CALOOCAN V.

CA
2006 May 3

The mayor has the authority to file suits "for the recovery of funds and property" on behalf of the city,
even without the prior authorization from the Sanggunian Panglungsod

petitioner: City of Caloocan

represented by REYNALDO O. MALONZO, in his capacity as City Mayor


respondent GOTESCO INVESTMENTS, INC., JOSE GO

buyer in the contract


YOLANDA O. ALFONSO

in her capacity as Register of Deeds of Caloocan City

1. In 1990, when Asistio was mayor, the Sangguniang Panlungsod of Caloocan City passed Ordinance No. 068 s. 1990 authorizing then
Mayor Macario Asistio, Jr. to negotiate and enter into a contract of sale of the patrimonial property of the city comprising of 22,685.82
square meters covered by TCT No. 5432.
2. A deed of absolute sale was made selling the property to Ever Gostesco for P136,114,800.00
3. However, the Commission on Audit disapproved of the sale because the selling price was too low.
4. Sanggunian passed another ordinance amending the first one, increasing the price of the property to P182 million, pursuant to the COA
decision. The Sanggunian also directed that an amended deed of absolute sale be executed between the City and Gotesco.
5. Malonzo vetoed the (latest) ordinance on the ground that since the deed of sale earlier executed was valid and subsisting because
according to him, it was not incumbent upon him to execute an amended deed of conveyance over the same property
6. The Sanggunian still passed Resolution No. 0609 overriding the veto
7. Gotesco executed an "Express Consent to the Novation of the Deed of Absolute Sale" with an "Amended Deed of Absolute Sale"
embodying the amendments prescribed by the latest ordinance wherein it agreed to buy the subject property for P182,085,078.30.
Malonzo received the documents but refused to sign the amended deed of sale.
8. Despite Malonzos refusal to sign the amended deed of sale and the refusal of the mayor to accept the P182 million as payment for the
property, the DILG opined that the deed of absolute sale may be registered with the Register of Deeds of Caloocan City, the registration
being a mere ministerial act on the part of the latter.
9. Thus Malonzo filed two cases, a case for injunction to prevent the registration of the sale (C-18308), and a civil case for the annulment of
the sale (C-18337).
10. Gotesco, on the other hand, filed to consign the amount in court to effect payment on the transaction.
11. The CA, however, dismissed Malonzos Civil case with number C-18337, prompting him to file the present petition.

Malonzo Gotesco SC
1. I vetoed the (latest) ordinance on
the ground that since the deed of
sale earlier executed was valid and
subsisting it was not incumbent
upon me to execute an amended
deed of conveyance over the same
property.

1. Wants to consign the amount
before the court to effect payment.
1. The consignment is not an issue in this case, since it is
another civil case still pending with the RTC. The main issue in
this case is whether the CA correctly dismissed C-18337 on the
ground of forum shopping.
2. On forum shopping, Malonzo
says that C-18337 should not have
been dismissed because it has a
different cause of action than that
of C-18308. Thus, any judgment on
either of the two cases will not
result in res judicata in the other
case.
2. C-18337 should be dismissed
because it has the same causes of
action with C-18308. Also, Malonzo
does not have the authority from the
Sanggunian to prosecute the two
cases that he filed.
2. SC first resolved the issue on whether Malonzo had the
right to prosecute the case even without the authorization
from the Sanggunian. SC cited Sec. 445 of the LGC. And ruled
that it is clear that the mayor has the authority to file suits
for the recovery of funds and property on behalf of the city,
even without the prior authorization from the Sanggunian.

However, SC upheld the CA ruling dismissing the case on the
ground of forum shopping because the certificate on non-
forum shopping was signed not by Malonzo but by the City
Legal Officer; and the SC found that C-18337 is dismissible on
the ground of litis pendentia. The aforesaid cases are
intimately related and/or intertwined with one another such
that the judgment that may be rendered in one would amount
to res judicata in the other.

The Court finds that the cases involve the same principal
parties, while the others were merely impleaded as nominal
parties. As this court has previously held, absolute identity of
parties is not required. It is enough that there is substantial
identity of parties.

Held: that there was forum shopping, and CA was correct in
dismissing C-18337.