UNIVERSITY OF THE EAST

COLLEGE OF LAW

JUDGE GENER GITO

REMEDIAL LAW REVIEW 1

LEONEN CASE DIGESTS

CLASS COMPILATION

SECTION:
1V-B-1
FIRST SEMESTER, S.Y. 2019-2020

Abong II, Mario U. Maceren, Michael Gerard D.

Adame, Dakila B. Madarang, Querllon P.
Agdeppa, Princess Madrilejos, Jhonna Faye R.
Agustin, Nikka Carmela J. Magdaraog, James B.
Amoyo, Jodi Anne Maguddatu, John Paul S.
Batulan, Kervin B. Maling, Zoraida Ryza O.
Bonsol, Antoinette E. Mendoza, Amor Mea Therese M.
Cabanit, Joseph A. Navarro, Christine E.
Cabauatan, Karl Patrick G. Nilo, Jhon N.
Cregencia, Graciella Merill O. Nombre, Noreen Patricia V.
Del Campo, Charlene J. Nonan, Kim Erica T.
Del Rosario-Lao, Alexis Ira D. Ong, Caroline O.
Esmail, Jarica B. Ong, Xyrus Stevenson R.
Garcia, Patricia Dianne S. Prudente, Maica A.
Labayog, Neri Danessa B. Quimpo Jr., Salvador D.
Leuterio, Mary Ann C. Ramirez, Shayne B.
Longboan, Justin Marc Francis A. Ursabia, Angelo Francis G.
Macabeo, Kate Emlac F.

1
 RE: NOMINATION OF ATTY. LYNDA CHAGUILE, IBP IFUGAO
PRESIDENT, AS REPLACEMENT FOR IBP GOVERNOR FOR
NORTHERN LUZON, DENIS B. HABAWEL

A.M. No. 13-04-03-SC

December 10, 2013

J. Leonen

DOCTRINE:
The Court is not empowered to decide moot questions or abstract propositions, or
to declare principles or rules of law which cannot affect the result as to the thing
in issue in the case before it. In other words, when a case is moot, it becomes non-
justiciable.

FACTS:
Atty. Marlou B. Ubano, IBP Governor for Western Visayas sought to
invalidate the Resolution of the IBP Board of Governors which approved
the nomination of Atty. Lynda Chaguile as the replacement of IBP
Governor for Northern Luzon, Denis B. Habawel. He noted that on the
IBP By-Laws which considers as ipso facto resigned from his or her post
any official of the IBP who files a Certificate of Candidacy for any elective
public office. Under the amended By-Laws, the resignation takes effect on
the starting date of the official campaign period.
Atty. Ubano alleged that the IBP Governor for Northern Luzon, Denis B.
Habawel, filed a Certificate of Candidacy to run for the position of
Provincial Governor of the Province of Ifugao. Hence, he is considered
ipso facto resigned from the IBP.

Atty. Ubano challenged the IBP Board of Governors' approval of Atty.

Chaguiles succession as IBP Governor for Northern Luzon on two
grounds: First, there was, as yet, no vacancy. Atty. Habawel was himself
present at the meeting where his replacement was named. There was,

2
therefore, no need to name a replacement. Second, the right to elect the
successor of a resigned IBP Governor is vested, not in the IBP Board of
Governors, but in the delegates of the concerned region; thus, the IBP
Board of Governors approval of the nominee to succeed Atty. Habawel is
ultra vires.

ISSUE:
Whether or not the Court is empowered to decide moot questions or
declare principles or rules of law which cannot affect the result as to the
thing in issue in the case before it

RULING:
Yes. As a rule, this Court may only adjudicate actual, ongoing
controversies. The Court is not empowered to decide moot questions or
abstract propositions, or to declare principles or rules of law which cannot
affect the result as to the thing in issue in the case before it. In other
words, when a case is moot, it becomes non-justiciable.
An action is considered "moot" when it no longer presents a justiciable
controversy because the issues involved have become academic or dead
or when the matter in dispute has already been resolved and hence, one is
not entitled to judicial intervention unless the issue is likely to be raised
again between the parties. There is nothing for the court to resolve as the
determination thereof has been overtaken by subsequent events.
However, we recognize that the validity of Atty. Chaguile’s appointment
as Governor for Northern Luzon affects the validity of her actions as the
occupant of this office, especially her participation in the IBP Board of
Governors’ election of the IBP EVP, which is the subject of the second
Administrative Matter.
Indeed, it is not only erroneous but also absurd to insist that a vacancy
must actually and literally exist at the precise moment that a successor to
an office is identified. Where a vacancy is anticipated with reasonable
certainty—as when a term is ending or the effectivity of a resignation or a

3
retirement is forthcoming—it is but reasonable that those who are in a
position to designate a replacement act promptly. New officials are
elected before the end of an incumbent’s term; replacements are recruited
(and even trained) ahead of an anticipated resignation or retirement. This
is necessary to ensure the smooth and effective functioning of an office.
Between prompt and lackadaisical action, the former is preferable. It is
immaterial that there is an identified successor-in-waiting so long as there
are no simultaneous occupants of an office.
On the second ground, the third paragraph of Section 44 of the IBP By-
Laws clearly provides that "the delegates from the region shall by
majority, elect a successor from among the members of the Chapter to
which the resigned governor is a member." There is no ambiguity in this
text. We are surprised that the IBP—an institution expected to uphold the
rule of law—has chosen to rely on "tradition" to validate its action. The
IBP Board of Governors arrogated unto itself a power which is vested in
the delegates of the concerned IBP region. This arrogation is a manifest
violation of the clear and unmistakable terms of the IBP’s By-Laws. We
cannot countenance this. No amount of previous practice or "tradition"
can validate such a patently erroneous action. It is, therefore, clear that
Atty. Chaguile’s designation as IBP Governor for Northern Luzon is
tainted with irregularity, and therefore, invalid.

4
REPUBLIC OF THE PHILIPPINES, REPRESENTED BY ABUSAMA M.
ALID, OFFICER-IN-CHARGE, DEPARTMENT OF AGRICULTURE-
REGIONAL-FIELD UNIT XII (DA-RFU
XII), Petitioner, v. ABDULWAHAB A. BAYAO, OSMEÑA I.
MONTAÑER, RAKMA B. BUISAN, HELEN M. ALVARES, NEILA P.
LIMBA, ELIZABETH B. PUSTA, ANNA MAE A.. SIDENO, UDTOG B.
TABONG, JOHN S. KAMENZA, DELIA R. SUBALDO, DAYANG W.
MACMOD, FLORENCE S. TAYUAN, IN THEIR OWN BEHALF AND
IN BEHALF OF THE OTHER OFFICIALS AND EMPLOYEES OF DA-
RFU XII, Respondents.

GR No. 179492

Jun 05, 2013

J. Leonen

DOCTRINE:
The settled rule is that a Motion for Reconsideration is a condition sine qua non
for the filing of a Petition for Certiorari. Its purpose is to grant an opportunity for
the court to correct any actual or perceived error attributed to it by re-
examination of the legal and factual circumstances of the case.

FACTS:
Petitioner Department of Agriculture Regional Field Unit XII (DA-
RFU XII) is a government office mandated to implement the laws,
policies, plans, programs, rules, and regulations of the Department of
Agriculture in its regional area, while respondents are officials and
employees of DA-RFU XII.[1]

On March 30, 2004, Executive Order (E.O.) No. 304 was passed
designating Koronadal City as the regional center and seat of
SOCCSKSARGEN Region.[2] It provides that all departments, bureaus,
and offices of the national government in the SOCCSKSARGEN Region
shall transfer their regional seat of operations to Koronadal City.[3]

5
In an April 1, 2005 Memorandum, the Department of Agriculture (DA)
Undersecretary for Operations Edmund J. Sana directed Officer-in-
Charge (OIC) and Regional Executive Director of DA-RFU XII Abusama
M. Alid as follows:

In compliance with Executive Order No. 304 of which Section 2 states

"Transfer of Regional Offices. All departments, bureaus and offices of the
National Government on the SOCCSKSARGEN Region shall transfer
their regional seat of operations to Koronadal City," you are hereby
directed to immediately effect the transfer of the administrative, finance
and operations base of RFU XII from Cotabato City to Koronadal City. On
the interim, part of the staff can temporarily hold office at either or both
the ATI building in Tantangan and Tupi Seed Farm, but the main office
shall be within Koronadal City.

The action plan for transfer should be submitted to my office not later
than 6 April 2005 so that appropriate funding can be processed soonest.
Further, execution of the plan should commence by 16 April 2005 or
earlier so that concerned personnel can benefit from the summer break to
make personal arrangements for the transfer of their work base.

For strict compliance.[4]

In a Memorandum dated April 22, 2005 addressed to DA Secretary

Arthur Yap, private respondents opposed the implementation of the April
1, 2005 Memorandum.[5]

They alleged that in 2004, former President Gloria Macapagal-Arroyo

made a pronouncement during one of her visits in Cotabato City that the
regional seat of Region 12 shall remain in Cotabato City.[6] Only three
departments were not covered by the suspension of E.O. No. 304, namely,
the Department of Trade and Industry (DTI), Department of Tourism
(DOT), and Department of Labor and Employment (DOLE).[7]

Respondents alleged further in their Memorandum to the DA Secretary

6
that on March 7, 2005, they appealed to the Secretary of Agriculture that
the implementation of E.O. No. 304 be held in abeyance. A copy of the
Petition was attached to the Memorandum. It cited reasons such as the
huge costs the physical transfer will entail and the plight of employees
who have already settled and established their homes in Cotabato City.[8]

On March 8, 2005, their Petition was endorsed by Department of

Agriculture Employees Association-12 (DAEAS-12) President Osmeña I.
Motañer to then President Macapagal-Arroyo, and on April 12, 2005, this
was referred to DA Secretary Yap for his information and appropriate
action.[9] Respondents justified their appeal saying that a building was
constructed in Cotabato City that can accommodate the whole staff of
DA- RFU XII. On the other hand, there is no building yet in Koronadal
City where rent is very expensive.[10] Moreover, if the regional office
remains in Cotabato City, the government need not spend over
P7,200,000.00 as dislocation pay as well as other expenses for equipment
hauling and construction.[11] Finally, respondents alleged that the
proposed third floor of the ATI Building in Tantangan has a sub-standard
foundation and will not be issued a certificate of occupancy by the City
Engineering Office of Koronadal City as per information from an
auditor.[12]

On May 17, 2005, OIC Abusama M. Alid held a meeting and ordered the
transfer of the regional office to ATI Building in Tantangan and Tupi Seed
Farm in Tupi, both located in South Cotabato and Uptown, Koronadal
City, to be carried out on May 21, 2005.[13]

This prompted respondents to file on May 18, 2005 a Complaint for

Injunction with Prayer for Issuance of Writ of Preliminary Injunction
and/or Temporary Restraining Order with the Regional Trial Court,
Branch 14 of Cotabato City.[14]

By Order dated October 9, 2006, the trial court granted respondents'

Prayer for a Writ of Preliminary Injunction.[15]

In a petition dated December 17, 2006,[16] petitioner went to the Court of

Appeals via Rule 65 on the ground that the assailed Order of the trial

7
court is contrary to the pronouncement of this Court in DENR v. DENR
Region 12 Employees.

Through the March 21, 2007 Resolution, the Court of Appeals dismissed
the Petition for Certiorari for failure of petitioner to resort to a Motion for
Reconsideration of the assailed trial court Order.[17]

Hence, the present Petition under Rule 45.

ISSUE:
Whether or not a Motion for Reconsideration is a condition sine qua non
for the filing of a Petition for Certiorari

HELD:
Yes. The settled rule is that a Motion for Reconsideration is a condition
sine qua non for the filing of a Petition for Certiorari.[36] Its purpose is to
grant an opportunity for the court to correct any actual or perceived error
attributed to it by re-examination of the legal and factual circumstances of
the case.[37]

This rule admits well-defined exceptions as follows:

Concededly, the settled rule is that a motion for reconsideration is a

condition sine qua non for the filing of a petition for certiorari.

Its purpose is to grant an opportunity for the court to correct any actual or
perceived error attributed to it by the re-examination of the legal and
factual circumstances of the case. The rule is, however, circumscribed by
well-defined exceptions, such as (a) where the order is a patent nullity, as
where the court a quo has no jurisdiction; (b) where the questions raised
in the certiorari proceedings have been duly raised and passed upon by
the lower court, or are the same as those raised and passed upon in the
lower court; (c) where there is an urgent necessity for the resolution of the
question and any further delay would prejudice the interests of the
Government or of the petitioner or the subject matter of the action is

8
perishable; (d) where, under the circumstances, a motion for
reconsideration would be useless; (e) where petitioner was deprived of
due process and there is extreme urgency for relief; (f) where, in a
criminal case, relief from an order of arrest is urgent and the granting of
such relief by the trial court is improbable; (g) where the proceedings in
the lower court are a nullity for lack of due process; (h) where the
proceeding were ex parte or in which the petitioner had no opportunity to
object; and (i) where the issue raised is one purely of law or where public
interest is involved.[38] (Emphasis provided)

The second exception is present in this case.

9
JADEWELL PARKING SYSTEMS CORPORATION represented by its
manager and authorized representative Norma Tan, Petitioner,
vs.
HON. JUDGE NELSON F. LIDUA SR., Presiding Judge of The
Municipal Trial Court Branch 3, Baguio City, BENEDICTO
BALAJADIA, EDWIN ANG, "JOHN DOES" and "PETER
DOES" Respondents.

G.R. No. 169588

October 7, 2013

J. Leonen

DOCTRINE:
The parameters of prescription: In resolving the issue of prescription of the
offense charged, the following should be considered: (1) the period of prescription
for the offense charged; (2) the time the period of prescription starts to run; and
(3) the time the prescriptive period was interrupted.

FACTS:
Petitioner Jadewell Parking Systems Corporation is a private
parking operator duly authorized to operate and manage the parking
spaces in Baguio City pursuant to City Ordinance 003-2000. It is also
authorized under Section 13 of the City Ordinance to render any motor
vehicle immobile by placing its wheels in a clamp if the vehicle is illegally
parked.

Jadewell Parking Systems Corporation (Jadewell), thru its General

Manager Norma Tan and Jadewell personnel Januario S. Ulpindo and
Renato B. Dulay alleged in their affidavit-complaint that on May 17, 2003,
the respondents Edwin Ang, Benedicto Balajadia and John Doe
dismantled, took and carried away the clamp attached to the left front
wheel of a Mitsubishi Adventure with Plate No. WRK 624 owned by
Edwin Ang. Accordingly, the car was then illegally parked and
unattended at a Loading and Unloading Zone. The value of the clamp
belonging to Jadewell which was allegedly forcibly removed with a piece

10
of metal is P26,250.00. The fines of P500.00 for illegal parking and the
declamping fee of P500.00 were also not paid by the respondents herein.

Jadewell filed two cases against respondents for Robbery it was filed with
the Office of the City Prosecutor of Baguio City on May 23, 2003. A
preliminary investigation took place on May 28, 2003. Respondent
Benedicto Balajadia likewise filed a case charging Jadewell president,
Rogelio Tan, and four (4) of Jadewell's employees with Usurpation of
Authority/Grave Coercion.

On October 2, 2003, two criminal Informations were filed with the

Municipal Trial Court of Baguio City dated July 25, 2003.

Respondent Benedicto Balajadia and the other accused through their

counsel Paterno Aquino filed on January 20, 2004 a Motion to Quash
and/or Manifestation[8] on February 2, 2004.

In an Order[10] dated February 10, 2004, respondent Judge Nelson F.

Lidua, Sr., Presiding Judge of the Municipal Trial Court of Baguio City,
Branch 3, granted the accused's Motion to Quash and dismissed the cases.
Petitioner filed a Motion for Reconsideration on February 27, 2004
responding to the February 10, 2004 Order.

Respondents argued that in Zaldivia v. Reyes held that the proceedings

mentioned in Section 2 of Act No. 3326, as amended, refer to judicial
proceedings. Thus, this Court, in Zaldivia, held that the filing of the
Complaint with the Office of the Provincial Prosecutor was not a judicial
proceeding. The prescriptive period commenced from the alleged date of
the commission of the crime on May 7, 2003 and ended two months after
on July 7, 2003. Since the Informations were filed with the Municipal Trial
Court on October 2, 2003, the respondent judge did not abuse its
discretion in dismissing the cases.

The RTC of Baguio City, Branch 7 favored the respondents. In a Decision

dated April 20, 2005, the RTC of Baguio City Branch 7, through Judge
Clarence F. Villanueva, dismissed the Petition for Certiorari.

11
Petitioners then filed a May 17, 2005 Motion for Reconsideration which
was denied by the Regional Trial Court in an August 15, 2005 Order.

ISSUE:
What are the parameters of prescription?

RULING:
The resolution of this case requires an examination of both the substantive
law and the procedural rules governing the prosecution of the offense.
With regard to the prescription period, Act No. 3326, as amended, is the
only statute that provides for any prescriptive period for the violation of
special laws and municipal ordinances. No other special law provides any
other prescriptive period, and the law does not provide any other
distinction. Petitioner may not argue that Act No. 3326 as amended does
not apply.

In Romualdez v. Hon. Marcelo, this Court defined the parameters of

prescription: In resolving the issue of prescription of the offense charged,
the following should be considered: (1) the period of prescription for the
offense charged; (2) the time the period of prescription starts to run; and
(3) the time the prescriptive period was interrupted.

With regard to the period of prescription, it is now without question that

it is two months for the offense charged under City Ordinance 003-2000.

The offense was committed on May 7, 2003 and was discovered by the
attendants of the petitioner on the same day. These actions effectively
commenced the running of the prescription period.

As provided in the Revised Rules on Summary Procedure, only the filing

of an Information tolls the prescriptive period where the crime charged is
involved in an ordinance. The respondent judge was correct when he
applied the rule in Zaldivia v. Reyes. In Zaldivia v. Reyes, the violation of
a municipal ordinance in Rodriguez, Rizal also featured similar facts and
issues with the present case. In that case, the offense was committed on
May 11, 1990. The Complaint was received on May 30, 1990, and the

12
Information was filed with the Metropolitan Trial Court of Rodriguez on
October 2, 1990.

Under Section 9 of the Rules on Summary Procedure, "the complaint or

information shall be filed directly in court without need of a prior
preliminary examination or preliminary investigation." Both parties agree
that this provision does not prevent the prosecutor from conducting a
preliminary investigation if he wants to. However, the case shall be
deemed commenced only when it is filed in court, whether or not the
prosecution decides to conduct a preliminary investigation. This means
that the running of the prescriptive period shall be halted on the date the
case is actually filed in court and not on any date before that.

Jurisprudence exists showing that when the Complaint is filed with the
Office of the Prosecutor who then files the Information in court, this
already has the effect of tolling the prescription period.

Unfortunately, when the Office of the Prosecutor filed the Informations

on October 5, 2003, the period had already prescribed. Thus, respondent
Judge Nestor Lidua, Sr. did not err when he ordered the dismissal of the
case against respondents. According to the Department of Justice
National Prosecutors Service Manual for Prosecutors, an Information is
defined under Part I, Section 5 as: SEC. 5. Information. - An information is
the accusation in writing charging a person with an offense, subscribed by
the prosecutor, and filed with the court. The information need not be
placed under oath by the prosecutor signing the same

13
 ALLIANCE FOR RURAL AND AGRARIAN RECONSTRUCTION,
INC., ALSO KNOWN AS ARARO PARTY-LIST, Petitioner,
vs.
COMMISSION ON ELECTIONS, Respondent.

G.R. No. 192803

December 10, 2013

J. Leonen

DOCTRINE:
A moot and academic case is one that ceases to present a justiciable controversy
by virtue of supervening events, so that a declaration thereon would be of no
practical value. As a rule, courts decline jurisdiction over such case, or dismiss it
on ground of mootness.

FACTS:
The COMELEC En Banc sitting as the National Board of Canvassers
in the May 10, 2010 elections initially proclaimed (28) party-list
organizations as winners involving a total of (35) seats guaranteed and
additional seats. Petitioner, Alliance for Rural and Agrarian
Reconstruction, Inc., (ARARO) was a duly accredited party-list under
Republic Act No. 7941 ranked fiftieth (50th).

Petitioner then filed an election protest before the House of

Representatives Electoral Tribunal (HRET) questioning the Resolution of
the COMELEC that proclaimed the 28 party-list groups.

Petitioner asks that this Court to modify the COMELEC's interpretation of

the formula stated in BANAT v. COMELEC by making the divisor for the
computation of the percentage votes, from total number of votes cast
minus the votes for the disqualified party-list candidates, to the total
number of votes cast regardless whether party-list groups are
disqualified; and enjoin the public COMELEC from proclaiming the
remaining winning party-list candidates until it modifies the
interpretation of the formula used in BANAT v. COMELEC to the
formula proposed by the petitioner.

14
The Court did not issue any TRO, the National Board of Canvassers
proclaimed the winning party-list groups.

The petitioner suggests that the formula used by the COMELEC is flawed
because votes that were spoiled or that were not made for any party-lists
were not counted.

The National Board of Canvassers Resolution No. 10-009 applies the

formula used in BANAT v. COMELEC, G.R. No. 179271 and G.R. No.
179295, April 21, 2009to arrive at the winning party-list groups and their
guaranteed seats, where:

Number of votes of party-list over Proportion or Percentage of votes

garnered by party-list equals the Total number of votes for party-list
candidates

The Proportion or Percentage of votes garnered by party-list should be

greater than or equal to 2% or 0.02 to entitle a party-list candidate to one
(1) seat in the first round. There will be a second round if the total number
of guaranteed seats awarded in the first round is less than the total
number of party-list seats available. Thus:

Total number of party-list seats available - Number of seats allocated in

first round x Proportion or Percentage of votes garnered by party-list =
Additional seats awarded

If the total seats available for party-lists are not yet awarded after the
second round (this is computed by getting the sum of the seats awarded
in the first round and the additional seats awarded in the second round),
the next in the party-list ranking will be given one (1) seat each until all
seats are fully distributed. A three-seat cap per party-list, however, is
imposed on winning groups. Fractional seats are not rounded off and are
disregarded.

The petitioner argues that the Commission on Elections interpretation of

the formula used in BANAT v. COMELEC is flawed because it is not in

15
accordance with the law.The petitioner distinguishes the phrases,valid
votes cast for party-list candidates on the one hand as against votes cast
for the party-list system on the other.

The petitioner argues that the correct interpretation of the provisions of

Republic Act No. 7941 or the Party-list Law does not distinguish between
valid and invalid votes.

The COMELEC argues that this will contradict CIBAC v. COMELEC, 549
Phil. 767 (2007) and BANAT v. COMELEC, G.R. No. 179271 and G.R. No.
179295, April 21, 2009. It asserts that neither can the phrase be construed
to include the number of voters who did not even vote for any qualified
party-list candidate, as these voters cannot be considered to have cast any
vote "for the party-list system."

ISSUE:
Whether or not the petition is moot and academic

RULING:
Yes. The petition is moot and academic.
A moot and academic case is one that ceases to present a justiciable
controversy by virtue of supervening events, so that a declaration thereon
would be of no practical value. As a rule, courts decline jurisdiction over
such case, or dismiss it on ground of mootness. Mendoza v. Villas, G.R.
No. 187256, February 23, 2011

Several supervening events have already rendered this case moot and
academic. First, the Commission on Elections En Banc already proclaimed
other winning party-list groups.Second, the term of office of the winning
party-list groups in the May 2010 national elections ended on June 30,
2013. Finally, the conduct of the May 13, 2013 elections resulted in a new
set of party-list groups.

We held that the expiration of the challenged term of office renders the
corresponding Petition moot and academic.

16
However, the following exceptions to the rule of declining jurisdiction
over moot and academic cases are allowed: (1) there was a grave violation
of the Constitution; (2) the case involved a situation of exceptional
character and was of paramount public interest; (3) the issues raised
required the formulation of controlling principles to guide the Bench, the
Bar and the public; and (4) the case was capable of repetition yet evading
review. Funa v. Acting Secretary of Justice Agra,G.R. No. 191644,
February 19, 2013

On the importance of the assailed formula, this Court will discuss the
issues raised by the petitioner as these are capable of repetition yet
evading review and for the guidance of the bench, bar, and public.

"A real party in interest is the party who stands to be benefited or injured
by the judgement in the suit, or the party entitled to the avails of the suit."
The party's interest must be direct, substantial, and material.

However despite any new computation, ARAROs proposed divisor of

total votes cast for the party-list system whether valid or invalid still fails
to secure one seat for ARARO. Petitioner does not suffer a direct,
substantial or material injury from the application of the formula
interpreted and used in BANAT in proclaiming the winning party-lists in
the assailed National Board of Canvassers Resolution. The computation
proposed by petitioner ARARO even lowers its chances to meet the 2%
threshold required by law for a guaranteed seat. Its arguments will
neither benefit nor injure the party. Thus, it has no legal standing to raise
the argument in this Court.

POLITICAL LAW formula used for determination of winning party list

candidates

In applying and interpreting the provisions of Section 6 of Republic Act

No. 6646, we said inCayat v. Commission on Elections, G.R. No. 163776.
April 24, 2007that votes cast in favor of a candidate "disqualified with
finality" should be considered stray and not be counted. To be consistent,
the party-list group in the ballot that has been disqualified with finality
and whose final disqualification was made known to the electorate by the

17
Commission on Elections should also not be included in the divisor. This
is to accord weight to the disqualification as well as accord respect to the
inherent right of suffrage of the voters.

Thus, the formula to determine the proportion garnered by the party-list

group would now henceforth be:

Number of votes of party-list over the Total number of valid votes for
party-list candidates equals the Proportion or Percentage of votes
garnered by party-list

The total votes cast for the party-list system include those votes made for
party-list groups indicated in the ballot regardless of the pendency of
their motions for reconsideration or petitions before any tribunal in
relation to their cancellation or disqualification cases. However, votes
made for those party-list groups whose disqualification attained finality
prior to the elections should be excluded if the electorate is notified of the
finality of their disqualification by the Commission on Elections. The
divisor also shall not include invalid votes.

Hence, modifying the formula used in BANAT v. COMELEC. The

refined formula shall apply prospectively to succeeding party-list
elections from the date of the finality of the case.

18
 Alejandro V. Tankeh vs. Development Bank of the Philippines,
Sterling Shipping Lines, Inc., Ruperto V. Tankeh, Vicente Arenas, and
Asset Privatization Trust

G.R. No. 171428

November 11, 2013

J. Leonen

DOCTRINE:
In any case, even if the Petition is one for the special civil action of certiorari, this
Court has the discretion to treat a Rule 65 Petition for Certiorari as a Rule 45
Petition for Review on Certiorari. This is allowed if (1) the Petition is filed within
the reglementary period for filing a Petition for review; (2) when errors of
judgment are averred; and (3) when there is sufficient reason to justify the
relaxation of the rules. When this Court exercises this discretion, there is no need
to comply with the requirements provided for in Rule 65.

FACTS:

Ruperto V. Tankeh is the president of Sterling Shipping Lines, Inc. It

was incorporated to operate ocean-going vessels engaged primarily in
foreign trade. Ruperto V. Tankeh applied for a $3.5 million loan from
public respondent Development Bank of the Philippines for the partial
financing of an ocean-going vessel named the M/V Golden Lilac.
According to petitioner Dr. Alejandro V. Tankeh, Ruperto V. Tankeh
approached him, Ruperto informed petitioner that he was operating a
new shipping line business. Petitioner claimed that respondent, who is
also petitioner’s younger brother, had told him that petitioner would be
given one thousand (1,000) shares to be a director of the business. The
shares were worth ₱1,000,000.00. Respondent corporation Sterling
Shipping Lines, Inc. through respondent Ruperto V. Tankeh executed a
Deed of Assignment in favor of DBP. Petitioner wrote a letter to
respondent Ruperto V. Tankeh saying that he was severing all ties and
terminating his involvement with Sterling Shipping Lines, Inc.

19
He required that its board of directors pass a resolution releasing him
from all liabilities, particularly the loan contract with Development Bank
of the Philippines. In addition, petitioner asked that the private
respondents notify DBP that he had severed his ties with Sterling
Shipping Lines, Inc. Subsequently, the M/V Sterling Ace was sold in
Singapore for $350,000.00 by DBP. When petitioner came to know of the
sale, he wrote respondent DBP to express that the final price was
inadequate, and therefore, the transaction was irregular. At this time,
petitioner was still bound as a debtor because of the promissory note
dated May 12, 1981, which petitioner signed in December of 1981. The
promissory note subsisted despite Sterling Shipping Lines, Inc.’s
assignment of all future earnings of the mortgaged M/V Sterling Ace to
DBP. The loan also continued to bind petitioner despite Sterling Shipping
Lines, Inc.’s cash equity contribution of ₱13,663,200.00 which was used to
cover part of the acquisition cost of the vessel, pre-operating expenses,
and initial working capital.

Petitioner filed several Complaints15 against respondents, praying that the

promissory note be declared null and void and that he be absolved from
any liability from the mortgage of the vessel and the note in question.
RTC found promissory notes null and void. A petition for Review on
Certiorari under Rule 45 was then filed.

ISSUE:
Whether or not Petition for Review on Certiorari under Rule 45 was the
proper appeal

RULING:
The Court addresses the procedural issue raised by respondents.
Collectively, respondents argue that the Petition is actually one of
certiorari under Rule 65 of the Rules of Court and not a Petition for
Review on Certiorari under Rule 45. Thus, petitioner’s failure to show

20
that there was neither appeal nor any other plain, speedy or adequate
remedy merited the dismissal of the Complaint.

Contrary to respondent’s imputation, the remedy contemplated by

petitioner is clearly that of a Rule 45 Petition for Review. In Tagle v.
Equitable PCI Bank, this Court made the distinction between a Rule 45
Petition for Review on Certiorari and a Rule 65 Petition for Certiorari:

Certiorari is a remedy designed for the correction of errors of

jurisdiction, not errors of judgment.1âwphi1 In Pure Foods
Corporation v. NLRC, we explained the simple reason for the rule
in this light: When a court exercises its jurisdiction, an error
committed while so engaged does not deprive it of the jurisdiction
being exercised when the error is committed x x x. Consequently, an
error of judgment that the court may commit in the exercise of its
jurisdiction is not correctable through the original civil action of
certiorari. x x x x

Even if the findings of the court are incorrect, as long as it has

jurisdiction over the case, such correction is normally beyond the
province of certiorari. Where the error is not one of jurisdiction, but
of an error of law or fact a mistake of judgment, appeal is the
remedy.

In this case, what petitioner seeks to rectify may be construed as errors of

judgment of the Court of Appeals. These errors pertain to the petitioner’s
allegation that the appellate court failed to uphold the findings of facts of
the lower court. He does not impute any error with respect to the Court of
Appeals’ exercise of jurisdiction. As such, this Petition is simply a
continuation of the appellate process where a case is elevated from the
trial court of origin, to the Court of Appeals, and to this Court via Rule 45.

Contrary to respondents’ arguments, the allegations of petitioner that the

Court of Appeals "committed grave abuse of discretion" did not ipso facto
render the intended remedy that of certiorari under Rule 65 of the Rules
of Court. In this case, petitioner filed his Petition within the reglementary
period of filing a Petition for Review. His Petition assigns errors of
judgment and appreciation of facts and law on the part of the Court of

21
Appeals. Thus, even if the Petition was designated as one that sought the
remedy of certiorari, this Court may exercise its discretion to treat it as a
Petition for Review in the interest of substantial justice.

22
 Office of the Court Administrator vs. Retired Judge Guillermo R.
Andaya

A.M No. RTJ-09-2181

June 25, 2013

J. Leonen

DOCTRINE:
In order for the Court to acquire jurisdiction over an administrative case, the
complaint must be filed during the incumbency of the respondent.

FACTS:

On January 19, 20, and 21, 2009, a judicial audit was conducted on
the RTC 53, Lucena City, Quezon, then presided by the respondent Judge
Guillermo R. Andaya. In a Memorandum and now Hon. Associate Justice
Jose P. Perez recommended that a fine be imposed on respondent Judge
in the amount of Eighty Thousand Pesos (P80,000.00). The fine, which was
to be deducted from his retirement or terminal leave benefits was
recommended for gross incompetence, inefficiency, negligence, and
dereliction of duty. Meanwhile, another administrative case, arose in
relation to the Certificate of Clearance that the respondent Judge filed in
relation to his application for Compulsory Retirement Benefits. In a
Memorandum, then Court Administrator and now Hon. Associate Justice
Jose P. Perez commended the imposition of a fine, to be deducted from
his retirement/gratuity benefits, in the amount of Fifty Thousand Pesos
(P50,000.00). The recommendation was made upon the finding that the
respondent Judge had failed to decide forty-five (45) cases submitted for
decision beyond the reglementary period of three (3) months as per the
March 2009 Monthly Report of Cases. The Court resolved impose a fine of
Fifty Thousand Pesos (P50,000.00) on the respondent Judge for his failure
to decide forty-five (45) cases submitted for decision, with the amount to
be deducted from his retirement/gratuity benefits.

Respondent prayed for the dismissal of the present case for the sake of
justice tempered by leniency on the following grounds: (a) his serious

23
health problems that affected his work efficiency in the last months of his
service; (b) the penalty in A.M. No. RTJ-09-2208 was imposed without
him being given a chance to explain; and (c) he has served twelve (12)
years as an assistant city prosecutor, three (3) years as a Municipal Trial
Court judge, and nineteen (19) years as a RTC judge. The Court resolved
to approve the release of respondent's retirement benefits subject to the
retention of Fifty Thousand Pesos (P50,000.00) and pending the resolution
of the present case. On January 24, 2012, the Court issued a Resolution19 in
A.M. No. RTJ-09-2208 considering the case as closed and terminated.

ISSUE:
Whether or not respondent judge should be held liable

RULING:
No. The respondent Judge could no longer be made liable for these
infractions.

A comparison of the cases involved in the March 2009 Monthly Report of

Cases, which was used as the basis for the findings in A.M. No. No. RTJ-
09-2208, and the cases involved in the judicial audit report of the present
complaint yields the finding that, indeed, twenty-three (23) criminal cases
and nine (9) civil cases are included in both reports. However, it must be
noted that the March 2009 Monthly Report of Cases only covered forty-
five (45) cases, while there were forty-three (43) criminal cases and forty-
six (46) civil cases that were the subject of the judicial audit report of the
present complaint. This means that despite the overlap, there are still
twenty (20) unresolved criminal cases and thirty-seven (37) unresolved
civil cases for which the respondent Judge might be held accountable for.
The other complaint also does not include the unresolved motions in
twenty-nine (29) criminal cases and fifty-three (53) civil cases, which are
included in the judicial audit report in the present complaint.

A review of the records shows that the judicial audit was conducted on
January 19, 20, and 21, 2009 during the respondent Judge's incumbency.

24
However, the administrative complaint was docketed only on April 29,
2009 after his compulsory retirement on March 27, 2009.

In a similar case, the Court in dismissing the complaint against him, We

ruled that:

In order for the Court to acquire jurisdiction over an administrative

case, the complaint must be filed during the incumbency of the
respondent. Once jurisdiction is acquired, it is not lost by reason of
respondent's cessation from office. In Office of the Court
Administrator v. Judge Hamoy, the Court held that:

Respondent's cessation from office x x x does not warrant the

dismissal of the administrative complaint filed against him while
he was still in the service nor does it render said administrative
case moot and academic. The Court's jurisdiction at the time of the
filing of the administrative complaint is not lost by the mere fact
that the respondent had ceased in office during the pendency of the
case.

In the present case, Judge Grageda's compulsory retirement divested the

OCA of its right to institute a new administrative case against him after
his compulsory retirement. The Court can no longer acquire
administrative jurisdiction over Judge Grageda by filing a new
administrative case against him after he has ceased to be a public official.
The remedy, if necessary, is to file the appropriate civil or criminal case
against Judge Grageda for the alleged transgression.

25
 PRYCE CORPORATION vs. CHINA BANKING CORPORATION

G.R. No. 172302

February 18, 2014

J. Leonen

DOCTRINE:
According to the doctrine of res judicata, "a final judgment or decree on the
merits by a court of competent jurisdiction is conclusive of the rights of the
parties or their privies in all later suits on all points and matters determined in
the former suit.

FACTS:

On July 9, 2004, the petitioner filed for corporate rehabilitation with

the Regional Trial Court of Makati, Branch 138 which was then later on
granted and directed the rehabilitation receiver to evaluate and give
recommendations on petitioner Pryce Corporation’s proposed
rehabilitation plan attached to its petition.

The rehabilitation receiver did not approve this plan and submitted
instead an amended rehabilitation plan, which the rehabilitation court
approved by order dated January 17, 2005. In its disposition, the court
found petitioner "eligible to be placed in a state of corporate
rehabilitation." The disposition likewise identified the assets to be held
and disposed of by petitioner Pryce Corporation and the manner by
which its liabilities shall be paid and liquidated.

However, Respondent China Banking Corporation on appeal with the

Court of Appeals contended that the rehabilitation plan’s approval
impaired the obligations of contracts. It argued that neither the provisions
of Presidential Decree No. 902-A nor the Interim Rules of Procedure on
Corporate Rehabilitation (Interim Rules) empowered commercial courts
"to render without force and effect valid contractual stipulations."
Moreover, the plan’s approval authorizing dacion en pago of petitioner
Pryce Corporation’s properties without respondent China Banking

26
Corporation’s consent not only violated "mutuality of contract and due
process, but [was] also antithetical to the avowed policies of the state to
maintain a competitive financial system.” The CA granted the appeal of
the respondent requiring the RTC to conduct hearing to identify assets to
be disposed of, and determining the manner of liquidation to pay the
liabilities. Not contented with the decision, hence this petition.

ISSUE:
Whether or not the validity of the rehabilitation order is now res judicate
in light of BPI vs. Pryce Corporation docketed as G.R. No. 280316

RULING:

The elements for res judicata to apply are as follows: (a) the former
judgment was final; (b) the court that rendered it had jurisdiction over the
subject matter and the parties; (c) the judgment was based on the merits;
and (d) between the first and the second actions, there was an identity of
parties, subject matters, and causes of action. The elements of res judicata
through bar by prior judgment are present in this case.

In the present case, respondent China Banking Corporation and BPI are
creditors of petitioner Pryce Corporation and are both questioning the
rehabilitation court’s approval of the amended rehabilitation plan. Thus,
there is substantial identity of parties since they are litigating for the same
matter and in the same capacity as creditors of petitioner Pryce
Corporation. There is no question that both cases deal with the subject
matter of petitioner Pryce Corporation’s rehabilitation. The element of
identity of causes of action also exists.

This judgment in BPI v. Pryce Corporation covers necessarily the

rehabilitation court’s September 13, 2004 order giving due course to the
petition. The general rule precluding relitigation of issues extends to
questions implied necessarily in the final judgment. The dispositive
portion of the Court of Appeals’ decision in BPI v. Pryce Corporation,
reversed on reconsideration, only mentioned the January 17, 2005 order of
the rehabilitation court approving the amended rehabilitation plan.
Nevertheless, the affirmation of its validity necessarily included the

27
September 13, 2004 order as this earlier order gave due course to the
petition and directed the rehabilitation receiver to evaluate and give
recommendations on the rehabilitation plan proposed by petitioner.

In res judicata, the primacy given to the first case is related to the
principle of immutability of final judgments essential to an effective and
efficient administration of justice. The reason for this is that litigation
must end and terminate sometime and somewhere, and it is essential to
an effective and efficient administration of justice that, once a judgment
has become final, the winning party be not deprived of the fruits of the
verdict. Courts must guard against any scheme calculated to bring about
that result and must frown upon any attempt to prolong the
controversies. The only exceptions to the general rule are the correction of
clerical errors, the so-called nunc pro tunc entries which cause no
prejudice to any party, void judgments, and whenever circumstances
transpire after the finality of the decision rendering its execution unjust
and inequitable.

28
 Republic of the Philippines, represented by the Department of Public
Works and Highways (DPWH) vs. Ortigas and Company Limited
Partnership,

G.R. No. 171496

March 3, 2014

J. Leonen

DOCTRINE:
Owners whose properties were taken for public use are entitled to just
compensation.

FACTS:

Respondent, Ortigas and Company Limited Partnership, is the

owner of a parcel of land known as Lot 5-B-2 in Pasig City. Upon the
request of the Department of Public Works and Highways, respondent
Ortigas caused the segregation of its property into five lots and reserved
one portion for road widening for the C-5 flyover project. It designated
Lot 5-B-2-A, for the road widening of Ortigas Avenue. Respondent
Ortigas also caused the annotation of the term "road widening" on its title.
The title was then inscribed with an encumbrance that it was for road
widening and subject to Section 50 of Presidential Decree No. 1529 or the
Property Registration Decree. The C-5-Ortigas Avenue flyover was
completed in 1999, utilizing only 396 square meters of the 1,445-square-
meter allotment for the project.

Respondent Ortigas filed with the Regional Trial Court of Pasig a

petition for authority to sell to the government Lot 5-B-2-A-1. Respondent
Ortigas alleged that the Department of Public Works and Highways
requested the conveyance of the property for road widening purposes.
Consequently, RTC issued an order authorizing the sale of Lot 5-B-2-A-1
to petitioner Republic of the Philippines. Upon appeal, the Court of
Appeals dismissed petitioner Republic of the Philippines’ appeal on the

29
ground that an order or judgment denying a motion for reconsideration is
not appealable.

ISSUE:
Whether the Court of Appeals gravely erred in denying petitioner
Republic of the Philippines’ appeal based on technicalities

RULING:

No. Appeals from the Regional Trial Court to the Court of Appeals
under Rule 41 must raise both questions of fact and law.

Section 2 of Rule 50 of the Rules of Court provides that appeals

taken from the Regional Trial Court to the Court of Appeals raising only
pure questions of law are not reviewable by the Court of Appeals. In
which case, the appeal shall not be transferred to the appropriate court.
Instead, it shall be dismissed outright. Appeals from the decisions of the
Regional Trial Court, raising purely questions of law must, in all cases, be
taken to the Supreme Court on a petition for review on certiorari in
accordance with Rule 45. An appeal by notice of appeal from the decision
of the Regional Trial Court in the exercise of its original jurisdiction to the
Court of Appeals is proper if the appellant raises questions of fact or both
questions of fact and questions of law.

The sole issue raised by petitioner Republic of the Philippines to the

Court of Appeals is whether respondent Ortigas’ property should be
conveyed to it only by donation, in accordance with Section 50 of
Presidential Decree No. 1529. This question involves the interpretation
and application of the provision. It does not require the Court of Appeals
to examine the truth or falsity of the facts presented. Neither does it invite
a review of the evidence. The issue raised before the Court of Appeals
was, therefore, a question purely of law. The proper mode of appeal is
through a petition for review under Rule 45. Hence, the Court of Appeals
did not err in dismissing the appeal on this ground.

30
 What Section 1 of Rule 41 prohibits is an appeal taken from an
interlocutory order. An interlocutory order or judgment, unlike a final
order or judgment, does "not completely dispose of the case [because it
leaves to the court] something else to be decided upon." Appeals from
interlocutory orders are generally prohibited to prevent delay in the
administration of justice and to prevent "undue burden upon the courts.”
Orders denying motions for reconsideration are not always interlocutory
orders. A motion for reconsideration may be considered a final decision,
subject to an appeal, if "it puts an end to a particular matter," leaving the
court with nothing else to do but to execute the decision. An appeal from
an order denying a motion for reconsideration of an order of dismissal of
a complaint is effectively an appeal of the order of dismissal itself. It is an
appeal from a final decision or order.

31
Lui Enterprises, Inc. vs. Zuelig Pharma Corporation and the Philippine
Bank of Communications

G.R. No. 193494

March 12, 2014

J. Leonen

DOCTRINE:

There should be no inexplicable delay in the filing of a motion to set aside order of
default. Even when a motion is filed within the required period, excusable
negligence must be properly alleged and proven.

FACTS:

Lui Enterprises, Inc. and Zuellig Pharma Corporation entered into a

10-year contract of lease over a parcel of land located in Barrio Tigatto,
Buhangin, Davao City. The parcel of land was registered under Eli L. Lui.
Zuellig Pharma received a letter from the Philippine Bank of
Communications claiming to be the new owner of the leased property, the
bank asked Zuellig Pharma to pay rent directly to it. Zuellig Pharma
promptly informed Lui Enterprises of the Philippine Bank of
Communications’ claim. Lui Enterprises wrote to Zuellig Pharma and
insisted on its right to collect the leased property’s rent. Zuellig Pharma
filed a complaint for interpleader with RTC Makati. Zuellig Pharma
alleged that it already consigned in court P604,024.35 as rental payments.
On the other hand, Lui Enterprises filed a motion to dismiss on the
ground that Zuellig Pharma’s alleged representative did not have
authority to file the complaint for interpleader on behalf of the
corporation. Under the secretary’s certificate attached to the complaint,
Atty. Ana L.A. Peralta was only authorized to "initiate and represent
[Zuellig Pharma] in the civil proceedings for consignation of rental
payments to be filed against Lui Enterprises, Inc. and/or [the Philippine
Bank of Communications]."

32
According to Lui Enterprises, an earlier filed nullification of deed of
dation in payment case pending with the RTC of Davao barred the filing
of the interpleader case. Lui Enterprises filed this nullification case against
the Philippine Bank of Communications with respect to several properties
it dationed to the bank in payment of its obligations. The property leased
by Zuellig Pharma was among those allegedly dationed to the Philippine
Bank of Communications.

RTC Makati ruled that Lui Enterprises was barred from any claim in
respect of the rental payments since it was declared in default. Thus,
according to the trial court, there was no issue as to which corporation
had the better right over the rental payments. It was only on October 21,
2004, or one year after the issuance of the order of default, that Lui
Enterprises filed a motion to set aside order of default in the Makati trial
court on the ground of excusable negligence. Lui Enterprises argued that
its failure to file a motion to dismiss on time was caused by the negligence
of Lui Enterprises former counsel. This negligence was allegedly
excusable because Lui Enterprises was prejudiced and prevented from
fairly presenting its case.

ISSUE:

Whether the Regional Trial Court of Makati erred in denying Lui

Enterprises’ motion to set aside order of default

RULING:

No. Lui Enterprises failed to show that its failure to answer the
complaint within the required period was due to excusable negligence.
Lui Enterprises had discovered its default before the RTC Makati
rendered judgment. Thus, it timely filed a motion to set aside order of
default, raising the ground of excusable negligence. Excusable negligence
is "one which ordinary diligence and prudence could not have guarded
against." The circumstances should be properly alleged and proved. In

33
this case, we find that Lui Enterprises’ failure to answer within the
required period is inexcusable.

Lui Enterprises’ counsel filed its motion to dismiss four days late. It did
not immediately take steps to remedy its default and took one year from
discovery of default to file a motion to set aside order of default. In its
motion to set aside order of default, Lui Enterprises only conveniently
blamed its counsel for the late filing of the answer without offering any
excuse for the late filing. This is not excusable negligence under Rule 9,
Section 3, paragraph (b) of the 1997 Rules of Civil Procedure.

An interpleader complaint may be filed by a lessee against those who

have conflicting claims over the rent due for the property leased. In this
case, Zuellig Pharma filed the interpleader case to extinguish its
obligation to pay rent. Its purpose in filing the interpleader case "was not
defeated" when the Makati trial court declared Lui Enterprises in default.
At any rate, an adverse claimant in an interpleader case may be declared
in default. The Rules would not have allowed claimants in interpleader
cases to be declared in default if it would"ironically defeat the very
purpose of the suit.

RTC Makati declared Lui Enterprises in default when it failed to answer

the complaint within the required period. Lui Enterprises filed a motion
to set aside order of default without an acceptable excuse why its counsel
failed to answer the complaint. It failed to prove the excusable negligence.
Thus, the Makati trial court did not err in refusing to set aside the order of
default.

34
 VIVENCIO B. VILLAGRACIA, Petitioner, vs. FIFTH (5th) SHARI'A
DISTRICT COURT and ROLDAN E. MALA, represented by his father
Hadji Kalam T. Mala, Respondents.

G.R. No. 188832

April 23, 2014

Leonen, J.

DOCTRINE:
Shari’a District Courts have no jurisdiction over real action where one of the
parties is not a Muslim.

FACTS:
Roldan purchased a 300-square-meter parcel of land located in
Shariff Kabunsuan, from one Ceres. Transfer Certificate of Title covering
the parcel of land was issued in Roldan’s name. Roldan had the parcel of
land surveyed. In a report, the Geodetic Engineer found that Vivencio
occupied the parcel of land covered by Roldan’s certificate of title.
Failing to settle with Vivencio at the barangay level, Roldan filed an
action to recover the possession of the parcel of land with respondent
Fifth Shari’a District Court alleging among others that he is a Filipino
Muslim
Respondent court took cognizance of the case and caused service of
summons on Vivencio. However, despite service of summons, Vivencio
failed to file his answer. Thus, Roldan moved that he be allowed to
present evidence ex parte, which motion respondent Fifth Shari’a District
Court granted. In its decision, respondent Fifth Shari’a District Court
ruled that Roldan, as registered owner, had the better right to possess the
parcel of land. Thereafter, it issued the notice of writ of execution to
Vivencio.
Vivencio filed a petition for relief from judgment with prayer for issuance
of writ of preliminary injunction. He argued that Shari’a District Courts

35
may only hear civil actions and proceedings if both parties are Muslims.
Considering that he is a Christian, Vivencio argued that respondent Fifth
Shari’a District Court had no jurisdiction to take cognizance of Roldan’s
action for recovery of possession of a parcel of land. However, respondent
court denied the petition.

ISSUE:
Does the Shari’a District Court has jusrisdiction over real action where
one of the parties is not a muslim even if it decides the action applying the
provisions of the Civil Code?

RULING:
The Shari’a District Court has NO jurisdiction over real action
where one of the parties is not a Muslim. Jurisdiction over the subject
matter is "the power to hear and determine cases of the general class to
which the proceedings in question belong." This power is conferred by
law, which may either be the Constitution or a statute. Since subject
matter jurisdiction is a matter of law, parties cannot choose, consent to,
or agree as to what court or tribunal should decide theirdisputes. If a
court hears, tries, and decides an action in which it has no jurisdiction, all
its proceedings, including the judgment rendered, are void.
The law conferring the jurisdiction of Shari’a District Courts is the Code
of the Muslim Personal Laws of the Philippines. Under Article 143 of the
Muslim Code, Shari’a District Courts have concurrent original jurisdiction
with "existing civil courts" over real actions not arising
from customary contracts wherein the parties involved are Muslims.
However, this concurrent jurisdiction over real actions "is applicable
solely when both parties are Muslims". When one of the parties is not a
Muslim, the action must be filed before the regular courts.
Considering that Vivencio is not a Muslim, respondent Fifth Shari’a
District Court had no jurisdiction over Roldan’s action for recovery of
possession of real property. The proceedings before it are void, regardless

36
of the fact that it applied the provisions of the Civil Code of the
Philippines in resolving the action.
The application of the provisions of the Civil Code of the Philippines by
respondent Fifth Shari’a District Court does not validate the proceedings
before the court. Under Article 175 of the Muslim
Code, customary contracts are construed in accordance with Muslim law.
Hence, Shari’a District Courts apply Muslim law when resolving real
actions arising from customary contracts.
In real actions not arising from contracts customary to Muslims, there is
no reason for Shari’a District Courts to apply Muslim law. In such real
actions, Shari’a District Courts will necessarily apply the laws of general
application, which in this case is the Civil Code of the Philippines,
regardless of the court taking cognizance of the action.

37
 ALFREDO C. MENDOZA, Petitioner, vs. PEOPLE OF THE
PHILIPPINES AND JUNO CARS, INC., Respondents.

G.R. No. 197293

April 21, 2014

Leonen, J.

DOCTRINE:
The phrase “upon probable cause to be determined personally by the judge after
examination under oath or affirmation of the complainant and the witnesses he
may produce” allows a determination of probable cause by the judge ex parte.

FACTS:
Juno Cars hired Alfredo as Trade-In/Used Car Supervisor. On
November 19, 2007, its Dealer/Operator, Rolando Garcia, conducted a
partial audit of the used cars and discovered that five (5) cars had been
sold and released by Alfredo without Rolando’s or the finance manager’s
permission. The said audit also showed that the buyers of the said cars
made payments but Alfredo failed to remit such payments. Juno Cars
filed a complaint against Alfredo alleging that the latter pilfered an
amount to its prejudice and damage. Alfredo raised Juno Cars’ supposed
failure to prove ownership over the 5 cars or its right to possess them
with the purported unremitted payments. Hence, it could not have
suffered damage.
Prosecutor Rey Delgado issued a resolution finding probable cause
and recommending the filing of the information against Mendoza for
qualified theft and estafa. The RTC then issued an order dismissing the
complaint stating that the evidence adduced does not support a finding of
probable cause for the offense. Juno Cars then filed a petition for certiorari
with the CA, arguing that the determination of probable cause and the
decision whether or not to file a criminal case in court rightfully belongs
to the public prosecutor. The CA then reversed the decision of the RTC
and reinstated the case, ruling that trial court acted without or in excess of

38
its jurisdiction in supplementing the public prosecutor’s finding of
probable cause with her own findings of insufficiency of evidence and
lack pf probable cause.

ISSUE:
May the trial court dismiss an information filed by the prosecutor
on the basis of its own independent finding of lack of probable cause.

RULING:
Yes. While the information filed by Prosecutor Delgado was valid,
Judge Capco-Umali still had the discretion to make her own findings of
whether probable cause existed to order the arrest of Mendoza and
proceed with trial. The executive determination of probable cause
concerns itself with whether there is enough evidence to support an
Information being filed. The judicial determination of probable cause, on
the other hand, determines whether a warrant of arrest should be issued.
The Constitution prohibits the issuance of search warrants or warrant of
arrest where the Judge has not personally determined the existence of
probable cause. The phrase “upon probable cause to be determined
personally by the judge after examination under oath or affirmation of the
complainant and the witnesses he may produce” allows a determination
of probable cause by the judge ex parte. For this reason, Section 6,
paragraph (a) of the Rules 112 of the Rules of Criminal Procedure
mandates the judge to “immediately dismiss the case if the evidence on
record fails to establish probable cause”. Accordingly, with the present
laws and jurisprudence on the matter, Judge Capco-Umali correctly
dismissed the case against Mendoza.

39
 PEOPLE OF THE PHILIPPINES, Plaintiff-appellee, vs. DANILO
FELICIANO, JR., JULIUS VICTOR MEDALLA, CHRISTOPHER
SOLIVA, WARREN L. ZINGAPAN, and ROBERT MICHAEL
BELTRAN ALVIR, Accused-appellants.

G.R. No. 196735

May 5, 2014

LEONEN, J.

DOCTRINE:
Evidence as part of the res gestae may be admissible but have little persuasive
value in this case

FACTS:
On December 8, 1994, at around 12:30 to 1:00 in the afternoon, seven
(7) members of the Sigma Rho fraternity were eating lunch at the Beach
House Canteen, near the Main Library of the University of the
Philippines, Diliman, when they were attacked by several masked men
carrying baseball bats and lead pipes.
On the night of December 8, 1994, the officers of Sigma Rho advised
the victims to lodge their complaints with the National Bureau of
Investigation. Their counsel, Atty. Frank Chavez, told the U.P. Police that
the victims would be giving their statements before the National Bureau
of Investigation, promising to give the U.P. Police copies of their
statements. In the meantime, Venturina was transferred from the U.P.
Infirmary to St. Luke's Hospital on December 8, 1994. He died on
December 10, 1994.
An information for murder was filed against several members of the
Scintilla Juris fraternity and separate information’s were also filed against
them for the attempted and frustrated murder of Sigma Rho fraternity
members.

40
RTC found Alvir, Feliciano Jr., Soliva, Medalla and Zingapan guilty
beyond reasonable doubt of murder and attempted murder. Others were
acquitted. The case against Guerrero was ordered archived by the court
until his apprehension. CA affirmed RTC’s decision.

ISSUE:
Whether or not the RTC and CA correctly ruled, on the basis of the
evidence, that accused-appellants were sufficiently identified.

RULING:
Yes. The Court held that the accused were sufficiently identified by
the witnesses for the prosecution. It was held that the trial court, in
weighing all the evidence on hand, found the testimonies of the witnesses
for the prosecution to be credible. Slight inconsistencies in their
statements were immaterial considering the swiftness of the incident.
Evidence as part of the res gestae may be admissible but have little
persuasive value in this case
According to the testimony of U.P. Police Officer Salvador, when he
arrived at the scene, he interviewed the bystanders who all told him that
they could not recognize the attackers since they were all masked. This, it
is argued, could be evidence that could be given as part of the res gestae.
There is no doubt that a sudden attack on a group peacefully eating lunch
on a school campus is a startling occurrence. Considering that the
statements of the bystanders were made immediately after the startling
occurrence, they are, in fact, admissible as evidence given in res gestae.
The statements made by the bystanders, although admissible, have little
persuasive value since the bystanders could have seen the events
transpiring at different vantage points and at different points in time.
Even Frisco Capilo, one of the bystanders at the time of the attack,
testified that the attackers had their masks on at first, but later on, some
remained masked and some were unmasked.

41
When the bystanders’ testimonies are weighed against those of the
victims who witnessed the entirety of the incident from beginning to end
at close range, the former become merely corroborative of the fact that an
attack occurred. Their account of the incident, therefore, must be given
considerably less weight than that of the victims.
Accused-appellants were correctly charged with murder, and there
was treachery in the commission of the crime
The victims in this case were eating lunch on campus. They were not at a
place where they would be reasonably expected to be on guard for any
sudden attack by rival fraternity men.
The victims, who were unarmed, were also attacked with lead pipes
and baseball bats. The only way they could parry the blows was with
their arms. In a situation where they were unarmed and outnumbered, it
would be impossible for them to fight back against the attackers. The
attack also happened in less than a minute, which would preclude any
possibility of the bystanders being able to help them until after the
incident.
The swiftness and the suddenness of the attack gave no opportunity for
the victims to retaliate or even to defend themselves. Treachery, therefore,
was present in this case.

42
 NESTOR T. GADRINAB, Petitioner, vs. NORAT. SALAMANCA,
ANTONIO TALAO AND ELENA LOPEZ, Respondents.

G.R. No. 194560

June 11, 2014

LEONEN, J.

DOCTRINE:
In a compromise agreement, the parties freely enter into stipulations. "A
judgment based on a compromise agreement is a judgment on the merits" of the
case. It has the effect of res judicata. These principles are impressed both in our
law and jurisprudence.

FACTS:
Respondents, together with Adoracion Gadrinab and Arsenia Talao,
are siblings and heirs of the late Spouses Talao, Nicolas and Aurelia. The
Spouses Talao died intestate, leaving a parcel of land in Sta. Ana,
Manila.The five Talao children divided the property among themselves
through an extrajudicial settlement. Subsequently, Arsenia Talao waived
her share over the property in favor of her siblings.
Respondent Salamanca filed a complaint for partition against her siblings,
Antonio, Elena (deceased, now represented by her husband, Jose Lopez),
and Adoracion (deceased, now represented by heirs, petitioner Nestor
and Francisco Gadrinab) before the Regional Trial Court of Manila. All
parties claimed their respective shares in the property. They also claimed
shares in the rentals collected from one of the units of a duplex apartment
on the property.
Upon being referred to mediation, the parties entered into a compromise
agreement. On April 10, 2003, the Regional Trial Court approved the
compromise agreement. Based on the entry of judgment, the case became
final and executory on April 10, 2003.

43
Nestor Gadrinab filed a motion for execution of the compromise
agreement. He demanded his one-fourth share in the accumulated rentals.
During the hearing on the motion for execution, the parties agreed that
the rentals shall be divided only into three since Nestor had already been
occupying one of the duplex units. The parties also agreed that Antonio
Talao would shoulder Nestor's share, equivalent to one-fourth of the
rental amount.
Because of the attitude of her co-heirs, respondent Salamanca moved for
the physical partition of the property before the Regional Trial Court of
Manila. She prayed for the physical partition of the property instead of
having it sold. Nestor and Francisco Gadrinab opposed the motion. They
contended that the judgment on the compromise agreement had already
become final and executory and had the effect of res judicata. Antonio
Talao and Jose Lopez did not object to the motion for physical partition.
The Regional Trial Court of Manila granted the motion for physical
partition. Nestor and Francisco Gadrinab appealed to the Court of
Appeals. They assailed the grant of Salamanca's motion for physical
partition after the issuance of the judgment on compromise agreement.
The Court of Appeals dismissed the appeal. The Court of Appeals ruled
that the exception to the immutability of judgments, that is, "whenever
circumstances transpire after the finality of the decision rendering its
execution unjust and inequitable," applies in this case.
The Court of Appeals denied petitioner's motion for reconsideration.
Petitioner argued that the Court of Appeals erred in affirming the
Regional Trial Court's order granting respondent Salamanca's motion for
physical partition. A judgment on the compromise agreement had already
been rendered and had attained finality.
In their separate comments, respondents Salamanca and Talao argued
that this case fell under the exception of the rule on immutability of
judgments. The non-compliance of some of the parties with the
compromise agreement constituted an event that "[makes] it difficult if
not totally impossible to enforce the compromise agreement."

44
ISSUE:
Whether the CA erred in affirming the RTC's decision allowing the
physical partition of the property despite finality of a previous judgment
on compromise agreement involving the division of the same property.

RULING:
The petition is meritorious. In a compromise agreement, the parties freely
enter into stipulations. "[A] judgment based on a compromise agreement
is a judgment on the merits" of the case. It has the effect of res judicata.
These principles are impressed both in our law and jurisprudence.
There are two rules that embody the principle of res judicata. The first
rule refers to "bar by prior judgment," which means that actions on the
same claim or cause of action cannot be relitigated. This rule is embodied
in Rule 39, Section 47, paragraph (b) of the Rules of Court, The second
rule refers to "conclusiveness of judgment." This means that facts already
tried and determined in another action involving a different claim or
cause of action cannot anymore be relitigated. This rule is embodied in
Rule 39, Section 47, paragraph (c) of the Rules of Court.
This case involves "bar by prior judgment." Respondents cannot file
another action for partition after final judgment on compromise had
already been rendered in a previous action for partition involving the
same parties and property.
Courts cannot entertain actions involving the same cause of action,
parties, and subject matter without violating the doctrines on bar by prior
judgment and immutability of judgments, unless there is evidence that
the agreement was void, obtained through fraud, mistake or any vice of
consent, or would disrupt substantial justice.
In this case, there was no issue as to the fact that the parties freely entered
into the compromise agreement. There was also no dispute about the
clarity of its terms. Some of the parties simply do not wish to abide by the
compromise agreement's terms.

45
This court does not see how substantial justice will be served by
disturbing a previous final judgment on compromise when failure of its
execution was caused by the parties themselves.
Likewise, respondents' argument that a supervening event, i.e.
disagreement among the parties, was present to justify disturbance of the
final judgment on compromise fails to persuade. A supervening event
may justify the disturbance of a final judgment on compromise if it
"brought about a material change in [the] situation" between the parties.
The material change contemplated must render the execution of the final
judgment unjust and inequitable. Otherwise, a party to the compromise
agreement has a "right to have the compromise agreement executed,
according to its terms."
The subsequent disagreement among the parties did not cause any
material change in the situation or in the relations among the parties. The
situation and relations among the parties remained the same as the
situation and their relations prior to the compromise agreement. They
remained co-owners of the property, which they desired to partition.

46
 LIGHT RAIL TRANSIT AUTHORITY, represented by its
Administrator MELQUIADES A. ROBLES, Petitioner, vs. AURORA A.
SALVAÑA, Respondent.

G.R. No. 192074

June 10, 2014

LEONEN, J.

DOCTRINE:
"The right to appeal is not a natural right or a part of due process; it is merely a
statutory privilege, and may be exercised only in the manner and in accordance
with the provisions of the law."

FACTS:
On May 12, 2006, then Administrator of the Light Rail Transit
Authority, Melquiades Robles, issued Office Order No. 119, series of
2006.[2] The order revoked Atty. Aurora A. Salvaña's designation as
Officer-in-Charge (OIC) of the LRTA Administrative Department. It
"directed her instead to handle special projects and perform such other
duties and functions as may be assigned to her" by the Administrator.
Instead of complying, Salvaña questioned the order with the Office of the
President.
In the interim, Salvaña applied for sick leave of absence on May 12, 2006
and from May 15 to May 31, 2006. In support of her application, she
submitted a medical certificate issued by Dr. Grace Marie Blanco of the
Veterans Memorial Medical Center (VMMC). LRTA discovered that Dr.
Blanco did not issue this medical certificate. Dr. Blanco also denied
having seen or treated Salvaña on May 15, 2006, the date stated on her
medical certificate.
Administrator Robles issued a notice of preliminary investigation. The
notice directed Salvaña to explain in writing within 72 hours from her
receipt of the notice "why no disciplinary action should be taken against

47
her" for not complying with Office Order No. 119 and for submitting a
falsified medical certificate.
Salvaña filed her explanation on June 30, 2006. She alleged that as a
member of the Bids and Awards Committee, she "refused to sign a
resolution" favoring a particular bidder. She alleged that Office Order
No. 119 was issued by Administrator Robles to express his "ire and
vindictiveness" over her refusal to sign.
The LRTA's Fact-finding Committee found her explanation
unsatisfactory. It issued a formal charge against her for Dishonesty,
Falsification of Official Document, Grave Misconduct, Gross
Insubordination, and Conduct Prejudicial to the Best Interest of the
Service.
On August 5, 2006, "Salvaña tendered her irrevocable resignation." None
of the pleadings alleged that this irrevocable resignation was accepted,
although the resolution of the Fact-finding Committee alluded to
Administrator Robles' acceptance of the resignation letter. In the
meantime, the investigation against Salvaña continued.
On October 31, 2006, the Fact-finding Committee issued a resolution
"finding Salvaña guilty of all the charges against her and imposed on her
the penalty of dismissal from service with all the accessory penalties." The
LRTA Board of Directors approved the findings of the Fact-finding
Committee.
Salvaña appealed with the Civil Service Commission. "In her appeal, she
claimed that she was denied due process and that there was no
substantial evidence to support the charges against her.
The Civil Service Commission modified the decision and issued
Resolution No. 071364. The Civil Service Commission found that Salvaña
was guilty only of simple dishonesty. She was meted a penalty of
suspension for three months. LRTA moved for reconsideration of the
resolution. This was denied. The Court of Appeals dismissed the petition
and affirmed the Civil Service Commission's finding. Hence, LRTA filed
this present petition.

48
ISSUE:
Whether the LRTA, as represented by its Administrator, has the standing
to appeal the modification by the Civil Service Commission of its decision

RULING:
We grant the petition. The parties may appeal in administrative cases
involving members of the civil service
It is settled that "the right to appeal is not a natural right or a part of due
process; it is merely a statutory privilege, and may be exercised only in
the manner and in accordance with the provisions of the law." If it is not
granted by the Constitution, it can only be availed of when a statute
provides for it. When made available by law or regulation, however, a
person cannot be deprived of that right to appeal. Otherwise, there will be
a violation of the constitutional requirement of due process of law.
Article IX (B), Section 3 of the Constitution mandates that the Civil Service
Commission shall be "the central personnel agency of the
Government." In line with the constitutionally enshrined policy that a
public office is a public trust, the Commission was tasked with the duty
"to set standards and to enforce the laws and rules governing the
selection, utilization, training, and discipline of civil servants."
Civil servants enjoy security of tenure, and "no officer or employee in the
Civil Service shall be suspended or dismissed except for cause as
provided by law and after due process." Under Section 12, Chapter 3,
Book V of the Administrative Code, it is the Civil Service Commission
that has the power to "hear and decide administrative cases instituted by
or brought before it directly or on appeal."
The grant of the right to appeal in administrative cases is not new. In
Republic Act No. 2260 or the Civil Service Law of 1959, appeals "by the
respondent" were allowed on "the decision of the Commissioner of Civil
Service rendered in an administrative case involving discipline of
subordinate officers and employees."

49
The phrase, "person adversely affected," was not defined in either
Presidential Decree No. 807 or the Administrative Code the LRTA had
standing to appeal the modification by the Civil Service Commission of its
decision. The employer has the right "to select honest and trustworthy
employees." When the government office disciplines an employee based
on causes and procedures allowed by law, it exercises its discretion. This
discretion is inherent in the constitutional principle that "public officers
and employees must, at all times, be accountable to the people, serve
them with utmost responsibility, integrity, loyalty, and efficiency; act with
patriotism and justice, and lead modest lives." This is a principle that can
be invoked by the public as well as the government office employing the
public officer.

50
 JULIET VITUG MADARANG and ROMEO BARTOLOME,
represented by his attorneys-in-fact and acting in their personal
capacities, RODOLFO and RUBY BARTOLOME, Petitioners, vs.
SPOUSES JESUS D. MORALES and CAROLINA N.
MORALES, Respondents.

G.R. No. 199283

June 9, 2014

LEONEN, J.

DOCTRINE:
The double period required under Section 3, Rule 38 is jurisdictional and should
be strictly complied with. A petition for relief from judgment filed beyond the
reglementary period is dismissed outright. This is because a petition for relief
from judgment is an exception to the public policy of immutability of final
judgments.

FACTS:
On January 9, 2001, Spouses Morales filed with the RTC of Quezon
City a complaint for judicial foreclosure of a house and lot located in Bago
Bantay, Quezon City.
The Spouses Morales alleged that on March 23, 1993, Spouses Nicanor
and Luciana Bartolome loaned ₱500,000.00 from them. The Spouses
Bartolome agreed to pay within two months with interest of five percent
(5%) per month. To secure their loan, the Spouses Bartolome mortgaged
the Bago Bantay property to the Spouses Morales.
The period to pay lapsed without the Spouses Bartolome having paid
their loan. After demand, the Spouses Bartolome only paid part of the
loaned amount.
In the meantime, the Spouses Bartolome died. The Spouses Morales, thus,
filed a complaint for judicial foreclosure of the Bago Bantay property

51
against Juliet Vitug Madarang, Romeo Bartolome, and the Spouses
Rodolfo and Ruby Anne Bartolome. The Spouses Morales sued Madarang
as the latter allegedly represented herself as Lita Bartolome and
convinced the Spouses Morales to lend money to the Spouses Bartolome.
Romeo and Rodolfo Bartolome were sued in their capacities as legitimate
heirs of the Spouses Bartolome. Ruby Anne Bartolome is Rodolfo
Bartolome’s wife.
In their answer, defendants assailed the authenticity of the deed of real
estate mortgage covering the Bago Bantay property, specifically, the
Spouses Bartolome’s signatures on the instrument. They added that the
complaint was already barred since it had been dismissed in another
branch of the Regional Trial Court of Quezon City for failure to comply
with an order of the trial court.
The trial court ordered defendants to pay the Spouses Morales within 90
days but not more than 120 days from entry of judgment. Should
defendants fail to pay, the Bago Bantay property shall be sold at public
auction to satisfy the judgment.
Defendants filed their motion for reconsideration of the trial court’s
decision. The trial court denied the motion for reconsideration, its
amendment, and the request for a handwriting expert. Defendants filed a
notice of appeal. The trial court denied due course the notice of appeal for
having been filed out of time. According to the trial court, defendants,
through their counsel, Atty. Arturo F. Tugonon, received a copy of the
order denying the motion for reconsideration on June 24, 2010. This is
evidenced by the registry return receipt on file with the court.
Consequently, they had 15 days to appeal the trial court’s decision.
However, they filed their notice of appeal only on August 11, 2010, which
was beyond the 15-day period to appeal.
Defendants filed a petition for relief from judgment, blaming their 80-
year-old lawyer who failed to file the notice of appeal within the
reglementary period. That Atty. Tugonon’s failure to appeal within the
reglementary period was a mistake and an excusable negligence due to
their former lawyer’s old age.

52
The trial court denied the petition for relief from judgment. The trial court
held that the petition for relief was filed beyond 60 days from the finality
of the trial court’s decision, contrary to Section 3, Rule 38 of the 1997 Rules
of Civil Procedure.
Madarang, Romeo, and Rodolfo and Ruby Anne Bartolome filed the
petition for certiorari with the CA. The appellate court denied outright the
petition for certiorari. The Court of Appeals found that petitioners did not
file a motion for reconsideration of the order denying the petition for
relief from judgment, a prerequisite for filing a petition for certiorari.
Petitioners filed a motion for reconsideration that the CA denied.
Petitioners filed the petition for review on certiorari with this court. They
argue that they need not file a motion for reconsideration of the order
denying their petition for relief from judgment because the questions they
raised in the petition for relief were pure questions of law.

ISSUE:
Whether the petition for relief from judgment was filed out of time.

RULING:
The petition lacks merit. This court agrees that the petition for relief
from judgment was filed out of time. However, the trial court erred in
counting the 60-day period to file a petition for relief from the date of
finality of the trial court’s decision. Rule 38, Section 3 of the 1997 Rules of
Civil Procedure is clear that the 60-day period must be counted after
petitioner learns of the judgment or final order. The period counted from
the finality of judgment or final order is the six-month period. Section 3,
Rule 38 of the 1997 Rules of Civil Procedure states:
Sec. 3. Time for filing petition; contents and verification.– A petition
provided for in either of the preceding sections of this Rule must be
verified, filed within sixty (60) days after petitioner learns of the
judgment, final order, or other proceeding to be set aside, and not more
than six (6) months after such judgment or final order was entered, or

53
such proceeding was taken; and must be accompanied with affidavits,
showing the fraud, accident, mistake or excusable negligence relied upon
and the facts constituting the petitioner’s good and substantial cause of
action or defense, as the case may be.
The double period required under Section 3, Rule 38 is jurisdictional and
should be strictly complied with. A petition for relief from judgment filed
beyond the reglementary period is dismissed outright. This is because a
petition for relief from judgment is an exception to the public policy of
immutability of final judgments.
In this case, petitioners, through counsel, received a copy of the trial
court’s decision on January 29, 2010. They filed a motion for
reconsideration and an amended motion for reconsideration.
Although petitioners filed a motion for reconsideration and amended
motion for reconsideration, these motions were pro forma for not
specifying the findings or conclusions in the decision that were not
supported by the evidence or contrary to law. Their motion for
reconsideration did not toll the 15-day period to appeal.
Petitioners cannot argue that the period to appeal should be counted from
August 11, 2011, the day petitioners personally received a copy of the trial
court’s decision. Notice of judgment on the counsel of record is notice to
the client. Since petitioners’ counsel received a copy of the decision on
January 29, 2010, the period to appeal shall be counted from that date.
Thus, the decision became final 15 days after January 29, 2010, or on
February 13, 2010. Petitioners had six (6) months from February 13, 2010,
or until August 12, 2010, to file a petition for relief from judgment.
Since petitioners filed their petition for relief from judgment on
September 24, 2010, the petition for relief from judgment was filed
beyond six (6) months from finality of judgment. The trial court should
have denied the petition for relief from judgment on this ground.

54
55
 Olivarez Realty Corp. v. Dr. Pablo Castillo

G.R. No. 196251

July 9, 2014

Leonen, J.

DOCTRINE:
Under Rule 35 of the Rules of Court, a trial court may dispense with trial and
proceed to decide a case if from the pleadings, affidavits, depositions, and other
papers on file, there is no genuine issue as to any material fact. In such a case, the
judgment issued is called a summary judgment. A motion for summary
judgment is filed either by the claimant or the defending party. The trial court
then hears the motion for summary judgment. If indeed there are no genuine
issues of material fact, the trial court shall issue summary judgment.

An issue of material fact exists if the answer or responsive pleading filed

specifically denies the material allegations of fact set forth in the complaint or
pleading. If the issue of fact “requires the presentation of evidence, it is a genuine
issue of fact.” However, if the issue “could be resolved judiciously by plain
resort” to the pleadings, affidavits, depositions, and other papers on file, the issue
of fact raised is sham, and the trial court may resolve the action through
summary judgment.

FACTS:
Benjamin Castillo was the registered owner of a parcel of land in
Batangas. The Philippine Tourism Authority allegedly claimed ownership
of the same parcel of land based on a TCT. Castillo and Olivarez Realty,
represented by Dr. Pablo Olivarez, entered into a contract of conditional
sale over the property. Under the deed of conditional sale, Castillo agreed
to sell his property to Olivarez Realty for P19,080,490. Olivarez Realty
agreed to a down payment of P5,000,000, to be paid according to a
schedule.

As to the balance, Olivarez Realty agreed to pay in 30 equal monthly

installments every eighth day of the month beginning in the month that
the parties would receive a decision voiding the PTA’s title to the

56
property. Under the deed of conditional sale, Olivarez Realty shall file the
action against the PTA “with the full assistance of Castillo.”

As to the “legitimate tenants” occupying the property, Olivarez Realty

undertook to pay them “disturbance compensation,” while Castillo
undertook to clear the land of the tenants within six months from the
signing of the deed of conditional sale. Should Castillo fail to clear the
land within six months, Olivarez Realty may suspend its monthly down
payment until the tenants vacate the property. The parties agreed that
Olivarez Realty may immediately occupy the property upon signing of
the deed of conditional sale. Should the contract be cancelled, Olivarez
Realty agreed to return the property’s possession to Castillo and forfeit all
the improvements it may have introduced on the property.

Castillo filed a complaint against Olivarez Realty with RTC Batangas,

alleging that Dr. Olivarez convinced him into selling his property to
Olivarez Realty on the representation that the corporation shall be
responsible in clearing the property of the tenants and in paying them
disturbance compensation.

After the parties had signed the deed of conditional sale, Olivarez Realty
immediately took possession of the property. However, the corporation
only paid P2,500,000. Contrary to the agreement, the corporation did not
file any action against the PTA to void the latter’s title to the property.
The corporation neither cleared the land of the tenants nor paid them
disturbance compensation. Despite demand, Olivarez Realty refused to
fully pay the purchase price. Arguing that Olivarez Realty committed
substantial breach of the contract and that the deed of conditional sale
was a contract of adhesion, Castillo prayed for rescission of contract.

In their defense, defendants alleged that Castillo failed to “fully assist”

the corporation in filing an action against the PTA. Neither did Castillo
clear the property of the tenants within six months from the signing of the
deed of conditional sale. Thus, according to defendants, the corporation
had “all the legal right to withhold the subsequent payments to fully pay
the purchase price.” Castillo filed a motion for summary judgment
and/or judgment on the pleadings. He argued that Olivarez Realty

57
“substantially admitted the material allegations of his complaint,”
specifically:

1. That the corporation failed to fully pay the purchase price for his
property;
2. That the corporation failed to file an action to void the PTA’s title to his
property; and
3. That the corporation failed to clear the property of the tenants and pay
them disturbance compensation.

Should judgment on the pleadings be improper, Castillo argued that

summary judgment may still be rendered as there is no genuine issue as
to any material fact. Olivarez Realty opposed the motion arguing there
had been no favorable decision voiding the title of the PTA.” Considering
that a title adverse to that of Castillo’s existed, Olivarez Realty argued
that the case should proceed to trial and Castillo be required to prove that
his title to the property is “not spurious or fake and that he had not sold
his property to another person.”

The trial court found that Olivarez Realty substantially admitted the
material allegations of Castillo’s complaint and did not raise any genuine
issue [as to any material fact. The corporation was responsible for suing
the PTA and for paying the tenants disturbance compensation. Since
defendant corporation neither filed any case nor paid the tenants
disturbance compensation, the trial court ruled that defendant
corporation had no right to withhold payments from Castillo. The CA
affirmed in toto.

ISSUE:
Did the trial court err in rendering summary judgment for non-existence
of genuine issue?

RULING:
NO. Under Rule 35 of the Rules of Court, a trial court may dispense with
trial and proceed to decide a case if from the pleadings, affidavits,
depositions, and other papers on file, there is no genuine issue as to any
material fact. In such a case, the judgment issued is called a summary

58
judgment. A motion for summary judgment is filed either by the claimant
or the defending party. The trial court then hears the motion for summary
judgment. If indeed there are no genuine issues of material fact, the trial
court shall issue summary judgment.

An issue of material fact exists if the answer or responsive pleading filed

specifically denies the material allegations of fact set forth in the
complaint or pleading. If the issue of fact “requires the presentation of
evidence, it is a genuine issue of fact.” However, if the issue “could be
resolved judiciously by plain resort” to the pleadings, affidavits,
depositions, and other papers on file, the issue of fact raised is sham, and
the trial court may resolve the action through summary judgment.

A summary judgment is usually distinguished from a judgment on the

pleadings. Under Rule 34 of the Rules of Court, trial may likewise be
dispensed with and a case decided through judgment on the pleadings if
the answer filed fails to tender an issue or otherwise admits the material
allegations of the claimant’s pleading. Judgment on the pleadings is
proper when the answer filed fails to tender any issue, or otherwise
admits the material allegations in the complaint. On the other hand, in a
summary judgment, the answer filed tenders issues as specific denials
and affirmative defenses are pleaded, but the issues raised are sham,
fictitious, or otherwise not genuine.

In this case, Olivarez Realty Corporation admitted that it did not fully
pay the purchase price as agreed upon in the deed of conditional sale. As
to why it withheld payments from Castillo, it set up the following
affirmative defenses: first, Castillo did not file a case to void the PTA’s
title to the property; second, Castillo did not clear the land of the tenants;
third, Castillo allegedly sold the property to a third person, and the
subsequent sale is currently being litigated before a Quezon City court.

Considering that Olivarez Realty Corporation’s answer tendered an issue,

Castillo properly availed himself of a motion for summary judgment.
However, the issues tendered by Olivarez Realty’s answer are not
genuine issues of material fact. These are issues that can be resolved
judiciously by plain resort to the pleadings, affidavits, depositions, and

59
other papers on file; otherwise, these issues are sham, fictitious, or
patently unsubstantial.

Petitioner corporation refused to fully pay the purchase price because no

court case was filed to void the PTA’s title on the property. However, the
deed of conditional sale is clear that petitioner Olivarez Realty is
responsible for initiating court action against the PTA. Castillo’s alleged
failure to “fully assist” the corporation in filing the case is not a defense.
As the trial court said, “how can Castillo assist the corporation when the
latter did not file the action in the first place?” Neither can Olivarez Realty
argue that it refused to fully pay the purchase price due to the PTA’s
adverse claim on the property. The corporation knew of this adverse
claim when it entered into a contract of conditional sale. It even obligated
itself to sue the PTA. This defense, therefore, is sham.

60
 City of Dagupan v. Ester Maramba

G.R. No. 174411

July 2, 2014

Leonen, J.

DOCTRINE:
Rule 38 of the Rules of Court allows for the remedy called a petition for relief
from judgment. This is an equitable remedy “allowed in exceptional cases when
there is no other available or adequate remedy” that will allow for substantive
justice. Section 1 of Rule 38 provides for the grounds that warrant the filing of a
petition under Rule 38: Fraud, accident, mistake, or excusable negligence.

Excusable negligence as a ground requires that the negligence be so gross “that

ordinary diligence and prudence could not have guarded against it.” This
excusable negligence must also be imputable to the party-litigant and not to his
or her counsel whose negligence binds his or her client. The binding effect of
counsel’s negligence ensures against the resulting uncertainty and tentativeness
of proceedings if clients were allowed to merely disown their counsels’ conduct.
Nevertheless, this court has relaxed this rule on several occasions such as: “(1)
where the reckless or gross negligence of counsel deprives the client of due process
of law; (2) when the rule’s application will result in outright deprivation of the
client’s liberty or property; or (3) where the interests of justice so require.”
Excusable negligence must be proven.

Fraud as a ground pertains to extrinsic or collateral fraud. There is extrinsic

fraud when a party is prevented from fully presenting his case to the court as
when the lawyer connives to defeat or corruptly sells out his client’s interest.
Extrinsic fraud can be committed by a counsel against his client when the latter
is prevented from presenting his case to the court.

Mistake as used in Rule 38 means mistake of fact and not mistake of law. A
wrong choice in legal strategy or mode of procedure will not be considered a
mistake for purposes of granting a petition for relief from judgment. Mistake as a
ground also “does not apply and was never intended to apply to a judicial error
which the court might have committed in the trial since such error may be
corrected by means of an appeal.” Mistake can be of such nature as to cause

61
substantial injustice to one of the parties. It may be so palpable that it borders on
extrinsic fraud.

FACTS:

Respondent Ester Maramba was a grantee of a DENR miscellaneous

lease contract for a property in Dagupan City for a period of 25 years. In
1974, she caused the construction of a commercial fish center on the
property. In 2003, petitioner city demolished the commercial fish center,
allegedly without giving direct notice to Maramba and with threat of
taking over the property. This prompted Maramba to file a complaint for
injunction and damages with prayer for a writ of preliminary injunction
and/or temporary restraining order.

The complaint alleged that the demolition was unlawful and that the
“complete demolition and destruction of the previously existing
commercial fish center of plaintiff is valued at Five Million
(P10,000,000.00) pesos.”[8] The word, “ten,” was handwritten on top of
the word, “five.”

In the complaint’s prayer, Maramba asked for a judgment “ordering

defendant corporation to pay her P10,000 for the actual and present value
of the commercial fish center completely demolished by public
defendant.” The word, “million,” was handwritten on top of the word,
“thousand,” and an additional zero was handwritten at the end of the
numerical figure. The handwritten intercalation was not explained in any
part of the records and in the proceedings.

The trial court ruled in favor of Maramba. Petitioner city then filed a
petition for relief together with an affidavit of merit alleging that “the
decision, were it not for the City Legal Officer’s mistake, negligence and
gross incompetence, would not have been obtained by the plaintiff, or
should have been reconsidered or otherwise overturned, the damage
award being not only unconscionable and unreasonable, but completely
baseless.” The trial court denied petitioner city’s petition for relief and

62
ordered that the writ of execution. The court stressed that “the negligence
of counsel binds the client.”

Petitioner city filed for reconsideration. The trial court granted the
petition for relief and consequently modified its decision. reducing the
award of actual damages from P10 million to P75,000.00. Plaintiff was
only able to prove the amount of P75,000 as the appraised value of the
improvements made on the leased premises. She was not able to show
proof of the P5 million amount of improvements made on the
establishment, as she was claiming to have been made. Too, she did not
show any single receipt for her travelling expenses and for the car rental
she made during her stay in the country for the purpose of prosecuting
this case.

Maramba filed a petition for certiorari before the Court of Appeals which
was later granted, holding that petitioner’s motion for reconsideration
lacked a notice of hearing and was a mere scrap of paper that did not toll
the period to appeal. She maintains that petitioner city is bound by the
mistake of its counsel in failing to include a notice of hearing in its motion
for reconsideration.

Petitioner city agrees that “judgments must be final at some definite

date,” but Rule 38 also provides for relief from judgments, orders, and
other proceedings. It submits that it raised substantial issues in its motion
for reconsideration such as the excessive damages awarded by the lower
court in its decision. The petition for relief was correctly granted as
“counsel’s mistake amounted to extrinsic fraud” and “to give the plaintiff
much more than it was able to prove and allow the faulty decision to be
implemented is, truly, a deprivation of defendant of its property without
due process.”

ISSUE:
Was there excusable negligence for the lack of notice of hearing in a MR
that allows the filing of a petition for relief of judgment?

RULING:

63
YES. This Court has indeed held time and time again that, under Sections
4 and 5 of Rule 15 of the Rules of Court, mandatory is the notice
requirement in a motion, which is rendered defective by failure to comply
with the requirement. As a rule, a motion without a notice of hearing is
considered pro forma and does not affect the reglementary period for the
appeal or the filing of the requisite pleading. However, courts may set
aside final and executory judgments provided that any of the grounds for
their grant are present. The presence of “fraud, accident, mistake or
excusable negligence” must be assessed from the circumstances of the
case.

Excusable negligence as a ground for a petition for relief requires that the
negligence be so gross “that ordinary diligence and prudence could not
have guarded against it.” This excusable negligence must also be
imputable to the party-litigant and not to his or her counsel whose
negligence binds his or her client. The binding effect of counsel’s
negligence ensures against the resulting uncertainty and tentativeness of
proceedings if clients were allowed to merely disown their counsels’
conduct.

Nevertheless, this court has relaxed this rule on several occasions such as:
“(1) where the reckless or gross negligence of counsel deprives the client
of due process of law; (2) when the rule’s application will result in
outright deprivation of the client’s liberty or property; or (3) where the
interests of justice so require.” Certainly, excusable negligence must be
proven.

Fraud as a ground for a petition for relief from judgment pertains to

extrinsic or collateral fraud. There is extrinsic fraud when a party is
prevented from fully presenting his case to the court as when the lawyer
connives to defeat or corruptly sells out his client’s interest. Extrinsic
fraud can be committed by a counsel against his client when the latter is
prevented from presenting his case to the court.

Mistake as used in Rule 38 means mistake of fact and not mistake of law.
A wrong choice in legal strategy or mode of procedure will not be
considered a mistake for purposes of granting a petition for relief from

64
judgment. Mistake as a ground also “does not apply and was never
intended to apply to a judicial error which the court might have
committed in the trial since such error may be corrected by means of an
appeal.” Mistake can be of such nature as to cause substantial injustice to
one of the parties. It may be so palpable that it borders on extrinsic fraud.

Petitioner city recounted the “mistakes, negligence, incompetence and

suspicious acts/omissions” of city legal officer Atty. Roy Laforteza in the
affidavit of merit signed by then Mayor Benjamin Lim. Atty. Laforteza’s
“mistake” was fatal considering that the trial court awarded a total
amount of P11 million in favor of Maramba based merely on her
testimony that “the actual cost of the building through continuous
improvement is Five Million more or less”; that her husband spent $1,760
for a round trip business travel to the Philippines to attend to the case;
and that “for his accommodation and car rental, her husband spent more
or less, P10,000.00 including round trip ticket.”

First, nowhere in the trial court’s decision did it state or refer to any
document presented by Maramba to substantiate her claimed costs. In
fact, the amounts she testified on did not even add up to the P10 million
the court awarded as actual damages. On the other hand, the next
decision discussed that “Maramba was only able to prove the amount of
P75,000 as the appraised value of the improvements made on the leased
premises.”

Second, the body of the trial court’s decision mentioned that Maramba
was entitled to P1 million as moral damages and P500,000.00 as attorney’s
fees. This is inconsistent with the dispositive portion that awarded
P500,000 as moral damages and P500,000 as attorney’s fees. The affidavit
of merit discussed that Maramba testified on her shock, sleepless nights,
and mental anguish, but she never expressly asked for moral damages or
specified the amount of P500,000. On the amount of attorney’s fees, the
affidavit of merit explained that Maramba did not show a legal retainer
but only mentioned in passing, “Of course, I am asking for my attorney’s
fees in the amount of P500,000.”

65
Maramba now wants this court to overlook all these blatant discrepancies
and maintain the P11 million unsubstantiated award in her favor on the
sole ground that petitioner city’s assistant legal officer failed to include a
notice of hearing in its motion for reconsideration that was filed within
the 15-day reglementary period. She did not even attempt to address the
lower court’s findings that her claimed amounts as damages were all
unsubstantiated.

There were discrepancy and lack of proof on the amount of moral

damages and attorney’s fees awarded. Petitioner city’s petition for relief
was correctly granted in the trial court’s decision. Section 4 of Rule 38
provides that “if the petition is sufficient in form and substance to justify
relief, the court shall issue an order requiring the adverse parties to
answer the same within 15 days from the receipt thereof.”

66
 Cathay Metal Corp. v. Laguna West Multi-Purpose Cooperative

G.R. No. 172204

July 2, 2014

Leonen, J.

DOCTRINE:
Section 11, Rule 14 of the Rules of Court provides the rule on service of
summons upon a juridical entity. It provides that summons may be served upon
a juridical entity only through its officers. When the defendant is a corporation,
partnership or association organized under the laws of the Philippines with a
juridical personality, service may be made on the president, managing partner,
general manager, corporate secretary, treasurer, or in-house counsel. The
enumeration in Section 11 of Rule 14 is exclusive. Even substantial compliance is
not sufficient service of summons. This provision of the rule does not limit service
to the officers’ places of residence or offices. If summons may not be served upon
these persons personally at their residences or offices, summons may be served
upon any of the officers wherever they may be found. Hence, petitioner cannot
use respondent’s failure to amend its Articles of Incorporation to reflect its new
address as an excuse from sending or attempting to send to respondent copies of
the petition and the summons. The Rules of Court provides that notices should be
sent to the enumerated officers. Petitioner failed to do this. No notice was ever
sent to any of the enumerated officers.

Service by publication is available when the whereabouts of the defendant is

unknown. Section 14, Rule 14 of the Rules of Court provides that in any action
where the defendant is designated as an unknown owner, or the like, or whenever
his whereabouts are unknown and cannot be ascertained by diligent inquiry,
service may, by leave of court, be effected upon him by publication in a newspaper
of general circulation and in such places and for such time as the court may
order.

FACTS:

Respondent Laguna West Multi-Purpose Cooperative is a

cooperative recognized under Republic Act No. 6657 (CARP Law). It
allegedly entered into a joint venture agreement with farmer-beneficiaries

67
through Certificates of Land Ownership Award (CLOA). While
respondent was negotiating with the farmer-beneficiaries, petitioner
Cathay Metal Corporation entered into Irrevocable Exclusive Right to Buy
(IERB) contracts with the same farmer-beneficiaries. Under the IERB, the
farmer-beneficiaries committed themselves to sell to petitioner their
agricultural properties upon conversion to industrial or commercial
properties or upon expiration of the period of prohibition from
transferring title to the properties.

In 1996, respondent caused the annotation of its adverse claim on the

farmer-beneficiaries’ certificates of title. In 1998, DAR issued an order
converting the properties from agricultural to mixed use. In 1999,
petitioner and the farmer-beneficiaries executed contracts of sale of the
properties. The annotations in the original titles were copied to
petitioner’s titles. Respondent’s Vice President, Orlando dela Peña, sent
letters to petitioner, informing it of respondent’s claim to the properties.
Petitioner did not respond.

In 2000, petitioner filed a consolidated petition for cancellation of adverse

claims on its TCTs with RTC Tagaytay City. It served a copy of the
petition by registered mail to respondent’s alleged official address. The
petition was returned to sender because respondent could not be found at
that address. The postman issued a certification stating that the reason for
the return was that the “cooperative was not existing.” Petitioner
allegedly attempted to serve the petition upon respondent personally.
However, this service failed for the same reason. Upon petitioner’s
motion, RTC issued an order declaring petitioner’s substituted service,
apparently by registered mail, to have been effected. Petitioner was later
allowed to present its evidence ex-parte.

Upon learning that a case involving its adverse claim was pending,
respondent filed a manifestation and motion, alleging that respondent
never received a copy of the summons and the petition. It moved for the
service of the summons and for a copy of the petition to be sent to
Laguna. The RTC granted respondent’s motion. Instead of furnishing
respondent with a copy of the petition, petitioner filed a MR arguing that
the respondent was already in default, a manifestation and motion,

68
without allegations of grounds for a motion to lift order of default, would
not give it personality to participate in the proceedings.

Respondent received a copy of the motion for reconsideration after the

hearing and filed a motion for leave to admit attached opposition and
opposition to petitioner’s motion for reconsideration of order arguing that
since petitioner’s ex parte presentation of evidence was secured through
extrinsic fraud, there should be a new trial to give respondent a fair day in
court. This was opposed by petitioner emphasizing its alleged compliance
with the Cooperative Code rule on notices and respondent’s failure to file
its comment despite the court’s order that approved petitioner’s
substituted service. The RTC granted petitioner’s motion finding that
service should be made to the address indicated in its Cooperative
Development Authority Certificate of Registration.

The RTC then issued a decision granting petitioner’s petition for

cancellation of annotations. Respondent appealed to the Court of Appeals
based on the ground that the trial court erred in applying the rule on
substituted service, thus, it did not validly acquire jurisdiction over the
appellant. The Court of Appeals granted respondent’s appeal. Hence, the
case.

ISSUE:
Was the respondent properly served with summons or notices of the
hearing on the petition for cancellation of annotations of adverse claim on
the properties?

RULING:
NO. On matters relating to procedures in court, it shall be the Rules of
Procedure that will govern. Service of notices and summons on interested
parties in a civil, criminal, or special proceeding is court procedure.
Hence, it shall be governed by the Rules of Procedure.

The Cooperative Code provisions may govern matters relating to

cooperatives’ activities as administered by the Cooperative Development
Authority. However, they are not procedural rules that will govern court
processes. A Cooperative Code provision requiring cooperatives to have

69
an official address to which all notices and communications shall be sent
cannot take the place of the rules on summons under the Rules of Court
concerning a court proceeding.

This is not to say that the notices cannot be sent to cooperatives in

accordance with the Cooperative Code. Notices may be sent to a
cooperative’s official address. However, service of notices sent to the
official address in accordance with the Cooperative Code may not be used
as a defense for violations of procedures, specially when such violation
affects another party’s rights.

Section 11, Rule 14 of the Rules of Court provides the rule on service of
summons upon a juridical entity. It provides that summons may be
served upon a juridical entity only through its officers. The enumeration
in Section 11 of Rule 14 is exclusive. Even substantial compliance is not
sufficient service of summons. This provision of the rule does not limit
service to the officers’ places of residence or offices. If summons may not
be served upon these persons personally at their residences or offices,
summons may be served upon any of the officers wherever they may be
found.

Hence, petitioner cannot use respondent’s failure to amend its Articles of

Incorporation to reflect its new address as an excuse from sending or
attempting to send to respondent copies of the petition and the summons.
The Rules of Court provides that notices should be sent to the enumerated
officers. Petitioner failed to do this. No notice was ever sent to any of the
enumerated officers.

Petitioner insists that it should not be made to inquire further as to the

whereabouts of respondent after the attempt to serve the summons by
registered mail to respondent’s address as allegedly indicated in its
Articles of Incorporation. The Rules does not provide that it needs to do
so. However, it provides for service by publication. Service by publication
is available when the whereabouts of the defendant is unknown.

In this case, petitioner served summons upon respondent by registered

mail and, allegedly, by personal service at the office address indicated in

70
respondent’s Certificate of Registration. Summons was not served upon
respondent’s officers. It was also not published in accordance with the
Rules of Court. As a result, respondent was not given an opportunity to
present evidence, and petitioner was able to obtain from the RTC an order
cancelling respondent’s annotations of adverse claims.

71
 People of the Philippines v. Roberto Holgado and Antonio Misarez

G.R. No. 207992

August 11, 2014

Leonen, J.

DOCTRINE:
By failing to establish identity of corpus delicti, noncompliance with Section 21
indicates a failure to establish an element of the offense of illegal sale of dangerous
drugs. It follows that this noncompliance suffices as a ground for acquittal. Trial
courts should meticulously consider the factual intricacies of cases involving
violations of RA 9165. All details that factor into an ostensibly uncomplicated
and barefaced narrative must be scrupulously considered. Courts must employ
heightened scrutiny, consistent with the requirement of proof beyond reasonable
doubt, in evaluating cases involving miniscule amounts of drugs.

FACTS:
The Pasig City Police received reports of illegal drug activities of
Holgado. After surveillance operations, a search warrant was issued
against Holgado. Acting on the search warrant, the Pasig City Chief of
Police instructed his officers to, if possible, first conduct a buy-bust
operation before actually enforcing the search warrant. Police operatives
conducted the buy-bust operation. PO1 Philip Aure, acting as poseur-
buyer, saw his companions approaching, he seized Misarez’s hand, but
the latter was able to escape and lock himself inside the house. Holgado,
too, was able to flee into the house and join Misarez. The police managed
to get inside the adjoining house where they apprehended Holgado and
Misarez.

The search warrant was then enforced and yielded several drugs and
drug paraphernalia. PO3 Abuyme prepared an inventory of the seized
items. With respect to the plastic sachet, PO1 Aure supposedly marked
the plastic sachet handed to him by Misarez with “RH-PA” at the site of
the buy-bust operation.

72
After trial, the RTC found both accused guilty of illegal sale of dangerous
drugs, however, they were acquitted of the charges pertaining to drugs
supposedly seized that were not introduced in evidence. Holgado was
also acquitted of the charges relating to Section 12 as the paraphernalia to
which PO2 Castulo testified to in court were different from those
indicated in the inventory supposedly made when the search warrant was
enforced. On appeal, they assailed the supposed lack of compliance with
the requirements set by the chain of custody of seized drugs and drug
paraphernalia as provided by Section 21 of Republic Act No. 9165.

ISSUE:
Was the chain of custody established?

RULING:
NO. Compliance with the chain of custody requirement provided by
Section 21 ensures the integrity of confiscated, seized, and/or
surrendered drugs and/or drug paraphernalia in 4 respects: first, the
nature of the substances or items seized; second, the quantity of the
substances or items seized; third, the relation of the substances or items
seized to the incident allegedly causing their seizure; and fourth, the
relation of the substances or items seized to the person/s alleged to have
been in possession of or peddling them. By failing to establish identity of
corpus delicti, noncompliance with Section 21 indicates a failure to
establish an element of the offense of illegal sale of dangerous drugs. It
follows that this noncompliance suffices as a ground for acquittal.

In this case, the defense points out that with respect to the handling of the
sachet handed by Misarez to PO1 Aure, was that PO1 Aure supposedly
marked it “RH-PA” at the scene of the buy-bust operation. While the buy-
bust operation team allegedly conducted an inventory of the seized items,
it is unclear if this inventory was limited to those seized pursuant to the
enforcement of the search warrant or was inclusive of whatever items
seized during the buy-bust operation. In any case, this inventory was
discredited as Holgado was acquitted of the charge of illegal possession of
drug paraphernalia because the inventory was found to be unreliable as
the paraphernalia PO2 Castulo testified to in court were different from

73
those indicated in the inventory supposedly made when the search
warrant was enforced.

Trial courts should meticulously consider the factual intricacies of cases

involving violations of Republic Act No. 9165. All details that factor into
an ostensibly uncomplicated and barefaced narrative must be
scrupulously considered. Courts must employ heightened scrutiny,
consistent with the requirement of proof beyond reasonable doubt, in
evaluating cases involving miniscule amounts of drugs. These can be
readily planted and tampered. Also, doubt normally follows in cases
where an accused has been discharged from other simultaneous offenses
due to mishandling of evidence.

While they are certainly a bane to our society, small retailers are but low-
lying fruits in an exceedingly vast network of drug cartels. Both law
enforcers and prosecutors should realize that the more effective and
efficient strategy is to focus resources more on the source and true
leadership of these nefarious organizations. Otherwise, all these executive
and judicial resources expended to attempt to convict an accused for 0.05
gram of shabu under doubtful custodial arrangements will hardly make a
dent in the overall picture. Accused-appellants are hereby acquitted for
failure of the prosecution to prove their guilt beyond reasonable doubt.

74
 Alfredo Villamor, Jr. v. John Umale

G.R. No. 172881

September 24, 2014

Leonen, J.

DOCTRINE:
Judgment must be made binding upon the corporation in order that the
corporation may get the benefit of the suit and may not bring a subsequent suit
against the same defendants for the same cause of action. In other words, the
corporation must be joined as party because it is its cause of action that is being
litigated and because judgment must be a res judicata against it.

The Regional Trial Court has original and exclusive jurisdiction to hear and
decide intra-corporate controversies, including incidents of such controversies.
These incidents include applications for the appointment of receivers or
management committees. “The receiver and members of the management
committee . . . are considered officers of the court and shall be under its control
and supervision.” They are required to report to the court on the status of the
corporation within sixty (60) days from their appointment and every three (3)
months after.

In derivative suits, the real party-in-interest is the corporation, and the suing
stockholder is a mere nominal party. The Court has recognized that a
stockholder’s right to institute a derivative suit is not based on any express
provision of the Corporation Code, or even the Securities Regulation Code, but is
impliedly recognized when the said laws make corporate directors or officers liable
for damages suffered by the corporation and its stockholders for violation of their
fiduciary duties. In effect, the suit is an action for specific performance of an
obligation, owed by the corporation to the stockholders, to assist its rights of
action when the corporation has been put in default by the wrongful refusal of the
directors or management to adopt suitable measures for its protection.

FACTS:
MC Home Depot occupied a prime property (Rockland area) in
Pasig which was part of the area owned by Mid-Pasig Development
Corporation. The Pasig Printing Corporation obtained an option to lease

75
portions of Mid-Pasig’s property, including the Rockland area. PPC’s
board of directors issued a resolution waiving all its rights, interests, and
participation in the option to lease contract in favor of the law firm of
Atty. Alfredo Villamor. PPC received no consideration for this waiver in
favor of Villamor’s law firm.

PPC entered into a memorandum of agreement with MC Home Depot

where the latter would continue to occupy the area as PPC’s sub-lessee
for 4 years, renewable for another 4 years, at a monthly rental of
P4,500,000 plus goodwill of P18,000,000. In compliance with the MOA,
MC Home issued 20 postdated checks representing rental payments for
one year and the goodwill money. The checks were given to Villamor
who did not turn these or the equivalent amount over to PPC, upon
encashment.

Respondent Hernando Balmores, respondent, stockholder and director of

PPC, wrote a letter addressed to PPC’s directors informing them that
Villamor should be made to deliver to PPC and account for MC Home
Depot’s checks or their equivalent value. Due to the alleged inaction of
the directors, respondent Balmores filed with the RTC an intra-corporate
controversy complaint under Rule 1, Section 1(a)(1) of the Interim Rules
for Intra-Corporate Controversies against petitioners for their alleged
devices or schemes amounting to fraud or misrepresentation “detrimental
to the interest of the corporation and its stockholders.”

Respondent Balmores alleged in his complaint that because of petitioners’

actions, PPC’s assets were “. . . not only in imminent danger, but have
actually been dissipated, lost, wasted and destroyed.” The RTC denied
respondent Balmores’ prayer. According to the trial court, there was “no
clear and positive showing of dissipation, loss, wastage, or destruction of
[PPC’s] assets . . . [that was] prejudicial to the interest of the minority
stockholders, parties-litigants or the general public.” The board’s failure
to recover the disputed amounts was not an indication of
mismanagement resulting in the dissipation of assets. The trial court
added that the failure to implead PPC was fatal. PPC should have been
impleaded as an indispensable party, without which, there would be no
final determination of the action.

76
On appeal to the CA, it reversed the trial court’s decision. In reversing the
trial court order/resolution, the danger of dissipation, wastage, and loss
of PPC’s assets if the review of the trial court’s judgment would be
delayed. It also characterized the Balmores’ action as one of a derivative
suit.

ISSUE:
Did Balmores file a derivative suit?

RULING:
NO. A derivative suit is an action filed by stockholders to enforce a
corporate action. It is an exception to the general rule that the
corporation’s power to sue is exercised only by the board of directors or
trustees. Individual stockholders may be allowed to sue on behalf of the
corporation whenever the directors or officers of the corporation refuse to
sue to vindicate the rights of the corporation or are the ones to be sued
and are in control of the corporation.

In derivative suits, the real party-in-interest is the corporation, and the

suing stockholder is a mere nominal party. The Court has recognized that
a stockholder’s right to institute a derivative suit is not based on any
express provision of the Corporation Code, or even the Securities
Regulation Code, but is impliedly recognized when the said laws make
corporate directors or officers liable for damages suffered by the
corporation and its stockholders for violation of their fiduciary duties. In
effect, the suit is an action for specific performance of an obligation, owed
by the corporation to the stockholders, to assist its rights of action when
the corporation has been put in default by the wrongful refusal of the
directors or management to adopt suitable measures for its protection.
Rule 8, Section 1 of the Interim Rules of Procedure for Intra-Corporate
Controversies provides the requisites for filing derivative suits:

(1) He was a stockholder or member at the time the acts or transactions

subject of the action occurred and at the time the action was filed;
(2) He exerted all reasonable efforts, and alleges the same with
particularity in the complaint, to exhaust all remedies available under the

77
articles of incorporation, bylaws, laws or rules governing the corporation
or partnership to obtain the relief he desires;
(3) No appraisal rights are available for the act or acts complained of;
and
(4) The suit is not a nuisance or harassment suit.

The fifth requisite for filing derivative suits is implied in Rule 8, Section 1,
Par. 1 of the Interim Rules: The action brought by the stockholder or
member must be “in the name of [the] corporation or association. . . .”
Moreover, it is important that the corporation be made a party to the case.

Respondent Balmores failed to exhaust all available remedies to obtain

the reliefs he prayed for. Though he tried to communicate with PPC’s
directors about the checks in Villamor’s possession before he filed an
action with the trial court, respondent Balmores was not able to show that
this comprised all the remedies available under the articles of
incorporation, bylaws, laws, or rules governing PPC. An allegation that
appraisal rights were not available for the acts complained of is another
requisite for filing derivative suits under Rule 8, Section 1(3) of the
Interim Rules.

Granting that (a) respondent Balmores’ attempt to communicate with the

other PPC directors already comprised all the available remedies that he
could have exhausted and (b) the corporation was under full control of
petitioners that exhaustion of remedies became impossible or futile,
respondent Balmores failed to allege that appraisal rights were not
available for the acts complained of here. Neither did respondent
Balmores implead PPC as party in the case nor did he allege that he was
filing on behalf of the corporation.

The nonderivative character of respondent Balmores’ action may also be

gleaned from his allegations in the trial court complaint. In the complaint,
he described the nature of his action as an action under Rule 1, Section
1(a)(1) of the Interim Rules, and not an action under Rule 1, Section 1(a)(4)
of the Interim Rules, which refers to derivative suits.

78
Rule 1, Section 1(a)(1) of the Interim Rules refers to acts of the board,
associates, and officers, amounting to fraud or misrepresentation, which
may be detrimental to the interest of the stockholders. This is different
from a derivative suit. While devices and schemes of the board of
directors, business associates, or officers amounting to fraud under Rule
1, Section 1(a)(1) of the Interim Rules are causes of a derivative suit, it is
not always the case that derivative suits are limited to such causes or that
they are necessarily derivative suits. Hence, they are separately
enumerated in Rule 1, Section 1(a) of the Interim Rules.

Respondent Balmores’ intent to file an individual suit removes it from the

coverage of derivative suits. In this case, respondent Balmores did not
allege any cause of action that is personal to him. His allegations are
limited to the facts that PPC’s directors waived their rights to rental
income in favor of Villamor’s law firm without consideration and that
they failed to take action when Villamor refused to turn over the amounts
to PPC. These are wrongs that pertain to PPC. Therefore, the cause of
action belongs to PPC — not to respondent Balmores or any stockholders
as individuals. For this reason, respondent Balmores is not entitled to the
reliefs sought in the complaint. Only the corporation, or arguably the
stockholders as a group, is entitled to these reliefs, which should have
been sought in a proper derivative suit filed on behalf of the corporation.

79
 PEOPLE V. MARK JASON CHAVEZ

G.R. No. 207950

September 22, 2014

J. Leonen

DOCTRINE:
"[w]hat is imperative and essential for a conviction for the crime of robbery with
homicide is for the prosecution to establish the offender’s intent to take personal
property before the killing, regardless of the time when the homicide is actually
carried out."

FACTS:
On October 28, 2006, Peñamante arrived home at around 2:45 a.m.,
coming from work as a janitor in Eastwood City. When he was about to
go inside his house at 1326 Tuazon Street, Sampaloc, Manila, he saw a
person wearing a black, long-sleeved shirt and black pants and holding
something while leaving the house/parlor of Elmer Duque (Barbie) at
1325 Tuazon Street, Sampaloc, Manila, just six meters across Peñamante’s
house. There was a light at the left side of the house/parlor of Barbie, his
favorite haircutter, so Peñamante stated that he was able to see the face of
Chavez and the clothes he was wearing. Chavez could not close the door
of Barbie’s house/parlor so he simply walked away. However, he
dropped something that he was holding and fell down when he stepped
on it. He walked away after, and Peñamante was not able to determine
what Chavez was holding. The following day, Barbie was found dead,
due to stab wounds, in the parlor and the place was in disarray. In a line-
up to identify the person he saw leaving Barbie’s house/parlor that early
morning of October 28, 2006, Peñamante immediately pointed to and
identified Chavez and thereafter executed his written statement. Chavez
was charged with robbery with homicide.

ISSUE:
Whether Chavez is guilty beyond reasonable doubt of the crime of
robbery with homicide.

80
RULING:
NO. There was no robbery. “What is imperative and essential for a
conviction for the crime of robbery with homicide is for the prosecution to
establish the offender’s intent to take personal property before the killing,
regardless of the time when the homicide is actually carried out.” In cases
when the prosecution failed to conclusively prove that homicide was
committed for the purpose of robbing the victim, no accused can be
convicted of robbery with homicide.
The circumstantial evidence relied on by the lower courts do not
satisfactorily establish an original criminal design by Chavez to commit
robbery. At most, the intent to take personal property was mentioned by
Chavez’s mother in her statement as follows: “Na sinabi niya sa akin na
wala siyang intensyon na patayin [sic] si Barbie kundi ay pagnakawan
lamang.” However, this statement is considered as hearsay, with no
evidentiary value, since Chavez’s mother was never presented as a
witness during trial to testify on her statement.
An original criminal design to take personal property is also inconsistent
with the infliction of no less than 21 stab wounds in various parts of
Barbie’s body. The sheer number of stab wounds inflicted on Barbie
makes it difficult to conclude an original criminal intent of merely taking
Barbie’s
personal property. Homicide – All these circumstances taken together
establish Chavez’s guilt beyond reasonable doubt
for the crime of homicide:

1. The alibi of Chavez still places him at the scene of the crime that early
morning of October 28, 2006. This court has considered motive as one of
the factors in determining the presence of an intent to kill, and a
confrontation with the victim immediately prior to the victim’s death has
been considered as circumstantial evidence for homicide.
2. The number of stab wounds inflicted on Barbie strengthens an
intention to kill and ensures his death.
3. Peñamante’s positive identification of Chavez as the person leaving
Barbie’s house that early morning of October 28, 2006.
4. The medico-legal’s testimony establishing Barbie’s time of death as 12
hours prior to autopsy at 1:00 p.m., thus, narrowing the time of death to
approximately 1:00 a.m. of the same day, October 28, 2006.

81
THE HONORABLE OFFICE OF THE OMBUDSMAN V. DELOS
REYES

G.R. No. 208976

October 13, 2014

J. Leonen

DOCTRINE:
It is settled that appeals from decisions of the Office of the Ombudsman in
administrative disciplinary cases should be appealed to the Court of Appeals
under Rule43 of the Rules of Court.

FACTS:

On June 13, 2001, PCSO auditorssubmitted a consolidated report

based on a surprise audit conducted on June 5, 2001. The auditors found
that the cash and cash items under Delos Reyes’ control were in order.
However, the auditors recommended thatthe lotto proceeds be deposited
in a bank the next working day instead of Delos Reyes keeping the lotto
sales and proceeds in a safe inside his office. On June 5, 2002, COD
Manager Josefina Lao instructed OIC Division Chief of the Liaison and
Accounts Management Division Teresa Nucup (Nucup) to conduct an
account validation and verification to reconcile accounts due to
substantial outstanding balances as of May 31, 2002. On August 16, 2002,
Nucup reported that Agency No. 14-5005-1 had unremitted collections in
the amount of ₱428,349.00 from May 21, 2001 to June 3, 2001. The amount
was subsequently reduced to ₱387,879.00 excluding penalties. Nucup also
found that "there was a deliberate delay in the submission of the periodic
sales report; that the partial remittance of total sales were made to cover
previous collections; and that the unremitted collections were attributed
to Cesar Lara, Cynthia Roldan, Catalino Alexandre Galang, Jr., who were
all employed by [PCSO] as Lottery Operations Assistants II, and Elizabeth
Driz, the Assistant Division Chief.

On May 14, 2003, formal charges were filed against Delos Reyes and Driz,
with the cases docketed as Administrative Case Nos. 03-01 and 03-02,

82
respectively. After the submission of the parties’ pleadings, the Office of
the Ombudsman rendered the decision dated June 10, 2006 in OMB-C-A-
04-0309-G finding Delos Reyes and Driz guilty of grave misconduct and
gross neglect of duty, and ordering their dismissal from service. Delos
Reyes’ partial motion for reconsideration was denied on November 15,
2007. He then filed before the Court of Appeals a petition for certiorari
docketed as CA-G.R. SP No. 117683 under Rule 65 of the Rules of Court.

ISSUE:
Whether the Court of Appeals erred in taking cognizance of the petition
for certiorari under Rule 65 of the Rules of Court despite availability of
the remedy under Rule 43 of the Rules of Court

RULING:
At the outset, we note that the Court of Appeals initially dismissed the
petition for certiorari under Rule 65 filed by respondent to assail the
Office of the Ombudsman’s decision dated June 10, 2006. The Court of
Appeals, however, reinstated the case "in the interest of substantial justice
and in order to afford the parties the amplest opportunity for the proper
and just disposition of their cause."

It is settled that appeals from decisions of the Office of the Ombudsman in

administrative disciplinary cases should be appealed to the Court of
Appeals under Rule 43 of the Rules of Court. Indeed, certiorari lies to
assail the Office of the Ombudsman’s decision when there is allegation of
grave abuse of discretion. Grave abuse of discretion involves a "capricious
and whimsical exercise of judgment tantamount to lack of jurisdiction." It
must be shown that the Office of the Ombudsman exercised its power "in
an arbitrary or despotic manner which must be so patent and gross as to
amount to an evasion of a positive duty or a virtual refusal to perform the
duty enjoined or to act at all in contemplation of law in order to
exceptionally warrant judicial intervention."

The prevailing view is that the remedy of certiorari from an unfavorable

decision or resolution of the Office of the Ombudsman is available only in
the following situations: a) in administrative cases that have become final

83
and unappealable where respondent is exonerated or where respondent is
convicted and the penalty imposed is public censure or reprimand,
suspension of not more than one month, or a fine equivalent to a one-
month salary; and b) in criminalcases involving the Office of the
Ombudsman’s determination of probable cause during preliminary
investigation.

84
 ATTY. ANACLETO B. BUENA V. DR. SANGCAD BENITO

G.R. No. 181760

October 14, 2014

J. Leonen

DOCTRINE:
The Regional Governor of the Autonomous Region in Muslim Mindanao
(ARMM) has the power to appoint officers in the region's civil service. However,
if there is no regional law providing for the qualifications for the position at the
time of appointment, the appointee must satisfy the civil service eligibilities
required for the position in the national government to be appointed in a
permanent capacity.

FACTS:

Regional Governor Dr. Parouk S. Hussin of the ARMM appointed

Dr.
Sangcad D. Benito as Assistant Schools Division Superintendent of the
Department of Education (DepEd) Division on Lanao del Sur in a
temporary capacity. In 2005, Hussin reappointed Dr. Benito in the same
position but in a permanent capacity. Hussin requested the Civil Service
Commission Regional Office of the ARMM to attest to Dr. Benito’s
appointment. However, Regional Director Anacleto B. Buena (Buena)
declined on the ground that Dr. Benito did not possess the career
executive service eligibility required for the said position. The latter filed
a petition for Mandamus before the Regional Trial Court to compel the
Regional Office to attest to his permanent appointment arguing that the
position does not belong to the
Career Executive Service under the Administrative Code of 1987, thus, the
position does not require Career Executive Service eligibility. He further
claimed that under RA 9054, Regional Governor of the ARMM is the
appointing authority for positions in the civil service in the region. Since
Hussin already exercised his discretion, the Regional Office had no choice
but to attest to his appointment.

85
Buena claimed that the permanent appointee must have career executive
service eligibility. According to Buena, the Regional Office recognizes the
autonomy of the ARMM. However, until the region enacts its own
regional civil service law, the Regional Office shall carry on with the Civil
Service Commission’s mandate under the Constitution to promote and
enforce civil service laws and rules.

ISSUE:
Is Dr. Benito validly appointed as Assistant Schools Division
Superintendent in a permanent capacity by the Regional Governor of
ARMM?

RULING:
No. The position of Assistant Schools Division Superintendent belongs to
the Career Executive Service. Appointment to the position is based on
merit and fitness and gives the appointee an opportunity for
advancement to higher career positions, such as Schools Division
Superintendent. If permanently appointed, the appointee is guaranteed
security of tenure. The position is above Division Chief. An Assistant
Schools Division Superintendent has a salary grade of 25. As to functions
and responsibilities, the Assistant Schools Division Superintendent assists
the Schools Division Superintendent in performing executive and
managerial functions under Governance of Basic Education Act of 2001.
In fact, the law recognizes that the position of Assistant Schools Division
Superintendent belongs to the Career Executive Service. Section 7 of the
said law explicitly provides that an appointee to the position must be a
career executive service officer. In this case, Dr. Benito does not possess
the required career executive service eligibility. He, therefore, cannot be
appointed to the position of Assistant Schools Division Superintendent in
a permanent capacity. The Civil Service Commission cannot be compelled
to attest to the permanent appointment of Dr. Benito. The Regional
Governor has the power to appoint civil servants in the ARMM under
Republic Act No. 9054. In Muslim Mindanao Autonomy Act No. 279 or
the ARMM Basic Education Act of 2010, the Regional Assembly set the

86
qualification standards of Assistant Schools Division Superintendents of
Divisions of the Department of Education in the Autonomous Region.
Nevertheless, when Dr. Benito was appointed Assistant Schools Division
Superintendent in 2005, there was yet no regional law providing for the
qualifications for the Assistant Schools Division Superintendents of
Divisions of the Department of Education in the Autonomous Region.

87
 SPS. BENEDICT AND SANDRA MANUEL V. RAMON ONG

G.R. No. 205249

October 15, 2014

J. Leonen

DOCTRINE:
The issuance of the orders of default should be the exception rather than the rule,
to be allowed only in clear cases of obstinate refusal by the defendant to comply
with the orders of the trial court.

FACTS:
Respondent Ramon Ong (Ong) filed with the Regional Trial Court
of La Trinidad, Benguet a complaint for accion reivindicatoria. Ong
charged the Spouses Manuel with having constructed improvements —
through force, intimidation, strategy, threats, and stealth — on a property
he supposedly owned.
Ong filed with the Regional Trial Court a motion to declare the Spouses
Manuel in default.
o Sheriff Joselito Sales attempted to personally serve summons on the
Spouses Manuel at their address in Lower Bacong, Loacan, Itogon,
Benguet.
o Spouses Manuel, however, requested that service be made at
another time considering that petitioner Sandra Manuel's mother was
then critically ill.
o Sheriff Sales made another attempt at personal service to petitioner
Sandra Manuel but she refused to sign and receive the summons and the
complaint. Sheriff Sales was thus prompted to merely tender the
summons.
o As the Spouses Manuel failed to file their answer within the
required 15-day period, Ong asked that they be declared in default.

RTC: issued an order granting Ong's motion to declare the Spouses

Manuel in default. RTC also granted motion for ex parte presentation of
evidence.
Spouses Manuel filed a motion to lift the order of default.

88
They claimed that it is the siblings of petitioner Sandra Manuel who
resided in Lower Bacong, Itogon, Benguet so summons could not have
been properly served on them in the former address.
RTC: denied motion to lift order of default.

ISSUES:
Whether jurisdiction over their person was acquired?
Whether the Spouses Manuel may be granted relief from the order of
default?

RULING:
Issue #1:
Jurisdiction over the persons of both defendants was validly acquired
because personal service of summons, via tender to petitioner Sandra
Manuel, was made by Sheriff Joselito Sales. The sheriff’s return on
summons indicated that Sheriff Joselito Sales endeavored to personally
hand the summons and a copy of the complaint to the Spouses Manuel on
two (2) separate occasions.
The Spouses Manuel did not deny the occurrence of the events narrated
in the sheriff’s return but claimed that no valid service of summons was
made. The Spouses Manuel cannot capitalize on the supposed variance of
address. Personal service of summons has nothing to do with the location
where summons is served. A defendant’s address is inconsequential.
Topical: the Spouses Manuel’s self-serving assertion must crumble in the
face of the clear declarations in the sheriff’s return. The acts of Sheriff
Joselito Sales and the events relating to the attempt to personally hand the
summons and a copy of the complaint to the Spouses Manuel, as detailed
in the sheriff’s return, enjoy the presumption of regularity. Moreover,
Sheriff Joselito Sales must be presumed to have taken ordinary care and
diligence in carrying out his duty to make service upon the proper
person(s) and not upon an impostor.
A sheriff’s return, if complete on its face, must be accorded the
presumption of regularity and, hence, taken to be an accurate and
exhaustive recital of the circumstances relating to the steps undertaken by
a sheriff. In this case, the Spouses Manuel have harped on their (self-
serving) claim of maintaining residence elsewhere but failed to even

89
allege that there was anything irregular about the sheriff’s return or that it
was otherwise incomplete.

Issue #2: The requisites for declaring a party in default were satisfied by
respondent Ong.
1) the claiming party must file a motion asking the court to declare the
defending party in default;
2) the defending party must be notified of the motion to declare him in
default;
3) the claiming party must prove that the defending party has failed to
answer within the period provided by the Rule."
It is not disputed that Ong filed a motion to declare the Spouses Manuel
in default. It is also not disputed that the latter filed their answer after the
fifteen-day period had lapsed. It is similarly settled that the Spouses
Manuel were notified that a motion to declare them in default had been
filed.
Not only were the requisites for declaring a party in default satisfied, the
Spouses Manuel’s motion to lift order of default was also shown to be
procedurally infirm. To lift the order of default, there are 3 requirements:
1.) the motion to lift order of default
2.) an affidavit showing the invoked ground - fraud, accident, mistake
or excusable negligence
3.) the party's meritorious defense or defenses

In this case, the Court of Appeals noted that the Spouses Manuel’s motion
to lift order of default was not made under oath. We add that this motion
was not accompanied by an affidavit of merit specifying the facts which
would show that their non-filing of an answer within fifteen (15) days
from March 16, 2010 was due to fraud, accident, mistake, or excusable
negligence.
Failing both in making their motion under oath and in attaching an
affidavit of merits, the Spouses Manuel’s motion to lift order of default
must be deemed pro-forma. It is not even worthy of consideration

90
 CARLOS A. LORIA V. LUDOLFO MUÑOZ

G.R. No. 187240

October 15, 2014

J. Leonen

DOCTRINE:
No person should unjustly enrich himself or herself at the expense of another.

The principle of unjust enrichment has two conditions. First, a person must have
been benefited without a real or valid basis or justification. Second, the benefit
was derived at another person's expense or damage.

FACTS:

Ludolfo P. Muñoz, Jr. (Muñoz) filed a complaint for sum of money

and damages with an application for issuance of a writ of preliminary
attachment against Carlos A. Loria (Loria) with the Regional Trial Court
of Legazpi City.

In his complaint, Muñoz alleged that he has been engaged in construction

under the name, "Ludolfo P. Muñoz, Jr. Construction." In August 2000,
Loria visited Muñoz in his office in Doña Maria Subdivision in Daraga,
Albay. He invited Muñoz to advance P2,000,000.00 for... a subcontract of
a P50,000,000.00 river-dredging project in Guinobatan

Loria represented that he would make arrangements such that Elizaldy

Co, owner of Sunwest Construction and Development Corporation,
would turn out to be the lowest bidder for the project. Elizaldy Co would
pay P8,000,000.00 to ensure the project's award to Sunwest.

After the award to Sunwest, Sunwest would subcontract 20% or

P10,000,000.00 worth of the project to Muñoz.

91
The project to dredge the Masarawag and San Francisco Rivers in
Guinobatan was subjected to public bidding. The project was awarded to
the lowest bidder, Sunwest Construction and Development Corporation.
Sunwest allegedly finished dredging the Masarawag and San Francisco
Rivers without subcontracting Muñoz. With the project allegedly
finished, Muñoz demanded Loria to return his P2,000,000.00. Loria,
however, did not return the... money.

Muñoz first charged Loria and Elizaldy Co with estafa. This criminal case
was dismissed by the Municipal Trial Court of Daraga, Albay for lack of
probable cause.
Muñoz then filed the complaint for sum of money.

As the trial and appellate courts found, Muñoz paid Loria P2,000,000.00
for a subcontract of a government... project. The parties' agreement,
therefore, was void for being contrary to law, specifically, the Anti-Graft
and Corrupt Practices Act, the Revised Penal Code, and Section 6 of
Presidential Decree No. 1594. The agreement was likewise contrary to the
public policy of... public or open competitive bidding of government
contracts.

Since the parties' agreement was void, Loria argues that the parties were
in pari delicto, and Muñoz should not be allowed to recover the money he
gave under the contract.

ISSUES:
Whether Loria is liable to Muñoz for P2,000,000.00

Whether Loria initially obtained P3,000,000.00 from a certain Grace delos

Santos

Whether Loria is liable for P2,000,000.00 to Muñoz

RULING:
We rule for Muñoz and deny Loria's petition for review on certiorari.

92
Loria must return Munoz's P2,000,000.00... under the principle of unjust
enrichment

Under Article 22 of the Civil Code of the Philippines, "every person who
through an act of performance by another, or any other means, acquires
or comes into possession of something at the expense of the latter without
just or legal ground, shall return the same to him."

There is unjust enrichment "when a person unjustly retains a benefit to

the loss of another, or when a person retains money or property of
another against the fundamental principles of justice, equity and good
conscience.

In this case, Loria received P2,000,000.00 from Muñoz for a subcontract of

a government project to dredge the Masarawag and San Francisco Rivers
in Guinobatan, Albay. However, contrary to the parties' agreement,
Muñoz was not subcontracted for the project. Nevertheless,... Loria
retained the P2,000,000.00.

"the application of the doctrine of in pari delicto is not always rigid."[70]

An exception to the doctrine is "when its application... contravenes well-
established public policy."[71] In Gonzalo, this court ruled that "the
prevention of unjust enrichment is a recognized public policy of the
State."[72] It is, therefore, an exception to the... application of the in pari
delicto doctrine. This court explained:... public policy has been defined as
"that principle of the law... which holds that no subject or citizen can
lawfully do that which has a tendency to be injurious to the public or
against the public good."

In this case, both the trial and appellate courts found that Loria received
P2,000,000.00 from Muñoz for a subcontract of the river-dredging project.
Loria never denied that he failed to fulfill his agreement with Muñoz.
Throughout the case's proceedings, Loria... failed to justify why he has the
right to retain Muñoz's P2,000,000.00. As the Court of Appeals ruled, "it
was not shown that [Muñoz] benefited from the delivery of the amount of
P2,000,000.00 to [Loria].

93
 REMIGIO D. ESPIRITU v. LUTGARDA TORRES DEL ROSARIO

GR No. 204964

Oct 15, 2014

LEONEN, J.
DOCTRINE:
In administrative proceedings, procedural due process has been recognized to
include the following: (1) the right to actual or constructive notice of the
institution of proceedings which may affect a respondent's legal rights; (2) a real
opportunity to be heard personally or with the assistance of counsel, to present
witnesses and evidence in one's favor, and to defend one's rights; (3) a tribunal
vested with competent jurisdiction and so constituted as to afford a person
charged administratively a reasonable guarantee of honesty 'as well as
impartiality; and (4) a finding by said tribunal which is supported by substantial
evidence submitted for consideration during the hearing or contained in the
records or made known to the parties affected.

FACTS:
In 1978, the City Council of Angeles City, Pampanga, enacted
Zoning Ordinance No. 13, Series of 1978, classifying areas in Barangay
Margot and Barangay Sapang Bato, Angeles City, as agricultural land.
Respondent requested exemption which was granted by the City
Development Coordinator/Zoning Administrator, and the lots were
allegedly reclassified as non-agricultural or industrial lots.

On June 10, 1988, the Comprehensive Agrarian Reform Law (Republic Act
No. 6657) was enacted. Respondent filed for an application for exemption
from the coverage. Secretary of Agrarian Reform issued an order granting
such request.

94
Petitioners – who are farmers, sought reconsideration of the said order of
the Secretary. Hence, on June 15, 2006, then Secretary Pangandaman
issued an order granting the motion for reconsideration and revoking the
earlier order of then Secretary of Agrarian Reform Pagdanganan.

Respondent mentioned that the Order was sent to the wrong address.
Thus, Del Rosario alleged that she only came to know of the order on
January 26, 2007, when the Provincial Agrarian Reform Officer of
Pampanga handed her a copy of the order. Respondent filed an appeal to
the Office of the President – which was dismissed for lack of merit. Again,
Respondent filed for a Motion for Reconsideration which was denied.

Respondent filed an appeal before the CA – which was granted. The

Court of Appeals stated that del Rosario was indeed prevented from
participating in the proceedings that led to the issuance of Secretary
Pangandaman's order when the notices were sent to her other address on
record.

Petitioner sought to reverse the ruling of the CA. Petitioners argue that
respondent was not denied due process as she was able to actively
participate in the proceedings before the Department of Agrarian Reform
and the Office of the President.

ISSUE:
Whether or not the Respondents were denied of due process

RULING:
NO. The Respondents were not deprived of due process.

95
When respondent filed her motion for reconsideration assailing Secretary
Pangandaman's order, she was able to completely and exhaustively
present her arguments. The denial of her motion was on the basis of the
merits of her arguments and any other evidence she was able to present.
She was given a fair and reasonable opportunity to present her side;
hence, there was no deprivation of due process.

It was also erroneous to conclude that respondent was "denied her day in
the administrative proceedings below." Respondent was able to actively
participate not only in the proceedings before the Department of Agrarian
Reform, but also on appeal to the Office of the President and the Court of
Appeals.

96
 ROSARIO MATA CASTRO v. JOSE MARIA JED LEMUEL
GREGORIO

GR No. 188801

Oct 15, 2014

LEONEN, J.

DOCTRINE:
It is settled that "the jurisdiction of the court is determined by the statute in force
at the time of the commencement of the action.

FACTS:
This case stemmed out of the petition for adoption filed by Atty.
Jose Castro to legally adopt Jose Maria Jed Lemuel Gregorio (Jéd) and
Ana Maria Regina Gregorio (Regina). It was alleged that the said
adoption was obtained without the consent of the legitimate spouse and
child of the Respondent. In their petition, Rosario and Joanne allege that
they learned of the adoption sometime in 2005.[30] They allege that
Rosario's affidavit of consent, marked by the trial court as "Exh. K,"[31] was
fraudulent.

No notice was given by the trial court to Rosario and Joanne of the
adoption, the appellate court ruled that there is "no explicit provision in
the rules that the spouse and legitimate child of the adopter . . . should be
personally notified of the hearing."

The appellate court "abhor[red] the mind baffling scheme employed by

[Jose] in obtaining an adoption decree in favor of [his illegitimate
children] to the prejudice of the interests of his legitimate heirs"[36] but

97
stated that its hands were bound by the trial court decision that had
already attained "finality and immutability."

Petitioners also argue that the appellate court misunderstood and

misapplied the law on jurisdiction despite the denial of due process,
notice, and non-inclusion of indispensable parties.

They also argue that petitioners were not indispensable parties because
adoption is an action in rem and, as such, the only indispensable party is
the state.

ISSUE:
Whether the grant of adoption over respondents should be annulled as
the trial court did not validly acquire jurisdiction over the proceedings,
and the favorable decision was obtained through extrinsic fraud

RULING:
YES. The petitioners argue that they should have been given notice by the
trial court of the adoption, as adoption laws require their consent as a
requisite in the proceedings.

The petitioners are correct.

It is settled that "the jurisdiction of the court is determined by the

statute in force at the time of the commencement of the action."[55] As
Jose filed the petition for adoption on August 1, 2000, it is Republic Act
No. 8552[56] which applies over the proceedings. The law on adoption
requires that the adoption by the father of a child born out of wedlock
obtain not only the consent of his wife but also the consent of his
legitimate children.

98
For the adoption to be valid, petitioners' consent was required by
Republic Act No. 8552. Personal service of summons should have been
effected on the spouse and all legitimate children to ensure that their
substantive rights are protected. It is not enough to rely on constructive
notice as in this case. Surreptitious use of procedural technicalities cannot
be privileged over substantive statutory rights.

Since the trial court failed to personally serve notice on Rosario and
Joanne of the proceedings, it never validly acquired jurisdiction.

99
 ONOFRE ANDRES, et al v. PHILIPPINE NATIONAL BANK

G.R. No. 173548

October 15, 2014

LEONEN, J.

DOCTRINE:
This court is not a trier of facts that routinely re-examines evidence presented.
Factual findings by the Court of Appeals are, thus, generally considered binding
and conclusive upon this court.

FACTS:
This case involves a 4,634-square-meter parcel of land in Nueva Ecija
mortgaged to respondent Philippine National Bank (PNB). PNB later
foreclosed the property and consolidated title in its name. Petitioner
Onofre Andres, the uncle of mortgagors Reynaldo Andres and his wife,
Janette de Leon, filed a complaint for cancellation of title and
reconveyance of the property alleging that title in mortgagor's name was
based on a falsified document denominated as "Self-Adjudication of Sole
Heir."

The trial court ruled in favor of the Petitioners. On appeal before the CA,
Respondents interposed that it is an innocent mortgagee and in good
faith. It added that the findings of the Court of Appeals are binding and
conclusive before the Supreme Court. Petitioners assailed the factual
findings of the CA through a petition for review on certiorari.

ISSUE:
Whether the questions of facts may be entertained before the Supreme
Court

100
RULING:
NO.
A petition for review on certiorari shall raise only questions of law.63 The
core of the issues presented requires a determination of whether PNB was
in good faith and exercised due diligence in accepting the property
mortgaged by Spouses Reynaldo Andres and Janette de Leon. These are
questions of fact64 that fall outside the ambit of this court’s power of
review.
This court is not a trier of facts that routinely re-examines evidence
presented. Factual findings by the Court of Appeals are, thus, generally
considered binding and conclusive upon this court.65
The rule against entertaining factual questions admits of exceptions,66 but
none are present in this case. This court finds no reason to overturn the
findings of the Court of Appeals.

101
 RAMON CHING v. JOSEPH CHENG

GR No. 175507

Oct 08, 2014

LEONEN, J.

DOCTRINE:
Rule 17 of the Rules of Civil Procedure governs dismissals of actions at the
instance of the plaintiff. Hence, the "two-dismissal rule" under Rule 17, Section
1 of the Rules of Civil Procedure will not apply if the prior dismissal was done at
the instance of the defendant.

FACTS:
On October 7, 1998, Joseph Cheng, Jaime Cheng, and Mercedes Igne
(the Chengs) filed a complaint for declaration of nullity of titles against
Ramon Ching before the Regional Trial Court of Manila. This case was
docketed as Civil Case No. 98-91046 (the first case). On March 22, 1999,
the complaint was amended, with leave of court, to implead additional
defendants, including Po Wing Properties, of which Ramon Ching was a
primary stockholder.

Respondent filed a motion to dismiss for lack of jurisdiction over the

subject matter which was granted.

On 2002, a complaint was again filed against the Respondents. It was

raffled to Br 20 RTC Manila. When Branch 20 was made aware of the first
case, it issued an order transferring the case to Branch 6, considering that
the case before it involved substantially the same parties and causes
of action.

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 On November 11, 2002, the Chengs and Lucina Santos filed a motion to
dismiss their complaint in the second case, praying that it be dismissed
without prejudice. On November 22, 2002, Branch 6 issued an order
granting the motion to dismiss.

On December 9, 2002, Ramon Ching and Po Wing Properties filed a

motion for reconsideration of the order dated November 22, 2002. They
argue that the dismissal should have been with prejudice under the "two-
dismissal rule" of Rule 17, Section 1 of the 1997 Rules of Civil Procedure,
in view of the previous dismissal of the first case.

ISSUES:
I. Whether the trial court's dismissal of the second case operated as a
bar to the filing of a third case, as per the "two-dismissal rule"; and

II. Whether respondents committed forum shopping when they filed

the third case while the motion for reconsideration of the second case was
still pending

RULING:

On the two dismissal rule

The first section of the rule contemplates a situation where a plaintiff
requests the dismissal of the case before any responsive pleadings have
been filed by the defendant. It is done through notice by the plaintiff and
confirmation by the court. The dismissal is without prejudice unless
otherwise declared by the court.
The second section of the rule contemplates a situation where a
counterclaim has been pleaded by the defendant before the service on him
or her of the plaintiffs motion to dismiss. It requires leave of court, and
the dismissal is generally without prejudice unless otherwise declared by

103
the court.

The third section contemplates dismissals due to the fault of the plaintiff
such as the failure to prosecute. The case is dismissed either upon motion
of the defendant or by the court motu propio. Generally, the dismissal
is with prejudice unless otherwise declared by the court.

In all instances, Rule 17 governs dismissals at the instance of the plaintiff,

not of the defendant. Dismissals upon the instance of the defendant are
generally governed by Rule 16, which covers motions to dismiss.
As a general rule, dismissals under Section 1 of Rule 17 are without
prejudice except when it is the second time that the plaintiff caused its
dismissal. Accordingly, for a dismissal to operate as an adjudication upon
the merits, i.e, with prejudice to the re-filing of the same claim, the following
requisites must be present:

(1) There was a previous case that was dismissed by a competent court;
(2) Both cases were based on or include the same claim;
(3) Both notices for dismissal were filed by the plaintiff; and
(4) When the motion to dismiss filed by the plaintiff was consented to by the
defendant on the ground that the latter paid and satisfied all the claims of the
former.
The purpose of the "two-dismissal rule" is "to avoid vexatious
litigation."[73] When a complaint is dismissed a second time, the plaintiff is
now barred from seeking relief on the same claim.

On Forum Shopping
The rule on forum shopping will not strictly apply when it can be shown
that (1) the original case has been dismissed upon request of the plaintiff
for valid procedural reasons; (2) the only pending matter is a motion for
reconsideration; and (3) there are valid procedural reasons that serve the
goal of substantial justice for the fresh new case to proceed.

104
 PEOPLE OF THE PHILIPPINES vs. GARRY DELA CRUZ y DE
GUZMAN
G.R. No. 205821
October 1, 2014
LEONEN, J.:
DOCTRINE:

The significance of complying with Section 21’s requirements cannot be

overemphasized. Non-compliance is tantamount to failure in establishing identity
of corpus delicti, an essential element of the offenses of illegal sale and illegal
possession of dangerous drugs. By failing to establish an element of these offenses,
non-compliance will, thus, engender the acquittal of an accused.

FACTS:
On September 15, 2004, accused-appellant Garry dela Cruz (dela
Cruz) was charged with illegal sale and illegal possession of dangerous
drugs in two separate informations. The prosecution alleged that, dela
Cruz was arrested in a buy-bust operation. It was agreed that "PO1
Bobon would remove his bull cap once the sale of illegal drugs was
[consummated]." The buy-bust team prepared a _100.00 bill with serial
number KM 776896 as marked money.

At around 11:00 a.m. of September 14, 2004, the buy-bust operation team,
accompanied by the informant, went to the target area. The informant
initially brokered the sale of shabu. It was PO1 Bobon who handed the
marked money to dela Cruz in exchange for one (1) heat-sealed plastic
sachet of suspected shabu. After which, he removed his bull cap. SPO1
Roca then arrested dela Cruz.

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Upon frisking dela Cruz, PO1 Bobon supposedly recovered six (6) more
heat-sealed sachets of suspected shabu. PO1 Bobon placed the sachet he
purchased from dela Cruz in his right pocket and the six (6) other sachets
in his left pocket. SPO1 Roca recovered the marked _100.00 bill.

For his defense, the accused as he was leaving the comfort room, someone
embraced him from behind, while another poked a gun at him. He was
then handcuffed and brought to an L-300 van which was parked in front
of Food Mart. Inside the van, he was asked if he was Jing-Jong, alias Jong-
Jong. Despite his denials, he was brought to the police station. It was
when he was already detained that he learned that he was charged for
violation of the Comprehensive Dangerous Drugs Act of 2002.

RTC convicted him of the crime charged. The CA affirmed the RTC
ruling. Thereafter, dela Cruz filed his notice of appeal.

ISSUE:
Whether the prosecution was able to establish compliance with the chain
of custody requirements under Section 21 of the Comprehensive
Dangerous Drugs Act of 2002

RULING:

NO. The elements that must be established to sustain convictions for

illegal sale and illegal possession of dangerous drugs are settled:

In actions involving the illegal sale of dangerous drugs, the following

elements must first be established: (1) proof that the transaction or sale
took place and (2) the presentation in court of the corpus delicti or the
illicit drug as evidence.

106
On the other hand, in prosecutions for illegal possession of a dangerous
drug, it must be shown that (1) the accused was in possession of an item
or an object identified to be a prohibited or regulated drug, (2) such
possession is not authorized by law, and (3) the accused was freely and
consciously aware of being in possession of the drug. Similarly, in this
case, the evidence of the corpus delicti must be established beyond
reasonable doubt.21

The significance of complying with Section 21’s requirements cannot be

overemphasized. Non-compliance is tantamount to failure in establishing
identity of corpus delicti, an essential element of the offenses of illegal
sale and illegal possession of dangerous drugs. By failing to establish an
element of these offenses, non-compliance will, thus, engender the
acquittal of an accused.

107
 NATIONAL CORPORATION v. CITY OF CABANATUAN
GR No. 177332
Oct 01, 2014
LEONEN, J.
DOCTRINE:
It is a fundamental rule that the execution cannot be wider in scope or exceed the
judgment or decision on which it is based; otherwise, it has no validity.[42] "It is
the final judgment that determines and stands as the source of the rights and
obligations of the parties."

FACTS:
The City of Cabanatuan (the City) assessed the National Power
Corporation (NAPOCOR) a franchise tax amounting to P808,606.41,
representing 75% of 1% of its gross receipts for 1992. NAPOCOR refused
to pay, arguing that it is exempt from paying the franchise
tax.[5] Consequently, on November 9, 1993, the City filed a
complaint[6] before the Regional Trial Court of Cabanatuan City,
demanding NAPOCOR to pay the assessed tax due plus 25% surcharge
and interest of 2% per month of the unpaid tax, and costs of suit.

In the order[7] dated January 25, 1996, the trial court declared that the City
could not impose a franchise tax on NAPOCOR and accordingly
dismissed the complaint for lack of merit. In the March 12, 2001
decision[8] of the Court of Appeals (Eighth Division) in CA-G.R. CV No.
53297, the appellate court reversed the trial court and found NAPOCOR
liable to pay franchise tax.

After the court's decision had become final, the City filed with the trial
court a motion for execution[12] dated December 1, 2003 to collect the sum
of P24,030,565.26[13] (inclusive of the 25% surcharge of P13,744,096.69).

108
On October 25, 2004, the trial court issued the order[23] resolving the
pending motions filed by the City and NAPOCOR's corresponding
comments. The trial court agreed with NAPOCOR that "the tenor of the
decision [sought to be executed] limits the franchise tax payable on gross
receipts from sales to [the City's] electric cooperative."[24] However, the
trial court sustained the City's computation of the surcharge totalling
P13,744,096.69 over NAPOCOR's claim of P2,571,617.14 only.[25]

NAPOCOR assailed the trial court's order dated October 25, 2004 through
a petition for certiorari[26] with the Court of Appeals.

ISSUE:
Whether the order of execution exceeded the judgment sought to be
executed

RULING:
YES. Respondent's computation of the surcharge, as sustained by the trial
court and the Court of Appeals, varies the terms of the judgment sought
to be executed and contravenes Section 168 of the Local Government
Code.

In effect, respondent's computation resulted in the imposition of the 25%o

surcharge for every year of default in the payment of a franchise tax. To
illustrate, the surcharge for the 1992 franchise tax is 25% of P808,606.41
[proper tax due] multiplied by 11 years [1992 to 2002]; for the 1993
franchise tax, 25% of P821,401.17 [proper tax due] multiplied by 10 years
[1993 to 2002]; for the 1994 franchise tax, 25% of P1,075,855.62 [proper tax
due] multiplied by 9 years [1994 to 2002]; and so on.

It is a fundamental rule that the execution cannot be wider in scope or

exceed the judgment or decision on which it is based; otherwise, it has no

109
validity.[42] "It is the final judgment that determines and stands as the
source of the rights and obligations of the parties."

It is the final judgment that determines and stands as the source of the
rights and obligations of the parties. The judgment in this case made no
pronouncement as to the payment of surcharge and interest, but
specifically stated the amount for the payment of which respondents were
liable. The Collector by virtue of the writ of execution, may not vary the
terms of the judgment by including in his motion for execution the
payment of surcharge and interest.

110
 CELERINA J. SANTOS v. RICARDO T. SANTOS
G.R. No. 187061
October 08, 2014
Leonen, J.

DOCTRINE:
Annulment of judgment is the remedy when the RTC’s judgment, order, or
resolution has become final, and the “remedies of new trial, appeal, petition for
relief (or other appropriate remedies) are no longer available through no fault of
the petitioner.

FACTS:
On July 27, 2007, the Regional Trial Court of Tarlac City declared
petitioner Celerina J. Santos (Celerina) presumptively dead after her
husband, respondent Ricardo T. Santos (Ricardo), had filed a petition for
declaration of absence or presumptive death for the purpose of
remarriage on June 15, 2007.Ricardo remarried on September 17, 2008.
Ricardo claimed that it was almost 12 years from the date of his Regional
Trial Court petition since Celerina left. He believed that she had passed
away. Celerina claimed that she learned about Ricardo's petition only
sometime in October 2008 when she could no longer avail the remedies of
new trial, appeal, petition for relief, or other appropriate remedies.
On November 17, 2008, Celerina filed a petition for annulment of
judgment before the Court of Appeals on the grounds of extrinsic fraud
and lack of jurisdiction. She argued that she was deprived her day in
court when Ricardo, despite his knowledge of her true residence,
misrepresented to the court that she was a resident of Tarlac City.
According to Celerina, her true residence was in Neptune Extension,
Congressional Avenue, Quezon City. This residence had been her and
Ricardo's conjugal dwelling since 1989 until Ricardo left in May 2008.
CA: Issued the resolution dated November 28, 2008, dismissing Celerina's
petition for annulment of judgment for being a wrong mode of remedy.
According to the Court of Appeals, the proper remedy was to file a sworn
statement before the civil registry, declaring her reappearance in
accordance with Article 42 of the Family Code.
Hence, this petition was filed.

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ISSUE:

Whether the Court of Appeals erred in dismissing Celerina's petition for

annulment of judgment for being a wrong remedy for a fraudulently
obtained judgment declaring presumptive death.

RULING:

The petition is meritorious. Annulment of judgment is the remedy when

the Regional Trial Court's judgment, order, or resolution has become
final, and the "remedies of new trial, appeal, petition for relief (or other
appropriate remedies) are no longer available through no fault of the
petitioner.”
The grounds for annulment of judgment are extrinsic fraud and lack of
jurisdiction

Celerina alleged in her petition for annulment of judgment that there was
fraud when Ricardo deliberately made false allegations in the court with
respect to her residence.40 Ricardo also falsely claimed that she was
absent for 12 years. There was also no publication of the notice of hearing
of Ricardo's petition in a newspaper of general circulation. Celerina
claimed that because of these, she was deprived of notice and opportunity
to oppose Ricardo's petition to declare her presumptively dead.

Celerina alleged that all the facts supporting Ricardo's petition for
declaration of presumptive death were false. Celerina further claimed that
the court did not acquire jurisdiction because the Office of the Solicitor
General and the Provincial Prosecutor's Office were not given copies of
Ricardo's petition.

These are allegations of extrinsic fraud and lack of jurisdiction. Celerina

alleged in her petition with the Court of Appeals sufficient ground/s for
annulment of judgment.

Celerina filed her petition for annulment of judgment on November 17,

2008. This was less than two years from the July 27, 2007 decision

112
declaring her presumptively dead and about a month from her discovery
of the decision in October 2008. The petition was, therefore, filed within
the four-year period allowed by law in case of extrinsic fraud, and before
the action is barred by laches, which is the period allowed in case of lack
of jurisdiction.
There was also no other sufficient remedy available to Celerina at the time
of her discovery of the fraud perpetrated on her.

113
 STANLEY FINE FURNITURE, ELENAAND CARLOS WANG,
Petitioners, vs. VICTOR T. GALLANO AND ENRIQUITO SIAREZ,
Respondents
G.R. No.190486
November 26, 2014
Leonen, J.

DOCTRINE:
In reviewing a CA labor ruling under Rule 45 of the Rules of Court, the Court’s
review is limited to: ascertaining the correctness of the CA’s decision in finding
the presence or absence of a grave abuse of discretion. This is done by examining,
on the basis of the parties’ presentations, whether the CA correctly determined
that at the NLRC level, all the adduced pieces of evidence were considered; no
evidence which should not have been considered was considered; and the evidence
presented supports the NLRC findings; and deciding any other jurisdictional
error that attended the CA’s interpretation or application of the law.

FACTS:
Stanley Fine Furniture (Stanley Fine), through its owners Elena and
Carlos Wang, hired respondents Victor T. Gallano and Enriquito Siarez in
1995 as painters/carpenters. Victor and Enriquito each received 215.00
basic salary per day.
On May 26, 2005, Victor and Enriquito filed a labor complaint6 for
underpayment/non-payment of salaries, wages, Emergency Cost of
Living Allowance (ECOLA), and 13th month pay. They indicated in the
complaint form that they were "still working"7 for Stanley Fine.
Victor and Enriquito filed an amended complaint8 on May 31, 2005, for
actual illegal dismissal, underpayment/non-payment of overtime pay,
holiday pay, premium for holiday pay, service incentive leave pay, 13th
month pay, ECOLA, and Social Security System (SSS) benefit. In the
amended complaint, Victor and Enriquito claimed that they were
dismissed on May 26, 2005.9 Victor and Enriquito were allegedly scolded
for filing a complaint for money claims. Later on, they were not allowed
to work.
LA: found that Victor and Enriqui to were illegally dismissed.

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NLRC: Reversed the Labor Arbiter’s decision, ruling that the Labor
Arbiter erred in considering the statement, "due to the filing of an
unmeritorious labor case," as an admission against interest.
Thus, Victor and Enriquito filed a petition for certiorari before the Court
of Appeals.
Generally, petitions for certiorari are limited to the determination and
correction of grave abuse of discretion amounting to lack or excess of
jurisdiction. However, the Court of Appeals reviewed the findings of facts
and of law of the labor tribunals, considering that the Labor Arbiter and
the National Labor Relations Commission had different findings.
CA found that Stanley Fine failed to show any valid cause for Victor and
Enriquito’s termination and to comply with the two notice rule.22 Also,
the Court of Appeals noted that Stanley Fine’s statements — that it was
"forced to declare them dismissed" due to their absences and "due to the
filing of an unmeritorious labor case against it by the two complainants"
— were admission against interest and binding upon Stanley Fine.

ISSUES:
1. Whether petitioner has standing to file the case
2. Whether CA correctly determined the presence of grave abuse of
discretion on the part of the National Labor Relations Commission.

RULING:
1. Petitioner Elena Briones has standing to file this case On this issue,
petitioners claimed that Elena Briones is not the real party-in-interest;
hence, the decision of the Court of Appeals is final and executory since
the petition for review was not properly filed.
In her reply, Elena argued that she is the sole proprietor of Stanley Fine, a
fact known to respondents. As the sole proprietor, she has standing to file
this petition.

Respondents cannot deny Elena Briones’ standing to file this petition

considering that in their amended complaint filed before the Labor
Arbiter, they wrote "Stanley Fine Furniture, Elina [sic] Briones Wang as
owner and Carlos Wang" as their employers.

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Also, respondents did not refute Elena’s allegation that Stanley Fine is a
sole proprietorship. In Excellent Quality Apparel, Inc. v. Win Multi-Rich
Builders, Inc. this court stated that:
A sole proprietorship does not possess a juridical personality separate
and distinct from the personality of the owner of the enterprise.
Thus, Stanley Fine, being a sole proprietorship, does not have a
personality separate and distinct from its owner, Elena Briones. Elena,
being the proprietress of Stanley Fine, can be considered as a real party-
in-interest and has standing to file this petition for review.

2. Review of procedural parameters

In her petition for review, Elena raised the following issues: (a) whether
"the filing of an Establishment Termination Report"56 is an act of
dismissal; (b) whether counsel’s allegation that an employee was
dismissed due to the filing of an "unmeritorious" case against the
employer is binding;57 (c) whether a Labor Arbiter can award monetary
claims based on the allegations in the complaint form;58 and (d) whether
the award of moral and exemplary damages and attorney’s fees is proper
even without supporting evidence.

In a Rule 45 petition for review of a Court of Appeals decision rendered

under Rule 65, this court is guided by the following rules:
[I]n a Rule 45 review (of the CA decision rendered under Rule 65), the
question of law that confronts the Court is the legal correctness of the CA
decision – i.e., whether the CA correctly determined the presence or
absence of grave abuse of discretion in the NLRC decision before it, and
not on the basis of whether the NLRC decision on the merits of the case
was correct. Specifically, in reviewing a CA labor ruling under Rule 45 of
the Rules of Court, the Court’s review is limited to:
(1) Ascertaining the correctness of the CA’s decision in finding the
presence or absence of a grave abuse of discretion. This is done by
examining, on the basis of the parties’ presentations, whether the CA
correctly determined that at the NLRC level, all the adduced pieces of
evidence were considered; no evidence which should not have been
considered was considered; and the evidence presented supports the
NLRC findings; and

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(2) Deciding any other jurisdictional error that attended the CA’s
interpretation or application of the law.
Nevertheless, in this case, Elena failed to pinpoint the overt acts of
respondents that show they had abandoned their work. There was a mere
allegation that she was "forced to declare them dismissed due to their
failure to report back to work for a considerable length of time" but no
evidence to prove the intent to abandon work. It is the burden of the
employer to prove that the employee was not dismissed or, if dismissed,
that such dismissal was not illegal. Unfortunately for Elena, she failed to
do so.

117
 AURORA N. DE PEDRO vs. ROMASAN DEVELOPMENT
CORPORATION
G.R. No. 194751
November 26, 2014
Leonen, J.

DOCTRINE:
Regardless of the type of action - whether it is in personam, in rem or quasi in
rem - the preferred mode of service of summons is personal service. To avail
themselves of substituted service, courts must rely on a detailed enumeration of
the sheriff's actions and a showing that the defendant cannot be served despite
diligent and reasonable efforts. The sheriff's return, which contains these details,
is entitled to a presumption of regularity, and on this basis, the court may allow
substituted service. Should the sheriff's return be wanting of these details,
substituted service will be irregular if no other evidence of the efforts to serve
summons was presented. Failure to serve summons will mean that the court
failed to acquire jurisdiction over the person of the defendant. However, the filing
of a motion for new trial or reconsideration is tantamount to voluntary
appearance.

FACTS:
Respondent Romasan Development Corporation alleged in its
complaints that it was the owner and possessor of a parcel of land in
Antipolo City. The land was covered by Transfer Certificate of Title (TCT)
No. 236044.
Respondent further alleged in its separate complaints that the
government could not legally issue the free patents because at the time of
their issuance, the land was already released for disposition to private
individuals. OCT No. 438, from which respondent’s TCT No. 236044
originated, was already issued as early as August 30, 1937.
Respondent also prayed for the payment of attorney’s fees and exemplary
damages.
Attempts to personally serve summons on De Pedro failed. The officer’s
return, dated February 22, 1999 reads in part:
OFFICER’S RETURN
I HEREBY CERTIFY that on the 15th and 18th day of February, 1999, I
have served a copy of the summons with complaint and annexes dated

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January 29, 1999 issued by Regional Trial Court, Fourth Judicial Region,
Branch 74, Antipolo City upon defendants in the above-entitled case on
the following, to wit;
1. AURORA N. DE PEDRO – Unserved for the reason that according to
the messenger of Post Office of Pasig their [sic] is no person in the said
given address.
Respondent filed a motion to serve summons and the complaint by
publication.
RTC: Granted the motion. The summons and the complaint were
published in People’s Balita on its April 24, May 1, and May 8, 1998
issues.
RESPONDENT moved to declare all defendants in its complaints,
including De Pedro, in default for failure to file their answers.
Respondent also moved to be allowed to present evidence ex parte.
RTC: granted the motions on August 19, 1999.
RTC: Issued an order declaring as nullity the titles and free patents issued
to all defendants in respondent’s complaint, including the free patent
issued to De Pedro.
CA: Denied the petition for certiorari for lack of merit, and affirmed the
denial of De Pedro’s motion for new trial.
PETITIONER argues that respondent’s prayer for attorney’s fees,
appearance fees, exemplary damages, and costs of suit sought to establish
personal obligations upon petitioner in favor of respondent. Hence, an
action in personam which required personal service upon her for the
court’s acquisition of jurisdiction over her person.
Improper service of summons rendered the trial court decision null and
void. It means that the court could not acquire jurisdiction over the
person of petitioner.
Complaints were dismissible on the ground of litis pendentia, pointing to
the alleged pending case between the same parties and involving same
subject matter at the time when respondent filed its complaint before the
Regional Trial Court in 1998. The alleged pending case was filed in 1997
by petitioner and her spouse against respondent, seeking "enforce[ment]
of their rights as owners, and claim[ing] damages for the unlawful and
illegal acts of dispossession, terrorism and violence which they, their
family and their close relatives were subjected to by [respondent]."

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RESPONDENT argues that the process server tried other forms of
substituted service, including service by registered mail.

ISSUES:
1. Whether the trial court decision was void for failure of the trial court to
acquire jurisdiction over the person of petitioner Aurora N. De Pedro; and
2. Whether filing a motion for new trial and petition for certiorari is a bar
from filing a petition for annulment of judgment.

RULING:
1. The sheriff’s return must show the details of the efforts exerted to
personally serve summons upon defendants or respondents, before
substituted service or service by publication is availed.
Courts may exercise their powers validly and with binding effect if they
acquire jurisdiction over: (a) the cause of action or the subject matter of
the case; (b) the thing or the res; (c) the parties; and (d) the remedy.
Jurisdiction over the subject matter refers to the power or authority of
courts to hear and decide cases of a general class. It is conferred by the
Constitution or by law. It is not acquired through administrative
issuances or court orders. It is not acquired by agreement, stipulation,
waiver, or silence. Any decision by a court, without a law vesting
jurisdiction upon such court, is void.

Jurisdiction over the thing or res is the power of the court over an object
or thing being litigated. The court may acquire jurisdiction over the thing
by actually or constructively seizing or placing it under the court’s
custody.
Jurisdiction over the parties refers to the power of the court to make
decisions that are binding on persons. The courts acquire jurisdiction over
complainants or petitioners as soon as they file their complaints or
petitions. Over the persons of defendants or respondents, courts acquire
jurisdiction by a valid service of summons or through their voluntary
submission. Generally, a person voluntarily submits tothe court’s
jurisdiction when he or she participates in the trial despite improper
service of summons. Courts and litigants must be aware of the limits and

120
the requirements for the acquisition of court jurisdiction. Decisions or
orders issued by courts outside their jurisdiction are void. Complaints or
petitions filed before the wrong court or without acquiring jurisdiction
over the parties may be dismissed.

Petitioner argued that the trial court did not acquire jurisdiction over her
person because she was not properly served with summons. After the
summons had returned unserved to petitioner because "there [was] no
person in the said given address,"81 the trial court allowed the
publication of the summons to petitioner. Jurisdiction over the parties is
required regardless of the type of action — whether the action is in
personam, in rem, or quasi in rem.

In actions in personam, the judgment is for or against a person directly.

Jurisdiction over the parties is required in actions in personam because
they seek to impose personal responsibility or liability upon a person.
Courts need not acquire jurisdiction over parties on this basis in in rem
and quasi in rem actions. Actions in rem or quasi in rem are not directed
against the person based on his or her personal liability.

Actions in rem are actions against the thing itself. They are binding upon
the whole world. Quasi in rem actions are actions involving the status of a
property over which a party has interest. Quasi in rem actions are not
binding upon the whole world. They affect only the interests of the
particular parties. However, to satisfy the requirements of due process,
jurisdiction over the parties in in rem and quasi in rem actions is required.
The phrase, "against the thing," to describe in rem actions is a metaphor. It
is not the "thing" that is the party to an in rem action; only legal or natural
persons may be parties even in in rem actions. "Against the thing" means
that resolution of the case affects interests of others whether direct or
indirect. It also assumes that the interests — in the form of rights or duties
— attach to the thing which is the subject matter of litigation. In actions in
rem, our procedure assumes an active vinculum over those with interests
to the thing subject of litigation.

Due process requires that those with interest to the thing in litigation be
notified and given an opportunity to defend those interests. Courts, as

121
guardians of constitutional rights, cannot be expected to deny persons
their due process rights while at the same time be considered as acting
within their jurisdiction.

Violation of due process rights is a jurisdictional defect. This court

recognized this principle in Aducayen v. Flores. In the same case, this
court further ruled that this jurisdictional defect is remedied by a petition
for certiorari.

An action for annulment of certificate of title is quasi in rem. It is not an

action "against a person on the basis of his personal liability," but an
action that subjects a person’s interest over a property to a burden. The
action for annulment of a certificate of title threatens petitioner’s interest
in the property. Petitioner is entitled to due process with respect to that
interest. The court does not have competence or authority to proceed with
an action for annulment of certificate of title without giving the person, in
whose name the certificate was issuedall the opportunities to be heard.

Hence, regardless of the nature of the action, proper service of summons

is imperative. A decision rendered without proper service of summons
suffers a defect in jurisdiction. Respondent’s institution of a proceeding
for annulment of petitioner’s certificate of title is sufficient to vest the
court with jurisdiction over the res, but it is not sufficient for the court to
proceed with the case with authority and competence. Personal service of
summons is the preferred mode of service of summons. Thus, as a rule,
summons must be served personally upon the defendant or respondent
wherever he or she may be found. If the defendant or respondent refuses
to receive the summons, it shall be tendered to him or her.

If the defendant or respondent is a domestic juridical person, personal

service of summons shall be effected upon its president, managing
partner, general manager, corporate secretary, treasurer, or in-house
counsel wherever he or she may be found. Other modes of serving
summons may be done when justified. Service of summons through other
modes will not be effective without showing serious attempts to serve
summons through personal service. Thus, the rules allow summons to be
served by substituted service only for justifiable causes and if the

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defendant or respondent cannot be served within reasonable time.98
Substituted service is effected "(a) by leaving copies of the summons at
the defendant’s residence with some person of suitable age and discretion
then residing therein,or (b) by leaving the copies at defendant’s office or
regular place of business with some competent person in charge thereof."
Service of summons by publication in a newspaper of general circulation
is allowed when the: defendant or respondent is designated as an
unknown owner or if his or her whereabouts are "unknown and cannot be
ascertained by diligent inquiry.”

It may only be effected after unsuccessful attempts to serve the summons

personally, and after diligent inquiry as to the defendant’s or
respondent’s whereabouts.

Service of summons by extra territorial service is allowed after leave of

court when the defendant or respondent does not reside or is not found in
the country or is temporarily out of the country.
If a defendant or respondent voluntarily appears in trial or participates in
the proceedings, it is generally construed as sufficient service of
summons.

In this case, summons was served by publication.

A look into the content of the sheriff’s return will determine if the
circumstances warranted the deviation from the rule preferring personal
service of summons over other modes of service. The sheriff’s return must
contain a narration of the circumstances showing efforts to personally
serve summons to the defendants or respondents and the impossibility of
personal service of summons.

A sheriff’s return enjoys the presumption of regularity in its issuance if it

contains the details of the circumstances surrounding the sheriff’s attempt
to serve the summons personally upon the defendants or respondents;
and the particulars showing the impossibility of serving the summons
within reasonable time.107 It does not enjoy the presumption of
regularity if the return was merely pro forma.
Failure to state the facts and circumstances that rendered service of
summons impossible renders service of summons and the return

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ineffective. In that case, no substituted service or service by publication
can be valid.

In this case, the sheriff’s return states:

OFFICER’S RETURN I HEREBY CERTIFY that on the 15th and 18th day
of February, 1999, I have served a copy of the summons with complaint
and annexes dated January 29, 1999 issued by Regional Trial Court,
Fourth Judicial Region, Branch 74, Antipolo City upon defendants in the
above-entitled case on the following, to wit;
1. AURORA N. DE PEDRO – Unserved for the reason that according to
the messenger of Post Office of Pasig their [sic] is no person in the said
given address.

This return shows no detail of the sheriff’s efforts to serve the summons
personally upon petitioner. The summons was unserved only because the
post office messenger stated that there was no "Aurora N. De Pedro" in
the service address. The return did not show that the sheriff attempted to
locate petitioner’s whereabouts. Moreover, it cannot be concluded based
on the return that personal service was rendered impossible under the
circumstances or that service could no longer be made within reasonable
time.

The lack of any demonstration of effort on the part of the sheriff to serve
the summons personally upon petitioner is a deviation from this court’s
previous rulings that personal service is the preferred mode of service,
and that the sheriff must narrate in his or her return the efforts made to
effect personal service. Thus, the sheriff’s return in this case was defective.
No substituted service or service by publication will be allowed based on
such defective return.

The issuance of a judgment without proper service of summons is a

violation of due process rights. The judgment, therefore, suffers a
jurisdictional defect. The case would have been dismissible had petitioner
learned about the case while trial was pending. At that time, a motion to
dismiss would have been proper. After the trial, the case would have been
the proper subject of an action for annulment of judgment.

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Petitioner learned about the action for annulment of title only after trial.
Instead of filing an action for annulment of judgment, however, she filed
a motion for new trial without alleging any proper ground. Rule 37 of the
Rules of Court provides that a party may move and the court may grant a
new trial based on the following causes:
Fraud, accident, mistake or excusable negligence which ordinary
prudence could not have guarded against and by reason of which such
aggrieved party has probably been impaired in his rights; or Newly
discovered evidence, which he could not, with reasonable diligence, have
discovered and produced at the trial, and which if presented would
probably alter the result.

Petitioner insisted in her motion for new trial that the trial court did not
acquire jurisdiction over her person. She did not allege that fraud,
accident, mistake, or excusable negligence impaired her rights. Neither
did she allege that she found newly discovered evidence that could have
altered the trial court decision. When her motion for new trial was denied,
she filed a petition for certiorari, insisting that her motion for new trial
should have been granted on the ground of lack of jurisdiction over her
person.
The Court of Appeals denied the petition for her failure to allege any
ground for new trial. We cannot attribute error on the part of the Court of
Appeals for this denial because, indeed, lack of jurisdiction is not a
ground for granting a new trial.

What cannot be denied is the fact that petitioner was already notified of
respondent’s action for annulment of petitioner’s title when she filed a
motion for new trial and, later, a petition for certiorari. At that time,
petitioner was deemed, for purposes of due process, to have been
properly notified of the action involving her title to the property. Lack of
jurisdiction could have already been raised in an action for annulment of
judgment.

Thus, when petitioner erroneously filed her motion for new trial and
petition for certiorari instead of an action for annulment of judgment, she
was deemed to have voluntarily participated in the proceedings against

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her title. The actions and remedies she chose to avail bound her.
Petitioner’s failure to file an action for annulment of judgment at this time
was fatal to her cause. We cannot conclude now that she was denied due
process.

2. Petitioner is already barred from filing a petition for annulment of

judgment A petition for annulment of judgment is a recourse that is
equitable in character. It is independent of the case and is "allowed only in
exceptional cases as where there is no available or other adequate
remedy." An action for annulment of judgment may be filed to assail
Regional Trial Court judgments when resort to other remedies can no
longer be had through no fault of petitioner.

However, this court had an occasion to say that an action for annulment
of judgment may not be invoked: where the party has availed himself of
the remedy of new trial, appeal, petition for relief, or other appropriate
remedy and lost; or where he has failed to avail himself of those remedies
through his own fault or negligence." Thus, an action for annulment of
judgment is not always readily available even if there are causes for
annulling a judgment.

In this case, petitioner’s main grounds for filing the action for annulment
are lack of jurisdiction over her person, and litis pendentia. These are the
same grounds that were raised in the motion for new trial filed before and
denied by the Regional Trial Court.

Applying the above rules, we rule that the Court of Appeals did not err in
denying petitioner’s petition for annulment of the Regional Trial Court’s
judgment. Petitioner had already filed a motion for new trial and petition
for certiorari invoking lack of jurisdiction as ground. Petitioner’s filing of
the petition for annulment of judgment after she had filed a motion for
new trial and lost, with both actions raising the same grounds, reveals an
intent to secure a judgment in her favor by abusing and making a
mockery of the legal remedies provided by law.

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This kind of abuse is what this court tries to guard against when it limited
its application, and stated in some of the cases that an action for
annulment of judgment cannot be invoked when other remedies had
already been availed. Thus, an action for annulment of judgment "will not
so easily and readily lend itself to abuse by parties aggrieved by final
judgments." Petitioner cannot abuse the court’s processes to revive a case
that has already been rendered final against her favor, for the purpose of
securing a favorable judgment. An action for annulment of judgment
cannot be used by petitioner who has lost her case through fault of her
own, to make "a complete farce of a duly promulgated decision that has
long become final and executory.”

III. The requisites of litis pendentia are not satisfied when respondent filed its
action for annulment of title

Petitioner argued that the case for annulment of title was dismissible on
the ground of litis pendentia because there was a pending civil case filed
by her against respondent.

The requisites of litis pendentia are: identity of parties, or interests in both

actions; identity of rights asserted and relief prayed for, the relief being
founded on the same facts; and the identity of the two preceding
particulars is such that any judgment rendered in the other action, will,
regardless of which party is successful, amount to res judicata in the
action under consideration.
Although both cases involve the same parcel of land, petitioner was not
able to show that there was identity of the relief prayed for. A review of
the complaint in the said civil case shows that it was a case for damages,
for alleged improper conduct of respondent relating the property. The
action filed by respondent was an action for annulment of petitioner’s
title.
Petitioner was also not able to show that the relief prayed for in both cases
were founded on the same facts. Petitioner’s complaint for damages was
founded on the alleged misconduct of respondent. Respondent’s action
for annulment of title was founded on the alleged irregularity in the
issuance of petitioner’s title. Hence, the petitioner was not able to show

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that all the requisites for litis pendentia are present. Respondent’s action
for annulment of title cannot be dismissed on this ground.

IV. A certificate of title does not vest ownership

Petitioner argues that her certificate of title was erroneously declared null
and void because based on OCT No. P-691, she is the real owner of the
property.

It is true that certificates of title are indefeasible and binding upon the
whole world. However, certificates of title do not vest ownership.129
They merely evidence title or ownership of the property.130 Courts may,
therefore, cancel or declare a certificate of title null and void when it finds
that it was issued irregularly. In this case, the trial court ruled based on
the committee report that the free patents and original certificate of title
issued to petitioner were irregularly issued, and, therefore, invalid.

The principle of "bar by prior judgment" is embodied in Rule 39, Section

47(b) of the Rules of Court.
In this case, the trial court, by annulling petitioner’s certificate of title and
declaring its issuance irregular, directly adjudged petitioner’s certificate
of title as void. Because petitioner failed to appeal and cause the
annulment of the trial court’s judgment as to her title’s validity, this
question is already barred. This judgment has already attained finality
and can no longer be litigated. In any case, even if petitioner’s original
certificate of title was not irregularly issued as she claims, her original
certificate of title was issued later than the title from which respondent’s
title originated. As a rule, original titles issued earlier prevail over another
original title issued later.

128
 LG ELECTRONICS PHILIPPINES, INC., vs. COMMISSIONER OF
INTERNAL REVENUE
G.R. No. 165451
December 3, 2014
Leonen, J.

DOCTRINE:
The Supreme Court has said that, from the historical and statutory perspectives,
the Solicitor General is the "principal law officer and legal defender of the
government." The Legal Division of the Bureau of Internal Revenue should be
mindful of this procedural lapse in the future.

FACTS:
LG filed this Petition for Review on Certiorari assailing the decision
of Court of Tax Appeals in ruling that LG was liable for deficiency income
tax. On its Manifestation, LG stated that it availed itself of the tax amnesty
provided under RA No. 9480. In addition, the Bureau of Internal Revenue,
through Assistant Commissioner James Roldan, issued a ruling on
January 25, 2008, which held that petitioner complied with the provisions
of Republic Act No. 9480. Petitioner is, thus, entitled to the immunities
and privileges provided for under the law including "civil, criminal or
administrative penalties under the National Internal Revenue Code of
1997 xxxx arising from the failure to pay any and all internal revenue
taxes for taxable year 2005 and prior years."
Respondent’s counsel from BIR Revenue Region No. 7 Legal Division
argued that petitioner cannot avail itself of the tax amnesty program
under Republic Act No. 9480.

ISSUE:
Whether the Legal Division of Bureau of Internal Revenue is the proper
representative of respondent.

RULING:
Bureau of Internal Revenue Legal Division is not the proper
representative of respondent.
We observe that respondent is represented by a lawyer from the Legal
Division of Revenue Region No. 7 of the Bureau of Internal Revenue and

129
not by the Office of the Solicitor General. We are mindful of Section 220 of
Republic Act No. 8424 or the Tax Reform Act of 1997, which provides that
legal officers of the Bureau of Internal Revenue are the ones tasked to
institute the necessary civil or criminal proceedings on behalf of the
government:
Section 220. Form and Mode of Proceeding in Actions Arising
under this Code. – Civil and criminal actions and proceedings
instituted in behalf of the Government under the authority of
this Code or other law enforced by the Bureau of Internal
Revenue shall be brought in the name of the Government of the
Philippines and shall be conducted by legal officers of the
Bureau of Internal Revenue but no civil or criminal action for the
recovery of taxes or the enforcement of any fine, penalty or
forfeiture under this Code shall be filed in court without the
approval of the Commissioner.
Nonetheless, this court has previously ruled on the issue of the Bureau of
Internal Revenue’s representation in appellate proceedings, particularly
before this court:
The institution or commencement before a proper court of civil and
criminal actions and proceedings arising under the Tax Reform Act which
"shall be conducted by legal officers of the Bureau of Internal Revenue" is
not in dispute. An appeal from such court, however, is not a matter of
right. Section 220 of the Tax Reform Act must not be understood as
overturning the long established procedure before this Court in requiring
the Solicitor General to represent the interest of the Republic. This Court
continues to maintain that it is the Solicitor General who has the primary
responsibility to appear for the government in appellate proceedings. This
pronouncement finds justification in the various laws defining the Office
of the Solicitor General, beginning with Act No. 135, which took effect on
16 June 1901, up to the present Administrative Code of 1987. Section 35,
Chapter 12, Title III, Book IV, of the said Code outlines the powers and
functions of the Office of the Solicitor General which includes, but not
limited to, its duty to —
(1) Represent the Government in the Supreme Court and the Court of
Appeals in all criminal proceedings; represent the Government and its
officers in the Supreme Court, the Court of Appeals, and all other courts

130
or tribunals in all civil actions and special proceedings in which the
Government or any officer thereof in his official capacity is a party.
(2) Appear in any court in any action involving the validity of any treaty,
law, executive order or proclamation, rule or regulation when in his
judgment his intervention is necessary or when requested by the Court.
In Gonzales vs. Chavez, the Supreme Court has said that, from the
historical and statutory perspectives, the Solicitor General is the "principal
law officer and legal defender of the government." From the foregoing,
we find that the Office of the Solicitor General is the proper party to
represent the interests of the government through the Bureau of Internal
Revenue. The Legal Division of the Bureau of Internal Revenue should be
mindful of this procedural lapse in the future. However, records show
that the Office of the Solicitor General has been apprised of developments
in the case since the beginning of the proceedings. We, thus, rule that the
interests of the government have been duly protected.

131
 CITY OF LAPU-LAPU vs. PHILIPPINE ECONOMIC ZONE
AUTHORITY PROVINCE OF BATAAN, represented by GOVERNOR
ENRIQUE T. GARCIA, JR., and EMERLINDA S. TALENTO, in her
capacity as Provincial Treasurer of Bataan, Petitioners, vs. PHILIPPINE
ECONOMIC ZONE AUTHORITY, Respondent.
G.R. No. 187583 & G.R. No. 184203
2014
Leonen, J.

DOCTRINE:
Under the Rules of Court, there are three modes of appeal from Regional Trial
Court decisions. The first mode is through an ordinary appeal before the Court of
Appeals where the decision assailed was rendered in the exercise of the Regional
Trial Court’s original jurisdiction. Ordinary appeals are governed by Rule 41,
Sections 3 to 13 of the Rules of Court. In ordinary appeals, questions of fact or
mixed questions of fact and law may be raised. The second mode is through a
petition for review before the Court of Appeals where the decision assailed was
rendered by the Regional Trial Court in the exercise of its appellate jurisdiction.
Rule 42 of the Rules of Court governs petitions for review before the Court of
Appeals. In petitions for review under Rule 42, questions of fact, of law, or mixed
questions of fact and law may be raised. The third mode is through an appeal by
certiorari before this court under Rule 45 where only questions of law shall be
raised.

FACTS:

G.R. No. 184203

City of Lapu-Lapu, through the Office of the Treasurer, demanded

from the PEZA P33 million in real property taxes for the period from 1992
to 1998 on the PEZA’s properties located in the Mactan Economic Zone.
The City reiterated its demand in the letter, citing that Sections 193 and
234 of the Local Government Code of 1991 that withdrew the real
property tax exemptions previously granted to or presently enjoyed by all
persons. The City pointed out that no provision in the Special Economic
Zone Act of 1995 specifically exempted the PEZA from payment of real
property taxes, unlike Section 21 of Presidential Decree No. 66 that

132
explicitly provided for EPZA’s exemption. Since no legal provision
explicitly exempted the PEZA from payment of real property taxes, the
City argued that it can tax the PEZA.

The City made subsequent demands on the PEZA. In its last reminder in
2002, the City assessed the PEZA 86,843,503.48 as real property taxes for
the period, prompting PEZA to filed a petition for declaratory Relief with
the RTC Pasay, praying that the trial court declare it exempt from
payment of real property taxes. It granted the PEZA’s petition for
declaratory relief and declared it exempt from payment of real property
taxes.
The City then appealed to the Court of Appeals, but the Court dismissed
it outright, since the City availed itself of the wrong mode of appeal.
In its petition for review on certiorari with this court,41 the City argues
that the Court of Appeals "hid under the skirts of technical rules" in
resolving its appeal. The City maintains that its appeal involved mixed
questions of fact and law.

PEZA argues that the Court of Appeals’ decision had become final and
executory. After the Court of Appeals had denied the City’s appeal, the
City filed a motion for extension of time to file a motion for
reconsideration. Arguing that the time to file a motion for reconsideration
is not extendible, the PEZA filed its motion for reconsideration out of
time. The City has no more right to appeal to this court.
The PEZA maintains that the City availed itself of the wrong mode of
appeal before the Court of Appeals. Since the City raised pure questions
of law in its appeal, the PEZA argues that the proper remedy is a petition
for review on certiorari with this court, not an ordinary appeal before the
appellate court. The Court of Appeals, therefore, correctly dismissed
outright the City’s appeal under Rule 50, Section 2 of the Rules of Court.
As to the jurisdiction issue, the PEZA counters that the Regional Trial
Court of Pasay had jurisdiction to hear its petition for declaratory relief
under Rule 63, Section 1 of the Rules of Court. It also argued that it need
not implead the Province of Bataan, the City of Baguio, and the Province
of Cavite as respondents considering that their demands came after the
PEZA had already filed the petition in court.

133
G.R. No. 187583

After the City of Lapu-Lapu had demanded payment of real

property taxes from the PEZA, the Province of Bataan followed suit.
Province, through the Office of the Provincial Treasurer, informed the
PEZA that it would be sending a real property tax billing to the PEZA.
Arguing that the PEZA is a developer of economic zones, the Province
claimed that the PEZA is liable for real property taxes under Section 24 of
the Special Economic Zone Act of 1995. PEZA requested the Province to
suspend the service of the real property tax billing. It cited its petition for
declaratory relief against the City of Lapu-Lapu pending before the
Regional Trial Court, Branch 111, Pasay City as basis. The Province
argued that serving a real property tax billing on the PEZA "would not in
any way affect [its] petition for declaratory relief. Then, the Province
notified the PEZA of its real property tax liabilities for 1995 to 2002
totalling ₱110,549,032.55. The Province ignored the PEZA’s request and
served on the PEZA a statement of unpaid real property tax for the period
from 1995 to 2004. The PEZA again requested the Province to suspend
collecting its alleged real property taxes.

The Province denied the request in its letter, then served on the PEZA a
warrant of levy covering the PEZA’s real properties located in Bataan.
PEZA filed a petition for injunction before the RTC Pasay, arguing that it
is exempt from payment of real property taxes.

The trial court denied the PEZA’s petition for injunction. The trial court
ruled that the PEZA is not exempt from payment of real property taxes.
The PEZA filed before the Court of Appeals a petition for certiorari with
prayer for issuance of a temporary restraining order. The Court of
Appeals issued a temporary restraining order, enjoining the Province and
its Provincial Treasurer from selling PEZA's properties at public auction.
The PEZA then filed a supplemental petition for certiorari, prohibition,
and mandamus81 against the Province, arguing that the Provincial
Treasurer of Bataan acted with grave abuse of discretion in issuing the
notice of delinquency and notice of sale. It maintained that it is exempt

134
from payment of real property taxes because it is a government
instrumentality.

It added that its lands are property of public dominion which cannot be
sold at public auction.
According to the Province, the PEZA erred in filing a petition for
certiorari. Arguing that the PEZA sought to reverse a Regional Trial Court
decision in a local tax case, the Province claimed that the court with
appellate jurisdiction over the action is the Court of Tax Appeals. The
PEZA then prayed that the Court of Appeals dismiss the petition for
certiorari for lack of jurisdiction over the subject matter of the action.

The Court of Appeals ruled that the trial court judge gravely abused his
discretion in dismissing the PEZA’s petition for prohibition. Court of
Appeals granted the PEZA’s petition for certiorari. It set aside the trial
court’s decision and nullified all the Province’s proceedings with respect
to the collection of real property taxes from the PEZA. The Province filed
a motion for reconsideration, which the Court of Appeals denied for lack
of merit.

ISSUES:
1. Whether the Court of Appeals erred in dismissing the City of Lapu-
Lapu’s appeal for raising pure questions of law; NO.
2. Whether the Regional Trial Court, Branch 111, Pasay City had
jurisdiction to hear, try, and decide the City of Lapu-Lapu’s petition for
declaratory relief; NO.
3. Whether the petition for injunction filed before the Regional Trial
Court, Branch 115, Pasay City, is a local tax case appealable to the Court
of Tax Appeals; NO.

RULING:
1. The Court of Appeals did not err in dismissing the City of Lapu-Lapu’s
appeal for raising pure questions of law. Under the Rules of Court, there
are three modes of appeal from Regional Trial Court decisions. The first
mode is through an ordinary appeal before the Court of Appeals where
the decision assailed was rendered in the exercise of the Regional Trial
Court’s original jurisdiction. Ordinary appeals are governed by Rule 41,

135
Sections 3 to 13 of the Rules of Court. In ordinary appeals, questions of
fact or mixed questions of fact and law may be raised. The second mode is
through a petition for review before the Court of Appeals where the
decision assailed was rendered by the Regional Trial Court in the exercise
of its appellate jurisdiction. Rule 42 of the Rules of Court governs
petitions for review before the Court of Appeals. In petitions for review
under Rule 42, questions of fact, of law, or mixed questions of fact and
law may be raised. The third mode is through an appeal by certiorari
before this court under Rule 45 where only questions of law shall be
raised.

A question of fact exists when there is doubt as to the truth or falsity of

the alleged facts. On the other hand, there is a question of law if the
appeal raises doubt as to the applicable law on a certain set of facts.
Under Rule 50, Section 2, an improper appeal before the Court of Appeals
is dismissed outright and shall not be referred to the proper court.

With respect to appeals by certiorari directly filed before this court but
which raise questions of fact, paragraph 4(b) of Circular No. 2-90 dated
March 9, 1990 states that this court "retains the option, in the exercise of
its sound discretion and considering the attendant circumstances, either
itself to take cognizance of and decide such issues or to refer them to the
Court of Appeals for determination." In Indoyon, Jr. v. Court of Appeals,
we said that this court "cannot tolerate ignorance of the law on appeals." It
is not this court’s task to determine for litigants their proper remedies
under the Rules. We agree that the City availed itself of the wrong mode
of appeal before the Court of Appeals. The City raised pure questions of
law in its appeal. The issue of whether the Regional Trial Court of Pasay
had jurisdiction over the PEZA’s petition for declaratory relief is a
question of law, jurisdiction being a matter of law.114 The issue of
whether the PEZA is a government instrumentality exempt from payment
of real property taxes is likewise a question of law since this question is
resolved by examining the provisions of the PEZA’s charter as well as
other laws relating to the PEZA.

Nevertheless, considering the important questions involved in this case,

we take cognizance of the City’s petition for review on certiorari in the

136
interest of justice. We opt to relax the rules in this case. The PEZA
operates or otherwise administers special economic zones all over the
country. Resolving the substantive issue of whether the PEZA is taxable
for real property taxes will clarify the taxing powers of all local
government units where special economic zones are operated. This case,
therefore, should be decided on the merits.

2. The Regional Trial Court of Pasay had no jurisdiction to hear, try, and
decide the PEZA’s petition for declaratory relief against the City of Lapu-
Lapu. The court with jurisdiction over petitions for declaratory relief is
the Regional Trial Court, the subject matter of litigation in an action for
declaratory relief being incapable of pecuniary estimation. Consistent
with the law, the Rules state that a petition for declaratory relief is filed
"in the appropriate Regional Trial Court." A special civil action for
declaratory relief is filed for a judicial determination of any question of
construction or validity arising from, and for a declaration of rights and
duties, under any of the following subject matters: a deed, will, contract
or other written instrument, statute, executive order or regulation,
ordinance, or any other governmental regulation.

However, a declaratory judgment may issue only if there has been "no
breach of the documents in question." If the contract or statute subject
matter of the action has already been breached, the appropriate ordinary
civil action must be filed. If adequate relief is available through another
form of action or proceeding, the other action must be preferred over an
action for declaratory relief. It is also required that the parties to the action
for declaratory relief be those whose rights or interests are affected by the
contract or statute in question. "There must be an actual justiciable
controversy or the ‘ripening seeds’ of one" between the parties. The issue
between the parties "must be ripe for judicial determination." An action
for declaratory relief based on theoretical or hypothetical questions
cannot be filed for our courts are not advisory courts.

We rule that the PEZA erred in availing itself of a petition for declaratory
relief against the City. The City had already issued demand letters and
real property tax assessment against the PEZA, in violation of the PEZA’s

137
alleged tax-exempt status under its charter. The Special Economic Zone
Act of 1995, the subject matter of PEZA’s petition for declaratory relief,
had already been breached. The trial court, therefore, had no jurisdiction
over the petition for declaratory relief. There are several aspects of
jurisdiction. Jurisdiction over the subject matter is "the power to hear and
determine cases of the general class to which the proceedings in question
belong." It is conferred by law, which may either be the Constitution or a
statute. Jurisdiction over the subject matter means "the nature of the cause
of action and the relief sought." Thus, the cause of action and character of
the relief sought as alleged in the complaint are examined to determine
whether a court had jurisdiction over the subject matter. Any decision
rendered by a court without jurisdiction over the subject matter of the
action is void.

In the present case, the Regional Trial Court had no jurisdiction over the
subject matter of the action, specifically, over the remedy sought. An
action for declaratory relief presupposes that there has been no actual
breach of the instruments involved or of rights arising thereunder. Since
the purpose of an action for declaratory relief is to secure an authoritative
statement of the rights and obligations of the parties under a statute,
deed, or contract for their guidance in the enforcement thereof, or
compliance therewith, and not to settle issues arising from an alleged
breach thereof, it may be entertained only before the breach or violation of
the statute, deed, or contract to which it refers. Instead of a petition for
declaratory relief, the PEZA should have directly resorted to a judicial
action. The PEZA should have filed a complaint for injunction, the
"appropriate ordinary civil action "to enjoin the City from enforcing its
demand and collecting the assessed taxes from the PEZA. After all, a
declaratory judgment as to the PEZA’s tax-exempt status is useless unless
the City is enjoined from enforcing its demand.

3. The Court of Appeals had no jurisdiction over the PEZA’s petition for
certiorari against the Province of Bataan. Appeal is the remedy "to obtain
a reversal or modification of a judgment on the merits."182 A judgment
on the merits is one which "determines the rights and liabilities of the
parties based on the disclosed facts, irrespective of the formal, technical or

138
dilatory objections." It is not even necessary that the case proceeded to
trial. So long as the "judgment is general" and "the parties had a full legal
opportunity to be heard on their respective claims and contentions," the
judgment is on the merits.
On the other hand, certiorari is a special civil action filed to annul or
modify a proceeding of a tribunal, board, or officer exercising judicial or
quasi-judicial functions. Certiorari, which in Latin means "to be more
fully informed," was originally a remedy in the common law. In this case,
the trial court’s decision is a judgment on the merits. Based on the facts
disclosed by the parties, the trial court declared the PEZA liable to the
Province of Bataan for real property taxes. The PEZA’s proper remedy
against the trial court’s decision, therefore, is appeal.
Since the PEZA filed a petition for certiorari against the trial court’s
decision, it availed itself of the wrong remedy. As the Province of Bataan
contended, the trial court’s decision dated January 31, 2007 "is only an
error of judgment appealable to the higher level court and may not be
corrected by filing a petition for certiorari."198 That the trial court judge
allegedly committed grave abuse of discretion does not make the petition
for certiorari the correct remedy. The PEZA should have raised this
ground in an appeal filed within 15 days from notice of the assailed
resolution.

This court, "in the liberal spirit pervading the Rules of Court and in the
interest of substantial justice," has treated petitions for certiorari as an
appeal: "(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."Considering that "the nature of an
action is determined by the allegationsof the complaint or the petition and
the character of the relief sought," a petition which "actually avers errors
of judgment rather than errors than that of jurisdiction" may be
considered a petition for review.

However, the PEZA’s petition for certiorari was filed before the wrong
court. The PEZA should have filed its petition before the Court of Tax
Appeals. The Court of Tax Appeals has the exclusive appellate
jurisdiction over local tax cases decided by Regional Trial Courts. We

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have also ruled that the Court of Tax Appeals, not the Court of Appeals,
has the exclusive original jurisdiction over petitions for certiorari assailing
interlocutory orders issued by Regional Trial Courts in a local tax 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. In this case,
the petition for injunction filed before the Regional Trial Court of Pasay
was a local tax case originally decided by the trial court in its original
jurisdiction. Since the PEZA assailed a judgment, not an interlocutory
order, of the Regional Trial Court, the PEZA’s proper remedy was an
appeal to the Court of Tax Appeals.

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 EAGLERIDGE DEVELOPMENT CORPORATION, MARCELO N.
NAVAL and CRISPIN I. OBEN, Petitioners, vs. CAMERON
GRANVILLE 3 ASSET MANAGEMENT, INC., Respondent.

G.R. No. 204700

November 24, 2014

J. Leonen

DOCTRINE:
The availment of a motion for production, as one of the modes of discovery, is not
limited to the pre-trial stage. Rule 27 does not provide for any time frame within
which the discovery mode of production or inspection of documents can be
utilized. The rule only requires leave of court "upon due application and a
showing of due cause."

FACTS:
Petitioners Eagleridge Development Corporation (EDC), and
sureties Marcelo N. Naval (Naval) and Crispin I. Oben (Oben) are the
defendants in a collection suit initiated by Export and Industry Bank (EIB)
through a Complaint and currently pending proceedings before the RTC
Makati. By virtue of a Deed of Assignment, EIB transferred EDC's
outstanding loan obligations of ₱10,232,998.00 to respondent Cameron
Granville 3 Asset Management, Inc. (Cameron), a special purpose vehicle.
Thereafter, Cameron filed its Motion to Substitute/Join EIB, which was
granted by the trial court. Petitioners filed a Motion for
Production/Inspection of the Loan Sale and Purchase Agreement (LSPA)
referred to in the Deed of Assignment. Respondent Cameron filed its
Comment alleging that petitioners have not shown "good cause" for the
production of the LSPA and that the same is allegedly irrelevant to the
case a quo.

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In response, petitioners filed their Reply explaining that the production of
the LSPA was for "good cause". They pointed out that the claim of
Cameron is based on an obligation purchased after litigation had already
been instituted in relation to it. When a credit or other incorporeal right in
litigation is sold, the debtor shall have a right to extinguish it by
reimbursing the assignee for the price the latter paid therefor, the judicial
costs incurred by him, and the interest on the price from the day on which
the same was paid. The trial court denied petitioners' motion for
production for being utterly devoid of merit. It ruled that there was
failure to show "good cause" for the production of the LSPA and failure to
show that the LSPA is material or contains evidence relevant to an issue
involved in the action. It denied petitioners' motion for reconsideration.
On Petition for Certiorari with the CA, the same was dismissed the
petition for lack of petitioner Oben's verification and certification against
forum shopping and failure to attach a copy of the complaint. The SC
eventually ruled. Consequently, this Court finds and so holds that the
denial of the Motion for Production despite the existence of "good cause,"
relevancy and materiality for the production of the LSPA was
unreasonable and arbitrary constituting grave abuse of discretion on the
part of the trial court. The parties moved to reconsider the SC decision.

ISSUES:
(1) The motion for production was filed out of time;
(2) The LSPA is a privileged and confidential document.

RULING:
1. We deny the motion for reconsideration. Discovery mode of
production/inspection of document may be availed of even beyond pre-
trial upon a showing of good cause. The availment of a motion for
production, as one of the modes of discovery, is not limited to the pre-trial
stage. Rule 27 does not provide for any time frame within which the
discovery mode of production or inspection of documents can be utilized.
The rule only requires leave of court "upon due application and a

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showing of due cause." "The modes of discovery are accorded a broad and
liberal treatment." The evident purpose of discovery procedures is "to
enable the parties, consistent with recognized privileges, to obtain the
fullest possible knowledge of the issues and facts before civil trials" and,
thus, facilitating an amicable settlement or expediting the trial of the case.
Technicalities in pleading should be avoided in order to obtain substantial
justice. We have determined that the LSPA is relevant and material to the
issue on the validity of the deed of assignment raised by petitioners in the
court a quo, and allowing its production and inspection by petitioners
would be more in keeping with the objectives of the discovery rules. We
find no great practical difficulty, and respondent continuously fails to
allege any, in presenting the document for inspection and copying of
petitioners. On the other hand, to deny petitioners the opportunity to
inquire into the LSPA would bar their access to relevant evidence and
impair their fundamental right to due process.

2. The LSPA is not privileged and confidential in nature. Indeed, Rule 27

contains the proviso that the documents sought to be produced and
inspected must not be privileged against disclosure. Rule 130, Section 24
describes the types of privileged communication. These are
communication between or involving the following: (a) between husband
and wife; (b) between attorney and client; (c) between physician and
patient; (d) between priest and penitent; and (e) public officers and public
interest. Privileged communications under the rules of evidence is
premised on an accepted need to protect a trust relationship. It has not
been shown that the parties to the deed of assignment fall under any of
the foregoing categories.
This court has previously cited other privileged matters such as the
following: "(a) editors may not be compelled to disclose the source of
published news; (b) voters may not be compelled to disclose for whom
they voted; (c) trade secrets; (d) information contained in tax census
returns; . . . (d) bank deposits" (pursuant to the Secrecy of Bank Deposits
Act); (e) national security matters and intelligence information;63 and (f)
criminal matters.64 Nonetheless, the LSPA does not fall within any of

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these classes of information. Moreover, the privilege is not absolute, and
the court may compel disclosure where it is indispensable for doing
justice.
At any rate, respondent failed to discharge the burden of showing that the
LSPA is a privileged document. Respondent did not present any law or
regulation that considers bank documents such as the LSPA as classified
information.

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 JUAN P. CABRERA, Petitioner, vs. HENRY YSAAC, Respondent.

G.R. No. 166790

November 19, 2014

J. Leonen

DOCTRINE:
This court “is clothed with ample authority to review matters, even if they are not
assigned as errors in their appeal, if it finds that their consideration is necessary
to arrive at a just decision of the case.”

FACTS:
The heirs of Luis and Matilde Ysaac co-owned a parcel of land
located in Sabang, Naga City. One of the co-owners is respondent, Henry
Ysaac who leased out portions of the property to several lessees. Juan
Cabrera, one of the lessees, leased a portion of the land. Henry Ysaac
needed money and offered to sell the piece of land to Juan Cabrera. He
told Henry Ysaac that the land was too small for his needs because there
was no parking space for his vehicle. In order to address Juan Cabrera’s
concerns, Henry Ysaac expanded his offer to include the two adjoining
lands that Henry Ysaac was then leasing to the Borbe family and the
Espiritu family. The sale eventually pushed through, and Juan Cabrera
tried to pay the balance of the purchase price to Henry Ysaac. However, at
that time, Henry Ysaac was in the United States. The only person in
Henry Ysaac’s residence was his wife who refused to accept Juan
Cabrera’s payment. Cabrera then requested to reduce the area of the land
subject of their transaction. Part of the 439-square-meter land was going
to be made into a barangay walkway, and another part was being
occupied by a family that was difficult to eject. Juan Cabrera agreed to the
proposal. The land was surveyed again. According to Juan Cabrera,
Henry Ysaac agreed to shoulder the costs of the resurvey, which Juan
Cabrera advanced in the amount of ₱3,000.00.

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The resurvey shows that the area now covered by the transaction was 321
square meters. Juan Cabrera intended to show the sketch plan and pay
the amount due for the payment of the lot. Then, Henry Ysaac’s counsel,
Atty. Luis Ruben General, wrote a letter addressed to Atty. Leoncio
Clemente, Juan Cabrera’s counsel informing the latter his client is
formally rescinding the contract of sale because Juan Cabrera failed to pay
the balance of the purchase price of the land. A civil case for specific
performance was lodged. Before the Regional Trial Court decided the
case, the heirs of Luis and Matilde Ysaac, under the administration of
Franklin Ysaac, sold their property to the local government of Naga City.
The property was turned into a project for the urban poor of the city.
RTC Naga ruled that the contract of sale between Juan Cabrera and Henry
Ysaac was duly rescinded when the former failed to pay the balance of
the purchase price in the period agreed upon, and dismissed Juan
Cabrera’s complaint.
The Court of Appeals agreed with the Regional Trial Court that there was
a perfected contract of sale between Juan Cabrera and Henry Ysaac.
In a letter addressed to the Chief Justice, petitioner argued that it would
be unfair to him if a clerical error would deprive his petition from being
judged on the merits.

ISSUE:
Whether this court could take cognizance of issues not raised by
petitioner but by respondent in his comment to the petition for review;
YES.

RULING:
We can consider errors not raised by the parties, more so if these errors
were raised by respondent. Respondent raised different issues compared
with those raised by petitioner. However, the assignment of error of
respondent was still responsive to the main argument of petitioner.

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Petitioner’s argument works on the premise that there was a valid
contract. By attacking the validity of the contract, respondent was merely
responding to the premise of petitioner’s main argument. The issue is
relevant to the final disposition of this case; hence, it should be considered
by this court in arriving at a decision. We also find that there was no
contract of sale. It was null ab initio.

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PEOPLE OF THE PHILIPPINES, Appellee, vs. ENRIQUE QUINTOS y
BADILLA, Accused-appellant.

G.R. No. 199402

November 12, 2014

J. Leonen

DOCTRINE:
Trial provides judges with the opportunity to detect, consciously or
unconsciously, observable cues and micro expressions that could, more than the
words said and taken as a whole, suggest sincerity or betray lies and ill will.
These important aspects can never be reflected or reproduced in documents and
objects used as evidence.

FACTS:
Enrique Quintos y Badilla who was charged with rape allegedly
committed against AAA, a mental retardate. She was 21 years old with a
mental age of 6 years and 2 months. She had an IQ of 38.8 This was based
on the testimony of National Bureau of Investigation clinical psychologist
Accused, who was her neighbor, went to her house to watch television.
Accused followed her when she went to the bathroom. In the bathroom,
accused removed his shorts and underwear, and inserted his penis into
her vagina. AAA did not want to have intercourse with the accused, but
she did not tell the accused to stop. A similar incident happened the nex
tday. While AAA was sleeping, accused removed her undergarments, as
well as his own undergarments. Accused then laid on top of her and,
again, inserted his penis into her vagina. AAA also recalled that on a
different day, accused kissed her and held her breasts. There was also one
Thursday night when accused forced AAA to take his penis inside her
mouth despite her protests. Accused claimed that he did not rape AAA.
He was in a romantic and sexual relationship with AAA. However, he
ended this relationship when he got his now common-law wife pregnant.

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He insisted that AAA’s charges were fabricated because of AAA’s
inability to accept that he ended their relationship.
The trial court issued a judgment finding accused guilty of two counts of
rape. The Court of Appeals issued a decision affirming with modification
the trial court’s decision.

ISSUE:
Whether or not the Accused was properly found guilty on the basis of the
testimonies presented.

RULING:
YES. Trial courts are in the best position to evaluate witnesses’ credibility.
Both the trial court and the Court of Appeals found AAA’s testimony to
be credible and convincing. There is no reason to disturb this finding. The
observance of the witnesses’ demeanor during an oral direct examination,
cross-examination, and during the entire period that he or she is present
during trial is indispensable especially in rape cases because it helps
establish the moral conviction that an accused is guilty beyond reasonable
doubt of the crime charged. Hence, "the evaluation of the witnesses’
credibility is a matter best left to the trial court because it has the
opportunity to observe the witnesses and their demeanor during the trial.
Thus, the Court accords great respect to the trial court’s findings," more
so when the Court of Appeals affirmed such findings.The exception is
when the trial court and/or the Court of Appeals "overlooked or
misconstrued substantial facts that could have affected the outcome of the
case." No such facts were overlooked or misconstrued in this case.
Competence and credibility of mentally deficient rape victims as
witnesses have been upheld by this Court where it is shown that they can
communicate their ordeal capable and consistently. Rather than
undermine the gravity of the complainant's accusations, it even lends
greater credence to her testimony, that, someone as feeble-minded and

149
guileless could speak so tenaciously and explicitly on the details of the
rape if she has not in fact suffered such crime at the hands of the accused.
AAA’s testimony was corroborated by the medical findings, which
showed that there were lacerations in her hymen that were produced by a
blunt object. The testimonial evidence is bolstered by the presence of
these lacerations. Together, they produce a moral conviction that accused
committed the crimes charged.

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 SMI-ED PHILIPPINES TECHNOLOGY, INC., Petitioner, vs.
COMMISSIONER OF INTERNAL REVENUE, Respondent.

G.R. No. 175410

November 12, 2014

J. Leonen

DOCTRINE:
In reviewing the BIR’s assessment and decision, the Court of Tax Appeals had to
make its own determination of the taxpayer’s tax liabilities. The Court of Tax
Appeals may not make such determination before the BIR makes its assessment
and before a dispute involving such assessment is brought to the Court of Tax
Appeals on appeal.

FACTS:
SMI-Ed Philippines is a PEZA-registered corporation authorized "to
engage in the business of manufacturing ultra-high-density
microprocessor unit package."After its registration it constructed
buildings and purchased machineries and equipment. SMI-Ed Philippines
"failed to commence operations."9Its factory was temporarily closed. On
August 1, 2000, it sold its buildings and some of its installed machineries
and equipment to Ibiden Philippines, Inc., another PEZA-registered
enterprise, for ¥2,100,000,000.00 (₱893,550,000.00). SMI-Ed Philippines
was dissolved on November 30, 2000. In its quarterly income tax return
for year 2000, SMI-Ed Philippines subjected the entire gross sales of its
properties to 5% final tax on PEZA registered corporations. SMI-Ed
Philippines paid taxes amounting to ₱44,677,500.00. After requesting the
cancellation of its PEZA registration and amending its articles of
incorporation to shorten its corporate term, SMI-Ed Philippines filed an
administrative claim for the refund of ₱44,677,500.00 with the Bureau of
Internal Revenue (BIR).
SMIEd Philippines alleged that the amount was erroneously paid. It also
alleged that it incurred a net loss of ₱2,233,464,538. The BIR did not act on

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SMI-Ed Philippines’ claim, which prompted the latter to file a petition for
review before the Court of Tax Appeals on September 9, 2002. The Court
of Tax Appeals Second Division denied SMI-Ed Philippines’ claim for
refund in the decision, as the same were filed within the two-year
prescriptive period. However, fiscal incentives given to PEZAregistered
enterprises may be availed only by PEZA-registered enterprises that had
already commenced operations.
SMI-Ed Philippines filed a petition for review before the Court of Tax
Appeals En Banc which affirmed the Court of Tax Appeals Second
Division’s decision and resolution. SMI-Ed Philippines filed a petition for
review before the SC.

ISSUE:
The honorable CTA En Banc grievously erred and acted beyond its
jurisdiction when it assessed for deficiency tax in the first instance.

RULING:
The term "assessment" refers to the determination of amounts due from a
person obligated to make payments. In the context of national internal
revenue collection, it refers the determination of the taxes due from a
taxpayer under the National Internal Revenue Code of 1997. The power
and duty to assess national internal revenue taxes are lodged with the
BIR. The BIR is not mandated to make an assessment relative to every
return filed with it. Tax returns filed with the BIR enjoy the presumption
that these are in accordance with the law. Tax returns are also presumed
correct since these are filed under the penalty of perjury. Generally,
however, the BIR assesses taxes when it appears, after a return had been
filed, that the taxes paid were incorrect, false, or fraudulent. The BIR also
assesses taxes when taxes are due but no return is filed. The Court of Tax
Appeals has no power to make an assessment at the first instance. On
matters such as tax collection, tax refund, and others related to the
national internal revenue taxes, the Court of Tax Appeals’ jurisdiction is
appellate in nature.

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Thus, the BIR first has to make an assessment of the taxpayer’s liabilities.
When the BIR makes the assessment, the taxpayer is allowed to dispute
that assessment before the BIR. If the BIR issues a decision that is
unfavorable to the taxpayer or if the BIR fails to act on a dispute brought
by the taxpayer, the BIR’s decision or inaction may be brought on appeal
to the Court of Tax Appeals. The Court of Tax Appeals then acquires
jurisdiction over the case. When the BIR’s unfavorable decision is brought
on appeal to the Court of Tax Appeals, the Court of Tax Appeals reviews
the correctness of the BIR’s assessment and decision. The Court of Tax
Appeals’ jurisdiction is not limited to cases when the BIR makes an
assessment or a decision unfavorable to the taxpayer. Because Republic
Act No. 112553 also vests the Court of Tax Appeals with jurisdiction over
the BIR’s inaction on a taxpayer’s refund claim, there may be instances
when the Court of Tax Appeals has to take cognizance of cases that have
nothing to do with the BIR’s assessments or decisions. When the BIR fails
to act on a claim for refund of voluntarily but mistakenly paid taxes, for
example, there is no decision or assessment involved.

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AMADA COTONER-ZACARIAS, Petitioner, vs. SPOUSES ALFREDO
AND THE HEIRS REVILLA OF PAZ REVILLA, Respondents.

G.R. No. 190901

November 12, 2014

J. Leonen

DOCTRINE:
It is true 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."

FACTS:
The Revilla spouses are the owners in fee simple of an unregistered
parcel of land in Silang, Caviteand faced financial difficulties in raising
funds for Alfredo Revilla’s travel to Saudi Arabia. Paz Castillo-Revilla
borrowed money from Amada Cotoner-Zacarias (Amada). By way of
security, the parties verbally agreed that Amada would take physical
possession of the property, cultivate it, then use the earnings from the
cultivation to pay the loan and realty taxes. Upon full payment of the
loan, Amada would return the property to the Revilla spouses. Unknown
to the Revilla spouses, Amada presented a fictitious document entitled
"Kasulatan ng Bilihanng Lupa" before the Provincial Assessor of Cavite.
This document was executed with the Revilla spouses as sellers and
Amada as buyer of the property. Amada sold the property to the spouses
Casorla by "Deed of Absolute Sale Unregistered Land." a Tax Declaration
was later issued in the name of the Casorla spouses, who in turn, sold the
same to Sun spouses. Alfredo Revilla returned from Saudi Arabia. He
asked Amada why she had not returned their tax declaration considering
their full payment of the loan. He then discovered that the property’s tax
declaration was already in the name of the Sun spouses.

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A land registration case filed by the Sun spouses for the property. The
Revilla spouses then saw a copy of the "Kasulatan ng Bilihan ng Lupa"
and noticed that their signatures as sellers were forged. Regional Trial
Court found the "Kasulatan ng Bilihan ng Lupa" to be a fictitious
document, and ruled in favor of the Revilla spouses. Amada appealed the
trial court’s decision, to which the Court of Appeals dismissed and
partially granted the appeal of the Sun spouses.

ISSUE:
Whether or not the proper docket fees, were paid docket fees by the
Revilla spouses based on their prayer for actual damages of ₱50,000.00,
moral damages of ₱50,000.00, and attorney’s fee of ₱80,000.00, when they
should have based it on ₱12,000,000.00, the value of the property.

RULING:
This court finds that respondents Revilla spouses paid the proper docket
fees, thus, the trial court acquired jurisdiction. 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 be 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 in sofar
as it is inconsistent with this pronouncement is overturned and reversed.
In the case at bench, the complaint filed by the Spouses Revilla only asked
for actual damages in the amount of ₱50,000.00. While the Spouses Revilla
mentioned the amount of ₱12,000,000.00 as actual damages in the pre-

155
trial, said amount was not stated in the complaint and neither was it
awarded by the lower court in its judgment. Hence, said amount was not
even considered by the court a quo when it awarded damages in favor of
the Spouses Revilla. Considering that the complaint was not formally
amended by the spouses to increase the amount of actual damages being
sought, the trial court was not stripped of its jurisdiction to try the case
since the Spouses Revilla correctly paid the docket fees based merely on
what was prayed for in the complaint. Indeed, the mere mentioning by
the Spouses Revilla of the amount of ₱12,000,000.00 during the pre-trial is
inconsequential, as the trial court properly acquired jurisdiction over the
action when the Spouses Revilla filed the complaint and paid the requisite
filing fees based on the amount as prayed for in the complaint.

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 BANCO DE ORO, et.al., Petitioners, vs.
REPUBLIC OF THE PHILIPPINES and THE COMMISSIONER OF
INTERNAL REVENUE, et.al., Respondents.

G.R. No. 198756

January 13, 2015

Leonen, J.

DOCTRINE:
“If superior administrative officers [can] grant the relief prayed for, [then] special
civil actions are generally not entertained. The remedy within the administrative
machinery must be resorted to first and pursued to its appropriate conclusion
before the court’s judicial power can be sought. Nonetheless, jurisprudence allows
certain exceptions to the rule on exhaustion of administrative remedies.”

FACTS:
In 2001, The Bureau of Treasury issued P35.0B worth of 10- year zero-
coupon bond Treasury Certificates, a government- issued debt
instrument, in favor of Rizal Commercial Banking Corporation (RCBC).
At that time, the Bureau of Internal Revenue (BIR) issued BIR Ruling No.
020-2001(2001 BIR Ruling) confirming that the said government bonds
would not be classified as deposit substitutes and would not be subject to
the corresponding 20% final withholding tax (FWT). Thus, according to
the 2001 Ruling, to be classified as "deposit substitutes", the borrowing of
funds must be obtained from twenty (20) or more individuals or
corporate lenders at any one time. In this light, since the bonds will be
issued only to one entity, i.e., RCBC, the same shall not be considered as
"deposit substitutes" falling within the purview of the above definition.
Hence, the withholding tax on deposit substitutes will not apply.
After several consistent declarations that such bonds are exempt from
20% FWT, however, on October 7, 2011, eleven (11) days before the

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maturity of the government bond, the BIR issued the assailed BIR Ruling
No. DA 378-2011 (2011 BIR Ruling) now imposing a 20% FWT on
government bonds and directing the Bureau of Treasury to withhold said
final tax at the maturity thereof.
Upon maturity of the bond on October 18 2011, the Bureau of Treasury
paid RCBC (and other bondholders) the amounts representing the face
value of the bonds1; however, the Bureau of Treasury refused to release
the amounts corresponding to the 20% FWT.
RCBC (and other bondholders) questioned the validity of 2011 BIR Ruling
directly before the Supreme Court via a Rule 65 Petition for Certiorari,
Mandamus and/or Prohibition. The petitioners theorized that the 2011
BIR Ruling violates the non- impairment of contract clause of the
Constitution and constitutes a deprivation of property without due
process of law.
For its part, the BIR argued that petitioners’ direct resort to this Court to
challenge the 2011 BIR Ruling violates the doctrine of exhaustion of
administrative remedies. According to the BIR, an appeal to the Secretary
of Finance would be the proper remedial measure.

ISSUE:
Whether or not the failure of the petitioners to adhere to the doctrine of
exhaustion of administrative remedies would justify the dismissal of the
instant case.

RULING:
No. Said the Court: “ If superior administrative officers [can] grant the
relief prayed for, [then] special civil actions are generally not
entertained."The remedy within the administrative machinery must be
1
The face value of the government bond in the instant case is P35.0B; the capital initially invested in the bonds
by RCBC is approximately P10.2B. The P24.8B (difference between the face value of the bond and the capital
investment) represents the interest income of RCBC, such interest is here being subjected to 20% FWT.

158
resorted to first and pursued to its appropriate conclusion before the
court’s judicial power can be sought.
Nonetheless, jurisprudence allows certain exceptions to the rule on
exhaustion of administrative remedies:
[The doctrine of exhaustion of administrative remedies] is a relative one
and its flexibility is called upon by the peculiarity and uniqueness of the
factual and circumstantial settings of a case. Hence, it is disregarded (1)
when there is a violation of due process, (2) when the issue involved is
purely a legal question, (3) when the administrative action is patently
illegal amounting to lack or excess of jurisdiction,(4) when there is
estoppel on the part of the administrative agency concerned,(5) when
there is irreparable injury, (6) when the respondent is a department
secretary whose acts as an alter ego of the President bears the implied and
assumed approval of the latter, (7) when to require exhaustion of
administrative remedies would be unreasonable, (8) when it would
amount to a nullification of a claim, (9) when the subject matter is a
private land in land case proceedings, (10) when the rule does not provide
a plain, speedy and adequate remedy, (11) when there are circumstances
indicating the urgency of judicial intervention. (Emphasis supplied)
The exceptions under (2) and (11) are present in this case. The question
involved is purely legal, namely: Whether the imposition of the 20% final
withholding tax on the Bonds upon maturity violates the constitutional
provisions on non-impairment of contracts and due process.
The rule on exhaustion of administrative remedies also finds no
application when the exhaustion will result in an exercise in futility.
In this case, an appeal to the Secretary of Finance from the questioned
2011 BIR Ruling would be a futile exercise because it was upon the
request of the Secretary of Finance that the 2011 BIR Ruling was issued by
the Bureau of Internal Revenue. It appears that the Secretary of Finance
adopted the Commissioner of Internal Revenue’s opinions as his
own. This position was in fact confirmed in the letter dated October 10,
2011 where he ordered the Bureau of Treasury to withhold the amount

159
corresponding to the 20% final withholding tax on the interest or
discounts allegedly due from the bondholders on the strength of the 2011
BIR Ruling.

160
MARIA THERESA G. GUTIERREZ, Petitioner, vs. COMMISSION ON
AUDIT and AUDITOR NARCISA DJ JOAQUIN, Respondents.

G.R. No. 200628

January 13, 2015

LEONEN, J.

DOCTRINE:
“Due process is satisfied when a person is notified of the charge against him and
given an opportunity to explain or defend himself. In administrative proceedings,
the filing of charges and giving reasonable opportunity for the person so charged
to answer the accusations against him constitute the minimum requirements of
due process. The essence of due process is simply to be heard, or as applied to
administrative proceedings, an opportunity to explain one's side, or an
opportunity to seek a reconsideration of the action or ruling complained of.”

FACTS:

Maria Theresa Gutierrez is a Cash Collecting Officer, with the designation

of Cashier III at National Food Authority-National Capital Region,
National District Office (NFA-NCR, NDO). On May 30, 2008, a Friday, she
had collections amounting to P9,390,834.00, covered by Official Receipt
Nos. 0420975 to 0421246. On that day, she placed the collections in a
wooden cabinet.

The next day, Gutierrez's collections amounted to P1,505,625.00. A portion

of that amount was placed in a wooden cabinet. The rest was placed in
the safety vault.

The total undeposited collection as of March 31, 2008 was P10,896,459.50.

Of that amount, P10,105,687.25 was placed in the "pearless" boxes in a
wooden cabinet and P790,772.25 was placed in the safety vault.

On June 1, 2008, at about 1:35 a.m., armed men in military uniforms with
Philippine National Police-Security Agencies and Guards Supervision

161
Division (PNP-SAGSD) identifications entered the NFA-NCR, NDO. The
armed men disarmed NFA-NCR, NDO's security guards and took
Gutierrez's undeposited collections.

On June 3, 2008, the Commission on Audit (COA), through State Auditor

Narcisa DJ Joaquin (State Auditor Joaquin), issued a demand letter to
Gutierrez. Gutierrez was informed that she must immediately produce
the missing funds amounting to P10,105,686.75. She was also ordered to
submit within 72 hours a written explanation why such shortage
occurred.

On June 5, 2008, State Auditor Joaquin, issued a withholding order

pursuant to Sec.37 of Presidential Decree No. 1445 to withhold Gutierrez's
salaries and other emoluments so these could be applied to the
satisfaction of the shortage

In response to the June 3, 2008 demand letter of the COA, Gutierrez

executed an affidavit dated June 6, 2008 wherein she narrated, among
others that, since May 30, 2008 is a Friday, banks are closed the following
day and the money collected on said date would have remained in her
office until the next banking day; and that, because the vault has not
enough space to accommodate the volume of the money accepted on May
30, 2008 and the collection in the night before the robbery, she placed
them in the pearless box inside the cabinet.

On June 10, 2008, Gutierrez, through a letter addressed to State Auditor

Joaquin, requested relief from money accountability for the loss of the
collections. Gutierrez likewise appealed the withholding order and
prayed that her salaries and emoluments be given to her while the
robbery incident was still under investigation. She was a widow who had
three (3) dependents and an 85-year-old mother residing with her in need
of medical attention. She had no other source of income to support
herself, her dependents, and her mother.

On June 26, 2008, State Auditor Joaquin denied Gutierrez's appeal of the
withholding order. State Auditor Joaquin informed Gutierrez that there
was already a prima facie case for malversation against her under Article
217 of the Revised Penal Code.

162
On July 11, 2008, Gutierrez filed a notice of appeal of State Auditor
Joaquin's withholding order dated June 5, 2008.

On September 11, 2008, COA Director IV Tito S. Nabua (Director Nabua)

issued a decision denying Gutierrez's appeal and expressing his
agreement with the issuance of the withholding order. This he did
without giving Gutierrez the opportunity to submit her appeal
memorandum. Thus, Gutierrez filed a motion for reconsideration of the
September 11, 2008 decision of Director Nabua on the ground that he did
not give her a chance to file a memorandum of appeal before submission
of the case for resolution. According to Gutierrez, this was a violation of
the Revised Rules of Procedure of the COA2 and of her right to due
process. Finally, on January 31, 2012, the COA denied her request for
relief from money accountability. Hence, this Rule 65 Petition for
Certiorari.

Petitioner Gutierrez argues that she was assisted by counsel only after the
withholding order had already been issued and also, the issuance of the
decision by the COA Director on her appeal without requiring her to file
appeal memorandum was a violation of her due process right. On the
other hand, respondents argue that petitioner was not deprived of due
process when she was not given the opportunity to file an appeal
memorandum because her affidavit was a sufficient platform to raise her
defenses. Moreover, the presence of a counsel is not required in
administrative proceedings

ISSUE:

Whether or not Gutierrez’s due process rights were violated when the
COA decided her appeal without requiring her to file an appeal
memorandum.
2
Section 5. APPEAL MEMORANDUM AND REPLY - Upon receipt of the records of the case, the Director shall
issue an Order requiring the appellant to file an appeal memorandum within twenty (20) days from receipt of the
order. The appellant shall serve a copy of his appeal memorandum to the Auditor or appellee who may reply
thereto within the same period of time. With the filing of the appeal memorandum and reply or lapse of the
period within which to file them, the appeal shall be deemed submitted for decision.

163
RULING:

No. The Court held that: “Petitioner's due process rights were not
violated when the Commission on Audit Director had failed to require
her to submit an appeal memorandum before he decided her appeal of
the State Auditor's issuance of a withholding order. There was also no
violation of due process rights when the Commission on Audit issued its
January 31, 2012 decision denying her request for relief from
accountability, without a petition for review of the Commission on Audit
Director's decision. The right to appeal is not part of due process. Neither
is it a natural right.

Also, the right to counsel under Section 12(1) of Article III of the
Constitution applies in criminal proceedings, but not in administrative
proceedings. It is a right given to persons accused of an offense during
criminal investigation. Any proceeding conducted by an administrative
body is not part of the criminal investigation or prosecution.

Thus, this court said in Remolona v. Civil Service Commission:

While investigations conducted by an administrative body may at times

be akin to a criminal proceeding, the fact remains that under existing
laws, a party in an administrative inquiry may or may not be assisted by
counsel, irrespective of the nature of the charges and of the respondent's
capacity to represent himself, and no duty rests on such body to furnish
the person being investigated with counsel. In an administrative
proceeding, a respondent has the option of engaging the services of
counsel or not. Thus, the right to counsel is not always imperative in
administrative investigations because such inquiries are conducted
merely to determine whether there are facts that merit disciplinary
measure against erring public officers and employees, with the purpose of
maintaining the dignity of government service. As such, the hearing
conducted by the investigating authority is not part of a criminal
prosecution.

164
While the purpose of criminal proceedings is to determine if a person
suspected of committing an offense has indeed committed an offense, the
purpose of an administrative proceeding is to determine if a person in
public office has violated the trust reposed in him or her by the public. In
a criminal proceeding, if a person is found guilty of an offense, the
corresponding punishment is imposed primarily to protect the public
from being exposed to and correct his or her deviant behavior. In an
administrative proceeding, if a person is found administratively liable, the
corresponding penalty is imposed primarily to preserve public trust and
protect the integrity of public service.

Petitioner is not being accused of or investigated for a crime. The

Commission on Audit's withholding order and its denial of petitioner's
request for relief from shortage were issued after it had made a finding
that the money entrusted to petitioner was lost. A finding of criminal
liability was not the reason for the Commission on Audit's issuances. The
Commission on Audit has no jurisdiction to investigate a crime or to
make a finding of criminal liability. Any proceeding conducted prior to
these issuances was for the purpose of determining if petitioner's salaries
should be withheld or if petitioner should be relieved from her liability as
a cashier.

In sum, due process in administrative proceedings does not necessarily

require a trial type of hearing. Neither does it require an exchange of
pleadings between or among the parties. Due process is satisfied if the
party who is properly notified of allegations against him or her is given
an opportunity to defend himself or herself against those allegations, and
such defense was considered by the tribunal in arriving at its own
independent conclusions. This court explained in Ledesma v. Court of
Appeals:

Due process is satisfied when a person is notified of the charge against

him and given an opportunity to explain or defend himself. In
administrative proceedings, the filing of charges and giving reasonable
opportunity for the person so charged to answer the accusations against
him constitute the minimum requirements of due process. The essence of
due process is simply to be heard, or as applied to administrative

165
proceedings, an opportunity to explain one's side, or an opportunity to
seek a reconsideration of the action or ruling complained of.

Administrative due process cannot be fully equated with due process in

its strict judicial sense for it is enough that the party is given the chance to
be heard before the case against him is decided.

166
 CLUB FILIPINO, INC., Petitioner, vs. BENJAMIN BAUTISTA
et.al., Respondents.
G.R. No. 168406
January 14, 2015
LEONEN, J.:

DOCTRINE:

“The grant of leave to file a Supplemental Motion for Reconsideration will not
prevent a court’s resolution from becoming final and executory. A decision or
resolution of this court is deemed final and executory after the lapse of 15 days
from the parties’ receipt of a copy of the decision or resolution. The grant of leave
to file the second Motion for Reconsideration does not toll this 15-day period. It
only means that the Entry of Judgment first issued may be lifted should the
second Motion for Reconsideration be granted”

FACTS:

The present controversy stemmed from a labor dispute between Club

Filipino Employees Association (CLUFEA), a union representing the
employees of Club Filipino, Inc., and Club Filipino, Inc.

During the 60-day freedom period, CLUFEA had made several demands
on Club Filipino, Inc. to negotiate a new collective bargaining agreement.
On April 5, 2001, the negotiating panels of CLUFEA and Club Filipino,
Inc. finally met. However, the meeting ended with parties’ respective
panels declaring a deadlock in negotiation.

Later, CLUFEA staged a strike on the ground of bargaining deadlock.

Meanwhile, Club Filipino, Inc. filed before the National Labor Relations
Commission (NLRC) a petition to declare the strike illegal for CLUFEA’s
alleged failure to file a Notice of Strike and to conduct strike vote. Worse,
CLUFEA’s members allegedly committed illegal acts while on strike.

The Labor Arbiter declared the strike illegal. On appeal, the NLRC denied
the appeal for lack of merit. Undaunted, CLUFEA filed a petition for

167
certiorari with the Court of Appeals which granted the same and set aside
the decision of the labor tribunal.

In due time, the labor dispute reached the Supreme Court via Petition for
review on Certiorari filed by Club Filipino, Inc. However, the Supreme
Court sustained the Court of Appeals’ decision and consequently denied
Club Filipinos’ petition for review on certiorari on July 13, 2009.

On August 17, 2009, Club Filipino, Inc. filed a Motion for Reconsideration
but the same was denied with finality in a Resolution dated September 9,
2009. This Court declared that it shall not entertain any further pleadings
or motions and ordered that Entry of Judgment in this case be made in
due course.

On September 14, 2009, Club Filipino, Inc. filed a Motion for Leave to File
and Admit Supplemental Motion for Reconsideration.

On November 3, 2009, Club Filipino, Inc. filed its Motion for Leave to
File and Admit further Pleading/Motion, alleging that this court failed to
consider its Supplemental Motion for Reconsideration in issuing its
September 9, 2009 Resolution denying Club Filipino, Inc.’s first Motion for
Reconsideration. Club Filipino, Inc. prayed that this court resolve the
Supplemental Motion for Reconsideration.

Surprisingly, in a Resolution dated January 11, 2010, this Court granted

Club Filipino, Inc.’s Motions for Leave and noted the Supplemental
Motion for Reconsideration. However, because of this Court’s Resolution
dated September 9, 2009, an Entry of Judgment was issued on October 26,
2010, declaring that this case had become final and executory as of
October 26, 2009. This Court likewise ordered the return of the case
records to the Court of Appeals for remand to the court of origin.

Club Filipino, Inc. received the Entry of Judgment on November 10, 2010.
Nine (9) days after, Club Filipino, Inc. filed a Manifestation and
Motion, arguing that the court prematurely issued the Entry of Judgment
because it still had to resolve the Supplemental Motion for
Reconsideration.

168
ISSUE:

Whether Club Filipino, Inc.’s filing of the Supplemental Motion for

Reconsideration prevented the Court’s Resolution dated July 13, 2009
from becoming final and executory.

RULING:

The filing of the Supplemental Motion for Reconsideration did not

prevent this court’s Resolution dated July 13, 2009 from becoming final
and executory.
Petitioner Club Filipino, Inc.’s Supplemental Motion for Reconsideration
of the Resolution dated July 13, 2009 is in the nature of a second Motion
for Reconsideration.
As a general rule, the filing of second Motions for Reconsideration of a
judgment or final resolution is prohibited. Rule 52, Section 2 of the Rules
of Court provides:
Section 2. Second motion for reconsideration. — No second motion for
reconsideration of a judgment or final resolution by the same party shall
be entertained.
This prohibition is reiterated in Rule 15, Section 3 of the Internal Rules of
the Supreme Court.3
For this Court to entertain second Motions for Reconsideration, the
second Motions must present “extraordinarily persuasive reasons and
only upon express leave first obtained.” Once leave to file is granted, the
second Motion for Reconsideration is no longer prohibited.

Section 3. Second motion for reconsideration. – The Court shall not entertain a second motion for
3

reconsideration, and any exception to this rule can only be granted in the higher interest of justice by the Court
en banc upon a vote of at least two-thirds of its actual membership. There is reconsideration “in the higher
interest of justice” when the assailed decision is not only legally erroneous, but is likewise patently unjust and
potentially capable of causing unwarranted and irremediable injury or damage to the parties. A second motion
for reconsideration can only be entertained before the ruling sought to be reconsidered becomes final by
operation of law or by the Court’s declaration. In the Division, a vote of three Members shall be required to
elevate a second motion for reconsideration to the Court

169
This court explained the rationale for the rule in Ortigas and Company
Limited Partnership v. Judge Velasco, thus:
A second motion for reconsideration is forbidden except for
extraordinarily persuasive reasons, and only upon express leave first
obtained. The propriety or acceptability of such a second motion for
reconsideration is not contingent upon the averment of “new” grounds to
assail the judgment, i.e., grounds other than those theretofore presented
and rejected. Otherwise, attainment of finality of a judgment might be
staved off indefinitely, depending on the party's ingeniousness or
cleverness in conceiving and formulating “additional flaws” or “newly
discovered errors” therein, or thinking up some injury or prejudice to the
rights of the movant for reconsideration. “Piece-meal” impugnation of a
judgment by successive motions for reconsideration is anathema, being
precluded by the salutary axiom that a party seeking the setting aside of a
judgment, act or proceeding must set out in his motion all the grounds
therefor, and those not so included are deemed waived and cease to be
available for subsequent motions.
For all litigation must come to an end at some point, in accordance with
established rules of procedure and jurisprudence. As a matter of practice
and policy, courts must dispose of every case as promptly as possible; and
in fulfillment of their role in the administration of justice, they should
brook no delay in the termination of cases by stratagems or maneuverings
of parties or their lawyers.
In the present case, this court granted leave to petitioner Club Filipino,
Inc. to file the Supplemental Motion for Reconsideration in the Resolution
dated January 11, 2010. The Supplemental Motion for Reconsideration,
therefore, is no longer prohibited.
The grant of leave to file the Supplemental Motion for Reconsideration,
however, did not prevent this court’s July 13, 2009 Resolution from
becoming final and executory. A decision or resolution of this court is
deemed final and executory after the lapse of 15 days from the parties’
receipt of a copy of the decision or resolution. The grant of leave to file the

170
second Motion for Reconsideration does not toll this 15-day period. It
only means that the Entry of Judgment first issued may be lifted should
the second Motion for Reconsideration be granted.
In Aliviado v. Procter and Gamble Philippines, Inc., this court explained that:
[i]t is immaterial that the Entry of Judgment was made without the Court
having first resolved P&G’s second motion for reconsideration. This is
because the issuance of the entry of judgment is reckoned from the time
the parties received a copy of the resolution denying the first motion for
reconsideration. The filing by P&G of several pleadings after receipt of
the resolution denying its first motion for reconsideration does not in any
way bar the finality or entry of judgment. Besides, to reckon the finality of a
judgment from receipt of the denial of the second motion for reconsideration
would be absurd. First, the Rules of Court and the Internal Rules of the Supreme
Court prohibit the filing of a second motion for reconsideration. Second, some
crafty litigants may resort to filing prohibited pleadings just to delay entry of
judgment.(Underscoring in the original, emphasis supplied)
This case became final and executory on October 26, 2009, after the lapse
of the 15th day from petitioner Club Filipino, Inc.’s receipt of the
Resolution denying its first Motion for Reconsideration. Entry of
Judgment, therefore, was in order.

171
 SAUDI ARABIAN AIRLINES (SAUDIA) VS. MA. JOPETTE M.
REBESENCIO
G.R. No. 198587
January 24, 2015

Leonen, J.

DOCTRINE:

Under the doctrine of forum non conveniens, “a court, in conflicts of law cases,
may refuse impositions on its jurisdiction where it is not the most ‘convenient’ or
available forum and the parties are not precluded from seeking remedies
elsewhere.”

The doctrine of forum non conveniens addresses the same rationale that the rule
against forum shopping does, albeit on a multijurisdictional scale. Forum non
conveniens, like res judicata, is a concept originating in common law. However,
unlike the rule on res judicata, as well as those on litis pendentia and forum
shopping, forum non conveniens finds no textual anchor, whether in statute or in
procedural rules, in our civil law system. Nevertheless, jurisprudence has applied
forum non conveniens as basis for a court to decline its exercise of jurisdiction.

FACTS:
SAUDIA is a foreign corporation established in Jeddah, Kingdom of
Saudi Arabia. Rebesencio et, al. were recruited and hired by SUDIA as
Temporary Flight Attendants with the accreditation and approval of
POEA.

Consequently, on separate occasions, the Respondents asked for

Maternity Leave when they got pregnant. Initially, Saudia had given its
approval put later on informed Rebesenico that its management in
Jeddah, Saudi Arabia had disapproved their maternity leaves. In addition,
it required respondents to file their resignation letters. They were told that
if they did not resign, Saudia would terminate them all the same. The
threat of termination entailed the loss of benefits, such as separation pay
and ticket discount entitlements.

172
Rebesncio et, al. then filed a case against SAUDIA for illegal termination
with the National Labor Relations Commission (NLRC). The NLRC ruled
in favor of the SAUDIA asserts that stipulations set in the Cabin
Attendant contracts require the application of the laws of Saudi Arabia. It
insists that the need to comply with these stipulations calls into operation
the doctrine of forum non conveniens and, in turn, makes it necessary for
Philippine tribunals to refrain from exercising jurisdiction.

ISSUES:
1. Whether or not the forum non convenience can be a ground for
dismissal in this case.
2. Whether or not SAUDIA is correct in claiming that the NLRC
should refrain from exercising jurisdiction because of Forum Non
Convenience.

RULING:
1. NO. On the matter of pleading forum non conveniens, we state the
rule, thus: Forum non conveniens must not only be clearly pleaded as a
ground for dismissal; it must be pleaded as such at the earliest possible
opportunity. Otherwise, it shall be deemed waived.

Consistent with forum non conveniens as fundamentally a factual matter,

it is imperative that it proceed from a factually established basis. It would
be improper to dismiss an action pursuant to forum non conveniens
based merely on a perceived, likely, or hypothetical multiplicity of fora.
Thus, a defendant must also plead and show that a prior suit has, in fact,
been brought in another jurisdiction.

The existence of a prior suit makes real the vexation engendered by

duplicitous litigation, the embarrassment of intruding into the affairs of
another sovereign, and the squandering of judicial efforts in resolving a
dispute already lodged and better resolved elsewhere.

We deem it more appropriate and in the greater interest of prudence that

a defendant not only allege supposed dangerous tendencies in litigating

173
in this jurisdiction; the defendant must also show that such danger is real
and present in that litigation or dispute resolution has commenced in
another jurisdiction a nd that a foreign tribunal has chosen to exercise
jurisdiction.

2. NO. In Puyat v. Zabarte, 352 SCRA 738 (2001), this court recognized
the following situations as among those that may warrant a court’s
desistance from exercising jurisdiction:
1) The belief that the matter can be better tried and decided elsewhere,
either because the main aspects of the case transpired in a foreign
jurisdiction or the material witnesses have their residence there;
2) The belief that the nonresident plaintiff sought the forum, a practice
known as forum shopping, merely to secure procedural advantages or to
convey or harass the defendant;
3) The unwillingness to extend local judicial facilities to nonresidents
or aliens when the docket may already be overcrowded;
4) The inadequacy of the local judicial machinery for effectuating the
right sought to be maintained; and
5) The difficulty of ascertaining foreign law.

In this case, the circumstances of the parties and their relation do not
approximate the circumstances enumerated in Puyat, which this court
recognized as possibly justifying the desistance of Philippine tribunals
from exercising jurisdiction.

First, there is no basis for concluding that the case can be more
conveniently tried elsewhere. As established earlier, Saudia is doing
business in the Philippines. For their part, all four (4) respondents are
Filipino citizens maintaining residence in the Philippines and, apart from
their previous employment with Saudia, have no other connection to the
Kingdom of Saudi Arabia. It would even be to respondents’
inconvenience if this case were to be tried elsewhere.

Second, the records are bereft of any indication that respondents filed
their Complaint in an effort to engage in forum shopping or to vex and
inconvenience Saudia.

174
Third, there is no indication of “unwillingness to extend local judicial
facilities to nonresidents or aliens.” That Saudia has managed to bring the
present controversy all the way to this court proves this.

Fourth, it cannot be said that the local judicial machinery is inadequate for
effectuating the right sought to be maintained. Summons was properly
served on Saudia and jurisdiction over its person was validly acquired.

Lastly, there is not even room for considering foreign law. Philippine law
properly governs the present dispute.

Even if we were to assume, for the sake of discussion, that it is the laws of
Saudi Arabia which should apply, it does not follow that Philippine
tribunals should refrain from exercising jurisdiction.

175
 IN THE MATTER OF: SAVE THE SUPREME COURT JUDICIAL
INDEPENDENCE AND FISCAL AUTONOMY MOVEMENT VS.
ABOLITION OF JUDICIARY DEVELOPMENT FUND (JDF) AND
REDUCTION OF FISCAL AUTONOMY
UDK – 15143
January 21, 2015
Leonen, J.

DOCTRINE:
The writ of mandamus will issue when the act sought to be performed is
ministerial. An act is ministerial when it does not require the exercise of
judgment and the act is performed in compliance with a legal mandate. In a
petition for mandamus, the burden of proof is on petitioner to show that one is
entitled to the performance of a legal right and that respondent has a
corresponding duty to perform the act. Mandamus will not lie “to compel an
official to do anything which is not his duty to do or which it is his duty not to
do, or to give to the applicant anything to which he is not entitled by law.”

FACTS:
This case involves the proposed bills abolishing the Judiciary
Development Fund1 and replacing it with the “Judiciary Support Fund.”
Funds collected from the proposed Judiciary Support Fund shall be
remitted to the national treasury and Congress shall determine how the
funds will be used.
Petitioner Rolly Mijares (Mijares) prays for the issuance of a writ of
mandamus in order to compel this court to exercise its judicial
independence and fiscal autonomy against the perceived hostility of
Congress.
Petitioner argues that Congress “gravely abused its discretion with a
blatant usurpation of judicial independence and fiscal autonomy of the
Supreme Court.”16
Petitioner points out that Congress is exercising its power “in an arbitrary
and despotic manner by reason of passion or personal hostility by
abolishing the ‘Judiciary Development Fund’ (JDF) of the Supreme
Court.”

176
ISSUE:
Whether or not the petitioner, Rolly Mijares, has sufficiently shown
grounds for this court to grant the petition and issue a writ of mandamus.

HELD:
NO. The writ of mandamus will issue when the act sought to be
performed is ministerial. An act is ministerial when it does not require the
exercise of judgment and the act is performed in compliance with a legal
mandate. In a petition for mandamus, the burden of proof is on petitioner
to show that one is entitled to the performance of a legal right and that
respondent has a corresponding duty to perform the act. Mandamus will
not lie “to compel an official to do anything which is not his duty to do or
which it is his duty not to do, or to give to the applicant anything to
which he is not entitled by law.”

Mijares is asking this court to stop Congress from passing laws that will
abolish the Judiciary Development Fund. This court has explained that
the filing of bills is within the legislative power of Congress and is “not
subject to judicial restraint.” A proposed bill produces no legal effects
until it is passed into law. Under the Constitution, the judiciary is
mandated to interpret laws. It cannot speculate on the constitutionality or
unconstitutionality of a bill that Congress may or may not pass. It cannot
rule on mere speculations or issues that are not ripe for judicial
determination.36 The petition, therefore, does not present any actual case
or controversy that is ripe for this court’s determination.

In this case, petitioner has not shown how he is entitled to the relief
prayed for. Hence, this court cannot be compelled to exercise its power of
judicial review since there is no actual case or controversy.

177
 STRONGHOLD INSURANCE COMPANY, INC. VS. STROEM
GR NO. 204689
January 21, 2015
Leonen, J.

DOCTRINE:
Generally, parties may not raise issues for the first time on appeal. Such practice
is violative of the rules and due process and is frowned upon by the courts.
However, it is also well-settled that jurisdiction can never be waived or acquired
by estoppel. Jurisdiction is conferred by the Constitution or by law. “Lack of
jurisdiction of the court over an action or the subject matter of an action cannot
be cured by the silence, by acquiescence, or even by express consent of the
parties.”

FACTS:
Spouses Stroem filed a Complaint for breach of contract with
damages against Asis-Leif, Ms. Cynthia Asis-Leif, and Stronghold. Only
Stronghold was served summons. Ms. Cynthia Asis-Leif allegedly
absconded and moved out of the country.

The RTC ruled in favor of Stroem. Stronghold then filed a motion for
rrecosideration alleging that the RTC did not have jurisdiction to decide
the case since the Construction Industry Arbitration Commission (CIAC)
has exclusive and original jurisdiction over disputes arising from
construction contracts.

Stroem argues that Stronghold committed forum shopping; hence, the

case should have been dismissed outright. Records show that Stronghold
received a copy of the Decision of the Court of Appeals on December 5,
2012. Stronghold did not file a Motion for Reconsideration of the assailed
Decision. It filed before this court a Motion for Extension of Time To File
Petition for Review requesting an additional period of 30 days from
December 20, 2012 or until January 19, 2013 to file the Petition.

Stroem filed their Motion for Partial Reconsideration of the Court of

Appeals Decision on December 11, 2012. They sought the modification of

178
the Decision as to the amounts of moral damages, exemplary damages,
attorney’s fees, and costs of the suit. Stroem argue that Stronghold
committed forum shopping warranting dismissal of the case. According
to the Spouses Stroem, Stronghold deliberately committed forum
shopping when it filed the present petition despite the pendency of the
Spouses Stroem’s Motion for Partial Reconsideration of the Court of
Appeals Decision dated November 20, 2012.

For its part, Stronghold claims that it did not commit forum shopping. It
fully disclosed in its Petition that what it sought to be reviewed was the
Decision dated November 20, 2012 of the Court of Appeals. “Petitioner
merely exercised its available remedy with respect to the Decision of the
Court of Appeals by filing the Petition.” What the rules mandate to be
stated in the Certification Against Forum Shopping is the status of “any
other action.” This other action involves the same issues and parties but is
an entirely different case.

ISSUE:
Whether or not Stronghold committed forum shopping.

RULING:
YES. There is forum shopping when 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 not only with respect to suits
filed in the courts but also in connection with litigations commenced in
the courts while an administrative proceeding is pending.
The elements of forum shopping are:
(a) identity of parties, or at least such parties as represent the same
interests in both actions;
(b) identity of rights asserted and reliefs prayed for, the reliefs being
founded on the same facts; and
(c) the identity with respect to the two preceding particulars in the two
cases is such that any judgment rendered in the pending cases, regardless
of which party is successful, amount to res judicata in the other case.

179
Rule 42, Section 245 in relation to Rule 45, Section 4 of the Rules of Court
mandates petitioner to submit a Certification Against Forum Shopping
and promptly inform this court about the pendency of any similar action
or proceeding before other courts or tribunals. The rule’s purpose is to
deter the unethical practice of pursuing simultaneous remedies in
different forums, which “wreaks havoc upon orderly judicial procedure.”
Failure to comply with the rule is a sufficient ground for the dismissal of
the petition.
What is truly important to consider in determining whether forum
shopping exists or not is the vexation caused the courts and parties-
litigant by a party who asks different courts and/or administrative
agencies to rule on the same or related causes and/or to 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
issue. Stronghold Insurance Company, Inc. vs. Stroem, 746 SCRA 598,
G.R. No. 204689 January 21, 2015

180
 THE DIOCESE OF BACOLOD VS. COMMISSION ON ELECTIONS
GR NO. 205728
January 21, 2015
Leonen, J.

DOCTRINE:
Rule 64 is not the exclusive remedy for all acts of the COMELEC. Rule 65 is
applicable especially to raise objections relating to a grave abuse of discretion
resulting in the ouster of jurisdiction. As a special civil action, there must also be
a showing that there be no plain, speedy, and adequate remedy in the ordinary
course of the law.

FACTS:
Petitioners posted two (2) tarpaulins within a private compound
housing the San Sebastian Cathedral of Bacolod. Each tarpaulin was
approximately six feet (6′) by ten feet (10′) in size. They were posted on
the front walls of the cathedral within public view. The first tarpaulin
contains the message “IBASURA RH Law” referring to the Reproductive
Health Law of 2012 or Republic Act No. 10354. The second tarpaulin is the
subject of the present case. This tarpaulin contains the heading
“Conscience Vote” and lists candidates as either “(Anti-RH) Team Buhay”
with a check mark, or “(Pro-RH) Team Patay” with an “X” mark. The
electoral candidates were classified according to their vote on the
adoption of Republic Act No. 10354, otherwise known as the RH Law.
Those who voted for the passing of the law were classified by petitioners
as comprising “Team Patay,” while those who voted against it form
“Team Buhay.”

Respondents contend that the assailed notice and letter are not subject to
review by this court, whose power to review is “limited only to final
decisions, rulings and orders of the COMELEC En Banc rendered in the
exercise of its adjudicatory or quasi-judicial power.” Instead, respondents
claim that the assailed notice and letter are reviewable only by COMELEC
itself pursuant to Article IX-C, Section 2(3) of the Constitution on
COMELEC’s power to decide all questions affecting elections.

181
ISSUE:
Whether or not the petitioner’s invocation of Rule 64 is the proper
remedy.

RULING:
NO. As a general rule, an administrative order of the Comelec is not an
appropriate subject of a special civil action for certiorari. the Court
reviews Comelec’s administrative acts only by way of exception, when it
acts capriciously or whimsically, with grave abuse of discretion
amounting to lack or excess of jurisdiction. Necessarily, this invokes the
Court’s expanded jurisdiction under the second paragraph of Article VIII,
Section 1.

That there is an alleged grave abuse of discretion on the part of Comelec,

however, does not automatically mean that the petition should be given
due course. It has to meet the requirements of justiciability which, under
the terms of the Court’s expanded judicial power, has been translated to
mean a prima facie showing of a governmental entity, office or official
granted discretionary authority to act and that this authority has been
gravely abused. There can be no prima facie showing of grave abuse of
discretion unless something has already been done or has taken place
under the law and the petitioner sufficiently alleges the existence of a
threatened or immediate injury to itself as a result of the gravely abusive
exercise of discretion.

By immediately invoking remedies before this Court, the petitioners

deprived the Comelec itself of the opportunity to pass upon the issue
before us — a procedure critical in a certiorari proceeding. In short, the
direct invocation of judicial intervention is clearly premature.

182
 FLOR G. DAYO VS. STATUS MARITIME CORPORATION
GR NO. 210660
January 21, 2015
Leonen, J.

DOCTRINE:
In deciding a Rule 45 Petition for Review on Certiorari of a Court of Appeals’
Decision in a Rule 65 Petition for Certiorari, this court is limited to determining
whether the Court of Appeals was correct in establishing the presence or absence
of grave abuse of discretion.

FACTS:
Eduardo P. Dayo (Dayo) was hired by Status Maritime Corporation
(SMC) for and on behalf of Nafto Trade Shipping Commercial S.A. Dayo
embarked on June 8, 2008. On September 5, 2008, he “experienced severe
pain on his hips and both knees, and total body weakness.” He was given
medical attention in Bridgetown, Barbados, where he was diagnosed with
hypertension. He was repatriated on September 7, 2008.

After arrival, Dayo was examined by the Company Doctor and was
diagnosed with diabetes mellitus. Later on, after hhis contract has
expired, he died. Flor, the beneficiary of Dayo is now claiming benefits in
favor of Dayo as provided for under labor laws and their contract.
Subsequently,the Labor Arbiter (LA) ruled in favor of Flor.

SMC then appealed the decision with the NLRC which reversed the
previous ruling by the LA. Flor filed a Motion for Reconsideration, but it
was denied.

She then filed a Petition for Certiorari before the Court of Appeals,
arguing that her husband died from a work-related illness, thus, it was
grave abuse of discretion for the National Labor Relations Commission to
reverse the Labor Arbiter’s ruling. The Court of Appeals denied the
petition, ruling that since Eduardo died after the term of his contract with
Status Maritime Corporation, “his beneficiaries are not entitled to the
death benefits.

183
On the other hand, respondents argue that the Court of Appeals’ ruling
was correct since Eduardo died after the term of his contract.36 His
illness, diabetic polyneuropathy secondary to diabetes, is not included in
the list of occupational diseases. Petitioner failed to show the causation
between Eduardo’s work and illness leading up to his death. Petitioner
did not even refute the findings of the company-designated physician.

ISSUE:
Whether or not the Court of Appeals correctly determined that there was
no grave abuse of discretion on the part of the National Labor Relations
Commission when it denied petitioner Flor G. Dayo’s claim for death
benefits.

RULING:
NONE. Settled is the rule that for illness to be compensable, it is not
necessary that the nature of the employment be the sole and only reason
for the illness suffered by the seafarer. It is sufficient that there is a
reasonable linkage between the disease suffered by the employee and his
work to lead a rational mind to conclude that his work may have
contributed to the establishment or, at the very least, aggravation of any
preexisting condition he might have had.

Petitioner was unable to fulfill these requirements. She did not allege how
the nature of Eduardo’s work contributed to the development or the
aggravation of his illness. Further, he himself admitted that he had
diabetes and hypertension prior to his embarkation. Considering that
diabetes mellitus is not listed as an occupational disease under the 2000
POEA-SEC and considering that petitioner did not prove how Eduardo’s
occupation contributed to the development of his illness, no error can be
attributed to the Court of Appeals when it affirmed the National Labor
Relations Commission’s Decision and Resolution.

However, petitioner did not allege facts that would sway this court to
grant the Petition. She did not present evidence to show how Eduardo’s
diabetes mellitus was aggravated by his work and how his illness caused

184
his death. On the contrary, petitioner’s allegations further convinced this
court that the Court of Appeals did not err in its Decision.

185
 RICHARD RICALDE, Petitioner,
vs.
PEOPLE OF THE PHILIPPINES, Respondent.
G.R. No. 211002
January 21, 2015
LEONEN, J.:

DOCTRINE:

SEC. 4. Judgment in case of variance between allegation and proof.—When there

is variance between the offense charged in the complaint or information and that
proved, and the offense as charged is included in or necessarily includes the
offense proved, the accused shall be convicted of the offense proved which is
included in the offense charged, or of the offense charged which is included in the
offense proved.

FACTS:

On January 30, 2002, at around 2:00 a.m., XXX, then 10 years old,
woke up as “he felt pain in his anus and stomach and something inserted
in his anus.” He saw that Ricalde, 31 years old, a distant relative and
textmate of XXX, “fondled his penis.” When Ricalde returned to the sofa,
XXX ran toward his mother’s room to tell her what happened. He also
told his mother that Ricalde played with his sexual organ.

RTC found Ricalde guilty beyond reasonable doubt of rape

through sexual assault. CA affirmed the conviction but lowered the
amount of damages.

ISSUE:

Whether or not the invocation of “variance doctrine” is proper.

186
HELD:

NO

Variance doctrine

Variance doctrine is provided under Sections 4 and 5 of Rule 120

of the Rules on Criminal Procedure. It states:

SEC. 4. Judgment in case of variance between allegation and proof.—

When there is variance between the offense charged in the complaint or
information and that proved, and the offense as charged is included in or
necessarily includes the offense proved, the accused shall be convicted of
the offense proved which is included in the offense charged, or of the
offense charged which is included in the offense proved.

SEC. 5. When an offense includes or is included in another.—An offense

charged necessarily includes the offense proved when some of the
essential elements or ingredients of the former, as alleged in the
complaint or information, constitute the latter. And an offense charged is
necessarily included in the offense proved, when the essential ingredients
of the former continue or form part of those constituting the latter.

In the instant case, no variance exists between what was charged

and what was proven during trial. The prosecution established beyond
reasonable doubt all elements of the crime of rape through sexual assault.

187
 HENRY ONG LAY HIN, Petitioner,
vs.
COURT OF APPEALS (2nd Division), HON. GABRIEL T. INGLES, as
Presiding Judge of RTC Branch 58, Cebu City, and the PEOPLE OF THE
PHILIPPINES, Respondents.
G.R. No. 191972
January 26, 2015
LEONEN, J.:
DOCTRINE:
Grave abuse of discretion is the “arbitrary or despotic exercise of power due to
passion, prejudice or personal hostility; or the whimsical, arbitrary, or a
capricious exercise of power that amounts to an evasion or a refusal to perform a
positive duty enjoined by law or to act at all in contemplation of law.”

FACTS:

February 8, 2000, the Regional Trial Court convicted petitioner

Henry Ong Lay Hin (Ong) and Leo Obsioma, Jr. (Obsioma, Jr.) of estafa
punished under the Revised Penal Code. The trial court found that Ong
and Obsioma, Jr. failed to pay Metropolitan Bank and Trust Company a
total of 344,752.20php, in violation of their trust receipt agreement with
the bank.
Ong filed a Motion for Reconsideration, which the trial court denied in its
Order.

Ong filed a Notice of Appeal, which the trial court gave due course. The
trial court then transmitted the case records to the Court of Appeals.

The Court of Appeals affirmed in toto the trial court’s Decision. The Court
of Appeals likewise denied Ong’s Motion for Reconsideration and
Supplemental Motion for Reconsideration in its Resolution, for raising
mere rehashed arguments.

188
The Court of Appeals then issued an Entry of Judgment, declaring that
the case became final and executory.

The trial court received the original records of the case, the Decision, and
the Entry of Judgment issued by the Court of Appeals. In view thereof,
the trial court, ordered the arrest of Ong.

Almost six (6) years after, Ong was arrested. He was initially ordered
committed to the Cebu City Jail but is currently serving his sentence at the
New Bilibid Prison.

Ong filed before this court a Petition for Certiorari, Prohibition, and
Mandamus with application for issuance of preliminary and/or
mandatory injunction.

The People of the Philippines then filed a Comment on the Petition for
Certiorari, Prohibition, and Mandamus. It also commented on Ong’s
Motion for Preliminary Injunction or, Alternatively, for Bail.

In his Petition for Certiorari, Ong alleges that his counsel never received a
copy of the Court of Appeals’ Resolution denying his Motion for
Reconsideration. Consequently, the Decision of the Court of Appeals
never became final and executory, and the Court of Appeals gravely
abused its discretion in issuing the Entry of Judgment. Judge Gabriel T.
Ingles likewise gravely abused his discretion in issuing a warrant for his
arrest and ordering his commitment to the Cebu City Jail.

Considering the alleged grave abuse of discretion of the Court of Appeals

and the trial court, Ong prays that this court issue a Writ of Preliminary
Mandatory Injunction for him to be “liberated from his illegal
imprisonment.” In the alternative, he prays that this court allow him to

189
post bail for his provisional liberty while this court decides his Petition for
Certiorari.

The People contends to Ong’s prayer for issuance of a Writ of Preliminary

Mandatory Injunction, that he “failed to point out specific instances
where the Court of Appeals and the trial court had committed grave
abuse of discretion. Consequently, Ong is not entitled to the Writ prayed
for.

ISSUES:

1. Whether the Court of Appeals gravely abused its

discretion in issuing the entry of judgment;
2. Whether the trial court gravely abused its discretion in
issuing the warrant of arrest and commitment order against
petitioner Henry Ong Lay Hin

RULING:

NO.

There is no grave abuse of discretion in this case

Grave abuse of discretion is the “arbitrary or despotic exercise of power

due to passion, prejudice or personal hostility; or the whimsical, arbitrary,
or a capricious exercise of power that amounts to an evasion or a refusal
to perform a positive duty enjoined by law or to act at all in
contemplation of law.”

In the present case, petitioner failed to prove the Court of Appeals’ and
trial court’s grave abuse of discretion.

190
The registry return card is the “official record evidencing service by
mail.” It “carries the presumption that it was prepared in the course of
official duties that have been regularly performed and therefore it is
presumed to be accurate, unless proven otherwise.

Petitioner failed to rebut this presumption.

The affidavits of petitioner’s wife and mother-in-law, Mary Ann Ong and
Nila Mapilit, stating that petitioner’s former counsel told them that the
law office never received a copy of the Resolution, are inadmissible in
evidence for being hearsay. Moreover, contrary to petitioner’s false claim,
his former counsel had notice that the Court of Appeals denied the
Motion for Reconsideration as early as April 21, 2004 when his counsel
received a copy of the trial court’s Order directing the issuance of a
warrant of arrest against petitioner.54cralawred

With petitioner failing to rebut this presumption, it must be presumed

that his former counsel received a copy of the Resolution on April 29, 2003
as indicated in the registry return card. The 15-day period to appeal
commenced from this date. Since petitioner did not file an Appeal within
15 days from April 29, 2003, the Decision became final and executory on
May 15, 2003.

Consequently, the Court of Appeals did not gravely abuse its discretion in
issuing the Entry of Judgment, which declared petitioner’s conviction
final and executory as of May 15, 2003. Under Rule 51, Section 10 of the
Rules of Court on “Judgment,” “if no appeal or motion for new trial or
reconsideration is filed within the time provided in these Rules, the
judgment or final resolution shall forthwith be entered by the clerk in the
book of entries of judgments. The date when the judgment or final
resolution becomes executory shall be deemed as the date of its entry.”

191
As for the trial court, it likewise did not gravely abuse its discretion in
issuing the arrest warrant against petitioner and ordering his commitment
to the Cebu City Jail. Since the Court of Appeals had already issued the
Entry of Judgment and had remanded to the trial court the original
records of the case, it became the trial court’s duty to execute the
judgment.

192
PROTECTIVE MAXIMUM SECURITY AGENCY, INC., PETITIONER,
VS. CELSO E. FUENTES, RESPONDENT.
G.R. No. 169303
February 11, 2015
LEONEN, J.:

DOCTRINE:
The general rule is that in a Rule 45 petition for review on certiorari, this court
will not review the factual determination of the administrative bodies governing
labor, as well as the findings of fact by the Court of Appeals. The Court of
Appeals can conduct its own factual determination to ascertain whether the
National Labor Relations Commission has committed grave abuse of discretion.
"In the exercise of its power of review, the findings of fact of the Court of Appeals
are conclusive and binding and consequently, it is not our function to analyze or
weigh evidence all over again."

FACTS:

Protective Maximum Security Agency, Inc. (Protective) provides

security services for commercial, industrial and agricultural firms, and
personal residences.

Celso E. Fuentes (Fuentes) was hired as a security guard by Protective

sometime. A group of armed persons ransacked Post 33 and took five (5)
M-16 rifles, three (3) carbine rifles, and one (1) Browning Automatic Rifle,
all with live ammunition and magazines. Agency-issued uniforms and
personal items were also taken.These armed persons inflicted violence
upon Fuentes and the other security guards present at Post 33.

On the same day of the incident, Fuentes and his fellow security guards
reported the raid to the Philippine National Police in Trento, Agusan del
Sur.

After its initial investigation, the Philippine National Police found reason
to believe that Fuentes conspired and acted in consort with the New

193
People's Army. This was based on the two (2) affidavits executed by
Lindo, Jr. and Cempron, who were both present raid. In their affidavits,
Lindo, Jr. and Cempron stated that Fuentes should be prosecuted for
criminal acts done.

The Philippine National Police, through Senior Police Officer IV Benjamin

Corda, Jr., filed the Complaint for robbery committed by a band against
Fuentes, a certain Mario Cabatlao, and others.

Immediately upon the filing of the Complaint, Fuentes was detained at

the Mangagoy Police Sub-Station, Mangagoy, Bislig, Surigao del Sur.

The Office of the Provincial Prosecutor of Surigao del Sur issued the
Resolution dismissing the Complaint against Fuentes. It found during
preliminary investigation that there was no probable cause to warrant the
filing of an Information against Fuentes.

Fuentes filed the Complaint "for illegal dismissal, non-payment of

salaries, overtime pay, premium pay for holiday and rest day, 13th month
pay, service incentive leave and damages against Protective.

Executive Labor Arbiter Rogelio P. Legaspi (Labor Arbiter Legaspi)

rendered his Decision in favor of Protective

On appeal, the National Labor Relations Commission reversed the

Decision of Labor Arbiter Legaspi and found that Fuentes was illegally
dismissed.

Protective filed a Petition for Certiorari before the Court of Appeals

alleging grave abuse of discretion on the part of the National Labor
Relations Commission.

The Court of Appeals dismissed the Petition.

194
ISSUES:

1. Whether or not the Court of Appeals’s power to decide a Rule 45

petition for review on certiorari, particularly in labor cases, has its limits.
2. whether procedural due process was violated

RULING:

1. Yes.

Petitioner prays that this court reverse the findings of fact of the National
Labor Relations Commission, which were affirmed by the Court of
Appeals.

In St. Martin Funeral Home v. National Labor Relations Commission, this

court established the proper mode of appeal in labor cases:

On this score we add the further observations that there is a growing

number of labor cases being elevated to this Court which, not being a trier
of fact, has at times been constrained to remand the case to the NLRC for
resolution of unclear or ambiguous factual findings; that the Court of
Appeals is procedurally equipped for that purpose, aside from the
increased number of its component divisions; and that there is undeniably
an imperative need for expeditious action on labor cases as a major aspect
of constitutional protection to labor.

Therefore, all references in the amended Section 9 of B.P. No. 129 to

supposed appeals from the NLRC to the Supreme Court are interpreted
and hereby declared to mean and refer to petitions for certiorari under
Rule 65. Consequently, all such petitions should henceforth be initially
filed in the Court of Appeals in strict observance of the doctrine on the
hierarchy of courts as the appropriate forum for the relief desired.
In Bani Rural Bank, Inc. v. De Guzman, this court discussed the primary
issues to be addressed in a Rule 45 petition for review on certiorari in
labor cases:

195
In question form, the question to ask is: Did the CA correctly determine whether
the NLRC committed grave abuse of discretion in ruling on the case?
This manner of review was reiterated in Holy Child Catholic School v. Hon.
Patricia Sto. Tomas, etc., et al., where the Court limited its review under
Rule 45 of the CA's decision in a labor case to the determination of
whether the CA correctly resolved the presence or absence of grave abuse
of discretion in the decision of the Secretary of Labor, and not on the basis
of whether the latter's decision on the merits of the case was strictly
correct.

Grave abuse of discretion, amounting to lack or excess of jurisdiction, has

been defined as the capricious and whimsical exercise of judgment
amounting to or equivalent to lack of jurisdiction. There is grave abuse of
discretion when the power is exercised in an arbitrary or despotic manner
by reason of "passion or personal hostility, and must be so patent and so
gross as to amount to an evasion of a positive duty or to a virtual refusal
to perform the duty enjoined or to act at all in contemplation of law."
In Career Philippines Shipmanagement, Inc. v. Serna, this court elaborated on
its role to determine whether the Court of Appeals was correct in either
granting or dismissing the petition for certiorari:
In a Rule 45 review, we consider the correctness of the assailed CA
decision, in contrast with the review for jurisdictional error that we
undertake under Rule 65. Furthermore, Rule 45 limits us to the review of
questions of law raised against the assailed CA decision. In ruling for
legal correctness, we have to view the CA decision in the same context
that the petition for certiorari it ruled upon was presented to it; we have to
examine the CA decision from the prism of whether it correctly determined the
presence or absence of grave abuse of discretion in the NLRC decision before it,
not on the basis of whether the NLRC decision on the merits of the case was
correct. In other words, we have to be keenly aware that the CA undertook
a Rule 65 review, not a review on appeal, of the NLRC decision
challenged before it.
Accordingly, we do not re-examine conflicting evidence, re-evaluate the
credibility of witnesses, or substitute the findings of fact of the NLRC, an
administrative body that has expertise in its specialized field. Nor do we
substitute our "own judgment for that of the tribunal in determining where the

196
weight of evidence lies or what evidence is credible." The factual findings of the
NLRC, when affirmed by the CA, are generally conclusive on this Court.
Applying these cases, the general rule is that in a Rule 45 petition for
review on certiorari, this court will not review the factual determination
of the administrative bodies governing labor, as well as the findings of
fact by the Court of Appeals. The Court of Appeals can conduct its own
factual determination to ascertain whether the National Labor Relations
Commission has committed grave abuse of discretion. "In the exercise of
its power of review, the findings of fact of the Court of Appeals are
conclusive and binding and consequently, it is not our function to analyze
or weigh evidence all over again."

There are exceptions to the general rule that the findings of fact of labor
tribunals, as affirmed by the Court of Appeals, are binding on this court.
In Medina v. Asistio, Jr:
It is a well-settled rule in this jurisdiction that only questions of law may
be raised in a petition for certiorari under Rule 45 of the Rules of Court,
this Court being bound by the findings of fact made by the Court of
Appeals. The rule, however, is not without exception. Thus, findings of
fact by the Court of Appeals may be passed upon and reviewed by this
Court in the following instances, none of which obtain in the instant
petition:

(1) When the conclusion is a finding grounded entirely on speculation,

surmises or conjectures (Joaquin v. Navarro, 93 Phil. 257 [1953]); (2) When
the inference made is manifestly mistaken, absurd or impossible (Luna v.
Linatok, 74 Phil. 15 [1942]); (3) Where there is a grave abuse of discretion
(Buyco v. People, 95 Phil. 453 [1955]); (4) When the judgment is based on a
misapprehension of facts (Cruz v. Sosing, L-4875, Nov. 27, 1953); (5) When
the findings of fact are conflicting (Casica v. Villaseca, L-9590 Ap. 30, 1957;
unrep.);** (6) When the Court of Appeals, in making its findings, went
beyond the issues of the case and the same is contrary to the admissions
of both appellant and appellee (Evangelista v. Alto Surety and Insurance Co.,
103 Phil. 401 [1958]); (7) The findings of the Court of Appeals are contrary
to those of the trial court (Garcia v. Court of Appeals, 33 SCRA 622 [1970];
Sacay v. Sandiganbayan, 142 SCRA 593 [1986]);** (8) When the findings of

197
fact are conclusions without citation of specific evidence on which they
are based (Ibid.,); (9) When the facts set forth in the petition as well as in
the petitioner's main and reply briefs are not disputed by the respondents
(Ibid.,); and (10) The finding of fact of the Court of Appeals is premised on
the supposed absence of evidence and is contradicted by the evidence on
record (Salazar v. Gutierrez, 33 SCRA 242 [1970]).

In labor cases, if the petitioner before this court can show grave abuse of
discretion on the part of trie National Labor Relations Commission, the
assailed Court of Appeals ruling (in the Rule 65 proceedings) will be
reversed. "Labor officials commit grave abuse of discretion when their A
factual findings are arrived at arbitrarily or in disregard of the
evidence."82 If the petitioner can show that "the [labor] tribunal acted
capriciously and whimsically or in total disregard of evidence material to
the controversy," the factual findings of the National Labor Relations
Commission may be subjected to review and ultimately rejected.84

In addition, if the findings of fact of the Labor Arbiter are in direct conflict
with the National Labor Relations Commission, this court may examine
the records of the case and the questioned findings in the exercise of its
equity jurisdiction.

It is the petitioner's burden to justify the existence of one of the exceptions

to the general rule for this court to conduct a factual review. In this case,
we find that petitioner has failed to discharge this burden.

2, YES. Respondent's right to procedural due process was not observed.

The employer must always observe the employee's right to due process.
In Agabon:

Procedurally ... if the dismissal is based on a just cause under Article 282,
the employer must give the employee two written notices and a hearing
or opportunity to be heard if requested by the employee before
terminating the employment: a notice specifying the grounds for which
dismissal is sought a hearing or an opportunity to be heard and after
hearing or opportunity to be heard, a notice of the decision to dismiss. . . .

198
Due process under the Labor Code, like Constitutional due process, has
two aspects: substantive, i.e., the valid and authorized causes of
employment termination under the Labor Code; and procedural, i.e., the
manner of dismissal. Procedural due process requirements for dismissal
are found in the Implementing Rules of P.D. 442, as amended, otherwise
known as the Labor Code of the Philippines in Book VI, Rule I, Sec. 2, as
amended by Department Order Nos. 9 and 10. Breaches of these due
process requirements violate the Labor Code.

Constitutional due process protects the individual from the government

and assures him of his rights in criminal, civil or administrative
proceedings; while statutory due process found in the Labor Code and
Implementing Rules protects employees from being unjustly terminated
without just cause after notice and hearing.

In this case, petitioner violated respondent's right to procedural due

process. The two-notice requirement was not followed. Petitioner sought
to excuse itself by claiming that there was no address where the proper
notice could have been served. However, petitioner admitted before the
Court of Appeals that "respondent's last known address was given to the
investigating court by Police Inspector Escartin.”

There was no attempt from petitioner to serve the proper notice on

respondent at the address contained in its employment records.
Respondent was replaced without being given an opportunity to explain
his absence.

199
 ANGELITA CRUZ BENITO, Petitioner,
vs.
PEOPLE OF THE PHILIPPINES, Respondent.

G.R. No. 204644

February 11, 2015

LEONEN, J.:

DOCTRINE:

A question of fact exists "when the doubt or difference arises as to the truth or the
falsehood of alleged facts." On the other hand, a question of law exists "when the
doubt or difference arises as to what the law is on a certain state of facts."

FACTS:

Abadilla and Agbulos entered into several transactions for the sale of
jewelry, with Agbulos going to Abadilla’s residence at 174 Maginhawa
Street, Sikatuna Village, Quezon City. In all these transactions, Benito
accompanied Agbulos.

Agbulos received pieces of jewelry from Abadilla. They agreed that

Agbulos would return the pieces of jewelry in the afternoon should
Agbulos fail to sell them. Agbulos then issued Abadilla a check for the
value of the jewelry received.

Agbulos received another batch of jewelry from Abadilla. She again

issued Abadilla a check, this time for ₱828,000.00. They likewise agreed
that Agbulos would return the jewelry in the afternoon should she fail to
sell them.

On June 16, 1994, Agbulos received the last batch of jewelry from
Abadilla, issuing a check in the amount of ₱453,000.00.

200
On June 21, 1994, Abadilla called Agbulos on the phone, asking for
security for the pieces of jewelry she gave Agbulos. Agbulos then gave as
security the owner’s copy of Transfer Certificate of Title.

However, upon verification with the Land Registration Authority, the

certificate of title turned out to be spurious.

Abadilla deposited the checks Agbulosissued to her, and all were

dishonored by reason of "closed account." Abadilla then tried to locate
Agbulos, but Agbulos could no longer be found.

After several months, Abadilla learned from Agbulos’ sister-in-law that

the latter received pawn tickets from a friend. Abadilla, through her
friend Pamintuan, obtained from Agbulos’ sister-in-law pawn tickets
numbered 45227 and 45306 issued by E. Ochoa Pawnshop. Appearing on
the pawn tickets was the name "Linda Chua."

Abadilla went to E. Ochoa Pawnshop to verify the items described in the

pawn tickets. She learned that the items pawned were among the pieces
of jewelry she turned over to Agbulos, specifically, a men’s diamond ring
and a set of diamond ring and earrings. She also learned from Diloria, the
pawnshop appraiser, that the "Linda Chua" who pawned her jewelry was
Benito.

The Regional Trial Court found that the prosecution proved beyond
reasonable doubt that Agbulos and Benito conspired to commit estafa.

The Court of Appeals affirmined in toto the trial court’s Decision, the
Court of Appeals denied Benito’s appeal in the Decision.

Benito filed a Motion for Reconsideration, which the Court of Appeals

denied in the Resolution.

ISSUE:

Whether or not the judgments of the Regional Trial Court and the Court
of Appeals are based on a misapprehension of facts

201
RULING:

YES

Under Rule 45, Section 1 of the Rules of Court, only questions of law may
be raised in a Petition for Review on Certiorari:

Section 1. Filing of petition with Supreme Court. – A party desiring to

appeal by certiorari from a judgment, final order or resolution of the
Court of Appeals, the Sandiganbayan, the Court of Tax Appeals, the
Regional Trial Court or other courts, whenever authorized by law, may
file with the Supreme Court a verified petition for review on certiorari.
The petition may include an application for a writ of preliminary
injunction or other provisional remedies and shall raise only questions of
law, which must be distinctly set forth. The petitioner may seek the same
provisional remedies by verified motion filed in the same action or
proceeding at any time during its pendency.

As an exception to the rule, questions of fact may be raised in a Rule 45

Petition if any of the following is present:

(1) when there is grave abuse of discretion; (2) when the findings are
grounded on speculations; (3) when the inference made is manifestly
mistaken; (4) when the judgment of the Court of Appeals is based on a
misapprehension of facts; (5) when the factual findings are conflicting; (6)
when the Court of Appeals went beyond the issues of the case and its
findings are contrary to the admissions of the parties; (7) when the Court
of Appeals overlooked undisputed facts which, if properly considered,
would justify a different conclusion; (8) when the findings of the Court of
Appeals are contrary to those of the trial court; (9) when the facts set forth
by the petitioner are not disputed by the respondent; and (10) when the
findings of the Court of Appeals are premised on the absence of evidence
and are contradicted by the evidence on record.

A question of fact exists "when the doubt or difference arises as to the

truth or the falsehood of alleged facts." On the other hand, a question of
law exists "when the doubt or difference arises as to what the law is on a
certain state of facts."

202
Benito raises questions of fact in her Petition for Review on Certiorari.
Specifically, she prays that this court examine the truth of the following
findings: that she received jewelry from Abadilla and that she posed as
"Linda Chua" and pawned the jewelry she received from Abadilla.

Despite Benito raising questions off act in her Petition for Review on
Certiorari, we nevertheless take cognizance of her Petition. The trial court
and Court of Appeals misapprehended the facts of this case.

203
 ZENAIDA PAZ, Petitioner,
vs.
NORTHERN TOBACCO REDRYING CO., INC., AND/OR ANGELO
ANG, Respondents.

G.R. No. 199554

February 18, 2015

LEONEN, J.:

DOCTRINE:

The employer should be held liable for noncompliance with the procedural
requirements of due process

FACTS:

NTRCI hired Zenaida Paz (Paz) sometime in 1974 as a seasonal

sorter, paid daily. NTRCI regularly re-hired her every tobacco season
since then. She signed a seasonal job contract at the start of her
employment and a pro-forma application letter prepared by NTRCI in
order to qualify for the next season.

Paz was 63 years old when NTRCI informed her that she was considered
retired under company policy. A year later, NTRCI told her she would
receive ₱12,000.00 as retirement pay.

Paz, with two other complainants, filed a Complaint for illegal dismissal
against NTRCI on March 4, 2004. She amended her Complaint on April
27, 2004 into a Complaint for payment of retirement benefits, damages,
and attorney’s fees as ₱12,000.00 seemed inadequate for her 29 years of
service. The Complaint impleaded NTRCI’s Plant Manager, Angelo Ang,
as respondent. The Complaint was part of the consolidated Complaints of
17 NTRCI workers.

204
NTRCI countered that no Collective Bargaining Agreement (CBA) existed
between NTRCI and its workers. Thus, it computed the retirement pay of
its seasonal workers based on Article 287 of the Labor Code.

NTRCI raised the requirement of at least six months of service a year for
that year to be considered in the retirement pay computation. It claimed
that Paz only worked for at least six months in 1995, 1999, and 2000 out of
the 29 years she rendered service. Thus, Paz’s retirement pay amounted to
₱12,487.50 after multiplying her ₱185.00 daily salary by 221/2 working
days in a month, for three years.

The Labor Arbiter in his Decision confirmed that the correct retirement
pay of Zenaida M. Paz was ₱12,487.50."

The National Labor Relations Commission in its Decision modified the

Labor Arbiter’s Decision. It likewise denied reconsideration.

The Court of Appeals in its Decision dismissed the Petition and modified
the National Labor Relations Commission’s Decision in that "financial
assistance is awarded to Zenaida Paz in the amount of ₱60,356.25":

ISSUE:

Whether or not NTRCI complied with the due process

RULING:

No.

Dismissals based on just causes contemplate acts or omissions attributable

to the employee while dismissals based on authorized causes involve
grounds under the Labor Code which allow the employer to terminate
employees. A termination for an authorized cause requires payment of
separation pay. When the termination of employment is declared illegal,
reinstatement and full backwages are mandated under Article 279. If

205
reinstatement is no longer possible where the dismissal was unjust,
separation pay may be granted.

Procedurally, (1) if the dismissal is based on a just cause under Article

282, the employer must give the employee two written notices and a
hearing or opportunity to be heard if requested by the employee before
terminating the employment: a notice specifying the grounds for which
dismissal is sought a hearing or an opportunity to be heard and after
hearing or opportunity to be heard, a notice of the decision to dismiss;
and (2) if the dismissal is based on authorized causes under Articles 283
and 284, the employer must give the employee and the Department of
Labor and Employment written notices 30 days prior to the effectivity of
his separation.

From the foregoing rules four possible situations may be derived: (1) the
dismissal is for a just cause under Article 282 of the Labor Code, for an
authorized cause under Article 283, or for health reasons under Article
284, and due process was observed; (2) the dismissal is without just or
authorized cause but due process was observed; (3) the dismissal is
without just or authorized cause and there was no due process; and (4)
the dismissal is for just or authorized cause but due process was not
observed.

In the first situation, the dismissal is undoubtedly valid and the employer
will not suffer any liability.

In the second and third situations where the dismissals are illegal, Article
279 mandates that the employee is entitled to reinstatement without loss
of seniority rights and other privileges and full backwages, inclusive of
allowances, and other benefits or their monetary equivalent computed
from the time the compensation was not paid up to the time of actual
reinstatement.

In the fourth situation, the dismissal should be upheld. While the

procedural infirmity cannot be cured, it should not invalidate the
dismissal. However, the employer should be held liable for
noncompliance with the procedural requirements of due process. Agabon
focused on the fourth situation when dismissal was for just or authorized

206
cause, but due process was not observed. Agabon involved a dismissal for
just cause, and this court awarded ₱30,000.00 as nominal damages for the
employer’s non-compliance with statutory due process. Jaka Food
Processing Corporation v. Pacot involved a dismissal for authorized
cause, and this court awarded ₱50,000.00 as nominal damages for the
employer’s non-compliance with statutory due process. The difference in
amounts is based on the difference in dismissal ground. Nevertheless, this
court has sound discretion in determining the amount based on the
relevant circumstances. In De Jesus v. Aquino, this court awarded
₱50,000.00 as nominal damages albeit the dismissal was for just cause.
Petitioner Paz’s case does not fall under the fourth situation but under the
third situation on illegal dismissal for having no just or authorized cause
and violation of due process. Respondent NTRCI had considered
petitioner Paz retired at the age of 63 before she reached the compulsory
age of 65. This does not fall under the just causes for termination in
Article 282 of the Labor Code, the authorized causes for termination in
Article 283, or disease as a ground for termination in Article 284.

As regards due process, the Omnibus Rules Implementing the Labor

Code provides:

Section 2. Standard of due process: requirements of notice. – In all cases of

termination of employment, the following standards of due process shall
be substantially observed.

I. For termination of employment based on just causes as defined in

Article 282 of the Code:

(a) A written notice served on the employee specifying the ground or

grounds for termination, and giving to said employee reasonable
opportunity within which to explain his side;

(b) A hearing or conference during which the employee concerned, with

the assistance of counsel if the employee so desires, is given opportunity
to respond to the charge, present his evidence or rebut the evidence
presented against him; and

207
(c) A written notice [of] termination served on the employee indicating
that upon due consideration of all the circumstance, grounds have been
established to justify his termination.

There was no showing that respondent NTRCI complied with these due
process requisites. Thus, consistent with jurisprudence, petitioner Paz
should be awarded ₱30,000.00as nominal damages.

208
 NILO MACAYAN, JR. y MALANA, petitioner, vs. PEOPLE OF THE
PHILIPPINES, respondent.

G.R. No. 175842

March 18, 2015.*

Leonen, J.

DOCTRINE:

Remedial Law; Evidence; Proof Beyond Reasonable Doubt; Requiring proof

beyond reasonable doubt finds basis not only in the due process clause of the
Constitution, but similarly, in the right of an accused to be “presumed innocent
until the contrary is proved.”— Rule 133, Section 2 of the Revised Rules on
Evidence specifies the requisite quantum of evidence in criminal cases:
Section 2. Proof beyond reasonable doubt.—In a criminal case, the
accused is entitled to an acquittal, unless his guilt is shown beyond
reasonable doubt. Proof beyond reasonable doubt does not mean such a
degree of proof, excluding possibility of error, produces absolute
certainly. Moral certainly only is required, or that degree of proof which
produces conviction in an unprejudiced mind. This rule places upon the
prosecution the task of establishing the guilt of an accused, relying on the
strength of its own evidence, and not banking on the weakness of the
defense of an accused. Requiring proof beyond reasonable doubt finds
basis not only in the due process clause of the Constitution, but similarly,
in the right of an accused to be “presumed innocent until the contrary is
proved.” “Undoubtedly, it is the constitutional presumption of innocence
that lays such burden upon the prosecution.” Should the prosecution fail
to discharge its burden, it follows, as a matter of course, that an accused
must be acquitted.

Same; Criminal Procedure; Appeals; Petition for Review on Certiorari;

Consistent with Rule 45 of the Rules of Court, “[a]s a rule, only questions of law,
not questions of fact, may be raised in a petition for review on certiorari under
Rule 45.”—The determination of the guilt of an accused hinges on how a

209
court appreciates evidentiary matters in relation to the requisites of an
offense. Determination of guilt is, thus, a fundamentally factual issue.
This court, however, is not a trier of facts. Consistent with Rule 45 of the
Rules of Court, “[a]s a rule, only questions of law, not questions of fact,
may be raised in a petition for review on certiorari under Rule 45.” More
specifically, “in a criminal case, factual findings of the trial court are
generally accorded great weight and respect on appeal, especially when
such findings are supported by substantial evidence on record.”

Same; Same; Same; Speaking specifically of criminal cases, this court stated in
People of the Philippines v. Esteban, 725 SCRA 517 (2014), that “in exceptional
circumstances, such as when the trial court overlooked material and relevant
matters . . . the Supreme Court (SC) will recalibrate and evaluate the factual
findings of the [lower courts].”—There are exceptions allowing this court to
overturn the factual findings with which it is confronted. Speaking
specifically of criminal cases, this court stated in People of the Philippines
v. Esteban, 725 SCRA 517 (2014), that “in exceptional circumstances, such
as when the trial court overlooked material and relevant matters . . . this
Court will recalibrate and evaluate the factual findings of the [lower
courts].” Below are the recognized exceptions to the general rule binding
this court to the factual findings of lower courts: (1) When the conclusion
is a finding grounded entirely on speculation, surmises, and conjectures;
(2) When the inference made is manifestly mistaken, absurd or
impossible; (3) Where there is a grave abuse of discretion; (4) When the
judgment is based on a misapprehension of facts; (5) When the findings of
fact are conflicting; (6) When the Court of Appeals, in making its findings,
went beyond the issues of the case and the same is contrary to the
admissions of both appellant and appellee; (7) When the findings are
contrary to those of the trial court; (8) When the findings of fact are
conclusions without citation of specific evidence on which they are based;
(9) When the facts set forth in the petition as well as in the petitioners’
main and reply briefs are not disputed by the respondents; and (10) When
the findings of fact of the Court of Appeals are premised on the supposed
absence of evidence and contradicted by the evidence on record.

Same; Evidence; Witnesses; People of the Philippines v. Cleopas, 327 SCRA 552
(2000), which the Court of Appeals (CA) cited, states that the testimony of a lone

210
witness “may suffice for conviction if found trustworthy and reliable.”—People
of the Philippines v. Cleopas, 327 SCRA 552 (2000), which the Court of
Appeals cited, states that the testimony of a lone witness “may suffice for
conviction if found trustworthy and reliable.” Precisely, conviction resting
on a singular testimony is warranted if this is, in the words of Cleopas,
“trustworthy and reliable,” or, in the words of the Court of Appeals,
“credible.” This could not be said of Jao’s testimony. As previously
discussed, her very presence in the February 12, 2001 conference that she
claimed to have been immediately followed by Macayan’s threats, is in
serious doubt. Nothing casts greater doubt on the reliability of Jao’s claim
than her having not been at the time and place of the supposed
intimidation.

Same; Same; Same; For evidence to be believed, it must not only proceed from the
mouth of a credible witness but must be credible in itself such as the common
experience and observation of mankind can approve under the circumstances.—
Jurisprudence has established the standard for appreciating the credibility
of a witness’ claim: [F]or evidence to be believed, however, it must not
only proceed from the mouth of a credible witness but must be credible in
itself such as the common experience and observation of mankind can
approve under the circumstances. The test to determine the value of the
testimony of a witness is whether such is in conformity with knowledge
and consistent with the experience of mankind. Whatever is repugnant to
these standards becomes incredible and lies outside of judicial
cognizance.

FACTS:

Annie Uy Jao filed a complaint against Nilo Macayan for Robbery.

Jao is the owner of Lanero Garments Ext (Lanero). In 1995, she hired
Macayan as a sample cutter and to undertake materials purchasing for
her garments business. In 2000, when her business was doing poorly, she
allowed her employees to engage on other engagements to extend their
income; provided that the Lanero would still be their main priority. Upon
learning that Macayan and his wife is working on a rival company, she

211
confronted the latter and despite demands, Macayan took for granted his
work at Lanero. Later on, Macayan voluntarily stopped reporting to
work. He latter on filed an illegal dismissal case against Jao.

During the pendency of the illegal dismissal case, Macayan allegedly

threatened Jao that her family would be harmed and/or kidnapped if she
did not give him P200,000.00. The following day, Macayan allegedly
called Jao to reiterate his threat and to specify the time and place —
February 16, 2001, sometime between 6:00 and 7:00 p.m. at McDonald's
Banawe Branch — in which the P200,000.00 should be handed to him. Jao
claimed that she was sure it was Macayan speaking to her, as the person
on the phone addressed her as "Madam," which was how he customarily
called her. Jao sought the help of NBI for entrapment operation. The latter
asked her to prepare P4,000 to be marked and used at the operation. Upon
handling of the marked money by Macayan, the NBI immediately
proceeded the arrest.

According to Macayan’s testimony, he was boxed on the right side of

Macayan's face and told him, "Tatanga-tanga ka. Pupunta ka rito ng walang
kasama, ikaw ngayon ang me [sic] kaso."He was also physically abused by an
NBI operative.

The Information charging him with robbery dated February 20, 2001 was
then prepared, and the criminal case was filed and raffled to Branch 101
of the Regional Trial Court, Quezon City

RTC convicted him of robbery.

The Office of the Solicitor General, representing the People of the

Philippines at the appellate stage, did not file an appellee's brief. Instead,
it filed a Manifestation and Motion in Lieu of Appellee's Brief
recommending that Macayan be acquitted. It asserted that his guilt was
not established beyond reasonable doubt.

212
CA AFFIRMED Macayan's conviction and increasing the duration of the
penalty imposed. It reasoned that Jao's sole, uncorroborated testimony
was nevertheless positive and credible. Macayan filed for Motion of
Reconsideration- DENIED.

ISSUE:

Whether the guilt of Macayan was established beyond reasonable.

RULING:

Macayan is acquitted. Decision of CA is reversed.

Consistent with the rule on burden of proof, the requisite quantum of

evidence in criminal cases, and in light of the points highlighted by both
Macayan and the Office of the Solicitor General, we find that the
prosecution failed to establish Macayan's guilt beyond reasonable doubt.
Thus, a reversal of the rulings of the trial court and Court of Appeals is in
order. Macayan must be acquitted.

As correctly pointed out by the Office of the Solicitor General, the

resolution of this case hinges on whether Jao was indeed threatened
and/or intimidated by Macayan into giving him money, that is, whether
he extorted money from Jao. Per Jao's own testimony, there were two (2)
instances in which she was threatened and/or intimidated:
first, immediately after the postponement of the February 12, 2001
conference in the illegal dismissal case; and second, when Macayan called
her on February 13, 2001 and set a rendezvous for handing over the
extorted money. It was proven by the records that Jao was absent in any
of the 11 conference for illegal dismissal, it casts doubt whether Macayan
threaten her after the conference. The prosecution could have addressed
the deficiency in Jao’s allegation that she was threatened on February 12,

213
2001 by presenting as witness the other person who was supposedly
present in the incident: Angel, Jao’s secretary. However, she was never
presented as a witness. Furthermore, The prosecution itself acknowledged
that there is no basis for ascertaining the identity of Macayan as the caller
other than the caller’s use of "Madam" in addressing Jao.

Jurisprudence has established the standard for appreciating the credibility

of a witness' claim:

For evidence to be believed, however, it must not only proceed from the
mouth of a credible witness but must be credible in itself such as the common
experience and observation of mankind can approve under the circumstances.
The test to determine the value of the testimony of a witness is whether
such is in conformity with knowledge and consistent with the experience
of mankind. Whatever is repugnant to these standards becomes incredible
and lies outside of judicial cognizance.61

Jao's inconsistent conduct, coupled with flimsy justifications for acting as

she did, betrays the absurdity and unreliability of her claims and
ultimately, of her as a witness.

214
 SPOUSES BONIFACIO and LUCIA PARAS, petitioners, vs. KIMWA
CONSTRUCTION AND DEVELOPMENT CORPORATION,
respondent.

G.R. No. 171601

April 8, 2015.*

Leonen, J.

DOCTRINE:
Remedial Law; Evidence; Parol Evidence Rule; Rule 130, Section 9 of the Revised
Rules on Evidence provides for the Parol Evidence Rule, the rule on admissibility
of documentary evidence when the terms of an agreement have been reduced into
writing; Per this rule, reduction to written form, regardless of the formalities
observed, “forbids any addition to, or contradiction of, the terms of a written
agreement by testimony or other evidence purporting to show that different terms
were agreed upon by the parties, varying the purport of the written contract.”—
Rule 130, Section 9 of the Revised Rules on Evidence provides for the
Parol Evidence Rule, the rule on admissibility of documentary evidence
when the terms of an agreement have been reduced into writing: Section
9. Evidence of written agreements.—When the terms of an agreement have
been reduced to writing, it is considered as containing all the terms
agreed upon and there can be, between the parties and their successors-
in-interest, no evidence of such terms other than the contents of the
written agreement. However, a party may present evidence to modify,
explain or add to the terms of written agreement if he puts in issue in his
pleading: (a) An intrinsic ambiguity, mistake or imperfection in the
written agreement; (b) The failure of the written agreement to express the
true intent and agreement of the parties thereto; (c) The validity of the
written agreement; or (d) The existence of other terms agreed to by the
parties or their successors-in-interest after the execution of the written
agreement. The term “agreement” includes wills. Per this rule, reduction
to written form, regardless of the formalities observed, “forbids any
addition to, or contradiction of, the terms of a written agreement by

215
testimony or other evidence purporting to show that different terms were
agreed upon by the parties, varying the purport of the written contract.”

Same; Same; Same; Two (2) things must be established for parol evidence to be
admitted: first, that the existence of any of the four (4) exceptions has been put in
issue in a party’s pleading or has not been objected to by the adverse party; and
second, that the parol evidence sought to be presented serves to form the basis of
the conclusion proposed by the presenting party.—Provided that a party puts
in issue in its pleading any of the four (4) items enumerated in the second
paragraph of Rule 130, Section 9, “a party may present evidence to
modify, explain or add to the terms of the agreement[.]” Raising any of
these items as an issue in a pleading such that it falls under the exception
is not limited to the party initiating an action. In Philippine National
Railways v. Court of First Instance of Albay, 83 SCRA 569 (1978), this court
noted that “if the defendant set up the affirmative defense that the
contract mentioned in the complaint does not express the true agreement
of the parties, then parol evidence is admissible to prove the true
agreement of the parties[.]” Moreover, as with all possible objections to
the admission of evidence, a party’s failure to timely object is deemed a
waiver, and parol evidence may then be entertained. Apart from pleading
these exceptions, it is equally imperative that the parol evidence sought to
be introduced points to the conclusion proposed by the party presenting
it. That is, it must be relevant, tending to “induce belief in [the] existence”
of the flaw, true intent, or subsequent extraneous terms averred by the
party seeking to introduce parol evidence. In sum, two (2) things must be
established for parol evidence to be admitted: first, that the existence of
any of the four (4) exceptions has been put in issue in a party’s pleading
or has not been objected to by the adverse party; and second, that the parol
evidence sought to be presented serves to form the basis of the conclusion
proposed by the presenting party.

Same; Same; Our evidentiary rules impel us to proceed from the position (unless
convincingly shown otherwise) that individuals act as rational human beings,
i.e., “[t]hat a person takes ordinary care of his concerns.”—Our evidentiary
rules impel us to proceed from the position (unless convincingly shown
otherwise) that individuals act as rational human beings, i.e., “[t]hat a
person takes ordinary care of his concerns[.]” This basic evidentiary

216
stance, taken with the supporting evidence petitioners Spouses Paras
adduced, respondent Kimwa’s awareness of the conditions under which
petitioner Lucia Paras was bound, and the Agreement’s own text
specifying exclusive allotment for respondent Kimwa, supports
petitioners Spouses Paras’ position that respondent Kimwa was obliged
to haul 40,000 cubic meters of aggregates on or before May 15, 1995. As it
admittedly hauled only 10,000 cubic meters, respondent Kimwa is liable
for breach of contract in respect of the remaining 30,000 cubic meters.

FACTS:
Lucia Paras was a concessionaire of a sand and gravel permit at
Kabulihan, Toledo City. Kimwa is a construction firm that sells concrete
aggregates to contractors and haulers in Cebu. Lucia and Kimwa entered
into a contract denominated "Agreement for Supply of Aggregates" where
40,000 cubic meters of aggregates were allotted by Lucia as supplier to
Kimwa. Kimwa was to pick up the allotted aggregates at Lucia's
permitted area in Toledo City at P240.00 per truckload. Pursuant to the
Agreement, Kimwa hauled 10,000 cubic meters of aggregates. However,
after this Kimwa stopped hauling aggregates and allegedly transferred to
the concession area of a certain Mrs. Remedios dela Torre in violation of
their Agreement.

Spouses Paras sent demand letters to Kimwa. As these went

unheeded, Spouses Paras filed a complaint for breach of contract with
damages against Kimwa. In its Answer, Kimwa alleged that it never
committed to obtain 40,000 cubic meters of aggregates. It argued that the
40,000 cubic meters represented is only the maximum quantity that it
could haul. Kimwa asserted that the May 15, 1995 which was the
expiration of the Special Permit of Lucia was never set as a deadline.
Invoking the Parol Evidence Rule, it insisted that Spouses Paras were
barred from introducing evidence which would show that the parties had
agreed differently.

217
 The RTC rendered the Decision in favor of Spouses Paras. On
appeal, CA reversed the RTC's Decision.

ISSUES:
Whether or not the RTC erred for basing its findings on the basis
of evidence presented in violation of the parol evidence rule.
Whether or not Kimwa is liable to petitioners Spouses Paras for
Breach of Contract.

RULING:
(1) No. Rule 130, Section 9 of the Revised Rules on Evidence
provides that "When the terms of an agreement have been reduced to
writing, it is considered as containing all the terms agreed upon and there
can be, between the parties and their successors in interest, no evidence of
such terms other than the contents of the written agreement.

However, a party may present evidence to modify, explain or add

to the terms of written agreement if he puts in issue in his pleading: (a)
An intrinsic ambiguity, mistake or imperfection in the written agreement;
(b) The failure of the written agreement to express the true intent and
agreement of the parties thereto; (c) The validity of the written agreement;
(d) The existence of other terms agreed to by the parties or their
successors in interest after the execution of the written agree.

There are 2 things must be established for parol evidence to be

admitted: first, that the existence of any of the 4 exceptions has been put
in issue in a party's pleading or has not been objected to by the adverse
party; and second, that the parol evidence sought to be presented serves
to form the basis of the conclusion proposed by the presenting party.

218
 In the present case petitioners pleaded in the Complaint they filed
before the trial court a mistake or imperfection in the Agreement, as well
as the Agreement's failure to express the true intent of the parties.
Further, respondent Kimwa, through its Answer, also responded to
petitioners Spouses Paras' pleading of these issues. This is , thus, an
exceptional case allowing admission of parol evidence.

Proof of how petitioners Spouses Paras successfully pleaded and

put this in issue in their Complaint is how respondent Kimwa felt it
necessary to respond to it or address it in its Answer. Thus, the
testimonial and documentary parol evidence sought to be introduced by
petitioners Spouses Paras, which attest to these supposed flaws and what
they aver to have been the parties' true intent, may be admitted and
considered.

(2) Yes. Petitioners have established that respondent Kimwa was

obliged to haul 40,000 cubic meters of aggregates on or before May 15,
1995. Considering its admission that it did not haul 30,000 cubic meters of
aggregates, respondent Kimwa is liable to petitioners.

Having been admittedly furnished a copy of this Special Permit,

respondent Kimwa was well aware that a total of only about 40,000 cubic
meters of aggregates may be extracted by petitioner Lucia from the
permitted area, and that petitioner Lucia Paras' operations cannot extend
beyond May 15, 1995, when the Special Permit expires.

The condition that the Special Permit shall be valid for only six (6)
months from November 14, 1994 lends credence to petitioners Spouses
Paras' assertion that, in entering into the Agreement with respondent
Kimwa, petitioner Lucia Paras did so because of respondent Kimwa's
promise that hauling can be completed by May 15, 1995. Bound as she
was by the Special Permit, petitioner Lucia Paras needed to make it
eminently clear to any party she was transacting with that she could
supply aggregates only up to May 15, 1995 and that the other party's
hauling must be completed by May 15, 1995. She was merely acting with
due diligence, for otherwise, any contract she would enter into would be
negated; any commitment she would make beyond May 15, 1995 would

219
make her guilty of misrepresentation, and any prospective income for her
would be rendered illusory.

220
 IN THE MATTER OF THE PETITION FOR HABEAS CORPUS OF
DATUKAN MALANG SALIBO,
DATUKAN MALANG SALIBO, petitioner, vs. WARDEN, QUEZON
CITY JAIL ANNEX, BJMP BUILDING, CAMP BAGONG DIWA,
TAGUIG CITY and all other persons acting on his behalf and/or having
custody of DATUKAN MALANG SALIBO, respondents.

G.R. No. 197597

April 8, 2015.*

Leonen, J.

DOCTRINE:
Remedial Law; Special Proceedings; Habeas Corpus; An application for a writ of
habeas corpus may be made through a petition filed before this court or any of its
members, the Court of Appeals (CA) or any of its members in instances
authorized by law, or the Regional Trial Court (RTC) or any of its presiding
judges.—An application for a writ of habeas corpus may be made through a
petition filed before this court or any of its members, the Court of Appeals
or any of its members in instances authorized by law, or the Regional
Trial Court or any of its presiding judges. The court or judge grants the
writ and requires the officer or person having custody of the person
allegedly restrained of liberty to file a return of the writ. A hearing on the
return of the writ is then conducted. The return of the writ may be heard
by a court apart from that which issued the writ. Should the court issuing
the writ designate a lower court to which the writ is made returnable, the
lower court shall proceed to decide the petition of habeas corpus. By virtue
of the designation, the lower court “acquire[s] the power and authority to
determine the merits of the [petition for habeas corpus.]” Therefore, the
decision on the petition is a decision appealable to the court that has
appellate jurisdiction over decisions of the lower court.

Same; Same; Same; Under Rule 102, Section 1 of the Rules of Court, the writ of
habeas corpus “shall extend to all cases of illegal confinement or detention by
which any person is deprived of his liberty, or by which the rightful custody of

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any person is withheld from the person entitled thereto.”—Called the “great writ
of liberty[,]” the writ of habeas corpus “was devised and exists as a speedy and
effectual remedy to relieve persons from unlawful restraint, and as the best and
only sufficient defense of personal freedom.” The remedy of habeas corpus is
extraordinary and summary in nature, consistent with the law’s “zealous regard
for personal liberty.” Under Rule 102, Section 1 of the Rules of Court, the writ
of habeas corpus “shall extend to all cases of illegal confinement or detention by
which any person is deprived of his liberty, or by which the rightful custody of
any person is withheld from the person entitled thereto.” The primary purpose of
the writ “is to inquire into all manner of involuntary restraint as distinguished
from voluntary, and to relieve a person therefrom if such restraint is illegal.”
“Any restraint which will preclude freedom of action is sufficient.”

Same; Same; Same; The nature of the restraint of liberty need not be related to
any offense so as to entitle a person to the efficient remedy of habeas corpus.—
The nature of the restraint of liberty need not be related to any offense so
as to entitle a person to the efficient remedy of habeas corpus. It may be
availed of as a post-conviction remedy or when there is an alleged
violation of the liberty of abode. In other words, habeas corpus effectively
substantiates the implied autonomy of citizens constitutionally protected
in the right to liberty in Article III, Section 1 of the Constitution. Habeas
corpus being a remedy for a constitutional right, courts must apply a
conscientious and deliberate level of scrutiny so that the substantive right
to liberty will not be further curtailed in the labyrinth of other processes.

Same; Same; Same; The writ of habeas corpus is different from the final decision
on the petition for the issuance of the writ.—This court cited Mayor Justo
Lukban in contempt of court for failure to make a Return of the Writ. As
to the legality of his acts, this court ruled that Mayor Justo Lukban
illegally deprived the women he had deported to Davao of their liberty,
specifically, of their privilege of domicile. It said that the women, “despite
their being in a sense lepers of society[,] are nevertheless not chattels but
Philippine citizens protected by the same constitutional guaranties as are
other citizens[.]” The women had the right “to change their domicile from
Manila to another locality.” The writ of habeas corpus is different from the
final decision on the petition for the issuance of the writ. It is the writ that
commands the production of the body of the person allegedly restrained

222
of his or her liberty. On the other hand, it is in the final decision where a
court determines the legality of the restraint. Between the issuance of the
writ and the final decision on the petition for its issuance, it is the issuance
of the writ that is essential. The issuance of the writ sets in motion the
speedy judicial inquiry on the legality of any deprivation of liberty.
Courts shall liberally issue writs of habeas corpus even if the petition for its
issuance “on [its] face [is] devoid of merit[.]” Although the privilege of
the writ of habeas corpus may be suspended in cases of invasion, rebellion,
or when the public safety requires it, the writ itself may not be suspended.

Same; Same; Same; It is true that a writ of habeas corpus may no longer be issued
if the person allegedly deprived of liberty is restrained under a lawful process or
order of the court.—It is true that a writ of habeas corpus may no longer be
issued if the person allegedly deprived of liberty is restrained under a
lawful process or order of the court. The restraint then has become legal,
and the remedy of habeas corpus is rendered moot and academic. Rule 102,
Section 4 of the Rules of Court provides: SEC. 4. When writ not allowed or
discharge authorized.—If it appears that the person alleged to be restrained
of his liberty is in the custody of an officer under process issued by a court
or judge or by virtue of a judgment or order of a court of record, and that
the court or judge had jurisdiction to issue the process, render the
judgment, or make the order, the writ shall not be allowed; or if the
jurisdiction appears after the writ is allowed, the person shall not be
discharged by reason of any informality or defect in the process,
judgment, or order. Nor shall anything in this rule be held to authorize
the discharge of a person charged with or convicted of an offense in the
Philippines, or of a person suffering imprisonment under lawful
judgment.

Same; Same; Same; Moot and Academic; The filing of the Informations,
according to the Supreme Court (SC), rendered the Petitions for habeas corpus
moot and academic.—This court likewise dismissed the Petitions for habeas
corpus in Umil v. Ramos, 187 SCRA 311 (1990). Roberto Umil, Rolando
Dural, Renato Villanueva, Amelia Roque, Wilfredo Buenaobra, Atty.
Domingo Anonuevo, Ramon Casiple, Vicky A. Ocaya, Deogracias Espiritu,
and Narciso B. Nazareno were all arrested without a warrant for their alleged
membership in the Communist Party of the Philippines/New People’s Army.

223
During the pendency of the habeas corpus proceedings, however, Informations
against them were filed before this court. The filing of the Informations, according
to this court, rendered the Petitions for habeas corpus moot and academic, thus: It
is to be noted that, in all the petitions here considered, criminal charges have been
filed in the proper courts against the petitioners. The rule is, that if a person
alleged to be restrained of his liberty is in the custody of an officer under process
issued by a court or judge, and that the court or judge had jurisdiction to issue
the process or make the order, or if such person is charged before any court, the
writ of habeas corpus will not be allowed.

Same; Same; Same; Instead of availing themselves of the extraordinary remedy of

a petition for habeas corpus, persons restrained under a lawful process or order of
the court must pursue the orderly course of trial and exhaust the usual
remedies.—Instead of availing themselves of the extraordinary remedy of a
petition for habeas corpus, persons restrained under a lawful process or
order of the court must pursue the orderly course of trial and exhaust the
usual remedies. This ordinary remedy is to file a motion to quash the
information or the warrant of arrest.

Same; Criminal Procedure; Motion to Quash; At any time before a plea is

entered, the accused may file a motion to quash complaint or information based
on any of the grounds enumerated in Rule 117, Section 3 of the Rules of Court.—
At any time before a plea is entered, the accused may file a motion to
quash complaint or information based on any of the grounds enumerated
in Rule 117, Section 3 of the Rules of Court: SEC. 3. Grounds.—The
accused may move to quash the complaint or information on any of the
following grounds: (a) That the facts charged do not constitute an offense;
(b) That the court trying the case has no jurisdiction over the offense
charged; (c) That the court trying the case has no jurisdiction over the
person of the accused; (d) That the officer who filed the information had
no authority to do so; (e) That it does not conform substantially to the
prescribed form; (f) That more than one offense is charged except when a
single punishment for various offenses is prescribed by law; (g) That the
criminal action or liability has been extinguished; (h) That it contains
averments which, if true, would constitute a legal excuse or justification;
and (i) That the accused has been previously convicted or acquitted of the

224
offense charged, or the case against him was dismissed or otherwise
terminated without his express consent.

Same; Same; Same; If the accused avails himself or herself of a motion to quash,
the accused “hypothetically admits the facts alleged in the information.”—In
filing a motion to quash, the accused “assails the validity of a criminal
complaint or information filed against him [or her] for insufficiency on its
face in point of law, or for defects which are apparent in the face of the
information.” If the accused avails himself or herself of a motion to quash,
the accused “hypothetical[ly] admits the facts alleged in the information.”
“Evidence aliunde or matters extrinsic from the information are not to be
considered.”

Same; Same; Same; If the motion to quash is based on an alleged defect of the
complaint or information which can be cured by amendment, the court shall order
the amendment of the complaint or information. If the motion to quash is based
on the ground that the facts alleged in the complaint or information do not
constitute an offense, the trial court shall give the prosecution an opportunity to
correct the defect by amendment.—“If the motion to quash is based on an
alleged defect of the complaint or information which can be cured by
amendment, the court shall order [the] amendment [of the complaint or
information].” If the motion to quash is based on the ground that the facts
alleged in the complaint or information do not constitute an offense, the
trial court shall give the prosecution “an opportunity to correct the defect
by amendment.” If after amendment, the complaint or information still
suffers from the same defect, the trial court shall quash the complaint or
information.

FACTS:

Butukan S. Malang, one of the accused in the Maguindanao

massacre, had a pending warrant of arrest issued by the trial court in
People vs Ampatuan Jr. et. al. When Datukan Malang Salibo learned that
the police officers of Datu Hofer Police Station in Maguindanao suspected
him to be Butukan S. Malang, he presented himself to clear his name.
Salibo presented to the police pertinent portions of his passport, boarding

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passes and other documents tending to prove that a certain Datukan
Malang Salibo was in Saudi Arabia when the massacre happened. The
authorities, however, apprehended and detained him. He questioned the
legality of his detention via Urgent Petition for Habeas Corpus before the
CA, maintaining that he is not the accused Batukan S. Malang. The CA
issued the writ, making it returnable to the judge of RTC Taguig. After
hearing of the Return, the trial court granted Salibo’s petition and ordered
his immediate release from detention.

On appeal by the Warden, the CA reversed the RTC ruling. The CA held
that even assuming Salibo was not the Batukan S. Malang named in the
Alias Warrant of Arrest, orderly course of trial must be pursued and the
usual remedies exhausted before the writ of habeas corpus may be
invoked. Salibo’s proper remedy, according to the CA, should have been
a motion to quash information and/or warrant of arrest.

On the other hand, Salibo believes that the Warden erred in appealing the
RTC decision before the CA. Salibo argued that although the CA
delegated to the RTC the authority to hear the Warden’s Return, the
RTC’s ruling should be deemed as the CA ruling, and hence, it should
have been appealed directly before the SC.

ISSUE 1:

WON Salibo properly availed the remedy of a petition for writ of habeas
corpus

Yes. Habeas corpus is the remedy for a person deprived of liberty due to
mistaken identity. In such cases, the person is not under any lawful
process and is continuously being illegally detained.

First, it was Butukan S. Malang, not Salibo, who was charged and accused
in the Information and Alias Warrant of Arrest issued in the case of
People vs Ampatuan. Based on the evidences presented, Salibo

226
sufficiently established that he could not have been Butukan S. Malang.
Therefore, Salibo was not arrested by virtue of any warrant charging him
of an offense, nor restrained under a lawful process or an order of a court.
Second, Salibo was not validly arrested without a warrant. When he was
in the presence of authorities, he was neither committing nor attempting
to commit an offense, and the police officers had no personal knowledge
of any offense that he might have committed. Salibo was also not an
escape prisoner.

The police officers have deprived him of his liberty without due process
of law. Therefore, Salibo correctly availed himself of a Petition for Habeas
Corpus.

ISSUE 2:

WON a motion to quash information and/or warrant of arrest is the

proper remedy in cases where a person with a mistaken identity is
detained

No, the CA’s contention is not correct. Salibo’s proper remedy is not a
Motion to Quash Information and/or Warrant of Arrest. None of the
grounds for filing a Motion to Quash Information apply to him. Even if
petitioner Salibo filed a Motion to Quash, the defect he alleged could not
have been cured by mere amendment of the Information and/or Warrant
of Arrest. Changing the name of the accused appearing in the
Information and/or Warrant of Arrest from “Butukan S. Malang” to
“Datukan Malang Salibo” will not cure the lack of preliminary
investigation in this case. Likewise, a motion for reinvestigation will not
cure the defect of lack of preliminary investigation.

ISSUE 3:

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WON the Warden correctly appealed the RTC ruling on the Return before
the CA

Yes. An application for a writ of habeas corpus may be made through a

petition filed before CA or any of its members, the CA or any of its
members in instances authorized by law, or the RTC or any of its
presiding judges. The court or judge grants the writ and requires the
officer or person having custody of the person allegedly restrained of
liberty to file a return of the writ. A hearing on the return of the writ is
then conducted.

The return of the writ may be heard by a court apart from that which
issued the writ. Should the court issuing the writ designate a lower court
to which the writ is made returnable, the lower court shall proceed to
decide the petition of habeas corpus. By virtue of the designation, the
lower court acquires the power and authority to determine the merits of
the petition for habeas corpus. Therefore, the decision on the petition is a
decision appealable to the court that has appellate jurisdiction over
decisions of the lower court.

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 G.R. No. 158836, September 30, 2015

SUNRISE GARDEN CORPORATION, Petitioner, v. COURT OF

APPEALS AND FIRST ALLIANCE REAL ESTATE DEVELOPMENT,
INC., Respondents.

G.R. No. 158967

REPUBLIC OF THE PHILIPPINES, REPRESENTED BY ANTIPOLO

CITY, Petitioner, v. COURT OF APPEALS AND FIRST ALLIANCE
REAL ESTATE DEVELOPMENT, INC., Respondents.

G.R. No. 160726

REPUBLIC OF THE PHILIPPINES, REPRESENTED BY ANTIPOLO

CITY, Petitioner, v. FIRST ALLIANCE REAL ESTATE
DEVELOPMENT, INC., Respondents.

G.R. No. 160778

SUNRISE GARDEN CORPORATION, Petitioner, v. FIRST ALLIANCE

REAL ESTATE DEVELOPMENT, INC., Respondent.

LEONEN, J.

DOCTRINE:
A person who is not a party in the main action cannot be the subject of the
ancillary writ of preliminary injunction.

Preliminarily, jurisdiction over the defendant in a civil case is acquired either by

the coercive power of legal processes exerted over his person, or his voluntary
appearance in court. As a general proposition, one who seeks an affirmative relief
is deemed to have submitted to the jurisdiction of the court. This, however, is
tempered by the concept of conditional appearance, such that a party who makes a

229
 special appearance to challenge, among others, the court's jurisdiction over his
person cannot be considered to have submitted to its authority.

FACTS:
In 1999, the Sangguniang Barangay of Cupang requested the
Sangguniang Panlungsod of Antipolo City to construct a city road to
connect Barangay Cupang and Marcos Highway.3 The request was
approved through the enactment of Resolusyon Big. 027-99.4 In view of
the same The Technical Committee created by City Ordinance No. 08-98
posted notices to property owners that would be affected by the
construction of the city road.5 The notices stated:
NOTICE TO THE PUBLIC
PURSUANT TO CITY ORDINANCE NO. 08-98 xxxxxx THE OF
ANTIPOLO IS GOING TO CONSTRUCT THE 20.00 METERS WIDE
CITY GENERAL PUBLIC IS HEREBY NOTIFIED THAT THE CITY
GOVERNMENT xxxxxx
ALL PROPERTY OWNERS AFFECTED ARE ENJOINED TO SEE THE
PLANNING OFFICER OF ANTIPOLO CITY FOR DETAILS OF THE
PROGRAM.
Sunrise Garden Corporation was an affected landowner Sunrise Garden
Corporation, through Cesar T. Guy executed an Undertaking11 That I am
willing to undertake and finance development of the City Park and City
Road connecting Marcos Highway to Marikina - San Mateo - Antipolo
National Highway which cost shall be applied to our [t]axes and other
fees payable to the City Government;. That I am willing to sign and
execute all legal instrument necessary to transfer ownership of the same
to the City government[.
Sunrise Garden Corporation's contractor15 began to position its
construction equipment.16 However, armed guards,17 allegedly hired by
Hardrock Aggregates, Inc., prevented Sunrise Garden Corporation's
contractor from using an access road to move the construction
equipment.18 , Sunrise Garden Corporation filed a Complaint19 for
damages with prayer for temporary restraining order and writ of
preliminary injunction against Hardrock Aggregates, Inc.20 Hardrock
Aggregates, Inc. filed its Answer to the Complaint.21 The trial court issued

230
a temporary restraining order on February 15, 2002, "directing Hardrock
to cease and desist from preventing/blocking the contractor in moving its
equipments to the site of the proposed city road however the latter
continued with their acts. the trial court ordered the issuance of a Writ of
Preliminary Injunction, subject to the posting of a bond by Sunrise
Garden Corporation.24 Writ of Preliminary Injunction was issued.
While the Complaint was pending, informal settlers started to encroach
on the area of the proposed city road.26 , filed a Motion and Manifestation
to amend the Preliminary injunction to include and all –person or group
in preventing or obstructing all of petitioner's etc. which was granted by
the RTC. Although the informal settlers complied with the order armed
guards of K-9 Security Agency, allegedly hired by First Alliance Real
Estate Development, Inc.,33 blocked Sunrise Garden Corporation's
contractor's employees and prevented them from proceeding with the
construction.34
A Motion to cite K-9 Security Agency in contempt was filed on October
11, 200241 by Sunrise Garden Corporation.42 , K-9 Security Agency, joined
by First Alliance Real Estate Development, Inc. and represented by the
same counsel,43 opposed the Motion to cite them in contempt, raising the
defense of lack of jurisdiction over their persons, since they were not
bound by the Amended Writ of Preliminary Injunction.44

The trial court granted Sunrise Garden Corporation's Motion and issued
an Order dated November 22, 2002 requiring K-9 Security Agency to
comply with the Amended Writ of Preliminary Injunction
K-9 Security Agency and First Alliance Real Estate Development, Inc.
filed a Motion for Reconsideration76reiterating their arguments that since
the trial court did not acquire jurisdiction over them, the Writ of
Preliminary Injunction could not be enforced against them.77 – the same
was denied by the RTC.
First Alliance Real Estate Development, Inc. thus filed a Petition
for Certiorari with prayer for preliminary injunction and temporary
restraining order before the Court of Appeals.
Court of Appeals, on November 5, 2003, granted First Alliance Real Estate
Development, Inc.'s Petition for Certiorari and annulled the Amended

231
Writ of Preliminary Injunction issued by the trial court,99 reasoning as:
Indeed, public respondent court acted with grave abuse of discretion and
without jurisdiction when it sought the enforcement of its amended writ
of preliminary injunction against petitioner, who was never a party to the
pending case. Worse, it threatened petitioner with contempt of court for
not following an unlawful order.
Sunrise Garden Corporation argue that the Court of Appeals committed
grave abuse of discretion in not dismissing the Petition outright due to
insufficiency of form and substance.112 Sunrise Garden Corporation
argues that First Alliance Real Estate Development, Inc. failed to prove its
ownership over the properties in dispute.113 Thus, it did not establish any
right that would entitle it to the reliefs prayed for.

ISSUE:
WON the RTC acquired jurisdiction over K9 and First Alliance Real Estate
Development, Inc.

RULING:
No. In Philippine Commercial International Bank v. Spouses Dy Hong Pi, et al.,
this court discussed that voluntary appearance in court may not always
result in submission to the jurisdiction of a court.
Preliminarily, jurisdiction over the defendant in a civil case is acquired
either by the coercive power of legal processes exerted over his person, or
his voluntary appearance in court. As a general proposition, one who
seeks an affirmative relief is deemed to have submitted to the jurisdiction
of the court. This, however, is tempered by the concept of conditional
appearance, such that a party who makes a special appearance to
challenge, among others, the court's jurisdiction over his person cannot be
considered to have submitted to its authority.
The appearance of respondent First Alliance Real Estate Development,
Inc. and K-9 Security Agency should not be deemed as a voluntary
appearance because it was for the purpose of questioning the jurisdiction
of the trial court. The records of this case show that the defense of lack of
jurisdiction was raised at the first instance and repeatedly argued by K-9

232
Security Agency and respondent First Alliance Real Estate Development,
Inc. in their pleadings.
Considering that the trial court gravely abused its discretion when it
sought to enforce the Amended Writ of Preliminary Injunction against
respondent First Alliance Real Estate Development, Inc., the Court of
Appeals did not err in granting the Petition for Certiorari filed by
respondent First Alliance Real Estate Development, Inc.

233
ALEJANDRO CEPRADO, JR., RONILO SEBIAL, NICANOR OLIVAR,
ALVIN VILLEGAS, and EDGAR MANATO,
petitioners, vs. NATIONWIDE SECURITY AND ALLIED SERVICES,
INC./ROMEO T. NOLASCO, respondents.

G.R. No. 175198

September 23, 2015.*

Leonen, J.

DOCTRINE:

Remedial Law; Civil Procedure; Labor Standards; Motions for Reconsideration;

The Rules of Court, which applies suppletorily in labor standards cases, requires
a written notice of every motion for reconsideration to be served on the adverse
party as compliance with the requirement of due process. Motions for
reconsideration not served on the other party are pro forma and are “mere
scrap[s] of paper” not to be acted upon by the court.—The Rules of Court,
which applies suppletorily in labor standards cases, requires a written
notice of every motion for reconsideration to be served on the adverse
party as compliance with the requirement of due process. Motions for
reconsideration not served on the other party are pro forma and are “mere
scrap[s] of paper” not to be acted upon by the court. Motions for reconsideration
not served on the other party do not toll the running of the reglementary period
for filing an appeal, and the judgment sought to be reconsidered becomes final
and executory upon lapse of the reglementary period.

Same; Same; Jurisdiction; If an appellate court or tribunal takes cognizance of an

appeal that does not comply with the rules, the appellate court or tribunal acts
without jurisdiction.—Appeal is a purely statutory privilege that “may be
exercised only in the manner and in accordance with the provisions of
law.” If an appellate court or tribunal takes cognizance of an appeal that
does not comply with the rules, the appellate court or tribunal acts
without jurisdiction. The decision on the appeal is null and void.

234
FACTS:
Nationwide Security and Allied Services, Inc. (Nationwide Security)
is a security agency with Romeo T. Nolasco as its president and general
manager. It provided security guard services to Uniden Philippines
(Uniden), whose plant is located in Cabuyao, Laguna.

On November 16, 2000, the Office of the Regional Director of the

Department of Labor and Employment - Region IV (Regional Office)
conducted a regular inspection of Uniden's Cabuyao plant pursuant to the
visitorial and enforcement powers under Article 128(b) of the Labor Code.
In the Notice of Inspection Results, the following violations of labor
standards laws allegedly committed against the security personnel
stationed at Uniden were noted:
Record keeping - employment records such as payrolls and daily
time records of guards were kept and maintained at their main office;

Underpayment of wages and salary[-]related benefits;

No [Department of Labor and Employment] registration per

[Department Order] No. 10;

No organized safety committee/no safety committee reports;

No annual medical report;

235
 No annual work accident/illness exposure data report; and

Non-submission of list of labor component.

Finding that Nationwide Security and Uniden failed to rectify the alleged
violations "despite the ample time given to both respondents,” Regional
Director Ricardo S. Martinez, Sr. (Regional Director Martinez) declared
the labor inspector's findings "final and conclusive” in the Order dated
April 19, 2001. He directed Nationwide Security and Uniden to solidarity
pay 40 security personnel the aggregate amount of P1,600,134.40
representing wage differentials and other salary-related benefits, with
each security personnel receiving P40,003.36. Failure to pay the required
amount within 10 calendar days, according to the Regional Director,
would result in Nationwide Security and/or Uniden paying double
indemnity pursuant to Republic Act No. 8188.

Nationwide Security filed a Motion for Reconsideration, arguing that its

liability with Uniden is merely joint and not solidary, Uniden being the
principal client.

Regional Director Martinez heard Nationwide Security's Motion for

Reconsideration and directed the company to submit payrolls and daily
time records covering the period from November 17, 1998 to November
16, 2000. Nationwide Security subsequently filed a Manifestation,
contending for the first time that the Regional Office had no jurisdiction
over the case. Citing Article 129 of the Labor Code, which limited the
jurisdiction of the Regional Director over money claims amounting to
P5,000.00 or less, Nationwide Security argued that the Regional Director
had no authority to order the payment of P1,600,134.40. Nationwide

236
Security also alleged that some of the security personnel had already
received the wage differentials as evidenced by quitclaims.

In the meantime, five (5) of the security personnel—namely: Alejandro

Ceprado, Jr., Ronilo Sebial, Nicanor Olivar, Alvin Villegas, and Edgar
Manato—filed before the National Labor Relations Commission Regional
Arbitration Branch No. IV a Complaint for illegal dismissal. They alleged
that Nationwide Security terminated their employment when they
"persisted in seeking enforcement of the awards under the April 19, 2001
[O]rder."

Acting on the Motion for Reconsideration previously filed by Nationwide

Security, Regional Director Martinez reversed his April 19, 2001 Order in
the Resolution dated May 8, 2002. He ruled that the jurisdictional amount
in Article 129 of the Labor Code had already been repealed by Republic
Act No. 7730. With respect to the alleged violations of Nationwide
Security, Regional Director Martinez found that they had already been
rectified. The wage differentials due to the security personnel were
likewise recomputed. Specifically for Ceprado, Jr. et al., Regional Director
Martinez ruled that they were collectively entitled to P46,218.10
representing the wage differentials and other benefits due them.

Ceprado, Jr. et al. then wrote the Secretary of Labor and Employment,
praying that the Resolution dated May 8, 2002 be set aside. They alleged
that upon verification of case records, Nationwide Security and Uniden
neither appealed nor filed a motion for reconsideration of the April 19,
2001 Order. Thus, the April 19, 2001 Order already became final and
executory and may no longer be disturbed.

237
Former Secretary of Labor and Employment Patricia A. Sto. Tomas
(Secretary Sto. Tomas) received a copy of Ceprado, Jr. et al.'s Letter on
May 30, 2002. She treated the Letter as an appeal and, in the Order dated
March 12, 2003, set aside Regional Director Martinez's Resolution dated
May 8, 2002. According to Secretary Sto. Tomas, Ceprado, Jr. et al. were
not notified of the proceedings subsequent to the issuance of the April 19,
2001 Order. Thus, they were deprived of their right to due process,
rendering the Resolution dated May 8, 2002 null and void.

With no motion for reconsideration having been filed by Nationwide or

Uniden, the Order dated March 12, 2003 was deemed final and executory
on April 28, 2003. An Entry of Judgment was, thus, issued by the
Department of Labor and Employment.

Accordingly, the Regional Office issued a Writ of Execution. to

implement the Order dated March 12, 2003. The aggregate amount
payable to Ceprado, Jr. et al. was recomputed to P400,033.60, inclusive of
the penalties provided under Republic Act No. 8188.

A Motion to Quash and Recall Writ of Execution was filed by Nationwide

Security. It argued that the Order dated March 12, 2003 was null and void,
having been rendered without proof of service on the company of
Ceprado, Jr. et al.'s Letter-Appeal to Secretary Sto. Tomas. It added that it
already paid Ceprado, Jr. et al. P46,218.10 as required in the April 19, 2001
Order. Therefore, there was nothing left to execute.

Still, in the Order dated March 23, 2004, Secretary Sto. Tomas denied the
Motion to Quash and Recall Writ of Execution, ruling that there was no
denial of due process. According to the Secretary, the findings in the

238
Notice of Inspection Results have long become final and executory.
Consequently, the issuance of a Writ of Execution was in order.

Nationwide Security filed a Motion for Reconsideration, which former

Acting Secretary of Labor and Employment Manuel G. Imson denied in
the Order dated July 19, 2004.

Alleging grave abuse of discretion on the part of the Department of Labor

and Employment, Nationwide Security filed a Petition for
Certiorari before the Court of Appeals. It argued that Secretary Sto.
Tomas' Order dated March 12, 2003, which treated Ceprado, Jr. et al.'s
Letter dated May 27, 2002 as an appeal and subsequently granted it, was
null and void for lack of due process. Nationwide Security was allegedly
not furnished a copy of the Letter-Appeal. Thus, it was deprived of the
opportunity to file a reply or opposition as provided under Rule IV,
Section 4(b) of the Rules on the Disposition of Labor Standards Cases in
the Regional Offices.

Worse, Nationwide Security already paid the judgment amount of

P46,218.10 as ordered in the Resolution dated May 8, 2002. The payment
was evidenced by Official Receipt No. 2396419 issued by the Regional
Office as proof of compliance with the Resolution. It was, therefore, grave
abuse of discretion for the Regional Office to issue a Writ of Execution to
implement the Order dated March 12, 2003.
The Court of Appeals granted Nationwide Security's Petition for
Certiorari upon finding that Nationwide Security filed its Motion for
Reconsideration before Regional Director Martinez without furnishing
Ceprado, et al. a copy of the Motion. It likewise found that Ceprado, et al.
filed their Letter-Appeal before the Department of Labor and

239
Employment without furnishing Nationwide Security a copy of the
Letter-Appeal.

Consequently, the Court of Appeals voided for lack of due process both
the Regional Director's Resolution dated May 8, 2002 granting
Nationwide Security's Motion for Reconsideration and the Department of
Labor and Employment's Order dated March 12, 2003 granting Ceprado,
et al.'s appeal. The Court of Appeals likewise voided the Department of
Labor and Employment's Order dated March 23, 2004 denying the Motion
to Quash and Recall Writ of Execution, as well as the Order dated July 19,
2004 denying Nationwide Security's Motion for Reconsideration.

In the Decision dated September 12, 2006, the Court of Appeals set aside
the Resolution dated May 8, 2002, the Order dated March 12, 2003, the
Order dated March 23, 2004, and the Order dated July 19, 2004. It
remanded the case to the Regional Director "for action on the motion for
reconsideration and/or appeal filed by [Nationwide Security], with prior
notice to and opportunity to be heard on the part of [Ceprado, et al.],
subject to further proceedings as the rules and the circumstances may
warrant."

Ceprado, et al. filed a Motion for Reconsideration, which the Court of

Appeals denied in the Resolution dated October 30, 2006.

Assailing the Court of Appeals' Decision and Resolution, Ceprado, et al.

filed before this court their Petition for Review on Certiorari. Nationwide
Security filed its Comment, after which Ceprado, et al. filed their Reply.

ISSUE:
WON the written notice of the Motion for Reconsideration served to the
adverse party is an essential requirement for compliance to due process.

240
HELD:
YES. The Rules of Court, which applies suppletorily in labor standards
cases, requires a written notice of every motion for reconsideration to be
served on the adverse party as compliance with the requirement of due
process. Motions for reconsideration not served on the other party are pro
forma and are “mere scrap[s] of paper” not to be acted upon by the court.
Motions for reconsideration not served on the other party do not toll the
running of the reglementary period for filing an appeal, and the judgment
sought to be reconsidered becomes final and executory upon lapse of the
reglementary period.

241
ELISEO MALTOS and ROSITA P. MALTOS, petitioners, vs. HEIRS OF
EUSEBIO BORROMEO, respondents.

G.R. No. 172720

September 14, 2015.*

Leonen, J.

DOCTRINE:
Remedial Law; Civil Procedure; Counterclaims; The general rule is that “a
compulsory counterclaim . . . not set up shall be barred.”—The general rule is
that “[a] compulsory counterclaim . . . not set up shall be barred.” Further,
the computation of the value of the improvements on the land entails
findings of fact. In any case, the Court of Appeals did not err when it
stated in its Resolution dated April 7, 2006 that: With respect to
Appellees’ claim for the reimbursement of the improvements on the land
in question, they are hereby declared to have lost and forfeited the value
of the necessary improvements that they made thereon in the same
manner that Appellants should lose the value of the products gathered by
the Appellees from the said land.

Same; Same; Reversion; The purpose of reversion is “to restore public land
fraudulently awarded and disposed of to private individuals or corporations to the
mass of public domain.”—The purpose of reversion is “to restore public
land fraudulently awarded and disposed of to private individuals or
corporations to the mass of public domain.” The general rule is that
reversion of lands to the state is not automatic, and the Office of the
Solicitor General is the proper party to file an action for reversion.

Same; Same; Same; Since an action for reversion presupposes that the property in
dispute is owned by the state, it is proper that the action be filed by the Office of
the Solicitor General (OSG), being the real party-in-interest.—We clarify that
the remedy of reversion is not the same as the remedy of declaration of
nullity of free patents and certificate of title. In reversion, the “allegations
in the complaint would admit State ownership of the disputed land[,]”
while in an action for the declaration of nullity of free patent and

242
certificate of title, the allegations would include “plaintiff’s ownership of
the contested lot prior to the issuance of [the] free patent and certificate of
title[.]” Since an action for reversion presupposes that the property in
dispute is owned by the state, it is proper that the action be filed by the
Office of the Solicitor General, being the real party-in-interest.

FACTS:
On February 13, 1979, Eusebio Borromeo (Borromeo) was issued
Free Patent over a piece of agricultural land located in San Francisco,
Agusan del Sur. On June 15, 1983, well within the five-year prohibitory
period, Borromeo sold the land to Eliseo Maltos (Maltos). Borromeo died
on January 16, 1991. His heirs claimed that prior to his death, he allegedly
told his wife, Norberta and his children to nullify the sale made to Maltos
because the sale was within the five-year prohibitory period. On June 23,
1993, Norberta and her children (heirs of Borromeo) filed a Complaint for
Nullity of Title and Reconveyance of Title against Maltos.

Eliseo Maltos and Rosita Maltos (Maltos Spouses) filed their Answer,
arguing that the sale was made in good faith and that in purchasing the
property, they relied on Eusebio Borromeo's title. Further, the parties
were in pari delicto. Since the sale was made during the five-year
prohibitory period, the land would revert to the public domain and the
proper party to institute reversion proceedings was the Office of the
Solicitor General.

The Register of Deeds of Agusan del Sur also filed an Answer, arguing
that the deed of sale was presented for Registration after the five-year
prohibitory period, thus, it was ministerial on its part to register the deed.
The heirs of Borromeo countered that good faith was not a valid defense
because the prohibitory period appeared on the face of the title of the
property.

243
The trial court dismissed the Complaint on the ground of failure to state a
cause of action. Also, the heirs of Borromeo did not have a right of action
because they were unable to establish their status as heirs of the late
Eusebio Borromeo. They may have declared themselves the legal heirs of
Eusebio Borromeo, but they did not present evidence to prove their
allegation. Further, the determination of their rights to succession must be
established in special proceedings.

The trial court also ruled that "[t]he sale was null and void because it was
within the five (5) year prohibitionary [sic] period" under the Public Land
Act. The defense of indefeasibility of title was unavailing because the title
to the property stated that it was "subject to the provisions of Sections 118,
119, 121, 122 and 124" of the Public Land Act. Since the property was sold
within the five-year prohibitory period, such transfer "result[ed] in the
cancellation of the grant and the reversion of the land to the public
domain."

The Court of Appeals reversed the Decision of the trial court and held
that since Eusebio Borromeo sold his property within the five-year
prohibitory period, the property should revert to the state. However, the
government has to file an action for reversion because "reversion is not
automatic." While there is yet no action for reversion instituted by the
Office of the Solicitor General, the property should be returned to the
heirs of Borromeo.

On May 10, 2006, the Maltos Spouses |filed a Petition for Review before
this court, questioning the Decision and Resolution of the Court of
Appeals.

ISSUES:
(1)WON the Court of Appeals erred in reversing the Decision of the trial
court and ordering the reconveyance of the property from petitioners

244
Spouses Eliseo Maltos and Rosita Maltos to respondents heirs of Eusebio
Borromeo.

(2)WON the Court of Appeals erred in ruling that petitioners Spouses

Eliseo Maltos and Rosita Maltos are not entitled to reimbursement for the
improvements they introduced on the land.

RULING:

(1)WON the Court of Appeals erred in reversing the Decision of the trial court
and ordering the reconveyance of the property from petitioners Spouses Eliseo
Maltos and Rosita Maltos to respondents heirs of Eusebio Borromeo.

No, the CA did not err. The main purpose in the grant of a free patent of
homestead is to preserve and keep in the family of the homesteader that
portion of public land which the State has given to him so he may have a
place to live with his family and become a happy citizen and a useful
member of the society. In Jocson v. Soriano, we held that the conservation
of a family home is the purpose of homestead laws. The policy of the state
is to foster, families as the foundation of society, and thus promote
general welfare.

The effect of violating the five-year prohibitory period is provided under

Section 124 of the Public Land Act, which provides:

SECTION 124. Any acquisition, conveyance, alienation, transfer, or other

contract made or executed in violation of any of the provisions of sections one
hundred and eighteen, one hundred and twenty, one hundred and twenty-one,
one hundred and twenty-two, and one hundred and twenty-three of this. Act
shall be unlawful and null and void from its execution and shall produce the
effect of annulling and cancelling the grant, title, patent, or permit originally

245
issued, recognized or confirmed, actually or presumptively, and cause the
reversion of the property and its improvements to the State.

In this case, Section 10187 of the Public Land Act is applicable since title
already vested in Eusebio Borromeo's name. Both the trial court and the
Court of Appeals found that the sale was made within the five-year
prohibitory period. Thus, there is sufficient cause to revert the property in
favor of the state. However, this court cannot declare reversion of the
property in favor of the state in view of the limitation imposed by Section
101 that an action for reversion must first be filed by the Office of the
Solicitor General.

Moreover, this court held that:

Section 124 of the Public Land Act indeed provides that any acquisition,
conveyance or transfer executed in violation of any of its provisions shall be null
and void and shall produce the effect of annulling and cancelling the grant or
patent and cause the reversion of the property to the State, and the principle of
pari delicto has been applied by this Court in a number of cases wherein the
parties to a transaction have proven to be guilty of effected the transaction with
knowledge of the cause of its invalidity. But we doubt if these principles can now
be invoked considering the philosophy and the policy behind the approval of the
Public Land Act. The principle underlying pari delicto as known here and in the
United States is not absolute in its application. It recognizes certain exceptions
one of them being when its enforcement or application runs counter to an avowed
fundamental policy or to public interest. As stated by us in the Rellosa case,
"This doctrine is subject to one important limitation, namely, [']whenever public
policy is considered advanced by allowing either party to sue for relief against the
transaction[']"

The case under consideration comes within the exception above adverted to. Here
appellee desires to nullify a transaction which was done in violation of the law.
Ordinarily the principle of pari delicto would apply to her because her

246
predecessor-in-interest has carried out the sale with the presumed knowledge of
its illegality, but because the subject of the transaction is a piece of public land,
public policy requires that she, as heir, be not prevented from re-acquiring it
because it was given by law to her family for her home and cultivation. This is the
policy on which our homestead law is predicated. This right cannot be waived. "It
is not within the competence of any citizen to barter away what public policy by
law seeks to preserve." We are, therefore, constrained to hold that appellee can
maintain the present action it being in furtherance of this fundamental aim of our
homestead law.(Emphasis supplied, citations omitted)

As the in pari delicto rule is not applicable, the question now arises as to
who between the parties have a better right to possess the subject parcel
of land. This issue was addressed in Santos:

What is important to consider now is who of the parties is the better entitled to
the possession of the land while the government does not take steps to assert its
title to the homestead. Upon annulment of the sale, the purchaser's claim is
reduced to the purchase price and its interest. As against the vendor or his heirs,
the purchaser is no more entitled to keep the land than any intruder. Such is the
situation of the appellants. Their right to remain in possession of the land is no
better than that of appellee and, therefore, they should not be allowed to remain in
it to the prejudice of appellee during and until the government takes steps toward
its reversion to the State. (Emphasis supplied, citation omitted)

In Binayug v. Ugaddan, which involved the sale of two properties

covered by a homestead patent, this court cited jurisprudence showing
that in cases involving the sale of a property covered by the five-year
prohibitory period, the property should be returned to the grantee.

Applying the ruling in Santos and Binayug, this court makes it clear that
petitioners have no better right to remain in possession of the property
against respondents.

247
Hence, the Court of Appeals did not err in ruling that while there is yet no
action for reversion filed by the Office of the Solicitor General, the
property should be conveyed by petitioners to respondents.

(2)WON the Court of Appeals erred in ruling that petitioners Spouses Eliseo
Maltos and Rosita Maltos are not entitled to reimbursement for the
improvements they introduced on the land.
No, the CA did not err. With regard to the claim for reimbursement,
respondents argue that it was not raised as a counterclaim in the Answer
to the Complaint.

During trial, petitioner Eliseo Maltos testified that when he entered the
land, there were around 100 trees, including coconut trees and a few
banana trees. He then planted additional coconut trees which, at the time
of the trial, were already bearing fruit. Petitioner Eliseo Maltos' testimony
was not rebutted by respondents.

The general rule is that “a compulsory counterclaim . . . not set up shall be

barred. Further, the computation of the value of the improvements on the
land entails findings of fact.

In any case, the Court of Appeals did not err when it stated in its
Resolution dated April 7, 2006 that:

With respect to Appellees' claim for the reimbursement of the

improvements on the land in question, they are hereby declared to have
lost and forfeited the value of the necessary improvements that they made
thereon in the same manner that Appellants should lose the value of the
products gathered by the Appellees from the said land.

248
Restating the rulings in Angeles and Arsenal, this court finds that while
the rule on in pari delicto does not apply policy, if its effect is to violate
public policy it is applicable with regard to value of the improvements
introduced by petitioner Eliseo Maltos. Petitioners had been in possession
of the land for 20 years before the heirs of Borromeo filed a Complaint.
The expenses incurred by petitioners in introducing improvements on the
land for which they seek reimbursement should already be compensated
by the fruits they received from the improvements.

249
 PEDRO MENDOZA, SUBSTITUTED BY HIS HEIRS FEDERICO
MENDOZA AND DELFIN MENDOZA, AND JOSE GONZALES
vs. REYNOSA VALTE

G.R. No. 172961, September 07, 2015

LEONEN, J.

DOCTRINE:

A petition for review filed under Rule 45 may raise only questions of law. The
factual findings by the Court of Appeals, when supported by substantial
evidence, are generally conclusive and binding on the parties and are no longer
reviewable unless the case falls under the recognized exceptions. This court is not
a trier of facts and we are not duty bound to re-examine evidence.

FACTS:

Sometime in 1978, Reynosa Valte filed a free patent

application dated July 6, 1978 for a 7.2253-hectare parcel of land in San
Isidro, Lupao, Nueva Ecija. The application listed Procopio Vallega and
Pedro Mendoza as witnesses who would testify to the truth of the
allegations in Valte's application.
On December 28, 1978, the Bureau of Lands approved Valte's application
and issued Free Patent No. 586435. On January 31, 1979, the Cabanatuan
City Register of Deeds issued OCT No. P-10119.
On December 6, 1982, Mendoza and Jose Gonzales (Gonzales) filed a
protest against Valte's application, claiming to be "the lawful owner and
possessors] since 1930 thru predecessor-in-interest and who had been in
actual uninterrupted, open, peaceful, exclusive, and adverse possession in
the concept of an owner of the above-described property.
Mendoza and Gonzales alleged that Valte procured Free Patent No.
586435 by means of fraud, misrepresentation, and connivance.

250
ISSUE:

Whether this case falls within the exceptions that allow the examination of
questions of fact before this court

RULING:

A petition for review filed under Rule 45 may raise only questions of law.
The factual findings by the Court of Appeals, when supported by
substantial evidence, are generally conclusive and binding on the parties
and are no longer reviewable unless the case falls under the recognized
exceptions. This court is not a trier of facts and we are not duty bound to
re-examine evidence. The existence or non-existence of fraud in an
application for free patent depends on a finding of fact insofar as the
presence of its requirements. Unless it can be shown that irregularity
tainted the free patent proceedings conducted before the Director of
Lands, the presumption that official duty has been regularly
performed stands. The identity of the land in controversy involves a
factual question. Only questions of law may be raised in a petition for
review before this court. This rule admits of exceptions, and petitioners
invoke these exceptions, in that the factual findings of the Court of
Appeals and of the Office of the President are at variance with each other,
the factual findings of the Court of Appeals are contrary to the parties'
evidence, and the factual findings of the Court of Appeals were made
with grave abuse of discretion.

A question of law exists when the doubt or controversy concerns the

correct application of law or jurisprudence to a certain set of facts; or
when the issue does not call for an examination of the probative value of
the evidence presented, the truth or falsehood of facts being admitted. A
question of fact exists when the doubt or difference arises as to the truth
or falsehood of facts or when the query invites calibration of the whole
evidence considering mainly the credibility of the witnesses, the existence
and relevancy of specific surrounding circumstances, as well as their
relation to each other and to the whole, and the probability of the
situation.

251
Since this court is not a trier of facts, we are not duty-bound to re-examine
evidence already considered by the lower courts. Factual findings by the
Court of Appeals, when supported by substantial evidence, are generally
conclusive and binding on the parties and will no longer be reviewed by
this court.

252
 LORENZO SHIPPING CORPORATION vs NATIONAL POWER
CORPORATION
G.R. No. 181683

October 07, 2015

LEONEN, J.

DOCTRINE:

Admissibility of evidence and weight accorded to evidence are two distinct affairs.
Rule 128, Section 3 of the Revised Rules on Evidence governs admissibility and
provides that "evidence is admissible when it is relevant to the issue and is not
excluded by the law of these rules." When evidence has "such a relation to the
fact in issue as to induce belief in its existence or non-existence," it is said to be
relevant. When evidence is not excluded by law or by the Rules, it is said to be
competent.

FACTS:

Lorenzo Shipping is the owner and operator of the commercial

vessel MV Lorcon Luzon. National Power Corporation is the owner of
Power Barge 104, "a non-propelled power plant barge." On March 20,
1993, Power Barge 104 was berthed and stationed at the Makar Wharf in
General Santos City when the MV Lorcon Luzon "hit and rammed Power
Barge 104." At the time of the incident, Captain Mariano Villarias (Captain
Villarias) served as the Master of the MV Lorcon Luzon. However, the
MV Lorcon Luzon was then being piloted by Captain Homer Yape
(Captain Yape), a Harbor Pilot from the General Santos City pilotage
district. As underscored by Lorenzo Shipping, the MV Lorcon Luzon was
under Captain Yape's pilotage as it was mandatory to yield navigational
control to the Harbor Pilot while docking. Following this incident, Nelson
Homena, Plant Manager of Power Barge 104, filed a Marine Protest before
the Board of Marine Inquiry. Captain Villarias also filed his own Marine
Protest. For his part, Captain Yape filed a Marine Accident Report. The
Board of Marine Inquiry conducted joint hearings on the Marine Protests
and Captain Yape's report.

253
ISSUE:

Whether or not the evidence presented is admissible.

RULING:
No. It is basic that any material presented as evidence will not be
considered unless duly admitted by the court before which it is presented.
Just as basic is that a private document offered as authentic evidence shall
not be admitted unless its due execution and authenticity are established
in the manner specified by Rule 132 of the Revised Rules on Evidence.

A bill of expenses, such as National Power Corporation's Exhibit "F", is

considered a private document as it does not fall under what the Revised
Rules on Evidence defines to be public documents. Accordingly, for it to
have been admitted by the Regional Trial Court as authentic, Rule 132,
Section 30 of the Revised Rules on Evidence must have been complied
with. National Power Corporation failed in this respect. Thus, in the
words of the Regional Trial Court.

Admissibility of evidence and weight accorded to evidence are two

distinct affairs. Rule 128, Section 3 of the Revised Rules on Evidence
governs admissibility and provides that "evidence is admissible when it is
relevant to the issue and is not excluded by the law of these rules." When
evidence has "such a relation to the fact in issue as to induce belief in its
existence or non-existence," it is said to be relevant. When evidence is not
excluded by law or by the Rules, it is said to be competent.

The weight accorded to evidence is properly considered only after

evidence has been admitted. To this end, courts evaluate evidence in
accordance with the rules stipulated by Rule 133 of the Revised Rules on
Evidence, consistent with basic precepts of rationality and guided by
judicially established standards. It is improper to even speak of
evidentiary weight when the piece of evidence in question has not even
been admitted.

254
 PHILIPPINE NATIONAL CONSTRUCTION CORPORATION vs.
ASIAVEST MERCHANT BANKERS (M) BERHAD

G.R. No. 172301

August 19, 2015

LEONEN, J.:

DOCTRINE:

A plain reading of Section 19 shows that civil actions for payment of sum of
money are within the exclusive original jurisdiction of trial courts. In all other
cases in which the demand, exclusive of interest, damages of whatever kind,
attorney's fees, litigation expenses, and costs or the value of the property in
controversy exceeds Three hundred thousand pesos (P300,000) or, in such other
cases in Metro Manila, where the demand, exclusive of the abovementioned items
exceeds Four hundred thousand pesos (P400,000).

FACTS:

PNCC and Asiavest Holdings (M) Sdn. Bhd. (Asiavest Holdings)

caused the incorporation of an associate company known as Asiavest-
CDCP Sdn. Bhd. (Asiavest-CDCP), through which they entered into
contracts to construct rural roads and bridges for the State of Pahang,
Malaysia. In connection with this construction contract, PNCC obtained
various guarantees and bonds from Asiavest Merchant Bankers (M)
Berhad to guarantee the due performance of its obligations. The four
contracts of guaranty stipulate that Asiavest Merchant Bankers (M)
Berhad shall guarantee to the State of Pahang "the due performance by
PNCC of its construction contracts . . . and the repayment of the
temporary advances given to PNCC[.]" These contracts were understood
to be governed by the laws of Malaysia. There was failure to perform the
obligations under the construction contract, prompting the State of
Pahang to demand payment against Asiavest Merchant Bankers (M)
Berhad's performance bonds. It "entered into a compromise agreement
with the State of Pahang by paying . . . the reduced amount of [Malaysian
Ringgit (MYR)] 3,915,053.54[.]" Consequently, the corporation demanded

255
indemnity from PNCC by demanding the amount it paid to the State of
Pahang. On April 12, 1994, Asiavest Merchant Bankers (M) Berhad filed a
Complaint for recovery of sum of money against PNCC before the
Regional Trial Court of Pasig. It based its action on Malaysian laws. The
Regional Trial Court rendered judgment in favor of Asiavest Merchant
Bankers (M) Berhad.

ISSUE:

Whether our courts have subject matter jurisdiction over an action for
recovery of sum of money filed by a Malaysian corporation against a
Philippine corporation involving a contract executed and performed in
Malaysia, and the applicability of the forum non conveniens principle.

RULING:

On the jurisdiction issue, jurisdiction over the subject matter is conferred

by law. Batas Pambansa Blg. 129, otherwise known as The Judiciary
Reorganization Act of 1980, is one such law that provides for the
jurisdiction of our courts. A plain reading of Section 19 shows that civil
actions for payment of sum of money are within the exclusive original
jurisdiction of trial courts. In all other cases in which the demand,
exclusive of interest, damages of whatever kind, attorney's fees, litigation
expenses, and costs or the value of the property in controversy exceeds
Three hundred thousand pesos (P300,000) or, in such other cases in Metro
Manila, where the demand, exclusive of the abovementioned items
exceeds Four hundred thousand pesos (P400,000). Thus, the Regional
Trial Court of Pasig has jurisdiction over respondent's complaint for
recovery of the sum of money.

"Forum non conveniens literally translates to 'the forum is

inconvenient.'" This doctrine applies in conflicts of law cases. It gives
courts the choice of not assuming jurisdiction when it appears that it is
not the most convenient forum and the parties may seek redress in
another one. It is a device "designed to frustrate illicit means for securing
advantages and vexing litigants that would otherwise be possible if the

256
venue of litigation (or dispute resolution) were left entirely to the whim of
either party."

The determination of whether to entertain a case is addressed to the

sound discretion of the court, which must carefully consider the facts of
the particular case. A mere invocation of the doctrine of forum non
conveniens or an easy averment that foreign elements exist cannot operate
to automatically divest a court of its jurisdiction.

257
 JUN B. LUNA vs. ATTY. DWIGHT M. GALARRITA

A.C. No. 10662

July 7, 2015

LEONEN, J.:

DOCTRINE:

SEC. 23. Authority of attorneys to bind clients. – Attorneys have authority to

bind their clients in any case by any agreement in relation thereto made in
writing and in taking appeals, and in all matters of ordinary judicial
procedure. But they cannot, without special authority, compromise their client’s
litigation, or receive anything in discharge of a client’s claim but the full amount
in cash.

FACTS:

On April 7, 2010, Jun B. Luna (Luna) filed an Affidavit-Complaint

against his lawyer, Atty. Dwight M. Galarrita (Atty. Galarrita), before the
Integrated Bar of the Philippines. Luna alleged that he retained Atty.
Galarrita’s legal services in filing a foreclosure Complaint on October 14,
2002 before the Regional Trial Court of Gumaca, Quezon The Complaint
against one Jose Calvario (Calvario) alleged that Calvario borrowed
P100,000.00 from Luna. This loan was secured by a Deed of Real Estate
Mortgage4 over a parcel of land in Quezon Province. Due to non-payment
of the loan, Luna filed the Complaint praying for payment of the
obligation with interest, and issuance of a foreclosure decree upon
Calvario’s failure to fully pay within the period. The parties tried to
amicably settle the case during pre-trial, followed by Luna’s presentation
and offer of evidence.

Atty. Galarrita opted to enter into a settlement with the other party after
his formal offer of evidence. They submitted the Kasunduan (Compromise
Agreement) before the trial court on February 14, 2006 which the trial

258
court approved. Luna alleged that Atty. Galarrita never informed him of
this Compromise Agreement, and did not deliver to him the P100,000.00
settlement proceeds Atty. Galarrita had received.

ISSUE:

Whether or not respondent Atty. Galarrita should be held

administratively liable for entering into a Compromise Agreement
without his client complainant Luna’s consent, then refusing to turn over
the settlement proceeds received.

RULING:

Yes. The Rules of Court thus requires lawyers to secure special authority
from their clients when entering into a compromise agreement that
dispenses with litigation:

SEC. 23. Authority of attorneys to bind clients. – Attorneys have authority to

bind their clients in any case by any agreement in relation thereto made in
writing and in taking appeals, and in all matters of ordinary judicial
procedure. But they cannot, without special authority, compromise their
client’s litigation, or receive anything in discharge of a client’s claim but
the full amount in cash.

Respondent Atty. Galarrita does not deny his receipt of the P100,000.00
but justifies his refusal to turn over the amount by invoking jurisprudence
on retaining lien. The Rules of Court provides for attorney’s retaining lien
as follows:

SEC. 37. Attorney’s liens. – An attorney shall have a lien upon the funds,
documents and papers of his client which have lawfully come into his
possession and may retain the same until his lawful fees and
disbursements have been paid, and may apply such funds to the

259
satisfaction thereof. He shall also have a lien to the same extent upon all
judgments for the payment of money, and executions issued in pursuance
of such judgments, which he has secured in a litigation of his client, from
and after the time when he shall have caused a statement of his claim of
such lien to be entered upon the records of the court rendering such
judgment, or issuing such execution, and shall have caused written notice
thereof to be delivered to his client and to the adverse party; and he shall
have the same right and power over such judgments and executions as his
client would have enforce his lien and secure the payment of his just fees
and disbursements.

Respondent Atty. Galarrita refused to comply with these duties,

warranting his suspension from the practice of law.

260
 ISMAEL V. CRISOSTOMO vs MARTIN P. VICTORIA

G.R. No. 175098

August 26, 2015

LEONEN, J.

DOCTRINE:
Rule 45 provides that a party desiring to appeal by certiorari from a judgment or
final order or resolution of the Court of Appeals, the Sandiganbayan, the
Regional Trial Court or other courts whenever authorized y law, may file with
the Supreme Court a verified petition for review on certiorari. The petition shall
raise only questions of law which must be distinctly set forth.

FACTS:

In a Complaint for Ejectment filed before the Office of the Provincial

Agrarian Reform Adjudicator of Bulacan, Crisostomo alleged that he,
along with his deceased brother Jose Crisostomo, were the registered
owners of a parcel of rice land with an area of 562,694 square meters. On
June 21, 1973, he and his brother allegedly entered into a lease contract
with David Hipolito (Hipolito) over a portion of the rice land (disputed
portion). The contract was supposedly in effect until Hipolito's death on
December 2, 1999. As Hipolito died without any known heirs, Crisostomo
was set to reclaim possession and to take over cultivation of the disputed
portion. However, in January 2000, Victoria entered the disputed portion
and began cultivating it without the knowledge and consent of
Crisostomo. Crisostomo confronted Victoria, who insisted that he had
tenancy rights over the disputed portion.
In his Answer, Victoria claimed that Hipolito was his uncle. He alleged
that even during the lifetime of Hipolito, it was he who was doing farm
work on the disputed portion and that he did so with Crisostomo's
knowledge. He asserted that Crisostomo's act of receiving lease rentals
from him amounted to implied consent, which gave rise to a tenancy

261
relationship between them.

In its April 7, 2003 Decision, the Office of the Provincial Agrarian Reform
Adjudicator of Bulacan ruled in favor of Crisostomo and ordered Victoria,
together with all persons claiming rights under him, to vacate the
disputed portion and surrender its possession to Crisostomo. This was
reversed by the Court of Appeals.

ISSUE:

Whether or not Petition for review under Rule 45 should be granted.

RULING:

Yes. Rule 45 provides that a party desiring to appeal by certiorari from a

judgment or final order or resolution of the Court of Appeals, the
Sandiganbayan, the Regional Trial Court or other courts whenever
authorized y law, may file with the Supreme Court a verified petition for
review on certiorari. The petition shall raise only questions of law which
must be distinctly set forth.

There is nothing in this case to indicate that Hipolito exercised rights and
prerogatives that accrue to the landowner and which could imply that he
was in such a situation where he could exercise a landowner's
competencies. Hipolito was not clothed with authority to "allow"
respondent to be the tenant himself. Hipolito, as lessee, was entitled to
possession of the disputed portion, and legally so. He was, in this sense, a
"legal possessor." However, his capacities ended here. There was nothing
that authorized him to enter into a tenancy relation with another. To hold
that respondent is the bona fide tenant of the disputed portion would be
to extend petitioner's dispossession for a period much longer that he had
originally contemplated. It puts him at the mercy of a person whom he

262
recognized as a tenant. This is precisely the "economic dislocation" that
this court warned against in Calderon. To hold as such would be to permit
agrarian reform laws to be used as a convenient artifice for investing in a
supposed tenant rights that far exceed those of the owner.

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 Jovita S. Manalo, Petitioner, v. Ateneo de Naga University, Fr. Joel
Taborda and Mr. Edwin Bernal, Respondent.

G.R. No. 185058

November 9, 2015

Leonen, J.

DOCTRINE:
Judicial review of decisions of the National Labor Relations Commission is
permitted. However, this review is through a petition for certiorari (i.e., special
civil action for certiorari) under Rule 65 of the Rules of Court, rather than
through an appeal.

A petition for certiorari under Rule 65 is an original action. It is independent of

the action that gave rise to the assailed ruling. In contrast, a petition
for review on certiorari under Rule 45 is a mode of appeal. Thus, it is a
continuation of the case subject of the appeal.

FACTS:

Manalo was a regular and permanent full-time faculty member of

the Accountancy Department of Ateneo de Naga University's College of
Commerce. She was employed on June 3, 1993 and was granted
permanent status in 1996. As recounted by Manalo in the Position Paper
she filed before the Labor Arbiter, she taught subjects such as "Auditing
Theory, Auditing Practice, Financial Accounting, [and] Elementary
Accounting." She respondent in the Reply to respondent’s position paper
that she taught the subjects albeit insisting that she did not have the
required aptitude and competence.

Manalo further recounted that on December 14, 1999, Bernal wrote to Fr.
Tabora, Ateneo de Naga University President, recommending the

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termination of her employment on the grounds of serious business
malpractice, palpable dishonesty, and questionable integrity.

Acting on the charges against Manalo, Fr. Tabora constituted a Grievance

Committee. The Grievance Committee later found Manalo guilty and
recommended her dismissal.
Acting on the Grievance Committee's recommendation as the University
President had the "final say on the matter," Fr. Tabora instead opted to
transfer Manalo to teach Economics in the Department of Social Sciences
of Ateneo de Naga University's College of Arts and Science.

Alleging that her transfer constituted constructive dismissal, Manalo filed

a Complaint.

The Labor Arbiter found that Manalo was constructively dismissed. HE

ordered Manalo be reinstated to her former position in the Accountancy
Department. The NLRC 2nd Division affirmed in toto that decision of the
Labor Arbiter. Respondent’s filed a Petition for Certiorari before the CA
upon denial for their motion for reconsideration before the NLRC.

The Court of Appeals reversed and set aside the rulings of the LA and the
NLRC and ordered Manalo’s complaint be dismissed. The CA notes that
there was ample factual basis for Manalo’s transfer, and that such transfer
was well within the scope of Ateneo de Naga University’s prerogatives as
an employer and as an educational institution.

Aggrieved, Manalo filed the present Petition for Review on Certiorari. She
assails the supposed impropriety of the Court of Appeals' ruling that set
aside the findings of Labor Arbiter Quiñones and of the National Labor
Relations Commission. She insists that their findings are conclusive and
binding on the Court of Appeals and that alternative findings could not
have been the basis for reversing their rulings.

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ISSUE:

Whether or not the Court of Appeals was in error for entertaining

alternative findings to those made by LA and the NLRC

RULING:

No. The Supreme Court held that as clarified in St. Martin Funeral
Homes v. National Labor Relations Commission, judicial review of decisions
of the National Labor Relations Commission is permitted. However, this
review is through a petition for certiorari (i.e., special civil action for
certiorari) under Rule 65 of the Rules of Court, rather than through an
appeal. Moreover, although this court has concurrent jurisdiction with the
Court of Appeals as regards petitions for certiorari, such petitions are
filed before the Court of Appeals (following, of course, the National Labor
Relations Commission's denial of the appropriate Motion for
Reconsideration), rather than directly before this court. This is consistent
with the principle of hierarchy of courts. It is only from an adverse ruling
of the Court of Appeals that a party may come to this court, which shall
then be by way of a petition for review on certiorari (i.e., appeal by
certiorari) under Rule 45 of the Rules of Court.

A petition for certiorari under Rule 65 is an original action. It is

independent of the action that gave rise to the assailed ruling. In contrast,
a petition for review on certiorari under Rule 45 is a mode of appeal. Thus,
it is a continuation of the case subject of the appeal. It follows then that it
cannot go beyond the issues that were properly the subject of the original
action from which it arose.

From these, it is a clear error for petitioner to insist that the figurative
hands of the Court of Appeals were tied just because the findings of the
Labor Arbiter and of the National Labor Relations coincided with each
other. Precisely because it was confronted with a Rule 65 Petition, it was

266
the Court of Appeals' business to determine whether there had been
grave abuse of discretion amounting to lack or excess of jurisdiction. Had
it found that there was none, the proper course of action would have been
to dismiss respondents' Rule 65 Petition and to sustain the rulings of
Labor Arbiter Quiñones and of the National Labor Relations Commission.

267
 Metropolitan Bank & Trust Company, Petitioner, v. G & p Builders,
Invorporated, Spouses Elpidio and Rose Violet Paras, Spouses Jesus
and Ma. Consuelo Paras and Victoria Paras, Respondents.

G.R. No. 189509

November 23, 2015

Leonen, J.

DOCTRINE:
An order is final if "the order or judgment ends the litigation in the lower
court." It is interlocutory if the order simply resolves matters incidental to the
main case and still leaves something to be done on the part of the court relating to
the merits of the case.

In this case, the assailed orders of the trial court are interlocutory in nature.

Petitioner committed a procedural error when it filed a Petition for Review before
the Court of Appeals instead of filing a Petition for Certiorari under Rule 65 of
the Rules of Court.

FACTS:

On March 17, 2003, respondent G & P Builders, Incorporated (G &

P) filed a Petition for Rehabilitation before Branch 40 of the Misamis
Oriental Regional Trial Court, docketed as Spec. Pro. No. 2003-
041. Among the allegations in the Petition is that G & P "obtained a loan
from Metrobank and mortgaged twelve (12) parcels of land as
collateral[.]" G & P's loan obligation amounted to P52,094,711.00 at the
time of the filing of the Petition before the trial court.

However, while the rehabilitation proceedings were pending, Metrobank

and G & P executed a Memorandum of Agreement (first MOA) on

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August 11, 2003, where the parties agreed that four (4) out of the 12
parcels of land mortgaged would be released and sold.

The trial court approved the first MOA as a compromise agreement

between parties.

G&P entered into compromise agreements with its other creditors as

approved by the rehabilitation court. Metrobank entered into a Loan Sale
and Purchase Agreement with Elite Union Investments Limited (Elite
Union). Metrobank sold G&P’s loan account for P10,419,000.00.

The rehabilitation court granted G&P’s motion and ordered the release of
unapplied deposit with Metrobank. Metrobank moved for
reconsideration of the trail court’s Order. However, the motion as denied
on October 10, 2007. Metrobank then filed before the CA a Petition for
Review under Rule 43 of the Rules of Court assailing the April 2, 2007 and
October 10, 2007 Orders of the rehabilitation court.

The Court of Appeals reversed and set aside the April 2, 2007 Order of the
rehabilitation court. According to the Court of Appeals, G & P has no
interest nor personality in asking for the release of the deposit since the
loan account was finally sold to Spouses Victor and Lani Paras.

The Court of Appeals also observed that the Petition should have been
dismissed outright since the assailed April 2, 2007 Order was a mere
interlocutory order and could not be assailed through a Petition for
Review under Rule 43 of the Rules of Court.

Metrobank filed the present Petition for Review with prayer for the
issuance of a temporary restraining order and/or a writ of preliminary
injunction. Petitioner claims that the Court of Appeals already gave due
course to the Petition; hence, its Decision and Resolution are appealable to
the SC under Rule 45 of the Rules of Court.

269
ISSUE:

Whether or not the Orders of the trial court are interlocutory orders
and, thus, not appealable to the Court of Appeals via Rule 43 of the Rules
of Court

RULING:

No. The trial court's Orders are conclusive as to the release of the
deposit to G & P until assailed and reversed on appeal. Under A.M. No.
04-9-07-SC, which provides for the mode of appeal in cases involving
corporate rehabilitation, all decisions and final orders rendered by the
trial court shall be appealed to the Court of Appeals through a petition for
review under Rule 43 of the Rules of Court.

he distinction between a final order and an interlocutory order has been

doctrinally settled.

This court has laid down the test to determine whether an order is final or
merely interlocutory: "Does it leave something to be done in the trial court
with respect to the merits of the case? If it does, it is interlocutory; if it
does not, it is final." This test was applied in Metropolitan Bank & Trust
Company v. Court of Appeals, where this court distinguished an
interlocutory order from a final order to determine if the private
respondent properly appealed the trial court's order regarding improper
implementation of a writ of execution:

It has been held that "[a]n interlocutory order does not terminate or
finally dismiss or finally dispose of the case, but leaves something to be
done by the court before the case is finally decided on the merits." It
"refers to something between the commencement and end of the suit
which decides some point or matter but it is not the final decision on the

270
whole controversy." Conversely, a final order is one which leaves to the
court nothing more to do to resolve the case. . . .

An order is final if "the order or judgment ends the litigation in the lower
court." It is interlocutory if the order simply resolves matters incidental to
the main case and still leaves something to be done on the part of the
court relating to the merits of the case.

In this case, the assailed orders of the trial court are interlocutory in
nature.

Petitioner committed a procedural error when it filed a Petition for

Review before the Court of Appeals instead of filing a Petition for
Certiorari under Rule 65 of the Rules of Court. The distinction is
important because "[t]he remedy against an interlocutory order not
subject of an appeal is an appropriate special civil action under Rule 65
[.]"

Moreover, in contrast to a final judgment or order, an interlocutory order

"may not be questioned on appeal except only as part of an appeal that
may eventually be taken from the final judgment rendered in the case."

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Republic of the Philippines, Represented by Asset Privatization Trust,
Now Privatization and Management Office (PMO), Petitioner, v.
Virgilio M. Tatlonghari, Domingo P. Uy, Guillermo P. Uy, Hinosan
Mtors Corporation, and Western Guaranty Corporation, Respondents.

G.R. No. 170458

November 23, 2015

Leonen, J.

DOCTRINE:
Asset Privatization Trust could no longer question the Notice of Levy and/or Sale
on Execution because the order denying the third-party claim became final and
executory.

FACTS:

Pantranco was formerly a government-owned and controlled

corporation without original charter. Sometime in 1972, Pantranco
suffered financial losses. One of Pantranco's creditors was Philippine
National Bank. Pantranco's assets was foreclosed by Philippine National
Bank, and in 1978, the ownership of Pantranco was transferred to the
National Investment Development Corporation, a subsidiary of the
Philippine National Bank.

In 1985, National Investment Development Corporation sold Pantranco to

North Express Transport, Inc., which was owned by Gregorio Araneta
III, while Pantranco's assets were sold to Max B. Potenciano, Max Joseph
A. Potenciano, and Dolores A. Potenciano. The Potencianos thereafter
incorporated Pantranco as a private corporation.

After the 1986 People Power Revolution, Pantranco was sequestered by

the Presidential Commission on Good Government. Pantranco was
allegedly part of Ferdinand Marcos' ill-gotten wealth and was acquired by

272
using Gregorio Araneta III and the Potencianos as dummies.

The sequestration was lifted in 1988 "to give way to the sale of Pantranco
North Express Inc." At that time, Asset Privatization Trust took over
Pantranco's management.

On May 26, 1988, a Complaint was filed against Pantranco. In the case, the
trial court (TC) allowed the sale of Pantranco’s assets.

On August 20, 1993, Asset Privatization Trust, representing the Republic

of the Philippines, filed several cases under Rule 39, Section 16 of the 1997
Rules of Civil Procedure, with claim for damages. On August 20, 1993,
Asset Privatization Trust, representing the Republic of the Philippines,
filed several cases under Rule 39, Section 16 of the 1997 Rules of Civil
Procedure, with claim for damages. The trial court ruled in favor of the
Republic and stated that since Section 33 of Proclamation No. 50 provides
that proceeds from the sale of assets form part of the general fund of
national government, the assets in this case should automatically be
considered as part of the general fund. Hence, the funds deposited by
Asset Privatization Trust are public funds that cannot be garnished.

The CA reversed the Decision of the TC and held that the funds were not
public. It also ruled that the subject funds can be garnished and be used to
satisfy the claims of the respondents.

The Asset Privatization Trust, through the OSG filed a Petition for
Review. Petitioner's argument that it was authorized to collect Pantranco's
debt to Philippine National Bank was addressed by this court in Republic
v. Pantranco North Express, Inc.
In Republic v. Pantranco North Express, Inc., a Notice of Levy/Sale on
Execution of Personal Property was issued over several properties owned
by Pantranco, in relation to a labor case filed by Pantranco's retrenched
employees. Asset Privatization Trust filed a Notice of Third-Party Claim.
It claimed that the levied properties "[were] mortgaged to the National

273
Government" and "that the National Government ha[d] a superior lien
over the properties."

The Labor Arbiter denied the third-party claim, the denial of which was
affirmed by the National Labor Relations Commission. The Office of the
Solicitor General filed a Petition for Certiorari before the Court of Appeals
without moving for reconsideration of the Decision of the National Labor
Relations Commission. Thus, the Court of Appeals dismissed the Petition
for Certiorari.

ISSUE:

Whether or not the Court of Appeals erred in dismissing Asset

Privatization Trust’s Petition for Certiorari for failure to file a Motion for
Reconsideration before the NLRC in Republic v. Pantranco North Express,
Inc.

RULING:

No. The Supreme Court held that there was no error on the part of
the Court of Appeals. Asset Privatization Trust could no longer question
the Notice of Levy and/or Sale on Execution because the order denying
the third-party claim became final and executory. Even when the
procedural infirmity was brush aside, there was still no error on the part
of the CA since no evidence was presented to show that the properties of
Pantranco levied upon “were among those included in the list of accounts
that were transferred to the National Government and which were
subsequently transferred to the Asset Privatization Trust.

274
 Melanie E. De Ocampo, Petitioner, v. RPN-9/Radio Philippines
Network, Inc., Respondent.

G.R. No. 192947

December 9, 2015

Leonen, J.

DOCTRINE:
Unlike an appeal, a pending petition for certiorari shall not stay the judgment or
order that it assails. Unless a restraining order or writ of preliminary injunction
is issued, the assailed decision lapses into finality. Thereafter, it can no longer be
disturbed, altered, or modified, and execution may ensue.

FACTS:

De Ocampo was the complainant in a case for illegal dismissal,

unpaid salaries, damages, and attorney's fees against respondent Radio
Philippines Network, Inc. (RPN-9) and several RPN-9 officers. The
Executive Labor Arbiter (LA) found De Ocampo to have been illegally
dismissed. RPN-9 was ordered to pay her separation pay in lieu of
reinstatement and full backwages. The NLRC affirmed the Decision of the
LA. RPN-9 filed before the CA a Petition for Ceriorari with prayer for
temporary restraining order and/or preliminary injunction. The CA
issued a temporary restraining order preventing the NLRC from
enforcing its ruling for a period of 60 days. The 60-day period lapsed
without a writ of preliminary injunction being subsequently issued by the
CA. Accordingly, the ruling of the LA as affirmed by the NLRC became
final and executory.

De Ocampo then filed a Motion for Issuance of Writ of Execution. The

NLRC granted the motion. A writ of Execution was issued and directed
the Deputy Sheriff to collect from RPN-9 the total amount of P410, 826.85.

275
The amount was fully satisfied, but full satisfaction of the original award
notwithstanding, De Ocampo filed a Motion to Recompute the Monetary
Award with Motion to Issue Alias Writ of Execution. She sought the
increase of the monetary award given to her.

The LA denied De Ocampo’s Motion to recompute ruling that the Dection

fixing the amounts of the monetary award due to De Ocampo had
become final and executory. The NLRC sustained the LA and denied De
Ocampo’s subsequent MR. CA dismissed De Ocampo’s Petition for
Certiorari and sustained the decision of the NLRC and subsequently
denied De Ocampo’s MR.

ISSUE:

Whether De Ocampo may still seek a recomputation of and an

increase in the monetary award given her

RULING:

No. The Supreme Court held that it is basic that a judgment can no
longer be disturbed, altered, or modified as soon as it becomes final and
executory; "[n]othing is more settled in law." Once a case is decided with
finality, "the controversy is settled and the matter is laid to
rest." Accordingly, a final judgment may no longer be modified in any
respect "even if the modification is meant to correct what is perceived to
be an erroneous conclusion of fact or law, and regardless of whether the
modification is attempted to be made by the court rendering it or by the
highest court of the land." Once a judgment becomes final, the court or
tribunal loses jurisdiction, and any modified judgment that it issues, as
well as all proceedings taken for this purpose, is null and void.

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This rule, however, does admit of exceptions. As this court explained
in Sacdalan v. Court of Appeals:

The only exceptions to the general rule are the correction of clerical errors,
the so-called nunc pro tunc entries which cause no prejudice to any party,
void judgments, and whenever circumstances transpire after the finality
of the decision rendering its execution unjust and inequitable. (Citations
omitted)

Consistent with the principle of finality of judgments, it follows that no

appeal may be taken from orders of execution of judgments.

As basic as the principle of finality of judgments is the rule that filing a

petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure
"shall not interrupt the course of the principal case unless a temporary
restraining order or a writ of preliminary injunction has been issued
against the public respondent from further proceeding in the case." Unlike
an appeal, a pending petition for certiorari shall not stay the judgment or
order that it assails.

The 2005 Rules of Procedure of the National Labor Relations Commission,

which were in effect when the material incidents of this case occurred,
explicitly and specifically makes this principle applicable to decisions of
labor arbiters and of the National Labor Relations Commission. Rule XI,
Section 10 of the 2005 Rules of Procedure of the National Labor Relations
Commission states:

SECTION 10. Effect of Petition for Certiorari on Execution. — A petition for

certiorari with the Court of Appeals or the Supreme Court shall not stay
the execution of the assailed decision unless a restraining order is issued
by said courts.

In contrast, Rule XI, Section 9 states the following with respect to appeals:

277
SECTION 9. Effect of Perfection of Appeal on Execution. — The perfection of
an appeal shall stay the execution of the decision of the Labor Arbiter on
appeal, except execution for reinstatement pending appeal.

Accordingly, where no restraining order or writ of preliminary injunction

is issued, the assailed decision lapses into finality.

The pivotal facts of this case are also settled. After the filing before the
Court of Appeals of RPN-9's Petition for Certiorari, the Court of Appeals
issued a temporary restraining order preventing, for a period of 60 days,
the National Labor Relations Commission from enforcing its ruling.
However, the sixty-day period lapsed without a writ of preliminary
injunction being subsequently issued by the Court of Appeals. Thus, on
May 27, 2006, the ruling of Executive Labor Arbiter Manansala, as
affirmed by the National Labor Relations Commission, became final and
executory on May 27, 2006. Conformably, Entry of Judgment was made
on July 19, 2006.
None of the four exceptions mentioned in Sacdalan v. Court of Appeals that
warrant a modification of judgments that have attained finality is availing
in this case.

No recourse, whether in law or equity, leaves room for petitioner to avail

herself of the modifications she seeks. The most basic legal principles
dictate that Executive Labor Arbiter Manansala's Decision—in all its
aspects—has long attained finality and may no longer be revisited.
Principles of equity require that petitioner be bound by her own
omissions and declarations.

278
Caravan Travel and Tours International, Inc., Petitioner, v. Ermilinda R.
Abejar, Respondent.

G.R. Nm’’’’/o. 170631

February 10, 2016

Leonen, J.

DOCTRINES:
I. A real party in interest is the party who stands to be benefited or injured
by the judgment in the suit, or the party entitled to the avails of the suit. Unless
otherwise authorized by law or these Rules, every action must be prosecuted or
defended in the name of the real party in interest.
"To qualify a person to be a real party in interest in whose name an action must
be prosecuted, he [or she] must appear to be the present real owner of the right
sought to be enforced."

II. As defined by Rule 3, Section 7, indispensable parties are "[p]arties in

interest without whom no final determination can be had of an action[.]" Thus,
their non-inclusion is debilitating: "the presence of indispensable parties is a
condition for the exercise of juridical power and when an indispensable party is
not before the court, the action should be dismissed."
In contrast, a necessary party's presence is not imperative, and his or her absence
is not debilitating. Nevertheless, it is preferred that they be included in order that
relief may be complete.

FACTS:

On July 13, 2000, Jesmariane Reyes (Reyes) was walking along the
west-bound lane of Sampaguita Street, United Parañaque Subdivision IV,
Parañaque City. A Mitsubishi L-300 van with plate number PKM 195 was
travelling along the east-bound lane, opposite Reyes. To avoid an
incoming vehicle, the van swerved to its left and hit Reyes. Alex Espinosa
(Espinosa), a witness to the accident, went to her aid and loaded her in the

279
back of the van. Espinosa told the driver of the van, Jimmy Bautista
(Bautista), to bring Reyes to the hospital. Instead of doing so, Bautista
appeared to have left the van parked inside a nearby subdivision with
Reyes still in the van. Fortunately for Reyes, an unidentified civilian came
to help and drove Reyes to the hospital.

Upon investigation, it was found that the registered owner of the van was
Caravan. Caravan is a corporation engaged in the business of organizing
travels and tours. Bautista was Caravan's employee assigned to drive the
van as its service driver.
Caravan shouldered the hospitalization expenses of Reyes. Despite
medical attendance, Reyes died two (2) days after the accident.
Respondent Ermilinda R. Abejar (Abejar), Reyes' paternal aunt and the
person who raised her since she was nine (9) years old, filed before the
Regional Trial Court of Parañaque a Complaint for damages against
Bautista and Caravan.

ISSUE:

1. Whether respondent Ermilinda R. Abejar is a real party in interest

who may bring an action for damages against petitioner Caravan Travel
and Tours International, Inc. on account of Jesmariane R. Reyes' death
(Yes)
2. Whether petitioner’s argument that it should be excused from
liability because Bautista was already dropped as a party has merit (No)

RULING:

1. Yes, The Supreme Court held that having exercised substitute

parental authority, respondent suffered actual loss and is, thus, a real
party in interest in this case.
In her Complaint, respondent made allegations that would sustain her

280
action for damages: that she exercised substitute parental authority over
Reyes; that Reyes' death was caused by the negligence of petitioner and
its driver; and that Reyes' death caused her damage. Respondent properly
filed an action based on quasi-delict. She is a real party in interest.

Rule 3, Section 2 of the 1997 Rules of Civil Procedure defines a real party
in interest:

RULE 3. Parties to Civil Actions

SECTION 2. Parties in Interest. — A real party in interest is the party who

stands to be benefited or injured by the judgment in the suit, or the party
entitled to the avails of the suit. Unless otherwise authorized by law or
these Rules, every action must be prosecuted or defended in the name of
the real party in interest.

"To qualify a person to be a real party in interest in whose name an action

must be prosecuted, he [or she] must appear to be the present real owner
of the right sought to be enforced." Respondent's capacity to file a
complaint against petitioner stems from her having exercised substitute
parental authority over Reyes.

Both of Reyes' parents are already deceased. Reyes' paternal grandparents

are also both deceased. The whereabouts of Reyes' maternal grandparents
are unknown. There is also no record that Reyes has brothers or sisters. It
was under these circumstances that respondent took custody of Reyes
when she was a child, assumed the role of Reyes' parents, and thus,
exercised substitute parental authority over her. As Reyes' custodian,
respondent exercised the full extent of the statutorily recognized rights
and duties of a parent.

Respondent's right to proceed against petitioner, therefore, is based on

two grounds.

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First, respondent suffered actual personal loss. With her affinity for Reyes,
it stands to reason that when Reyes died, respondent suffered the same
anguish that a natural parent would have felt upon the loss of one's child.
It is for this injury — as authentic and personal as that of a natural parent
— that respondent seeks to be indemnified.

Second, respondent is capacitated to do what Reyes' actual parents would

have been capacitated to do.

2. No. The Supreme Court held that the argument of the petitioner is
equally unmeritorious.

Bautista, the driver, was not an indispensable party under Rule 3, Section
7 of the 1997 Rules of Civil Procedure. Rather, he was a necessary party
under Rule 3, Section 8. Instead of insisting that Bautista — who was
nothing more than a necessary party — should not have been dropped as
a defendant, or that petitioner, along with Bautista, should have been
dropped, petitioner (as a co-defendant insisting that the action must
proceed with Bautista as party) could have opted to file a cross-claim
against Bautista as its remedy.

The 1997 Rules of Civil Procedure spell out the rules on joinder of
indispensable and necessary parties. These are intended to afford "a
complete determination of all possible issues, not only between the
parties themselves but also as regards to other persons who may be
affected by the judgment."
However, while an exhaustive resolution of disputes is desired in every
case, the distinction between indispensable parties and necessary parties
delineates a court's capacity to render effective judgment. As defined by
Rule 3, Section 7, indispensable parties are "[p]arties in interest without
whom no final determination can be had of an action[.]" Thus, their non-
inclusion is debilitating: "the presence of indispensable parties is a

282
condition for the exercise of juridical power and when an indispensable
party is not before the court, the action should be dismissed."
In contrast, a necessary party's presence is not imperative, and his or her
absence is not debilitating. Nevertheless, it is preferred that they be
included in order that relief may be complete.

The concept of indispensable parties, as against parties whose inclusion

only allows complete relief, was explained in Arcelona v. Court of Appeals:

An indispensable party is a party who has such an interest in the

controversy or subject matter that a final adjudication cannot be made, in
his absence, without injuring or affecting that interest, a party who has
not only an interest in the subject matter of the controversy, but also has
an interest of such nature that a final decree cannot be made without
affecting his interest or leaving the controversy in such a condition that its
final determination may be wholly inconsistent with equity and good
conscience. It has also been considered that an indispensable party is a
person in whose absence there cannot be a determination between the
parties already before the court which is effective, complete, or equitable.
Further, an indispensable party is one who must be included in an action
before it may properly go forward.

A person is not an indispensable party, however, if his interest in the

controversy or subject matter is separable from the interest of the other
parties, so that it will not necessarily be directly or injuriously affected by
a decree which does complete justice between them. Also, a person is not
an indispensable party if his presence would merely permit complete
relief between him and those already parties to the action, or if he has no
interest in the subject matter of the action. It is not a sufficient reason to
declare a person to be an indispensable party that his presence will avoid
multiple litigation.

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RE: DECISION DATED AUGUST 19, 2008, 3RD DIVISION, COURT
OF APPEALS IN CA-G.R. SP NO. 79904 [HON. DIONISIO DONATO
T. GARCIANO, ET AL. V. HON. PATERNO G. TIAMSON, ETC., ET
AL.], Petitioner, v. ATTY. JOSE DE G. FERRER, Respondent.

A.C. No. 8037

February 17, 2016

Leonen,J.:

DOCTRINE:
The essence of forum shopping is the filing of multiple suits involving the same
parties for the same cause of action, either simultaneously or successively, for the
purpose of obtaining a favorable judgment. It exists when, as a result of an
adverse opinion in one forum, a party seeks a favorable opinion in another, or
when he institutes two or more actions or proceedings grounded on the same
cause to increase the chances of obtaining a favorable decision. An important
factor in determining its existence is the vexation caused to the courts and the
parties-litigants by the filing of similar cases to claim substantially the same
reliefs. Forum shopping exists where the elements of litis pendentia are present or
where a final judgment in one case will amount to res judicata in another. Thus,
the following requisites should concur:

... (a) identity of parties, or at least such parties as represent the same interests in
both actions, (b) identity of rights asserted and relief prayed for, the relief being
founded on the same facts, and (c) the identity of the two preceding particulars is
such that any judgment rendered in the other action will, regardless of which
party is successful, amount to res judicata in the action under consideration.

284
FACTS:

On July 27, 2001, Dionisio Donato T. Garciano, then Mayor of Baras,

Rizal, sought to appoint Rolando Pilapil Lacayan as Sangguniang Bayan
Secretary, replacing Nolasco Vallestero. The appointment was opposed by
Wilfredo Robles, then Vice Mayor of Baras, Rizal. He said that the
position is not vacant and that it is the vice mayor, not the mayor, who
has the authority to appoint the Sangguniang Bayan Secretary.

Garciano insisted and removed Vallestero's name from the payroll.

Vallestero sued Garciano before the Sandiganbayan. Vallestero, Robles,
and other Sangguniang Bayan members also filed a "complaint for
mandamus and damages with preliminary mandatory injunction" against
Garciano and other municipal officials before the RTC-Morong, Rizal.
They sought for the payment of their respective salaries.

On June 24, 2003, the RTC ordered Garciano, et al. to release the funds
and pay Vallestero's salaries and other benefits. Garciano, et al. did not
heed the order; hence, they were found liable for indirect contempt.

Appealing the trial court's ruling, Garciano, et al., through their counsel,
Atty. Ferrer, filed a Petition for Certiorari (First Petition) on October 9,
2003 before the CA (raffled to Eleventh Division).

On October 16, 2003, Garciano, et al., through Atty. Ferrer, filed another
Petition for Certiorari with a prayer for the issuance of a writ of
preliminary injunction and/or temporary restraining order (Second
Petition) before the CA (raffled to Third Division).

285
On the same day, Garciano, et al. filed before the CA Eleventh Division an
Urgent Ex-Parte Motion to Withdraw Petition Under Rule 17 Section 124
of the Revised Rules of Court. They allegedly moved to withdraw the
First Petition to avail themselves of other remedies, especially since a
comment had not yet been filed which was granted on October 24, 2003.

In the Decision dated August 19, 2008, the CA Third Division dismissed
the Second Petition with prejudice due to the deliberate violation of the
rule against forum shopping. The CA found that Garciano, et al., through
Atty. Ferrer, filed two Petitions for Certiorari successively. It also held
that the withdrawal of the First Petition was "intended to camouflage the
glaring and blatant irregularity committed" by Garciano, et al. through
their counsel.

If the withdrawal was, indeed, impelled by the lack of verification of the

other petitioners in the First Petition, then Garciano, et al. should have
called the attention of the Eleventh Division instead of filing the Second
Petition. The CA held that when the Second Petition was filed (and the
existence of the First Petition concealed), forum shopping had already
been committed.

In the Indorsement dated September 1, 2008, Alicia A. Risos-Vidal,

Director for Bar Discipline of the IBP, forwarded the Notice of Judgment
of the CA to the Office of the Bar Confidant.

286
On November 19, 2008, this court resolved to note the Indorsement and
treat the Notice of Judgment as an administrative complaint against Atty.
Ferrer.

In his Report and Recommendation dated November 17, 2009,

Commissioner Salvador B. Hababag adopted the findings of the CA in
toto.

Based on the CA's findings, Commissioner Hababag concluded that Atty.

Ferrer clearly violated the rule on forum shopping. Thus, he
recommended that Atty. Ferrer be suspended for three (3) months from
the practice of law with a stern warning that any similar infraction in the
future would be dealt with more severely.

On February 13, 2013, the IBP Board of Governors issued Resolution No.
XX-2013-132, which resolved to adopt and approve the Report and
Recommendation of Commissioner Hababag. It recommended that the
penalty of Atty. Ferrer be reprimand with a warning that a repetition of
the same act shall be dealt with more severely. The IBP Commission on
Bar Discipline then transmitted the Notice of Resolution to this court
through a letter dated October 7, 2013.

ISSUE:

Whether or not respondent Atty. Jose De G. Ferrer should be held

administratively liable for violating the rule against forum shopping.

RULING: YES.

287
Rule 7, Section 5 of the Rules of Court provides the rule against forum
shopping:

Sec. 5. Certification against forum shopping. — The plaintiff or principal party

shall certify under oath in the complaint or other initiatory pleading asserting a
claim for relief, or in a sworn certification annexed thereto and simultaneously
filed therewith: (a) that he has not theretofore commenced any action or filed any
claim involving the same issues in any court, tribunal or quasi-judicial agency
and, to the best of his knowledge, no such other action or claim is pending
therein; (b) if there is such other pending action or claim, a complete statement of
the present status thereof; and (c) if he should thereafter learn that the same or
similar action or claim has been filed or is pending, he shall report that fact
within five (5) days therefrom to the court wherein his aforesaid complaint or
initiatory pleading has been filed.

Failure to comply with the foregoing requirements shall not be curable by mere
amendment of the complaint or other initiatory pleading but shall be cause for the
dismissal of the case without prejudice, unless otherwise provided, upon motion
and after hearing. The submission of a false certification or non-compliance with
any of the undertakings therein shall constitute indirect contempt of court,
without prejudice to the corresponding administrative and criminal actions. If the
acts of the party or his counsel clearly constitute willful and deliberate forum
shopping, the same shall be ground for summary dismissal with prejudice and
shall constitute direct contempt, as well as a cause for administrative sanctions.

In Asia United Bank v. Goodland Company, Inc., this court enumerated the
instances where forum shopping takes place:

There is forum shopping "when a party repetitively avails of several judicial

remedies in different courts, simultaneously or successively, all substantially

288
founded on the same transactions and the same essential facts and circumstances,
and all raising substantially the same issues either pending in or already resolved
adversely by some other court."

The different ways by which forum shopping may be committed were

explained in Chua v. Metropolitan Bank & Trust Company:

Forum shopping can be committed in three ways: (1) filing multiple cases based
on the same cause of action and with the same prayer, the previous case not
having been resolved yet (where the ground for dismissal is litis pendentia); (2)
filing multiple cases based on the same cause of action and the same prayer, the
previous case having been finally resolved (where the ground for dismissal is res
judicata); and (3) filing multiple cases based on the same cause of action, but with
different prayers (splitting causes of action, where the ground for dismissal is also
either litis pendentia or res judicata).

In Dy v. Mandy Commodities Co, Inc., the court elaborated on the purpose

of the rule against forum shopping:

The grave evil sought to be avoided by the rule against forum shopping is the
rendition by two competent tribunals of two separate and contradictory decisions.
Unscrupulous party litigants, taking advantage of a variety of competent
tribunals, may repeatedly try their luck in several different fora until a favorable
result is reached. To avoid the resultant confusion, this Court strictly adheres to
the rules against forum shopping, and any violation of these rules results in the
dismissal of a case.

Respondent filed multiple cases based on the same cause of action and
with the same prayer. All the elements necessary for the commission of
forum shopping are present.

289
The Court of Appeals correctly held that respondent could have easily
filed a manifestation that the other petitioners had yet to verify the First
Petition. Respondent's reason that the failure of other petitioners to verify
the First Petition may imperil the issuance of a temporary restraining
order cannot justify the willful violation of the rule against forum
shopping.

Respondent must be reminded that the withdrawal of any case, when it

has been duly filed and docketed with a court, rests upon the discretion of
the court, and not at the behest of litigants. Once a case is filed before a
court and the court accepts the case, the case is considered pending and is
subject to that court's jurisdiction.

Thus, it was incumbent upon respondent to inform the court or division

where he subsequently filed his Second Petition that he had already filed
the First Petition. The Court of Appeals correctly held that courts cannot
take judicial notice of actions that have been filed either before their
courts or before other courts.

This court's Circular No. 28-91 is instructive on this point:

[I]n every petition filed with the Supreme Court or the Court of Appeals, the
petitioner . . . must certify under oath all of the following facts or undertakings:
(a) he has not theretofore commenced any other action or proceeding involving
the same issues in the Supreme Court, the Court of Appeals, or any other
tribunal or agencies; (b) to the best of his knowledge, no such action or proceeding
is pending in the Supreme Court, the Court of Appeals, or different Divisions
thereof, or any other tribunal or agency; (c) if there is such other action or
proceeding pending, he must state the status of the same; and (d) if he should
thereafter learn that a similar action or proceeding has been filed or is pending

290
before the Supreme Court, the Court of Appeals, or different Divisions thereof, or
any other tribunal or agency, he undertakes to promptly inform the aforesaid
courts and such other tribunal or agency of that fact within five (5) days
therefrom.

As a lawyer, respondent is expected to anticipate the possibility of being

held liable for forum shopping. He is expected to be aware of actions
constituting forum shopping. Respondent's defense of substantial
compliance and good faith cannot exonerate him. The elements of forum
shopping are expected to be fundamentally understood by members of
the bar, and a defense of good faith cannot counter an abject violation of
the rule.

In Alonso v. Relamida, Jr., the court elaborated on the liability of counsel

who was complicit in violating the rule on forum shopping:

The essence of forum shopping is the filing of multiple suits involving the same
parties for the same cause of action, either simultaneously or successively, for the
purpose of obtaining a favorable judgment. It exists when, as a result of an
adverse opinion in one forum, a party seeks a favorable opinion in another, or
when he institutes two or more actions or proceedings grounded on the same
cause to increase the chances of obtaining a favorable decision. An important
factor in determining its existence is the vexation caused to the courts and the
parties-litigants by the filing of similar cases to claim substantially the same
reliefs. Forum shopping exists where the elements of litis pendentia are present or
where a final judgment in one case will amount to res judicata in another. Thus,
the following requisites should concur:

... (a) identity of parties, or at least such parties as represent the same interests in
both actions, (b) identity of rights asserted and relief prayed for, the relief being
founded on the same facts, and (c) the identity of the two preceding particulars is

291
such that any judgment rendered in the other action will, regardless of which
party is successful, amount to res judicata in the action under consideration.

A lawyer owes fidelity to the cause of his client, but not at the expense of
truth and the administration of justice. The filing of multiple petitions
constitutes abuse of the court's processes and improper conduct that
tends to impede, obstruct and degrade the administration of justice and
will be punished as contempt of court. Needless to state, the lawyer who files
such multiple or repetitious petitions (which obviously delays the execution of a
final and executory judgment) subjects himself to disciplinary action for
incompetence (for not knowing any better) or for willful violation of his duties as
an attorney to act with all good fidelity to the courts, and to maintain only such
actions as appear to him to be just and are consistent with truth and honor.

292
 VIVA SHIPPING LINES, INC., Petitioner, vs. KEPPEL PHILIPPINES
MINING, INC., METROPOLITAN BANK & TRUST COMPANY,
PILIPINAS SHELL PETROLEUM CORPORATION, CITY OF
BATANGAS, CITY OF LUCENA, PROVINCE OF QUEZON,
ALEJANDRO OLIT, NIDA MONTILLA, PIO HERNANDEZ,
EUGENIO BACULO, and HARLAN BACALTOS, Respondents.

G.R. No. 177382

February 17, 2016

LEONEN, J.:

DOCTRINE:
The factual antecedents of a plea for the exercise of liberality must be clear. There
must also be a showing that the factual basis for a plea for liberality is not one
that is due to the negligence or design of the party requesting the suspension of
the rules. Likewise, the basis for claiming an equitable result—for all the
parties—must be clearly and sufficiently pleaded and argued. Courts exercise
liberality in line with their equity jurisdiction; hence, it may only be exercised if
it will result in fairness and justice.

FACTS:

On October 4, 2005, Viva Shipping Lines filed a Petition for

Corporate Rehabilitation before the RTC-Lucena City. The RTC initially
denied the Petition for failure to comply with the requirements in Rule 4,
Sections 2 and 3 of the Interim Rules of Procedure on Corporate
Rehabilitation. On October 17, 2005, Viva Shipping Lines filed an
Amended Petition.

In the Amended Petition, Viva Shipping Lines claimed to own and

operate 19 maritime vessels and Ocean Palace Mall, a shopping mall in

293
downtown Lucena City. Viva Shipping Lines also declared its total
properties’ assessed value at about ₱45,172,790.00. However, these
allegations were contrary to the attached documents in the Amended
Petition.

One of the attachments, the Property Inventory List, showed that Viva
Shipping Lines owned only two (2) maritime vessels: M/V Viva
Peñafrancia V and M/V Marian Queen. The list also stated that the fair
market value of all of Viva Shipping Lines’ assets amounted to
₱447,860,000.00, ₱400 million more than what was alleged in its Amended
Petition. Some of the properties listed in the Property Inventory List were
already marked as "encumbered" by its creditors; hence, only
₱147,630,000.00 of real property and its vessels were marked as "free
assets.

Viva Shipping Lines also declared the following debts:

According to Viva Shipping Lines, the devaluation of the Philippine peso,

increased competition, and mismanagement of its businesses made it
difficult to pay its debts as they became due. It also stated that "almost all
[its] vessels were rendered unserviceable either because of age and

294
deterioration that [it] can no longer compete with modern made vessels
owned by other operators."

In its Company Rehabilitation Plan, Viva Shipping Lines enumerated

possible sources of funding such as the sale of old vessels and commercial
lots of its sister company, Sto. Domingo Shipping Lines. It also proposed
the conversion of the Ocean Palace Mall into a hotel, the acquisition of
two (2) new vessels for shipping operations, and the "re-operation" of an
oil mill in Buenavista, Quezon.

Viva Shipping Lines nominated two individuals to be appointed as

rehabilitation receiver: Armando F. Ragudo, a businessman from
Tayabas, Quezon, and Atty. Calixto Ferdinand B. Dauz III, a lawyer from
Lucena City. A day after filing the Amended Petition, Viva Shipping
Lines submitted the name of a third nominee, Former Judge Jose F.
Mendoza.

On October 19, 2005, the RTC found that Viva Shipping Lines’ Amended
Petition to be "sufficient in form and substance," and issued a stay order.
It stayed the enforcement of all monetary and judicial claims against Viva
Shipping Lines, and prohibited Viva Shipping Lines from selling,
encumbering, transferring, or disposing of any of its properties except in
the ordinary course of business. The RTC also appointed Judge Mendoza
as rehabilitation receiver.

Before the initial hearing scheduled on December 5, 2005, the City of

Batangas, Keppel Philippines Marine, Inc., and Metrobank filed their

295
respective comments and oppositions to Viva Shipping Lines’ Amended
Petition.

Pilipinas Shell also filed its Comment/Opposition with Formal Notice of

Claim.

Luzviminda C. Cueto, a former employee of Viva Shipping Lines, also

filed a Manifestation and Registration of Monetary Claim stating that
Viva Shipping Lines owes her ₱232,000.00 as separation and 13th month
pay. The SEC filed a Comment informing the RTC that Viva Shipping
Lines violated certain laws and rules of the Commission.

On March 24, 2006, Judge Mendoza withdrew his acceptance of

appointment as rehabilitation receiver. As replacement, Viva Shipping
Lines nominated Atty. Antonio Acyatan, while Metrobank nominated
Atty. Rosario S. Bernaldo. Keppel adopted Metrobank’s nomination.

On April 4, 2006, Metrobank filed a Motion for Production or Inspection

of relevant documents relating to Viva Shipping Lines’ business
operations such as board resolutions, tax returns, accounting ledgers,
bank accounts, and contracts. Viva Shipping Lines filed its opposition.
However, the RTC granted Metrobank’s Motion. Viva Shipping Lines
failed to comply with the Order to produce the documents, as well as
with the RTC Order to submit a memorandum.

On September 27, 2006, Viva Shipping Lines’ former employees Alejandro

Olit, et al. filed their comment on the Amended Petition, informing the

296
RTC of their pending complaint against Viva Shipping Lines before the
NLRC.

In the Order dated October 30, 2006, the RTC lifted the stay order and
dismissed Viva Shipping Lines’ Amended Petition for failure to show the
company’s viability and the feasibility of rehabilitation. RTC found that
Viva Shipping Lines had P233,061,247.89 liabilities while its assets were
only P147,630,000.00

The RTC found that Viva Shipping Lines’ assets all appeared to be non-
performing. Further, it noted that Viva Shipping Lines failed to show any
evidence of consent to sell real properties belonging to its sister company.

Aggrieved, Viva Shipping Lines filed a Petition for Review under Rule 43
of the Rules of Court before the CA. It only impleaded Hon. Adolfo V.
Encomienda, the Presiding Judge of the trial court that rendered the
assailed decision. It did not implead any of its creditors, but served copies
of the Petition on counsels for Metrobank, Keppel, Pilipinas Shell, City of
Batangas, Province of Quezon, and City of Lucena. Viva Shipping Lines
neither impleaded nor served a copy of the Petition on its former
employees or their counsels.

The CA dismissed Viva Shipping Lines’ Petition for Review in the

Resolution dated January 5, 2007. It found that Viva Shipping Lines failed
to comply with procedural requirements under Rule 43. The CA ruled
that due to the failure of Viva Shipping Lines to implead its creditors as
respondents, "there are no respondents who may be required to file a
comment on the petition, pursuant to Section 8 of Rule 43."

297
Viva Shipping Lines moved for reconsideration. It argued that its
procedural misstep was cured when it served copies of the Petition on the
RTC and on its former employees. In the Resolution dated March 30, 2007,
the CA denied Viva Shipping Lines’ Motion for Reconsideration.

Viva Shipping Lines filed before this court a Petition for Review on
Certiorari assailing the January 5, 2007 and March 30, 2007 CA
Resolutions. It prayed that the case be remanded to the CA for
adjudication on the merits.

ISSUE:

Whether the Court of Appeals erred in dismissing petitioner Viva

Shipping Lines’ Petition for Review on procedural grounds

RULING: NO.

The controversy in this case arose from petitioner’s failure to comply with
appellate procedural rules in corporate rehabilitation cases. Petitioner
now pleads this court to apply the policy of liberality in constructing the
rules of procedure.

We observe that during the corporate rehabilitation proceedings, the

Regional Trial Court already exercised the liberality contemplated by the
Interim Rules of Procedure on Corporate Rehabilitation. The Regional
Trial Court initially dismissed Viva Shipping Lines’ Petition but allowed

298
the filing of an amended petition. Later on, the same court issued a stay
order when there were sufficient grounds to believe that the Amended
Petition complied with Rule 4, Section 2 of the Interim Rules of Procedure
on Corporate Rehabilitation. Petitioner was not penalized for its non-
compliance with the court’s order to produce relevant documents or for
its non-submission of a memorandum.

Even with these accommodations, the trial court still found basis to
dismiss the plea for rehabilitation.

Any final order or decision of the Regional Trial Court may be subject of
an appeal. In Re: Mode of Appeal in Cases Formerly Cognizable by the
Securities and Exchange Commission, this court clarified that all decisions
and final orders falling under the Interim Rules of Procedure on
Corporate Rehabilitation shall be appealable to the Court of Appeals
through a petition for review under Rule 43 of the Rules of Court.

New Frontier Sugar Corporation v. Regional Trial Court, Branch 39, Iloilo City
clarifies that an appeal from a final order or decision in corporate
rehabilitation proceedings may be dismissed for being filed under the
wrong mode of appeal.

New Frontier Sugar doctrinally requires compliance with the procedural

rules for appealing corporate rehabilitation decisions. It is true that Rule
1, Section 6 of the Rules of Court provides that the "[r]ules shall be
liberally construed in order to promote their objective of securing a just,
speedy and inexpensive disposition of every action and proceeding."
However, this provision does not negate the entire Rules of Court by

299
providing a license to disregard all the other provisions. Resort to liberal
construction must be rational and well-grounded, and its factual bases
must be so clear such that they outweigh the intent or purpose of an
apparent reading of the rules.

Rule 43 prescribes the mode of appeal for corporate rehabilitation cases:

Sec. 5. How appeal taken. – Appeal shall be taken by filing a verified

petition for review in seven (7) legible copies with the Court of Appeals,
with proof of service of a copy thereof on the adverse party and on the
court or agency a quo. The original copy of the petition intended for the
Court of Appeals shall be indicated as such by the petitioner.

....

Sec. 6. Contents of the petition. – The petition for review shall (a) state the
full names of the parties to the case, without impleading the court or
agencies either as petitioners or respondents; (b) contain a concise
statement of the facts and issues involved and the grounds relied upon for
the review; (c) be accompanied by a clearly legible duplicate original or a
certified true copy of the award, judgment, final order or resolution
appealed from, together with certified true copies of such material
portions of the record referred to therein and other supporting papers;
and (d) contain a sworn certification against forum shopping as provided
in the last paragraph of section 2, Rule 42. The petition shall state the
specific material dates showing that it was filed within the period fixed
herein.

Petitioner did not comply with some of these requirements. First, it did
not implead its creditors as respondents. Instead, petitioner only
impleaded the Presiding Judge of the Regional Trial Court, contrary to
Section 6(a) of Rule 43. Second, it did not serve a copy of the Petition on

300
some of its creditors, specifically, its former employees. Finally, it did not
serve a copy of the Petition on the Regional Trial Court.

Petitioner justified its failure to furnish its former employees with copies
of the Petition by stating that the former employees were late in filing
their opposition before the trial court. It also stated that its failure to
furnish the Regional Trial Court with a copy of the Petition was
unintentional.

The Court of Appeals correctly dismissed petitioner’s Rule 43 Petition as a

consequence of non-compliance with procedural rules. Rule 43, Section 7
of the Rules of Court states:

Sec. 7. Effect of failure to comply with requirements. – The failure of the

petitioner to comply with any of the foregoing requirements regarding the
payment of the docket and other lawful fees, the deposit of costs, proof of service of
the petition, and the contents of and the documents which should accompany the
petition shall be sufficient ground for the dismissal thereof.

Petitioner admitted its failure to comply with the rules. It begs the
indulgence of the court to give due course to its Petition based on their
belated compliance with some of these procedural rules and the policy on
the liberal construction of procedural rules.

There are two kinds of "liberality" with respect to the construction of

provisions of law. The first requires ambiguity in the text of the provision
and usually pertains to a situation where there can be two or more viable
meanings given the factual context presented by a case. Liberality here

301
means a presumption or predilection to interpret the text in favor of the
cause of the party requesting for "liberality."

Then there is the "liberality" that actually means a request for the
suspension of the operation of a provision of law, whether substantive or
procedural. This liberality requires equity. There may be some rights that
are not recognized in law, and if courts refuse to recognize these rights, an
unfair situation may arise. Specifically, the case may be a situation that
was not contemplated on or was not possible at the time the legal norm
was drafted or promulgated.

It is in the second sense that petitioner pleads this court.

Our courts are not only courts of law, but are also courts of equity. Equity
is justice outside legal provisions, and must be exercised in the absence of
law, not against it. In Reyes v. Lim: Equity jurisdiction aims to do complete
justice in cases where a court of law is unable to adapt its judgments to
the special circumstances of a case because of the inflexibility of its
statutory or legal jurisdiction. Equity is the principle by which substantial
justice may be attained in cases where the prescribed or customary forms
of ordinary law are inadequate.

Liberality lies within the bounded discretion of a court to allow an

equitable result when the proven circumstances require it. Liberality
acknowledges a lacuna in the text of a provision of law. This may be
because those who promulgated the rule may not have foreseen the
unique circumstances of a case at bar. Human foresight as laws and rules
are prepared is powerful, but not perfect.

302
Liberality is not an end in itself. Otherwise, it becomes a backdoor
disguising the arbitrariness or despotism of judges and justices. In North
Bulacan Corp. v. PBCom, the Regional Trial Court ignored several
procedural rules violated by the petitioning corporation and allowed
rehabilitation in the guise of liberality. This court found that the Regional
Trial Court grossly abused its authority when it allowed rehabilitation
despite the corporation’s blatant noncompliance with the rules.

The factual antecedents of a plea for the exercise of liberality must be

clear. There must also be a showing that the factual basis for a plea for
liberality is not one that is due to the negligence or design of the party
requesting the suspension of the rules. Likewise, the basis for claiming an
equitable result—for all the parties—must be clearly and sufficiently
pleaded and argued. Courts exercise liberality in line with their equity
jurisdiction; hence, it may only be exercised if it will result in fairness and
justice.

The first rule breached by petitioner is the failure to implead all the
indispensable parties. Petitioner did not even interpose reasons why it
should be excused from compliance with the rule to "state the full names
of the parties to the case, without impleading the court . . . as . . .
respondents." Petitioner did exactly the opposite. It failed to state the full
names of its creditors as respondents. Instead, it impleaded the Presiding
Judge of the originating court.

The Rules of Court requires petitioner to implead respondents as a matter

of due process. Under the Constitution, " [n]o person shall be deprived of
life, liberty or property without due process of the law." An appeal to a
corporate rehabilitation case may deprive creditor-stakeholders of

303
property. Due process dictates that these creditors be impleaded to give
them an opportunity to protect the property owed to them.

Creditors are indispensable parties to a rehabilitation case, even if a

rehabilitation case is non-adversarial. In Boston Equity Resources, Inc. v.
Court of Appeals: An indispensable party is one who has such an interest in
the controversy or subject matter of a case that a final adjudication cannot
be made in his or her absence, without injuring or affecting that interest.
He or she is a party who has not only an interest in the subject matter of
the controversy, but "an interest of such nature that a final decree cannot
be made without affecting [that] interest or leaving the controversy in
such a condition that its final determination may be wholly inconsistent
with equity and good conscience. It has also been considered that an
indispensable party is a person in whose absence there cannot be a
determination between the parties already before the court which is
effective, complete or equitable." Further, an indispensable party is one
who must be included in an action before it may properly proceed.

A corporate rehabilitation case cannot be decided without the creditors’

participation. The court’s role is to balance the interests of the corporation,
the creditors, and the general public. Impleading creditors as respondents
on appeal will give them the opportunity to present their legal arguments
before the appellate court. The courts will not be able to balance these
interests if the creditors are not parties to a case. Ruling on petitioner’s
appeal in the absence of its creditors will not result in judgment that is
effective, complete, and equitable.

This court cannot exercise its equity jurisdiction and allow petitioner to
circumvent the requirement to implead its creditors as respondents.

304
Tolerance of such failure will not only be unfair to the creditors, it is
contrary to the goals of corporate rehabilitation, and will invalidate the
cardinal principle of due process of law.

The failure of petitioner to implead its creditors as respondents cannot be

cured by serving copies of the Petition on its creditors. Since the creditors
were not impleaded as respondents, the copy of the Petition only serves
to inform them that a petition has been filed before the appellate court.
Their participation was still significantly truncated.

Petitioner’s failure to implead them deprived them of a fair hearing. The

appellate court only serves court orders and processes on parties formally
named and identified by the petitioner. Since the creditors were not
named as respondents, they could not receive court orders prompting
them to file remedies to protect their property rights.

The next procedural rule that petitioner pleaded to suspend is the rule
requiring it to furnish all parties with copies of the Rule 43 Petition.
Petitioner admitted its failure to furnish its former employees with copies
of the Petition because they belatedly filed their claims before the
Regional Trial Court.

This argument is specious at best; at worst, it foists a fraud on this court.

The former employees were unable to raise their claims on time because
petitioner did not declare them as creditors. The Amended Petition did
not contain any information regarding pending litigation between
petitioner and its former employees. The only way the former employees
could become aware of the corporate rehabilitation proceedings was

305
either through the required publication or through news informally
circulated among their colleagues. Clearly, it was petitioner who caused
the belated filing of its former employees’ claims when it failed to notify
its employees of the corporate rehabilitation proceedings. Petitioner’s
failure was conveniently and disreputably hidden from this court.

Former employee Luzviminda C. Cueto filed her Manifestation and

Registration of Monetary Claim as early as November 25, 2005. Alejandro
Olit, et al., the other employees, filed their Comment on September 27,
2006. By the time petitioner filed its Petition for Review dated November
21, 2006 before the Court of Appeals, it was well aware that these
individuals had expressed their interest in the corporate rehabilitation
proceedings. Petitioner and its counsel had no excuse to exclude these
former employees as respondents on appeal.

Petitioner’s belated compliance with the requirement to serve the Petition

for Review on its former employees did not cure the procedural lapse.
There were two sets of employees with claims against petitioner:
Luzviminda C. Cueto and Alejandro Olit, et al. When the Court of
Appeals dismissed petitioner’s appeal, petitioner only served a copy on
Alejandro Olit, et al. Petitioner still did not serve a copy on Luzviminda
C. Cueto.

We do not see how it will be in the interest of justice to allow a petition

that fails to inform some of its creditors that the final order of the
corporate rehabilitation proceeding was appealed. By not declaring its
former employees as creditors in the Amended Petition for Corporate
Rehabilitation and by not notifying the same employees that an appeal
had been filed, petitioner consistently denied the due process rights of
these employees.

306
This court cannot be a party to the inequitable way that petitioner’s
employees were treated.

Petitioner also pleaded to be excused from the requirement under Rule 6,

Section 5 of the Rules of Court to serve a copy of the Petition on the
originating court. According to petitioner, the annexes for the Petition for
Review filed before the Court of Appeals arrived from Lucena City on the
last day of filing the petition. Petitioner’s representative from Lucena City
and petitioner’s counsel rushed to compile and reproduce all the
documents, and in such rush, failed to send a copy to the Regional Trial
Court. When petitioner realized that it failed to furnish the originating
court with a copy of the Petition, a copy was immediately sent by
registered mail.

Again, petitioner’s excuse is unacceptable. Petitioner had 15 days to file a

Rule 43 petition, which should include the proof of service to the
originating court. Rushing the compilation of the pleading with the
annexes has nothing to do with being able to comply with the
requirement to submit a proof of service of the copy of the petition for
review to the originating court. If at all, it further reflects the
unprofessional way that petitioner and its counsel treated our rules.

As this court has consistently ruled, "[t]he right to appeal is not a natural
right[,] nor a part of due process; it is merely a statutory privilege, and
may be exercised only in the manner and in accordance with the
provisions of the law."

307
In line with this, liberality in corporate rehabilitation procedure only
generally refers to the trial court, not to the proceedings before the
appellate court. The Interim Rules of Procedure on Corporate
Rehabilitation covers petitions for rehabilitation filed before the Regional
Trial Court. Thus, Rule 2, Section 2 of the Interim Rules of Procedure on
Corporate Rehabilitation, which refers to liberal construction, is limited to
the Regional Trial Court. The liberality was given "to assist the parties in
obtaining a just, expeditious, and inexpensive disposition of the case."

The party who seeks to avail [itself] of [an appeal] must comply with the
requirements of the rules. Failing to do so, the right to appeal is lost. Rules
of procedure are required to be followed, except only when for the most
persuasive of reasons, they may be relaxed to relieve a litigant of an
injustice not commensurate with the degree of his thoughtlessness in not
complying with the procedure prescribed.

Petitioner’s excuses do not trigger the application of the policy of

liberality in construing procedural rules. For the courts to exercise
liberality, petitioner must show that it is suffering from an injustice not
commensurate to the thoughtlessness of its procedural mistakes. Not only
did petitioner exercise injustice towards its creditors, its Rule 43 Petition
for Review did not show that the Regional Trial Court erred in dismissing
its Amended Petition for Corporate Rehabilitation.

308
 BAGUMBAYAN-VNP MOVEMENT, INC., AND RICHARD J.
GORDON, AS CHAIRMAN OF BAGUMBAYAN-VNP MOVEMENT,
INC., Petitioners ELECTIONS, Respondent.

G.R. No. 222731

March 08, 2016

LEONEN, J.:

DOCTRINE:
A petition for mandamus may be granted and a writ issued when an agency
"unlawfully neglects the performance of an act which the law specifically enjoins
as from an office."

FACTS:

Petitioners Bagumbayan-VNP, Inc. and Former Senator Richard J.

Gordon filed this Petition for mandamus before this court to compel

309
respondent COMELEC to implement the Voter Verified Paper Audit Trail
security feature.

On December 22, 1997, RA 8436 authorized the COMELEC to use an

automated election system for electoral exercises. After almost a decade,
RA 9369 amended RA 8436. RA 9369 introduced significant changes to
RA 8436, BP 881, otherwise known as the Omnibus Election Code, and
other election-related statutes.

Automation is hailed as a key "towards clean and credible elections,"

reducing the long wait and discouraging cheating. In 2010 and 2013, the
COMELEC enforced a nationwide automated election system using the
Precinct Count Optical Scan (PCOS) machines. For the 2016 National and
Local Elections, the COMELEC has opted to use the Vote-Counting
Machine. The vote-counting machine is a "paper-based automated
election system," which is reported to be "seven times faster and more
powerful than the PCOS because of its updated processor." Likewise, it is
reported to have more memory and security features, and is "capable of
producing the Voter Verification Paper Audit Trail (VVPAT)." This
VVPAT functionality is in the form of a printed receipt and a touch screen
reflecting the votes in the vote-counting machine.

Petitioners allege that under RA 8436, as amended by RA 9369, there are

several safeguards or Minimum System Capabilities to ensure the sanctity
of the ballot. Among these is the implementation of the VVPAT security
feature, as found in Section 6(e), (f), and (n).

310
Petitioners claim that VVPAT "consists of physical paper records of voter
ballots as voters have cast them on an electronic voting system." Through
it, the voter can verify if the choices on the paper record match the choices
that he or she actually made in the ballot. The voter can confirm whether
the machine had actually read the ballot correctly. Petitioners seek to
compel the Commission on Elections to have the vote-counting machine
issue receipts once a person has voted.

According to petitioners, the VVPAT "will ensure transparency and

reduce any attempt to alter the results of the elections." There will be "an
electronic tally of the votes cast" or the vote stored in the vote-counting
machine, as well as "a paper record of the individual votes" cast or the
VVPAT receipt. Should there be any doubt, "the electronically generated
results . . . can then be audited and verified through a comparison . . .
with these paper records."

In the Terms of Reference for the 2016 National and Local Elections
Automation Project, the COMELEC lists the Minimum Technical
Specifications of the Optical Mark Reader or Optical Scan System,
precinct-based technologies that the poll body shall accept.

Petitioners claim that the COMELEC refuses to implement the VVPAT

function based on fears that the security feature may aid in vote-buying,
and that the voting period may take longer.

On November 10, 2015, Bagumbayan-VNP, Inc. sent COMELEC

Chairperson Bautista a letter demanding the implementation of the

311
VVPAT feature for the May 9, 2016 Elections. However, the COMELEC
never answered the letter.

Petitioners claim that under Section 28 of Republic Act No. 9369,

amending Section 35 of Republic Act No. 8436, anyone "interfering with
and impeding . . . the use of computer counting devices and the
processing, storage, generation and transmission of election results, data
or information" commits a felonious act. The COMELEC allegedly did so
when it refused to implement VVPAT.

In view of the foregoing, petitioners filed a Special Civil Action for

Mandamus under Rule 65, Section 3 of the Rules of Court. They ask this
court to compel the COMELEC to comply with the provisions of Section
6(e), (f), and (n) of Republic Act No. 8436, as amended.

ISSUE:

Whether the Commission on Elections may be compelled, through a writ

of mandamus, to enable the Voter Verified Paper Audit Trail system
capability feature for the 2016 Elections

RULING: YES.

Mandamus is the relief sought "[w]hen any tribunal corporation, board,

officer or person unlawfully neglects the performance of an act which the
law specifically enjoins as a duty resulting from an office, trust, or
station," and "there is no other plain, speedy and adequate remedy in the
ordinary course of law."

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Through a writ of mandamus, the courts "compel the performance of a
clear legal duty or a ministerial duty imposed by law upon the defendant
or respondent" by operation of his or her office, trust, or station. The
petitioner must show the legal basis for the duty, and that the defendant
or respondent failed to perform the duty.

Petitioners argue that the Commission on Elections unlawfully neglected

to perform its legal duty of fully implementing our election laws,
specifically Republic Act No. 8436, Section 6(e), (f), and (n), as amended
by Republic Act No. 9369:

SEC. 6. Minimum System Capabilities. — The automated election system must

at least have the following functional capabilities:

....

(e) Provision for voter verified paper audit trail;

(f) System auditability which provides supporting documentation for verifying

the correctness of reported election results;

....

(n) Provide the voter a system of verification to find out whether or not the
machine has registered his choice;

Commission on Elections Resolution No. 10057 promulgated on February

11, 2016 did not include mechanisms for VVPAT. Under Part III of the
Resolution, it merely stated:

SEC. 40. Manner of voting. -

a. The voter shall:

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1. Using a ballot secrecy folder and the marking pen provided by the
Commission, fill his/her ballot by fully shading the circle beside the
names of the candidates and the party, organization or coalition
participating in the party-list system of representation, of his/her choice;
and

2. After accomplishing his/her ballot, approach the VCM, insert his/her

ballot in the ballot entry slot;

i. The VCM will display "PROCESSING.../PAKIHINTAY...

KASALUKUYANG PINOPROSESO";

ii. The ballot shall automatically be dropped inside the ballot box. The
VCM will then display the message "YOUR VOTE HAS BEEN
CAST/ANG IYONG BOTO AY NAISAMANA."

iii. The VCM will display the message "AMBIGUOUS MARK

DETECTED" if the ovals are not properly shaded or an unintentional
mark is made. It will display the message "AMBIGUOUS MARKS
DETECTED/MAY MALABONG MARKA SA BALOTA." The following
options shall be provided "TO CAST BALLOT PRESS/PARA IPASOK
ANG BALOTA, PINDUTIN" or "TO RETURN BALLOT, PRESS/PARA
IBALIK ANG BALOTA, PINDUTIN." Press the "TO RETURN BALLOT,
PRESS/PARA IBALIK ANG BALOTA, PINDUTIN" to return the ballot to
the voter. Let the voter review the ballot and ensure that the ovals
opposite the names of the candidate voted for are fully shaded.

iv. In case of illiterate voters, PWD voters who are visually-impaired, and
senior citizens (SCs) who may need the use of headphones, the BEI shall
insert the headphones so they can follow the instructions of the VCM.

b. The poll clerk/support staff shall:

1. Monitor, from afar, the VCM screen to ensure that the ballot was
successfully accepted;

314
2. Thereafter, whether or not the voter's ballot was successfully accepted,
apply indelible ink to the voter's right forefinger nail or any other nail if
there be no forefinger nail; and

3. Instruct the voter to return the ballot secrecy folder and marking pen,
and then leave the polling place.

In a press conference last March 4, 2016, Commission on Elections

Chairperson Andres Bautista manifested that the Commission on
Elections decided "to err on the side of transparency" and resolved to
allow voters to have 15-second on-screen verification of the votes they
have casted through the vote-counting machine. Allowing on-screen
verification is estimated to add two (2) hours to the voting period on May
9, 2016. As reported, the meeting of the Commission on Elections En Banc
to pass this Resolution was on March 3, 2016, three (3) days after they
were required to file a comment before this court.

Nonetheless, the inaction of the Commission on Elections in utilizing the

VVPAT feature of the vote-counting machines fails to fulfill the duty
required under Republic Act No. 8436, as amended.

Article XI(C), Section 2 of the 1987 Constitution empowered the

Commission of Elections to "[e]nforce and administer all laws and
regulations relative to the conduct of an election." One of the laws that the
Commission on Elections must implement is Republic Act No. 8436, as
amended by Republic Act No. 9369, which requires the automated
election system to have the capability of providing a voter-verified paper
audit trail.

315
Based on the technical specifications during the bidding, the current vote-
counting machines should meet the minimum system capability of
generating a VVPAT. However, the Commission on Elections' act of
rendering inoperative this feature runs contrary to why the law required
this feature in the first place. Under Republic Act No. 8436, as amended, it
is considered a policy of the state that the votes reflect the genuine will of
the People. The full text of the declaration of policy behind the law
authorizing the use of an automated election system states:

SECTION 1. Declaration of Policy. — It is the policy of the State to ensure free,

orderly, honest, peaceful, credible and informed elections, plebiscites, referenda,
recall and other similar electoral exercises by improving on the election process
and adopting systems, which shall involve the use of an automated election
system that will ensure the secrecy and sanctity of the ballot and all election,
consolidation and transmission documents in order that the process shall be
transparent and credible and that the results shall be fast, accurate and reflective
of the genuine will of the people.

The State recognizes the mandate and authority of the Commission to

prescribe the adoption and use of the most suitable technology of
demonstrated capability taking into account the situation prevailing in
the area and the funds available for the purpose.

By setting the minimum system capabilities of our automated election

system, the law intends to achieve the purposes set out in this declaration.
A mechanism that allows the voter to verify his or her choice of
candidates will ensure a free, orderly, honest, peaceful, credible, and
informed election. The voter is not left to wonder if the machine correctly
appreciated his or her ballot. The voter must know that his or her
sovereign will, with respect to the national and local leadership, was
properly recorded by the vote-counting machines.

316
The minimum functional capabilities enumerated under Section 6 of
Republic Act 8436, as amended, are mandatory. These functions
constitute the most basic safeguards to ensure the transparency,
credibility, fairness and accuracy of the upcoming elections.

The law is clear. A "voter verified paper audit trail" requires the
following: (a) individual voters can verify whether the machines have
been able to count their votes; and (b) that the verification at minimum
should be paper based.

There appears to be no room for further interpretation of a "voter verified

paper audit trail." The paper audit trail cannot be considered the physical
ballot, because there may be instances where the machine may translate
the ballot differently, or the voter inadvertently spoils his or her ballot.

In Maliksi v. Commission on Elections, the losing mayoralty candidate

questioned the result of the elections. Upon inspection of the physical
ballots, several votes were invalidated due to the presence of double-
shading. However, when the digital printouts of the ballots were checked,
the questioned ballots only had single shade. The physical ballots were
tampered to invalidate several votes.

The situation in Maliksi could have been avoided if the Commission on

Elections utilized the paper audit trail feature of the voting machines. The
VVPAT ensures that the candidates selected by the voter in his or her
ballot are the candidates voted upon and recorded by the vote-counting
machine. The voter himself or herself verifies the accuracy of the vote. In

317
instances of Random Manual Audit and election protests, the VVPAT
becomes the best source of raw data for votes.

The required system capabilities under Republic Act No. 8436, as

amended, are the minimum safeguards provided by law. Compliance
with the minimum system capabilities entails costs on the state and its
taxpayers. If minimum system capabilities are met but not utilized, these
will be a waste of resources and an affront to the citizens who paid for
these capabilities.

It is true that the Commission on Elections is given ample discretion to

administer the elections, but certainly, its constitutional duty is to "enforce
the law." The Commission is not given the constitutional competence to
amend or modify the law it is sworn to uphold. Section 6(e), (f), and (n) of
Republic Act No. 8436, as amended, is law. Should there be policy
objections to it, the remedy is to have Congress amend it.

The Commission on Elections cannot opt to breach the requirements of

the law to assuage its fears regarding the VVPAT. Vote-buying can be
averted by placing proper procedures. The Commission on Elections has
the power to choose the appropriate procedure in order to enforce the
VVPAT requirement under the law, and balance it with the constitutional
mandate to secure the secrecy and sanctity of the ballot.

We see no reason why voters should be denied the opportunity to read

the voter's receipt after casting his or her ballot. There is no legal
prohibition for the Commission on Elections to require that after the voter
reads and verifies the receipt, he or she is to leave it in a separate box, not

318
take it out of the precinct. Definitely, the availability of all the voters'
receipts will make random manual audits more accurate.

The credibility of the results of any election depends, to a large extent, on

the confidence of each voter that his or her individual choices have
actually been counted. It is in that local precinct after the voter casts his or
her ballot that this confidence starts. It is there where it will be possible
for the voter to believe that his or her participation as sovereign truly
counts.

319
 DATU GUIMID P. MATALAM, Petitioner, v. PEOPLE OF THE
PHILIPPINES, Respondent

G.R. Nos. 221849-50

April 04, 2016

LEONEN, J.:

DOCTRINE:
It is settled that factual findings of the trial court are entitled to respect and
finality unless it is shown that such findings are patently misplaced or without
any basis.

FACTS:

The Office of the Ombudsman charged Matalam, Regional Secretary

of the DAR-ARMM, with the commission of crimes under "Section 52 (g)
of RA 8921, otherwise known as the GSIS Act of 1997, and Section 1, Rule
XIII of the IRR of RA 7742".

On August 11, 2003, Matalam was arraigned and he pleaded not

guilty.On October 20, 2004, Matalam's co-accused, Ansarry Lawi and
Naimah B. Unte, were arraigned and they separately pleaded not guilty.

According to the Prosecution, Matalam, Lawi, and Unte were the officers
involved in the collection and remittance of accounts to the GSIS and Pag-
IBIG Fund and, thus, were accountable for the non-remittance. Matalam
and his co-accused failed and/or refused to remit the required
contributions without justifiable cause despite repeated demands.

320
In the Joint Decision dated April 28, 2015, the Sandiganbayan found
Matalam guilty of the crimes charged.

Matalam filed a Motion for Reconsideration of the Decision, which was

denied by the Sandiganbayan on November 2, 2015.

Matalam now comes before the Supreme Court and assails the
Sandiganbayan Decision.

Matalam argues that a review of the factual findings of the

Sandiganbayan would reveal that there is reasonable doubt that he
committed the crimes imputed to him. Testimonies of the witnesses
showed that the funds for the remittances due to GSIS and Pag-IBIG Fund
were released to the Office of the Regional Governor of the ARMM and
not to DAR-ARMM. Even if the funds were, indeed, released to DAR-
ARMM, "Matalam as the Regional Secretary could not be held
accountable for the non-payment or remittance, since as a matter of
procedure, he merely acts as a signatory to whatever document is
necessary for the payment of the employer's share to both GSIS and Pag-
IBIG [Fund]." It is the Office of the Regional Governor that has the duty to
release the funds.

Matalam also assails the testimony of witness Abdulkadil Alabat for

being incomplete. According to Matalam, not all of the bank statements
allegedly related to ARMM's account with the Land Bank of the
Philippines, Cotabato Branch, was presented in court. Moreover, based on
witnesses' testimonies, the Notices of Cash Allocation were addressed to
the Office of the Regional Governor of the ARMM, not to DAR-ARMM.

321
Furthermore, Matalam argues that even if the offenses he allegedly
committed are mala prohibita, his guilt must still be proven beyond
reasonable doubt. The pieces of evidence presented in this case create a
reasonable doubt as to his guilt. Thus, a re-evaluation of the evidence is
required.

ISSUE:

Whether petitioner Datu Guimid P. Matalam is guilty beyond reasonable

doubt of non-remittance of the employer's share of the GSIS and Pag-IBIG
Fund premiums as proven by the evidence presented by the prosecution

RULING: YES.

Petitioner failed to show that the Sandiganbayan committed reversible

error in rendering the assailed Decision and Resolution. Petitioner is liable
for the non-remittance of the contributions to GSIS and Pag-IBIG Fund.

Petitioner's liability for the non-remittance to GSIS and Pag-IBIG Fund of

the employer's share in the contributions is clearly set out in the laws
mandating the collection and remittance of the premiums:

In both cases, petitioner was informed of the underpayment or non-

remittance of premiums for a period of one (1) year and six (6) months, or
from January 1997 to June 1998. Petitioner failed to heed the letters and

322
billing statements, which asked him, as head of DAR-ARMM, to pay the
deficiencies.

We cannot accept petitioner's argument that the duty to remit the

required amounts falls to his co-accused.

Republic Act No. 8291, Section 52(g) clearly provides that heads of
agencies or branches of government shall be criminally liable for the
failure, refusal, or delay in the payment, turnover, and remittance or
delivery of such accounts to the GSIS.

Similarly, the refusal or failure without lawful cause or with fraudulent

intent to comply with the provisions of Republic Act No. 7742, with
respect to the collection and remittance of employee savings as well as the
required employer contributions to the Pag-IBIG Fund, subjects the
employer to criminal liabilities such as the payment of a fine,
imprisonment, or both.

Indeed, non-remittance of GSIS and Pag-IBIG Fund premiums is

criminally punishable.

As the Sandiganbayan found from the testimonies of the witnesses and

evidence on record, the amounts meant for remittance to GSIS and Pag-
IBIG Fund were indeed deposited into the bank account maintained by
DARARMM for its Fund 101. It is settled that factual findings of the trial
court are entitled to respect and finality unless it is shown that such
findings are patently misplaced or without any basis. Hence, petitioner's
duty to ensure the remittance of the amounts to GSIS and Pag-IBIG Fund
was triggered by the availability of the funds in DAR-ARMM's account.

323
324
 JOSEPH SCOTT PEMBERTON, Petitioner, v. HON. LEILA M. DE
LIMA, IN HER CAPACITY AS THE SECRETARY OF JUSTICE,
JUDGE ROLINE GINEZ- JABALDE, IN HER CAPACITY AS
PRESIDING JUDGE OF BRANCH 74 OF THE REGIONAL TRIAL
COURT OF OLONGAPO CITY, AND MARILOU LAUDE Y
SERDONCILLO, Respondents.

G.R. No. 217508

April 18, 2016

LEONEN, J.:

DOCTRINE:
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 therefore. 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.

A petition for certiorari questioning the validity of the preliminary investigation

in any other venue is rendered moot by the issuance of a warrant of arrest and the
conduct of arraignment.

325
FACTS:

A complaint for murder was filed by the PNP-Olongapo City Police

Office and private respondent Marilou Laude y Serdoncillo against
petitioner Joseph Scott Pemberton.

On October 17, 2014, Pemberton received a Subpoena issued by the City

Prosecutor of Olongapo City giving him 10 days from receipt within
which to file a counter-affidavit. Laude filed an Omnibus Motion dated
October 21, 2014 praying that the City Prosecutor of Olongapo City issue
subpoenas addressed to: (a) "Pemberton, directing him to present himself
for the lifting of his fingerprint and of buccal swabs during the
clarificatory hearing set on [November 5,] 2014;" and (b) the PNP Crime
Laboratory, directing the Chief of Office to assign forensic personnel to
gather fingerprints and buccal swabs from Pemberton and subject him to
"forensic examination and analysis, including DNA testing." Pemberton
opposed this in his Opposition to the Omnibus Motion dated 21 October
2014 dated October 27, 2014. He also filed a Manifestation and Omnibus
Motion: (1) For Clarification; (2) To Declare Absence of Probable Cause
for Murder or Any Other Crime Against [Petitioner]; and (3) By Way of
Ad Cautela [sic] Prayer, in the Event that this Honorable Office does not
Declare the Absence of Probable Cause, at the very least, To Reduce the
Charge to Homicide Considering the Lack of Circumstances Qualifying
the Offense to Murder dated October 27, 2014.

In the Order dated October 29, 2014, the City Prosecutor directed the PNP
Crime Laboratory to obtain latent fingerprint and buccal swabs from
Pemberton and "to submit . . . the results of the forensic examination
within a period of three (3) weeks . . . from the date of actual collection of
the specimen[s.]"

326
Pemberton filed a Manifestation with Omnibus Motion: 1) to Determine
Probable Cause on the Basis of Evidence Submitted as of 27 October 2014;
and 2) For Reconsideration of the Order dated 29 October 2014 dated
November 4, 2014.

However, the City Prosecutor of Olongapo City continued to evaluate the

evidence and conducted ocular inspections in connection with the
preliminary investigation. Through the Resolution dated December 15,
2014, it "found probable cause against [Pemberton] for the crime of
murder." On the same day, an Information for murder was filed against
Pemberton before the RTC of Olongapo City. The trial court issued a
warrant of arrest.

On December 18, 2014, Pemberton filed his Petition for Review before the
DOJ. On the same day, he filed a Motion to Defer the Proceedings before
the RTC.

In the Resolution dated January 27, 2015, Secretary De Lima denied

Pemberton's Petition for Review and stated that based on the evidence on
record, there was "no reason to alter, modify, or reverse the resolution of
the City Prosecutor of Olongapo City." Pemberton's Motion for
Reconsideration was likewise denied for lack of merit in the Resolution
dated February 20, 2015.

Aggrieved, Pemberton filed this Petition for Certiorari with application

for the ex-parte issuance of a temporary restraining order and/or writ of
preliminary injunction.

327
Pemberton argues that in sustaining a finding of probable cause, Secretary
De Lima committed grave abuse of discretion amounting to excess or
absence of jurisdiction based on the following grounds: (a) Secretary De
Lima took into account additional evidence which the City Prosecutor
allegedly had no authority to receive and which Pemberton had no
opportunity to address and rebut, thereby denying him due process of
law; (b) Secretary De Lima found probable cause to charge Pemberton
with the crime of murder when "the evidence on record does not support
the existence of probable cause to indict [him] . . . with either homicide or
murder[;]" and (c) Secretary De Lima found that "the killing was attended
with the qualifying circumstances of treachery, abuse of superior
strength[,] and cruelty despite prevailing jurisprudence dictating that the
elements of these qualifying circumstances . . . be established by direct
evidence."

Secretary De Lima, through the OSG, points out that this Petition is
procedurally infirm. The Petition assails the appreciation of evidence and
law by Secretary De Lima, which are "errors of judgment . . . [that] cannot
be remedied by a writ of certiorari." Further, by filing this Petition before
this court and not the CA, Pemberton violated the principle of hierarchy
of courts. Moreover, the case is moot and academic, considering that the
RTC has convicted Pemberton for the crime charged.

ISSUES:

(1) Whether respondent Secretary Leila M. De Lima committed grave

abuse of discretion in sustaining the finding of probable cause against
petitioner Joseph Scott Pemberton, thereby denying petitioner due
process of law

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(2) Whether petitioner violated the principle of hierarchy of courts by
filing his Petition before this Court instead of the Court of Appeals

(3) Whether the case has been rendered moot and academic

RULING:

(1) NO.

In Alafriz v. Nable, this Court defined grave abuse of discretion:

Certiorari lies where a court has acted without or in excess of jurisdiction or with
grave abuse of discretion.

"Without jurisdiction" means that the court acted with absolute want of
jurisdiction. There is "excess of jurisdiction" where the court has jurisdiction but
has transcended the same or acted without any statutory authority. "Grave abuse
of discretion" implies such capricious and whimsical exercise of judgment as is
equivalent to lack of jurisdiction, or, in other words, where the power is exercised
in an arbitrary or despotic manner by reason of passion or personal hostility, and
it must be so patent and gross as to amount to an evasion of positive duty or to a
virtual refusal to perform the duty enjoined or to act at all in contemplation of
law.

In Ching v. Secretary of Justice, this Court expounded on the evidence

required for a determination of probable cause:

Probable cause need not be based on clear and convincing evidence of guilt, as the
investigating officer acts upon probable cause of reasonable belief. Probable cause

329
implies probability of guilt and requires more than bare suspicion but less than
evidence which would justify a conviction. A finding of probable cause needs only
to rest on evidence showing that more likely than not, a crime has been committed
by the suspect.

This was reiterated in Chan v. Secretary of Justice:

Probable cause has been defined as the existence of such facts and circumstances
as would lead a person of ordinary caution and prudence to entertain an honest
and strong suspicion that the person charged is guilty of the crime subject of the
investigation. Being based merely on opinion and reasonable belief, it does not
import absolute certainty. Probable cause need not be based on clear and
convincing evidence of guilt, as the investigating officer acts upon reasonable
belief. Probable cause implies probability of guilt and requires more than bare
suspicion but less than evidence which would justify a conviction.

There is no basis to doubt that respondent De Lima judiciously

scrutinized the evidence on record. Based on respondent De Lima's
assessment, there was ample evidence submitted to establish probable
cause that petitioner murdered the victim:

First, the killing of Laude has been indubitably confirmed.

Second, the various pieces of evidence so far presented in this case, i.e., the
CCTV footage of Ambyanz showing Gelviro, Laude and respondent
leaving the club together; the unequivocal testimonies of Gelviro and
Gallamos positively identifying respondent as the person who was last
seen with Laude on the night he died; the result of the general physical
examination conducted on respondent showing abrasions and light
scratches on different parts of his body; his latent print on one of the
condoms found at the crime scene; and the unequivocal testimonies of
respondent's fellow Marine servicemen who were with him on that fateful

330
night, lead to no other conclusion than that respondent was the
perpetrator of the crime.

Third, the results of the physical examination conducted on respondent

and Laude's cadaver, as well as the ocular inspection of the crime scene,
demonstrate the attendant qualifying circumstances of treachery, abuse of
superior strength, and cruelty.

Finally, the killing is neither parricide nor infanticide as provided under

the RPC, as amended. Hence, the charge of murder.

The convergence of the foregoing circumstances all taken together leads

to the fair and reasonable inference that respondent is probably guilty of
killing Laude through treachery, abuse of superior strength, and cruelty.

(2) NO.

In Bañez, Jr. v. Concepcion, we explained the necessity of the application of

the hierarchy of courts:

The Court must enjoin the observance of the policy on the hierarchy of
courts, and now affirms that the policy is not to be ignored without
serious consequences. The strictness of the policy is designed to shield the
Court from having to deal with causes that are also well within the
competence of the lower courts, and thus leave time to the Court to deal
with the more fundamental and more essential tasks that the Constitution
has assigned to it. The Court may act on petitions for the extraordinary
writs of certiorari, prohibition and mandamus only when absolutely
necessary or when serious and important reasons exist to justify an
exception to the policy.

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In Bañez, we also elaborated on the reasons why lower courts are allowed
to issue writs of certiorari, prohibition, and mandamus, citing Vergara v.
Suelto:

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 therefore. 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.

The doctrine that requires respect for the hierarchy of courts was created
by this court to ensure that every level of the judiciary performs its
designated roles in an effective and efficient manner. Trial courts do not
only determine the facts from the evaluation of the evidence presented
before them. They are likewise competent to determine issues of law
which may include the validity of an ordinance, statute, or even an
executive issuance in relation to the Constitution. To effectively perform
these functions, they are territorially organized into regions and then into
branches. Their writs generally reach within those territorial boundaries.
Necessarily, they mostly perform the all-important task of inferring the

332
facts from the evidence as these are physically presented before them. In
many instances, the facts occur within their territorial jurisdiction, which
properly present the 'actual case' that makes ripe a determination of the
constitutionality of such action. The consequences, of course, would be
national in scope. There are, however, some cases where resort to courts
at their level would not be practical considering their decisions could still
be appealed before the higher courts, such as the Court of Appeals.

The Court of Appeals is primarily designed as an appellate court that

reviews the determination of facts and law made by the trial courts. It is
collegiate in nature. This nature ensures more standpoints in the review of
the actions of the trial court. But the Court of Appeals also has original
jurisdiction over most special civil actions. Unlike the trial courts, its writs
can have a nationwide scope. It is competent to determine facts and,
ideally, should act on constitutional issues that may not necessarily be
novel unless there are factual questions to determine.

This court, on the other hand, leads the judiciary by breaking new ground
or further reiterating — in the light of new circumstances or in the light of
some confusions of bench or bar — existing precedents. Rather than a
court of first instance or as a repetition of the actions of the Court of
Appeals, this court promulgates these doctrinal devices in order that it
truly performs that role.

We proceeded to name exceptional cases, where direct resort to this Court

may be allowed:

First, a direct resort to this court is allowed when there are genuine issues
of constitutionality that must be addressed at the most immediate time. A
direct resort to this court includes availing of the remedies of certiorari

333
and prohibition to assail the constitutionality of actions of both legislative
and executive branches of the government.

A second exception is when the issues involved are of transcendental

importance.

Third, cases of first impression warrant a direct resort to this court. In

cases of first impression, no jurisprudence yet exists that will guide the
lower courts on this matter.

Fourth, the constitutional issues raised are better decided by this court.

Fifth, the time element presented in this case cannot be ignored.

Sixth, the filed petition reviews the act of a constitutional organ.

Seventh, petitioners rightly claim that they had no other plain, speedy, and
adequate remedy in the ordinary course of law that could free them from
the injurious effects of respondents' acts in violation of their right to
freedom of expression.

Eighth, the petition includes questions that are "dictated by public welfare
and the advancement of public policy, or demanded by the broader
interest of justice, or the orders complained of were found to be patent
nullities, or the appeal was considered as clearly an inappropriate
remedy." In the past, questions similar to these which this court ruled on
immediately despite the doctrine of hierarchy of courts included citizens'
right to bear arms, government contracts involving modernization of
voters' registration lists, and the status and existence of a public office.

It is not, however, necessary that all of these exceptions must occur at the
same time to justify a direct resort to this court. While generally, the
hierarchy of courts is respected, the present case falls under the
recognized exceptions and, as such, may be resolved by this court
directly.

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A direct invocation of this Court's original jurisdiction to issue these writs
should be allowed only when there are special and important reasons
clearly and specifically set out in the petition.

In this case, petitioner alleges that the case against him has been
scheduled for an expedited trial. Thus, petitioner claims that it is
necessary "to expeditiously arrive at a definitive ruling as to whether . . .
respondent [De Lima] committed grave abuse of discretion . . . in issuing
the [a]ssailed [r]esolutions." In his view, a direct invocation of this Court's
original jurisdiction is necessary. Petitioner argues that without this
Court's intervention, a situation may result where "the trial has already
concluded[,] while the issue on whether there exists probable cause to
charge [petitioner] with the crime of murder . . . has not been settled with
finality."

This argument is completely bereft of merit. It is not clear why any action
by the Court of Appeals, which has concurrent original jurisdiction in
petitions for certiorari under Rule 65, cannot be considered as sufficient
for review of petitioner's case.

Furthermore, the possibility of the conclusion of the trial of the case

against petitioner is not a reason that is special and important enough to
successfully invoke this Court's original jurisdiction. Once there has been
a judicial finding of probable cause, an executive determination of
probable cause is irrelevant. Consequently, even assuming that grave
abuse of discretion somehow taints an executive finding of probable
cause, such grave abuse of discretion has no effect in a trial. Whether
respondent De Lima, indeed, committed grave abuse of discretion in

335
relation to the executive determination of probable cause is irrelevant to
the trial itself.

(3) YES.

A petition for certiorari questioning the validity of the preliminary

investigation in any other venue is rendered moot by the issuance of a
warrant of arrest and the conduct of arraignment. In De Lima v. Reyes:

The filing of the information and the issuance by the trial court of the
respondent's warrant of arrest has already rendered this Petition moot.

It is settled that executive determination of probable cause is different

from the judicial determination of probable cause. In People v. Castillo and
Mejia:

There are two kinds of determination of probable cause: executive and

judicial. The executive determination of probable cause is one made
during preliminary investigation. It is a function that properly pertains to
the public prosecutor who is given a broad discretion to determine
whether probable cause exists and to charge those whom he believes to
have committed the crime as defined by law and thus should be held for
trial. Otherwise stated, such official has the quasi-judicial authority to
determine whether or not a criminal case must be filed in court. Whether
or not that function has been correctly discharged by the public
prosecutor, i.e., whether or not he has made a correct ascertainment of the
existence of probable cause in a case, is a matter that the trial court itself
does not and may not be compelled to pass upon.

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The judicial determination of probable cause, on the other hand, is one
made by the judge to ascertain whether a warrant of arrest should be
issued against the accused. The judge must satisfy himself that based on
the evidence submitted, there is necessity for placing the accused under
custody in order not to frustrate the ends of justice. If the judge finds no
probable cause, the judge cannot be forced to issue the arrest warrant.

The courts do not interfere with the prosecutor's conduct of a preliminary

investigation. The prosecutor's determination of probable cause is solely
within his or her discretion. Prosecutors are given a wide latitude of
discretion to determine whether an information should be filed in court or
whether the complaint should be dismissed.

A preliminary investigation is "merely inquisitorial," and is only

conducted to aid the prosecutor in preparing the information. It serves a
two-fold purpose: first, to protect the innocent against wrongful
prosecutions; and second, to spare the state from using its funds and
resources in useless prosecutions . . . .

....

Once the information is filed in court, the court acquires jurisdiction of the
case and any motion to dismiss the case or to determine the accused's
guilt or innocence rests within the sound discretion of the court. In Crespo
v. Mogul:

The filing of a complaint or information in Court initiates a criminal

action. The Court thereby acquires jurisdiction over the case, which is the
authority to hear and determine the case. When after the filing of the
complaint or information a warrant for the arrest of the accused is issued
by the trial court and the accused either voluntarily submitted himself to

337
the court or was duly arrested, the Court thereby acquired jurisdiction
over the person of the accused.

The preliminary investigation conducted by the fiscal for the purpose of

determining whether a prima facie case exists warranting the prosecution
of the accused is terminated upon the filing of the information in the
proper court. In turn, as above stated, the filing of said information sets in
motion the criminal action against the accused in Court. Should the fiscal
find it proper to conduct a reinvestigation of the case, at such stage, the
permission of the Court must be secured. After such reinvestigation the
finding and recommendations of the fiscal should be submitted to the
Court for appropriate action. While it is true that the fiscal has the quasi-
judicial discretion to determine whether or not a criminal case should be
filed in court or not, once the case had already been brought to Court
whatever disposition the fiscal may feel should be proper in the case
thereafter should be addressed for the consideration of the Court, the only
qualification is that the action of the Court must not impair the substantial
rights of the accused or the right of the People to due process of law.

Whether the accused had been arraigned or not and whether it was due to
a reinvestigation by the fiscal or a review by the Secretary of Justice
whereby a motion to dismiss was submitted to the Court, the Court in the
exercise of its discretion may grant the motion or deny it and require that
the trial on the merits proceed for the proper determination of the case.

However, one may ask, if the trial court refuses to grant the motion to
dismiss filed by the fiscal upon the directive of the Secretary of Justice will
there not be a vacuum in the prosecution? A state prosecutor to handle
the case cannot possibly be designated by the Secretary of Justice who

338
does not believe that there is a basis for prosecution nor can the fiscal be
expected to handle the prosecution of the case thereby defying the
superior order of the Secretary of Justice.

The answer is simple. The role of the fiscal or prosecutor as We all know
is to see that justice is done and not necessarily to secure the conviction of
the person accused before the Courts. Thus, in spite of his [or her] opinion
to the contrary, it is the duty of the fiscal to proceed with the presentation
of evidence of the prosecution to the Court to enable the Court to arrive at
its own independent judgment as to whether the accused should be
convicted or acquitted. The fiscal should not shirk from the responsibility
of appearing for the People of the Philippines even under such
circumstances much less should he [or she] abandon the prosecution of
the case leaving it to the hands of a private prosecutor for then the entire
proceedings will be null and void. The least that the fiscal should do is to
continue to appear for the prosecution although he [or she] may turn over
the presentation of the evidence to the private prosecutor but still under
his direction and control.

The rule therefore in this jurisdiction is that once a complaint or

information is filed in Court, any disposition of the case as to its dismissal
or the conviction or acquittal of the accused rests in the sound discretion
of the Court. Although the fiscal retains the direction and control of the
prosecution of criminal cases even while the case is already in Court he
[or she] cannot impose his [or her] opinion on the trial court. The Court is
the best and sole judge on what to do with the case before it. The
determination of the case is within its exclusive jurisdiction and
competence. A motion to dismiss the case filed by the fiscal should be
addressed to the Court who has the option to grant or deny the same. It
does not matter if this is done before or after the arraignment of the

339
accused or that the motion was filed after a reinvestigation or upon
instructions of the Secretary of Justice who reviewed the records of the
investigation.

Thus, it would be ill-advised for the Secretary of Justice to proceed with

resolving respondent's Petition for Review pending before her. It would
be more prudent to refrain from entertaining the Petition considering that
the trial court already issued a warrant of arrest against respondent. The
issuance of the warrant signifies that the trial court has made an
independent determination of the existence of probable cause . . . .

....

Here, the trial court has already determined, independently of any

finding or recommendation by the First Panel or the Second Panel, that
probable cause exists for the issuance of the warrant of arrest against
respondent. Probable cause has been judicially determined. Jurisdiction
over the case, therefore, has transferred to the trial court. A petition for
certiorari questioning the validity of the preliminary investigation in any
other venue has been rendered moot by the issuance of the warrant of
arrest and the conduct of arraignment.

Respondent De Lima's manifestation regarding the conviction of

petitioner of the crime of homicide is well-taken. However, even without
the conviction, this Petition has already been rendered moot and
academic by virtue of the judicial finding of probable cause in the form of
the Regional Trial Court's issuance of an arrest warrant against petitioner.

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 NAPOLEON S. RONQUILLO, JR., EDNA G. RAÑA, ROMEO
EFRUTO, PONCIANO T. ANTEGRO, ET AL., Petitioners, v.
NATIONAL ELECTRIFICATION ADMINISTRATION, EDITA S.
BUENO, MARIANO T. CUENCO, AND DIANA M. SAN LUIS,
Respondents.

G.R. No. 172593, April 20, 2016

LEONEN, J.:

DOCTRINE:
The doctrine of exhaustion of administrative remedies does not apply when the
issue deals with a question of law.

Issues dealing with the interpretation of law solely involve a question of law. A
question of law exists when the law applicable to a particular set of facts is not
settled, whereas a question of fact arises when the truth or falsehood of alleged
facts is in doubt.

FACTS:

To provide the country's total electrification on an area coverage

basis, the National Electrification Administration (NEA) was established
as a government agency. NEA later became a public corporation under
PD 269. Expanded by succeeding laws, NEA has since sought to bring
electrical power to rural and remote areas, as well as enhance the
competence of electric distribution utilities in a deregulated electricity
market.

Petitioners Napoleon S. Ronquillo, Jr., et al. former employees of NEA.

Before July 1, 1989, NEA paid its employees their COLA, which was

341
equivalent to 40% of their basic pay, in addition to their basic pay and
other allowances.

On July 1, 1989, RA 6758, otherwise known as the Compensation and

Position Classification Act of 1989, became the new salary standardization
law applicable to all government officials and employees.

Section 12 of RA 6758 provides that, as a general rule, all allowances are

already included in the new standardized salary rates. Thus, NEA
discontinued paying the COLA of its employees from July 1, 1989.

Pursuant to RA 6758, the DBM issued Corporate Compensation Circular

No. 10 dated February 15, 1989, otherwise known as Rules and
Regulations for the Implementation of the Revised Compensation and
Position Classification Plan in GOCCs/GFIs.

Taking its cue from Section 12 of RA 6758, which provides for the general
rule of integration of allowances into the basic salary, Corporate
Compensation Circular No. 10 states that allowances given on top of basic
salary shall be "discontinued] without qualification[.]" Otherwise,
payment of these allowances constitutes an "illegal disbursement of
public funds."

Corporate Compensation Circular No. 10, which took effect on November

1, 1989, was challenged before this Court. In De Jesus v. Commission on
Audit this Court struck down Corporate Compensation Circular No. 10
because it lacked publication and the employees were not given the
opportunity to be heard. The Decision was promulgated on August 12,
1998.

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After Corporate Compensation Circular No. 10 was ruled as ineffective
and unenforceable, several government agencies began giving back pays
to their employees. The back pay consisted of the allowances that had
been discontinued.

The DBM re-issued and published Corporate Compensation Circular No.

10, which became effective on March 16, 1999.NEA paid the COLA of its
employees for the period of July 1, 1989 until July 15, 1999.

On November 12, 2001, the DBM issued Budget Circular 2001-0325 stating
that the COLA, among others, is already deemed integrated in the basic
salary. Payment of the COLA is, therefore, unauthorized.

In 2001, Congress passed RA 9136, otherwise known as the Electric Power

Industry Reform Act of 2001 (EPIRA), which provides for a framework to
restructure the power industry.

Under Section 63 of the EPIRA, national government employees who

would be displaced or separated from services due to the restructuring of
the power industry are entitled to separation pay. These affected
employees would be considered legally terminated, pursuant to Rule 33,
Section 3 (b)(ii) of the EPIRA IRR.

The reorganization of NEA affected the employment of Ronquillo, Jr., et

al. On November 7, 2003, more than half of them chose early retirement,
while the rest were dismissed from work on December 31, 2003.

343
Ronquillo, Jr., et al. were given separation pay, the total amount of which
excludes the balance of their COLA, specifically for the period of July 16,
1999 until their separation from service on November 7 or December 31,
2003. They demanded that NEA, et al. give back pay for their COLA, but
this was refused. NEA, et al. informed them that NEA needed the funds
to cover the separation pay of all the affected employees.

On September 8, 2004, Administrator Bueno wrote to the COA, seeking to

clarify the legality of paying the COLA as part of the back pay of former
NEA employees. COA opined that NEA employees were no longer
entitled to the payment of the COLA after Corporate Compensation
Circular No. 10 was finally published.

RTC denied the Petition for mandamus filed by Ronquillo, et al. for lack
of merit.

As correctly raised by the respondents, in order for a petition for

mandamus, the petitioner must show that he has a well defined, clear and
certain right for the grant thereof. Section 3 Rule 65 of the Revised Rules
of Court refers to unlawful neglect of the performance of an act enjoined
by law or which unlawfully excludes another from the use and enjoyment
of a right or office to which such other is entitled.

Ronquillo, Jr., et al. moved for reconsideration, but the Motion was
likewise denied on March 28, 2006. Raising a question of law, they
appealed directly before this Court under Rule 45 of the 1997 Revised
Rules of Court.

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ISSUES:

Whether petitioners Ronquillo, Jr., et al. can appeal the Regional Trial
Court's Decision directly before this Court

RULING: YES.

According to respondents, the case is premature as petitioners failed to

exhaust administrative remedies.

Respondents are mistaken. The doctrine of exhaustion of administrative

remedies does not apply when the issue deals with a question of law:

[The case] does not involve an examination of the probative value of the
evidence presented by the parties. There is a question of law when the
doubt or difference arises as to what the law is on a certain state of facts,
and not as to the truth or the falsehood of alleged facts. Said question [of
law] at best could be resolved only tentatively by the administrative
authorities. The final decision on the matter rests not with them but with
the courts of justice. Exhaustion of administrative remedies does not
apply, because nothing of an administrative nature is to be or can be
done. The issue does not require technical knowledge and experience but
one that would involve the interpretation and application of law.

Issues dealing with the interpretation of law solely involve a question of

law. A question of law exists when the law applicable to a particular set of
facts is not settled, whereas a question of fact arises when the truth or
falsehood of alleged facts is in doubt.

345
The case involves a question of law, specifically, whether Republic Act
No. 6758 and the re-issuance and publication of the Department of Budget
and Management's Corporate Compensation Circular No. 10 entitle
petitioners to the back pay of the COLA.

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 VIRGINIA DIO, Petitioner, v. PEOPLE OF THE PHILIPPINES AND
TIMOTHY DESMOND, Respondents.

G.R. No. 208146

June 08, 2016

Leonen, J.

DOCTRINE:

When a motion to quash an information is based on a defect that may be cured by

amendment, courts must provide the prosecution with the opportunity to amend
the information.

FACTS:

Private respondent Timothy Desmond (Desmond) is the Chair and

Chief Executive Officer of Subic Bay Marine Exploratorium, of which Dio
is Treasurer and Member of the Board of Directors.

On December 9, 2002, Desmond filed a complaint against Dio for

libel. Two (2) separate Informations, both dated February 26, 2003, were
filed and docketed as Criminal Case Nos. 9108 and 9109.

Dio moved to quash the Informations, arguing that the "facts charged do
not constitute an offense”, but the motion was denied. On October 11,
2005, Dio filed a Motion for leave of court to file a second motion for
reconsideration. She also filed an Omnibus Motion to quash the
Informations for failure to allege publication and lack of jurisdiction, and
for second reconsideration with leave of court.

The trial court's Order dated February 7, 2006 denied both Motions and
scheduled Dio's arraignment on March 9, 2006.19 Dio moved for partial

347
reconsideration. The trial court granted Dio's Motion for Partial
Reconsideration.

After filing a Notice of Appeal Desmond contended before the Court of

Appeals that the lower court erred in dismissing the case and quashing
the Informations without giving the prosecutor the opportunity to amend
the Informations.

the Court of Appeals sustained that the Informations did not substantially
constitute the offense charged. However, it found that the trial court erred
in quashing the Informations without giving the prosecution a chance to
amend them pursuant to Rule 117, Section 4 of the Rules of Court.

Dio stresses that "venue is jurisdictional in criminal cases."37 Considering

that libel is limited as to the venue of the case, failure to allege "where the
libelous article was printed and first published"38 or "where the offended
party actually resided at the time of the commission of the offense"39 is a
jurisdictional defect. She argues that jurisdictional defects in an
Information are not curable by amendment, even before arraignment.

ISSUE:

Whether an information's failure to establish venue is a defect that can be

cured by amendment before arraignment

RULING:

No. If a motion to quash is based on a defect in the information that can

be cured by amendment, the court shall order that an amendment be
made. Rule 117, Section 4 of the Rules of Court states:

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SEC. 4. Amendment of complaint or information. - If the motion to quash
is based on an alleged defect of the complaint or information which can
be cured by amendment, the court shall order that an amendment be
made.

If it is based on the ground that the facts charged do not constitute an

offense, the prosecution shall be given by the court an opportunity to
correct the defect by amendment. The motion shall be granted if the
prosecution fails to make the amendment, or the complaint or information
still suffers from the same defect despite the amendment.

In this case, petitioner Virginia Dio has not yet been arraigned; thus, Rule
117, Section 4 of the Rules of Court applies. If the information is defective,
the prosecution must be given the opportunity to amend it before it may
be quashed.

Petitioner claims that Rule 117, Section 4 of the Rules of Court applies
only to informations that can be cured by amendment. She argues that
before a court orders that an amendment be made, or otherwise gives the
prosecution an opportunity to amend an information, it must first
establish that the defective information can be cured by amendment.

A defect in the complaint filed before the fiscal is not a ground to quash
an information. In Sasot v. People:

Section 3, Rule 117 of the 1985 Rules of Criminal Procedure, which was
then in force at the time the alleged criminal acts were committed,
enumerates the grounds for quashing an information, to wit:

a) That the facts charged do not constitute an offense;

b) That the court trying the case has no jurisdiction over the offense
charged or the person of the accused;

c) That the officer who filed the information had no authority to do so;

349
 d) That it does not conform substantially to the prescribed form;

e) That more than one offense is charged except in those cases in which
existing laws prescribe a single punishment for various offenses;

f) That the criminal action or liability has been extinguished;

g) That it contains averments which, if true, would constitute a legal

excuse or justification; and

h) That the accused has been previously convicted or in jeopardy of

being convicted, or acquitted of the offense charged.

Nowhere in the foregoing provision is there any mention of the defect in

the complaint filed before the fiscal and the complainant's capacity to sue
as grounds for a motion to quash.

For quashal of an information to be sustained, the defect of the

information must be evident on its face. In Santos v. People:62

First, a motion to quash should be based on a defect in the information

which is evident on its face. The same cannot be said herein. The
Information against petitioner appears valid on its face; and that it was
filed in violation of her constitutional rights to due process and equal
protection of the laws is not evident on the face thereof. As pointed out by
the CTA First Division in its 11 May 2006 Resolution, the more
appropriate recourse petitioner should have taken, given the dismissal of
similar charges against Velasquez, was to appeal the Resolution dated 21
October 2005 of the Office of the State Prosecutor recommending the
filing of an information against her with the DOJ Secretary.

For an information to be quashed based on the prosecutor's lack of

authority to file it, the lack of the authority must be evident on the face of
the information.

350
The Informations here do not allege that the venue of the offense was
other than Morong, Bataan. Thus, it is not apparent on the face of the
Informations that the prosecutor did not have the authority to file them.

The proper remedy is to give the prosecution the opportunity to amend

the Informations. If the proper venue appears not to be Morong, Bataan
after the Informations have been amended, then the trial court may
dismiss the case due to lack of jurisdiction, as well as lack of authority of
the prosecutor to file the information.

351
INGRID SALA SANTAMARIA and ASTRID SALA BOZA, Petitioners,
vs. THOMAS CLEARY, Respondent.

G.R. No. 197122

June 15, 2016

LEONEN, J.

DOCTRINE:

A foreigner plaintiff residing abroad who chose to file a civil suit in the
Philippines is allowed to take deposition abroad for his direct testimony pursuant
to Rule 23, Section 4(c)(2) of the Rules of Court.

FACTS:

Cleary, an American citizen with office address in California, filed a

Complaint6 for specific performance and damages against Miranila Land
Development Corporation, Manuel S. Go, Ingrid Sala Santamaria
(Santamaria), Astrid Sala Boza (Boza), and Kathryn Go-Perez (Go-Perez)
before the Regional Trial Court of Cebu.

The Complaint involved shares of stock of Miranila Land Development

Corporation, for which Cleary paid US$191,250.00.7 Cleary sued in
accordance with the Stock Purchase and Put Agreement he entered into
with Miranila Land Development Corporation, Manuel S. Go, Santamaria,
Boza, and Go-Perez.

Cleary elected to file the case in Cebu.

Santamaria, Boza, and Go-Perez filed their respective Answers with

Compulsory Counterclaims. The trial court then issued a notice of pre-
trial conference dated July 4, 2007.

In his pre-trial brief, Cleary stipulated that he would testify "in support of
the allegations of his complaint, either on the witness stand or by oral

352
deposition." Moreover, he expressed his intent in availing himself "of the
modes of discovery under the rules."

On January 22, 2009, Cleary moved for court authorization to take

deposition. He prayed that his deposition be taken before the Consulate-
General of the Philippines in Los Angeles and be used as his direct
testimony.

Santamaria and Boza opposed the Motion and argued that the right to
take deposition is not absolute. They claimed that Cleary chose the
Philippine system to file his suit, and yet he deprived the court and the
parties the opportunity to observe his demeanor and directly propound
questions on him.

The trial court denied Cleary’s Motion for Court Authorization to Take
Deposition in the Order2. Cleary elevated the case to the Court of
Appeals.

On August 10, 2010, the Court of Appeals granted Cleary’s Petition

for Certiorari and reversed the trial court’s ruling. It held that Rule 23,
Section 1 of the Rules of Court allows the taking of depositions, and that it
is immaterial that Cleary is the plaintiff himself.

ISSUE:

Whether a foreigner plaintiff residing abroad who chose to file a civil suit
in the Philippines is allowed to take deposition abroad for his direct
testimony on the ground that he is "out of the Philippines" pursuant to
Rule 23, Section 4(c)(2) of the Rules of Court.

RULING:

Yes. The relevant section in Rule 23 of the Rules of Court provides:

353
SECTION 1. Depositions pending action, when may be taken. – By leave of
court after jurisdiction has been obtained over any defendant or over
property which is the subject of the action, or without such leave after an
answer has been served, the testimony of any person, whether a party or
not, may be taken, at the instance of any party, by deposition upon oral
examination or written interrogatories. The attendance of witnesses may
be compelled by the use of a subpoena as provided in Rule 21.
Depositions shall be taken only in accordance with these Rules. The
deposition of a person confined in prison may be taken only by leave of
court on such terms as the court prescribes. (Emphasis supplied)

As regards the taking of depositions, Rule 23, Section 1 is clear that the
testimony of any person may be taken by deposition upon oral
examination or written interrogatories at the instance of any party.

On the use of depositions taken, we refer to Rule 23, Section 4 of the Rules
of Court. This Court has held that "depositions may be used without the
deponent being actually called to the witness stand by the proponent,
under certain conditions and for certain limited purposes."71 These
exceptional cases are enumerated in Rule 23, Section 4(c) as follows:

SEC 4. Use of depositions. – At the trial or upon the hearing of a motion or

an interlocutory proceeding, any part or all of a deposition, so far as
admissible under the rules of evidence, may be used against any

party who was present or represented at the taking of the deposition or

who had due notice thereof, in accordance with any one of the following
provisions:

....

(c) The deposition of a witness, whether or not a party, may be used by

any party for any purpose if the court finds: (1) that the witness is dead;
or (2) that the witness resides at distance more than one hundred (100)
kilometers from the place of trial or hearing, or is out of the Philippines,
unless it appears that his absence was procured by the party offering the
deposition; or (3) that the witness is unable to attend or testify because of
age, sickness, infirmity, or imprisonment; or (4) that the party offering the

354
deposition has been unable to procure the attendance of the witness by
subpoena; or (5) upon application and notice, that such exceptional
circumstances exist as to make it desirable, in the interest of justice and
with due regard to the importance of presenting the testimony of
witnesses orally in open court, to allow the deposition to be used.

The difference between the taking of depositions and the use of

depositions taken is apparent in Rule 23, which provides separate sections
to govern them.

The rules thus support greater leeway in allowing the parties and their
witnesses to be deposed in the interest of collecting information for the
speedy and complete disposition of cases.

The trial court’s Order was based on two (2) premises: first, that
respondent should submit himself to our court processes since he elected
to seek judicial relief with our courts; and second, that respondent is not
suffering from any impairment and it is best that he appear before our
courts considering he is the plaintiff himself.

On the first premise, apparent is the concern of the trial court in giving
undue advantage to non-resident foreigners who file suit before our
courts but do not appear to testify. Petitioners support this ruling. They
contend that the open-court examination of witnesses is part of our
judicial system. Thus, there must be compelling reason to depart from this
procedure in order to avoid suits that harass Filipino litigants before our
courts. Moreover, they argue that it would be costly, time-consuming, and
disadvantageous for petitioners and their counsels to attend the
deposition to be taken in Los Angeles for the convenience of respondent.

In the Stock Purchase and Put Agreement, petitioners and respondent

alike agreed that respondent had the sole discretion to elect the venue for
filing any action with respect to it.

Paragraph 9.02 of the Agreement is clear that the parties "waive any other
preferential jurisdiction by reason of domicile." If respondent filed the suit
in the United States—which he had the option to do under the
Agreement—this would have been even more costly, time-consuming,

355
and disadvantageous to petitioners who are all Filipinos residing in the
Philippines. There is no question that respondent can file the case before
our courts. With respondent having elected to file suit in Cebu, the bone
of contention now is on whether he can have his deposition taken in the
United States. The trial court ruled that respondent should consequently
submit himself to the processes and procedures under the Rules of Court.

Respondent did avail himself of the processes and procedures under the
Rules of Court when he filed his Motion. He invoked Rule 23, Section
4(c)(2) of the Rules of Court and requested to have his deposition taken in
Los Angeles as he was "out of the Philippines."

Moreover, Rule 23, Section 1 of the Rules of Court no longer requires

leave of court for the taking of deposition after an answer has been
served. According to respondent, he only sought a court order when the
Department of Foreign Affairs required one so that the deposition may be
taken before the Philippine Embassy or Consulate.

That neither the presiding judge nor the parties will be able to personally
examine and observe the conduct of a deponent does not justify denial of
the right to take deposition. This objection is common to all depositions.
Allowing this reason will render nugatory the provisions in the Rules of
Court that allow the taking of depositions.

As suggested by the Court of Appeals, the parties may also well agree to
take deposition by written interrogatories to afford petitioners the
opportunity to cross-examine without the need to fly to the United States.

The second premise is also erroneous. That respondent is "not suffering

from any impairment, physical or otherwise" does not address the ground
raised by respondent in his Motion. Respondent referred to Rule 23,
Section 4(c)(2) of the Rules of Court, in that he was "out of the
Philippines." This Section does not qualify as to the condition of the
deponent who is outside the Philippines.

Moreover, petitioners argue that the deposition sought by respondent is

not for discovery purposes as he is the plaintiff himself. Jurisprudence has
discussed how "[u]nder the concept adopted by the new Rules, the

356
deposition serves the double function of a method of discovery—with use
on trial not necessarily contemplated—and a method of presenting
testimony." The taking of depositions has been allowed as a departure
from open-court testimony.

WHEREFORE, the Petitions are DENIED for lack of merit.

357
ARIEL LOPEZ, Petitioner, v. PEOPLE OF THE PHILIPPINES, Respondent.

G.R. No. 212186,

June 29, 2016

LEONEN, J.:

DOCTRINE:

A "request for appearance" issued by law enforcers to a person identified as a

suspect is akin to an "invitation." Thus, the suspect is covered by the rights of an
accused while under custodial investigation. Any admission obtained from the
"request for appearance" without the assistance of counsel is inadmissible in
evidence.

FACTS:

Petitioner Ariel Lopez (Lopez) was charged with violation of

Presidential Decree No. 533 (Cattle-rustling). Lopez pleaded not guilty
during his arraignment.

During trial, Mario Perez (Perez) testified that he purchased the female
carabao from a certain Enrique Villanueva. The purchase was evidenced
by a Certificate of Transfer of Large Cattle.

Perez narrated that he searched for his missing carabao for over a month.
After, he went to the Barangay Captain of Wines to ask for assistance.

Prosecution witness Felix Alderete (Alderete) testified that he worked as

an errand boy for Lopez from 2000 to 2002. Alderete claimed that he slept
at Lopez's house on July 17, 2002. Around 3:45 a.m. of the next day,
Alderete and Lopez went to Constancio Genosas' property. Lopez untied
the carabao and allegedly told Alderete that he would "bring the carabao
to his boss named Boy Platan at Malagos." He ordered Alderete to deliver
the carabao to Malagos. Alderete, not knowing whether the carabao was
owned by Lopez, followed Lopez's instructions. The next day, Alderete
learned that there was a commotion in Wines, Baguio District, regarding

358
Perez's lost carabao. Afraid of being accused for the loss of the carabao,
Alderete sought help from the barangay police.

Teresita Perez (Teresita) testified that Barangay Police Moralde informed

her and Perez, her husband, that Lopez stole their carabao. Subsequently,
a confrontation took place at the barangay police station. During the
confrontation, Lopez admitted to taking the carabao and promised to pay
indemnification.

Police Officer III Leo Lozarito (PO3 Lozarito) corroborated Teresita's

testimony and stated that a request for Lopez's appearance was issued,
but no custodial investigation was conducted. He claimed that he simply
allowed Lopez and Teresita to "confront each other." He also stated that
Lopez wanted to settle by paying for the carabao, but the parties were
unable to agree on the price.

Lopez testified that he went to the police station where he denied stealing
any carabao. After his appearance at the police station, he went home.

The trial court found Lopez guilty of cattle-rustling. It gave credence to

Alderete's testimony that Lopez ordered him to bring the carabao to
Malagos.31 The trial court also noted Alderete's statement that "he knew
Lopez was engaged in the buy and sell of large cattle."

In addition, the trial court discussed that Lopez's defense of denial had
no credence because during the meeting at the police station, Lopez
offered to reimburse the value of the carabao and even knelt in front of
Teresita to ask for forgiveness.

Lopez filed before the Court of Appeals an appeal arguing that the
prosecution was unable to prove that the carabao allegedly stolen was the
same carabao owned by Mario and Teresita Perez. He argued that the
"request for appearance . . . issued by PO3 Lozarito was in violation of his
custodial rights."

The Court of Appeals ruled that the Certificate of Transfer of Large Cattle
and Alderete's testimony were sufficient to prove the ownership of the

359
lost carabao. Further, the Court of Appeals held that there was no
violation of Lopez's custodial rights.

ISSUE:

Whether petitioner's uncounselled admission during the confrontation at

the barangay police office is admissible in evidence.

RULING:

No. Petitioner's uncounselled admission during the confrontation at the

police station is inadmissible in evidence.

The Court of Appeals held that "[t]he constitutional procedures on

custodial investigation do not apply to a spontaneous statement, not
elicited through questioning by the authorities, but given in an ordinary
manner whereby the accused orally admits having committed the crime."

However, the record shows that petitioner's appearance before the police
station was far from being voluntary. The transcript of stenographic notes
during the January 30, 2006 hearing states:

Q: Sometime in the month of July 2002, have you come across with [sic]
a reported theft of large cattle?

A: Yes, sir.

Q: And what did you list from that report?

A: It was told to me by the Desk Officer, sir, that a theft of large cattle
was reported and the complainant is seeking assistance.

Q: And since the complainant sought assistance from the police, what
did the Baguio Police District do to the request of the complainant?

A: So, she identified the alleged suspect so I told my partner to issue a

360
 request from [sic] appearance so that the suspect will be confronted in
the police station.

Q: You said that you told your partner to invite the accused, what was
that phrase again?

A: Request for appearance.

Q: You said that you asked your partner to issue request for appearance,
do you know what happened to that request for appearance?

A: It was sent by us sir, and the alleged accused appeared to [sic] our
police station.
In this case, the so-called "request for appearance" is no different from the
"invitation" issued by police officers for custodial investigation.

Section 2 of Republic Act No. 7438100 provides:

SEC. 2. Rights of Persons Arrested, Detained or under Custodial Investigation;

Duties of Public Officers. -

....

As used in this Act, "custodial investigation" shall include the practice of

issuing an "invitation" to a person who is investigated in connection with
an offense he is suspected to have committed, without prejudice to the
liability of the "inviting" officer for any violation of law.

Custodial investigation has also been defined as: Custodial investigation

commences when a person is taken into custody and is singled out as a
suspect in the commission of a crime under investigation and the police
officers begin to ask questions on the suspect's participation therein and
which tend to elicit an admission.101chanroblesvirtuallawlibrary

The circumstances surrounding petitioner's appearance before the police

station falls within the definition of custodial investigation. Petitioner was
identified as a suspect in the theft of large cattle. Thus, when the request

361
for appearance was issued, he was already singled out as the probable
culprit.

People v. Bio has held that "the infractions of the so-called Miranda rights
render inadmissible only the extrajudicial confession or admission made
during custodial investigation."111 With this rule applied and petitioner's
uncounselled admission disregarded, petitioner should still be acquitted
because the prosecution was unable to prove the identity of the lost
carabao owned by Mario and Teresita Perez.

For the prosecution's failure to prove all the elements of cattle-rustling,

and for the violation of petitioner's rights during custodial investigation,
we hold that there is reasonable doubt that petitioner is guilty of cattle-
rustling. Thus, he must be acquitted.

WHEREFORE, premises considered, the Petition is GRANTED. The

Decision dated August 12, 2013 of the Court of Appeals in CA-G.R. CR
No. 00673-MIN is REVERSED and SET ASIDE. Petitioner Ariel Lopez
is ACQUITTED for failure of the prosecution to prove his guilt beyond
reasonable doubt. If detained, he is ordered
immediately RELEASED unless he is confined for any other lawful cause.
Any amount paid by way of a bailbond is ordered RETURNED.

362
 NATIONAL POWER CORPORATION, Petitioner, v. SOUTHERN
PHILIPPINES POWER CORPORATION, Respondent.

G.R. No. 219627

July 04, 2016

LEONEN, J.:

DOCTRINE:

Courts and litigants are enjoined to strictly abide by the rules. Nonetheless, this
Court has, in exceptionally meritorious cases, suspended the technical rules of
procedure "in order that litigants may have ample opportunity to prove their
respective claims, and that a possible denial of substantial justice, due to legal
technicalities, may be avoided. The court considered the following: (a) the
existence of special or compelling circumstances, (b) the merits of the case, (c) a
cause not entirely attributable to the fault or negligence of the party favored by
the suspension of the rules, (d) a lack of any showing that the review sought is
merely frivolous and dilatory, and (e) the other party will not be unjustly
prejudiced thereby.

FACTS:

On October 26, 1996, the consortium of ALSONS Power Holdings

Corporation and TOMEN Corporation entered into an Energy Conversion
Agreement with the National Power Corporation for a 50-megawatt
bunker- C fired diesel-generating power project in General Santos City.

The cooperation period between Southern Philippines Power Corporation

and the National Power Corporation started on the day after March 18,
1998, when the Power Station was declared completed.10 Since then until
2004, Southern Philippines Power Corporation consistently nominated 50
megawatts of the Power Station's capacity to the National Power
Corporation.

363
On February 2, 2005, Southern Philippines Power Corporation informed
the National Power Corporation that it installed an additional engine with
a five (5)-megawatt generating capacity. Thus, from April 2005, Southern
Philippines Power Corporation guaranteed to the National Power
Corporation a total capacity of 55 megawatts, equivalent to 110% of the
nominal capacity allowed under the Energy Conversion Agreement.

In a letter dated March 24, 2008, Southern Philippines Power Corporation

requested payment in the amount of P45,840,673.22, attributable to the
additional 10% capacity made available to the National Power
Corporation since 2005.

On January 6, 2009, Southern Philippines Power Corporation filed before

the Energy Regulatory Commission a Petition for Dispute
Resolution18 praying that National Power Corporation be ordered to pay
unpaid fees from 2005 to 2008.

On December 14, 2009, Southern Philippines Power Corporation filed a

Supplemental Petition praying for payment of the unpaid fees for the
period of 2005 to 2010.

The Energy Regulatory Commission, in its Decision22 dated April 1, 2013,

granted Southern Philippines Power Corporation's Petition and
Supplemental Petition.

The Commission's Order date June 3, 2013 denied the National Power
Corporation's Motion for Reconsideration for being filed out of time.

The Court of Appeals, in its Decision dated February 20, 2015, denied the
National Power Corporation's Petition for Review and affirmed the
Energy Regulatory Commission's April 1, 2013 Decision and June 3, 2013
Order. It also denied reconsideration.

Petitioner National Power Corporation argues that the Energy Regulatory

Commission should not have denied its Motion for
Reconsideration. Petitioner was under the honest impression that filing
its motion by private courier was sufficient compliance with Rule 23,

364
Section 1 and Rule 10, Section 4 of Resolution No. 38. 29 Unfortunately, the
Energy Regulatory Commission received the Motion four (4) days after its
due date and considered it filed out of time.

Petitioner argues that courts should not be too strict with procedural
technicalities when these do not impair the proper administration of
justice, and courts should rule on the merits as much as
possible. Petitioner quotes Rule 1, Sections 3 and 4 of the Energy
Regulatory Commission Rules, which provide for the Commission's
power to issue procedural directions and the liberal construction of the
rules "consistent with the requirements of justice.

ISSUE:

Whether the Court of Appeals erred in affirming the Energy Regulatory

Commission's denial of petitioner's Motion for Reconsideration, which
was filed by private courier and received by the Energy Regulatory
Commission four (4) days after due date

RULING:

Yes. The Court of Appeals erred in upholding the denial by the Energy
Regulatory Commission of petitioner's Motion for Reconsideration purely
on a technicality.

It is a basic tenet that procedural rules are necessary to facilitate an

orderly and speedy adjudication of disputes.59 Thus, courts and litigants
alike are enjoined to strictly abide by the rules. Nonetheless, this Court
has, in exceptionally meritorious cases, suspended the technical rules of
procedure "in order that litigants may have ample opportunity to prove
their respective claims, and that a possible denial of substantial justice,
due to legal technicalities, may be avoided.

365
In Philippine Bank of Communications v. Yeung,61 this Court adopted a
liberal approach to procedural rules and considered the petitioner's
motion for reconsideration as having been properly filed before the Court
of Appeals, though it was filed beyond the 15-day reglementary
period.62 The seven (7)-day delay in filing the motion for reconsideration
was found to be excusable in light of the merits of the case and because
the delay was not entirely attributable to the fault or negligence of the
petitioner.63 The Court cited Sanchez v. Court of Appeals64 among other
cases,65 which sets forth a number of reasons to be considered in
suspending procedural rules:

Aside from matters of life, liberty, honor or property which would

warrant the suspension of the Rules of the most mandatory character and
an examination and review by the appellate court of the lower court's
findings of fact, the other elements that should be considered are the
following: (a) the existence of special or compelling circumstances, (b) the
merits of the case, (c) a cause not entirely attributable to the fault or
negligence of the party favored by the suspension of the rules, (d) a lack
of any showing that the review sought is merely frivolous and dilatory,
and (e) the other party will not be unjustly prejudiced thereby.

Here, petitioner has shown a clear and persuasive reason for this Court to
relax the rules. The Energy Regulatory Commission previously allowed
petitioner to file its other pleadings through a private courier (such as
LBC) despite its prescribed mode on the filing of pleadings being either
personally or by registered mail.67 This liberality extended by the
Commission on petitioner's earlier filings gave it a reasonable ground to
believe that its filing of a motion for reconsideration through the same
private courier would be considered sufficient compliance with the
Energy Regulatory Commission Rules of Practice and Procedure.
Unfortunately, the Motion for Reconsideration reached the Commission
four (4) days beyond the due date.

Petitioner's delay in filing the motion for reconsideration was far from
being intentional and dilatory. Petitioner simply followed its usual mode
of filing its pleadings, which had been previously acceptable to the

366
Commission. The Energy Regulatory Commission itself adopts a liberal
policy in the construction of its Rules of Practice and Procedure "to secure
the most expeditious and least expensive determination of every
proceeding . . . on its merits." Hence, the Commission should have given
due course to petitioner's Motion for Reconsideration, given petitioner's
satisfactory explanation for missing the deadline.

Hence, we uphold the Court of Appeals' affirmation of the Energy

Regulator/ Commission's Decision holding petitioner National Power
Corporation liable to pay respondent Southern Philippines Power
Corporation for the contracted capacity of 55 megawatts from 2005 to
2010.

WHEREFORE, the Petition is DENIED.

367
THE DIOCESE OF BACOLOD, REPRESENTED BY THE MOST REV.
BISHOP VICENTE M. NAVARRA AND THE BISHOP HIMSELF IN
HIS PERSONAL CAPACITY, Petitioners, vs. COMMISSION ON
ELECTIONS AND THE ELECTION OFFICER OF BACOLOD CITY,
ATTY. MAVIL V. MAJARUCON, Respondents.

G.R. No. 205728

July 5, 2016

LEONEN, J.:

DOCTRINE:

Rule 64 is not the exclusive remedy for all acts of the COMELEC. Rule 65 is
applicable especially to raise objections relating to a grave abuse of discretion
resulting in the ouster of jurisdiction. As a special civil action, there must also be
a showing that there be no plain, speedy, and adequate remedy in the ordinary
course of the law.

FACTS:

This Motion for Reconsideration1 filed by respondents prays that

this Court reconsider its January 21, 2015 Decision and dismiss the
Petition for lack of merit. The dispositive portion of the Decision reads:

WHEREFORE, the instant petition is GRANTED. The temporary

restraining order previously issued is hereby made
permanent.1âwphi1 The act of the COMELEC in issuing the assailed notice
dated February 22, 2013 letter dated February 27, 2013 is declared
unconstitutional.

SO ORDERED.

Respondents reiterate that the assailed notice and letter are not final
orders by the Commission on Elections En Banc in the exercise of its
quasi-judicial functions, thus, not subject to this Court’s
review. Respondents contend that they merely implemented the law
when they issued the assailed notice and letter. These are reviewable not

368
by this Court but by the Commission on Elections pursuant to Article IX-
C, Section 2(3) of the Constitution on its power to decide "all questions
affecting elections." There are also remedies under Rule 34 of the
Commission on Elections Rule of Procedure on preliminary investigation
for election offenses. Respondents, thus, submit that petitioners violated
the rule on exhaustion of administrative remedies.

ISSUE:
Whether or not the assailed notice and letter by the COMELEC is
reviewable by the Court.

RULING:
Yes. Rule 64 is not the exclusive remedy for all Commission on Elections'
acts as Rule 65 applies for grave abuse of discretion resulting to ouster of
jurisdiction. As a special civil action, there must also be a showing that
there be no plain, speedy, and adequate remedy in the ordinary course of
the law.

Respondents contend that the assailed notice and letter are not subject to
review by this court, whose power to review is "limited only to final
decisions, rulings and orders of the COMELEC En Banc rendered in the
exercise of its adjudicatory or quasi-judicial power." Instead, respondents
claim that the assailed notice and letter are reviewable only by COMELEC
itself pursuant to Article IX-C, Section 2(3) of the Constitution on
COMELEC’s power to decide all questions affecting
elections. Respondents invoke the cases of Ambil, Jr. v. COMELEC, Repol
v. COMELEC, Soriano, Jr. v. COMELEC, Blanco v. COMELEC, and
Cayetano v. COMELEC, to illustrate how judicialintervention is limited to
final decisions, orders, rulings and judgments of the COMELEC En Banc.
The five (5) cases cited by respondents are not precedents since these
involve election protests or are disqualification cases filed by losing
candidates against winning candidates.

369
Petitioners are not candidates. The main subject of this case is an alleged
constitutional violation: the infringement on speech and the "chilling
effect" caused by respondent COMELEC’s notice and letter. They are
asserting their right to freedom of expression. We acknowledged the
"chilling effect" of the assailed notice and letter on this constitutional right
in our Decision, thus:

Nothing less than the electorate's political speech will be affected by the
restrictions imposed by COMELEC. Political speech is motivated by the
desire to be heard and understood, to move people to action. It is
concerned with the sovereign right to change the contours of power
whether through the election of representatives in a republican
government or the revision of the basic text of the Constitution. The zeal
with which we protect this kind of speech does not depend on our
evaluation of the cogency of the message. Neither do we assess whether
we should protect speech based on the motives of COMELEC. We
evaluate restrictions on freedom of expression from their effects. We
protect both speech and medium because the quality of this freedom in
practice will define the quality of deliberation in our democratic society.

COMELEC's notice and letter affect preferred speech. Respondents' acts

are capable of repetition. Under the conditions in which it was issued and
in view of the novelty of this case, it could result in a "chilling effect" that
would affect other citizens who want their voices heard on issues during
the elections. Other citizens who wish to express their views regarding
the election and other related issues may choose not to, for fear of reprisal
or sanction by the COMELEC.

Direct resort to this court is allowed to avoid such proscribed conditions.

Rule 65 is also the procedural platform for raising grave abuse of
discretion.

The urgency posed by the circumstances during respondents' issuance of

the assailed notice and letter-the then issue on the RH Law as well as the
then upcoming elections-also rendered compliance with the doctrine on
exhaustion of administrative remedies as unreasonable.33

370
All these circumstances surrounding this case led to this Court's pro hac
vice ruling to allow due course to the Petition.

WHEREFORE, the Motion for Reconsideration

is DENIED with FINALITY.

371
 People of the Philippines, Plaintiff-Appellee v. Edilberto Pusing y
Tamor, Accused-Appellant

G.R. No. 208009

11 July 2016

Leonen, J.

DOCTRINE:
It is settled that “factual findings of the trial court and its evaluation of the
credibility of witnesses and their testimonies are entitled to great respect and will
not be disturbed on appeal, unless the trial court is shown to have overlooked,
misapprehended, or misapplied any fact or circumstance of weight and
substance.”

FACTS:
On or about April 5, 2004, while they were at home, Pusing
allegedly went on top of AAA, put his penis in her mouth, mashed her
breasts, kissed her on the lips, licked her vagina, and inserted his penis
into her genitalia. The next day, Pusing’s neighbor told BBB, AAA’s
cousin to take AAA’s custody because Pusing allegedly did something to
her. BBB then took AAA to his house in Manila, where she revealed the
rape to BBB and his wife.

BBB assisted AAA in filing a complaint before the police. AAA was
refered to the Philippine National Police Crime Laboratory for medical
examination.

In four (4) separate Informations, Pusing was charged with the rape
and abuse of AAA, a 12-year-old minor with the cognitive ability of
anine-year-old.

Five (5) witnesses were presented for the prosecution: AAA, her
cousin BBB, PCI Joseph Palermo, M.D., Dr. Elma Tolentino, and Police
Officer III Dennis B. Salopaguio.

372
 AAA testified that on the day of the incident, she and Pusing were
home when he consummated the act.

BBB testified that he and his wife found out about what Pusing did after
BBB rescued the victim. BBB confirmed that AAA has been intellectually
challenged even before the incident and that Pusing was aware of this.
BBB also testified that AAA was only 14 years old at the time he
discovered the abuse.

Dr. Tolentino testified that based on AAA’s dental examination, she was
about 14 years old at the time of rape.

Dr. Palermo issued a Medico-Legal Report finding that AAA had a deep-
healed laceration, with “clear evidence of blunt force or trauma or
penetrating trauma.”

On the other hand, two (2) witnesses testified for the defense: Pusing and
CCC, the sister of AAA’s mother.

Pusing testified that he treated AAA as his adopted daughter; he could

not have committed rape against her. He did not know that she was
suffering from any intellectual disability. He claimed that the filing of the
case was instigated by BBB, who had ill feelings towards his mother,
CCC, and was interested in Pusing’s house and lot.

CCC testified that at the time of the alleged incidents, she and Pusing
were busy attending to the wake of her deceased son, BBB’s sibling. She
claimed that BBB and Pusing were not in good terms, and BBB caused
Pusing’s arrest because of interest of Pusing’s house. On cross-
examination, she admitted that she was not aware how BBB would
benefit in filing the case.

The Regional Trial Court, in its decision on March 16, 2009, found Pusing
guilty beyond reasonable doubt of two (2) counts of qualified rape and
one (1) count of child abuse. The Court of Appeals, in its decision on
August 24, 2012, affirmed in toto the deicion of the Regional Trial Court .

373
ISSUE:
Whether the Trial Court committed error in the evaluation of the
credibility of the prosecution witnesses and their testimonies.

RULING:
The Supreme Court affirmed the decision of the Court of Appeals.
The Court held that the Regional Trial Court and the Court of Appeals
correctly found that the victim’s testimony is credible. Given AAA’s
cognitive “immaturity and lowly intelligence,” she “couldn’t have
concoted a tale of pure fantasy out a mere imagination.”

The accused-appellant offered in defense were denials and alibis,

defenses which jurisprudence has long considered weak and unreliable.

The Reginal Trial Court properly found, as affirmed by the Court of

Appeals, that the testimonies of AAA, BBB, and the medico-legal officer
of the PNP, among others, were considtent with each other and with the
physical evidence. There was no showing that the witnesses for the
prosecution had ill motives to testify against accused-appellant. Their
testimonies are accorded full faith and credence.

In sum, the Regional Trial Court and the Court of Appeals did not
err in finding the accused-appellant guilty beyond reasonable doubt of
two (2) counts of qualified rape and one (1) count of child abuse.

374
 Janet Lim Napoles, petitioner v. Hon. Secretary Leila De Lima, et al.,
respondents

G.R. No. 213529

13 July 2016

Leonen, J.

DOCTRINE:
It is true that the Constitution allows the exercise of the power of judicial review
in cases where grave abuse of discretion exists. In this case, however, a petition
for certiorari before this Court was not the “plain, speedy, and adequate remedy
in the ordinary course of law” because, as discussed, the trial court already
acquired jurisdiction over the case. The proper remedy for Napoles was to proceed
to trial and allow the exhaustive presentation of evidence by the parties.

FACTS:
On August 6, 2013, through a Review Resolution, Petitioner
Napoles was charged with serious illegal detention by Senior Deputy
State Prosecutor and Chair of the Task Force on Anti-Kidnapping
Theodore Villanueva (Prosecutor Villanueva) for allegedly detaining
Benhur Luy in connection with the anomalous transactions of the JLN
Group of Companies involving the Priority Development Assistance
Fund (PDAF). According to Prosecutor Villanueva, the alleged diversion
of government funds to the JLN Group of Company’s dummy
foundations was necessary to “establish the alleged motive of Napoles
and Lim in detaining Benhur Luy against his will.” Moreover, there was
probable cause to believe that Luy was deprived of his liberty, given the
allegations in his sworn affidavit.

The Review Resolution was approved by Prosecutor General

Arellano, and an Information for serious illegal detention was filed before
the Regional Trial Court of Makati against Napoles and Lim. The case was
raffled to Branch 150 presided by Judge Elmo Alameda. Recommending
no bail for Napoles and Lim, Judge Alameda issued a warrant for their
arrest.

375
 Napoles filed before the Court of Appeals a Petition for Certiorari
alleging grave abuse of discretion on the part of Secretary De Lima,
Prosecutor General Arellano, Prosecutor Villanueva, NBI Director Rojas,
and Judge Alameda. She contended that there was no probable cause to
charge her with serious illegal detention, and that Judge Alameda erred in
issuing the arrest warrant despite the pendency of her Motion for Judicial
Determination of Probable Cause.

With respect to the issuance of arrest warrant, the Court of Appeals

noted Napoles’ “attempt to quash the warrat of arrest issued against her
by way of Petition for Certiorari.” Moreover, since Napoles failed to
attach copies of the arrest warrant in her Petition for Certiorari, the Court
of Appeals refused to squarely rule on the issue of whether there was
grave abuse of discretion in its issuance.

Finding no grave abuse of discretion in the filing of the information

in court and the issuance of the arrest warrant, the Court of Appeals
dismissed Napoles’ Petition for Certiorari in its March 26, 2014 decision.
Napoles moved for reconsideration but the Court of Appeals denied the
Motion.

On September 11, 2014, Napoles filed before the Supreme Court her
Petition for Review on Certiorari with Application for a Temporary
Restraining Order and/or Writ of Preliminary Injunction. In her Petition
for Review on Certiorari, Napoles maintains that respondents
whimsically and arbitrarily found probable cause against her. In Napoles’
view, the Review Resolution was issued not because Luy was illegally
detained but because the government needed to get hold of her in
connection with the allegations of Luy on the misuse of the PDAF by
legislators.

The respondents argued that Judge Alameda’s issuance of the arrest

warrant was not attended with grave abuse of discretion. For them, “what
is essential is that Judge Alameda was able to review the prosecutor’s
finding and, on the basis thereof, affirmed the prosecutor’s determination
of probable cause.”

376
ISSUE:
Whether the Court of Appeals erred in finding no grave abuse of
discretion in the issuance of warrant for here arrest.

377
RULING:
The Supreme Court denied the Petition for being moot and
academic. In any case, the Court of Appeals did not err in dismissing the
Petition for Certiorari. There was no grave abuse of discretion either in
the filing of information in court or in the issuance of the arrest warrant
against Napoles.

With the filing of the Information before the trial court, it has then
acquired exclusive jurisdiction over the case, and the determination of the
accused’s guilt or innocence rests within the sole and sound discretion of
the trial court. The proper remedy for Napoles was to proceed to trial and
allow the exhaustive presentation of evidence by the parties.

378
 People of the Philippines, plaintiff-appellee, v. Gloria Caiz y Talvo,
accused-appellant

G.R. No. 215340

13 July 2016

Leonen, J.

DOCTRINE:
There should be stricter compliance with the rule on the chain of custody when
the amount of the dangerous drug is minute due to the possibility that the seized
item was tampered

FACTS:
Two (2) Informations were filed against accused-appellant Caiz for
violation of Sections 5 and 11 of Republic Act No. 9165.

During the trial, Police Officer I Valle (PO1 Valle), Senior Police
Officer I Patricio (SPO1 Patricio), and Police Officer III Datuin (PO3
Datuin) were presented as witnesses. They testified on the events “ebfore,
during, and after the buy-bust operation.”

After the verification surveillance, SPO1 Patricio, PO1 Valle, and the
confidential informant went to Caiz’s house at around 11:00 am to
conduct the buy-bust operation. The information introduced the
policemen as poseur-buyers who would like to purchase P600.00 worth of
shabu. The marking used was “RDP,” the initials of SPO1 Patricio.

After Caiz received the marked money, she handed a “small

transparent plastic sachet containing white crystalline substance” to SPO1
Patricio. SPO1 Patricio then removed his bonnet, which was the
prearranged signal of the operation. SPO1 Patricio and PO1 Valle
identified themselves to Caiz as police officers and proceeded to arrest
her.

379
 After arrest, PO1 Valle frisked her and recovered the marked money
and two (2) more plastic sachets containing shabu from Caiz’s pocket.
Caiz was then brought to the PNP Lingayen for interrogation and
documentation.

Items recovered from Caiz were turned over by PO1 Valle to SPO1
Patricio for marking purposes. The plastic sachet sold to the policemen
was marked “RDP.” The two (2) other plastic sachets confiscated from
Caiz were marked “RDP1” and “RDP2.”

PO1 Valle testified that the seized sachets were marked by SPO1
Patricio immediately after Caiz was arrested. On the other hand, SPO1
Patricio testified that the seized sachets were marked ath the police
station.

On July 18, 2012, the trial court found Caiz guilty of violating
Section 5 of R.A. 9165 but dismissed the case for violation of Section 11.
The trial court held that the charge for illegal possession of dangerous
drugs was to be absorbed by the crime of illegal sale.

In her appeal before the Court of Appeals, Caiz argued that the
place where the seized sachets were marked was not proven because the
policemen gave different testimonies. Further, the confiscation receipts
prepared by SPO1 Patricio were not signed by Caiz, her representative or
counsel, a representative from the media, a representative froom the
Department of Justice, or any public official. Caize was not given a copy.
She also claimed that there were no photographs of the seized sachets and
the booking sheet of the accused was prepared on the day after she was
arrested.

Despite the argument of Caiz of the failure to follow the required

procedure in handling the seized items, the Court of Appeals dismissed
the appeal and affirmed in toto the decision of the trial court.

ISSUE:

380
Whether the Court of Appeals erred in affirming the decision of the
Regional Trial Court considering the lapse of the law enforcers to comply
with the procedural requirement in handling the seized items.

RULING:
The Supreme Court reversed and set aside the deicion of the Court
of Appeals and acquitted Caiz for failure of the prosecution to prove her
guilt beyond reasonable doubt.

The Court held that although it may be true that the place of
marking is not an essential element, the failure to establish with certainty
where the seized sachets were marked affects the integrity of the chain of
custody of the corpus delicti.

Marking after seizure is the starting point in the custodial link;

hence, it is vital that the seized contraband be immediately marked
because the succeeding handlers of the specimens will use the markings
as reference. The marking of the evidence serves to separate the marked
evidence from the corpus of all other similar or related evidence from the
time they are seized from the accused until they are disposed of at the end
of the criminal proceedings, thus, preventing switching, planting or
contamination of evidence.

Non-compliance is tantamount to failure in establishing identity of

the corpus delicti, an essential element of the offenses of illegal sale and
illegal possession of dangerous drugs. By failing to establish an element of
these offenses, non-compliance will, thus, engender the acquittal of an
accused.

381
382
 People of the Philippines, plaintiff-appellee, v. Danilo Feliciano, Jr., et
al., accused-appellants

G.R. No. 196735

03 August 2016

Leonen, J.

DOCTRINE:
The purpose of alleging all the circumstances attending a crime, including any
circumstance that may aggravate the accused’s liability, is for the accused to be
able to adequately prepare for his or her defense.

FACTS:
On November 26, 2010, the Supreme Court affirmed the decision of
the Court of Appeals convicting the accused-appellants for the murder of
Dennis Venturina, slight physical injuries in relation to private
complainants Lachica, Gaston, Jr., and Mangrobang Jr. all due to hazing.
However, on May 5, 2014, the Court modified its ruling and reinstated the
decision of the trial court which found the accused-appellants guilty of
attempted murder of the private complainants Lachica, Fortes, Nalaicio,
Gaston, Jr., and Mangrobang, Jr.

Accused-Appellants separately filed their respective Motions for

Reconsideration on the May 5, 2014 ruling.

Zingapan, one of the accused-appellants, argued the insufficiency of

the Information filed against him, which he argued that violated his
constitutional right to be informed of the nature and cause of the
accusation against him.

ISSUE:
Whether the Information filed against Zingapan is insufficient which
violated his constitutional right.

383
RULING:
The Supreme Court denied with finality the Motions for
Reconsideration filed by the accused-appellants including the Motion for
Reconsideration of Zingapan.

The Court held that the Information sufficiently alleged all the
circumstances attending the crime that may aggravate the accused’s
liability. The Information contained the allegation of aggravating
circumstance of “masks and/or other forms of disguise” to enable the
prosecution to prove how the witnesses were able to identify the attackers
despite the concealment of identity. In criminal cases, disguise is an
aggravating circumstance because, like nighttime, it allows the accused to
remain anonymous and unidentifiable as he carries out his crimes. The
introduction of the prosecution of testimonial evidence that tends to
prove that the accused were masked but the masks fell off does not
prevent them from including disguise as an aggravating circumstance.

384
 Banco de Oro, et al., petitioners v. Republic of the Philippines, et al.,
respondents

G.R. No. 198756

13 January 2015

Leonen, J.

DOCTRINE:
Exhaustion of Administrative Remedies; The remedy within the administrative
machinery must be resorted to first and pursued to its appropriate conclusion
before the court’s judicial power can be sought.

FACTS:
This is a Petition for Certiorari, Prohibition and/or Mandamus filed
by the petitioners under Rule 65 of the Rules of Court.

The case involves the proper tax treatment of the discount or

interest income arising from the P35 billion worth of 10-year zero-coupon
treasury bonds issued by the Bureau of Treasury. The Commission of
Internal Revenue issued BIR Ruling No. 370-2011 declaring that the
bonds, being deposit substitutes, are subject to the 20% final withholding
tax. Pursuant to this ruling, the Secretary of Finance directed the Bureau
of Treasury to withhold a 20% final tax from the face value of the bonds
upon their payment at maturity.

Petitioners contend that the retroactive application of the 2011 BIR

Ruling without prior notice to them was in violation of their property
rights, right to due process, as well as Sec. 246 of the National Internal
Revenue Code. And that the CIR gravely abused her discretion in the
exercise of her rule making power.

On the other hand, respondents argue that petitioners’ direct resort

to the Supreme Court to challenge the 2011 BIR Ruling violates the
doctrines of exhaustion of administrative remedies and hierarchy of

385
courts, resulting in lack of cause of action that justifies the dismissal of the
petition.

ISSUE:
Whether the petitioners violated the doctrine of exhaustion of
administrative remedies when it assailed the 2011 BIR Ruling before the
Supreme Court.

RULING:
The Supreme Court granted the petition and nullified the 2011 BIR
Ruling. The Supreme Court held that interpretative rulings of the BIR are
reviewable by the Secretary of Finance, nonetheless, jurisprudence allows
certain exceptions to the rule on exhaustion of administrative remedies:
The
doctrine of exhaustion of administrative remedies is a relative one and its
flexibility is called upon by the peculiarity and uniqueness of the factual
and circumstantial settings of a case. Hence, it is disregarded

(1) when there is a violation of due process,

(2) when the issue involved is purely a legal question,
(3) when the administrative action is patently illegal amounting to lack or
excess of jurisdiction,
(4) when there is estoppel on the part of the administrative agency
concerned,
(5) when there is irreparable injury,
(6) when the respondent is a department secretary whose acts as an alter
ego of the President bears the implied and assumed approval of the latter,
(7) when to require exhaustion of administrative remedies would be
unreasonable,
(8) when it would amount to a nullification of a claim, (9) when the
subject matter is a private land in land case proceedings, (10) when the
rule does not provide a plain, speedy and adequate remedy,
(11) when there are circumstances indicating the urgency of judicial
intervention.

386
 DEVELOPMENT BANK OF THE PHILIPPINES vs. CLARGES
CORPORATION, REALTY

RESPONDENT

G.R. No. 170060

August 17, 2016

Leonen, J.

DOCTRINE:
The admission of a third-party complaint lies within the sound discretion of the
trial court. If leave to file a third-party complaint is denied, then the proper
remedy is to file a separate case, not to insist on the admission of the third-party
complaint all the way up to this Court.

FACTS:

A property located somewhere in Makati was secured as a

mortgage by Marinduque Mining and Industrial Corporation to
Development Bank of the Philippines (petitioner). When Marinduque
failed to pay its loan obligations, the petitioner instituted foreclosure. It
then offered the property for public sale which was awarded to Clarges
Realty Corporation(respondent) as the highest bidder. However, the title
of the property contained annotations of tax lien in favor of Asset
Privatization Trust after the latter acquired the assets of the petitioner.
Clarges Realty then demanded for a clean title but was not given.
Respondent then filed a case in the RTC. Later on, the petitioner moved
for leave of court to file a third-party complaint. It sought to implead the
Asset Privatization Trust as a third-party defendant and maintained that
the Asset Privatization Trust had assumed the "direct and personal"
obligation to pay for Marinduque's tax liability and to have the partially

387
reduced tax lien cancelled. Respondent opposed the motion to leave
because it will entail delay and unnecessary costs especially that it has
already rested its case.

Trial court denied the leave of court ratiocinating that the petitioner
"should have impleaded the Asset Privatization Trust during the
preparation of its answer if indeed a third party is liable to it for
subrogation or other relief." The same was affirmed by the Court tof
Appeals.

ISSUE:

Whether or not there is grave abuse of discretion for refusing to admit

third-party complaint.

RULING:

NO. Rule 6, Section 11 of the Rules of Court governs the filing of third-
party complaints:

SEC. 11. Third, (fourth, etc.)-party complaint. - A third (fourth, etc.)-party

complaint is a claim that a defending party may, with leave of court, file
against a person not a party to the action, called the third (fourth, etc.)-
party defendant, for contribution, indemnity, subrogation or any other
relief, in respect of his opponent's claim. Based on this provision, the
Asset Privatization Trust would have been a valid third-party defendant.
As the trustee of the National Government to whom petitioner's assets
were transferred under Proclamation No. 50, the Asset Privatization Trust
acquired the liabilities attached to those assets. The tax lien over the
property here is one such liability, and petitioner may ask, as it did the
Asset Privatization Trust, for contribution for the payment of the unpaid
tax and the tax lien's consequent cancellation. However, the admission of

388
a third-party complaint requires leave of court; the discretion is with the
trial court. If leave is denied, the proper remedy is to file a complaint to be
docketed as a separate case. Hence, there was no grave abuse of discretion
in denying leave to admit the third-party complaint against the Asset
Privatization Trust. As the Court of Appeals observed, the trial court
would have wasted time and effort had it admitted the third-party
complaint. Respondent, the original plaintiff, had already rested its case
when the Motion for Leave was filed. The original case would have
dragged on with the addition of a new party at a late stage of the trial.

389
E.I. DUPONT DE NEMOURS AND CO. (ASSIGNEE OF INVENTORS
CARINI, DUNCIA AND

WONG) vs. DIRECTOR EMMA C. FRANCISCO

G.R. No. 174379

August 31, 2016

Leonen, J.

DOCTRINE:
If a petition fails to attach material portions of the record, it may still be given
due course if it falls under certain exceptions.

If an administrative agency's procedural rules expressly prohibit an intervention

by third parties, the prohibition is limited only to the proceedings before the
administrative agency. Once the matter is brought before the Court of Appeals in
a petition for review, any prior prohibition on intervention does not apply since
the only question to be determined is whether the intervenor has established a
right to intervene under the

Rules of Court.

FACTS:

Petitioner, an American corporation, filed a patent application for a

medicine (Losartan) related to the treatment of hypertension and
congestive heart failure.

However, it learned that its previous counsel has abandoned the

application before the Intellectual Property Office (IPO). It then executed
a Special Power of Attorney authorizing another counsel to prosecute and
handle its patent application. The petitioner filed a Petition for Revival for
the patent since it was not aware that the previous counsel has already
died. However, the same was denied by the Director of Patents for being

390
filed out of time. Upon appeal, the Director-General also affirmed the
resolution of the Director of Patents. Therefore, petitioner filed a Petition
for Review in the Court of Appeals seeking to set aside the decision of the
IPO. The Court of Appeals granted the petition for Revival. In the interim,
respondent moved for leave to intervene and argued that the Court of
Appeals directly affected its vested right to sell its own product by
allowing a Petition for Revival. The Court of Appeals then issued a
resolution granting the Motion to Intervene of the respondent it having an
interest in the revival of the patent application of the petitioner. Later on,
the Court of Appeals ruled that the revival of the application prejudiced
the respondent. Petitioner filed a Certiorari in the Court. The respondent,
however, argued that the petition for certiorari was not proper because it
failed to comply with Rule 45, section 4 of the Rules of Court when
petitioner failed to attach certain documents to support the allegations in
the complaint. On the other hand, the petitioner, argued that the Court of
Appeals erred in allowing the intervention of the respondent on appeal
since the revival of a patent application is ex parte and is "strictly a contest
between the examiner and the applicant"

ISSUES:

1. Whether or not the failure to attach certain documents in the petition

warrants dismissal.

2. Whether or not the Court of Appeals may resolve a motion for

intervention upon appeal

and that the disallowance of the same is consistent with the privacy of the
patent.

391
RULING:

1. NO. If a petition fails to attach material portions of the record, it may

still be given due course if it falls under certain exceptions. Although Rule
45, Section 4 of the Rules of Court requires that the petition "be
accompanied by ... such material portions of the record as would support
the petition," the failure to do so will not necessarily warrant the outright
dismissal of the complaint.

In Galvez v. CA, the Court ruled that:

First, not all pleadings and parts of case records are required to be
attached to the petition. Only those which are relevant and pertinent must
accompany it. The test of relevancy is whether the document in question
will support the material allegations in the petition, whether said
document

will make out a prima facie case of grave abuse of discretion as to

convince the court to give due course to the petition.

Second, even if a document is relevant and pertinent to the petition, it

need not be appended if it is shown that the contents thereof can also [sic]
found in another document already attached to the petition. Thus, if the
material allegations in a position paper are summarized in a questioned

judgment, it will suffice that only a certified true copy of the judgment is
attached.

Third, a petition lacking an essential pleading or part of the case record

may still be given due course or reinstated (if earlier dismissed) upon
showing that petitioner later submitted the documents required, or that it
will serve the higher interest of justice that the case be decided on the
merits.

In this case, petitioner attached the Court of Appeals Decision dated

August 31, 2004, the Resolution dated January 31, 2006, and the Amended

392
Decision dated August 30, 2006. The Court of Appeals Resolution and
Amended Decision quoted extensive portions of its rollo in support of its
rulings.These conclusions were sufficient to convince this Court not to
outright dismiss the Petition but to require respondents to first comment
on the Petition, in satisfaction of the first and second procedural
guideposts in Magsino.

2. NO. Rule 19 of the Rules of Court provides that a court has the
discretion to determine

whether to give due course to an intervention. Rule 19, Section 1 states:

SECTION 1. Who may intervene. -A person who has a legal interest in the
matter in litigation, or in the success of either of the parties, or an interest
against both, or is so situated as to be adversely affected by a distribution
or other disposition of property in the custody of the court or of an officer
thereof may, with leave of court, be allowed to intervene in the action.
The court shall consider whether or not the intervention will unduly
delay or prejudice the adjudication of the rights of the original parties,
and whether or not the intervenor's rights may be fully protected in a
separate proceeding. If an administrative agency's procedural rules
expressly prohibit an intervention by third parties, the prohibition is
limited only to the proceedings before the administrative agency. Once
the matter is brought before the Court of Appeals in a petition for review,
any prior prohibition on intervention does not apply since the only
question to be determined is whether the intervenor has established a
right to intervene under the Rules of Court.

In this case, respondent Therapharma, Inc. was able to show that it had
legal interest to intervene in the appeal of petitioner's revival of its patent
application. While its intervention may have been premature as no patent

393
has been granted yet, petitioner's own actions gave rise to respondent
Therapharma, Inc.' s right to protect its losartan product. Moreover, it was
inaccurate for petitioner to argue that secrecy in patent applications
prevents any intervention from interested parties. The confidentiality in
patent applications under the Intellectual Property Code is not absolute
since a party may already intervene after the publication of application.

394
 PHILIPPINE NATIONAL BANK v. HEIRS OF THE LATE IRENEO
AND

CARIDAD ENTAPA

G.R. No. 215072

September 07, 2016

Leonen, J.

DOCTRINE:
The Constitution requires that a court must state the factual and legal grounds
on which its decisions are based. Any decision that fails to adhere to this mandate
is void.

Obiter dictum is "an opinion expressed by a court upon some question of law
which is not necessary to the decision of the case before it.

FACTS:

Caridad Entapa (respondent) owned a lot. It authorized Joseph

Gonzaga to enter into legal transactions in their behalf. Gonzage executed
a real mortgage property over the lot to Philippine National Bank
(petitioner) to guarantee his loan. He defaulted that is why the petitioner
foreclosed and sold the property at a public auction. Rosario Entapa
Orpeza thereafter made a restructuring with the PNB to repurchase the
property. She paid the down payment only to found out that the property
was occupied already and was covered by the Comprehensive Agrarian
Reform Program. Orpeza then demanded that her down payment be
returned. The Regional Trial Court then rendered a decision against the
petitioner. The petitioner appealed contending that the decision failed to
state its legal basis. The Court of Appeals nullified the Regional Trial
Court decision and remanded the case for rendition of judgment based on
the Constitution and Rules of Court. However, the petitioner alleged that

395
despite the case being remanded, the Court of Appeals still ruled that it is
still liable to respondent.

ISSUES:

1. Whether or not the decision of the RTC has no legal basis.

2. Whether or not the CA ruled on the merits of the case.

RULING:

1) YES. Court must state the factual and legal basis for its decisions;
otherwise, its decisions are void.

Article VIII, Section 14 of the Constitution provides:

SECTION 14. No decision shall be rendered by any court without

expressing therein clearly and distinctly the facts and the law on which it
is based.

No petition for review or motion for reconsideration of a decision of the

court shall be refused due course or denied without stating the legal basis
therefor.

Likewise, Rule 36, Section 1 of the Rules of Court provides:

SECTION 1. Rendition of judgments and final orders. — A judgment or

final order determining the merits of the case shall be in writing
personally and directly prepared by the judge, stating clearly and
distinctly the facts and the law on which it is based, signed by him, and
filed with the clerk of the court.

The trial court failed to cite any legal basis for declaration of petitioner's
liability. The Decision merely contained a recitation of facts and a
dispositive portion.

396
The constitutional requirement that the basis of the decision of our courts
should be clearly articulated and made legible to the parties does not
merely assure fairness. It is likewise crucial to assure the public that the
judiciary arrives at its conclusions on the basis of reasonable inference

from credible and admissible evidence and the text of law and our
jurisprudence. Decisions of all courts should not be based on any other
considerations. Not only will fully coherent and cogent reasons have
greater chances to convince the litigants of their chances on appeal; they
also make

appeals possible. After all, appellate courts cannot be assumed to have so

much omniscience that they can read what the trial judge has not written.

2) NO. Nothing in the Court of Appeals Decision ordered petitioner to

return to respondents their down payment and pay them damages.

Strangely, petitioner now comes before this Court and argues that the
Court of Appeals should not have adjudicated on the arguments that it
had raised before it. Even if the Court of Appeals had adjudicated upon
the merits of the case, any discussion would have been considered obiter
dictum since the entire case was remanded to the trial court. Obiter
dictum is “an opinion expressed by a court upon some question of law
which is not necessary

to the decision of the case before it.” It is a "a remark made, or opinion
expressed upon a point not necessarily involved in the determination of
the cause, or introduced by way of illustration, or analogy or argument.”
It “lacks the force of an adjudication and should not ordinarily be
regarded

as such.”

397
 NATIONAL POWER CORPORATION vs. SPS. MARGARITO
ASOQUE AND TARCINIA

ASOQUE

G.R. No. 172507

September 14, 2016

Leonen, J.

DOCTRINE:
Article III, Section 91 of the Constitution provides a substantive guarantee that
private property that is taken by the state for public use should be paid for with
just compensation. If the state does not agree with the property owner on a price,
the state, through the competent government agency, should file the proper
expropriation action under Rule 67 of the Revised Rules of Court. In case of a
taking without the proper expropriation action filed, the property owner may file
its own action to question the propriety of the taking or to compel the payment of
just compensation. Among these inverse condemnation actions is a complaint for
payment of just compensation and damages. When an inverse condemnation is
filed, the provisions for the appointment of commissioners under Rule 32— not
Sections 5, 6, 7, or 8 of Rule 67 of the Rules of Court—will be followed.

FACTS:

Spouses Asoque are the registered owners of a parcel of coconut

land located in Barangay Bugtong, Calbayog City. Sometime in
November 1995, the National Power Corporation entered the Spouses
Asoque's land to install transmission lines. In the process, there were
damages incurred as a result of the National Power Corporation's cutting
off some coconut trees and other fruit- and non-fruit-bearing plants
during the construction. They were also prohibited from introducing on
the 4,352-square-meter area any improvement that could rise by a few

398
meters from the ground. Upon Spouses Asoque's demand for just
compensation, the National Power Corporation only paid for the
improvements destroyed and refused to pay for the actual value of the
4,352-square-meter area utilized for the project. The National Power
Corporation claimed that it was only liable to pay for right of way at 10%
of the market value under Section 3-A of Republic Act No. 6395 On
September 20, 1999, Spouses Asoque filed before the Regional Trial Court
of Calbayog City a Complaint for payment of just compensation and
damages against the National Power Corporation.

In its Answer dated February 7, 2000, the National Power Corporation

denied Spouses Asoque's claims that it had illegally utilized their
property. It alleged that it entered the property with Spouses Asoque's
consent, as shown by the acknowledgment receipt for P9,897.00 as
payment for damaged improvements and waiver of claims to
improvements damaged. By virtue of the acknowledgement receipt and
the waiver, the National Power Corporation claimed that there was no
more need for it to institute an expropriation proceeding. When Civil
Case No. 737 was called for pre-trial on May 8, 2000, the case was ordered
dismissed by the trial court due to the non-appearance of both parties and
their counsel. However, the case was reinstated after Spouses Asoque's
counsel explained to the trial court the reason why he arrived late. The
pre-trial of the case was reset to May 24, 2000. On May 24, 2000, the trial
court, noting the absence of the National Power Corporation and its
counsel, allowed Spouses Asoque to present their evidence ex parte
before a court-appointed

Commissioner. It simultaneously dismissed the National Power

Corporation's counterclaim.

On June 6, 2000, the trial court denied National Power Corporation's

Urgent Manifestation and Motion to Reset Pre-trial, finding it to have

399
been filed out of time and also moot and academic. Its motion for
reconsideration was likewise denied. On June 22, July 24 and August 28,
2000, Spouses Asoque presented evidence ex parte before Atty. Ferdinand
S. Arpon, Branch Clerk of Court, who was appointed Commissioner by
the trial court.

Eventually, the Regional Trial Court rendered a decision in favor of the

spouses.

The respondent argued that the allowance to present evidence ex parte

and appointment of the Branch of Clek of Court as the Commissioner is
an irregularity. Nonetheless, the Court of Appeals affirmed the decision
of the lower court. Hence, this petition.

ISSUE:

1. Whether or not presentation by the petitioner of evidence ex parte is

proper.

2. Whether or not the appointment of clerk of court as commissioner is

proper.

RULING:

1) YES. The Regional Trial Court did not err in allowing respondents to
present their evidence ex parte. The action of the trial court is expressly
allowed under Rule 18, Section 5 of the 1997 Rules of Civil Procedure.
Section 5 provides that if it is the defendant who fails to appear, then the
plaintiff may be allowed "to present his evidence ex parte and the court to
render judgment on the basis thereof." Petitioner's stance that it was
deprived of due process

400
because it was not given the reasonable opportunity to attend the second
pre-trial setting is likewise untenable.

Petitioner and its counsel were absent during the first pre-trial setting on
May 8, 2000. Respondents' counsel attended, although he was late. Had
petitioner and its counsel appeared on the first setting, they would have
been reasonably notified then and there of the second pre-trial resetting
on May 24, 2000 and would have had the opportunity to ask for a later
date.

Nonetheless, petitioner's counsel should have tried to inquire from the

court the next schedule of the pre-trial. Attendance by the party and its
counsel during a pre-trial conference is mandatory as expressly stated
under Rule 18, Section 4 of the 1997 Rules of Civil Procedure.70 Petitioner
alleges that it filed a motion for postponement of the first pre-trial setting.

This notwithstanding, it was still its duty to appear at the pre-trial first set
on May 8, 2000. A motion for postponement should never be presumed to
be grant Under the circumstances, petitioner cannot claim that it was
denied due process. “Parties are presumed to have known the governing
rules and the consequences for the violation of such rules.” Moreover, the
essence of due process is an opportunity to be heard. Petitioner was given
that opportunity. Yet, it failed to appear at the two (2) pre-trial settings. A
pre-trial cannot be taken for granted for it serves a vital objective: the
simplification and expedition of the trial, if not its dispensation. Non-
appearance of a party may only be excused for a valid cause. We see none
in this case.

401
2) YES. The procedure of designating the clerk of court as commissioner
to receive and report evidence to the court is likewise sanctioned by Rule
32, Sections 2 and 3 of the 1997 Rules of Civil Procedure. Section 3 of the
same Rule, speaking of the authority that may be granted to a
Commissioner, provides:

SEC. 3. Order of reference; powers of the commissioner. — When a

reference is made, the clerk shall forthwith furnish the commissioner with
a copy of the order of reference. The order may specify or limit the
powers of the commissioner, and may direct him to report only upon
particular issues, or to do or perform particular acts, or to receive and
report evidence only, and may fix the date for beginning and closing the
hearings and for the filing of his report. Subject to the specifications and
limitations stated in the order, the commissioner has and shall exercise
the power to regulate the proceedings in every hearing before him and to
do all acts and take all measures necessary or proper for the efficient
performance of his duties under the order. He may issue subpoenas and
subpoenas duces tecum, swear witnesses, and unless otherwise provided
in the order of reference, he may rule upon the admissibility of evidence.
The trial or hearing before him shall proceed in all respects as it would if
held before the court. Furthermore, after the hearing before the
Commissioner, the Commissioner must file a written report, which may
contain his or her factual findings and conclusions of law

SEC. 9. Report of commissioner. - Upon the completion of the trial or

hearing or proceeding before the commissioner, he shall file with the
court his report in writing upon the matters submitted to him by the
order of reference. When his powers are not specified or limited, he shall
set forth his findings of fact and conclusions of law in his report. He shall
attach thereto all exhibits, affidavits, depositions, papers and the

402
transcript, if any, of the testimonial evidence presented before him.
Hence, absent any express limitation in the order of reference, Branch
Clerk of Court Arty. Ferdinand S. Arpon, as the court appointed
Commissioner, may make factual findings and recommendations on the
valuation of the property. Indeed, the Commissioner's recommendation

could have been necessarily rejected had it been an ultra vires act.

403
 RIZALITO Y. DAVID v. SENATE ELECTORAL TRIBUNAL AND

MARY GRACE POE-LLAMANZARES

G.R. No. 221538

September 20, 2016

Leonen, J.

DOCTRINE:
The term "grave abuse of discretion" has been generally held to refer to such
arbitrary,capricious, or whimsical exercise of judgment as is tantamount to lack
of jurisdiction. [T]he abuse of discretion must be patent and gross as to amount to
an evasion of a positive duty or 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 and hostility. Mere abuse of
discretion is not enough: itmust be grave.

FACTS:

Rizalito David (petitioner) filed a case for quo warranto. However,

the Senate Electoral Tribunal (SET) dismissed the Petition for Quo
Warranto filed by David, which sought to unseat private respondent
Mary Grace Poe-Llamanzares as a Senator for allegedly not being a
natural-born citizen of the Philippines and, therefore, not being qualified
to hold such office.

ISSUE:

Whether or not the Senate Electoral Tribunal committed grave abuse of

discretion mounting to lack or excess of jurisdiction in dismissing
petitioner's Petition for Quo Warranto based on its finding that private

404
respondent is a natural-born Filipino citizen, qualified to hold a seat as
Senator under Article VI, Section 3 of the 1987 Constitution.

RULING:

NO. A party aggrieved by the rulings of the Senate or House Electoral

Tribunal invokes the jurisdiction of this Court through the vehicle of a
petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure.
An appeal is a continuation of the proceedings in the tribunal from which
the appeal is taken. A petition for certiorari is allowed in Article VIII,
Section 1 of the Constitution

and described in the 1997 Rules of Civil Procedure as an independent civil

action. The viability of such a petition is premised on an allegation of
“grave abuse of discretion.” The term “grave abuse of discretion” has
been generally held to refer to such arbitrary, capricious, or whimsical
exercise of judgment as is tantamount to lack of jurisdiction. [T]he abuse
of discretion must be patent and gross as to amount to an evasion of a
positive duty or 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 and hostility. Mere
abuse of discretion is not enough: it must be grave.

There is grave abuse of discretion when a constitutional organ such as the

Senate Electoral Tribunal or the Commission on Elections, makes
manifestly gross errors in its factual inferences such that critical pieces of
evidence, which have been nevertheless properly introduced by a party,
or admitted, or which were the subject of stipulation, are ignored or not
accounted for. A glaring misinterpretation of the constitutional text or of
statutory provisions, as well as a misreading or misapplication of the
current state of jurisprudence, is also considered grave abuse of

405
discretion. The arbitrariness consists in the disregard of the current state
of our law. In this case, the Court, however, find no basis for concluding
that the Senate Electoral Tribunal acted without or in excess of
jurisdiction, or with grave abuse of discretion amounting to lack or excess
of jurisdiction. The Senate Electoral Tribunal's conclusions are in keeping
with a faithful and exhaustive reading of the Constitution, one that
proceeds from an intent to give life to all the aspirations of all its
provisions.

Acting within this void, the Senate Electoral Tribunal was only asked to
make a reasonable interpretation of the law while needfully considering
the established personal circumstances of private respondent. It could not
have asked the impossible of private respondent, sending her on a
proverbial fool's errand to establish her parentage, when the controversy
before it arose because private respondent's parentage was unknown and
has remained so throughout her life.

In the process, it avoided setting a damning precedent for all children

with the misfortune of having been abandoned by their biological
parents.

Far from reducing them to inferior, second-class citizens, the Senate

Electoral Tribunal did justice to the Constitution's aims of promoting and
defending the well-being of children, advancing human rights, and
guaranteeing equal protection of the laws and equal access to
opportunities for public service.

406
 PABLO M. PADILLA, JR. AND MARIA LUISA P. PADILLA vs.
LEOPOLDO MALICSI, LITO

CASINO, AND AGRIFINO GUANES

G.R. No. 201354

September 21, 2016

Leonen, J.

DOCTRINE:
Parties must demonstrate by convincing evidence that the case clearly falls under
the exceptions to the rule. However, that the findings of the Court of Appeals and
of the trial court are opposite does not warrant this Court's automatic review of
factual findings. This only presents a prima facie basis for recourse to this Court.

FACTS:

Spouses Padilla (petitioners) bought a parcel of land in Cabanatuan

City in 1988. However,they discovered that the respondents constructed
houses on their lot. They made repeated demand for respondents to
vacate but they latter refused.

Hence, the petitioners filed a complaint for recovery of possession against

the respondents. Respondents answered that they believed in all honesty
and good faith that the lot belonged to Toribia Vda. De Mossessgeld (De
Mossessgeld). They claimed that they possessed the land and built their
houses on the lot only after receiving De Mossessgeld's permission. The
Regional Trial Court ruled that the respondents are not builders in good
faith. However, the Court of Appeals set aside the Regional Trial Court
decision.

407
ISSUE:

Whether or not the Court of Appeals erred in reversing the trial court's
finding that respondents were not builders in good faith

RULING:

NO. The Rules of Court categorically states that a review of appeals filed
before this Court is "not a matter of right, but of sound judicial
discretion."

The Rules of Court further requires that only questions of law should be
raised in petitions filed under Rule 4533 since factual questions are not the
proper subject of an appeal by certiorari. It is not this Court's function to
analyze or weigh all over again evidence that has already been considered
in the lower courts. However, these rules admit exceptions. Medina v.
Mayor Asistio, Jr.35 lists down 10 recognized exceptions:

(1) When the conclusion is a finding grounded entirely on speculation,

surmises or conjectures;

(2) When the inference made is manifestly mistaken, absurd or

impossible;

(3) Where there is a grave abuse of discretion;

(4) When the judgment is based on a misapprehension of facts;

(5) When the findings of fact are conflicting;

(6) When the Court of Appeals, in making its findings, went beyond the
issues of the case and the same is contrary to the admissions of both
appellant and appellee;

408
(7) The findings of the Court of Appeals are contrary to those of the trial
court;

(8) When the findings of fact are conclusions without citation of specific
evidence on which they are based;

(9) When the facts set forth in the petition as well as in the petitioner's
main and reply briefs are not disputed by the respondents; and

(10) The finding of fact of the Court of Appeals is premised on the

supposed absence of evidence and is contradicted by the evidence on
record. Pascual v. Burgos instructs that parties must demonstrate by
convincing evidence that the case clearly falls under the exceptions to the
rule. Parties praying that this court review the factual findings of the
Court of Appeals must demonstrate and prove that the case clearly falls
under the exceptions to the rule. They have the burden of proving to this
court that a review of the factual findings is necessary. Mere assertion and
claim that the case falls under the exceptions do not suffice. However, that
the findings of the Court of Appeals and of the trial court are opposite
does not warrant this Court's automatic review of factual findings. This
only presents a prima facie basis for recourse to this Court. Fernan v.
Court of Appeals cautions that this Court's review of the factual findings
of the lower courts "must be invoked and applied only with great
circumspection and upon a clear showing that manifestly correct findings
have been unwarrantedly rejected or reversed." A careful study of the
records leads this Court to conclude that this case falls under the
exceptions cited in Medina, particularly in that “the inference made is
manifestly mistaken”; and that “[t]he findings of the Court of Appeals are
contrary to those of the trial court, necessitating a review of the question
of fact raised before this Court.”

409
 Ruel Tuanoy Hernandez vs. People of the Philippines

G.R. No. 205871

September 28, 2016

Leonen, J.
DOCTRINE:
As officers of the court and as protectors of the legal interests of their clients,
counsels have a duty to properly act in case of their clients' death by notifying the
Court of this development.

FACTS:

Accused Ruel Tuano y Hernandez was charged with violation of

Article II, Section 11(3) of Republic Act No. 9165 for having in his
possession one (1) heat-sealed transparent plastic sachet with 0.064 grams
of shabu.

After trial on the merits, the Regional Trial Court convicted accused. On
appeal, the Court of Appeals affirmed in toto the ruling of the Regional
Trial Court.

On June 27, 2016, this Court issued the Resolution reconsidering its June
23, 2014 unsigned Resolution. This Court acquitted accused for failure of
the prosecution to prove his guilt beyond reasonable doubt.

Thus, an Order of Release was issued and sent to the Director of the
Bureau of Corrections. On July 22, 2016, this Court received from the
Director General of the Bureau of Corrections a letter dated July 15, 2016
informing this Court that accused died on March 1, 2015, prior to the
issuance of this Court's June 27, 2016 Resolution. A certified machine copy
of accused's Death Certificate was attached to the letter.

On August 22, 2016, this Court received a memorandum from the

Division Clerk of Court requesting instructions on the proper date of

410
finality of this Court's June 27, 2016 Resolution, in light of accused's death
prior to the Resolution's issuance.

ISSUE:
Whether or not counsels of the accused were at fault.

RULING: YES

This Court notes that counsels for accused should have informed this
Court of the death of their client.

Rule 3, Section 16 of the Rules of Court provides that the counsel is duty-
bound to report the death of a party to the court.

Although Rule 3, Section 16 of the Rules of Court is directly applied more

often in civil actions for the substitution of the deceased party, the rule
that the counsel of the deceased party must inform the court of the death
of his or her client also properly applies in criminal actions. Regardless of
the nature of the action, courts cannot be expected to assume the death of
the party without the counsel's proper manifestation. Furthermore, the
rules presume that "the attorney for the deceased party is in a better
position than the attorney for the adverse party to know about the death
of his [or her] client[.]"

Counsels for accused were grossly remiss in this duty. Accused died on
March 1, 2015. However, his counsels continued to file pleadings on his
behalf, including a Motion for Extension of Time to File Reply dated
September 16, 2015 and a Reply dated September 22, 2015. It was only
through the July 15, 2016 letter of the Director General of the Bureau of
Corrections did this Court find out that accused had already died:—one
(1) year, four (4) months, and 15 days after its occurrence.

411
Republic of the Philippines vs. Sandiganbayan, Ferdinand “BongBong”
Marcos Jr. Et. Al.

G.R. No. 195295

October 5, 2016

Leonen, J.

DOCTRINE:
The procedural rule, which requires that amendments to a pleading be indicated
with appropriate marks, has for its purpose the convenience of the Court and the
parties. It allows the reader to be able to immediately see the modifications.
However, failure to use the appropriate markings for the deletions and
intercalations will not affect any substantive right. Certainly, its absence cannot
cause the denial of any substantive right.

FACTS:

Respondents Ferdinand "Bongbong" R. Marcos, Jr. (Marcos, Jr.),

Maria Imelda R. Marcos (Imee), and Irene Marcos Araneta (Irene) appear
to be the registered owners of a parcel of land located in the Municipality
of Cabuyao, Laguna (Cabuyao property). Republic of the Philippines,
through the Presidential Commission on Good Government, filed before
the Sandiganbayan a Complaint for reversion, reconveyance, restitution,
accounting, and damages against Former President Marcos, Imelda R.
Marcos, their children, Marcos, Jr., Imee, and Irene, and their sons-in-law,
Tomas Manotoc and Gregorio Ma. Araneta III. The Complaint principally
sought to recover ill-gotten wealth acquired by the Marcoses during their
incumbency as public officers in active collaboration with their cronies,
dummies, and close business associates.

412
Respondents argue that the Petition should be dismissed outright for
procedural defects. They stress that the denial of the Motion to Admit the
Fourth Amended Complaint has attained finality. Further, the annotation
of the notice of lis pendens was improper as the Civil Case did not affect
the Cabuyao property. The properties involved in the Civil Case were
enumerated in the Complaint and made no mention of the Cabuyao
property. That the property is not part of the res in Civil Case No. 0002 is
apparent from petitioner's failure to adduce any evidence involving the
Cabuyao property during the trial of the case.

Additionally, respondents claim that the petitioner is not entitled to the

preliminary remedy of attachment, there being no factual allegations
showing the ground relied upon exists.

ISSUE:

Whether or not the Sandiganbayan was correct in denying the motion for
leave to amend.

RULING: NO

The Sandiganbayan's denial was primarily based on a purported failure

to comply with a requirement under Rule 10, Section 7 of the Rules of
Court, that amendments in a pleading be indicated by appropriate marks.

The procedural rule, which requires that amendments to a pleading be

indicated with appropriate marks, has for its purpose the convenience of
the Court and the parties. It allows the reader to be able to immediately
see the modifications. However, failure to use the appropriate markings
for the deletions and intercalations will not affect any substantive right.
Certainly, its absence cannot cause the denial of any substantive right.

413
More importantly, a reading of the Fourth Amended Complaint reveals
that the Sandiganbayan's observation was patently wrong. Petitioner did
not fail to comply with Rule 10, Section 7 of the Rules of Court. There
were no portions in the body of the Fourth Amended Complaint itself
that needed to be underscored or marked, considering that the text was
identical to the text of the admitted Complaint. Annex A to the Fourth
Amended Complaint, the List of Assets and Other Properties of
Ferdinand E. Marcos, Imelda R. Marcos and Immediate Family, reveals
that it was amended to include the Cabuyao property in the list of assets.
That entry was underscored to reflect the amendment.

The allegations in the admitted Complaint fall within Section 1(b) and (c)
of Rule 57. Given the peculiarities of the Marcos cases, the allegations of
Former President Marcos taking advantage of his powers as President,
gravely abusing his powers under martial law, and embarking on a
systematic plan to accumulate ill-gotten wealth suffice to constitute the
case as one under Rule 57. The allegation that the Cabuyao property was
registered under the names of respondents—minors at the time of
registration—is sufficient to allege that the Cabuyao property was
concealed, thus satisfying Rule 57, Section 1(c) of the Rules of Court.

The Sandiganbayan should have issued an order of preliminary

attachment considering that the requisites of the law—including that of
Executive Order No. 14—have been substantially met, and that there is
factual basis for the issuance of the preliminary attachment. The
Sandiganbayan committed grave abuse of discretion in denying
petitioner's Motion for issuance of a writ of preliminary attachment.

414
 Philippine Associated Smelting and Refining Corporation vs. Pablito
O. Lim, Et. Al.

G.R. No. 172948

October 5, 2016

Leonen, J.

DOCTRINE:
An action for injunction filed by a corporation generally does not lie to prevent
the enforcement by a stockholder of his or her right to inspection.

FACTS:

Philippine Associated Smelting and Refining Corporation (hereafter

PASAR) is a corporation duly organized and existing under the laws of
the Philippines and is engaged in copper smelting and refining. On the
other hand, Pablito Lim, Manuel Agcaoili and Consuelo Padilla
(collectively referred to as petitioners) were former senior officers and
presently shareholders of PASAR holding 500 shares each.

An Amended Petition for Injunction and Damages with prayer for

Preliminary Injunction and/or Temporary Restraining Order was filed by
PASAR seeking to restrain petitioners from demanding inspection of its
confidential and inexistent records.

ISSUE:

Whether or not injunction properly lies to prevent respondents from

invoking their right to inspect.

415
RULING: NO

For an action for injunction to prosper, the applicant must show the
existence of a right, as well as the actual or threatened violation of this
right. Thus, an injunction must fail where there is no clear showing of
both an actual right to be protected and its threatened violation, which
calls for the issuance of an injunction.

The Corporation Code provides that a stockholder has the right to inspect
the records of all business transactions of the corporation and the minutes
of any meeting at reasonable hours on business days. The stockholder
may demand in writing for a copy of excerpts from these records or
minutes, at his or her expense.

416
 Crisanto M. Aala vs. Rey T. Uy

G.R. No. 202781

January 10, 2017

Leonen, J.

DOCTRINE:
In a fairly recent case, we summarized other well-defined exceptions to the
doctrine on hierarchy of courts. Immediate resort to this Court may be allowed
when any of the following grounds are present: (1) when genuine issues of
constitutionality are raised that must be addressed immediately; (2) when the
case involves transcendental importance; (3) when the case is novel; (4) when the
constitutional issues raised are better decided by this Court; (5) when time is of
the essence; (6) when the subject of review involves acts of a constitutional organ;
(7) when there is no other plain, speedy, adequate remedy in the ordinary course
of law; (8) when the petition includes questions that may affect public welfare,
public policy, or demanded by the broader interest of justice; (9) when the order
complained of was a patent nullity; and (10) when the appeal was considered as
an inappropriate remedy.

The doctrine of exhaustion of administrative remedies, like the doctrine on

hierarchy of courts, is not an iron-clad rule. It admits of several well-defined
exceptions. Province of Zamboanga del Norte v. Court of Appeals has held that
the principle of exhaustion of administrative remedies may be dispensed in the
following instances:

(1) [W]hen there is a violation of due process; (2) when the issue involved is
purely a legal question; (3) when the administrative action is patently illegal and
amounts to lack or excess of jurisdiction; (4) when there is estoppel on the part of
the administrative agency concerned; (5) when there is irreparable injury; (6)
when the respondent is a department secretary whose acts, as an alter ego of the
President, bears the implied and assumed approval of the latter; (7) when to

417
require exhaustion of administrative remedies would be unreasonable; (8) when it
would amount to a nullification of a claim; (9) when the subject matter is a
private land in land case proceedings; (10) when the rule does not provide a plain,
speedy and adequate remedy; (11) when there are circumstances indicating the
urgency of judicial intervention; and unreasonable delay would greatly prejudice
the complainant; (12) when no administrative review is provided by law; (13)
where the rule of qualified political agency applies; and (14) when the issue of
non-exhaustion of administrative remedies has been rendered moot.

FACTS:

Petitioners also believe that upon receipt of an assessment, they

would be precluded from questioning the excessiveness of the real
property tax imposed by way of protest. Under the Local Government
Code of 1991, the amount of real property tax assessed must first be paid
before a protest may be entertained. However, petitioners contend that
the taxpayers of Tagum City would not be able to comply with this rule
due to lack of money. Petitioners justify immediate resort to this Court
due to this impasse.

In their Comment, respondents attack the propriety of the remedy of

which petitioners have availed themselves. Respondents point out that
the extraordinary remedy of certiorari is only directed against judicial and
quasi-judicial acts. According to respondents, the Sangguniang
Panlungsod of Tagum City exercised a legislative function in enacting the
questioned ordinance and is, thus, beyond the scope of a petition for
certiorari. Moreover, there is a plain, speedy, and adequate remedy
available to petitioners under the law. Citing Section 187 of the Local
Government Code of 1991, respondents argue that petitioners should
have exhausted administrative remedies by filing an appeal before the
Secretary of Justice.

418
Respondents further argue that in directly filing their Petition before this
Court, petitioners violated the doctrine on hierarchy of courts. They stress
that the Supreme Court, Court of Appeals, and the Regional Trial Courts
have concurrent jurisdiction to issue writs of certiorari, prohibition, and
mandamus.

ISSUE:

Whether or not this case falls under the exceptions to the doctrine on
hierarchy of courts and to the rule on exhaustion of administrative
remedies.

RULING: NO

However, the doctrine on hierarchy of courts is not an inflexible rule. In

Spouses Chua v. Ang, this Court held that "[a] strict application of this
rule may be excused when the reason behind the rule is not present in a
case[.]"This Court has recognized that a direct invocation of its original
jurisdiction may be warranted in exceptional cases as when there are
compelling reasons clearly set forth in the petition, or when what is raised
is a pure question of law.

(Refer to doctrine mentioned above for enumeration of exception to Doctrine of

Hierarchy of Courts)

None of the exceptions to the doctrine on hierarchy of courts are present

in this case. Significantly, although petitioners raise questions of law,
other interrelated factual issues have emerged from the parties'
arguments, which this Court deems indispensable for the proper
disposition of this case.

The doctrine of exhaustion of administrative remedies, like the doctrine

on hierarchy of courts, is not an iron-clad rule. It admits of several well-

419
defined exceptions. Province of Zamboanga del Norte v. Court of Appeals
has held that the principle of exhaustion of administrative remedies may
be dispensed in the following instances: (Refer to doctrine mentioned above
for enumeration of exception to rule on Adminstrative Remedies.)

In this case, however, the issues involved are not purely legal. There are
factual issues that need to be addressed for the proper disposition of the
case. In other words, this case is still not ripe for adjudication.

Given the serious procedural errors committed by petitioners, we find no

genuine reason to dwell on and resolve the other issues presented in this
case. The factual issues raised by petitioners could have been properly
addressed by the lower courts had they adhered to the doctrines of
hierarchy of courts and exhaustion of administrative remedies. These
rules were established for a reason. While petitioners' enthusiasm in their
advocacy may be admirable, their overzealousness has further delayed
their cause.

420
 Heirs of Loyola, presented herein by Zosimo L. Mendoza vs. Court of
Appeals

G.R. No. 188658

January 11, 2017

Leonen, J.

DOCTRINE:
As a general rule, only matters assigned as errors in the appeal may be resolved.
Rule 51, Section 8 of the Rules of Court provides: xxx

This provision likewise states that the Court of Appeals may review errors that
are not assigned but are closely related to or dependent on an assigned error. The
Court of Appeals is allowed discretion if it "finds that their consideration is
necessary in arriving at a complete and just resolution of the case."

FACTS:

The Regional Trial Court did not rule on the merits. Instead, it
dismissed the case without prejudice for failure to implead an
indispensable party. The trial court found that the successors of one of the
heirs, Guillermo Mendoza (Zosimo's deceased brother), were not
impleaded as party-plaintiffs.

The Court of Appeals found that the Regional Trial Court erred in finding
that there was a failure to implead an indispensable party as the heirs of
Guillermo Mendoza were not indispensable parties and judgment could
be rendered without impleading them as party-plaintiffs. Nevertheless,
the Court of Appeals found that the evidence presented by the Heirs was
insufficient to overcome the presumption of regularity of the free patent

421
and original certificate of title issued to Alicia. It found that the Heirs
failed to submit evidence showing that Teodora alone inherited the
property when testimonies revealed that she had a brother. Likewise, they
failed to prove that they were legally related to or were the only heirs of
Teodora. They did not even prove that she had died, and that she had the
power to validly transmit rights over the property to them.

Petitioners claim that the Court of Appeals committed grave abuse of

discretion amounting to lack or excess of jurisdiction in going beyond the
issues raised on appeal. They claim that the Court of Appeals touched on
the factual findings of the Regional Trial Court although these were not
even contested by respondent. They insist that their appeal focused only
on the procedural aspect of jurisdiction over indispensable parties. Thus,
the Court of Appeals should have ruled on this matter alone. Petitioners
assert that in any case, they have convincingly proven their claim and
allegations as to their rights over the land and that the patent issued to
respondent is null and void.

ISSUE:

Whether or not the Court of Appeals gravely abused its discretion when it
went beyond the issue of dismissal and ruled on the sufficiency of
petitioners' evidence before the Regional Trial Court

RULING: NO

Court of Appeals has the discretion to consider the issue and address the
matter where its n1ling is necessary (a) to arrive at a just and complete
resolution of the case; (b) to serve the interest of justice; or (c) to avoid
dispensing piecemeal justice. This is consistent with its authority to
review the totality of the controversy brought on appeal.

422
Petitioners' appeal primarily focused on the Regional Trial Court's
dismissal of the Complaint for failure to implead an indispensable party.
Nonetheless, the Court of Appeals correctly ruled on whether petitioners
were able to prove their claim. It had the discretion to properly consider
this separate issue in order to arrive at a complete resolution of the case.

Ordinarily, this case should have been remanded to the Regional Trial
Court to make the proper factual determination. However, due to judicial
economy, or "the goal to have cases prosecuted with the least cost to the
parties," the Court of Appeals correctly reviewed the case in its entire
context.

Petitioners prayed that the Court of Appeals rule on both the procedural
and substantive issues. They sought its authority to consider the facts and
evidence presented during the trial and to render a decision based on the
merits.

Thus, petitioners cannot now claim that the Court of Appeals exceeded its
jurisdiction in ruling on the merits after consideration of the facts and
evidence just because the decision was unfavorable to them. They have
invoked the jurisdiction of the Court of Appeals, and thus, are now bound
by it.

423
 CRISTINA BARSOLO, PETITIONER, VS. SOCIAL SECURITY
SYSTEM, RESPONDENT.

G.R. No. 187950

January 11, 2017

J. Leonen

DOCTRINE:
Findings of facts of quasi-judicial agencies are accorded great respect and, at
times, even finality if supported by substantial evidence. These findings are
especially persuasive when, such as in this case, all three lower tribunals concur
in their findings.

FACTS:

Cristina Barsolo's (Cristina) deceased husband, Manuel M. Barsolo

(Manuel), "was employed as a seaman by various companies. From July 2,
2002 to December 6, 2002, Manuel served as a Riding Gang/ Able Seaman
onboard MT Polaris Star with Vela International Marine Ltd., (Vela). Vela
was his last employer before he died in 2006. After his separation from
employment with Vela, Manuel was diagnosed with hypertensive
cardiovascular disease, coronary artery disease, and osteoarthritis. He
was examined and treated at the Philippine Heart Center as an outpatient
from April 2, 2003 to October 22, 2004. When he died on September 24,
2006, the autopsy report listed myocardial infarction as his cause of death.
Believing that the cause of Manuel's death was work-related, Cristina
filed a claim for death benefits under Presidential Decree No. 626, as
amended, with the Social Security System.

424
SSS Ruling: The Social Security System, denied her claim on the ground
that there was no longer an employer-employee relationship at the time of
Manuel's death and that "his being a smoker increased his risk of
contracting the illness."

Employees' Compensation Commission Ruling: in a Decision, the ECC

denied the appeal for lack of merit. The Commission held that Cristina
was unable to establish that her husband's case fell under any of the
above circumstances. Moreover, since Manuel was a smoker, the
Commission believed that Manuel's "smoking habits precipitated the
manifestation of his Myocardial Infarction."

CA Ruling: The Court of Appeals, denied the petition for lack of merit.
The Court of Appeals ruled that while there was no doubt that
myocardial infarction was a compensable disease, Cristina failed to prove
a causal relationship between Manuel's work and the illness that brought
about his death. The Court of Appeals agreed with the Commission that
Manuel's habit of smoking, which dates as far back as 1973, may have
contributed to the development of his heart ailment.

Hence, this Petition was filed.

ISSUE:

Whether or not there is substantial evidence that death due to

myocardial infraction is work related.

425
RULING:

The SC did not find merit in the petition. The SC held citing Rañises
v. Employees Compensation Commission, that for myocardial infraction to be
considered a compensable occupational disease, any of the three
conditions must be proven by substantial evidence.

a) If the heart disease was known to have been present during

employment there must be proof that an acute exacerbation clearly
precipitated by the unusual strain by reason of the nature of his work;

b) The strain of work that brings about an acute attack must be of

sufficient severity and must be followed within twenty-four (24) hours by
the clinical signs of a cardiac assault to constitute causal relationship.

c) If a person who was apparently asymptomatic before subjecting

himself to strain of work showed signs and symptoms of cardiac injury
during the performance of his work and such symptoms and signs
persisted, it is reasonable to claim a causal relationship.

Petitioner failed in this regard. On petitioner's insistence that Manuel's

case falls under the third condition, this Court disagrees. For a claim
under this condition to prosper, there must be proof that: first, the person
was asymptomatic before beginning employment and second, he had
displayed symptoms during the performance of his duties. Such
symptoms should have persisted long enough to establish that his work
caused his heart problem. However, petitioner offered no proof that her
husband suffered any of the symptoms during his employment.

The Medical Certificate did not help petitioner's cause, as this only shows
that Manuel was already suffering from hypertension even before his pre-
employment examination, and that he did not contract it during his
employment with Vela. Since there was no showing that her husband
showed any sign or symptom of cardiac injury during the performance of
his functions, petitioner clearly failed to show that her husband's

426
employment caused the disease or that his working conditions
aggravated his existing heart ailment. Moreover, as the Court of Appeals
correctly pointed out, Manuel died on September 24, 2006, four
years after he disembarked from MV Polaris Star. Other factors have
already played a role in aggravating his illness.

In any case, the Court in Triple Eight Integrated Services, Inc. v. National
Labor Relations Commission, held that findings of facts of quasi-judicial
agencies are accorded great respect and, at times, even finality if
supported by substantial evidence. These findings are especially
persuasive when, such as in this case, all three lower tribunals concur in
their findings. We find no reason to overturn their findings.

427
 DIVINA PALAO, Petitioner vs. FLORENTINO INTERNATIONAL,
INC., Respondent

G.R. No. 186967

January 18, 2017

J. Leonen

DOCTRINE:
Remedial Law; Civil Procedure; Certification of Non-forum Shopping; The
Supreme Court (SC) held that while, as a rule, “the certificate of non-forum
shopping must be signed by all the plaintiffs in a case and the signature of only
one (1) of them is insufficient,” still, “when all the petitioners share a common
interest and invoke a common cause of action or defense, the signature of only one
of them in the certification against forum shopping substantially complies with
the rules.

Administrative Agencies; Administrative bodies are not strictly bound by

technical rules of procedure.—Administrative bodies are not strictly bound by
technical rules of procedure: Administrative bodies are not bound by the technical
niceties of law and procedure and the rules obtaining in courts of law.
Administrative tribunals exercising quasi-judicial powers are unfettered by the
rigidity of certain procedural requirements, subject to the observance of
fundamental and essential requirements of due process in justiciable cases
presented before them. In administrative proceedings, technical rules of procedure
and evidence are not strictly applied and administrative due process cannot be
fully equated with due process in its strict judicial sense.

FACTS:

Florentino appealed to the Office of the Director General of the

Intellectual Property Office. This appeal's Verification and Certification of

428
Non-Forum Shopping was signed by Atty. John Labsky P. Maximo (Atty.
Maximo) of the firm Balgos and Perez. However, Florentino failed to
attach to its appeal a secretary's certificate or board resolution authorizing
Balgos and Perez to sign the Verification and Certification of Non-Forum
Shopping. Thus, on August 14, 2008, the Office of the Director General
issued the Order requiring Florentino to submit proof that Atty. Maximo
or Balgos and Perez was authorized to sign the Verification and
Certification of Non-Forum Shopping. Intellectual Property Office
Director General Adrian S. Cristobal, Jr. (Director General Cristobal)
dismissed Florentino's appeal. He noted that the Secretary's Certificate
pertained to an August 14, 2008 Resolution issued by Florentino' s Board
of Directors, and reasoned that the same Certificate failed to establish the
authority of Florentino's counsel to sign the Verification and Certification
of Non-Forum Shopping as of the date of the filing of Florentino's appeal.
Florentino then filed before the Court of Appeals a Petition for Review
under Rule 43 of the 1997 Rules of Civil Procedure. In its assailed January
8, 2009 Decision, the Court of Appeals faulted Director General Cristobal
for an overly strict application of procedural rules. Thus, it reversed
Director General Cristobal's September 22, 2008 Order and reinstated
Florentino’s appeal.

ISSUE:

Whether or not the Court of Appeals erred in reversing the Order of

Intellectual Property Office Director General, and in reinstating
respondent Florentino appeal.

RULING:

The need for a certification of non-forum shopping to be attached to

respondent's appeal before the Office of the Director General of the

429
Intellectual Property Office is established. Section 3 of the Intellectual
Property Office's Uniform Rules on Appeal specifies the form through
which appeals may be taken to the Director General.

These requirements notwithstanding, the Intellectual Property Office's

own Regulations on Inter Partes Proceedings (which governs petitions for
cancellations of a mark, patent, utility model, industrial design,
opposition to registration of a mark and compulsory licensing, and which
were in effect when respondent filed its appeal) specify that the
Intellectual Property Office "shall not be bound by the strict technical
rules of procedure and evidence.

Given these premises, it was an error for the Director General of the
Intellectual Property Office to have been so rigid in applying a procedural
rule and dismissing respondent's appeal. It is reasonable, therefore-
consistent with the precept of liberally applying procedural rules in
administrative proceedings, and with the room allowed by jurisprudence
for substantial compliance with respect to the rule on certifications of non-
forum shopping-to construe the error committed by respondent as a
venial lapse that should not be fatal to its cause.

430
 VAN CLIFFORD TORRES Y SALERA, PETITIONER, V. PEOPLE OF
THE PHILIPPINES, RESPONDENT.

G.R. No. 206627

January 18, 2017

J. Leonen

DOCTRINE:
Remedial Law; Civil Procedure; Appeals; Petition for Review on Certiorari; It is a
fundamental rule that only questions of law may be raised in a petition for review
on certiorari under Rule 45. The factual findings of the trial court, especially
when affirmed by the Court of Appeals, are generally binding and conclusive on
this Court. This Court is not a trier of facts. It is not duty-bound to analyze,
review, and weigh the evidence all over again in the absence of any showing of
any arbitrariness, capriciousness, or palpable error. A departure from the general
rule may only be warranted in cases where the findings of fact of the Court of
Appeals are contrary to the findings of the trial court or when these are
unsupported by the evidence on record.

FACTS:

On November 3, 2003, CCC and AAA were at the barangay hall of

Clarin, Bohol waiting for the conciliation proceedings to begin when they
chanced upon Torres who had just arrived from fishing. CCC's wife
persuaded Torres to attend the conciliation proceedings to answer for his
liability. Torres vehemently denied damaging CCC's multicab. In the
middle of the brewing argument, AAA suddenly interjected that Torres
damaged CCC's multicab and accused him of stealing CCC's fish nets.
Torres told AAA not to pry in the affairs of adults. He warned AAA that
he would whip him if he did not stop. However, AAA refused to keep
silent and continued to accuse Torres of damaging his uncle's multicab.

431
Infuriated with AAA's meddling, Torres whipped AAA on the neck using
a wet t-shirt. Torres continued to hit AAA causing the latter to fall down
from the stairs. CCC came to his nephew's defense and punched Torres.
They engaged in a fistfight until they were separated by Barangay
Captain Hermilando Miano. Torres hit AAA with a wet t-shirt three (3)
times. Based on the physical examination conducted by Dr. Vicente
Manalo, Jr., AAA sustains a contusion.

After the prosecution rested its case, the defense presented the following
version of the incident: Torres testified that he had just arrived tired from
fishing when CCC badgered him to answer for the damage he had
allegedly caused to CCC's multicab. AAA abruptly interrupted the heated
discussion between the two men. Angered by what AAA had done,
Torres told AAA to stop making unfounded accusations or he would be
forced to whip him. AAA called Torres' bluff, which further provoked
Torres. Torres attempted to hit AAA but was thwarted by the timely
intervention of CCC, who suddenly attacked. Torres claimed that CCC
filed this case to preempt him from filing a complaint for physical injuries
against CCC. He also claimed that he tried to settle the matter with CCC
and CCC's wife. However, the parties failed to reach an agreement due to
the unreasonable demands of the spouses.

The Regional Trial Court convicted Torres GUILTY beyond reasonable

doubt of Other Acts of Child Abuse. Torres appealed before the Court of
Appeals, arguing that the prosecution failed to establish all the elements
of child abuse and that his guilt was not proven beyond reasonable doubt.

The Court of Appeals affirmed the Regional Trial Court Decision, albeit
with modification as to the penalty.

432
ISSUE:

Whether or not the Court of Appeals erred in sustaining his

conviction on a judgment premised on a misapprehension of facts.

RULING:

This Court finds no reason to disturb the factual findings of the trial
court. The trial court neither disregarded nor overlooked any material fact
or circumstance that would substantially alter the case. The presence or
absence of one person during the incident is not substantial enough to
overturn the finding that petitioner whipped AAA three (3) times with a
wet t-shirt. Assuming, without admitting, that petitioner did whip AAA,
petitioner argues that it should not be considered as child abuse because
the law requires intent to abuse. Petitioner maintains that he whipped
AAA merely to discipline and restrain the child "from further intensifying
the situation." He also maintains that his act was justified because AAA
harassed and vexed him. Thus, petitioner claims that there could not have
been any intent to abuse on his part. Petitioner contends that the injuries
sustained by AAA will not affect the latter's physical growth or
development and mental capacity. He argues that he could not be
convicted of child abuse without proof that the victim's development had
been prejudiced.

He begs the indulgence of this Court and claims that his conviction would
only serve as a "precedent to all children to act recklessly, errantly and
disobediently" and would then create a society ruled by juvenile
delinquency and errant behavior. If at all, petitioner claims that he could
only be convicted of slight physical injuries under the Revised Penal Code
for the contusion sustained by AAA. Respondent maintains that the act of
whipping AAA is an act of child abuse. Respondent argues that the act
complained of need not be prejudicial to the development of the child for
it to constitute a violation of Republic Act No. 7610. Respondent, citing

433
Sanchez v. People, argues that Section 10(a) of Republic Act No. 7610
defines and punishes four distinct acts. We reject petitioner's contention
that his act of whipping AAA is not child abuse but merely slight physical
injuries under the Revised Penal Code. The victim, AAA, was a child
when the incident occurred. Therefore, AAA is entitled to protection
under Republic Act No. 7610, the primary purpose of which has been
defined in Araneta v. People thus:

Republic Act No. 7610 is a measure geared towards the implementation of

a national comprehensive program for the survival of the most vulnerable
members of the population, the Filipino children, in keeping with the
Constitutional mandate under Article XV, Section 3, paragraph 2, that
"The State shall defend the right of the children to assistance, including
proper care and nutrition, and special protection from all forms of neglect,
abuse, cruelty, exploitation, and other conditions prejudicial to their
development."

434
PEOPLE OF THE PHILIPPINES, vs. MONIR JAAFAR y TAMBUYONG

G.R. No. 219829

January 18, 2017

J. Leonen

DOCTRINE:
Chain of Custody Rule; It is imperative that the drugs allegedly seized from the
accused are the very same objects tested in the laboratory and offered in court as
evidence.—In all prosecutions for violations of Republic Act No. 9165, the corpus
delicti is the dangerous drug itself. Its existence is essential to a judgment of
conviction. Hence, the identity of the dangerous drug must be clearly established.
The chain of custody, as a method of authentication, ensures that unnecessary
doubts involving the identity of seized drugs are removed.

FACTS:

Accused-appellant Monir Jaafar y Tambuyong (Jaafar) and Ahmad

Gani y Idjirani (Gani) were charged with violation of Republic Act No.
9165. The above named accused, not being authorized by law to sell,
deliver, give away to another, transport or distribute any dangerous drug,
conspiring and confederating together, mutually aiding and assisting one
another, did then and there willfully, unlawfully and feloniously sell and
deliver to PO1 Marlon Takazi M. Look, who acted as poseur-buyer, one
(1) [heat-sealed] transparent plastic sachet containing white crystalline
substance weighing 0.0604 grams which when subjected to qualitative
examination gave positive result to the tests for the presence of
METHAMPHETAMINE HYDROCHLORIDE (SHABU).

The Regional Trial Court found that the prosecution clearly established
all the elements of the crime of illegal sale of drugs and convicted Jaafar.

435
Although the chain of custody rule was not strictly complied with, the
trial court ruled that the integrity and evidentiary value of the confiscated
shabu sachet had been duly preserved. It applied the legal presumption of
regularity in the performance of duties by the police officers. The Court
of Appeals affirmed the Regional Trial Court Decision in toto.

ISSUE:

Whether the guilt of accused appellant was proven beyond

reasonable doubt despite the non-observance of the required procedure
under Section 21 of Republic Act No. 9165.

RULING:

This Court grants the appeal and acquits accused-appellant Monir

Jaafar y Tambuyong. In all prosecutions for violations of Republic Act No.
9165, the corpus delicti is the dangerous drug itself. Its existence is essential
to a judgment of conviction. Hence, the identity of the dangerous drug
must be clearly established. Narcotic substances are not readily
identifiable. To determine their composition and nature, they must
undergo scientific testing and analysis. Narcotic substances are also
highly susceptible to alteration, tampering, or contamination. It is
imperative, therefore, that the drugs allegedly seized from the accused are
the very same objects tested in the laboratory and offered in court as
evidence. The chain of custody, as a method of authentication, ensures
that unnecessary doubts involving the identity of seized drugs are
removed.

While it may be true that non-compliance with Section 21 of Republic Act

No. 9165 is not fatal to the prosecution's case provided that the integrity
and evidentiary value of the seized items are properly preserved by the
apprehending officers, this exception will only be triggered by the

436
existence of a ground that justifies departure from the general rule. This
Court finds that the prosecution failed to show any justifiable reason that
would warrant non-compliance with the mandatory requirements in
Section 21 of Republic Act No. 9165. Although the buy-bust team
marked and conducted a physical inventory of the seized sachet of shabu,
the records do not show that the seized sachet had been photographed.
Furthermore, there is absolutely no evidence to show that the physical
inventory was done in the presence of accused-appellant or his
representative, representatives from the media and the Department of
Justice, and an elected public official.

This Court cannot merely gloss over the glaring procedural lapses
committed by the police officers, especially when what had been
allegedly seized from accused-appellant was only 0.0604 grams of shabu.
Recent cases have highlighted the need to ensure the integrity of seized
drugs in the chain of custody when only a miniscule amount of drugs had
been allegedly seized from the accused.

437
REPUBLIC OF THE PHILIPPINES, represented by the DEPARTMENT
OF PUBLIC WORKS AND HIGHWAYS (DPWH), petitioner, vs.
SPOUSES FRANCISCO R. LLAMAS and CARMELITA C. LLAMAS,
respondents.

GR. No. 194190

January 25, 2017

J. Leonen

DOCTRINE:
As there is no such thing as an automatic cession to government of subdivision
road lots, an actual transfer must first be effected by the subdivision owner:
“subdivision streets belonged to the owner until donated to the government or
until expropriated upon payment of just compensation.”

FACTS:

On April 23, 1990, the Department of Public Works and Highways

initiated an action for expropriation for the widening of Dr. A. Santos
Ave. (also known as Sucat Road) in what was then the Municipality of
Parañaque, Metro Manila. On January 27, 1994, the Llamas Spouses filed
before the Regional Trial Court a "Most Urgent and Respectful Motion for
Leave to be Allowed Intervention as Defendants-Intervenors-
Oppositors." They claimed that they were excluded from the
expropriation case despite having properties affected by the road
widening project. After a hearing on this Motion, the Regional Trial Court
allowed the Llamas Spouses to file their Answer-in-Intervention. The
Department of Public Works and Highways filed its
Comment/Opposition to the Llamas Spouses'. The Regional Trial Court
issued the Order directing the payment of the value of the lots of the

438
defendants in the expropriation case. The lots subjects of the Llamas
Spouses’ intervention were not included in this Order.

The Regional Trial Court issued the Order directing the payment to the
Llamas Spouses of just compensation. It denied payment for areas
covered by TCT No. 179165 and noted that these were subdivision road
lots, which the Llamas Spouses "no longer owned" and which "belong[ed]
to the community for whom they were made." The Llamas Spouses then
filed before the Court of Appeals a Petition for Certiorari.

The Court of Appeals reversed and set aside the assailed Orders of the
Regional Trial Court and ordered the Department of Public Works and
Highways to pay the Llamas Spouses just compensation, inclusive of the
portions excluded by the Regional Trial Court. The Court of Appeals
reasoned that the disputed area (covered by TCT No. 179165) did not lose
its private character, the easement of right of way over it
notwithstanding. Further, it anchored its ruling on interest liability on
Rule 67, Section 10 of the 1997 Rules of Civil Procedure.

ISSUE:

Whether just compensation must be paid to respondents Francisco

and Carmelita Llamas for the subdivision road lots covered by TCT No.
179165.

RULING:

The Department of Public Works and Highways is in grave error.

The 1998 White Plains Decision unequivocally repudiated the 1991 White
Plains Decision's allusion to a compulsion on subdivision developers to
cede subdivision road lots to government, so much that it characterized
such compulsion as an "illegal taking." It did away with any preference

439
for government's capacity to compel cession and, instead, emphasized the
primacy of subdivision owners' and developers' freedom in retaining or
disposing of spaces developed as roads. In making its characterization of
an "illegal taking," this Court quoted with approval the statement of the
Court of Appeals: Only after a subdivision owner has developed a road
may it be donated to the local government, if it so desires. On the other
hand, a subdivision owner may even opt to retain ownership of private
subdivision roads, as in fact is the usual practice of exclusive residential
subdivisions for example those in Makati City.

A donation is, by definition, "an act of liberality." Article 725 of the Civil
Code provides: Article 725. Donation is an act of liberality whereby a
person disposes gratuitously of a thing or right in favor of another, who
accepts it. To be considered a donation, an act of conveyance must
necessarily proceed freely from the donor's own, unrestrained volition. A
donation cannot be forced: it cannot arise from compulsion, be borne by a
requirement, or otherwise be impelled by a mandate imposed upon the
donor by forces that are external to him or her. Article 726 of the Civil
Code reflects this commonsensical wisdom when it specifically states that
conveyances made in view of a "demandable debt" cannot be considered
true or valid donations.

The Court of Appeals correctly stated that a "positive act" must first be
made by the "owner-developer before the city or municipality can acquire
dominion over the subdivision roads." As there is no such thing as an
automatic cession to government of subdivision road lots, an actual
transfer must first be effected by the subdivision owner: "subdivision
streets belonged to the owner until donated to the government or until
expropriated upon payment of just compensation." Stated otherwise, "the
local government should first acquire them by donation, purchase, or
expropriation, if they are to be utilized as a public road."

440
 METROPOLITAN BANK AND TRUST COMPANY VS. LIBERTY
CORRUGATED BOXES MANUFACTURING CORPORATION

G.R. No. 184317

January 25, 2017

J. Leonen

DOCTRINE:
“A petition for rehabilitation, the procedure for which is provided in the Interim
Rules of Procedure on Corporate Recovery, should be considered as a special
proceeding. It is one that seeks to establish the status of a party or a particular
fact. As provided in section 1, Rule 4 of the Interim Rules on Corporate Recovery,
the status or fact sought to be established is the inability of the corporate debtor to
pay its debts when they fall due so that a rehabilitation plan, containing the
formula for the successful recovery of the corporation, may be approved in the
end. It does not seek a relief from an injury caused by another party.”

FACTS:

The Court of Appeals affirmed the Regional Trial Court's December 21,
2007Order approving Liberty Corrugated Boxes Manufacturing Corp.'s
rehabilitation plan.

Respondent Liberty Corrugated Boxes Manufacturing Corp. is a domestic

corporation that produces corrugated packaging boxes. It obtained
various credit accommodations and loan facilities from petitioner
Metropolitan Bank and Trust Company (Metrobank) amounting to Pl
9,940,000.00. To secure its loans, Liberty mortgaged to Metrobank 12 lots
in Valenzuela City.

441
On June 21, 2007, Liberty filed a Petition for corporate rehabilitation
before Branch 7 4 of the Regional Trial Court of Malabon City. Liberty
claimed that it could not meet its obligations to Metrobank because of the
Asian Financial Crisis, which resulted in a drastic decline in demand for
its goods, and the serious sickness of its Founder and President, Ki Kiao
Koc. Liberty's rehabilitation plan consisted of: (a) a debt moratorium; (b)
renewal of marketing efforts; (c) resumption of operations; and ( d) entry
into condominium development, a new business.

On August 6, 2007, Metro bank filed its comment/opposition. It argued

that Liberty was not qualified for corporate rehabilitation; that Liberty's
Petition for rehabilitation and rehabilitation plan were defective; and that
rehabilitation was not feasible. It also claimed that Liberty filed the
Petition solely to avoid its obligations to the bank.

Rehabilitation Receiver Rafael Chris F. Teston recommended the approval

of the plan, provided that Liberty would initiate construction on the
property in Valenzuela within 12 months from approval.

In its December 21, 2007 Order, the Regional Trial Court approved the
rehabilitation plan. Metrobank appealed to the Court of Appeals. On June
13, 2008, the Court of Appeals issued the Decision16 denying the Petition
and affirming the Regional Trial Court's December 21, 2007 Order.

The Court of Appeals also found that the trial court correctly approved
the rehabilitation plan over Metrobank's Opposition upon the
recommendation of the Rehabilitation Receiver, who had carefully
considered and addressed Metrobank's criticism on the plan's viability.

442
The Court of Appeals stressed that the purpose of rehabilitation
proceedings is to enable the distressed company to gain a new lease on
life and to allow the creditors to be paid their claims. It held that the
approval of the Regional Trial Court was precisely "'to effect a feasible
and viable rehabilitation' of ailing corporations” as required by
Presidential Decree No. 902-A.

ISSUES:

Whether respondent, as a debtor in default, is qualified to file a petition

for rehabilitation under Presidential Decree No. 902-A and Rule 4, Section
1 of the Interim Rules; and

Whether respondent's Petition for rehabilitation is sufficient in form and

substance and respondent's rehabilitation plan, feasible.

RULING:

1) Rule 4, Section 1 of the Interim Rules provides: RULE4Debtor-Initiated

Rehabilitation

SECTION 1. Who May Petition. - Any debtor who foresees the

impossibility of meeting its debts when they respectively fall due, or any
creditor or creditors holding at least twenty-five percent (25%) of the
debtor's total liabilities, may petition the proper Regional Trial Court to
have the debtor placed under rehabilitation.

Philippine Bank of Communications v. Basic Polyprinters and Packaging

Corporation reiterates the purpose of rehabilitation, which is to provide
meritorious corporations an opportunity for recovery: Under the Interim
Rules, rehabilitation is the process of restoring "the debtor to a position of

443
successful operation and solvency, if it is shown that its continuance of
operation is economically feasible and its creditors can recover by way of
the present value of payments projected in the plan more if the
corporation continues as a going concern that if it is immediately
liquidated." It contemplates a continuance of corporate life and activities
in an effort to restore and reinstate the corporation to its former position
of successful operation and solvency.

2) The Interim Rules provide for a liberal construction of its provisions:

RULE2- Definition of Terms and Construction

SECTION 2. Construction. - These Rules shall be liberally construed to

carry out the objectives of Sections 5(d), 6(c) and 6(d) of Presidential
Decree No. 902-A, as amended, and to assist the parties in obtaining a
just, expeditious, and inexpensive determination of cases. Where
applicable, the Rules of Court shall apply suppletorily to proceedings
under these Rules.

To adopt petitioner's interpretation would undermine the purpose of the

Interim Rules. There is no reason why corporations with debts that may
have already matured should not be given the opportunity to recover and
pay their debtors in an orderly fashion. The opportunity to rehabilitate
the affairs of an economic entity, regardless of the status of its debts,
redounds to the benefit of its creditors, owners, and to the economy in
general. Rehabilitation, rather than collection of debts from a company
already near bankruptcy, is a better use of judicial rewards.

A.M. No. 08-8-1 O-SC further describes the remedy initiated by a petition
for rehabilitation: A petition for rehabilitation, the procedure for which is

444
provided in the Interim Rules of Procedure on Corporate Recovery,
should be considered as a special proceeding. It is one that seeks to
establish the status of a party or a particular fact. As provided in section 1,
Rule 4 of the Interim Rules on Corporate Recovery, the status or fact
sought to be established is the inability of the corporate debtor to pay its
debts when they fall due so that a rehabilitation plan, containing the
formula for the successful recovery of the corporation, may be approved
in the end. It does not seek a relief from an injury caused by another
party.

445
 Pilipinas Shell Petroleum Corporation vs. Royal Ferry Services, Inc.

G.R. No. 188146

February 1, 2017

J. Leonen

DOCTRINE:
“To determine the venue of an insolvency proceeding, the residence of a
corporation should be the actual place where its principal office has been located
for six (6) months before the filing of the petition. If there is a conflict between the
place stated in the articles of incorporation and the physical location of the
corporation's main office, the actual place of business should control.

Requiring a corporation to go back to a place it has abandoned just to file a case is

the very definition of inconvenience. There is no reason why an insolvent
corporation should be forced to exert whatever meager resources it has to litigate
in a city it has already left.

FACTS:

Royal Ferry’s principal place of business, according to its Articles of

Incorporation is located at 2521 A. Bonifacio Street,Bangkal, Makati City.
However, it currently holds office at Room 203, BF Condominium
Building, Andres Soriano Streets, Intramuros, Manila.

Royal Ferry filed a verified Petition for Voluntary Insolvency before the
Regional Trial Court of Manila. The RTC then declared Royal Ferry
insolvent.

The Court orders:

The Branch Sheriff to take possession of, and safely keep until the
appointment, of an Assignee all the deeds, vouchers, books of accounts,

446
papers, notes, bills and securities of the petitioner and all its real and
personal properties, estates and effects not exempt from execution;

All persons and entities owing money to petitioner are hereby forbidden
to make payment for its accounts or to deliver or transfer any property to
petitioner except to the duly elected Assignee;

All civil proceedings against petitioner are deemed stayed;

For purposes of electing an Assignee, a meeting of all creditors of the

petitioner is hereby set on February 24, 2006 at 8:30 a.m. before this Court,
at Room 435, Fourth Floor, Manila City Hall Building.

The said order was published in a newspaper of general circulation for

three consecutive weeks furnishing copies to all creditors of the company
in the schedule of creditors.

Pilipinas Shell filed before the RTC of Manila a Formal Notice of Claim
and a Motion to Dismiss. In its Motion to Dismiss, Pilipinas Shell alleged
that the Petition was filed in the wrong venue. It argued that the
Insolvency Law provides that a petition for insolvency should be filed
before the court with territorial jurisdiction over the corporation’s
residence. Since Royal Ferry’s Articles of Incorporation stated that the
corporation’s principal office is at Makati City, the Petition should be filed
before the RTC of Makati and not before the RTC of Manila.

RTC Manila denied Pilipinas Shell’s Motion to Dismiss for lack of merit.
It found Royal Ferry to have sufficiently shown full compliance with the
requirements of insolvency Law on venue and that it had abandoned its
Makati office and moved to Manila. The court also noted that when the
branch Sheriff confiscated Royal Ferry’s books and personal assets, the
properties were taken from a Manila address.

447
Pilipinas Shell moved for reconsideration and the same was granted. The
RTC held that a corporation cannot change its place of business without
amending its Articles of Incorporation. Without the amendment, Royal
Ferry’s transfer did not produce any legal effect on its residence. The RTC
granted the dismissal of the Petition for Voluntary Insolvency.

Aggrieved, Royal Ferry filed a Notice of Appeal. The RTC forwarded the
records of the case to the Court of Appeals. In its Decision, the CA
granted the Appeal and reinstated the insolvency proceedings. The CA
overturned the grant of the Motion to Dismiss since Pilipinas Shell failed
to secure the written consent of all the creditors of Royal Ferry, a
requirement under the Insolvency Law.

On the alleged jurisdictional defects of Royal Ferry’s Petition for

Voluntary Insolvency, the CA found that "the [Manila Regional Trial
Court] has jurisdiction over the instant case, and therefore, has the
authority to render a decision on it." It likewise found that Manila was the
proper venue for the case because "the cities of Makati and Manila are
part of one region, or even a province, city or municipality, if Section 51 of
the Corporation Code of the Philippines is taken by analogy." The CA
stated that Section 8234 of the Insolvency Law dictates that an order
granting an adjudication of insolvency is appealable only to the Supreme
Court.

The Motion for Reconsideration by Pilipinas Shell was denied, thus, this
Petition.

ISSUE:

Whether or not the Petition for Insolvency was properly filed before RTC
Manila.

448
RULING:

No. To determine the venue of an insolvency proceeding, the residence of

a corporation should be the actual place where its principal office has
been located for six ( 6) months before the filing of the petition. If there is
a conflict between the place stated in the articles of incorporation and the
physical location of the corporation's main office, the actual place of
business should control.

Requiring a corporation to go back to a place it has abandoned just to file

a case is the very definition of inconvenience. There is no reason why an
insolvent corporation should be forced to exert whatever meager
resources it has to litigate in a city it has already left.

In any case, the creditors deal with the corporation's agents, officers, and
employees in the actual place of business. To compel a corporation to
litigate in a city it has already abandoned would create more confusion.
Moreover, the six (6)-month qualification of the law's requirement of
residence shows intent to find the most accurate location of the debtor's
activities. If the address in a corporation's articles of incorporation is
proven to be no longer accurate, then legal fiction should give way to fact.

449
 LIZA L. MAZA v. HON. EVELYN A. TURLA

G.R. No. 187094

February 15, 2017

J. Leonen

DOCTRINE:
Upon filing of an information in court, trial court judges must determine the
existence or non-existence of probable cause based on their personal evaluation of
the prosecutor's report and its supporting documents. They may dismiss the case,
issue an arrest warrant, or require the submission of additional evidence.
However, they cannot remand the case for another conduct of preliminary
investigation on the ground that the earlier preliminary investigation was
improperly conducted.

FACTS:

Petitioners Liza L. Maza, Saturnino C. Ocampo, Teodoro A. Casiño,

and Rafael V. Mariano (petitioners) are former members of the House of
Representatives. Liza represented Gabriela Women's Party (Gabriela),
Saturnino and Teodoro represented Bayan Muna Party-List (Bayan
Muna), while Rafael represented Anakpawis Party-List (Anakpawis).
Inspector Palomo named 19 individuals, including Petitioners, who were
allegedly responsible for the death of Carlito Bayudang, Jimmy Peralta,
and Danilo Felipe.[8] His findings show that the named individuals
conspired, planned, and implemented the killing of the supporters of
AKBAYAN Party List (AKBAYAN), a rival of Bayan Muna and
Gabriela.[9] Carlito Bayudang and Danilo Felipe were AKBAYAN
community organizers,[10] whereas Jimmy Peralta was mistaken for a
certain Ricardo Peralta, an AKBAYAN supporter.
Inspector Palomo recommended that a preliminary investigation be
conducted and that an Information for each count of murder be filed
against the 19 individuals.

450
The panel of prosecutors issued on April 11, 2008 a Joint Resolution,[24]
reviewed and approved by Officer-in-charge Provincial Prosecutor Floro
F. Florendo (Prosecutor Florendo). The panel found probable cause for
murder in the killing of Carlito Bayudang and Jimmy Peralta, and for
kidnapping with murder in the killing of Danilo Felipe, against the
nineteen 19 suspects. However, the panel considered one of the suspects,
Julie Flores Sinohin, as a state witness. The panel recommended that the
corresponding Informations be filed against the remaining suspects.[25]
On the same day, two (2) Informations[26] for murder were filed before
the Regional Trial Court of Palayan City, Branch 40 in Nueva Ecija,
(Palayan cases) and an Information[27] for kidnapping with murder was
filed in Guimba, Nueva Ecija (Guimba case).

On July 18, 2008, Presiding Judge Evelyn A. Atienza-Turla (Judge Turla)

issued an Order[37] on the Palayan cases. Judge Turla held that "the
proper procedure in the conduct of the preliminary investigation was not
followed in [the Palayan] cases" and ordered the case be remanded to the
prosecutor’s office for another preliminary investigation.

ISSUES:
Whether respondent Judge Turla gravely abused her discretion when she
remanded the Palayan cases to the Provincial Prosecutor for the conduct
of preliminary investigation

RULING:
The remand of the criminal cases to the Provincial Prosecutor for the
conduct of another preliminary investigation is improper.
SEC. 5. When warrant of arrest may issue. – (a) By the Regional Trial
Court. -Within ten (10) days from the filing of the complaint or
information, the judge shall personally evaluate the resolution of the
prosecutor and its supporting evidence. He may immediately dismiss the
case if the evidence on record clearly fails to establish probable cause. If

451
he finds probable cause, he shall issue a warrant of arrest, or a
commitment order when the complaint or information was filed pursuant
to section 6 of this Rule. In case of doubt on the existence of probable
cause, the judge may order the prosecutor to present additional evidence
within five (5) days from notice and the issue must be resolved by the
court within thirty (30) days from the filing of the complaint or
information.

A plain reading of the provision shows that upon filing of the

information, the trial court judge has the following options: (1) dismiss
the case if the evidence on record clearly fails to establish probable cause;
(2) issue a warrant of arrest or a commitment order if findings show
probable cause; or (3) order the prosecutor to present additional evidence
if there is doubt on the existence of probable cause.
The trial court judge's determination of probable cause is based on her or
his personal evaluation of the prosecutor's resolution and its supporting
evidence. The determination of probable cause by the trial court judge is a
judicial function, whereas the determination of probable cause by the
prosecutors is an executive function.
Regardless of Judge Turla's assessment on the conduct of the preliminary
investigation, it was incumbent upon her to determine the existence of
probable cause against the accused after a personal evaluation of the
prosecutors' report and the supporting documents. She could even
disregard the report if she found it unsatisfactory, and/or require the
prosecutors to submit additional evidence. There was no option for her to
remand the case back to the panel of prosecutors for another preliminary
investigation. In doing so, she acted without any legal basis.

452
453
 MERCEDES S. GATMAYTAN vs. FRANCISCO DOLOR (Substituted
by his heirs), and HERMOGENA DOLOR.

G.R. No. 198120

February 20, 2017

J. Leonen

DOCTRINE:
When a party's counsel serves a notice of change in address upon a court, and the
court acknowledges this change, service of papers, processes, and pleadings upon
the counsel's former address is ineffectual. Service is deemed completed only
when made at the updated address. Proof, however, of ineffectual service at a
counsel's former address is not necessarily proof of a party's claim of when
service was made at the updated address. The burden of proving the affirmative
allegation of when service was made is distinct from the burden of proving the
allegation of where service was or was not made. A party who fails to discharge
his or her burden of proof is not entitled to the relief prayed for.

Once a case is decided with finality, the controversy is settled and the matter is
laid to rest. Accordingly, [a final judgment] may no longer be modified in any
respect, even if the modification is meant to correct what is perceived to be an
erroneous conclusion of fact or law, and regardless of whether the modification is
attempted to be made by the court rendering it or by the highest court of the
land.“

FACTS:

In a Complaint for Reconveyance of Property and Damages filed

with the Quezon City Regional Trial Court, the Dolor Spouses alleged
that on February 17, 1984, they, as buyers, and Manuel Cammayo
(Cammayo), as seller, executed a Deed of Sale over a 300 square meter
parcel of land located in Novaliches, Quezon City. This 300 square meter
parcel was to be segregated from a larger landholding.

454
On March 27, 2006, the Quezon City Regional Trial Court, Branch 223
rendered a Decision ordering Gatmaytan to convey the lot to the Dolor
Spouses. On June 16, 2006, Gatmaytan filed her Motion for
Reconsideration, which was denied by the trial court on August 28, 2006.
Gatmaytan then filed an Appeal with the Court of Appeals.

In its assailed March 24, 2011 Decision, the Court of Appeals, Sixth
Division, dismissed Gatmaytan's Appeal. It ruled that the Regional Trial
Court's March 27, 2006 Decision had already attained finality as
Gatmaytan filed her Motion for Reconsideration beyond the requisite 15-
day period.

In its assailed August 9, 2011 Resolution, the Court of Appeals denied

Gatmaytan's Motion for Reconsideration. It emphasized that the Receipt
at the back of the last page of the Regional Trial Court's Decision
indicated that a copy of the same Decision was received by a certain
Maricel Luis (Luis), for and on behalf of Atty. Palad, on April 14,
2006. The Court of Appeals added that previous orders of the Regional
Trial Court were likewise received by Luis, and that Luis' authority to
receive for Atty. Palad had never been questioned.

Gatmaytan filed the Present Petition.

Gatmaytan insists that the Regional Trial Court's March 27, 2006 Decision
has not attained finality as the April 14, 2006 service was made to her
counsel's former address (at No. 117 West Avenue, Quezon City) as
opposed to the address (at Unit 602, No. 42 Prince Jun Condominium,
Timog Avenue, Quezon City) that her counsel indicated in a June 8, 2004
Notice of Change of Address filed with the Regional Trial Court.
Gatmaytan adds that the Regional Trial Court noted the change of
address in an Order of the same date, and directed that, from then on,
service of papers, pleadings, and processes was to be made at her

455
counsel's updated address at Unit 602, No. 42 Prince Jun Condominium,
Timog Avenue, Quezon City.

ISSUE:

Whether the Regional Trial Court's March 27, 2006 Decision has already
attained finality thus, precluding the filing of petitioner Mercedes S.
Gatmaytan's appeal with the Court of Appeals.

RULING:

It is elementary that “appeal is not a matter of right but a mere statutory

privilege.” As such, one who wishes to file an appeal “must comply with
the requirements of the rules, failing in which the right to appeal is lost.”
It is just as basic that a judgment can no longer be disturbed, altered, or
modified as soon as it becomes final and executory; “nothing is more
settled in law.” Once a case is decided with finality, the controversy is
settled and the matter is laid to rest. Accordingly, [a final judgment] may
no longer be modified in any respect, even if the modification is meant to
correct what is perceived to be an erroneous conclusion of fact or law, and
regardless of whether the modification is attempted to be made by the
court rendering it or by the highest court of the land. Once a judgment
becomes final, the court or tribunal loses jurisdiction, and any modified
judgment that it issues, as well as all proceedings taken for this purpose
are null and void

In accordance with Rule 36, Section 2 of the 1997 Rules of Civil Procedure,
unless a Motion for Reconsideration is timely filed, the judgment or final
order from which it arose shall become final:

456
Section 2. Entry of Judgments and Final Orders. — If no appeal or motion for
new trial or reconsideration is filed within the time provided in these Rules, the
judgment or final order shall forthwith be entered by the clerk in the book of
entries of judgments. The date of finality of the judgment or final order shall be
deemed to be the date of its entry. The record shall contain the dispositive
part of the judgment or final order and shall be signed by the clerk, with a
certificate that such judgment or final order has become final and
executory.

In turn, Rule 37, Section 1, in relation to Rule 41, Section 3 of the 1997
Rules of Civil Procedure, allows for 15 days from notice of a judgment or
final order within which a Motion for Reconsideration may be filed.

Rule 37, Section 1 reads:

Section 1. Grounds of and Period for Filing Motion for New Trial or
Reconsideration. — Within the period for taking an appeal, the aggrieved party
may move the trial court to set aside the judgment or final order and grant a new
trial for one or more of the following causes materially affecting the
substantial rights of said party:

(a) Fraud, accident, mistake or excusable negligence which ordinary

prudence could not have guarded against and by reason of which
such aggrieved party has probably been impaired in his rights; or

(b) Newly discovered evidence, which he could not, with reasonable

diligence, have discovered, and produced at the trial, and which if
presented would probably alter the result.
The period of appeal shall be interrupted by a timely motion for new trial
or reconsideration. No motion for extension of time to file a motion for
new trial or reconsideration shall be allowed.

Reckoning the date when a party is deemed to have been given notice of
the judgment or final order subject of his or her Motion for
Reconsideration depends on the manner by which the judgment of final
order was served upon the party himself or herself.

457
When, however, a party is represented and has appeared by counsel,
service shall, as a rule, be made upon his or her counsel.

To reiterate, service upon the parties' counsels of record is tantamount to

service upon the parties themselves, but service upon the parties
themselves is not considered service upon their lawyers. The reason is
simple—the parties, generally, have no formal education or knowledge of
the rules of procedure, specifically, the mechanics of an appeal or
availment of legal remedies; thus, they may also be unaware of the rights
and duties of a litigant relative to the receipt of a decision. More
importantly, it is best for the courts to deal only with one person in the
interest of orderly procedure—either the lawyer retained by the party or
the party him/herself if s/he does not intend to hire a lawyer.

We sustain petitioner's position that the service made on her counsel's

former address was ineffectual. We find however, that petitioner failed to
discharge her burden of proving the specific date - allegedly June 1, 2006 -
in which service upon her counsel's updated address was actually made.
Having failed to establish the reckoning point of the period for filing her
Motion for Reconsideration, we cannot sustain the conclusion that
petitioner insists on, and which is merely contingent on this reckoning
point: we cannot conclude that her Motion for Reconsideration was timely
filed. Having failed to discharge her burden of proof, we are constrained
to deny her Petition.

458
 LAND BANK OF THE PHILIPPINES, vs. LORENZO MUSNI,
EDUARDO SONZA and

SPOUSES IRENEO and NENITA SANTOS

G.R. No. 206343

February 22, 2017

J. Leonen

DOCTRINE:
“The determination of whether petitioner acted in good faith is a factual matter,
which cannot be raised before this Court in a Rule 45 petition. To emphasize,
“this Court is not a trier of facts and does not normally embark on a
reexamination of the evidence adduced by the parties during trial.”

FACTS:

Respondent Lorenzo Musni (Musni) was the compulsory heir of

Jovita Musni (Jovita), who was the owner of a lot in Comillas, La Paz,
Tarlac. Musni filed before the Regional Trial Court of Tarlac City a
complaint for reconveyance of land and cancellation of TCT against
Spouses Nenita Sonza Santos and Ireneo Santos (Spouses Santos),
Eduardo Sonza (Eduardo), and Land Bank of the Philippines (Land Bank).
Musni alleged that Nenita falsified a Deed of Sale, and caused the transfer
of title of the lot in her and her brother Eduardo's name. Then the spouses
Santos and Eduardo mortgaged the lot to Land Bank as security for their
loan. Musni said that he was dispossessed of the lot when Land Bank
foreclosed the property upon Nenita and Eduardo's failure to pay their
loan. Later, the titles of the lot and another foreclosed land were
consolidated in anothet TCT, under the name of Land Bank. Musni also
claimed that Nenita and Eduardo was convicted for falsification of a
public document which he filed against them before the MTC of Tarlac.

459
Land Bank filed its Amended Answer to the RTC with Counterclaim and
Crossclaim. It asserted that the transfer of the title in its name was because
of a decision rendered by the Department of Agrarian Reform
Adjudication Board, Region III. It countered that its transaction with the
Spouses Santos and Eduardo was legitimate, and that it verified the
authenticity of the title with the Register of Deeds. Further, the bank loan
was secured by another lot owned by the Spouses Santos, and not solely
by the lot being claimed by Musni. Land Bank prayed that it be paid the
value of the property and the expenses it incurred, should the trial court
order the reconveyance of the property to Musni.

On June 27, 2008, the trial court rendered a Decision, in favor of Musni. It
relied on the fact that Nenita was convicted of falsification of the Deed of
Sale. The trial court found that Musni did not agree to sell the property to
the Spouses Santos and Eduardo. In addition, the amount of Musni 's
indebtedness was an insufficient consideration for the market value of the
property. Lastly, the sale was executed before the loan's maturity.The trial
court also found that Land Bank was not an "innocent purchaser for
value.

The institution of the criminal case against Nenita should have alerted the
bank to ascertain the ownership of the lot before it foreclosed the same.
Land Bank and Nenita separately moved for reconsideration, which were
both denied by the trial court in an Omnibus Order. Land Bank and
Spouses Santos separately appealed to the Court of Appeals. In its
appeal,25 Land Bank reiterated that "it has demonstrated, by a
preponderance of evidence, that it is a mortgagee in good faith and a
subsequent innocent purchaser for value; as such, its rights as the new
owner of the subject property must be respected and protected by the

460
courts. However, the Court of Appeals ruled in favor of Musni. Land
Bank moved for reconsideration, but the same was denied.

ISSUES:

1. whether or not petitioner is a mortgagee in good faith and an innocent

purchaser for value; and

2. whether or not petitioner is entitled to the award of damages.

RULING:

1. No. Petitioner is neither a mortgagee in good faith nor an innocent

purchaser for value. Petitioner's defense that it could not have known the
criminal action since it was not a party to the case and that there was no
notice of lis pendens filed by respondent Musni, is unavailing. Had
petitioner exercised the degree of diligence required of banks, it would
have ascertained the ownership of one of the properties mortgaged to it.
Where "the findings of fact of the trial courts are affirmed by the Court of
Appeals, the same are accorded the highest degree of respect and,
generally, will not be disturbed on appeal. Such findings are binding and
conclusive on this Court."
Accordingly, this Court finds no reason to disturb the findings of the
Court of Appeals, which affirmed the findings of the trial court, that
petitioner is neither a mortgagee in good faith nor an innocent purchaser
for value.

2. No. Petitioner is not entitled to the award of damages. In its

Decision, the trial court ordered respondents Nenita and Eduardo to pay
petitioner damages in the amount equivalent to the appraised value of the
property being claimed by respondent Musni. The Court of Appeals

461
deleted the award. It considered the grant of award as a partial
extinguishment of the real estate mortgage, which is not allowed. Since
the mortgage is indivisible, the Court of Appeals nullified the real estate
mortgage involving the two properties, and deleted the award.

Although the Court of Appeals' basis for deleting the award is erroneous,
this Court affirms the removal on a different ground since petitioner did
not seek relief from the Court with clean hands. Petitioner may have
incurred losses when it entered into the mortgage transaction with
respondents Spouses Santos and Eduardo, and the corresponding
foreclosure sale. However, the losses could have been avoided if only
petitioner exercised the required due diligence.

462
 CABAHUG vs. PEOPLE OF THE PHILIPPINES, et al.

G.R. No. 132816

February 5, 2002

J. Leonen

DOCTRINE:
While procedural rules should be treated with utmost respect since they serve to
facilitate the adjudication of cases in support of the speedy disposition of cases
mandated by the Constitution, “[a] liberal interpretation . . . of the rules of
procedure can be resorted to only in proper cases and under justifiable causes and
circumstances.”

FACTS:
A negotiated contract was entered into by the Department of
Education, Culture and Sports (DECS), represented by petitioner Susana
B. Cabahug, by virtue of her position as Department of Education,
Culture and Sports Director for Region XI, for the purchase of 46,000 units
of topaz Monobloc Armchairs from Rubber worth Industries Corporation
(RWIC), at P495 per unit. The negotiated contract was approved by
Ricardo T. Gloria, then Secretary of the DECS.

Before the consummation of the contract, another DECS supplier, Jesusa

T. dela Cruz wrote to Secretary Gloria objecting to the said contract for
the reason that the chairs were patently overpriced. The letter was
referred to Antonio E.B. Nachura, DECS Undersecretary for Legal Affairs,
who after requiring petitioner Cabahug to comment on said letter,
resolved to give due course to the transaction. Consequently, a complaint
was filed by dela Cruz before the Office of the Ombudsman-Mindanao,
against petitioner Cabahug, Secretary Gloria, and Undersecretary
Nachura.

463
The Office of the Ombudsman through Jovito Coresis, Jr., issued a
Resolution finding probable cause and recommending the filing of
Information with the Sandiganbayan by the Office of the Special
Prosecutor and the dismissal of the case against Secretary Gloria and
Undersecretary Nachura. Unaware of the Information filed before the
Sandiganbayan, petitioner filed a Motion for Reconsideration before the
Office of the Special Prosecutor.

After learning of the filing of the Information with the Sandiganbayan,

petitioner filed a Motion for Reinvestigation. Petitioner prayed that the
Motion for Reconsideration filed before the Office of the Special
Prosecutor be admitted by the graft court as her Motion for
Reinvestigation. The Third Division of the Sandiganbayan granted the
Motion for Reconsideration.

Accordingly, the case was evaluated by the Office of the Special

Prosecutor. Cicero D. Jurado, Jr., Special Prosecution Officer (SPO) II
assigned to review the case, recommended dismissal of the case, there
being no showing that petitioner acted in bad faith or with gross
negligence. While Special Prosecutor Leonardo P. Tamayo and his
Deputy Robert E. Kallos, concurred in the findings, Ombudsman Aniano
Disierto did not agree. Noting that bad faith and/or gross inexcusable
negligence is deducible from the acts of the accused, Ombudsman
Disierto ordered prosecution to proceed.

To this petitioner filed a Motion for Re-determination of Existence of

Probable Cause. This motion was denied by the Sandiganbayan and
treated the same as a second Motion for Reconsideration which is not
allowed by the Rules of Court. Petitioner filed a Very Urgent Motion for
Reconsideration arguing therein that the said motion cannot be
considered a second motion for reconsideration since it was addressed to
the court, and not anymore to the Office of the Special Prosecutor or the
Ombudsman. The motion was denied and so was the subsequent Very
Urgent Motion for Reconsideration.

ISSUE:
Whether or not the Sandiganbayan committed grave abuse of discretion.

464
RULING:
YES. While it is the function of the Ombudsman to determine whether or
not the petitioner should be subjected to the expense, rigors and
embarrassment of trial, he cannot do so arbitrarily. When at the outset
the evidence cannot sustain a prima facie case or that the existence of
probable cause to form a sufficient belief as to the guilt of the accused
cannot be ascertained, the prosecution must desist from inflicting on any
person the trauma of going through a trial.

There is nothing in the records that show Cabahug acted in bad faith or
even with gross inexcusable negligence. In the absence of bad faith, she
cannot be held liable for violation of Section 3(e) of RA 3019, as amended.

Judicial power of review includes the determination of whether there was

grave abuse of discretion amounting to lack or excess of jurisdiction on
the part of any branch or instrumentality of the government [Section 1(2)
Article VIII 1987 Constitution]. Under this definition, the Sandiganbayan
should have, considering the divergent positions in the Office of the
Ombudsman, granted the motion for redetermination of probable cause
after reviewing the evidence thus far submitted, and dismissed the case
against petitioner. Thus, respondent court committed grave abuse of
discretion in allowing the case to proceed.

465
 NATIONAL POWER CORPORATION, Petitioner,
v.
PROVINCIAL GOVERNMENT OF BATAAN, SANGGUNIANG
PANLALAWIGAN OF BATAAN, PASTOR B. VICHUACO (IN HIS
OFFICIAL CAPACITY AS PROVINCIAL TREASURER OF BATAAN)
AND THE REGISTER OF DEEDS OF THE PROVINCE OF
BATAAN, Respondents.

G.R. No. 180654

March 06, 2017

LEONEN, J.

DOCTRINE:
Basic is the rule that allegations in the complaint and the character of the relief
sought determine the nature of an action.

A real party in interest is the party who stands to be benefited or injured by the
judgment in the suit, or the party entitled to the avails of the suit.

FACTS:
The Provincial Government of Bataan (Bataan) issued an assessment
against the National Power Corporation (Napocor) based on the sale of
electricity generated from two power plants within the province. Napocor
did not pay the assessments hence Bataan sold its property in a
foreclosure sale. Napocor filed before the RTC an action to annul the
foreclosure sale of its property arguing that under EPIRA, power
generation does not require a franchise, hence, not taxable. The RTC
dismissed Napocor’s petition. Napocor appealed before the CA, which
was dismissed on the grounds of lack of jurisdiction over the subject
matter of the case. Although the petition was denominated declaration of
nullity of foreclosure sale, it was essentially a local tax case questioning
the imposition of the local franchise tax, hence, any appeal should be
lodged with the CTA. In a Decision dated April 21, 2014, the SC granted
the petition and set aside the resolution of the Court of Appeals. The
Court found the proceedings in the court a quo a nullity for failure to

466
include PSALM Corporation and TRANSCO, companies which were
indispensable parties to the case.

ISSUE:
Whether the CA is correct on dismissing the petition on the grounds of
lack of jurisdiction and whether Napocor is a real party in interest.

RULING:
The Court of Appeals correctly dismissed the appeal for lack of
jurisdiction. Republic Act No. 9282, which amended Republic Act No.
1125, took effect on April 23, 2004, and significantly expanded the extent
and scope of the cases that the Court of Tax Appeals was tasked to hear
and adjudicate. Under Section 7, paragraph (a)(3), the Court of Tax
Appeals is vested with the exclusive appellate jurisdiction over, among
others, appeals from the "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."

The case a quo is a local tax case that is within the exclusive appellate
jurisdiction of the Court of Tax Appeals. Parenthetically, the case arose
from the dispute between Napocor and respondents over the purported
franchise tax delinquency of Napocor. Although the complaint filed with
the trial court is a Petition for declaration of nullity of foreclosure sale with
prayer for preliminary mandatory injunction, a reading of the petition shows
that it essentially assails the correctness of the local franchise tax
assessments by the Provincial Government of Bataan. Indeed, one of the
prayers in the petition is for the court a quo to declare Napocor "as exempt
from payment of local franchise taxes." Basic is the rule that allegations in
the complaint and the character of the relief sought determine the nature
of an action.

A real party in interest is the party who stands to be benefited or injured

by the judgment in the suit, or the party entitled to the avails of the
suit. In the instant case, petitioner's complaint has sought not only the
nullification of the foreclosure sale but also a declaration from the trial
court that it is exempt from the local franchise tax. The action began when
respondent ignored petitioner's claim for exemption from franchise tax,

467
and pursued its collection of the franchise tax delinquency by issuing the
warrant of levy and conducting the sale at public auction – where the
Provincial Government of Bataan was declared as purchaser – of the
transmission assets, despite the purported prior mutual agreement to
suspend administrative remedies for the collection of taxes. The assets
were sold to enforce collection of a franchise tax delinquency against the
petitioner. Petitioner thus had to assail the correctness of the local
franchise tax assessments made against it by instituting the complaint
with the Regional Trial Court; otherwise, the assessment would become
conclusive and unappealable. Certainly, petitioner is a real party in
interest, which stands to gain or lose from the judgment that the trial
court may render.

468
 CAPISTRANO DAAYATA, DEXTER SALISI, AND BREGIDO
MALACAT, JR., Petitioners,
v.
PEOPLE OF THE PHILIPPINES, Respondent.

G.R. No. 205745

March 08, 2017

LEONEN, J.

DOCTRINE:
It is basic that Rule 45 petitions may only raise pure questions of law, and that
the factual findings of lower courts are generally binding and conclusive on this
Court. Still, there are recognized exceptions permitting this Court to overturn
the factual findings with which it is confronted. These exceptions are:

(1) When the conclusion is a finding grounded entirely on speculation, surmises

and conjectures;

(2) When the inference made is manifestly mistaken, absurd or impossible;

(3) Where there is a grave abuse of discretion;

(4) When the judgment is based on a misapprehension of facts;

(5) When the findings of fact are conflicting;

(6) When the Court of Appeals, in making its findings, went beyond the issues of
the case and the same is contrary to the admissions of both appellant and appellee;

(7) When the findings are contrary to those of the trial court;

(8) When the findings of fact are conclusions without citation of specific evidence
on which they are based;

(9) When the facts set forth in the petition as well as in the petitioners' main and
reply briefs are not disputed by the respondents; and

469
(10) When the findings of fact of the Court of Appeals are premised on the
supposed absence of evidence and contradicted by the evidence on record.

Specifically concerning criminal cases, this Court has stated that "in exceptional
circumstances, such as when the trial court overlooked material and relevant
matters . . . this Court will re-calibrate and evaluate the factual findings of the
[lower courts]."

FACTS:
The accused were charged with frustrated murder. According to the
prosecution on December 16, 1995 at about 6:00 PM Bahian (victim)
almost had an altercation with the accused in front of the Kagawad. The
Kagawad told the group that they should appear before the Barangay
Captain to resolve their issue. The next day, while the victim and
Kagawad were walking towards the house of the Barangay Captain, the
accused blocked their path and started mauling the victim with weapons.
The victim was rushed to the hospital and the Doctor said that the victim
almost died if not for the timely medical intervention. The defense claims
that while the accused were having coffee at Vicente’s house, the
Kagawad along with the victim appeared. The victim challenged Salisi to
a fist fight. Salisi obliged and when he took a swing to the victim, the
latter ducked lost his balance and fell on the pavement hitting his head.
The RTC and the CA convicted the accused for the crime charged.

ISSUE:
Notwithstanding the fact that both the RTC and CA had the same factual
conclusions, can the SC make a review of the facts in a petition for
Certiorari under Rule 45?

RULING:
Petitioners seek relief from this Court through a Petition for Review on
Certiorari under Rule 45 of the Rules of Court. It is basic that Rule 45
petitions may only raise pure questions of law, and that the factual
findings of lower courts are generally binding and conclusive on this
Court. Still, there are recognized exceptions permitting this Court to

470
overturn the factual findings with which it is confronted. These
exceptions are:
(1) When the conclusion is a finding grounded entirely on speculation,
surmises and conjectures;

(2) When the inference made is manifestly mistaken, absurd or

impossible;

(3) Where there is a grave abuse of discretion;

(4) When the judgment is based on a misapprehension of facts;

(5) When the findings of fact are conflicting;

(6) When the Court of Appeals, in making its findings, went beyond the
issues of the case and the same is contrary to the admissions of both
appellant and appellee;

(7) When the findings are contrary to those of the trial court;

(8) When the findings of fact are conclusions without citation of specific
evidence on which they are based;

(9) When the facts set forth in the petition as well as in the petitioners'
main and reply briefs are not disputed by the respondents; and

(10) When the findings of fact of the Court of Appeals are premised on the
supposed absence of evidence and contradicted by the evidence on
record.

Specifically concerning criminal cases, this Court has stated that "in
exceptional circumstances, such as when the trial court overlooked
material and relevant matters . . . this Court will re-calibrate and evaluate
the factual findings of the [lower courts]."

A careful review of this case and of the body of evidence that was
available for the Regional Trial Court's perusal reveals that there has been

471
a gross misapprehension of facts on the part of the Regional Trial Court
and the Court of Appeals. Thus, we reverse and acquit petitioners
Capistrano Daayata, Dexter Salisi, and Bregido Malacat, Jr. [The SC at this
point proceeded to analyze Prosecution’s evidence and noted that the
victim himself admitted in cross-examination that he told the Doctor
operation on him that he hit his head on the pavement. The injury stated
in the medical certificate was consistent with the narration of events by
the defense. The testimony of the Barangay Captain also corroborated the
defense evidence]

472
 MIGUEL "LUCKY" GUILLERMO and AV MANILA CREATIVE
PRODUCTION CO., Petitioners
vs
PHILIPPINE INFORMATION AGENCY and DEPARTMENT OF
PUBLIC WORKS AND HIGHWAYS, Respondents

G.R. No. 223751

March 15, 2017

LEONEN, J.

DOCTRINE:
In determining the sufficiency of a cause of action for resolving a motion to
dismiss, a court must determine, hypothetically admitting the factual allegations
in a complaint, whether it can grant the prayer in the complaint.

A complaint states a cause of action if it sufficiently avers the existence of the

three (3) essential elements of a cause of action, namely: (a) a right in favor of the
plaintiff by whatever means and under whatever law it arises or is created; (b) an
obligation on the part of the named defendant to respect or not to violate such
right; and (c) an act or omission on the part of the named defendant violative of
the right of the plaintiff or constituting a breach of the obligation of defendant to
the plaintiff for which the latter may maintain an action for recovery of damages.
If the allegations of the complaint do not state the concurrence of these elements,
the complaint becomes vulnerable to a motion to dismiss on the ground of failure
to state a cause of action.

It is well to point out that the plaintiff's cause of action should not merely be
"stated" but, importantly, the statement thereof should be "sufficient." This is
why the elementary test in a motion to dismiss on such ground is whether or not
the complaint alleges facts which if true would justify the relief demanded. As a
corollary, it has been held that only ultimate facts and not legal conclusions or
evidentiary facts are considered for purposes of applying the test. This is
consistent with Section 1, Rule 8 of the Rules of Court which states that the
complaint need only allege the ultimate facts or the essential facts constituting
the plaintiffs cause of action. A fact is essential if they cannot be stricken out
without leaving the statement of the cause of action inadequate. Since the inquiry

473
is into the sufficiency, not the veracity, of the material allegations, it follows that
the analysis should be confined to the four comers of the complaint, and no other.

FACTS:

Petitioners produced a documentary and comics about the

achievements of the Arroyo administration at the request of the DPWH
secretary. The Executive Assistant of the Philippine Information Agency
told the Petitioners that since their proposal was already approved thru a
memorandum hence no contract was necessary. Upon delivery of the said
materials to the DPWH (10,000 copies of the documentary) and Philippine
Information Agency (5,000 copies of comics), the Petitioners billed the
DPWH Php15 M and the Philippine Information Agency Php 10 M. The
two agencies did not pay Petitioner which constrained the latter to file an
action for collection of sum of money with damages against the said
agencies. The OSG moved to dismiss the complaint for failure to state a
cause of action and for failure to exhaust administrative remedies. The
RTC dismissed the actions. The CA affirmed the dismissal and stated that
the Petitioner’s complaint sought to enforce a legal right based on a
contract but they failed to establish the existence of the said contract.

ISSUE:
Whether the complaint was properly dismissed for failure to state a cause
of action

RULING:
In Zuniga-Santos v. Santos-Gran: A complaint states a cause of action if it
sufficiently avers the existence of the three (3) essential elements of a
cause of action, namely: (a) a right in favor of the plaintiff by whatever
means and under whatever law it arises or is created; (b) an obligation on
the part of the named defendant to respect or not to violate such right;
and (c) an act or omission on the part of the named defendant violative of
the right of the plaintiff or constituting a breach of the obligation of
defendant to the plaintiff for which the latter may maintain an action for
recovery of damages. If the allegations of the complaint do not state the
concurrence of these elements, the complaint becomes vulnerable to a
motion to dismiss on the ground of failure to state a cause of action.

474
It is well to point out that the plaintiff's cause of action should not merely
be "stated" but, importantly, the statement thereof should be "sufficient."
This is why the elementary test in a motion to dismiss on such ground is
whether or not the complaint alleges facts which if true would justify the
relief demanded. As a corollary, it has been held that only ultimate facts
and not legal conclusions or evidentiary facts are considered for purposes
of applying the test. This is consistent with Section 1, Rule 8 of the Rules
of Court which states that the complaint need only allege the ultimate
facts or the essential facts constituting the plaintiffs cause of action. A fact
is essential if they cannot be stricken out without leaving the statement of
the cause of action inadequate. Since the inquiry is into the sufficiency,
not the veracity, of the material allegations, it follows that the analysis
should be confined to the four comers of the complaint, and no other.

Thus, to determine the sufficiency of a cause of action in a motion to

dismiss, only the facts alleged in the complaint should be considered, in
relation to whether its prayer may be granted.

In Heirs of Maramag v. Maramag: When a motion to dismiss is premised on

this ground, the ruling thereon should be based only on the facts alleged
in the complaint. The court must resolve the issue on the strength of such
allegations, assuming them to be true. The test of sufficiency of a cause of
action rests on whether, hypothetically admitting the facts alleged in the
complaint to be true, the court can render a valid judgment upon the
same, in accordance with the prayer in the complaint. This is the general
rule.

To sufficiently state a cause of action, the Complaint should have alleged

facts showing that the trial court could grant its prayer based on the
strength of its factual allegations.

The Complaint in this case prayed:

WHEREFORE, premises considered, it is respectfully prayed of this

Honorable Court that, after proper proceedings, judgment be rendered
ordering the defendants to jointly and severally:

475
1. Pay the plaintiffs the amount of PESOS: TWENTY-FIVE MILLION
(Php25,000,000.00) to cover plaintiffs' services and the delivered items
which were received and used by the defendants as above-mentioned;

2. Pay the plaintiff Guillermo an amount of not less than PESOS: ONE
HUNDRED THOUSAND (₱l00,000.00) as and by way of moral damages;

3. Pay the plaintiffs an amount of not less than PESOS: ONE HUNDRED
THOUSAND (₱l00,000.00) as and by way of exemplary or corrective
damages;

4. Pay the plaintiffs an amount of not less than PESOS: ONE HUNDRED
THOUSAND (₱l00,000.00) as and by way of attorney's fees and litigation
expenses; and

5. Pay the cost of the suit.

To support the foregoing prayer, the Complaint attempted to lay down

the elements of a contract between the petitioners on one hand, and
respondents on the other. Thus, it alleged a series of communications,
meetings, and memoranda, all tending to show that petitioners agreed to
complete and deliver the "Joyride" project, and that respondents agreed to
pay ₱25,000,000.00 as consideration.

Assuming that the Complaint's factual allegations are true, they are not
sufficient to establish that the Regional Trial Court could grant its prayer.
The Complaint attempts to establish a contract that involves expenditure
of public funds.

As pointed out by respondents, contracts involving the expenditure of

public funds have additional requisites to be valid. In Philippine National
Railways v. Kanlaon Construction Enterprises Co., lnc., this Court has held
that contracts that do not comply with the foregoing requirements are
void:
Thus, the Administrative Code of 1987 expressly prohibits the entering
into contracts involving the expenditure of public funds unless two prior

476
requirements are satisfied. First, there must be an appropriation law
authorizing the expenditure required in the contract. Second, there must
be attached to the contract a certification by the proper accounting official
and auditor that funds have been appropriated by law and such funds are
available. Failure to comply with any of these two requirements renders
the contract void.

The Complaint, however, completely ignored the foregoing requisites for

the validity of contracts involving expenditure of public funds. Thus, the
Regional Trial Court could not order the enforcement of the alleged
contract on the basis of the Complaint, and the Complaint was properly
dismissed for failure to state a cause of action.

477
 SPS. ROBERTO ABOITIZ AND MARIA CRISTINA
CABARRUS, Petitioners
vs.
SPS. PETER L. PO AND VICTORIA L. PO, Respondents

G.R. No. 208450

June 5, 2017

LEONEN, J.

DOCTRINE:
An action for annulment of judgment is a remedy in equity so exceptional in
nature that it may be availed of only when other remedies are wanting, and only
if the judgment, final order or final resolution sought to be annulled was rendered
by a court lacking jurisdiction or through extrinsic fraud. An action for
reconveyance, on the other hand, is a legal and equitable remedy granted to the
rightful owner of land which has been wrongfully or erroneously registered in the
name of another for the purpose of compelling the latter to transfer or reconvey
the land to him. The Court of Appeals has exclusive original jurisdiction over
actions for annulment of judgments of Regional Trial Courts whereas actions for
reconveyance of real property may be filed before the Regional Trial Courts or the
Municipal Trial Courts, depending on the assessed value of the property
involved.

FACTS:
This case involves a parcel of land registered to Roberto Aboitiz.
The land originally belonged to Mariano Seno. In 1973, Seno sold to his
son Ciriaco Seno the subject lot who in turn sold the lot to Victoria Po. In
1990 Sps. Po discovered that the Ciriaco executed a quitclaim of his
interest over the subject lot in favor of Robrerto. However, in the same
year the same lot was sold to Roberto by the heirs of Mariano. Roberto
filed an application for original registration of the lot before Br. 28 RTC
Mandaue City which was granted. Spouses Po filed a complaint to
recover the land and to declare nullity of title with damages which was
docketed with Br. 55 RTC Mandaue City which was granted. The Sps.
Aboitiz appealed to the CA which affirmed the decision of the RTC
finding the Sps. Po the rightful owner of the land. On appeal to the SC the

478
Sps. Aboitiz argues that the Decision of Branch 55, Regional Trial Court of
Mandaue City granting the complaint of the Spouses Po is void for lack of
jurisdiction over the matter. They claim that a branch of the Regional Trial
Court has no jurisdiction to nullify a final and executory decision of a co-
equal branch; it is the Court of Appeals that has this jurisdiction.

ISSUE:
Whether Br. 55 RTC has jurisdiction over the case filed by the Sps. Po.

RULING:
The Spouses Aboitiz argue that Branch 55, Regional Trial Court did not
have jurisdiction to nullify the final and executory Decision of Branch 28,
Regional Trial Court in LRC Case No. N-208. They claim that that it is the
Court of Appeals that has jurisdiction to annul judgments of the Regional
Trial Court. However, the instant action is not for the annulment of
judgment of a Regional Trial Court. It is a complaint for reconveyance,
cancellation of title, and damages.

A complaint for reconveyance is an action which admits the registration

of title of another party but claims that such registration was erroneous or
wrongful. It seeks the transfer of the title to the rightful and legal owner,
or to the party who has a superior right over it, without prejudice to
innocent purchasers in good faith. It seeks the transfer of a title issued in a
valid proceeding. The relief prayed for may be granted on the basis of
intrinsic fraud-fraud committed on the true owner instead of fraud
committed on the procedure amounting to lack of jurisdiction.

An action for annulment of title questions the validity of the title because
of lack of due process of law. There is an allegation of nullity in the
procedure and thus the invalidity of the title that is issued.

The complaint of the Spouses Po asserted that they were the true owners
of the parcel of land which was registered in the name of the Spouses
Aboitiz. They alleged that they acquired the property from Ciriaco, who
acquired it from Mariano. They claimed that the Spouses Aboitiz had the
property registered without their knowledge and through fraud. Thus,

479
they sought to recover the property and to cancel the title of the Spouses
Aboitiz.

An action for reconveyance and annulment of title is an action involving

the title to real property. The complaint of the Spouses Po is clearly an
action for reconveyance and annulment of title. Thus, the Regional Trial
Court has jurisdiction to hear the case. The Spouses Aboitiz claim that it is
the Court of Appeals that has jurisdiction over the annulment of Regional
Trial Court judgments.

While the Court of Appeals has jurisdiction to annul judgments of the

Regional Trial Courts, the case at bar is not for the annulment of
a judgment of a Regional Trial Court. It is for reconveyance and the
annulment of title. The difference between these two (2) actions was
discussed in Toledo v. Court of Appeals:

An action for annulment of judgment is a remedy in equity so exceptional

in nature that it may be availed of only when other remedies are wanting,
and only if the judgment, final order or final resolution sought to be
annulled was rendered by a court lacking jurisdiction or through extrinsic
fraud. An action for reconveyance, on the other hand, is a legal and
equitable remedy granted to the rightful owner of land which has been
wrongfully or erroneously registered in the name of another for the
purpose of compelling the latter to transfer or reconvey the land to him.
The Court of Appeals has exclusive original jurisdiction over actions for
annulment of judgments of Regional Trial Courts whereas actions for
reconveyance of real property may be filed before the Regional Trial
Courts or the Municipal Trial Courts, depending on the assessed value of
the property involved.

Petitioners allege that: first, they are the owners of the land by virtue of a
sale between their and respondents' predecessors-in-interest; and second,
that respondents Ramoses and ARC Marketing illegally dispossessed
them by having the same property registered in respondents' names.
Thus, far from establishing a case for annulment of judgment, the
foregoing allegations clearly show a case for reconveyance.

480
As stated, a complaint for reconveyance is a remedy where the plaintiff
argues for an order for the defendant to transfer its title issued in a
proceeding not otherwise invalid. The relief prayed for may be granted on
the basis of intrinsic rather than extrinsic fraud; that is, fraud committed
on the real owner rather than fraud committed on the procedure
amounting to lack of jurisdiction.

An action for annulment of title, on the other hand, questions the validity
of the grant of title on grounds which amount to lack of due process of
law. The remedy is premised in the nullity of the procedure and thus the
invalidity of the title that is issued. Title that is invalidated as a result of a
successful action for annulment against the decision of a Regional Trial
Court acting as a land registration court may still however be granted on
the merits in another proceeding not infected by lack of jurisdiction or
extrinsic fraud if its legal basis on the merits is properly alleged and
proven.

Considering the Spouses Aboitiz's fraudulent registration without the

Spouses Po's knowledge and the latter's assertion of their ownership of
the land, their right to recover the property and to cancel the Spouses
Aboitiz' s88 title, the action is for reconveyance and annulment of title and
not for annulment of judgment.

Thus, the Regional Trial Court has jurisdiction to hear this case.

481
 CHIQUITA BRANDS, INC. AND CHIQUITA BRANDS
INTERNATIONAL, INC., Petitioners,
v.

HON. GEORGE E. OMELIO, REGIONAL TRIAL COURT, DAVAO

CITY, BRANCH 14, SHERIFF ROBERTO C. ESGUERRA, CECILIO G.
ABENION, AND 1,842 OTHER PLAINTIFFS IN CIVIL CASE NO. 95-
45, Respondents.

G.R. No. 189102

June 07, 2017

LEONEN, J.
DOCTRINE:
The doctrine on hierarchy of courts prohibits "parties from directly resorting to
this Court when relief may be obtained before the lower courts.” This rule is
founded upon judicial economy and practical considerations. On the one hand, it
allows this Court to devote its time and attention to those matters falling within
its exclusive jurisdiction. It also "prevent[s] the congestion of th[is] Court's
dockets." On the other hand, it "ensure[s] that every level of the judiciary
performs its designated roles in an effective and efficient manner.” The doctrine
on hierarchy of courts was designed to promote order and efficiency.

Generally, this Court will dismiss petitions that are directly filed before it if relief
can be obtained from the lower courts. Trial courts and the Court of Appeals are
"in the best position to deal with causes in the first instance.” They not only
resolve questions of law but also determine facts based on the evidence presented
before them.

Nevertheless, a direct invocation of this Court's original jurisdiction may be

justified "when there are compelling reasons clearly set forth in the petition."
Immediate resort to this Court may be warranted: (1) when genuine issues of
constitutionality are raised that must be addressed immediately; (2) when the
case involves transcendental importance; (3) when the case is novel; (4) when the
constitutional issues raised are better decided by this Court; (5) when time is of
the essence; (6) when the subject of review involves acts of a constitutional organ;
(7) when there is no other plain, speedy, adequate remedy in the ordinary course

482
 of law; (8) when the petition includes questions that may affect public welfare,
public policy, or demanded by the broader interest of justice; (9) when the order
complained of was a patent nullity; and (10) when the appeal was considered as
an inappropriate remedy.

In any case, a compromise validly entered into has the authority and effect of res
judicata as between the parties.

However, unlike an extrajudicial compromise, a compromise that has received

judicial imprimatur "becomes more than a mere contract." A judicial compromise
is regarded as a "determination of the controversy" between the parties and "has
the force and effect of [a final] judgment." In other words, it is both a contract
and "a judgment on the merits." It may neither be disturbed nor set aside except
in cases where there is forgery or when either of the parties' consent has been
vitiated.

The doctrine on immutability of judgments applies to compromise agreements

approved by the courts in the same manner that it applies to judgments that have
been rendered on the basis of a full-blown trial. Thus, a judgment on compromise
that has attained finality cannot be "modified in any respect, even if the
modification is meant to correct erroneous conclusions of fact and law, and
whether it be made by the court that rendered it or by the Highest Court of the
land."

FACTS:

A class suit was instituted by several banana plantation workers

against herein petitioners on the ground that the pesticides that they have
been using in the plantation caused their sterility. A compromise
agreement was struck between the parties wherein the petitioners will
deposit in an escrow account the damages which shall be released by the
mediator to the claimants. Eventually the claimants filed a motion for
execution of the compromise agreement which the petitioners opposed
because they allege that they have already deposited the amount to the
escrow account as agreed upon. Respondent judge issued an order for
execution ordering petitioners to directly pay the claimants the amount
agreed upon in the compromise agreement. The claimants argue in part

483
that the Petitioners violated the doctrine of hierarchy of courts for filing
directly with the SC their petition.

ISSUE:
Whether petitioners violated the doctrine of hierarchy of courts and
whether an order for execution may amend the terms of a compromise
agreement.

RULING:
The doctrine on hierarchy of courts prohibits "parties from directly
resorting to this Court when relief may be obtained before the lower
courts." This rule is founded upon judicial economy and practical
considerations. On the one hand, it allows this Court to devote its time
and attention to those matters falling within its exclusive jurisdiction. It
also "prevent[s] the congestion of th[is] Court's dockets." On the other
hand, it "ensure[s] that every level of the judiciary performs its designated
roles in an effective and efficient manner." The doctrine on hierarchy of
courts was designed to promote order and efficiency.

Although this Court has the power to Issue extraordinary writs of

certiorari, prohibition, and mandamus, it is by no means an exclusive
power. "[I]t is shared [concurrently] with the Court of Appeals and the
Regional Trial Courts." However, "[p]arties cannot randomly select the ...
forum to which their [petitions] will be directed.” The doctrine on
hierarchy of courts determines the proper venue or choice of forum where
petitions for certiorari, prohibition, and mandamus should be filed.

Generally, this Court will dismiss petitions that are directly filed before it
if relief can be obtained from the lower courts. Trial courts and the Court
of Appeals are "in the best position to deal with causes in the first
instance." They not only resolve questions of law but also determine facts
based on the evidence presented before them.

Nevertheless, a direct invocation of this Court's original jurisdiction may

be justified "when there are compelling reasons clearly set forth in the
petition." Immediate resort to this Court may be warranted:

484
(1) when genuine issues of constitutionality are raised that must be
addressed immediately; (2) when the case involves transcendental
importance; (3) when the case is novel; (4) when the constitutional issues
raised are better decided by this Court; (5) when time is of the essence; (6)
when the subject of review involves acts of a constitutional organ; (7)
when there is no other plain, speedy, adequate remedy in the ordinary
course of law; (8) when the petition includes questions that may affect
public welfare, public policy, or demanded by the broader interest of
justice; (9) when the order complained of was a patent nullity; and (10)
when the appeal was considered as an inappropriate remedy.

We may take cognizance of this case "in the interest of judicial economy
and efficiency." The records of this case are sufficient for this Court to
decide on the issues raised by the parties. Any further delay would
unduly prejudice the parties.

A compromise is defined under the Civil Code as "a contract whereby the
parties, by making reciprocal concessions, avoid a litigation or put an end
to one already commenced." It may either be judicial or extrajudicial
depending on its object or the purpose of the parties. A compromise is
judicial if the parties' purpose is to terminate a suit already commenced.
On the other hand, a compromise is extrajudicial if its object is to avoid
litigation.

In any case, a compromise validly entered into has the authority and
effect of res judicata as between the parties. To this extent, a judicial
compromise and an extrajudicial compromise are no different from each
other.

However, unlike an extrajudicial compromise, a compromise that has

received judicial imprimatur "becomes more than a mere contract." A
judicial compromise is regarded as a "determination of the controversy"
between the parties and "has the force and effect of [a final] judgment." In
other words, it is both a contract and "a judgment on the merits." It may
neither be disturbed nor set aside except in cases where there is forgery or
when either of the parties' consent has been vitiated.

485
The doctrine on immutability of judgments applies to compromise
agreements approved by the courts in the same manner that it applies to
judgments that have been rendered on the basis of a full-blown trial.
Thus, a judgment on compromise that has attained finality cannot be
"modified in any respect, even if the modification is meant to correct
erroneous conclusions of fact and law, and whether it be made by the
court that rendered it or by the Highest Court of the land."

A judgment on compromise may be executed just like any other final

judgment in the manner provided in the Rules of Court. The writ of
execution derives its validity from the judgment it seeks to enforce and
must essentially conform to the judgment's terms. It can neither be wider
in scope nor exceed the judgment that gives it life. Otherwise, it has no
validity. Thus, in issuing writs of execution, courts must look at the terms
of the judgment sought to be enforced.

The Writ of Execution ordering the collection of the settlement amount

directly from petitioners and its co-defendants in Civil Case No. 95-45 is
void.

Under the judicially approved Compromise Agreement, petitioners are

obliged to deposit the settlement amount in escrow within 10 business
days after they receive a signed Compromise Agreement from the counsel
of the claimants.

There was nothing in the Compromise Agreement that required

petitioners to ensure the distribution of the settlement amount to each
claimant. Petitioners' obligation under the Compromise Agreement was
limited to depositing the settlement amount in escrow. On the other hand,
the actual distribution of the settlement amounts was delegated to the
chosen mediator, Mr. Mills. To require proof that the settlement amounts
have been withdrawn and delivered to each claimant would enlarge the
obligation of petitioners under the Compromise Agreement.

Consequently, the Omnibus Order dated December 14, 2006, which

directed the implementation of the Writ of Execution, is likewise void.

486
Ordinarily, courts have the ministerial duty to grant the execution of a
final judgment. The prevailing party may immediately move for
execution of the judgment, and the issuance of the writ follows as a matter
of course. Execution, being "the final stage of litigation ... [cannot] be
frustrated."

Nevertheless, the execution of a final judgment may be stayed or set aside

in certain cases. "Courts have jurisdiction to entertain motions to quash
previously issued writs of execution[.]" They "have the inherent power,
for the advancement of justice, to correct the errors of their ministerial
officers and to control their own processes."

A writ of execution may be stayed or quashed when "facts and

circumstances transpire" after judgment has been rendered that would
make "execution impossible or unjust."

Another exception is when the writ of execution alters or varies the

judgment. A writ of execution derives its validity from the judgment it
seeks to enforce. Hence, it should not "vary terms of the judgment ... [or]
go beyond its terms." Otherwise, the writ of execution is void. Courts can
neither modify nor "impose terms different from the terms of a
compromise agreement" that parties have entered in good faith. To do so
would amount to grave abuse of discretion.

Payment or satisfaction of the judgment debt also constitutes as a ground

for the quashal of a writ of execution.

A writ of execution may also be set aside or quashed when it appears

from the circumstances of the case that the writ "is defective in substance,"
"has been improvidently issued," issued without authority,251 or was
"issued against the wrong party."

The party assailing the propriety of the issuance of the writ of execution
must adduce sufficient evidence to support his or her motion. This may
consist of affidavits and other documents.

487
On the other hand, in resolving whether execution should be suspended
or whether a writ of execution should be quashed, courts should be
guided by the same principle in the execution of final judgments.
Certainly, they may require parties to present evidence.

In this case, petitioners cannot rely on the five (5) quitclaims for the trial
court to quash or recall the writ of execution. The quitclaims are
insufficient to establish that petitioners complied with their obligation
under the Compromise Agreement. They only prove that five (5)
claimants received their respective share in the settlement amount but do
not establish that petitioners deposited the entire settlement amount in
escrow. At the very least, petitioners should have attached proof of actual
deposit in their Opposition to the Motion for Execution.

Respondent court's fervor in ordering the execution of the compromise

agreement appears to be fueled by its compassion towards the workers
who have allegedly been exposed to DBCP. However, prudence and
judicial restraint dictate that a court's sympathy towards litigants should
yield to established legal rules. Moreover, this jurisdiction should not
alter the mechanism established for claims here and abroad as it can undo
the entire process for all the farmers involved. The remedy of any unpaid
claimant would be to establish their claims with the mediator named in
the Compromise Agreement. Counsels for the farmers and their families
should have followed this clear, legal course mandated in the
Compromise Agreement. This would have abbreviated the further
suffering of the respondents.

488
 MARIO VERIDIANO Y SAPI VS. PEOPLE OF THE PHILIPPINES

G.R. No. 200370

June 7, 2017

LEONEN, J.:

DOCTRINE:
“A hearsay tip by itself does not justify a warrantless arrest. Law enforcers must
have personal knowledge of facts, based on their observation, that the person
sought to be arrested has just committed a crime.”

FACTS:

In the Municipality of Nagcarlan, Province of Laguna and within

the jurisdiction of this Honorable Court, the above-named accused, not
being permitted or authorized by law, did then and there willfully,
unlawfully and feloniously have in his possession, control and custody
one (1) small heatsealed transparent plastic sachet containing 2.72 grams
of dried marijuana leaves, a dangerous drug.

Veridiano was arraigned. He pleaded not guilty to the offense charged.

During trial, the prosecution presented PO1 Cabello and PO1 Solano to
testify.

According to the prosecution, at about 7:20 a.m. of January 15, 2008, a

concerned citizen called a certain PO3 Esteves, police radio operator of
the Nagcarlan Police Station, informing him that a certain alias "Baho,"
who was later identified as Veridiano, was on the way to San Pablo City
to obtain illegal drugs.

PO3 Esteves immediately relayed the information to PO1 Cabello and

PO2 Alvin Vergara (PO2 Vergara) who were both on duty.

489
Chief of Police June Urquia instructed PO1 Cabello and PO2 Vergara to
set up a checkpoint at Barangay Taytay, Nagcarlan, Laguna.

At around 10:00 a.m., they chanced upon Veridiano inside a passenger

jeepney coming from San Pablo, Laguna.

The police officers instructed the passengers to raise their t-shirts to check
for possible concealed weapons and to remove the contents of their
pockets. They recovered from Veridiano "a tea bag containing what
appeared to be marijuana." POI Cabello confiscated the tea bag and
marked it with his initials. Veridiano was arrested and apprised of his
constitutional rights. He was then brought to the police station.

Before the Regional Trial Court of San Pablo City, Laguna, Veridiano was
charged with the crime of illegal possession of dangerous drugs.

The Court of Appeals found that "Veridiano was caught in flagrante

delicto" of having marijuana in his possession.

Veridiano filed a Petition for Review on Certiorari.

ISSUE:

Whether or not there was a valid warrantless arrest that would vest the
court with jurisdiction over the person of the accused.

RULING:

No, Petitioner's warrantless arrest was unlawful.

The invalidity of an arrest leads to several consequences among which

are: (a) the failure to acquire jurisdiction over the person of an accused; (b)
criminal liability of law enforcers for illegal arrest; and (c) any search

490
incident to the arrest becomes invalid thus rendering the evidence
acquired as constitutionally inadmissible.

Lack of jurisdiction over the person of an accused as a result of an invalid

arrest must be raised through a motion to quash before an accused enters
his or her plea. Otherwise, the objection is deemed waived and an
accused is "estopped from questioning the legality of his arrest."

The voluntary submission of an accused to the jurisdiction of the court

and his or her active participation during trial cures any defect or
irregularity that may have attended an arrest. The reason for this rule is
that "the legality of an arrest affects only the jurisdiction of the court over
the person of the accused."

Nevertheless, failure to timely object to the illegality of an arrest does not

preclude an accused from questioning the admissibility of evidence
seized. The inadmissibility of the evidence is not affected when an
accused fails to question the court's jurisdiction over his or her person in a
timely manner. Jurisdiction over the person of an accused and the
constitutional inadmissibility of evidence are separate and mutually
exclusive consequences of an illegal arrest.

As to the legality of the search and seizure made:

A search incidental to a lawful arrest requires that there must first be a

lawful arrest before a search is made. Otherwise stated, a lawful arrest
must precede the search; "the process cannot be reversed." For there to be
a lawful arrest, law enforcers must be armed with a valid warrant.
Nevertheless, an arrest may also be effected without a warrant.

There are three (3) grounds that will justify a warrantless arrest. Rule 113,
Section 5 of the Revised Rules of Criminal Procedure provides:

Section 5. Arrest Without Warrant; When Lawful. — A peace officer or a

private person may, without a warrant, arrest a person: (a) When, in his

491
presence, the person to be arrested has committed, is actually committing,
or is attempting to commit an offense;

(b) When an offense has just been committed and he has probable cause
to believe based on personal knowledge of facts or circumstances that the
person to be arrested has committed it; and

(c) When the person to be arrested is a prisoner who has escaped from a
penal establishment or place where he is serving final judgment or is
temporarily confined while his case is pending, or has escaped while
being transferred from one confinement to another.

The first kind of warrantless arrest is known as an in flagrante delicto

arrest.

For a warrantless arrest of in flagrante delicto to be affected, "two

elements must concur: (1) the person to be arrested must execute an overt
act indicating that he [or she] has just committed, is actually committing,
or is attempting to commit a crime; and (2) such overt act is done in the
presence or within the view of the arresting officer."

In this case, petitioner's arrest could not be justified as an in flagrante

delicto arrest under Rule 113, Section 5(a) of the Rules of Court. He was
not committing a crime at the checkpoint. Petitioner was merely a
passenger who did not exhibit any unusual conduct in the presence of the
law enforcers that would incite suspicion. In effecting the warrantless
arrest, the police officers relied solely on the tip they received. Reliable
information alone is insufficient to support a warrantless arrest absent
any overt act from the person to be arrested indicating that a crime has
just been committed, was being committed, or is about to be committed.

The warrantless arrest cannot likewise be justified under Rule 113, Section
5(b) of the Revised Rules of Criminal Procedure. The law enforcers had no
personal knowledge of any fact or circumstance indicating that petitioner
had just committed an offense.

492
A hearsay tip by itself does not justify a warrantless arrest. Law enforcers
must have personal knowledge of facts, based on their observation, that
the person sought to be arrested has just committed a crime. This is what
gives rise to probable cause that would justify a warrantless search under
Rule 113, Section 5(b) of the Revised Rules of Criminal Procedure.

The warrantless search cannot be justified under the reasonable suspicion

requirement in "stop and frisk" searches. Law enforcers do not have
unbridled discretion in conducting "stop and frisk" searches. While
probable cause is not required, a "stop and frisk" search cannot be
validated on the basis of a suspicion or hunch. Law enforcers must have a
genuine reason to believe, based on their experience and the particular
circumstances of each case, that criminal activity may be afoot. Reliance
on one (1) suspicious activity alone, or none at all, cannot produce a
reasonable search.

Petitioner in this case was a mere passenger in a jeepney who did not
exhibit any act that would give police officers reasonable suspicion to
believe that he had drugs in his possession. Reasonable persons will act in
a nervous manner in any checkpoint. There was no evidence to show that
the police had basis or personal knowledge that would reasonably allow
them to infer anything suspicious.

Moreover, petitioner's silence or lack of resistance can hardly be

considered as consent to the warrantless search. Although the right
against unreasonable searches and seizures may be surrendered through
a valid waiver, the prosecution must prove that the waiver was executed
with clear and convincing evidence. Consent to a warrantless search and
seizure must be "unequivocal, specific, intelligently given . . . [and
unattended] by duress or coercion."

The validity of a consented warrantless search is determined by the

totality of the circumstances. This may involve an inquiry into the

493
environment in which the consent was given such as "the presence of
coercive police procedures."

The presence of a coercive environment negates the claim that petitioner

consented to the warrantless search.

Another instance of a valid warrantless search is a search of a moving

vehicle. Checkpoints per se are not invalid. They are allowed in
exceptional circumstances to protect the lives of individuals and ensure
their safety. They are also sanctioned in cases where the government's
survival is in danger. Considering that routine checkpoints intrude "on [a]
motorist's right to 'free passage'" to a certain extent, they must be
"conducted in a way least intrusive to motorists." The extent of routine
inspections must be limited to a visual search. Routine inspections do not
give law enforcers carte blanche to perform warrantless searches.

In the present case, the extensive search conducted by the police officers
exceeded the allowable limits of warrantless searches. They had no
probable cause to believe that the accused violated any law except for the
tip they received. They did not observe any peculiar activity from the
accused that may either arouse their suspicion or verify the tip. Moreover,
the search was flawed at its inception. The checkpoint was set up to target
the arrest of the accused.

Decision of the Regional Trial Court and Court of Appeals are REVERSED
and SET ASIDE. Petitioner is hereby ACQUITTED.

494
 LOLITA BAS CAPABLANCA vs. HEIRS OF PERDO BAS,
REPRESENTED BY JOSEFINA BAS ESPINOSA AND REGISTER OF
DEEDS OF THE PROVINCE OF CEBU

G.R. No. 224144

June 28, 2017

LEONEN, J.:

DOCTRINE:
The Court of Appeals' reliance on the ruling in Heirs of Yaptinchay v.Del
Rosario was misplaced. In that case, the motion to dismiss was filed immediately
after the second Amended Complaint was filed. The trial court granted the
motion to dismiss, holding that the Heirs of Yaptinchay "have not shown any
proof or even a semblance of it - except the allegations that they are the legal heirs
of the above-named Yaptinchays- that they have been declared the legal heirs of
the deceased couple.

Rule 9, Section 1 of the Rules of Court states, "[ d]efenses and objections not
pleaded either in a motion to dismiss or in the answer are deemed waived."

FACTS:

The subject matter of this case is Lot 2535 of the Talisay-Minglanilla

Friar Land's Estate located in "Biasong, Dumlog, Talisay, Cebu".

Andres Bas and Pedro Bas acquired Lot 2535, "and Patent No. 1724 was
issued in their names.

Pedro sold to Faustina Manreal, married to Juan Balorio, his portion of

Lot. The sale was evidenced by a notarized Deed of Sale.

After the death of Faustina and her husband, their heirs executed a
notarized Extra-Judicial Declaration of Heirs and Deed of Absolute Sale.

495
Lot 2535 consisting of "1,000 square meters, more or less," was conveyed
to one (1) of their heirs, Alejandra Balorio.

Alejandra sold the land through a Deed of Absolute Sale to Edith N.

Deen, who in turn sold it to Atty. Eddy A. Deen.

Upon Atty. Deen's death, an extra-judicial settlement of estate, which did

not include Lot 2535, was executed by his heirs. Later, they executed an
Additional Extra-Judicial Settlement with Absolute Deed of Sale, which
sold the land for ₱l0,000.00 to Norberto B. Bas, who took possession of
and built a house on it.

Norberto died without a will and was succeeded by his niece and only
heir, Lolita Bas Capablanca.

Subsequently, Lolita learned that a Transfer Certificate of Title (TCT) was

issued in the names of Andres and Pedro on the basis of a reconstituted
Deed of Conveyance.

Josefina Bas Espinosa represented the Heirs of Pedro Bas to file a

complaint for Clarification of Ownership of Lot against Lolita before the
Lupong Tagapamayapa. The conflict between the parties was not
resolved and resulted to the issuance of a Certification to file Action. A
notarized Partition Agreement of Real Property, Quitclaim and Waiver of
Rights was executed between the heirs of Andres and Lolita, representing
Norberto, whereby they partitioned Lot 2535 among themselves.

Lolita sought to register her portion in Lot 2535 but was denied by the
Register of Deeds of Cebu, citing the need for a court order. Lolita then
learned that TCT No. T-96676 had been partially cancelled and TCT Nos.
T-100181, T-100182, T-100183, and T-100185 had been issued in the name
of the Heirs of Pedro Bas, represented by Josefina, on May 29, 1997.

Lolita filed a complaint before the Regional Trial Court of Cebu City for
the cancellation of the titles.

496
Regional Trial Court rendered a Decision in favor of Lolita. The trial court
held that there was substantial evidence to prove that Lolita had been in
long possession of the lot under a claim of ownership as the heir of
Norberto and that it was not necessary for her to be first declared as his
heir before filing the complaint. It further ruled that to dismiss the case on
the ground that Lolita should first be declared an heir would be too late as
the Heirs of Pedro Bas did not raise the issue in a motion to dismiss or as
an affirmative defense in their complaint.

The Heirs of Pedro Bas appealed to the Court of Appeals, making the
following lone assignment of error:

The trial court seriously erred in not dismissing the case for plaintiffs lack
of cause of action considering that plaintiff in her complaint alleged, she is
the sole heir of Norberto Bas.

The Court of Appeals reversed the Regional Trial Court Decision and
dismissed the complaint. According to the Court of Appeals, Lolita must
first be declared as the sole heir to the estate of Norberto in a proper
special proceeding.

Hence, Lolita filed this Petition principally contending that the Court of
Appeals committed a reversible error in reversing the Regional Trial
Court Decision and dismissing the complaint.

ISSUE:

1.) Whether or not the CA dismissal of the complaint is proper?

2.) Whether or not a separate special proceeding is required to establish

filiation and heirship?

497
RULING:

1) Yes, This Court has stated that no judicial declaration of heirship is

necessary in order that an heir may assert his or her right to the property
of the deceased.

The Court of Appeals' reliance on the ruling in Heirs of Yaptinchay v.Del

Rosario was misplaced. In that case, the motion to dismiss was filed
immediately after the second Amended Complaint was filed. The trial
court granted the motion to dismiss, holding that the Heirs of Yaptinchay
"have not shown any proof or even a semblance of it - except the
allegations that they are the legal heirs of the above-named Yaptinchays-
that they have been declared the legal heirs of the deceased couple.

Here, respondents never raised their objection to petitioner's capacity to

sue either as an affirmative defense or in a motion to dismiss. Rule 9,
Section 1 of the Rules of Court states, "[ d]efenses and objections not
pleaded either in a motion to dismiss or in the answer are deemed
waived." Thus, it was erroneous for the Court of Appeals to dismiss the
complaint on the ground that there was no prior judicial declaration of
petitioner's heirship to Norberto.

2) Yes, Contrary to the erroneous conclusion of the Court of Appeals, this

Court finds no need for a separate proceeding for a declaration of heirship
in order to resolve petitioner's action for cancellation of titles of the
property.

This case has gone a long way since the complaint was filed in 1997. A
full-blown trial had taken place and judgment was rendered by the
Regional Trial Court where it thoroughly discussed, evaluated, and
weighed all the pieces of documentary evidence and testimonies of the
witnesses of both parties. At this point, to dismiss the case and require

498
petitioner to institute a special proceeding to determine her status as heir
of the late Norberto would hamper, instead of serve, justice.

In Portugal v. Portugal-Beltran, where the contending parties insisted to

be the legal heirs of the decedent, this Court dispensed with the need to
institute a separate special proceeding to determine their heirship since
the parties had voluntarily submitted the issue to the trial court and
already presented their evidence. It held:

It appearing, however, that in the present case the only property of the
intestate estate of Portugal is the Caloocan parcel of land, to still subject it,
under the circumstances of the case, to a special proceeding which could
be long, hence, not expeditious, just to establish the status of petitioners as
heirs is not only impractical; it is burdensome to the estate with the costs
and expenses of an administration proceeding. And it is superfluous in
light of the fact that the parties to the civil case - subject of the present
case, could and had already in fact presented evidence before the trial
court which assumed jurisdiction over the case upon the issues it defined
during pre-trial.

In fine, under the circumstances of the present case, there being no

compelling reason to still subject Portugal's estate to administration
proceedings since a determination of petitioners' status as heirs could be
achieved in the civil case filed by petitioners, the trial court should
proceed to evaluate the evidence presented by the parties during the trial
and render a decision thereon[.] In this case, there is no necessity for a
separate special proceeding and to require it would be superfluous
considering that petitioner had already presented evidence to establish
her filiation and heirship to Norberto, which respondents never disputed.

Petition is GRANTED. The Court of Appeals Decision are VACATED and

SET ASIDE. The Decision of the Regional Trial Court, Cebu City is
REINSTATED.

499
MARLON BACERRA Y TABONES vs. PEOPLE OF THE PHILIPPINES

G.R. No. 204544

July 3, 2017

LEONEN, J.

DOCTRINE:
“The identity of the perpetrator of a crime and a finding of guilt may rest solely
on the strength of circumstantial evidence.”

FACTS:

Alfredo and his family were sound asleep in their home. At about
1:00 a.m., he was roused from sleep by the sound of stones hitting his
house. Alfredo went to the living room and peered through the jalousie
window. The terrace light allowed him to recognize his neighbor and co-
worker, Bacerra.

Bacerra threw stones at Alfredo's house while saying, "Vulva of your

mother." Just as he was about to leave, Bacerra exclaimed, "[V]ulva of
your mother, Old Fred, I'll bum you now." Bacerra then left. Alfredo's son,
Edgar, also witnessed the incident through a window in his room.

Troubled by Bacerra's threat, Alfredo waited for him to return. Alfredo

sat down beside the window. At around 4:00a.m., he heard dogs barking
outside. Alfredo looked out the window and saw Bacerra walking
towards their nipa hut, which was located around 10 meters from their
house.

Bacerra paced in front of the nipa hut and shook it. Moments later,
Alfredo saw the nipa hut burning.

500
Alfredo sought help from his neighbors to smother the fire. Edgar
contacted the authorities for assistance but it was too late. The nipa hut
and its contents were completely destroyed. The local authorities
conducted an investigation on the incident.

Bacerra was charged with violation of Section 1 of Presidential Decree No.

1613. Regional Trial Court found Bacerra guilty beyond reasonable doubt
of arson.

Bacerra appealed and argued that none of the prosecution's witnesses had
positively identified him as the person who burned the nipa hut.

The Court of Appeals affirmed the Decision of the Regional Trial Court.
Bacerra moved for reconsideration but was denied. Bacerra filed a
Petition for Review on Certiorari.

Petitioner argues that the Court of Appeals erred in upholding his

conviction based on circumstantial evidence, which, being merely based
on conjecture, falls short of proving his guilt beyond reasonable doubt.
No direct evidence was presented to prove that petitioner actually set fire
to private complainant's nipa hut.

ISSUE:

Whether or not circumstantial evidence is sufficient to uphold conviction.

RULING:

Yes, in this case, no one saw petitioner actually set fire to the nipa hut.
Nevertheless, the prosecution has established multiple circumstances,
which, after being considered in their entirety, support the conclusion that
petitioner is guilty beyond reasonable doubt of simple arson.

501
First, the evidence was credible and sufficient to prove that petitioner
stoned private complainant's house and threatened to bum him. Private
complainant testified that he saw petitioner throwing stones at his house
and heard petitioner say, "okinam nga Lakay Fred, puuran kayo tad ta!"
(Vulva of your mother, Old Fred, I'll bum you now.) Petitioner's threats
were also heard by private complainant's son and grandchildren.

Second, the evidence was credible and sufficient to prove that petitioner
returned a few hours later and made his way to private complainant's
nipa hut. Private complainant testified that at 4:00 a.m., he saw petitioner
pass by their house and walk towards their nipa hut. This was
corroborated by private complainant's son who testified that he saw
petitioner standing in front of the nipa hut moments before it was burned.

Third, the evidence was also credible and sufficient to prove that
petitioner was in close proximity to the nipa hut before it caught fire.
Private complainant testified that he saw petitioner walk to and from in
front of the nipa hut and shake its posts just before it caught fire. Private
complainant's son likewise saw petitioner standing at the side of the nipa
hut before it was burned.

A number of circumstantial evidence may be so credible to establish a fact

from which it may be inferred, beyond reasonable doubt, that the
elements of a crime exist and that the accused is its perpetrator. There is
no requirement in our jurisdiction that only direct evidence may convict.
After all, evidence is always a matter of reasonable inference from any
fact that may be proven by the prosecution provided the inference is
logical and beyond reasonable doubt.

The crime of simple arson was proven solely through circumstantial

evidence in People v. Abayon. None of the prosecution's witnesses
actually saw the accused start the fire. Nevertheless, the circumstantial
evidence adduced by the prosecution, taken in its entirety, all pointed to
the accused's guilt.

502
Petition for Review is DENIED. The Decision of the Court of Appeals is
AFFIRMED.

503
 CHINATRUST COMMERCIAL BANK VS. PHILIP TURNER

G.R. No. 191458

July 3, 2017

LEONEN, J.:

DOCTRINE:
“Issues that were not alleged or proved before the lower court cannot be decided
for the first time on appeal. This rule ensures fairness in proceedings.”

FACTS:

British national Turner initiated via Chinatrust-Ayala Branch the

telegraphic transfer of US$430.00 to the account of "MIN
TRAVEL/ESMAT AZMY, Citibank, Heliopolis Branch" in Cairo, Egypt.
The amount was partial payment to Turner's travel agent for his and his
wife's 11-day tour in Egypt. Turner paid a service fee of US$30.00. Both
amounts were debited from his dollar savings account with Chinatrust.

Chinatrust received Citibank-Cairo's telexnotice about the latter's inability

to credit the funds it received because the "the beneficiary's name "Min
Travel/Esmat Azmy" given by Turner did not match the account name on
file of Citibank-Cairo.”

Turner allegedly informed Chinatrust that he was able to contact Esmat

Azmy, who acknowledged receipt of the transferred funds. Turner,
however, had to cancel his travel-tour because his wife got ill and
requested from Chinatrust the refund of his money.

According to Chinatrust, it explained to Turner that since the funds were

already remitted to his beneficiary's account, they could no longer be
withdrawn or retrieved without Citibank-Cairo's consent. Turner was,

504
thus, advised to seek the refund of his payment directly from his travel
agency.

Turner allegedly insisted on withdrawing the funds from Chinatrust

explaining that the travel agency would forfeit fifty percent (50%) as
penalty for the cancellation of the booking. Hence, Chinatrust required
Turner to secure, at least, his travel agency's written certification denying
receipt of the funds so that it could act on his request. However, Turner
purportedly failed to submit the required certification despite repeated
reminders.

Chinatrust received Citibank-Cairo's Swift telex reply, which confirmed

receipt of Chinatrust's telegraphic funds transfer and its credit to the bank
account of Min Travel, not "Min Travel/Esmat Azmy" as indicated by the
respondent. This information was relayed to Turner.

Despite this official confirmation, Turner allegedly continued to insist on

his demand for a refund.

Turner filed a Complaint against Chinatrust before the Metropolitan Trial

Court of Makati City, demanding the refund of his telegraphic transfer.

The Metropolitan Trial Court found sufficient evidence to prove that

Chinatrust complied with its contractual obligation to transmit the funds
to Citibank-Cairo and that these funds were actually credited to the
intended beneficiary's account.

Turner filed an appeal. On the substantive matters, Turner argued that

the Metropolitan Trial Court erred in ruling that he had no basis in
claiming a refund from Chinatrust and in not awarding him damages and
attorney's fees.

Regional Trial Court of Makati City rendered a Decision reversing and

setting aside the decision of the Metropolitan Trial Court. While it agreed
with the Metropolitan Trial Court's findings that the funds had been
deposited to the account of the beneficiary, the Regional Trial Court ruled

505
that this was not sufficient basis to absolve Chinatrust of any
responsibility.

Chinatrust filed a motion for reconsideration, but it was denied.

Chinatrust filed a Petition for Review under Rule 42 of the 1997 Rules of
Civil Procedure before the Court of Appeals. The Court of Appeals
dismissed the petition and upheld the decision of the Regional Trial
Court. Chinatrust's subsequent Motion for Reconsideration was likewise
denied.

Hence, this Petition was filed.

Petitioner alleges that the Court of Appeals adjudged petitioner liable for
negligence: (1) when it did not immediately refund the telexed funds to
respondent upon receipt of the discrepancy notice from Citibank-Cairo;
and (2) when it did not immediately relay to Citibank-Cairo respondent's
demand for the cancellation of the transaction.

According to petitioner, this was erroneous because the Court of Appeals

ruled upon matters not alleged in the complaint or raised as an issue and
awarded damages not prayed for in the complaint.

Respondent counters that the issues raised by petitioner are factual, which
are not reviewable by this Court.

ISSUE:

Whether or not issues may raised for the first time on appeal?

RULING:

No, Section 9 of the Revised Rules on Summary Procedure calls for the
submission of witnesses' affidavits together with a party's position paper

506
after the conduct of a preliminary conference: Section 9. Submission of
Affidavits and Position Papers. - Within ten (10) days from receipt of the
order mentioned in the next preceding section, the parties shall submit
the affidavits of their witnesses and other evidence on the factual issues
defined in the order, together with their position papers setting forth the
law and the facts relied upon by them.

The determination of issues at the preliminary conference bars the

consideration of other questions on appeal. This is because under Section
9 above, the parties were required to submit their affidavits and other
evidence on the factual issues as defined in the preliminary conference
order. Thus, either of the parties cannot raise a new factual issue on
appeal, otherwise it would be unfair to the adverse party, who had no
opportunity to present evidence against it.

Basic rules of fair play, justice, and due process require that arguments or
issues not raised in the trial court may not be raised for the first time on
appeal.

In Philippine Ports Authority v. City of Iloilo:

As a rule, a party who deliberately adopts a certain theory upon which

the case is tried and decided by the lower court will not be permitted to
change theory on appeal. Points of law, theories, issues and arguments
not brought to the attention of the lower court need not be, and ordinarily
will not be, considered by a reviewing court, as these cannot be raised for
the first time at such late stage. Basic considerations of due process
underlie this rule. It would be unfair to the adverse party who would
have no opportunity to present further evidence material to the new
theory, which it could have done had it been aware of it at the time of the
hearing before the trial court. To permit petitioner in this case to change
its theory on appeal would thus be unfair to respondent, and offend the
basic rules of fair play, justice and due process.

507
There is more reason for a reviewing court to refrain from resolving motu
proprio an issue that was not even raised by a party. This Court has
previously declared that:

"Courts of justice have no jurisdiction or power to decide a question not in

issue" and that a judgment going outside the issues and purporting to
adjudicate something upon which the parties were not heard is not
merely irregular, but extrajudicial and invalid.

As pointed out earlier, respondent's cause of action was anchored on the

alleged non-remittance of the funds to his travel agency's account or
based on a breach of contract.

Petitioner bank's supposed negligence in the handling of respondent's

concerns was not among respondent's causes of action and was never
raised in the Metropolitan Trial Court. Respondent's cause of action was
based on the theory that the telexed funds transfer did not materialize,
and the relief sought was limited to the refund of his money and damages
as a result of the purported nonremittance of the funds to the correct
beneficiary account.

Petition is GRANTED. The Court of Appeals' Decision is set aside and the
Decision dated of the Metropolitan Trial Court is reinstated.

508
PEOPLE OF THE PHILIPPINES vs. JOSEPH SAN JOSE Y GREGORIO
AND JONATHAN SAN JOSE Y GREGORIO

G.R. NO. 206916

July 3, 2017

LEONEN, J.

DOCTRINE:
“The prosecution has the burden to prove the accused's guilt beyond reasonable
doubt. If it fails to discharge this burden, courts have the duty to render a
judgment of acquittal.”

FACTS:

The San Jose brothers were considered at large despite the warrants
of arrest issued on October 30, 2002. The case against them was
considered archived. Sometime in 2005, they were arrested. Jonathan San
Josey Gregorio and Joseph San Jose y Gregorio pleaded not guilty.Trial on
the merits ensued.

Jilito O. Espino testified that on June 2, 2002, around 6:30 p.m., there was a
baptismal celebration held on a vacant lot beside their residence in
Riverside, Manggahan, Rodriguez, Rizal. His brother Carlito and his
friends were drinking when Jilito saw the San Jose brothers enter the
house. The San Jose brothers then started punching Carlito, who tried to
run to a nearby store. However, his assailants caught up with him.

The prosecution presented Jilito's testimony that Jonathan embraced

Carlito from behind and while punching him, stabbed him on the side of
his body while Joseph stabbed Carlito in the front. Thereafter, the San Jose
brothers ran away. Carlito's friends also ran away out of fear. Jilito ran
after the San Jose brothers for about 100 meters but failed to catch up to

509
them. When he returned to the vacant lot, he was told that Carli to had
already been brought to the hospital, where he was pronounced dead on
arrival.

Jilito likewise attested that this was not the first incident between Carlito
and the San Jose brothers. He recalled that on New Year's Day, the San
Jose brothers used a lead pipe to hit Carlito.

The autopsy revealed that the victim sustained "one fatal injury at the
abdomen, at the right hypochondriac and multiple abrasions at the lower
extremities."13 The examination also showed that "the stab wound located
at the right hypochondriac or in the abdomen caused an injury lacerating
the pericardial sac, the right ventricle of the heart and the lower lobe of
the right lung." Dr. Pierre Paul Carpio (Dr. Carpio), the Chief of Forensic
Autopsy of the Philippine National Police Crime Laboratory, further
testified that it was possible for the assailant to have been at the victim's
back.

He stated that the stab wound at the right hypochondriac (tagiliran) was
fatal and that there were no defense wounds on the victim.

For their defense, Joseph testified that on June 2, 2002, he and his brother
Jonathan were at home eating with a childhood friend, Leo Narito, when
a commotion occurred outside the house. People were shouting and when
he went outside, he saw a person running away. He asked that person
what was going on and was told that someone had been stabbed. Joseph
returned to his house and continued eating. Sometime in 2005, while he
was at work at a hardware store, police officers arrested him for the
killing of a certain Joselito. He denied the charges against him.

Jonathan asserted that he was 16 years old in 2002, having been born on
September 2, 1985. His testimony corroborated that of his brother Joseph.
Sometime in 2005, he was about to go to work when some barangay
tanods came to arrest him for the killing of Carlito.

510
Jocelyn Espino (Jocelyn) also testified on the San Jose brothers' behalf,
claiming that she was Jilito and Carlito's sister. She stated that at the time
of the incident, Carlito was outside the house. Their neighbors later
informed them of the commotion outside their house involving Carlito.
She claimed that Jilito only learned of the incident when he went outside
of their house. When cross-examined, Jocelyn failed to present evidence to
show that she was Jilito and Carlito's sister.

Regional Trial Court of San Mateo, Rizal, rendered a Decision finding the
San Jose brothers guilty as charged.

Joseph and Jonathan appealed to the Court of Appeals, but it affirmed the
trial court's Decision. The Court of Appeals relied heavily on Jilito's
positive identification of the San Jose brothers as the perpetrators of the
crime.

ISSUE:

Whether or not the prosecution proved the accused’s guilt beyond

reasonable doubt

RULING:

No, It is a basic right of the accused under our Constitution to be

presumed innocent until the contrary is proven. Thus, the quantum of
evidence required to overcome this presumption is proof beyond
reasonable doubt. Rule 133, Section 2 of the Rules of Court provides:
Section 2. Proof beyond reasonable doubt. - In a criminal case, the accused
is entitled to an acquittal, unless his guilt is shown beyond reasonable
doubt. Proof beyond reasonable doubt does not mean such a degree of
proof as, excluding possibility of error, produces absolute certainty. Moral

511
certainty only is required, or that degree of proof which produces
conviction in an unprejudiced mind.

The burden of proving the accused's guilt rests with the prosecution. A
guilty verdict relies on the strength of the prosecution's evidence, not on
the weakness of the defense. If the prosecution's evidence produces even
an iota of reasonable doubt, courts would have no choice but to rule for
the accused's acquittal.

Considering that this Court is not a trier of facts, factual findings of the
trial court are usually accorded great respect "because of the opportunity
enjoyed by the [trial court] to observe the demeanor of the witnesses on
the stand and assess their testimony." Nevertheless, this Court is not
precluded from reviewing these findings or even arriving at a different
conclusion "if it is not convinced that [the findings] are conformable to the
evidence of record and to its own impressions of the credibility of the
witnesses." The factual findings of the trial court will not bind this Court
if "significant facts and circumstances were overlooked and disregarded . .
. which if properly considered affect the result of the case."

This is also an appeal under Rule 122, Section 2(c) of the Rules of Court,
where the entire records of the case are thrown open for review. In Ferrer
v. People: It is a well-settled rule that an appeal in a criminal case throws
the whole case wide open for review and that it becomes the duty of the
Court to correct such errors as may be found in the judgment appealed
from, whether they are assigned as errors or not.

In this case, the Trial court and the Court of Appeals placed heavy
reliance on the testimony of the prosecution's lone eyewitness, Jilito
Espino, and his positive identification of the accused-appellants as the
assailants who murdered his brother. Thus, the review of finding of guilt
necessarily involves a re-evaluation of Jilito's testimony.

The trial court and the Court of Appeals likewise failed to note that the
victim's sister was a witness for the defense and the victim's late father

512
signed an affidavit of desistance. in the accused-appellants' favor. It is
consistent with the human experience for the victim's relatives to seek
justice. An unusual detail, such as two (2) immediate family members of
the victim testifying on behalf of the accused-appellants, forces this Court
to take a second hard look at the prosecution's evidence.

The delayed arrests of the accused-appellants likewise cast doubt on their

guilt. The crime occurred on June 2, 2002. Accused-appellant Jonathan
was arrested on April 1, 2005 and accused-appellant Joseph was arrested
on August 3, 2005, or about three (3) years after the crime was committed.

The prosecution has an eyewitness account in the victim's brother Jilito.

The victim's family remained in the same barangay. The accused-
appellants did not live anywhere else but were arrested in the same
barangay they had been residing. It is highly unusual for the victim's
family to have taken three (3) years to have the alleged perpetrators
arrested.

While delay per se may not impair a witness's credibility, doubt arises
when the delay remains unexplained. The delay in this case becomes
significant when pitted against Jilito's Kusang-loob na Salaysay, where he
admits that he merely heard about the incident from other people.

The unexplained delay and the Kusang-loob na Salaysay lead this Court
to the possibility that Jilito's supposedly positive identification of the
accused-appellants as the perpetrators of the crime was a mere
afterthought.

Here, both the victim's father and sister are convinced that accused-
appellants are not guilty of the crime. The prosecution's lone eyewitness
could not even give a clear and categorical narrative of the events. There
were several unusual circumstances during the prosecution of the case
that he has not adequately explained. The prosecution having failed to
discharge its burden to prove guilt beyond reasonable doubt, this Court is
constrained to acquit accused-appellants.

513
514
 People of the Philippines vs. Edgar Allan Corpuz
G.R. No. 208013
July 3, 2017
Leonen, J.

DOCTRINE:
“An intellectually disabled person is not, solely by this reason, ineligible from
testifying in court.1 "He or she can be a witness, depending on his or her ability
to relate what he or she knows."2 If an intellectually disabled victim's testimony
is coherent, it is admissible in court”

FACTS:
Allan was charged with 4 counts of rape. Sometime in November
2002 he had sexual intercourse with AAA,14 yrs old but has a mental age
of 5 year old an IQ of 42. Her interlligence level was equivalent to
moderate mental retardation. Allan denied accusations and averred that
charges were merely fabricated by AAA’s father. On his appeal, Allan
contested that AAA failed to identify place, date and time hence bereft of
credible proof.

ISSUE:
Whether or not mentally retarded person may qualify as a witness.

RULING:
An intellectually disabled person is not, solely by this reason,
ineligible from testifying in court.1 "He or she can be a witness,
depending on his or her ability to relate what he or she knows."2 If an

515
intellectually disabled victim's testimony is coherent, it is admissible in
court.

An intellectually disabled person is not, solely by this reason, ineligible

from testifying in court.1 "He or she can be a witness, depending on his or
her ability to relate what he or she knows."2 If an intellectually disabled
victim's testimony is coherent, it is admissible in court.

An intellectually disabled person is not, solely by this reason, ineligible

from testifying in court.1 "He or she can be a witness, depending on his or
her ability to relate what he or she knows."2 If an intellectually disabled
victim's testimony is coherent, it is admissible in court.

516
 Heirs of Cayetano Cascayan vs. Sps. Oliver and Evelyn Gumallao and
Municipal Engineer of Bangui Ilocos Norte
G.R. No. 211947
July 3, 2017
Leonen, J.

DOCTRINE:
“An action is an attack on a title when the object of the action is to nullify the
title, and thus challenge the judgment or proceeding pursuant to which the title
was decreed. The attack is direct when the object of an action is to annul or set
aside such judgment, or enjoin its enforcement. On the other hand, the attack is
indirect or collateral when, in an action to obtain a different relief, an attack on
the judgment or proceeding is nevertheless made as an incident thereof. A
counterclaim can be considered a direct attack on the title”

FACTS:
Spouses Gumillao built a residential house which the Cascayan
Heirs allegedly encroached. On spouses Gumillao’s counterclaim, they
asserted that Cascayan Heirs obtained their free patent fraudulently. RTC
found inconsistencies on the evidence presented by Cascayan heirs and
that they have applied for free patent without any basis. The court noted
that they were never in possession of the subject lot. Heirs filed a motion
for new trial citing mistake as a ground. They claimed that despite the
agreement for the trial court to consider only the Commissioner’s report
to resolve the case. RTC denied their motion for new trial. On appeal, CA
denied the petition and held that action was in the nature of accion
reinvidicatoria, wherein the plaintiffs claim ownership over a land and
seek recovery of full possession over it. While the original complaint filed
by petitioners was for recovery of possession, respondent may raise
nullity of title as a defense and by way of counterclaim.

517
ISSUE:
Whether or not CA committed an error in cancelling OCT pursuant to
respondent’s counterclaim.

RULING:
RTC and CA concluded that petitioners obtained the free patent
fraudulently based on several findings. That the petitioners were never in
possession of the subject lot and have submitted inconsistent evidence. In
a cited case, it was held that a counterclaim may be considered as a
complaint or independent action and can be considered a direct attack on
the title. The lower court did not commit an error of law in sustaining the
cancellation of their title.

518
 Marvin Cruz and Fracisco Cruz vs. People of the Philippines
G.R. No. 224974
July 3, 2017
Leonen, J.
DOCTRINE:
“The trial court’s failure to comply with the procedural rules constitutes grave
abuse of discretion and may be the subject of a petition for certiorari before the
Court of Appeals.
FACTS:
Cruz was charged with Robbery for unlawfully taking 4 sacks of
scraps of bronze metal and copper pipe. Cruz posted bail. Private
complainant on the said case filed affidavit of desistance which was
granted by RTC of Malabon. Subsequently Cruz filed motion to release
case bond but was denied by RTC. Cruz filed Petition for Certiorari before
CA. CA anchored its dismissal on the ground that Cruz should’ve filed an
appeal instead of Certiorari, it further stated that it could not treat the
petition for certiorari as an appeal since the period for appeal had lapsed
before filing.

ISSUE:
Whether or not CA erred in dismissing petition for certiorari for
being a wrong remedy to question the denial of motion to release cash
bond.

RULING:
The writ of certiorari is not issued to correct every error that may
have been committed by lower courts and tribunals. It is a remedy
specifically to keep lower courts and tribunals within the bounds of their
jurisdiction. In our judicial system, the writ is issued to prevent lower

519
courts and tribunals from committing grave abuse of discretion in excess
of their jurisdiction. Further, the writ requires that there is no appeal or
other plain, speedy, and adequate remedy available to correct the error.
Thus, certiorari may not be issued if the error can be the subject of an
ordinary appeal.
An essential requisite for filing a petition for certiorari is the
allegation that the judicial tribunal acted with grave abuse of discretion
amounting to lack or excess of jurisdiction.27 Grave abuse of discretion
has been defined as a "capricious or whimsical exercise of judgment that
is patent and gross as to amount to an evasion of positive duty or a virtual
refusal to perform a duty enjoined by law."28 In order to determine
whether the Court of Appeals erred in dismissing the Petition for
Certiorari for being the wrong remedy, it is necessary to find out whether
the Regional Trial Court acted with grave abuse of discretion as to
warrant the filing of a petition for certiorari against it.

When a court or tribunal renders a decision tainted with grave abuse of

discretion, the proper remedy is to file a petition for certiorari under Rule
65 of the Rules of Court. Rule 65

Considering that the trial court blatantly disregarded Rule 114, Section 22
of the Rules of Court, petitioners' remedy was the filing of a petition
for certiorari with the proper court.

Rule 114, Section 22 of the Rules of Court states:

Section 22. Cancellation of bail. - Upon application of the bondsmen, with

due notice to the prosecutor, the bail may be cancelled upon surrender of
the accused or proof of his death.

The bail shall be deemed automatically cancelled upon acquittal of the

accused, dismissal of the case, or execution of the judgment of conviction.

In all instances, the cancellation shall be without prejudice to any liability

on the bail.

520
 CE Luzon Geothermal Power Company vs. CIR

G.R. No. 197526

July 3, 2017
Leonen, J.

DOCTRINE:
“The 120-day and 30-day reglementary periods under Section 112(C) of the
National Internal Revenue Code are both mandatory and jurisdictional. Non-
compliance with these periods renders a judicial claim for refund of creditable
input tax premature”

FACTS:
Petitions for review filed concerning prescriptive period in filing judicial
claims for unutilized creditable input tax or input value added tax. The
sale of generated power by generation companies is a zero-rated
transaction. CE Luzon incurred unutilized creditable input tax. Without
waiting for CIR to act on its claim, or after the expiration of 120 days; CE
Luzon instituted before CTA a judicial clam for refund or its first quarter.
Meanwhile CIR denied its claim for refund of creditable input tax for the
second quarter. CTA en banc ruled that CE Luzon failed to observed the
120 day period, hence barred from claiming refund for it being
prematurely filed. CE Luzon contends that prescriptive periods are only
permissive and does not state that a taxpayer is barred from filing for
non-compliance with the 120 day period.

ISSUE:
Whether or not CE Luzon’s judicial claim for refund of input VAT
were filed within the prescriptive period.

521
RULING:
In the present case, only CE Luzon's second quarter claim was filed
on time. Its claims for refund of creditable input tax for the first, third,
and fourth quarters of taxable year 2003 were filed prematurely. It did not
wait for the Commissioner of Internal Revenue to render a decision or for
the 120-day period to lapse before elevating its judicial claim with the
Court of Tax Appeals.

However, despite its non-compliance with Section 112(C) of the National

Internal Revenue Code, CE Luzon's judicial claims are shielded from the
vice of prematurity. It relied on the Bureau of Internal Revenue Ruling
DA-489-03, which expressly states that "a taxpayer-claimant need not wait
for the lapse of the 120-day period before it could seek judicial relief with
the [Court of Tax Appeals] by way of a Petition for Review."

In a Rule 45 Petition, only questions of law may be raised. "This Court is

not a trier of facts." The determination of whether CE Luzon duly
substantiated its claim for refund of creditable input tax for the second
quarter of taxable year 2003 is a factual matter that is generally beyond
the scope of a Petition for Review on Certiorari. Unless a case falls under
any of the exceptions, this Court will not undertake a factual review and
look into the parties' evidence and weigh them anew.

522
 People of the Philippines vs. Abenir Bruscila Baragwa
G.R. No. 210615
July 26, 2017
Leonen, J.
DOCTRINE:
“It is hornbook doctrine that the findings of the trial court on the credibility of
witnesses and their testimonies are entitled to the highest respect. Having seen
and heard the witnesses and observed their behavior and manner of testifying, the
trial court is deemed to have been in a better position to weigh the evidence. The
reason for this is that trial courts have the unique opportunity to observe the
witnesses first hand and note their demeanor, conduct, and attitude under
grilling examination.”

FACTS:
Information filed against Abenir for killing his wife Delia using a
ball hammer that hit her causing fatal injury and directly caused her
death.
On the night of July 12, 2006, Abenir came home at around 7:00 p.m. or
8:00 p.m. Two (2) of his children were asleep and one (1) was watching
the television. While Abenir was preparing things, Delia went outside.
She appeared to be waiting for somebody. After taking a bath, she fixed
her face. When Abenir asked if Delia was going somewhere, she said it
was none of his business. Abenir went to the bathroom for his personal
effects. While inside, he heard people talking outside and looked out
through a crack in the plywood wall. He saw a man and a woman kiss
and identified the woman as Delia, who told the man, "Huwag muna
ngayon, nandiyan pa siya." The man embraced her, and groped her breast
and private parts. Abenir picked up the maso, went outside, and
approached them, who were surprised to see him. Abenir attacked the
man who used Delia as a shield and pushed her toward Abenir, causing
them to stumble on the ground. Delia went inside while Abenir chased

523
the man. After a failed pursuit, he returned to the house where Joanne
hugged him and inquired what happened. Abenir answered that Delia
was having an affair. He noticed that Kristofer was carrying Delia whose
head was bleeding. He instructed his children to take her to the hospital.
He informed Joanne that he would surrender and asked his children to
call the barangay officials and the police. He voluntarily went with the
officers to the police station where he learned that Delia was hit on the
head. He asserted that he planned to attack the man whom he saw was
with his wife but accidentally hit Delia instead.
Abenir on his appeal argued that there was inconsistency between the
testimonies of Joanne and Abegail.

ISSUE:
Whether or not inconsistency in the testimonies of the witness
would affect their credibility.

RULING:
It is hornbook doctrine that the findings of the trial court on the credibility
of witnesses and their testimonies are entitled to the highest respect.
Having seen and heard the witnesses and observed their behavior and
manner of testifying, the trial court is deemed to have been in a better
position to weigh the evidence. The reason for this is that trial courts have
the unique opportunity to observe the witnesses first hand and note their
demeanor, conduct, and attitude under grilling examination. Thus, the
trial court's evaluation shall be binding on the appellate court unless it is
shown that certain facts of substance and value have been plainly
overlooked, misunderstood, or misapplied. There is no reason to deviate
from the rule.
The alleged inconsistency in the testimonies of Joanne and Abigail does
not affect the credibility of either witness.

524
What is important is that the prosecution witness were consistent on the
principal occurrence and the identity of the accused.

525
 Securities and Exchange Commission vs. Price Richardson
Corporation, Consuelo Velarde-Albert
G.R. No. 197032
July 26, 2017
Leonen, J.

DOCTRINE:
“The determination of probable cause for purposes of filing an information is
lodged with the public prosecutor. It is not reviewable by courts unless it is
attended by grave abuse of discretion.

FACTS:
Price Richardson is in the business of providing administrative
services such as bookkeeping, mailing, and billing services. Allegedly
Price Richardson was engaged in boiler room operations where the
company sell non existent stocks to investors. Whenever such activity was
discovered, the company would close and emerge under new company
name. RTC ordered seizure of Price Richardson’s and Capital
International’s office equipment, documents and other items connected
with the alleged violation. SEC alleged that Price Richardson was neither
licensed nor registered to engage in the business of buying and selling
securities within the Philippines. Prosecutor Aristotle Reyes dismissed
SEC complaint for lack of probable cause. SEC failed to show evidence of
alleged unauthorized trading. Prosecutor absolved the incorporators and
directors from any liability. SEC filed for petition for review before the
DOJ which was denied. CA affirmed that there was no grave abuse of
discretion

526
ISSUE:
Whether or not the courts may pass upon the prosecutor’s
determination of probable cause.

RULING:
It has long been established that the determination of probable
cause to charge a person of a crime is an executive function, which
pertains to and lies within the discretion of the public prosecutor and the
justice secretary.
If the public prosecutor finds probable cause to charge a person with a
crime, he or she causes the filing of an information before the court. The
court may not pass upon or interfere with the prosecutor's determination
of the existence of probable cause to file an information regardless of its
correctness. It does not review the determination of probable cause made
by the prosecutor. It does not function as the prosecutor's appellate court.
Thus, it is also the public prosecutor who decides "what constitutes
sufficient evidence to establish probable cause."
However, if the public prosecutor erred in its determination of probable
cause, an appeal can be made before the Department of Justice Secretary.
Simultaneously, the accused may move for the suspension of proceedings
until resolution of the appeal.
The general rule is that the determination of probable cause is an
executive function which courts cannot pass upon. As an exception,
courts may interfere with the prosecutor's determination of probable
cause only when there is grave abuse of discretion.

527
 GOTESCO PROPERTIES, INC., Petitioner,
v.
SOLIDBANK CORPORATION (NOW METROPOLITAN BANK AND
TRUST COMPANY), Respondent.

G.R. No. 209452

July 26, 2017

Leonen, J.

DOCTRINE:
A complaint for annulment of extrajudicial foreclosure proceeding is cognizable
by the Regional Trial Court.

FACTS:

Gotesco obtained a loan from Solidbank which is secured by real

estate mortgage.

When Gotesco defaulted, Solidbank filed a Petition for Extrajudicial

Foreclosure of the mortgaged properties. Subsequently, Gotesco filed a
complaint for the annulment of the extrajudicial foreclosure proceeding
before the RTC on the ground that the posting of notices of the sale was
not “published once a week for at least three consecutive weeks in a
newspaper of general circulation in the municipality or city”.
The RTC dismissed the complaint of Gotesco which the CA
affirmed.

ISSUE:
Is an appeal by certiorari under Rule 45 the proper remedy of Gotesco?

RULING:

528
 Yes. A petition for review on certiorari is proper when it raises
only questions of law.
A question of law exists when the doubt or controversy concerns the
correct application of law or jurisprudence to a certain set of facts, or
when the issue does not call for an examination of the probative value of
the evidence presented, the truth or falsehood of facts being admitted.
Consequently, the Court ruled that the requirement for publication of a
Notice of Sale in an extrajudicial foreclosure is complied with when the
publication is circulated at least in the city where the property is located.

529
 PEOPLE OF THE PHILIPPINES, Petitioner,
v.
MANUEL ESCOBAR, Respondent.

G.R. No. 214300

July 26, 2017

Leonen, J.

DOCTRINE:
Certain provisions of the Rules of Civil Procedure may be applied in criminal
cases e.g. the fact that the order or judgment appealed from is not appealable is a
ground for the dismissal of appeal.

FACTS:
Manuel Escobar was implicated as a co-conspirator in kidnapping
for ransom, the penalty of which is death that is reduced to reclusion
perpetua pursuant to R.A. No. 9346.
Escobar’s first petition for bail was denied by the RTC since during
the bail hearing, the state witness pointed him as the adviser of the
kidnapping group. The denial of bail was affirmed by the CA.
Escobar filed another petition for bail before the RTC alleging that
the state witness failed to explain how he participated in the kidnapping
for ransom through the giving of advice. The RTC denied the petition on
the ground of res judicata which the CA reversed since a petition for bail is
merely interlocutory.

ISSUE:
Was the CA correct in granting the petition for certiorari filed by Escobar?

RULING:
Yes. The Court of Appeals has pointed out that the other alleged co-
conspirators are already out on bail: Rolando, in particular, was granted
bail because the testimony of the state witness against him was weak.
Escobar and Rolando participated in the same way, but Escobar's bail was
denied. Escobar's fundamental rights and liberty are therefore being
unduly deprived.

530
 VELIA J. CRUZ, Petitioner,
v.
SPOUSES MAXIMO AND SUSAN CHRISTENSEN, Respondents.

G.R. No. 205539

October 04, 2017

Leonen, J.

DOCTRINE:
If the petition for certiorari relates to an act or omission of a municipal trial
court, it shall be filed with the Regional Trial Court exercising jurisdiction over
the area as defined by the Supreme Court.

FACTS:
Velia Cruz inherited from her mother the parcel of land which is
being occupied by Sps. Christensen through tolerance.
However, due to failure of the parties to reach a compromise during
the barangay conciliation, Cruz sent a demand letter to vacate and pay
unpaid rentals to the spouses.
After the demand was left unheeded, Cruz filed a complaint for
unlawful detainer before the Metropolitan Trial Court which dismissed
the same for lack of evidence that the demand letter was duly received by
the spouses.

ISSUE:
Can Cruz file a motion for reconsideration before the Metropolitan Trial
Court?

RULING:
No. Under the Rules of Summary Procedure, a motion for reconsideration
of a judgment is a prohibited motion.
Instead, Cruz filed a petition for certiorari before the RTC which
overturned the decision of the Metropolitan Trial Court.

531
 BICOL MEDICAL CENTER, REPRESENTED BY DR. EFREN SJ.
NERVA, AND THE DEPARTMENT OF HEALTH, REPRESENTED BY
HEALTH SECRETARY ENRIQUE T. ONA, Petitioners,
v.

NOE B. BOTOR, CELJUN F. YAP, ISMAEL A. ALBAO, AUGUSTO S.

QUILON, EDGAR F. ESPLANA II, AND JOSEFINA F. ESPLANA,
Respondents.

G.R. No. 214073

October 4, 2017

J. Leonen

DOCTRINE:
The basic purpose of restraining order is to preserve the status quo until the
hearing of the application for preliminary injunction.

FACTS:

Bicol Medical Center (BMC) issued a hospital memorandum

involving the gate closure of Road Lot No. 3 as part of the rerouting of
traffic inside the BMC compound.
The RTC denied the petition of Naga City for the issuance of a writ
of preliminary injunction finding that there was failure to prove a clear
and unmistakable right to the writ prayed for.
Upon petition for certiorari, the CA granted the petition and
emphasized that only a prima facie showing of an applicant's right to the
writ is required in an application for writ of injunctive relief.

ISSUE:
Did the Supreme Court grant the petition for review on certiorari by
BMC?

532
RULING:
Yes. In general, a petition for review on certiorari will lie when the issue
involves only questions of law.
The following requisites must be proven first before a writ of
preliminary injunction, whether mandatory or prohibitory, may be
issued:

(1)The applicant must have a clear and unmistakable right to be

protected, that is a right in esse;
(2)There is a material and substantial invasion of such right;
(3)There is an urgent need for the writ to prevent irreparable injury
to the applicant; and
(4)No other ordinary, speedy, and adequate remedy exists to
prevent the infliction of irreparable injury.

533
 EVY CONSTRUCTION AND DEVELOPMENT CORPORATION,
Petitioner, v.
VALIANT ROLL FORMING SALES CORPORATION, Respondent

G.R. No. 207938

October 11, 2017

Leonen, J.

DOCTRINE:
Injunctive relief could be granted to prevent grave and irreparable damage to a
business entity's goodwill and business reputation. However, in applications for
provisional injunctive writs the applicant must also prove the urgency of the
application.

FACTS:
Evy Construction applied for the issuance of a temporary
restraining order/writ of preliminary injunction to restrain the Register of
Deeds from compelling it to surrender its certificate of title over a parcel
of land.
Evy Construction acquired the parcel of land through the execution of a
notarized Deed of Sale between it and Linda Ang.

However, before Evy Construction could register the Deed of Sale

with the Register of Deeds, a Notice of Levy on Attachment was
annotated at the certificate of title of the subject land in favor of Valiant
Roll. Eventually, a Writ of Execution and Notice of Levy was issued
against the property.
Evy Construction filed the RTC a Complaint for Quieting of Title with
application for temporary restraining order/writ of preliminary injuction.

The RTC denied the application for the issuance of the TRO/writ of
preliminary injunction which the CA affirmed in a petition for certiorari
brought before it.

534
ISSUE:

May Evy Construction file for a motion for reconsideration to an

unfavorable decision of the CA in its petition for certiorari?

RULING:

Yes. A party may file a motion for reconsideration of a judgment or

final resolution within fifteen (15) days from notice thereof, with proof of
service on the adverse party.

535
 PEOPLE OF THE PHILIPPINES VS. BENJAMIN AUSTRIA

G.R. No. 210568

November 08, 2017

J. Leonen

DOCTRINE:
Rape by sexual intercourse is carnal knowledge by a man of a woman under any
of the circumstances enumerated in Article 266-A(1)(a-d). Rape under Article
266-A(1)(d) is also called statutory rape "as it departs from the usual modes of
committing rape." The child victim's consent in statutory rape is immaterial
because the law presumes that her young age makes her incapable of discerning
good from evil.

FACTS:
AAA testified that Austria was her stepfather and testified that she
was regularly raped by him from 1997 to 2003 every time her mother was
not at home.
When her mother left for the market early in the morning, Austria
came inside her room and started touching her private parts. AAA stated
that even if Austria did not threaten her, she no longer resisted because of
her fear of him and the harm he would inflict on her and her mother.
On 2003, AAA told her aunt, Reyes, of Austria’s repeated abuse
from 1997 to 2003. She finally found the courage to reveal her ordeal to
her aunt because she was already grown up and wanted the abuse to
stop.
Austria testified that AAA falsely accused him of rape because she
was instructed by Reyes to do so.
RTC ruled in favor of AAA. CA affirmed the lower court’s decision.

ISSUE:

536
 Whether or not accused-appellant Austria’s guilt for the charges of
rape against him was proven beyond reasonable doubt?

RULING:
Article 266-A, paragraph 1 of the Revised Penal Code, as amended by
Republic Act No. 8353 or the Anti-Rape Law of 1997, provides the
elements for the crime of rape:

Article 266-A. Rape; When and How Committed. — Rape is committed:

1. By a man who shall have carnal knowledge of a woman under any of

the following circumstances:

Through force, threat, or intimidation; when the offended party is

deprived of reason or otherwise unconscious; by means of fraudulent
machination or grave abuse of authority; and when the offended party is
under twelve (12) years of age or is demented, even though none of the
circumstances mentioned above be present.

2. By any person who, under any of the circumstances mentioned in

paragraph 1 hereof, shall commit an act of sexual assault by inserting his
penis into another person's mouth or anal orifice, or any instrument or
object, into the genital or anal orifice of another person.

The defense did not dispute AAA's claim that she was 10 years old at
the time she was first raped in 1997 at their house and at the kaingin. Her
birth certificate was presented into evidence before the trial court and was
not questioned by the defense. Therefore, what only needs to be proven is
whether or not AAA and the accused had sexual intercourse because
"sexual congress with a girl under 12 years old is always rape." Compared
to AAA's candid and categorical testimony, the accused's defense of
denial must fail. Imbo v. People82 emphasized that the self-serving defense
of denial falters against the "positive identification by, and
straightforward narration of the victim."83 This Court has likewise

537
repeatedly held that the lone yet credible testimony of the offended party
is sufficient to establish the guilt of the accused.

538
 ORIENTAL ASSURANCE CORPORATION V. MANUEL ONG

OCT. 11, 2017

G.R. 189524

J. Leonen

DOCTRINE:
An appellate court is clothed with ample authority to review rulings even if they
are not assigned as errors in the appeal in these instances: (a) grounds not
assigned as errors but affecting jurisdiction over the subject matter; (b) matters
not assigned as errors on appeal but are evidently plain or clerical errors within
contemplation of law; (c) matters not assigned as errors on appeal but
consideration of which is necessary in arriving at a just decision and complete
resolution of the case or to serve the interests of justice or to avoid dispensing
piecemeal justice; (d) matters not specifically assigned as errors on appeal but
raised in the trial court and are matters of record having some bearing on the
issue submitted which the parties failed to raise or which the lower court ignored;
(e) matters not assigned as errors on appeal but closely related to an error
assigned; and (f) matters not assigned as errors on appeal but upon which the
determination of a question properly assigned, is dependent.

FACTS:
JEA Steel Industries, Inc. imported from South Korea 72 steel sheets
in coils that were transported to Manila on board M/V Dooyang Glory.
The 72 coils were discharged and stored in Pier 9 in custody of arrestre
contractor, Asian Terminals. 11 of these coils were found to be in
damaged condition, dented or their normal round shape deformed when
delivered to JEA Steel's plant.

JEA claimed with Oriental for the value of 11 damaged coils pursuant to
Marine Insurance Policy.

539
Oriental now filed a complaint. Asian Terminal's further argued that
Oriental's claim was barred for the latter's failure to file a notice of claim
within the 15-day period provided in the Management Contract bet. PH
Ports Authority and Asian Terminals.

Asian Terminals added that it's liability, if any, should not exceed
Php5,000 pursuant to Sec.7 of the Management Contract.

CA dismissed the case saying the claimed has prescribed. RTC failed
discuss who is responsible for the damage coils.

ISSUES:

WON the CA gravely erred in passing upon the issue of prescription even
though it was not assigned error in the appeal.

WON the claim against Asian Terminals Inc is barred by prescription.

RULING:

Petition granted wherein the Asian Terminals is ordered to pay Oriental

Assurance. Even not assigned as error, SC can resolve based on matters
not specifically assigned as errors on appeal but raised in the trial court
and are matters of record having some bearing on the issue submitted
which the parties failed to raise or which the lower court ignored. As well
as the matters not assigned as errors on appeal but closely related to an
error assigned.

540
 PERSONAL COLLECTION DIRECT SELLING, INC. VS. TERESITA
CARANDANG

G.R. NO. 206958

November 8, 2017

J. Leonen

DOCTRINE:
The Court has nonetheless recognized that if the criminal case is dismissed by the
trial court or if there is an acquittal, the appeal on the criminal aspect of the case
must be instituted by the Solicitor General in behalf of the State. The capability of
the private complainant to question such dismissal or acquittal is limited only to
the civil aspect of the case. This rule is reiterated in the Metrobank case cited by
respondent. However, it should be remembered that the order which herein
petitioner seeks to assail is not one dismissing the case or acquitting respondents.
Hence, there is no limitation to the capacity of the private complainant to seek
judicial review of the assailed order.

FACTS:

Carandang was charged with committing estafa with unfaithfulness

and abuse of confidence under Article 315, paragraph 1 (b) of the RPC.
Personal Collection was the private offended party.

Carandang filed her Counter affidavit claiming that her failure to

completely liquidate the cash advances was due to the sudden
termination of her employment by Personal Collection. She also claimed
that she did not receive any demand letter or any offer from Personal
Collection to settle the case. Personal Collection, through its
representative Marilou S. Palarca, filed its Reply Affidavit, pointing out

541
that Carandang admitted to receiving the cash advances and failing to
liquidate the proceeds. It also argued that it had demanded Carandang to
return the cash advances or liquidate their proceeds and that prior
demand was unnecessary since she admitted that he had received these
cash advances. Personal Collection also filed its Compliance, claiming that
the cash advances to Carandang were not in the form of a contract of
simple loan.

Regional Trial Court issued an Order granting the Motion to Withdraw

Information. It found that Carandang used the cash advances to pay for
the operational expenses of Personal Collection Iloilo City branch and that
her unceremonious termination from employment prevented her from
fully liquidating these cash advances, Thus, Carandang was able to
explain her failure to account for the cash advances she had received in
trust.

Personal Collection filed a petition for certiorari with CA and this was
dismissed for lack of merit.

ISSUE:

Whether or not the Court of Appeals correctly ruled that the Petition
for Certiorari was improper, since it is only the State which may pray for
the reinstatement of the criminal case.

RULING:

This Court notes that the procedural vehicle invoked by petitioner was
inappropriate. In its Petition for Certiorari before the Court of Appeals,
petitioner claims that it resorted to a special civil action for certiorari as it
had "no recourse to an appeal or any other plain, speedy, and adequate
remedy in the ordinary course of law"61 against the trial court's orders to

542
withdraw the Information and release respondent's bail bond.

Petitioner is incorrect. Appeal was available and was the proper

remedy. Rule 122, Section 1 of the Rules of Court states:

Section 1. Who may appeal. - Any party may appeal from a judgment or
final order, unless the accused will be placed in double jeopardy.An order
granting a motion to withdraw an information and dismissing a criminal
case is final, and the remedy to question this final order is an appeal.

In its Petition for Certiorari, petitioner assails the Regional Trial Court's
findings of lack of probable cause due to the alleged insufficiency of
evidence presented by respondent and because all the elements of estafa
were present.68 Thus, petitioner questions the trial court's allegedly
erroneous conclusions of fact and law, which are errors of judgment that
cannot be corrected by an extraordinary writ of certiorari.

543
 DEMEX RATTANCRAFT, INC. AND DELA MERCED VS. LERON

G.R. No. 204288

November 8, 2017

J. Leonen

DOCTRINE:

Only questions of law may be raised in a petition for review brought under Rule
45 of the Rules of Court. This Court, not being a trier of facts, would no longer
disturb the lower court's factual findings when supported by substantial
evidence.

FACTS:

Leron was hired as a weaver by Demex Rattancraft , Inc . ( Demex ) , a

domestic corporation engaged in manufacturing handcrafted rattan
products for local sale and export . Narciso T. Dela Merced was Demex's
president. Leron was paid on a piece-rate basis and his services were
contracted through job* orders. Leron received his wages at the end of
every week but he never received standard benefits such as 13th month
pay , Service incentive leave , rest* day pay , holiday pay, and overtime
pay . Sometime in June 2006, Leron was dismissed by Demex's foreman,
Marcelo Viray (Viray ), and Demex's personnel manager , Nora Francisco
( Francisco). Both accused him of instigating a campaign to remove Viray
as the company's foreman. Before Leron was dismissed from service , he
was given a memorandum stating that the dining chair he had previously
weaved for export to Japan was rejected . For this reason, Demex
expressed that it would no* longer avail of his services. Leron filed a
complaint against Demex for illegal dismissal before the Labor Arbiter
(LA).

544
 LA dismissed the complaint holding that Leron’s termination from
employment was valid. NLRC declared that Leron's absence was a valid
ground to terminate him from employment.

ISSUE:

Whether or not respondent Rosalio A. Leron was validly dismissed

from employment by petitioners Demex Rattancraft, Inc. and Narciso T.
Dela Merced on the ground of abandonment of work?

RULING:

Only questions of law may be raised in a petition for review brought

under Rule 45 of the Rules of Court.43 This Court, not being a trier of
facts, would no longer disturb the lower court's factual findings when
supported by substantial evidence.

The determination of whether or not an employee is guilty of

abandonment is a factual matter. It involves a review on the probative
value of the evidence presented by each party and the correctness of the
lower courts' assessments. The Court of Appeals' finding that respondent
did not abandon his work would generally be binding upon the parties
and this Court.46 However, an exception should be made in this case
considering that there is a variance in the findings of the Court of Appeals
and the National Labor Relations Commission.

Abandonment of work has been construed as "a clear and deliberate

intent to discontinue one's employment without any intention of
returning back."49 To justify the dismissal of an employee on this ground,
two (2) elements must concur, namely: "(a) the failure to report for work
or absence without valid or justifiable reason; and, (b) a clear intention to
sever the employer-employee relationship." Mere failure to report to work
is insufficient to support a charge of abandonment. The employer must
adduce clear evidence of the employee's "deliberate, unjustified refusal to

545
resume his or her employment," which is manifested through the
employee's overt acts.

Set against these parameters, this Court finds that the Court of Appeals
did not err in holding that the National Labor Relations Commission
gravely abused its discretion in upholding respondent's dismissal from
service.

546
 PEOPLE OF THE PHILIPPINES V. FLORIANO TAYABAN

G.R. No. 207666

November 22, 2017

J. Leonen

DOCTRINE:

A person with a chronological age of 7 years and a normal mental age is as

capable of making decisions and giving consent as a person with a chronological
age of 35 and a mental age of 7. Both are considered incapable of giving rational
consent because both are not yet considered to have reached the level of maturity
that gives them the capability to make rational decisions, especially on matters
involving sexuality. Decision-making is a function of the mind. Hence, a person's
capacity to decide whether to give consent or to express resistance to an adult
activity is determined not by his or her chronological age but by his or her mental
age. Therefore, in determining whether a person is ''twelve (12) years of age"
under Article 266-A (1) (d), the interpretation should be in accordance with
either the chronological age of the child if he or she is not suffering from
intellectual disability, or the mental age if intellectual disability is established.

FACTS:

AAA had been previously assessed to have moderate mental

retardation, an intellectual disability. Sometime in May 2008, AAA went
to the house of her uncle, accused-appellant Tayaban, at Rock Quarry,
Poblacion North, Lagawe, Ifugao. While she was there, accused-appellant
undressed her and removed his pants. He then inserted his penis in her
vagina many times and bit her breast. Around three (3) months later10,
Dr. Mae Codamon-Diaz (Dr. Diaz) physically examined AAA and found
a healed laceration on her hymen, which she said could have occurred
more than two (2) weeks earlier.

547
 Regional Trial Court found accused-appellant guilty beyond
reasonable doubt of the crime of rape. It noted that although it was
proven that accused-appellant was AAA's uncle, this aggravating
circumstance was not alleged in the Information and could not be
considered. Similarly, it could not consider the minority of the victim, as
her age was not properly established during trial.15 The Regional Trial
Court found AAA's testimony credible. Court of Appeals affirmed the
findings of the Regional Trial Court but modified the penalty.

ISSUE:

Whether or not Tayaban is guilty of the crime charged?

RULING:

Yes, the accused is guilty of the crime charged. ter carefully

considering the parties' arguments and the records of this case, this Court
resolves to dismiss accused-appellant's appeal for failing to show
reversible error in the assailed decision warranting this Court's appellate
jurisdiction.

Article 266-A of the Revised Penal Code provides, in part:

Article 266-A. Rape; When And How Committed. — Rape is Committed:

1) By a man who shall have carnal knowledge of a woman under any

of the following circumstances:

a) Through force, threat, or intimidation;

b) When the offended party is deprived of reason or otherwise

unconscious;

c) By means of fraudulent machination or grave abuse of authority; and

548
d) When the offended party is under twelve (12) years of age or is
demented, even though none of the circumstances mentioned above be
present.

To sustain a conviction under Article 266-A(1) of the Revised Penal

Code, it must be shown that a man had carnal knowledge of a woman,
and that said carnal knowledge was under any of the following
circumstances:

a) Through force, threat or intimidation;

b) The victim is deprived of reason;

c) The victim is unconscious;

d) By means of fraudulent machination;

e) By means of grave abuse of authority;

f) When the victim is under 12 years of age; or

g) When the victim is demented.27

In relation to the requirement that the victim should be under 12 years

of age, it is the victim's mental age that is determinative of her capacity to
give consent.

The prosecution was able to prove carnal knowledge, AAA testified

that accused-appellant inserted his penis into her vagina repeatedly. Dr.
Diaz's testimony corroborated that there had been carnal knowledge of
AAA. The prosecution also proved that due to her intellectual disability,
AAA's mental age was equivalent to someone under 12 years old. AAA's
intellectual disability was established by the testimony of her teacher and
was found by the Regional Trial Court, which itself was able to examine
her demeanor.

549
 MACARIO S. PADILLA vs. AIRBORNE SECURITY SERVICE, INC.
and/or CATALINA SOLIS
G.R. No. 210080

November 22, 2017

Leonen, J.

DOCTRINE:

“Rule 45 petitions, such as the one brought by petitioner, may only raise
questions of law.”

FACTS:

On September 1, 1986, Padilla was hired by respondent Airborne

Security Service, Inc. (Airborne) as a security guard. He was first assigned
at an outlet of Trebel Piano along Ortigas Avenue Extension, Pasig City.
Padilla allegedly rendered continuous service until June 15, 2009, when he
was relieved from his post at City Advertising Ventures Corporation and
was advised to wait for his reassignment order. On July 27, 2009, he
allegedly received a letter from Airborne
directing him to report for assignment and deployment. He called
Airborne’s office but was told that he had no assignment yet. On
September 9, 2009, he received another letter from Airborne asking him to
report to its office. He sent his reply letter on September 22, 2009 and
personally reported to the office to inquire on the status of his
deployment with a person identified as Mr. Dagang, Airborne’s Director
for operations. He was told that Airborne was having a hard time finding
an
assignment for him since he was already over 38 years old. Padilla added
that he was advised by Airborne’s personnel to resign, but he refused. In
December 2009, when he reported to the office tocollect his 13th month
pay, he was again persuaded to hand in his resignation letter. Still not

550
having been deployed or reassigned, on February 23, 2010, Padilla filed
his Complaint for illegal dismissal, impleading Airborne and its
president, respondent Catalina Solis (Solis).

Respondents countered that Padilla was relieved from his post on account
of a client’s request. Thereafter, Padilla was directed to report to
Airborne’s office in accordance with a Disposition/Relieve Order dated
June 15, 2009. However, he failed to comply and went n absence without
leave instead. Respondents added that more letters — dated July 27, 2009;
September 9, 2009, which both directed Padilla to submit a written
explanation of his alleged unauthorized absences; January 12, 2010; and
May 27, 2010 — instructed Padilla to report to Airborne’s office, to no
avail. Respondents further denied receiving Padilla’s September 22, 2009
letter of explanation.

In his September 10, 2010 Decision, Labor Arbiter Panganiban dismissed

Padilla’s Complaint. He lent credence to respondents’ claim that Padilla
failed to report for work despite the letters sent to him. In its August 3,
2011 Decision, the National Labor Relations Commission affirmed in toto
Labor Arbiter Panganiban’s Decision. The assailed Court of Appeals April
18, 2013 Decision sustained the rulings of the National Labor Relations
Commission and of Labor Arbiter Panganiban. Following the Court of
Appeals’ denial of his Motion for Reconsideration Padilla filed the present
Petition before this Court.

ISSUE:

Whether Petitioner Padilla’s constructive dismissal from his employment

is a question of law and therefore may be subject for petition under Rule
45.

551
RULING:

Yes. Rule 45 petitions, such as the one brought by petitioner, may only
raise questions of law. Equally settled however, is that this rule admits of
the following exceptions:

(1) when the findings are grounded entirely on speculation, surmises or

conjectures;
(2) when the inference made is manifestly mistaken, absurd or impossible;
(3) when there is grave abuse of discretion;
(4) when the judgment is based on a misapprehension of facts;
(5) when the findings of facts are conflicting;
(6) when in making its findings the [Court of Appeals] went beyond the
issues of the case, or
its findings are contrary to the admissions of both the appellant and the
appellee;
(7) when the findings are contrary to the trial court;
(8) when the findings are conclusions without citation of specific evidence
on which they are based;
(9) when the facts set forth in the petition, as well as in the petitioner’s
main and reply briefs, are not disputed by the respondent;
(10) when the findings of fact are premised on the supposed absence of
evidence and contradicted by the evidence on record; and
(11) when the [Court of Appeals] manifestly overlooked certain relevant
facts not disputed by the parties, which, if properly considered, would
justify a different conclusion.

The Court of Appeals made a gross misapprehension of facts and

overlooked other material details. The facts of this case, when more
appropriately considered, sustain a conclusion different from that of the
Court of Appeals. Petitioner was constructively dismissed from
employment owing to his inordinately long floating status.

552
DR. JOSEPH L. MALIXI, DR. EMELITA Q. FIRMACION, MARIETTA
MENDOZA, AURORA AGUSTIN, NORA AGUILAR, MA. THERESA
M. BEFETEL, and
MYRNA NISAY vs. DR. GLORY V. BALTAZAR
G.R. No. 208224

November 22, 2017

LEONEN, J.

DOCTRINE:

“Procedural rules are essential in the administration of justice. The importance of

procedural rules in the adjudication of disputes has been reiterated in numerous
cases. In Santos v. Court of Appeals, et al., 198 SCRA 806 (1991): Procedural
rules are not to be disdained as mere technicalities that may be ignored at will to
suit the convenience of a party. Adjective law is important in insuring the
effective enforcement of substantive rights through the orderly and speedy
administration of justice. These rules are not intended to hamper litigants or
complicate litigation but, indeed, to provide for a system under which suitors
may be heard in the correct form and manner and at the prescribed time in a
peaceful confrontation before a judge whose authority they acknowledge. The
other alternative is the settlement of their conflict through the barrel of a gun.”

FACTS:

Petitioners were employees of Bataan General Hospital holding the

following positions: Dr. Malixi was the Vice President of the Samahan ng
Manggagawa ng Bataan General Hospital, Dr. Firmacion was a Medical
Specialist II, Mendoza and Agustin were both Nurse III, Aguilar and
Befetel were both Nurse II, and Nisay was a Nursing Attendant II.
Meanwhile, Dr. Baltazar was the Officer-in-Charge Chief of Bataan
General Hospital. Petitioners alleged that sometime in May 2008, the
Department of Health (DOH) and the Province of Bataan entered into a

553
Memorandum of Agreement regarding the construction of Bataan
General Hospital’s three (3)-storey building. While this Memorandum
was in effect, the DOH, through then Secretary Francisco T. Duque
(Duque), issued Department Personnel Order No. 2008-1452, appointing
Dr. Baltazar as the hospital’s Officerin-Charge.

According to petitioners, the DOH and the Province of Bataan entered

into a Supplemental Memorandum. One (1) of the provisions stated that
the parties agreed to give the supervision of the hospital to the Secretary
of Health or “his duly authorized representative with a minimum rank of
Assistant Secretary.” A third Memorandum of Agreement was executed
by the parties on June 16, 2009, but the DOH refused to renew the
agreement “due to a complaint already filed before the Honorable
Congresswoman Herminia Roman, and before the DOH.” In their
Complaint, petitioners questioned the validity of Dr. Baltazar’s
appointment and qualifications. They alleged that her
appointment was “without any basis, experience, or expertise.” They
claimed that she was appointed only by virtue of an endorsement of the
Bataan Governor and without the prescribed Career Service Executive
Board qualifications. Petitioners pointed out that Dr. Baltazar’s
appointment was by virtue of a secondment pursuant to the
Memorandum of Agreement. Her third year as Officer-in-Charge via
secondment already violated the law for failing to comply with the
required qualification standards. Granting that there was compliance,
secondment that exceeds one (1) year is subject to the Civil Service
Commission (CSC)’s approval under Section 9(a), Rule VII of the
Omnibus Rules Implementing Book V of Executive Order No. 292 and
DOH Administrative Order No. 46, Series of 2001. CSC Memorandum
Circular No. 15, Series of 1999 likewise provides that the contract of
secondment should be submitted to the Commission within 30 days from
its execution. A year after Dr. Baltazar’s secondment, the Commission did
not issue any authority for her to continue to hold office as Officer-in-

554
Charge of the hospital. Hence, her assumption without the required
authority was deemed illegal.

Petitioners averred that the nonrenewal of the Memorandum of

Agreement by the DOH rendered her appointment ineffective. Her
holding of the position after this nonrenewal was already illegal. In
addition to Dr. Baltazar’s alleged invalid appointment and lack of
qualifications, petitioners contended that she committed several abusive
and malevolent acts detrimental to Bataan General Hospital’s officers and
employees. She authorized the collection of fees for the insertion and
removal of intravenous fluids and fees for the Nurse Station without any
legal basis. She also caused the removal from payroll of an employee,
who, up to the filing of the Complaint, had yet to receive remuneration,
hazard pay, subsistence, and other allowances. Petitioners likewise
alleged that Dr. Baltazar manipulated the creation of the Selection and
Promotion Board to give her control over the personnel’s employment
and promotion. She also disregarded the next-in-line rule when it comes
to appointment and promotion of employees.

Furthermore, Dr. Baltazar allegedly employed two (2) doctors as

contractual employees who were paid P20,000.00 but worked only half
the time rendered by an employee-doctor of Bataan General Hospital.
Lastly, petitioners claimed that Dr. Baltazar allowed her doctor siblings to
accommodate private patients while expressly prohibiting other doctors
to do the same. On October 17, 2011, the CSC rendered a Decision
dismissing the Complaint on the ground of forum shopping. The CSC
found that all elements of forum shopping were present in the case and
that petitioners’ letter dated September 7, 2010 filed with the DOH
contained the same allegations against Dr. Baltazar and sought for the
same relief. Finally, the judgment by the DOH would result to res judicata
in the case before the CSC. It also noted that another case was pending
before the Office of the Ombudsman in relation to the alleged removal of

555
an employee in the hospital’s payroll.
Nevertheless, the CSC resolved the issue of Dr. Baltazar’s appointment
for clarificatory purposes. It held that Dr. Baltazar was not appointed as
Officer-in-Charge of Bataan General

Hospital but was merely seconded to the position. The CSC added that
the approval requirement for secondments that exceed one (1) year was
already amended by CSC Circular No. 06-1165. The new circular merely
required that the Memorandum of Agreement or the secondment contract
be submitted to the Commission for records purposes. Failure to submit
within 30 days from the execution of the agreement or contract will only
make the secondment in effect 30 days before the submission date. On the
alleged violation of the next-in-line rule, the CSC held that employees
holding positions next-in-rank to the vacated position do not enjoy any
vested right thereto for purposes of promotion. Seniority will only be
considered if the candidates possess the same qualifications.

Petitioners moved for reconsideration and argued that the letter before
the DOH was simply a request to meet the Secretary, and not a
Complaint. Furthermore, the letter before the DOH and the Complaint
before the CSC did not contain the same parties or seek the same relief.
The CSC promulgated a Resolution denying the Motion for
Reconsideration. It held that it was the DOH that considered petitioners’
letter as their complaint, and not the CSC. Moreover, the DOH already
exercised jurisdiction over the case when it required Dr. Baltazar to
comment on the lettercomplaint. They elevated the case before the Court
of Appeals, which subsequently issued a Minute Resolution, dismissing
the appeal. Petitioners moved for reconsideration, which was denied by
the Court of Appeals in its July 16, 2013 Minute Resolution. They then
filed a Petition for Review against Dr. Baltazar before this Court. They
pray for the reversal of the Decision and Resolution of the Court of

556
Appeals and of the Decision and Resolution of the CSC. And maintain
that they indicated the important dates in their appeal before the Court of
Appeals and that they attached certified true copies of the assailed
Decision and Resolution. However, they admit that they failed to indicate
the date of their counsel’s Mandatory Continuing Legal Education
(MCLE) compliance and to provide proof of “competent evidence of
identities.” They also deny that they committed forum shopping. The
alleged Complaint sent to the DOH was a mere letter stating the
employees’ grievances and objections to the illegalities and violations
committed by respondent. It was a mere request for the DOH Secretary to
tackle the issues and investigate the concerns in the hospital’s
management. This letter was not intended to serve as a formal Complaint.
They request that this Court set aside the issue on forum shopping and
that the case be resolved on its merits. Respondent filed her Comment
and prayed for the dismissal of the petition. She argues that the
procedural infirmities of petitioners’ appeal are fatal to their case. While,
the petitioners filed their Reply which they reiterated their request for the
relaxation of procedural rules and the
resolution of the case based on its merits. They also disclosed that CSC
Chairman Duque, who signed the October 17, 2011 Decision, was
formerly the DOH Secretary who seconded respondent as Bataan General
Hospital’s Officer-in-Charge. Lastly, petitioners added that their letter to
the DOH was not a Complaint since it was not assigned a case number.

ISSUE:

1. Whether or not the CA erred in dismissing the petition based on

procedural grounds.
2. Whether forum shopping was committed by the petitioner.

RULING:

557
1. Yes. Due to compelling circumstances in this case, this Court opts for a
liberal application of procedural rules. And in in the interest of judicial
economy, the Court of Appeals should avoid dismissal of cases based
merely on technical grounds. Judicial economy requires the prosecution
of cases with the least cost to the parties and to the courts’ time, effort,
and resources.

2. Yes. However, it was committed in the concept of res judicata, is

applicable to judgments or decisions of administrative agencies
performing judicial or quasi-judicial functions. To determine whether a
party violated the rule against forum shopping, the most important factor
to ask is whether the clement of litis pendentia is present, or whether a
final judgment in one case will amount to res judicata in another.
Otherwise stated, the test for determining forum shopping is whether in
the two (or more) cases pending, there is identity of parties, rights or
causes of action, and reliefs sought. If a situation of litis pendentia or res
judicata arises by virtue of a party’s commencement of a judicial remedy
identical to one which already exists (either pending or already resolved),
then a forum shopping infraction is committed.

558
 SIMEON TRINIDAD PIEDAD (deceased), survived and assumed by
his heirs, namely: ELISEO PIEDAD (deceased),** JOEL PIEDAD,
PUBLIO PIEDAD, JR., GLORIA PIEDAD, LOT PIEDAD, ABEL
PIEDAD, ALI PIEDAD, and LEE PIEDAD vs. CANDELARIA
LINEHAN BOBILLES and
MARIANO BOBILLES
G.R. No. 208614

November 27, 2017

LEONEN, J.

DOCTRINE:

“Rule 3, Section 16 of the Rules of Civil Procedure provides for the process of
substitution of parties when the original party to a pending action dies and death
does not extinguish the claim. The prevailing party may move for the execution of
a final and executory judgment as a matter of right within five (5) years from the
entry of judgment. If no motion is filed within this period, the judgment is
converted to a mere right of action and can only be enforced by instituting a
complaint for the revival of judgment in a regular court within ten (10) years
from finality of judgment.”

FACTS:

Sometime in 1974, Simeon Piedad (Piedad) filed a case for

annulment of an absolute deed of sale against Candelaria Linehan
Bobilles (Candelaria) and Mariano Bobilles (Mariano). The case was
docketed as Civil Case No. 435-T and raffled to Branch 9, Regional Trial
Court, Cebu City, presided over by Judge Benigno Gaviola (Judge
Gaviola). On March 19, 1992, the trial court ruled in Piedad’s favor and
declared the deed of sale as null and void for being a forgery. Candelaria
and Mariano appealed the trial court’s Decision, but on September 15,
1998, the Court of Appeals dismissed the
appeal and affirmed the trial court’s ruling. The Court of Appeals’
Decision became final and executory on November 1, 1998. Judge Gaviola

559
issued an order for the issuance of a writ of demolition and later on,
denied Candelaria’s Motion for Reconsideration. Judge Gaviola then
issued a Writ of Demolition against Candelaria and Mariano and referred
it to Sheriff Antonio A. Bellones (Sheriff Bellones) for its implementation.
That same day, in the same case, Candelaria filed a Petition for the
Probate of the Last Will and Testament of Simeon Piedad. Judge Gaviola
ordered that the petition be heard independently and that it be raffled to
another branch.
Candelaria’s Petition for the Probate of the Last Will and Testament of
Simeon Piedad was eventually docketed and raffled to Branch 59,
Regional Trial Court, Toledo City, presided over by Judge Gaudioso D.
Villarin (Villarin). On May 16, 2002, Candelaria also filed a verified
petition for the issuance of a temporary restraining order and/or
preliminary injunction against Sheriff Bellones to restrain him from
enforcing the writ of demolition. Judge Cesar O. Estrera (Judge Estrera),
Executive Judge of the Regional Trial Court of Toledo City and Presiding
Judge of Branch 29, ordered the raffle of the petition against Sheriff
Bellones. A few days later, after summarily hearing the case, Judge
Estrera issued a restraining order against Sheriff Bellones. Upon
Candelaria’s motion, he consolidated the cases before Branch 59, Regional
Trial Court, Toledo City. On May 27, 2002, again upon Candelaria’s
motion, Judge Villarin of Branch 59 extended the temporary restraining
order against Sheriff Bellones for 17 days.

The following motions were eventually filed before Judge Villarin, but he
never resolved them: (1) a motion to dismiss, as amended; (2) a motion
requesting the issuance of an order lifting the injunction order; and (3) a
joint motion to resolve the motions. On February 28, 2007, the Heirs of
Piedad filed an administrative complaint against Judges Estrera and
Villarin. The administrative complaint charged them with Issuing an
Unlawful Order Against a Co-Equal Court and Unreasonable Delay in
Resolving Motions. On December 16, 2009, this Court found both Judges
Estrera and Villarin administratively liable for gross ignorance of the law,
and Judge Villarin liable for undue delay in rendering an order. Civil
Case No. 435-T before Branch 9, Regional Trial Court, Cebu City was
eventually transferred to Branch 29, Regional Trial Court, Toledo City,
where the Heirs of Piedad likewise filed their Motion Praying that an

560
Order Be Issued to Sheriff Antonio Bellones to Resume the Unfinished
Writ of Execution and/or Writ of Demolition. In his Order dated May 15,
2012, Presiding Judge Ruben F. Altubar (Judge Altubar) of Branch 29,
Regional Trial Court, Toledo City denied the motion. Judge Altubar
opined that since more than 12 years had passed since the Court of
Appeals’ September 15, 1998 Decision became final and executory, the
execution should have been pursued through a petition for revival of
judgment, not a mere motion. Judge Altubar then denied the Motion for
Reconsideration of the Heirs of Piedad. They the appealed the denial of
their motions with a petition under Rule 42 of the Rules of Court.
However, the Court of Appeals dismissed the appeal for being the wrong
remedy and also denied the Heirs of Piedad’s Motion for Reconsideration.
Consequently, petitioners Heirs of Piedad filed a Petition for Review on
Certiorari before this Court, where they adopted the findings of fact in the
administrative case against Judges Estrera and Villarin. As they assert
that the Court of Appeals committed grave abuse of discretion when it
denied their motion for the resumption of the writ of demolition and their
motion for reconsideration. And chide Judge Altubar for being equally
ignorant of the law as Judges Estrera and Villarin.

ISSUE:

1. Whether or not petitioners have duly established their personality to

file the petition as heirs of Simeon Piedad; and
2. Whether or not the motion to revive judgment was timely filed.

RULING:

1. Yes. Rule 3, Section 16 of the Rules of Court provides for the process of
substitution of parties when the original party to a pending action dies
and death does not extinguish the claim. And the petitioners claim to be
Piedad’s children; thus, they assert that they are the real parties-in-

561
interest to the action begun by their father. On the other hand,
respondents claim that petitioners did not properly substitute Piedad
upon his death; hence, they failed to substantiate their personality to
move for the revival of judgment However, Petitioners have been
repeatedly recognized as iedad’s rightful heirs not only by the Court of
Appeals but also by this Court. This Court upheld petitioners’ personality
to sue in Heirs of Simeon Piedad and sees no reason to deny them the
same recognition in the case at bar when the current case is merely an
offshoot of their father’s original complaint for nullity of deed of sale.

2. Yes, Rule 39, Section 6 of the Rules of Civil Procedure provides the two
(2) ways of executing a final and executory judgment where the
prevailing party may move for the execution of a final and executory
judgment as a matter of right within five (5) years from the entry of
judgment. And if no motion is filed within this period, the judgment is
converted to a mere right of action and can only be enforced by instituting
a complaint for the revival of judgment in a regular court within 10 years
from finality of judgment.
However, in the instant case, reckoned from November 1, 1998, the date
when the Decision of the Court of Appeals became final and executory, 12
years and 1 day had already elapsed when the instant motion was filed on
November 2, 2010. There may be instances that execution may still pursue
despite the lapse of ten years from finality of judgment but it should be a
result of a well-justified action for revival of judgment, not a mere motion,
as can be found in the cited Supreme Court’s Decision.

The Regional Trial Court likewise referred to Bausa v. Heirs of Dino to

support its denial of petitioners’ motion, claiming that the case at bar is
very similar with Bausa. However, a careful reading of Bausa shows that
while it contains similarities with the case at bar, the factual circumstances

562
and ruling in Bausa tend to support petitioners’ motion for revival, not its
denial.

563
 VISAYAN ELECTRIC COMPANY, INC. vs EMILIO G. ALFECHE,
GILBERT ALFECHE, EMMANUEL MANUGAS, and M. LHUILLIER
PAWNSHOP AND JEWELRY
G.R. No. 209910

November 29, 2017

Leonen, J.

DOCTRINE:

“Ordinarily, it is not for the Supreme Court (SC) to review factual issues in
petitions such as the present Rule 45 Petition which may only raise questions of
law. This rule, however, admits certain exceptions: (1) when the factual findings
of the Court of Appeals and the trial court are contradictory; (2) when the
findings are grounded entirely on speculation, surmises, or conjectures; (3) when
the inference made by the Court of Appeals from its findings of fact is manifestly
mistaken, absurd, or impossible; (4) when there is grave abuse of discretion in the
appreciation of facts; (5) when the appellate court, in making its findings, goes
beyond the issues of the case, and such findings are contrary to the admissions of
both appellant and appellee; (6) when the judgment of the Court of Appeals is
premised on a misapprehension of facts; (7) when the Court of Appeals fails to
notice certain relevant facts which, if properly considered, will justify a different
conclusion; (8) when the findings of fact are themselves conflicting; (9) when the
findings of fact are conclusions without citation of the specific evidence on which
they are based; and (10) when the findings of fact of the Court of Appeals are
premised on the absence of evidence but such findings are contradicted by the
evidence on record.”

FACTS:

On the night of January 6, 1998, a fire broke out at 11th Street, South
Poblacion, San Fernando, Cebu, which burned down the house and store
of respondent Emilio and his son, respondent Gilbert (the Alfeches), and
the adjacent watch repair shop owned by respondent Manugas. It was
alleged that the cause of the fire was the constant abrasion of VECO’s
electric wire with M. Lhuillier’s signboard. The next day, the Alfeches and

564
Manugas reported the incident to the police and to the Sangguniang
Bayan of San Fernando. Upon Emilio, Gilbert, and Manugas’ request for
site inspection, the Sangguniang Bayan of San Fernando eventually
passed Resolution No. 12 requesting VECO to inspect the area and to
repair faulty wires. The Alfeches and Manugas sent a letter to the
management of VECO asking for financial assistance, which VECO
denied. VECO asserted that the fire was due, not to its fault, but to that of
M. Lhuillier. As their initial claim for financial assistance was not
satisfied, the Alfeches and Manugas filed a Complaint for Damages
against VECO and M. Lhuillier before the Regional Trial Court of Cebu
City. During pretrial, M. Lhuillier admitted that it was the owner of the
signboard at its branch in San Fernando, Cebu. M. Lhuillier and VECO
admitted that a fire destroyed the Alfeches’ and Manugas’ properties on
January 6, 1998. The Alfeches and Manugas presented testimonial,
documentary, and object evidence. They presented as witnesses Emilio,
Manugas, Mignonette Alfeche (Mignonette), and Rodolfo Rabor (Rabor).
Emilio testified that between 9:00 p.m. and 10:00 p.m. of January 6, 1998,
he was awakened as their house was burning. He went out and saw a cut
wire swinging and burning at the top of his roof, about three (3) to four
(4) meters away. The Municipal Engineer of San Fernando, Cebu, Engr.
Lauronal, averred that there was a road-widening project, he then asked
the mayor to seek the relocation of VECO’s posts as these would be
affected by the drainage construction. VECO relocated its posts and
consequently, its wires moved closer to the signage of M. Lhuillier with a
distance of only eight (8) inches between them. He also mentioned that
the old location of VECO posts left a hole in the middle of the drainage.
Melencion, an employee of VECO for 41 years, attested that he knew of
the installation of the electric wires in the area. Engr. Constantino, also a
VECO employee, testified that sometime in the last week of December,
there was a complaint that the voltage in 11th Street, South Poblacion, San
Fernando, Cebu was low. Upon inspection, he noticed that VECO’s wires
near the signage of M. Lhuillier were newly installed. He noted that the
wire used in the area was “a No. 4 aluminum standard, secondary
system.” Respondent M. Lhuiller has a branch in San Fernando,
Pampanga and had installed its signage free from any obstacle. On the
other hand, petitioner Visayan Electric Company is the only electric
distribution company in San Fernando, Pampanga. When the

565
Municipality of San Fernando, Pampanga commenced its road widening
project, the Municipal engineer asked the petitioner to relocate its post as
this will be affected by the said project. Petitioner relocated its post closer
to the signage of M.Lhuiller with a distance of only inches between them.
Because of the constant rubbing of the sagging wires of the petitioner with
M. Lhuiller signage a fire broke out. As a result, the fire destroyed the
properties of respondents Emilio Alfeche, Gilbert Alfeche, Emmanuel
Manugas. When the respondents demands payment of indemnity for
damages, the petitioner refused to pay. It denied its liability, arguing that
the cause of fire was attributable to respondent M.Lhuiller, because by
placing their signage near their pole, it caused abrasion and the fire.

ISSUE:
Whether determining as to VECO’s negligence is the proximate cause of
the fire is a question of law that can be further reviewed by the Supreme
Court.

RULING:

Ordinarily, it is not for this Court to review factual issues in petitions such
as the present Rule 45 Petition which may only raise questions of law.
This rule, however, admits certain exceptions:

(1) when the factual findings of the Court of Appeals and the trial court
are
contradictory;
(2) when the findings are grounded entirely on speculation, surmises, or
conjectures;
(3) when the inference made by the Court of Appeals from its findings of
fact is
manifestly mistaken, absurd, or impossible;
(4) when there is grave abuse of discretion in the appreciation of facts;
(5) when the appellate court, in making its findings, goes beyond the
issues of the case,
and such findings are contrary to the admissions of both appellant and

566
appellee;
(6) when the judgment of the Court of Appeals is premised on a
misapprehension of
facts;
(7) when the Court of Appeals fails to notice certain relevant facts which,
if properly
considered, will justify a different conclusion;
(8) when the findings of fact are themselves conflicting;
(9) when the findings of fact are conclusions without citation of the
specific evidence
on which they are based; and
(10) when the findings of fact of the Court of Appeals are premised on the
absence of
evidence but such findings are contradicted by the evidence on record.

The findings of the Regional Trial Court and of the Court of Appeals
differ in this case. The Regional Trial Court found that “had not
defendant [M.] Lhuillier installed its signage in such a manner that it will
come in contact with the secondary lines of defendant VECO, there could
have been no short-circuit which caused the fire.” On the other hand, the
Court of Appeals found that “one VECO post was affected by the road
widening work. Due to the transfer, the VECO wire already touched the
signboard of M. Lhuillier pawnshop.” In the interest of arriving at a
definite determination of the attendant liabilities, this Court exercises its
power of review. VECO’s position is negated not only by the entire
corpus of evidence but, more basically, by common sense.

To reiterate, the Regional Trial Court and the Court of Appeals are
consistent in holding that proximity, abrasion, and short-circuiting led to
the fire. Common sense dictates that the wires and signage could never
have rubbed against each other, or the wires abraded and short-circuited,
had they not been in close proximity. Common sense also shows that they
could not have been in close proximity had not either the wires or the
signage moved closer to the other. The testimonies of Solon and Camuta
were definite that when M. Lhuillier’s signage was installed in 1995, it

567
was free from any obstacle. No allegation was made, let alone proof
presented, that the signage had been relocated in the interim. In contrast,
a plethora of evidence attests to the relocation of VECO’s posts and wires.

Heeding VECO’s position demands not only this Court’s disregard of the
preponderant evidence against VECO but also this Court’s acceptance of
the absurdity and the impossibility that VECO’s posts and wires must
have moved closer to M. Lhuillier’s signage by some unseen, even
supernatural, force. It was VECO that was negligent. It is apparent that it
transferred its posts and wires without regard for the hazards that the
transfer entailed, particularly with respect to the installations which had
previously been distant from the wires and posts but which had since
come into close proximity. VECO would have this Court sustain a flimsy
excuse for evading liability. Attempting to break the all too apparent
causal connection between its negligence and the injury suffered by the
plaintiffs, it would insist on absurdities that strain common sense and
vainly attempt to discredit even its own witness.

568
 PEOPLE OF THE PHILIPPINES vs EMMA BOFILL PANGAN
G.R. No. 206965

November 29, 2017

Leonen, J.

DOCTRINE:

“It is settled that in proceedings involving violations of the Dangerous Drugs

Act, the testimonies of police officers as prosecution witnesses are given weight
for it is assumed that they have performed their functions in a regular manner.”

FACTS:

On April 11, 2003, the Office of the City Prosecutor of Roxas City
filed an Information against Pangan for violation of Section 11 of Republic
Act No. 9165. That on or about the 10th day of April, 2003, in the City of
Roxas, Philippines, and within the jurisdiction of this Honorable Court,
said accused, did then and there willfully, unlawfully and feloniously
have in her possession and control 14.16 grams of Methamphetamine
Hydrochloride (shabu), a dangerous drug, without being authorized by
law to possess the same. However, the accused pleaded not guilty and the
rial on the merits commenced.

The prosecution presented several witnesses among them is PO1 Carillo,

who
was Intelligence Operative of the Capiz Police Provincial Office in Camp
Teodoro Apil, Roxas City. At around 8:00 a.m. of April 10, 2003, he
conducted a test-buy operation on Pangan at B&T Merchandising on Asis
Street, Roxas City. A police asset had reported that the shop was owned
by Pangan and her live-in partner, Mario Tupaz (Tupaz). He applied for
search warrant and requested for a team to conduct buy-bust operation.
They were able to confiscate drug paraphernalia and were marked
accordingly. The arresting team brought Pangan to the police station. The
confiscated articles were recorded in the police blotter. P/S Insp. Batiles

569
prepared and signed the return of service to be presented to the trial court
which issued the search war rant. The arresting team then brought the
return of service of the search warrant and the seized items to the court.
P/S Insp. Batiles wrote a letter to Judge Fantilanan, requesting to
withdraw the four (4) sachets of suspected shabu for laboratory
examination. The trial court granted the request causing the items to be
forwarded to the Philippine National Police Crime Laboratory, Camp
Delgado, Iloilo City. P/C Insp. Baldevieso issued Chemistry Report No.
D-145, which verified that the seized items tested positive for
methamphetamine hydrochloride or shabu. On the other hand, the
defense’s witnesses were Pangan; her live-in partner, Tupaz; her 17- year-
old nephew, Ronel Compa (Compa); a tricycle driver, Wilson Villareal
(Villareal); and Radio Mindanao Network reporter, Bulana. The defense
have a different version of their narrative, where Pangan only received a
package under the name of Gemma and it is where two police men
approached her. One (1) of them struggled to possess the package while
the other poked a gun at Compa, instructing him to stay still. Pangan
claimed that the package was sealed when it was delivered. She asserted
that she was already inside the vehicle when the search warrant was
shown to her. The Regional Trial Court found guilty beyond reasonable
doubt of possession of 14.16 grams of methamphetamine hydrochloride.
Pangan appealed the conviction, attesting that the prosecution failed to
prove the identity of the confiscated drugs. Allegedly, the police officers
failed to observe the guidelines provided for under Section 21 of Republic
Act No. 9165. Neither the marking of the confiscated drugs or the signing
of the inventory receipt was made in her presence. The Court of Appeals
ruled against the accused and further denied their appeal. Hence, this
appeal was filed before this Court.

ISSUE:

Whether the testimony of Culili can prove her guilt considering that the
delivery man has no personal knowledge of the package’s contents.

570
RULING:
Yes. It is settled that in proceedings involving violations of the Dangerous
Drugs Act, the testimonies of police officers as prosecution witnesses are
given weight for it is assumed that they have performed their functions in
a regular manner. Thus, this presumption stands except in cases when
there is evidence to the contrary or proof imputing ill motive on their
part, which is wanting in this case. Pangan failed to adduce any evidence
which could overturn the well-entrenched presumption in favor of the
police officers.

571
 PEOPLE OF THE PHILIPPINES vs. SEGFRED L. OROZCO, et. Al.
G.R. No. 211053

November 29, 2017

J. Leonen

DOCTRINE:

“The trial court’s factual findings, assessment of the credibility of witnesses and
the probative weight of their testimonies, and conclusions based on these factual
findings are to be given the highest respect.”

FACTS:
That on or about the 15th day of November 1998, in the City of
Surigao, Philippines, and within the jurisdiction of this Honorable Court,
the above named accused, conspiring, confederating together and
mutually helping one another, taking advantage of superior strength and
by means of treachery and armed with pointed weapons, did then and
there willfully, unlawfully and feloniously attack, assault and
stab Julius Joshua Mata with the use of said pointed weapons hitting the
latter on the vital parts of his body, thereby inflicting upon him serious
and mortal wounds which caused the death of said Julius Joshua Mata, to
the damage and prejudice of the heirs of the deceased in such amount as
may be allowed by law. Orozco and Osir were arraigned on January 25,
1999 and pled not guilty, while Castro and Maturan were still at-large.
Trial for Orozco and Osir ensued. On March 9, 2002, Maturan was
arrested and pled not guilty upon arraignment on July 3, 2002. Castro was
arrested on November 23, 2006 and arraigned on December 22, 2006. He
offered to plead guilty to the lesser offense of homicide; but this was
rejected, and a plea of “not guilty” was entered for him. Osir passed away
during the course of trial, and the case against him was dismissed in an
Order dated February 20, 2008. The prosecution had Susan Lalona
testified and was able to provide details on the night of the incident and
Dr. Milagros Regaña also testified that the size and nature of Mata’s

572
wounds could indicate the use of at least two (2) separate weapons.
While, the defense likewise presented another version of the incident.

In its October 7, 2010 Decision, the Regional Trial Court (RTC) found
Maturan, Orozco, and accused-appellant Castro guilty of the crime of
murder. Maturan and Castro appealed to the Court of Appeals (CA). But
the same affirmed the findings of the RTC. Thus, Castro filed a Notice of
Appeal with the CA. In compliance with its Resolution, which gave due
course to accused-appellant Castro’s notice of appeal, the Court of
Appeals elevated the records of the case to this Court.

ISSUE:
Whether Lalona’s testimony is sufficient to establish treachery and
conspiracy on the part of the accused.

RULING:
Yes. The trial court’s factual findings, assessment of the credibility of
witnesses and the probative weight of their testimonies, and conclusions
based on these factual findings are to be given the highest respect. When
these have been affirmed by the Court of Appeals, this Court will
generally not re-examine them. Here, the Court of Appeals and Regional
Trial Court found Lalona’s testimony to be credible, considering that it
was candid, categorical, and straightforward. And the accused-appellant
has failed to present any cogent reason to reverse the factual findings of
the Court of Appeals and of the Regional Trial Court.

573
 People of the Philippines, Petitioner, v. Bienvinido Udang, Sr. Y
Sevilla, Respondent
G.R. No. 210161
January 10, 2018
Leonen, J.

DOCTRINE:

The same trial judge should preside over all the stages of the proceedings,
especially in cases where the conviction or acquittal of the accused mainly relies
on the credibility of the witnesses. The trial judge enjoys the opportunity to
observe, first hand, the aids for an accurate determination" of the credibility of a
witness. However, inevitable circumstances-the judge's death, retirement,
resignation, transfer, or removal from office-may intervene during the pendency
of the case, still all cases and judicial proceedings pending decision or sentence
under the jurisdiction of the old courts shall be continued until their final
decision.

A minor’s testimony is credible not because of the generalization that she was a
child of tender years incapable of fabricating a story of defloration but because of
her categorical narration of her experience and her straightforward explanation of
the facts.

FACTS:
This resolves an appeal from the October 9, 2013 Decision2 of the
Court of Appeals in CA-G.R. CR HC No. 01032 affirming the conviction
of accused-appellant, Bienvinido Udang, Sr. y Sevilla (Udang), for two (2)
counts of rape defined under Article 266-A, paragraph 1 of the Revised

574
Penal Code. Udang was sentenced to suffer the penalty of reclusion
perpetua on both counts and ordered to pay the private complainant civil
indemnity, moral damages, and exemplary damages.

AAA, then 12 years old, drank alcoholic beverages with Udang's children,
her neighbors: Betty Udang and Bienvinido Udang, Jr., at their house in
Lumbia, Cagayan de Oro City. After drinking AAA became intoxicated.
She later realized that she was being carried by Udang into a dark room
and inserted his penis into her vagina. One (1) year and three (3) months
after, AAA, who by then was already 13 years old, same scenario
happened again. She had drinks with Udang, and Bienvinido Udang, Jr.
and when intoxicated, Udang inserted his penis into her vagina.

AAA had herself physically examined by Dr. Revelo and found that
AAA had hymenal lacerations as well as excoriations which could have
been caused by trauma, frictions, infections, and also sexual intercourse.
The defense presented as witnesses Udang and his daughter, Betty.
Monera Gandawali and Emirald Orcales, fellow inmates of AAA at the
Cagayan de Oro City Jail, also testified in Udang's defense.

Betty, denied drinking with AAA and belied the claim that her father,
Udang, and her brother, Bienvinido, Jr., had drinks with AAA. However,
she alleged that AAA once went to their house to invite her to sniff some
rugby, an offer which she refused and maintained that AAA only wanted
to get back at her father for having AAA arrested after she was caught
grappling with Betty's grandmother because the latter tried to stop AAA
from sniffing rugby inside Udang's house. After Udang caused the arrest
of AAA for sniffing rugby, AAA was detained at the Cagayan de Oro City
Jail where she, Gandawali, and Orcales, became fellow inmates.

575
Gandawali testified that during their conversation, AAA disclosed that
she was never actually raped by Udang and that it was actually her
stepfather who wanted to implicate him. Orcales testified that AAA
disclosed to Orcales that it was not Udang but a security guard who had
raped her and that it was AAA's mother who had forced her to testify
against Udang in retaliation for her arrest for sniffing rugby. Also, Udang
denied ever raping AAA.

The Regional Trial Court found for the prosecution and convicted Udang
of rape. and found that the prosecution "indubitably established” Udang's
act of raping AAA since she "categorically narrated" how he took
advantage of her while she was intoxicated and that had she resisted his
advances, she would be mauled by Betty. That AAA was raped was also
supported by Dr. Revelo's finding of hymenal lacerations and excoriations
on AAA's thighs and genitalia.

The trial court did not give credence to Udang's defense of denial and
alibi, stating that he could have requested his family members and fellow
barangay tanods, who were allegedly with him at the time of the
incidents, to corroborate his testimony but that he failed to do so. Without
the corroborating testimony of these alleged companions, his testimony
was, for the trial court, "self-serving and unworthy to be believed." And it
likewise discounted Gandawali's and Orcales' testimonies for being
hearsay. As for Betty, the trial court found her testimony "bare" and
"unsupported by evidence."

Udang appealed before the Court of Appeals. He also claimed that the
judge who penned the Decision, Judge Richard D. Mordeno was not the
judge who personally heard the witnesses testify and was not able to
observe their demeanor during trial. Udang argued that Judge Mordeno,

576
therefore, was not in the position to rule on the credibility of AAA, given
her "unbelievable story” of rape.

Udang emphasized that AAA's testimony was not credible for if she was
allegedly raped in his house in September 2002, she would not have gone
to the same house to have drinks with her supposed rapist a year after, in
December 2003, on the risk of being raped again. He highlighted AAA's ill
motive against him for having caused her detention in the Cagayan de
Oro City Jail for sniffing rugby in his house. Finally, he emphasized that
Dr. Revelo's testimony established that the lacerations found in AAA' s
genitalia could have been caused by trauma other than rape.

In its ruling, the Court of Appeals still found Udang's guilt was proven
beyond reasonable doubt based on the records of the case and AAA's
"categorical, convincing and consistent" testimony. Thus, the Court of
Appeals affirmed the trial court Decision in toto and dismissed Udang's
appeal.

ISSUES:
A. Whether or not AAA, a child of tender years was a credible witness.
B. Whether or not Judge Mordeno, not the judge who heard the parties
and their witnesses during trial was in no position to rule on the
credibility of the witnesses validly rule on the said case.

RULING:

A. The court ruled in the affirmative. All the elements of sexual abuse are
present in this case. As an adult and the father of AAA's friend, Betty,
Udang had influence over AAA, which induced the latter to have drinks
and later on have sexual intercourse with him. AAA, born on May 20,

577
1990, was 12 and 13 years old when the incidents happened. The
transcript of stenographic notes shows AAA's "categorical, convincing
and consistent” testimony as to how Udang sexually abused her in
September 2002. Hence, this Court finds AAA credible not because of the
generalization that she was a child of tender years incapable of fabricating
a story of defloration but because of her categorical narration of her
experience and her straightforward explanation that she was intimidated
by Betty to have drinks with her father. Further, Betty's threat of violence
was enough to induce fear in AAA. AAA's delay in reporting the
incidents did not affect her credibility. Delay is not and should not be an
indication of a fabricated charge because, more often than not, victims of
rape and sexual abuse choose to suffer alone and "bear the ignominy and
pain" of their experience. Here, AAA would not have revealed the
incidents had she not been interviewed by the police when she was
arrested for sniffing rugby.

Furthermore, Udang failed to present evidence sufficient to counter the

prosecution's prima facie case against him. To destroy AAA's credibility,
Udang capitalizes on the fact that he was charged only after he had AAA
arrested for sniffing rugby. However, given AAA's affirmative and
credible testimony, Udang's allegation of ill motive is deemed
inconsequential. While prosecution witness Dr. Revelo testified that the
lacerations found in AAA's genitalia could have been "introduced by
other operation” aside from sexual intercourse, Udang had nothing but
denials and alibis as defenses. If, as Udang testified, he was with his
mother, siblings, and some barangay tanods during the alleged incidents,
he could have presented them as witnesses to corroborate his testimony,
but he did not. Neither is Betty's testimony that Udang never had drinks
with AAA sufficient to acquit her father. Udang's and Betty's testimonies
are “self-serving" and were correctly disregarded by the trial court.

578
The testimonies of Gandawali and Orcales, AAA's fellow inmates at the
Cagayan de Oro City Jail, were hearsay, hence, inadmissible in evidence.
This is because Gandawali and Orcales had no personal knowledge of the
incidents as they were not there when the incidents happened.

B. The court ruled in the affirmative. Ideally, the same trial judge should
preside over all the stages of the proceedings, especially in cases where
the conviction or acquittal of the accused mainly relies on the credibility
of the witnesses. The trial judge enjoys the opportunity to observe, first
hand, "the aids for an accurate determination" of the credibility of a
witness "such as the witness' deportment and manner of testifying, the
witness' furtive glance, blush of conscious shame, hesitation, flippant or
sneering tone, calmness, sigh, or thescant or full realization of an oath. "
However, inevitable circumstances-the judge's death, retirement,
resignation, transfer, or removal from office-may intervene during the
pendency of the case. An example is the present case, where the trial
judge who heard the witnesses, Judge Francisco D. Calingin,
compulsorily retired pending trial. Judge Calingin was then replaced by
Judge Mordeno, who proceeded with hearing the other witnesses and
writing the decision. Udang's argument cannot be accepted as this would
mean that every case where the judge had to be replaced pending
decision would have to be refiled and retried so that the judge who hears
the witnesses testify and the judge who writes the decision would be the
same.62 What Udang proposes is impracticable.

According to Act No. 2347's purpose was "simply to change the personnel
of the judges" and that it specifically provided that all cases and judicial
proceedings pending decision or sentence under the jurisdiction of the old
courts shall be continued until their final decision.

579
Further, this Court explained that with the existence of the transcript of
records, which are presumed to be a "complete, authentic record of
everything that transpires during the trial,” there is "little reason for
asserting that one qualified person may not be able to reach a just and fair
conclusion from [the] record as well as another." Thus, it compelled Judge
Abreu to proceed with deciding the cases where evidence was already
taken by the former presiding judge.

Applying the foregoing, the trial court decision convicting Udang is valid,
regardless of the fact that the judge who heard the witnesses and the
judge who wrote the decision are different. With no showing of any
irregularity in the transcript of records, it is presumed to be a "complete,
authentic record of everything that transpired during the trial," sufficient
for Judge Mordeno to have evaluated the credibility of the witnesses,
specifically, of AAA.

580
CHARLIE HUBILLA, et al., Petitioner v. HSY MARKETING LTD., CO.,
et al., Respondent
G.R. No. 207354
January 10, 2018
LEONEN, J.

DOCTRINE:

With the existence of the transcript of records, which are presumed to be a

"complete, authentic record of everything that transpires during the trial,” there
is "little reason for asserting that one qualified person may not be able to reach a
just and fair conclusion from [the] record as well as another."

All petitions for certiorari are required to be verified upon filing. For a pleading
to be verified, the affiant must attest that he or she has read the pleading and that
the allegations are true and correct based on his or her personal knowledge or on
authentic records. Otherwise, the pleading is treated as an unsigned pleading.

The certification of non-forum shopping must be signed by the litigant, not his or
her counsel. The litigant may, for justifiable reasons, execute a special power of
attorney to authorize his or her counsel to sign on his or her behalf.

Factual findings of labor officials, who are deemed to have acquired expertise in
matters within their jurisdiction, are generally accorded not only respect but even
finality by the courts when supported by substantial evidence. Nonetheless, these
findings are not infallible. When there is a showing that they were arrived at
arbitrarily or in disregard of the evidence on record, they may be examined by the

581
 courts. When the evidence of the employer and the employee are in equipoise,
doubts are resolved in favor of labor.

FACTS:
This is a Petition for Review on Certiorari assailing the February 25,
2013 Decision and May 30, 2013 Resolution of the Court of Appeals in
CA-GR. SP No. 126522, which upheld the Labor Arbiter's finding that the
employees voluntarily terminated their employment. The assailed
judgments also set aside the National Labor Relations Commission's
application of the principle of equipoise on the ground that the employees
failed to present any evidence in their favor.

HSY Marketing Ltd., et. al are engaged in manufacturing and selling

goods under the brand Novo Jeans & Shirt & General Merchandise (Novo
Jeans). Several Novo Jeans employees went to Raffy Tulfo's radio
program to air their grievances against their employers for alleged labor
violations and were referred to the Department of Labor and
Employment. They claimed they were not allowed to enter the Novo
Jeans branches they were employed in and that while Novo Jeans sent
them a show cause letter the next day, they were in truth already
dismissed from employment. They sent a demand letter to amicably settle
the case before the Department of Labor and Employment but no
settlement was reached.

They alleged that upon learning that the Department of Labor and
Employment was not the proper forum to address their grievances, they
decided to file a notice of withdrawal and file their complaint with the
Labor Arbiter. On the other hand, Novo Jeans claimed that these
employees voluntarily severed their employment but that they filed
complaints later with the Department of Labor and Employment. They
alleged that the employees' notice of withdrawal was not actually granted

582
by the Department of Labor and Employment but that the employees
nonetheless filed their complaints before the Labor Arbiter.

Labor Arbiter ruled that other than the employees' bare allegations that
they were dismissed from June 6 to 9, 2010, they did not present any other
evidence showing that their employment was terminated or that they
were prevented from reporting for work and likewise ruled that the
employees voluntarily severed their employment since the airing of their
grievances on Raffy Tulfo's radio program "was enough reason for them
not to report for work, simply because of a possible disciplinary action by
Novo Jeans." Hence, the Labor Arbiter dismissed the consolidated cases
for utter lack of merit and for forum-shopping. The employees appealed
to the National Labor Relations Commission and then rendered that the
employees were illegally dismissed. It ruled that the allegations of both
parties "were unsubstantiated and thus were equipoised" and that "if
doubt exists between the evidence presented by the employer and that by
the employee, the scales of justice must be tilted in favor of the latter.

Novo Jeans moved for partial reconsideration but was denied by the
National Labor Relations Commission. Thus, it filed a Petition for
Certiorari with the Court of Appeals and found that Novo Jeans' counsel,
as the affiant, substantially complied with the verification requirement
even if his personal knowledge was based on facts relayed to him by his
clients and on authentic records since he was not privy to the antecedents
of the case.

The Court of Appeals stated that while the employees merely alleged that
they were no longer allowed to report to work on a particular day, Novo
Jeans was able to present the First Notice of Termination of Employment
sent to them, asking them to explain their sudden absence from work

583
without proper authorization. It likewise found that the Notices of
Termination of Employment (Notices) did not indicate that the employees
were dismissed or that they were prevented from entering the stores.
According to the Court of Appeals, the equipoise rule was inapplicable in
this case since it only applied when the evidence between the parties was
equally balanced. Considering that only Novo Jeans was able to present
proof of its claims, the Court of Appeals was inclined to rule in its favor.
Thus, the Court of Appeals concluded that the case involved voluntary
termination of employment, not illegal dismissal.

ISSUES:
A. Whether or not the Court of Appeals may, in a petition for certiorari,
review and re-assess the factual findings of the National Labor Relations
Commission

B. Whether or not verification based on facts relayed to the affiant by his

clients is valid
C. Whether respondents’ certification of non-forum shopping as being
signed by their counsel is valid

D. Whether or not equipoise rule applies

RULINGS:

A. The court in the affirmative. Factual findings of labor officials

exercising quasi-judicial functions are accorded great respect and even
finality by the courts when the findings are supported by substantial
evidence. Substantial evidence is "the amount of relevant evidence which
a reasonable mind might accept as adequate to support a conclusion. "
Thus, in labor cases, the issues in petitions for certiorari before the Court

584
of Appeals are limited only to whether the National Labor Relations
Commission committed grave abuse of discretion. However, this does not
mean that the Court of Appeals is conclusively bound by the findings of
the National Labor Relations Commission. If the findings are arrived at
arbitrarily, without resort to any substantial evidence, the National Labor
Relations Commission is deemed to have gravely abused its discretion.

The settled rule is that factual findings of labor officials, who are deemed
to have acquired expertise in matters within their jurisdiction, are
generally accorded not only respect but even finality by the courts when
supported by substantial evidence. Nonetheless, these findings are not
infallible. When there is a showing that they were arrived at arbitrarily or
in disregard of the evidence on record, they may be examined by the
courts. The Court of Appeals can then grant a petition for certiorari if it
finds that the National Labor Relations Commission, in its assailed
decision, has made a factual finding that is not supported by substantial
evidence. It is within the jurisdiction of the Court of Appeals, whose
jurisdiction over labor cases has been expanded to review the findings of
the National Labor Relations Commission. The Court of Appeals may also
review factual findings if quasi-judicial agencies' findings are
contradictory to its own findings. Thus, it must re-examine the records to
determine which tribunal's findings were supported by the evidence.

In this instance, the Labor Arbiter and the National Labor Relations
Commission made contradictory factual findings. Thus, it was incumbent
on the Court of Appeals to re-examine their findings to resolve the issues
before it. The Court of Appeals also found that the findings of the
National Labor Relations Commission were not supported by substantial
evidence, and therefore, were rendered in grave abuse of discretion. Thus,
in the determination of whether the National Labor Relations
Commission committed grave abuse of discretion, the Court of Appeals

585
may re-examine facts and re-assess the evidence. However, its findings
may still be subject to review by this Court.

This Court notes that in cases when the Court of Appeals acts as an
appellate court, it is still a trier of facts. Questions of fact may still be
raised by the parties. If the parties raise pure questions of law, they may
directly file with this Court. Moreover, contradictory factual findings
between the National Labor Relations Commission and the Court of
Appeals do not automatically justify this Court's review of the factual
findings. They merely present a prima facie basis to pursue the action
before this Court. The need to review the Court of Appeals' factual
findings must still be pleaded, proved, and substantiated by the party
alleging their inaccuracy. This Court likewise retains its full discretion to
review the factual findings.

B. The court ruled in the negative. All petitions for certiorari are required
to be verified upon filing. The contents of verification are stated under
Rule 7, Section 4 of the Rules of Court:

“Section 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. 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.

586
Thus, for a pleading to be verified, the affiant must attest that he or she
has read the pleading and that the allegations are true and correct based
on his or her personal knowledge or on authentic records. Otherwise, the
pleading is treated as an unsigned pleading. However, verification is
merely a formal, not jurisdictional, requirement. It will not result in the
outright dismissal of the case since courts may simply order the correction
of a defective verification.

A reading of Section 4 of Rule 7 indicates that a pleading may be verified

under either of the two given modes or under both. The veracity of the
allegations in a pleading may be affirmed based on either one's own
personal knowledge or on authentic records, or both, as warranted. The
use of the conjunction "or" connotes that either source qualifies as a
sufficient basis for verification and, needless to state, the concurrence of
both sources is more than sufficient. Bearing both a disjunctive and
conjunctive sense, this parallel legal signification avoids a construction
that will exclude the combination of the alternatives or bar the efficacy of
any one of the alternatives standing alone.

Authentic records may be the basis of verification if a substantial portion

of the allegations in the pleading is based on prior court proceedings.
Here, the annexes that respondents allegedly failed to attach are
employee information, supporting documents, and work-related
documents proving that petitioners were employed by respondents. The
fact of petitioners' employment, however, has not been disputed by
respondents. These documents would not have been the "relevant and
pertinent” documents contemplated by the rules. Petitioners likewise
contend that respondents' Petition for Certiorari before the Court of
Appeals should not have been given due course.

587
To resolve this, this Court must first address whether respondents'
counsel may sign the verification on their behalf. For the guidance of the
bench and bar, the Court restates in capsule form the jurisprudential
pronouncements already reflected above respecting non-compliance with
the requirements on, or submission of defective, verification and
certification against forum shopping:

A distinction must be made between non-compliance with the

requirement on or submission of defective verification, and
noncompliance with the requirement on or submission of defective
certification against forum shopping. As to verification, non-compliance
therewith or a defect therein does not necessarily render the pleading
fatally defective. The court may order its submission or correction or act
on the pleading if the attending circumstances are such that strict
compliance with the Rule may be dispensed with in order that the ends of
justice may be served thereby. Verification is deemed substantially
complied with when one who has ample knowledge to swear to the truth
of the allegations in the complaint or petition signs the verification, and
when matters alleged in the petition have been made in good faith or are
true and correct. As to certification against forum shopping, non-
compliance therewith or a defect therein, unlike in verification, is
generally not curable by its subsequent submission or correction thereof,
unless there is a need to relax the Rule on the ground of "substantial
compliance" or presence of "special circumstances or compelling reasons”.
The certification against forum shopping must be signed by all the
plaintiffs or petitioners in a case; otherwise, those who did not sign will
be dropped as parties to the case. Under reasonable or justifiable
circumstances, however, as when all the plaintiffs or petitioners share a
common interest and invoke a common cause of action or defense, the
signature of only one of them in the certification against forum shopping
substantially complies with the Rule. Finally, the certification against
forum shopping must be executed by the party-pleader, not by his

588
counsel. If, however, for reasonable or justifiable reasons, the party-
pleader is unable to sign, he must execute a Special Power of Attorney
designating his counsel of record to sign on his behalf.

Facts relayed to the counsel by the client would be insufficient for counsel
to swear to the truth of the allegations in a pleading. Otherwise, counsel
would be able to disclaim liability for any misrepresentation by the
simple expediency of stating that he or she was merely relaying facts with
which he or she had no competency to attest to. For this reason, the Rules
of Court require no less than personal knowledge of the facts to
sufficiently verify a pleading.

Respondents' counsel, not having sufficient personal knowledge to attest

to the allegations of the pleading, was not able to validly verify the facts
as stated. Therefore, respondents' Petition for Certiorari before the Court
of Appeals should have been considered as an unsigned pleading.

C. The court ruled in the negative. Respondents’ certification of non-

forum shopping is likewise defective. The certification of non-forum
shopping must be signed by the litigant, not his or her counsel. The
litigant may, for justifiable reasons, execute a special power of attorney to
authorize his or her counsel to sign on his or her behalf. In this instance,
the verification and certification against forum shopping was contained in
one (1) document and was signed by respondents' counsel, Atty. Daclan.
Corporations, not being natural persons, may authorize their lawyers
through a Secretary's Certificate to execute physical acts. Among these
acts is the signing of documents, such as the certification against forum
shopping. A corporation's inability to perform physical acts is considered
as a justifiable reason to allow a person other than the litigant to sign the
certification against forum shopping. By the same reasoning,
partnerships, being artificial entities, may also authorize an agent to sign

589
the certification on their behalf. However, sole proprietorships, unlike
corporations, have no separate legal personality from their proprietors.
They cannot claim the inability to do physical acts as a justifiable
circumstance to authorize their counsel to sign on their behalf. Since there
was no other reason given for authorizing their counsel to sign on their
behalf, respondents Arqueza, Co, and Yeung's certification against forum
shopping is invalid.

While courts may simply order the resubmission of the verification or its
subsequent correction, a defect in the certification of non-forum shopping
is not curable unless there are substantial merits to the case. However,
respondents' Petition for Certiorari before the Court of Appeals was
unmeritorious. Thus, its defective verification and certification of non-
forum shopping should have merited its outright dismissal.

D. The court ruled in the affirmative. When the evidence of the employer
and the employee are in equipoise, doubts are resolved in favor of labor.
In illegal dismissal cases, the burden of proof is on the employer to prove
that the employee was dismissed for a valid cause and that the employee
was afforded due process prior to the dismissal. Respondents allege that
there was no dismissal since they sent petitioners a First Notice of
Termination of Employment, asking them to show cause why they should
not be dismissed for their continued absence from work. However,
petitioners argue that this evidence should not be given weight since
there is no proof that they received this Notice.

Indeed, no evidence has been presented proving that each and every
petitioner received a copy of the First Notice of Termination of
Employment. There are no receiving copies or acknowledgement receipts.
What respondents presented were not the actual Notices that were

590
allegedly sent out. While petitioners admitted that the Notices may have
been sent, they have never actually admitted to receiving any of them.
There is likewise no proof that petitioners abandoned their employment.
Respondents have not presented any proof that petitioners intended to
abandon their employment. They merely alleged that petitioners have
already voluntarily terminated their employment due to their continued
refusal to report for work. However, this is insufficient to prove
abandonment.

Where both parties in a labor case have not presented substantial

evidence to prove their allegations, the evidence is considered to be in
equipoise. In such a case, the scales of justice are tilted in favor of labor.
Thus, petitioners are hereby considered to have been illegally dismissed.

591
 Republic of the Philippines, Petitioner vs. Michelle Soriano Gallo,
Respondent
G.R. No. 207074
January 17, 2018
Leonen, J.

DOCTRINE:

Where there is no dispute as to the facts, the question of whether or not the
conclusions drawn from these facts are correct is a question of law. However, if the
question posed requires a re-evaluation of the credibility of witnesses, or the
existence or relevance of surrounding circumstances and their relationship to each
other, the issue is factual.

A clerical or typographical error pertains to a mistake committed in the

performance of clerical work in writing, copying, transcribing or typing an entry
in the civil register that is harmless and innocuous which is visible to the eyes or
obvious to the understanding, and can be corrected or changed only by reference to
other existing record or records. However, corrections which involve a change in
nationality, age, or status are not considered clerical or typographical.

Under the doctrine of exhaustion of administrative remedies, a party must first

avail of all administrative processes available before seeking the courts'
intervention. However, failure to observe the doctrine of exhaustion of
administrative remedies does not affect the court's jurisdiction. Thus, the doctrine
may be waived. The only effect of noncompliance with this rule is that it will
deprive the complainant of a cause of action, which is a ground for a motion to
dismiss.

592
FACTS:
This is a Petition for Review under Rule 45 assailing the April 29,
2013 Decision of the Court of Appeals in CA-G.R. CV No. 96358, which
denied the Republic of the Philippines' appeal3 from the Regional Trial
Court December 7, 2010 Order4 granting herein respondent Michelle
Soriano Gallo's (Gallo) Petition for Correction of Entry of her Certificate of
Live Birth. Michelle Gallo prayed before the Regional Trial Court of Ilagan
City, Isabela in Special Proceeding for the correction of her name from
"Michael" to "Michelle" and of her biological sex from "Male" to "Female"
under Rule 108 of the Rules of Court and asked for the inclusion of her
middle name, "Soriano"·' her mother's middle name, "Angangan"; her
father's middle name, "Balingao"; and her parent's marriage date, May 23,
1981, in her Certificate of Live Birth, as these were not recorded. As proof,
she attached to her petition copies of her diploma, voter's certification,
official transcript of records, medical certificate, mother's birth certificate,
and parents' marriage certificate.

The Regional Trial Court ordered the publication of the Notice of Hearing
and during trial, Gallo testified on her allegations and showed that her
college diploma, voter's certification, and transcript indicated that her
name was "Michelle Soriano Gallo." The doctor who examined her also
certified that she was female. Gallo explained that she never undertook any
gender-reassignment surgery and that she filed the petition not to evade
any civil or criminal liability, but to obtain a passport. Thus,the Trial Court
granted the petition. It lent credence to the documents Gallo presented and
found that the corrections she sought were "harmless and innocuous.” It
concluded that there was a necessity to correct Gallo's Certificate of Live
Birth and applied Rule 108 of the Rules of Court.

The Office of the Solicitor General appealed, alleging that the applicable
rule should be Rule 103 of the Rules of Court for Petitions for Change of
Name. It argued that Gallo did not comply with the jurisdictional
593
requirements under Rule 103 because the title of her Petition and the
published Order did not state her official name, "Michael Gallo.”.
Furthermore, the published Order was also defective for not stating the
cause of the change of name.

The Court of Appeals denied the appeal. However, the Republic believes
that only clerical, spelling, typographical and other innocuous errors in the
civil registry may be raised in petitions for correction under Rule 108. Thus,
the correction must only be for a patently misspelled name. As "Michael"
could not have been the result of misspelling "Michelle," petitioner
contends that the case should fall under Rule 103 for it contemplates a
substantial change.

Petitioner holds that since the applicable rule is Rule 103, Gallo was not
able to comply with the jurisdictional requirements for a change of name
under Section 2 of this Rule. It also argues that the use of a different name
is not a reasonable ground to change name under Rule 103. Further,
petitioner insists that Gallo failed to exhaust administrative remedies and
observe the doctrine of primary jurisdiction as Republic Act No. 9048
allegedly now governs the change of first name, superseding the civil
registrar's jurisdiction over the matter.

On the other hand, Gallo counters that the issue of whether or not the
petitioned corrections are innocuous or clerical is a factual issue, which is
improper in a Petition for Review on Certiorari under Rule 45. In any case,
she argues that the corrections are clerical; hence, the applicable rule is
Rule 108 and not Rule 103, with the requirements of an adversarial
proceeding properly satisfied. Lastly, she contends that petitioner has
waived its right to invoke the doctrines of non-exhaustion of
administrative remedies and primary jurisdiction when it failed to file a
594
motion to dismiss before the Regional Trial Court and only raised these
issues before this Court.

ISSUES:
A. Whether or not the Republic of the Philippines raised a question of fact
in alleging that the change sought by Michelle Soriano Gallo is substantive
and not a mere correction of error

B. Whether or not Michelle Soriano Gallo's petition involves a substantive

change under Rule 103 of the Rules of Court instead of mere correction of
clerical errors

C. Whether or not petitioner has waived its right to invoke the doctrines of
non-exhaustion of administrative remedies and primary jurisdiction

RULING:
A. The Court ruled in the negative. In assailing the Court of Appeals' ruling
that the change sought by Gallo was a mere correction of error, petitioner
raises a question of fact not proper under a Rule 45 Petition, which should
only raise questions of law. This Court is not a trier of facts. Thus, its
functions do not include weighing and analyzing evidence adduced from
the lower courts all over again.

Jurisprudence dictates that there is a "question of law" when the

doubt or difference arises as to what the law is on a certain set of facts or
circumstances; on the other hand, there is a "question of fact" when the
issue raised on appeal pertains to the truth or falsity of the alleged facts.
The test for determining whether the supposed error was one of "law" or

595
"fact" is not the appellation given by the parties raising the same; rather, it
is whether the reviewing court can resolve the issues raised without
evaluating the evidence, in which case, it is a question of law; otherwise, it
is one of fact. In the case at bar, petitioner raises an issue which requires an
evaluation of evidence as determining whether or not the change sought is
a typographical error or a substantive change requires looking into the
party's records, supporting documents, testimonies, and other evidence.

Republic Act No. 10172 defines a clerical or typographical error as a

recorded mistake, "which is visible to the eyes or obvious to the
understanding."

By qualifying the definition of a clerical, typographical error as a mistake

"visible to the eyes or obvious to the understanding," the law recognizes
that there is a factual determination made after reference to and evaluation
of existing documents presented. Thus, corrections may be made even
though the error is not typographical if it is "obvious to the understanding,"
even if there is no proof that the name or circumstance in the birth
certificate was ever used.

This Court agrees with the Regional Trial Court's determination, concurred
in by the Court of Appeals, that this case involves the correction of a mere
error. As these are findings of fact, this Court is bound by the lower courts'
findings.

B. The court ruled in the negative. Petition involves a mere correction of

clerical errors. A clerical or typographical error pertains to a mistake
committed in the performance of clerical work in writing, copying,
transcribing or typing an entry in the civil register that is harmless and
innocuous which is visible to the eyes or obvious to the understanding, and

596
can be corrected or changed only by reference to other existing record or
records. However, corrections which involve a change in nationality, age,
or status are not considered clerical or typographical.

In the case at bar, petitioner claims that the change sought by Gallo is
substantial, covered by Rule 103 because the two (2) names are allegedly
entirely different from each other. It argues that "Michael" could not have
been the result of a misspelling of "Michelle."

On the other hand, Gallo argues that the corrections are clerical which fall
under Rule 108, with the requirements of an adversarial proceeding
properly complied. Considering that Gallo had shown that the reason for
her petition was not to change the name by which she is commonly known,
this Court rules that her petition is not covered by Rule 103. Gallo is not
filing the petition to change her current appellation. She is merely
correcting the misspelling of her name. Gallo is not attempting to replace
her current appellation. She is merely correcting the misspelling of her
given name. "Michelle" could easily be misspelled as "Michael," especially
since the first four (4) letters of these two (2) names are exactly the same.
The differences only pertain to an additional letter "a" in "Michael," and "le"
at the end of "Michelle." "Michelle" and "Michael" may also be vocalized
similarly, considering the possibility of different accents or intonations of
different people. In any case, Gallo does not seek to be known by a
different appellation. The lower courts have determined that she has been
known as "Michelle" all throughout her life. She is merely seeking to
correct her records to conform to her true given name. However, Rule 108
does not apply in this case either.

As stated, Gallo filed her Petition for Correction of Entry on May 13, 2010.
The current law, Republic Act No. 10172, does not apply because it was
enacted only on August 19, 2012.
597
The applicable law then for the correction of Gallo's name is Republic Act
No. 9048 which was enacted on March 22, 2001 and removed the correction
of clerical or typographical errors from the scope of Rule 108. It also
dispensed with the need for judicial proceedings in case of any clerical or
typographical mistakes in the civil register, or changes of first name or
nickname. Thus: Section 1. Authority to Correct Clerical or Typographical
Error and Change of First Name or Nickname. - No entry in a civil register
shall be changed or corrected without a judicial order, except for clerical or
typographical errors and change of first name or nickname which can be
corrected or changed by the concerned city or municipal civil registrar or
consul general in accordance with the provisions of this Act and its
implementing rules and regulations.

Therefore, it is the civil registrar who has primary jurisdiction over Gallo's
petition, not the Regional Trial Court. Only if her petition was denied by
the local city or municipal civil registrar can the Regional Trial Court take
cognizance of her case.

Likewise, the prayers to enter Gallo's middle name as Soriano, the middle
names of her parents as Angangan for her mother and Balingao for her
father, and the date of her parents marriage as May 23, 1981 fall under
clerical or typographical errors as mentioned in Republic Act No. 9048.

Under Section 2(3) of Republic Act No. 9048: (3) "Clerical or typographical
error" refers to a mistake committed in the performance of clerical work in
writing, copying, transcribing or typing an entry in the civil register that is
harmless and innocuous, such as misspelled name or misspelled place of
birth or the like, which is visible to the eyes or obvious to the
understanding, and can be corrected or changed only by reference to other

598
existing record or records: Provided, however, That no correction must
involve the change of nationality, age, status or sex of the petitioner.

These corrections may be done by referring to existing records in the civil

register. None of it involves any change in Gallo's nationality, age, status,
or sex. Moreover, errors "visible to the eyes or obvious to the
understanding" fall within the coverage of clerical mistakes not deemed
substantial. If it is "obvious to the understanding," even if there is no proof
that the name or circumstance in the birth certificate was ever used, the
correction may be made. Thus, as to these corrections, Gallo should have
sought to correct them administratively before filing a petition under Rule
108. However, the petition to correct Gallo's biological sex was rightfully
filed under Rule 108 as this was a substantial change excluded in the
definition of clerical or typographical errors in Republic Act No. 9048.
Under Rep. Act No. 9048, a correction in the civil registry involving the
change of sex is not a mere clerical or typographical error. It is a substantial
change for which the applicable procedure is Rule 108 of the Rules of
Court. It was only when Republic Act No. 10172 was enacted on August
15, 2012 that errors in entries as to biological sex may be administratively
corrected, provided that they involve a typographical or clerical error.
However, this is not true for all cases as corrections in entries of biological
sex may still be considered a substantive matter.

C. The Court ruled in the affirmative. Under the doctrine of exhaustion of

administrative remedies, a party must first avail of all administrative
processes available before seeking the courts' intervention. The
administrative officer concerned must be given every opportunity to
decide on the matter within his or her jurisdiction. Failing to exhaust
administrative remedies affects the party's cause of action as these
remedies refer to a precedent condition which must be complied with prior
to filing a case in court. However, failure to observe the doctrine of

599
exhaustion of administrative remedies does not affect the court's
jurisdiction. Thus, the doctrine may be waived. The only effect of
noncompliance with this rule is that it will deprive the complainant of a
cause of action, which is a ground for a motion to dismiss. If not invoked at
the proper time, this ground is deemed waived and the court can then take
cognizance of the case and try it.

Meanwhile, under the doctrine of primary administrative jurisdiction, if an

administrative tribunal has jurisdiction over a controversy, courts should
not resolve the issue even if it may be within its proper jurisdiction. This is
especially true when the question involves its sound discretion requiring
special knowledge, experience, and services to determine technical and
intricate matters of fact.

Corollary to the doctrine of exhaustion of administrative remedies is the

doctrine of primary jurisdiction; that is, courts cannot or will not determine
a controversy involving a question which is within the jurisdiction of the
administrative tribunal prior to the resolution of that question by the
administrative tribunal, where the question demands the exercise of sound
administrative discretion requiring the special knowledge, experience and
services of the administrative tribunal to determine technical and intricate
matters of fact. Thus, the doctrine of primary administrative jurisdiction
refers to the competence of a court to take cognizance of a case at first
instance. Unlike the doctrine of exhaustion of administrative remedies, it
cannot be waived.

However, for reasons of equity, in cases where jurisdiction is lacking, this

Court has ruled that failure to raise the issue of non-compliance with the
doctrine of primary administrative jurisdiction at an opportune time may
bar a subsequent filing of a motion to dismiss based on that ground by way
of laches in which a party may be estopped or barred from raising a
question in different ways and for different reasons. Thus we speak of
600
estoppels in pais, of estoppel by deed or by record, and of estoppel by
laches. It has been held that a party cannot invoke the jurisdiction of a court
to secure affirmative relief against his opponent and, after obtaining or
failing to obtain such relief, repudiate or question that same jurisdiction.
The question whether the court had jurisdiction either of the subject-matter
of the action or of the parties was not important in such cases because the
party is barred from such conduct not because the judgment or order of the
court is valid and conclusive as an adjudication, but for the reason that
such a practice cannot be tolerated- obviously for reasons of public policy.

Furthermore, it has also been held that after voluntarily submitting a cause
and encountering an adverse decision on the merits, it is too late for the
loser to question the jurisdiction or power of the court. Thus, where a party
participated in the proceedings and the issue of non-compliance was raised
only as an afterthought at the final stage of appeal, the party invoking it
may be estopped from doing so.

Nonetheless, the doctrine of exhaustion of administrative remedies and the

corollary doctrine of primary jurisdiction, which are based on sound public
policy and practical considerations, are not inflexible rules. There are many
accepted exceptions, such as: (a) where there is estoppel on the part of the
party invoking the doctrine; (b) where the challenged administrative act is
patently illegal, amounting to lack of jurisdiction; (c) where there is
unreasonable delay or official inaction that will irretrievably prejudice the
complainant; ( d) where the amount involved is relatively small so as to
make the rule impractical and oppressive; ( e) where the question involved
is purely legal and will ultimately have to be decided by the courts of
justice; (f) where judicial intervention is urgent; when its application may
cause great and irreparable damage; (h) where the controverted acts violate
due process; (i) when the issue of non-exhaustion of administrative
remedies has been rendered moot; G) when there is no other plain, speedy
and adequate remedy; (k) when strong public interest is involved; and, (l)

601
in quo warranto proceedings. Petitioner does not deny that the issue of
non-compliance with these two (2) doctrines was only raised in this Court.
Thus, in failing to invoke these contentions before the Regional Trial Court,
it is estopped from invoking these doctrines as grounds for dismissal. The
Petition for Correction of Entry in the Certificate of Live Birth of Michelle
Soriano Gallo is granted and directs that the Certificate of Live

602
Ariel A. Ebuenga, Petitioner v. Southfield Agencies, Inc., Wilhemsen
Ship Management Holding Ltd., and Capt. Sonny Valencia, Respondent
G.R. No. 208396
March 14, 2018
Leonen, J.

DOCTRINE:

As a consequence, findings of fact of the NLRC, an administrative body that has

expertise in its specialized field are conclusive upon the SC. The SC does not
substitute its own judgment for that of the tribunal in determining where the
weight of evidence lies or what evidence is credible. The factual findings of the
NLRC, when affirmed by the CA, are generally conclusive on the Supreme
Court.

This Court is duty-bound to respect the consistent prior findings of the Labor
Arbiter, of the National Labor Relations Commission, and of the Court of
Appeals. It must be cautious not to substitute its own appreciation of the facts to
those of the tribunals which have previously weighed the parties' claims and
personally perused the evidence. It will not discard consistent prior findings and
an award disability benefit to a seafarer who fails to adduce even an iota of
evidence, let alone substantial evidence, and fails to draw a causal connection
between his or her alleged ailment and working conditions.

FACTS:
The assailed Court of Appeals April 29, 2013 Decision affirmed the
June 29, 2012 Decision of the National Labor Relations Commission which,
in turn, affirmed Labor Arbiter Lilia S. Savari's (Labor Arbiter Savari)
October 12, 2011 Decision,5 dismissing Ariel A. Ebuenga's (Ebuenga)
complaint6 for permanent disability benefits. The assailed Court of
603
Appeals July 26, 2013 Resolution7 denied Ebuenga's Motion for
Reconsideration.

Petitioner Ariel Ebuanga was hired as a chief cook by respondent

Southfield Agencies onboard the MTV Super Adventure owned by co-
respondent Wilhemsen Ship Management Holdings. Ebuenga boarded the
vessel on December 19, 2010. Two months later he wrote respondents
requesting to be repatriated as soon as possible in order to attend to a
“family concern”, which the latter allowed. Without consulting
respondent’s own physicians, Ebuenga had himself examined at St. Luke’s
Hospital wherein it was found that he was afflicted with "Multilevel Disk
Dessication” and was advised to undergo physical therapy. Ebuenga took
physical therapy sessions at his hometown in Legazpi City, and thereafter
sought the help of a physician who issued a Disability Report finding him
unfit for work as a seafarer. He then claimed Permanent Disability Benefits
before the Labor Arbiter. In his position paper, Ebuenga disavowed a
“family concern” as his reason for repatriation and claimed that after they
embarked a crew member died of over-fatigue, which he reported to the
International Transport Workers' Federation. The latter took no action, and
Ebuenga claims that he was coerced to sign the letter asking for
repatriation by Capt. Lecias. In their defense, respondents aver that
Ebuenga never had a medical problem onboard their vessel, and that he
was a delinquent crew member who complained about the lack of a
washing machine. Moreover, Ebuenga’s claim for disability benefits was
flawed for failure to undergo a post-employment medical examination
from a company-designated physician.

The Labor Arbiter dismissed Ebuenga’s claim for permanent disability

benefits for failure to prove that he did indeed suffer an illness while
onboard the vessel, as well as failing to undergo a post-employment
medical examination with a company-designated physician. On appeal, the
National Labor Relations Commission affirmed the LA’s dismissal of

604
Ebuanga’s claim. Ebuenga appealed to the Court of Appeals but the latter
found no grave abuse of discretion from the LA and the NLRC, hence his
Petition for Review on Certiorari under Rule 45 of the Rules of Court before
the Supreme Court. Ebuenga contends that he could not have forfeited his
claims as respondents refused to have the company-designated physician
examine him. He also insists that he came in conflict with Capt. Lecias over
the death of a co-worker, was forced to sign a letter recounting a family
emergency, and was denied assistance by Capt. Lecias when he fell ill
while on board the M/V Super Adventure.

ISSUE:

Whether or not the Supreme Court should set aside the decision of the
other tribunals.

RULING:
The court ruled in the negative. As a rule, only questions of law may be
raised in a Rule 45 petition. In a Rule 45 review, the SC considers the
correctness of the assailed CA decision. In ruling for legal correctness, the
SC has to view the CA decision in the same context that the petition for
certiorari it ruled upon was presented to it. The SC has to examine the CA
decision from the prism of whether it correctly determined the presence or
absence of grave abuse of discretion in the NLRC decision before it, not on
the basis of whether the NLRC decision on the merits of the case was
correct. The SC has to be keenly aware that the CA undertook a Rule 65
review, not a review on appeal, of the NLRC decision challenged before it.

605
As a consequence, findings of fact of the NLRC, an administrative body
that has expertise in its specialized field are conclusive upon the SC. The
SC does not substitute its own judgment for that of the tribunal in
determining where the weight of evidence lies or what evidence is credible.
The factual findings of the NLRC, when affirmed by the CA, are generally
conclusive on the Supreme Court.

In this case, the Labor Arbiter, National Labors Commission, and the Court
of Appeals are unanimous in finding that Ebuenga’s failure to adduce
additional evidence was fatal to his claim for permanent disability. He
failed to present important evidence such as when he intended to be
examined, and how Southfield actually rebuffed him. His claim for
Southfield’s failure to examine him; that of animosity, was left
unsubstantiated and lacking narratives of related incidents leading up to
the former’s refusal to have him medically examined. Ebuenga even failed
to adduce supporting proof for the alleged death of a fellow crew member,
as well as securing the testimonies of other crewmen regarding the
captain’s refusal to have the crew undergo a medical examination. Most
telling is Ebuenga’s claim that he filed a complaint before the International
Transport Worker’s Federation mid-voyage, yet failed to adduce
supporting evidence to corroborate his claim that a crewman did indeed
die onboard the ship. A party who files a Rule 45 Petition and asserts that
his or her case warrants the SC's review of factual questions bears the
burden of proving two (2) things:

First is the basic exceptionality of his or her case such that the Court must
go out of its way to revisit the evidence.

606
Second is the specific factual conclusion that he or she wants the Court to
adopt in place of that which was made by the lower tribunals.

This dual burden requires a party to not merely plead or aver. He or she
must demonstrate and prove. His or her evidentiary task persists before
the Court precisely because he or she pleads to sustain different factual
conclusions. In both requirements, petitioner Ebuenga was found lacking
and presented bare allegations to support his claim. With the utter dearth
of proof advancing petitioner's cause, the Court is constrained to sustain
the consonant findings of Labor Arbiter Savari, of the National Labor
Relations Commission, and of the Court of Appeals.

607
Eversley Childs Sanitarium, Represented by Dr. Gerardo M. Aquino, Jr.
(Dr. Primo Joel S. Alvez) Chief of Sanitarium, Petitioner v. Spouses
Anastacio and Perla Barbarona, Respondent

G.R. No. 195814

APRIL 04, 2018
Leonen, J.

DOCTRINE:

Moreover, unlike the Supreme Court, which can suspend the effectivity of its own
rules when the ends of justice require it, the Court of Appeals cannot exercise a
similar power. Only the SC may suspend the effectivity of any provision in its
Internal Rules. Thus, it would be reasonable for litigants to expect that the Court
of Appeals would comply with its own Internal Rules.

There is forum shopping when a party files different pleadings in different

tribunals, despite having the same “identities of parties, rights or causes of action,
and reliefs sought." Consistent with the principle of fair play, parties are
prohibited from seeking the same relief in multiple forums in the hope of obtaining
a favorable judgment. The rule against forum shopping likewise fulfills an
administrative purpose as it prevents conflicting decisions by different tribunals
on the same issue.

FACTS:
This is a Petition for Review on Certiorari assailing the Court of
Appeals February 17, 2011 Decision,2 which upheld the judgments of the
Municipal Trial Court and Regional Trial Court ordering Eversley Childs
Sanitarium (Eversley) to vacate the disputed property. Eversley assails the
August 31, 2011 Resolution3 of the Court of Appeals for resolving its

608
Motion for Reconsideration despite its earlier submission of a Motion to
Withdraw the Motion for Reconsideration.

Petitioner Eversley Childs Sanitarium (Petitioner) operates a medical

facility under the Department of Health for the treatment of leprosy. It
occupies a parcel of land in Jagobiao, Mandaue City, Cebu and has been in
operation since 1930. On May 6, 2005, respondents Spouses Barbarona
(Respondent) filed a Complaint for Ejectment against Petitioner for them to
vacate the parcel of land where their Sanitarium stood. Respondents
alleged that they had sent demand letters and that the occupants were
given until April 15, 2005 to vacate the premises. They further claimed that
despite the lapse of the period, the occupants refused to vacate; hence, they
were constrained to file the Complaint.

The Municipal Trial Court in Cities (MTCC) ordered the occupants to

vacate the property, finding that the action was one for unlawful detainer,
and thus, within its jurisdiction. It likewise found that the respondents
were the lawful owners of Lot No. 1936 and that the occupants were
occupying the property by mere tolerance. The occupants appealed to the
RTC and such court approved the MTCC decision in toto. One of the
occupants, petitioner, filed a motion for reconsideration before the
Regional Trial Court but was denied.

Petitioner filed a Petition for Review with the CA, arguing that the MTC
had no jurisdiction over the action and that the RTC erred in not
recognizing that the subsequent invalidation of the respondent's certificate
of title was prejudicial to their cause of action. The CA rendered its
Decision denying the Petition. According to the CA , the allegations in the
Complaint were for the recovery of the physical possession of the property
and not a determination of the property's ownership. The action, thus, was
one for unlawful detainer and was properly filed with the MTC.

609
Petitioner, represented by the OSG, filed a Petition for Review before the
Court assailing the February 17, 2011 Decision of the Court of Appeals. It
likewise prayed for the issuance of a Temporary Restraining Order and/or
Writ of Preliminary Injunction to restrain the immediate execution of the
assailed judgment and to prevent impairing the operations of the
government hospital, which had been serving the public for more than 80
years. This the Supreme Court granted.

While the Petition was pending before the Supreme Court, respondent
raised a few procedural concerns and informed the Court that Eversley still
had a pending and unresolved Motion for Reconsideration before the
Court of Appeals, in violation of the rule against forum shopping.
Respondent, nonetheless, filed their Comment/Manifestation, to which the
SC ordered petitioner to reply.

Petitioner filed its Reply and submitted a Manifestation, explaining that the
CA had issued Resolution on August 31, 2011, denying its Motion for
Reconsideration despite its earlier filing on April 14, 2011 of a
Manifestation and Motion to Withdraw its Motion for Reconsideration.
Thus, it manifested its intention to likewise question the CA August 31,
2011 Resolution with the SC.

Respondents assert that while petitioner submitted a Manifestation and

Motion to Withdraw its Motion for Reconsideration, the CA did not issue
any order considering petitioner's Motion for Reconsideration to have been
abandoned. The CA instead proceeded to resolve it in its August 31, 2011
Resolution; hence, respondents submit that petitioner violated the rule on
non-forum shopping.

610
ISSUE:
Whether or not Eversley Childs Sanitarium violated the rule on non-forum
shopping.

RULING:
The court ruled in the negative. Forum shopping is committed by a party
who institutes two or more suits in different courts, either simultaneously
or successively, in order to ask the courts to rule on the same or related
causes or to grant the same or substantially the same reliefs, on the
supposition that one or the other court would make a favorable disposition
or increase a party's chances of obtaining a favorable decision or action.
There is forum shopping when a party files different pleadings in different
tribunals, despite having the same identities of parties, rights or causes of
action, and reliefs sought. Consistent with the principle of fair play, parties
are prohibited from seeking the same relief in multiple forums in the hope
of obtaining a favorable judgment. The rule against forum shopping
likewise fulfills an administrative purpose as it prevents conflicting
decisions by different tribunals on the same issue. Petitioner, through the
Office of the Solicitor General, is alleged to have committed forum
shopping when it filed its Petition for Review on Certiorari with the
Supreme Court, despite a pending Motion for Reconsideration with the
Court of Appeals.

According to the Solicitor General, it filed a Motion for Extension of Time

to File a Petition for Review on Certiorari with the Supreme Court on
March 10, 2011 but that another set of solicitors erroneously filed a Motion
for Reconsideration with the Court of Appeals on March 11, 2011. Thus, it
was constrained to file a Manifestation and Motion to Withdraw its Motion
for Reconsideration on April 14, 2011, the same date as its Petition for
Review on Certiorari with this Court.

611
The Office of the Solicitor General, however, mistakenly presumed that the
mere filing of a motion to withdraw has the effect of withdrawing the
motion for reconsideration without having to await the action of the Court
of Appeals.

The Office of the Solicitor General's basis is its reading of Rule VI, Section
15 of the 2002 Internal Rules of the Court of Appeals:

Section 15. Effect of Filing an Appeal in the Supreme Court. – No motion

for reconsideration or rehearing shall be acted upon if the movant has
previously filed in the Supreme Court a petition for review on certiorari or
a motion for extension of time to file such petition. If such petition or
motion is subsequently filed, the motion for reconsideration pending in
this Court shall be deemed abandoned.

This would have been true had the Office of the Solicitor General merely
manifested that it had already considered its Motion for Reconsideration
before the Court of Appeals as abandoned, pursuant to its Internal Rules.
However, it filed a Motion to Withdraw, effectively submitting the
withdrawal of its Motion for Reconsideration to the Court of Appeals'
sound discretion. A motion is not presumed to have already been acted
upon by its mere filing. Prudence dictated that the Office of the Solicitor
General await the Court of Appeals' action on its Motion to Withdraw
before considering its Motion for Reconsideration as withdrawn.

When the Court of Appeals denied the Office of the Solicitor General's
Motion for Reconsideration without acting on its Motion to Withdraw, the
latter was effectively denied. Petitioner, thus, committed forum shopping

612
when it filed its Petition before the Supreme Court despite a pending
Motion for Reconsideration before the Court of Appeals.

To rule in this manner, however, is to unnecessarily deprive petitioner of

its day in court despite the Court of Appeals' failure to apply its own
Internal Rules. The Internal Rules of the Court of Appeals clearly provide
that a subsequent motion for reconsideration shall be deemed abandoned if
the movant filed a petition for review or motion for extension of time to file
a petition for review before the Supreme Court. While the Office of the
Solicitor General can be faulted for filing a motion instead of a mere
manifestation, it cannot be faulted for presuming that the Court of Appeals
would follow its Internal Rules as a matter of

Moreover, unlike the Supreme Court, which can suspend the effectivity of
its own rules when the ends of justice require it, the Court of Appeals
cannot exercise a similar power. Only the SC may suspend the effectivity of
any provision in its Internal Rules. Thus, it would be reasonable for
litigants to expect that the Court of Appeals would comply with its own
Internal Rules. Petitioner's Motion for Reconsideration having been
deemed abandoned with its filing of a Motion for Extension of Time before
this Court, the Court of Appeals' August 31, 2011 Resolution denying the
Motion for Reconsideration, thus, has no legal effect. It is as if no motion
for reconsideration was filed at all. In this particular instance, petitioner
did not commit a fatal procedural error.

613
 Perfecto M. Pascua, Petitioner, V. Bank Wise, Inc. and Philippine
Veterans Bank, Respondent

G.R. No. 191460

January 31, 2018

Leonen, J.

DOCTRINE:

NLRC Decision attained finality when the records of the case were remanded to the
Labor Arbiter and a writ of execution was issued. Under the 2005 NLRC Revised
Rules of Procedure, execution proceedings only commence upon the finality of the
National Labor Relations Commission's judgment.

FACTS:

Pascua was employed by Bankwise as its Executive Vice President for

Marketing. In 2004, Philippine Veterans Bank and Bankwise entered into a
Memorandum of Agreement for the purchase of Bankwise's entire
outstanding capital stock.

On February 3, 2005, Pascua was informed by Roberto A. Buhain, President

of Bankwise, that as part of the merger or trade-off agreement with
Philippine Veterans Bank, he should tender his resignation. Seeing as
Pascua had yet to submit his resignation, Vicente Campa, a director of
Bankwise, told him that it was imperative that he submit his resignation
and assured his continued service with Philippine Veterans Bank. Based on
Campa's assurance, Pascua tendered his resignation on February 22, 2005.

Pascua wrote a letter to Campa reminding him of his money claims due to
his resignation. Pascua informed Buhain that per Buhain's suggestion, he

614
asked Campa to request Bankwise's Board of Directors for the extension of
his service until August 30, 2005. Both Philippine Veterans Bank and
Bankwise, however, denied the request.

Due to the inaction of Philippine Veterans Bank and Bankwise, Pascua led
a Complaint for illegal dismissal against Bankwise and Philippine Veterans
Bank.

The Labor Arbiter dismissed the Complaint on the ground that Pascua had
voluntarily resigned. The NLRC reversed the Labor Arbiter's findings and
held that Pascua was constructively dismissed.

Philippine Veterans Bank and Bankwise filed separate Motions for

Reconsideration before the National Labor Relations Commission. In its
Resolution, the NLRC resolved to deny the Motions for Reconsideration
filed "by the respondents" even though it only mentioned the December 14,
2007 Motion for Reconsideration.

ISSUE:

Whether or Not the NLRC Decision denying Philippine Veterans Bank’s

Motion for Reconsideration also resolved Bankwise’s Motion for
Reconsideration?

RULING: YES

The NLRC resolved both motions in a Resolution which already attained

finality when the records of the case were remanded to the Labor Arbiter
and a writ of execution was issued in Pascua's favor.

615
Under the 2005 NLRC Revised Rules of Procedure, execution proceedings
only commence upon the finality of the National Labor Relations
Commission's judgment.

By August 7, 2008, the records of the case were remanded to the Labor
Arbiter for execution. Thus, the National Labor Relations Commission
already considered its March 14, 2008 Resolution as final and executory to
all parties, including Bankwise. Bankwise was also given notice of the said
Resolution, so it cannot claim that the Resolution only resolved Philippine
Veterans Bank's Motion for Reconsideration. The Order was a definitive
notice to Bankwise that the NLRC considered its judgment final and
executory against Bankwise. Thus, Bankwise is bound by the finality of the
NLRC Decision.

616
 People of the Philippines, plaintiff-appellee, V. Joshua Que Y Utuanis,
accused-appellant

G.R. No. 212994

January 31, 2018

Leonel, J.

DOCTRINE:

The following links should be established in the chain of custody of the confiscated
item:

first, the seizure and marking, if practicable, of the illegal drug recovered from the
accused by the apprehending officer;

second, the turnover of the illegal drug seized by the apprehending officer to the
investigating officer;

third, the turnover by the investigating officer of the illegal drug to the forensic
chemist for laboratory examination; and

fourth, the turnover and submission of the marked illegal drug seized from the
forensic chemist to the court.

Failure to comply with Paragraph 1, Section 21, Article II of RA 9165 implies a

concomitant failure on the part of the prosecution to establish the identity of the
corpus delicti. It produces doubts as to the origins of the seized paraphernalia.

FACTS:

In two (2) separate Informations, accused-appellant Que was charged

with violating Sections 5 and 11 of the Comprehensive Dangerous Drugs
Act.

617
During the hearings for the bail petition, the prosecution presented three
(3) witnesses: the poseur-buyer, PO3 Sammy Romina Lim; the arresting
officer, SPO1 Samuel Tan Jacinto; and forensic chemist Police Chief
Inspector Mercedes D. Diestro.

PO3 Lim recounted that on July 26, 2003, an informant reported that a
person identified as "Joshua," later identified as Que, was selling shabu.
Acting on this report, P/C Insp. Nickson Babul Muksan organized a buy-
bust operation with PO3 Lim as poseur-buyer. PO3 Lim then told Que that
he intended to purchase P100.00 worth of shabu. Que then handed him
shabu inside a plastic cellophane. In turn, PO3 Lim handed Que the
marked P100.00 bill and gave the pre-arranged signal to have Que arrested.

After the arrest, the marked bill and another sachet of shabu were
recovered from Que. Que was then brought to the police station where the
sachets of shabu and the marked bill were turned over to the investigator,
SPO4 Eulogio Tubo, who then marked these items with his initials.

P/C Insp. Diestro recounted their office's receipt of a request for laboratory
examination of the contents of two (2) plastic sachets. She noted that these
contents tested positive for shabu.

ISSUE:

Whether or Not Que’s guilt for violating Sec. 5 and 11 of the CDDA of 2002
was proven beyond reasonable doubt

RULING: NO

The following links should be established in the chain of custody of the

confiscated item:
618
first, the seizure and marking, if practicable, of the illegal drug recovered
from the accused by the apprehending officer;

second, the turnover of the illegal drug seized by the apprehending officer
to the investigating officer;

third, the turnover by the investigating officer of the illegal drug to the
forensic chemist for laboratory examination; and

fourth, the turnover and submission of the marked illegal drug seized from
the forensic chemist to the court.

This case is tainted with grave, gratuitous violations of Section 21 (1). There
is no showing that a proper inventory and taking of pictures was done by
the apprehending officers. The marking of the sachets of shabu supposedly
obtained from Que was conducted at a police station without accused-
appellant, or any person representing him, around. There was not even a
third person, whose presence was required by Section 21 (1) prior to its
amendment — "a representative from the media and the Department of
Justice (DOJ), and any elected public official."

Failure to comply with Paragraph 1, Section 21, Article II of RA 9165

implies a concomitant failure on the part of the prosecution to establish the
identity of the corpus delicti. It produces doubts as to the origins of the
seized paraphernalia.

619
 In the Matter of the Petition for Habeas Corpus, SSGT. Edgardo L.
Osorio, Petitioner, V. Assistant State Prosecutor Juan Pedro C. Navera; et
al, and/or any and all persons who may have actual custody over the
person of SSGT. Edgardo L. Osorio, Respondents.

G.R. No. 223272

February 26, 2018

Leonel, J.

DOCTRINE:

A writ of habeas corpus may no longer be issued if the person allegedly deprived of
liberty is restrained under a lawful process or order of the court. If an accused is
confined under a lawful process or order of the court, the proper remedy is to
pursue the orderly course of trial and exhaust the usual remedies. This ordinary
remedy is to file a motion to quash the information or the warrant of arrest based
on one or more of the grounds enumerated in Rule 117, Section 3 of the Rules of
Court.

Republic Act No. 7055, Section 1 provides that if the accused is a member of the
Armed Forces of the Philippines and the crime involved is one punished under the
Revised Penal Code, civil courts shall have the authority to hear, try, and decide
the case. Under this Section, the only time courts-martial may assume jurisdiction
is if, before arraignment, the civil court determines that the offense is "service-
connected."

FACTS:

Together with his superior officer, Major General Jovito Palparan,

SSgt. Osorio was charged in two (2) Informations for allegedly kidnapping

620
University of the Philippines students Karen E. Empeño and Sherlyn T.
Cadapan.

Warrants of arrest were issued against SSgt. Osorio on December 19, 2011.
The next day, SSgt. Osorio was arrested by Colonel Herbert Yambing, the
Provost Marshall General of the Armed Forces of the Philippines.

Contending that he was being illegally deprived of his liberty, SSgt. Osorio
led a Petition for Habeas Corpus before the Court of Appeals. SSgt. Osorio
mainly argued that courts-martial, not a civil court such as the Regional
Trial Court, had jurisdiction to try the criminal case considering that he
was a soldier on active duty and that the offense charged was allegedly
"service-connected." SSgt. Osorio added that he could not be charged with
the felony of kidnapping and serious illegal detention because under
Article 267 of the Revised Penal Code, the felony may only be committed
by a private individual, not a ranking officer of the Armed Forces of the
Philippines.

ISSUES:

(1) whether or not a writ of habeas corpus is petitioner SSgt. Osorio's

proper remedy; and

(2) whether or not a civil court may take cognizance of a criminal case
against a soldier on active duty.

RULING:

(1) NO. A writ of habeas corpus may no longer be issued if the person
allegedly deprived of liberty is restrained under a lawful process or order

621
of the court. The restraint then has become legal. Therefore, the remedy of
habeas corpus is rendered moot and academic.

If an accused is confined under a lawful process or order of the court, the

proper remedy is to pursue the orderly course of trial and exhaust the
usual remedies. This ordinary remedy is to file a motion to quash the
information or the warrant of arrest based on one or more of the grounds
enumerated in Rule 117, Section 3 of the Rules of Court.

(2) NO. The Regional Trial Court properly took cognizance of the
kidnapping case against him. Republic Act No. 7055, Section 1 provides
that if the accused is a member of the Armed Forces of the Philippines and
the crime involved is one punished under the Revised Penal Code, civil
courts shall have the authority to hear, try, and decide the case. Under this
Section, the only time courts-martial may assume jurisdiction is if, before
arraignment, the civil court determines that the offense is "service-
connected."

Contrary to SSgt. Osorio's claim, the offense he committed was not service-
connected. The case led against him is none of those enumerated under
Articles 54 to 70, Articles 72 to 92, and Articles 95 to 97 of the Articles of
War.

622
 Intramuros Administration, Petitioner, V. Offshore Construction
Development Company, Respondent.

G.R. No. 196795

March 7, 2018

Leonel, J.

DOCTRINE:

A question of law exists when the law applicable to a particular set of facts
is not settled, whereas a question of fact arises when the truth or falsehood
of alleged facts is in doubt.

A petition for review under Rule 42 may include questions of fact, of law,
or mixed questions of fact and law. SC has recognized that the power to
hear cases on appeal in which only questions of law are raised is not vested
exclusively in the Supreme Court.

The doctrine of hierarchy of courts is not inviolable, and the SC has

provided several exceptions to the doctrine. One of these exceptions is the
exigency of the situation being litigated.

It is settled that the only issue that must be settled in an ejectment

proceeding is physical possession of the property involved.

The test to determine whether a party violated the rule against forum
shopping is whether the elements of litis pendentia are present, or whether
a final judgment in one case will amount to res judicata in another. Simply
put, when litis pendentia or res judicata does not exist, neither can forum
shopping exist.

623
FACTS:

Intramuros leased certain real properties of the national government,

which it administered to Offshore Construction. Three (3) properties were
subjects of Contracts of Lease: Baluarte De San Andres, Baluarte De San
Francisco De Dilao, and Revellin De Recoletos. All three (3) properties were
leased for five (5) years.

During the lease period, Offshore Construction failed to pay its utility bills
and rental fees, despite several demand letters. Intramuros tolerated the
continuing occupation, hoping that Offshore Construction would pay its
arrears. As of July 31, 2004, these arrears allegedly totalled P6,762,153.70.

Offshore Construction occupied and introduced improvements in the

leased premises. However, Intramuros and the Department of Tourism
halted the projects due to Offshore Construction's non-conformity with
Presidential Decree No. 1616, which required 16th to 19th centuries'
Philippine-Spanish architecture in the area which led to a civil case.

To settle its arrears, Offshore Construction proposed to pay the

Department of Tourism's monthly operational expenses for lights and
sound equipment, electricity, and performers at the Baluarte Plano Luneta
de Sta. Isabel. However, Offshore Construction continued to fail to pay its
arrears, which amounted to P13,448,867.45 as of December 31, 2009. On
March 26, 2010, Offshore Construction received Intramuros' latest demand
letter.

Intramuros filed a Complaint for Ejectment before the MeTC on April 28,
2010. Offshore Construction filed a Very Urgent Motion, praying that
Intramuros' complaint be dismissed on the grounds of violation of the rule
on non- forum shopping, lack of jurisdiction over the case, and litis
pendentia.

624
The MeTC found that Intramuros committed forum shopping and that it
had no jurisdiction over the case. Intramuros appealed the Order with the
RTC. However, the RTC affirmed the MeTC Order in toto. Intramuros
filled its Petition for Review on Certiorari, assailing the Decision of the
Regional Trial Court.

ISSUES:

(1) whether or not direct resort to the Supreme Court is proper

(2) whether or not the Metropolitan Trial Court had jurisdiction over the
ejectment complaint filed by Intramuros Administration

(3) whether or not Intramuros Administration committed forum shopping

when it led its ejectment complaint despite the pending cases for specific
performance and interpleader

RULING:

(1) YES. Petitioner's resort to this Court is proper and warranted under the
circumstances.

Petitioner puts in issue the findings of the MTC that it has no jurisdiction
over the ejectment complaint and that petitioner committed forum
shopping when it failed to disclose two (2) pending cases, one led by
respondent Offshore Construction and the other led by respondent's group
of tenants, 4H Intramuros. Both of these cases raise questions of law, which
are cognizable by the Court of Appeals in a petition for review under Rule
42.

625
A question of law exists when the law applicable to a particular set of facts
is not settled, whereas a question of fact arises when the truth or falsehood
of alleged facts is in doubt. SC has ruled that the jurisdiction of a court over
the subject matter of a complaint and the existence of forum shopping are
questions of law.

A petition for review under Rule 42 may include questions of fact, of law,
or mixed questions of fact and law. SC has recognized that the power to
hear cases on appeal in which only questions of law are raised is not vested
exclusively in the Supreme Court.

Petitioner’s direct resort to this Court, instead of to the Court of Appeals

for intermediate review as sanctioned by the rules, violates the principle of
hierarchy of courts. Nonetheless, the doctrine of hierarchy of courts is not
inviolable, and the SC has provided several exceptions to the doctrine. One
of these exceptions is the exigency of the situation being litigated. Here, the
controversy between the parties has been dragging on since 2010, which
should not be the case when the initial dispute — an ejectment case — is,
by nature and design, a summary procedure and should have been
resolved with expediency. Moreover, this Court's rules of procedure permit
the direct resort to this Court from a decision of the Regional Trial Court
upon questions of law, such as those which petitioner raises in this case.

(2) YES. MTC has jurisdiction over the ejectment complaint.

It is settled that the only issue that must be settled in an ejectment

proceeding is physical possession of the property involved. Specifically,
action for unlawful detainer is brought against a possessor who unlawfully
withholds possession after the termination and expiration of the right to
hold possession.

626
To determine the nature of the action and the jurisdiction of the court, the
allegations in the complaint must be examined. The jurisdictional facts
must be evident on the face of the complaint. There is a case for unlawful
detainer if the complaint states the following:

initially, possession of property by the defendant was by contract

with or by tolerance of the plaintiff;

eventually, such possession became illegal upon notice by plaintiff to

defendant of the termination of the latter's right of possession;

thereafter, the defendant remained in possession of the property and

deprived the plaintiff of the enjoyment thereof; and

within one year from the last demand on defendant to vacate the
property, the plaintiff instituted the complaint for ejectment.

A review of petitioner's Complaint for Ejectment shows that all of these

allegations were made.

The MTC seriously erred in finding that it did not have jurisdiction over
petitioner's complaint because the parties' situation has allegedly become
"more complicated" than one of lease. Respondent's defense that its
relationship with petitioner is one of concession rather than lease does not
determine whether or not the Metropolitan Trial Court has jurisdiction
over petitioner's complaint.

(3) NO. There is no forum shopping in the case at bar.

Forum shopping is the practice of resorting to multiple fora for the same
relief, to increase the chances of obtaining a favorable judgment.

The test to determine whether a party violated the rule against forum
shopping is whether the elements of litis pendentia are present, or whether
a final judgment in one case will amount to res judicata in another. Simply
627
put, when litis pendentia or res judicata does not exist, neither can forum
shopping exist.

The requisites of litis pendentia are: (a) the identity of parties, or at least
such as representing the same interests in both actions; (b) the identity of
rights asserted and relief prayed for, the relief being founded on the same
facts; and (c) the identity of the two cases such that judgment in one,
regardless of which party is successful, would amount to res judicata in the
other. On the other hand, the elements of res judicata, also known as bar by
prior judgment, are: (a) the former judgment must be nal; (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.

As observed by the MTC, there is an identity of parties in the specific

performance and interpleader cases, and the Complaint for Ejectment.
However, there is no identity of asserted rights or reliefs prayed for, and a
judgment in any of the three (3) cases will not amount to res judicata in the
two others.

A final judgment in the specific performance case will not affect the
outcome of the ejectment case. The Memorandum of Agreement subject of
the specific performance case cannot be the source of respondent's
continuing right of possession, as it expressly stated there that the
offsetting was only for respondent's outstanding arrears as of July 31, 2004.
Any favorable judgment compelling petitioner to comply with its
obligation under this agreement will not give new life to the expired
Contracts of Lease, such as would repel petitioner's unlawful detainer
complaint.

628
 Teodoro C. Tortona, et al, Petitioner, V. Julian C. Gregorio, et al,
Respondents.

G.R. No. 202612

January 17, 2018

Leonel, J.

DOCTRINE:

Factual issues are normally improper in Rule 45 petitions as, under Rule 45 of the
1997 Rules of Civil Procedure, only questions of law may be raised in a petition for
review on certiorari. However, the rule admits of exceptions. The exceptions are as
follows:

(1) When the conclusion is a finding grounded entirely on speculation, surmises or

conjectures; (2) When the inference made is manifestly mistaken, absurd or
impossible; (3) Where there is a grave abuse of discretion; (4) When the judgment
is based on a misapprehension of facts; (5) When the findings of fact are
conflicting; (6) When the Court of Appeals, in making its findings, went beyond
the issues of the case and the same is contrary to the admissions of both appellant
and appellee; (7) The findings of the Court of Appeals are contrary to those of the
trial court; (8) When the findings of fact are conclusions without citation of
specific evidence on which they are based; (9) When the facts set forth in the
petition as well as in the petitioner's main and reply briefs are not disputed by the
respondents; and (10) The finding of fact of the Court of Appeals is premised on the
supposed absence of evidence and is contradicted by the evidence on record.

FACTS:

During their lifetime, Rufina and Rafaela co-owned with their other
siblings two (2) parcels of land. When Rufina was still alive, she regularly

629
collected her respective 1/10 and 1/5 shares in the income of the two (2)
properties. After her death, petitioners continued to collect and receive
their mother's share.

Sometime in 1997, petitioners filed a complaint for recovery of real

property with damages. They alleged that their cousin Emilio Casimiro
(Emilio) offered them a balato of P50,000.00 for the sale of the first parcel to
the Department of Public Works and Highways. Surprised, they asked why
they were not instead given their 1/10 share in the proceeds of the sale. To
this, Emilio allegedly replied that according to respondents, the two
properties had already been sold by Rufina to Rafaela during their lifetime.

Petitioners underscored that their mother was illiterate, not even knowing
how to write her own name. They alleged that she only a fixed her thumb
mark on documents, and whenever she did so, she was always assisted by
at least one (1) of her children. Thus, they asserted that if the sales to
Rafaela were genuine, they should have known about them. In support of
their allegations, they presented during trial some documents, collectively
identified as the standard documents, supposedly bearing the authentic
thumb marks of their mother. These standard documents also showed that
at least one (1) of them assisted her in executing each document.

ISSUE:
Whether or not the Deed of Absolute Sale allegedly executed by Rufina
Casimiro and Rafaela Casimiro is void

RULING: YES
The matter of the authenticity of Rufina Casimiro's thumb marks is a
factual issue resting on the evidence presented during trial.

630
Factual issues are normally improper in Rule 45 petitions as, under Rule 45
of the 1997 Rules of Civil Procedure, only questions of law may be raised in
a petition for review on certiorari. However, the rule admits of exceptions.
The exceptions are as follows:

(1) When the conclusion is a finding grounded entirely on speculation,

surmises or conjectures; (2) When the inference made is manifestly
mistaken, absurd or impossible; (3) Where there is a grave abuse of
discretion; (4) When the judgment is based on a misapprehension of facts;
(5) When the findings of fact are conflicting; (6) When the Court of
Appeals, in making its findings, went beyond the issues of the case and the
same is contrary to the admissions of both appellant and appellee; (7) The
findings of the Court of Appeals are contrary to those of the trial court; (8)
When the findings of fact are conclusions without citation of specific
evidence on which they are based; (9) When the facts set forth in the
petition as well as in the petitioner's main and reply briefs are not disputed
by the respondents; and (10) The finding of fact of the Court of Appeals is
premised on the supposed absence of evidence and is contradicted by the
evidence on record.

Several exceptions exist in this case. Most evident is how the findings and
conclusions of the Court of Appeals conflict with those of the Regional
Trial Court. More significant than these conflicting findings, this Court
finds the Court of Appeals' appreciation of evidence to be grossly
misguided. Contrary to the Court of Appeals' findings, a more circumspect
consideration of the evidence sustains the conclusion that Rufina's
purported thumb marks were false and merely simulated to make it appear
that she had consented to the alleged sale to her sister, Rafaela.

631
 METRO RAIL TRANSIT DEVELOPMENT CORPORATION, petitioner,
vs. GAMMON PHILIPPINES, INC., respondent.

G.R. No. 200401

January 17, 2018

LEONEN, J.

DOCTRINE:
The Court will not review the factual findings of an arbitral tribunal upon the
artful allegation that such body had "misapprehended the facts" and will not
pass upon issues which are, at bottom, issues of fact, no matter how cleverly
disguised they might be as "legal questions” save only where a very clear
showing is made that, in reaching its factual conclusions, the Arbitral Tribunal
committed an error so egregious and hurtful to one party as to constitute a
grave abuse of discretion resulting in lack or loss of jurisdiction.

FACTS:

This case involves MRT's MRT-3 North Triangle Description Project

(Project) covering land and commercial center, half of which would be
used as a Podium.

Parsons Interpro JV (Parsons) was the Management Team authorized to

oversee the construction's execution. While the respondent (Gammon) won
the bid for the complete concrete works of the Podium.

Podium has issued a Letter of Award and Notice to Proceed (First Notice to
Proceed) to Gammon. However, on September 8, 1997, MRT wrote
Gammon that it would need one (1) or two (2) weeks before it could issue
the latter the Formal Notice to Proceed.

Parsons then directed Gammon "to hold any further mobilization

activities” and confirmed "the temporary suspension of all the
requirements under the contract except the re-design of the project floor
slabs and the site de-watering and clean up."

632
Thereafter, MRT decided to downscale the Podium's construction and to
proceed with the Project's conceptual redesign. Upon Parson's request
order, Gammon studied and discussed with MRT the best option to phase
the work. MRT decided to adopt Gammon's recommendation. Due to these
revisions on the scope of work, MRT asked Gammon to re-design.

On February 18, 1998, Parsons issued Gammon a Second Notice to Proceed

for the engineering services based on the redesigned plan. Gammon signed
the Second Notice to Proceed on March 11, 1998 with qualification.

On March 3, 1998, Gammon submitted to Parsons a Revised Lump Sum

Price Proposal of the Podium up to Level 2, including the design of the
floor slab. At this time, Gammon had already started its engineering
services pursuant to the Second Notice to Proceed.

On April 2, 1998, MRT issued in favor of Gammon Third Notice to Proceed

to which Gammon acknowledged but with a request for clarification of
certain items. Thereafter, Parsons informed Gammon that MRT was
temporarily rescinding the Third Notice to Proceed, noting that it remained
unaccepted by Gammon.

Despite such, Gammon received from Parsons the Contract for the
Construction and Development and Amended Notice to Proceed (Fourth
Notice to Proceed). It is noted that the terms of the Fourth Notice to
Proceed were different from those of the First and the Third Notices to
Proceed, and has also expressly cancelled the said notices.

This prompted Gammon to qualifiedly accept the Fourth Notice to Proceed

which the MRT treated as new offer. That on June 22, 1998, MRT rejected
the same and informed Gammon that the contract would be awarded
instead to Filsystems.

Accordingly, on July 8, 1998, Gammon wrote MRT, acknowledging the

latter's intent to grant the Fourth Notice to Proceed to another but notified
MRT of its claims for reimbursements on costs and expenses it had
incurred in response to MRT's additional work instructions, suspension
633
order, ongoing discussions, and the consequences of its award to another
party.

To its reply, MRT informed Gammon that it was willing to reimburse its
cost in participating in the bid amounting to about 5% of Gammon's total
claim of more or less P121,000,000.00, to which Gammon disagreed.

Accordingly, Gammon filed a Notice of Claim before CIAC against MRT.

On March 27, 2007, CIAC ruled as follows:

MRT assailed the CIAC Decision before the Court of Appeals (CA) but the
CA affirmed the same. Hence, this present Petition for Review.

MRT argues that Gammon was not entitled to CIAC's award since there is
no perfected contract between them and Gammon's claim for lost profits
and reimbursements was based only on an unsubstantiated and self-
serving assertions as it was not supported by official receipts.

Gammon claims that MRT is raising factual issues and that CIAC's factual
findings on the existence of the contract and the amount of damages ought
to be respected.

634
ISSUE:
Whether or not the findings of CIAC are all contrary to evidence on record
or are premised on speculation, surmises, and conjectures, and thus, are
serious errors of law properly re-examinable by this Court?

RULING:
No. This Court denies the petition and affirms the findings of CIAC
and of the Court of Appeals.

CIAC was created under Executive Order No. 1008 to establish an

arbitral machinery that will settle expeditiously problems arising from, or
connected with, contracts in the construction industry.

It is a quasi-judicial body exercising quasi-judicial powers over arbitration

disputes concerning construction contracts. Quasi-judicial or
administrative adjudicatory power has been defined as the power: "(1) to
hear and determine questions of fact to which legislative policy is to apply,
and (2) to decide in accordance with the standards laid down by the law
itself in enforcing and administering the same law."

Its findings are accorded respect because it comes with the presumption
that CIAC is technically proficient in efficiently and speedily resolving
conflicts in the construction industry.

Under the Construction Industry Arbitration Law, arbitral awards

are
binding and shall be final and unappealable, except on pure questions of
law:

Section 19. Finality of Awards. — The arbitral award shall be binding

upon the parties. It shall be final and inappealable except on
questions of law which shall be appealable to the Supreme Court.

635
Initially, CIAC decisions are appealable only to this Court. However, when
the Rules of Court were enacted, appeals from CIAC decisions became
appealable to the CA under Rule 43:

Section 1. Scope. — This Rule shall apply to appeals from judgments

or final orders of the Court of Tax Appeals and from awards,
judgments, final orders or resolutions of or authorized by any quasi-
judicial agency in the exercise of its quasi-judicial functions. Among
these agencies are … Construction Industry Arbitration Commission,
and voluntary arbitrators authorized by law.

While Rule 43 petitions may pertain to questions of fact, questions of

law, or both, it has been established that factual findings of CIAC may not
be reviewed on appeal.

As explained in Hi-Precision Steel Center, Inc. v. Lim Kim Steel Builders,

Inc., Section 19 makes it crystal clear that questions of fact cannot be raised
in proceedings before the Supreme Court — which is not a trier of facts —
in respect of an arbitral award rendered under the aegis of the CIAC.
Consideration of the animating purpose of voluntary arbitration in general
and arbitration under the aegis of the CIAC in particular, which is to
provide a speedy and inexpensive method of settling disputes by allowing
the parties to avoid the formalities, delay, expense and aggravation which
commonly accompany ordinary litigation, especially litigation which goes
through the entire hierarchy of courts, requires this Court to apply the
above stated principle.

Thus, CIAC's factual findings on construction disputes are final,

conclusive, and not reviewable by this Court on appeal, except when: (1)
the award was procured by corruption, fraud or other undue means; (2)
there was evident partiality or corruption of the arbitrators or of any of
them; (3)the arbitrators were guilty of misconduct in refusing to postpone
the hearing upon sufficient cause shown, or in refusing to hear evidence
pertinent and material to the controversy; (4) one or more of the arbitrators
were disqualified to act as such under section nine of Republic Act No. 876
and willfully refrained from disclosing such disqualifications or of any
other misbehavior by which the rights of any party have been materially
636
prejudiced; or (5) the arbitrators exceeded their powers, or so imperfectly
executed them, that a mutual, final and definite award upon the subject
matter submitted to them was not made.

Here, MRT is raising questions of fact. However, petitioner failed to prove

that any of these exceptions are present in the case at bar. Thus, this Court
will no longer disturb CIAC's factual findings, which were affirmed by the
Court of Appeals.

637
 LAND BANK OF THE PHILIPPINES, petitioner, vs. RAUL T.
MANZANO, JOSE R. JUGO, RAMON H. MANZANO, and HEIRS of
PILAR T. MANZANO, namely: RICARDO T. MANZANO, JR.,
RENATO T. MANZANO, JR., RAMON T. MANZANO, JR., RAUL T.
MANZANO, RAFAEL T. MANZANO, ROBERTO T. MANZANO, and
REGINA T. MANZANO, respondents.

G.R. No. 188243

January 24, 2018

LEONEN, J.

DOCTRINE:
Execution of the judgment or final order pending appeal is discretionary. The
existence of good reasons is what confers discretionary power on a court to issue
a writ of execution pending appeal. "Good reasons" consist of compelling or
superior circumstances demanding urgency which will outweigh the injury or
damages suffered should the losing party secure a reversal of the judgment or
final order.

FACTS:

The respondents were the owner of four (4) parcels of agricultural

land planted with rubber trees and with a total land area of 88.5667
hectares.

The enactment of Republic Act No. 6657, or the Comprehensive

Agrarian Reform Law, has placed suitable agricultural lands under the
coverage of the Comprehensive Agrarian Reform Program.

This prompted the respondents to voluntarily offer their

landholdings for agrarian reform, proposing the selling price of P100,000.00
per hectare to the government. They later lowered their offer to P83,346.76
per hectare.

638
 On April 15, 1998, DAR issued Administrative Order No. 05-98
which provides for the formula in computing just compensation for rubber
lands under Republic Act No. 6657, taking into consideration the factors
laid down in Section 17 of Republic Act No. 6657.
DAR endorsed the matter of land valuation to Landbank. Landbank
gave a lower counteroffer to respondents, ranging from P26,412.61 to
P66,118.06 per hectare.

Respondents refused to accept Landbank's counteroffer. In view of

the deadlock on the purchase price, administrative cases for land valuation
were filed by respondents against Landbank and DAR. 20 These cases were
endorsed to the Provincial Agrarian Reform Adjudicator of Isabela, Basilan
Province for summary administrative proceedings.

In the summary administrative proceedings, Landbank recomputed

the value of the lands based on the factors provided by the latest guidelines
on land valuation. The total land value, however, posted a net decrease
from P3,196,757.54 to only P2,943,797.26. Respondents rejected the new
valuation for being "too low and unreasonable."

However, in its decision, the Provincial Agrarian Reform

Adjudication Board adopted Landbank and DAR's revaluation, stating that
this was done in accordance with the relevant administrative issuances on
land valuations.

On November 25, 1999, respondents filed separate complaints for

judicial determination and payment of just compensation before the
Regional Trial Court sitting as Special Agrarian Court which was later then
consolidated.

On its decision, the Regional Trial Court adopted the Consolidated

Commissioner’s Report awarding to the respondents a total of Nine
Million One Hundred Thousand Seven Hundred Eleven Pesos
(Php9,100,711.00) covering the just compensation or value of the four (4)
properties of the [respondents].

639
 Landbank then filed a Petition for Review before the Court of
Appeals, seeking for the reversal of the Regional Trial Court’s decision.
Meanwhile, respondents filed a motion for execution pending appeal,
pursuant to Rule 39, Section 2 (a) of the Rules of Court.

While the petition was pending before the Court of Appeals, the
Regional Trial Court issued an Order granting the motion for execution
pending appeal. The Regional Trial Court found good reasons for granting
the motion.

However, on October 28, 2005, the Regional Trial Court found 97

Landbank liable for indirect contempt for failing to comply with the writ of
execution pending appeal. The Regional Trial Court maintained that it had
the residual authority to resolve an incident that was perfected before the
appeal was given due course.

Landbank moved for reconsideration, which the Regional Trial Court

denied stating that "there is no legal impediment to enforce the Writ of
Execution Pending Appeal and [that the] refusal by Land Bank of the
Philippines . . . to obey Court processes . . . is sanctioned by the Rules on
Contempt."

In its May 29, 2009 Decision, the Court of Appeals denied 102 Landbank's
appeal and affirmed the ruling of the Regional Trial Court

ISSUE:
Whether or not there may be execution pending appeal?

RULING:
Yes. The Court of Appeals properly upheld the Regional Trial Court's
issuance of a writ of execution pending appeal.

Under Rule 39, Section 2 (a), a judgment appealed before the Court of
Appeals may still be executed by the Regional Trial Court, provided there
are good reasons for the judgment's execution.
640
The Regional Trial Court found that respondents have been deprived of
their land since 1999. They were dispossessed of the beneficial use, fruits,
and income of their properties, which were taken from them 19 years ago
without compensation. Thus, the denial of the execution pending appeal
will infringe on their constitutional right against taking of private property
without compensation.

Moreover, the just compensation for respondents' properties is not wholly

payable in cash. Sixty-five percent (65%) of the payment is in bonds, which
will mature only after 10 years. By then, the monetary value of the
properties would no longer be the same. Denying the execution pending
appeal can also stall the payment of respondents' properties through the
filing of frivolous motions and appeals.

In their motion for execution pending appeal, respondents "indicated

[their] willingness to return any amount in the event that the just
compensation fixed by [the Regional Trial Court] is modified by the
appellate court." This addresses petitioner's sole objection against
execution pending appeal.

Thus, this Court agrees with the Regional Trial Court that "[f]or reasons of
equity, justice and fair play, [respondents] should be paid to enable them to
cope up with the loss they sustained as a result of the taking and for their
economic survival."

641
 STEAG STATE POWER, INC. (FORMERLY STATE POWER
DEVELOPMENT CORPORATION), petitioner, vs. COMMISSIONER OF
INTERNAL REVENUE, respondent.

G.R. No. 205282

January 14, 2019

LEONEN, J.

DOCTRINE:
The right to appeal before the Court of Tax Appeals, being a statutory right, can
be invoked only under the requisites provided by law. Since petitioner filed its
judicial claims way beyond the 30-day period to appeal, the Court of Tax
Appeals lost its jurisdiction over the Petitions. Jurisdiction over the subject
matter is fundamental for a court to act on a given controversy. Moreover, it
cannot be waived and is not dependent on the consent or objection or the acts or
omissions of any or both parties.

FACTS:
Steag State Power is a domestic corporation primarily engaged in
power generation and sale of electricity to the National Power Corporation
under a Build, Operate, Transfer Scheme. It is registered with the Bureau of
Internal Revenue as a value-added tax taxpayer with Tax Identification No.
004-626-938-000.

Steag State Power filed its quarterly value added tax returns from the first
to fourth quarters of 2004 and 2005 with Bureau of Internal Revenue which
are the subject returns of herein refund. The refund is on the ground of
alleged unutilized input value-added tax payments on capital goods in the
total amount of P670,950,937.97.

Due to the Commissioner of Internal Revenue's (Commissioner) inaction

on its administrative claims, Steag State Power filed a Petition for Review
on Certiorari before the Court of Tax Appeals of its tax refund on April 20,
2006 and December 27, 2006 for the returns of 2004 and 2005, respectively.

642
The Court of Tax Appeals (CTA) First Division denied the Petitions due to
insufficiency of evidence. Amongst its reasons for denial is that the appeals
for the administrative claims for refund of input taxes for January 2004 to
May 2005, or the first judicial claim, were filed late.

Steag State Power then filed its motion for reconsideration but was
dismissed by the CTA. It then appealed, but the CTA en banc affirmed the
dismissal of the case holding that the appeal was belatedly filed.

Again, Steag State Power filed a motion for reconsideration but was
denied. Hence, it filed for petition for review on certiorari before the Court
but was again denied. It then filed this present motion for reconsideration.

Petitioner insists that its claims are timely. It argues that, although the
claims were filed beyond the 120+30-day periods under Section 112 of the
National Internal Revenue Code, as amended (NIRC), they were
nonetheless filed within the two (2)-year period under Section 229 of the
same law.

It contends that the timing was in accordance with Revenue Regulation

(RR) No. 7- 95, which establishes that appeals before the Court of Tax
Appeals may be made after the 120-day period and before the lapse of the
two (2)-year period.

Petitioner avers that noncompliance with the 120+30-day periods is not a

jurisdictional defect, but only a case of a "lack of cause of action," which
may be subject to the equitable principle of waiver. Since respondent
admitted in the consolidated cases that the Petitions were filed within the
allowable period, she cannot claim otherwise.

ISSUE:
Whether or not the appeal should be dismissed for being belatedly filed?

643
RULING:

Yes. Under Sec. 112 of the NIRC, as amended provides that, “if no
action on the claim for tax credit certificate/refund has been taken by the
Commissioner of Internal Revenue after the one hundred twenty (120) day
period from the date of submission of the application with complete
documents, the taxpayer may appeal to the CTA within 30 days from the
lapse of the 120-day period.”

Moreover, the Court of Tax Appeals Charter provides a 30-day

period of appeal either from receipt of the Commissioner's adverse
decision or from the lapse of the period fixed by law for action.

The right to appeal before the Court of Tax Appeals, being a statutory
right, can be invoked only under the requisites provided by law. And
under the Court of Tax Appeals Charter, the Commissioner's inaction on a
claim for refund is considered a "denial" of the claim, which may be
appealed before the Court of Tax Appeals within 30 days from the
expiration of the period fixed by law for action.

Here, since petitioner filed its judicial claims way beyond the 30-day
period to appeal, the Court of Tax Appeals lost its jurisdiction over the
Petitions. This Court has held that "[j]urisdiction over the subject matter is
fundamental for a court to act on a given controversy." Moreover, it
"cannot be waived ... and is not dependent on the consent or objection or
the acts or omissions" of any or both parties.

A claim for unutilized input value-added tax is in the nature of a tax

exemption. Thus, strict adherence to the conditions prescribed by the law is
required of the taxpayer. Refunds need to be proven and their application
raised in the right manner as required by law. Here, noncompliance with
the
120+30-day period is fatal to the taxpayer's judicial claim.

644
 RE: COMPLAINT-AFFIDAVIT OF ELVIRA N. ENALBES,
REBECCA H. ANGELES AND ESTELITA B. OCAMPO AGAINST
FORMER CHIEF JUSTICE TERESITA J. LEONARDO-DE
CASTRO [RET.], RELATIVE TO G.R. NOS. 203063 AND

204743.

A.M. No. 18-11-09-SC

January 22, 2019

LEONEN, J.

DOCTRINE:
Courts are not unmindful of the right to speedy disposition of cases enshrined
in the Constitution. Magistrates are obliged to render justice in the swiftest
way possible to ensure that rights of litigants are protected. Nevertheless, they
should not hesitate to step back, reflect, and reevaluate their position even if
doing so means deferring the final disposition of the case. Indeed, justice does
not equate with hastily giving one's due if it is found to be prejudicial. At the
end of the day, the duty of the courts is to dispense justice in accordance with
law.

FACTS:

The Complainants is charging former Chief Justice Teresita J.

Leonardo-De Castro (Chief Justice De Castro) with gross ignorance of the
law, gross inefficiency, gross misconduct, gross dishonesty, and conduct
prejudicial to the best interest of the service.

They claim that the Mallari spouses filed before this Court a Petition
for Mandamus and Prohibition with Prayer for Temporary Restraining
Order. The said was docketed as G.R. No. 203063 and G.R. No. 204743.
Both were raffled to Chief Justice De Castro.

Complainants aver that despite the lapse of more than five (5) years,
respondent failed to decide on both Petitions of Spouses Mallari which
resulted in a violation of the spouses' constitutional right to speedy
disposition of their cases.
645
ISSUE:

Whether or not respondent, former Chief Justice Teresita J. Leonardo-De

Castro, should be held administratively liable for gross ignorance of the
law, gross inefficiency, gross misconduct, gross dishonesty, and conduct
prejudicial to the best interest of the service?

RULING:

No. Gross ignorance of the law is the failure of a magistrate to apply

"basic rules and settled jurisprudence. It connotes a blatant disregard of
clear and unambiguous provisions of law" because of bad faith, fraud,
dishonesty, or corruption."

To hold a magistrate liable for gross ignorance of the law, it is not

enough that his action was erroneous; but must be proven to be driven by
bad faith, dishonesty, or ill motive.

Herein claim is predicated on the failure to resolve the Petitions for

more than five (5) years. They insist that the neglect to promptly decide on
the Petitions resulted in the violation of the spouses' right to speedy
disposition of their cases. They rely on the constitutional provision
requiring this Court to decide on cases within 24 months from their
submission.

Complainants' arguments lack merit.

Article VIII, Section 15 of the 1987 Constitution in relation to Rule 13,

Section 1 of the Internal Rules of the Supreme Court both stated that the 24-
month period for deciding on or resolving a case is reckoned from the date
of its submission for resolution. This period does not run immediately
upon the filing of a petition before this Court, but only when the last
pleading, brief, or memorandum has been submitted.

646
 Being the court of last resort, this Court should be given an ample
amount of time to deliberate on cases pending before it. While the 24-
month period provided under the Constitution is persuasive, it does not
summarily bind this Court to the disposition of cases brought before it. It is
a mere directive to ensure this Court's prompt resolution of cases, and
should not be interpreted as an inflexible rule.

647
 TERESITA S. LAZARO, DENNIS S. LAZARO, MARIETA V. JARA,
ANTONIO P. RELOVA, GILBERTO R. MONDEZ, PABLO V. DEL
MUNDO, JR., AND ALSANEO F. LAGOS, petitioners, v. COMMISSION
ON AUDIT, REGIONAL DIRECTOR OF COA REGIONAL OFFICE NO.
IV-A, AND COA AUDIT TEAM LEADER, PROVINCE OF LAGUNA,
respondents.

EVELYN T. VILLANUEVA, PROVINCIAL ACCOUNTANT OF THE

PROVINCE OF LAGUNA, petitioner, v. COMMISSION ON
AUDIT, respondent.

G.R. No. 213323 and G.R. No. 213324

January 22, 2019

LEONEN, J.

DOCTRINE:
The exception laid down in National Center for Mental Health Management v.
Commission on Audit stating that, “administrative agencies’ exercise of
discretion on the suitability of the brand of the items procured should be
accorded respect by the Courts”, no longer applies if a subsequent statue
patently admits no exception.

FACTS:

The Regional Director of the Regional Office has created an audit

team to conduct a preliminary fact-finding audit and investigation of an
alleged irregularities in purchases of medical items.

The said audit team found that in the 2004 and 2005 procurement of
medical items: (1) no public bidding had been conducted; (2) purchase
requests had made reference to brand names; and (3) there had been
splitting of purchase requests and purchase orders.

648
 Accordingly, on December 27, 2006, the Regional Cluster Director
issued a Notice of Disallowance, holding the petitioners liable for the 2004
and 2005 procurement of medical items amounting to P118,039,493.46.

In the said Notice of Disallowance, it was disclosed that: (1) the

medical items were purchased without public bidding; and (2) reference to
brand names were made in the procurement documents to justify the resort
to exclusive distributorship, contrary to Section 18 of Republic Act No.
9184.

On May 27, 2008, the petitioners filed an Appeal which was granted
by the Regional Office in its decision dated March 19, 2010.

But in August 17, 2011, the Commission on Audit, upon automatic

review, disapproved the Regional Office March 19, 2010 Decision. It held
that the disallowance was proper, and that petitioners should be held liable
for P118,039,493.46.

On July 28, 2014, separate petitions were filed by the petitioners

which the Court resolved to consolidate. In the said petitions, petitioners
claim that there are exceptions to the prohibition against referring to brand
names under Republic Act No. 9184.

The respondent on the other hand states that Section 18 of Republic

Act No. 9184 expressly prohibits reference to brand names, without any
exception or condition.

ISSUE:

Whether or not Petitioners failed to show that the Commission on Audit

committed grave abuse of discretion in disallowing the expenditures
covered by the Notice of Disallowance?

RULING:

Yes. The Commission on Audit based its disallowance on: (1) the
purchases being accomplished without public bidding, in violation of
649
Section 10 of Republic Act No. 9184; and (2) reference to brand names
being made to invoke an exception to the competitive bidding requirement,
in violation of Section 18 of Republic Act No. 9184.

Petitioners Governor Lazaro, et al. cite National Center for Mental

Health Management v. Commission on Audit to support their claims. They
point out that this Court accorded respect to administrative agencies'
exercise of discretion whenever reference to brand names and the
consequential resort to negotiated purchases were made.

However, what petitioners Governor Lazaro, et al. fail to mention is

that National Center for Mental Health Management was decided in 1996,
before Republic Act No. 9184 was enacted in 2003. Exceptions to the
prohibition against reference to brand names in Republic Act No. 9184
could not have been laid out years before the statute's enactment.

The law is patently clear, with no exceptions: "reference to brand

names shall not be allowed." Without basis to claim that it was proper to
refer to brand names in their procurement, the claim that this case is an
exception to the requirement of competitive bidding has no leg to stand on.
Consequently, the transactions were properly disallowed.

650
HYGIENIC PACKAGING CORPORATION, petitioner, vs. NUTRI-ASIA,
INC., DOING BUSINESS UNDER THE NAME AND STYLE OF UFC
PHILIPPINES (FORMERLY NUTRI-ASIA, INC.), respondent.

G.R. No. 201302

January 23, 2019

LEONEN, J.

DOCTRINE:
The venue for the collection of sum of money case is governed by Rule 4,
Section 2 of the Rules of Court. Unless the parties enter into a written
agreement on their preferred venue before an action is instituted, the plaintiff
may commence his or her action before the trial court of the province or city
either where he or she resides, or where the defendant resides. If the party is a
corporation, its residence is the province or city where its principal place of
business is situated as recorded in its Articles of Incorporation.

FACTS:

Hygienic Packaging Corporation (Hygienic) is a domestic

corporation that manufactures, markets, and sells packaging materials such
as plastic bottles and ratchet caps.

Nutri-Asia is a domestic corporation that manufactures, sells, and

distributes food products such as banana-based and tomato-based
condiments, fish sauce, vinegar, soy sauce, and other sauces.

From 1998 to 2009, Hygienic supplied Nutri-Asia with KG Orange

Bottles and Ratchet Caps with Liners (plastic containers) for its banana
catsup products. Every transaction was covered by a Purchase Order
issued by Nutri-Asia. The Terms and Conditions on the Purchase Order
provided: “Arbitration [of] all disputes arising in connection with this
Contract shall be referred to an Arbitration Committee, in accordance with
the Philippine Arbitration Law, composed of three members: one (1)
member to be chosen by the Buyer; another member to be chosen by . the

651
Seller[;] and the third member to be chosen by the other two members. The
decision of the Arbitration Committee shall be binding upon the parties.”

On July 29, 2009, Hygienic filed a Complaint for sum of money

against
Nutri-Asia. It instituted the case before the Regional Trial Court of Manila
"pursuant to the stipulation of the parties as stated in the Sales Invoices
submitting themselves to the jurisdiction of the Courts of the City of
Manila in any legal action arising out of their transaction[.]"

In its Complaint, Hygienic alleged that based on the Purchase Orders

and Sales Invoices, Nutri-Asia agreed to pay Hygienic 30 days after every
delivery of plastic containers. However, Nutri-Asia refused to pay despite
oral and written demands from Hygienic.

In its Answer with Compulsory Counter-Claim, Nutri-Asia argued

that the case should be dismissed for these reasons:

1. Hygienic failed to comply with a condition precedent prior to its

filing of the Complaint. That under the Terms and Conditions of the
Purchase Orders, Hygienic should have first referred the matter to the
Arbitration Committee; and

2. The venue was also improperly laid since the Regional Trial Court of
Manila was not the proper venue for the institution of Hygienic's personal
action but should have been filed either before the trial courts of San Pedro,
Laguna or Pasig City, where the principal places of business of Hygienic
and Nutri-Asia are located, respectively. The venue of actions as stated in
the Sales Invoices could not bind Nutri-Asia since it did not give its express
conformity to that stipulation.

The Regional Trial Court Branch 46, Manila denied the omnibus motion
filed by Nutri-Asia holding that the venue was properly laid. It considered
the signatures of Nutri-Asia's representatives in the Sales Invoices as the
company's concurrence that any dispute would be raised before the courts
of Manila. Also, the trial court ruled that Nutri-Asia's Counter-Claim was

652
permissive in nature; thus, it could not acquire jurisdiction over the
Counter-Claim unless the filing fees were paid.

Nutri-Asia filed a Motion for Reconsideration but was denied. Hence, it

filed a petition for certiorari to the Court of Appeals.

The Court of Appeals found that "the trial courts committed grave abuse of
discretion in allowing the complaint to stand and stay in Manila." It held
that since the signature of Nutri-Asia's employee in the Sales Invoices was
only for the receipt of goods, Nutri-Asia did not agree to be bound by the
venue stipulation in the Sales Invoices. Meanwhile, Hygienic did not deny
that an arbitration clause was written on the Purchase Orders. Its
representative even "acknowledged its conformity to the purchase orders.”
Since Hygienic "availed of the advantages and benefits of the purchase
orders when it acted on them[,]" it is thus estopped from rebuffing the
arbitration clause.

The Court of Appeals held that Nutri-Asia should have submitted its
Counter- Claim to arbitration for resolution. Thus, whether the Counter
Claim was permissive or compulsory was irrelevant.

Hence, this present action.

Petitioner and respondent differ as to where their dispute should be

brought for resolution. On the one hand, petitioner contends that the venue
stipulation in the Sales Invoices should be enforced. On the other hand,
respondent asserts that the arbitration clause in the Purchase Orders
should be carried out.

ISSUE:

Whether or not the action for collection of sum of money was properly
filed?

653
RULING:
No. This Court cannot subscribe to either contention.

Parties are allowed to constitute any stipulation on the venue or

mode of dispute resolution as part of their freedom to contract under
Article 1306 of the Civil Code of the Philippines.

Here, however, the records lack any written contract of sale

containing the specific terms and conditions agreed upon by the parties.
The parties failed to provide evidence of any contract, which could have
contained stipulations on the venue of dispute resolution. Nonetheless,
petitioner and respondent both claim that the Sales Invoices and the
Purchase Orders, respectively, contained a stipulation on where to raise
issues on any conflict regarding the sale of plastic containers. Each party
also insists that the other party accepted the venue stipulation in the Sales
Invoices or the Purchase Orders when its representative signed them.

Upon examination of the Sales Invoices and the Purchase Orders, this
Court cannot consider the documents as contracts that would bind the
parties as to the venue of dispute resolution.

Petitioner and respondent may have entered into a contract of sale with
respect to petitioner's merchandise. However, the case records do not show
that they have a contract in relation to the venue of any civil action arising
from their business transaction.

Since there is no contractual stipulation that can be enforced on the

venue of dispute resolution, the venue of petitioner's personal action will
be governed by the 1997 Revised Rules of Civil Procedure.

It has been consistently held that an action for collection of sum of

money is a personal action. Taking into account that no exception can be
applied in this case, the venue, then, is "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." For a corporation, its
residence is considered "the place where its principal office is located as
stated in its Articles of Incorporation."
654
 GSIS FAMILY BANK EMPLOYEES UNION VS SEC. CESAR
VILLANUEVA
G.R. NO. 210773

JANUARY 23, 2019

LEONEN, J.

DOCTRINE:

A writ of certiorari may only be issued when the following are alleged in the
petition and proven: (1) the writ is directed against a tribunal, a board[,] or any
officer exercising judicial or quasi[-]judicial functions; (2) such tribunal, board[,]
or officer has acted without or in excess of jurisdiction, or with grave abuse of
discretion amounting to lack or excess of jurisdiction; and (3) there is no appeal or
any plain, speedy[,] and adequate remedy in the ordinary course of law.

FACTS:

On July 22, 1969, Royal Savings Bank was organized and

incorporated as a thrift bank. It began operating on February 8, 1971, with
former Cavite Representative Renato Dragon as its President and Board
Chairman. On June 28, 1984, Royal Savings Bank filed an application with
the Central Bank of the Philippines (Central Bank) for the appointment of a
conservator. On July 6, 1984, the Central Bank denied Royal Savings Bank's
application for conservatorship, prohibited it from doing business, and
placed it under receivership. Royal Savings Bank filed several complaints
against the Central Bank for grave abuse of discretion. To amicably settle
the cases, then Central Bank Governor Jose B. Fernandez, Jr. offered to
reopen and rehabilitate Royal Savings Bank if it would drop all its
complaints against the Central Bank and transfer all its shares of stock to
Commercial Bank of Manila, a wholly-owned subsidiary of the
Government Service Insurance System. On September 7, 1984, Royal
Savings Bank and Commercial Bank of Manila entered into a

655
Memorandum of Agreement to rehabilitate and infuse capital into Royal
Savings Bank. Royal Savings Bank was renamed Comsavings Bank.
Sometime in December 1987, the Government Service Insurance System
transferred its holdings from Commercial Bank of Manila to Boston Bank.
Comsavings Bank was not included in the transfer. Due to Boston Bank's
acquisition of Commercial Bank of Manila, the Government Service
Insurance System took over the control and management of Comsavings
Bank. On July 19, 1993, Comsavings Bank and the Government Service
Insurance System executed a Memorandum of Agreement where the latter
committed to infuse an additional capital of P2.5 billion into Comsavings
Bank. After the infusion of funds, the Government Service Insurance
System effectively owned 99.55% of Comsavings Bank's outstanding shares
of stock. Sometime in July 2001, Comsavings Bank changed its name to
GSIS Family Bank. On May 25, 2004,10 acting on a request for opinion from
GSIS Family Bank, the General Counsel of Bangko Sentral ng Pilipinas
opined that GSIS Family Bank could not be categorized as a government
bank. On September 8, 2010, then President Benigno S. Aquino III
(President Aquino) issued Executive Order No. 7,12 which placed an
indefinite moratorium on increases in salaries and benefits of employees in
government-owned or controlled corporations and government financial
institutions. On May 2, 2012, Emmanuel L. Benitez (Benitez), GSIS Family
Bank's president, sought opinion from the Bangko Sentral ng Pilipinas as to
whether GSIS Family Bank may be considered as a government-owned or
controlled corporation or government bank under Republic Act No. 10149.
On May 14, 2012, Bangko Sentral ng Pilipinas advised GSIS Family Bank to
seek the opinion of the Governance Commission, the implementing agency
of Republic Act No. 10149. GSIS Union alleged that Republic Act No. 10149
does not apply to GSIS Family Bank, as it was a private bank created and
established under the Corporation Code.27 It asserted that even if the
Government Service Insurance System owned a majority of GSIS Family
Bank's outstanding capital stock, the change in ownership of shares did not
automatically place the bank under the operation of Republic Act No.

656
10149. GSIS Family Bank's refusal to negotiate a new collective bargaining
agreement, the GSIS Union filed a Complaint before the National
Conciliation and Mediation Board, and later, a Notice of Strike. Some bank
employees also filed their own Complaints before the National Labor
Relations Commission and the Department of Labor and Employment.
They aimed to compel GSIS Family Bank to abide by the provisions of their
existing Collective Bargaining Agreement. On January 30, 2014, petitioner
GSIS Union filed before this Court a Petition for Certiorari, asserting that
GSIS Family Bank is a private bank; thus, it is not covered by the
provisions of Republic Act No. 10149.

ISSUES:

Whether or not the Petition for Certiorari is the correct remedy.

RULING:

Petitioner claims that in filing its Petition for Certiorari under Rule 65, it
has "no plain, speedy and adequate remedy in the ordinary course of law
which will promptly and immediately relieve them from the injurious
effects of the unconstitutional and patently unwarranted and illegal acts of
the Respondents. Petitioner is mistaken. Rule 65, Section 1 of the Rules of
Civil Procedure reads:

SECTION 1. Petition for Certiorari. — 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

657
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 third paragraph of Section 3, Rule 46.

Thus, a writ of certiorari may only be issued when the following are
alleged in the petition and proven: (1) the writ is directed against a
tribunal, a board[,] or any officer exercising judicial or quasi[-]judicial
functions; (2) such tribunal, board[,] or officer has acted without or in
excess of jurisdiction, or with grave abuse of discretion amounting to lack
or excess of jurisdiction; and (3) there is no appeal or any plain, speedy,
and adequate remedy in the ordinary course of law.

658
 POLO PLANTATION AGRARIAN REFORM MULTIPURPOSE
COOPERATIVE (POPARMUCO), REPRESENTED BY SILANDO
GOMEZ AND ELIAS RAMOS, PETITIONER, v. RODOLFO T. INSON,
CESO III, AS REGIONAL DIRECTOR OF THE DEPARTMENT OF
AGRARIAN REFORM, REGION VII - CEBU CITY, RESPONDENT.

G.R. No. 189162

January 30, 2019

LEONEN, J.:

DOCTRINE:

In the exercise of its quasi-judicial function, the Department of Agrarian Reform,

through its adjudication arm— the Adjudication Board and its regional and
provincial adjudication boards— adopted the 2003 DARAB Rules of Procedure.
Under Rule II, Section 2, the Adjudication Board shall have exclusive appellate
jurisdiction to review, reverse, modify, alter, or affirm resolutions, orders, and
decisions of its Adjudicators

FACTS:

Sometime in 2003, a 394.9020-hectare portion of the landholding

owned by Polo Coconut Plantation, Inc. (Polo Coconut) in Polo, Tanjay,
Negros Oriental was placed under the coverage of the Comprehensive
Agrarian Reform Program, pursuant to Republic Act No. 6657 or the
Comprehensive Agrarian Reform Law. A Notice of Coverage was sent on
May 23, 2003 to Polo Coconut President Rene Espina (Espina). On
December 11, 2003, the Department of Agrarian Reform received from the
Land Bank of the Philippines a Memorandum of Valuation, indicating the
amount of P85,491,784.60 as just compensation for 393.1327 hectares6 of
Polo Coconut property. A Notice of Land Valuation and Acquisition was
then sent to Polo Coconut. On January 16, 2004, a Certificate of Deposit was
issued to Polo Coconut for the said amount. After Polo Coconut failed to
reply to the Notice of Land Valuation and Acquisition, the Department of
Agrarian Reform conducted summary administrative proceedings to
659
determine just compensation. In his March 31, 2004 Resolution, Regional
Adjudicator Atty. Arnold C. Arrieta (Regional Adjudicator Arrieta) of the
Department of Agrarian Reform Adjudication Board (the Adjudication
Board), Region VII, Cebu City affirmed the valuation offered by Land Bank
of the Philippines in the amount of P85,491,784.60. The Provincial Agrarian
Reform Officer of Negros Oriental, Stephen Leonidas, sent Espina a letter
dated July 16, 2004, informing him of the Department of Agrarian Reform's
intention to proceed with the relocation survey of the property. Polo
Coconut moved for the suspension of the survey, but Regional Adjudicator
Arrieta denied the Motion for lack of jurisdiction. Polo Coconut filed before
the Court of Appeals a Petition for Certiorari questioning the propriety of
subjecting its property to the Comprehensive Agrarian Reform Program. It
contended that the City of Tanjay had already reclassified the area into a
mixed residential, commercial, and industrial land. It also assailed the
eligibility of the identified agrarian reform beneficiaries.

Petitioner prayed that a restraining order or writ of preliminary injunction

be issued, directing respondent to cease: (1) from enforcing the Cease and
Desist Order in light of the Petition; and (2) from reviewing the
beneficiaries, as this Court had decided with finality on the issue. It further
prayed that this Court hold respondent guilty of contempt of court.

ISSUE:

Whether or not respondent Regional Director Rodolfo T. Inson's

cognizance of the Petition for Inclusion/Exclusion of farmer beneficiaries,
and his subsequent issuance of the July 7, 2009 Cease and Desist Order and
the March 12, 2010 Order disqualifying some of petitioner's members,
constitute defiance of this Court's September 3, 2008 Decision.

RULING:

This Court dismisses the Petition. The validity of the July 7, 2009 Cease and
Desist Order and the correctness of the March 12, 2010 Order will not be

660
discussed in this Petition for Contempt. They should instead be tackled in a
more appropriate mode and forum. Petitioner had appealed the Order
partially granting the Petition for Inclusion/Exclusion and the July 14, 2010
Order denying their Motion for Reconsideration. In an April 3, 2013 Order,
the Department of Agrarian Reform Secretary dismissed the appeal for lack
of merit. In the exercise of its quasi-judicial function, the Department of
Agrarian Reform, through its adjudication arm, the Adjudication Board
and its regional and provincial adjudication boards, adopted the 2003
DARAB Rules of Procedure. Under Rule II, Section 2, the Adjudication
Board shall have exclusive appellate jurisdiction to review, reverse, modify,
alter, or affirm resolutions, orders, and decisions of its Adjudicators who
have primary and exclusive original jurisdiction over the following cases:

Rule II
Jurisdiction of the Board and its Adjudicators

SECTION 1. Primary and Exclusive Original Jurisdiction. — The

Adjudicator shall have primary and exclusive original jurisdiction to
determine and adjudicate the following cases:

1.1 The rights and obligations of persons, whether natural or juridical,

engaged in the management, cultivation, and use of all agricultural
lands covered by Republic Act (RA) No. 6657, otherwise known as the
Comprehensive Agrarian Reform Law (CARL), and other related
agrarian laws;
1.2 The preliminary administrative determination of reasonable and just
compensation of lands acquired under Presidential Decree (PD) No. 27
and the Comprehensive Agrarian Reform Program (CARP);
1.3 The annulment or cancellation of lease contracts or deeds of sale or
their amendments involving lands under the administration and
disposition of the DAR or Land Bank of the Philippines (LBP);
1.4 Those cases involving the ejectment and dispossession of tenants
and/or leaseholders;
1.5 Those cases involving the sale, alienation, pre-emption, and
redemption of agricultural lands under the coverage of the CARL or

661
 other agrarian laws;
1.6 Those involving the correction, partition, cancellation, secondary and
subsequent issuances of Certificates of Land Ownership Award (CLOAs) and
Emancipation Patents (EPs) which are registered with the Land Registration
Authority[.]

Rule II, Section 3 further states that neither the Adjudicator nor the
Adjudication Board has jurisdiction over matters involving the
administrative implementation of the Comprehensive Agrarian Reform
Law and other agrarian laws, as they are exclusively cognizable by the
Department of Agrarian Reform Secretary.

662
 SIMEON LAPI Y MAHIPUS, PETITIONER, v. PEOPLE OF THE
PHILIPPINES

G.R. No. 210731

February 13, 2019

LEONEN, J.

DOCTRINE:
To prove guilt, courts must evaluate the evidence presented in relation to the
elements of the crime charged.Thus, the finding of guilt is essentially a question of
fact. For this reason, the entire records of a criminal case are thrown open for this
Court's review.

FACTS:
On or about the 17th day of April, 2006, in the City of Bacolod,
Philippines, and within the jurisdiction of this Honorable Court, the
herein accused conspiring, confederating and acting in concert, not
being authorized by law to smoke, consume, administer to oneself,
ingest or use a dangerous drug, did, then and there willfully,
unlawfully and feloniously engage in ingesting and introducing to
their bodies a dangerous drug known as methylamphetamine
hydrochloride or shabu and after confirmatory test on the qualitative
examination of the urine sample on the three accused, they were
found positive to the test for Methylamphetamine, a dangerous drug.
On arraignment, Lapi, Sacare, and Lim pleaded not guilty to the
crime charged. At pre-trial, Sacare and Lim changed their pleas to
guilty, and were sentenced to rehabilitation for six (6) months at a
government-recognized center. Only Lapi was subjected to trial on
the merits.

Having been arrested and their paraphernalia seized, the men were
then brought to the City Anti-Illegal Drug Special Operation Task
Group Office, where a police blotter was filed. They were later
brought to the Philippine National Police Crime Laboratory to
663
undergo drug tests.

The initial laboratory report found that Lapi, Sacare, and Lim tested
positive for methylamphetamine hydrochloride (shabu), while their
companions, Noel Canlas and Carmelo Limbaco, tested negative.
Another test conducted yielded the same results.

In his defense, Lapi alleged that on April 17, 2006, he was in Purok
Sigay, Barangay 2, Bacolod City to deliver a mahjong set to a certain
Antonio Kadunggo. On his way home, two (2) persons approached
him and searched his pocket. They took his money, handcuffed him,
and boarded him on a tricycle with four (4) other persons whom he
did not know.

Lapi stated that upon reaching the Taculing Police Headquarters, he

and the others were subjected to a drug test. They were then escorted
to their detention cell without being informed of the test results.
Rolando Cordova, a barbecue vendor in the area, corroborated Lapi's
testimony.

In its September 15, 2010 Decision, the Regional Trial Court found
Lapi guilty. It ruled that the warrantless arrest against him was legal
since he was caught in flagrante delicto. Petitioner argues that while he
raises factual questions, his case falls under the exceptions under the
Rules of Court. He claims that the Court of Appeals' factual findings
"are totally bereft of support in the records and so glaringly
erroneous as to constitute a serious abuse of discretion. Petitioner
asserts that while he failed to question the validity of his arrest before
entering his plea, his warrantless arrest was illegal from the start.
Hence, any evidence obtained cannot be used against him. He argues
that PO2 Villeran committed "a malevolent intrusion of privacy"
when he peeped through the window; had he not done so, he would
not see what the people in the house did.29 He contends that this
intrusion into his privacy "cannot be equated in plain view[;]
therefore[,] petitioner cannot be considered caught in flagrante
delicto." He submits that to "rule otherwise would be like giving
authority to every police officer to intrude into the private homes of
664
 anyone in order to catch suspended drug offenders."

ISSUE:
Whether or not the warrantless arrest against petitioner Simeon M. Lapi
was valid.

RULING:

This Court is not a trier of facts. A petition for review on certiorari under
Rule 45 of the Rules of Court must, as a general rule, only raise questions of
law. Parties may only raise issues that can be determined without having to
review or reevaluate the evidence on record. This Court generally gives
weight to the factual findings of the lower courts "because of the
opportunity enjoyed by the [lower courts] to observe the demeanor of the
witnesses on the stand and assess their testimony." In criminal cases,
however, the accused has the constitutional right to be presumed innocent
until the contrary is proven. To prove guilt, courts must evaluate the
evidence presented in relation to the elements of the crime charged.Thus,
the finding of guilt is essentially a question of fact. For this reason, the
entire records of a criminal case are thrown open for this Court's review.

665
PEOPLE OF THE PHILIPPINES, PLAINTIFF-APPELLEE, v. EDGARDO
ROYOL Y ASICO, ACCUSED-APPELLANT.

G.R. No. 224297

February 13, 2019

LEONEN, J.:

DOCTRINE:
In order that there may be conscionable non-compliance, two (2) requisites must be
satisfied: first, the prosecution must specifically allege, identify, and prove
"justifiable grounds"; second, it must establish that despite non-compliance, the
integrity and evidentiary value of the seized drugs and/or drug paraphernalia were
properly preserved. Satisfying the second requisite demands a showing of positive
steps taken to ensure such preservation. Broad justifications and sweeping
guarantees will not suffice.

FACTS:
On or about November 27, 2007 at around 10:05 o'clock in the
morning, in the Municipality of Bamban, Province of Tarlac, Philippines,
and within the jurisdiction of this Honorable Court, the above-named
accused did then and there willfully, unlawfully and criminally sell one
half sized (1/2) brick of dried marijuana fruiting tops in the amount of One
Thousand Pesos to poseur buyer PO2 Mark Anthony Baquiran PNP
weighing 500.28 grams, a dangerous drug without being authorized by
law. According to the prosecution, at around 9:00 a.m. on November 27,
2007, a confidential informant went to the Tarlac Provincial Police Office in
Camp Makabulos, Tarlac City and reported that Royol had been selling
illegal drugs in Barangay Lourdes, Bamban, Tarlac. The informant
allegedly told PO2 Baquiran that he was due to meet Royol that morning.
A buy-bust team was formed. Members of the buy-bust team rushed to
arrest Royol. Royol testified in his defense. He recalled that in the morning
of November 27, 2007, while collecting garbage, two (2) men approached
him asking if he knew a certain Edgardo Saguisag (Saguisag). They left him
after he said that he did not know the man. A few minutes later, the men
666
returned with two (2) teenagers who pointed to him as Saguisag. The men
then ordered him to raise his hands. He was handcuffed and made to lie
face on the floor. He asked the men why they handcuffed him, but they did
not reply. Instead, they searched his pockets, found P140.00, and took it.
They then compelled him to board a red car and brought him to
Makabulos. He was also shown marijuana and asked if it was his, to which
he answered in the negative. In its five (5)-page Decision dated December
13, 2010, the Regional Trial Court found Royol guilty as charged.

ISSUE:
Whether or not prosecution is justified in the non-compliance of the
procedure of chain of custody requirements.

RULING:
Section 21(1) of the Comprehensive Dangerous Drugs Act allows for
deviations from its requirements under "justifiable grounds." The
prosecution, however, never bothered to account for any such justifiable
ground.

In People v. Lim, this Court definitively recognized the prosecution's burden

to allege and substantiate justifiable grounds for deviating from the chain
of custody requirements:
Judicial notice is taken of the fact that arrests and seizures related to illegal
drugs are typically made without a warrant; hence, subject to inquest
proceedings. Relative thereto, Section 1 (A. 1.10) of the Chain of Custody
Implementing Rules and Regulations directs:
A. 1.10. Any justification or explanation in cases of noncompliance with the
requirements of Section 21 (1) of R.A. No. 9165, as amended, shall be
clearly stated in the sworn statements/affidavits of the
apprehending/seizing officers, as well as the steps taken to preserve the
integrity and evidentiary value of the seized/confiscated items.
Certification or record of coordination for operating units other than the
PDEA pursuant to Section 86 (a) and (b), Article IX of the IRR of R.A. No.
9165 shall be presented.

667
While the above-quoted provision has been the rule, it appears that it has
not been practiced in most cases elevated before Us. Thus, in order to weed
out early on from the courts' already congested docket any orchestrated or
poorly built up drug-related cases, the following should henceforth be
enforced as a mandatory policy:

1. In the sworn statements/affidavits, the apprehending/seizing

officers must state their compliance with the requirements of Section 21 (1)
of R.A. No. 9165, as amended, and its IRR.

2. In case of non-observance of the provision, the apprehending/seizing

officers must state the justification or explanation therefor as well as the
steps they have taken in order to preserve the integrity and evidentiary
value of the seized/confiscated items.

3. If there is no justification or explanation expressly declared in the

sworn statements or affidavits, the investigating fiscal must not
immediately file the case before the court. Instead, he or she must refer the
case for further preliminary investigation in order to determine the (non)
existence of probable cause.

4. If the investigating fiscal filed the case despite such absence, the court
may exercise its discretion to either refuse to issue a commitment order (or
warrant of arrest) or dismiss the case outright for lack of probable cause in
accordance with Section 5, Rule 112, Rules of Court.37 (Citations omitted)

Lim's listing of requirements is consistent with Que, which explained that:

In order that there may be conscionable non-compliance, two (2) requisites
must be satisfied: first, the prosecution must specifically allege, identify,
and prove "justifiable grounds"; second, it must establish that despite non-
compliance, the integrity and evidentiary value of the seized drugs and/or
drug paraphernalia were properly preserved. Satisfying the second
requisite demands a showing of positive steps taken to ensure such
preservation. Broad justifications and sweeping guarantees will not suffice.
It is understandably impracticable, even unreasonable, to retroactively
insist here on compliance with the specific directives in Lim, which merely
serves to concretize Section 21(l)'s longstanding requirements. Yet, whether
by Lim's contemporary standard or by Section 21(1)'s bare textual
668
articulation, the prosecution miserably failed to justify noncompliance with
the chain of custody requirements under the Comprehensive Dangerous
Drugs Act.

669
 METRO BOTTLED WATER CORPORATION, PETITIONER, v.
ANDRADA CONSTRUCTION & DEVELOPMENT CORPORATION,
INC., RESPONDENT.

G.R. No. 202430

March 06, 2019

LEONEN, J.:

DOCTRINE:

Generally, judicial review of arbitral awards is permitted only on very narrow

grounds. Republic Act No. 876, or the Arbitration Law, does not allow an arbitral
award to be revisited without a showing of specified conditions, which must be
proven affirmatively by the party seeking its review. The Special Rules of Court on
Alternative Dispute Resolution, implementing the Alternative Dispute Resolution
Act of 2004, mandate that arbitral awards will not be vacated "merely on the
ground that the arbitral tribunal committed errors of fact, or of law, or of fact and
law, as the court cannot substitute its judgment for that of the arbitral tribunal."
Parties are even "precluded from filing an appeal or a petition for certiorari
questioning the merits of an arbitral award." On the other hand, arbitral awards
by the Construction Industry Arbitration Commission may only be appealed on
pure questions of law,6 though not all will justify an appeal. Consistent with the
strict standards for judicial review of arbitral awards, only those appeals which
involve egregious errors of law may be entertained.

FACTS:

On April 28, 1995, Metro Bottled Water and Andrada Construction

entered into a Construction Agreement for the construction of a reinforced
concrete manufacturing plant in Gateway Business Park, General Trias,
Cavite for the contract price of P45,570,237.90. The Construction
Agreement covered all materials, labor, equipment, and tools, including
any other works required. The project was to be completed within 150
calendar days or by October 10, 1995, to be reckoned from Andrada
Construction's posting of a Performance Bond to answer for liquidated

670
damages, costs to complete the project, and third party claims. The
Performance Bond was issued by Intra Strata Assurance Corporation (Intra
Strata). On May 2, 1996, Metro Bottled Water filed a claim against the
Performance Bond issued by Intra Strata.17 Andrada Construction opposed
the claim for lack of legal and factual basis. On September 6, 1996, Andrada
Construction wrote to Metro Bottled Water contesting E.S. De Castro and
Associates' Special Report.19 The works performed by Andrada
Construction were inspected by Metro Bottled Water and E.S. De Castro
and Associates. Punch lists were prepared to monitor Andrada
Construction's rectifications. The Court of Appeals found no error in the
entitlement of legal interest since demand could be reasonably established
from Andrada Construction's October 24, 2000 Letter, which stated that
payment was being requested as a formal claim. It held that it could not
pass upon Metro Bottled Water's allegation that the claims were barred by
laches since it was not among the issues for resolution in the parties' Terms
of Reference. Metro Bottled Water filed a Motion for Reconsideration, but it
was denied by the Court of Appeals in its June 25, 2012 Resolution. Hence,
this Petition was filed. Petitioner argues that the Court of Appeals erred in
applying the principle of unjust enrichment, considering that Article 1724
of the Civil Code43 provides the requisites for the recovery of the costs of
additional work. It contends that Article 1724 requires both the written
authority of the owner allowing the changes and a written agreement by
the parties as to the increase in costs, neither of which were present in this
case.44 Even the Construction Agreement, it asserts, requires a written
order to the contractor signed by the owner, authorizing work changes or
adjustments on the contract price or contract period—to which respondent
did not comply. Petitioner explains that there was no evidence to conclude
that it did not observe the contractual provisions on Change Order Nos. 1
to 38 since respondent admitted that Change Order Nos. 1 to 38 were
submitted to petitioner for approval. At any rate, it argues, the
Construction Agreement provides that any non-enforcement under the
contract cannot be construed as a waiver of its rights. Hence, its non-
enforcement of the contractual provisions on Change Order Nos. 1 to 38
should not be construed as a waiver of its rights to enforce the contractual
provisions on Change Order Nos. 39 to 109.

671
ISSUE:

Whether or not the Arbitration Commission is authorized.

RULING:

Yes. The Construction Industry Arbitration Commission was created by

Executive Order No. 1008, or the Construction Industry Arbitration Law, to
have "original and exclusive jurisdiction over disputes arising from, or
connected with, contracts entered into by parties involved in construction
in the Philippines, whether the dispute arises before or after the completion
of the contract, or after the abandonment or breach thereof." The extent of
its jurisdiction is clearly provided for in the law:The jurisdiction of the
CIAC may include but is not limited to violation of specifications for
materials and workmanship; violation of the terms of agreement;
interpretation and/or application of contractual time and delays;
maintenance and defects; payment, default of employer or contractor and
changes in contract cost. Excluded from the coverage of this law are
disputes arising from employer-employee relationships which shall
continue to be covered by the Labor Code of the Philippines. Petitioner has
neither alleged that the arbitral tribunal arrived at its findings "in a
haphazard, immodest manner"109 nor questioned the integrity of the
arbitrators. Absent any proof to the contrary, this Court will not disturb its
factual findings.

Here, the arbitral tribunal computed the entire cost of Change Order Nos. 1
to 109 at P5,242,697.76.117 This includes that of Change Order Nos. 1 to 38,
which petitioner categorically admitted were authorized changes. Upon
subtracting the contract price and other costs chargeable to respondent, the
arbitral tribunal found that there was still an unpaid amount of
P4,607,523.40,118 resulting from the costs of the change orders, which
petitioner refuses to pay. There was, therefore, no error in the arbitral
tribunal's finding and the Court of Appeals' affirmation that petitioner is
still liable to respondent for that amount. The Petition is denied.

672
Maria Shiela Hubahib vs. The Office of the Deputy Ombudsman for the
Visayas; Atty. Fernando Abella, Regster of Deeds; and Macrina Espiña

G.R. Nos. 212491-92

March 6, 2019,

J. Leonen

DOCTRINE:
Probable cause for the filing of an information is "a matter which rests on
likelihood rather than on certainty. It relies on common sense rather than on clear
and convincing evidence.

FACTS:
In its assailed Consolidated Evaluation Report, the Office of the Atty.
Abella, Registrar of Deeds of Catarman, Northern Samar, and Macrina,
Complainant Tupaz stated that her mother, Sol Espina Hubahib (Hubahib),
was the registered owner of a 100,691-square meter property in Barangay
Rawis, Lao-ang, Northern Samar. Since its issuance in 1971, a duplicate has
always been in the possession of their family-initially by Hubahib and,
upon her demise, by her heirs. Atty. Abella canceled Original Certificate of
Title No. 15609 and, in its stead, issued Transfer Certificate of Title Nos.
116-2011000073 and 116-2011000074 in favor of Genaro, represented by his
attorney-in-fact, Macrina

Tupaz maintained that Atty. Abella: (1) issued a spurious owner's

duplicate copy of Original Certificate of Title No. 15609; 14 (2) tolerated the
use of an equally spurious Certificate Authorizing Registration and Deed
of Conveyance;15 and (3) enabled the issuance of specious transfer
certificates of titles, with Genaro as beneficiary. Hence, she filed her
Complaint, asserting that Atty. Abella, along with Macrina, were liable for
falsification, graft and corrupt practices, misconduct, dishonesty, and
conduct prejudicial to the best interest of the service. The Complaint was
dismissed for being premature. Thus, Tupaz filed this Petition for

673
Certiorari specifically assailing the ruling of the Office of the Deputy
Ombudsman for the Visayas on the criminal aspect of her Complaint.

ISSUES:

Whether or not the Deputy Ombudsman for the Visayas acted with
grave abuse of discretion amounting to lack or excess of jurisdiction in not
finding probable cause to charge private respondent Atty. Abella, along
with private respondent Macrina, with violation of Section 3( e) of the Anti-
Graft and Corrupt Practices Act.

RULING:

YES. The Court held that the determination of probable cause is an

executive, not a judicial, function. It is generally not for a court to disturb
the conclusion made by a public prosecutor. This is grounded on the basic
principle of separation of powers. However, grave abuse of discretion
taints a public prosecutor's resolution if he [or she] arbitrarily disregards
the jurisprudential parameters of probable cause. In such cases, consistent
with the principle of checks and balances among the three (3) branches of
government, a writ of certiorari may be issued to undo the prosecutor's
iniquitous determination. Public prosecutors are not bound to adhere to a
party's apparent determination of the specific crime for which a person
shall stand trial. Their discretion includes the right to determine under
which laws prosecution will be pursued. When, however, there is an
unmistakable showing of grave abuse of discretion on the part of the
prosecutor in declining to prosecute specific persons for specific offenses, a
writ of certiorari may be issued to set aside the prosecutor's initial
determination. Determining probable cause must be made in reference to
the elements of the crime charged. This is based on the principle that every
crime is defined by its elements, without which there should be, at the
most, no criminal offense.

Private respondent Abella's official acts of cancelling Original Certificate of

Title No. 15609, and issuing in its stead Transfer Certificate of Title Nos.

674
116-2011000073 and 116-201100007 4 in the name of Genaro, appear to be
attended, at the very least, by gross inexcusable negligence. Here, the
evidence strongly suggests that private respondent Abella's actions, like
Espenesin's, fell miserably short of the standards apropos to his office.
While he did not act with private respondent Macrina out of a shared
malevolent design, he nonetheless relied on manifestly defective and
tellingly suspicious documents that private respondent Macrina presented.

675
 People of the Philippines vs. Lina Achieng Noah,

G.R. No. 228880

March 6, 2019

J. Leonen

DOCTRINE:
Compliance with the chain of custody requirements under Section 21 ensures the
integrity of the seized items. In contrast, noncompliance tarnishes the credibility of
the corpus delicti, on which prosecutions under the Comprehensive Dangerous
Drugs Act are based.

FACTS:
An Information was filed charging Noah with violation of Article II,
Section 5 of Republic Act No. 9165. Noah pleaded not guilty to the crime
charged. Customs Examiner Landicho testified that at around 5:23 p.m. on
February 24, 2012 at the Ninoy Aquino International Airport Terminal 1,
defendant Noah, a Kenyan national who arrived from Kenya via Dubai,
approached Lane Number Five ( 5) of the Customs Arrival Area. He asked
her to present her passport and Baggage Declaration. In Noah's presence,
Special Agent I Noble and Landicho inspected the luggage and found
hidden compartments. Inside were compressed foil packs containing white
crystalline substance. Upon testing samples using Marquis Reagent No. 2,
the white crystalline substance yielded positive for methamphetamine
hydrochloride or shabu. Special Agent I Noble added that before Noah's
arrest, he asked her if she could understand English. When she said yes, he
apprised her of her Miranda rights.

In her defense, Noah denied transporting the illegal drugs, claiming that
she went to the Philippines for a job opportunity. She added that the
luggage was only given to her while she was in her recruiter's office. She
allegedly met an unidentified man who, while discussing her travel details,
also offered the black trolley bag after commenting that her bag was soiled.

676
RTC found Noah guilty beyond reasonable doubt of the crime charged. It
held that the warrantless search and arrest of Noah was "lawful, valid, and
effective”. CA affirmed the RTC decision.

ISSUE:

Whether or not accused-appellant Noah's guilt for violation of

Section 5 of the Comprehensive Dangerous Drugs Act was proven beyond
reasonable doubt

RULING:

Yes. The essential element for the crime of illegal transportation of

dangerous drugs is the movement of the dangerous drug from one place
to another. To establish the accused's guilt, it must be proven that: (1) the
transportation of illegal drugs was committed; and (2) the prohibited drug
exists. Proof of ownership of the dangerous drugs seized is immaterial.
What is important is that the prosecution prove the act of transporting as
well as the identity and integrity of the seized drugs. This is because the
confiscated drug is the corpus delicti of the crime. Since it is not readily
identifiable by sight or touch and may be easily tampered with, its
preservation is paramount.

The chain of custody ensures that there would be no unnecessary

doubts concerning the identity of the evidence. When the identity of corpus
delicti is compromised by noncompliance with Section 21, critical elements
of the offense of illegal transportation of dangerous drugs are not proven.
This warrants an accused's acquittal. Here, the prosecution proved beyond
reasonable doubt that accused-appellant was indeed transporting the
illegal drugs. Although she had initially denied ownership of the luggage
and illegal drugs found, accused-appellant's claim is disputed by the
evidence on record. The chain of custody was also established by the
prosecution.

677
Police Superintendent Hansel M. Marantan vs. Department of Justice, et.
al.,

G.R. No. 206353

March 13, 2019

J. Leonen

DOCTRINE:
The relevant issues in determining whether grave abuse of discretion attended the
preliminary investigation are: (l) whether petitioner had been so fundamentally
deprived of an opportunity to be heard in relation to the purposes of preliminary
investigation; (2) whether the infirmities were so fatal that they effectively deprived
petitioner of any opportunity to be heard during the judicial examination, pre-trial,
and trial; and (3) whether there would be a public policy interest in suspending the
criminal action.

FACTS:
A shootout occurred in Atimonan, Quezon between the combined
forces of the PNP and the AFP’s First Special Forces Battalion. Then
President Aquino III ordered the National Bureau of Investigation to
investigate what was called the Atimonan Encounter. While the
investigation was ongoing, and before all the involved police and armed
forces personnel filed their affidavits recounting the incident, then
Department of Justice Secretary Leila De Lima made public
pronouncements on the Atimonan Encounter, reportedly mentioning
Marantan's name. Marantan filed a Motion before the Department of
Justice for request for inhibition, which was subsequently denied.
Marantan filed this Petition. Two (2) days later, he filed an Urgent
Manifestation, after he had filed the Petition, the Panel had conducted the
preliminary investigation. He alleged that during the preliminary
investigation, the Panel furnished him copies of the attachments to the
Subpoena earlier served upon them. The Panel found probable cause to
charge petitioner.

Respondents argue that the Petition should be dismissed outright as

petitioner disregarded the hierarchy of courts and failed to exhaust all

678
administrative remedies. They point out that his claims of prejudgment are
highly speculative considering that there is no showing that the Panel had
prejudged the case or that respondent Department of Justice Secretary De
Lima had exerted any pressure on the Panel to rule a certain way. They
maintain that jurisdiction over the preliminary investigation lies with
respondent Department of Justice, not the Office of the Ombudsman.
Lastly, as to petitioner's prayer for injunctive relief, respondents point out
that a writ of preliminary injunction is not issued when the act sought to
be enjoined has already been consummated; in this case, with the issuance
of the Omnibus Resolution.

ISSUE:
Whether or not respondent Department of Justice committed grave abuse
of discretion in denying petitioner Marantan's letter-request for inhibition

RULING:

NO. Petitioner has failed to show that respondent Department of

Justice committed grave abuse of discretion in finding probable cause
against him. This Court agrees that respondent Secretary De Lima's
conduct before the Information was filed in court could have been better.
However, petitioner failed to show that she had any ulterior motives or
bias against him. Her statements did not appear to be based on a prejudice
against petitioner, but were simply reactions to an ongoing investigation
that had developed as the investigation proceeded. Besides, respondent
Department of Justice Secretary De Lima's conduct is relevant here only
insofar as it affected the preliminary investigation.

The process of preliminary investigation is essentially one (I )-sided,

as it serves only to assist the prosecution to summarily decide whether
there was sufficient basis to: (1) charge a person with an offense; and (2)
prevent a harassment suit that both prejudices a respondent and wastes
government resources. During the preliminary investigation, the
prosecution only needs to determine whether it has prima facie evidence to
sustain the filing of the information. Here, petitioner failed to show any
basis to find that the Omnibus Resolution, which found probable cause to
charge him with murder, was erroneous. He broadly claims that the Panel
679
was not an impartial tribunal and, because their superior had already
prejudged petitioner to be guilty, they had no choice but to arrive at the
same conclusion and tailor their resolution fit to find probable cause
against petitioner. However, aside from failing to establish respondent
Department of Justice Secretary De Lima's bias against him, petitioner also
failed to show that the Panel's conclusion was wrong, much less tainted
with grave abuse of discretion. The Panel's conclusions appear to have
been well-reasoned and evidence-based.

680
 Augusto Regalado y Laylay vs. People of the Philippines,

G.R. No. 216632

March 13, 2019

J. Leonen

DOCTRINE:
For the conviction of illegal possession of dangerous drugs, the following elements
must be established: ( 1) the accused was in possession of an item or an object
identified to be a prohibited or regulated drug, (2) such possession is not
authorized by law, and (3) the accused was freely and consciously aware of being
in possession of the drug.

FACTS:

According to the prosecution, a team of five (5) police officers

conducted a buy-bust operation. At around 2:00 p.m. that day, POI
Pedrigal went to Regalado's house while the rest of the team stayed about
200 meters behind him. There, PO 1 Pedrigal asked Regalado's wife,
Marilyn, "Meron kayo ngayon, bibili ako?" Marilyn informed him that her
husband was not in the house and that she would ask her daughter to fetch
him. When Regalado arrived, he immediately inquired where PO Pedrigal
came from, to which he replied that he was from Marlangga. Regalado
then asked POI Pedrigal the quantity he sought to buy, to which the latter
replied that he wanted two (2). Regalado went into his house, returning
with a plastic sachet suspected to contain marijuana. Regalado took the
money and put it in his pocket. At this point, PO1 Pedrigal scratched his
head-the pre-arranged signal signifying to the team that the transaction
had been consummated. The team rushed to Regalado's house and
identified themselves as police officers. They arrested Regalado after PO1
Pedrigal retrieved the marked money from his pocket. Regalado denied
handing the marijuana to PO1 Pedri gal and maintained that the latter took
it from the teenager. He claimed that he signed the confiscation receipt
despite not understanding it as he did not know how to read. He likewise
testified that he was not informed of his constitutional rights.

681
 RTC found Regalado guilty of violating Article II, Section 11 of
Republic Act No. 9165 in Criminal Case No. 08-03. However, it acquitted
him in Criminal Case No. 09-03, ruling that one cannot be convicted twice
for the same act. CA affirmed RTC decision.

ISSUE:

Whether or not the absence of an elective official, a representative

from the media, and a representative from the Department of Justice
during the buy-bust operation, as well as the non-presentation of the
photographs of the seized marijuana before the trial court warrants
petitioner Augusto L. Regalado's acquittal

RULING:

NO. The allegations in both Informations, despite the buy-bust

operation, charged petitioner with illegal possession of dangerous drugs,
not sale. Hence, the trial court correctly acquitted him in Criminal Case No.
09-03, where the Information was worded exactly as that in Criminal Case
No. 08-03, which charged him with illegal possession of dangerous drugs.
Moreover, although the actual weight of the seized items was not indicated
in the Informations, this error was not fatal. Here, the testimonies of the
law enforcers who conducted the buy-bust operation are clear and
categorical. They recalled in detail the buy-bust operation and the steps
they had taken to maintain the integrity of the seized marijuana.
Ultimately, petitioner's free and conscious possession of the dangerous
drug has been established, warranting his conviction. However, this Court
laments the prosecution's apparent nonchalance in observing the
procedure for the custody and disposition of confiscated, seized, and/or
surrendered drugs and/or drug paraphernalia under Section 21 of the
Comprehensive Dangerous Drugs Act, as amended by Republic Act No.
10640.

682
 Here, none of the three (3) people required by Section 21 (1) was
present during the physical inventory of the seized items. Moreover, this
Court has held that the prosecution has "the positive duty to establish that
earnest efforts were employed in contacting the representatives or that
there was a justifiable ground for failing to do so Yet, not only did the
prosecution fail to establish that earnest efforts were employed in securing
the presence of the three (3) witnesses; it did not even bother to offer any
justification for the law enforcers' deviation from the law's requirements.
Since preliminaries do not appear on record, this Court cannot speculate
why the law enforcers neglected the simple rules in the conduct of a buy-
bust operation.

683
 People of the Philippines vs. Lahmodin Ameril y Abdul @
“Amor/Mhong”,

G.R. No. 222192

March 13, 2019

J. Leonen

DOCTRINE:
The seized illegal drugs constitute the corpus delicti of the illegal sale of dangerous
drugs. Its identity must be proved beyond reasonable doubt.69 When there is doubt
on its identity, conviction cannot be sustained.

FACTS:

In an Information dated April 24, 2006 Ameril was charged with

violation of Article II, Section 5 of Republic Act No. 9165. Special
Investigator Fernandez testified that on April 10, 2006, a confidential
informant came to the NBI Reaction Arrest Division. The informant told
the Division Chief Lasala, that one (1) alias "Amor," later identified as
Ameril, was selling prohibited drugs in Metro Manila. Chief Lasala then
instructed Special Investigator Fernandez to confirm the information. The
buy-bust operation team went to Solanie Hotel. Then, Ameril arrived at the
hotel, where the informant introduced him to Special Investigator
Fernandez. After a few minutes of conversation, Ameril asked Special
Investigator Fernandez if he had the money, to which Special Investigator
Fernandez replied that Ameril should first show the shabu. Ameril showed
him a black paper bag, inside of which were three (3) small transparent
plastic sachets containing white crystalline substance. Convinced that the
sachets contained shabu, Special Investigator Fernandez gave the boodle
money to Ameril. As soon as Ameril gave the paper bag to Special
Investigator Fernandez, the latter made the pre-arranged signal. Ameril
denied the allegations against him. RTC convicted Ameril. It ruled that the
prosecution had successfully established his guilt by presenting sufficient

684
evidence that showed the elements of illegal sale of dangerous drugs. CA
affirmed Ameril's conviction.
ISSUE:
Whether or not accused-appellant should be held liable for violation
of Article II, Section 5 of Republic Act No. 9165, or the Comprehensive
Dangerous Drugs Act of 2002

RULING:
NO. In sustaining a conviction for illegal sale of dangerous drugs,
the following elements must first be established: (1) proof that the
transaction or sale took place; and (2) the presentation in court of the
corpus delicti or the illicit drug as evidence. The illegal drug itself
constitutes the corpus delicti of the offense. Its existence must be proved
beyond reasonable doubt. Proof beyond reasonable doubt demands that
unwavering exactitude be observed in establishing the corpus delicti. The
chain of custody rule performs this function as it ensures that unnecessary
doubts concerning the identity of the evidence are removed. Failing to
comply with Article II, Section 21, Paragraph 1 of Republic Act No. 9165
implies a concomitant failure on the part of the prosecution to establish the
identity of the corpus delicti, and produces doubts as to the origins of the
seized illegal drugs.

The Information filed against accused-appellant provided that he was

caught selling three (3) transparent plastic sachets containing white
crystalline substance known as shabu, marked "LAA," ''LAA-2," and
"LAA." However, the evidence presented during trial showed that accused-
appellant sold three (3) plastic sachets with the markings "LLA-1," "LLA-2,"
and “LLA." Nonetheless, the RTC brushed aside this discrepancy and still
convicted the accused-appellant. Contrary to the RTC's findings, the
integrity of the seized illegal drugs was not preserved. Here, here is a
discrepancy in the markings of the illegal drugs seized from accused-
appellant. This raises doubts if the items presented in court were the exact
ones taken from accused-appellant.

The totality of the evidence presented shows that the arresting

officers who conducted the buy-bust operation were remiss in the
performance of their official functions. They made discrepancies in the
685
markings of the seized illegal drugs, and failed to comply with the chain of
custody. Consequently, the presumption of regularity in favor of arresting
officers is negated.

686
 Ha Datu Tawahig (Roderick D. Sumatra), Petitioner, v. The Honorable,
Cebu City Prosecutor II Fernando Gubalane, Assistant City Prosecutor
Ernesto Narido, Jr., Cebu City Prosecutor Nicolas Sellon, And The
Honorable Judge of the Regional Trial Court Branch 12, Cebu City Estela
Alma Singco, Respondents.
G.R. No. 221139
March 20, 2019
Leonen J.

DOCTRINE:

The Philippine legal system's framework for the protection of indigenous peoples
was never intended and will not operate to deprive courts of jurisdiction over
criminal offenses. Individuals belonging to indigenous cultural communities who
are charged with criminal offenses cannot invoke Republic Act No. 8371, or the
Indigenous Peoples' Rights Act of 1997, to evade prosecution and liability under
courts of law.

FACTS:
Sumatra was charged for the rape of a certain Igot. Sumatra argued
that the courts have no jurisdiction over his case as provided by the
Indigenous Peoples’ Rights Act wherein disputes between indigenous
cultural communities must apply the tribal justice system and that they are
under the jurisdiction of the National Commission on Indigenous Peoples.

ISSUE:

WON the court has jurisdiction over the case of Sumatra.

687
RULING:

No. The Indigenous Peoples' Rights Act does not compel courts of law to
desist from taking cognizance of criminal cases involving indigenous
peoples. It expresses no correlative rights and duties in support of
petitioner's cause. Thus, a writ of mandamus cannot be issued.

A crime is "an offense against society." It "is a breach of the security and
peace of the people at large”

The capacity to prosecute and punish crimes is an attribute of the State's

police power. It inheres in "the sovereign power instinctively charged by
the common will of the members of society to look after, guard and defend
the interests of the community, the individual and social rights and the
liberties of every citizen and the guaranty of the exercise of his rights."

The basic precepts underlying crimes and criminal actions make it

improper for the State to yield "disputes" involving criminal offenses to
indigenous peoples' customary laws and practices.

To yield criminal prosecution would be to disregard the State and the

Filipino people as the objects of criminal offenses. The application of
customary laws may enable a measure of reparation for private injuries
engendered by criminal offenses, but it will never enable the consummate
recompense owed to the State and the Filipino people. Ultimately then,
yielding prosecution would mean sanctioning a miscarriage of justice.

688
 Larry Sabuco Manibog, Petitioner v People of the Philippines,
Respondents.

G.R. 211214

March 20,2019

Leonen, J.

DOCTRINE:

For a “stop and frisk” search to be valid, the totality of suspicious circumstances,
as personally observed by the arresting officer must lead to a genuine reason to
suspect that a person is committing an illicit act.

FACTS:

On March 17, 2010, Manibog was charged with violation of Section 1

of Commission on Elections Resolution No. 8714, in relation to Section 32
of R.A. 7166 and Sections 261 and 264 of B.P. 881. The police received
information from a police asset that Manibog was standing outside the
Tourism Office of Dingras with a gun tucked in his waistband. A team was
organized to verify the information. As the officers moved closer, they saw
a buldge on his waist. Chief inspector patted the gun and confirmed that it
was a gun. He was arrested and his firearm was seized for not having a
permit from the Commission on Elections to carry it.

Petitioner claims that he was not arrested in flagrante delicto because

he was only standing in front of the Municipal Office when the police
officers descended upon and searched him. He also argued that the police
officers could not have seen the gun as it was tucked below his navel and
could not be seen from a distance.

689
ISSUE:

WON there was an illegal search and seizure attending the

apprehension and confiscation of Manibog’s gun.

RULING:

No. There was a valid stop and frisk search. Chief Inspector Beniat
received information that petitioner, was carrying a gun during an election
ban. The police officer deduced the bulge to be a gun based on the size and
contour.

To sustain the validity of a stop and frisk search, the arresting officer
should have personally observed two or more suspicious circumstances,
the totality of which would create a reasonable inference of criminal
activity to compel the arresting officer to investigate further.

The tip on petitioner, coupled with the police officers’ visual

confirmation that petitioner had a gun-shaped object tucked in his
waistband, led to a reasonable suspicion that he was carrying a gun during
an election gun ban.

690
 JAKA Investments Corporation, Petitioner, v. Urdaneta Village
Association, Inc. and Ayala Land, Inc., Respondents.

G.R. Nos. 204187 and 206606

April 01, 2019

Leonen, J.

DOCTRINE:

Cases involving intra-association controversies fall under the jurisdiction of the

Housing and Land Use Regulatory Board, the government agency with the
technical expertise on the matter.

FACTS:

Jaka Investments bought three (3) lots in Urdaneta Village, which

were covered by Transfer Certificate of Title Nos. S-10603, S-10604, and S-
74957.

On March 15, 2007, the Association's Board of Governors held a meeting,

where it approved the extension of the Association's corporate life and the
term of the Deed Restrictions, both for another 25 years:

On September 6, 2007, the Association held a general membership meeting

to vote on the changes. Of its 331 members, 267 approved the corporate life
extension while 257 approved the Deed Restrictions' term extension. Jaka
Investments, represented through proxy Estela Malabanan, voted in favor
of both extensions.

On April 8, 2008, the Housing and Land Use Regulatory Board issued a
certificate of the Association's amended Articles of Incorporation.

On July 30, 2008, Jaka Investments filed before the Regional Trial Court a
Petition for the cancellation of restrictions annotated in Transfer Certificate
of Titles

691
ISSUE:

WON the Regional Trial Court has jurisdiction over the case

RULING:

The instant controversy falls squarely within the exclusive and original
jurisdiction of the Home Insurance and Guaranty Corporation (HIGC),
now HLURB. Pursuant to Executive Order No. 535, the HIGC assumed the
regulatory and adjudicative functions of the SEC over homeowners'
associations.

To determine if this case falls under the agency's jurisdiction, it is necessary

to examine whether the controversy arose "from any of the following intra-
corporate relations: (1) between and among members of the association; (2)
between any and/or all of them and the association of which they are
members; and (3) between the association and the state insofar as the
controversy concerns its right to exist as a corporate entity.

692
ATTY. BERNARDO T. CONSTANTINO, PETITIONER, v. PEOPLE OF
THE PHILIPPINES, RESPONDENT.

G.R. No. 225696

April 08, 2019

Leonen, J.

DOCTRINE:

For a notary public to be found guilty of falsifying a notarial will, the prosecution
must prove that he or she has falsified or simulated the signatures of the testator or
the instrumental witnesses to make it appear that they participated in the
execution of the document when they did not.

FACTS:

Sometime in June 1998, Severino, suffered a stroke and was rushed to

the hospital. When he was discharged, he returned to the family home in
Laoag City. There, Saliganan stayed and took care of Severino until his
death on December 6, 2003.

On February 8, 2005, a Petition for Probate of Severino's alleged Last Will

and Testament was filed before the Regional Trial Court of Laoag City.

Upon learning of the probate proceedings, Fernando, a son of Severino,

secured a copy of the purported Last Will and Testament. He claimed that
the signature in the document was not Severino's. The document was
notarized by Atty. Constantino and registered in Book No. 31, Page No. 71
of Atty. Constantino's Notarial Register, series of 2001. The witnesses who
signed it were Rosalinda Cu, the Balintona Spouses, and Dr. Eliezer John
Asuncion.

On May 27, 2008, an Information was filed against Atty. Constantino

and Teresita C. Saliganan, charging them with falsification of a public
document.

693
ISSUE:

WON the Petition presents questions of fact not cognizable in a

petition for review on certiorari under Rule 45 of the Rules of Court.

RULING:

No. The Constitution guarantees that an accused is presumed

innocent until the contrary is proven. Thus, every conviction requires no
less than proof beyond reasonable doubt. The burden of proof rests with
the prosecution. Guilt must be founded on the strength of the prosecution's
evidence, not on the weakness of the defense.

Appeals of criminal cases confer upon the reviewing court full jurisdiction
and render it competent to examine the records, revise the judgment from
which an appeal arose, increase the penalty, and cite the appropriate penal
law provision.

The Court may still review the factual findings of the trial court "if it is not
convinced that such findings are conformable to the evidence of record and
to its own impressions of the credibility of the witnesses." Significant facts
and circumstances may have been overlooked, which, if properly
considered, could affect the result of the case.

694
PEOPLE OF THE PHILIPPINES, PLAINTIFF-APPELLEE, v. DIOSCORO
COMOSO TUREMUTSA, ACCUSED-APPELLANT.

G.R. No. 227497

April 10, 2019

Leonen, J.

DOCTRINE:

Failure to comply with the chain of custody requirements in drugs cases will result
in an accused's acquittal.

FACTS:

In a March 27, 2005 Information, Comoso was charged with violation

of the Comprehensive Dangerous Drugs Act, particularly for the illegal
sale of dangerous drugs.

On March 26, 2005, the Anti-Drug Special Operation Task Force and Drug
Enforcement Action Division planned a buy-bust operation after receiving
information from their civilian asset that a certain "Coro" was selling illegal
drugs in Quimson, Barangay Bagong Sikat, Puerto Princesa City.

At around 2:30 p.m., police officers proceeded to the area of the operation.
They parked their motorcycle and walked about 50 meters to the target
area, where the asset told them to wait. Soon after, Comoso arrived. There,
he handed a plastic sachet supposedly containing marijuana in exchange
for the asset's buy-bust money. The asset, in turn, removed his hat—the
pre-arranged signal that the transaction had been consummated.

Upon seeing the pre-arranged signal, the officers rushed to the scene and
arrested Comoso and the asset. PO2 Aquino recovered the plastic sachet
from the asset, while PO3 Fernandez frisked Comoso and recovered the

695
buy-bust money, one used marijuana stick, and a lighter. PO2 Aquino then
marked both the plastic sachet and the buy-bust money with his initials
"FJA."

As they reached the police station, PO2 Aquino also marked the used
marijuana stick and lighter. He then prepared an Inventory of Confiscated
Items.

About two weeks after the buy-bust operation, Superintendent De Villa, a

forensic chemist at the Philippine National Police Regional Crime
Laboratory Office, MIMAROPA, received the samples of seized items and a
letter-request for laboratory examination.

Comoso, solely testified in his defense. He alleged that in the afternoon of

March 26, 2005, on his way home from delivering his catch, he was grabbed
and frisked by two armed men, whom he figured were police officers. They
first brought Comoso to the airport, then to the police station, where he
would be detained.

ISSUE:

WON failure to comply with the chain of custody requirement in

drug cases will result in the acussed’s acquittal.

RULING:

Yes. The prosecution presented evidence that Superintendent De

Villa, the forensic chemist, only received the seized items on April 8,
2005, or 10 working days after the buy-bust operation on March 26, 2005.
This is obviously beyond the 24-hour period required by law, a delay for
which the prosecution has not been able to explain.

696
Nothing in the records shows that the witnesses required to be present and
sign the inventory—an elected public official and a representative of the
National Prosecution Service or the media—were present, even though this
was a pre-planned entrapment operation. Moreover, the prosecution did
not justify the law enforcement officers' noncompliance with the chain of
custody.

Reasonable doubt arises in the prosecution's narrative when the links in the
chain of custody cannot be properly established. There is no guarantee that
the evidence had not been tampered with, substituted, or altered.

697
 Michael C. Guy vs. Raffy Tulfo

Gr no. 213023

April 10, 2019

Leonen, J.:

DOCTRINE:

Rule 45 settled is the rule that only questions of law may be raised only in a
petition for certiorari. “This court is not a trier of facts and it is not its duty to
review, evaluate and weigh the probative value of the evidence adduced before the
lower courts.” Absent “any clear showing that the trial court overlooked or
misconstrued cogent facts and circumstances that would justify altering or
revising such findings and evaluation,” this court will not disturb, let alone
overturn the lower court’s findings of fact and appreciation of the witnesses’
testimonies.

FACTS:

On March 24, 2004, an article entitled “Malinis ba talaga o naglilinis-

linisan lang (sino si Finance Sec. Juanita Amatong?) was published in
Abante Tonite, a newspaper of general circulation in the Philippines.

Written by Raffy Tulfo, the article reported that a certain Michael C.

guy, who was then being investigated by the Revenue Integrity Protection
Service of the Department of Finance for tax fraud, went to former
Deoartment of Finance Secretary Juanita Amatong then purportedly called
the head of The revenue Integrity Protection Service and directed that all
the documents that the Revenue Integrity Protection Service had obtained
on Guy’s case be surrendered to her.

Claiming that the article had tainted his reputation, guy filed before
the office of the City Prosecutor of Makati City a complaint affidavit

698
against Tulfo and following representatives of Abante Tonite’s publisher.
Amended information was filed charging tulfo with the crime of Libel.

ISSUE:

Whether or not Mr. guy is entitled to moral damages

RULING:

No.

This court ruled that the court of appeals, correctly found that
petitioner failed to substantiate the loss he had allegedly sustained. Save
for his testimony in court, he presented no evidence to support his claim.
His allegation of possibly earning 5000000.00in 10 years is a mere
assumption without any foundation. This bare allegation is insufficient to
prove that he has indeed lost 5,000,000.00 as earnings. The award of
unrealized profits cannot be based on the sole testimony of party claiming
it.

Unfortunately, petitioner failed to prove that he has suffered any

pecuniary loss. While he testified that he lost clients as a result of the
libelous article, records reveal that he lost only one client, Jayson Mallari.

699
 People of the Philippines Vs ZZZ

G.R. No. 229862

June 19, 2019

Leonen, J.:

DOCTRINE:

Affidavits of desistance are viewed with scepticism and reservation because they
can be easily “obtained for monetary consideration or through intimidation.”

FACTS:

AAA Narrated that in the afternoon of April 12, 2006, she had fallen
asleep after doing laundry, while her stepfather, ZZZ, was doing carpentry
works. Suddenly, she woke up and found ZZZ on top of her, his lower
body naked. He then sat on the floor with his penis showing and removed
her short pants and underwear, after which he went back on top of her and
masturbated. He took AAA’s hands and put them on his penis, telling her
that if she became pregnant, “he would be happy.” ZZZ then inserted his
penis into her vagina and sat, kissed her face, touched her vagina, and
kissed her breast.”

Information was filed charging ZZZ with the crime of rape.

ISSUE:

Whether or not zzz is guilt of the crime rape

RULING:

Yes.

700
 Affidavits of desistance are viewed with scepticism and reservation
because they can be easily “obtained for monetary consideration or
through intimidation.” Based on the circumstances here, this court cannot
give any weight to AAA’s affidavit of Recantation and desistance. If the
crime really not committed AAA would have made the affidavit at the
earliest instance-but she did not. Instead, she executed it more than two
years after the crime had been committed. If the did not really happen, she
would not have submitted herself to physical examination or hours of
questioning-but she did.

More over, her recollection on how the accused-appellan committed

the crime was detailed; her testimony, consistent. There was no evidence
that AAA was forced or pressured by the prosecutor to take the witness
stand.

701
 Ricardo Verino y Pingol

v.

People of the Philippines

Gr no. 225710

June 19, 2019

Leonen J.;

DOCTRINE:

The law’s implementing Rules and regulations introduced a saving clause, which
was eventually incorporated in section 21 when the law was amended by Republic
Acr No. 10640. “provided, finally, that noncompliance of these requirements under
justifiable grounds, as long as the integrity and the evidentiary value of the seized
items are properly preserved by the apprehending officer/tem, shall not render void
and invalid such seizures and custody over said items.”

FACTS:

Around 5:00 p.m on April 4, 2014, PO! Verde of the Station Anti-
illegal drugs of the Valenzuela Police Station received a phone call tagging
Verino as a dangerous drugs seller in Marulas Public Market, Valenzuela
City. The informant also described Verino’s hair and mustache. They
formed a group to conduct a buy-bust operation.

At around 9:00 pm, the team went to Marulas Public Market and
proceed with their operation. Around an hour later, the police officers saw
Verino come out a store and meet a man, with whom he showed a plastic
sachet. The officers slowly walked toward them, but the unidentified man
saw them and shouted, “Mga pulis!” before running away.

702
 PO1 Verde managed to grab Verino and seized two plastic sachets
from his hand and another sachet from his pocket. The seized items were
turned over to SPO3 Sanchez. The Trial court convicted Verino guilty
beyond reasonable doubt for illegal possession of dangerous drug act. The
Court of appeals affirmed the Lower Court’s decision.

ISSUE:

Whether or not the prosecution proved the guilt of the accused

despite there’s a failure to comply with Article 11, section 21 of the
Comprehensive Dangerous Drugs Act.

RULING:

No.

When it comes to section 21, this Court has repeatedly stated that the
handling officers must observe strict compliance to guarantee the integrity
and identity of seized drug. Thus, acts that “appropriate compliance but do
not strictly comply with Section 21 have been considered insufficient.”

Nonetheless, while strict compliance is the expected standard, the

Comprehensive Dangerous Drugs Act recognized that it may not always
be possible in every situation. Hence, the law’s implementing Rules and
regulations introduced a saving clause, which was eventually incorporated
in section 21 when the law was amended by Republic Acr No. 10640.
“provided, finally, that noncompliance of these requirements under
justifiable grounds, as long as the integrity and the evidentiary value of the
seized items are properly preserved by the apprehending officer/tem, shall
not render void and invalid such seizures and custody over said items.”

Here, an inventory of the items seized from the petitioner was

prepared by SPO3 Sanchez. However despite the clear and requirements
703
under section 21, the inventory was only witnessed by an elected public
official. The prosecution failed to explain why the inventory was not signed
by petitioner or his representative and a representative of the National
Prosecution Service or the media, as mandated by the law.

704
 Reynaldo Santiago, Jr. y Santos v. People of The Philippines

G.R. No. 213760

July 1, 2019

Leonen, J.:

DOCTRINE:

“The trial court is in the best position to assess the credibility of witnesses and
their testimonies because of its unique opportunity to observe the witnesses, their
demeanour, conduct and attitude on the witness stand.” The exception is when
either or both lower courts have “overlooked or misconstrued substantial facts
which could have effected the outcome of the case.”

FACTS:

On September 26 and 27, 2011, TV 5 segment producer Espenida and

his crew went to Plaza Morga and Plaza Mariones in Tondo, Manila to
investigate the alleged prostitution operations in the area. They had earlier
designed a confidential asset, alias “Romeo David” on whom a lapel
microphone was clipped, to pose as a customer and transact with the
alleged pimps for a night with a minor. During the transaction, the pimps
allegedly asked for 500.00.

At around 11:00 p.m., the team and David arrived at Plaza Morga.
After surveying the area, David pointed to the pimps, who, upon seeing
the police, ran away but were eventually caught and arrested.

After the arrest, the team proceeded to the hotel where the trafficked
person, AAA, had been waiting. The officers took her into custody and
brought her to the Regional Intelligence Division at Camp Bagong diwa.

705
ISSUE:

Whether or not petitioner Reynaldo Santiago , Jr is guilty of

violating Section 4(a) of the anti-trafficking in Person Act.

RULING:

Yes.

This court accords great respect to the trial court’s findings,

especially when affirmed by the court of appeals. “The trial court is in the
best position to assess the credibility of witnesses and their testimonies
because of its unique opportunity to observe the witnesses, their
demeanour, conduct and attitude on the witness stand.” The exception is
when either or both lower courts have “overlooked or misconstrued
substantial facts which could have effected the outcome of the case.”
Contrary to petitioner’s contention, the testimony of the confidential
informant is not indispensable in the crime of trafficking in persons.
Neither is his identity relevant. “it is sufficient that the accused has lured,
enticed or engaged its victims or transported them for established purpose
of exploitation which was sufficiently shown by the trafficked person’s
testimony alone.

The information sufficiently averred that: (1) petitioner committed an act

of qualified trafficking in persons by offering AAA to David for sex or
exploitation; (2) the act was done for a fee; and (3) for prostitution, sexual
exploitation, forced labor, slavery, involuntary servitude or debt bondage.
The rule is settled that what controls is not the designation of the offense
but its description in the complaint or information.

Hence, this court affirm the conviction of petitioner for violation of

R.A no. 9208, section 4 (a), as punished under section 10(a).

706
GENEVIEVE ROSAL ARREZA, A.K.A. “GENEVIEVE ARREZA TOYO”
VS. TETSUSHI TOYO, LOCAL CIVIL REGISTRAR OF QUEZON CITY
AND THE ADMINISTRATOR AND CIVIL REGISTRAR GENERAL OF
THE NATIONAL STATISTICS OFFICE
G.R. No. 213198.

July 1, 2019

Leonen J.

DOCTRINE:

Philippine courts do not take judicial notice of foreign judgments and laws. They
must be proven as fact under our rules on evidence.

FACTS:
On April 1, 1991, Genevieve, a Filipino citizen, and Tetsushi Toyo
(Tetsushi), a Japanese citizen, were married in Quezon City. They bore a
child whom they named Keiichi Toyo. After 19 years of marriage, the two
filed a Notification of Divorce by Agreement, which the Mayor of
Konohana-ku, Osaka City, Japan received on February 4, 2011. It was later
recorded in Tetsushi's family register as certified by the Mayor of
Toyonaka City, Osaka Fu

On May 24, 2012, Genevieve filed before the Regional Trial Court a Petition
for judicial recognition of foreign divorce and declaration of capacity to
remarry. In support of her Petition, Genevieve submitted a copy of their
Divorce Certificate, Tetsushi's Family Register, the Certificate of
Acceptance of the Notification of Divorce, and an English translation of the
Civil Code of Japan, among others. After finding the Petition sufficient in
form and substance, the Regional Trial Court set the case for hearing on
October 16, 2012. On the day of the hearing, no one appeared to oppose the
Petition. After the jurisdictional requirements were established and
marked, trial on the merits ensued.

707
On February 14, 2014, the Regional Trial Court rendered a Judgment
denying Genevieve's Petition. It decreed that while the pieces of evidence
presented by Genevieve proved that their divorce agreement was accepted
by the local government of Japan, she nevertheless failed to prove the copy
of Japan's law. The Regional Trial Court noted that the copy of the Civil
Code of Japan and its English translation submitted by Genevieve were not
duly authenticated by the Philippine Consul in Japan, the Japanese Consul
in Manila, or the Department of Foreign Affairs. Aggrieved, Genevieve
filed a Motion for Reconsideration, but it was denied in the Regional Trial
Court's June 11, 2014 Resolution.

Thus, Genevieve filed before this Court the present Petition for Review on
Certiorari. Petitioner argues that the trial court erred in not treating the
English translation of the Civil Code of Japan as an official publication in
accordance with Rule 131, Section 3(gg) of the Rules of Court. That it is an
official publication, she points out, makes it a self-authenticating evidence
of Japan's law under Rule 132, Section 25 of the Rules of Court. Petitioner
further contends that the trial court erred in not considering the English
translation of the Japan Civil Code as a learned treatise and in refusing to
take judicial notice of its authors' credentials.

ISSUE:

WON the Regional Trial Court erred in denying the petition for judicial
recognition of foreign divorce and declaration of capacity to remarry filed
by petitioner Genevieve Rosal Arreza a.k.a. Genevieve Arreza Toyo.

RULING:

Philippine courts do not take judicial notice of foreign judgments and laws.
They must be proven as fact under our rules on evidence. A divorce decree
obtained abroad is deemed a foreign judgment, hence the indispensable

708
need to have it pleaded and proved before its legal effects may be extended
to the Filipino spouse.

Both the foreign divorce decree and the foreign spouse's national law,
purported to be official acts of a sovereign authority, can be established by
complying with the mandate of Rule 132, Sections 2445 and 2546 of the
Rules of Court:

Under Sections 24 and 25 of Rule 132, on the other hand, a writing or

document may be proven as a public or official record of a foreign country
by either (1) an official publication or (2) a copy thereof attested by the
officer having legal custody of the document. If the record is not kept in the
Philippines, such copy must be (a) accompanied by a certificate issued by
the proper diplomatic or consular officer in the Philippine foreign service
stationed in the foreign country in which the record is kept and
(b)authenticated by the seal of his office. (Citations omitted) Here, the
Regional Trial Court ruled that the documents petitioner submitted to
prove the divorce decree have complied with the demands of Rule 132,
Sections 24 and 25. However, it found the copy of the Japan Civil Code and
its English translation insufficient to prove Japan's law on divorce. It noted
that these documents were not duly authenticated by the Philippine
Consul in Japan, the Japanese Consul in Manila, or the Department of
Foreign Affairs.

Finally, settled is the rule that, generally, this Court only entertains
questions of law in a Rule 45 petition. Questions of fact, like the existence
of Japan's law on divorce, are not within this Court's ambit to resolve.

WHEREFORE, in the interest of orderly procedure and substantial justice,

the case is hereby REFERRED to the Court of Appeals for appropriate
action, including the reception of evidence, to DETERMINE and RESOLVE
the pertinent factual issues in accordance with this Decision

709
 Geralino M. Lim and The People of the Philippines Vs. Edwin M. Lim
G.R. No. 214163.

July 1, 2019

Leonen J.
DOCTRINE:
Settled is the rule that "the remedies of appeal and certiorari are mutually
exclusive and not alternative or successive." When the remedy of appeal is
available to a litigant, a petition for certiorari shall not been entertained and should
be dismissed for being an improper remedy.

FACTS:

Ronald Geralino M. Lim (Ronald) filed before the Office of the City
Prosecutor a Complaint for grave threats against his brother Edwin M.
Lim(Edwin). Acting favorably on the Complaint, the Office of the City
Prosecutor filed an Information against Edwin before the Municipal Trial
Court in Cities, Branch 5, Iloilo City.

That on or about November 11, 2012, in the City of Iloilo, Philippines and
within the jurisdiction of this Honorable Court, said accused, with
deliberate intent and without any justifiable motive, did then and there
willfully, unlawfully and feloniously threaten to kill Ronald Geralino Lim,
by uttering threatening words, to wit, "Pus-on ko ulo mo!"and "Patyon ta
ikaw" (I will smash your head!" ... , (sic) I will kill you)having persisted in
said threats.

CONTRARY TO LAW. On arraignment, Edwin pleaded not guilty to the

crime charged.
The case was then referred to the Philippine rv1ediation Center for
mediation. But due to the parties' failure to reach a settlement, the case was
referred back to the court.

710
On January 29, 2014, Edwin filed before the Regional Trial Court a Petition
for Certiorari and Prohibition with prayer for the issuance of a temporary
restraining order and/or writ of preliminary injunction. He contended that
the Municipal Trial Court in Cities committed grave abuse of discretion
when it allowed the belated filing of the Judicial Affidavits. In its
Comment, the prosecution argued that the Regional Trial Court did not
acquire jurisdiction over them since no summons had been served upon
Ronald and the Office of the Solicitor General. In addition, they contended
that a resort to a petition for certiorari was improper since the remedy of
appeal was still available to them.

ISSUES:

1. WON the Regional Trial Court acquired jurisdiction over petitioners

Ronald Geralino M. Lim and People of the Philippines;

2. WON the Petition for Certiorari and Prohibition was the proper
remedy to question the November 21, 2013 Order of the Municipal Trial
Court in Cities; and

3. WON the Municipal Trial Court in Cities committed grave abuse of

discretion in allowing the belated submission of the Judicial Affidavits.
Petitioners' arguments lack merit.

RULING:

Petitioners mainly argue that since no summons had been served upon
them, the Regional Trial Court failed to acquire jurisdiction over them. As a
result, they insist that the Regional Trial Court's June 6, 2014 Decision is
void. Contrary to petitioners' postulation, summons need not be issued in a
petition for certiorari under Rule 65 of the Rules of Court.

Under the Rules of Court, there are two (2) types of civil actions:
(1)ordinary civil actions; and (2) special civil actions. Both are governed by

711
the rules for ordinary civil actions. However, special civil actions, such as
petitions for certiorari, are further subject to certain specific rules. Rule 65,
Section 6 of the Rules of Court states that the court, upon the filing of a
petition for certiorari, shall determine if it is sufficient in form and
substance. Once it finds the petition to be sufficient, it shall issue an order
requiring the respondents to comment on the petition. This Court shall
discuss the second and third issues simultaneously as they are interrelated
with each other. Settled is the rule that "the remedies of appeal and
certiorari are mutually exclusive and not alternative or successive." When
the remedy of appeal is available to a litigant, a petition for certiorari shall
not been entertained and should be dismissed for being an improper
remedy.

Under the Rules of Court, an appeal is a remedy directed against a"

judgment or final order that completely disposes of the case, or of a
particular matter therein when declared by these Rules to be appealable." It
cannot be availed of against an interlocutory order. In contrast, a petition
for certiorari is a remedy directed not only to correct errors of jurisdiction,
"but also to set right, undo[,] and restrain any act of grave abuse of
discretion amounting to lack or excess of jurisdiction by any branch or
instrumentality of the Government. Here, the Municipal Trial Court in
Cities allowed the prosecution's belated submission of their Judicial
Affidavits despite the repeated postponements of the scheduled pre-trial.
To recall, the pre-trial was reset thrice: from August 12, 2013 to September
5, 2013, then to October 17,2013, and finally, to November 21, 2013. In spite
of that, the prosecution failed to submit their Judicial Affidavits within the
time prescribed by the Rule. Its excuse-"for whatever reason"-cannot be
considered sufficient to allow the belated submission of the Judicial
Affidavits. WHEREFORE, the Petition is DENIED.

712
 PEOPLE OF THE PHILIPPINES VS. JORDAN CASACLANG DELA
CRUZ
G.R. No. 229053.

July 17, 2019

Leonen J.
DOCTRINE:

In a criminal case, the prosecution must discharge the burden of proving the
accused's guilt beyond reasonable doubt to secure a conviction for the crime
charged. Proof beyond reasonable doubt does not require absolute certainty that
excludes error. Rather, this standard requires moral certainty, "or that degree of
proof which produces conviction in an unprejudiced mind." Beyond being fleshed
out by procedural rules, the requirement of proof beyond reasonable doubt occupies
a constitutional stature, as it finds basis not only in the due process clause of the
Constitution, but also in the accused's presumption of innocence under the Bill of
Rights. The right to be presumed innocent puts the burden on the prosecution to
prove guilt above the reasonable doubt standard.

FACTS:

On July 23, 2012, two (2) Informations were filed before the Regional
Trial Court, charging Dela Cruz for violation of Republic Act No.
9165,Article II, Sections 5 and 11, for the illegal sale and illegal possession
of dangerous dn1gs, respectively.

The Informations read: Criminal Case No. L-9497For Violation of Article II,
Section 11"That on or about July 10, 2012 in the afternoon at Artacho
St.,Poblacion, Lingayen, Pangasinan, and within the jurisdiction of this
Honorable Court, the above-named accused, did, then and there, willfully
and unlawfully have in his possession, control and custody two (2) plastic
sachets of dried Marijuana leaves, a dangerous drug, with a total weight
of2.8 grams, without any necessary permit/license or authority to possess
the same.

713
CONTRARY TO LAW." Criminal Case No. L-9498For Violation of Article
II, Section 5"That on or about July 10, 2012 at Artacho St., Poblacion,
Lingayen, Pangasinan, and within the jurisdiction of this Honorable Court,
the above-named accused, did, then and there, willfully and unlawfully,
sell two (2) plastic sachets of dried Marijuana leaves with a total weight
of2.8 grams, to POI Denver Y. Santillan, an undercover policeman who
acted as a poseur-buyer in a buy bust operation conducted against him,
which were tested and yielded positive to be that of marijuana, a
dangerous drug, without any authority to sell the same.

PO 1 Santillan testified that he possessed the confiscated items from the

time he took them from Dela Cruz until he eventually turned them over to
the Philippine National Police Crime Laboratory for testing. After
conducting a laboratory examination, Senior Inspector Malojo Todefio
confirmed in her July 10, 2012 Chemistry Report No. D-073-12 that the
confiscated items were indeed marijuana. The four (4) specimens, which
she marked "Al ' " "A2'" "A3 ' " and "A4' " respectively weighed 1. 3 grams
'1.5 grams, 1.4 grams, and 1.4 grams. She testified that she turned them
over to the evidence custodian, PO2 Manuel, who corroborated this on
trial.

In his defense, Dela Cruz disclaimed any knowledge of the illegal sale and
possession of drugs. He testified that on July 10, 2012, he attended his7 :30
a.m. to 11 :45 a.m. classes at the Pangasinan National High School. By
lunch break, he went with his friends to a nearby canteen, where three (3)
unidentified men in civilian clothes approached and invited him to the
municipal hall. When he said he did not do anything wrong, they assured
him that they would only talk to him, and eventually asked about the
pending theft case against him. When he again told them that he did
nothing wrong, one ( 1) of the men pointed a gun at him and coerced him
intoboarding an STX motorcycle. 18Dela Cruz further alleged that they
brought him to the police station,where he was interrogated and accused of
stealing "spaghetti," a slang forcutting wires. On cross-examination, he

714
revealed that the men who accostedhim were not the police officers who
testified against him.

ISSUE:

WON the Regional Trial Court gravely erred in finding him guilty despite
the police officers' failure to comply with Section 21 of the Comprehensive
Dangerous Drugs Act

RULING:
In a criminal case, the prosecution must discharge the burden of proving
the accused's guilt beyond reasonable doubt to secure a conviction for the
crime charged. Proof beyond reasonable doubt does not require absolute
certainty that excludes error. Rather, this standard requires moral certainty,
"or that degree of proof which produces conviction in an unprejudiced
mind." Beyond being fleshed out by procedural rules, the requirement of
proof beyond reasonable doubt occupies a constitutional stature, as it finds
basis not only in the due process clause of the Constitution, but also in the
accused's presumption of innocence under the Bill of Rights. The right to be
presumed innocent puts the burden on the prosecution to prove guilt
above the reasonable doubt standard.

Whenever there is an unjustified noncompliance with the chain of custody

requirements, the prosecution cannot invoke the presumption of regularity
in the performance of official duty to conveniently disregard such lapse.
Noncompliance obliterates proof of guilt beyond reasonable doubt,
warranting an accused's acquittal. Thus, the constitutional right to
presumption of innocence prevails. WHEREFORE, the Court of Appeals'
October 5, 2016 Decision in CA-G.R. CR H.C. No. 07660 is REVERSED and
SET ASIDE. Accused appellant Jordan Casaclang Dela Cruz is
ACQUITTED for the prosecution's failure to prove his guilt beyond

715
reasonable doubt. He is ordered immediately RELEASED from detention,
unless he is confined for ()some other lawful cause.

716
 PEOPLE OF THE PHILIPPINES VS. GAJIR ACUB Y ARAKANI A.K.A.
“ASAW”

G.R. No. 220456.

June 10, 2019

Leonen J.
DOCTRINE:
To sustain a conviction for the illegal sale of dangerous drugs, it must be proven
that a transaction took place and the corpus delicti or the illicit drug must be
presented into evidence. Although not easily identifiable, the identity of the illicit
drug must be clearly established since its very existence is essential to convict an
accused. This Court has repeatedly emphasized that strict compliance is the
expected standard when it comes to the custody and disposition of seized illegal
drugs, to prevent tampering and planting of evidence

FACTS:
State agents must strictly comply with the legal safeguards
established in Section 21 of Republic Act No. 9165, as amended, for the
custody and disposition of seized illegal drugs, to ensure that the evidence
was not tampered with, substituted, or planted. For the saving clause in
Section 21 to apply, the prosecution must prove beyond reasonable doubt
that noncompliance was justified and that the integrity and evidentiary
value of the seized item were preserved.

In an Information dated February 11, 2005, Acub was charged with selling
a dangerous drug to an undercover police officer during a buy-bust
operation: That on or about February 10, 2005, in the City of Zamboanga,
Philippines, and within the jurisdiction of this Honorable Court, the above
named accused, not being authorized by law to sell, deliver, transport,
distribute or give away to another any dangerous drug, did then and there
willfully and unlawfully, sell and deliver to PO2 Ronald Canete Cordero,
member of the PNP, Anti-Illegal Drugs Special Operation Task
Force(AIDSOTF), who acted as poseur buyer, one (1) pc. heat sealed
transparent plastic sachet containing white crystalline substance weighing
0.0188 gram, which when subjected to qualitative examination gave
717
positive result to the test for the presence of METHAMPHET AMINE
HYDROCHLORIDE(shabu), accused knowing the same to be a dangerous
drug, in flagrant violation of the above-mentioned law.

CONTRARY TO LAW. Upon arraignment, Acub pleaded not guilty to the

charge against him. Trial on the merits ensued, with the prosecution
presenting three (3) police officers as its witnesses and the defense
presenting Acub and his wife, Intan Acub (Intan), as its witnesses.

In his defense, Acub, a pedicab driver, testified that on February 10,2005,

he was at home resting after he and his wife, Intan, had gone to the
pawnshop earlier that morning to pawn her earrings. Later, at around 1
:00p.m., he went outside to buy food. On his way back, Acub was suddenly
stopped by two (2) men and one (1) woman. One (1) of the men restrained
him, while the other poked a gun at him and asked if he had money. After
Acub denied having money, they all brought him to his house. 15Inside his
house, Acub saw his wife crying while three (3) other persons searched his
house for shabu. When they found nothing, all six (6) strangers then
brought Acub to the police station. 16Intan corroborated her husband's
testimony. She testified that while her husband was outside buying food,
three (3) police officers in civilian clothes suddenly entered and searched
their house without a search warrant. They left after finding nothing, but
soon returned with more police officers
and Acub, who had his hand cuffed and was beaten up by the police
officers

ISSUE:

WON accused appellant Gaj ir Acub y Arakani' s guilt was proven beyond
reasonable doubt despite noncompliance with the required procedure
under Section 21 of the Comprehensive Dangerous Drugs Act, as amended

RULING:

718
Accused-appellant must be acquitted. To sustain a conviction for the illegal
sale of dangerous drugs, it must be proven that a transaction took place
and the corpus delicti or the illicit drug must be presented into evidence.
Although not easily identifiable, the identity of the illicit drug must be
clearly established since its very existence is essential to convict an accused.
This Court has repeatedly emphasized that strict compliance is the
expected standard when it comes to the custody and disposition of seized
illegal drugs, to prevent tampering and planting of evidence.

The prosecution failed to prove that an inventory of the seized sachet was
prepared and that it was photographed in the presence of accused
appellant, an elected public official, and representatives from the National
Prosecution Service or the media. Despite the blatant lapses, the
prosecution did not explain the arresting officers' failure to comply with
the requirement sin Section 21. Nonetheless, despite the prosecution's
indifference to the established legal safeguards, both the lower courts still
found accused appellant guilty of the charge against him.

WHEREFORE, the March 16, 2015 Decision of the Court of Appeals in CA-
G.R. CR HC No. 01003-MIN is REVERSED and SET ASIDE. Accused-
appellant Gajir Acub y Arakani a.k.a. "Asaw" is ACQUITTED for the
prosecution's failure to prove his guilt beyond reasonable doubt. He is
ordered immediately RELEASED from detention, unless he is confined
forany other lawful cause.

719
 ADELAIDO ORIONDO, TEODORO M. HERNANDEZ, RENATO L.
BASCO, CARMEN MERINO, AND REYNALDO SALVADOR,
PETITIONERS, v. COMMISSION ON AUDIT, RESPONDENT.

G.R. No. 211293,

June 04, 2019

Leonen J.

DOCTRINE:

A corporation, whether with or without an original charter, is under the audit

jurisdiction of the Commission on Audit so long as the government owns or has
controlling interest in it.

FACTS:

Executive Order No. 58, series of 1954,5 made certain battlefield areas
in Corregidor open to the public and accessible as tourist attractions.
Executive Order No. 123, series of 1968, further amended Executive Order
No. 58, thereby authorizing the Ministry of National Defense to enter into
contracts for the conversion of areas within the Corregidor as tourist spots.6

Pursuant to Executive Order No. 123, the Ministry of National

Defense and the Philippine Tourism Authority executed a Memorandum of
Agreement7 dated July 10, 1986 for the development of Corregidor and its
neighboring islands into major tourist attractions. Specifically, the Ministry
of National Defense, with prior approval of the President, leased the entire
island of Corregidor to the Philippine Tourism Authority for one peso
(P1.00). As for the Philippine Tourism Authority, it undertook to maintain
and preserve the war relics on the island and to fully develop Corregidor's
potential as an international and local tourist destination. The Philippine
Tourism Authority was thus authorized to "[p]ackage and source the
necessary funds to develop and restore the Corregidor Island group."8

720
 On February 14, 2005, the Commission on Audit, through Audit
Team Leader Divina M. Telan, issued Audit Observation Memorandum
No. 2004-00213 for comments of then Corregidor Foundation, Inc. Executive
Director Artemio G. Matibag. There, the Audit Team noted that the
following personnel of the Philippine Tourism Authority who were
concurrently rendering services in Corregidor Foundation, Inc. received
honoraria and cash gifts in 2003, to wit:

Cash
Name Position Bonus Total
Gift
Treasurer / Deputy General
Adelaido
Manager of the Philippine 42,000 1,500 43,500
Oriondo
Tourism Authority
Teodoro
Corporate Secretary 42,000 1,500 43,500
Hernandez
Renato L.
Technical Assistant 16,000 1,500 17,500
Basco
Carmen
Executive Secretary A 9,600 1,500 11,100
Merino
Reynaldo
Utility Worker A 14,400 1,500 15,900
Salvador
Total 124,000 7,500 131,500
The Audit Team was of the opinion that the grant of honoraria to Oriondo,
Hernandez, Basco, Merino, and Salvador were contrary to Department of
Budget and Management Circular No. 2003-5. This budget circular,
applicable to all national government agencies, government-owned and/or
controlled corporations, and government financial institutions, enumerated
in item 4 those exclusively entitled to honoraria:

4. General Guidelines

Heads of entities are authorized to use their respective appropriation

for the payment of honoraria only to the following:
721
4.1. teaching personnel of the Department of Education,
Commission on Higher Education, Technical Education and
Skills Development Authority, State Universities and
Colleges and other educational institutions engaged in actual
classroom teaching whose teaching load is outside of the
regular office hours and/or in excess of the regular load;

4.2 those who act as lecturers, resource persons, coordinators

and facilitators in seminars, training programs and other
similar activities in training institutions, including those
conducted by entities for their officials and employees; and

4.3. chairs and members of Commissions/Board Councils and

other similar entities which are hereinafter referred to as a
collegial body including the personnel thereof, who are
neither paid salaries nor per diems but compensated in the
form of honoraria as provided by law, rules and
regulations.15
Further, according to the Audit Team, the cash gifts given to Oriondo,
Hernandez, Basco, Merino, and Salvador, as officers of the Corregidor
Foundation, Inc., constituted double compensation prohibited in Article IX-
B, Section 816 of the Constitution because they had already received
honoraria and cash gifts as employees of the Philippine Tourism Authority.

ISSUES:

1. Whether or not the Commission on Audit has jurisdiction to

determine whether a corporation such as Corregidor Foundation, Inc. is a
government-owned or controlled corporation; and
2. Whether or not Corregidor Foundation, Inc. is a government-owned
or controlled corporation under the audit jurisdiction of the Commission
on Audit.

722
RULING:

We first address respondent Commission's contention that petitioners

erroneously referred to their Petition as a "Petition for Review on
Certiorari" under Rule 64 of the Rules of Court.

A petition for review on certiorari is the remedy provided in Rule 45,

Section 1 of the Rules of Court against an adverse judgment, final order, or
resolution of the Court of Appeals, the Sandiganbayan, the Regional Trial
Court or other courts whenever authorized by law.

We agree with respondent Commission that petitioners erroneously

denominated their Petition as a "Petition for Review on Certiorari." Except
for the designation, however, we find that the Petition was filed under Rule
64 of the Rules of Court given that the Petition refers to Rule 64 and was
filed within 30 days from notice of the Resolution dated December 6, 2013
denying petitioners' Motion for Reconsideration before the Commission on
Audit. Therefore, we shall resolve the Petition in the exercise of our
certiorari jurisdiction under Article IX-A, Section 7 of the Constitution.

Secondly, ommission on Audit generally has audit jurisdiction over public

entities.59 In the Administrative Code's Introductory Provisions, the
Commission on Audit is even allowed to categorize government-owned or
controlled corporations for purposes of the exercise and discharge of its
powers, functions, and responsibilities with respect to such corporations.60

The extent of the Commission on Audit's audit authority even

extends to non-governmental entities that receive subsidy or equity from or
through the government.61

Therefore, it is absurd for petitioners to challenge the competency of

the Commission on Audit to determine whether or not an entity is a
government-owned or controlled corporation. Jurisdiction is "the power to
hear and determine cases of the general class to which the proceedings in

723
question belong,"62 and the determination of whether or not an entity is the
proper subject of its audit jurisdiction is a necessary part of the
Commission's constitutional mandate to examine and audit the
government as well as non-government entities that receive subsidies from
it. To insist on petitioners' argument would be to impede the Commission
on Audit's exercise of its powers and functions.

This Court upheld the competence of the Commission on Audit to

determine the status of an entity as a government-owned or controlled
corporation in Feliciano v. Commission on Audit63 and Boy Scouts of the
Philippines,64 among others. In these cases, the Court took cognizance of
petitions assailing the Commission on Audit's determination that Leyte
Metropolitan Water District and Boy Scouts of the Philippines are
government-owned or controlled corporations, and are thus subject to the
Commission's audit jurisdiction.

WHEREFORE, the Petition for Certiorari is DISMISSED.

724