TITLE: BOSTON EQUITY RESOURCES, INC., PETITIONER, VS.

COURT OF
APPEALS AND LOLITA G. TOLEDO, RESPONDENTS. (G.R. No. 173946)

ORIGINAL PLAINTIFF: BOSTON EQUITY RESOURCES, INC.

ORIGINAL DEFENDANT: Lolita Toledo

FACTS: On 24 December 1997, petitioner filed a complaint for sum of money with a
prayer for the issuance of a writ of preliminary attachment against the spouses Manuel
and Lolita Toledo.[6] Herein respondent filed an Answer dated 19 March 1998 but on 7
May 1998, she filed a Motion for Leave to Admit Amended Answer in which she alleged,
among others, that her husband and co-defendant, Manuel Toledo (Manuel), is already
dead.

Petitioner then filed a Motion for Substitution,[12] dated 18 January 2000, praying that
Manuel be substituted by his children as party-defendants. It appears that this motion
was granted by the trial court

However, on 7 October 2004, respondent instead filed a motion to dismiss the

complaint, citing the following as grounds: (1) that the complaint failed to implead an
indispensable party or a real party in interest; hence, the case must be dismissed for
failure to state a cause of action; (2) that the trial court did not acquire jurisdiction over
the person of Manuel pursuant to Section 5, Rule 86 of the Revised Rules of Court; (3)
that the trial court erred in ordering the substitution of the deceased Manuel by his heirs;
and (4) that the court must also dismiss the case against Lolita Toledo in accordance
with Section 6, Rule 86 of the Rules of Court.

ISSUE: WON whether or not the denial by the trial court of the motion to dismiss on the
ground of lack of jurisdiction is correct?

RTC RULING: The trial court, in an Order dated 8 November 2004, denied the motion
to dismiss for having been filed out of time, citing Section 1, Rule 16 of the 1997 Rules
of Court which states that: "[W]ithin the time for but before filing the answer to the
complaint or pleading asserting a claim, a motion to dismiss may be made x x x."[17]
Respondent’s motion for reconsideration of the order of denial was likewise denied on
the ground that "defendants’ attack on the jurisdiction of this Court is now barred by
estoppel by laches" since respondent failed to raise the issue despite several chances
to do so.[

CA RULING: The Court of Appeals granted the petition based on the following
grounds:It is elementary that courts acquire jurisdiction over the person of the defendant
x x x only when the latter voluntarily appeared or submitted to the court or by coercive
process issued by the court to him, x x x. In this case, it is undisputed that when
[petitioner] Boston filed the complaint on December 24, 1997, defendant Manuel S.
Toledo was already dead, x x x. Such being the case, the court a quo could not have
acquired jurisdiction over the person of defendant Manuel S. Toledo.
However, x x x it is well-settled that issue on jurisdiction may be raised at any stage of
the proceeding, even for the first time on appeal. By timely raising the issue on
jurisdiction in her motion to dismiss x x x [respondent] is not estopped [from] raising the
question on jurisdiction. Moreover, when issue on jurisdiction was raised by
[respondent], the court a quo had not yet decided the case, hence, there is no basis for
the court a quo to invoke estoppel to justify its denial of the motion for reconsideration;

SC RULING: Yes, Petitioner calls attention to the fact that respondent’s motion to
dismiss questioning the trial court’s jurisdiction was filed more than six years after her
amended answer was filed. According to petitioner, respondent had several
opportunities, at various stages of the proceedings, to assail the trial court’s jurisdiction
but never did so for six straight years. Citing the doctrine laid down in the case of Tijam,
et al. v. Sibonghanoy, et al.[30] petitioner claimed that respondent’s failure to raise the
question of jurisdiction at an earlier stage bars her from later questioning it, especially
since she actively participated in the proceedings conducted by the trial court.

Petitioner’s argument is misplaced, in that, it failed to consider that the concept of

jurisdiction has several aspects, namely: (1) jurisdiction over the subject matter; (2)
jurisdiction over the parties; (3) jurisdiction over the issues of the case; and (4) in cases
involving property, jurisdiction over the res or the thing which is the subject of the
litigation.

The Court, in the Sarsaba Case, resolved the issue in this wise:

x x x We cannot countenance petitioner’s argument that the complaint against the other
defendants should have been dismissed, considering that the RTC never acquired
jurisdiction over the person of Sereno. The court’s failure to acquire jurisdiction over
one’s person is a defense which is personal to the person claiming it. Obviously, it is
now impossible for Sereno to invoke the same in view of his death. Neither can
petitioner invoke such ground, on behalf of Sereno, so as to reap the benefit of having
the case dismissed against all of the defendants. Failure to serve summons on Sereno’s
person will not be a cause for the dismissal of the complaint against the other
defendants, considering that they have been served with copies of the summons and
complaints and have long submitted their respective responsive pleadings. In fact, the
other defendants in the complaint were given the chance to raise all possible defenses
and objections personal to them in their respective motions to dismiss and their
subsequent answers.[43] (Emphasis supplied.)

Hence, the Supreme Court affirmed the dismissal by the trial court of the complaint
against Sereno only.

Based on the foregoing pronouncements, there is no basis for dismissing the complaint
against respondent herein. Thus, as already emphasized above, the trial court correctly
denied her motion to dismiss.
TITLE: BANCO DE ORO-EPCI, INC. (FORMERLY EQUITABLE PCI BANK),
PETITIONER, VS. JOHN TANSIPEK, RESPONDENT (G.R. No. 181235)

ORIGINAL PLAINTIFF: BANCO DE ORO-EPCI, INC. (FORMERLY EQUITABLE PCI

BANK)

ORIGINAL DEFENDANT: JOHN TANSIPEK

FACTS: J. O. Construction, Inc. (JOCI), a domestic corporation engaged in the

construction business in Cebu City, filed a complaint against Philippine Commercial and
Industrial Bank (PCIB) in the Regional Trial Court (RTC) of Makati City docketed as Civil
Case No. 97-508. The Complaint alleges that JOCI entered into a contract with Duty
Free Philippines, Inc. for the construction of a Duty Free Shop in Mandaue City. As
actual construction went on, progress billings were made. Payments were received by
JOCI directly or through herein respondent John Tansipek, its authorized collector.
Payments received by respondent Tansipek were initially remitted to JOCI. However,
payment through PNB Check No. 0000302572 in the amount of P4,050,136.51 was not
turned over to JOCI. Instead, respondent Tansipek endorsed said check and deposited
the same to his account in PCIB, Wilson Branch, Wilson Street, Greenhills, San Juan,
Metro Manila. PCIB allowed the said deposit, despite the fact that the check was
crossed for the deposit to payee's account only, and despite the alleged lack of authority
of respondent Tansipek to endorse said check. PCIB refused to pay JOCI the full
amount of the check despite demands made by the latter. JOCI prayed for the payment
of the amount of the check (P4,050,136.51), P500,000.00 in attorney's fees,
P100,000.00 in expenses, P50,000.00 for costs of suit, and P500,000.00 in exemplary
damages.

PCIB filed a Motion to Admit Amended Third-Party Complaint. The amendment

consisted in the correction of the caption, so that PCIB appeared as Third-Party Plaintiff
and Tansipek as Third-Party Defendant.

Upon Motion, respondent Tansipek was granted time to file his Answer to the Third-
Party Complaint. He was, however, declared in default for failure to do so. The Motion
to Reconsider the Default Order was denied.

Respondent Tansipek filed a Petition for Certiorari with the Court of Appeals assailing
the Default Order and the denial of the Motion for Reconsideration. The Petition was
docketed as CA-G.R. SP No. 47727. On 29 May 1998, the Court of Appeals dismissed
the Petition for failure to attach the assailed Orders. On 28 September 1998, the Court
of Appeals denied respondent Tansipek's Motion for Reconsideration for having been
filed out of time.

Pre-trial on the main case ensued between JOCI and PCIB.

ISSUE: WON CA erred in finding that it was an error for the trial court to have acted on
PCIB's motion to declare respondent Tansipek in default.

RTC RULING: On the third party complaint, third-party defendant John Tansipek is
ordered to pay the third-party plaintiff Philippine Commercial and Industrial Bank all
amounts said defendant/third-party plaintiff shall have to pay to the plaintiff on account
of this case.[3]

CA RULING: Respondent Tansipek appealed the Decision to the Court of Appeals. On

18 August 2006, the Court of Appeals issued the assailed Decision finding that it was an
error for the trial court to have acted on PCIB's motion to declare respondent Tansipek
in default.

SC RULING: YES. To recapitulate, upon being declared in default, respondent

Tansipek filed a Motion for Reconsideration of the Default Order. Upon denial thereof,
Tansipek filed a Petition for Certiorari with the Court of Appeals, which was dismissed
for failure to attach the assailed Orders. Respondent Tansipek's Motion for
Reconsideration with the Court of Appeals was denied for having been filed out of time.
Respondent Tansipek did not appeal said denial to this Court.

Respondent Tansipek's remedy against the Order of Default was erroneous from the
very beginning. Respondent Tansipek should have filed a Motion to Lift Order of
Default, and not a Motion for Reconsideration, pursuant to Section 3(b), Rule 9 of the
Rules of Court:

(b) Relief from order of default.--A party declared in default may at any time after notice
thereof and before judgment file a motion under oath to set aside the order of default
upon proper showing that his failure to answer was due to fraud, accident, mistake or
excusable negligence and that he has a meritorious defense. In such case, the order of
default may be set aside on such terms and conditions as the judge may impose in the
interest of justice.

Assuming for the sake of argument, however, that respondent Tansipek's Motion for
Reconsideration may be treated as a Motion to Lift Order of Default, his Petition for
Certiorari on the denial thereof has already been dismissed with finality by the Court of
Appeals. Respondent Tansipek did not appeal said ruling of the Court of Appeals to this
Court. The dismissal of the Petition for Certiorari assailing the denial of respondent
Tansipek's Motion constitutes a bar to the retrial of the same issue of default under the
doctrine of the law of the case.

The issue of the propriety of the Order of Default had already been adjudicated in
Tansipek's Petition for Certiorari with the Court of Appeals. As such, this issue cannot
be readjudicated in Tansipek's appeal of the Decision of the RTC on the main case.
Once a decision attains finality, it becomes the law of the case, whether or not said
decision is erroneous.[10] Having been rendered by a court of competent jurisdiction
acting within its authority, the judgment may no longer be altered even at the risk of
legal infirmities and errors it may contain.[11]