No. L-62339. October 27, 1983.
* and easily thwarted if the Lupon’s authority is exercised only in cases falling within the
SPOUSES MARIA LUISA P. MORATA AND JULIUS MORATA, petitioners, vs. SPOUSES
VICTOR GO and FLORA C. GO and HON. VALERIANO P. TOMOL, JR., Judge, Court of First
Instance of Cebu, Branch XI, respondents.
Courts; Barangay Courts; Extent of authority of the Lupon Tagapamayapa in the
settlement of cases.—Thus, except in the instances enumerated in sections 2 and 6 of the
law, the Lupon has the authority to settle amicably all types of disputes involving parties
who actually reside in the same city or municipality. The law, as written, makes no
distinction whatsoever with respect to the classes of civil disputes that should be
compromised at the barangay level, in contradistinction to the limitation imposed upon
the Lupon by paragraph (3), section 2 thereof as regards its authority over criminal cases.
In fact, in defining the Lupon’s authority, Section 2 of said law employed the universal and
comprehensive term “all”, to which usage We should neither add nor subtract in
consonance with the rudimentary precept in statutory construction that “where the law
does not distinguish, We should not distinguish.”
Same; Same; Purpose of Pres. Decree 1508 in the settlement of disputes at barangay level.
—By compelling the disputants to settle their differences through the intervention of the
barangay leader and other respected members of the barangay, the animosity generated
by protracted court litigations between members of the same political unit, a disruptive
factor toward unity and cooperation, is avoided. It must be borne in mind that the
conciliation process at the barangay level is likewise designed to discourage indiscriminate
filing of cases in court in order to decongest its clogged dockets and, in the process,
enhance the quality of justice dispensed by it. Thus, to say that the authority of the Lupon
is limited to cases exclusively cognizable by the inferior courts is to lose sight of this
objective. Worse, it would make the law a self-defeating one. For what would stop a party,
say in an action for a sum of money or damages, as in the instant case, from bloating up
his claim in order to place his case beyond the jurisdiction of the inferior court and
thereby avoid the mandatory requirement of P.D. 1508? And why, indeed, should the law
seek to ease the congestion of dockets only in inferior courts and not in the regional trial
courts where the log-jam of cases is much more serious? Indeed, the lawmakers could not
have intended such half-measure and self-defeating legislation.
Same; Same; Cases falling within the jurisdiction of Courts of First Instance must also be
coursed first to the barangay court in the cases mentioned by law cognizable by the
Lupon.—There can be no question that when the law conferred upon the Lupon “the
authority to bring together the parties actually residing in the same city or municipality for
amicable settlement of all disputes, x x x,” its obvious intendment was to grant to the
Lupon as broad and comprehensive an authority as possible as would bring about the
optimum realization of the aforesaid objectives. These objectives would only be half-met
1
De Joya Civil Procedure
exclusive jurisdiction of inferior courts.
Same; Same; The Chief Justice has directed all courts, including CFIs, not to receive
complaints in cases falling under the authority of the Lupon.—It is significant that the
above-quoted circular embodying the directive “to desist from receiving complaints,
petitions, actions and proceedings in cases falling within the authority of said Lupons,” has
been addressed not only to judges of city and municipal courts, but also to all the judges
of the courts of first instance, circuit criminal courts, juvenile and domestic courts and
courts of agrarian relations, now known as regional trial courts under B.P. No. 129. The
said circular was noted by President Ferdinand E. Marcos in a Letter of Implementation,
dated November 12, 1979, the first paragraph of which reads as follows: “with the view to
easing up the log-jam of cases and solving the backlogs in the case of dockets of all
government offices involved in the investigation, trial and adjudication of cases, it is
hereby ordered that immediate implementation be made by all government officials and
offices concerned of the system of amicably settling disputes at the barangay level as
provided for in the Katarungang Pambarangay Law [Presidential Decree No. 1508].”
Aquino, J., concurring:
Courts; Barangays; The Chief Justice has issued an order to CFIs to refrain from receiving
complaints without prior barangay certification.—Chief Justice Fernando in his Circular
No. 22 dated November 9, 1979 has enjoined all Judges of the Courts of First Instance,
Circuit Criminal Courts, Juvenile and Domestic Relations Courts, Agrarian Courts, city
courts, municipal courts and their clerks of court to desist from receiving complaints,
petitions, actions or proceedings in cases falling within the authority of the barangay
Lupons effective upon their receipt of the certification of the Minister of Local
Government and Community Development that all the barangays within their respective
jurisdictions have organized their Lupons as contemplated in the Katarungang
Pambarangay Law.
Same; Same; The Minister of Justice has assumed that Pres. Decree 1508 applies to CFI
cases.—The Minister of Justice has assumed that the Katarungang Pambarangay Law
applies to the cases in Regional Trial Courts or Courts of First Instance. Thus, he ruled that
a complaint for damages in the sum of P100,000 is a matter falling within the authority of
the Lupon under section 2 of Presidential Decree No. 1508 (Opinion No. 81, Series of
1981; Katarungang Pambarangay Opinion No. 10, Series of 1981).
PETITION for certiorari and prohibition with preliminary injunction to review the order of
the Court of First Instance of Cebu, Br. XI Tomol, Jr., J.
KPL
The facts are stated in the opinion of the Court.
     Amado G. Olis for petitioners.
     Paul G. Gorres for private respondents.
ESCOLIN., J.:
In this petition for certiorari and prohibition with prayer for writ of preliminary injunction,
the Court is called upon to determine the classes of actions which fall within the coverage
of Presidential Decree No. 1508,1 otherwise known as Katarungang Pambarangay Law.
This law requires the compulsory process of arbitration at the Barangay level as a pre-
condition for filing a complaint in court. Petitioners contend that said legislation is so
broad and all-embracing as to apply to actions cognizable not only by the city and
municipal courts, now known as the metropolitan trial courts and municipal trial courts,
but also by the courts of first instance, now the regional trial courts. Upon the other hand,
respondents would limit its coverage only to those cases falling within the exclusive
jurisdiction of the metropolitan trial courts and municipal trial courts.
The antecedent facts are not disputed. On August 5, 1982, respondents Victor Go and
Flora D. Go filed in the defunct Court of First Instance of Cebu, presided by respondent
Judge Valeriano P. Tomol, Jr., a complaint against petitioners Julius Morata and Ma. Luisa
Morata for recovery of a sum of money plus damages amounting to P49,400.00. The case
was docketed as Civil Case No. R-22154.
On the basis of the allegation in the complaint that the parties-litigants are all residents of
Cebu City, petitioners filed a motion to dismiss, citing as grounds therefor, the failure of
the complaint to allege prior availment by the plaintiffs of the barangay conciliation
process required by P.D. 1508, as well as the absence of a certification by the Lupon or
Pangkat Secretary that no conciliation or settlement had been reached by the parties. The
motion was opposed by private respondents.
On September 2, 1982, respondent judge issued an order denying the motion to dismiss.
Petitioners filed a motion for reconsideration, but the same was denied in an order dated
October 3, 1982, as follows:
“Considering the specific reference to City or Municipal Courts in the provisions of
Sections 11 and 12 of P.D. No. 1508, as the Courts to which the dispute settled or
arbitrated by the Lupon Chairman or the Pangkat, shall be elevated for nullification of the
award or for execution of the same, and considering that from the provision of Section 14
of the same law, the pre-condition to the filing of a complaint as provided for in Section 6
thereof, is specifically referred to, it is the considered opinion of this Court that the
2
De Joya Civil Procedure
provision of Section 6 of the law applies only to cases cognizable by the inferior courts
mentioned in Sections 11 and 12 of the law.
“In view of the foregoing, the motion for reconsideration filed by the defendants, of the
order of September 2, 1982, denying their motion to dismiss, is hereby denied.” [Annex
‘G’, p. 36, Rollo].
From this order, petitioners came to Us thru this petition. In a resolution dated December
2, 1982, We required respondents to file an answer, and likewise granted a temporary
restraining order enjoining respondent judge from requiring petitioners to file their
answer and enter into trial in Civil Case No. R-22154.
We find the petition impressed with merit.
Section 6 of P.D. 1508 reads as follows:
“SECTION 6. Conciliation, pre-condition to filing of complaint.—No complaint, petition,
action for proceeding involving any matter within the authority of the Lupon as provided
in Section 2 hereof shall be filed or instituted in court or any other government office for
adjudication unless there has been a confrontation of the parties before the Lupon
Chairman or the Pangkat and no conciliation or settlement has been reached as certified
by the Lupon Secretary or the Pangkat Secretary attested by the Lupon or Pangkat
Chairman, or unless the settlement has been repudiated. However, the parties may go
directly to court in the following cases:
[1]Where the accused is under detention;
[2]Where a person has otherwise been deprived of personal liberty calling for habeas
corpus proceedings;
[3]Actions coupled with provisional remedies such as preliminary injunction, attachment,
delivery of personal property and support pendente lite; and
[4]Where the action may otherwise be barred by the Statute of Limitations.”
Section 2 of the law defines the scope of authority of the Lupon thus:
“SECTION 2. Subject matters for amicable settlement.—The Lupon of each barangay shall
have authority to bring together the parties actually residing in the same city or
municipality for amicable settlement of all disputes except:
“[1]Where one party is the government, or any subdivision or instrumentality thereof;
“[2]Where one party is a public officer or employee, and the dispute relates to the
performance of his official functions;
“[3]Offenses punishable by imprisonment exceeding 30 days, or a fine exceeding P200.00;
KPL
“[4]Offenses where there is no private offended party;
“[5]Such other classes of disputes which the Prime Minister may in the interest of justice
determine upon recommendation of the Minister of Justice and the Minister of Local
Government.”
Thus, except in the instances enumerated in sections 2 and 6 of the law, the Lupon has the
authority to settle amicably all types of disputes involving parties who actually reside in
the same city or municipality. The law, as written, makes no distinction whatsoever with
respect to the classes of civil disputes that should be compromised at the barangay level,
in contradistinction to the limitation imposed upon the Lupon by paragraph (3), section 2
thereof as regards its authority over criminal cases. In fact, in defining the Lupon’s
authority, Section 2 of said law employed the universal and comprehensive term “all”, to
which usage We should neither add nor subtract in consonance with the rudimentary
precept in statutory construction that “where the law does not distinguish, We should not
distinguish.”2
By compelling the disputants to settle their differences through the intervention of the
barangay leader and other respected members of the barangay, the animosity generated
by protracted court litigations between members of the same political unit, a disruptive
factor toward unity and cooperation, is avoided. It must be borne in mind that the
conciliation process at the barangay level is likewise designed to discourage indiscriminate
filing of cases in court in order to decongest its clogged dockets and, in the process,
enhance the quality of justice dispensed by it. Thus, to say that the authority of the Lupon
is limited to cases exclusively cognizable by the inferior courts is to lose sight of this
objective. Worse, it would make the law a self-defeating one. For what would stop a party,
say in an action for a sum of money or damages, as in the instant case, from bloating up
his claim in order to place his case beyond the jurisdiction of the inferior court and
thereby avoid the mandatory requirement of P.D. 1508? And why, indeed, should the law
seek to ease the congestion of dockets only in inferior courts and not in the regional trial
courts where the log-jam of cases is much more serious? Indeed, the lawmakers could not
have intended such half-measure and self-defeating legislation.
The objectives of the law are set forth in its preamble thus:
“WHEREAS, the perpetuation and official recognition of the time-honored tradition of
amicably settling disputes among family and barangay level without judicial resources
would promote the speedy administration of justice and implement the constitutional
mandate to preserve and develop Filipino culture and to strengthen the family as a basic
social institution;
3
De Joya Civil Procedure
“WHEREAS, the indiscriminate filing of cases in the courts of justice contributes heavily
and unjustifiably to the congestion of court dockets, thus causing a deterioration in the
quality of justice;
“WHEREAS, in order to help relieve the courts of such docket congestion and thereby
enhance the quality of justice dispensed by the courts, it is deemed desirable to formally
organize and institutionalize a system of amicably settling disputes at the barangay level.”
There can be no question that when the law conferred upon the Lupon “the authority to
bring together the parties actually residing in the same city or municipality for amicable
settlement of all disputes, x x x,” its obvious intendment was to grant to the Lupon as
broad and comprehensive an authority as possible as would bring about the optimum
realization of the aforesaid objectives. These objectives would only be half-met and easily
thwarted if the Lupon’s authority is exercised only in cases falling within the exclusive
jurisdiction of inferior courts.
Moreover, if it is the intention of the law to restrict its coverage only to cases cognizable
by the inferior courts, then it would not have provided in Section 3 thereof the following
rule on venue, to wit:
“Section 3. Venue. x x x However, all disputes which involve real property or any interest
therein shall be brought in the Barangay where the real property or any part thereof is
situated.”
for it should be noted that, traditionally and historically,jurisdiction over cases involving
real property or any interesttherein, except forcible entry and detainer cases, has
alwaysbeen vested in the courts of first instance [now regional trialcourt].
But it is pointed out by the respondent judge that Sections 11,3 12,4 and 145 of the law
speak of the city and/or municipal courts as the forum for the nullification or execution of
the settlement or arbitration award issued by the Lupon. We hold that this circumstance
cannot be construed as a limitation of the scope of authority of the Lupon. As heretofore
stated, the authority of the Lupon is clearly established in Section 2 of the law; whereas
Sections 11, 12 and 14, relied upon by respondent judge, deal with the nullification or
execution of the settlement or arbitration awards obtained at the barangay level. These
sections conferred upon the city and municipal courts the jurisdiction to pass upon and
resolve petitions or actions for nullification or enforcement of settlement/arbitration
awards issued by the Lupon, regardless of the amount involved or the nature of the
original dispute. But there is nothing in the context of said sections to justify the thesis
that the mandated
KPL

_______________
3 SECTION 11. Effect of amicable settlement and arbitration award.—The amicable
settlement and arbitration award shall have the force and effect of a final judgment of a
court upon the expiration of ten (10) days after the date thereof unless repudiation of the
settlement has been made or a petition for nullification of the award has been filed before
the proper city or municipal court.
4 SECTION 12. Execution.—The amicable settlement or arbitration award may be enforced
by execution within one (1) year from the date of settlement. After the lapse of such time,
the settlement may be enforced by action in the appropriate city/municipal court.
5 SECTION 14. Transmittal of settlement and arbitration award to court.—The Secretary of
the Lupon shall transmit the settlement or the arbitration award to the local city or
municipal court within five (5) days from the date of the award or from the lapse of the
ten-day period for repudiating the settlement and shall furnish copies thereof to each of
the parties to the settlement and the Barangay Captain.
conciliation process in other types of cases applies exclusively to said inferior courts.
Any doubt on the issue before Us should be dispelled by Circular No. 22 issued by Chief
Justice Enrique M. Fernando,6 the full text of which is quoted as follows:
“TO: ALL JUDGES OF THE COURTS OF FIRST INSTANCE, CIRCUIT CRIMINAL COURTS,
JUVENILE AND DOMESTIC RELATIONS COURTS, COURTS OF AGRARIAN RELATIONS, CITY
COURTS, MUNICIPAL COURTS AND THEIR CLERKS OF COURT
“SUBJECT: Implementation of the Katarungang Pambarangay Law.
authority of said Lupons,” has been addressed not only to judges of city and municipal
courts, but also to all the judges of the courts of first instance, circuit criminal courts,
juvenile and domestic courts and courts of agrarian relations, now known as regional trial
courts under B.P. No. 129. The said circular was noted by president Ferdinand E. Marcos in
a Letter of Implementation, dated November 12, 1979, the first paragraph of which reads
as follows: “with the view to easing up the log-jam of cases and solving the backlogs in the
case of dockets of all government offices involved in the investigation, trial and
adjudication of cases, it is hereby ordered that immediate implementation be made by all
government officials and offices concerned of the system of amicably settling disputes at
the barangay level as provided for in the Katarungang Pambarangay Law [Presidential
Decree No. 1508].”
Therefore, for the guidance of the bench and the bar, We now declare that the
conciliation process at the barangay level, prescribed by P.D. 1508 as a pre-condition for
filing a complaint in court, is compulsory not only for cases falling under the exclusive
competent of the metropolitan and municipal trial courts, but for actions cognizable by
the regional trial courts as well.
ACCORDINGLY, the petition is granted, and the order of respondent judge denying
petitioners’ motion to dismiss is hereby set aside. Respondent judge is restrained from
conducting further proceedings in Civil Case No. R-22154, except to dismiss the case. No
costs.
SO ORDERED.

“Effective upon your receipt of the certification by the Minister of Local Government and
Community Development that all the barangays within your respective jurisdictions have
organized their Lupons provided for in Presidential Decree No. 1508, otherwise known as
the Katarungang Pambarangay Law, in implementation of the barangay system of
settlement of disputes, you are hereby directed to desist from receiving complaints,
petitions, actions or proceedings in cases falling within the authority of said Lupons.

“Circular No. 12 dated October 20, 1978, issued by the late Chief Justice Fred Ruiz Castro is
to that extent modified.

“This Circular takes effect immediately.”

It is significant that the above-quoted circular embodying the directive “to desist from
receiving complaints, petitions, actions and proceedings in cases falling within the

4
De Joya Civil Procedure KPL
G.R. No. 167261. March 2, 2007.*
ROSARIA LUPITAN PANG-ET, petitioner, vs. CATHERINE MANACNES-DAO-AS, Heir of
LEONCIO MANACNES and FLORENTINA MANACNES, respondent.
Katarungang Pambarangay Law; The object of the Katarungang Pambarangay Law is the
amicable settlement of disputes through conciliation proceedings voluntarily and freely
entered into by the parties; The disputing parties are not compelled to settle their
controversy during the barangay proceedings before the Lupon or the Pangkat, as they are
free to instead find recourse in the courts.—At this juncture, it must be stressed that the
object of the Katarungang Pambarangay Law is the amicable settlement of disputes
through conciliation proceedings voluntarily and freely entered into by the parties.
Through this mechanism, the parties are encouraged to settle their disputes without
enduring the rigors of court litigation. Nonetheless, the disputing parties are not
compelled to settle their controversy during the barangay proceedings before the Lupon
or the Pangkat, as they are free to instead find recourse in the courts in the event that no
true compromise is reached.
Same; The key in achieving the objectives of an effective amicable settlement under the
Katarungang Pambarangay Law is the free and voluntary agreement of the parties to
submit the dispute for adjudication either by the Lupon or the Pangkat, whose award or
decision shall be binding upon them with the force and effect of a final judgment of a
court.—The key in achieving the objectives of an effective amicable settlement under the
Katarungang Pambarangay Law is the free and voluntary agreement of the parties to
submit the dispute for adjudication either by the Lupon or the Pangkat, whose award or
decision shall be binding upon them with the force and effect of a final judgment of a
court. Absent this voluntary submission by the parties to submit their dispute to
arbitration under the Katarungang Pambarangay Law, there cannot be a binding
settlement arrived at effectively resolving the case. Hence, we fail to see why the MCTC
further remanded the case to the Lupon ng Tagapamayapa and insisted that the
arbitration proceedings continue, despite the clear showing that the spouses Manacnes
refused to submit the controversy for arbitration. It would seem from the Order of the
MCTC, which again remanded the case for arbitration to the Lupon ng Tagapamayapa,
that it is compulsory on the part of the parties to submit the case for arbitration until an
arbitration award is rendered by the Lupon. This, to our minds, is contrary to the very
nature of the proceedings under the Katarungang Pambarangay Law which espouses the
principle of voluntary acquiescence of the disputing parties to amicable settlement.
Same; What is compulsory under the Katarungang Pambarangay Law is that there be a
confrontation between the parties before the Lupon Chairman or the Pangkat and that a
certification be issued that no conciliation or settlement has been reached, as attested to
by the Lupon or Pangkat Chairman, before a case falling within the authority of the Lupon
5
De Joya Civil Procedure
may be instituted in court or any other government office for adjudication.—What is
compulsory under the Katarungang Pambarangay Law is that there be a confrontation
between the parties before the Lupon Chairman or the Pangkat and that a certification be
issued that no conciliation or settlement has been reached, as attested to by the Lupon or
Pangkat Chairman, before a case falling within the authority of the Lupon may be
instituted in court or any other government office for adjudication. In other words, the
only necessary pre-condition before any case falling within the authority of the Lupon or
the Pangkat may be filed before a court is that there has been personal confrontation
between the parties but despite earnest efforts to conciliate, there was a failure to
amicably settle the dispute. It should be emphasized that while the spouses Manacnes
appeared before the Lupon during the initial hearing for the conciliation proceedings, they
refused to sign the Agreement for Arbitration form, which would have signified their
consent to submit the case for arbitration. Therefore, upon certification by the Lupon ng
Tagapamayapa that the confrontation before the Pangkat failed because the spouses
Manacnes refused to submit the case for arbitration and insisted that the case should go
to court, the MCTC should have continued with the proceedings in the case for recovery of
possession which it suspended in order to give way for the possible amicable resolution of
the case through arbitration before the Lupon ng Tagapamayapa.
Same; As reflected in Section 413 of the Revised Katarungang Pambarangay Law, in order
that a party may be bound by an arbitration award, said party must have agreed in writing
that they shall abide by the arbitration award of the Lupon or the Pangkat.—The MCTC
should not have persisted in ordering the Lupon ng Tagapamayapa to render an
arbitration award upon the refusal of the spouses Manacnes to submit the case for
arbitration since such arbitration award will not bind the spouses. As reflected in Section
413 of the Revised Katarungang Pambarangay Law, in order that a party may be bound by
an arbitration award, said party must have agreed in writing that they shall abide by the
arbitration award of the Lupon or the Pangkat. Like in any other contract, parties who
have not signed an agreement to arbitrate will not be bound by said agreement since it is
axiomatic that a contract cannot be binding upon and cannot be enforced against one
who is not a party to it. In view of the fact that upon verification by the Pangkat Chairman,
in order to settle the issue of whether or not they intend to submit the matter for
arbitration, the spouses Manacnes refused to affix their signature or thumb mark on the
Agreement for Arbitration Form, the Manacnes spouses cannot be bound by the
Agreement for Arbitration and the ensuing arbitration award since they never became
privy to any agreement submitting the case for arbitration by the Pangkat.
PETITION for review on certiorari of a decision of the Court of Appeals.
The facts are stated in the opinion of the Court.
KPL
     Ma. Inglay Capuyan-Fokno for petitioner.
     Johnny Ekid for respondent.
CHICO-NAZARIO, J.:
Before Us is a Petition for Review on Certiorari under Rule 45 of the Rules of Civil
Procedure, assailing the Decision1 of the Court of Appeals in CA-G.R. SP No. 78019, dated
9 February 2005, which reversed and set aside the Judgment2 of the Regional Trial Court
(RTC), Branch 36, Bontoc, Mountain Province, and reinstated the Resolution3 of the
Municipal Circuit Trial Court (MCTC) of Besao-Sagada, Mountain Province dismissing
herein petitioner’s action for Enforcement of Arbitration Award and Damages.
The instant petition draws its origin from an Action4 for recovery of possession of real
property situated in Sitio Abatan, Barrio Dagdag, Sagada filed by herein petitioner before
the MCTC of Besao-Sagada, Mountain Province on 9 November 1994, against the spouses
Leoncio and Florentina Manacnes, the predecessors-in-interest of herein respondent.
On 23 February 1995, during the course of the pre-trial, the parties, through their
respective counsels, agreed to refer the matter to the Barangay Lupon (Lupon) of Dagdag,
Sagada for arbitration in accordance with the provisions of the Katarungang Pambarangay
Law.5 Consequently, the proceedings before the MCTC were suspended, and the case was
remanded to the Lupon for resolution.6
Thereafter, the Lupon issued a Certification to File Action on 26 February 1995 due to the
refusal of the Manacnes spouses to enter into an Agreement for Arbitration and their
insistence that the case should go to court. On 8 March 1995, the Certification, as well as
the records of the case, were forwarded to the MCTC.
An Order was issued by the MCTC on 7 April 1995, once more remanding the matter for
conciliation by the Lupon and ordering the Lupon to render an Arbitration Award thereon.
According to the MCTC, based on the records of the case, an Agreement for Arbitration
was executed by the parties concerned; however, the Lupon failed to issue an Arbitration
Award as provided under the Katarungang Pambarangay Law, so that, the case must be
returned to the Lupon until an Arbitration Award is rendered.
In compliance with the MCTC Order, the Lupon rendered an Arbitration Award on 10 May
1995 ordering herein petitioner to retrieve the land upon payment to the spouses
Manacnes of the amount of P8,000.00 for the improvements on the land. Aggrieved,
Leoncio’s widow,7 Florentina Manacnes, repudiated the Arbitration Award but her
repudiation was rejected by the Lupon. Thereafter, the MCTC was furnished with copies of
the Arbitration Award.
6
De Joya Civil Procedure
On 1 June 1995, herein petitioner filed with the Lupon a Motion for Execution of the
Arbitration Award. On the other hand, Florentina Manacnes filed a Motion with the MCTC
for the resumption of the proceedings in the original case for recovery of possession and
praying that the MCTC consider her repudiation of the Arbitration Award issued by the
Lupon.
Subsequently, the MCTC heard the Motion of Florentina Manacnes notwithstanding the
latter’s failure to appear before the court despite notice. The MCTC denied Florentina
Manacnes’ Motion to repudiate the Arbitration Award elucidating that since the movant
failed to take any action within the 10-day reglementary period provided for under the
Katarungang Pambarangay Law, the arbitration award has become final and executory.
Furthermore, upon motion of herein petitioner Pang-et, the MCTC issued an Order
remanding the records of the case to the Lupon for the execution of the Arbitration
Award. On 31 August 1995, the then incumbent Punong Barangay of Dagdag issued a
Notice of Execution of the Award.
Said Notice of Execution was never implemented. Thus, on 16 October 2001, herein
petitioner Pang-et filed with the MCTC an action for enforcement of the Arbitration Award
which was sought to be dismissed by the heir of the Manacnes spouses.8 The heir of the
Manacnes spouses argues that the Agreement for Arbitration and the Arbitration Award
are void, the Agreement for Arbitration not having been personally signed by the spouses
Manacnes, and the Arbitration Award having been written in English—a language not
understood by the parties.
In its Resolution dated 20 August 2002, the MCTC dismissed the Petition for Enforcement
of Arbitration Award in this wise:
“x x x Are defendants estopped from questioning the proceedings before the Lupon
Tagapamayapa concerned?
The defendants having put in issue the validity of the proceedings before the lupon
concerned and the products thereof, they are not estopped. It is a hornbook rule that a
null and void act could always be questioned at any time as the action or defense based
upon it is imprescriptible.
The second issue: Is the agreement to Arbitrate null and void? Let us peruse the pertinent
law dealing on this matter which is Section 413 of the Local Government Code of 1991 (RA
7160), to wit:
KPL
“Section 413—(a) The parties may, at any stage of the proceedings, agree in writing that
they shall abide by the arbitration award of the lupon chairman or the pangkat. x x x” The
foregoing should be taken together with Section 415 of the same code which provides:
“Section 415. Appearance of parties in person.—In all katarungang pambarangay
proceedings, the parties must appear in person without the assistance of counsel or
representative, except for minors and incompetents who may be assisted by their next-of-
kin who are not lawyers.”
It is very clear from the foregoing that personal appearance of the parties in conciliation
proceedings before a Lupon Tagapamayapa is mandatory. Likewise, the execution of the
agreement to arbitrate must be done personally by the parties themselves so that they
themselves are mandated to sign the agreement.
Unfortunately, in this case, it was not respondents-spouses [Manacnis] who signed the
agreement to arbitrate as plaintiff herself admitted but another person. Thus, it is very
clear that the mandatory provisos of Section 413 and 415 of RA 7160 are violated.
Granting arguendo that it was Catherine who signed the agreement per instruction of her
parents, will it cure the violation? The answer must still be in the negative. As provided for
by the cited provisos of RA 7160, if ever a party is entitled to an assistance, it shall be done
only when the party concerned is a minor or incompetent. Here, there is no showing that
the spouses [Manacnis] were incompetent. Perhaps very old but not incompetent.
Likewise, what the law provides is assistance, not signing of agreements or settlements.
Just suppose the spouses [Manacnis] executed a special power of attorney in favor of their
daughter Catherine to attend the proceedings and to sign the agreement to arbitrate? The
more that it is proscribed by the Katarungang Pambarangay Law specifically Section 415 of
RA 7160 which mandates the personal appearance of the parties before the lupon and
likewise prohibits the appearance of representatives.
In view of the foregoing, it could now be safely concluded that the questioned agreement
to arbitrate is inefficacious for being violative of the mandatory provisions of RA 7160
particularly sections 413 and 415 thereof as it was not the respondents-spouses
[Manacnis] who signed it.
The third issue: Is the Arbitration Award now sought to be enforced effective? Much to be
desired, the natural flow of events must follow as a consequence. Considering that the
agreement to arbitrate is inefficacious as earlier declared, it follows that the arbitration
award which emanated from it is also inefficacious. Further, the Arbitration Award by
itself, granting arguendo that the agreement to arbitrate is valid, will readily show that it
7
De Joya Civil Procedure
does not also conform with the mandate of the Katarungang Pambarangay Law
particularly Section 411 thereto which provides:
“Sec. 411. Form of Settlement.—All amicable settlements shall be in writing in a language
or dialect known to the parties x x x. When the parties to the dispute do not use the same
language or dialect, the settlement shall be written in the language known to them.”
Likewise, the implementing rules thereof, particularly Section 13 provides:
“Sec. 13. Form of Settlement and Award.—All settlements, whether by mediation,
conciliation or arbitration, shall be in writing, in a language or dialect known to the parties.
x x x”
It is of no dispute that the parties concerned belong to and are natives of the scenic and
serene community of Sagada, Mt. Province who speak the Kankanaey language. Thus, the
Arbitration Award should have been written in the Kankanaey language. However, as
shown by the Arbitration Award, it is written in English language which the parties do not
speak and therefore a further violation of the Katarungang Pambarangay Law.
IN THE LIGHT of all the foregoing considerations, the aboveentitled case is hereby
dismissed.”9
Petitioner Pang-et’s Motion for Reconsideration having been denied, she filed an Appeal
before the RTC which reversed and set aside the Resolution of the MCTC and remanded
the case to the MCTC for further proceedings. According to the RTC:
“As it appears on its face, the Agreement for Arbitration in point found on page 51 of the
expediente, dated Feb. 6, 1995, and attested by the Pangkat Chairman of the Office of the
Barangay Lupon of Dagdag, Sagada was signed by the respondents/defendants spouses
Manacnis. The representative of the Appellee in the instant case assails such Agreement
claiming that the signatures of her aforesaid predecessors-in-interest therein were not
personally affixed by the latter or are falsified-which in effect is an attack on the validity of
the document on the ground that the consent of the defendants spouses Manacnis is
vitiated by fraud. Indulging the Appellee Heirs of Manacnis its contention that such indeed
is the truth of the matter, the fact still remains as borne out by the circumstances, that
neither did said original defendants nor did any of such heirs effectively repudiate the
Agreement in question in accordance with the procedure outlined by the law, within five
(5) days from Feb. 6, 1995, on the ground as above-stated (Secs. 413 (a), 418, RA 7160;
Secs. 7, 13, KP Law; Sec. 12, Rule IV, KP Rules). As mandated, such failure is deemed a
waiver on the part of the defendants spouses Manacnis to challenge the Agreement for
Arbitration on the ground that their consent thereto is obtained and vitiated by fraud
KPL
(Sec. 12, Par. 3, KP Rules). Corollarily, the Appellee Heirs being privy to the now deceased
original defendants should have not been permitted by the court a quo under the
equitable principle of estoppel, to raise the matter in issue for the first time in the present
case (Lopez vs. Ochoa, 103 Phil. 94).
The Arbitration Award relative to Civil Case 83 (B.C. No. 07) dated May 10, 1995, written in
English, attested by the Punong Barangay of Dagdag and found on page 4 of the record is
likewise assailed by the Appellee as void on the ground that the English language is not
known by the defendants spouses Manacnis who are Igorots. Said Appellee contends that
the document should have been written in Kankana-ey, the dialect known to the party
(Sec. 413 (b), RA 7160; Sec. 7, Par. 2, KP law, Sec. 11, KP Rules). On this score, the court a
quo presumptuously concluded on the basis of the selfserving mere say-so of the
representative of the Appellee that her predecessors did not speak or understand English.
As a matter of judicial notice, American Episcopalian Missionaries had been in Sagada,
Mountain Province as early as 1902 and continuously stayed in the place by turns, co-
mingling with the indigenous people thereat, instructing and educating them, and
converting most to the Christian faith, among other things, until the former left about
twenty years ago. By constant association with the white folks, the natives too old to go to
school somehow learned the King’s English by ear and can effectively speak and
communicate in that language. Any which way, even granting arguendo that the
defendants spouses Manacnis were the exceptions and indeed totally ignorant of English,
no petition to nullify the Arbitration award in issue on such ground as advanced was filed
by the party or any of the Appellee Heirs with the MCTC of Besao-Sagada, within ten (10)
days from May 10, 1995, the date of the document. Thus, upon the expiration thereof, the
Arbitration Award acquired the force and effect of a final judgment of a court (Sec. 416,
RA 7160; Sec. 11, KP Law; Sec. 13, KP Rules); conclusive upon the original defendants in
Civil Case 83 (B.C. No. 07) and the Appellee Heirs herein privy to said defendants.
In the light thereof, the collateral attack of the Appellee on the Agreement for Arbitration
and Arbitration Award re Civil Case 83 (B.C. No. 07) should not have in the first place been
given due course by the court a quo. In which case, it would not have in the logical flow of
things declared both documents “inefficacious;” without which pronouncements, said
court would not have dismissed the case at bar.
Wherefore, Judgment is hereby rendered Reversing and Setting Aside the Resolution
appealed from, and ordering the record of the case subject thereof remanded to the court
of origin for further proceedings.”10
Aggrieved by the reversal of the RTC, herein respondent filed a petition before the Court
of Appeals seeking to set aside the RTC Judgment. On 9 February 2005, the appellate
court rendered the herein assailed Decision, to wit:
8
De Joya Civil Procedure
“After thoroughly reviewing through the record, We find nothing that would show that
the spouses Manacnes were ever amenable to any compromise with respondent Pang-et.
Thus, We are at a loss as to the basis of the Arbitration Award sought to be enforced by
respondent Pang-et’s subsequent action before the MCTC.
There is no dispute that the proceeding in Civil Case No. 83 was suspended and the same
remanded to the Lupon on account of the Agreement to Arbitrate which was allegedly not
signed by the parties but agreed upon by their respective counsels during the pretrial
conference. In the meeting before the Lupon, it would seem that the agreement to
arbitrate was not signed by the spouses Manacnes. More importantly, when the pangkat
chairman asked the spouses Manacnes to sign or affix their thumbmarks in the
agreement, they refused and insisted that the case should instead go to court. Thus, the
Lupon had no other recourse but to issue a certificate to file action. Unfortunately, the
case was again remanded to the Lupon to “render an arbitration award.” This time, the
Lupon heard the voice tape of the late Beket Padonay affirming respondent Pang-et’s right
to the disputed property. While Pang-et offered to pay P8,000.00 for the improvements
made by the spouses Manacnes, the latter refused to accept the same and insisted on
their right to the subject property. Despite this, the Lupon on May 10, 1995 issued an
Arbitration award which favored respondent Pang-et.
From the time the case was first referred to the Lupon to the time the same was again
remanded to it, the Spouses Manacnes remained firm in not entering into any
compromise with respondent Pang-et. This was made clear in both the minutes of the
Arbitration Hearing on 26 February 1995 and on 9 April 1995. With the foregoing, We find
it evident that the spouses Manacnes never intended to submit the case for arbitration.
Moreover, the award itself is riddled with flaws. First of all there is no showing that the
Pangkat ng Tagapagkasundo was duly constituted in accordance with Rule V of the
Katarungan Pambarangay Rules. And after constituting of the Pangkat, Rule VI, thereof the
Punong Barangay and the Pangkat must proceed to hear the case. However, according to
the minutes of the hearing before the lupon on 9 April 1995, the pangkat Chairman and
another pangkat member were absent for the hearing.
Finally, Section 13 of the same Rule requires that the Punong Barangay or the Pangkat
Chairman should attest that parties freely and voluntarily agreed to the settlement arrived
at. But how can this be possible when the minutes of the two hearings show that the
spouses Manacnes neither freely nor voluntarily agreed to anything.
While RA 7160 and the Katarungan Pambarangay rules provide for a period to repudiate
the Arbitration Award, the same is neither applicable nor necessary since the Agreement
KPL
to Arbitrate or the Arbitration Award were never freely nor voluntarily entered into by
one of the parties to the dispute. In short, there is no agreement validly concluded that
needs to be repudiated.
With all the foregoing, estoppel may not be applied against petitioners for an action or
defense against a null and void act does not prescribe. With this, We cannot but agree
with the MCTC that the very agreement to arbitrate is null and void. Similarly, the
arbitration award which was but the off shoot of the agreement is also void.
WHEREFORE, the RTC judgment of 2 June 2003 is REVERSED and SET ASIDE, the MCTC
Resolution DISMISSING the Civil Case No. 118 for enforcement of Arbitration Award is
REINSTATED.”11
Vehemently disagreeing with the Decision of the Court of Appeals, petitioner Pang-et filed
the instant petition. Petitioner maintains that the appellate court overlooked material
facts that resulted in reversible errors in the assailed Decision. According to petitioner, the
Court of Appeals overlooked the fact that the original parties, as represented by their
respective counsels in Civil Case No. 83, mutually agreed to submit the case for arbitration
by the Lupon ng Tagapamayapa of Barangay Dagdag. Petitioner insists that the parties
must be bound by the initial agreement by their counsels during pre-trial to an amicable
settlement as any representation made by the lawyers are deemed made with the
conformity of their clients. Furthermore, petitioner maintains that if indeed the spouses
Manacnes did not want to enter into an amicable settlement, then they should have
raised their opposition at the first instance, which was at the pre-trial on Civil Case No. 83
when the MCTC ordered that the case be remanded to the Lupon ng Tagapamayapa for
arbitration.
We do not agree with the petitioner.
First and foremost, in order to resolve the case before us, it is pivotal to stress that, during
the initial hearing before the Lupon ng Tagapamayapa, the spouses Manacnes declined to
sign the Agreement for Arbitration and were adamant that the proceedings before the
MCTC in Civil Case No. 83 must continue. As reflected in the Minutes12 of the Arbitration
Hearing held on 26 February 1995, the legality of the signature of Catherine Manacnes,
daughter of the Manacnes spouses, who signed the Agreement for Arbitration on behalf
of her parents, was assailed on the ground that it should be the spouses Manacnes
themselves who should have signed such agreement. To resolve the issue, the Pangkat
Chairman then asked the spouses Manacnes that if they wanted the arbitration
proceedings to continue, they must signify their intention in the Agreement for Arbitration
form. However, as stated earlier, the Manacnes spouses did not want to sign such
agreement and instead insisted that the case go to court.
9
De Joya Civil Procedure
Consequently, the Lupon issued a Certification to File Action on 26 February 1995 due to
the refusal of the Manacnes spouses. Indicated in said Certification are the following: 1)
that there was personal confrontation between the parties before the Punong Barangay
but conciliation failed and 2) that the Pangkat ng Tagapagkasundo was constituted but the
personal confrontation before the Pangkat failed likewise because respondents do not
want to submit this case for arbitration and insist that said case will go to court.13
Nevertheless, upon receipt of said certification and the records of the case, the MCTC
ordered that the case be remanded to the Lupon ng Tagapamayapa and for the latter to
render an arbitration award, explaining that:
“Going over the documents submitted to the court by the office of the Lupon
Tagapamayapa of Dagdag, Sagada, Mountain Province, the court observed that an
“Agreement for Arbitration” was executed by the parties anent the above-entitled case.
However, said Lupon did not make any arbitration award as mandated by the Katarungang
Pambarangay Law but instead made a finding that the case may now be brought to the
court. This is violative of the KP Law, which cannot be sanctioned by the court.”14
At this juncture, it must be stressed that the object of the Katarungang Pambarangay Law
is the amicable settlement of disputes through conciliation proceedings voluntarily and
freely entered into by the parties.15 Through this mechanism, the parties are encouraged
to settle their disputes without enduring the rigors of court litigation. Nonetheless, the
disputing parties are not compelled to settle their controversy during the barangay
proceedings before the Lupon or the Pangkat, as they are free to instead find recourse in
the courts16 in the event that no true compromise is reached.
_______________
16 Revised Katarungang Pambarangay Law, Section 412 (a)—Pre-condition to filing of
Complaint in Court—No complaint, petition, action or proceeding involving any matter
within the authority of the lupon shall be filled or instituted directly in court or any other
government office for adjudication unless there has been a confrontation between the
parties before the lupon chairman or the pangkat, and that no conciliation or settlement
has been reached as certified by the lupon secretary or pangkat secretary as attested to by
the lupon or pangkat chairman or unless the settlement has been repudiated by the parties
thereto.
The key in achieving the objectives of an effective amicable settlement under the
Katarungang Pambarangay Law is the free and voluntary agreement of the parties to
submit the dispute for adjudication either by the Lupon or the Pangkat, whose award or
decision shall be binding upon them with the force and effect of a final judgment of a
court.17 Absent this voluntary submission by the parties to submit their dispute to
KPL
arbitration under the Katarungang Pambarangay Law, there cannot be a binding
settlement arrived at effectively resolving the case. Hence, we fail to see why the MCTC
further remanded the case to the Lupon ng Tagapamayapa and insisted that the
arbitration proceedings continue, despite the clear showing that the spouses Manacnes
refused to submit the controversy for arbitration.
It would seem from the Order of the MCTC, which again remanded the case for arbitration
to the Lupon ng Tagapamayapa, that it is compulsory on the part of the parties to submit
the case for arbitration until an arbitration award is rendered by the Lupon. This, to our
minds, is contrary to the very nature of the proceedings under the Katarungang
Pambarangay Law which espouses the principle of voluntary acquiescence of the disputing
parties to amicable settlement.
What is compulsory under the Katarungang Pambarangay Law is that there be a
confrontation between the parties before the Lupon Chairman or the Pangkat and that a
certification be issued that no conciliation or settlement has been reached, as attested to
by the Lupon or Pangkat Chairman, before a case falling within the authority of the Lupon
may be instituted in court or any other government office for adjudication.18 In other
words, the only necessary pre-condition before any case falling within the authority of the
Lupon or the Pangkat may be filed before a court is that there has been personal
confrontation between the parties but despite earnest efforts to conciliate, there was a
failure to amicably settle the dispute. It should be emphasized that while the spouses
Manacnes appeared before the Lupon during the initial hearing for the conciliation
proceedings, they refused to sign the Agreement for Arbitration form, which would have
signified their consent to submit the case for arbitration. Therefore, upon certification by
the Lupon ng Tagapamayapa that the confrontation before the Pangkat failed because the
spouses Manacnes refused to submit the case for arbitration and insisted that the case
should go to court, the MCTC should have continued with the proceedings in the case for
recovery of possession which it suspended in order to give way for the possible amicable
resolution of the case through arbitration before the Lupon ng Tagapamayapa.
Petitioner’s assertion that the parties must be bound by their respective counsels’
agreement to submit the case for arbitration and thereafter enter into an amicable
settlement is imprecise. What was agreed to by the parties’ respective counsels was the
remand of the case to the Lupon ng Tagapamayapa for conciliation proceedings and not
the actual amicable settlement of the case. As stated earlier, the parties may only be
compelled to appear before the Lupon ng Tagapamayapa for the necessary confrontation,
but not to enter into any amicable settlement, or in the case at bar, to sign the Agreement
for Arbitration. Thus, when the Manacnes spouses personally appeared during the initial
hearing before the Lupon ng Tagapamayapa, they had already complied with the
agreement during the pre-trial to submit the case for conciliation proceedings. Their
10
De Joya Civil Procedure
presence during said hearing is already their acquiescence to the order of the MCTC
remanding the case to the Lupon for conciliation proceedings, as there has been an actual
confrontation between the parties despite the fact that no amicable settlement was
reached due to the spouses Manacnes’ refusal to sign the Agreement for Arbitration.
Furthermore, the MCTC should not have persisted in ordering the Lupon ng
Tagapamayapa to render an arbitration award upon the refusal of the spouses Manacnes
to submit the case for arbitration since such arbitration award will not bind the spouses.
As reflected in Section 413 of the Revised Katarungang Pambarangay Law, in order that a
party may be bound by an arbitration award, said party must have agreed in writing that
they shall abide by the arbitration award of the Lupon or the Pangkat. Like in any other
contract, parties who have not signed an agreement to arbitrate will not be bound by said
agreement since it is axiomatic that a contract cannot be binding upon and cannot be
enforced against one who is not a party to it.19 In view of the fact that upon verification
by the Pangkat Chairman, in order to settle the issue of whether or not they intend to
submit the matter for arbitration, the spouses Manacnes refused to affix their signature or
thumb mark on the Agreement for Arbitration Form, the Manacnes spouses cannot be
bound by the Agreement for Arbitration and the ensuing arbitration award since they
never became privy to any agreement submitting the case for arbitration by the Pangkat.
WHEREFORE, premises considered, the instant petition is hereby DENIED. The Decision of
the Court of Appeals in CAG.R. SP No. 78019 is hereby AFFIRMED. The Municipal Circuit
Trial Court of Besao-Sagada, Mountain Province, is hereby ORDERED to proceed with the
trial of Civil Case No. 83 for Recovery of Possession of Real Property, and the immediate
resolution of the same with deliberate dispatch. No costs. SO ORDERED.
Petition denied, judgment affirmed.
Notes.—Section 415 of the LGC clearly requires the personal appearance of the parties in
katarungang pambarangay conciliation proceedings, unassisted by counsel or
representative. There can be no quibbling that laymen of good will can easily agree to
conciliate and settle their dispute between themselves without what sometimes is the
unsettling assistance of lawyers whose presence could sometimes obfuscate and confuse
issues. (Magno vs. Velasco-Jacoba, 475 SCRA 584 [2005])
The Settlement Agreement of parties approved by the Lupon ng Tagapamayapa may be
enforced by the Lupon, through the punong barangay within six months, and if the
settlement is not enforced after the lapse of said period, it may be enforced by an action
in the proper city or municipal court. (Berba vs. Pablo, 474 SCRA 686 [2005])
KPL
G.R. No. 157830. November 17, 2005.*
DANTE M. PASCUAL, represented by REYMEL R. SAGARIO, petitioner, vs. MARILOU M.
PASCUAL, respondent.
Actions; Katarungang Pambarangay; Where the parties are not actual residents in the
same city or municipality or adjoining barangays, there is no requirement for them to
submit their dispute to the lupon.—In the 1982 case of Tavora v. Veloso, this Court held
that where the parties are not actual residents in the same city or municipality or
adjoining barangays, there is no requirement for them to submit their dispute to the
lupon as provided for in Section 6 vis-à-vis Sections 2 and 3 of P.D. 1508 (Katarungang
Pambarangay Law). [B]y express statutory inclusion and exclusion, the Lupon shall have no
jurisdiction over disputes where the parties are not actual residents of the same city or
municipality, except where the barangays in which they actually reside adjoin each other.
Same; Same; Parties; To construe the express statutory requirement of “actual residency”
as applicable to the attorney-in-fact of the party-plaintiff would abrogate the meaning of
“real party in interest”; Where the plaintiff is not an actual resident of the barangay where
the defendant resides, the local lupon has no jurisdiction over their dispute, hence, prior
referral to it for conciliation is not a precondition to its filing in court.—To construe the
express statutory requirement of actual residency as applicable to the attorney-in-fact of
the party-plaintiff, as contended by respondent, would abrogate the meaning of a “real
party in interest” as defined in Section 2 of Rule 3 of the 1997 Rules of Court vis-à-vis
Section 3 of the same Rule which was earlier quoted but misread and misunderstood by
respondent. In fine, since the plaintiff-herein petitioner, the real party in interest, is not an
actual resident of the barangay where the defendant-herein respondent resides, the local
lupon has no jurisdiction over their dispute, hence, prior referral to it for conciliation is not
a pre-condition to its filing in court.
PETITION for review on certiorari of the order and resolution of the Regional Trial Court of
Isabela, Br. 23.
The facts are stated in the opinion of the Court.
     Pedro C. Antonio for petitioner.
     Bob Armand L. Lecitona for respondent.
CARPIO-MORALES, J.:
On challenge via Petition for Review on Certiorari is the February 10, 2003 Order of the
Regional Trial Court (RTC) of Isabela, Branch 23 at Roxas dismissing, on motion of herein
respondent Marilou M. Pascual, the complaint filed against her by her brother herein
petitioner Dante M. Pascual, represented by his attorney-in-fact Reymel R. Sagario
11
De Joya Civil Procedure
(Sagario), for non-compliance with the conciliation provision-pre condition to filing of
complaint in court under R.A. 7160 (the Local Government Code).
Petitioner, a permanent resident of the United States of America, appointed Sagario as his
attorney-in-fact by a Special Power of Attorney (SPA) dated April 10, 2002:
1.To file a case for the cancellation of Transfer Certificate of Title No. T-271656 issued in
the name of Marilou M. Pascual as well as the Deed of Sale of Registered Land (Dec. No.
639; Page No. 52; Book No. XXI; Series of 1994) and/or Reconveyance at the appropriate
court;
2.To collect the monthly rentals from the tenant;
3.To enter into amicable settlement with Marilou M. Pascual or any other mode of
payment/and/or dispute resolution;
4. To execute and sign any and all papers, contracts/documents which may be necessary
relative to the above acts.
x x x1
Pursuant to the SPA, Sagario filed on October 14, 2002 before the Isabela RTC at Roxas a
complaint entitled “Dante M. Pascual, plaintiff v. Marilou M. Pascual and Register of
Deeds, Defendants,” docketed as Civil Case No. Br. 23-713-02, for Annulment of Transfer
Certificate of Title No. T-271657 of Isabela and Deed of Absolute Sale of Registered Land
and/or Reconveyance with Damages.2
To the Complaint the defendant-herein respondent Marilou M. Pascual filed a Motion to
Dismiss3 on two grounds one of which was non-compliance with the requirement under
Section 412 of the Local Government Code,4 she contending that there is no showing that
the dispute was referred to the barangay court before the case was filed in court.
_______________
4 Sec. 412. Conciliation.—(a) Pre-condition to filing of complaint in court.—No complaint,
petition, action, or proceeding involving any matter within the authority of the lupon shall
be filed or instituted directly in court or any other government office for adjudication,
unless there has been a confrontation between the parties before the lupon chairman or
the pangkat, and that no conciliation or settlement has been reached as certified by the
lupon secretary or pangkat secretary as attested to by the lupon chairman or pangkat
chairman or unless the settlement has been repudiated by the parties thereto.
(b)Where parties may go directly to court.—The parties may go directly to court in the
following instances:
(1)Where the accused is under detention;
(2)Where a person has otherwise been deprived of personal liberty calling for habeas
corpus proceedings;
(3)Where actions are coupled with provisional remedies such as preliminary injunction,
attachment, delivery of personal property, and support pendent lite; and
KPL
 (4)Where the action may otherwise be barred by the statute of limitations. Being the real party in interest, the Attorney-in-fact may therefore bring the necessary
(c)Conciliation among members of indigenous cultural com-munities.—The customs and complaint before the Lupon Tagapayapa and appear in person as if he is the owner of the
traditions of indigenous cultural communities shall be applied in settling disputes between land.9 (Emphasis and italics supplied)
members of the cultural communities.
Hence, the present petition questioning “the palpable legal errors” of the RTC.
By the assailed Order of February 10, 2003,5 Branch 23 of the Isabela RTC at Roxas
granted respondent’s Motion to Dismiss in this wise:
Petitioner argues that since he, not his attorney-in-fact Sagario, is the real party in
interest, and since he actually resides abroad, the lupon would have no jurisdiction to pass
. . . RA 7160 repealing P.D. 1508 otherwise known as the Revised Katarungang
upon the dispute involving real property, he citing Agbayani v. Belen.10
Pambarangay provides under Section 409 “All disputes involving real property or any
interest therein shall be brought in the barangay where the real property or the larger
Respondent submits, on the other hand, that Section 408, paragraph (f), of the Local
portion thereof is situated.” Hence, the reliance of the plaintiff on Section 408 of R.A.
Government Code, is qualified by paragraph (c) of Section 409 of the same Code the latter
7160 is incorrect. When real property or any interest therein is involved, the dispute shall
of which provides that “[a]ll disputes involving real property or any interest therein shall
be filed before the barangay where the property is located, regardless of the residence of
be brought in the barangay where the real property is located,” hence, the use of the
the parties. Besides, it is incorrect to say that the parties are not residents of the same
word “shall” makes it mandatory for the bringing of the dispute before the lupon.
place, Vira, Roxas, Isabela. The Attorney-in-fact of the plaintiff in the person of Reymel R.
Sagario is a resident of Vira, Roxas, Isabela, and he substitute (sic) Dante Pascual by virtue
That attorney-in-fact Sagario is a resident of the same barangay as that of hers,
of said Special Power of Attorney. Hence, said Attorney-in-fact should have brought the
respondent argues in any event, brings the matter under the jurisdiction of the lupon, for
dispute before barangay Vira, Roxas, Isabela, where the property is located. In the case of
Sagario, following Section 3 of Rule 3 of the 1997 Rules of Civil Procedure which provides:
Royales vs. Intermediate Appellate Court, 127 SCRA 470, “Ordinarily, noncompliance with
the condition precedent prescribed by P.D. 1508 could affect the sufficiency of the
Sec. 3. Representative as parties.—Where the action is allowed to be prosecuted or
plaintiff’s cause of action and make his complaint vulnerable to dismissal on ground of lack
defended by a representative or someone acting in a fiduciary capacity, the beneficiary
of cause of action or prematurity.”6 (Emphasis and italics supplied)
shall be included in the title of the case and shall be deemed to be the real party in
interest.
Petitioner’s Motion for Reconsideration7 of the above-said order was denied by Order of
March 24, 2003:8
A representative may be a trustee of an express trust, a guardian, an executor or
administrator, or a party authorized by law or these Rules. An agent acting in his own
xxx
name for the benefit of an undisclosed principal may sue or be sued without joining the
principal except when the contract involves things belonging to the principal,
Consequently, the Court is [of] the opinion that the said Attorney-in-fact shall be deemed
to be the real party in interest, reading from the tenor of the provisions of the Special
being a substitute, becomes the real party-in-interest.
Power of Attorney. Being a real party in interest, the Attorney-in-fact is therefore obliged
to bring this case first before the Barangay Court. Sec. 3, Rule 3 of the Rules of Court
Respondent’s submissions do not lie. The pertinent provisions of the Local Government
provides that “Where the action is allowed to be prosecuted or defended by a
Code read:
representative or someone acting in a fiduciary capacity, the beneficiary shall be included
in the title of the case and shall be deemed to be the real party in interest.
SEC. 408. Subject Matter for Amicable Settlement; Exception Thereto.—The lupon of each
barangay shall have authority to bring together the parties actually residing in the same
xxx
city or municipality for amicable settlement of all disputes except:

(a)Where one party is the government or any subdivision or instrumentality thereof;

12
De Joya Civil Procedure KPL
(b)Where one party is a public officer or employee, and the dispute relates to the
performance of his official functions;
(c)Offenses punishable by imprisonment exceeding one (1) year or a fine exceeding Five
Thousand pesos (P5,000.00);
(d)Offenses where there is no private offended party;
(e)Where the dispute involves real properties located in different cities or municipalities
unless the parties thereto agree to submit their differences to amicable settlement by an
appropriate lupon;
(f)Disputes involving parties who actually reside in barangays of different cities or
municipalities, except where such barangay units adjoin each other and the parties
thereto agree to submit their differences to amicable settlement by an appropriate lupon;
and
(g)Such other classes of disputes which the President may determine in the interest of
justice or upon the recommendation of the Secretary of Justice.
The court in which non-criminal cases not falling within the authority of the lupon under
this Code are filed may, at any time before trial, motu proprio refer the case to the lupon
concerned for amicable settlement. (Emphasis supplied)
SEC. 409. Venue.—(a) Disputes between persons actually residing in the same barangay
shall be brought for amicable settlement before the lupon of said barangay.
(b)Those involving actual residents of different barangays within the same city or
municipality shall be brought in the barangay where the respondent or any of the
respondents actually resides, at the election of the complainant.
(c)All disputes involving real property or any interest therein shall be brought in the
barangay where the real property or the larger portion thereof is situated.
(d)Those arising at the workplace where the contending parties are employed or at the
institution where such parties are enrolled for study shall be brought in the barangay
where such workplace or institution is located.
Objections to venue shall be raised in the mediation proceedings before the punong
barangay; otherwise, the same shall be deemed waived. Any legal question which may
confront the punong barangay in resolving objections to venue herein referred to may be
submitted to the Secretary of Justice or his duly designated representative whose ruling
thereon shall be binding. (Emphasis supplied)
In the 1982 case of Tavora v. Veloso,11 this Court held that where the parties are not
actual residents in the same city or municipality or adjoining barangays, there is no
requirement for them to submit their dispute to the lupon as provided for in Section 6 vis-
à-vis Sections 2 and 3 of P.D. 1508 (Katarungang Pambarangay Law).
13
De Joya Civil Procedure
[B]y express statutory inclusion and exclusion, the Lupon shall have no jurisdiction over
disputes where the parties are not actual residents of the same city or municipality,
except where the barangays in which they actually reside adjoin each other. (Italics
supplied)
In the 2000 case of Vercide v. Hernandez,12 this Court, noting that the Tavora ruling,
reiterated in other cases including the 1996 case of Agbayani13 cited by petitioner, was
decided under the provisions of P.D. No. 1508 (Katarungang Pambarangay) Law which
were, except for some modifications, echoed in Sections 408-409 of the Local Government
Code which took effect on January 1, 1992, held that the Tavora ruling remained.
To construe the express statutory requirement of actual residency as applicable to the
attorney-in-fact of the party-plaintiff, as contended by respondent, would abrogate the
meaning of a “real party in interest” as defined in Section 2 of Rule 314 of the 1997 Rules
of Court vis-à-vis Section 3 of the same Rule which was earlier quoted but misread and
misunderstood by respondent.
In fine, since the plaintiff-herein petitioner, the real party in interest, is not an actual
resident of the barangay where the defendant-herein respondent resides, the local lupon
has no jurisdiction over their dispute, hence, prior referral to it for conciliation is not a
pre-condition to its filing in court.
The RTC thus erred in dismissing petitioner’s complaint.
WHEREFORE, the petition is granted. The assailed February 10, 2003 Order, as well as the
March 24, 2003 Order denying reconsideration of the first, of Branch 23 of the Regional
Trial Court of Isabela at Roxas is SET ASIDE. Said court is accordingly directed to reinstate
Civil Case No. 23-713-02 to its docket and take appropriate action thereon with dispatch.
SO ORDERED.
Petition granted, assailed order and resolution set aside.
_______________
14 SEC. 2. Parties in interest.—A real party in interest is the party who stands to be
benefited or injured by the judgment in the suit, or the party entitled to the avails of the
suit. Unless otherwise authorized by law or these Rules, every action must be prosecuted
or defended in the name of the real party in interest.
Notes.—Judges should take judicial notice of the Local Government Code of 1991,
specifically on the provisions on the katarungang pambarangay, and a judge’s total
unawareness thereof is distressing. (Uy vs. Contreras, 237 SCRA 167 [1994])
KPL
The primordial objective of P.D. No. 1508 (The Katarungang Pambarangay Law), now
included under R.A. No. 7160 (the Local Government Code of 1991), is to reduce the
number of court litigations and prevent the deterioration of the quality of justice which
has been brought about by the indiscriminate filing of cases in the courts. (Zamora vs.
Heirs of Carmen-Izquierdo, 443 SCRA 24 [2004])

14
De Joya Civil Procedure KPL
A.C. No. 6296. November 22, 2005.*
ATTY. EVELYN J. MAGNO, complainant, vs. ATTY. OLIVIA VELASCO-JACOBA, respondent.
Legal Ethics; Attorneys; Code of Professional Responsibility; Local Government Code (LGC)
of 1991 [R.A. No. 7160]; Katarungang Pambarangay; Section 415 of the Local Government
Code (LGC) clearly requires the personal appearance of the parties in katarungang
pambarangay conciliation proceedings, unassisted by counsel or representative; There can
be no quibbling that laymen of good will can easily agree to conciliate and settle their
disputes between themselves without what sometimes is the unsettling assistance of
lawyers whose presence could sometimes obfuscate and confuse issues.—Section 415 of
the LGC of 1991, on the subject Katarungang Pambarangay, provides: Section 415.
Appearance of Parties in Person.—In all katarungang pambarangay proceedings, the
parties must appear in person without the assistance of the counsel or representative,
except for minors and incompetents who may be assisted by their next of kin who are not
lawyers. The above-quoted provision clearly requires the personal appearance of the
parties in katarungan pambarangay conciliation proceedings, unassisted by counsel or
representative. The rationale behind the personal appearance requirement is to enable
the lupon to secure first hand and direct information about the facts and issues, the
exception being in cases where minors or incompetents are parties. There can be no
quibbling that laymen of goodwill can easily agree to conciliate and settle their disputes
between themselves without what sometimes is the unsettling assistance of lawyers
whose presence could sometimes obfuscate and confuse issues. Worse still, the
participation of lawyers with their penchant to use their analytical skills and legal
knowledge tend to prolong instead of expedite settlement of the case.
Same; Same; Same; Same; Same; That the Sumbong was addressed to the barangay
captain instead of the lupong tagapamayapa is of no moment since the barangay captain
chairs the Lupong Tagapamayapa.—The prohibition against the presence of a lawyer in a
barangay conciliation proceedings was not, to be sure, lost on respondent. Her defense
that the aforequoted Section 415 of the LGC does not apply since complainant addressed
her Sumbong to the barangay captain of Brgy. San Pascual who thereafter proceeded to
hear the same is specious at best. In this regard, suffice it to state that complainant wrote
her Sumbong with the end in view of availing herself of the benefits of barangay justice.
That she addressed her Sumbong to the barangay captain is really of little moment since
the latter chairs the Lupong Tagapamayapa.
Same; Same; Same; Same; Same; The prohibition in Section 415 of the Local Government
Code (LGC) applies to all the katarungang barangay proceedings.—Lest it be overlooked,
the prohibition in question applies to all katarungan barangay proceedings. Section 412(a)
the LGC of 1991 clearly provides that, as a precondition to filing a complaint in court, the
parties shall go through the conciliation process either before the lupon chairman or the
15
De Joya Civil Procedure
lupon or pangkat. As what happened in this case, the punong barangay, as chairman of
the Lupon Tagapamayapa, conducted the conciliation proceedings to resolve the disputes
between the two parties.
ADMINISTRATIVE CASE in the Supreme Court. Willful Violation of Section 415 of the Local
Government Code of 1991 and Canon 4 of the Code of Professional Responsibility.
The facts are stated in the resolution of the Court.
RESOLUTION
GARCIA, J.:
In her sworn complaint, as endorsed by the President of the Integrated Bar of the
Philippines (IBP), Nueva Ecija Chapter, Atty. Evelyn J. Magno charged Atty. Olivia Velasco-
Jacoba, a member of the same IBP provincial chapter, with willful violation of (a) Section
415 of the Local Government Code (LGC) of 1991 and (b) Canon 4 of the Code of
Professional Responsibility.
This disciplinary case arose out of a disagreement that complainant had with her uncle,
Lorenzo Inos, over a landscaping contract they had entered into. In a bid to have the
stand-off between them settled, complainant addressed a letter, styled “Sumbong,”1 to
Bonifacio Alcantara, barangay captain of Brgy. San Pascual, Talavera, Nueva Ecija. At the
barangay conciliation/confrontation proceedings conducted on January 5, 2003,
respondent, on the strength of a Special Power of Attorney signed by Lorenzo Inos,
appeared for the latter, accompanied by his son, Lorenzito. Complainant’s objection to
respondent’s appearance elicited the response that Lorenzo Inos is entitled to be
represented by a lawyer inasmuch as complainant is herself a lawyer. And as to
complainant’s retort that her being a lawyer is merely coincidental, respondent countered
that she is appearing as an attorney-in-fact, not as counsel, of Lorenzo Inos.
Complainant enumerated specific instances, with supporting documentation, tending to
prove that respondent had, in the course of the conciliation proceedings before the
Punong Barangay, acted as Inos Lorenzo’s counsel instead of as his attorney-in-fact. This is
what complainant said in her complaint:2
“5.x x x Atty. Olivia Jacoba asked for an ocular inspection of the subject matter of the
complaint. A heated argument took place because Lorencito Inos said that [complainant’s
brother] Melencio Magno, Jr. made alterations in the lagoon …. Afterwards Atty. Olivia
Jacoba . . . returned to the barangay hall to have the incident recorded in the barangay
blotter.... attached as Annex “A”
KPL
6.That on January 12, 2003, … Lorenzo Inos appeared before the hearing also with the
assistance of [respondent]. When the minutes of the proceeding (sic) was read,
[respondent] averred that the minutes is partial in favor of the complainant because only
her statements were recorded for which reason, marginal insertions were made to include
what [respondent] wanted to be put on record. She also signed as “saksi” in the minutes
….
7.x x x In a letter (answer to the “sumbong”) sent to the Punong Barangay dated
December 22, 2002, she signed representing herself as “Family Legal Counsel of Inos
Family,” a copy of the letter is attached as Annex “C” . . . . (Words in bracket added.)
In an Order dated February 17, 2003, Atty. Victor C. Fernandez, IBP Director for Bar
Discipline, directed the respondent to submit, within fifteen (15) days from notice, her
answer to the complaint, otherwise she will be considered as in default.3
The case, docketed as CBD No. 03-1061, was assigned to Commissioner Rebecca
Villanueva-Maala, who admitted respondent’s answer notwithstanding her earlier order
of July 15, 2003, declaring respondent in default for failure to file an answer in due time.4
In her Answer, respondent alleged that the administrative complaint was filed with the
Office of the Punong Barangay, instead of before the Lupong Tagapamayapa, and heard by
Punong Barangay Bonifacio Alcantara alone, instead of the collegial Lupon or a conciliation
panel known as pangkat. Prescinding from this premise, respondent submits that the
prohibition against a lawyer appearing to assist a client in katarungan pambarangay
proceedings does not apply. Further, she argued that her appearance was not as a lawyer,
but only as an attorney-in-fact.
In her report dated October 6, 2003,5 Commissioner Maala stated that the “charge of
complainant has been established by clear preponderance of evidence” and, on that basis,
recommended that respondent be suspended from the practice of her profession for a
period of six (6) months. On the other hand, the Board of Governors, IBP Commission on
Bar Discipline, while agreeing with the inculpatory finding of the investigating
commissioner, recommended in its Resolution No. XVI-2003-235,6 a lighter penalty, to
wit:
“RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and APPROVED, the Report
and Recommendation of the Investigating Commissioner of the above-entitled case,
herein made part of this Resolution/Decision as Annex “A”; and, finding the
recommendation fully supported by the evidence on record and the applicable laws and
rules, with modification, and considering respondent's actuations was in violation of
Section 415 which expressly prohibits the presence and representation by lawyers in the
Katarungan Pambarangay, Atty. Olivia Velasco-Jacoba is hereby ADMONISHED.
16
De Joya Civil Procedure
This resolution is now before us for confirmation.
Section 415 of the LGC of 1991,7 on the subject Katarungang Pambarangay, provides:
“Section 415. Appearance of Parties in Person.—In all katarungang pambarangay
proceedings, the parties must appear in person without the assistance of the counsel or
representative, except for minors and incompetents who may be assisted by their next of
kin who are not lawyers.”
The above-quoted provision clearly requires the personal appearance of the parties in
katarungan pambarangay con-
_______________
7 Rep. Act 7160, which took effect on January 1, 1992. The law on barangay conciliation
was originally governed by PD No. 1508 (enacted on June 11, 1978).
ciliation proceedings, unassisted by counsel or representative. The rationale behind the
personal appearance requirement is to enable the lupon to secure first hand and direct
information about the facts and issues,8 the exception being in cases where minors or
incompetents are parties. There can be no quibbling that laymen of goodwill can easily
agree to conciliate and settle their disputes between themselves without what sometimes
is the unsettling assistance of lawyers whose presence could sometimes obfuscate and
confuse issues.9 Worse still, the participation of lawyers with their penchant to use their
analytical skills and legal knowledge tend to prolong instead of expedite settlement of the
case.
The prohibition against the presence of a lawyer in a barangay conciliation proceedings
was not, to be sure, lost on respondent. Her defense that the aforequoted Section 415 of
the LGC does not apply since complainant addressed her Sumbong to the barangay
captain of Brgy. San Pascual who thereafter proceeded to hear the same is specious at
best. In this regard, suffice it to state that complainant wrote her Sumbong with the end in
view of availing herself of the benefits of barangay justice. That she addressed her
Sumbong to the barangay captain is really of little moment since the latter chairs the
Lupong Tagapamayapa.10
Lest it be overlooked, the prohibition in question applies to all katarungan barangay
proceedings. Section 412(a)11 the
_______________
11 Section 412. Conciliation.—
KPL
 (a) Pre-condition to Filing of Complaint in Court.—No complaint, petition, action or
proceeding involving any matter within the authority of the lupon shall be filed or
instituted directly in court or any other government office for adjudication, unless there
has been a confrontation between the parties before the lupon chairman or the pangkat,
and that no concilia tion or settlement has been reached as certified by the lupon secretary
or pangkat secretary as attested to by the lupon or pangkat chairman or unless the
settlement has been repudiated by the parties thereto.

LGC of 1991 clearly provides that, as a precondition to filing a complaint in court, the
parties shall go through the conciliation process either before the lupon chairman or the
lupon or pangkat. As what happened in this case, the punong barangay, as chairman of
the Lupon Tagapamayapa, conducted the conciliation proceedings to resolve the disputes
between the two parties.

Given the above perspective, we join the IBP Commission on Bar Discipline in its
determination that respondent transgressed the prohibition prescribed in Section 415 of
the LGC. However, its recommended penalty of mere admonition must have to be
modified. Doubtless, respondent’s conduct tended to undermine the laudable purpose of
the katarungan pambarangay system. What compounded matters was when respondent
repeatedly ignored complainant’s protestation against her continued appearance in the
barangay conciliation proceedings.

WHEREFORE, Atty. Olivia Velasco-Jacoba is hereby FINED in the amount of Five Thousand
Pesos (P5,000.00) for willful violation of Section 415 of the Local Government Code of
1991 with WARNING that commission of similar acts of impropriety on her part in the
future will be dealt with more severely. SO ORDERED.

Notes.—A party’s act of trifling with the authority of the lupon by unjustifiably failing to
attend the scheduled mediation hearings and instead filing the complaint right away with
the trial court cannot be countenanced. (Uy vs. Contreras, 237 SCRA 167 [1994])

There is substantial compliance with the law even though no pangkat was constituted if
the parties met at the office of the barangay chairman for possible settlement yet the
efforts of the barangay chairman proved futile. (Diu vs. Court of Appeals, 251 SCRA 472
[1995])

It is clear from the Katarungang Pambarangay Rules that recourse to barangay conciliation
proceedings is not necessary where the parties do not reside in the same municipality or
city or in adjoining barangays. (Vercide vs. Hernandez,330 SCRA 49 [2000])

17
De Joya Civil Procedure KPL
G.R. No. 146195. November 18, 2004*
AVELINA ZAMORA, EMERITA ZAMORA-NICOL, SONNY NICOL, TERESA ZAMORA-UMALI,
CLARENCE UMALI, ROBERTO ZAMORA, ROLANDO ZAMORA, MARY ANN ZAMORA,
MICHELLE ZAMORA and RODRIGO ZAMORA, petitioners, vs. HEIRS OF CARMEN
IZQUIERDO, REPRESENTED BY THEIR ATTORNEY-IN-FACT, ANITA F. PUNZALAN,
respondents.
Actions; Katarungang Pambarangay Law; The primordial objective of P.D. No. 1508 (The
Katarungang Pambarangay Law), now included under R.A. No. 7160 (the Local
Government Code of 1991), is to reduce the number of court litigations and prevent the
deterioration of the quality of justice which has been brought about by the indiscriminate
filing of cases in the courts.—The primordial objective of Presidential Decree No. 1508
(the Katarungang Pambarangay Law), now included under R.A. No. 7160 (the Local
Government Code of 1991), is to reduce the number of court litigations and prevent the
deterioration of the quality of justice which has been brought about by the indiscriminate
filing of cases in the courts. To attain this objective, Section 412(a) of R.A. No. 7160
requires the parties to undergo a conciliation process before the Lupon Chairman or the
Pangkat as a precondition to filing a complaint in court, thus: “SECTION 412. Conciliation.
—(a) Pre-condition to Filing of Complaint in Court.—No complaint, petition, action, or
proceeding involving any matter within the authority of the Lupon shall be filed or
instituted directly in court or any other government office for adjudication, unless there
has been a confrontation between the parties before the lupon chairman or the pangkat,
and that no conciliation or settlement has been reached as certified by the lupon or
pangkat secretary and attested to by the lupon or pangkat chairman x x x.”
Same; Same; Section 412(a) of R.A. No. 7160 clearly provides that, as a precondition to
filing a complaint in court, the parties shall go through the conciliation process either
before the Lupon Chairman or the Pangkat.—We cannot sustain petitioners’ contention
that the Lupon conciliation alone, without the proceeding before the Pangkat ng
Tagapagkasundo, contravenes the law on Katarungang Pambarangay. Section 412(a) of
R.A. No. 7160, quoted earlier, clearly provides that, as a precondition to filing a complaint
in court, the parties shall go through the conciliation process either before the Lupon
Chairman (as what happened in the present case), or the Pangkat. Moreover, in Diu vs.
Court of Appeals, we held that “notwithstanding the mandate in Section 410(b) of R.A. No.
7160 that the Barangay Chairman shall constitute a Pangkat if he fails in his mediation
efforts,” the same “Section 410(b) should be construed together with Section 412(a) of
the same law (quoted earlier), as well as the circumstances obtaining in and peculiar to
the case.” Here, while the Pangkat was not constituted, however, the parties met nine (9)
times at the Office of the Barangay Chairman for conciliation wherein not only the issue of
water installation was discussed but also petitioners’ violation of the lease contract. It is
18
De Joya Civil Procedure
thus manifest that there was substantial compliance with the law which does not require
strict adherence thereto.
Same; Same; Ejectment; Unlawful Detainer; Motions to Dismiss; Revised Rule on Summary
Procedure; A motion to dismiss may only be filed in an action for unlawful detainer if
anchored on lack of jurisdiction over the subject matter, or failure by the complainant to
refer the subject matter of his/her complaint to the Lupon for conciliation prior to its filing
with the court.—We hold that petitioners’ motion to dismiss the complaint for unlawful
detainer is proscribed by Section 19(a) of the 1991 Revised Rule on Summary Procedure,
quoted earlier. Section 19(a) permits the filing of such pleading only when the ground for
dismissal of the complaint is anchored on lack of jurisdiction over the subject matter, or
failure by the complainant to refer the subject matter of his/her complaint “to the Lupon
for conciliation” prior to its filing with the court. This is clear from the provisions of Section
18 of the same Rule, which reads: “SEC. 18. Referral to Lupon.—Cases requiring referral to
the Lupon for conciliation under the provisions of Presidential Decree No. 1508 where
there is no showing of compliance with such requirement, shall be dismissed without
prejudice, and may be revived only after such requirement shall have been complied with.
This provision shall not apply to criminal cases where the accused was arrested without a
warrant.”
PETITION for review on certiorari and resolution of the Court of Appeals.
The facts are stated in the opinion of the Court.
     Emmanuel M. Basa for petitioners.
     Salonga, Hernandez & Mendoza for respondents.
SANDOVAL-GUTIERREZ, J.:
Before us is a petition for review on certiorari1 assailing the Decision2 of the Court of
Appeals dated September 12, 2000 and its Resolution dated December 1, 2000 in CA-G.R.
SP No. 54541, entitled “Avelina Zamora, et al., petitioners, versus Heirs of Carmen
Izquierdo, represented by the executrix, Anita F. Punzalan, respondents.”
The records show that sometime in 1973, Carmen Izquierdo and Pablo Zamora entered
into a verbal stipulation whereby the former leased to the latter one of her apartment
units located at 117-B General Luna Street, Caloocan City. They agreed on the following:
the rental is P3,000.00 per month; the leased premises is only for residence; and only a
single family is allowed to occupy it.
After the death of Carmen (lessor) in 1996 her attorney-in-fact, Anita Punzalan,
representing the heirs, herein respondents, prepared a new contract of lease wherein the
KPL
rental was increased from P3,000.00 to P3,600.00 per month.3 However, petitioners
refused to sign it.
In January 1997, Pablo (lessee) died. His wife, Avelina Zamora, and their children (two of
whom have their own families), herein petitioners, continued to reside in the apartment
unit. However, they refused to pay the increased rental and persisted in operating a
photocopying business in the same apartment.
Meanwhile, petitioner Avelina Zamora applied with the Metropolitan Waterworks &
Sewerage System (MWSS) for a water line installation in the premises. Since a written
consent from the owner is required for such installation, she requested respondents’
attorney-in-fact to issue it. However, the latter declined because petitioners refused to
pay the new rental rate and violated the restrictions on the use of the premises by using a
portion thereof for photocopying business and allowing three families to reside therein.
This prompted petitioner Avelina Zamora to file with the Office of the Punong Barangay of
Barangay 16, Sona 2, District I, Lungsod ng Caloocan, a complaint against Anita Punzalan
(respondents’ attorney-in-fact), docketed as “Usaping Bgy. Blg. 1-27-97, Ukol sa: Hindi
Pagbibigay ng Pahintulot sa Pagpapakabit ng Tubig.”
On August 24, 1997, during the barangay conciliation proceedings, petitioner Avelina
Zamora declared that she refused to sign the new lease contract because she is not
agreeable with the conditions specified therein.
The following day, Anita Punzalan sent Avelina a letter4 informing her that the lease is
being terminated and demanding that petitioners vacate the premises within 30 days
from notice.
Despite several barangay conciliation sessions, the parties failed to settle their dispute
amicably. Hence, the Barangay Chairman issued a Certification to File Action dated
September 14, 1997.5
Consequently, on October 2, 1997, respondents, represented by Anita Punzalan, filed with
the Metropolitan Trial Court (MTC), Branch 49, Caloocan City, a complaint for unlawful
detainer and damages against petitioners, docketed as Civil Case No. 23702.6 Forthwith,
petitioners filed a motion to dismiss7 the complaint on the ground that the controversy
was not referred to the barangay for conciliation. First, they alleged that the barangay
Certification to File Action “is fatally defective” because it pertains to another dispute, i.e.,
the refusal by respondents’ attorney-in-fact to give her written consent to petitioners’
request for installation of water facilities in the premises. And, second, when the parties
failed to reach an amicable settlement before the Lupong Tagapamayapa, the Punong
19
De Joya Civil Procedure
Barangay (as Lupon Chairman), did not constitute the Pangkat ng Tagapagkasundo before
whom mediation or arbitration proceedings should have been conducted, in violation of
Section 410(b), Chapter 7 (Katarungang Pambarangay), Title One, Book III of Republic Act
No. 71608 (otherwise known as the Local Government Code of 1991), which reads:
“SECTION 410. Procedure for Amicable Settlement.—
(a)x x x
(b)Mediation by lupon chairman—Upon receipt of the complaint, the lupon chairman9
shall, within the next working day, summon the respondent(s), with notice to the
complainant(s) for them and their witnesses to appear before him for a mediation of their
conflicting interests. If he fails in his mediation effort within fifteen (15) days from the first
meeting of the parties before him, he shall forthwith set a date for the constitution of the
pangkat in accordance with the provisions of this Chapter.” (Italics supplied)
Respondents opposed the motion to dismiss,10 the same being prohibited under Section
19 of the 1991 Revised Rule on Summary Procedure. They prayed that judgment be
rendered as may be warranted by the facts alleged in the complaint, pursuant to Section
611 of the same Rule.
On July 9, 1998, the MTC issued an Order12 denying petitioners’ motion to dismiss and
considering the case submitted for decision in view of their failure to file their answer to
the complaint.
_______________
11 Section 6 of the Revised Rule on Summary Procedure provides:
“SEC. 6. Effect of failure to answer.—Should the defendant fail to answer the complaint
within the period above provided [10 days from service of summons], the court, motu
proprio, or on motion of the plaintiff, shall render judgment as may be warranted by the
facts alleged in the complaint and limited to what is prayed for therein: Provided, however,
That the court may in its discretion reduce the amount of damages and attorney’s fees
claimed for being excessive or otherwise unconscionable. This is without prejudice to the
applicability of Section 4, Rule 18 of the Rules of Court, if there are two or more
defendants.”
Petitioners filed a motion for reconsideration,13 contending that a motion to dismiss the
complaint on the ground of failure to refer the complaint to the Lupon for conciliation is
allowed under Section 19 of the 1991 Revised Rule on Summary Procedure, which partly
provides:
“SEC. 19. Prohibited pleadings and motions.—The following pleadings, motions, or
petitions shall not be allowed in the cases covered by this Rule:
KPL

(a) Motion to dismiss the complaint or to quash the complaint or information except on
the ground of lack of jurisdiction over the subject matter, or failure to comply with the
preceding section [referring to Section 18 on referral of the complaint to the Lupon for
conciliation];
x x x.”
On August 26, 1998, the MTC rendered a Judgment14 in favor of respondents and against
petitioners, the dispositive portion of which reads:
“WHEREFORE, Judgment is hereby rendered in favor of the plaintiff and against the
defendants, ordering defendants and all persons claiming right under them:
1)To vacate the leased premises located at No. 117-B General Luna Street, Caloocan City
and to surrender possession thereof to the plaintiff;
2)To pay the amount of three thousand six hundred (P3,600.00) pesos per month starting
January, 1997 until the premises being occupied by them is finally vacated and possession
thereof is restored to the plaintiff;
3)To pay plaintiff the sum of five thousand (P5,000.00) pesos as and for attorney’s fees;
and
4)To pay the costs of this suit.
SO ORDERED.”
On appeal, the Regional Trial Court (RTC), Branch 125, Caloocan City, rendered its
Decision15 dated February 15, 1999 affirming the MTC Judgment. Subsequently, it denied
petitioners’ motion for reconsideration.16
Petitioners then filed with the Court of Appeals a petition for review, docketed as CA-G.R.
SP No. 54541. On September 12, 2000, it rendered a Decision17 affirming the RTC
Decision. Thereafter, petitioners filed a motion for reconsideration but was denied by the
Appellate Court in its Resolution dated December 1, 2000.18
Hence, the instant petition.
I filing of the instant case would not serve any useful purpose anymore since no new issues
The primordial objective of Presidential Decree No. 1508 (the Katarungang Pambarangay
Law), now included under R.A. No. 7160 (the Local Government Code of 1991), is to
reduce the number of court litigations and prevent the deterioration of the quality of
justice which has been brought about by the indiscriminate filing of cases in the courts.19
To attain this objective, Section 412(a) of R.A. No. 7160 requires the parties to undergo a
20
De Joya Civil Procedure
conciliation process before the Lupon Chairman or the Pangkat as a precondition to filing
a complaint in court, thus:
“SECTION 412. Conciliation.—(a) Pre-condition to Filing of Complaint in Court.—No
complaint, petition, action, or proceeding involving any matter within the authority of the
lupon shall be filed or instituted directly in court or any other government office for
adjudication, unless there has been a confrontation between the parties before the lupon
chairman or the pangkat, and that no conciliation or settlement has been reached as
certified by the lupon or pangkat secretary and attested to by the lupon or pangkat
chairman x x x.” (Italics supplied)
In the case at bar, the Punong Barangay, as Chairman of the Lupong Tagapamayapa,
conducted conciliation proceedings to resolve the dispute between the parties herein.
Contrary to petitioners’ contention, the complaint does not only allege, as a cause of
action, the refusal of respondents’ attorney-in-fact to give her consent to the installation
of water facilities in the premises, but also petitioners’ violation of the terms of the lease,
specifically their use of a portion therein for their photocopying business and their failure
to pay the increased rental. As correctly found by the RTC:
“The records show that confrontations before the barangay chairman were held on
January 26, 1997, February 9, 1997, February 23, 1997, February 28, 1997, July 27, 1997,
August 3, 1997, August 10, 1997, August 17, 1997 and August 24, 1997 wherein not only
the issue of water installation was discussed but also the terms of the lease and the
proposed execution of a written contract relative thereto. It appears, however, that no
settlement was reached despite a total of nine meetings at the barangay level.
It is of no moment that the complaint was initially made by defendant-appellant Avelina
Zamora because herein plaintiff-appellee was given by the Sangguniang Barangay the
authority to bring her grievance to the Court for resolution. While it is true that the
Sertifikasyon dated September 14, 1997 is entitled ‘Ukol Sa Hindi Pagbibigay Ng Pahintulot
Sa Pagpapakabit Ng Tubig’, this title must not prevail over the actual issues discussed in
the proceedings.
Hence, to require another confrontation at the barangay level as a sine qua non for the
would be raised therein and the parties have proven so many times in the past that they
cannot get to settle their differences amicably.”20
We cannot sustain petitioners’ contention that the Lupon conciliation alone, without the
proceeding before the Pangkat ng Tagapagkasundo, contravenes the law on Katarungang
Pambarangay. Section 412(a) of R.A. No. 7160, quoted earlier, clearly provides that, as a
KPL
precondition to filing a complaint in court, the parties shall go through the conciliation Notes.—Judges should take judicial notice of the Local Government Code of 1991,
process either before the Lupon Chairman (as what happened in the present case), or the specifically on the provisions on the katarungang pambarangay, and a judge’s total
Pangkat. unawareness thereof is distressing. (Uy vs. Contreras, 237 SCRA 167 [1994])

Moreover, in Diu vs. Court of Appeals,21 we held that “notwithstanding the mandate in
Section 410(b) of R.A. No. 7160 that the Barangay Chairman shall constitute a Pangkat if
he fails in his mediation efforts,” the same “Section 410(b) should be construed together
with Section 412(a) of the same law (quoted earlier), as well as the circumstances
obtaining in and peculiar to the case.” Here, while the Pangkat was not constituted,
however, the parties met nine (9) times at the Office of the Barangay Chairman for
conciliation wherein not only the issue of water installation was discussed but also
petitioners’ violation of the lease contract. It is thus manifest that there was substantial
compliance with the law which does not require strict adherence thereto.22
There is substantial compliance with the law even though no pangkat was constituted if
the parties met at the office of the barangay chairman for possible settlement yet the
efforts of the barangay chairman proved futile. (Diu vs. Court of Appeals, 251 SCRA 472
[1995])
It is clear from the Katarungang Pambarangay Rules that recourse to barangay conciliation
proceedings is not necessary where the parties do not reside in the same municipality or
city or in adjoining barangays. (Vercide vs. Hernandez, 330 SCRA 49 [2000]) Zamora vs.
Heirs of Carmen Izquierdo, 443 SCRA 24, G.R. No. 146195 November 18, 2004

II

We hold that petitioners’ motion to dismiss the complaint for unlawful detainer is
proscribed by Section 19(a) of the 1991 Revised Rule on Summary Procedure, quoted
earlier. Section 19(a) permits the filing of such pleading only when the ground for
dismissal of the complaint is anchored on lack of jurisdiction over the subject matter, or
failure by the complainant to refer the subject matter of his/her complaint “to the Lupon
for conciliation” prior to its filing with the court. This is clear from the provisions of Section
18 of the same Rule, which reads:

“SEC. 18. Referral to Lupon.—Cases requiring referral to the Lupon for conciliation under
the provisions of Presidential Decree No. 1508 where there is no showing of compliance
with such requirement, shall be dismissed without prejudice, and may be revived only
after such requirement shall have been complied with. This provision shall not apply to
criminal cases where the accused was arrested without a warrant.” (Italics supplied)

As discussed earlier, the case was referred to the Lupon Chairman for conciliation.
Obviously, petitioners’ motion to dismiss, even if allowed, is bereft of merit.

WHEREFORE, the petition is DENIED. The assailed Decision and Resolution of the Court of
Appeals in CA-G.R. SP No. 54541 sustaining the Decision of the RTC which upheld the MTC
Judgment is AFFIRMED. Costs against petitioners. SO ORDERED.

Petition denied, assailed decision and resolution affirmed.

21
De Joya Civil Procedure KPL
No. L-63277. November 29, 1983.*
PETRA VDA. DE BORROMEO, petitioner, vs. HON. JULIAN B. POGOY, Municipal/City Trial
Court of Cebu City, and ATTY. RICARDO REYES, respondents.
Remedial Law; Special Civil Actions; Forcible entry and detainer; Prescription; Prescriptive
period for filing actions for forcible entry and detainer.—Under Article 1147 of the Civil
Code, the period for filing actions for forcible entry and detainer is one year, and this
period is counted from demand to vacate the premises.
Same; Same; Same; PD 1508 or Katarungang Pambarangay Law; Conciliation process at
the barangay level condition precedent for filing actions in applicable cases under PD
1508; Failure of complaint to allege compliance with the requirement of referral of case
first to the barangay courts under PD 1508, fatal.—While respondent acknowledged said
Circular in his order of December 14, 1982, he nevertheless chose to overlook the failure
of the complaint in Civil Case No. R-23915 to allege compliance with the requirement of
PD 1508. Neither did he cite any circumstance as would place the suit outside the
operation of said law. Instead, he insisted on relying upon the pro tanto presumption of
regularity in the performance by the clerk of court of his official duty, which to Our mind
has been sufficiently overcome by the disclosure by the Clerk of Court that there was no
certification to file action from the Lupon or Pangkat secretary attached to the complaint.
Same; Same; Same; Same; Words and phrases; Word "individual" in Section 4a of PD 1508
applies only to cases involving natural persons.—Be that as it may, the instant petition
should be dismissed. Under Section 4(a) of PD No. 1508, referral of a dispute to the
Barangay Lupon is required only where the parties thereto are "individuals". An
"individual" means "a single human being as contrasted with a social group or institution."
Obviously, the law applies only to cases involving natural persons, and not where any of
the parties is a juridical person such as a corporation, partnership, corporation sole,
testate or intestate, estate, etc.
PETITION for certiorari to review the order of the Municipal Trial Court of Cebu City.
The facts are stated in the opinion of the Court.
     Antonio T. Uy for petitioner.
     Numeriano G. Estenzo for respondents.
ESCOLIN, J.:
Petitioner herein seeks to stop respondent Judge Julian B. Pogoy of the Municipal Trial
Court of Cebu City from taking cognizance of an ejectment suit for failure of the plaintiff to
refer the dispute to the Barangay Lupon for conciliation.
22
De Joya Civil Procedure
The intestate estate of the late Vito Borromeo is the owner of a building bearing the
deceased's name, located at F. Ramos St., Cebu City. Said building has been leased and
occupied by petitioner Petra Vda. de Borromeo at a monthly rental of P500.00 payable in
advance within the first five days of the month.
On August 28, 1982, private respondent Atty. Ricardo Reyes, administrator of the estate
and a resident of Cebu City, served upon petitioner a letter demanding that she pay the
overdue rentals corresponding to the period from March to September 1982, and
thereafter to vacate the premises. As petitioner failed to do so, Atty. Reyes instituted on
September 16, 1982 an ejectment case against the former in the Municipal Trial Court of
Cebu City. The complaint was docketed as Civil Case No. R-23915 and assigned to the sala
of respondent judge.
On November 12, 1982, petitioner moved to dismiss the case, advancing, among others,
the want of jurisdiction of the trial court. Pointing out that the parties are residents of the
same city, as alleged in the complaint, petitioner contended that the court could not
exercise jurisdiction over the case for failure of respondent Atty. Reyes to refer the
dispute to the Barangay Court, as required by PD No. 1508, otherwise known as
Katarungang Pambarangay Law.
Respondent judge denied the motion to dismiss. He justified the order in this wise:
"The Clerk of Court when this case was filed accepted for filing same. That from the
acceptance from (sic) filing, with the plaintiff having paid the docket fee to show that the
case was docketed in the civil division of this court could be considered as meeting the
requirement or precondition for were it not so, the Clerk of Court would not have
accepted the filing of the case especially that there is a standing circular from the Chief
Justice of the Supreme Court without even mentioning the Letter of Instruction of the
President of the Philippines that civil cases and criminal cases with certain exceptions
must not be filed without passing the barangay court." (Order dated December 14,1982,
Annex "c", P. 13, Rollo).
Unable to secure a reconsideration of said order, petitioner came to this Court through
this petition for certiorari. In both his comment and memorandum, private respondent
admitted not having availed himself of the barangay conciliation process, but justified
such omission by citing paragraph 4, section 6 of PD 1508 which allows the direct filing of
an action in court where the same may otherwise be barred by the Statute of Limitations,
as applying to the case at bar.
KPL
The excuse advanced by private respondent is unsatisfactory, Under Article 1147 of the
Civil Code, the period for filing actions for forcible entry and detainer is one year,1 and
this period is counted from demand to vacate the premises.2
In the case at bar, the letter-demand mand was dated August 28, 1982, while the
complaint for ejectment was filed in court on September 16, 1982. Between these two
dates, less than a month had elapsed, thereby leaving at least eleven (11) full months of
the prescriptive period provided for in Article 1147 of the Civil Code. Under the procedure
outlined in Section 4 of PD 1508,3 the time needed for the conciliation proceeding
_________________
1 Article 1147 of the Civil Code.
2 Desbarat vs. Vda. de Laureano, 18 SCRA 116, Calubayan vs. Pascual, 21 SCRA 146,
Development Bank of the Philippines vs. Canonoy, 35 SCRA 197.
3 SECTION 4, Procedure for amicable settlement—
a) Who may initiate proceedings.—Any individual who has a cause of action against
another individual involving any matter within the authority of the Lupon as provided in
Section 2 may complain orally or in writing, to the Barangay Captain of the barangay
referred to in Section 3 hereof. ,
b) Mediation by Barangay Captain.—Upon receipt of the complaint, the Barangay Captain
shall within the next working day summon the respondent/s, with notice to the
complainant/s for them and their witnesses to appear before him for a mediation of their
conflicting interests. If he fails in his effort within fifteen (15) days from the first meeting of
the parties before him, he shall forthwith set a date for the constitution of the Pangkat in
accordance with the provisions of Section 1 of this Decree.
c) Hearing before the Pangkat.—The Pangkat shall convene no later than three (3) days
from its constitution on the day and hour set by the Barangay Captain, to hear both parties
and their witnesses, simplify issues and explore all possibilities for amicable settlement. x x
x
x x x           x x x           x x x
e) Time limit.—The Pangkat shall arrive at a settlement/resolution of the dispute within
fifteen (15) days from the day it convenes in accordance with paragraph (c) hereof. This
period, shall at the discretion of the Pangkat, be extendible for another period which shall
not exceed fifteen (15) days except in clearly meritorious cases."
before the Barangay Chairman and the Pangkat should take no more than 60 days. Giving
private respondent nine (9) months—ample time indeed—within which to bring his case
23
De Joya Civil Procedure
before the proper court should conciliation efforts fail. Thus, it cannot be truthfully
asserted, as private respondent would want Us to believe, that his case would be barred
by the Statute of Limitations if he had to course his action to the Barangay Lupon.
With certain exceptions, PD 1508 makes the conciliation process at the Barangay level a
condition precedent for filing of actions in those instances where said law applies. For this
reason, Circular No. 22 addressed to " ALL JUDGES OF THE COURTS OF FIRST INSTANCE,
CIRCUIT CRIMINAL COURTS, JUVENILE AND DOMESTIC RELATIONS COURT, COURTS OF
AGRARIAN RELATIONS, CITY COURTS, MUNICIPAL COURTS AND THEIR CLERKS OF COURT"
was issued by Chief Justice Enrique M. Fernando on November 9, 1979. Said Circular
reads:
"Effective upon your receipt of the certification by the Minister of Local Government and
Community Development that all the barangays within your respective jurisdictions have
organized their Lupons provided for in Presidential Decree No. 1508, otherwise known as
the Katarungang Pambarangay Law, in implementation of the barangay system of
settlement of disputes, you are hereby directed to desist from receiving complaints,
petitions, actions or proceedings in cases falling within the authority of said Lupons. "
While respondent acknowledged said Circular in his order of December 14, 1982, he
nevertheless chose to overlook the failure of the complaint in Civil Case No. R-23915 to
allege compliance with the requirement of PD 1508. Neither did he cite any circumstance
as would place the suit outside the operation of said law. Instead, he insisted on relying
upon the pro tanto presumption of regularity in the performance by the clerk of court of
his official duty, which to Our mind has been sufficiently overcome by the disclosure by
the Clerk of Court that there was no certification to file action from the Lupon or Pangkat
secretary attached to the complaint.4
Be that as it may, the instant petition should be dismissed. Under Section 4(a) of PD No.
1508, referral of a dispute to the Barangay Lupon is required only where the parties
thereto are "individuals", An "individual" means "a single human being as contrasted with
a social group or institution."5 Obviously, the law applies only to cases involving natural
persons, and not where any of the parties is a juridical person such as a corporation,
partnership, corporation sole, testate or intestate, estate, etc,
In Civil Case No. R-23915, plaintiff Ricardo Reyes is a mere nominal party who is suing in
behalf of the Intestate Estate of Vito Borromeo. While it is true that Section 3, Rule 3 of
the Rules of Court allows the administrator of an estate to sue or be sued without joining
the party for whose benefit the action is presented or defended, it is indisputable that the
real party in interest in Civil Case No. R-23915 is the intestate estate under administration.
KPL
Since the said estate is a juridical person6 plaintiff administrator may file the complaint
directly in court, without the same being coursed to the Barangay Lupon for arbitration.

ACCORDINGLY, the petition is hereby dismissed. Respondent judge is ordered to try and
decide Civil Case No. R-23915 without unnecessary delay. No costs.

SO ORDERED.
Petition dismissed

Notes.—Fact that the owner made the tenant understand that he may need the premises
in the future is not sufficient basis to terminate a leasehold relationship. (F.S. Divinagracia
Agro-Commercial vs. Court of Appeals, 104 SCRA 180.)

In case the defendant fails to make the monthly deposit of current rentals, it is generally
mandatory for the court to order execution of the appealed judgment. (Dehesa vs.
Macalalag, 81 SCRA 543.)

The remedy of the tenant where the lessor refuses to make urgent repair of the leased
premises is not to suspend rental payments, but to make urgent repair himself and charge
the cost thereof to the lessor under Art. 1663 of the Civil Code. (Banson vs. Ubay, 94 SCRA
454.)

A mere caretaker of land is without right to possession of the disputed land. (Dalida vs.
Court of Appeals, 117 SCRA 480.)

24
De Joya Civil Procedure KPL
G.R. No. 83907.September 13, 1989.*
NAPOLEON GEGARE, petitioner, vs. HON. COURT OF APPEALS (ELEVENTH DIVISION) AND
ARMIE ELMA, respondents.
Civil Procedure; Certiorari; Writ of certiorari or prohibition, available even in respect to
interlocutory orders.—It is precisely to correct the lower court when in the course of
proceedings it acts without jurisdiction or in excess thereof or if the trial court judge
otherwise acted with grave abuse of discretion that the extraordinary writ of certiorari or
prohibition is afforded to parties as a relief. Such writ is available even in respect to
interlocutory orders.
Same; Courts; Administrative Law; Courts of justice will not interfere with pure
administrative matters rendered by administrative bodies within the scope of their power
and authority.—The appellate court correctly ruled that courts of justice will not interfere
with purely administrative matters rendered by administrative bodies or officials acting
within the scope of their power and authority. The discretionary power vested in the
proper executive official, in the absence of arbitrariness or grave abuse so as to go beyond
the statutory authority, is not subject to the contrary judgment or control of the courts
and is treated with finality.
Same; Parties; Petitioner is not a party-in-interest who can seek the nullification of the
land grant.—Moreover, petitioner had no capacity to file the questioned suit in the lower
court. The real party-in-interest who can seek the nullification of the land grant is the
government or the state.
Same; Katarungang Pambarangay (PD 1508); When the government or its instrumentality
is only one of the contending parties, a confrontation should still be undertaken among
the other parties.—The purpose of this confrontation is to enable the parties to settle
their differences amicably. If the other only contending party is the government or its
instrumentality or subdivision the case falls within the exception but when it is only one of
the contending parties, a confrontation should still be undertaken among the other
parties.
PETITION to review the decision of the Court of Appeals.
The facts are stated in the opinion of the Court.
     Camilo Cariño Dionio, Jr. for petitioner.
     Cedo, Ferrer & Associates Law Offices for private respondent.
GANCAYCO, J.:
25
De Joya Civil Procedure
The familiar story in the Old Testament is of how King Solomon settled the dispute
between two women over a child by deciding that the child be cut into two for them to
share. The real mother full of love implored that the King not kill the child and give the
child to the other woman. The latter asked the King not to give it to either of them and to
go on, cut the child into two.
This case involves a small piece of land. The decision was to cut it into two between the
parties. But the parallel ends there. The petitioner wants the whole lot. Private
respondent is happy with his half. This is the impasse’ that must be resolved.
The center of controversy is Lot 5989, Ts-217 with an area of about 270 square meters
situated at Dadiangas, General Santos City. This lot was titled in the name of Paulino Elma
under Original Certificate of Title No. (P-29947) (P-11503) P-1987 issued by the Office of
the Register of Deeds of General Santos City and Miscellaneous Sales Patent No. V-635. A
reversion case was filed by the Republic of the Philippines against Paulino Elma in the
Court of First Instance of South Cotabato docketed as Civil Case No. 950, wherein in due
course a decision was rendered on January 29, 1973 declaring the title of Paulino Elma
null and void and the same was ordered cancelled. The lot was reverted to the mass of
public domain subject to disposition and giving preferential right to its actual occupant,
Napoleon Gegare.
This decision was affirmed by this Court when We dismissed the petition for review on
certiorari filed by the heirs of Elma on March 13, 1974 in G.R. No. L-38069. Thereafter, the
writ of execution was issued and the title of Elma to the property was cancelled.
Both petitioner and private respondent filed an application for this lot in the Board of
Liquidators (Board for short) in 1975. On June 15, 1976, Resolution No. 606, Series of 1976
was passed by the Board disposing of the lot in favor of petitioner by way of a negotiated
sale in conformity with the decision in Civil Case No. 950. Private respondent protested
against the application of petitioner and on August 8, 1978, the Board adopted Resolution
No. 611, Series of 1978 denying private respondent’s protest for the same reason. A
request for reconsideration of private respondent was referred by the Board to Mr.
Artemio Garlit, liquidator-designee, General Santos Branch, for verification and
investigation. After hearings, Mr. Garlit submitted a report to the Manila office
recommending division of the lot to the parties. Nevertheless, on March 13, 1981, the
Board denied the protest because the case had already been decided by the court.
However, a motion for reconsideration filed by private respondent was favorably
considered by the Board in Resolution No. 233, Series of 1981 dated July 8, 1981. Thus,
the Board directed the chief of LASEDECO to investigate the occupancy and area of the lot.
In this investigation, it was found that only private respondent was the actual occupant so
KPL
the LASEDECO chief recommended the division of the property between petitioner and
private respondent.
On August 14, 1981, the Board passed Resolution No. 272, Series of 1981 approving said
recommendation by dividing the lot equally between the parties at 135.5 square meters
each to be disposed to them by negotiated sale.
Both parties appealed to the Office of the President but in a decision dated March 25,
1984, both appeals were dismissed. A motion for reconsideration filed by petitioner was
denied on May 29, 1984.
Private respondent paid for the value of 1/2 of the lot and applied for the issuance of a
patent. In Resolution No. 185, Series of 1985 adopted on October 7, 1985, the Board gave
due course to the application of private respondent and for the issuance of a patent to 1/2
portion of the lot. Petitioner was also advised to file his application and pay for his
portion. Thus, Miscellaneous Sales Patent No. 4261 and Original Certificate of Title No. P-
5139 were issued to private respondent.
On November 27, 1985, petitioner filed an action for “Annulment and Cancellation of
Partition of Lot 5989, Ts-217, situated at Dadiangas, General Santos City and Annulment of
Resolutions No. 272 and 185 and/or to Declare them Null and Void” against private
respondent and the Board. The suit was docketed as Civil Case No. 3270 in the Regional
Trial Court of General Santos City.
On February 11, 1985, private respondent filed a motion to dismiss the complaint on the
following grounds: (1) lack of jurisdiction over the subject matter; (2) petitioner has no
capacity to sue; (3) petitioner is not a real party-in-interest; and (4) the action is barred by
prior judgment. Private respondent added another ground (5) lack of conciliation efforts
pursuant to Section 6 of Presidential Decree No. 1508. The motion was granted in an
order dated March 18, 1986.
On April 3, 1986, petitioner moved for a reconsideration thereof to which an opposition
was filed by private respondent. The motion for reconsideration was granted in an order
of April 21, 1986 and private respondent was required to file his responsive pleading.
Private respondent filed his answer. On July 10, 1986, private respondent asked for a
preliminary hearing of the grounds for the motion to dismiss in his affirmative defenses.
This was denied on July 24, 1986.
Hence, private respondent filed a petition for certiorari and prohibition in the Court of
Appeals questioning the said orders of the trial court dated April 21, 1986 and July 24,
1986. In due course, a decision was rendered by the appellate court on March 16, 1988
26
De Joya Civil Procedure
granting the petition, declaring the questioned orders null and void, and directing the trial
court to dismiss the civil case for lack of jurisdiction, without pronouncement as to costs.
An urgent motion for reconsideration filed by petitioner was denied in a resolution dated
May 31, 1988.1
Thus, the herein petition wherein petitioner raises the following issues—
“FIRST ASSIGNMENT OF ERROR
THE RESPONDENT COURT ERRED IN DECIDING CA-G.R. SP NO. 12183 WITHOUT FIRST
SERVING SUMMONS AND A COPY OF THE PETITION TO THE PRIVATE RESPONDENT IN THE
SAID CASE (NOW PETITIONER IN THE INSTANT CASE), THUS, DEPRIVING HIM OF HIS
CONSTITUTIONAL RIGHT TO DUE PROCESS OF LAW.
SECOND ASSIGNMENT OF ERROR
THE RESPONDENT COURT ERRED IN GIVING DUE COURSE TO THE PETITION OF ARMIE
ELMA IN CA-G.R. SP NO. 12183 IN SPITE OF THE FACT THAT THE TWO (2) ORDERS SUBJECT
MATTER OF THE PETITION ARE INTERLOCUTORY IN NATURE.
THIRD ASSIGNMENT OF ERROR
THE RESPONDENT COURT ERRED IN HOLDING THAT THE TRIAL COURT HAS NO
JURISDICTION OVER CIVIL CASE NO. 3270.
FOURTH ASSIGNMENT OF ERROR
THE RESPONDENT COURT ERRED IN HOLDING THAT THE TRIAL COURT SHOULD HAVE
DISMISSED CIVIL CASE NO. 3270 FOR FAILURE OF THE PLAINTIFF TO COMPLY WITH THE
PROVISIONS OF P.D. NO. 1508 BEFORE FILING HIS COMPLAINT IN COURT.”2
The petition is devoid of any merit.
Under the first assigned error, petitioner alleges that he was not served summons and a
copy of the petition so that he was deprived of due process and the respondent court did
not acquire jurisdiction over his person.
Private respondent disputes this claim by showing that it was at the address of petitioner
appearing in the petition at Liwayway Disco Restaurant and Disco Pub, Ilang-Ilang Street,
General Santos City, where petitioner was served a copy of private respondent’s
KPL
“Manifestation and Motion for Early Resolution.”3 Petitioner’s counsel was also served a
copy of the resolution dated June 28, 1987,4 “Motion for Restraining Order” dated July 28,
1987 and Manifestation dated December 1, 1987.5 Indeed, petitioner’s counsel filed a
motion dated April 4, 1988 seeking a reconsideration of the decision of respondent court6
which was denied on May 31, 1988. Obviously, petitioner voluntarily submitted to the
jurisdiction of the respondent court and was never deprived of due process.7
Under the second and third assigned errors, petitioner contends that the appellate court
erred in giving due course to the petition that assailed the two orders of the court a quo
which are interlocutory in character and in holding that the trial court has no jurisdiction
over Civil Case No. 3270.
It is precisely to correct the lower court when in the course of proceedings it acts without
jurisdiction or in excess thereof or if the trial court judge otherwise acted with grave
abuse of discretion that the extraordinary writ of certiorari or prohibition is afforded to
parties as a relief. Such writ is available even in respect to interlocutory orders.8
The appellate court correctly ruled that courts of justice will not interfere with purely
administrative matters rendered by administrative bodies or officials acting within the
scope of their power and authority. The discretionary power vested in the proper
executive official, in the absence of arbitrariness or grave abuse so as to go beyond the
statutory authority, is not subject to the contrary judgment or control of the courts and is
treated with finality.9
When Board Resolution No. 272 was passed in 1981, petitioner appealed to the Office of
the President. After his appeal was denied on March 26, 1984, he did not file a petition for
review in this court. Thus, the said decision became final and it was duly implemented. We
agree that when petitioner filed Civil Case No. 3270, the trial court should have refrained
from interfering with said administrative disposition of the chief executive absent any
showing of lack or excess of jurisdiction or grave abuse of discretion.
True it is that the Board is a government instrumentality but the petitioner and private
respondent who are also contending parties in the case are residents of the same
barangay so Section 6 of Presidential Decree No. 1508 should apply to them as it provides
—
“Section 6. Conciliation, pre-condition to filing of complaint.No complaint, petition, action
or proceeding involving any matter within the authority of the Luponas provided in
Section 2 hereof shall be filed or instituted in court or any other government office for
adjudication unless there has been a confrontation of the parties before the Lupon
Chairman or the Pangkat and no conciliation or settlement has been reached as certified
by the Lupon Secretary or the Pangkat Secretary attested by the
LuponorPangkatChairman, or unless the settlement has been repudiated.”
The purpose of this confrontation is to enable the parties to settle their differences
amicably. If the other only contending party is the government or its instrumentality or
subdivision the case falls within the exception but when it is only one of the contending
parties, a confrontation should still be undertaken among the other parties.
WHEREFORE, the petition is DISMISSED. No costs. SO ORDERED.
Petition dismissed.
Notes.—Grave abuse of discretion as basis for the issuance of the writ of certiorari is a
well-defined concept. (Imutan vs. CA, 102 SCRA 286.)
Certiorari, even in instances of lack of jurisdiction or grave abuse of discretion, cannot as a
rule be a substitute for appeal. (People vs. Villanueva, 110 SCRA 465.) Gegare vs. Court of
Appeals, 177 SCRA 471, G.R. No. 83907 September 13, 1989

Moreover, petitioner had no capacity to file the questioned suit in the lower court. The
real party-in-interest who can seek the nullification of the land grant is the government or
the state.10

Under the fourth and last assigned error, petitioner argues that it was erroneous for the
appellate court to hold that the case should be dismissed by the lower court for failure to
comply with a provision of Presidential Decree No. 1508 before filing the complaint. He
alleges that this rule is not applicable in said case for one of the parties therein is the
government or any subdivision or instrumentality thereof which is excepted from this
requirement under Section 2 of said law.

27
De Joya Civil Procedure KPL
G.R. No. 137359. September 13, 2004.*
EDWIN N. TRIBIANA, petitioner, vs. LOURDES M. TRIBIANA, respondent.
Remedial Law; Dismissal of Actions; A dismissal under Section 1(j) of Rule 16 is warranted
only if there is a failure to comply with a condition precedent. Given that the alleged
defect is a mere failure to allege compliance with a condition precedent, the proper
solution is not an outright dismissal of the action, but an amendment under Section 1 of
Rule 10 of the 1997 Rules of Civil Procedure.—A dismissal under Section 1(j) of Rule 16 is
warranted only if there is a failure to comply with a condition precedent. Given that the
alleged defect is a mere failure to allege compliance with a condition precedent, the
proper solution is not an outright dismissal of the action, but an amendment under
Section 1 of Rule 10 of the 1997 Rules of Civil Procedure. It would have been a different
matter if Edwin had asserted that no efforts to arrive at a compromise have been made at
all.
Same; Habeas Corpus; In a habeas corpus proceeding involving the welfare and custody of
a child of tender age, the paramount concern is to resolve immediately the issue of who
has the legal custody of the child. Technicalities should not stand in the way of giving such
child of tender age full protection.—In a habeas corpus proceeding involving the welfare
and custody of a child of tender age, the paramount concern is to resolve immediately the
issue of who has legal custody of the child. Technicalities should not stand in the way of
giving such child of tender age full protection. This rule has sound statutory basis in Article
213 of the Family Code, which states, “No child under seven years of age shall be
separated from the mother unless the court finds compelling reasons to order otherwise.”
PETITION for review on certiorari of the resolutions of the Court of Appeals.
The facts are stated in the opinion of the Court.
     Agripino C. Baybay III for petitioner.
     Bridie O. Castronuevo for respondent.
CARPIO, J.:
The Case
This petition for review on certiorari1 seeks to reverse the Court of Appeals’ Resolutions2
dated 2 July 1998 and 18 January 1999 in CA-G.R. SP No. 48049. The Court of Appeals
affirmed the Order3 of the Regional Trial Court, Branch 19, Bacoor, Cavite (“RTC”),
denying petitioner Edwin N. Tribiana’s (“Edwin”) motion to dismiss the petition for habeas
corpus filed against him by respondent Lourdes Tribiana (“Lourdes”).
Antecedent Facts
28
De Joya Civil Procedure
Edwin and Lourdes are husband and wife who have lived together since 1996 but
formalized their union only on 28 October 1997. On 30 April 1998, Lourdes filed a petition
for habeas corpus before the RTC claiming that Edwin left their conjugal home with their
daughter, Khriza Mae Tribiana (“Khriza”). Edwin has since deprived Lourdes of lawful
custody of Khriza who was then only one (1) year and four (4) months of age. Later, it
turned out that Khriza was being held by Edwin’s mother, Rosalina Tribiana (“Rosalina”).
Edwin moved to dismiss Lourdes’ petition on the ground that the petition failed to allege
that earnest efforts at a compromise were made before its filing as required by Article 151
of the Family Code.
_______________
1 Under Rule 45 of the 1997 Rules of Civil Procedure.
On 20 May 1998, Lourdes filed her opposition to Edwin’s motion to dismiss claiming that
there were prior efforts at a compromise, which failed. Lourdes attached to her opposition
a copy of the Certification to File Action from their Barangay dated 1 May 1998.
On 18 May 1998, the RTC denied Edwin’s motion to dismiss and reiterated a previous
order requiring Edwin and his mother, Rosalina to bring Khriza before the RTC. Upon
denial of his motion for reconsideration, Edwin filed with the Court of Appeals a petition
for prohibition and certiorari under Rule 65 of the Rules of Civil Procedure. The appellate
court denied Edwin’s petition on 2 July 1998. The appellate court also denied Edwin’s
motion for reconsideration.
Hence, this petition.
The Rulings of the RTC and the Court of Appeals
The RTC denied Edwin’s motion to dismiss on the ground that the Certification to File
Action attached by Lourdes to her opposition clearly indicates that the parties attempted
to reach a compromise but failed.
The Court of Appeals upheld the ruling of the RTC and added that under Section 412 (b)
(2) of the Local Government Code, conciliation proceedings before the barangay are not
required in petitions for habeas corpus.
The Issue
Edwin seeks a reversal and raises the following issue for resolution:
KPL
WHETHER THE TRIAL AND APPELLATE COURTS SHOULD HAVE DISMISSED THE PETITION
FOR HABEAS CORPUS ON THE GROUND OF FAILURE TO COMPLY WITH THE CONDITION
PRECEDENT UNDER ARTICLE 151 OF THE FAMILY CODE.
The Ruling of the Court
The petition lacks merit.
Edwin argues that Lourdes’ failure to indicate in her petition for habeas corpus that the
parties exerted prior efforts to reach a compromise and that such efforts failed is a ground
for the petition’s dismissal under Section 1(j), Rule 16 of the 1997 Rules of Civil
Procedure.4 Edwin maintains that under Article 151 of the Family Code, an earnest effort
to reach a compromise is an indispensable condition precedent. Article 151 provides:
No suit between members of the same family shall prosper unless it should appear from
the verified complaint or petition that earnest efforts toward a compromise have been
made, but that the same have failed. If it is shown that no such efforts were in fact made,
the case must be dismissed.
This rule shall not apply to cases which may not be the subject of compromise under the
Civil Code.
Edwin’s arguments do not persuade us.
It is true that the petition for habeas corpus filed by Lourdes failed to allege that she
resorted to compromise proceedings before filing the petition. However, in her opposition
to Edwin’s motion to dismiss, Lourdes attached a Barangay Certification to File Action
dated 1 May 1998. Edwin does not dispute the authenticity of the Barangay Certification
and its contents. This effectively established that the parties tried to compromise but
were unsuccessful in their efforts. However,
_______________
4 Section 1(j) of Rule 16 of the Rules of Court states:
SECTION 1. Grounds.—Within the time for but before filing the answer to the complaint or
pleading asserting a claim, a motion to dismiss may be made on any of the following
grounds:
xxx
(j) That a condition precedent for filing the claim has not been complied with.
29
De Joya Civil Procedure
Edwin would have the petition dismissed despite the existence of the Barangay
Certification, which he does not even dispute.
Evidently, Lourdes has complied with the condition precedent under Article 151 of the
Family Code. A dismissal under Section 1(j) of Rule 16 is warranted only if there is a failure
to comply with a condition precedent. Given that the alleged defect is a mere failure to
allege compliance with a condition precedent, the proper solution is not an outright
dismissal of the action, but an amendment under Section 1 of Rule 10 of the 1997 Rules of
Civil Procedure.5 It would have been a different matter if Edwin had asserted that no
efforts to arrive at a compromise have been made at all.
In addition, the failure of a party to comply with a condition precedent is not a
jurisdictional defect.6 Such defect does not place the controversy beyond the court’s
power to resolve. If a party fails to raise such defect in a motion to dismiss, such defect is
deemed waived.7 Such defect is curable by amendment as a matter of right without leave
of court, if made before the filing of a responsive pleading.8 A motion to dismiss is not a
responsive pleading.9 More importantly, an amendment alleging compliance with a
condition precedent is not a jurisdictional matter. Neither does it alter the cause of
_______________
5 Section 1 of Rule 10 of the 1997 Rules of Civil Procedure states:
SECTION 1. Amendments in general.—Pleadings may be amended by adding or striking out
an allegation or the name of any party, or by correcting a mistake in the name of a party
or a mistaken or inadequate allegation or description in any other respect, so that the
actual merits of the controversy may speedily be determined, without regard to
technicalities, and in the most expeditious and inexpensive manner.
action of a petition for habeas corpus. We have held that in cases where the defect
consists of the failure to state compliance with a condition precedent, the trial court
should order the amendment of the complaint.10 Courts should be liberal in allowing
amendments to pleadings to avoid multiplicity of suits and to present the real
controversies between the parties.11
Moreover, in a habeas corpus proceeding involving the welfare and custody of a child of
tender age, the paramount concern is to resolve immediately the issue of who has legal
custody of the child. Technicalities should not stand in the way of giving such child of
tender age full protection.12 This rule has sound statutory basis in Article 213 of the
Family Code, which states, “No child under seven years of age shall be separated from the
mother unless the court finds compelling reasons to order otherwise.” In this case, the
child (Khriza) was only one year and four months when taken away from the mother.
KPL

The Court of Appeals dismissed Edwin’s contentions by citing as an additional ground the
exception in Section 412 (b) (2) of the Local Government Code (“LGC”) on barangay
conciliation, which states:
(b) Where the parties may go directly to court.—the parties may go directly to court in the
following instances:
xxx
2) Where a person has otherwise been deprived of personal liberty calling for habeas
corpus proceedings;
x x x.
Under Rule 102 of the 1997 Rules of Civil Procedure, a party may resort to a habeas
corpus proceeding in two instances. The first is when any person is deprived of liberty
either through illegal confinement or through detention. The second instance is when
custody of any person is withheld from the person entitled to such custody. The most
common case falling under the second instance involves children who are taken away
from a parent by another parent or by a relative. The case filed by Lourdes falls under this
category.
of the slightest abuse of discretion by the RTC or the Court of Appeals. A party must not
be allowed to delay litigation by the sheer expediency of filing a petition for certiorari
under Rule 65 based on scant allegations of grave abuse. More importantly, any matter
involving the custody of a child of tender age deserves immediate resolution to protect
the child’s welfare.
WHEREFORE, we DISMISS the instant petition for lack of merit. We AFFIRM the
Resolutions of the Court of Appeals dated 2 July 1998 and 18 January 1999 in CA-G.R. SP
No. 48049. The Regional Trial Court, Branch 19, Bacoor, Cavite is ordered to act with
dispatch in resolving the petition for habeas corpus pending before it. This decision is
IMMEDIATELY EXECUTORY.
SO ORDERED.
Petition dismissed, assailed resolutions affirmed.
Note.—The writ of habeas corpus extends to all cases of illegal confinement or detention
by which any person is deprived of his liberty. (Cruz vs. Court of Appeals, 322 SCRA 518
[2000])

The barangay conciliation requirement in Section 412 of the LGC does not apply to habeas
corpus proceedings where a person is “deprived of personal liberty.” In such a case,
Section 412 expressly authorizes the parties “to go directly to court” without need of any
conciliation proceedings. There is deprivation of personal liberty warranting a petition for
habeas corpus where the “rightful custody of any person is withheld from the person
entitled thereto.”13 Thus, the Court of Appeals did not err when it dismissed Edwin’s
contentions on the additional ground that Section 412 exempts petitions for habeas
corpus from the barangay conciliation requirement.

The petition for certiorari filed by Edwin questioning the RTC’s denial of his motion to
dismiss merely states a blanket allegation of “grave abuse of discretion.” An order denying
a motion to dismiss is interlocutory and is not a proper subject of a petition for
certiorari.14 Even in the face of an error of judgment on the part of a judge denying the
motion to dismiss, certiorari will not lie. Certiorari is not a remedy to correct errors of
procedure.15 The proper remedy against an order denying a motion to dismiss is to file an
answer and interpose as affirmative defenses the objections raised in the motion to
dismiss. It is only in the presence of extraordinary circumstances evincing a patent
disregard of justice and fair play where resort to a petition for certiorari is proper.16

The litigation of substantive issues must not rest on a prolonged contest on technicalities.
This is precisely what has happened in this case. The circumstances are devoid of any hint

30
De Joya Civil Procedure KPL
G.R. No. 160032. November 11, 2005.*
ESTELA L. BERBA, petitioner, vs. JOSEPHINE PABLO and THE HEIRS OF CARLOS PALANCA,
respondents.
Actions; Katarungang Pambarangay; Settlement Agreements; The Settlement Agreement
of parties approved by the Lupon ng Tagapamayapa may be enforced by the Lupon,
through the punong barangay within six months, and if the settlement is not enforced
after the lapse of said period, it may be enforced by an action in the proper city or
municipal court.—The records show that petitioner and respondent Josephine Pablo
executed an Agreement on June 5, 1999, which was approved by the Lupon. Respondent
Josephine Pablo did not repudiate the agreement; hence, such agreement of the parties
settling the case had the force and effect of a final judgment. As the Court declared in
Vidal v. Escueta, the settlement of the parties may be enforced by the Lupon, through the
punong barangay, within six months; and if the settlement is not enforced after the lapse
of said period, it may be enforced by an action in the proper city or municipal court, as
provided in Section 417 of the Local Government Code.
Same; Same; Administrative Law; Doctrine of Exhaustion of Administrative Remedies;
Under Section 408 of the Local Government Code, parties actually residing in the same
city or municipality are bound to submit their disputes to the Lupon for
conciliation/amicable settlement, unless otherwise provided therein; If the
complainant/plaintiff fails to comply with the requirements of the Code, such complaint
filed with the court may be dismissed for failure to exhaust all administrative remedies.—
Under Sec. 408 of the same Code, parties actually residing in the same city or municipality
are bound to submit their disputes to the Lupon for conciliation/amicable settlement,
unless otherwise provided therein: SEC. 408. Subject Matter for Amicable Settlement;
Exception Thereto.—The lupon of each barangay shall have authority to bring together
the parties actually residing in the same city or municipality for amicable settlement of all
disputes except: (a) Where one party is the government or any subdivision or
instrumentality thereof; (b) Where one party is a public officer or employee, and the
dispute relates to the performance of his official functions; (c) Offenses punishable by
imprisonment exceeding one (1) year or a fine exceeding Five Thousand pesos
(P5,000.00); (d) Offenses where there is no private offended party; (e) Where the dispute
involves real properties located in different cities or municipalities unless the parties
thereto agree to submit their differences to amicable settlement by an appropriate lupon;
(f) Disputes involving parties who actually reside in barangays of different cities or
municipalities, except where such barangay units adjoin each other and the parties
thereto agree to submit their differences to amicable settlement by an appropriate lupon;
(g) Such other classes of disputes which the President may determine in the interest of
justice or upon the recommendation of the Secretary of Justice. The court in which non-
criminal cases not falling within the authority of the lupon under this Code are filed may,
31
De Joya Civil Procedure
at any time before trial, motu proprio refer the case to the lupon concerned for amicable
settlement. If the complainant/plaintiff fails to comply with the requirements of the Local
Government Code, such complaint filed with the court may be dismissed for failure to
exhaust all administrative remedies.
PETITION for review on certiorari of a decision of the Court of Appeals.
The facts are stated in the opinion of the Court.
     Garcia, Ines, Villacarlos and Garcia Law Offices for petitioner.
     Patricio Balao for respondents.
CALLEJO, SR., J.:
Assailed before the Court on a petition for review on certiorari is the Decision1 of the
Court of Appeals (CA) in CA-G.R. SP No. 73531, affirming the Decision2 of the Regional
Trial Court (RTC) of Manila in Civil Case No. 170639.
Estela L. Berba, a resident of 978 Maligaya Street, Malate, Manila, was the owner of a
parcel of land located at No. 2338 M. Roxas Street, Sta. Ana, Manila covered by Transfer
Certificate of Title (TCT) No. 63726. A house was constructed on the lot, which she leased
to Josephine Pablo** and the Heirs of Carlos Palanca sometime in 1976. The lease was
covered by a lease contract. Upon its expiration, the lessees continued leasing the house
on a month-to-month basis.
By 1999, the monthly rental on the property was P3,450.00. The lessees failed to pay the
rentals due, and by May 1999, their arrears amounted to P81,818.00. Berba then filed a
complaint for eviction and collection of unpaid rentals only against Pablo in the Office of
the Punong Barangay. On June 5, 1999, Berba and Pablo executed an Agreement
approved by the pangkat, as follows:
Ako si Josephine Pablo, naninirahan sa 2338 M. Roxas St., Sta. Ana, Manila, na nasasakop
ng Barangay 873, Zone 96, ay nangangako kay GG Robert Berba na nagmamay-ari ng aking
tinitirahan ay maghuhulog ng halagang Tatlong Libong Piso P3,000.00 kada ika-sampu ng
buwan bilang hulog sa aking pagkakautang kay GG Berba na umaabot sa halagang
P81,818.00 na ang nasabing halagang ito ay aking huhulugan hanggang aking mabayaran
ng buo ang aking pagkakautang. Ako rin, si Josephine Pablo, ay nangangako na ang hindi
ko pagsunod o pagbayad ng buwanang hulog, ako ay kusang aalis sa aking tinitirahan.
Bukod pa sa hulog sa aking pagkakautang, ako rin ay magbabayad ng halagang P3,450.00
bilang aking upa sa aking tinitirahan.3
KPL

By May 2000, Pablo and the lessees still had a balance of P71,716.00. As of May 1, 2001,
the total arrearages of the lessees amounted to P135,115.63.4 On May 2, 2001, Berba,
through counsel, wrote the lessees, demanding payment of the said amount and to vacate
the house within 30 days from notice, otherwise she will sue them.5 The lessees ignored
the demand. On June 21, 2001, Berba filed a complaint6 against Josephine Pablo and the
Heirs of Carlos Palanca in the Metropolitan Trial Court (MTC) of Manila for unlawful
detainer. She prayed that, after due proceedings, judgment be rendered in her favor:
“WHEREFORE, it is most respectfully prayed for that judgment be rendered in favor of
plaintiff ordering defendant (sic)—
a)to vacate the premises situated at 2338 M. Roxas Street, Sta. Ana, City of Manila;
b)to pay plaintiff the sum of One Hundred Thirty-Five Thousand One Hundred Fifteen and
63/100 Pesos (P135,115.63) representing monthly rentals in arrears to the present;
c)to pay plaintiff the amount of Four Thousand Five Hundred Sixty-Two and 63/100 Pesos
(P4,562.63) per month representing monthly rent on the premises for the year 2001 until
finality of the judgment;
d)to pay plaintiff the sum of Twenty Thousand Pesos (P20,000.00) by way of attorney’s
fees;
e)to reimburse plaintiff all expenses for litigation estimated in the amount of Ten
Thousand Pesos;
f)to pay costs of suit.
Other reliefs just and equitable are, likewise, prayed for under the premises.”7
Berba, however, failed to append to her complaint a certification from the Lupon ng
Tagapamayapa that no conciliation or settlement had been reached.
In their answer to the complaint, the defendants admitted to have stopped paying rentals
because of financial distress. They also alleged that they were not certain if the plaintiff
was the owner of the property. By way of special and affirmative defenses, they averred
that the plaintiff had no cause of action against them as she failed to secure a Certificate
to File Action from the Lupon.8
During the pre-trial conference, the parties manifested to the court that, despite earnest
efforts, no amicable settlement was reached. They defined the main issue as whether or
not the plaintiff had a valid cause of action for unlawful detainer against the defendants.9
In her position paper, Berba appended an Agreement dated June 5, 1999 between her and
Pablo, which appeared to have been approved by Punong Barangay Cayetano L. Gonzales
of Barangay 873, as well as other members of the Lupon,10 duly approved by the Pangkat.
32
De Joya Civil Procedure
She also appended a Statement of Account indicating that the defendants’ back rentals
amounted to P135,115.63.11
In their position paper, the defendants insisted that the dispute did not go through the
Lupon ng Tagapamayapa prior to the filing of the complaint; hence, Berba’s complaint was
premature. They also averred that the increase in the rental rates imposed by the plaintiff
was unjustified and illegal.
In her reply, the plaintiff alleged that there was no more need for her to secure a
Certificate to File Action because she was a resident of No. 978 Maligaya Street, Malate,
Manila, while the defendants were residing in Barangay 873, Zone 6 in Sta. Ana, Manila.
On March 14, 2002, the MTC rendered judgment in favor of Berba. The fallo of the
decision reads:
“WHEREFORE, judgment is rendered in favor of the plaintiff and ordering the defendants
and all persons claiming rights under them to vacate the premises at 2338 M. Roxas St.,
Sta. Ana, Manila and restore possession thereof to the plaintiff. Ordering the defendant to
pay the amount of P135,115.63 representing monthly rentals since 1999 until December
2000. Ordering the defendant to pay the plaintiff the sum of P4,562.63 per month
beginning January 2001 and for the succeeding months until finally vacated. Ordering the
defendant to pay the reduced amount of P10,000.00 as attorney’s fees plus the costs of
suit. SO ORDERED.”12
The defendants appealed the decision to the RTC. On motion of the plaintiff, the RTC
issued an order for the execution of the decision pending appeal.13 The defendants filed a
motion for the recall of the Order,14 but before the court could resolve the motion, the
Sheriff turned over the physical possession of the property to Berba on May 20, 2002.15
In their Appeal Memorandum, Pablo and the heirs of Palanca insisted that Berba’s action
in the MTC was premature because of the absence of Certificate to File Action issued by
the Lupon. They also claimed that Berba unlawfully increased the rentals for the house.16
Berba, on the other hand, averred that there was no need of a prior referral to the Lupon
before filing her complaint. The petitioner cited Section 408(f) of the Local Government
Code, pointing out that she resided in a Barangay in Malate, 8 kilometers away from
Barangay 873 in Sta. Ana, where Pablo and the Palanca heirs resided.17
On August 20, 2002, the RTC rendered judgment granting the appeal and setting aside the
appealed decision. The fallo of the decision reads:
KPL
“WHEREFORE, the decision of the Court a quo is ordered set aside. The complaint is also
ordered DISMISSED WITHOUT PREJUDICE. The Writ of Execution issued by the Court a quo
pending appeal is also set aside. SO ORDERED.”18
The RTC ruled that under Section 408 of the Local Government Code, parties who reside in
the same city or municipality although in different barangays are mandated to go through
conciliation proceedings in the Lupon.19 The court cited the rulings of this Court in
Morata v. Go,20 and Vda. de Borromeo v. Pogoy.21
Berba filed a motion for the reconsideration22 of the decision, which the RTC denied in its
Order23 dated October 2, 2002. She then elevated the case to the CA via petition for
review, where she averred:
a)The raising of other affirmative defenses apart from the non-referral to the Barangay
Court by the respondents constitute a waiver of such requirement; and
b)There was substantial compliance on the part of the petitioner with respect to referring
her complaint before the Barangay Court.24
Citing the ruling of this Court in Diu v. Court of Appeals,25 Berba claimed that Section 408
of the Local Government Code should be construed liberally together with Section 412.
She further averred that she had complied substantially with the requisites of the law, and
recalls that conciliation proceedings before the Lupon resulted in the execution of an
Agreement on June 5, 1999. Upon failure to comply with the agreement, all chances of
amicable settlement were effectively foreclosed. Hence, Pablo and the Heirs of Palanca
were estopped from claiming that she failed to comply with the Local Government Code’s
requirement of prior referral of their dispute to the Lupon.
After due proceedings, the CA rendered judgment dismissing the petition and affirming
the RTC decision. Berba moved for a reconsideration of the decision, which proved futile.
In the instant petition for review on certiorari, the petitioner alleges that:
THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED WHEN IT FAILED TO CONSIDER
THE DECISION OF THIS HONORABLE COURT IN THE CASE OF DIU VS. COURT OF APPEALS
(251 SCRA 478) AND IN DECLARING THAT THERE WAS NO SUBSTANTIAL COMPLIANCE
WITH THE MANDATE OF PD 1508 (NOW R.A. 7160) WITH RESPECT TO PRIOR REFERRAL TO
THE BARANGAY COURT, THEREBY DECIDING THE CASE NOT IN ACCORD WITH LAW AND
APPLICABLE DECISIONS OF THE COURT.26
The petitioner avers that she is a sickly widow, in the twilight of her years, and whose only
source of income are the rentals generated from the property, which she also uses to pay
33
De Joya Civil Procedure
her medical expenses. She avers that the continued denial of her right to the fruits of the
subject property is highly unjust and contrary to the spirit behind the enactment of
Presidential Decree (P.D.) No. 1508.27
The petitioner also points out that, for her to pay obeisance to the decision of the CA, she
would have to go through the tedious, not to mention horrendous, process of going back
to square one; that is, referring the dispute to the barangay which, in all likelihood, would
be rendered useless considering that respondents had already been validly and effectively
ejected from the leased premises. She would then have to go through the rungs of the
judicial ladder a second time to vindicate her trampled rights. She further claims that the
CA’s affirmation of the RTC decision is equivalent to sanctioning a “legal anomaly.” She
points out that the very purpose of barangay conciliation is to abbreviate disputes
between members of the same or adjacent barangays to the end that their disputes will
not reach the doors of the courts. Clearly, it does not contemplate a protracted process as
suggested by the RTC ruling and affirmed by the CA.28
In their comment on the petition, the respondents aver that the petitioner was estopped
from relying on the June 5, 1999 Agreement between her and respondent Josephine Pablo
before the Lupon because the respondent Heirs of Carlos Palanca were not parties
thereto. The respondents maintained that the petitioner must bear the blame for her
failure to comply with the Local Government Code. At first, she insisted that there was no
need for prior referral of the dispute to the Lupon, claiming that she resided in a barangay
other than where the respondents resided. Thereafter, she made a volte face and invoked
the June 5, 1999 Agreement between her and respondent Josephine Pablo. Moreover, the
respondents aver, the MTC had no jurisdiction over the petitioner’s action for unlawful
detainer because it was filed only on June 21, 2001, or more than one year from June 5,
1999 when the petitioner and respondent Josephine Pablo executed the agreement. As
such, the action should be one for recovery of possession of property (accion publiciana).
On June 2, 2004, the Court resolved to give due course to the petition and required the
parties to file their respective memoranda.29 The parties complied.
The Court rules that the CA cannot be faulted for affirming the decision of the RTC
reversing the decision of the MTC and ordering the dismissal of the complaint for unlawful
detainer without prejudice.
The records show that petitioner and respondent Josephine Pablo executed an Agreement
on June 5, 1999, which was approved by the Lupon. Respondent Josephine Pablo did not
repudiate the agreement; hence, such agreement of the parties settling the case had the
force and effect of a final judgment. As the Court declared in Vidal v. Escueta,30 the
settlement of the parties may be enforced by the Lupon, through the punong barangay,
KPL
within six months; and if the settlement is not enforced after the lapse of said period, it
may be enforced by an action in the proper city or municipal court, as provided in Section
417 of the Local Government Code:
“We also agree that the Secretary of the Lupon is mandated to transmit the settlement to
the appropriate city or municipal court within the time frame under Section 418 of the
LGC and to furnish the parties and the Lupon Chairman with copies thereof. The amicable
settlement which is not repudiated within the period therefor may be enforced by
execution by the Lupon through the Punong Barangay within a time line of six months,
and if the settlement is not so enforced by the Lupon after the lapse of said period, it may
be enforced only by an action in the proper city or municipal court as provided for in
Section 417 of the LGC of 1991, as amended, which reads:
SEC. 417. Execution.—The amicable settlement or arbitration award may be enforced by
execution by the Lupon within six (6) months from the date of the settlement. After the
lapse of such time, the settlement may be enforced by action in the proper city or
municipal court. (Italics supplied).
Section 417 of the Local Government Code provides a mechanism for the enforcement of
a settlement of the parties before the Lupon. It provides for a two-tiered mode of
enforcement of an amicable settlement executed by the parties before the Lupon,
namely, (a) by execution of the Punong Barangay which is quasi-judicial and summary in
nature on mere motion of the party/parties entitled thereto; and (b) by an action in
regular form, which remedy is judicial. Under the first remedy, the proceedings are
covered by the LGC and the Katarungang Pambarangay Implementing Rules and
Regulations. The Punong Barangay is called upon during the hearing to determine solely
the fact of non-compliance of the terms of the settlement and to give the defaulting party
another chance at voluntarily complying with his obligation under the settlement. Under
the second remedy, the proceedings are governed by the Rules of Court, as amended. The
cause of action is the amicable settlement itself, which, by operation of law, has the force
and effect of a final judgment.
Section 417 of the LGC grants a period of six months to enforce the amicable settlement
by the Lupon through the Punong Barangay before such party may resort to filing an
action with the MTC to enforce the settlement. The raison d’etre of the law is to afford the
parties during the six-month time line, a simple, speedy and less expensive enforcement
of their settlement before the Lupon.”31
In the present case, respondent Josephine Pablo failed to comply with her obligation of
repaying the back rentals of P81,818.00 and the current rentals for the house. Hence, the
petitioner had the right to enforce the Agreement against her and move for her eviction
34
De Joya Civil Procedure
from the premises. However, instead of filing a motion before the Lupon for the
enforcement of the agreement, or (after six months), an action in the Metropolitan Trial
Court (MTC) for the enforcement of the settlement, the petitioner filed an action against
respondent Josephine Pablo for unlawful detainer and the collection of unpaid rentals,
inclusive of those already due before the June 5, 1999 Agreement was executed. The
action of the petitioner against respondent Pablo was barred by the Agreement of June 5,
1999.
The Court notes that the petitioner even submitted with the MTC a copy of her June 5,
1999 Agreement with respondent Josephine Pablo. Instead of dismissing the complaint as
against such respondent, the MTC rendered judgment against her and ordered her
eviction from the leased premises.
The Court thus rules that the petitioner’s complaint against respondent Heirs of Carlos
Palanca was premature. It bears stressing that they were not impleaded by the petitioner
as parties-respondents before the Lupon. The petitioner filed her complaint solely against
respondent Josephine Pablo. Moreover, the said respondent heirs were not privy to the
said agreement, and, as such, were not bound by it. Section 412 of the Local Government
Code, sets forth the precondition to filing of complaints in court, to wit:
SEC. 412. Conciliation.—(a) Pre-condition to filing of complaint in court.—No complaint,
petition, action, or proceeding involving any matter within the authority of the lupon shall
be filed or instituted directly in court or any other government office for adjudication,
unless there has been a confrontation between the parties before the lupon chairman or
the pangkat, and that no conciliation or settlement has been reached as certified by the
lupon secretary or pangkat secretary as attested to by the lupon chairman or pangkat
chairman or unless the settlement has been repudiated by the parties thereto.
(b)Where parties may go directly to court.—The parties may go directly to court in the
following instances:
(1)Where the accused is under detention;
(2)Where a person has otherwise been deprived of personal liberty calling for habeas
corpus proceedings;
(3)Where actions are coupled with provisional remedies such as preliminary injunction,
attachment, delivery of personal property, and support pendente lite; and
(4)Where the action may otherwise be barred by the statute of limitations.
(c)Conciliation among members of indigenous cultural communities.—The customs and
traditions of indigenous cultural communities shall be applied in settling disputes between
members of the cultural communities.
KPL
Under Sec. 408 of the same Code, parties actually residing in the same city or municipality
are bound to submit their disputes to the Lupon for conciliation/amicable settlement,
unless otherwise provided therein:
SEC. 408. Subject Matter for Amicable Settlement; Exception Thereto.—The lupon of each
barangay shall have authority to bring together the parties actually residing in the same
city or municipality for amicable settlement of all disputes except:
(a)Where one party is the government or any subdivision or instrumentality thereof;
(b)Where one party is a public officer or employee, and the dispute relates to the
performance of his official functions;
(c)Offenses punishable by imprisonment exceeding one (1) year or a fine exceeding Five
Thousand pesos (P5,000.00);
(d)Offenses where there is no private offended party;
(e)Where the dispute involves real properties located in different cities or municipalities
unless the parties thereto agree to submit their differences to amicable settlement by an
appropriate lupon;
(f)Disputes involving parties who actually reside in barangays of different cities or
municipalities, except where such barangay units adjoin each other and the parties
thereto agree to submit their differences to amicable settlement by an appropriate lupon;
(g)Such other classes of disputes which the President may determine in the interest of
justice or upon the recommendation of the Secretary of Justice.
The court in which non-criminal cases not falling within the authority of the lupon under
this Code are filed may, at any time before trial, motu proprio refer the case to the lupon
concerned for amicable settlement.
If the complainant/plaintiff fails to comply with the requirements of the Local Government
Code, such complaint filed with the court may be dismissed for failure to exhaust all
administrative remedies.32
The petitioner’s reliance on the ruling of this Court in Diu v. Court of Appeals33 is
misplaced. In that case, there was a confrontation by the parties before the Barangay
Chairman and no agreement was reached. Although no pangkat was formed, the Court
held in that instance that there was substantial compliance with the law. In any event, the
issue in that case was whether the failure to specifically allege that there was no
compliance with the barangay conciliation procedure constitutes a waiver of that defense.
Moreover, no such confrontation before the Lupon occurred with respect to the unlawful
detainer suit against Josephine Pablo before the MTC.34
35
De Joya Civil Procedure
In this case, the petitioner and the respondent Heirs of Carlos Palanca resided in the City
of Manila, albeit in different barangays. The dispute between the petitioner and the
respondent heirs was thus a matter within the authority of the Lupon. Hence, the
petitioner’s complaint for unlawful detainer and the collection of back rentals should have
been first filed before the Lupon for mandatory conciliation, to afford the parties an
opportunity to settle the case amicably. However, the petitioner filed her complaint
against the respondent Heirs of Carlos Palanca directly with the MTC. Clearly then, her
complaint was premature. The execution of the June 5, 1999 Agreement between
petitioner and respondent Josephine Pablo does not amount to substantial compliance to
the requirements of the Local Government Code on mandatory barangay conciliation
proceedings.
Indeed, considering that the MTC had already rendered a decision on the merits of the
case, it is not without reluctance that the Court reaches this conclusion which would
require the petitioner to start again from the beginning. The facts of the present case,
however, do not leave us any choice. To grant the petition under these circumstances
would amount to refusal to give effect to the Local Government Code and to wiping it off
the statute books insofar as ejectment and other cases governed by the Rule on Summary
Procedure are concerned. This Court has no authority to do that.35
IN LIGHT OF ALL THE FOREGOING, the Petition is DENIED.SO ORDERED.
Petition denied.
Notes.—While the Local Government Code of 1991 revised the law on katarungang
pambarangay, and expressly repealed P.D. No. 1508, the jurisprudence built on P.D. 1508
regarding prior referral to the lupon as a pre-condition to the filing of an action in court
remains applicable. (Uy vs. Contreras, 237 SCRA 167 [1994])
Where only a postal office address is indicated in the complaint, it cannot be said that the
parties reside in the same city or municipality, and the dispute is excepted from the
requirement of referral to the barangay lupon or pangkat for conciliation or settlement
prior to filing with the court. (Boleyley vs. Villanueva, 314 SCRA 364 [1999])
KPL
G.R. No. 191336. January 25, 2012.*
CRISANTA ALCARAZ MIGUEL, petitioner, vs. JERRY D. MONTANEZ, respondent.
Civil Law; Compromise Agreements; Amicable Settlements; Barangay Conciliation; An
amicable settlement reached at the barangay conciliation proceedings, is binding between
the contracting parties and, upon its perfection, is immediately executory insofar as it is
not contrary to law, good morals, good customs, public order and public policy.—It is true
that an amicable settlement reached at the barangay conciliation proceedings, like the
Kasunduang Pag-aayos in this case, is binding between the contracting parties and, upon
its perfection, is immediately executory insofar as it is not contrary to law, good morals,
good customs, public order and public policy. This is in accord with the broad precept of
Article 2037 of the Civil Code, viz.: A compromise has upon the parties the effect and
authority of res judicata; but there shall be no execution except in compliance with a
judicial compromise. Being a by-product of mutual concessions and good faith of the
parties, an amicable settlement has the force and effect of res judicata even if not
judicially approved. It transcends being a mere contract binding only upon the parties
thereto, and is akin to a judgment that is subject to execution in accordance with the
Rules. Thus, under Section 417 of the Local Government Code, such amicable settlement
or arbitration award may be enforced by execution by the Barangay Lupon within six (6)
months from the date of settlement, or by filing an action to enforce such settlement in
the appropriate city or municipal court, if beyond the six-month period.
Same; Same; Same; Same; If the amicable settlement is repudiated by one party, either
expressly or impliedly, the other party has two options, namely, to enforce the
compromise in accordance with the Local Government Code or Rules of Court as the case
may be, or to consider it rescinded and insist upon his original demand.—It must be
emphasized, however, that enforcement by execution of the amicable settlement, either
under the first or the second remedy, is only applicable if the contracting parties have not
repudiated such settlement within ten (10) days from the date thereof in accordance with
Section 416 of the Local Government Code. If the amicable settlement is repudiated by
one party, either expressly or impliedly, the other party has two options, namely, to
enforce the compromise in accordance with the Local Government Code or Rules of Court
as the case may be, or to consider it rescinded and insist upon his original demand. This is
in accord with Article 2041 of the Civil Code, which qualifies the broad application of
Article 2037, viz.: If one of the parties fails or refuses to abide by the compromise, the
other party may either enforce the compromise or regard it as rescinded and insist upon
his original demand.
PETITION for review on certiorari of the decision and resolution of the Court of Appeals.
   The facts are stated in the opinion of the Court.
36
De Joya Civil Procedure
  Arellano Law Firm for petitioner.
  Calberto M. Caballero for respondent.
REYES, J.:
Before this Court is a Petition for Review on Certiorari under Rule 45 of the Rules of Court.
Petitioner Crisanta Alcaraz Miguel (Miguel) seeks the reversal and setting aside of the
September 17, 2009 Decision1 and February 11, 2010 Resolution2 of the Court of Appeals
(CA) in CA-G.R. SP No. 100544, entitled “Jerry D. Montanez v. Crisanta Alcaraz Miguel.”
Antecedent Facts
On February 1, 2001, respondent Jerry Montanez (Montanez) secured a loan of One
Hundred Forty-Three Thousand Eight Hundred Sixty-Four Pesos (P143,864.00), payable in
one (1) year, or until February 1, 2002, from the petitioner. The respondent gave as
collateral therefor his house and lot located at Block 39 Lot 39 Phase 3, Palmera Spring,
Bagumbong, Caloocan City.
Due to the respondent’s failure to pay the loan, the petitioner filed a complaint against
the respondent before the Lupong Tagapamayapa of Barangay San Jose, Rodriguez, Rizal.
The parties entered into a Kasunduang Pag-aayos wherein the respondent agreed to pay
his loan in installments in the amount of Two Thousand Pesos (P2,000.00) per month, and
in the event the house and lot given as collateral is sold, the respondent would settle the
balance of the loan in full. However, the respondent still failed to pay, and on December
13, 2004, the Lupong Tagapamayapa issued a certification to file action in court in favor of
the petitioner.
On April 7, 2005, the petitioner filed before the Metropolitan Trial Court (MeTC) of Makati
City, Branch 66, a complaint for Collection of Sum of Money. In his Answer with
Counterclaim,3 the respondent raised the defense of improper venue considering that the
petitioner was a resident of Bagumbong, Caloocan City while he lived in San Mateo,
Rizal.After trial, on August 16, 2006, the MeTC rendered a Decision,4 which disposes as
follows:
“WHEREFORE, premises considered[,] judgment is hereby rendered ordering defendant
Jerry D. Montanez to pay plaintiff the following:
1. The amount of [Php147,893.00] representing the obligation with legal rate of interest
from February 1, 2002 which was the date of the loan maturity until the account is fully
paid;
2. The amount of Php10,000.00 as and by way of attorney’s fees; and the costs.
KPL

SO ORDERED.” 5
On appeal to the Regional Trial Court (RTC) of Makati City, Branch 146, the respondent
raised the same issues cited in his Answer. In its March 14, 2007 Decision,6 the RTC
affirmed the MeTC Decision, disposing as follows:
“WHEREFORE, finding no cogent reason to disturb the findings of the court a quo, the
appeal is hereby DISMISSED, and the DECISION appealed from is hereby AFFIRMED in its
entirety for being in accordance with law and evidence. SO ORDERED.”7
Dissatisfied, the respondent appealed to the CA raising two issues, namely, (1) whether or
not venue was improperly laid, and (2) whether or not the Kasunduang Pag-aayos
effectively novated the loan agreement. On September 17, 2009, the CA rendered the
assailed Decision, disposing as follows:
“WHEREFORE, premises considered, the petition is hereby GRANTED. The appealed
Decision dated March 14, 2007 of the Regional Trial Court (RTC) of Makati City, Branch
146, is REVERSED and SET ASIDE. A new judgment is entered dismissing respondent’s
complaint for collection of sum of money, without prejudice to her right to file the
necessary action to enforce the Kasunduang Pag-aayos. SO ORDERED.”8
Anent the issue of whether or not there is novation of the loan contract, the CA ruled in
the negative. It ratiocinated as follows:
“Judging from the terms of the Kasunduang Pag-aayos, it is clear that no novation of the
old obligation has taken place. Contrary to petitioner’s assertion, there was no reduction
of the term or period originally stipulated. The original period in the first agreement is one
(1) year to be counted from February 1, 2001, or until January 31, 2002. When the
complaint was filed before the barangay on February 2003, the period of the original
agreement had long expired without compliance on the part of petitioner. Hence, there
was nothing to reduce or extend. There was only a change in the terms of payment which
is not incompatible with the old agreement. In other words, the Kasunduang Pag-aayos
merely supplemented the old agreement.”9
The CA went on saying that since the parties entered into a Kasunduang Pag-aayos before
the Lupon ng Barangay, such settlement has the force and effect of a court judgment,
which may be enforced by execution within six (6) months from the date of settlement by
the Lupon ng Barangay, or by court action after the lapse of such time.10 Considering that
more than six (6) months had elapsed from the date of settlement, the CA ruled that the
remedy of the petitioner was to file an action for the execution of the Kasunduang Pag-
37
De Joya Civil Procedure
aayos in court and not for collection of sum of money.11 Consequently, the CA deemed it
unnecessary to resolve the issue on venue.12
The petitioner now comes to this Court.
Issues
(1) Whether or not a complaint for sum of money is the proper remedy for the
petitioner, notwithstanding the Kasunduang Pag-aayos;13 and
(2) Whether or not the CA should have decided the case on the merits rather than
remand the case for the enforcement of the Kasunduang Pag-aayos.14
Our Ruling
Because the respondent failed to comply with the terms of the Kasunduang Pag-aayos,
said agreement is deemed rescinded pursuant to Article 2041 of the New Civil Code and
the petitioner can insist on his original demand. Perforce, the complaint for collection
of sum of money is the proper remedy.
The petitioner contends that the CA erred in ruling that she should have followed the
procedure for enforcement of the amicable settlement as provided in the Revised
Katarungang Pambarangay Law, instead of filing a collection case. The petitioner points
out that the cause of action did not arise from the Kasunduang Pag-aayos but on the
respondent’s breach of the original loan agreement.15
This Court agrees with the petitioner.
It is true that an amicable settlement reached at the barangay conciliation proceedings,
like the Kasunduang Pag-aayos in this case, is binding between the contracting parties
and, upon its perfection, is immediately executory insofar as it is not contrary to law, good
morals, good customs, public order and public policy.16 This is in accord with the broad
precept of Article 2037 of the Civil Code, viz.:
“A compromise has upon the parties the effect and authority of res judicata; but there
shall be no execution except in compliance with a judicial compromise.”
Being a by-product of mutual concessions and good faith of the parties, an amicable
settlement has the force and effect of res judicata even if not judicially approved.17 It
transcends being a mere contract binding only upon the parties thereto, and is akin to a
judgment that is subject to execution in accordance with the Rules.18 Thus, under Section
KPL
417 of the Local Government Code,19 such amicable settlement or arbitration award may
be enforced by execution by the Barangay Lupon within six (6) months from the date of
settlement, It is worthy of notice, in this connection, that, unlike Article 2039 of the same Code, which
speaks of “a cause of annulment or rescission of the compromise” and provides that “the
_______________ compromise may be annulled or rescinded” for the cause therein specified, thus
19 R.A. No. 7160, Book III, Title One, Chapter VII, Section, 417. Execution.—The amicable suggesting an action for annulment or rescission, said Article 2041 confers upon the party
settlement or arbitration award may be enforced by execution by the [L]upon within six (6) concerned, not a “cause” for rescission, or the right to “demand” the rescission of a
months from the date of the settlement. After the lapse of such time, the settlement may compromise, but the authority, not only to “regard it as rescinded”, but, also, to “insist
be enforced by action in the proper city or municipal court.
upon his original demand”. The language of this Article 2041, particularly when contrasted
with that of Article 2039, denotes that no action for rescission is required in said Article
2041, and that the party aggrieved by the breach of a compromise agreement may, if he
or by filing an action to enforce such settlement in the appropriate city or municipal court,
chooses, bring the suit contemplated or involved in his original demand, as if there had
if beyond the six-month period.
never been any compromise agreement, without bringing an action for rescission thereof.
He need not seek a judicial declaration of rescission, for he may “regard” the compromise
Under the first remedy, the proceedings are covered by the Local Government Code and
agreement already “rescinded”.22 (emphasis supplied)
the Katarungang Pambarangay Implementing Rules and Regulations. The Punong
Barangay is called upon during the hearing to determine solely the fact of non-compliance
As so well stated in the case of Chavez v. Court of Appeals,23 a party’s non-compliance
of the terms of the settlement and to give the defaulting party another chance at
with the amicable settlement paved the way for the application of Article 2041 under
voluntarily complying with his obligation under the settlement. Under the second remedy,
which the other party may either enforce the compromise, following the procedure laid
the proceedings are governed by the Rules of Court, as amended. The cause of action is
out in the Revised Katarungang Pambarangay Law, or consider it as rescinded and insist
the amicable settlement itself, which, by operation of law, has the force and effect of a
upon his original demand. To quote:
final judgment.20
“In the case at bar, the Revised Katarungang Pambarangay Law provides for a two-tiered
It must be emphasized, however, that enforcement by execution of the amicable
mode of enforcement of an amicable settlement, to wit: (a) by execution by the Punong
settlement, either under the first or the second remedy, is only applicable if the
Barangay which is quasi-judicial and summary in nature on mere motion of the party
contracting parties have not repudiated such settlement within ten (10) days from the
entitled thereto; and (b) an action in regular form, which remedy is judicial. However, the
date thereof in accordance with Section 416 of the Local Government Code. If the
mode of enforcement does not rule out the right of rescission under Art. 2041 of the Civil
amicable settlement is repudiated by one party, either expressly or impliedly, the other
Code. The availability of the right of rescission is apparent from the wording of Sec. 417
party has two options, namely, to enforce the compromise in accordance with the Local
itself which provides that the amicable settlement “may” be enforced by execution by the
Government Code or Rules of Court as the case may be, or to consider it rescinded and
lupon within six (6) months from its date or by action in the appropriate city or municipal
insist upon his original demand. This is in accord with Article 2041 of the Civil Code, which
court, if beyond that period. The use of the word “may” clearly makes the procedure
qualifies the broad application of Article 2037, viz.:
provided in the Revised Katarungang Pambarangay Law directory or merely optional in
nature.
“If one of the parties fails or refuses to abide by the compromise, the other party may
either enforce the compromise or regard it as rescinded and insist upon his original
  Thus, although the “Kasunduan” executed by petitioner and respondent before the
demand.”
Office of the Barangay Captain had the force and effect of a final judgment of a court,
petitioner’s non-compliance paved the way for the application of Art. 2041 under which
In the case of Leonor v. Sycip,21 the Supreme Court (SC) had the occasion to explain this
respondent may either enforce the compromise, following the procedure laid out in the
provision of law. It ruled that Article 2041 does not require an action for rescission, and
Revised Katarungang Pambarangay Law, or regard it as rescinded and insist upon his
the aggrieved party, by the breach of compromise agreement, may just consider it already
original demand. Respondent chose the latter option when he instituted Civil Case No.
rescinded, to wit:
5139-V-97 for recovery of unrealized profits and reimbursement of advance rentals, moral

38
De Joya Civil Procedure KPL
and exemplary damages, and attorney’s fees. Respondent was not limited to claiming
P150,000.00 because although he agreed to the amount in the “Kasunduan,” it is
axiomatic that a compromise settlement is not an admission of liability but merely a
recognition that there is a dispute and an impending litigation which the parties hope to
prevent by making reciprocal concessions, adjusting their respective positions in the hope
of gaining balanced by the danger of losing. Under the “Kasunduan,” respondent was only
required to execute a waiver of all possible claims arising from the lease contract if
petitioner fully complies with his obligations thereunder. It is undisputed that herein
petitioner did not.”24 (emphasis supplied and citations omitted)
In the instant case, the respondent did not comply with the terms and conditions of the
Kasunduang Pag-aayos. Such non-compliance may be construed as repudiation because it
denotes that the respondent did not intend to be bound by the terms thereof, thereby
negating the very purpose for which it was executed. Perforce, the petitioner has the
option either to enforce the Kasunduang Pag-aayos, or to regard it as rescinded and insist
upon his original demand, in accordance with the provision of Article 2041 of the Civil
Code. Having instituted an action for collection of sum of money, the petitioner obviously
chose to rescind the Kasunduang Pag-aayos. As such, it is error on the part of the CA to
rule that enforcement by execution of said agreement is the appropriate remedy under
the circumstances.
give the respondent a second chance to make good on his undertaking. And since the
respondent still reneged in paying his indebtedness, justice demands that he must be held
answerable therefor.
WHEREFORE, the petition is GRANTED. The assailed decision of the Court of Appeals is SET
ASIDE and the Decision of the Regional Trial Court, Branch 146, Makati City, dated March
14, 2007 is REINSTATED.
SO ORDERED.
Carpio (Chairperson), Perez, Sereno and Perlas-Bernabe,** JJ., concur.
Petition granted, judgment and resolution set aside.
Note.—A detainer suit is premature if it fails to exhaust all administrative remedies, such
as compliance with Section 412 of the Local Government Code on the need for prior
barangay conciliation proceedings. (Villadar, Jr. vs. Zabala, 545 SCRA 325 [2008]) Miguel
vs. Montanez, 664 SCRA 345, G.R. No. 191336 January 25, 2012

Considering that the Kasunduang Pag-aayos is deemed rescinded by the non-compliance

of the respondent of the terms thereof, remanding the case to the trial court for the
enforcement of said agreement is clearly unwarranted.

The petitioner avers that the CA erred in remanding the case to the trial court for the
enforcement of the Kasunduang Pag-aayos as it prolonged the process, “thereby putting
off the case in an indefinite pendency.”25 Thus, the petitioner insists that she should be
allowed to ventilate her rights before this Court and not to repeat the same proceedings
just to comply with the enforcement of the Kasunduang Pag-aayos, in order to finally
enforce her right to payment.26

The CA took off on the wrong premise that enforcement of the Kasunduang Pag-aayos is
the proper remedy, and therefore erred in its conclusion that the case should be
remanded to the trial court. The fact that the petitioner opted to rescind the Kasunduang
Pag-aayos means that she is insisting upon the undertaking of the respondent under the
original loan contract. Thus, the CA should have decided the case on the merits, as an
appeal before it, and not prolong the determination of the issues by remanding it to the
trial court. Pertinently, evidence abounds that the respondent has failed to comply with
his loan obligation. In fact, the Kasunduang Pag-aayos is the well nigh incontrovertible
proof of the respondent’s indebtedness with the petitioner as it was executed precisely to

39
De Joya Civil Procedure KPL