G.R. No.

73765 August 26, 1991 Plaintiff the sum of based on the grounds that petitioner had no legal
HANG LUNG BANK, LTD., petitioner, HK$1,117,968.36 together with capacity to sue and that venue was improperly laid.
vs. interest on the respective principal Acting on said motion to dismiss, on December 20,
HON. FELINTRIYE G. SAULOG, Presiding sums of HK$196,591.38, 1985, the lower court 4 issued the following order:
Judge, Regional Trial Court, National Capital HK$200,216.29, HK$526,557.63, On defendant Chin San Cordova's
Judicial Region, Branch CXLII, Makati, Metro HK$49,350.00 and HK$3,965.50 at motion to dismiss, dated July 10,
Manila, and CORDOVA CHIN SAN, respondents. the rates of 1.7% per month (or 1985; plaintiff's opposition, dated
Belo, Abiera& Associates for petitioner. HK$111.40 per day), 18.5% per July 12, 1985; defendant's reply,
Castelo Law Office for private respondent. annum (or HK$101.48 per day), dated July 22, 1985; plaintiff's
1.85% per month (or HK$324.71 supplemental opposition, dated
FERNAN, C.J.:p per day), 1.55% per month (or September 13, 1985, and
Challenged in this petition for certiorari which is HK$25.50 per day) and 1.7% per defendant's rejoinder filed on
anchored on grave abuse of discretion, are two orders month (or HK$2.25 per day) September 23, 1985, said motion to
of the Regional Trial Court, Branch CXLII of respectively from 4th May 1984 up dismiss is granted.
Makati, Metro Manila dismissing the complaint for to the date of payment; and Section 14, General Banking Act
collection of a sum of money and denying the motion (2) the 2nd Defendant (Cordova provides:
for reconsideration of the dismissal order on the Chin San) do pay the Plaintiff the "No foreign bank
ground that petitioner, a Hongkong-based bank, is sum of HK$279,325.00 together or banking
barred by the General Banking Act from maintaining with interest on the principal sum corporation
a suit in this jurisdiction. of HK$250,000.00 at the rate of formed,
The records show that on July 18, 1979, petitioner 1.7% per month (or HK$141.67 per organized or
Hang Lung Bank, Ltd., which was not doing business day) from 4th May 1984 up to the existing under
in the Philippines, entered into two (2) continuing date of payment. any laws other
guarantee agreements with Cordova Chin San in AND IT IS ADJUDGED that the than those of the
Hongkong whereby the latter agreed to pay on 1st and 2nd Defendants do pay the Republic of the
demand all sums of money which may be due the Plaintiff the sum of HK$970.00 Philippines, shall
bank from Worlder Enterprises to the extent of the fixed costs. be permitted to
total amount of two hundred fifty thousand N.J. BARNETT transact business
Hongkong dollars (HK $250,000). 1 Registrar in the
Worlder Enterprises having defaulted in its payment, Thereafter, petitioner through counsel sent a demand Philippines, or
petitioner filed in the Supreme Court of Hongkong a letter to Chin San at his Philippine address but again, maintain by itself
collection suit against Worlder Enterprises and Chin no response was made thereto. Hence, on October 18, any suit for the
San. Summonses were allegedly served upon 1984, petitioner instituted in the court below an recovery of any
Worlder Enterprises and Chin San at their addresses action seeking "the enforcement of its just and valid debt, claims or
in Hongkong but they failed to respond thereto. claims against private respondent, who is a local demands
Consequently, the Supreme Court of Hongkong resident, for a sum of money based on a transaction whatsoever until
issued the following: which was perfected, executed and consummated after it shall have
JUDGMENT abroad." 2 obtained, upon
THE 14th DAY OF JUNE, 1984 In his answer to the complaint, Chin San raised as order of the
No notice of intention to defend affirmative defenses: lack of cause of action, Monetary Board,
having been given by the 1st and incapacity to sue and improper venue. 3 a license for that
2nd Defendants herein, IT IS THIS Pre-trial of the case was set for June 17, 1985 but it purpose."
DAY ADJUDGED that: — was postponed to July 12, 1985. However, a day Plaintiff Hang Lung Bank, Ltd.
(1) the 1st Defendant (KoChing before the latter pre-trial date, Chin San filed a with business and postal address at
Chong Trading otherwise known as motion to dismiss the case and to set the same for the 3rd Floor, United Centre, 95
the Worlder Enterprises) do pay the hearing the next day. The motion to dismiss was Queensway, Hongkong, does not
 do business in the Philippines. The
continuing guarantee, Annexes "A"
and "B" appeared to have been
transacted in Hongkong. Plaintiff's
Annex "C" shows that it had
already obtained judgment from the
Supreme Court of Hongkong
against defendant involving the
same claim on June 14, 1984.
The cases of Mentholatum
Company, Inc. versus Mangaliman,
72 Phil. 524 and Eastern Seaboard
Navigation, Ltd. versus Juan
Ysmael& Company, Inc., 102 Phil.
1-8, relied upon by plaintiff, deal
with isolated transaction in the
Philippines of foreign corporation.
Such transaction though isolated is
the one that conferred jurisdiction
to Philippine courts, but in the
instant case, the transaction
occurred in Hongkong.
Case dismissed. The instant
complaint not the proper action.
SO ORDERED. 5
Petitioner filed a motion for the reconsideration of
said order but it was denied for lack of
merit. 6 Hence, the instant petition
for certiorari seeking the reversal of said orders "so
as to allow petitioner to enforce through the court
below its claims against private respondent as
recognized by the Supreme Court of Hongkong." 7
Petitioner asserts that the lower court gravely abused
its discretion in: (a) holding that the complaint was
not the proper action for purposes of collecting the
amount guaranteed by Chin San "as recognized and
adjudged by the Supreme Court of Hongkong;" (b)
interpreting Section 14 of the General Banking Act as
precluding petitioner from maintaining a suit before
Philippine courts because it is a foreign corporation
not licensed to do business in the Philippines despite
the fact that it does not do business here; and (c)
impliedly sustaining private respondent's allegation
of improper venue.
We need not detain ourselves on the issue of
improper venue. Suffice it to state that private
respondent waived his right to invoke it when he
forthwith filed his answer to the complaint thereby
necessarily implying submission to the jurisdiction of
the court. 8
The resolution of this petition hinges on a
determination of whether petitioner foreign banking
corporation has the capacity to file the action below.
Private respondent correctly contends that since
petitioner is a bank, its capacity to file an action in
this jurisdiction is governed by the General Banking
Act (Republic Act No. 337), particularly Section 14
thereof which provides:
SEC. 14. No foreign bank or
banking corporation formed,
organized or existing under any
laws other than those of the
Republic of the Philippines shall be
permitted to transact business in the
Philippines, or maintain by itself or
assignee any suit for the recovery
of any debt, claims, or demand
whatsoever, until after it shall have
obtained, upon order of the
Monetary Board, a license for that
purpose from the Securities and
Exchange Commissioner. Any
officer, director or agent of any
such corporation who transacts
business in the Philippines without
the said license shall be punished
by imprisonment for not less than
one year nor more than ten years
and by a fine of not less than one
thousand pesos nor more than ten
thousand pesos. (45 O.G. No. 4,
1647, 1649-1650)
In construing this provision, we adhere to the
interpretation given by this Court to the almost
identical Section 69 of the old Corporation Law (Act
No. 1459) which reads:
SEC. 69. No foreign corporation or
corporation formed, organized, or
existing under any laws other than
those of the Philippines shall be
permitted to transact business in the
Philippines or maintain by itself or
assignee any suit for the recovery
of any debt, claim, or demand
whatever, unless it shall have the
license prescribed in the section
immediately preceding. Any
officer, director or agent of the
corporation or any person
transacting business for any foreign
corporation not having the license
prescribed shall be punished by
imprisonment for not less than six
months nor more than two years or
by a fine of not less than two
hundred pesos nor more than one
thousand pesos, or by both such
imprisonment and fine, in the
discretion of the Court.
In a long line of cases, this Court has interpreted this
last quoted provision as not altogether prohibiting a
foreign corporation not licensed to do business in the
Philippines from suing or maintaining an action in
Philippine courts. 9What it seeks to prevent is a
foreign corporation doing business in the Philippines
without a license from gaining access to Philippine
courts. As elucidated in Marshall-Wells Co. vs.
Elser& Co., 46 Phil. 70:
The object of the statute was to
subject the foreign corporation
doing business in the Philippines to
the jurisdiction of its courts. The
object of the statute was not to
prevent it from performing single
acts but to prevent it from acquiring
a domicile for the purpose of
business without taking the steps
necessary to render it amenable to
suit in the local courts. The
implication of the law is that it was
never the purpose of the
Legislature to exclude a foreign
corporation which happens to
obtain an isolated order for
business from the Philippines from
securing redress from Philippine
courts, and thus, in effect, to permit
persons to avoid their contract
 made with such foreign
corporation. The effect of the
statute preventing foreign
corporations from doing business
and from bringing actions in the
local courts, except on compliance
with elaborate requirements, must
not be unduly extended or
improperly applied. It should not be
construed to extend beyond the
plain meaning of its terms,
considered in connection with its
object, and in connection with the
spirit of the entire law.
The fairly recent case of Universal Shipping Lines vs.
Intermediate Appellate Court, 10 although dealing
with the amended version of Section 69 of the old
Corporation Law, Section 133 of the Corporation
Code (Batas PambansaBlg. 68), but which is
nonetheless apropos, states the rule succinctly: "it is
not the lack of the prescribed license (to do business
in the Philippines) but doing business without
license, which bars a foreign corporation from access
to our courts."
Thus, we have ruled that a foreign corporation not
licensed to do business in the Philippines may file a
suit in this country due to the collision of two vessels
at the harbor of Manila 11 and for the loss of goods
bound for Hongkong but erroneously discharged in
Manila. 12
Indeed, the phraseologies of Section 14 of the
General Banking Act and its almost identical
counterpart Section 69 of the old Corporation Law
are misleading in that they seem to require a foreign
corporation, including a foreign bank or banking
corporation, not licensed to do business and not doing
business in the Philippines to secure a license from
the Securities and Exchange Commission before it
can bring or maintain an action in Philippine courts.
To avert such misimpression, Section 133 of the
Corporation Code is now more plainly worded thus:
No foreign corporation transacting
business in the Philippines without
a license, or its successors or
assigns, shall be permitted to
maintain or intervene in any action,
suit or proceeding in any court or
administrative agency of the
Philippines.
Under this provision, we have ruled that a foreign
corporation may sue in this jurisdiction for
infringement of trademark and unfair competition
although it is not doing business in the
Philippines 13 because the Philippines was a party to
the Convention of the Union of Paris for the
Protection of IndustrialProperty. 14
We even went further to say that a foreign
corporation not licensed to do business in the
Philippines may not be denied the right to file an
action in our courts for an isolated transaction in this
country. 15
Since petitioner foreign banking corporation was not
doing business in the Philippines, it may not be
denied the privilege of pursuing its claims against
private respondent for a contract which was entered
into and consummated outside the Philippines.
Otherwise we will be hampering the growth and
development of business relations between Filipino
citizens and foreign nationals. Worse, we will be
allowing the law to serve as a protective shield for
unscrupulous Filipino citizens who have business
relationships abroad.
In its pleadings before the court, petitioner appears to
be in a quandary as to whether the suit below is one
for enforcement or recognition of the Hongkong
judgment. Its complaint states:
COMES NOW Plaintiff, by
undersigned counsel, and to this
Honorable Court, most respectfully
alleges that:
1. Plaintiff is a corporation duly
organized and existing under and
by virtue of the laws of Hongkong
with business and postal address at
the 3rd Floor, United Centre, 95
Queensway, Hongkong, not doing
business in the Philippines, but is
suing for this isolated transaction,
but for purposes of this complaint
may be served with summons and
legal processes of this Honorable
Court, at the 6th Floor, Cibeles
Building, 6780 Ayala Avenue,
Makati, Metro Manila, while
defendant Cordova Chin San, may
be served with summons and other
legal processes of this Honorable
Court at the Municipality of
Moncada, Province of Tarlac,
Philippines;
2. On July 18, 1979 and July 25,
1980, the defendant executed
Continuing Guarantees, in
consideration of plaintiff's from
time to time making advances, or
coming to liability or discounting
bills or otherwise giving credit or
granting banking facilities from
time to time to, or on account of the
Wolder Enterprises (sic),
photocopies of the Contract of
Continuing Guarantees are hereto
attached as Annexes "A" and "B",
respectively, and made parts
hereof;
3. In June 1984, a complaint was
filed by plaintiff against the Wolder
Enterprises (sic) and defendant
Cordova Chin San, in The Supreme
Court of Hongkong, under Case
No. 3176, and pursuant to which
complaint, a judgment dated 14th
day of July, 1984 was rendered by
The Supreme Court of Hongkong
ordering to (sic) defendant Cordova
Chin San to pay the plaintiff the
sum of HK$279,325.00 together
with interest on the principal sum
of HK$250,000.00 at the rate of
HK$1.7% per month or
(HK$141.67) per day from 4th
May, 1984 up to the date the said
amount is paid in full, and to pay
the sum of HK$970.00 as fixed
cost, a photocopy of the Judgment
rendered by The Supreme Court of
Hongkong is hereto attached as
Annex "C" and made an integral
part hereof.
4. Plaintiff has made demands upon
the defendant in this case to pay the
aforesaid amount the last of which
is by letter dated July 16, 1984 sent
by undersigned counsel, a
photocopy of the letter of demand
is hereto attached as Annex "D"
and the Registry Return Card
hereto attached as Annex "E",
respectively, and made parts
hereof. However, this
notwithstanding, defendant failed
and refused and still continue to fail
and refuse to make any payment to
plaintiff on the aforesaid amount of
HK$279,325.00 plus interest on the
principal sum of HK$250,000.00 at
the rate of (HK$141.67) per day
from May 4, 1984 up to the date of
payment;
5. In order to protect and safeguard
the rights and interests of herein
plaintiff, it has engaged the services
of undersigned counsel, to file the
suit at bar, and for whose services it
has agreed to pay an amount
equivalent to 25% of the total
amount due and owing, as of and
by way of attorney's fees plus costs
of suit.
WHEREFORE, premises
considered, it is most respectfully
prayed of this Honorable Court that
judgment be rendered ordering the
defendant:
a) To pay plaintiff the sum of
HK$279,325.00 together with
interest on the principal sum of
HK$260,000.00 at the rate of
HK$1.7% (sic) per month (or
HK$141.67 per day) from May 4,
1984 until the aforesaid amount is
paid in full;
b) To pay an amount equivalent to
25% of the total amount due and
demandable as of and by way of
attorney's fees; and
c) To pay costs of suit, and
Plaintiff prays for such other and
further reliefs, to which it may by
law and equity, be entitled. 16
The complaint therefore appears to be one of the
enforcement of the Hongkong judgment because it
prays for the grant of the affirmative relief given by
said foreign judgment. 17 Although petitioner asserts
that it is merely seeking the recognition of its claims
based on the contract sued upon and not the
enforcement of the Hongkong judgment 18 it should
be noted that in the prayer of the complaint,
petitioner simply copied the Hongkong judgment
with respect to private respondent's liability.
However, a foreign judgment may not be enforced if
it is not recognized in the jurisdiction where
affirmative relief is being sought. Hence, in the
interest of justice, the complaint should be considered
as a petition for the recognition of the Hongkong
judgment under Section 50 (b), Rule 39 of the Rules
of Court in order that the defendant, private
respondent herein, may present evidence of lack of
jurisdiction, notice, collusion, fraud or clear mistake
of fact and law, if applicable.
WHEREFORE, the questioned orders of the lower
court are hereby set aside. Civil Case No. 8762 is
reinstated and the lower court is directed to proceed
with dispatch in the disposition of said case. This
decision is immediately executory. No costs.
SO ORDERED.
G.R. No. L-27906 January 8, 1987
CONVERSE RUBBER
CORPORATION, petitioner,
vs.
UNIVERSAL RUBBER PRODUCTS, INC. and
TIBURCIO S. EVALLE, DIRECTOR OF
PATENTS, respondents.
Parades, Poblador, Nazareno, Azada&Tomacruz for
petitioner.
RESOLUTION
FERNAN, J.:
The undisputed facts of the case are as follows:
Respondent Universal Rubber Products, Inc. filed an
application with the Philippine Patent office for
registration of the trademark "UNIVERSAL
CONVERSE AND DEVICE" used on rubber shoes
and rubber slippers.
Petitioner Converse Rubber Corporation filed its
opposition to the application for registration on
grounds that:
a] The trademark sought to be
registered is confusingly similar to
the word "CONVERSE" which is
part of petitioner's corporate name
"CONVERSE RUBBER
CORPORATION" as to likely
deceive purchasers of products on
which it is to be used to an extent
that said products may be mistaken
by the unwary public to be
manufactured by the petitioner;
and,
b] The registration of respondent's
trademark will cause great and
irreparable injury to the business
reputation and goodwill of
petitioner in the Philippines and
would cause damage to said
petitioner within the, meaning of
Section 8, R.A. No. 166, as
amended.
Thereafter, respondent filed its answer and at the pre-
trial, the parties submitted the following partial
stipulation of facts:
1] The petitioner's corporate name
is "CONVERSE RUBBER
CORPORATION" and has been in
existence since July 31, 1946; it is
duly organized under the laws of
Massachusetts, USA and doing
business at 392 Pearl St., Malden,
County of Middle sex,
Massachusetts;
2] Petitioner is not licensed to do
business in the Philippines and it is
not doing business on its own in the
Philippines; and,
3] Petitioner manufacturers rubber
shoes and uses thereon the
trademarks "CHUCK TAYLOR
"and "ALL STAR AND
DEVICE". 1
At the trial, petitioner's lone witness, Mrs. Carmen B.
Pacquing, a duly licensed private merchant with
stores at the Sta. Mesa Market and in Davao City,
testified that she had been selling CONVERSE
rubber shoes in the local market since 1956 and that
sales of petitioner's rubber shoes in her stores
averaged twelve to twenty pairs a month purchased
mostly by basketball players of local private
educational institutions like Ateneo, La Salle and San
Beda.
Mrs. Pacquing, further stated that she knew
petitioner's rubber shoes came from the United States
"because it says there in the trademark Converse
Chuck Taylor with star red or blue and is a round
figure and made in U.S.A. " 2 In the invoices issued
by her store, the rubber shoes were described as
"Converse Chuck Taylor", 3 "Converse All
Star," 4 "All Star Converse Chuck Taylor," 5 or
"Converse Shoes Chuck Taylor." 6 She also affirmed
that she had no business connection with the
petitioner.
Respondent, on the other hand, presented as its lone
witness the secretary of said corporation who testified
that respondent has been selling on wholesale basis
"Universal Converse" sandals since 1962 and
"Universal Converse" rubber shoes since 1963.
Invoices were submitted as evidence of such sales.
The witness also testified that she had no Idea why
respondent chose "Universal Converse" as a
trademark and that she was unaware of the name
"Converse" prior to her corporation's sale of
"Universal Converse" rubber shoes and rubber
sandals.
Eventually, the Director of Patents dismissed the
opposition of the petitioner and gave due course to
respondent's application. His decision reads in part:
... the only question for
determination is whether or not the
applicant's partial appropriation of
the Opposer's [petitioner'] corporate
name is of such character that in
this particular case, it is calculated
to deceive or confuse the public to
the injury of the corporation to
which the name belongs ...
I cannot find anything that will
prevent registration of the word
'UNIVERSAL CONVERSE' in
favor of the respondent. In arriving
at this conclusion, I am guided by
the fact that the opposer failed to
present proof that the single word
"CONVERSE' in its corporate
name has become so Identified
with the corporation that whenever
used, it designates to the mind of
the public that particular
corporation.
The proofs herein are sales made
by a single witness who had never
dealt with the petitioner . . . the
entry of Opposer's [petitioner's]
goods in the Philippines were not
only effected in a very insignificant
quantity but without the opposer
[petitioner] having a direct or
indirect hand in the transaction so
as to be made the basis for
trademark pre- exemption.
Opposer's proof of its corporate
personality cannot establish the use
of the word "CONVERSE" in any
sense, as it is already stipulated that
it is not licensed to do business in
 the Philippines, and is not doing
business of its own in the
Philippines. If so, it will be futile
for it to establish that
"CONVERSE" as part of its
corporate name Identifies its rubber
shoes. Besides, it was also
stipulated that opposer [petitioner],
in manufacturing rubber shoes uses
thereon the trademark "CHUCK
TAYLOR" and "ALL STAR and
DEVICE" and none other.
Furthermore, inasmuch as the
Opposer never presented any label
herein, or specimen of its shoes,
whereon the label may be seen,
notwithstanding its witness'
testimony touching upon her
Identification of the rubber shoes
sold in her stores, no determination
can be made as to whether the word
'CONVERSE' appears thereon.
. . .the record is wanting in proof to
establish likelihood of confusion so
as to cause probable damage to the
Opposer. 7
Its motion for reconsideration having been denied by
the respondent Director of Patents, petitioner
instituted the instant petition for review.
As correctly phrased by public respondent Director of
Patents, the basic issue presented for our
consideration is whether or not the respondent's
partial appropriation of petitioner's corporate name is
of such character that it is calculated to deceive or
confuse the public to the injury of the petitioner to
which the name belongs.
A trade name is any individual
name or surname, firm name,
device or word used by
manufacturers, industrialists,
merchants and others to Identify
their businesses, vocations or
occupations. 8 As the trade name
refers to the business and its
goodwill ... the trademark refers to
the goods." 9 The ownership of a
trademark or tradename is a
property right which the owner is
entitled to protect "since there is
damage to him from confusion or
reputation or goodwill in the mind
of the public as well as from
confusion of goods. The modern
trend is to give emphasis to the
unfairness of the acts and to
classify and treat the issue as
fraud. 10
From a cursory appreciation of the petitioner's
corporate name "CONVERSE RUBBER
CORPORATION,' it is evident that the word
"CONVERSE" is the dominant word which Identifies
petitioner from other corporations engaged in similar
business. Respondent, in the stipulation of facts,
admitted petitioner's existence since 1946 as a duly
organized foreign corporation engaged in the
manufacture of rubber shoes. This admission
necessarily betrays its knowledge of the reputation
and business of petitioner even before it applied for
registration of the trademark in question. Knowing,
therefore, that the word "CONVERSE" belongs to
and is being used by petitioner, and is in fact the
dominant word in petitioner's corporate name,
respondent has no right to appropriate the same for
use on its products which are similar to those being
produced by petitioner.
A corporation is entitled to the
cancellation of a mark that is
confusingly similar to its corporate
name."11 "Appropriation by
another of the dominant part of a
corporate name is an
infringement."12
Respondent's witness had no Idea why respondent
chose "UNIVERSAL CONVERSE" as trademark
and the record discloses no reasonable explanation
for respondent's use of the word "CONVERSE" in its
trademark. Such unexplained use by respondent of
the dominant word of petitioner's corporate name
lends itself open to the suspicion of fraudulent motive
to trade upon petitioner's reputation, thus:
A boundless choice of words,
phrases and symbols is available to
one who wishes a trademark
sufficient unto itself to distinguish
his product from those of others.
When, however, there is no
reasonable explanation for the
defendant's choice of such a mark
though the field for his selection
was so broad, the inference is
inevitable that it was chosen
deliberately to deceive. 13
The testimony of petitioner's witness, who is a
legitimate trader as well as the invoices evidencing
sales of petitioner's products in the Philippines, give
credence to petitioner's claim that it has earned a
business reputation and goodwill in this country. The
sales invoices submitted by petitioner's lone witness
show that it is the word "CONVERSE" that mainly
Identifies petitioner's products, i.e. "CONVERSE
CHUCK TAYLOR, 14 "CONVERSE ALL
STAR," 15ALL STAR CONVERSE CHUCK
TAYLOR," 16 or "CONVERSE SHOES CHUCK
and TAYLOR." 17 Thus, contrary to the
determination of the respondent Director of Patents,
the word "CONVERSE" has grown to be Identified
with petitioner's products, and in this sense, has
acquired a second meaning within the context of
trademark and tradename laws.
Furthermore, said sales invoices provide the best
proof that there were actual sales of petitioner's
products in the country and that there was actual use
for a protracted period of petitioner's trademark or
part thereof through these sales. "The most
convincing proof of use of a mark in commerce is
testimony of such witnesses as customers, or the
orders of buyers during a certain
period. 18 Petitioner's witness, having affirmed her
lack of business connections with petitioner, has
testified as such customer, supporting strongly
petitioner's move for trademark pre-emption.
The sales of 12 to 20 pairs a month of petitioner's
rubber shoes cannot be considered insignificant,
considering that they appear to be of high expensive
quality, which not too many basketball players can
afford to buy. Any sale made by a legitimate trader
from his store is a commercial act establishing
trademark rights since such sales are made in due
course of business to the general public, not only to
limited individuals. It is a matter of public knowledge
that all brands of goods filter into the market,
indiscriminately sold by jobbers dealers and
merchants not necessarily with the knowledge or
consent of the manufacturer. Such actual sale of
goods in the local market establishes trademark use
which serves as the basis for any action aimed at
trademark pre- exemption. It is a corollary logical
deduction that while Converse Rubber Corporation is
not licensed to do business in the country and is not
actually doing business here, it does not mean that its
goods are not being sold here or that it has not earned
a reputation or goodwill as regards its products. The
Director of Patents was, therefore, remiss in ruling
that the proofs of sales presented "was made by a
single witness who had never dealt with nor had
never known opposer [petitioner] x xx without
Opposer having a direct or indirect hand in the
transaction to be the basis of trademark pre-
exemption."
Another factor why respondent's applications should
be denied is the confusing similarity between its
trademark "UNIVERSAL CONVERSE AND
DEVICE" and petitioner's corporate name and/or its
trademarks "CHUCK TAYLOR" and "ALL STAR
DEVICE" which could confuse the purchasing public
to the prejudice of petitioner,
The trademark of respondent "UNIVERSAL
CONVERSE and DEVICE" is imprinted in a circular
manner on the side of its rubber shoes. In the same
manner, the trademark of petitioner which reads
"CONVERSE CHUCK TAYLOR" is imprinted on a
circular base attached to the side of its rubber shoes.
The deteminative factor in ascertaining whether or
not marks are confusingly similar to each other "is
not whether the challenged mark would actually
cause confusion or deception of the purchasers but
whether the use of such mark would likely cause
confusion or mistake on the part of the buying public.
It would be sufficient, for purposes of the law, that
the similarity between the two labels is such that
there is a possibility or likelihood of the purchaser of
the older brand mistaking the new brand for
it." 19 Even if not an the details just mentioned were
identical, with the general appearance alone of the
two products, any ordinary, or even perhaps even maintain an action in the
[sic] a not too perceptive and discriminating customer Philippines to restrain the residents
could be deceived ... " 20 and inhabitants thereof from
When the law speaks co-purchaser," the reference is organizing a corporation therein
to ordinary average purchaser. 21 It is not necessary in bearing the same name as the
either case that the resemblance be sufficient to foreign corporation, when it
deceive experts, dealers, or other persons specially appears that they have personal
familiar with the trademark or goods involve." 22 knowledge of the existence of such
The similarity y in the general appearance of a foreign corporation, and it is
respondent's trademark and that of petitioner would apparent that the purpose of the
evidently create a likelihood of confusion among the proposed domestic corporation is to
purchasing public. But even assuming, arguendo, that deal and trade in the same goods as
the trademark sought to be registered by respondent those of the foreign corporation.
is distinctively dissimilar from those of the petitioner, We further held:
the likelihood of confusion would still subsists, not xxxxxxxxx
on the purchaser's perception of the goods but on the That company is
origins thereof. By appropriating the word not here seeking
"CONVERSE," respondent's products are likely to be to enforce any
mistaken as having been produced by petitioner. "The legal or control
risk of damage is not limited to a possible confusion rights arising
of goods but also includes confusion of reputation if from or growing
the public could reasonably assume that the goods of out of, any
the parties originated from the same source. 23 business which it
It is unfortunate that respondent Director of Patents has transacted in
has concluded that since the petitioner is not licensed the Philippine
to do business in the country and is actually not doing Islands. The sole
business on its own in the Philippines, it has no name purpose of the
to protect iN the forum and thus, it is futile for it to action:
establish that "CONVERSE" as part of its corporate Is to protect its
name identifies its rubber shoes. That a foreign reputation, its
corporation has a right to maintain an action in the corporate name,
forum even if it is not licensed to do business and is its goodwill
not actually doing business on its own therein has whenever that
been enunciated many times by this Court. In La reputation,
Chemise Lacoste, S.A. vs. Fernandez, 129 SCRA corporate name
373, this Court, reiterating Western Equipment and or goodwill have,
Supply Co. vs. Reyes, 51 Phil. 115, stated that: through the
... a foreign corporation which has natural
never done any business in the development of
Philippines and which is unlicensed its trade,
and unregistered to do business established
here, but is widely and favorably themselves.' And
known in the Philippines through it contends that
the use therein of its products its rights to the
bearing its corporate and use of its
tradename, has a legal right to
corporate and territorial registration whether or not they
trade name: boundaries of form parts of marks. [emphasis
Is a property municipalities or supplied]
right, a right in states or nations, WHEREFORE, the decision of the Director of
recess which it but extends to Patents is hereby set aside and a new one entered
may assert and every market denying Respondent Universal Rubber Products,
protect against all where the trader's Inc.'s application for registration of the trademark
the world, in any goods have "UNIVERSAL CONVERSE AND DEVICE" on its
of the courts of become known rubber shoes and slippers.
the world even in and Identified by SO ORDERED.
jurisdictions the use of the
where it does not mark.
transact business- The ruling in the aforecited case is in consonance
just the same as it with the Convention of the Union of Paris for the
may protect its Protection of Industrial Property to which the
tangible property, Philippines became a party on September 27, 1965.
real or personal Article 8 thereof provides that "a trade name
against trespass, [corporate name] shall be protected in all the
or conversion. countries of the Union without the obligation of filing
Citing sec. 10, or registration, whether or not it forms part of the
Nims on Unfair trademark. " [emphasis supplied]
Competition and The object of the Convention is to accord a national
Trademarks and of a member nation extensive protection "against
cases cited; secs. infringement and other types of unfair competition"
21-22, Hopkins [Vanitary Fair Mills, Inc. vs. T. Eaton Co., 234 F. 2d
on Trademarks, 6331.
Trade Names and The mandate of the aforementioned Convention finds
Unfair implementation in Sec. 37 of RA No. 166, otherwise
Competition and known as the Trademark Law:
cases cited That Sec. 37. Rights of Foreign
point is sustained Registrants-Persons who are
by the authorities, nationals of, domiciled or have a
and is well stated bona fide or effective business or
in Hanover Star commercial establishment in any
Milling Co. vs. foreign country, which is a party to
Allen and an international convention or
Wheeler Co. [208 treaty relating to marks or
Fed., 5131, in tradenames on the repression of
which the unfair competition to which the
syllabus says: Philippines may be a party, shall be
Since it is the entitled to the benefits and subject
trade and not the to the provisions of this Act . . . ...
mark that is to be Tradenames of persons described
protected, a in the first paragraph of this
trademark section shall be protected without
acknowledges no the obligation of filing or
G.R. No. 73722 February 26, 1990
THE COMMISSIONER OF
CUSTOMS, petitioner,
vs.
K.M.K. GANI, INDRAPAL & CO., and the
HONORABLE COURT OF TAX
APPEALS, respondents.
Armando S. Padilla for private respondent.
SARMIENTO, J.:
This is a review of the decision of the Court of Tax
Appeals disposing as follows:
WHEREFORE.the subject ten (10)
cartons of articles are hereby
released to the carrying airline for
immediate transshipment to the
country of destination under the
terms of the contract of carriage.
No costs.
SO ORDERED. 1
The pertinent facts may be summarized thus:
On September 11, 1982, two (2,) containers loaded
with 103 cartons of merchandise covered by eleven
(11) airway bills of several supposedly Singapore-
based consignees arrived at the Manila International
Airport on board Philippine Air Lines (PAL) Flight
PR 311 from Hongkong. The cargoes were consigned
to these different entities: K.M.K. Gani (hereafter
referred to as K.M.K.) and Indrapal and Company
(hereafter referred to as INDRAPAL), the private
respondents in the petition before us; and Sin Hong
Lee Trading Co., Ltd., AAR TEE Enterprises, and C.
Ratilal all purportedly based in Singapore.
While the cargoes were at the Manila International
Airport, a "reliable source" tipped off the Bureau of
customs that the said cargoes were going to be
unloaded in Manila. Forthwith, the Bureau's agency
on such matters, the Suspected Cargo and Anti-
Narcotics (SCAN), dispatched an agent to verify the
information. Upon arriving at the airport, the SCAN
agent saw an empty PAL van parked directly
alongside the plane's belly from which cargoes were
being unloaded. When the SCAN agent asked the
van's driver why he was at the site, the driver drove
away in his vehicle. The SCAN agent then
sequestered the unloaded cargoes.
The seized cargoes consisted of 103 cartons
"containing Mogadon and Mandrax tablets, Sony
T.V. sets 1546R/176R kw, Sony Betamax SL5800,
and SL5000, Cassette Stereos with Headphone
(alawalkman), Casio Calculators, Pioneer Car
Stereos, Yamaha Watches, Eyeglass Frames,
Sunglasses, Plastic Utility Bags, Perfumes, etc."
These goods were transferred to the International
Cargo Terminal under Warrant of Seizure and
Detention and thereafter subjected to Seizure and
Forfeiture proceedings for "technical smuggling."
At the hearing, Atty. Armando S. Padilla entered his
appearance for the consignees K.M.K. and
INDRAPAL. The records of the case do not show
any appearance of the consignees in person. Atty.
Padilla moved for the transshipment of the cargoes
consigned to his clients. On the other hand, the
Solicitor General avers that K.M.K. and INDRAPAL
did not present any testimonial or documentary
evidence. The, collector of Customs at the then
Manila International Airport (MIA), now Ninoy
Aquino International Airport (NAIA), ruled for the
forfeiture of all the cargoes in the said containers
(Seizure Identification No. 4993-82, dated July 14,
1983). Consequently, Atty. Padilla, ostensibly on
behalf of his two clients, K.M.K. and INDRAPAL,
appealed the order to the Commissioner. of
Customs. 2
The Commissioner of Customs affirmed the finding
of the Collector of Customs (Customs Case No. 83-
85, January, 1984), of the presence of the intention to
import the said goods in violation of the Dangerous
Drugs Act 3 and Central Bank Circular No. 808 in
relation to the Tariff and Customs Code. 4
The Commissioner added the following findings of
fact: 5
1. There is a direct flight from
Hongkong to Singapore, thus
making the transit through Manila
more expensive, tedious, and
circuitous.
2. The articles were grossly
misdeclared, considering that
Singapore is a free port.
3. The television sets and betamax
units seized were of the American
standard which is popularly used in
Manila, and not of the European
standard which is used in
Singapore.
4. One of the shippers is a Filipino
national with no business
connection with her alleged
consignee in Singapore.
5. The alleged consignee of the
prohibited drugs confiscated has no
authority to import Mogadon or
Mandrax.
Upon these findings, the Commissioner concluded
that there was an "intent to unlade" in Manila, thus,
an attempt to smuggle goods into the country.
Taking exception to these findings, Atty. Armando S.
Padilla, again as counsel of the consignees K.M.K.
and Indrapal, appealed to the respondent Court of
Tax Appeals (CTA). He argued in the CTA that
K.M.K. and INDRAPAL were "entitled to the release
of their cargoes for transshipment to Singapore so
manifested and covered by the Airway bills as in
transit, ... contending that the goods were never
intended importations into the Philippines and the
same suffer none of any affiliating breaches allegedly
found attributable to the other shipments under the
Customs and related laws." 6
The CTA reversed the decision of the Commissioner
of Customs. Hence this petition.
The petitioner raises the following errors:
1. THE COURT
OF TAX
APPEALS
ERRED IN
ENTERTAININ
G THE
PETITION FOR
REVIEW
NOTWITHSTA
NDING HEREIN
PRIVATE
RESPONDENTS
' FAILURE TO
ESTABLISH
THEIR
PERSONALITY
 TO SUE IN A action in the Philippine courts for an isolated process may be
REPRESENTAT transaction. 8 served to the
IVE CAPACITY. Therefore, the issue on whether or not a foreign undersigned
2. THE COURT corporation which does not have a license to engage lawyer;
OF TAX in business in this country can seek redress in 2. That the
APPEALS Philippine courts boils down as to whether it is doing Petitioner's (sic)
ERRED IN business or merely entered into an isolated are sueing (sic)
RULING THAT transaction in the Philippines. upon a singular
THE SUBJECT The fact that a foreign corporation is not doing and isolated
GOODS WERE business in the Philippines must be disclosed if it transaction. 10
IMPORTATION desires to sue in Philippine courts under the "isolated We are cognizant of the fact that under the "isolated
S NOT transaction rule." Without this disclosure, the court transaction rule," only foreign corporations and not
INTENDED may choose to deny it the right to sue. 9 just any business organization or entity can avail
FOR THE In the case at bar, the private respondents K.M.K. and themselves of the privilege of suing before Philippine
PHILIPPINES INDRAPAL aver that they are "suing upon a singular courts even without a license. Counsel Armando S.
BUT FOR and isolated transaction." But they failed to prove Padilla stated before the respondent Court of Tax
SINGAPORE, their legal existence or juridical personality as foreign Appeals that his clients are "suing upon a singular
THUS, NOT corporations. Their unverified petition before the and isolated transaction." But there is no proof to
VIOLATING respondent Court of Tax Appeals merely stated: show that K.M.K. and INDRAPAL are indeed what
THE LAW ON 1. That petitioner they are represented to be. It has been simply stated
TECHNICAL "K.M.K. Gani" is by Attorney Padilla that K.M.K. Gani is "a single
SMUGGLING a single proprietorship," while INDRAPAL is "a firm," and
UNDER THE proprietorship both are "doing business in accordance with the laws
TARIFF AND doing business in of Singapore ... ," with specified addresses in
CUSTOMS accordance with Singapore. In cases of this nature, these allegations
CODE. the laws of are not sufficient to clothe a claimant of suspected
The issues before us are therefore: (1) whether or not Singapore with smuggled goods of juridical personality and
the private respondents failed to establish their address at 99 existence. The "isolated transaction rule" refers only
personality to sue in a representative capacity, hence Greenfield Drive, to foreign corporations. Here the petitioners are not
making their action dismissable, and (2) whether or Singapore, Rep. foreign corporations. They do not even pretend to be
not the subject goods were importations intended for of Singapore, so. The first paragraph of their petition before the
the Philippines in violation of the Tariff and Customs while Petitioner Court, containing the allegation of their identities,
Code. INDRAPAL and does not even aver their corporate character. On the
We answer both questions in the affirmative. COMPANY" is a contrary, K.M.K. alleges that it is a "single
The law is clear: "No foreign corporation transacting firm doing proprietorship" while INDRAPAL hides under the
business in the Philippines without a license, or its business in vague identification as a "firm," although both
successors or assigns, shall be permitted to maintain accordance with describe themselves with the phrase "doing business
or intervene in any action, suit or proceeding in any the laws of in accordance with the laws of Singapore."
court or administrative agency of the Philippines; but Singapore with Absent such proof that the private respondents are
such corporation may be sued or proceeded against office address at corporations (foreign or not), the respondent Court of
before Philippine courts or administrative tribunals 97 High Street, Tax Appeals should have barred their invocation of
on any valid cause of action recognized under Singapore 0641, the right to sue within Philippine jurisdiction under
Philippine laws." 7 Republic of the "isolated transaction rule" since they do not
However, the Court in a long line of cases has held Singapore, and qualify for the availment of such right.
that a foreign corporation not engaged in business in summons as well As we had stated before:
the Philippines may not be denied the right to file an as other Court
 But merely to say that a foreign
corporation not doing business in
the Philippines does not need a
license in order to sue in our courts
does not completely resolve the
issue in the present case. The
proposition as stated, refers to the
right to sue; the question here refers
to pleading and procedure. It
should be noted that insofar as the
allegations in the complaint have a
bearing on appellant's capacity to
sue, all that is averred is that they
are both foreign corporations
existing under the laws of the
United States. This averment
conjures two alternative
possibilities: either they are
engaged in business in the
Philippines or they are not so
engaged. If the first, they must have
been duly licensed in order to
maintain this suit; if the second, if
(sic) the transaction sued upon is
singular and isolated, no such
license is required. In either case,
the qualifying circumstance is an
essential part of the element of
plaintiffs capacity to sue and must
be affirmatively pleaded. 11
In this connection, we note also a fatal defect in the
pleadings of the private respondents. There is no
allegation as to who is the duly authorized
representative or resident agent in our jurisdiction.
All we have on record are the pleadings filed by
Attorney Armando S. Padilla who represents himself
as the counsel for the private respondents.
xxxxxxxxx
It is incumbent on plaintiff to allege
sufficient facts to show that he is
concerned with the cause of action
averred, and is the party who has
suffered injury by reason of the acts
of defendant; in other words, it is
not enough that he alleges a cause
of action existing in favor of
someone, but he must show that it
exists in favor of himself. The
burden should not be placed on
defendant to show that plaintiff is
not the aggrieved person and that
he has sustained no damages. It is
also necessary for plaintiff to allege
facts showing that the causes of
action alleged accrued to him in the
capacity in which he sues, and for
this purpose it is necessary for
someone for one who sues
otherwise than in his individual
capacity to allege his authority.
xxxxxxxxx
The plaintiff must show, in his
pleading, his right and interest in
the subject matter of the suit; and a
complaint which does not show
that plaintiff has the requisite
interest to enable him to maintain
his action should be dismissed for
insufficiency ... 12
xxxxxxxxx
The appearance of Atty, Armando S. Padilla as
counsel for the two claimants would not suffice.
Generally, a "lawyer is presumed to be properly
authorized to represent any cause in which he
appears, and no written power of attorney is required
to authorize him to appear in court for his
client." 13 Nevertheless, although the authority of an
attorney to appear for and on behalf of a party may be
assumed, it can still be questioned or challenged by
the adverse party concerned. 14
The presumption established under the provision of
Section 21, Rule 138 of the Revised Rules of Court is
disputable. 15 The requirement for the production of
authority is essential because the client will be bound
by his acquiescence resulting from his knowledge
that he was being represented by said attorney. 16
The Solicitor General, representing the petitioner-
appellant, not only questions the authority of Atty.
Armando S. Padilla to represent the private
respondents but also the latter's capacity to sue:
... While it is alleged that the
summons and court processes may
be served to herein private
respondents' counsel who filed the
unverified petition before the Court
of Tax Appeals, the allegation
would be insufficient for the
purpose of binding foreign
corporations as in the instant case.
To be sure, the admitted absence of
special power of attorney in favor
of their counsel, the relationship
with the latter, if at all, is merely
that of a lawyer-client relationship
and definitely not one of a principal
agent. Such being the case, said
counsel cannot bind nor
compromise the interest of private
respondents as it is possible that the
latter may disown the former's
representation to avoid civil or
criminal liability. In this respect,
the Court cannot assume
jurisdiction over the person of
private respondents,
notwithstanding the filing of the
unverified petition in question.
Apart from the foregoing, Section
4, Rule 8, Revised Rules of Court
mandates that facts showing the
capacity of a party to sue or be
sued; or the authority of a party to
sue or be sued in a representative
capacity; or the legal existence of
an organized association of person
(sic) that is made a party, must be
averred. In like manner, the rule is
settled that in case where the law
denies a foreign corporation to
maintain a suit unless it has
previously complied with certain
requirements, then such compliance
or exemption therefrom, becomes a
necessary averment in the
complaint (Atlantic Mutual Inc. Co.
v. Cebu Stevedoring Co., Inc. 17
SCRA 1037; vide; Sec. 4, Rule 8,
Revised Rules of Court). In the
 case at bar, apart from merely
alleging that private respondents
are foreign corporation (sic) and
that summons may be served to
their counsel, their petition in the
Court of Tax Appeals is bereft of
any other factual allegation to show
their capacity to sue or be sued in a
representative capacity in his
jurisdiction. 17
The representation and the extent of the authority of
Atty. Padilla have thus been expressly challenged.
But he ignored such challenge which leads us to the
only conclusion that he has no authority to appear for
such clients if they exist, which we even doubt. In
cases like this, it is the duty of the government
officials concerned to require competent proof of the
representation and authority of any claimant of any
goods coming from abroad and seized by our
customs authorities or otherwise appearing to be
illegally imported. This desired meticulousness,
strictness if you may, should extend to their
representatives and counsel. Our government has lost
considerable sums of money due to such dubious
claims or claimants.
Apropos the second issue, suffice it to state that we
agree with the findings, already enumerated and
discussed at the outset, made by the Collector of
Customs in his decision, dated July 14, 1983, which
was affirmed and amplified by the decision of the
Commissioner of Customs, that those constitute
sufficient evidence to support the conclusion that
there was an intention to unlade the seized goods in
the Philippines instead of its supposed destination,
Singapore. There is no need of belaboring them
anymore.
WHEREFORE, the petition is GRANTED; the
decision of the Court of Tax Appeals is SET ASIDE,
and the decision of the petitioner is hereby
REINSTATED.
No costs.
SO ORDERED.
G.R. No. 97816 July 24, 1992
MERRILL LYNCH FUTURES, INC., petitioner,
vs.
HON. COURT OF APPEALS, and the SPOUSES
PEDRO M. LARA and ELISA G.
LARA, respondents.
NARVASA, C.J.:
The capacity of a foreign corporation to maintain an
action in the Philippines against residents thereof, is
the principal question in the appellate proceedings at
bar. The issue arises from the undisputed facts now to
be briefly narrated.
On November 23, 1987, Merrill Lynch Futures, Inc.
(hereafter, simply ML FUTURES) filed a complaint
with the Regional Trial Court at Quezon City against
the Spouses Pedro M. Lara and Elisa G. Lara for the
recovery of a debt and interest thereon, damages, and
attorney's fees. 1 In its complaint ML FUTURES
described itself as —
a) a non-resident foreign
corporation, not doing business in
the Philippines, duly organized and
existing under and by virtue of the
laws of the state of Delaware,
U.S.A.;" as well as
b) a "futures commission
merchant" duly licensed to act as
such in the futures markets and
exchanges in the United States, . .
essentially functioning as a broker .
. (executing) orders to buy and sell
futures contracts received from its
customers on U.S. futures
exchanges.
It also defined a "futures contract" as a "contractual
commitment to buy and sell a standardized quantity
of a particular item at a specified future settlement
date and at a price agreed upon, with the purchase or
sale being executed on a regulated futures exchange."
In its complaint ML FUTURES alleged the
following:
1) that on September 28, 1983 it entered into a
Futures Customer Agreement with the defendant
spouses (Account No. 138-12161), in virtue of which
it agreed to act as the latter's broker for the purchase
and sale of futures contracts in the U.S.;
2) that pursuant to the contract, orders to buy and sell
futures contracts were transmitted to ML FUTURES
by the Lara Spouses "through the facilities of Merrill
Lynch Philippines, Inc., a Philippine corporation and
a company servicing plaintiffs customers; 2
3) that from the outset, the Lara Spouses "knew and
were duly advised that Merrill Lynch Philippines,
Inc. was not a broker in futures contracts," and that it
"did not have a license from the Securities and
Exchange Commission to operate as a commodity
trading advisor (i.e., 'an entity which, not being a
broker, furnishes advice on commodity futures to
persons who trade in futures contracts');
4) that in line with the above mentioned agreement
and through said Merrill Lynch Philippines, Inc., the
Lara Spouses actively traded in futures contracts,
including "stock index futures" for four years or
so, i.e., from 1983 to October, 1987, 3 there being
more or less regular accounting and corresponding
remittances of money (or crediting or debiting) made
between the spouses and ML FUTURES;
5) that because of a loss amounting to
US$160,749.69 incurred in respect of three (3)
transactions involving "index futures," and after
setting this off against an amount of US$75,913.42
then owing by ML FUTURES to the Lara Spouses,
said spouses became indebted to ML FUTURES for
the ensuing balance of US$84,836.27, which the
latter asked them to pay;
6) that the Lara Spouses however refused to pay this
balance, "alleging that the transactions were null and
void because Merrill Lynch Philippines, Inc., the
Philippine company servicing accounts of plaintiff, . .
had no license to operate as a 'commodity and/or
financial futures broker.'"
On the foregoing essential facts, ML FUTURES
prayed (1) for a preliminary attachment against
defendant spouses' properties "up to the value of at
least P2,267,139.50," and (2) for judgment, after trial,
sentencing the spouses to pay ML FUTURES:
a) the Philippine peso equivalent of
$84,836.27 at the applicable
exchanged rate on date of payment,
with legal interest from date of
demand until full payment;
b) exemplary damages in the sum
of at least P500,000.00; and
c) attorney's fees and expenses of
litigation as may be proven at the
trial.
Preliminary attachment issued ex parte on December
2, 1987, and the defendant spouses were duly served
with summons.
They then filed a motion to dismiss dated December
18, 1987 on the grounds that:
(1) plaintiff ML FUTURES had
"no legal capacity to sue" and
(2) its "complaint states no cause of
action since . . (it) is not the real
party in interest."
In that motion to dismiss, the defendant spouses
averred that:
a) although not licensed to do so, ML FUTURES had
been doing business in the Philippines "at least for
the last four (4) years," this being clear from the very
allegations of the complaint; consequently, ML
FUTURES is prohibited by law "to maintain or
intervene in any action, suit or proceeding in any
court or administrative agency of the Philippines;"
and
b) they had never been informed that Merrill Lynch
Philippines, Inc. was not licensed to do business in
this country; and contrary to the allegations of the
complaint, all their transactions had actually been
with MERRILL LYNCH PIERCE FENNER &
SMITH, INC., and not with ML FUTURES (Merrill
Lynch Futures, Inc.), in proof of which they attached
to their motion to dismiss copies of eight (8)
agreements, receipts or reminders, etc., executed on
standard printed forms of said Merrill Lynch Pierce
Fenner& Smith Inc. 4
ML FUTURES filed an OPPOSITION to the
defendant spouses' motion to dismiss. In that motion
—
a) it drew attention to paragraph 4 of its complaint,
admitted by defendants, that the latter "have been
actively trading in futures contracts . . . in U.S.
futures exchanges from 1983 to 1987," and ask, "If
the trading . . . (was) made in U.S., how could
plaintiff be doing business in the Philippines?"
b) it also drew attention to a printed form of "Merrill
Lynch Futures, Inc." filled out and signed by
defendant spouses when they opened an account with
ML Futures, in order to supply information about
themselves, including their bank's name —
(1) in which
appear the
following
epigraph:
"Account
introduced by
Merrill Lynch
International,
Inc.," and the
following
statements, to
wit:
This Commodity Trading Advisor
(Merrill Lynch, Pierce, Fenner&
Smith Philippines, Inc.) is
prohibited by the Philippine
Securities and Exchange
Commission from accepting funds
in the trading advisor's name from a
client of Merrill Lynch Futures,
Inc. for trading commodity
interests. All funds in this trading
program must be placed with
Merrill Lynch Futures, Inc.;
and
. . . It is agreed between MERRILL
LYNCH, PIERCE, FENNER &
SMITH INC., and other account
carrying MERRILL LYNCH
entities and their customers that all
legal relationships between them
will be governed by applicable
laws in countries outside the
Philippines where sale and
purchase transactions take place.
c) and it argued that —
(1) it is not permitted for defendant
spouses to present "evidence" in
connection with a motion to
dismiss based on failure of the
complaint to state a cause of action;
(2) even if the documents appended
to the motion to dismiss be
considered as admissible
"evidence," the same would be
immaterial since the documents
refer to a different account
number: 138-12136, the defendants'
account number with ML
FUTURES being 138-12161;
(3) it is a lie for the defendant
spouses to assert that they were
never informed that Merrill Lynch
Philippines, Inc. had not been
licensed to do business in the
Philippines; and
(4) defendant spouses should not be
allowed to "invoke the aid of the
court with unclean hands.
The defendant spouses filed a REPLY reaffirming
their lack of awareness that Merrill Lynch
Philippines, Inc.(formerly registered as Merrill
Lynch, Pierce, Fenner& Smith Philippines, Inc.) 5 did
not have a license, claiming that they learned of this
only from inquiries with the Securities and Exchange
Commission which elicited the information that it
had denied said corporation's application to operate
as a commodity futures trading advisor — a denial
subsequently affirmed by the Court of Appeals
(Merrill Lynch Philippines, Inc. v. Securities &
Exchange Commission, CA-G.R. No. 10821-
SP, Nov. 19, 1987). The spouses also submitted
additional documents (Annexes J to R) involving
transactions with Merrill Lynch Pierce Fenner&
Smith, Inc., dating back to 1980, stressing that all but
one of the documents "refer to Account No. 138-
12161 which is the very account that is involved in
the instant complaint."
ML FUTURES filed a Rejoinder alleging it had
given the spouses a disclosure statement by which the
latter were made aware that the transactions they
were agreeing on would take place outside of the
Philippines, and that "all funds in the trading program
must be placed with Merrill Lynch Futures, Inc."
On January 12, 1988, the Trial Court promulgated an
Order sustaining the motion to dismiss, directing the
dismissal of the case and discharging the writ of
preliminary attachment. It later denied ML
FUTURES's motion for reconsideration, by Order
dated February 29, 1988. ML FUTURES appealed to
the Court of Appeals. 6
In its own decision promulgated on November 27,
1990, 7 the Court of Appeals affirmed the Trial
Court's judgment. It declared that the Trial Court had
seen "through the charade in the representation of
MLPI and the plaintiff that MLPI is only a trading
advisor and in fact it is a conduit in the plaintiff's
business transactions in the Philippines as a basis for
invoking the provisions of Section 133 of the
Corporation Code," 8 viz.:
Sec. 133.Doing business without a
license. — No foreign corporation
transacting business in the
Philippines without a license, or its
successors or assigns, shall be
permitted to maintain or intervene
in any action, suit or proceeding in
any court or administrative agency
in the Philippines; but such
corporation may be sued or
proceeded against before Philippine
courts or administrative tribunals
on any valid cause of action
recognized under Philippine laws.
It also declared that the evidence established
that plaintiff had in fact been "doing
business" in this country in legal
contemplation, adverting to Mentholatum
v. Mangaliman, 72 Phil. 524, 528-530, and
Section 1 of Republic Act No. 5455 reading
as follows: 9
Sec. 1. Definition and scope of this
ACT . (1) As used in this Act, the
term "investment" shall mean
equity participation in any
enterprise formed, organized, or
existing under the laws of the
Philippines; and the phrase "doing
business" shall INCLUDE
soliciting orders, purchases,
 service contracts, opening
offices, whether called "liaison"
offices or branches; appointing
representatives or distributors who
are domiciled in the Philippines or
who in any calendar year stay in
the Philippines for a period or
periods totalling one hundred
eighty days or more; participating
in the management, supervision or
control of any domestic business
firm, entity or corporation in the
Philippines; AND ANY OTHER
ACT OR ACTS THAT IMPLY A
CONTINUITY OF
COMMERCIAL DEALINGS OR
ARRANGEMENTS AND
CONTEMPLATE TO THAT
EXTENT THE PERFORMANCE
OF ACTS OR WORKS, OR THE
EXERCISE OF SOME
FUNCTIONS NORMALLY
INCIDENT TO, AND IN
PROGRESSIVE PROSECUTION
OF COMMERCIAL GAIN OR OF
THE PURPOSE AND OBJECT
OF THE BUSINESS
ORGANIZATION.
As regards the claim that it was error for the Trial
Court to place reliance on the decision of the Court of
Appeals in CA-G.R. No. 10821-SP — sustaining the
finding of the Securities & Exchange Commission
that ML FUTURES was doing business in the
Philippines — since that judgment was not yet final
and ML FUTURES was not a party to that
proceeding, the Court of Appeals ruled that there was
no need to belabor the point considering that there
was, in any event, "adequate proof of the activities of
MLPI . . . which manifestly show that the plaintiff
(ML FUTURES) performed a series of business acts,
consummated contracts and undertook transactions
for the period from 1983 to October 1987," "and
because ML FUTURES had done so without license,
it consequently had "no legal personality to bring suit
in Philippine courts."
Its motion for reconsideration having been
denied, 10 ML FUTURES has appealed to this Court
on certiorari. Here, it submits the following issues
for resolution:
(a) Whether or not the annexes
appended by the Laras to their
Motion to Dismiss and Reply filed
with the Regional Trial Court, but
never authenticated or offered,
constitute admissible evidence.
(b) Whether or not in the
proceedings below, ML FUTURES
has been accorded procedural due
process.
(c) Whether or not the annexes,
assuming them to be admissible,
established that ML FUTURES
was doing business in the
Philippines without a license.
As just stated, the Lara Spouse's motion to dismiss
was founded on two (2) grounds: (a) that the plaintiff
has no legal capacity to sue, and (b) that the
complaint states no cause of action (Sec. 1 [d], and
[g], Rule 16, Rules of Court).
As regards the second ground, i.e., that the complaint
states no cause of action, the settled doctrine of
course is that said ground must appear on the face of
the complaint, and its existence may be determined
only by the allegations of the complaint,
consideration of other facts being proscribed, and any
attempt to prove extraneous circumstances not being
allowed. 11 The test of the sufficiency of the facts
alleged in a complaint as constituting a cause of
action is whether or not, admitting the facts alleged,
the court might render a valid judgment upon the
same in accordance with the prayer of the
complaint. 12 Indeed, it is error for a judge to conduct
a preliminary hearing and receive evidence on the
affirmative defense of failure of the complaint to
state a cause of action. 13
The other ground for dismissal relied upon, i.e., that
the plaintiff has no legal capacity to sue — may be
understood in two senses: one, that the plaintiff is
prohibited or otherwise incapacitated by law to
institute suit in Philippine Courts, 14 or two, although
not otherwise incapacitated in the sense just stated,
that it is not a real party in interest. 15Now, the Lara
Spouses contend that ML Futures has no capacity to
sue them because the transactions subject of the
complaint were had by them, not with the plaintiff
ML FUTURES, but with Merrill Lynch Pierce
Fenner& Smith, Inc. Evidence is quite obviously
needed in this situation, for it is not to be expected
that said ground, or any facts from which its
existence may be inferred, will be found in the
averments of the complaint. When such a ground is
asserted in a motion to dismiss, the general rule
governing evidence on motions applies. The rule is
embodied in Section 7, Rule 133 of the Rules of
Court.
Sec. 7.Evidence on motion. —
When a motion is based on facts
not appearing of record the court
may hear the matter on affidavits or
depositions presented by the
respective parties, but the court
may direct that the matter be heard
wholly or partly on oral testimony
or depositions.
There was, to be sure, no affidavit or deposition
attached to the Lara Spouses' motion to dismiss or
thereafter proffered in proof of the averments of their
motion. The motion itself was not verified. What the
spouses did do was to refer in their motion to
documents which purported to establish that it was
not with ML FUTURES that they had theretofore
been dealing, but another, distinct entity, Merrill
Lynch, Pierce, Fenner& Smith, Inc., copies of which
documents were attached to the motion. It is
significant that ML FUTURES raised no issue
relative to the authenticity of the documents thus
annexed to the Laras' motion. In fact, its arguments
subsumed the genuineness thereof and even adverted
to one or two of them. Its objection was centered on
the propriety of taking account of those documents as
evidence, considering the established principle that
no evidence should be received in the resolution of a
motion to dismiss based on an alleged failure of the
complaint to state a cause of action.
There being otherwise no question respecting the
genuineness of the documents, nor of their relevance
to at least one of the grounds for dismissal — i.e., the
prohibition on suits in Philippine Courts by foreign
corporations doing business in the country without
license — it would have been a superfluity for the
Court to require prior proof of their authenticity, and
no error may be ascribed to the Trial Court in taking
account of them in the determination of the
motion on the ground, not that the complaint fails to
state a cause of action — as regards which evidence
is improper and impermissible — but that the
plaintiff has no legal capacity to sue — respecting
which proof may and should be presented.
Neither may ML FUTURES argue with any degree
of tenability that it had been denied due process in
the premises. As just pointed out, it was very clear
from the outset that the claim of lack of its capacity
to sue was being made to rest squarely on the
documents annexed thereto, and ML FUTURES had
more than ample opportunity to impugn those
documents and require their authentication, but did
not do so. To sustain its theory that there should have
been identification and authentication, and formal
offer, of those documents in the Trial Court pursuant
to the rules of evidence would be to give unwarranted
importance to technicality and make it prevail over
the substance of the issue.
The first question then, is, as ML FUTURES
formulates it, whether or not the annexes, assuming
them to be admissible, establish that (a) ML
FUTURES is prohibited from suing in Philippine
Courts because doing business in the country without
a license, and that (b) it is not a real party in interest
since the Lara Spouses had not been doing business
with it, but with another corporation, Merrill Lynch,
Pierce, Fenner& Smith, Inc.
The Court is satisfied that the facts on record
adequately establish that ML FUTURES, operating in
the United States, had indeed done business with the
Lara Spouses in the Philippines over several years,
had done so at all times through Merrill Lynch
Philippines, Inc. (MLPI), a corporation organized in
this country, and had executed all these transactions
without ML FUTURES being licensed to so transact
business here, and without MLPI being authorized to
operate as a commodity futures trading advisor.
These are the factual findings of both the Trial Court
and the Court of Appeals. These, too, are the
conclusions of the Securities & Exchange
Commission which denied MLPI's application to
operate as a commodity futures trading advisor, a
denial subsequently affirmed by the Court of
Appeals. Prescinding from the proposition that
factual findings of the Court of Appeals are generally
conclusive this Court has been cited to no
circumstance of substance to warrant reversal of said
Appellate Court's findings or conclusions in this case.
The Court is satisfied, too, that the Laras did transact
business with ML FUTURES through its agent
corporation organized in the Philippines, it being
unnecessary to determine whether this domestic firm
was MLPI (Merrill Lynch Philippines, Inc.) or
Merrill Lynch Pierce Fenner& Smith (MLPI's alleged
predecessor). The fact is that ML FUTURES did deal
with futures contracts in exchanges in the United
States in behalf and for the account of the Lara
Spouses, and that on several occasions the latter
received account documents and money in
connection with those transactions.
Given these facts, if indeed the last transaction
executed by ML FUTURES in the Laras's behalf had
resulted in a loss amounting to US $160,749.69; that
in relation to this loss, ML FUTURES had credited
the Laras with the amount of US$75,913.42 — which
it (ML FUTURES) then admittedly owed the spouses
— and thereafter sought to collect the balance,
US$84,836.27, but the Laras had refused to pay (for
the reasons already above stated), the crucial question
is whether or not ML FUTURES may sue in
Philippine Courts to establish and enforce its rights
against said spouses, in light of the undeniable fact
that it had transacted business in this country without
being licensed to do so. In other words, if it be true
that during all the time that they were transacting
with ML FUTURES, the Laras were fully aware of
its lack of license to do business in the Philippines,
and in relation to those transactions had made
payments to, and received money from it for several
years, the question is whether or not the Lara Spouses
are now estopped to impugn ML FUTURES' capacity
to sue them in the courts of the forum.
The rule is that a party is estopped to challenge the
personality of a corporation after having
acknowledged the same by entering into a contract
with it. 16 And the "doctrine of estoppel to deny
corporate existence applies to foreign as well as to
domestic corporations;" 17 "one who has dealt with a
corporation of foreign origin as a corporate entity is
estopped to deny its corporate existence and
capacity." 18 The principle "will be applied to prevent
a person contracting with a foreign corporation from
later taking advantage of its noncompliance with the
statutes, chiefly in cases where such person has
received the benefits of the contract (Sherwood v.
Alvis, 83 Ala 115, 3 So 307, limited and
distinguished in Dudley v. Collier, 87 Ala 431, 6 So
304; Spinney v. Miller, 114 Iowa 210, 86 NW 317),
where such person has acted as agent for the
corporation and has violated his fiduciary obligations
as such, and where the statute does not provide that
the contract shall be void, but merely fixes a special
penalty for violation of the statute. . . ." 19
The doctrine was adopted by this Court as early as
1924 in Asia Banking Corporation v. Standard
Products Co., 20in which the following
pronouncement was made: 21
The general rule that in the absence
of fraud of person who has
contracted or otherwise dealt with
an association in such a way as to
recognize and in effect admit its
legal existence as a corporate body
is thereby estopped to deny its
corporate existence in any action
leading out of or involving such
contract or dealing, unless its
existence is attacked for causes
which have arisen since making the
contract or other dealing relied on
as an estoppel and this applies to
foreign as well as domestic
corporations. (14C.J .7; Chinese
Chamber of Commerce vs.
PuaTeChing, 14 Phil. 222).
There would seem to be no question that the Laras
received benefits generated by their business
relations with ML FUTURES. Those business
relations, according to the Laras themselves, spanned
a period of seven (7) years; and they evidently found
those relations to be of such profitability as warranted
their maintaining them for that not insignificant
period of time; otherwise, it is reasonably certain that
they would have terminated their dealings with ML
FUTURES much, much earlier. In fact, even as
regards their last transaction, in which the Laras
allegedly suffered a loss in the sum of
US$160,749.69, the Laras nonetheless still received
some monetary advantage, for ML FUTURES
credited them with the amount of US$75,913.42 then
due to them, thus reducing their debt to
US$84,836.27. Given these facts, and assuming that
the Lara Spouses were aware from the outset that ML
FUTURES had no license to do business in this
country and MLPI, no authority to act as broker for
it, it would appear quite inequitable for the Laras to
evade payment of an otherwise legitimate
indebtedness due and owing to ML FUTURES upon
the plea that it should not have done business in this
country in the first place, or that its agent in this
country, MLPI, had no license either to operate as a
"commodity and/or financial futures broker."
Considerations of equity dictate that, at the very least,
the issue of whether the Laras are in truth liable to
ML FUTURES and if so in what amount, and
whether they were so far aware of the absence of the
requisite licenses on the part of ML FUTURES and
its Philippine correspondent, MLPI, as to be estopped
from alleging that fact as defense to such liability,
should be ventilated and adjudicated on the merits by
the proper trial court.
WHEREFORE, the decision of the Court of Appeals
in CA-G.R. CV No. 16478 dated November 27, 1990
and its Resolution of March 7, 1991 are REVERSED
and SET ASIDE, and the Regional Trial Court at
Quezon City, Branch 84, is ORDERED to reinstate
Civil Case No. Q-52360 and forthwith conduct a
hearing to adjudicate the issues set out in the
preceding paragraph on the merits.
SO ORDERED.
G.R. No. L-55687 July 30, 1982
JUASING HARDWARE, petitioner,
vs.
THE HONORABLE RAFAEL T. MENDOZA,
Judge of the Court of First Instance of Cebu, and
PILAR DOLLA,respondents.
Luis V. Diones, Paulito Y. Cabrera and Victor C.
Laborte for petitioner.
Amadeo D. Seno for respondents.
GUERRERO, J.:
In this special civil action for certiorari, petitioner
Juasing Hardware seeks to annul the Orders of
respondent Judge dated September 5, 1980 and
October 21, 1980 issued in Civil Case No. R-18386.
Records show the pertinent factual and procedural
antecedents of the instant Petition to be as follows:
On August 17, 1979, Juasing Hardware, alleging to
be a single proprietorship duly organized and existing
under and by virtue of the laws of the Philippines and
represented by its manager Ong Bon Yong, filed a
complaint for the collection of a sum of money
against PilarDolla. 1 The complaint charged that
defendant Dolla failed and refused to pay, despite
repeated demands, the purchase price of items,
materials and merchandise which she bought from
the plaintiff. 2 In her Answer, defendant stated,
among others, that she "has no knowledge about
plaintiff's legal personality and capacity to sue as
alleged in ... the complaint." 3 The case proceeded to
pre-trial and trial. After plaintiff had completed the
presentation of its evidence and rested its case,
defendant filed a Motion for Dismissal of Action
(Demurrer to Evidence) 4praying that the action be
dismissed for plaintiff's lack of legal capacity to sue.
Defendant in said Motion contended that plaintiff
Juasing Hardware is a single proprietorship, not a
corporation or a partnership duly registered in
accordance with law, and therefore is not a juridical
person with legal capacity to bring an action in court.
Plaintiff filed an Opposition and moved for the
admission of an Amended Complaint. 5
Resolving the foregoing controversy, respondent
Judge issued the Order dated September 5, 1980
dismissing the case and denying admission of the
Amended Complaint. Pertinent portions of said Order
follow:
The Answer of the defendant to the
complaint alleged the lack of legal
capacity to sue of the plaintiff as
contained in its affirmative defense.
inspite of the allegation that
plaintiff has no legal capacity to
sue, the plaintiff insisted in
proceeding to trial instead of
amending the Complaint. During
the trial, it was found out that the
affirmative defense of defendant of
plaintiff's lack of legal capacity to
sue is very evident for plaintiff
Juasing Hardware is a single
proprietorship which is neither a
partnership nor a corporation. The
amendment therefore ' is now too
late it being substantial.
In view of all the foregoing, this
case is hereby DISMISSED with
costs de oficio. 6
Plaintiff's Motion for Reconsideration of the above
Order was denied in another Order issued by
respondent Judge on October 21, 1980. 7
The sole issue in this case is whether or not the lower
court committed a grave abuse of discretion when it
dismissed the case below and refused to admit the
Amended Complaint filed by therein plaintiff, now
herein petitioner, Juasing Hardware.
Rule 3 of the Revised Rules of Court provides as
follows:
Sec. 1. Who may be parties.-Only
natural or juridical persons or
entities authorized by law may be
parties in a civil action.
Petitioner is definitely not a natural person; nor is it a
juridical person as defined in the New Civil Code of
the Philippines thus:
Art. 44. The following are juridical
persons:
(1) The State and its political
subdivisions;
(2) Other corporations, institutions
and entities for public interest or
purpose, created by law; their
personality begins as soon as they
have been constituted according to
law;
(3) Corporations, partnerships and
associations for private interest or
purpose to which the law grants a
juridical personality, separate and
distinct from that of each
shareholder, partner or member.
Finally, there is no law authorizing sole
proprietorships like petitioner to bring suit in court.
The law merely recognizes the existence of a sole
proprietorship as a form of business organization
conducted for profit by a single individual, and
requires the proprietor or owner thereof to secure
licenses and permits, register the business name, and
pay taxes to the national government. It does not vest
juridical or legal personality upon the sole
proprietorship nor empower it to file or defend an
action in court.
Thus, the complaint in the court below should have
been filed in the name of the owner of Juasing
Hardware. The allegations in the body of the
complaint would show that the suit is brought by
such person AS proprietor or owner of the business
conducted under the name and style Juasing
Hardware". The descriptive words "doing business as
Juasing Hardware' " may be added in the title of the
case, as is customarily done.
Be that as it may, petitioner's contention that
respondent Judge erred in not allowing the
amendment of the complaint to correct the
designation of the party plaintiff in the lower court, is
impressed with merit. Such an amendment is
authorized by Rule 10 of the Revised Rules of Court
which provides thus:
Sec. 4.Formal Amendments. — A
defect in the designation of the
parties may be summarily
correctedat any stage of the
action provided no prejudice is
caused thereby to the adverse party.
(Emphasis supplied.)
Contrary to the ruling of respondent Judge, the defect
of the complaint in the instant case is merely formal,
not substantial. Substitution of the party plaintiff
would not constitute a change in the Identity of the
parties. No unfairness or surprise to private
respondent Dolla, defendant in the court a quo,
would result by allowing the amendment, the purpose
of which is merely to conform to procedural rules or
to correct a technical error.
In point is the case of Alonzo vs. Villamor, et
al. 8 which applied Sec. 110 of the Code of Civil
Procedure authorizing the court "in furtherance of
justice ... (to) allow a party to amend any pleading or
proceeding and at any stage of the action, in either
the Court of First Instance or the Supreme Court, by
adding or striking out the name of any party, either
plaintiff or defendant, or by correcting a mistake in
the name of a party ..." In the Alonzo case, Fr. Eladio
Alonzo, a priest of the Roman Catholic Church,
brought an action to recover from therein defendants
the value of certain properties taken from the Church.
The defendants contended that Fr. Alonzo was not
the real party in interest. This Court, speaking
through Justice Moreland, ordered the substitution of
the Roman Catholic Apostolic Church in the place
and stead of Eladio Alonzo as party plaintiff, and
aptly held in this wise:
... Defect in form cannot possibly
prejudice so long as the substantial
is clearly evident. ...
No one has been misled by the
error in the name of the party
plaintiff. If we should by reason of
this error send this case back for
amendment and new trial, there
would be on the retrial the same
complaint, the same answer, the
same defense, the same interests,
the same witnesses, and the same
evidence. The name of the plaintiff
would constitute the only
difference between the old trial and
the new. In our judgment there is
not enough in a name to justify
such action.
There is nothing sacred about
processes or pleadings, their forms
or contents. Their sole purpose is to
facilitate the application of justice permitted to challenge a record of a
to the rival claims of contending court ... for defect of form when his
parties. They were created, not to substantial rights have not been
hinder and delay, but to facilitate prejudiced thereby. 9
and promote, the administration of We reiterate what this Court had stated in the more
justice. They do not constitute the recent case of Shaffer vs. Palma 10 that "(t)he courts
thing itself, which courts are should be liberal in allowing amendments to
always striving to secure to pleadings to avoid multiplicity of suits and in order
litigants. They are designed as the that t he real controversies between the parties are
means best adapted to obtain that presented and the case decided on the merits without
thing. In other words, they are a unnecessary delay." 11 This rule applies with more
means to an end. When they lose reason and with greater force when, as in the case at
the character of the one and bar, the amendment sought to be made refers to a
become the other, the mere matter of form and no substantial rights are
administration of justice is at fault prejudiced. 12
and courts are correspondingly WHEREFORE, the Petition is hereby granted. The
remiss in the performance of their Orders dated September 5, 1980 and October 21,
obvious duty. 1980 are hereby annulled and the lower court is
The error in this case is purely hereby ordered to admit the Amended Complaint in
technical. To take advantage of it conformity with the pronouncements in this Decision.
for other purposes than to cure it, No costs.
does not appeal to a fair sense of SO ORDERED.
justice. Its presentation as fatal to Barredo (Chairman), Concepcion, Jr., Abad Santos,
the plaintiff's case smacks of skill and De Castro, JJ., concur.
rather than right. A litigation is not Escolin, J., concur in the result.
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 of form
and technicalities of procedure,
asks that justice be done upon the
merits. Lawsuits, unlike duels, are
not to be won by a rapier's thrust.
Technicality, when it deserts its
proper office as an aid to justice
and becomes its great hindrance
and chief enemy, deserves scant
consideration from courts. There
should be no vested rights in
technicalities. No litigant should be
G.R. No. 78646 July 23, 1991
PABLO RALLA, substituted by his wife and co-
defendant CARMEN MUÑOZ-RALLA, and his
legal heirs, HILDA RALLA-ALMINE, BELISTA,
RENE RALLA-BELISTA and GERARDO M.
RALLA, petitioners,
vs.
PEDRO RALLA, substituted by his legal heirs,
LEONI, PETER, and MARINELA all surnamed
RALLA, and COURT OF APPEALS, respondents.
Rafael Triunfante and Teodorico C. Almine, Jr. for
petitioners.
Ruben R. Basa for private respondents.
CRUZ, J.:p
RosendoRalla had two sons, Pablo and Pedro. The
father apparently loved the former but not the latter,
Pablo and his family lived with Rosendo, who took
care of all the household expenses. Pablo
administered part of the family properties and
received a monthly salary of P250.00 plus part of the
produce of the land. Pedro lived with his mother, Paz
Escarella, in another town. He was not on good terms
with his father.
Paz Escarella died in 1957 and the two brothers
partitioned 63 parcels of land she left as her
paraphernalia property. The partition was sustained
by this Court in G.R. Nos. 63253-54 on April 27,
1989. 1 Meanwhile, on December 22, 1958, Rosendo
executed a will disinheriting Pedro and leaving
everything he owned to Pablo, to whom he said he
had earlier sold a part of his property for P10,000.00.
Rosendo himself filed for the probate of the will
but pendente lite died on October 1, 1960.
On November 3, 1966, the probate judge converted
SP 564 into an intestate proceeding. On February 28,
1978, a creditor of the deceased filed a petition for
the probate of Rosendo's will in SP 1106, which was
heard jointly with SP 564. On August 3, 1979, the
order of November 3, 1966, was set aside.
The last will and testament of RosendoRalla was
allowed on June 7, 1982 2 but on October 20, 1982,
the disinheritance of Pedro was disapproved. 3 This
order was elevated to the Court of Appeals in AC-
G.R. Nos. 00472, 00489.
In a decision dated July 25, 1986, the Court of
Appeals 4 reversed the trial court and reinstated the
disinheritance clause after finding that the requisites
of a valid disinheritance had been complied with in
the will. The appellate court noted that Pedro had
threatened to kill his father, who was afraid of him
and had earlier sued him for slander and grave oral
defamation.
The decision was assailed before this Court in G.R.
Nos. 76657-58, which was dismissed in our
resolution of August 26, 1987, reading as follows:
. . . Assuming that, as claimed, the
petitioners' counsel received a copy
of the questioned decision only on
August 15, 1986 (although it
should have been earlier because it
was mailed to him at his address of
record on July 28, 1986), they had
15 days, or until August 30, 1986,
within which to move for its
reconsideration or appeal therefrom
by certiorari to this Court. Instead,
they filed on August 28, 1986, a
motion for extension of time to file
a motion for reconsideration, which
was not allowed under our ruling in
Habaluyas Enterprises, Inc. v.
Japson, 142 SCRA 208, and so did
not interrupt the running of the
reglementary period. Indeed, even
if the period were to be counted
from October 7, 1986, when notice
of the denial of the motion for
extension was received by the
petitioners, the petition would still
be 30 days late, having been filed
on December 8, 1986. Moreover,
the petitioners have not shown that
the questioned decision is tainted
with grave abuse of discretion or
that it is not in accord with law and
jurisprudence. For these reasons,
the Court Resolved to DISMISS
the petition.
The motion for reconsideration was denied with
finality in the following resolution dated October 26,
1987:
. . . The Court, after deliberation,
Resolved to DENY with finality
the motion for reconsideration,
wherein the petitioners pray that
they be relieved from the effects of
our ruling in Habaluyas
Enterprises, Inc. v. Japson, 142
SCRA 208, under which the
petition was denied for tardiness.
Counsel are expected to be abreast
of current developments in law and
jurisprudence and cannot plead
ignorance thereof as an excuse for
non-compliance with the same. As
earlier observed, the petition was
filed extremely late, and, moreover,
it was inadequate even on the
merits, same having failed to show
that the questioned decision was
tainted with grave abuse of
discretion or reversible error.
What is involved in the present petition is the
correctness of the decision of the respondent court
annulling the deed of sale executed by RosendoRalla
in favor of Pablo over 149 parcels of land. Pedro had
filed on May 19, 1972, a complaint to annul the
transaction on the ground that it was simulated. 5 The
original decision of the trial court declared the sale
null and void. 6 In the resolution of the motion for
reconsideration, however, Judge Jose F. Madara
completely reversed himself and held the deed of sale
to be valid. 7 This order was in turn set aside by the
respondent court, which reinstated the original
decision invalidating the deed of sale.
It is indeed intriguing that the trial judge should, in
resolving the motion for reconsideration, make a
complete turnabout on the basis of the same evidence
and jurisprudence that he considered in rendering the
original decision. It is no less noteworthy that the
respondent court, after studying the two conclusions
reached by him, saw fit to sustain his original
findings as the correct appreciation of the evidence
and the applicable law.
But we find that, regardless of these curious
resolutions, the petition must nevertheless be
sustained albeit not on the ground that the deed of
sale was indeed valid. The Court is inclined to
support the findings of the respondent court.
However, we do not and cannot make any decision
on this matter because of one insuperable obstacle.
That obstacle is the proper party personality of Pedro
Ralla to question the transaction.
The decision of the Court of Appeals in AC-G.R.
Nos. 00472, 00489 approved the disinheritance of
Pedro Ralla. That decision was appealed to this
Court, but the petition for review was dismissed as
above related. The decision has long since become
final. Since then, Pedro Ralla no longer had the legal
standing to question the validity of the sale executed
by Rosendo in favor of his other son Pablo.
The real party-in-interest is the party who stands to
be benefited or injured by the judgment or the party
entitled to the avails of the suit. "Interest" within the
meaning of the rule means material interest, an
interest in issue and to be affected by the decree, as
distinguished from mere interest in the question
involved, or a mere incidental interest. As a general
rule, one having no right or interest to protect cannot
invoke the jurisdiction of the court as a party-plaintiff
in an action.
As the sole heir, Pablo Ralla had the right to inherit
the totality of his father's estate after payment of all
its debts. Even if it be assumed that the deed of sale
was indeed invalid, the subject-matter thereof
nevertheless devolved upon Pablo as the universal
successor of his father Rosendo. In his wig, Rosendo
claimed the 149 parcels as "part of my property" ––
as distinguished from the conjugal estate –– which he
had earlier sold to Pablo. Significantly, Pedro did not
deny this description of the property in his Comment
to the present petition, confining himself to assailing
the validity of the sale.
The Court must note the lackadaisical attitude of the
heirs of Pedro Ralla, who substituted him upon his
death. They seem to have lost interest in this
litigation, probably because of the approval of their
father's disinheritance by the respondent court. When
the parties were required to submit their respective
memoranda after we gave due course to this petition,
the petitioners did but not the private respondents.
Although the period to do so had already expired, the
Court relaxed its rules to give the private respondents
another opportunity to comply with the requirement.
When the resolution of August 22, 1990, could not be
served upon the private respondents' counsel, we
directed that it be served on the private respondents
themselves. 9 On January 18, 1991, the heirs of Pedro
Ralla informed the Court that they were retaining
another counsel and asked that they be furnished a
copy of the petition and given 30 days within which
to file their memorandum. 10 This motion was
granted. The records show that they received a copy
of the petition on February 26, 1991, but their
memorandum was never filed. On May 29, 1991, the
Court, noting this omission, finally resolved to
dispense with the memorandum and to decide this
case on the basis of the available records.
Our decision is that as a validly disinherited heir, and
not claiming to be a creditor of his deceased father,
Pedro Ralla had no legal personality to question the
deed of sale dated November 29, 1957, between
RosendoRalla and his son Pablo. Legally speaking,
Pedro Ralla was a stranger to the transaction as he
did not stand to benefit from its annulment. His
disinheritance had rendered him hors de combat.
WHEREFORE, the decision of the respondent court
dated January 23, 1987, is set aside and another
judgment is hereby rendered dismissing Civil Case
194 (originally Civil Case 4624) in this Regional
Trial Court of Ligao, Albay, Branch 5.
SO ORDERED.
G.R. No. 97463 June 26, 1992
JESUS M. IBONILLA, DOLORES R. GAPAS,
WILFRED BATERINA, AZUCENA
TABLANTE, ERNESTO SANTIAGO, ENRIQUE
AUZA, INOCENCIO BUOT, JR., GENE
PASAJE, RODOLFO SAN GABRIEL, JUANITA
ABELLANOSA, CAROLINA BONIEL, EPPE
CRISPO, ILDEFONSO TINAPAY, LUCIA
OMPAD, CATALINA SICAD, ABRAHAM
BARRIOQUINTO, ANTONIO ELISER,
ALBERTO TAGALOG, LEONARDA ESPINA,
LUCILE GIMARINO, ROMEO PINATEL,
HERNAN ESTABILLA, LEO PELLETERO,
BENITO PALER, JERICO BOLAMBAO, NOEL
CAMORO, REYNALDO VILLAROSA, RAMIL
MANAYON, JOSELITO MILAY, MANUEL
LABITAD, THERESA TINAPAY, CATHERINE
MARTTN, SUSAN ROLLAN, CRISELDA
CANA, MARIFE CEBALLOS, JANICE
ALBINO, ROLANDO S. TABUNA, ANTONIO
ALISER, MA. PAULETTE C. LEDRES, MIRA
COLITA, MODESTO CORTES, HERNAN
ESTAVILLA, JOANN ESPINA, SEVERINO
LEBUMFACIL, ROBERTO REGALADO,
KELLY AYUDA, MARINO OCHEA,
CARMELITA ARANCO, VICTORIA
TOMARONG, LOLITA MALAGAR, WILLY
REPOLLO, ANABELLA TRUZ, ARLENE
DONAN, GEOVANI ROMARATE, MACARIO
GUARIN, JULIUS POLAYAPOY, WILSON
BORDADORA, DARWIN LLESOL, and
BONIFACIO ILLUSTRISIMO, petitioners,
vs.
PROVINCE OF CEBU, CEBU STATE
COLLEGE OF SCIENCE & TECHNOLOGY
(College of Agriculture) formerly Sudlon
Agricultural School/Cebu (Sudlon) Agricultural
School, its BOARD OF TRUSTEES and/or
members namely, DR. LOURDES
QUISUMBING, DR. ATANASCIO ELMA, DR
FRANCISCO B. CONCILLO, MR. TOMAS
RAMOS and HON. EMILIO M.R. OSMEÑA.,
ALQUIN VILLAHERMOSA and the COURT OF
APPEALS, Manila, respondents.
GRIÑO-AQUINO, J.:
This is a petition for review on certiorari of the
decision dated February 8, 1991 of the Court of
Appeals in CA-G.R. CV No. 24536, affirming the
decision dated November 8, 1989 of the Regional
Trial Court of Cebu City which dismissed the
petitioners' complaint for Quieting of Title against the
private and public respondents.
In 1952, the use and usufruct of 40 parcels of land
was granted to the Cebu (Sudlon) Agricultural
School. On March 18, 1960, the province donated the
lots to the school with a view to bringing about the
conversion of the Cebu (Sudlon) Agricultural School
into a regional one, subject to two (2) conditions,
namely: (1) that if the School ceases to operate, the
ownership of the lots will automatically revert to the
Provincial Government of Cebu, and (2) that the
School cannot alienate, lease or encumber the
properties.
Pursuant to BP Blg. 412, incorporating and
consolidating as one school system certain vocational
schools in the Province of Cebu, the Cebu (Sudlon)
Agricultural School became an extension of the Cebu
State College of Agriculture an 1983.
On November 18, 1988, the Province of Cebu
demanded the return of the 40 donated lots, on the
ground that the donation was void ab initio as the
Cebu (Sudlon) Agricultural School did not have the
personality to be a donee of real property.
The petitioners (officials, faculty and employees of
the Cebu [Sudlon] Agricultural School, parents of the
enrolled students, and various school organizations)
opposed the rescission of the donation. They filed an
action to quiet title to the lots.
Answering the complaint, the Province of Cebu
alleged that the Deed of Donation in favor of the
School was null and void, and, as the Cebu Sudlon
Agricultural School ceased to exist and operate as
such, the lots should be reconveyed to the Province
of Cebu which admittedly plans to use them as a site
for the residences of the Regional Trial Court Judges,
an NBI Drug Rehabilitation Center, and other
government offices.
On March 10, 1989, the Province of Cebu filed a
motion to dismiss the action on the ground that it had
become moot and academic because on February 1,
1989, the Province of Cebu, represented by Governor
Emilio M. R. Osmeña, and the Cebu State College of
Science and Technology (CSCST), represented by
then Secretary Lourdes R. Quisumbing, entered into a
Memorandum of Agreement (Annex A) over the
subject parcels of land, allocating nineteen (19) lots
to the Province of Cebu, twenty three (23) lots to the
school, and reserving Lot No. 1033 (covered by TCT
No. 21411) for a national government center and
DECS regional office. The agreement was ratified by
the SangguniangPanlalawigan and the Board of
Trustees of the school.
Despite the agreement between the province and the
school, the petitioners refused to withdraw their suit.
On November 8, 1989, the trial court dismissed the
complaint on the ground that the plaintiffs, now
petitioners, are not real parties in interest. The
dispositive part of its decision reads:
Otherwise stated, the plaintiffs are
not the real parties in interest.
Without any more resolving the
issue whether or not the
Memorandum of Agreement is
either legal or was executed
illegally by the Secretary of
Education, Dismissal of this case is
the only option.
The foregoing considered,
judgment is hereby rendered
directing dismissal of this case,
without pronouncement as to costs.
(p. 73, Rollo.)
The petitioners appealed to the Court of Appeals
which, on February 8, 1991, affirmed the decision of
the trial court.
We have deliberated on the petition for review of that
decision, but failed to discover any cogent reason for
setting it aside. The numerous petitioners are
admittedly not the owners of the lots in question.
They do not claim any interest in them that was
violated, nor have they suffered any injury that might
warrant a grant of relief. Clearly, the finding of the
appellate court and the trial court that they are not
real parties in interest who may sue to quiet the title
to the properties in question, is correct.
Only a real party in interest is allowed to prosecute
and defend an action in court (Sec. 2, Rule 3 of the
Rules of Court).
By "real party in interest" is meant
such party who would be benefited
or injured by the judgment or
entitled to the avails of the suit. . . .
A real party in interest-plaintiff is
one who has a legal right, while a
real party in interest-defendant is
one who has a correlative legal
obligation whose act or omission
violates the legal right of the
former, (Lee vs. Romillo, Jr., 161
SCRA 589.)
. . . And by real interest, is meant a
present substantial interest, as
distinguished from a mere
expectancy, or future, contingent,
subordinate or consequential
interest (Garcia vs. David, 67 Phil.
279; Cited in Rules of Court, Vol. I
by Moran, p. 144 [1970 edition]).
The Court of Appeals correctly observed that the
execution of the Memorandum of Agreement which
the Board of Trustees of the School ratified, laid to
rest the controversy on whether the Province of Cebu
may recover all or only some of the lots it had
donated in 1960 to the Cebu (Sudlon) Agricultural
School, now the Cebu State College of Agriculture.
WHEREFORE, finding no reversible error in the
decision of the Court of Appeals, the petition for
review is DENIED for lack of merit.
SO ORDERED.
G.R. NO. 121159 December 16, 2002
VSC COMMERCIAL ENTERPRISES,
INC., petitioner,
vs.
COURT OF APPEALS, OSCAR ESTOPACE and
JOSE SILAPAN, respondents.
DECISION
AUSTRIA-MARTINEZ, J.:
The present petition for review on certiorari brought
before us by VSC Commercial Enterprises, Inc.
(VSC) seeks the reversal of the decision of the Court
of Appeals promulgated on June 16, 1994 reversing
and setting aside the order of dismissal, dated March
15, 1991, of Civil Case No. 90-55411 issued by the
Regional Trial Court of Manila (Branch 21) and the
resolution of the appellate court, dated July 7, 1995,
denying petitioner’s motion for reconsideration.
The facts of the case are as follows:
On December 12, 1990, herein private respondents
Oscar Estopace and Jose Silapan filed with the
Regional Trial Court of Manila a complaint against
the Register of Deeds of Manila and petitioner VSC
alleging:
"3. xxx that they are bona-fide stallholders
inside the ‘PamilihangSentralng Sta. Mesa’,
for about ten (10) years or so prior to the
institution of this action;
"4. As such stallholders, plaintiffs have been
paying their market fees to defendant VSC
Commercial Enterprises, Inc. under the
latter’s claim that he (sic) was the registered
owner of the lot and building known as the
‘PamilihangSentralng Sta. Mesa;’
"5. Of late, the plaintiffs came into
possession of certain documents which
would indicate that TCT No. 153406 of the
Register of Deeds of Manila (which is in the
name of VSC Commercial Enterprises,
Inc.),1originating as it did after several
transfers of titles, from O.C.T. No. 2863
covers lands not in Sta. Mesa, Manila but
lands situated either in Caloocan, Mariquina
Estate or in San Juan, Metro Manila;" 2
In support thereof, private respondents cited several
documents annexed to their complaint showing that
TCT No. 153406 is "fraudulent, spurious and highly
questionable." They pray for the cancellation of
defendant VSC’s title over the subject property
claiming that:
"13. As a consequence of the cancellation of
said title of land, the land thereunder (sic)
remains with or reverts to the estate (sic)
disposable to qualified applicants to buy the
said land in accordance with law;
"14. As stallholders, the plaintiffs together
with the other several stallholders on this
land would have pre-emptive rights over this
government property."3
Instead of filing an Answer, petitioner VSC filed a
Motion to Dismiss on the following grounds:
"PLAINTIFFS ARE NOT THE REAL PARTIES IN
INTEREST. AS SUCH, THEY HAVE NO CAUSE
OF ACTION AGAINST THE HEREIN
DEFENDANT.
"THE COMPLAINT STATES NO CAUSE OF
ACTION CONSIDERING THAT PLAINTIFFS
ARE ESTOPPED FROM ASSERTING TITLE OF
THE PROPERTY LEASED BY THEM FROM THE
HEREIN DEFENDANT.
"AND ASSUMING BUT WITHOUT ADMITTING
THAT PLAINTIFFS ARE THE REAL PARTIES IN
INTEREST AND HAVE CAUSE OF ACTION
AGAINST DEFENDANT, THE CLAIM OR
DEMAND SET FORTH IN THE PLAINTIFFS’
COMPLAINT HAS ALREADY PRESCRIBED OR
OTHERWISE EXTINGUISHED."4
On March 15, 1991, the lower court issued an order
dismissing the complaint.5
Private respondents appealed the said order to the
Court of Appeals.
On June 16, 1994, the appellate court rendered the
assailed decision, the dispositive portion of which
reads:
"ACCORDINGLY, the order of dismissal of Civil
Case No. 90-55411 is hereby REVERSED and SET
ASIDE. The records of the case are ordered
remanded to the Court of origin or the Regional Trial
Court of Manila, Branch 21 for appropriate hearing
and/or for further proceedings. We make no
pronouncement as to costs.
"SO ORDERED."6
Petitioner VSC filed a Motion for Reconsideration
but the appellate court, in a Resolution issued on July
7, 1995, denied the same.7
Hence, herein petition raising the following
Assignment of Errors:
I
THE COURT OF APPEALS COMMITTED
GRAVE ABUSE OF DISCRETION IN ORDERING
THE TRIAL COURT FOR FURTHER
PROCEEDING/TRIAL OF THE RESPONDENTS’
COMPLAINT DESPITE ITS FINDINGS THAT
RESPONDENTS ARE MERE LESSEES OR
TENANTS OF THE PETITIONER’S PROPERTY
COVERED BY TRANSFER CERTIFICATE OF
TITLE NO. 153406 WHICH RESPONDENTS
SEEK TO ANNUL IN THE SAID COMPLAINT. IN
SO DOING, THE COURT OF APPEALS
PATENTLY VIOLATED ARTICLE 1436 OF THE
CIVIL CODE OF THE PHILIPPINES AS WELL AS
SECTION 3(b), RULE 131 OF THE RULES OF
COURT AND OTHER JURISPRUDENCE ON THE
MATTER.
II
THE COURT OF APPEALS COMMITTED
GRAVE ABUSE OF DISCRETION IN
ALLOWING THE RESPONDENTS TO
PROSECUTE THE SAID COMPLAINT DESPITE
THE CLEAR ALLEGATIONS THEREIN THAT
RESPONDENTS ARE NOT THE REAL PARTY IN
INTEREST TO PROSECUTE THE SAME. IN SO
DOING, THE COURT OF APPEALS VIOLATED
SECTION 2, RULE 3 OF THE RULES OF COURT.
III
THE COURT OF APPEALS COMMITTED
GRAVE ABUSE OF DISCRETION IN ORDERING
THE TRIAL COURT TO CONTINUE FURTHER
PROCEEDINGS OF THE SAID RESPONDENTS’
COMPLAINT DESPITE THE PARTIES CLEAR
ADMISSION OF FACTS AND EVIDENCE ON
RECORD THAT THE CAUSE OF ACTION
STATED IN THE SAID COMPLAINT HAS
ALREADY PRESCRIBED. IN SO DOING, THE
COURT OF APPEALS VIOLATED SECTION 32
OF PRES. DECREE NO. 1529 AS WELL AS
SEVERAL JURISPRUDENCE ON THE MATTER.
The petition is impressed with merit.
Private respondents do not directly assert title to the
thing leased as against petitioner. Instead, they
contend that petitioner’s title over the subject
property is void, praying that the same should be
cancelled and the disputed property should be
reverted back to the State.
We agree with the petitioner that private respondents
are barred from questioning the former’s title over
the subject property. In a long line of cases, this
Court has consistently held that the private
respondents, as lessees, who had undisturbed
possession for the entire term under the lease, are
estopped to deny their landlord’s title, or to assert a
better title not only in themselves, but also in some
third person, including the State, while they remain in
possession of the leased premises and until they
surrender possession to the landlord.8 In the present
case, it is undisputed that there exists a lessor-lessee
relationship between petitioner and private
respondents, the latter being among the persons who
lease a portion of the subject property owned by
herein petitioner. Clearly, therefore, private
respondents, as lessees, are estopped from
questioning petitioner’s title, even on the ground that
the subject property properly belongs to the State.
Moreover, we also agree with petitioner that private
respondents are not the real parties in interest.
Under Rule 3, Section 2 of the Revised Rules of
Court, a real party in interest is defined as "the party
who stands to be benefited or injured by the judgment
in the suit, or the party entitled to the avails of the
suit." "Interest" within the meaning of the rule means
material interest, an interest in issue and to be
affected by the decree, as distinguished from mere
interest in the question involved, or a mere incidental
interest.9 The interest of the party must also be
personal and not one based on a desire to vindicate
the constitutional right of some third and unrelated
party.10 Real interest, on the other hand, means a
present substantial interest, as distinguished from a
mere expectancy or a future, contingent, subordinate,
or consequential interest.11
In the case at bar, the private respondents are mere
lessees of the property in question. As such, they
have no present substantial and personal interest with
respect to issues involving ownership of the disputed
property. The only interest they have, in the event WHEREFORE, the petition is GRANTED. The
that petitioner’s title over the subject property is assailed Decision and Resolution of the Court of
cancelled and ownership reverts to the State, is the Appeals, dated June 16, 1994 and July 7, 1995 are
hope that they become qualified buyers of the subject REVERSED and SET ASIDE. The Order of the
parcel of land. Undoubtedly, such interest is a mere Regional Trial Court of Manila (Branch 21) dated
expectancy. Even the private respondents themselves March 15, 1991, dismissing the complaint in Civil
claim that in case of reversion of ownership to the Case No. 90-55411, is REINSTATED.
State, they only have "pre-emptive rights" to buy the Let copy of herein decision be furnished the Office of
subject property;12 that their real interest over the said the Solicitor General for proper information and
property is contingent upon the government’s guidance.
consideration of their application as buyers of the SO ORDERED.
same.13 It is settled that a suit filed by a person who is
not a party in interest must be dismissed.14
It is only the government that has the personality to
bring an action for the cancellation of petitioner’s
title and reversion of ownership of the subject
property to the State. Section 101 of the Public Land
Act categorically declares that only the government
may institute an action to recover ownership of a
public land. The principle enunciated in Sumail vs.
CFI15 is applicable in the resolution of the present
controversy. In the said case, this Court held:
"Under Section 101 above reproduced, only the
Solicitor General or the officer acting in his stead
may bring the action for reversion. Consequently,
Sumail may not bring such action or any action
which would have the effect of canceling a free
patent and the corresponding certificate of title issued
on the basis thereof, with the result that the land
covered thereby will again form part of the public
domain. Furthermore, there is another reason for
withholding legal personality from Sumail. He does
not claim the land to be his private property. x
xxConsequently, even if the parcel were declared
reverted to the public domain, Sumail does not
automatically become owner thereof. He is a mere
public land applicant like others who might apply for
the same."
The same principle was reiterated in Lucas vs.
Durian16 and in Nebrada vs. Heirs of Alivio.17
Considering that private respondents have no valid
cause of action against herein petitioners, the issue on
prescription has perforce been rendered off-tangent
and therefore there is no longer any need to resolve
the same.
G.R. No. L-4935 May 28, 1954
J. M. TUASON & CO., INC., represented by it
Managing PARTNER, GREGORIA ARANETA,
INC., plaintiff-appellee,
vs.
QUIRINO BOLAÑOS, defendant-appellant.
Araneta and Araneta for appellee.
Jose A. Buendia for appellant.
REYES, J.:
This is an action originally brought in the Court of
First Instance of Rizal, Quezon City Branch, to
recover possesion of registered land situated in barrio
Tatalon, Quezon City.
Plaintiff's complaint was amended three times with
respect to the extent and description of the land
sought to be recovered. The original complaint
described the land as a portion of a lot registered in
plaintiff's name under Transfer Certificate of Title
No. 37686 of the land record of Rizal Province and as
containing an area of 13 hectares more or less. But
the complaint was amended by reducing the area of 6
hectares, more or less, after the defendant had
indicated the plaintiff's surveyors the portion of land
claimed and occupied by him. The second
amendment became necessary and was allowed
following the testimony of plaintiff's surveyors that a
portion of the area was embraced in another
certificate of title, which was plaintiff's Transfer
Certificate of Title No. 37677. And still later, in the
course of trial, after defendant's surveyor and witness,
Quirino Feria, had testified that the area occupied and
claimed by defendant was about 13 hectares, as
shown in his Exhibit 1, plaintiff again, with the leave
of court, amended its complaint to make its
allegations conform to the evidence.
Defendant, in his answer, sets up prescription and
title in himself thru "open, continuous, exclusive and
public and notorious possession (of land in dispute)
under claim of ownership, adverse to the entire world
by defendant and his predecessor in interest" from
"time in-memorial". The answer further alleges that
registration of the land in dispute was obtained by
plaintiff or its predecessors in interest thru "fraud or
error and without knowledge (of) or interest either
personal or thru publication to defendant and/or
predecessors in interest." The answer therefore prays
that the complaint be dismissed with costs and
plaintiff required to reconvey the land to defendant or
pay its value.
After trial, the lower court rendered judgment for
plaintiff, declaring defendant to be without any right
to the land in question and ordering him to restore
possession thereof to plaintiff and to pay the latter a
monthly rent of P132.62 from January, 1940, until he
vacates the land, and also to pay the costs.
Appealing directly to this court because of the value
of the property involved, defendant makes the
following assignment or errors:
I. The trial court erred in not dismissing the
case on the ground that the case was not
brought by the real property in interest.
II. The trial court erred in admitting the third
amended complaint.
III. The trial court erred in denying
defendant's motion to strike.
IV. The trial court erred in including in its
decision land not involved in the litigation.
V. The trial court erred in holding that the
land in dispute is covered by transfer
certificates of Title Nos. 37686 and 37677.
Vl. The trial court erred in not finding that
the defendant is the true and lawful owner of
the land.
VII. The trial court erred in finding that the
defendant is liable to pay the plaintiff the
amount of P132.62 monthly from January,
1940, until he vacates the premises.
VIII. The trial court erred in not ordering the
plaintiff to reconvey the land in litigation to
the defendant.
As to the first assigned error, there is nothing to the
contention that the present action is not brought by
the real party in interest, that is, by J. M. Tuason and
Co., Inc. What the Rules of Court require is that an
action be broughtin the name of, but not
necessarily by, the real party in interest. (Section 2,
Rule 2.) In fact the practice is for an attorney-at-law
to bring the action, that is to file the complaint, in the
name of the plaintiff. That practice appears to have
been followed in this case, since the complaint is
signed by the law firm of Araneta and Araneta,
"counsel for plaintiff" and commences with the
statement "comes now plaintiff, through its
undersigned counsel." It is true that the complaint
also states that the plaintiff is "represented herein by
its Managing Partner Gregorio Araneta, Inc.", another
corporation, but there is nothing against one
corporation being represented by another person,
natural or juridical, in a suit in court. The contention
that Gregorio Araneta, Inc. can not act as managing
partner for plaintiff on the theory that it is illegal for
two corporations to enter into a partnership is without
merit, for the true rule is that "though a corporation
has no power to enter into a partnership, it may
nevertheless enter into a joint venture with another
where the nature of that venture is in line with the
business authorized by its charter." (Wyoming-
Indiana Oil Gas Co. vs. Weston, 80 A. L. R., 1043,
citing 2 Fletcher Cyc. of Corp., 1082.) There is
nothing in the record to indicate that the venture in
which plaintiff is represented by Gregorio Araneta,
Inc. as "its managing partner" is not in line with the
corporate business of either of them.
Errors II, III, and IV, referring to the admission of the
third amended complaint, may be answered by mere
reference to section 4 of Rule 17, Rules of Court,
which sanctions such amendment. It reads:
Sec. 4. Amendment to conform to evidence.
— When issues not raised by the pleadings
are tried by express or implied consent of
the parties, they shall be treated in all
respects, as if they had been raised in the
pleadings. Such amendment of the pleadings
as may be necessary to cause them to
conform to the evidence and to raise these
issues may be made upon motion of any
party at my time, even of the trial of these
issues. If evidence is objected to at the trial
on the ground that it is not within the issues
made by the pleadings, the court may allow
the pleadings to be amended and shall be so
freely when the presentation of the merits of
the action will be subserved thereby and the
objecting party fails to satisfy the court that
the admission of such evidence would
prejudice him in maintaining his action or
defense upon the merits. The court may
 grant a continuance to enable the objecting
party to meet such evidence.
Under this provision amendment is not even
necessary for the purpose of rendering judgment on
issues proved though not alleged. Thus, commenting
on the provision, Chief Justice Moran says in this
Rules of Court:
Under this section, American courts have,
under the New Federal Rules of Civil
Procedure, ruled that where the facts shown
entitled plaintiff to relief other than that
asked for, no amendment to the complaint is
necessary, especially where defendant has
himself raised the point on which recovery
is based, and that the appellate court treat
the pleadings as amended to conform to the
evidence, although the pleadings were not
actually amended. (I Moran, Rules of Court,
1952 ed., 389-390.)
Our conclusion therefore is that specification of error
II, III, and IV are without merit..
Let us now pass on the errors V and VI. Admitting,
though his attorney, at the early stage of the trial, that
the land in dispute "is that described or represented in
Exhibit A and in Exhibit B enclosed in red pencil
with the name QuirinoBolaños," defendant later
changed his lawyer and also his theory and tried to
prove that the land in dispute was not covered by
plaintiff's certificate of title. The evidence, however,
is against defendant, for it clearly establishes that
plaintiff is the registered owner of lot No. 4-B-3-C,
situate in barrio Tatalon, Quezon City, with an area
of 5,297,429.3 square meters, more or less, covered
by transfer certificate of title No. 37686 of the land
records of Rizal province, and of lot No. 4-B-4,
situated in the same barrio, having an area of 74,789
square meters, more or less, covered by transfer
certificate of title No. 37677 of the land records of
the same province, both lots having been originally
registered on July 8, 1914 under original certificate of
title No. 735. The identity of the lots was established
by the testimony of Antonio Manahan and Magno
Faustino, witnesses for plaintiff, and the identity of
the portion thereof claimed by defendant was
established by the testimony of his own witness,
Quirico Feria. The combined testimony of these three
witnesses clearly shows that the portion claimed by
defendant is made up of a part of lot 4-B-3-C and
major on portion of lot 4-B-4, and is well within the
area covered by the two transfer certificates of title
already mentioned. This fact also appears admitted in
defendant's answer to the third amended complaint.
As the land in dispute is covered by plaintiff's
Torrens certificate of title and was registered in 1914,
the decree of registration can no longer be impugned
on the ground of fraud, error or lack of notice to
defendant, as more than one year has already elapsed
from the issuance and entry of the decree. Neither
court the decree be collaterally attacked by any
person claiming title to, or interest in, the land prior
to the registration proceedings. (Soroñgon vs.
Makalintal,1 45 Off. Gaz., 3819.) Nor could title to
that land in derogation of that of plaintiff, the
registered owner, be acquired by prescription or
adverse possession. (Section 46, Act No. 496.)
Adverse, notorious and continuous possession under
claim of ownership for the period fixed by law is
ineffective against a Torrens title. (Valiente vs. Judge
of CFI of Tarlac,2 etc., 45 Off. Gaz., Supp. 9, p. 43.)
And it is likewise settled that the right to secure
possession under a decree of registration does not
prescribed. (Francisco vs. Cruz, 43 Off. Gaz., 5105,
5109-5110.) A recent decision of this Court on this
point is that rendered in the case of Jose Alcantara et
al., vs. Mariano et al., 92 Phil., 796. This disposes of
the alleged errors V and VI.
As to error VII, it is claimed that `there was no
evidence to sustain the finding that defendant should
be sentenced to pay plaintiff P132.62 monthly from
January, 1940, until he vacates the premises.' But it
appears from the record that that reasonable
compensation for the use and occupation of the
premises, as stipulated at the hearing was P10 a
month for each hectare and that the area occupied by
defendant was 13.2619 hectares. The total rent to be
paid for the area occupied should therefore be
P132.62 a month. It is appears from the testimony of
J. A. Araneta and witness EmigdioTanjuatco that as
early as 1939 an action of ejectment had already been
filed against defendant. And it cannot be supposed
that defendant has been paying rents, for he has been
asserting all along that the premises in question 'have
always been since time immemorial in open,
continuous, exclusive and public and notorious
possession and under claim of ownership adverse to
the entire world by defendant and his predecessors in
interest.' This assignment of error is thus clearly
without merit.
Error No. VIII is but a consequence of the other
errors alleged and needs for further consideration.
During the pendency of this case in this Court
appellant, thru other counsel, has filed a motion to
dismiss alleging that there is pending before the
Court of First Instance of Rizal another action
between the same parties and for the same cause and
seeking to sustain that allegation with a copy of the
complaint filed in said action. But an examination of
that complaint reveals that appellant's allegation is
not correct, for the pretended identity of parties and
cause of action in the two suits does not appear. That
other case is one for recovery of ownership, while the
present one is for recovery of possession. And while
appellant claims that he is also involved in that order
action because it is a class suit, the complaint does
not show that such is really the case. On the contrary,
it appears that the action seeks relief for each
individual plaintiff and not relief for and on behalf of
others. The motion for dismissal is clearly without
merit.
Wherefore, the judgment appealed from is affirmed,
with costs against the plaintiff.
Paras, C.J., Pablo, Bengzon, Montemayor, Jugo,
Bautista Angelo, Labrador, and Concepcion,
JJ., concur.
G.R. No. L-14242 September 20, 1920
JULIAN REYES, ET AL., plaintiffs-appellant,
vs.
FRANCISCA CORDERO, MARIA CORDERO,
and AMANDO GATMAITAN, defendants-
appellees.
Gabriel N. Trinidad and Fernando Torrillo for
appellants.
Ambrosio Santos for appellee Gatmaitan.
No appearance for the other appellees.
ARAULLO, J.:
The complaint presented in the Court of First
Instance of Bulacan prayed that after trial judgment
be rendered ordering the partition, in accordance with
law, of the land described in paragraph 2 thereof. To
this end the plaintiffs alleged that they and the
defendants Francisca Cordero and Maria Cordero
were the descendants of the owner of said parcel of
land, Leon Alfaro, who died long ago in the
municipality of Paombong, Province of Bulacan; that
upon his death one of his daughter, Felipa Alfaro,
now deceased, mother of the defendants Francisca
and Maria Cordero, succeeded him in the possession
thereof; and that said land was still undivided
property of the heirs. It was also alleged in paragraph
6 of the complaint that the other defendant,
AmandoGatmaitan, was made a party because he was
in possession of said land, claiming a supposed
interest adverse to that to the plaintiffs.
To the complaint a demurrer was presented by the
defendant AmandoGatmaitan on the grounds of
misjoinder of parties in that he was made a party
defendant and that the facts alleged did not constitute
a cause of action as to him. After hearing, the court,
by order of February 9, 1918, sustained the demurrer,
to which order the plaintiff excepted. The plaintiffs
not having amended their complaint within the time
fixed by the rules of court, the court dismissed the
case as to said defendant, AmandoGatmaitan, to
which action of the lower court the plaintiffs also
excepted and brought the case to this court on appeal
by bill of exceptions.
The question presented in this proceeding is whether
the defendant AmandoGatmaitan, who is neither a
descendant of the deceased Leon Alfaro, nor a coheir
or coowner of the plaintiffs and the other two
defendant, as to the land described in the complaint,
may be made a party to the suit for partition instituted
by the plaintiffs, or, in other words, whether his
joinder as a party defendant was proper.
An action for partition of real property, as the name
itself clearly suggests, is a judicial controversy
between persons, who, being coowners or
coparceners thereof, seek to secure a division or
partition among them of the common property,
giving to each one the part corresponding to him.
The right to bring such action or to ask at any time
for the division of the common property belongs
solely to a coowner or coparcener (art. 400, Civil
Code, and section 181, Code of Civil Procedure). The
action for partition of real property cannot therefore
be instituted except by the coowners or coparceners
of said property, and cannot be maintained against
persons who are not such, because in an action for
partition of such property it is an indispensable
requisite that there should be common ownership of
the thing and that the parties, plaintiffs and
defendants, should be coowners of coparceners.
NATURE AND OBJECTS OF
PARTITION. — The object of partition
proceedings is to enable those who own
property as joint tenants, or coparceners or
tenants in common, to put an end to the
tenancy so as to vest in each a sole estate in
specific property or an allotment of the lands
or tenements. . . . (Ruling Case Law, vol. 20,
p. 716, paragraph 2.)
. . . It is generally held that it is a
prerequisite to the maintenance of a
proceeding for the compulsory partition of
lands that the petitioner have, at the
commencement of such proceeding, an
actual or constructive possession, in
common with the defendants, of the land
sought to be partitioned. . . . (Id., p. 730,
paragraph 13.)
This court has laid down the doctrine in several
cases, among them, that of Rodriguez vs. Ravilan (17
Phil., 63), that:
In an action for the partition of property held
in common, it is assumed that the parties by
whom it is prosecuted are all coowners or
coproprietors of the property to be divided,
as he who claims or demands the partition of
property of common ownership must
necessarily have the status of coproprietor of
the undivided property.
In such an action for partition the question
of common ownership is not to be argued,
nor the fact as to whether the interested
parties are or are not the owners of the
property in question, but only as to how, and
in what manner, and in what proportion the
said property of common ownership shall be
distributed among the interested parties by
order of the court.
The appellants admit in their brief that it is not
alleged in the complaint that the defendant
AmandoGatmaitan is made a party for the reason that
he is owner or possessor of the property in that
capacity; and they state that, as it has been alleged
therein that he is possession of the land and claims a
supposed interest opposed to that of the plaintiff,
these facts are matters of proof, the burden of which
is upon the plaintiffs. This is just the error committed
by the plaintiffs. Had it been alleged that the
possession of the defendant was in the capacity of
coowner with the plaintiffs or that his interest
opposed to that of the latter consists in his having
been subrogated by assignment, sale, or other mode
of transferring ownership, to the proprietary right
which any of the other defendants had in the property
in question, then the joinder of the defendant
Gatmaitan as such would have been proper, inasmuch
as every coowner has the absolute right to his part
and consequently may alienate, assign, or mortgage it
and even substitute another in its enjoyment, the
effect of the alienation being of course limited to the
part which may be adjudicated to him upon the
division of the thing in common (art. 399, Civ.
Code). Said defendant, as coowner and coparcener,
as to a part of the property, would have the right to be
a party to the partition proceeding, and, in such case,
if he is not joined as defendant, he could intervene.
This is the reason why it is provided in section 183 of
the Code of Civil Procedure that the complaint in
partition proceedings should, besides stating the
nature of the title of the plaintiff and describing the
real property sought to be partitioned, also name as
defendant every tenant in common, coheir or other
person interested in said property. But he could by no
means be joined in the complaint as defendant, with
the right to prove his common ownership with the
plaintiffs and the other two defendants or his
corresponding right to the property, because this
would amount to converting the partition proceeding
into another proceeding for ejectment or unlawful
entry against said defendant; and it would serve as a
means by which the plaintiffs could investigate the
right or interest which the defendant Gatmaitan claim
to possess in the property which is the subject-matter
of the complaint for partition.
One who holds property in common and pro
indiviso with others has a perfect right to
have a division made of the same. No
hindrance to the exercise and effectiveness
of this right can lie in any conveyances
made of various portion of the property by
some of the cotenants thereof in favor of
other persons, for the law, besides granting
these latter the right to a voice in the
division of the thing owned in common and
to object to any division made without their
concurrence, considers them, in an action for
the partition of real estate, as subrogated to
the rights of the vendors in the portion of the
property in their possession. (Arts. 399, 400,
403, and 1051, Civil Code; sec. 762, Code
of Civil Procedure.) (Dancel vs. Dancel, 29
Phil., 25.)
. . . It has been held that under a statute
providing that during the pendency of any
partition suit any person claiming to be
interested in the premises may appear and
assert his right, the right to intervene is
given to all persons claiming an interest in
the land, whether under the common title
sought to be partitioned or by title
independent thereof. But even under statutes
allowing the adjudication of the rights and
interests of the parties to a bona fide
partition suit, an action for partition cannot
be used as a substitute for the action of
ejectment nor for the sole purpose of testing
a legal title. (Ruling Case Law, vol. 20, p. bring an action to recover it for the benefit of all."
730, paragraph 12.) This once more shows that a person cannot be joined
Neither would the doctrine laid down by this court as defendant, who does not a possess the property as
in Araullo vs. Araullo (3 Phil., 567), relied upon by coowner or joint owner, but by virtue of a title the
the plaintiff, justify the joinder of AmandoGatmaitan nature of which is unknown but opposed to those
as defendant, in view of the allegations of the seeking partition thereof as coowners, or who
complaint as to him. In that case, the property sought possesses the same under a claim of interest opposed
to be partitioned was in the actual possession of a to the latter. A person who like the defendant,
third persons who enjoyed possession as owners AmandoGatmaitan, is in this situation, may be sued
without being joined as parties to the proceeding, that in another proceeding, but not in a proceeding for
is they claimed to be owners of the property by virtue partition.
of a title opposed to that both the plaintiff and the The demurrer filed by said defendant to the
defendants, and the commissioners who were to complaint was therefore correctly sustained and the
effect the partition had already been appointed by the plaintiffs not having amended it within the time fixed
court. This court declared that the proceedings could by the rules of court, the dismissal thereof as to said
not be continued because the commissioners defendant was proper.
appointed to effect the partition had no right, for the The order appealed from is therefore affirmed, with
purpose of taking a view as required by law, to enter costs. So ordered.
lands possessed by third persons as owners, who
were not made parties in the partition proceeding; but
the following is stated in the body of the decision:
"Whether the persons should be made parties to the
partition suit and their claims there determined, or
whether an independent action must be brought
against them, we do not decide." Therefore this court
did not hold in that case, as appellants seem to have
understood that in a complaint for partition of
property in order that the proceedings might be
continued those persons should be joined as
defendants who, being in possession of the property
or part thereof, alleged themselves to be the owners
thereof by virtue of a title opposed to that of the
parties to the proceeding, or claim an interest adverse
also to theirs; on the contrary the court abstained
from deciding it, and did not determine whether they
should be included as parties in the same proceeding
or whether a new and independent action should be
instituted against them.
Nevertheless it is indisputable that when the property
which is yet undivided among various coowners has
been usurped or is in the possession of a third person
who claims a title opposed to that of the former, the
common owners thereof may recover it in a proper
proceeding, for, as the supreme court of Spain has
held in its decision of April 6, 1896 (79 Jur. Civ.,
641), "Any coowner of an undivided property may
G.R. No. 94005. April 6, 1993.
LUISA LYON NUÑAL, herein represented by
ALBERT NUÑAL, and ANITA NUÑAL
HORMIGOS, petitioners,
vs.
THE COURT OF APPEALS and EMMA LYON DE
LEON in her behalf and as guardian ad litem of the
minors HELEN SABARRE and KENNY
SABARRE, EDUARDO GUZMAN, MERCEDEZ
LYON TAUPAN, WILFREDO GUZMAN, MALLY
LYON ENCARNACION and DORA LYON DELAS
PEÑAS, respondents.
SYLLABUS
1. REMEDIAL LAW; CIVIL PROCEDURE;
JUDGMENT; ONCE IT BECOMES FINAL, MAY
NO LONGER BE MODIFIED IN ANY RESPECT;
EXCEPTIONS. — In the case of Manning
International Corporation v. NLRC, (195 SCRA 155,
161 [1991]) We held that ". . ., nothing is more
settled in the law than that when a final judgment
becomes executory, it thereby becomes immutable
and unalterable. The judgment may no longer be
modified in any respect, even if the modification is
meant to correct what is perceived to be an erroneous
conclusion of fact or law, and regardless of whether
the modification is attempted to be made by the Court
rendering it or by the highest Court of land. The only
recognized exceptions are the correction of clerical
errors or the making of so-called nunc pro tunc
entries which cause no prejudice to any party, and, of
course, where the judgment is void." Furthermore,
"(a)ny amendment or alteration which substantially
affects a final and executory judgment is null and
void for lack of jurisdiction, including the entire
proceedings held for that purpose."
2. ID.; ID.; ID.; ID.; REMEDY OF AGGRIEVED
PARTY. — In the case at bar, the decision of the trial
court in Civil Case No. 872 has become final and
executory. Thus, upon its finality, the trial judge lost
his jurisdiction over the case. Consequently, any
modification that he would make, as in this case, the
inclusion of Mary Lyon Martin would be in excess of
his authority. The remedy of Mary Lyon Martin is to
file an independent suit against the parties in Civil
Case No. 872 and all other heirs for her share in the
subject property, in order that all the parties in
interest can prove their respective claims.
DECISION
CAMPOS, JR., J p:
This is a petition for review on certiorari of the
decision ** dated February 22, 1990 of the Court of
Appeals in CA-G.R. CV No. 14889 entitled "Emma
Lyon de Leon, et al., plaintiffs-appellees versus Luisa
Lyon Nuñal, now deceased herein represented by
Albert Nuñal, et al., defendants appellants,"
dismissing petitioners' appeal and affirming the trial
court's order *** dated January 9, 1987 for the
inclusion of Mary Lyon Martin as one of the heirs
who shall benefit from the partition.
The facts as culled from the records of the case are as
follows.
This case originated from a suit docketed as Civil
Case No. 872 filed by Emma Lyon de Leon in her
behalf and as guardian ad litem of the minors Helen
Sabarre and Kenny Sabarre, Eduardo Guzman,
Mercedes Lyon Taupan, Wilfredo Guzman, Mally
Lyon Encarnacion and Dona Lyon de lasPeñas,
(herein private respondents) against Luisa Lyon
Nuñal, now deceased and herein represented by her
heirs, Albert Nuñal and Anita NuñalHormigos
(herein petitioners), for partition and accounting of a
parcel of land located in Isabela, Basilan City.
Subject parcel of land was formerly owned by Frank
C. Lyon and May Ekstrom Lyon, deceased parents of
Helen, Dona, Luisa, Mary, Frank and William James.
Private respondents claimed that said parcel of land,
formerly covered by Transfer Certificate of Title No.
3141 in the name of Frank C. Lyon, has been in
possession of petitioner Luisa Lyon Nuñal since 1946
and that she made no accounting of the income
derived therefrom, despite demands made by private
respondents for the partition and delivery of their
shares.
On December 17, 1974, after trial and hearing, the
then Court of First Instance (now Regional Trial
court) rendered its judgment in favor of private
respondents and ordered the partition of the property
but dismissing private respondents' complaint for
accounting. The dispositive portion of the judgment
reads as follows:
"WHEREFORE, judgment is hereby rendered
ordering the partition of the land covered by Transfer
Certificate of Title No. 3141 among the plaintiffs and
defendant. The parties shall make partition among
themselves by proper instruments of conveyance,
subject to the Court's confirmation, should the parties
be unable to agree on the partition, the court shall
appoint commissioners to make the partition,
commanding them to set off to such party in interest
such part and proportion of the property as the Court
shall direct. Defendant is further ordered to pay
plaintiffs attorney's fees in the sum of P2,000.00." 1
On July 30, 1982, the order of partition was affirmed
in toto by the Court of Appeals in CA-G.R. No.
57265-R. The case was remanded to the court of
origin for the ordered partition. 2
On May 17, 1984, an order for the issuance of the
writ of execution was issued by the court a quo. 3
On July 17, 1984, Mary Lyon Martin, daughter of the
late Frank C. Lyon and Mary Ekstrom Lyon, assisted
by her counsel filed a motion to quash the order of
execution with preliminary injunction. In her motion,
she contends that not being a party to the above-
entitled case her rights, interests, ownership and
participation over the land should not be affected by a
judgment in the said case; that the order of execution
is unenforceable insofar as her share, right,
ownership and participation is concerned, said share
not having been brought within the Jurisdiction of the
court a quo. She further invokes Section 12, Rule 69
of the Rules of Court. 4
On June 26, 1985, the trial court issued an order
revoking the appointment of the three commissioners
and in lieu thereof, ordered the issuance of a writ of
execution. 5
On February 4, 1986, the said court issued an order
appointing a Board of Commissioners to effect the
partition of the contested property. 6
On May 28, 1986, the trial court dismissed the
motion to quash order of execution with preliminary
injunction filed by Mary Lyon Martin and directed
the partition of the property among the original party
plaintiffs and defendants. 7
On September 24, 1986, the Commissioners
manifested to the trial court that in view of the fact
that the name of Mary Lyon Martin also appears in
the Transfer Certificate of Title, she could therefore
be construed as one of the heirs. A ruling from the
trial court was then sought. 8
On September 29, 1986, the lower court issued an
order directing the counsel of Emma Lyon de Leon to
furnish the court within five days from receipt thereof
all the names the of heirs entitled to share in the
partition of the subject property. 9
On October 1, 1986, the petitioners filed a
manifestation praying that the court issue an order
directing the partition of the property in consonance
the decision dated December 17, 1974 of the trial
court the order of said court dated May 28, 1986. 10
Without ruling on the manifestation, the lower court
issued an order directing the Board of Commissioners
to immediately partition the said property. 11
On January 3, 1987, the private respondents filed
motion for clarification as to whether the partition of
property is to be confined merely among the party
plaintiffs and defendants, to the exclusion of Mary
Lyon Martin. 12
On January 9, 1987, the lower court issued the
assailed order directing the inclusion of Mary Lyon
Martin as co-owner with a share in the partition of
the property, to wit:
"After a perusal of the decision of the Court of
Appeals CA-G.R. No. 57265-R, where this case was
appealed by the unsatisfied parties, there is a finding
that Mary now Mary Lyon Martin is one of the
legitimate children of Frank C. Lyon and Mary
Ekstrom. (Page 3 of the decision).
In view of this finding, it would be unfair and unjust
if she would be left out in the partition of this
property now undertaking (sic) by the said court
appointed commissioners.
WHEREFORE, premises considered, the court
appointed commissioners is hereby directed to
include Mary Lyon Martin as co-owner in the said
property subject of partition with the corresponding
shares adjudicated to her.
SO ORDERED." 13
Petitioners' motion for reconsideration 14 of the
aforesaid order was denied by the trial court. 15
On February 22, 1990 the Court of Appeals rendered
its decision dismissing petitioners' appeal, the
dispositive portion of which reads as follows:
"WHEREFORE, premises considered, there being no
legal impediment to the inclusion of Mary Lyon
Martin by the court-appointed Board of
Commissioners as one of the heirs who shall benefit
from the partition, the instant appeal is DISMISSED
for lack of merit.
NO COSTS.
SO ORDERED." 16
Petitioners' motion for reconsideration was denied on
June 6, 1990. 17
Petitioners filed this petition for review alleging that
the Court of Appeals has decided questions of
substance contrary to law and the applicable
decisions of this Court, for the following reasons:
"1.) BY SUSTAINING THE ORDER OF THE
REGIONAL TRIAL COURT DIRECTING THE
COURT APPOINTED BOARD OF
COMMISSIONERS TO INCLUDE MARY L.
MARTIN TO SHARE IN THE PARTITION OF
THE PROPERTY IN LITIGATION DESPITE THE
FACT, OVER WHICH THERE IS NO DISPUTE,
THAT SHE HAS NOT LITIGATED EITHER AS A
PARTY PLAINTIFF OR DEFENDANT IN CIVIL
CASE NO. 872, IT HAS REFUSED TO
RECOGNIZE THAT THE REGIONAL TRIAL
COURT HAS NO JURISDICTION TO AMEND OR
MODIFY THE JUDGMENT IN CIVIL CASE NO.
872 AND THE REGIONAL TRIAL COURT'S
ORDER DATED 28 MAY 1986 WHICH HAS
BECOME FINAL AND EXECUTORY.
2.) WHEN THE COURT OF APPEALS HAS
CATEGORICALLY STATED THAT MARY L.
MARTIN "NEVER LITIGATED AS ONE OF THE
PLAINTIFFS IN SAID CASE," AND HER ONLY
PARTICIPATION THEREIN WAS SIMPLY
CONFINED "AS A WITNESS FOR DEFENDANT-
SISTER LUISA LY ON NUÑAL," AND TO
ALLOW HER TO SHARE IN THE PARTITION
THIS LATE WITHOUT REQUIRING A
PROCEEDING WHERE THE PARTIES COULD
PROVE THEIR RESPECTIVE CLAIMS, IS
TANTAMOUNT TO DENYING THE NUÑALS OF
THEIR RIGHT TO DUE PROCESS. 18
The crux of this case is whether of not the trial court
may order the inclusion of Mary L. Martin as co-heir
entitled to participate in the partition of the property
considering that she was neither a party plaintiff nor a
party defendant in Civil Case No. 872 for partition
and accounting of the aforesaid property and that the
decision rendered in said case has long become final
and executory.
Petitioners contend that the trial court's decision
dated December 14, 1974 in Civil Case No. 872
ordering the partition of the parcel of land covered by
Transfer Certificate of Title No. 3141 among
plaintiffs and defendants has long become final and
executory. Hence the trial court has no jurisdiction to
issue the questioned Order dated January 9, 1987
ordering the Board of Commissioners to include
Mary Lyon Martin to share in the partition of said
property despite the fact that she was not a party to
the said case. Said Order, therefore, resulted in an
amendment or modification of its decision rendered
in Civil Case No. 872.
We find merit in the instant petition.
In the ease of Manning International Corporation v.
NLRC, 19 We held that ". . ., nothing is more settled
in the law than that when a final judgment becomes
executory, it thereby becomes immutable and
unalterable. The judgment may no longer be
modified in any respect, even if the modification is
meant to correct what is perceived to be an erroneous
conclusion of fact or law, and regardless of whether
the modification is attempted to be made by the Court
rendering it or by the highest Court of land. The only
recognized exceptions are the correction of clerical
errors or the making of so-called nunc pro tunc
entries which cause no prejudice to any party, and, of
course, where the judgment is void."
Furthermore, "(a)ny amendment. or alteration which
substantially affects a final and executory judgment is
null and void for lack of jurisdiction, including the
entire proceedings held for that purpose." 20
In the case at bar, the decision of the trial court in
Civil Case No. 872 has become final and executory.
Thus, upon its finality, the trial judge lost his
jurisdiction over the case. Consequently, any
modification that he would make, as in this case, the
inclusion of Mary Lyon Martin would be in excess of
his authority.
The remedy of Mary Lyon Martin is to file an
independent suit against the parties in Civil Case No.
872 and all other heirs for her share in the subject
property, in order that all the parties in interest can
prove their respective claims.
WHEREFORE, the petition is GRANTED. The
Order dated January 9, 1987 of the trial Court as
affirmed by the Court of Appeals is hereby
REVERSED and SET ASIDE. The decision of the
trial court dated December 17, 1974 in Civil Case
No. 872 is hereby REINSTATED.
SO ORDERED.

G.R. No. L-47494 May 15, 1978
AIDA ROBLES, Accompanied by her husband
Rafael Penolio, petitioners,
vs.
COURT OF APPEALS,* ANICETO B.
PARREÑO, and THE REGISTER OF DEEDS
OF NEGROS OCCIDENTAL,respondents.
Ramon C. Ditching & Rolando C. Medalla for
petitioners.
Arsenio Acuña & Associates for respondents.
TEEHANKEE, J.:
The Court sets aside respondent court's decision
which would require petitioner to implead certain
parties and remands account appeal for determination
on its merits. The vendors-co-heirs of petitioner are
not indispensable parties in account action brought by
her for cancellation of account vendee's titles insofar
as they were issued for account whole of account
properties sold to account exclusion of petitioner's
share notwithstanding that she was not a party to
account sale and for redemption as a co-heir of
account properties thus sold to respondent vendee
under Article 1088 of account Civil Code.
As found by account Court of Appeals, petitioner
Aida Robles is account granddaughter of account
deceased Eligio A. Robles (being account child of
Eligio's deceased son Jose). In his lifetime, Eulogio
registered his title to Lot No. 1304 with an area of
4.2038 hectares of account Escalante Cadastre and
account certificate of title thereto was issued in his
name and that of his wife Melania Cuaycong. Eligio
had also started registration proceedings for another
lot, No. 1305-A with an area of 5.8685 hectares and
after his death, title thereto was issued in account
name of his surviving spouse and in account name of
"the heirs of Eulogio Robles". These two properties
pertaining to account conjugal estate of Eligio and
Melamia constitute account disputed properties at
bar.
On June 20, 1957, Melania as surviving spouse and
nine other children besides Eva Robles, another
granddaughter of account deceased Eulogio (sister of
petitioner Aida), who were account deceased heirs to
account extent of 43/44 executed a general Power of
attorney in favor of Francisco (a son) to alienate and
encumber account disputed properties, reciting
therein that account signatories are account owners of
account properties, although they were not joined by
petitioner Aida who is also an heir of account
deceased's estate to account extent of 1/44.
In October, 1960, Francisco by virtue of account
power of attorney executed a private deed of sale of
account properties in favor of respondent Aniceto B.
Parreno and later executed on January 20, 1965 a
notarized deed of sale of account properties in favor
of said respondent for account price of p4.300.00.
The power of attorney was registered in account
office of account respondent Register of Deeds of
Negros Occidental and was apparently treated as a
Declaration of Heirship and thereafter new transfer
titles to account whole of d properties were issued in
favor of account vendee Parreño.
On September 18, 1967, petitioner Aida Robles as
plaintiff filed a complaint in account Negros
Occidental court Of first instance against respondents
Parreño and Register of Deeds praying for
cancellation of account titles issued in respondent
Parreño's name and that she be allowed as a 1/44 co-
heir and co-owner of account properties to redeem
account same from said respon. dent vendee.
The lower court dismissed account complaint and on
appeal respondent c held that account sellers (the
other co-heirs) were indispensable parties and should
have been impleaded and rendered its decision that
"the judgment of account LOWER COURT is hereby
set aside and let this case be, as it is, hereby ordered
remanded to account LOWER COURT so that
plaintiff can be required to implead account
indispensable and necessary parties in account case
and for subsequent hearing for account issuance of a
new judgment."
Respondent appellate court held that "(T)here is a
procedural error in account CASE BELOW. Since
plaintiff was suing defendant for cancellation of his
ownership of account DISPUTED PROPERTY sold
to him by account SELLERS. account latter were
indispensable parties and should have been
impleaded. They had a right to justify account
legality of their sale of account DISPUTED
PROPERTY to defendant in order to free themselves
from damages in favor of defendant if account sale
should be adjudged invalid. Moreover, they should be
given account chance to justify account sale if only to
avoid possible criminal responsibility for estafa on
false allegation of ownership (Art. 315, 2[a], Revised
Penal Code)," and added that "The general rule is that
if an indispensable party is not impleaded, account
case should be dismissed ... Rather than affirm
account decision dismissing plaintiff's complaint,
which will not definitely settle account con
controversy between account plaintiff and account
other parties, this case should be remanded to the
LOWER COURT ...
Petitioner's motion for reconsideration stressing that
her act is one for legal redemption against respondent
as vendee against whom precisely account right of
redemption is exercised) was denied by respondent
court which ruled that the SELLERS would not be
indispensable parties if what they had sold to
defendant was only their respective participations in
account DISPUTED PROPERTY. But what was sold
was account entirety of account DISPUTED
PROPERTY, with account SELLERS claiming full
ownership over account same. The SELLERS took
account position that plaintiff was not a co-owner of
account DISPUTED PROPERTY. As a matter of
fact, in account 'NOTICE OF DECLARATION OF
HEIRSHIP', account SELLERS excluded plaintiff as
an heir of ELIGIO and therefore not a co-owner of
account DISPUTED PROPERTY. If plaintiff is held
entitled to redeem and account redemption is held
binding on account SELLERS, defendant will have
causes of action, civil and criminal against account
SELLERS for having sold to him. as all account
owners thereof, account entirety of account
DISPUTED PROPERTY. Without account
SELLERS being made parties in account CASE
BELOW, account redemption should not be
allowed."
Hence, this petition which asserts that petitioner's co-
heirs who sold account properties to respondent
Parreno are not indispensable parties but that her suit
could be completely adjudicated without them, much
more so with regard to her action as co-heir for legal
redemption of account properties from said
respondent-vendee under Article 1088 of account
Civil Code.
We find merit in the petition.
Petitioner's action for cancellation of titles was in
reality not one "for cancellation of (respondent's)
ownership of account disputed property sold to him
by account sellers" as perceived by respondent court
but rather one questioning account validity of
respondent Register of Deeds' issuing account titles
to account whole of account properties in disregard
of petitioner's 1/44 share therein and against existing
laws and regulations. As stated in account
petition, 1 respondent Register of Deeds was
impleaded "because, by his obvious negligence or act
of indiscretion, he unduly accommodated respondent
Parreno to cure a legal defect or legal deficiency of
account documents covering account sale, via a
short-cut method, by allowing account General
Power of Attorney to be registered as a 'Declaration
of Heirship' (which, in effect. left out account
petitioner and transferred ownership of account
disputed property in 'totality' to respondent Parreno
instead of requiring account presentation of a
separate and true 'Declaration of Heirship' executed
by all account heirs. This requirement is all account
more necessary, if it is noted that account General
Power of Attorney presented was no longer account
original copy, but only a certified true copy from
account Notary Public, and was executed by account
vendor co- heirs on June 20, 1957, or nearly eight (8)
years prior to account date of its registration on
February 23, 1965. Furthermore, account Register of
Deeds did not require account presentation of a
'written notice to all possible redemptioners'. All
these faults, which fag squarely on account shoulders
of respondents Parreno and account Register of
Deeds resulted in account irregular issuance of titles
which are now sought to be cancelled"
The vendors-co-heirs of petitioner are not
indispensable parties insofar as this phase of account
action against account Register of Deeds is
concerned. The fact cited by respondent court that
they have a right to justify account legality of their
sale to respondent to avoid being held liable for
damages or possible criminal responsibility if
account sale should be adjudged invalid does not
make them indispensable parties without whom
petitioner's action cannot be completely adjudicated.
Respondent Parreno could have called them as
witnesses on his behalf or impleaded them as third-
parties defendants in a third-party complaint to justify
account sale of account properties or else answer to
him by was of damages (but it is too late now for
such a third-party complaint); at any rate, said
respondent still has account right of finding a
separate action against account vendors-co-heirs by
way of enforcing account warranty made by them as
vendors of account properties.
The imprecision of petitioner's complaint has caused
some confusion. But it appears evident that account
action for cancellation of titles impleading account
Register of Deeds is one assailing this acts as
wrongful and without authority in law, but that
petitioner "action for cancellation file issued in favor
of respondent Parreno pertains only to her own rights
and in one's and interest and does not affect the true
rights and interests of the vendors-co-heirs. Against
respondent Parreno the action instituted is based on
account premise that he did not acquire all the rights
and interests on account property, subject of sale. His
acquisition is limited only to account rights and
interests of account vendors-co-heirs who signed
account General Power of Attorney and does not
include account rights and interests of a co-heir,
herein petitioner, Aida Robles, who did not sign," as
is clearly in account petition. 2
Such action for cancellation is really secondary and is
but a means of enforcing petitioner's claim as a co-
heir and undivided co-owner of 1/44 of account
properties as a granddaughter of account decreased
Eulogio Robles, which has been found as a fact by
respondent court a well as by account trial court
which held that 'The court accepts as a sufficiently
established fact that plaintiff being account daughter
of Jose Robles and therefore one of account
granddaughters of Eulogio Robles, is one among
account latter's heirs, in account same manner as
plaintiff's sister, Eva Robles. The court also takes
note that plaintiff was not a signatory to account
general power of attorney, Exh. 'A' pursuant to which
conveyance to account defendant of said lots were
made by Francisco Robles. 3
Petitioner's principal action is really therefore one for
legal redemption under Article 1088 of account Civil
Code. 4Insofar as account exercise of such right of
redemption is concerned, petitioner as a co-heir and
respondent Parreno as account buyer are account only
indispensable parties to account exclusion of account
seners-coheirs This was expressly so ruled by
account Court in Castillo vs. Samonte, 5 where we
held that "the trial court had no obligation to order
account inclusion of account vendor either as a party
plaintiff or party defendant in account case, because
while he may be a necessary party, still he is not
indispensable in account sense that account matter
before it could not be completely adjudicated without
him. The deed of sale in favor of appellant clearly
states that what is being sold is an undivided 1/5
portion of account land jointly owned by account
vendor and his brothers and nephew, The vendee-
appellant is, therefore, conclusively presumed to
know account law that under such circumstances,
account co- heirs are entitled to redeem account
portion being sold within 30 days from notice in
writing of account sale, under Article 1088 of
account New civil Code. In effect, he is a vendee
with notice of account right of redemption by account
vendor's co-heirs," and that "moreover, if vendee-
appellant believed he had a claim against account
vendor by reason of account warranty, it was his duty
to have filed a third-party complaint against account
latter ...
Respondent court should therefore have adjudged
account appeal on its merits, and if account facts be
as they are indicated in its decision, to wit, account
petitioner is indeed a co-heir and co-owner of 1/44 of
account properties and that her co-owners-coheirs
had sold account same or their hereditary rights
thereto without notice to her, petitioner's action for
redemption of account properties must be sustained.
ACCORDINGLY, account judgment of respondent
court is hereby set aside and account case- is
remanded to it for determination of account merits of
account appeal in consonance with account Court's
observations in this decision. No costs.
G.R. No. L-9782 April 26, 1957
HILARION CORTEZ, plaintiff-appellant,
vs.
JUAN AVILA, defendant-appellee.
Amado D. Aquino, Jose D. Bacolor and Godofredo
Aquino, Jr., for appellant.
Meliton Pajarillaga for appellee.
CONCEPCION, J.:
This is an appeal, taken by plaintiff Hilarion Cortez,
from an order granting a motion to dismiss of
defendant, Juan Avila, and dismissing the former's
complaint, without pronouncement as to costs.
Plaintiff, Hilarion Cortez, alleges in said complaint
that since 1935, he has continuously, publicly and
adversely occupied a parcel of land, of about sixteen
(16) hectares, situated in the Barrio of Conversion,
Municipality of Pantabangan, Province of Nueva
Ecija, more particularly described in said pleading,
and included within the land "described in the
Original Certificate of Title No. P-1318 in the name
(now) of Juan Avila, the herein defendant; that in
November, 1946, Cortez applied for a homestead
patent on said 16-hectare lot, the same being a public
land; that his homestead application was duly
approved by the Director of Lands, on June 25, 1947;
that, having complied with all the conditions essential
to the issuance of a patent, he filed his final proof
thereon in May, 1952; that; as a result, the issuance
of a homestead patent in his favor was recommended
by the investigating public lands inspector as well as
by the District Land Officer of Nueva Ecija, in an
indorsement to the Director of Lands, dated June 6,
1952; that for reasons unknown to plaintiff, said
homestead patent has not been issued to him,
although he has already become the "equitable
owner" of the lot aforementioned; that defendant
Avila had filed a free patent application for the same
lot, knowing that it had been in continuous and actual
possession of the plaintiff since 1935, and despite his
(Avila's) knowledge, actual or presumed, of the
submission of plaintiff's aforementioned final proof;
that through threat, intimidation and force, Avila
succeeded in occupying said lot, in or about June,
1953, to the exclusion of the plaintiff; that on
October 15, 1954, Avila secured a free patent on said
lot, by alleging falsely, in his free patent application,
that he and his predecessors in interest were in
possession of said lot, continuously, since July 4,
1925, and by misrepresenting to the "table" public
lands inspector who allegedly made the investigation
relative to said free patent application of Avila, that
he had complied with the legal requirements
therefore; that less than a year has elapsed, since the
issuance of said original certificate of title in favor of
Avila; and that, in consequence of the
aforementioned acts of Avila, plaintiff has suffered
damages amounting to P6,400 a year, apart from the
sum of P5,000 by way of attorney's fees. Plaintiff
prays the Court to:
1. Order the cancellation of the free patent
of the defendant and the Certificate of Title
issued to him and to register the same in the
name of the plaintiff;
2. Restore possession of the premises to the
herein plaintiff;
3. Order defendant to pay the plaintiff the
amount of P6400 for each year that he is in
possession until it is returned to plaintiff,
and further, to order defendant to pay the
amount of P5000.00 as attorneys' fees;
4. Issue such order and remedies as may be
equitable in the premises.
As above stated, Avila filed a motion to dismiss
alleging that plaintiff has no legal capacity to sue,
because the land in dispute is part of the public
domain, and, hence, an action to recover the same
may be instituted exclusively by the Government,
through the Solicitor-General. Appellant now
maintains that the lower court erred in granting said
motion, upon the ground that, having complied with
the conditions essential to be entitled to a patent, he is
the equitable owner of the lot, in question, and that
the Government could not have maintained the
present action, the same being for the benefit of the
plaintiff, in his private capacity.
Obviously, plaintiff herein has "legal capacity" to
sue, which is independent of the public or private
character of the lot in controversy. This does not
mean, however, that he has a cause of action, or that
his appeal should prosper.
To begin with, an indispensable party is lacking. The
complaint is predicated upon the major premise that
plaintiff is the equitable owner of said lot, for he has
fully satisfied the prerequisites to the issuance of a
homestead patent in his favor. This pretense implies
that said lot was a public land; that the legal, as well
as the equitable, title thereto used to be in the State;
and that, although still its legal owner, the State has
already been divested of its equitabletitle, and
plaintiff has acquired it, he having fulfilled all the
conditions essential for the issuance of a patent in his
name. Thus, the issue raised cannot be determined
without affecting the interest of the State, which is
not a party in this proceeding, and, hence, cannot
protect and defend therein such interest.
Ordinarily, when a complaint is defective by reason
of failure to include an indispensable party,
reasonable opportunity to amend said pleading must
be given, and the action should not be dismissed,
except when plaintiff fails or refuses to include said
party, or the latter cannot be sued. In the case at bar,
such policy need not be followed, for plaintiff has not
exhausted the administrative remedies available to
him. Indeed, he seeks, in effect a review of the
decision of the Director of Lands in causing a patent
to be issued to defendant Avila. Yet, plaintiff does
not appear to have asked the Director of Lands to
reconsider said decision, or to have appealed
therefrom to the Secretary of Agriculture and Natural
Resources, who controls said official and is the
"officer charged with carrying out the provisions" of
our revised public land law (C. A. 141, sec. 3). It is
well settled that, before the decision of administrative
bodies can be brought to courts for review, all
administrative remedies must first be exhausted,
especially in disputes concerning public lands, where
the finding of said administrative bodies, as to
questions of fact, are declared by statute to be
"conclusive" (C. A. 141, sec. 4; Lamb vs. Phipps., 22
Phil., 456; Arnedo vs. Aldanese, 63 Phil., 768; R.
Lopez vs. Court of Tax Appeals, 100, Phil., 850).
A party aggrieved by an erroneous decision
of the federal land department must exhaust
his remedies in that department before he
can resort to the courts, and where one
instituting a contest in a local land office
against a homestead entry did not to the
general land office or the secretary of the
 interior from an order dismissing the contest
because not sufficiently regular to constitute
a valid contest, he was bound thereby, and
he could not resort to the courts. Kendall vs.
Long, 66 Wash. 62, 119 p. 9 (Footnote 98 a,
50 C. J. 1093, 1094.)
As we held in Eloy Miguel vs. Anacleta M. Vda. de
Reyes, 93 Phil., 542, having failed to exhaust his
remedy in the administrative branch of the
Government, plaintiff cannot now seek relief in the
courts of justice."
Wherefore, the order appealed from is hereby
affirmed. with costs against plaintiff-appellant. It is
so ordered.
Bengzon, Padilla, Montemayor, Reyes, A., Bautista
Angelo, Labrador, Reyes, J.B.L., Endencia and Felix,
JJ.,concur.
G.R. No. 110048 November 19, 1999
SERVICEWIDE SPECIALISTS, INC., petitioner,
vs.
COURT OF APPEALS, HILDA TEE, &
ALBERTO M. VILLAFRANCA, respondents.
PURISIMA, J.:
This is a petition for review on certiorari under Rule
45 of Decision of the Court of Appeals 1 in CA-G.R.
CV No. 19571, affirming the judgment of the
Regional Trial Court of Manila, Branch XX,
dismissing Civil Case No. 84-25763 for replevin and
damages.
The litigation involves a motor vehicle, a Colt
Galant, 4-door Sedan automobile, with Motor No.
2E-08927, Serial No. A112A-5297, Model No. 1976.
The appellate court culled the facts that matter as
follows: 2
On May 14, 1976, Leticia L. Laus
of Quezon City purchased on credit
a Colt Galant . . . from Fortune
Motors (Phils.) Corporation. On the
same date, she executed a
promissory note for the amount of
P56,028.00, inclusive of interest at
12% per annum, payable within a
period of 48 months starting
August, 1976 at a monthly
installment of P1,167.25 due and
demandable on the 17th day of
each month (Exhibit "A", pp. 144,
Orig. Records,). It was agreed
upon, among others, that in case of
default in the payment of any
installment the total principal sum,
together with the interest, shall
become immediately due and
payable (Exhibit "A"; p. 144, Orig.
Records). As a security for the
promissory note, a chattel mortgage
was constituted over the said motor
vehicle (Exhibit "B", ibid.), with a
deed of assignment incorporated
therein such that the credit and
mortgage rights were assigned by
Fortune Motors Corp. in favor of
Filinvest Credit Corporation with
the consent of the mortgagor-debtor
Leticia Laus (Exhibits "B-1" and
"B-2", p. 147, ibid.). The vehicle
was then registered in the name of
Leticia L. Laus with the chattel
mortgage annotated on said
certificate. (Exhibit "H"; p.
154, ibid.)
On September 25, 1978, Filinvest
Credit Corporation in turn assigned
the credit in favor of Servicewide
Specialists, Inc. (Servicewide, for
brevity) transferring unto the latter
all its rights under the promissory
note and the chattel mortgage
(Exhibit "B-3", p. 149, ibid.) with
the corresponding notice of
assignment sent to the registered
car owner (Exhibit "C"; p.
150, ibid.).
On April 18, 1977, Leticia Laus
failed to pay the monthly
installments for that month. The
installments for the succeeding 17
months were not likewise fully
paid, hence on September 25, 1978,
pursuant to the provisions of the
promissory note, Servicewide
demanded payment of the entire
outstanding balance of P46,775.24
inclusive of interests (Exhibits "D"
and "E"; pp. 151-152, ibid.).
Despite said formal demand,
Leticia Laus failed to pay all the
monthly installments due until July
18, 1980.
On July 25, 1984, Servicewide sent
a statement of account to Leticia
Laus and demanded payment of the
amount of P86,613.32 representing
the outstanding balance plus
interests up to July 25, 1985,
attorney's fees, liquidated damages,
estimated repossession expense,
and bonding fee (Exhibit "F"; p.
153, ibid.)
As a result of the failure of Leticia
Laus to settle her obligation, or at
least to surrender possession of the
motor vehicle for the purpose of
foreclosure, Servicewide instituted
a complaint for replevin,
impleading Hilda Tee and John
Dee in whose custody the vehicle
was believed to be at the time of
the filing of the suit.
In its complaint, plaintiff alleged
that it had superior lien over the
mortgaged vehicle; that it is
lawfully entitled to the possession
of the same together with all its
accessories and equipments; (sic)
that Hilda Tee was wrongfully
detaining the motor vehicle for the
purpose of defeating its mortgage
lien; and that a sufficient bond had
been filed in court. (Complaint with
Annexes, pp. 1-13, ibid.). On July
30, 1984, the court approved the
replevin bond (p. 20, ibid.)
On August 1, 1984, Alberto
Villafranca filed a third party claim
contending that he is the absolute
owner of the subject motor vehicle
duly evidenced by the Bureau of
Land Transportation's Certificate of
Registration issued in his name on
June 22, 1984; that he acquired the
said mother vehicle from a certain
Remedios D. Yang under a Deed of
Sale dated May 16, 1984; that he
acquired the same free from all lien
and emcumbrances; and that on
July 30, 1984, the said automobile
was taken from his residence by
Deputy Sheriff Bernardo Bernabe
pursuant to the seizure order issued
by the court a quo.
Upon motion of the plaintiff below,
Alberto Villafranca was substituted
 as defendant. Summons was served
upon him. (pp. 55-56, ibid).
On March 20, 1985, Alberto
Villafranca moved for the dismissal
of the complaint on the ground that
there is another action pending
between the same parties before the
Regional Trial Court of Makati,
Branch 140, docketed as Civil Case
No. 8310, involving the seizure of
subject motor vehicle and the
indemnity bond posted by
Servicewide (Motion to Dismiss
with Annexes; pp. 57-110, ibid.)
On March 28, 1985, the court
granted the aforesaid motion (p.
122, ibid.), but subsequently the
order of dismissal was reconsidered
and set aside (pp. 135-136, ibid.).
For failure to file his Answer as
required by the court a quo,
Alberto Villafranca was declared in
default and plaintiff's evidence was
received ex parte.
On December 27, 1985, the lower
court rendered a decision
dismissing the complaint for
insufficiency of evidence. Its
motion for reconsideration of said
decision having been denied, . . . .
In its appeal to the Court of Appeals, petitioner
theorized that a suit for replevin aimed at the
foreclosure of a chattel is an action quasi in rem, and
does not require the inclusion of the principal obligor
in the Complaint. However, the appellate court
affirmed the decision of the lower Court;
ratiocinating, thus:
A cursory reading, however, of the
Promissory Note dated May 14,
1976 in favor of Fortune Motors
(Phils.) Corp. in the sum of
P56,028.00 (Annex "A" of
Complaint, p. 7, Original Records)
and the Chattel Mortgage of the
same date (Annex "B" of
Complaint; pp. 8-9, ibid.) will
disclose that the maker and
mortgagor respectively are one and
the same person: Leticia Laus. In
fact, plaintiff-appellant admits in
paragraphs (sic) nos. 2 and 3 of its
Complaint that the aforesaid public
documents (Annexes "A" and "B"
thereof) were executed by Leticia
Laus, who, for reasons not
explained, was never impleaded. In
the case under consideration,
plaintiff-appellant's main case is for
judicial foreclosure of the chattel
mortgage against Hilda Tee and
John Doe who was later substituted
by appellee Alberto Villafranca.
But as there is no privity of
contract, not even a causal link,
between plaintiff-appellant
Servicewide Specialists, Inc. and
defendant-appellee Alberto
Villafranca, the court a
quo committed no reversible error
when it dismissed the case for
insufficiency of evidence against
Hilda Tee and Alberto Villafranca
since the evidence adduced pointed
to Leticia Laus as the party liable
for the obligation sued upon (p. 2,
RTC Decision). 3
Petitioner presented a Motion for Reconsideration but
in its Resolution 4 of May 10, 1993, the Court of
Appeals denied the same, taking notice of another
case "pending between the same parties . . . relating
to the very chattel mortgage of the motor vehicle in
litigation."
Hence, the present petition for review
on certiorari under Rule 45. Essentially, the sole
issue here is: Whether or not a case for replevin may
be pursued against the defendant, Alberto
Villafranca, without impleading the absconding
debtor-mortgagor?
Rule 60 of the Revised Rules of Court requires that
an applicant for replevin must show that he "is the
owner of the property claimed, particularly
describing it, or is entitled to the possession
thereof." 5 Where the right of the plaintiff to the
possession of the specified property is so conceded or
evident, the action need only be maintained against
him who so possesses the property. In rem action est
per quam rem nostram quae ab alio possidetur
petimus, et semper adversus eum est qui rem
possidet. 6
Citing Northern Motors, Inc. vs. Herrera, 7 the Court
said in the case of BA Finance (which is of similar
import with the present case):
There can be no question that
persons having a special right of
property in the goods the recovery
of which is sought, such as a chattel
mortgagee, may maintain an action
for replevin therefor. Where the
mortgage authorizes the mortgagee
to take possession of the property
on default, he may maintain an
action to recover possession of the
mortgaged chattels from the
mortgagor or from any person in
whose hands he may find them. 8
Thus, in default of the mortgagor, the mortgagee is
thereby constituted as attorney-in-fact of the
mortgagor, enabling such mortgagee to act for and in
behalf of the owner. That the defendant is not privy
to the chattel mortgage should be inconsequential. By
the fact that the object of replevin is traced to his
possession, one properly can be a defendant in an
action for replevin. It is here assumed that the
plaintiff's right to possess the thing is not or cannot
be disputed. 9 (Emphasis supplied)
However, in case the right of possession on the part
of the plaintiff, or his authority to claim such
possession or that of his principal, is put to great
doubt (a contending party may contest the legal bases
for plaintiffs cause of action or an adverse and
independent claim of ownership or right of
possession may be raised by that party), it could
become essential to have other persons involved and
impleaded for a complete determination and
resolution of the controversy. 10 In the case under
scrutiny, it is not disputed that there is an adverse and
independent claim of ownership by the respondent as
evinced by the existence of a pending case before the
Court of Appeals involving subject motor vehicle
between the same parties herein. 11 Its resolution is a
factual matter, the province of which properly lies in
the lower Court and not in the Supreme Court, in the
guise of a petition for review on certiorari. For it is
basic that under Rule 45, this Court only entertains
questions of law, and rare are the exceptions and the
present case does not appear to be one of them.
In a suit for replevin, a clear right of possession must
be established. (Emphasis supplied) A foreclosure
under a chattel mortgage may properly be
commenced only once there is default on the part of
the mortgagor of his obligation secured by the
mortgage. The replevin in this case has been resorted
to in order to pave the way for the foreclosure of
what is covered by the chattel mortgage. The
conditions essential for such foreclosure would be to
show, firstly, the existence of the chattel mortgage
and, secondly, the default of the mortgagor. These
requirements must be shown because the validity of
the plaintiffs exercise of the right of foreclosure is
inevitably dependent thereon. 12
Since the mortgagee's right of possession is
conditioned upon the actual fact of default which
itself may be controverted, the inclusion of other
parties, like the debtor or the mortgagor himself, may
be required in order to allow a full and conclusive
determination of the case. When the mortgagee seeks
a replevin in order to effect the eventual foreclosure
of the mortgage, it is not only the existence of, but
also the mortgagor's default on, the chattel mortgage
that, among other things, can properly uphold the
right to replevy the property. The burden to establish
a valid justification for such action lies with the
plaintiff. An adverse possessor, who is not the
mortgagor, cannot just be deprived of his possession,
let alone be bound by the terms of the chattel
mortgage contract, simply because the mortgagee
brings up an action for replevin. 13
Leticia Laus, being an indispensable party, should
have been impleaded in the complaint for replevin
and damages. An indispensable party is one whose
interest will be affected by the court's action in the
litigation, and without whom no final determination
of the case can be had. The party's interest in the
subject matter of the suit and in the relief sought are
so inextricably intertwined with the other parties that
his legal presence as a party to the proceeding is an
absolute necessity. In his absence, there cannot be a
resolution of the dispute of the parties before the
Court which is effective, complete, or equitable.
Conversely, a party is not indispensable to the suit if
his interest in the controversy or subject matter is
distinct and divisible from the interest of the other
parties and will not necessarily be prejudiced by a
judgment which does complete justice to the parties
in Court. He is not indispensable if his presence
would merely complete relief between him and those
already parties to the action or will simply avoid
multiple litigation. 14 Without the presence of
indispensable parties to a suit or proceeding, a
judgment of a Court cannot attain real finality. 15
That petitioner could not locate the mortgagor,
Leticia Laus, is no excuse for resorting to a
procedural short-cut. It could have properly availed
of substituted service of summons under the Revised
Rules of Court. 16 If it deemed such a mode to be
unavailing, it could have proceeded in accordance
with Section 14 of the same Rule. 17 Indeed,
petitioner had other proper remedies, it could have
resorted to but failed to avail of. For instance, it could
have properly impleaded the mortgagor. Such failure
is fatal to petitioner's cause.
With the foregoing disquisition and conclusion, the
other issues raised by petitioner need not be passed
upon.
WHEREFORE, the Petition is DENIED and the
Decision of the Court of Appeals in CA-G.R. CV No.
19571 AFFIRMED. No pronouncement as to costs.
SO ORDERED.
.R. No. L-17828 August 31, 1963
LIGAYA MINA, JAIME MINA, SILVINA
MINA, FAUSTA MINA,
PABLO MINA and MIGUEL MINA, the minors
represented by PILAR LAZO as guardian-ad-
litem, plaintiffs-appellants,
vs.
ANTONIA PACSON, CRISPINO MEDINA and
CRESENCIA MINA, defendants-appellees.
F. A. Pelmoka for plaintiffs-appellants.
Castelo Law Office for defendants-appellees.
LABRADOR, J.:
This is an appeal from an order of the Court of First
Instance of Nueva Ecija, Hon. Felix Makasiar,
presiding, in its Civil Case No. 3296, entitled "Ligaya
Mina, et al., plaintiffs vs. Crispino Medina, et al.,
defendants," dismissing the complaint filed in this
case. The appellant also appeals against the order
denying the motion for reconsideration of the order
of dismissal.
The facts necessary to understand the nature of the
issues presented in this appeal, as gleaned from the
pleadings, may be briefly stated as follows: Plaintiffs
Ligaya, Jaime, Silvina, Fausta, Pablo and Miguel, all
surnamed Mina, are alleged to be the illegitimate
children of the deceased Joaquin Mina with plaintiff
Pilar Lazo from 1933-1958, while married to Antonia
Pacson. Joaquin Mina died in August, 1958, leaving
no descendants norascendants except his widow, the
defendant herein Antonia Pacson. On April 9, 1958,
Joaquin Mina, then still living, executed a deed of
absolute sale (Annex "B" to Complaint) of three
parcels of land situated in the municipality of Muñoz,
Nueva Ecija, in favor of the defendants Crispino
Medina and Cresencia Mina for the sum of P12,000.
On April 15, 1958 again he executed another deed of
sale (Annex "C" to Complaint) of 13 parcels of land
covered by 12 transfer certificates of title to the same
spouses Crispino Medina and Cresencia Mina. Both
deeds of sale bear the conformity of his wife Antonia
Pacson.
In the complaint filed in the Court of First Instance of
Nueva Ecija in the case which originated this appeal,
it is alleged that plaintiffs are illegitimate children of
the deceased Joaquin Mina begotten by him with
Pilar Lazo during the period from 1933 to 1958 while
Joaquin Mina was lawfully married to Antonia
Pacson; that the plaintiff Pablo Mina is a recognized
illegitimate child of the deceased Joaquin Mina; that
Joaquin Mina died intestate leaving no ascendants or
descendants, except his widow Antonia Pacson; that
he left various parcels of land enumerated in the
complaint but that on April 9, 1950 the defendants
connived and secured from Joaquin Mina, who was
ill and did not know what he was doing, the
execution of the two deeds of sale without
consideration, fictitiously and fraudulently,
transferring his propertiesto the spouses Crispino
Medina and Cresencia Mina; and that by reason of
said acts, defendants have caused moral anguish,
anxiety and embarrassment to plaintiffs, causing
them damages amounting to P10,000; that plaintiffs
pray that they be declared recognized illegitimate
children of the deceased Joaquin Mina, entitled to
share in the properties left by him as such illegitimate
children; that the deeds of sale, Annexes "B" and "C"
be declared fictitious, fraudulent and therefore, null
and void; and that defendants be required to deliver
to plaintiffs' possession one-fourth of said properties
together with P10,000 for moral damages.
Upon the filing of the complaint the defendants
presented a motion to dismiss the complaint on the
ground of res judicata, alleging that a similar action
had previously been presented as Civil Case No.
3015 in the same court, and by the same parties
against Crispino Medina and Cresencia Mina, in
which the same allegations of plaintiffs' status and
fraudulent conveyance of the properties to defendants
are alleged, together with a prayer for moral damages
in the sum of P20,000. It appears, however, that in
the complaint filed in said Civil Case No. 3015, no
prayer is made for the declaration of the filiation of
the plaintiffs in relation or with respect to the
deceased Joaquin Mina.
The motion to dismiss also copied an order of the
court issued in said Civil Case No. 3015 which reads
as follows:
Acting on the Motion filed by the
defendants on December 22, 1958 for the
reconsideration of the order dated December
8, 1958, and considering that the present
action is not only for annulment of deeds of
sale but also for partition (paragraphs 8 and
11 of the complaint and paragraph 4 of the
prayer thereof); that to avoid multiplicity of
suits, the complex action to establish
filiation andfor partition or for recovery of
inheritance may be brought in the same case
(Lopez v. Lopez, 68 Phil. 227; Escoval vs.
Escoval, 48 O.G. 615; Edades vs. Edades, L-
8964, July 31, 1956); and that Antonia
Pacson, the surviving widow and the other
intestate heirs of the deceased Joaquin Mina,
or necessary parties are not made a party in
this case (Briz v. Briz, 43 Phil. 763), the
plaintiffs are hereby directed to amend their
complaint within fifteen (15) days from
receipt hereof by including as party
defendant the surviving widow of the
deceased Joaquin Mina and other necessary
parties.
Should the plaintiffs fail to comply with this
order, this case will be dismissed.
Lastly, another order of the same court dated
February 9, 1959 was quoted, the dispositive part of
which reads:
The fifteen-day period granted to the
plaintiffs having elapsed without said order
having been complied with, the Court
hereby dismisses this case, without
pronouncement aa to costs.
Opposition to the motion to dismiss was presented on
behalf of the plaintiffs by their attorney to which a
reply was filed on behalf of the defendants. A
rejoinder was also filed after which Judge Genaro
Tan Torres, then presiding over the court, sustained
the motion to dismiss in an order which reads as
follows:
After a careful consideration of the joint
motion to dismiss of defendants Antonia
Pacson and the spouses Crispino Medina
and Cresencia Mina, dated November 11,
1959, the opposition thereto dated
November 24, 1959, and the reply of the
defendants to the opposition, dated
December 7, 1959, the Court is of the
opinion that said motion to dismiss is well
 taken; hence this case is hereby dismissed
without costs.
Plaintiffs' motion for time to submit
rejoinder, dated December 10, 1959, is
hereby denied because it will only
unnecessarily delay the termination of this
case.
So ordered.
Cabanatuan City, December 18, 1959.
A motion for the reconsideration of the order of the
court dismissing the action having been denied, the
plaintiffs in the present case prosecuted this appeal
directly to this Court.1äwphï1.ñët
As shown above the question to be resolved is
whether or not the order dismissing the previous
Civil Case No. 3015 bars the present civil action No.
3296 of the Court of First Instance of Nueva Ecija.
In the first error assigned by the appellants in their
brief it is argued that the dismissal of the complaint
in the previous action was in fact "at the indirect
instance of the plaintiffs through inaction or
omission." We do not find this claim justified by the
facts of the case. The order of the court dismissing
the complaint in the first case contains the following
warning: "Should the plaintiffs fail to comply with
this order, this case will be dismissed." In the face of
this express warning given in the court's order the
dismissal can not be said to have been "at the indirect
instance of the plaintiffs; it was in fact caused by
plaintiffs' refusal to comply with the express mandate
contained in the order of dismissal. The dismissal,
therefore, was justified under Rule 30, Section 3 of
the Rules of Court, which reads:
SEC. 3. Failure to prosecute. — When
plaintiff fails to appear at the time of the
trial, or to prosecute his action for an
unreasonable length of time, or to comply
with these rules of any order of the court, the
action may be dismissed upon motion of the
defendant or upon the court's own motion.
This dismissal shall have the effect of an
adjudication upon the merits, unless
otherwise provided by court.
The above provision of the Rules was invoked in the
case, of Garchitorena, et al. vs. De los Santos, et al.,
G.R. No. L-17045, June 30, 1962, wherein this Court
held:
To order an amendment to a complaint
within a certain period in order to implead as
party plaintiff or defendant one who is not a
party to the case lies within the discretion of
the Court. And where it appears that the
person to be impleaded is an indispensable
party, the party to whom such order is
directed has no other choice but to comply
with it. His refusal or failure to comply with
the order is a ground for the dismissal of his
complaint pursuant to Section 3, Rule, 30, of
the Rules of Court. . . .
Under the second assignment of error it is argued that
the dismissal of the previous case was brought about
by the negligence, gross or criminal, of plaintiffs'
lawyer for which the plaintiffs-appellants should not
be made to suffer. The argument is not true to fact.
The failure to amend was a result not of the neglect
of the lawyer alone but also of the plaintiffs-
appellants themselves. Had the plaintiffs taken even
an ordinary interest in the result of the action that
they had filed, they would have been able to secure
information from their lawyer that the case had been
dismissed for failure to amend. Upon receipt of such
information, plaintiffs could have applied to the court
for relief under Rule 38 of the Rules of Court and
could have had the complaint amended as directed in
the order of dismissal. It is not alone negligence of
their counsel, therefore, but of themselves also that
the required amendment was not made. But assuming
for the sake of argument that the failure was due to
the lawyer alone, such failure would not relieve them
of the responsibility resulting from the neglect of
their lawyer, for the client is bound by the action of
his counsel. (Isaac v. Mendoza, G. R. No. L-2830,
June 21, 1951; Vivero v. Santos, et al., G. R. No. L-
8105, Feb. 28, 1956; Fernandez v. Tan Tiong Tick,
G.R. No. L-15877, April 28, 1961; Gordulan v.
Gordulan, G.R. No. L-17722, Oct. 9, 1962; Valerio v.
Sec. of Agriculture, G.R. No. L-18587, April 23,
1963.)
In the third assigiament of error it is claimed that
there is no complete identity between the parties in
the first case and those in the case at bar. The
statement is true because in the previous case
Antonia Pacson was not included as party-defendlant.
As a matter of fact the order decided that Pacson was
to be included as party-defendant. As to the latter,
therefore, the previous order of dismissal does not bar
the present complaint, not only because she was not
made a party but also because the issue of filiation of
the parties-plaintiffs was not raised in the previous
case, although such issue was necessary for the
plaintiffs to be able to maintain their right of action.
In view of this fact, the present action should be
considered barred in respect to the action for the
annulment of the deeds of sale and as regards the
defendants spouses Crispino Medina and Cresencia
Mina; but as to the case for the declaration of the
plaintiffs as illegitimate children and heirs of the
deceased Joaquin Mina this latter case is not barred
by the previous action as above explained and may
still be prosecuted.
WHEREFORE, the order of dismissal is hereby
modified in the sense that the action for the
recognition of the filiation of the plaintiffs should be
allowed to continue against the defendant Antonia
Pacson; but the dismissal of the action for the
annulment of the deeds of sale is affirmed. Without
costs.
Bengzon, C.J., Padilla, Bautista Angelo, Concepcion,
Reyes, J.B.L., Barrera, Paredes, Dizon, Regala and
Makalintal, JJ., concur.
G.R. No. L-22909 January 28, 1925
VICTORIANO BORLASA, ET AL., plaintiffs-
appellants,
vs.
VICENTE POLISTICO, ET AL., defendants-
appellees.
Sumulong and Lavides for appellants.
Ramon Diokno for appellees.
STREET, J.:
This action was instituted in the Court of First
Instance of Laguna on July 25, 1917, by Victoriano
Borlasa and others against Vicente Polistico and
others, chiefly for the purpose of securing the
dissolution of a voluntary association named Turuhan
Polistico & Co., and to compel the defendants to
account for and surrender the money and property of
the association in order that its affairs may be
liquidated and its assets applied according to law.
The trial judge having sustained a demurrer for defect
of parties and the plaintiffs electing not to amend, the
cause was dismissed, and from this order an appeal
was taken by the plaintiffs to this court.
The material allegations of the complaint, so far as
affects the present appeal, are to the following effect:
In the month of April, 1911, the plaintiffs and
defendants, together with several hundred other
persons, formed an association under the name
of Turuhan Polistico & Co. Vicente Polistico, the
principal defendant herein, was elected president and
treasurer of the association, and his house in Lilio,
Laguna, was made its principal place of business.
The life of the association was fixed at fifteen years,
and under the by-laws each member obligated
himself to pay to Vicente Polistico, as president-
treasurer, before 3 o'clock in the afternoon of every
Sunday the sum of 50 centavos, except that on every
fifth Sunday the amount was P1, if the president
elected to call this amount, as he always did. It is
alleged that from April, 1911, until April, 1917, the
sums of money mentioned above were paid weekly
by all of the members of the society with few
irregularities. The inducement to these weekly
contributions was found in provisions of the by-laws
to the effect that a lottery should be conducted
weekly among the members of the association and
that the successful member should be paid the
amount collected each week, from which, however,
the president-treasurer of the society was to receive
the sum of P200, to be held by him as funds of the
society.
It is further alleged that by virtue of these weekly
lotteries Vicente Polistico, as president-treasurer of
the association, received sums of money amounting
to P74,000, more or less, in the period stated, which
he still retains in his power or has applied to the
purchase of real property largely in his own name and
partly in the names of others. The defendants in the
complaint are the members of the board of directors
of the association, including Vicente Polistico, as
president-treasurer, Alfonso Noble, secretary, Felix
Garcia and Vivencio Zulaybar, as
promoter(propagandistas), and Afroniano de la Peña
and Tomas Orencia, as members (vocales) of the
board.
In an amended answer the defendants raised the
question of lack of parties and set out a list of some
hundreds of persons whom they alleged should be
brought in as parties defendant on the ground, among
others, that they were in default in the payment of
their dues to the association. On November 28, 1922,
the court made an order requiring the plaintiffs to
amend their complaint within a stated period so as to
include all of the members of the Turnuhan Polistico
& Co. either as plaintiffs or defendants. The plaintiffs
excepted to this order, but acquiesced to the extent of
amending their complaint by adding as additional
parties plaintiff some hundreds of persons, residents
of Lilio, said to be members of the association and
desirous of being joined as plaintiffs. Some of these
new plaintiffs had not been named in the list
submitted by the defendants with their amended
answer; and on the other hand many names in said
list were here omitted, it being claimed by the
plaintiffs that the persons omitted were not residents
of Lilio but residents of other places and that their
relation to the society, so far as the plaintiffs could
discover, was fictitious. The defendants demurred to
the amended complaint on the ground that it showed
on its face a lack of necessary parties and this
demurrer was sustained, with the ultimate result of
the dismissal of the action, as stated in the first
paragraph of this opinion.
The trial judge appears to have supposed that all the
members of the Turnuhan Polistico & Co. should be
brought in either plaintiffs or defendants. This notion
is entirely mistaken. The situation involved is
precisely the one contemplated in section 118 of the
Code of Civil Procedure, where one or more may sue
for the benefit of all. It is evident from the showing
made in the complaint, and from the proceedings in
the court below, that it would be impossible to make
all of the persons in interest parties to the cases and to
require all of the members of the association to be
joined as parties would be tantamount to a denial of
justice.
The general rule with reference to the making of
parties in a civil action requires, of course, the joinder
of all necessary parties wherever possible, and the
joinder of all indispensable parties under any and all
conditions, the presence of those latter being a sine
qua non of the exercise of judicial power. The class
suit contemplates an exceptional situation where
there are numerous persons all in the same plight and
all together constituting a constituency whose
presence in the litigation is absolutely indispensable
to the administration of justice. Here the strict
application of the rule as to indispensable parties
would require that each and every individual in the
class should be present. But at this point the practice
is so far relaxed as to permit the suit to proceed,
when the class is sufficient represented to enable the
court to deal properly and justly with that interest and
with all other interest involved in the suit. In the class
suit, then, representation of a class interest which will
be affected by the judgment is indispensable; but it is
not indispensable to make each member of the class
an actual party.
A common illustration in American procedure of the
situation justifying a class suit is that presented by the
creditors' bill, which is filed by one party interested
in the estate of an insolvent, to secure the distribution
of the assets distributable among all the creditors. In
such cases the common practice is for one creditor to
sue as plaintiff in behalf of himself and other
creditors. (Johnson vs. Waters, 111 U.S., 640; 28
Law. ed., 547.) Another illustration is found in the
case of Smith vs. Swormstedt (16 How., 288; 14
Law. ed., 942), where a limited number of
individuals interested in a trust for the benefit of
superannuated preachers were permitted to maintain
an action in their own names and as representatives
of all other persons in the same right.
His Honor, the trial judge, in sustaining this demurrer
was possibly influenced to some extent by the case
ofRallonza vs. Evangelista (15 Phil., 531); but we do
not consider that case controlling, inasmuch as that
was an action for the recovery of real property and
the different parties in interest had determinable,
though undivided interests, in the property there in
question. In the present case, the controversy
involves an indivisible right affecting many
individuals whose particular interest is of
indeterminate extent and is incapable of separation.
The addition of some hundreds of persons to the
number of the plaintiffs, made in the amendment to
the complaint of December 13, 1922, was
unnecessary, and as the presence of so many parties
is bound to prove embarrassing to the litigation from
death or removal, it is suggested that upon the return
of this record to the lower court for further
proceedings, the plaintiff shall again amend their
complaint by dismissing as to unnecessary parties
plaintiffs, but retaining a sufficient number of
responsible persons to secure liability for costs and
fairly to present all the members of the association.
There is another feature of the complaint which
makes a slight amendment desirable, which is, that
the complaint should be made to show on its face that
the action is intended to be litigated as a class suit.
We accordingly recommend that the plaintiffs further
amend by adding after the names of the parties
plaintiffs the words, "in their own behalf and in
behalf of other members of Turuhan Polistico & Co."
The order appealed from is reversed, the demurrer of
the defendants based upon supposed lack of parties is
overruled, and the defendants are required to answer
to the amended complaint within the time allowed by
law and the rules of the court. The costs of this
appeal will be paid by the defendants. So ordered.
Johnson, Malcolm, Villamor, Ostrand, Johns, and
Romualdez, JJ., concur.
G.R. No. L-34124 April 30, 1985
MR. & MRS. TADEO P. DAEL, petitioners,
vs.
THE HON. BERNARDO TEVES, as Presiding
Judge, Court of First Instance of Misamis
Oriental, Branch VIII and DIONISIO EDOROT,
VIDAL EDOROT, PONCIANO EDOROT,
PETRA EDOROT, DIOSDADA EDOROT,
JUANA EDOROT, and the late
HERMINIGILDO EDOROT, represented by his
heirs. VICTOR EDOROT, PEDRITO EDOROT
and JACOBO EDOROT, respondents.
CUEVAS, J.:
Petition for Review on certiorari of the Order of the
Hon. respondent Presiding Judge of the Court of First
Instance of Misamis Oriental-Branch VIII, issued on
July 27, 1971 in Civil Case No. 3531 entitled "Mr. &
Mrs. Tadeo P. Dael versus Dionisio Edorot, et al",
dismissing petitioners' complaint; and his Honor's
order of August 12, 1971 denying petitioners' motion
for reconsideration of the said order of dismissal.
On October 19, 1970, petitioners filed with the then
Court of First Instance of Misamis Oriental, a
complaint for: "Ownership, Recovery of Possession
& Damages" against the private respondents. The
case was docketed in the said court as Civil Case No.
3531.
The complaint, among others, alleged that petitioners,
then plaintiffs, are the true and absolute owners in fee
simple of a parcel of land with an area of 18,000
square meters, more or less, situated at Aplaya,
Jasaan, Misamis Oriental, having purchased the same
from the late Esteban Edorot on May 17 1962; and
that sometime in the month of February 1964, after
the death of Esteban Edorot, the defendants (herein
private respondents) by means of force, threats and
intimidation surreptitiously occupied the said
property.
Private respondents, through counsel, filed their
Answer with Counterclaim on January 18, 1911,
claiming that the property in question is owned by
them pro-indiviso by inheritance from their deceased
parents.
The issue having been joined, the case was set for
pre-trial on various occasions in Branch VIII of the
Court of First Instance of Misamis Oriental then still
presided by the Hon. Severo Malvar "to give the
parties more chance to arrive at an amicable
settlement." 1 In all these pre-trial conferences,
counsel for private respondents and respondent Vidal
Edorot appeared. The latter had a special power of
attorney to appear for defendants Dionisio, Diosdada,
Ponciano and Juana. The two other defendants, Petra
and Herminigildo, died long before the filing of the
complaint.
After June 2, 1971. Judge Severo Malvar was
transferred to another judicial district and respondent
Judge Bernardo Teves was appointed to take his
place.
On June 29, 1971 when the case was set for pre-trial
for the first time before respondent Judge Bernardo
Teves, an Order reading as follows-
Considering that, as manifested
before the Court, two of the
defendants died before the filing of
this case; the plaintiffs are hereby
given until July 15, 1971 within
which to file an amended complaint
to include the heirs or
representatives of said deceased
defendants, furnishing copy thereof
to Atty. Dumlao.
was issued by the respondent Judge.
On July 27, 1971, counsel for private respondents
filed an Ex- Parte Manifestation, praying that the case
be dismissed pursuant to Section 3, Rule 17 of the
Rules of Court for failure of petitioners to comply
with the aforequoted order of the Court to file an
amended complaint. Acting thereon, the trial court on
July 27, 1971 issued the order now assailed
dismissing the complaint, which reads-
As prayed for by the defendants,
through counsel, Atty. Florentino
Dumlao, Jr. in his ex-parte
manifestation of July 27, 1971,
which the Court finds well-
founded, this case is hereby
dismissed for failure of the
plaintiffs to comply with the Order
of this Court dated June 29, 1971.
No pronouncement as to costs.
SO ORDERED.
Petitioners' motion to reconsider the foregoing Order
having been denied, they now come before Us
through the instant petition, contending that
respondent Judge -
1. acted without jurisdiction or with grave abuse of
discretion in ordering petitioners to file an amended
complaint, to include the alleged heirs and/or
representatives of respondents Petra Edorot and
Herminigildo Edorot, deceased;
2. committed a legal error in admitting respondents'
ex-parte motion to dismiss Civil Case No. 3531 and
in issuing the order dismissing Civil Case No. 3531;
and
3. acted without or in excess of its jurisdiction in
denying petitioners' motion for reconsideration.
In their complaint, petitioners (then plaintiffs) claim
that they are the owners of the parcel of land in
question. 2Private respondents, on the other hand, in
their Answer controvert such assertion. 3 They also
claim to be the owners and possessors, pro-indiviso
by inheritance from their deceased parents, of the
subject litigated parcel. Necessarily then, deceased
defendants Herminigildo Edorot and Petra Edorot
have an undivided interest, right and participation
adverse to that of the petitioners' in the property in
litigation. Since both of them are already dead
(Herminigildo died on September 29, 1969 and Petra
died on April 5, 1970) even prior to the filing of the
complaint against them in the court below and their
interest in the property in question having inured by
intestacy to their heirs, the latter thereby became the
real parties in interest who should be impleaded as
defendants without whom no final determination of
Civil Case No. 3531 can be had. Decidedly then they
are indispensable parties who should be compulsory
joined as defendants in the instant case. Sections 2
and 7, Rule 3 of the Rules of Court provides-
Section 2. Parties in interest. —
Every action must be prosecuted
and defended in the name of the
real party in interest. All persons
having an interest in the subject of
the action and in obtaining the
relief demanded shall be joined as
plaintiffs. All persons who claim an
 interest in the controversy or the
subject thereof adverse to the
plaintiff, or who are necessary to
complete determination or
settlement of the question involved
therein shall be joined as
defendants.
Section 7. Compulsory joinder of
indispensable parties.—Parties in
interest without whom no final
determination can be had of an
action shall be joined either as
plaintiffs or defendants.
The heirs of deceased defendants in the case at bar
being clearly indispensable parties, respondent Judge
acted properly in ordering the amendment of the
complaint so as to include the said heirs as
defendants. Since the petitioners failed to comply
with this Order, respondent Judge acted within his
prerogative in dismissing the complaint 4 pursuant to
Section 3, Rule 17 of the Rules of Court which
provides that—
If the plaintiff fails to appear at the
time of the trial, or to prosecute his
action for unreasonable length of
time, or to comply with these rules
or any order of the court the action
maybe dismissed upon motion of
the defendant or upon the court's
own motion. This dismissal shall
have the effect of an adjudication
upon the merits unless provided by
the court. (Emphasis supplied)
Thus, it has been held that—
Where the Court orders the plaintiff
to amend its complaint within a
certain period of time in order to
implead as party defendants one
who is not a party to the case but
who is an indispensable
party,plaintiff's refusal to comply
with such order is a ground for the
dismissal of the complaint.
(Garchitorena, et al. vs. de los
Santos, et al. No. L-17045, June 30,
1962, 115 Phil. 490, citing Bautista
vs. Teodoro, 54 O.G. 619; Dizon
vs. Garcia, et al., G.R. No. L-
14690, November 29, 1960)
Petitioners now claim that their failure to amend the
complaint was due to the fact that private
respondents' counsel failed to inform the Court of the
names of the heirs and/or representatives of the
deceased defendants (Herminigildo and Petra Edorot)
pursuant to Section 16, Rule 3, New Rules of Court
which provides-
Section 16. Duty of attorney upon
death incapacity or incompetency
of party.—Whenever a party to a
pending case dies,
becomes incapacitated, or
incompetent, it shall be the duty of
his attorney to inform the court
promptly of such death, incapacity
or incompetency and to give the
name and residence of his executor,
administrator, guardian or other
legal representative (Emphasis
supplied)
We find petitioners' reliance on the aforequoted
provision as misplaced. Rule 3, Section 16 of the
Rules applies to a situation where a party (whether
plaintiff or defendant) dies after the filing of the
complaint and during the pendency of the case. This
is not the situation in the case at bar since the two
defendants, whose heirs are to be impleaded died
even before the filing of the complaint.
The other contention of petitioners that there is no
more necessity of amending the complaint because
allegedly an affidavit of waiver of rights have been
executed by one Victor Edorot is also not
meritorious. It is not disputed that said Victor Edorot
is only one of the heirs of deceased defendant
Herminigildo Edorot. He is not the sole owner of the
entire interest of Herminigildo. Neither is his waiver
binding upon the other heirs of said deceased.
Finally, anent the contention of petitioners that
private respondents "ex-parte manifestation" did not
comply with the required notice of motions pursuant
to Sections 4, 5 and 6 of Rule 15 of the Rules of
Court, suffice it to state that the said "manifestation"
informing the Court that petitioners have not
complied with the order to amend the complaint, is
not a litigated or contentious motion and may be
acted upon even without proof of service on the
adverse party. 5 In fact, under Section 3 of Rule 17,
quoted earlier, the Court can motu proprio or on its
own motion, dismiss the case for failure to comply
with its order.
Upon the foregoing facts, We find that respondent
Judge committed no error in dismissing the
complaint. However, to avoid injustice, such
dismissal should not operate as an adjudication on the
merits. 6
WHEREFORE, the lower court's Order of dismissal,
which should be understood to be without prejudice,
is AFFIRMED. Cost against petitioners.
SO ORDERED.
Makasiar, Abad Santos and Escolin JJ., concur.
Concepcion Jr., J., is on leave.
Separate Opinions
AQUINO, J., concurring:
The dismissal should be without prejudice.
Petitioners' counsel should have stated the name of
Dael's wife, "Mr. and Mrs." is on leave
Separate Opinions
AQUINO, J., concurring:
The dismissal should be without prejudice.
Petitioners' counsel should have stated the name of
Dael's wife, "Mr. and Mrs." is on leave
G.R. No. L-18707 February 28, 1967
AGUSTIN O. CASEÑAS, plaintiff-appellant,
vs.
CONCEPCION SANCHEZ VDA. DE ROSALES
(Substituted by her heirs), ROMEO S. ROSALES,
ET AL.,defendants-appellees.
Juan L. Pastrana for plaintiff-appellant.
Francisco Ro. Cupin and Wenceslao B. Resales for
defendants-appellees.
REGALA, J.:
This is an appeal from the order of dismissal entered
by the Court of First Instance of Agusan in Civil
Case No. 780, entitled Agustin Caseñas vs.
Concepcion Sanchez Vda. de Rosales, et al.
On August 21, 1952, Rodolfo Arañas and Agustin O.
Caseñas filed with the Court of First Instance of
Agusan, under Civil Case No. 261, a complaint for
specific performance and enforcement of their
alleged right under a certain deed of sale, and
damages against the spouses Jose A. Rosales and
Concepcion Sanchez. They alleged that sometime in
1939, Agustin O. Caseñas acquired from Rodolfo
Arañas under a deed of assignment, the latter's rights
and interest over a parcel of land covering an area of
more or less than 2,273 square meters and designated
as Lot No. 445-A of the Butuan Cadastre No. 84
(Psd. 4943); that Rodolfo Arañas in turn, acquired the
said property from the spouses Jose A. Rosales and
Concepcion Sanchez under a deed of sale executed
on March 18, 1939 under the terms of which,
however, the actual transfer of the aforesaid land unto
the vendee would be made only on or before
February 18, 1941; and that despite the above
documented transactions, and despite the arrival of
the stipulated period for the execution of the final
deed of transfer, the vendors spouses refused to fulfill
their obligation to effect such transfer of the said lot
to the vendee, Rodolfo Arañas or his assignee, the
herein appellant, Agustin O. Caseñas. Thus, the
principal relief prayed for in the above complaint was
for an order directing the defendants-spouses to
"execute a deed of absolute sale of the property
described in the complaint in favor of the assignee,
plaintiff Agustin O. Caseñas.
After the defendants-spouses had filed their answer to
the above complaint, but before trial, the counsel for
the plaintiffs gave notice to the trial court that
plaintiff Rodolfo Arañas and defendant Jose A.
Rosales had both died. In view of the said
manifestation, the lower court, in an order dated
April 27, 1956, directed, the surviving plaintiff,
Agustin O. Caseñas, to amend the complaint to effect
the necessary substitution of parties thereon. The said
surviving plaintiff, however, failed altogether to
comply with the aforementioned order of April 27,
1956 to the end that on July 18, 1957, the lower court
issued the following order:
Until this date no amended complaint was
filed by the attorney for the plaintiffs. This
shows abandonment and lack of interest on
the part of the plaintiffs. This being an old
case, for failure on the part of the counsel
for the plaintiffs to comply with the order of
this Court the same is hereby dismissed
without pronouncement as to costs.
As no appeal was taken from the above order of
dismissal, the same, in due time, became final.
On April 18, 1960, Agustin O. Caseñas, the same
plaintiff Caseñas in civil Case No. 261, filed with the
same Court of First Instance of Agusan, under Civil
Case No. 780, another complaint against the widow
and heirs of the late Jose A. Rosales "to quiet, and for
reconveyance of, title to real property, with
damages." This suit referred itself to the very same
property litigated under Civil Case No. 261 and
asserted exactly the same allegations as those made
in the former complaint, to wit: "that the plaintiff
(Agustin O. Caseñas) has acquired the above-
described property by purchase from its previous
owner, Rodolfo Arañas now deceased, ...; and said
Rodolfo Aranas had in turn acquired the same
property by virtue of another deed of sale executed
by Jose A. Rosales, now also deceased;" (Par. 3,
Complaint) "that under the terms and stipulations of
paragraph 2 of the deed of sale (between Rosales and
Arañas) ... Jose A. Rosales was to hold title to the
land in question in favor of Rodolfo Arañas or the
latter's signs and successors in interest for a period of
(5) years from February 19, 1936, at the expiration of
which said Jose A. Rosales was to execute a
document conveying absolutely the title to the land in
question in favor of the aforementioned Rodolfo
Arañas or his assigns and successors in interest" (Par.
9, Complaint) ; "despite which obligation the
defendants refused, even after the expiration of the
stipulated period to "convey title to the land in
question and to execute the corresponding document
covering the same." (Par. 12, Complaint) In the
premises, the plaintiff prayed for judgment "quieting
the title of the plaintiff to the land in question and
ordering the defendants to execute a deed of
conveyance of the same in favor of the said plaintiff"
plus costs and damages.
To the above complaint, the defendants filed a
motion to dismiss on several grounds, namely: res
judicata, prescription, lack of cause of action, failure
to include indispensable parties, and that the contract
subject of the complaint was void ab initio. After the
plaintiff had filed his opposition to the above motion,
the lower court issued the order under appeal
dismissing the complaint. Of the above grounds,
though, the lower court relied alone on the
defendants' plea of res judicata, lack of cause of
action and prescription. The material portion of this
order of dismissal reads:
The Court, however, believes that this action
is barred by prior judgment. The order of
dismissal in Civil Case No. 261 was already
final and has the effect of an adjudication
upon the merits. The parties in Civil Case
No. 261 and in this case are substantially the
same; the subject matter is the same and
there is identity of cause of action. All the
elements of res judicata are therefore
present.1äwphï1.ñët
Moreover, the complaint states no cause of
action if its purpose is to quiet title, because
the plaintiff has as yet no title to the land in
question. Precisely, this action is brought in
order to acquire or secure title by
compelling the defendants to execute a deed
of sale in favor of the plaintiff. However,
this action for specific performance cannot
also prosper because being based upon an
agreement in writing it is already barred by
prescription as the period of ten years has
long expired when the present complaint
was filed.
The appeal at bar assails the above determination that
Civil Case No. 780 is barred by a prior judgment and
by prescription and that the same states no cause of
action. It is on these issues, therefore, that this Court
shall dispose of this appeal.
We find for the appellant.
When certain of the parties to Civil Case No. 261
died and due notice thereof was given to the trial
court, it devolved on the said court to order, not the
amendment of the complaint, but the appearance of
the legal representatives of the deceased in
accordance with the procedure and manner outlined
in Rule 3, Section 17 of the Rules of Court, which
provides:
SEC. 17. Death of Party. — After a party
dies and the claim is not thereby
extinguished, the court shall order, upon
proper notice, the legal representative of the
deceased to appear and to be substituted for
the deceased, within a period of thirty (30)
days, or within such time as may be granted.
If the legal representative fails to appear
within said time, the court may order the
opposing party to procure the appointment
of a legal representative of the deceased
within a time to be specified by the court,
and the representative shall immediately
appear for and on behalf of the interest of
the deceased. The court charges involved in
procuring such appointment, if defrayed by
the opposing party, may be recovered as
costs. The heirs of the deceased may be
allowed to be substituted for the deceased,
without requiring the appointment of an
executor or administrator and the court may
appoint guardian ad litem for the minor
heirs.
In the case of Barrameda vs. Barbara, 90 Phil. 718,
this court held that an order to amend the complaint,
before the proper substitution of parties as directed
by the aforequoted rule has been effected, is void and
imposes upon the plaintiff no duty to comply
therewith to the end that an order dismissing the said
complaint, for such non-compliance, would similarly
be void. In a subsequent case, Ferriera et al. vs.
Gonzalez, et al., G.R. No. L-11567, July 17, 1958,
this court affirmed a similar conclusion on the In view of all the foregoing, the order dated January
determination that the continuance of a proceedings 20, 1961 dismissing Civil Case No. 780 is hereby set
during the pendency of which a party thereto dies, aside and the said case is ordered remanded to the
without such party having been validly substituted in court of origin for trial on the merits. Costs against
accordance with the rules, amounts to a "lack of the appellees.
jurisdiction." Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal,
The facts of this case fit four squares into the Bengzon, J.P., Zaldivar, Sanchez and Castro, JJ.,
Barrameda case abovecited, save for the minor concur.
variance that in the former two of the litigants died
while only one predeceased the case in Barrameda.
Here, as in Barrameda, during the pendency of civil
case, notice was given to the trial court of the deaths
of one of the plaintiffs and one of the defendants in it.
Instead of ordering the substitution of the deceased's
legal representatives in accordance with Rule 3,
section 17 of the Rules of Court, the trial court
directed the surviving plaintiff to amend the
complaint and when the latter failed to comply
therewith, the said court dismissed the complaint for
such non-compliance. We must hold, therefore, as
We did in Barrameda that inasmuch as there was no
obligation on the part of the plaintiff-appellant herein
to amend his complaint in Civil Case No. 261, any
such imposition being void, his failure to comply
with such an order did not justify the dismissal of his
complaint. Grounded as it was upon a void order, the
dismissal was itself void.
Consequently, as the dismissal of Civil Case No. 261
was void, it clearly may not be asserted to bar the
subsequent prosecution of the same or identical
claim.
Finally, We find ourselves unable to share the
appellees' view that the appellant's complaint under
Civil Case No. 780 failed to state a sufficient cause of
action. A cause of action is an act or omission of one
party in violation of the legal right or rights of the
other (Ma-ao Sugar Central vs. Barrios, 79 Phil. 666)
and both these elements were clearly alleged in the
aforesaid complaint.
Insofar as the issue of prescription is concerned, this
Court is of the view that it should defer resolution on
it until after Civil Case No. 780 shall have been tried
on the merits, considering that one of the defenses set
up by the appellant against the said issue is the
existence of a trust relationship over the property in
dispute.
G.R. No. L-4227 January 28, 1952
JOSE BARRAMEDA, DOLORES B. MAGADIA,
and JULIAN BARRAMEDA, JR., plaintiffs-
appellees,
vs.
PAULINO BARBARA and MARELA
BARBARA, defendants-appellants.
Jose M. Peña for appellees.
Serafin and Abad for appellants.
JUGO, J.:
The facts of this case as gathered from the decision of
the Court of first Instance of Camarines Sur, may be
summarized as follows:
In the case entitled Paulino Barbara and Marcela
Barbara vs. Julian Barrameda, Civil Case No R-119
of said court, Paulino and Marcela Barbara
(defendants-appellants herein) filed a complaint
against Julian Barrameda (deceased father of the
herein plaintiffs-appellees), alleging that Barrameda
refused to allow the redemption of the land in
question herein, which according to them had been
mortgaged to Barrameda for the sum of P270, the
original mortgagor and mortgagee being Jacoba
Buyet and Juan Reis, respectively. Juan Reis assigned
his rights as mortgagee to Julian Barrameda. Jacoba
Buyet was succeeded by heirs Paulino and Marcela
Barbara. Julian Barrameda filed an answer alleging
that the transaction between him and Jacoba Buyet
was not a mortgage but a sale with pacto de retro and
that neither Jacoba Buyet nor heir heirs had redeemed
the land within the stipulated period of six years, and
consequently, he, Julian Barrameda, had become the
absolute owner of the property in question.
After the above pleadings had been filed and while
the case was pending hearing, the court, after being
informed that Julian Barrameda had died, ordered the
plaintiffs to amend their complaint so as to substitute
the legal representative of Julian Barrameda as
defendants. Although seven months had elapsed since
the plaintiffs were notified of said order, they had
failed to comply with it.
On May 7, 1947, counsel for the deceased defendant
Julian Barrameda filed a motion for dismissal on the
ground that in failing to file an amended complaint,
the plaintiffs in said case, R-119 (defendants-
appellants herein), showed lack of interest in
prosecuting the case. The court granted the motion,
dismissing the case in its order dated May l3, l947.
The plaintiffs herein, Jose and Julian Barrameda, Jr.,
and Dolores B. Magadia, heirs of Julian Barrameda,
filed a complaint, dated August 26, l947, in the
present case, No. 843 of the Court of First Instance of
Camarines Sur, against Paulino and Marcela Barbara
(plaintiffs in case No. R-119), alleging the facts
above stated, and praying that they declared the
owners of the property in question and that the
defendants be ordered to indemnify them in the sum
of P200 per annum as damages from May, 1947 until
the defendants should vacate the land.
The defendants herein Paulino and Marcela Barbara
filed an answer, alleging in substance, that the deed
which the plaintiff claim to be of sale with pacto de
reto was only of mortgage, which was null and void
because their deceased mother Jacoba Buyet, who
executed it, had no authority to do so, as the property
belonged exclusively to their deceased father Pascual
Barbara; that they had been in possession of the land
as owners for more than twenty years. The answer of
the defendants ends with the prayer that the
document in question be declared null and void; that
if it is declared valid, it be considered only as a
mortgage of guaranty of one-half of the property in
question; and that they be ordered to pay to the
plaintiffs only half of the sum of P270 with costs
against the plaintiff.
The plaintiffs in the present case filed a motion
entitled "Motion to Dismiss the Counterclaim of the
Defendants and Render Judgment in accordance with
the Allegations in the Complaint," based on the
grounds:
1. That the cause of action stated in said
counterclaim is barred by prior judgment.
2. That the said counterclaim states no cause
of action.
3. That the answer does not allege any valid
defense.
The trial court, without receiving evidence and
rejecting the allegations of the answer of the ground
that the prior dismissal under Rule 30, section 3, was
a final adjudication on the merits, rendered judgment
in the present case declaring the plaintiffs owners of
the land in question and ordering the defendants in
the present case to deliver the possession to the
plaintiffs, and to pay the costs.
The defendants herein appealed to the Court of
Appeals which considering that all the questions
raised are of law and not, of fact, certified the present
case to this Court, which accepted it.
The order for dismissal for failure to prosecute in the
other case, No. R-119, was based on the failure of the
plaintiffs to comply with the order of the court to
amend the complaint so as to substitute as defendants
the heirs or representative of the deceased defendant
Julian Barrameda.
Rule 3, section 16, reads as follows:
Duty of attorney upon death or incapacity of
the party. — When ever a party to a pending
case dies or becomes insane, it shall be the
duty of his attorney to inform the court
promptly of such death or insanity and to
give the name and residence of the executor
or administrator, guardian, or the legal
representatives of the deceased or insane.
Section 17 of the same rule, reads as follows:
Death of party. — After the party dies and
the claims is not thereby extinguished, the
court shall order, upon proper notice, the
legal representative of the deceased to
appear and to be substituted for the
deceased, within a period of thirty (30) days,
or within such time as may be granted. If the
legal representative fails to appear within
said time, the court may order the opposing
party to procure the appointment of a legal
representative of the deceased within a time
to be specified by the court, and the
representative shall immediately appear for
and on behalf of the interest of the deceased.
The court charges involved in procuring
such appointment, if defrayed by the
opposing party, may be recovered as costs.
The heirs of the deceased may be allowed to
be substituted for the deceased, without
requiring of an executor or administrator and
the court may appoint guardian ad litem for
the minor heirs.
It will be seen that it was the duty of the attorney for
the deceased Julian Barrameda to inform the court of
Barrameda's death and furnish it with the name and
residence of the executor, administrator, guardian, or
legal representative of the deceased. The attorney of
the deceased or somebody else, who does not appear
of record, may have informed the court of the death
of Julian Barrameda, but said attorney did not furnish
the name and residence of the executor,
administrator, guardian, or legal representative of the
deceased client, in accordance with section 16, Rule
3, above quoted. This rule must have taken into
consideration the fact that the attorney for the
deceased party is in a better position than the attorney
of the other party to ascertain who are the legal
representatives or heirs of his deceased client. This
duty should not be shifted to the plaintiff or his
attorney. As a consequence of section 16, the court,
under section 17, orders the legal representative of
the deceased party, whose name must have been
furnished before hand by his attorney, to appear and
substitute the deceased within thirty days. It is only
after the failure of the legal representative to comply
with said order that the court, under section 17, will
order the opposing party to procure the appointment
of a legal representative within the time to be
specified by the court, to appear in behalf of the
interest of the deceased party. It should be understood
that under section 17, the heirs of the deceased may
appear instead of an executor or administrator, with
guardian ad litem for the minor heirs. In the present
case, although the attorney for the deceased
Barrameda did not furnish the name of the legal
representative of his deceased client, the court
directly ordered the plaintiffs to make the substitution
without previously requiring the defendants to do so.
Consequently, the order of the court requiring the
plaintiffs to make the substitution without previously
ordering the attorney for the defendants to name the
legal representative and ordering the latter to appear,
was a violation of Rule 3, sections 16 and 17, and
was, therefore, void. The non-compliance with that
order could not be considered as failure to prosecute.
The fault of the defendants should not be attributed to
the plaintiffs, making the latter suffer the serious
consequences that are claimed to have ensued.
It is stated in the appealed decision:
. . . So on May 7, 1947, counsel for the
defendant Julian Barrameda filed a motion
for dismissal. . . .
On May 7, 1947, Julian Barrameda was already dead.
How could the attorney represent him in finding the
motion? Julian Barrameda, being dead, had no longer
any standing in court; he had no personality and
could not have been represented by an attorney. But
if it had been the heirs of the deceased Barrameda
who were represented in filing the motion to dismiss
(which was not so), then instead of filing a motion for
dismissal they should have appeared as defendants in
lieu of the deceased Julian Barrameda. If they had
appeared in court to file a motion for dismissal, they
could and should have appeared as defendants as it
was their duty to do under sections 16 and 17 of Rule
3, without shifting this duty to the plaintiffs.
In view of the foregoing, the decision appealed from
is set aside and the case is ordered returned to the
trial court for further and appropriate proceedings,
with costs against the appellees. It is so ordered.
Paras C.J., Pablo, Bengzon, Padilla, Montemayor,
Reyes and Bautista Angelo, JJ., concur.
Separate Opinions
TUASON, J., concurring:
I concur and my concurrence is based on the fact that
the dismissal of the action in Civil Case No. R-119
did not bar the plaintiffs, in that case, from renewing
that action or using the grounds of that action as a
defense or cross-claim in a subsequent suit. Case No.
R-119 when dismissed was not in a state to be
decided on the merits and the court had no
jurisdiction in that case beyond that of dismissing it,
irrespective of whether the order to the plaintiffs to
make a substitution of party defendant was or was not
in accordance with the prescribed procedure.
G.R. No. L-41107 February 28, 1979
AMANDA L. VDA. DE DELA CRUZ, ET
AL., petitioners,
vs.
HON. COURT OF APPEALS, MARCELO
ABAGA MARGARITA D. JOSE, MARGARITA
D, JOSE, QUIRINO D, JOSE, TEOFILO D.
JOSE, ET AL. respondents.
Angel C Ungson Jr. for petitioner.
Juan J. de Dios and Simplicio M. Sevilleja for private
respondents.
DE CASTRO, J.:
This is a petition for certiorari king to review the
decision of the Court of Appeals in case CA-G.R.
No. 47331-R entitled "Amanda L. Vda. de dela Cruz,
et al, plaintiffs-appellees, versus Marcelo Abaga
Margarita D. Jose, et al., defendants." The questioned
decision ordered the setting aside of the decision
rendered by the Court of Agrarian Relations in CAR
Case No. 115-TP-59 and 116-TP-59 and proceedings
subsequent thereto insofar as it affected the deceased
defendant Felix Jose or his heirs, the private
respondents in this petition.
As narrated by the Court of Appeals in its decision, it
appears that plaintiffs (herein petitioners) filed an
action for ejectment and collection of unpaid rentals
against Felix Jose and 114 other tenants on
November 23, 1959 in the Court of Agrarian
Relations, Tayug, Pangasinan. Their complaint
alleged that Felix Jose is a tenant over a 4.5 ha.
landholding in plaintiffs' hacienda in Tayug
Pangasinan, paying a fixed rental of 850 kilos of
palay per hectare per agricultural year, that he failed
to pay in full his rentals and despite plaintiffs'
repeated demands, Felix Jose to vacate the land-
holding and to pay his obligation. 1 In a join answer
through their counsel Atty. Fausto G. Cabotaje,
defendant Felix Jose and his 114 co-defendants
denied the material averments of the complaint,
alleging payment of all the rentals of their respective
landholdings. Thereafter, trial was commenced.
However, as found by the Court of Appeals, "before
termination thereof, or on June 5, 1961, Felix Jose
died at the Eastern Pangasinan Provincial General
Hospital in Tayug, Pangasinan (Record, Vol. 1, p.
509). It appears that Jose's demise, no substitution of
defendant was effected. 2
Then on March 29, 1962, the trial court rendered
judgment against Felix Jose together with the other
defendants holding him liable to plaintiffs for 6,432
kilos of palay as unpaid rentals. Some of his co-
defendants then brought the case to the Supreme
Court for review on certiorari where it was docketed
as G. R. No. L-19930-19935. However, the petition
was dismissed on November 30, 1962 due to the
petitioners' failure to file their brief (Appellee's Brief,
pp. 2-8). Thereafter, on plaintiffs' motion, the Court
of Agrarian Relations issued an order of execution
(Appendix B of Appellant's Brief, pp. 54-60). On
May 3, 1963, a writ of execution to effect ejectment
was entered (Appendix C, Appellants' Brief, pp. 60-
69). To satisfy the award of damages under the
decision of the Court of Agrarian Relations, the
conjugal properties of the deceased Felix Jose and his
wife were sold at public auction. A certificate of sale
dated July 31, 1969 was later issued in favor of
plaintiff Amanda L. Vda. de dela Cruz as highest
bidder. The sheriff's final deed of sale followed on
August 17, 1970.
On October 27, 1970, the heirs of the deceased
defendant, through their new counsel, Atty. Juan V.
Landingin, filed a motion to substitute the deceased
and to set aside as null and void the decisions, orders,
writ of execution and sale at public auction made and
entered against the latter. The trial court allowed the
substitution "for the purposes of whatever
proceedings may still be allowed in this case" (p. 23,
rollo) but denied the motion to set aside the decision,
orders, writ of execution and the public auction sale.
The motion for reconsideration was likewise denied.
The substituted defendants then appealed to the Court
of Appeals, raising mainly the question of the validity
of the lower court's decision on the ground that
despite it's awareness of the death of said defendant,
no substitution was ordered before decision was
rendered on March 29, 1962.
The Court of Appeals found the appeal meritorious.
Against its decision, a motion for reconsideration was
filed but was denied. Hence, this petition for review
on certiorari, alleging mainly that the Court of
Appeals erred: 3
1. in entertaining an appeal from
the order of the Court of Agrarian
Relations, in reversing the decision
of the Court of Agrarian Relations
of March 29, 1962, setting aside the
same and the auction sale of July 2,
1969, the certificate of sale dated
July 31, 1969, and the final deed of
sale of August 17, 1979," with
respect to Felix Jose, considering
that a period of more than eight (8)
years had elapsed from the
rendition of the decision of the trial
court to the filing of the motion for
substitution:
2. in not considering the decision of
the Supreme Court in cases G.R.
Nos. L-19930-19935 as having the
effect of res judicata, based not
only on the general application of
the Rule but on the basis of the
agreement of the parties before the
Court of Agrarian Relations that
the cases be heard jointly and one
decision for all the cases is
sufficient;
3. in finding that the trial was still
going on and not yet terminated
when Felix Jose died on June 5,
1961, and that the continuance of
the trial after the death of
defendant, without each party
having been substituted in
accordance with the aforesaid Rule
amounts to lack of jurisdiction.
To begin with, the Court of Appeals found that the
defendant Felix Jose died before the termination of
the trial, contrary to petitioner's claim that when d
defendant died, the trial was already terminated (p.
11, rollo) and hence, there was no denial of due
process. Whether defendant died before or after
termination of trial is not all that important because
one thing is certain; that he died before the rendition
of judgment. This fact was known to the judge of the
Court of Agrarian Relations (Appellant's Brief, pp.
48-49), who in his decision placed the word "dead" in
parenthesis beside the name of Felix Jose (Appendix
A, Appellants' Brief, p. 49). The Court of Appeals
took this into consideration when it held that the
decision of said court was a "patent nullity" insofar as
Felix Jose was concerned. As stated by the Appellate
Court, no substitution of the deceased was ordered by
the trial court, in disregard of the provisions of Rule
3, Sec. 17, Rules of Court which reed thus:
SEC. 17. Death of a party. After a
party dies and the claim is not
thereby extinguished, the court
shall order, upon proper notice, the
legal representative of the deceased
to appear and to be substituted for
the deceased within a period of
thirty (30) days, or within such
time as may be granted. If the legal
representative fails to appear within
said time, the court may order the
opposing party to procure the
appointment of a legal
representative of the deceased
within a time to be specified by the
court, and the representative shall
immediately appear for and on
behalf of the interest of the
deceased. The court charges
involved in procuring such
appointment, if defrayed by the
opposing party, may be recovered
as costs. The heirs of the deceased
may be allowed to be substituted
for the deceased, without requiring
the appointment of an executor or a
administrator and the court may be
appoint guardian ad litem for the
minor heirs.
In Caseñas vs. Resales (19 SCRA 466). Caisip vs.
Cabangon (109 Phil. 154) and Bonilla vs.
Barcena (71 SCRA 495), this Court held that in case
of the death of a party and due notice is given to the
trial court, it is the duty of the court to order the legal
representative of the deceased to appear for him in
the manner outlined in the aforementioned Rule.
Considering that the complaint was for ejectment of
the tenants, (defendant, being one of them) the
provisions of said section and the rulings in the
aforementioned cases are indeed applicable to the
present case, where the action or the claim is not
extinguished on account of Section 9, RA 1199, (now
RA 6389, Code of Agrarian Reforms) which provides
in effect that in case of death or permanent incapacity
of the agricultural lessee, the leasehold shall continue
between the lessor and the persons enumerated in
said Section which include the descendants of the
deceased. But as noted by the Court of Appeal: 4 it
appears that no legal representative was ever
summoned to appear in court; that no legal
representative appeared to be substituted, and that
plaintiffs did not procures the appointment of such
legal representatives." As a result the "continuance of
a proceeding during the pendency of which a party
thereto dies, without such having been validly
substituted in accordance with the rules, amounts to
lacks of jurisdiction." 5 The same ruling was given in
the earlier case of Ferreria vs. Gonzales (104 Phil
143), where this Court set aside the decision of the
Court of Agrarian Relations because "no valid
substitution was effected, consequently, the court
never acquired jurisdiction over appellant for the
purpose of making the decision binding upon her
either personally or as legal representative of the
estate of her deceased mother." Assuming that
jurisdiction was ever acquired at the outset over
defendant Felix Jose, it was:
inevitably impaired on the death of
the protestee pending the
proceedings below such that unless
and until a legal representative is
for him duly named and within the
jurisdiction of the trial court, no
adjudication in the cause could
have been accorded any validity or
binding effect on any party, in
representation of the deceased,
without trenching upon the
fundamental right to a day in court
which is the very essence of the
constitutionally enshrined
guarantee of due process. 6
The need therefore for substitution is based on the
right of a party to due process. Summing up then the
previous ruling of this Court in the afore-cited cases,
and noting that Rule 3, Sec. 17, Revised Rules of
Court uses the word "shall", one infers that
substitution is indeed a mandatory requirement in
actions surviving the deceased. It has been held that
in "statutes relating to procedure ... every act which is
jurisdictional or of the essence of the proceedings or
is prescribed for the protection or benefit of the party
affected, is mandatory." 7 The petitioners, however,
take the contrary view, pointing to the case of Lota
vs. Tolentino (90 Phil. 831) to argue that the said
section involves only a procedural requirement
(Petitioners' Brief, p. 16). A reading of the said case
shows that the nature of the action filed by the
plaintiff was purely personal since it was for
accounting and liquidation of the partnership, and on
defendant's death, the claim was extinguished.
In any case, substitution should be ordered even after
judgment has been rendered since proceedings may
still be taken as was done in this case — like an
execution; and the legal representative must appear to
protect the interests of the deceased and in all such
proceedings. 8 In this instance, however, the Court of
Appeals found that there is "no showing that the
appellant's were notified of the decision dated March
29, 1962 or of the auction sale held
thereafter.9 Petitioners take issue with the Appellate
Court on this point. But since the present petition is
for review on certiorari, where "only questions of law
may be raised," (R. 45, Sec. 2, Revised Rules of
Court), this Court has held in a number of cases that
findings of facts by the Court of Appeals are; in
general, final and conclusive (Chan vs. Court of
Appeals, 33 SCRA 737; Ramirez Te. Corp. vs. Bank
of America, 32 SCRA 191; Castro vs. Tamporong 78
Phil. 804 to name a few), except when: 10
1 the conclusion is a finding
grounded entirely on speculation,
2 the inference made is manifestly
mistaken, absurd or impossible;
3 there is a grave abuse of
discretion
4 the judgment is based on a
misapprehension of facts;
5 the Court of Appeals is making
its findings, went beyond the issues
 of the case and the same are
contrary to the submission of both
appellant and appellee.
None of the above exceptions however applies to the
case at bar, so there is no reason to disturb the
findings of the Court of Appeals.
Petitioners also contend that since two of the private
respondents were co-respondents with their father in
the complaint before the Court of Agrarian Relations,
petitioners "believe that they were supposed to have
represented their father in the appeal to the Supreme
Court. "Likewise, they maintain that the decision of
the Court in the said appeal operated as res
judicata on all matters which might have been
litigated and decided before the judgment became
final (pp. 79, rollo).
With reference to the first objection, it is worthy to
note that the herein private respondents were sued in
their individual capacity for their separate and
respective obligations. The dismiss of he appeal by
the Supreme Court for failure of the petitioners to file
their brief or memorandum within the prescribed
period could not, therefore, bar the heirs of the
deceased from questioning all the proceedings
particularly if the fact is considered that there could
not have been a final judgment on the merits since in
the first place, jurisdiction over the deceased
defendant was lacking in the lower court, as
heretofore shown. Accordingly there can be no res
judicata as contended by petitioner.11
IN VIEW OF THE FOREGOING, We hereby affirm
the decision of the Court of Appeals, No
pronouncement as to costs.
SO ORDERED.
G.R. Nos. L-42699 to L-42709 May 26, 1981
THE HEIRS OF THE LATE FLORENTINA
NUGUID VDA. DE HABERER, petitioner,
vs.
COURT OF APPEALS, ** FEDERICO
MARTINEZ, BALDOMERO MANALO,
FAUSTINO BAGALAWIS, FEDERICO STA.
TERESA, ANGELITO KING, GREGORIO DEL
ROSARIO, LEODOVICO TORRES, LEON
SORIANO, SANTIAGO TUMANG, LUIS
PASTOR and CRISTINO
LIBRAMANTE, respondents.
TEEHANKEE, J.:1äwphï1.ñët
The Court grants the petition for review by way of
appeal from the Resolutions of respondent Court of
Appeals dated November 24, 1975 and January 15,
1976 dismissing the appeal of the late Florentino
Nuguid Vda. de Haberer in CA-G. R. No. 53680—
90-R and ordering all pleadings filed in said cases
after the death of said appellant stricken off the
records, for having been issued with grave error of
law if not with grave abuse of discretion and remands
the case for proper proceedings and determination of
the appeal on the merits.
This case originated from the Court of First Instance
of Rizal where the late Florentina Nuguid Vda. de
Haberer as the duly registered owner filed in 1964
and 1965 (11) complaints for recovery of possession
of the parcel of land evidenced by Transfer
Certificate of Title No. 15043 of the Register of
Deeds of Rizal issued in her name, situated at
Mandaluyong, Rizal, alleging that private
respondents had surreptitiously entered the land and
built their houses thereon.
The lower court, after trial on the merits, rendered a
consolidated decision, dated May 26, 197 l,
dismissing all the complaints. On motion of the late
Florentina Nuguid Vda. de Haberer the cases were
reopened and retried on grounds of newly discovered
evidence. On September 15, 1972, the lower court
issued an order reviving its decision of May 26, 1971.
The decision was thus appealed to the Court of
Appeals.
In the Court of Appeals, the cases were erroneously
dismissed once before, on the ground that the appeal
was allegedly filed out of time. The issue was
brought to this Court in Cases Nos. L-39366 and L-
39620-29, entitled "Florentina Nuguid Vda. de
Haberer vs. Federico Martinez, et al., 1 On January
29, 1975, this Court rendered its judgment setting
aside the appellate court's dismissal of the appeal and
ordering the reinstatement of the same for proper
disposition on the merits, having found "that contrary
to respondent court's erroneous premises and
computation, petitioner duly and timely perfected her
appeal within the reglementary period and in
compliance with the material data rule requiring that
the Record on Appeal state such data as will show
that the appeal was perfected on time. "
The cases were remanded to the Court of Appeals
where appellant was required to file printed brief
within forty-five days from her receipt of notice.
Three days before the period was to expire, or on
June 18, 1975, appellant's counsel requested for an
extension of time within which to file appellant's
brief. Respondent court in a resolution dated June 23,
1975 granted the request and gave appellant a 90-day
extension (with warning of no further extension)
from receipt on June 27, 1975 or up to September 25,
1975 within which to file the appellant's printed brief.
On June 23, 1975, private respondent opposed the
extension by filing a "Motion to Set Aside Order
Granting Extension of Time to File Brief." Appellant
was directed by respondent court to comment on the
said opposition and appellant's counsel complied by
submitting its comments on July 15, 1975.
In the meantime, appellant Florentina Nuguid Vda.
de Haberer had died on May 26, 1975. Appellant's
counsel Attorneys Bausa, Ampil and Suarez
accordingly gave respondent court notice of the death
of their client in their motion of June 28, 1975 and
asked for the suspension of the running of the period
within which to file the appellant's brief pending the
appointment of an executor of the estate left by their
client in the Court of First Instance of Quezon City
(Sp. Proc. No. Q-2026) where a petition for the
probate of the alleged will of the deceased had been
filed by another lawyer, Atty. Sergio Amante.
Respondents in turn contended that the lawyers of he
deceased had "no longer any legal standing and her
atorneys could no longer act for and in her behalf for
the reason that their client-attorney relationship had
been automatically erminated or severed" and asked
that the appeal be dismissed for failure to
prosecute." 2
Since their motion of June 28, 1975 remained
unacted upon and the original extension granted by
the respondent court for the deceased appellant to file
her printed brief was about to expire, her counsel
filed on September 18, 1975 a manifestation and/or
motion asking either for an extension of sixty (60)
days and/or resolution suspending the running of the
period within which to submit appellant's printed
brief. Still, respondent, court remained silent.
Not certain whether their services would still be
retained by the heirs of the deceased, counsel for the
late Florentina Nuguid Vda. de Haberer reiterated
their request in a motion dated November 14, 1975
either for an extension of time to file appellant's brief
or for the issuance of a resolution suspending the
running of the period for filing the same, pending the
appointment of an administrator or executor of the
estate of the deceased appellant.
Finally, acting on counsel's motion of November 14,
1975, respondent court denied the request for
extension and at the same time dismissed the appeal,
ruling in its resolution dated November 24, 1975 as
follows:1äwphï1.ñët
Upon consideration of the
manifestation and/or for another
extension to file appellant's brief
dated November 14, 1975, filed by
counsel for the appellant on the
grounds therein stated, and
considering that appellant has
already been given a total of one
hundred ninety-five (195) days
within which to file brief, the Court
Resolved to deny the motion for
another extension to file brief and
to dismiss the appeal.
Counsel for the deceased appellant forthwith filed
their urgent motion for reconsideration of December
8, 1975 explaining their predicament that the requests
for extension/suspension of period to file brief was
due to the uncertainty that their services may no
longer be retained by the heirs or legal
representatives of their deceased client but they felt
obligated to preserve the right of such
heirs/successors to continue the appeal pursuant to
Rule 3, Section 17 of the Rules of Court, pending the
settlement of the question of who among them should
be the executor of the deceased's estate and presented
therewith, for admission, the printed "brief for the
appellant" the printing of which they had deferred
"for professional ethical considerations," pending
respondent court's action on their request for
suspension of the period. They further submitted
therewith copies of 2 separate orders of September 3,
1975 and August 26, 1975 issued by the Court of
Agrarian Relations and the Court of First Instance
both at Guimba, Nueva Ecija, respectively, wherein
the deceased Florentina Nuguid Vda. de Haberer was
party-defendant, granting the deceased's counsel's
prayer to hold in abeyance further proceedings
therein pending the appointment of an administrator
for the estate of the deceased.
Respondent court, however, denied reconsideration,
per its Resolution of January 15, 1976 citing the
general principle that "litigants have no right to
assume that such extensions will be granted as a
matter of course." But respondent court erred in
applying this general principle and summarily
denying reconsideration and denying admission of
the appellant's brief conditioned upon the
administrator of the deceased's estate making his
appearance upon his appointment and being granted
leave to file his supplemental brief/memorandum, 3 in
view of the intervening event of appellant's death and
the interposition of the equally established principle
that the relation of attorney and client is terminated
by the death of the client, as acknowledged by
respondent court itself as well as respondents. ln the
absence of a retainer from the heirs or authorized
representatives of his deceased client, the attorney
would thereafter have no further power or authority
to appear or take any further action in the case, save
to inform the court of the client's death and take the
necessary steps to safeguard the deceased's rights in
the case.
This is what the deceased's counsel did in the case at
bar. They properly informed respondent court of the
death of the appellant and sought suspension of the
proceedings and of the period for filing appeliant's
brief pending the appointment of the executor of the
deceased's estate in the proper probate proceedings
filed with the Court of First Instance of Quezon City.
Section 17, Rule 3 of the Rules of Court 4 sets the
rule on substitution of parties in case of death of any
of the parties. Under the Rule, it is the court that is
called upon, after notice of a party's death and the
claim is not thereby extinguished, to order upon
proper notice the legal representative of the deceased
to appear within a period of 30 days or such tlnie as it
may grant. Since no administrator of the estate of the
deceased appellant had yet been appointed as the
same was still pending determination in the Court of
First Instance of Quezon City, the motion of the
deceased's counsel for the suspension of the running
of the period within which to file appellant's brief
was well-taken. More, under the Rule, it should have
set a period for the substitution of the deceased party
with her legal representative or heirs, failing which,
the court is called upon to order the opposing party to
procure the appointment of a legal representative of
the deceased at the cost of the deceased's estate, and
such representative shall then "immediately appear
for and on behalf of the interest of the deceased."
Respondent court gravely erred in not following the
Rule and requiring the appearance of the legal
representative of the deceased and instead dismissing
the appeal of the deceased who yet had to be
substituted in the pending appeal. Thus, it has been
held that when a party dies in an action that survives,
and no order is issued by the court for the appearance
of the legal representative or of the heirs of the
deceased in substitution of the deceased, and as a
matter of fact no such substitution has ever been
effected, the trial held by the court without such legal
representatives or heirs and the judgment rendered
after such trial are null and void because the court
acquired no jurisdiction over the persons of the legal
representatives or of the heirs upon whom the trial
and the judgment would be binding. 5
Respondent court therefore erred in ruling that since
upon the demise of the party-appellant, the attorney-
client relationship between her and her counsels "was
automatically severed and terminated," whatever
pleadings filed by said counsel with it after the death
of said appellant "are mere scraps of paper." 6 If at
all, due to said death on May 25, 1975 and severance
of the attorney-client relationship, further
proceedings and specifically the running of the
original 45-day period for filing the appellnt's brief
should be legally deemed as having been
automatically suspended, until the proper substitution
of the deceased appellant by her executor or
administrator or her heirs shall have been effected
within the time set by respondent court pursuant to
the cited Rule.
Respondent court likewise gravely erred in
dismissing the appeal on "(its) belief that the
supervening death of the appellant Florentina Nuguid
Vda. de Haberer rendered the continuance of the
appeal unnecessary" on the basis of a totally
inapplicable citation of a ruling in Velasco vs.
Rosenberg, 29 Phil. 212, 214 that "If pending appeal,
an event occurs which renders it impossible for the
appellate court to grant any relief, the appeal will be
dismissed." Manifestly, the appenant's death in no
way impedes that the deceased's appeal to recover the
parcel of land registered in her name be continued
and determined for the benefit of her estate and heirs.
Prescinding from the foregoing, justice and equity
dictate under the circumstances of the case at bar that
the rules, while necessary for the speedy and orderly
administration of justice, should not be applied with
the rigidity and inflexibility of respondent court's
resolutions. 7 What should guide judicial action is the
principle that a party litigant is to be given the fullest
opportunity to establish the merits of his complaint or
defense rather than for him to lose life, liberty, honor
or property on technicalities. 8 A liberal, rather than a
strict and inflexible adherence to the Rules, is
justified not only because appellant (in this case, her
estate and/or heirs) should be given every opportunity
to be heard but also because no substantial injury or
prejudice can well be caused to the adverse parties
principally, since they are in actual possession of the
disputed land. 9 The better and certainly the more
prudent course of action in every judicial proceeding
is to hear both sides and decide on the merits rather
than dispose of a case on technicalities, 10 especially
where no substantial prejudice is caused to the
adverse party. 11
The dismissal of an appeal based on the appellant's determination of the appeal on the merits. With costs
failure to file brief is based on a power granted to against private respondents.
respondent Court of Appeals and not on a specific The Court has noted that upon recommendation of
and mandatory duty imposed upon it by the the Solicitor General in Adm. Case No. 2148
Rules. 12 Since the power or authority is not entitled "Francisco Ortigas, Jr., et al. vs. Atty. Felipe
mandatory but merely directory, the exercise thereof C. Navarro" that counsel for respondents Felipe C.
requires a great deal of circumspection, considering Navarro be disbarred for "gross misconduct and/or
all the attendant circumstances. 13 The failure of an malpractice," he has been suspended from the
appellant to file his brief within the time prescribed practice of law during the pendency of said
does not have the effect of dismissing the appeal proceedings. The Court, however, directs that copy of
automatically. 14 Rather, the Court of Appeals has the this decision be served on said counsel for the sole
discretion to dismiss or not to dismiss appellant's purpose of apprising private respondents through him
appeal, which discretion must be a sound one to be of the promulgation of this judgment and to require
exercised in accordance with the tenets of justice and respondents (1) to inform the Court of their new
fair play having in mind the circumstances obtaining counsel, if any, and to direct him to enter his
in each case. l5 appearance or (2) if they have no new or other
Paraphrasing what the Court stressed in the leading counsel, to inform the Court of their respective
case of Berkenkotter vs. Court of Appeals, 16 a addresses for purposes of service of the Court's
reading of the appellant's brief discloses that processes, within ten (10) days from notice hereof.
petitioners-appellants have a prima facie meritorious Makasiar, Guerrero, De Castro **and Melencio-
case which should be properly determined on the Herrera, JJ., concur.1äwphï1.ñët
merits and "the element of rigidity should not be
affixed to procedural concepts and made to cover the
matter," 17 for to dismiss the appeal would not serve
the ends of justice.
A final note: On March 19, 1976, counsels submitted
with their Manifestation the written authority dated
January 20, 1976 individually signed by instituted
heirs and/or legal representatives of the testate estate
of the deceased Florentina Nuguid Vda. de Haberer
granting said counsels full authority to file and
prosecute the case and any other incidental cases for
and in their behalf, 18 which was duly noted in the
Court's Resolution of March 26, 1976. Such
manifestation and authority may be deemed the
formal substitution of the deceased by her heirs, as in
fact they appear as petitioners in the title of the case
at bar. Hence, the proper determination of the
pending appeal may now proceed, as herein directed.
ACCORDINGLY, the petition is granted and
respondent court's resolutions of November 24, 1975
and January 15, 1976 are set aside. The appellant's
brief filed with respondent court in the pending
appeal in CA-G.R. Nos. 53680-90-R is ordered
admitted and the cases are remanded to respondent,
Court of Appeals for further proceedings and proper
G.R. No. L-45809 December 12, 1986
SOCORRO SEPULVEDA LAWAS, petitioner,
vs.
COURT OF APPEALS, HON. BERNARDO LL.
SALAS, [as Judge, CFI, Cebu, Branch VIII], and
PACIFICO PELAEZ, respondents.
Jesus Yray for petitioner.
Teodoro Almase for respondents.
FERIA, J.:
This is an appeal by certiorari under Rule 45 of the
Revised Rules of Court from the decision of the
Court of Appeals which dismissed the petition for
certiorari under, Rule 65 of said Rules against
respondent Judge Bernardo L. Salas of the Court of
First Instance of Cebu. The antecedent facts are
briefly as follows:
Private respondent Pacifico Pelaez filed a Complaint
on December 6, 1972 against petitioner's father,
Pedro Sepulveda, for ownership and partition of
certain parcels of land. Defendant Pedro Sepulveda
filed his Answer dated December 31, 1972 resisting
the claim and raising the special defenses of laches,
prescription and failure to ventilate in a previous
special proceeding. During the presentation of
evidence for the plaintiff, the defendant died on
March 25, 1975. On May 21, 1975, counsels for the
deceased defendant filed a notice of death wherein
were enumerated the thirteen children and surviving
spouse of the deceased.
On May 5, 1975, petitioner filed a petition for letters
of administration and she was appointed judicial
administratrix of the estate of her late father in July,
1976.
At the hearing of the case on November 27, 1975,
Attys. Domingo Antigua and Serafin Branzuela,
former counsels for the deceased defendant,
manifested in open court that with the death of their
client, their contract with him was also terminated
and none of the thirteen children nor the surviving
spouse had renewed the contract, but instead they had
engaged the services of other lawyers in the intestate
proceedings.
Notwithstanding the manifestation of the former
counsels of the deceased defendant, the respondent
trial judge set the case for hearing on January 13,
1976 and sent the notice of hearing to said counsels.
On January 13, 1976, the respondent trial judge
issued three orders. The first order substituted the
heirs of the deceased defendant, namely, his thirteen
children and surviving spouse, as defendants; the
second order authorized Atty. Teodoro Almase,
counsel for the plaintiff, to present his evidence in the
absence of Attys. Antigua and Branzuela and the
third order treated the case submitted for decision,
after the plaintiff had presented his evidence and
rested his case, and directed that said counsels and
the fourteen heirs of the deceased defendant be
furnished copies thereof.
On January 28, 1976, the respondent trial judge
rendered a decision against the heirs of the deceased
defendant.
On February 19, 1976, ten of the children of the
deceased defendant, who apparently did not know
that a decision had already been rendered, filed an
Answer in-substitution of the deceased defendant
through their counsel Atty. Jesus Yray. This was
denied admission by the respondent trial judge for
being already moot and academic because of the
earlier decision.
On March 9, 1976, the widow and two other children
of the deceased defendant, through their counsel
Atty. Delfin Quijano, filed a motion for substitution
and for reconsideration of the decision dated January
28, 1976. On April 7, 1976, the respondent trial judge
issued an order setting aside his decision and setting
the case in the calendar for cross-examination of the
plaintiff, Pacifico Pelaez, with a proviso that said
order was applicable only to the three heirs who had
filed the motion. On July 14, 1976, the respondent
trial judge lifted the order setting aside his decision,
despite the verbal petition for postponement of the
hearing made by one of the three heirs on the ground
of the absence of their counsel.
On July 9, 1976, petitioner, who had been appointed
judicial administratrix of the estate of the deceased
defendant and who was one of the heirs who had
filed an Answer on February 19, 1976, filed a motion
to intervene and/or substitute the deceased defendant.
On August 25, 1976, the respondent trial judge
denied the motion for the reason that the decision had
already become final.
Petitioner then filed a special civil action of certiorari
with the Court of Appeals to annul the proceedings in
the respondent trial court. However, the Court of
Appeals dismissed the petition for certiorari. Hence,
the present appeal.
The appeal is meritorious.
Section 16 of Rule 3 provides as follows:
Duty of attorney upon death, incapacity, or
incompetency of party. — Whenever a party
to a pending case dies, becomes
incapacitated or incompetent, it shall be the
duty of his attorney to inform the court
promptly of such death, incapacity or
incompetency, and to give the name and
residence of his executor, administrator,
guardian or other legal representative.
The former counsels for the deceased defendant,
Pedro Sepulveda, complied with this rule by filing a
notice of death on May 21, 1975. They also correctly
manifested in open court at the hearing of the case on
November 27, 1975, that with the death of their client
their contract with him was also terminated and none
of the heirs of the deceased had renewed the contract,
and the heirs had instead engaged the services of
other lawyers in the intestate proceedings.
Both the respondent trial judge and the Court of
Appeals erred in considering the former counsels of
the deceased defendant as counsels for the heirs of
the deceased. The statement in the decision of the
Court of Appeals that "the appearance of the lawyers
of their deceased father in court on January 13, 1976
(Annex K) carries the presumption that they were
authorized by the heirs of the deceased defendant" is
erroneous. As this Court held in People vs. Florendo
(77 Phil. 16), "the attorneys for the offended party
ceased to be the attorneys for the deceased upon the
death of the latter, the principal. " Moreover, such a
presumption was not warranted in view of the
manifestation of said lawyers in open court on
November 27, 1975 that they were not representing
the heirs of the deceased defendant.
Consequently, when on the same date, November 27,
1975, the respondent trial judge issued an order
setting the continuation of the trial of the case on
January 13, 1976, with notices sent to Atty. Almase
for the plaintiff and Attys. Antigua and Branzuela for
the deceased defendant, he acted with grave abuse of
discretion amounting to excess of jurisdiction.
It was only at the hearing on January 13, 1976 that
the respondent trial judge issued an order substituting
the deceased defendant with his fourteen heirs. This
was followed with an order authorizing counsel for
the plaintiff to present his evidence in the absence of
Attys. Antigua and Branzuela, and lastly, an order
treating the case as submitted for decision.
In the order of the respondent trial judge dated
November 10, 1976, denying petitioner's motion for
reconsideration of the order denying her motion for
intervention (Annex 1 of the Comment), mention was
made of the delayed arrival of Attys. Antigua and
Branzuela at the hearing on January 13, 1976 and of
their being allowed to cross-examine the plaintiff
himself.
The refusal of said former counsels of the deceased
defendant to cross-examine the plaintiff was justified
— called upon, after notice of a party's death
... in view of the intervening event of
appellant's death and the interposition of the
equally established principle that the
relationship of attorney and client is
terminated by the death of the client, as
acknowledged by respondent court itself as
well as respondents. In the absence of a
retainer from the heirs or authorized
representatives of his deceased defendant
the attorney would have no further power or
authority to appear or take any further action
in the case, save to inform the court of the
client's death and take the necessary steps to
safeguard the decedent's rights in the case.
(Vda. de Haberer vs. Court of Appeals, May
26, 1981, 104 SCRA 534, 540)
Moreover, as above stated, petitioner had as early as
May 5, 1975 filed a petition for letters of
administration, and the same was granted in July,
1975.
Section 17 of Rule 3 provides as follows:
Death of party. After a party dies and the
claim is not thereby extinguished, the court
shag order, upon proper notice, the legal
representative of the deceased to appear and
to be substituted for the deceased, within a
period of thirty (30) days, or within such
time as may be granted. If the legal
representative fails to appear within said
time, the court may order the opposing party
to procure the appointment of a legal
representative of the deceased within a time
to be specified by the court, and the
representative shall immediately appear for
and on behalf of the interest of the deceased.
The court charges involved in procuring
such appointment, if defrayed by the
opposing party, may be recovered as costs.
The heirs of the de ceased may be allowed
to be substituted for the deceased, without
requiring the appointment of an executor or
administrator and the court may appoint
guardian ad litem for the minor heirs.
As this Court has held:
... Under the Rule, it is the court that is
and the claim is not thereby extinguished, to
order upon proper notice the legal
representative of the deceased to appear
within a period of 30 days or such time as it
may grant. Since no administrator of the
estate of the deceased appellant had yet been
appointed as the same was still pending
determination in the Court of First Instance
of Quezon City, the motion of the deceased's
counsel for the suspension of the running of
the period within which to file appellant's
brief was well-taken. More, under the Rule,
it should have set a period for the
substitution of the deceased party with her
legal representative or heirs, failing which,
the court is called upon to order the
opposing party to procure the appointment
of a legal representative of the deceased at
the cost of the deceased's estate, and such
representative shall then 'immediately
appear for and on behalf of the interest of
the deceased.
Respondent court gravely erred in not
following the Rule and requiring the
appearance of the legal representative of the
deceased and instead dismissing the appeal
of the deceased who yet had to be
substituted in the pending appeal Thus, it
has been held that when a party dies in an
action that survives, and no order is issued
by the court for the appearance of the legal
representative or of the heirs of the deceased
in substitution of the deceased, and as a
matter of fact no such substitution has ever
been effected, the trial held by the court
without such legal representatives or heirs
and the judgment rendered after such trial
are null and void because the court acquired
no jurisdiction over the persons of the legal
representatives or of the heirs upon whom
the trial and the judgment would be binding.
(Ordoveza vs. Raymundo, 63 Phil 275
[1936]; Obut vs. Court of Appeals, et al., 70
SCRA 546) (Vda. de Haberer vs. Court of
Appeals, supra, p. 541.
Under the said Rule, priority is given to the legal
representative of the deceased, that is, the executor or
administrator of his estate. It is only in cases of
unreasonable delay in the appointment of an executor
or administrator, or in cases where the heirs resort to
an extrajudicial settlement of the estate, that the court
may adopt the alternative of allowing the heirs of the
deceased to be substituted for the deceased.
In the case at bar, in view of the pendency of Special
Proceeding No. 37-SF Intestate Estate of Pedro
Sepulveda, and the pending application of petitioner
to be appointed judicial administratrix of the estate,
the respondent trial judge should have awaited the
appointment of petitioner and granted her motion to
substitute the deceased defendant.
While the lower courts correctly held that the death
of Pedro Sepulveda did not obliterate his verified
Answer to the Complaint filed by private respondent
and that the Answer filed by the ten heirs and the
Answer filed by the Administratrix were both
unnecessary, the said heirs or the administratrix
could, with leave of court, file an Amended Answer.
In view of the foregoing, the Court rules that the
proceedings conducted by the respondent trial judge
after the death of the deceased defendant are null and
void.
WHEREFORE, the decision of the Court of Appeals
is reversed; the petition for certiorari is granted;
petitioner is ordered substituted for the deceased
defendant, Pedro Sepulveda; and the proceedings
conducted by the respondent trial judge after the
death of the deceased defendant, including the
decision rendered by him on January 28, 1976, are set
aside; with costs against private respondent.
SO ORDERED.
G.R. No. 91879 July 6, 1992
HEIRS OF MAXIMO REGOSO, petitioners,
vs.
THE HON. COURT OF APPEALS and BELEN
CRUZ REGOSO, respondents.
GRIÑO-AQUINO, J.:
The heirs of Maximo Regoso seek a review of the
resolution dated October 9, 1989 of the Court of
Appeals in CA-G.R. No. 20183 dismissing the appeal
filed by Regoso's former counsel.
The case involves an action for judicial partition of
property with accounting and damages (Civil Case
No. 1464-V-81), which was filed by Belen Cruz-
Regoso against her husband, Maximo Regoso, in the
Regional Trial Court, Branch XV of Malolos,
Bulacan.
On November 14, 1988, the trial court rendered a
decision, the dispositive portion of which reads:
WHEREFORE, judgment is hereby
rendered in favor of the plaintiff
and against the defendant, as
follows:
1. Declaring the land situated at
Sampalukan, Calvario,
Meycauayan, Bulacan as
paraphernal of the plaintiff and the
building and improvement thereon
as conjugal property of the parties;
2. Declaring the properties situated
at Galas, Quezon City and
Echague, Isabela as conjugal
properties of the parties;
3. Requiring the defendant to
render an accounting of all income
derived from the aforementioned
properties; and
4. Adjudging the defendant to pay
the following amounts:
a) P5,000.00 as
moral damages;
b) P5,000.00 as
exemplary
damages; and
c) P5,000.00 as
attorney's fees.
With costs against the defendant.
(p. 25, Rollo.)
Regoso died on January 17, 1985 after the case had
been submitted for decision, but he was not
substituted as defendant by his heirs because,
apparently, the trial court was not informed of his
death until the decision had been promulgated on
November 14, 1988.
On November 29, 1988, Regoso's counsel, Attorney
Adriano Javier, Sr., filed a notice of appeal which the
trial court approved. The appeal was docketed in the
Court of Appeals as CA-G.R. No. 20183.
The plaintiff, Belen Cruz-Regoso, through counsel,
moved to dismiss the appeal on the ground that the
deceased defendant ceased to have legal personality
and that Attorney Javier's authority to represent him
was terminated or expired upon his demise, hence,
the notice of appeal filed by said counsel was invalid,
a worthless piece of paper.
The Court of Appeals issued a resolution on October
6, 1989, dismissing the appeal. It held:
It is a well-established rule that a
lawyer-client relationship is
terminated upon the death of the
client. The lawyer's authority to
appear for his client automatically
ceases (5 Am. Jur. 282). The only
exceptions are when there is a
contract for the lawyer's services up
to judgment, or when his fees are
on a contingent basis, and also
when his appearance is coupled
with an interest (7 CJS 945, 946).
Since not one of the above
exceptions obtains in this case, it is
obvious that when Attorney Javier
filed the notice of appeal after his
client's death, he no longer had any
authority to appear for him. Hence,
the notice of appeal filed by him
was a mere scrap of paper and
without any legal effect.
WHEREFORE, the instant appeal
is hereby DISMISSED. (pp.
27-28, Rollo.)
The Motion for reconsideration filed by the heirs'
new counsel was likewise denied by the Court of
Appeals.
Hence, the present petition in which the petitioners,
as heirs of the late Maximo Regoso, allege that the
Appellate Court erred in dismissing their appeal and
in not declaring that the judgment which the trial
court rendered after the death of said defendant, was
null and void.
The petition has no merit.
Under the rules, it is the duty of the attorney for the
deceased defendant to inform the court of his client's
death and to furnish the court with the names and
residences of the executor, administrator, or legal
representative of the deceased. Sections 16 and 17,
Rule 3 of the Rules of Court provide:
Sec. 16. Duty of attorney upon
death, incapacity, or incompetency
of party.— Whenever a party to a
pending case dies, becomes
incapacitated or incompetent, it
shall be the duty of his attorney to
inform the court promptly of such
death, incapacity or incompetency,
and to give the name and residence
of his executor, administrator,
guardian or other legal
representative.
Sec. 17. Death of party.— After a
party dies and the claim is not
thereby extinguished, the court
shall order, upon proper notice, the
legal representative of the deceased
to appear and to be substituted for
the deceased, within a period of
thirty (30) days, or within such
time as may be granted. If the legal
representative fails to appear within
said time, the court may order the
opposing party to procure the
appointment of a legal
representative of the deceased
within a time to be specified by the
court, and the representative shall
immediately appear for and on
behalf of the interest of the
 deceased. The court charges
involved in procuring such
appointment, if defrayed by the
opposing party, may be recovered
as costs. The heirs of the deceased
may be allowed to be substituted
for the deceased, without requiring
the appointment of an executor or
administrator and the court may
appoint guardian ad litemfor the
minor heirs.
The rules operate on the presumption that the
attorney for the deceased party is in a better position
than the attorney for the adverse party to know about
the death of his client and to inform the court of the
names and addresses of his legal representative or
representatives.
In the case at bar, no such notice of death, nor a
motion for substitution of the deceased defendant,
was ever made. Hence, the trial court could not be
expected to know or take judicial notice of the death
of defendant, Maximo Regoso, without the proper
manifestation from his counsel. It must be
remembered that the fault or negligence was Attorney
Javier's alone (Llantero vs. Court of Appeals, 105
SCRA 609; Chittick vs. Court of Appeals, 166 SCRA
219; Pulido vs. CA, 122 SCRA 63).
The supervening death of the defendant, Maximo
Regoso, did not extinguish his wife's action for
partition of their conjugal assets, for it is an action
that survives. The trial of the case on the merits was
already finished before the defendant died. Since it
was not informed about that event, the trial court may
not be faulted for proceeding to render judgment
without ordering the substitution of the deceased
defendant. Its judgment is valid and binding upon the
defendant's legal representatives or successors-in-
interest, insofar as his interest in the property subject
of the action is concerned (Florendo, et al. vs.
Coloma, et al., 129 SCRA 304).
Attorney Javier's appeal from the decision of the trial
court was correctly dismissed by the appellate court
for upon the death of Maximo Regoso, Attorney
Javier's authority to represent him also expired. Then
notice of appeal, which Attorney Javier filed on
behalf of the decedent was an unauthorized pleading,
hence, invalid (Barrameda, et al. vs. Barbara, et al.,
90 Phil. 718; Caseñas vs. Rosales, 19 SCRA 462).
However, the validity of the judgment of the trial
court was not affected by the defendant's demise for
the action survived. The decision is binding and
enforceable against the successors-in-interest of the
deceased litigant by title subsequent to the
commencement of the action [Section 49(b) Rule 39,
Rules of Court; Florendo, et al. vs. Coloma, et al.,
129 SCRA 304].
This is in line with the following provisions of the
Rules of Court:
Sec. 49. EFFECT OF
JUDGMENTS.—The effect of a
judgment or final order rendered by
a court or judge of the Philippines,
having jurisdiction to pronounce
the judgment or order, maybe as
follows:
xxx xxx xxx
(b) In other cases the judgment or
order is, with respect to the matter
directly adjudged or as to any other
matter that could have been raised
in relation thereto, conclusive
between the parties and their
successors-in-interest by title
subsequent to the commencement
of the action or special proceeding,
litigating for the same thing and
under the same title and in the same
capacity. (Section 49(b), Rule 39,
New Rules of Court.)
Thus, a judgment in an ejectment case may be
enforced not only against defendants therein but also
against the members of their family, their relatives, or
privies who derived their right of possession from the
defendants (Ariem vs. De los Angeles, 49 SCRA
343). The same rule applies to the successors-in-
interest of a deceased party in an action that survives,
if the decision should go against the latter (Florendo,
Jr. vs. Coloma, 129 SCRA 304, 305.)
WHEREFORE, the petition for review is hereby
DENIED.
SO ORDERED.
G.R. No. 96296 June 18, 1992
RAFAEL S. DIZON, in his capacity as
Administrator of the Estate of the Deceased JOSE
P. FERNANDEZ, REDENTOR MELO,
ELIODORO C. CRUZ, PIER 8 ARRASTRE &
STEVEDORING SERVICES, INC., COMPAÑIA
MARITIMA, PASIG STEVEDORING
COMPANY, INC., and WESTERN PACIFIC
CORPORATION, petitioners,
vs.
HON. COURT OF APPEALS, HON. PROTACIO
C. STO. TOMAS, Judge, RTC, Branch 14, Ligao,
Albay, and JOSE BALDE, respondents.
NARVASA, C.J.:
In the original action has given rise to the
proceedings at bar 1 — instituted in 1975 by the
plaintiff Jose Balde (private respondent herein)
principally for the recovery of damages resulting
from the allegedly illegal termination of his
employment from the so-called "Fernandez
Companies" 2 effected by herein petitioners — one of
the defendants, Jose P. Fernandez, denominated the
"principal" one, died before final judgment of the
Trial Court. The legal consequences of that party's
death are what are now chiefly in issue.
The complaint filed in the Court a quo 3 named as
defendants the six (6) petitioner corporations herein,
as well as (1) Jose P. Fernandez "in his own personal
capacity and/or as Chairman of the Board, President,
or Director" of said firms; (2) Redentor R. Melo, "in
his own personal capacity and/or as Chief Legal
Counsel of Pier 8 Arrastre & Stevedoring Services,
Inc.;" and (3) Eliodoro C. Cruz, "in his own personal
capacity and/or as a legal assistant" in the same
company. It alleged that Balde was "summarily
ousted and dismissed" from his job as "Chief
Accountant and Credit & Collection Manager of Pier
8 Arrastre and Stevedoring Services . . . (since) 1973
and Chief Accountant of Western Pacific Corporation
. . . (since) 1974."
The defendants filed a motion to dismiss on the
ground that the Court had no jurisdiction over the
nature of the action, which was essentially a "money
claim" arising from an employer-employee
relationship exclusively cognizable by the National
Labor Relations Commission, and that no official
decision had yet been reached regarding termination
of Balde's employment. 4 The defendants also filed a
supplemental motion urging dismissal of the action
because venue had been improperly laid. 5 After
oppositions were filed to both motions, the Court
issued an Order holding "in abeyance the resolution .
. . (thereof) until pre-trial is conducted and evidence
is presented . . . without prejudice to dismissing the
case when the ground for dismissal becomes
apparent." 6
The defendants thereafter presented their "Answer
with Compulsory Counterclaim," which contained
specific denials and qualified admissions of the
averments of the complaint; alleged as affirmative
defenses the same grounds alleged in their motions to
dismiss, and the fact that they had acted entirely in
accordance with law and in all good faith in
discharging Balde from employment, he having
"done acts prejudicial and inimical to their interest
and (which) have caused damage;" and seeking
recovery of moral, actual and exemplary damages
resulting from Balde's "completely unfounded and
baseless action." 7 Pre-trial and trial ensued after
Balde filed his answer to the counterclaim and a reply
to the answer.
Balde's presentation of his evidence-in-chief was
concluded upon the admission by the Court of his
exhibits over the defendants' objections, by Order
dated October 21, 1987.
Some two weeks afterwards, or more precisely on
November 7, 1987, defendant Jose P. Fernandez died.
Notice thereof was given to the Court by his counsel,
through a manifestation dated November 16, 1987.
As intimated in the opening paragraph of this
Decision, the death of Fernandez brought up the
question of the legal consequences of that demise,
and the action that Trial Court should properly take in
view thereof. For the sake of clarify, and the better to
gauge the propriety of the action actually taken by
Trial Court, the narration of the material facts is
interrupted at this point, so that a brief exposition of
the applicable law may be made.
The effects of the death of a defendant in a civil suit
are dependant upon of the nature action: whether (a)
the action is a personal one for "recovery of money,
debt or interest thereon," 8 or (b) is not for said
purpose, 9 i.e., it is a real action, 10or one for recovery
of personal property "or to enforce a lien thereon, and
actions to recover damages for an injury to person or
property, real or personal." 11 The effects of the
defendant's death are dependent, as well, on the time
of his demise.
The law says that "(w)hen the action is for recovery
of money, debt or interest thereon, and the
defendant dies before final judgment in the Court of
First Instance (now Regional Trial Court), it shall be
dismissed to be prosecuted in the manner especially
provided in these rule." 12
The "especial" manner of the prosecution of said
money claims against the decedent is set forth in Rule
86 of the Rules of Court, 13 in connection with the
judicial proceedings for the settlement of the estate of
a deceased person. "The reason for the dismissal of
the ordinary action," as a noted commentator stresses,
"is that upon the death of the defendant a testate or
intestate proceeding shall be instituted in the proper
court wherein all his creditors must appear and file
their claims which shall be paid proportionately out
of the property left by the deceased. It is, therefore, to
avoid useless duplicity of procedure that the ordinary
action must be wiped out from the ordinary
courts." 14
If the defendant dies after final judgment of the
Regional Trial Court, the action (for money, debt or
interest thereon) is not dismissed, and an appeal may
be taken by or against the administrator; 15 but if that
judgment against the deceased becomes final and
executory, it shall be enforced, not by execution
under Rule 39, but in accordance with Section 5 of
Rule 86, 16 i.e., by presenting the same as a claim
against the estate.
If, on the other hand, the claim against the defendant
is other than for "money, debt or interest thereon" —
i.e., it is a real action, 17 or one for recovery of
personal property "or to enforce a lien thereon, and
actions to recover damages for an injury to person or
property, real or personal," supra 18 — and the
defendant dies, the claim against him is not thereby
extinguished, and the action will not be dismissed but
continue against the decedent's legal representative.
Section 17, Rule 3 specifies the procedure to be
followed, viz.
. . . After a party dies and the claim
is not thereby extinguished, the
court shall order, upon proper
notice, the legal representative of
the deceased to appear and to be
substituted for the deceased, within
a period of thirty (30) days, or
within such time as may be
granted. If the legal representative
fails to appear within said time, the
court may order the opposing party
to procure the appointment of a
legal representative of the deceased
within a time to be specified by the
court, and the representative shall
immediately appear for and on
behalf of the interest of the
deceased. The court charges
involved in procuring such
appointment, if defrayed by the
opposing party, may be recovered
as costs. The heirs of the deceased
may be allowed to be substituted
for the deceased, without requiring
the appointment of an executor or
administrator and the court may
appoint guardian ad litem for the
minor heirs.
The record discloses that the Court did not dismiss
the action as against the deceased defendant,
Fernandez, conformably with Section 21, Rule 3.
What it did was: (a) to require the defendants' new
counsel, former Supreme Court Justice Arsenio P.
Dizon, by Order dated November 21, 1987, "to effect
the substitution of said deceased defendant within
thirty (30) days . . .," 19 (a requirement it reiterated in
another Order dated October 4, 1988); and (b) on
later learning that said Justice Dizon was the
Administrator of the Fernandez Estate, to require the
latter, by Order dated January 2, 1989, to appear
before it on February 4, 1989 (later reset to March 6,
1989) "to be substituted as party defendant for and in
behalf of the deceased Jose P. Fernandez" The Trial
Judge was obviously proceeding in accordance with
Section 17, Rule 3; and it was doing so quite
erroneously, since the action against the deceased and
his co-defendants was clearly one for the "recovery of
money, debt or interest thereon" which, by direction
of Section 21 of the same Rule, should
"be dismissed to be prosecuted in the manner
especially provided in these rules," at least in so far
as concerned the deceased defendant.
Justice Dizon was unable to appear at the hearing of
March 6, 1989, on account of the poor state of his
health at the time. This he alleged in a telegram to the
Court, and in a subsequent formal motion, seeking on
that account a resetting of the hearing to "either April
17, 18 and 28/89 or May 1, 2 and
3/89." 20 Unfortunately, neither the telegram nor the
motion was received by the Trial Court in time.
Hence, by Order dated March 6, 1989, the Court
directed plaintiff Jose Balde to formally move in
writing to have the case submitted for decision by
reason of the defendant's failure to appear despite
notice.
When the defendants received notice of the Order of
March 6, 1989, they promptly moved for
reconsideration through Atty. Rafael Dizon, under
date of March 18, 1989. 21 By order dated March 31,
1989, the Trial Court, without referring to its earlier
Order of March 6, 1989, re-schedule the hearing on
April 24 1989, but required that "if and when Atty.
Arsenio Dizon shall still be indisposed during the
next hearing, one of the associates of the law firm
shall appear for the defendants in order to avoid
further delay in the disposition of this case . . .
(considering that) this case was fled since 1975 and
this case could not be disposed of because of
continuous postponement by the parties." 22
However, notice of the Order of March 31, 1989 —
resetting the hearing on April 24, 1989 — sent from
Ligao, Albay, was not received by the defendants in
Metro Manila until the very day of the hearing, April
24, 1989. Atty. Rafael Dizon immediately dispatched
a telegram to the Court that same day, reading as
follows: "RECEIVED COPY MARCH 31, 1989
ORDER SETTING HEARING OF CIVIL CASE,
528 APRIL 24 ONLY TODAY APRIL 24, 1989,
REQUEST RESET TO MAY 2, 14, 25, 31, JUNE 1,
2, 1989. FORMAL MOTION TO FOLLOW." The
telegram evidently came too late. What the Court had
before it when the case was called at the appointed
hour on April 24, 1989 was Atty. Dizon's motion
dated March 18, 1989 for reconsideration of the
Order of March 6, 1989, which had already been
granted (the Court having on March 31, 1989, reset
the hearing on April 24, 1989). The Court then
proceeded to declare said motion of April 18, 1989
"moot and academic" and, in view of the defendants'
absence at the hearing of April 24, 1989, to consider
the case submitted for decision. These disposition it
made in the following Order, to wit:
When this case was called for
hearing this morning, the court
received the Motion seeking for
reconsideration of the order dated
March 6, 1989 considering this
case submitted for decision, for
failure of counsel for the
defendants to appear on the said
setting. The record shows that the
order sought to be reconsidered by
defendants has already been
reconsidered by this court, when
the court ordered on March 31,
1989 to set this case for today.
The Motion for Reconsideration
filed by Atty. Rafael S. Dizon, now
appearing as counsel for the
defendants, is hereby considered
moot and academic.
In view, however, of the fact that
the defendants and counsel failed to
appear today without justifiable
cause, on motion of plaintiff, this
case is hereby ordered submitted
for decision based on the evidence
so far presented.
According to the petitioners, notices of the Orders of
April 24, 1989 and March 31, 1989 were never
served on them or their counsel. 23 This is why, under
date of October 19, 1989, they filed a "Motion to
Resolve Motion for Reconsideration dated March 18,
1989 and to Set Case for Hearing." 24 This last
motion was resolved by the Trial Court — now
presided over by Hon. Protacio C. Sto. Tomas — in
an Order dated October 17, 1989. In said Order the
Court quoted verbatim the Order of April 24, 1989 of
"Hon. Salvador D. Silerio, then Presiding Judge of
this Court;" pointed out that said order of April 24,
1989 "has not been reconsidered and set aside;" and
directed the immediate transmittal, "pursuant to an
existing Administrative Order issued by the Supreme
Court, . . . (of) the records . . . to Judge Salvador D.
Selerio, Presiding Judge of RTC, Branch 8, Legazpi
City for him to render the corresponding decision." 25
The petitioners received copy of the Order of October
17, 1989 on November 7, 1989. On the same day,
they also received a copy of another Order of the
same Court dated October 25, 1989, 26 dealing with
their motion of October 19, 1989 and reading as
follows:
The records disclosed that the
Motion to Resolve Motion for
Reconsideration dated March 18,
1989 and to Set Case for Hearing
filed by Atty. Rafael S. Dizon dated
October 19, 1989 has already been
resolved and acted upon, in the
sense, that this case was already
submitted for decision as of April
24, 1989 signed by Hon. Salvador
D. Silerio, presiding Judge, copy of
which was furnished Atty. Rafael
Dizon. Atty. Dizon appears not to
have a fixed address as the order of
the court sent to him addressed at
5th Floor, Strata Building, Emerald
Avenue, Ortigas Commercial
Complex, Pasig, Metro Manila has
not been claimed by said counsel.
Examining the instant motion, we
find that it does not conform with
the mandatory of Sections 4, 5 and
6 of Rule 15 of the Rules of Court.
Wherefore, the motion is denied.
On November 21, 1989, the petitioners once again
filed a motion for reconsideration, this time directed
against the Orders of April 24, October 17, and
October 25, 1989. In that motion, denominated
"Motion for Reconsideration with Motion to
Dismiss," 27 the petitioners —
1) averred that they had failed to appear at the
hearing on April 24, 1989 at 8:30 a.m., as directed in
the Order of March 31, 1989, because they received
notice thereof "ONLY ON THE VERY SAME DAY
AND PAST THE TIME OF THE SCHEDULED
HEARING," as stated in their telegram of April 24,
1989; and
2) argued that, "due to defendant Jose P. Fernandez
death on November 7, 1987" and in light of "Rule 3,
Sec. 21," the case "must necessarily be dismissed and
prosecuted pursuant to Sec. 1, Rule 87 of the Rules of
Court."
The petitioners set the motion for hearing on
December 6, 1989 at 8:30 A.M., furnishing copy
thereof on advance counsel by registered mail. In
anticipation of his attendance at the hearing of his
motion, Atty. Rafael Dizon booked passage on the
PAL flight from Manila to Legazpi City on
December 5, 1989 and from Legazpi to Manila on
December 6, 1989. 28
Events however made it impossible for Atty. Dizon
to appear at the sala of Judge Sto. Tomas, on
December 6, 1989. These events, specified by Dizon,
were those resulting from the aborted coup d'etat on
December 1, 1989,i.e., "the closure of the Manila
Domestic Airport, the indefinite cancellation of all
domestic airline flights and the unavailability of
Public transportation going out of Metro Manila."
Alleging these as basis, Atty. Dizon sought a
resetting of the hearing on his motion to December
20, 1989, through a telegram, 29 and an "Urgent
Motion to Reset" dated December 4, 1989. 30
The Court denied the telegraphic request for
postponement, in an Order dated December 6,
1989, viz.:
When the Motion for
Reconsideration with Motion to
Dismiss dated November 21, 1989
was called for hearing, the movant
Rafael S. Dizon failed to appear
notwithstanding that this is the date
set forth by him. However, a
telegram has been received wherein
said movant prays for a
postponement of the hearing of said
motion alleging that a formal
motion will follow.
Examining the records, we find that
the first motion for reconsideration
dated March 18, 1989 was already
resolved and denied by this Court
in its order of October 25, 1989.
This being the case, and
considering that the rules does not
allow a second motion for
reconsideration without first
securing leave of court, the instant
motion for reconsideration dated
November 21, 1989 is DENIED.
In view of the foregoing development, the petitioners
felt constrained to institute, as they did institute in the
Court of Appeals a special civil action of certiorari to
annul and set aside the Trial Court's five (5) Orders
just mentioned, of April 24, May 29, October 17,
October 25, and December 6, 1989. 31 Their action
failed. The Appellate Tribunal declared that upon the
facts, it was "not prepared to rule that respondent
Court's issuance of the assailed orders is tainted with
grave abuse of discretion calling for the application
of the extra-ordinary writ of certiorari," and
accordingly dismissed their petition. More
particularly, it ruled that —
1) "the alleged error committed by respondent Court
in not dismissing the complaint against the deceased
defendant Jose Fernandez, if at all, is merely an error
of judgment and not of jurisdiction," and hence, not
correctible by the special civil action
of certiorari under Rule 65;
2) "even if the claim against the deceased . . .
Fernandez may de dismissed, it does not necessarily
follow that the complaint in Civil Case No. 528-LV
should be dismissed in toto, considering that there are
other defendants in the case, and considering further
that some of the defendants in the case, and
considering further that some of the defendants, the
principals at that, are corporate entities with separate
juridical personalities;" and
3) "if petitioners did not receive copies of the orders
issued by respondent Court, it was for the reason that
they have been continuously changing their address."
Their motion for reconsideration having been denied,
by Resolution of the Court of Appeals dated
November 21, 1990, the petitioners have appealed to
this Court. Here they contend that:
1) "The Rules of Court mandate the dismissal of the
case and not substitution of the deceased defendant;"
and
2) They "had a valid/justifiable cause for failing to
appear in the scheduled hearing."
The private respondent's two-page comment dated
February 16, 1991 submitted in response to the
Court's requirement therefor, does nothing except to
assert, basically, that "there is no showing at all that
the Hon. Court of Appeals acted with grave abuse of
discretion," contrary to the petitioners' claim of
"patent excess of jurisdiction and/or grave abuse of
discretion" on the part of the Appellate Court." 32
By this Court's Resolution of April 15, 1991, the
petition was given due course and memoranda
required of the parties, which have since been
submitted. 33
The first point raised by petitioners is well taken. As
already stated, 34 the law is quite explicit and leaves
the Trial Court with no choice: "When the action is
for recovery of money, debt or interest thereon, and
the defendant dies before final judgment in the Court
of First Instance (now Regional Trial Court), it shall
be dismissed to be prosecuted in the manner
especially provided in these rules." 35 It was therefore
error for the Trial Court to decline to dismiss the suit
as against the deceased Fernandez and to insists on
continuing with the action as to Fernandez by
ordering his substitution by his administrator. 36
It was error, too, for the Trial Court to deny Atty.
Dizon's motion dated November 21, 1989 for
reconsideration of the Orders of April 24, October
17, and October 25, 1989, on the ground that it was
in effect a second motion for reconsideration "the
rules does (sic) not allow a second motion for
reconsideration without first securing leave of court .
. ." There is no such rule as regards interlocutory
orders like those sought to be reconsidered. The Trial
Judge might possibly have had in mind Section 4,
Rule 37, of the Rules of Court, governing a "second
motion for new trial, based on a ground not existing
nor available when the first motion was made," but
the section clearly applies only to final judgments,
not to interlocutory orders. The Trial Judge might
have had in mind Section 1, Rule 52 pertinently
providing that "(n)o more than one motion for re-
hearing or reconsideration shall be filed without
express leave of court," but again, it is clear that the
proviso applies only to final judgments of the Court
of Appeals, not to interlocutory orders or resolutions.
The Trial Judge might have had in view Section 11 of
Batas Pambansa Bilang 129 (Judiciary
Reorganization Act of 1980) which inter alia decrees
that "no second motion for reconsideration shall be
entertained," or paragraph 4 of the Interim or
Transitional Rules relative to the implementation of
said B.P. Blg. 129, promulgated by this Court,
declaring that "(n)o party shall be allowed a second
motion for reconsideration of a final order or
judgment;" but again these provisions obviously have
reference not to interlocutory orders but to final
judgments or orders. A second motion attacking an
interlocutory order might possibly be denied on the
ground that it is a "rehash" or mere reiteration of
grounds and arguments already passed upon and
resolved by the Court; it cannot be rejected on the
ground that a second motion for reconsideration of an
interlocutory order is forbidden by law.
The question that now arises is whether these errors
amount to grave abuse of discretion on the part of the
Trial Judge. The first does. In adamantly refusing to
dismiss the action against the deceased Fernandez so
that the claim against him might be filed in the
special proceedings for the settlement of his estate, it
is clear that His Honor was refusing to apply an
explicit mandate of the Rules of Court although well
aware of it, and of the fact that no reason existed in
the record for excepting the case at bar from the
operation of the rule. Such a refusal, in other words,
may not be deemed to constitute "merely an error of
judgment and not of jurisdiction," as the Court of
Appeals characterizes it, but as an outright defiance
of the plain provisions of the Rules of Court which
had been insistently brought to his attention; an act
therefore, executed without any jurisdiction in law,
whimsically, capriciously, and oppressively; an act,
in short, done with grave abuse of discretion. 37
What has just been stated makes inconsequential the
failure of Atty. Dizon to appear before the Court on
December 6, 1989, the date set by him for the hearing
of his motion for reconsideration of November 21,
1989 — in which he asked that said hearing be reset
because fortuitous events precluded his appearance,
and reiterated the prayer that the action be dismissed
as against defendant Fernandez because of the latter's
demise. For even assuming that Atty. Dizon's failure
to receive notices of, and consequent omission to
appear at, the hearings of February 4, 1989, March 6,
1989 and April 24, 1989 were inexcusable, because
the failure to receive said notices was due to his
"continuously changing his address," as the Court of
Appeals points out, that circumstance did not make
unmeritorious the motion for dismissal of the suit as
against deceased Fernandez. It must be mentioned,
however, in fairness to Atty. Dizon, that he had as a
matter of fact made preparation for presenting
himself before the Trial Court at the hearing of
December 6, 1989, booking passage on Philippine
Airlines on December 5, 1989, and that the closure of
airports and cancellation of domestic flights on
account of the aborted coup d'etat of December 1,
1989 — of which the Court takes judicial notice —
had indeed made impossible his intended appearance
before the Trial Court on the appointed day,
December 6, 1989.
Not to be overlooked in this case is the nature of the
complaint instituted by Jose Balde in the Trial
Court, 38 which upon sufficient reflection is disclosed
as pertaining to the exclusive jurisdiction of the
Labor Arbiters of the Department of Labor and
Employment and not the regular courts of justice.
That complaint alleged that Balde was "summarily
ousted and dismissed" from his job as "Chief
Accountant and Credit & Collection Manager of Pier
8 Arrastre and Stevedoring Services . . . (a job he had
held since) 1973 and Chief Accountant of Western
Pacific Corporation . . . (held since) 1974. " It averred
that despite his having worked efficiently and caused
an increase in the profitability of the companies, and
allegedly on evidence known by defendant Cruz to be
sham — that he (Balde) was implicated in some
anomaly in the procurement of supplies and spare
parts — said defendant Cruz unceremoniously
relieved him of his duties and sealed and searched his
personal belongings; that on his (Balde's) insistence,
an investigation was eventually conducted by
defendant Melo, the Chief Legal Counsel, ostensibly
to ascertain the truth but which was actually nothing
but an "inquisition" characterized by "malice, bias,
prejudice and partiality, " at which he was not
accorded full opportunity to defend himself; and that
Fernandez, the highest corporate official in the
corporations, turned a deaf ear to Balde's pleas for a
"speedy and impartial investigation." Upon these
factual assertions, the complaint prayed for the
payment by the defendants to Balde of actual, moral,
and exemplary damages in the aggregate amount of
P1,100,000.00, attorney's fees in the sum of
P100,000.00, and "such other reliefs equitable in the
premises." It did not include reinstatement as a
specific relief.
The complaint, in other words, set forth claims for
money arising from employer-employee relations.
Now, at the time that the complaint was filed, in
1975, exclusive jurisdiction over such "money claims
arising form employer-employee relations" 39 as well
" all other cases or matters arising from employer-
employee relations," 40 was vested by the law in the
Labor Arbiters of the National Labor Relations
Commission. 41 That jurisdiction remained
substantially unaffected by subsequent amendments
of the Labor Code up to 1989, 42 when Republic Act
No. 6715 became effective, except that for a time,
about three (3) years, Labor Arbiters were divested of
competence to "entertain claims for moral or other
forms of damages." 43
Under Republic Act No. 6715, 44 embodying the
latest amendments to the Labor Code of the
Philippines, the following cases inter alia fall within
the "original and exclusive jurisdiction" of Labor
Arbiters, to wit:
xxx xxx xxx
(2) Termination disputes;
(3) If accompanied with a claim for
reinstatement, those cases that
workers may file involving wages,
rates of pay, hours of work and
other terms and conditions of
employment;
(4) Claims for actual, moral, WHEREFORE, the Decision of the Court of Appeals
exemplary and other forms of promulgated on July 20, 1990 and its Resolution
damages arising from employer- dated November 21, 1990, in CA-G.R. SP No.
employee relations; 19602, as well as the Orders of the Regional Trial
xxx xxx xxx Court (Branch 14) at Ligao, Albay in Civil Case No.
(6) Except claims for employees 528-LV dated May 9, 1989, October 17, 1989,
compensation, social security, October 25, 1989 and December 6, 1989 are
medicare and maternity benefits, all REVERSED and SET ASIDE, and said Civil Case
other claims arising from No. 528-LV is ORDERED DISMISSED for lack of
employer-employee relations, jurisdiction of the subject matter and, as regards the
including those persons in domestic deceased Jose P. Fernandez, on the additional ground
or household services, involving an set forth in Section 17, Rule 3 of the Rules of Court,
amount not exceeding five without pronouncement as to costs.
thousand pesos (P5,000.00) SO ORDERED.
whether or not accompanied with a
claim for reinstatement.
The claims in question do not involve "wages, rates
of pay hours of work and other terms and conditions
of employment." They do constitute, however, a
"termination dispute," and are actually "claims for
actual, moral, exemplary and other forms of damages
arising from employer-employee relations,"
unaccompanied by a prayer for reinstatement. As
such they are, as the law clearly says, within the
"original and exclusive jurisdiction" of Labor
Arbiters. In other words, whether under the law at
present in force, or that at the time of the filing of the
complaint, Jose Balde's cause falls within the
exclusive original jurisdiction of the Labor Arbiters
and not of the Regional Trial Court (formerly, Court
of First Instance).
To be sure, this jurisdictional defect in the
proceedings has not been explicity put at issue in the
appeal at bar, although references appear in the
pleadings to the various motions filed by Fernandez
and his co-defendants with the Regional Trial Court
to dismiss the action for want of jurisdiction over the
nature of the suit instituted by Jose Balde. This
omission is of no moment. Excepted from the general
rule that in appellate proceedings in the Court of
Appeals or this Court, " no error . . . will be
considered unless stated in the assignment of errors
and properly argued in the brief" (or otherwise raised
as an issue), are (1) errors which "affect the
jurisdiction over the subject matter," (2) "plain
errors," and (3) "clerical errors". 45
G.R. No. L-40336 October 24, 1975
LAMBERTO V. TORRIJOS, petitioner,
vs.
THE HONORABLE COURT OF
APPEALS, respondent.
Alexander H. Brillantes and Romulo R. Candoy for
petitioner.
Office of the Solicitor General Estelito P. Mendoza,
Assistant Solicitor General Santiago M. Kapunan
and Solicitor Simfronio I. Ancheta for respondent.
MAKASIAR, J.:
Petitioner seeks the reversal of the order of the
respondent Court of Appeals dated February 20,
1975.
The undisputed facts are as follows:
Wakat Diamnuan and his wife were the registered
owners of one-fourth share of a parcel of land
containing an area of 39.9643 hectares situated in
Sitio Cacuban, Barrio Gumatdang, Pitogon, Benguet,
covered by OCT No. O-36, issued in their names and
in the names of Kangi Erangyas, and the heirs of
Komising Tagle, who owned the remaining portions.
On May 11, 1968, Wakat Diamnuan and his wife
sold their one-fourth share in favor of petitioner
Torrijos for P7,493.00. the deed of sale, however,
was refused registration because Torrijos, who
produced OCT No. O-36, did not have the copies
thereof held by the other co-owners, Kangi Erangyas
and heirs of Komising Tagle.
In 1969, the entire property, together with the share
of Wakat Diamnuan and his wife, was sold to Victor
de Guia for P189,379.50. Hence, Torrijos prosecuted
Wakat Diamnuan for estafa before the Baguio Court
of First Instance, docketed as Criminal Case No. 70
entitled "People of the Philippines versus Wakat
Diamnuan."
After trial, the trial Judge convicted the accused in a
decision dated January 17, 1973 sentencing him to an
imprisonment of 3 months of arresto mayor, to pay a
fine of P7,493.00 with subsidiary imprisonment, to
indemnify petitioner Lamberto Torrijos in the sum of
P7,493.00 and to pay the costs. The trial Judge added
as the second paragraph of the dispositive portion of
the decision that "Whatever damages may have been
suffered by Torrijos before the Deed of Sale in favor
of Victor de Guia was made by the accused and his
co-owners may be the subject of some other action,
perhaps civil, but not in this case."
Upon motion for reconsideration filed by
complainant Torrijos, in an order dated March 5,
1973, the trial court modified its decision by
increasing the indemnity in favor of Torrijos from
P7,493.00 to P25,000.00 and the fine from P7,493.00
to P25,000.00..
On March 7, 1973, the accused filed a motion for the
reconsideration of the order of March 5, 1973, which
was denied by the court a quo in an order dated April
11, 1973. Thereafter, the accused appealed to the
Court of Appeals.
On August 5, 1973, the accused died, for which
reason his counsel moved to dismiss the appeal under
paragraph 1 of Article 89 of the Revised Penal Code,
which provides that the death of a convict
extinguishes, not only the personal penalties, but also
the "pecuniary penalties" as long as the death occurs
before final judgment.
Complainant Torrijos opposed the said motion to
dismiss appeal on the ground that the term "pecuniary
penalty" should not include civil liability in favor of
the offended party, which was decreed by the trial
court in this case, as the civil action therefor was not
reserved, much less filed separately from the criminal
action.
The respondent Court of Appeals sustained the
motion, which is shared by the Solicitor General, and
forth with issued the challenged order dated February
20, 1975 dismissing the appeal.
Hence, this petition.
It should be stressed that the extinction of civil
liability follows the extinction of the criminal liability
under Article 89, only when the civil liability arises
from the criminal act as its only basis. Stated
differently, where the civil liability does not exist
independently of the criminal responsibility, the
extinction of the latter by death, ipso
factoextinguishes the former, provided, of course,
that death supervenes before final judgment. The said
principle does not apply in instant case wherein the
civil liability springs neither solely nor originally
from the crime itself but from a civil contract of
purchase and sale. The estafa or swindle existed only
after the subsequent sale by the accused of the same
interest in favor of Victor de Guia. There was no
crime of estafa until the accused re-sold the same
property to another individual about 5 years after the
first sale to Torrijos. If the accused did not comply
with the sale he executed in favor of Torrijos in 1964,
after his receipt of the purchase price from Torrijos,
but before the second sale to Victor de Guia in 1969,
there is no question that the accused would be merely
civilly liable either through an action by Torrijos for
specific performance with damages or for rescission
of contract also with damages. If rescission were
pursued by the first vendee, the vendor would be
liable to refund the purchase price as well as be
responsible in damages. Consequently, in the case at
bar, the civil liability of the accused survives his
death; because death is not a valid cause for the
extinguishment of civil obligations.
Thus, WE held that, despite the acquittal based on
death for the crime of homicide or physical injuries
or damage to property through reckless imprudence,
notwithstanding the absence of any reservation to file
a civil action, such acquittal does not preclude the
offended party from pursuing a civil action for
damages based on tort or culpa aquiliana. And the
civil action based on tort or contract need not be
reserved (Tan vs Standard Vacuum Oil Co., et. al., 91
Phil. 972; Dionisio, et al. vs. Alvendia, et. al., 102
Phil. 443, 445-447; Chan vs. Yatco, L-11162, April
30,1958; Capuno vs. Pepsi Cola, 13 SCRA 658).
Then again, Articles 19, 20 and 21 of the New Civil
Code on human relations establish the civil liability
of the accused in this particular case independently of
his criminal liability, despite his death before final
conviction.
Article 19 directs that "every person must, in the
exercise of his right and the performance of his
duties, act with justice, give anymore his due, and
observe honesty and good faith." The accused in the
case at bar, by executing a second sale of the property
which he already sold to the offended party, certainly
did not observe honesty nor good faith, much less act
with justice to the complaining witness.
Article 20 provides that "every person who, contrary
to law, willfully or negligently causes damage to
another, shall indemnify the latter for the same."
Certainly in deliberately selling again the same civil. From a judgment convicting civil liability of
property to another person after he had sold the same the accused, two appeal may, the accused
to the offended party, the accused willfully or accordingly, be taken. The accused (section 107,
intentionally inflicted damage on the offended party, may seek a review of said General Orders
to whom indemnification therefor shall be made by judgment, as regards both actions. No. 58),
him. Similarly, the complainant may necessarily
Article 21 states that "any person who willfully appeal, with respect only to the implies that such
causes loss or injury to another in a manner that is civil action, either because the right is protected
contrary to morals, good customs or public policy, lower court has refused or failed to in the same
shall compensate the latter for the damage." It is award damages, or because the manner as the
patent that the act of the accused in the case at bar in award made is unsatisfactory to right of the
alienating the same property which he already sold to him. The right of either to appeal or accused to his
the complainant, has violated all the rules of morality not to appeal, in the event of defense. If the
and good customs. Hence, he should be answerable conviction of the accused, is not accused has the
to the offended party for the injury thus caused to dependent upon the other. The right within
him. Even if the moral wrong or injury does not complainant may not, by fifteen days to
constitute a violation of the statute, his civil liability expressing his conformity to the appeal from the
under this article subsists (Velayo vs. Shell Co., 100 award of damages, prevent the judgment of
Phil. 186). In the instant case, the wrong committed accused from appealing, either conviction, the
by the accused is a breach of statutory as well as from said award or, from the offended party
moral law, for there was deceit perpetrated on both judgment of conviction. Neither should have the
the first and second vendees. may the accused, by acquiescing right within the
Consequently, while the death of the accused here thereto, prevent the complainant same period to
inextinguished his criminal liability including fine, from appealing therefrom, insofar appeal before so
his civil liability based on the laws of human as the civil liability is concerned. much of the
relations aforecited, remains. Upon the other hand, an appeal by judgment as is
Moreover, in "People of the Philippine, plaintiff and the complainant, with respect to the prejudicial to
appellee. Nicolas Manuel, aggrieved or offended aforementioned civil liability, him, and his
party-appellant, vs. Celestino Coloma, defendant and would not impose upon the accused appeal should not
appellee, "WE ruled that a criminal case may be the legal obligation to appeal. He be made
reopened in order that the offended party can prove may choose not to appeal from the dependent on that
damages, although the decision therein convicting the judgment of conviction, and, of the accused. If
accused had already become final and made no award hence,the same may become final upon appeal by
of the damages upon the ground that the information and executory, and may be fully the accused the
failed to allege any damages suffered; or the executed, without prejudice to the court altogether
aggrieved party may appeal from an unsatisfactory aforementioned appeal taken by the loses its
award, as long as he did not reserve his right to file a complainant. In the language of jurisdiction over
separate civil action or has not waived his right to this Court, in People vs. Ursua (60 the case, the
civil indemnity arising from the offense (105 Phil. Phil. 252, 254-255): offended party
1287-1288; see also People vs. Rodriguez, 97 Phil. The right of the would be
349; People vs. Ursua, 60 Phil. 252; People vs. injured persons in deprived of his
Celorico, 67 Phil. 185). In said Coloma case, Chief an offense to take right to appeal,
Justice, then Associate Justice, Roberto Concepcion, part in its although fifteen
stated the rationale, thus: prosecution and days have not yet
... every criminal case involves two to appeal for elapsed from the
actions, one criminal and another purposes of the date of the
 judgment, if the sheriff levied upon a house of the also civilly liable
accused files his defendant, who, subsequently, (Art. 100,
appeal before the asked the court to set aside its order Revised Penal
expiration of said on April 5 and said writ of Code). The civil
period. execution. This petition was liability of the
Therefore, if the granted on August 9 upon the accused is
court, ground that the judgment rendered determined in the
independently of on March 24, 1952 became final on criminal action,
the appeal of the that date, he having immediately unless the injured
accused, has begun to serve his sentence, and party expressly
jurisdiction, that, hence, the court had no waives such
within fifteen jurisdiction to enter the order of liability or
days from the April 5, granting indemnity to the reserves his right
date of the offended party. In a unanimous to have civil
judgment, to decision, penned by Mr. Justice damages
allow the appeal Padilla, we held, after quoting determined in a
of the offended from People vs. Ursua, supra, that separate action.
party, it also has the trial court had retained its (Art. 112,
jurisdiction to jurisdiction over the civil phase of Spanish Code of
pass upon the the case, despite service of the Criminal
motion for penalty meted out to the accused, Procedure in
reconsideration and that no error had been relation to sec.
filed by the committed, in the order of April 107 of General
private 5,1952, in ordering him to Orders No. 58;
prosecution in indemnify the offended party in the vide, also, U.S.
connection with amount of P1,000.00, before the vs. Heery, 25
the civil liability expiration of the fifteen (15) days Phil. 600, and
of the accused. period provided for the appeal. cases therein
The case of People vs. Referring now to the issue raised cited.) Here,
Rodriguez (decided on July 29, by the appeal of complainant there was no
1955) is, even more, in point. The herein, it will be recalled that, in waiver or
facts therein were: On March 24, order to justify the absence of an reservation of
1952, Rodriguez was convicted of award for damages in its decision civil liability, and
abduction with consent and of conviction, the lower court said evidence should
sentenced accordingly. Thereupon, therein that "the information failed have been
he commenced to serve the to allege any damages suffered." allowed to
sentence. Three days later, the This was the very reason by the establish the
complainant moved that he be lower court in People vs. Celorico extent of the
ordered to indemnify her. On April (67 Phil. 185, 186), in refusing to injuries by the
5, the court granted this motion and allow the prosecution to prove offended party
ordered Rodriguez to pay her damages, which was eventually and to recover the
P1,000.00, with subsidiary declared erroneous, for the reason same, if proven."
imprisonment in case of that: (Emphasis ours.)
insolvency. On May 7, the "Every person To repeat, the offended parties in the Coloma and
corresponding writ of execution criminally liable Rodriguez cases were allowed to appeal despite the
was issued, and on May 12, the for a felony is fact that the decision of conviction had already
become final and had been executed, either because
the accused had fully served the sentence or was then
serving sentence; and the names of the offended
parties were included in the title of said cases.
In the case at bar, there is greater reason to allow the
appeal to proceed with respect to the civil liability of
the accused as the judgment of conviction did not
become final by reason of the appeal of the accused,
who died during the pendency of the appeal.
Finally, Section 21 of Rule 3 of the Revised Rules of
Court, provides that if defendant dies before the final
judgment in the Court of First Instance, an action for
the recovery of money, debt or interest thereon "shall
be dismissed to be prosecuted in the manner specially
provided in these rules," meaning the claim should be
presented in the testate or intestate proceedings over
the estate of the deceased. The implication is that if
death supervenes after the judgment of the Court of
First Instance but pending appeal in the appellate
court, the action for the recovery of money may not
be dismissed. In such case, the name of the offended
party shall be included in the title of the case as
plaintiff-appellee and the legal representatives or the
heirs of the deceased accused should be substituted as
defendants-appellants.
Consequently, the appeal in the case at bar should
proceed with respect to the right of petitioner herein
as offended party in the criminal case to recover the
civil liability in the amount of P25,000.00 awarded
by the trial court.
WHEREFORE, THE CHALLENGED ORDER
DATED FEBRUARY 20, 1975 IS HEREBY SET
ASIDE, THE APPEAL SHALL PROCEED WITH
RESPECT TO THE ISSUE OF CIVIL LIABILITY
OF THE ACCUSED APPELLANT, AND THE
TITLE OF THE CASE SHALL INCLUDE THE
NAME OF PETITIONER AS OFFENDED PARTY
OR PLAINTIFF-APPELLEE AND THE LEGAL
REPRESENTATIVE OR HEIRS OF THE
DECEASED ACCUSED SUBSTITUTED AS
DEFENDANTS-APPELLANTS. NO COSTS.
Teehankee, Actg. (Chairman), Aquino and Martin,
JJ., concur.
Muñoz Palma, J., concurs in the result.
G.R. No. L-33254 & G.R. No. L-33253 January 20,
1978
THE PEOPLE OF THE PHILIPPINES, plaintiff-
appellee,
vs.
LICERIO P. SENDAYDIEGO, JUAN SAMSON
and ANASTACIO QUIRIMIT, defendants. JUAN
SAMSON anddefendant-appellant.
PROVINCE OF PANGASINAN, offended party-
appellee,
vs.
HEIRS OF LICERIO P.
SENDAYDIEGO, defendants-appellants. *
Norberto J. Quisumbing for appellant Sendaydiego.
Donato & Rillera for appellant Samson.
Office of the Solicitor General for appellee.
AQUINO, J.:
In these three cases of malversation through
falsification, the prosecution's theory is that in 1969
Licerio P. Sendaydiego, the provincial treasurer of
Pangasinan, in conspiracy with Juan Samson y
Galvan, an employee of a lumber and hardware store
in Dagupan City, and with Anastacio Quirimit, the
provincial auditor, as an accomplice, used six (6)
forged provincial vouchers in order to embezzle from
the road and bridge fund the total sum of P57,048.23.
The provincial voucher in these cases has several
parts. In the upper part with the legend "ARTICLE
OR SERVICE" the nature of the obligation incurred
is indicated. That part is supposed to be signed by
two officials of the provincial engineer's office and
by the governor's representative.
The middle part of the voucher contains five
numbered printed paragraphs. Paragraph 1 is a
certificate to be signed by the creditor. It is stated
therein that the creditor vouches that the expenses
"were actually and necessarily incurred". In the
instant cases paragraph 1 was not signed presumably
because it is not relevant to the purchase of materials
for public works projects.
Paragraph 2 is a certification that the expenses are
correct and have been lawfully incurred. It is signed
by the provincial engineer.
Paragraph 3 contains these words: "Approved for pre-
audit and payment, appropriations and funds being
available therefore." This is signed by the provincial
treasurer.
Paragraph 4 is a certification which, as filed up in
Exhibit K, Voucher No. 10724 dated February 28,
1969, reads:
I certify that this voucher has been
pre-audited and same may be paid
in the amount of sixteen thought
seven hundred twenty-seven and
52/100 (P16,727.52) in cash or in
check, provided there is sufficient
fund cover the payment.
This is signed by the auditor.
Paragraph 5 is a certification signed by the provincial
treasurer that the account mentioned in the provincial
engineer's certification "was paid in the amount and
on the date shown below and is chargeable as shown
in the summary hereof. ... ." It may be noted that the
provincial treasurer signs two part of the voucher.
Following paragraph 5, and as referred to therein, is
the receipt of the signed by the creditor. As
accomplished in Exhibit K, the receipt reads (it was
signed according to the prosecution by Juan Samson,
a point which is disputed by him):
Received this 31st day of March,
1969, from L P. Sendaydiego,
Province of Pangasinan the sum of
seven hundred twenty-seven pesos
& 52/100 (16,727.52) in full
payment of the above stated
account, which I hereby certify to
be correct. Paid by Check No.
.................................
CARRIED CONSTR. SUPPLY
CO. By: (Sgd.) JUAN SAMSON
According to the prosecution, Samson also signed on
the left margin of the six vouchers below the stamped
words: "Presented to Prov. Treasurer. By Juan
Samson."
Voucher No. 10724 (Exh. K). — This Provincial
voucher, dated February 28, 1969, evidences the
payment of PI 6,727.52 to the Carried Construction
Supply Co. of Dagupan City for lumber and hardware
materials supposedly used in the repair of the bridge
in Barrio Libertad at the Umingan-Tayug road in
Pangasinan along the Nueva Ecija boundary (Exh.
K). The voucher makes reference to invoice No. 3327
and other supporting papers.
The falsity of that provincial voucher is proven by the
following intances:
(a) That there was no project for the repair of the
bridge at Barrio Libertad (P. 1; Exh. Z).
(b) That the amount of P16,727.52 was never
received by the Carried Construction Supply Co The
alleged official receipt No. 3025 of the company
dated March, 1969 (Exh. K-6) is forged.
(c) That the lumber and materials mentioned in
Exhibit K were never delivered by the company to
the provincial government
(d) That in the provincial voucher, Exhibit K, and in
the supporting requisition and issue voucher (RIV)
No. 2206 dated January 29, 1969 (Exh. A), covering
the same lumber and hardware ma the signatures of
the following office were forged: Salvador F.
Oropilla senior civil engineer; Rodolfo P. Mencias,
supervising civil engineer Victoriano M. Sevilleja,
acting provincial engineer, and Ricardo B.
Probincias, chief of equipment of the governor's
office. These four office denied that their signatures
in the two vouchers, Exhibits A and B, are their
genuine signatures.
(e) That the imprint of the rubber stamp on Exhibits
A and B, containing the words "Approved: For and
By Authority of the Governor (signed) Ricardo B.
Primicias, Chief of Equipment", is not the imprint of
the genuine rubber stamp used in Primicias office.
(f) That charge invoice No. 3327 of the Carried
Construction Supply Co. dated February 18, 1969,
containing a description and the prices of the lumber
and hardware material (Exh. B), is fake because,
according to Ambrosio Jabanes, the company's
assistant manager, the company's invoice No. 3327
was issued to the Mountain Agricultural College
(Exh. II-1). Oropilla denied that his alleged signature
on Exhibit B is his signature.
(g) That three other documents, supporting the
provincial voucher (Exh. K), were also forged. Those
documents are the taxpayer's cate dated February 10,
1969 (Exh. C) stating that no tax is due on the goods
sold in the fake invoice No. 3327 and the two
certificates as to the samples of lumber allegedly
purchased from the Carried Construction Supply Co.,
(Exh. D and E). Narciso P. Martinez, a district
forester, denied that his signatures in Exhibits D and
E are his signatures.
(h) That Angelo C. Manuel the checker of the
provincial auditor's office, denied that his signature
on the left margin is his signature (Exh. A-10).
The forged character of provincial voucher No.
10724 (Exh. K) is incontrovertible.
Other five forged voucher. — Five other provincial
vouchers evidencing supposed payments of certain
amounts to the Carried Construction Supply Co. for
lumber and hardware materials supposingly used in
the repair of other bridges were also falsified. These
five vouchers are the following:
(1) Voucher No. 11995 dated April
29, 1969 evidencing the payment of
P14,571.81 for number and
hardware materials allegedly used
in the repair of Bayaoas bridge at
the Urbiztondo-Pasibi Road (Exh.
O).
(2) Voucher No. 11869 dated April
15, 1969 evidencing the payment of
P5,187.28 'or lumber and hardware
materials allegedly used in the
repair of the Panganiban bridge at
the UminganTayug Road (Exh. P)
(3) Voucher No. 11870 dated April
28, 1969 evidencing the payment of
P6,290.60 for lumber and hardware
materials allegedly used in the
repair of the Cabatuan bridge at the
Umingan-Guimba Road (Exh. Q).
(4) Voucher No. 11871 dated April
15, 1969 evidencing the payment of
P9,769.64 for lumber and hardware
materials allegedly used in the
repair of the Casabar bridge at the
Binalonan-San Manuel Road (Exh.
R).
(5) Voucher No. 11872 dated April
15, 1969 evidencing the Payment
of P4,501.38 for lumber and
hardware materials allegedly used
in the repair of the Baracbac bridge
at the Umingan-Guimba Road
(Exh. S).
As in the case of voucher No. 10724 (Exh. K),
Oropilla, Mencias, and Primicias declared that their
signatures in the said five vouchers are not their
genuine signatures. Samson, who hand-carried the
said vouchers for processing, did not turn over to the
provincial auditor's office the papers supporting the
said vouchers after the vouchers had been pre-
audited. Hence, those supporting papers could not be
presented in evidence.
Jabanes, the aforementioned assistant manager of the
Carried Construction Supply Co., testified that the
lumber and hardware materials mentioned in the five
vouchers were never delivered by his company to the
provincial government. The charge invoices
mentioned in the said vouchers were cancelled
invoices issued to the Mountain Agricultural College.
The projected repairs of the bridges were fictitious.
The company's cashier testified that the company
never received the payments for the lumber and
hardware materials. The receipts evidencing
payments (Exh. K-6, KK to KK-4 are fake official
receipts. The cashier produced in court the genuine
official receipts (Exh. LL to LL-7) bearing the serial
numbers of the fake receipts. The genuine receipts do
not refer to transactions with the provincial
government.
Samson played a stellar role in the processing of the
six vouchers. He used to be an employee of the pro
treasurer's office. He resigned and worked with
several firms doing business with the provincial
government. In 1969 he was the collector of the
Carried Construction Supply Co. He represented that
firm in its dealings with the offices of the governor,
provincial auditor, provincial engineer and provincial
treasurer. He was personally known to those
provincial officials and the employees of their offices
(21-22 Sendaydiego's brief).
The six (6) forged provincial vouchers, with their
respective supporting papers, were hand-carried by
Samson. He delivered the papers to Carmencita
Castillo, the ledger clerk in the provincial engineer's
office, for recording and for her signature (Ekh. DD).
Thereafter, Samson brought the papers to the
provincial treasurer's office. Marcelo Crusade, a
laborer in that office who performed the chore of
recording the vouchers and payrolls, recorded
Vouchers Nos. 11869, 11871 and 11872 (Exh. P, R
and S). Crusadas initials appear on the upper lefthand
corner of the said vouchers with the date 4/17/69.
Samson signed on the left margin of the vouchers to
indicate that he presented them to the provincial t r's
office. Crusade said that after Samson had presented
the said papers to him, Samson brought them to
Ricardo Baraan, the book-keeper of the provincial
treasurer's office for processing and for the latter's
signature (Exh. WW).
From Baraan's office, Samson hand-carried the
vouchers to the provincial auditor's office. He asked
Virginia Cruz, a clerk to record the same (Exh. CC).
Afterwards, Samson asked Donato Rosete the
assistant provincial treasurer, to initialled the voucher
After Rosete had initialled the vouchers, Samson
went to the provincial treasurer's office where the
amounts covered by the voucher were paid by
Sendaydiego to him in cash (instead of by check) as
representative of the Carried Construction Supply Co.
(Exh. EE). He received the payments on March 31
and April 29 and 28 (four payments on that date) as
shown on the face of the vouchers.
The signature of Sendaydiego and Quirimit, the
auditor, on the said six vouchers are admittedly
authentic. Sendaydiego signed the vouchers ahead of
Rosete, his assistant. Sendaydiego's defense is that he
signed the vouchers in the honest belief that the
signatures therein of the provincial office concerned
were genuine because the voucher had been pre-
audited and approved by the auditor.
Samson denied the authenticity of his two signatures
on each of the six vouchers showing that he received
from Sendaydiego the amounts covered thereby as
representative of the lumber and hardware firm (Exh.
OO to TT) and that he presented the vouchers to the
provincial s treasurer 's office (Exh. 6-12 —
Samson). Sendaydiego testified that Samson's
signatures are genuine.
In connection with the six vouchers, Sendaydiego,
Samson and Quirimit were charged with
malversation through falsification in three docketed
as follows:
 1. Criminal Case No. 23349
involving provincial voucher No.
10724 dated February 28, 1969 in
the sum of P16,7Z7.52 (Exh. X), L-
33252.
2. Criminal Case No. 23350
involving provincial vouchers Nos.
11869, 11870, 11871 dated April
15 (two dates) 28 and 15, 1969 for
the respective amounts of
P5,187.28, P6,290.60, P9,769-64
and P4,501.38 (four vouchers, Exh.
P, Q, R and S), now L-33253.
3. Criminal Case No. 23351
involving provincial voucher No.
11955 dated April 29, 1969 in the
sum of P14,571.81 (Exh. O), now
L-33254.
After trial the lower court acquitted the auditor,
Quirimit and found Sendaydiego and Samnson guilty
of malversation through falsification of public or
official documents imposing each of the following
penalties:
(1) In Criminal Case No. 23349, an
indeterminate sentence of twelve
years, ten months and twenty-one-
days, as minimum, to eighteen
years, two months and twenty-one
days of reclusion temporal, as
maximum, and a fine of P16,727.52
and to indemnify solidarity the
provincial government of
Pangasinan in the same amount;
(2) In Criminal Case No. 23350,
the penalty of reclusion
perpetua and a fine of P29,748.90
and to indemnify solidarily the
provincial government of
Pangasinan in the same amount;
and
(3) In Criminal Case No. 23351, an
indeterminate sentence of twelve
years, ten months and twenty-one
days, as minimum, to eighteen year
two months and twenty-one days
of reclusion temporal as maximum
, and a fine of P14,571.81 and to
indemnify solidarity the provincial
government of Pangasinan in the
same amount.
Sendaydiego and Samson appealed to this Court.
Sendaydiego died on October 5, 1976. His appeal as
to his criminal liability was dismissed. Death
extinguished his criminal liability remained. The
resolution of July 8, 1977 dismissing Sendaydiego's
appeal read s follows:
The death of appellant Sendaydiego
during the pendency of his appeal
or before the judgment of
conviction rendered against him by
the lower court became final and
executory extinguished hiscriminal
liability meaning his obligation to
serve the personal or imprisonment
penalties and his liability to pay the
fines or pecuniary penalties (Art.
89[1], Revised Penal Code; 1
Viada, Codigo Penal, 4th Ed., 565).
The claim of complainant Province
of Pangasinan for the civil
liability survived Sendaydiego
because his death occurred after
final judgment was rendered by the
Court of First Instance of
Pangasinan, which convicted him
of three complex crimes of
malversation through falsification
and ordered him to indemnify the
Province in the total sum of
P61,048.23 (should be P57,048.23).
The civil action for the civil
liability is deemed impliedly
instituted with the criminal action
in the absence of express waiver or
its reservation in a separate action
(Sec. 1, Rule 111 of the Rules of
court). The civil action for the civil
liability is separate and distinct
from the criminal action (People
and Manuel vs. Coloma, 105 Phil.
1287; Roa vs. De la Cruz, 107 Phil.
8).
When the action is for the recovery
of money and the defendant dies
before final judgment in the Court
of First Instance, it shall be
dismissed to be prosecuted in the
manner especially provided' in Rule
87 of the Rules of Court (Sec. 21,
Rule 3 of the Rules of Court).
The implication is that, if the
defendant dies after a money
judgment had been rendered
against him by the Court of First
Instance, the action survives him. It
may be continued on appeal
(Torrijos vs. Court of Appeals, L-
40336, October 24, 1975; 67 SCRA
394).
The accountable public officer may
still be civilly liable for the funds
improperly disbursed although he
has no criminal liability (U S. vs.
Elvina, 24 Phil. 230; Philippine
National Bank vs. Tugab, 66 Phil.
583).
In view of the foregoing,
notwithstanding the dismissal of
the appeal of the deceased
Sendaydiego insofar as his criminal
liability is concerned, the Court
Resolved to continue exercising
appellate jurisdiction over his
possible civil liability for the
money claims of the Province of
Pangasinan arising from the alleged
criminal acts complained of, as if
no criminal case had been instituted
against him, thus making
applicable, in determining his civil
liability, Article 30 of the Civil
Code (Note: The lower court had
issued an order of attachment
against him on January 13, 1970
for the sum of P36,487 and in the
brief for said appellant, there is no
specific assignment of error
affecting the civil liability fixed by
 the trial court.) and, for that
purpose, his counsel is directed to
inform this Court within ten (10)
days of the names and addresses of
the decedent's heirs or whether or
not his estate is under
administration and has a duly
appointed judicial administrator.
Said heirs or administrator will be
substituted for the deceased insofar
as the civil action for the civil
liability is concerned (Secs. 16 and
17, Rule 3, Rules of Court).
According to Sendaydiego's brief,
he had a wife and ten children
named Arturo, Licerio, Jr.,
Prospero, Regulo, Eduardo, Cesar,
Nola, Aida, Wilfredo and Manolo
(deceased).
The title of this case should be
amended to show its civil aspect by
adding thereto the
following.Province of Pangasinan
vs. Heirs of Licerio P.
Sendaydiego.
Sendaydiego's appeal will be resolved only for the
purpose of showing his criminal liability which is the
basis of the civil liability for which his estate would
be liable for which his estate would be liable.
Sendaydiedo's appeal; civil liability of his estate. —
In view of Sendaydiego's death, it is not necessary to
resolve his first two assignments of error, wherein he
assails the imposition of reclusion perpetua as a cruel
and unusual penalty and wherein it is argued that
there is no complex crime of malversation through
falsification committed by negligence.
In the third assignment of error, it is contended that
the trial court erred in allowing private prosecutors
Millora and Urbiztondo to prosecute the case thereby
allegledly subjecting the accused to proceedings
marked by undue publicity, pre-judgment, bias and
political self-interest.
Atty. Vicente D. Millora, a senior member of the
provincial board actually handled the prosecution of
the case from the preliminary investigation, which
started on June 5, 1969, up to the termination of the
trial on July 29, 1970.
At the commencement of the preliminary
investigation, the counsel for the accused auditor
inquired whether Atty. Millora was authorized by the
provincial board to act as private prosecutor in
representation of the province of Pangasinan, the
offended party. Atty. Millora replied that there was a
board resolution designating him as a private
prosecutor.
The acting provincial commander, who filed the
complaints manifested to the trial court that he had
authorized Atty. Millora to act as private prosecutor
(4-8 tsn June 5, 1969).
Another defense counsel filed a written motion to
inhibit Millora and the others as private prosecutors.
The lower court denied the motion in its order of
June 18, 1969 (p. 40, Record of Criminal Case No.
23350).
After the termination of the p investigation conducted
by the lower court, the provincial fiscal of
Pangasinan and the city final of Dagupan City filed
three informations against the accused all dated
November 4, 1969.
At the commencement of the trial on February 23,
1970 the city fiscal, an assistant provincial fiscal and
Atty. Millora, the private prosecutor, appeared for the
prosecution. The city fiscal moved "that the private
prosecutor (Millora) be authorized to conduct the
examination subject to our (the fiscal's) control and
supervision". The trial court granted the motion (7
tsn).
At the hearing on April 23, 1970 the same city fiscal
moved that Atty. Urbiztondo be authorized to
examine the prosecution witnesses under his
supervision and control The trial court granted the
motion (155 tsn).
The record shows that at every hearing the provincial
fiscal, the city fiscal or an assistant fiscal were
present together with the private prosecutor.
Under the foregoing circumstances, we believe that
there was substantial compliance with the rule that
the criminal action should be "prosecuted under the
direction and control of the fiscal" and that "the
provincial fiscal shall represent the province" in any
court (Sec.4, Rule 110, Rules of Court; sec. 1683,
Revised Administrative Code).
The observation of Sendaydiego's counsel, that the
imposition of reclusion perpetua "could have been
the result of the undue publicity, prejudgment, bias
and political interest which attended the proceedings
", is not well-founded. The trial court's decision
dispels any doubt as to its impartiality. The evidence
in the three cases is mainly documentary. The
unassailable probative value of the documents
involved rather than bias and prejudice, was the
decisive factor on which the trial court anchored the
judgment of conviction.
Moreover, as already adverted to, Sendaydiego's
death had rendered moot the issue as to the propriety
of the imposition of reclusion perpetua. And, as will
be shown later, reclusion perpetua cannot be
imposed in these cases because the crimes committed
were not complex.
The other seven assigmments of error made by
Sendaydiego's counsel refer to the trial court's
conclusion that Sendaydiego and Samson are guilty
beyond reasonable doubt of malversation through
falsification or, specifically, that the provincial
treasurer, in signing the six vouchers, evinced
"malice or fraud and that there must have been
connivance between" the two.
Several lances indicate that Sendaydiego conspired
with Samson. Donato N. Rosete, the assistant
provincial treasurer, testified that, contrary to the
usual procedure, he affixed his initial to paragraph 3
of the vouchers after Sendaydiego had signed it.
Rosete adhered to that unusual procedure because the
interested party, Samson who hand-carried the
vouchers, approached Rosete after he (Samson) had
conferred with the provincial treasurer and Samson
told Rosete to initial the voucher because it was
areglado na (already settled) since the treasurer had
already signed the voucher (54 tsn July 3, 1969).
Rosete's testimony and affidavit confute appellant
Sendaydiego's contention that the trial court erred in
finding that he signed the questioned vouchers before
Rosete had placed his initial in them. After the
treasurer had signed the voucher, Rosete's duty to
initial it was only ministerial (75 tsn July 3, 1969).
The bookkeeper in the treasurer's office testified that
he indicated in the vouchers that the amounts covered
thereby should be paid in cash. That indication was
made by means of the symbol "A-1-1" placed at the
bottom of the vouchers under the column "Account
Number". The bookkeeper was in. instructed by
Samson to place that symbol Samson told him that he
(Samson) had an understanding with Treausrer
Sendaydiego that the payment should be made in cas.
There were instances when the treasurer insisted on
payment by check to creditors other than Juan
Samson.
The cash payments were made to Samson in the inner
office of the provincial treasurer where the cashier
was summoned to make the cash payments (11-12
ton July 9, 1969; p. 11, Exh. EE). As noted by the
trial court, it was unusual that the payments should be
made in the treasurer's office when that was a
ministerial chore of the cashier.
The cash payments were made to Samson even if
Samson had no power of attorney from the Carried
Construction Supply Co. authorizing him to receive
the payments. The space in the vouchers for the
signature of the witness, who should be present when
the payments were received, was blank. The treasurer
did not bother to have a witness to attest to the
payments or to require the exhibition of Samson's
residence certificate.
Another apt observation of the trial court is that the
forged character of the six vouchers would have been
unmasked by the supposed creditor, Carried
Construction Supply Co., if the payments had been
made by means of checks. The company on receiving
the checks would have returned them to the treasurer
because it knew that there was no reason to make any
payments at all. The trial court said that the cash
payments prove Sendaydiego's collusion with
Samson.
Sendaydiego's counsel assails the lower court's
finding that there was a conspiracy between the
provincial and Samson as shown by the fact that the
amounts covered by the vouchers were paid to
Samson by the cashier in the treasurer's inner office.
That point was testified to by Rosete, the assistant
provincial treasurer.
The cashier, Napoleon Ulanday, would have been the
beet witness on how and where the payments were
made. However, Ulanday died before the preliminary
investigation was started. On May 27, 1969, after the
anomalies were unearthed, he wrote a letter to the
provincial , stating that he paid to Samson the
amounts covered by five vouchers in the of Salazar
K. Misal and Josefina E. Pulido (Exh. 13).
Rosete was in a position to state that the cash
payments were made to Samson in the treasurers
inner office because his table was near the main door
of the treasurers office or was about fifteen meters
away (18 tsn). Rosete always knew when the cashier
went to the treasurers office because the cashier was
oned by means of a buzzer (long buzz), and when the
cashier came out of the treasurer's office, he would be
holding the voucher (12-13 tsn).
Sendaydiego's counsel that no gross negligence can
be imputed to the treasurer (malversation is a crime
which can be committed by means
of dolo or culpa and the penalty in either case is the
same). This argument does not deserve serious
consideration because the facts proven by the
prosecution show that he had a tieup with Samson
and that he acted maliciously in signing the six
questioned vouchers.
The last contention put forward for Sendaydiego is
that, because the trial court acquitted the auditor, then
the treasurer's exoneration follows as a matter of
course. We see no merit in that contention because
the evidence for the prosecution against Sendaydiego
is not the same as its evidence against the auditor. For
that reason the auditor was charged only as an
accomplice, whereas, the treasurer was charged as a
principal. The auditor based his defense on the
undeniable fact that the treasurer had approved the
six vouchers "for pre-audit and payment" before they
were passed upon by the auditor. In short, the auditor
was misled by the treasurer's certification which the
auditor apparently assumed to have been made in
good faith when in truth it was made in bad faith.
We are convinced after a minutiose examination of
the documentary and oral evidence and an
unprejudiced consideration of the arguments of
Sendaydiego's counsel that his criminal liability was
established beyond reasonable doubt and, therefore,
the civil liability fo his estate for the amounts
malversed was duly substantial.
Samson's appeal. — Samson's brief has no statement
of facts. He contends that the trial court erred in
disregarding the expert testimony that his signatures
on the vouchers are not his signature; in finding that
he forged the vouchers and received the proceeds
thereof, and in relying on circumstantial evidence as
proof of conspiracy.
As a preliminary issue, Samson argues that Judge
Eloy B. Bello should have inhibited himself "in
fairness to the accused, in the interest of justice, and
as a gesture of delivadeza" because he had conducted
the preliminary investigation.
Our searching study of the recrod fails to sustain
Samson's insinuation that he was prejudiced by the
fact that Judge, who conducted the preliminary
investigation, was the one who tried the case and
convicted him. Judge Bello tried the case fairly. His
conduct of the trial does not show that he had already
prejudged their guilt.
Section 13, Rule 112 of the Rules of court, in
allowing a Court of First Instance to conduct a
preliminary investigation, does not disqualify it from
trying the case after it had found probable cause and
after the fiscal, as directed by the Court, had filed the
corresponding information. The rule assumes that the
Judge, who conducted the preliminary investigation,
could impartially try the case on the merits.
We cannot assume that judges as a rule are
opinionated and narrow-minded insomuch that they
would invariably be iron-bound by their findings at
the preliminary investigation.
The case of a Judge of the Court of First Instance,
who conducts a preliminary investigation and then
tries the case on the merits, is similar to a situation
where an inferior court conducts a preliminary
investigation of a grave or less grave offense falling
within the concurrent jurisdiction of the Court of
First Instance and tghe inferior court. In such a case,
the inferior court after terminating the preliminary
investigation is not obligated (por delivadeza) to
remand the case to the Court of First Instance for
trial. The inferior court has the option to try the case
on the merits (People vs. Palmon, 86 Phil. 350;
Natividad vs. Robles, 87 Phil. 834; People vsw.
Colicio, 88 Phil. 196). The assumption is that the
inferior court can try the case without any ingrained
bias or undue prejudice.
Samson sought to prove, through Lieutenant Colonel
Jose G. Fernandez, retired chief of the Constabulary
crime laboratory, a handwriting expert, that his
signatures on the vouchers are not his signatures.
Fernandez found that the questioned signatures and
the alleged genuine signatures (exemplars) of
Samson have fundamental differences. The expert
concluded that the questioned signatures and the
exemplar signatures of Samson were not written by
one and the same person (Exh. 20).
After examining the questioned and genuine
signatures and analysing the evidence and
contentions of the parties, we find that the expert is
correct in declaring that (as admitted by the trial
court) there are radical differences between the
questioned and authentic signatures.
But the expert is in error in concluding that Samson
did not forge the questioned signatures or in implying
that Samson had no hand in the writing thereof.
The truth is that Samson used two forms of signature.
His supposed genuine signatures found in his
residence certificates, income tax returns and the
genuine office receipt of the Carried Construction
Supply Co. are "in an arcade form or rounded form of
writing". The surname Samson is encircled.
On the other hand, the questioned signatures used in
Samson's transactions with the provincial government
are in angular form; his surname is not encircled, and
the questioned signatures terminate in angular and
horizontal strokes.
Samson was consistent in his fakeries. Knowing that
the six vouchers evidenced fictitious transactions, he
used therein his fake signature, or the signature which
is different from his signature in genuine documents.
He used his forged signatures in the six fake official
receipts of the Carried Construction Supply Co.,
stating that the amounts covered by the six vouchers
were received by him (Exh. K-6, KK to KK-4). the
expert admitted that a person may have two forms of
signature (186 tsn July 16, 1970).
Signatures may be deliberately disguised with the
dishonest intention of denying the same as and when
necessary (Mehta, Identification of Handwriting and
Cross Examination of Experts, pp. 4th Ed., 1970, p.
224; Harrison, Suspect Documents 418-419).
Sendaydiego himself testified that the questioned
signatures of Samson in the six vouchers were
Samson's signatures (94-99 tsn July 31, 1969).
Fernandez, the handwriting expert, declared that the
questioned signatures of Samson in the vouchers
were written by only one person (264-265 tsn July
16, 1970).
The evidence conclusively proves that Samson, as the
representative or collector of the supposed creditor,
Carried Construction Supply Co., hand-carried the
vouchers in question to the offices of the provincial
engineer, treasurer and auditor and then back to the
treasurer's office for payment. He actually received
the cash payments. Under those circumstances,
Samson is presumed to be the forger of the vouchers.
The rule is that if a person had in his possession a
falsified document and be made use of it (uttered it),
taking advantage of it and profiting thereby, the
presumption is that he is the material author of the
falsification. This is especially true if the use or
uttering of the forged documents was so closely
connected in time with the forgery that the user or
possessor may be proven to have the capacity of
committing the forgery, or to have close connection
with the forgers, and therefore, had complicity in the
forgery. (U.S. vs. Castillo, 6 Phil., 453; People vs. De
Lara, 45 Phil. 754; People vs. Domingo, 49 Phil. 28;
People vs. Astudillo, 60 Phil. 338 People vs.
Manansala, 105 Phil. 1253).
In the absence of a satisfactory explanation, one who
is found in possession of a forged document and who
used or uttered it is presumed to be the forger
(Alarcon vs. Court of Appeals, L-21846, March 31,
1967, 19 SCRA 688; People vs.Caragao, L-28258,
December 27, 1969, 30 SCRA 993).
Samson's use of one form of signature for his crooked
transactions with the provincial government and
another form of signatures of his valid transactions or
papers shows the deviousness of the falsifications
perpetrated in these cases. (Note that Sendaydiego
signed the certification in the first voucher, Exhibit
K, stating that proceeds thereof were paid to
Samson but Sendaydiego did not sign the same
certification in the other five forged vouchers,
Exhibits O, P, Q, R and S).
As to the question of conspiracy, the statement of
Samson's on page 19 of his brief, that "the trial court
made absolutely no finding of any supposed
conspiracy' between Samson and Sendaydiego, is not
correct.
We have already noted that the trial court explicitly
stated that the circumstance that Sendaydiego signed
the six vouchers ahead of his assistant shows that
there was "malice or fraud" on the part of
Sendaydiego and that there was conivance between
Samson and Sendaydiego when the proceeds of the
vouchers were paid to Samson in Sendaydiego's inner
office, instead of in the cashier's office (p. 23, 26,
Decision, Appendix to Samson's brief). The trial
court said that the fact that Sendaydiego allowed
payment in cash shows "his collission with Samson
(Ibid, p. 26).
Samson's contention that the trial court merely
conjectured that he had received the proceeds of the
vouchers is not well taken. The trial court's finding
on that point is based on very strong circumstantial
evidence (assuming that it was not proven that
Samson signed the vouchers).
Samson vehemently argues that there is no evidence
that the total sum of P57,048. 23 paid under the six
vouchers "was really misappropriated". He asserts
that the six vouchers are genuine (although he
contends that his signatures thereon are forgeries) and
that there is no proof that the amounts covered
thereby were not paid for the construction materials
shown in the six vouchers were never delivered by
the company (Exh. HH).
These contentions appear to be untenable in thelight
of the declaration of Jabanes, the assistant manager of
Carried Construction Supply Co., the alleged
supplier, that the materials shown in the six vouchers
were never delivered by the company (Exh. HH).
And Leticia Sevilleja (wife of the provincial
engineer), who was employed as cashier of the
carried Construction Supply Co., denied that Samson
turned over to the company the proceeds of the six
vouchers which he was supposed to have collected
for the company from Sendaydiego. The six vouchers
appear to be fake principally because they evidence
fictitious sales of construction materials.
Under the said circumstances, it cannot be contended
that there was no malversation after Sendaydiego
admtte that Samson acknowledged in the six
vouchers that he received from Treasurer
Sendaydiego the total sum of P57,048.23.
The assertion of Samson's counsel on pgae 29 of his
brief, that the finding as to his guilt is based on a
shaky foundation or is predicated on circumstances
which wre not proven, is not correct.
Recapitulations. — In resume, it appears that the
provincial treasurer wants to base his exculpation on
his belief that in the six vouchers the signatures of
Samson and the officials in the provincial engineer's
office appeared to be genuine and on the fact that the
auditor had approved the vouchers. The tresurer
claimed that he acted in good faith in approving the
payments of the proceeds of the vouchers to Samson
as the representative of the supplier, Carried
Construction Co.
On the other hand, Samson, by impugning his
signatures in the vouchers, denied that he received
the said amounts from the cashier of the treasurer's
office.
These conflicting versions of the treasurer and
Samson have to be resolved in the light of the
inexpugnable fact that Samson had hand-carried the
voucehrs and followed up their processing in the
offices of the provicial government the construction
materials described in the six vouchers and denied
having received from Samson the prices of the
alleged sales.
The result is the Samson's denial of his signatures in
the six vouchers and in the six receipts (Exh. K-6 and
KK to KK-4) and the provicial treasurer's pretension
of having acted in good faith or having committed an
honest mistake have to be disbelieved.
The unavoidable conclusion is that Sendaydiego and
Samson were in cahoots to defraud the provincial
government and to camouflage the defraudation by
means of the six vouchers which have some genuine
features and which appear to be extrinsically
authentic but which were intrinsically fake.
Penalties. — The trial court and the assumed that
three complex crimes of malversation through
falsification of public documents were committed in
this case. That assumption is wrong.
The crimes committed in these three cases are not
complex. Separate crimes of falsification and
malversation were committed. These are not cases
where the execution of a single act constitutes two
grave or less grave felonies or where the falsification
was used as a means to commit malversation.
In the six vouchers the falsification was used
to conceal the malversation. It is settled that if the
falsification was resorted to for the purpose of hiding
the malversation, the falsification and malversation
are separate offenses (People vs. Cid, 66 Phil 354;
People vs. Villanueva, 58 Phil. 671; People vs.
Geralde 52 Phil. 1000; People vs. Regis, 67 Phil. 43).
In the Regis case, supra where the modus operandi is
similar to the instant cases, the municipal treasurer
made it appear in two official payrolls dated April .30
and May 2, 1931 that some persons worked as
laborers in a certain street project at Pinamungahan,
Cebu. In that way, the two amounts covered by the
payrolls, P473.70 and P271.60, were appropriated
and taken from the municipal funds. As a matter of
fact, no such work was done in the said street project
and the persons mentioned in both payrolls had not
performed any labor.
It was held in the Regis case, that the falsification and
malversation did not constitute a complex crime
because the falsifications were not necessary means
for the co on of the malversations. Each falsification
and each malversation constituted independent
offenses which must be punished separately.
The municipal treasurer was convicted of two
falsifications and two malversations. Four distinct
penalties were imposed.
In the instant cases, the provincial , as the custodian
than of the money forming part of the road and
bridge could have malversed or misappropriated it
without falsifiying any voucher. The falsification was
used as a device to prevent detection of the
malversation.
The falsifications cannot be regarded as constituting
one continuing offense impelled by a single criminal
impulse.
Each falsification of a voucher constitutes one crime.
The falsification of six vouchers constitutes six
separate or distinct offenses (People vs. Madrigal-
Gonzales, 117 Phil. 956).
And each misappropriation as evidenced by a
provincial voucher constitutes a separate crimes of
malversation were committed. Appellant Samson is a
co-principal in each of the said twelve offenses.
As already stated, he is presumed to be the author of
the falsification because he was in possession of the
forged vouchers and he used them in order to receive
public monies from the provincial treasurer.
He is a co-principal in the six crimes of malversation
because he conspired with the provincial treasurer in
committing those offenses. The trial court correctly
ruled that a private person conspiring with an
accountable public officer in committing
malversation is also guilty of malversation (People
vs. Rodis, 105 Phil. 1294; U.S. vs. Ponte, 20 Phil.
379; U.S. vs. Dato and Lustre, 37 Phil. 359; U.S. vs.
Dowdell, 11 Phil. 4; People vs. Caluag, 94 Phil. 457).
Note that a different rule prevails with respect to a
stranger taking part in the commission of parricide or
qualified theft. In such cases, the stranger is not
guilty of parricide or qualfied theft but only of
murder or homicide, as the case may be, and simple
theft, by reason of paragraph 3, article 62 of the
Revised Penal Code (People vs. Patricio, 46 Phil.
245).
Falsification of a public document committed by a
private person is punished in article 172(1) of the
Revised Penal Code by prision correccional in its
medium and maximum periods and a fine of not more
than P5,000.
For the malversation of the sum of P5,187.28 and
P4,501.38, respectively covered by vouchers Nos.
11869 and 11872 (Exh. P and S), the penalty
provided in paragraph 2 of article of the Revised
Penal Code is prision mayorminimum and medium.
For the malversation of the sums of P6,290.60
andP9,769.64, respectively covered by vouchers Nos.
1187 and11871 (Exh. Q and R) the penalty provided
in paragraph 3 of article 217 is prision
mayor maximum to reclusion temporal minimum.
For the malversation of the sums of P16,727.52 and
10995 (Exh. K and O), the penalty provided in
paragraph 4 of article 217 is reclusion
temporal medium and maximum.
In each of the malversation cases, a fine equal to the
amount malversed should be added to the
imprisonment penalty.
In the twelve cases the penalty should be imposed in
the medium peiod since there are no modifying
circumstances (Arts. 64[1] and 685, Revised Penal
Code). Samson is entitled to an indeterminate
sentence.
WHEREFORE, Samson is convicted of six crimes of
falsification of a public document and six crimes of
malversation.
In lieu of the penalties imposed by the trial court, he
is sentenced to the following penalties:
For each of the six falsification of the vouchers (Exh.
K, O, P, Q, R and S), Samson is sentenced to an
indeterminate penalty of two (2) years of prison
correccional minimum, as minimum, to four (4)
years of prision correccional medium, as maximum,
and to pay a fine of three thousand pesos.
For the malversation of the sum of P16,727.52
covered by voucher No. 10724 (Exh. K), Samson is
sentenced to an indeterminate penalty of twelve (12)
years of prision mayor maximum, as minimum, to
seventeen (17) years ofreclusion temporal medium,
as maximum; to pay a fine in the amount of
P16,727.52, and to indemnify the province of
Pangasinan in the same amount (Criminal Case NO.
23349, L-33252).
For the malversation of the sum of P14,571.81
covered by voucher No. 11995 (Exh. O), Samson is
sentenced to an indeterminate penalty of twelve (12)
years of prision mayor maximum, as minimum, to
seventeen (17) years ofreclusion temporal medium,
as maximum; to pay a fine in the sum of P14,571.81,
and to indemnify the province of Pangasinan in the
same amount (Criminal Case No. 23351, L-33254).
For the malversation of the sum of P6,290.60 covered
by voucher No. 11870 (Exh. Q), Samson is sentenced
to an indertiminate penalty of nine (9) years
of prision mayor medium, as minimum, to thirteen
(13) years of reclusion temporal minimum, as
maximum; to pay a fine of P6,290.60, and to
indemnify the province of Pangasinan in the same
amount (Criminal Case No. 23350, L-33253).
For the malversation of the sum of P9,769.64 covered
by voucher No. 11871 (Exh. R), Samson is sentenced
to an indeterminate penalty of nine (9) years
of prision mayor medium, as minimum, to thirteen
(13) years of reclusion temporal minimum, as
maximum; to pay a fine of P9,769.64, and to
indemnify the province of Pangasinan in the same
amount (Criminal Case No. 23350, L-33253).
For the malversation of the sum of P5,187.28,
covered by voucher No. 11869 (Exh. P), Samson is
sentenced to an indeterminate penalty of five (5)
years of prision correccional maximum, as
minimum, to eight (8) of prision mayorminimum, as
maximum; to pay a fine of P5,187.28, and to
indemnify the province of Pangasinan in the same
amount (Criminal Case No. 23350, L-33253).
For the malversation of the sum of P4,501.38 covered
by voucher no. 11872 (Exh. S), Samson is sentenced
to an indeterminate penalty of five (5) years of
prision correccional maximum, as minimum, to eight
(8) years of prision mayor minimum, as maximum; to
pay a fine of P4,501.38, and to indemnify the
province of Pangasinan in the same amount (Criminal
Case No. 23350, L-33253).
In the service of the twelve penalties meted to
Samson, the threefold limit provided for in article 70
of the Revised Penal Code should be observed
(People vs. Escares, 102 Phil. 677), meaning that the
maximum penalty that he should serve is three times
the indeterminate sentence of twelve (12) years to
seventeen (17) years, the severest penalty imposed on
him, or thirty-six (36) years to fifty-one (51) years
(see People vs. Peñas, 68 Phil. 533).
The maximum duration of his sentences should not
exceed forty (40) years (Penultimate par. of art. 70;
People vs. Alisub, 69 Phil. 362; People vs.
Concepcion, 59 Phil. 518, 68 Phil. 530 and 69 Phil.
58).
The estate of the late Licerio P. Sendaydiego is
ordered to indemnify the province of Pangasinan in
the sum of P57,048.23.
Samson and the said estate are sojidarily liable for the
said indemnity (Art. 110, Revised Penal Code).
Samson should pay one-half of the costs.
SO ORDERED.
G.R. No. L-55322 February 16, 1989 court a quo, dated July 27, 1968.
MOISES JOCSON, petitioner, By this document Emilio Jocson
vs. sold to Agustina Jocson-Vasquez
HON. COURT OF APPEALS, AGUSTINA six (6) parcels of land, all located at
JOCSON-VASQUEZ, ERNESTO Naic, Cavite, for the sum of ten
VASQUEZ, respondents. thousand P10,000.00 pesos. On the
MEDIALDEA, J.: same document Emilio Jocson
This is a petition for review on certiorari under Rule acknowledged receipt of the
45 of the Rules of Court of the decision of the Court purchase price, thus:
of Appeals in CA- G.R. No. 63474, promulgated on Na ngayon, alang-alang sa
April 30, 1980, entitled "MOISES JOCSON, halagang SAMPUNG LIBONG
plaintiff-appellee, versus AGUSTINA JOCSON- PISO (P10,000) salaping Pilipino
VASQUEZ and ERNESTO VASQUEZ, defendant- na aking tinanggap ng buong
appellants," upholding the validity of three (3) kasiyahan loob at ang
documents questioned by Moises Jocson, in total pagkakatanggap ay aking
reversal of the decision of the then Court of First hayagang inaamin sa pamamagitan
Instance of Cavite, Branch I, which declared them as ng kasulatang ito, sa aking anak na
null and void; and of its resolution, dated September si Agustina Jocson, na may sapat
30, 1980, denying therein appellee's motion for na gulang, mamamayang Pilipino,
reconsideration. asawa ni Ernesto Vasquez, at
Petitioner Moises Jocson and respondent Agustina naninirahan sa Poblacion, Naic,
Jocson-Vasquez are the only surviving offsprings of Cavite, ay aking ipinagbile ng
the spouses Emilio Jocson and Alejandra Poblete, lubusan at kagyat at walang ano
while respondent Ernesto Vasquez is the husband of mang pasubali ang nabanggit na
Agustina. Alejandra Poblete predeceased her husband anim na pirasong lupa na nasa
without her intestate estate being settled. unang dahon ng dokumentong ito,
Subsequently, Emilio Jocson also died intestate on sa nabanggit na Agustina Jocson, at
April 1, 1972. sa kaniyang tagapagmana o
As adverted to above, the present controversy makakahalili at gayon din nais
concerns the validity of three (3) documents executed kong banggitin na kahit na may
by Emilio Jocson during his lifetime. These kamurahan ang ginawa kong
documents purportedly conveyed, by sale, to pagbibile ay dahilan sa ang
Agustina Jocson-Vasquez what apparently covers nakabile ay aking anak na sa akin
almost all of his properties, including his one-third at mapaglingkod, madamayin at
(1/3) share in the estate of his wife. Petitioner Moises ma-alalahanin, na tulad din ng isa
Jocson assails these documents and prays that they be ko pang anak na lalaki. Ang
declared null and void and the properties subject kuartang tinanggap ko na
matter therein be partitioned between him and P10,000.00, ay gagamitin ko sa
Agustina as the only heirs of their deceased parents. aking katandaan at mga huling
The documents, which were presented as evidence araw at sa aking mga ibang
not by Moises Jocson, as the party assailing its mahahalagang pangangailangan.
validity, but rather by herein respondents, are the [Emphasis supplied]
following: Na nais ko ring banggitin na ang
1) "Kasulatan ng Bilihan ng Lupa," ginawa kong ito ay hindi labag sa
marked as Exhibit 3 (pp. 12-13, ano mang batas o kautusan,
Records) for the defendant in the sapagkat ang aking pinagbile ay
akin at nasa aking pangalan. Ang
mga lupang nasa pangalan ng aking
nasirang asawa ay hindi ko
ginagalaw ni pinakikialaman at
iyon ay dapat na hatiin ng dalawa
kong anak alinsunod sa umiiral na
batas (p. 13, Records.)
2) "Kasulatan ng Ganap na
Bilihan,"dated July 27,1968,
marked as Exhibit 4 (p. 14,
Records). On the face of this
document, Emilio Jocson
purportedly sold to Agustina
Jocson-Vasquez, for the sum of
FIVE THOUSAND (P5,000.00)
PESOS, two rice mills and a
camarin (camalig) located at Naic,
Cavite. As in the first document,
Moises Jocson acknowledged
receipt of the purchase price:
'Na alang-alang sa halagang
LIMANG LIBONG PISO
(P5,000.00) salaping Pilipino na
aking tinanggap ng buong
kasiyahan loob sa aking anak na
Agustina Jocson .... Na ang
halagang ibinayad sa akin ay may
kamurahan ng kaunti ngunit dahil
sa malaking pagtingin ko sa kaniya
... kaya at pinagbile ko sa kaniya
ang mga nabanggit na pagaari kahit
na hindi malaking halaga ... (p. 14,
Records).
3) Lastly, the "Deed of
Extrajudicial Partition and
Adjudication with Sale, "dated
March 9, 1969, marked as Exhibit 2
(p. 10-11, Records), whereby
Emilio Jocson and Agustina
Jocson-Vasquez, without the
participation and intervention of
Moises Jocson, extrajudicially
partitioned the unsettled estate of
Alejandra Poblete, dividing the
same into three parts, one-third
(1/3) each for the heirs of Alejandra
 Poblete, namely: Emilio Jocson,
Agustina Jocson-Vasquez and
Moises Jocson. By the same
instrument, Emilio sold his one-
third (1/3) share to Agustin for the
sum of EIGHT THOUSAND
(P8,000.00) PESOS. As in the
preceding documents, Emilio
Jocson acknowledged receipt of the
purchase price:
Now for and in consideration of the
sum of only eight thousand
(P8,000.00) pesos, which I, the
herein Emilio Jocson had received
from my daughter Agustina Jocson,
do hereby sell, cede, convey and
transfer, unto the said Agustina
Jocson, her heirs and assigns,
administrators and successors in
interests, in the nature of absolute
and irrevocable sale, all my rights,
interest, shares and participation,
which is equivalent to one third
(1/3) share in the properties herein
mentioned and described the one
third being adjudicated unto
Agustina Jocson and the other third
(1/3) portion being the share of
Moises Jocson. (p. 11, Records).
These documents were executed before a notary
public. Exhibits 3 and 4 were registered with the
Office of the Register of Deeds of Cavite on July 29,
1968 and the transfer certificates of title covering the
properties therein in the name of Emilio Jocson,
married to Alejandra Poblete," were cancelled and
new certificates of title were issued in the name of
Agustina Jocson-Vasquez. Exhibit 2 was not
registered with the Office of the Register of Deeds.
Herein petitioner filed his original complaint (Record
on Appeal, p. 27, Rollo) on June 20,1973 with the
then Court of First Instance of Naic, Cavite (docketed
as Civil Case No. TM- 531), and which was twice
amended. In his Second Amended Complaint (pp. 47-
58, Record on Appeal), herein petitioner assailed the
above documents, as aforementioned, for being null
and void.
It is necessary to partly quote the allegation of
petitioner in his complaint for the reason that the
nature of his causes of action is at issue, thus:
8. [With regard the first document,
that] the defendants, through fraud,
deceit, undue pressure and
influence and other illegal
machinations, were able to induce,
led, and procured their father ... to
sign [the] contract of sale ..., for
the simulated price of P10,000.00,
which is a consideration that is
shocking to the conscience of
ordinary man and despite the fact
that said defendants have no work
or livelihood of their own ...; that
the sale is null and void, also,
because it is fictitious, simulated
and fabricated contract x x x (pp.
52-53, Record on Appeal).
[Emphasis supplied]
xxx xxx xxx
12. [With regards the second and
third document, that they] are null
and void because the consent of the
father, Emilio Jocson, was obtained
with fraud, deceit, undue pressure,
misrepresentation and unlawful
machinations and trickeries
committed by the defendant on
him; and that the said contracts
are simulated, fabricated and
fictitious, having been made
deliberately to exclude the plaintiff
from participating and with the
dishonest and selfish motive on the
part of the defendants to defraud
him of his legitimate share on said
properties [subject matter
thereof]; and that without any other
business or employment or any
other source of income, defendants
who were just employed in the
management and administration of
the business of their parents, would
not have the sufficient and ample
means to purchase the said
properties except by getting the
earnings of the business or by
simulated consideration ... (pp. 54-
55, Record on Appeal). [Emphasis
supplied]
Petitioner explained that there could be no real sale
between a father and daughter who are living under
the same roof, especially so when the father has no
need of money as the properties supposedly sold
were all income-producing. Further, petitioner
claimed that the properties mentioned in Exhibits 3
and 4 are the unliquidated conjugal properties of
Emilio Jocson and Alejandra Poblete which the
former, therefore, cannot validly sell (pp. 53, 57,
Record on Appeal). As far as Exhibit 2 is concerned,
petitioner questions not the extrajudicial partition but
only the sale by his father to Agustina of the former's
1/3 share (p. 13, Rollo).
The trial court sustained the foregoing contentions of
petitioner (pp. 59-81, Record on Appeal). It declared
that the considerations mentioned in the documents
were merely simulated and fictitious because: 1)
there was no showing that Agustina Jocson-Vasquez
paid for the properties; 2) the prices were grossly
inadequate which is tantamount to lack of
consideration at all; and 3) the improbability of the
sale between Emilio Jocson and Agustina Jocson-
Vasquez, taking into consideration the circumstances
obtaining between the parties; and that the real
intention of the parties were donations designed to
exclude Moises Jocson from participating in the
estate of his parents. It further declared the properties
mentioned in Exhibits 3 and 4 as conjugal properties
of Emilio Jocson and Alejandra Poblete, because they
were registered in the name of "Emilio Jocson,
married to Alejandra Poblete" and ordered that the
properties subject matter of all the documents be
registered in the name of herein petitioners and
private respondents.
On appeal, the Court of Appeals in CA-G.R. No.
63474-R rendered a decision (pp. 29-42, Rollo) and
reversed that of the trial court's and ruled that:
1. That insofar as Exhibits 3 and 4
are concerned the appellee's
complaint for annulment, which is
 indisputably based on fraud, and
undue influence, is now barred by
prescription, pursuant to the settled
rule that an action for annulment of
a contract based on fraud must be
filed within four (4) years, from the
discovery of the fraud, ... which in
legal contemplation is deemed to
be the date of the registration of
said document with the Register of
Deeds ... and the records admittedly
show that both Exhibits 3 and 4,
were all registered on July 29,
1968, while on the other hand, the
appellee's complaint was filed on
June 20, 1973, clearly beyond the
aforesaid four-year prescriptive
period provided by law;
2. That the aforesaid contracts,
Exhibits 2, 3, and 4, are decisively
not simulated or fictitious
contracts, since Emilio Jocson
actually and really intended them to
be effective and binding against
him, as to divest him of the full
dominion and ownership over the
properties subject of said assailed
contracts, as in fact all his titles
over the same were all cancelled
and new ones issued to appellant
Agustina Jocson-Vasquez ...;
3. That in regard to Exhibit 2, the
same is valid and subsisting, and
the partition with sale therein made
by and between Emilio Jocson and
Agustina Jocson-Vasquez,
affecting the 2/3 portion of the
subject properties described therein
have all been made in accordance
with Article 996 of the New Civil
Code on intestate succession, and
the appellee's (herein petitioner)
remaining 1/3 has not been
prejudiced (pp. 41-42, Rollo).
In this petition for review, Moises Jocson raised the
following assignments of errors:
1. HAS THE RESPONDENT
COURT OF APPEALS ERRED IN
CONCLUDING THAT THE SUIT
FOR THE ANNULMENT OF
CONTRACTS FILED BY
PETITIONERS WITH THE
TRIAL COURT IS "BASED ON
FRAUD" AND NOT ON ITS
INEXISTENCE AND NULLITY
BECAUSE OF IT'S BEING
SIMULATED OR FICTITIOUS
OR WHOSE CAUSE IS
CONTRARY TO LAW, MORALS
AND GOOD CUSTOMS?
II. HAS THE RESPONDENT
COURT OF APPEALS ERRED IN
CONCLUDING THAT THE
COMPLAINT FILED BY
PETITIONER IN THE TRIAL
COURT IS BARRED BY
PRESCRIPTION?
III. HAS THE RESPONDENT
COURT OF APPEALS ERRED IN
NOT DECLARING AS
INEXISTENT AND NULL AND
VOID THE CONTRACTS IN
QUESTION AND IN
REVERSING THE DECLARING
DECISION OF THE TRIAL
COURT? (p. 2, Rollo)
I.
The first and second assignments of errors are related
and shall be jointly discussed.
According to the Court of Appeals, herein petitioner's
causes of action were based on fraud. Under Article
1330 of the Civil Code, a contract tainted by vitiated
consent, as when consent was obtained through fraud,
is voidable; and the action for annulment must be
brought within four years from the time of the
discovery of the fraud (Article 1391, par. 4, Civil
Code), otherwise the contract may no longer be
contested. Under present jurisprudence, discovery of
fraud is deemed to have taken place at the time the
convenant was registered with the Register of Deeds
(Gerona vs. De Guzman, No. L-19060, May 29,1964,
11 SCRA 153). Since Exhibits 3 and 4 were
registered on July 29, 1968 but Moises Jocson filed
his complaint only on June 20, 1973, the Court of
Appeals ruled that insofar as these documents were
concerned, petitioner's "annulment suit" had
prescribed.
If fraud were the only ground relied upon by Moises
Jocson in assailing the questioned documents, We
would have sustained the above pronouncement. But
it is not so. As pointed out by petitioner, he further
assailed the deeds of conveyance on the ground that
they were without consideration since the amounts
appearing thereon as paid were in fact merely
simulated.
According to Article 1352 of the Civil Code,
contracts without cause produce no effect
whatsoever. A contract of sale with a simulated price
is void (Article 1471; also Article 1409 [3]]), and an
action for the declaration of its nullity does not
prescribe (Article 1410, Civil Code; See also, Castillo
v. Galvan, No. L-27841, October 20, l978, 85 SCRA
526). Moises Jocsons saction, therefore, being for the
judicial declaration of nullity of Exhibits 3 and 4 on
the ground of simulated price, is imprescriptible.
II.
For petitioner, however, the above discussion may be
purely academic. The burden of proof in showing that
contracts lack consideration rests on he who alleged
it. The degree of proof becomes more stringent where
the documents themselves show that the vendor
acknowledged receipt of the price, and more so
where the documents were notarized, as in the case at
bar. Upon consideration of the records of this case,
We are of the opinion that petitioner has not
sufficiently proven that the questioned documents are
without consideration.
Firstly, Moises Jocson's claim that Agustina Jocson-
Vasquez had no other source of income other than
what she derives from helping in the management of
the family business (ricefields and ricemills), and
which was insufficient to pay for the purchase price,
was contradicted by his own witness, Isaac Bagnas,
who testified that Agustina and her husband were
engaged in the buy and sell of palay and rice (p. 10,
t.s.n., January 14, 1975). Amazingly, petitioner
himself and his wife testified that they did not know
whether or not Agustina was involved in some other
business (p. 40, t.s.n., July 30, 1974; p. 36, t.s.n., May
24, 1974).
On the other hand, Agustina testified that she was
engaged in the business of buying and selling palay
and rice even before her marriage to Ernesto Vasquez
sometime in 1948 and continued doing so thereafter
(p. 4, t.s.n., March 15, 1976). Considering the
foregoing and the presumption that a contract is with
a consideration (Article 1354, Civil Code), it is clear
that petitioner miserably failed to prove his
allegation.
Secondly, neither may the contract be declared void
because of alleged inadequacy of price. To begin
with, there was no showing that the prices were
grossly inadequate. In fact, the total purchase price
paid by Agustina Jocson-Vasquez is above the total
assessed value of the properties alleged by petitioner.
In his Second Amended Complaint, petitioner alleged
that the total assessed value of the properties
mentioned in Exhibit 3 was P8,920; Exhibit 4,
P3,500; and Exhibit 2, P 24,840, while the purchase
price paid was P10,000, P5,000, and P8,000,
respectively, the latter for the 1/3 share of Emilio
Jocson from the paraphernal properties of his wife,
Alejandra Poblete. And any difference between the
market value and the purchase price, which as
admitted by Emilio Jocson was only slight, may not
be so shocking considering that the sales were
effected by a father to her daughter in which case
filial love must be taken into consideration (Alsua-
Betts vs. Court of Appeals, No. L-46430-31, April
30, 1979, 92 SCRA 332).
Further, gross inadequacy of price alone does not
affect a contract of sale, except that it may indicate a
defect in the consent, or that the parties really
intended a donation or some other act or contract
(Article 1470, Civil Code) and there is nothing in the
records at all to indicate any defect in Emilio Jocson's
consent.
Thirdly, any discussion as to the improbability of a
sale between a father and his daughter is purely
speculative which has no relevance to a contract
where all the essential requisites of consent, object
and cause are clearly present.
There is another ground relied upon by petitioner in
assailing Exhibits 3 and 4, that the properties subject
matter therein are conjugal properties of Emilio
Jocson and Alejandra Poblete. It is the position of
petitioner that since the properties sold to Agustina
Jocson-Vasquez under Exhibit 3 were registered in
the name of "Emilio Jocson, married to Alejandra
Poblete," the certificates of title he presented as
evidence (Exhibits "E', to "J', pp. 4-9, Records) were
enough proof to show that the properties covered
therein were acquired during the marriage of their
parents, and, therefore, under Article 160 of the Civil
Code, presumed to be conjugal properties.
Article 160 of the Civil Code provides that:
All property of the marriage is
presumed to belong to the conjugal
partnership, unless it be proved that
it pertains exclusively to the
husband or to the wife.
In Cobb-Perez vs. Hon. Gregorio Lantin, No. L-
22320, May 22, 1968, 23 SCRA 637, 644, We held
that:
Anent their claim that the shares in
question are conjugal assets, the
spouses Perez adduced not a
modicum of evidence, although
they repeatedly invoked article 160
of the New Civil Code which
provides that ... . As interpreted by
this Court, the party who invokes
this presumption must first prove
that the property in controversy
was acquired during the marriage.
In other words, proof of acquisition
during the coverture is a
condition sine qua non for the
operation of the presumption in
favor of conjugal ownership. Thus
in Camia de Reyes vs. Reyes de
Ilano [62 Phil. 629, 639], it was
held that "according to law and
jurisprudence, it is sufficient to
prove that the Property was
acquired during the marriage in
order that the same may be deemed
conjugal property." In the recent
case ofMaramba vs. Lozano, et. al.
[L-21533, June 29, 1967, 20 SCRA
474], this Court, thru Mr. Justice
Makalintal, reiterated that "the
presumption under Article 160 of
the Civil Code refers to property
acquired during the marriage," and
then concluded that since "there is
no showing as to when the property
in question was acquired...the fact
that the title is in the wife's name
alone is determinative." Similarly,
in the case at bar, since there is no
evidence as to when the shares of
stock were acquired, the fact that
they are registered in the name of
the husband alone is an indication
that the shares belong exclusively
to said spouse.'
This pronouncement was reiterated in the case of
Ponce de Leon vs. Rehabilitation Finance
Corporation, No. L-24571, December 18, 1970, 36
SCRA 289, and later in Torela vs. Torela, No.
1,27843, October 11, 1979, 93 SCRA 391.
It is thus clear that before Moises Jocson may validly
invoke the presumption under Article 160 he must
first present proof that the disputed properties were
acquired during the marriage of Emilio Jocson and
Alejandra Poblete. The certificates of title, however,
upon which petitioner rests his claim is insufficient.
The fact that the properties were registered in the
name of "Emilio Jocson, married to Alejandra
Poblete" is no proof that the properties were acquired
during the spouses' coverture. Acquisition of title and
registration thereof are two different acts. It is well
settled that registration does not confer title but
merely confirms one already existing (See Torela vs.
Torela, supra). It may be that the properties under
dispute were acquired by Emilio Jocson when he was
still a bachelor but were registered only after his
marriage to Alejandra Poblete, which explains why
he was described in the certificates of title as married
to the latter.
Contrary to petitioner's position, the certificates of
title show, on their face, that the properties were
exclusively Emilio Jocson's, the registered owner.
This is so because the words "married to' preceding
"Alejandra Poblete' are merely descriptive of the civil
status of Emilio Jocson Litam v. Rivera, 100 Phil.
354; Stuart v. Yatco, No. L-16467, April 27, 1962, 4
SCRA 1143; Magallon v. Montejo, G.R. No.L-
73733, December 16, 1986, 146 SCRA 282). In other
words, the import from the certificates of title is that
Emilio Jocson is the owner of the properties, the
same having been registered in his name alone, and
that he is married to Alejandra Poblete.
We are not unmindful that in numerous cases We
consistently held that registration of the property in
the name of only one spouse does not negate the
possibility of it being conjugal (See Bucoy vs.
Paulino, No. L-25775, April 26, 1968, 23 SCRA
248). But this ruling is not inconsistent with the
above pronouncement for in those cases there was
proof that the properties, though registered in the
name of only one spouse, were indeed conjugal
properties, or that they have been acquired during the
marriage of the spouses, and therefore, presumed
conjugal, without the adverse party having presented
proof to rebut the presumption (See Mendoza vs-
Reyes, No. L-31618, August 17, 1983, 124 SCRA
154).
In the instant case, had petitioner, Moises Jocson,
presented sufficient proof to show that the disputed
properties were acquired during his parents'
coverture. We would have ruled that the properties,
though registered in the name of Emilio Jocson alone,
are conjugal properties in view of the presumption
under Article 160. There being no such proof, the
condition sine qua non for the application of the
presumption does not exist. Necessarily, We rule that
the properties under Exhibit 3 are the exclusive
properties of Emilio Jocson.
There being no showing also that the camarin and the
two ricemills, which are the subject of Exhibit 4,
were conjugal properties of the spouses Emilio
Jocson and Alejandra Poblete, they should be
considered, likewise, as the exclusive properties of
Emilio Jocson, the burden of proof being on
petitioner.
ACCORDINGLY, the petition is DISMISSED and
the decision of the Court of Appeals is AFFIRMED.
SO ORDERED.
G.R. No. L-21707 March 18, 1967
FELIPE ACAR, ET AL., petitioners,
vs.
HON. INOCENCIO ROSAL, in his capacity as
Executive Judge, Court of First Instance of
Negros Oriental, 12th Judicial District, respondent.
F. S. Villarin for petitioners.
Jose B. Navarro for respondent.
BENGZON J.P., J.:
All over the world, Constitutions share one purpose:
to protect and enhance the people's interest, as a
nation collectively and as persons individually. The
Philippine Constitution is no exception. Interpretation
of its provisions, therefore, should be done with a
view to realizing this fundamental objective. Among
the provisions in our Constitution is one both, timely
and far-reaching, as it affects the people at large and
relates to social justice problems of the day. It is
Subsec. 21, Sec.I of Art. III: "Free access to the
courts shall not be denied to any person by reason of
poverty." It is the one involved in this case.
A suit was filed in the Court of First Instance of
Negros Oriental on February 21, 1963 by ten persons
for their own behalf and that of 9,000 other farm
laborers working off and on in sugar cane plantations
at the Bais milling district, Negros Oriental, against
Compañia General de Tabacos de Filipinas, Central
Azucarera de Bais, Compañia Celulosa de Filipinas,
Ramon Barata, Aurelio Montinola, Sr., and Miguel
Franco. Plaintiffs sought to recover their alleged
participations or shares amounting to the aggregate
sum of P14,031,836.74, in the sugar, molasses,
bagasse and other derivatives based on the provisions
of Republic Act 809 (The Sugar Act of 1952),
particularly Sections 1 and 9 thereof:
SECTION 1. In the absence of written
milling agreements between the majority of
planters and the millers of sugarcane in any
milling district in the Philippines, the
unrefined sugar produced in that district
from the milling by any sugar central of the
sugar-cane of any sugar-cane planter or
plantation owner, as well as all by-products
and derivatives thereof, shall be divided
between them as follows:
Sixty per centum for the planter, and forty
per centum for the central in any milling
district the maximum actual production of
which is not more than four hundred
thousand piculs: Provided, That the
provisions of this section shall not apply to
sugar centrals with an actual production of
less than one hundred fifty thousand piculs;
Sixty-two and one-half per centum for the
planter, and thirty-seven and one-half per
centum for the central in any milling district
the maximum actual production of which
exceeds four hundred thousand piculs but
does not exceed six hundred thousand
piculs;
Sixty-five per centum for the planter, and
thirty-five per centum for the central in any
milling district the maximum actual
production of which exceeds six hundred
thousand piculs but does not exceed nine
hundred thousand piculs;
Sixty-seven and one-half per centum for the
planter, and thirty-two and one-half per
centum for the central in any milling district
the maximum actual production of which
exceeds nine hundred thousand piculs but
does not exceed one million two hundred
thousand piculs;
Seventy per centum for the planter, and
thirty per centum for the central in any
milling district the maximum actual
production of which exceeds one million
two hundred thousand piculs.1äwphï1.ñët
By actual production is meant the total
production of the mill for the crop year
immediately preceding.
xxx xxx xxx
SEC. 9. In addition to the benefits granted
by the Minimum Wage Law, the proceeds of
any increase in the participation granted the
planters under this Act and above their
present share shall be divided between the
planter and his laborers in the plantation in
the following proportion:
Sixty per centum of the increased
participation for the laborers and forty per
centum for the planters. The distribution of
the share corresponding to the laborers shall
be made under the supervision of the
Department of Labor.
The benefits granted to laborers in sugar
plantations under this Act and in the
Minimum Wage Law shall not in any way
be diminished by such labor contracts
known as "by the piece," "by the volume,"
"by the area," or by any other system of
"pakyaw," the Secretary of Labor being
hereby authorized to issue the necessary
orders for the enforcement of this
provision."
Furthermore, plaintiffs asked thereunder as well as by
separate motion, that the aforementioned court
authorize them to sue as pauper litigants, under Sec.
22, Rule 3 of the Rules of Court:
SEC. 22. Pauper litigant. — Any court may
authorize a litigant to prosecute his action or
defense as a pauper upon a proper showing
that he has no means to that effect by
affidavits, certificate of the corresponding
provincial, city or municipal treasurer, or
otherwise. Such authority once given shall
include an exemption from payment of legal
fees and from filing appeal bond, printed
record and printed brief. The legal fees shall
be a lien to any judgment rendered in the
case favorably to the pauper, unless the
court otherwise provides.
invoking Sec. 1, subsec. (21) of Art. III of
the Constitution of the Philippines. They
alleged that they had no means, to pay the
docket fee of P14,500.00, being laborers
dependent solely on their daily wages for
livehood and possessed of no properties.
And in support of the foregoing, the ten
named plaintiffs submitted certificates of the
municipal treasurers of their places of
residence stating that they have no real
property declared in their names in said
municipalities.
Acting on the petition to litigate in forma pauperis,
the Court of First Instance issued an order on May
27, 1963, denying the same upon the ground that the
plaintiffs have regular employment and sources of
income and, thus, can not be classified as poor or
paupers.
Plaintiffs sought reconsideration of said order but
reconsideration was denied in an order dated June 11,
1963. Assailing said two CFI orders and asserting
their alleged right not to be denied free access to the
courts by reason of poverty, plaintiffs in said case
filed herein, on August 1, 1963, the present special
civil action orcertiorari and mandamus. Petition to
litigate as pauper in the instant case before Us was
also filed. And on August 16, 1963, We allowed
petitioners herein to litigate in this Court as paupers
and required respondent to answer. Respondent's
answer was filed on November 2, 1963. After hearing
on February 10, 1964 this case was submitted for
decision.
The sole issue herein is whether petitioners were
deprived, by the orders in question, of free access to
the courts by reason of poverty. In denying
petitioners' motion to litigate as paupers, respondent
Judge adopted the definition at "pauper" in Black's
Law Dictionary (at p. 1284) as "a person so poor that
he must be supported at public expense". And, as
afore-stated, he ruled that petitioners are
not that poor.
Such interpretation, to our mind, does not fit with the
purpose of the rules on suits in forma pauperis and
the provision of the Constitution, in the Bill of
Rights, that: "Free access to the courts shall not be
denied to any person by reason of poverty." As
applied to statutes or provisions on the right to sue in
forma pauperis, the term has a broader meaning. It
has thus been recognized that: "An applicant for
leave to sue in forma pauperis need not be a pauper;
the fact that he is able-bodied and may earn the
necessary money is no answer to his statement that he
has not sufficient means to prosecute the action or to
secure the costs" (14 Am. Jur. 31). It suffices that
plaintiff is indigent (Ibid.), the not a public charge.
And the difference between "paupers" and "indigent"
persons is that the latter are "persons who have no
property or source of income sufficient for their
support aside from their own labor, though self-
supporting when able to work and in employment"
(Black's Law Dictionary, p. 913, "Indigent", citing
People vs. Schoharie County, 121 NY 345, 24 NE
830). It is therefore in this sense of being indigent
that "pauper" is taken when referring to suits in forma
pauperis. Black's Law Dictionary in fact defines
pauper, thus: "A person so poor that he must be
supported at public expense; also a suitor who, on
account of poverty, is allowed to sue or defend
without being chargeable with costs" (p. 1284,
emphasis supplied).
It is further argued that the docket fee of P14,500
would very well be shouldered by petitioners since
there are around 9,000 of them. It must be
remembered, however that the action in question was
filed by way of a class suit. And the Rules of Court
allowing such procedure state under Sec. 12, Rule 3:
SEC. 12. Class suit. — When the subject
matter of the controversy is one of common
or general interest to many persons, and the
parties are so numerous that it is
impracticable to bring them all before the
court, one or more may sue or defend for the
benefit of all. But in such case the court
shall make sure that the parties actually
before it are sufficiently numerous and
representative so that all interest concerned
are fully protected. Any party in interest
shall have a right to intervene in protection
of his individual interest.
So that in the suit before respondent Judge the ten
named petitioners herein are the ones suing, albeit for
the benefit of all the others. It follows that the
payment of docket fee would be directly charged
upon them, not upon the unnamed "9,000 other
laborers." And even if the 9,000 other laborers should
later bear the payment of said docket fee of P14,500,
the same would be spread among them at about P1.60
each. Said cost of pressing their respective average
demand of P1.60 each is, to Our mind, a substantial
imposition on a seasonal farm laborer earning barely
subsistent wages. And as pointed out, this is only the
initial fee; subsequent fees and charges would have to
be paid. The philosophy underlying the constitutional
mandate of free access to the courts notwithstanding
poverty, therefore, calls for exemption of herein
petitioners from payment of the aforesaid legal fees
in their assertion and claim of substantial rights under
the Sugar Act of 1952.
Returning to the purpose of all Constitutions, as
mentioned earlier, We find this course the most
sensible, logical and practical construction demanded
by the free access clause of the Constitution. For a
contrary interpretation could not make said provision
the living reality that it is designed to be.
As regards the fact that the supporting certifications
of indigence refer only to the ten named plaintiffs,
suffice it to reiterate that this involves a class suit,
where it is not practicable to bring all the other 9,000
laborers before the court. This Court finds the
supporting evidence of indigence adequate, showing
in petitioners' favor, as plaintiffs in the suit before
respondent Judge, the right not to be denied free
access to the courts by reason of poverty. Since they
were excluded from the use and enjoyment of said
right, mandamus lies to enforce it. Appeal was
unavailing, since they were not even accorded the
status of litigants, for non-payment of docket fee; and
perfecting an appeal would have presented the same
question of exemption from legal fees, appeal bond
and similar requisites.
Wherefore, petitioners are declared entitled to litigate
as paupers in their class suit before respondent Judge
and the latter is hereby ordered to grant their petition
to litigate in forma pauperis. No costs. So ordered.
G.R. No. L-49247 March 13, 1979
REPUBLIC OF THE PHILIPPINES, Petitioner,
vs. HON. WENCESLAO M. POLO, Presiding
Judge, Court of First Instance of Samar, Branch
V (Calbayog City); BASILIO ROSALES,
TRINIDAD D. ENRIQUEZ, JOSE RONO,
CESAR DEAN, MARIA S. QUESADA, AURORA
SOLIMAN, JAIME ROCO and
HERMINIGILDO ROSALES,Respondents.
Office of the Solicitor General for
petitioner.chanrobles virtual law library
Noblejas, Sorreta & Associates for respondents.
AQUINO, J.:
This case is about the timeliness of the Governments
appeal in a land registration case. The Court of First
Instance of Samar in a decision dated May 10, 1978
in LRC Case No. N-86-CC granted the application of
Basilio Resales, Herminigildo Resales, Trinidad D.
Enriquez, Jose Rollo, Maria S. Quesada, Cesar Dean,
Aurora Soliman and Jaime Roco for the registration
of thirteen lots (including a small island), with a total
area of about seven hectares, located at Barangay
Malahug, Tinambacan, Calbayog City. chanrobles
virtual law library
A copy of that decision was received in the Solicitor
General's Office on May 25, 1978. On June 23, 1978
or twenty-nine days after service of the said decision,
the Solicitor General filed a motion for
reconsideration. A copy of the order denying that
motion was received in the Solicitor General's Office
on August 18, 1978. On that same date, he filed a
notice of appeal and a motion for an extension of
thirty days from August 19 (last day of the thirty-day
reglementary period) within which to file the record
on appeal. The motion for extension was not acted
upon. chanrobles virtual law library
The record on appeal was filed on September 15,
1978 or within the period sought in the motion Or
extension. The lower court disapproved the record on
appeal and did not give due course to the
Government's appeal because the record on appeal
was allegedly filed out of time. The lower court
reasoned out that the thirty-day period should be
computed, not from May 25, 1978, when the Solicitor
General was served with a copy of the decision, but
from May 11, 1978, when the city fiscal of Calbayog
City, who represented the Solicitor General at the
hearings, was served with that decision. chanrobles
virtual law library
Disagreeing with that order, the Solicitor General in
behalf of the Republic of the Philippines, filed this
petition for review to compel the lower court to give
due course to the appeal The case may be treated as a
mandamus action to require the trial court to allow
the Government's appeal (Sec. 15, Rule 41, Rules of
Court). chanrobles virtual law library
The issue is whether the thirty-day period should be
reckoned from the service of the decision upon the
fiscal or from the time it was served upon the
Solicitor General chanrobles virtual law library
We hold that the thirty-day period should be counted
from the date when the Solicitor General received a
copy of the decision because the service of the
decision upon the city fiscal did not operate as a
service upon the Solicitor General. chanrobles virtual
law library
It should be clarified that, although the Solicitor
General requested the city fiscal to represent him in
the trial court, he, nevertheless, made his own
separate appearance as counsel for the State. In that
"notice of appearance", he expressly requested that he
should be served in Manila with "all notices of
hearings, orders, resolutions, decisions and other
processes" and that such service is distinct from the
service of notices and other papers on the city
fiscal. chanrobles virtual law library
The Solicitor General also indicated in his "notice of
appearance" that he "retains supervision and control
of the representation in this case and has to approve
withdrawal of the case, non-appeal or other actions
which appear to compromise the interests of the
Government" and that "only notices of orders,
resolutions and decisions served on him will bind"
the Government. chanrobles virtual law library
The Solicitor General in requesting the city fiscal to
represent him at the hearings called the attention of
that official to Circular No. 41 of the Secretary of
Justice dated November 28, 1973- wherein provincial
and city fiscals were advised that, in cases where they
represent the Solicitor General "service on the
Solicitor General shall' be the basis" "for the purpose
of finality of the decision " chanrobles virtual law
library
In this case, it is obvious that, strictly speaking, the
city fiscal did not directly represent the Government.
He was merely a surrogate of the Solicitor General
whose office, "as the law office of the Government of
the Republic of the Philippines", is the entity that is
empowered to "represent the Government in all land
registration and related proceedings" (Sec. i[e],
Presidential Decree No. 478). chanrobles virtual law
library
The trial court in disallowing the Government's
appeal relied on the ruling that the service of the
decision in a land registration case on the fiscal is
necessarily a service on the Solicitor General
(Republic vs. Reyes, L-35545, June 18, 1976, 71
SCRA 426, 436-437).chanrobles virtual law library
That ruling is not applicable to this case because in
the Reyes case the fiscal as representative of the
Solicitor General, was authorized not only to attend
hearings but also to file pleadings for the
Government. In the instant case, the city fiscal's
authority was confined to attending the hearings. The
Office of the Solicitor General was the one that filed
the pleadings and motions in the lower
court. chanrobles virtual law library
The Solicitor General in his petition herein observed
that it was the ruling in the Reyes case that prompted
his office "to revise completely the letter of authority
to file representing" him by making it clear that it is
the service of the decision on the Solicitor General
that would bind the Government. chanrobles virtual
law library
The respondents contend that the petition for review
is unwarranted because the Solicitor General stated in
his notice of appeal that he was appealing to the
Court of Appeals. They argue that the petition is not a
special civil action of certiorari since no jurisdictional
errors were committed by the trial court and,
therefore, this Court should not entertain the
petition. chanrobles virtual law library
As already stated, the petition should be regarded as
an action for mandamus. That petition could have
been filed in the Court of Appeals in aid of its
appellate jurisdiction (Sec. 30, judiciary Law). But it
was also properly filed in this Court which has
concurrent jurisdiction with the Court of Appeals to
issue the writ of mandamus. (Breslin vs. Luzon
Stevedoring Co., 84 Phil. 618, 625; Salva vs. Palacio,
90 Phil 731, 734). chanrobles virtual law library
The private respondents further contend that the
Solicitor General's motion for reconsideration, which
was filed on June 23, 1978 or on the twenty-ninth
day, did not interrupt the period for appeal because
they were personally served with a copy of the
motion on June 27, 1978 or three days after the
expiration of the period. They invoke the ruling that a
motion for reconsideration, which was not served
upon the adverse party, could not be entertained and
did not interrupt the period for appeal (Cabatit vs.
Court of Agrarian Relations, 120 Phil. 56; National
Development Company vs. CIR and National Textile
Workers Union, 116 Phil. 1085). chanrobles virtual
law library
The instant case is not a case where there was no
service at all of the motion for reconsideration. It is a
case where the service of the motion was late. But the
tardiness is more apparent than real because if the
Solicitor General's office, on June 23, 1978, had
opted to send a copy of that motion to the private
respondents by registered mail, that copy would have
reached them most likely after June 27, 1978, when
they were personallyserved with a copy thereof (See
ruling that in the interest of justice, this Court may
except a particular case from the operation of its own
rules. U.S., vs. Breitling, 15 L. ed. 900, 902; C.
Viuda de Ordoveza vs. Raymundo, 63 Phil. 275, 278;
Republic vs. Court of Appeals, L-31303-04, May 31,
1978). chanrobles virtual law library
WHEREFORE, we hold that the appeal was
perfected seasonably. The trial court's order
disallowing petitioner's appeal is reversed and set
aside. It is directed to pass upon the record on appeal
and, if found to be sufficient, to give due course to
petitioner's appeal No costs. chanrobles virtual law
library
SO ORDERED.
G.R. No. L-61997 November 15, 1982
REPUBLIC OF THE PHILIPPINES &
TRADERS ROYAL BANK, petitioners,
vs.
ELFREN PARTISALA and HON. MIDPANTAO
L. ADIL, in his capacity as Presiding Judge of the
2nd Branch of the Court of First Instance of
Iloilo, respondents.
Solicitor General for petitioner.
Antonio C. Singson for petitioner Traders Royal
Bank.
Enrique Arguelles and Eugenio Original for
respondents.
ABAD SANTOS, J.:
This is a special civil action for certiorari. Off-hand it
can be said that the petition is frivolous. It was also
filed in the wrong court -- the Court of Appeals. True
the Court of Appeals has ,'original jurisdiction to
issue writs of mandamus, prohibition, injunction,
certiorari, habeas corpus, and all other auxiliary writs
and process in aid of its appellate jurisdiction" (Sec.
30, Judiciary Act, as amended) but true also is that
the Supreme Court has exclusivejurisdiction on final
judgments and decrees of inferior courts in "cases in
which only errors or questions of law are involved."
(Sec. 17, Id em.) This is such a case so that the Court
of Appeals had to certify it to Us.
In Criminal Case No. 10997 of the Court of First
Instance of Iloilo, Elfren Partisala was accused of
estafa upon complaint of his employer The Traders
Royal Bank. He pleaded guilty and was forthwith
"sentenced To suffer an indeterminate imprisonment
of from Four (4) Years, Two (2) Months and One (1)
Day, minimum, to Six (6) Years of prision
correccional, maximum, together with all the
accessory penalties provided for t)y law and to pay
the costs." He was also ordered to reimburse to the
bank the amount malversed. immediately after he
was sentenced, Partisala filed an application for
probation. Three weeks later, an assistant provincial
fiscal and tile private prosecutor opposed the
application for probation. They argued that Partisala
can best be rehabilitated in prison and if he is set free
he might commit other crimes, There followed a
reply to the opposition; a supplement to the
opposition; a memorandum to support the
application; a rejoinder to the reply. So far, so good.
But before the trial judge could act on the application
which appears to have attracted attention because the
Sangguniang Bayan of Calinog, Iloilo, in special
session passed a resolution wherein it "RESOLVED
to manifest, as this Body do hereby manifest, the
alarm and vehement sentiment of the people of this
Municipality over reprehensive conduct of Elfren
Partisala for his abstraction and misappropriation of
the peoples' savings and deposits and other funds of
the Calinog Branch of the Traders Royal Bank," the
Acting Provincial Fiscal no less intervened. He
sought to educate the trial judge by filing a
"MOTION TO CORRECT ERROR IN
COMPUTATION OF PENALTY AND TO HOLD
IN ABEYANCE PETITION FOR PROBATION."
He advanced the proposition that Partisala should
have been sentenced to a penalty higher than six
years which would then make him ineligible for
probation. (Sec. 9, par. a, Probation Law, as
amended.) But even the learned fiscal was not
absolutely certain as to the correct penalty. Firstly, he
said the penalty "is between 6 years, 8 months, 21
days to 8 years." But alternatively he said that the
imposable penalty can also "be in the medium period
of prision mayor, which has a range of from 8 years, I
day and 1 0 years." He asked that the sentenced
imposed on Partisala be "corrected. "
Predictably, the trial judge denied the motion. He
gave two reasons for the denial, namely:
1. The motion is in the nature of a
motion for reconsideration. As such
it should have been filed before the
sentence of the accused became
final. It is elementary that a motion
for reconsideration should be based
on the same grounds as those for a
new trial for the two remedies are
the same. Under Rule 121, Section
1, a motion for new trial should be
filed before the finality of a
conviction.
Under P.D. No. 968, the Probation
Law, a convict who files a petition
for probation automatically waives
his right to appeal and therefore his
conviction becomes final.
Therefore, the instant motion is
filed out of time.
2. The motion, if granted will place
the accused in double jeopardy.
(People vs. Taruc, G.R. No.L-8229,
Nov. 28, 1955; People vs. Ang Cho
Kio, L-6697-6688).
A motion for reconsideration was filed but denied. In
the meantime, the trial judge granted Partisala's
application for probation.
The instant petition prays that the orders of the trial
judge denying the motion to correct, denying the
motion to reconsider the denial, and granting the
application for probation be annulled; that the correct
penalty be imposed on Partisala; and that his
application for probation be denied.
We do not have to decide whether or not the penalty
which the trial judge imposed on Partisala is correct.
For correct or not, it is a valid sentence because the
trial judge had jurisdiction to impose it. So for the
reasons given by him when he denied the motion to
correct, the sentence was already beyond his reach,
including this Court.
It is to be noted the Republic of the Philippines is one
of the petitioners herein. The one who signed the
petition for the Republic is a mere second assistant
provincial fiscal, albeit he is the Officer-in-Charge of
the Iloilo Provincial Fiscal's Office. We make it
known that only the Solicitor General can bring or
defend actions on behalf of the Republic of the
Philippines. Henceforth actions filed in the name of
the Republic of the Philippines if not initiated by the
Solicitor General will be summarily dismissed.
WHEREFORE, the petition is dismissed for lack of
merit. The preliminary injunction which was issued
by the Court of Appeals is hereby dissolved. No
costs.
SO ORDERED.