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#113 KKK Foundation Inv. v Hon. Bargas, et.

al o (1) where a rigid application will result in a manifest failure or miscarriage of justice
GR NO. 163785 especially if a party successfully shows that the alleged defect in the questioned final
December 27, 2007 and executory judgment is not apparent on its face or from the recitals contained
Topic: Motions therein;
Petitioners: KKK Foundation, Inc. o (2) where the interest of substantial justice will be served;
Respondents: Hon. Adelina Calderon-Bargas o (3) where the resolution of the motion is addressed solely to the sound and judicious
Ponente: Quisumbing, J discretion of the court; and
o (4) where the injustice to the adverse party is not commensurate with the degree of
his thoughtlessness in not complying with the procedure prescribed.
FACTS:
• A notice of hearing is an integral component of procedural due process to afford the adverse
• Petitioner KKK Foundation, Inc. filed a complaint for Annulment of Extra-judicial Foreclosure of
parties a chance to be heard before a motion is resolved by the court. Through such notice, the
Real Estate Mortgage and/or Nullification of Sheriffs Auction Sale and Damages with Prayer for
adverse party is given time to study and answer the arguments in the motion
the Issuance of Temporary Restraining Order and/or Writ of Preliminary Injunction
• Records show that while Angeles’ Motion for Issuance of Writ of Execution contained a notice
• Petitioner alleged that
of hearing, it did not particularly state the date and time of the hearing.
o (1) the auction sale was made with fraud and/or bad faith since there was no public
• However, we still find that petitioner was not denied procedural due process. Upon receiving
bidding;
the Motion for Issuance of Writ of Execution, the trial court issued an Order dated September
o (2) the sheriff did not post the requisite Notice of Sheriffs Sale;
9, 2002 giving petitioner ten (10) days to file its comment. The trial court ruled on the motion
o (3) the petition for extrajudicial foreclosure was fatally defective since it sought to
only after the reglementary period to file comment lapsed. Clearly, petitioner was given time
foreclose properties of two different entities;
to study and comment on the motion for which reason, the very purpose of a notice of hearing
o (4) the foreclosed properties were awarded and sold to Imelda A. Angeles for an
had been achieved
inadequate bid of only P4,181,450; and
• The notice requirement is not a ritual to be followed blindly. Procedural due process is not
o (5) the auction sale involved eight parcels of land covered by individual titles but the
based solely on a mechanical and literal application that renders any deviation inexorably fatal.
same were sold en masse
Instead, procedural rules are liberally construed to promote their objective and to assist in
• Judge Adelina Calderon-Bargas issued a temporary restraining order preventing Angeles from
obtaining a just, speedy and inexpensive determination of any action and proceeding
consolidating her ownership to the foreclosed properties
• Petitioner and Angeles executed a Compromise Agreement wherein petitioner agreed to pay
DISPOSITION:
Angeles the bid price of the eight parcels of land within 20 days. The parties then filed a Motion
to Approve Compromise Agreement
WHEREFORE, the instant petition is PARTIALLY GRANTED. The Decision dated November 28, 2003 and the
• On April 1, 2002, petitioner filed an Urgent Ex-Parte Motion to Recall Compromise Agreement
Resolution dated May 26, 2004 of the Court of Appeals in CA-G.R. SP No. 73965 are MODIFIED such that
since the other property owner and other trustees of petitioner were not consulted prior to the
the writ of execution issued on October 11, 2002 by Judge Adelina Calderon-Bargas is declared NULL and
signing of the agreement. Angeles opposed the motion
VOID.
• Judge Bargas issued an order stating that Urgent Ex-Parte Motion to Recall Compromise
Let this case be REMANDED to the Regional Trial Court of Morong, Rizal, Branch 78, which is hereby
Agreement and Motion to Approve Compromise Agreement failed to comply with Sec[s]. 4 and ORDERED to issue another writ of execution against petitioner KKK Foundation, Inc., in conformity with
5, Rule 15 of the Civil Procedure for having no specific date of hearing.
the Decision dated June 28, 2002 of the trial court. This is without prejudice to filing a new motion for
• The Compromise agreement was approved by TC on June 28, 2002 consolidation by respondent Angeles.
• Angeles then moved for the issuance of a writ of execution. On September 9, 2002, the trial
court required petitioner to comment on the motion within ten (10) days
• On October 3, 2002, the trial court directed the Clerk of Court to issue a writ of execution. On
the same date, the trial court received petitioners Motion for Extension of Time to File
Comment with Entry of Appearance which was denied on October 10, 2002.
• Petitioner with certiorari appealed to CA, stating that Hon Bargas commited grave abuse of
discretion amounting to lack or excess of jurisdiction by granting Motion for Issuance of Writ of
Execution although it lacked the requisite notice of hearing. CA denied the appeal
ISSUE(s):
W/N the trial court erred in granting the Motion for Issuance of Writ of Execution although it lacked the
requisite notice of hearing (NO)

HELD:

• Petitioner was not denied due process


• Service of a copy of a motion containing a notice of the time and the place of hearing of that
motion is a mandatory requirement, and the failure of movants to comply with these
requirements renders their motions fatally defective. However, there are exceptions to the
strict application of this rule. These exceptions are:
114. Camarines Corp. v. Aquino
G.R. No. 167691 • RTC denied Aquino’s MR on Feb 3, 2004. However, it was silent on the motion's non- compliance
September 23, 2008 with the 3-day rule.
Topic: Hearing
Petitioners: CAMARINES SUR IV ELECTRIC COOPERATIVE, INC. • Aquino filed an appeal in the CA on February 5, 2004, insisting that the complaint sufficiently stated
Respondents: EXPEDITA L. AQUINO a cause of action for damages. Petitioner reiterated its stand on the issue. It also called the CA's
Ponente: J. Corona attention to the alleged flaw in respondent's motion for reconsideration in the RTC. It argued
that the motion was a pro forma motion (since it violated the 3-day rule) which should have been
Doctrine: Time and again, we have held that non-compliance with Section 4 of Rule 15 of the Rules of dismissed outright by the trial court. Furthermore, it did not stop the running of the 15-day
Court is a fatal defect. A motion which fails to comply with said Rule is a mere scrap of paper. If filed, such period for respondent to appeal which should have been reckoned from her receipt of the second
motion is not entitled to judicial cognizance. The fact that the RTC took cognizance of a defective motion, RTC order on December 23, 2003. Consequently, her February 5, 2004 notice of appeal (which
such as requiring the parties to set it for hearing and denying the same for lack of merit, did not cure the was filed 44 days after she received a copy of the second RTC order) was filed late.
defect of said motion. It did not suspend the running of the period to appeal.
• The CA held that the RTC erred in dismissing the complaint as indeed a cause of action existed.
FACTS: However, it did not pass upon the issue relative to the timeliness of respondent's appeal. Petitioner
filed for MR – denied. Hence this petition.
• Expedita Aquino purchased several computers and leased a building in TIgaon, Camarines Sur, for
gaming business. She had the electrical service in the building restored because the former tenant, ISSUE : (W/N the complaint states a cause of action (YES))
a certain Mrs. Paglinawan, had it disconnected when she gave up the occupancy thereof. Main Issue: W/N Aquino's appeal in the CA was filed on time. (NO)

• Aquino paid the reconnection fee and the electric consumption fee for April 17, 2002 to May 16,
2002 to the Petitioner. However, there were no payments made on succeeding months. HELD/RATIO

• Petitioner inspected the electrical wiring of the building and made a report of pilferage of electricity 1st Issue:
with the notation: "Disconnected w/light/illegal tapping. There is cause of action as Respondent was in possession of the property supplied with electricity by
petitioner when the electric service was disconnected. This resulted in the alleged injury complained of
• Petitioner alleged alleged that respondent violated RA 7832 and required her to pay the differential which can be threshed out in a trial on the merits.
billing and penalty within 48 hours; otherwise, the electric service would be disconnected. A
conciliatory conference between the parties was held where petitioner presented Aquino with two There is a cause of action when the following elements are present: (1) the legal right of the plaintiff; (2)
options: deposit the differential billing of P3,367.00 to avoid disconnection during the pendency of the correlative obligation of the defendant and (3) the act or omission of the defendant in violation of said
the criminal action to be filed by petitioner or pay the amount of the differential billing and the legal right.
penalty of P15,000.00, in which case the matter would be considered closed and the filing of a
criminal case dispensed with. Main Issue:

• Aquino refused to choose between the option as it is tantamount to her guilt. Her electrical service In its petition in this Court, petitioner insisted that Aquino mailed a copy of her motion for
was permanently disconnected. She filed a complaint for damages against petitioner in the Regional reconsideration (with notice of hearing) to its (petitioner's) counsel only on January 5, 2004, although
Trial Court (RTC). She alleged that due to the disconnection of electrical services, her business the motion was already scheduled for hearing on January 9, 2004. Aquino should have foreseen that the
operation was interrupted causing her damages in the form of unrealized income, rentals paid for registered mail, which originated from Naga City, would not be able to reach the law office of petitioner's
the premises she was unable to use and renovation costs of the leased building. counsel in Manila at least 3 days before said date. Thus, respondent's motion for reconsideration was
fatally flawed for failure to comply with the 3-day rule under Section 4, Rule 15 of the Rules of Court. It
• Petitioner filed an answer with affirmative defenses. It alleged, among others, that the complaint did not toll the reglementary period for respondent to appeal the RTC's decision.
failed to state a cause of action. According to petitioner, no contract to supply electricity was entered
into between them. Respondent subsequently amended her complaint. Petitioner still insisted that Section 4, Rule 15 of the Rules of Court provides:
the complaint stated no cause of action.
Sec. 4. Hearing of Motion. — Except for motions which the court may act upon without prejudicing the
rights of the adverse party, every motion shall be set for hearing by the applicant.
• July 10, 2003 - RTC denied the motion to dismiss as it held that Aquino as in possession of the
Every written motion required to be heard and the notice of hearing thereof shall be served in such a
premises to which petitioner supplied electricity, there was, in a way, a contract between the parties.
manner as to ensure its receipt by the other party at least three (3) days before the date of hearing,
unless the court for good cause sets the hearing on shorter notice.
• Petitioner filed for MR, RTC ruled in its favor in an order dated Dec. 22, 2003. Aquino received the
copy the following day and filed an MR on Jan 5, 2004. She mailed a copy of her motion for
Time and again, we have held that non-compliance with Section 4 of Rule 15 of the Rules of Court is a
reconsideration (with notice of hearing) to petitioner's counsel only on the same date. The notice
fatal defect. A motion which fails to comply with said Rule is a mere scrap of paper. If filed, such
of hearing indicated that the hearing of the motion was set on January 9, 2004. Petitioner filed an
motion is not entitled to judicial cognizance. The fact that the RTC took cognizance of a defective
opposition thereto, alleging, among others, that the motion should be denied as respondent did
motion, such as requiring the parties to set it for hearing and denying the same for lack of merit, did
not comply with the 3-day rule (as provided in the Rules of Court).
not cure the defect of said motion. It did not suspend the running of the period to appeal.
115. Romulo V. Peralta The Supreme Court held that Atty. Bacungan only received the April 5,2004 letter on April 20,
G.R. 165665 2004 or 4 days after it was set for hearing. The service of pleading by registered mail provides
January 31, 2007 that such proof of service requires an affidavit of the person mailing the pleading containing
Topic: Motions; Service; Rule 15(6) the full statement of the date, place and manner of service and the registry receipt issued by
Petitioners: Hon. Alberto Romulo, Department of Transportation and Communication & Civil the mailing office.
Aeronautics Board Chairman
Respondents: Hon. Judge Eduardo B. Peralta, PAL Employees, National Labor Union & National Hence, by citing the case of Cayetano V. Cayetano, the actual knowledge of a decision cannot
Federation of Labor Union be attributed to the addressee of a registered matter where there is no showing that the
Ponente: J. Sandoval-Gutierrez registry notice itself contains any indication that the registered matter is a copy of the decision
or that the registry notice refers to the case being ventilated. Unfortunately in this case, Ms.
Bayongan merely directed the motion be served by registered mail but what was required
DOCTRINE: It is upon the one who executed the affidavit to mail such motion and the failure to
for her to do was that she was supposed to be the one to mail it.
do so will make such sending non-existent
Therefore, such mailing of motion was not done properly by the person who was indicated in
FACTS
the affidavit and that by doing so, the petitioner herewith failed to follow the proper procedure
- President GMA executed E.O. 253 which provides for an open skies policy in the
in doing so which resulted in the proper dismissal of the RTC.
aviation industry
- As a result, the Diosdado Macapagal International Airport and the Subic Bay
DISPOSITIVE PORTION
International Airport were opened to international air cargo transportation
WHEREFORE, we DISMISS the petition and AFFIRM the assailed Orders of the Regional Trial
providers and foreign airlines
Court, Branch 17, Manila in Civil Case No. 04-109201. No costs.
- PAL Employees Assosciation (PALEA), National Labor Union (NLU) and the National
Federation of Labor Unions (NAFLU) filed before the RTC of Manila a petition for
certiorari, prohibition and injunction assailing the constitutionality of E.O. 253
- Such argument alleged that E.O. 253 breached the power of the congress since such
declaration can only be done by the congress only and not the executive
- OSG filed a motion to dismiss for lack of cause of action
- April 6, 2004, the OSG served a copy of such motion by registered mail upon Atty.
Bacungan who is the counsel for the respondents
- RTC denied such motion based on the absence of proof of transmittal by registered
mail of a copy of the motion to dismiss
- OSG then filed a motion for reconsideration and attached a photocopy of registry
return but the same motion was denied by the RTC
- OSG filed another motion for reconsideration and attached a certified photocopy of
the OSG’s original registry, certified photocopy of page 374 of the Offical Records
Book of the OSG Docket Division and affidavit of Josephine S. Masangkay-Bayongan
who was the Records Officer III of the OSG Docket Division which stated that the
mail was sent to Atty. Bacungan on April 6,2004 but was in fact a copy of the
motion to dismiss dated on April 5,2004
- RTC still denied the second motion for reconsideration due to its judicial admission
- Hence, this petition before the Supreme Court by the petitioner alleging that the RTC
committed a grave abuse of discretion in deciding upon such matters

ISSUE
Whether the petitioners herewith correctly sent the mail

HELD
No!

RATIO
116. Sarmiento v. Zaratan, • Petitioner moved for reconsideration of the said Order, while respondent sought
G.R. 167471, clarification on whether the 31 July 2003 Order dismissing the appeal was anchored
05 February 2007 on Section (b), Rule 40 or Section 7(c) of the same Rule.
TOPIC: Motions
Petitioners: Gliceria Sarmiento • On 27 August 2003, the RTC reconsidered its previous Order by granting petitioners
Respondent: Emerita Zaratan motion for Immediate Execution, but denied respondents Motion for Clarification
Ponente: Chico-Nazario, J.
• respondent filed a Petition for Certiorari in the Court of Appeals, which was granted
FACTS: in a decision dated 17 August 2004.

• On 2 September 2002, petitioner Gliceria Sarmiento filed an ejectment case against • The appellate court nullified and set aside the 19 June 2003 and 31 July
respondent Emerita Zaratan, in the Metropolitan Trial Court (MeTC) of Quezon City 2003 Orders of the RTC and ordered the reinstatement of respondents
• Respondent filed her notice of appeal appeal. Consequently, respondents appeal memorandum was admitted and the
• In the Notice of Appealed Case, the RTC directed respondent to submit her case remanded to the RTC for further proceedings.
memorandum in accordance with the provisions of Section 7(b) of Rule 40 of the
Rules of Court and petitioner to file a reply memorandum within 15 days from • Petitioner filed a motion for reconsideration on 13 September 2004, followed by a
receipt. Motion for Inhibition
• Respondents counsel having received the notice on 19 May 2003, he had until 3
June 2003 within which to file the requisite memorandum. But on 3 June 2003, he ISSUE: Whether the trial court committed grave abuse of discretion in denying respondents
filed a Motion for Extension of Time of five days due to his failure to finish the draft motion for extension
of the said Memorandum. He cited as reasons for the delay of filing his illness for
one week, lack of staff to do the work due to storm and flood compounded by the RULING: YES
grounding of the computers because the wirings got wet. But the motion remained
unacted. • It is not disputed that respondent perfected her appeal on 4 April 2003 with the filing
• On 9 June 2003, respondent filed her Memorandum. On 19 June 2003, the RTC of her Notice of Appeal and payment of the required docket fees. However, before
dismissed the appeal as follows: the expiration of time to file the Memorandum, she filed a Motion for Extension of
• Record shows that defendant-appellant received the Notice of Appealed Case, Time seeking an additional period of five days within which to file her Memorandum,
through counsel, on May 19, 2003 (Registry Return Receipt dated May 12, 2003, which motion lacked the Notice of Hearing required by Section 4, Rule 15 of the 1997
Record, back of p. 298). Thus, under Section 7(b), Rule 40 of the 1997 Rules of Civil Rules of Court which provides:
Procedure, she had fifteen (15) days or until June 3, 2003 within which to submit a
memorandum on appeal. As further appears on record, however, the required SEC. 4. Hearing of Motion. - Except for motions which the court may act
Memorandum was filed by defendant-appellant only on June 9, 2003 (Record, p. upon without prejudicing the rights of the adverse party, every written
623), or six (6) days beyond the expiration of the aforesaid fifteen day period. motion shall be set for hearing by the applicant.
• It should be stressed that while the rules should be liberally construed, the
provisions on reglemenatry periods are strictly applied as they are deemed Every written motion required to be heard and the notice of the hearing
indispensable to the prevention of needless delays and necessary to the orderly thereof shall be served in such a manner as to ensure its receipt by the
and speedy discharge of judicial business (Legaspi-Santos vs. Court of Appeals, G.R. other party at least three (3) days before the date of hearing, unless the
No. 60577, October 11, 1983) and strict compliance therewith is mandatory and court for good cause sets the hearing on shorter notice.
imperative (FJR Garments Industries vs. Court of Appeals, G.R. No. L-49329, June
29, 1984). The same is true with respect to the rules on the manner and periods for • As may be gleaned above and as held time and again, the notice
perfecting appeals (Gutierrez vs. Court of Appeals, L-25972, November 26, 1968). requirement in a motion is mandatory. As a rule, a motion without a Notice
• MTC DISMISSED the case. This renders academic defendant-appellants application of Hearing is considered pro forma and does not affect the reglementary
for a writ of preliminary injunction. period for the appeal or the filing of the requisite pleading.
• On the basis of the above-quoted Order, petitioner filed a Motion for Immediate
Execution while respondent moved for the Reconsideration. Both motions were • As a general rule, notice of motion is required where a party has a right to resist the
denied by the RTC on 31 July 2003. relief sought by the motion and principles of natural justice demand that his right be
not affected without an opportunity to be heard. The three-day notice required by
law is intended not for the benefit of the movant but to avoid surprises upon the
adverse party and to give the latter time to study and meet the arguments of the
motion. Principles of natural justice demand that the right of a party should not be • Dismissal of appeals purely on technical grounds is frowned upon, and the rules of
affected without giving it an opportunity to be heard procedure ought not to be applied in a very rigid, technical sense, for they are
• The test is the presence of the opportunity to be heard, as well as to have time to adopted to help secure, not override, substantial justice, and thereby defeat their
study the motion and meaningfully oppose or controvert the grounds upon which it very aims. As has been the constant rulings of this Court, every party-litigant should
is based. Considering the circumstances of the present case, we believe that be afforded the amplest opportunity for the proper and just disposition of his cause,
procedural due process was substantially complied with. free from constraints of technicalities. Indeed, rules of procedure are mere tools
• There are, indeed, reasons which would warrant the suspension of the Rules: (a) the designed to expedite the resolution of cases and other matters pending in court. A
existence of special or compelling circumstances, b) the merits of the case, (c) a cause strict and rigid application of the rules that would result in technicalities that tend to
not entirely attributable to the fault or negligence of the party favored by the frustrate rather than promote justice must be avoided
suspension of rules, (d) a lack of any showing that the review sought is merely
frivolous and dilatory, and (e) the other party will not be unjustly prejudiced thereby.
Elements or circumstances (c), (d) and (e) exist in the present case.

• The suspension of the Rules is warranted in this case. The motion in question does
not affect the substantive rights of petitioner as it merely seeks to extend the period
to file Memorandum. The required extension was due to respondents counsels
illness, lack of staff to do the work due to storm and flood, compounded by the
grounding of the computers. There is no claim likewise that said motion was
interposed to delay the appeal. As it appears, respondent sought extension prior to
the expiration of the time to do so and the memorandum was subsequently filed
within the requested extended period. Under the circumstances, substantial justice
requires that we go into the merits of the case to resolve the issue of who is entitled
to the possession of the land in question.

• Further, it has been held that a motion for extension of time x x x is not a litigated
motion where notice to the adverse party is necessary to afford the latter an
opportunity to resist the application, but an ex parte motion made to the court in
behalf of one or the other of the parties to the action,
in the absence and usually without the knowledge of the other party or parties. As a
general rule, notice of motion is required where a party has a right to resist the relief
sought by the motion and principles of natural justice demand that his rights be not
affected without an opportunity to be heard. It has been said that ex parte motions
are frequently permissible in procedural matters, and also in situations and under
circumstances of emergency; and an exception to a rule requiring notice is
sometimes made where notice or the resulting delay might tend to defeat the
objective of the motion

• It is well to remember that this Court, in not a few cases, has consistently held that
cases shall be determined on the merits, after full opportunity to all parties for
ventilation of their causes and defense, rather than on technicality or some
procedural imperfections. In so doing, the ends of justice would be better served.

• Furthermore, this Court emphasized its policy that technical rules should accede to
the demands of substantial justice because there is no vested right in technicalities.

• Litigations, should, as much as possible, be decided on their merits and not on


technicality.
#117 REPUBLIC v GLASGOW • In this case, the Rule of Procedure in Cases of Civil Procedure applies to the Republic’s
GR NO. 170281 complaint. Under Section 3 Title II, the venue of civil forfeiture cases is any RTC of the judicial
January 18, 2008 region where the monetary instrument, property or proceeds representing, involving, or
Topic: Motion to Dismiss relating to an unlawful activity or to a money laundering offense are located.
Petitioners: Republic of the Philippines (Represented by the Anti-Money Laundering Council) • Pasig City, where the account sought to be forfeited is situated, is within the National Capital
Respondents: Glasgow Credit and Collection Services, Inc. And Citystate Savings Bank, Inc. Judicial Region. (NCJR) Clearly, the complaint for civil forfeiture of the account may be filed in
Ponente: Corona, J. any RTC of the NCJR. Since RTC Manila is one of the RTCs of the NCJR, it was a proper venue of
Republic’s complaint.
FACTS:
On the ground of Insufficiency in Form and Substance:
• Glasgow has funds in the amount of P21Million deposited with CSBI. As events have proved,
• The complaint was sufficient in form and substance.
the bank account is related to unlawful activities of Estafa and violation of Securities
Regulation Code • In a motion to dismiss for failure to state a cause of action, the focus is on the sufficiency, not
the veracity of the material allegations. The test of sufficiency of the facts alleged is whether
• The Anti-Money Laundering Council (AMLC) issued resolutions directing the issuance of freeze
or not the court could render a valid judgment upon the same in accordance with the prayer
orders against the bank accounts of Glasgow
of the complaint.
• Pursuant to the resolutions, the Freeze Orders were issued on different dates
• Under Section 4 Title II, petition for civil forfeiture shall be verified and contain the name and
address of respondent, description with reasonable particularity of the monetary instrument,
PROCEDURE:
acts or omissions prohibited by the Anti-Money Laundering Act, and the reliefs prayed for.
• Republic, represented by AMLC, filed a complaint in the RTC Manila for civil forfeiture of
o In this case, the form and substance of Republic’s complaint substantially
assets (with urgent plea for issuance of TRO and writ of preliminary injunction) against the
conformed with the requirements stated above
bank deposits maintained by Glasgow in CSBI
o Whether or not there is truth in the allegation, is an evidentiary matter that may
• RTC issued an order granting the issuance of a writ of preliminary injunction. Meanwhile,
be proven during trial
summons to Glasgow was returned “unserved” as it could no longer be found at its last
• Moreover, a criminal conviction for unlawful activity is not a precondition for the institution
known address
of a civil forfeiture proceeding. Regardless of the absence, pendency or outcome of a criminal
• Republic filed a verified omnibus motion for issuance of alias summons and leave of court to
prosecution for the unlawful activity or for the money laundering, an action for civil forfeiture
serve summons by publication
may be separately and independently prosecuted and resolved.
• RTC directed the issuance of alias summons however did not resolve the motion for leave of
court to serve summons by publication
On the ground of Failure to Prosecute:
• Glasgow filed a Motion to Dismiss (By Way of Special Appearance) alleging that:
• There was no failure to prosecute.
o The court had no jurisdiction over its person as summons had not yet been served
• While there was a delay in the proceeding, it could not be entirely ascribed to the Republic.
o The complaint was premature and stated no cause of action as there was still no
That Glasgow’s whereabouts could not be ascertained was beyond Republic’s control, it was
conviction for estafa or other criminal violations
also attributable to Glasgow’s failure to inform SEC or any official body of its new address
o There was failure to prosecute on the part of Republic
• Republic continued to exert efforts to obtain information from government agencies on the
• Republic opposed Glasgow’s Motion to Dismiss contending that:
whereabouts of Glasgow. It filed verified omnibus motion for issuance of alias summons and
o The suit was an action quasi in rem where jurisdiction over the person of the
leave of court to serve summons by publication. No action, however, was taken by the RTC on
defendant was not a perquisite to confer jurisdiction on the court
Republic’s motion for leave of court to serve summons by publication.
o Prior conviction for unlawful activity was not a precondition to the filing of a civil
• RTC should not have wielded its power to dismiss Republic’s complaint.
forfeiture case and that its complaint alleged ultimate facts sufficient to establish a
cause of action
DISPOSITION:
o It did not fail to prosecute the case
• RULING OF RTC: Dismissed the case on the following grounds:
WHEREFORE, the petition is hereby GRANTED. The October 27, 2005 order of the Regional Trial Court of
1. Improper venue, as it should have been filed in RTC Pasig where CSBI, the
Manila, Branch 47, in Civil Case No. 03-107319 is SET ASIDE. The August 11, 2005 motion to dismiss of
depository bank of the account sought to be forfeited, was located
Glasgow Credit and Collection Services, Inc. is DENIED. And the complaint for forfeiture of the Republic of
2. Insufficiency of the complaint in form and substance
the Philippines, represented by the Anti-Money Laundering Council, is REINSTATED. The case is hereby
3. Failure to prosecute
REMANDED to the Regional Trial Court of Manila, Branch 47 which shall forthwith proceed with the case
pursuant to the provisions of A.M. No. 05-11-04-SC. Pending final determination of the case, the November
ISSUE(s):
23, 2005 temporary restraining order issued by this Court is hereby MAINTAINED.
W/N the complaint for civil forfeiture should be dismissed on the grounds of improper venue,
insufficiency in form and substance and failure to prosecute (NO)
HELD:

On the ground of Improper Venue:


• The RTC Manila was a proper venue.
118.Goodyear Philippines, Inc. vs. Sy • If the PNP has not removed the said vehicle from its alert status as stolen vehicle, then it
GR. 154554 does not make Goodyear not the owner consequently, not guilty of any breach resulting
November 9,2005 from any flaw in the title over the vehicle.
MJB • This is confirmed by the allegation of the 3rd party plaintiff as answering defendant in par.
Topic: Motion to Dismiss 6 of its Answer with Counterclaim and Affirmative Defenses, quoted:
Petitioners: Goodyear Philippines Inc o “6. Defendant specifically denies the allegations contained in paragraph 9 of
Respondents: Anthony Sy and Jose Lee plaintiff’s complaint, the truth of the matter is that defendant helped plaintiff
Ponente: Panganiban, J. in removing the impediments in the registration and transfer of ownership and
FACTS: that defendant had no knowledge of any flaw in the title of Goodyear
Philippines, Inc.”
• The subject case involves a motor vehicle (1984 Isuzu JCR 6-Wheeler) originally
owned by Goodyear Philippines,Inc. which it purchased from Industrial and • Under Rules 16, a motion to dismiss may be made on any of the following grounds: “g.
Transport Equipment, Inc. in 1983. That the pleading asserting claim states no cause of action.”
• It had since been in the service of Goodyear until April 30, 1986 when it was hijacked.
COURT OF APPEALS:
• This hijacking was reported to the PNP which issued out an alert alarm on the said
vehicle as a stolen one. It was later recovered in 1986. • The CA granted the appeal and reasoned that the third-party complaint had stated a cause
of action for two reasons.
• The vehicle was used by Goodyear until 1996,
o First, petitioner did not make good its warranty in the Deed of Sale: to convey
o When it sold it to Anthony Sy on Sept. 12, 1996. Sy, in turn,
the vehicle to Respondent Anthony Sy free from all liens, encumbrances and
o Sold it to Jose L. Lee on January 29, 1997 but the latter (Lee) filed an action
legal impediments. The reported hijacking was a legal impediment that
for rescission of contract with damages against Sy because he could not
prevented its subsequent sale.
register the vehicle in his name due to the certificate on from the PNP
o Second, respondent Sy had a right to protect and a warranty to enforce, while
Regional Traffic Management Office in Legazpi City that it was a stolen
petitioner had the corresponding obligation to honor that warranty.
vehicle and the alarm covering the same was not lifted. PNP in Legazpi City,
instead impounded the vehicle and charged Lee criminally.
• Upon being informed by Sy if the denial of the registration of the vehicle in Lee’s
ISSUE:
nam, Goodyear requested on July 10, 1997 the PNP to lift the stolen vehicle alarm
• Whether or not the complaint states a cause of action
status notwithstanding the fact that Goodyear was impleaded as third-party
defendant in the third-party complaint filed by Sy on January 9, 1998.
RULING:
• No. The Court ruled that the third party complaint filed by Sy is inadequate, because it did
PROCEDURE: not allege any act or omission that petitioner had committed in violation of his right to
the subject vehicle hence, the third element is missing.
TRIAL COURT:
• As emphasized by the Court, a cause of action, which is an act or omission by which a
• Goodyear filed a motion to dismiss on March 24, 1998 on the twin grounds that the third-
party complaint failed to state a cause of action and even if it did such cause of action was party violates the right of another has the following elements:
o The legal right of the plaintiff
already extinguished.
o The correlative obligation of the defendant to respect that legal right,
• An opposition was interposed by Sy on April 17, 1998.
o An act or omission of the defendant that violates such right.
• The RTC resolved to dismiss the third party complaint and ratiocinated that the complaint
• The complaint capitalized merely on the fact that the vehicle based on the records of the
does not expressly show any act or omission committed by the 3rd party defendant
PNP, considered a stranger to the case- was “a stolen vehicle”. I
which violates a right of the third party complainant.
• In addition, the pleading did not contain “sufficient notice of the cause of action” against
• The 3rd party complaint failed to show that the vehicle in question belongs to a person
the petitioner.
other than the 3rd party defendant at the time the said motor vehicle was sold by the third
• The complaint is insufficient on its face and failed to lay out the connection between the
party defendant to the third party plaintiff.
owner’s sale of the vehicle and the impounding by the PNP.
• On the contrary, the third party defendant has not denied having sold to the third party
• The fact that the police did not lift the alert status did not make the petitioner less of an
plaintiff the said motor vehicle which had been in its possession as owner from 1986 to
owner.
1996.
• The Deed of Sale attached to the third party complaint filed by Sy against Goodyear stated
• The vehicle was included by the PNP in its alert status when it was hijacked but when the
that the latter was the absolute owner of the vehicle.
said motor vehicle was recovered, the third party defendant (Goodyear) informed PNP
about the recovery and requested that the alert status as stolen vehicle be lifted. • It is worth noting that no contrary assertion was made in the complaint hence,
o The trial court correctly observed that the complaint failed to show that at the
time of its sale to Respondent Sy
o The vehicle belonged to a person other than petitioner.
• To reiterate, the Third Party Complaint absolutely failed to state an act or omission of
petitioner that had proximately caused injury or prejudice to Sy.

FALLO: WHEREFORE, the petition is GRANTED and the assailed decision and resolution are
REVERSED. The Order of the RTC is REINSTATED.

ISSUE (Non CIVPRO)


• Whether or not there was a breach of warranty.

RULING:
• No. In a contract of sale, there are implied warranties:
o First, the vendor has a right to sell the thing at the time that its ownership
is to pass to the vendee, as a result of which the latter shall from then on
have and enjoy the legal and peaceful possession of the thing;
o Second, the thing shall be free from any charge or encumbrance not
declared or known to the vendee.
• Goodyear did not break any of those. Certainly, the impoundment of the car was not
Goodyear’s fault and it was not a legal impediment that deprived Sy from ownership
of said car.
• When Sy sold the car to Lee, Sy was already the absolute owner. This is because when
Goodyear sold the car to Sy, Goodyear transferred full ownership to Sy.
• It was just unfortunate that the PNP did not lift the alert alarm from the said car
placed on it in 1986.
• Goodyear has no control over the PNP and PNP’s inaction is a purely administrative
and government in nature.
• Hence, Goodyear did not breach its obligation as a vendor to Sy; neither did it violate
Sy’s right for which he could maintain an action for the recovery of damages. Without
this crucial allegation of a breach or violation, no cause of action exists.
119. Aldemita v Heirs of Silva 7. The CA affirmed the Decision of the RTC in toto.
G.R. 166403 8. Hence, the instant Petition.
November 2, 2006 ISSUE
Topic: Motion to Dismiss W/N the MTD was a proper action
Petitioners:Benzon Aldemita
Respondents: Heirs of Melquiades Silva HELD
Ponente: J. Austria-Martinez No

FACTS RATIO

1. A Complaint for Quieting of Title was filed with the RTC by the Heirs of Melquiades Silva, The Motion to Dismiss should have been filed before the filing of any responsive pleading. It
represented by Ramon G. Villordon, Jr., against the Heirs of Dionisia Vda. De Zabate has appeared that it was in fact filed at the RTC after the case had been submitted for decision.
(represented by Emelia Deiparine and Benzon O. Aldemita), involving Lot 11330 of Pcs-945.
2. During the pre-trial, the parties made the following stipulations of facts and/or admissions, The reliance of the Petitioner on the old rules of court had led to this confusion. In the old law,
to wit: Sec. 2 provided that
1) [Petitioner] Aldemita admitted that Lot 11330 has been registered in the name of
Melquiades Silva as shown by Transfer Certificate No. T-18993 of the Registry of SEC. 2. Defenses and objections not pleaded deemed waived. - Defenses and objections not
Deeds and has been covered by Tax Declaration No. 25845-R also in the name of pleaded either in a motion to dismiss or in the answer are deemed waived; except the failure
Melquiades Silva; to state a cause of action which may be alleged in a later pleading, if one is permitted, or by
2) [Petitioner] Aldemita also admitted that the [respondents] in this case have been motion for judgment on the pleadings, or at the trial on the merits; but in the last instance, the
the ones in actual physical possession of the lot, except a 2,000-square-meter area motion shall be disposed of as provided in Section 5 of Rule 10 in the light of any evidence which
which said he is claiming to be possessed by him; may have been received. Whenever it appears that the court has no jurisdiction over the
3) [Petitioner] Aldemita admitted, too, that the document "Kalig-onan sa Palit” subject-matter, it shall dismiss the action
(Exhibit 1), purportedly executed on March 15, 1949 by Melquiades Silva in favor of
Vda. De Zabate involving the land in question, is actually a forged document. He They effectively assumed that where failure to state a cause of action was not deemed waived
contends, however that another document, the "Kalig-onan sa Panagpalit nga even if raised after the answer has been filed. However, since this case was filed in 1998, the
Dayon" (Exhibit 2) was also executed by Melquiades Silva in favor of Vda. De Zabate effective rules applicable were now the Revised Rules of Court of 1997. The applicable Rule
and that the latter was confirmed by Proferia Silva and Emeliana Zabate Paran in a now is Sec. 1 Rule 9 which reads;
Deed of Confirmation of Previous Deed of Sale executed on February 20, 1979.
3. The RTC appointed the PNP Regional Crime Laboratory Office VII as commissioner of the SECTION 1. Defenses and objections not pleaded. - Defenses and objections not pleaded either
court for the purpose of determining whether the purported signature of Melquiades Silva in in a motion to dismiss or in the answer are deemed waived. However, when it appears from the
Exhibit 1 and that of Porferia Silva in Exhibit 2. pleadings or the evidence on record that the court has no jurisdiction over the subject matter,
4. The parties manifested through their respective counsel that they would submit the case for that there is another action pending between the same parties for the same cause, or that the
decision without need of trial especially that the findings embodied in the commissioner’s action is barred by a prior judgment or by statute of limitations, the court shall dismiss the
report (that the signature of Silva was indeed forged) have already been considered as the claim.
findings of facts in this case.
5.After Aldemita filed a Position Paper with the Court, his counsel Atty. Manuel Paradela filed As it stands, only the following defenses are not waived even if not raised in a motion to dismiss
a Motion To Withdraw As Counsel. Immediately thereafter, the new counsel for petitioner or in the answer: (a) lack of jurisdiction over the subject matter; (b) litis pendentia; (c) res
Aldemita, Atty. Rodolfo Ugang, Sr., entered his appearance and filed a Motion to Dismiss for judicata; and (d) prescription on the action. Failure to state a cause of action is not an exception
lack of cause of action. in said Rule. Thus, under Section 1, Rule 16, petitioner is deemed to have waived this ground
• The Motion averred in main that the respondents should first be declared as heirs of and cannot now raise it after the case in the RTC had been submitted for decision or on appeal
Melquiades Silva in a special proceeding before they can be considered as real parties-in- to the CA.
interest to institute the action in this case.
6. The RTC denied the Motion for being belatedly filed. The Court also recognized the heirs of Dispositive : WHEREFORE, the instant petition is DENIED and the assailed Decision of the Court
Melquiades Silva as the real parties in interest who could institute an action for quieting of of Appeals is AFFIRMED.
title. Meanwhile, believing the Silva’s signature had been forged, the documents denominated
as "Kalig-onan Sa Palit" and "Kalig-onan sa Panagpalit nga Dayon," and the Deed of
Confirmation of Previous Deed of Sale were all declared to be null and void.
120 PDI v Alameda orders be annulled and set aside and civil case be dismissed for failure to state
GR NO. 160604 COA.
• CA dismissed petition à Review on certiorari SC by petitioners.
Topic: MOTION TO DISMISS
Petitioners: PHILIPPINE DAILY INQUIRER (PDI), ISAGANI YAMBOT, LETTY JIMENEZ- ISSUE:
MAGSANOC, PERGENITO B. BANDAYREL, JR., GOBLETH C. MOULIC, ESTANISLAO CALDEZ, and W/N the allegations are sufficient to seek for a dismissal through a motion to dismiss?
ZENAIDA CALDEZ
Respondents: HON. ELMO M. ALAMEDA, in his capacity as the Presiding Judge of the RULING:
REGIONAL TRIAL COURT OF TUGUEGARAO CITY, CAGAYAN, BRANCH 5, and LUZ CORTEZ • When a defendant seeks the dismissal of the complaint through a motion to
BABARAN, dismiss, the sufficiency of the motion should be tested on the strength of the
Ponente: allegations of facts contained in the complaint and on no other basis. The issue of
whether or not the complaint failed to state a cause of action, warranting its
FACTS dismissal, must be passed upon on the basis of the allegations stated therein
assuming them to be true and the court cannot inquire into the truth of the
• PDI published an article entitled “After Bong, who’s next?” The article is about the
death of Bong Caldez, a photo correspondent of PDI Cagayan. In the article, the allegations and declare them to be false; otherwise, it would be a procedural error
and a denial of due process to the plaintiff.
family of Bong laments the death of their loved one due to the alleged erroneous
diagnosis of Dr. Luz Babaran. • This Court finds that petitioners raised the threshold question of whether the
complaint sufficiently alleges a cause of action.
• PDI published another article with the heading “DOH orders probe of fotog’s
death.” Where it was reported that the DOH Tuguegarao has started investigating • Hence, the trial court should have granted petitioners' motion for a preliminary
the death of Caldez following the DOH’s Bureau of Licensing and Regulation order. hearing on the affirmative defenses raised in the answer based on failure to state a
cause of action. This procedure is designed to prevent a tedious, if not traumatic,
• Based on the 2 news columns, Dr. Babaran filed a complaint for damages against
trial in case the complaint falls short of sufficiently alleging a cause of action.
petitioners. She said after the first article, she wrote a letter to the editor but she
never received a response. Instead, another article was published where she was • WHEREFORE, the petition is GRANTED. The Resolution of the Court of Appeals
singled out as having erroneously diagnosed the illness of Caldez, contrary to the dated October 22, 2003 is REVERSED, and the case is REMANDED to RTC
report of the DOH Fact-Finding committee- that her diagnosis cannot be considered tuguegarao.
erroneous. That the articles portrayed her as incompetent, and that petitioners
acted in Bad Faith.
• Petitioners filed their answer with counterclaims, raising the following defenses:
That the complaint states no cause of action, complaint fails and omits to state
factual premise to support a conclusion of malice on their part, failure to allege
actual malice, and failure to establish the basis of petitioner’s liability.
• Pre-trial was held and terminated. Petitioners filed a Motion for a Preliminary
Hearing on Affirmative Defense Raised in the answer (also a ground for MTD). One
of the defenses raised was that private respondent has not delineated the
participation of each petitioner in the publication of the articles.
• Respondent’s counsel asked for a few days to determine if the complaint should be
amended to cure the defects. But they did not move to ament the complaint.
Hence, petitioners filed the motion.
• Petitioners prayed that a preliminary hearing be conducted on the affirmative
defense as the complaint failed to state a cause of action, hence, it should be
dismissed.
• Respondent filed a comment/opposition to the MTD based on the affirmative
defense. She said that the issue was not raised on pre-trial, therefore, it is no
longer an issue to be litigated. She prayed that court deny petitioner’s MTD.
• RTC denied motion.
• Petitioner filed MR- denied.
• Petitioner filed a petition for Certiorari and Prohibition, with prayer for the
issuance of TRO and/or preliminary injunction with the CA. They prayed that RTC
121. Heirs of Maramag v Maramag
G.R. No. 181132 Held:
June 5, 2009 • Grand of the MTD was based on trial court’s finding that the petition failed to state
a cause of action as provided in Rule 16, Sec.1 (g) of the Rules of Court
_____________________________________________________________________ • A cause of actions has 3 elements, (1) he legal right of the plaintiff; (2) correlative
Topic: Motion to Dismiss obligation of the defendant; (3) the act or omission of the defendant in violation of
Petitioner: Heirs of Loreto C. Maramag the legal right
Respondent: Eva Verna De Guzman Maramag, Odessa De Guzman Maramag • If any element is absent, the complaint becomes vulnerable to a motion to dismiss
_____________________________________________________________________ on the ground of failure to state a cause of action
• When a motion to dismiss is premised on this ground, the ruling thereon should be
Facts: based only on the facts alleged in the complaint. The court must resolve the issue
• Petitioners are legitimate heirs and legal wife of the late Loreto Maramag on the strength of such allegations, assuming them to be true. The test of
• Respondents are the alleged concubine and illegitimate children, as well as Insular sufficiency of a cause of action rests on whether, hypothetically admitting the facts
Life Insurance Company (Insular), and Great Pacific Life Assurance Corporation alleged in the complaint to be true, the court can render a valid judgment upon the
(Grepalife) same, in accordance with the prayer in the complaint. This is the general rule
• Petitioners filed a petition before the RTC for revocation and/or reduction of • However, this rule is subject to well-recognized exceptions, such that there is no
insurance proceeds for being void and/or inofficious hypothetical admission of the veracity of the allegations if:
• The complaint alleged that Eva, the concubine, was disqualified to receive as she is 1. the falsity of the allegations is subject to judicial notice;
a suspect to the killing of Loreto 2. such allegations are legally impossible; 

• It is also alleged that the illegitimate heirs were entitled only to one-half of the 3. the allegations refer to facts which are inadmissible in evidence; 

legitime of the legitimate children 4. by the record or document in the pleading, the allegations appear unfounded;
• Part of the insurance proceeds had already been released in favor of Odessa, while or
the rest are to be released in favor of Karl, and Angelie upon appointment of a legal 5. there is evidence which has been presented to the court by stipulation of the
guardian parties or in the course of the hearings related to the case
• In answer, Insular admitted Loreto misprepresented Eva as his legitimate wife, and • In this case, although they are legitimate heirs, they are not named as beneficiaries
disqualified her as a beneficiary and divided the proceeds among the illegitimate in the insurance policies issued by Insular and Grepalife
heirs as the remaining designated beneficiaries • The basis of petitioner’s claim is that Eva being a concubine, is disqualified from being
• Grepalife in its answer with compulsory counterclaim, allegedthat Eva was not designated a beneficiary
designated as an insurance policy beneficiary, and that the claims filed by the • They also argue that pursuant to Sec. 12 of the Insurance Code, Eva’s share should
illegitimate heirs were denied because Loreto was ineligible for insurance due to his be forfeited for bringing the death of Loreto
misrepresentation in his application form that he was born on December 10, 1936, • It is evident from the face of the complaint that petitioners are not entitled to a
thus not more than 65 years old when signed it in September 2001 favorable judgement in light of Art. 2011 which expressly provides that insurances
• Both Insular and Grepalife argue that the insurance proceeds belong exclusively to contracts shall be governed by special laws, i.e, the Insurance Code Sec. 53
the designated beneficiaries in the policies, not to the estate or heirs of the insured o The insurance proceeds shall be applied exclusively to the proper interest
• The RTC granted the motion to dismiss incorporated in the answers of defendants of the person in whose name or for whose benefit it is made unless
Insular and Grepalife with respect to the illegitimate heirs otherwise specified in the policy
• Insular and Grepalife moved for reconsiderations and the RTC granted it, dismissing • It is obvious therefore that the only persons entitled to claim are either the insured
the complaint for failure to state a cause of action or the beneficiary
• Petitioners reiterated earlier arguments that the dismissal must be determined • Petitioners are third parties to the insurance contracts
solely on the basis of the allegations in the complaint, and defenses to be better • The CA decision should also be sustained, the issue of failure to state a cause of
threshed out during trial action is a question of law and not of fact, there being no findings of fact in the first
• The RTC granted the MTD and the case against them DISMISSED place
• CA dismissed appeal for lack of jurisdiction, holding that decision involved a pure
question of law

Issue: W/N CA correctly granted the Motion to Dismiss? YES


122 Rural Bank of Calinog v. CA - In order to sustain a MTD based on lack of a cause of action – complaint must show
that the claim for relief does not exist rather than that a claim has been defectively
Facts: stated.
- Petitioners alleged that Carmen Cerbo executed a real estate mortgage over her - Based on the facts alleged, there definitely was a valid cause of action. It is enough
property in favor of the Rural Bank and that the mortgage was foreclosed and sold that respondents allege that they made a deposit in the amount of 18K after the
at public auction with Rural Bank as the highest bidder. mortgaged property was sold at public auction; that they obtained an agricultural
- Petitioners then redeemed the property by depositing the amount of 18K to Rural loan from Rural Bank. The net proceeds if whuch they paid petitioner in order to
Bank. discharge the obligation under the mortgaged Carmen Cerbo property. That the
- In order to complete payment of the redemption price of the property, petitioners excess amount was not accounted for and that the 18k deposit was not deducted
obtained a loan from Rural Bank of Dingle, Iloilo in the amount of 109K. In order to from the repurchase price.
secure such loan, petitioners mortgaged the subject property in favor of Dingle Bank. - it is significant to note that petitioner already filed an answer to the complaint at
- Petitioners paid the loan obtained from Rural Bank of Calinog and received a notice which it admitted that private respondent gregorio cerba made a deposit of 18k as
of sale at public auction of the property for failure to pay the mortgage debt. initial paymen and made a total of 101K payment. By this act, petitioner therefore
- Petitioners demanded from Rural Bank an accounting of all payments made and the acknowledged that it was gregorio cerba, Carmen cerbos son in law who was making
holding in abeyance by Dingle Bank of the sale. However, the public sale proceeded payments on the loan obligation and even referred to Gregorio as redemptioner.
as scheduled and the property was adjudicated in favor of Calinog Bank. This admission cannot be disavowed in the MTD claiming that respondents do not
- Petitioners and Carmen Cerbo filed annulment of certificate of sale at public auction. have cause of action against it just because Carmen cerbo passed away
- Calinog Bank then moved for dismissal of the complaint claiming that Carmen Cerbo
is the only one who has a cause of action against it because she was the one who
executed the real estate mortgage but since she is dead, the case should be
dismissed. Also claimed lack of cause of action and do not have legal personality to
represent Cerbo.
- Petitioners opposed the MTD claiming that as heirs of Carmen Cerbo, they have
personality and cause of action to sue.
- RTC granted the MTD filed Calinog Bank. Spouses Cerba filed with the CA a certiorari
questioning the dismissal of the case and claimed real party in interest.
- CA granted the certiorari and distinguished between lack of capacity to sue and lack
of personality to sue:
o Lack of capacity – plaintiffs general disability to sue such as minority,
incompetence, lack of juridical personality.
o Lack of personality – plaintiff is not the real party in interest.
- CA said that since they filed the civil suit not just as representatives of Cerbo but also
for and in their own behalf, they have both capacity and personality to sue.
- Petitioners assert that private respondents do not have a cause of action against it
because they did not claim that they were instituting a action as heirs of Carmen
Cerbo.

WON the complaint filed by respondents with RTC states a cause of action?

Held:
Requisites of Cause of Action:
1. right in favor of plaintiff
2. obligation on the part of the defendants to respect or not to violate such rights
3. an act or omission on the part of the defendant violative of the right of plaintiff or
breach of obligation

- the court said that complaint does not have to establish or allege the facts proving
the existence of a cause of action at this will be done in the trial.
123 MID PASIG LAND DEV. v. CA • RTC – RCCI filed a complaint for specific performance with prayer for the issuance of a
GR NO. 153751 temporary restraining order/writ of preliminary injunction.
October 8, 2003 o In its complaint, respondent argued that it had actually entered into a new lease
Topic: O. MOTION TO DISMISS – 1. GROUNDS contract with MPLDC for a (3) year term despite the lack of any written agreement. By
Petitioners: MID PASIG LAND DEVELOPMENT CORPORATION unqualifiedly and continuously accepting rental payments as well as allowing RCCI to
Respondents: COURT OF APPEALS, HON. RODRIGO B. LORENZO, in his capacity as Presiding remain in the property, MPLDC effectively accepted and ratified its offer of a (3) year
Judge of RTC-Pasig City, Branch 266 and ROCKLAND CONSTRUCTION COMPANY, INC. lease despite the absence of a categorical acceptance. The lease contract was thus
Ponente: YNARES – SANTIAGO perfected, giving RCCI the right to compel petitioner to execute an agreement.
• MPLDC filed a motion to dismiss on the ground that the complaint was anticipatory in
FACTS: nature, failed to state a cause of action and was not authorized by RCCI's Board of Directors.
• Mid-Pasig Land Development Corporation (MPLDC) leased a portion of its sequestered Moreover, RCCI's claim is unenforceable under the Statute of Frauds and the verification as
well as certification of non-forum shopping appended to the complaint did not comply with
property to ECRM Enterprises (ECRM). The leased area, which measures approximately (1)
Sections 4 and 5, Rule 7 of the Rules of Court.
hectare, is part of (2) lots registered under TCT Nos. 469702 and 337158 of the Register of
Deeds of Pasig City and is bounded by Meralco Avenue, Ortigas Avenue, Doña Julia Vargas • The resolution of MPLDC's motion to dismiss was deferred after the parties manifested their
Avenue and Valle Verde Subdivision. ECRM intended to use the area as staging ground for mutual desire to amicably settle the controversy. When the parties failed to reach a
its "Home and Garden Exhibition" from December 15, 1999 to March 15, 2000. compromise, MPLDC’s motion to dismiss was set for hearing at which MPLDC manifested
that it will file a complaint for ejectment as well as a supplemental motion to dismiss.
• Under the contract of lease, ECRM agreed to pay petitioner the amount of P1,650,000.00 as
rental for three months, inclusive of 10% value-added tax, with option to renew. The parties • MeTC – MPLDC filed for unlawful detainer. Almost simultaneously, MPLDC filed a
also stipulated that upon expiration of the lease agreement, ECRM shall without delay or supplemental motion seeking its dismissal on the ground of litis pendentia.
need of demand, turn over the property to petitioner in the same or improved condition. In • MLPDC argued in its supplemental motion that the issue of whether or not RCCI should be
case the contract is not renewed, ECRM would remove all temporary improvements at its allowed to continue occupying the land pursuant to the terms of the lease contract should
own expense within seven days after expiration of the lease. be threshed out in the ejectment case.
• ECRM irrevocably and absolutely assigned to Laurie M. Litam and/or respondent Rockland • RTC – denied MPLDC’s MTD – RCCI substantially complied with all the requirements for the
Construction Company, Inc. (RCCI) all its rights under the lease agreement. The deed of filing of an initiatory pleading and that the complaint stated a cause of action.
assignment provided for a total consideration of P1,650,000.00 and declared that, RCCI • RTC – also DISMISSED supplemental MTD. On the ground that there is no litis pendentia
would have full control of the leased property including right to the extension of the lease between case of specific performance and case for unlawful detainer because there was no
period. identity of cause of action between the two.
• Pursuant to the foregoing deed of assignment, respondent, in lieu of ECRM, delivered to • RTC – GRANTED TRO. MPLDC filed a MOR. MOR DENIED.
MPLDC the total sum of P1,650,000.00 as rental payment for the period of April 15 to July • CA – DISMISSED the petition. MOR DENIED.
15, 2000. MPLDC accepted the amount and issued the official receipt. • MPLDC’s contention – claims that there is identity of parties as well as rights and reliefs
• Later, RCCI verbally requested MPLDC for a renewal of the lease for a term of (3) years. This prayed for between the complaint pending before the RTC and the 2nd complaint for
was followed by a letter sent by RCCI to MPLCD explaining that the (3) year term would unlawful detainer filed with the MeTC. All the elements of litis pendentia are present in the
enable it to plan its activities more efficiently. Before the request was acted upon, MPLDC instant case, and a judgment in the 1st action will amount to res judicata in the 2nd
retroactively increased the monthly rental to P770,000.00 per month effective April 15, regardless of which party would prevail. MPLDC also asserts that it is the complaint for
2000. RCCI apparently agreed to the increased rate and paid petitioner the rent differential specific performance that should be dismissed notwithstanding the fact that it was filed
• RCCI erected a building on the leased area, also known as the "Payanig sa Pasig" site, and ahead of the unlawful detainer case.
sub-leased certain portions. However, in the first week of January 2001, respondent
received information that its sub-lessees were served by MPLDC with notices to vacate the ISSUE(S):
property. Even if it did not receive a similar notice, RCCI nevertheless wrote MPLDC 1. Whether the CA erred in saying that there is no litis pendentia? (YES)
requesting that a formal (3) year lease contract be executed in its favor. 2. Whether the action for unlawful detainer should be dismissed instead of the action for
• MPLDC wrote RCCI claiming that it had not entered into any form of agreement with the specific performance? (NO)
latter. As a matter of fact, MPLDC stated that it had "already undertaken the necessary steps
to evict Rockland and the other possessors of the premises." MPLDC claimed that the HELD/RATIO:
assignment of the lease to RCCI was not valid as it was done without its consent and that • 1. In order to sustain a dismissal of an action on the ground of litis pendentia, the following
provisions of the lease agreement were violated. requisites must concur: (a) identity of parties, or at least such as representing the same
interest in both actions; (b) identity of rights asserted and relief prayed for, the relief being
PROCEDURE: founded on the same facts, and (c) identity in the two cases should be such that the
judgment that may be rendered in the pending case would, regardless of which party is
successful, amount to res judicata in the other. We find the foregoing requisites present in WHEREFORE, the instant petition is GRANTED. The decision of the Court of Appeals is hereby
the case at bar. REVERSED and SET ASIDE. Civil Case No. 68213 pending the Regional Trial Court of Pasig City
• There can be no question that the parties in RTC Case and MeTC Case No. 8788 are one and is ordered DISMISSED on the ground of litis pendentia.
the same. Anent the second and third requisites, a careful examination of the averments of
the complaint before the RTC reveals that the rights asserted and reliefs prayed for therein
are no different from those pleaded in the MeTC case, such that a judgment in one case
would effectively bar the prosecution of the other case.
• A perusal of the complaint for specific performance shows that its main purpose was to
prevent MPLDC from ejecting RCCI from the leased property. Although the complaint seeks
to compel MPLDC to execute a formal lease contract, its ultimate intent is to preclude
MPLDC from filing a complaint for ejectment and for respondent to maintain possession of
the property.
• It must be noted that the right to the execution of a formal agreement is hinged upon the
more fundamental issue of whether respondent has a right to the possession of the property
under the alleged implied contract of lease. In other words, the central issue to be resolved
in the specific performance case unmistakably boils down to RCCI's alleged right to
continued possession of the premises, which issue is essentially similar, if not identical, to
the one raised in the unlawful detainer case before the MeTC.
• Since the question of possession of the subject property is at the core of the two actions, it
can be said that the parties in the instant petition are actually litigating over the same
subject matter, which is the leased site, and on the same issue — respondent's right of
possession by virtue of the alleged contract.
• 2. It is the prior case for specific performance which should be dismissed.
• The more appropriate suit in which the controversy between the parties should be
determined is the unlawful detainer case before the MeTC. The latter court has exclusive
original jurisdiction over the subject matter and could grant appropriate relief even if the
same would entail compelling the plaintiff to recognize an implied lease agreement. The fact
that RCCI prayed for an order to compel MPLDC to execute a formal contract of lease would
not operate to divest the MeTC of its jurisdiction to hear and decide the main issue, which
pertains to material or de facto possession.
• The fact that the unlawful detainer suit was filed later is no bar to the dismissal of the action
for specific performance. Where there are two pending cases, the general rule is that the
second case filed should be dismissed under the maxim qui prior est tempore, potior est jure
(he who is earlier in time is stronger in law). However, the rule is not a hard and fast one, as
the "priority-in-time rule" may give way to the criterion of "more appropriate action."
• It has likewise been held that to determine which action should be dismissed given the
pendency of two actions, relevant considerations such as the following are taken into
account: (1) the date of filing, with preference generally given to the first action filed to be
retained; (2) whether the action sought to be dismissed was filed merely to preempt the
latter action or to anticipate its filing and lay the basis for its dismissal; and (3) whether the
action is the appropriate vehicle for litigating the issues between the parties.
• It appears that at the time of the filing of the RTC case, MPLDC had communicated to RCCI
that it filed an ejectment against it for violation of the original lease agreement. Thus, the
RTC case, while purportedly one for specific performance, is in reality a preemptive
maneuver intended to block the complaint for ejectment, considering that it was brought
merely three days after RCCI received the communication from MPLDC.
124. Francisco v Co Additionally, Co argued that assuming Francisco had a valid cause of action, the same
GR NO. 151339 is barred by res judicata based on the RTC decision on the second case.
January 31, 2006 • MeTC: Ruled in favor of Francisco. Co must pay Francisco per day as reasonable
Topic: Motion to Dismiss compensation until they vacate the property.
Petitioners: Editha Francisco • RTC: Affirmed MeTC. Francisco was indeed the owner as evidenced by the extra-
Respondents: Roque Co and Mariano Co judicial settlement. The lease contract expressly delineated the coverage of the lease
Ponente: Tinga, J. as totaling only three hectares, which excluded Francisco’s lot. On the issue of res
judicata, the courts found that it did not apply, owing to the absence of the requisite
FACTS: identity of causes of action. The current case concerned a complaint for forcible
• A parcel of land covered by a TCT under the name of Pastora Baetiong lies at the entry, while the earlier ones is the execution of a contract of lease. Case remanded
center of this case. to the MeTC for execution.
o This land started three different cases involving the same parties, which • CA: Reversed the lower courts. Complaint for forcible entry was barred by res
lasted for three decades. This case is the third case. Hence, based on the judicata. While there was a difference in the forms, there was nonetheless a
first two cases, the main issue is the applicability of res judicata. similarity of causes of action. The evidence to be presented by the parties in both
• The legal controversy rose after the death of Baetiong wherein a complaint for accion actions was that which would have a better right. Additionally, since the lease was
publiciana was filed against her heirs, which includes Francisco. The complaint was still in effect during the forcible entry, Francisco has no basis in alleging such.
filed by Co and it is regarding the subject matter and another property. This was Francisco’s lot is also included under the lease agreement.
assigned to the RTC.
• The complaint was settled when the parties entered into a Compromise Agreement, ISSUE:
which was approved by the court. In this agreement, the parties acknowledge the W/N the third case is barred by res judicata? YES
heirs of Baetiong as the owner of the properties. It was agreed that the heirs would
lease to Co a portion of the properties, which portion was already occupied by the HELD/RATIO:
Cos. The lease agreement was to subsist for 15 years from Oct. 1, 1983. Francisco argues that res judicata does not apply due to the difference in the causes of actions.
• Five years after, the heirs filed a Motion with the RTC, wherein they alleged that Co She also claims that he lot is outside the lease contract and that res judicata only applies to
was actually occupying a larger portion of their land. They prayed that a commission facts and circumstances existing when judgment was rendered. Additionally, four years had
be constituted for the proper enforcement of the agreement. RTC granted this elapsed since the final judgment in the second case and this new case is governed by new facts
motion but Co challenged it by way of Certiorari and Prohibition. This is the start of and conditions due to the intrusion of Co in her lot.
the second case.
• CA reversed the RTC and declared that the judgment in the first case was finally
terminated and executed. The constitution of a commission would serve no purpose There are two aspects of res judicata:
since the agreement itself mandated that the parties immediately conduct a 1. “Bar by Prior Judgment” – effect of a judgment as a bar to the prosecution of a
delineation of the property for the lease. Other CA judgments are the following: second action upon the same claim, demand, or cause of action.
o The Contract of Lease had an area of 3 hectares, which was occupied by 2. “Conclusiveness of Judgment” – Issues actually and directly resolved in a previous
Co; suit cannot again be raised in any future case between the same parties involving a
o On the claim that the leased area was in excess of 7,658 sq. meters, the different cause of action.
Court ruled that the heirs were precluded by laches and negligence as they
had remained silent for almost five years. In considering res judicata, the lower courts have considered only the first kind. The CA, in
• CA set aside the RTC order and declared the judgment agreement terminated and reversing the lower courts, invoked Mendiola v CA, which discussed that the test of identity of
executed. This attained finality in the SC. causes of action lies on whether the same evidence would support and establish the former
• Four years later, Francisco filed a complaint for forcible entry against Co before the and present causes of action. Applying this test, it appears that the present case could be
MeTC. This is where the third case starts. Francisco alleged that she was the owner barred by prior judgment.
of the land, which she inherited from her mother through a extra-judicial settlement
Still, the Court considers the second kind of res judicata. Conclusiveness of judgment operates
of estate that caused the subdivision of the property into several lots.
as a bar even if there is no identity between the first and second causes of judgment. Under
• Francisco maintained that Co, through agents, entered her lot and started fencing
the doctrine, any right or fact in issue directly adjudicated before a competent court in which
the property.
judgment is rendered on the merits is conclusively settled by the judgment therein and cannot
• Co, in their Answer, that the property Francisco was asserting her rights on was
be litigated between the parties and their privies whether or not the claim, demand, purpose,
covered under the Contract of Lease, which was executed pursuant to the prior
or subject matter of the two actions is the same.
agreement. Co also raised the doubt on the validity of Francisco’s estate claim.
This may operate to bar the second case even if there is no identity of causes of action since WHEREFORE, petition is granted in part. The CA decision is affirmed with modification that the
the judgment is already conclusive in the second case as to those matters directly determined ward of moral, exemplary damages, and attorney’s fees be deleted.
and not as to matters merely involved.

The compromise agreement in the former case speaks for itself. When the contract of lease
was executed, the compromise has already been fully implemented and duly enforce.
Additionally, it is very clear that the area occupied by Francisco is the property agreed upon
under the Contract of Lease.

It should be understood that the ruling of the CA in the earlier decision have the force of law.
Since the decision establishes the right of Co to occupy by way of lease a portion of the subject
matter, it becomes imperative for Francisco to establish her cause of action, which is that Co
was beyond that which they were entitled to occupy.

The complaint predicated Francisco’s cause of action on her alleged ownership without any
reference to the Contract of Lease. In answer, Co asserted that they had been in actual
possession. The MeTC did not dwell on Co’s claim. Instead, it proceeded from the initial
premise that Francisco’s claim is based on an extra-judicial settlement. Evidently, the MeTC
considered the lot beyond the scope of the lease because the leased area only covered three
lots, 2-E, 2-F-1, and 2-F-2, not 2-F-4, which is what Francisco was claiming. However, that was
contrary to the decision of the CA.

That being the case, it was not enough for Francisco to establish that she was the owner of 2-
F-4, which is the sole allegation in her complaint. Neither would it have been sufficient that
the lease did not cover her lot. By reason of the conclusiveness of the CA judgment, it was
essential on Francisco to establish that her lot was not among that portion which Co had been
occupying when the lease was executed. If Co was not occupying the lot, Francisco would have
the right to seek ejectment since the said lot would not fall under the CA ruling. However, since
the right to institute forcible entry or unlawful detainer extends only in the absence of the right
to hold possession, the burden lies on Francisco to establish that Co had no legal right to enter
into possession 2-F-4.

In order that ejectment could be justified, it was imperative on the lower courts to declare that
C had no existing right to possess the lot. However, no conclusion was drawn on such premise;
hence, the reversal of the CA must be sustained.

We must reverse the CA when it awarded damages since Francisco is not in bad faith when she
filed the suit. While she is aware that the issue in this case was already settled, the Court
cannot agree to the damages based on Co’s mental state. The law presumes good faith. The
bad faith of Francisco in filing was not proven.

No such exemplary damages as well since there was no such proof to warrant such award due
to the fact that Francisco did not act in a wanton, oppressive, or malevolent manner.

Attorney’s fees also cannot be awarded. This cannot be recovered as part of damages because
of the public policy that no premium should be placed on the right to litigate. This award must
be deleted where the other awards for damages are eliminated.
125 CRUZ v CA
GRN 164797 • When private respondents moved for a motion for reconsideration, the court
FEB 13 2006 reversed itself. Petitioners went to the CA but to no avail and ruled that one of the
elements of res judicata is lacking. Reasons:
TOPIC: Motion to dismiss o 1) The issue in the injunction case is the propriety of the demolition order
PETITIONER: Josefina M. Cruz and Ernestina M. Concepcion while in the present action; it is the inquiry of ownership of the subject
RESPONDENT: Hon. Court of Appeals, Second Division, Mariano “Boy” Bunag and Rolando land
Bunag. o 2) Mariano Bunag denied authorizing Carlos Bunag to sign to Verifief
PONENTE: Chico-Nazario Complaint in his behalf and therefore, Mariano Bunag cannot be
considered as party litigant. Hence, the dismissal of case no. 2 will not bar
DOCTRINE: Under the rule of res judicata, also known as "bar by prior judgment," a final the filing of the instant complaint, as one of the requisites of res judicata
judgment or order on the merits, rendered by a Court having jurisdiction of the subject is absent. There is no identity of parties.
matter and of the parties, is conclusive in a subsequent case between the same parties and o 3) Substantial justice
their successor-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 ISSUE/S:
capacity. The requisites essential for the application of the principle are: Whether or not all the elements of res judicata are present in the instant case
(1) there must be a final judgment or order;
(2) said judgment or order must be on the merits; RULING:
(3) the Court rendering the same must have jurisdiction on the subject matter and the YES. For the contention that the case was not dismissed on the merits, the court held that
parties; and following Sec 3 Rule 14 of the ROC, failure to appear on several hearings despite due notices
(4) there must be between the two cases identity of parties, identity of subject matter, and is a ground for failure to prosecute. Since the order did not qualify if it is with or without
identity of causes of action. prejudice, the general rule that it is with prejudice will apply. Such dismissal is one based on
merit.
There are 4 cases involved in the controversy • For the fourth element – identity of parties, subject matter and cause of action the
1. CC 4365 for unlawful detainer before the MTC of Gapan, Nueva Ecija which was court held that the reason of non-authorization is bereft of merit as it was the
decided in favor of petitioner Josefina Cruz and Ernestina Conception (Josefina Cruz defendants, as early as the pendency of the ejectment case, who informed the court
and Ernestina Conception vs Mariano Bunag, Rolando Bunag, Remedios Bunag et al) of the case for Quieting of Title.
2. CC 1600 for Quieting of Title before the RTC of Gapan, Nueva Ecija which was • If he really did not authorize Carlos Bunag to include him as one of the plaintiffs in
dismissed for failure to prosecute (Carlos Bunag, Elias Bunag Natividad, Mariano the Quieting of Title case, he could have easily questioned his inclusion therein at an
Bunag, Salud Bunag and Juliana Bunag vs Josefina Cruz, Ernestina Conception) earlier time. This, he did not do.
3. CC 2573-02 for Injunction before the RTC of Gapan which was dismissed on the • He executed his affidavit only on 14 April 2003 or more than three years after the
ground of res judicata ruling that there is substantial identity of parties in this case case for Quieting of Title has been dismissed, and after the Injunction case which he
and case no.2 (Mariano `Boy' Bunag and Rolando Bunag as Petitioners against Carlos and private respondent Rolando Bunag filed, was dismissed.
Bunag, Elias Bunag Natividad, Mariano Bunag, Salud Bunag Clanaoc and Juliana • It is evident that his affidavit is a mere afterthought executed after his Motion for
Bunag Arevalo as Defendants) Reconsideration in the injunction case was denied because the court gave no weight
4. (current controversy) CC 2583-02 for Annulment of Title with Damages before the on his counsel's allegation that he (Mariano Bunag) was unaware of the complaint
RTC of Gapan (private respondents Bunag vs petitioners Cruz) signed and filed by Carlos Bunag. It is too late in the day for him to claim lack of
knowledge. It is very clear that the execution of the affidavit is to make it appear that
PROCEDURE: there is no identity of parties in the instant case and in the case for Quieting of Title.
• Petitioners interposed a motion for outright dismissal of case no. 4 which was • Further, the principle of res judicata cannot be evaded by the mere inclusion of an
granted for the reason that the current case and case no. 2 had the same parties, additional party to the first and second action. Only substantial identity is necessary
subject matter and issue and case no.3 was already dismissed on the ground of res to warrant the application of res judicata and the addition or elimination of some
judicata. parties does not alter the situation.
• In all 3 cases, Mariano Bunag was included as party-plaintiff and Ernestina
Conception as party-defendant, the subject matter involves the same parcel of land On the issue of identity of causes of action, the court held that the underlying objectiver or
in Gapan City and the issue is the lawful title over the same. relies sought in both cases are essntially the same – adjudication of the ownership of the
• Clearly, not only res judicata but also accion pendente lite is present which the disputed lot. The two cases are different only in form but not in substance. If presentation of
plaintiffs should have revealed in their Certificate/Verification.
evidence will be allowed, it would entail presentation of evidence which should have been
adduced in the case for Quieting of Title.

The test to determine whether the causes of action are identical is to ascertain whether the
same evidence will sustain both actions, or whether there is an identity in the facts essential
to the maintenance of the two actions. If the same facts or evidence would sustain both, the
two actions are considered the same, and a judgment in the first case is a bar to the subsequent
action.

FALLO:
WHEREFORE, premises considered, the petition is GRANTED. The decision of the Court of
Appeals dated 19 March 2004 and its resolution dated 29 June 2004 are REVERSED and SET
ASIDE. Civil Case No. 2583-02 for Annulment of Title with Damages, pending before Branch 35
of the Regional Trial Court of Gapan City, Nueva Ecija, is herby ordered DISMISSED. With costs.

NOTE:
Elements:
1. There must be a final judgment or order
2. Said judgment or order must be on the merits
3. The court rendering the same must have jurisdiction over the subject matter
4. There must be between the two cases identity of parties, identity of subject matter
and identity of causes of action
126. RAYTHEON INTERNATIONAL, INC., petitioner, vs. STOCKTON W. ROUZIE, • Raytheon then filed a Rule 65 Petition with the Court of Appeals praying for the
JR., respondent. issuance of a writ of certiorari and a writ of injunction to set aside the twin orders
[G.R. No. 162894; February 26, 2008] of the trial court dated 13 September 2000 and 31 July 2001 and to enjoin the trial
court from conducting further proceedings.
FACTS/PROCEDURE: o The appellate court held that although the trial court should not have
• Brand Marine Services, Inc. (BMSI), a corporation duly organized and existing under confined itself to the allegations in the complaint and should have also
the laws of the State of Connecticut, United States of America, and respondent considered evidence aliunde in resolving petitioner’s omnibus motion, it
Stockton W. Rouzie, Jr., an American citizen, entered into a contract whereby BMSI found the evidence presented by petitioner, that is, the deposition of
hired Rouzie as its representative to negotiate the sale of services in several Walter Browning, insufficient for purposes of determining whether the
government projects in the Philippines for an agreed remuneration of 10% of the complaint failed to state a cause of action. The appellate court also stated
gross receipts. that it could not rule one way or the other on the issue of whether the
• Rouzie filed before the Arbitration Branch of the National Labor Relations corporations, including petitioner, named as defendants in the case had
Commission (NLRC) a suit against BMSI and Rust International, Inc. (RUST), for indeed merged together based solely on the evidence presented by
alleged nonpayment of commissions, illegal termination and breach of employment respondent. Thus, it held that the issue should be threshed out during
contract. trial Moreover, the appellate court deferred to the discretion of the trial
• Labor Arbiter rendered judgment ordering BMSI and RUST to pay respondent’s court when the latter decided not to desist from assuming jurisdiction on
money claims. the ground of the inapplicability of the principle of forum non conveniens.
• Upon appeal by BMSI, the NLRC reversed the decision of the Labor Arbiter and • Petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure
dismissed respondent’s complaint on the ground of lack of jurisdiction. before the Supreme Court
• Respondent elevated the case to this Court but was dismissed in a Resolution dated
26 November 1997. The Resolution became final and executory on 09 November Raytheon’s contention:
1998. • The written contract between Rouzie & BMSI included a valid choice of law
• Rouzie, then a resident of La Union, instituted an action for damages before the clause, that is, that the contract shall be governed by the laws of the State of
Regional Trial Court (RTC) of Bauang, La Union against Raytheon. Rouzie essentially Connecticut.
reiterated the allegations in the labor case, and Rouzie also averred that BMSI and • It also mentions the presence of foreign elements in the dispute, namely that
RUST as well as petitioner itself had combined and functioned as one company. the parties & witnesses involved are American corporations & citizens & the
• In its Answer, Raytheon alleged that contrary to respondent’s claim, it was a evidence to be presented is located outside the Philippines, that renders our
foreign corporation duly licensed to do business in the Philippines and denied local courts inconvenient forums. The foreign elements of the dispute
entering into any arrangement with respondent or paying the latter any sum of necessitate the immediate application of the doctrine of forum non
money. Petitioner also referred to the NLRC decision which disclosed that per the conveniens
written agreement between respondent and BMSI and RUST, denominated as
"Special Sales Representative Agreement," the rights and obligations of the parties ISSUE/S:
shall be governed by the laws of the State of Connecticut. 1. Whether the RTC had jurisdiction over the case. YES
• On 18 May 1999, petitioner filed an Omnibus Motion for Preliminary Hearing Based 2. Whether the complaint failed to state the Cause of Action. NO
on Affirmative Defenses and for Summary Judgment seeking the dismissal of the 3. Whether the complaint should be dismissed on the ground of forum non conveniens. NO
complaint on grounds of forum non conveniens and failure to state a cause of
action. Respondent opposed the same. Pending the resolution of the omnibus RULING:
motion, the deposition of Walter Browning was taken before the Philippine 1. Yes.
Consulate General in Chicago a. On the matter of jurisdiction over a conflicts-of-laws problem where the
• The RTC denied Raytheon’s omnibus motion. The trial court held that the factual case is filed in a Philippine court and where the court has jurisdiction over
allegations in the complaint, assuming the same to be admitted, were sufficient for the subject matter, the parties and the res, it may or can proceed to try
the trial court to render a valid judgment thereon. It also ruled that the principle of the case even if the rules of conflict-of-laws or the convenience of the
forum non conveniens was inapplicable because the trial court could enforce parties point to a foreign forum. This is an exercise of sovereign
judgment on petitioner, it being a foreign corporation licensed to do business in the prerogative of the country where the case is filed.
Philippines. b. Jurisdiction over the nature and subject matter of an action is conferred
by the Constitution and the law and by the material allegations in the
• Raytheon filed a Motion for Reconsideration of the order, which motion was
complaint, irrespective of whether or not the plaintiff is entitled to
opposed by respondent. In an Order dated 31 July 2001, the trial court denied
recover all or some of the claims or reliefs sought therein. Civil Case No.
petitioner’s motion.
1192-BG is an action for damages arising from an alleged breach of ground, it should do so only after vital facts are established, to determine
contract. Undoubtedly, the nature of the action and the amount of whether special circumstances require the court’s desistance.
damages prayed are within the jurisdiction of the RTC.
c. As regards jurisdiction over the parties, the trial court acquired
jurisdiction over herein respondent (as party plaintiff) upon the filing of FALLO: WHEREFORE, the instant petition for review on certiorari is DENIED. The Decision and
the complaint. On the other hand, jurisdiction over the person of Resolution of the Court of Appeals in CA-G.R. SP No. 67001 are hereby AFFIRMED. Costs
petitioner (as party defendant) was acquired by its voluntary appearance against petitioner.
in court.
2. No.
a. Failure to state a cause of action refers to the insufficiency of allegation in
the pleading. As a general rule, the elementary test for failure to state a
cause of action is whether the complaint alleges facts,which if true would
justify the relief demanded.
b. The complaint alleged that petitioner had combined with BMSI and RUST
to function as one company. Petitioner contends that the deposition of
Walter Browning rebutted this allegation. On this score, the resolution of
the Court of Appeals is instructive, thus:
i. x x x Our examination of the deposition of Mr. Walter Browning
as well as other documents produced in the hearing shows that
these evidence aliunde are not quite sufficient for us to mete a
ruling that the complaint fails to state a cause of action.
ii. Annexes "A" to "E" by themselves are not substantial,
convincing and conclusive proofs that Raytheon Engineers and
Constructors, Inc. (REC) assumed the warranty obligations of
defendant Rust International in the Makar Port Project in
General Santos City, after Rust International ceased to exist
after being absorbed by REC. Other documents already
submitted in evidence are likewise meager to preponderantly
conclude that Raytheon International, Inc., Rust International[,]
Inc. and Brand Marine Service, Inc. have combined into one
company, so much so that Raytheon International, Inc., the
surviving company (if at all) may be held liable for the
obligation of BMSI to respondent Rouzie for unpaid
commissions. Neither these documents clearly speak
otherwise.
c. As correctly pointed out by the Court of Appeals, the question of whether
petitioner, BMSI and RUST merged together requires the presentation of
further evidence, which only a full-blown trial on the merits can afford.
3. No.
a. Under the doctrine of forum non conveniens, a court, in conflicts-of-laws
cases, may refuse impositions on its jurisdiction where it is not the most
"convenient" or available forum and the parties are not precluded from
seeking remedies elsewhere. Petitioner’s averments of the foreign
elements in the instant case are not sufficient to oust the trial court of its
jurisdiction over Civil Case No. No. 1192-BG and the parties involved.
b. Moreover, the propriety of dismissing a case based on the principle of
forum non conveniens requires a factual determination; hence, it is more
properly considered as a matter of defense. While it is within the
discretion of the trial court to abstain from assuming jurisdiction on this
128. Radiowealth Finance Company vs. Del Rosario payment charges, shall at once become due and payable without need of notice
G.R. No. 138739 or demand.
July 6, 2000 • Thereafter, respondents defaulted on the monthly installments. Despite repeated demands,
they failed to pay their obligations under their Promissory Note.
TOPIC: Demurrer • On June 7, 1993, petitioner filed a Complaint for the collection of a sum of money before the
PETITIONER: RADIOWEALTH FINANCE COMPANY RTC. During the trial, Jasmer Famatico, the credit and collection officer of petitioner, presented
RESPONDENT: Spouses VICENTE and MA. SUMILANG DEL ROSARIO in evidence the respondents’ check payments, the demand letter dated July 12, 1991, the
PONENTE: PANGANIBAN, J. customer’s ledger card for the respondents, another demand letter and Metrobank dishonor
slips. Famatico admitted that he did not have personal knowledge of the transaction or the
Spouses Vicente and Maria Sumilang del Rosario (defendants), jointly and severally executed, signed execution of any of these pieces of documentary evidence, which had merely been endorsed
and delivered in favor of Radiowealth Finance Company (plaintiff), a Promissory Note (PN) for to him.
P138,948. The parties agreed that if default be made in the payment of any of the installments or late • On July 4, 1994, the trial court issued an Order terminating the presentation of evidence for the
payment charges thereon as and when the same becomes due and payable, the total principal sum petitioner. Thus, the latter formally offered its evidence and exhibits and rested its case on July
then remaining unpaid, together with the agreed late payment charges, shall at once become due and 5, 1994.
payable without need of notice or demand. • Respondents filed on July 29, 1994 a Demurrer to Evidence for alleged lack of cause of action.
• On November 4, 1994, the trial court dismissed the complaint for failure of petitioner to
Defendants defaulted on the monthly installments. Despite repeated demands, they failed to pay their substantiate its claims, the evidence it had presented being merely hearsay.
obligations under their PN. Plaintiff filed a Complaint for the collection of a sum of money before the • On appeal, the Court of Appeals (CA) reversed the trial court and remanded the case for further
RTC Manila. During the trial, Jasmer Famatico, the credit and collection officer of plaintiff, presented proceedings. According to the appellate court:
in evidence the defendants' check payments, the demand letter, the customer’s ledger card, another o the judicial admissions of respondents established their indebtedness to the
demand letter and Metropolitan Bank dishonor slips. Famatico admitted that he did not have personal petitioner, on the grounds that they admitted the due execution of the Promissory
knowledge of the transaction or the execution of any of these pieces of documentary evidence, which Note, and that their only defense was the absence of an agreement on when the
had merely been endorsed to him. installment payments were to begin.
o Indeed, during the pretrial, they admitted the genuineness not only of the
Plaintiff formally offered its evidence and exhibits and defendants filed on a Demurrer to Evidence for Promissory Note, but also of the demand letter dated July 12, 1991. Even if the
alleged lack of cause of action. The trial court dismissed the complaint for failure of petitioner to petitioner’s witness had no personal knowledge of these documents, they would
substantiate its claims, the evidence it had presented being merely hearsay. still be admissible “if the purpose for which [they are] produced is merely to establish
the fact that the statement or document was in fact made or to show its tenor[,] and
On appeal, the CA reversed the trial court and remanded the case for further proceedings. such fact or tenor is of independent relevance.”
o Articles 19 and 22 of the Civil Code require that every person must—in the exercise
Held of rights and in the performance of duties—act with justice, give all else their due,
While the CA correctly reversed the trial court, it erred in remanding the case "for further proceedings. and observe honesty and good faith.
o The rules on evidence are to be liberally construed in order to promote their
objective and to assist the parties in obtaining just, speedy and inexpensive
DOCTRINE: determination of an action.
1. Defendants who present a demurrer to the plaintiff’s evidence retain the right to present
their own evidence, if the trial court disagrees with them, but if the trial court agrees with ISSUE and HELD & RATIO
them, but on appeal, the appellate court disagrees with both of them and reverses the
dismissal order, the defendants lose the right to present their own evidence; Demurrer What is the legal effect of demurrer of evidence?
aims to discourage prolonged litigations. • Petitioner contends:
2. Where the Court of Appeals reversed a demurrer to evidence rendered by a trial court, it o if a demurrer to evidence is reversed on appeal, the defendant should be deemed to
should render judgment on the basis of the evidence submitted by plaintiff instead of have waived the right to present evidence, and the appellate court should render
remanding the case for further proceedings. judgment on the basis of the evidence submitted by the plaintiff.
3. A party who did not appeal cannot obtain affirmative relief other than that granted in the o A remand to the trial court “for further proceedings” would be an outright defiance
appealed decision. of Rule 33, Section 1 of the 1997 Rules of Court.
• Respondents argue:
FACTS: o the petitioner was not necessarily entitled to its claim, simply on the ground that
they lost their right to present evidence in support of their defense when the
• On March 2, 1991, Spouses Vicente and Maria Sumilang del Rosario (herein respondents), Demurrer to Evidence was reversed on appeal.
jointly and severally executed, signed and delivered in favor of Radiowealth Finance Company o CA merely found them indebted to petitioner but was silent on when their obligation
(herein petitioner), a Promissory Note5 for P138,948. became due and demandable.
o The parties agreed that if default be made in the payment of any of the installments • SC:
or late payment charges thereon as and when the same becomes due and payable, o defendants who present a demurrer to the plaintiff’s evidence retain the right to
the total principal sum then remaining unpaid, together with the agreed late present their own evidence, if the trial court disagrees with them; if the trial court
agrees with them, but on appeal, the appellate court disagrees with both of them their first installment bounced. As for the disputed documents submitted by the
and reverses the dismissal order, the defendants lose the right to present their own petitioner, the CA ruling in favor of their admissibility, which was not challenged by
evidence. The appellate court shall, in addition, resolve the case and render the respondents, stands. A party who did not appeal cannot obtain affirmative relief
judgment on the merits, inasmuch as a demurrer aims to discourage prolonged other than that granted in the appealed decision.
litigations.
o In the case at bar, the trial court, acting on respondents’ demurrer to evidence, Whether the prayer of petitioner of 14% interest should be granted.
dismissed the Complaint on the ground that the plaintiff had adduced mere hearsay • Petitioner prayed for “14% interest per annum from May 6, 1993 until fully paid.”
evidence. However, on appeal, the appellate court reversed the trial court because • SC: We disagree.
the genuineness and the due execution of the disputed pieces of evidence had in o The Note already stipulated a late payment penalty of 2.5 percent monthly to be
fact been admitted by defendants. added to each unpaid installment until fully paid.
o Applying Rule 33, Section 1 of the 1997 Rules of Court, the CA should have rendered o Payment of interest was not expressly stipulated in the Note.
judgment on the basis of the evidence submitted by the petitioner. o Thus, it should be deemed included in such penalty.
o While the appellate court correctly ruled that “the documentary evidence o In addition, the Note also provided that the debtors would be liable for attorney’s
submitted by the [petitioner] should have been allowed and appreciated x x x,” and fees equivalent to 25 percent of the amount due in case a legal action was instituted
that “the petitioner presented quite a number of documentary exhibits x x x and 10 percent of the same amount as liquidated damages. Liquidated damages,
enumerated in the appealed order,” we agree with petitioner that the CA had however, should no longer be imposed for being unconscionable.
sufficient evidence on record to decide the collection suit. A remand is not only o Such damages should also be deemed included in the 2.5 percent monthly penalty.
frowned upon by the Rules, it is also logically unnecessary on the basis of the facts o Furthermore, we hold that petitioner is entitled to attorney’s fees, but only in a sum
on record. equal to 10 percent of the amount due which we deem reasonable under the proven
facts.

When did the obligation become due and demandable? Whether moral and other damages should be granted.
• Petitioner claims: • The Court deems it improper to discuss respondents’ claim for moral and other damages.
o that respondents are liable for the whole amount of their debt and the interest • Not having appealed the CA Decision, they are not entitled to affirmative relief, as already
thereon, after they defaulted on the monthly installments. explained earlier.
• Respondents counter:
o Respondents counter that the installments were not yet due and demandable.
o Petitioner had allegedly allowed them to apply their promotion services for its
financing business as payment of the Promissory Note.
o This was supposedly evidenced by the blank space left for the date on which the
installments should have commenced.
o the action for immediate enforcement of their obligation is premature because its
fulfillment is dependent on the sole will of the debtor. Hence, the proper court should
first fix a period for payment, pursuant to Articles 1180 and 1197 of the Civil Code.
• SC:
o The act of leaving blank the due date of the first installment did not necessarily mean
that the debtors were allowed to pay as and when they could. If this was the
intention of the parties, they should have so indicated in the Promissory Note.
However, it did not reflect any such intention.
o the Note expressly stipulated that the debt should be amortized monthly in
installments of P11,579 for twelve consecutive months. While the specific date on
which each installment would be due was left blank, the Note clearly provided that
each installment should be payable each month.
o it also provided for an acceleration clause and a late payment penalty, both of which
showed the intention of the parties that the installments should be paid at a definite
date. Had they intended that the debtors could pay as and when they could, there
would have been no need for these two clauses.
o In this case, the conclusion that the installments had already become due and
demandable is bolstered by the fact that respondents started paying installments
on the Promissory Note, even if the checks were dishonored by their drawee bank.
We are convinced neither by their avowals that the obligation had not yet matured
nor by their claim that a period for payment should be fixed by a court.
o The obligation of the respondents had matured and they clearly defaulted when
their checks bounced. Per the acceleration clause, the whole debt became due one
month (April 2, 1991) after the date of the Note because the check representing
129. Heirs of Santioque v. Heirs of Calma • The heirs of Santioque appealed said order to the CA. They likewise wrote to the Director
GR NO. 160832 of NBI to investigate the disappearance of the copy of the Registrar of Deeds of Tarlac of
OCTOBER 27, 2006 OCT and TCT.
Topic: DEMURRER; SEC. 1, RULE 33 • Without waiting for the report of the NBI on their request, the heirs of Santioque filed a
Petitioners: THE HEIRS OF EMILIO SANTIOQUE, represented by FELIMON W. SANTIOQUE motion with the CA for the early resolution of the case.
Respondents: THE HEIRS OF EMILIO CALMA, FABIAN CALMA, AGATONA CALMA, and • CA affirmed the appealed decision. It did not give probative weight to the certifications
DEMETRIA CALMA, represented by LOPE AKOL and LUCIA CALMA-AKOL, and the REGISTER OF and other documents submitted by the heirs of Santioque, as their authenticity had not
DEEDS OF THE PROVINCE OF TARLAC been established and the signatories therein were not presented for cross-examination.
Ponente: CALLEJO, SR., J. It noted that none of the “crucial documents” were presented in the trial court.

DOCTRINE: Demurrer to evidence authorizes a judgment on the merits of the case without the ISSUE
defendant having to submit evidence on his part as he would ordinarily have to do, if it is shown 1. WON the RTC erred in granting the demurrer to evidence of respondents? – NO.
by plaintiff’s evidence that the latter is not entitled to the relief sought. 2. WON petitioners’ claim is barred by prescription and laches? – YES.

FACTS HELD
• The Governor General granted a homestead patent over a 20.9740-hectare parcel of land 1. NO. The Court holds that CA ruling which affirmed that of the RTC granting the demurrer
located in Tarlac. On the basis of said patent, an Original Certificate of Title (OCT) was is correct.
issued by the Register of Deeds. OCT was cancelled by a new TCT. Then, the new TCT was • Demurrer to evidence authorizes a judgment on the merits of the case without the
again cancelled by TCT under the names of the heirs of Calma. defendant having to submit evidence on his part as he would ordinarily have to do,
• Fabian Calma died intestate. Lucia Calma was appointed as administratrix of the if it is shown by plaintiff’s evidence that the latter is not entitled to the relief sought.
estate. The heirs executed a Deed of Partition over the property. o The demurrer, therefore, is an aid or instrument for the expeditious
termination of an action, similar to a motion to dismiss, which a court or
• Meanwhile, in 1967, said parcel of land located in Tarlac was declared for taxation
tribunal may either grant or deny.
purposes under the name of Emilio Santioque. However, the declaration did not bear the
name and signature of the declarant. • A demurrer to evidence may be issued when, upon the facts and the law, the plaintiff
has shown no right to relief. Where the plaintiff’s evidence together with such
• Santioque died intestate. His children filed a complaint in the RTC of Tarlac for
inferences and conclusions as may reasonably be drawn therefrom does not warrant
declaration of nullity of title, reconveyance, with damages, over a piece of land situated
in Tibag, Tarlac City. recovery against the defendant, a demurrer to evidence should be sustained.
o The heirs claimed that Emilio was awarded Homestead Patent No. 18577 by • A demurrer to evidence is likewise sustainable when, admitting every proven fact
virtue of Homestead Application No. 132104.OCT No. 1112 was issued to Emilio favorable to the plaintiff and indulging in his favor all conclusions fairly and
on April 21, 1932, and from then had enjoyed full ownership and dominion over reasonably inferable therefrom, the plaintiff has failed to make out one or more of
the said lot. the material elements of his case, or when there is no evidence to support an
allegation necessary to his claim. It should be sustained where the plaintiff’s
• The heirs of Calma filed a motion to dismiss the complaint alleging that (a) the action had
prescribed and was barred by laches; (b) the claim has been abandoned, and (c) the evidence is prima facie insufficient for a recovery.
o In the present case, petitioners failed to prove the material allegations in
complaint stated no cause of action.
their complaint that Emilio Santioque applied for and was granted Patent
• The court denied the motion.
No. 18577 and that OCT No. 1112 was issued on the basis thereof.
• The heirs of Calma filed their answer, reiterating the grounds and allegations in their
o Petitioners even failed to present Homestead Application No. 132104
motion to dismiss by way of special and affirmative defenses.
allegedly led by Emilio with the Bureau of Lands. In fact, as evidenced by
• Felimon admitted that Amando Bangayan, Chief, Records Management Division of the
the Certi cation of the LMB, it had no record of said application and patent.
LMB certified that, based on the survey records of Cadastral Survey and as indicated in
The records of the LMB relative to Cadastral Case No. 61 and LRC Cad.
the Area Sheet Emilio Santioque was the claimant of the lot. However, the Bureau had no
Record No. 1879 were, likewise, not presented.
available records of Homestead Application No. 132104 and Homestead Patent.
• Under Section 14 of Commonwealth Act 141, The Public Land Act, there are certain
• The Register of Deeds issued a certification stating that despite diligent efforts, he could
requirements that a homestead applicant should comply with before a patent could
not locate OCT No. 1112 or any document showing how it was cancelled.
be issued to him.
• After the heirs of Santioque rested their case, the defendants, heirs of Calma, demurred
o Petitioners failed to present competent and credible evidence that Emilio
to plaintiffs’ evidence and sought its dismissal on the ground that the latter failed to Calma complied with the aforesaid requirements before his death.
establish a preponderance of evidence to support their ownership over the property.
• Petitioners rely on the tax documents to substantiate their claim over the subject
• RTC issued an Order granting the demurrer and dismissing the complaint on the ground property. However, it is axiomatic that tax receipts and tax declarations of ownership
that plaintiffs failed to establish their case.
for taxation purposes do not constitute sufficient proof of ownership. They must be
supported by other effective proofs.
• It is well settled that courts will consider as evidence only that which has been
formally offered, otherwise, the opposing party would be denied due process of law.
o The appellate court was also correct in not giving credence to the
certifications which petitioners submitted before it on the ground that the
said documents were not presented in the trial court.
• Petitioners, however, contend that they could have presented the said documents
during the rebuttal stage of the proceedings before the trial court.
o It is true that petitioners failed to adduce rebuttal evidence because
respondents filed a Demurrer to Evidence. However, petitioners should
have filed a motion for new trial based on newly-discovered evidence
under Rule 37, Section 2 of the 1997 Rules of Civil Procedure after the trial
court granted the demurrer and dismissed the complaint.

2. YES. We agree with the appellate court that petitioners' complaint is barred by
prescription and laches.
• An action for reconveyance prescribes in ten years, the point of reference being the
date of registration of the deed or the date of issuance of the certificate of title over
the property.
o Even if we reckon the prescription period from TCT No. 19181 issued
on November 27, 1953, the only title verified to be in the name of
respondents, more than ten years have already elapsed since then until
the time the petitioners filed their complaint on February 29, 1998.An
action for reconveyance is imprescriptible only when the plaintiff is in
actual possession of the property. In the present case, there is no showing
that petitioners were in actual possession of the subject property.
• The essence of laches or “stale demands” is the failure or neglect for an
unreasonable and unexplained length of time to do that which, by exercising due
diligence, could or should have been done earlier, thus giving rise to the presumption
that the party entitled to assert it either has abandoned or declined to assert it.
• An action for reconveyance or quieting of title instituted only after 30 years could be
barred by laches.
o This being so, all the more should an action to recover title, filed after 45
years, be barred by laches where the complainant's title is itself clearly
doubtful.

DISPOSITION
This being so, all the more should an action to recover title, led after 45 years, be barred by
laches where the complainant's title is itself clearly doubtful.
130.) Pinga vs. Santiago Ruymann and Domingo v. Santos, which noted those instances in which a
GR NO. 170354 counterclaim could not remain pending for independent adjudication.
June 30, 2006 • RTC promulgated an order granting respondents Motion for Reconsideration and
Petitioner: Edgardo Pinga dismissing the counterclaim, citing as the only ground therefor that there is no
Respondent: CARPIO, CARPIO MORALES, THE HEIRS OF GERMAN TINGA, and opposition to the Motion for Reconsideration of the [respondents].
SANTIAGO represented by VELASCO, JR. JJ., FERNANDO SANTIAGO, • Notably, respondents filed an Opposition to Defendants Urgent Motion for
By: Martin Reconsideration, wherein they argued that the prevailing jurisprudential rule is that
FACTS compulsory counterclaims cannot be adjudicated independently of plaintiffs cause
of action, and a conversu, the dismissal of the complaint carries with it the
• Petitioner Eduardo Pinga was named as one of two defendants in a complaint for
dismissal of the compulsory counterclaims.
injunction filed with the RTC of San Miguel, Zamboanga del Sur, by respondent
Heirs of German Santiago, represented by Fernando Santiago. The • The matter was elevated to this Court directly by way of a Petition for Review
Complaint alleged in essence that petitioner and co-defendant Vicente Saavedra under Rule 45 on a pure question of law.
had been unlawfully entering the coco lands of the respondent, cutting wood and ISSUE
bamboos and harvesting the fruits of the coconut trees therein. Respondents Whether the dismissal of the complaint necessarily carries the dismissal of the compulsory
prayed that petitioner and Saavedra be enjoined from committing acts of counterclaim.
depredation on their properties, and ordered to pay damages. HELD/RATIO
Yes
• In their Amended Answer with Counterclaim, petitioner and his co-defendant
disputed respondents ownership of the properties in question, asserting that • We hold that under Section 3, Rule 17 of the 1997 Rules of Civil Procedure, the
petitioners father, Edmundo Pinga, from whom defendants derived their interest in dismissal of the complaint due to the fault of plaintiff does not necessarily carry
the properties, had been in possession thereof since the 1930s. They alleged that with it the dismissal of the counterclaim, compulsory or otherwise. In fact, the
as far back as 1968, respondents had already been ordered ejected from the dismissal of the complaint is without prejudice to the right of defendants to
properties after a complaint for forcible entry was filed by the heirs of Edmundo prosecute the counterclaim.
Pinga. It was further claimed that respondents application for free patent over the • The RTC, in dismissing the counterclaim, did not expressly adopt respondents
properties was rejected by the Office of the President in 1971. Defendants in turn argument that the dismissal of their complaint extended as well to the
prayed that owing to respondents forcible re-entry in the properties and the counterclaim. Instead, the RTC justified the dismissal of the counterclaim on the
irresponsible and reckless filing of the case, they be awarded various types of ground that there is no opposition to [plaintiffs] Motion for Reconsideration
damages instead in amounts totaling P2,100,000 plus costs of suit. [seeking the dismissal of the counterclaim].
• By July of 2005, the trial of the case had not yet been completed. Moreover, • This explanation is hollow, considering that there is no mandatory rule requiring
respondents, as plaintiffs, had failed to present their evidence. It appears that the that an opposition be filed to a motion for reconsideration without need for a court
RTC already ordered the dismissal of the complaint after respondents counsel had order to that effect; and, as posited by petitioner, the failure to file an opposition
sought the postponement of the hearing scheduled then. However, the order of to the Plaintiffs Motion for Reconsideration is definitely not one among the
dismissal was subsequently reconsidered by the RTC in an Order, which took into established grounds for dismissal [of the counterclaim].
account the assurance of respondents counsel that he would give priority to that • he dismissal of the counterclaim by the RTC betrays at very least a tacit recognition
case. of respondents argument that the counterclaim did not survive the dismissal of the
• At the hearing of 27 July 2005, plaintiffs counsel on record failed to appear, sending complaint. At most, the dismissal of the counterclaim over the objection of the
in his stead a representative who sought the postponement of the hearing. Counsel defendant (herein petitioner) on grounds other than the merits of the
for defendants (who include herein petitioner) opposed the move for counterclaim, despite the provisions under Rule 17 of the 1997 Rules of Civil
postponement and moved instead for the dismissal of the case. The RTC noted that Procedure, constitutes a debatable question of law, presently meriting justiciability
it was obvious that respondents had failed to prosecute the case for an through the instant action. Indeed, in reviewing the assailed orders of the RTC, it is
unreasonable length of time, in fact not having presented their evidence yet. On inevitable that the Court consider whether the dismissal of the complaint, upon
that ground, the complaint was dismissed. At the same time, the RTC allowed motion of the defendant, on the ground of the failure to prosecute on plaintiffs
defendants to present their evidence ex-parte. part precipitates or carries with it the dismissal of the pending counterclaims.
• Respondents filed a Motion for Reconsideration of the order issued in open court • Our core discussion begins with Section 3, Rule 17 of the 1997 Rules of Civil
on 27 July 2005, opting however not to seek that their complaint be reinstated, but Procedure, which states:
praying instead that the entire action be dismissed and petitioner be disallowed o SEC. 3. Dismissal due to fault of plaintiff.If, for no justifiable
from presenting evidence ex-parte. Respondents claimed that the order of the RTC cause, the plaintiff fails to appear on the date of the presentation
allowing petitioner to present evidence ex-parte was not in accord with established of his evidence in chief on the complaint, or to prosecute his
jurisprudence. They cited cases, particularly City of Manila v. action for an unreasonable length of time, or to comply with
these Rules or any order of the court, the complaint may be purpose of procedural rules is to provide the means for the vindication of rights. A
dismissed upon motion of defendant or upon the court's own party with a valid cause of action against another party cannot be denied the right to
motion, without prejudice to the right of the defendant to relief simply because the opposing side had the good fortune of filing the case first.
prosecute his counterclaim in the same or in a separate action. Yet this in effect was what had happened under the previous procedural rule and
This dismissal shall have the effect of an adjudication upon the correspondent doctrine, which under their final permutation, prescribed the
merits, unless otherwise declared by the court. automatic dismissal of the compulsory counterclaim upon the dismissal of the
• The express qualification in the provision that the dismissal of the complaint due to complaint, whether upon the initiative of the plaintiff or of the defendant.
the plaintiffs fault, as in the case for failure to prosecute, is without prejudice to the • Thus, the present rule embodied in Sections 2 and 3 of Rule 17 ordains a more
right of the defendant to prosecute his counterclaim in the same or separate action. equitable disposition of the counterclaims by ensuring that any judgment thereon is
• Whatever the nature of the counterclaim, it bears the same integral characteristics based on the merit of the counterclaim itself and not on the survival of the main
as a complaint; namely a cause (or causes) of action constituting an act or omission complaint. Certainly, if the counterclaim is palpably without merit or suffers
by which a party violates the right of another. The main difference lies in that the jurisdictional flaws which stand independent of the complaint, the trial court is not
cause of action in the counterclaim is maintained by the defendant against the precluded from dismissing it under the amended rules, provided that the judgment
plaintiff, while the converse holds true with the complaint. Yet, as with a complaint, or order dismissing the counterclaim is premised on those defects. At the same time,
a counterclaim without a cause of action cannot survive. if the counterclaim is justified, the amended rules now unequivocally protect such
• It would then seemingly follow that if the dismissal of the complaint somehow counterclaim from peremptory dismissal by reason of the dismissal of the complaint.
eliminates the cause(s) of the counterclaim, then the counterclaim cannot survive.
Yet that hardly is the case, especially as a general rule. More often than not, the WHEREFORE, the petition is GRANTED. The Orders dated 9 August 2005 and 10 October
allegations that form the counterclaim are rooted in an act or omission of the 2005 of Branch 29, Regional Trial Court of San Miguel, Zamboanga del Sur in Civil Case No. 98-
plaintiff other than the plaintiffs very act of filing the complaint. Moreover, such 012 are SET ASIDE. Petitioners counterclaim as defendant in Civil Case. No. 98-012 is
acts or omissions imputed to the plaintiff are often claimed to have occurred prior REINSTATED. The Regional Trial Court is ORDERED to hear and decide the counterclaim with
to the filing of the complaint itself. The only apparent exception to this deliberate dispatch.
circumstance is if it is alleged in the counterclaim that the very act of the plaintiff
in filing the complaint precisely causes the violation of the defendants rights. Yet
even in such an instance, it remains debatable whether the dismissal or withdrawal
of the complaint is sufficient to obviate the pending cause of action maintained by
the defendant against the plaintiff.
• These considerations persist whether the counterclaim in question is permissive or
compulsory. A compulsory counterclaim arises out of or is connected with the
transaction or occurrence constituting the subject matter of the opposing partys
claim, does not require for its adjudication the presence of third parties, and stands
within the jurisdiction of the court both as to the amount involved and the nature
of the claim.
• The fact that the culpable acts on which the counterclaim is based are founded within
the same transaction or occurrence as the complaint, is insufficient causation to
negate the counterclaim together with the complaint. The dismissal or withdrawal of
the complaint does not traverse the boundaries of time to undo the act or omission
of the plaintiff against the defendant, or vice versa. While such dismissal or
withdrawal precludes the pursuit of litigation by the plaintiff, either through his/her
own initiative or fault, it would be iniquitous to similarly encumber the defendant
who maintained no such initiative or fault. If the defendant similarly moves for the
dismissal of the counterclaim or neglects to timely pursue such action, let the
dismissal of the counterclaim be premised on those grounds imputable to the
defendant, and not on the actuations of the plaintiff.
• The formalistic distinction between a complaint and a counterclaim does not detract
from the fact that both of them embody causes of action that have in their end the
vindication of rights. While the distinction is necessary as a means to facilitate order
and clarity in the rules of procedure, it should be remembered that the primordial
131. Dael v. Sps. Beltran o Dael deceived the court when he filed the action knowing fully well that he was not
GR NO. 156470 the real party-in-interest representing himself as Frederick George Ghent Dael.
April 30, 2008 o Proper recourse should be appeal to CA under Rule 41 and not by way of petition
Topic: Dismissal of Actions for review on certiorari before the SC.
Petitioners: Frederick Dael
Respondents: Sps. Benedicto and Vilma Beltran ISSUES:
Ponente: Quisimbing 1. W/N the RTC err in dismissing the complaint with prejudice - YES
2. W/N Dael’s recourse to the SC by way of petition for review on certiorari under Rule 45 was
proper - YES
FACTS
- Dael filed before the RTC, Branch 34, Negros Oriental, a Complaint for breach of contract and
HELD/RATIO
damages against Sps. Beltran.
1. Sec 1, Rule 17, Rules of Civil Procedure
o He alleged that Sps. Beltran sold him a parcel of land located at Palayuhan, Siaton,
SECTION 1. Dismissal upon notice by plaintiff. A complaint may be dismissed by the plaintiff by filing a
Negros Occidental, but the Sps did not disclose that the land was subject to a
notice of dismissal at any time before service of the answer or of a motion for summary
previous mortgage.
judgment. Upon such notice being filed, the court shall issue an order confirming the dismissal. Unless
o Dael only discovered such when an extrajudicial foreclosure over the property was
otherwise stated in the notice, the dismissal is without prejudice, except that a notice operates as an
instituted and he was constrained to bid in the extrajudicial sale conducted.
adjudication upon the merits when filed by a plaintiff who has once dismissed in a competent court an
o After payment of P775,100 as bid price, possession and ownership of the property
action based on or including the same claim.
was delivered to him.
o The non-disclosure of the extrajudicial foreclosure constituted breach of contract
- It is mandatory that the trial court issue an order confirming such dismissal and, unless
on the implied warranties in a sale of property, and he is also claiming for damages
otherwise stated in the notice, the dismissal is without prejudice and could be accomplished
because he had to pay for the property twice.
by the plaintiff through mere notice of dismissal, and not through motion subject to approval
- Sps. Beltran filed a motion to dismiss stating that Dael has no cause of action, since the contract
by the court.
to sell stated that the vendor was Benedicto Beltran and the vendee was Frederick George
o Dismissal is ipso facto upon notice, and without prejudice unless otherwise stated
Ghent Dael, not the petitioner.
in the notice.
- The counsel for Dael, Atty. Palma, disclosed that petitioner is the father of Frederick George
o The trial court has no choice but to consider the complaint as dismissed, since the
Ghent Dael whose name appears as the contracting party in the Contract to Sell.
plaintiff may opt for such dismissal as a matter of right, regardless of the ground.
o Counsel moved to reset the hearing to enable Dael to withdraw and have the
- The argument of Sps. Beltran is untenable because Sec 1, Rule 17 does not encompass an
complaint dismissed, amended, or to enter into compromise agreement with the
MTD.
Sps.
- A plaintiff may file a notice of dismissal before service of the answer or a motion for summary
- RTC ordered Dael to clarify whether or not he and Frederick George Ghent Dael were one and
judgment.
the same person; whether or not they were Filipinos and residents of Dumaguete City; and
o Thus, upon the filing of the Notice of Dismissal by Dael, the Motion to Dismiss filed
whether or not Frederick George Ghent Dael was of legal age, and married, as stated in the
by Sps. Beltran became moot and academic and the trial court should have
Contract to Sell.
dismissed the case without prejudice based on the Notice of Dismissal filed by
o Dael did not comply. Instead, he filed for a Notice of Dismissal.
Dael.
- RTC granted Sps. Beltran’s motion to dismiss and dismissed the case with prejudice.
- To allow the case to be dismissed with prejudice would erroneously result in res judicata and
- Dael then filed for a motion for reconsideration, arguing that the RTC erred in dismissing the
imply that Dael can no longer file a case against Sps. Beltran without giving him a chance to
complaint with prejudice based on Sps. Beltran’s MTD, and not without prejudice based on his
present evidence to prove otherwise.
notice of dismissal.
o RTC denied.
2. Dael’s recourse to this Court by way of a petition for review on certiorari under Rule 45 is
- Dael’s arguments manifested in his Memorandum:
proper.
o The Rules of Civil Procedure provides that before the defendant has served his
- An order of dismissal, whether correct or not, is a final order.
answer or moved for a summary judgment, he has, as a matter of right, the
o It is not interlocutory because the proceedings were terminated; it leaves nothing
prerogative to cause the dismissal of a civil action filed, and such dismissal may be
more to be done by the lower court.
effected by a mere notice of dismissal.
o Therefore, the remedy of Dael is to appeal the order.
o Such dismissal is without prejudice except (a) where the notice of dismissal so
- Under the Rules of Court, a party may directly appeal to the Supreme Court from a decision of
provides; (b) where the plaintiff has previously dismissed the same case in a court
the trial court only on pure questions of law.
of competent jurisdiction; or (c) where the dismissal is premised on payment by the
defendant of the claim involved.
DISPOSITIVE:
- Sps. Beltran’s counterarguments, manifested in their Memorandum:
WHEREFORE, the petition is GRANTED. The assailed Resolutions dated May 28, 2002 and December 5,
o RTC is correct in dismissing the case with prejudice based on their MTD because they
2002 of the Regional Trial Court, Branch 34, Negros Oriental are AFFIRMED with MODIFICATION such that
filed their motion on January 10, 2002, ahead of Dael who filed his Notice of
the case is dismissed without prejudice. No pronouncement as to costs.
Dismissal only on February 20, 2002
o Dael filed the Notice of Dismissal only as an afterthought after he realized that the
Motion to Dismiss was meritorious.
#132 Malayan Insurance v Ipil Int’l • Sec 3, R17 ROC and Sec3, R17 RCP contemplates certain instances where the complaint may be
GR NO. 141860 dismissed due to the plaintiff's fault: (1) if he fails to appear during a scheduled trial, especially
August 30, 2006 on the date for the presentation of his evidence in chief; (2) if he fails to prosecute his action
Topic: Dismissal of Actions for an unreasonable length of time; (3) if he fails to comply with the rules or any order of the
Petitioners: Malayan Insurance Co., Inc., court; or (4) where the plaintiff fails to appear when so required at the pre-trial.
Respondents: Ipil International Inc., Anchor Orient Lines-Singapore, Med-Lines Philippines, Baltmed • The failure of a plaintiff to prosecute the action without any justifiable cause within a
Shipping Co., and Ocean Marine Mutual Protection & Indemnity Association, LTD., reasonable period of time will give rise to the presumption that he is no longer interested to
Ponente: Tinga, J obtain from the court the relief prayed for in his complaint; hence, the court is authorized to
order the dismissal of the complaint on its own motion or on motion of the defendants.
o The presumption is not, by any means, conclusive because the plaintiff, on a motion
FACTS:
for reconsideration of the order of dismissal, may allege and establish a justifiable
• Malayan filed before RTC, a complaint for civil damages against respondents Anchor Orient
cause for such failure.
Lines-Singapore (Anchor), a foreign corporation, and its agent, Ipil International, Inc. (Ipil).
• Petitioner cannot be concluded that it failed to prosecute the case for an unreasonable length
• Ipil and Anchor then filed their Answer on 27 March 1995. Having received a copy of the Answer
of time for no justifiable cause. The dismissal of the Civil case on 7 February 1997 was mainly
on 4 April 1995, Malayan filed a motion to have the pre-trial set by the trial court.
attributed to Malayan’s failure to have the case set for pre-trial anew for eight months since
• The pre-trial did not push through hence it was reset but on that date, Ipil, Anchor and their the last order of the trial court. At that time too, the duty to have the case set for pre-trial
counsels failed to appear. As a consequence, they were declared as in default and Malayan was devolved on the Clerk of Court, according to Section 5, Rule 20 of the Revised Rules of Court.
allowed to present evidence ex parte.
• Malayan’s failure to have the case set for pre-trial is attended by justifiable cause. There is
• Trial court lifted the order of default and set the pretrial but was again re-scheduled upon the reason to believe that Malayan awaited the further orders of the trial court which explains its
Joint Motion to Reset Pre-trial filed by Malayan, Ipil and Anchor. failure to have the case set for pretrial. The span of time involved is not unreasonably that long
• Malayan filed a Motion for Leave to File Amended Complaint which the trial court admitted. to give rise to the inference that Malayan has lost interest in the case.
The Amended Complaint impleaded additional defendants namely, Baltmed, Med-Lines, P&I • Malayan, in the case at bar did not fail to perform an order of the trial court. There was no
Club and Pandiman. In view of this, court reset the pre-trial until further notice. apparent pattern to delay the case, the period involved is much too short for one to conclude
• Summons were duly served upon the newly-impleaded defendants, Pandiman filed a Motion its disinterest in pursuing the case, and the civil case involved an action for damages, an
to Dismiss. Med-lines, on the other hand, had been granted two extensions before finally filing ordinary action which is much less urgent than a special civil action or a provisional remedy.
its Answer with Compulsory Counterclaim. • Malayan evinced earnestness in prosecuting the civil case by filing a motion to set it for pre-
• Upon hearing of MTD by Pandiman : TC ruled ordered Pandiman to be dropped as party- trial, appearing on the date of the pre-trial on 26 July 1995 and duly filing its Comment to
defendant. (June 7, 1996) Pandiman’s Motion to Dismiss.
• TC issued an Order dismissing the Civil case for failure to prosecute for an unreasonable length • It must be stressed that even if the plaintiff fails to promptly move for pre-trial without any
of time pursuant to Section 3, Rule 17. Malayan filed a motion for reconsideration, court justifiable cause for such delay, the extreme sanction of dismissal of the complaint might not
likewise denied. (Feb 7, 1997) be warranted if no substantial prejudice would be caused to the defendant, and there are
• The last order of the court is dated June 7, 1996. After said special and compelling reasons which would make the strict application of the rule clearly
order, the case was ready for pre-trial. It is admitted by the unjustified.
plaintiff that it should have moved for pre-trial. However, it
failed to do so. The plaintiff claims that its failure was due to DISPOSITION:
inadvertence (change of counsel’s address)- unmeritorious.
• Malayan filed an appeal with CA but CA denied the appeal, holding that the question of what WHEREFORE, the instant petition is GRANTED. The Decision dated 6 October 1999 of the Court of Appeals
constitutes an unreasonable length of time to prosecute a case depends upon the and its Resolution dated 2 February 2000 in C.A.-G.R. CV No. 56922 are REVERSED. The Regional Trial Court
circumstances of each case and is a matter best left to the sound discretion of the trial court of Manila, Branch 1, is DIRECTED to try and decide Civil Case No. 95-72660 with deliberate dispatch.
(Montejo v Urutia) and if the clerk in the instant case had been negligent, it was Malayan’s duty
to call the trial court’s attention.
• Malayan asserts that the CA’s reliance on Montejo v. Urutia is misplaced as the facts in the cited
case are different from those in the case at bar. Malayan points out that the cause for the
dismissal of the case in Montejo was therein plaintiff’s failure to comply, for a period of more
than two years.
• Ipil and Medlines filed their comments, Malayan filed a reply. In a Resolution, the Court noted
that Anchor, Baltmed and P&I Club are not registered with SEC and have no resident agents in
the Philippines. Thus, SC dispensed with their respective Comments and resolved the case on
the basis of the pleadings at hand.

ISSUE(s):
W/N Malayan failed to prosecute for an unreasonable time with no justifiable cause

HELD:
133. RN Dev. V. A.I.I. respondent and counsel did not appear, which prompted the Court to reset the pre-
G.R. 166104 trial for the last time to September 18, 2001, with a warning that should the
June 26, 2008 respondent and counsel not appear on the next setting, the Court will dismiss the
Topic: DISMISSAL OF ACTIONS case for lack of interest.
Petitioners: RN DEVELOPMENT CORPORATION
Respondents: A.I.I. SYSTEM, INC - September 18, 2001 –
Ponente: J. Leonardo-De Castro counsel for the respondent moved for a resetting since the new counsel had not yet
studied the proposals for settlement made by the petitioner.
Doctrine: While a court can dismiss a case on the ground of non prosequitur, the real test of
- November 27, 2001 –
such power is whether, under the circumstances, plaintiff is chargeable with want of due
there was again no appearance for the respondent and its counsel; Pre-trial
diligence in failing to proceed with reasonable promptitude. In the absence of a pattern or a
proceeded and court dismissed respondent’s complaint for its failure to appear for
scheme to delay the disposition of the case or a wanton failure to observe the mandatory
pre-trial and for lack of interest.
requirement of the rules on the part of the plaintiff, as in the case at bar, courts should decide
to dispense rather than wield their authority to dismiss.
Indeed, the dismissal of a case whether for failure to appear during trial or prosecute an action • Respondent filed for MR which states that counsel of respondent was only lat by 4
for an unreasonable length of time rests on the sound discretion of the trial court. But this minutes. The pre-trial was scheduled to start at 8:30 a.m. but the counsel only
arrived at 8:34 a.m.
discretion must not be abused, nay gravely abused, and must be exercised soundly. Deferment
of proceedings may be tolerated so that cases may be adjudged only after a full and free
presentation of all the evidence by both parties. The propriety of dismissing a case must be • The RTC denied the MR in an order stating that “the Court had been very lenient to
determined by the circumstances surrounding each particular case. There must be sufficient the [respondent] when it allowed the resetting of the pre-trial for five times. In fact,
reason to justify the dismissal of a complaint. the Court set the pre-trial "for the last time" twice.”

FACTS: • The counsel for respondent sought to CA the reconsideration of the dismissal of the
case on the ground that he was only four (4) minutes late. He explained why he came
• Cea obtained a loan from Villanueva where it was secured by a REM covering Cea’s parcels late for pre-trial but nonetheless apologized to the court for his tardiness which was
of lands not intentional.

• AII Systems, Inc. (Respondent) filed a Complaint for Sum of Money with RTC against RN • CA reversed and set aside the RTC’s Order and remanded the case to
Development Corporation (petitioner), seeking to collect the outstanding balance of the RTC for further proceedings.
purchase price of the pipes and fittings, valves and electrical panels. Petitioner later filed
its Answer. • Petitioner filed MR – which CA denied. Hence this petition

• Respondent filed an Ex Parte Motion to Set Case for Pre-Trial which was granted by court • Petitioner’s Contention: CA committed a reversible error when it
scheduling the case for pre-trial on Feb 6 2001. inferred that the trial court had been unduly strict in applying the rules of procedure
and that it entirely had no reason to dismiss the complaint.
The pre-trial in this case was reset for five times:
ISSUE : W/N the CA erred in reversing the decision of the RTC. (NO)
- February 6, 2001 -
parties’ counsel manifested their intention to settle
the case, thus, pre-trial was reset to 24 April 2001. HELD/RATIO

- April 24, 2001 - While petitioner now raises a factual issue as to whether or not the counsel for respondent
only petitioner’s counsel appeared. He manifested that there are negotiations for the actually arrived in court four (4) minutes late on November 27, 2001, there is nothing on record
settlement of the case and moved for the resetting of the pretrial. Pre-trial was to show that the allegation of the counsel for respondent on this factual matter was disputed
rescheduled to 07 Aug 2001. before the trial court. Hence, the CA did not err when it found that the respondent only failed
to arrive on time for the pre-trial, instead of finding that there was failure to appear and lack
- August 7, 2001 – of interest on the part of the respondent.
The CA properly applied the ruling in Africa vs. Intermediate Appellate Court, which set aside
the order of default issued by the trial court due to the ten-minute delay of petitioner's
counsel. The ruling states that:

For an innocuous delay of ten minutes, petitioner was ultimately denied due process of law
which could have, had respondent judge been in a less hurry to clear his docket, enable him to
present his defenses . . .

While it is desirable that the Rules of Court be faithfully observed, courts should not be
obsessively strict over the occasional lapses of litigants. Given a good reason, the trial court
should set aside its order of default, constantly bearing in mind that it is the exception and not
the rule of the day. A default order must be resorted to only in clear cases of obstinate refusal
or inordinate neglect to comply with the orders of the court.

Further, in BPI vs CA, the Court cautioned courts against the improvident dismissal of cases for
failure to prosecute, thus:

. . . . In Marahay v. Melicor, we said —

While a court can dismiss a case on the ground of non prosequitur, the real test of such power
is whether, under the circumstances, plaintiff is chargeable with want of due diligence in
failing to proceed with reasonable promptitude. In the absence of a pattern or a scheme to
delay the disposition of the case or a wanton failure to observe the mandatory requirement
of the rules on the part of the plaintiff, as in the case at bar, courts should decide to dispense
rather than wield their authority to dismiss.

Indeed, the dismissal of a case whether for failure to appear during trial or prosecute an
action for an unreasonable length of time rests on the sound discretion of the trial court. But
this discretion must not be abused, nay gravely abused, and must be exercised soundly.
Deferment of proceedings may be tolerated so that cases may be adjudged only after a full
and free presentation of all the evidence by both parties. The propriety of dismissing a case
must be determined by the circumstances surrounding each particular case. There must be
sufficient reason to justify the dismissal of a complaint.

Pre-trial is not a mere technicality in court proceeding for it is essential in the simplification
and the speedy disposition of disputes.

It is the policy of the Court to afford every litigant the amplest opportunity for the proper and
just determination of his cause, free from the constraints of technicalities. Since rules of
procedure are mere tools designed to facilitate the attainment of justice, courts must avoid
the rigid application thereof which tends to frustrate rather than promote the ends of justice.
Here, the counsel for respondent, upon receiving the order dismissing the complaint,
immediately filed a motion for reconsideration which adequately explained his late arrival for
four (4) minutes, which was not disputed before the trial court. Under the circumstances, the
latter should have granted respondent's motion for reconsideration of the dismissal of the
complaint.
134. Mendoza V. Paule RATIO
G.R. 175885 & G.R. 176271 The Supreme Court held that when a defendant has interposed a counterclaim (whether
February 13, 2009 compulsory or permissive) or is seeking affirmative relief by a cross-complaint, the plaintiff
Topic: Dismissal of Actions; Counter Claim / Cross Claim / Third Party Complaint; Rule 17(4) can’t dismiss the action so as to affect the right of the defendant in his counterclaim or prayer
Petitioners: Zenaida G. Mendoza & Manuel Dela Cruz for affirmative relief.
Respondents: Engr. Eduardo Paule, Engr. Alexander Coloma and National Irrigation
Administration The reason for that exception is clear. When the answer sets up an independent action
Ponente: J. Ynares-Santiago against the plaintiff, it then becomes an action by the defendant against the plaintiff, and,
of course, the plaintiff has no right to ask for a dismissal of the defendant’s action.
DOCTRINE: A dismissal of the cross claim can’t be surmised on the fact that the main case is
The present rule embodied in Sections 2 and 3 of Rule 17 of the 1997 Rules of Civil Procedure
also dismissed since such cross claim is different from that of the main case
ordains a more equitable disposition of the counterclaims by ensuring that any judgment
thereon is based on the merit of the counterclaim itself and not on the survival of the main
FACTS
complaint. Certainly, if the counterclaim is palpably without merit or suffers jurisdictional
- Engineer Paule is the proprietor of E.M. Paule Construction and Trading (EMPCT)
flaws, which stand independent of the complaint, the trial court is not precluded from
- Paule executed an SPA authorizing Mendoza to participate in the pre-qualification
dismissing it under the amended rules, provided that the judgment or order dismissing the
and bidding of a National Irrigation Administration (NIA) project, the Casicnan Multi-
counterclaim is premised on those defects. At the same time, if the counterclaim is justified,
Purpose Irrigation and Power Plant (CMIPPL)
the amended rules now unequivocally protect such counterclaim from peremptory dismissal
- Mendoza was given the power to bid and secure bonds with the NIA as well as
by reason of the dismissal of the complaint.
receive and collect payments. EMPCT, through Mendoza, was awarded the project
- When Cruz learned the Mendoza was in need of heavy equipment for use in the NIA
Notwithstanding the immutable character of Paule’s liability to Mendoza, however, the exact
project, he met up with him to discuss an agreement for such project
amount thereof is yet to be determined by the trial court, after receiving evidence for and in
- The product of their agreement was two job orders for dump trucks on December of
behalf of Mendoza on her counterclaim, which must be considered pending and unresolved.
1999
- On April 2000, Paule revoked the SPA of Mendoza prompting NIA to refuse payment
DISPOSITIVE PORTION
on her billings
WHEREFORE, the petitions are GRANTED. The August 28, 2006 Decision of the Court of Appeals
- Cruz, therefore, could not be paid for the rent of the equipment. Upon advice of
in CA-G.R. CV No. 80819 dismissing the complaint in Civil Case No. 18-SD (2000) and its
Mendoza, Cruz addressed his demands for payment of lease rentals directly to NIA
December 11, 2006 Resolution denying the motion for reconsideration are REVERSED and SET
but the latter refused to acknowledge the same and informed Cruz that it would be
ASIDE. The August 7, 2003 Decision of the Regional Trial Court of Nueva Ecija, Branch 37 in Civil
remitting payment only to EMPCT as the winning contractor for the project
Case No. 18-SD (2000) finding PAULE liable is REINSTATED, with the MODIFICATION that the
- Cruz then sued Paule (EMPTC) and NIA
trial court is ORDERED to receive evidence on the counterclaim of petitioner Zenaida G.
- Paule filed a cross claim against Mendoza.
Mendoza.
- Mendoza alleged in her cross-claim that because of Paule’s whimsical revocation of
the SPA, she was barred from collecting payments from NIA, thus resulting in her
inability to fund her checks, which she had issued to suppliers of materials,
equipment and labor for the project.
- RTC ruled that Paule is liable to Cruz but was unable to hear the cross claim of
Mendoza against Paule (Mendoza was not granted the petition to present evidence
ex-parte)
- CA held that since the RTC has already dismissed the case between Paule and Cruz,
such cross claim is already deemed resolved

ISSUE
Whether the lower courts correctly ruled in dismissing Mendoza’s case since it was merely an
auxiliary to the main case between Cruz and Paule

HELD
No!