivity as part of his
discretionary powers over arbitral awards shall control.
It is true that an arbitral award cannot per se be categorized as an agreement
voluntarily entered into by the parties because it requires the interference and imposing
power of the State thru the Secretary of Labor when he assumes jurisdiction. However,
the arbitral award can be considered as an approximation of a collective bargaining
agreement which would otherwise have been entered into by the parties. 19 The terms or
periods set forth in Article 253-A pertains explicitly to a CBA. But there is nothing that
would prevent its application by analogy to an arbitral award by the Secretary
considering the absence of an applicable law. Under Article 253-A: "(I)f any such
agreement is entered into beyond six months, the parties shall agree on the duration of
retroactivity thereof." In other words, the law contemplates retroactivity whether the
agreement be entered into before or after the said six-month period. The agreement of
the parties need not be categorically stated for their acts may be considered in
determining the duration of retroactivity. In this connection, the Court considers the
letter of petitioner's Chairman of the Board and its President addressed to their
stockholders, which states that the CBA "for the rank-and-file employees covering the
period December 1, 1995 to November 30, 1997 is still with the Supreme Court," 20 as
indicative of petitioner's recognition that the CBA award covers the said period.
Earlier, petitioner's negotiating panel transmitted to the Union a copy of its proposed
CBA covering the same period inclusive. 21 In addition, petitioner does not dispute the
allegation that in the past CBA arbitral awards, the Secretary granted retroactivity
commencing from the period immediately following the last day of the expired CBA.
Thus, by petitioner's own actions, the Court sees no reason to retroact the subject CBA
awards to a different date. The period is herein set at two (2) years from December 1,
1995 to November 30, 1997.
On the allegation concerning the grant of loan to a cooperative, there is no merit in the
union's claim that it is no different from housing loans granted by the employer. The
award of loans for housing is justified because it pertains to a basic necessity of life. It
is part of a privilege recognized by the employer and allowed by law. In contrast,
providing seed money for the establishment of the employee's cooperative is a matter
in which the employer has no business interest or legal obligation. Courts should not
be utilized as a tool to compel any person to grant loans to another nor to force parties
to undertake an obligation without justification. On the contrary, it is the government
that has the obligation to render financial assistance to cooperatives and the
Cooperative Code does not make it an obligation of the employer or any private
individual.22
Anent the 40-day union leave, the Court finds that the same is a typographical error. In
order to avoid any confusion, it is herein declared that the union leave is only thirty
(30) days as granted by the Secretary of Labor and affirmed in the Decision of this
Court.
The added requirement of consultation imposed by the Secretary in cases of
contracting out for six (6) months or more has been rejected by the Court. Suffice it to
say that the employer is allowed to contract out services for six months or more.
However, a line must be drawn between management prerogatives regarding business
operations per se and those which affect the rights of employees, and in treating the
latter, the employer should see to it that its employees are at least properly informed of
its decision or modes of action in order to attain a harmonious labor-management
relationship and enlighten the workers concerning their rights.23Hiring of workers is
within the employer's inherent freedom to regulate and is a valid exercise of its
management prerogative subject only to special laws and agreements on the matter and
the fair standards of justice. 24 The management cannot be denied the faculty of
promoting efficiency and attaining economy by a study of what units are essential for
its operation. It has the ultimate determination of whether services should be
performed by its personnel or contracted to outside agencies. While there should be
mutual consultation, eventually deference is to be paid to what management
decides.25 Contracting out of services is an exercise of business judgment or
management prerogative.26 Absent proof that management acted in a malicious or
arbitrary manner, the Court will not interfere with the exercise of judgment by an
employer.27 As mentioned in the January 27, 1999 Decision, the law already
sufficiently regulates this matter. 28 Jurisprudence also provides adequate limitations,
such that the employer must be motivated by good faith and the contracting out should
not be resorted to circumvent the law or must not have been the result of malicious or
arbitrary actions.29These are matters that may be categorically determined only when
an actual suit on the matter arises.
WHEREFORE, the motion for reconsideration is PARTIALLY GRANTED and the
assailed Decision is MODIFIED as follows: (1) the arbitral award shall retroact from
December 1, 1995 to November 30, 1997; and (2) the award of wage is increased from
the original amount of One Thousand Nine Hundred Pesos (P1,900.00) to Two
Thousand Pesos (P2,000.00) for the years 1995 and 1996. This Resolution is subject to
the monetary advances granted by petitioner to its rank-and-file employees during the
pendency of this case assuming such advances had actually been distributed to them.
The assailed Decision is AFFIRMED in all other respects.
204
SO ORDERED.
G.R. Nos. 115338-39. September 16, 1997.
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. LANIE ORTIZ-
MIYAKE, accused-appellant.
Labor Law; Criminal Law; Illegal Recruitment; Words and Phrases; “Recruitment and
Placement,” Defined.—The Labor Code defines recruitment and placement as “x x x
any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring
workers and includes referrals, contract services, promising or advertising for
employment, locally or abroad, whether for profit or not x x x.”
Same; Same; Same; Republic Act No. 8042 (Migrant Workers and Overseas Filipinos
Act of 1995); Ex Post Facto Laws; R.A. No. 8042 does not apply to an offense
committed before its effectivity.—During the pendency of this case, Republic Act No.
8042, otherwise known as the “Migrant Workers and Overseas Filipinos Act of 1995,”
was passed increasing the penalty for illegal recruitment. This new law, however, does
not apply to the instant case because the offense charged herein was committed in
1992, before the effectivity of said Republic Act No. 8042. Hence, what are applicable
are the aforecited Labor Code provisions.
Same; Same; Same; In illegal recruitment cases, the number of persons victimized is
determinative.—It is evident that in illegal recruitment cases, the number of persons
victimized is determinative. Where illegal recruitment is committed against a lone
victim, the accused may be convicted of simple illegal recruitment which is punishable
with a lower penalty under Article 39(c) of the Labor Code. Corollarily, where the
offense is committed against three or more persons, it is qualified to illegal recruitment
in large scale which provides a higher penalty under Article 39(a) of the same Code.
Same; Same; Same; Right of Confrontation; The right of confrontation has two
purposes: first, to secure the opportunity of cross-examination; and, second, to allow
the judge to observe the deportment and appearance of the witness while testifying.—
Under the aforecited rules, the accused in a criminal case is guaranteed the right of
confrontation. Such right has two purposes: first, to secure the opportunity of cross-
examination; and, second, to allow the judge to observe the deportment and appearance
of the witness while testifying.
Same; Same; Same; Same; Hearsay Rule; The right of confrontation is not absolute as
it is recognized that it is sometimes impossible to recall or produce a witness who has
already testified in a previous proceeding, in which event his previous testimony is
made admissible as a distinct piece of evidence, by way of exception to the hearsay
rule.—This right, however, is not absolute as it is recognized that it is sometimes
impossible to recall or produce a witness who has already testified in a previous
proceeding, in which event his previous testimony is made admissible as a distinct
piece of evidence, by way of exception to the hearsay rule. The previous testimony is
made admissible because it makes the administration of justice orderly and
expeditious.
Same; Same; Same; Same; Same; Judgments; The exception to the right of
confrontation contemplated by law covers only the utilization of testimonies of absent
witnesses made in previous proceedings, and does not include utilization of previous
decisions or judgments.—Under these rules, the adoption by the Makati trial court of
the facts stated in the decision of the Parañaque trial court does not fall under the
exception to the right of confrontation as the exception contemplated by law covers
only the utilization of testimonies of absent witnesses made in previous proceedings,
and does not include utilization of previous decisions or judgments.
Same; Same; Same; Same; Same; Same; A previous decision or judgment, while
admissible in evidence, may only prove that an accused was previously convicted of a
crime—it may not be used to prove that the accused is guilty of a crime charged in a
subsequent case.—A previous decision or judgment, while admissible in evidence,
may only prove that an accused was previously convicted of a crime. It may not be
used to prove that the accused is guilty of a crime charged in a subsequent case, in lieu
of the requisite evidence proving the commission of the crime, as said previous
decision is hearsay. To sanction its being used as a basis for conviction in a subsequent
205
case would constitute a violation of the right of the accused to confront the witnesses
against him.
Same; Same; Same; Same; Same; Every conviction must be based on the findings of
fact made by a trial court according to its appreciation of the evidence before it—a
conviction may not be based merely on the findings of fact of another court.—As
earlier stated, the Makati court’s utilization of and reliance on the previous decision of
the Parañaque court must be rejected. Every conviction must be based on the findings
of fact made by a trial court according to its appreciation of the evidence before it. A
conviction may not be based merely on the findings of fact of another court, especially
where what is presented is only its decision sans the transcript of the testimony of the
witnesses who testified therein and upon which the decision is based.
Same; Same; Same; Words and Phrases; “Simple Illegal Recruitment” and “Illegal
Recruitment in Large Scale,” Distinguished.—The distinction between simple illegal
recruitment and illegal recruitment in large scale are emphasized by jurisprudence.
Simple illegal recruitment is committed where a person: (a) undertakes any recruitment
activity defined under Article 13(b) or any prohibited practice enumerated under
Articles 34 and 38 of the Labor Code; and (b) does not have a license or authority to
lawfully engage in the recruitment and placement of workers. On the other hand,
illegal recruitment in large scale further requires a third element, that is, the offense is
committed against three or more persons, individually or as a group.
Same; Same; Same; Evidence; In illegal recruitment in large scale, while the law does
not require that at least three victims testify at the trial, it is necessary that there is
sufficient evidence proving that the offense was committed against three or more
persons.—In illegal recruitment in large scale, while the law does not require that at
least three victims testify at the trial, it is necessary that there is sufficient evidence
proving that the offense was committed against three or more persons. This Court
agrees with the trial court that the evidence presented sufficiently proves that illegal
recruitment was committed by appellant against Marasigan, but the same conclusion
cannot be made as regards Generillo and Del Rosario as well.
Same; Same; Same; Estafa; Double Jeopardy; Conviction under the Labor Code for
illegal recruitment does not preclude punishment under the Revised Penal Code for the
felony of estafa.—The Court likewise affirms the conviction of appellant for estafa
which was committed against Marasigan. Conviction under the Labor Code for illegal
recruitment does not preclude punishment under the Revised Penal Code for the felony
of estafa. This Court is convinced that the prosecution proved beyond reasonable doubt
that appellant violated Article 315(2)(a) of the Revised Penal Code. People vs. Ortiz-
Miyake, 279 SCRA 180, G.R. Nos. 115338-39 September 16, 1997
Accused-appellant Lanie Ortiz-Miyake was charged with illegal recruitment in large
scale in the Regional Trial Court of Makati on a complaint initiated by Elenita
Marasigan, Imelda Generillo and Rosamar del Rosario. In addition, she was indicted
for estafa by means of false pretenses in the same court, the offended party being
Elenita Marasigan alone.
The information in the charge of illegal recruitment in large scale in Criminal Case No.
92-6153 reads as follows:
That in or about the period comprised from June 1992 to August 1992, in the
Municipality of Paraaque, Metro Manila, Philippines and within the jurisdiction of this
Honorable Court, the above-named accused, falsely representing herself to have the
capacity and power to contract, enlist and recruit workers for employment abroad did
then and there willfully, unlawfully, and feloniously collect for a fee, recruit and
promise employment/job placement abroad to the following persons, to wit: 1)
Rosamar del Rosario; 2) Elenita Marasigan; 3) Imelda Generillo, without first securing
the required license or authority from the Department of Labor and Employment, thus
amounting to illegal recruitment in large scale, in violation of the aforecited law. 1
The information in the charge for estafa in Criminal Case No. 92-6154 alleges:
That in or about or sometime in the month of August, 1992, in the Municipality of
Paraaque, Metro Manila, Philippines and within the jurisdiction of this Honorable
Court, the above-named accused, by means of false pretenses executed prior to or
simultaneously with the commission of the fraud, falsely pretending to have the
capacity and power to send complainant Elenita Marasigan to work abroad, succeeded
in inducing the latter to give and deliver to her the total sum of P23,000.00, the
accused knowing fully well that the said manifestations and representation are false
and fraudulent and calculated only to deceive the said complainant to part with her
money, and, once in possession thereof, the said accused did then and there willfully,
unlawfully and feloniously appropriate, apply and convert the same to her own
personal use and benefit, to the damage and prejudice of the said Elenita Marasigan, in
the aforementioned amount of P23,000.00. 2
Upon arraignment, appellant pleaded not guilty to the charges and the cases were tried
jointly in Branch 145 of the Regional Trial Court of Makati.
Of the three complainants in the case for illegal recruitment in large scale, Marasigan
was the only one who testified at the trial. The two other complainants, Generillo and
Del Rosario, were unable to testify as they were then abroad.
Marasigan testified that she was a 32 year-old unmarried sales representative in 1992
when she was introduced to appellant by her co-complainants. 3Appellant promised
Marasigan a job as a factory worker in Taiwan for a P5,000.00 fee. At that time,
Marasigan had a pending application for overseas employment pending in a
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recruitment agency. Realizing that the fee charged by appellant was much lower than
that of the agency, Marasigan withdrew her money from the agency and gave it to
appellant. 4
Marasigan paid appellant P5,000.00, but she was later required to make additional
payments. By the middle of the year, she had paid a total of P23,000.00 on installment
basis. 5 Save for two receipts, 6 Marasigan was not issued receipts for the foregoing
payments despite her persistence in requesting for the same.
Marasigan was assured by appellant that obtaining a Taiwanese visa would not be a
problem. 7 She was also shown a plane ticket to Taiwan, allegedly issued in her
name. 8 Appellant issued Marasigan a photocopy of her plane ticket, 9 the original of
which was promised to be given to her before her departure. 10
Marasigan was never issued a visa. 11 Neither was she given the promised plane ticket.
Unable to depart for Taiwan, she went to the travel agency which issued the ticket and
was informed that not only was she not booked by appellant for the alleged flight, but
that the staff in the agency did not even know appellant.
Later, Marasigan proceeded to the supposed residence of appellant and was informed
that appellant did not live there. 12 Upon verification with the Philippine Overseas
Employment Administration (POEA), it was revealed that appellant was not authorized
to recruit workers for overseas employment. 13 Marasigan wanted to recover her money
but, by then, appellant could no longer be located.
The prosecution sought to prove that Generillo and Del Rosario, the two other
complainants in the illegal recruitment case, were also victimized by appellant. In lieu
of their testimonies, the prosecution presented as witnesses Lilia Generillo, the mother
of Imelda Generillo, and Victoria Amin, the sister of Del Rosario.
Lilia Generillo claimed that she gave her daughter P8,000.00 to cover her application
for placement abroad which was made through appellant. 14 Twice, she accompanied
her daughter to the residence of appellant so that she could meet her; however, she was
not involved in the transactions between her daughter and appellant. 15 Neither was she
around when payments were made to appellant. Imelda Generillo was unable to leave
for abroad and Lilia Generillo concluded that she had become a victim of illegal
recruitment.
The prosecution presented Victoria Amin, the sister of Rosamar Del Rosario, to show
that the latter was also a victim of illegal recruitment. Victoria Amin testified that
appellant was supposed to provide her sister a job abroad. She claimed that she gave
her sister a total of P10,000.00 which was intended to cover the latters processing
fee. 16
Victoria Amin never met appellant and was not around when her sister made
payments. She assumed that the money was paid to appellant based on receipts,
allegedly issued by appellant, which her sister showed her. 17 Del Rosario was unable
to leave for abroad despite the representations of appellant. Victoria Amin claimed that
her sister, like Marasigan and Generillo, was a victim of illegal recruitment.
The final witness for the prosecution was Riza Balberte, 18 a representative of the
POEA, who testified that appellant was neither licensed nor authorized to recruit
workers for overseas employment, POEA certificate certification. 19
Upon the foregoing evidence, the prosecution sought to prove that although two of the
three complainants in the illegal recruitment case were unable to testify, appellant was
guilty of committing the offense against all three complainants and, therefore, should
be convicted as charged.
On the other hand, appellant, who was the sole witness for the defense, denied that she
recruited the complainants for overseas employment and claimed that the payments
made to her were solely for purchasing plane tickets at a discounted rate as she had
connections with a travel agency. 20
She denied that she was paid by Marasigan the amount of P23,000.00, claiming that
she was paid only P8,000.00, as shown by a receipt. She further insisted that, through
the travel agency, 21 she was able to purchase discounted plane tickets for the
complainants upon partial payment of the ticket prices, the balance of which she
guaranteed. According to her, the complainants were supposed to pay her the balance
but because they failed to do so, she was obliged to pay the entire cost of each ticket.
The evidence presented by the parties were thus contradictory but the trial court found
the prosecutions evidence more credible. On December 17, 1993, judgment was
rendered by said court convicting appellant of both crimes as charged. 22
In convicting appellant of illegal recruitment in large scale, the lower court adopted a
previous decision of Branch 78 of the Metropolitan Trial Court of Paraaque as a basis
for the judgment. Said previous decision was a conviction for estafa promulgated on
July 26, 1993, 23rendered in Criminal Cases Nos. 74852-53, involving the same
circumstances in the instant case, wherein complainants Generillo and Del Rosario
charged appellant with two counts of estafa. This decision was not appealed and had
become final and executory.
In thus convicting appellant in the illegal recruitment case, the decision therein of the
Regional Trial Court stated that the facts in the foregoing estafa cases were the same as
those in the illegal recruitment case before it. It, therefore, adopted the facts and
conclusions established in the earlier decision as its own findings of facts and as its
rationale for the conviction in the case before it. 24
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In Criminal Case No. 92-6153, the Makati court sentenced appellant to serve the
penalty of life imprisonment for illegal recruitment in large scale, as well as to pay a
fine of P100,000.00. Appellant was also ordered to reimburse the complainants the
following payments made to her, viz.: (a) Marasigan, P23,000.00; (b)
Generillo, P2,500.00; and (c) Del Rosario, P2,500.00.
In the same judgment and for the estafa charged in Criminal Case No. 92-6154, the
Makati court sentenced appellant to suffer imprisonment of four (4) years and two (2)
months of prision correccional, as minimum, to eight (8) years of prision mayor, as
maximum, and to pay the costs.
In the instant petition, appellant seeks the reversal of the foregoing judgment of the
Regional Trial Court of Makati convicting her of illegal recruitment in large scale and
estafa. Specifically, she insists that the trial court erred in convicting her of illegal
recruitment in large scale as the evidence presented was insufficient.
Moreover, appellant claims that she is not guilty of acts constituting illegal
recruitment, in large scale or otherwise, because contrary to the findings of the trial
court, she did not recruit the complainants but merely purchased plane tickets for them.
Finally, she contends that in convicting her of estafa, the lower court erred as she did
not misappropriate the money paid to her by Marasigan, hence there was no damage to
the complainants which would substantiate the conviction.
We uphold the finding that appellant is guilty but we are, compelled to modify the
judgment for the offenses she should be convicted of and the corresponding penalties
therefor.
Appellant maintains that her conviction for illegal recruitment in large scale is
erroneous. It is her view that in the prosecution of a case for such offense, at least three
complainants are required to appear as witnesses in the trial and, since Marasigan was
the only complainant presented as a witness, the conviction was groundless.
The Solicitor General also advocates the conviction of appellant for simple illegal
recruitment which provides a lower penalty. The Court finds the arguments of the
Solicitor General meritorious and adopts his position.
The Labor Code defines recruitment and placement as x x x any act of canvassing,
enlisting, contracting transporting, utilizing, hiring or procuring workers and includes
referrals, contract services, promising or advertising for employment, locally or
abroad, whether for profit or not x x x. 25
Illegal recruitment is likewise defined and made punishable under the Labor Code,
thus:
Art. 38. Illegal Recruitment. -
(a) Any recruitment activities, including the prohibited practices enumerated
under Article 34 of this Code, to be undertaken by non-licensees or non-
holders of authority shall be deemed illegal and punishable under Article 39
of this Code. x x x.
(b) Illegal recruitment when committed by a syndicate or in large scale shall
be considered an offense involving economic sabotage and shall be penalized
in accordance with Article 39 hereof.
x x x Illegal recruitment is deemed committed in large scale if committed
against three (3) or more persons individually or as a group.
Art. 39. Penalties. -
(a) The penalty of life imprisonment and a fine of One Hundred Thousand
Pesos (P100,000.00) shall be imposed if Illegal Recruitment constitutes
economic sabotage as defined herein;
xxx
(c) Any person who is neither a licensee nor a holder of authority under this
Title found violating any provision thereof or its implementing rules and
regulations shall, upon conviction thereof, suffer the penalty of imprisonment
of not less than four (4) years nor more than eight (8) years or a fine of not
less than P20,000.00 nor more than P100,000.00, or both such imprisonment
and fine, at the discretion of the court. x x x 
During the pendency of this case, Republic Act No. 8042, otherwise known as the
Migrant Workers and Overseas Filipinos Act of 1995, was passed increasing the
penalty for illegal recruitment. This new law, however, does not apply to the instant
case because the offense charged herein was committed in 1992, before the effectivity
of said Republic Act No. 8042. Hence, what are applicable are the aforecited Labor
Code provisions.
It is evident that in illegal recruitment cases, the number of persons victimized is
determinative. Where illegal recruitment is committed against a lone victim, the
accused may be convicted of simple illegal recruitment which is punishable with a
lower penalty under Article 39(c) of the Labor Code. Corollarily, where the offense is
committed against three or more persons, it is qualified to illegal recruitment in large
scale which provides a higher penalty under Article 39(a) of the same Code.
The position of the Solicitor General is that the conviction of appellant should be
merely for the lesser offense of simple illegal recruitment. He submits that the
Regional Trial Court of Makati erred in convicting appellant of illegal recruitment in
large scale because the conviction was based on an earlier decision of the Metropolitan
208
Trial Court of Paraaque where appellant was found guilty of estafa committed against
Generillo and Del Rosario.
It is argued that the Makati court could not validly adopt the facts embodied in the
decision of the Paraaque court to show that illegal recruitment was committed against
Generillo and Del Rosario as well. Illegal recruitment was allegedly proven to have
been committed against only one person, particularly, Elenita Marasigan. Appellant,
therefore, may only be held guilty of simple illegal recruitment and not of such offense
in large scale.
He further submits that the adoption by the Makati court of the facts in the decision of
the Paraaque court for estafa to constitute the basis of the subsequent conviction for
illegal recruitment is erroneous as it is a violation of the right of appellant to confront
the witnesses, that is, complainants Generillo and Del Rosario, during trial before it.
He cites the pertinent provision of Rule 115 of the Rules of Court, to wit:
Section 1. Rights of accused at the trial. In all criminal prosecutions, the accused shall
be entitled:
xxx
(f) To confront and cross-examine the witnesses against him at the trial. Either party
may utilize as part of its evidence the testimony of a witness who is deceased, out of or
cannot, with due diligence be found in the Philippines, unavailable or otherwise unable
to testify, given in another case or proceeding, judicial or administrative, involving the
same parties and subject matter, the adverse party having had the opportunity to cross-
examine him.
xxx
It will be noted that the principle embodied in the foregoing rule is likewise found in
the following provision of Rule 130:
Section 47. Testimony or deposition at a former proceeding. - The testimony or
deposition of a witness deceased or unable to testify, given in a former case or
proceeding, judicial or administrative, involving the same parties and subject matter,
may be given in evidence against the adverse party who had the opportunity to cross-
examine him.
Under the aforecited rules, the accused in a criminal case is guaranteed the right of
confrontation. Such right has two purposes: first, to secure the opportunity of cross-
examination; and, second, to allow the judge to observe the deportment and appearance
of the witness while testifying. 27chanroblesvirtuallawlibrary
This right, however, is not absolute as it is recognized that it is sometimes impossible
to recall or produce a witness who has already testified in a previous proceeding, in
which event his previous testimony is made admissible as a distinct piece of evidence,
by way of exception to the hearsay rule. 28 The previous testimony is made admissible
because it makes the administration of justice orderly and expeditious. 29
Under these rules, the adoption by the Makati trial court of the facts stated in
the decision of the Paraaque trial court does not fall under the exception to the right of
confrontation as the exception contemplated by law covers only the utilization
of testimonies of absent witnesses made in previous proceedings, and does not include
utilization of previous decisions or judgments.
In the instant case, the prosecution did not offer the testimonies made by complainants
Generillo and Del Rosario in the previous estafa case. Instead, what was offered,
admitted in evidence, and utilized as a basis for the conviction in the case for illegal
recruitment in large scale was the previous decision in the estafa case.
A previous decision or judgment, while admissible in evidence, may only prove that an
accused was previously convicted of a crime. 30 It may not be used to prove that the
accused is guilty of a crime charged in a subsequent case, in lieu of the requisite
evidence proving the commission of the crime, as said previous decision is hearsay. To
sanction its being used as a basis for conviction in a subsequent case would constitute a
violation of the right of the accused to confront the witnesses against him.
As earlier stated, the Makati courts utilization of and reliance on the previous decision
of the Paraaque court must be rejected. Every conviction must be based on the findings
of fact made by a trial court according to its appreciation of the evidence before it. A
conviction may not be based merely on the findings of fact of another court, especially
where what is presented is only its decision sans the transcript of the testimony of the
witnesses who testified therein and upon which the decision is based.
Furthermore, this is not the only reason why appellant may not be held liable for illegal
recruitment in large scale. An evaluation of the evidence presented before the trial
court shows us that, apart from the adopted decision in the previous estafa case, there
was no other basis for said trial courts conclusion that illegal recruitment in large scale
was committed against all three complainants.
The distinction between simple illegal recruitment and illegal recruitment in large scale
are emphasized by jurisprudence. Simple illegal recruitment is committed where a
person: (a) undertakes any recruitment activity defined under Article 13(b) or any
prohibited practice enumerated under Articles 34 and 38 of the Labor Code; and (b)
does not have a license or authority to lawfully engage in the recruitment and
placement of workers. 31On the other hand, illegal recruitment in large scale further
requires a third element, that is, the offense is committed against three or more
persons, individually or as a group. 32
209
In illegal recruitment in large scale, while the law does not require that at least three
victims testify at the trial, it is necessary that there is sufficient evidence proving that
the offense was committed against three or more persons. This Court agrees with the
trial court that the evidence presented sufficiently proves that illegal recruitment was
committed by appellant against Marasigan, but the same conclusion cannot be made as
regards Generillo and Del Rosario as well.
The testimonies of Generillos mother, Lilia Generillo, and Del Rosarios sister, Victoria
Amin, reveal that these witnesses had no personal knowledge of the actual
circumstances surrounding the charges filed by Generillo and Del Rosario for illegal
recruitment in large scale. Neither of these witnesses was privy to the transactions
between appellant and each of the two complainants. The witnesses claimed that
appellant illegally recruited Generillo and Del Rosario. Nonetheless, we find their
averments to be unfounded as they were not even present when Generillo and Del
Rosario negotiated with and made payments to appellant.
For insufficiency of evidence and in the absence of the third element of illegal
recruitment in large scale, particularly, that the offense is committed against three or
more persons, we cannot affirm the conviction for illegal recruitment in large scale.
Nonetheless, we agree with the finding of the trial court that appellant illegally
recruited Marasigan, for which she must be held liable for the lesser offense of simple
illegal recruitment.
Appellants defense that she did not recruit Marasigan but merely purchased a plane
ticket for her is belied by the evidence as it is undeniable that she represented to
Marasigan that she had the ability to send people to work as factory workers in
Taiwan. Her pretext that the fees paid to her were merely payments for a plane ticket is
a desperate attempt to exonerate herself from the charges and cannot be sustained.
Furthermore, no improper motive may be attributed to Marasigan in charging
appellant. The fact that Marasigan was poor does not make her so heartless as to
contrive a criminal charge against appellant. She was a simple woman with big dreams
and it was appellants duplicity which reduced those dreams to naught. Marasigan had
no motive to testify falsely against appellant except to tell the
truth. 33chanroblesvirtuallawlibrary
Besides, if there was anyone whose testimony needed corroboration, it was appellant
as there was nothing in her testimony except the bare denial of the accusations. 34 If
appellant really intended to purchase a plane ticket and not to recruit Marasigan, she
should have presented evidence to support this claim. Also, in her testimony, appellant
named an employee in the travel agency who was allegedly her contact person for the
purchase of the ticket. She could have presented that person, or some other employee
of the agency, to show that the transaction was merely for buying a ticket. Her failure
to do the foregoing acts belies her pretensions.
The Court likewise affirms the conviction of appellant for estafa which was committed
against Marasigan. Conviction under the Labor Code for illegal recruitment does not
preclude punishment under the Revised Penal Code for the felony of estafa. 35 This
Court is convinced that the prosecution proved beyond reasonable doubt that appellant
violated Article 315(2)(a) of the Revised Penal Code which provides that estafa is
committed:
2. By means of any of the following false pretenses or fraudulent acts executed prior to
or simultaneously with the commission of the fraud:
(a) By using fictitious name or falsely pretending to possess power, influence,
qualifications, property, credit, agency, business or imaginary transactions, or by
means of other similar deceits.
The evidence is clear that in falsely pretending to possess power to deploy persons for
overseas placement, appellant deceived the complainant into believing that she would
provide her a job in Taiwan. Her assurances made Marasigan exhaust whatever
resources she had to pay the placement fee required in exchange for the promised job.
The elements of deceit and damage for this form of estafa are indisputably present,
hence the conviction for estafa in Criminal Case No. 92-6154 should be affirmed.
Under the Revised Penal Code, an accused found guilty of estafa shall be sentenced to:
x x x The penalty of prision correccional in its maximum period to prision mayor in
its minimum period, if the amount of the fraud is over 12,000 but does not exceed
22,000 pesos, and if such amount exceeds the latter sum, the penalty provided in this
paragraph shall be imposed in its maximum period, adding one year for each additional
10,000 pesos x x x. 36
The amount involved in the estafa case is P23,000.00. Applying the Indeterminate
Sentence Law, the maximum penalty shall be taken from the maximum period of the
foregoing basic penalty, specifically, within the range of imprisonment from six (6)
years, eight (8) months and twenty-one (21) days to eight (8) years.
On the other hand, the minimum penalty of the indeterminate sentence shall be within
the range of the penalty next lower in degree to that provided by law, without
considering the incremental penalty for the amount in excess of P22,000.00. 37 That
penalty immediately lower in degree is prison correccional in its minimum and
medium periods, with a duration of six (6) months and one (1) day to four (4) years
and two (2) months. On these considerations, the trial court correctly fixed the
minimum and maximum terms of the indeterminate sentence in the estafa case.
While we must be vigilant and should punish, to the fullest extent of the law, those
who prey upon the desperate with empty promises of better lives, only to feed on their
aspirations, we must not be heedless of the basic rule that a conviction may be
210
sustained only where it is for the correct offense and the burden of proof of the guilt of
the accused has been met by the prosecution.

WHEREFORE, the judgment of the court a quo finding accused-appellant Lanie

Ortiz-Miyake guilty beyond reasonable doubt of the crimes of illegal recruitment in
large scale (Criminal Case No. 92-6153) and estafa (Criminal Case No. 92-6154) is
hereby MODIFIED, as follows:

1) Accused-appellant is declared guilty beyond reasonable doubt of simple illegal

recruitment, as defined in Article 38(a) of the Labor Code, as amended. She is hereby
ordered to serve an indeterminate sentence of four (4) years, as minimum, to eight (8)
years, as maximum, and to pay a fine of P100,000.00.

2) In Criminal Case No. 92-6154 for estafa, herein accused-appellant is ordered to

serve an indeterminate sentence of four (4) years and two (2) months of prision
correccional, as minimum, to eight (8) years of prision mayor, as maximum, and to
reimburse Elenita Marasigan the sum of P23,000.00.

In all other respects, the aforestated judgment is AFFIRMED, with costs against
accused-appellant in both instances.

SO ORDERED.

211