LEOPOLDO SY-QUIA Et al vs. MARY A. MARSMANet al G.R. No.

L-23426 March 1, 1968

Leopoldo Sy-quia Hector Moreno, Alejandro de Santos, Pedro Aguirre and Hans Inhelder commenced quo warranto proceeding against Mary A. Marsman, A. L. Velilla, A. V. Santiago, E. G. Vito and H. A. Doornbosch in the Court of First Instance of Rizal, with the filing of a complaint alleging as follows: 1. Plaintiffs are all of age and residents of the Province of Rizal, except Leopoldo Sy-quia who is a resident of the City of Manila, defendants are all of age and residents of the Province of Rizal, except H. A. Doornbosch who is a resident of the City of Manila, Mary A. Marsman being a widow and all with place of business at the Marsman Building, Buendia Avenue, Makati, Rizal, where they may be served with summons and a copy of this complaint. 2. Prior to December 29, 1960, defendants constituted the Board of Directors of Marsman Investment, Ltd., a corporation duly organized and existing under and by virtue of the laws of the United Kingdom with principal offices in London and Philippine offices at the Marsman Building, Buendia Avenue, Makati, Rizal. 3. On December 29, 1960, at the annual general meeting and extraordinary general meeting of stockholders of said corporation held at its Philippine Offices (Marsman Building), there being a quorom and all prerequisites, formal as well as essential for the holding of said meetings having been complied with, plaintiffs were duly elected, in accordance with the British Companies Act of 1948 and the Articles of Association of said corporation, the governing law on the matter, directors of said Marsman Investments, Ltd. 4. On January 4, 1961, as such directors of Marsman Investments, Ltd., plaintiffs held an organizational meeting at the Marsman Building, site of its Philippine Offices, and, thereafter, plaintiffs, singly as well as collectively, demanded of defendants, who were then within the premises, the vacation of their respective offices as such members of the Board of Directors of Marsman Investments, Ltd. and the turning over of the same to plaintiffs, as well as all the books, accounts, papers and other records of the corporation. 5. Defendants rejected this demand, as well as all other subsequent similar demands made by plaintiffs, and, to this date, have been acting and posing as the lawful members of the Board of Directors of Marsman Investments, Ltd. thereby usurping offices lawfully pertaining to plaintiffs. 6. For the enforcement and protection of their rights so grossly and wantonly violated by defendants, plaintiffs had to retain undersigned counsel whose reasonable fee, until final determination of this case, is P15,000.00. Plaintiffs thus prayed for the ouster of defendants as directors of Marsman Investments, Ltd. and their recognition and institution instead of the latter; for attorneys' fees in the sum of P15,000.00 and costs. Defendants moved for the dismissal of the action pointing to the pendency of other actions (Civ. Case No. 45935, CFI of Manila and Civil Case No. Q-5934, CFI of Rizal), allegedly involving the same parties and over the same cause of action. Upon its denial by the court, defendants filed an answer that reads:

1. With reference to the allegations in paragraph 1, defendants represent that (a) defendant Mary A. Marsman is now deceased, the defendant having died on January 11, 1968 in Palo Alto, California; (b) defendant Alexander Sycip was appointed by the probate court in Sp. Proc. No. 3883, of this Court executor of the estate of Mary A. Marsman; and (c) defendant H.A. Doornbosch no longer resides in the Philippines. 2. They deny the allegation in paragraph 3 that on December 29, 1960 at the annual general meeting and extraordinary general meeting of the stockholders or members of Marsman Investments, Ltd., "plaintiffs were duly elected, in accordance with the British Companies Act of 1948 and the Articles of Association of said corporation, the governing law on the matter, directors of said Marsman Investments, Ltd." 3. They have no knowledge or information sufficient to form a belief as to the truth of the allegation in paragraph 4 that on January 4, 1961, as such directors of Marsman Investments, Ltd., plaintiffs held an organizational meeting at the Marsman Building, site of its Philippine Offices; and they deny the further allegation in paragraph 4 that thereafter, plaintiffs, singly as well as collectively, demanded of defendants, who were then within the premises, the vacation of their respective offices as such members of the Board of Directors of Marsman Investments, Ltd. and the turning over of the same to plaintiffs, as well as all the books, accounts, papers and other records of the corporation. 4. They deny the right of plaintiffs to attorney's fees.1wph1.t As affirmative defenses, it was contended that the complaint should be dismissed as far as Mary A. Marsman and H. A. Doornbosch were concerned; the first having died on January 11, 1963, and the second having vacated his position as director of the corporation. Plaintiffs thereupon filed a motion for judgment on the pleadings, claiming that defendants, by making general denials in their answer, had in effect admitted all the material averments of the complaint. Over defendants' vigorous opposition, the court below sustained plaintiffs' stand, reasoning that the mere repetition by defendants in their answer of the averments of the complaint, even if prefaced by the phrase "that he denies", did not constitute specific denial of plaintiffs' cause of action; and allegations in the answer according to the Court, are just negatives pregnant which amounted to admission of the averments of the complaint. As the answer allegedly failed to tender an issue, plaintiffs were consequently declared the duly elected directors of the Marsman Investments, Ltd. and defendants were ordered to turn over to them all the books, accounts, papers and other records of the corporation. Plaintiffs' demand for attorneys' fees, however, was denied, for not being substantiated by evidence. Hence, this appeal by the defendants. We find this appeal to be without merit.1wph1.t A comparison of paragraph 3 of the complaint and paragraph 2 of the answer will show that the answer in effect denies each and every allegation of plaintiffs, with the result that the denial is general and not specific as required by the Rules (Revised Rule 8, sec. 10) providing: Sec. 10. Specific denial. The defendant must specify each material allegation of fact the truth of which he does not admit and, whenever practicable, shall set forth the substance of the matters which he will rely upon to support his denial. Where a pleader desires to deny only a part or a qualification of an averment, he shall specify so much of it as is true and material and shall deny only the remainder. Where the defendant is without knowledge or information sufficient to form a belief as to the truth of a material averment made in the complaint, he shall so state, and this shall have the effect of a denial.

There is no difference between an averment that a defendant "denies each and every allegation" and a plea whereby the defendant, as in this case, denies the recitals of the complaint reproduced in the answer. If the first mode of denial is and has been declared a general denial,1 the second should be equally so held. For the answer before us, in reality, leaves in doubt all the averments of paragraph 3 of the complaint: defendants-appellants do not specify therein whether what they deny is that the annual general meeting was held, or whether it is the fact that plaintiffs were elected directors, or whether the election was held conformably to the British laws governing the matter. In addition, the Rules require that besides specifying the allegations of fact not admitted, the answer should set forth the matters relied upon in support of the denial;2 so that in effect, the Rules are no longer satisfied with mere denials, even if specific, but demand that defendant manifest what he considers to be the true facts. Note that our Rules do not permit a party to deny everything in his opponent's pleading, as it could under Rule 8, subsection (b) of the Federal Rules of Civil Procedure [I Moran, Rules of Court, p. 280, 1963 Ed.]. The defendants-appellants do not aver any matters to support their denials. The rule, it is true, qualifies the requirement with the words "if practicable": but the defendants nowhere attempted to demonstrate why it was not practicable for them to aver the facts that negate or contradict the plaintiffs' allegations. Hence, the denial in paragraph 2 of the answer are but general denials that operate as an admission of the facts pleaded in paragraph 3 of the complaint. With regard to the plea of lack of knowledge or information set up in paragraph 3 of the answer, this Court's decision in Warner Barnes vs. Reyes, 103 Phil. 662, 665, is authority for the proposition that this form of denial must be availed of with sincerity and good faith, not for the purpose of confusing the other party, nor for purposes of delay. Yet, so lacking in sincerity and good faith is this part of the answer that defendants-appellants go to the limit of denying knowledge or information as to whether they (defendant's) were in the premises (Marsman Bldg.) on January 4, 1961, as averred in paragraph 4 of the complaint. Yet whether such a fact was or was not true could not be unknown to these defendants. Very plainly, appellants here systematically adopted the tactic of trapping and confusing plaintiffs as to what facts they had to prove or what issues must be met. Even their so-called special defenses were likewise evasive, and did not touch the heart of the controversy. Such strategy we can not sanction. It is violative of the policy of fair disclosure of facts required by the Rules. Hence, we hold that no error was committed by the Court below in concluding that the answer tendered no issue, and that judgment on the pleading was warranted. Defendants-appellants argue that if the answer tended to confuse plaintiffs, their remedy lay in a motion for particulars. But, the Rules placed on appellants the duty to be specific as to their contentions: what facts they denied and what facts they know or believe to have actually happened. They did not do so. To require plaintiffs now to ask for particulars is to enable defendants to delay the trial and disposition of the case by ignoring in their answer what the rules require. They would thus reap benefit from their own wrong. FOR THE FOREGOING REASONS, the order and judgment appealed from are affirmed. Costs against appellants in all instances. So ordered.

Republic of the Philippines SUPREME COURT Manila THIRD DIVISION A.M. No. 06-9-545-RTC January 31, 2008

Re: CONVICTION OF JUDGE ADORACION G. ANGELES, REGIONAL TRIAL COURT, BRANCH 121, CALOOCAN CITY IN CRIMINAL CASE NOS. Q-97-69655 to 56 FOR CHILD ABUSE DECISION NACHURA, J.: Before this Court is yet another administrative case confronting respondent Adoracion G. Angeles (respondent), Presiding Judge of the Regional Trial Court (RTC), Branch 121, Caloocan City (sala) filed by the Office of the Court Administrator 1 (OCA) recommending that she be suspended pending the outcome of this administrative case. The Facts On July 17, 2006, the RTC, Branch 100, Quezon City rendered a Decision 2 in Criminal Case Nos. Q-97-69655-56 convicting respondent of violation of Republic Act (RA) No. 7610.3 The criminal cases are now on appeal before the Court of Appeals (CA).4 On July 25, 2006, Senior State Prosecutor Emmanuel Y. Velasco (SSP Velasco) of the Department of Justice (DOJ) wrote a letter5 to then Chief Justice Artemio V. Panganiban inquiring whether it is possible for this Court, in the public interest, motu proprio to order the immediate suspension of the respondent in view of the aforementioned RTC Decision. SSP Velasco opined: 1. Judge Angeles now stands convicted on two counts of a crime, child abuse under Republic Act 7610, which involves moral turpitude. Until she clears her name of such conviction, her current moral qualification to do the work of a judge is under a dark cloud. Litigants seeking justice in our courts are entitled to a hearing by judges whose moral qualifications are not placed in serious doubt. 2. Although her conviction is not yet final, the presumption of innocence that Judge Angeles enjoyed during the pendency of the trial has already been overcome by its result. The presumption today is that she is guilty and must clear her name of the charges. xxxx It simply would not be right to have a person presumably guilty of a crime involving moral turpitude to hear and adjudicate the cases of others.

3. Under section 5 of Rule 114 of the Rules of Criminal Procedure, since the RTC of Quezon City convicted Judge Angeles of an offense not punishable by death, reclusion perpetua or life imprisonment, she no longer has a right to bail and, therefore, should ordinarily be held in prison pending adjudication of her appeal. That the RTC of Quezon City chose to exercise its discretionary power to nonetheless grant her bail does not change the fact that, except for the bail, Judge Angeles' rightful place by reason of conviction is within the confinement of prison. It would seem incongruous for the Supreme Court to allow convicted felons out on bail to hear and adjudicate cases in its courts. 4. Finally, as a sitting judge who wields power over all persons appearing before her and has immeasurable influence within the judicial system as one of its members, Judge Angeles could definitely cause pressure to bear, not only on the members of the Court of Appeals and, possibly, the Supreme Court, but also on the Office of the Solicitor General that prosecutes her case on appeal. Only temporary suspension from official function, pending resolution of her case, will neutralize her judicial clout and clear the air of any kind of suspicion that justice is not going well in her case. On July 27, 2006, the matter was referred to the OCA for comment and recommendation.6 On the basis of SSP Velasco's letter and by virtue of this Court's Resolution 7 dated March 31, 1981, the OCA submitted to this Court a Report 8 dated August 25, 2006 with an attached Administrative Complaint,9 the dispositive portion of which reads as follows: WHEREFORE, it is respectfully prayed that this administrative complaint be given due course and, respondent be ordered to file her Comment within ten (10) days from receipt. Considering the evidence is prima facie strong, it is respectfully recommended that she be INDEFINITELY SUSPENDED pending the outcome of the instant case or until further orders from this Court. It is further recommended that after the Comment is filed, the administrative proceeding be suspended to await the final outcome of the criminal cases filed against her. In a Resolution10 dated September 18, 2006, this Court's Second Division approved all of these recommendations, thus, suspending respondent from performing her judicial functions while awaiting the final resolution of her criminal cases or until further orders from this Court. On October 6, 2006, respondent filed an Urgent Motion for Reconsideration 11 of the aforementioned Resolution. Respondent claimed that the suspension order was wielded against her without affording her the opportunity to be heard since she was not furnished copies of SSP Velasco's letter and OCA's Administrative Complaint. Thus, respondent submitted that her suspension is essentially unjust. Moreover, respondent manifested that the two criminal cases against her are on appeal before the CA and have, therefore, not yet attained finality. As such, respondent still enjoys the constitutional presumption of innocence and her suspension clashes with this presumption and is tantamount to a prejudgment of her guilt. On the other hand, on October 11, 2006, SSP Velasco filed an Urgent Appeal/Manifestation 12 to the Court En Banc on the alleged unethical conduct of respondent, seeking the immediate implementation of this Court's Resolution dated September 18, 2006. On October 16, 2007, SSP Velasco filed an Opposition to the said Motion for Reconsideration, 13 manifesting that respondent continuously defied this Court's Resolution dated September 18, 2006 as she did not desist from performing her judicial functions despite her receipt of said Resolution on October 6, 2006. SSP Velasco stressed that an order of suspension issued by this Court is immediately executory notwithstanding the filing of a motion for reconsideration. Moreover, SSP Velasco reiterated that due to her conviction on two counts of child abuse, respondent no longer

enjoys the constitutional presumption of innocence and should remain suspended in order to erase any suspicion that she is using her influence to obtain a favorable decision and in order to maintain and reaffirm the people's faith in the integrity of the judiciary. Correlatively, the Integrated Bar of the Philippines-Caloocan, Malabon, Navotas Chapter (IBP-CALMANA Chapter), through its Public Relations Officer (PRO) Atty. Emiliano A. Mackay, wrote a letter14 dated October 18, 2006 addressed to the Second Division of this Court inquiring as to the effectivity of the Resolution suspending the respondent so as not to sow confusion among the legal practitioners and party litigants with pending cases before the respondent's sala. Likewise, the IBP-CALMANA Chapter manifested that respondent did not cease to perform her judicial functions as evidenced by a Commitment Order15 issued by respondent on October 16, 2006, and handwritten manifestations16 of some party litigants attesting that on various dates they attended hearings before respondent's sala. In the same vein, in an undated letter17 addressed to Associate Justice Angelina Sandoval-Gutierrez, the Concerned Trial Lawyers in the City of Caloocan raised the same concern before this Court. In her Reply18 to SSP Velasco's Opposition, respondent admitted that she continued discharging her bounden duties in utmost good faith after filing her motion for reconsideration. She averred that she did not have the slightest intention to defy or ignore this Court's Resolution which did not categorically state that the said suspension is immediately executory. Respondent reiterated her arguments against the suspension order on the grounds that she was deprived of due process; that her conviction is not yet final; and that the crimes for which she was convicted have nothing to do with the discharge of her official duties. Lastly, respondent claimed that the instant case is but another harassment suit filed against her by SSP Velasco because she earlier filed an administrative complaint against the latter for maliciously indicting respondent with respect to another case of child abuse. On October 25, 2006, respondent filed a Manifestation of Voluntary Inhibition 19 stating that she is voluntarily inhibiting from handling all cases scheduled for hearing before her sala from October 25, 2006 to November 13, 2006. On October 27, 2006, the OCA conducted a judicial audit in respondent's sala. Per Report20 of the judicial audit team, it was established that from October 6, 2006 to October 23, 2006, respondent conducted hearings, issued orders, decided cases and resolved motions, acting as if the order of suspension which the respondent received on October 6, 2006 was only a "mirage." The Report was brought to the attention of Chief Justice Reynato S. Puno by Court Administrator Christopher O. Lock (CA Lock).21 On October 30, 2006, SSP Velasco filed an Administrative Complaint against respondent for violation of the Court's Circulars, the New Code of Judicial Conduct, and the Civil Service Rules and Regulations, and for Gross Misconduct, asseverating, among others, that the suspension order was immediately executory22 and that integrity as mandated by the New Code of Judicial Conduct is essential not only to the proper discharge of the judicial office but also to the personal demeanor of judges. In her Comment,23 respondent, in addition to her previous contentions, argued that the Resolution dated September 18, 2006 ordering her suspension was issued only by a Division of this Court contrary to Section 11, Article VIII of the Constitution, which provides that " the Supreme Court en banc shall have the power to discipline judges of lower courts, or order their dismissal by a vote of a majority of the Members who actually took part in the deliberations on the issues in the case and voted thereon ." On November 9, 2006, SSP Velasco filed a Supplement to the Opposition to Respondent's Urgent Motion for Reconsideration 24 of the Resolution dated September 18, 2006. Thereafter, numerous pleadings 25 were filed by both parties practically repeating their previous allegations. Subsequently, in a Resolution dated February 19, 2007, this Court lifted the suspension of respondent on the ground that:

Upon verification, it appears that the Office of the Clerk of Court, Second Division, indeed failed to attach a copy of the OCA complaint to the copy of our resolution dated September 18, 2006 sent to Judge Angeles. Due process requires that Judge Angeles be accorded the opportunity to answer the complaint. Respondent was then given a fresh period of ten (10) days from the receipt of the OCA Administrative Complaint within which to file her comment. On March 15, 2007, respondent filed her Comment 26 with the following material assertions: (1) that CA Lock as Court Administrator and who in behalf of the OCA stands as the complainant in this case, has no personal knowledge of the facts, issues and evidence presented in the criminal cases; (2) that the instant case, filed eleven (11) years after the criminal charges for child abuse were filed by Nancy Gaspar and Proclyn Pacay, smacks of malice and bad faith on the part of CA Lock; (3) that CA Lock is a friend and former subordinate of then National Bureau of Investigation (NBI) Director Epimaco Velasco (Director Velasco), father of herein party SSP Velasco, thus, CA Lock's ill motive against respondent is clear; (4) that CA Lock should not use the OCA to harass a member of the judiciary; (5) that the decision in the aforementioned criminal cases has not yet become final; (6) that the acts for which she was convicted are totally alien to her official functions and have nothing to do with her fitness and competence as a judge; (7) that there is no wisdom in the imposition of the suspension which in this case is preventive in character because respondent cannot do anything through her office that could possibly cause prejudice to the prosecution of the child abuse case; (8) that the lifting of the suspension order retroacts to the date of its issuance; (9) that the instant case should be struck down because the judgment of conviction was contrary to law and jurisprudence; and (10) that under the circumstances, all the charges were merely concocted by respondent's detractors in order to embarrass, humiliate and vex her. In his Motion for Reconsideration27 of this Court's Resolution dated February 19, 2007, SSP Velasco argued that respondent's deprivation of her right to due process was cured when she filed her motion for the reconsideration of the suspension order; thus, there is no need to lift such order. He reiterated his previous statement that "as a sitting judge who wields power over all persons appearing before her and thus has immeasurable influence within the judicial system as one of its members, Judge Angeles could definitely cause pressure to bear, not only on the members of the Court of Appeals and, possibly, the Supreme Court, but also on the Office of the Solicitor General (OSG) that prosecutes her case on appeal. Only her suspension from official function, pending resolution of her case, will neutralize her judicial clout and clear the air of any kind of suspicion that justice is not going well in her case ."28 In response, respondent filed a Comment/Opposition to the said motion with a Motion to Declare SSP Velasco in contempt of Court29 due to this aforementioned statement. Respondent argued that such statement betrays SSP Velasco's cheap and low perception of the integrity and independence of this Court, of the CA and of the OSG. It also shows his utter lack of respect for the judicial system. Moreover, respondent added that since she was not furnished a copy of the OCA Administrative Complaint, the issuance of the suspension order deprived her of her right to due process and prevented her from fully ventilating her arguments. Respondent, likewise, questioned SSP Velasco's legal personality in this case as it was the OCA which, motu proprio, initiated the filing of the said case. In a Resolution dated July 4, 2007, this Court, among others, directed SSP Velasco to file his comment on respondent's motion to cite him for contempt. On August 21, 2007, SSP Velasco filed his Comment claiming that he has legal personality to file pleadings before this Court because it was he who initiated the filing of this case through his letter to then Chief Justice Artemio V. Panganiban on July 25, 2006. He admitted that the allegedly contemptuous statements were merely lifted from said letter. He argued that the former Chief Justice or the Court for that matter, did not find any contemptuous statement in the letter. Taking the letter in its entire context, SSP Velasco posited that he did not commit any act of disobedience to the orders of this Court; neither did he bring the Court's authority and the administration of law into

disrepute nor did he impede the due administration of justice. Nowhere in the letter was it stated that this Court, the CA and the OSG could be pressured; the letter merely stated that respondent could cause pressure. SSP Velasco pointed that the letter to the then Chief Justice, in itself, shows his respect for the judiciary and the promotion of the administration of justice. In her Reply30 to said Comment, respondent argued that it cannot be said that somebody could cause pressure if no one is believed to be susceptible to pressure. Thus, the use of this kind of language tends to degrade the administration of justice and constitutes indirect contempt. She stressed that SSP Velasco's act of misrepresenting himself as the complainant in this case while it is clear from the Resolution of this Court that the OCA motu proprio filed the same, is per se contemptuous. Meanwhile in its Memorandum,31 the OCA reiterated its earlier position that respondent should be suspended pending the outcome of this administrative case. The OCA opined that the Resolution lifting the suspension order was basically premised on the ground that respondent was not accorded her right to due process. By filing her Comment raising arguments against her suspension, respondent has fully availed herself of such right. However, the OCA submitted that respondent's arguments are devoid of merit on the following grounds: (1) the Court Administrator need not personally know about the criminal cases of respondent because the instant case is based on a public document, i.e., the decision of the RTC convicting the respondent of child abuse; (2) the fact that said decision has not attained finality is of no moment for what is being sought is merely preventive suspension. Thus, in the event that respondent is acquitted in the criminal cases of which she stands accused, she will receive the salaries and other benefits which she would not receive during her suspension; (3) even if the acts of child abuse have no connection with respondent's official functions as a judge, it is established that the private conduct of judges cannot be dissociated from their official functions; (4) respondent's preventive suspension shall serve an important purpose: it will protect the image of the judiciary and preserve the faith of the people in the same; and (5) citing the case of Leonida Vistan v. Judge Ruben T. Nicolas ,32 the RTC decision convicting respondent of child abuse is prima facie evidence that respondent committed the said crime which indicates the moral depravity of the offender and, as such, warrants the punishment of dismissal from the service. Thus, the OCA recommended that respondent be suspended pending the outcome of this administrative case and that the CA be directed to resolve the criminal cases with dispatch. The Issues There are two ultimate issues in this case: First, whether or not grounds exist to cite SSP Velasco for indirect contempt of Court; and Second, whether or not grounds exist to preventively suspend the respondent pending the resolution of this administrative case. The Court's Ruling We resolve the first issue in the negative. In Pilar Barredo-Fuentes v. Judge Romeo C. Albarracin,33 we held: Contempt of court is a defiance of the authority, justice or dignity of the court, such conduct as tends to bring the authority and administration of the law into disrespect or to interfere with or prejudice parties, litigant or their witnesses during litigation.

There are two kinds of contempt punishable by law: direct contempt and indirect contempt. Direct contempt is committed when a person is guilty of misbehavior in the presence of or so near a court as to obstruct or interrupt the proceedings before the same, including disrespect toward the court, offensive personalities toward others, or refusal to be sworn or to answer as a witness, or to subscribe an affidavit or deposition when lawfully required to do so. Indirect contempt or constructive contempt is that which is committed out of the presence of the court. Any improper conduct tending, directly or indirectly, to impede, obstruct, or degrade the administration of justice would constitute indirect contempt. In her Comment/Opposition with Motion to Declare SSP Velasco in contempt of Court, respondent espoused the view that SSP Velasco is guilty of indirect contempt for using language which tends to degrade the administration of justice. But if this were so, respondent should have availed herself of the remedy in accordance with Section 4, Rule 71 of the Rules of Court, viz: SEC. 4. How proceedings commenced. - Proceedings for indirect contempt may be initiated motu proprio by the court against which the contempt was committed by an order or any other formal charge requiring the respondent to show cause why he should not be punished for contempt. In all other cases, charges for indirect contempt shall be commenced by a verified petition with supporting particulars and certified true copies of documents or papers involved therein, and upon full compliance with the requirements for filing initiatory pleadings for civil actions in the court concerned . . . . (Emphasis supplied) A charge of indirect contempt must be filed in the form of a verified petition if it is not initiated directly by the court against which the contemptuous act was committed. On previous occasions, we clarified that such petition is in the nature of a special civil action. Certified true copies of related documents must be submitted with the petition and appropriate docket fees must be paid. The requirement of a verified petition is mandatory. As Justice Florenz D. Regalado has explained: This new provision clarifies with a regulatory norm the proper procedure for commencing contempt proceedings. While such proceeding has been classified as a special civil action under the former Rules, the heterogeneous practice, tolerated by the courts, has been for any party to file a mere motion without paying any docket or lawful fees therefor and without complying with the requirements for initiatory pleadings, which is now required in the second paragraph of [Section 4].34 On the charge of indirect contempt of court, we therefore find that SSP Velasco's statement, while irresponsible, did not necessarily degrade the administration of justice as to be considered contumacious. The salutary rule is that the power to punish for contempt must be exercised on the preservative, not vindictive principle, and on the corrective and not retaliatory idea of punishment. A lawyer's remarks explaining his position in a case under consideration do not necessarily assume the level of contempt that justifies the court's exercise of the power of contempt.35 We note that SSP Velasco's statement was made in support of his argument for the imposition of preventive suspension, i.e., to prevent the respondent from using her current position to alter the course of the investigation and the disposition of the appealed criminal cases. Nevertheless, SSP Velasco must bear in mind that as a lawyer, he must be circumspect in his language. We remind him of our admonition to all lawyers to observe the following Canons of the Code of Professional Responsibility, which read: Canon 8. Rule 8.01 - A lawyer shall not, in his professional dealings, use language which is abusive, offensive or otherwise improper.

Canon 11. A lawyer shall observe and maintain the respect due to the courts and to judicial officers and should insist on similar conduct by others. A lawyer is an officer of the Court. It is a lawyer's sworn and moral duty to help build and not unnecessarily destroy the people's high esteem and regard for the courts so essential to the proper administration of justice. A lawyer's language may be forceful but should always be dignified; emphatic but respectful, as befitting an advocate. Arguments, whether written or oral, should be gracious to both court and opposing counsel, and should use such language as may be properly addressed by one person to another. 36 We likewise resolve the second issue in the negative. The Court cannot fully agree with the recommendation of the OCA. Pertinent is our ruling in Emmanuel Ymson Velasco v. Judge Adoracion G. Angeles ,37 which involved the same parties and where we held: An act unrelated to a judge's discharge of judicial functions may give rise to administrative liability even when such act constitutes a violation of penal law. When the issue is administrative liability, the quantum of proof required is only substantial evidence, or that amount of relevant evidence which a reasonable mind might accept as adequate to support a conclusion. Evidence to support a conviction in a criminal case is not necessary, and the dismissal of the criminal case against the respondent in an administrative case is not a ground for the dismissal of the administrative case. Conversely, conviction in the criminal case will not automatically warrant a finding of guilt in the administrative case. We emphasize the well-settled rule that criminal and civil cases are altogether different from administrative matters, and each must be disposed of according to the facts and the law applicable to it. In Nuez v. Atty. Arturo B. Astorga,38 the Court held that the mere existence of pending criminal charges against the respondent-lawyer cannot be a ground for disbarment or suspension of the latter. To hold otherwise would open the door to harassment of attorneys through the mere filing of numerous criminal cases against them. By parity of reasoning, the fact of respondent's conviction by the RTC does not necessarily warrant her suspension. We agree with respondent's argument that since her conviction of the crime of child abuse is currently on appeal before the CA, the same has not yet attained finality. As such, she still enjoys the constitutional presumption of innocence. It must be remembered that the existence of a presumption indicating the guilt of the accused does not in itself destroy the constitutional presumption of innocence unless the inculpating presumption, together with all the evidence, or the lack of any evidence or explanation, proves the accused's guilt beyond a reasonable doubt. Until the accused's guilt is shown in this manner, the presumption of innocence continues. 39 In Mangubat v. Sandiganbayan,40 the Court held that respondent Sandiganbayan did not act with grave abuse of discretion, correctible by certiorari, when it ruled that despite her convictions, "Preagido has still in her favor the constitutional presumption of innocence x x x (and until) a promulgation of final conviction is made, this constitutional mandate prevails ." The Court therein further held that such ruling is not bereft of legal or logical foundation and cannot, in any sense, be characterized as a whimsical or capricious exercise of judgment. So also must we hold in this case. Moreover, it is established that any administrative complaint leveled against a judge must always be examined with a discriminating eye, for its consequential effects are, by their nature, highly penal, such that the respondent judge stands to face the sanction of dismissal or disbarment.41 As aforementioned, the filing of criminal cases against judges may be used as tools to harass them and may in the long run create adverse consequences. The OCA, as well as SSP Velasco, failed to prove that other than the fact that a judgment of conviction for child abuse was rendered against the respondent, which is still on appeal, there are other lawful grounds to support the imposition of preventive

suspension. Based on the foregoing disquisition, the Court is of the resolve that, while it is true that preventive suspension pendente lite does not violate the right of the accused to be presumed innocent as the same is not a penalty, 42 the rules on preventive suspension of judges, not having been expressly included in the Rules of Court, are amorphous at best. 43 Likewise, we consider respondent's argument that there is no urgency in imposing preventive suspension as the criminal cases are now before the CA, and that she cannot, by using her present position as an RTC Judge, do anything to influence the CA to render a decision in her favor. The issue of preventive suspension has also been rendered moot as the Court opted to resolve this administrative case. However, even as we find that the OCA and SSP Velasco have not clearly and convincingly shown ample grounds to warrant the imposition of preventive suspension, we do note the use of offensive language in respondent's pleadings, not only against SSP Velasco but also against former CA Lock. To reiterate our previous ruling involving the respondent, her use of disrespectful language in her Comment is certainly below the standard expected of an officer of the court. The esteemed position of a magistrate of the law demands temperance, patience and courtesy both in conduct and in language.44 Illustrative are the following statements: "CA Lock's hostile mindset and his superstar complex"; 45 "In a frenzied display of arrogance and power"; 46 "(CA Lock's) complaint is merely a pathetic echo of the findings of the trial court";47 and "when (CA Lock) himself loses his objectivity and misuses the full powers of his Office to persecute the object of his fancy, then it is time for him to step down."48 In the attempt to discredit CA Lock, respondent even dragged CA Lock's son into the controversy, to wit: It is noteworthy to mention that CA Lock's hostile attitude was aggravated by his embarrassment when the undersigned mentioned to him that she knew how he used his influence to secure a position for his son at the RTC Library of Pasay City which was then managed by Judge Priscilla Mijares. CA Lock had made sure that his son be assigned to the library to enable the latter to conveniently adjust his schedule in reviewing for the bar examination. Neither was SSP Velasco spared. Of him, the respondent said: "A reading of the motion for reconsideration readily discloses that it is mainly anchored on SSP Velasco's malicious speculations about the guilt of the undersigned. Speculations, especially those that emanate from the poisonous intentions of attention-seeking individuals, are no different from garbage that should be rejected outright ";49 and "His malicious insinuation is no less than a revelation of his warped mindset that a person's position could cause pressure to bear among government officials. This brings forth a nagging question. Did SSP Velasco use his position at the DOJ to 'cause pressure to bear' and obtain a favorable disposition of the administrative cases lodged against him by the undersigned? Is he afraid of his own ghost?"50 It must be stressed again that, as a dispenser of justice, respondent should exercise judicial temperament at all times, avoiding vulgar and insulting language. She must maintain composure and equanimity. The judicial office circumscribes the personal conduct of a judge and imposes a number of restrictions. This is the price that judges have to pay for accepting and occupying their exalted positions in the administration of justice.51 One final word. The parties herein have admitted in their various pleadings that they have filed numerous cases against each other. We do not begrudge them the prerogative to initiate charges against those who, in their opinion, may have wronged them. But it is well to remind them that this privilege must be exercised with prudence, when there are clearly lawful grounds, and only in the pursuit of truth and justice. This prerogative does not give them the right to institute shotgun charges with reckless abandon, or allow their disagreement to deteriorate into a puerile quarrel, not unlike that of two irresponsible children. Judge Angeles and SSP Velasco should bear in mind that they are high-ranking public officers whom the people look up to for zealous, conscientious and responsive public service. Name-calling hardly becomes them.

Cognizant of the adverse impact and unpleasant consequences this continuing conflict will inflict on the public service, we find both officials wanting in the conduct demanded of public servants. WHEREFORE, the instant administrative complaint is hereby DISMISSED for lack of merit. Nevertheless, respondent Adoracion G. Angeles, Presiding Judge of the Regional Trial Court of Caloocan City, Branch 121, is hereby REPRIMANDED for her use of intemperate language in her pleadings and is STERNLY WARNED that a repetition of the same or similar act shall merit a more severe sanction. Senior State Prosecutor Emmanuel Y. Velasco of the Department of Justice is hereby WARNED that he should be more circumspect in the statements made in his pleadings and that a repetition of the same shall be dealt with more severely. The motion to cite him for contempt is DENIED for lack of merit. The Court of Appeals is DIRECTED to resolve CA-G.R. CR No. 30260 involving respondent Judge Adoracion G. Angeles with dispatch. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. 114732 August 1, 2000

ESTRELLA TIONGCO YARED (now deceased) substituted by one of her heirs, CARMEN MATILDE M. TIONGCO petitioner, vs. HON. RICARDO M. ILARDE, Presiding Judge, Regional Trial Court of Iloilo, Br. 26, JOSE B. TIONGCO and ANTONIO G. DORONILA, JR., respondents. DECISION DE LEON, JR., J.: Before us is a petition for certiorari under Rule 65 assailing the Order dated March 17, 1994 1 of the Regional Trial Court of Iloilo City, Branch 26, which reinstated an earlier order cancelling the notice of lis pendens annotated on the back of Transfer Certificates of Title Nos. T-92383 and T-5050, of the Registry of Deeds of Iloilo City covering Lots 3244 and 3246, respectively, located in Iloilo City. The relevant facts are summarized as follows: On October 17, 1990, petitioner Estrella Tiongco Yared filed an amended complaint2 before the Regional Trial Court, 6th Judicial Region, Branch XXVI, against private respondents Jose B. Tiongco and Antonio Doronila, Jr. Docketed as Civil Case No. 19408, the action was one for "annulment of affidavit of adjudication, sales, transfer certificates of title, reconveyance and damages." In brief, the amended complaint alleged that respondent Tiongco, on the basis of an affidavit of adjudication dated April 17, 1974 alleging that he is the sole surviving heir of the previous owner, Maria Luis de Tiongco, succeeded in having the subject properties registered in his name, to the prejudice of the other surviving heir of the previous owner, petitioner among them. Petitioner and respondent Tiongco's father were siblings, and both were among several heirs of Maria Luis de Tiongco. The aforesaid affidavit of adjudication was registered with the Office of the Register of Deeds of Iloilo City on May 10, 1974. Petitioner prayed that the properties be reconveyed to the original registered owners, subject to partition among the lawful heirs, and that respondent Tiongco be ordered to pay damages and costs. To protect her interest in the properties during the pendency of the case, petitioner caused to be annotated on Transfer Certificate of Title Nos. T-52547, T-4666 and T-52546,3 which covered Lot Nos. 3244, 3246 and 1404 , respectively. TCT Nos. T-92383 and T-5050 were derived or transferred from TCT Nos. T-52547 and T-4666 respectively and registered in the name of Tiongco. After respondent Jose B. Tiongco filed his answer, trial ensued during which, on three separate occasions, he filed motions seeking the cancellation of the notices of lis pendens.4 All these motions were denied.5

On December 14, 1993, the respondent judge issued a Decision6 dismissing petitioner's complaint and private respondent's counterclaim. The trial court found that petitioner's cause of action had already prescribed. Petitioner filed a notice of appeal 7 on December 17, 1993. As before, respondent Tiongco filed a motion for cancellation of the notices of lis pendens8 dated December 21, 1993; this was denied in an Order dated January 10, 1994.9 He filed a "Second Motion for Reconsideration"10 which was also denied in an Order dated January 26, 1994. 11 Displaying remarkable tenacity, respondent Tiongco filed a "Third Motion for Reconsideration."12 This time, however, his arguments proved persuasive. In an Order13 dated February 14, 1994, the respondent judge ruled to wit: In the light of the ruling laid down in Magdalena Homeowners Association Inc. vs. Court of Appeals, 184 SCRA 325; 330 (1990), cited in Vda. De Kilayko vs. Tengco, 207 SCRA 600; 614-615 (1992), that "the continuance or removal of a notice of lis pendens is not contingent on the existence of a final judgment in the action and ordinarily has no effect on the merits thereof" so that the notices of lis pendens in the case at bar may, on proper grounds, be cancelled notwithstanding the non-finality of the judgment of this Court brought about by plaintiff's appeal and considering the finding of this Court that plaintiff's action had already prescribed, which finding is based on the admitted fact that the questioned deed of adjudication was registered way back of May 10, 1974 so that the possibility of this finding being reversed is quite remote if not totally nil and, considering further, the circumstances obtaining in this case, among which are: (1) that the criminal complaint for perjury filed by plaintiff against defendant Jose B. Tiongco based on the same deed of adjudication had already been dismissed with finality also on the ground of prescription; (2) that the occupants of the property who were alleged as formerly paying rentals to herein plaintiff, Estrella Tiongco Yared, had already recognized defendant's ownership and had long stopped paying rentals to plaintiff without the latter intervening, much less, contesting the decision in Civil Case No. 15421 where defendant Jose B. Tiongco was declared with finality as the true and lawful owner of Lots Nos. 3244 and 3246; and (3) that, if at all, the present claim of plaintiff covers but a very small portion of subject lots consisting only a total of about 64 square meters hence, it would be unfair to the defendant who has torrens title covering the parcels of lands solely in his name to have the same subjected to the harsh effect of such a encumbrance; the Court, in view of all the foregoing considerations and upon further review of the records, hereby reconsiders its stand on the subject matter of lis pendens and so holds that the continued annotation of subject notices of lis pendens is intended to molest the defendant, Jose B. Tiongco, and is not necessary to protect the rights of plaintiff as such rights, if any, are now foreclosed by prescription. This time, it was petitioner's turn to seek reconsideration.14 On March 4, 1994, the public respondent issued an Order15 reversing himself on the ground that (1) it had already lost jurisdiction over the case due to the expiration of the last day to appeal of both parties, (2) the notice of appeal has been approved, and (3) the records had been ordered elevated to the Court of Appeals. Private respondent Tiongco filed another motion for reconsideration 16 against the Order dated March 4, 1994. On March 17, 1994, the respondent judge issued the order, subject of this petition, which is quoted hereunder: Considering that under Section 9, Rule 41 of the Rules of Court, although appeal had already been perfected, the Court, prior to the transmittal of the records to the appellate court, may issue orders for the protection and preservation of the rights of the parties which do not involve any matter litigated by the appeal and considering that in the case at bar, lis pendens is not a matter litigated in the appeal and the records have not as yet been transmitted to the appellate court so that this Court still has jurisdiction to issue the Order of February 14, 1994 cancelling the notices of lis pendens annotated on TCT No. T-92383 covering Lot 3244 and on TCT No. T-5050 covering lot 3246 and considering further, that the said Order does not direct cancellation of lis pendens annotated on TCT No. T-89483 covering Lot no. 1404 which contains a total area of 1,587 square meters where the area of 64 square meters claimed by plaintiff can very well be taken; as prayed for by the defendant Jose B. Tiongco, the Order of March 4, 1994 is hereby reconsidered and set aside and the Order of February 14, 1994 is hereby

reconsidered and set aside and the Order of February 14, 1994 cancelling the notices of lis pendens on TCT No. T-92383 covering lot 3244 and on TCT No. T-5050 covering lot 3246 is hereby reinstated. On April 5, 1994, the Register of Deeds cancelled the annotation of notices of lis pendens.17 Feeling that a motion for reconsideration would be fruitless, petitioner filed the instant special civil action for certiorari, alleging that: THE HONORABLE RESPONDENT JUDGE ACTED CAPRICIOUSLY, WHIMSICALLY AND WITH GRAVE ABUSE OF DISCRETION IN ORDERING THE CANCELLATION OF THE NOTICES OF LIS PENDENS ANNOTATED AT THE BACK OF THE CERTIFICATES OF TITLE THAT ARE THE SUBJECT OF THE CIVIL CASE NO. 19408, AS THESE ARE AMONG THE DOCUMENTS THAT ARE SOUGHT TO BE DECLARED NULL AND VOID BY THE HEREIN PETITIONER. The doctrine of lis pendens is founded upon reasons of public policy and necessity, the purpose of which is to make known to the whole world that properties in litigation are still within the power of the court until the litigation is terminated and to prevent the defeat of the judgment or decree by subsequent alienation.18 The notice of lis pendens is an announcement to the whole world that a particular real property is in litigation, and serves as a warning that one who acquires an interest over said property does so at his own risk, or that he gambles on the result of the litigation over said property.19 Rule 13, Section 14 of the 1997 Rules of Civil Procedure 20 and Section 76 of Presidential Decree No. 1529, 21 otherwise known as the Property Registration Decree provide the statutory bases for notice of lis pendens. From these provisions, it is clear that such a notice is proper only in: a) An action to recover possession of real estate; b) An action to quiet title thereto; c) An action to remove clouds thereon; d) An action for partition; and e) Any other proceedings of any kind in Court directly affecting title to the land or the use or occupation thereof or the building thereon.22 Thus, all petitioner has to do is to assert a claim of possession or title over the subject property to put the property under the coverage of the rule.23 It is not necessary for her to prove ownership or interest over the property sought to be affected by lis pendens. Whether as a matter, of procedure24 or substance,25 the rule is that a notice of lis pendens may be cancelled only on two (2) grounds, namely (1) if the annotation was for the purpose of molesting the title of the adverse party, or (2) when the annotation is not necessary to protect the title of the party who caused it to be recorded.26 The petition should be dismissed, there being a clear violation of the doctrine of judicial hierarchy that we have taken pains to emphasize in past jurisprudence.

Thus, we ruled in Vergara v. Suelto27 that: [t]he Supreme Court is a court of last resort, and must so remain if its is to satisfactorily perform the functions assigned to it by fundamental charter and immemorial tradition. It cannot and should not be burdened with the task of dealing with causes in the first instance. Its original jurisdiction to issue the so-called extraordinary writs should be exercised only where absolutely necessary or where serious and important reasons exist therefor. Hence, that jurisdiction should generally be exercised relative to actions or proceedings before the Court of Appeals, or before constitutional or other tribunals, bodies or agencies whose acts for some reason or another, are not controllable by the Court of Appeals. Where the issuance of an extraordinary writ is also within the competence of the Court of Appeals or a Regional Trial Court, it is in either of these courts that the specific action for the writ's procurement must be presented. This is and should continue to be the policy in this regard, a policy that courts and lawyers must strictly observe. We reaffirmed this policy in People v. Cuaresma,28 thus: xxx A last word. This Court's original jurisdiction to issue writ of certiorari (as well as prohibition, mandamus, quo warranto, habeas corpus and injunction) is not exclusive. It is shared by this Court with Regional Trial Courts (formerly Courts of First Instance), which may issue the writ, enforceable in any part of their respective regions. It is also shared by this Court, and by the Regional Trial Court, with the Court of Appeals (formerly Intermediate Appellate Court), although prior to the effectivity of Batas Pambansa Bilang 129 on August 14, 1981, the latter's competence to issue the extraordinary writs was restricted to those "in aid of its appellate jurisdiction." This concurrence of jurisdiction is not, however, to be taken as according to parties seeking any of the writs an absolute, unrestrained freedom of choice of the court to which application therefor will be directed. There is after all a hierarchy of courts. That hierarchy is determinative of the venue of appeals, and should also serve as a general determinant of the appropriate forum for petitions for the extraordinary writs. A becoming regard for that judicial hierarchy most certainly indicates that petitions for the issuance of extraordinary writs against first level ("inferior") courts should be filed with the Regional Trial Court, and those against the latter, with the Court of Appeals. A direct invocation of the Supreme Court's original jurisdiction to issue these writs should be allowed only when there are special and important reasons therefor, clearly and specifically set out in the petition. This is established policy. It is a policy that is necessary to prevent inordinate demands upon the Court's time and attention which are better devoted to those matters within its exclusive jurisdiction, and to prevent further over-crowding of the Court's docket. Indeed, the removal of the restriction on the jurisdiction of the Court of Appeals in this regard, supra-resulting from the deletion of the qualifying phrase, "in aid of its appellate jurisdiction"-was evidently intended precisely to relieve this Court pro tanto of the burden of dealing with applications for the extraordinary writs which, but for the expansion of the Appellate Court's corresponding jurisdiction, would have had to be filed with it. The Court feels the need to reaffirm that policy at this time, and to enjoin strict adherence thereto in the light of what it perceives to be a growing tendency on the part of litigants and lawyers to have their applications for the so-called extraordinary writs, and sometimes even their appeals, passed upon and adjudicated directly and, immediately by the highest tribunal of the land. The proceeding at bar is a case in point. The application for the writ of certiorari sought against a City Court was brought directly to this Court although there is no discernible special and important reason for not presenting it to the Regional Trial Court. The Court therefore closes this decision with the declaration, for the information and guidance of all concerned, that it will not only continue to enforce the policy, but will require a more strict observance thereof. (emphasis supplied) Notwithstanding these pronouncements, parties persisted in disregarding the judicial hierarchy. As we noted in Santiago v. Vasquez,29

One final observation. We discern in the proceedings in this case a propensity on the part of petitioner, and, for that matter, the same may be said of a number of litigants who initiate recourses before us, to disregard the hierarchy of courts in our judicial system by seeking relief directly from this Court despite the fact that the same is available in the lower courts in the exercise of their original or concurrent jurisdiction, or is even mandated by law to be sought therein. This practice must be stopped, not only because of the imposition upon the precious time of this Court but also because of the inevitable and resultant delay, intended or otherwise, in the adjudication of the case which often has to be remanded or referred to the lower court as the proper forum under the rules of procedure, or as better equipped to resolve the issues since this Court is not a trier of facts. We, therefore, reiterate the judicial policy that this Court will not entertain direct resort to it unless the redress desired cannot be obtained in the appropriate courts or where exceptional and compelling circumstance justify availment of a remedy within and calling for the exercise of our primary jurisdiction. This policy found further application in People v. Court of Appeals,30 Aleria v. Velez, exceptional and compelling reasons justified a disregard of the rule. 33
31

and Tano v. Socrates.32 Only the presence of

Petitioner has failed to advance a satisfactory explanation as to her failure to comply with or non-observance of the principle of judicial hierarchy. There is no reason why the instant petition could not have been brought before the Court of Appeals, considering all the more that the appeal of the main case was already before it. In Magdalena, Homeowners Association, Inc. v. Court of Appeals34 we ruled, to wit: The notice of lis pendens-i.e., that real property is involved in an action-is ordinarily recorded without the intervention of the court where the action is pending. The notice is but an incident in an action, an extrajudicial one, to be sure. It does not affect the merits thereof. It is intended merely to constructively advise, or warn, all people who deal with the property that they so deal with it at their own risk, and whatever rights they may acquire in the property in any voluntary transaction are subject to the results of the action, and may well be inferior and subordinate to those which may be finally determined and laid down therein. The cancellation of such a precautionary notice is therefore also a mere incident in the action, and may be ordered by the Court having jurisdiction of it at any given time. And its continuance or removal-like the continuance or removal or removal of a preliminary attachment of injunction-is not contingent on the existence of a final judgment in the action, and ordinarily has no effect on the merits thereof.1wphi1 In the case at bar, the case had properly come within the appellate jurisdiction of the Court of Appeals in virtue of the perfection of the plaintiff's appeal. It therefore had power to deal with and resolve any incident in connection with the action subject of the appeal, even before final judgment. The rule that no questions may be raised for the first time on appeal have reference only to those affecting the merits of the action, and not to mere incidents thereof, e.g., cancellation of notices of lis pendens, or, to repeat, the grant or dissolution of provisional remedies. [emphasis supplied] Had petitioner brought the instant petition before the Court of Appeals, the same could, and would, have been consolidated with the appeal, thereby bringing under the competence of the said court all matters relative to the action, including the incidents thereof. Prescinding from the foregoing discussion, the disposition of the instant case will be incomplete without a reference to the improper and unethical language employed by respondent Jose B. Tiongco, who is also counsel for private respondents, in his pleadings and motions filed both before us and the court a quo. It is his belief that counsel for petitioner, Atty. Marciana Deguma, "a rambunctious wrestler-type female of 52 who does not wear a dress which is not red, and who stampedes into the courtroom like a mad fury and who speaks slang English to conceal her faulty grammar,"35 is impelled by less than less than noble reasons in serving as counsel for petitioner. Her ulterior motive? "[T]o please and tenderize and sweeten towards her own self the readily available Carmelo M. Tiongco," 36 a retired police major described by respondent Tiongco as Atty. Deguma's "nio bonito,"37 an unmarried mestizo with curly hair who lives with plaintiff for being houseless" 38 who rents a place on the subject property sought to be recovered by petitioner. Atty. Deguma, apparently are unmarried maiden of a certain age,

is variously described by respondent Tiongco as "a love-crazed female Apache [who] is now ready to skin defendant alive for not being a bastard,"39 and a "horned spinster and man-hungry virago and female bull of an Amazon who would stop at nothing to molest, harrass (sic) and injure defendant - if only to please and attract police-major Carmelo Tiongco Junior - the deeply desired object of her unreciprocated affections - who happens not to miss every chance to laugh at her behind her back." 40 He claims that Atty. Deguma, a lawyer with the Public Attorney's Office, is engaged in a game of one-upmanship with a fellow employee, in that "she happens to be ambitious enough to secretly (that what she thought) plot to put one over her office-mate who simply netted a corporal (if not a private) by aiming at no lest than an IMDC major - hoping to catch him by sheer brass and audacity."41 In so doing, Atty. Deguma is using the PAO as a "marriage bureau for her own benefit.42 Respondent Tiongco predicts that nothing good will come out of opposing counsel's scheme since, quoting Voltaire, "outside of virtue, ther's (sic) no happiness."431wphi1 Respondent Tiongco has achieved a remarkable feat of character assassination. His verbal darts, albeit entertaining in a fleeting way, are cast with little regard for truth. However, he does nothing more than to obscure the issues, and his reliance on the fool's gold of gossip betrays only a shocking absence of discernment. To this end, it will be wise to give him an object lesson in the elementary rules of courtesy by which we expect members of the bar to comport themselves. These provisions of the Code of Professional Responsibility are pertinent: CANON 8-A LAWYER SHALL CONDUCT HIMSELF WITH COURTESY, FAIRNESS AND CANDOR TOWARD HIS PROFESSIONAL COLLEAGUES, AND SHALL AVOID HARASSING TACTICS AGAINST OPPOSING COUNSEL. Rule 8.01-A lawyer shall not, in his professional dealings, use languages which is abusive, offensive or otherwise improper. xxx xxx xxx

Rule 11.03-A lawyer shall abstain from scandalous, offensive or menacing language before the courts. In Romero v. Valle,44 we stated that a lawyer's actuations, "[a]lthough allowed some latitude of remarks or comment in the furtherance of the cause he upholds, his arguments, both written or oral, should be gracious to both court and opposing counsel and be of such words as may be properly addressed by one gentleman to another." Otherwise, his use of intemperate language invites the disciplinary authority of the court.45 We are aghast at the facility with which respondent Atty. Jose B. Tiongco concocts accusations against the opposing party and her counsel, although it is of public record that in Tiongco v. Deguma, et a1.,46 we dismissed as totally unfounded his charge of fraudulent conspiracy and public scandal against petitioner, Major Tiongco, Atty. Deguma and even the latter's superior at the Public Attorney's Office, Atty. Napoleon G. Pagtanac. His lexicon of insults, though entertaining, do not find a ready audience in us, and he should be, as he is hereby, warned accordingly: Homines qui gestant, quiqui auscultant crimina, si meo arbitratu liceat, omnis pendeat, gestores linguis, auditores auribus.47 WHEREFORE, the petition fir certiorari is hereby DISMISSED, without pronouncement as to costs. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION A.C. No. 5768 ATTY. BONIFACIO T. BARANDON, JR., Complainant, vs. ATTY. EDWIN Z. FERRER, SR., Respondent. DECISION ABAD, J.: This administrative case concerns a lawyer who is claimed to have hurled invectives upon another lawyer and filed a baseless suit against him. The Facts and the Case On January 11, 2001 complainant Atty. Bonifacio T. Barandon, Jr. filed a complaint-affidavit1 with the Integrated Bar of the Philippines Commission on Bar Discipline (IBP-CBD) seeking the disbarment, suspension from the practice of law, or imposition of appropriate disciplinary action against respondent Atty. Edwin Z. Ferrer, Sr. for the following offenses: 1. On November 22, 2000 Atty. Ferrer, as plaintiffs counsel in Civil Case 7040, filed a reply with opposition to motion to d ismiss that contained abusive, offensive, and improper language which insinuated that Atty. Barandon presented a falsified document in court. 2. Atty. Ferrer filed a fabricated charge against Atty. Barandon in Civil Case 7040 for alleged falsification of public document when the document allegedly falsified was a notarized document executed on February 23, 1994, at a date when Atty. Barandon was not yet a lawyer nor was assigned in Camarines Norte. The latter was not even a signatory to the document. 3. On December 19, 2000, at the courtroom of Municipal Trial Court (MTC) Daet before the start of hearing, Atty. Ferrer, evidently drunk, threatened Atty. Barandon saying, "Laban kung laban, patayan kung patayan, kasama ang lahat ng pamilya. Wala na palang magaling na abogado sa Camarines Norte, ang abogado na rito ay mga taga-Camarines Sur, umuwi na kayo sa Camarines Sur, hindi kayo taga-rito." 4. Atty. Ferrer made his accusation of falsification of public document without bothering to check the copy with the Office of the Clerk of Court and, with gross ignorance of the law, failed to consider that a notarized document is presumed to be genuine and authentic until proven otherwise. March 26, 2010

5. The Court had warned Atty. Ferrer in his first disbarment case against repeating his unethical act; yet he faces a disbarment charge for sexual harassment of an office secretary of the IBP Chapter in Camarines Norte; a related criminal case for acts of lasciviousness; and criminal cases for libel and grave threats that Atty. Barandon filed against him. In October 2000, Atty. Ferrer asked Atty. Barandon to falsify the daily time record of his son who worked with the Commission on Settlement of Land Problems, Department of Justice. When Atty. Barandon declined, Atty. Ferrer repeatedly harassed him with inflammatory language. Atty. Ferrer raised the following defenses in his answer with motion to dismiss: 1. Instead of having the alleged forged document submitted for examination, Atty. Barandon filed charges of libel and grave threats against him. These charges came about because Atty. Ferrers client s filed a case for falsification of public document against Atty. Barandon. 2. The offended party in the falsification case, Imelda Palatolon, vouchsafed that her thumbmark in the waiver document had been falsified. 3. At the time Atty. Ferrer allegedly uttered the threatening remarks against Atty. Barandon, the MTC Daet was already in session. It was improbable that the court did not take steps to stop, admonish, or cite Atty. Ferrer in direct contempt for his behavior. 4. Atty. Barandon presented no evidence in support of his allegations that Atty. Ferrer was drunk on December 19, 2000 and that he degraded the law profession. The latter had received various citations that speak well of his character. 5. The cases of libel and grave threats that Atty. Barandon filed against Atty. Ferrer were still pending. Their mere filing did not make the latter guilty of the charges. Atty. Barandon was forum shopping when he filed this disbarment case since it referred to the same libel and grave threats subject of the criminal cases. In his reply affidavit,2 Atty. Barandon brought up a sixth ground for disbarment. He alleged that on December 29, 2000 at about 1:30 p.m., while Atty. Ferrer was on board his sons taxi, it figured in a collision with a tricycle, resulting in serious injuries to the tricycles passengers.3 But neither Atty. Ferrer nor any of his co-passengers helped the victims and, during the police investigation, he denied knowing the taxi driver and blamed the tricycle driver for being drunk. Atty. Ferrer also prevented an eyewitness from reporting the accident to the authorities.4 Atty. Barandon claimed that the falsification case against him had already been dismissed. He belittled the citations Atty. Ferrer allegedly received. On the contrary, in its Resolution 00-1,5 the IBP-Camarines Norte Chapter opposed his application to serve as judge of the MTC of Mercedes, Camarines Sur, on the ground that he did not have "the qualifications, integrity, intelligence, industry and character of a trial judge" and that he was facing a criminal charge for acts of lasciviousness and a disbarment case filed by an employee of the same IBP chapter. On October 10, 2001 Investigating Commissioner Milagros V. San Juan of the IBP-CBD submitted to this Court a Report, recommending the suspension for two years of Atty. Ferrer. The Investigating Commissioner found enough evide nce on record to prove Atty. Ferrers violation of Canons 8.01 and 7.03 of the Code of Professional Responsibility. He attributed to Atty. Barandon, as counsel in Civil Case 7040, the falsification of the plaintiffs affidavit despite the absence of eviden ce that the document had in fact been falsified and that Atty. Barandon was a party to it. The Investigating Commissioner also found that Atty. Ferrer uttered the threatening remarks imputed to him in the presence of other counsels, court personnel, and litigants before the start of hearing.

On June 29, 2002 the IBP Board of Governors passed Resolution XV-2002-225,6 adopting and approving the Investigating Commissi oners recommendation but reduced the penalty of suspension to only one year. Atty. Ferrer filed a motion for reconsideration but the Board denied it in its Resolution 7 of October 19, 2002 on the ground that it had already endorsed the matter to the Supreme Court. On February 5, 2003, however, the Court referred back the case to the IBP for resolution of Atty. Ferrers motion for reconsideration.8 On May 22, 2008 the IBP Board of Governors adopted and approved the Report and Recommendation 9 of the Investigating Commissioner that denied Atty. Ferrers motion for reconsideration. 10 On February 17, 2009, Atty. Ferrer filed a Comment on Board of Governors IBP Notice of Resolution No. XVIII-2008.11 On August 12, 2009 the Court resolved to treat Atty. Ferrers comment as a petition for re view under Rule 139 of the Revised Rules of Court. Atty. Barandon filed his comment,12 reiterating his arguments before the IBP. Further, he presented certified copies of orders issued by courts in Camarines Norte that warned Atty. Ferrer against appearing in court drunk.13 The Issues Presented The issues presented in this case are: 1. Whether or not the IBP Board of Governors and the IBP Investigating Commissioner erred in finding respondent Atty. Ferrer guilty of the charges against him; and 2. If in the affirmative, whether or not the penalty imposed on him is justified.

The Courts Ruling We have examined the records of this case and find no reason to disagree with the findings and recommendation of the IBP Board of Governors and the Investigating Commissioner. The practice of law is a privilege given to lawyers who meet the high standards of legal proficiency and morality. Any violation of these standards exposes the lawyer to administrative liability.14 Canon 8 of the Code of Professional Responsibility commands all lawyers to conduct themselves with courtesy, fairness and candor towards their fellow lawyers and avoid harassing tactics against opposing counsel. Specifically, in Rule 8.01, the Code provides: Rule 8.01. A lawyer shall not, in his professional dealings, use language which is abusive, offensive or otherwise improper. Atty. Ferrers actions do not measure up to this Canon. The evidence shows that he imputed to Atty. Barandon the falsificatio n of the Salaysay Affidavit of the plaintiff in Civil Case 7040. He made this imputation with pure malice for he had no evidence that the affidavit had been falsified and that Atty. Barandon authored the same.

Moreover, Atty. Ferrer could have aired his charge of falsification in a proper forum and without using offensive and abusive language against a fellow lawyer. To quote portions of what he said in his reply with motion to dismiss: 1. That the answer is fraught with grave and culpable misrepresentation and "FALSIFICATION" of documents, committed to mislead this Honorable Court, but with concomitant grave responsibility of counsel for Defendants, for distortion and serious misrepresentation to the court, for presenting a grossly "FALSIFIED" document, in violation of his oath of office as a government employee and as member of the Bar, for the reason, that, Plaintiff, IMELDA PALATOLON, has never executed the "SALAYSAY AFFIDAVIT", wherein her fingerprint has been falsified, in view whereof, hereby DENY the same including the affirmative defenses, there being no knowledge or information to form a belief as to the truth of the same, from pars. (1) to par. (15) which are all lies and mere fabrications, sufficient ground for "DISBARMENT" of the one responsible for said falsification and distortions."15 The Court has constantly reminded lawyers to use dignified language in their pleadings despite the adversarial nature of our legal system.16 Atty. Ferrer had likewise violated Canon 7 of the Code of Professional Responsibility which enjoins lawyers to uphold the dignity and integrity of the legal profession at all times. Rule 7.03 of the Code provides: Rule 7.03. A lawyer shall not engage in conduct that adversely reflect on his fitness to practice law, nor shall he, whether in public or private life behave in scandalous manner to the discredit of the legal profession. Several disinterested persons confirmed Atty. Ferrers drunken invectives at Atty. Barandon shortly before the start of a cou rt hearing. Atty. Ferrer did not present convincing evidence to support his denial of this particular charge. He merely presented a certification from the police that its blotter for the day did not report the threat he supposedly made. Atty. Barandon presented, however, the police blotter on a subsequent date that recorded his complaint against Atty. Ferrer. Atty. Ferrer said, "Laban kung laban, patayan kung patayan, kasama ang lahat ng pamilya. Wala na palang magaling na abogado sa Camarines Norte, ang abogado na rito ay mga taga-Camarines Sur, umuwi na kayo sa Camarines Sur, hindi kayo taga-rito." Evidently, he uttered these with intent to annoy, humiliate, incriminate, and discredit Atty. Barandon in the presence of lawyers, court personnel, and litigants waiting for the start of hearing in court. These language is unbecoming a member of the legal profession. The Court cannot countenance it. Though a lawyers language may be forceful and emphatic, it should always be dignified and respectful, befitting the dignity of the legal profession. The use of intemperate language and unkind ascriptions has no place in the dignity of judicial forum.17 Atty. Ferrer ought to have realized that this sort of public behavior can only bring down the legal profession in the public estimation and erode public respect for it. Whatever moral righteousness Atty. Ferrer had was negated by the way he chose to express his indignation. 1avvphi1 Contrary to Atty. Ferrers allegation, the Court finds that he has been accorded due process. The ess ence of due process is to be found in the reasonable opportunity to be heard and submit any evidence one may have in support of ones defense. 18 So long as the parties are given the opportunity to explain their side, the requirements of due process are satisfactorily complied with. 19 Here, the IBP Investigating Commissioner gave Atty. Ferrer all the opportunities to file countless pleadings and refute all the allegations of Atty. Barandon. All lawyers should take heed that they are licensed officers of the courts who are mandated to maintain the dignity of the legal profession, hence they must conduct themselves honorably and fairly.20 Atty. Ferrers display of improper attitude, arrogance, misbehavior, and

misconduct in the performance of his duties both as a lawyer and officer of the court, before the public and the court, was a patent transgression of the very ethics that lawyers are sworn to uphold. ACCORDINGLY, the Court AFFIRMS the May 22, 2008 Resolution of the IBP Board of Governors in CBD Case 01-809 and ORDERS the suspension of Atty. Edwin Z. Ferrer, Sr. from the practice of law for one year effective upon his receipt of this Decision. Let a copy of this Decision be entered in Atty. Ferrers personal rec ord as an attorney with the Office of the Bar Confidant and a copy of the same be served to the IBP and to the Office of the Court Administrator for circulation to all the courts in the land. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila FIRST DIVISION G.R. No. 160604 March 28, 2008

PHILIPPINE DAILY INQUIRER, ISAGANI YAMBOT, LETTY JIMENEZ-MAGSANOC, PERGENITO B. BANDAYREL, JR., GOBLETH C. MOULIC, ESTANISLAO CALDEZ, and ZENAIDA CALDEZ, Petitioners, vs. HON. ELMO M. ALAMEDA, in his capacity as the Presiding Judge of the REGIONAL TRIAL COURT OF TUGUEGARAO CITY, CAGAYAN, BRANCH 5, and LUZ CORTEZ BABARAN, Respondents. DECISION AZCUNA, J.: Before us is a petition for review on certiorari seeking the review, setting aside, and annulment of the Resolution1 of the Court of Appeals (CA) in CA-G.R. SP No. 79702 dated October 22, 2003 dismissing the petition for certiorari and prohibition filed by petitioners. The antecedents are as follows: The Philippine Daily Inquirer (PDI), in its August 1, 2000 issue, published an article with the heading "After Bong, whos ne xt?"2 The article narrates the death of Expedito "Bong" Caldez, a photo correspondent of the PDI in Cagayan. In said article, the family of the deceased correspondent laments the death of their loved one due to the alleged erroneous diagnosis of Dr. Luz Babaran.3 Later, in its September 29, 2000 issue, the PDI published another article with the heading "DOH orders probe of fotogs death ."4 In said article, it was reported that the regional Department of Health (DOH) in Tuguegarao City has started investigating the death of Expedito Caldez following an order from the DOHs Bureau of Licensing and Regulation. On July 25, 2001, based on the two PDI column articles, Dr. Babaran filed a complaint for Damages, 5 Civil Case No. 5850, against herein petitioners. In said complaint Dr. Babaran alleged, among other things, that: after learning about the article published in the August 1, 2000 issue of the PDI, she wrote a letter to the editor of the PDI but she never received any response from the latter; to aggravate the matter, another article appeared in the September 29, 2000 issue of the PDI and she was again singled out as having erroneously diagnosed the illness of Expedito Caldez; the Report 6 of the DOH Fact-Finding Committee concluding that her diagnosis cannot be considered erroneous, was suppressed and was never published by the PDI; the articles portrayed her as incompetent and one whose alleged erroneous diagnosis caused the death of Expedito Caldez; and, in causing the articles to be published, petitioners acted in bad faith. On September 13, 2001, petitioners filed their Answer 7 with counterclaims. In said answer, petitioners raised, among others, the following defenses: that the complaint states no cause of action against them; that the complaint fails and omits to state the factual premises to support a conclusion that there was malice on the part of the PDI in publishing the questioned news report; that private respondent failed to

allege "actual malice" on the part of the petitioners; that a case for actionable libel with claims for damages has not been adequately stated in the complaint; and, that the complaint fails to establish the basis of petitioners liability. 8 Pre-trial was held and terminated, and petitioners thereafter filed a Motion for a Preliminary Hearing on Affirmative Defense Raised in the Answer (which is also a ground for a motion to dismiss). 9 In said motion, it was alleged that at the pre-trial on February 19, 2003, the court noted that one of the defenses raised by petitioners was that private respondent has not delineated the participation of each of petitioners in the publication of the alleged libelous articles.10 Thereupon, private respondents counsel asked for a few days to determine whether the complaint should be amended to cure its defects. However, private respondent had not moved to amend the complaint, hence, petitioners filed the motion.11 In support thereof, petitioners contend that: in libel charges, the participation of each defendant must be specifically alleged in the complaint, which private respondent failed to do; and the allegations of the complaint are mere conclusions of law and opinions of the private respondent.12 Petitioners ultimately prayed that a preliminary hearing be conducted on their affirmative defense that the complaint failed to state a cause of action; and that, thereafter, the complaint be dismissed. 13 Subsequently, private respondent filed a Comment/Opposition to the Motion to Dismiss Based on Affirmative Defense. 14 In said comment/opposition, private respondent averred that at the February 19, 2003 pre-trial, the issue of whether or not the complaint states a cause of action was not raised. As such, it is no longer an issue to be litigated in the case. Private respondent prayed that the court deny petitioners motion to dismiss. On May 30, 2003, the Regional Trial Court (RTC) issued an Order15 denying petitioners motion in this wise: With this finding and conclusion, the Court finds no further necessity in dwelling at length on the other issues raised by the defendants. Consequently, the motion for a Preliminary Hearing on Affirmative Defense Raised in the Answer (which is also a ground for a motion to dismiss) is hereby DENIED. The initial presentation of plaintiffs evidence is set on July 3, 2003, at 8:30 oclock in the mo rning. SO ORDERED.16 The RTC opined that private respondents allegations in her complaint, as well as her documentary evidence, show that there i s sufficient cause of action. It added that the documentary evidence discloses facts which are sufficient to enable the court to go beyond the disclosures in the complaint. Considering that the facts alleged in the complaint which make out the principal cause of action and relief are sufficient, the case should not be dismissed.17 Petitioners filed a Motion for Reconsideration18 but it was denied in the Order19 dated July 29, 2003. Aggrieved, petitioners filed a Petition for Certiorari and Prohibition (with Prayer for the Issuance of Temporary Restraining Order and/or Preliminary Injunction)20 with the CA, relying on the ground that: THE RESPONDENT TRIAL JUDGE GRAVELY ABUSED HIS DISCRETION AND EXCEEDED HIS JURISDICTION IN NOT DISMISSING THE COMPLAINT DESPITE ITS FAILURE TO VALIDLY AND SUFFICIENTLY STATE A CAUSE OF ACTION FOR LIBEL AGAINST THE PETITIONERS BECAUSE:

A) THE PARTICIPATION OF EACH DEFENDANT (PETITIONER) IN THE WRITING, EDITING, PRINTING, AND PUBLICATION OF THE NEWS ARTICLES IN QUESTION IS NOT SPECIFICALLY SET OUT IN THE COMPLAINT; B) THE MATERIAL ALLEGATIONS OF THE COMPLAINT ARE PURELY LEGAL CONCLUSIONS AND OPINIONS OF PRIVATE RESPONDENT, AND NOT STATEMENTS OF ULTIMATE FACTS.21 Petitioners prayed among others: that the Orders of the RTC dated May 30, 2003 and July 29, 2003 be annulled and set aside for having been rendered with grave abuse of discretion and/or excess of jurisdiction; and that Civil Case No. 5850 be dismissed for failure to state a cause of action.22 On October 22, 2003, the CA issued a Resolution23 dismissing the petition for being insufficient in form and substance and for presenting no justiciable issue needing serious consideration by the court. Also, the CA noted that the Order dated May 30, 2003 shows that the RTC had already ruled against petitioners affirmative defense that the complaint states no cause of action. Hence, this petition, raising the following issues: WHETHER OR NOT A COMPLAINT WHICH FAILS TO VALIDLY AND SUFFICIENTLY STATE A CAUSE OF ACTION FOR LIBEL BECAUSE: A) THE PARTICIPATION OF EACH DEFENDANT (PETITIONER) IN THE WRITING, EDITING, PRINTING, AND PUBLICATION OF THE NEWS ARTICLES IN QUESTION IS NOT SPECIFICALLY SET OUT IN THE COMPLAINT; B) THE MATERIAL ALLEGATIONS OF THE COMPLAINT ARE PURELY LEGAL CONCLUSIONS AND OPINIONS OF PRIVATE RESPONDENT, AND NOT STATEMENTS OF ULTIMATE FACTS; AND C) THE COMPLAINT IS VIOLATIVE OF PETITIONERS CONSTITUTIONAL RIGHTS TO FREE PRESS AND TO FREE SPEECH. SHOULD BE DISMISSED UPON MOTION BY THE DEFENDANTS (PETITIONERS HEREIN).
24

Petitioners argue that private respondents complaint failed to comply with the requirement in libel cases that the participa tion of each defendant must be specifically alleged in the complaint. Petitioners maintain that their divergent personal circumstances and different legal existence, not to mention the absence of any professional relationship of two of petitioners with the rest of them, should have prompted private respondent to specify the participation of each petitioner in the news gathering, reporting, editing, publication, and circulation of the subject articles. As such it cannot be determined with certainty from the allegations in the complaint whose acts and omissions are actually complained of.25 Also, petitioners added that the material allegations of the complaint are not statements of ultimate facts but were mere conclusions of law and were merely private respondents opinions.26 Finally, petitioners contend that the complaint violates their constitutionally protected freedom of speech and of the press.27 As defined in Section 2, Rule 2 of the Rules of Court, a cause of action is the act or omission by which a party violates the right of another. In relation to a complaint, it is a formal statement of the operative facts that give rise to a remedial right. The question of whether the complaint

states a cause of action is determined by its averments regarding the acts committed by the defendant. Thus, it must contain a concise statement of the ultimate or essential facts constituting the plaintiff's cause of action. As such, the failure to make a sufficient allegation of a cause of action in the complaint warrants its dismissal.28 Its essential elements are as follows: 1. A right in favor of the plaintiff by whatever means and under whatever law it arises or is created; 2. An obligation on the part of the named defendant to respect or not to violate such right; and 3. Act or omission on the part of such defendant in violation of the right of the plaintiff or constituting a breach of the obligation of the defendant to the plaintiff for which the latter may maintain an action for recovery of damages or other appropriate relief. Of the three, the most important is the last element since it is only upon the occurrence of the last element that a cause of action arises, giving the plaintiff the right to maintain an action in court for recovery of damages or other appropriate relief. 29 In determining whether an initiatory pleading states a cause of action, "the test is as follows: admitting the truth of the facts alleged, can the court render a valid judgment in accordance with the prayer?" To be taken into account are only the material allegations in the complaint; extraneous facts and circumstances or other matters aliunde are not considered. The court may however consider, in addition to the complaint, the appended annexes or documents, other pleadings of the plaintiff, or admissions in the records. 30 When a defendant seeks the dismissal of the complaint through a motion to dismiss, the sufficiency of the motion should be tested on the strength of the allegations of facts contained in the complaint and on no other basis.31 The issue of whether or not the complaint failed to state a cause of action, warranting its dismissal, must be passed upon on the basis of the allegations stated therein assuming them to be true and the court cannot inquire into the truth of the allegations and declare them to be false; otherwise, it would be a procedural error and a denial of due process to the plaintiff.32 This Court finds that petitioners raised the threshold question of whether the complaint sufficiently alleges a cause of action.1avvphi1 Hence, the trial court should have granted petition ers motion for a preliminary hearing on the affirmative defenses raised in the answer based on failure to state a cause of action. This procedure is designed to prevent a tedious, if not traumatic, trial in case the complaint falls short of sufficiently alleging a cause of action. WHEREFORE, the petition is GRANTED. The Resolution of the Court of Appeals dated October 22, 2003 is REVERSED, and the case is REMANDED to the Regional Trial Court of Tuguegarao City, Cagayan, Branch 5, for the trial court to hea r and resolve petitioners Affirmative Defenses Raised in the Answer. No costs. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila THIRD DIVISION G.R. No. 167181 SPS. CARLOS MUNSALUD and WINNIE MUNSALUD, petitioners, vs. NATIONAL HOUSING AUTHORITY, respondent. DECISION REYES, R.T., J.: INSUFFICIENCY in form and substance, as a ground for dismissal of the complaint, should not be based on the title or caption, especially when the allegations of the pleading support an action. In pursuit of a reversal of the Decision1 of the Court of Appeals (CA) affirming the order of dismissal 2 of the Regional Trial Court (RTC) in a complaint for mandamus,3 petitioners-spouses Carlos Munsalud and Winnie Munsalud lodged before this Court a petition for review on certiorari. The Facts Laid bare from the records are the following facts: Petitioner Winnie Munsalud is the daughter and one of the compulsory heirs of the late Lourdes Bulado (Bulado) who died on December 8, 1985. During the lifetime of Bulado, respondent National Housing Authority (NHA) awarded her a lot located at 942 R. Higgins St., CAA Compound, Bgy. 185, Pasay City. The award was made pursuant to the "Land for the Landless" program of respondent. She resided at the said property until her death. When Bulado died, petitioner Winnie assumed the obligation to pay the monthly amortizations. Respondent NHA recognized petitioner spouses assumption of obligations as their names were reflected in the receipts. They were allowed to occupy the lot up to the present. To prove their occupancy over the lot, petitioners offered as evidence the following documents, viz.: 1. Tag Card No. 77-02830-03 issued by then Pasay City Mayor Pablo Cuneta and then NHA General Manager Gaudencio Tobias; 2. Application and Contract for Water Services No. 295319 in the name of Bulado but the same was signed by petitioner Winnie; 3. Tax Declaration No. B-007-27566 over the land issued by the Assessors Office of Pasay City in the name of defendant recognizing its beneficial use in favor of petitioners; December 23, 2008

4. Tax Declaration No. B-007-27667 over the residential structure erected on the land and issued by the Assessors Office of Pasay City in the names of petitioners; 5. Pagpapatunay dated September 5, 1989 signed by neighbors and acquaintances of petitioners attesting to their long time residence in the property; 6. Deposit Receipt No. 286444 dated September 27, 1989 issued by the Manila Electric Company attesting to the installation of electric service in the name of petitioner Winnie on the property.4 On September 14, 1989, petitioners completed the payments of the amortizations due on the property. Reflected on the left side portion of the official receipt evidencing full payment is the annotation "full payment." Consequently, petitioners demanded that respondent NHA issue in their favor a deed of sale and a title over the property. Respondent, however, refused. On January 28, 2003, petitioners, by counsel, sent respondent a letter to issue a deed of sale and title. Despite receipt, respondent did not issue the requested documents. On March 6, 2003, respondent wrote pet itioners informing them that petitioner Winnies name does not appear as beneficiary. Petitioners replied that Winnie was representing her mother, the late Lourdes Bulado. Respondent did not respond to the reply. Left with no recourse, petitioners instituted a complaint for mandamus before the court a quo. RTC Order On April 22, 2003, the RTC dismissed the complaint for mandamus, disposing thus: Considering that the petition is insufficient in form and substance, there being no reference to any law which the respondent by reason of its office, trust or station is especially enjoined as a duty to perform or any allegation that respondent is unlawfully excluding petitioners from using or enjoying any right or office which said petitioners are entitled to, the above-entitled petition is hereby DISMISSED, pursuant to Section 3 Rule 65 of the 1997 Rules of Civil Procedure. SO ORDERED.5 Petitioners moved for reconsideration but they did not succeed. Thus, petitioners seasonably appealed to the CA. CA Disposition On August 23, 2004, the CA affirmed the RTC dismissal of the mandamus petition. WHEREFORE, the instant appeal is hereby DISMISSED. Accordingly, the assailed Order of Dismissal is AFFIRMED. SO ORDERED.6 In agreeing with the court a quo, the appellate court rationalized as follows:

It is essential to the issuance of the writ of mandamus that the petitioner should have a clear legal right to the thing demanded and it must be the imperative duty of the respondent to perform the act required. It is a command to exercise a power already possessed and to perform a duty already imposed. It well settled that the legal right of petitioner to the performance of the particular act which is sought to be compelled must be clear and complete. A clear legal right within the meaning of the rule means a right which is clearly founded in, or granted by law; a right which is inferable as a matter of law. Likewise, mandamus refers only to acts enjoined by law to be done. The duties to be enforced must be such as are clearly peremptorily enjoined by law or by reason of official station. However, appellants failed to point out in their petition the specific law by which defendant is duty bound to perform the act sought to be performed, as well as the law which would grant them the clear legal right to the issuance of the writ of mandamus. Foregoing discussed, we find no error on the part of the court a quo in dismissing the petition for mandamus filed by plaintiffsappellants. On September 20, 2004, petitioners moved for reconsideration but it was denied by the CA on February 22, 2005. Hence, the present recourse. Issues I. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN AFFIRMING THE ORDERS OF THE HONORABLE REGIONAL TRIAL COURT OF QUEZON CITY DATED APRIL 22, 2003 AND SEPTEMBER 25, 2003 WHERE THE LATTER COURT RELYING UPON THE APPELLATION AND/OR LABEL THAT PETITIONERS GAVE THEIR COMPLAINT (I.E., MANDAMUS) IN CIVIL CASE NO. Q-03-492 DISMISSED THE COMPLAINT THEREIN PURPORTEDLY BECAUSE THE SAID COMPLAINT FAILED TO COMPLY WITH SECTION 3, RULE 65 OF THE 1997 RULES OF CIVIL PROCEDURE. II. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN DENYING PETITIONERS MOTION FOR RECONSIDERATION OF ITS DECISION DATED AUGUST 23, 2004.7 (Underscoring supplied) Poring over the arguments presented, the focal issue is whether in giving due course to an action, the court is fenced within the parameters of the title given by plaintiff to the case without regard to the averments of the pleading. Elsewise stated, does the trial court have absolute discretion to dismiss an action on the ground that it is insufficient in form and substance based alone on its designation when, from the body and the relief prayed for, it could stand as an action sufficient in form and substance? Our Ruling Petitioners action designated as mandamus was dismissed by the trial court on the ground that it is insufficient in form and substance. This begs the question: when is an action sufficient in form and when is it sufficient in substance?

To begin with, form is the methodology used to express rules of practice and procedure. 8 It is the order or method of legal proceedings.9 It relates to technical details.10 It is ordinarily the antithesis of substance. 11 It is an established method of expression or practice. It is a fixed or formal way of proceeding.12 A pleading is sufficient in form when it contains the following: 1. A Caption, setting forth the name of the court, the title of the action indicating the names of the parties, and the docket number which is usually left in blank, as the Clerk of Court has to assign yet a docket number; 2. The Body, reflecting the designation, the allegations of the partys claims or defenses, the relief prayed for, and the date of the pleading; 3. The Signature and Address of the party or counsel;13 4. Verification. This is required to secure an assurance that the allegations have been made in good faith, or are true and correct and not merely speculative;14 5. A Certificate of Non-forum Shopping, which although not jurisdictional, the same is obligatory;15 6. An Explanation in case the pleading is not filed personally to the Court. Likewise, for pleading subsequent to the complaint, if the same is not served personally to the parties affected, there must also be an explanation why service was not done personally. 16 Likewise, for all other pleadings, not initiatory in nature, there must be: A Proof of Service, which consists in the written admission of the party served, or the official return of the server, or the affidavit of the party serving, containing a full statement of the date, place and manner of service. If the service is by ordinary mail, proof thereof shall consist of an affidavit of the person mailing. If service is by registered mail, proof shall be made by such affidavit and the registry receipt issued by the mailing office.17 In case a party is represented by counsel de parte, additional requirements that go into the form of the pleading should be incorporated, viz.: 1. The Roll of Attorneys Number; 2. The Current Professional Tax Receipt Number; and 3. The IBP Official Receipt No. or IBP Lifetime Membership Number.18 4. MCLE Compliance or Exemption Certificate Number and Date of Issue (effective January 1, 2009). 19 In the case at bench, a naked perusal of the complaint docketed as Civil Case No. Q03- 49278 designated by petitioners as mandamus reveals that it is sufficient in form. It has the caption with the name of the court, the name of the parties, and the docket number. The complaint contains allegations of petitioners claims. It has a prayer and the date when it was prepared. The signature page shows the

signature and name of petitioners counsel, the counsels IBP, PTR and Roll of Attorneys Numbers. The complaint was also verified and accompanied by a certificate of non-forum shopping and signed by petitioners as plaintiffs. It was filed personally with the office of the clerk of court. Now, is the petition insufficient in substance? Substance is that which is essential and is used in opposition to form. 20 It is the most important element in any existence, the characteristic and essential components of anything, the main part, the essential import, and the purport. 21 It means not merely subject of act, but an intelligible abstract or synopsis of its material and substantial elements, though it may be stated without recital of any details. 22 It goes into matters which do not sufficiently appear or prejudicially affect the substantial rights of parties who may be interested therein and not to mere informalities.23 As used in reference to substance of common-law actions, substance comprehends all of the essential or material elements necessary to sufficiently state a good cause of action invulnerable to attack by general demurrer. 24 Substance is one which relates to the material allegations in the pleading. It is determinative of whether or not a cause of action exists. It is the central piece, the core, and the heart constituting the controversy addressed to the court for its consideration. It is the embodiment of the essential facts necessary to confer jurisdiction upon the court. The court a quo anchored the dismissal of petitioners complaint on the basis of Rule 65, Section 3 25 of the 1997 Rules of Civil Procedure. It found that there was no reference to any law which respondent NHA, by reason of its office, trust or station, is specifically enjoined as a duty to perform. It declared that there was no allegation in the petition below that respondent is unlawfully excluding petitioners from using or enjoying any right or office which said petitioners are entitled to. Although the complaint was captioned as Mandamus, petitioners averments, as well as the relief sought, called for an action for specific performance. Pertinent portions of the complaint for mandamus provide: 3. Plaintiff Winnie Munsalud is the daughter of the late Lourdes Bulado, and as such is one of Bulados compulsory heirs. x x x; 4. During the lifetime of Bulado, she was awarded a parcel of land at a "land for the landless" program of the defendant; xxxx 6. When Bulado died in 1985, Plaintiffs assumed her obligations over the aforesaid property, particularly the payment of the amortizations therein; 7. Defendant recognized this assumption of Bulados obligations by the Plaintiffs considering that in the receipts covering the amortizations, the names of the Plaintiffs as the ones paying the Defendant were indicated therein; 8. In fact, Defendant also allowed Plaintiffs to move into, and occupy, as they continue to occupy up to now, the above described premises;

xxxx 10. On September 14, 1989, Plaintiffs completed the payment of the amortizations due over the property in question, and this is evidenced by an official receipt, numbered 19492, which Defendants cashier, Yasmin D. Aquino, issued to the Plaintiffs themselves, although the official name of the payor indicated therein was still that of the deceased Lourdes Bulado; xxxx 12. Significantly, that receipt contained the annotation appearing on the left side thereof, that the amount paid thereon constituted "full payment"; 13. Since then, Plaintiffs have been demanding from the Defendant the issuance of the deed of sale and the title over the property in question, but, inexplicably, and without any legal justification whatsoever, Defendant has refused to issue that deed of sale and title; 14. On January 28, 2003, Plaintiffs, through counsel, sent a letter to the Defendant seeking the issuance of that deed of sale and title but, despite receipt thereof, Defendant again refused and failed [to] act favorably thereon ; xxxx 20. At this point that the lot in question had already been fully paid for by the Plaintiffs, there is now a need to compel the Defendant to comply with its duty to issue a deed of sale in favor of the heirs of the deceased Lourdes Bulado, particularly Plaintiffs Carlos and Winnie Munsalud, as well to issue a title over the same property in favor of the same heirs. WHEREFORE, it is most respectfully prayed that judgment be rendered commanding the Defendant, after due notice and hearing, to issue a deed of sale and/or a title, in favor of the heirs of the deceased Lourdes Bulado, particularly Plaintiffs Carlos and Winnie Munsalud, over the property subject of this action.26 (Underscoring supplied) A plain reading of the allegations of the complaint reveals that petitioner Winnie Munsalud assumed the obligations of her deceased mother, the original awardee of respondents "Land for the Landless Program." One of the obligations of an awardee is to pay the mont hly amortizations. Petitioners complied with said obligation and religiously paid the amortizations until these were fully paid. Indeed, petitioners have complied with what is incumbent upon them under the program. Hence, it is now the turn of respondent to comply with what is incumbent upon it. In a letter dated February 21, 2003,27 respondent informed petitioners counsel that per its records, the name of petitioner Winnie Munsalud does not appear as a beneficiary. For the guidance of respondent, Winnie Munsalud is not actually a beneficiary. The beneficiary of its program is Lourdes Bulado, her deceased mother. This fact was made known to respondent when another letter dated March 6, 200328 was sent by the counsel of the heirs of Lourdes Bulado. In the same letter, respondent was informed that petitioner Winnie is representing her deceased mother, Lourdes Bulado, viz.:

In view of the contents of that letter, we would like to notify you that Ms. Munsalud is actually representing her deceased mother, Lourdes Bulado, who, on September 14, 1989 completed her payment for Lot 12, Block 79 of the Maricaban Estate. A copy of the receipt evidencing that completed is attached hereto as Annex B for your easy reference. In view thereof, may we reiterate our request for the issuance of the title over the aforesaid property in the name of Lourdes Bulado.29 (Underscoring supplied) The letter was received by respondent on March 12, 2003. On account of this second letter, respondent could have easily verified if the name of Lourdes Bulado appears as a beneficiary and awardee of its "Land for the Landless Program." However, respondent never responded to the second letter. This left petitioners with no recourse but to bring the action to the trial court. Evidently, the action commenced by petitioners before the trial court, although designated as mandamus, is in reality an action to perform a specific act. The averments of the complaint are clear. The essential facts are sufficiently alleged as to apprise the court of the nature of the case. The relief sought to be obtained aims to compel respondent to issue a deed of sale and the corresponding title over the property awarded to Bulado. Thus, the Court finds the complaint sufficient in substance. The designation or caption is not controlling, more than the allegations in the complaint, for it is not even an indispensable part of the complaint. Instead of focusing on what an action for mandamus should contain, the court a quo should have proceeded to examine the essential facts alleged in petitioners complaint. For what determines the nature of the action and which court has jurisdiction over it are the allegations in the complaint and the character of the relief sought.30 The cause of action in a complaint is not determined by the designation given to it by the parties. The allegations in the body of the complaint define or describe it. The designation or caption is not controlling more than the allegations in the complaint. It is not even an indispensable part of the complaint.31 There is no need to make reference to any law which respondent by reason of its office is enjoined as a duty to perform. Respondents duty arose from its contractual obligation under the "Land for the Landless Program." The trial court is reminded that the caption of the complaint is not determinative of the nature of the action.32 The caption of the pleading should not be the governing factor, but rather the allegations in it should determine the nature of the action, because even without the prayer for a specific remedy, the courts may nevertheless grant the proper relief as may be warranted by the facts alleged in the complaint and the evidence introduced.33 All told, whether or not petitioner Winnie, in her capacity as a compulsory heir of the awardee, becomes a beneficiary of the program is a question best ventilated during trial on the merits. The conditions, terms, and provisions of the program in case an awardee dies are evidentiary and should be presented for determination of the court. Even the effect and the consequence of the assumption of obligation of the awardee as well as the presence of other compulsory heir s are issues that should be addressed for the courts evaluation on the basis of the evidence to be laid down before its eyes.

WHEREFORE, the appealed Decision is REVERSED AND SET ASIDE. The case is REMANDED to the Regional Trial Court which is ORDERED to reinstate the case and to conduct trial on the merits with dispatch. No costs. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila THIRD DIVISION

G.R. Nos. 121662-64 July 6, 1999 VLASON ENTERPRISES CORPORATION, petitioner, vs. COURT OF APPEALS and DURAPROOF SERVICES, represented by its General Manager, Cesar Urbino Sr., respondents. PANGANIBAN, J.: Summons to a domestic or resident corporation should be served on officers, agents or employees, who are responsible enough to warrant the presumption that they will transmit to the corporation notice of the filing of the action against it. Rules on the service of motions should be liberally construed in order to promote the ends of substantial justice. A rigid application that will result in the manifest injustice should be avoided. A default judgment against several defendants cannot affect the rights of one who was never declared in default. In any event, such judgment cannot include award not prayed for in the complaint, even if proven ex parte. The Case These principles were used by this Court in resolving this Petition for Review on Certiorari before us, assailing the July 19, 1993 Decision and the August 15 Resolution 2 promulgated by the Court of Appeals. The assailed Decision disposed as follows: 3
1

ACCORDINGLY, in view of the foregoing disquisitions, all the three (3) consolidated petitions for certiorari are hereby GRANTED. THE assailed Order of respondent Judge Arsenio Gonong of the Regional Trial Court of Manila, Branch 8, dated April 5, 1991, in the first petition for certiorari (CA-G.R. SP No. 24669); the assailed Order of Judge Bernardo Pardo, Executive Judge of the Regional Trial Court of Manila, Branch 8, dated July 6, 1992, in the second petition for certiorari (CA-G.R. SP No. 28387); and finally, the assailed order or Resolution en banc of the respondent Court of Tax Appeals Judges Ernesto Acosta, Ramon de Veyra and Manuel Gruba, under date of October 5, 1992, in the third petition for certiorari (CA-G.R. SP No. 29317) are all hereby NULLIFIED and SET ASIDE thereby giving way to the entire decision dated February 18, 1991 of the respondent Regional Trial Court of Manila, Branch 8, in Civil Case No. 89-51451 which remains valid, final and executory, if not yet wholly executed. THE writ of preliminary injunction heretofore issued by this Court on March 6, 1992 and reiterated on July 22, 1992 and this date against the named respondents specified in the dispositive portion of the judgment of the respondent Regional Trial Court of Manila, Branch 8 in the first petition for certiorari, which remains valid, existing and enforceable, is hereby MADE PERMANENT without prejudice (1) to the [private respondent's] remaining unpaid obligations to the herein party-intervenor in

accordance with the Compromise Agreement or in connection with the decision of the respondent lower court in CA-G.R. SP No. 24669 and (2) to the government, in relation to the forthcoming decision of the respondent Court of Tax Appeals on the amount of taxes, charges, assessments or obligations that are due, as totally secured and fully guaranteed payment by the [private respondent's] bond, subject to the relevant rulings of the Department of Finance and other prevailing laws and jurisprudence. The assailed Resolution ruled: ACCORDINGLY, in the light of the foregoing disquisitions, as well as considering these clarifications, the three (3) motions aforementioned are hereby DENIED. The Facts Poro Point Shipping Services, then acting as the local agent of Omega Sea Transport Company of Honduras & Panama, a Panamanian company, (hereafter referred to as Omega), requested permission for its vessel M/V Star Ace, which had engine trouble, to unload its cargo and to store it at the Philippine Ports Authority (PPA) compound in San Fernando, La Union while awaiting transshipment to Hongkong. The request was approved by the Bureau of Customs. 4 Despite the approval, the customs personnel boarded the vessel when it docked on January 7, 1989, on suspicion that it was the hijacked M/V Silver Med owned by Med Line Philippines Co., and that its cargo would be smuggled into the country. 5 The district customs collector seized said vessel and its cargo pursuant to Section 2301, Tariff and Customs Code. A notice of hearing of SFLU Seizure Identification No. 3-89 was served on its consignee, Singkong Trading Co. of Hongkong, and its shipper, Dusit International Co., Ltd. of Thailand. While seizure proceedings were ongoing, La Union was hit by three typhoons, and the vessel ran aground and was abandoned. On June 8, 1989, its authorized representative, Frank Cadacio, entered into a salvage agreement with private respondent to secure and repair the vessel at the agreed consideration of $1 million and "fifty percent (50%) [of] the cargo after all expenses, cost and taxes." 6 Finding that no fraud was committed, the District Collector of Customs, Aurelio M. Quiray, lifted the warrant of seizure on July 16, 1989. 7 However, in a Second Indorsement dated November 11, 1989, then Customs Commissioner Salvador M. Mison declined to issue a clearance for Quiray's Decision; instead, he forfeited the vessel and its cargo in accordance with Section 2530 of the Tariff and Customs Code. 8 Accordingly, acting District Collector of Customs John S. Sy issued a Decision decreeing the forfeiture and the sale of the cargo in favor of the government. 9 To enforce its preferred salvor's lien, herein Private Respondent Duraproof Services filed with the Regional Trial Court of Manila a Petition for Certiorari, Prohibition and Mandamus 10 assailing the actions of Commissioner Mison and District Collector Sy. Also impleaded as respondents were PPA Representative Silverio Mangaoang and Med Line Philippines, Inc. On January 10, 1989, private respondent amended its Petition 11 to include former District Collector Quiray; PPA Port Manager Adolfo Ll. Amor Jr; Petitioner Vlason Enterprises as represented by its president, Vicente Angliongto; Singkong Trading Company as represented by Atty. Eddie Tamondong; Banco Du Brasil; Dusit International Co., Inc.; Thai-Nan Enterprises Ltd. and Thai-United Trading Co., Ltd. 12 In both Petitions, private respondent plainly failed to include any allegation pertaining to petitioner, or any prayer for relief against it.1wphi1.nt

Summonses for the amended Petition were served on Atty. Joseph Capuyan for Med Line Philippines: Angliongto (through his secretary, Betty Bebero), Atty. Tamondong and Commissioner Mison. 13 Upon motion of the private respondent, the trial court allowed summons by publication to be served upon the alien defendants who were not residents and had no direct representatives in the country. 14 On January 29, 1990, private respondent moved to declare respondents in default, but the trial court denied the motion in its February 23, 1990 Order, 15 because Mangaoang and Amor had jointly filed a Motion to Dismiss, while Mison and Med Line had moved separately for an extension to file a similar motion. 16 Later it rendered an Order dated July 2, 1990, giving due course to the motions to dismiss filed by Mangaoang and Amor on the ground of litis pendentia, and by the commissioner and district collector of customs on the ground of lack of jurisdiction. 17 In another Order, the trial court dismissed the action against Med Line Philippines on the ground of litis pendentia. 18 On two other occasions, private respondent again moved to declare the following in default: petitioner, Quiray, Sy and Mison on March 26, 1990; 19 and Banco Du Brazil, Dusit International Co., Inc., Thai-Nan Enterprises Ltd. and Thai-United Trading Co., Ltd. on August 24, 1990. 20 There is no record, however, that the trial court acted upon the motions. On September 18, 1990, petitioner filed another Motion for leave to amend the petition, 21 alleging that its counsel failed to include the following "necessary and/or indispensable parties": Omega represented by Cadacio; and M/V Star Ace represented by Capt. Nahon Rada, relief captain. Aside from impleading these additional respondents, private respondent also alleged in the Second (actually, third) Amended Petition 22 that the owners of the vessel intended to transfer and alienate their rights and interests over the vessel and its cargo, to the detriment of the private respondent. The trial court granted leave to private respondent to amend its Petition, but only to exclude the customs commissioner and the district collector. 23 Instead, private respondent filed the "Second Amended Petition with Supplemental Petition" against Singkong Trading Company; and Omega and M/V Star Ace, 24 to which Cadacio and Rada filed a Joint Answer. 25 Declared in default in an Order issued by the trial court on January 23, 1991, were the following: Singkong Trading Co., Commissioner Mison, M/V Star Ace and Omega. 26 Private respondent filed, and the trial court granted, an ex parte Motion to present evidence against the defaulting respondents. 27 Only private respondent, Atty. Tamondong, Commissioner Mison, Omega and M/V Star Ace appeared in the next pretrial hearing; thus, the trial court declared the other respondents in default and allowed private respondent to present evidence against them. 28 Cesar Urbino, general manager of private respondent, testified and adduced evidence against the other respondents, including herein petitioner. As regards petitioner, he declared: "Vlason Enterprises represented by Atty. Sy and Vicente Angliongto thru constant intimidation and harassment of utilizing the PPA Management of San Fernando, La Union . . . further delayed, and [private respondent] incurred heavy overhead expenses due to direct and incidental expenses . . . causing irreparable damages of about P3,000,000 worth of ship tackles, rigs, and appurtenances including radar antennas and apparatuses, which were taken surreptitiously by persons working for Vlason Enterprises or its agents[.] 29 On December 29, 1990, private respondent and Rada, representing Omega, entered into a Memorandum of Agreement stipulating that Rada would write and notify Omega regarding the demand for salvage fees of private respondent; and that if Rada did not receive any instruction from his principal, he would assign the vessel in favor of the salvor. 30 On February 18, 1991, the trial court disposed as follows: WHEREFORE, IN VIEW OF THE FOREGOING, based on the allegations, prayer and evidence adduced, both testimonial and documentary, the Court is convinced, that, indeed, defendants/respondents are liable to [private respondent] in the amount as prayed for in the petition for which it renders judgment as follows:

1. Respondent M/V Star Ace, represented by Capt. Nahum Rada, [r]elief [c]aptain of the vessel and Omega Sea Transport Company, Inc., represented by Frank Cadacio[,] is ordered to refrain from alienating or transferring the vessel M/V Star Ace to any third parties; 2. Singkong Trading Company to pay the following: a. Taxes due the government; b. Salvage fees on the vessel in the amount of $1,000,000.00 based on . . . Form of Salvage Agreement; c. Preservation, securing and guarding fees on the vessel in the amount of $225,000.00; d. Maintenance fees in the amount P2,685,000.00; e. Salaries of the crew from August 16, 1989 to December 1989 in the amount of $43,000.00 and unpaid salaries from January 1990 up to the present. f. Attorney's fees in the amount of P656,000.00; 3. [Vlason] Enterprises to pay [private respondent] in the amount of P3,000,000.00 for damages; 4. Banco [Du] Brazil to pay [private respondent] in the amount of $300,000.00 in damages; and finally, 5. Costs of [s]uit. Subsequently, upon the motion of Omega, Singkong Trading Co. and private respondent, the trial court approved a Compromise Agreement 31 among the movants, reducing by 20 percent the amounts adjudged. For their part, respondents-movants agreed not to appeal the Decision. 32 On March 8, 1991, private respondent moved for the execution of judgment, claiming that the trial court Decision had already become final and executory. 33 The Motion was granted 34 and a Writ of Execution was issued. 35 To satisfy the Decision, Sheriffs Jorge Victorino, Amado Sevilla and Dionisio Camagon were deputized on March 13, 1991 to levy and to sell on execution the defendant's vessel and personal property. On March 14, 1991, petitioner filed, by special appearance, a Motion for Reconsideration on the grounds that it was allegedly not impleaded as a defendant, served summons or declared in default; that private respondent was not authorized to present evidence against it in default; that the judgment in default was fatally defective, because private respondent had not paid filing fees for the award; and that private respondent had not prayed for such award. 36 Private respondent opposed the Motion, arguing that it was a mere scrap of paper due to its defective notice of hearing. On March 18, 1991, the Bureau of Customs also filed an ex parte Motion to recall the execution, and to quash the notice of levy and the sale on execution. 37 Despite this Motion, the auction sale was conducted on March 21, 1991 by Sheriff Camagon, with private respondent submitting the winning

bid. 38 The trial court ordered the deputy sheriffs to cease and desist from implementing the Writ of Execution and from levying on the personal property of the defendants. 39 Nevertheless, Sheriff Camagon issued the corresponding Certificate of Sale on March 27, 1991. 40 On April 12, 1991, 41 private respondent filed with the Court of Appeals (CA) a Petition for Certiorari and Prohibition to nullify the cease and desist orders of the trial court. 42 Respondent Court issued on April 26, 1991 a Resolution which reads: 43 MEANWHILE, in order to preserve the status quo and so as not to render the present petition moot and academic, a TEMPORARY RESTRAINING ORDER is hereby ISSUED enjoining the respondent Judge, the Honorable Arsenio M. Gonong, from enforcing and/or implementing the Orders dated 22 March 1991 and 5 April 1991 which ordered respondent Sheriff to cease and desist from implementing the writ of execution and the return thereof, the quashing of the levy . . . on [the] execution [and sale] of the properties levied upon and sold at public auction by the Sheriff, for reason of grave abuse of discretion and in excess of jurisdiction, until further orders from this Court. WITHIN ten (10) days from notice hereof, respondents [petitioner included] are also required to SHOW CAUSE why the prayer for a writ of preliminary injunction should not be granted. On May 8, 1991, petitioner received from Camagon a notice to pay private respondent P3 million to satisfy the trial court Decision. Not having any knowledge of the CA case to which it was not impleaded, petitioner filed with the trial court a Motion to Dismiss ex abutandi ad cautelam on the grounds that (1) the Petition of private respondent stated no cause of action against it, (2) the trial court had no jurisdiction over the case, and (3) litis pendentia barred the suit. 44 On May 10, 1991, Camagon levied on petitioner's properties, which were scheduled for auction later on May 16, 1991. Specific descriptions of the properties are as follows: 45 a) Motor Tugboat "DEN DEN" ex Emerson-l. Length: 35.67 ms. Breadth: 7.33 ms. Depth: 3.15 ms Gross Tons: 205.71 Net tons: 67.48 ms Official Number: 213551 Material: Steel Class license: CWL License No. 4424 b) Barge "FC99" ex YD-153 Length: 34.15 ms. Breadth: 15.85 m.s. Depth: 2.77 m.s. Gross Tons: 491.70

Net Tons: 491.70 Official Number: 227236 Material: Steel Class License: CWL License No. 83-0012 c) Barge "LAWIN" ex "Sea Lion 2". Length: 66.92 ms. Breadth: 11.28 ms. Depth: 4.52 m.s. Gross Tons: 1,029.56 Net Tons: 1,027/43 Official Number: 708069 Material: Steel Class License: Coastwise License No. 81-0059 Petitioner also filed a special appearance before the CA. It prayed for the lifting of the levy on its properties or, alternatively, for a temporary restraining order against their auction until its Motion for Reconsideration was resolved by the trial court. 46 Acting on petitioner's Motion for Reconsideration, the trial court reversed its Decision of February 18, 1991, holding in its May 22, 1991 Resolution as follows: 47 . . . [T]hat . . . Motion for Reconsideration [of petitioner] was filed on March 14, 1991 (see: page 584, records, Vol. 2) indubitably showing that it was seasonably filed within the 15-day time-frame. Therefore, . . . said default-judgment ha[d] not yet become final and executory when the Writ of Execution was issued on March 13, 1991 . . . The rules [provide] that [the e]xecution shall issue as a matter of right upon the expiration of the period of appeal from a judgment if no appeal has been duly perfected (Sec. 1, R-39, RRC). That being the case, VEC has all the right to file as it did . . . the aforementioned reconsideration motion calling [the] attention of the Court and pointing therein its supposed error and its correction if, indeed, any [error was] committed. It is in this light that this Court made an in-depth reflection and assessment of the premises or reasons raised by [petitioner], and after a re-examination of the facts and evidence spread on the records, it has come to the considered conclusion that the questioned default-judgment has been improvidently issued. By the records, the claim of [private respondent] that his January 29, 1990 Ex-Parte Motion To Declare Defendants In Default (pp. 174-177, records, Vol. 1) including VEC had been granted is belied by the February 23, 1990 Order (pp. 214-215, records, ibid) par. 2, thereof, reading to wit: By the foregoing, for reasons stated thereunder respectively, this Court, in the exercise of its judicious discretion, in the sense that the rules should be liberally construed in order to promote their object and to assist the parties, resolves to DENY petitioner's Motion to have the Commissioner of Customs AND OTHER ENUMERATED RESPONDENTS DECLARED IN DEFAULT. [Emphasis ours].

Not even [private respondent's] November 23, 1990 "Ex-Parte Motion To Present [Evidence] Against Defaulting Defendants" (page 489, records, Vol. 2) [can] be deemed as a remedy of the fact that there never was issued an order of default against respondents including [petitioner] VEC. Having thus established that there [had] been no order of default against VEC as contemplated by Sec. 1, Rule 18, in relation to Sec. 9, Rule 13, Revised Rules of Court, there could not have been any valid default-judgment rendered against it. The issuance of an order of default is a condition sine qua non in order [that] a judgment by default be clothed with validity. Further, records show that this Court never had authorized [private respondent] to adduce evidence ex-parte against [petitioner] VEC. In sum, the February 18, 1991 decision by default is null and void as against [petitioner] VEC. With this considered conclusion of nullity of said default judgment in question, this Court feels there is no more need for it to resolve Arguments I-A & I-B, as well as III-A & III-B, of the March 14, 1991 Motion for Reconsideration. The Court agrees, however, with said discussions on the non-compliance [with] Sec. 2, Rule 7 (Title of Complaint) and Sec. I, Rule 8 on the requirement of indicating in the complaint the ultimate facts on which the party pleading relies for his claim of defense [--] which is absent in the January 9, Amended Petition (pp. 122-141, records, Vol. I) [--] for it merely mentioned [petitioner] VEC in par. 5 thereof and no more. It abides, likewise, with [Argument] III-B that the Decision in suit award[ed] amounts never asked for in instant petition as regards VEC (Sec. 5, Rule 18, RRC). . . . . WHEREFORE, in view of the foregoing consideration, and as prayed for, the February 18, 1991 Judgment by Default is hereby reconsidered and SET ASIDE. On June 26, 1992, then Executive Judge Bernardo P. Pardo 48 of the Regional Trial Court of Manila issued an Order Report/Return dated April 1, 1991, and all proceedings taken by Camagon.
49

annulling the Sheriff's

The CA granted private respondent's Motion to file a Supplemental Petition impleading petitioner in CA-GR 24669. 50 In view of the rampant pilferage of the cargo deposited at the PPA compound, private respondent obtained from the appellate court a Writ of Preliminary Injunction dated March 6, 1992. The Writ: reads: 51 ACCORDINGLY, in view of the foregoing disquisitions, the urgent verified motion for preliminary injunction dated February 11, 1992 is hereby GRANTED. Therefore, let a writ of preliminary injunction forthwith issue against the respondents and all persons or agents acting in their behalf, enjoining them not to interfere in the transferring of the aforementioned vessel and its cargoes, or in removing said cargoes . . . from [the] PPA compound. On September 15, 1992, Sheriff Amado Sevilla seized petitioner's motor tugboat Den Den by virtue of the Order by the RTC of Manila, Branch 26. 53 On August 6, 1992, the CA consolidated CA-GR SP No. 28387 54 with CA-GR SP No. 24669. 1992, a Resolution in CTA Case Nos. 4492, 4494 and 4500, which disposed as follows:
55 52

dated April 3, 1992, issued

The Court of Tax Appeals issued on October 5,

Confirming the order in open court on October 5, 1992, the Court hereby RESOLVES to: 1. Order Respondent Commissioner of Customs to assign or detail [a] sufficient number of customs police and guards aboard, and around the vicinity of, the vessel "M/V Star Ace" now in anchor at Mariveles, Bataan or elsewhere, in order to ensure its safety during the pendency of these cases;

2. Direct him to assign personnel and/or representatives to conduct an inventory of part of the vessel's cargo now in the possession of Mr. Cesar S. Urbino, Sr. at 197 Heroes del "96 Street, Caloocan City, which inventory may be participated in by all the parties interested in said cargo." To enjoin the CTA from enforcing said Order, private respondent filed before the Court of Appeals another Petition for Certiorari, later also consolidated with CA-GR SP No. 24669.
56

which was

On July 19, 1993, the CA rendered the assailed Decision. Petitioner filed (1) a Motion for Clarification, praying for a declaration that the trial court Decision against it was not valid; and (2) a partial Motion for Reconsideration, seeking to set aside the assailed Decision insofar as the latter affected it. On July 5, 1995, the Court of Appeals issued the following Resolution:
57

Pending resolution of the motions for reconsideration, filed by Vlason Enterprises Corporation and Banco [Du] Brazil, and considering [private respondent's] Motion for Entry of Judgment with respect to respondent PPA having already been granted by this Court as far back as June 17, 1994, pursuant to the resolution of the Supreme Court dated December 8, 1993 in G.R. No. 111270-72 (Philippine Ports Authority vs. Court of Appeals, et al.) informing the parties in the said case that the judgment sought to be reviewed has now become final and executory, the lower court may now take appropriate action on the urgent exparte motion for issuance a writ of execution, filed by [private respondent] on July 15, 1994. On August 28, 1995, the Regional Trial Court of Manila, Branch 26, issued a Writ of Possession which resulted in private respondent taking possession of petitioner's barge Lawin (formerly Sea Lion 2) on September 1, 1995. 58 Hence, this Petition.
59

Ruling of the Respondent Court As already adverted to, Respondent Court granted the Petition for Certiorari of the private respondent, which was consolidated with the latter's two other Petitions. The court a quo issued the following rulings: 1. The trial court had jurisdiction over the salvor's claim or admiralty case pursuant to Batas Pambansa Bilang 129. 2. Since the Decision of the trial court became final and executory, never having been disputed or appealed to a higher court, the trial judge committed grave abuse of discretion in recalling the Writ of Execution and in quashing the levy and the execution of the sale of M/V Star Ace and its cargo. 2. Such acts constituted an alteration or a modification of a final and executory judgment and could never be justified under law and jurisprudence. 3. Civil Case 59-51451 dealt only with the salvor's claim without passing upon the legality or the validity of the undared Decision of the Commissioner of Customs in the seizure proceeding.

4. Petitioner and his co-respondents could not invoke the jurisdiction of a court to secure affirmative relief against their opponent and, after failing to obtain such relief, question the court's jurisdiction. 5. Petitioner had no recourse through any of the following judicially accepted means to question the final judgment: a. a petition for relief from judgment under Rule 38, b. a direct action to annul and enjoin the enforcement of the questioned judgment, and c. a collateral attack against the questioned judgment which appears void on its face. 6. A court which has already acquired jurisdiction over a case cannot be ousted by a coequal court; the res in this case the vessel and its cargo were placed under the control of the trial court ahead of the CTA. 7. The admiralty Decision had attained finality while the issue of the validity of the seizure proceedings was still under determination. In the assailed Resolution, Respondent Court clarified that there was no need to serve summons anew on petitioner, since it had been served summons when the Second Amended Petition (the third) was filed; and that petitioner's Motion for Reconsideration was defective and void, because it contained no notice of hearing addressed to the counsel of private respondent in violation of Rule 16, Section 4 of the Rules of Court. To this second motion, [private respondent] contends that there was no need to serve summons anew to VEC when the second amended petition was filed impleading VEC, pursuant to the ruling of the Supreme Court in Asiatic Travel Corp. vs. CA (164 SCRA 623); and that finally, the decision of the court a quo o[n] February 18, 1991 became final and executory, notwithstanding the timely filing of the motion for reconsideration of VEC for the reason that the said motion for reconsideration was defective or void, there being no notice of hearing addressed to the counsel of petitioner. In fact, no motion such as this instant one can be acted upon by the Court without proof of service of the notice thereof, pursuant to Rule 16, Section 4 of the Rules of Court. xxx xxx xxx Finally, we should never lose sight of the fact that the instant petition for certiorari is proper only to correct errors of jurisdiction committed by the lower court, or grave abuse of discretion which is tantamount to lack of jurisdiction Where the error is not one of jurisdiction but an error of law or of fact which is a mistake of judgment, appeal is the remedy (Salas vs. Castro. 216 SCRA 198). Here, respondents failed to appeal. Hence, the decision dated February 18, 1991 of the lower court has long become final, executory and unappealable. We do not and cannot therefore review the instant case as if it were on appeal and direct actions on these motions. While the proper remedy is appeal, the action for certiorari will not be entertained. Indeed, certiorari is not a substitute for lapsed appeal.

At any rate, the decision dated July 19, 1993 of this Court on the main petition for certiorari is not yet final (except with respect to respondent PPA), the Bureau of Customs having filed a petition for certiorari and prohibition, under Rule 65 of the Rules of Court, with the Supreme Court, necessitating prudence on Our part to await its final verdict. 60 Assignment of Errors Before us, petitioner submits the following assignment of errors on the part of Respondent Court: I The Court of Appeals committed serious error in ruling that the entire decision of the trial court in Civil Case No. 89-51451 dated 18 February 1991 became final and executory because it "was never disputed or appealed". A VEC filed a motion for reconsideration of the said decision two days before deadline, which motion was granted by the trial court. B The trial court correctly granted VEC's motion for reconsideration and set aside the 18 February 1991 decision . . . against VEC, for: 1. The trial court never acquired jurisdiction over the person of VEC as to enable it to render any judgment against it: (i) VEC was not impleaded as a respondent in Civil Case No. 89- 51451; (ii) Summons was not served on VEC; 2. The trial court improperly rendered judgment by default against VEC; (i) The trial court never issued an order of default against VEC; (ii) The trial court never authorized ex-parte presentation of evidence against VEC. 3. The Judgment by default was fatally defective because: (i) No filing fee was paid by [private respondent) for the staggering amount of damages awarded by the trial court. (ii) The 18 February 1991 decision violates the Revised Rules of Court, which prescribe that a judgment by default cannot decree a relief not prayed for. II
61

Since the 18 February 1991 Decision in Civil Case No. 89-51451 is void as against VEC, the recall of the writ of execution was valid, as far as VEC is concerned. The Court believes that the issues can be simplified and restated as follows: 1. Has the February 18, 1991 RTC Decision become final and executory in regard to petitioner? 2. Did the trial court acquire jurisdiction over the petitioner? 3. Was the RTC default judgment binding on petitioner? 4. Was the grant of damages against petitioner procedurally proper? 5. Was private respondent entitled to a writ of execution? This Court's Ruling The petition is meritorious. First Issue: Finality of the RTC Decision A judgment becomes "final and executory" by operation of law. Its finality becomes a fact when the reglementary period to appeal lapses, and no appeal is perfected within such period. 62 The admiralty case filed by private respondent with the trial court involved multiple defendants. This being the case, it necessarily follows that the period of appeal of the February 18, 1991 RTC Decision depended on the date a copy of the judgment was received by each of the defendants. Elsewise stated, each defendant had a different period within which to appeal, depending on the date of receipt of the Decision. 63 Omega, Singkong Trading Co. and M/V Star Ace chose to enter into a compromise agreement with private respondent. As to these defendants, the trial court Decision had become final, and a writ of execution could be issued against them. 64 Doctrinally, a compromise agreement is immediately final and executory. 65 Petitioner, however, is not in the same situation. Said Decision cannot be said to have attained finality as to the petitioner, which a party to the compromise. Moreover, petitioner filed a timely Motion for Reconsideration with the trial court, thirteen days after it received the Decision or two days before the lapse of the reglementary period to appeal. 66 Thus, as to petitioner, the trial court Decision had not attained finality. Exception to the Rule on Notice of Hearing Respondent Court and private respondent argue that, although timely filed, petitioner's Motion for Reconsideration was a mere scrap of paper, because (1) it did not contain a notice of hearing addressed to the current counsel of private respondent, and (2) the notice of hearing addressed to and served on private respondent's deceased counsel was not sufficient. Admittedly, this Motion contained a notice of hearing

sent to Atty. Jesus C. Concepcion who, according to private respondent, had already died and had since been substituted by its new counsel, Atty. Domingo Desierto. Therefore, the appellate court ruled that the said Motion did not toll the reglementary period to appeal and that the trial court Decision became final. This Court disagrees. Rule 15 of the Rules of Court states: Sec. 4. Notice. Notice of a motion shall be served by the applicant to all parties concerned, at least three (3) days before the hearing thereof, together with a copy of the motion, and of any affidavits and other papers accompanying it. The court, however, for good cause may hear a motion on shorter notice, specially on matters which the court may dispose of on its own motion. Sec. 5. Contents of notice. The notice shall be directed to the parties concerned, and shall state the time and place for the hearing of the motion. 67 Ideally, the foregoing Rule requires the petitioner to address and to serve on the counsel of private respondent the notice of hearing of the Motion for Reconsideration. The case at bar, however, is far from ideal. First, petitioner was not validly summoned and it did not participate in the trial of the case in the lower court; thus, it was understandable that petitioner would not be familiar with the parties and their counsels. Second, Atty. Desierto entered his appearance only as collaborating counsel, 68 who is normally not entitled to notices even from this Court. Third, private respondent made no manifestation on record that Atty. Concepcion was already dead. Besides, it was Atty. Concepcion who signed the Amended Petition, wherein petitioner was first impleaded as respondent and served a copy thereof. Naturally, petitioner's attention was focused on this pleading, and it was within its rights to assume that the signatory to such pleading was the counsel for private respondent. The Court has consistently held that a motion which does not meet the requirements of Sections 4 and 5 of Rule 15 of the Rules of Court is considered a worthless piece of paper, which the clerk of court has no right to receive and the trial court has no authority to act upon. Service of a copy of a motion containing a notice of the time and the place of hearing of that motion is a mandatory requirement, and the failure of movants to comply with these requirements renders their motions fatally defective. 69 However, there are exceptions to the strict application of this rule. These exceptions are as follows: 70 . . . Liberal construction of this rule has been allowed by this Court in cases (1) where a rigid application will result in a manifest failure or miscarriage of justice; 71 especially if a party successfully shows that the alleged defect in the questioned final and executory judgment is not apparent on its face or from the recitals contained therein; (2) where the interest of substantial justice will be served; 72 (3) where the resolution of the motion is addressed solely to the sound and judicious discretion of the court; 73 and (4) where the injustice to the adverse party is not commensurate [to] the degree of his thoughtlessness in not complying with the procedure prescribed. 74 The present case falls under the first exception. Petitioner was not informed of any cause of action or claim against it. All of a sudden, the vessels which petitioner used in its salvaging business were levied upon and sold in execution to satisfy a supposed judgment against it. To allow this to happen simply because of a lapse in fulfilling the notice requirement which, as already said, was satisfactorily explained would be a manifest failure or miscarriage of justice.

A notice of hearing is conceptualized as an integral component of procedural due process intended to afford the adverse parties a chance to be heard before a motion is resolved by the court. Through such notice, the adverse party is permitted time to study and answer the arguments in the motion. Circumstances in the case at bar show that private respondent was not denied procedural due process, and that the very purpose of a notice of hearing had been served. On the day of the hearing, Atty. Desierto did not object to the said Motion for lack of notice to him; in fact, he was furnished in open court with a copy of the motion and was granted by the trial court thirty days to file his opposition to it. These circumstances clearly justify a departure from the literal application of the notice of hearing rule. 75 In other cases, after the trial court learns that a motion lacks such notice, the prompt resetting of the hearing with due notice to all the parties is held to have cured the defect. 76 Verily, the notice requirement is not a ritual to be followed blindly. Procedural due process is not based solely on a mechanistic and literal application that renders any deviation inexorably fatal. Instead, procedural rules are liberally construed to promote their objective and to assist in obtaining a just, speedy and inexpensive determination of any action and proceeding. 77 For the foregoing reasons, we believe that Respondent Court committed reversible error in holding that the Motion for Reconsideration was a mere scrap of paper. Second Issue: Jurisdiction Over Petitioner Service of Summons on a Corporation The sheriff's return shows that Angliongto who was president of petitioner corporation, through his secretary Betty Bebero, was served summons on January 18, 1990. 78 Petitioner claims that this service was defective for two reasons: (1) Bebero was an employee of Vlasons Shipping, Inc., which was an entity separate and distinct from Petitioner Vlason Enterprises Corporation (VEC); and (2) the return pertained to the service of summons for the amended Petition, not for the "Second Amended Petition with Supplemental Petition," the latter pleading having superseded the former. A corporation may be served summons through its agents or officers who under the Rules are designated to accept service of process. A summons addressed to a corporation and served on the secretary of its president binds that corporation. 79 This is based on the rationale that service must be made on a representative so integrated with the corporation sued, that it is safe to assume that said representative had sufficient responsibility and discretion to realize the importance of the legal papers served and to relay the same to the president or other responsible officer of the corporation being sued. 80 The secretary of the president satisfies this criterion. This rule requires, however, that the secretary should be an employee of the corporation sought to be summoned. Only in this manner can there be an assurance that the secretary will "bring home to the corporation [the] notice of the filing of the action" against it. In the present case, Bebero was the secretary of Angliongto, who was president of both VSI and petitioner, but she was an employee of VSI, not of petitioner. The piercing of the corporate veil cannot be resorted to when serving summons. 81 Doctrinally, a corporation is a legal entity distinct and separate from the members and stockholders who compose it. However, when the corporate fiction is used as a means of perpetrating a fraud, evading an existing obligation, circumventing a statute, achieving or perfecting a monopoly or, in generally perpetrating a crime, the veil will be lifted to expose the individuals composing it. None of the foregoing exceptions has been shown to exist in the present case. Quite the contrary, the piercing of the corporate veil in this case will result in manifest injustice. This we cannot allow. Hence, the corporate fiction remains.

Effect of Amendment of Pleading on Jurisdiction Petitioner claims that the trial court did not acquire jurisdiction over it, because the former had not been served summons anew for the Second Amended Petition or for the Second Amended Petition with Supplemental Petition. In the records, it appears that only Atty. Tamondong, counsel for Singkong Trading, was furnished a copy of the Second Amended Petition. 82 The corresponding sheriff's return indicates that only Omega, M/V Star Ace and Capt. Rada were served summons and copies of said Petition. 83 We disagree. Although it is well-settled that an amended pleading supersedes the original one, which is thus deemed withdrawn and no longer considered part of the record, it does not follow ipso facto that the service of a new summons for amended petitions or complaints is required. Where the defendants have already appeared before the trial court by virtue of a summons on the original complaint, the amended complaint may be served upon them without need of another summons, even if new causes of action are alleged. 84 After it is acquired, a court's jurisdiction continues until the case is finally terminated. Conversely, when defendants have not yet appeared in court and no summons has been validly served, new summons for the amended complaint must be served on them. 85 It is not the change of cause of action that gives rise to the need to serve another summons for the amended complaint, but rather the acquisition of jurisdiction over the persons of the defendants. If the trial court has not yet acquired jurisdiction over them, a new service of summons for the amended complaint is required.1wphi1.nt In this case, the trial court obviously labored under the erroneous impression that petitioner had already been placed under its jurisdiction since it had been served summons through the secretary of its president. Thus, it dispensed with the service on petitioner of new summons for the subsequent amendments of the Petition. We have already ruled, however, that the first service of summons on petitioner was invalid. Therefore, the trial court never acquired jurisdiction, and the said court should have required a new service of summons for the amended Petitions. Impleading a Party in the Title of the Complaint Petitioner further claims that the trial court failed to acquire jurisdiction to render judgment against it because (1) the title of the three Petitions filed by private respondent never included petitioner as a party-defendant, in violation of Rule 7; and (2) the Petitions failed to state any allegation of ultimate facts constituting a cause of action against petitioner. We disagree with petitioner on the first ground. The judicial attitude has always been favorable and liberal in allowing amendments to pleadings. Pleadings shall be construed liberally so as to render substantial justice to the parties and to determine speedily and inexpensively the actual merits of the controversy with the least regard to technicalities. 86 The inclusion of the names of all the parties in the title of a complaint is a formal requirement under Section 3, Rule 7. However, the rules of pleadings require courts to pierce the form and go into the substance and not to be misled by a false or wrong name given to a pleading. The averments in the complaint, not the title, controlling. Although the general rule requires the inclusion of the names of all the parties in the title of a complaint, the non-inclusion of one or some of them is not fatal to the cause of action of a plaintiff, provided there is a statement in the body of the petition indicating that a defendant was made a party to such action.

Private respondent claims that petitioner has always been included in the caption of all the Petitions it filed, which included Antonio Sy, field manager of petitioner. We checked and noted that in the caption and the body of the Amended Petition and Second Amended Petition with Supplemental Petition, Antonio Sy alleged to be representing Med Line Philippines, not petitioner. Because it was private respondent who was responsible for the errors, the Court cannot excuse it from compliance, for such action will prejudice petitioner, who had no hand in the preparation of these pleadings. In any event, we reiterate that, as a general rule, mere failure to include the name of a party in the title of a complaint is not fatal by itself. Stating a Cause of Action in the Complaint The general rule is allegata et probata a judgment must conform to the pleadings and the theory of the action under which the case was tried. 87 But a court may also rule and render judgment on the basis of the evidence before it, even though the relevant pleading has not been previously amended, so long as no surprise or prejudice to the adverse party is thereby caused. 88 In the case at bar, the liability of petitioner was based not on any allegation in the four Petitions filed with the trial court, but on the evidence presented ex parte by the private respondent. Since the trial court had not validly acquired jurisdiction over the person of petitioner, there way for the latter to have validly and knowingly waived its objection to the private respondent's presentation of evidence against it. Third Issue: Judgment by Default The trial court Decision holding petitioner liable for damages is basically a default judgment. In Section 18, judgment by default is allowed under the following condition: 89 Sec. 1. Judgment by default. If the defendant fails to answer within the time specified in these rules, the court shall, upon motion of the plaintiff and proof of such failure, declare the defendant in default. Thereupon the court shall proceed to receive the plaintiff's evidence and render judgment granting him such relief as the complaint and the facts proven may warrant. . . . . Thus, it becomes crucial to determine whether petitioner was declared in default, and whether the reception of evidence ex parte against it was procedurally valid. Petitioner Was Never Declared In Default Petitioner insists that the trial court never declared it in default. We agree. The trial court denied the January 29, 1990 Motion of private respondent to declare all the defendants in default, but it never acted on the latter's subsequent Motion to declare petitioner likewise. During the pretrial on January 23, 1993, the RTC declared in default only "Atty. Eddie Tamondong, as well as the other defendants Hon. Salvador Mison, M/V Star Ace, Omega Sea Transport Co., Inc. of Panama and Sinkong Trading Co., [but] despite . . . due notice to them, [they] failed to appear. 90 Even private respondent cannot pinpoint which trial court order held petitioner in default.

More important, the trial court, in its Resolution dated May 22, 1991, admitted that it never declared petitioner in default, viz.: . . . It is in this light that this [c]ourt made an in-depth reflection and assessment of the premises or reasons raised by [petitioner] VEC[;] and after a re-examination of the facts and evidence spread on the records, it has come to the considered conclusion that the questioned default-judgment has been improvidently issued. [Based on] the records, the claim of [private respondent] that [its] January 29, 1990 Ex-Parte Motion to Declare Defendants In Default (pp. 174-177, records, Vol. 1) including VEC had been granted is belied by the February 23, 1990 Order (pp. 214-215, records, ibid.) par. 2, thereof, . . . xxx xxx xxx Not even petitioner's November 23, 1990 "Ex-Parte Motion To Present Evidence Against Defaulting Defendants" (page 489, records, Vol. 2) [can] be deemed as a remedy [for] the fact that there never was issued an order of default against respondents including [petitioner] VEC. Having thus established that there ha[d] been no order of default against VEC as contemplated by Sec. 1, Rule 18, in relation to Sec. 9, Rule 13, Revised Rules of Court, there could not have been any valid default-judgment rendered against it. The issuance of an order [o]f default is a condition sine qua non in order [that] a judgment by default be clothed with validity. Further, records show that this [c]ourt never had authorized [private respondent] to adduce evidence ex-parte against [Petitioner] VEC. In sum, the February 18, 1991 decision by default is null and void as against [Petitioner] VEC. . . . The aforementioned default judgment refers to the February 18, 1989 Decision, not to the Order finding petitioner in default as contended by private respondent. Furthermore, it is a legal impossibility to declare a party-defendant to be in default before it was validly served summons. Trial Court Did Not Allow Presentation of Evidence Ex Parte Against Petitioner The Order of December 10, 1990, which allowed the presentation of evidence ex parte against the defaulting defendants, could not have included petitioner, because the trial court granted private respondent's motion praying for the declaration of only the foreign defendants in default. So too, private respondent's ex parte Motion to present evidence referred to the foreign defendants only. 91 Furthermore, the reception of evidence ex parte against a non-defaulting party is procedurally indefensible. Without a declaration that petitioner is in default as required in Section 1, Rule 18, the trial court had no authority to order the presentation of evidence ex parte against petitioner to render judgment against it by default. The trial judge must have thought that since it failed to summons and was in default, it effectively waived any objection to the presentation of evidence against it. This rule, however, would have applied only if petitioner had submitted itself to the jurisdiction of the trial court. The latter correctly declared, in the Resolution just cited, that the default judgment against the former had been improvidently rendered. Fourth Issue: Award Not Paid and Prayed For Additional Filing Fees as

Lien on the Judgment Had the trial court validly acquired jurisdiction over petitioner, nonpayment of docket fees would not have prevented it from holding petitioner liable for damages. The Court, in Manchester Development Corporation v. Court of Appeals, 92 ruled that a court acquires jurisdiction over any case only upon the payment of the prescribed docket fee, not upon the amendment of the complaint or the payment of the docket fees based on the amount sought in the amended pleading. This ruling, however, was modified in Sun Insurance Office, Ltd. v. Asuncion, 93 which added: 3. Where the trial court acquires jurisdiction over a claim [through] the filing of the appropriate pleading and payment of the prescribed filing fee but, subsequently, the judgment awards a claim not specified in the pleading, or if specified the same has been left for determination by the court, the additional filing fee therefor shall constitute a lien on the judgment. It shall be the responsibility of the Clerk of Court or his duly authorized deputy to enforce said lien and assess and collect the additional fee. Filing fees for damages and awards that cannot be estimated constitute liens on the awards finally granted by the trial court. Their nonpayment alone is not a ground for the invalidation of the award. Judgment by Default Cannot Grant Relief Prayed For A declaration or order of default is issued as a punishment for unnecessary delay in joining issues. In such event, defendants lose their standing in court, they cannot expect the trial court to act upon their pleadings, and they are not entitled to notice of the proceeding until the final termination of the case. 94 Thus, the trial court proceeds with the reception of the plaintiff's evidence upon which a default judgment is rendered. Section 1 of Rule 18 provides that after the defendant has been declared in default, "the court shall proceed to receive the plaintiff's evidence and render judgment granting him such relief as the complaint and the facts proven may warrant." The reliefs that may be granted, however, are restricted by Section 5, which provides that a judgment entered against a party in default shall not exceed the amount or be different in kind from that prayed for. In other words, under Section 1, a declaration of default is not an admission of the truth or the validity of the plaintiff's claims. 95 The claimant must still prove his claim and present evidence. In this sense the law gives defaulting parties some measure of protection because plaintiffs, despite the default of defendants, are still required to substantiate their allegations in the complaint. The judgment of default against defendants who have not appeared or filed their answers does not imply a waiver of all their rights, except their right to be heard and to present evidence in their favor. Their failure to answer does not imply their admission of the facts and the causes of action of the plaintiffs, because the latter are required to adduce evidence to support their allegations. Moreover, the trial court is not allowed by the Rules to receive evidence that tends to show a relief not sought or specified in the pleadings. The plaintiff cannot be granted an award greater than or different in kind from that specified in the complaint. 97
96

This case should be distinguished, however, from that of defendants, who filed an answer but were absent during trial. In that case, they can be held liable for an amount greater than or different from that originally prayed for, provided that the award is warranted by the proven facts. This rule is premised on the theory that the adverse party failed to object to evidence relating to an issue not raised in the pleadings.

The latter rule, however, is not applicable to the instant case. Admittedly, private respondent presented evidence that would have been sufficient to hold petitioner liable for damages. However, it did not include in its amended Petitions any prayer for damages against petitioner. Therefore, the trial court could not have validly held the latter liable for damages even if it were in default. Fifth Issue: Execution of Final Judgment Section 1 of Rule 39 provides that execution shall issue only upon a judgment that finally disposes of the action or proceeding. Such execution shall issue as a matter of right upon the expiration of the period to appeal it, if no appeal has been duly perfected. 98 In the present case, however, we have already shown that the trial court's Decision has not become final and executory against petitioner. In fact, the judgment does not even bind it. Obviously, Respondent Court committed serious reversible errors when it allowed the execution of the said judgment against petitioner. WHEREFORE, the appeal is hereby GRANTED, and the assailed Decision and Resolution of the Court of Appeals are REVERSED and SET ASIDE insofar as they affect petitioner. The levy and the sale on execution of petitioner's properties are declared NULL and VOID. Said properties are ordered RESTORED to petitioner. No pronouncement as to costs.

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. 173192 April 14, 2008

ROSENDO BACALSO, RODRIGO BACALSO, MARCILIANA B. DOBLAS, TEROLIO BACALSO, ALIPIO BACALSO, JR., MARIO BACALSO, WILLIAM BACALSO, ALIPIO BACALSO III and CRISTITA B. BAES, petitioners, vs. MAXIMO PADIGOS, FLAVIANO MABUYO, GAUDENCIO PADIGOS, DOMINGO PADIGOS, VICTORIA P. ABARQUEZ, LILIA P. GABISON, TIMOTEO PADIGOS, PERFECTO PADIGOS, PRISCA SALARDA, FLORA GUINTO, BENITA TEMPLA, SOTERO PADIGOS, ANDRES PADIGOS, EMILIO PADIGOS, DEMETRIO PADIGOS, JR., WENCESLAO PADIGOS, NELLY PADIGOS, EXPEDITO PADIGOS, HENRY PADIGOS and ENRIQUE P. MALAZARTE, respondents. DECISION CARPIO MORALES, J.: The case at bar involves a parcel of land identified as Lot No. 3781 (the lot) located in Inayawan, Cebu, covered by Original Certificate of Title No. RO-2649 (0-9092)1 in the name of the following 13 co-owners, their respective shares of which are indicated opposite their names: Fortunata Padigos (Fortunata) Felix Padigos (Felix) Wenceslao Padigos (Wenceslao) Maximiano Padigos (Maximiano) Geronimo Padigos (Geronimo) Macaria Padigos Simplicio Padigos (Simplicio) Ignacio Padigos (Ignacio) Matilde Padigos Marcelo Padigos Rustica Padigos Raymunda Padigos Antonino Padigos 1/8 1/8 1/8 1/8 1/8 1/8 1/8 1/48 1/48 1/48 1/48 1/48 1/48

Maximo Padigos (Maximo), Flaviano Mabuyo (Flaviano), Gaudencio Padigos (Gaudencio), Domingo Padigos (Domingo), and Victoria P. Abarquez (Victoria), who are among the herein respondents, filed on April 17, 1995, before the Regional Trial Court (RTC) of Cebu City, a Complaint,2 docketed as Civil Case No. CEB-17326, against Rosendo Bacalso (Rosendo) and Rodrigo Bacalso (Rodrigo) who are among the herein petitioners, for quieting of title, declaration of nullity of documents, recovery of possession, and damages. The therein plaintiffs-herein respondents Maximo and Flaviano claimed that they are children of the deceased co-owner Simplicio; that respondents Gaudencio and Domingo are children of the deceased co-owner Ignacio; and that respondent Victoria and respondent Lilia P. Gabison (Lilia) are grandchildren of the late co-owner Fortunata.3 Respondents also alleged that the therein defendants-petitioners Rosendo and Rodrigo are heirs of Alipio Bacalso, Sr. (Alipio, Sr.) who, during his lifetime, secured Tax Declaration Nos. L-078-02223 and L-078-02224 covering the lot without any legal basis; that Rosendo and Rodrigo have been leasing portions of the lot to persons who built houses thereon, and Rosendo has been living in a house built on a portion of the lot;4 and that demands to vacate and efforts at conciliation proved futile, 5 prompting them to file the complaint at the RTC. In their Answer6 to the complaint, petitioners Rosendo and Rodrigo claimed that their father Alipio, Sr. purchased via deeds of sale the shares in the lot of Fortunata, Simplicio, Wenceslao, Geronimo, and Felix from their respective heirs, and that Alipio, Sr. acquired the shares of the other co-owners of the lot by extraordinary acquisitive prescription through continuous, open, peaceful, and adverse possession thereof in the concept of an owner since 1949.7 By way of Reply and Answer to the Defendants' Counterclaim, 8 herein respondents Gaudencio, Maximo, Flaviano, Domingo, and Victoria alleged that the deeds of sale on which Rosendo and Rodrigo base their claim of ownership of portions of the lot are spurious, but assuming that they are not, laches had set in against Alipio, Sr.; and that the shares of the other co-owners of the lot cannot be acquired through laches or prescription. Gaudencio, Maximo, Flaviano, Domingo, and Victoria, with leave of court, 9 filed an Amended Complaint10 impleading as additional defendants Alipio, Sr.'s other heirs, namely, petitioners Marceliana 11 Doblas, Terolio Bacalso, Alipio Bacalso, Jr., Mario Bacalso, William Bacalso, Alipio Bacalso III, and Christine B. Baes.12 Still later, Gaudencio et al. filed a Second Amended Complaint13 with leave of court,14 impleading as additional plaintiffs the other heirs of registered co-owner Maximiano, namely, herein respondents Timoteo Padigos, Perfecto Padigos, Frisca 15 Salarda, Flora Quinto (sometimes rendered as "Guinto"), Benita Templa, Sotero Padigos, Andres Padigos, and Emilio Padigos. 16 In their Answer to the Second Amended Complaint,17 petitioners contended that the Second Amended Complaint should be dismissed in view of the failure to implead other heirs of the other registered owners of the lot who are indispensable parties.18 A Third Amended Complaint19 was thereafter filed with leave of court20 impleading as additional plaintiffs the heirs of Wenceslao, namely, herein respondents Demetrio Padigos, Jr., Wenceslao Padigos, and Nelly Padigos, and the heirs of Felix, namely, herein respondents Expedito Padigos (Expedito), Henry Padigos, and Enrique P. Malazarte.21 After trial, Branch 16 of the Cebu City RTC decided22 in favor in the therein plaintiffs-herein respondents, disposing as follows: WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiffs and against the defendants. 1. Declaring the plaintiffs to be entitled to the ownership and possession of the lot in litigation;

2. Declaring as null and void the Deeds of Absolute Sale in question; 3. Ordering the defendants to pay plaintiffs the sum of P50,000.00 as actual and compensatory damages[,] the sum of P20,000.00 as attorney's fees, and P10,000.00 as litigation expenses. 4. Ordering the defendants to pay the costs of suit. SO ORDERED.23 (Emphasis in the original; underscoring supplied) The defendants-herein petitioners Bacalsos appealed.24 Meanwhile, the trial court, on respondents' Motion for Execution Pending Appeal, 25 issued a writ of execution which was implemented by, among other things, demolishing the houses constructed on the lot. 26 By Decision27 of September 6, 2005, the Court of Appeals affirmed the trial court's decision. Their Motion for Reconsideration28 having been denied,29 petitioners filed the present Petition for Review on Certiorari,30 faulting the Court of Appeals: . . . when it ruled that the Second Amended Complaint is valid and legal, even if not all indispensable parties are impleaded or joined . .. . . . when [it] wittingly overlooked the most potent, unescapable and indubitable fact or circumstance which proved the continuous possession of Lot No. 3781 by the defendants and their predecessors in interest, Alipio Bacalso [Sr.] and/or when it sanctioned impliedly the glaring arbitrary RTC order of the demolition of the over 40 years old houses, situated on Lot No. 3781 Cebu Cad., belonging to the old lessees, long allowed to lease or stay thereat for many years, by Alipio Bacalso [Sr.], father and [predecessor] in interest of the defendants, now the herein Petitioners. The said lessees were not even joined as parties in this case, much less were they given a chance to air their side before their houses were demolished, in gross violation of the due process clause provided for in Sec. 1[,] Art. III of the Constitution . . . . . . in upholding as gospel truth the report and conclusion of Nimrod Vao, the supposed handwriting expert [,] that signatures and thumb marks appearing on all documents of sale presented by the defendants are forgeries, and not mindful that Nimrod Vao was not cross-examined thoroughly by the defense counsel as he was prevented from doing so by the trial judge, in violation of the law more particularly Sec. 6, Rule 132, Rules of Court and/or the accepted and usual course of judicial proceedings and is therefore not admissible in evidence. . . . [when it] . . . wittingly or unwittingly, again overlooked the vital facts, the circumstances, the laws and rulings of the Supreme Court, which are of much weight, substance and influence which, if considered carefully, undoubtedly uphold that the defendants and their predecessors in interests, have long been in continuous, open, peaceful and adverse, and notorious possession against the whole world of Lot No. 3781, Cebu Cad., in concept of absolute owners for 46 years, a period more than sufficient to sustain or uphold the defense of prescription, provided for in Art. 1137 of the Civil Code even without good faith. 31 (Emphasis and underscoring in the original; italics supplied) Respondents admit that Teodulfo Padigos (Teodulfo), an heir of Simplicio, was not impleaded. 32 They contend, however, that the omission did not deprive the trial court of jurisdiction because Article 487 of the Civil Code states that "[a]ny of the co-owners may bring an action in ejectment."33

Respondents' contention does not lie. The action is for quieting of title, declaration of nullity of documents, recovery of possession and ownership, and damages. Arcelona v. Court of Appeals34 defines indispensable parties under Section 7 of Rule 3, Rules of Court as follows: [P]arties-in-interest without whom there can be no final determination of an action. As such, they must be joined either as plaintiffs or as defendants. The general rule with reference to the making of parties in a civil action requires, of course, the joinder of all necessary parties where possible, and the joinder of all indispensable parties under any and all conditions, their presence being a sine qua non for the exercise of judicial power. It is precisely "when an indispensable party is not before the court (that) the action should be dismissed." The absence of an indispensable party renders all subsequent actions of the court null and void for want of authority to act, not only as to the absent parties but even as to those present. Petitioners are co-owners of a fishpond . . . The fishpond is undivided; it is impossible to pinpoint which specific portion of the property is owned by Olanday, et. al. and which portion belongs to petitioners. x x x Indeed, petitioners should have been properly impleaded as indispensable parties. x x x x x x x35 (Underscoring supplied) The absence then of an indispensable party renders all subsequent actions of a court null and void for want of authority to act, not only as to the absent party but even as to those present.36 Failure to implead indispensable parties aside, the resolution of the case hinges on a determination of the authenticity of the documents on which petitioners in part anchor their claim to ownership of the lot. The questioned documents are: 1. Exhibit "3" a notarized Deed of Sale executed by Gaudencio, Domingo, a certain Hermenegilda Padigos, and the heirs of Fortunata, in favor of Alipio, Sr. on June 8, 1959; 2. Exhibit "4" a notarized Deed of Sale executed on September 9, 1957 by Gavino Padigos (Gavino), alleged son of Felix, in favor of Alipio Gadiano; 3. Exhibit "5" a private deed of sale executed in June 1957 by Macaria Bongalan, Marciano Padigos, and Dominga Padigos, supposed heirs of Wenceslao, in favor of Alipio, Sr.; 4. Exhibit "6" a notarized deed of sale executed on September 9, 1957 by Gavino and Rodulfo Padigos, heirs of Geronimo, in favor of Alipio Gadiano; 5. Exhibit "7" a notarized deed of sale executed on March 19, 1949 by Irenea Mabuyo, Teodulfo and Maximo, heirs of Simplicio; 6. Exhibit "8" a private deed of sale executed on May 3, 1950 by Candido Padigos, one of Simplicio's children, in favor of Alipio, Sr.; and 7. Exhibit "9" a notarized deed of sale executed on May 17, 1957 by Alipio Gadiano in favor of Alipio, Sr. Exhibits "3," "4," "6," "7," and "8," which are notarized documents, have in their favor the presumption of regularity. 37

Forgery, as any other mechanism of fraud, must be proved clearly and convincingly, and the burden of proof lies on the party alleging forgery.38 The trial court and the Court of Appeals relied on the findings of Nimrod Bernabe Vao (Vao), expert witness for respondents, that Gaudencio's signature on Exhibit "3" (Deed of Absolute Sale covering Fortunata's share in the lot) and Maximo's thumbprint on Exhibit "7" (Deed of Sale covering Simplicio's share in the lot) are spurious. 39 Vao's findings were presented by respondents to rebut those of Wilfredo Espina (Espina), expert witness for petitioners, that Gaudencio's signature and Maximo's thumbprint are genuine. 40 Expert opinions are not ordinarily conclusive. They are generally regarded as purely advisory in character.41 The courts may place whatever weight they choose upon and may reject them, if they find them inconsistent with the facts in the case or otherwise unreasonable.42 When faced with conflicting expert opinions, courts give more weight and credence to that which is more complete, thorough, and scientific.43 The Court observes that in examining the questioned signatures of respondent Gaudencio, petitioners' expert witness Espina used as standards 15 specimen signatures which have been established to be Gaudencio's, 44 and that after identifying similarities between the questioned signatures and the standard signatures, he concluded that the questioned signatures are genuine. On the other hand, respondents' expert witness Vao used, as standards, the questioned signatures themselves. 45 He identified characteristics of the signatures indicating that they may have been forged. Vao's statement of the purpose of the examination is revealing: x x x [t]o x x x discover, classify and determine the authenticity of every document that for any reason requires examination be [sic] scrutinized in every particular that may possibly throw any light upon its origin, its age or upon quality element or condition that may have a bearing upons [sic] its genuineness or spuriousness.46 (Emphasis supplied) The Court also notes that Vao also analyzed the signatures of the witnesses to the questioned documents, the absence of standard specimens with which those signatures could be compared notwithstanding. 47 On the other hand, Espina refrained from making conclusions on signatures which could not be compared with established genuine specimens. 48 Specifically with respect to Vao's finding that Maximo's thumbprint on Exhibit "7" is spurious, the Court is not persuaded, no comparison having been made of such thumbprint with a genuine thumbprint established to be Maximo's. 49 Vao's testimony should be received with caution, the trial court having abruptly cut short his cross-examination conducted by petitioners' counsel,50 thus: COURT: You are just delaying the proceedings in this case if you are going to ask him about the documents one by one. Just leave it to the Court to determine whether or not he is a qualified expert witness. The Court will just go over the Report of the witness. You do not have to ask the witness one by one on the document,51 thereby depriving this Court of the opportunity to determine his credibility. Espina, on the other hand, withstood thorough cross-examination, re-direct and re-cross examination.52

The value of the opinion of a handwriting expert depends not upon his mere statements of whether a writing is genuine or false, but upon the assistance he may afford in pointing out distinguishing marks, characteristics and discrepancies in and between genuine and false specimens of writing which would ordinarily escape notice or detection from an unpracticed observer. 53 While differences exist between Gaudencio's signatures appearing on Exhibits "3"-"3-D" and his signatures appearing on the affidavits accompanying the pleadings in this case, 54 the gap of more than 30 years from the time he affixed his signatures on the questioned document to the time he affixed his signatures on the pleadings in the case could explain the difference. Thus Espina observed: xxxx 4. Both questioned and standard signatures exhibited the same style and form of the movement impulses in its execution; 5. Personal habits of the writer were established in both questioned and standard signatures such as misalignment of the whole structure of the signature, heavy penpressure [sic] of strokes from initial to the terminal, formation of the loops and ovals, poor line quality and spacing between letters are all repeated; 6. Both questioned and standard signatures [show] no radical change in the strokes and letter formation in spite o[f] their wide difference in dates of execution considering the early writing maturity of the writer; 7. Variations in both writings questioned and standards were considered and properly evaluated. xxxx Fundamental similarities are observed in the following characteristics to wit: xxxx SIGNATURES 1. Ovals of "a" either rounded or angular at the base; 2. Ovals of "d" either narrow, rounded, or angular at the base; 3. Loop stems of "d" consistently tall and retraced in both specimens questioned and standards; 4. Base alignment of "e" and "i" are repeated with sameness; 5. Top of "c" either with a retrace, angular formation or an eyelet; 6. Terminal ending of "o" heavy with a short tapering formation; 7. Loop stem of "P" with wide space and angular;

8. Oval of "P" either rounded or multi-angular; 9. Base loop of "g" consistently short either a retrace, a blind loop or narrow space disproportionate to the top oval; 10. Angular top of "s" are repeated with sameness; 11. Terminal ending of "s" short and heavy with blind loop or retrace at the base. And Espina concluded xxxx [t]hat the four (4) questioned signatures over and above the typewritten name and word GAUDENCIO PADIGOS Vendor on four copies of a DEED OF ABSOLUTE SALE (original and carbon) dated June 8, 1959 were written, signed, and prepared by the hand who wrote the standard specimens Exh. "G" and other specimen materials collected from the records of this case that were submitted or comparison; a product of one Mind and Brain hence GENUINE and AUTHENTIC.56 (Emphasis in the original; underscoring supplied) Respondents brand Maximo's thumbmark on Exhibit "7" as spurious because, so they claim, Maximo did not affix his signature thru a thumbmark, he knowing how to write.57 Such conclusion is a non sequitur, however, for a person who knows how to write is not precluded from signing by thumbmark. In affirming the nullification by the trial court of Exhibits "3," "4," "5," "6," "7," and "8," the Court of Appeals held: xxxx First of all, facts about pedigree of the registered owners and their lawful heirs were convincingly testified to by plaintiff-appellant Gaudencio Padigos and his testimony remained uncontroverted. xxxx Giving due weight to his testimony, we find that x x x the vendors in the aforesaid Deeds of Sale x x x were not the legal heirs of the registered owners of the disputed land. x x x xxxx As for Exhibit "4," the vendor Gavino Padigos is not a legal heir of the registered owner Felix Padigos. The latter's heirs are plaintiffappellants Expedito Padigos, Henry Padigos and Enrique P. Malazarte. Accordingly, Exhibit "4" is a patent nullity and did not vest title of Felix Padigos' share of Lot 3781 to Alipio [Gadiano]. As for Exhibit "6," the vendors Gavino and Rodulfo Padigos are not the legal heirs of the registered owner Geronimo Padigos. Therefore, these fictitious heirs could not validly convey ownership in favor of Alipio [Gadiano].
55

xxxx As for Exhibit "8," the vendor Candido Padigos is not a legal heir of Simplicio Padigos. Therefore, the former could not vest title of the land to Alipio Bacalso. As for Exhibit "3," the vendors Gaudencio Padigos, Hermenegilda Padigos and Domingo Padigos are not the legal heirs of registered owner Fortunata Padigos. Hermenegilda Padigos is not a known heir of any of the other registered owners of the property. On the other hand, plaintiffs-appellants Gaudencio and Domingo Padigos are only some of the collateral grandchildren of Fortunata Padigos. They could not by themselves dispose of the share of Fortunata Padigos. xxxx As for Exhibit "5," the vendors in Exhibit "5" are not the legal heirs of Wenceslao Padigos. The children of registered owner Wenceslao Padigos are: Wenceslao Padigos, Demetrio Padigos and Nelly Padigos. Therefore, Exhibit "5" is null and void and could not convey the shares of the registered owner Wenceslao Padigos in favor of Alipio Bacalso. As for Exhibit "9," the Deed of Sale executed by Alipio [Gadiano] in favor of Alipio Bacalso is also void because the shares of the registered owners Felix and Geronimo Padigos were not validly conveyed to Alipio [Gadiano] because Exhibit "4" and "6" were void contracts. Thus, Exhibit "9" is also null and void.58 (Italics in the original; underscoring supplied) The evidence regarding the "facts of pedigree of the registered owners and their heirs" does not, however, satisfy this Court. Not only is Gaudencio's self-serving testimony uncorroborated; it contradicts itself on material points. For instance, on direct examination, he testified that Ignacio is his father and Fortunata is his grandmother.59 On cross-examination, however, he declared that his father Ignacio is the brother of Fortunata.60 On direct examination, he testified that his co-plaintiffs Victoria and Lilia are already dead.61 On cross-examination, however, he denied knowledge whether the two are already dead.62 Also on direct examination, he identified Expedito, Henry, and Enrique as the children of Felix.63 Expedito himself testified, however, that he is the son of a certain Mamerto Padigos, the son of a certain Apolonio Padigos who is in turn the son of Felix.64 At all events, respondents are guilty of laches the negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert it has either abandoned it or declined to assert it.65 While, by express provision of law, no title to registered land in derogation of that of the registered owner shall be acquired by prescription or adverse possession, it is an enshrined rule that even a registered owner may be barred from recovering possession of property by virtue of laches. 66 Respondents insist, however, that they only learned of the deeds of sale in 1994, the year that Alipio, Sr. allegedly commenced possession of the property.67 The record shows, however, that although petitioners started renting out the land in 1994, they have been tilling it since the 1950s,68 and Rosendo's house was constructed in about 1985.69 These acts of possession could not have escaped respondents' notice given the following unassailed considerations, inter alia: Gaudencio testified that he lived on the lot from childhood until 1985, after which he moved to a place three kilometers away, and after he moved, a certain Vicente Debelos lived on the lot with his permission. 70 Petitioners' witness Marina Alcoseba, their employee,71 testified that Gaudencio and Domingo used to cut kumpay planted by petitioners' tenant on the lot.72 The tax declarations in Alipio, Sr.'s name for the years 1967-1980 covering a portion of the lot indicate Fortunata's share to be the north and east boundaries of Alipio, Sr.'s;73 hence, respondents could not have been unaware of the acts of possession that petitioners exercised over the lot.

Upon the other hand, petitioners have been vigilant in protecting their rights over the lot, which their predecessor-in-interest Alipio, Sr. had declared in his name for tax purposes as early as 1960, and for which he had been paying taxes until his death in 1994, by continuing to pay the taxes thereon.74 Respondents having failed to establish their claim by preponderance of evidence, their action for quieting of title, declaration of nullity of documents, recovery of possession, and damages must fail. A final word. While petitioners' attribution of error to the appellate court's "implied sanction" of the trial court's order for the demolition pending appeal of the houses of their lessees is well taken, the Court may not consider any grant of relief to them, they not being parties to the case. WHEREFORE, the petition is GRANTED. The September 6, 2005 decision of the Court of Appeals is REVERSED and SET ASIDE. Civil Case No. CEB-17326 of Branch 16 of the Regional Trial Court of Cebu City is DISMISSED. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION A.M. No. 1053 September 7, 1979 SANTA PANGAN, complainant vs. ATTY. DIONISIO RAMOS, respondent, RESOLUTION ANTONIO, J.: This has reference to the motion of complainant, Santa Pangan, to cite respondent Dionisio Ramos for contempt. It appears from the record that on September 7, 1978 and March 13, 1979, the hearings in this administrative case were postponed on the basis of respondent's motions for postponement. These motions were predicated on respondent's allegations that on said dates he had a case set for hearing before Branch VII, Court of First Instance of Manila, entitled People v. Marieta M. Isip (Criminal Case No. 35906). Upon verification, the attorney of record of the accused in said case is one "Atty. Pedro D.D. Ramos, 306 Dona Salud Bldg., Dasmarinas Manila." Respondent admits that he used the name of "Pedro D.D. Ramos" before said court in connection with Criminal Case No. 35906, but avers that he had a right to do so because in his Birth Certificate (Annex "A"), his name is "Pedro Dionisio Ramos", and -his parents are Pedro Ramos and Carmen Dayaw, and that the D.D. in "Pedro D.D. Ramos" is but an abbreviation of "Dionisio Dayaw his other given name and maternal surname. This explanation of respondent is untenable. The name appearing in the "Roll of Attorneys" is "Dionisio D. Ramos". The attorney's roll or register is the official record containing the names and signatures of those who are authorized to practice law. A lawyer is not authorized to use a name other than the one inscribed in the Roll of Attorneys in his practice of law. The official oath obliges the attorney solemnly to swear that he will do no falsehood". As an officer in the temple of justice, an attorney has irrefragable obligations of "truthfulness, candor and frankness". 1 Indeed, candor and frankness should characterize the conduct of the lawyer at every stage. This has to be so because the court has the right to rely upon him in ascertaining the truth. In representing himself to the court as "Pedro D.D. Ramos" instead of "Dionisio D. Ramos", respondent has violated his solemn oath. The duty of an attorney to the courts to employ, for the purpose of maintaining the causes confided to him, such means as are consistent with truth and honor cannot be overempahisized. These injunctions circumscribe the general duty of entire devotion of the attorney to the client. As stated in a case, his I nigh vocation is to correctly inform the court upon the law and the facts of the case, and to aid it in doing justice and arriving at correct conclusions. He violates Ms oath of office ,when he resorts to deception or permits his client to do so." 2 In using the name of' Pedro D.D. Ramos" before the courts instead of the name by which he was authorized to practice law - Dionisio D. Ramos - respondent in effect resorted to deception. The demonstrated lack of candor in dealing with the courts. The circumstance that this is his first aberration in this regard precludes Us from imposing a more severe penalty.

WHEREFORE, in view of the foregoing, respondent Dionisio D. Ramos is severely REPRIMANDED and warned that a repetition of the same overt act may warrant his suspencion or disbarment from the practice of law. It appearing that the hearing of this case has been unduly delayed, the Investigator of this Court is directed forthwith to proceed with the hearing to terminate it as soon as possible. The request of complainant to appear in the afore-mentioned hearing, assisted by her counsel, Atty. Jose U. Lontoc, is hereby granted. SO ORDERED

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. 149576 August 8, 2006 REPUBLIC OF THE PHILIPPINES, represented by the Land Registration Authority, Petitioner, vs. KENRICK DEVELOPMENT CORPORATION, Respondent. DECISION CORONA, J.: The Republic of the Philippines assails the May 31, 2001 decision 1 and August 20, 2001 resolution of the Court of Appeals in CA-G.R. SP No. 52948 in this petition for review under Rule 45 of the Rules of Court. This case stemmed from the construction by respondent Kenrick Development Corporation of a concrete perimeter fence around some parcels of land located behind the Civil Aviation Training Center of the Air Transportation Office (ATO) in 1996. As a result, the ATO was dispossessed of some 30,228 square meters of prime land. Respondent justified its action with a claim of ownership over the property. It presented Transfer Certificate of Title (TCT) Nos. 135604, 135605 and 135606 issued in its name and which allegedly originated from TCT No. 17508 registered in the name of one Alfonso Concepcion. ATO verified the authenticity of respondents titles with the Land Registration Authority (LRA). On May 17, 1996, Atty. Jose Loriega, head of the Land Title Verification Task Force of the LRA, submitted his report. The Registrar of Deeds of Pasay City had no record of TCT No. 17508 and its ascendant title, TCT No. 5450. The land allegedly covered by respondents titles was also found to be within Villamor Air Base (headquarters of the Philippine Air Force) in Pasay City. By virtue of the report, the Office of the Solicitor General (OSG), on September 3, 1996, filed a complaint for revocation, annulment and cancellation of certificates of title in behalf of the Republic of the Philippines (as represented by the LRA) against respondent and Alfonso Concepcion. It was raffled to Branch 114 of the Regional Trial Court of Pasay City where it was docketed as Civil Case No. 96-1144. On December 5, 1996, respondent filed its answer which was purportedly signed by Atty. Onofre Garlitos, Jr. as counsel for respondent. Since Alfonso Concepcion could not be located and served with summons, the trial court ordered the issuance of an alias summons by publication against him on February 19, 1997. The case was thereafter punctuated by various incidents relative to modes of discovery, pre-trial, postponements or continuances, motions to dismiss, motions to declare defendants in default and other procedural matters.

During the pendency of the case, the Senate Blue Ribbon Committee and Committee on Justice and Human Rights conducted a hearing in aid of legislation on the matter of land registration and titling. In particular, the legislative investigation looked into the issuance of fake titles and focused on how respondent was able to acquire TCT Nos. 135604, 135605 and 135606. During the congressional hearing held on November 26, 1998, one of those summoned was Atty. Garlitos, respondents former cou nsel. He testified that he prepared respondents answer and transmitted an unsigned draft to respondents president, Mr. Victor Ong. The signature appearing above his name was not his. He authorized no one to sign in his behalf either. And he did not know who finally signed it. With Atty. Garlitos revelation, the Republic promptly filed an urgent motion on December 3, 1998 to declare respondent in default, 2 predicated on its failure to file a valid answer. The Republic argued that, since the person who signed the answer was neither authorized by Atty. Garlitos nor even known to him, the answer was effectively an unsigned pleading. Pursuant to Section 3, Rule 7 of the Rules of Court, 3 it was a mere scrap of paper and produced no legal effect. On February 19, 1999, the trial court issued a resolution granting the Republics motion. 4 It found respondents answer to be sham and false and intended to defeat the purpose of the rules. The trial court ordered the answer stricken from the records, declared respondent in default and allowed the Republic to present its evidence ex parte. The Republic presented its evidence ex parte, after which it rested its case and formally offered its evidence. Meanwhile, respondent sought reconsideration of the February 19, 1999 resolution but the trial court denied it. Aggrieved, respondent elevated the matter to the Court of Appeals via a petition for certiorari 5 seeking to set aside the February 19, 1999 resolution of the trial court. Respondent contended that the trial court erred in declaring it in default for failure to file a valid and timely answer. On May 31, 2001, the Court of Appeals rendered the assailed decision. It found Atty. Garlitos statements in the legislative hearing to be unreliable since they were not subjected to cross-examination. The appellate court also scrutinized Atty. Garlitos acts after the filing of the answer 6 and concluded that he assented to the signing of the answer by somebody in his stead. This supposedly cured whatever defect the answer may have had. Hence, the appellate court granted respondents petition for certiorari. It directed the lifting of the order of default against respondent and ordered the trial court to proceed to trial with dispatch. The Republic moved for reconsideration but it was denied. Thus, this petition. Did the Court of Appeals err in reversing the trial courts order which declared respondent in default for its failure to file a valid answer? Yes, it did. A party may, by his words or conduct, voluntarily adopt or ratify anothers statement. 7 Where it appears that a party clearly and unambiguously assented to or adopted the statements of another, evidence of those statements is admissible against him. 8 This is the essence of the principle of adoptive admission. An adoptive admission is a partys reaction to a statement or action by another person when it is reasonable to treat the partys reaction as an admission of something stated or implied by the other person. 9 By adoptive admission, a third persons statement becomes the admission of the party embracing or espousing it. Adoptive admission may occur when a party:

(a) expressly agrees to or concurs in an oral statement made by another; (b) hears a statement and later on essentially repeats it;
11

10

(c) utters an acceptance or builds upon the assertion of another;

12

(d) replies by way of rebuttal to some specific points raised by another but ignores further points which he or she has heard the other make or (e) reads and signs a written statement made by another.
14

13

Here, respondent accepted the pronouncements of Atty. Garlitos and built its case on them. At no instance did it ever deny or contradict its former counsels statements. It went to great lengths to explain Atty. Garlitos testimony as well as its implications, as fo llows: 1. While Atty. Garlitos denied signing the answer, the fact was that the answer was signed. Hence, the pleading could not be considered invalid for being an unsigned pleading. The fact that the person who signed it was neither known to Atty. Garlitos nor specifically authorized by him was immaterial. The important thing was that the answer bore a signature. 2. While the Rules of Court requires that a pleading must be signed by the party or his counsel, it does not prohibit a counsel from giving a general authority for any person to sign the answer for him which was what Atty. Garlitos did. The person who actually signed the pleading was of no moment as long as counsel knew that it would be signed by another. This was similar to addressing an authorization letter "to whom it may concern" such that any person could act on it even if he or she was not known beforehand. 3. Atty. Garlitos testified that he prepared the answer; he never disowned its contents and he resumed acting as counsel for respondent subsequent to its filing. These circumstances show that Atty. Garlitos conformed to or ratified the signing of the answer by another. Respondent repeated these statements of Atty. Garlitos in its motion for reconsideration of the trial courts February 19, 19 99 resolution. And again in the petition it filed in the Court of Appeals as well as in the comment 15 and memorandum it submitted to this Court. Evidently, respondent completely adopted Atty. Garlitos statements as its own. Respondents adoptive admission consti tuted a judicial admission which was conclusive on it. Contrary to respondents position, a signed pleading is one that is signed either by the party himself or his counsel. Sectio n 3, Rule 7 is clear on this matter. It requires that a pleading must be signed by the party or counsel representing him. Therefore, only the signature of either the party himself or his counsel operates to validly convert a pleading from one that is unsigned to one that is signed. Counsels authority and duty to sign a pleading are personal to him. He may not delegate it to just any person.

The signature of counsel constitutes an assurance by him that he has read the pleading; that, to the best of his knowledge, information and belief, there is a good ground to support it; and that it is not interposed for delay. 16 Under the Rules of Court, it is counsel alone, by affixing his signature, who can certify to these matters. The preparation and signing of a pleading constitute legal work involving practice of law which is reserved exclusively for the members of the legal profession. Counsel may delegate the signing of a pleading to another lawyer 17 but cannot do so in favor of one who is not. The Code of Professional Responsibility provides: Rule 9.01 A lawyer shall not delegate to any unqualified person the performance of any task which by l aw may only be performed by a member of the Bar in good standing. Moreover, a signature by agents of a lawyer amounts to signing by unqualified persons,
18

something the law strongly proscribes.

Therefore, the blanket authority respondent claims Atty. Garlitos entrusted to just anyone was void. Any act taken pursuant to that authority was likewise void. There was no way it could have been cured or ratified by At ty. Garlitos subsequent acts. Moreover, the transcript of the November 26, 1998 Senate hearing shows that Atty. Garlitos consented to the signing of the answer by another "as long as it conformed to his draft." We give no value whatsoever to such self-serving statement. No doubt, Atty. Garlitos could not have validly given blanket authority for just anyone to sign the answer. The trial court correctly ruled that respondents answer was invalid and of no legal effect as it was an unsigned pleading. Respondent was properly declared in default and the Republic was rightly allowed to present evidence ex parte. Respondent insists on the liberal application of the rules. It maintains that even if it were true that its answer was supposedly an unsigned pleading, the defect was a mere technicality that could be set aside. Procedural requirements which have often been disparagingly labeled as mere technicalities have their own valid raison d etre in the orderly administration of justice. To summarily brush them aside may result in arbitrariness and injustice. 19 The Courts pronouncement in Garbo v. Court of Appeals
20

is relevant:

Procedural rules are [tools] designed to facilitate the adjudication of cases. Courts and litigants alike are thus [enjoined] to abide strictly by the rules. And while the Court, in some instances, allows a relaxation in the application of the rules, this, we stress, was never intended to forge a bastion for erring litigants to violate the rules with impunity. The liberality in the interpretation and application of the rules applies only in proper cases and under justifiable causes and circumstances. While it is true that litigation is not a game of technicalities, it is equally true that every case must be prosecuted in accordance with the prescribed procedure to insure an orderly and speedy administration of justice. Like all rules, procedural rules should be followed except only when, for the most persuasive of reasons, they may be relaxed to relieve a litigant of an injustice not commensurate with the degree of his thoughtlessness in not complying with the prescribed procedure. 21 In this case, respondent failed to show any persuasive reason why it should be exempted from strictly abiding by the rules.

As a final note, the Court cannot close its eyes to the acts committed by Atty. Garlitos in violation of the ethics of the legal profession. Thus, he should be made to account for his possible misconduct. WHEREFORE, the petition is hereby GRANTED. The May 31, 2001 decision and August 20, 2001 resolution of the Court of Appeals in CAG.R. SP No. 52948 are REVERSED and SET ASIDE and the February 19, 1999 resolution of the Regional Trial Court of Pasay City, Branch 114 declaring respondent in default is hereby REINSTATED. Let a copy of this decision be furnished the Commission on Bar Discipline of the Integrated Bar of the Philippines for the commencement of disbarment proceedings against Atty. Onofre Garlitos, Jr. for his possible unprofessional conduct not befitting his position as an officer of the court. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila THIRD DIVISION A.C. No. 5921 March 10, 2006

JUDGE UBALDINO A. LACUROM, Presiding Judge, Regional Trial Court, Cabanatuan City, Branch 29 and Pairing Judge, Branch 30, Complainant, vs. ATTY. ELLIS F. JACOBA and ATTY. OLIVIA VELASCO-JACOBA, Respondents. DECISION CARPIO, J.: The Case This administrative case arose from a complaint filed on 22 October 2001 by Judge Ubaldino A. Lacurom ("Judge Lacurom"), Pairing Judge, Regional Trial Court of Cabanatuan City, Branch 30, against respondent-spouses Atty. Ellis F. Jacoba and Atty. Olivia Velasco-Jacoba ("respondents"). Complainant charged respondents with violation of Rules 11.03,1 11.04,2 and 19.013 of the Code of Professional Responsibility. The Facts The Jacoba-Velasco-Jacoba Law Firm is counsel for plaintiff Alejandro R. Veneracion ("Veneracion") in a civil case for unlawful detainer against defendant Federico Barrientos ("Barrientos").4 The Municipal Trial Court of Cabanatuan City rendered judgment in favor of Veneracion but Barrientos appealed to the Regional Trial Court. The case was raffled to Branch 30 where Judge Lacurom was sitting as pairing judge. On 29 June 2001, Judge Lacurom issued a Resolution ("Resolution") reversing the earlier judgments rendered in favor of Veneracion.5 The dispositive portion reads: WHEREFORE, this Court hereby REVERSES its Decision dated December 22, 2000, as well as REVERSES the Decision of the court a quo dated July 22, 1997. Furthermore, the plaintiff-appellee Alejandro Veneracion is ordered to CEASE and DESIST from ejecting the defendant-appellant Federico Barrientos from the 1,000 square meter homelot covered by TCT No. T-75274, and the smaller area of one hundred forty-seven square meters, within the 1,000 sq.m. covered by TCT No. T-78613, and the house thereon standing covered by Tax Declaration No. 02006-01137, issued by the City Assessor of Cabanatuan City; and Barrientos is ordered to pay Veneracion P10,000.00 for the house covered by Tax Declaration No. 02006-01137.

SO ORDERED.6 Veneracions counsel filed a Motion for Reconsideration (with Request for Inhibition)7 dated 30 July 2001 ("30 July 2001 motion"), pertinent portions of which read: II. PREFATORY STATEMENT This RESOLUTION of REVERSAL is an ABHORRENT NULLITY as it is entirely DEVOID of factual and legal basis. It is a Legal MONSTROSITY in the sense that the Honorable REGIONAL TRIAL COURT acted as if it were the DARAB (Dept. of Agrarian Reform ADJUDICATION BOARD)! x x x HOW HORRIBLE and TERRIBLE! The mistakes are very patent and glaring! x x x xxxx III. GROUNDS FOR RECONSIDERATION 1. The Honorable Pairing Court Presiding Judge ERRED in Peremptorily and Suddenly Reversing the Findings of the Lower Court Judge and the Regular RTC Presiding Judge:1awph!l.net x x x The defendant filed a Motion for Reconsideration, and after a very questionable SHORT period of time, came this STUNNING and SUDDEN REVERSAL. Without any legal or factual basis, the Hon. Pairing Judge simply and peremptorily REVERSED two (2) decisions in favor of the plaintiff. This is highly questionable, if not suspicious, hence, this Motion for Reconsideration. xxxx [The Resolution] assumes FACTS that have not been established and presumes FACTS not part of the records of the case, all "loaded" in favor of the alleged "TENANT." Clearly, the RESOLUTION is an INSULT to the Judiciary and an ANACHRONISM in the Judicial Process. Need we say more? xxxx 4. The Honorable Pairing Court Presiding Judge ERRED in Holding That the Defendant is Entitled to a Homelot, and That the Residential LOT in Question is That Homelot: THIS ERROR IS STUPENDOUS and a real BONER. Where did the Honorable PAIRING JUDGE base this conclusion? x x x This HORRENDOUS MISTAKE must be corrected here and now! xxxx 6. The Honorable Pairing Court Presiding Judge ERRED Grievously in Holding and Declaring that The [court] A QUO Erroneously Took Cognizance of the Case and That It Had No Jurisdiction over the Subject-Matter:

Another HORRIBLE ERROR! Even an average Law Student knows that JURISDICTION is determined by the averments of the COMPLAINT and not by the averments in the answer! This is backed up by a Litany of Cases! xxxx 7. FINALLY, the Honorable Pairing Court Presiding Judge Ridiculously ERRED in Ordering the Defendant To Pay P10,000.00 to the Plaintiff As Payment for Plaintiffs HOUSE: THIS IS the Last STRAW, but it is also the Best ILLUSTRATION of the Manifold GLARING ERRORS committed by the Hon. Pairing Court Judge. xxxx This Order of the Court for the plaintiff to sell his RESIDENTIAL HOUSE to the defendant for the ridiculously LOW price of P10,000.00 best illustrates the Long Line of Faulty reasonings and ERRONEOUS conclusions of the Hon. Pairing Court Presiding Judge. Like the proverbial MONSTER, the Monstrous Resolution should be slain on sight!8 The 30 July 2001 motion prayed that (1) Judge Lacurom inhibit himself "in order to give plaintiff a fighting chance" and (2) the Resolution be reconsidered and set aside.9 Atty. Olivia Velasco-Jacoba ("Velasco-Jacoba") signed the motion on behalf of the Jacoba-Velasco-Jacoba Law Firm. On 6 August 2001, Judge Lacurom ordered Velasco-Jacoba to appear before his sala and explain why she should not be held in contempt of court for the "very disrespectful, insulting and humiliating" contents of the 30 July 2001 motion. 10 In her Explanation, Comments and Answer,11 Velasco-Jacoba claimed that "His Honor knows beforehand who actually prepared the subject Motion; records will show that the undersigned counsel did not actually or actively participate in this case."12 Velasco-Jacoba disavowed any "conscious or deliberate intent to degrade the honor and integrity of the Honorable Court or to detract in any form from the respect that is rightfully due all courts of justice." 13 She rationalized as follows: x x x at first blush, [the motion] really appears to contain some sardonic, strident and hard-striking adjectives. And, if we are to pick such stringent words at random and bunch them together, side-by-side x x x then collectively and certainly they present a cacophonic picture of total and utter disrespect. x x x xxxx We most respectfully submit that plaintiff & counsel did not just fire a staccato of incisive and hard-hitting remarks, machine-gun style as to be called contumacious and contemptuous. They were just articulating their feelings of shock, bewilderment and disbelief at the sudden reversal of their good fortune, not driven by any desire to just cast aspersions at the Honorable Pairing judge. They must believe that big monumental errors deserve equally big adjectives, no more no less. x x x The matters involved were [neither] peripheral nor marginalized, and they had to call a spade a spade. x x x14 Nevertheless, Velasco-Jacoba expressed willingness to apologize "for whatever mistake [they] may have committed in a moment of unguarded discretion when [they] may have stepped on the line and gone out of bounds." She also agreed to have the allegedl y contemptuous phrases stricken off the record.15

On 13 September 2001, Judge Lacurom found Velasco-Jacoba guilty of contempt and penalized her with imprisonment for five days and a fine of P1,000.16 Velasco-Jacoba moved for reconsideration of the 13 September 2001 order. She recounted that on her way out of the house for an afternoon hearing, Atty. Ellis Jacoba ("Jacoba") stopped her and said "O, pirmahan mo na ito kasi last day na, baka mahuli ." (Sign this as it is due today, or it might not be filed on time.) She signed the pleading handed to her without reading it, in "trusting blind faith" on her husband of 35 years with whom she "entrusted her whole life and future."17 This pleading turned out to be the 30 July 2001 motion which Jacoba drafted but could not sign because of his then suspension from the practice of law.18 Velasco-Jacoba lamented that Judge Lacurom had found her guilty of contempt without conducting any hearing. She accused Judge Lacurom of harboring "a personal vendetta," ordering her imprisonment despite her status as "senior lady lawyer of the IBP Nueva Ecija Chapter, already a senior citizen, and a grandmother many times over."19 At any rate, she argued, Judge Lacurom should have inhibited himself from the case out of delicadeza because "[Veneracion] had already filed against him criminal cases before the Office of the City Prosecutor of Cabanatuan City and before the Ombudsman."20 The records show that with the assistance of counsel Jacoba and the Jacoba-Velasco-Jacoba Law Firm, Veneracion had executed an affidavit on 23 August 2001 accusing Judge Lacurom of knowingly rendering unjust judgment through inexcusable negligence and ignorance 21 and violating Section 3(e) of Republic Act No. 3019 ("RA 3019"). 22 The first charge became the subject of a preliminary investigation 23 by the City Prosecutor of Cabanatuan City. On the second charge, Veneracion set forth his allegations in a Complaint-Affidavit24 filed on 28 August 2001 with the Office of the Deputy Ombudsman for Luzon. Judge Lacurom issued another order on 21 September 2001, this time directing Jacoba to explain why he should not be held in contempt.25 Jacoba complied by filing an Answer with Second Motion for Inhibition, wherein he denied that he typed or prepared the 30 July 2001 motion. Against Velasco-Jacobas statements implicating him, Jacoba invoked the marital privilege rule in evidence.26 Judge Lacurom later rendered a decision27 finding Jacoba guilty of contempt of court and sentencing him to pay a fine of P500. On 22 October 2001, Judge Lacurom filed the present complaint against respondents before the Integrated Bar of the Philippines (IBP). Report and Recommendation of the IBP Respondents did not file an answer and neither did they appear at the hearing set by IBP Commissioner Atty. Lydia A. Navarro ("IBP Commissioner Navarro") despite sufficient notice.28 IBP Commissioner Navarro, in her Report and Recommendation of 10 October 2002, recommended the suspension of respondents from the practice of law for six months.29 IBP Commissioner Navarro found that "respondents were prone to us[ing] offensive and derogatory remarks and phrases which amounted to discourtesy and disrespect for authority." 30 Although the remarks were not directed at Judge Lacurom personally, they were aimed at "his position as a judge, which is a smack on the judiciary system as a whole." 31

The IBP Board of Governors ("IBP Board") adopted IBP Commissioner Navarros Report and Recommendation, except for the length of suspension which the IBP Board reduced to three months.32 On 10 December 2002, the IBP Board transmitted its recommendation to this Court, together with the documents pertaining to the case. Several days later, Velasco-Jacoba sought reconsideration of the IBP Board decision, thus: 33 xxxx 3. For the information of the Honorable Commission, the present complaint of Judge Lacurom is sub judice; the same issues involved in this case are raised before the Honorable Court of Appeals presently pending in CA-G.R. SP No. 66973 for Certiorari and Mandatory Inhibition with TRO and Preliminary Injunction x x x; 4. We filed an Administrative Case against Judge Lacurom before the Supreme Court involving the same issues we raised in the aforementioned Certiorari case, which was dismissed by the Supreme Court for being premature, in view of the pending Certiorari case before the Court of Appeals; 5. In like manner, out of respect and deference to the Court of Appeals, the present complaint should likewise be dismissed and/or suspended pending resolution of the certiorari case by the Court of Appeals.34 (Emphasis supplied) The Courts Ruling On a preliminary note, we reject Velasco-Jacobas contention that the present complaint should be considered sub judice in view of the petition for certiorari and mandatory inhibition with preliminary injunction ("petition for certiorari") 35 filed before the Court of Appeals. The petition for certiorari, instituted by Veneracion and Velasco-Jacoba on 4 October 2001, seeks to nullify the following orders issued by Judge Lacurom in Civil Case No. 2836: (1) the Orders dated 26 September 2001 and 9 November 2001 denying respondents respect ive motions for inhibition; and (2) the 13 September 2001 Order which found Velasco-Jacoba guilty of contempt. The petitioners allege that Judge Lacurom acted "with grave abuse of discretion [amounting] to lack of jurisdiction, in violation of express provisions of the law and applicable decisions of the Supreme Court."36 Plainly, the issue before us is respondents liability under the Code of Professional Responsibil ity. The outcome of this case has no bearing on the resolution of the petition for certiorari, as there is neither identity of issues nor causes of action. Neither should the Courts dismissal of the administrative complaint against Judge Lacurom for being premature impel us to dismiss this complaint. Judge Lacuroms orders in Civil Case No. 2836 could not be the subject of an administrative complaint against him while a petition for certiorari assailing the same orders is pending with an appellate court. Administrative remedies are neither alternative nor cumulative to judicial review where such review is available to the aggrieved parties and the same has not been resolved with finality. Until there is a final declaration that the challenged order or judgment is manifestly erroneous, there will be no basis to conclude whether the judge is administratively liable.37 The respondents are situated differently within the factual setting of this case. The corresponding implications of their actions also give rise to different liabilities. We first examine the charge against Velasco-Jacoba.

There is no dispute that the genuine signature of Velasco-Jacoba appears on the 30 July 2001 motion. Velasco-Jacobas responsibility as counsel is governed by Section 3, Rule 7 of the Rules of Court: SEC. 3.Signature and address.Every pleading must be signed by the party or counsel representing him x x x. The signature of counsel constitutes a certificate by him that he has read the pleading, that to the best of his knowledge, information, and belief there is good ground to support it, and that it is not interposed for delay. x x x Counsel who x x x signs a pleading in violation of this Rule, or alleges scandalous or indecent matter therein x x x shall be subject to appropriate disciplinary action. (Emphasis supplied) By signing the 30 July 2001 motion, Velasco-Jacoba in effect certified that she had read it, she knew it to be meritorious, and it was not for the purpose of delaying the case. Her signature supplied the motion with legal effect and elevated its status from a mere scrap of paper to that of a court document. Velasco-Jacoba insists, however, that she signed the 30 July 2001 motion only because of her husbands request but she did not know its contents beforehand. Apparently, this practice of signing each others pleadings is a long -standing arrangement between the spouses. According to Velasco-Jacoba, "[s]o implicit is [their] trust for each other that this happens all the time. Through the years, [she] already lost count of the number of pleadings prepared by one that is signed by the other." 38 By Velasco-Jacobas own admission, therefore, she violated Section 3 of Rule 7. This violation is an act of falsehood before the courts, which in itself is a ground for subjecting her to disciplinary action, independent of any other ground arising from the contents of the 30 July 2001 motion.39 We now consider the evidence as regards Jacoba. His name does not appear in the 30 July 2001 motion. He asserts the inadmissibility of Velasco-Jacobas statement pointing to him as the author of the motion. The Court cannot easily let Jacoba off the hook. Firstly, his Answer with Second Motion for Inhibition did not contain a denial of his wifes account. Instead, Jacoba impliedly admitted authorship of the motion by stating that he "trained his guns and fired at the errors which he perceived and believed to be gigantic and monumental."40 Secondly, we find Velasco-Jacobas version of the facts more plausible, for two reasons: (1) her reaction to the events was imm ediate and spontaneous, unlike Jacobas defense which was raised only after a considerable time had elapsed from the eruption of the con troversy; and (2) Jacoba had been counsel of record for Veneracion in Civil Case No. 2836, supporting Velasco-Jacobas assertion that she had not "actually participate[d]" in the prosecution of the case. Moreover, Jacoba filed a Manifestation in Civil Case No. 2836, praying that Judge Lacurom await the outcome of the petition for certiorari before deciding the contempt charge against him.41 This petition for certiorari anchors some of its arguments on the premise that the motion was, in fact, Jacobas handiwork.42 The marital privilege rule, being a rule of evidence, may be waived by failure of the claimant to object timely to its presentation or by any conduct that may be construed as implied consent.43 This waiver applies to Jacoba who impliedly admitted authorship of the 30 July 2001 motion.

The Code of Professional Responsibility provides: Rule 11.03.A lawyer shall abstain from scandalous, offensive or menacing language or behavior before the Courts. Rule 11.04.A lawyer shall not attribute to a Judge motives not supported by the record or have no materiality to the case. No doubt, the language contained in the 30 July 2001 motion greatly exceeded the vigor required of Jacoba to defend ably his clients cause. We recall his use of the following words and phrases: abhorrent nullity, legal monstrosity, horrendous mistake, horrible error, boner, and an insult to the judiciary and an anachronism in the judicial process . Even Velasco-Jacoba acknowledged that the words created "a cacophonic picture of total and utter disrespect."44 Respondents nonetheless try to exculpate themselves by saying that every remark in the 30 July 2001 motion was warranted. We disagree. Well-recognized is the right of a lawyer, both as an officer of the court and as a citizen, to criticize in properly respectful terms and through legitimate channels the acts of courts and judges. 45 However, even the most hardened judge would be scarred by the scurrilous attack made by the 30 July 2001 motion on Judge Lacuroms Resolution. On its face, the Resolution presented the facts correctly and decid ed the case according to supporting law and jurisprudence. Though a lawyers language may be forceful and emp hatic, it should always be dignified and respectful, befitting the dignity of the legal profession.46 The use of unnecessary language is proscribed if we are to promote high esteem in the courts and trust in judicial administration.47 In maintaining the respect due to the courts, a lawyer is not merely enjoined to use dign ified language but also to pursue the clients cause through fair and honest means, thus: Rule 19.01.A lawyer shall employ only fair and honest means to attain the lawful objectives of his client and shall not present, participate in presenting or threaten to present unfounded criminal charges to obtain an improper advantage in any case or proceeding. Shortly after the filing of the 30 July 2001 motion but before its resolution, Jacoba assisted his client in instituting two administrative cases against Judge Lacurom. As we have earlier noted, Civil Case No. 2836 was then pending before Judge Lacuroms sala. The Courts attention is drawn to the fact that the timing of the filing of these administrative cases could very well raise the suspicion that the cases were intended as leverage against Judge Lacurom. Respondent spouses have both been the subject of administrative cases before this Court. In Administrative Case No. 2594, we suspended Jacoba from the practice of law for a period of six months because of "his failure to file an action for the recovery of possession of property despite the lapse of two and a half years from receipt by him of P550 which his client gave him as filing and sheriffs fees."48 In Administrative Case No. 5505, Jacoba was once again found remiss in his duties when he failed to file the appellants brief, resulting in th e dismissal of his clients appeal. We imposed the penalty of one year suspension.49 As for Velasco-Jacoba, only recently this Court fined her P5,000 for appearing in barangay conciliation proceedings on behalf of a party, knowing fully well the prohibition contained in Section 415 of the Local Government Code. 50

In these cases, the Court sternly warned respondents that a repetition of similar acts would merit a stiffer penalty. Yet, here again we are faced with the question of whether respondents have conducted themselves with the courtesy and candor required of them as members of the bar and officers of the court. We find respondents to have fallen short of the mark. WHEREFORE, we SUSPEND Atty. Ellis F. Jacoba from the practice of law for two (2) years effective upon finality of this Decision. We also SUSPEND Atty. Olivia Velasco-Jacoba from the practice of law for two (2) months effective upon finality of this Decision. We STERNLY WARN respondentsthat a repetition of the same or similar infraction shall merit a more severe sanction. Let copies of this Decision be furnished the Office of the Bar Confidant, to be appended to respondents personal records as attorneys; the Integrated Bar of the Philippines; and all courts in the country for their information and guidance. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila THIRD DIVISION G.R. No. 179127 December 24, 2008

IN-N-OUT BURGER, INC., petitioner, vs. SEHWANI, INCORPORATED AND/OR BENITAS FRITES, INC., respondents. DECISION CHICO-NAZARIO, J.: This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, seeking to reverse the Decision 1 dated 18 July 2006 rendered by the Court of Appeals in CA-G.R. SP No. 92785, which reversed the Decision 2 dated 23 December 2005 of the Director General of the Intellectual Property Office (IPO) in Appeal No. 10-05-01. The Court of Appeals, in its assailed Decision, decreed that the IPO Director of Legal Affairs and the IPO Director General do not have jurisdiction over cases involving unfair competition. Petitioner IN-N-OUT BURGER, INC., a business entity incorporated under the laws of California, United States (US) of America, which is a signatory to the Convention of Paris on Protection of Industrial Property and the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS). Petitioner is engaged mainly in the restaurant business, but it has never engaged in business in the Philippines. 3 Respondents Sehwani, Incorporated and Benita Frites, Inc. are corporations organized in the Philippines. 4 On 2 June 1997, petitioner filed trademark and service mark applications with the Bureau of Trademarks (BOT) of the IPO for "IN-N-OUT" and "IN-N-OUT Burger & Arrow Design." Petitioner later found out, through the Official Action Papers issued by the IPO on 31 May 2000, that respondent Sehwani, Incorporated had already obtained Trademark Registration for the mark "IN N OUT (the inside of the letter "O" formed like a star)."5 By virtue of a licensing agreement, Benita Frites, Inc. was able to use the registered mark of respondent Sehwani, Incorporated. Petitioner eventually filed on 4 June 2001 before the Bureau of Legal Affairs (BLA) of the IPO an administrative complaint against respondents for unfair competition and cancellation of trademark registration. Petitioner averred in its complaint that it is the owner of the trade name INN-OUT and the following trademarks: (1) "IN-N-OUT"; (2) "IN-N-OUT Burger & Arrow Design"; and (3) "IN-N-OUT Burger Logo." These trademarks are registered with the Trademark Office of the US and in various parts of the world, are internationally well-known, and have become distinctive of its business and goods through its long and exclusive commercial use. 6 Petitioner pointed out that its internationally well-known trademarks and the mark of the respondents are all registered for the restaurant business and are clearly identical and confusingly similar. Petitioner claimed that respondents are making it appear that their goods and services are those of the petitioner, thus, misleading ordinary and unsuspecting consumers that they are purchasing petitioners products. 7

Following the filing of its complaint, petitioner sent on 18 October 2000 a demand letter directing respondent Sehwani, Incorporated to cease and desist from claiming ownership of the mark "IN-N-OUT" and to voluntarily cancel its trademark registration. In a letter-reply dated 23 October 2000, respondents refused to accede to petitioner demand, but expressed willingness to surrender the registration of respondent Sehwani, Incorporated of the "IN N OUT" trademark for a fair and reasonable consideration. 8 Petitioner was able to register the mark "Double Double" on 4 July 2002, based on their application filed on 2 June 1997.9 It alleged that respondents also used this mark, as well as the menu color scheme. Petitioners also averred that respondent Benitas receipts bore the phrase, "representing IN-N-OUT Burger."10 It should be noted that that although respondent Sehwahi, Incorporated registered a mark which appeared as "IN N OUT (the inside of the letter "O" formed like a star)," respondents used the mark "IN-N-OUT."11 To counter petitioners complaint, respondents filed before the BLA -IPO an Answer with Counterclaim. Respondents asserted therein that they had been using the mark "IN N OUT" in the Philippines since 15 October 1982. On 15 November 1991, respondent Sehwani, Incorporated filed with the then Bureau of Patents, Trademarks and Technology Transfer (BPTTT) an application for the registration of the mark "IN N OUT (the inside of the letter "O" formed like a star)." Upon approval of its application, a certificate of registration of the said mark was issued in the name of respondent Sehwani, Incorporated on 17 December 1993. On 30 August 2000, respondents Sehwani, Incorporated and Benita Frites, Inc. entered into a Licensing Agreement, wherein the former entitled the latter to use its registered mark, "IN N OUT." Respondents asserted that respondent Sehwani, Incorporated, being the registered owner of the mark "IN N OUT," should be accorded the presumption of a valid registration of its mark with the exclusive right to use the same. Respondents argued that none of the grounds provided under the Intellectual Property Code for the cancellation of a certificate of registration are present in this case. Additionally, respondents maintained that petitioner had no legal capacity to sue as it had never operated in the Philippines. 12 Subsequently, the IPO Director of Legal Affairs, Estrellita Beltran-Abelardo, rendered a Decision dated 22 December 2003, 13 in favor of petitioner. According to said Decision, petitioner had the legal capacity to sue in the Philippines, since its country of origin or domicile was a member of and a signatory to the Convention of Paris on Protection of Industrial Property. And although petitioner had never done business in the Philippines, it was widely known in this country through the use herein of products bearing its corporate and trade name. Petitioners marks are internationally well-known, given the world-wide registration of the mark "IN-N-OUT," and its numerous advertisements in various publications and in the Internet. Moreover, the IPO had already declared in a previous inter partes case that "In-N-Out Burger and Arrow Design" was an internationally well-known mark. Given these circumstances, the IPO Director for Legal Affairs pronounced in her Decision that petitioner had the right to use its tradename and mark "IN-N-OUT" in the Philippines to the exclusion of others, including the respondents. However, respondents used the mark "IN N OUT" in good faith and were not guilty of unfair competition, since respondent Sehwani, Incorporated did not evince any intent to ride upon petitioners goodwill by copying the mark "IN -N-OUT Burger" exactly. The inside of the letter "O" in the mark used by respondents formed a star. In addition, the simple act of respondent Sehwani, Incorporated of inquiring into the existence of a pending application for registration of the "IN-N-OUT" mark was not deemed fraudulent. The dispositive part of the Decision of the IPO Director for Legal Affairs reads: With the foregoing disquisition, Certificate of Registration No. 56666 dated 17 December 1993 for the mark "IN-N-OUT" (the inside of the letter "O" formed like a star) issued in favor of Sehwani, Incorporated is hereby CANCELLED. Consequently, respondents Sehwani, Inc. and Benitas Frites are hereby ordered to permanently cease and desist from using the mark "IN -N-OUT" and "IN-N-OUT BURGER LOGO" on its goods and in its business. With regards the mark "Double-Double," considering that as earlier discussed, the mark has been approved by this Office for publication and that as shown by evidence, Complainant is the owner of the said mark, Respondents are so hereby ordered to permanently cease and desist from using the mark Double-Double. NO COSTS. 14

Both parties filed their respective Motions for Reconsideration of the aforementioned Decision. Respondents Motion for Reconsideration 15 and petitioners Motion for Partial Reconsideration 16 were denied by the IPO Director for Legal Affairs in Resolution No. 2004-1817 dated 28 October 2004 and Resolution No. 2005-05 dated 25 April 2005,18 respectively. Subsequent events would give rise to two cases before this Court, G.R. No. 171053 and G.R. No. 179127, the case at bar. G.R. No. 171053 On 29 October 2004, respondents received a copy of Resolution No. 2004-18 dated 28 October 2004 denying their Motion for Reconsideration. Thus, on 18 November 2004, respondents filed an Appeal Memorandum with IPO Director General Emma Francisco (Director General Francisco). However, in an Order dated 7 December 2004, the appeal was dismissed by the IPO Director General for being filed beyond the 15-day reglementary period to appeal. Respondents appealed to the Court of Appeals via a Petition for Review under Rule 43 of the Rules of Court, filed on 20 December 2004 and docketed as CA-G.R. SP No. 88004, challenging the dismissal of their appeal by the IPO Director General, which effectively affirmed the Decision dated 22 December 2003 of the IPO Director for Legal Affairs ordering the cancellation of the registration of the disputed trademark in the name of respondent Sehwani, Incorporated and enjoining respondents from using the same. In particular, respondents based their Petition on the following grounds: THE IPO DIRECTOR GENERAL COMMITTED GRAVE ERROR IN DISMISSING APPEAL NO. 14-2004-00004 ON A MERE TECHNICALITY THE BUREAU OF LEGAL AFFAIRS (SIC) DECISION AND RESOLUTION (1) CANCELLING RESPONDENTS CERTIFICATE OF REGISTRATION FOR THE MARK "IN-N-OUT," AND (2) ORDERING PETITIONERS TO PERMANENTLY CEASE AND DESIST FROM USING THE SUBJECT MARK ON ITS GOODS AND BUSINESS ARE CONTRARY TO LAW AND/OR IS NOT SUPPORTED BY EVIDENCE. Respondents thus prayed: WHEREFORE, petitioners respectfully pray that this Honorable Court give due course to this petition, and thereafter order the Office of the Director General of the Intellectual Property Office to reinstate and give due course to [respondent]s Appeal No. 14 -2004-00004. Other reliefs, just and equitable under the premises, are likewise prayed for. On 21 October 2005, the Court of Appeals rendered a Decision denying respondents Petition in CA -G.R SP No. 88004 and affirming the Order dated 7 December 2004 of the IPO Director General. The appellate court confirmed that respondents appeal before the IPO Director General was filed out of time and that it was only proper to cancel the registration of the disputed trademark in the name of respondent Sehwani, Incorporated and to permanently enjoin respondents from using the same. Effectively, the 22 December 2003 Decision of IPO Director of Legal Affairs was likewise affirmed. On 10 November 2005, respondents moved for the reconsideration of the said Decision. On 16 January 2006, the Court of Appeals denied their motion for reconsideration. Dismayed with the outcome of their petition before the Court of Appeals, respondents raised the matter to the Supreme Court in a Petition for Review under Rule 45 of the Rules of Court, filed on 30 January 2006, bearing the title Sehwani, Incorporated v. In-N-Out Burger and docketed as G.R. No. 171053.19

This Court promulgated a Decision in G.R. No. 171053 on 15 October 2007,20 finding that herein respondents failed to file their Appeal Memorandum before the IPO Director General within the period prescribed by law and, consequently, they lost their right to appeal. The Court further affirmed the Decision dated 22 December 2003 of the IPO Director of Legal Affairs holding that herein petitioner had the legal capacity to sue for the protection of its trademarks, even though it was not doing business in the Philippines, and ordering the cancellation of the registration obtained by herein respondent Sehwani, Incorporated of the internationally well-known marks of petitioner, and directing respondents to stop using the said marks. Respondents filed a Motion for Reconsideration of the Decision of this Court in G.R. No. 171053, but it was denied with finality in a Resolution dated 21 January 2008. G.R. No. 179127 Upon the denial of its Partial Motion for Reconsideration of the Decision dated 22 December 2003 of the IPO Director for Legal Affairs, petitioner was able to file a timely appeal before the IPO Director General on 27 May 2005. During the pendency of petitioners appeal before the IPO Director Gener al, the Court of Appeals already rendered on 21 October 2005 its Decision dismissing respondents Petition in CA-G.R. SP No. 88004. In a Decision dated 23 December 2005, IPO Director General Adrian Cristobal, Jr. found petitioners appeal meritorious and m odified the Decision dated 22 December 2003 of the IPO Director of Legal Affairs. The IPO Director General declared that respondents were guilty of unfair competition. Despite respondents claims that they had been using the mark since 1982, they only star ted constructing their restaurant sometime in 2000, after petitioner had already demanded that they desist from claiming ownership of the mark "IN-N-OUT." Moreover, the sole distinction of the mark registered in the name of respondent Sehwani, Incorporated, from those of the petitioner was the star inside the letter "O," a minor difference which still deceived purchasers. Respondents were not even actually using the star in their mark because it was allegedly difficult to print. The IPO Director General exp ressed his disbelief over the respondents reasoning for the non -use of the star symbol. The IPO Director General also considered respondents use of petitioners registered mark "Double -Double" as a sign of bad faith and an intent to mislead the public. Thus, the IPO Director General ruled that petitioner was entitled to an award for the actual damages it suffered by reason of respondents acts of unfair competition, exemplary damages, and attorneys fees. 21 The fallo of the Decision reads: WHEREFORE, premises considered, the [herein respondents] are held guilty of unfair competition. Accordingly, Decision No. 2003-02 dated 22 December 2003 is hereby MODIFIED as follows: [Herein Respondents] are hereby ordered to jointly and severally pay [herein petitioner]: 1. Damages in the amount 28/100(P212,574.28); of TWO HUNDRED TWELVE THOUSAND FIVE HUNDRED SEVENTY FOUR AND

2. Exemplary damages in the amount of FIVE HUNDRED THOUSAND PESOS (P500,000.00); 3. Attorneys fees and expenses of litigation in the amount of FIVE HUNDRED THOUSAND PESOS (P500,000.00). All products of [herein respondents] including the labels, signs, prints, packages, wrappers, receptacles and materials used by them in committing unfair competition should be without compensation of any sort be seized and disposed of outside the channels of commerce.

Let a copy of this Decision be furnished the Director of Bureau of Legal Affairs for appropriate action, and the records be returned to her for proper disposition. Further, let a copy of this Decision be furnished the Documentation, Information and Technology Transfer Bureau for their information and records purposes.22 Aggrieved, respondents were thus constrained to file on 11 January 2006 before the Court of Appeals another Petition for Review under Rule 43 of the Rules of Court, docketed as CA-G.R. SP No. 92785. Respondents based their second Petition before the appellate court on the following grounds: THE IPO DIRECTOR GENERAL COMMITTED GRAVE ERROR IN HOLDING PETITIONERS LIABLE FOR UNFAIR COMPETITION AND IN ORDERING THEM TO PAY DAMAGES AND ATTORNEYS FEES TO RESPONDENTS THE IPO DIRECTOR GENERAL COMMITTED GRAVE ERROR IN AFFIRMING THE BUREAU OF LEGAL AFFAIRS DECISION (1) CANCELLING PETITIONERS CERTIFICATE OF REGISTRATION FOR THE MARK "IN -N-OUT," AND (2) ORDERING PETITIONERS TO PERMANENTLY CEASE AND DESIST FROM USING THE SUBJECT MARK ON ITS GOODS AND BUSINESS Respondents assailed before the appellate court the foregoing 23 December 2005 Decision of the IPO Director General, alleging that their use of the disputed mark was not tainted with fraudulent intent; hence, they should not be held liable for damages. They argued that petitioner had never entered into any transaction involving its goods and services in the Philippines and, therefore, could not claim that its goods and services had already been identified in the mind of the public. Respondents added that the disputed mark was not well-known. Finally, they maintained that petitioners complaint was already barred by laches.23 At the end of their Petition in CA-G.R. SP No. 92785, respondents presented the following prayer: WHEREFORE, [respondents herein] respectfully pray that this Honorable Court: (a) upon the filing of this petition, issue a temporary restraining order enjoining the IPO and [petitioner], their agents, successors and assigns, from executing, enforcing and implementing the IPO Director Generals Decision dated 23 December 2005, which modifie d the Decision No. 2003-02 dated 22 December 2003 of the BLA, until further orders from this Honorable Court. (b) after notice and hearing, enjoin the IPO and [petitioner], their agents, successors and assigns, from executing, enforcing and implementing the Decision dated 23 December 2005 of the Director General of the IPO in IPV No. 10-2001-00004 and to maintain the status quo ante pending the resolution of the merits of this petition; and (c) after giving due course to this petition: (i) reverse and set aside the Decision dated 23 December 2005 of the Director General of the IPO in IPV No. 10-2001-00004 finding the [respondents] guilty of unfair competition and awarding damages and attorneys fees to the respondent (ii) in lieu thereof, affirm Decision No. 2003-02 of the BLA dated 22 December 2003 and Resolution No. 2005-05 of the BLA dated 25 April 2005, insofar as it finds [respondents] not guilty of unfair competition and hence not liable to the [petitioner] for damages and attorneys fees;

(iii) reverse Decision No. 2003-02 of the BLA dated 22 December 2003, and Resolution No. 2005-05 of the BLA dated 25 April 2005, insofar as it upheld [petitioner]s legal capacity to sue; that [petitioner]s trademarks are well -known; and that respondent has the exclusive right to use the same; and (iv) make the injunction permanent. [Respondents] also pray for other reliefs, as may deemed just or equitable. 24 On 18 July 2006, the Court of Appeals promulgated a Decision25 in CA-G.R. SP No. 92785 reversing the Decision dated 23 December 2005 of the IPO Director General. The Court of Appeals, in its Decision, initially addressed petitioners assertion that respondents had committed forum shopping by the institution of CA-G.R. SP No. 88004 and CA-G.R. SP No. 92785. It ruled that respondents were not guilty of forum shopping, distinguishing between the respondents two Petitions. The subject of Respondents Petition in CA -G.R SP No. 88004 was the 7 December 2004 Decision of the IPO Director General dismissing respondents appeal of the 22 December 2003 Decision of the IPO Director of Legal Affai rs. Respondents questioned therein the cancellation of the trademark registration of respondent Sehwani, Incorporated and the order permanently enjoining respondents from using the disputed trademark. Respondents Petition in CA -G.R. SP No. 92785 sought the review of the 23 December 2005 Decision of the IPO Director General partially modifying the 22 December 2003 Decision of the IPO Director of Legal Affairs. Respondents raised different issues in their second petition before the appellate court, mainly concerning the finding of the IPO Director General that respondents were guilty of unfair competition and the awarding of actual and exemplary damages, as well as attorneys fees, t o petitioner. The Court of Appeals then proceeded to resolve CA-G.R. SP No. 92785 on jurisdictional grounds not raised by the parties. The appellate court declared that Section 163 of the Intellectual Property Code specifically confers upon the regular courts, and not the BLA-IPO, sole jurisdiction to hear and decide cases involving provisions of the Intellectual Property Code, particularly trademarks. Consequently, the IPO Director General had no jurisdiction to rule in its Decision dated 23 December 2005 on supposed violations of these provisions of the Intellectual Property Code. In the end, the Court of Appeals decreed: WHEREFORE, the Petition is GRANTED. The Decision dated 23 December 2005 rendered by the Director General of the Intellectual Property Office of the Philippines in Appeal No. 10-05-01 is REVERSED and SET ASIDE. Insofar as they pertain to acts governed by Article 168 of R.A. 8293 and other sections enumerated in Section 163 of the same Code, respondents claims in its Complaint docketed as IPV No. 10-2001-00004 are hereby DISMISSED.26 The Court of Appeals, in a Resolution dated 31 July 2007,27 denied petitioners Motion for Reconsideration of its aforementioned Decision. Hence, the present Petition, where petitioner raises the following issues: I

WHETHER OR NOT THE COURT OF APPEALS ERRED IN ISSUING THE QUESTIONED DECISION DATED 18 JULY 2006 AND RESOLUTION DATED 31 JULY 2007 DECLARING THAT THE IPO HAS NO JURISDICTION OVER ADMINISTRATIVE COMPLAINTS FOR INTELLECTUAL PROPERTY RIGHTS VIOLATIONS; II WHETHER OR NOT THE INSTANT PETITION IS FORMALLY DEFECTIVE; AND III WHETHER OR NOT THE COURT OF APPEALS ERRED IN ISSUING THE QUESTIONED DECISION DATED 18 JULY 2006 AND RESOLUTION DATED 31 JULY 2007 DECLARING THAT SEHWANI AND BENITA ARE NOT GUILTY OF: (A) SUBMITTING A PATENTLY FALSE CERTIFICATION OF NON-FORUM SHOPPING; AND (B) FORUM SHOPPING PROPER. 28 As previously narrated herein, on 15 October 2007, during the pendency of the present Petition, this Court already promulgated its Decision29 in G.R. No. 171053 on 15 October 2007, which affirmed the IPO Director Generals dismissal of respondents appeal for being f iled beyond the reglementary period, and left the 22 December 2003 Decision of the IPO Director for Legal Affairs, canceling the trademark registration of respondent Sehwani, Incorporated and enjoining respondents from using the disputed marks. Before discussing the merits of this case, this Court must first rule on the procedural flaws that each party has attributed to the other. Formal Defects of the Petition Respondents contend that the Verification/Certification executed by Atty. Edmund Jason Barranda of Villaraza and Angangco, which petitioner attached to the present Petition, is defective and should result in the dismissal of the said Petition. Respondents point out that the Secretarys Certificate executed by Arnold M. Wensinger on 20 August 2007, stating that petiti oner had authorized the lawyers of Villaraza and Angangco to represent it in the present Petition and to sign the Verification and Certification against Forum Shopping, among other acts, was not properly notarized. The jurat of the aforementioned Secretarys Certificate reads: Subscribed and sworn to me this 20th day of August 2007 in Irving California. Rachel A. Notary Public30 Blake (Sgd.)

Respondents aver that the said Secretarys Certificate cannot properly authorize Atty. Barranda to sign the Verification/Cert ification on behalf of petitioner because the notary public Rachel A. Blake failed to state that: (1) petitioners Corporate Secret ary, Mr. Wensinger, was known to her; (2) he was the same person who acknowledged the instrument; and (3) he acknowledged the same to be his free act and deed, as required under Section 2 of Act No. 2103 and Landingin v. Republic of the Philippines.31

Respondents likewise impugn the validity of the notarial certificate of Atty. Aldrich Fitz B. Uy, on Atty. Barandas Verifica tion/Certification attached to the instant Petition, noting the absence of (1) the serial number of the commission of the notary public; (2) the office address of the notary public; (3) the roll of attorneys number and the IBP membership number; and (4) a statement that the Verification /Certification was notarized within the notary publics territorial jurisdiction, as required under the 2004 Rules on Notarial Practice. 32 Section 2 of Act No. 2103 and Landingin v. Republic of the Philippines are not applicable to the present case. The requirements enumerated therein refer to documents which require an acknowledgement, and not a mere jurat. A jurat is that part of an affidavit in which the notary certifies that before him/her, the document was subscribed and sworn to by the executor. Ordinarily, the language of the jurat should avow that the document was subscribed and sworn to before the notary public. In contrast, an acknowledgment is the act of one who has executed a deed in going before some competent officer or court and declaring it to be his act or deed. It involves an extra step undertaken whereby the signor actually declares to the notary that the executor of a document has attested to the notary that the same is his/her own free act and deed. 33 A Secretarys Certificate, as that executed by petiti oner in favor of the lawyers of the Angangco and Villaraza law office, only requires a jurat.34 Even assuming that the Secretarys Certificate was flawed, Atty. Barranda may still sign the Verification attached to the Petition at bar. A pleading is verified by an affidavit that the affiant has read the pleading and that the allegations therein are true and correct of his personal knowledge or based on authentic records. 35 The party itself need not sign the verification. A partys representative, lawyer or any other person who personally knows the truth of the facts alleged in the pleading may sign the verification.36 Atty. Barranda, as petitioners counsel, was in the position to verify the truth and correctness of the allegations of the present Petition. Hence, the Verification signed by Atty. Barranda substantially complies with the formal requirements for such. Moreover, the Court deems it proper not to focus on the supposed technical infirmities of Atty. Barandas Verifi cation. It must be borne in mind that the purpose of requiring a verification is to secure an assurance that the allegations of the petition has been made in good faith; or are true and correct, not merely speculative. This requirement is simply a condition affecting the form of pleadings, and non-compliance therewith does not necessarily render it fatally defective. Indeed, verification is only a formal, not a jurisdictional requirement. In the interest of substantial justice, strict observance of procedural rules may be dispensed with for compelling reasons.37 The vital issues raised in the instant Petition on the jurisdiction of the IPO Director for Legal Affairs and the IPO Director General over trademark cases justify the liberal application of the rules, so that the Court may give the said Petition due course and resolve the same on the merits. This Court agrees, nevertheless, that the notaries public, Rachel A. Blake and Aldrich Fitz B. Uy, were less than careful with their jurats or notarial certificates. Parties and their counsel should take care not to abuse the Courts zeal to resolve cases on their mer its. Notaries public in the Philippines are reminded to exert utmost care and effort in complying with the 2004 Rules on Notarial Practice. Parties and their counsel are further charged with the responsibility of ensuring that documents notarized abroad be in their proper form before presenting said documents before Philippine courts. Forum Shopping Petitioner next avers that respondents are guilty of forum shopping in filing the Petition in CA-G.R. SP No. 92785, following their earlier filing of the Petition in CA-G.R SP No. 88004. Petitioner also asserts that respondents were guilty of submitting to the Court of Appeals a patently false Certification of Non-forum Shopping in CA-G.R. SP No. 92785, when they failed to mention therein the pendency of CA-G.R SP No. 88004.

Forum shopping is the institution of two or more actions or proceedings grounded on the same cause on the supposition that one or the other court would make a favorable disposition. It is an act of malpractice and is prohibited and condemned as trifling with courts and abusing their processes. In determining whether or not there is forum shopping, what is important is the vexation caused the courts and parties-litigants by a party who asks different courts and/or administrative bodies to rule on the same or related causes and/or grant the same or substantially the same reliefs and in the process creates the possibility of conflicting decisions being rendered by the different bodies upon the same issues.38 Forum shopping is present when, in two or more cases pending, there is identity of (1) parties (2) rights or causes of action and reliefs prayed for, and (3) the identity of the two preceding particulars is such that any judgment rendered in the other action, will, regardless of which party is successful, amount to res judicata in the action under consideration.39 After a cursory look into the two Petitions in CA-G.R. SP No. 88004 and CA-G.R. SP No. 92785, it would at first seem that respondents are guilty of forum shopping. There is no question that both Petitions involved identical parties, and raised at least one similar ground for which they sought the same relief. Among the grounds stated by the respondents for their Petition in CA-G.R SP No. 88004 was that "[T]he Bureau of Legal Affairs (sic) Decision and Resolution (1) canceling [herein respondent Sehwani, Incorporated]s certificate of registration for the mark IN-N-OUT and (2) ordering [herein respondents] to permanently cease and desist from using the subject mark on its goods and business are contrary to law and/or is (sic) not supported by evidence."40 The same ground was again invoked by respondents in their Petition in CA-G.R. SP No. 92785, rephrased as follows: "The IPO Director General committed grave error in affirming the Bureau of Legal Affairs (sic) Decision (1) canceling [herein respondent Sehwani, Incorporated]s certificate of registration for the mark "IN -N-OUT," and (2) ordering [herein respondents] to permanently cease and desist from using the subject mark on its goods and business." 41 Both Petitions, in effect, seek the reversal of the 22 December 2003 Decision of the IPO Director of Legal Affairs. Undoubtedly, a judgment in either one of these Petitions affirming or reversing the said Decision of the IPO Director of Legal Affairs based on the merits thereof would bar the Court of Appeals from making a contrary ruling in the other Petition, under the principle of res judicata. Upon a closer scrutiny of the two Petitions, however, the Court takes notice of one issue which respondents did not raise in CA-G.R. SP No. 88004, but can be found in CA-G.R. SP No. 92785, i.e., whether respondents are liable for unfair competition. Hence, respondents seek additional reliefs in CA-G.R. SP No. 92785, seeking the reversal of the finding of the IPO Director General that they are guilty of unfair competition, and the nullification of the award of damages in favor of petitioner resulting from said finding. Undoubtedly, respondents could not have raised the issue of unfair competition in CA-G.R. SP No. 88004 because at the time they filed their Petition therein on 28 December 2004, the IPO Director General had not yet rendered its Decision dated 23 December 2005 wherein it ruled that respondents were guilty thereof and awarded damages to petitioner. In arguing in their Petition in CA-G.R. SP No. 92785 that they are not liable for unfair competition, it is only predictable, although not necessarily legally tenable, for respondents to reassert their right to register, own, and use the disputed mark. Respondents again raise the issue of who has the better right to the disputed mark, because their defense from the award of damages for unfair competition depends on the resolution of said issue in their favor. While this reasoning may be legally unsound, this Court cannot readily presume bad faith on the part of respondents in filing their Petition in CA-G.R. SP No. 92785; or hold that respondents breached the rule on forum shopping by the mere filing of the second petition before the Court of Appeals. True, respondents should have referred to CA-G.R. SP No. 88004 in the Certification of Non-Forum Shopping, which they attached to their Petition in CA-G.R. SP No. 92785. Nonetheless, the factual background of this case and the importance of resolving the jurisdictional and

substantive issues raised herein, justify the relaxation of another procedural rule. Although the submission of a certificate against forum shopping is deemed obligatory, it is not jurisdictional.42 Hence, in this case in which such a certification was in fact submitted, only it was defective, the Court may still refuse to dismiss and, instead, give due course to the Petition in light of attendant exceptional circumstances. The parties and their counsel, however, are once again warned against taking procedural rules lightly. It will do them well to remember that the Courts have taken a stricter stance against the disregard of procedural rules, especially in connection with the submission of the certificate against forum shopping, and it will not hesitate to dismiss a Petition for non-compliance therewith in the absence of justifiable circumstances. The Jurisdiction of the IPO The Court now proceeds to resolve an important issue which arose from the Court of Appeals Decision dated 18 July 2006 in CA-G.R. SP No. 92785. In the afore-stated Decision, the Court of Appeals adjudged that the IPO Director for Legal Affairs and the IPO Director General had no jurisdiction over the administrative proceedings below to rule on issue of unfair competition, because Section 163 of the Intellectual Property Code confers jurisdiction over particular provisions in the law on trademarks on regular courts exclusively. According to the said provision: Section 163. Jurisdiction of Court.All actions under Sections 150, 155, 164, and 166 to 169 shall be brought before the proper courts with appropriate jurisdiction under existing laws. The provisions referred to in Section 163 are: Section 150 on License Contracts; Section 155 on Remedies on Infringement; Section 164 on Notice of Filing Suit Given to the Director; Section 166 on Goods Bearing Infringing Marks or Trade Names; Section 167 on Collective Marks; Section 168 on Unfair Competition, Rights, Regulation and Remedies; and Section 169 on False Designations of Origin, False Description or Representation. The Court disagrees with the Court of Appeals. Section 10 of the Intellectual Property Code specifically identifies the functions of the Bureau of Legal Affairs, thus: Section 10. The Bureau of Legal Affairs.The Bureau of Legal Affairs shall have the following functions: 10.1 Hear and decide opposition to the application for registration of marks; cancellation of trademarks; subject to the provisions of Section 64, cancellation of patents and utility models, and industrial designs; and petitions for compulsory licensing of patents; 10.2 (a) Exercise original jurisdiction in administrative complaints for violations of laws involving intellectual property rights; Provided, That its jurisdiction is limited to complaints where the total damages claimed are not less than Two hundred thousand pesos (P200,000): Provided, futher, That availment of the provisional remedies may be granted in accordance with the Rules of Court. The Director of Legal Affairs shall have the power to hold and punish for contempt all those who disregard orders or writs issued in the course of the proceedings. (b) After formal investigation, the Director for Legal Affairs may impose one (1) or more of the following administrative penalties:

(i) The issuance of a cease and desist order which shall specify the acts that the respondent shall cease and desist from and shall require him to submit a compliance report within a reasonable time which shall be fixed in the order; (ii) The acceptance of a voluntary assurance of compliance or discontinuance as may be imposed. Such voluntary assurance may include one or more of the following: (1) An assurance to comply with the provisions of the intellectual property law violated; (2) An assurance to refrain from engaging in unlawful and unfair acts and practices subject of the formal investigation (3) An assurance to recall, replace, repair, or refund the money value of defective goods distributed in commerce; and (4) An assurance to reimburse the complainant the expenses and costs incurred in prosecuting the case in the Bureau of Legal Affairs. The Director of Legal Affairs may also require the respondent to submit periodic compliance reports and file a bond to guarantee compliance of his undertaking. (iii) The condemnation or seizure of products which are subject of the offense. The goods seized hereunder shall be disposed of in such manner as may be deemed appropriate by the Director of Legal Affairs, such as by sale, donation to distressed local governments or to charitable or relief institutions, exportation, recycling into other goods, or any combination thereof, under such guidelines as he may provide; (iv) The forfeiture of paraphernalia and all real and personal properties which have been used in the commission of the offense; (v) The imposition of administrative fines in such amount as deemed reasonable by the Director of Legal Affairs, which shall in no case be less than Five thousand pesos (P5,000) nor more than One hundred fifty thousand pesos (P150,000). In addition, an additional fine of not more than One thousand pesos (P1,000) shall be imposed for each day of continuing violation; (vi) The cancellation of any permit, license, authority, or registration which may have been granted by the Office, or the suspension of the validity thereof for such period of time as the Director of Legal Affairs may deem reasonable which shall not exceed one (1) year; (vii) The withholding of any permit, license, authority, or registration which is being secured by the respondent from the Office; (viii) The assessment of damages; (ix) Censure; and (x) Other analogous penalties or sanctions.

10.3 The Director General may by Regulations establish the procedure to govern the implementation of this Section.43 (Emphasis provided.) Unquestionably, petitioners complaint, which seeks the cancellation of the disputed mark in the name of respondent Sehwani, Incorporated, and damages for violation of petitioners intellectual property rights, falls within the jurisdiction of the IPO Director of Legal Affairs. The Intellectual Property Code also expressly recognizes the appellate jurisdiction of the IPO Director General over the decisions of the IPO Director of Legal Affairs, to wit: Section 7. The Director General and Deputies Director General . 7.1 Fuctions.The Director General shall exercise the following powers and functions: xxxx b) Exercise exclusive appellate jurisdiction over all decisions rendered by the Director of Legal Affairs, the Director of Patents, the Director of Trademarks, and the Director of Documentation, Information and Technology Transfer Bureau. The decisions of the Director General in the exercise of his appellate jurisdiction in respect of the decisions of the Director of Patents, and the Director of Trademarks shall be appealable to the Court of Appeals in accordance with the Rules of Court; and those in respect of the decisions of the Director of Documentation, Information and Technology Transfer Bureau shall be appealable to the Secretary of Trade and Industry; The Court of Appeals erroneously reasoned that Section 10(a) of the Intellectual Property Code, conferring upon the BLA-IPO jurisdiction over administrative complaints for violations of intellectual property rights, is a general provision, over which the specific provision of Section 163 of the same Code, found under Part III thereof particularly governing trademarks, service marks, and tradenames, must prevail. Proceeding therefrom, the Court of Appeals incorrectly concluded that all actions involving trademarks, including charges of unfair competition, are under the exclusive jurisdiction of civil courts. Such interpretation is not supported by the provisions of the Intellectual Property Code. While Section 163 thereof vests in civil courts jurisdiction over cases of unfair competition, nothing in the said section states that the regular courts have sole jurisdiction over unfair competition cases, to the exclusion of administrative bodies. On the contrary, Sections 160 and 170, which are also found under Part III of the Intellectual Property Code, recognize the concurrent jurisdiction of civil courts and the IPO over unfair competition cases. These two provisions read: Section 160. Right of Foreign Corporation to Sue in Trademark or Service Mark Enforcement Action .Any foreign national or juridical person who meets the requirements of Section 3 of this Act and does not engage in business in the Philippines may bring a civil or administrative action hereunder for opposition, cancellation, infringement, unfair competition, or false designation of origin and false description, whether or not it is licensed to do business in the Philippines under existing laws. xxxx Section 170. Penalties.Independent of the civil and administrative sanctions imposed by law, a criminal penalty of imprisonment from two (2) years to five (5) years and a fine ranging from Fifty thousand pesos (P50,000) to Two hundred thousand pesos

(P200,000), shall be imposed on any person who is found guilty of committing any of the acts mentioned in Section 155, Section168, and Subsection169.1. Based on the foregoing discussion, the IPO Director of Legal Affairs had jurisdiction to decide the petitioners administrative case against respondents and the IPO Director General had exclusive jurisdiction over the appeal of the judgment of the IPO Director of Legal Affairs. Unfair Competition The Court will no longer touch on the issue of the validity or propriety of the 22 December 2003 Decision of the IPO Director of Legal Affairs which: (1) directed the cancellation of the certificate of registration of respondent Sehwani, Incorporated for the mark "IN-N-OUT" and (2) ordered respondents to permanently cease and desist from using the disputed mark on its goods and business. Such an issue has already been settled by this Court in its final and executory Decision dated 15 October 2007 in G.R. No. 171053, Sehwani, Incorporated v. In-N-Out Burger,44 ultimately affirming the foregoing judgment of the IPO Director of Legal Affairs. That petitioner has the superior right to own and use the "IN-N-OUT" trademarks vis--vis respondents is a finding which this Court may no longer disturb under the doctrine of conclusiveness of judgment. In conclusiveness of judgment, any right, fact, or matter in issue directly adjudicated or necessarily involved in the determination of an action before a competent court in which judgment is rendered on the merits is conclusively settled by the judgment therein and cannot again be litigated between the parties and their privies whether or not the claims, demands, purposes, or subject matters of the two actions are the same.45 Thus, the only remaining issue for this Court to resolve is whether the IPO Director General correctly found respondents guilty of unfair competition for which he awarded damages to petitioner. The essential elements of an action for unfair competition are (1) confusing similarity in the general appearance of the goods and (2) intent to deceive the public and defraud a competitor. The confusing similarity may or may not result from similarity in the marks, but may result from other external factors in the packaging or presentation of the goods. The intent to deceive and defraud may be inferred from the similarity of the appearance of the goods as offered for sale to the public. Actual fraudulent intent need not be shown. 46 In his Decision dated 23 December 2005, the IPO Director General ably explains the basis for his finding of the existence of unfair competition in this case, viz: The evidence on record shows that the [herein respondents] were not using their registered trademark but that of the [petitioner]. [Respondent] SEHWANI, INC. was issued a Certificate of Registration for IN N OUT (with the Inside of the Letter "O" Formed like a Star) for restaurant business in 1993. The restaurant opened only in 2000 but under the name IN-N-OUT BURGER. Apparently, the [respondents] started constructing the restaurant only after the [petitioner] demanded that the latter desist from claiming ownership of the mark IN-N-OUT and voluntarily cancel their trademark registration. Moreover, [respondents] are also using [petitioners] registered mark Double-Double for use on hamburger products. In fact, the burger wrappers and the French fries receptacles the [respondents] are using do not bear the mark registered by the [respondent], but the [petitioners] IN -N-OUT Burgers name and trademark IN-N-OUT with Arrow design. There is no evidence that the [respondents] were authorized by the [petitioner] to use the latters marks in the b usiness. [Respondents] explanation that they are not using their own registered trademark due to the difficulty in printing the "star " does not justify the unauthorized use of the [petitioners] trademark instead.

Further, [respondents] are giving their products the general appearance that would likely influence purchasers to believe that these products are those of the [petitioner]. The intention to deceive may be inferred from the similarity of the goods as packed and offered for sale, and, thus, action will lie to restrain such unfair competition. x x x. xxxx [Respondents] use of IN-N-OUT BURGER in busineses signages reveals fraudulent intent to deceive purchasers. Exhibit "GG," which shows the business establishment of [respondents] illustrates the imitation of [petitioners] corporate name IN-N-OUT and signage INN-OUT BURGER. Even the Director noticed it and held: "We also note that In-N-Out Burger is likewise, [petitioners] corporate name. It has used the "IN -N-OUT" Burger name in its restaurant business in Baldwin Park, California in the United States of America since 1948. Thus it has the exclusive right to use the tradenems "In-N-Out" Burger in the Philippines and the respondents are unlawfully using and appropriating the same." The Office cannot give credence to the [respondents] claim of good faith and that they have openly and continuously used the subject mark since 1982 and is (sic) in the process of expanding its business. They contend that assuming that there is value in the foreign registrations presented as evidence by the [petitioner], the purported exclusive right to the use of the subject mark based on such foreign registrations is not essential to a right of action for unfair competition. [Respondents] also claim that actual or probable deception and confusion on the part of customers by reason of respondents practices must always appear, and in the present c ase, the BLA has found none. This Office finds the arguments untenable. In contrast, the [respondents] have the burden of evidence to prove that they do not have fraudulent intent in using the mark IN-NOUT. To prove their good faith, [respondents] could have easily offered evidence of use of their registered trademark, which they claimed to be using as early as 1982, but did not. [Respondents] also failed to explain why they are using the marks of [petitioner] particularly DOUBLE DOUBLE, and the mark IN-NOUT Burger and Arrow Design. Even in their listing of menus, [respondents] used [Appellants] marks of DOUBLE DOUBLE and IN -NOUT Burger and Arrow Design. In addition, in the wrappers and receptacles being used by the [respondents] which also contained the marks of the [petitioner], there is no notice in such wrappers and receptacles that the hamburger and French fries are products of the [respondents]. Furthermore, the receipts issued by the [respondents] even indicate "representing IN-N-OUT." These acts cannot be considered acts in good faith. 47 Administrative proceedings are governed by the "substantial evidence rule." A finding of guilt in an administrative case would have to be sustained for as long as it is supported by substantial evidence that the respondent has committed acts stated in the complaint or formal charge. As defined, substantial evidence is such relevant evidence as a reasonable mind may accept as adequate to support a conclusion.48 As recounted by the IPO Director General in his decision, there is more than enough substantial evidence to support his finding that respondents are guilty of unfair competition. With such finding, the award of damages in favor of petitioner is but proper. This is in accordance with Section 168.4 of the Intellectual Property Code, which provides that the remedies under Sections 156, 157 and 161 for infringement shall apply mutatis mutandis to unfair competition. The remedies provided under Section 156 include the right to damages, to be computed in the following manner:

Section 156. Actions, and Damages and Injunction for Infringement. 156.1 The owner of a registered mark may recover damages from any person who infringes his rights, and the measure of the damages suffered shall be either the reasonable profit which the complaining party would have made, had the defendant not infringed his rights, or the profit which the defendant actually made out of the infringement, or in the event such measure of damages cannot be readily ascertained with reasonable certainty, then the court may award as damages a reasonable percentage based upon the amount of gross sales of the defendant or the value of the services in connection with which the mark or trade name was used in the infringement of the rights of the complaining party. In the present case, the Court deems it just and fair that the IPO Director General computed the damages due to petitioner by applying the reasonable percentage of 30% to the respond ents gross sales, and then doubling the amount thereof on account of respondents actual intent to mislead the public or defraud the petitioner,49 thus, arriving at the amount of actual damages of P212,574.28. Taking into account the deliberate intent of respondents to engage in unfair competition, it is only proper that petitioner be awarded exemplary damages. Article 2229 of the Civil Code provides that such damages may be imposed by way of example or correction for the public good, such as the enhancement of the protection accorded to intellectual property and the prevention of similar acts of unfair competition. However, exemplary damages are not meant to enrich one party or to impoverish another, but to serve as a deterrent against or as a negative incentive to curb socially deleterious action.50 While there is no hard and fast rule in determining the fair amount of exemplary damages, the award of exemplary damages should be commensurate with the actual loss or injury suffered. 51 Thus, exemplary damages of P500,000.00 should be reduced to P250,000.00 which more closely approximates the actual damages awarded. In accordance with Article 2208(1) of the Civil Code, attorneys fees may likewise be awarded to petitioner since exemplary damages are awarded to it. Petitioner was compelled to protect its rights over the disputed mark. The amount of P500,000.00 is more than reasonable, given the fact that the case has dragged on for more than seven years, despite the respondents f ailure to present countervailing evidence. Considering moreover the reputation of petitioners counsel, the actual attorneys fees paid by petitioner would far exceed t he amount that was awarded to it.52 IN VIEW OF THE FOREGOING, the instant Petition is GRANTED. The assailed Decision of the Court of Appeals in CA-G.R. SP No. 92785, promulgated on 18 July 2006, is REVERSED. The Decision of the IPO Director General, dated 23 December 2005, is hereby REINSTATED IN PART, with the modification that the amount of exemplary damages awarded be reduced to P250,000.00. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. 169604 March 6, 2007

NELSON P. COLLANTES, Petitioner, vs. HON. COURT OF APPEALS, CIVIL SERVICE COMMISSION and DEPARTMENT OF NATIONAL DEFENSE, Respondents. DECISION CHICO-NAZARIO, J.: A decision that has acquired finality becomes immutable and unalterable. A final judgment may no longer be modified in any respect, even if the modification is meant to correct erroneous conclusions of fact and law; and whether it be made by the court that rendered it or by the highest court in the land.1 What would happen, however, if two separate decisions, irreconcilably conflicting with each other, both attained finality? Quite clearly, to hold that both decisions are immutable and unalterable would cause not only confusion and uncertainty, but utter bewilderment upon the persons tasked to execute these judgments. This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, seeking to set aside the Decision2 dated 10 March 2005 and the Resolution3 dated 31 August 2005 of the Court of Appeals in CA-G.R. SP No. 78092. The undisputed facts of this case are summarized by the Court of Appeals: Petitioner Nelson Collantes (hereafter, Collantes) was conferred Career Executive Service Eligibility on 29 February 1996. Then President Fidel V. Ramos accorded him the rank of Career Executive Service Officer (CESO) II on 10 February 1997. More than a year later, he was appointed as Undersecretary for Peace and Order of the Department of Interior and Local Government (DILG). With the change of administration, Collantes allegedly received word from persons close to then President Ejercito Estrada to give up his position so that the President could unreservedly appoint his key officials. As such, Collantes relinquished his post at the DILG. Thereafter, on 1 July 1998, President Estrada appointed Collantes to the controversial post Undersecretary for Civilian Relations of the Department of National Defense (DND). As it happened, his stint in the DND was short lived. Collantes was supposedly ordered by then Secretary Orlando Mercado to renounce his post in favor of another presidential appointee, General Orlando Soriano. In deference to the Presidents prerogative, he resigned from office believing that he will soon be given a new assignment.

Unfortunately, Collantes was not given any other post in the government, as in fact, he received a letter from President Estrada terminating his services effective 8 February 1999. Consequently, on 24 March 1999, Collantes requested the assistance of the Career Executive Service Board relative to the termination of his services as Undersecretary for Civilian Relations of the DND invoking his right to security of tenure as a CESO. The termination of Collantes services, notwit hstanding, President Estrada accorded Collantes the highest rank in the CES ranking structure, CESO Rank I, on 17 July 1999. But then, despite this promotion in rank, Collantes did not receive new appointment, and worse, the President appointed Mr. Edgardo Batenga to the much coveted position of Undersecretary for Civilian Relations of the DND. Taking definite action on the matter, Collantes instituted a Petition for Quo Warranto and Mandamus before Us on 29 January 2001, docketed as C.A. G.R. SP NO. 62874. Collantes maintained that he was constructively dismissed from work, without any cause and due process of law, and thus, his position in the DND was never vacated at all. Accordingly, he prayed that the appointment of Mr. Edgardo Batenga be nullified, and that he be reinstated to his former position with full back salaries. Notably, Collantes also sought for appointment to a position of equivalent rank commensurate to his CESO Rank I if reinstatement to his former position is no longer legally feasible. Meanwhile, on 13 August 2001, the CSC favorably acted on Collantes letter -request issuing Resolution No. 011364, and thereby holding that Collantes relief as Undersecretary of DND amounted to illegal dismissal as he was not given another post concomitant t o his eligibility. Then, on 30 August 2001, We rendered Our Decision in C.A. G.R. SP No. 62874 dismissing the Petition for Quo Warranto and Mandamus filed by Collantes. Significantly, We pronounced: "By such actuations of the petitioner, the Court finds that he has (sic) effectively resigned from his position as Undersecretary of the DND, and the public respondents are under no compulsion to reinstate him to his old position. xxxx "In this case, petitioner has undoubtedly shown his intention to relinquish his public office, and has in fact surrendered such post to the Chief Executive, who, on the other hand, has shown his acceptance of the same by appointing a new person to the position relinquished by the petitioner. xxxx Quo warranto, it must be pointed out, is unavailing in the instatnt case, as the public office in question has not been usurped, intruded into or unlawfully held by the present occupant. Nor does the incumbent undersecretary appear to have done or suffered an act which forfeits his assumption. (Section 1, Rule 66, 1997 Rules of Civil Procedure). Furthermore, it appears that the action for quo warranto, assuming it is available, has already lapsed by prescription, pursuant to Section 11 of the pertinent Rule ... xxxx WHEREFORE, premises considered, the instant petition for Quo Warranto and Mandamus is hereby DISMISSED."

The controversy reached the Supreme Court as G.R. No. 149883. Nevertheless, the case was considered closed and terminated when Collantes manifested his desire not to pursue his appeal and withdraw his Petition for Review on Certiorari. Thereafter, Collantes moved for the execution of CSC Resolution No. 011364, which was accordingly granted through CSC Resolution No. 020084 dated 15 January 2002 "directing the DND to give Collantes a position where his eligibility is appropriate and to pay his backwages and other benefits from the time of his termination up to his actual reinstatement." In a Letter dated 7 February 2002, the Legal Affairs Division of the DND, through Atty. Leticia A. Gloria, urged the CSC to revisit its Resolutions which were entirely in conflict with Our 30 August 2001 Decision in C.A. G.R. SP NO. 62874, which has attained finality pursuant to the Supreme Courts Resolution in G.R. No. 149883. Consequently, in complete turnabout from its previous stance, the CSC issued Resolution No. 021482 dated 12 November 2002 declaring that had it been properly informed that a Petition for Quo Warranto and Mandamus was then pending before Us, it would have refrained from ruling on Collantes quandary, thus: "WHEREFORE, the Motion for Reconsideration of Assistant Secretary for Legal Affairs Leticia A. Gloria of the department of National Defense (DND) is hereby GRANTED and CSC Resolutions Nos. 01-1364 dated August 13, 2001 and 02-0084 dated January 15, 2002 are reversed. Accordingly, pursuant to the decision of the Court of Appeals, Nelson P. Collantes is deemed effectively resigned from his position as Undersecretary of the DND." Forthwith, Collantes moved for a reconsideration of this Resolution, but was denied by the CSC in the second assailed Resolution No. 030542 dated 5 May 2003.4 On 18 July 2003, herein petitioner Collantes then filed a Petition for Certiorari with the Court of Appeals praying for the reversal of the Civil Service Commission (CSC) Resolutions No. 021482 and No. 030542. Before the Court of Appeals can decide this case, however, petitioner was appointed as General Manager of the Philippine Retirement Authority on 5 August 2004. The Court of Appeals dismissed the Petition for Certiorari in the assailed 10 March 2005 Decision: WHEREFORE, the Petition for Certiorari is hereby DISMISSED. No grave abuse of discretion may be imputed against the Civil Service Commission for rendering Resolution Nos. 021482 and 030542, dated 12 November 2002 and 5 May 2003, respectively. No pronouncement as to costs.5 The Motion for Reconsideration filed by petitioner was denied in the assailed 31 August 2005 Resolution. 6 Petitioner filed the present Petition for Review, seeking the reversal of the foregoing Decision and Resolution of the Court of Appeals. In view of his 5 August 2004 appointment, however, petitioners prayer is now limited to seeking the payment of backwages and other b enefits that may have been due him from the time of his alleged dismissal on 8 February 1999 to his appointment on 5 August 2004. Petitioner submits the following issues for our consideration: A.

WHETHER THE COURT OF APPEALS COMMITTED A GRAVE AND REVERSIBLE ERROR WHEN IT HELD THAT THE DECISION IN CA-G.R. NO. 62874 IN THE COURT OF APPEALS IS A BAR TO IMPLEMENT THE FINAL AND EXECUTORY JUDGMENT OF THE CIVIL SERVICE COMMISSION DATED AUGUST 14, 2001. B. WHETHER THE COURT OF APPEALS COMMITTED A GRAVE AND REVERSIBLE ERROR WHEN IT DID NOT FIND THAT THE CIVIL SERVICE COMMISSION COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION WHEN IT REVERSED ITS VERY OWN DECISION WHICH HAS LONG BECOME FINAL AND EXECUTORY AND IN FLAGRANT VIOLATION OF PETITIONERS RI GHT TO DUE PROCESS. C. WHETHER THE COURT OF APPEALS COMMITTED A GRAVE AND REVERSIBLE ERROR WHEN IT UPHELD THE RESOLUTION OF THE CIVIL SERVICE COMMISSION WHICH HELD THAT PETITIONER MAY BE REMOVED FROM HIS POSITION AS UNDERSECRETARY OF THE DEPARTMENT OF NATIONAL DEFENSE WITHOUT THE CONCOMITANT TRANSFER TO A POSITION EQUIVALENT IN RANK OR BE REMOVED THEN, BE FLOATED PERPETUALLY, WHICH IS TANTAMOUNT TO A CONSTRUCTIVE DISMISSAL, IN VIOLATION OF HIS RIGHT TO SECURITY OF TENURE AS A CAREER EXECUTIVE SERVICE ELIGIBLE.7 Both petitioner and herein respondents CSC and Department of National Defense (DND) invoke the doctrine of immutability of final judgments. Petitioner claims that the 13 August 2001 Resolution of the CSC, which held that petitioner "was illegally removed as Undersecretary of the Department of National Defense and therefore x x x should be given a position where his eligibility is appropriate or sufficient," has attained finality. Petitioner adds that, not only has there been no appeal or motion for reconsideration filed within the allowable periods, the CSC even granted the Motion for Execution filed by petitioner in its Order dated 15 January 2002. Petitioner thereby invokes our ruling that, before a writ of execution may issue, there must necessarily be a final judgment or order that disposes of the action or proceeding. 8 Petitioner also faults the CSC for ruling on a mere letter filed by Atty. Leticia Gloria of the DND, which petitioner claims is fatally defective for failure to comply with the procedural due process clause of the Constitution, the Rules of Court, and the Uniform Rules in Administrative Cases in the Civil Service which require notice to adverse parties.9 Respondents, on the other hand, invoke the same doctrine of immutability of final judgments, this time with respect to the 30 August 2001 Decision of the Court of Appeals dismissing the Petition for Quo Warranto and Mandamus filed by petitioner. This Court of Appeals Decision became final and executory when petitioner withdrew the Motion for Extension to File a Petition for Review on Certiorari he filed with this Court.10 Forum Shopping, Res Judicata, and Litis Pendentia Our rules on forum shopping are meant to prevent such eventualities as conflicting final decisions as in the case at bar. We have ruled that what is important in determining whether forum shopping exists or not is the vexation caused the courts and parties-litigants by a party who asks different courts and/or administrative agencies to rule on the same or related causes and/or grant the same or substantially the same reliefs, in the process creating the possibility of conflicting decisions being rendered by the different fora upon the same issues. 11

More particularly, the elements of forum shopping are: (a) identity of parties or at least such parties as represent the same interests in both actions; (b) identity of the rights asserted and the reliefs prayed for, the relief being founded on the same facts; and (c) the identity of the two preceding particulars, such that any judgment rendered in the other action will, regardless of which party is successful, amount to res judicata in the action under consideration.12 Forum shopping can be committed in three ways: (1) filing multiple cases based on the same cause of action and with the same prayer, the previous case not having been resolved yet (where the ground for dismissal is litis pendentia); (2) filing multiple cases based on the same cause of action and the same prayer, the previous case having been finally resolved (where the ground for dismissal is res judicata); and (3) filing multiple cases based on the same cause of action but with different prayers (splitting of causes of action, where the ground for dismissal is also either litis pendentia or res judicata).13 If the forum shopping is not considered willful and deliberate, the subsequent cases shall be dismissed without prejudice on one of the two grounds mentioned above. However, if the forum shopping is willful and deliberate, both (or all, if there are more than two) actions shall be dismissed with prejudice.14 Petitioner disputes respondents claim, and the CSCs ruling, 15 that he had lodged two separate actions. Petitioner explains that he never filed a case before the CSC. He merely sought the assistance of the Career Executive Service Board (CESB) in a letter-request dated 24 March 1999. Said letter-request, petitioner claims, did not ask for any ruling. Petitioner claims that, considering that two years had already lapsed without any response from the CESB, he filed on 23 January 2001 his Petition for Quo Warranto and Mandamus with the Court of Appeals. Petitioner was surprised when he learned through the 8 February 2001 letter of the CESB that, on 29 November 2000, it referred petitioners request to the CSC for appropriate action. 16 Petitioner was not required to submit any pleading in support of his request. Apparently, the CSC treated the letter-request as a complaint or petition over which it could exercise its adjudicative powers, as it issued its 13 August 2001 Resolution declaring petitioner to have been illegally removed as Undersecretary of the DND, and should therefore be given a position appropriate or sufficient for his eligibility. 17 As stated above, the Court of Appeals Decision dismissing the Petition for Quo Warranto and Mandamus was rendered 17 days later, on 30 August 2001. Petitioner filed with this Court a motion for an extension of time within which to file a Petition for Review on Certiorari, but he later submitted a Manifestation for the withdrawal of this motion as he decided not to pursue his appeal. 18 Instead, petitioner filed with the CSC on 25 October 2001 a Motion for the Issuance of a Writ of Execution,19 which the CSC granted on 15 January 2002.20 In repeatedly asserting that he did not file two separate actions, petitioner is arguing, without stating it categorically, that he cannot be held liable for forum shopping. However, what one cannot do directly cannot be done indirectly. Petitioner had been aware, through the 8 February 2001 letter of the CESB, that his request for assistance was referred to the CSC on 29 November 2000 for appropriate action. From that point on, he knew that two government agencies the CSC and the Court of Appeals were simultaneously in the process of reaching their respective decisions on whether petitioner was entitled to reinstatement or to a position appropriate to his eligibility. Therefore, it cannot be denied that petitioner knew, from the moment of receipt of the 8 February 2001 letter of the CESB, that he had effectively instituted two separate cases, and whatever original intention he had for his letter-request is, by then, forgotten. Petitioner subsequently proceeded to act like a true forum shopper he abandoned the forum where he could not get a favorable judgment, and moved to execute the Resolution of the forum where he succeeded. Petitioners above actuation is, in fact, a violation of his certification against forum shopping with the Court of Appeals, a ground for dismissal of actions distinct from forum shopping itself. As petitioner knew from the receipt of the CESB letter that another claim was pending in a quasi-judicial agency concerning these issues, he was bound by his certification with the Court of Appeals to report such fact within five days from his knowledge thereof. This circumstance of being surprised by the discovery of another pending claim with another court or quasijudicial agency is the very situation contemplated by letter (c) in the first paragraph of Section 5, Rule 7 of the Rules of Court:

Section 5. Certification against forum shopping. The plaintiff or principal party shall certify under oath in the complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and simultaneously filed therewith: (a) that he has not theretofore commenced any action or filed any claim involving the same issues in any court, tribunal or quasi-judicial agency and, to the best of his knowledge, no such other action or claim is pending therein; (b) if there is such other pending action or claim, a complete statement of the present status thereof; and (c) if he should thereafter learn that the same or similar action or claim has been filed or is pending, he shall report that fact within five (5) days therefrom to the court wherein his aforesaid complaint or initiatory pleading has been filed. (Emphases supplied.) Petitioner, however, further asserts that the issues brought in the Petition for Certiorari filed with the Court of Appeals on 18 July 2003 and the Petition for Quo Warranto and Mandamus filed on 29 January 2001 are distinct, and that the Decision of the Court of Appeals in the latter cannot constitute res judicata with respect to the former. 21 Petitioner claims that the issues, remedies and reliefs in the two cases are different, citing as basis the textbook definitions of quo warranto, certiorari and mandamus. Petitioner further claims that: There is a clear distinction between the right of petitioner to the position of Undersecretary for Civilian Relations and his right to be reappointed to another position of equivalent rank, in view of his CESO I status. The former issue may have been resolved by the Court of Appeals when it ruled that petitioner Collantes had "effectively resigned from his position as Undersecretary of the DND, and the public respondents are under no compulsion to reinstate him to his old position." The latter issue, or the right of petitioner Collantes to be given a new assignment fitting to his CESO I rank, arises from his right to security of tenure as a Career Executive Service Eligible, and not from his appointment to the DND.22 This allegedly clear distinction springs from petitioners claim that he resigned from his position, but not from his rank as a Career Executive Service Officer (CESO). Petitioner claims that, as a CESO, there is a "great difference between (1) resigning from ones posi tion and (2) resigning or relinquishing ones rank, as position is different from ones rank. POSITION refers to the particular or specific office from which one may be appointed. RANK, on the other hand, refers not to a particular position but to the class to which one belongs in the hierarchy of authority in an organization or bureaucracy."23 Petitioner cites Cuevas v. Bacal24: [S]ecurity of tenure to members of the CES does not extend to the particular positions to which they may be appointed --- a concept which is applicable only to the first and second-level employees in the civil service --- but to the rank to which they are appointed by the President. xxxx Mobility and flexibility in the assignment of personnel, the better to cope with the exigencies of public service, is thus the distinguishing feature of the Career Executive Service. x x x. and General v. Roco25: In addition, it must be stressed that the security of tenure of employees in the career executive service (except first and second-level employees in the civil service), pertains only to rank and not to the office or to the position to which they may be appointed. Thus, a career executive service officer may be transferred or reassigned from one position to another without losing his rank which follows him wherever he is transferred or reassigned. In fact, a CESO suffers no diminution of salary even if assigned to a CES position with lower salary grade, as he is compensated according to his CES rank and not on the basis of the position or office he occupies.

While there is indeed a distinction between position and rank, such that a CESO may be transferred or reassigned from one position to another without losing his rank, there can be no distinction between resigning from a position and resigning from a rank. The rank of a CESO is deactivated upon separation from the government service, which includes the resignation of a CESO from his position. The CESB has clarified this concept of being in the inactive status in its Resolution No. 554, series of 2002: Rule II xxxx 7. CESO in Inactive Status - is a CESO who no longer occupies a position in the CES as a result of any of the modes of separation from the government service, provided that such separation is not due to dismissal from the service for cause. xxxx Rule IV Section 1. Modes of Deactivating a CES Rank. There are three (3) modes by which the CES Rank of a CESO may be deactivated from the CES: 1. Acceptance of a position by virtue of an appointment outside the coverage of the CES; 2. Dropping from the rolls of government officials and employees; and 3. Other modes of separation from the CES, provided that separation from the CES resulting from dismissal from the service for cause and after due process shall result in the loss of CES rank and shall not be considered as a mode of deactivation. xxxx Sec. 2. Effect of Deactivation of CES Rank. A CESO whose CES rank has been deactivated by the Board loses all the rights and privileges accorded to him/her by law on account of his/her CES rank. Likewise, it would be absurd for us to rule that a civil servant who resigns from his position can compel the President to appoint him to another position. Such a ruling would effectively derogate the discretion of the appointing authority, 26 as it will give the CESO the option to choose which position he or she wants, by the simple expediency of resigning from the position he or she does not want. In sum, there is an identity of issues in the two cases which resulted in the two conflicting final and executory decisions. But while, as stated above, the second petition can be dismissed on the ground of either res judicata or non-compliance with the undertakings in petitioners certification against forum shopping, these grounds can only be invoked when the case is still pending. As petitioner points out, the Resolution of the CSC had already become final and executory. The 30 August 2001 Decision of the Court of Appeals, however, has also attained finality. Hence, we go back to the main issue in this petition: which of the two final and executory decisions should be given effect, the 30 August 2001 Court of Appeals Decision dismissing the

petitioners Petition for Quo Warranto, or the 13 August 2001 CSC Resolution declaring petitioner Collantes to be illegally removed as Undersecretary of the DND? Two Conflicting Final and Executory Decisions Jurisprudence in the United States offers different solutions to this problem: Where there have been two former actions in which the claim or demand, fact or matter sought to be religated has been decided contrarily, the rule that, where there is an estoppel against an estoppel, it "setteth the matter at large" has been applied by some authorities, and in such case both parties may assert their claims anew. Other authorities have held that, of two conflicting judgments on the same rights of the same parties, the one which is later in time will prevail, although it has also been held that the judgment prior in time will prevail. It has been held that a decision of a court of last resort is binding on the parties, although afterward, in another cause, a different principle was declared.27 There are thus three solutions which we can adopt in resolving the case at bar: the first is for the parties to assert their claims anew, the second is to determine which judgment came first, and the third is to determine which of the judgments had been rendered by a court of last resort. As there are conflicting jurisprudence on the second solution, it is appropriate for this Court to adopt either the first or the third solution. The first solution involves disregarding the finality of the two previous judgments and allowing the parties to argue on the basis of the merits of the case anew. The third solution merely involves the determination of which judgment has been rendered by this Court, the court of last resort in this jurisdiction. Adopting the third solution will result in the denial of this Petition for Certiorari. Whereas the finality of the 13 August 2001 CSC Resolution came about by the failure to file a motion for reconsideration or an appeal within the proper reglementary periods, the finality of the 30 August 2001 Court of Appeals Decision was by virtue of the 12 November 2001 Resolution 28 of this Court which declared the case closed and terminated upon the manifestation of petitioner that he decided not to pursue his appeal and was thus withdrawing the motion for extension of time to file a petition for review on certiorari. The better solution, however, is to let the parties argue the merits of the case anew, and decide the case on the basis thereof. We can do this either by remanding the case to a lower court, or by resolving the issues in this disposition. The latter recourse is more appropriate, for three reasons: (1) all the facts, arguments, and pleadings in support of the parties contentions are now before us, with the parti es advancing the very same contentions as those in this Petition; (2) a remand to the Court of Appeals would entail asking the latter to resolve the very same issues it had passed upon twice; and (3) a remand to the Court of Appeals would only entail another unnecessary delay in the termination of the case when the case is now ripe for adjudication before us. The merits of the case are the focus of petitioners third assignment of error in the present petition. Petitioner claims that the Court of Appeals committed a grave and reversible error when it upheld the resolution of the CSC which allegedly effectively held "that petitioner may be removed from his position as Undersecretary of the Department of National Defense without the concomitant transfer to a position equivalent in rank or be removed then, be floated perpetually, which is tantamount to a constructive dismissal, in violation of his right to security of tenure as a career executive service eligible."29

Petitioners arguments presuppose that he had been removed from his position as Undersecretary of the DND. He, however, did not present any evidence to that effect, whether in this Petition or in his earlier Petition for Quo Warranto and Mandamus with the Court of Appeals. If he is implying that he was removed from office by virtue of his account that he was approached by persons close to President Joseph Estrada who asked him to relinquish his post, which he did, then this Petition must fail, for, by his own deliberate deed, he resigned from his position. There are no special legal effects when a resignation is one of a courtesy resignation. The mere fact that the President, by himself or through another, requested for someones resignation does not give the President the obligation to appoint such person to another pos ition. A courtesy resignation is just as effectual as any other resignation. There can be no implied promises of another position just because the resignation was made out of courtesy. Any express promise of another position, on the other hand, would be void, because there can be no derogation of the discretion of the appointing power, 30 and because its object is outside the commerce of man. 31 As held by the Court of Appeals in its 30 August 2001 Decision: In the first place, petitioner has not established by any quantum of certainty the veracity of his claim that he was promised an equivalent position in the government. Assuming, however, that such promise was true, petitioner, as a ranking member of the bureaucracy, ought to have known that such promise offers no assurance in law that the same would be complied with. The time-honored rule is that public office is a public trust, and as such, the same is governed by law, and cannot be made the subject of personal promises or negotiations by private persons.32 WHEREFORE, the present Petition for Review on Certiorari is DENIED. No costs. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila THIRD DIVISION G.R. No. 126005 January 21, 1999 PEOPLE OF THE PHILIPPINES and ALYNN PLEZETTE DY, petitioners, vs. COURT OF APPEALS, BILLY CERBO and JONATHAN CERBO, respondents. PANGANIBAN, J.: In our criminal justice system, the public prosecutor has the quasi-judicial discretion to determine whether or not case should be filed in court. Courts must. respect the exercise of such discretion when the information filed against the accused valid on its face, and no manifest error, grave abuse of discretion or prejudice can be imputed to the public prosecutor. The Case Before us is a Petition for Review under Rule 45, seeking to reverse the June 28, 1996 Decision and the August 27, 1996 Resolution of the Court of Appeals 1 in CA-GR SP No. 36018. 2 The assailed Decision dismissed the Petition for Certiorari filed by the petitioners, which sought to annul and set aside two Orders of the Regional Trial Court of Nabunturan, Davao: the June 28, 1994 Order dismissing the Information for murder filed against Private Respondent Billy Cerbo and the August 18, 1994 Order denying petitioners' motion for reconsideration. The assailed August 27, 1996 Court of Appeals (CA) Resolution likewise denied petitioners' motion for reconsideration. The Facts The case below arose from the fatal shooting of Petitioner Dy's mother, Rosalinda Dy, in which the primary suspect was Private Respondent Jonathan Cerbo, son of Private Respondent Billy Cerbo. The procedural and factual antecedents of the case were summarized in the challenged Decision of the Court of Appeals as follows: On August 30, 1993, Rosalinda Dy, according to the petition, was shot at pointblank range by private respondent Jonathan Cerbo in the presence and at the office of his father, private respondent Billy Cerbo at Purok 9, Poblacion, Nabunturan, Davao. On September 2, 1993, eyewitness Elsa B. Gumban executed an affidavit positively identifying private respondent Jonathan Cerbo as the assailant. (Annex C, Rollo, p. 34). On September 20, 1993, private respondent Jonathan Cerbo executed a counter-affidavit interposing the defense that the shooting was accidental (Annex D: Rollo, pp. 35-36).

On October 6, 1993, the 3rd Municipal Circuit Trial Court of Nabunturan-Mawab, Davao, after a preliminary investigation, found "sufficient ground to engender a well-founded belief" that the crime of murder has been committed by private respondent Jonathan Cerbo and resolved to forward the entire records of the case to the provincial prosecutor at Tagum, Davao (Annex E, Rollo, pp. 37-38). After [an] information for murder was filed against Jonathan Cerbo, petitioner Alynn Plezette Dy, daughter of the victim Rosalinda Dy, executed an affidavit-complaint charging private respondent Billy Cerbo of conspiracy in the killing (Annex F, Rollo, p. 39), supported by a supplemental affidavit of Elsa B. Gumban, alleging "in addition" to her previous statement that: 3. In addition to my said sworn statement, I voluntarily and freely aver as follows: a) I vividly recall that while my mistress Rosalinda Go and I were in the office of Billy Cerbo at about 11:45 a.m. on August 30, 1993, Mr. Cerbo personally instructed me to fetch the food from the kitchen [and to bring it] to the office instead of the dining room. b) While bringing the food, Mr. Cerbo again instructed me to place the food [o]n a corner table and commanded me to sit behind the entrance door and at the same time Mr. Cerbo positioned Rosalinda [on] a chair facing the entrance door for an easy target. c) Immediately after Rosalinda was shot, Mr. Billy Cerbo called his son Jonathan who was running, but did not and ha[s] never bothered to bring Rosalinda to a hospital or even apply first aid. d) To my surprise, Mr. Billy Cerbo, instead of bringing Rosalinda to the hospital, brought her to the funeral parlor and immediately ordered her to be embalmed without even informing her children or any of her immediate relatives xxx.' Annex G. Rollo, p. 40.) Private respondent Billy Cerbo submitted a counter-affidavit denying the allegations of both petitioner Alynn Plezette Dy and Elsa B. Gumban (Annex H, Rollo, pp. 41-42). On or about April 8, 1994, Prosecutor Protacio Lumangtad filed a "Motion for leave of court to reinvestigate the case" (Annex I, Rollo, pp. 43-44) which was granted by the respondent judge in an order dated April 28, 1994 (Annex J, Rollo, p. 45). In his resolution dated May 5, 1994, Prosecutor Lumangtad recommended the filing of an amended information including Billy Cerbo ". . . as one of the accused in the murder case . . ." (Annex K: Rollo, pp. 46-49). Accordingly, the prosecution filed an amended information including Billy Cerbo in the murder case. A warrant for his arrest was later issued on May 27, 1994 (Rollo, p. 27). Private respondent Billy Cerbo then filed a motion to quash warrant of arrest arguing that the same was issued without probable cause (Rollo, p. 27).

On June 28, 1994, respondent Judge issued the first assailed order dismissing the case against Billy Cerbo and recalling the warrant for his arrest[;] the dispositive portion of [the order] reads: IN THE LIGHT OF ALL THE FOREGOING, [an] order is hereby issued DISMISSING the case as against Billy Cerbo only. Let, therefore, the warrant of arrest, dated May 27, 1994, be RECALLED. The prosecution is hereby ordered to withdraw its Amended Information and file a new one charging Jonathan Cerbo only. SO ORDERED. (Rollo, pp. 29-30). Private Prosecutor Romeo Tagra filed a motion for reconsideration which was denied by the respondent judge in his second assailed order dated August 18, 1994 (Annex B, Rollo, pp. 31-33). 3 The Ruling of the Court of Appeals In its 10-page Decision, the Court of Appeals debunked petitioners' assertion that the trial judge committed a grave abuse of discretion in recalling the warrant of arrest and subsequently dismissing the case against Billy Cerbo. Citing jurisprudence, 4 the appellate court held as follows: The ruling is explicit. If upon the filing of the information in court, the trial judge, after reviewing the information and the documents attached thereto, finds that no probable cause exists, must either call for the complainant and the witnesses or simply dismiss the case. Petitioners question the applicability of the doctrine laid down in the above[-]mentioned case, alleging that the facts therein are different from the instant case. We rule that the disparity of facts does not prevent the application of the principle. We have gone over the supplemental affidavit of Elsa B. Gumban and taking into account the additional facts and circumstances alleged therein, we cannot say that respondent judge gravely abused his discretion in dismissing the case as against private respondent Billy Cerbo for lack of probable cause. xxx xxx xxx The prosecution, if it really believed that Billy Cerbo is probably guilty by conspiracy, should have presented additional evidence sufficiently and credibly demonstrating the existence of probable cause. xxx xxx xxx
5

In sum, the Court of Appeals held that Judge Eugenio Valles did not commit grave abuse of discretion in recalling the warrant of arrest issued against Private Respondent Billy Cerbo and subsequently dismissing the Information for murder filed against the private respondent, because the evidence presented thus far did not substantiate such charge. Hence, this petition. 6 The Assigned Errors Petitioner Dy avers: 1) The Court of Appeals gravely erred in holding that the Regional Trial Court Judge had the authority to reverse [the public prosecutor's] finding of probable cause to prosecute accused . . . and thus dismiss the case filed by the latter on the basis of a motion to quash warrant of arrest. 2) The Court of Appeals gravely erred in fully and unqualifiedly applying the case of Allado, et. al. vs. PACC, et. al. G.R. No. 113630, [to] the case at bench despite [the] clear difference in their respective factual backdrop[s] and the contrary earlier jurisprudence on the matter. 7 On the other hand, the solicitor general posits this sole issue: Whether the Court of Appeals erred in finding that no probable cause exists to merit the filing of charges against private respondent Billy Cerbo. 8 Essentially, the petitioners are questioning the propriety of the trial court's dismissal, for want of evidence, of the Information for murder against Private Respondent Billy Cerbo. In resolving this petition, the discussion of the Court will revolve around the points: first, the determination of probable cause as an executive and judicial function and, second, the applicability of Allado and Salonga to the case at bar. The Court's Ruling The petition is meritorious. The trial court erred in dismissing the information filed against the private respondent. Consequently the Court of Appeals was likewise in error when it upheld such ruling. Executive Determination of Probable Cause The determination of probable cause during a preliminary investigation is a function that belongs to the public prosecutor. It is an executive function, 9 the correctness of the exercise of which is matter that the trial court itself does not and may not be compelled to pass upon. The Separate (Concurring) Opinion of former Chief Justice Andres R. Narvasa in Roberts v. Court of Appeals 10 succinctly elucidates such point in this wise:

xxx xxx xxx In this special civil action, this Court is being asked to assume the function of a public prosecutor. It is being asked to determine whether probable cause exists as regards petitioners. More concretely, the Court is being asked to examine and assess such evidence as has thus far been submitted by the parties and, on the basis thereof, make a conclusion as to whether or not it suffices "to engender a well founded belief that a crime has been committed and that the respondent is probably guilty thereof and should be held for trial." It is a function that this Court should not be called upon to perform. It is a function that properly pertains to the public prosecutor, one that, as far as crimes cognizable by a Regional Trial Court are concerned, and notwithstanding that it involves an adjudicative process of a sort, exclusively pertains, by law, to said executive officer, the public prosecutor. It is moreover a function that in the established scheme of things, is supposed to be performed at the very genesis of, indeed, prefatorily to, the formal commencement of a criminal action. The proceedings before a public prosecutor, it may well be stressed, are essentially preliminary, prefatory and cannot lead to a final, definite and authoritative adjudgment of the guilt or innocence of the persons charged with a felony or crime. Whether or not that function has been correctly discharged by the public prosecutor i.e., whether or not he has made a correct ascertainment of the existence of probable cause in a case, is a matter that the trial court itself does not and may not be compelled to pass upon. It is not for instance permitted for an accused, upon the filing of the information against him by the public prosecutor, to preempt trial by filing a motion with the Trial Court praying for the quash or dismissal of the indictment on the ground that the evidence upon which the same is based is inadequate. Nor is it permitted, on the antipodal theory that the evidence is in truth inadequate, for the complaining party to present a petition before the Court praying that the public prosecutor be compelled to file the corresponding information against the accused. xxx xxx xxx Indeed, the public prosecutor has broad discretion to determine whether probable cause exists and to charge those whom be or she believes to have committed the crime as defined by law. Otherwise stated, such official has the quasi-judicial authority to determine whether or not a criminal case list be filed in court. 11 Thus, in Crespo v. Mogul, 12 we ruled: It is a cardinal principle that all criminal actions either commenced by complaint or by information shall be prosecuted under the direction and control of the fiscal. The institution of a criminal action depends upon the sound discretion of the fiscal. He may or may not file the complaint or information, follow or not follow that presented by the offended party, according to whether the evidence, in his opinion, is sufficient or not to establish the guilt of the accused beyond reasonable doubt. The reason for placing the criminal prosecution under the direction and control of the fiscal is to prevent malicious or unfounded prosecutions by private persons. . . . Prosecuting officers under the power vested in them by the law, not only have the authority but also the duty of prosecuting persons who, according to the evidence received from the complainant, are shown to be guilty of a crime committed within the jurisdiction of their office. They have equally the duty not to prosecute when the evidence adduced is not sufficient to establish a prima facie case. This broad prosecutoral power is however nor unfettered, because just as public prosecutors are obliged to bring forth before the law those who have transgressed it, they are also constrained to be circumspect in filing criminal charges against the innocent. Thus, for crimes

cognizable by regional trial courts, preliminary investigations are usually conducted. In Ledesma v. Court of Appeals, purposes and nature of a preliminary investigation in this manner:

13

we discussed the

The primary objective of a preliminary investigation is to free respondent from the inconvenience, expense, ignominy and stress of defending himself/herself in the course of a formal trial, until the reasonable probability of his or her guilt in a more or less summary proceeding by a competent office designated by law for that purpose. Secondarily, such summary proceeding also protects the state from the burden of the unnecessary expense an effort in prosecuting alleged offenses and in holding trials arising from false, frivolous or groundless charges. Such investigation is not part of the trial. A full and exhaustive presentation of the parties' evidence is not required, but only such as may engender a well-grounded belief than an offense has been committed and that the accused is probably guilty thereof. By reason of the abbreviated nature of preliminary investigations, a dismissal of the charges as a result thereof is not equivalent to a judicial pronouncement of acquittal. Hence, no double jeopardy attaches. Judicial Determination of Probable Cause The determination of probable cause to hold a person for trial must be distinguished from the determination of probable cause to issue a warrant of arrest, which is a judicial function. The judicial determination of probable cause in the issuance of arrest warrants has been emphasized in numerous cases. In Ho v. People, 14 the Court summarized the pertinent rulings on the subject, as follows: The above rulings in Soliven, Inting and Lim, Sr. were iterated in Allado v. Diokno, where we explained again what probable cause means. Probable cause for the issuance of a warrant of arrest is the existence of such facts and circumstances that would lead a reasonably discreet and prudent person to believe that an offense has been committed by the person sought to be arrested. Hence, the judge, before issuing a warrant of arrest, "must satisfy himself that based on the evidence submitted, there is sufficient proof that a crime has been committed and that the person to be arrested is probably guilty thereof." At this stage of the criminal proceeding, the judge is not yet tasked to review in detail the evidence submitted during the preliminary investigation. It is sufficient that he personally evaluates such evidence in determining probable cause. In Webb v. De Leon we stressed that the judge merely determines the probability, not the certainty, of guilt of the accused and, in doing so, he need not conduct a de novo hearing. He simply personally reviews the prosecutor's initial determination finding probable cause to see if it is supported by substantial evidence. xxx xxx xxx In light of the aforecited decisions of this Court, such justification cannot be upheld. Lest we be too repetitive, we only emphasize three vital matters once more: First, as held in Inting, the determination of probable cause by the prosecutor is for a purpose different from that which is to be made by the judge. Whether there is reasonable ground to believe that the accused is guilty of the offense charged and should be held for trial is what the prosecutor passes upon. The judge, on the other hand, determines whether a warrant of arrest should be issued against the accused, i.e., whether there is a necessity for placing him under immediate custody in order not to frustrate the ends of justice. Thus, even if both should base their findings on one and the same proceeding or evidence, there should be no confusion as to their distinct objectives.

Second, since their objectives are different, the judge cannot rely solely on the report of the prosecutor in finding probable cause to justify the issuance of a warrant of arrest. Obviously and understandably, the contents of the prosecutor's report will support his own conclusion that there is reason to charge the accused of an offense and hold him for trial. However, the judge must decide independently. Hence, he must have supporting evidence, other than the prosecutor's bare report, upon which to legally sustain his own findings on the existence or non-existence of probable cause to issue an arrest order. This responsibility of determining personally and independently the existence of non-existence of probable cause is lodged in him by no less than the most basic law of the land. Parenthetically, the prosecutor could ease the burden of the judge and speed up the litigation process by forwarding to the latter not only the information and his bare resolution, but also so much of the records and the evidence on hand as to enable His Honor to make his personal and separate judicial finding on whether to issue a warrant of arrest. Lastly, It is not required that the complete or entire records of the case during the preliminary investigation be submitted to and examined by the judge. We do not intend to unduly burden trial courts by obliging them to examine the complete records of every case all the time simply for the purpose of ordering the arrest of the accused. What is required, rather, is that the judge must have sufficient supporting documents (such as the complaint, affidavits, counter-affidavits, sworn statements of witnesses or transcript of stenographic notes, if any) upon which to make his independent judgment, or at the very least, upon which to verify the findings of the prosecutor as to the existence of probable cause. The point is: he cannot rely solely and entirely on the prosecutor's recommendation, as the Respondent Court did in this case. Although the prosecutor enjoys the legal presumption of regularity in the performance of his duties and functions, which in turn gives his report the presumption of accuracy, the Constitution, we repeat, commands the judge to personally determine probable cause in the issuance of warrants of arrest. This Court has consistently held that a judge fails in his bounded duty if he relies merely on the certification or the report of the investigating officer. xxx xxx xxx Verily, a judge cannot be compelled to issue a warrant of arrest if he or she deems that there is no probable cause for doing so. Corollary to this principle, the judge should not override the public prosecutor's determination of probable cause to hold an accused for trial on the ground that the evidence presented to substantiate the issuance of an arrest warrant was insufficient, as in the present case. Indeed, it could be unfair to expect the prosecution to present all the evidence needed to secure the conviction of the accused upon the filing of the information against the latter. The reason is found in the nature and the objective of a preliminary investigation. Here, the public prosecutors do not decide whether there is evidence beyond reasonable doubt of the guilt of the person charged; they merely determine "whether there is sufficient ground to engender a well-founded belief that a crime . . . has been committed and that the respondent is probably guilty thereof, and should be held for trial." 15 Evidentiary matters must be presented and heard during the trial. 16 Therefore, if the information is valid on its face, and there is no showing of manifest error, grave abuse of discretion and prejudice on the part of the public prosecutor , the trial court should respect such determination. Inapplicabilty of Allado and Salonga The Court of Appeals anchored its ruling on the pronouncement made in Allado v. Diokno:" . . . [I]f, upon the filing of the information in court, the trial judge, after reviewing the information and the documents attached thereto, must either call for the complainant and the

witnesses themselves or simply dismiss the case. There is no reason to hold the accused for trial and further expose him to an open and public accusation of the crime when no probable cause exists." 17 In Allado, Petitioners Diosdado Jose Allado and Roberto I. Mendoza, practicing lawyers, were accused by the Presidential Anti-Crime Commission (PACC) of kidnapping with murder and ordered by Judge Roberto C. Diokno to be arrested without bail. The petitioners questioned the issuance of the warrants for their arrest contending that the respondent judge acted with grave abuse of discretion and in excess of his jurisdiction in holding that there was probable cause against them. They contended that the trial court relied merely on the resolution of the investigating panel and its certification that probable cause existed, without personally determining the admissibility and sufficiency of the evidence for such finding and without stating the basis thereof. They maintained that the records of the preliminary investigation, which was the sole basis of the judge's ruling, failed to establish probable cause against them that would justify the issuance of warrants for their arrest. The Court declared that Judge Diokno has indeed committed grave abuse of discretion in issuing the arrest warrants. Contrary to the constitutional mandate and established jurisprudence, he merely relied on the certification of the prosecutors as to the existence of the probable cause, instead of personally examining the evidence, the complainant and his witness." For otherwise," the Court said "he would have found out that the evidence thus far presented was utterly insufficient to warrant the arrest of the petitioners" 18 In categorically stating that the evidence so far presented did not meet the standard of probable cause and subsequently granting the petition, the Court noted the following circumstances: first, the corpus delicti was not established, and there was serious doubt as to the alleged victim's death: second, the extra judicial statement of the principal witness, who had priorly confessed his participation in the crime, was full of material inconsistencies; and third, the PACC operatives who investigated the case never implicated the petitioners. Citing Salonga v. Cruz-Pao, the Court of Appeals pointed out that when there was no prima facie case against a person sought to be charged with a crime, "the judge or fiscal, therefore, should not go on with the prosecution in the hope that some credible evidence might later turn out during trial, for this would be flagrant violation of a basic right which the courts are created to uphold." 19 In the aforecited case, Petitioner Jovito R. Salonga sought to bar the filing of an Information for violation of the revised Anti-Subversion Act, which Judge Ernani Cruz-Pano had ordered to be filed against him. In sustaining the petitioner, the Court held that the evidence upon which the Information was based was not sufficient to charge him for a violation of the Revised Subversion Act. In all, the Court decreed in both cases that there was no basis in law and in fact for the judicial and executive determination at probable cause. The Court also held that the government, while vested with the right and the duty to protect itself and its people against transgressors of the law, must perform the same in a manner that would not infringe the perceived violators' rights as guaranteed by the Constitution. However, the present case is not on all fours with Allado and Salonga. First, Elsa Gumban, the principal eyewitness to the killing of Rosalinda Dy, was not a participation or conspirator in the commission of the said crime. In Allado and Salonga, however, the main witnesses were the confessed perpetrators of the crimes, whose testimonies the court deemed 'tainted'. 20 Second, in the case at bar, the private respondent was accorded due process, and no precipitate haste or bias during the investigation of the case can be imputed to the public prosecutor. On the other hand, the Court noted in Allado the "undue haste in the filing of the Information and in the inordinate interest of the government" in pursuing the case; 21 and in Salonga, " . . . the failure of the prosecution to show that the petitioner was probably guilty of conspiring to commit the crime, the initial disregard of petitioner's constitutioner rights [and] the massive and damaging publicity against him." 22 In other words, while the respective sets of evidence before the prosecutors in the Allado and Salonga were "utterly insufficient" to support a finding of probable cause, the same cannot be said of the present case.

We stress that Allado and Salonga constitute exceptions to the general rule and may be invoked only if similar circumstances are clearly shown to exist. But as the foregoing comparisons show, such similarities are absent in the instant case. Hence, the rulings in the two aforementioned cases cannot apply to it. Motion Without Requisite Notice One more thing, Petitioners aver that Private Respondent Cerbo did not give them a copy of the Motion to Quash the Warrant of Arrest, which had been issued against him, or a notice of the scheduled hearing. Thus, they contend, Judge Valles should not have entertained such motion. It is settled that every written motion in a trial court must be set for hearing by the applicant and served with the notice of hearing thereof, in such a manner as to ensure its receipt by the other party. The provisions on this matter in Section 4 and 5, Rule 15 of the Rules of the Court, 23 are categorical and mandatory character. 24 Under Section 6 of the said rule, no motion shall be acted upon by the court without proof of service thereof. The rationale for this rule is simple: unless the movants set the time and the place of hearing, the court will be unable to determine whether the adverse parties agree or object to the motions, since the rules themselves do not fix any period within which they may file their replies or oppositions. 25 The motion to quash the warrant of arrest in the present case being pro forma, inasmuch as the requisite copy and notice were not duly served upon the adverse party, the trial court had no authority to act on it. Epilogue In granting this petition, we are not prejudging the criminal case or the guilt or innocence of Private Respondent Billy Cerbo. We simply saying that, as a general rule, if the information is valid on its face and there is no showing of manifest error, grave abuse of discretion or prejudice on the part of the public prosecutor, courts should not dismiss it for 'want of evidence,' because evidentiary matters should be presented and heard during the trial. The functions and duties of both the trial court and the public prosecutor in "the proper scheme of things" in our criminal justice system should be clearly understood. The rights of the people from what could sometimes be an ''oppressive" exercise of government prosecutorial powers do need to be protected when circumstances so require. But just as we recognize this need, we also acknowledge that the State must likewise be accorded due process. Thus, when there is no showing of nefarious irregularity or manifest error in the performance of a public prosecutor's duties, courts ought to refrain from interfering with such lawfully and judicially mandated duties. In any case, if there was palpable error or grave abuse of discretion in the public prosecutor's finding of probable cause, the accused can appeal such finding to the justice secretary 26 and move for the deferment or suspension of the proceeding until such appeal is resolved. WHEREFORE, the petition is GRANTED. The assailed Decision of the Court of Appeals is hereby REVERSED and SET ASIDE. The case is REMANDED to the Regional Trial Court of Nabunturan, Davao, which is ordered to reinstate the amended information against Private Respondent Billy Cerbo and to proceed with judicious speed in hearing the case. No. costs. 1wphi1.nt SO ORDERED.

Republic of the Philippines SUPREME COURT Manila FIRST DIVISION G.R. No. 132007 August 5, 1998 SOLAR TEAM ENTERTAINMENT, INC., petitioner, vs. HON. HELEN BAUTISTA RICA-FORT, in her capacity as Presiding Judge of the Regional Trial Court of Paraaque, Metro Manila (Branch 260), TEAM IMAGE ENTERTAINMENT, INC., FELIX S. CO, JEFFREY C. CAL, and KING CUISIA, respondents. DAVIDE, JR., J.: At issue is whether respondent judge committed grave abuse of discretion amounting to lack or excess of jurisdiction in denying petitioner's motion to expunge private respondents' answer with counterclaims on the ground that said pleading was not served personally; moreover, there was no written explanation as to why personal service was not accomplished, as required by Section 11 of Rule 13 of the 1997 Rules of Civil Procedure. The antecedents are not disputed. On 10 July 1997, petitioner, as plaintiff, filed before the Regional Trial Court (RTC) in Paraaque, Metro Manila, a complaint for recovery of possession and damages with prayer for a writ of replevin 1 against herein private respondents. The case was docketed as Civil Case No. 970304 and was assigned to Branch 260 of said court, presided over by public respondent Judge Helen Bautista-Ricafort. Summonses and copies of the complaint were forthwith served on private respondents. On 25 July 1997, their counsel filed a notice of appearance with urgent ex-parte motion for extension of time to plead, 2 which the court granted in its order of 4 August 1997. 3 On 8 August 1997, private respondents, as defendants, filed their "Answer (with Counterclaims).'' 4 A copy thereof was furnished counsel for petitioner by registered mail; however, the pleading did not contain any written explanation as to why service was not made personally upon petitioner-plaintiff, as required by Section 11 of Rule 13 of the 1997 Rules of Civil Procedure. On 11 August 1997, petitioner filed a motion to expunge the "Answer (with Counterclaims)" and to declare herein private respondents in default, 5 alleging therein that the latter did not observe the mandate of the aforementioned Section 11, and that there was: [A]bsolutely no valid reason why defendant[s] should not have personally served plaintiff's . . . counsel with [a] copy of their answer [as] (t)he office of defendant's ( sic) counsel, Atty. Froilan Cabaltera, is just a stone [ sic] throw away from the office of [petitioner's] counsel, with an estimate (sic) distance of about 200 meters more or less. Petitioner further alleged that the post office was "about ten (10) times farther from the office of Atty. Cabaltera,"

On 15 August 1997, private respondents filed their opposition 6 to the abovementioned motion, alleging that petitioner's "rigid and inflexible reliance on the provisions of Section 11, Rule 13 . . . is an adventitious resort to technicality and is contrary to Section 6 of Rule 3 . . . which admonishes that said Rules 'shall be liberally construed in order to promote their objective in securing a just, speedy and i nexpensive disposition of [e]very action and proceeding;'" and that Section 11, Rule 13 notwithstanding, private respondents "religiously complied with [Section 5 of Rule 13] by personally present[ing] to the clerk of court their said Answer . . . furnishing a copy thereof to the counsel for [petitioner] by way of registered mail." On 8 September 1997, public respondent Judge Bautista-Ricafort issued an order 7 stating that under Section 11 of Rule 13 "it is within the discretion of the [trial court] whether to consider the pleading as filed or not," and denying, for lack of merit, petitioner's motion to expunge the "Answer (with Counterclaims)" and to declare private respondents in default. Petitioner immediately moved for reconsideration 8 of the order, but public respondent Judge Bautista-Ricafort denied this motion in her order 9 of 17 November 1997. The order justified the denial in this wise: Sec. 6 [of] Rule 1 of the 1997 Rules of Civil Procedure ordains that the Rules shall be liberally construed in order to promote their objective of securing a just, speedy and inexpensive disposition of every action and proceeding. Liberal construction of the rules and the pleading is the controlling principle to effect substantial justice. As pointed out by the Supreme Court in Alonso vs. Villamor, 16 Phil. 315, "the error in this case is purely technical. To take advantage of it for other purposes than to cure it, does not appeal to a fair sense of justice. Its presentation as fatal to plaintiff a [sic] case smacks of skill rather than right. A litigation is not a game of technicalities in which one, more deeply schooled and skilled in the subtle art of movement and position, entraps and destroys the other. It is rather, a contest in which each contending party fully and fairly lays before the Court the facts in issue and then, brushing aside as wholly trivial and indecisive all imperfections or form of technicalities of procedure, asks that justice be done upon the merits. Lawsuits, unlike duels, are not to be won by a rapier's thrust." While it is desirable that the above Rules be faithfully and even meticulously observed, courts should not strict about procedural lapses that do not really impair the proper administration of justice. Furthermore, it is well settled that litigations should, as much as possible be decided on their merits and not on technicalities. Petitioner thus filed the instant special civil action of certiorari, contending that public respondent Judge Bautista-Ricafort committed grave abuse of discretion amounting to lack or excess of jurisdiction when she admitted private respondents' "Answer (with Counterclaims)" notwithstanding private respondents' clear, admitted and inexcusable violation of Section 11, Rule 13 of the 1997 Rules of Civil Procedure, in that: (a) the "Answer (with Counterclaims)" was not served personally upon petitioner's counsel despite the undisputed fact that the offices of private respondents' counsel and that of petitioner's counsel are only about 200 meters away from each other; and (b) the Answer did not contain any explanation as to why the answer was not served personally. In their Comment, filed in compliance with the resolution of 2 February 1998, and to which petitioner filed a Reply, private respondents aver that public respondent Judge Bautista-Ricafort correctly admitted private respondents' "Answer (with Counterclaims)" in light of Section 6, Rule 1 of the 1997 Rules of Civil Procedure; that Section 11 of Rule 13 begins with the phrase "whenever practicable," thereby suggesting that service by mail may still be effected depending on the relative priority of the pleading sought to be filed; and when service is not done

personally, it is more prudent and judicious for the courts to require a written explanation rather than to expunge the pleading outright or consider the same as not being filed. In view of the importance of the issue raised, which is, undoubtedly, one of the first impression, the Court resolved to give due course to the petition and consider it submitted for decision on the basis of the pleadings filed by the parties. Sec. 5, Rule 13 of the 1997 Rules of Civil Procedure prescribes two modes of service of pleadings, motions, notices, orders, judgments and other papers, namely: (1) personal service; and (2) service by mail. The first is governed by Section 6, while the second, by Section 7 of said Rule. If service cannot be done either personally or by mail, substituted service may be resorted to under Section 8 thereof. Pursuant, however, to Section 11 of Rule 13, service and filing of pleadings and other papers must, whenever practicable, be done personally; and if made through other modes, the party concerned must provide a written explanation as to why the service or filing was not done personally. The section reads: Sec. 11. Priorities in modes of service and filing. Whenever practicable, the service and filing of pleadings and other papers shall be done personally. Except with respect to papers emanating from the court, a resort to other modes must be accompanied by a written explanation why the service or filing was not done personally. A violation of this Rule may be cause to consider the paper as not filed. (n) Note that Section 11 refers to both service of pleadings and other papers on the adverse party or his counsel as provided for in Sections 6, 7 and 8; and to the filing of pleadings and other papers in court. Personal service and filing are preferred for obvious reasons. Plainly, such should expedite action or resolution on a pleading, motion or other paper; and conversely, minimize, if not eliminate, delays likely to be incurred if service or filing is done by mail, considering the inefficiency of the postal service. Likewise, personal service will do away with the practice of some lawyers who, wanting to appear clever, resort to the following less than ethical practices: (1) serving or filing pleadings by mail to catch opposing counsel off-guard, thus leaving the latter with little or no time to prepare, for instance, responsive pleadings or an opposition; or (2) upon receiving notice from the post office that the registered parcel containing the pleading of or other paper from the adverse party may be claimed, unduly procrastinating before claiming the parcel, or, worse, not claiming it at all, thereby causing undue delay in the disposition of such pleading or other papers. If only to underscore the mandatory nature of this innovation to our set of adjective rules requiring personal service whenever practicable, Section 11 of Rule 13 then gives the court the discretion to consider a pleading or paper as not filed if the other modes of service or filing were resorted to and no written explanation was made as to why personal service was not done in the first place. The exercise of discretion must, necessarily, consider the practicability of personal service, for Section 11 itself begins with the clause "whenever practicable." We thus take this opportunity to clarify that under Section 11, Rule 13 of the 1997 Rules of Civil Procedure, personal service and filing is the general rule, and resort to other modes of service and filing, the exception. Henceforth, whenever personal service or filing is practicable, in light of the circumstances of time, place and person, personal service or filing is mandatory. Only when personal service or filing is not practicable may resort to other modes be had, which must then be accompanied by a written explanation as to why personal service or filing was not practicable to begin with. In adjudging the plausibility of an explanation, a court shall likewise consider the importance of the subject matter of the case or the issues involved therein, and the prima facie merit of the pleading sought to be expunged for violation of Section 11. This Court cannot rule otherwise, lest we allow circumvention of the innovation introduced by the 1997 Rules in order to obviate delay in the administration of justice.

Here, the proximity between the offices of opposing counsel was established; moreover, that the office of private respondents' counsel was "ten times farther" from the post office than the distance separating the offices of opposing counsel. Of course, proximity would seem to make personal service most practicable, but exceptions may nonetheless apply. For instance, where the adverse party or opposing counsel to be served with a pleading seldom reports to office and no employee is regularly present to receive pleadings, or where service is done on the last day of the reglementary period and the office of the adverse party or opposing counsel to be served is closed, for whatever reason. Returning, however, to the merits of this case, in view of the proximity between the offices of opposing counsel and the absence of any attendant explanation as to why personal service of the answer was not effected, indubitably, private respondents' counsel violated Section 11 of Rule 13 and the motion to expunge was prima facie meritorious. However, the grant or denial of said motion nevertheless remained within the sound exercise of the trial court's discretion. Thus, as guided by Section 6, Rule 1 of the 1997 Rules of Civil Procedure, which ordains that the Rules shall be liberally construed in order to promote their objective of securing a just, speedy and inexpensive disposition of every action or proceeding, as well as by the dictum laid down in Alonso v. Villamor, 16 Phil. 315 [1910], the trial court opted to exercise its discretion in favor of admitting the "Answer (with Counterclaims)," instead of expunging it from the record. To our mind, if motions to expunge or strike out pleadings for violation of Section 11 of Rule 13 were to be indiscriminately resolved under Section 6 of Rule 1 or Alonzo v. Villamor and other analogous cases, then Section 11 would become meaningless and its sound purpose negated. Nevertheless, we sustain the challenged ruling of the trial court, but for reasons other than those provided for in the challenged order. The 1997 Rules of Civil Procedure took effect only on 1 July 1997, while the questioned "Answer (with Counterclaims)" was filed only on 8 August 1997, or on the 39th day following the effectivity of the 1997 Rules. Hence, private respondents' counsel may not have been fully aware of the requirements and ramifications of Section 11, Rule 13. In fact, as pointed out by petitioner's counsel, in another case where private respondents' counsel was likewise opposing counsel, the latter similarly failed to comply with Section 11. It has been several months since the 1997 Rules of Civil Procedure took effect. In the interim, this Court has generally accommodated parties and counsel who failed to comply with the requirement of a written explanation whenever personal service or filing was not practicable, guided, in the exercise of our discretion, by the primary objective of Section 11, the importance of the subject matter of the case, the issues involved and the prima facie merit of the challenged pleading. However, as we have in the past, for the guidance of the Bench and Bar, strictest compliance with Section 11 of Rule 13 is mandated one month from promulgation of this Decision. WHEREFORE, the instant petition is DISMISSED considering that while the justification for the denial of the motion to expunge the "Answer (with Counterclaims)" may not necessarily be correct, yet, for the reasons above stated, the violation of Section 11 of Rule 13 may be condoned. No pronouncement as to costs. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila FIRST DIVISION G.R. No. 147989 ROLANDO CLAVECILLA, Petitioner, vs. TERESITO QUITAIN and RICO QUITAIN, et al., Respondents. DECISION AUSTRIA-MARTINEZ, J.: Before this Court is a petition for review on certiorari assailing the Resolution1 of the Court of Appeals (CA) dated October 5, 2000 which dismissed Rolando Clavecillas petition on the ground that the verification and certification of non -forum shopping was signed by counsel without the proper authority from petitioner, as well as the Resolution dated March 28, 2001 2 which denied petitioners motion for reconsideration. The facts are as follows: Teresito and Rico Quitain (Quitains) filed on March 7, 1997, a complaint against Rolando Clavecilla (Clavecilla) before the Municipal Trial Court in Cities, Branch 6, Davao City (MTCC) for the enforcement of the amicable settlement entered into by them on August 19, 1996 before the Lupon Tagapamayapa, Barangay Talomo, Davao. Pertinent portions of said settlement reads: 1. That the respondent (Clavecilla) agreed to purchase the property on October 15, 1996. 2. Failure to pay the property on the said date the respondent will voluntarily vacate the place with the assistance of five thousand (P5,000.00) pesos only. 3. The complainant (Rico Quitain) agreed to the demand of the respondent. 3 The Quitains alleged that Clavecilla failed to pay the amount agreed upon and six months had already passed since the agreement was entered into and yet Clavecilla has still not left the premises.4 Clavecilla answered that the August 19, 1996 agreement was no longer enforceable since it was novated by an agreement dated October 29, 1996.5 Said agreement reads: xxx February 20, 2006

1. That both parties agreed to meet again on Nov. 5, 1996 at the Barangay for another round of talk (sic). 2. That on Nov. 5, 1996 the respondent will pay the 50% total amount of the selling price of the said lot, 111 sq.m. more or less located at Lot 1989-A being a portion of Lot 1989 (T.C.T. # T-6615) at Talomo proper. 3. Price per sq.m. P1,000.00 only. 4. Failure to accomplished (sic) this Nov. 5, 1996 requirement, the respondent will voluntarily vacate the said lot with a P5,000.00 assistance for their effort. 5. All agreement is final upon signing.6 xxx Clavecilla claims that on November 5, 1996, he appeared at the barangay and was supposed to pay Quitains the 50% price of the lot in question but they were not present.7 Rico Quitain asserts however that he was present that day as shown by a certification made by the office of the lupon of said barangay.8 On March 8, 2000, the MTCC rendered its Decision in favor of the Quitains finding that there was no novation, as the October 29, 1996 was not incompatible with the August 19, 1996 agreement but was only a reiteration of the earlier agreement. 9 Clavecilla filed a notice of appeal.10 On June 20, 2000, the Regional Trial Court of Davao City, Branch 33 (RTC) dismissed the appeal for Clavecillas failure to fi le the memorandum on appeal within the period prescribed by the Rules.11 Clavecilla filed a Motion for Reconsideration and For Leave of Court to Admit Appeal Memorandum claiming that his counsel was not able to file the memorandum on appeal on time since said counsel was diagnosed with pneumonia and had to rest for more than ten days. 12 Clavecilla then filed an Appeal Memorandum claiming that the MTCC erred in rendering judgment against him since he did not sign the agreement but it was his wife Erlinda who signed the same without authority from him. 13 On July 5, 2000, the RTC denied Clavecillas motion stating that the reason advanced by Clavecillas counsel for his failure to file the appeal memorandum on time is not a compelling reason, and even if such memorandum was given due course, the arguments raised by Clavecilla therein are not sufficient to justify a reversal of the Decision of the lower court. 14 Petitioner filed another motion for reconsideration dated July 21, 2000 which was denied by the RTC on the same day. 15 On September 13, 2000, petitioner filed a petition for review under Rule 42 of the Rules of Court with the CA which rendered the herein assailed Resolution on October 5, 2000 thus: The Verification and Certification of non-forum shopping, which accompanied the petition at bench, was executed and signed by petitioners counsel Atty. Oswaldo A. Macadangdang, without the proper authority from petitioner, in violation of Sec. 5, Rule 7 and Sec. 2, Rule 42 of the

1997 Rules of Civil Procedure. The duty to certify under oath is strictly addressed to petitioner, Rolando Clavecilla. To allow delegation of said duty to anyone would render Revised Circular No. 28-91 inutile.16 xxx xxxx Accordingly, the Court Resolves to DENY DUE COURSE and to DISMISS the petition. SO ORDERED.17 Petitioners motion for reconsideration was also denied on March 28, 2001 as follows: Petitioner moves for the reconsideration of our Resolution dated 05 October 2000 dismissing the petition for the reason that the certificate of non-forum shopping was signed by petitioners counsel and not by the petitioner. 1avvphil.net Admitting that the duty to sign under oath the certificate is addressed to the petitioner, petitioner attached to his motion a Special Power of Attorney dated 09 August 2000 authorizing his counsel to sign the certificate. The court believes that this authorization was made after the petition had been filed, in a vain attempt to cure the fatal defect, for if Atty. Maca[d]angdang had such authority, he would have indicated that in the Verification and Certification he signed on 25 August 2000 attached to the petition. In any event, it is a settled rule that the certificate against forum shopping must be executed by the petitioner and not by counsel. xxx To merit the Courts Consideration, petitioner must show reasonable cause for failure to personally sign the certification. x x x This petitioner failed to show. (citations omitted) WHEREFORE, the Motion for Reconsideration is DENIED for lack of merit. SO ORDERED.18 Hence, the present petition alleging that: THE HONORABLE COURT OF APPEALS ERRED IN DEPARTING FROM THE ACCEPTED JURISPRUDENCE OF ALLOWING LIBERAL INTERPRETATION OF THE RULES OF COURT PROVIDED PETITIONER SUBSTANTIALLY COMPLIED WITH CIRCULAR NO. 28-91 AS SHOWN IN THE SPECIAL POWER OF ATTORNEY WHICH HE ATTACHED TO HIS MOTION FOR RECONSIDERATION.19 Petitioner avers that: his lawyer had the authority to sign the certification against forum shopping; the CA was hasty in concluding that the authorization of petitioners lawyer was made after the petition had been filed; the CA should have granted petitioner the be nefit of the doubt that he gave such authorization to his lawyer at the time that his lawyer signed the verification and certification against forum shopping; petitioners failure to have a properly executed certification against forum shopping attached to his petition for review is not fatal; the rules of procedure are used only to help secure and not override substantial justice, and the CA departed from the established liberal interpretation of the rules despite petitioners substantial compliance with the rule on non -forum shopping.20

Rico Quitain in his Comment countered that: the petition is not sufficient in form and substance and is utterly deficient in factual and procedural bases; petitioner named "Teresito Quitain, Rico Quitain, et al." as respondents without specifying who "et al." referred to; Teresito Quitain is already deceased and the MTCC as early as June 5, 1998 already ordered Teresitos substitution; the spouse and chi ldren of Teresito, to wit, Lolita, Rene, Ruel, Radi and Romy, all surnamed Quitain, have the right to be informed of the filing of the petition and the fact that they were not so specifically named as respondents but were referred to as "et al." makes the petition a sham pleading; petitioner failed to attach certified true copies of the MTCC Decision dated March 8, 2000 and the RTC Order dated July 5, 2000 which should have been included as annexes in the present petition as they are material to the case, and the petition does not allege a good and valid defense which, if appreciated, could probably cause the reversal of the July 5, 2000 and March 8, 2000 issuances.21 The parties filed their respective Memoranda reiterating their respective contentions.22 After evaluating the records of the case and the issues raised by the parties, the Court finds that the CA did not err in denying the petition and motion for reconsideration filed by Clavecilla before it. The Court however finds different grounds for denying Clavecillas p etition. First, it must be determined whether there existed a special power of attorney in favor of petitioners counsel when the p etition before the CA was filed. The CA in its Resolution dated March 28, 2001, stated that it believes that the special power of attorney in favor of the lawyer attached to petitioners motion for reconsideration was only made after the petition had been filed reasoning that if the counsel had such authority from the beginning, he would have attached the same when the petition was first filed. The Court disagrees. The rule is that any suspicion on the authenticity and due execution of the special power of attorney which is a notarized document, thus a public document, cannot stand against the presumption of regularity in their favor absent evidence that is clear, convincing and more than merely preponderant.23 In this case, the petition before the CA was filed on September 13, 2000. 24 The special power of attorney meanwhile was dated August 9, 2000.25 Absent any proof that the special power of attorney was not actually in existence before the petition was filed, this Court has no recourse but to believe that it was indeed in existence at such time. The next matter to be determined is whether the CA was correct in dismissing Clavecillas petition and motion for reconsidera tion, notwithstanding the authority given by Clavecilla in favor of his lawyer to sign the verification and certification in his behalf. The Court answers in the affirmative. Obedience to the requirements of procedural rules is needed if we are to expect fair results therefrom, and utter disregard of the rules cannot justly be rationalized by harking on the policy of liberal construction. 26 Time and again, this Court has strictly enforced the requirement of verification and certification of non-forum shopping under the Rules of Court.27 This case is no exception. Verification is required to secure an assurance that the allegations of the petition have been made in good faith, or are true and correct and not merely speculative.28

In this case, petitioners counsel signed the verifica tion alleging that he had read the petition and the contents thereof are true and correct of his own "knowledge and belief."29 On this ground alone, the petition should already be dismissed for as provided for in Section 4 Rule 7 of the Rules of Court, as amended by A.M. No. 00-2-10-SC dated May 1, 2000: Sec. 4. Verification. ---xxx A pleading is verified by an affidavit that the affiant has read the pleading and that the allegations therein are true and correct of his personal knowledge or based on authentic records.1avvphil.net A pleading required to be verified which contains a verification based on "information and belief," or upon "knowledge, information and belief," or lacks a proper verification, shall be treated as an unsigned pleading. While the Court has exercised leniency in cases where the lapse in observing the rules was committed when the rules have just recently taken effect,30 the attendant circumstances in this case however do not warrant such leniency. 1avvphil.net The certification against forum shopping in this case was signed by petitioners counsel despite the clear requirement of the law that petitioners themselves must sign the certification. The certification must be made by petitioner himself and not by counsel, since it is petitioner who is in the best position to know whether he has previously commenced any similar action involving the same issues in any other tribunal or agency.31 And the lack of a certification against forum shopping, unlike that of verification, is generally not cured by its submission after the filing of the petition.32 As explained by this Court in Gutierrez v. Sec. of Dept. of Labor and Employment:33 x x x [T]he certification (against forum shopping) must be signed by the plaintiff or any of the principal parties and not by the attorney. For such certification is a peculiar personal representation on the part of the principal party, an assurance given to the court or other tribunal that there are no other pending cases involving basically the same parties, issues and causes of action. x x x Obviously it is the petitioner, and not always the counsel whose professional services have been retained for a particular case, who is in the best position to know whether he or it actually filed or caused the filing of a petition in that case. Hence, a certification against forum shopping by counsel is a defective certification.34 In Mariveles Shipyard Corp. v. Court of Appeals,35 this Court further elucidated that: x x x In the case of natural persons, the Rule requires the parties themselves to sign the certificate of non-forum shopping. x x x [I]n the case of the corporations, the physical act of signing may be performed, on behalf of the corporate entity, only by specifically authorized individuals for the simple reason that corporations, as artificial persons, cannot personally do the task themselves.36 (emphasis supplied) In the case of Santos v. Court of Appeals,37 the Court further clarified, that even with a special power of attorney executed by the petitioners in favor of their counsel to sign the certification on their behalf, still the rule stands. Thus:

We are aware of our ruling in BA Savings Bank v. Sia that a certification against forum shopping may be signed by an authorized lawyer who has personal knowledge of the facts required to be disclosed in such document. However, BA Savings Bank must be distinguished from the case at bar because in the former, the complainant was a corporation, and hence, a juridical person. Therefore, that case made an exception to the general rule that the certification must be made by the petitioner himself since a corporation can only act through natural persons. In fact, physical actions, e.g., signing and delivery of documents, may be performed on behalf of the corporate entity only by specifically authorized individuals. In the instant case, petitioners are all natural persons and there is no showing of any reasonable cause to justify their failure to personally sign the certification . It is noteworthy that PEPSI in its Comment stated that it was petitioners themselves who executed the verification and certification requirements in all their previous pleadings. Counsel for petitioners argues that as a matter of policy, a Special Power of Attorney is executed to promptly and effectively meet any contingency relative to the handling of a case. This argument only weakens their position since it is clear that at the outset no justifiable reason yet existed for counsel to substitute petitioners in signing the certification. In fact, in the case of natural persons, this policy serves no legal purpose. Convenience cannot be made the basis for a circumvention of the Rules.38 (emphasis supplied) While there are cases when the Court has relaxed the rule requiring that in case of a natural person, he shall personally sign the non-forum shopping certification, in such cases the Court found compelling and justifiable reasons to relax observance of the rules. In Donato v. Court of Appeals39 and Wee v. Galvez40 the Court noted that the petitioners were already in the United States, thus the signing of the certification by their authorized representatives was deemed sufficient compliance with the rules. In Orbeta v. Sendiong41 the Court found that the annulment of judgment filed by the parties was meritorious thus the certification signed by the daughter of petitioner who had a general power of attorney in her favor was deemed sufficient. In Sy Chin v. Court of Appeals42 the Court also upheld substantial justice and ruled that the failure of the parties to sign the certification may be overlooked as the parties case was meritorious. No such justifiable or compelling reasons exist in the case at bar. In this case, petitioner did not present any cause for his failure to personally sign the certification against forum shopping at the time that the petition was filed at the CA. He merely acknowledged in his motion for reconsideration of the October 5, 2000 Resolution of the CA that he "has the duty to certify under oath."43 He then asked for a reconsideration of the said Resolution and attached a Special Power of Attorney executed by him in favor of his lawyer.44 There is also no showing that there is substantial merit in petitioners claims. In his petition before the CA and in his App eal Memorandum filed with the RTC, petitioner argues that he is not a party to the amicable settlement as it was his wife who signed the same without authority from him.45 Petitioner in his Answer however admitted having entered into an agreement with the Quitains, before the lupon of their barangay on August 19, 1996.46 Petitioner also claims that the August 19, 1996 agreement was novated by the one dated October 29, 1996. The claim has no merit. Novation cannot be presumed but must be clearly shown either by the express assent of the parties or by the complete incompatibility between the old and the new agreements.47 In this case, the October 29, 1996 agreement merely held that the parties shall meet again on November 5, 1996 at which time petitioner shall pay 50% of the purchase price or he will vacate the property. His obligation to pay the purchase price or to vacate the property in case of his failure to do so, still exists and was not extinguished by the October 29, 1996 agreement.

Records also show that Rico Quitain was ready to comply with his part of the agreement as he was present at the barangay on November 5, 1996 to receive the payment from Clavecilla.48 Quitain also consigned the amount of P5,000.00 to the court, which is the amount he agreed to give Clavecilla to assist him and his family when they leave the property.49 As correctly pointed out by the RTC, even if petitioners appeal was allowed to proceed, still the arguments raised are not s ufficient to overturn the ruling of the MTCC. It is also worth mentioning that the petitioner erred in including the name of Teresito in the caption of the petition and using only the phrase "et al." to refer to the heirs who substituted him after his death. As pointed out by respondent Rico Quitain, Teresito is already deceased and was already substituted by his heirs, namely: Lolita, widow of Teresito, Rene, Ruel, Radi, and Romy, sons of Teresito, in the Order of the MTCC dated June 5, 1998.50 Consequently, the above-named heirs are deemed co-respondents in the present petition. WHEREFORE, the petition is DENIED for lack of merit. Costs against petitioner. SO ORDERED.