CIVIL PROCEDURE V- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack

V- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess of jurisdiction
INTRODUCTION in issuing the Writ of Injunction because petitioner City of Manila and its constituents would result to greater damage and
prejudice thereof. (sic)8
Republic of the Philippines Without first resolving the above issues, this Court finds that the instant petition should be denied for being moot and academic.
SUPREME COURT Upon perusal of the original records of the instant case, this Court discovered that a Decision9 in the main case had already been rendered
Manila by the RTC on August 13, 2007, the dispositive portion of which reads as follows:
EN BANC WHEREFORE, in view of the foregoing, this Court hereby renders JUDGMENT in favor of the plaintiff and against the defendant to grant a
G.R. No. 175723 February 4, 2014 tax refund or credit for taxes paid pursuant to Section 21 of the Revenue Code of the City of Manila as amended for the year 2002 in the
THE CITY OF MANILA, represented by MAYOR JOSE L. ATIENZA, JR., and MS. LIBERTY M. TOLEDO, in her capacity as the City Treasurer following amounts:
of Manila, Petitioners,
To plaintiff SM Mart, Inc. - P 11,462,525.02
vs.
HON. CARIDAD H. GRECIA-CUERDO, in her capacity as Presiding Judge of the Regional Trial Court, Branch 112, Pasay City; SM MART,
To plaintiff SM Prime Holdings, Inc. - 3,118,104.63
INC.; SM PRIME HOLDINGS, INC.; STAR APPLIANCES CENTER; SUPERVALUE, INC.; ACE HARDWARE PHILIPPINES, INC.; WATSON
PERSONAL CARE STORES, PHILS., INC.; JOLLIMART PHILS., CORP.; SURPLUS MARKETING CORPORATION and SIGNATURE To plaintiff Star Appliances Center - 2,152,316.54
LINES, Respondents.
DECISION To plaintiff Supervalue, Inc. - 1,362,750.34
PERALTA, J.:
Before the Court is a special civil action for certiorari under Rule 65 of the Rules of Court seeking to reverse and set aside the To plaintiff Ace Hardware Phils., Inc. - 419,689.04
Resolutions1 dated April 6, 2006 and November 29, 2006 of the Court of Appeals (CA) in CA-G.R. SP No. 87948.
The antecedents of the case, as summarized by the CA, are as follows: To plaintiff Watsons Personal Care Health - 231,453.62
The record shows that petitioner City of Manila, through its treasurer, petitioner Liberty Toledo, assessed taxes for the taxable period
from January to December 2002 against private respondents SM Mart, Inc., SM Prime Holdings, Inc., Star Appliances Center, Supervalue, Stores Phils., Inc.
Inc., Ace Hardware Philippines, Inc., Watsons Personal Care Stores Phils., Inc., Jollimart Philippines Corp., Surplus Marketing Corp. and
Signature Lines. In addition to the taxes purportedly due from private respondents pursuant to Section 14, 15, 16, 17 of the Revised To plaintiff Jollimart Phils., Corp. - 140,908.54
Revenue Code of Manila (RRCM), said assessment covered the local business taxes petitioners were authorized to collect under Section 21
of the same Code. Because payment of the taxes assessed was a precondition for the issuance of their business permits, private To plaintiff Surplus Marketing Corp. - 220,204.70
respondents were constrained to pay the ₱19,316,458.77 assessment under protest.
On January 24, 2004, private respondents filed [with the Regional Trial Court of Pasay City] the complaint denominated as one for "Refund To plaintiff Signature Mktg. Corp. - 94,906.34
or Recovery of Illegally and/or Erroneously-Collected Local Business Tax, Prohibition with Prayer to Issue TRO and Writ of Preliminary
Injunction" TOTAL: - P 19,316,458.77
which was docketed as Civil Case No. 04-0019-CFM before public respondent's sala [at Branch 112]. In the amended complaint they filed Defendants are further enjoined from collecting taxes under Section 21, Revenue Code of Manila from herein plaintiff.
on February 16, 2004, private respondents alleged that, in relation to Section 21 thereof, Sections 14, 15, 16, 17, 18, 19 and 20 of the SO ORDERED.10
RRCM were violative of the limitations and guidelines under Section 143 (h) of Republic Act. No. 7160 [Local Government Code] on double The parties did not inform the Court but based on the records, the above Decision had already become final and executory per the
taxation. They further averred that petitioner city's Ordinance No. 8011 which amended pertinent portions of the RRCM had already been Certificate of Finality11 issued by the same trial court on October 20, 2008. In fact, a Writ of Execution12 was issued by the RTC on
declared to be illegal and unconstitutional by the Department of Justice.2 November 25, 2009. In view of the foregoing, it clearly appears that the issues raised in the present petition, which merely involve the
In its Order3 dated July 9, 2004, the RTC granted private respondents' application for a writ of preliminary injunction. incident on the preliminary injunction issued by the RTC, have already become moot and academic considering that the trial court, in its
Petitioners filed a Motion for Reconsideration4 but the RTC denied it in its Order5 dated October 15, 2004. decision on the merits in the main case, has already ruled in favor of respondents and that the same decision is now final and executory.
Petitioners then filed a special civil action for certiorari with the CA assailing the July 9, 2004 and October 15, 2004 Orders of the RTC.6 Well entrenched is the rule that where the issues have become moot and academic, there is no justiciable controversy, thereby rendering
In its Resolution promulgated on April 6, 2006, the CA dismissed petitioners' petition for certiorari holding that it has no jurisdiction over the resolution of the same of no practical use or value.13
the said petition. The CA ruled that since appellate jurisdiction over private respondents' complaint for tax refund, which was filed with In any case, the Court finds it necessary to resolve the issue on jurisdiction raised by petitioners owing to its significance and for future
the RTC, is vested in the Court of Tax Appeals (CTA), pursuant to its expanded jurisdiction under Republic Act No. 9282 (RA 9282), it guidance of both bench and bar. It is a settled principle that courts will decide a question otherwise moot and academic if it is capable of
follows that a petition for certiorari seeking nullification of an interlocutory order issued in the said case should, likewise, be filed with the repetition, yet evading review.14
CTA. However, before proceeding, to resolve the question on jurisdiction, the Court deems it proper to likewise address a procedural error
Petitioners filed a Motion for Reconsideration,7 but the CA denied it in its Resolution dated November 29, 2006. which petitioners committed.
Hence, the present petition raising the following issues: Petitioners availed of the wrong remedy when they filed the instant special civil action for certiorari under Rule 65 of the Rules of Court in
I- Whether or not the Honorable Court of Appeals gravely erred in dismissing the case for lack of jurisdiction. assailing the Resolutions of the CA which dismissed their petition filed with the said court and their motion for reconsideration of such
II- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess of jurisdiction dismissal. There is no dispute that the assailed Resolutions of the CA are in the nature of a final order as they disposed of the petition
in enjoining by issuing a Writ of Injunction the petitioners, their agents and/or authorized representatives from implementing completely. It is settled that in cases where an assailed judgment or order is considered final, the remedy of the aggrieved party is appeal.
Section 21 of the Revised Revenue Code of Manila, as amended, against private respondents. Hence, in the instant case, petitioner should have filed a petition for review on certiorari under Rule 45, which is a continuation of the
III- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess of jurisdiction appellate process over the original case.15
in issuing the Writ of Injunction despite failure of private respondents to make a written claim for tax credit or refund with the Petitioners should be reminded of the equally-settled rule that a special civil action for certiorari under Rule 65 is an original or
City Treasurer of Manila. independent action based on grave abuse of discretion amounting to lack or excess of jurisdiction and it will lie only if there is no appeal
IV- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess of jurisdiction or any other plain, speedy, and adequate remedy in the ordinary course of law.16 As such, it cannot be a substitute for a lost appeal.17
considering that under Section 21 of the Manila Revenue Code, as amended, they are mere collecting agents of the City Nonetheless, in accordance with the liberal spirit pervading the Rules of Court and in the interest of substantial justice, this Court has,
Government. before, treated a petition for certiorari as a petition for review on certiorari, particularly (1) if the petition for certiorari was filed within
the reglementary period within which to file a petition for review on certiorari; (2) when errors of judgment are averred; and (3) when
there is sufficient reason to justify the relaxation of the rules.18 Considering that the present petition was filed within the 15-day
reglementary period for filing a petition for review on certiorari under Rule 45, that an error of judgment is averred, and because of the
significance of the issue on jurisdiction, the Court deems it proper and justified to relax the rules and, thus, treat the instant petition for
certiorari as a petition for review on certiorari.
Having disposed of the procedural aspect, we now turn to the central issue in this case. The basic question posed before this Court is
whether or not the CTA has jurisdiction over a special civil action for certiorari assailing an interlocutory order issued by the RTC in a local
tax case.
This Court rules in the affirmative.
On June 16, 1954, Congress enacted Republic Act No. 1125 (RA 1125) creating the CTA and giving to the said court jurisdiction over the
following:
(1) Decisions of the Collector of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes,
fees or other charges, penalties imposed in relation thereto, or other matters arising under the National Internal Revenue Code
or other law or part of law administered by the Bureau of Internal Revenue;
(2) Decisions of the Commissioner of Customs in cases involving liability for customs duties, fees or other money charges;
seizure, detention or release of property affected fines, forfeitures or other penalties imposed in relation thereto; or other
matters arising under the Customs Law or other law or part of law administered by the Bureau of Customs; and
(3) Decisions of provincial or City Boards of Assessment Appeals in cases involving the assessment and taxation of real property
or other matters arising under the Assessment Law, including rules and regulations relative thereto.
On March 30, 2004, the Legislature passed into law Republic Act No. 9282 (RA 9282) amending RA 1125 by expanding the jurisdiction of
the CTA, enlarging its membership and elevating its rank to the level of a collegiate court with special jurisdiction. Pertinent portions of
the amendatory act provides thus:
Sec. 7. Jurisdiction. - The CTA shall exercise:
a. Exclusive appellate jurisdiction to review by appeal, as herein provided:
1. Decisions of the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal
revenue taxes, fees or other charges, penalties in relation thereto, or other matters arising under the National
Internal Revenue or other laws administered by the Bureau of Internal Revenue;
2. Inaction by the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal
revenue taxes, fees or other charges, penalties in relations thereto, or other matters arising under the National
Internal Revenue Code or other laws administered by the Bureau of Internal Revenue, where the National Internal
Revenue Code provides a specific period of action, in which case the inaction shall be deemed a denial;
3. Decisions, orders or resolutions of the Regional Trial Courts in local tax cases originally decided or resolved by
them in the exercise of their original or appellate jurisdiction;
4. Decisions of the Commissioner of Customs in cases involving liability for customs duties, fees or other money
charges, seizure, detention or release of property affected, fines, forfeitures or other penalties in relation thereto,
or other matters arising under the Customs Law or other laws administered by the Bureau of Customs;
5. Decisions of the Central Board of Assessment Appeals in the exercise of its appellate jurisdiction over cases
involving the assessment and taxation of real property originally decided by the provincial or city board of
assessment appeals;
6. Decisions of the Secretary of Finance on customs cases elevated to him automatically for review from decisions of
the Commissioner of Customs which are adverse to the Government under Section 2315 of the Tariff and Customs
Code;
7. Decisions of the Secretary of Trade and Industry, in the case of nonagricultural product, commodity or article, and
the Secretary of Agriculture in the case of agricultural product, commodity or article, involving dumping and
countervailing duties under Section 301 and 302, respectively, of the Tariff and Customs Code, and safeguard
measures under Republic Act No. 8800, where either party may appeal the decision to impose or not to impose said
duties.
b. Jurisdiction over cases involving criminal offenses as herein provided:
1. Exclusive original jurisdiction over all criminal offenses arising from violations of the National Internal Revenue
Code or Tariff and Customs Code and other laws administered by the Bureau of Internal Revenue or the Bureau of
Customs: Provided, however, That offenses or felonies mentioned in this paragraph where the principal amount of
taxes and fees, exclusive of charges and penalties, claimed is less than One million pesos (₱1,000,000.00) or where
there is no specified amount claimed shall be tried by the regular Courts and the jurisdiction of the CTA shall be
appellate. Any provision of law or the Rules of Court to the contrary notwithstanding, the criminal action and the
corresponding civil action for the recovery of civil liability for taxes and penalties shall at all times be simultaneously
instituted with, and jointly determined in the same proceeding by the CTA, the filing of the criminal action being
deemed to necessarily carry with it the filing of the civil action, and no right to reserve the filing of such civil action
separately from the criminal action will be recognized.
2. Exclusive appellate jurisdiction in criminal offenses:
a. Over appeals from the judgments, resolutions or orders of the Regional Trial Courts in tax cases originally decided by them, in their
respected territorial jurisdiction.
b. Over petitions for review of the judgments, resolutions or orders of the Regional Trial Courts in the exercise of their appellate
jurisdiction over tax cases originally decided by the Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial Courts in
their respective jurisdiction.
c. Jurisdiction over tax collection cases as herein provided:
1. Exclusive original jurisdiction in tax collection cases involving final and executory assessments for taxes, fees,
charges and penalties: Provides, however, that collection cases where the principal amount of taxes and fees,
exclusive of charges and penalties, claimed is less than One million pesos (₱1,000,000.00) shall be tried by the
proper Municipal Trial Court, Metropolitan Trial Court and Regional Trial Court.
2. Exclusive appellate jurisdiction in tax collection cases:
a. Over appeals from the judgments, resolutions or orders of the Regional Trial Courts in tax collection cases originally decided by them, in
their respective territorial jurisdiction.
b. Over petitions for review of the judgments, resolutions or orders of the Regional Trial Courts in the Exercise of their appellate
jurisdiction over tax collection cases originally decided by the Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial
Courts, in their respective jurisdiction.19
A perusal of the above provisions would show that, while it is clearly stated that the CTA has exclusive appellate jurisdiction over
decisions, orders or resolutions of the RTCs in local tax cases originally decided or resolved by them in the exercise of their original or
appellate jurisdiction, there is no categorical statement under RA 1125 as well as the amendatory RA 9282, which provides that th e CTA
has jurisdiction over petitions for certiorari assailing interlocutory orders issued by the RTC in local tax cases filed before it.
The prevailing doctrine is that the authority to issue writs of certiorari involves the exercise of original jurisdiction which must be expressly
conferred by the Constitution or by law and cannot be implied from the mere existence of appellate jurisdiction.20 Thus, in the cases of
Pimentel v. COMELEC,21 Garcia v. De Jesus,22 Veloria v. COMELEC,23Department of Agrarian Reform Adjudication Board v. Lubrica,24 and
Garcia v. Sandiganbayan,25 this Court has ruled against the jurisdiction of courts or tribunals over petitions for certiorari on the ground
that there is no law which expressly gives these tribunals such power.26 It must be observed, however, that with the exception of Garcia v.
Sandiganbayan,27 these rulings pertain not to regular courts but to tribunals exercising quasi-judicial powers. With respect to the
Sandiganbayan, Republic Act No. 824928 now provides that the special criminal court has exclusive original jurisdiction over petitions for
the issuance of the writs of mandamus, prohibition, certiorari, habeas corpus, injunctions, and other ancillary writs and processes in aid of
its appellate jurisdiction.
In the same manner, Section 5 (1), Article VIII of the 1987 Constitution grants power to the Supreme Court, in the exercise of its original
jurisdiction, to issue writs of certiorari, prohibition and mandamus. With respect to the Court of Appeals, Section 9 (1) of Batas Pambansa
Blg. 129 (BP 129) gives the appellate court, also in the exercise of its original jurisdiction, the power to issue, among others, a writ of
certiorari,whether or not in aid of its appellate jurisdiction. As to Regional Trial Courts, the power to issue a writ of certiorari, in the
exercise of their original jurisdiction, is provided under Section 21 of BP 129.
The foregoing notwithstanding, while there is no express grant of such power, with respect to the CTA, Section 1, Article VIII of the 1987
Constitution provides, nonetheless, that judicial power shall be vested in one Supreme Court and in such lower courts as may be
established by law and that judicial power includes the duty of the courts of justice to settle actual controversies involving rights which
are legally demandable and enforceable, and to determine whether or not there has been a grave abuse of discretion amounting to lack
or excess of jurisdiction on the part of any branch or instrumentality of the Government.
On the strength of the above constitutional provisions, it can be fairly interpreted that the power of the CTA includes that of determining
whether or not there has been grave abuse of discretion amounting to lack or excess of jurisdiction on the part of the RTC in issuing an
interlocutory order in cases falling within the exclusive appellate jurisdiction of the tax court. It, thus, follows that the CTA, by
constitutional mandate, is vested with jurisdiction to issue writs of certiorari in these cases.
Indeed, in order for any appellate court to effectively exercise its appellate jurisdiction, it must have the authority to issue, among others,
a writ of certiorari. In transferring exclusive jurisdiction over appealed tax cases to the CTA, it can reasonably be assumed that the law
intended to transfer also such power as is deemed necessary, if not indispensable, in aid of such appellate jurisdiction. There is no
perceivable reason why the transfer should only be considered as partial, not total.
Consistent with the above pronouncement, this Court has held as early as the case of J.M. Tuason & Co., Inc. v. Jaramillo, et al. 29 that "if a
case may be appealed to a particular court or judicial tribunal or body, then said court or judicial tribunal or body has jurisdiction to issue
the extraordinary writ of certiorari, in aid of its appellate jurisdiction." 30 This principle was affirmed in De Jesus v. Court of
Appeals,31 where the Court stated that "a court may issue a writ of certiorari in aid of its appellate jurisdiction if said court has jurisdiction
to review, by appeal or writ of error, the final orders or decisions of the lower court." 32 The rulings in J.M. Tuason and De Jesus were
reiterated in the more recent cases of Galang, Jr. v. Geronimo33 and Bulilis v. Nuez.34
Furthermore, Section 6, Rule 135 of the present Rules of Court provides that when by law, jurisdiction is conferred on a court or judicial
officer, all auxiliary writs, processes and other means necessary to carry it into effect may be employed by such court or officer.
If this Court were to sustain petitioners' contention that jurisdiction over their certiorari petition lies with the CA, this Court would be
confirming the exercise by two judicial bodies, the CA and the CTA, of jurisdiction over basically the same subject matter – precisely the
split-jurisdiction situation which is anathema to the orderly administration of justice. 35 The Court cannot accept that such was the
legislative motive, especially considering that the law expressly confers on the CTA, the tribunal with the specialized competence over tax
and tariff matters, the role of judicial review over local tax cases without mention of any other court that may exercise such power. Thus,
the Court agrees with the ruling of the CA that since appellate jurisdiction over private respondents' complaint for tax refund is vested in
the CTA, it follows that a petition for certiorari seeking nullification of an interlocutory order issued in the said case should, likewise, be
filed with the same court. To rule otherwise would lead to an absurd situation where one court decides an appeal in the main case while
another court rules on an incident in the very same case.
Stated differently, it would be somewhat incongruent with the pronounced judicial abhorrence to split jurisdiction to conclude that the
intention of the law is to divide the authority over a local tax case filed with the RTC by giving to the CA or this Court jurisdiction to issue a
writ of certiorari against interlocutory orders of the RTC but giving to the CTA the jurisdiction over the appeal from the decision of the trial
court in the same case. It is more in consonance with logic and legal soundness to conclude that the grant of appellate jurisdiction to the
CTA over tax cases filed in and decided by the RTC carries with it the power to issue a writ of certiorari when necessary in aid of such
appellate jurisdiction. The supervisory power or jurisdiction of the CTA to issue a writ of certiorari in aid of its appellate jurisdiction should
co-exist with, and be a complement to, its appellate jurisdiction to review, by appeal, the final orders and decisions of the RTC, in order to
have complete supervision over the acts of the latter.36
A grant of appellate jurisdiction implies that there is included in it the power necessary to exercise it effectively, to make all orders that
will preserve the subject of the action, and to give effect to the final determination of the appeal. It carries with it the power to protect
that jurisdiction and to make the decisions of the court thereunder effective. The court, in aid of its appellate jurisdiction, has authority to
control all auxiliary and incidental matters necessary to the efficient and proper exercise of that jurisdiction.1âwphi1 For this purpose, it
may, when necessary, prohibit or restrain the performance of any act which might interfere with the proper exercise of its rightful
jurisdiction in cases pending before it.37
Lastly, it would not be amiss to point out that a court which is endowed with a particular jurisdiction should have powers which are
necessary to enable it to act effectively within such jurisdiction. These should be regarded as powers which are inherent in its jurisdiction
and the court must possess them in order to enforce its rules of practice and to suppress any abuses of its process and to defeat any
attempted thwarting of such process.
In this regard, Section 1 of RA 9282 states that the CTA shall be of the same level as the CA and shall possess all the inherent powers of a
court of justice.
Indeed, courts possess certain inherent powers which may be said to be implied from a general grant of jurisdiction, in addition to those
expressly conferred on them. These inherent powers are such powers as are necessary for the ordinary and efficient exercise of
jurisdiction; or are essential to the existence, dignity and functions of the courts, as well as to the due administration of justice; or are
directly appropriate, convenient and suitable to the execution of their granted powers; and include the power to maintain the court's
jurisdiction and render it effective in behalf of the litigants.38
Thus, this Court has held that "while a court may be expressly granted the incidental powers necessary to effectuate its jurisdiction, a
grant of jurisdiction, in the absence of prohibitive legislation, implies the necessary and usual incidental powers essential to effectuate it,
and, subject to existing laws and constitutional provisions, every regularly constituted court has power to do all things that are reasonably
necessary for the administration of justice within the scope of its jurisdiction and for the enforcement of its judgments and
mandates."39 Hence, demands, matters or questions ancillary or incidental to, or growing out of, the main action, and coming within the
above principles, may be taken cognizance of by the court and determined, since such jurisdiction is in aid of its authority over the
principal matter, even though the court may thus be called on to consider and decide matters which, as original causes of action, would
not be within its cognizance.40
Based on the foregoing disquisitions, it can be reasonably concluded that the authority of the CTA to take cognizance of petitions for
certiorari questioning interlocutory orders issued by the RTC in a local tax case is included in the powers granted by the Constitution as
well as inherent in the exercise of its appellate jurisdiction.
Finally, it would bear to point out that this Court is not abandoning the rule that, insofar as quasi-judicial tribunals are concerned, the
authority to issue writs of certiorari must still be expressly conferred by the Constitution or by law and cannot be implied from the mere
existence of their appellate jurisdiction. This doctrine remains as it applies only to quasi-judicial bodies.
WHEREFORE, the petition is DENIED.
SO ORDERED.
DIOSDADO M. PERALTA
Associate Justice
WE CONCUR:
MARIA LOURDES P. A. SERENO
Chief Justice
G.R. No. 181416 November 11, 2013
MEDICAL PLAZA MAKATI CONDOMINIUM CORPORATION, Petitioner,
vs.
ROBERT H. CULLEN, Respondent.
DECISION
PERALTA, J.:
This is a petition for review on certiorari under Rule 45 of the Rules of Court assailing the Court of Appeals (CA) Decision1 dated July 10,
2007 and Resolution2 dated January 25, 2008 in CA-G.R. CV No. 86614. The assailed decision reversed and set aside the September 9,
2005 Order3 of the Regional Trial Court (RTC) of Makati, Branch 58 in Civil Case No. 03-1018; while the assailed resolution denied the
separate motions for reconsideration filed by petitioner Medical Plaza Makati Condominium Corporation (MPMCC) and Meridien Land
Holding, Inc. (MLHI).
The factual and procedural antecedents are as follows:
Respondent Robert H. Cullen purchased from MLHI condominium Unit No. 1201 of the Medical Plaza Makati covered by Condominium
Certificate of Title No. 45808 of the Register of Deeds of Makati. Said title was later cancelled and Condominium Certificate of Title No.
64218 was issued in the name of respondent.
On September 19, 2002, petitioner, through its corporate secretary, Dr. Jose Giovanni E. Dimayuga, demanded from respondent payment
for alleged unpaid association dues and assessments amounting to ₱145,567.42. Respondent disputed this demand claiming that he had
been religiously paying his dues shown by the fact that he was previously elected president and director of petitioner.4 Petitioner, on the
other hand, claimed that respondent’s obligation was a carry-over of that of MLHI.5 Consequently, respondent was prevented from
exercising his right to vote and be voted for during the 2002 election of petitioner’s Board of Directors.6 Respondent thus clarified from
MLHI the veracity of petitioner’s claim, but MLHI allegedly claimed that the same had already been settled.7 This prompted respondent to
demand from petitioner an explanation why he was considered a delinquent payer despite the settlement of the obligation. Petitioner
failed to make such explanation. Hence, the Complaint for Damages8 filed by respondent against petitioner and MLHI, the pertinent
portions of which read:
xxxx
6. Thereafter, plaintiff occupied the said condominium unit no. 1201 and religiously paid all the corresponding monthly
contributions/association dues and other assessments imposed on the same. For the years 2000 and 2001, plaintiff served as
President and Director of the Medical Plaza Makati Condominium Corporation;
7. Nonetheless, on September 19, 2002, plaintiff was shocked/surprised to receive a letter from the incumbent Corporate
Secretary of the defendant Medical Plaza Makati, demanding payment of alleged unpaid association dues and assessments
arising from plaintiff’s condominium unit no. 1201. The said letter further stressed that plaintiff is considered a delinquent
member of the defendant Medical Plaza Makati.
x x x;
8. As a consequence, plaintiff was not allowed to file his certificate of candidacy as director. Being considered a delinquent,
plaintiff was also barred from exercising his right to vote in the election of new members of the Board of Directors x x x;
9. x x x Again, prior to the said election date, x x x counsel for the defendant [MPMCC] sent a demand letter to plaintiff, anent
the said delinquency, explaining that the said unpaid amount is a carry-over from the obligation of defendant Meridien. x x x;
10. Verification with the defendant [MPMCC] resulted to the issuance of a certification stating that Condominium Unit 1201
has an outstanding unpaid obligation in the total amount of ₱145,567.42 as of November 30, 2002, which again, was attributed
by defendant [MPMCC] to defendant Meridien. x x x;
11. Due to the seriousness of the matter, and the feeling that defendant Meridien made false representations considering that
it fully warranted to plaintiff that condominium unit 1201 is free and clear from all liens and encumbrances, the matter was
referred to counsel, who accordingly sent a letter to defendant Meridien, to demand for the payment of said unpaid
association dues and other assessments imposed on the condominium unit and being claimed by defendant [MPMCC]. x x x;
12. x x x defendant Meridien claimed however, that the obligation does not exist considering that the matter was already
settled and paid by defendant Meridien to defendant [MPMCC]. x x x;
13. Plaintiff thus caused to be sent a letter to defendant [MPMCC] x x x. The said letter x x x sought an explanation on the fact
that, as per the letter of defendant Meridien, the delinquency of unit 1201 was already fully paid and settled, contrary to the
claim of defendant [MPMCC]. x x x;
 14. Despite receipt of said letter on April 24, 2003, and to date however, no explanation was given by defendant [MPMCC], to
the damage and prejudice of plaintiff who is again obviously being barred from voting/participating in the election of members
of the board of directors for the year 2003;
15. Clearly, defendant [MPMCC] acted maliciously by insisting that plaintiff is a delinquent member when in fact, defendant
Meridien had already paid the said delinquency, if any. The branding of plaintiff as delinquent member was willfully and
deceitfully employed so as to prevent plaintiff from exercising his right to vote or be voted as director of the condominium
corporation; 16. Defendant [MPMCC]’s ominous silence when confronted with claim of payment made by defendant Meridien
is tantamount to admission that indeed, plaintiff is not really a delinquent member;
17. Accordingly, as a direct and proximate result of the said acts of defendant [MPMCC], plaintiff experienced/suffered from
mental anguish, moral shock, and serious anxiety. Plaintiff, being a doctor of medicine and respected in the community further
suffered from social humiliation and besmirched reputation thereby warranting the grant of moral damages in the amount of
₱500,000.00 and for which defendant [MPMCC] should be held liable;
18. By way of example or correction for the public good, and as a stern warning to all similarly situated, defendant [MPMCC]
should be ordered to pay plaintiff exemplary damages in the amount of ₱200,000.00;
19. As a consequence, and so as to protect his rights and interests, plaintiff was constrained to hire the services of counsel, for
an acceptance fee of ₱100,000.00 plus ₱2,500.00 per every court hearing attended by counsel;
20. In the event that the claim of defendant [MPMCC] turned out to be true, however, the herein defendant Meridien should
be held liable instead, by ordering the same to pay the said delinquency of condominium unit 1201 in the amount of
₱145,567.42 as of November 30, 2002 as well as the above damages, considering that the non-payment thereof would be the
proximate cause of the damages suffered by plaintiff;9
Petitioner and MLHI filed their separate motions to dismiss the complaint on the ground of lack of jurisdiction. 10MLHI claims that it is the
Housing and Land Use Regulatory Board (HLURB) which is vested with the exclusive jurisdiction to hear and decide the case. Petitioner, on
the other hand, raises the following specific grounds for the dismissal of the complaint: (1) estoppel as respondent himself approved the
assessment when he was the president; (2) lack of jurisdiction as the case involves an intra-corporate controversy; (3) prematurity for
failure of respondent to exhaust all intra-corporate remedies; and (4) the case is already moot and academic, the obligation having been
settled between petitioner and MLHI.11
On September 9, 2005, the RTC rendered a Decision granting petitioner’s and MLHI’s motions to dismiss and, consequently, dismissing
respondent’s complaint.
The trial court agreed with MLHI that the action for specific performance filed by respondent clearly falls within the exclusive jurisdiction
of the HLURB.12 As to petitioner, the court held that the complaint states no cause of action, considering that respondent’s obligation had
already been settled by MLHI. It, likewise, ruled that the issues raised are intra-corporate between the corporation and member.13
On appeal, the CA reversed and set aside the trial court’s decision and remanded the case to the RTC for further proceedings. Contrary to
the RTC conclusion, the CA held that the controversy is an ordinary civil action for damages which falls within the jurisdiction of regular
courts.14 It explained that the case hinged on petitioner’s refusal to confirm MLHI’s claim that the subject obligation had already been
settled as early as 1998 causing damage to respondent.15 Petitioner’s and MLHI’s motions for reconsideration had also been denied.16
Aggrieved, petitioner comes before the Court based on the following grounds:
I.
THE COURT A QUO HAS DECIDED A QUESTION OF SUBSTANCE, NOT THERETOFORE DETERMINED BY THE SUPREME COURT, OR HAS
DECIDED IT IN A WAY NOT IN ACCORD WITH LAW OR WITH THE APPLICABLE DECISIONS OF THE SUPREME COURT WHEN IT DECLARED THE
INSTANT CASE AN ORDINARY ACTION FOR DAMAGES INSTEAD OF AN INTRA-CORPORATE CONTROVERSY COGNIZABLE BY A SPECIAL
COMMERCIAL COURT.
II.
THE COURT A QUO HAS DECIDED THE INSTANT CASE IN A WAY NOT IN ACCORD WITH LAW OR WITH THE APPLICABLE DECISIONS OF THE
SUPREME COURT WHEN IT TOOK COGNIZANCE OF THE APPEAL WHILE RAISING ONLY PURE QUESTIONS OF LAW. 17
The petition is meritorious.
It is a settled rule that jurisdiction over the subject matter is determined by the allegations in the complaint. It is not affected by the pleas
or the theories set up by the defendant in an answer or a motion to dismiss. Otherwise, jurisdiction would become dependent almost
entirely upon the whims of the defendant.18 Also illuminating is the Court’s pronouncement in Go v. Distinction Properties Development
and Construction, Inc.:19
Basic as a hornbook principle is that jurisdiction over the subject matter of a case is conferred by law and determined by the allegations in
the complaint which comprise a concise statement of the ultimate facts constituting the plaintiff’s cause of action. The nature of an
action, as well as which court or body has jurisdiction over it, is determined based on the allegations contained in the complaint of the
plaintiff, irrespective of whether or not the plaintiff is entitled to recover upon all or some of the claims asserted therein. The averments
in the complaint and the character of the relief sought are the ones to be consulted. Once vested by the allegations in the complaint,
jurisdiction also remains vested irrespective of whether or not the plaintiff is entitled to recover upon all or some of the claims asserted
therein. x x x20
Based on the allegations made by respondent in his complaint, does the controversy involve intra-corporate issues as would fall within the
jurisdiction of the RTC sitting as a special commercial court or an ordinary action for damages within the jurisdiction of regular courts?
In determining whether a dispute constitutes an intra-corporate controversy, the Court uses two tests, namely, the relationship test and
the nature of the controversy test.21
An intra-corporate controversy is one which pertains to any of the following relationships: (1) between the corporation, partnership or
association and the public; (2) between the corporation, partnership or association and the State insofar as its franchise, permit or license
to operate is concerned; (3) between the corporation, partnership or association and its stockholders, partners, members or officers; and
(4) among the stockholders, partners or associates themselves.22 Thus, under the relationship test, the existence of any of the above intra-
corporate relations makes the case intra-corporate.23
Under the nature of the controversy test, "the controversy must not only be rooted in the existence of an intra-corporate relationship, but
must as well pertain to the enforcement of the parties’ correlative rights and obligations under the Corporation Code and the internal and
intra-corporate regulatory rules of the corporation."24 In other words, jurisdiction should be determined by considering both the
relationship of the parties as well as the nature of the question involved.25
Applying the two tests, we find and so hold that the case involves intra-corporate controversy. It obviously arose from the intra-corporate
relations between the parties, and the questions involved pertain to their rights and obligations under the Corporation Code and matters
relating to the regulation of the corporation.26
Admittedly, petitioner is a condominium corporation duly organized and existing under Philippine laws, charged with the management of
the Medical Plaza Makati. Respondent, on the other hand, is the registered owner of Unit No. 1201 and is thus a stockholder/member of
the condominium corporation. Clearly, there is an intra-corporate relationship between the corporation and a stockholder/member.
The nature of the action is determined by the body rather than the title of the complaint.1âwphi1 Though denominated as an action for
damages, an examination of the allegations made by respondent in his complaint shows that the case principally dwells on the propriety
of the assessment made by petitioner against respondent as well as the validity of petitioner’s act in preventing respondent from
participating in the election of the corporation’s Board of Directors. Respondent contested the alleged unpaid dues and assessments
demanded by petitioner.
The issue is not novel. The nature of an action involving any dispute as to the validity of the assessment of association dues has been
settled by the Court in Chateau de Baie Condominium Corporation v. Moreno.27 In that case, respondents therein filed a complaint for
intra-corporate dispute against the petitioner therein to question how it calculated the dues assessed against them, and to ask an
accounting of association dues. Petitioner, however, moved for the dismissal of the case on the ground of lack of jurisdiction alleging that
since the complaint was against the owner/developer of a condominium whose condominium project was registered with and licensed by
the HLURB, the latter has the exclusive jurisdiction. In sustaining the denial of the motion to dismiss, the Court held that the dispute as to
the validity of the assessments is purely an intra-corporate matter between petitioner and respondent and is thus within the exclusive
jurisdiction of the RTC sitting as a special commercial court. More so in this case as respondent repeatedly questioned his characterization
as a delinquent member and, consequently, petitioner’s decision to bar him from exercising his rights to vote and be voted for. These
issues are clearly corporate and the demand for damages is just incidental. Being corporate in nature, the issues should be threshed out
before the RTC sitting as a special commercial court. The issues on damages can still be resolved in the same special commercial court just
like a regular RTC which is still competent to tackle civil law issues incidental to intra-corporate disputes filed before it.28
Moreover, Presidential Decree No. 902-A enumerates the cases over which the Securities and Exchange Commission (SEC) exercises
exclusive jurisdiction:
xxxx
b) Controversies arising out of intra-corporate or partnership relations, between and among stockholders, members or
associates; between any or all of them and the corporation, partnership or association of which they are stockholders,
members, or associates, respectively; and between such corporation, partnership or association and the State insofar as it
concerns their individual franchise or right to exist as such entity; and
c) Controversies in the election or appointment of directors, trustees, officers, or managers of such corporations, partnerships,
or associations.29
To be sure, this action partakes of the nature of an intra-corporate controversy, the jurisdiction over which pertains to the SEC. Pursuant
to Section 5.2 of Republic Act No. 8799, otherwise known as the Securities Regulation Code, the jurisdiction of the SEC over all cases
enumerated under Section 5 of Presidential Decree No. 902-A has been transferred to RTCs designated by this Court as Special
Commercial Courts.30 While the CA may be correct that the RTC has jurisdiction, the case should have been filed not with the regular court
but with the branch of the RTC designated as a special commercial court. Considering that the RTC of Makati City, Branch 58 was not
designated as a special commercial court, it was not vested with jurisdiction over cases previously cognizable by the SEC.31The CA,
therefore, gravely erred in remanding the case to the RTC for further proceedings.
Indeed, Republic Act (RA) No. 9904, or the Magna Carta for Homeowners and Homeowners’ Associations, approved on January 7, 2010 Basically that is correct. We are not authorized by the Senate nor – because we have discussed this lengthily on the floor, actually, several
and became effective on July 10, 2010, empowers the HLURB to hear and decide inter-association and/or intra-association controversies months on the floor. And we don’t have the authority as well for other Bicam members to add a provision to include a separate entity that
or conflicts concerning homeowners’ associations. However, we cannot apply the same in the present case as it involves a controversy has already their legal or their established Republic Act tackling on that particular issue. But we just like to put on record, we sympathize
between a condominium unit owner and a condominium corporation. While the term association as defined in the law covers with the plight of our friends in the condominium associations and we will just guarantee them that we will work on an amendment to the
homeowners’ associations of other residential real property which is broad enough to cover a condominium corporation, it does not seem Condominium Corporation Code. So with that – we skipped, that is correct, we have to go back to homeowners’ association definition,
to be the legislative intent. A thorough review of the deliberations of the bicameral conference committee would show that the Your Honor, because we had skipped it altogether. So just quickly going back to Page 7 because there are amendments to the definition of
lawmakers did not intend to extend the coverage of the law to such kind of association. We quote hereunder the pertinent portion of the homeowners. If it is alright with the House Panel, adopt the opening phrase of Subsection 7 of the Senate version as opening phrase of
Bicameral Conference Committee’s deliberation, to wit: Subsection 10 of the reconciled version.
THE CHAIRMAN (SEN. ZUBIRI). Let’s go back, Mr. Chair, very quickly on homeowners. x x x x33
THE ACTING CHAIRMAN (REP. ZIALCITA). Ang sa akin lang, I think our views are similar, Your Honor, Senator Zubiri, the entry of the To be sure, RA 4726 or the Condominium Act was enacted to specifically govern a condominium. Said law sanctions the creation of the
condominium units might just complicate the whole matters. So we’d like to put it on record that we’re very much concerned about the condominium corporation which is especially formed for the purpose of holding title to the common area, in which the holders of
plight of the Condominium Unit Homeowners’ Association. But this could very well be addressed on a separate bill that I’m willing to co- separate interests shall automatically be members or shareholders, to the exclusion of others, in proportion to the appurtenant interest
sponsor with the distinguished Senator Zubiri, to address in the Condominium Act of the Philippines, rather than address it here because of their respective units.34 The rights and obligations of the condominium unit owners and the condominium corporation are set forth in
it might just create a red herring into the entire thing and it will just complicate matters, hindi ba? the above Act.
THE CHAIRMAN (SEN. ZUBIRI). I also agree with you although I sympathize with them---although we sympathize with them and we feel Clearly, condominium corporations are not covered by the amendment. Thus, the intra-corporate dispute between petitioner and
that many times their rights have been also violated by abusive condominium corporations. However, there are certain things that we respondent is still within the jurisdiction of the RTC sitting as a special commercial court and not the HLURB. The doctrine laid down by the
have to reconcile. There are certain issues that we have to reconcile with this version. Court in Chateau de Baie Condominium Corporation v. Moreno35 which in turn cited Wack Wack Condominium Corporation, et al v. CA36 is
In the Condominium Code, for example, they just raised a very peculiar situation under the Condominium Code --- Condominium still a good law.
Corporation Act. It’s five years the proxy, whereas here, it’s three years. So there would already be violation or there will be already a WHEREFORE, we hereby GRANT the petition and REVERSE the Court of Appeals Decision dated July 10, 2007 and Resolution dated January
problem with their version and our version. Sino ang matutupad doon? Will it be our version or their version? 25, 2008 in CA-G.R. CV No. 86614. The Complaint before the Regional Trial Court of Makati City, Branch 58, which is not a special
So I agree that has to be studied further. And because they have a law pertaining to the condominium housing units, I personally feel that commercial court, docketed as Civil Case No. 03-1018 is ordered DISMISSED for lack of jurisdiction. Let the case be REMANDED to the
it would complicate matters if we include them. Although I agree that they should be looked after and their problems be looked into. Executive Judge of the Regional Trial Court of Makati City for re-raffle purposes among the designated special commercial courts.
Probably we can ask our staff, Your Honor, to come up already with the bill although we have no more time. Hopefully we can tackle this SO ORDERED.
again on the 15th Congress. But I agree with the sentiments and the inputs of the Honorable Chair of the House panel. DIOSDADO M. PERALTA
May we ask our resource persons to also probably give comments? Associate Justice
Atty. Dayrit. WE CONCUR:
MR. DAYRIT. PRESBITERO J. VELASCO, JR.
Yes I agree with you. There are many, I think, practices in their provisions in the Condominium Law that may be conflicting with this Associate Justice
version of ours. Chairperson
For instance, in the case of, let’s say, the condominium, the so-called common areas and/or maybe so called open spaces that they may G.R. No. 90503 September 27, 1990
have, especially common areas, they are usually owned by the condominium corporation. Unlike a subdivision where the open spaces NESTOR SANDOVAL, petitioner,
and/or the common areas are not necessarily owned by the association. Because sometimes --- generally these are donated to the vs.
municipality or to the city. And it is only when the city or municipality gives the approval or the conformity that this is donated to the HON. DOROTEO CAÑEBA, Presiding Judge, RTC, Manila, Branch 20, DEPUTY SHERIFF OF MANILA (RTC, Manila, Branch 20), and ESTATE
homeowners’ association. But generally, under PD [Presidential Decree] 957, it’s donated. In the Condominium Corporation, hindi. Lahat DEVELOPERS & INVESTORS CORPORATION, respondents.
ng mga open spaces and common areas like corridors, the function rooms and everything, are owned by the corporation. So that’s one Arnold V. Guerrero & Associates for petitioner.
main issue that can be conflicting. Lino M. Patajo for private respondent.
THE CHAIRMAN (SEN. ZUBIRI). I’ll just ask for a one-minute suspension so we can talk.
THE ACTING CHAIRMAN (REP. ZIALCITA). Unless you want to put a catchall phrase like what we did in the Senior Citizen’s Act. Something GANCAYCO, J.:
like, to the extent --- paano ba iyon? To the extent that it is practicable and applicable, the rights and benefits of the homeowners, are The issue in this petition is whether or not the ordinary courts have jurisdiction over the collection of unpaid installments regarding a
hereby extended to the --- mayroon kaming ginamit na phrase eh...to the extent that it be practicable and applicable to the unit subdivision lot.
homeoweners, is hereby extended, something like that. It’s a catchall phrase. But then again, it might create a... On August 20, 1987 private respondent filed a complaint in the Regional Trial Court (RTC) of Manila for the collection of unpaid
MR. JALANDONI. It will become complicated. There will be a lot of conflict of laws between the two laws. installments regarding a subdivision lot, pursuant to a promissory note, plus interest. On January 29, 1988 the trial court rendered a
THE ACTING CHAIRMAN (REP. ZIALCITA). Kaya nga eh. At saka, I don’t know. I think the --- mayroon naman silang protection sa ano eh, di decision.
ba? Buyers decree doon sa Condominium Act. I’m sure there are provisions there eh. Huwag na lang, huwag na lang. It appears that petitioner was declared in default so much so that after receiving the evidence of private respondent, the trial court
MR. JALANDONI. Mr. Chairman, I think it would be best if your previous comments that you’d be supporting an amendment.1âwphi1 I rendered its decision on January 19,1988, the dispositive portion of which reads as follows:
think that would be --- Well, that would be the best course of action with all due respect. WHEREFORE, on the allegations and the prayer of the complaint and the evidence adduced in
THE ACTING CHAIRMAN (REP. ZIALCITA). Yeah. Okay. Thank you. So iyon na lang final proposal naming ‘yung catchall phrase, "With support therefor, judgment is hereby rendered, ordering the defendant to pay plaintiff the
respect to the..."32 following:
xxxx 1. The sum of P73,867.42 plus interest and other charges commencing from January 1, 1988 until fully paid;
THE CHAIRMAN (SEN. ZUBIRI). xxx And so, what is their final decision on the definition of homeowners? 2. Such sum which shall not be less than P2,000.00 or 25% of the amount of delinquency whichever is greater, as
THE ACTING CHAIRMAN (REP. ZIALCITA). and for attorney's fees.
We stick to the original, Mr. Chairman. We’ll just open up a whole can of worms and a whole new ball game will come into play. Besides, I 3. Costs against the defendant.
am not authorized, neither are you, by our counterparts to include the condominium owners. 4. SO ORDERED. 1
THE CHAIRMAN (SEN. ZUBIRI). On September 28, 1988 the trial court issued an order directing the issuance of a writ of execution to enforce its decision that had
become final and executory.
On September 30, 1988 petitioner filed a motion to vacate judgment and to dismiss the complaint on the ground that the lower court has
no jurisdiction over the subject matter and that its decision is null and void. A motion for reconsideration of the writ of execution was also
filed by petitioner. An opposition to both motions was filed by private respondent to which a reply was filed by petitioner.
On February 17, 1989 the trial court denied the motion to vacate the judgment on the ground that it is now beyond the jurisdiction of the
Court to do so. It directed the issuance of a writ of execution anew.
Hence the herein petition wherein it is alleged that the trial court committed a grave abuse of discretion as follows:
5.1. The respondent Judge gravely abused his discretion and acted without jurisdiction in taking cognizance of the
complaint before him notwithstanding that exclusive and original jurisdiction over the subject-matter thereof is
vested with the Housing and Land Use Regulatory Board (HLURB) pursuant to PD 957.
5.2. The respondent Judge gravely abused his discretion and acted without jurisdiction in refusing to vacate his
judgment rendered without jurisdiction and in issuing a writ of execution to implement his abovesaid void
judgment. 2
The petition is impressed with merit.
Under Section 1 of Presidential Decree No. 957 the National Housing Authority (NHA) was given the exclusive jurisdiction to hear and
decide certain cases as follows:
SEC.1. In the exercise of its function to regulate the real estate trade and business and in addition to its powers
provided for in Presidential Decree No. 957, the National Housing Authority shall have exclusive jurisdiction to hear
and decide cases of the following nature:
A. Unsound real estate business practices:
B. Claims involving refund and any other claims filed by subdivision lot or condominium unit buyer against the
project owner, developer, dealer, broker or salesman;and
C. Cases involving specific performance of contractual and statutory obligations filed by buyers of subdivision lot or
condominium unit against the owner, developer, dealer, broker or salesman. (Emphasis supplied.)
The language of this section, particularly, the second portion thereof, leaves no room for doubt that exclusive jurisdiction over the case
between the petitioner and private respondent is vested not on the RTC but on the NHA. The NHA was re-named Human Settlements
Regulatory Commission and thereafter it was re-named as the Housing and Land Use Regulatory Board (HLURB). 3
Undeniably the sum of money sought to be collected by private respondent from petitioner represented unpaid installments of a
subdivision lot which the petitioner purchased. Petitioner alleges that he suspended payments thereof because of the failure of the
developer to develop the subdivision pursuant to their agreement.
In Antipolo Realty Corporation vs. National Housing Authority, 4 the suit which was filed with the NHA, likewise involved non-payment of
installments over a subdivision lot, wherein this Court held that the NHA has exclusive authority to hear and decide the case.
In Solid Homes, Inc. vs. Teresita Payawal, 5 this Court ruled that upon the issuance of Presidential Decree No. 957, the trial court may no
longer assume jurisdiction over the cases enumerated in Section 1 of Presidential Decree No. 397. We even stated therein that the
Housing and Land Use Regulatory Board has the authority to award damages in the exercise of this exclusive power conferred upon it by
Presidential Decree No. 1344.
In Estate Developers and Investors Corporation vs. Antonio Sarte and Erlinda Sarte, G.R. No. 93646, which is a case substantially similar to
the instant case, in a resolution of August 13, 1990 this Court upheld the exclusive jurisdiction of the HLURB over the collection suit.
Considering that the trial court has no jurisdiction under the circumstances obtaining in this case, the decision it rendered is null and
void ab initio. It is as if no decision was rendered by the trial court at all.
When as in this case the attention of the trial court is drawn to its lack of competence and authority to act on the case, certainly the trial
court has a duty to vacate the judgment by declaring the same to be null and void ab initio.
This is as it should be. Inasmuch as the questioned judgment is null and void, it is, as above observed, as if no decision had been rendered
by the trial court. It cannot become final and exucutory, much less can it be enforced by a writ of execution.
The trial court, rather than reiterating the issuance of a writ of execution in this case, which it did, should have recalled and cancelled the
writ of execution of the judgment.
WHEREFORE, the petition is GRANTED. The questioned decision of the trial court dated January 29, 1988 is hereby declared null and void
for lack of jurisdiction. No pronouncement as to costs.
SO ORDERED.
Narvasa (Chairman), Cruz, Griño-Aquino and Medialdea, JJ., concur.
G.R. No. 97381 November 5, 1992
BENIGNO V. MAGPALE, JR., petitioner,
vs.
CIVIL SERVICE COMMISSION and ROGELIO A. DAYAN, in his capacity as the General Manager of the Philippine Ports
Authority, respondents.
MELO, J.:
Before Us is a petition for review on certiorari assailing Resolution No. 90-962 dated October 19, 1990 of respondent Civil Service
Commission (CSC). Said CSC resolution set aside and modified the decision dated February 5, 1990 of the Merit System Protection Board
in MSPB Case No. 449, which ordered the immediate reinstatement in the service of herein petitioner Benigno V. Magpale, Jr., without
loss of seniority rights and with payment of back salaries and other emoluments to which he is entitled under the law.
The record shows that petitioner started his career in government as an employee in the Presidential Assistance on Community
Development in 1960. Fifteen years later, or in 1975, he transferred to the Philippine Ports Authority (PPA) as Arrastre Superintendent. He
was promoted to the position of Port Manager in 1977 of the Port Management Unit (PMU), General Santos City. Then he was reassigned,
in the same year to PPA-PMU, Tacloban City where he likewise discharged the functions of Port Manager. On December 1, 1982, the PPA
General Manager designated Atty. William A. Enriquez as officer-in-charge of PPA-PMU, Tacloban City effective December 6, 1982. On
January 6, 1983, petitioner was ordered to immediately report to the Assistant General Manager (AGM) for Operation, PPA, Manila,
Petitioner reported at PPA Manila on the same date and performed the duties and functions assigned to him.
In an Internal Control Department Report dated March 5, 1984, the PMU-Tacloban Inventory Committee and the Commission on Audit
(COA) stated that petitioner failed to account for equipment of PPA value at P65,542.25 and to liquidate cash advances amounting to
P130,069.61. He was found also to have incurred unauthorized absences from May 25, 1984 to July 23, 1984.
On July 23, 1984, or nineteen months after he began reporting in Manila, a formal charge for Dishonesty, Pursuit of Private Business
without permission as required by Civil Service Rules and Regulations, Frequent and Unauthorized Absences and Neglect of Duty was filed
against petitioner. Based on said charges he was ordered preventively suspended and has been out of service since then.
For almost four years the case remained unacted upon. The formal investigation and hearing resumed on September 18, 1987.
On January 18, 1989 a Decision was rendered by the Secretary of the Department of Transportation and Communication (DOTC), through
its Administrative Action Board, finding petitioner guilty of Gross Negligence on two counts: (a) for his failure to account for the forty-four
(44) assorted units of equipment, among them a Sony Betamax and a TV Camera, and (b) for failing to render the required liquidation of
his cash advances amounting to P44,877.00 for a period of four years. Petitioner was also found guilty of frequent and unauthorized
absences. Accordingly, he was meted the penalty of dismissal from the service with the corresponding accessory penalties.
When petitioner's motion for reconsideration of the aforesaid Decision was denied in the DOTC's Order of February 20, 1989, he appealed
to the Merit System and Protection Board (MSPB) of respondent Civil Service Commission.
On February 5, 1990, the MSPB rendered a Decision reversing the Decision of the DOTC. The pertinent portion of the MSPB's Decision
reads:
After a careful review of the record of the case, this Board found the appeal meritorious. Respondent cannot be
held liable for Gross Negligence for his alleged failure to account for several properties and for failure to liquidate
the cash advances he received as there was no showing that he has been specifically required to do so either by law
or regulation. The mere detail of respondent to PPA-Manila, in the absence of an order requiring him to turn over
and account for the funds and property received for his office at PMU-Tacloban will not necessarily obligate him to
make accounting for the same.
Moreover, Section 105, Chapter 5 of Presidential Decree 1445, otherwise known as "The Government Auditing Code
of the Philippines" measured the liability of an officer accountable for government property only to the money
value of said property. Though respondent is the person primarily liable for these funds and property, he holds this
liability jointly with the person who has the actual possession thereof and who has the immediate responsibility for
the safekeeping.
As to the charge relative to respondent's frequent unauthorized absences had been sufficiently and convincingly
explained, due to which the Board found him not at all guilty of the offense charged (sic).
IN VIEW THEREOF, the decision appealed from is hereby reversed. Respondent-Appellant Magpale should
immediately by reinstated in the service without loss of seniority rights and with payment of back salaries and other
emoluments to which he is entitled under the law. (pp. 31-32, Rollo.)
On March 1, 1990, PPA, through its General Manager, herein respondent Rogelio A Dayan, filed an appeal with the Civil Service Field
Office-PPA, and the latter office indorsed the appeal to respondent CSC in a letter dated March 5, 1990.
On March 5, 1990, petitioner requested the Secretary of the DOTC to direct the PPA to implement the MSPB decision as it has become
final and executory. Said request was reiterated in another letter also dated March 5, 1990 by petitioner to OIC Wilfredo M. Trinidad of
the Office of the Assistant Secretary for Administration and Legal Affairs, DOTC.
On March 13, 1990, petitioner filed with the MSPB a Motion for Implementation of the MSPB decision. This was opposed by the PPA
through its General Manager.
On April 27, 1990 petitioner filed with respondent CSC his comment to the appeal of the PPA contending that he is not an accountable
officer and is under no obligation to account for the property and equipment; that said property and equipment were not received by him
as custodian and he should not be held liable for the loss of the same; that the said property and equipment were place in PPA-PMU
Tacloban City which the herein petitioner left on October 8, 1982 and since then had lost control over them. Moreover, petitioner averred
that as to the unliquidated cash advances of P44,877.00, the same had long been liquidated. Finally, petitioner claimed that his failure to
secure the clearance for any possible property or financial obligation in PMU-Tacloban was due to the urgency of his transfer to PPA-
Manila and the absence of any order or demand to secure the clearance.
On May 29, 1990, the MSPB issued an Order for the immediate implementation of its February 5, 1990 Decision ruling that:
Records further show that a copy of this Board's decision was received by the Office of the Honorable Secretary,
that Department, thru Mr. Frankie Tampus on February 6, 1990. Records finally show that as of March 5, 1990, no
motion for reconsideration of this Board's aforementioned decision has ever been filed as evidenced by the
certification of even date issued and signed by Director Adelaida C. Montero of the Office for Central Personnel
Records, this Commission. Hence, said decision has long become final and executory. (p. 34, Rollo.)
On June 28, 1990, petitioner filed a Motion to Dismiss the appeal of PPA claiming that:
1. Appeal of PPA was filed out of time and that the CSC has no jurisdiction over it;
2. The PPA has not exhausted administrative remedies before appealing to the higher body, the CSC;
3. The MSPB decision has become final and therefore cannot be disturbed anymore.
(p. 22, Rollo.)
On October 19, 1990, respondent CSC rendered its now assailed Resolution No. 90-962, the pertinent portion of which reads as follows:
The Commission thus holds respondent Magpale guilty of Gross Neglect of Duty on two (2) counts for the forty-four
(44) equipments (sic) under his charge and to render an accounting for cash advances amounting to P44,877.90.
Accordingly, considering two mitigating circumstances of length of service and first offense in favor of respondent,
the commission hereby imposes a penalty of suspension for a period of one (1) year against him. As he has been out
of the service since 1984, the penalty is deemed served and he should now be reinstated to his former position. This
is, however, without prejudice to any criminal or civil proceedings that the agency concerned or the COA may
institute as proper under the premises.
Finally, the decision of the MSPB exonerating the respondent Magpale for Gross Negligence is hereby reversed.
Corollarily, the order of payment of back salaries is hereby set aside. MSPB is likewise reminded to be more
circumspect on matters of this nature, especially as the instant case involves accountability of public funds and
property.
WHEREFORE, foregoing premises considered, the Commission finds respondent Benigno V. Magpale, Jr., guilty of
Gross Neglect of Duty on two (2) counts for failure to account for the forty-four (44) equipments (sic) under his
charge and to render an accounting for cash advance amounting to P44,877.90. In view of the attendant mitigating
circumstances of length of service and first offense in favor of respondents and the Neglect of Duty to account for
cash advance in the amount of P44,877.90 (second count) be appreciated as an aggravating circumstances, the
penalty of suspension for one (1) year shall be imposed against respondent. This shall be without prejudice to any
criminal or civil proceeding that PPA or COA may institute against respondent. Accordingly, the Decision and Order
of MSBP dated February 5, 1990 and May 29, 1990, respectively, are hereby set aside. (pp. 27-28, Rollo.)
Hence, the present recourse.
The petition alleges that respondent CSC, in issuing its Resolution No. 90-962, gravely abused its discretion because:
1. The law did not authorize an appeal by the government from an adverse decision of the Merit Systems Protection
Board (MSBP);
2. Respondent PPA General Manager did not have the right or legal personality to appeal from the MSPB decision;
3. Assuming that the appeal was available to respondent DAYAN, the same was filed out time after the MSPB
decision had long become final and executory. (pp. 6-7, Petition; pp. 7-8, Rollo.)
In support of this first contention, petitioner invokes Paragraph 2(a). Section 16, Chapter 3, Subtitle A, Title I, Book V of Executive Order
No. 292, otherwise known as the Administrative Code of 1987 which provides:
Sec. 16. Offices in the Commission. — The Commission shall have the following offices:
xxx xxx xxx
(2) The Merit Systems Protection Board composed of a Chairman and two (2) members shall
have the following functions:
(a) Hear and decide on appeal administrative cases involving officials
and employees of the Civil Service. Its decision shall be final except
those involving dismissal or separation from the service which may be
appealed to the Commission. (Emphasis supplied.)
claiming that since the MSBP decision was for dismissal or separation from the service, but reinstatement without loss of seniority rights
and with payment of back salaries, the said MSBP decision should be deemed final, immediately executory and unappealable.
Petitioner next contends that assuming, for the sake of argument, that the decision of the MSBP was appealable, respondent Dayan, even
in his capacity as General Manager of the PPA, did not have the legal personality not the right to appeal the decision of the
MSBP, citing Paragraph 1, Section 49, Chapter 7, Subtitle A, Title I, Book V, of Executive Order No. 292 and the case of Paredes vs. CSC,
G.R. No. 88177, December 4, 1990, 192 SCRA 84.
Assuming further that the MSBP decision was appealable and that respondent Dayan had the legal personality to appeal the MSBP
decision, petitioner still contends that the appeal should not have been given due course by the respondent CSC because the appeal was
not filed with the proper disciplining office in accordance with same Section 49 of Executive Order No. 292, which in this case, should be
the DOTC, not with the CSC Field Office at the PPA.
On the merit of the petition, petitioner claims that assuming even further that an appeal lies from the MSBP decision, that respondent
Dayan had the legal personality or standing to institute the appeal that it was filed with the proper office, still CSC Resolution 90-962 was
rendered with grave abuse of discretion because petitioner cannot be suspended for alleged failure to account for pieces of equipment
and cash advances since this is not the neglect of duty contemplated by Section 36 of Presidential Degree No. 807 or Section 46 of chapter
in the Civil Service in Executive Order 292. At most, petitioner can be held liable for the money value of the equipment and advances as
mandated by Section 105 of Presidential Decree No. 1445, the Government Auditing Code of the Philippines.
For its part, respondent CSC maintains —
First, that the finality of the MSPB decision in the disciplinary cases as stated in Section 16, Paragraph 2(a), Book V of Executive Order No.
292, relied upon by petitioner, is modified by section 12, Paragraph 11, Book V, of the same Executive Order No. 292, which reads:
Sec. 12. Powers and Functions. — The Commission shall have the following powers and functions:
xxx xxx xxx
(11) Hear and decide administrative case instituted by or bought directly or on appeal, including contested
appointments, and review decisions and actions of its offices and of the agencies attached to it.
Furthermore, relevant provisions of Executive Order No 135 dated February 25, 1987 amending Section 19(b) of Presidential Decree No.
807 and Section 8 of Presidential Decree No. 1409 state, thus:
WHEREAS, in the interest of justice, there is a need to confer upon the Civil Service Commission jurisdiction over
appeal in contested or provisional appointments and to make its decision thereon, as well as in administrative
disciplinary cases final and reviewable by the Supreme Court.
xxx xxx xxx
Relationship with the Civil Service Commission. –– The Commission shall hear and decide appeals from other
decisions of the Board provided that the decisions of the Commission shall be subject to review on certiorari upon
receipt of the copy thereof by the aggrieved part.
Thus, respondent CSC argues that it is deemed not to have lost its appellate jurisdiction over the decisions of the MSPB in administrative
disciplinary case.
Second, the case of Paredes vs. CSC is not applicable. Respondent Dayan appealed the MSPB decision not in his personal capacity nor in
pursuit in his private interest, but as head of PPA, being the general manager thereof.
Third, the appeal was filed with the proper disciplining office because the decision appealed from was that of the MSPB, one of the offices
in respondent CSC. Thus, respondent CSC was justified in giving due course to PPA's notice of appeal filed with its (CSC) Field Office at the
PPA.
Finally, petitioner's claim that he is liable only for the money value of the property and cash advances and cannot be administratively
charged for such infraction is untenable and a mockery of the civil service law. For his failure to account for the property under his charge
and to liquidate his cash advances, petitioner is guilty of Gross Neglect of Duty and should have been dismissed from the service if no
mitigating circumstances were considered in his favor.
We gave due course to the petition and required the parties to file their respective memoranda. After considering the same and the
pertinent laws and jurisprudence, We find that the petition must be granted.
After Mendez vs. Civil Service Commission, (204 SCRA 965 [1991]), the extent of the authority of respondent CSC to review the decisions of
the MSPB is now a settled matter.
The Court, in said case held:
It is axiomatic that the right to appeal is merely a statutory privilege and may be exercised
only in the manner and in accordance with the provisions of law. (Victorias Milling Co., Inc. vs.
Office of the Presidential Assistant for Legal Affairs, 153 SCRA 318).
A cursory reading of P.D. 807, otherwise known as "The Philippines Civil Service Law" shows
that said law does not contemplate a review of decisions exonerating officers or employees
from administrative charges.
Section 37 paragraph (a) thereof, provides:
The Commission shall decide upon appeal all administrative disciplinary cases involving the
imposition of the penalty of suspension for more than thirty days, or fine in an amount
exceeding thirty day's salary, demotion in rank or salary or transfer, removal or dismissal from
office. . . . (Emphasis supplied) (p. 7. Rollo)
 Said provisions must be read together with Section 39 paragraph (a) of P.D. 805 which contemplates:
Appeals, where allowable, shall be made by the party adversely affected by the decision . . .
(Emphasis supplied) (p. 104, Rollo)
The phrase "party adversely affective by the decision" refers to the government employees against whom the
administrative case is filed for the purpose of disciplinary action which may take the form of suspension, demotion
in rank or salary, transfer, removal or dismissal from office. In the instant case, Coloyan who filed the appeal cannot
be considered an aggrieved party because he is not the respondent of the administrative case below.
Finally, pursuant to Section 37 paragraph (b) of P.D. 807, the city mayor, as head of the city government, is
empowered to enforce judgment with finality on lesser penalties like suspension from work for one month and
forfeiture of salary equivalent to one month against erring employees.
By inference or implication, the remedy of appeal may be availed of only in a case where the respondent is found
guilty of the charges filed against him. But the respondent is exonerated of said charges, as in this case, there is no
occasion on appeal. (pp. 967-968)
The above ruling is a reiteration of the earlier pronouncement in Paredes vs. Civil Service Commission, (192 SCRA 84 [1990]) cited by
petitioner, where We said:
Based on the above provisions of law, appeal to the Civil Service Commission in an administrative case is extended
to the party adversely affected by the decision, that is, the person or the respondent employee who has been
meted out the penalty of suspension for more than thirty days; or fine in an amount exceeding thirty days salary
demotion in rank or salary or transfer, removal or dismissal from office. The decision of the disciplining authority is
even final and not appealable to the Civil Service Commission in cases where the penalty imposed is suspension for
not more than thirty days or fine in an amount not exceeding thirty days salary. Appeal in cases allowed by law
must be filed within fifteen days from receipt of the decision.
Here the MSPB after hearing and the submission of memoranda exonerated private respondent Amor of all charges
except for habitual tardiness. The penalty was only a reprimand so that even private respondent Amor, the party
adversely affected by the decision, cannot even interpose an appeal to the Civil Service Commission.
As correctly ruled by respondent, petitioner Paredes the complainant is not the part adversely affected by the
decision so that she has no legal personality to interpose an appeal to the Civil Service Commission. In an
administrative case, the complainant is a mere witness (Gonzalo vs. D. Roda, 64 SCRA 120). Even if she is the Head
of the Administrative Services Department of the HSRC as a complaint she is merely a witness for the government in
an administrative case. No private interest is involved in an administrative case as the offense is committed against
the government. (pp. 98-99)
While it is true, as contended by respondent Civil Service Commission that under Section 12 (par. 11), Chapter 3, Subtitle A, Book V of
Executive Order 292, the CSC does have the power to —
Hear and decide administrative cases instituted by or brought before it directly or on appeal, including contested
appointments, and review decisions and actions of its offices and of the agencies attached to it. . . .
the exercise of the power is qualified by and should be read together with the other sections of the same sub-title and book of Executive
Order 292, particularly Section 49 which prescribes the following requisites for the exercise of the power of appeal, to wit:
(a) the decision must be appealable;
(b) the appeal must be made by the party adversely affected by the decision;
(c) the appeal must be made within fifteen days from receipt of the decision, unless a petition for the
reconsideration is seasonably filed; and
(d) the notice of appeal must be filed with the disciplining office, which shall forward the records of the case,
together with the notice of appeal to the appellate authority within fifteen days from filing of the notice of appeal,
with its comments, if any.
Under Section 47 of the same Code, the CSC shall decide on appeal all administrative disciplinary cases involving the imposition of:
(a) a penalty of suspension for more than thirty days; or
(b) fine in an amount exceeding thirty days salary; or
c) demotion in rank or salary or transfer; or
(d) removal or dismissal from office.
The February 5, 1990 decision of the MSPB did not involve dismissal or separation from office, rather, the decision exonerated petitioner
and ordered him reinstated to his former position. Consequently, in the light of our pronouncements in the aforecited cases of Mendez
v. Civil Service Commission and Paredes vs. Civil Service Commission, the MSPB decision was not a proper subject of appeal to the CSC.
Settled is the rule that a tribunal, board, or officer exercising judicial functions acts without jurisdiction if no authority has been conferred
by law to hear and decide the case. (Acena v. Civil Service Commission, 193 SCRA 623 [1991]).
WHEREFORE, the decision of the Civil Service Commission is hereby ANNULLED and SET ASIDE and the decision of the Merit Systems
Protection Board dated February 5, 1990 is hereby REINSTATED.
SO ORDERED.
Gutierrez, Jr., Cruz, Feliciano, Padilla, Bidin, Griño-Aquino, Regalado, Davide, Jr., Romero, Nocon, Bellosillo and Campos, Jr., JJ., concur.
Narvasa, C.J., and Medialdea, J., are on leave.
G.R. No. L-24680 October 7, 1968
JESUSA VDA. DE MURGA, plaintiff-appellee,
vs.
JUANITO CHAN, defendant-appellant.
Jose Go and Fernando P. Blanco for plaintiff-appellee.
Abelardo A. Climaco, T. de los Reyes, Enrique A. Fernandez and Ernani Cruz Paño for defendant-appellant.
ANGELES, J.:
In this appeal, two issues involving questions of law are posed for resolution: First, whether or not the allegations in the complaint
constitute a cause of action for unlawful detainer, and confer jurisdiction over the case to the municipal court (now city court) of
Zamboanga City, under the provisions of Rule 70 of the Rules of Court and decisions interpreting the same, when particularly considered
in the light of the contexture of the pertinent letter of demand to vacate the leased premises (Annex J of the Complaint), couched in the
following wise:
Please be advised further that we reiterate our demand made to you in our registered letter dated February 4, 1959 (to vacate
the leased premises) which was received by you on the 10th instant, unless you pay the amount of Six Hundred pesos
(P600.00) or Seven Hundred pesos (P700.00) as new rental per our letter of January 19, 1959, before the expiration of the 15-
day period granted you for vacating the same.
and, Second, whether or not the lessor and the lessee had agreed upon an automatic renewal of the lease of the premises, under the
stipulation in clause "7" of the corresponding contract of lease, containing the following agreement:
7. — That upon the termination of the term of Ten (10) years above expressed, the said Jesusa Vda. de Murga shall have the
option to purchase the building or buildings belonging to and constructed by the said Juanito Chan, and the price of said
building or buildings shall be determined by three commissioners, two of whom shall be appointed by each of the parties, and
the remainder commissioner shall be appointed by both. However, in the event that the said Jesusa Vda. de Murga shall not
exercise the right granted her for any reason or cause, this contract of lease shall be automatically renewed but the period for
said renewal shall, however, be fixed and adjusted again by the parties. It is agreed further that in case of said renewal, the
rental shall also be adjusted by the parties depending on the business condition which shall then at that time prevail. (Exhibit
A.)
Jesusa Vda. de Murga was the owner of two parcels of land in the City of Zamboanga, designated as lots 36 and 38 of the cadastral plan of
the place, and covered by Transfer Certificates of Title Nos. 3237 and 3238, respectively.
On January 31, 1949, a contract of lease over said two lots was entered into by and between Jesusa Vda. de Murga as lessor, and Juanito
Chan as lessee, the basic terms of which pertinent to the present case are: The period of the lease was ten (10) years from January 31,
1949; the lessee to pay a monthly rent of P500.00 within the first ten days of every month; with the consent of the lessor, the lessee may
introduce improvements on the land; and Clause "7" quoted hereinabove. (Exhibit A.)
Upon taking possession of the leased premises, with the consent of the lessor, the lessee introduced improvements on the land consisting
of buildings of the total costs of P70,000.00. It is not disputed that the lessee paid in full the monthly rent during the ten- year period of
the lease.
As early as July 23, 1958, before the expiration of the ten-year period of the lease, there had been intercourse of communications
between the lessor and the lessee for the renewal of the lease, but the parties failed to arrive at an agreement; hence, this action by the
lessor against the lessee.
Thus, on July 23, 1958, the lessor informed the lessee of her willingness to renew the lease for five years at a monthly rent of P700.00.
(Exhibit B.) In his reply the lessee said:
... Much as I am willing to consider the suggested increase of rental, however, I would like to plead with you that due to very
poor business at present, I may not be able to consider your indicated increase. (Exhibit C.)
On August 1, 1958, the lessor advised the lessee that:
Beginning February 1, 1959, ... the rental of my lots ... will be P700.00. (Exhibit D.)
On January 18, 1959, the lessee advised the lessor that she (lessor) should purchase the buildings constructed on the land in accordance
with the stipulation in the contract of lease, and —
... In case you do not agree with the purchase of the aforesaid buildings, I am willing to continue occupying the land and
execute a new contract of lease, but I am appealing to you to take into consideration the prevailing business conditions by
reducing the monthly rental to P400.00, ... (Exhibit L.)
On January 19, 1959, the lessor replied that —
 ... she rejects the option to purchase the buildings, ... and her present last offer is: (a) Six hundred pesos (P600.00) rentals
payable within the first fifteen days of every month, without contract; or (b) Seven hundred pesos (P700.00) rentals payable
within the first fifteen days of every month, one year advanced rental, with a five-year contract. (Exhibit F.)
On January 20, 1959, the lessor informed the lessee that the conditions stated in the latter's letter of January 18, 1959, were not
acceptable to her. (Exhibit G.)
On January 21, 1959, the lessee advised the lessor that he (lessee) cannot accept the conditions stated in her (lessor's) letters of January
19 and 20, 1959 —
... y, insists que Vd. compre mis casas enclavadas en los lotes objeto de arrendamiento. Y en caso de su negative seguire
ocupando el solar bajo el pago de un alquiler mensual de Quinientos pesos (P500.00) debido al negocio reinante en estos dias,
tal como esta dispuesto en el contrato de arrendamiento firmado por Vd. y yo el dia 31 de Enero de 1949." (Exhibit H.)
On February 4, 1959, the lessor made demand on the lessee to vacate the premises —
... for the reason that the lease contract had expired on January 31, 1959, ... and the lessor had waived the right to exercise the
option granted her under paragraph "7" of said contract, ... (Exhibit I.)
On February 16, 1959, the lessee sent his check for P500.00 to the lessor in payment of the monthly rental corresponding to the month of
February, 1959. (See Exhibit J.)
On February 19, 1959, the lessor returned to the lessee the check which the latter had sent to the former, stating further in the letter that
she was demanding that the leased premises be vacated, if he (lessor) would not agree to pay the new rental of P600.00 or P700.00 a
month beginning February 1, 1959, as embodied in the letter, Exhibit J, hereinabove quoted.
Disregarding the written demand of the lessor, dated February 19, 1959, Exhibit J, the lessee chose to remain in the possession of the
leased premises and insisted that the contract of lease stipulated an automatic renewal of the lease, and conformably thereto, he has a
right to continue occupying the premises; and as token of his decision, he sent to the lessor his check for P500.00 in payment of the
monthly rent corresponding to the month of February 1959. The lessor was undoubtedly not satisfied with the tendered amount of
P500.00, because she had demanded P600.00 or P700.00, as new monthly rent as a condition for the renewal of the lease. And without
any further definite demand on the lessee to vacate the premises filed, on March 10, 1959, a complaint of unlawful detainer in the
municipal court of Zamboanga City against the lessee, Juanito Chan, to eject the latter from the leased premises. The facts alleged in the
complaint as cause of action, consisted in reproducing and reiterating the substance of the correspondence exchanged between lessor
and lessee, as narrated above, and claiming that the possession of the lessee of the premises had become illegal by his failure and refusal
to pay the increased new rental. For relief, the plaintiff prayed that the defendant be ordered to vacate the premises, and "TO PAY THE
NEW RENTS DEMANDED OF P600.00 or P700.00 FROM FEBRUARY 1, 1959 MONTHLY AS THE CASE MAY BE." Attached to the complaint, as
annexes thereto, were copies of the letters exchanged between the lessor and the lessee, Exhibits B to J.
In his answer (as amended), the defendant admitting the genuineness and authenticity of the letters annexed to the complaint, but
traversing some of the allegations therein, raised the defenses of lack of jurisdiction of the court over the case, and lack of cause of action
for unlawful detainer.
After a trial, decision was rendered ordering the defendant to vacate the premises, to pay the plaintiff the sum of P600.00 as monthly rent
from February 1, 1959, and P500.00 as attorney's fees.
The defendant appealed from the decision to the Court of First Instance of Zamboanga City. Before this Court, the defendant again raised
the special defenses of lack of jurisdiction of the municipal court and lack of cause of action for unlawful detainer. Ruling on the issue of
lack of jurisdiction, the court said:
With reference to the contention of defendant that the municipal court had no jurisdiction to try this case because the
interpretation, application and enforcement of the terms of the Lease Agreement is within the competence of a court higher
than that of the municipal court, deserves hardly any discussion. Suffice it to say that the jurisdiction of the municipal court is
grounded on Section 88 of the Judiciary Act of 1948.
After a trial, the Court of First Instance rendered judgment ordering the defendant to vacate the premises, to pay the plaintiff the sum of
P1,200.00 from February 1, 1959, as monthly rental of the land, and P2,000.00 as attorney's fees.
From the foregoing decision, the defendant interposed a direct appeal to this Court. Therefore, only questions of law may be considered
in this appeal.
Among the four errors assigned by the appellant in his brief, the first two pose the issue of lack of jurisdiction of the municipal Court and
of the lack of cause of action for unlawful detainer; the remaining errors delving on questions of fact which, by reason of the nature of the
appeal are, therefore, deemed admitted and may not be reviewed in this appeal.
In relation to the issue of lack of jurisdiction of the municipal court over the case, it is to be noted that, after the lessor and the lessee had
failed to agree on the renewal of the lease which terminated on January 31, 1959, the lessor, on February 19, 1959, sent the demand
letter hereinabove quoted, Exhibit J. It was, then, as it is now, the contention of the lessee that such demand is not that kind of demand
contemplated in the Rules of Court as complying with the jurisdictional requirement — that demand to vacate is indispensable in order to
determine whether the tenant's possession has become illegal. On this matter, the rulings in the following cases are pertinent and
applicable:
The notice giving lessee the alternative either to pay the increased rental or otherwise to vacate the land is not the demand
contemplated by the Rules of Court in unlawful detainer cases. When after such notice, the lessee elects to stay, he thereby
merely assumes the new rental and cannot be ejected until he defaults in said obligation and necessary demand is first made.
(Manotok vs. Guinto, L-9540, April 30, 1957.)
The lessor may, under Article 1569 of the Civil Code, judicially disposses the lessee for default in the payment of the price
agreed upon. But where such default is based on the fact that the rent sought to be collected is not that agreed upon, an
action for ejectment cannot lie. (Belmonte vs. Martin, 42 Off. Gaz. No. 10, 2146.)
In the case at bar, it clearly appears from the demand letter of February 19, 1959, that the obligation to vacate the leased premises would
be dependent on the failure of the lessee to agree to the new rent demanded by the lessor. As the lessee, however, was in the physical
possession of the land by virtue of a prior contract of lease, and the demand was in the alternative imposing a new rental, even without
taking into account the efficacy of the stipulation for an automatic renewal of the lease, which shall be discussed hereafter, in the light of
the ruling in Belmonte vs. Martin, supra, without any subsequent definite demand to vacate the premises, subject to no condition, the
lessee did not incur in default which would give rise to a right on the part of the lessor to bring an action of unlawful detainer.
Delving on the second special defense to wit, that the allegations in the complaint do not constitute a cause of action of unlawful
detainer, it is the contention of the lessee-appellant that clause "7" of the contract of lease, quoted hereinabove, meant an express grant
to the lessee to renew the lease at his option, contrary to the claim of the lessor-appellee that there must be a prior mutual agreement of
the parties. As we read clause "7", We find that it envisioned the happening of two eventualities at the expiration of the lease on January
31, 1959 — either the lessor may purchase the improvements constructed by the lessee on the land, or in case the lessor fails, for any
cause or reason, to exercise the option to buy, the lease shall be deemed automatically renewed. The evidence has established that the
lessor had refused to buy the buildings on the land. The statement in said clause "7" that in case of renewal the duration of the lease and
the new rental to be paid shall be adjusted by the parties, is of no moment in the solution of the issue, whether or not the facts alleged in
the complaint constitute a cause of action of unlawful detainer. The pleadings of the parties, and the annexes thereto, clearly show that
the jugular vein of the controversy hinges on the correct interpretation of clause "7" of the contract of lease, a matter outside the
jurisdiction of the municipal court. The lessor-appellee maintains that the lease had terminated on January 31, 1959, renewable only upon
a new agreement of the parties; on the other hand, the lessee-appellant contends that, inasmuch as the controversy hinges on the
interpretation of clause "7" of the contract, that is, whether or not said clause contemplated an automatic renewal of the lease, the action
was not for unlawful detainer but one not capable of pecuniary estimation and, therefore, beyond the competence of the municipal
court.
The contention of the lessee-appellant must be sustained.
In Cruz vs. Alberto, 39 Phil. 991, the contract of lease had the following provision:
That the term of this contract of lease shall be six years from the date of the execution, and extendible for another six years
agreed upon by both parties.
It was contended by the lessor that the lease cannot be extended except upon mutual agreement. Ruling on the contention, the Supreme
Court said:
We are of the opinion that the trial judge was entirely correct in his interpretation of the contracts in question; and though it
must be admitted that this interpretation renders the words "agreed upon by both parties" superfluous yet this does not
involve any strain upon the meaning of the entire passage. If the interpretation which the appellant would have us adopt be
true, the entire clause relative to the extension of the term would be superfluous, for if the extension is only to be effective
upon a new agreement of the parties to be made at the expiration of the original term, why should anything at all be said
about an extension? Parties who are free to make one contract of lease are certainly free to make a new one when the old has
expired without being reminded of their faculty to do so by the insertion of a clause of this kind in the first lease. This would
not only be superfluous but nonsensical. The clause relative to the extension of the lease should, if possible, be so interpreted
as to give it some force.
As we interpret the contracts before us, the parties meant to express the fact that they had already agreed that there might be
an extension of the lease and had agreed upon its duration, thus giving the defendant the right of election to take for a second
term or to quit upon the expiration of the original term. The clause in question has the same meaning as if the words "agreed
upon by both parties" had been omitted and the passage had closed with a period after the word "years" in the first contract
and after "extension" in the third contract.
It has been held by this court that the word "extendible" standing without qualification in a contract of lease, means that the
term of the lease may be extended and is equivalent to a promise to extend, made by the lessor to the lessee, and, as
unilateral stipulation, obliges the promisor to fulfill his promise. (Legarda Koh vs. Ongsiako, 36 Phil. Rep. 185). Such a
stipulation is supported by the consideration which is at the basis of the contract of lease (16 R.C.L. pp. 883, 884) and obviously
involves a mutuality of benefit, or reciprocity, between the parties, notwithstanding the right of election is conceded solely to
the lessee. As a general rule, in construing provisions of this character, the tenant is favored, where there is any uncertainty,
 and not the landlord, upon the principle that a grant should be taken most strongly against the grantor. (15 R.C.L. p. 884, 24
Cyc. 915.)
In the case of Legarda Koh vs. Ongsiaco, 36 Phil. 189-190, the contract of lease had this provision:
The term of the said contract shall be for one year, counting from the 1st of December of the present year (1963) which term
shall be extendible at the will of both parties.
Said the Supreme Court:
According to Article 1091 of the Civil Code, obligations arising from contracts have legal force between the contracting parties
and must be fulfilled in accordance with their stipulation. Therefore, if the defendant bound himself to lease his properties for
the period of one year, which term should be extendible, it is evident and strictly in accord with justice that the plaintiff-lessee
has a right, at the termination of the first period of one year, to have the said contract of lease renewed in fulfillment of the
stipulated extension of the term of the lease; otherwise, the clause contained in the document Exhibit 1, that the lease at its
termination would be extendible, would be worthless.
The defendant-appellant is wrong in his contention that the renewal or extension of the contract depended solely upon
himself, notwithstanding the stipulations contained in said contract, inasmuch as the renewal and continuation of the lease
could not be left wholly to the plaintiff's free will, without counting on the defendant's consent — a consent expressly granted
in the promise that the term would be extended, which term, although its duration was not fixed, should be understood to be
for another year, a period equal to and not greater than the term of the lease.
When a contract of lease provides that the term thereof is extendible, the agreement is understood as being in favor of the
lessee, and the latter is authorized to renew the contract and to continue to occupy the leased property, after notifying the
lessor to that effect. The lessor can withdraw from the said contract only after having fulfilled his promise to grant the
extension of time stipulated therein, unless the lessee has failed to comply with or has violated the conditions of the contract.
It is not necessary that the extension be expressly conceded by the lessor because he consented thereto in the original
contract.
UPON THE FOREGOING CONSIDERATIONS, We declare that the municipal court (now city court) of Zamboanga City had no jurisdiction
over the case; therefore, the appealed decision is set aside and reversed, with costs against the plaintiff-appellee.
Concepcion, C.J., Reyes, J.B.L., Makalintal, Sanchez, Castro, Fernando and Capistrano, JJ., concur.
Dizon, J., took no part.
Zaldivar, J., is on leave.
G.R. No. 180321 March 20, 2013
EDITHA PADLAN, Petitioner,
vs.
ELENITA DINGLASAN and FELICISIMO DINGLASAN, Respondents.
DECISION
PERALTA, J.:
This is a petition for review on certiorari assailing the Decision1 dated June 29, 2007 of the Court of Appeals (CA) in CA-G.R. CV No. 86983,
and the Resolution2 dated October 23, 2007 denying petitioner's Motion for Reconsideration.3
The factual and procedural antecedents are as follows:
Elenita Dinglasan (Elenita) was the registered owner of a parcel of land designated as Lot No. 625 of the Limay Cadastre which is covered
by Transfer Certificate of Title (TCT) No. T-105602, with an aggregate area of 82,972 square meters. While on board a jeepney, Elenita’s
mother, Lilia Baluyot (Lilia), had a conversation with one Maura Passion (Maura) regarding the sale of the said property. Believing that
Maura was a real estate agent, Lilia borrowed the owner’s copy of the TCT from Elenita and gave it to Maura. Maura then subdivided the
property into several lots from Lot No. 625-A to Lot No. 625-O, under the name of Elenita and her husband Felicisimo Dinglasan
(Felicisimo).
Through a falsified deed of sale bearing the forged signature of Elenita and her husband Felicisimo, Maura was able to sell the lots to
different buyers. On April 26, 1990, Maura sold Lot No. 625-K to one Lorna Ong (Lorna), who later caused the issuance of TCT No. 134932
for the subject property under her name. A few months later, or sometime in August 1990, Lorna sold the lot to petitioner Editha Padlan
for ₱4,000.00. Thus, TCT No. 134932 was cancelled and TCT No. 137466 was issued in the name of petitioner.
After learning what had happened, respondents demanded petitioner to surrender possession of Lot No. 625-K, but the latter refused.
Respondents were then forced to file a case before the Regional Trial Court (RTC) of Balanga, Bataan for the Cancellation of Transfer
Certificate of Title No. 137466, docketed as Civil Case No. 438-ML. Summons was, thereafter, served to petitioner through her mother,
Anita Padlan.
On December 13, 1999, respondents moved to declare petitioner in default and prayed that they be allowed to present evidence ex
parte.4
On January 17, 2000, petitioner, through counsel, filed an Opposition to Declare Defendant in Default with Motion to Dismiss Case for
Lack of Jurisdiction Over the Person of Defendant.5 Petitioner claimed that the court did not acquire jurisdiction over her, because the
summons was not validly served upon her person, but only by means of substituted service through her mother. Petitioner maintained
that she has long been residing in Japan after she married a Japanese national and only comes to the Philippines for a brief vacation once
every two years.
On April 5, 2001, Charlie Padlan, the brother of petitioner, testified that his sister is still in Japan and submitted a copy of petitioner’s
passport and an envelope of a letter that was allegedly sent by his sister. Nevertheless, on April 5, 2001, the RTC issued an Order6 denying
petitioner’s motion to dismiss and declared her in default. Thereafter, trial ensued.
On July 1, 2005, the RTC rendered a Decision7 finding petitioner to be a buyer in good faith and, consequently, dismissed the complaint.
Not satisfied, respondents sought recourse before the CA, docketed as CA-G.R. No. CV No. 86983.
On June 29, 2007, the CA rendered a Decision8 in favor of the respondent. Consequently, the CA reversed and set aside the Decision of the
RTC and ordered the cancellation of the TCT issued in the name of Lorna and the petitioner, and the revival of respondents’ own title, to
wit:
WHEREFORE, in view of the foregoing, the Decision dated July
1, 2005 of the Regional Trial Court, Third Judicial Region, Branch 4, Mariveles, Bataan (Stationed in Balanga, Bataan) in Civil Case No. 438-
ML is hereby REVERSED and SET ASIDE.
The Transfer Certificate of Title No. 134932 issued in the name of Lorna Ong and Transfer Certificate of Title No. 137466 issued in the
name of defendant-appellee Editha Padlan are CANCELLED and Transfer Certificate of Title No. 134785 in the name of the plaintiffs-
appellants is REVIVED.
SO ORDERED.9
The CA found that petitioner purchased the property in bad faith from Lorna. The CA opined that although a purchaser is not expected to
go beyond the title, based on the circumstances surrounding the sale, petitioner should have conducted further inquiry before buying the
disputed property. The fact that Lorna bought a 5,000-square-meter property for only ₱4,000.00 and selling it after four months for the
same amount should have put petitioner on guard. With the submission of the Judgment in Criminal Case No. 4326 rendered by the RTC,
Branch 2, Balanga, Bataan, entitled People of the Philippines v. Maura Passion10 and the testimonies of respondents, the CA concluded
that respondents sufficiently established that TCT No. 134932 issued in the name of Lorna and TCT No. 137466 issued in the name of
petitioner were fraudulently issued and, therefore, null and void.
Aggrieved, petitioner filed a Motion for Reconsideration. Petitioner argued that not only did the complaint lacks merit, the lower court
failed to acquire jurisdiction over the subject matter of the case and the person of the petitioner.
On October 23, 2007, the CA issued a Resolution11 denying the motion. The CA concluded that the rationale for the exception made in the
landmark case of Tijam v. Sibonghanoy12 was present in the case. It reasoned that when the RTC denied petitioner’s motion to dismiss the
case for lack of jurisdiction, petitioner neither moved for a reconsideration of the order nor did she avail of any remedy provided by the
Rules. Instead, she kept silent and only became interested in the case again when the CA rendered a decision adverse to her claim.
Hence, the petition assigning the following errors:
I
WHETHER OR NOT THE HONORABLE COURT HAS JURISDICTION OVER THE PERSON OF THE PETITIONER.
II
WHETHER OR NOT THE HONORABLE COURT HAS JURISDICTION OVER THE SUBJECT MATTER OF THE CASE.
III
WHETHER OR NOT PETITIONER IS A BUYER IN GOOD FAITH AND FOR VALUE.13
Petitioner maintains that the case of Tijam v. Sibonghanoy finds no application in the case at bar, since the said case is not on all fours
with the present case. Unlike in Tijam, wherein the petitioner therein actively participated in the proceedings, petitioner herein asserts
that she did not participate in any proceedings before the RTC because she was declared in default.
Petitioner insists that summons was not validly served upon her, considering that at the time summons was served, she was residing in
Japan. Petitioner contends that pursuant to Section 15, Rule 14 of the Rules of Civil Procedure, when the defendant does not reside in the
Philippines and the subject of the action is property within the Philippines of the defendant, service may be effected out of the Philippines
by personal service or by publication in a newspaper of general circulation. In this case, summons was served only by substituted service
to her mother. Hence, the court did not acquire jurisdiction over her person.
Also, petitioner posits that the court lacks jurisdiction of the subject matter, considering that from the complaint, it can be inferred that
the value of the property was only ₱4,000.00, which was the amount alleged by respondents that the property was sold to petitioner by
Lorna.
Finally, petitioner stresses that she was a buyer in good faith. It was Maura who defrauded the respondents by selling the property to
Lorna without their authority.
Respondents, on the other hand, argue that the CA was correct in ruling in their favor.
The petition is meritorious.
Respondents filed the complaint in 1999, at the time Batas Pambansa Blg. (BP) 129, the Judiciary Reorganization Act of 1980, was already
amended by Republic Act (RA) No. 7691, An Act Expanding the Jurisdiction of the Metropolitan Trial Courts, Municipal Trial Courts, and
Municipal Circuit Trial Courts, amending for the purpose BP Blg. 129.14
Section 1 of RA 7691, amending BP Blg. 129, provides that the RTC shall exercise exclusive original jurisdiction on the following actions:
Section 1. Section 19 of Batas Pambansa Blg. 129, otherwise known as the "Judiciary Reorganization Act of 1980," is hereby amended to
read as follows:
Sec. 19. Jurisdiction in civil cases. – Regional Trial Courts shall exercise exclusive original jurisdiction:
(1) In all civil actions in which the subject of the litigation is incapable of pecuniary estimation;
(2) In all civil actions which involve the title to, or possession of, real property, or any interest therein, where the assessed
value of the property involved exceeds Twenty Thousand Pesos (₱20,000.00) or for civil actions in Metro Manila, where such
value exceeds Fifty Thousand Pesos (₱50,000.00), except actions for forcible entry into and unlawful detainer of lands or
buildings, original jurisdiction over which is conferred upon the Metropolitan Trial Courts, Municipal Trial Courts, and
Municipal Circuit Trial Courts; x x x
Section 3 of RA 7691 expanded the exclusive original jurisdiction of the first level courts, thus:
Section 3. Section 33 of the same law BP Blg. 129 is hereby amended to read as follows:
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial Courts in Civil Cases. – Metropolitan
Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts shall exercise:
xxxx
(3) Exclusive original jurisdiction in all civil actions which involve title to, or possession of, real property, or any interest therein where the
assessed value of the property or interest therein does not exceed Twenty Thousand Pesos (₱20,000.00) or, in civil actions in Metro
Manila, where such assessed value does not exceed Fifty Thousand Pesos (₱50,000.00) exclusive of interest, damages of whatever kind,
attorney's fees, litigation expenses and costs: Provided, That in cases of land not declared for taxation purposes, the value of such
property shall be determined by the assessed value of the adjacent lots.
Respondents filed their Complaint with the RTC; hence, before proceeding any further with any other issues raised by the petitioner, it is
essential to ascertain whether the RTC has jurisdiction over the subject matter of this case based on the above-quoted provisions.
However, in order to determine which court has jurisdiction over the action, an examination of the complaint is essential. Basic as a
hornbook principle is that jurisdiction over the subject matter of a case is conferred by law and determined by the allegations in the
complaint which comprise a concise statement of the ultimate facts constituting the plaintiff's cause of action. The nature of an action, as
well as which court or body has jurisdiction over it, is determined based on the allegations contained in the complaint of the plaintiff,
irrespective of whether or not the plaintiff is entitled to recover upon all or some of the claims asserted therein. The averments in the
complaint and the character of the relief sought are the ones to be consulted. Once vested by the allegations in the complaint, jurisdiction
also remains vested irrespective of whether or not the plaintiff is entitled to recover upon all or some of the claims asserted therein.15
What determines the jurisdiction of the court is the nature of the action pleaded as appearing from the allegations in the complaint. The
averments therein and the character of the relief sought are the ones to be consulted.16
Respondents’ Complaint17 narrates that they are the duly registered owners of Lot No. 625 of the Limay Cadastre which was covered by
TCT No. T-105602. Without their knowledge and consent, the land was divided into several lots under their names through the fraudulent
manipulations of Maura. One of the lots was Lot 625-K, which was covered by TCT No. 134785. On April 26, 1990, Maura sold the subject
lot to Lorna. By virtue of the fictitious sale, TCT No. 134785 was cancelled and TCT No. 134932 was issued in the name of Lorna. Sometime
in August 1990, Lorna sold the lot to petitioner for a consideration in the amount of ₱4,000.00. TCT No. 134932 was later cancelled and
TCT No. 137466 was issued in the name of petitioner. Despite demands from the respondents, petitioner refused to surrender possession
of the subject property. Respondents were thus constrained to engage the services of a lawyer and incur expenses for litigation.
Respondents prayed for the RTC (a) to declare TCT No. 137466 null and to revive TCT No. T-105602 which was originally issued and
registered in the name of the respondents; and (b) to order petitioner to pay attorney’s fees in the sum of ₱50,000.00 and litigation
expenses of ₱20,000.00, plus cost of suit.18
An action "involving title to real property" means that the plaintiff's cause of action is based on a claim that he owns such property or that
he has the legal rights to have exclusive control, possession, enjoyment, or disposition of the same. Title is the "legal link between (1) a
person who owns property and (2) the property itself." "Title" is different from a "certificate of title" which is the document of ownership
under the Torrens system of registration issued by the government through the Register of Deeds. While title is the claim, right or interest
in real property, a certificate of title is the evidence of such claim.19
In the present controversy, before the relief prayed for by the respondents in their complaint can be granted, the issue of who between
the two contending parties has the valid title to the subject lot must first be determined before a determination of who between them is
legally entitled to the certificate of title covering the property in question.1âwphi1
From the Complaint, the case filed by respondent is not simply a case for the cancellation of a particular certificate of title and the revival
of another. The determination of such issue merely follows after a court of competent jurisdiction shall have first resolved the matter of
who between the conflicting parties is the lawful owner of the subject property and ultimately entitled to its possession and enjoyment.
The action is, therefore, about ascertaining which of these parties is the lawful owner of the subject lot, jurisdiction over which is
determined by the assessed value of such lot.20
In no uncertain terms, the Court has already held that a complaint must allege the assessed value of the real property subject of the
complaint or the interest thereon to determine which court has jurisdiction over the action.21In the case at bar, the only basis of valuation
of the subject property is the value alleged in the complaint that the lot was sold by Lorna to petitioner in the amount of ₱4,000.00. No
tax declaration was even presented that would show the valuation of the subject property. In fact, in one of the hearings, respondents’
counsel informed the court that they will present the tax declaration of the property in the next hearing since they have not yet obtained
a copy from the Provincial Assessor’s Office.22 However, they did not present such copy.
To reiterate, where the ultimate objective of the plaintiffs is to obtain title to real property, it should be filed in the proper court having
jurisdiction over the assessed value of the property subject thereof.23 Since the amount alleged in the Complaint by respondents for the
disputed lot is only ₱4,000.00, the MTC and not the RTC has jurisdiction over the action. Therefore, all proceedings in the RTC are null and
void.24
Consequently, the remaining issues raised by petitioner need not be discussed further.
WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals in CA-G.R. CV No. 86983, dated June 29, 2007, and its
Resolution dated October 23, 2007, are REVERSED and SET ASIDE. The Decision of the Regional Trial Court, dated July I, 2005, is declared
NULL and VOID. The complaint in Civil Case No. 438-ML is dismissed without prejudice.
SO ORDERED.
DISDADO M. PERALTA
Associate Justice
WE CONCUR:
PRESBITERO J. VELASCO, JR.
Associate Justice
Chairperson
G.R. No. 150325 August 31, 2006
EDGARDO V. QUESADA, Petitioner,
vs.
THE DEPARTMENT OF JUSTICE and CLEMENTE TERUEL, Respondents.
DECISION
SANDOVAL-GUTIERREZ, J.:
For our resolution is the Petition for Certiorari 1 (with prayer for a temporary restraining order and/or preliminary injunction) assailing the
Resolutions dated January 17, 2001 and September 17, 2001 issued by the Secretary of Justice in I.S. No. 00-29780-C, entitled "Clemente
M. Teruel, complainant, versus Ramon P. Camacho, Jr., Edgardo V. Quesada and Rodolfo Corgado, respondents."
On March 1, 2000, Clemente M. Teruel, herein respondent, filed with the Office of the City Prosecutor, Mandaluyong City, an affidavit-
complaint 2 charging Edgardo V. Quesada (herein petitioner), Ramon P. Camacho, Jr., and Rodolfo Corgado with the crime of estafa under
Article 315, paragraphs 2 and 3 of the Revised Penal Code, docketed as I.S. No. 00-29780-C. The affidavit-complaint alleges that on June
13, 1998 at Shangrila Plaza Hotel, EDSA, Mandaluyong City, Quesada, Camacho, and Corgado represented themselves to Teruel as the
president, vice-president/treasurer, and managing director, respectively, of VSH Group Corporation; that they offered to him a
telecommunication device called Star Consultant Equipment Package which provides the user easy access to the internet via television;
that they assured him that after he pays the purchase price of P65,000.00, they will immediately deliver to him two units of the internet
access device; that relying on their representations, he paid them P65,000.00 for the two units; and that despite demands, they, did not
deliver to him the units.
It was only petitioner Quesada who filed a counter-affidavit. 3 He alleged that he, Camacho, and Corgado are Star Consultant Trainers of
F.O.M. Philippines, Inc., a corporation engaged in the business of selling and marketing telecommunication products and technologies;
that they formed the VSH Group as a corporation "for the principal purpose of pooling the commissions they will receive as Star
Consultant Trainers and then dividing said commissions among themselves according to their agreement"; that while he admitted that the
two units of internet access devices purchased by herein respondent Teruel were not delivered to him, however, this was not due to their
alleged fraudulent representations since they merely acted as sales agents of F.O.M. Phils., Inc.; and that they found out too late that the
said company could not cope with its commitment to them as it ran short of supplies of telecommunication products.
On April 25, 2000, Assistant City Prosecutor Esteban A. Tacla, Jr. issued a Resolution 4 finding probable cause against petitioner Quesada,
Camacho, and Corgado, and recommending the filing of the corresponding Information.
Consequently, an Information for estafa against petitioner Quesada, Camacho, and Corgado was filed with the Regional Trial Court (RTC),
Mandaluyong City, docketed as Criminal Case No. MC-00-2510. This case was later raffled off to Branch 208.
In the meantime, petitioner filed with the Department of Justice a Petition for Review challenging the April 25, 2000 Resolution of the
Investigating Prosecutor. On January 17, 2001, the Secretary of Justice issued a Resolution 5dismissing the petition. Petitioner’s motion for
reconsideration was denied in a Resolution 6 dated September 17, 2001.
While the RTC was hearing Criminal Case No. MC-00-2510, petitioner filed with this Court the instant Petition for Certiorari alleging that
the Secretary of Justice, in dismissing his Petition for Review in I.S. No. 00-29780-C, acted with grave abuse of discretion amounting to lack
or excess of jurisdiction. Petitioner contends that the element of fraud or deceit in the crime of estafa is not present 7 and that there is no
evidence which will prove that the accused’s promise to deliver the purchased items was false or made in bad faith. 8
The Solicitor General, in his Comment, maintains that the Secretary of Justice, in finding a probable cause against the three accused, did
not act with grave abuse of discretion and prayed for the dismissal of the instant petition for being unmeritorious.
Initially, we observe that the present petition was directly filed with this Court, in utter violation of the rule on hierarchy of courts.
A petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure, as amended, must be filed with the Court of Appeals whose
decision may then be appealed to this Court by way of a petition for review on certiorari under Rule 45 of the same Rules. 9 A direct
recourse to this Court is warranted only where there are special and compelling reasons specifically alleged in the petition to justify such
action. Such ladder of appeals is in accordance with the rule on hierarchy of courts. In Vergara, Sr. v. Suelto, 10 we stressed that this should
be the constant policy that must be observed strictly by the courts and lawyers, thus:
x x x. The Supreme Court is a court of last resort, and must so remain if it is to satisfactorily perform the functions assigned to it by the
fundamental charter and immemorial tradition. It cannot and should not be burdened with the task of dealing with causes in the first
instance. Its original jurisdiction to issue the so-called extraordinary writs should be exercised only where absolutely necessary or where
serious and important reasons exist therefor. Hence, that jurisdiction should generally be exercised relative to actions or proceedings
before the Court of Appeals, or before constitutional or other tribunals, bodies or agencies whose acts for some reason or another are not
controllable by the Court of Appeals. Where the issuance of an extraordinary writ is also within the competence of the Court of Appeals or
a Regional Trial Court, it is in either of these courts that the specific action for the writ’s procurement must be presented. This is and
should continue to be the policy in this regard, a policy that courts and lawyers must strictly observe. (Underscoring supplied)
We later reaffirmed such policy in People v. Cuaresma 11 after noting that there is "a growing tendency on the part of litigants and lawyers
to have their applications for the so-called extraordinary writs, and sometimes even their appeals, passed upon and adjudicated directly
and immediately by the highest tribunal of the land." We again emphasized that:
x x x. This Court’s original jurisdiction to issue writs of certiorari (as well as prohibition, mandamus, quo warranto, habeas corpus and
injunction) is not exclusive. x x x. It is also shared by this Court, and by the Regional Trial Court, with the Court of Appeals x x x. This
concurrence of jurisdiction is not, however, to be taken as according to parties seeking any of the writs an absolute, unrestrained freedom
of choice of the court to which application therefor will be directed. There is, after all, a hierarchy of courts. That hierarchy is
determinative of the venue of appeals, and should also serve as a general determinant of the appropriate forum for petitions for the
extraordinary writs. A becoming regard for that judicial hierarchy most certainly indicates that petitions for the issuance of extraordinary
writs against first level courts should be filed with the Regional Trial Court, and those against the latter, with the Court of Appeals. A direct
invocation of the Supreme Court’s original jurisdiction to issue these writs should be allowed only when there are special and important
reasons therefor, clearly and specifically set out in the petition. This is established policy. It is a policy that is necessary to prevent
inordinate demands upon the Court’s time and attention which are better devoted to those matters within its exclusive jurisdiction, and
to prevent further over-crowding of the Court’s docket. x x x. (Underscoring supplied)
Here, we cannot discern any special and compelling reason to justify the direct filing with this Court of the present petition. Clearly, it
should be dismissed outright.
Even assuming that the petition can be filed directly with this Court, the same must fail. Petitioner contends that the element of fraud or
deceit as an element of the crime of estafa is absent. Consequently, the affirmance by the Secretary of Justice of the Investigating
Prosecutor’s finding that there exists a probable cause is tainted with grave abuse of discretion.
The issue of whether the element of fraud or deceit is present is both a question of fact and a matter of defense, the determination of
which is better left to the trial court after the parties shall have adduced their respective evidence. It bears stressing that a preliminary
investigation is merely an inquiry or proceeding to determine whether there is sufficient ground to engender a well-founded belief that a
crime has been committed and that the respondent is probably guilty thereof, and should be held for trial. 12 It does not call for the
application of rules and standards of proof that a judgment of conviction requires after trial on the merits. 13 As implied by the words
"probably guilty," the inquiry is concerned merely with probability, not absolute or moral certainty. 14 At this stage, the complainant need
not present proof beyond reasonable doubt. A preliminary investigation does not require a full and exhaustive presentation of the parties’
evidence. 15 A finding of probable cause needs only to rest on evidence showing that more likely than not, a crime has been committed
and was committed by petitioner and his co-accused. As ruled by the Investigating Prosecutor and affirmed by the Secretary of Justice,
petitioner’s representation and assurance to respondent Teruel that the telecommunication equipment would be delivered to him upon
payment of its purchase price was the compelling reason why he parted with his money. Such assurance, the Investigating Prosecutor
added, is actually a misrepresentation or deceit.
Thus, we hold that the Secretary of Justice did not gravely abuse his discretion. An act of a court or tribunal may only be considered as
committed in grave abuse of discretion when the same was performed in a capricious or whimsical exercise of judgment which is
equivalent to lack of jurisdiction. The abuse of discretion must be patent and gross as to amount to an evasion of positive duty or to a
virtual refusal to perform a duty enjoined by law or to act at all in contemplation of law, as where the power is exercised in an arbitrary
and despotic manner by reason of passion or personal hostility. 16
WHEREFORE, we DISMISS the instant petition. Costs against petitioner.
SO ORDERED.
ANGELINA SANDOVAL-GUTIERREZ
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Associate Justice
Chairperson
G.R. No. 155713 May 5, 2006
MILAGROS G. LUMBUAN,* Petitioner,
vs.
ALFREDO A. RONQUILLO, Respondent.
DECISION
QUISUMBING, J.:
This petition for review on certiorari seeks to reverse and set aside the Decision1 dated April 12, 2002, of the Court of Appeals in CA-G.R.
SP No. 52436 and its Resolution2 dated October 14, 2002, denying the petitioner’s motion for reconsideration.
The salient facts, as found by the Court of Appeals,3 are as follows:
Petitioner Milagros G. Lumbuan is the registered owner of Lot 19-A, Block 2844 with Transfer Certificate of Title No. 193264, located in
Gagalangin, Tondo, Manila. On February 20, 1995, she leased it to respondent Alfredo A. Ronquillo for a period of three years with a
monthly rental of P5,000. The parties also agreed that there will be a 10% annual increase in rent for the succeeding two years, i.e., 1996
and 1997,4 and the leased premises will be used exclusively for the respondent’s fastfood business, unless any other use is given, with the
petitioner’s prior written consent.5
While the respondent at the start operated a fastfood business, he later used the premises as residence without the petitioner’s prior
written consent. He also failed to pay the 10% annual increase in rent of P500/month starting 1996 and P1,000/month in 1997 to the
present. Despite repeated verbal and written demands, the respondent refused to pay the arrears and vacate the leased premises.
On November 15, 1997, the petitioner referred the matter to the Barangay Chairman’s office but the parties failed to arrive at a
settlement. The Barangay Chairman then issued a Certificate to File Action.6
On December 8, 1997, the petitioner filed against the respondent an action for Unlawful Detainer, docketed as Civil Case No. 157922-CV.
It was raffled to the Metropolitan Trial Court (MeTC) of Manila, Branch 6. On December 15, 1997, the respondent received the summons
and copy of the complaint. On December 24, 1997, he filed his Answer by mail. Before the MeTC could receive the respondent’s Answer,
the petitioner filed a Motion for Summary Judgment dated January 7, 1998.7 Acting upon this motion, the MeTC rendered a decision8 on
January 15, 1998, ordering the respondent to vacate and surrender possession of the leased premises; to pay the petitioner the amount
of P46,000 as unpaid rentals with legal interest until fully paid; and to pay the petitioner P5,000 as attorney’s fees plus cost of the suit.
The respondent then filed a Manifestation calling the attention of the MeTC to the fact that his Answer was filed on time and praying that
the decision be set aside. The MeTC denied the prayer, ruling that the Manifestation was in the nature of a motion for reconsideration
which is a prohibited pleading under the Rules on Summary Procedure.
Upon appeal, the case was raffled to the Regional Trial Court (RTC) of Manila, Branch 38, and docketed as Civil Case No. 98-87311. On July
8, 1998, the RTC rendered its decision9 setting aside the MeTC decision. The RTC directed the parties to go back to the Lupon Chairman or
Punong Barangay for further proceedings and to comply strictly with the condition that should the parties fail to reach an amicable
settlement, the entire records of the case will be remanded to MeTC of Manila, Branch 6, for it to decide the case anew.
The respondent sought reconsideration but the RTC denied the motion in an Order dated March 15, 1999. Thus, he sought relief from the
Court of Appeals through a petition for review.10 On April 12, 2002, the appellate court promulgated a decision, reversing the decision of
the RTC and ordering the dismissal of the ejectment case. The appellate court ruled that when a complaint is prematurely instituted, as
when the mandatory mediation and conciliation in the barangay level had not been complied with, the court should dismiss the case and
not just remand the records to the court of origin so that the parties may go through the prerequisite proceedings.
The petitioner filed a motion for reconsideration, which was denied by the appellate court. Hence, this present petition.
In the meantime, while this petition was pending before this Court, the parties went through barangay conciliation proceedings as
directed by the RTC of Manila, Branch 38. Again, they failed to arrive at an amicable settlement prompting the RTC to issue an
Order11 remanding the case to the MeTC of Manila, Branch 6, where the proceedings took place anew. On April 25, 2000, the MeTC
rendered a second decision, the dispositive portion of which reads:
WHEREFORE, premises considered, judgment on the merits is hereby rendered for the plaintiff as follows:
 1. Ordering defendant and all persons claiming right of possession under him to voluntarily vacate the property located at Lot
19-A Block 2844, Gagalangin, Tondo, Manila and surrender possession thereof to the plaintiff;
2. Ordering defendant to pay to plaintiff the amount of P387,512.00 as actual damages in the form of unpaid rentals and its
agreed increase up to January 2000 and to pay the amount of P6,500.00 a month thereafter until the same is actually vacated;
3. Ordering the defendant to pay to plaintiff the sum of P10,000.00 as and for attorney’s fees plus cost of the suit.
SO ORDERED.12
The respondent appealed the foregoing decision.1avvphil.net The case was raffled to RTC of Manila, Branch 22, and docketed as Civil Case
No. 00-98173. The RTC ruled in favor of the petitioner and dismissed the appeal. The respondent elevated the case to the Court of
Appeals, where it is now pending.
The sole issue for our resolution is:
[WHETHER] THE COURT OF APPEALS GRAVELY ERRED IN DISMISSING THE COMPLAINT FOR THE ALLEGED FAILURE OF THE PARTIES TO
COMPLY WITH THE MANDATORY MEDIATION AND CONCILIATION PROCEEDINGS IN THE BARANGAY LEVEL.13
With the parties’ subsequent meeting with the Lupon Chairman or Punong Barangay for further conciliation proceedings, the procedural
defect was cured. Nevertheless, if only to clear any lingering doubt why the Court of Appeals erred in dismissing the complaint, we shall
delve on the issue.
The petitioner alleges that the parties have gone through barangay conciliation proceedings to settle their dispute as shown by the
Certificate to File Action issued by the Lupon/Pangkat Secretary and attested by the Lupon/Pangkat Chairman. The respondent, on the
other hand, contends that whether there was defective compliance or no compliance at all with the required conciliation, the case should
have been dismissed.
The primordial objective of the Katarungang Pambarangay Rules,14 is to reduce the number of court litigations and prevent the
deterioration of the quality of justice which has been brought about by the indiscriminate filing of cases in the courts. To attain this
objective, Section 412(a) of Republic Act No. 716015 requires the parties to undergo a conciliation process before the Lupon Chairman or
the Pangkat as a precondition to filing a complaint in court,16thus:
SECTION 412. Conciliation. – (a) Pre-condition to Filing of Complaint in Court. – No complaint, petition, action, or proceeding involving any
matter within the authority of the lupon shall be filed or instituted directly in court or any other government office for adjudication,
unless there has been a confrontation between the parties before the lupon chairman or the pangkat, and that no conciliation or
settlement has been reached as certified by the lupon secretary or pangkat secretary as attested to by the lupon or pangkat chairman….
Here, the Lupon/Pangkat Chairman and Lupon/Pangkat Secretary signed the Certificate to File Action stating that no settlement was
reached by the parties. While admittedly no pangkat was constituted, it was not denied that the parties met at the office of the Barangay
Chairman for possible settlement. The efforts of the Barangay Chairman, however, proved futile as no agreement was reached. Although
no pangkat was formed, in our mind, there was substantial compliance with the law. It is noteworthy that under the aforequoted
provision, the confrontation before the Lupon Chairman or the pangkat is sufficient compliance with the precondition for filing the case in
court.17 This is true notwithstanding the mandate of Section 410(b) of the same law that the Barangay Chairman shall constitute
a pangkat if he fails in his mediation efforts. Section 410(b) should be construed together with Section 412, as well as the circumstances
obtaining in and peculiar to the case. On this score, it is significant that the Barangay Chairman or Punong Barangay is herself the
Chairman of the Lupon under the Local Government Code.18
Finally, this Court is aware that the resolution of the substantial issues in this case is pending with the Court of Appeals. While ordinarily,
we would have determined the validity of the parties’ substantial claims since to await the appellate court’s decision will only frustrate
speedy justice and, in any event, would be a futile exercise, as in all probability the case would end up with this Court, we find that we
cannot do so in the instant case.
It must be underscored that supervening events have taken place before the lower courts where the parties have been adequately heard,
and all the issues have been ventilated. Since the records of those proceedings are with the Court of Appeals, it is in a better position to
fully adjudicate the rights of the parties. To rely on the records before this Court would prevent us from rendering a sound judgment in
this case. Thus, we are left with no alternative but to leave the matter of ruling on the merits to the appellate court.
WHEREFORE, the petition is GRANTED. The decision and resolution of the Court of Appeals in CA-G.R. SP No. 52436
are REVERSED and SET ASIDE, and the decision of the Regional Trial Court of Manila, Branch 38, in Civil Case No. 98-87311 is AFFIRMED.
The Court of Appeals is ordered to proceed with the appeal in CA – G.R. No. 73453 and decide the case with dispatch.
SO ORDERED.
LEONARDO A. QUISUMBING
Associate Justice
WE CONCUR:
ANTONIO T. CARPIO CONCHITA CARPIO MORALES
Associate Justice Asscociate Justice
DANTE O. TINGA
Associate Justice
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. ULYSSES M. CAWALING, ERNESTO TUMBAGAHAN, RICARDO DE LOS SANTOS, and
HILARIO CAJILO, accused-appellants.
DECISION
PANGANIBAN, J.:
It is axiomatic that once an accused-appellant admits killing the victim, he bears the burden of establishing the presence of any
circumstance like self-defense, performance of a lawful duty or, for that matter, double jeopardy, which may relieve him of responsibility,
or which may mitigate his criminal liability.[1] If he fails to discharge this burden, his conviction becomes inevitable. In this Decision, we
also reiterate the following doctrines: (1) the regional trial court, not the Sandiganbayan, has jurisdiction over informations for murder
committed by public officers, including a town mayor; (2) the assessment of trial courts on the credibility of witnesses and their
testimonies deserve great respect; (3) the equipoise rule cannot be invoked where the evidence of the prosecution is overwhelming; (4)
alibi cannot be believed in the face of credible testimony identifying the appellants; and (5) conspiracy may be proven by circumstantial
evidence.
The Case
Before us is an appeal from the 34-page Decision[2] dated October 21, 1994, promulgated by the Regional Trial Court of Romblon in
Criminal Case No. OD-269. Convicted of murder were former Mayor Ulysses M. Cawaling and Policemen Ernesto Tumbagahan,[3] Ricardo
De los Santos and Hilario Cajilo.
Prior to the institution of the criminal case against all the appellants, an administrative case[4] had been filed before the National
Police Commission, in which Policemen Ernesto Tumbagahan, Ricardo De los Santos, Hilario Cajilo (three of herein appellants) and Andres
Fontamillas were charged by Nelson Ilisan[5] with the killing of his brother Ronie[6] Ilisan. On April 6, 1986, Adjudication Board No.
14[7] rendered its Decision which found Tumbagahan, De los Santos, Cajilo and Fontamillas guilty of grave misconduct and ordered their
dismissal from the service with prejudice.[8] On June 26, 1986, the Board issued a resolution,[9] dismissing the respondents motion for
reconsideration for lack of merit.
Subsequently, on June 4, 1987, Second Assistant Provincial Fiscal Alexander Mortel filed, before the Regional Trial Court (RTC) of
Odiongan, Romblon,[10] an Information for murder[11]against the appellants and Andres Fontamillas. The accusatory portion reads:
That on or about the 4th day of December 1982, at around 9:00 oclock in the evening, in the Poblacion, [M]unicipality of San Jose,
[P]rovince of Romblon, Philippines, and within the jurisdiction of this Honorable Court, the said accused, with intent to kill, conspiring,
confederating and mutually helping one another, did then and there, by means of treachery and with evident premeditation and taking
advantage of their superior strenght [sic] willfully, unlawfully and feloniously attack, assault and shoot RONIE ILISAN, with the use of
firearms, inflicting upon the latter multiple mortal injuries in different parts of his body which were the direct and immediate cause of his
death.
Accused Tumbagahan, De los Santos, Cajilo and Fontamillas, with the assistance of their lawyers Atty. Abelardo V. Calsado and
Juanito Dimaano, pleaded not guilty when arraigned on February 15, 1988;[12] while Accused Cawaling, assisted by Counsel Jovencio Q.
Mayor, entered a plea of not guilty on March 16, 1988.[13]
After due trial,[14] the court a quo[15] rendered its Decision dated October 21, 1994,[16] the decretal portion of which reads:
WHEREFORE, this Court finds the accused (1) ULYSSES M. CAWALING, (2) ERNESTO TUMBAGAHAN, (3) RICARDO DELOS SANTOS, (4)
HILARIO CAJILO, AND (5) ANDRES FONTAMILLAS GUILTY beyond reasonable doubt of the crime of MURDER under the Information, dated
June 4, 1987, and sentences each of them to suffer the penalty of reclusion perpetua, with the accessory penalties of the law.
The accused, jointly and severally, are ORDERED to pay Nelson Elisan the sum of P6,000.00 as actual damages and the heirs of the
deceased Ronie Elisan the sums of P116,666.66 by way of lost earnings and P50,000.00 as indemnity for death, without subsidiary
imprisonment in case of insolvency, and to pay the costs.
The bail bonds of all the accused are ORDERED CANCELLED and all said accused are ORDERED immediately confined in jail.
The slug (Exh. A); the .38 caliber revolver (with 3 empty shells and 3 live bullets) (Exh. G); and the slug of bullet (Exh. H) are confiscated in
favor of the government.
After the judgment has become final, the Officer-in-Charge, Office of the Clerk of Court, this Court, is ordered to deliver and deposit the
foregoing Exhibits A, F, G and H, inclusive, to the Provincial Director, PNP, of the Province of Romblon properly receipted. Thereafter, the
receipt must be attached to the record of the case and shall form part of the record.
The period of preventive imprisonment the accused had undergone shall be credited in their favor to its full extent pursuant to Article 29
of the Revised Penal Code, as amended.
The case against co-accused ALEX BATUIGAS who is at large is ORDERED ARCHIVED pending his arrest.[17]
Hence, this appeal.[18]
The Facts
Version of the Prosecution
The trial court gives this summary of the facts as viewed by the prosecution witnesses:
The killing occurred on December 4, 1982 at around 9:00 oclock in the evening at the ricefield of Poblacion, San Jose, Romblon when the
bright moon was already above the sea at an angle of about 45 degrees, or if it was daytime, it was about 9:00 oclock in the morning
(Imelda Elisan Tumbagahon, on direct examination, tsn, Jan. 17, 1989, p. 5, and on cross examination, tsn, April 18, 1989, p. 22).
On December 4, 1982, about 8:00 oclock or 8:30 oclock in the evening, Vicente Elisan and his elder brother Ronie Elisan, the victim, were
drinking tuba at C & J-4 Kitchenette of co-accused Andres Fontamillas in Poblacion, San Jose, Romblon. When they stood up to go home,
Luz Venus, the wife of Diosdado Venus, told them not to go out because the accused were watching them outside about three (3) meters
from the restaurant. Diosdado Venus accompanied them upon their request and they went out and walked towards home. About a
hundred meters from the restaurant, the six (6) accused, that is, Mayor Cawaling, the four (4) policemen, namely, Hilario Cajilo, Andres
Fontamillas, Ernesto Tumbagahan and Ricardo delos Santos, and civilian Alex Batuigas, the mayors brother-in-law, flashlighted them and
Diosdado Venus ran going back. The two (2) brothers also ran towards home to the house of their elder sister Imelda Elisan
Tumbagahon. Co-accused Andres Fontamillas and Hilario Cajilo blocked them on the gate of the fence of their sisters house. Ronie Elisan
ran towards the ricefield. The accused were chasing them. Vicente Elisan saw his brother Ronie f[a]ll down on the ricefield while he ran
towards the bushes and la[y] on the ground. Ronie Elisan rose up by kneeling and raising his two (2) hands. All the six (6) accused
approached him with their flashlights and shot him. Ronie fell down about twenty (20) meters from the bushes where Vicente Elisan hid
behind the coconut tree. Co-accused Cawaling said []you left him, he is already dead.[] Mayor Cawaling was armed with .45 caliber,
policemen Andres Fontamillas and Hilario Cajilo were both with armalites, Ernesto Tumbagahan and Ricardo delos Santos were both with
.38 caliber and so with civilian Alex Batuigas. They left towards the house of Mayor Cawaling. After they were gone, Vicente Elisan ran
towards the house of his older brother Nelson Elisan. Upon seeing him, Vicente told Nelson that Ronie was already dead. Nelson said
nothing. While they were there, elder sister Imelda Elisan Tumbagahon, who was crying came. She said: Manong, patay ron si
Ronie. (Brother, Ronie is already dead). Nelson said []do not be noisy; they might come back and kill all of us.[] Imelda stopped crying.
After a while, brothers Nelson and Vicente Elisan went to the house of barangay captain Aldolfo Tumbagahon. The three (3) went to the
townhall and called the police but there was none there. Going to the house of the Chief of Police Oscar Montero, they were told by his
wife that Commander Montero was in the house of Mayor Cawaling. They proceeded to the place where Ronie Elisan was shot. The
cadaver was brought to the house of Nelson Elisan. Vicente Elisan found an empty shell of a .45 caliber about three (3) arms length from
the body of the victim. They surrendered it to the Napolcom.[19]
Dr. Blandino C. Flores described the gunshot wounds of the victim as follows:
Gunshot Wounds:
1. Shoulder:
Gun shot wound x inch in diameter shoulder right 2 inches from the neck with contussion [sic] collar s[u]rrounding the wound.
2. Right Axilla:
Gun shot wound x inch in diameter, 2 inches below the right nipple with contussion [sic] collar s[u]rrounding the wound.
3. Left Axilla:
Exit of the gun shot wound from the right axilla, measuring x inch with edges everted, one inch below the axilla and one inch below the
level of the nipple.
4. Back:
Gun shot wound measuring x inch, along the vertebral column, right at the level of the 10th ribs with contussion [sic]collar.
5. Leg, Left:
Gun shot wound measuring x anterior aspect upper third leg with contussion [sic] collar, with the exit x posterior aspect upper third leg,
left.[20]
Based on the death certificate (Exhibit E) issued by Dr. Flores, Ronie Ilisan died of severe hemorrhage and gun shot wo[unds].[21]
Version of the Defense
Appellant Cawaling, in his 47-page Brief,[22] presented his own narration of the incident as follows:
At around 7:00 in the evening of December 4, 1982, Ulysses Cawaling, then the mayor of the [M]unicipality of San Jose in the [P]rovince of
Romblon, arrived aboard a hired motorized boat from Manila in the seashore of San Jose. From the seashore, he immediately proceeded
to his home. At around 7:30 in the evening, Cawaling went to the municipal hall to check on administrative matters that piled up in the
course of his trip to Manila. He also went inside the police station (located inside the municipal building) to be apprised of
any developments, afterwhich he went out and joined Pfc. Tumbagahan and Pfc. Cajilo who were standing near the flagpole in front of the
municipal building. The three engaged in a conversation. Cawaling learned that the two police officers were the ones assigned for
patrol/alert for that night. The three of them went inside the INP office and there Cawaling informed the two policemen that he received
information from reliable persons that certain persons were plotting to kill him and a member of the towns police force. It is to be noted
that this occurred at the height of the communist insurgency and political violence in the countryside in the early 80s. Hence, such
information was taken very seriously, having been relayed by sources independent of each other.
Cawaling, as town chief then empowered with supervisory authority over the local police, accompanied Pfc. Tumbagahan and Pfc. Cajilo in
conducting patrol and surveillance operations around the small municipality. He usually did this as routine since Romblon was then
plagued with political assassinations and armed conflict. On their way to the seashore, they passed by C & J-4 Kitchenette, and chanced
upon Ronnie Ilisan and his brother Vicente Ilisan drinking liquor and discussing in very loud voices. They stopped right in the front of the
restaurant and there they heard Ronnie Ilisan state in a every loud voice that he will kill a person that night. Inside the restaurant, without
the knowledge then of Cawaling and the two police officers, witness Gil Palacio, who was buying cigarettes and Luz Venus, the
cook/server of the restaurant, saw Ronnie Ilisan, very drunk, brandishing in the air a .38 caliber Smith and Wesson revolver with a
protruding screw.
Initially dismissing Ronnie Ilisans statement as just another hollow swagger of an intoxicated person (salitang lasing), Cawaling and the
two policemen proceeded on their way. After the patrol, they returned to the municipal building and stationed themselves in front. At
around 8:30 in the evening, Ronnie Elisan passed by the municipal hall walking towards the direction of the house of Nelson Ilisan,
another brother, and shouted the challenge, gawas ang maisog, meaning THOSE WHO ARE BRAVE, COME OUT. Cawaling and the two
police officers again brushed aside [the] challenge as just another foolish drunken revelry [o]n the part of Ronnie Ilisan, a well-known
troublemaker in the small municipality.
A few moments later, after Ronie Ilisan had passed by, they distinctly heard a gunshot and hysterical female voices shouting, pulis,
tabang meaning POLICE! HELP! four times. Impelled by the call of duty, Cawaling and the two policemen immediately ran in the direction
of the gunshot and the desperate female voices until they reached the house of Nelson Ilisan in San Jose Street. At this point, they saw
Ronnie Ilisan holding a .38 caliber revolver. They also saw Vicente Ilisan, Francisco Tesnado, Fe Ilisan, the wife of Nelson and Delma Ilisan,
the wife of Vicente, the latter two being the same persons who cried pulis, tabang four times. Cawaling then told Ronnie to surrender his
gun but the latter responded by pointing the gun at Cawaling and pulling the trigger.
At the precise moment that the gun fired, Cawaling warned the two policemen to drop to the ground by shouting dapa. Fortunately,
Cawaling was not hit. Ronnie Ilisan then turned around and ran towards the church. The two policemen gave chase. Cawaling, still shaken
and trembling after the mischance was initially left behind but followed shortly. When Ronnie Ilisan reached the church, he turned around
and again fired at the pursuing Pfc. Cajilo. Fortunately, the gun misfired. When they finally reached the ricefield, Pfc. Cajilo fired two (2)
warning shots in the air for Ronnie to surrender. Ronnie responded by firing once again at Pfc. Tumbagahan but failed to hit the latter. At
that instance, Pfc. Cajilo counter-fired at Ronnie Ilisan hitting him. Pfc. Tumbagahan also fired his weapon in the heat of exchange and also
hit Ronnie Ilisan. As a result of the gunshot wounds, Ronnie Ilisan later on succumbed.
Pfc. Tumbagahan picked up the gun still in the hand of the dead Ronnie Ilisan and gave it to Pfc. Cajilo. The three, Cawaling, who
subsequently caught up with them after the incident, and the two police officers, then proceeded to the police station located in the
municipal building to formally report the incident in their station blotter.[23]
The Brief for All of the Accused-Appellants filed by Atty. Napoleon U. Galit and the Brief for Appellants Ernesto Tumbagahan and
Hilario Cajilo submitted by Atty. Joselito R. Enriquez merely repeated the facts as narrated by the trial court.
Ruling of the Trial Court
Finding the prosecution witnesses and their testimonies credible, the court a quo convicted the appellants. The killing was qualified
to murder because of the aggravating circumstances of abuse of superior strength and treachery. The trial court ruled that there was a
notorious inequality of forces between the victim and his assailants, as the latter were greater in number and armed with guns. It further
ruled that abuse of superior strength absorbed treachery, as it ratiocinated:
Certain cases, an authority wrote, involving the killing of helpless victim by assailants superior to them in arms or numbers, or victims who
were overpowered before being killed, were decided on the theory that the killing was treacherous, when perhaps the correct qualifying
circumstance would be abuse of superiority. In these cases the attack was not sudden nor unexpected and the element of surprise was
lacking. (Id., I Aquino, pp. 423-424). In the instant case, we earlier ruled that the qualifying treachery should be considered as an exception
to the general rule on treachery because it was not present at the inception of the attack. The killing was not sudden nor unexpected and
the element of surprise was lacking. It is for this reason that we hold that alevosia should be deemed absorbed or included in abuse of
superiority. Even assuming ex-gratia argumenti that it should be the other way around, the situation will not be of help, penaltywise, to
the accused.[24]
The defenses raised by the appellants were dismissed and their witnesses declared unworthy of belief for the following reasons:
1. It was highly improbable that Defense Witness Tesnado would not tell his wife (Dory) and Bebelinia Ilisan Sacapao about the incident he
had allegedly witnessed; more so when Sacapao was the victims first cousin.
2. The spot report prepared by Station Commander Oscar M. Montero, the testimonies of Cajilo and Tumbagahan and the medical
findings of Dr. Flores contradicted one another on the following details: the caliber of the gun used in shooting the victim, the wounds
inflicted and the whereabouts of Cawaling during the shoot-out.
3. Cawaling and his men, armed with guns, could have immediately disarmed the victim at the initial encounter. The court could not
understand why the victim was able to fire his gun, run, then stop and again fire his gun, without being caught.
4. The positive identification made by the prosecution witnesses prevails over the alibi posed by De los Santos and Fontamillas, a defense
that was not corroborated by any other witness.
5. The .38 caliber revolver, allegedly owned by the victim, was in fact owned and used by Alex Batuigas.
6. The defense presented a photo and a sketch to prove that Imelda Ilisan Tumabagahan had an obstructed view of the killing. The trial
court ruled that such evidence was misleading, because the window, from where said witness allegedly saw the incident, was at the
eastern side of her house, and thus afforded a clear view of the incident, while the window referred to by the defense was at the southern
portion.
7. The questioned testimonies of Dr. Flores, Nelson Ilisan and Provincial Prosecutor Pedro Victoriano, Jr., though not formally offered as
evidence, may be admitted because of the failure of the defense to object thereto at the time they were called to testify.
8. The defense failed to prove that the prosecution witnesses had any ill motive to testify falsely against the appellant.
9. Appellants had a motive to kill the victim. Nelson Ilisan testified that his brother Ronie (the victim) had witnessed Bonifacio
Buenaventura (a former chief commander of the San Jose Police Force) kill a certain Ruben Ventura. Cawaling, who was Buenaventuras
first cousin, wanted Ronie dead, because the latter had not followed his instruction to leave town to prevent him from testifying in said
case.
Assignment of Errors
The appellants, through their common counsel, Atty. Napoleon Galit, assign the following errors to the lower court:
1. The trial court gravely erred in sustaining prosecutors theory of conspiracy and thus renders nugatory or has totally forgotten that
policemen when in actual call of duty normally operate in group but not necessarily in conspiracy.
2. The trial court gravely erred in believing the theory of the prosecution that accused-appellant Ulysses Cawaling was one of the alleged
co-conspirators in the killing of the deceased Ronnie Elisan.
3. The trial court gravely erred in not believing the defense of accused-appellant Ulysses Cawaling that he has nothing to do with the
shooting incident except to shout to arrest the accused[,] which prompted his co-accused policemen to chase the accused and sho[o]t him
when he resisted, after he fired at Mayor Cawaling.
4. The trial court gravely erred in not giving weight to accused-appellant policemen[s] testimonies which carry the presumption of
regularity.
5. The trial court gravely erred in not acquitting all the accused-appellants by applying the equipoise rule thereby resulting [i]n reasonable
doubts on the guilt.[25]
In their joint brief,[26] Appellants Tumbagahan and Cajilo cite these other errors:
1. The trial court gravely erred in relying on the theory of the prosecution that accused-appellants Ernesto Tumbagahan and Hilario Cajilo
were alleged co-conspirators in the killing of the victim, Ronie Ilisan.
2. The trial court gravely erred in not believing the defense that herein accused-appellants merely did a lawful duty when the shooting
incident happened which led to the death of Ronnie Ilisan.
3. The trial court gravely erred in not acquitting herein accused-appellants by applying the equipoise rule, thereby resulting in reasonable
doubt on their guilt.
4. Prescinding from the foregoing, herein accused-appellants do press and hold, that the lower court committed grave, serious
and reversible error in appreciating the qualifying circumstance of treachery (alevosia).
5. The lower court committed grave, serious and reversible error in convicting both accused-appellants of murder, instead merely of
homicide, defined and penalized under the Revised Penal Code.
6. The lower court committed grave, serious and reversible error in appreciating the qualifying circumstance of taking advantage of
superior strength.
7. The consummated crime being merely homicide, the mitigating circumstance of voluntary surrender should be considered to lower the
penalty of homicide.
8. The lower court committed error in not considering double jeopardy.
9. The lower court committed error in not dismissing the case for want of jurisdiction.[27]
Appellant Cawaling imputes these additional errors to the court a quo:
1. The trial court gravely erred in not acquitting herein accused-appellant, Ulysses M. Cawaling, considering that he had no part in the
killing and the prosecution failed to prove his guilt beyond reasonable doubt;
2. The trial court gravely erred in not finding the shooting incident a result of hot pursuit and shoot-out between the deceased Ronnie
Ilisan and the police officers in the performance of their duty and self-defense, and in sustaining the prosecutions conspiracy theory;
3. The trial court gravely erred in not acquitting Accused-Appellant Ulysses M. Cawaling considering that there was blatant absence of due
process in the proceedings tantamount to mistrial.[28]
This Courts Ruling
We affirm the conviction of the appellants. In so ruling, we will resolve the following issues: (1) jurisdiction of the trial court, (2)
double jeopardy, (3) credibility of prosecution witnesses and their testimonies, (4) self-defense, (5) performance of lawful duty, (6) alibi,
(7) conspiracy, (8) rule on equipoise, (9) qualifying circumstances, (10) damages and (11) attending circumstances as they affect the
penalty.
We shall address the first two issues as important preliminary questions and discuss the merits of the remaining ones, which we
have culled from the errors cited by the appellants in their aforementioned briefs.
First Issue:
Jurisdiction of the Trial Court
Appellants Tumbagahan and Cajilo argue that the trial court erred when it assumed jurisdiction over the criminal case. They insist
that the Sandiganbayan, not the regular courts, had jurisdiction to try and hear the case against the appellants, as they were public
officers at the time of the killing which was allegedly committed by reason of or in relation to their office.
We do not agree.
The jurisdiction of a court to try a criminal case is determined by the law in force at the time of the institution of the action. Once
the court acquires jurisdiction, it may not be ousted from the case by any subsequent events, such as a new legislation placing such
proceedings under the jurisdiction of another tribunal. The only recognized exceptions to the rule, which find no application in the case at
bar, arise when: (1) there is an express provision in the statute, or (2) the statute is clearly intended to apply to actions pending before its
enactment.[29]
The statutes pertinent to the issue are PD 1606, as amended;[30] and PD 1850, as amended by PD 1952 and BP 129.
Section 4 of PD 1606[31] reads:
Sec. 4. Jurisdiction. -- The Sandiganbayan shall exercise:
(a) Exclusive original jurisdiction in all cases involving:
xxxxxxxxx
(2) Other offenses or felonies committed by public officers and employees in relation to their office, including those employed in
government-owned or controlled corporations, whether simple or complexed with other crimes, where the penalty prescribed by law is
higher than prision correccional or imprisonment for six (6) years, or a fine of P6,000.00: PROVIDED, HOWEVER, that offenses or felonies
mentioned in this paragraph where the penalty prescribed by law does not exceed prision correccional or imprisonment for six (6) years
or a fine of P6,000.00 shall be tried by the proper Regional Trial Court, Metropolitan Trial Court, Municipal Trial Court and Municipal
Circuit Trial Court.
xxxxxxxxx
However, former President Ferdinand Marcos issued two presidential decrees placing the members of the Integrated National
Police under the jurisdiction of courts-martial. Section 1 of PD 1952,[32] amending Section 1 of PD 1850, reads:
SECTION 1. Court Martial Jurisdiction over Integrated National Police and Members of the Armed Forces. Any provision of law to the
contrary notwithstanding -- (a) uniformed members of the Integrated National Police who commit any crime or offense cognizable by the
civil courts shall henceforth be exclusively tried by courts-martial pursuant to and in accordance with Commonwealth Act No. 408, as
amended, otherwise known as the Articles of War; (b) all persons subjects to military law under Article 2 of the aforecited Articles of War
who commit any crime or offense shall be exclusively tried by courts-martial or their case disposed of under the said Articles of
War; Provided, that, in either of the aforementioned situations, the case shall be disposed of or tried by the proper civil or judicial
authorities when court-martial jurisdiction over the offense has prescribed under Article 38 of Commonwealth Act Numbered 408, as
amended, or court-martial jurisdiction over the person of the accused military or Integrated National Police personnel can no longer be
exercised by virtue of their separation from the active service without jurisdiction having duly attached beforehand unless otherwise
provided by law:
PROVIDED FURTHER, THAT THE PRESIDENT MAY, IN THE INTEREST OF JUSTICE, ORDER OR DIRECT, AT ANY TIME BEFORE ARRAIGNMENT,
THAT A PARTICULAR CASE BE TRIED BY THE APPROPRIATE CIVIL COURT.
As used herein, the term uniformed members of the Integrated National Police shall refer to police officers, policemen, firemen, and jail
guards.
On the other hand, the jurisdiction of regular courts over civil and criminal cases was laid down in BP 129, the relevant portion of
which is quoted hereunder:
Sec. 20. Jurisdiction in Criminal Cases. -- Trial Courts shall exercise exclusive original jurisdiction in all criminal cases not within the
exclusive jurisdiction of any court, tribunal or body, except those now falling under the exclusive and concurrent jurisdiction of the
Sandiganbayan which shall hereafter be exclusively taken cognizance of by the latter.[33]
In relation to the above, Section 4-a-2 of PD 1606, as amended by PD 1861, quoted earlier, lists two requisites that must concur
before the Sandiganbayan may exercise exclusive and original jurisdiction over a case: (a) the offense was committed by the accused
public officer in relation to his office; and (b) the penalty prescribed by law is higher than prision correccionalor imprisonment for six (6)
years, or higher than a fine of six thousand pesos (P6,000).[34] Sanchez vs. Demetriou[35] clarified that murder or homicide may be
committed both by public officers and by private citizens, and that public office is not a constitutive element of said crime, viz.:
The relation between the crime and the office contemplated by the Constitution is, in our opinion, direct and not accidental. To fall into
the intent of the Constitution, the relation has to be such that, in the legal sense, the offense cannot exist without the office. In other
words, the office must be a constituent element of the crime as defined in the statute, such as, for instance, the crimes defined and
punished in Chapter Two to Six, Title Seven, of the Revised Penal Code.
Public office is not the essence of murder. The taking of human life is either murder or homicide whether done by a private citizen or
public servant, and the penalty is the same except when the perpetrator, being a public functionary, took advantage of his office, as
alleged in this case, in which event the penalty is increased.
But the use or abuse of office does not adhere to the crime as an element; and even as an aggravating circumstance, its materiality arises, A. No, sir.
not from the allegations but on the proof, not from the fact that the criminals are public officials but from the manner of the commission Q. Why?
of the crime. A. Luz Venus told us not to go out when [I] stood up to go home.
Furthermore, the Information filed against the appellants contains no allegation that appellants were public officers who Q. Do you know why you were advise[d] not to go out?
committed the crime in relation to their office. The charge was for murder, a felony punishable under Article 248 of the Revised Penal A. Yes, sir.
Code. As clarified in Aguinaldo, et al. vs. Domagas, et al.,[36] [I]n the absence of such essential allegation, and since the present case does Q. Why?
not involve charges of violation of R.A. No. 3019 (the Anti-Graft etc. Act), the Sandiganbayan does not have jurisdiction over the present A. Because we were being watched by Mayor Cawaling, Andres Fontamillas, Hilario Cajilo and Alex Bat[ui]gas.
case. (Bartolome vs. People, 142 SCRA 459 [1986] Even before considering the penalty prescribed by law for the offense charged, it is thus xxxxxxxxx
essential to determine whether that offense was committed or alleged to have been committed by the public officers and employees in Q. When you were informed by Luz Venus that you should not go out because Mayor Cawaling and the persons you mentioned were
relation to their offices. outside watching for you, what did you do?
Jurisdiction is determined by the allegations in the complaint or information. [37] In the absence of any allegation that the offense A. We did not go out.
was committed in relation to the office of appellants or was necessarily connected with the discharge of their functions, the regional trial Q. Since you remained inside, what did you do?
court, not the Sandiganbayan, has jurisdiction to hear and decide the case.[38] A. I also viewed thru the window.
Second Issue: Q. Did you see them?
Double Jeopardy A. Yes, sir.
In seeking their acquittal, Appellants Tumbagahan and Cajilo also invoke their right against double jeopardy. They argue that the Q. How far were they from the restaurant?
first jeopardy attached when a criminal case for murder was filed before the Judge Advocate Generals Office (JAGO), which was allegedly A. About three meters.
dismissed after several hearings had been conducted.[39] We are not persuaded. Q. What were they doing outside the restaurant?
There is double jeopardy when the following requisites are present: (1) a first jeopardy has attached prior to the second; (2) the A. They were also viewing us.
first jeopardy has been validly terminated; and, (3) a second jeopardy is for the same offense as that in the first. And the first jeopardy Q. For how long did they remain there viewing you?
attaches only (a) after a valid indictment; (b) before a competent court; (c) after arraignment; (d) when a valid plea has been entered; and A. Just a short time.
(e) when the accused was acquitted or convicted, or the case was dismissed or otherwise terminated without his express consent.[40] Q. And later on, do you know where did they go? [sic]
For a better appreciation of appellants argument, we must consider PD 39[41] and its implementing rules,[42] which prescribe the A. No, sir. I went out from the restaurant and when I went out, I did not see them anymore.
procedure before a military commission. A summary preliminary investigation shall be conducted before trial for the purpose of Q. Before you went out of the restaurant, what did you do?
determining whether there is prima facie evidence to pursue trial before a military commission. The investigation report shall contain a A. Diosdado Venus accompanied us.
summary of the evidence, the acts constituting the offense or offenses committed, and the findings and recommendations of the Q. Why did you ask Diosdado Venus to accompany you?
investigating officer. Thereafter, the report shall be forwarded to the judge advocate general, who shall determine for either the defense A. Yes, sir. Because we were aware that we were being watched from outside so we asked to be accompanied by Diosdado Venus.
secretary or for the AFP chief of staff whether the case shall be referred for trial to a military commission. [43] Where a prima facie case is Q. From the restaurant accompanied by Diosdado Venus, what did you do?
found against the accused, formal charges shall be signed by a commissioned officer designated by the judge advocate general.[44] The A. Towards home.
accused shall then be arraigned, during which the charge and specification shall be read and the accused shall enter his plea.[45] After Q. Were you able to reach home?
hearings, a record of the trial shall be forwarded to the AFP chief of staff for proper action.[46] A. No, sir.
In the present case, the appellants have presented no sufficient and conclusive evidence to show that they were charged, arraigned Q. Why, what happened on the way?
and acquitted in a military commission, or that the case was dismissed therein without their consent. The defense merely offered as A. Diosdado Venus ran going back because we were lighted by a flashlight.
evidence certain disposition forms[47] and a letter,[48] dated March 8, 1983, recommending that the case against Appellants Tumbagahan, Q. How many flashlight[s] were trimed [sic] to you?
Cajilo and De los Santos be dropped and considered closed.[49] No charge sheet and record of arraignment and trial were presented to A. Six.
establish the first jeopardy. Q. Did you come to know who trimed [sic] the flashlight towards you?
As pointed out by the solicitor general, appellants were never arraigned, they never pleaded before the Judge Advocate Generals A. Yes, sir.
Office, there was no trial, and no judgment on the merits had been rendered.[50] Q. Who were they?
Third Issue: A. Mayor Cawaling, Andres Fontamillas, Hilario Cajilo, Ernesto Tumbagahan, Ricardo delos Santos and Alex Batuigas.
Credibility of Witnesses Q. How were you able to recognize them when that was night time?
As a general rule, the factual findings of trial courts deserve respect and are not disturbed on appeal, unless some facts or A. Because the flashlight[s] were bright.
circumstances of weight and substance have been overlooked, misapprehended or misinterpreted, and would otherwise materially affect Q. When Diosdado Venus ran back to his restaurant, what did your brother Ronie Elisan and you do?
the disposition of the case.[51] This rule, however, does not apply when the judge who penned the decision was not the same one who had A. We also ran towards home.
heard the prosecution witnesses testify,[52] as in the present case. Nonetheless, we have carefully perused and considered the voluminous Q. To whose house?
records of this case, and we find no reason to alter the findings of the court a quo in regard to the credibility of the prosecution witnesses A. That of my older sister Imelda [E]lisan.
and their testimonies. Q. Were you able to reach that house?
Vicente Ilisan, the victims brother, narrated before the trial court the circumstances relevant to the crime: A. No, sir.
Q. In the evening of December 4, 1982, at about 8:00 or 8:30, where were you? Q. Why, what happened when you ran away?
A. I was inside the restaurant of Andres Fontamillas. A. Andres Fontamillas and Hilario Cajilo were blocking us on the gate of the fence of my sisters house.
xxxxxxxxx Q. Since your way was blocked, where did Ronie Elisan go?
Q. What were you doing there? A. We ran towards the ricefield.
A. I was drinking tuba. Q. When you ran, what did Mayor Cawaling do?
Q. When you were about to finish drinking tuba, what did you do? A. They were chasing us.
A. I stood up preparing to go home. Q. What about Alex Batuigas, what did he do?
Q. Were you able to leave that restaurant actually? A. He also followed helping chasing us. [sic]
 Q. What about the four policemen, what did they do?
A. The same. They were also chasing us.
Q. About how far is that restaurant [from] the spot where you were first lighted by the flashlight of the accused?
A. About one hundred meters.
Q. Now, according to you, you ran towards the ricefield, what happened while you were running towards the ricefield?
A. I saw my brother fell [sic] down.
Q. Fell down where?
A. On the ricefield.
Q. What about you, where were you when your brother fell down in the ricefield?
A. I ran towards the bushes.
Q. What did you do upon reaching the bushes?
A. I la[y] on the ground with my belly touch[ing] on the ground behind the coconut tree.
Q. When your brother according to you had fallen on the ricefield, what did he do thereafter?
A. He rose up, [raised] his hands and surrender[ed] to them.
Q In rising, what was his position?
A. He was rising like this. (Witness demonstrating by kneeling [and] raising his two hands).
Q. While Ronie Elisan was kneeling and raising both of his hands, what happened?
A. Mayor Cawaling approached him together with the four policemen and his brother-in-law and they shot him.
Q. Do you know what weapon[s] were used in shooting your brother?
A. Yes, sir.
Q. What weapon were used?
A. The weapon of Mayor Cawaling is .45 caliber and that of Andres Fontamillas and Hilario Cajilo were both armalite and that of
Ernesto Tumbagahan, Alex Batuigas and Ricardo delos Santos were .38 caliber.
Q. How were you able to identify their weapons?
A. Because the flashlight[s] were bright.
Q. Now, what happened to your brother when he was fired upon by the accused in this case?
A. He fell down.
Q. And how far is that spot where your elder brother had fallen down to the spot where Diosdado Venus left you when he returned to
the restaurant?
A. To my estimate it is about 300 meters.
Q. After your brother had fallen down, what did the accused do?
A. Mayor Cawaling said, []you left him, he is already dead.[]
Q. Where did they go?
A. They went towards the house of Mayor Cawaling.[53]
Imelda Tumbagahan was at home feeding her child when she heard her brother Ronie shouting for help. After getting a flashlight
and looking through the window of her house, she saw Cawaling and Alex Batuigas chasing Ronie who was running towards her
house. Tumbagahan and De los Santos prevented Ronie from entering the fence of her house, as a result of which, her brother ran
towards a rice field nearby. There, on bended knees and with hands raised, Ronie was shot by Cawaling and his men.[54]
Nelson Ilisan also heard his younger brother Ronie shouting for help while being chased by the group of Cawaling. As Cajilo and
Fontamillas blocked Ronie from entering the gate of Imeldas house, the victim ran towards a rice field. Nelson stopped Cawaling and
asked, Nong, basi guinalagas ninyo ang acon hali? (Nong, why do you chase my brother?) But the mayor merely continued chasing
Ronie. Thereafter, Nelson saw his brother, on his knees with both hands raised, shot by appellants.[55]
The three aforementioned witnesses narrated in detail the assault against their brother Ronie and positively identified the
appellants as the perpetrators. The trial court cannot be faulted for relying on their testimonies and accepting them as true,[56] especially
when the defense failed, to prove any ill motive on their part.[57] In addition, family members who have witnessed the killing of their loved
one usually strive to remember the faces of the assailants.[58] Thus, the relationship per se of witnesses with the victim does not
necessarily mean that the former are biased. On the contrary, it is precisely such relationship that would impel them to seek justice and
put the real culprit behind bars, rather than impute the offense to the innocent.[59]
Appellant Cawaling submits that the prosecution witnesses tampered with the evidence by cleaning the cadaver before an autopsy
could be done. Such irregular washing of the cadaver by a close relative of the deceased, who is educated and who presumably knew
perfectly well the need to preserve it in its original state for the medico-legal examination[,] is highly suspicious. It points to the fact that
the relatives of the deceased wanted to hide, or erase something that would bolster and assist the defense (that is, state of drunkenness,
powder burns or lack thereof, indicating the firing of a weapon or the proximity of the weapon used on the deceased, etc.).[60]
Such contention is unavailing. First, Bebelinia Sacapao merely cleaned the cadaver and made no further
examination. Second, appellants had an opportunity to have the body examined again to determine or prove important matters, such as
whether Ronie was drunk, if he fired a gun, how many and what caliber of guns were used in shooting him; they did not, however, avail
themselves of this opportunity. As public officers, appellants knew that it was within their power to request or secure from the court, or
any other competent authority, an order for another autopsy[61] or any such evidence as may affirm their innocence. Third, their
conviction lies in the strong and convincing testimonial evidence of the prosecution, not in the corroborative testimony of Bebelinia
Sacapao.
Relying on the testimonies of Luz Venus and Gil Palacio, Appellant Cawaling also pointed out that [t]he power of observation of
alleged eyewitness Vicente was severely affected by his intoxication. It may be inferred that an intoxicated persons sense[s] of sight and
hearing and of touch are less acute than those of a sober person and that his observation are inexact as to what actually occurred.[62]
This argument is not persuasive. The evidence presented fails to show that Vicente was so intoxicated that night as to affect his
powers of observation and retrospection. Defense Witness Palacio merely saw the witness drinking tuba on the night of the
killing.[63] Meanwhile the whole testimony of Luz on the matter mainly reveals that Ronie was the person she was referring to as drunk, as
shown by this portion:[64]
Q When Ronie and Vicente both surnamed Ilisan entered the C & J-4 kitchenette what if any did you observe?
A I saw them so dr[u]nk (Nakita ko sila lasing na lasing).
Q Who was lasing na lasing or so dr[u]nk?
A Ronie Ilisan sir.
Granting that Vicente was drunk, the conviction of the appellants is still inevitable in view of the positive declarations of Witnesses
Nelson and Imelda, who unequivocally identified appellants as perpetrators of the senseless killing of their brother Ronie.
Appellant Cawaling also questions the trial courts reliance on the testimonies of Dr. Blandino Flores, [65] Nelson
Ilisan and Prosecutor Pedro Victoriano, Jr.,[67] for failure of the prosecution to offer them as evidence. In People vs. Java,[68] this Court
[66]
ruled that the testimony of a witness, although not formally offered in evidence, may still be admitted by the courts, if the other party
does not object to its presentation. The Court explained: Section 36 of [Rule 132] requires that an objection in the course of the oral
examination of a witness should be made as soon as the grounds therefor shall become reasonably apparent. Since no objection to the
admissibility of evidence was made in the court below, an objection raised for the first time on appeal will not be considered. In the
present case, a cursory reading of the stenographic notes reveals that the counsel for the appellants did not raise any objection when said
witnesses testified on the matters now being impugned. Moreover, they repeatedly cross-examined the witnesses, which shows that they
had waived their objections to the said testimonies of such witnesses.
Lastly, Appellant Mayor Cawaling questions the motive of Prosecutor Pedro Victoriano Jr. This contention is likewise bereft of
merit. Unlike judges who are mandated to display cold neutrality in hearing cases,[69] prosecutors are not required to divest themselves of
their personal convictions and refrain from exhibiting partiality. In this case, there is reasonable ground for Prosecutor Victoriano to
believe that an offense has been committed and that the accused was probably guilty thereof.[70] Under the circumstance, it is his sworn
duty to see that justice is served.[71] Thus, [h]e may prosecute with earnestness and vigor - - indeed, he should do so. But, while he may
strike hard blows, he is not at liberty to strike foul ones. It is as much his duty to refrain from improper methods calculated to produce a
wrongful conviction as it is to use every legitimate means to bring about a just one.[72] Further,
Under the prevailing criminal procedure, the fiscals sphere of action is quite extensive, for he has very direct and active intervention in the
trial, assuming as the Governments representative the defense of society, which has been disturbed by the crime, and taking public action
as though he were the injured party, for the purpose of securing the offenders punishment, whenever the crime has been proved and the
guilt of the accused as the undoubted perpetrator thereof established.[73]
Fourth Issue:
Self-Defense
To escape criminal liability, the appellants also invoke the justifying circumstances of self-defense and lawful performance of
duty.[74] Allegedly, Ronie was firing his gun and shouting Guwa ang maisog! (Come out who is brave!). Then the mayor and the policemen
arrived at the scene to pacify him. Ronie fired at them, which forced them to chase him and return fire.
We find this scenario bereft of plausibility.
Unlawful aggression on the part of the victim is a condition sine qua non for the successful invocation of self-defense.[75] As factually
found by the trial court, unlawful aggression did not start with the victim, but rather with the appellants. Cawaling and his men proceeded
to the C & J-4 Kitchenette and waited for Ronie to come out. When the victim did, they chased and shot him without giving him any
opportunity to defend himself.
Granting arguendo the veracity of the defenses factual version, it is important to note that appellants admitted that Ronie was
running away from them when they chased and shot him.Thus, unlawful aggression -- assuming it was initially present had ceased, and
the appellants no longer had any right to pursue the offender. Basic is the rule that when unlawful aggression ceases, the defender no
longer has the right to kill or even wound the former aggressor. Upon the cessation of the unlawful aggression and the danger or risk to
life and limb, there should be a corresponding cessation of hostilities on the part of the person defending himself.[76]
 Furthermore, the means employed to ward off the attack was unreasonably excessive. Being armed, the appellants could have
easily ordered the victim to surrender. Even the first shot at his shoulder would have been sufficient to immobilize him, yet they fired a
succession of shots at him while he was in no position to put up a defense.
Jurisprudence teaches that when an accused admits having committed the crime but invokes self-defense to escape criminal
liability, the burden of proof is reversed and shifted to him.He must then prove the elements of self-defense.[77] It necessarily follows that
he must now rely on the strength of his own evidence and not on the weakness of that of the prosecution; for even if the latter evidence
were weak, it could not be disbelieved after the accused has admitted the killing. [78] Thus, appellants must establish with clear and
convincing evidence that the killing was justified, and that they incurred no criminal liability therefor.[79] They failed to do so, and their
conviction thus becomes inevitable.[80]
Fifth Issue:
Lawful Performance of Duties
Appellants contend that the killing of Ronie resulted from the lawful performance of their duties as police officers. However, such
justifying circumstance may be invoked only after the defense successfully proves that (1) the accused acted in the performance of a duty,
and (2) the injury or offense committed is the necessary consequence of the due performance or lawful exercise of such duty.[81] These
two requisites are wanting in this case.
The appellants, except Mayor Cawaling, were men in uniform who happened to be on duty when they killed Ronie. The victim was
not committing any offense at the time. Killing the victim under the circumstances of this case cannot in any wise be considered a valid
performance of a lawful duty by men who had sworn to maintain peace and order and to protect the lives of the people. As aptly held
in People vs. De la Cruz,[82] Performance of duties does not include murder. That Ronie was a troublemaker in their town is not an excuse;
as the Court declared in the same case of People vs. De la Cruz, Murder is never justified, regardless of the victim.
Sixth Issue:
Alibi
We likewise brush aside the defenses of alibi and denial raised by Appellant De los Santos. Prosecution witnesses positively
identified him and Fontamillas as part of the group which chased and shot Ronie Ilisan. It is elementary that alibi and denial are
outweighed by positive identification that is categorical, consistent and untainted by any ill motive on the part of the eyewitness testifying
on the matter. Alibi and denial, if not substantiated by clear and convincing evidence, are negative and self-serving evidence undeserving
of weight in law.[83]
In fact, De los Santos failed to establish with clear and convincing evidence that it was physically impossible for him to have been at
the scene of the crime during its commission.[84] The evidence he had presented demonstrated only that, at the time, he was sleeping in
his house, which was near the locus criminis.
Alibi is always considered with suspicion and received with caution, not only because it is inherently weak and unreliable, but also
because it is easily fabricated and concocted.[85] It is therefore incumbent upon the appellant to prove that he was at another place when
the felony was committed, and that it was physically impossible for him to have been at the scene of the crime at the time it was
committed.[86] This he failed to prove.
Seventh Issue:
Conspiracy
The trial court correctly appreciated the presence of conspiracy. Conspiracy exists when two or more persons come to an
agreement concerning the commission of a felony and decide to commit it. Direct proof of conspiracy is rarely found, for criminals do not
write down their lawless plans and plots. The agreement to commit a crime, however, may be deduced from the mode and manner of the
commission of the offense or inferred from acts that point to a joint purpose and design, concerted action, and community of intent.[87] It
does not matter who inflicted the mortal wound, as the act of one is the act of all, and each incurs the same criminal liability.[88] We
concur with the trial courts elucidation:
All of the accused chased the victim and his brother; four (4) of whom blocked their ways, first, to their elder brother Nelson Elisans house
and, second, to their elder sister Imelda Elisan Tumbagahons house. Having changed course by proceeding to the ricefield in their
desperate attempt to evade the accused, all the six (6) armed accused continued their pursuit. Their victim, having fallen on the rice
paddy, and rising and kneeling on it with raised hands, all the said accused with their flashlights beamed on their victim, in a united and
concerted manner, shot him. After Ronie Elisan had fallen down, co-accused Mayor Cawaling was even heard as saying (Y)ou left [sic] him,
he is already dead. x x x.[89]
Eighth Issue:
Equipoise Rule
We reject appellants position that the equipoise rule should apply to this case. [90] In People vs. Lagnas,[91] the Court through Mr.
Justice Florenz D. Regalado described this rule, as follows:
Once again, albeit in effect a supportive and cumulative consideration in view of the preceding disquisition, the equipoise rule finds
application in this case, that is, if the inculpatory facts and circumstances are capable of two or more explanations, one of which is
consistent with the innocence of the accused and the other consistent with his guilt, then the evidence does not fulfill the test of moral
certainty, and is not sufficient to support a conviction.
In this case, the inculpatory facts point to only one conclusion: appellants are guilty. As amplified in the discussion above, the Court
agrees with the trial court that the guilt of the appellants was proven beyond reasonable doubt.
Ninth Issue:
Murder or Homicide?
The Information alleges three qualifying circumstances: treachery, evident premeditation and taking advantage of superior
strength. If appreciated, any one of these will qualify the killing to murder. However, Appellants Tumbagahan and Cajilo posit that there
was no treachery, reasoning that Ronie was not an unsuspecting victim, as he had been forewarned by Diosdado Venus of the presence of
the appellants inside the restaurant and there had been a chase prior to the killing. Further, they contend that abuse of superior strength
is deemed absorbed in treachery, and that the addition of abuse of superior strength to qualify the case to murder is nothing more than
mere repetition - a legal chicanery, so to say. Similarly, where treachery is not proved, there can be no abuse of superior strength, vice-
versa.[92]
We partly agree.
Treachery exists when the malefactors employ means and methods that tend directly and especially to insure their execution
without risk to themselves arising from the defense which the victims might make. The essence of treachery is the sudden and
unexpected attack without the slightest provocation on the part of the person attacked.[93] While we do not disregard the fact that the
victim, together with his brother Vicente, was able to run towards a rice field, we still believe that treachery attended the killing.
In People vs. Landicho,[94] we ruled that treachery might still be appreciated even when the victim was warned of danger to his
person, for what is decisive is that the execution of the attack made it impossible for the victim to defend himself or to retaliate.
The appellants waited for Ronie to come out of the restaurant. All of them chased the victim and prevented him from seeking
refuge either in the house of his sister Imelda or that of his brother Nelson. All of them carried firearms and flashlights. They fired their
guns at the victim while he was on his knees with arms raised, manifesting his intention not to fight back.
We cannot appreciate the aggravating circumstance of abuse of superior strength, however, as we have consistently ruled that it is
deemed absorbed in treachery.[95]
We also affirm the finding of the trial court that the prosecution failed to prove the attending circumstance of evident
premeditation. To prove this aggravating circumstance, the prosecution must show the following: (1) the time when the offender
determined to commit the crime; (2) an act manifestly indicating that the offender clung to his determination; and (3) a lapse of time,
between the determination to commit the crime and the execution thereof, sufficient to allow the offender to reflect upon the
consequences of his act.[96] Nothing in the records shows how and when the plan to kill was hatched, or how much time had elapsed
before it was carried out.
Tenth Issue:
Damages
The trial court awarded the following: (a) P50,000.00, as civil indemnity; (b) P6,000.00, as actual damages; and (c) P116,666.66, for
lost earnings. In computing the latter, the trial court used the following formula:
Total annual net income = 10% x total annual gross income
= .10 x P25,000.00
= P2,500.00
xxx xxx xxx
Loss of earning capacity of Ronie Elisan = 2/3 (90-20) x P2,500.00 = P116,666.66.[97]
Consistent with jurisprudence, we affirm the ruling of the trial court awarding the amount of P50,000 as civil indemnity to the heirs
of the victim.[98]
We cannot do the same to the award of actual damages and lost earnings, however. The award of actual damages has no basis, as
no receipts were presented to substantiate the expenses allegedly incurred. An alleged pecuniary loss must be established by credible
evidence before actual damages may be awarded.[99] Similarly erroneous is the award for loss of earning capacity, which should be
computed as follows:[100]
2/3 x [80 - age of victim at the time of death] x [reasonable portion of the annual net income which would have been received as
support by heirs]
As testified to by Nelson Ilisan, the deceased had been earning an average of P100 daily or P3,000 monthly.[101] From this monthly
income must be deducted the reasonable amount of P1,000 representing the living and other necessary expenses of the deceased. Hence,
the lost earnings of the deceased should be computed as follows:
= 2/3 x [80 - 22] x [P24,000]
= 2/3 x [58] x [P24,000]
= 2[P 1,392,000]
3
 = P2,784,000
3 Certification to File Action dated September 14, 1997.5
= P928,000.
Eleventh Issue:
Aggravating and Mitigating Circumstances
Prior to the amendment of Section 248 of the Revised Penal Code,[102] the imposable penalty for murder was reclusion temporal in
its maximum period to death. In their Brief, Appellants Cajilo and Tumbagahan argue for the imposition of the lower penalty of reclusion
temporal, contending that their filing of bail bonds/property bonds, before the order for their arrest was issued, should be treated as
voluntary surrender.[103]
We cannot accept this contention. In the first place, it has no factual basis. The warrant for the arrest of herein appellants was
issued on August 18, 1987,[104] but appellants counsel filed the Urgent Motion for Bail only thereafter, on September 2, 1987.[105] In the
second place, appellants failed to prove the requisites for voluntary surrender, which are: (1) the offender has not been actually arrested;
(2) the offender surrenders himself to a person in authority or to the latters agent; and (3) the surrender is voluntary. [106] The records
reveal that a warrant of arrest was actually served on Tumbagahan and Cajilo[107] on September 2, 1987 and that they were in fact
detained.[108]
In view of the absence of any other aggravating or mitigating circumstance, the trial court correctly imposed reclusion perpetua.
WHEREFORE, the appeal is hereby DENIED and the assailed Decision is AFFIRMED with the following MODIFICATIONS: (1) the
award of P6,000 as actual damages is DELETED,and (2) the award for loss of earning capacity is INCREASED to P928,000. Costs against
appellant.
SO ORDERED.
Davide, Jr., (Chairman), Bellosillo, Vitug, and Quisumbing, JJ., concur.
G.R. No. 146195 November 18, 2004
AVELINA ZAMORA, EMERITA ZAMORA-NICOL, SONNY NICOL, TERESA ZAMORA-UMALI, CLARENCE UMALI, ROBERTO ZAMORA,
ROLANDO ZAMORA, MARY ANN ZAMORA, MICHELLE ZAMORA and RODRIGO ZAMORA, petitioners,
vs.
HEIRS of CARMEN IZQUIERDO, represented by their attorney-in-fact, ANITA F. PUNZALAN, respondents.
DECISION
SANDOVAL-GUTIERREZ, J.:
Before us is a petition for review on certiorari1 assailing the Decision2 of the Court of Appeals dated September 12, 2000 and its Resolution
dated December 1, 2000 in CA-G.R. SP No. 54541, entitled "Avelina Zamora, et al., petitioners, versus Heirs of Carmen Izquierdo,
represented by the executrix, Anita F. Punzalan, respondents."
The records show that sometime in 1973, Carmen Izquierdo and Pablo Zamora entered into a verbal stipulation whereby the former
leased to the latter one of her apartment units located at 117-B General Luna Street, Caloocan City. They agreed on the following: the
rental is P3,000.00 per month; the leased premises is only for residence; and only a single family is allowed to occupy it.
After the death of Carmen (lessor) in 1996 her attorney-in-fact, Anita Punzalan, representing the heirs, herein respondents, prepared a
new contract of lease wherein the rental was increased from P3,000.00 to P3,600.00 per month.3 However, petitioners refused to sign it.
In January 1997, Pablo (lessee) died. His wife, Avelina Zamora, and their children (two of whom have their own families), herein
petitioners, continued to reside in the apartment unit. However, they refused to pay the increased rental and persisted in operating a
photocopying business in the same apartment.
Meanwhile, petitioner Avelina Zamora applied with the Metropolitan Waterworks & Sewerage System (MWSS) for a water line installation
in the premises. Since a written consent from the owner is required for such installation, she requested respondents' attorney-in-fact to
issue it. However, the latter declined because petitioners refused to pay the new rental rate and violated the restrictions on the use of the
premises by using a portion thereof for photocopying business and allowing three families to reside therein.
This prompted petitioner Avelina Zamora to file with the Office of the Punong Barangay of Barangay 16, Sona 2, District I, Lungsod ng
Caloocan, a complaint against Anita Punzalan (respondents' attorney-in-fact), docketed as "Usaping Bgy. Blg. 1-27-97, Ukol sa: Hindi
Pagbibigay ng Pahintulot sa Pagpapakabit ng Tubig."
On August 24, 1997, during the barangay conciliation proceedings, petitioner Avelina Zamora declared that she refused to sign the new
lease contract because she is not agreeable with the conditions specified therein.
The following day, Anita Punzalan sent Avelina a letter4 informing her that the lease is being terminated and demanding that petitioners
vacate the premises within 30 days from notice.
Despite several barangay conciliation sessions, the parties failed to settle their dispute amicably. Hence, the Barangay Chairman issued a
Consequently, on October 2, 1997, respondents, represented by Anita Punzalan, filed with the Metropolitan Trial Court (MTC), Branch 49,
Caloocan City, a complaint for unlawful detainer and damages against petitioners, docketed as Civil Case No. 23702. 6 Forthwith,
petitioners filed a motion to dismiss7 the complaint on the ground that the controversy was not referred to the barangay for conciliation.
First, they alleged that the barangay Certification to File Action "is fatally defective" because it pertains to another dispute, i.e., the refusal
by respondents' attorney-in-fact to give her written consent to petitioners' request for installation of water facilities in the premises. And,
second, when the parties failed to reach an amicable settlement before the Lupong Tagapamayapa, the Punong Barangay (as Lupon
Chairman), did not constitute the Pangkat ng Tagapagkasundo before whom mediation or arbitration proceedings should have been
conducted, in violation of Section 410(b), Chapter 7 (Katarungang Pambarangay), Title One, Book III of Republic Act No. 71608 (otherwise
known as the Local Government Code of 1991), which reads:
"SECTION 410. Procedure for Amicable Settlement.–
(a) x x x
(b) Mediation by lupon chairman – Upon receipt of the complaint, the lupon chairman9 shall, within the next working day,
summon the respondent(s), with notice to the complainant(s) for them and their witnesses to appear before him for a
mediation of their conflicting interests. If he fails in his mediation effort within fifteen (15) days from the first meeting of the
parties before him, he shall forthwith set a date for the constitution of the pangkat in accordance with the provisions of this
Chapter." (Underscoring supplied)
Respondents opposed the motion to dismiss,10 the same being prohibited under Section 19 of the 1991 Revised Rule on Summary
Procedure. They prayed that judgment be rendered as may be warranted by the facts alleged in the complaint, pursuant to Section 611 of
the same Rule.
On July 9, 1998, the MTC issued an Order12 denying petitioners' motion to dismiss and considering the case submitted for decision in view
of their failure to file their answer to the complaint.
Petitioners filed a motion for reconsideration,13 contending that a motion to dismiss the complaint on the ground of failure to refer the
complaint to the Lupon for conciliation is allowed under Section 19 of the 1991 Revised Rule on Summary Procedure, which partly
provides:
"SEC. 19. Prohibited pleadings and motions. – The following pleadings, motions, or petitions shall not be allowed in the cases
covered by this Rule:
(a) Motion to dismiss the complaint or to quash the complaint or information except on the ground of lack of jurisdiction over
the subject matter, or failure to comply with the preceding section [referring to Section 18 on referral of the complaint to the
Lupon for conciliation];
x x x."
On August 26, 1998, the MTC rendered a Judgment14 in favor of respondents and against petitioners, the dispositive portion of which
reads:
"WHEREFORE, Judgment is hereby rendered in favor of the plaintiff and against the defendants, ordering defendants and all
persons claiming right under them:
1) To vacate the leased premises located at No. 117-B General Luna Street, Caloocan City and to surrender
possession thereof to the plaintiff;
2) To pay the amount of three thousand six hundred (P3,600.00) pesos per month starting January, 1997 until the
premises being occupied by them is finally vacated and possession thereof is restored to the plaintiff;
3) To pay plaintiff the sum of five thousand (P5,000.00) pesos as and for attorney's fees; and
4) To pay the costs of this suit.
SO ORDERED."
On appeal, the Regional Trial Court (RTC), Branch 125, Caloocan City, rendered its Decision15 dated February 15, 1999 affirming the MTC
Judgment. Subsequently, it denied petitioners' motion for reconsideration.16
Petitioners then filed with the Court of Appeals a petition for review, docketed as CA-G.R. SP No. 54541. On September 12, 2000, it
rendered a Decision17 affirming the RTC Decision.
Thereafter, petitioners filed a motion for reconsideration but was denied by the Appellate Court in its Resolution dated December 1,
2000.18
Hence, the instant petition.
I
The primordial objective of Presidential Decree No. 1508 (the Katarungang Pambarangay Law), now included under R.A. No. 7160 (the
Local Government Code of 1991), is to reduce the number of court litigations and prevent the deterioration of the quality of justice which
has been brought about by the indiscriminate filing of cases in the courts.19 To attain this objective, Section 412(a) of R.A. No. 7160
requires the parties to undergo a conciliation process before the Lupon Chairman or the Pangkat as a precondition to filing a complaint in
court, thus:
"SECTION 412. Conciliation. – (a) Pre-condition to Filing of Complaint in Court.– No complaint, petition, action, or proceeding
involving any matter within the authority of the lupon shall be filed or instituted directly in court or any other government
office for adjudication, unless there has been a confrontation between the parties before the lupon chairman or the pangkat,
and that no conciliation or settlement has been reached as certified by the lupon or pangkat secretary and attested to by the
lupon or pangkat chairman x x x." (Underscoring supplied)
In the case at bar, the Punong Barangay, as Chairman of the Lupong Tagapamayapa, conducted conciliation proceedings to resolve the
dispute between the parties herein. Contrary to petitioners' contention, the complaint does not only allege, as a cause of action, the
refusal of respondents' attorney-in-fact to give her consent to the installation of water facilities in the premises, but also petitioners'
violation of the terms of the lease, specifically their use of a portion therein for their photocopying business and their failure to pay the
increased rental. As correctly found by the RTC:
"The records show that confrontations before the barangay chairman were held on January 26, 1997, February 9, 1997,
February 23, 1997, February 28, 1997, July 27, 1997, August 3, 1997, August 10, 1997, August 17, 1997 and August 24, 1997
wherein not only the issue of water installation was discussed but also the terms of the lease and the proposed execution of a
written contract relative thereto. It appears, however, that no settlement was reached despite a total of nine meetings at the
barangay level.
It is of no moment that the complaint was initially made by defendant-appellant Avelina Zamora because herein plaintiff-
appellee was given by the Sangguniang Barangay the authority to bring her grievance to the Court for resolution. While it is
true that the Sertifikasyon dated September 14, 1997 is entitled 'Ukol Sa Hindi Pagbibigay Ng Pahintulot Sa Pagpapakabit Ng
Tubig', this title must not prevail over the actual issues discussed in the proceedings.
Hence, to require another confrontation at the barangay level as a sine qua non for the filing of the instant case would not
serve any useful purpose anymore since no new issues would be raised therein and the parties have proven so many times in
the past that they cannot get to settle their differences amicably."20
We cannot sustain petitioners' contention that the Lupon conciliation alone, without the proceeding before the Pangkat ng
Tagapagkasundo, contravenes the law on Katarungang Pambarangay. Section 412(a) of R.A. No. 7160, quoted earlier, clearly provides
that, as a precondition to filing a complaint in court, the parties shall go through the conciliation process either before the Lupon
Chairman (as what happened in the present case), or the Pangkat.
Moreover, in Diu vs. Court of Appeals,21 we held that "notwithstanding the mandate in Section 410(b) of R.A. No. 7160 that the Barangay
Chairman shall constitute a Pangkat if he fails in his mediation efforts," the same "Section 410(b) should be construed together with
Section 412(a) of the same law (quoted earlier), as well as the circumstances obtaining in and peculiar to the case." Here, while the
Pangkat was not constituted, however, the parties met nine (9) times at the Office of the Barangay Chairman for conciliation wherein not
only the issue of water installation was discussed but also petitioners' violation of the lease contract. It is thus manifest that there was
substantial compliance with the law which does not require strict adherence thereto.22
II
We hold that petitioners' motion to dismiss the complaint for unlawful detainer is proscribed by Section 19(a) of the 1991 Revised Rule on
Summary Procedure, quoted earlier. Section 19(a) permits the filing of such pleading only when the ground for dismissal of the complaint
is anchored on lack of jurisdiction over the subject matter, or failure by the complainant to refer the subject matter of his/her complaint
"to the Lupon for conciliation" prior to its filing with the court. This is clear from the provisions of Section 18 of the same Rule, which
reads:
"SEC. 18. Referral to Lupon. – Cases requiring referral to the Lupon for conciliation under the provisions of Presidential Decree
No. 1508 where there is no showing of compliance with such requirement, shall be dismissed without prejudice, and may be
revived only after such requirement shall have been complied with. This provision shall not apply to criminal cases where the
accused was arrested without a warrant." (Underscoring supplied)
As discussed earlier, the case was referred to the Lupon Chairman for conciliation. Obviously, petitioners' motion to dismiss, even if
allowed, is bereft of merit.
WHEREFORE, the petition is DENIED. The assailed Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 54541 sustaining the
Decision of the RTC which upheld the MTC Judgment is AFFIRMED.
Costs against petitioners.
SO ORDERED.
Panganiban, (Chairman), Carpio-Morales, and Garcia, JJ., concur.
Corona, J., on leave.
GENERAL PROVISION RULE 1 (SEC 1-6)
STRELLITA J. TAMANO, petitioner, vs. HON. RODOLFO A. ORTIZ, Presiding Judge, RTC-Br. 89, Quezon City, HAJA PUTRI ZORAYDA A.
TAMANO, ADIB A. TAMANO and the HON. COURT OF APPEALS, respondents.
DECISION
BELLOSILLO, J.:
This Petition for Review on Certiorari seeks to reverse and set aside the decision of the Court of Appeals of 30 September 1996 in
CA-G.R. SP. No. 39656 which affirmed the decision of the Regional Trial Court-Br. 89, Quezon City, denying the motion to dismiss as well as
the motion for reconsideration filed by petitioner Estrellita J. Tamano.
On 31 May 1958 Senator Mamintal Abdul Jabar Tamano (Tamano) married private respondent Haja Putri Zorayda A. Tamano
(Zorayda) in civil rites. Their marriage supposedly remained valid and subsisting until his death on 18 May 1994. Prior to his death,
particularly on 2 June 1993, Tamano also married petitioner Estrellita J. Tamano (Estrellita) in civil rites in Malabang, Lanao del Sur.
On 23 November 1994 private respondent Zorayda joined by her son Adib A. Tamano (Adib) filed a Complaint for Declaration of
Nullity of Marriage of Tamano and Estrellita on the ground that it was bigamous. They contended that Tamano and Estrellita
misrepresented themselves as divorced and single, respectively, thus making the entries in the marriage contractfalse and fraudulent.
Private respondents alleged that Tamano never divorced Zorayda and that Estrellita was not single when she married Tamano as
the decision annulling her previous marriage with Romeo C. Llave never became final and executory for non-compliance with publication
requirements.
Estrellita filed a motion to dismiss alleging that the Regional Trial Court of Quezon City was without jurisdiction over the subject and
nature of the action. She alleged that "only a party to the marriage" could file an action for annulment of marriage against the other
spouse,[1] hence, it was only Tamano who could file an action for annulment of their marriage. Petitioner likewise contended that since
Tamano and Zorayda were both Muslims and married in Muslim rites the jurisdiction to hear and try the instant case was vested in
the sharia courts pursuant to Art. 155 of the Code of Muslim Personal Laws.
The lower court denied the motion to dismiss and ruled that the instant case was properly cognizable by the Regional Trial Court of
Quezon City since Estrellita and Tamano were married in accordance with the Civil Code and not exclusively in accordance with PD No.
1083[2] or the Code of Muslim Personal laws. The motion for reconsideration was likewise denied; hence, petitioner filed the instant
petition with this Court seeking to set aside the 18 July 1995 order of respondent presiding judge of the RTC-Br. 89, Quezon City, denying
petitioners motion to dismiss and the 22 August 1995 order denying reconsideration thereof.
In a Resolution dated 13 December 1995 we referred the case to the Court of Appeals for consolidation with G.R. No.
118371. Zorayda and Adib A. Tamano however filed a motion, which the Court of Appeals granted, to resolve the Complaint for
Declaration of Nullity of Marriage ahead of the other consolidated cases.
The Court of Appeals ruled that the instant case would fall under the exclusive jurisdiction of sharia courts only when filed in places
where there are sharia courts. But in places where there are no sharia courts, like Quezon City, the instant case could properly be filed
before the Regional Trial Court.
Petitioner is now before us reiterating her earlier argument that it is the sharia court and not the Regional Trial Court which has
jurisdiction over the subject and nature of the action.
Under The Judiciary Reorganization Act of 1980,[3] Regional Trial Courts have jurisdiction over all actions involving the contract
of marriage and marital relations.[4] Personal actions, such as the instant complaint for declaration of nullity of marriage, may be
commenced and tried where the plaintiff or any of the principal plaintiffs resides, or where the defendant or any of the principal
defendants resides, at the election of the plaintiff.[5] There should be no question by now that what determines the nature of an action
and correspondingly the court which has jurisdiction over it are the allegations made by the plaintiff in this case.[6] In the complaint for
declaration of nullity of marriage filed by private respondents herein, it was alleged that Estrellita and Tamano were married in
accordance with the provisions of the Civil Code. Never was it mentioned that Estrellita and Tamano were married under Muslim laws or
PD No. 1083. Interestingly, Estrellita never stated in her Motion to Dismiss that she and Tamano were married under Muslim laws. That
she was in fact married to Tamano under Muslim laws was first mentioned only in her Motion for Reconsideration.
Nevertheless, the Regional Trial Court was not divested of jurisdiction to hear and try the instant case despite the allegation in
the Motion for Reconsideration that Estrellita and Tamano were likewise married in Muslim rites. This is because a courts jurisdiction
cannot be made to depend upon defenses set up in the answer, in a motion to dismiss, or in a motion for reconsideration, but only upon
the allegations of the complaint.[7] Jurisdiction over the subject matter of a case is determined from the allegations of the complaint as the
latter comprises a concise statement of the ultimate facts constituting the plaintiffs causes of action.[8]
Petitioner argues that the sharia courts have jurisdiction over the instant suit pursuant to Art. 13, Title II, PD No. 1083, [9] which
provides -
Art. 13. Application. - (1) The provisions of this Title shall apply to marriage and divorce wherein both parties are Muslims, or
wherein only the male party is a Muslim and the marriage is solemnized in accordance with Muslim law or this Code in any
part of the Philippines.
(2) In case of a marriage between a Muslim and a non-Muslim, solemnized not in accordance with Muslim law or this Code,
the Civil Code of the Philippines shall apply.
 (3) Subject to the provisions of the preceding paragraphs, the essential requisites and legal impediments to marriage, divorce,
paternity and filiation, guardianship and custody of minors, support and maintenance, claims for customary dower (mahr),
betrothal, breach of contract to marry, solemnization and registration of marriage and divorce, rights and obligations
between husband and wife, parental authority, and the property relations between husband and wife shall be governed by
this Code and other applicable Muslim laws.
As alleged in the complaint, petitioner and Tamano were married in accordance with the Civil Code. Hence, contrary to the position
of petitioner, the Civil Code is applicable in the instant case. Assuming that indeed petitioner and Tamano were likewise married under
Muslim laws, the same would still fall under the general original jurisdiction of the Regional Trial Courts.
Article 13 of PD No. 1083 does not provide for a situation where the parties were married both in civil and Muslim
rites. Consequently, the sharia courts are not vested with original andexclusive jurisdiction when it comes to marriages celebrated
under both civil and Muslim laws. Consequently, the Regional Trial Courts are not divested of their general original jurisdiction under Sec.
19, par. (6) of BP Blg. 129 which provides -
Sec. 19. Jurisdiction in Civil Cases. - Regional Trial Courts shall exercise exclusive original jurisdiction: x x x (6) In all cases not
within the exclusive jurisdiction of any court, tribunal, person or body exercising judicial or quasi-judicial functions x x x x
WHEREFORE, the instant petition is DENIED. The decision of the Court of Appeals sustaining the 18 July 1995 and 22 August 1995
orders of the Regional Trial Court - Br. 89, Quezon City, denying the motion to dismiss and reconsideration thereof, is AFFIRMED. Let the
records of this case be immediately remanded to the court of origin for further proceedings until terminated.
SO ORDERED.
Davide, Jr., (Chairman), Vitug, Panganiban, and Quisumbing, JJ., concur.
LOMENA DOMAGAS, petitioner, vs. VIVIAN LAYNO JENSEN, respondent.
DECISION
CALLEJO, SR., J.:
This is a petition for review on certiorari, under Rule 45 of the Rules of Court, of the Decision[1] of the Court of Appeals (CA) in CA-
G.R. CV No. 73995, which affirmed the Decision[2] of the Regional Trial Court (RTC) of Dagupan City, Branch 44, in Civil Case No. 2000-
0244-D, which declared null and void the decision of the Municipal Trial Court (MTC) of Calasiao, Pangasinan in Civil Case No. 879.[3]
The antecedent facts follow.
On February 19, 1999, petitioner Filomena Domagas filed a complaint for forcible entry against respondent Vivian Jensen before
the MTC of Calasiao, Pangasinan. The petitioner alleged in her complaint that she was the registered owner of a parcel of land covered by
Original Certificate of Title (OCT) No. P-30980, situated in Barangay Buenlag, Calasiao, Pangasinan, and with an area of 827 square meters.
On January 9, 1999 the respondent, by means of force, strategy and stealth, gained entry into the petitioners property by excavating a
portion thereof and thereafter constructing a fence thereon. As such, the petitioner was deprived of a 68-square meter portion of her
property along the boundary line. The petitioner prayed that, after due proceedings, judgment be rendered in her favor, thus:
3. And, after trial, judgment be rendered:
a) DECLARING the writ of Preliminary Mandatory Injunction and Writ of Preliminary Injunction permanent;
b) ORDERING defendant, his representatives, agents and persons acting under her, to vacate the portion of the
property of the plaintiff occupied by them and to desist from entering, excavating and constructing in the said
property of the plaintiff described in paragraph 2 hereof and/or from disturbing the peaceful ownership and
possession of the plaintiff over the said land, pending the final resolution of the instant action;
c) ORDERING defendant to pay reasonable rental at FIVE THOUSAND (P5,000.00) PESOS per month from January 9,
1999 up to the time she finally vacates and removes all constructions made by her in the property of the
plaintiff and up to the time she finally restores the said property in the condition before her illegal entry,
excavation and construction in the property of the plaintiff;
d) ORDERING defendant to pay actual damages in the amount of TWENTY THOUSAND (P20,000.00) PESOS; moral
damages in the amount of TWENTY THOUSAND (P20,000.00) PESOS; attorneys fees of THIRTY THOUSAND
(P30,000.00) PESOS in retainers fee and ONE THOUSAND FIVE HUNDRED (P1,500.00) PESOS per court
appearance fee; exemplary damages in the amount of TWENTY THOUSAND (P20,000.00) PESOS, and, costs.
Plaintiff further prays for other reliefs and remedies just and equitable in the premises.[4]
The case was docketed as Civil Case No. 879. The summons and the complaint were not served on the respondent because the
latter was apparently out of the country. This was relayed to the Sheriff by her (the respondents) brother, Oscar Layno, who was then in
the respondents house at No. 572 Barangay Buenlag, Calasiao, Pangasinan. The Sheriff left the summons and complaint with Oscar Layno,
who received the same.[5]
Nonetheless, on May 17, 1999, the court rendered judgment ordering the respondent and all persons occupying the property for
and in the latters behalf to vacate the disputed area and to pay monthly rentals therefor, including actual damages, attorneys fees, and
exemplary damages. The fallo of the decision reads:
1) Ordering the defendant, her representatives, agents and persons acting under her, to vacate the 68-square meters which
she encroached upon;
2) Ordering the defendant to pay a monthly rental of P1,000.00 to the plaintiff;
3) To pay plaintiff actual damages of P20,000.00; attorneys fees of P15,000.00 and exemplary damages in the amount
of P20,000.00 plus the costs.
SO ORDERED.[6]
The respondent failed to appeal the decision. Consequently, a writ of execution was issued on September 27, 1999.
On August 16, 2000, the respondent filed a complaint against the petitioner before the RTC of Dagupan City for the annulment of
the decision of the MTC in Civil Case No. 879, on the ground that due to the Sheriffs failure to serve the complaint and summons on her
because she was in Oslo, Norway, the MTC never acquired jurisdiction over her person. The respondent alleged therein that the service of
the complaint and summons through substituted service on her brother, Oscar Layno, was improper because of the following: (a) when
the complaint in Civil Case No. 879 was filed, she was not a resident of Barangay Buenlag, Calasiao, Pangasinan, but of Oslo, Norway, and
although she owned the house where Oscar Layno received the summons and the complaint, she had then leased it to Eduardo Gonzales;
(b) she was in Oslo, Norway, at the time the summons and the complaint were served; (c) her brother, Oscar Layno, was merely visiting
her house in Barangay Buenlag and was not a resident nor an occupant thereof when he received the complaint and summons; and (d)
Oscar Layno was never authorized to receive the summons and the complaint for and in her behalf.[7]
The respondent further alleged that the MTC had no jurisdiction over the subject matter of the complaint in Civil Case No. 879
because the petitioner, the plaintiff therein, failed to show prior possession of the property. She further claimed that the alleged forcible
entry was simply based on the result of the survey conducted by Geodetic Engineer Leonardo de Vera showing that the property of the
respondent encroached on that of the petitioner.
The respondent filed a Manifestation dated August 31, 2000, and appended thereto the following: (a) a copy[8] of her passport
showing that she left the country on February 17, 1999; (b) a copy[9] of the Contract of Lease dated November 24, 1997, executed by her
and Eduardo D. Gonzales over her house for a period of three (3) years or until November 24, 2000; (c) her affidavit[10] stating, inter alia,
that she owned the house at Barangay Buenlag, Calasiao, Pangasinan, which she leased to Eduardo Gonzales; that she was married to Jarl
Jensen, a citizen of Norway, on August 23, 1987 and had resided in Norway with her husband since 1993; that she arrived in the
Philippines on December 31, 1998, but left on February 17, 1999; she returned to the Philippines on July 30, 2000 and learned, only then,
of the complaint against her and the decision of the MTC in Civil Case No. 879; her brother Oscar Layno was not a resident of the house at
Barangay Buenlag; and that she never received the complaint and summons in said case; (d) the affidavit[11] of Oscar Layno declaring that
sometime in April 1999, he was in the respondents house to collect rentals from Eduardo Gonzales; that the Sheriff arrived and served
him with a copy of the summons and the complaint in Civil Case No. 879; and that he never informed the respondent of his receipt of the
said summons and complaint; (e) an affidavit[12] of Eduardo Gonzales stating that he leased the house of the respondent and resided
thereat; the respondent was not a resident of the said house although he (Gonzales) allowed the respondent to occupy a room therein
whenever she returned to the Philippines as a balikbayan; and that Oscar Layno was not residing therein but only collected the rentals.
In her answer to the complaint, the petitioner alleged that the respondent was a resident of Barangay Buenlag, Calasiao,
Pangasinan and was the owner of the subject premises where Oscar Layno was when the Sheriff served the summons and complaint; that
the service of the complaint and summons by substituted service on the respondent, the defendant in Civil Case No. 879, was proper since
her brother Oscar Layno, a resident and registered voter of Barangay. Buenlag, Calasiao, Pangasinan, received the complaint and
summons for and in her behalf.
The petitioner appended the following to her answer: (a) a copy[13] of the Deed of Absolute Sale executed by Jose Layno in her
favor, dated August 26, 1992, showing that the respondent was a resident of Barangay Buenlag, Calasiao, Pangasinan; (b) a Real Estate
Mortgage[14] executed by the respondent, dated February 9, 1999 showing that she was a resident of Barangay Buenlag, Calasiao,
Pangasinan; (c) the Joint Affidavit[15] of Vicenta Peralta and Orlando Macalanda, both residents of Barangay Buenlag, Calasiao, Pangasinan,
declaring that the respondent and her brother Oscar Layno were their neighbors; that the respondent and her brother had been residents
of Barangay Buenlag since their childhood; that although the respondent left the country on several occasions, she returned to the
Philippines and resided in her house at No. 572 located in the said barangay; and (d) the Voters Registration Record [16] of Oscar Layno,
approved on June 15, 1997.
After due proceedings, the trial court rendered a decision in favor of the respondent. The dispositive portion reads:
WHEREFORE, judgment is rendered in favor of plaintiff Vivian Layno Jensen and against defendant Filomena Domagas, as follows:
1. The Decision of the Municipal Trial Court of Calasiao, Pangasinan in Civil Case No. 879, entitled Filomena Domagas versus Vivian
Layno Jensen is declared null and void, for lack of jurisdiction over the person of the plaintiff and the subject matter.
2. Defendant Filomena Domagas is ordered to pay plaintiff, the following:
a.) Actual damages, representing litigation expenses in the amount of P50,000.00;
b.) Attorneys fees in the amount of P50,000.00;
c.) Moral Damages in the amount of P50,000.00;
d.) Exemplary Damages in the amount of P50,000.00; and
 e.) Costs of suit.
SO ORDERED.[17]
The trial court declared that there was no valid service of the complaint and summons on the respondent, the defendant in Civil
Case No. 879, considering that she left the Philippines on February 17, 1999 for Oslo, Norway, and her brother Oscar Layno was never
authorized to receive the said complaint and summons for and in her behalf.
The petitioner appealed the decision to the CA which, on May 6, 2003, rendered judgment affirming the appealed decision with
modifications. The CA ruled that the complaint in Civil Case No. 879 was one for ejectment, which is an action quasi in rem. The appellate
court ruled that since the defendant therein was temporarily out of the country, the summons and the complaint should have been
served via extraterritorial service under Section 15 in relation to Section 16, Rule 14 of the Rules of Court, which likewise requires prior
leave of court. Considering that there was no prior leave of court and none of the modes of service prescribed by the Rules of Court was
followed by the petitioner, the CA concluded that there was really no valid service of summons and complaint upon the respondent, the
defendant in Civil Case No. 879.
Hence, the present petition.
The petitioner assails the decision of the CA, alleging that the appellate court erred in holding that the respondents complaint for
ejectment is an action quasi in rem. The petitioner insists that the complaint for forcible entry is an action in personam; therefore,
substituted service of the summons and complaint on the respondent, in accordance with Section 7, Rule 14 of the Rules of Court, is valid.
The petitioner, likewise, asserts that Oscar Layno is a resident and a registered voter of Barangay Buenlag, Calasiao, Pangasinan; hence,
the service of the complaint and summons on the respondent through him is valid.
The respondent, on the other hand, asserts that the action for forcible entry filed against her was an action quasi in rem, and that
the applicable provision of the Rules of Court is Section 15 of Rule 14, which calls for extraterritorial service of summons.
The sole issue is whether or not there was a valid service of the summons and complaint in Civil Case No. 879 on the respondent
herein who was the defendant in the said case. The resolution of the matter is anchored on the issue of whether or not the action of the
petitioner in the MTC against the respondent herein is an action in personam or quasi in rem.
The ruling of the CA that the petitioners complaint for forcible entry of the petitioner against the respondent in Civil Case No. 879 is
an action quasi in rem, is erroneous. The action of the petitioner for forcible entry is a real action and one in personam.
The settled rule is that the aim and object of an action determine its character. [18] Whether a proceeding is in rem, or in personam,
or quasi in rem for that matter, is determined by its nature and purpose, and by these only.[19] A proceeding in personam is a proceeding
to enforce personal rights and obligations brought against the person and is based on the jurisdiction of the person, although it may
involve his right to, or the exercise of ownership of, specific property, or seek to compel him to control or dispose of it in accordance with
the mandate of the court.[20] The purpose of a proceeding in personam is to impose, through the judgment of a court, some responsibility
or liability directly upon the person of the defendant.[21] Of this character are suits to compel a defendant to specifically perform some act
or actions to fasten a pecuniary liability on him.[22] An action in personam is said to be one which has for its object a judgment against the
person, as distinguished from a judgment against the propriety to determine its state. It has been held that an action in personam is a
proceeding to enforce personal rights or obligations; such action is brought against the person. As far as suits for injunctive relief are
concerned, it is well-settled that it is an injunctive act in personam.[23] In Combs v. Combs,[24] the appellate court held that proceedings to
enforce personal rights and obligations and in which personal judgments are rendered adjusting the rights and obligations between the
affected parties is in personam. Actions for recovery of real property are in personam.[25]
On the other hand, a proceeding quasi in rem is one brought against persons seeking to subject the property of such persons to the
discharge of the claims assailed.[26] In an action quasi in rem, an individual is named as defendant and the purpose of the proceeding is to
subject his interests therein to the obligation or loan burdening the property.[27] Actions quasi in rem deal with the status, ownership or
liability of a particular property but which are intended to operate on these questions only as between the particular parties to the
proceedings and not to ascertain or cut off the rights or interests of all possible claimants. The judgments therein are binding only upon
the parties who joined in the action.[28]
Section 1, Rule 70 of the Rules of Court provides:
Section 1. Who may institute proceedings, and when. - Subject to the provisions of the next succeeding section, a person deprived of the
possession of any land or building in force, intimidation, threat, strategy, or stealth, or a lessor, vendor, vendee, or other person against
whom the possession of any land or building is unlawfully withheld after the expiration or termination of the right to hold possession by
virtue of any contract, express or implied, or the legal representatives or assigns of any such lessor, vendor, vendee, or other person, may,
at any time within one (1) year after such unlawful deprivation or withholding of possession, bring an action in the proper Municipal Trial
Court against the person or persons unlawfully withholding or depriving of possession, or any person or persons claiming under them, for
the restitution of such possession, together with damages and costs.
Under Section 15, Rule 70 of the said Rule, the plaintiff may be granted a writ of preliminary prohibition or mandatory injunction:
Sec. 15. Preliminary Injunction. The court may grant preliminary injunction, in accordance with the provisions of Rule 58 hereof, to
prevent the defendant from committing further acts of dispossession against the plaintiff.
A possessor deprived of his possession through forcible entry or unlawful detainer may, within five (5) days from the filing of the
complaint, present a motion in the action for forcible entry or unlawful detainer for the issuance of a writ of preliminary mandatory
injunction to restore him in his possession. The court shall decide the motion within thirty (30) days from the filing thereof.
If, after due proceedings, the trial court finds for the plaintiff, it shall then render judgment in his or her favor, thus:
Sec. 17. Judgment. If, after trial, the court finds that the allegations of the complaint are true, it shall render judgment in favor of the
plaintiff for the restitution of the premises, the sum justly due as arrears of rent or as reasonable compensation for the use and
occupation of the premises, attorneys fees and costs. If it finds that said allegations are not true, it shall render judgment for the
defendant to recover his costs. If a counterclaim is established, the court shall render judgment for the sum found in arrears from either
party and award costs as justice requires.
From the aforementioned provisions of the Rules of Court and by its very nature and purpose, an action for unlawful detainer or
forcible entry is a real action and in personam because the plaintiff seeks to enforce a personal obligation or liability on the defendant
under Article 539 of the New Civil Code,[29] for the latter to vacate the property subject of the action, restore physical possession thereof
to the plaintiff, and pay actual damages by way of reasonable compensation for his use or occupation of the property.[30]
As gleaned from the averments of the petitioners complaint in the MTC, she sought a writ of a preliminary injunction from the MTC
and prayed that the said writ be made permanent. Under its decision, the MTC ordered the defendant therein (the respondent in this
case), to vacate the property and pay a monthly rental of P1,000.00 to the plaintiff therein (the petitioner in this case).
On the issue of whether the respondent was validly served with the summons and complaint by the Sheriff on April 5, 1999, the
petitioner asserts that since her action of forcible entry against the respondent in Civil Case No. 879 was in personam, summons may be
served on the respondent, by substituted service, through her brother, Oscar Layno, in accordance with Section 7, Rule 14 of the Rules of
Court. The petitioner avers that Oscar Layno, a person of suitable age and discretion, was residing in the house of the respondent on April
5, 1999. She avers that the fact that the house was leased to and occupied by Eduardo Gonzales was of no moment. Moreover, the Sheriff
is presumed to have performed his duty of properly serving the summons on the respondent by substituted service.
The contention of the petitioner has no merit.
In Asiavest Limited v. Court of Appeals,[31] the Court had the occasion to state:
In an action in personam, jurisdiction over the person of the defendant is necessary for the court to validly try and decide the case.
Jurisdiction over the person of a resident defendant who does not voluntarily appear in court can be acquired by personal service of
summons as provided under Section 7, Rule 14 of the Rules of Court. If he cannot be personally served with summons within a reasonable
time, substituted service may be made in accordance with Section 8 of said Rule. If he is temporarily out of the country, any of the
following modes of service may be resorted to: (a) substituted service set forth in Section 8; (2) personal service outside the country, with
leave of court; (3) service by publication, also with leave of court; or (4) any other manner the court may deem sufficient.[32]
Thus, any judgment of the court which has no jurisdiction over the person of the defendant is null and void.[33]
In the present case, the records show that the respondent, before and after his marriage to Jarl Jensen on August 23, 1987,
remained a resident of Barangay Buenlag, Calasiao, Pangasinan. This can be gleaned from the Deed of Absolute Sale dated August 26,
1992 in which she declared that she was a resident of said barangay. Moreover, in the Real Estate Mortgage Contract dated February 9,
1999, ten days before the complaint in Civil Case No. 879 was filed, the petitioner categorically stated that she was a Filipino and a
resident of Barangay Buenlag, Calasiao, Pangasinan. Considering that the respondent was in Oslo, Norway, having left the Philippines on
February 17, 1999, the summons and complaint in Civil Case No. 879 may only be validly served on her through substituted service under
Section 7, Rule 14 of the Rules of Court, which reads:
SEC. 7. Substituted service. If, for justifiable causes, the defendant cannot be served within a reasonable time as provided in the preceding
section, service may be effected (a) by leaving copies of the summons at the defendants residence with some person of suitable age and
discretion then residing therein, or (b) by leaving the copies at defendants office or regular place of business with some competent person
in charge thereof.
Strict compliance with the mode of service is required in order that the court may acquire jurisdiction over the person of the
defendant.[34] The statutory requirement of substituted service must be followed faithfully and strictly and any substituted service other
than that authorized by the statute is rendered ineffective.[35] As the Court held in Hamilton v. Levy:[36]
The pertinent facts and circumstances attendant to the service of summons must be stated in the proof of service or Officers Return;
otherwise, any substituted service made in lieu of personal service cannot be upheld. This is necessary because substituted service is in
derogation of the usual method of service. It is a method extraordinary in character and hence may be used only as prescribed and in the
circumstances authorized by statute. Here, no such explanation was made. Failure to faithfully, strictly, and fully comply with the
requirements of substituted service renders said service ineffective.[37]
In Keister v. Narcereo,[38] the Court held that the term dwelling house or residence are generally held to refer to the time of service;
hence, it is not sufficient to leave the summons at the formers dwelling house, residence or place of abode, as the case may be. Dwelling
house or residence refers to the place where the person named in the summons is living at the time when the service is made, even
though he may be temporarily out of the country at the time. It is, thus, the service of the summons intended for the defendant that must
be left with the person of suitable age and discretion residing in the house of the defendant. Compliance with the rules regarding the
service of summons is as much important as the issue of due process as of jurisdiction.[39]
The Return of Service filed by Sheriff Eduardo J. Abulencia on the service of summons reads:
Respectfully returned to the court of origin the herein summons and enclosures in the above-entitled case, the undersigned caused the
service on April 5, 1999.
Defendant Vivian Layno Jensen is out of the country as per information from her brother Oscar Layno, however, copy of summons and
enclosures was received by her brother Oscar Layno on April 5, 1999 as evidenced by his signature appearing in the original summons.
Calasiao, Pangasinan, April 6, 1999.
(Sgd.)
EDUARDO J. ABULENCIA
Junior Process Server[40]
As gleaned from the said return, there is no showing that as of April 5, 1999, the house where the Sheriff found Oscar Layno was
the latters residence or that of the respondent herein. Neither is there any showing that the Sheriff tried to ascertain where the residence
of the respondent was on the said date. It turned out that the occupant of the house was a lessor, Eduardo Gonzales, and that Oscar
Layno was in the premises only to collect the rentals from him. The service of the summons on a person at a place where he was a visitor
is not considered to have been left at the residence or place or abode, where he has another place at which he ordinarily stays and to
which he intends to return.[41]
The Voters Registration Record of Oscar Layno dated June 15, 1997 wherein he declared that he was a resident of No. 572 Barangay
Buenlag, Calasiao, Pangasinan, as well as the Joint Affidavit of Vicenta Peralta and Orlando Macasalda cannot prevail over the Contract of
Lease the respondent had executed in favor of Eduardo Gonzales showing that the latter had resided and occupied the house of the
respondent as lessee since November 24, 1997, and the affidavit of Eduardo Gonzales that Oscar Layno was not residing in the said house
on April 5, 1999.
In sum, then, the respondent was not validly served with summons and the complaint in Civil Case No. 879 on April 5, 1999, by
substituted service. Hence, the MTC failed to acquire jurisdiction over the person of the respondent; as such, the decision of the MTC in
Civil Case No. 879 is null and void.
IN LIGHT OF ALL THE FOREGOING, the petition is DENIED for lack of merit. No costs.
SO ORDERED.
Puno, (Chairman), Austria-Martinez, Tinga, and Chico-Nazario, JJ., concur.
.R. No. 130316 January 24, 2007
ERNESTO V. YU and ELSIE O. YU, Petitioners,
vs.
BALTAZAR PACLEB,1 Respondent.
DECISION
CORONA, J.:
The present petition filed under Rule 45 of the Rules of Court originated from an action for forcible entry and damages filed by petitioners
Ernesto and Elsie Yu against respondent Baltazar Pacleb.
The antecedent facts follow.
Sometime in September 1992, Ruperto Javier allegedly offered to sell Lot No. 6853-D to petitioners for P75 per sq.m.lawphil.net The lot
was approximately 18,000 square meters and was located in Barangay Langkaan, Dasmariñas, Cavite. Javier supposedly purchased the lot
from one Rebecca del Rosario who, in turn, acquired it from respondent and his wife. The title of the property (Transfer Certificate of Title
[TCT] No. T-118375), however, remained in the names of respondent and his wife. The instruments in support of the series of alleged
sales were not registered.
On September 11, 1992, petitioners accepted the offer and gave Javier P200,000 as downpayment for the lot. Javier then delivered his
supposed muniments of title to petitioners. After the execution of a contract to sell, he formally turned over the property to petiti oners.
At the time of the turn-over, a portion of the lot was occupied by Ramon C. Pacleb, respondent’s son, and his wife as tenants. On
September 12, 1992, Ramon and his wife allegedly surrendered possession of their portion to petitioners. Later on, petitioners appointed
Ramon as their trustee over the subject lot.
Aside from taking possession of the property, petitioners also caused the annotation on TCT No. T-118375 of a decision rendered in their
favor in Civil Case No. 741-93.2 This decision attained finality on April 19, 1995.
Petitioners alleged that they exercised ownership rights as well as enjoyed open, public and peaceful possession over the property from
September 12, 1992 until the early part of September 1995. During this time, respondent was in the United States.
Upon respondent’s return to the Philippines in May 1995, he allegedly entered the property by means of force, threat, intimidation,
strategy and stealth thereby ousting petitioners and their trustee, Ramon.
Despite repeated demands, respondent, asserting his rights as registered owner of the property, refused to vacate the premises and
surrender its possession to petitioners.
Petitioners filed an action for forcible entry3 in the Municipal Trial Court (MTC) of Dasmariñas, Cavite on November 23, 1995. Respondent
filed an answer with compulsory counterclaim dated December 8, 1995. After the issues were joined, the MTC required the submission of
the parties’ position papers at a preliminary conference on March 11, 1996. Respondent failed to comply.
On June 17, 1996, the MTC ruled:
WHEREFORE, in view of the foregoing, the [respondent] and other persons claiming right under him are hereby ordered to surrender
physical possession of Lot No. 6853-D in favor of the [petitioners] and to pay the sum of TWENTY-FIVE THOUSAND (P25,000.00) PESOS as
attorney’s fees.
SO ORDERED.4
On appeal,5 the Regional Trial Court (RTC) of Imus, Cavite rendered a decision affirming the MTC decision in toto.6
Respondent elevated his case to the Court of Appeals (CA)7 which rendered the assailed decision on March 18, 1997:
WHEREFORE, the Petition is GRANTED; the Decision dated October 25, 1996 of the [RTC] of Imus, Cavite in Civil Case No. 052-96 and the
Decision of the [MTC] of Dasmariñas, Cavite in Civil Case No. 182 are SET ASIDE; and Civil Case No. 182 for Forcible Entry and Damages is
hereby ordered DISMISSED. No pronouncement as to costs.
SO ORDERED.8
In a resolution dated August 20, 1997, the CA denied petitioners’ motion for reconsideration for lack of merit.
Before us now come petitioners who claim that the appellate court erred in finding that respondent had prior physical possession of the
subject property.lawphil.net
"In an action for forcible entry, the plaintiff must prove that he was in prior possession of the land or building and that he was deprived
thereof by means of force, intimidation, threat, strategy or stealth."9 The plaintiff, however, cannot prevail where it appears that, as
between himself and the defendant, the latter had possession antedating his own.10 We are generally precluded in a Rule 45 petition from
reviewing factual evidence tracing the events prior to the first act of spoliation.11 However, the conflicting factual findings of the MTC and
RTC on one hand, and the CA on the other, require us to make an exception.
We overrule petitioners’ contentions.
The Civil Code states that possession is the holding of a thing or the enjoyment of a right. 12 In the grammatical sense, to possess means to
have, to actually and physically occupy a thing, with or without right.13 "Possession always includes the idea of occupation x x x. It is not
necessary that the person in possession should himself be the occupant. The occupancy can be held by another in his name." 14 Without
occupancy, there is no possession.15
Two things are paramount in possession.16 First, there must be occupancy, apprehension or taking. Second, there must be intent to
possess (animus possidendi).17
Here, petitioners failed to establish that they had prior physical possession to justify a ruling in their favor in the complaint for forcible
entry against respondent.
In the decision in Civil Case No. 741-93 (a case for specific performance and damages against Javier, the alleged vendor of the lot in
question) upon which petitioners based their right to possess in the first place, the trial court categorically stated:
The [petitioners were never placed] in possession of the subject property on which [was] planned to be [site of] a piggery, nor [were
they] given a clearance or certification from the Municipal Agrarian Reform Officer.18(emphasis ours)
The claim that the lot was turned over to petitioners in 1992 was self-serving in the face of this factual finding. On the other hand, the tax
declarations and receipts in the name of respondent in 1994 and 1995 established the possession of respondent.19 The payment of real
estate tax is one of the most persuasive and positive indications showing the will of a person to possess in concepto de dueño or with
claim of ownership.20
"[P]ossession in the eyes of the law does not mean that a man has to have his feet on every square meter of the ground before he is
deemed in possession."21 In this case, Ramon, as respondent’s son, was named caretaker when respondent left for the United States in
1983.22 Due to the eventual loss of trust and confidence in Ramon, however, respondent transferred the administration of the land to his
other son, Oscar, in January 1995 until his return in May 1995.23 In other words, the subject land was in the possession of the
respondent’s sons during the contested period.
Petitioners cite an alleged document (Kusangloob na Pagsasauli ng Lupang Sakahan at Pagpapahayag ng Pagtalikod sa Karapatan) dated
March 10, 1995 executed by them and Ramon to prove a turn over of possession. They also seek to prove their exercise of rights over the
land through alleged frequent visits and the designation of Ramon as their own trustee as declared in a joint affidavit attached to their
position paper filed with the MTC. These instruments, however, fail to convince us of petitioners’ actual occupancy of the subject land.
First, petitioners themselves acknowledged that Ramon and his wife occupied part of the land as tenants of respondent. Second, Ramon,
a mere tenant, had no authority to sign such document dated March 10, 1995 waiving all rights to the land. Third, there was no clear
proof in the records of the appointment of Ramon as petitioners’ trustee save their self-serving statements to this effect. Finally, at the
time the Kusangloob na Pagsasauli document was executed, the caretaker of the land was no longer Ramon but Oscar.24
Most important, the title of the land in question (TCT No. T-118375) remained in the name of respondent.25 "As the registered owner,
petitioner had a right to the possession of the property, which is one of the attributes of ownership."26 The Civil Code states:
Art. 538. Possession as a fact cannot be recognized at the same time in two different personalities except in the cases of co-possession.
Should a question arise regarding the fact of possession, the present possessor shall be preferred; if there are two possessors, the one
longer in possession; if the dates of the possession are the same, the one who presents a title; and if all these conditions are equal, the
thing shall be placed in judicial deposit pending determination of its possession or ownership through proper proceedings.
In view of the evidence establishing respondent’s continuing possession of the subject property, petitioners’ allegation that respondent
deprived them of actual possession by means of force, intimidation and threat was clearly untenable. In Gaza v. Lim, we held that:
Where a dispute over possession arises between two persons, the person first having actual possession is the one who is entitled to
maintain the action granted by law; otherwise, a mere usurper without any right whatever, might enter upon the property of another
and, by allowing himself to be ordered off, could acquire the right to maintain the action of forcible entry and detainer, however
momentary his intrusion might have been.27
WHEREFORE, the petition is hereby DENIED. The decision of the Court of Appeals dated March 18, 1997 in CA-G.R. SP No. 42604
is AFFIRMED.
Costs against petitioners.
SO ORDERED.
RENATO C. CORONA
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice
Chairperson
REBECCA T. CABUTIHAN, petitioner, vs. LANDCENTER CONSTRUCTION & DEVELOPMENT CORPORATION, respondent.
DECISION
PANGANIBAN, J.:
Breach of contract gives rise to a cause of action for specific performance or for rescission. A suit for such breach is not capable of
pecuniary estimation; hence, the assessed value of the real estate, subject of the said action, should not be considered in computing the
filing fees. Neither a misjoinder nor a non-joinder of parties is a ground for dismissal of an action, because parties may be dropped or
added at any stage of the proceedings.
The Case
Before us is a Petition for Review on Certiorari under Rule 45, assailing the Orders dated September 8, 2000 and November 21,
2000, promulgated by of the Regional Trial Court (RTC) of Pasig City, Branch 263.[1] The first assailed Order disposed as follows:
WHEREFORE, foregoing premises considered, this Court hereby resolves to dismiss the instant complaint.[2]
Reconsideration was denied in the second challenged Order.[3]
The Facts
Culled from the pleadings, the facts of this case are as follows.
On December 3, 1996, herein respondent Landcenter Construction & Development Corporation, represented by Wilfredo
B.Maghuyop -- entered into an Agreement[4] with Petitioner Rebecca Cabutihan.The Agreement stipulates:
WHEREAS, [respondent corporation], x x x is the absolute owner, x x x of a parcel of land situated at Kay-biga, Paranaque, Metro Manila
covered under Transfer Certificate of Title No. (S-30409) (partially cancelled by TCT Nos. 110001 to 110239) and particularly described as
follows:
A parcel of land (Plan Psu-80206, Case No. 290, G.L.R.O. Record No. 2291), situated in the Barrio of Kay-biga, Municipality of Paranaque,
Province of Rizal. Bounded on the NE., by properties of Eulogio Cruz and Isidro Alano; on the E., by property of Justo Bernardo; on the SE.,
by properties of Marcelo Nofuente and Lorenzo Molera; on the SW., by properties of Higino and Pedro P. Lopez; on the W., by property of
Odon Rodriguez; and on the NW., by properties of Evaristo de los Santos and Pastor Leonardo.....; containing an area of ONE HUNDRED
SEVEN THOUSAND AND FORTY SEVEN (107,047) SQUARE METERS, more or less.
WHEREAS, [respondent corporation] decided to engage the assistance of [petitioner] and x x x herein called the FACILITATOR for the
purpose of facilitating and arranging the recovery of the property in question, as well as the financing of such undertakings necessary in
connection thereto;
WHEREFORE, premises considered and of the mutual covenants of the parties, they have agreed, as follows:
1. The FACILITATOR undertakes to effect the recovery of the property subject hereof, including the financing of the
undertaking, up to the registration of the same in the name of [respondent corporation], except any and all taxes due;
2. The FACILITATOR shall be responsible for whatever arrangements necessary in relation to the squatters presently
occupying [a] portion of the property, as well as the legitimate buyers of lots thereof;
3. As compensation for the undertaking of the FACILITATOR, [she] shall be entitled to Twenty [Percent] (20%) of the total
area of the property thus recovered for and in behalf of [respondent corporation].
xxx xxx xxx.[5]
Armed with Board Resolution No. 01, Series of 1997,[6] which had authorized her to represent the corporation, Luz Baylon Ponce
entered into a February 11, 1997 Deed of Undertaking with a group composed of petitioner, Wenifredo P. Forro, Nicanor Radan Sr. and
Atty. Prospero A. Anave. The Deed states the following:
WHEREAS, the UNDERTAKER [respondent corporation] solicited, engaged and hereby voluntarily acknowledges the assistance of certain
persons, in recovering, arranging and financing the undertaking up to completion/consummation of the same;
WHEREAS, the UNDERTAKER freely, voluntarily, unconditionally and irrevocably agreed, committed and undertook to compensate x x x
said persons, in the manner, specified hereinbelow;
WHEREFORE, considering the foregoing premises, and the mutual covenants of the parties, the UNDERTAKER hereby unconditionally and
irrevocably [c]ommit[s] and [u]ndertake[s], as follows:
1. To pay or compensate the following persons, based on the gross area of the afore-described parcel of land or gross proceeds of the sale
thereof, as the case may be, to wit:
Rebecca T. Cabutihan ------------------------------------ 20%
Wenifredo P. Forro ----------------------------------- 10%
Nicanor Radan, Sr. ------------------------------------ 4%
Atty. Prospero A. Anave ----------------------------------- 2.5%
TOTAL ----------------------------------- 36.5%
2. Execute a Deed of Assignment unto and in favor of each of the persons above-mentioned corresponding to their respective shares in
the subject parcel of land or in the proceeds thereof;
3. This Undertaking as well as the Deed of Assignment above-stated shall be effective and binding upon the heirs, successors-in-interest,
assigns or designates of the parties herein.[7]
An action for specific performance with damages was filed by petitioner on October 14, 1999 before the RTC of Pasig City, Branch
263. She alleged:
[6.] [Petitioner] accomplished her undertakings under the subject Agreement and the Undertaking. So in a letter dated 18 April 1997, x x
x, [respondent corporation] was informed accordingly thereof.Simultaneously, [petitioner] demanded upon [respondent corporation] to
execute the corresponding Deed of Assignment of the lots in the subject property, as compensation for the services rendered in favor of
the [respondent corporation]. The subject letter was duly received and acknowledged receipt, by then Acting Corporate Secretary of the
[respondent corporation].
[7.] [Respondent corporation] failed and refused to act on x x x said demand of [petitioner]. Hence, [she] sent a letter dated May 8, 1997,
to the Register of Deeds for Paranaque, to inform x x x said Office of x x x [her] claim x x x;
[8.] x x x [T]he subject property was already transferred to and registered in the name of [respondent corporation] under Transfer
Certificate of Title No. -123917-, of the Registry of Deeds for Paranaque City x x x;
xxx xxx xxx
[10.] With x x x said title of the property now in the possession of the [respondent corporation], [petitioner] is apprehensive that the more
that [she] will not be able to obtain from [respondent corporation], compliance with the afore-stated Agreement and Undertaking, to the
extreme detriment and prejudice of [petitioner] and her group, x x x;
xxx xxx xxx
[12.] Then in a letter,[8] dated 10 September 1999, [petitioner] through counsel sent to [respondent corporation] a Formal Demand, to
comply with its obligation x x x but x x x [respondent corporation] did not heed the demand. x x x.[9]
Petitioner prayed, inter alia, that respondent corporation be ordered to execute the appropriate document assigning, conveying,
transferring and delivering the particular lots in her favor. The lots represented compensation for the undertakings she performed and
accomplished, as embodied in the Agreement.
Respondent then filed a Motion to Dismiss, alleging the following:
5. Because of the troubled situation obtaining at the management level of [respondent corporation], the sale between [respondent
corporation] and PCIB regarding the Fourth Estate Subdivision was not registered with the Register of Deeds office, although [respondent
corporation] continued holding the deed of sale over the Fourth Estate Subdivision.
6. A group of persons led by one Wilfredo Maghuyop, including herein [petitioner], Wenifredo Forro, Nicanor Radan, and others, taking
advantage of the management mess at [respondent corporation], tried to grab ownership of the [respondent corporation], and with use
of fraud, cheat, misrepresentation and theft of vital documents from the office of [respondent corporation], succeeded in filing with the
Securities and Exchange Commission false papers and documents purporting to show that the Articles of Incorporation of [respondent
corporation] had been amended, installing Maghuyop as president of [respondent corporation]. It was on these occasions that
[petitioner] and her companions x x x, with use of fraud, stealth, tricks, deceit and cheat succeeded in letting Luz Baylon Ponce sign a so-
called Deed of Undertaking by virtue of which [respondent corporation] is duty-bound to give to [petitioner], Forro, Radan and Atty.
Prospero Anave 36.5% of the land area of the Fourth Estate Subdivision as compensation for alleged services and expenses made by these
people in favor of [respondent corporation]. They also caused said x x x Maghuyop to sign an Agreement with [petitioner] expressing an
obligation on the part of [respondent corporation] to give a big part of the land x x x to [petitioner]. These Agreement and Deed of
Undertaking are being made by herein [petitioner] as her causes of action in the present case.
Wilfredo Maghuyop was a stranger to [respondent corporation], and he was an impostor used by [petitioner] and her companions to
barge into the management of [respondent corporation] for the purpose of stealing and creating an obligation against [respondent
corporation] in their favor.
7. But Luz Baylon Ponce, whose signature appears on the instrument denominated as Deed of Undertaking, vehemently denies that she
signed said instrument freely and voluntarily. She says that Wenifredo Forro and Nicanor Radan were once real estate agents of
[respondent corporation] who promised to help sell lots from her project Villaluz II Subdivision located [in] Malibay, Pasay City. According
to Luz Baylon Ponce, the Board of Directors of [respondent corporation] negotiated with Forro and Radan for the latter to sell units/lots of
Villaluz II Subdivision, and to help obtain a financier who would finance for the expenses for the reconstitution of the lost title of the
Fourth Estate Subdivision situated [in] Sucat, Paranaque City. Shortly thereafter, these two men resigned from [respondent corporation]
as agents, after they manipulated the signing of x x x said Deed of Undertaking by Luz Baylon Ponce on February 11, 1997. The latter is an
old woman 80 years of age. She is weak, has x x x poor sight, and is feeble in her mental ability. Forro and Radan inserted the Deed of
Undertaking among the papers intended for application for reconstitution of [respondent corporations] title which these men caused Luz
Baylon Ponce to sign, and she unknowingly signed the Deed of Undertaking. x x x.[10]
In the Motion, respondent sought the dismissal of the Complaint on the grounds of (1) improper venue, (2) lack of jurisdiction over
the subject matter, and (3) nonpayment of the proper docket fees.Specifically, it contended:
8. That venue is improperly laid
xxx xxx xxx
(b) In other words, the present case filed by [petitioner] is for her recovery (and for her companions) of 36.5% of [respondent
corporations] land (Fourth Estate Subdivision) or her interest therein. x x x therefore, x x x the present case filed x x x is a real action or an
action in rem.
(c) x x x [Following] Section 1, Rule 4 of the Rules of Court, as amended x x x the present case should have been filed by [petitioner] with
the proper court in Paranque City which has jurisdiction over the x x x Fourth Estate Subdivision because said subdivision is situated in
Paranaque City. Since [petitioner] filed the present case with this x x x [c]ourt in Pasig City, she chose a wrong venue x x x.
xxx xxx xxx
9. That the [c]ourt has no jurisdiction over the subject matter of the claim
xxx xxx xxx
(c) x x x Wenifredo P. Forro, Nicanor Radan, Sr. and Atty. Prospero A. Anave are not named as plaintiffs in the complaint. [Petitioner] x x x
is not named as representative of Forro, Radan and Anave by virtue of a Special Power of Attorney or other formal written
authority. According to the Rules, where the action is allowed to be prosecuted or defended by a representative or someone acting in a
fiduciary capacity, the beneficiary shall be included in the title of the case and shall be deemed to be the real party in interest (Sec. 3, Rule
3, Rules of Court, as amended x x x).
xxx xxx xxx
10. That a condition precedent for filing the claim has not been complied with
xxx xxx xxx
(b) Obviously, [petitioner] has not paid the docket or filing fees on the value of her land claim x x x. Thirty-six percent (36%) x x x
is P180,000,000.00, x x x.[11]
Ruling of the Trial Court
The RTC ruled that the allegations in the Complaint show that its primary objective was to recover real property. Equally important,
the prayer was to compel respondent to execute the necessary deeds of transfer and conveyance of a portion of the property
corresponding to 36.5 percent of its total area or, in the alternative, to hold respondent liable for the value of the said portion, based on
the prevailing market price. The RTC further ruled that, since the suit would affect the title to the property, it should have been instituted
in the trial court where the property was situated.[12]
Furthermore, the action was filed only by petitioner. There was no allegation that she had been authorized by Forro, Radan and
Anave to represent their respective shares in the compensation.
Finally, since this case was an action in rem, it was imperative for petitioner to pay the appropriate docket or filing fees equivalent
to the pecuniary value of her claim, a duty she failed to discharge.Consequently, following Manchester Development Corp. v. Court of
Appeals,[13] the trial court never acquired jurisdiction over the case.
Hence, this Petition.[14]
Issues
In her Memorandum, petitioner phrases the issue in this wise:
Whether or not the dismissal of the [C]omplaint was in accordance with the pertinent law and jurisprudence on the matter.[15]
She argues that the RTC erred in dismissing her Complaint on the grounds of (1) improper venue, (2) non-joinder of necessary
parties, and (3) non-payment of proper docket fees.
This Courts Ruling
The Petition is meritorious.
First Issue:
Proper Venue
Maintaining that the action is in personam, not in rem, petitioner alleges that the venue was properly laid. The fact that she
ultimately sought the conveyance of real property not located in the territorial jurisdiction of the RTC of Pasig is, she claims, an
anticipated consequence and beyond the cause for which the action was instituted.
On the other hand, the RTC ruled that since the primary objective of petitioner was to recover real property -- even though her
Complaint was for specific performance and damages -- her action should have been instituted in the trial court where the property was
situated, in accordance with Commodities Storage & Ice Plant Corp. v. Court of Appeals.[16]
We agree with petitioner. Sections 1 and 2, Rule 4 of the Rules of Court provide an answer to the issue of venue. [17] Actions
affecting title to or possession of real property or an interest therein (real actions), shall be commenced and tried in the proper court that
has territorial jurisdiction over the area where the real property is situated. On the other hand, all other actions, (personal actions) shall
be commenced and tried in the proper courts where the plaintiff or any of the principal plaintiffs resides or where the defendant or any of
the principal defendants resides.
In Commodities Storage cited earlier, petitioner spouses obtained a loan secured by a mortgage over their land and ice plant in Sta.
Maria, Bulacan. Because they had failed to pay the loan, the mortgage was foreclosed and the ice plant auctioned. Before the RTC of
Manila, they sued the bank for damages and for the fixing of the redemption period. Since the spouses ultimately sought redemption of
the mortgaged property, the action affected the mortgage debtors title to the foreclosed property; hence, it was a real action.[18] Where
the action affects title to the property, it should be instituted in the trial court where the property is situated.[19]
In National Steel Corp. v. Court of Appeals,[20] the Court held that an action in which petitioner seeks the execution of a deed of sale
of a parcel of land in his favor x x x has been held to be for the recovery of the real property and not for specific performance since his
primary objective is to regain the ownership and possession of the parcel of land.
However, in La Tondea Distillers, Inc. v. Ponferrada,[21] private respondents filed an action for specific performance with damages
before the RTC of Bacolod City. The defendants allegedly reneged on their contract to sell to them a parcel of land located in Bago City - -
a piece of property which the latter sold to petitioner while the case was pending before the said RTC. Private respondent did not claim
ownership but, by annotating a notice of lis pendens on the title, recognized defendants ownership thereof. This Court ruled that the
venue had properly been laid in the RTC of Bacolod, even if the property was situated in Bago.
In Siasoco v. Court of Appeals,[22] private respondent filed a case for specific performance with damages before the RTC of Quezon
City. It alleged that after it accepted the offer of petitioners, they sold to a third person several parcels of land located in Montalban,
Rizal. The Supreme Court sustained the trial courts order allowing an amendment of the original Complaint for specific performance with
damages. Contrary to petitioners position that the RTC of Quezon City had no jurisdiction over the case, as the subject lots were located in
Montalban, Rizal, the said RTC had jurisdiction over the original Complaint. The Court reiterated the rule that a case for specific
performance with damages is a personal action which may be filed in a court where any of the parties reside.
A close scrutiny of National Steel and Ruiz reveals that the prayers for the execution of a Deed of Sale were not in any way
connected to a contract, like the Undertaking in this case. Hence, even if there were prayers for the execution of a deed of sale, the
actions filed in the said cases were not for specific performance.
In the present case, petitioner seeks payment of her services in accordance with the undertaking the parties signed. Breach of
contract gives rise to a cause of action for specific performance or for rescission.[23] If petitioner had filed an action in rem for the
conveyance of real property, the dismissal of the case would have been proper on the ground of lack of cause of action.
Second Issue:
Non-Joinder of Proper Parties
Petitioner claims that she was duly authorized and empowered to represent the members of her group and to prosecute their
claims on their behalf via a Special Power of Attorney executed by Forro, Radan and Anave. Besides, she argues that the omission of her
companions as plaintiffs did not prevent the RTC from proceeding with the action, because whatever judgment would be rendered would
be without prejudice to their rights. In the alternative, she avers that the trial court may add or drop a party or parties at any stage of the
action and on such terms as are just.
The RTC ruled that there was no allegation anywhere in the records that petitioner had been authorized to represent Forro, Radan
and Anave, who were real parties-in-interest with respect to their respective shares of the 36.5 percent claim. Such being the case, the
trial court never acquired jurisdiction over the subject matter of their claims.
Again, we side with petitioner. Neither a misjoinder nor a non-joinder of parties is a ground for the dismissal of an action. Parties
may be dropped or added by order of the court, on motion of any party or on the courts own initiative at any stage of the action.[24] The
RTC should have ordered the joinder of such party, and noncompliance with the said order would have been ground for dismissal of the our)"
action.
Although the Complaint prayed for the conveyance of the whole 36.5 percent claim without impleading the companions of 2. CIVIL LAW; OBLIGATIONS AND CONTRACTS; CREDITORS; REMEDY AGAINST ABSCONDING DEBTORS. — The proper recourse for a
petitioner as party-litigants, the RTC could have separately proceeded with the case as far as her 20 percent share in the claim was creditor in the same situation as petitioner is to locate properties, real or personal, of the resident defendant debtor with unknown
concerned, independent of the other 16.5 percent. This fact means that her companions are not indispensable parties without whom no address and cause them to be attached under Rule 57, Sec. l(f), in which case, the enactment converts the action into a proceeding in rem
final determination can be had.[25] At best, they are mere necessary parties who ought to be impleaded for a complete determination or or quasi in rem and the summons by publication may then accordingly be deemed valid and effective But because debtors who abscond
settlement of the claim subject of the action.[26] The non-inclusion of a necessary party does not prevent the court from proceeding with and conceal themselves are also quite adept at concealing their properties, the dismissal of the case below by respondent Judge should be
the action, and the judgment rendered therein shall be without prejudice to the rights of such party.[27] set aside and the case held pending in the court’s archives, until petitioner as plaintiff succeed in determining the whereabouts of the
Third Issue: defendants’ person or properties and causes valid summons to be served personally or by publication as the case may be. In this manner,
Correct Docket Fees the tolling of the period of prescription for as long as the debtor remains in hiding would properly be a matter of court record, and he can
Petitioner insists that the value of the real property, which was the subject of the contract, has nothing to do with the not emerge after a sufficient lapse of time from the dismissal of the case to profit from his own misdeed and claim prescription of his just
determination of the correct docket or filing fees. debt.
The RTC ruled that although the amount of damages sought had not been specified in the body of the Complaint, one can infer
from the assessed value of the disputed land that it would amount to P50 million. Hence, when compared to this figure, the P210 paid as
docket fees would appear paltry. DECISION
We hold that the trial court and respondent used technicalities to avoid the resolution of the case and to trifle with the law. True,
Section 5, Rule 141 of the Rules of Court requires that the assessed value of the real estate, subject of an action, should be considered in
computing the filing fees. But the Court has already clarified that the Rule does not apply to an action for specific performance,[28] which is REYES, J.B.L., J.:
classified as an action not capable of pecuniary estimation.[29]
Besides, if during the course of the trial, petitioners 20 percent claim on the Fourth Estate Subdivision can no longer be satisfied
and the payment of its monetary equivalent is the only solution left, Sunlife Insurance Office, Ltd. v. Asuncion[30] holds as follows: Where Petitioner Citizens’ Surety & Insurance Company, Inc. seeks review of an order of respondent Judge in Civil Case No. 77134 of the Court of
the filing of the initiatory pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a First Instance of Manila, Branch XVII, entitled "Citizens’ Surety & Insurance Co., Inc. v. Santiago Dacanay and Josefina Dacanay," dismissing
reasonable time but in no case beyond the applicable prescriptive or reglementary period. the complaint for lack of proper service of summons upon defendants.
WHEREFORE, the Petition is hereby GRANTED, and the assailed Orders REVERSED and SET ASIDE. The case is REMANDED to the
court of origin which is ordered to PROCEED with deliberate speed in disposing of the case. No costs. The record is to the effect that petitioner had filed its complaint in the Court below, alleging that at request of defendant Santiago
SO ORDERED. Dacanay, the plaintiff Surety Company had issued its Surety Bonds Nos. 4942 and 4944, the first, in favor of Gregorio Fajardo to guarantee
Sandoval-Gutierrez, and Carpio, JJ., concur. payment of a P5,000-promissory note executed by said Dacanay, and the second, in favor of Manufacturers Bank & Trust Co., to
Puno, (Chairman), J., abroad, on official leave. guarantee payment of another promissory note in like amount; that in consideration of said bonds, Santiago and Josefina Dacanay
[G.R. No. L-32170. March 31, 1971.] executed Indemnity Agreements, binding themselves jointly and severally to indemnify plaintiff for any losses, costs and expenses which it
might sustain in connection with the issuance of the bonds aforesaid, with interest at 12% per annum; that as additional security, the
CITIZENS’ SURETY & INSURANCE COMPANY, INC., Petitioner, v. HON. JUDGE A. MELENCIO-HERRERA, SANTIAGO DACANAY, and Dacanays mortgaged to plaintiff a parcel of land in Baguio City, covered by Certificate of Title No. T-8116, the mortgage having been duly
JOSEFINA DACANAY, Respondents. recorded; that the promissory notes were not paid .and as a result, plaintiff Surety was compelled to pay P5,000.00 to Gregorio Fajardo
and P4,081.69 to the Manufacturers’ Bank; that the Dacanays failed to reimburse the Surety for such payments, whereupon the Surety
Dayos, Tesoro & Gloria, Jr. for Petitioner. caused the extrajudicial foreclosure of the mortgage to pay its claim of P12,941.69 representing its payments, interest and stipulated
liquidated damages: that at the foreclosure sale, the land mortgaged was sold to plaintiff, as highest bidder, for the sum of P2,000.00 —
Respondent Judge for and in his own behalf. leaving an unsatisfied balance of P10,491.69, that plaintiff sought to recover from defendants Dacanay, plus 10% thereof as attorneys’
fees, and the costs.

SYLLABUS At petitioner’s request, respondent Judge caused summons to be made by publication in the newspaper Philippines Herald. But despite
the publication and deposit of a prepaid copy of the complaint at the Manila post office, defendants did not appear within the period of
60 days from last publication, as required by the summons.
1. REMEDIAL LAW; JURISDICTION; ACTION IN PERSONAM; PERSONAL SERVICE OF SUMMONS REQUIRED. — We agree with respondent
Judge that the action of plaintiff petitioner, being in personam, the Court could not validly acquire jurisdiction on a non-appearing Plaintiff then asked that defendants be declared in default; but :instead, the Judge, by order of May 16, 1970, asked it to show cause why
defendant, absent a personal service of summons within the forum. We have explicitly so ruled in Pantaleon v. Asuncion, 105 Phil. 765, the action should not be dismissed, the suit being in personam and defendants not having appeared. Then, on May 29, 1970, respondent
pointing out without such personal service, any judgment on a non-appearing defendant would be violative of due process. In the Judge dismissed the case, despite plaintiff Surety’s argument that the summons by publication was sufficient and valid under section 16 of
aforecited case this Court, through Justice Roberto Concepcion, now Chief Justice, ruled as follows: . . . "It is a well-settled principle of Rule 14 of the Revised Rules of Court.
Constitutional Law that, in an action strictly in personam, like the one at bar, personal service of summons, within the forum, is essential
to the acquisition of jurisdiction over the person of the defendant, who does not voluntary submit himself to the authority of the court. In We agree with respondent Judge that the action of plaintiff petitioner, being in personam, the Court could not validly acquire jurisdiction
other words, summons by publication cannot — consistently with the due process clause in the Bill of Rights — confer upon the court on a non-appearing defendant, absent a personal service of summons within the forum. We have explicitly so ruled in Pantaleon v.
jurisdiction over said defendants.’Due process of law requires personal service to support a personal judgment, and, when the proceeding Asunción, 105 Phil. 765, pointing out without such personal service, any judgment on a non-appearing defendant would be violative of
is strictly in personam brought to determine the personal rights and obligations of the parties, personal service within the state or a due process. In the aforecited case this Court, through Justice Roberto Concepción, now Chief Justice, ruled as
voluntary appearance in the case is essential to the acquisition of jurisdiction so as to constitute compliance with the constitutional follows:jgc:chanrobles.com.ph
requirement of due process. . . .’Although a state legislature has more control over the form of service on its own residents than
nonresidents, it has been held that in actions in personam . . . service by publication on resident defendants who are personally within the "Apart from the foregoing, it is well-settled principle of Constitutional Law that, in an action strictly in personam, like the one at bar,
state and can be found therein is not "due process of law," and statute allowing it is unconstitutional.’ (16A C.J.S., pp. 786, 789; Emphasis personal service of summons, within the forum. is essential to the acquisition of jurisdiction over the person of the defendant, who does
not voluntarily submit himself to the authority of the court. In other words, summons by publication cannot — consistently with the due
process clause in the Bill of Rights — confer upon the court jurisdiction over said defendants.
‘Due process of law requires personal service to support a personal judgment, and. when the proceeding is strictly in personam brought to
determine the personal rights and obligations of the parties, personal service within the state or a voluntary appearance in the case is
essential to the acquisition of jurisdiction so as to constitute compliance with the constitutional requirement of due process. . . .
‘Although a state legislature has more control over the form of service on its own residents than nonresidents, it has been held that in
actions in personam . . . service by publication on resident defendants, who are personally within the state and can be found therein is not
"due process of law," and a statute allowing it is unconstitutional.’ (16A C.J.S., pp. 786, 789; Emphasis ours.)"
The proper recourse for a creditor in the same situation as petitioner is to locate properties, real or personal, of the resident defendant
debtor with unknown address and cause them to be attached under Rule 57, section 1(f), in which case, the attachment converts the
action into a proceeding in rem or quasi in rem and the summons by publication may then accordingly be deemed valid and effective.
But because debtors who abscond and conceal themselves are also quite adept at concealing their properties, the dismissal of the case
below by respondent Judge should be set aside and the case held pending in the court’s archives, until petitioner as plaintiff succeeds in
determining the whereabouts of the defendants’ person or properties and causes valid summons to be served personally or by
publication as the case may be. In this manner, the tolling of the period of prescription for as long as the debtor remains in hiding would
properly be a matter of court records and he can not emerge after a sufficient lapse of time from the dismissal of the case to profit from
his own misdeed and claim prescription of his just debt.
WHEREFORE, the order of dismissal of the case issued by the Court below is hereby set aside, and in the interest of justice, the
proceedings are ordered suspended, to be held pending until the plaintiff petitioner succeeds in ascertaining the whereabouts of the
defendants and/or locating properties of the same, to enable proper summons to be issued conformably to this Opinion. No costs.
Concepcion, C.J., Makalintal, Zaldivar, Fernando, Teehankee, Barredo, Villamor and Makasiar, JJ., concur.
Dizon and Castro, JJ., reserve their votes.
[G.R. No. 156187. November 11, 2004]
JIMMY T. GO, petitioner, vs. UNITED COCONUT PLANTERS BANK, ANGELO V. MANAHAN, FRANCISCO C. ZARATE, PERLITA A. URBANO
and ATTY. EDWARD MARTIN, respondents.
DECISION
CHICO-NAZARIO, J.:
Before Us is a Petition for Review on Certiorari[1] assailing the Decision[2] dated 31 July 2002 of the Court of Appeals in CA-G.R. SP
No. 62625, the decretal portion of which reads:
WHEREFORE, the petition is GRANTED and the assailed orders dated June 7, 2000, August 9, 2000 and November 8, 2000 are SET ASIDE.
Respondent judge is directed to DISMISS Civil Case No. 67878 on the ground of improper venue.[3]
Petitioner Jimmy T. Go and Alberto T. Looyuko are co-owners of Noahs Ark International, Noahs Ark Sugar Carriers, Noahs Ark
Sugar Truckers, Noahs Ark Sugar Repacker, Noahs Ark Sugar Insurers, Noahs Ark Sugar Terminal, Noahs Ark Sugar Building, and Noahs Ark
Sugar Refinery.[4]
Sometime in August 1996, petitioner Jimmy T. Go and Alberto T. Looyuko applied for an Omnibus Line accommodation with
respondent United Coconut Planters Bank (UCPB) in the amount of Nine Hundred Million (P900,000,000) Pesos,[5] and was favorably acted
upon by the latter.
The transaction was secured by Real Estate Mortgages over parcels of land, covered by Transfer Certificate of Title (TCT) No. 64070,
located at Mandaluyong City with an area of 24,837 square meters, and registered in the name of Mr. Looyuko; and TCT No. 3325, also
located at Mandaluyong City with an area of 14,271 square meters, registered in the name of Noahs Ark Sugar Refinery.
On 21 July 1997, the approved Omnibus Line accommodation granted to petitioner was subsequently cancelled[6] by respondent
UCPB. As a consequence, petitioner Jimmy T. Go demanded from UCPB the return of the two (2) TCTs (No. 64070 and No. 3325) covered
by Real Estate Mortgages earlier executed. UCPB refused to return the same and proceeded to have the two (2) pre-signed Real Estate
Mortgages notarized on 22 July 1997 and caused the registration thereof before the Registry of Deeds of Mandaluyong City on 02
September 1997.
On 15 June 1999, respondent UCPB filed with the Office of the Clerk of Court and Ex-Officio Sheriff of Mandaluyong City an
extrajudicial foreclosure of real estate mortgage[7] covered by TCT No. 64070, for nonpayment of the obligation secured by said mortgage.
As a result, the public auction sale of the mortgaged property was set on 11 April 2000 and 03 May 2000.
To protect his interest, petitioner Jimmy T. Go filed a complaint for Cancellation of Real Estate Mortgage and damages, with prayer
for temporary restraining order and/or writ of preliminary injunction, against respondent bank and its officers, namely, Angelo V.
Manahan, Francisco C. Zarate, Perlita A. Urbano and Atty. Edward E. Martin, together with Ex-Officio Sheriff Lydia G. San Juan and Sheriff
IV Helder A. Dyangco, with the Regional Trial Court of Pasig City, Branch 266, docketed as Civil Case No. 67878. The complaint was
subsequently amended[8] on 22 May 2000. The amended complaint alleged, among other things, the following: that petitioner Jimmy T.
Go is a co-owner of the property covered by TCT No. 64070, although the title is registered only in the name of Looyuko; that respondent
bank was aware that he is a co-owner as he was asked to sign two deeds of real estate mortgage covering the subject property; that the
approved omnibus credit line applied for by him and Looyuko did not materialize and was cancelled by respondent bank on 21 July 1997,
so that the pre-signed real estate mortgages were likewise cancelled; that he demanded from respondent bank that TCTs No. 64070 and
No. 3325 be returned to him, but respondent bank refused to do so; that despite the cancellation of the omnibus credit line on 21 July
1997, respondent bank had the two deeds of real estate mortgage dated and notarized on 22 July 1997 and caused the extrajudicial
foreclosure of mortgage constituted on TCT No. 64070; that the auction sale scheduled on 11 April 2000 and 03 May 2000 be enjoined;
that the two real estate mortgages be cancelled and TCTs No. 64070 and No. 3325 be returned to him; and that respondent bank and its
officers be ordered to pay him moral and exemplary damages and attorneys fees.
On 07 June 2000, respondent bank, instead of filing an answer, filed a motion to dismiss[9] based on the following grounds: 1) that
the court has no jurisdiction over the case due to nonpayment of the proper filing and docket fees; 2) that the complaint was filed in the
wrong venue; 3) an indispensable party/real party in interest was not impleaded and, therefore, the complaint states no cause of action;
4) that the complaint was improperly verified; and 5) that petitioner is guilty of forum shopping and submitted an insufficient and false
certification of non-forum shopping.
On 07 June 2000, the trial court issued an order[10] granting petitioners application for a writ of preliminary injunction.
Correspondingly, the auction sale, scheduled on 11 April 2000 and 03 May 2000, was enjoined.
On 09 August 2000, the trial court denied[11] respondent banks motion to dismiss Civil Case No. 67878. A motion for
reconsideration[12] was filed, but the same was likewise denied in an Order[13] dated 08 November 2000.
Respondent bank questioned said orders before the Court of Appeals via a petition for certiorari[14] dated 03 January 2001, alleging
that the trial court acted without or in excess of jurisdiction or with grave abuse of discretion in issuing an order denying the motion to
dismiss and the motion for reconsideration thereof.
On 31 July 2002, the Court of Appeals[15] set aside the Orders dated 07 June 2000, 09 August 2000 and 08 November 2000 issued by
the trial court and directed the trial court to dismiss Civil Case No. 67878 on the ground of improper venue.
A motion for reconsideration was filed by petitioner,[16] which was denied in an order dated 14 November 2002.[17]
Hence, this petition for review on certiorari.[18]
On 16 June 2003, the Court gave due course to the petition, and required[19] the parties to file their respective memoranda.
Respondents filed their Joint Memorandum on 27 August 2003, while petitioner filed his on 25 September 2003 upon prior leave of court
for extension. With leave of this Court, private respondents filed their reply to petitioners memorandum.
In his memorandum, petitioner raised a lone issue:
WHETHER OR NOT THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR WHEN IT FAILED TO APPLY THE LAW
AND ESTABLISHED JURISPRUDENCE ON THE MATTER BY ISSUING THE QUESTIONED RESOLUTIONS FINDING THAT THE CASE A
QUO IS A REAL ACTION.
Simply put, the issue to be resolved in this case is whether petitioners complaint for cancellation of real estate mortgage is a
personal or real action for the purpose of determining venue.
In a real action, the plaintiff seeks the recovery of real property, or as provided for in Section 1, Rule 4, [20] a real action is an action
affecting title to or possession of real property, or interest therein. These include partition or condemnation of, or foreclosure of
mortgage on, real property. The venue for real actions is the same for regional trial courts and municipal trial courts -- the court which has
territorial jurisdiction over the area where the real property or any part thereof lies.[21]
Personal action is one brought for the recovery of personal property, for the enforcement of some contract or recovery of damages
for its breach, or for the recovery of damages for the commission of an injury to the person or property. [22] The venue for personal actions
is likewise the same for the regional and municipal trial courts -- the court of the place where the plaintiff or any of the principal plaintiffs
resides, or where the defendant or any of the principal defendants resides, at the election of the plaintiff, as indicated in Section 2 of Rule
4.[23]
It is quite clear then that the controlling factor in determining venue for cases of the above nature is the primary objective for
which said cases are filed. Thus:
1. In Commodities Storage & Ice Plant Corp. v. Court of Appeals,[24] this Court ruled that an action to redeem by the
mortgage debtor affects his title to the foreclosed property. If the action is seasonably made, it seeks to erase from the
title of the judgment or mortgage debtor the lien created by registration of the mortgage and sale. If not made
seasonably, it may seek to recover ownership to the land since the purchasers inchoate title to the property becomes
 consolidated after [the] expiration of the redemption period. Either way, redemption involves the title to the foreclosed
property. It is a real action.
2. In Fortune Motors, (Phils.), Inc., v. Court of Appeals,[25] this Court quoting the decision of the Court of Appeals ruled that
since an extrajudicial foreclosure of real property results in a conveyance of the title of the property sold to the highest
bidder at the sale, an action to annul the foreclosure sale is necessarily an action affecting the title of the property sold.
It is therefore a real action which should be commenced and tried in the province where the property or part thereof
lies.
3. In Punsalan, Jr. v. Vda. de Lacsamana,[26] this court ruled that while it is true that petitioner does not directly seek the
recovery . . . of the property in question, his action for annulment of sale and his claim for damages are closely
intertwined with the issue of ownership of the building which, under the law, is considered immovable property, the
recovery of which is petitioners primary objective. The prevalent doctrine is that an action for the annulment or
rescission of a sale of real property does not operate to efface the fundamental and prime objective and nature of the
case, which is to recover said real property. It is a real action. Respondent Court, therefore, did not err in dismissing the
case on the ground of improper venue which was timely raised.
4. In Ruiz v. J. M. Tuason Co., Inc., et al.,[27] the court ruled that although [a] complaint is entitled to be one for specific
performance, yet the fact that [complainant] asked that a deed of sale of a parcel of land . . . be issued in his favor and
that a transfer certificate of title covering said land be issued to him, shows that the primary objective and nature of the
action is to recover the parcel of land itself because to execute in favor of complainant the conveyance requested there
is need to make a finding that he is the owner of the land which in the last analysis resolves itself into an issue of
ownership. Hence, the action must be commenced in the province where the property is situated . . . ."
5. In Dr. Antonio A. Lizares, Inc. v. Hon. Hermogenes Caluag,[28] this Court ruled that an action praying that defendant be
ordered `to accept the payment being made by plaintiff for the lot which the latter contracted to buy on installment
basis from the former, to pay plaintiff compensatory damages and attorneys fees and to enjoin defendant and his
agents from repossessing the lot in question, is one that affects title to the land under Section 3 of Rule 5, of the Rules of
Court, and shall be commenced and tried in the province where the property or any part thereof lies, because, although
the immediate remedy is to compel the defendant to accept the tender of payment allegedly made, it is obvious that
this relief is merely the first step to establish plaintiffs title to [the] real property.
6. In Land Tenure Administration, et al. v. The Honorable Higinio B. Macadaeg and Alejandro T. Lim, [29] this Court ruled that
where the lessee seeks to establish an interest in an hacienda that runs with the land and one that must be respected by
the purchaser of the land even if the latter is not a party to the original lease contract, the question of whether or not
the standing crop is immovable property become[s] irrelevant, for venue is determined by the nature of the principal
claim. Since the lessee is primarily interested in establishing his right to recover possession of the land for the purpose of
enabling him to gather his share of the crops, his action is real and must be brought in the locality where the land is
situated.
7. In Espineli & Mojica v. Hon. Santiago and Vda. de Ramirez,[30] the court ruled that although the main relief sought in the
case at bar was the delivery of the certificate of title, said relief, in turn, entirely depended upon who, between the
parties, has a better right to the lot in question. As it is not possible for the court to decide the main relief, without
passing upon the claim of the parties with respect to the title to and possession of the lot in question, the claim shall be
determined x x x in the province where [the] said property or any part thereof lies.
The case of Carandang v. Court of Appeals,[31] is more particularly instructive. There, we held that an action for nullification of the
mortgage documents and foreclosure of the mortgaged property is a real action that affects the title to the property. Thus, venue of the
real action is before the court having jurisdiction over the territory in which the property lies, which is the Court of First Instance of
Laguna.
Petitioner in this case contends that a case for cancellation of mortgage is a personal action and since he resides at Pasig City,
venue was properly laid therein. He tries to make a point by alluding to the case of Francisco S. Hernandez v. Rural Bank of Lucena.[32]
Petitioners reliance in the case of Francisco S. Hernandez v. Rural Bank of Lucena[33] is misplaced. Firstly, said case was primarily an
action to compel the mortgagee bank to accept payment of the mortgage debt and to release the mortgage. That action, which is not
expressly included in the enumeration found in Section 2(a) of Rule 4 of the Old Civil Procedure and now under Section 1, Rule 4 of the
1997 Rules of Civil Procedure, does not involve titles to the mortgaged lots. It is a personal action and not a real action. The mortgagee
has not foreclosed the mortgage. The plaintiffs title is not in question. They are in possession of the mortgaged lots. Hence, the venue of
the plaintiffs personal action is the place where the defendant or any of the defendants resides or may be found, or where the plaintiff or
any of the plaintiffs resides, at the election of the plaintiff. In the case at bar, the action for cancellation of real estate mortgage filed by
herein petitioner was primarily an action to compel private respondent bank to return to him the properties covered by TCTs No. 64070
and No. 3325 over which the bank had already initiated foreclosure proceedings because of the cancellation by the said respondent bank
of the omnibus credit line on 21 July 1997. The prime objective is to recover said real properties. Secondly, Carandang distinctly
articulated that the ruling in Hernandez does not apply where the mortgaged property had already been foreclosed. Here, and as correctly
pointed out by the appellate court, respondent bank had already initiated extrajudicial foreclosure proceedings, and were it not for the
timely issuance of a restraining order secured by petitioner Go in the lower court, the same would have already been sold at a public
auction.
In a relatively recent case, Asset Privatization Trust v. Court of Appeals,[34] it was succinctly stated that the prayer for the
nullification of the mortgage is a prayer affecting real property, hence, is a real action.
In sum, the cancellation of the real estate mortgage, subject of the instant petition, is a real action, considering that a real estate
mortgage is a real right and a real property by itself.[35]An action for cancellation of real estate mortgage is necessarily an action affecting
the title to the property. It is, therefore, a real action which should be commenced and tried in Mandaluyong City, the place where the
subject property lies.
WHEREFORE, the instant petition is DENIED for lack of merit. The assailed decision dated 31 July 2002 and the Order dated 14
November 2002 denying the motion for reconsideration are hereby AFFIRMED. With costs.
SO ORDERED.
Austria-Martinez, (Acting Chairman), and Callejo, JJ., concur.
Puno, (Chairman), J., on official leave.
Tinga, J., on leave.
[G.R. No. 146089. December 13, 2001]
VIRGINIA GOCHAN, LOUISE GOCHAN, LAPU-LAPU REAL ESTATE CORPORATION, FELIX GOCHAN AND SONS REALTY CORPORATION,
MACTAN REALTY DEVELOPMENT CORPORATION, petitioners, vs. MERCEDES GOCHAN, ALFREDO GOCHAN, ANGELINA
GOCHAN-HERNAEZ, MA. MERCED GOCHAN GOROSPE, CRISPO GOCHAN, JR., and MARLON GOCHAN, respondents.
DECISION
YNARES-SANTIAGO, J.:
This is a petition for review seeking to set aside the decision of the Court of Appeals dated September 10, 1999 in CA-G.R. SP No.
49084,[1] as well as its Resolution[2] dated November 22, 2000, denying the Motion for Reconsideration.
Respondents were stockholders of the Felix Gochan and Sons Realty Corporation and the Mactan Realty Development
Corporation. Sometime in 1996, respondents offered to sell their shares in the two corporations to the individual petitioners, the heirs of
the late Ambassador Esteban Gochan, for and in consideration of the sum of P200,000,000.00. Petitioners accepted and paid the said
amount to respondents. Accordingly, respondents issued to petitioners the necessary Receipts.[3] In addition, respondents executed their
respective Release, Waiver and Quitclaim,[4] wherein they undertook that they would not initiate any suit, action or complaint against
petitioners for whatever reason or purpose.
In turn, respondents, through Crispo Gochan, Jr., required individual petitioners to execute a promissory note,[5] undertaking not to
divulge the actual consideration they paid for the shares of stock. For this purpose, Crispo Gochan, Jr. drafted a document entitled
promissory note in his own handwriting and had the same signed by Felix Gochan, III, Louise Gochan and Esteban Gochan, Jr.
Unbeknown to petitioners, Crispo Gochan, Jr. inserted in the promissory note a phrase that says, Said amount is in partial
consideration of the sale.[6]
On April 3, 1998, respondents filed a complaint against petitioners for specific performance and damages with the Regional Trial
Court of Cebu City, Branch 11, docketed as Civil Case No. CEB-21854.Respondents alleged that sometime in November 1996, petitioner
Louise Gochan, on behalf of all the petitioners, offered to buy their shares of stock, consisting of 254 shares in the Felix Gochan and Sons
Realty Corporation and 1,624 shares of stock in the Mactan Realty Development Corporation; and that they executed a Provisional
Memorandum of Agreement, wherein they enumerated the following as consideration for the sale:
1. Pesos: Two Hundred Million Pesos (P200M)
2. Two (2) hectares more or less of the fishpond in Gochan compound, Mabolo, Lot 4F-2-B
3. Lot 2, Block 9 with an area of 999 square meters in Gochan Compound, Mabolo, Cebu
4. Three Thousand (3,000) square meters of Villas Magallanes in Mactan, Cebu
5. Lot 423 New Gem Building with an area of 605 square meters.[7]
Accordingly, respondents claimed that they are entitled to the conveyance of the aforementioned properties, in addition to the
amount of P200,000,000.00, which they acknowledge to have received from petitioners. Further, respondents prayed for moral damages
of P15,000,000.00, exemplary damages of P2,000,000.00, attorneys fees of P14,000,000.00, and litigation expenses of P2,000,000.00.
Petitioners filed their answer, raising the following affirmative defenses: (a) lack of jurisdiction by the trial court for non-payment of
the correct docket fees; (b) unenforceability of the obligation to convey real properties due to lack of a written memorandum thereof,
pursuant to the Statute of Frauds; (c) extinguishment of the obligation by payment; (d) waiver, abandonment and renunciation by
respondent of all their claims against petitioners; and (e) non-joinder of indispensable parties.
On August 7, 1998, petitioners filed with the trial court a motion for a preliminary hearing on the affirmative defenses. In an Order
dated August 11, 1998, the trial court denied the motion, ruling as follows:
As the grant of said motion lies in the discretion of the court under Section 6 of Rule 16 of the 1997 Rules of Civil Procedure, this Court in
the exercise of its discretion, hereby denies the said motion because the matters sought to be preliminarily heard do not appear to be
tenable. For one, the statute of frauds does not apply in this case because the contract which is the subject matter of this case is already
an executed contract. The statute of frauds applies only to executory contracts. According to Dr. Arturo M. Tolentino, a leading authority
in civil law, since the statute of frauds was enacted for the purpose of preventing frauds, it should not be made the instrument to further
them. Thus, where one party has performed his obligation under a contract, equity would agree that all evidence should be admitted to
prove the alleged agreement (PNB vs. Philippine Vegetable Oil Company, 49 Phil. 897). For another, the contention of the defendants that
the claims of the plaintiffs are already extinguished by full payment thereof does not appear to be indubitable because the plaintiffs
denied under oath the due execution and genuineness of the receipts which are attached as Annexes 1-A, 1-B and 1-C of defendants
answer. This issue therefore has to be determined on the basis of preponderance of evidence to be adduced by both parties. Then, still for
another, the contention that the complaint is defective because it allegedly has failed to implead indispensable parties appears to be
wanting in merit because the parties to the memorandum of agreement adverted to in the complaint are all parties in this case. Then the
matter of payment of docketing and filing fees is not a fatal issue in this case because the record shows that the plaintiffs had paid at least
P165,000.00 plus in the form of filing and docketing fees. Finally, regarding exerting earnest efforts toward a compromise by the plaintiffs,
the defendants cannot say that there is an absence of an allegation to this effect in the complaint because paragraph 11 of the complaint
precisely states that before filing this case, earnest efforts toward a compromise have been made.
Petitioners motion for reconsideration of the above Order was denied by the trial court on September 11, 1998.
Petitioners thus filed a petition for certiorari with the Court of Appeals, docketed as CA-G.R. SP No. 49084. On September 10, 1999,
the Court of Appeals rendered the appealed decision dismissing the petition on the ground that respondent court did not commit grave
abuse of discretion, tantamount to lack or in excess of jurisdiction in denying the motion to hear the affirmative defenses.[8]
Again, petitioners filed a motion for reconsideration, but the same was denied by the Court of Appeals in its assailed Resolution of
November 22, 2000.[9]
Petitioners, thus, brought the present petition for review anchored on the following grounds:
I.
THE COURT OF APPEALS COMMITTED GRAVE AND PALPABLE ERROR IN FINDING THAT THE CORRECT DOCKET FEES HAVE BEEN PAID.
II.
THE COURT OF APPEALS COMMITTED SERIOUS ERROR IN RULING THAT THE PMOA WAS A PARTIALLY EXECUTED CONTRACT AND HENCE
NOT COVERED BY THE STATUTE OF FRAUDS.
III.
THE COURT OF APPEALS COMMITTED GRAVE ERROR IN DECIDING THAT THE CLAIMS OF PRIVATE RESPONDENTS HAVE NOT BEEN
EXTINGUISHED BY PAYMENT OR FULL SETTLEMENT DESPITE THE PRESENCE OF RECEIPTS SIGNED BY THE PRIVATE RESPONDENTS
SHOWING THE CONTRARY.
IV.
THE COURT OF APPEALS COMMITTED GRAVE ERROR IN RESOLVING THAT FELIX GOCHAN III AND ESTEBAN GOCHAN, JR. ARE NOT
INDISPENSABLE PARTIES AND THEREFORE NEED NOT BE IMPLEADED AS PARTIES.[10]
Respondents filed their Comment,[11] arguing, in fine, that petitioners are guilty of forum-shopping when they filed two petitions for
certiorari with the Court of Appeals; and that the Court of Appeals did not err in dismissing the petition for certiorari.
The instant petition has merit.
The rule is well-settled that the court acquires jurisdiction over any case only upon the payment of the prescribed docket fees. In
the case of Sun Insurance Office, Ltd. (SIOL) v. Asuncion,[12] this Court held that it is not simply the filing of the complaint or appropriate
initiatory pleading, but the payment of the prescribed docket fee that vests a trial court with jurisdiction over the subject matter or nature
of the action.
Respondents maintain that they paid the correct docket fees in the amount of P165,000.00 when they filed the complaint with the
trial court. Petitioners, on the other hand, contend that the complaint is in the nature of a real action which affects title to real properties;
hence, respondents should have alleged therein the value of the real properties which shall be the basis for the assessment of the correct
docket fees.
The Court of Appeals found that the complaint was one for specific performance and incapable of pecuniary estimation. We do not
agree.
It is necessary to determine the true nature of the complaint in order to resolve the issue of whether or not respondents paid the
correct amount of docket fees therefor. In this jurisdiction, the dictum adhered to is that the nature of an action is determined by the
allegations in the body of the pleading or complaint itself, rather than by its title or heading. [13] The caption of the complaint below was
denominated as one for specific performance and damages. The relief sought, however, is the conveyance or transfer of real property, or
ultimately, the execution of deeds of conveyance in their favor of the real properties enumerated in the provisional memorandum of
agreement. Under these circumstances, the case below was actually a real action, affecting as it does title to or possession of real
property.
In the case of Hernandez v. Rural Bank of Lucena,[14] this Court held that a real action is one where the plaintiff seeks the recovery
of real property or, as indicated in section 2(a) of Rule 4 (now Section 1, Rule 4 of the 1997 Rules of Civil Procedure), a real action is an
action affecting title to or recovery of possession of real property.
It has also been held that where a complaint is entitled as one for specific performance but nonetheless prays for the issuance of a
deed of sale for a parcel of land, its primary objective and nature is one to recover the parcel of land itself and, thus, is deemed a real
action. In such a case, the action must be filed in the proper court where the property is located:
In this Court, the appellant insists that her action is one for specific performance, and, therefore, personal and transitory in nature.
This very issue was considered and decided by this Court in the case of Manuel B. Ruiz vs. J.M. Tuason & Co., Inc. et al., L-18692,
promulgated 31 January 1963. There the Court, by unanimous vote of all the Justices, held as follows:
This contention has no merit. Although appellants complaint is entitled to be one for specific performance, yet the fact that he asked that
a deed of sale of a parcel of land situated in Quezon City be issued in his favor and that a transfer certificate of title covering said parcel of
land be issued to him shows that the primary objective and nature of the action is to recover the parcel of land itself because to execute
in favor of appellant the conveyance requested there is need to make a finding that he is the owner of the land which in the last analysis
resolves itself into an issue of ownership. Hence, the action must be commenced in the province where the property is situated pursuant
to Section 3, Rule 5, of the Rules of Court, which provides that actions affecting title to or recovery of possession of real property shall be
commenced and tried in the province where the property or any part thereof lies.[15]
In the case at bar, therefore, the complaint filed with the trial court was in the nature of a real action, although ostensibly
denominated as one for specific performance. Consequently, the basis for determining the correct docket fees shall be the assessed value
of the property, or the estimated value thereof as alleged by the claimant. Rule 141, Section 7, of the Rules of Court, as amended by A.M.
No. 00-2-01-SC, provides:
Section 7. Clerks of Regional Trial Courts. - x x x
(b) xxx
In a real action, the assessed value of the property, or if there is none, the estimated value thereof shall be alleged by the claimant and
shall be the basis in computing the fees.
We are not unmindful of our pronouncement in the case of Sun Insurance,[16] to the effect that in case the filing of the initiatory
pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no
case beyond the applicable prescriptive period. However, the liberal interpretation of the rules relating to the payment of docket fees as
applied in the case of Sun Insurance cannot apply to the instant case as respondents have never demonstrated any willingness to abide by
the rules and to pay the correct docket fees. Instead, respondents have stubbornly insisted that the case they filed was one for specific
performance and damages and that they actually paid the correct docket fees therefor at the time of the filing of the complaint. Thus, it
was stated in the case of Sun Insurance:[17]
The principle in Manchester could very well be applied in the present case. The pattern and the intent to defraud the government of the
docket fee due it is obvious not only in the filing of the original complaint but also in the filing of the second amended complaint.
However, in Manchester, petitioner did not pay any additional docket fee until the case was decided by this Court on May 7, 1987. Thus,
in Manchester, due to the fraud committed on the government, this Court held that the court a quo did not acquire jurisdiction over the
case and that the amended complaint could not have been admitted inasmuch as the original complaint was null and void.
In the present case, a more liberal interpretation of the rules is called for considering that, unlike Manchester, private respondent
demonstrated his willingness to abide by the rules by paying the additional docket fees as required. The promulgation of the decision
in Manchester must have had that sobering influence on private respondent who thus paid the additional docket fee as ordered by the
respondent court. It triggered his change of stance by manifesting his willingness to pay such additional docket fee as may be ordered.
Respondents accuse petitioners of forum-shopping when they filed two petitions before the Court of Appeals. Petitioners, on the
other hand, contend that there was no forum-shopping as there was no identity of issues or identity of reliefs sought in the two petitions.
We agree with petitioners that they are not guilty of forum-shopping. The deplorable practice of forum-shopping is resorted to by
litigants who, for the purpose of obtaining the same relief, resort to two different fora to increase his or her chances of obtaining a
favorable judgment in either one. In the case of Golangco v. Court of Appeals,[18] we laid down the following test to determine whether
there is forum-shopping:
Ultimately, what is truly important to consider in determining whether forum-shopping exists or not is the vexation caused the courts and
the parties-litigant by a person who asks different courts and/or administrative agencies to rule on the same or related causes and/or
grant the same or substantially the same reliefs, in the process creating the possibility of conflicting decisions being rendered by the
different fora upon the same issues.
In sum, two different orders were questioned, two distinct causes of action and issues were raised, and two objectives were sought; thus,
forum shopping cannot be said to exist in the case at bar.
Likewise, we do not find that there is forum-shopping in the case at bar. The first petition, docketed as CA-G.R. SP. No. 49084,
which is now the subject of the instant petition, involved the propriety of the affirmative defenses relied upon by petitioners in Civil Case
No. CEB-21854. The second petition, docketed as CA-G.R. SP No. 54985, raised the issue of whether or not public respondent Judge
Dicdican was guilty of manifest partiality warranting his inhibition from further hearing Civil Case No. CEB-21854.
More importantly, the two petitions did not seek the same relief from the Court of Appeals. In CA-G.R. SP. No. 49084, petitioners
prayed, among others, for the annulment of the orders of the trial court denying their motion for preliminary hearing on the affirmative
defenses in Civil Case No. CEB-21854. No such reliefs are involved in the second petition, where petitioners merely prayed for the issuance
of an order enjoining public respondent Judge Dicdican from further trying the case and to assign a new judge in his stead.
True, the trial court has the discretion to conduct a preliminary hearing on affirmative defenses. In the case at bar, however, the
trial court committed a grave abuse of its discretion when it denied the motion for preliminary hearing. As we have discussed above,
some of these defenses, which petitioners invoked as grounds for the dismissal of the action, appeared to be indubitable, contrary to the
pronouncement of the trial court. Indeed, the abuse of discretion it committed amounted to an evasion of positive duty or virtual refusal
to perform a duty enjoined by law, or to act at all in contemplation of law,[19] which would have warranted the extraordinary writ of
certiorari. Hence, the Court of Appeals erred when it dismissed the petition for certiorari filed by petitioners.
WHEREFORE, in view of the foregoing, the instant petition is GRANTED. This case is REMANDED to the Regional Trial Court of Cebu
City, Branch 11, which is directed to forthwith conduct the preliminary hearing on the affirmative defenses in Civil Case No. CEB-21854.
SO ORDERED.
Kapunan, and Pardo, JJ., concur.
Davide, Jr., C.J., (Chairman), see dissenting opinion.
Puno, J., joins the dissent of C.J., Davide, Jr.
G.R. No. 75919 May 7, 1987
MANCHESTER DEVELOPMENT CORPORATION, ET AL., petitioners,
vs.
COURT OF APPEALS, CITY LAND DEVELOPMENT CORPORATION, STEPHEN ROXAS, ANDREW LUISON, GRACE LUISON and JOSE DE
MAISIP, respondents.
Tanjuatco, Oreta and Tanjuatco for petitioners.
Pecabar Law Offices for private respondents.
RESOLUTION
GANCAYCO, J.:
Acting on the motion for reconsideration of the resolution of the Second Division of January 28,1987 and another motion to refer the case
to and to be heard in oral argument by the Court En Banc filed by petitioners, the motion to refer the case to the Court en banc is granted
but the motion to set the case for oral argument is denied.
Petitioners in support of their contention that the filing fee must be assessed on the basis of the amended complaint cite the case
of Magaspi vs. Ramolete. 1 They contend that the Court of Appeals erred in that the filing fee should be levied by considering the amount
of damages sought in the original complaint.
The environmental facts of said case differ from the present in that —
1. The Magaspi case was an action for recovery of ownership and possession of a parcel of land with damages.2While the present case is
an action for torts and damages and specific performance with prayer for temporary restraining order, etc.3
2. In the Magaspi case, the prayer in the complaint seeks not only the annulment of title of the defendant to the property, the declaration
of ownership and delivery of possession thereof to plaintiffs but also asks for the payment of actual moral, exemplary damages and
attorney's fees arising therefrom in the amounts specified therein. 4However, in the present case, the prayer is for the issuance of a writ
of preliminary prohibitory injunction during the pendency of the action against the defendants' announced forfeiture of the sum of P3
Million paid by the plaintiffs for the property in question, to attach such property of defendants that maybe sufficient to satisfy any
judgment that maybe rendered, and after hearing, to order defendants to execute a contract of purchase and sale of the subject property
and annul defendants' illegal forfeiture of the money of plaintiff, ordering defendants jointly and severally to pay plaintiff actual,
compensatory and exemplary damages as well as 25% of said amounts as maybe proved during the trial as attorney's fees and declaring
the tender of payment of the purchase price of plaintiff valid and producing the effect of payment and to make the injunction permanent.
The amount of damages sought is not specified in the prayer although the body of the complaint alleges the total amount of over P78
Million as damages suffered by plaintiff.5
3. Upon the filing of the complaint there was an honest difference of opinion as to the nature of the action in the Magaspi case. The
complaint was considered as primarily an action for recovery of ownership and possession of a parcel of land. The damages stated were
treated as merely to the main cause of action. Thus, the docket fee of only P60.00 and P10.00 for the sheriff's fee were paid. 6
In the present case there can be no such honest difference of opinion. As maybe gleaned from the allegations of the complaint as well as
the designation thereof, it is both an action for damages and specific performance. The docket fee paid upon filing of complaint in the
amount only of P410.00 by considering the action to be merely one for specific performance where the amount involved is not capable of
pecuniary estimation is obviously erroneous. Although the total amount of damages sought is not stated in the prayer of the complaint
yet it is spelled out in the body of the complaint totalling in the amount of P78,750,000.00 which should be the basis of assessment of the
filing fee.
4. When this under-re assessment of the filing fee in this case was brought to the attention of this Court together with similar other cases
an investigation was immediately ordered by the Court. Meanwhile plaintiff through another counsel with leave of court filed an amended
complaint on September 12, 1985 for the inclusion of Philips Wire and Cable Corporation as co-plaintiff and by emanating any mention of
the amount of damages in the body of the complaint. The prayer in the original complaint was maintained. After this Court issued an
order on October 15, 1985 ordering the re- assessment of the docket fee in the present case and other cases that were investigated, on
November 12, 1985 the trial court directed plaintiffs to rectify the amended complaint by stating the amounts which they are asking for. It
was only then that plaintiffs specified the amount of damages in the body of the complaint in the reduced amount of
P10,000,000.00. 7 Still no amount of damages were specified in the prayer. Said amended complaint was admitted.
On the other hand, in the Magaspi case, the trial court ordered the plaintiffs to pay the amount of P3,104.00 as filing fee covering the
damages alleged in the original complaint as it did not consider the damages to be merely an or incidental to the action for recovery of
ownership and possession of real property. 8 An amended complaint was filed by plaintiff with leave of court to include the government of
the Republic as defendant and reducing the amount of damages, and attorney's fees prayed for to P100,000.00. Said amended complaint
was also admitted. 9
In the Magaspi case, the action was considered not only one for recovery of ownership but also for damages, so that the filing fee for the
damages should be the basis of assessment. Although the payment of the docketing fee of P60.00 was found to be insufficient,
nevertheless, it was held that since the payment was the result of an "honest difference of opinion as to the correct amount to be paid as
docket fee" the court "had acquired jurisdiction over the case and the proceedings thereafter had were proper and regular." 10 Hence, as
the amended complaint superseded the original complaint, the allegations of damages in the amended complaint should be the basis of
the computation of the filing fee. 11
In the present case no such honest difference of opinion was possible as the allegations of the complaint, the designation and the prayer
show clearly that it is an action for damages and specific performance. The docketing fee should be assessed by considering the amount of
damages as alleged in the original complaint.
As reiterated in the Magaspi case the rule is well-settled "that a case is deemed filed only upon payment of the docket fee regardless of
the actual date of filing in court . 12 Thus, in the present case the trial court did not acquire jurisdiction over the case by the payment of
only P410.00 as docket fee. Neither can the amendment of the complaint thereby vest jurisdiction upon the Court. 13 For an legal
purposes there is no such original complaint that was duly filed which could be amended. Consequently, the order admitting the amended
complaint and all subsequent proceedings and actions taken by the trial court are null and void.
The Court of Appeals therefore, aptly ruled in the present case that the basis of assessment of the docket fee should be the amount of
damages sought in the original complaint and not in the amended complaint.
The Court cannot close this case without making the observation that it frowns at the practice of counsel who filed the original complaint
in this case of omitting any specification of the amount of damages in the prayer although the amount of over P78 million is alleged in the
body of the complaint. This is clearly intended for no other purpose than to evade the payment of the correct filing fees if not to mislead
the docket clerk in the assessment of the filing fee. This fraudulent practice was compounded when, even as this Court had taken
cognizance of the anomaly and ordered an investigation, petitioner through another counsel filed an amended complaint, deleting all
mention of the amount of damages being asked for in the body of the complaint. It was only when in obedience to the order of this Court
of October 18, 1985, the trial court directed that the amount of damages be specified in the amended complaint, that petitioners' counsel
wrote the damages sought in the much reduced amount of P10,000,000.00 in the body of the complaint but not in the prayer thereof. The
design to avoid payment of the required docket fee is obvious.
The Court serves warning that it will take drastic action upon a repetition of this unethical practice.
To put a stop to this irregularity, henceforth all complaints, petitions, answers and other similar pleadings should specify the amount of
damages being prayed for not only in the body of the pleading but also in the prayer, and said damages shall be considered in the
assessment of the filing fees in any case. Any pleading that fails to comply with this requirement shall not bib accepted nor admitted, or
shall otherwise be expunged from the record.
The Court acquires jurisdiction over any case only upon the payment of the prescribed docket fee. An amendment of the complaint or
similar pleading will not thereby vest jurisdiction in the Court, much less the payment of the docket fee based on the amounts sought in
the amended pleading. The ruling in the Magaspi case 14 in so far as it is inconsistent with this pronouncement is overturned and
reversed.
WHEREFORE, the motion for reconsideration is denied for lack of merit.
SO ORDERED.
Teehankee, C.J., Yap, Fernan, Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano, Bidin, Sarmiento and Cortes, JJ., concur.
Paras, J., took no part.
.R. Nos. 79937-38 February 13, 1989
SUN INSURANCE OFFICE, LTD., (SIOL), E.B. PHILIPPS and D.J. WARBY, petitioners,
vs.
HON. MAXIMIANO C. ASUNCION, Presiding Judge, Branch 104, Regional Trial Court, Quezon City and MANUEL CHUA UY PO
TIONG, respondents.
Romulo, Mabanta, Buenaventura, Sayoc & De los Angeles Law Offices for petitioners. Tanjuatco, Oreta, Tanjuatco, Berenguer & Sanvicente
Law Offices for private respondent.
GANCAYCO, J.:
Again the Court is asked to resolve the issue of whether or not a court acquires jurisdiction over a case when the correct and proper
docket fee has not been paid.
On February 28, 1984, petitioner Sun Insurance Office, Ltd. (SIOL for brevity) filed a complaint with the Regional Trial Court of Makati,
Metro Manila for the consignation of a premium refund on a fire insurance policy with a prayer for the judicial declaration of its nullity
against private respondent Manuel Uy Po Tiong. Private respondent as declared in default for failure to file the required answer within the
reglementary period.
On the other hand, on March 28, 1984, private respondent filed a complaint in the Regional Trial Court of Quezon City for the refund of
premiums and the issuance of a writ of preliminary attachment which was docketed as Civil Case No. Q-41177, initially against petitioner
SIOL, and thereafter including E.B. Philipps and D.J. Warby as additional defendants. The complaint sought, among others, the payment of
actual, compensatory, moral, exemplary and liquidated damages, attorney's fees, expenses of litigation and costs of the suit. Although the
prayer in the complaint did not quantify the amount of damages sought said amount may be inferred from the body of the complaint to
be about Fifty Million Pesos (P50,000,000.00).
Only the amount of P210.00 was paid by private respondent as docket fee which prompted petitioners' counsel to raise his objection. Said
objection was disregarded by respondent Judge Jose P. Castro who was then presiding over said case. Upon the order of this Court, the
records of said case together with twenty-two other cases assigned to different branches of the Regional Trial Court of Quezon City which
were under investigation for under-assessment of docket fees were transmitted to this Court. The Court thereafter returned the said
records to the trial court with the directive that they be re-raffled to the other judges in Quezon City, to the exclusion of Judge Castro.
Civil Case No. Q-41177 was re-raffled to Branch 104, a sala which was then vacant.
On October 15, 1985, the Court en banc issued a Resolution in Administrative Case No. 85-10-8752-RTC directing the judges in said cases
to reassess the docket fees and that in case of deficiency, to order its payment. The Resolution also requires all clerks of court to issue
certificates of re-assessment of docket fees. All litigants were likewise required to specify in their pleadings the amount sought to be
recovered in their complaints.
On December 16, 1985, Judge Antonio P. Solano, to whose sala Civil Case No. Q-41177 was temporarily assigned, issuedan order to the
Clerk of Court instructing him to issue a certificate of assessment of the docket fee paid by private respondent and, in case of deficiency,
to include the same in said certificate.
On January 7, 1984, to forestall a default, a cautionary answer was filed by petitioners. On August 30,1984, an amended complaint was
filed by private respondent including the two additional defendants aforestated.
Judge Maximiano C. Asuncion, to whom Civil Case No. Q41177 was thereafter assigned, after his assumption into office on January 16,
1986, issued a Supplemental Order requiring the parties in the case to comment on the Clerk of Court's letter-report signifying her
difficulty in complying with the Resolution of this Court of October 15, 1985 since the pleadings filed by private respondent did not
indicate the exact amount sought to be recovered. On January 23, 1986, private respondent filed a "Compliance" and a "Re-Amended
Complaint" stating therein a claim of "not less than Pl0,000,000. 00 as actual compensatory damages" in the prayer. In the body of the
said second amended complaint however, private respondent alleges actual and compensatory damages and attorney's fees in the total
amount of about P44,601,623.70.
On January 24, 1986, Judge Asuncion issued another Order admitting the second amended complaint and stating therein that the same
constituted proper compliance with the Resolution of this Court and that a copy thereof should be furnished the Clerk of Court for the
reassessment of the docket fees. The reassessment by the Clerk of Court based on private respondent's claim of "not less than
P10,000,000.00 as actual and compensatory damages" amounted to P39,786.00 as docket fee. This was subsequently paid by private
respondent.
Petitioners then filed a petition for certiorari with the Court of Appeals questioning the said order of Judie Asuncion dated January 24,
1986.
On April 24, 1986, private respondent filed a supplemental complaint alleging an additional claim of P20,000,000.00 as d.qmages so the
total claim amounts to about P64,601,623.70. On October 16, 1986, or some seven months after filing the supplemental complaint, the
private respondent paid the additional docket fee of P80,396.00.1
On August 13, 1987, the Court of Appeals rendered a decision ruling, among others, as follows:
WHEREFORE, judgment is hereby rendered:
1. Denying due course to the petition in CA-G.R. SP No. 1, 09715 insofar as it seeks annulment of the order
(a) denying petitioners' motion to dismiss the complaint, as amended, and
(b) granting the writ of preliminary attachment, but giving due course to the portion thereof questioning the
reassessment of the docketing fee, and requiring the Honorable respondent Court to reassess the docketing fee to
be paid by private respondent on the basis of the amount of P25,401,707.00. 2
Hence, the instant petition.
During the pendency of this petition and in conformity with the said judgment of respondent court, private respondent paid the
additional docket fee of P62,432.90 on April 28, 1988. 3
The main thrust of the petition is that the Court of Appeals erred in not finding that the lower court did not acquire jurisdiction over Civil
Case No. Q-41177 on the ground of nonpayment of the correct and proper docket fee. Petitioners allege that while it may be true that
private respondent had paid the amount of P182,824.90 as docket fee as herein-above related, and considering that the total amount
sought to be recovered in the amended and supplemental complaint is P64,601,623.70 the docket fee that should be paid by private
respondent is P257,810.49, more or less. Not having paid the same, petitioners contend that the complaint should be dismissed and all
incidents arising therefrom should be annulled. In support of their theory, petitioners cite the latest ruling of the Court in Manchester
Development Corporation vs. CA, 4 as follows:
The Court acquires jurisdiction over any case only upon the payment of the prescribed docket fee. An amendment
of the complaint or similar pleading will not thereby vest jurisdiction in the Court, much less the payment of the
docket fee based on the amounts sought in the amended pleading. The ruling in the Magaspi Case in so far as it is
inconsistent with this pronouncement is overturned and reversed.
On the other hand, private respondent claims that the ruling in Manchester cannot apply retroactively to Civil Case No. Q41177 for at the
time said civil case was filed in court there was no such Manchester ruling as yet. Further, private respondent avers that what is applicable
is the ruling of this Court in Magaspi v. Ramolete, 5 wherein this Court held that the trial court acquired jurisdiction over the case even if
the docket fee paid was insufficient.
The contention that Manchester cannot apply retroactively to this case is untenable. Statutes regulating the procedure of the courts will
be construed as applicable to actions pending and undetermined at the time of their passage. Procedural laws are retrospective in that
sense and to that extent. 6
In Lazaro vs. Endencia and Andres, 7 this Court held that the payment of the full amount of the docket fee is an indispensable step for the
perfection of an appeal. In a forcible entry and detainer case before the justice of the peace court of Manaoag, Pangasinan, after notice of
a judgment dismissing the case, the plaintiff filed a notice of appeal with said court but he deposited only P8.00 for the docket fee, instead
of P16.00 as required, within the reglementary period of appeal of five (5) days after receiving notice of judgment. Plaintiff deposited the
additional P8.00 to complete the amount of the docket fee only fourteen (14) days later. On the basis of these facts, this court held that
the Court of First Instance did notacquire jurisdiction to hear and determine the appeal as the appeal was not thereby perfected.
In Lee vs. Republic, 8 the petitioner filed a verified declaration of intention to become a Filipino citizen by sending it through registered
mail to the Office of the Solicitor General in 1953 but the required filing fee was paid only in 1956, barely 5V2 months prior to the filing of
the petition for citizenship. This Court ruled that the declaration was not filed in accordance with the legal requirement that such
declaration should be filed at least one year before the filing of the petition for citizenship. Citing Lazaro, this Court concluded that the
filing of petitioner's declaration of intention on October 23, 1953 produced no legal effect until the required filing fee was paid on May 23,
1956.
In Malimit vs. Degamo, 9 the same principles enunciated in Lazaro and Lee were applied. It was an original petition for quo
warranto contesting the right to office of proclaimed candidates which was mailed, addressed to the clerk of the Court of First Instance,
within the one-week period after the proclamation as provided therefor by law.10However, the required docket fees were paid only after
the expiration of said period. Consequently, this Court held that the date of such payment must be deemed to be the real date of filing of
aforesaid petition and not the date when it was mailed.
Again, in Garica vs, Vasquez, 11 this Court reiterated the rule that the docket fee must be paid before a court will act on a petition or
complaint. However, we also held that said rule is not applicable when petitioner seeks the probate of several wills of the same decedent
as he is not required to file a separate action for each will but instead he may have other wills probated in the same special proceeding
then pending before the same court.
Then in Magaspi, 12 this Court reiterated the ruling in Malimit and Lee that a case is deemed filed only upon payment of the docket fee
regardless of the actual date of its filing in court. Said case involved a complaint for recovery of ownership and possession of a parcel of
land with damages filed in the Court of First Instance of Cebu. Upon the payment of P60.00 for the docket fee and P10.00 for the sheriffs
fee, the complaint was docketed as Civil Case No. R-11882. The prayer of the complaint sought that the Transfer Certificate of Title issued
in the name of the defendant be declared as null and void. It was also prayed that plaintiff be declared as owner thereof to whom the
proper title should be issued, and that defendant be made to pay monthly rentals of P3,500.00 from June 2, 1948 up to the time the
property is delivered to plaintiff, P500,000.00 as moral damages, attorney's fees in the amount of P250,000.00, the costs of the action and
exemplary damages in the amount of P500,000.00.
The defendant then filed a motion to compel the plaintiff to pay the correct amount of the docket fee to which an opposition was filed by
the plaintiff alleging that the action was for the recovery of a parcel of land so the docket fee must be based on its assessed value and that
the amount of P60.00 was the correct docketing fee. The trial court ordered the plaintiff to pay P3,104.00 as filing fee.
The plaintiff then filed a motion to admit the amended complaint to include the Republic as the defendant. In the prayer of the amended
complaint the exemplary damages earlier sought was eliminated. The amended prayer merely sought moral damages as the court may
determine, attorney's fees of P100,000.00 and the costs of the action. The defendant filed an opposition to the amended complaint. The
opposition notwithstanding, the amended complaint was admitted by the trial court. The trial court reiterated its order for the payment
of the additional docket fee which plaintiff assailed and then challenged before this Court. Plaintiff alleged that he paid the total docket
fee in the amount of P60.00 and that if he has to pay the additional fee it must be based on the amended complaint.
The question posed, therefore, was whether or not the plaintiff may be considered to have filed the case even if the docketing fee paid
was not sufficient. In Magaspi, We reiterated the rule that the case was deemed filed only upon the payment of the correct amount for
the docket fee regardless of the actual date of the filing of the complaint; that there was an honest difference of opinion as to the correct
amount to be paid as docket fee in that as the action appears to be one for the recovery of property the docket fee of P60.00 was correct;
and that as the action is also one, for damages, We upheld the assessment of the additional docket fee based on the damages alleged in
the amended complaint as against the assessment of the trial court which was based on the damages alleged in the original complaint.
However, as aforecited, this Court overturned Magaspi in Manchester. Manchester involves an action for torts and damages and specific
performance with a prayer for the issuance of a temporary restraining order, etc. The prayer in said case is for the issuance of a writ of
preliminary prohibitory injunction during the pendency of the action against the defendants' announced forfeiture of the sum of P3
Million paid by the plaintiffs for the property in question, the attachment of such property of defendants that may be sufficient to satisfy
any judgment that may be rendered, and, after hearing, the issuance of an order requiring defendants to execute a contract of purchase
and sale of the subject property and annul defendants' illegal forfeiture of the money of plaintiff. It was also prayed that the defendants
be made to pay the plaintiff jointly and severally, actual, compensatory and exemplary damages as well as 25% of said amounts as may be
proved during the trial for attorney's fees. The plaintiff also asked the trial court to declare the tender of payment of the purchase price of
plaintiff valid and sufficient for purposes of payment, and to make the injunction permanent. The amount of damages sought is not
specified in the prayer although the body of the complaint alleges the total amount of over P78 Millon allegedly suffered by plaintiff.
Upon the filing of the complaint, the plaintiff paid the amount of only P410.00 for the docket fee based on the nature of the action for
specific performance where the amount involved is not capable of pecuniary estimation. However, it was obvious from the allegations of
the complaint as well as its designation that the action was one for damages and specific performance. Thus, this court held the plaintiff
must be assessed the correct docket fee computed against the amount of damages of about P78 Million, although the same was not
spelled out in the prayer of the complaint.
Meanwhile, plaintiff through another counsel, with leave of court, filed an amended complaint on September 12, 1985 by the inclusion of
another co-plaintiff and eliminating any mention of the amount of damages in the body of the complaint. The prayer in the original
complaint was maintained.
On October 15, 1985, this Court ordered the re-assessment of the docket fee in the said case and other cases that were investigated. On
November 12, 1985, the trial court directed the plaintiff to rectify the amended complaint by stating the amounts which they were asking
for. This plaintiff did as instructed. In the body of the complaint the amount of damages alleged was reduced to P10,000,000.00 but still
no amount of damages was specified in the prayer. Said amended complaint was admitted.
Applying the principle in Magaspi that "the case is deemed filed only upon payment of the docket fee regardless of the actual date of
filing in court," this Court held that the trial court did not acquire jurisdiction over the case by payment of only P410.00 for the docket fee.
Neither can the amendment of the complaint thereby vest jurisdiction upon the Court. For all legal purposes there was no such original
complaint duly filed which could be amended. Consequently, the order admitting the amended complaint and all subsequent proceedings
and actions taken by the trial court were declared null and void.13
The present case, as above discussed, is among the several cases of under-assessment of docket fee which were investigated by this Court
together with Manchester. The facts and circumstances of this case are similar to Manchester. In the body of the original complaint, the
total amount of damages sought amounted to about P50 Million. In the prayer, the amount of damages asked for was not stated. The
action was for the refund of the premium and the issuance of the writ of preliminary attachment with damages. The amount of only
P210.00 was paid for the docket fee. On January 23, 1986, private respondent filed an amended complaint wherein in the prayer it is
asked that he be awarded no less than P10,000,000.00 as actual and exemplary damages but in the body of the complaint the amount of
his pecuniary claim is approximately P44,601,623.70. Said amended complaint was admitted and the private respondent was reassessed
the additional docket fee of P39,786.00 based on his prayer of not less than P10,000,000.00 in damages, which he paid.
On April 24, 1986, private respondent filed a supplemental complaint alleging an additional claim of P20,000,000.00 in damages so that
his total claim is approximately P64,601,620.70. On October 16, 1986, private respondent paid an additional docket fee of P80,396.00.
After the promulgation of the decision of the respondent court on August 31, 1987 wherein private respondent was ordered to be
reassessed for additional docket fee, and during the pendency of this petition, and after the promulgation of Manchester, on April 28,
1988, private respondent paid an additional docket fee of P62,132.92. Although private respondent appears to have paid a total amount
of P182,824.90 for the docket fee considering the total amount of his claim in the amended and supplemental complaint amounting to
about P64,601,620.70, petitioner insists that private respondent must pay a docket fee of P257,810.49.
The principle in Manchester could very well be applied in the present case. The pattern and the intent to defraud the government of the
docket fee due it is obvious not only in the filing of the original complaint but also in the filing of the second amended complaint.
However, in Manchester, petitioner did not pay any additional docket fee until] the case was decided by this Court on May 7, 1987. Thus,
in Manchester, due to the fraud committed on the government, this Court held that the court a quo did not acquire jurisdiction over the
case and that the amended complaint could not have been admitted inasmuch as the original complaint was null and void.
In the present case, a more liberal interpretation of the rules is called for considering that, unlike Manchester, private respondent
demonstrated his willingness to abide by the rules by paying the additional docket fees as required. The promulgation of the decision in
Manchester must have had that sobering influence on private respondent who thus paid the additional docket fee as ordered by the
respondent court. It triggered his change of stance by manifesting his willingness to pay such additional docket fee as may be ordered.
Nevertheless, petitioners contend that the docket fee that was paid is still insufficient considering the total amount of the claim. This is a
matter which the clerk of court of the lower court and/or his duly authorized docket clerk or clerk in-charge should determine and,
thereafter, if any amount is found due, he must require the private respondent to pay the same.
Thus, the Court rules as follows:
1. It is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee, that vests a
trial court with jurisdiction over the subject matter or nature of the action. Where the filing of the initiatory pleading is not accompanied
by payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no case beyond the applicable
prescriptive or reglementary period.
2. The same rule applies to permissive counterclaims, third party claims and similar pleadings, which shall not be considered filed until and
unless the filing fee prescribed therefor is paid. The court may also allow payment of said fee within a reasonable time but also in no case
beyond its applicable prescriptive or reglementary period.
3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and payment of the prescribed filing fee
but, subsequently, the judgment awards a claim not specified in the pleading, or if specified the same has been left for determination by
the court, the additional filing fee therefor shall constitute a lien on the judgment. It shall be the responsibility of the Clerk of Court or his
duly authorized deputy to enforce said lien and assess and collect the additional fee.
WHEREFORE, the petition is DISMISSED for lack of merit. The Clerk of Court of the court a quo is hereby instructed to reassess and
determine the additional filing fee that should be paid by private respondent considering the total amount of the claim sought in the
original complaint and the supplemental complaint as may be gleaned from the allegations and the prayer thereof and to require private
respondent to pay the deficiency, if any, without pronouncement as to costs.
SO ORDERED.
G.R. Nos. 88075-77 December 20, 1989
MAXIMO TACAY, PONCIANO PANES and ANTONIA NOEL, petitioners,
vs.
REGIONAL TRIAL COURT OF TAGUM Davao del Norte, Branches 1 and 2, Presided by Hon. Marcial Fernandez and Hon. Jesus Matas,
respectively, PATSITA GAMUTAN, Clerk of Court, and GODOFREDO PINEDA, respondents.
Eduardo C. De Vera for petitioners.
RESOLUTION
NARVASA, J.:
In the Regional Trial Court at Tagum, Davao del Norte, 1 three
(3) actions for recovery of possession (acciones publicianas 2 ) were separately instituted by Godofredo Pineda against three (3)
defendants, docketed as follows:
1) vs. Antonia Noel Civil Case No. 2209
2) vs. Ponciano Panes Civil Case No. 2210
3) vs. Maximo Tacay Civil Case No. 2211.
Civil Cases Numbered 2209 and 2211 were raffled to Branch I of the Trial Court, presided over by Judge Marcial Hernandez. Civil No. 2210
was assigned to Branch 2, presided over by Judge Jesus Matas.
The complaints 3 all alleged the same essential facts (1) Pineda was the owner of a parcel of land measuring 790 square meters, his
ownership being evidenced by TCT No. T-46560; (2) the previous owner had allowed the defendants to occupy portions of the land by
mere tolerance; (3) having himself need to use the property, Pineda had made demands on the defendants to vacate the property and
pay reasonable rentals therefor, but these demands had been refused; and (4) the last demand had been made more than a year prior to
the commencement of suit. The complaints prayed for the same reliefs, to wit:
1) that plaintiff be declared owner of the areas occupied by the defendants;
 2) that defendants and their "privies and allies" be ordered to vacate and deliver the portions of the land usurped
by them;
3) that each defendant be ordered to pay:
1 ) P 2,000 as monthly rents from February, 1987;
2 ) Actual damages, as proven;
3 ) Moral and nominal damages as the Honorable Court may fix ;
4) P30,000.00, "as attorney's fees, and representation fees of P5,000.00 per day of appearance;" 4
and
4) that he (Pineda) be granted such "further relief and remedies ... just and equitable in the premises.
The prayer of each complaint contained a handwritten notation (evidently made by plaintiff's counsel) reading, "P5,000.00 as and for,"
immediately above the typewritten words, "Actual damages, as proven," the intention apparently being to make the entire phrase read, "
P5,000.00 as and for actual damages as proven. 5
Motions to dismiss were filed in behalf of each of the defendants by common counsel .6 Every motion alleged that the Trial Court had not
acquired jurisdiction of the case —
. . . for the reason that the ... complaint violates the mandatory and clear provision of Circular No. 7 of the ...
Supreme Court dated March 24,1988, by failing to specify all the amounts of damages which plaintiff is claiming
from defendant;" and
. . . for ... failure (of the complaint) to even allege the basic requirement as to the assessed value of the subject lot in
dispute.
Judge Matas denied the motion to dismiss filed in Civil Case No. 2210 but ordered the expunction of the "allegations in paragraph 11 of
the ... complaint regarding moral as well as nominal damages . 7 On motion of defendant Panes, Judge Matas later ordered the striking
out, too, of the "handwritten amount of 'P5,000. 00 as and for.' including the typewritten words 'actual damages as proven' ... in sub-
paragraph b of paragraph 4 in the conclusion and prayer of the complaint ..." 8
The motions to dismiss submitted in Civil Cases Numbered 2211 and 2209 were also denied in separate orders promulgated by Judge
Marcial Fernandez. 9 His Order in Case No. 2209 dated March 15, 1989 (a) declared that since the "action at bar is for Reivindicatoria,
Damages and Attorney's fees ... (d)efinitely this Court has the exclusive jurisdiction," (b) that the claims for actual, moral and nominal
damages "are only one aspect of the cause of action," and (c) because of absence of specification of the amounts claimed as moral,
nominal and actual damages, they should be "expunged from the records."
Ascribing grave abuse of discretion to both Judges Matas and Fernandez in the rendition of the Orders above described, the defendants in
all three (3) actions have filed with this Court a "Joint Petition" for certiorari, prohibition and mandamus, with prayer for temporary
restraining order and/or writ of preliminary prohibitory injunction," praying essentially that said orders be annulled and respondent
judges directed to dismiss all the complaints "without prejudice to private respondent Pineda's re-filing a similar complaint that complies
with Circular No. 7." The joint petition (a) re-asserted the proposition that because the complaints had failed to state the amounts being
claimed as actual, moral and nominal damages, the Trial Courts a quo had not acquired jurisdiction over the three (3) actions in question-
indeed, the respondent Clerk of Court should not have accepted the complaints which initiated said suits, and (b) it was not proper merely
to expunge the claims for damages and allow "the so-called cause of action for "reivindicatoria" remain for trial" by itself. 10
The joint petition should be, as it is hereby, dismissed.
It should be dismissed for failure to comply with this Court's Circular No. 1-88 (effective January 1, 1989). The copies of the challenged
Orders thereto attached 11 were not certified by the proper Clerk of Court or his duly authorized representative. Certification was made by
the petitioners' counsel, which is not allowed.
The petition should be dismissed, too, for another equally important reason. It fails to demonstrate any grave abuse of discretion on the
part of the respondent Judges in rendering the Orders complained of or, for that matter, the existence of any proper cause for the
issuance of the writ of mandamus. On the contrary, the orders appear to have correctly applied the law to the admitted facts.
It is true that the complaints do not state the amounts being claimed as actual, moral and nominal damages. It is also true, however, that
the actions are not basically for the recovery of sums of money. They are principally for recovery of possession of real property, in the
nature of an accion publiciana. Determinative of the court's jurisdiction in this type of actions is the nature thereof, not the amount of the
damages allegedly arising from or connected with the issue of title or possession, and regardless of the value of the property. Quite
obviously, an action for recovery of possession of real property (such as an accion plenaria de possesion) or the title thereof, 12 or for
partition or condemnation of, or the foreclosure of a mortgage on, said real property 13 - in other words, a real action-may be commenced
and prosecuted without an accompanying claim for actual, moral, nominal or exemplary damages; and such an action would fall within
the exclusive, original jurisdiction of the Regional Trial Court.
Batas Pambansa Bilang 129 provides that Regional Trial Courts shall exercise exclusive original jurisdiction inter alia over "all civil actions
which involve the title to, or possession of, real property, or any interest therein, except actions for forcible entry into and unlawful
detainer of lands or buildings, original jurisdiction over which is conferred upon Metropolitan Trial Courts, Municipal Trial Courts, and
Municipal Circuit Trial Courts." 14 The rule applies regardless of the value of the real property involved, whether it be worth more than
P20,000.00 or not, infra. The rule also applies even where the complaint involving realty also prays for an award of damages; the amount
of those damages would be immaterial to the question of the Court's jurisdiction. The rule is unlike that in other cases e.g., actions simply
for recovery of money or of personal property, 15 or actions in admiralty and maritime jurisdiction 16 in which the amount claimed, 17 or
the value of the personal property, is determinative of jurisdiction; i.e., the value of the personal property or the amount claimed should
exceed twenty thousand pesos (P20,000.00) in order to be cognizable by the Regional Trial Court.
Circular No. 7 of this Court, dated March 24, 1988, cannot thus be invoked, as the petitioner does, as authority for the dismissal of the
actions at bar. That circular, avowedly inspired by the doctrine laid down in Manchester Development Corporation v. Court of appeals, 149
SCRA 562 (May 7, 1987), has but limited application to said actions, as shall presently be discussed. Moreover, the rules therein laid down
have since been clarified and amplified by the Court's subsequent decision in Sun Insurance Office, Ltd. (SIOL) v. Asuncion, et al., G.R. Nos.
79937-38, February 13, 1989.
Circular No. 7 was aimed at the practice of certain parties who omit from the prayer of their complaints "any specification of the amount
of damages," the omission being "clearly intended for no other purposes than to evade the payment of the correct filing fees if not to
mislead the docket clerk, in the assessment of the filing fee." The following rules were therefore set down:
1. All complaints, petitions, answers, and similar pleadings should specify the amount of damages being prayed for not only in the body of
the pleading but also in the prayer, and said damages shall be considered in the assessment of the filing fees in any case.
2. Any pleading that fails to comply with this requirement shall not be accepted nor admitted, or shall otherwise be expunged from the
record.
3. The Court acquires jurisdiction over any case only upon the payment of the prescribed docket fee. An amendment of the complaint or
similar pleading will not thereby vest jurisdiction in the Court, much less the payment of the docket fee based on the amount sought in
the amended pleading.
The clarificatory and additional rules laid down in Sun Insurance Office, Ltd. v. Asuncion, supra, read as follows:
1. It is not simply the filing of the complaint or appropriate initiatory pleading, but (also) the payment of the prescribed docket fee that
vests a trial court with jurisdiction over the subject-matter or nature of the action. Where the filing of the initiatory pleading is not
accompanied by payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no case beyond the
applicable prescriptive or reglementary period.
2. The same rule applies to permissive counterclaims, third-party claims and similar pleadings, which shall not be considered filed until
and unless the filing fee prescribed therefor is paid. The court may also allow payment of said fee within a reasonable time but also in no
case beyond its applicable prescriptive or reglementary period.
3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and payment of the prescribed filing fee
but, subsequently, the judgment awards a claim not specified in the pleading, or if specified, the same has been left for determination by
the court, the additional filing fee therefor shall constitute a lien on the judgment. It shall be the responsibility of the Clerk of Court or his
duly authorized deputy to enforce said lien and assess and collect the additional fee.
As will be noted, the requirement in Circular No. 7 that complaints, petitions, answers, and similar pleadings should specify the amount of
damages being prayed for not only in the body of the pleading but also in the prayer, has not been altered. What has been revised is the
rule that subsequent "amendment of the complaint or similar pleading will not thereby vest jurisdiction in the Court, much less the
payment of the docket fee based on the amount sought in the amended pleading," the trial court now being authorized to allow payment
of the fee within a reasonable time but in no case beyond the applicable prescriptive or reglementary period. Moreover, a new rule has
been added, governing awards of claims not specified in the pleading - i.e., damages arising after the filing of the complaint or similar
pleading-as to which the additional filing fee therefor shall constitute a lien on the judgment.
Now, under the Rules of Court, docket or filing fees are assessed on the basis of the "sum claimed," on the one hand, or the "value of the
property in litigation or the value of the estate," on the other. 18 There are, in other words, as already above intimated, actions or
proceedings involving real property, in which the value of the property is immaterial to the court's jurisdiction, account thereof being
taken merely for assessment of the legal fees; and there are actions or proceedings, involving personal property or the recovery of money
and/or damages, in which the value of the property or the amount of the demand is decisive of the trial court's competence (aside from
being the basis for fixing the corresponding docket fees). 19
Where the action is purely for the recovery of money or damages, the docket fees are assessed on the basis of the aggregate amount
claimed, exclusive only of interests and costs. In this case, the complaint or similar pleading should, according to Circular No. 7 of this
Court, "specify the amount of damages being prayed for not only in the body of the pleading but also in the prayer, and said damages
shall be considered in the assessment of the filing fees in any case."
Two situations may arise. One is where the complaint or similar pleading sets out a claim purely for money or damages and there is no
precise statement of the amounts being claimed. In this event the rule is that the pleading will "not be accepted nor admitted, or shall
otherwise be expunged from the record." In other words, the complaint or pleading may be dismissed, or the claims as to which the
amounts are unspecified may be expunged, although as aforestated the Court may, on motion, permit amendment of the complaint and
payment of the fees provided the claim has not in the meantime become time-barred. The other is where the pleading does specify the
amount of every claim, but the fees paid are insufficient; and here again, the rule now is that the court may allow a reasonable time for
the payment of the prescribed fees, or the balance thereof, and upon such payment, the defect is cured and the court may properly take
cognizance of the action, unless in the meantime prescription has set in and consequently barred the right of action.
Where the action involves real property and a related claim for damages as well, the legal fees shall be assessed on the basis of both (a)
the value of the property and (b) the total amount of related damages sought. The Court acquires jurisdiction over the action if the filing
of the initiatory pleading is accompanied by the payment of the requisite fees, or, if the fees are not paid at the time of the filing of the
pleading, as of the time of full payment of the fees within such reasonable time as the court may grant, unless, of course, prescription has
set in the meantime. But where-as in the case at bar-the fees prescribed for an action involving real property have been paid, but the
amounts of certain of the related damages (actual, moral and nominal) being demanded are unspecified, the action may not be dismissed.
The Court undeniably has jurisdiction over the action involving the real property, acquiring it upon the filing of the complaint or similar
pleading and payment of the prescribed fee. And it is not divested of that authority by the circumstance that it may not have acquired
jurisdiction over the accompanying claims for damages because of lack of specification thereof. What should be done is simply to expunge
those claims for damages as to which no amounts are stated, which is what the respondent Courts did, or allow, on motion, a reasonable
time for the amendment of the complaints so as to allege the precise amount of each item of damages and accept payment of the
requisite fees therefor within the relevant prescriptive period.
WHEREFORE, the petition is DISMISSED, without pronouncement as to costs.
Fernan, C.J., Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano, Gancayco, Padilla, Bidin, Sarmiento, Cortes, Griño-Aquino, Medialdea
and Regalado, JJ., concur.
G.R. No. 88421 January 30, 1990
AYALA CORPORATION, LAS PIÑAS VENTURES, INC., and FILIPINAS LIFE ASSURANCE COMPANY, INC., petitioners
vs.
THE HONORABLE JOB B. MADAYAG, PRESIDING JUDGE, REGIONAL TRIAL COURT, NATIONAL CAPITAL JUDICIAL REGION, BRANCH 145
and THE SPOUSES CAMILO AND MA. MARLENE SABIO, respondents.
Renato L. De la Fuente for petitioners.
Camilo L. Sabio for private respondents.
GANCAYCO, J.:
Once more the issue relating to the payment of filing fees in an action for specific performance with damages is presented by this petition
for prohibition.
Private respondents filed against petitioners an action for specific performance with damages in the Regional Trial Court of Makati.
Petitioners filed a motion to dismiss on the ground that the lower court has not acquired jurisdiction over the case as private respondents
failed to pay the prescribed docket fee and to specify the amount of exemplary damages both in the body and prayer of the amended and
supplemental complaint. The trial court denied the motion in an order dated April 5, 1989. A motion for reconsideration filed by
petitioners was likewise denied in an order dated May 18, 1989. Hence this petition.
The main thrust of the petition is that private respondent paid only the total amount of P l,616.00 as docket fees instead of the amount of
P13,061.35 based on the assessed value of the real properties involved as evidenced by its tax declaration. Further, petitioners contend
that private respondents failed to specify the amount of exemplary damages sought both in the body and the prayer of the amended and
supplemental complaint.
In Manchester Development Corporation vs. Court of Appeals 1 a similar case involving an action for specific performance with damages,
this Court held that the docket fee should be assessed by considering the amount of damages as alleged in the original complaint.
However, the contention of petitioners is that since the action concerns real estate, the assessed value thereof should be considered in
computing the fees pursuant to Section 5, Rule 141 of the Rules of Court. Such rule cannot apply to this case which is an action for specific
performance with damages although it is in relation to a transaction involving real estate. Pursuant to Manchester, the amount of the
docket fees to be paid should be computed on the basis of the amount of damages stated in the complaint.
Petitioners also allege that because of the failure of the private respondents to state the amount of exemplary damages being sought, the
complaint must nevertheless be dismissed in accordance to Manchester. The trial court denied the motion stating that the determination
of the exemplary damages is within the sound discretion of the court and that it would be unwarrantedly presumptuous on the part of the
private respondents to fix the amount of exemplary damages being prayed for. The trial court cited the subsequent case of Sun Insurance
vs. Judge Asuncion 2 in support of its ruling.
The clarificatory and additional rules laid down in Sun Insurance are as follows:
1. It is not simply the filing of the complaint or appropriate initiatory pleading, but (also) the payment of the prescribed docket
fee that vests a trial court with jurisdiction over the subject-matter or nature of the action. Where the filing of the initiatory
pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a reasonable tune
but in no case beyond the applicable prescriptive or reglementary period.
2. The same rule applies to permissive counterclaims, third party claims and similar pleadings, which shall not be considered
filed until and unless the filing fee prescribed therefor is paid. The court may also allow payment of said fee within a
reasonable time but also in no case beyond its applicable prescriptive or reglementary period.
3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and payment of the
prescribed filing fee but, subsequently, the judgment awards a claim not specified in the pleading, or if specified, the same has
been left for determination by the court, the additional filing fee therefor shall constitute a lien on the judgment. It shall be the
responsibility of the Clerk of Court or his duly authorized deputy to enforce said lien and assess and collect the additional fee.
Apparently, the trial court misinterpreted paragraph 3 of the above ruling of this Court wherein it is stated that "where the judgment
awards a claim not specified in the pleading, or if specified, the same has been left for the determination of the court, the additional filing
fee therefor shall constitute a lien on the judgment" by considering it to mean that where in the body and prayer of the complaint there is
a prayer, say for exemplary or corrective damages, the amount of which is left to the discretion of the Court, there is no need to specify
the amount being sought, and that any award thereafter shall constitute a lien on the judgment.
In the latest case Tacay vs. Regional Trial Court of Tagum, 3 this Court had occasion to make the clarification that the phrase "awards of
claims not specified in the pleading" refers only to "damages arising after the filing of the complaint or similar pleading . . . as to which the
additional filing fee therefor shall constitute a lien on the judgment." The amount of any claim for damages, therefore, arising on or
before the filing of the complaint or any pleading, should be specified. While it is true that the determination of certain damages as
exemplary or corrective damages is left to the sound discretion of the court, it is the duty of the parties claiming such damages to specify
the amount sought on the basis of which the court may make a proper determination, and for the proper assessment of the appropriate
docket fees. The exception contemplated as to claims not specified or to claims although specified are left for determination of the court
is limited only to any damages that may arise after the filing of the complaint or similar pleading for then it will not be possible for the
claimant to specify nor speculate as to the amount thereof.
The amended and supplemental complaint in the present case, therefore, suffers from the material defect in failing to state the amount
of exemplary damages prayed for.
As ruled in Tacay the trial court may either order said claim to be expunged from the record as it did not acquire jurisdiction over the
same or on motion, it may allow, within a reasonable time, the amendment of the amended and supplemental complaint so as to state
the precise amount of the exemplary damages sought and require the payment of the requisite fees therefor within the relevant
prescriptive period. 4
WHEREFORE, the petition is GRANTED. The trial court is directed either to expunge from the record the claim for exemplary damages in
the amended and supplemental complaint, the amount of which is not specified, or it may otherwise, upon motion, give reasonable time
to private respondents to amend their pleading by specifying its amount and paying the corresponding docketing fees within the
appropriate reglementary or prescriptive period. No costs.
SO ORDERED.
Narvasa, Cruz, Griño-Aquino and Medialdea, JJ., concur.
NEGROS ORIENTAL PLANTERS ASSOCIATION, INC. (NOPA), G.R. No. 179878
Petitioner,
Present:
- versus - YNARES-SANTIAGO, J.,
Chairperson,
AUSTRIA-MARTINEZ,
CHICO-NAZARIO,
NACHURA, and
HON. PRESIDING JUDGE OF RTC-NEGROS OCCIDENTAL, REYES, JJ.
BRANCH 52, BACOLOD CITY, and ANICETO
MANOJO CAMPOS,
Respondents.
Promulgated:
December 24, 2008
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DECISION

CHICO-NAZARIO, J.:
Whats sauce for the goose is sauce for the gander.
This is a Petition for Review on Certiorari seeking the reversal of the Resolutions[1] of the Court of Appeals dated 23 May 2007
and 16 August 2007, respectively, in CA-G.R. SP No. 02651 outrightly dismissing the Petition for Certiorari filed by petitioner Negros
Oriental Planters Association, Inc. (NOPA) against private respondent Aniceto Manojo Campos (Campos).
On 17 March 1999, Campos filed a Complaint for Breach of Contract with Damages, docketed as Civil Case No. 99-10773,
against NOPA before the Regional Trial Court (RTC) of Negros Occidental, Bacolod City. According to the Complaint, Campos and NOPA
entered into two separate contracts denominated as Molasses Sales Agreement.Campos allegedly paid the consideration of the Molasses
Sales Agreement in full, but was only able to receive a partial delivery of the molasses because of a disagreement as to the quality of the
products being delivered.
On 17 August 2005, more than six years after NOPA filed its Answer, NOPA filed a Motion to Dismiss on the ground of an
alleged failure of Campos to file the correct filing fee. According to NOPA, Campos deliberately concealed in his Complaint the exact
amount of actual damages by opting to estimate the value of the unwithdrawn molasses in order to escape the payment of the proper
docket fees.
On 30 June 2006, the RTC issued an Order denying the Motion to Dismiss. NOPA received this Order on 17 July 2006.
On 1 August 2006, NOPA filed a Motion for Reconsideration of the 30 June 2006 Order. On 5 January 2007, the RTC issued an
Order denying NOPAs Motion for Reconsideration.
On 2 April 2007, NOPA filed a Petition for Certiorari before the Court of Appeals assailing the Orders of the RTC dated 30 June
2006 and 5 January 2007.
On 23 May 2007, the Court of Appeals issued the first assailed Resolution dismissing the Petition for Certiorari on the following
grounds:
1. Failure of the Petitioner to state in its Verification that the allegations in the petition are based on
authentic records, in violation of Section 4, Rule 7, of the 1997 Rules of Civil Procedure, as amended by A.M. No. 00-
2-10-SC (May 1, 2000), which provides:
x x x - A pleading is verified by an affidavit that the affiant has read the pleading
and that the allegations therein are true and correct of his personal knowledge or based on
authentic records.
A pleading required to be verified which contains a verification based on
information and belief, or lacks a proper verification, shall be treated as an unsigned pleading.
2. Failure of the petitioner to append to the petition relevant pleadings and documents, which would aid
in the resolution of the instant petition, in violation of Section 1, Rule 65 of the Rules of Court, such as:
a. Ex-parte Motion to Set the Case for Pre-Trial dated July 27, 1999;
b. Notice of Pre-Trial;
c. Motion for Leave to File Third Party Complaint;
d. Orders dated July 31, 2000, March 20 2001, November 17, 2004, and May 17, 2005, respectively;
e. Motion to Suspend the Proceedings dated August 10, 2003;
f. Motion to Dismiss for Failure to Prosecute; and
g. Motion for Reconsideration to the Order dated May 12, 2005.
Section 1, Rule 65 of the Rules of Court, provides:
When any tribunal, board or officer exercising judicial or quasi-judicial functions
has acted without or in excess of its or his jurisdiction, or with grave abuse of discretion
amounting to lack or excess of jurisdiction, and there is no appeal, or any plain, speedy, and
adequate remedy in the ordinary course of law, a person aggrieved thereby may file a verified
petition in the proper court, alleging the facts with certainty and praying that judgment be
rendered annulling or modifying the proceedings of such tribunal, board or officer, and
granting such incidental reliefs as law and justice may require.
The petition shall be accompanied by a certified true copy of the judgment, order
or resolution subject thereof, copies of all pleadings and documents relevant and pertinent
thereto, and a sworn certification of non-forum shopping as provided in the paragraph of
section 3, Rule 46.
3. Failure of petitioners counsel to indicate in the petition his current IBP Official Receipt Number, in
violation of Bar Matter No. 1132 and/or A.M. No. 287, which reads as follows:
The Court resolved, upon recommendation of the Office of the Bar Confidant, to
GRANT the request of the Board of Governors of the Integrated Bar of the Philippinesand the
Sanguniang Panlalawigan of Ilocos Norte to require all lawyers to indicate their Roll of
Attorneys Number in all papers or pleadings submitted to the various judicial or quasi-judicial
bodies in addition to the requirement of indicating the current Professional Tax Receipt (PTR)
and the IBP Official Receipt or Lifetime Member Number.[2]
On 22 June 2007, NOPA filed a Motion for Reconsideration of the above Resolution, attaching thereto an Amended Petition
for Certiorari in compliance with the requirements of the Court of Appeals deemed to have been violated by NOPA. The Court of Appeals
denied the said Motion in the second assailed Resolution dated 16 August 2007.
Hence, this Petition for Review on Certiorari, where NOPA raises the following issue and arguments:
ISSUE
WHETHER OR NOT THE PUBLIC RESPONDENT CA COMMITTED REVERSIBLE ERROR WHEN IT RULED THAT THERE
WAS NO SUBSTANTIAL COMPLIANCE WITH THE PROCEDURAL REQUIREMENTS WHEN PETITIONER FAILED TO
ALLEGE IN ITS VERIFICATION THAT THE ALLEGATIONS THEREIN ARE TRUE AND CORRECT OF HIS PERSONAL
KNOWLEDGE OR BASED ON AUTHENTIC RECORDS AND FAILURE TO ATTACH THE NECESSARY DOCUMENTS ON ITS
PLEADINGS AS REQUIRED BY SECTION 1, RULE 65 OF THE 1997 RULES OF CIVIL PROCEDURE.[3]
ARGUMENTS
1. The requirement that a pleading be verified is merely formal and not jurisdictional. The court may give
due course to an unverified pleading where the material facts alleged are a matter of record and the questions
raised are mainly of law such as in a petition for certiorari.[4]
2. Petitioner had attached to its Petition for Certiorari clearly legible and duplicate original or a certified
true copy of the judgment or final order or resolution of the court a quo and the requisite number of plain copies
thereof and such material portions of the record as would support the petition.[5]
3. Substantial compliance of the rules, which was further supplied by the petitioners subsequent full
compliance demonstrates its good faith to abide by the procedural requirements.[6]
4. The resolution of the important jurisdictional issue raised by the petitioner before the PUBLIC
RESPONDENT CA would justify a relaxation of the rules.[7]
The original Verification in the original Petition for Certiorari filed by NOPA states as follows:

1. That I am the President and Chairman of the Board of Directors of Negros Oriental Planters
Association, Inc. (NOPA), the petitioner in this case, a domestic corporation duly organized under Philippine Laws,
with principal place of business at Central Bais, Bais City, Philippines; that I am duly authorized by the Board of
NOPA (Secretarys Certificate attached as Annex A) to cause the preparation of the foregoing petition; and that I
hereby affirm and confirm that all the allegations contained herein are true and correct to my own knowledge and
belief;[8]
NOPA claims that this Court has in several cases allowed pleadings with a Verification that contains the allegation to the best
of my knowledge and the allegation are true and correct, without the words of his own knowledge, citing Decano v. Edu,[9] and Quimpo v.
De la Victoria.[10] NOPA claims that the allegations in these cases constitute substantial compliance with the Rules of Court, and should
likewise apply to the case at bar.
NOPA is mistaken. NOPA cited cases promulgated before 1 May 2000, when Section 4 of Rule 7 was amended by A.M. No. 00-
2-10. Before the amendment, said Section 4 stated:
SEC. 4. Verification.Except when otherwise specifically required by law or rule, pleadings need not be
under oath, verified or accompanied by affidavit.
A pleading is verified by an affidavit that the affiant has read the pleading and that the allegations
therein are true and correct of his knowledge and belief.
As amended, said Section 4 now states:
SEC. 4. Verification.Except when otherwise specifically required by law or rule, pleadings need not be
under oath, verified or accompanied by affidavit.
A pleading is verified by an affidavit that the affiant has read the pleading and that the allegations
therein are true and correct of his personal knowledge or based on authentic records.
Clearly, the amendment was introduced in order to make the verification requirement stricter, such that the party cannot now
merely state under oath that he believes the statements made in the pleading. He cannot even merely state under oath that he has
knowledge that such statements are true and correct. His knowledge must be specifically alleged under oath to be either personal
knowledge or at least based on authentic records.
Unlike, however, the requirement for a Certification against Forum Shopping in Section 5, wherein failure to comply with the
requirements is not curable by amendment of the complaint or other initiatory pleading,[11] Section 4 of Rule 7, as amended, states that
the effect of the failure to properly verify a pleading is that the pleading shall be treated as unsigned:
A pleading required to be verified which contains a verification based on information and belief,
or upon knowledge, information and belief, or lacks a proper verification, shall be treated as an unsigned
pleading.
Unsigned pleadings are discussed in the immediately preceding section of Rule 7:
SEC. 3. Signature and address. x x x.
xxxx
An unsigned pleading produces no legal effect. However, the court may, in its discretion, allow such
deficiency to be remedied if it shall appear that the same was due to mere inadvertence and not intended for delay.
Counsel who deliberately files an unsigned pleading, or signs a pleading in violation of this Rule, or alleges
scandalous or indecent matter therein, or fails to promptly report to the court a change of his address, shall be
subject to appropriate disciplinary action. (5a)
A pleading, therefore, wherein the Verification is merely based on the partys knowledge and belief produces no legal effect,
subject to the discretion of the court to allow the deficiency to be remedied. In the case at bar, the Court of Appeals, in the exercise of
this discretion, refused to allow the deficiency in the Verification to be remedied, by denying NOPAs Motion for Reconsideration with
attached Amended Petition for Certiorari.
May an appellate court reverse the exercise of discretion by a lower court? The old case of Lino Luna v. Arcenas[12] states
that it can, but only in exceptional cases when there is grave abuse of this discretion or adverse effect on the substantial rights of a
litigant:
Discretionary power is generally exercised by trial judges in furtherance of the convenience of the courts
and the litigants, the expedition of business, and in the decision of interlocutory matters on conflicting facts where
one tribunal could not easily prescribe to another the appropriate rule of procedure.
The general rule, therefore, and indeed one of the fundamental principles of appellate procedure is that
decisions of a trial court which "lie in discretion" will not be reviewed on appeal, whether the case be civil or
criminal at law or in equity.
We have seen that where such rulings have to do with minor matters, not affecting the substantial rights
of the parties, the prohibition of review in appellate proceedings is made absolute by the express terms of the
statute; but it would be a monstrous travesty on justice to declare that where the exercise of discretionary power
by an inferior court affects adversely the substantial legal rights of a litigant, it is not subject to review on appeal
in any case wherein a clear and affirmative showing is made of an abuse of discretion, or of a total lack of its
exercise, or of conduct amounting to an abuse of discretion, such as its improper exercise under a
misapprehension of the law applicable to the facts upon which the ruling is based.
In its very nature, the discretionary control conferred upon the trial judge over the proceedings had
before him implies the absence of any hard-and-fast rule by which it is to be exercised, and in accordance with
which it may be reviewed. But the discretion conferred upon the courts is not a willful, arbitrary, capricious and
uncontrolled discretion. It is a sound, judicial discretion which should always be exercised with due regard to the
rights of the parties and the demands of equity and justice. As was said in the case of The Styria vs. Morgan (186 U.
S., 1, 9): "The establishment of a clearly defined rule of action would be the end of discretion, and yet discretion
should not be a word for arbitrary will or inconsiderate action." So in the case of Goodwin vs. Prime (92 Me., 355), it
was said that "discretion implies that in the absence of positive law or fixed rule the judge is to decide by his view of
expediency or by the demands of equity and justice."
There being no "positive law or fixed rule" to guide the judge in the court below in such cases, there is no
"positive law or fixed rule" to guide a court of appeal in reviewing his action in the premises, and such courts will
not therefore attempt to control the exercise of discretion by the court below unless it plainly appears that there
was "inconsiderate action" or the exercise of mere "arbitrary will," or in other words that his action in the premises
amounted to "an abuse of discretion." But the right of an appellate court to review judicial acts which lie in the
discretion of inferior courts may properly be invoked upon a showing of a strong and clear case of abuse of power
to the prejudice of the appellant, or that the ruling objected to rested on an erroneous principle of law not vested in
discretion.[13]
The case at bar demonstrates a situation in which there is no effect on the substantial rights of a litigant. NOPAs Petition
for Certiorari is seeking the reversal of the Orders of the RTC denying NOPAs Motion to Dismiss on the ground of failure to pay the proper
docket fees. The alleged deficiency in the payment of docket fees by Campos, if there is any, would not inure to the benefit of NOPA.
There is therefore no substantive right that will be prejudiced by the Court of Appeals exercise of discretion in the case at
bar. While the payment of docket fees is jurisdictional, it is nevertheless unmistakably also a technicality. Ironically, in seeking the leniency
of this Court on the basis of substantial justice, NOPA is ultimately praying for a Writ of Certiorari enjoining the action for breach of
contract from being decided on the merits. Whats sauce for the goose is sauce for the gander. A party cannot expect its opponent to
comply with the technical rules of procedure while, at the same time, hoping for the relaxation of the technicalities in its favor.
 There was therefore no grave abuse of discretion on the part of the Court of Appeals warranting this Courts reversal of the
exercise of discretion by the former. However, even if we decide to brush aside the lapses in technicalities on the part of NOPA in its
Petition for Certiorari, we nevertheless find that such Petition would still fail.
NOPA seeks in its Petition for Certiorari for the application of this Courts ruling in Manchester Development Corporation v.
Court of Appeals,[14] wherein we ruled that the court acquires jurisdiction over any case only upon payment of the prescribed docket fee.
An amendment of the complaint or similar pleading will not thereby vest jurisdiction in the court, much less the payment of the docket
fee based on the amount sought in the amended pleading.
In denying[15] NOPAs Motion to Dismiss, the RTC cited Sun Insurance Office, Ltd. (SIOL) v. Asuncion,[16] wherein we modified our
ruling in Manchester and decreed that where the initiatory pleading is not accompanied by the payment of the docket fee, the court may
allow payment of the fee within a reasonable period of time, but in no case beyond the applicable prescriptive or reglementary
period. The aforesaid ruling was made on the justification that, unlike in Manchester, the private respondent in Sun Insurance Office, Ltd.
(SIOL) demonstrated his willingness to abide by the rules by paying the additional docket fees required. NOPA claims that Sun is not
applicable to the case at bar, since Campos deliberately concealed his claim for damages in the prayer.
In United Overseas Bank (formerly Westmont Bank) v. Ros,[17] we discussed how Manchester was not applicable to said case in
view of the lack of deliberate intent to defraud manifested in the latter:
This Court wonders how the petitioner could possibly arrive at the conclusion that the private respondent was
moved by fraudulent intent in omitting the amount of damages claimed in its Second Amended Complaint, thus
placing itself on the same footing as the complainant in Manchester, when it is clear that the factual milieu of the
instant case is far from that of Manchester.
First, the complainant in Manchester paid the docket fee only in the amount of P410.00,
notwithstanding its claim for damages in the amount of P78,750,000.00, while in the present case, the private
respondent paid P42,000.00 as docket fees upon filing of the original complaint.
Second, complainant's counsel in Manchester claimed, in the body of the complaint, damages in the
amount of P78,750.00 but omitted the same in its prayer in order to evade the payment of docket fees. Such fraud-
defining circumstance is absent in the instant petition.
Finally, when the court took cognizance of the issue of non-payment of docket fees in Manchester, the
complainant therein filed an amended complaint, this time omitting all mention of the amount of damages being
claimed in the body of the complaint; and when directed by the court to specify the amount of damages in such
amended complaint, it reduced the same from P78,750,000.00 to P10,000,000.00, obviously to avoid payment of
the required docket fee. Again, this patent fraudulent scheme is wanting in the case at bar.
This Court is not inclined to adopt the petitioner's piecemeal construction of our rulings
in Manchester and Sun Insurance. Its attempt to strip the said landmark cases of one or two lines and use them to
bolster its arguments and clothe its position with jurisprudential blessing must be struck down by this Court.
All told, the rule is clear and simple. In case where the party does not deliberately intend to defraud
the court in payment of docket fees, and manifests its willingness to abide by the rules by paying additional
docket fees when required by the court, the liberal doctrine enunciated in Sun Insurance and not the strict
regulations set in Manchester will apply.
In the case at bar, Campos filed an amount of P54,898.50 as docket fee, based on the amounts of P10,000,000.00 representing
the value of unwithdrawn molasses, P100,00.00 as storage fee, P200,00.00 as moral damages, P100,000.00 as exemplary damages
and P500,000.00 as attorneys fees. The total amount considered in computing the docket fee was P10,900,000.00. NOPA alleges
that Campos deliberately omitted a claim for unrealized profit of P100,000.00 and an excess amount of storage fee in the amount
of P502,875.98 in its prayer and, hence, the amount that should have been considered in the payment of docket fees
is P11,502,875.98. The amount allegedly deliberately omitted was therefore only P602,875.98 out of P11,502,875.98, or merely 5.2% of
said alleged total. Camposs pleadings furthermore evince his willingness to abide by the rules by paying the additional docket fees when
required by the Court.
Since the circumstances of this case clearly show that there was no deliberate intent to defraud the Court in the payment of
docket fees, the case of Sun should be applied, and the Motion to Dismiss by NOPA should be denied.
WHEREFORE, the Resolutions of the Court of Appeals dated 23 May 2007 and 16 August 2007, respectively, in CA-G.R. SP No.
02651, outrightly dismissing the Petition for Certiorari filed by petitioner Negros Oriental Planters Association, Inc. against private
respondent Aniceto Manojo Campos, are AFFIRMED. No costs.
SO ORDERED.
MINITA V. CHICO-NAZARIO
Associate Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
EIRS OF BERTULDO[1] HINOG: Bertuldo Hinog II, Bertuldo Hinog III, Bertuldo Hinog, Jr., Jocelyn Hinog, Bertoldo Hinog IV, Bertoldo Hinog
V, Edgardo Hinog, Milagros H. Pabatao, Lilian H. King, Victoria H. Engracia, Terisita C. Hinog, Paz H. Besana, Roberto C. Hinog,
Vicente C. Hinog, Roel C. Hinog, Marilyn C. Hinog, Bebot C. Hinog, lordes C. Hinog, Pablo Chiong, Arlene Lanasang (All
respresented by Bertuldo Hinog III), petitioners, vs. HON. ACHILLES MELICOR, in his capacity as Presiding Judge, RTC, Branch
4, 7th Judicial Region, Tagbiliran City, Bohol, and CUSTODIO BALANE, RUFO BALANE, HONORIO BALANE, and TOMAS
BALANE, respondents.
DECISION
AUSTRIA-MARTINEZ, J.:
Before us is a petition for certiorari and prohibition under Rule 65 of the Rules of Court which assails the Orders dated March 22,
1999, August 13, 1999 and October 15, 1999 of the Regional Trial Court, Branch 4, of Tagbilaran City, Bohol in Civil Case No. 4923.
The factual background of the case is as follows:
On May 21, 1991, private respondents Custodio, Rufo, Tomas and Honorio, all surnamed Balane, filed a complaint for Recovery of
Ownership and Possession, Removal of Construction and Damages against Bertuldo Hinog (Bertuldo for brevity). They alleged that: they
own a 1,399- square meter parcel of land situated in Malayo Norte, Cortes, Bohol, designated as Lot No. 1714; sometime in March 1980,
they allowed Bertuldo to use a portion of the said property for a period of ten years and construct thereon a small house of light materials
at a nominal annual rental of P100.00 only, considering the close relations of the parties; after the expiration of the ten-year period, they
demanded the return of the occupied portion and removal of the house constructed thereon but Bertuldo refused and instead claimed
ownership of the entire property.
Accordingly, private respondents sought to oust Bertuldo from the premises of the subject property and restore upon themselves
the ownership and possession thereof, as well as the payment of moral and exemplary damages, attorneys fees and litigation expenses in
amounts justified by the evidence. [2]
On July 2, 1991, Bertuldo filed his Answer. He alleged ownership of the disputed property by virtue of a Deed of Absolute Sale
dated July 2, 1980, executed by one Tomas Pahac with the knowledge and conformity of private respondents.[3]
After the pre-trial, trial on the merits ensued. On November 18, 1997, private respondents rested their case. Thereupon, Bertuldo
started his direct examination. However, on June 24, 1998, Bertuldo died without completing his evidence.
On August 4, 1998, Atty. Sulpicio A. Tinampay withdrew as counsel for Bertuldo as his services were terminated by petitioner
Bertuldo Hinog III. Atty. Veronico G. Petalcorin then entered his appearance as new counsel for Bertuldo.[4]
On September 22, 1998, Atty. Petalcorin filed a motion to expunge the complaint from the record and nullify all court proceedings
on the ground that private respondents failed to specify in the complaint the amount of damages claimed so as to pay the correct docket
fees; and that under Manchester Development Corporation vs. Court of Appeals,[5] non-payment of the correct docket fee is
jurisdictional.[6]
 In an amended motion, filed on October 2, 1998, Atty. Petalcorin further alleged that the private respondents failed to pay the
correct docket fee since the main subject matter of the case cannot be estimated as it is for recovery of ownership, possession and
removal of construction.[7]
Private respondents opposed the motion to expunge on the following grounds: (a) said motion was filed more than seven years
from the institution of the case; (b) Atty. Petalcorin has not complied with Section 16, Rule 3 of the Rules of Court which provides that the
death of the original defendant requires a substitution of parties before a lawyer can have legal personality to represent a litigant and the
motion to expunge does not mention of any specific party whom he is representing; (c) collectible fees due the court can be charged as
lien on the judgment; and (d) considering the lapse of time, the motion is merely a dilatory scheme employed by petitioners.[8]
In their Rejoinder, petitioners manifested that the lapse of time does not vest the court with jurisdiction over the case due to
failure to pay the correct docket fees. As to the contention that deficiency in payment of docket fees can be made as a lien on the
judgment, petitioners argued that the payment of filing fees cannot be made dependent on the result of the action taken.[9]
On January 21, 1999, the trial court, while ordering the complaint to be expunged from the records and the nullification of all court
proceedings taken for failure to pay the correct docket fees, nonetheless, held:
The Court can acquire jurisdiction over this case only upon the payment of the exact prescribed docket/filing fees for the main cause of
action, plus additional docket fee for the amount of damages being prayed for in the complaint, which amount should be specified so that
the same can be considered in assessing the amount of the filing fees. Upon the complete payment of such fees, the Court may take
appropriate action in the light of the ruling in the case of Manchester Development Corporation vs. Court of Appeals, supra.[10]
Accordingly, on January 28, 1999, upon payment of deficiency docket fee, private respondents filed a manifestation with prayer to
reinstate the case.[11] Petitioners opposed the reinstatement[12] but on March 22, 1999, the trial court issued the first assailed Order
reinstating the case.[13]
On May 24, 1999, petitioners, upon prior leave of court,[14] filed their supplemental pleading, appending therein a Deed of Sale
dated November 15, 1982.[15] Following the submission of private respondents opposition thereto,[16] the trial court, in its Order dated July
7, 1999, denied the supplemental pleading on the ground that the Deed of Absolute Sale is a new matter which was never mentioned in
the original answer dated July 2, 1991, prepared by Bertuldos original counsel and which Bertuldo verified; and that such new document is
deemed waived in the light of Section 1, Rule 9[17] of the Rules of Court. The trial court also noted that no formal substitution of the
parties was made because of the failure of defendants counsel to give the names and addresses of the legal representatives of Bertuldo,
so much so that the supposed heirs of Bertuldo are not specified in any pleading in the case. [18]
On July 14, 1999, petitioners manifested that the trial court having expunged the complaint and nullified all court proceedings,
there is no valid case and the complaint should not be admitted for failure to pay the correct docket fees; that there should be no case to
be reinstated and no case to proceed as there is no complaint filed.[19]
After the submission of private respondents opposition[20] and petitioners rejoinder,[21] the trial court issued the second assailed
Order on August 13, 1999, essentially denying petitioners manifestation/rejoinder. The trial court held that the issues raised in such
manifestation/rejoinder are practically the same as those raised in the amended motion to expunge which had already been passed upon
in the Order dated January 21, 1999. Moreover, the trial court observed that the Order dated March 22, 1999 which reinstated the case
was not objected to by petitioners within the reglementary period or even thereafter via a motion for reconsideration despite receipt
thereof on March 26, 1999.[22]
On August 25, 1999, petitioners filed a motion for reconsideration[23] but the same was denied by the trial court in its third assailed
Order dated October 15, 1999. The trial court held that the Manchester rule was relaxed in Sun Insurance Office, Ltd. vs.
Asuncion.[24] Noting that there has been no substitution of parties following the death of Bertuldo, the trial court directed Atty. Petalcorin
to comply with the provisions of Section 16, Rule 3 of the Rules of Court. The trial court also reiterated that the Order dated March 22,
1999 reinstating the case was not assailed by petitioners within the reglementary period, despite receipt thereof on March 26, 1999.[25]
On November 19, 1999, Atty. Petalcorin complied with the directive of the trial court to submit the names and addresses of the
heirs of Bertuldo.[26]
On November 24, 1999, petitioners filed before us the present petition for certiorari and prohibition.[27] They allege that the public
respondent committed grave abuse of discretion in allowing the case to be reinstated after private respondents paid the docket fee
deficiency since the trial court had earlier expunged the complaint from the record and nullified all proceedings of the case and such
ruling was not contested by the private respondents. Moreover, they argue that the public respondent committed grave abuse of
discretion in allowing the case to be filed and denying the manifestation with motion to dismiss, despite the defect in the complaint which
prayed for damages without specifying the amounts, in violation of SC Circular No. 7, dated March 24, 1988.
In their Comment, private respondents aver that no grave abuse of discretion was committed by the trial court in reinstating the
complaint upon the payment of deficiency docket fees because petitioners did not object thereto within the reglementary period.
Besides, Atty. Petalcorin possessed no legal personality to appear as counsel for the heirs of Bertuldo until he complies with Section 16,
Rule 3 of the Rules of Court.[28]
At the outset, we note the procedural error committed by petitioners in directly filing the instant petition before this Court for it
violates the established policy of strict observance of the judicial hierarchy of courts.
Although the Supreme Court, Court of Appeals and the Regional Trial Courts have concurrent jurisdiction to issue writs of certiorari,
prohibition, mandamus, quo warranto, habeas corpus and injunction, such concurrence does not give the petitioner unrestricted freedom
of choice of court forum.[29] As we stated in People vs. Cuaresma:[30]
This Court's original jurisdiction to issue writs of certiorari is not exclusive. It is shared by this Court with Regional Trial Courts and with
the Court of Appeals. This concurrence of jurisdiction is not, however, to be taken as according to parties seeking any of the writs an
absolute, unrestrained freedom of choice of the court to which application therefor will be directed. There is after all a hierarchy of
courts. That hierarchy is determinative of the venue of appeals, and also serves as a general determinant of the appropriate forum for
petitions for the extraordinary writs. A becoming regard for that judicial hierarchy most certainly indicates that petitions for the issuance
of extraordinary writs against first level (inferior) courts should be filed with the Regional Trial Court, and those against the latter, with the
Court of Appeals. A direct invocation of the Supreme Courts original jurisdiction to issue these writs should be allowed only when there
are special and important reasons therefor, clearly and specifically set out in the petition. This is [an] established policy. It is a policy
necessary to prevent inordinate demands upon the Courts time and attention which are better devoted to those matters within its
exclusive jurisdiction, and to prevent further over-crowding of the Courts docket.[31]
The rationale for this rule is two-fold: (a) it would be an imposition upon the precious time of this Court; and (b) it would cause an
inevitable and resultant delay, intended or otherwise, in the adjudication of cases, which in some instances had to be remanded or
referred to the lower court as the proper forum under the rules of procedure, or as better equipped to resolve the issues because this
Court is not a trier of facts.[32]
Thus, this Court will not entertain direct resort to it unless the redress desired cannot be obtained in the appropriate courts, and
exceptional and compelling circumstances, such as cases of national interest and of serious implications, justify the availment of the
extraordinary remedy of writ of certiorari, calling for the exercise of its primary jurisdiction. Exceptional and compelling circumstances
were held present in the following cases: (a) Chavez vs. Romulo[33] on citizens right to bear arms; (b) Government of the United States of
America vs. Purganan[34] on bail in extradition proceedings; (c) Commission on Elections vs. Quijano-Padilla[35] on government contract
involving modernization and computerization of voters registration list; (d) Buklod ng Kawaning EIIB vs. Zamora[36] on status and existence
of a public office; and (e) Fortich vs. Corona[37] on the so-called Win-Win Resolution of the Office of the President which modified the
approval of the conversion to agro-industrial area.
In this case, no special and important reason or exceptional and compelling circumstance analogous to any of the above cases has
been adduced by the petitioners so as to justify direct recourse to this Court. The present petition should have been initially filed in the
Court of Appeals in strict observance of the doctrine on the hierarchy of courts. Failure to do so is sufficient cause for the dismissal of the
petition at bar.
In any event, even if the Court disregards such procedural flaw, the petitioners contentions on the substantive aspect of the case
fail to invite judgment in their favor.
The unavailability of the writ of certiorari and prohibition in this case is borne out of the fact that petitioners principally assail the
Order dated March 22, 1999 which they never sought reconsideration of, in due time, despite receipt thereof on March 26, 1999. Instead,
petitioners went through the motion of filing a supplemental pleading and only when the latter was denied, or after more than three
months have passed, did they raise the issue that the complaint should not have been reinstated in the first place because the trial court
had no jurisdiction to do so, having already ruled that the complaint shall be expunged.
After recognizing the jurisdiction of the trial court by seeking affirmative relief in their motion to serve supplemental pleading upon
private respondents, petitioners are effectively barred by estoppel from challenging the trial courts jurisdiction.[38] If a party invokes the
jurisdiction of a court, he cannot thereafter challenge the courts jurisdiction in the same case.[39] To rule otherwise would amount to
speculating on the fortune of litigation, which is against the policy of the Court.[40]
Nevertheless, there is a need to correct the erroneous impression of the trial court as well as the private respondents that
petitioners are barred from assailing the Order dated March 22, 1999 which reinstated the case because it was not objected to within the
reglementary period or even thereafter via a motion for reconsideration despite receipt thereof on March 26, 1999.
It must be clarified that the said order is but a resolution on an incidental matter which does not touch on the merits of the case or
put an end to the proceedings.[41] It is an interlocutory order since there leaves something else to be done by the trial court with respect
to the merits of the case.[42] As such, it is not subject to a reglementary period. Reglementary period refers to the period set by the rules
for appeal or further review of a final judgment or order, i.e., one that ends the litigation in the trial court.
Moreover, the remedy against an interlocutory order is generally not to resort forthwith to certiorari, but to continue with the case
in due course and, when an unfavorable verdict is handed down, to take an appeal in the manner authorized by law. [43] Only when the
court issued such order without or in excess of jurisdiction or with grave abuse of discretion and when the assailed interlocutory order is
patently erroneous and the remedy of appeal would not afford adequate and expeditious relief will certiorari be considered an
appropriate remedy to assail an interlocutory order.[44] Such special circumstances are absolutely wanting in the present case.
Time and again, the Court has held that the Manchester rule has been modified in Sun Insurance Office, Ltd. (SIOL) vs.
Asuncion[45] which defined the following guidelines involving the payment of docket fees:
 1. It is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee, be used for any other purpose,[60] such as to cure errors in proceedings or to correct erroneous conclusions of law or fact. [61] A contrary
that vests a trial court with jurisdiction over the subject-matter or nature of the action. Where the filing of the initiatory rule would lead to confusion, and seriously hamper the administration of justice.
pleading is not accompanied by payment of the docket fee, the court may allow payment of the fees within a reasonable Petitioners utterly failed to show that the trial court gravely abused its discretion in issuing the assailed resolutions. On the
time but in no case beyond the applicable prescriptive or reglementary period. contrary, it acted prudently, in accordance with law and jurisprudence.
2. The same rule applies to permissive counterclaims, third-party claims and similar pleadings, which shall not be considered WHEREFORE, the instant petition for certiorari is DISMISSED for lack of merit.
filed until and unless the filing fee prescribed therefor is paid. The court may also allow payment of said fee within a No costs.
reasonable time but also in no case beyond its applicable prescriptive or reglementary period. SO ORDERED.
3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and payment of the Puno, (Chairman), Callejo, Sr., Tinga and Chico-Nazario, JJ., concur.
prescribed filing fee but, subsequently, the judgment awards a claim not specified in the pleading, or if specified the
same has been left for determination by the court, the additional filing fee therefor shall constitute a lien on the
judgment. It shall be the responsibility of the Clerk of Court or his duly authorized deputy to enforce said lien and assess CAUSE OF ACTION (RULE 2, SECTION 1-6)
and collect the additional fee.
Plainly, while the payment of the prescribed docket fee is a jurisdictional requirement, even its non-payment at the time of filing JUANA COMPLEX I HOMEOWNERS ASSOCIATION, INC., ANDRES G.R. No. 152272
does not automatically cause the dismissal of the case, as long as the fee is paid within the applicable prescriptive or reglementary period, C. BAUTISTA, BRIGIDO DIMACULANGAN, DOLORES P. PRADO,
more so when the party involved demonstrates a willingness to abide by the rules prescribing such payment. [46] Thus, when insufficient IMELDA DE LA CRUZ, EDITHA C. DY, FLORENCIA M. MERCADO,
filing fees were initially paid by the plaintiffs and there was no intention to defraud the government, the Manchester rule does not LEOVINO C. DATARIO, AIDA
apply.[47] A. ABAYON, NAPOLEON M. DIMAANO, ROSITA G. ESTIGOY and
Under the peculiar circumstances of this case, the reinstatement of the complaint was just and proper considering that the cause of NELSON A. LOYOLA,
action of private respondents, being a real action, prescribes in thirty years,[48] and private respondents did not really intend to evade the Petitioners,
payment of the prescribed docket fee but simply contend that they could not be faulted for inadequate assessment because the clerk of
court made no notice of demand or reassessment.[49] They were in good faith and simply relied on the assessment of the clerk of court. - versus -
Furthermore, the fact that private respondents prayed for payment of damages in amounts justified by the evidence does not call
for the dismissal of the complaint for violation of SC Circular No. 7, dated March 24, 1988 which required that all complaints must specify FIL-ESTATE LAND, INC.,
the amount of damages sought not only in the body of the pleadings but also in the prayer in order to be accepted and admitted for FIL ESTATE ECOCENTRUM CORPORATION, LA PAZHOUSING AND
filing. Sun Insurance effectively modified SC Circular No. 7 by providing that filing fees for damages and awards that cannot be estimated DEVELOPMENT CORPORATION, WARBIRD SECURITY AGENCY,
constitute liens on the awards finally granted by the trial court.[50] ENRIQUE RIVILLA,
Thus, while the docket fees were based only on the real property valuation, the trial court acquired jurisdiction over the action, and MICHAEL E. JETHMAL
judgment awards which were left for determination by the court or as may be proven during trial would still be subject to additional filing and MICHAEL ALUNAN,
fees which shall constitute a lien on the judgment. It would then be the responsibility of the Clerk of Court of the trial court or his duly Respondents.
authorized deputy to enforce said lien and assess and collect the additional fees.[51] x-------------------------------------------x
It is worth noting that when Bertuldo filed his Answer on July 2, 1991, he did not raise the issue of lack of jurisdiction for non- FIL-ESTATE LAND, INC.,
payment of correct docket fees. Instead, he based his defense on a claim of ownership and participated in the proceedings before the trial FIL ESTATE ECOCENTRUM CORPORATION, LA PAZHOUSING AND
court. It was only in September 22, 1998 or more than seven years after filing the answer, and under the auspices of a new counsel, that DEVELOPMENT CORPORATION, WARBIRD SECURITY AGENCY,
the issue of jurisdiction was raised for the first time in the motion to expunge by Bertuldos heirs. ENRIQUE RIVILLA, MICHAEL E. JETHMAL and MICHAEL ALUNAN,
After Bertuldo vigorously participated in all stages of the case before the trial court and even invoked the trial courts authority in Petitioners,
order to ask for affirmative relief, petitioners, considering that they merely stepped into the shoes of their predecessor, are effectively
barred by estoppel from challenging the trial courts jurisdiction. Although the issue of jurisdiction may be raised at any stage of the - versus -
proceedings as the same is conferred by law, it is nonetheless settled that a party may be barred from raising it on ground of laches or JUANA COMPLEX I HOMEOWNERS ASSOCIATION, INC., ANDRES
estoppel.[52] C. BAUTISTA, BRIGIDO DIMACULANGAN, DOLORES P. PRADO, G. R. No. 152397
Moreover, no formal substitution of the parties was effected within thirty days from date of death of Bertuldo, as required by IMELDA DE LA CRUZ, EDITHA C. DY, FLORENCIA M.
Section 16, Rule 3[53] of the Rules of Court. Needless to stress, the purpose behind the rule on substitution is the protection of the right of MERCADO, LEOVINO C. DATARIO, AIDA Present:
every party to due process. It is to ensure that the deceased party would continue to be properly represented in the suit through the duly A. ABAYON, NAPOLEON M. DIMAANO, ROSITA G. ESTIGOY and
appointed legal representative of his estate.[54] Non-compliance with the rule on substitution would render the proceedings and judgment NELSON A. LOYOLA, VELASCO, JR., J., Chairperson,
of the trial court infirm because the court acquires no jurisdiction over the persons of the legal representatives or of the heirs on whom Respondents. PERALTA,
the trial and the judgment would be binding.[55] Thus, proper substitution of heirs must be effected for the trial court to acquire ABAD,
jurisdiction over their persons and to obviate any future claim by any heir that he was not apprised of the litigation against Bertuldo or MENDOZA, and
that he did not authorize Atty. Petalcorin to represent him. PERLAS-BERNABE, JJ.
The list of names and addresses of the heirs was submitted sixteen months after the death of Bertuldo and only when the trial
court directed Atty. Petalcorin to comply with the provisions of Section 16, Rule 3 of the Rules of Court. Strictly speaking therefore, before
said compliance, Atty. Petalcorin had no standing in the court a quo when he filed his pleadings. Be that as it may, the matter has been
duly corrected by the Order of the trial court dated October 15, 1999.
To be sure, certiorari under Rule 65[56] is a remedy narrow in scope and inflexible in character. It is not a general utility tool in the
legal workshop.[57] It offers only a limited form of review. Its principal function is to keep an inferior tribunal within its jurisdiction.[58] It can
be invoked only for an error of jurisdiction, that is, one where the act complained of was issued by the court, officer or a quasi-judicial
body without or in excess of jurisdiction, or with grave abuse of discretion which is tantamount to lack or in excess of jurisdiction,[59] not to

Promulgated:
March 5, 2012
X -------------------------------------------------------------------------------------- X
DECISION
MENDOZA, J.:
Before the Court are two (2) consolidated petitions assailing the July 31, 2001 Decision[1] and February 21, 2002 Resolution[2] of
the Court of Appeals (CA) in CA-G.R. SP No. 60543, which annulled and set aside the March 3, 1999 Order[3] of the Regional Trial Court,
Branch 25, Bian, Laguna (RTC), granting the application for the issuance of a writ of preliminary injunction, and upheld the June 16, 2000
Omnibus Order[4] denying the motion to dismiss.
The Facts:
On January 20, 1999, Juana Complex I Homeowners Association, Inc. (JCHA), together with individual residents of Juana
Complex I and other neighboring subdivisions (collectively referred as JCHA, et. al.), instituted a complaint[5] for damages, in its own behalf
and as a class suit representing the regular commuters and motorists of Juana Complex I and neighboring subdivisions who were deprived
of the use of La Paz Road, against Fil-Estate Land, Inc. (Fil-Estate), Fil-estate Ecocentrum Corporation (FEEC), La Paz Housing &
Development Corporation (La Paz), and Warbird Security Agency and their respective officers (collectively referred as Fil-Estate, et al.).
The complaint alleged that JCHA, et al. were regular commuters and motorists who constantly travelled towards the direction
of Manila and Calamba; that they used the entry and exit toll gates of South Luzon Expressway (SLEX) by passing through right-of-way
public road known as La Paz Road; that they had been using La Paz Road for more than ten (10) years; that in August 1998, Fil-estate
excavated, broke and deliberately ruined La Paz Road that led to SLEX so JCHA, et al. would not be able to pass through the said road; that
La Paz Road was restored by the residents to make it passable but Fil-estate excavated the road again; that JCHA reported the matter to
the Municipal Government and the Office of the Municipal Engineer but the latter failed to repair the road to make it passable and safe to
motorists and pedestrians; that the act of Fil-estate in excavating La Paz Road caused damage, prejudice, inconvenience, annoyance, and
loss of precious hours to them, to the commuters and motorists because traffic was re-routed to narrow streets that caused terrible
traffic congestion and hazard; and that its permanent closure would not only prejudice their right to free and unhampered use of the
property but would also cause great damage and irreparable injury.
Accordingly, JCHA, et al. also prayed for the immediate issuance of a Temporary Restraining Order (TRO) or a writ of
preliminary injunction (WPI) to enjoin Fil-Estate, et al. from stopping and intimidating them in their use of La Paz Road.
On February 10, 1999, a TRO was issued ordering Fil-Estate, et al, for a period of twenty (20) days, to stop preventing, coercing,
intimidating or harassing the commuters and motorists from using the La Paz Road. [6]
Subsequently, the RTC conducted several hearings to determine the propriety of the issuance of a WPI.
On February 26, 1999, Fil-Estate, et al. filed a motion to dismiss[7] arguing that the complaint failed to state a cause of action
and that it was improperly filed as a class suit. On March 5, 1999, JCHA, et al. filed their comment[8] on the motion to dismiss to which
respondents filed a reply.[9]
On March 3, 1999, the RTC issued an Order [10] granting the WPI and required JCHA, et al. to post a bond.
On March 19, 1999, Fil-Estate, et al. filed a motion for reconsideration[11] arguing, among others, that JCHA, et al. failed to
satisfy the requirements for the issuance of a WPI. On March 23, 1999, JCHA, et al. filed their opposition to the motion.[12]
The RTC then issued its June 16, 2000 Omnibus Order, denying both the motion to dismiss and the motion for reconsideration
filed by Fil-Estate, et al.
Not satisfied, Fil-Estate, et al. filed a petition for certiorari and prohibition before the CA to annul (1) the Order dated March 3,
1999 and (2) the Omnibus Order dated June 16, 2000. They contended that the complaint failed to state a cause of action and that it was
improperly filed as a class suit. With regard to the issuance of the WPI, the defendants averred that JCHA, et al. failed to show that they
had a clear and unmistakable right to the use of La Paz Road; and further claimed that La Paz Road was a torrens registered private road
and there was neither a voluntary nor legal easement constituted over it.[13]
On July 31, 2001, the CA rendered the decision partially granting the petition, the dispositive portion of which reads:
WHEREFORE, the petition is hereby partially GRANTED. The Order dated March 3, 1999 granting the writ
of preliminary injunction is hereby ANNULLED and SET ASIDE but the portion of the Omnibus Order dated June 16,
2000 denying the motion to dismiss is upheld.
SO ORDERED.[14]
The CA ruled that the complaint sufficiently stated a cause of action when JCHA, et al. alleged in their complaint that they had
been using La Paz Road for more than ten (10) years and that their right was violated when Fil-Estate closed and excavated the road. It
sustained the RTC ruling that the complaint was properly filed as a class suit as it was shown that the case was of common interest and
that the individuals sought to be represented were so numerous that it was impractical to include all of them as parties. The CA, however,
annulled the WPI for failure of JCHA, et al. to prove their clear and present right over La Paz Road. The CA ordered the remand of the case
to the RTC for a full-blown trial on the merits.
Hence, these petitions for review.
In G.R. No. 152272, JCHA, et al. come to this Court, raising the following issues:
(A)
THE HONORABLE COURT OF APPEALS, IN HOLDING THAT A FULL-BLOWN TRIAL ON THE MERITS IS
REQUIRED TO DETERMINE THE NATURE OF THE LA PAZ ROAD, HAD DEPARTED FROM THE ACCEPTED AND USUAL
COURSE OF JUDICIAL PROCEEDINGS AS TO CALL FOR AN EXERCISE OF THE POWER OF SUPERVISION.
(B)
THE HONORABLE COURT OF APPEALS, IN HOLDING THAT THE PETITIONERS FAILED TO SATISFY THE
REQUIREMENTS FOR THE ISSUANCE OF A WRIT OF PRELIMINARY INJUNCTION, HAD DECIDED NOT IN ACCORD
WITH LAW AND WITH THE APPLICABLE DECISIONS OF THE SUPREME COURT.[15]
In G.R. No. 152397, on the other hand, Fil-Estate, et al. anchor their petition on the following issues:
I.
The Court of Appeals declaration that respondents Complaint states a cause of action is contrary to existing law
and jurisprudence.
II.
The Court of Appeals pronouncement that respondents complaint was properly filed as a class suit is contrary to
existing law and jurisprudence.
III.
The Court of Appeals conclusion that full blown trial on the merits is required to determine the nature of the La
Paz Road is contrary to existing laws and jurisprudence.[16]
 JCHA, et al. concur with the CA that the complaint sufficiently stated a cause of action. They, however, disagree with the CAs
pronouncement that a full-blown trial on the merits was necessary. They claim that during the hearing on the application of the writ of
injunction, they had sufficiently proven that La Paz Road was a public road and that commuters and motorists of their neighboring villages
had used this road as their means of access to the San Agustin Church, Colegio De San Agustin and to SLEX in going to Metro Manila and
to Southern Tagalog particularly during the rush hours when traffic at Carmona Entry/Exit and Susana Heights Entry/Exit was at its worst.
JCHA, et al. argue that La Paz Road has attained the status and character of a public road or burdened by an apparent
easement of public right of way. They point out that La Paz Road is the widest road in the neighborhood used by motorists in going
to Halang Road and in entering the SLEX-Halang toll gate and that there is no other road as wide as La Paz Road existing in the vicinity. For
residents of San Pedro, Laguna, the shortest, convenient and safe route towards SLEX Halang is along Rosario Avenue joining La Paz Road.
Finally, JCHA, et al. argue that the CA erred when it voided the WPI because the public nature of La Paz Road had been
sufficiently proven and, as residents of San Pedro and Bian, Laguna, their right to use La Paz Road is undeniable.
In their Memorandum,[17] Fil-Estate, et al. explain that La Paz Road is included in the parcels of land covered by Transfer
Certificates of Title (TCT) Nos. T-120008, T-90321 and T-90607, all registered in the name of La Paz. The purpose of constructing La Paz
Road was to provide a passageway for La Paz to its intended projects to the south, one of which was the Juana Complex I. When Juana
Complex I was completed, La Paz donated the open spaces, drainage, canal, and lighting facilities inside the Juana Complex I to the
Municipality of Bian. The streets within the subdivisions were then converted to public roads and were opened for use of the general
public. The La Paz Road, not being part of the Juana Complex I, was excluded from the donation. Subsequently, La Paz became a
shareholder of FEEC, a consortium formed to develop several real properties in Bian, Laguna, known as Ecocentrum Project. In exchange
for shares of stock, La Paz contributed some of its real properties to the Municipality of Bian, including the properties constituting La Paz
Road, to form part of the Ecocentrum Project.
Fil-Estate, et al. agree with the CA that the annulment of the WPI was proper since JCHA, et al. failed to prove that they have a
clear right over La Paz Road. Fil-Estate, et al. assert that JCHA, et al. failed to prove the existence of a right of way or a right to pass over La
Paz Road and that the closure of the said road constituted an injury to such right. According to them, La Paz Road is a torrens registered
private road and there is neither a voluntary nor legal easement constituted over it. They claim that La Paz Road is a private property
registered under the name of La Paz and the beneficial ownership thereof was transferred to FEEC when La Paz joined the consortium for
the Ecocentrum Project.
Fil-Estate, et al., however, insist that the complaint did not sufficiently contain the ultimate facts to show a cause of action.
They aver the bare allegation that one is entitled to something is an allegation of a conclusion which adds nothing to the pleading.
They likewise argue that the complaint was improperly filed as a class suit for it failed to show that JCHA, et al. and the commuters
and motorists they are representing have a well-defined community of interest over La Paz Road. They claim that the excavation of La Paz Road would not
necessarily give rise to a common right or cause of action for JCHA, et al. against them since each of them has a separate and distinct purpose and each may
be affected differently than the others.
The Courts Ruling
The issues for the Courts resolution are: (1) whether or not the complaint states a cause of action; (2) whether the complaint has been
properly filed as a class suit; and (2) whether or not a WPI is warranted.
Section 2, Rule 2 of the Rules of Court defines a cause of action as an act or omission by which a party violates the right of
another. A complaint states a cause of action when it contains three (3) essential elements of a cause of action, namely:
(1) the legal right of the plaintiff,
(2) the correlative obligation of the defendant, and
(3) the act or omission of the defendant in violation of said legal right.[18]
The question of whether the complaint states a cause of action is determined by its averments regarding the acts committed
by the defendant.[19] Thus, it must contain a concise statement of the ultimate or essential facts constituting the plaintiffs cause of
action.[20] To be taken into account are only the material allegations in the complaint; extraneous facts and circumstances or other
matters aliunde are not considered.[21]
The test of sufficiency of facts alleged in the complaint as constituting a cause of action is whether or not admitting the facts
alleged, the court could render a valid verdict in accordance with the prayer of said complaint.[22] Stated differently, if the allegations in
the complaint furnish sufficient basis by which the complaint can be maintained, the same should not be dismissed regardless of the
defense that may be asserted by the defendant.[23]
In the present case, the Court finds the allegations in the complaint sufficient to establish a cause of action. First, JCHA, et al.s
averments in the complaint show a demandable right over La Paz Road. These are: (1) their right to use the road on the basis of their
allegation that they had been using the road for more than 10 years; and (2) an easement of a right of way has been constituted over the
said roads. There is no other road as wide as La Paz Road existing in the vicinity and it is the shortest, convenient and safe route towards
SLEX Halang that the commuters and motorists may use. Second, there is an alleged violation of such right committed by Fil-Estate, et al.
when they excavated the road and prevented the commuters and motorists from using the same. Third, JCHA, et al. consequently
suffered injury and that a valid judgment could have been rendered in accordance with the relief sought therein.
With respect to the issue that the case was improperly instituted as a class suit, the Court finds the opposition without merit.
Section 12, Rule 3 of the Rules of Court defines a class suit, as follows:
Sec. 12. Class suit. When the subject matter of the controversy is one of common or general interest to
many persons so numerous that it is impracticable to join all as parties, a number of them which the court finds to
be sufficiently numerous and representative as to fully protect the interests of all concerned may sue or defend for
the benefit of all. Any party in interest shall have the right to intervene to protect his individual interest.
The necessary elements for the maintenance of a class suit are: 1) the subject matter of controversy is one of common or
general interest to many persons; 2) the parties affected are so numerous that it is impracticable to bring them all to court; and 3) the
parties bringing the class suit are sufficiently numerous or representative of the class and can fully protect the interests of all
concerned.[24]
In this case, the suit is clearly one that benefits all commuters and motorists who use La Paz Road. As succinctly stated by the
CA:
The subject matter of the instant case, i.e., the closure and excavation of the La Paz Road, is initially
shown to be of common or general interest to many persons. The records reveal that numerous individuals have
filed manifestations with the lower court, conveying their intention to join private respondents in the suit and
claiming that they are similarly situated with private respondents for they were also prejudiced by the acts of
petitioners in closing and excavating the La Paz Road. Moreover, the individuals sought to be represented by private
respondents in the suit are so numerous that it is impracticable to join them all as parties and be named individually
as plaintiffs in the complaint. These individuals claim to be residents of various barangays in Bian, Laguna and other
barangays in San Pedro, Laguna.
Anent the issue on the propriety of the WPI, Section 3, Rule 58 of the Rules of Court lays down the rules for the issuance
thereof. Thus:
(a) That the applicant is entitled to the relief demanded, and the whole or part of such relief consists in restraining the
commission or continuance of the acts complained of, or in the performance of an act or acts, either for a limited period or
perpetually;
(b) That the commission, continuance or non-performance of the act or acts complained of during the litigation would
probably work injustice to the applicant; or
(c) That a party, court, or agency or a person is doing, threatening, or attempting to do, or is procuring or suffering to be
done, some act or acts probably in violation of the rights of the applicant respecting the subject of the action or proceeding, and
tending to render the judgment ineffectual.
A writ of preliminary injunction is available to prevent a threatened or continuous irremediable injury to parties before their claims can be
thoroughly studied and adjudicated.[25] The requisites for its issuance are: (1) the existence of a clear and unmistakable right that must be protected; and (2)
an urgent and paramount necessity for the writ to prevent serious damage.[26]For the writ to issue, the right sought to be protected must be a present right, a
legal right which must be shown to be clear and positive.[27] This means that the persons applying for the writ must show that they have an
ostensible right to the final relief prayed for in their complaint.[28]
 In the case at bench, JCHA, et al. failed to establish a prima facie proof of violation of their right to justify the issuance of a WPI. Their right to the
use of La Paz Road is disputable since they have no clear legal right therein. As correctly ruled by the CA:
Here, contrary to the ruling of respondent Judge, private respondents failed to prove as yet that they have a clear and
unmistakable right over the La Paz Road which was sought to be protected by the injunctive writ. They merely anchor their
purported right over the La Paz Road on the bare allegation that they have been using the same as public road right-of-way for more
than ten years. A mere allegation does not meet the standard of proof that would warrant the issuance of the injunctive writ.
Failure to establish the existence of a clear right which should be judicially protected through the writ of injunction is a sufficient
ground for denying the injunction.
Consequently, the case should be further heard by the RTC so that the parties can fully prove their respective positions on the issues.
Due process considerations dictate that the assailed injunctive writ is not a judgment on the merits but merely an order for the
grant of a provisional and ancillary remedy to preserve the status quo until the merits of the case can be heard. The hearing on the
application for issuance of a writ of preliminary injunction is separate and distinct from the trial on the merits of the main case. [29] The
evidence submitted during the hearing of the incident is not conclusive or complete for only a "sampling" is needed to give the trial court
an idea of the justification for the preliminary injunction pending the decision of the case on the merits.[30] There are vital facts that have
yet to be presented during the trial which may not be obtained or presented during the hearing on the application for the injunctive
writ.[31] Moreover, the quantum of evidence required for one is different from that for the other.[32]
DECISION
CARPIO MORALES, J.:
The Regional Trial Court (RTC) of Makati City, Branch 65 (sic)[2] having, by Decision[3] of July 10, 2001, dismissed petitioners
complaint in Civil Case No. 00-540 on the ground of res judicata and splitting of a cause of action, and by Order of September 24,
2001[4] denied their motion for reconsideration thereof, petitioners filed the present petition for review on certiorari.
From the rather lengthy history of the present controversy, a recital of the following material facts culled from the records is in
order.
On May 21, 1974, petitioner Davao Timber Corporation (DATICOR) and respondent Private Development Corporation of the Philippines
(PDCP) entered into a loan agreement under which PDCP extended to DATICOR a foreign currency loan of US $265,000 and a peso loan
of P2.5 million or a total amount of approximately P4.4 million, computed at the then prevailing rate of exchange of the dollar with the
peso.
The loan agreement provided, among other things, that DATICOR shall pay: (1) a service fee of one percent (1%) per annum (later
increased to six percent [6%] per annum) on the outstanding balance of the peso loan; (2) 12 percent (12%) per annum interest on the
peso loan; and (3) penalty charges of two percent (2%) per month in case of default.

WHEREFORE, the petitions are DENIED. Accordingly, the July 31, 2001 Decision and February 21, 2002 Resolution of the Court The loans were secured by real estate mortgages over six parcels of land one situated in Manila (the Otis property) which was
of Appeals in CA-G.R. SP No. 60543 are AFFIRMED. registered in the name of petitioner Ernesto C. Del Rosario, and five in Mati, Davao Oriental and chattel mortgages over pieces of
machinery and equipment.
SO ORDERED.
Petitioners paid a total of P3 million to PDCP, which the latter applied to interest, service fees and penalty charges. This left
petitioners, by PDCPs computation, with an outstanding balance on the principal of more than P10 million as of May 15, 1983.

JOSE CATRAL MENDOZA By March 31, 1982, petitioners had filed a complaint against PDCP before the then Court of First Instance (CFI) of Manila for
Associate Justice violation of the Usury Law, annulment of contract and damages. The case, docketed as Civil Case No. 82-8088, was dismissed by the CFI.
WE CONCUR:

On appeal, the then Intermediate Appellate Court (IAC) set aside the CFIs dismissal of the complaint and declared void and of
no effect the stipulation of interest in the loan agreement between DATICOR and PDCP.

PRESBITERO J. VELASCO, JR. PDCP appealed the IACs decision to this Court where it was docketed as G.R. No. 73198.
Associate Justice
Chairperson In the interim, PDCP assigned a portion of its receivables from petitioners (the receivables) to its co-respondent Far East Bank
and Trust Company (FEBTC) under a Deed of Assignment dated April 10, 1987[5] for a consideration of P5,435,000. The Deed of
Assignment was later amended by two Supplements.[6]
ERNESTO C. DEL ROSARIO andDAVAO TIMBER CORPORATION, G.R. No. 150134
Petitioners, FEBTC, as assignee of the receivables, and petitioners later executed a Memorandum of Agreement (MOA) dated December 8,
Present: 1988 whereby petitioners agreed to, as they did pay FEBTC[7] the amount of P6.4 million as full settlement of the receivables.

QUISUMBING, J., Chairperson, On September 2, 1992, this Court promulgated its Decision in G.R. No. 73198[8] affirming in toto the decision of the IAC. It determined that
- versus - CARPIO, after deducting the P3 million earlier paid by petitioners to PDCP, their remaining balance on the principal loan was only P1.4 million.
CARPIO MORALES,
TINGA, and Petitioners thus filed on April 25, 1994 a Complaint[9] for sum of money against PDCP and FEBTC before the RTC of Makati,
VELASCO, JR., JJ. mainly to recover the excess payment which they computed to be P5.3 million[10] P4.335 million from PDCP, and P965,000 from
FAR EAST BANK & TRUST COMPANY[1] and FEBTC. The case, Civil Case No. 94-1610, was raffled to Branch 132 of the MakatiRTC.
PRIVATEDEVELOPMENTCORPORATION
OF THE PHILIPPINES, PROMULGATED: On May 31, 1995, Branch 132 of the Makati RTC rendered a decision[11] in Civil Case No. 94-1610 ordering PDCP to pay
Respondents. petitioners the sum of P4.035 million,[12] to bear interest at 12% per annum from April 25, 1994 until fully paid; to execute a release or
October 31, 2007 cancellation of the mortgages on the five parcels of land in Mati, Davao Oriental and on the pieces of machinery and equipment and to
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x return the corresponding titles to petitioners; and to pay the costs of the suit.

As for the complaint of petitioners against respondent FEBTC, the trial court dismissed it for lack of cause of action, ratiocinating that the
MOA between petitioners and FEBTC was not subject to this Courts Decision in G.R. No. 73198, FEBTC not being a party thereto.
From the trial courts decision, petitioners and respondent PDCP appealed to the Court of Appeals (CA). The appeal was docketed as CA-
G.R. CV No. 50591.
On May 22, 1998, the CA rendered a decision[13] in CA-G.R. CV No. 50591, holding that petitioners outstanding obligation,
which this Court had determined in G.R. No. 73198 to be P1.4 million, could not be increased or decreased by any act of the creditor
PDCP.
The CA held that when PDCP assigned its receivables, the amount payable to it by DATICOR was the same amount payable to
assignee FEBTC, irrespective of any stipulation that PDCP and FEBTC might have
provided in the Deed of Assignment, DATICOR not having been a party thereto, hence, not bound by its terms.
Citing Articles 2154[14] and 2163[15] of the Civil Code which embody the principle of solutio indebiti, the CA held that the party
bound to refund the excess payment of P5 million[16] was FEBTC as it received the overpayment; and that FEBTC could recover from PDCP
the amount of P4.035 million representing its overpayment for the assigned receivables based on the terms of the Deed of Assignment or
on the general principle of equity.
Noting, however, that DATICOR claimed in its complaint only the amount of P965,000 from FEBTC, the CA held that it could not
grant a relief different from or in excess of that prayed for.
Finally, the CA held that the claim of PDCP against DATICOR for the payment of P1.4 million had no basis, DATICORs obligation
having already been paid in full, overpaid in fact, when it paid assignee FEBTC the amount of P6.4 million.
Accordingly, the CA ordered PDCP to execute a release or cancellation of the mortgages it was holding over the Mati real
properties and the machinery and equipment, and to return the corresponding certificates of title to petitioners. And it ordered FEBTC to
pay petitioners the amount of P965,000 with legal interest from the date of the promulgation of its judgment.
FEBTCs motion for reconsideration of the CA Decision was denied, and so was its subsequent appeal to this Court.
On April 25, 2000, petitioners filed before the RTC of Makati a Complaint[17] against FEBTC to recover the balance of the excess
payment of P4.335 million.[18] The case was docketed as Civil Case No. 00-540, the precursor of the present case and raffled to Branch 143
of the RTC.
In its Answer,[19] FEBTC denied responsibility, it submitting that nowhere in the dispositive portion of the CA Decision in CA-G.R.
CV No. 50591 was it held liable to return the whole amount of P5.435 million representing the consideration for the assignment to it of
the receivables, and since petitioners failed to claim the said whole amount in their original complaint in Civil Case No. 94-1610 as they
were merely claiming the amount of P965,000 from it, they were barred from claiming it.
FEBTC later filed a Third Party Complaint[20] against PDCP praying that the latter be made to pay the P965,000 and the interests
adjudged by the CA in favor of petitioners, as well as the P4.335 million and interests that petitioners were claiming from it. It posited that
PDCP should be held liable because it received a consideration of P5.435 million when it assigned the receivables.
Answering[21] the Third Party Complaint, PDCP contended that since petitioners were not seeking the recovery of the amount
of P965,000, the same cannot be recovered via the third party complaint.
PDCP went on to contend that since the final and executory decision in CA-G.R. CV No. 50591 had held that DATICOR has no
cause of action
against it for the refund of any part of the excess payment, FEBTC can no longer re-litigate the same issue.
Moreover, PDCP contended that it was not privy to the MOA which explicitly excluded the receivables from the effect of the
Supreme Court decision, and that the amount of P6.4 million paid by petitioners to FEBTC was clearly intended as consideration for the
release and cancellation of the lien on the Otis property.
Replying,[22] FEBTC pointed out that PDCP cannot deny that it benefited from the assignment of its rights over the receivables from
petitioners. It added that the third party claim being founded on a valid and justified cause, PDCPs counterclaims lacked factual and legal
basis.
Petitioners thereafter filed a Motion for Summary Judgment[23] to which FEBTC filed its opposition.[24]
By Order of March 5, 2001, the trial court denied the motion for summary judgment for lack of merit.[25]
On July 10, 2001, the trial court issued the assailed Decision dismissing petitioners complaint on the ground of res judicata and
splitting of cause of action. It recalled that petitioners had filed Civil Case No. 94-1610 to recover the alleged overpayment both from
PDCP and FEBTC and to secure the cancellation and release of their mortgages on real properties, machinery and equipment; that when
said case was appealed, the CA, in its Decision, ordered PDCP to release and cancel the mortgages and FEBTC to pay P965,000 with
interest, which Decision became final and executory on November 23, 1999; and that a Notice of Satisfaction of Judgment between
petitioners and FEBTC was in fact submitted on August 8, 2000, hence, the issue between them was finally settled under the doctrine
of res judicata.
The trial court moreover noted that the MOA between petitioners and FEBTC clearly stated that the pending litigation before
the Supreme Court of the Philippines with respect to the Loan exclusive of the Receivables assigned to FEBTC shall prevail up to the extent
not covered by this Agreement. That statement in the MOA, the trial court ruled, categorically made only the loan subject to this Courts
Decision in G.R. No. 73198, hence, it was with the parties full knowledge and consent that petitioners agreed to pay P6.4 million to FEBTC
as consideration for the settlement. The parties cannot thus be allowed to welsh on their contractual obligations, the trial court
concluded.
Respecting the third party claim of FEBTC, the trial court held that FEBTCs payment of the amount of P1,224,906.67 (P965,000
plus interest) to petitioners was in compliance with the final judgment of the CA, hence, it could not entertain such claim because the
Complaint filed by petitioners merely sought to recover from FEBTC the alleged overpayment of P4.335 million and attorneys fees
of P200,000.
Petitioners motion for reconsideration[26] of the July 10, 2001 decision of the trial court was denied by Order of September 24,
2001.
Hence, the present petition.
In their Memorandum,[27] petitioners proffer that, aside from the issue of whether their complaint is dismissible on the ground
of res judicata and splitting of cause of action, the issues of 1) whether FEBTC can be held liable for the balance of the overpayment
of P4.335 million plus interest
which petitioners previously claimed against PDCP in Civil Case No. 94-1610, and 2) whether PDCP can interpose as defense the provision
in the Deed of Assignment and the MOA that the assignment of the receivables shall not be affected by this Courts Decision in G.R. No.
73198, be considered.
Stripped of the verbiage, the only issue for this Courts consideration is the propriety of the dismissal of Civil Case No. 00-540
upon the grounds stated by the trial court.This should be so because a Rule 45 petition, like the one at bar, can raise only questions of law
(and that justifies petitioners elevation of the case from the trial court directly to this Court) which must be distinctly set forth.[28]
The petition is bereft of merit.
Section 47 of Rule 39 of the Rules of Court, on the doctrine of res judicata, reads:
Sec. 47. Effect of judgments or final orders. The effect of a judgment or final order rendered by a court of
the Philippines, having jurisdiction to pronounce the judgment or final order, may be as follows:
 xxxx
(b) In other cases, the judgment or final order is, with respect to the matter directly adjudged or as to
any other matter that could have been raised in relation thereto, conclusive between the parties and their
successors in interest by title subsequent to the commencement of the action or special proceeding, litigating for
the same thing and under the same title and in the same capacity; and
(c) In any other litigation between the same parties or their successors in interest, that only is deemed to
have been adjudged in a former judgment or final order which appears upon its face to have been so adjudged, or
which was actually and necessarily included therein or necessary thereto. (Underscoring supplied)
The above-quoted provision lays down two main rules. Section 49(b) enunciates the first rule of res judicata known as bar by
prior judgment or estoppel by judgment, which states that the judgment or decree of a court of competent jurisdiction on the merits
concludes the parties and their privies to the litigation and constitutes a bar to a new action or suit involving the same cause of action
either before the same or any other tribunal.[29]
Stated otherwise, bar by former judgment makes the judgment rendered in the first case an absolute bar to the subsequent
action since that judgment is conclusive not only as to the matters offered and received to sustain it but also as to any other matter which
might have been offered for that purpose and which could have been adjudged therein.[30] It is in this concept that the term res judicata is
more commonly and generally used as a ground for a motion to dismiss in civil cases.[31]
The second rule of res judicata embodied in Section 47(c), Rule 39 is conclusiveness of judgment. This rule provides that any
right, fact, or matter in issue directly adjudicated or necessarily involved in the determination of an action before a competent court in
which a judgment or decree is rendered on the merits is conclusively settled by the judgment therein and cannot again be litigated
between the parties and their privies whether or not the claim or demand, purpose, or subject matter of the two suits is the same.[32] It
refers to a situation where the judgment in the prior
action operates as an estoppel only as to the matters actually determined or which were necessarily included therein.[33]
The case at bar satisfies the four essential requisites of bar by prior judgment, viz:
(a) finality of the former judgment;
(b) the court which rendered it had jurisdiction over the subject matter and the parties;
(c) it must be a judgment on the merits; and
(d) there must be, between the first and second actions, identity of parties, subject matter and causes of
action.[34]
There is no doubt that the judgment on appeal relative to Civil Case No. 94-1610 (that rendered in CA-G.R. CV No. 50591) was a
final judgment. Not only did it dispose of the case on the merits; it also became executory as a consequence of the denial of FEBTCs
motion for reconsideration and appeal.[35]
Neither is there room to doubt that the judgment in Civil Case No. 94-1610 was on the merits for it determined the rights and
liabilities of the parties.[36] To recall, it was ruled that: (1) DATICOR overpaid by P5.3 million; (2) FEBTC was bound to refund the excess
payment but because DATICORs claim against FEBTC was only P965,000, the court could only grant so much as the relief prayed for; and
(3) PDCP has no further claim against DATICOR because its obligation had already been paid in full.
Right or wrong, that judgment bars another case based upon the same cause of action.[37]
As to the requisite of identity of parties, subject matter and causes of action, it cannot be gainsaid that the first case, Civil Case
No. 94-1610, was brought by petitioners to recover an alleged overpayment of P5.3 million P965,000 from FEBTC and P4.335 million from
PDCP.
On the other hand, Civil Case No. 00-540, filed by the same petitioners, was for the recovery of P4.335 million which is
admittedly part of the P5.3 million earlier sought to be recovered in Civil Case No. 94-1610. This time, the action was brought solely
against FEBTC which in turn impleaded PDCP as a third party defendant.
In determining whether causes of action are identical to warrant the application of the rule of res judicata, the test is to
ascertain whether the same evidence which is necessary to sustain the second action would suffice to authorize a recovery in the first
even in cases in which the forms or nature of the two actions are different.[38] Simply stated, if the same facts or evidence would sustain
both, the two actions are considered the same within the rule that the judgment in the former is a bar to the subsequent action.
It bears remembering that a cause of action is the delict or the wrongful act or omission committed by the defendant in
violation of the primary rights of the plaintiff.[39]
In the two cases, petitioners imputed to FEBTC the same alleged wrongful act of mistakenly receiving and refusing to return an
amount in excess of what was due it in violation of their right to a refund. The same facts and evidence presented in the first case, Civil
Case No. 94-1610, were the very same facts and evidence that petitioners presented in Civil Case No. 00-540.
Thus, the same Deed of Assignment between PDCP and FEBTC, the first and second supplements to the Deed, the MOA
between petitioners and FEBTC, and this Courts Decision in G.R. No. 73198 were submitted in Civil Case No. 00-540.
Notably, the same facts were also pleaded by the parties in support of their allegations for, and defenses against, the recovery
of the P4.335 million. Petitioners, of course, plead the CA Decision as basis for their subsequent claim for the remainder of their
overpayment. It is well established, however, that a party cannot, by varying the form of action or adopting a different method of
presenting his case, or by pleading justifiable circumstances as herein petitioners are doing, escape the operation of the principle that one
and the same cause of action shall not be twice litigated.[40]
In fact, authorities tend to widen rather than restrict the doctrine of res judicata on the ground that public as well as private
interest demands the ending of suits by requiring the parties to sue once and for all in the same case all the special proceedings and
remedies to which they are entitled.[41]
This Court finds well-taken then the pronouncement of the court a quo that to allow the re-litigation of an issue that was finally
settled as between petitioners and FEBTC in the prior case is to allow the splitting of a cause of action, a ground for dismissal under
Section 4 of Rule 2 of the Rules of Court reading:
SEC. 4. Splitting of a single cause of action; effect of. If two or more suits are instituted on the basis of the
same cause of action, the filing of one or a judgment upon the merits in any one is available as a ground for the
dismissal of the others. (Emphasis and underscoring supplied)
This rule proscribes a party from dividing a single or indivisible cause of action into several parts or claims and instituting two or more
actions based on it.[42] Because the plaintiff cannot divide the grounds for recovery, he is mandated to set forth in his first action every
ground for relief which he claims to exist and upon which he relies; he cannot be permitted to rely upon them by piecemeal in successive
actions to recover for the same wrong or injury.[43]
Clearly then, the judgment in Civil Case No. 94-1610 operated as a bar to Civil Case No. 00-540, following the above-quoted
Section 4, Rule 2 of the Rules of Court.
A final word. Petitioners are sternly reminded that both the rules on res judicata and splitting of causes of action are based on the salutary
public policy against unnecessary multiplicity of suits interest reipublicae ut sit finis litium.[44] Re-litigation of matters already settled by a
courts final judgment merely burdens the courts and the taxpayers, creates uneasiness and confusion, and wastes valuable time and
energy that could be devoted to worthier cases.[45]
 WHEREFORE, the Petition is DENIED. The assailed Decision of the RTC, Branch 143, Makati dismissing petitioners complaint in any such cases, LESSEE hereby irrevocably appoints LESSOR, its authorized agents, employees and/or representatives as his duly
Civil Case No. 00-540 is AFFIRMED. authorized attorney-in-fact, even after the termination, expiration or cancellationof this Contract, with full power and authority to open,
enter, repossess, secure, enclose, fence and otherwise take full and complete physical possession and control of the leased premises and
its contents without resorting to court action and/or to summarily disconnect electrical and/or water services thereof, and that LESSEE
hereby irrevocably empowers LESSOR, his authorized agents, employees and/or representatives to take inventory and possession of
Costs against petitioners. whatever equipment, furniture, articles, merchandise, appliances, etc., found therein belonging to LESSEE, consignors and/or to any other
persons and to place the same in LESSORs warehouse or any other place at LESSORs discretion for safekeeping; charging LESSEE the
SO ORDERED. corresponding storage fees therefor; that in case LESSEE fails to claim said equipment, furniture, articles, merchandise, appliances, etc.
from storage and simultaneously liquidate any liability with LESSOR within seven (7) days from date of said transfer to LESSORs
warehouse, LESSOR is likewise hereby expressly authorized and empowered by LESSEE to dispose of said property/properties in a public
sale through a Notary Public of LESSORs choice and to apply the proceeds thereof to whatever liability and/or indebtedness LESSEE may
CONCHITA CARPIO MORALES have to LESSOR plus reasonable expenses for the same, including storage fees, and the balance, if any, shall be turned over to LESSEE; that
Associate Justice LESSEE hereby expressly agrees that any or all acts performed by LESSOR, his authorized agents, employees and/or representatives under
the provisions of this Section may not be the subject of any petition for a Writ of Preliminary Injunction or Mandatory Injunction in court,
and that LESSOR and/or his authorized agents, employees, and/or representatives shall be free from any civil and/or criminal liability or
WE CONCUR: responsibility whatsoever therefor.
TERMINATION OF LEASE
26. Upon the automatic termination of this lease contract, as the case may be, LESSEE shall immediately vacate and redeliver physical
possession of the leased premises, including the keys appertaining thereto, to LESSOR in good, clean and sanitary condition, reasonable
LEONARDO A. QUISUMBING wear and tear excepted, devoid of all occupants, equipment, furniture, articles, merchandise, etc., belonging to LESSEE or to any other
Associate Justice person except those belonging to LESSOR; that should LESSEE fail to comply with this provision, LESSOR is hereby given the same rights
Chairperson and power to proceed against LESSEE as expressly granted in the immediately preceding section.
Private respondent failed to pay rentals despite several demands by petitioner. As of 19 October 1992 the arrearages amounted
to P8,608,284.66. Admittedly, non-payment of rentals constituted breach of their contract; thus, pursuant to the express authority
granted petitioner under the above-quoted Secs. 25 and 26 of the lease agreement, petitioner on 31 October 1992 repossessed the leased
premises, inventoried the movable properties found within and owned by private respondent and scheduled public auction for the sale of
ANTONIO T. CARPIO DANTE O. TINGA the movables on 19 August 1993 with notice to private respondent.
Associate Justice Associate Justice On 26 November 1992 private respondent filed with the Metropolitan Trial Court of Quezon City a complaint against petitioner for
forcible entry with damages and a prayer for a temporary restraining order and/or writ of preliminary injunction.[2] The case was raffled
to Branch 40 presided over by Judge Guillermo L. Loja Jr. who issued a temporary restraining order enjoining petitioner from selling
private respondents properties at a public auction.
On 9 December 1992 Judge Loja inhibited himself from trying the case and directed its transfer to Branch 34 presided over by Judge
Joselito SD Generoso. Soon after, petitioner filed an urgent motion for the inhibition of Judge Generoso and the immediate reraffle of the
PRESBITERO J. VELASCO, JR. case arguing that the summary transfer of the case to Judge Generoso was irregular as it was not done by raffle.
Associate Justice The motion was granted and the case went to Branch 36 presided over by Judge Francisco D. Villanueva. Thereafter, on 22
PROGRESSIVE DEVELOPMENT CORPORATION, INC., petitioner, vs. COURT OF APPEALS and WESTIN SEAFOOD MARKET, December 1992, at the continuation of the hearing on the issuance of a writ preliminary mandatory injunction, the parties agreed, among
INC., respondents. others, on the following: (a) private respondent would deposit with the Philippine Commercial and Industrial Bank in the name of
DECISION theMetropolitan Trial Court, Branch 36, the amount of P8,000,000.00 to guarantee the payment of its back rentals; (b) petitioner would
BELLOSILLO, J.: defer the sale of the personal properties of the Westin Seafood Market, Inc., until a final settlement of the case had been arrived at; (c)
May the lessee which instituted before the Metropolitan Trial Court an action for forcible entry with damages against its lessor file petitioner shall allow private respondent to retrieve all the perishable goods from inside the leased premises like frozen meat, vegetables
a separate suit with the Regional Trial Court against the same lessor for moral and exemplary damages plus actual and compensatory and fish, all properly receipted for; (d) petitioner shall allow three (3) maintenance personnel of private respondent to enter the premises
damages based on the same forcible entry? at reasonable working hours to maintain the restaurant equipment; and (e) the parties shall negotiate for the restoration of the premises
On grounds of litis pendencia and forum-shopping, petitioner invokes established jurisprudence that a party cannot by varying the to private respondent, and if no settlement be arrived at on or before January 8, 1993, the hearing on the merits of the case shall proceed
form of action or adopting a different method of presenting his case evade the principle that the same cause of action shall not be and the disposition of the amount deposited representing the rental arrearages shall be left to the discretion of the court.
litigated twice between the same parties or their privies.[1] Petitioner therefore prays for reversal of the decision of the Court of Appeals This agreement was incorporated in the order of the court dated 22 December 1992[3] which in effect terminated for all intents and
dated 27 May 1995, as well as its Resolution dated 17 January 1996 denying reconsideration, which upheld the denial by the Regional Trial purposes the incident on the issuance of a preliminary writ of injunction.
Court of petitioner's motion to dismiss private respondent's damage suit. Private respondent did not comply with its undertaking to deposit with the designated bank the amount representing its back
The antecedents: On 27 May 1991 petitioner leased to private respondent Westin Seafood Market, Inc., a parcel of land with a rentals. Instead, with the forcible entry case still pending with the MeTC, private respondent instituted on 9 June 1993 another action for
commercial building thereon located at Araneta Center, Cubao, Quezon City, for a period of nine (9) years and three (3) months, i.e., from damages against petitioner with the Regional Trial Court of Quezon City. The case was raffled to Branch 101 presided over by Judge Pedro
2 January 1989 to 30 April 1998, with a monthly rental of approximately P600,000.00. The contract contained, among others, the T. Santiago.[4]
following pertinent terms and conditions: Petitioner filed a motion to dismiss the damage suit on the ground of litis pendencia and forum shopping. On 2 July 1993, instead of
EFFECT OF VIOLATIONS ruling on the motion, Judge Santiago issued an order archiving the case pending the outcome of the forcible entry case being heard at the
25. LESSEE hereby agrees that all the provisions contained in this Contract shall be deemed as conditions, as well as covenants, and that MeTC for the reason that "the damages is (sic) principally anchored on whether or not the defendants (petitioner herein) have committed
this Contract shall be automatically terminated and cancelled without resorting to court action should LESSEE violate any or all said forcible entry."[5] On 2 August 1993 petitioner moved for reconsideration of the order and reiterated its motion to dismiss the suit for
conditions, including the payment of Rent, CUSA and other charges indicated in the FLP when due within the time herein stipulated and in damages.
 Before petitioner's motion to dismiss could be resolved, private respondent filed with the RTC on 18 August 1993 an amended
complaint for damages. On 14 September 1993 it also filed an Urgent Ex-Parte Motion for the Issuance of a Temporary Restraining Order
and Motion for the Grant of a Preliminary Prohibitory and Preliminary Mandatory Injunction. On the very same day, Judge Santiago issued
an order (a) denying petitioner's motion to dismiss, (b) admitting private respondent's amended complaint, and (c) granting private
respondent's application for a temporary restraining order against petitioner.
Thus, petitioner filed with the Court of Appeals a special civil action for certiorari and prohibition on the ground that Judge Santiago
acted in excess of his jurisdiction and/or committed grave abuse of discretion amounting to lack of jurisdiction in admitting the amended
complaint of private respondent and issuing a restraining order against petitioner; in allowing private respondent to engage in forum
shopping; and, taking cognizance of the action for damages despite lack of jurisdiction.[6]
But the Court of Appeals dismissed the petition due to the failure of petitioner to file a motion for reconsideration of Judge
Santiago's order of 14 September 1993 which, it explained, was a prerequisite to the institution of a petition for certiorari and
prohibition. It also found that the elements of litis pendencia were lacking to justify the dismissal of the action for damages with the RTC
because despite the pendency of the forcible entry case with the MeTC the only damages recoverable thereat were those caused by the
loss of the use and occupation of the property and not the kind of damages being claimed before the RTC which had no direct relation to
loss of material possession. It clarified that since the damages prayed for in the amended complaint with the RTC were those caused by
the alleged high-handed manner with which petitioner reacquired possession of the leased premises and the sale of private respondents
movables found therein, the RTC and not the MeTC had jurisdiction over the action of damages.[7]
Petitioner, aggrieved by the decision of the appellate court, filed the instant petition for review on certiorari under Rule 45 of the
Rules of Court alleging that it erred in (a) finding that petitioner failed to avail of its plain, speedy and adequate remedy of a prior motion
for reconsideration with the RTC; (b) ruling that the trial judge did not act with grave abuse of discretion in taking cognizance of the action
for damages and injunction despite the pendency of the forcible entry case with the MeTC; and, (c) ruling that private respondent did not
commit forum shopping since the causes of action before the RTC and MeTC were not identical with each other.
There is merit in the petition. While generally a motion for reconsideration must first be filed before resorting to certiorari in order
to give the lower court an opportunity to correct the errors imputed to it[8] this rule admits of exceptions and is not intended to be applied
without considering the circumstances of the case.[9] The filing of the motion for reconsideration before availing of the remedy
of certiorariis not sine qua non when the issue raised is one purely of law,[10] or where the error is patent or the disputed order is
void,[11] or the questions raised on certiorari are the same as those already squarely presented to and passed upon by the lower court.
In its motion for dismissal of the action for damages with the RTC petitioner raised the ground that another action for forcible entry
was pending at the MeTC between the same parties involving the same matter and cause of action. Outrightly rejected by the RTC, the
same issue was elevated by petitioner on certiorari before the Court of Appeals. Clearly, under the prevailing circumstance, any motion
for reconsideration of the trial court would have been a pointless exercise.[12]
We now turn to the issue of whether an action for damages filed with the Regional Trial Court by the lessee against the lessor
should be dismissed on the ground of pendency of another action for forcible entry and damages earlier filed by the same lessee against
the same lessor before the Metropolitan Trial Court.
Section 1 of Rule 70 of the Rules of Court provides that any person deprived of the possession of any land or building by force,
indimidation, threat, strategy or stealth, or against whom the possession of any land or building is unlawfully withheld, may bring an
action in the proper Municipal Trial Court against the person or persons unlawfully withholding or depriving of possession, together with
damages and costs. The mandate under this rule is categorical: that all cases for forcible entry or unlawful detainer shall be filed before
the Municipal Trial Court which shall include not only the plea for restoration of possession but also all claims for damages and costs
arising therefrom. Otherwise expressed, no claim for damages arising out of forcible entry or unlawful detainer may be filed separately
and independently of the claim for restoration of possession.
This is consistent with the principle laid down in Sec. 1, par. (e), of Rule 16 of the Rules of Court which states that the pendency of
another action between the same parties for the same cause is a ground for dismissal of an action. Res adjudicata requires that there
must be between the action sought to be dismissed and the other action the following elements: (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 founded on the same
facts; and, (c) the identity in the two (2) preceding particulars should be such that any judgment which may be rendered on the other
action will, regardless of which party is successful, amount to res adjudicata in the action under consideration.[13]
It is likewise basic under Sec. 3 of Rule 2 of the Revised Rules of Court, as amended, that a party may not institute more than one
suit for a single cause of action. Under Sec. 4 of the same Rule, if two or more suits are instituted on the basis of the same cause of action,
the filing of one or a judgment upon the merits in any one is available as a ground for the dismissal of the other or others. "Cause of
action" is defined by Sec. 2 of Rule 2 as the act of omission by which a party violates a right of another.[14] These premises obtaining, there
is no question at all that private respondent's cause of action in the forcible entry case and in the suit for damages is the alleged illegal
retaking of possession of the leased premises by the lessor, petitioner herein, from which all legal reliefs arise. Simply stated, the
restoration of possession and demand for actual damages in the case before the MeTC and the demand for damages with the RTC both
arise from the same cause of action, i.e., the forcible entry by petitioner into the leased premises.
A comparative study of the two (2) complaints filed by private respondent against petitioner before the two (2) trial courts shows
that not only are the elements of res adjudicata present, at least insofar as the claim for actual and compensatory damages is concerned,
but also that the claim for damages - moral and exemplary in addition to actual and compensatory - constitutes splitting a single cause of
action.Since this runs counter to the rule against multiplicity of suits, the dismissal of the second action becomes imperative.
The complaint for forcible entry contains the following pertinent allegations -
2.01 On 02 January 1989, plaintiff entered into a contract of lease with defendant PDC over a property designated as Ground Floor,
Seafood Market (hereinafter Subject Premises) situated at the corner of EDSA corner MacArthur Street, Araneta Center, Cubao, Quezon
City, for a period of ten (10) years from 02 January 1989 to 30 April 1998.
2.02 Immediately after having acquired actual physical possession of the Subject Premises, plaintiff established and now operates thereon
the now famous Seafood Market Restaurant. Since then, plaintiff had been in actual, continuous, and peaceful physical possession of the
Subject Premises until 31 October 1992.
xxxx
3.02 Plaintiff, being the lessee of the Subject Premises, is entitled to the peaceful occupation and enjoyment of the Subject Premises to
the exclusion of all others, including defendants herein.
3.03 Defendants resort to strong arms tactics to forcibly wrest possession of the Subject Premises from plaintiff and maintain possession
thereof through the use of force, threat, strategy and intimidation by the use of superior number of men and arms amounts to the taking
of the law into their own hands.
3.04 Thus, defendants act of unlawfully evicting out plaintiff from the Subject Premises it is leasing from defendant PDC and depriving
it of possession thereof through the use of force, threat, strategy and intimidation should be condemned and declared illegal for being
contrary to public order and policy.
3.05 Consequently, defendants should be enjoined from continuing with their illegal acts and be ordered to vacate the Subject Premises
and restore possession thereof, together with its contents, to plaintiff.
xxxx
4.07 Considering that defendants act of forcibly grabbing possession of the Subject Premises from plaintiff is illegal and null and void,
defendant should be adjudged liable to plaintiff for all the aforedescribed damages which plaintiff incurred as a result thereof.
The amended complaint for damages filed by private respondent alleges basically the same factual circumstances and issues as
bases for the relief prayed for, to wit:
4. On May 28, 1991, plaintiff and defendant PDC entered into a Contract of Lease for a period of ten years or from January 2, 1989 up to
April 30, 1998 over a property designated as Ground Floor, Seafood Market (hereinafter referred to as Subject Premises) situated at the
corner of EDSA corner McArthur Street, Araneta Center, Cubao, Quezon City. A copy of the lease contract is attached hereto as Annex A.
5. Immediately thereafter, plaintiff took over actual physical possession of Subject Premises, and established thereon the now famous
Seafood Market Restaurant.
xxxx
7. On October 31, 1992 at around 8:30 p.m., defendant PDC, without the benefit of any writ of possession or any lawful court order and
with the aid of approximately forty (40) armed security guards and policemen under the supervision of defendant Tejam, forcibly entered
the subject premises through force, intimidation, threats and stealth and relying on brute force and in a thunderboltish manner and
against plaintiffs will, unceremoniously drew away all of plaintiffs men out of the subject premises, thereby depriving herein plaintiff of its
actual, physical and natural possession of the subject premises. The illegal, high-handed manner and gestapo like take-over by defendants
of subject premises is more particularly described as follows: x x x
8. To date, defendants continue to illegally possess and hold the Subject Premises, including all the multi-million improvements, fixtures
and equipment therein owned by plaintiff, all to the damage and prejudice of plaintiff. The actuations of defendants constitute an
unlawful appropriation, seizure and taking of property against the will and consent of plaintiff. Worse, defendants are threatening to sell
at public auction and without the consent of plaintiff and without lawful authority, the multi-million fixtures and equipment of plaintiff
and at prices way below the market value thereof. Plaintiff hereby attaches as Annex B the letter from defendants dated August 6, 1993
addressed to plaintiff, informing the latter that the former intends to sell at an auction on August 19, 1993 at 2:00 p.m. properties of the
plaintiff presently in defendants possession.
xxxx
12. Defendants unlawful takeover of the premises constitutes a violation of its obligation under Art. 1654 of the New Civil Code requiring
the lessor to maintain the lessee in peaceful and adequate enjoyment of the lease for the entire duration of the contract. Hence, plaintiff
has filed the present suit for the recovery of damages under Art. 1659 of the New Civil Code x x x x
Restated in its bare essentials, the forcible entry case has one cause of action, namely, the alleged unlawful entry by petitioner into
the leased premises out of which three (3) reliefs (denominated by private respondent as its causes of action) arose: (a) the restoration by
the lessor (petitioner herein) of the possession of the leased premises to the lessee; (b) the claim for actual damages due to the losses
suffered by private respondent such as the deterioration of perishable foodstuffs stored inside the premises and the deprivation of the
use of the premises causing loss of expected profits; and, (c) the claim for attorney's fees and costs of suit.
 On the other hand, the complaint for damages prays for a monetary award consisting of (a) moral damages of P500,000.00 and
exemplary damages of another P500,000.00; (b) actual damages of P20,000,000.00 and compensatory damages of P1,000,000.00
representing unrealized profits; and, (c) P200,000.00 for attorney's fees and costs, all based on the alleged forcible takeover of the leased
premises by petitioner. Since actual and compensatory damages were already prayed for in the forcible entry case before the MeTC, it is
obvious that this cannot be relitigated in the damage suit before the RTC by reason of res adjudicata.
The other claims for moral and exemplary damages cannot also succeed considering that these sprung from the main incident
being heard before the MeTC. Jurisprudence is unequivocal that when a single delict or wrong is committed - like the unlawful taking or
detention of the property of another - there is but one single cause of action regardless of the number of rights that may have been
violated, and all such rights should be alleged in a single complaint as constituting one single cause of action.[15] In a forcible entry case,
the real issue is the physical possession of the real property. The question of damages is merely secondary or incidental, so much so that
the amount thereof does not affect the jurisdiction of the court. In other words, the unlawful act of a deforciant in taking possession of a
piece of land by means of force and intimidation against the rights of the party actually in possession thereof is a delict or wrong, or a
cause of action that gives rise to two (2) remedies, namely, the recovery of possession and recovery of damages arising from the loss of
possession, but only to one action. For obvious reasons, both remedies cannot be the subject of two (2) separate and independent
actions, one for recovery of possession only, and the other, for the recovery of damages. That would inevitably lead to what is termed in
law as splitting up a cause of action.[16] In David v. de la Cruz[17] we observed -
Herein tenants have but one cause of action against their landlord, their illegal ejectment or removal from their landholdings, which cause
of action however entitles them to two (2) claims or remedies - for reinstatement and damages. As both claims arise from the same cause
of action, they should be alleged in a single complaint.
A claim cannot be divided in such a way that a part of the amount of damages may be recovered in one case and the rest, in
another.[18] In Bachrach v. Icarangal[19] we explained that the rule was aimed at preventing repeated litigations between the same parties
in regard to the same subject of the controversy and to protect the defendant from unnecessary vexation. Nemo debet bis vexari pro una
et eadem causa.
What then is the effect of the dismissal of the other action? Since the rule is that all such rights should be alleged in a single
complaint, it goes without saying that those not therein included cannot be the subject of subsequent complaints for they are barred
forever.[20] If a suit is brought for a part of a claim, a judgment obtained in that action precludes the plaintiff from bringing a second action
for the residue of the claim, notwithstanding that the second form of action is not identical with the first or different grounds for relief are
set for the second suit. This principle not only embraces what was actually determined, but also extends to every matter which the parties
might have litigated in the case.[21] This is why the legal basis upon which private respondent anchored its second claim for damages, i.e.,
Art. 1659 in relation to Art. 1654 of the Civil Code,[22] not otherwise raised and cited by private respondent in the forcible entry case,
cannot be used as justification for the second suit for damages. We note, not without some degree of displeasure, that by filing a second
suit for damages, private respondent was not only able to press a claim for moral and exemplary damages which by its failure to allege the
same in its suit before the MeTC foreclosed its right to sue on it, but it was also able to obtain from the RTC, by way of another temporary
restraining order, a second reprieve from an impending public auction sale of its movables which it could not anymore secure from the
MeTC before which the matter of the issuance of a preliminary writ of injunction was already closed.
The foregoing discussions provide sufficient basis to petitioner's charge that private respondent and its counsel in the trial courts
committed forum shopping. In Crisostomo v. Securities and Exchange Commission[23] we ruled -
There is forum-shopping whenever, as a result of an adverse opinion in one forum, a party seeks a favorable opinion (other than by appeal
or certiorari) in another. The principle applies x x x with respect to suits filed in the courts x x x in connection with litigations commenced
in the court x x x in anticipation of an unfavorable x x x ruling and a favorable case where the court in which the second suit was brought,
has no jurisdiction.
This Court likewise elucidated in New Pangasinan Review, Inc. v. National Labor Relations Commission[24] that there is forum shopping
when the actions involve the same transactions, the same essential facts and circumstances. The reason behind the proscription of forum
shopping is obvious. This unnecessarily burdens our courts with heavy caseloads, unduly taxes the manpower and financial resources of
the judiciary and trifles with and mocks our judicial processes, thereby adversely affecting the efficient administration of justice. This
condemnable conduct has prompted the Court to issue circulars[25]ordering among others that a violation thereof shall be cause for the
dismissal of the case or cases without prejudice to the taking of appropriate action against the counsel or party concerned.
The records ineluctably show that the complaint lodged by private respondent with the Regional Trial Court of Quezon City
contained no certification of non-forum shopping. When petitioner filed a motion to dismiss the case raising among others the ground of
forum shopping it pointed out the absence of the required certification. The amended complaint, as well as the second and third
amended complaints, attempted to rectify the error by invariably stating that there was no other action pending between the parties
involving the same causes of action although there was actually a forcible entry case pending before the MTC of Quezon City. By its
admission of a pending forcible entry case, it is obvious that private respondent was indulging in forum shopping. While private
respondent conveniently failed to inform the RTC that it had likewise sought damages in the MTC on the basis of the same forcible entry,
the fact remains that it precisely did so, which stratagem was being duplicated in the second case.This is a compelling reason to dismiss
the second case.
WHEREFORE, the Petition is GRANTED. The questioned Decision of the Court of Appeals dated 27 September 1995 and the Order of
the Regional Trial Court of Quezon City dated 24 September 1993 are REVERSED and SET ASIDE. The Regional Trial Court of Quezon City is
directed to dismiss Civil Case No. Q-93-16409, "Westin Seafood Market, Inc. v. Progressive Development Corporation, et al.," and the
Metropolitan Trial Court of Quezon City to proceed with the proper disposition of Civil Case No. 6589, "Westin Seafood Market, Inc. v.
Progressive Development Corporation, et al.," with dispatch considering the summary nature of the case. Treble costs against private
respondent.
SO ORDERED.
Puno, Mendoza, Quisumbing, and Buena, JJ., concur.
G.R. No. L-41423 February 23, 1989
LUIS JOSEPH, petitioner
vs.
HON. CRISPIN V. BAUTISTA, PATROCINIO PEREZ, ANTONIO SIOSON, JACINTO PAGARIGAN, ALBERTO CARDENO and LAZARO
VILLANUEVA, respondents.
Jose M. Castillo for petitioner.
Arturo Z. Sioson for private respondent, Patrocinio Perez.
Cipriano B. Farrales for private respondents except P. Perez.
REGALAD0, J.:
Petitioner prays in this appeal by certiorari for the annulment and setting aside of the order, dated July 8, 1975, dismissing petitioner's
complaint, as well as the order, dated August 22, 1975, denying his motion for reconsideration of said dismissal, both issued by
respondent Judge Crispin V. Bautista of the former Court of First Instance of Bulacan, Branch III.
Petitioner herein is the plaintiff in Civil Case No. 50-V-73 entitled "Luis Joseph vs. Patrocinio Perez, Domingo Villa y de Jesus, Rosario
Vargas, Antonio Sioson, Lazaro Villanueva and Jacinto Pagarigan", filed before the Court of First Instance of Bulacan, Branch III, and
presided over by respondent Judge Crispin V. Bautista; while private respondents Patrocinio Perez, Antonio Sioson, Jacinto Pagarigan and
Lazaro Villanueva are four of the defendants in said case. Defendant Domingo Villa y de Jesus did not answer either the original or the
amended complaint, while defendant Rosario Vargas could not be served with summons; and respondent Alberto Cardeno is included
herein as he was impleaded by defendant Patrocinio Perez, one of respondents herein, in her cross-claim.
The generative facts of this case, as culled from the written submission of the parties, are as follows:
Respondent Patrocinio Perez is the owner of a cargo truck with Plate No. 25-2 YT Phil. '73 for conveying cargoes and passengers for a
consideration from Dagupan City to Manila. On January 12, 1973, said cargo truck driven by defendant Domingo Villa was on its way to
Valenzuela, Bulacan from Pangasinan. Petitioner, with a cargo of livestock, boarded the cargo truck at Dagupan City after paying the sum
of P 9.00 as one way fare to Valenzuela, Bulacan. While said cargo truck was negotiating the National Highway proceeding towards
Manila, defendant Domingo Villa tried to overtake a tricycle likewise proceeding in the same direction. At about the same time, a pick-up
truck with Plate No. 45-95 B, supposedly owned by respondents Antonio Sioson and Jacinto Pagarigan, then driven by respondent Lazaro
Villanueva, tried to overtake the cargo truck which was then in the process of overtaking the tricycle, thereby forcing the cargo truck to
veer towards the shoulder of the road and to ram a mango tree. As a result, petitioner sustained a bone fracture in one of his legs. 1
The following proceedings thereafter took place: 2
Petitioner filed a complaint for damages against respondent Patrocinio Perez, as owner of the cargo truck, based on a breach of contract
of carriage and against respondents Antonio Sioson and Lazaro Villanueva, as owner and driver, respectively, of the pick-up truck, based
on quasi-delict.
Respondent Sioson filed his answer alleging that he is not and never was an owner of the pick-up truck and neither would he acquire
ownership thereof in the future.
On September 24, 1973, petitioner, with prior leave of court, filed his amended complaint impleading respondents Jacinto Pagarigan and
a certain Rosario Vargas as additional alternative defendants. Petitioner apparently could not ascertain who the real owner of said cargo
truck was, whether respondents Patrocinio Perez or Rosario Vargas, and who was the real owner of said pick-up truck, whether
respondents Antonio Sioson or Jacinto Pagarigan.
Respondent Perez filed her amended answer with crossclaim against her co-defendants for indemnity and subrogation in the event she is
ordered to pay petitioner's claim, and therein impleaded cross-defendant Alberto Cardeno as additional alternative defendant.
On September 27, 1974, respondents Lazaro Villanueva, Alberto Cardeno, Antonio Sioson and Jacinto Pagarigan, thru their insurer,
Insurance Corporation of the Philippines, paid petitioner's claim for injuries sustained in the amount of P 1,300.00. By reason thereof,
petitioner executed a release of claim releasing from liability the following parties, viz: Insurance Corporation of the Philippines, Alberto
Cardeno, Lazaro Villanueva, Antonio Sioson and Jacinto Pagarigan.
On December 2, 1974, respondents Lazaro Villanueva, Alberto Cardeno and their insurer, the Insurance Corporation of the Philippines,
paid respondent Patrocinio Perez' claim for damages to her cargo truck in the amount of P 7,420.61.
Consequently, respondents Sioson, Pagarigan, Cardeno and Villanueva filed a "Motion to Exonerate and Exclude Defs/ Cross defs. Alberto
Cardeno, Lazaro Villanueva, Antonio Sioson and Jacinto Pagarigan on the Instant Case", alleging that respondents Cardeno and Villanueva
already paid P 7,420.61 by way of damages to respondent Perez, and alleging further that respondents Cardeno, Villanueva, Sioson and
Pagarigan paid P 1,300.00 to petitioner by way of amicable settlement.
Thereafter, respondent Perez filed her "Opposition to Cross-defs.' motion dated Dec. 2, 1974 and Counter Motion" to dismiss. The so-
called counter motion to dismiss was premised on the fact that the release of claim executed by petitioner in favor of the other
respondents inured to the benefit of respondent Perez, considering that all the respondents are solidarity liable to herein petitioner.
On July 8, 1975, respondent judge issued the questioned order dismissing the case, and a motion for the reconsideration thereof was
denied. Hence, this appeal, petitioner contending that respondent judge erred in declaring that the release of claim executed by
petitioner in favor of respondents Sioson, Villanueva and Pagarigan inured to the benefit of respondent Perez; ergo, it likewise erred in
dismissing the case.
We find the present recourse devoid of merit.
The argument that there are two causes of action embodied in petitioner's complaint, hence the judgment on the compromise agreement
under the cause of action based on quasi-delict is not a bar to the cause of action for breach of contract of carriage, is untenable.
A cause of action is understood to be the delict or wrongful act or omission committed by the defendant in violation of the primary rights
of the plaintiff. 3 It is true that a single act or omission can be violative of various rights at the same time, as when the act constitutes
juridically a violation of several separate and distinct legal obligations. However where there is only one delict or wrong, there is but a
single cause of action regardless of the number of rights that may have been violated belonging to one person. 4
The singleness of a cause of action lies in the singleness of the- delict or wrong violating the rights of one person. Nevertheless, if only one
injury resulted from several wrongful acts, only one cause of action arises. 5 In the case at bar, there is no question that the petitioner
sustained a single injury on his person. That vested in him a single cause of action, albeit with the correlative rights of action against the
different respondents through the appropriate remedies allowed by law.
The trial court was, therefore, correct in holding that there was only one cause of action involved although the bases of recovery invoked
by petitioner against the defendants therein were not necessarily Identical since the respondents were not identically circumstanced.
However, a recovery by the petitioner under one remedy necessarily bars recovery under the other. This, in essence, is the rationale for
the proscription in our law against double recovery for the same act or omission which, obviously, stems from the fundamental rule
against unjust enrichment.
There is no question that the respondents herein are solidarily liable to petitioner. On the evidence presented in the court below, the trial
court found them to be so liable. It is undisputed that petitioner, in his amended complaint, prayed that the trial court hold respondents
jointly and severally liable. Furthermore, the allegations in the amended complaint clearly impleaded respondents as solidary debtors. We
cannot accept the vacuous contention of petitioner that said allegations are intended to apply only in the event that execution be issued
in his favor. There is nothing in law or jurisprudence which would countenance such a procedure.
The respondents having been found to be solidarity liable to petitioner, the full payment made by some of the solidary debtors and their
subsequent release from any and all liability to petitioner inevitably resulted in the extinguishment and release from liability of the other
solidary debtors, including herein respondent Patrocinio Perez.
The claim that there was an agreement entered into between the parties during the pre-trial conference that, after such payment made
by the other respondents, the case shall proceed as against respondent Perez is both incredible and unsubstantiated. There is nothing in
the records to show, either by way of a pre-trial order, minutes or a transcript of the notes of the alleged pre-trial hearing, that there was
indeed such as agreement.
WHEREFORE, the challenged orders of the respondent judge are hereby AFFIRMED.
SO ORDERED.
Melencio-Herrera, (Chairperson), Paras, Padilla, and Sarmiento, JJ., concur.
G.R. No. L-66620 September 24, 1986
REMEDIO V. FLORES, petitioner,
vs.
HON. JUDGE HEILIA S. MALLARE-PHILLIPPS, IGNACIO BINONGCAL & FERNANDO CALION, respondents.
Lucio A. Dixon for respondent F. Calion.
FERIA, J.:
The Court rules that the application of the totality rule under Section 33(l) of Batas Pambansa Blg. 129 and Section 11 of the Interim Rules
is subject to the requirements for the permissive joinder of parties under Section 6 of Rule 3 which provides as follows:
Permissive joinder of parties.-All persons in whom or against whom any right to relief in respect to or arising out of
the same transaction or series of transactions is alleged to exist, whether jointly, severally, or in the alternative,
may, except as otherwise provided in these rules, join as plaintiffs or be joined as defendants in one complaint,
where any question of law or fact common to all such plaintiffs or to all such defendants may arise in the action; but
the court may make such orders as may be just to prevent any plaintiff or defendant from being embarrassed or put
to expense in connection with any proceedings in which he may have no interest.
Petitioner has appealed by certiorari from the order of Judge Heilia S. Mallare-Phillipps of the Regional Trial Court of Baguio City and
Benguet Province which dismissed his complaint for lack of jurisdiction. Petitioner did not attach to his petition a copy of his complaint in
the erroneous belief that the entire original record of the case shall be transmitted to this Court pursuant to the second paragraph of
Section 39 of BP129. This provision applies only to ordinary appeals from the regional trial court to the Court of Appeals (Section 20 of the
Interim Rules). Appeals to this Court by petition for review on certiorari are governed by Rule 45 of the Rules of Court (Section 25 of the
Interim Rules).
However, the order appealed from states that the first cause of action alleged in the complaint was against respondent Ignacio Binongcal
for refusing to pay the amount of P11,643.00 representing cost of truck tires which he purchased on credit from petitioner on various
occasions from August to October, 1981; and the second cause of action was against respondent Fernando Calion for allegedly refusing to
pay the amount of P10,212.00 representing cost of truck tires which he purchased on credit from petitioner on several occasions from
March, 1981 to January, 1982.
On December 15, 1983, counsel for respondent Binongcal filed a Motion to Dismiss on the ground of lack of jurisdiction since the amount
of the demand against said respondent was only P11,643.00, and under Section 19(8) of BP129 the regional trial court shall exercise
exclusive original jurisdiction if the amount of the demand is more than twenty thousand pesos (P20,000.00). It was further averred in
said motion that although another person, Fernando Calion, was allegedly indebted to petitioner in the amount of P10,212.00, his
obligation was separate and distinct from that of the other respondent. At the hearing of said Motion to Dismiss, counsel for respondent
Calion joined in moving for the dismissal of the complaint on the ground of lack of jurisdiction. Counsel for petitioner opposed the Motion
to Dismiss. As above stated, the trial court dismissed the complaint for lack of jurisdiction.
Petitioner maintains that the lower court has jurisdiction over the case following the "novel" totality rule introduced in Section 33(l) of
BP129 and Section 11 of the Interim Rules.
The pertinent portion of Section 33(l) of BP129 reads as follows:
... Provided,That where there are several claims or causes of action between the same or different parties,
embodied in the same complaint, the amount of the demand shall be the totality of the claims in all the causes of
action, irrespective of whether the causes of action arose out of the same or different transactions. ...
Section 11 of the Interim Rules provides thus:
Application of the totality rule.-In actions where the jurisdiction of the court is dependent on the amount involved,
the test of jurisdiction shall be the aggregate sum of all the money demands, exclusive only of interest and costs,
irrespective of whether or not the separate claims are owned by or due to different parties. If any demand is for
damages in a civil action, the amount thereof must be specifically alleged.
Petitioner compares the above-quoted provisions with the pertinent portion of the former rule under Section 88 of the Judiciary Act of
1948 as amended which reads as follows:
... Where there are several claims or causes of action between the same parties embodied in the same complaint,
the amount of the demand shall be the totality of the demand in all the causes of action, irrespective of whether
the causes of action arose out of the same or different transactions; but where the claims or causes of action joined
in a single complaint are separately owned by or due to different parties, each separate claim shall furnish the
jurisdictional test. ...
and argues that with the deletion of the proviso in the former rule, the totality rule was reduced to clarity and brevity and the
jurisdictional test is the totality of the claims in all, not in each, of the causes of action, irrespective of whether the causes of action arose
out of the same or different transactions.
This argument is partly correct. There is no difference between the former and present rules in cases where a plaintiff sues a defendant
on two or more separate causes of action. In such cases, the amount of the demand shall be the totality of the claims in all the causes of
action irrespective of whether the causes of action arose out of the same or different transactions. If the total demand exceeds twenty
thousand pesos, then the regional trial court has jurisdiction. Needless to state, if the causes of action are separate and independent, their
joinder in one complaint is permissive and not mandatory, and any cause of action where the amount of the demand is twenty thousand
pesos or less may be the subject of a separate complaint filed with a metropolitan or municipal trial court.
On the other hand, there is a difference between the former and present rules in cases where two or more plaintiffs having separate
causes of action against a defendant join in a single complaint. Under the former rule, "where the claims or causes of action joined in a
single complaint are separately owned by or due to different parties, each separate claim shall furnish the jurisdictional test" (Section 88
of the Judiciary Act of 1948 as amended, supra). This was based on the ruling in the case of Vda. de Rosario vs. Justice of the Peace, 99
Phil. 693. As worded, the former rule applied only to cases of permissive joinder of parties plaintiff. However, it was also applicable to
cases of permissive joinder of parties defendant, as may be deduced from the ruling in the case of Brillo vs. Buklatan, thus:
 Furthermore, the first cause of action is composed of separate claims against several defendants of different
amounts each of which is not more than P2,000 and falls under the jurisdiction of the justice of the peace court
under section 88 of Republic Act No, 296. The several claims do not seem to arise from the same transaction or
series of transactions and there seem to be no questions of law or of fact common to all the defendants as may
warrant their joinder under Rule 3, section 6. Therefore, if new complaints are to be filed in the name of the real
party in interest they should be filed in the justice of the peace court. (87 Phil. 519, 520, reiterated in Gacula vs.
Martinez, 88 Phil. 142, 146)
Under the present law, the totality rule is applied also to cases where two or more plaintiffs having separate causes of action against a
defendant join in a single complaint, as well as to cases where a plaintiff has separate causes of action against two or more defendants
joined in a single complaint. However, the causes of action in favor of the two or more plaintiffs or against the two or more defendants
should arise out of the same transaction or series of transactions and there should be a common question of law or fact, as provided in
Section 6 of Rule 3.
The difference between the former and present rules in cases of permissive joinder of parties may be illustrated by the two cases which
were cited in the case of Vda. de Rosario vs. Justice of the Peace (supra) as exceptions to the totality rule. In the case of Soriano y Cia vs.
Jose (86 Phil. 523), where twenty-nine dismissed employees joined in a complaint against the defendant to collect their respective claims,
each of which was within the jurisdiction of the municipal court although the total exceeded the jurisdictional amount, this Court held
that under the law then the municipal court had jurisdiction. In said case, although the plaintiffs' demands were separate, distinct and
independent of one another, their joint suit was authorized under Section 6 of Rule 3 and each separate claim furnished the jurisdictional
test. In the case of International Colleges, Inc. vs. Argonza (90 Phil. 470), where twenty-five dismissed teachers jointly sued the defendant
for unpaid salaries, this Court also held that the municipal court had jurisdiction because the amount of each claim was within, although
the total exceeded, its jurisdiction and it was a case of permissive joinder of parties plaintiff under Section 6 of Rule 3.
Under the present law, the two cases above cited (assuming they do not fall under the Labor Code) would be under the jurisdiction of the
regional trial court. Similarly, in the abovecited cases of Brillo vs. Buklatan and Gacula vs. Martinez (supra), if the separate claims against
the several defendants arose out of the same transaction or series of transactions and there is a common question of law or fact, they
would now be under the jurisdiction of the regional trial court.
In other words, in cases of permissive joinder of parties, whether as plaintiffs or as defendants, under Section 6 of Rule 3, the total of all
the claims shall now furnish the jurisdictional test. Needless to state also, if instead of joining or being joined in one complaint separate
actions are filed by or against the parties, the amount demanded in each complaint shall furnish the jurisdictional test.
In the case at bar, the lower court correctly held that the jurisdictional test is subject to the rules on joinder of parties pursuant to Section
5 of Rule 2 and Section 6 of Rule 3 of the Rules of Court and that, after a careful scrutiny of the complaint, it appears that there is a
misjoinder of parties for the reason that the claims against respondents Binongcal and Calion are separate and distinct and neither of
which falls within its jurisdiction.
WHEREFORE, the order appealed from is affirmed, without pronouncement as to costs.
SO ORDERED.
Fernan, Alampay, Gutierrez, Jr., and Paras, JJ., concur.
PARTIES TO CIVIL ACTION (RULE 3, SECTION 1 O 22)
EDUARDO L. RAYO, G.R. No. 165142
Petitioner,
Present:
QUISUMBING, J., Chairperson,
- versus - CARPIO,
CARPIO MORALES,
TINGA, and
VELASCO, JR., JJ.
METROPOLITAN BANK AND TRUST COMPANY AND BRANCH 223 Promulgated:
OF THE REGIONAL TRIAL COURT OF QUEZON CITY,
Respondents. December 10, 2007
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
DECISION
QUISUMBING, J.:
Before us is a petition for review assailing the Resolutions dated June 15, 2004[1] and August 23, 2004[2] of the Court of Appeals in CA-G.R.
SP No. 83895 for annulment of judgment.
The pertinent facts are undisputed.
Midas Diversified Export Corp. (Midas), thru its president, Mr. Samuel U. Lee, obtained six (6) loans from private respondent
Metropolitan Bank and Trust Company (Metrobank), amounting to P588,870,000 as evidenced by promissory notes. To secure the
payment of an P8,000,000 loan, Louisville Realty & Development Corporation (Louisville), thru its president, Mr. Samuel U. Lee, executed
in favor of Metrobank, a real estate mortgage over three parcels of land situated at No. 40 Timog Ave., Brgy. Laging Handa, Quezon City,
with all the buildings and improvements thereon. The properties are covered by Transfer Certificates of Title (TCT) Nos. N-163455, N-
166349 and N-166350 issued by the Registry of Deeds of Quezon City.
When the debtor-mortgagor failed to pay, Metrobank extra-judicially foreclosed the real estate mortgage in accordance with Act No.
3135,[3] as amended. Thereafter, in a public auction, Metrobank was the highest bidder. A Certificate of Sale[4] dated December 11,
2000 was duly registered with the Registry of Deeds of Quezon City on December 13, 2000. When Louisville refused to turn over the real
properties, on March 17, 2001, Metrobank filed before the Regional Trial Court (RTC), Branch 223, Quezon City, an ex partepetition[5] for
the issuance of a writ of possession docketed as LRC Case No. Q-13915(01). After presentation of evidence ex parte, the RTC granted the
petition in an Order[6]dated July 5, 2001, the dispositive portion of which reads as follows:
WHEREFORE, in consideration of the foregoing premises, the instant petition is hereby GRANTED. Upon the filing of
a bond in the amount of ONE HUNDRED THOUSAND PESOS ([P]100,000.00), let a Writ of Possession over the
properties covered by Transfer Certificates of Title Nos. N-163455, N-166349 & N-166350 issue in favor of the
petitioner METROPOLITAN BANK & TRUST COMPANY to be implemented by the Deputy Sheriff of Branch 223,
Regional Trial Court of Quezon City by placing the petitioner in possession over the parcels of land with all its
improvements.
SO ORDERED.[7]
On September 24, 2001, Metrobank posted the required bond. Consequently, a writ of possession was issued on October 9, 2001. This
was partially implemented as to TCT No. N-163455, as evidenced by the Turn-Over Receipt[8] dated December 13, 2002. The writ over the
two remaining properties, under TCT Nos. N-166349 and N-166350, were subsequently implemented as evidenced by the Turn-Over
Receipt[9] dated December 3, 2003.
Meanwhile, on April 3, 2002, petitioner Eduardo L. Rayo filed a complaint[10] docketed as Civil Case No. Q02-46514 against
Metrobank for Nullification of Real Estate Mortgage Contract(s) and Extrajudicial Foreclosure Sale, in the RTC, Branch 99, Quezon City.
On May 13, 2004, petitioner Rayo filed with the Court of Appeals a Petition[11] for Annulment of Judgment on the ground of absolute lack
of due process. Petitioner alleged that his predecessor, Louisville, was not notified of the proceedings and that Section
7[12] (ex parte motion or petition for the issuance of a writ of possession) of Act No. 3135 is unconstitutional.
On June 15, 2004, the Court of Appeals denied the petition for lack of merit. The Court of Appeals ruled that petitioner is
neither the registered owner nor the successor-in-interest of the registered owner; hence, not a real party-in-interest. It also ruled that
there is no basis to challenge the constitutionality of Section 7 of Act No. 3135, as amended as it constitutes a collateral attack against said
provision. Further, petitioner availed of the wrong remedy in filing Civil Case No. Q02-46514. Petitioner sought reconsideration, but was
likewise denied.
Petitioner now comes before us raising the following as primary issue:
WHETHER OR NOT SECTION 7 OF ACT NO. 3135 IS CONTRARY TO THE DUE PROCESS PROVISION OF THE
PHILIPPINE CONSTITUTION CONSIDERING THAT SUCH SECTION 7 OF THE LAW PROVIDES OR ALLOWS,
ACCORDING TO THIS HONORABLE COURT, FOR AN EX-PARTE PROCEEDING WHICH IS A JUDICIAL PROCEEDING
BROUGHT FOR THE BENEFIT OF ONE PARTY ONLY, AND WITHOUT NOTICE TO, OR CONSENT BY ANY PERSON
ADVERSELY INTERESTED OR A PROCEEDING WHEREIN RELIEF IS GRANTED WITHOUT AN OPPORTUNITY FOR THE
PERSON AGAINST WHOM THE RELIEF IS SOUGHT TO BE HEARD, AS HELD IN THE CASE OF GOVERNMENT SERVICE
INSURANCE SYSTEM VS. COURT OF APPEALS, 169 SCRA 244 @ 255, JANUARY 20, 1989.[13]
He also raises the following as secondary issues:
I.
WHETHER OR NOT THE PETITIONER HAS THE LEGAL PERSONALITY TO SEEK THE ANNULMENT OF JUDGMENT IN
[THE] SUBJECT LRC CASE NO. Q-13915(01).
II.
WHETHER OR NOT PRIVATE RESPONDENT VIOLATED THE RULE AGAINST FORUM-SHOPPING WHEN IT DID NOT
INFORM THE HONORABLE BRANCH 223 OF THE REGIONAL TRIAL COURT OF QUEZON CITY REGARDING THE FILING
OF CIVIL CASE NO. Q-02-46514 FOR NULLIFICATION OF REAL ESTATE MORTGAGE CONTRACT AND THE EXTRA-
JUDICIAL FORECLOSURE SALE OF THE SAME SUBJECT REAL PROPERTIES AND THE PENDENCY OF THE SAME BEFORE
THE HONORABLE BRANCH 99 OF THE SAME REGIONAL TRIAL COURT.[14]
 Stated simply, the issues raised are: (1) Does petitioner have the legal personality in the annulment of judgment proceedings? SO ORDERED.
(2) Is Section 7 of Act No. 3135, as amended, unconstitutional? (3) Is respondent guilty of forum-shopping?
Petitioner insists that contrary to the ruling of the Court of Appeals, he has the legal personality to institute the annulment of
judgment case against Metrobank, considering that the March 25, 2002 deed of assignment he entered into with Louisville and Winston
Linwy L. Chua makes him a co-assignee over the subject real properties.
For its part, Metrobank claims that it was not a party to the deed of assignment among Louisville, Chua and petitioner, hence,
it has no privity of contract with petitioner Rayo. Moreover, Metrobank points out that the real properties had already been LEONARDO A. QUISUMBING
extrajudicially foreclosed when petitioner and his assignors executed the deed of assignment. Associate Justice
Under Section 2,[15] Rule 3 of the Rules of Court, every action must be prosecuted or defended in the name of the real party-in-
interest, or one who stands to be benefited or injured by the judgment in the suit. [16] A real party-in-interest is one with a present WE CONCUR:
substantial interest which means such interest of a party in the subject matter of the action as will entitle him, under the substantive law,
to recover if the evidence is sufficient, or that he has the legal title to demand.[17]
Now, is petitioner Rayo a real party-in-interest? Initially, we recognized herein petitioner as the co-assignee of the subject real
properties as shown in the March 25, 2002deed of assignment. However, while petitioner would be injured by the judgment in this suit,
we find that petitioner has no present substantial interest to institute the annulment of judgment proceedings and nullify the order
granting the writ of possession. ANTONIO T. CARPIO
First, there was no violation of petitioners right to constitutional due process. In a long line of cases,[18] we have consistently Associate Justice
ruled that the issuance of a writ of possession in favor of the purchaser in a foreclosure sale of a mortgaged property under Section 7 of CONCHITA CARPIO MORALES DANTE O. TINGA
Act No. 3135, as amended is a ministerial duty of the court. The purchaser of the foreclosed property, upon ex parte application and the Associate Justice Associate Justice
posting of the required bond, has the right to acquire possession of the foreclosed property during the 12-month redemption period and PRESBITERO J. VELASCO, JR.
with more reason, after the expiration of the redemption period. Associate Justice
An ex parte petition for the issuance of a writ of possession under Section 7 of Act No. 3135 is not, strictly speaking, a judicial
process as contemplated in Article 433[19]of the Civil Code. It is a judicial proceeding for the enforcement of ones right of possession as
purchaser in a foreclosure sale. It is not an ordinary suit filed in court, by which one party sues another for the enforcement of a wrong or ATTESTATION
protection of a right, or the prevention or redress of a wrong. It is a non-litigious proceeding authorized in an extrajudicial foreclosure of
mortgage pursuant to Act No. 3135, as amended, and is brought for the benefit of one party only, and without notice to, or consent by I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the
any person adversely interested. It is a proceeding where the relief is granted without requiring an opportunity for the person against opinion of the Courts Division.
whom the relief is sought to be heard. No notice is needed to be served upon persons interested in the subject property.[20]
Second, in the deed of assignment, petitioner also acknowledged that the subject real p roperties were already sold at
various extrajudicial foreclosure sales and bought by Metrobank. Clearly, petitioner recognized the prior existing right of Metrobank
as the mortgagee-purchaser over the subject real properties. [21] Actual knowledge of a prior mortgage with Metrobank is equivalent
to notice of registration [22] in accordance with Article 2125[23] of the Civil Code. Conformably with Articles 1312[24] and 2126[25] of the LEONARDO A. QUISUMBING
Civil Code, a real right or lien in favor of Metrobank had already been established, subsisting over the properties until the discharge of Associate Justice
the principal obligation, whoever the possessor(s) of the land might be. [26] As petitioner is not a party whose interest is adverse to Chairperson
that of Louisville, there was no bar to the issuance of a writ of possession to Metrobank. It does not matter that petitioner was not COMMISSIONER ANDREA D. DOMINGO, BUREAU OF IMMIGRATION, petitioner, vs. HERBERT MARKUS EMIL SCHEER, respondent.
specifically named in the writ of possession nor notified of such proceedings. DECISION
Third, we also note that petitioner availed of the wrong remedy in filing Civil Case No. Q02-46514, for nullification of real CALLEJO, SR., J.:
estate mortgage and extrajudicial foreclosure sale, more than six (6) months after the issuance of the writ of possession considering the This is a petition for review under Rule 45 of the Rules of Court, as amended, of the Decision[1] of the Court of Appeals in CA-G.R. SP
mandate of Section 8[27] of Act No. 3135, as amended. Hence, even petitioners action for annulment of judgment cannot prosper as it No. 71094 granting the respondents petition for certiorari and prohibition annulling the order of arrest issued by the petitioner, and
cannot be a substitute for a lost remedy. permanently enjoining her from deporting the respondent from the Philippines. Through its decision, the CA virtually reversed the
Now, petitioner is challenging the constitutionality of Section 7 of Act No. 3135, as amended. He avers that Section 7 violates Summary Deportation Order[2] of the Board of Commissioners (BOC) and its Omnibus Resolution[3] denying the respondents Urgent
the due process clause because, by the mere filing of an ex parte motion in the proper cadastral court, the purchaser in a foreclosure sale Motion for Reconsideration of said Order, and enjoining the petitioner from deporting the respondent.
is allowed to obtain possession of the foreclosed property during the redemption period. The facts as culled from the records are as follows:
The Court of Appeals ruled that petitioners attempt to challenge the constitutionality of Section 7 of Act No. 3135, as Respondent Herbert Markus Emil Scheer, a native of Ochsenfurt, Germany, was a frequent visitor of the Philippines. On July 18,
amended, constitutes a collateral attack that is not allowed. We fully agree with the appellate courts ruling. For reasons of public policy, 1986, his application for permanent resident status was granted.[4] The Bureau of Immigration and Deportation (BID) issued in favor of the
the constitutionality of a law cannot be attacked collaterally.[28] respondent Alien Certificate of Registration No. B-396907 dated September 16, 1987[5] and Immigration Certificate of Residence No.
With regard to forum-shopping; forum-shopping is the filing of multiple suits involving the same parties for the same cause 256789 dated February 24, 1988.[6] The Commissioner stated that the granting of the petition would redound to the benefit of the Filipino
of action, either simultaneously or successively, for the purpose of obtaining a favorable judgment. It exists where the elements people.[7] During his sojourn in the Philippines, the respondent married widowed Edith delos Reyes[8] with whom he had two daughters.
of litis pendentia are present or where a final judgment in one case will amount to res judicata in another.[29] The issuance of the writ They had a son, Herbert Scheer, Jr., but he passed away on November 13, 1995.[9] They resided in Puerto Princesa City, Palawan, where
of possession being a ministerial function, and summary in nature, it cannot be said to be a judgment on the merits. It is only an the respondent established and managed the Bavaria Restaurant. On May 21, 1991, he was appointed Confidential Agent by then NBI
incident in the transfer of title. Hence, a separate case for annulment of mortgage and foreclosure sale cannot be barred by litis Director Alfredo S. Lim.[10]
pendentia or res judicata.[30] Clearly, insofar as LRC Case No. Q-13915(01) and Civil Case No. Q02-46514 are concerned, Metrobank is In a Letter dated June 29, 1995, Vice Consul Jutta Hippelein informed the Philippine Ambassador to Bonn, Germany, that the
not guilty of forum-shopping. respondent had police records and financial liabilities in Germany.[11]
WHEREFORE, the petition is DENIED for lack of merit. The assailed Resolutions dated June 15, 2004 and August 23, 2004 of the The Department of Foreign Affairs received from the German Embassy in Manila Note Verbale No. 369/95 dated July 26, 1995,
Court of Appeals in CA-G.R. SP No. 83895 are hereby AFFIRMED. Costs against the petitioner. informing it that the respondent was wanted by the German Federal Police; that a warrant of arrest had been issued against him; and that
the respondent will be served with an official document requesting him to turn over his German passport to the Embassy which was
invalidated on July 2, 1995.[12] The Embassy requested the Department of Foreign Affairs to inform the competent Philippine authorities of
the matter.The BOC thereafter issued a Summary Deportation Order dated September 27, 1997. The penultimate paragraph of the Order
reads:
WHEREFORE, the foregoing considered, the Board of Commissioners hereby orders the following:
1. Cancellation of respondents permanent residence visa;
2. Respondents summary deportation and permanent exclusion from the Philippines; and
3. Inclusion of his name on the Bureaus Blacklist.
PROVIDED, however that said summary deportation should be held in abeyance in case said alien has a pending final and executory
criminal conviction where the imposed penalty is imprisonment, in which case, he has to serve first such imposed penalty, and/or has a
pending criminal, civil or administrative action and a Hold Departure Order has been issued or that his presence in said action is
indispensable. In such instances, the alien should remain in the custody of the Bureau until his turnover to the proper authorities in case
he has to serve imprisonment or in case of pendency of civil or criminal administrative action, he shall remain in the custody of the Bureau
until such time that his pending cases shall have been decided, terminated or settled, as the case may be, unless circumstances demand
the immediate implementation of this summary deportation.
...
SO ORDERED.[13]
In issuing the said order, the BOC relied on the correspondence from the German Vice Consul on its speculation that it was unlikely
that the German Embassy will issue a new passport to the respondent; on the warrant of arrest issued by the District Court of Germany
against the respondent for insurance fraud; and on the alleged illegal activities of the respondent in Palawan. [14] The BOC concluded that
the respondent was not only an undocumented but an undesirable alien as well.
When the respondent was apprised of the deportation order, he forthwith aired his side to then BID Commissioner Leandro T.
Verceles. The Commissioner allowed the respondent to remain in the Philippines, giving the latter time to secure a clearance and a new
passport from the German Embassy.[15] Then Presidential Assistant Teodorico K. Imperial wrote a Testimonial dated November 24, 1995,
in behalf of the respondent addressed to Commissioner Verceles. Nonetheless, the respondent, through counsel, filed on December 5,
1995 an Urgent Motion for Reconsideration of the Summary Deportation Order of the BOC.[16] In his motion, the respondent alleged, inter
alia, that:
1. The elementary rules of due process require notice and opportunity to be heard before a person can be lawfully deprived of his right
(Ute Paterok vs. Bureau of Customs, 193 SCRA 132). In the instant case, although it is acknowledged that the Honorable Office may
conduct summary deportation proceedings, respondent was not given notice and opportunity to be heard before said Summary
Deportation Order was issued. Respondents right to procedural due process was therefore violated. Consequently, the Summary
Deportation Order is invalid.
2. In issuing, the Summary Deportation Order, this Honorable Office relied on Note Verbal No. 369/95 issued by the Embassy of the
Federal Republic of Germany, Manila, notifying the Department of Foreign Affairs and this Honorable Office about the warrant of arrest
against respondent for alleged illegal insurance fraud and illegal activities. However, a close scrutiny of said note verbal shows that
nowhere therein does it state that respondent was involved in insurance fraud or in any kind of illegal activities in Germany or anywhere
else in the world, such as in Palawan. Therefore, the main basis of the Summary Deportation Order is incompetent as evidence against
respondent who is, like every Filipino, presumed to be innocent until his guilt is proven beyond reasonable doubt.
3. The power to deport alien is a police power measure necessary against undesirable alien whose presence in the country is injurious to
the public good and domestic tranquility of the country (Board of Commissioner Commission on Immigration vs. De la Rosa, 197 SCRA
853). It is respectfully submitted that respondent is not an undesirable alien. He has stayed in the Philippines for more or less than (10)
years. He has married a Filipina and has three (3) minor children. He has established his business in Palawan and he has no police record
whatsoever. Respondent has considered the Philippines his second home and he has nowhere else to go back to in Germany. Under the
circumstances and for humanitarian considerations, respondent is not an undesirable alien whose deportation is warranted. Likewise, the
mere fact that his passport was not renewed by the German Embassy does not also automatically justify the deportation of respondent.[17]
However, the BOC did not resolve the respondents motion. The respondent was neither arrested nor deported.
Meanwhile, on February 15, 1996, the District Court of Straubing rendered a Decision dismissing the criminal case against the
respondent for physical injuries.[18] The German Embassy in Manila, thereafter, issued a temporary passport to the respondent.
In a Letter dated March 1, 1996, the respondent informed Commissioner Verceles that his passport had been renewed following
the dismissal of the said criminal case. He reiterated his request for the cancellation of the Summary Deportation Order dated September
27, 1995 and the restoration of his permanent resident status.[19] Subsequently, on March 12, 1996, the German Embassy issued to the
respondent a regular passport, to expire on March 11, 2006.
The BOC still failed to resolve the respondents Urgent Motion for Reconsideration. Commissioner Verceles did not respond to the
respondents March 1, 1996 Letter. The respondent remained in the Philippines and maintained his business in Palawan. On March 20,
1997, the Department of Labor and Employment approved his application for Alien Employment Registration Certificate as manager of the
Bavaria Restaurant in Puerto Princesa City.
In the meantime, petitioner Immigration Commissioner Andrea T. Domingo assumed office. She wrote the German Embassy and
inquired if the respondent was wanted by the German police. On April 12, 2002, the German Embassy replied that the respondent was
not so wanted.[20] At about midnight on June 6, 2002, Marine operatives and BID agents apprehended the respondent in his residence on
orders of the petitioner. He was whisked to the BID Manila Office and there held in custody while awaiting his deportation. Despite
entreaties from the respondents wife[21] and his employees, the petitioner refused to release the respondent.[22]
Shocked at the sudden turn of events, the respondent promptly communicated with his lawyer. The latter filed with the BID a
motion for bail to secure the respondents temporary liberty.On June 11, 2002, the respondents counsel filed with the Court of Appeals a
petition for certiorari, prohibition and mandamus with a prayer for temporary restraining order and writ of preliminary injunction, to
enjoin the petitioner from proceeding with the respondents deportation.[23] The respondent (petitioner therein) alleged, inter alia, that his
arrest and detention were premature, unjust, wrongful, illegal and unconstitutional, effected without sufficient cause and without
jurisdiction or with grave abuse of discretion. He asserted that there was no speedy remedy open to him in the ordinary course of
law[24] and that his Urgent Motion for Reconsideration of the Summary Deportation Order of the BOC had not yet been resolved despite
the lapse of more than six years. The respondent averred that he was a fully documented alien, a permanent resident and a law-abiding
citizen. He, thus, prayed as follows:
PRAYER
WHEREFORE, it is most respectfully prayed of this Honorable Court that:
1. Upon the filing of this Petition, this Honorable Court issue a Temporary Restraining Order to enjoin respondent Commissioner from
enforcing any order to deport petitioner;
2. After due hearing, a writ of preliminary and mandatory injunction be correspondingly issued to maintain the status quo pending
resolution of the Petition on the merits.
3. After hearing, judgment be rendered:
a) Directing and mandating respondent Commissioner and the body she heads to resolve the Motion for Reconsideration filed in 1995, in
his favor, and nullifying or suspending the implementation of any order, oral or written, she may have issued or issue to deport petitioner;
and
b) Making the injunction in petitioners favor permanent.
Petitioner likewise prays for such other and further relief as may be deemed just and equitable in the premises, such as directing
respondent, if Herbert Scheer is deported before the matter is heard on notice, to authorize his return.[25]
The BOC ruled that its September 27, 1995 Order had become final and executory after the lapse of one year, citing our rulings
in Sy vs. Vivo,[26] and Lou vs. Vivo.[27] The BOC also held that it was not competent to reverse the September 27, 1995 Order, citing our
ruling in Immigration Commissioner vs. Fernandez.[28] It declared that the respondent may seek the waiver of his exclusion via deportation
proceedings through the exceptions provided by Commonwealth Act No. 613,[29] Section 29 (a)(15), but that his application for the waiver
presupposes his prior removal from the Philippines.
In a parallel development, the respondent procured a letter from the National Bureau of Investigation (NBI) in Puerto Princesa City
certifying that he had no pending criminal record.[30]The Puerto Princesa City Philippine National Police (PNP) also issued a certification
that the respondent had no pending criminal or derogatory records in the said office.[31]
Meanwhile, on June 26, 2002, the Court of Appeals issued a status quo order restraining the petitioner from deporting the
respondent on a bond of P100,000.00.[32] On July 18, 2002, the BOC issued an Omnibus Resolution dated June 14, 2002, pendente
lite denying the respondents Urgent Motion for Reconsideration, Motion for Bail/Recognizance, and the Letter dated June 11, 2002. The
decretal portion of the resolution reads:
Wherefore, in view of the foregoing circumstances, we deny the prayers of the Urgent Motion for Reconsideration of 5 December 1995,
the Motion for Bail/Recognizance dated 7 June 2002 and the Letter of 11 June 2002. Further, we hereby order the following:
1. Subject to the submission of appropriate clearances, the summary deportation order the respondent Herbert Scheer, German, under BI
Office Memorandum Order No. 34 (series of 1989) and the BOC Summary Deportation Order of 27 September 1995;
2. Permanent exclusion of Herbert Scheer from the Philippines under C.A. No. 613, Section 40 (a)(15).
3. Inclusion of the name of Herbert Scheer in the Immigration Black List; and
4. Forfeiture of the bail bond, if any, of Herbert Scheer under C.A. No. 613, Section 40 (a)(15).
...
IT IS SO ORDERED.[33]
During the hearing of the respondents plea for a writ of preliminary mandatory injunction before the CA on July 22, 2002, the Office
of the Solicitor General (OSG) manifested that the State had no opposition to the respondents re-entry and stay in the Philippines,
provided that he leave the country first and re-apply for admission and residency status with the assurance that he would be re-
admitted.[34] The respondents counsel manifested to the appellate court that he had just been informed by the OSG of the Omnibus
Resolution of the BOC dated June 14, 2002.
 In her Comment on the Petition, the petitioner (the respondent therein) alleged, inter alia, the following:
1) that the BOC was an indispensable party to the petition;
2) the petitioners failure to implead the BOC warranted the denial of the petition;
3) the allowance by then Immigration Commissioner Leandro Verceles for the petitioner therein to renew his passport and
secure clearances, even if proved, was not binding on the BOC;
4) the September 27, 1995 Order of the BOC was already executory when the respondent filed her petition in the CA;
5) the German Embassys issuance of a new passport did not legalize the respondents stay in this country, which became
illegal on July 2, 1995 when his passport expired;
6) the respondent therein did not act with abuse of discretion in causing the arrest and detention of the respondent based
on the BOCs Summary Deportation Order; and
7) the BOC did not act with grave abuse of discretion in issuing its Summary Deportation Order and Omnibus Resolution and
such order and resolution were not mooted by the German Embassys issuance of a new passport in favor of the
respondent.
In view of the Omnibus Resolution of the BOC, the respondent (petitioner therein) in his Memorandum prayed for the nullification
of the BOCs Order, as well as its Omnibus Resolution denying his Urgent Motion for Reconsideration considering that with the issuance of
a new passport, there was no more basis for his deportation, thus:
RELIEF
WHEREFORE, it is most respectfully prayed of this Honorable Court that:
1. Upon the filing of this Memorandum, this Honorable Court forthwith direct and authorize the immediate release of petitioner, even on
undersigneds recognizance, until further orders from this Honorable Court;
2. The Summary Deportation Order of September 27, 19[9]5, affirmed by respondent allegedly on June 14, 2002 and made known only
yesterday, be nullified to the extent that it directs the deportation of petitioner, who has removed the very basis of said Order of not
having a valid passport, and that the Resolution of June 14, 2002 be nullified in toto; and,
3. The Temporary Restraining Order of June 26, 2002 be converted into a permanent injunction or writ of prohibition.
Petitioner likewise prays for such other and further relief as may be deemed just and equitable in the premises.[35]
Surprisingly, the respondents counsel received on July 24, 2003 a Letter from the petitioner dated July 16, 2002 stating that, the
BOC was in the course of reviewing the deportation case against Mr. Scheer, and that its findings would be given in due time.[36]
On August 20, 2002, the Court of Appeals rendered a Decision in favor of the respondent granting his petition for certiorari and
prohibition and permanently enjoining the petitioner from deporting the respondent. The decretal portion of the Decision reads:
WHEREFORE, premises considered, the petitions for certiorari and prohibition are hereby GRANTED. Accordingly, any order, oral or
written, issued by respondent Commissioner Domingo against petitioner, in relation to his deportation, is hereby ANNULLED, and
respondent Commissioner Domingo is hereby permanently enjoined/prohibited from deporting petitioner, in so far as this case is
concerned.
It is likewise ordered that petitioner be released from his confinement/detention in the Bureau of Immigration UNLESS there is/are fresh
new grounds/cases that will warrant his continued detention.
SO ORDERED.[37]
The Court of Appeals ruled that the German Embassys subsequent issuance of passport to the respondent before the BOCs
issuance of its Omnibus Resolution had mooted the September 27, 1995 Summary Deportation Order, as well as the arrest and detention
of the respondent. According to the court, it made no sense to require the respondent to leave the country and thereafter re-apply for
admission with the BOC. Furthermore, since the grounds cited by the BOC in its Summary Deportation Order no longer existed, there was
no factual and legal basis to disqualify the respondent from staying in the country.
On the issue of whether the members of the BOC were indispensable parties, the CA ruled as follows:
a) There are quite a number of cases in relevant jurisprudence wherein only the Immigration Commissioner was impleaded to decide
whether an alien may stay or be deported, such as in the case of Vivo vs. Arca (19 SCRA 878) and Vivo vs. Cloribel (22 SCRA 159).
b) In the case of Caruncho III vs. COMELEC (315 SCRA 693), it was pronounced that: Ordinarily, the nonjoinder of an indispensable party or
the real party interest is not by itself a ground for the dismissal of the petition. The court before which the petition is filed must first
require the joinder of such party. It is the noncompliance with said order that would be a ground for the dismissal of the petition.
thus, c) respondent may be estopped for not raising such issue earlier.[38]
Aggrieved, the respondent therein, now the petitioner, through the Office of the Solicitor General, appealed to us for relief. The
petitioner contends that the Court of Appeals erred on a question of law in granting the respondents petition in CA-G.R. SP No. 71094.[39]
In support of his contention, the Solicitor General has submitted the following arguments:
I. THE WRIT OF MANDAMUS DOES NOT LIE AGAINST THE COMMISSIONER OF THE BUREAU OF IMMIGRATION TO RESOLVE RESPONDENTS
URGENT MOTION FOR RECONSIDERATION OF THE SUMMARY DEPORTATION ORDER, CONSIDERING THAT IT IS THE BOARD OF
COMMISSIONERS, AND NOT THE COMMISSIONER ALONE, WHICH HAS AUTHORITY TO MAKE SAID RESOLUTION.
II. THE WRIT OF CERTIORARI DOES NOT LIE AGAINST THE COMMISSIONER OF THE BUREAU OF IMMIGRATION, CONSIDERING THAT IT IS
THE BOARD OF COMMISSIONERS, AND NOT THE COMMISSIONER ALONE, WHICH ISSUED THE SUMMARY DEPORTATION ORDER AND THE
OMNIBUS RESOLUTION.
III. THE WRIT OF PROHIBITION DOES NOT LIE AGAINST THE COMMISSIONER OF THE BUREAU OF IMMIGRATION, PROHIBITING THE
IMPLEMENTATION OF THE SUMMARY DEPORTATION ORDER AND THE OMNIBUS RESOLUTION, CONSIDERING THAT THE BOARD OF
COMMISSIONERS WAS NOT IMPLEADED AS PARTY-RESPONDENT IN THE PETITION IN CA-G.R. SP NO. 71094.
IV. ASSUMING BUT WITHOUT ADMITTING THAT THE BOARD OF COMMISSIONERS WAS PROPERLY IMPLEADED AS PARTY-RESPONDENT IN
THE PETITION IN CA-G.R. SP NO. 71094, NEVERTHELESS, THE SUMMARY DEPORTATION ORDER AND THE OMNIBUS RESOLUTION WERE
NOT ISSUED WITHOUT OR IN EXCESS OF JURISDICTION OR WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF (SIC) EXCESS OF
JURISDICTION.
V. FURTHER ASSUMING BUT WITHOUT ADMITTING THAT THE BOARD OF COMMISSIONERS WAS PROPERLY IMPLEADED AS PARTY-
RESPONDENT IN THE PETITION IN CA-G.R. SP NO. 71094, THE COMMISSIONER OF THE BUREAU OF IMMIGRATION DID NOT ACT WITHOUT
OR IN EXCESS OF JURISDICTION OR WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN
IMPLEMENTING THE SUMMARY DEPORTATION ORDER AND THE OMNIBUS RESOLUTION.[40]
Elucidating on his first three arguments, the petitioner maintains that the respondents petition for certiorari, prohibition
and mandamus before the Court of Appeals should have been dismissed because he failed to implead the real party-in-interest as
mandated by Rule 3, Section 7 of the Rules of Court, as amended; in this case, the BOC. According to the Solicitor General, this was a fatal
procedural error. The inclusion of the BOC as respondent in the case was necessary in order that its actions could be directly attacked and
for the court to acquire jurisdiction over it. The fact that Immigration Commissioner Andrea T. Domingo was impleaded as the sole
respondent was not enough, as she is only one of the four Commissioners.Furthermore, the assailed Orders were issued by the Board, and
not by the Immigration Commissioner alone.
The respondent counters that the petitioner is already estopped from raising this issue. He argues that -
In quite a number of jurisprudence, only the Immigration Commissioner is impleaded to decide whether an alien may stay here or not.
The bottom line is petitioner, head of the Bureau of Immigration, was more than fully heard on its institutional position, a Bureau which
speaks with a single voice in this case. She is in estoppel for not raising the issue earlier, either in a timely Comment or during the oral
argument[41]
In Caruncho III v. Comelec, it was held that-
[O]rdinarily, the nonjoinder of an indispensable party or real party in interest is not by itself a ground for the dismissal of the petition. The
court before which the petition is filed must first require the joinder of such party. It is the noncompliance with said order that would be a
ground for the dismissal of the petition.
But even as the Court of Appeals did not require respondent of such joinder of parties, the respondent, in fact, begged leave, ad cautelam,
in its Reply Memorandum dated July 31, 2002 to implead the Board which speaks with a single voice anyway in this case, and therefore,
no claim can be made that a valid point of view has not been heard[42]
Moreover, according to the respondent, the petitioner is clearly the BIDs chosen instrumentality for the relevant purpose. What
the respondent ultimately questioned are the acts or orders of the petitioner for the arrest and immediate deportation of the respondent
by way of implementing the BOCs Summary Deportation Order.
By way of reply, the Office of the Solicitor General asserted that the Summary Deportation Order and Omnibus Resolution were
collegial actions of the BOC and not of the petitioner alone. Although its Chairperson, the petitioner, is merely a member thereof, her
decisions and actions are still subject to the collective will of the majority.[43]
The Ruling of the Court
The BOC is an
Indispensable
Party
We agree with the petitioners contention that the BOC was an indispensable party to the respondents petition for certiorari,
prohibition and mandamus in the Court of Appeals. The respondent was arrested and detained on the basis of the Summary Deportation
Order of the BOC. The petitioner caused the arrest of the respondent in obedience to the said Deportation Order. The respondent, in his
Memorandum, prayed that the CA annul not only the Summary Deportation Order of the BOC but also the latters Omnibus Resolution,
and, thus, order the respondents immediate release. The respondent also prayed that the CA issue a writ of mandamus for the immediate
resolution of his Urgent Motion for Reconsideration. The said motion had to be resolved by the BOC as the order sought to be resolved
and reconsidered was issued by it and not by the petitioner alone. The powers and duties of the BOC may not be exercised by the
individual members of the Commission.[44]
Section 7, Rule 3 of the Rules of Court, as amended, requires indispensable parties to be joined as plaintiffs or defendants. The
joinder of indispensable parties is mandatory. Without the presence of indispensable parties to the suit, the judgment of the court cannot
attain real finality.[45] Strangers to a case are not bound by the judgment rendered by the court.[46] The absence of an indispensable party
renders all subsequent actions of the court null and void. Lack of authority to act not only of the absent party but also as to those
present.[47] The responsibility of impleading all the indispensable parties rests on the petitioner/plaintiff.[48]
However, the non-joinder of indispensable parties is not a ground for the dismissal of an action. Parties may be added by order of
the court on motion of the party or on its own initiative at any stage of the action and/or such times as are just. [49] If the
petitioner/plaintiff refuses to implead an indispensable party despite the order of the court, the latter may dismiss the complaint/petition
for the petitioner/plaintiffs failure to comply therefor.[50] The remedy is to implead the non-party claimed to be indispensable.[51] In this
case, the CA did not require the respondent (petitioner therein) to implead the BOC as respondent, but merely relied on the rulings of the
Court in Vivo v. Arca,[52] and Vivo v. Cloribel.[53] The CAs reliance on the said rulings is, however, misplaced. The acts subject of the petition
in the two cases were those of the Immigration Commissioner and not those of the BOC; hence, the BOC was not a necessary nor even an
indispensable party in the aforecited cases.
The Non-joinder of an
Indispensable Party is not
a Ground for the Dismissal
of the Petition
The Court may be curing the defect in this case by adding the BOC as party-petitioner. The petition should not be dismissed
because the second action would only be a repetition of the first.[54] In Salvador, et al., v. Court of Appeals, et al., [55] we held that this Court
has full powers, apart from that power and authority which is inherent, to amend the processes, pleadings, proceedings and decisions by
substituting as party-plaintiff the real party-in-interest. The Court has the power to avoid delay in the disposition of this case, to order its
amendment as to implead the BOC as party-respondent. Indeed, it may no longer be necessary to do so taking into account the unique
backdrop in this case, involving as it does an issue of public interest.[56] After all, the Office of the Solicitor General has represented the
petitioner in the instant proceedings, as well as in the appellate court, and maintained the validity of the deportation order and of the
BOCs Omnibus Resolution. It cannot, thus, be claimed by the State that the BOC was not afforded its day in court, simply because only the
petitioner, the Chairperson of the BOC,[57] was the respondent in the CA, and the petitioner in the instant recourse. In Alonso v.
Villamor,[58] we had the occasion to state:
There is nothing sacred about processes or pleadings, their forms or contents. Their sole purpose is to facilitate the application of justice
to the rival claims of contending parties. They were created, not to hinder and delay, but to facilitate and promote, the administration of
justice. They do not constitute the thing itself, which courts are always striving to secure to litigants. They are designed as the means best
adapted to obtain that thing. In other words, they are a means to an end. When they lose the character of the one and become the other,
the administration of justice is at fault and courts are correspondingly remiss in the performance of their obvious duty.
The CA had Jurisdiction
Over the Petition for
Certiorari, Prohibition
and Mandamus
We do not agree with the petitioners contention that the issue before the CA, as to the power of the President to determine
whether an alien may remain or be deported from the Philippines, is beyond the appellate courts competence to delve into and
resolve. The contention of the petitioner is based on a wrong premise.
The settled rule is that the authority to exclude or expel aliens by a power affecting international relation is vested in the political
department of the government, and is to be regulated by treaty or by an act of Congress, and to be executed by the executive authority
according to the regulations so established, except in so far as the judicial department has been authorized by treaty or by statute, or is
required by the Constitution to intervene.[59] The judicial department cannot properly express an opinion upon the wisdom or the justice
of the measures executed by Congress in the exercise of the power conferred on it,[60] by statute or as required by the Constitution.
Congress may, by statute, allow the decision or order of the Immigration Commissioner or the BOC to be reviewed by the President of the
Philippines or by the courts, on the grounds and in the manner prescribed by law.
Article VIII, Section 1 of the Constitution has vested judicial power in the Supreme Court and the lower courts such as the Court of
Appeals, as established by law. Although the courts are without power to directly decide matters over which full discretionary authority
has been delegated to the legislative or executive branch of the government and are not empowered to execute absolutely their own
judgment from that of Congress or of the President,[61] the Court may look into and resolve questions of whether or not such judgment
has been made with grave abuse of discretion, when the act of the legislative or executive department violates the law or the
Constitution. In Harvy Bridges v. I.F. Wixon,[62] the United States Federal Supreme Court reversed an Order of Deportation made by the
Attorney General for insufficiency of evidence and for improper admission of evidence. In Nging v. Nagh,[63] the United States Court of
Appeals (9th Circuit Court) held that conclusions of administrative offices on the issues of facts are invulnerable in courts unless when they
are not rendered by fair-minded men; hence, are arbitrary. In Toon v. Stump,[64] the Court ruled that courts may supervise the actions of
the administrative offices authorized to deport aliens and reverse their rulings when there is no evidence to sustain them. When acts or
omissions of a quasi-judicial agency are involved, a petition for certiorari or prohibition may be filed in the Court of Appeals as provided by
law or by the Rules of Court, as amended.[65]
In this case, the respondent alleges that the petitioner acted arbitrarily, contrary to law and with grave abuse of discretion in
causing his arrest and detention at a time when his Urgent Motion for Reconsideration of the BOCs Summary Deportation Order had yet
to be resolved. There was no factual or legal basis for his deportation considering that he was a documented alien and a law-abiding
citizen; the respondent, thus, prayed for a writ of mandamus to compel the petitioner, the Chairperson of the BOC, to resolve the said
motion. The petition before the CA did not involve the act or power of the President of the Philippines to deport or exclude an alien from
the country. This being so, the petition necessarily did not call for a substitution of the Presidents discretion on the matter of the
deportation of the respondent with that of the judgment of the CA.
Irrefragably, the CA had jurisdiction over the petition of the respondent.
The BOC Committed a Grave
Abuse of Discretion Amounting
To Lack or Excess of Jurisdiction
In Issuing its Summary Deportation
Order and Omnibus Resolution; The
Petitioner Committed a Grave Abuse
Of Her Discretion Amounting to
Lack or Excess of Jurisdiction in
Causing the Arrest and Detention
Of The Private Respondent
On the Solicitor Generals fourth and fifth arguments, we are convinced that the BOC committed a grave abuse of discretion
amounting to excess or lack of jurisdiction in issuing its Summary Deportation Order and Omnibus Resolution, and that the petitioner
committed grave abuse of discretion amounting to excess or lack of jurisdiction in causing the arrest and detention of the private
respondent.
The settled rule is that the entry or stay of aliens in the Philippines is merely a privilege and a matter of grace; such privilege is not
absolute nor permanent and may be revoked. However, aliens may be expelled or deported from the Philippines only on grounds and in
the manner provided for by the Constitution, the Immigration Act of 1940, as amended, and administrative issuances pursuant
thereto. In Mejoff v. Director of Prisons,[66] we held, thus:
Moreover, by its Constitution (Art. II, Sec. 3) the Philippines adopts the generally accepted principles of international law a part of the law
of Nation. And in a resolution entitled Universal Declaration of Human Rights and approved by the General Assembly of the United
Nations of which the Philippines is a member, at its plenary meeting on December 10, 1948, the right to life and liberty and all other
fundamental rights as applied to all human beings were proclaimed. It was there resolved that All human beings are born free and equal
in degree and rights (Art. 1); that Everyone is entitled to all the rights and freedom set forth in this Declaration, without distinction of any
kind, such as race, color, sex, language, religion, political or other opinion, nationality or social origin, property, birth, or other status (Art.
2); that Every one has the right to an effective remedy by the competent national tribunals for acts violating the fundamental rights
granted him by the Constitution or by law (Art. 8); that No one shall be subjected to arbitrary arrest, detention or exile (Art. 9); etc.
In this case, the BOC ordered the private respondents deportation on September 27, 1995 without even conducting summary
deportation proceedings. The BOC merely relied on the June 29, 1995 Letter of the German Vice Consul and of the German Embassys
Note Verbale No. 369/95 dated July 26, 1995. It issued the Summary Deportation Order on September 27, 1995 allegedly under paragraph
3 of Office Memorandum Order No. 34 dated August 21, 1989 which reads:
3. If a foreign embassy cancels the passport of the alien or does not reissue a valid passport to him, the alien loses the privilege to remain
in the country, under the Immigration Act, Sections 10 and 15 (Schonemann vs. Santiago, et al., G.R. No. 81461, 30 May 1989). The
automatic loss of the privilege obviates deportation proceedings. In such instance, the Board of Commissioners may issue summary
judgment of deportation which shall be immediately executory.
However, as gleaned from the Summary Deportation Order, the respondent was ordered deported not only because his passport
had already expired; the BOC speculated that the respondent committed insurance fraud and illegal activities in the Philippines and would
not, thus, be issued a new passport. This, in turn, caused the BOC to conclude that the respondent was an undesirable alien. Section 37(c)
of Commonwealth Act No. 613, as amended, provides that:
No alien shall be deported without being informed of the specific grounds for deportation or without being given a hearing under rules of
procedure to be prescribed by the Commissioner of Immigration.
Under paragraphs 4 and 5 of Office Memorandum Order No. 34, an alien cannot be deported unless he is given a chance to be
heard in a full deportation hearing, with the right to adduce evidence in his behalf, thus:
4. All other cases shall be tried in full deportation hearing, with due observance of the pertinent provisions of Law Instruction No. 39.
5. In all cases, the right of the alien to be informed of the charges against him, to be notified of the time and place of hearing, when
necessary, to examine the evidence against him, and to present evidence in his own behalf, where appropriate, shall be observed.
The respondent was not afforded any hearing at all. The BOC simply concluded that the respondent committed insurance fraud and
illegal activities in Palawan without any evidence. The respondent was not afforded a chance to refute the charges. He cannot, thus, be
arrested and deported without due process of law as required by the Bill of Rights of the Constitution.In Lao Gi v. Court of Appeals,[67] we
held that:
Although a deportation proceeding does not partake of the nature of a criminal action, however, considering that it is a harsh and
extraordinary administrative proceeding affecting the freedom and liberty of a person, the constitutional right of such person to due
process should not be denied. Thus, the provisions of the Rules of Court of the Philippines particularly on criminal procedure are
applicable to deportation proceedings.
It must be noted that the respondent was a permanent resident before his passport expired on July 2, 1995. In Chew v.
Colding,[68] the United States Federal Supreme Court ruled:
It is well established that if an alien is a lawful permanent resident of the United States and remains physically present there, he is a
person within the protection of the Fifth Amendment. He may not be deprived of his life, liberty or property without due process of
law. Although it later may be established, as respondents contend, that petitioner can be expelled and deported, yet before his expulsion,
he is entitled to notice of the nature of the charge and a hearing at least before an executive or administrative tribunal. Although
Congress may prescribe conditions for his expulsion and deportation, not even Congress may expel him without allowing him a fair
opportunity to be heard.
As Mr. Justice Murphy said in his concurring opinion in Bridges v. Wixon:[69]
The Bill of Rights belongs to them as well as to all citizens. It protects them as long as they reside within the boundaries of our land. It
protects them in the exercise of the great individual rights necessary to a sound political and economic democracy.
According to Vattal,[70] an alien who is a permanent resident in a country is a member of the new society, at least as a permanent
inhabitant, and is a kind of citizen of inferior order from the native citizens; but is, nevertheless, limited and subject to the society, without
participating in all its advantages. Sir Robert Philconse called them de facto, though not de jure citizens of the country of their domicile.[71]
Such permanent resident[72] may be classified as a denizen, a kind of middle state between alien and a natural-born subject and
partakes of both. Paraphrasing Justice Brewer in his dissenting opinion in Fong Yue Ting v. United States,[73] when the right to liberty and
residence is involved, some other protection than the mere discretion of the petitioner or the BOC is required. We recall the warning of
the United States Supreme Court in Boyd v. United States:[74]
Illegitimate and unconstitutional practices get their first footing in that way, namely, by silent approaches and slight deviations from legal
modes of procedure. This can only be obviated by adhering to the rule that constitutional provisions for the security of person and
property should be liberally construed. A close and literal construction deprives them of half their efficacy, and leads to a gradual
depreciation of the right, as if it consisted more in sound than in substance. It is the duty of the courts to be watchful for the
constitutional rights of the citizen, and against any stealthy encroachments thereon. Their motto should be obsta principiis.
In sum, the arrest and detention of the respondent and his deportation under the Summary Deportation Order of the BOC for
insurance fraud and illegal activities in Palawan violated his constitutional and statutory rights to due process.
The Respondents Arrest and
Detention was Premature,
Unwarranted and Arbitrary
We agree that the Immigration Commissioner is mandated to implement a legal and valid Summary Deportation Order within a
reasonable time. But in this case, the arrest of the respondent in his house, at near midnight, and his subsequent detention was
premature, unwarranted and arbitrary. Like a thunderbolt in the sky, the BID agents and marines arrested the respondent on June 6,
2002, on orders of the petitioner based on the September 27, 1995 Summary Deportation Order. Under the basic rudiments of fair play
and due process, the petitioner was required to first resolve the respondents Urgent Motion for Reconsideration of the said Order, which
was filed more than six years before or on December 5, 1995.
It may be argued that respondents filing of an Urgent Motion for Reconsideration did not ipso facto suspend the efficacy of the
BOCs deportation order. However, such an argument cannot be sustained in this case because of the extant and peculiar factual milieu. It
bears stressing that more than six years had elapsed, from the time the Summary Deportation Order was issued, until the respondent was
finally arrested. Supervening facts and circumstances rendered the respondents arrest and detention unjust, unreasonable, barren of
factual and legal basis. The BOC should have set the respondents motion for hearing to afford him a chance to be heard and adduce
evidence in support thereon. It was bad enough that the BOC issued its Summary Deportation Order without a hearing; the BOC dealt the
respondent a more severe blow when it refused to resolve his motion for reconsideration before causing his arrest on June 6, 2002.
As aforestated, the BOC ordered the deportation of the respondent after a summary proceeding without prior notice on the
following grounds: (a) the respondents German passport had expired; (b) there was a pending criminal case for physical injuries against
him in Germany; (c) the respondent indulged in illegal activities in Palawan; (d) that in all likelihood, the respondents passport will not be
renewed by the German Embassy as he was wanted for insurance fraud in Germany; and, (e) he was an undesirable alien. But then, in
response to the written query of no less than the petitioner herself, the German Embassy declared that the respondent was not wanted
by the German police for any crime, including insurance fraud. This could only mean that the warrant of arrest issued by the German
Federal police mentioned in Note Verbale No. 369/95 had been lifted, and that the respondent was not involved in any illegal activities in
Germany. The criminal case against the respondent for physical injuries, which does not involve moral turpitude, was dismissed by the
German District Court.Furthermore, there was no evidence of insurance fraud against the respondent.
The BOC issued its Summary Deportation Order without affording the respondent the right to be heard on his motion and adduce
evidence thereon. It merely concluded that the respondent was involved in illegal activities in Palawan. What made matters worse was
that the BOC indulged in sheer speculation, that the German Embassy is unlikely to issue a new passport to the respondent. The
deportation of aliens should not be based on mere speculation or a mere product of procrastinations as in this case. As it turned out, the
German Embassy re-issued the respondents passport; he was issued a temporary passport, and, thereafter, a regular passport, yet to
expire on March 12, 2006. The petitioner cannot feign ignorance of this matter because the respondent himself, six years before he was
arrested, informed then Immigration Commissioner Verceles in a Letter dated March 1, 1996. The respondents letter forms part of the
records of the BOC. There is no evidence on record that the respondent committed any illegal activities in Palawan. He was even
designated as special agent of the NBI, and was, in fact, issued clearances by the PNP and the NBI no less. Despite all the foregoing, the
petitioner ordered and caused the arrest and detention of the respondent.
What is most nettlesome is the apparent antedating of the BOC Omnibus Resolution. The records show that the petitioner sought
to assuage the respondents concern on the belated resolution of his pending urgent motion for reconsideration in a Letter to the latters
counsel dated July 18, 2002 in which the petitioner assured the respondent that the BOC will provide him of its action on the said motion:
Dear Atty. Sagisag,
We respond to your letter of 17 June 2002 by informing you that the case of Mr. Herbert Scheer is being evaluated by the Board of
Commissioners (BOC). The BOC will provide you of the results of its collegial action in due time.
Very truly
yours,
(Sgd.) ANDREA D.
DOMINGO
Commissi
oner[75]
However, the Omnibus Resolution of the BOC was dated June 14, 2002, although on its face it was filed with the Records Division of
the BID only on July 18, 2002.
The foregoing gave reason for the CA to suspect that the Omnibus Resolution of the BOC was antedated. [76] The petition of the
respondent in the CA must have jolted the petitioner and the BOC from its stupor because it came out with its Omnibus Resolution on July
18, 2002, which was, however, dated as early as June 14, 2002. The respondent had to wait in anxiety for the BOC to quench his quest for
justice. The BOCs wanton acts amounted to an abdication of its duty to act and/or resolve cases/incidents with reasonable dispatch. To
recall our ruling in Board of Commissioners v. De la Rosa,[77] citing Sheor v. Bengson,[78] thus:
This inaction or oversight on the part of the immigration officials has created an anomalous situation which, for reasons of equity, should
be resolved in favor of the minor herein involved.
The petitioner and the BOC should have taken to heart the following pronouncement in Commissioner of Immigration v.
Fernandez:[79]
In the face of the disclosure that Teban Caoili had been all along working in the Avenue Electrical Supply Co. (Avesco), located at No. 653
Rizal Avenue, Manila, until his arrest, and the documentary evidence showing that he had been issued a Philippine Passport; had regularly
paid his Residence Tax Certificates (A & B), and filed Income Tax Returns, a finding of fact is necessary whether the Commissioner really
had intended to notify Teban Caoili of the exclusion proceedings the Board had conducted in his absence. While it may be true that the
proceedings is purely administrative in nature, such a circumstance did not excuse the serving of notice. There are cardinal primary rights
which must be respected even in proceedings of administrative character, the first of which is the right of the party interested or affected
to present his own case and submit evidence in support thereof.[80]
...
Since the proceedings affected Caoilis status and liberty, notice should have been given. And in the light of the actuations of the new
Board of Commissioners, there is a necessity of determining whether the findings of the Board of Special Inquiry and the old Board of
Commissioners are correct or not. This calls for an examination of the evidence, and, the law on the matter.[81]
Apparently, the BOC did not bother to review its own records in resolving the respondents Urgent Motion for Reconsideration. It
anchored its Omnibus Resolution only on the following: the membership of the BOC had changed when it issued its September 27, 1995
Summary Deportation Order and under Commonwealth Act No. 613, Section 27(b); the BOC is precluded from reversing a previous order
issued by it;[82]and, the September 27, 1995 Order of the BOC had become final and could no longer be reviewed and reversed by it after
the lapse of one year.[83] However, the rulings cited by the petitioner are not applicable in the instant case, as the said cases cited involve
appeals to the BOC from the decisions of the Board of Special Inquiry (BSI). In Sy v. Vivo[84] and Lou v. Vivo,[85] we ruled that under Section
27(b) of Commonwealth Act No. 613, as amended, the Decision of the BOC on appeal from the decision of the BSI becomes final and
executory after one year:
(b) A board of special inquiry shall have authority (1) to determine whether an alien seeking to enter or land in the Philippines shall be
allowed to enter or land or shall be excluded, and (2) to make its findings and recommendations in all the cases provided for in section
twenty-nine of this Act wherein the Commissioner of Immigration may admit an alien who is otherwise inadmissible. For this purpose, the
board or any member thereof, may administer oaths and take evidence and in case of necessity may issue subpoena and/or
subpoena duces tecum. The hearing of all cases brought before a board of special inquiry shall be conducted under rules of procedure to
be prescribed by the Commissioner of Immigration. The decision of any two members of the board shall prevail and shall be final unless
reversed on appeal by the Board of Commissioners as hereafter stated, or in the absence of an appeal, unless reversed by the Board of
Commissioners after a review by it, motu propio, of the entire proceedings within one year from the promulgation of the decision.
In Commissioner of Immigration v. Fernandez,[86] we held that the BOC composed of new members is precluded from
reversing, motu proprio, the decision of the BOC on appeal from a BSI decision. But not to be ignored was our ruling that at any rate, the
issue of authority should be made in accordance with the procedure established by law, with a view to protecting the rights of
individuals.[87]
In this case, the Summary Deportation Order was issued by the BOC in the exercise of its authority under Office Memorandum
Order No. 34, and not in the exercise of its appellate jurisdiction of BSI decisions. There is no law nor rule which provides that a Summary
Deportation Order issued by the BOC in the exercise of its authority becomes final after one year from its issuance, [88] or that the
aggrieved party is barred from filing a motion for a reconsideration of any order or decision of the BOC. The Rules of Court may be applied
in a suppletory manner to deportation proceedings[89] and under Rule 37, a motion for reconsideration of a decision or final order may be
filed by the aggrieved party.
Neither is there any law nor rule providing that the BOC, composed of new members, cannot revise a Summary Deportation Order
previously issued by a different body of Commissioners. The BOC that issued the Summary Deportation Order and the BOC which resolved
the respondents Urgent Motion for Reconsideration are one and the same government entity, with the same powers and duties
regardless of its membership. Similarly, an RTC judge who replaces another judge who presided over a case may review the judgment or
order of his predecessor as long as the said judgment or order has not as yet become final or executory. The act subject of review is not
the act of the judge but the act of the court.
The petitioners contention that it failed to resolve the respondents motion for reconsideration because of the change of
administration in the BOC was branded by the CA as flimsy, if not bordering on the absurd:
Firstly, it was issued three days (June 14, 2002) after petitioner filed this instant petition on June 11, 2002 or almost seven years from the
time the motion for reconsideration was filed;
Secondly, respondents counsels excuse that it took such time to resolve it because it was only later that the motion for reconsideration
was discovered because of change of administration, is flimsy, if not bordering on the absurd;[90]
The Issuance of a New and Regular
Passport to the Respondent
Rendered the Summary
Deportation Order Moot and
Academic, and the Omnibus
Resolution of the BOC Lacking
in Legal Basis
We agree with the petitioner that a foreign embassys cancellation of the passport it had issued to its citizens, or its refusal to issue
a new one in lieu of a passport that has expired, will result in the loss of the aliens privilege to stay in this country and his subsequent
deportation therefrom. But even the BOC asserted in its Summary Deportation Order that an embassys issuance of a new passport to any
of its citizens may bar the latters deportation, citing the resolution of this Court in Schonemann v. Commissioner Santiago. [91]
Irrefragably, Commissioner Verceles was mandated to cause the arrest of the respondent preparatory to his deportation from the
Philippines. However, there was no fixed period in the Order within which to comply with the same. The Commissioner is not mandated
to deport an alien immediately upon receipt of the BOCs deportation order. It is enough that the Commissioner complies with the Order
within a reasonable time, which, in Mejoff v. Director of Prisons,[92] we held to connote as follows:
The meaning of reasonable time depends upon the circumstances, specially the difficulties of obtaining a passport, the availability of
transportation, the diplomatic arrangements with the governments concerned and the efforts displayed to send the deportee away; but
the Court warned that under established precedents, too long a detention may justify the issuance of a writ of habeas corpus.
In this case, the BOC had yet to act on the respondents Urgent Motion for Reconsideration. The respondent was also given a
chance to secure a clearance and a new passport with the German Embassy. After all, the possibility that the German Embassy would
renew the respondents passport could not be ruled out. This was exactly what happened: the German Embassy issued a new passport to
the respondent on March 12, 1996 after the German District Court dismissed the case for physical injuries. Thus, the respondent was no
longer an undocumented alien; nor was he an undesirable one for that matter.
The petitioner even admits that there is no longer a legal or factual basis to disqualify the respondent from remaining in the
country as a permanent resident. Yet, the OSG insists that he has to be deported first so that the BOCs Summary Deportation Order could
be implemented. This contention was rejected by the CA, thus:
During the hearing of petitioners prayer for issuance of a writ of preliminary injunction before Us, respondents counsel from the Office of
the Solicitor General had the occasion to manifest in open court that the State has no opposition to petitioners stay in the
country provided he first leave and re-enter and re-apply for residency if only to comply with the Summary Deportation Order of 1995.
That, to Our mind, seems preposterous, if not ridiculous. An individuals human rights and rights to freedom, liberty and self-
determination recognize no boundaries in the democratic, free and civilized world. Such rights follow him wherever he may
be. If presently, there is no factual or legal impediment to disqualify petitioner in his stay in the country, other than allegedly those relied
upon in the Summary Deportation Order of 1995 (as hereinbefore discussed, had ceased to exist), requiring petitioner to leave the
country and re-enter and re-apply for residency makes little sense or no sense at all, more so, in the case of petitioner who, for many
years past, had lived herein and nurtured a family that is Filipino.
Thus, opined, We, therefore, believe and hereby rule, that there is presently every reason to enjoin/prohibit the Bureau of Immigration,
respondent Commissioner Domingo in particular, from presently deporting petitioner.[93]
We agree with the Court of Appeals. The Summary Deportation Order had been rendered moot and academic upon the German
Embassys issuance of a new passport to the respondent. The respondent had been in the Philippines as a permanent resident since July
18, 1986, and had married a Filipino citizen, with whom he has two children. He is not a burden to the country nor to the people of
Palawan. He put up, and has been managing, the Bavaria Restaurant with about 30 employees. He has no pending criminal case; nor does
he have any derogatory record. The respondent was allowed by then Immigration Commissioner Verceles to renew his passport and was
given time to secure a clearance from the German Embassy.The respondent was able to do so. The case against him for physical injuries
was dismissed by the German District Court. Thus, the inceptual basis for the respondents deportation had ceased to exist.
The power to deport is a police matter against undesirable aliens, whose presence in the country is found to be injurious to the
public good. We believe that the deportation of the respondent late in the day did not achieve the said purpose. The petitioner admitted
that there is no longer a factual and legal basis to disqualify the respondent from staying in the country.He is not an undesirable alien; nor
is his presence in the country injurious to public good. He is even an entrepreneur and a productive member of society.
Arrest, detention and deportation orders of aliens should not be enforced blindly and indiscriminately, without regard to facts and
circumstances that will render the same unjust, unfair or illegal.[94] To direct the respondent to leave the country first before allowing him
re-entry is downright iniquitous.[95] If the respondent does leave the country, he would thereby be accepting the force and effect of the
BOCs Summary Deportation Order with its attendant infirmities. He will thereby lose his permanent resident status and admit the efficacy
of the cancellation of his permanent resident visa. Moreover, his entry into the country will be subject to such conditions as the petitioner
may impose.
The deportation of an alien is not intended as a punishment or penalty. But in a real sense, it is. In Bridges v. Wixon,[96] Mr. Justice
Murphy declared that the impact of deportation upon the life of an alien is often as great if not greater than the imposition of a criminal
sentence. In dealing with deportation, there is no justifiable reason for disregarding the democratic and human tenets of our legal system
and descending to the practices of despotism. As Justice Brewer opined in Fong Yue Ting v. United States,[97] deportation is a punishment
because it requires first, an arrest, a deprivation of liberty and second, a removal from home, from family, from business, from
property. To be forcibly taken away from home, family, business and property and sent across the ocean to a distant land is punishment;
and that oftentimes is most severe and cruel. It would be putting salt on the respondents woes occasioned by the BOCs
ineptitude. Considering the peculiar backdrop and the equities in this case, the respondents deportation and the cancellation of his
permanent resident visa as a precondition to his re-entry into this country is severe and cruel; it is a form of punishment.
Our ruling in Vivo v. Cloribel,[98] has no application in this case, precisely because the factual milieu here is entirely different. In that
case, the Commissioner of Immigration required the respondents to leave the country on or before September 12, 1962, because their
stay in the country as approved by the Secretary of Justice had been cancelled. Our ruling in Bing v. Commission on Immigration,[99] even
buttresses the case for the respondent since we ruled therein that an alien entitled to a permanent stay cannot be deported without
being accorded due notice and hearing.
IN LIGHT OF ALL THE FOREGOING, the petition is DENIED. The Decision of the Court of Appeals is AFFIRMED.
SO ORDERED.
Puno, (Chairman), Quisumbing, Austria-Martinez, and Tinga, JJ., concur.
EUFEMIO C. DOMINGO, CELSO D. GANGAN, PACASIO S. BANARIA, SOFRONIO B. URSAL, ALBERTO P. CRUZ, MARIA L. MATIB, RACHEL U.
PACPACO, ANGELO G. SANCHEZ, and SHERWIN A. SIP-AN, petitioners, vs. HON. GUILLERMO N. CARAGUE, in his capacity as
Chairman, Commission on Audit, HON. EMMANUEL M. DALMAN and HON. RAUL C. FLORES, in their capacities as
Commissioners, Commission on Audit, respondents.
DECISION
SANDOVAL-GUTIERREZ, J.:
 Judicial power is the power to hear and decide cases pending between parties who have the right to sue in courts of law and
equity.[1] Corollary to this dictum is the principle of locus standi of a litigant. He who is directly affected and whose interest is immediate
and substantial has the standing to sue. Thus, a party must show a personal stake in the outcome of the case or an injury to himself that
can be redressed by a favorable decision in order to warrant an invocation of the courts jurisdiction and justify the exercise of judicial
power on his behalf.
Assailed in this petition for certiorari is the legality of Resolution No. 2002-05 of the Commission on Audit (COA) providing for
Organizational Restructuring Plan. The above-named petitioners basically alleged therein that this Plan is intrinsically void for want of an
enabling law authorizing COA to undertake the same and providing for the necessary standards, conditions, restrictions, limitations,
guidelines, and parameters. Petitioners further alleged that in initiating such Organizational Restructuring Plan without legal authority,
COA committed grave abuse of discretion amounting to lack or excess of jurisdiction.
At this point, it is pertinent to state that the COA is a quasi-judicial body and that its decision, order or ruling may be brought to the
Supreme Court on certiorari by the aggrieved party.[2]
Petitioners Eufemio C. Domingo, Celso C. Gangan, Pascasio S. Banaria are retired Chairmen, while Sofronio B. Ursal, and Alberto P.
Cruz are retired Commissioners of COA. All claim to maintain a deep-seated abiding interest in the affairs of COA,[3] especially in its
Organizational Restructuring Plan, as concerned taxpayers.
The other petitioners are incumbent officers or employees of COA. Maria L. Matib and Angelo G. Sanchez are State Auditor III and
State Auditor II, respectively, assigned to the Cordillera Administrative Region (CAR). Prior to the implementation of the questioned COA
Organizational Restructuring Plan, they were Resident Auditors and later Audit Team Leaders. Petitioner Rachel U. Pacpaco is a State
Auditor III assigned to CAR and a Team Supervisor, while petitioner Sherwin A. Sipi-an is a State Auditor I also assigned at the CAR. These
petitioners claim that they were unceremoniously divested of their designations/ranks as Unit Head, Team Supervisor, and Team Leader
upon implementation of the COA Organizational Restructuring Plan without just cause and without due process, in violation of Civil
Service Law. Moreover, they were deprived of their respective Representation and Transportation Allowances (RATA), thus causing them
undue financial prejudice.
Petitioners now invoke this Courts judicial power to strike down the COA Organizational Restructuring Plan for being
unconstitutional or illegal.
Initially, for our resolution is the issue of whether petitioners have the legal standing to institute the instant petition.
Petitioners invoke our ruling in Chavez v. Public Estates Authority,[4] Agan, Jr. v. Philippine International Air Terminals Co.,
Inc.,[5] and Information Technology Foundation of the Philippines v. Commission on Elections[6] that where the subject matter of a case is a
matter of public concern and imbued with public interest, then this fact alone gives them legal standing to institute the instant petition.
Petitioners contend that the COA Organizational Restructuring Plan is not just a mere reorganization but a revamp or overhaul of the COA,
with a spillover effect upon its audit performance. This will have an impact upon the rest of the government bodies subject to its audit
supervision, thus, should be treated as a matter of transcendental importance. Consequently, petitioners legal standing should be
recognized and upheld.
Respondents, through the Office of the Solicitor General (OSG), counter that petitioners have no legal standing to file the present
petition since following our ruling in Kilusang Mayo Uno Labor Center v. Garcia, Jr.,[7] they have not shown a personal stake in the
outcome of the case or an actual or potential injury that can be redressed by our favorable decision. Petitioners themselves admitted that
they do not seek any affirmative relief nor impute any improper or improvident act against the said respondents and are not motivated by
any desire to seek affirmative relief from COA or from respondents that would redound to their personal benefit or gain. It is clear then
that petitioners failed to show any present substantial interest in the outcome of this case, citing Kilosbayan v. Morato.[8] Nor may
petitioners claim that as taxpayers, they have legal standing since nowhere in their petition do they claim that public funds are being
spent in violation of law or that there is a misapplication of the taxpayers money, as we ruled in Dumlao v. Comelec.[9]
Petitioners reliance upon our rulings in Chavez,[10] Agan, Jr.,[11] and Information Technology Foundation[12] is flawed.
In Chavez, we ruled that the petitioner has legal standing since he is a taxpayer and his purpose in filing the petition is to compel
the Public Estate Authority (PEA) to perform its constitutional duties with respect to: (a) the right of the citizens to information on matters
of public concern; and (b) the application of a constitutional provision intended to insure the equitable distribution of alienable lands of
the public domain among Filipino citizens. The thrust of the first is to compel PEA to disclose publicly information on the sale of
Government lands worth billions of pesos, as mandated by the Constitution and statutory law. The thrust of the second is to prevent PEA
from alienating hundreds of hectares of alienable lands of the public domain, thereby compelling it to comply with a constitutional duty to
the nation. We held that these matters are of transcendental public importance.[13]
In Agan, Jr., we held that petitioners have legal standing as they have a direct and substantial interest to protect. By the
implementation of the PIATCO contracts, they stand to lose their source of livelihood, a property right zealously protected by the
Constitution. Such financial prejudice on their part is sufficient to confer upon them the requisite locus standi.[14]
In Information Technology Foundation, there were two reasons why petitioners standing was recognized. First, the nations political
and economic future virtually hangs in the balance, pending the outcome of the 2004 elections. Accordingly, the award for the
automation of the electoral process was a matter of public concern, imbued with public interest. Second, the individual petitioners, as
taxpayers, asserted a material interest in seeing to it that public funds are properly used.
Here, petitioners have not shown any direct and personal interest in the COA Organizational Restructuring Plan. There is no
indication that they have sustained or are in imminent danger of sustaining some direct injury as a result of its implementation. In fact,
they admitted that they do not seek any affirmative relief nor impute any improper or improvident act against the respondents and are
not motivated by any desire to seek affirmative relief from COA or from respondents that would redound to their personal benefit or gain.
Clearly, they do not have any legal standing to file the instant suit.
We are well aware of the averments of petitioners Matib, Pacpaco, Sanchez, and Sipi-An that they were demoted and
unceremoniously divested of their previous designations as Unit Head, Team Supervisor, or Team Leader; that they were deprived of their
RATA; that they were relegated to being mere Team Members, entitled to only a reimbursable transportation allowance; and that they
were denied due process.
Such averments lack merit. Actually, they were not demoted. Under Section 11, Rule VII of the Omnibus Rules Implementing Book
V of the Administrative Code of 1987, a demotion is the movement from one position to another involving the issuance of an
appointment with diminution in duties, responsibilities, status, or rank which may or may not involve reduction in salary. [15] A demotion
by assigning an employee to a lower position in the same service which has a lower rate of compensation is tantamount to removal, if no
cause is shown for it.[16]
Here, there have been no new appointments issued to Matib, Pacpaco, Sanchez, and Sipi-An under the COA Organizational
Restructuring Plan. Thus, their contention that they have been demoted is baseless.
Moreover, the change in their status from COA auditors (receiving monthly RATA) to COA auditors (receiving only reimbursable
RATA) cannot be attributed to the COA Organizational Restructuring Plan but to the implementation of the Audit Team Approach (ATAP),
pursuant to COA Resolution No. 96-305 dated April 16, 1996.
Under the ATAP, an audit team, not a resident auditor, is deployed to conduct an audit. An audit team may be composed of two (2)
or more members under an Audit Team Leader. Whenever practicable, an Audit Team Supervisor supervises at least three (3) audit teams.
The composition of an audit team is not permanent. Hence, an Audit Team Member may be designated or assigned as an Audit Team
Leader for one assignment and subsequently as a Team Member in another engagement. The designation depends upon the position or
rank of the one who is designated as an Audit Team Leader. Thus, a State Auditor III who may have been assigned as an Audit Team
Leader in one engagement may find himself relegated to being an Audit Team Member in another engagement, if a State Auditor IV or
State Auditor V is designated as the Audit Team Leader.
Pursuant to the COA Organizational Restructuring Plan, the COA issued Memorandum No. 2002-034[17] providing for the guidelines
regarding the payment of RATA, thus:
1. All holders of State Auditor IV position shall be entitled to fixed commutable RATA wherever they are assigned.
2. Henceforth, only State Auditors IV shall be assigned as new Unit Heads or Team Leaders.
3. State Auditors below State Auditor IV assigned as Unit Heads or Team Leaders who have been receiving fixed RATA shall
continue to be designated as such and to receive the RATA until relieved of the designation for incompetence,
inefficiency, or misconduct.
All others who collect RATA on reimbursable basis, including those paid on a daily basis under COA Resolution No. 99-007 dated June 7,
1999, are likewise entitled thereto.
Matib, Pacpaco, Sanchez, and Sipi-An are not qualified to be Audit Team Leaders or to receive fixed monthly RATA since none of
them holds the rank or position of State Auditor IV. But this does not mean that they are not entitled to receive reimbursable RATA if they
are designated as Audit Team Leaders. It is clear from the text of the said COA Memorandum that the principle of non-diminution of
benefits has been upheld.
Thus, in the implementation of the COA Organizational Restructuring Plan, we fail to see how petitioners could have sustained
personal injury as they have not shown to have a personal stake therein. Accordingly, they are wanting in legal standing to institute the
instant petition. Corollarily, we find no reason to delve into the constitutionality or legality of the COA Organizational Restructuring Plan.
WHEREFORE, the petition is DISMISSED. No pronouncement as to costs.
SO ORDERED.
Davide, Jr., C.J., Puno, Panganiban, Quisumbing, Ynares-Santiago, Carpio, Austria-Martinez, Corona, Carpio-Morales, Callejo, Sr.,
Azcuna, Tinga, Chico-Nazario, and Garcia, JJ., concur.
G.R. No. 168979 December 2, 2013
REBECCA PACAÑA-CONTRERAS and ROSALIE PACAÑA, Petitioners,
vs.
ROVILA WATER SUPPLY, INC., EARL U KOKSENG, LILIA TORRES, DALLA P. ROMANILLOS and MARISSA GABUYA, Respondents.
DECISION
BRION, J.:
Before the Court is a petition for review on certiorari1 under Rule 4 of the Rules of Court seeking the reversal of the decision2 dated
January 27, 2005 and the resolution3 dated June 6, 2005 of the Courts of Appeals (CA) in CA-G.R. SP No. 71551. The CA set aside the
orders dated February 28, 20024 and April 1, 20025 of the Regional Trial Court (RTC), Branch 8, Cebu City, which denied the motion to
dismiss for reconsideration respectively, of respondents Rovila Water Supply, Inc. (Rovilla, Inc.), Earl U. Kokseng, Lialia Torres, Dalla P.
Romanillos and Marissa Gabuya.
THE FACTUAL ANTECEDENTS
Petitioners Rebecca Pacaña-Contreras and Rosalie Pacaña, children of Lourdes Teves Pacaña and Luciano Pacaña, filed the present case
against Rovila Inc., Earl, Lilia, Dalla and Marisa for accounting and damages.6
The petitioners claimed that their family has long been known in the community to be engaged in the water supply business; they
operated the "Rovila Water Supply" from their family residence and were engaged in the distribution of water to customers in Cebu City.
The petitioners alleged that Lilia was a former trusted employee in the family business who hid business records and burned and
ransacked the family files. Lilia also allegedly posted security guards and barred the members of the Pacaña family from operating their
business. She then claimed ownership over the family business through a corporation named "Rovila Water Supply, Inc." (Rovila Inc.)
Upon inquiry with the Securities and Exchange Commission (SEC), the petitioners claimed that Rovila Inc. was surreptitiously formed with
the respondents as the majority stockholders. The respondents did so by conspiring with one another and forming the respondent
corporation to takeover and illegally usurp the family business’ registered name.7
In forming the respondent corporation, the respondents allegedly used the name of Lourdes as one of the incorporators and made it
appear in the SEC documents that the family business was operated in a place other than the Pacaña residence. Thereafter, the
respondents used the Pacaña family’s receipts and the deliveries and sales were made to appear as those of the respondent Rovila Inc.
Using this scheme, the respondents fraudulently appropriated the collections and payments.8
The petitioners filed the complaint in their own names although Rosalie was authorized by Lourdes through a sworn declaration and
special power of attorney (SPA). The respondents filed a first motion to dismiss on the ground that the RTC had no jurisdiction over an
intra-corporate controversy.9
The RTC denied the motion. On September 26, 2000, Lourdes died10 and the petitioners amended their complaint, with leave of court, on
October 2, 2000 to reflect this development.11
They still attached to their amended complaint the sworn declaration with SPA, but the caption of the amended complaint remained the
same.12
On October 10, 2000, Luciano also died.13
The respondents filed their Answer on November 16, 2000.14
The petitioners’ sister, Lagrimas Pacaña-Gonzales, filed a motion for leave to intervene and her answer-in-intervention was granted by the
trial court. At the subsequent pre-trial, the respondents manifested to the RTC that a substitution of the parties was necessary in light of
the deaths of Lourdes and Luciano. They further stated that they would seek the dismissal of the complaint because the petitioners are
not the real parties in interest to prosecute the case. The pre-trial pushed through as scheduled and the RTC directed the respondents to
put into writing their earlier manifestation. The RTC issued a pre-trial order where one of the issues submitted was whether the complaint
should be dismissed for failure to comply with Section 2, Rule 3 of the Rules of Court which requires that every action must be prosecuted
in the name of the real party in interest.15
On January 23, 2002,16 the respondents again filed a motion to dismiss on the grounds, among others, that the petitioners are not the real
parties in interest to institute and prosecute the case and that they have no valid cause of action against the respondents.
THE RTC RULING
The RTC denied the respondents’ motion to dismiss. It ruled that, save for the grounds for dismissal which may be raised at any stage of
the proceedings, a motion to dismiss based on the grounds invoked by the respondents may only be filed within the time for, but before,
the filing of their answer to the amended complaint. Thus, even granting that the defenses invoked by the respondents are meritorious,
their motion was filed out of time as it was filed only after the conclusion of the pre-trial conference. Furthermore, the rule on
substitution of parties only applies when the parties to the case die, which is not what happened in the present case.17
The RTC likewise denied the respondents’ motion for reconsideration.18
The respondents filed a petition for certiorari under Rule 65 of the Rules of Court with the CA, invoking grave abuse of discretion in the
denial of their motion to dismiss. They argued that the deceased spouses Luciano and Lourdes, not the petitioners, were the real parties
in interest. Thus, the petitioners violated Section 16, Rule 3 of the Rules of Court on the substitution of parties.19
Furthermore, they seasonably moved for the dismissal of the case20 and the RTC never acquired jurisdiction over the persons of the
petitioners as heirs of Lourdes and Luciano.21
THE CA RULING
The CA granted the petition and ruled that the RTC committed grave abuse of discretion as the petitioners filed the complaint and the
amended complaint as attorneys-in-fact of their parents. As such, they are not the real parties in interest and cannot bring an action in
their own names; thus, the complaint should be dismissed22 pursuant to the Court’s ruling in Casimiro v. Roque and Gonzales.23
Neither are the petitioners suing as heirs of their deceased parents.1awp++i1 Pursuant to jurisprudence,24 the petitioners should first be
declared as heirs before they can be considered as the real parties in interest. This cannot be done in the present ordinary civil case but in
a special proceeding for that purpose. The CA agreed with the respondents that they alleged the following issues as affirmative defenses
in their answer: 1) the petitioners are not the real parties in interest; and 2) that they had no legal right to institute the action in behalf of
their parents.25
That the motion to dismiss was filed after the period to file an answer has lapsed is of no moment. The RTC judge entertained it and
passed upon its merit. He was correct in doing so because in the pre-trial order, one of the submitted issues was whether the case must
be dismissed for failure to comply with the requirements of the Rules of Court. Furthermore, in Dabuco v. Court of Appeals, 26 the Court
held that the ground of lack of cause of action may be raised in a motion to dismiss at anytime.27
The CA further ruled that, in denying the motion to dismiss, the RTC judge acted contrary to established rules and jurisprudence which
may be questioned via a petition for certiorari. The phrase "grave abuse of discretion" which was traditionally confined to "capricious and
whimsical exercise of judgment" has been expanded to include any action done "contrary to the Constitution, the law or
jurisprudence[.]"28
THE PARTIES’ ARGUMENTS
The petitioners filed the present petition and argued that, first, in annulling the interlocutory orders, the CA unjustly allowed the motion
to dismiss which did not conform to the rules.29
Specifically, the motion was not filed within the time for, but before the filing of, the answer to the amended complaint, nor were the
grounds raised in the answer. Citing Section 1, Rule 9 of the Rules of Court, the respondents are deemed to have waived these grounds, as
correctly held by the RTC.30
Second, even if there is non-joinder and misjoinder of parties or that the suit is not brought in the name of the real party in interest, the
remedy is not outright dismissal of the complaint, but its amendment to include the real parties in interest.31
Third, the petitioners sued in their own right because they have actual and substantial interest in the subject matter of the action as heirs
or co-owners, pursuant to Section 2, Rule 3 of the Rules of Court.32
Their declaration as heirs in a special proceeding is not necessary, pursuant to the Court’s ruling in Marabilles, et al. v. Quito.33
Finally, the sworn declaration is evidentiary in nature which remains to be appreciated after the trial is completed.34
The respondents reiterated in their comment that the petitioners are not the real parties in interest.35
They likewise argued that they moved for the dismissal of the case during the pre-trial conference due to the petitioners’ procedural lapse
in refusing to comply with a condition precedent, which is, to substitute the heirs as plaintiffs. Besides, an administrator of the estates of
Luciano and Lourdes has already been appointed.36
The respondents also argued that the grounds invoked in their motion to dismiss were timely raised, pursuant to Section 2, paragraphs g
and i, Rule 18 of the Rules of Court. Specifically, the nature and purposes of the pre-trial include, among others, the dismissal of the
action, should a valid ground therefor be found to exist; and such other matters as may aid in the prompt disposition of the action. Finally,
the special civil action of certiorari was the proper remedy in assailing the order of the RTC.37
THE COURT’S RULING
We find the petition meritorious.
Petition for certiorari under Rule 65 is a proper remedy for a denial of a motion to dismiss attended by grave abuse of discretion
In Barrazona v. RTC, Branch 61, Baguio City,38 the Court held that while an order denying a motion to dismiss is interlocutory and non-
appealable, certiorari and prohibition are proper remedies to address an order of denial made without or in excess of jurisdiction. The
writ of certiorari is granted to keep an inferior court within the bounds of its jurisdiction or to prevent it from committing grave abuse of
discretion amounting to lack or excess of jurisdiction.
The history and development of the ground "fails to state a cause of action" in the 1940, 1964 and the present 1997 Rules of Court
Preliminarily, a suit that is not brought in the name of the real party in interest is dismissible on the ground that the complaint "fails to
state a cause of action."39
Pursuant to jurisprudence,40 this is also the ground invoked when the respondents alleged that the petitioners are not the real parties in
interest because: 1) the petitioners should not have filed the case in their own names, being merely attorneys-in-fact of their mother; and
2) the petitioners should first be declared as heirs. A review of the 1940, 1964 and the present 1997 Rules of Court shows that the
fundamentals of the ground for dismissal based on "failure to state a cause of action" have drastically changed over time. A historical
background of this particular ground is in order to preclude any confusion or misapplication of jurisprudence decided prior to the
effectivity of the present Rules of Court. The 1940 Rules of Court provides under Section 10, Rule 9 that:
Section 10. Waiver of defenses- Defenses and objections not pleaded either in a motion to dismiss or in the answer are deemed waived;
except the defense of failure to state a cause of action, which may be alleged in a later pleading, if one is permitted, or by motion for
judgment on the pleadings, or at the trial on the merits; but in the last instance, the motion shall be disposed of as provided in section 5 of
Rule 17 in the light of any evidence which may have been received. Whenever it appears that the court has no jurisdiction over the
subject-matter, it shall dismiss the action. [underscoring supplied]
This provision was essentially reproduced in Section 2, Rule 9 of the 1964 Rules of Court, and we quote:
Section 2. Defenses and objections not pleaded deemed waived. — Defenses and objections not pleaded either in a motion to dismiss or
in the answer are deemed waived; except the failure to state a cause of action which may be alleged in a later pleading, if one is
permitted, or by motion for judgment on the pleadings, or at the trial on the merits; but in the last instance, the motion shall be disposed
of as provided in section 5 of Rule 10 in the light of any evidence which may have been received. Whenever it appears that the court has
no jurisdiction over the subject-matter, it shall dismiss the action. [underscoring supplied]
Under the present Rules of Court, this provision was reflected in Section 1, Rule 9, and we quote:
Section 1. Defenses and objections not pleaded. — Defenses and objections not pleaded either in a motion to dismiss or in the answer are
deemed waived. However, when it appears from the pleadings or the evidence on record that the court has no jurisdiction over the
subject matter, that there is another action pending between the same parties for the same cause, or that the action is barred by a prior
judgment or by statute of limitations, the court shall dismiss the claim. [underscoring supplied]
Notably, in the present rules, there was a deletion of the ground of "failure to state a cause of action" from the list of those which may be
waived if not invoked either in a motion to dismiss or in the answer. Another novelty introduced by the present Rules, which was totally
absent in its two precedents, is the addition of the period of time within which a motion to dismiss should be filed as provided under
Section 1, Rule 16 and we quote:
Section 1. Grounds. — Within the time for but before filing the answer to the complaint or pleading asserting a claim, a motion to dismiss
may be made on any of the following grounds: xxx [underscoring supplied]
All these considerations point to the legal reality that the new Rules effectively restricted the dismissal of complaints in general, especially
when what is being invoked is the ground of "failure to state a cause of action." Thus, jurisprudence governed by the 1940 and 1964 Rules
of Court to the effect that the ground for dismissal based on failure to state a cause of action may be raised anytime during the
proceedings, is already inapplicable to cases already governed by the present Rules of Court which took effect on July 1, 1997. As the rule
now stands, the failure to invoke this ground in a motion to dismiss or in the answer would result in its waiver. According to Oscar M.
Herrera,41 the reason for the deletion is that failure to state a cause of action may be cured under Section 5, Rule 10 and we quote:
Section 5. Amendment to conform to or authorize presentation of evidence. — When issues not raised by the pleadings are tried with the
express or implied consent of the parties they shall be treated in all respects as if they had been raised in the pleadings. Such amendment
of the pleadings as may be necessary to cause them to conform to the evidence and to raise these issues may be made upon motion of
any party at any time, even after judgment; but failure to amend does not effect the result of the trial of these issues. If evidence is
objected to at the trial on the ground that it is not within the issues made by the pleadings, the court may allow the pleadings to be
amended and shall do so with liberality if the presentation of the merits of the action and the ends of substantial justice will be subserved
thereby. The court may grant a continuance to enable the amendment to be made.
With this clarification, we now proceed to the substantial issues of the petition.1âwphi1
The motion to dismiss in the present case based on failure to state a cause of action was not timely filed and was thus waived
Applying Rule 16 of the Rules of Court which provides for the grounds for the dismissal of a civil case, the respondents’ grounds for
dismissal fall under Section 1(g) and (j), Rule 16 of the Rules of Court, particularly, failure to state a cause of action and failure to comply
with a condition precedent (substitution of parties), respectively. The first paragraph of Section 1,42
Rule 16 of the Rules of Court provides for the period within which to file a motion to dismiss under the grounds enumerated. Specifically,
the motion should be filed within the time for, but before the filing of, the answer to the complaint or pleading asserting a claim. Equally
important to this provision is Section 1,43
Rule 9 of the Rules of Court which states that defenses and objections not pleaded either in a motion to dismiss or in the answer are
deemed waived, except for the following grounds: 1) the court has no jurisdiction over the subject matter; 2) litis pendencia; 3) res
judicata; and 4) prescription. Therefore, the grounds not falling under these four exceptions may be considered as waived in the event
that they are not timely invoked. As the respondents’ motion to dismiss was based on the grounds which should be timely invoked,
material to the resolution of this case is the period within which they were raised. Both the RTC and the CA found that the motion to
dismiss was only filed after the filing of the answer and after the pre-trial had been concluded. Because there was no motion to dismiss
before the filing of the answer, the respondents should then have at least raised these grounds as affirmative defenses in their answer.
The RTC’s assailed orders did not touch on this particular issue but the CA ruled that the respondents did, while the petitioners insist that
the respondents did not. In the present petition, the petitioners reiterate that there was a blatant non-observance of the rules when the
respondents did not amend their answer to invoke the grounds for dismissal which were raised only during the pre-trial and,
subsequently, in the subject motion to dismiss.44
The divergent findings of the CA and the petitioners’ arguments are essentially factual issues. Time and again, we have held that the
jurisdiction of the Court in a petition for review on certiorari under Rule 45, such as the present case, is limited only to questions of law,
save for certain exceptions. One of these is attendant herein, which is, when the findings are conclusions without citation of specific
evidence on which they are based.45
In the petition filed with the CA, the respondents made a passing allegation that, as affirmative defenses in their answer, they raised the
issue that the petitioners are not the real parties in interest.46
On the other hand, the petitioners consistently argued otherwise in their opposition47 to the motion to dismiss, and in their
comment48 and in their memorandum49 on the respondents’ petition before the CA. Our examination of the records shows that the CA
had no basis in its finding that the respondents alleged the grounds as affirmative defenses in their answer. The respondents merely
stated in their petition for certiorari that they alleged the subject grounds in their answer. However, nowhere in the petition did they
support this allegation; they did not even attach a copy of their answer to the petition. It is basic that the respondents had the duty to
prove by substantial evidence their positive assertions. Considering that the petition for certiorari is an original and not an appellate
action, the CA had no records of the RTC’s proceedings upon which the CA could refer to in order to validate the respondents’ claim.
Clearly, other than the respondents’ bare allegations, the CA had no basis to rule, without proof, that the respondents alleged the grounds
for dismissal as affirmative defenses in the answer. The respondents, as the parties with the burden of proving that they timely raised
their grounds for dismissal, could have at least attached a copy of their answer to the petition. This simple task they failed to do. That the
respondents did not allege in their answer the subject grounds is made more apparent through their argument, both in their motion to
dismiss50 and in their comment,51 that it was only during the pre-trial stage that they verbally manifested and invited the attention of the
lower court on their grounds for dismissal. In order to justify such late invocation, they heavily relied on Section 2(g) and (i), Rule 18 52 of
the Rules of Court that the nature and purpose of the pre-trial include, among others, the propriety of dismissing the action should there
be a valid ground therefor and matters which may aid in the prompt disposition of the action. The respondents are not correct. The rules
are clear and require no interpretation. Pursuant to Section 1, Rule 9 of the Rules of Court, a motion to dismiss based on the grounds
invoked by the respondents may be waived if not raised in a motion to dismiss or alleged in their answer. On the other hand, "the pre-trial
is primarily intended to make certain that all issues necessary to the disposition of a case are properly raised. The purpose is to obviate
the element of surprise, hence, the parties are expected to disclose at the pre-trial conference all issues of law and fact which they intend
to raise at the trial, except such as may involve privileged or impeaching matter."53
The issues submitted during the pre-trial are thus the issues that would govern the trial proper. The dismissal of the case based on the
grounds invoked by the respondents are specifically covered by Rule 16 and Rule 9 of the Rules of Court which set a period when they
should be raised; otherwise, they are deemed waived.
The Dabuco ruling is inapplicable in the present case; the ground for dismissal "failure to state a cause of action" distinguished from "lack
of cause of action"
To justify the belated filing of the motion to dismiss, the CA reasoned out that the ground for dismissal of "lack of cause of action" may be
raised at any time during the proceedings, pursuant to Dabuco v. Court of Appeals.54
This is an erroneous interpretation and application of Dabuco as will be explained below.
First, in Dabuco, the grounds for dismissal were raised as affirmative defenses in the answer which is in stark contrast to the present case.
Second, in Dabuco, the Court distinguished between the dismissal of the complaint for "failure to state a cause of action" and "lack of
cause of action." The Court emphasized that in a dismissal of action for lack of cause of action, "questions of fact are involved, [therefore,]
courts hesitate to declare a plaintiff as lacking in cause of action. Such declaration is postponed until the insufficiency of cause is apparent
from a preponderance of evidence.
Usually, this is done only after the parties have been given the opportunity to present all relevant evidence on such questions of fact."55
In fact, in Dabuco, the Court held that even the preliminary hearing on the propriety of lifting the restraining order was declared
insufficient for purposes of dismissing the complaint for lack of cause of action. This is so because the issues of fact had not yet been
adequately ventilated at that preliminary stage. For these reasons, the Court declared in Dabuco that the dismissal by the trial court of the
complaint was premature. In the case of Macaslang v. Zamora,56 the Court noted that the incorrect appreciation by both the RTC and the
CA of the distinction between the dismissal of an action, based on "failure to state a cause of action" and "lack of cause of action,"
prevented it from properly deciding the case, and we quote:
Failure to state a cause of action and lack of cause of action are really different from each other. On the one hand, failure to state a cause
of action refers to the insufficiency of the pleading, and is a ground for dismissal under Rule 16 of the Rules of Court. On the other hand,
lack of cause [of] action refers to a situation where the evidence does not prove the cause of action alleged in the pleading. Justice
Regalado, a recognized commentator on remedial law, has explained the distinction: xxx What is contemplated, therefore, is a failure to
state a cause of action which is provided in Sec. 1(g) of Rule 16. This is a matter of insufficiency of the pleading. Sec. 5 of Rule 10, which
was also included as the last mode for raising the issue to the court, refers to the situation where the evidence does not prove a cause of
action. This is, therefore, a matter of insufficiency of evidence. Failure to state a cause of action is different from failure to prove a cause
of action. The remedy in the first is to move for dismissal of the pleading, while the remedy in the second is to demur to the evidence,
hence reference to Sec. 5 of Rule 10 has been eliminated in this section. The procedure would consequently be to require the pleading to
state a cause of action, by timely objection to its deficiency; or, at the trial, to file a demurrer to evidence, if such motion is warranted.
[italics supplied]
Based on this discussion, the Court cannot uphold the dismissal of the present case based on the grounds invoked by the respondents
which they have waived for failure to invoke them within the period prescribed by the Rules. The Court cannot also dismiss the case based
on "lack of cause of action" as this would require at least a preponderance of evidence which is yet to be appreciated by the trial court.
Therefore, the RTC did not commit grave abuse of discretion in issuing the assailed orders denying the respondents’ motion to dismiss and
motion for reconsideration. The Court shall not resolve the merits of the respondents’ grounds for dismissal which are considered as In Galicia, et al. v. Vda. De Mindo, et al.,72 the Court ruled that in line with its policy of promoting a just and inexpensive disposition of a
waived. case, it allowed the intervention of the indispensable parties instead of dismissing the complaint. Furthermore, in Commissioner Domingo
Other heirs of the spouses Pacaña to be impleaded in the case. v. Scheer,73 the Court cited Salvador, et al. v. Court of Appeals, et al.74 and held that the Court has full powers, apart from that power and
It should be emphasized that insofar as the petitioners are concerned, the respondents have waived the dismissal of the complaint based authority which are inherent, to amend the processes, pleadings, proceedings and decisions by substituting as party-plaintiff the real
on the ground of failure to state a cause of action because the petitioners are not the real parties in interest. At this juncture, a distinction party in interest. The Court has the power to avoid delay in the disposition of this case, and to order its amendment in order to implead an
between a real party in interest and an indispensable party is in order. In Carandang v. Heirs of de Guzman, et al., 57 the Court clarified indispensable party. With these discussions as premises, the Court is of the view that the proper remedy in the present case is to implead
these two concepts and held that "[a] real party in interest is the party who stands to be benefited or injured by the judgment of the suit, the indispensable parties especially when their non-inclusion is merely a technical defect. To do so would serve proper administration of
or the party entitled to the avails of the suit. On the other hand, an indispensable party is a party in interest without whom no final justice and prevent further delay and multiplicity of suits. Pursuant to Section 9, Rule 3 of the Rules of Court, parties may be added by
determination can be had of an action, in contrast to a necessary party, which is one who is not indispensable but who ought to be joined order of the court on motion of the party or on its own initiative at any stage of the action. If the plaintiff refuses to implead an
as a party if complete relief is to be accorded as to those already parties, or for a complete determination or settlement of the claim indispensable party despite the order of the court, then the court may dismiss the complaint for the plaintiff’s failure to comply with a
subject of the action. xxx If a suit is not brought in the name of or against the real party in interest, a motion to dismiss may be filed on the lawful court order.75
ground that the complaint states no cause of action. However, the dismissal on this ground entails an examination of whether the parties The operative act that would lead to the dismissal of the case would be the refusal to comply with the directive of the court for the
presently pleaded are interested in the outcome of the litigation, and not whether all persons interested in such outcome are actually joinder of an indispensable party to the case.76
pleaded. The latter query is relevant in discussions concerning indispensable and necessary parties, but not in discussions concerning real Obviously, in the present case, the deceased Pacañas can no longer be included in the complaint as indispensable parties because of their
parties in interest. Both indispensable and necessary parties are considered as real parties in interest, since both classes of parties stand death during the pendency of the case. Upon their death, however, their ownership and rights over their properties were transmitted to
to be benefited or injured by the judgment of the suit." their heirs, including herein petitioners, pursuant to Article 77477 in relation with Article 77778 of the Civil Code.
At the inception of the present case, both the spouses Pacaña were not impleaded as parties-plaintiffs. The Court notes, however, that In Orbeta, et al. v. Sendiong,79 the Court acknowledged that the heirs, whose hereditary rights are to be affected by the case, are deemed
they are indispensable parties to the case as the alleged owners of Rovila Water Supply. Without their inclusion as parties, there can be no indispensable parties who should have been impleaded by the trial court. Therefore, to obviate further delay in the proceedings of the
final determination of the present case. They possess such an interest in the controversy that a final decree would necessarily affect their present case and given the Court’s authority to order the inclusion of an indispensable party at any stage of the proceedings, the heirs of
rights, so that the courts cannot proceed without their presence. Their interest in the subject matter of the suit and in the relief sought is the spouses Pacaña, except the petirioners who are already parties to the case are Lagrimas Pacaña-Gonzalez who intervened in the case,
inextricably intertwined with that of the other parties.58 are hereby ordered impleaded as parties-plaintiffs.
Jurisprudence on the procedural consequence of the inclusion or non-inclusion of an indispensable party is divided in our jurisdiction. Due WHEREFORE, the petition is GRANTED. The decision dated January 27, 2005 and the resolution date June 6, 2005 of the Court of Appeals
to the non-inclusion of indispensable parties, the Court dismissed the case in Lucman v. Malawi, et al.59 and Go v. Distinction Properties in CA-G.R. SP No. 71551 are REVERSED and SET ASIDE. The heirs of the spouses Luciano and Lourdes Pacaña, except herein petitioner and
Development Construction, Inc.,60 while in Casals, et al. v. Tayud Golf and Country Club et al.,61 the Court annulled the judgment which Lagrimas Pacaña-Gonzalez, are ORDERED IMPLEADED as parties plaintiffs and the RTC is directed tp proceed with the trial of the case with
was rendered without the inclusion of the indispensable parties. In Arcelona et al. v. Court of Appeals 62 and Bulawan v. Aquende,63 and DISPATCH.
Metropolitan Bank & Trust Company v. Alejo et al.64 the Court ruled that the burden to implead or order the impleading of an SO ORDERED.
indispensable party rests on the plaintiff and on the trial court, respectively. Thus, the non-inclusion of the indispensable parties, despite ARTURO D. BRION
notice of this infirmity, resulted in the annulment of these cases. In Plasabas, et al. v. Court of Appeals, et al.,65 the Court held that the trial Associate Justice
court and the CA committed reversible error when they summarily dismissed the case, after both parties had rested their cases following WE CONCUR:
a protracted trial, on the sole ground of failure to implead indispensable parties. Non-joinder of indispensable parties is not a ground for ANTONIO T. CARPIO
the dismissal of an action. The remedy is to implead the non-party claimed to be indispensable. However, in the cases of Quilatan, et al. v. Associate Justice
Heirs of Quilatan, et al.66 and Lagunilla, et al. v. Monis, et al.,67 the Court remanded the case to the RTC for the impleading of Chairperson
indispensable parties. On the other hand, in Lotte Phil. Co., Inc. v. Dela Cruz,68PepsiCo, Inc. v. Emerald Pizza, 69 and Valdez Tallorin, v. Heirs JUANA COMPLEX I HOMEOWNERS ASSOCIATION, INC., ANDRES G.R. No. 152272
of Tarona, et al.,70 the Court directly ordered that the indispensable parties be impleaded. Mindful of the differing views of the Court as C. BAUTISTA, BRIGIDO DIMACULANGAN, DOLORES P. PRADO,
regards the legal effects of the non-inclusion of indispensable parties, the Court clarified in Republic of the Philippines v. Sandiganbayan, IMELDA DE LA CRUZ, EDITHA C. DY, FLORENCIA M. MERCADO,
et al.,71that the failure to implead indispensable parties is a curable error and the foreign origin of our present rules on indispensable LEOVINO C. DATARIO, AIDA
parties permitted this corrective measure. This cited case held: A. ABAYON, NAPOLEON M. DIMAANO, ROSITA G. ESTIGOY and
Even in those cases where it might reasonably be argued that the failure of the Government to implead the sequestered corporations as NELSON A. LOYOLA,
defendants is indeed a procedural aberration xxx, slight reflection would nevertheless lead to the conclusion that the defect is not fatal, Petitioners,
but one correctible under applicable adjective rules – e.g., Section 10, Rule 5 of the Rules of Court [specifying the remedy of amendment
during trial to authorize or to conform to the evidence]; Section 1, Rule 20 [governing amendments before trial], in relation to the rule - versus -
respecting omission of so-called necessary or indispensable parties, set out in Section 11, Rule 3 of the Rules of Court. It is relevant in this
context to advert to the old familiar doctrines that the omission to implead such parties "is a mere technical defect which can be cured at FIL-ESTATE LAND, INC.,
any stage of the proceedings even after judgment"; and that, particularly in the case of indispensable parties, since their presence and FIL ESTATE ECOCENTRUM CORPORATION, LA PAZHOUSING AND
participation is essential to the very life of the action, for without them no judgment may be rendered, amendments of the complaint in DEVELOPMENT CORPORATION, WARBIRD SECURITY AGENCY,
order to implead them should be freely allowed, even on appeal, in fact even after rendition of judgment by this Court, where it appears ENRIQUE RIVILLA,
that the complaint otherwise indicates their identity and character as such indispensable parties." Although there are decided cases MICHAEL E. JETHMAL
wherein the non-joinder of indispensable parties in fact led to the dismissal of the suit or the annulment of judgment, such cases do not and MICHAEL ALUNAN,
jibe with the matter at hand. The better view is that non-joinder is not a ground to dismiss the suit or annul the judgment. The rule on Respondents.
joinder of indispensable parties is founded on equity. And the spirit of the law is reflected in Section 11, Rule 3 of the 1997 Rules of Civil x-------------------------------------------x
Procedure. It prohibits the dismissal of a suit on the ground of non-joinder or misjoinder of parties and allows the amendment of the FIL-ESTATE LAND, INC.,
complaint at any stage of the proceedings, through motion or on order of the court on its own initiative. Likewise, jurisprudence on the FIL ESTATE ECOCENTRUM CORPORATION, LA PAZHOUSING AND
Federal Rules of Procedure, from which our Section 7, Rule 3 on indispensable parties was copied, allows the joinder of indispensable DEVELOPMENT CORPORATION, WARBIRD SECURITY AGENCY,
parties even after judgment has been entered if such is needed to afford the moving party full relief. Mere delay in filing the joinder ENRIQUE RIVILLA, MICHAEL E. JETHMAL and MICHAEL ALUNAN,
motion does not necessarily result in the waiver of the right as long as the delay is excusable. Petitioners,
- versus - Accordingly, JCHA, et al. also prayed for the immediate issuance of a Temporary Restraining Order (TRO) or a writ of
JUANA COMPLEX I HOMEOWNERS ASSOCIATION, INC., ANDRES preliminary injunction (WPI) to enjoin Fil-Estate, et al. from stopping and intimidating them in their use of La Paz Road.
C. BAUTISTA, BRIGIDO DIMACULANGAN, DOLORES P. PRADO, G. R. No. 152397
IMELDA DE LA CRUZ, EDITHA C. DY, FLORENCIA M. On February 10, 1999, a TRO was issued ordering Fil-Estate, et al, for a period of twenty (20) days, to stop preventing, coercing,
MERCADO, LEOVINO C. DATARIO, AIDA Present: intimidating or harassing the commuters and motorists from using the La Paz Road. [6]
A. ABAYON, NAPOLEON M. DIMAANO, ROSITA G. ESTIGOY and
NELSON A. LOYOLA, VELASCO, JR., J., Chairperson, Subsequently, the RTC conducted several hearings to determine the propriety of the issuance of a WPI.
Respondents. PERALTA,
ABAD, On February 26, 1999, Fil-Estate, et al. filed a motion to dismiss[7] arguing that the complaint failed to state a cause of action
MENDOZA, and and that it was improperly filed as a class suit. On March 5, 1999, JCHA, et al. filed their comment[8] on the motion to dismiss to which
PERLAS-BERNABE, JJ. respondents filed a reply.[9]

On March 3, 1999, the RTC issued an Order [10] granting the WPI and required JCHA, et al. to post a bond.

On March 19, 1999, Fil-Estate, et al. filed a motion for reconsideration[11] arguing, among others, that JCHA, et al. failed to
satisfy the requirements for the issuance of a WPI. On March 23, 1999, JCHA, et al. filed their opposition to the motion.[12]

The RTC then issued its June 16, 2000 Omnibus Order, denying both the motion to dismiss and the motion for reconsideration
filed by Fil-Estate, et al.

Promulgated:
March 5, 2012
X -------------------------------------------------------------------------------------- X
DECISION
MENDOZA, J.:
Before the Court are two (2) consolidated petitions assailing the July 31, 2001 Decision[1] and February 21, 2002 Resolution[2] of
the Court of Appeals (CA) in CA-G.R. SP No. 60543, which annulled and set aside the March 3, 1999 Order[3] of the Regional Trial Court,
Branch 25, Bian, Laguna (RTC), granting the application for the issuance of a writ of preliminary injunction, and upheld the June 16, 2000
Omnibus Order[4] denying the motion to dismiss.
The Facts:
On January 20, 1999, Juana Complex I Homeowners Association, Inc. (JCHA), together with individual residents of Juana
Complex I and other neighboring subdivisions (collectively referred as JCHA, et. al.), instituted a complaint[5] for damages, in its own behalf
and as a class suit representing the regular commuters and motorists of Juana Complex I and neighboring subdivisions who were deprived
of the use of La Paz Road, against Fil-Estate Land, Inc. (Fil-Estate), Fil-estate Ecocentrum Corporation (FEEC), La Paz Housing &
Development Corporation (La Paz), and Warbird Security Agency and their respective officers (collectively referred as Fil-Estate, et al.).
Not satisfied, Fil-Estate, et al. filed a petition for certiorari and prohibition before the CA to annul (1) the Order dated March 3,
1999 and (2) the Omnibus Order dated June 16, 2000. They contended that the complaint failed to state a cause of action and that it was
improperly filed as a class suit. With regard to the issuance of the WPI, the defendants averred that JCHA, et al. failed to show that they
had a clear and unmistakable right to the use of La Paz Road; and further claimed that La Paz Road was a torrens registered private road
and there was neither a voluntary nor legal easement constituted over it.[13]
On July 31, 2001, the CA rendered the decision partially granting the petition, the dispositive portion of which reads:
WHEREFORE, the petition is hereby partially GRANTED. The Order dated March 3, 1999 granting the writ
of preliminary injunction is hereby ANNULLED and SET ASIDE but the portion of the Omnibus Order dated June 16,
2000 denying the motion to dismiss is upheld.
SO ORDERED.[14]
The CA ruled that the complaint sufficiently stated a cause of action when JCHA, et al. alleged in their complaint that they had
been using La Paz Road for more than ten (10) years and that their right was violated when Fil-Estate closed and excavated the road. It
sustained the RTC ruling that the complaint was properly filed as a class suit as it was shown that the case was of common interest and
that the individuals sought to be represented were so numerous that it was impractical to include all of them as parties. The CA, however,
annulled the WPI for failure of JCHA, et al. to prove their clear and present right over La Paz Road. The CA ordered the remand of the case
to the RTC for a full-blown trial on the merits.
Hence, these petitions for review.

The complaint alleged that JCHA, et al. were regular commuters and motorists who constantly travelled towards the direction
of Manila and Calamba; that they used the entry and exit toll gates of South Luzon Expressway (SLEX) by passing through right-of-way
public road known as La Paz Road; that they had been using La Paz Road for more than ten (10) years; that in August 1998, Fil-estate
excavated, broke and deliberately ruined La Paz Road that led to SLEX so JCHA, et al. would not be able to pass through the said road; that
La Paz Road was restored by the residents to make it passable but Fil-estate excavated the road again; that JCHA reported the matter to
the Municipal Government and the Office of the Municipal Engineer but the latter failed to repair the road to make it passable and safe to
motorists and pedestrians; that the act of Fil-estate in excavating La Paz Road caused damage, prejudice, inconvenience, annoyance, and
loss of precious hours to them, to the commuters and motorists because traffic was re-routed to narrow streets that caused terrible
traffic congestion and hazard; and that its permanent closure would not only prejudice their right to free and unhampered use of the
property but would also cause great damage and irreparable injury.
In G.R. No. 152272, JCHA, et al. come to this Court, raising the following issues:
(A)
THE HONORABLE COURT OF APPEALS, IN HOLDING THAT A FULL-BLOWN TRIAL ON THE MERITS IS
REQUIRED TO DETERMINE THE NATURE OF THE LA PAZ ROAD, HAD DEPARTED FROM THE ACCEPTED AND USUAL
COURSE OF JUDICIAL PROCEEDINGS AS TO CALL FOR AN EXERCISE OF THE POWER OF SUPERVISION.
(B)
 THE HONORABLE COURT OF APPEALS, IN HOLDING THAT THE PETITIONERS FAILED TO SATISFY THE
REQUIREMENTS FOR THE ISSUANCE OF A WRIT OF PRELIMINARY INJUNCTION, HAD DECIDED NOT IN ACCORD
WITH LAW AND WITH THE APPLICABLE DECISIONS OF THE SUPREME COURT.[15]
In G.R. No. 152397, on the other hand, Fil-Estate, et al. anchor their petition on the following issues:
I.
The Court of Appeals declaration that respondents Complaint states a cause of action is contrary to existing law
and jurisprudence.
II.
The Court of Appeals pronouncement that respondents complaint was properly filed as a class suit is contrary to
existing law and jurisprudence.
III.
The Court of Appeals conclusion that full blown trial on the merits is required to determine the nature of the La
Paz Road is contrary to existing laws and jurisprudence.[16]
JCHA, et al. concur with the CA that the complaint sufficiently stated a cause of action. They, however, disagree with the CAs
pronouncement that a full-blown trial on the merits was necessary. They claim that during the hearing on the application of the writ of
injunction, they had sufficiently proven that La Paz Road was a public road and that commuters and motorists of their neighboring villages
had used this road as their means of access to the San Agustin Church, Colegio De San Agustin and to SLEX in going to Metro Manila and
to Southern Tagalog particularly during the rush hours when traffic at Carmona Entry/Exit and Susana Heights Entry/Exit was at its worst.
JCHA, et al. argue that La Paz Road has attained the status and character of a public road or burdened by an apparent
easement of public right of way. They point out that La Paz Road is the widest road in the neighborhood used by motorists in going
to Halang Road and in entering the SLEX-Halang toll gate and that there is no other road as wide as La Paz Road existing in the vicinity. For
residents of San Pedro, Laguna, the shortest, convenient and safe route towards SLEX Halang is along Rosario Avenue joining La Paz Road.
Finally, JCHA, et al. argue that the CA erred when it voided the WPI because the public nature of La Paz Road had been
sufficiently proven and, as residents of San Pedro and Bian, Laguna, their right to use La Paz Road is undeniable.
In their Memorandum,[17] Fil-Estate, et al. explain that La Paz Road is included in the parcels of land covered by Transfer
Certificates of Title (TCT) Nos. T-120008, T-90321 and T-90607, all registered in the name of La Paz. The purpose of constructing La Paz
Road was to provide a passageway for La Paz to its intended projects to the south, one of which was the Juana Complex I. When Juana
Complex I was completed, La Paz donated the open spaces, drainage, canal, and lighting facilities inside the Juana Complex I to the
Municipality of Bian. The streets within the subdivisions were then converted to public roads and were opened for use of the general
public. The La Paz Road, not being part of the Juana Complex I, was excluded from the donation. Subsequently, La Paz became a
shareholder of FEEC, a consortium formed to develop several real properties in Bian, Laguna, known as Ecocentrum Project. In exchange
for shares of stock, La Paz contributed some of its real properties to the Municipality of Bian, including the properties constituting La Paz
Road, to form part of the Ecocentrum Project.
Fil-Estate, et al. agree with the CA that the annulment of the WPI was proper since JCHA, et al. failed to prove that they have a
clear right over La Paz Road. Fil-Estate, et al. assert that JCHA, et al. failed to prove the existence of a right of way or a right to pass over La
Paz Road and that the closure of the said road constituted an injury to such right. According to them, La Paz Road is a torrens registered
private road and there is neither a voluntary nor legal easement constituted over it. They claim that La Paz Road is a private property
registered under the name of La Paz and the beneficial ownership thereof was transferred to FEEC when La Paz joined the consortium for
the Ecocentrum Project.
Fil-Estate, et al., however, insist that the complaint did not sufficiently contain the ultimate facts to show a cause of action.
They aver the bare allegation that one is entitled to something is an allegation of a conclusion which adds nothing to the pleading.
They likewise argue that the complaint was improperly filed as a class suit for it failed to show that JCHA, et al. and the commuters
and motorists they are representing have a well-defined community of interest over La Paz Road. They claim that the excavation of La Paz Road would not
necessarily give rise to a common right or cause of action for JCHA, et al. against them since each of them has a separate and distinct purpose and each may
be affected differently than the others.
The Courts Ruling
The issues for the Courts resolution are: (1) whether or not the complaint states a cause of action; (2) whether the complaint has been
properly filed as a class suit; and (2) whether or not a WPI is warranted.
Section 2, Rule 2 of the Rules of Court defines a cause of action as an act or omission by which a party violates the right of
another. A complaint states a cause of action when it contains three (3) essential elements of a cause of action, namely:
(1) the legal right of the plaintiff,
(2) the correlative obligation of the defendant, and
(3) the act or omission of the defendant in violation of said legal right.[18]
The question of whether the complaint states a cause of action is determined by its averments regarding the acts committed
by the defendant.[19] Thus, it must contain a concise statement of the ultimate or essential facts constituting the plaintiffs cause of
action.[20] To be taken into account are only the material allegations in the complaint; extraneous facts and circumstances or other
matters aliunde are not considered.[21]
The test of sufficiency of facts alleged in the complaint as constituting a cause of action is whether or not admitting the facts
alleged, the court could render a valid verdict in accordance with the prayer of said complaint.[22] Stated differently, if the allegations in
the complaint furnish sufficient basis by which the complaint can be maintained, the same should not be dismissed regardless of the
defense that may be asserted by the defendant.[23]
In the present case, the Court finds the allegations in the complaint sufficient to establish a cause of action. First, JCHA, et al.s
averments in the complaint show a demandable right over La Paz Road. These are: (1) their right to use the road on the basis of their
allegation that they had been using the road for more than 10 years; and (2) an easement of a right of way has been constituted over the
said roads. There is no other road as wide as La Paz Road existing in the vicinity and it is the shortest, convenient and safe route towards
SLEX Halang that the commuters and motorists may use. Second, there is an alleged violation of such right committed by Fil-Estate, et al.
when they excavated the road and prevented the commuters and motorists from using the same. Third, JCHA, et al. consequently
suffered injury and that a valid judgment could have been rendered in accordance with the relief sought therein.
With respect to the issue that the case was improperly instituted as a class suit, the Court finds the opposition without merit.
Section 12, Rule 3 of the Rules of Court defines a class suit, as follows:
Sec. 12. Class suit. When the subject matter of the controversy is one of common or general interest to
many persons so numerous that it is impracticable to join all as parties, a number of them which the court finds to
be sufficiently numerous and representative as to fully protect the interests of all concerned may sue or defend for
the benefit of all. Any party in interest shall have the right to intervene to protect his individual interest.
The necessary elements for the maintenance of a class suit are: 1) the subject matter of controversy is one of common or
general interest to many persons; 2) the parties affected are so numerous that it is impracticable to bring them all to court; and 3) the
parties bringing the class suit are sufficiently numerous or representative of the class and can fully protect the interests of all
concerned.[24]
In this case, the suit is clearly one that benefits all commuters and motorists who use La Paz Road. As succinctly stated by the
CA:
The subject matter of the instant case, i.e., the closure and excavation of the La Paz Road, is initially
shown to be of common or general interest to many persons. The records reveal that numerous individuals have
filed manifestations with the lower court, conveying their intention to join private respondents in the suit and
claiming that they are similarly situated with private respondents for they were also prejudiced by the acts of
petitioners in closing and excavating the La Paz Road. Moreover, the individuals sought to be represented by private
respondents in the suit are so numerous that it is impracticable to join them all as parties and be named individually
as plaintiffs in the complaint. These individuals claim to be residents of various barangays in Bian, Laguna and other
barangays in San Pedro, Laguna.
 Anent the issue on the propriety of the WPI, Section 3, Rule 58 of the Rules of Court lays down the rules for the issuance
thereof. Thus:
(a) That the applicant is entitled to the relief demanded, and the whole or part of such relief consists in restraining the
commission or continuance of the acts complained of, or in the performance of an act or acts, either for a limited period or
perpetually;
(b) That the commission, continuance or non-performance of the act or acts complained of during the litigation would
probably work injustice to the applicant; or
(c) That a party, court, or agency or a person is doing, threatening, or attempting to do, or is procuring or suffering to be
done, some act or acts probably in violation of the rights of the applicant respecting the subject of the action or proceeding, and
tending to render the judgment ineffectual.
A writ of preliminary injunction is available to prevent a threatened or continuous irremediable injury to parties before their claims can be
thoroughly studied and adjudicated.[25] The requisites for its issuance are: (1) the existence of a clear and unmistakable right that must be protected; and (2)
an urgent and paramount necessity for the writ to prevent serious damage.[26]For the writ to issue, the right sought to be protected must be a present right, a
legal right which must be shown to be clear and positive.[27] This means that the persons applying for the writ must show that they have an
ostensible right to the final relief prayed for in their complaint.[28]
In the case at bench, JCHA, et al. failed to establish a prima facie proof of violation of their right to justify the issuance of a WPI. Their right to the
use of La Paz Road is disputable since they have no clear legal right therein. As correctly ruled by the CA:
Here, contrary to the ruling of respondent Judge, private respondents failed to prove as yet that they have a clear and
unmistakable right over the La Paz Road which was sought to be protected by the injunctive writ. They merely anchor their
purported right over the La Paz Road on the bare allegation that they have been using the same as public road right-of-way for more
than ten years. A mere allegation does not meet the standard of proof that would warrant the issuance of the injunctive writ.
Failure to establish the existence of a clear right which should be judicially protected through the writ of injunction is a sufficient
ground for denying the injunction.
Consequently, the case should be further heard by the RTC so that the parties can fully prove their respective positions on the issues.
Due process considerations dictate that the assailed injunctive writ is not a judgment on the merits but merely an order for the
grant of a provisional and ancillary remedy to preserve the status quo until the merits of the case can be heard. The hearing on the
application for issuance of a writ of preliminary injunction is separate and distinct from the trial on the merits of the main case. [29] The
evidence submitted during the hearing of the incident is not conclusive or complete for only a "sampling" is needed to give the trial court
an idea of the justification for the preliminary injunction pending the decision of the case on the merits.[30] There are vital facts that have
yet to be presented during the trial which may not be obtained or presented during the hearing on the application for the injunctive
writ.[31] Moreover, the quantum of evidence required for one is different from that for the other.[32]
WHEREFORE, the petitions are DENIED. Accordingly, the July 31, 2001 Decision and February 21, 2002 Resolution of the Court
of Appeals in CA-G.R. SP No. 60543 are AFFIRMED.
SO ORDERED.
JOSE CATRAL MENDOZA
Associate Justice
WE CONCUR:
PRESBITERO J. VELASCO, JR.
Associate Justice
Chairperson
G.R. No. L-23136 August 26, 1974
ISMAEL MATHAY, JOSEFINA MATHAY, DIOGRACIAS T. REYES and S. ADOR DIONISIO, plaintiffs-appellants,
vs.
THE CONSOLIDATED BANK AND TRUST COMPANY, JOSE MARINO OLONDRIZ, WILFRIDO C. TECSON, SIMON R. PATERNO, FERMIN Z.
CARAM, JR., ANTONIO P. MADRIGAL, JOSE P. MADRIGAL, CLAUDIO TEEHANKEE, and ALFONSO JUAN OLONDRIZ, defendants-appellees.
CIPRIANO AZADA, MARIA CRISTINA OLONDRIZ PERTIERRA jointly with her husband ARTURO PERTIERRA, and MARIA DEL PUY
OLONDRIZ DE STEVENS, movants-intervenors-appellants.
Deogracias T. Reyes & Associates for appellants.
Tañada, Teehankee & Carreon for appellees.
Paterno Pedrena for appellee Fermin Z. Caram, Jr.
ZALDIVAR, J.:p
In this appeal, appellants-plaintiffs and movants-intervenors seek the reversal of the order dated March 21, 1964 of the Court of First
Instance of Manila dismissing the complaint together with all other pending incidents in Civil Case No. 55810.
The complaint in this case, filed on December 24, 1963 as a class suit, under Section 12, Rule 3, of the Rules of Court, contained six causes
of action. Under the first cause of action, plaintiffs-appellants alleged that they were, on or before March 28, 1962, stockholders in the
Consolidated Mines, Inc. (hereinafter referred to as CMI), a corporation duly organized and existing under Philippine laws; that the
stockholders of the CMI, including the plaintiffs-appellants, passed, at a regular stockholders' meeting, a Resolution providing: (a) that the
Consolidated Bank & Trust Co. (hereinafter referred to as Bank) be organized with an authorized capital of P20,000,000.00; (b) that the
organization be undertaken by a Board of Organizers composed of the President and Members of the Board of Directors of the CMI; (c)
that all stockholders of the CMI, who were legally qualified to become stockholders, would be entitled to subscribe to the capital stock of
the proposed Bank "at par value to the same extent and in the same amount as said stockholders' respective share holdings in the CMI,"
as shown in its stock books on a date to be fixed by the Board of Directors [which date was subsequently fixed as January 15, 1963],
provided that the right to subscribe should be exercised within thirty days from the date so fixed, and "that if such right to subscription be
not so exercised then the stockholders concerned shall be deemed to have thereby waived and released ipso factotheir right to such
subscription in favor of the Interim Board of Organizers of the Defendant Bank or their assignees;" and (d) that the Board of Directors of
the CMI be authorized to declare a "special dividend" in an amount it would fix, which the subscribing stockholders might authorize to be
paid directly to the treasurer of the proposed Bank in payment of the subscriptions; that the President and members of the Board of
Directors of the CMI, who are the individuals-defendants-appellees in the instant case, constituted themselves as the Interim Board of
Organizers; that said Board sent out, on or about November 20, 1962, to the CMI stockholders, including the plaintiffs-appellants, circular
letters with "Pre-Incorporation Agreement to Subscribe" forms that provided that the payment of the subscription should be made in cash
from time to time or by the application of the special dividend declared by the CMI, and that the subscription must be made within the
period from December 4, 1962 to January 15, 1963, "otherwise such subscription right shall be deemed to have been thereby ipso
facto waived and released in favor of the Board of Organizers of the Defendant Bank and their assignees"; that the plaintiffs-appellants
accomplished and filed their respective "Pre-Incorporation Agreement to Subscribe" and paid in full their subscriptions; that plaintiffs-
appellants and the other CMI subscribing stockholders in whose behalf the action was brought also subscribed to a very substantial
amount of shares; that on June 25, 1963, the Board of Organizers caused the execution of the Articles or Incorporation of the proposed
Bank indicating an original subscription of 50,000 shares worth P5,000,000 subscribed and paid only by six of the individuals-defendants-
appellees, namely, Antonio P. Madrigal, Jose P. Madrigal Simon R. Paterno, Fermin Z. Caram, Jr., Claudio Teehankee, and Wilfredo C.
Tecson, thereby excluding the plaintiffs-appellants and the other CMI subscribing stockholders who had already subscribed; that the
execution of said Articles of Incorporation was "in violation of law and in breach of trust and contractual agreement as a means to gain
control of Defendant Bank by Defendant Individuals and persons or entities chosen by them and for their personal profit or gain in
disregard of the rights of Plaintiffs and other CMI Subscribing Stockholders;" that the paid-in capital stock was raised, as required by the
Monetary Board, to P8,000,000.00, and individuals-defendants-appellees caused to be issued from the unissued shares 30,000 shares
amounting to P3,000,000.00, all of which were again subscribed and paid for entirely by individuals-defendants-appellees or entities
chosen by them "to the exclusion of Plaintiffs and other CMI subscribing stockholders" "in violation of law and breach of trust and of the
contractual agreement embodied in the contractual agreement of March 28, 1962"; that the Articles were filed with the Securities and
Exchange Commission which issued the Certificate of Incorporation on June 25, 1963; that as of the date of the Complaint, the plaintiffs-
appellants and other CMI subscribing stockholders had been denied, through the unlawful acts and manipulation of the defendant Bank
and Individuals-defendants-appellees, the right to subscribe at par value, in proportion to their equities established under their respective
"Pre-Incorporation Agreements to Subscribe" to the capital stock, i.e., (a) to the original issue of 50,000 shares and/or (b) to the additional
issue of 30,000 shares, and/or (c) in that portion of said original or additional issue which was unsubscribed; that the individuals-
defendants-appellees and the persons chosen by them had unlawfully acquired stockholdings in the defendant-appellee Bank in excess of
what they were lawfully entitled and held such shares "in trust" for the plaintiffs-appellants and the other CMI stockholders; that it would
have been vain and futile to resort to intra corporate remedies under the facts and circumstances alleged above. As relief on the first
cause of action, plaintiffs-appellants prayed that the subscriptions and share holdings acquired by the individuals-defendants- appellees
and the persons chosen by them, to the extent that plaintiffs-appellants and the other CMI stockholders had been deprived of their right
to subscribe, be annulled and transferred to plaintiffs-appellants and other CMI subscribing stockholders.
Besides reproducing all the above allegations in the other causes of action, plaintiffs-appellants further alleged under the second cause of
action that on or about August 28, 1963, defendants-appellees Antonio P. Madrigal, Jose P. Madrigal: Fermin Z. Caram, Jr., and Wilfredo C.
Tecson "falsely certified to the calling of a special stockholders' meeting allegedly pursuant to due notice and call of Defendant Bank"
although plaintiffs-appellants and other CMI stockholders were not notified thereof, and amended the Articles of Incorporation increasing
the number of Directors from 6 to 7, and had the illegally created Position of Director filled up by defendant-appellee Alfonso Juan
Olondriz, who was not competent or qualified to hold such position. In the third cause of action, plaintiffs-appellants claimed actual
damages in an amount equivalent to the difference between the par value of the shares they were entitled, but failed, to acquire and the
higher market value of the same shares. In the fourth cause of action, Plaintiffs-appellants claimed moral damages; in the fifth, exemplary
damages; and in the sixth, attorney's fees.
In his manifestation to the court on January 4, 1964, Francisco Sevilla, who was one of the original plaintiffs, withdrew. On January 15,
1964 Cipriano Azada, Maria Cristina Olondriz Pertierra, Maria del Puy Olondriz de Stevens (who later withdrew as intervenors-appellants)
and Carmen Sievert de Amoyo, filed a motion to intervene, and to join the plaintiffs-appellants on record, to which motion defendants-
appellees, except Fermin Z. Caram, Jr., filed, on January 17, 1964 their opposition.
On February 7, 1964 defendants-appellees, except Fermin Z. Caram, Jr., filed a motion to dismiss on the grounds that (a) plaintiffs-
appellants had no legal standing or capacity to institute the alleged class suit; (b) that the complaint did not state a sufficient and valid
cause of action; and (c) that plaintiffs-appellants' complaint against the increase of the number of directors did not likewise state a cause
of action. Plaintiffs-appellants filed their opposition thereto on February 21, 1964.
On March 4, 1964 appellants, plaintiffs and intervenors, filed a verified petition for a writ of preliminary injunction to enjoin defendants-
appellees from considering or ratifying by resolution, at the meeting of the stockholders of defendant-appellee Bank to be held the
following day, the unlawful apportionment of the shares of the defendant-appellee Bank and the illegal amendment to its Articles of
Incorporation increasing the number of Directors, The Court, after hearing, granted the writ, but subsequently set it aside upon the
appellees' filing a counter bond.
Some subscribers to the capital stock of the Bank like Concepcion Zuluaga, et al., and Carlos Moran Sison, et al., filed separate
manifestations that they were opposing and disauthorizing the suit of plaintiffs-appellants.
On March 7, 1964 defendants-appellees, except Fermin Z. Caram, Jr., filed a supplemental ground for their motion to dismiss, to wit, that
the stockholders, except Fermin Z. Caram, Jr., who abstained, had unanimously, at their regular annual meeting held on March 5, 1964,
ratified and confirmed all the actuations of the organizers-directors in the incorporation, organization and establishment of the Bank.
In its order, dated March 21, 1964, the trial court granted the motion to dismiss, holding, among other things, that the class suit could not
be maintained because of the absence of a showing in the complaint that the plaintiffs-appellants were sufficiently numerous and
representative, and that the complaint failed to state a cause of action. From said order, appellants, plaintiffs and intervenors, interposed
this appeal to this Court on questions of law and fact, contending that the lower court erred as follows:
1. In holding that plaintiffs-appellants could not maintain the present class suit because of the absence of a showing
in the complaint that they were sufficiently numerous and representative;
II. In holding that the instant action could not be maintained as a class suit because plaintiffs-appellants did not
have a common legal interest in the subject matter of the suit;
III. In dismissing the present class suit on the ground that it did not meet the requirements of Rule 3, section 12 of
the Rules of Court;
IV. In holding that the complaint was fatally defective in that it failed to state with particularity that plaintiffs-
appellants had resorted to, and exhausted, intra-corporate remedies;
V. In resolving defendants-appellees' motion on the basis of facts not alleged in the complaint;
VI. In holding that plaintiffs-appellants' complaint stated no valid cause of action against defendants-appellees;
VII. In not holding that a trust relationship existed between the Interim Board of Organizers of defendant-appellee
Bank and the CMI subscribing stockholders and in not holding that the waiver was in favor of the Board of Trustees
for the CMI subscribing stockholders;
VIII. In holding that the failure of plaintiffs-appellants to allege that they had paid or had offered to pay for the
shares allegedly pertaining to them constituted another ground for dismissal;
XI. In holding that the allegations under the second cause of action stated no valid cause of action due to a fatal
omission to allege that plaintiffs-appellants were stockholders of record at the time of the holding of the special
stockholders' meeting;
X. In holding that plaintiffs-appellants' complaint stated no cause of action against defendant-appellee Bank; and
XI. In considering the resolution of ratification and confirmation and in holding that the resolution rendered the
issues in this case moot.
The assigned error revolve around two questions namely: (1) whether the instant action could be maintained as a class suit, and (2)
whether the complaint stated a cause of action. These issues alone will be discussed.
1. Appellants contended in the first three assigned errors that the trial court erred in holding that the present suit could not be
maintained as a class suit, and in support thereof argued that the propriety of a class suit should be determined by the common interest
in the subject matter of the controversy; that in the instant case there existed such common interest which consisted not only in the
recovery of the shares of which the appellants were unlawfully deprived, but also in divesting the individuals-defendants-appellees and
the person or entities chosen by them of control of the appellee Bank. 1 ; that the complaint showed that besides the four plaintiff-
appellants of record, and the four movant-intervenors-appellants there were in the appellee Bank many other stockholders who, tough
similarly situated as the appellants, did not formally include themselves as parties on record in view of the representative character of the
suit; that the test, in order to determine the legal standing of a party to institute a class suit, was not one, of number, but whether or not
the interest of said party was representative of the persons in whose behalf the class suit was instituted; that granting arguendo, that the
plaintiffs-appellants were not sufficiently numerous and representative, the court should not have dismissed the action, for insufficiency
of number in a class suit was not a ground for a motion to dismiss, and the court should have treated the suit as an action under Rule 3,
section 6, of the Rules of Court which permits a joinder of parties.
Defendants-appellees, on the contrary, stressed that the instant suit was instituted as a class suit and the plaintiffs-appellants did not sue
in their individual capacities for the protection of their individual interests; that the plaintiffs appellants of record could not be considered
numerous and representative, as said plaintiffs-appellants were only four out of 1,500 stockholders, and owned only 8 shares out of the
80,000 shares of stock of the appellee Bank; that even if to the four plaintiffs-appellants were added the four movants-intervenors-
appellants the situation would be the same as two of the intervenors, to wit, Ma. Cristina Olondriz Pertierra and Ma. del Puy Olondriz de
Stevens, could not sue as they did not have their husbands' consent; that it was necessary that in a class suit the complaint itself should
allege facts showing that the plaintiffs were sufficiently numerous and representative, and this did not obtain in the instant case, as the
complaint did not. even allege how many other CMI stockholders were "similarly situated"; that the withdrawal of one plaintiff, Francisco
Sevilla, the subsequent disclaimers of any interest in the suit made in two separate pleadings by other CMI stockholders and the
disauthorization of their being represented by plaintiffs-appellants by the 986 (out of 1,663) stockholders who attended the annual
meeting of bank stockholders on March 5, 1964, completely negated plaintiffs-appellants' pretension that they were sufficiently
numerous and representative or that there were many other stockholders similarly situated whom the plaintiffs-appellants allegedly
represented; that plaintiffs-appellants did not have that common or general interest required by the Rules of Court in the subject matter
of the suit.2
In their Reply Brief, appellants insisted that non-compliance with Section 12, Rule 3, not being one enumerated in Rules 16 and 17, was
not a ground for dismissal; that the requirements for a class had been complied with; that the required common interest existed even if
the interests were several for there was a common question of law or fact and a common relief was sought; that the common or general
interest could be in the object of the action, in the result of the proceedings, or in the question involved in the action, as long as there was
a common right based on the same essential facts; that plaintiffs-appellants adequately represented the aggrieved group of bank
stockholders, inasmuch as appellants' interests were not antagonistic to those of the latter, and appellants were in the same position as
the group in whose behalf the complaint was filed.
The governing statutory provision for the maintenance of a class suit is Section 12 of Rule 3 of the Rules of Court, which reads as follows:
Sec. 12. Class suit — When the subject matter of the controversy is one of common or general interest to many
persons, and the parties are so numerous that it is impracticable to bring them all before the court, one or more
may sue or defend for the benefit of -ill. But in such case the court shall make sure that the parties actually before it
are sufficiently numerous and representative so that all interests concerned are fully protected. Any party in
interest shall have a right to intervene in protection of his individual interest.
The necessary elements for the maintenance of a class suit are accordingly: (1) that the subject matter of the controversy be one of
common or general interest to many persons, and (2) that such persons be so numerous as to make it impracticable to bring them all to
the court. An action does not become a class suit merely because it is designated as such in the pleadings. Whether the suit is or is not a
class quit depends upon the attending facts, and the complaint, or other pleading initiating the class action should allege the existence of
the necessary facts, to wit, the existence of a subject matter of common interest, and the existence of a class and the number of persons
in the alleged class,3 in order that the court might be enabled to determine whether the members of the class are so numerous as to
make it impracticable to bring them all before the court, to contrast the number appearing on the record with the number in the class and
to determine whether claimants on record adequately represent the class and the subject matter of general or common interest.4
The complaint in the instant case explicitly declared that the plaintiffs- appellants instituted the "present class suit under Section 12, Rule
3, of the Rules of Court in. behalf of CMI subscribing stockholders"5 but did not state the number of said CMI subscribing stockholders so
that the trial court could not infer, much less make sure as explicitly required by the sufficiently numerous and representative in order
that all statutory provision, that the parties actually before it were interests concerned might be fully protected, and that it was
impracticable to bring such a large number of parties before the court.
The statute also requires, as a prerequisite to a class suit, that the subject-matter of the controversy be of common or general interest to
numerous persons. Although it has been remarked that the "innocent 'common or general interest' requirement is not very helpful in
determining whether or not the suit is proper",6 the decided cases in our jurisdiction have more incisively certified the matter when there
is such common or general interest in the subject matter of the controversy. By the phrase "subject matter of the action" is meant "the
physical facts, the things real or personal, the money, lands, chattels, and the like, in relation to which the suit is prosecuted, and not the
delict or wrong committed by the defendant."7
This Court has ruled that a class suit did not lie in an action for recovery of real property where separate portions of the same parcel were
occupied and claimed individually by different parties to the exclusion of each other, such that the different parties had determinable,
though undivided interests, in the property in question.8 It his likewise held that a class suit would not lie against 319 defendants
individually occupying different portions of a big parcel of land, where each defendant had an interest only in the particular portion he
was occupying, which portion was completely different from the other portions individually occupied by other defendants, for the
applicable section 118 of the Code of Civil Procedure relates to a common and general interest in single specific things and not to distinct
ones.9In an action for the recovery of amounts that represented surcharges allegedly collected by the city from some 30,000 customers of
four movie houses, it was held that a class suit did not lie, as no one plaintiff had any right to, or any share in the amounts individually
claimed by the others, as each of them was entitled, if at all, only to the return of what he had personally paid. 10
The interest, subject matter of the class suits in the above cited cases, is analogous to the interest claimed by appellants in the instant
case. The interest that appellants, plaintiffs and intervenors, and the CMI stockholders had in the subject matter of this suit — the portion
of stocks offering of the Bank left unsubscribed by CMI stockholders who failed to exercise their right to subscribe on or before January
15, 1963 — was several, not common or general in the sense required by the statute. Each one of the appellants and the CMI stockholders
had determinable interest; each one had a right, if any, only to his respective portion of the stocks. No one of them had any right to, or
any interest in, the stock to which another was entitled. Anent this point, the trial court correctly remarked:
It appears to be the theory of the plaintiffs borne out by the prayer, that each subscribing CMI stockholder is
entitled to further subscribe to a certain Proportion depending upon his stockholding in the CMI, of the P8 million
capital stock of the defendant bank open to subscription (out of the 20 million authorized capital stock) as well as
the unsubscribed portion of the P8 million stock offering which were left unsubscribed by those CMI stockholders
who for one reason or another had failed to exercise their subscription rights on or before January 15, 1963. Under
the plaintiffs' theory therefore, each subscribing CMI stockholder was entitled to subscribe to a definite number of
shares both in the original offering of P8 million and in that part thereof not subscribed on or before the deadline
mentioned, so that one subscribing CMI stockholder may be entitled to subscribe to one share, another to 3 shares
and a third to 11 shares, and so on, depending upon the amount and extent of CMI stockholding. But except for the
fact that a question of law — the proper interpretation of the waiver provisions of the CMI stockholders' resolution
of March 28, 1962 — is common to all, each CMI subscribing stock holder has a legal interest in, and a claim to, only
his respective proportion of shares in the defendant bank, and none with regard to any of the shares to which
another stockholder is entitled. Thus plaintiff Ismael Mathay has no legal interest in, or claim to, any share claimed
by any or all of his co-plaintiffs from the defendant individuals. Hence, no CMI subscribing stockholder or, for that
matter, not any number of CMI stockholders can maintain a class suit in behalf of others,... 11
Even if it be assumed, for the sake of argument, that the appellants and the CMI stockholders suffered wrongs that had been committed
by similar means and even pursuant to a single plan of the Interim Board of Organizers of the Bank, the wrong suffered by each of them
would constitute a wrong separate from those suffered by the other stockholders, and those wrongs alone would not create that common
or general interest in the subject matter of the controversy as would entitle any one of them to bring a class suit on behalf of the others.
Anent this point it has been said that:
Separate wrongs to separate persons, although committed by similar means and even pursuant to a single plan, do
not alone create a 'common' or 'general' interest in those who are wronged so as to entitle them to maintain a
representative action. 12
Appellants, however, insisted, citing American authorities, 13 that a class suit might be brought even if the interests of plaintiffs-appellants
might be several as long as there was a common question of law or fact affecting them and a common relief was sought. We have no
conflict with the authorities cited; those were rulings under the Federal Rules of Civil Procedure, pursuant to Rule 23 of which, there were
three types of class suits, namely: the true, the hybrid, and the spurious, and these three had only one feature in common, that is, in each
the persons constituting the class must be so numerous as to make it impracticable to bring them all before the court. The authorities
cited by plaintiffs-appellants refer to the spurious class action (Rule 23 (a) (3) which involves a right sought to be enforced, which is
several, and there is a common question of law or fact affecting the several rights and a common relief is sought. 14 The spurious class
action is merely a permissive joinder device; between the members of the class there is no jural relationship, and the right or liability of
each is distinct, the class being formed solely by the presence of a common question of law or fact. 15 This permissive joinder is provided
in Section 6 of Rule 3, of our Rules of Court. Such joinder is not and cannot be regarded as a class suit, which this action purported and
was intended to be as per averment of the complaint.
It may be granted that the claims of all the appellants involved the same question of law. But this alone, as said above, did not constitute
the common interest over the subject matter indispensable in a class suit. The right to purchase or subscribe to the shares of the
proposed Bank, claimed by appellants herein, is analogous to the right of preemption that stockholders have when their corporation
increases its capital. The right to preemption, it has been said, is personal to each stockholder, 16 and while a stockholder may maintain a
suit to compel the issuance of his proportionate share of stock, it has been ruled, nevertheless, that he may not maintain a representative
action on behalf of other stockholders who are similarly situated. 17 By analogy, the right of each of the appellants to subscribe to the
waived stocks was personal, and no one of them could maintain on behalf of others similarly situated a representative suit.
Straining to make it appear that appellants and the CMI subscribing stockholders had a common or general interest in the subject matter
of the suit, appellants stressed in their brief that one of the reliefs sought in the instant action was "to divest defendant individuality and
the persons or entities chosen by them of control of the defendant bank." 18 This relief allegedly sought by appellants did not, however,
appear either in the text or in the prayer of the complaint.
Appellants, furthermore, insisted that insufficiency of number in a class suit was not a ground for dismissal of one action. This Court has,
however, said that where it appeared that no sufficient representative parties had been joined, the dismissal by the trial court of the
action, despite the contention by plaintiffs that it was a class suit, was correct. 19 Moreover, insofar as the instant case is concerned, even
if it be granted for the sake of argument, that the suit could not be dismissed on that ground, it could have been dismissed, nevertheless,
on the ground of lack of cause of action which will be presently discussed. .
2. Appellants supported their assigned error that the court erred in holding that the complaint stated no valid cause of action, by claiming
that paragraph 15 together with the other allegations of the complaint to the effect that defendants-appellees had unlawfully acquired
stockholdings in the capital stock of defendant-appellee Bank in excess of what they were lawfully entitled to, in violation of law and in
breach of trust and the contractual agreement, constituted a valid and sufficient cause of action; 20 and that only the allegations in the
complaint should have been considered by the trial court in determining whether the complaint stated a cause of action or not.
Defendants-appellees, on the contrary, maintained that the allegations of the complaint should not be the only ones to be considered in
determining whether there is a cause of action; that even if the ultimate facts alleged in the first cause of action of the complaint be the
only ones considered the complaint would still fail to state a valid cause of action on the following grounds: first, there was no allegation
regarding appellants' qualification to subscribe to the capital stock of the appellee Bank, for under the CMI stockholders' resolution of
March 28, 1962, only those qualified under the law were entitled to subscribe, and under the regulations of the Monetary Board, only
natural-born Filipino citizens could be stockholders of a banking corporation organized under the laws of the Philippines, and nowhere did
the complaint alleged that plaintiffs-appellants were natural born Filipino citizens. 21 Second, appellants' averment in paragraph 8 that
they "subscribed," and their averment in paragraph 15 that they were "denied the right to subscribe ... to the capital stock of the
defendant Bank", were inconsistent, and hence neutralized each other, thereby leaving in shambles the first cause of action. Third, there
was no allegation that appellants had not yet received or had not been issued the corresponding certificates of stock covering the shares
they had subscribed and paid for. Fourth, the allegations failed to show the existence of the supposed trust; and fifth, the complaint failed
to allege that plaintiffs-appellants had paid or offered to pay for the shares allegedly pertaining to them. 22
Let us premise the legal principles governing the motion to dismiss on the ground of lack of cause of action.
Section 1, Rule 16 of the Rules of Court providing in part that: .
Within the time for pleading a motion to dismiss may be made on any of the following grounds: ....
(g) That the complaint states no cause of action. ..1.
explicitly requires that the sufficiency of the complaint must be tested exclusively on the basis of the complaint itself and no other should
be considered when the ground for motion to dismiss is that the complaint states no cause of action. Pursuant thereto this Court has
ruled that:
As a rule the sufficiency of the complaint, when Challenged in a motion to dismiss, must be determined exclusively on the basis of the
facts alleged therein. 23
It has been likewise held that a motion to dismiss based on lack of cause of action hypothetically admits the truth of the allegations of fact
made in the complaint. 24 It is to be noted that only the facts well pleaded in the complaint, and likewise, any inferences fairly deducible
therefrom, are deemed admitted by a motion to dismiss. Neither allegations of conclusions 25 nor allegations of facts the falsity of which
the court may take judicial notice are deemed admitted. 26 The question, therefore, submitted to the Court in a motion to dismiss based
on lack of cause of action is not whether the facts alleged in the complaint are true, for these are hypothetically admitted, but whether
the facts alleged are sufficient to constitute a cause of action such that the court may render a valid judgment upon the facts alleged
therein.
A cause of action is an act or omission of one party in violation of the legal right of the other. Its essential elements are, namely: (1) the
existence of a legal right in the plaintiff, (2) a correlative legal duty in the defendant, and (3) an act or omission of the defendant in
violation of plaintiff's right with consequential injury or damage to the plaintiff for which he may maintain an action for the recovery of
damages or other appropriate relief. 27 On the other hand, Section 3 of Rule 6 of the Rules of Court provides that the complaint must state
the ultimate facts constituting the plaintiff's cause of action. Hence, where the complaint states ultimate facts that constitute the three
essential elements of a cause of action, the complaint states a cause of action; 28 otherwise, the complaint must succumb to a motion to
dismiss on that ground.
The legal principles having been premised, let us now analyze and discuss appellant's various causes of action.
Appellants' first cause of action, pursuant to what has been premised above, should have consisted of: (1) the right of appellants as well
as of the other CMI stockholders to subscribe, in proportion to their equities established under their respective "Pre-Incorporation
Agreements to Subscribe", to that portion of the capital stock which was unsubscribed because of failure of the CMI stockholders to
exercise their right to subscribe thereto; (2) the legal duty of the appellant to have said portion of the capital stock to be subscribed by
appellants and other CMI stockholders; and (3) the violation or breach of said right of appellants and other CMI stockholders by the
appellees.
Did the complaint state the important and substantial facts directly forming the basis of the primary right claimed by plaintiffs? Before
proceeding to elucidate this question, it should be noted that a bare allegation that one is entitled to something is an allegation of a
conclusion. Such allegations adds nothing to the pleading, it being necessary to plead specifically the facts upon which such conclusion is
founded. 29 The complaint alleged that appellants were stockholders of the CMI; that as such stockholders, they were entitled; by virtue of
the resolution of March 28, 1962, to subscribe to the capital stock of the proposed Consolidated Bank and Trust Co., at par value to the
same extent and in the same amount as said stockholders' respective share holdings in the CMI as shown in the latter's stock book as of
January 15, 1963, the right to subscribe to be exercised until January 15, 1963, provided said stockholders of the CMI were qualified under
the law to become stockholders of the proposed Bank; 30 that appellants accomplished and filed their respective "Pre-Incorporation
Agreements to Subscribe" and fully paid the subscription. 31
These alleged specific facts did not even show that appellants were entitled to subscribe to the capital stock of the proposed Bank, for
said right depended on a condition precedent, which was, that they were qualified under the law to become stockholders of the Bank,
and there was no direct averment in the complaint of the facts that qualified them to become stockholders of the Bank. The allegation of
the fact that they subscribed to the stock did not, by necessary implication, show that they were possessed of the necessary qualifications
to become stockholders of the proposed Bank.
Assuming arguendo that appellants were qualified to become stockholders of the Bank, they could subscribe, pursuant to the explicit
terms of the resolution of March 28, 1962, "to the same extent and in the same amount as said stockholders' respective stockholdings in
the CMI" as of January 15, 1963. 32 This was the measure of the right they could claim to subscribe to waived stocks. Appellants did not
even aver that the stocks waived to the subscription of which they claimed the right to subscribe, were comprised in "the extent and
amount" of their respective share holdings in the CMI. It is not surprising that they did not make such an averment for they did not even
allege the amount of shares of stock to which they claimed they were entitled to subscribe. The failure of the complaint to plead
specifically the above facts rendered it impossible for the court to conclude by natural reasoning that the appellants and other CMI
stockholders had a right to subscribe to the waived shares of stock, and made any allegation to that effect a conclusion of the pleader, not
an ultimate fact, in accordance with the test suggested by the California Supreme Court, to wit:
If from the facts in evidence, the result can be reached by that process of natural reasoning adopted in the
investigation of truth, it becomes an ultimate fact, to be found as such. If, on the other hand, resort must be had to
the artificial processes of the law, in order to reach a final determination, the result is a conclusion of law. 33
Let us now pass to the second and third elements that would have constituted the first cause of action. Did the complaint allege as
ultimate facts the legal duty of defendants-appellees to have a portion of the capital stock subscribed to by appellants? Did the complaint
allege as ultimate facts that defendants appellees had violated appellants' right?
Even if it be assumed arguendo that defendants-appellees had the duty to have the waived stocks subscribed to by the CMI stockholders,
this duty was not owed to all the CMI stockholders, but only to such CMI stockholders as were qualified to become stockholders of the
proposed Bank. Inasmuch as it has been shown that the complaint did not contain ultimate facts to show that plaintiffs-appellants were
qualified to become stockholders of the Bank, it follows that the complaint did not show that defendants-appellees were under duty to
have plaintiffs-appellants subscribe to the stocks of the proposed Bank. It inevitably follows also that the complaint did not contain
ultimate facts to show that the right of the plaintiffs-appellants to subscribe to the shares of the proposed Bank had been violated by
defendants-appellees. How could a non-existent right be violated?
Let us continue the discussion further. The complaint alleged that by virtue of the resolution of March 28, 1962, the President and
Members of the Board of Directors of the CMI would be constituted as a Board of Organizers to undertake and carry out the organization
of the Bank; 34 that the Board of Organizers was constituted and proceeded with the establishment of the Bank, 35 that the persons
composing the Board of Organizers were the individuals-defendants-appellees; 36 that the Board of Organizers sent our circular letters
with "Pre-Incorporation Agreement to Subscribe" forms 37 which specified, among others, "such subscription right shall be deemed ipso
facto waived and released in favor of the Board of Organizers of the defendant Bank and their assignees"; 38 that in the Articles of
Incorporation prepared by the Board of Organizers, the individuals-defendants-appellees alone appeared to have subscribe to the 50,
shares; 39 and that individuals-defendants-appellees again subscribe to all the additional 30,000 shares. 40 From these facts, appellants
concluded that they were denied their right to subscribe in proportion to their equities; 41 that the individuals-defendants-appellees
unlawfully acquired stockholdings far in excess of what they were lawfully entitled in violation of law and in breach of trust and of
contractual agreement; 42and that, because of matters already alleged, the individuals-defendants-appellees "hold their shares in the
defendant bank in trust for plaintiffs." 43
The allegation in the complaint that the individuals-defendants-appellees held their shares "in trust" for plaintiffs-appellants without
averment of the facts from which the court could conclude the existence of the alleged trust, was not deemed admitted by the motion to
dismiss for that was a conclusion of law. Express averments "that a party was the beneficial owner of certain property; ... that property or
money was received or held in trust, or for the use of another; that particular funds were trust funds; that a particular transaction created
an irrevocable trust; that a person held Property as constructive trustee; that on the transfer of certain property a trust resulted" have
been considered as mere conclusions of law. 44 The facts alleged in the complaint did not, by logical reasoning, necessarily lead to the
conclusion that defendants-appellees were trustees in favor of appellants of the shares of stock waived by the CMI stockholders who
failed to exercise their right to subscribe. In this connection, it has been likewise said that:
"The general rule is that an allegation of duty in terms unaccompanied by a statement of the facts showing the existence of the duty, is a
mere conclusion of law, unless there is a relation set forth from which the law raises the duty." 45
In like manner, the allegation that individuals-defendants-appellees held said shares in trust was no more than an interpretation by
appellants of the effect of the waiver clause of the Resolution and as such it was again a mere conclusion of law. It has been said that:
The following are also conclusions of law: ... an allegation characterizing an instrument or purporting to interpret it
and state its effects, ... 46
Allegations in petition in the nature of conclusions about the meaning of contract, inconsistent with stated terms of the contract, cannot
be considered. 47
The allegation that the defendants-appellee acquired stockholdings far in excess of what they were lawfully entitled, in violation of law
and in breach of trust and of contractual agreement, is also mere conclusion of law.
Of course, the allegation that there was a violation of trust duty was plainly a conclusion of law, for "a mere allegation that it was the duty
of a party to do this or that, or that he was guilty of a breach of duty, is a statement of a conclusion not of fact." 48
An averment ... that an act was 'unlawful' or 'wrongful' is a mere legal conclusion or opinion of the pleader. 49
Moreover, plaintiffs-appellants did not state in the complaint the amount of subscription the individual defendant-appellee were entitled
to; hence there was no basis for the court to determine what amount subscribed to by them was excessive.
From what has been said, it is clear that the ultimate facts stated under the first cause of action are not sufficient to constitute a cause of
action.
The further allegations in the second cause of action that the calling of a special meeting was "falsely certified", that the seventh position
of Director was "illegally created" and that defendant Alfonso Juan Olondriz was "not competent or qualified" to be a director are mere
conclusions of law, the same not being necessarily inferable from the ultimate facts stated in the first and second causes of action. It has
been held in this connection that:
An averment that ... an act was 'unlawful' or 'wrongful' is a mere legal conclusion or opinion of the pleader. The
same is true of allegations that an instrument was 'illegally' certified or ... that an act was arbitrarily done ..." 50
A pleader states a mere conclusion when he makes any of the following allegations: that a party was incapacitated
to enter into a contract or convey
property ... 51
The third, fourth, fifth and sixth causes of action depended on the first cause of action, which, as has been shown, did not state ultimate
facts sufficient to constitute a cause of action. It stands to reason, therefore, that said causes of action would also be fatally defective.
It having been shown that the complaint failed to state ultimate facts to constitute a cause of action, it becomes unnecessary to discuss
the other assignments of errors.
WHEREFORE, the instant appeal is dismissed, and the order dated March 21, 1964 of the Court of First Instance of Manila dismissing the
complaint in Civil Case No. 55810 is affirmed, with costs in this instance against appellants. It is so ordered.
Fernando, Barredo, Fernandez and Aquino, JJ, concur.
Antonio, J., took no part.
G.R. No. L-63559 May 30, 1986
NEWSWEEK, INC., petitioner,
vs.
THE INTERMEDIATE APPELLATE COURT, and NATIONAL FEDERATION OF SUGARCANE PLANTERS INC., BINALBAGAN-ISABELA PLANTERS
ASSOCIATION, INC., ASOCIACION DE AGRICULTORES DE LA CARLOTA, LA CASTELLANA y PONTEVEDRA, INC., DONEDCO PLANTERS
ASSOCIATION INC., ARMANDO GUSTILO, ENRIQUE ROJAS, ALFREDO MONTELIBANO, JR., PABLO SOLA, JOSE MONTALVO, VICENTE
GUSTILO, JOSEPH MARANON, ROBERTO CUENCA, JOSE SICANGCO, FLORENCIO ALONSO, MIGUEL GATUSLAO, PEDRO YULO, MARINO
RUBIN and BENJAMIN BAUTISTA, respondents.
San Juan, Africa, Gonzales & San Agustin Law Offices for private respondents.
FERIA, J.:
Petitioner, Newsweek, Inc., a foreign corporation licensed to do business in the Philippines, in this special action for certiorari, prohibition
with preliminary injunction, seeks to annul the decision of the Intermediate Appellate Court dated December 17, 1982 sustaining the
Order of the then Court of First Instance of Bacolod City which denied petitioner's Motion to Dismiss the complaint for libel filed by
private respondents (Civil Case No. 15812), and the Resolution dated March 10, 1983 which denied its Motion for Reconsideration.
It appears that on March 5, 1981, private respondents, incorporated associations of sugarcane planters in Negros Occidental claiming to
have 8,500 members and several individual sugar planters, filed Civil Case No. 15812 in their own behalf and/or as a class suit in behalf of
all sugarcane planters in the province of Negros Occidental, against petitioner and two of petitioners' non-resident
correspondents/reporters Fred Bruning and Barry Came. The complaint alleged that petitioner and the other defendants committed libel
against them by the publication of the article "An Island of Fear" in the February 23, 1981 issue of petitioner's weekly news
magazine Newsweek. The article supposedly portrayed the island province of Negros Occidental as a place dominated by big landowners
or sugarcane planters who not only exploited the impoverished and underpaid sugarcane workers/laborers, but also brutalized and killed
them with imprunity. Complainants therein alleged that said article, taken as a whole, showed a deliberate and malicious use of
falsehood, slanted presentation and/or misrepresentation of facts intended to put them (sugarcane planters) in bad light, expose them to
public ridicule, discredit and humiliation here in the Philippines and abroad, and make them objects of hatred, contempt and hostility of
their agricultural workers and of the public in general. They prayed that defendants be ordered to pay them PlM as actual and
compensatory damages, and such amounts for moral, exemplary and corrective damages as the court may determine, plus expenses of
litigation, attorney's fees and costs of suit. A photo copy of the article was attached to the complaint.
On November 5, 1981, petitioner filed a motion to dismiss on the grounds that (1) the printed article sued upon is not actionable in fact
and in law; and (2) the complaint is bereft of allegations that state, much less support a cause of action. It pointed out the non-libelous
nature of the article and, consequently, the failure of the complaint to state a cause of action. Private respondents filed an Opposition to
the motion to dismiss and petitioner filed a reply.
On March 17, 1982, the trial court denied the motion to dismiss, stating that the grounds on which the motion to dismiss are predicated
are not indubitable as the complaint on its face states a valid cause of action; and the question as to whether the printed article sued
upon its actionable or not is a matter of evidence. Petitioner's motion for reconsideration was denied on May 28, 1982.
On June 18, 1982, petitioner filed a petition for certiorari with respondent Court (CA-G. R. No. 14406) seeking the annulment of the
aforecited trial court's Orders for having been issued with such a grave abuse of discretion as amounting to lack of jurisdiction and praying
for the dismissal of the complaint for failure to state a cause of action.
As earlier stated, respondent Court affirmed the trial court's Orders in a Decision dated December 17, 1982 and ordered the case to be
tried on the merits on the grounds that -(1) the complaint contains allegations of fact which called for the presentation of evidence; and
(2) certiorari under Rule 65 cannot be made to substitute for an appeal where an appeal would lie at a proper time. Subsequently, on
March 10, 1983, the respondent Court denied petitioner's Motion for Reconsideration of the aforesaid decision, hence this petition.
The proper remedy which petitioner should have taken from the decision of respondent Court is an appeal by certiorari under Rule 45 of
the Rules of Court and not the special civil action of certiorari and prohibition under Rule 65 of said Rules. However, since the petition was
filed on time within fifteen days from notice of the Resolution denying the motion for reconsideration, we shall treat the same as a
petition for review on certiorari. The two (2) issues raised in the petition are: (1) whether or not the private respondents' complaint failed
to state a cause of action; and (2) whether or not the petition for certiorari and prohibition is proper to question the denial of a motion to
dismiss for failure to state a cause of action.
First, petitioner argues that private respondents' complaint failed to state a cause of action because the complaint made no allegation
that anything contained in the article complained of regarding sugarcane planters referred specifically to any one of the private
respondents; that libel can be committed only against individual reputation; and that in cases where libel is claimed to have been directed
at a group, there is actionable defamation only if the libel can be said to reach beyond the mere collectivity to do damage to a specific,
individual group member's reputation.
We agree with petitioner.
In the case of Corpus vs. Cuaderno, Sr. (16 SCRA 807) this Court ruled that "in order to maintain a libel suit, it is essential that the victim be
identifiable (People vs. Monton, L-16772, November 30, 1962), although it is not necessary that he be named (19 A.L.R. 116)." In an earlier
case, this Court declared that" ... defamatory matter which does not reveal the Identity of the person upon whom the imputation is cast,
affords no ground of action unless it be shown that the readers of the libel could have Identified the personality of the individual
defamed." (Kunkle vs. Cablenews-American and Lyons 42 Phil. 760).
This principle has been recognized to be of vital importance, especially where a group or class of persons, as in the case at bar, claim to
have been defamed, for it is evident that the larger the collectivity, the more difficult it is for the individual member to prove that the
defamatory remarks apply to him. (Cf. 70 ALR 2d. 1384).
In the case of Uy Tioco vs. Yang Shu Wen , 32 Phil. 624, this Court held as follows:
Defamatory remarks directed at a class or group of persons in general language only, are not actionable by
individuals composing the class or group unless the statements are sweeping; and it is very probable that even then
no action would lie where the body is composed of so large a number of persons that common sense would tell
those to whom the publication was made that there was room for persons connected with the body to pursue an
upright and law abiding course and that it would be unreasonable and absurd to condemn all because of the actions
of a part. (supra p. 628).
It is evident from the above ruling that where the defamation is alleged to have been directed at a group or class, it is essential that the
statement must be so sweeping or all-embracing as to apply to every individual in that group or class, or sufficiently specific so that each
individual in the class or group can prove that the defamatory statement specifically pointed to him, so that he can bring the action
separately, if need be.
We note that private respondents filed a "class suit" in representation of all the 8,500 sugarcane planters of Negros Occidental. Petitioner
disagrees and argues that the absence of any actionable basis in the complaint cannot be cured by the filing of a class suit on behalf of the
aforesaid sugar planters.
We find petitioner's contention meritorious.
The case at bar is not a class suit. It is not a case where one or more may sue for the benefit of all (Mathay vs. Consolidated Bank and
Trust Company, 58 SCRA 559) or where the representation of class interest affected by the judgment or decree is indispensable to make
each member of the class an actual party (Borlaza vs. Polistico, 47 Phil. 348). We have here a case where each of the plaintiffs has a
separate and distinct reputation in the community. They do not have a common or general interest in the subject matter of the
controversy.
The disputed portion of the article which refers to plaintiff Sola and which was claimed to be libelous never singled out plaintiff Sola as a
sugar planter. The news report merely stated that the victim had been arrested by members of a special police unit brought into the area
by Pablo Sola, the mayor of Kabankalan. Hence, the report, referring as it does to an official act performed by an elective public official, is
within the realm of privilege and protected by the constitutional guarantees of free speech and press.
The article further stated that Sola and the commander of the special police unit were arrested. The Court takes judicial notice of this fact.
(People vs. Sola, 103 SCRA 393.)
The second issue to be resolved here is whether or not the special civil action of certiorari or prohibition is available to petitioner whose
motion to dismiss the complaint and subsequent motion for reconsideration were denied.
As a general rule, an order denying a motion to dismiss is merely interlocutory and cannot be subject of appeal until final judgment or
order is rendered. (Sec. 2 of Rule 4 1). The ordinary procedure to be followed in such a case is to file an answer, go to trial and if the
decision is adverse, reiterate the issue on appeal from the final judgment. The same rule applies to an order denying a motion to quash,
except that instead of filing an answer a plea is entered and no appeal lies from a judgment of acquittal.
This general rule is subject to certain exceptions. If the court, in denying the motion to dismiss or motion to quash, acts without or in
excess of jurisdiction or with grave abuse of discretion, then certiorari or prohibition lies. The reason is that it would be unfair to require
the defendant or accused to undergo the ordeal and expense of a trial if the court has no jurisdiction over the subject matter or offense,
or is not the court of proper venue, or if the denial of the motion to dismiss or motion to quash is made with grave abuse of discretion or
a whimsical and capricious exercise of judgment. In such cases, the ordinary remedy of appeal cannot be plain and adequate. The
following are a few examples of the exceptions to the general rule.
In De Jesus vs. Garcia (19 SCRA 554), upon the denial of a motion to dismiss based on lack of jurisdiction over the subject matter, this
Court granted the petition for certiorari and prohibition against the City Court of Manila and directed the respondent court to dismiss the
case.
In Lopez vs. City Judge (18 SCRA 616), upon the denial of a motion to quash based on lack of jurisdiction over the offense, this Court
granted the petition for prohibition and enjoined the respondent court from further proceeding in the case.
In Enriquez vs. Macadaeg (84 Phil. 674), upon the denial of a motion to dismiss based on improper venue, this Court granted the petition
for prohibition and enjoined the respondent judge from taking cognizance of the case except to dismiss the same.
In Manalo vs. Mariano (69 SCRA 80), upon the denial of a motion to dismiss based on bar by prior judgment, this Court granted the
petition for certiorari and directed the respondent judge to dismiss the case.
In Yuviengco vs. Dacuycuy (105 SCRA 668), upon the denial of a motion to dismiss based on the Statute of Frauds, this Court granted the
petition for certiorari and dismissed the amended complaint.
In Tacas vs. Cariaso (72 SCRA 527), this Court granted the petition for certiorari after the motion to quash based on double jeopardy was
denied by respondent judge and ordered him to desist from further action in the criminal case except to dismiss the same.
In People vs. Ramos (83 SCRA 11), the order denying the motion to quash based on prescription was set aside on certiorari and the
criminal case was dismissed by this Court.
Respondent Court correctly stated the general rule and its exceptions. However, it ruled that none of the exceptions is present in the case
at bar and that the case appears complex and complicated, necessitating a full-blown trial to get to the bottom of the controversy.
Petitioner's motion to dismiss is based on the ground that the complaint states no cause of action against it by pointing out the non-
libelous nature of the article sued upon. There is no need of a trial in view of the conclusion of this Court that the article in question is not
libelous. The specific allegation in the complaint, to the effect that the article attributed to the sugarcane planters the deaths and
brutalization of sugarcane workers, is not borne out by a perusal of the actual text.
The complaint contains a recital of the favorable working conditions of the agricultural workers in the sugar industry and the various
foundations and programs supported by planters' associations for the benefit of their workers. Undoubtedly, the statements in the article
in question are sweeping and exaggerated; but, paraphrasing the ruling in the Uy Tioco case above quoted, it would be unreasonable and
absurd to condemn the majority of the sugarcane planters, who have at heart the welfare of their workers, because of the actions of a
part. Nonetheless, articles such as the one in question may also serve to prick the consciences of those who have but are not doing
anything or enough for those who do not have.
On the other hand, petitioner would do well to heed the admonition of the President to media that they should check the sources of their
information to ensure the publication of the truth. Freedom of the press, like all freedoms, should be exercised with responsibility.
WHEREFORE, the decision of the Intermediate Appellate Court is reversed and the complaint in Civil Case No. 15812 of the Court of First
Instance of Negros Occidental is dismissed, without pronouncement as to costs.
SO ORDERED.
Teehankee, C.J., Abad Santos, Yap, Fernan, Narvasa, Melencio-Herrera, Alampay, Gutierrez, Jr., Cruz and Paras, JJ., concur.
G.R. No. 101083 July 30, 1993
JUAN ANTONIO, ANNA ROSARIO and JOSE ALFONSO, all surnamed OPOSA, minors, and represented by their parents ANTONIO and
RIZALINA OPOSA, ROBERTA NICOLE SADIUA, minor, represented by her parents CALVIN and ROBERTA SADIUA, CARLO, AMANDA
SALUD and PATRISHA, all surnamed FLORES, minors and represented by their parents ENRICO and NIDA FLORES, GIANINA DITA R.
FORTUN, minor, represented by her parents SIGRID and DOLORES FORTUN, GEORGE II and MA. CONCEPCION, all surnamed MISA,
minors and represented by their parents GEORGE and MYRA MISA, BENJAMIN ALAN V. PESIGAN, minor, represented by his parents
ANTONIO and ALICE PESIGAN, JOVIE MARIE ALFARO, minor, represented by her parents JOSE and MARIA VIOLETA ALFARO, MARIA
CONCEPCION T. CASTRO, minor, represented by her parents FREDENIL and JANE CASTRO, JOHANNA DESAMPARADO,
minor, represented by her parents JOSE and ANGELA DESAMPRADO, CARLO JOAQUIN T. NARVASA, minor, represented by his parents
GREGORIO II and CRISTINE CHARITY NARVASA, MA. MARGARITA, JESUS IGNACIO, MA. ANGELA and MARIE GABRIELLE, all surnamed
SAENZ, minors, represented by their parents ROBERTO and AURORA SAENZ, KRISTINE, MARY ELLEN, MAY, GOLDA MARTHE and DAVID
IAN, all surnamed KING, minors, represented by their parents MARIO and HAYDEE KING, DAVID, FRANCISCO and THERESE VICTORIA, all
surnamed ENDRIGA, minors, represented by their parents BALTAZAR and TERESITA ENDRIGA, JOSE MA. and REGINA MA., all surnamed
ABAYA, minors, represented by their parents ANTONIO and MARICA ABAYA, MARILIN, MARIO, JR. and MARIETTE, all surnamed
CARDAMA, minors, represented by their parents MARIO and LINA CARDAMA, CLARISSA, ANN MARIE, NAGEL, and IMEE LYN, all
surnamed OPOSA, minors and represented by their parents RICARDO and MARISSA OPOSA, PHILIP JOSEPH, STEPHEN JOHN and ISAIAH
JAMES, all surnamed QUIPIT, minors, represented by their parents JOSE MAX and VILMI QUIPIT, BUGHAW CIELO, CRISANTO, ANNA,
DANIEL and FRANCISCO, all surnamed BIBAL, minors, represented by their parents FRANCISCO, JR. and MILAGROS BIBAL, and THE
PHILIPPINE ECOLOGICAL NETWORK, INC., petitioners,
vs.
THE HONORABLE FULGENCIO S. FACTORAN, JR., in his capacity as the Secretary of the Department of Environment and Natural
Resources, and THE HONORABLE ERIBERTO U. ROSARIO, Presiding Judge of the RTC, Makati, Branch 66, respondents.
Oposa Law Office for petitioners.
The Solicitor General for respondents.
DAVIDE, JR., J.:
In a broader sense, this petition bears upon the right of Filipinos to a balanced and healthful ecology which the petitioners dramatically
associate with the twin concepts of "inter-generational responsibility" and "inter-generational justice." Specifically, it touches on the issue
of whether the said petitioners have a cause of action to "prevent the misappropriation or impairment" of Philippine rainforests and
"arrest the unabated hemorrhage of the country's vital life support systems and continued rape of Mother Earth."
The controversy has its genesis in Civil Case No. 90-77 which was filed before Branch 66 (Makati, Metro Manila) of the Regional Trial Court
(RTC), National Capital Judicial Region. The principal plaintiffs therein, now the principal petitioners, are all minors duly represented and
joined by their respective parents. Impleaded as an additional plaintiff is the Philippine Ecological Network, Inc. (PENI), a domestic, non-
stock and non-profit corporation organized for the purpose of, inter alia, engaging in concerted action geared for the protection of our
environment and natural resources. The original defendant was the Honorable Fulgencio S. Factoran, Jr., then Secretary of the
Department of Environment and Natural Resources (DENR). His substitution in this petition by the new Secretary, the Honorable Angel C.
Alcala, was subsequently ordered upon proper motion by the petitioners.1 The complaint2 was instituted as a taxpayers' class suit3 and
alleges that the plaintiffs "are all citizens of the Republic of the Philippines, taxpayers, and entitled to the full benefit, use and enjoyment
of the natural resource treasure that is the country's virgin tropical forests." The same was filed for themselves and others who are
equally concerned about the preservation of said resource but are "so numerous that it is impracticable to bring them all before the
Court." The minors further asseverate that they "represent their generation as well as generations yet unborn." 4 Consequently, it is
prayed for that judgment be rendered:
. . . ordering defendant, his agents, representatives and other persons acting in his behalf to —
(1) Cancel all existing timber license agreements in the country;
(2) Cease and desist from receiving, accepting, processing, renewing or approving new timber license agreements.
and granting the plaintiffs ". . . such other reliefs just and equitable under the premises."5
The complaint starts off with the general averments that the Philippine archipelago of 7,100 islands has a land area of thirty million
(30,000,000) hectares and is endowed with rich, lush and verdant rainforests in which varied, rare and unique species of flora and fauna
may be found; these rainforests contain a genetic, biological and chemical pool which is irreplaceable; they are also the habitat of
indigenous Philippine cultures which have existed, endured and flourished since time immemorial; scientific evidence reveals that in order
to maintain a balanced and healthful ecology, the country's land area should be utilized on the basis of a ratio of fifty-four per cent (54%)
for forest cover and forty-six per cent (46%) for agricultural, residential, industrial, commercial and other uses; the distortion and
disturbance of this balance as a consequence of deforestation have resulted in a host of environmental tragedies, such as (a) water
shortages resulting from drying up of the water table, otherwise known as the "aquifer," as well as of rivers, brooks and streams, (b)
salinization of the water table as a result of the intrusion therein of salt water, incontrovertible examples of which may be found in the
island of Cebu and the Municipality of Bacoor, Cavite, (c) massive erosion and the consequential loss of soil fertility and agricultural
productivity, with the volume of soil eroded estimated at one billion (1,000,000,000) cubic meters per annum — approximately the size of
the entire island of Catanduanes, (d) the endangering and extinction of the country's unique, rare and varied flora and fauna, (e) the
disturbance and dislocation of cultural communities, including the disappearance of the Filipino's indigenous cultures, (f) the siltation of
rivers and seabeds and consequential destruction of corals and other aquatic life leading to a critical reduction in marine resource
productivity, (g) recurrent spells of drought as is presently experienced by the entire country, (h) increasing velocity of typhoon winds
which result from the absence of windbreakers, (i) the floodings of lowlands and agricultural plains arising from the absence of the
absorbent mechanism of forests, (j) the siltation and shortening of the lifespan of multi-billion peso dams constructed and operated for
the purpose of supplying water for domestic uses, irrigation and the generation of electric power, and (k) the reduction of the earth's
capacity to process carbon dioxide gases which has led to perplexing and catastrophic climatic changes such as the phenomenon of global
warming, otherwise known as the "greenhouse effect."
Plaintiffs further assert that the adverse and detrimental consequences of continued and deforestation are so capable of unquestionable
demonstration that the same may be submitted as a matter of judicial notice. This notwithstanding, they expressed their intention to
present expert witnesses as well as documentary, photographic and film evidence in the course of the trial.
As their cause of action, they specifically allege that:
CAUSE OF ACTION
7. Plaintiffs replead by reference the foregoing allegations.
8. Twenty-five (25) years ago, the Philippines had some sixteen (16) million hectares of rainforests constituting
roughly 53% of the country's land mass.
9. Satellite images taken in 1987 reveal that there remained no more than 1.2 million hectares of said rainforests or
four per cent (4.0%) of the country's land area.
10. More recent surveys reveal that a mere 850,000 hectares of virgin old-growth rainforests are left, barely 2.8% of
the entire land mass of the Philippine archipelago and about 3.0 million hectares of immature and uneconomical
secondary growth forests.
11. Public records reveal that the defendant's, predecessors have granted timber license agreements ('TLA's') to
various corporations to cut the aggregate area of 3.89 million hectares for commercial logging purposes.
A copy of the TLA holders and the corresponding areas covered is hereto attached as Annex "A".
12. At the present rate of deforestation, i.e. about 200,000 hectares per annum or 25 hectares per hour —
nighttime, Saturdays, Sundays and holidays included — the Philippines will be bereft of forest resources after the
end of this ensuing decade, if not earlier.
13. The adverse effects, disastrous consequences, serious injury and irreparable damage of this continued trend of
deforestation to the plaintiff minor's generation and to generations yet unborn are evident and incontrovertible. As
a matter of fact, the environmental damages enumerated in paragraph 6 hereof are already being felt, experienced
and suffered by the generation of plaintiff adults.
 14. The continued allowance by defendant of TLA holders to cut and deforest the remaining forest stands will work
great damage and irreparable injury to plaintiffs — especially plaintiff minors and their successors — who may
never see, use, benefit from and enjoy this rare and unique natural resource treasure.
This act of defendant constitutes a misappropriation and/or impairment of the natural resource property he holds
in trust for the benefit of plaintiff minors and succeeding generations.
15. Plaintiffs have a clear and constitutional right to a balanced and healthful ecology and are entitled to protection
by the State in its capacity as the parens patriae.
16. Plaintiff have exhausted all administrative remedies with the defendant's office. On March 2, 1990, plaintiffs
served upon defendant a final demand to cancel all logging permits in the country.
A copy of the plaintiffs' letter dated March 1, 1990 is hereto attached as Annex "B".
17. Defendant, however, fails and refuses to cancel the existing TLA's to the continuing serious damage and extreme
prejudice of plaintiffs.
18. The continued failure and refusal by defendant to cancel the TLA's is an act violative of the rights of plaintiffs,
especially plaintiff minors who may be left with a country that is desertified (sic), bare, barren and devoid of the
wonderful flora, fauna and indigenous cultures which the Philippines had been abundantly blessed with.
19. Defendant's refusal to cancel the aforementioned TLA's is manifestly contrary to the public policy enunciated in
the Philippine Environmental Policy which, in pertinent part, states that it is the policy of the State —
(a) to create, develop, maintain and improve conditions under which man and nature can thrive in productive and
enjoyable harmony with each other;
(b) to fulfill the social, economic and other requirements of present and future generations of Filipinos and;
(c) to ensure the attainment of an environmental quality that is conductive to a life of dignity and well-being. (P.D.
1151, 6 June 1977)
20. Furthermore, defendant's continued refusal to cancel the aforementioned TLA's is contradictory to the
Constitutional policy of the State to —
a. effect "a more equitable distribution of opportunities, income and wealth" and "make full and efficient use of
natural resources (sic)." (Section 1, Article XII of the Constitution);
b. "protect the nation's marine wealth." (Section 2, ibid);
c. "conserve and promote the nation's cultural heritage and resources (sic)" (Section 14, Article XIV, id.);
d. "protect and advance the right of the people to a balanced and healthful ecology in accord with the rhythm and
harmony of nature." (Section 16, Article II, id.)
21. Finally, defendant's act is contrary to the highest law of humankind — the natural law — and violative of
plaintiffs' right to self-preservation and perpetuation.
22. There is no other plain, speedy and adequate remedy in law other than the instant action to arrest the unabated
hemorrhage of the country's vital life support systems and continued rape of Mother Earth. 6
On 22 June 1990, the original defendant, Secretary Factoran, Jr., filed a Motion to Dismiss the complaint based on two (2) grounds,
namely: (1) the plaintiffs have no cause of action against him and (2) the issue raised by the plaintiffs is a political question which properly
pertains to the legislative or executive branches of Government. In their 12 July 1990 Opposition to the Motion, the petitioners maintain
that (1) the complaint shows a clear and unmistakable cause of action, (2) the motion is dilatory and (3) the action presents a justiciable
question as it involves the defendant's abuse of discretion.
On 18 July 1991, respondent Judge issued an order granting the aforementioned motion to dismiss.7 In the said order, not only was the
defendant's claim — that the complaint states no cause of action against him and that it raises a political question — sustained, the
respondent Judge further ruled that the granting of the relief prayed for would result in the impairment of contracts which is prohibited
by the fundamental law of the land.
Plaintiffs thus filed the instant special civil action for certiorari under Rule 65 of the Revised Rules of Court and ask this Court to rescind
and set aside the dismissal order on the ground that the respondent Judge gravely abused his discretion in dismissing the action. Again,
the parents of the plaintiffs-minors not only represent their children, but have also joined the latter in this case.8
On 14 May 1992, We resolved to give due course to the petition and required the parties to submit their respective Memoranda after the
Office of the Solicitor General (OSG) filed a Comment in behalf of the respondents and the petitioners filed a reply thereto.
Petitioners contend that the complaint clearly and unmistakably states a cause of action as it contains sufficient allegations concerning
their right to a sound environment based on Articles 19, 20 and 21 of the Civil Code (Human Relations), Section 4 of Executive Order (E.O.)
No. 192 creating the DENR, Section 3 of Presidential Decree (P.D.) No. 1151 (Philippine Environmental Policy), Section 16, Article II of the
1987 Constitution recognizing the right of the people to a balanced and healthful ecology, the concept of generational genocide in
Criminal Law and the concept of man's inalienable right to self-preservation and self-perpetuation embodied in natural law. Petitioners
likewise rely on the respondent's correlative obligation per Section 4 of E.O. No. 192, to safeguard the people's right to a healthful
environment.
It is further claimed that the issue of the respondent Secretary's alleged grave abuse of discretion in granting Timber License Agreements
(TLAs) to cover more areas for logging than what is available involves a judicial question.
Anent the invocation by the respondent Judge of the Constitution's non-impairment clause, petitioners maintain that the same does not
apply in this case because TLAs are not contracts. They likewise submit that even if TLAs may be considered protected by the said clause,
it is well settled that they may still be revoked by the State when the public interest so requires.
On the other hand, the respondents aver that the petitioners failed to allege in their complaint a specific legal right violated by the
respondent Secretary for which any relief is provided by law. They see nothing in the complaint but vague and nebulous allegations
concerning an "environmental right" which supposedly entitles the petitioners to the "protection by the state in its capacity as parens
patriae." Such allegations, according to them, do not reveal a valid cause of action. They then reiterate the theory that the question of
whether logging should be permitted in the country is a political question which should be properly addressed to the executive or
legislative branches of Government. They therefore assert that the petitioners' resources is not to file an action to court, but to lobby
before Congress for the passage of a bill that would ban logging totally.
As to the matter of the cancellation of the TLAs, respondents submit that the same cannot be done by the State without due process of
law. Once issued, a TLA remains effective for a certain period of time — usually for twenty-five (25) years. During its effectivity, the same
can neither be revised nor cancelled unless the holder has been found, after due notice and hearing, to have violated the terms of the
agreement or other forestry laws and regulations. Petitioners' proposition to have all the TLAs indiscriminately cancelled without the
requisite hearing would be violative of the requirements of due process.
Before going any further, We must first focus on some procedural matters. Petitioners instituted Civil Case No. 90-777 as a class suit. The
original defendant and the present respondents did not take issue with this matter. Nevertheless, We hereby rule that the said civil case is
indeed a class suit. The subject matter of the complaint is of common and general interest not just to several, but to all citizens of the
Philippines. Consequently, since the parties are so numerous, it, becomes impracticable, if not totally impossible, to bring all of them
before the court. We likewise declare that the plaintiffs therein are numerous and representative enough to ensure the full protection of
all concerned interests. Hence, all the requisites for the filing of a valid class suit under Section 12, Rule 3 of the Revised Rules of Court are
present both in the said civil case and in the instant petition, the latter being but an incident to the former.
This case, however, has a special and novel element. Petitioners minors assert that they represent their generation as well as generations
yet unborn. We find no difficulty in ruling that they can, for themselves, for others of their generation and for the succeeding generations,
file a class suit. Their personality to sue in behalf of the succeeding generations can only be based on the concept of intergenerational
responsibility insofar as the right to a balanced and healthful ecology is concerned. Such a right, as hereinafter expounded, considers
the "rhythm and harmony of nature." Nature means the created world in its entirety.9 Such rhythm and harmony indispensably
include, inter alia, the judicious disposition, utilization, management, renewal and conservation of the country's forest, mineral, land,
waters, fisheries, wildlife, off-shore areas and other natural resources to the end that their exploration, development and utilization be
equitably accessible to the present as well as future generations. 10Needless to say, every generation has a responsibility to the next to
preserve that rhythm and harmony for the full enjoyment of a balanced and healthful ecology. Put a little differently, the minors'
assertion of their right to a sound environment constitutes, at the same time, the performance of their obligation to ensure the protection
of that right for the generations to come.
The locus standi of the petitioners having thus been addressed, We shall now proceed to the merits of the petition.
After a careful perusal of the complaint in question and a meticulous consideration and evaluation of the issues raised and arguments
adduced by the parties, We do not hesitate to find for the petitioners and rule against the respondent Judge's challenged order for having
been issued with grave abuse of discretion amounting to lack of jurisdiction. The pertinent portions of the said order reads as follows:
xxx xxx xxx
After a careful and circumspect evaluation of the Complaint, the Court cannot help but agree with the defendant.
For although we believe that plaintiffs have but the noblest of all intentions, it (sic) fell short of alleging, with
sufficient definiteness, a specific legal right they are seeking to enforce and protect, or a specific legal wrong they
are seeking to prevent and redress (Sec. 1, Rule 2, RRC). Furthermore, the Court notes that the Complaint is replete
with vague assumptions and vague conclusions based on unverified data. In fine, plaintiffs fail to state a cause of
action in its Complaint against the herein defendant.
Furthermore, the Court firmly believes that the matter before it, being impressed with political color and involving a
matter of public policy, may not be taken cognizance of by this Court without doing violence to the sacred principle
of "Separation of Powers" of the three (3) co-equal branches of the Government.
The Court is likewise of the impression that it cannot, no matter how we stretch our jurisdiction, grant the reliefs
prayed for by the plaintiffs, i.e., to cancel all existing timber license agreements in the country and to cease and
desist from receiving, accepting, processing, renewing or approving new timber license agreements. For to do
otherwise would amount to "impairment of contracts" abhored (sic) by the fundamental law. 11
We do not agree with the trial court's conclusions that the plaintiffs failed to allege with sufficient definiteness a specific legal right
involved or a specific legal wrong committed, and that the complaint is replete with vague assumptions and conclusions based on
unverified data. A reading of the complaint itself belies these conclusions.
The complaint focuses on one specific fundamental legal right — the right to a balanced and healthful ecology which, for the first time in
our nation's constitutional history, is solemnly incorporated in the fundamental law. Section 16, Article II of the 1987 Constitution
explicitly provides:
Sec. 16. The State shall protect and advance the right of the people to a balanced and healthful ecology in accord
with the rhythm and harmony of nature.
This right unites with the right to health which is provided for in the preceding section of the same article:
Sec. 15. The State shall protect and promote the right to health of the people and instill health consciousness
among them.
While the right to a balanced and healthful ecology is to be found under the Declaration of Principles and State Policies and not under the
Bill of Rights, it does not follow that it is less important than any of the civil and political rights enumerated in the latter. Such a right
belongs to a different category of rights altogether for it concerns nothing less than self-preservation and self-perpetuation — aptly and
fittingly stressed by the petitioners — the advancement of which may even be said to predate all governments and constitutions. As a
matter of fact, these basic rights need not even be written in the Constitution for they are assumed to exist from the inception of
humankind. If they are now explicitly mentioned in the fundamental charter, it is because of the well-founded fear of its framers that
unless the rights to a balanced and healthful ecology and to health are mandated as state policies by the Constitution itself, thereby
highlighting their continuing importance and imposing upon the state a solemn obligation to preserve the first and protect and advance
the second, the day would not be too far when all else would be lost not only for the present generation, but also for those to come —
generations which stand to inherit nothing but parched earth incapable of sustaining life.
The right to a balanced and healthful ecology carries with it the correlative duty to refrain from impairing the environment. During the
debates on this right in one of the plenary sessions of the 1986 Constitutional Commission, the following exchange transpired between
Commissioner Wilfrido Villacorta and Commissioner Adolfo Azcuna who sponsored the section in question:
MR. VILLACORTA:
Does this section mandate the State to provide sanctions against all forms of pollution — air,
water and noise pollution?
MR. AZCUNA:
Yes, Madam President. The right to healthful (sic) environment necessarily carries with it the
correlative duty of not impairing the same and, therefore, sanctions may be provided for
impairment of environmental balance. 12
The said right implies, among many other things, the judicious management and conservation of the country's forests.
Without such forests, the ecological or environmental balance would be irreversiby disrupted.
Conformably with the enunciated right to a balanced and healthful ecology and the right to health, as well as the other related provisions
of the Constitution concerning the conservation, development and utilization of the country's natural resources, 13 then President Corazon
C. Aquino promulgated on 10 June 1987 E.O. No. 192, 14 Section 4 of which expressly mandates that the Department of Environment and
Natural Resources "shall be the primary government agency responsible for the conservation, management, development and proper use
of the country's environment and natural resources, specifically forest and grazing lands, mineral, resources, including those in
reservation and watershed areas, and lands of the public domain, as well as the licensing and regulation of all natural resources as may be
provided for by law in order to ensure equitable sharing of the benefits derived therefrom for the welfare of the present and future
generations of Filipinos." Section 3 thereof makes the following statement of policy:
Sec. 3. Declaration of Policy. — It is hereby declared the policy of the State to ensure the sustainable use,
development, management, renewal, and conservation of the country's forest, mineral, land, off-shore areas and
other natural resources, including the protection and enhancement of the quality of the environment, and
equitable access of the different segments of the population to the development and the use of the country's
natural resources, not only for the present generation but for future generations as well. It is also the policy of the
state to recognize and apply a true value system including social and environmental cost implications relative to
their utilization, development and conservation of our natural resources.
This policy declaration is substantially re-stated it Title XIV, Book IV of the Administrative Code of 1987,15 specifically in Section 1 thereof
which reads:
Sec. 1. Declaration of Policy. — (1) The State shall ensure, for the benefit of the Filipino people, the full exploration
and development as well as the judicious disposition, utilization, management, renewal and conservation of the
country's forest, mineral, land, waters, fisheries, wildlife, off-shore areas and other natural resources, consistent
with the necessity of maintaining a sound ecological balance and protecting and enhancing the quality of the
environment and the objective of making the exploration, development and utilization of such natural resources
equitably accessible to the different segments of the present as well as future generations.
(2) The State shall likewise recognize and apply a true value system that takes into account social and
environmental cost implications relative to the utilization, development and conservation of our natural resources.
The above provision stresses "the necessity of maintaining a sound ecological balance and protecting and enhancing the quality of the
environment." Section 2 of the same Title, on the other hand, specifically speaks of the mandate of the DENR; however, it makes
particular reference to the fact of the agency's being subject to law and higher authority. Said section provides:
Sec. 2. Mandate. — (1) The Department of Environment and Natural Resources shall be primarily responsible for the
implementation of the foregoing policy.
(2) It shall, subject to law and higher authority, be in charge of carrying out the State's constitutional mandate to
control and supervise the exploration, development, utilization, and conservation of the country's natural
resources.
Both E.O. NO. 192 and the Administrative Code of 1987 have set the objectives which will serve as the bases for policy formulation, and
have defined the powers and functions of the DENR.
It may, however, be recalled that even before the ratification of the 1987 Constitution, specific statutes already paid special attention to
the "environmental right" of the present and future generations. On 6 June 1977, P.D. No. 1151 (Philippine Environmental Policy) and P.D.
No. 1152 (Philippine Environment Code) were issued. The former "declared a continuing policy of the State (a) to create, develop,
maintain and improve conditions under which man and nature can thrive in productive and enjoyable harmony with each other, (b) to
fulfill the social, economic and other requirements of present and future generations of Filipinos, and (c) to insure the attainment of an
environmental quality that is conducive to a life of dignity and well-being." 16 As its goal, it speaks of the "responsibilities of each
generation as trustee and guardian of the environment for succeeding generations." 17 The latter statute, on the other hand, gave flesh to
the said policy.
Thus, the right of the petitioners (and all those they represent) to a balanced and healthful ecology is as clear as the DENR's duty — under
its mandate and by virtue of its powers and functions under E.O. No. 192 and the Administrative Code of 1987 — to protect and advance
the said right.
A denial or violation of that right by the other who has the corelative duty or obligation to respect or protect the same gives rise to a
cause of action. Petitioners maintain that the granting of the TLAs, which they claim was done with grave abuse of discretion, violated
their right to a balanced and healthful ecology; hence, the full protection thereof requires that no further TLAs should be renewed or
granted.
A cause of action is defined as:
. . . an act or omission of one party in violation of the legal right or rights of the other; and its essential elements are
legal right of the plaintiff, correlative obligation of the defendant, and act or omission of the defendant in violation
of said legal right. 18
It is settled in this jurisdiction that in a motion to dismiss based on the ground that the complaint fails to state a cause of action, 19 the
question submitted to the court for resolution involves the sufficiency of the facts alleged in the complaint itself. No other matter should
be considered; furthermore, the truth of falsity of the said allegations is beside the point for the truth thereof is deemed hypothetically
admitted. The only issue to be resolved in such a case is: admitting such alleged facts to be true, may the court render a valid judgment in
accordance with the prayer in the complaint? 20 In Militante vs. Edrosolano, 21 this Court laid down the rule that the judiciary should
"exercise the utmost care and circumspection in passing upon a motion to dismiss on the ground of the absence thereof [cause of action]
lest, by its failure to manifest a correct appreciation of the facts alleged and deemed hypothetically admitted, what the law grants or
recognizes is effectively nullified. If that happens, there is a blot on the legal order. The law itself stands in disrepute."
After careful examination of the petitioners' complaint, We find the statements under the introductory affirmative allegations, as well as
the specific averments under the sub-heading CAUSE OF ACTION, to be adequate enough to show, prima facie, the claimed violation of
their rights. On the basis thereof, they may thus be granted, wholly or partly, the reliefs prayed for. It bears stressing, however, that
insofar as the cancellation of the TLAs is concerned, there is the need to implead, as party defendants, the grantees thereof for they are
indispensable parties.
The foregoing considered, Civil Case No. 90-777 be said to raise a political question. Policy formulation or determination by the executive
or legislative branches of Government is not squarely put in issue. What is principally involved is the enforcement of a right vis-a-
vis policies already formulated and expressed in legislation. It must, nonetheless, be emphasized that the political question doctrine is no
longer, the insurmountable obstacle to the exercise of judicial power or the impenetrable shield that protects executive and legislative
actions from judicial inquiry or review. The second paragraph of section 1, Article VIII of the Constitution states that:
Judicial power includes the duty of the courts of justice to settle actual controversies involving rights which are
legally demandable and enforceable, and to determine whether or not there has been a grave abuse of discretion
amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the Government.
Commenting on this provision in his book, Philippine Political Law, 22 Mr. Justice Isagani A. Cruz, a distinguished member of this Court,
says:
The first part of the authority represents the traditional concept of judicial power, involving the settlement of
conflicting rights as conferred as law. The second part of the authority represents a broadening of judicial power to
enable the courts of justice to review what was before forbidden territory, to wit, the discretion of the political
departments of the government.
As worded, the new provision vests in the judiciary, and particularly the Supreme Court, the power to rule upon
even the wisdom of the decisions of the executive and the legislature and to declare their acts invalid for lack or
excess of jurisdiction because tainted with grave abuse of discretion. The catch, of course, is the meaning of "grave
abuse of discretion," which is a very elastic phrase that can expand or contract according to the disposition of the
judiciary.
In Daza vs. Singson, 23 Mr. Justice Cruz, now speaking for this Court, noted:
In the case now before us, the jurisdictional objection becomes even less tenable and decisive. The reason is that,
even if we were to assume that the issue presented before us was political in nature, we would still not be
precluded from revolving it under the expanded jurisdiction conferred upon us that now covers, in proper cases,
even the political question. Article VII, Section 1, of the Constitution clearly provides: . . .
The last ground invoked by the trial court in dismissing the complaint is the non-impairment of contracts clause found in the Constitution.
The court a quo declared that:
The Court is likewise of the impression that it cannot, no matter how we stretch our jurisdiction, grant the reliefs
prayed for by the plaintiffs, i.e., to cancel all existing timber license agreements in the country and to cease and
desist from receiving, accepting, processing, renewing or approving new timber license agreements. For to do
otherwise would amount to "impairment of contracts" abhored (sic) by the fundamental law. 24
We are not persuaded at all; on the contrary, We are amazed, if not shocked, by such a sweeping pronouncement. In the first place, the
respondent Secretary did not, for obvious reasons, even invoke in his motion to dismiss the non-impairment clause. If he had done so, he
would have acted with utmost infidelity to the Government by providing undue and unwarranted benefits and advantages to the timber
license holders because he would have forever bound the Government to strictly respect the said licenses according to their terms and
conditions regardless of changes in policy and the demands of public interest and welfare. He was aware that as correctly pointed out by
the petitioners, into every timber license must be read Section 20 of the Forestry Reform Code (P.D. No. 705) which provides:
. . . Provided, That when the national interest so requires, the President may amend, modify, replace or rescind any
contract, concession, permit, licenses or any other form of privilege granted herein . . .
Needless to say, all licenses may thus be revoked or rescinded by executive action. It is not a contract, property or a property
right protested by the due process clause of the Constitution. In Tan vs. Director of Forestry, 25 this Court held:
. . . A timber license is an instrument by which the State regulates the utilization and disposition of forest resources
to the end that public welfare is promoted. A timber license is not a contract within the purview of the due process
clause; it is only a license or privilege, which can be validly withdrawn whenever dictated by public interest or public
welfare as in this case.
A license is merely a permit or privilege to do what otherwise would be unlawful, and is not a contract between the
authority, federal, state, or municipal, granting it and the person to whom it is granted; neither is it property or a
property right, nor does it create a vested right; nor is it taxation (37 C.J. 168). Thus, this Court held that the
granting of license does not create irrevocable rights, neither is it property or property rights (People vs. Ong Tin, 54
O.G. 7576).
We reiterated this pronouncement in Felipe Ysmael, Jr. & Co., Inc. vs. Deputy Executive Secretary: 26
. . . Timber licenses, permits and license agreements are the principal instruments by which the State regulates the
utilization and disposition of forest resources to the end that public welfare is promoted. And it can hardly be
gainsaid that they merely evidence a privilege granted by the State to qualified entities, and do not vest in the latter
a permanent or irrevocable right to the particular concession area and the forest products therein. They may be
validly amended, modified, replaced or rescinded by the Chief Executive when national interests so require. Thus,
they are not deemed contracts within the purview of the due process of law clause [See Sections 3(ee) and 20 of
Pres. Decree No. 705, as amended. Also, Tan v. Director of Forestry, G.R. No. L-24548, October 27, 1983, 125 SCRA
302].
Since timber licenses are not contracts, the non-impairment clause, which reads:
Sec. 10. No law impairing, the obligation of contracts shall be passed. 27
cannot be invoked.
In the second place, even if it is to be assumed that the same are contracts, the instant case does not involve a law or even an executive
issuance declaring the cancellation or modification of existing timber licenses. Hence, the non-impairment clause cannot as yet be
invoked. Nevertheless, granting further that a law has actually been passed mandating cancellations or modifications, the same cannot
still be stigmatized as a violation of the non-impairment clause. This is because by its very nature and purpose, such as law could have
only been passed in the exercise of the police power of the state for the purpose of advancing the right of the people to a balanced and
healthful ecology, promoting their health and enhancing the general welfare. In Abe vs. Foster Wheeler
Corp. 28 this Court stated:
The freedom of contract, under our system of government, is not meant to be absolute. The same is understood to
be subject to reasonable legislative regulation aimed at the promotion of public health, moral, safety and welfare.
In other words, the constitutional guaranty of non-impairment of obligations of contract is limited by the exercise of
the police power of the State, in the interest of public health, safety, moral and general welfare.
The reason for this is emphatically set forth in Nebia vs. New York, 29 quoted in Philippine American Life Insurance Co. vs. Auditor
General,30 to wit:
Under our form of government the use of property and the making of contracts are normally matters of private and
not of public concern. The general rule is that both shall be free of governmental interference. But neither property
rights nor contract rights are absolute; for government cannot exist if the citizen may at will use his property to the
detriment of his fellows, or exercise his freedom of contract to work them harm. Equally fundamental with the
private right is that of the public to regulate it in the common interest.
In short, the non-impairment clause must yield to the police power of the state. 31
Finally, it is difficult to imagine, as the trial court did, how the non-impairment clause could apply with respect to the prayer to enjoin the
respondent Secretary from receiving, accepting, processing, renewing or approving new timber licenses for, save in cases of renewal, no
contract would have as of yet existed in the other instances. Moreover, with respect to renewal, the holder is not entitled to it as a matter
of right.
WHEREFORE, being impressed with merit, the instant Petition is hereby GRANTED, and the challenged Order of respondent Judge of 18
July 1991 dismissing Civil Case No. 90-777 is hereby set aside. The petitioners may therefore amend their complaint to implead as
defendants the holders or grantees of the questioned timber license agreements.
No pronouncement as to costs.
SO ORDERED.
Cruz, Padilla, Bidin, Griño-Aquino, Regalado, Romero, Nocon, Bellosillo, Melo and Quiason, JJ., concur.
Narvasa, C.J., Puno and Vitug, JJ., took no part.
Separate Opinions
FELICIANO, J., concurring
I join in the result reached by my distinguished brother in the Court, Davide, Jr., J., in this case which, to my mind, is one of the most
important cases decided by this Court in the last few years. The seminal principles laid down in this decision are likely to influence
profoundly the direction and course of the protection and management of the environment, which of course embraces the utilization
of all the natural resources in the territorial base of our polity. I have therefore sought to clarify, basically to myself, what the Court
appears to be saying.
The Court explicitly states that petitioners have the locus standi necessary to sustain the bringing and, maintenance of this suit (Decision,
pp. 11-12). Locus standi is not a function of petitioners' claim that their suit is properly regarded as a class suit. I understand locus
standi to refer to the legal interest which a plaintiff must have in the subject matter of the suit. Because of the very broadness of the
concept of "class" here involved — membership in this "class" appears to embrace everyone living in the country whether now or in the
future — it appears to me that everyone who may be expected to benefit from the course of action petitioners seek to require public
respondents to take, is vested with the necessary locus standi. The Court may be seen therefore to be recognizing a beneficiaries' right of
action in the field of environmental protection, as against both the public administrative agency directly concerned and the private
persons or entities operating in the field or sector of activity involved. Whether such beneficiaries' right of action may be found under any
and all circumstances, or whether some failure to act, in the first instance, on the part of the governmental agency concerned must be
shown ("prior exhaustion of administrative remedies"), is not discussed in the decision and presumably is left for future determination in
an appropriate case.
The Court has also declared that the complaint has alleged and focused upon "one specific fundamental legal right — the right to a
balanced and healthful ecology" (Decision, p. 14). There is no question that "the right to a balanced and healthful ecology" is
"fundamental" and that, accordingly, it has been "constitutionalized." But although it is fundamental in character, I suggest, with very
great respect, that it cannot be characterized as "specific," without doing excessive violence to language. It is in fact very difficult to
fashion language more comprehensive in scope and generalized in character than a right to "a balanced and healthful ecology." The list of
particular claims which can be subsumed under this rubic appears to be entirely open-ended: prevention and control of emission of toxic
fumes and smoke from factories and motor vehicles; of discharge of oil, chemical effluents, garbage and raw sewage into rivers, inland
and coastal waters by vessels, oil rigs, factories, mines and whole communities; of dumping of organic and inorganic wastes on open land,
streets and thoroughfares; failure to rehabilitate land after strip-mining or open-pit mining; kaingin or slash-and-burn farming;
destruction of fisheries, coral reefs and other living sea resources through the use of dynamite or cyanide and other chemicals;
contamination of ground water resources; loss of certain species of fauna and flora; and so on. The other statements pointed out by the
Court: Section 3, Executive Order No. 192 dated 10 June 1987; Section 1, Title XIV, Book IV of the 1987 Administrative Code; and P.D. No.
1151, dated 6 June 1977 — all appear to be formulations of policy, as general and abstract as the constitutional statements of basic policy
in Article II, Section 16 ("the right — to a balanced and healthful ecology") and 15 ("the right to health").
P.D. No. 1152, also dated 6 June 1977, entitled "The Philippine Environment Code," is, upon the other hand, a compendious collection of
more "specific environment management policies" and "environment quality standards" (fourth "Whereas" clause, Preamble) relating to
an extremely wide range of topics:
(a) air quality management;
(b) water quality management;
(c) land use management;
(d) natural resources management and conservation embracing:
(i) fisheries and aquatic resources;
(ii) wild life;
(iii) forestry and soil conservation;
(iv) flood control and natural calamities;
(v) energy development;
(vi) conservation and utilization of surface and ground water
(vii) mineral resources
Two (2) points are worth making in this connection. Firstly, neither petitioners nor the Court has identified the particular provision or
provisions (if any) of the Philippine Environment Code which give rise to a specific legal right which petitioners are seeking to enforce.
Secondly, the Philippine Environment Code identifies with notable care the particular government agency charged with the formulation
and implementation of guidelines and programs dealing with each of the headings and sub-headings mentioned above. The Philippine
Environment Code does not, in other words, appear to contemplate action on the part of private persons who are beneficiaries of
implementation of that Code.
As a matter of logic, by finding petitioners' cause of action as anchored on a legal right comprised in the constitutional statements above
noted, the Court is in effect saying that Section 15 (and Section 16) of Article II of the Constitution are self-executing and judicially
enforceable even in their present form. The implications of this doctrine will have to be explored in future cases; those implications are
too large and far-reaching in nature even to be hinted at here.
My suggestion is simply that petitioners must, before the trial court, show a more specific legal right — a right cast in language of a
significantly lower order of generality than Article II (15) of the Constitution — that is or may be violated by the actions, or failures to act,
imputed to the public respondent by petitioners so that the trial court can validly render judgment granting all or part of the relief prayed
for. To my mind, the Court should be understood as simply saying that such a more specific legal right or rights may well exist in
our corpus of law, considering the general policy principles found in the Constitution and the existence of the Philippine Environment
Code, and that the trial court should have given petitioners an effective opportunity so to demonstrate, instead of aborting the
proceedings on a motion to dismiss.
It seems to me important that the legal right which is an essential component of a cause of action be a specific, operable legal right, rather
than a constitutional or statutory policy, for at least two (2) reasons. One is that unless the legal right claimed to have been violated or
disregarded is given specification in operational terms, defendants may well be unable to defend themselves intelligently and effectively;
in other words, there are due process dimensions to this matter.
The second is a broader-gauge consideration — where a specific violation of law or applicable regulation is not alleged or proved,
petitioners can be expected to fall back on the expanded conception of judicial power in the second paragraph of Section 1 of Article VIII
of the Constitution which reads:
Section 1. . . .
Judicial power includes the duty of the courts of justice to settle actual controversies involving rights which are
legally demandable and enforceable, and to determine whether or not there has been a grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the
Government. (Emphasis supplied)
When substantive standards as general as "the right to a balanced and healthy ecology" and "the right to health" are combined
with remedial standards as broad ranging as "a grave abuse of discretion amounting to lack or excess of jurisdiction," the result
will be, it is respectfully submitted, to propel courts into the uncharted ocean of social and economic policy making. At least in
respect of the vast area of environmental protection and management, our courts have no claim to special technical
competence and experience and professional qualification. Where no specific, operable norms and standards are shown to
exist, then the policy making departments — the legislative and executive departments — must be given a real and effective
opportunity to fashion and promulgate those norms and standards, and to implement them before the courts should
intervene.
My learned brother Davide, Jr., J., rightly insists that the timber companies, whose concession agreements or TLA's petitioners demand
public respondents should cancel, must be impleaded in the proceedings below. It might be asked that, if petitioners' entitlement to the
relief demanded is not dependent upon proof of breach by the timber companies of one or more of the specific terms and conditions of
their concession agreements (and this, petitioners implicitly assume), what will those companies litigate about? The answer I suggest is
that they may seek to dispute the existence of the specific legal right petitioners should allege, as well as the reality of the claimed factual
nexus between petitioners' specific legal rights and the claimed wrongful acts or failures to act of public respondent administrative
agency. They may also controvert the appropriateness of the remedy or remedies demanded by petitioners, under all the circumstances
which exist.
I vote to grant the Petition for Certiorari because the protection of the environment, including the forest cover of our territory, is of
extreme importance for the country. The doctrines set out in the Court's decision issued today should, however, be subjected to closer
examination.
# Separate Opinions
FELICIANO, J., concurring
I join in the result reached by my distinguished brother in the Court, Davide, Jr., J., in this case which, to my mind, is one of the most
important cases decided by this Court in the last few years. The seminal principles laid down in this decision are likely to influence
profoundly the direction and course of the protection and management of the environment, which of course embraces the utilization
of all the natural resources in the territorial base of our polity. I have therefore sought to clarify, basically to myself, what the Court
appears to be saying.
The Court explicitly states that petitioners have the locus standi necessary to sustain the bringing and, maintenance of this suit (Decision,
pp. 11-12). Locus standi is not a function of petitioners' claim that their suit is properly regarded as a class suit. I understand locus
standi to refer to the legal interest which a plaintiff must have in the subject matter of the suit. Because of the very broadness of the
concept of "class" here involved — membership in this "class" appears to embrace everyone living in the country whether now or in the
future — it appears to me that everyone who may be expected to benefit from the course of action petitioners seek to require public
respondents to take, is vested with the necessary locus standi. The Court may be seen therefore to be recognizing a beneficiaries' right of
action in the field of environmental protection, as against both the public administrative agency directly concerned and the private
persons or entities operating in the field or sector of activity involved. Whether such beneficiaries' right of action may be found under any
and all circumstances, or whether some failure to act, in the first instance, on the part of the governmental agency concerned must be
shown ("prior exhaustion of administrative remedies"), is not discussed in the decision and presumably is left for future determination in
an appropriate case.
The Court has also declared that the complaint has alleged and focused upon "one specific fundamental legal right — the right to a
balanced and healthful ecology" (Decision, p. 14). There is no question that "the right to a balanced and healthful ecology" is
"fundamental" and that, accordingly, it has been "constitutionalized." But although it is fundamental in character, I suggest, with very
great respect, that it cannot be characterized as "specific," without doing excessive violence to language. It is in fact very difficult to
fashion language more comprehensive in scope and generalized in character than a right to "a balanced and healthful ecology." The list of
particular claims which can be subsumed under this rubic appears to be entirely open-ended: prevention and control of emission of toxic
fumes and smoke from factories and motor vehicles; of discharge of oil, chemical effluents, garbage and raw sewage into rivers, inland
and coastal waters by vessels, oil rigs, factories, mines and whole communities; of dumping of organic and inorganic wastes on open land,
streets and thoroughfares; failure to rehabilitate land after strip-mining or open-pit mining; kaingin or slash-and-burn farming;
destruction of fisheries, coral reefs and other living sea resources through the use of dynamite or cyanide and other chemicals;
contamination of ground water resources; loss of certain species of fauna and flora; and so on. The other statements pointed out by the
Court: Section 3, Executive Order No. 192 dated 10 June 1987; Section 1, Title XIV, Book IV of the 1987 Administrative Code; and P.D. No.
1151, dated 6 June 1977 — all appear to be formulations of policy, as general and abstract as the constitutional statements of basic policy
in Article II, Section 16 ("the right — to a balanced and healthful ecology") and 15 ("the right to health").
P.D. No. 1152, also dated 6 June 1977, entitled "The Philippine Environment Code," is, upon the other hand, a compendious collection of
more "specific environment management policies" and "environment quality standards" (fourth "Whereas" clause, Preamble) relating to
an extremely wide range of topics:
(a) air quality management;
(b) water quality management;
 (c) land use management;
(d) natural resources management and conservation embracing:
(i) fisheries and aquatic resources;
(ii) wild life;
(iii) forestry and soil conservation;
(iv) flood control and natural calamities;
(v) energy development;
(vi) conservation and utilization of surface and ground water
(vii) mineral resources
Two (2) points are worth making in this connection. Firstly, neither petitioners nor the Court has identified the particular provision or
provisions (if any) of the Philippine Environment Code which give rise to a specific legal right which petitioners are seeking to enforce.
Secondly, the Philippine Environment Code identifies with notable care the particular government agency charged with the formulation
and implementation of guidelines and programs dealing with each of the headings and sub-headings mentioned above. The Philippine
Environment Code does not, in other words, appear to contemplate action on the part of private persons who are beneficiaries of
implementation of that Code.
As a matter of logic, by finding petitioners' cause of action as anchored on a legal right comprised in the constitutional statements above
noted, the Court is in effect saying that Section 15 (and Section 16) of Article II of the Constitution are self-executing and judicially
enforceable even in their present form. The implications of this doctrine will have to be explored in future cases; those implications are
too large and far-reaching in nature even to be hinted at here.
My suggestion is simply that petitioners must, before the trial court, show a more specific legal right — a right cast in language of a
significantly lower order of generality than Article II (15) of the Constitution — that is or may be violated by the actions, or failures to act,
imputed to the public respondent by petitioners so that the trial court can validly render judgment granting all or part of the relief prayed
for. To my mind, the Court should be understood as simply saying that such a more specific legal right or rights may well exist in
our corpus of law, considering the general policy principles found in the Constitution and the existence of the Philippine Environment
Code, and that the trial court should have given petitioners an effective opportunity so to demonstrate, instead of aborting the
proceedings on a motion to dismiss.
It seems to me important that the legal right which is an essential component of a cause of action be a specific, operable legal right, rather
than a constitutional or statutory policy, for at least two (2) reasons. One is that unless the legal right claimed to have been violated or
disregarded is given specification in operational terms, defendants may well be unable to defend themselves intelligently and effectively;
in other words, there are due process dimensions to this matter.
The second is a broader-gauge consideration — where a specific violation of law or applicable regulation is not alleged or proved,
petitioners can be expected to fall back on the expanded conception of judicial power in the second paragraph of Section 1 of Article VIII
of the Constitution which reads:
Section 1. . . .
Judicial power includes the duty of the courts of justice to settle actual controversies involving rights which are
legally demandable and enforceable, and to determine whether or not there has been a grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the
Government. (Emphasis supplied)
When substantive standards as general as "the right to a balanced and healthy ecology" and "the right to health" are combined
with remedial standards as broad ranging as "a grave abuse of discretion amounting to lack or excess of jurisdiction," the result
will be, it is respectfully submitted, to propel courts into the uncharted ocean of social and economic policy making. At least in
respect of the vast area of environmental protection and management, our courts have no claim to special technical
competence and experience and professional qualification. Where no specific, operable norms and standards are shown to
exist, then the policy making departments — the legislative and executive departments — must be given a real and effective
opportunity to fashion and promulgate those norms and standards, and to implement them before the courts should
intervene.
My learned brother Davide, Jr., J., rightly insists that the timber companies, whose concession agreements or TLA's petitioners demand
public respondents should cancel, must be impleaded in the proceedings below. It might be asked that, if petitioners' entitlement to the
relief demanded is not dependent upon proof of breach by the timber companies of one or more of the specific terms and conditions of
their concession agreements (and this, petitioners implicitly assume), what will those companies litigate about? The answer I suggest is
that they may seek to dispute the existence of the specific legal right petitioners should allege, as well as the reality of the claimed factual
nexus between petitioners' specific legal rights and the claimed wrongful acts or failures to act of public respondent administrative
agency. They may also controvert the appropriateness of the remedy or remedies demanded by petitioners, under all the circumstances
which exist.
I vote to grant the Petition for Certiorari because the protection of the environment, including the forest cover of our territory, is of
extreme importance for the country. The doctrines set out in the Court's decision issued today should, however, be subjected to closer
examination.
# Footnotes
HEIRS OF BERTULDO[1] HINOG: Bertuldo Hinog II, Bertuldo Hinog III, Bertuldo Hinog, Jr., Jocelyn Hinog, Bertoldo Hinog IV, Bertoldo
Hinog V, Edgardo Hinog, Milagros H. Pabatao, Lilian H. King, Victoria H. Engracia, Terisita C. Hinog, Paz H. Besana, Roberto C.
Hinog, Vicente C. Hinog, Roel C. Hinog, Marilyn C. Hinog, Bebot C. Hinog, lordes C. Hinog, Pablo Chiong, Arlene Lanasang (All
respresented by Bertuldo Hinog III), petitioners, vs. HON. ACHILLES MELICOR, in his capacity as Presiding Judge, RTC, Branch
4, 7th Judicial Region, Tagbiliran City, Bohol, and CUSTODIO BALANE, RUFO BALANE, HONORIO BALANE, and TOMAS
BALANE, respondents.
DECISION
AUSTRIA-MARTINEZ, J.:
Before us is a petition for certiorari and prohibition under Rule 65 of the Rules of Court which assails the Orders dated March 22,
1999, August 13, 1999 and October 15, 1999 of the Regional Trial Court, Branch 4, of Tagbilaran City, Bohol in Civil Case No. 4923.
The factual background of the case is as follows:
On May 21, 1991, private respondents Custodio, Rufo, Tomas and Honorio, all surnamed Balane, filed a complaint for Recovery of
Ownership and Possession, Removal of Construction and Damages against Bertuldo Hinog (Bertuldo for brevity). They alleged that: they
own a 1,399- square meter parcel of land situated in Malayo Norte, Cortes, Bohol, designated as Lot No. 1714; sometime in March 1980,
they allowed Bertuldo to use a portion of the said property for a period of ten years and construct thereon a small house of light materials
at a nominal annual rental of P100.00 only, considering the close relations of the parties; after the expiration of the ten-year period, they
demanded the return of the occupied portion and removal of the house constructed thereon but Bertuldo refused and instead claimed
ownership of the entire property.
Accordingly, private respondents sought to oust Bertuldo from the premises of the subject property and restore upon themselves
the ownership and possession thereof, as well as the payment of moral and exemplary damages, attorneys fees and litigation expenses in
amounts justified by the evidence. [2]
On July 2, 1991, Bertuldo filed his Answer. He alleged ownership of the disputed property by virtue of a Deed of Absolute Sale
dated July 2, 1980, executed by one Tomas Pahac with the knowledge and conformity of private respondents.[3]
After the pre-trial, trial on the merits ensued. On November 18, 1997, private respondents rested their case. Thereupon, Bertuldo
started his direct examination. However, on June 24, 1998, Bertuldo died without completing his evidence.
On August 4, 1998, Atty. Sulpicio A. Tinampay withdrew as counsel for Bertuldo as his services were terminated by petitioner
Bertuldo Hinog III. Atty. Veronico G. Petalcorin then entered his appearance as new counsel for Bertuldo.[4]
On September 22, 1998, Atty. Petalcorin filed a motion to expunge the complaint from the record and nullify all court proceedings
on the ground that private respondents failed to specify in the complaint the amount of damages claimed so as to pay the correct docket
fees; and that under Manchester Development Corporation vs. Court of Appeals,[5] non-payment of the correct docket fee is
jurisdictional.[6]
In an amended motion, filed on October 2, 1998, Atty. Petalcorin further alleged that the private respondents failed to pay the
correct docket fee since the main subject matter of the case cannot be estimated as it is for recovery of ownership, possession and
removal of construction.[7]
Private respondents opposed the motion to expunge on the following grounds: (a) said motion was filed more than seven years
from the institution of the case; (b) Atty. Petalcorin has not complied with Section 16, Rule 3 of the Rules of Court which provides that the
death of the original defendant requires a substitution of parties before a lawyer can have legal personality to represent a litigant and the
motion to expunge does not mention of any specific party whom he is representing; (c) collectible fees due the court can be charged as
lien on the judgment; and (d) considering the lapse of time, the motion is merely a dilatory scheme employed by petitioners.[8]
In their Rejoinder, petitioners manifested that the lapse of time does not vest the court with jurisdiction over the case due to
failure to pay the correct docket fees. As to the contention that deficiency in payment of docket fees can be made as a lien on the
judgment, petitioners argued that the payment of filing fees cannot be made dependent on the result of the action taken.[9]
On January 21, 1999, the trial court, while ordering the complaint to be expunged from the records and the nullification of all court
proceedings taken for failure to pay the correct docket fees, nonetheless, held:
The Court can acquire jurisdiction over this case only upon the payment of the exact prescribed docket/filing fees for the main cause of
action, plus additional docket fee for the amount of damages being prayed for in the complaint, which amount should be specified so that
the same can be considered in assessing the amount of the filing fees. Upon the complete payment of such fees, the Court may take
appropriate action in the light of the ruling in the case of Manchester Development Corporation vs. Court of Appeals, supra.[10]
Accordingly, on January 28, 1999, upon payment of deficiency docket fee, private respondents filed a manifestation with prayer to
reinstate the case.[11] Petitioners opposed the reinstatement[12] but on March 22, 1999, the trial court issued the first assailed Order
reinstating the case.[13]
 On May 24, 1999, petitioners, upon prior leave of court,[14] filed their supplemental pleading, appending therein a Deed of Sale
dated November 15, 1982.[15] Following the submission of private respondents opposition thereto,[16] the trial court, in its Order dated July
7, 1999, denied the supplemental pleading on the ground that the Deed of Absolute Sale is a new matter which was never mentioned in
the original answer dated July 2, 1991, prepared by Bertuldos original counsel and which Bertuldo verified; and that such new document is
deemed waived in the light of Section 1, Rule 9[17] of the Rules of Court. The trial court also noted that no formal substitution of the
parties was made because of the failure of defendants counsel to give the names and addresses of the legal representatives of Bertuldo,
so much so that the supposed heirs of Bertuldo are not specified in any pleading in the case. [18]
On July 14, 1999, petitioners manifested that the trial court having expunged the complaint and nullified all court proceedings,
there is no valid case and the complaint should not be admitted for failure to pay the correct docket fees; that there should be no case to
be reinstated and no case to proceed as there is no complaint filed.[19]
After the submission of private respondents opposition[20] and petitioners rejoinder,[21] the trial court issued the second assailed
Order on August 13, 1999, essentially denying petitioners manifestation/rejoinder. The trial court held that the issues raised in such
manifestation/rejoinder are practically the same as those raised in the amended motion to expunge which had already been passed upon
in the Order dated January 21, 1999. Moreover, the trial court observed that the Order dated March 22, 1999 which reinstated the case
was not objected to by petitioners within the reglementary period or even thereafter via a motion for reconsideration despite receipt
thereof on March 26, 1999.[22]
On August 25, 1999, petitioners filed a motion for reconsideration[23] but the same was denied by the trial court in its third assailed
Order dated October 15, 1999. The trial court held that the Manchester rule was relaxed in Sun Insurance Office, Ltd. vs.
Asuncion.[24] Noting that there has been no substitution of parties following the death of Bertuldo, the trial court directed Atty. Petalcorin
to comply with the provisions of Section 16, Rule 3 of the Rules of Court. The trial court also reiterated that the Order dated March 22,
1999 reinstating the case was not assailed by petitioners within the reglementary period, despite receipt thereof on March 26, 1999.[25]
On November 19, 1999, Atty. Petalcorin complied with the directive of the trial court to submit the names and addresses of the
heirs of Bertuldo.[26]
On November 24, 1999, petitioners filed before us the present petition for certiorari and prohibition.[27] They allege that the public
respondent committed grave abuse of discretion in allowing the case to be reinstated after private respondents paid the docket fee
deficiency since the trial court had earlier expunged the complaint from the record and nullified all proceedings of the case and such
ruling was not contested by the private respondents. Moreover, they argue that the public respondent committed grave abuse of
discretion in allowing the case to be filed and denying the manifestation with motion to dismiss, despite the defect in the complaint which
prayed for damages without specifying the amounts, in violation of SC Circular No. 7, dated March 24, 1988.
In their Comment, private respondents aver that no grave abuse of discretion was committed by the trial court in reinstating the
complaint upon the payment of deficiency docket fees because petitioners did not object thereto within the reglementary period.
Besides, Atty. Petalcorin possessed no legal personality to appear as counsel for the heirs of Bertuldo until he complies with Section 16,
Rule 3 of the Rules of Court.[28]
At the outset, we note the procedural error committed by petitioners in directly filing the instant petition before this Court for it
violates the established policy of strict observance of the judicial hierarchy of courts.
Although the Supreme Court, Court of Appeals and the Regional Trial Courts have concurrent jurisdiction to issue writs of certiorari,
prohibition, mandamus, quo warranto, habeas corpus and injunction, such concurrence does not give the petitioner unrestricted freedom
of choice of court forum.[29] As we stated in People vs. Cuaresma:[30]
This Court's original jurisdiction to issue writs of certiorari is not exclusive. It is shared by this Court with Regional Trial Courts and with
the Court of Appeals. This concurrence of jurisdiction is not, however, to be taken as according to parties seeking any of the writs an
absolute, unrestrained freedom of choice of the court to which application therefor will be directed. There is after all a hierarchy of
courts. That hierarchy is determinative of the venue of appeals, and also serves as a general determinant of the appropriate forum for
petitions for the extraordinary writs. A becoming regard for that judicial hierarchy most certainly indicates that petitions for the issuance
of extraordinary writs against first level (inferior) courts should be filed with the Regional Trial Court, and those against the latter, with the
Court of Appeals. A direct invocation of the Supreme Courts original jurisdiction to issue these writs should be allowed only when there
are special and important reasons therefor, clearly and specifically set out in the petition. This is [an] established policy. It is a policy
necessary to prevent inordinate demands upon the Courts time and attention which are better devoted to those matters within its
exclusive jurisdiction, and to prevent further over-crowding of the Courts docket.[31]
The rationale for this rule is two-fold: (a) it would be an imposition upon the precious time of this Court; and (b) it would cause an
inevitable and resultant delay, intended or otherwise, in the adjudication of cases, which in some instances had to be remanded or
referred to the lower court as the proper forum under the rules of procedure, or as better equipped to resolve the issues because this
Court is not a trier of facts.[32]
Thus, this Court will not entertain direct resort to it unless the redress desired cannot be obtained in the appropriate courts, and
exceptional and compelling circumstances, such as cases of national interest and of serious implications, justify the availment of the
extraordinary remedy of writ of certiorari, calling for the exercise of its primary jurisdiction. Exceptional and compelling circumstances
were held present in the following cases: (a) Chavez vs. Romulo[33] on citizens right to bear arms; (b) Government of the United States of
America vs. Purganan[34] on bail in extradition proceedings; (c) Commission on Elections vs. Quijano-Padilla[35] on government contract
involving modernization and computerization of voters registration list; (d) Buklod ng Kawaning EIIB vs. Zamora[36] on status and existence
of a public office; and (e) Fortich vs. Corona[37] on the so-called Win-Win Resolution of the Office of the President which modified the
approval of the conversion to agro-industrial area.
In this case, no special and important reason or exceptional and compelling circumstance analogous to any of the above cases has
been adduced by the petitioners so as to justify direct recourse to this Court. The present petition should have been initially filed in the
Court of Appeals in strict observance of the doctrine on the hierarchy of courts. Failure to do so is sufficient cause for the dismissal of the
petition at bar.
In any event, even if the Court disregards such procedural flaw, the petitioners contentions on the substantive aspect of the case
fail to invite judgment in their favor.
The unavailability of the writ of certiorari and prohibition in this case is borne out of the fact that petitioners principally assail the
Order dated March 22, 1999 which they never sought reconsideration of, in due time, despite receipt thereof on March 26, 1999. Instead,
petitioners went through the motion of filing a supplemental pleading and only when the latter was denied, or after more than three
months have passed, did they raise the issue that the complaint should not have been reinstated in the first place because the trial court
had no jurisdiction to do so, having already ruled that the complaint shall be expunged.
After recognizing the jurisdiction of the trial court by seeking affirmative relief in their motion to serve supplemental pleading upon
private respondents, petitioners are effectively barred by estoppel from challenging the trial courts jurisdiction.[38] If a party invokes the
jurisdiction of a court, he cannot thereafter challenge the courts jurisdiction in the same case. [39] To rule otherwise would amount to
speculating on the fortune of litigation, which is against the policy of the Court.[40]
Nevertheless, there is a need to correct the erroneous impression of the trial court as well as the private respondents that
petitioners are barred from assailing the Order dated March 22, 1999 which reinstated the case because it was not objected to within the
reglementary period or even thereafter via a motion for reconsideration despite receipt thereof on March 26, 1999.
It must be clarified that the said order is but a resolution on an incidental matter which does not touch on the merits of the case or
put an end to the proceedings.[41] It is an interlocutory order since there leaves something else to be done by the trial court with respect
to the merits of the case.[42] As such, it is not subject to a reglementary period. Reglementary period refers to the period set by the rules
for appeal or further review of a final judgment or order, i.e., one that ends the litigation in the trial court.
Moreover, the remedy against an interlocutory order is generally not to resort forthwith to certiorari, but to continue with the case
in due course and, when an unfavorable verdict is handed down, to take an appeal in the manner authorized by law. [43] Only when the
court issued such order without or in excess of jurisdiction or with grave abuse of discretion and when the assailed interlocutory order is
patently erroneous and the remedy of appeal would not afford adequate and expeditious relief will certiorari be considered an
appropriate remedy to assail an interlocutory order.[44] Such special circumstances are absolutely wanting in the present case.
Time and again, the Court has held that the Manchester rule has been modified in Sun Insurance Office, Ltd. (SIOL) vs.
Asuncion[45] which defined the following guidelines involving the payment of docket fees:
1. It is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee,
that vests a trial court with jurisdiction over the subject-matter or nature of the action. Where the filing of the initiatory
pleading is not accompanied by payment of the docket fee, the court may allow payment of the fees within a reasonable
time but in no case beyond the applicable prescriptive or reglementary period.
2. The same rule applies to permissive counterclaims, third-party claims and similar pleadings, which shall not be considered
filed until and unless the filing fee prescribed therefor is paid. The court may also allow payment of said fee within a
reasonable time but also in no case beyond its applicable prescriptive or reglementary period.
3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and payment of the
prescribed filing fee but, subsequently, the judgment awards a claim not specified in the pleading, or if specified the
same has been left for determination by the court, the additional filing fee therefor shall constitute a lien on the
judgment. It shall be the responsibility of the Clerk of Court or his duly authorized deputy to enforce said lien and assess
and collect the additional fee.
Plainly, while the payment of the prescribed docket fee is a jurisdictional requirement, even its non-payment at the time of filing
does not automatically cause the dismissal of the case, as long as the fee is paid within the applicable prescriptive or reglementary period,
more so when the party involved demonstrates a willingness to abide by the rules prescribing such payment. [46] Thus, when insufficient
filing fees were initially paid by the plaintiffs and there was no intention to defraud the government, the Manchester rule does not
apply.[47]
Under the peculiar circumstances of this case, the reinstatement of the complaint was just and proper considering that the cause of
action of private respondents, being a real action, prescribes in thirty years,[48] and private respondents did not really intend to evade the
payment of the prescribed docket fee but simply contend that they could not be faulted for inadequate assessment because the clerk of
court made no notice of demand or reassessment.[49] They were in good faith and simply relied on the assessment of the clerk of court.
 Furthermore, the fact that private respondents prayed for payment of damages in amounts justified by the evidence does not call
for the dismissal of the complaint for violation of SC Circular No. 7, dated March 24, 1988 which required that all complaints must specify
the amount of damages sought not only in the body of the pleadings but also in the prayer in order to be accepted and admitted for
filing. Sun Insurance effectively modified SC Circular No. 7 by providing that filing fees for damages and awards that cannot be estimated
constitute liens on the awards finally granted by the trial court.[50]
Thus, while the docket fees were based only on the real property valuation, the trial court acquired jurisdiction over the action, and
judgment awards which were left for determination by the court or as may be proven during trial would still be subject to additional filing
fees which shall constitute a lien on the judgment. It would then be the responsibility of the Clerk of Court of the trial court or his duly
authorized deputy to enforce said lien and assess and collect the additional fees.[51]
It is worth noting that when Bertuldo filed his Answer on July 2, 1991, he did not raise the issue of lack of jurisdiction for non-
payment of correct docket fees. Instead, he based his defense on a claim of ownership and participated in the proceedings before the trial
court. It was only in September 22, 1998 or more than seven years after filing the answer, and under the auspices of a new counsel, that
the issue of jurisdiction was raised for the first time in the motion to expunge by Bertuldos heirs.
After Bertuldo vigorously participated in all stages of the case before the trial court and even invoked the trial courts authority in
order to ask for affirmative relief, petitioners, considering that they merely stepped into the shoes of their predecessor, are effectively
barred by estoppel from challenging the trial courts jurisdiction. Although the issue of jurisdiction may be raised at any stage of the
proceedings as the same is conferred by law, it is nonetheless settled that a party may be barred from raising it on ground of laches or
estoppel.[52]
Moreover, no formal substitution of the parties was effected within thirty days from date of death of Bertuldo, as required by
Section 16, Rule 3[53] of the Rules of Court. Needless to stress, the purpose behind the rule on substitution is the protection of the right of
every party to due process. It is to ensure that the deceased party would continue to be properly represented in the suit through the duly
appointed legal representative of his estate.[54] Non-compliance with the rule on substitution would render the proceedings and judgment
of the trial court infirm because the court acquires no jurisdiction over the persons of the legal representatives or of the heirs on whom
the trial and the judgment would be binding.[55] Thus, proper substitution of heirs must be effected for the trial court to acquire
jurisdiction over their persons and to obviate any future claim by any heir that he was not apprised of the litigation against Bertuldo or
that he did not authorize Atty. Petalcorin to represent him.
The list of names and addresses of the heirs was submitted sixteen months after the death of Bertuldo and only when the trial
court directed Atty. Petalcorin to comply with the provisions of Section 16, Rule 3 of the Rules of Court. Strictly speaking therefore, before
said compliance, Atty. Petalcorin had no standing in the court a quo when he filed his pleadings. Be that as it may, the matter has been
duly corrected by the Order of the trial court dated October 15, 1999.
To be sure, certiorari under Rule 65[56] is a remedy narrow in scope and inflexible in character. It is not a general utility tool in the
legal workshop.[57] It offers only a limited form of review. Its principal function is to keep an inferior tribunal within its jurisdiction.[58] It can
be invoked only for an error of jurisdiction, that is, one where the act complained of was issued by the court, officer or a quasi-judicial
body without or in excess of jurisdiction, or with grave abuse of discretion which is tantamount to lack or in excess of jurisdiction,[59] not to
be used for any other purpose,[60] such as to cure errors in proceedings or to correct erroneous conclusions of law or fact.[61] A contrary
rule would lead to confusion, and seriously hamper the administration of justice.
Petitioners utterly failed to show that the trial court gravely abused its discretion in issuing the assailed resolutions. On the
contrary, it acted prudently, in accordance with law and jurisprudence.
WHEREFORE, the instant petition for certiorari is DISMISSED for lack of merit.
No costs.
SO ORDERED.
Puno, (Chairman), Callejo, Sr., Tinga and Chico-Nazario, JJ., concur.
Spouses JULITA DE LA CRUZ and FELIPE DE LA CRUZ, petitioners, vs. PEDRO JOAQUIN, respondent.
DECISION
PANGANIBAN, J.:
The Rules require the legal representatives of a dead litigant to be substituted as parties to a litigation. This requirement is
necessitated by due process. Thus, when the rights of the legal representatives of a decedent are actually recognized and protected,
noncompliance or belated formal compliance with the Rules cannot affect the validity of the promulgated decision. After all, due process
had thereby been satisfied.
The Case
Before us is a Petition for Review[1] under Rule 45 of the Rules of Court, assailing the August 26, 2003 Decision [2] and the March 9,
2004 Resolution[3] of the Court of Appeals (CA) in CA-GR CV No. 34702. The challenged Decision disposed as follows:
WHEREFORE, the foregoing considered, the appeal is DISMISSED and the assailed decision accordingly AFFIRMED in toto. No costs.[4]
On the other hand, the trial courts affirmed Decision disposed as follows:
WHEREFORE, judgment is hereby rendered:
a) declaring the Deed of Absolute Sale (Exh. D) and Kasunduan (Exhibit B), to be a sale with right of repurchase;
b) ordering the plaintiff to pay the defendants the sum of P9,000.00 by way of repurchasing the land in question;
c) ordering the defendants to execute a deed of reconveyance of said land in favor of the plaintiff after the latter has
paid them the amount of P9,000.00 to repurchase the land in question;
d) ordering the defendants to yield possession of the subject land to the plaintiff after the latter has paid them the
amount of P9,000.00 to repurchase the property from them; and
e) ordering the defendants to pay the plaintiff the amount of P10,000.00 as actual and compensatory damages; the
amount of P5,000[.00] as exemplary damages; the amount of P5,000.00 as expenses of litigation and the
amount of P5,000.00 by way of attorneys fees.[5]
The Facts
The case originated from a Complaint for the recovery of possession and ownership, the cancellation of title, and damages, filed by
Pedro Joaquin against petitioners in the Regional Trial Court of Baloc, Sto. Domingo, Nueva Ecija.[6] Respondent alleged that he had
obtained a loan from them in the amount of P9,000 on June 29, 1974, payable after five (5) years; that is, on June 29, 1979. To secure the
payment of the obligation, he supposedly executed a Deed of Sale in favor of petitioners. The Deed was for a parcel of land in
Pinagpanaan, Talavera, Nueva Ecija, covered by TCT No. T-111802. The parties also executed another document entitled Kasunduan. [7]
Respondent claimed that the Kasunduan showed the Deed of Sale to be actually an equitable mortgage.[8] Spouses De la Cruz
contended that this document was merely an accommodation to allow the repurchase of the property until June 29, 1979, a right that he
failed to exercise.[9]
On April 23, 1990, the RTC issued a Decision in his favor. The trial court declared that the parties had entered into a sale with a right
of repurchase.[10] It further held that respondent had made a valid tender of payment on two separate occasions to exercise his right of
repurchase.[11] Accordingly, petitioners were required to reconvey the property upon his payment.[12]
Ruling of the Court of Appeals
Sustaining the trial court, the CA noted that petitioners had given respondent the right to repurchase the property within five (5)
years from the date of the sale or until June 29, 1979. Accordingly, the parties executed the Kasunduan to express the terms and
conditions of their actual agreement.[13] The appellate court also found no reason to overturn the finding that respondent had validly
exercised his right to repurchase the land.[14]
In the March 9, 2004 Resolution, the CA denied reconsideration and ordered a substitution by legal representatives, in view of
respondents death on December 24, 1988.[15]
Hence, this Petition.[16]
The Issues
Petitioners assign the following errors for our consideration:
I. Public Respondent Twelfth Division of the Honorable Court of Appeals seriously erred in dismissing the appeal and affirming in toto the
Decision of the trial court in Civil Case No. SD-838;
II. Public Respondent Twelfth Division of the Honorable Court of Appeals likewise erred in denying [petitioners] Motion for
Reconsideration given the facts and the law therein presented.[17]
Succinctly, the issues are whether the trial court lost jurisdiction over the case upon the death of Pedro Joaquin, and whether
respondent was guilty of forum shopping.[18]
The Courts Ruling
The Petition has no merit.
First Issue:
Jurisdiction
Petitioners assert that the RTCs Decision was invalid for lack of jurisdiction. [19] They claim that respondent died during the pendency
of the case. There being no substitution by the heirs, the trial court allegedly lacked jurisdiction over the litigation.[20]
Rule on Substitution
When a party to a pending action dies and the claim is not extinguished,[21] the Rules of Court require a substitution of the
deceased. The procedure is specifically governed by Section 16 of Rule 3, which reads thus:
Section 16. Death of a party; duty of counsel. Whenever a party to a pending action dies, and the claim is not thereby extinguished, it shall
be the duty of his counsel to inform the court within thirty (30) days after such death of the fact thereof, and to give the name and
address of his legal representative or representatives. Failure of counsel to comply with this duty shall be a ground for disciplinary action.
The heirs of the deceased may be allowed to be substituted for the deceased, without requiring the appointment of an executor or
administrator and the court may appoint a guardian ad litem for the minor heirs.
The court shall forthwith order said legal representative or representatives to appear and be substituted within a period of thirty (30) days
from notice.
If no legal representative is named by the counsel for the deceased party, or if the one so named shall fail to appear within the specified
period, the court may order the opposing party, within a specified time, to procure the appointment of an executor or administrator for
the estate of the deceased, and the latter shall immediately appear for and on behalf of the deceased. The court charges in procuring such Under res judicata, a final judgment or decree on the merits by a court of competent jurisdiction is conclusive of the rights of the
appointment, if defrayed by the opposing party, may be recovered as costs. parties or their privies, in all later suits and on all points and matters determined in the previous suit.[43] The term literally means a matter
The rule on the substitution of parties was crafted to protect every partys right to due process.[22] The estate of the deceased party adjudged, judicially acted upon, or settled by judgment.[44] The principle bars a subsequent suit involving the same parties, subject matter,
will continue to be properly represented in the suit through the duly appointed legal representative.[23] Moreover, no adjudication can be and cause of action. Public policy requires that controversies must be settled with finality at a given point in time.
made against the successor of the deceased if the fundamental right to a day in court is denied.[24] The elements of res judicata are as follows: (1) the former judgment or order must be final; (2) it must have been rendered on the
The Court has nullified not only trial proceedings conducted without the appearance of the legal representatives of the deceased, merits of the controversy; (3) the court that rendered it must have had jurisdiction over the subject matter and the parties; and (4) there
but also the resulting judgments.[25] In those instances, the courts acquired no jurisdiction over the persons of the legal representatives or must have been -- between the first and the second actions -- an identity of parties, subject matter and cause of action.[45]
the heirs upon whom no judgment was binding.[26] Failure to Support Allegation
This general rule notwithstanding, a formal substitution by heirs is not necessary when they themselves voluntarily appear, The onus of proving allegations rests upon the party raising them.[46] As to the matter of forum shopping and res judicata,
participate in the case, and present evidence in defense of the deceased.[27] These actions negate any claim that the right to due process petitioners have failed to provide this Court with relevant and clear specifications that would show the presence of an identity of parties,
was violated. subject matter, and cause of action between the present and the earlier suits. They have also failed to show whether the other case was
The Court is not unaware of Chittick v. Court of Appeals,[28] in which the failure of the heirs to substitute for the original plaintiff decided on the merits. Instead, they have made only bare assertions involving its existence without reference to its facts. In other words,
upon her death led to the nullification of the trial courts Decision. The latter had sought to recover support in arrears and her share in the they have alleged conclusions of law without stating any factual or legal basis. Mere mention of other civil cases without showing the
conjugal partnership. The children who allegedly substituted for her refused to continue the case against their father and vehemently identity of rights asserted and reliefs sought is not enough basis to claim that respondent is guilty of forum shopping, or that res
objected to their inclusion as parties.[29] Moreover, because he died during the pendency of the case, they were bound to substitute for judicata exists.[47]
the defendant also. The substitution effectively merged the persons of the plaintiff and the defendant and thus extinguished the WHEREFORE, the Petition is DENIED and the assailed Decision and Resolution are AFFIRMED. Costs against petitioners.
obligation being sued upon.[30] SO ORDERED.
Clearly, the present case is not similar, much less identical, to the factual milieu of Chittick. Sandoval-Gutierrez, Corona, Carpio-Morales, and Garcia, JJ., concur.
Strictly speaking, the rule on the substitution by heirs is not a matter of jurisdiction, but a requirement of due process. Thus, when SPOUSES ANTONIO F. ALGURA G.R. No. 150135
due process is not violated, as when the right of the representative or heir is recognized and protected, noncompliance or belated formal and LORENCITA S.J. ALGURA,
compliance with the Rules cannot affect the validity of a promulgated decision.[31] Mere failure to substitute for a deceased plaintiff is not Petitioners,
a sufficient ground to nullify a trial courts decision. The alleging party must prove that there was an undeniable violation of due process. Present:
Substitution in - versus - QUISUMBING, J., Chairperson,
the Instant Case CARPIO,
The records of the present case contain a Motion for Substitution of Party Plaintiff dated February 15, 2002, filed before the CA. CARPIO MORALES,
The prayer states as follows: THE LOCAL GOVERNMENT TINGA, and
WHEREFORE, it is respectfully prayed that the Heirs of the deceased plaintiff-appellee as represented by his daughter Lourdes dela Cruz UNIT OF THE CITY OF NAGA, VELASCO, JR., JJ.
be substituted as party-plaintiff for the said Pedro Joaquin. ATTY. MANUEL TEOXON,
It is further prayed that henceforth the undersigned counsel[32] for the heirs of Pedro Joaquin be furnished with copies of notices, orders, ENGR. LEON PALMIANO,
resolutions and other pleadings at its address below. NATHAN SERGIO and Promulgated:
Evidently, the heirs of Pedro Joaquin voluntary appeared and participated in the case. We stress that the appellate court had BENJAMIN NAVARRO, SR.,
ordered[33] his legal representatives to appear and substitute for him. The substitution even on appeal had been ordered correctly. In all Respondents. October 30, 2006
proceedings, the legal representatives must appear to protect the interests of the deceased.[34] After the rendition of judgment, further
proceedings may be held, such as a motion for reconsideration or a new trial, an appeal, or an execution.[35] x-----------------------------------------------------------------------------------------x
Considering the foregoing circumstances, the Motion for Substitution may be deemed to have been granted; and the heirs, to have
substituted for the deceased, Pedro Joaquin. There being no violation of due process, the issue of substitution cannot be upheld as a
ground to nullify the trial courts Decision. DECISION
Second Issue: VELASCO, JR., J.:
Forum Shopping
Petitioners also claim that respondents were guilty of forum shopping, a fact that should have compelled the trial court to dismiss Anyone who has ever struggled with poverty
the Complaint.[36] They claim that prior to the commencement of the present suit on July 7, 1981, respondent had filed a civil case against knows how extremely expensive it is to be poor.
petitioners on June 25, 1979. Docketed as Civil Case No. SD-742 for the recovery of possession and for damages, it was allegedly dismissed
by the Court of First Instance of Nueva Ecija for lack of interest to prosecute. James Baldwin
Forum Shopping Defined
Forum shopping is the institution of two or more actions or proceedings involving the same parties for the same cause of action, The Constitution affords litigantsmoneyed or poorequal access to the courts; moreover, it specifically provides that poverty
either simultaneously or successively, on the supposition that one or the other court would make a favorable disposition. [37] Forum shall not bar any person from having access to the courts.[1] Accordingly, laws and rules must be formulated, interpreted, and
shopping may be resorted to by a party against whom an adverse judgment or order has been issued in one forum, in an attempt to seek implemented pursuant to the intent and spirit of this constitutional provision. As such, filing fees, though one of the essential elements in
a favorable opinion in another, other than by an appeal or a special civil action for certiorari.[38] court procedures, should not be an obstacle to poor litigants opportunity to seek redress for their grievances before the courts.
Forum shopping trifles with the courts, abuses their processes, degrades the administration of justice, and congests court The Case
dockets.[39] Willful and deliberate violation of the rule against it is a ground for the summary dismissal of the case; it may also constitute
direct contempt of court.[40] This Petition for Review on Certiorari seeks the annulment of the September 11, 2001 Order of the Regional Trial Court (RTC) of Naga City,
The test for determining the existence of forum shopping is whether the elements of litis pendentia are present, or whether a final Branch 27, in Civil Case No. 99-4403 entitled Spouses Antonio F. Algura and Lorencita S.J. Algura v. The Local Government Unit of the City
judgment in one case amounts to res judicata in another.[41] We note, however, petitioners claim that the subject matter of the present of Naga, et al., dismissing the case for failure of petitioners Algura spouses to pay the required filing fees.[2] Since the instant petition
case has already been litigated and decided. Therefore, the applicable doctrine is res judicata.[42] involves only a question of law based on facts established from the pleadings and documents submitted by the parties,[3] the Court gives
Applicability of Res Judicata
due course to the instant petition sanctioned under Section 2(c) of Rule 41 on Appeal from the RTCs, and governed by Rule 45 of the 1997
Rules of Civil Procedure.
The Facts
On September 1, 1999, spouses Antonio F. Algura and Lorencita S.J. Algura filed a Verified Complaint dated August 30, 1999[4] for damages
against the Naga City Government and its officers, arising from the alleged illegal demolition of their residence and boarding house and
for payment of lost income derived from fees paid by their boarders amounting to PhP 7,000.00 monthly.
Simultaneously, petitioners filed an Ex-Parte Motion to Litigate as Indigent Litigants,[5] to which petitioner Antonio Alguras Pay Slip No.
2457360 (Annex A of motion) was appended, showing a gross monthly income of Ten Thousand Four Hundred Seventy Four Pesos (PhP
10,474.00) and a net pay of Three Thousand Six Hundred Sixteen Pesos and Ninety Nine Centavos (PhP 3,616.99) for [the month of] July
1999.[6] Also attached as Annex B to the motion was a July 14, 1999 Certification[7] issued by the Office of the City Assessor of Naga City,
which stated that petitioners had no property declared in their name for taxation purposes.
Finding that petitioners motion to litigate as indigent litigants was meritorious, Executive Judge Jose T. Atienza of the Naga City RTC, in the
September 1, 1999 Order,[8] granted petitioners plea for exemption from filing fees.
Meanwhile, as a result of respondent Naga City Governments demolition of a portion of petitioners house, the Alguras
allegedly lost a monthly income of PhP 7,000.00 from their boarders rentals. With the loss of the rentals, the meager income from
Lorencita Alguras sari-sari store and Antonio Alguras small take home pay became insufficient for the expenses of the Algura spouses and
their six (6) children for their basic needs including food, bills, clothes, and schooling, among others.
On October 13, 1999, respondents filed an Answer with Counterclaim dated October 10, 1999,[9] arguing that the defenses of the
petitioners in the complaint had no cause of action, the spouses boarding house blocked the road right of way, and said structure was a
nuisance per se.
Praying that the counterclaim of defendants (respondents) be dismissed, petitioners then filed their Reply with Ex-Parte Request for a Pre-
Trial Setting[10] before the Naga City RTC on October 19, 1999. On February 3, 2000, a pre-trial was held wherein respondents asked for
five (5) days within which to file a Motion to Disqualify Petitioners as Indigent Litigants.
On March 13, 2000, respondents filed a Motion to Disqualify the Plaintiffs for Non-Payment of Filing Fees dated March 10, 2000.[11] They
asserted that in addition to the more than PhP 3,000.00 net income of petitioner Antonio Algura, who is a member of the Philippine
National Police, spouse Lorencita Algura also had a mini-store and a computer shop on the ground floor of their residence along Bayawas
St., Sta. Cruz, Naga City. Also, respondents claimed that petitioners second floor was used as their residence and as a boarding house,
from which they earned more than PhP 3,000.00 a month. In addition, it was claimed that petitioners derived additional income from
their computer shop patronized by students and from several boarders who paid rentals to them. Hence, respondents concluded that
petitioners were not indigent litigants.
On March 28, 2000, petitioners subsequently interposed their Opposition to the Motion[12] to respondents motion to disqualify them for
non-payment of filing fees.
On April 14, 2000, the Naga City RTC issued an Order disqualifying petitioners as indigent litigants on the ground that they failed to
substantiate their claim for exemption from payment of legal fees and to comply with the third paragraph of Rule 141, Section 18 of the
Revised Rules of Courtdirecting them to pay the requisite filing fees.[13]
On April 28, 2000, petitioners filed a Motion for Reconsideration of the April 14, 2000 Order. On May 8, 2000, respondents then filed their
Comment/Objections to petitioners Motion for Reconsideration.
On May 5, 2000, the trial court issued an Order[14] giving petitioners the opportunity to comply with the requisites laid down in
Section 18, Rule 141, for them to qualify as indigent litigants.
On May 13, 2000, petitioners submitted their Compliance[15] attaching the affidavits of petitioner Lorencita Algura[16] and Erlinda
Bangate,[17] to comply with the requirements of then Rule 141, Section 18 of the Rules of Court and in support of their claim to be
declared as indigent litigants.
In her May 13, 2000 Affidavit, petitioner Lorencita Algura claimed that the demolition of their small dwelling deprived her of a
monthly income amounting to PhP 7,000.00. She, her husband, and their six (6) minor children had to rely mainly on her husbands salary
as a policeman which provided them a monthly amount of PhP 3,500.00, more or less. Also, they did not own any real property as
certified by the assessors office of Naga City. More so, according to her, the meager net income from her small sari-saristore and the
rentals of some boarders, plus the salary of her husband, were not enough to pay the familys basic necessities.
To buttress their position as qualified indigent litigants, petitioners also submitted the affidavit of Erlinda Bangate, who attested under
oath, that she personally knew spouses Antonio Algura and Lorencita Algura, who were her neighbors; that they derived substantial
income from their boarders; that they lost said income from their boarders rentals when the Local Government Unit of the City of Naga,
through its officers, demolished part of their house because from that time, only a few boarders could be accommodated; that the
income from the small store, the boarders, and the meager salary of Antonio Algura were insufficient for their basic necessities like food
and clothing, considering that the Algura spouses had six (6) children; and that she knew that petitioners did not own any real property.
Thereafter, Naga City RTC Acting Presiding Judge Andres B. Barsaga, Jr. issued his July 17, 2000[18] Order denying the petitioners Motion
for Reconsideration.
Judge Barsaga ratiocinated that the pay slip of Antonio F. Algura showed that the GROSS INCOME or TOTAL EARNINGS of
plaintiff Algura [was] ₧10,474.00 which amount [was] over and above the amount mentioned in the first paragraph of Rule 141, Section
18 for pauper litigants residing outside Metro Manila.[19] Said rule provides that the gross income of the litigant should not exceed PhP
3,000.00 a month and shall not own real estate with an assessed value of PhP 50,000.00. The trial court found that, in Lorencita S.J.
Alguras May 13, 2000 Affidavit, nowhere was it stated that she and her immediate family did not earn a gross income of PhP 3,000.00.
The Issue
Unconvinced of the said ruling, the Alguras instituted the instant petition raising a solitary issue for the consideration of the
Court: whether petitioners should be considered as indigent litigants who qualify for exemption from paying filing fees.
The Ruling of the Court
The petition is meritorious.
A review of the history of the Rules of Court on suits in forma pauperis (pauper litigant) is necessary before the Court rules on the issue of
the Algura spouses claim to exemption from paying filing fees.
When the Rules of Court took effect on January 1, 1964, the rule on pauper litigants was found in Rule 3, Section 22 which provided that:
SECTION 22. Pauper litigant.Any court may authorize a litigant to prosecute his action or defense as a
pauper upon a proper showing that he has no means to that effect by affidavits, certificate of the
corresponding provincial, city or municipal treasurer, or otherwise. Such authority[,] once given[,] shall
include an exemption from payment of legal fees and from filing appeal bond, printed record and printed
brief. The legal fees shall be a lien to any judgment rendered in the case [favorable] to the pauper, unless
the court otherwise provides.
From the same Rules of Court, Rule 141 on Legal Fees, on the other hand, did not contain any provision on pauper litigants.
On July 19, 1984, the Court, in Administrative Matter No. 83-6-389-0 (formerly G.R. No. 64274), approved the recommendation of the
Committee on the Revision of Rates and Charges of Court Fees, through its Chairman, then Justice Felix V. Makasiar, to revise the fees in
Rule 141 of the Rules of Court to generate funds to effectively cover administrative costs for services rendered by the courts.[20] A
provision on pauper litigants was inserted which reads:
SECTION 16. Pauper-litigants exempt from payment of court fees.Pauper-litigants include wage earners
whose gross income do not exceed P2,000.00 a month or P24,000.00 a year for those residing in Metro
Manila, and P1,500.00 a month or P18,000.00 a year for those residing outside Metro Manila, or those who
do not own real property with an assessed value of not more than P24,000.00, or not more than
P18,000.00 as the case may be.
 Such exemption shall include exemption from payment of fees for filing appeal bond, printed record and
printed brief.
The legal fees shall be a lien on the monetary or property judgment rendered in favor of the pauper-
litigant.
To be entitled to the exemption herein provided, the pauper-litigant shall execute an affidavit that he does
not earn the gross income abovementioned, nor own any real property with the assessed value afore-
mentioned [sic], supported by a certification to that effect by the provincial, city or town assessor or
treasurer.
When the Rules of Court on Civil Procedure were amended by the 1997 Rules of Civil Procedure (inclusive of Rules 1 to 71) in Supreme
Court Resolution in Bar Matter No. 803 dated April 8, 1997, which became effective on July 1, 1997, Rule 3, Section 22 of the Revised
Rules of Court was superseded by Rule 3, Section 21 of said 1997 Rules of Civil Procedure, as follows:
SECTION 21. Indigent party.A party may be authorized to litigate his action, claim or defense as an indigent
if the court, upon an ex parte application and hearing, is satisfied that the party is one who has no money
or property sufficient and available for food, shelter and basic necessities for himself and his family.
Such authority shall include an exemption from payment of docket and other lawful fees, and of transcripts
of stenographic notes which the court may order to be furnished him. The amount of the docket and other
lawful fees which the indigent was exempted from paying shall be a lien on any judgment rendered in the
case favorable to the indigent, unless the court otherwise provides.
Any adverse party may contest the grant of such authority at any time before judgment is rendered by the
trial court. If the court should determine after hearing that the party declared as an indigent is in fact a
person with sufficient income or property, the proper docket and other lawful fees shall be assessed and
collected by the clerk of court. If payment is not made within the time fixed by the court, execution shall
issue for the payment thereof, without prejudice to such other sanctions as the court may impose.
At the time the Rules on Civil Procedure were amended by the Court in Bar Matter No. 803, however, there was no amendment made on
Rule 141, Section 16 on pauper litigants.
On March 1, 2000, Rule 141 on Legal Fees was amended by the Court in A.M. No. 00-2-01-SC, whereby certain fees were increased or
adjusted. In this Resolution, the Court amended Section 16 of Rule 141, making it Section 18, which now reads:
SECTION 18. Pauper-litigants exempt from payment of legal fees.Pauper litigants (a) whose gross income
and that of their immediate family do not exceed four thousand (P4,000.00) pesos a month if residing in
Metro Manila, and three thousand (P3,000.00) pesos a month if residing outside Metro Manila, and (b)
who do not own real property with an assessed value of more than fifty thousand (P50,000.00) pesos shall
be exempt from the payment of legal fees.
The legal fees shall be a lien on any judgment rendered in the case favorably to the pauper litigant, unless
the court otherwise provides.
To be entitled to the exemption herein provided, the litigant shall execute an affidavit that he and his
immediate family do not earn the gross income abovementioned, nor do they own any real property with
the assessed value aforementioned, supported by an affidavit of a disinterested person attesting to the
truth of the litigants affidavit.
Any falsity in the affidavit of a litigant or disinterested person shall be sufficient cause to strike out the
pleading of that party, without prejudice to whatever criminal liability may have been incurred.
It can be readily seen that the rule on pauper litigants was inserted in Rule 141 without revoking or amending Section 21 of Rule 3, which
provides for the exemption of pauper litigants from payment of filing fees. Thus, on March 1, 2000, there were two existing rules on
pauper litigants; namely, Rule 3, Section 21 and Rule 141, Section 18.
On August 16, 2004, Section 18 of Rule 141 was further amended in Administrative Matter No. 04-2-04-SC, which became effective on the
same date. It then became Section 19 of Rule 141, to wit:
SEC. 19. Indigent litigants exempt from payment of legal fees.INDIGENT LITIGANTS (A) WHOSE GROSS
INCOME AND THAT OF THEIR IMMEDIATE FAMILY DO NOT EXCEED AN AMOUNT DOUBLE THE MONTHLY
MINIMUM WAGE OF AN EMPLOYEE AND (B) WHO DO NOT OWN REAL PROPERTY WITH A FAIR MARKET
VALUE AS STATED IN THE CURRENT TAX DECLARATION OF MORE THAN THREE HUNDRED THOUSAND
(P300,000.00) PESOS SHALL BE EXEMPT FROM PAYMENT OF LEGAL FEES.
The legal fees shall be a lien on any judgment rendered in the case favorable to the indigent litigant unless
the court otherwise provides.
To be entitled to the exemption herein provided, the litigant shall execute an affidavit that he and his
immediate family do not earn a gross income abovementioned, and they do not own any real property
with the fair value aforementioned, supported by an affidavit of a disinterested person attesting to the
truth of the litigants affidavit. The current tax declaration, if any, shall be attached to the litigants affidavit.
Any falsity in the affidavit of litigant or disinterested person shall be sufficient cause to dismiss the
complaint or action or to strike out the pleading of that party, without prejudice to whatever criminal
liability may have been incurred. (Emphasis supplied.)
Amendments to Rule 141 (including the amendment to Rule 141, Section 18) were made to implement RA 9227 which brought about new
increases in filing fees. Specifically, in the August 16, 2004 amendment, the ceiling for the gross income of litigants applying for exemption
and that of their immediate family was increased from PhP 4,000.00 a month in Metro Manila and PhP 3,000.00 a month outside Metro
Manila, to double the monthly minimum wage of an employee; and the maximum value of the property owned by the applicant was
increased from an assessed value of PhP 50,000.00 to a maximum market value of PhP 300,000.00, to be able to accommodate more
indigent litigants and promote easier access to justice by the poor and the marginalized in the wake of these new increases in filing fees.
Even if there was an amendment to Rule 141 on August 16, 2004, there was still no amendment or recall of Rule 3, Section 21 on indigent
litigants.
With this historical backdrop, let us now move on to the sole issuewhether petitioners are exempt from the payment of filing fees.
It is undisputed that the Complaint (Civil Case No. 99-4403) was filed on September 1, 1999. However, the Naga City RTC, in its April 14,
2000 and July 17, 2000 Orders, incorrectly applied Rule 141, Section 18 on Legal Fees when the applicable rules at that time were Rule 3,
Section 21 on Indigent Party which took effect on July 1, 1997 and Rule 141, Section 16 on Pauper Litigants which became effective on
July 19, 1984 up to February 28, 2000.
The old Section 16, Rule 141 requires applicants to file an ex-parte motion to litigate as a pauper litigant by submitting an affidavit that
they do not have a gross income of PhP 2,000.00 a month or PhP 24,000.00 a year for those residing in Metro Manila and PhP 1,500.00 a
month or PhP 18,000.00 a year for those residing outside Metro Manila or those who do not own real property with an assessed value of
not more than PhP 24,000.00 or not more than PhP 18,000.00 as the case may be. Thus, there are two requirements: a) income
requirementthe applicants should not have a gross monthly income of more than PhP 1,500.00, and b) property requirementthey should
not own property with an assessed value of not more than PhP 18,000.00.
In the case at bar, petitioners Alguras submitted the Affidavits of petitioner Lorencita Algura and neighbor Erlinda Bangate, the pay slip of
petitioner Antonio F. Algura showing a gross monthly income of PhP 10,474.00,[21] and a Certification of the Naga City assessor stating that
petitioners do not have property declared in their names for taxation.[22]Undoubtedly, petitioners do not own real property as shown by
the Certification of the Naga City assessor and so the property requirement is met. However with respect to the income requirement, it is
clear that the gross monthly income of PhP 10,474.00 of petitioner Antonio F. Algura and the PhP 3,000.00 income of Lorencita Algura
when combined, were above the PhP 1,500.00 monthly income threshold prescribed by then Rule 141, Section 16 and therefore, the
income requirement was not satisfied. The trial court was therefore correct in disqualifying petitioners Alguras as indigent litigants
although the court should have applied Rule 141, Section 16 which was in effect at the time of the filing of the application on September
1, 1999. Even if Rule 141, Section 18 (which superseded Rule 141, Section 16 on March 1, 2000) were applied, still the application could
not have been granted as the combined PhP 13,474.00 income of petitioners was beyond the PhP 3,000.00 monthly income threshold.
Unrelenting, petitioners however argue in their Motion for Reconsideration of the April 14, 2000 Order disqualifying them as indigent
litigants[23] that the rules have been relaxed by relying on Rule 3, Section 21 of the 1997 Rules of Civil procedure which authorizes parties
to litigate their action as indigents if the court is satisfied that the party is one who has no money or property sufficient and available for
food, shelter and basic necessities for himself and his family. The trial court did not give credence to this view of petitioners and simply
applied Rule 141 but ignored Rule 3, Section 21 on Indigent Party.
The position of petitioners on the need to use Rule 3, Section 21 on their application to litigate as indigent litigants brings to the fore the
issue on whether a trial court has to apply both Rule 141, Section 16 and Rule 3, Section 21 on such applications or should the court apply
only Rule 141, Section 16 and discard Rule 3, Section 21 as having been superseded by Rule 141, Section 16 on Legal Fees.
The Court rules that Rule 3, Section 21 and Rule 141, Section 16 (later amended as Rule 141, Section 18 on March 1, 2000 and
subsequently amended by Rule 141, Section 19 on August 16, 2003, which is now the present rule) are still valid and enforceable rules on
indigent litigants.
For one, the history of the two seemingly conflicting rules readily reveals that it was not the intent of the Court to consider the old Section
22 of Rule 3, which took effect on January 1, 1994 to have been amended and superseded by Rule 141, Section 16, which took effect
on July 19, 1984 through A.M. No. 83-6-389-0. If that is the case, then the Supreme Court, upon the recommendation of the Committee
on the Revision on Rules, could have already deleted Section 22 from Rule 3 when it amended Rules 1 to 71 and approved the 1997 Rules
of Civil Procedure, which took effect on July 1, 1997. The fact that Section 22 which became Rule 3, Section 21 on indigent litigant was
retained in the rules of procedure, even elaborating on the meaning of an indigent party, and was also strengthened by the addition of a
third paragraph on the right to contest the grant of authority to litigate only goes to show that there was no intent at all to consider said
rule as expunged from the 1997 Rules of Civil Procedure.
Furthermore, Rule 141 on indigent litigants was amended twice: first on March 1, 2000 and the second on August 16, 2004; and yet,
despite these two amendments, there was no attempt to delete Section 21 from said Rule 3. This clearly evinces the desire of the Court to
maintain the two (2) rules on indigent litigants to cover applications to litigate as an indigent litigant.
It may be argued that Rule 3, Section 21 has been impliedly repealed by the recent 2000 and 2004 amendments to Rule 141 on legal
fees. This position is bereft of merit. Implied repeals are frowned upon unless the intent of the framers of the rules is unequivocal. It has
been consistently ruled that:
(r)epeals by implication are not favored, and will not be decreed, unless it is manifest that the legislature
so intended. As laws are presumed to be passed with deliberation and with full knowledge of all existing
ones on the subject, it is but reasonable to conclude that in passing a statute[,] it was not intended to
interfere with or abrogate any former law relating to same matter, unless the repugnancy between the
two is not only irreconcilable, but also clear and convincing, and flowing necessarily from the language
used, unless the later act fully embraces the subject matter of the earlier, or unless the reason for the
earlier act is beyond peradventure removed. Hence, every effort must be used to make all acts stand and
if, by any reasonable construction they can be reconciled, the later act will not operate as a repeal of the
earlier.[24] (Emphasis supplied).
Instead of declaring that Rule 3, Section 21 has been superseded and impliedly amended by Section 18 and later Section 19 of Rule 141,
the Court finds that the two rules can and should be harmonized.
The Court opts to reconcile Rule 3, Section 21 and Rule 141, Section 19 because it is a settled principle that when conflicts are seen
between two provisions, all efforts must be made to harmonize them. Hence, every statute [or rule] must be so construed and
harmonized with other statutes [or rules] as to form a uniform system of jurisprudence.[25]
In Manila Jockey Club, Inc. v. Court of Appeals, this Court enunciated that in the interpretation of seemingly conflicting laws, efforts must
be made to first harmonize them. This Court thus ruled:
Consequently, every statute should be construed in such a way that will harmonize it with existing
laws. This principle is expressed in the legal maxim interpretare et concordare leges legibus est optimus
interpretandi, that is, to interpret and to do it in such a way as to harmonize laws with laws is the best
method of interpretation.[26]
In the light of the foregoing considerations, therefore, the two (2) rules can stand together and are compatible with each other. When an
application to litigate as an indigent litigant is filed, the court shall scrutinize the affidavits and supporting documents submitted by the
applicant to determine if the applicant complies with the income and property standards prescribed in the present Section 19 of Rule
141that is, the applicants gross income and that of the applicants immediate family do not exceed an amount double the monthly
minimum wage of an employee; and the applicant does not own real property with a fair market value of more than Three Hundred
Thousand Pesos (PhP 300,000.00). If the trial court finds that the applicant meets the income and property requirements, the authority to
litigate as indigent litigant is automatically granted and the grant is a matter of right.
However, if the trial court finds that one or both requirements have not been met, then it would set a hearing to enable the applicant to
prove that the applicant has no money or property sufficient and available for food, shelter and basic necessities for himself and his
family. In that hearing, the adverse party may adduce countervailing evidence to disprove the evidence presented by the applicant; after
which the trial court will rule on the application depending on the evidence adduced. In addition, Section 21 of Rule 3 also provides that
the adverse party may later still contest the grant of such authority at any time before judgment is rendered by the trial court, possibly
based on newly discovered evidence not obtained at the time the application was heard. If the court determines after hearing, that the
party declared as an indigent is in fact a person with sufficient income or property, the proper docket and other lawful fees shall be
assessed and collected by the clerk of court. If payment is not made within the time fixed by the court, execution shall issue or the
payment of prescribed fees shall be made, without prejudice to such other sanctions as the court may impose.
The Court concedes that Rule 141, Section 19 provides specific standards while Rule 3, Section 21 does not clearly draw the limits of the
entitlement to the exemption. Knowing that the litigants may abuse the grant of authority, the trial court must use sound discretion and
scrutinize evidence strictly in granting exemptions, aware that the applicant has not hurdled the precise standards under Rule 141. The
trial court must also guard against abuse and misuse of the privilege to litigate as an indigent litigant to prevent the filing of exorbitant
claims which would otherwise be regulated by a legal fee requirement.
Thus, the trial court should have applied Rule 3, Section 21 to the application of the Alguras after their affidavits and supporting
documents showed that petitioners did not satisfy the twin requirements on gross monthly income and ownership of real property under
Rule 141. Instead of disqualifying the Alguras as indigent litigants, the trial court should have called a hearing as required by Rule 3,
Section 21 to enable the petitioners to adduce evidence to show that they didnt have property and money sufficient and available for
food, shelter, and basic necessities for them and their family.[27] In that hearing, the respondents would have had the right to also present
evidence to refute the allegations and evidence in support of the application of the petitioners to litigate as indigent litigants. Since this
Court is not a trier of facts, it will have to remand the case to the trial court to determine whether petitioners can be considered as
indigent litigants using the standards set in Rule 3, Section 21.
Recapitulating the rules on indigent litigants, therefore, if the applicant for exemption meets the salary and property requirements under
Section 19 of Rule 141, then the grant of the application is mandatory. On the other hand, when the application does not satisfy one or
both requirements, then the application should not be denied outright; instead, the court should apply the indigency test under Section
21 of Rule 3 and use its sound discretion in determining the merits of the prayer for exemption.
Access to justice by the impoverished is held sacrosanct under Article III, Section 11 of the 1987 Constitution. The Action Program for
Judicial Reforms (APJR) itself, initiated by former Chief Justice Hilario G. Davide, Jr., placed prime importance on easy access to justice by
the poor as one of its six major components. Likewise, the judicial philosophy of Liberty and Prosperity of Chief Justice Artemio V.
Panganiban makes it imperative that the courts shall not only safeguard but also enhance the rights of individualswhich are considered
sacred under the 1987 Constitution. Without doubt, one of the most precious rights which must be shielded and secured is the Admission, Short-Time Admission Rates, and Wash-Up Rate Schemes in Hotels, Motels, Inns, Lodging Houses, Pension Houses, and Similar
unhampered access to the justice system by the poor, the underprivileged, and the marginalized. Establishments in the City of Manila" (the Ordinance).
WHEREFORE, the petition is GRANTED and the April 14, 2000 Order granting the disqualification of petitioners, the July 17, 2000 Order I.
denying petitioners Motion for Reconsideration, and the September 11, 2001 Order dismissing the case in Civil Case No. RTC-99-4403 The facts are as follows:
before the Naga City RTC, Branch 27 are ANNULLED and SET ASIDE. Furthermore, the Naga City RTC is ordered to set the Ex-Parte Motion On December 3, 1992, City Mayor Alfredo S. Lim (Mayor Lim) signed into law the Ordinance.4 The Ordinance is reproduced in full,
to Litigate as Indigent Litigants for hearing and apply Rule 3, Section 21 of the 1997 Rules of Civil Procedure to determine whether hereunder:
petitioners can qualify as indigent litigants. SECTION 1. Declaration of Policy. It is hereby the declared policy of the City Government to protect the best interest, health and welfare,
and the morality of its constituents in general and the youth in particular.
No costs. SEC. 2. Title. This ordinance shall be known as "An Ordinance" prohibiting short time admission in hotels, motels, lodging houses, pension
SO ORDERED. houses and similar establishments in the City of Manila.
SEC. 3. Pursuant to the above policy, short-time admission and rate [sic], wash-up rate or other similarly concocted terms, are hereby
prohibited in hotels, motels, inns, lodging houses, pension houses and similar establishments in the City of Manila.
PRESBITERO J. VELASCO, JR. SEC. 4. Definition of Term[s]. Short-time admission shall mean admittance and charging of room rate for less than twelve (12) hours at any
Associate Justice given time or the renting out of rooms more than twice a day or any other term that may be concocted by owners or managers of said
establishments but would mean the same or would bear the same meaning.
SEC. 5. Penalty Clause. Any person or corporation who shall violate any provision of this ordinance shall upon conviction thereof be
punished by a fine of Five Thousand (₱5,000.00) Pesos or imprisonment for a period of not exceeding one (1) year or both such fine and
imprisonment at the discretion of the court; Provided, That in case of [a] juridical person, the president, the manager, or the persons in
WE CONCUR: charge of the operation thereof shall be liable: Provided, further, That in case of subsequent conviction for the same offense, the business
license of the guilty party shall automatically be cancelled.
SEC. 6. Repealing Clause. Any or all provisions of City ordinances not consistent with or contrary to this measure or any portion hereof are
LEONARDO A. QUISUMBING hereby deemed repealed.
Associate Justice SEC. 7. Effectivity. This ordinance shall take effect immediately upon approval.
Chairperson Enacted by the city Council of Manila at its regular session today, November 10, 1992.
Approved by His Honor, the Mayor on December 3, 1992.
On December 15, 1992, the Malate Tourist and Development Corporation (MTDC) filed a complaint for declaratory relief with prayer for a
writ of preliminary injunction and/or temporary restraining order ( TRO)5 with the Regional Trial Court (RTC) of Manila, Branch 9
impleading as defendant, herein respondent City of Manila (the City) represented by Mayor Lim.6 MTDC prayed that the Ordinance,
insofar as it includes motels and inns as among its prohibited establishments, be declared invalid and unconstitutional. MTDC claimed that
ANTONIO T. CARPIO CONCHITA CARPIO MORALES as owner and operator of the Victoria Court in Malate, Manila it was authorized by Presidential Decree (P.D.) No. 259 to admit customers
Associate Justice Associate Justice on a short time basis as well as to charge customers wash up rates for stays of only three hours.
On December 21, 1992, petitioners White Light Corporation (WLC), Titanium Corporation (TC) and Sta. Mesa Tourist and Development
Corporation (STDC) filed a motion to intervene and to admit attached complaint-in-intervention7 on the ground that the Ordinance
directly affects their business interests as operators of drive-in-hotels and motels in Manila.8 The three companies are components of the
Anito Group of Companies which owns and operates several hotels and motels in Metro Manila.9
On December 23, 1992, the RTC granted the motion to intervene.10 The RTC also notified the Solicitor General of the proceedings
DANTE O. TINGA pursuant to then Rule 64, Section 4 of the Rules of Court. On the same date, MTDC moved to withdraw as plaintiff.11
Associate Justice On December 28, 1992, the RTC granted MTDC's motion to withdraw.12 The RTC issued a TRO on January 14, 1993, directing the City to
cease and desist from enforcing the Ordinance.13 The City filed an Answer dated January 22, 1993 alleging that the Ordinance is a
G.R. No. 122846 January 20, 2009 legitimate exercise of police power.14
WHITE LIGHT CORPORATION, TITANIUM CORPORATION and STA. MESA TOURIST & DEVELOPMENT CORPORATION, Petitioners, On February 8, 1993, the RTC issued a writ of preliminary injunction ordering the city to desist from the enforcement of the Ordinance.15 A
vs. month later, on March 8, 1993, the Solicitor General filed his Comment arguing that the Ordinance is constitutional.
CITY OF MANILA, represented by DE CASTRO, MAYOR ALFREDO S. LIM, Respondent. During the pre-trial conference, the WLC, TC and STDC agreed to submit the case for decision without trial as the case involved a purely
DECISION legal question.16 On October 20, 1993, the RTC rendered a decision declaring the Ordinance null and void. The dispositive portion of the
Tinga, J.: decision reads:
With another city ordinance of Manila also principally involving the tourist district as subject, the Court is confronted anew with the WHEREFORE, in view of all the foregoing, [O]rdinance No. 7774 of the City of Manila is hereby declared null and void.
incessant clash between government power and individual liberty in tandem with the archetypal tension between law and morality. Accordingly, the preliminary injunction heretofor issued is hereby made permanent.
In City of Manila v. Laguio, Jr.,1 the Court affirmed the nullification of a city ordinance barring the operation of motels and inns, among SO ORDERED.17
other establishments, within the Ermita-Malate area. The petition at bar assails a similarly-motivated city ordinance that prohibits those The RTC noted that the ordinance "strikes at the personal liberty of the individual guaranteed and jealously guarded by the
same establishments from offering short-time admission, as well as pro-rated or "wash up" rates for such abbreviated stays. Our earlier Constitution."18 Reference was made to the provisions of the Constitution encouraging private enterprises and the incentive to needed
decision tested the city ordinance against our sacred constitutional rights to liberty, due process and equal protection of law. The same investment, as well as the right to operate economic enterprises. Finally, from the observation that the illicit relationships the Ordinance
parameters apply to the present petition. sought to dissuade could nonetheless be consummated by simply paying for a 12-hour stay, the RTC likened the law to the ordinance
This Petition2 under Rule 45 of the Revised Rules on Civil Procedure, which seeks the reversal of the Decision3 in C.A.-G.R. S.P. No. 33316 annulled in Ynot v. Intermediate Appellate Court,19 where the legitimate purpose of preventing indiscriminate slaughter of carabaos was
of the Court of Appeals, challenges the validity of Manila City Ordinance No. 7774 entitled, "An Ordinance Prohibiting Short-Time sought to be effected through an inter-province ban on the transport of carabaos and carabeef.
The City later filed a petition for review on certiorari with the Supreme Court.20 The petition was docketed as G.R. No. 112471. However in
a resolution dated January 26, 1994, the Court treated the petition as a petition for certiorari and referred the petition to the Court of
Appeals.21
Before the Court of Appeals, the City asserted that the Ordinance is a valid exercise of police power pursuant to Section 458 (4)(iv) of the
Local Government Code which confers on cities, among other local government units, the power:
[To] regulate the establishment, operation and maintenance of cafes, restaurants, beerhouses, hotels, motels, inns, pension houses,
lodging houses and other similar establishments, including tourist guides and transports.22
The Ordinance, it is argued, is also a valid exercise of the power of the City under Article III, Section 18(kk) of the Revised Manila Charter,
thus:
"to enact all ordinances it may deem necessary and proper for the sanitation and safety, the furtherance of the prosperity and the
promotion of the morality, peace, good order, comfort, convenience and general welfare of the city and its inhabitants, and such others
as be necessary to carry into effect and discharge the powers and duties conferred by this Chapter; and to fix penalties for the violation of
ordinances which shall not exceed two hundred pesos fine or six months imprisonment, or both such fine and imprisonment for a single
offense.23
Petitioners argued that the Ordinance is unconstitutional and void since it violates the right to privacy and the freedom of movement; it is
an invalid exercise of police power; and it is an unreasonable and oppressive interference in their business.
The Court of Appeals reversed the decision of the RTC and affirmed the constitutionality of the Ordinance. 24 First, it held that the
Ordinance did not violate the right to privacy or the freedom of movement, as it only penalizes the owners or operators of establishments
that admit individuals for short time stays. Second, the virtually limitless reach of police power is only constrained by having a lawful
object obtained through a lawful method. The lawful objective of the Ordinance is satisfied since it aims to curb immoral activities. There
is a lawful method since the establishments are still allowed to operate. Third, the adverse effect on the establishments is justified by the
well-being of its constituents in general. Finally, as held in Ermita-Malate Motel Operators Association v. City Mayor of Manila, liberty is
regulated by law.
TC, WLC and STDC come to this Court via petition for review on certiorari.25 In their petition and Memorandum, petitioners in essence
repeat the assertions they made before the Court of Appeals. They contend that the assailed Ordinance is an invalid exercise of police
power.
II.
We must address the threshold issue of petitioners’ standing. Petitioners allege that as owners of establishments offering "wash-up"
rates, their business is being unlawfully interfered with by the Ordinance. However, petitioners also allege that the equal protection rights
of their clients are also being interfered with. Thus, the crux of the matter is whether or not these establishments have the requisite
standing to plead for protection of their patrons' equal protection rights.
Standing or locus standi is the ability of a party to demonstrate to the court sufficient connection to and harm from the law or action
challenged to support that party's participation in the case. More importantly, the doctrine of standing is built on the principle of
separation of powers,26 sparing as it does unnecessary interference or invalidation by the judicial branch of the actions rendered by its co-
equal branches of government.
The requirement of standing is a core component of the judicial system derived directly from the Constitution. 27 The constitutional
component of standing doctrine incorporates concepts which concededly are not susceptible of precise definition. 28 In this jurisdiction,
the extancy of "a direct and personal interest" presents the most obvious cause, as well as the standard test for a petitioner's
standing.29 In a similar vein, the United States Supreme Court reviewed and elaborated on the meaning of the three constitutional
standing requirements of injury, causation, and redressability in Allen v. Wright.30
Nonetheless, the general rules on standing admit of several exceptions such as the overbreadth doctrine, taxpayer suits, third party
standing and, especially in the Philippines, the doctrine of transcendental importance.31
For this particular set of facts, the concept of third party standing as an exception and the overbreadth doctrine are appropriate.
In Powers v. Ohio,32 the United States Supreme Court wrote that: "We have recognized the right of litigants to bring actions on behalf of
third parties, provided three important criteria are satisfied: the litigant must have suffered an ‘injury-in-fact,’ thus giving him or her a
"sufficiently concrete interest" in the outcome of the issue in dispute; the litigant must have a close relation to the third party; and there
must exist some hindrance to the third party's ability to protect his or her own interests." 33 Herein, it is clear that the business interests of
the petitioners are likewise injured by the Ordinance. They rely on the patronage of their customers for their continued viability which
appears to be threatened by the enforcement of the Ordinance. The relative silence in constitutional litigation of such special interest
groups in our nation such as the American Civil Liberties Union in the United States may also be construed as a hindrance for customers to
bring suit.34
American jurisprudence is replete with examples where parties-in-interest were allowed standing to advocate or invoke the fundamental
due process or equal protection claims of other persons or classes of persons injured by state action. In Griswold v. Connecticut,35 the
United States Supreme Court held that physicians had standing to challenge a reproductive health statute that would penalize them as
accessories as well as to plead the constitutional protections available to their patients. The Court held that:
"The rights of husband and wife, pressed here, are likely to be diluted or adversely affected unless those rights are considered in a suit
involving those who have this kind of confidential relation to them."36
An even more analogous example may be found in Craig v. Boren,37 wherein the United States Supreme Court held that a licensed
beverage vendor has standing to raise the equal protection claim of a male customer challenging a statutory scheme prohibiting the sale
of beer to males under the age of 21 and to females under the age of 18. The United States High Court explained that the vendors had
standing "by acting as advocates of the rights of third parties who seek access to their market or function."38
Assuming arguendo that petitioners do not have a relationship with their patrons for the former to assert the rights of the latter, the
overbreadth doctrine comes into play. In overbreadth analysis, challengers to government action are in effect permitted to raise the rights
of third parties. Generally applied to statutes infringing on the freedom of speech, the overbreadth doctrine applies when a statute
needlessly restrains even constitutionally guaranteed rights.39 In this case, the petitioners claim that the Ordinance makes a sweeping
intrusion into the right to liberty of their clients. We can see that based on the allegations in the petition, the Ordinance suffers from
overbreadth.
We thus recognize that the petitioners have a right to assert the constitutional rights of their clients to patronize their establishments for
a "wash-rate" time frame.
III.
To students of jurisprudence, the facts of this case will recall to mind not only the recent City of Manila ruling, but our 1967 decision
in Ermita-Malate Hotel and Motel Operations Association, Inc., v. Hon. City Mayor of Manila.40Ermita-Malate concerned the City
ordinance requiring patrons to fill up a prescribed form stating personal information such as name, gender, nationality, age, address and
occupation before they could be admitted to a motel, hotel or lodging house. This earlier ordinance was precisely enacted to minimize
certain practices deemed harmful to public morals. A purpose similar to the annulled ordinance in City of Manila which sought a blanket
ban on motels, inns and similar establishments in the Ermita-Malate area. However, the constitutionality of the ordinance in Ermita-
Malate was sustained by the Court.
The common thread that runs through those decisions and the case at bar goes beyond the singularity of the localities covered under the
respective ordinances. All three ordinances were enacted with a view of regulating public morals including particular illicit activity in
transient lodging establishments. This could be described as the middle case, wherein there is no wholesale ban on motels and hotels but
the services offered by these establishments have been severely restricted. At its core, this is another case about the extent to which the
State can intrude into and regulate the lives of its citizens.
The test of a valid ordinance is well established. A long line of decisions including City of Manila has held that for an ordinance to be valid,
it must not only be within the corporate powers of the local government unit to enact and pass according to the procedure prescribed by
law, it must also conform to the following substantive requirements: (1) must not contravene the Constitution or any statute; (2) must not
be unfair or oppressive; (3) must not be partial or discriminatory; (4) must not prohibit but may regulate trade; (5) must be general and
consistent with public policy; and (6) must not be unreasonable.41
The Ordinance prohibits two specific and distinct business practices, namely wash rate admissions and renting out a room more than
twice a day. The ban is evidently sought to be rooted in the police power as conferred on local government units by the Local Government
Code through such implements as the general welfare clause.
A.
Police power, while incapable of an exact definition, has been purposely veiled in general terms to underscore its comprehensiveness to
meet all exigencies and provide enough room for an efficient and flexible response as the conditions warrant.42 Police power is based
upon the concept of necessity of the State and its corresponding right to protect itself and its people.43 Police power has been used as
justification for numerous and varied actions by the State. These range from the regulation of dance halls,44 movie theaters,45 gas
stations46 and cockpits.47 The awesome scope of police power is best demonstrated by the fact that in its hundred or so years of presence
in our nation’s legal system, its use has rarely been denied.
The apparent goal of the Ordinance is to minimize if not eliminate the use of the covered establishments for illicit sex, prostitution, drug
use and alike. These goals, by themselves, are unimpeachable and certainly fall within the ambit of the police power of the State. Yet the
desirability of these ends do not sanctify any and all means for their achievement. Those means must align with the Constitution, and our
emerging sophisticated analysis of its guarantees to the people. The Bill of Rights stands as a rebuke to the seductive theory of
Macchiavelli, and, sometimes even, the political majorities animated by his cynicism.
Even as we design the precedents that establish the framework for analysis of due process or equal protection questions, the courts are
naturally inhibited by a due deference to the co-equal branches of government as they exercise their political functions. But when we are
compelled to nullify executive or legislative actions, yet another form of caution emerges. If the Court were animated by the same passing
fancies or turbulent emotions that motivate many political decisions, judicial integrity is compromised by any perception that the judiciary
is merely the third political branch of government. We derive our respect and good standing in the annals of history by acting as judicious
and neutral arbiters of the rule of law, and there is no surer way to that end than through the development of rigorous and sophisticated
legal standards through which the courts analyze the most fundamental and far-reaching constitutional questions of the day.
B.
The primary constitutional question that confronts us is one of due process, as guaranteed under Section 1, Article III of the Constitution.
Due process evades a precise definition.48 The purpose of the guaranty is to prevent arbitrary governmental encroachment against the
life, liberty and property of individuals. The due process guaranty serves as a protection against arbitrary regulation or seizure. Even
corporations and partnerships are protected by the guaranty insofar as their property is concerned.
The due process guaranty has traditionally been interpreted as imposing two related but distinct restrictions on government, "procedural
due process" and "substantive due process." Procedural due process refers to the procedures that the government must follow before it
deprives a person of life, liberty, or property.49 Procedural due process concerns itself with government action adhering to the established
process when it makes an intrusion into the private sphere. Examples range from the form of notice given to the level of formality of a
hearing.
If due process were confined solely to its procedural aspects, there would arise absurd situation of arbitrary government action, provided
the proper formalities are followed. Substantive due process completes the protection envisioned by the due process clause. It inquires
whether the government has sufficient justification for depriving a person of life, liberty, or property.50
The question of substantive due process, moreso than most other fields of law, has reflected dynamism in progressive legal thought tied
with the expanded acceptance of fundamental freedoms. Police power, traditionally awesome as it may be, is now confronted with a
more rigorous level of analysis before it can be upheld. The vitality though of constitutional due process has not been predicated on the
frequency with which it has been utilized to achieve a liberal result for, after all, the libertarian ends should sometimes yield to the
prerogatives of the State. Instead, the due process clause has acquired potency because of the sophisticated methodology that has
emerged to determine the proper metes and bounds for its application.
C.
The general test of the validity of an ordinance on substantive due process grounds is best tested when assessed with the evolved
footnote 4 test laid down by the U.S. Supreme Court in U.S. v. Carolene Products. 51 Footnote 4 of the Carolene Products case
acknowledged that the judiciary would defer to the legislature unless there is a discrimination against a "discrete and insular" minority or
infringement of a "fundamental right."52 Consequently, two standards of judicial review were established: strict scrutiny for laws dealing
with freedom of the mind or restricting the political process, and the rational basis standard of review for economic legislation.
A third standard, denominated as heightened or immediate scrutiny, was later adopted by the U.S. Supreme Court for evaluating
classifications based on gender53 and legitimacy.54 Immediate scrutiny was adopted by the U.S. Supreme Court in Craig,55 after the Court
declined to do so in Reed v. Reed.56 While the test may have first been articulated in equal protection analysis, it has in the United States
since been applied in all substantive due process cases as well.
We ourselves have often applied the rational basis test mainly in analysis of equal protection challenges. 57 Using the rational basis
examination, laws or ordinances are upheld if they rationally further a legitimate governmental interest. 58 Under intermediate review,
governmental interest is extensively examined and the availability of less restrictive measures is considered.59 Applying strict scrutiny, the
focus is on the presence of compelling, rather than substantial, governmental interest and on the absence of less restrictive means for
achieving that interest.
In terms of judicial review of statutes or ordinances, strict scrutiny refers to the standard for determining the quality and the amount of
governmental interest brought to justify the regulation of fundamental freedoms.60 Strict scrutiny is used today to test the validity of laws
dealing with the regulation of speech, gender, or race as well as other fundamental rights as expansion from its earlier applications to
equal protection.61 The United States Supreme Court has expanded the scope of strict scrutiny to protect fundamental rights such as
suffrage,62 judicial access63and interstate travel.64
If we were to take the myopic view that an Ordinance should be analyzed strictly as to its effect only on the petitioners at bar, then it
would seem that the only restraint imposed by the law which we are capacitated to act upon is the injury to property sustained by the
petitioners, an injury that would warrant the application of the most deferential standard – the rational basis test. Yet as earlier stated,
we recognize the capacity of the petitioners to invoke as well the constitutional rights of their patrons – those persons who would be
deprived of availing short time access or wash-up rates to the lodging establishments in question.
Viewed cynically, one might say that the infringed rights of these customers were are trivial since they seem shorn of political
consequence. Concededly, these are not the sort of cherished rights that, when proscribed, would impel the people to tear up their
cedulas. Still, the Bill of Rights does not shelter gravitas alone. Indeed, it is those "trivial" yet fundamental freedoms – which the people
reflexively exercise any day without the impairing awareness of their constitutional consequence – that accurately reflect the degree of
liberty enjoyed by the people. Liberty, as integrally incorporated as a fundamental right in the Constitution, is not a Ten Commandments-
style enumeration of what may or what may not be done; but rather an atmosphere of freedom where the people do not feel labored
under a Big Brother presence as they interact with each other, their society and nature, in a manner innately understood by them as
inherent, without doing harm or injury to others.
D.
The rights at stake herein fall within the same fundamental rights to liberty which we upheld in City of Manila v. Hon. Laguio, Jr. We
expounded on that most primordial of rights, thus:
Liberty as guaranteed by the Constitution was defined by Justice Malcolm to include "the right to exist and the right to be free from
arbitrary restraint or servitude. The term cannot be dwarfed into mere freedom from physical restraint of the person of the citizen, but is
deemed to embrace the right of man to enjoy the facilities with which he has been endowed by his Creator, subject only to such restraint
as are necessary for the common welfare."[65] In accordance with this case, the rights of the citizen to be free to use his faculties in all
lawful ways; to live and work where he will; to earn his livelihood by any lawful calling; and to pursue any avocation are all deemed
embraced in the concept of liberty.[66]
The U.S. Supreme Court in the case of Roth v. Board of Regents, sought to clarify the meaning of "liberty." It said:
While the Court has not attempted to define with exactness the liberty . . . guaranteed [by the Fifth and Fourteenth Amendments], the
term denotes not merely freedom from bodily restraint but also the right of the individual to contract, to engage in any of the common
occupations of life, to acquire useful knowledge, to marry, establish a home and bring up children, to worship God according to the
dictates of his own conscience, and generally to enjoy those privileges long recognized . . . as essential to the orderly pursuit of happiness
by free men. In a Constitution for a free people, there can be no doubt that the meaning of "liberty" must be broad indeed. 67 [Citations
omitted]
It cannot be denied that the primary animus behind the ordinance is the curtailment of sexual behavior. The City asserts before this Court
that the subject establishments "have gained notoriety as venue of ‘prostitution, adultery and fornications’ in Manila since they ‘provide
the necessary atmosphere for clandestine entry, presence and exit and thus became the ‘ideal haven for prostitutes and thrill-
seekers.’"68 Whether or not this depiction of a mise-en-scene of vice is accurate, it cannot be denied that legitimate sexual behavior
among willing married or consenting single adults which is constitutionally protected69 will be curtailed as well, as it was in the City of
Manila case. Our holding therein retains significance for our purposes:
The concept of liberty compels respect for the individual whose claim to privacy and interference demands respect. As the case of Morfe
v. Mutuc, borrowing the words of Laski, so very aptly stated:
Man is one among many, obstinately refusing reduction to unity. His separateness, his isolation, are indefeasible; indeed, they are so
fundamental that they are the basis on which his civic obligations are built. He cannot abandon the consequences of his isolation, which
are, broadly speaking, that his experience is private, and the will built out of that experience personal to himself. If he surrenders his will
to others, he surrenders himself. If his will is set by the will of others, he ceases to be a master of himself. I cannot believe that a man no
longer a master of himself is in any real sense free.
Indeed, the right to privacy as a constitutional right was recognized in Morfe, the invasion of which should be justified by a compelling
state interest. Morfe accorded recognition to the right to privacy independently of its identification with liberty; in itself it is fully
deserving of constitutional protection. Governmental powers should stop short of certain intrusions into the personal life of the citizen.70
We cannot discount other legitimate activities which the Ordinance would proscribe or impair. There are very legitimate uses for a wash
rate or renting the room out for more than twice a day. Entire families are known to choose pass the time in a motel or hotel whilst the
power is momentarily out in their homes. In transit passengers who wish to wash up and rest between trips have a legitimate purpose for
abbreviated stays in motels or hotels. Indeed any person or groups of persons in need of comfortable private spaces for a span of a few
hours with purposes other than having sex or using illegal drugs can legitimately look to staying in a motel or hotel as a convenient
alternative.
E.
That the Ordinance prevents the lawful uses of a wash rate depriving patrons of a product and the petitioners of lucrative business ties in
with another constitutional requisite for the legitimacy of the Ordinance as a police power measure. It must appear that the interests of
the public generally, as distinguished from those of a particular class, require an interference with private rights and the means must be
reasonably necessary for the accomplishment of the purpose and not unduly oppressive of private rights.71 It must also be evident that no
other alternative for the accomplishment of the purpose less intrusive of private rights can work. More importantly, a reasonable relation
must exist between the purposes of the measure and the means employed for its accomplishment, for even under the guise of protecting
the public interest, personal rights and those pertaining to private property will not be permitted to be arbitrarily invaded.72
Lacking a concurrence of these requisites, the police measure shall be struck down as an arbitrary intrusion into private rights. As held in
Morfe v. Mutuc, the exercise of police power is subject to judicial review when life, liberty or property is affected.73 However, this is not in
any way meant to take it away from the vastness of State police power whose exercise enjoys the presumption of validity.74
Similar to the Comelec resolution requiring newspapers to donate advertising space to candidates, this Ordinance is a blunt and heavy
instrument.75 The Ordinance makes no distinction between places frequented by patrons engaged in illicit activities and patrons engaged
in legitimate actions. Thus it prevents legitimate use of places where illicit activities are rare or even unheard of. A plain reading of section
3 of the Ordinance shows it makes no classification of places of lodging, thus deems them all susceptible to illicit patronage and subject
them without exception to the unjustified prohibition.
The Court has professed its deep sentiment and tenderness of the Ermita-Malate area, its longtime home,76 and it is skeptical of those
who wish to depict our capital city – the Pearl of the Orient – as a modern-day Sodom or Gomorrah for the Third World set. Those still
steeped in Nick Joaquin-dreams of the grandeur of Old Manila will have to accept that Manila like all evolving big cities, will have its
problems. Urban decay is a fact of mega cities such as Manila, and vice is a common problem confronted by the modern metropolis
wherever in the world. The solution to such perceived decay is not to prevent legitimate businesses from offering a legitimate product.
Rather, cities revive themselves by offering incentives for new businesses to sprout up thus attracting the dynamism of individuals that
would bring a new grandeur to Manila.
The behavior which the Ordinance seeks to curtail is in fact already prohibited and could in fact be diminished simply by applying existing
laws. Less intrusive measures such as curbing the proliferation of prostitutes and drug dealers through active police work would be more
effective in easing the situation. So would the strict enforcement of existing laws and regulations penalizing prostitution and drug use.
These measures would have minimal intrusion on the businesses of the petitioners and other legitimate merchants. Further, it is apparent
that the Ordinance can easily be circumvented by merely paying the whole day rate without any hindrance to those engaged in illicit
activities. Moreover, drug dealers and prostitutes can in fact collect "wash rates" from their clientele by charging their customers a
portion of the rent for motel rooms and even apartments.
IV.
We reiterate that individual rights may be adversely affected only to the extent that may fairly be required by the legitimate demands of
public interest or public welfare. The State is a leviathan that must be restrained from needlessly intruding into the lives of its citizens.
However well-intentioned the Ordinance may be, it is in effect an arbitrary and whimsical intrusion into the rights of the establishments as
well as their patrons. The Ordinance needlessly restrains the operation of the businesses of the petitioners as well as restricting the rights
of their patrons without sufficient justification. The Ordinance rashly equates wash rates and renting out a room more than twice a day
with immorality without accommodating innocuous intentions.
The promotion of public welfare and a sense of morality among citizens deserves the full endorsement of the judiciary provided that such
measures do not trample rights this Court is sworn to protect.77 The notion that the promotion of public morality is a function of the State
is as old as Aristotle.78 The advancement of moral relativism as a school of philosophy does not de-legitimize the role of morality in law,
even if it may foster wider debate on which particular behavior to penalize. It is conceivable that a society with relatively little shared
morality among its citizens could be functional so long as the pursuit of sharply variant moral perspectives yields an adequate
accommodation of different interests.79
To be candid about it, the oft-quoted American maxim that "you cannot legislate morality" is ultimately illegitimate as a matter of law,
since as explained by Calabresi, that phrase is more accurately interpreted as meaning that efforts to legislate morality will fail if they are
widely at variance with public attitudes about right and wrong.80 Our penal laws, for one, are founded on age-old moral traditions, and as
long as there are widely accepted distinctions between right and wrong, they will remain so oriented.
Yet the continuing progression of the human story has seen not only the acceptance of the right-wrong distinction, but also the advent of
fundamental liberties as the key to the enjoyment of life to the fullest. Our democracy is distinguished from non-free societies not with
any more extensive elaboration on our part of what is moral and immoral, but from our recognition that the individual liberty to make the
choices in our lives is innate, and protected by the State. Independent and fair-minded judges themselves are under a moral duty to
uphold the Constitution as the embodiment of the rule of law, by reason of their expression of consent to do so when they take the oath
of office, and because they are entrusted by the people to uphold the law.81
Even as the implementation of moral norms remains an indispensable complement to governance, that prerogative is hardly absolute,
especially in the face of the norms of due process of liberty. And while the tension may often be left to the courts to relieve, it is possible
for the government to avoid the constitutional conflict by employing more judicious, less drastic means to promote morality.
WHEREFORE, the Petition is GRANTED. The Decision of the Court of Appeals is REVERSED, and the Decision of the Regional Trial Court of
Manila, Branch 9, is REINSTATED. Ordinance No. 7774 is hereby declared UNCONSTITUTIONAL. No pronouncement as to costs.
SO ORDERED.
DANTE O. TINGA
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice