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Lazatin vs.

Desierto

FACTS:

The Fact-Finding and Intelligence Bureau of the Office of the Ombudsman filed a Complaint-
Affidavit charging petitioners (Lazatin) with Illegal Use of Public Funds.

A preliminary investigation was conducted and it was recommened that 14 counts each of
Malversation of Public Funds and violation of Section 3 (e) of R.A. No. 3019 should be filed
against the petitioners. Resolution was approved by the Ombudsman; hence, 28 Informations
were filed before the Sandiganbayan.

Petitioner Lazatin and his co-petitioners then filed their respective Motions for
Reconsideration/Reinvestigation, which motions were granted by the Sandiganbayan. The
Sandiganbayan also ordered the prosecution to re-evaluate the cases against petitioners.

The Office of the Special Prosecutor(OSP) submitted to the Ombudsman its Resolution which
recommended the dismissal of the cases against petitioners for lack or insufficiency of
evidence.

The Ombudsman ordered the Office of the Legal Affairs (OLA) to review the OSP Resolution.
In a Memorandum, the OLA recommended that the OSP Resolution be disapproved and the
OSP be directed to proceed with the trial of the cases against petitioners. The
Ombudsman adopted the OLA Memorandum, thereby disapproving the OSP Resolution
and ordering the prosecution of the subject cases. The cases were then returned to the
Sandiganbayan for continuation of criminal proceedings.

Petitioners filed the instant petition.

Petitioners argue that the Ombudsman had no authority to overturn the OSP's
Resolution dismissing the cases against petitioners because, under Section 13, Article XI
of the 1987 Constitution, the Ombudsman is clothed only with the power to watch,
investigate and recommend the filing of proper cases against erring officials, but it was
not granted the power to prosecute. They point out that under the Constitution, the power
to prosecute belongs to the OSP, which was intended by the framers to be a separate and
distinct entity from the Office of the Ombudsman. Petitioners conclude that, as provided by
the Constitution, the OSP being a separate and distinct entity, the Ombudsman should have
no power and authority over the OSP. Thus, petitioners maintain that R.A. No. 6770 (The
Ombudsman Act of 1989), which made the OSP an organic component of the Office of the
Ombudsman, should be struck down for being unconstitutional.

The Court finds the petition unmeritorious.

Petitioners' attack against the constitutionality of R.A. No. 6770 is stale. It has long
been settled that the provisions of R.A. No. 6770 granting the Office of the Ombudsman
prosecutorial powers and placing the OSP under said office have no constitutional infirmity.
The issue of whether said provisions of R.A. No. 6770 violated the Constitution had
been fully dissected as far back as 1995 in Acop v. Office of the Ombudsman : The Court
held that giving prosecutorial powers to the Ombudsman is in accordance with the
Constitution as paragraph 8, Section 13, Article XI provides that the Ombudsman shall
“exercise such other functions or duties as may be provided by law.”
The constitutionality of Section 3 of R.A. No. 6770, which subsumed the OSP under the
Office of the Ombudsman, was likewise upheld by the Court in Acop. It was explained, thus:

x x x Section 7 of Article XI expressly provides that the then existing


Tanodbayan, to be henceforth known as the Office of the Special
Prosecutor, “shall continue to function and exercise its powers as now or
hereafter may be provided by law, except those conferred on the Office of
the Ombudsman created under this Constitution.” The underscored phrase
evidently refers to the Tanodbayan's powers under P.D. No. 1630 or
subsequent amendatory legislation. It follows then that Congress may
remove any of the Tanodbayan's/Special Prosecutor's powers under
P.D. No. 1630 or grant it other powers, except those powers conferred
by the Constitution on the Office of the Ombudsman.

Pursuing the present line of reasoning, when one considers that by


express mandate of paragraph 8, Section 13, Article XI of the Constitution,
the Ombudsman may “exercise such other powers or perform functions or
duties as may be provided by law,” it is indubitable then that Congress has
the power to place the Office of the Special Prosecutor under the Office of
the Ombudsman. In the same vein, Congress may remove some of the
powers granted to the Tanodbayan by P.D. No. 1630 and transfer them to
the Ombudsman; or grant the Office of the Special Prosecutor such other
powers and functions and duties as Congress may deem fit and wise. This
Congress did through the passage of R.A. No. 6770.

The foregoing ruling of the Court has been reiterated in Camanag v. Guerrero. More
recently, in Office of the Ombudsman v. Valera, the Court, basing its ratio decidendi on its
ruling in Acop and Camanag, declared that the OSP is “merely a component of the Office
of the Ombudsman and may only act under the supervision and control, and upon
authority of the Ombudsman” and ruled that under R.A. No. 6770, the power to preventively
suspend is lodged only with the Ombudsman and Deputy Ombudsman. The Court's ruling in
Acop that the authority of the Ombudsman to prosecute based on R.A. No. 6770 was
authorized by the Constitution was also made the foundation for the decision in Perez v.
Sandiganbayan, where it was held that the power to prosecute carries with it the power to
authorize the filing of informations, which power had not been delegated to the OSP. It is,
therefore, beyond cavil that under the Constitution, Congress was not proscribed from
legislating the grant of additional powers to the Ombudsman or placing the OSP under the
Office of the Ombudsman.

ISSUE:

W/n the Court's ruling on the constitutionality of the provisions of R.A. No. 6770
should be revisited and the principle of stare decisis be set aside.

RULING:

The doctrine of stare decisis et non quieta movere (to adhere to precedents and not to
unsettle things which are established) is embodied in Article 8 of the Civil Code of the
Philippines which provides, thus:

ART. 8. Judicial decisions applying or interpreting the laws or


the Constitution shall form a part of the legal system of the
Philippines.
It was further explained in Fermin v. People as follows:

The doctrine of stare decisis enjoins adherence to judicial precedents. It


requires courts in a country to follow the rule established in a decision of the
Supreme Court thereof. That decision becomes a judicial precedent to be followed
in subsequent cases by all courts in the land. The doctrine of stare decisis is based
on the principle that once a question of law has been examined and decided, it
should be deemed settled and closed to further argument.

In Chinese Young Men's Christian Association of the Philippine Islands v. Remington Steel
Corporation, the Court expounded on the importance of the foregoing doctrine, stating that:

The doctrine of stare decisis is one of policy grounded on the


necessity for securing certainty and stability of judicial decisions, thus:

Time and again, the court has held that it is a


very desirable and necessary judicial practice that when a
court has laid down a principle of law as applicable to a certain
state of facts, it will adhere to that principle and apply it to all future
cases in which the facts are substantially the same. Stare decisis
et non quieta movere. Stand by the decisions and disturb not
what is settled. Stare decisis simply means that for the sake of
certainty, a conclusion reached in one case should be applied
to those that follow if the facts are substantially the same,
even though the parties may be different. It proceeds from the
first principle of justice that, absent any powerful countervailing
considerations, like cases ought to be decided alike. Thus,
where the same questions relating to the same event have been
put forward by the parties similarly situated as in a previous case
litigated and decided by a competent court, the rule of stare
decisis is a bar to any attempt to relitigate the same issue.

The doctrine has assumed such value in our judicial system that the Court has ruled
that “[a]bandonment thereof must be based only on strong and compelling reasons,
otherwise, the becoming virtue of predictability which is expected from this Court would be
immeasurably affected and the public's confidence in the stability of the solemn pronouncements
diminished.” Verily, only upon showing that circumstances attendant in a particular case override
the great benefits derived by our judicial system from the doctrine of stare decisis, can the courts
be justified in setting aside the same.

In this case, petitioners have not shown any strong, compelling reason to convince
the Court that the doctrine of stare decisis should not be applied to this case. They have
not successfully demonstrated how or why it would be grave abuse of discretion for the
Ombudsman, who has been validly conferred by law with the power of control and
supervision over the OSP, to disapprove or overturn any resolution issued by the latter.

The petition is DISMISSED for lack of merit.


TOBIAS SELGA and CEFERINA GARANCHO SELGA, Petitioners,vs. SONY ENTIERRO
BRAR, represented by her Attorney-in-Fact MARINA T. ENTIERRO, Respondent.

G.R. No. 175151 September 21, 2011

FACTS:

Francisco Entierro died intestate and left behind a parcel of land, identified as Lot 1138-A, located
in Himamaylan City, Negros Occidental. Francisco’s spouse, Basilia Tabile (Basilia), and
legitimate children, Esteban, Herminia, Elma, Percival, and Gilda, all surnamed Entierro
(collectively referred to as Basilia, et al.), executed a Deed of Sale with Declaration of Heirship. In
said Deed, Basilia, et al., declared themselves to be Francisco’s only heirs who inherited the
subject property; and at the same time, sold the subject property to petitioners, spouses Tobias
Selga and Ceferina Garancho Selga, for P120,000.00. By reason of said sale, TCT No. T-10273
in Francisco’s name was cancelled and replaced by TCT No. T-134408 in petitioners’ names.

Seven years later, respondent Sony Entierro Brar, represented by her sister-in-law and attorney-
in-fact, Marina T. Entierro, filed before Branch 55 of the RTC of Himamaylan City, Negros
Occidental (RTC-Branch 55) a Complaint for Annulment of Sale with Damages against
petitioners, which was docketed as Civil Case No. 276. Respondent claimed that she was one of
the legitimate children of Francisco and Basilia, and that she had been preterited and illegally
deprived of her rightful share and interests in the subject property as one of Francisco’s legal
heirs. Among respondent’s allegations in her Complaint was:

10. That as one of the co-heirs of the undivided portion of the questioned lot 1138-A, [herein
respondent] is legally entitled to redeem the said property from the [herein petitioners] for the
price the said [petitioners] have paid her co-heirs as appearing in the Deed of Sale with
Declaration of Heirship, Annex "B."4

RTC-Branch 55 rendered the judgment declaring the annulment of the Deed of Sale with
Declaration of heirship adjudicating ownership of Lot No. 1138-A in the name of [herein
respondent] Sony Entierro Brar being one of the legitimate heirs of spouses Francisco Entierro
and Basilia Tabile one eleventh (1/11) share and ten eleventh (10/11) share in the name of [herein
petitioner] Tobias Selga married to Ceferina Garancho.

Unsatisfied, respondent filed an appeal of the aforequoted judgment of RTC-Branch 55 before the
Court of Appeals, where it was docketed as CA-G.R. CV No. 9520A UDK. However, respondent
subsequently moved to withdraw her appeal. The Decision dated May 8, 1996 of RTC-Branch 55
eventually attained finality.

In a Letter dated August 11, 1997, respondent informed petitioners that she was exercising her
right to redeem petitioners’ ten-eleventh (10/11) share in the subject property. In their Reply-Letter
dated August 20, 1997, petitioners’ counsel rejected respondent’s demand. This prompted
respondent to institute on January 21, 1998 a Complaint for Legal Redemption with Damages,
which was docketed as Civil Case No. 573 before RTC-Branch 56.

In their Answer with Counterclaim in Civil Case No. 576, petitioners invoked the defenses of res
judicata and/or forum shopping, arguing that the cause of action pleaded by respondent was
among those that had already been litigated in Civil Case No. 276 before RTC-Branch 55. In its
Decision dated July 27, 2001, RTC-Branch 56 agreed with petitioners and dismissed Civil Case
No. 573.

Respondent’s appeal of the aforementioned judgment of RTC-Branch 56 was docketed as CA-


G.R. CV No. 72987 before the Court of Appeals.On May 31, 2006, the Court of Appeals
promulgated its Decision in CA-G.R. CV No. 72987, which reversed and set aside the assailed
July 27, 2001 Decision of RTC-Branch 56 in Civil Case No. 573. The Court of Appeals held that
respondent had validly exercised her right to redemption of the subject property.The appellate
court further ruled that Civil Case No. 573 before RTC-Branch 56 was not barred by the final
judgment in Civil Case No. 276 of RTC-Branch 55.

Petitioners filed a Petition for Review before the Supreme Court, insisting that respondent’s right
to redemption of the subject property from petitioners was among the causes of action already
litigated in Civil Case No. 276 before RTC-Branch 55; and the very same cause of action
between the same parties involving the same subject matter was merely duplicated in Civil Case
No. 573 before RTC-Branch 56. Thus, the prior final judgment rendered in Civil Case No. 276
already barred Civil Case No. 573.

Respondent counters that Civil Case No. 573 before RTC-Branch 56 involving her legal right to
redeem the subject property from petitioners cannot be deemed barred by the final judgment in
Civil Case No. 276 rendered by RTC-Branch 55 because said issue was not explicitly ruled upon
in the latter case.

ISSUE:

Whether or not the present action is barred by res judicata in view of the finality of the decision in
Civil Case No. 276.

HELD:

Res judicata has two concepts. The first is bar by prior judgment under Rule 39, Section 47(b),
and the second is conclusiveness of judgment under Rule 39, Section 47(c). Res judicata under
the first concept or as a bar against the prosecution of a second action exists when there is
identity of parties, subject matter and cause of action in the first and second actions. The
judgment in the first action is final as to the claim or demand in controversy, including the parties
and those in privity with them, not only as to every matter which was offered and received to
sustain or defeat the claim or demand, but as to any other admissible matter which might have
been offered for that purpose and of all matters that could have been adjudged in that case. In
contrast, res judicata under the second concept or estoppel by judgment exists when there is
identity of parties and subject matter but the causes of action are completely distinct. The first
judgment is conclusive only as to those matters actually and directly controverted and determined
and not as to matters merely involved herein.

The case at bar satisfies the four essential requisites of res judicata under the first concept, bar
by prior judgment, viz:

(a) finality of the former judgment;

(b) the court which rendered it had jurisdiction over the subject matter and the parties;

(c) it must be a judgment on the merits; and

(d) there must be, between the first and second actions, identity of parties, subject matter and
causes of action.18

It is not disputed that the Decision dated May 8, 1996 of RTC-Branch 55 in Civil Case No. 276
had become final and executory. Petitioners no longer appealed the said decision, while
respondent withdrew her appeal of the same before the Court of Appeals.
There is also no question that RTC-Branch 55 had jurisdiction over the subject matter and parties
in Civil Case No. 276, and that its Decision dated May 8, 1996 was a judgment on the merits, i.e.,
one rendered after a consideration of the evidence or stipulations submitted by the parties at the
trial of the case.

Controversy herein arises from the fourth requirement: the identity of parties, subject matter and,
particularly, the causes of action between Civil Case No. 276 and Civil Case No. 573.

There is identity of parties. Civil Case No. 276 and Civil Case No. 573 were both instituted by
respondent against petitioners.

There is also identity of subject matter. Civil Case No. 276 and Civil Case No. 573 both involved
respondent’s rights and interests over the subject property as Francisco’s legitimate child and
compulsory heir.

Finally, there is identity of causes of action.

Section 2, Rule 2 of the Rules of Court defines a cause of action as "the act or omission by which
a party violates a right of another." The cause of action in Civil Case No. 273 and Civil Case No.
576 is the sale of the entire subject property by Basilia, et al., to petitioners without respondent’s
knowledge and consent, hence, depriving respondent of her rights and interests over her pro-
indiviso share in the subject property as a co-heir and co-owner. The annulment of the sale of
respondent’s share in the subject property, the legal redemption by respondent of her co-heirs’
share sold to petitioners, and the claim for damages should not be mistaken to be the causes of
action, but they were the remedies and reliefs prayed for by the respondent to redress the wrong
allegedly committed against her.

The allegations in respondent’s Complaint in Civil Case No. 573 initially give the impression that
the cause of action therein was petitioners’ refusal to heed respondent’s demand to redeem
petitioners’ ten-eleventh (10/11) share in the subject property. But a closer study of said
Complaint, as well as the trial proceedings before RTC-Branch 56, reveal that respondent’s right
to redeem petitioners’ ten-eleventh (10/11) share in the subject property also arose from the sale
of the said subject property to petitioners by respondent’s co-heirs and co-owners, alleged to be
without respondent’s knowledge or consent – the very same cause of action at the crux of Civil
Case No. 276.

Therefore, Civil Case No. 573 before RTC-Branch 56 should be dismissed, being barred by res
judicata, given the final and executory Decision dated May 8, 1996 of RTC-Branch 55 in Civil
Case No. 276. We stress that res judicata, in the concept of bar by prior judgment, renders the
judgment or final order conclusive between the parties and their privies, not just with respect to a
matter directly adjudged, but also any other matter that could have been raised in relation thereto.
Megan Sugar Corporation v. Regional Trial Court of Iloilo, et al

G.R. No. 170352, 1 June 2011, (Peralta, J.)

FACTS:

New Frontier Sugar Corporation (NFSC) obtained a loan from Equitable PCI Bank secured by a
real estate mortgage over NFSC’s land and a chattel mortgage over NFSC’s sugar mill. Due to
illiquidity problems, NFSC entered into a MOA with Central Iloilo Milling Corporation (CIMICO)
whereby the latter would take-over the operation and management of NFSC.

NFSC filed a complaint for specific performance against CIMICO for failure to pay its obligations.
CIMICO countered by filing a case for sum of money and breach of contract.

Meanwhile, Equitable PCI Bank instituted extra-judicial foreclosure proceedings due to NFSC’s
failure to pay. During the public auction, Equitable was the sole bidder. It was able to consolidate
the titles in its name. Equitable then hired Industrial Security Agency (PISA) to secure the land
and mill. Afterwards, Equitable sold the same to Passi Iloilo Sugar Central.

Despite the consolidation of title and the subsequent sale of the property to Passi, CIMICO was
able to retain the property due to a restraining order it filed. Afterwards, CIMICO and Megan
Sugar Corporation entered into a MOA whereby Megan assumed CIMICO’s rights and interests
over the property.

Passi Sugar then filed a motion for intervention claiming to be the vendee of Equitable. During the
hearing for the said motion, Atty. Reuben Mikhail Sabig appeared before the RTC as counsel for
Megan. He manifested that his statements would bind Megan. Several motions were filed by
Equitable to hold in escrow the sugar quedans or the proceeds therefrom. The RTC granted such
motion. Megan Corporation or its director officer was ordered to deposit in escrow the sugar
quedans.

Atty. Sabig appearing for Megan, filed a motion for reconsideration which was denied. Then,
Megan on its own, appealed before the CA alleging that the RTC which rendered the decision
had no jurisdiction over Megan. CA denied such motion ruling that Megan was already estopped
from assailing the RTC’s jurisdiction since Atty. Sabig who represented that he was the counsel
for Megan, had actively participated before the RTC.

ISSUE:

Whether or not Megan Sugar Corporation is estopped from questioning the jurisdiction of the
RTC

RULING:

Petition DENIED. Megan Sugar Corporation is already estopeed.


MEGAN points out that its board of directors did not issue a resolution authorizing Atty. Sabig to
represent the corporation before the RTC. It contends that Atty. Sabig was an unauthorized agent
and as such his actions should not bind the corporation. In addition, MEGAN argues that the
counsels of the different parties were aware of Atty. Sabig’s lack of authority because he declared
in court that he was still in the process of taking over the case and that his voluntary appearance
was just for the hearing of the motion for intervention of Passi Sugar.

After a judicial examination of the records pertinent to the case at bar, this Court agrees with the
finding of the CA that MEGAN is already estopped from assailing the jurisdiction of the RTC.

The doctrine of estoppel is based upon the grounds of public policy, fair dealing, good faith and
justice, and its purpose is to forbid one to speak against his own act, representations, or
commitments to the injury of one to whom they were directed and who reasonably relied thereon.
The doctrine of estoppel springs from equitable principles and the equities in the case. It is
designed to aid the law in the administration of justice where without its aid injustice might result.
It has been applied by this Court wherever and whenever special circumstances of a case so
demand.

MEGAN can no longer deny the authority of Atty. Sabig as they have already clothed him with
apparent authority to act in their behalf. It must be remembered that when Atty. Sabig entered his
appearance, he was accompanied by Concha, MEGAN’s director and general manager. Concha
himself attended several court hearings, and on December 17, 2002, even sent a letter to the
RTC asking for the status of the case. A corporation may be held in estoppel from denying as
against innocent third persons the authority of its officers or agents who have been
clothed by it with ostensible or apparent authority.

Apparent authority, or what is sometimes referred to as the "holding out" theory, or


doctrine of ostensible agency, imposes liability, not as the result of the reality of a
contractual relationship, but rather because of the actions of a principal or an employer in
somehow misleading the public into believing that the relationship or the authority exists.

Like the CA, this Court notes that MEGAN never repudiated the authority of Atty. Sabig when all
the motions, pleadings and court orders were sent not to the office of Atty. Sabig but to the office
of MEGAN, who in turn, would forward all of the same to Atty. Sabig. One of the instances of
estoppel is when the principal has clothed the agent with indicia of authority as to lead a
reasonably prudent person to believe that the agent actually has such authority. With the
case of MEGAN, it had all the opportunity to repudiate the authority of Atty. Sabig since all
motions, pleadings and court orders were sent to MEGAN’s office. However, MEGAN never
questioned the acts of Atty. Sabig and even took time and effort to forward all the court
documents to him.

In addition, it bears to point out that MEGAN was negligent when it did not assail the
authority of Atty. Sabig within a reasonable time from the moment when the first adverse
order was issued. With such an order that directly affects the disposition of MEGAN’s assets
and one that involves a substantial amount, it is inconceivable for Atty. Sabig or for Concha not to
inform MEGAN’s board of such an order or for one of the directors not to hear of such order thru
other sources. As manifested by NFSC, MEGAN is a family corporation and Concha is the son-in-
law of Eduardo Jose Q. Miranda (Eduardo), the President of MEGAN. Elizabeth Miranda, one of
the directors, is the daughter of Eduardo. MEGAN’s treasurer, Ramon Ortiz is a cousin of the
Mirandas. Thus, given the nature and structure of MEGAN’s board, it is unimaginable that not a
single director was aware of the January 16, 2003 RTC Order. However, far from repudiating the
authority of Atty. Sabig, Atty. Sabig even filed a Manifestation36 that MEGAN will deposit the
quedans, as directed by the RTC, every "Friday of the week."
The rule is that the active participation of the party against whom the action was brought, coupled
with his failure to object to the jurisdiction of the court or administrative body where the action is
pending, is tantamount to an invocation of that jurisdiction and a willingness to abide by the
resolution of the case and will bar said party from later on impugning the court or body’s
jurisdiction.