197, 200, 234, 265, 286, 298, 303,
312, 324, 325, 326, 337, 355, 358,
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-63915 April 24, 1985
LORENZO M. TAÑADA, ABRAHAM F.
SARMIENTO, and MOVEMENT OF ATTORNEYS
FOR BROTHERHOOD, INTEGRITY AND
NATIONALISM, INC. [MABINI], petitioners,
vs.
HON. JUAN C. TUVERA, in his capacity as
Executive Assistant to the President, HON.
JOAQUIN VENUS, in his capacity as Deputy
Executive Assistant to the President ,
MELQUIADES P. DE LA CRUZ, in his capacity as
Director, Malacañang Records Office, and
FLORENDO S. PABLO, in his capacity as Director,
Bureau of Printing, respondents.
ESCOLIN, J.:
Invoking the people's right to be informed on matters of
public concern, a right recognized in Section 6, Article
IV of the 1973 Philippine Constitution, 1 as well as the
principle that laws to be valid and enforceable must be
published in the Official Gazette or otherwise
effectively promulgated, petitioners seek a writ of
mandamus to compel respondent public officials to
publish, and/or cause the publication in the Official
Gazette of various presidential decrees, letters of
instructions, general orders, proclamations, executive
orders, letter of implementation and administrative
orders.
Specifically, the publication of the following presidential
issuances is sought:
a] Presidential Decrees Nos. 12, 22,
37, 38, 59, 64, 103, 171, 179, 184,
1843-1844, 1846-1847, 1849, 1853-
1858, 1860, 1866, 1868, 1870,
359, 360, 361, 368, 404, 406, 415,
427, 429, 445, 447, 473, 486, 491,
503, 504, 521, 528, 551, 566, 573,
574, 594, 599, 644, 658, 661, 718,
731, 733, 793, 800, 802, 835, 836,
923, 935, 961, 1017-1030, 1050,
1060-1061, 1085, 1143, 1165, 1166,
1242, 1246, 1250, 1278, 1279,
1300, 1644, 1772, 1808, 1810,
1813-1817, 1819-1826, 1829-1840,
1842-1847.
b] Letter of Instructions Nos.: 10, 39,
49, 72, 107, 108, 116, 130, 136, 141,
150, 153, 155, 161, 173, 180, 187,
188, 192, 193, 199, 202, 204, 205,
209, 211-213, 215-224, 226-228,
231-239, 241-245, 248, 251, 253-
261, 263-269, 271-273, 275-283,
285-289, 291, 293, 297-299, 301-
303, 309, 312-315, 325, 327, 343,
346, 349, 357, 358, 362, 367, 370,
382, 385, 386, 396-397, 405, 438-
440, 444- 445, 473, 486, 488, 498,
501, 399, 527, 561, 576, 587, 594,
599, 600, 602, 609, 610, 611, 612,
615, 641, 642, 665, 702, 712-713,
726, 837-839, 878-879, 881, 882,
939-940, 964,997,1149-1178,1180-
1278.
c] General Orders Nos.: 14, 52, 58,
59, 60, 62, 63, 64 & 65.
d] Proclamation Nos.: 1126, 1144,
1147, 1151, 1196, 1270, 1281,
1319-1526, 1529, 1532, 1535, 1538,
1540-1547, 1550-1558, 1561-1588,
1590-1595, 1594-1600, 1606-1609,
1612-1628, 1630-1649, 1694-1695,
1697-1701, 1705-1723, 1731-1734,
1737-1742, 1744, 1746-1751, 1752,
1754, 1762, 1764-1787, 1789-1795,
1797, 1800, 1802-1804, 1806-1807,
1812-1814, 1816, 1825-1826, 1829,
1831-1832, 1835-1836, 1839-1840,
1876-1889, 1892, 1900, 1918, 1923,
1933, 1952, 1963, 1965-1966, 1968-
1984, 1986-2028, 2030-2044, 2046-
2145, 2147-2161, 2163-2244.
e] Executive Orders Nos.: 411, 413,
414, 427, 429-454, 457- 471, 474-
492, 494-507, 509-510, 522, 524-
528, 531-532, 536, 538, 543-544,
549, 551-553, 560, 563, 567-568,
570, 574, 593, 594, 598-604, 609,
611- 647, 649-677, 679-703, 705-
707, 712-786, 788-852, 854-857.
f] Letters of Implementation Nos.: 7,
8, 9, 10, 11-22, 25-27, 39, 50, 51, 59,
76, 80-81, 92, 94, 95, 107, 120, 122,
123.
g] Administrative Orders Nos.: 347,
348, 352-354, 360- 378, 380-433,
436-439.
The respondents, through the Solicitor General, would
have this case dismissed outright on the ground that
petitioners have no legal personality or standing to
bring the instant petition. The view is submitted that in
the absence of any showing that petitioners are
personally and directly affected or prejudiced by the
alleged non-publication of the presidential issuances in
question 2 said petitioners are without the requisite
legal personality to institute this mandamus
proceeding, they are not being "aggrieved parties"
within the meaning of Section 3, Rule 65 of the Rules
of Court, which we quote:
SEC. 3. Petition for Mandamus.—
When any tribunal, corporation,
board or person unlawfully neglects
the performance of an act which the
law specifically enjoins as a duty
resulting from an office, trust, or
station, or unlawfully excludes
another from the use a rd enjoyment
of a right or office to which such
1
 other is entitled, and there is no
other plain, speedy and adequate
remedy in the ordinary course of law,
the person aggrieved thereby may
file a verified petition in the proper
court alleging the facts with certainty
and praying that judgment be
rendered commanding the
defendant, immediately or at some
other specified time, to do the act
required to be done to Protect the
rights of the petitioner, and to pay
the damages sustained by the
petitioner by reason of the wrongful
acts of the defendant.
Upon the other hand, petitioners maintain that since
the subject of the petition concerns a public right and
its object is to compel the performance of a public duty,
they need not show any specific interest for their
petition to be given due course.
The issue posed is not one of first impression. As early
as the 1910 case of Severino vs. Governor
General, 3 this Court held that while the general rule is
that "a writ of mandamus would be granted to a private
individual only in those cases where he has some
private or particular interest to be subserved, or some
particular right to be protected, independent of that
which he holds with the public at large," and "it is for
the public officers exclusively to apply for the writ when
public rights are to be subserved [Mithchell vs.
Boardmen, 79 M.e., 469]," nevertheless, "when the
question is one of public right and the object of the
mandamus is to procure the enforcement of a public
duty, the people are regarded as the real party in
interest and the relator at whose instigation the
proceedings are instituted need not show that he has
any legal or special interest in the result, it being
sufficient to show that he is a citizen and as such
interested in the execution of the laws [High,
Extraordinary Legal Remedies, 3rd ed., sec. 431].
Thus, in said case, this Court recognized the relator
Lope Severino, a private individual, as a proper party
to the mandamus proceedings brought to compel the
Governor General to call a special election for the
position of municipal president in the town of Silay,
Negros Occidental. Speaking for this Court, Mr. Justice
Grant T. Trent said:
We are therefore of the opinion that
the weight of authority supports the
proposition that the relator is a
proper party to proceedings of this
character when a public right is
sought to be enforced. If the general
rule in America were otherwise, we
think that it would not be applicable
to the case at bar for the reason 'that
it is always dangerous to apply a
general rule to a particular case
without keeping in mind the reason
for the rule, because, if under the
particular circumstances the reason
for the rule does not exist, the rule
itself is not applicable and reliance
upon the rule may well lead to error'
No reason exists in the case at bar
for applying the general rule insisted
upon by counsel for the respondent.
The circumstances which surround
this case are different from those in
the United States, inasmuch as if the
relator is not a proper party to these
proceedings no other person could
be, as we have seen that it is not the
duty of the law officer of the
Government to appear and
represent the people in cases of this
character.
The reasons given by the Court in recognizing a private
citizen's legal personality in the aforementioned case
apply squarely to the present petition. Clearly, the right
sought to be enforced by petitioners herein is a public
right recognized by no less than the fundamental law
of the land. If petitioners were not allowed to institute
this proceeding, it would indeed be difficult to conceive
of any other person to initiate the same, considering
that the Solicitor General, the government officer
generally empowered to represent the people, has
entered his appearance for respondents in this case.
Respondents further contend that publication in the
Official Gazette is not a sine qua non requirement for
the effectivity of laws where the laws themselves
provide for their own effectivity dates. It is thus
submitted that since the presidential issuances in
question contain special provisions as to the date they
are to take effect, publication in the Official Gazette is
not indispensable for their effectivity. The point
stressed is anchored on Article 2 of the Civil Code:
Art. 2. Laws shall take effect after
fifteen days following the completion
of their publication in the Official
Gazette, unless it is otherwise
provided, ...
The interpretation given by respondent is in accord with
this Court's construction of said article. In a long line of
decisions, 4 this Court has ruled that publication in the
Official Gazette is necessary in those cases where the
legislation itself does not provide for its effectivity date-
for then the date of publication is material for
determining its date of effectivity, which is the fifteenth
day following its publication-but not when the law itself
provides for the date when it goes into effect.
Respondents' argument, however, is logically correct
only insofar as it equates the effectivity of laws with the
fact of publication. Considered in the light of other
statutes applicable to the issue at hand, the conclusion
is easily reached that said Article 2 does not preclude
the requirement of publication in the Official Gazette,
even if the law itself provides for the date of its
effectivity. Thus, Section 1 of Commonwealth Act 638
provides as follows:
Section 1. There shall be published
in the Official Gazette [1] all
important legisiative acts and
resolutions of a public nature of the,
Congress of the Philippines; [2] all
executive and administrative orders
and proclamations, except such as
have no general applicability; [3]
decisions or abstracts of decisions of
the Supreme Court and the Court of
Appeals as may be deemed by said
courts of sufficient importance to be
2
 so published; [4] such documents or
classes of documents as may be
required so to be published by law;
and [5] such documents or classes
of documents as the President of the
Philippines shall determine from
time to time to have general
applicability and legal effect, or
which he may authorize so to be
published. ...
The clear object of the above-quoted provision is to
give the general public adequate notice of the various
laws which are to regulate their actions and conduct as
citizens. Without such notice and publication, there
would be no basis for the application of the maxim
"ignorantia legis non excusat." It would be the height of
injustice to punish or otherwise burden a citizen for the
transgression of a law of which he had no notice
whatsoever, not even a constructive one.
Perhaps at no time since the establishment of the
Philippine Republic has the publication of laws taken
so vital significance that at this time when the people
have bestowed upon the President a power heretofore
enjoyed solely by the legislature. While the people are
kept abreast by the mass media of the debates and
deliberations in the Batasan Pambansa—and for the
diligent ones, ready access to the legislative records—
no such publicity accompanies the law-making process
of the President. Thus, without publication, the people
have no means of knowing what presidential decrees
have actually been promulgated, much less a definite
way of informing themselves of the specific contents
and texts of such decrees. As the Supreme Court of
Spain ruled: "Bajo la denominacion generica de leyes,
se comprenden tambien los reglamentos, Reales
decretos, Instrucciones, Circulares y Reales ordines
dictadas de conformidad con las mismas por el
Gobierno en uso de su potestad. 5
The very first clause of Section I of Commonwealth Act
638 reads: "There shall be published in the Official
Gazette ... ." The word "shall" used therein imposes
upon respondent officials an imperative duty. That duty
must be enforced if the Constitutional right of the
people to be informed on matters of public concern is
to be given substance and reality. The law itself makes
a list of what should be published in the Official
Gazette. Such listing, to our mind, leaves respondents
with no discretion whatsoever as to what must be
included or excluded from such publication.
The publication of all presidential issuances "of a public
nature" or "of general applicability" is mandated by law.
Obviously, presidential decrees that provide for fines,
forfeitures or penalties for their violation or otherwise
impose a burden or. the people, such as tax and
revenue measures, fall within this category. Other
presidential issuances which apply only to particular
persons or class of persons such as administrative and
executive orders need not be published on the
assumption that they have been circularized to all
concerned. 6
It is needless to add that the publication of presidential
issuances "of a public nature" or "of general
applicability" is a requirement of due process. It is a
rule of law that before a person may be bound by law,
he must first be officially and specifically informed of its
contents. As Justice Claudio Teehankee said
in Peralta vs. COMELEC 7:
In a time of proliferating decrees,
orders and letters of instructions
which all form part of the law of the
land, the requirement of due process
and the Rule of Law demand that the
Official Gazette as the official
government repository promulgate
and publish the texts of all such
decrees, orders and instructions so
that the people may know where to
obtain their official and specific
contents.
The Court therefore declares that presidential
issuances of general application, which have not been
published, shall have no force and effect. Some
members of the Court, quite apprehensive about the
possible unsettling effect this decision might have on
acts done in reliance of the validity of those presidential
decrees which were published only during the
pendency of this petition, have put the question as to
whether the Court's declaration of invalidity apply to
P.D.s which had been enforced or implemented prior
to their publication. The answer is all too familiar. In
similar situations in the past this Court had taken the
pragmatic and realistic course set forth in Chicot
County Drainage District vs. Baxter Bank 8 to wit:
The courts below have proceeded
on the theory that the Act of
Congress, having been found to be
unconstitutional, was not a law; that
it was inoperative, conferring no
rights and imposing no duties, and
hence affording no basis for the
challenged decree. Norton v. Shelby
County, 118 U.S. 425, 442; Chicago,
1. & L. Ry. Co. v. Hackett, 228 U.S.
559, 566. It is quite clear, however,
that such broad statements as to the
effect of a determination of
unconstitutionality must be taken
with qualifications. The actual
existence of a statute, prior to such
a determination, is an operative fact
and may have consequences which
cannot justly be ignored. The past
cannot always be erased by a new
judicial declaration. The effect of the
subsequent ruling as to invalidity
may have to be considered in
various aspects-with respect to
particular conduct, private and
official. Questions of rights claimed
to have become vested, of status, of
prior determinations deemed to
have finality and acted upon
accordingly, of public policy in the
light of the nature both of the statute
and of its previous application,
demand examination. These
questions are among the most
difficult of those which have
engaged the attention of courts,
state and federal and it is manifest
from numerous decisions that an all-
inclusive statement of a principle of
absolute retroactive invalidity cannot
be justified.
3
Consistently with the above principle, this Court
in Rutter vs. Esteban 9 sustained the right of a party
under the Moratorium Law, albeit said right had
accrued in his favor before said law was declared
unconstitutional by this Court.
Similarly, the implementation/enforcement of
presidential decrees prior to their publication in the
Official Gazette is "an operative fact which may have
consequences which cannot be justly ignored. The
past cannot always be erased by a new judicial
declaration ... that an all-inclusive statement of a
principle of absolute retroactive invalidity cannot be
justified."
From the report submitted to the Court by the Clerk of
Court, it appears that of the presidential decrees
sought by petitioners to be published in the Official
Gazette, only Presidential Decrees Nos. 1019 to 1030,
inclusive, 1278, and 1937 to 1939, inclusive, have not
been so published. 10 Neither the subject matters nor
the texts of these PDs can be ascertained since no
copies thereof are available. But whatever their subject
matter may be, it is undisputed that none of these
unpublished PDs has ever been implemented or
enforced by the government. In Pesigan vs.
Angeles, 11 the Court, through Justice Ramon Aquino,
ruled that "publication is necessary to apprise the
public of the contents of [penal] regulations and make
the said penalties binding on the persons affected
thereby. " The cogency of this holding is apparently
recognized by respondent officials considering the
manifestation in their comment that "the government,
as a matter of policy, refrains from prosecuting
violations of criminal laws until the same shall have
been published in the Official Gazette or in some other
publication, even though some criminal laws provide
that they shall take effect immediately.
WHEREFORE, the Court hereby orders respondents
to publish in the Official Gazette all unpublished
presidential issuances which are of general
application, and unless so published, they shall have
no binding force and effect.
SO ORDERED.
Relova, J., concurs.
Aquino, J., took no part.
Concepcion, Jr., J., is on leave.
Separate Opinions
FERNANDO, C.J., concurring (with qualification):
There is on the whole acceptance on my part of the
views expressed in the ably written opinion of Justice
Escolin. I am unable, however, to concur insofar as it
would unqualifiedly impose the requirement of
publication in the Official Gazette for unpublished
"presidential issuances" to have binding force and
effect.
I shall explain why.
1. It is of course true that without the requisite
publication, a due process question would arise if
made to apply adversely to a party who is not even
aware of the existence of any legislative or executive
act having the force and effect of law. My point is that
such publication required need not be confined to the
Official Gazette. From the pragmatic standpoint, there
is an advantage to be gained. It conduces to certainty.
That is too be admitted. It does not follow, however,
that failure to do so would in all cases and under all
circumstances result in a statute, presidential decree
or any other executive act of the same category being
bereft of any binding force and effect. To so hold would,
for me, raise a constitutional question. Such a
pronouncement would lend itself to the interpretation
that such a legislative or presidential act is bereft of the
attribute of effectivity unless published in the Official
Gazette. There is no such requirement in the
Constitution as Justice Plana so aptly pointed out. It is
true that what is decided now applies only to past
"presidential issuances". Nonetheless, this clarification
is, to my mind, needed to avoid any possible
misconception as to what is required for any statute or
presidential act to be impressed with binding force or
effectivity.
2. It is quite understandable then why I concur in the
separate opinion of Justice Plana. Its first paragraph
sets forth what to me is the constitutional doctrine
applicable to this case. Thus: "The Philippine
Constitution does not require the publication of laws as
a prerequisite for their effectivity, unlike some
Constitutions elsewhere. It may be said though that the
guarantee of due process requires notice of laws to
affected Parties before they can be bound thereby; but
such notice is not necessarily by publication in the
Official Gazette. The due process clause is not that
precise. 1 I am likewise in agreement with its closing
paragraph: "In fine, I concur in the majority decision to
the extent that it requires notice before laws become
effective, for no person should be bound by a law
without notice. This is elementary fairness. However, I
beg to disagree insofar as it holds that such notice shall
be by publication in the Official Gazette. 2
3. It suffices, as was stated by Judge Learned Hand,
that law as the command of the government "must be
ascertainable in some form if it is to be enforced at
all. 3 It would indeed be to reduce it to the level of mere
futility, as pointed out by Justice Cardozo, "if it is
unknown and unknowable. 4 Publication, to repeat, is
thus essential. What I am not prepared to subscribe to
is the doctrine that it must be in the Official Gazette. To
be sure once published therein there is the
ascertainable mode of determining the exact date of its
effectivity. Still for me that does not dispose of the
question of what is the jural effect of past presidential
decrees or executive acts not so published. For prior
thereto, it could be that parties aware of their existence
could have conducted themselves in accordance with
their provisions. If no legal consequences could attach
due to lack of publication in the Official Gazette, then
serious problems could arise. Previous transactions
based on such "Presidential Issuances" could be open
to question. Matters deemed settled could still be
inquired into. I am not prepared to hold that such an
effect is contemplated by our decision. Where such
presidential decree or executive act is made the basis
4
of a criminal prosecution, then, of course, its ex post
facto character becomes evident. 5 In civil cases
though, retroactivity as such is not conclusive on the
due process aspect. There must still be a showing of
arbitrariness. Moreover, where the challenged
presidential decree or executive act was issued under
the police power, the non-impairment clause of the
Constitution may not always be successfully invoked.
There must still be that process of balancing to
determine whether or not it could in such a case be
tainted by infirmity. 6 In traditional terminology, there
could arise then a question of unconstitutional
application. That is as far as it goes.
4. Let me make therefore that my qualified concurrence
goes no further than to affirm that publication is
essential to the effectivity of a legislative or executive
act of a general application. I am not in agreement with
the view that such publication must be in the Official
Gazette. The Civil Code itself in its Article 2 expressly
recognizes that the rule as to laws taking effect after
fifteen days following the completion of their publication
in the Official Gazette is subject to this exception,
"unless it is otherwise provided." Moreover, the Civil
Code is itself only a legislative enactment, Republic Act
No. 386. It does not and cannot have the juridical force
of a constitutional command. A later legislative or
executive act which has the force and effect of law can
legally provide for a different rule.
5. Nor can I agree with the rather sweeping conclusion
in the opinion of Justice Escolin that presidential
decrees and executive acts not thus previously
published in the Official Gazette would be devoid of
any legal character. That would be, in my opinion, to
go too far. It may be fraught, as earlier noted, with
undesirable consequences. I find myself therefore
unable to yield assent to such a pronouncement.
I am authorized to state that Justices Makasiar, Abad
Santos, Cuevas, and Alampay concur in this separate
opinion.
Makasiar, Abad Santos, Cuevas and Alampay, JJ.,
concur.
TEEHANKEE, J., concurring:
I concur with the main opinion of Mr. Justice Escolin
and the concurring opinion of Mme. Justice Herrera.
The Rule of Law connotes a body of norms and laws
published and ascertainable and of equal application to
all similarly circumstances and not subject to arbitrary
change but only under certain set procedures. The
Court has consistently stressed that "it is an
elementary rule of fair play and justice that a
reasonable opportunity to be informed must be
afforded to the people who are commanded to obey
before they can be punished for its violation, 1 citing the
settled principle based on due process enunciated in
earlier cases that "before the public is bound by its
contents, especially its penal provisions, a law,
regulation or circular must first be published and the
people officially and specially informed of said contents
and its penalties.
Without official publication in the Official Gazette as
required by Article 2 of the Civil Code and the Revised
Administrative Code, there would be no basis nor
justification for the corollary rule of Article 3 of the Civil
Code (based on constructive notice that the provisions
of the law are ascertainable from the public and official
repository where they are duly published) that
"Ignorance of the law excuses no one from compliance
therewith.
Respondents' contention based on a misreading of
Article 2 of the Civil Code that "only laws which are
silent as to their effectivity [date] need be published in
the Official Gazette for their effectivity" is manifestly
untenable. The plain text and meaning of the Civil
Code is that "laws shall take effect after fifteen days
following the completion of their publication in the
Official Gazette, unless it is otherwise provided, " i.e. a
different effectivity date is provided by the law itself.
This proviso perforce refers to a law that has been duly
published pursuant to the basic constitutional
requirements of due process. The best example of this
is the Civil Code itself: the same Article 2 provides
otherwise that it "shall take effect [only] one year [not
15 days] after such publication. 2 To sustain
respondents' misreading that "most laws or decrees
specify the date of their effectivity and for this reason,
publication in the Official Gazette is not necessary for
their effectivity 3 would be to nullify and render
nugatory the Civil Code's indispensable and essential
requirement of prior publication in the Official Gazette
by the simple expedient of providing for immediate
effectivity or an earlier effectivity date in the law
itself before the completion of 15 days following its
publication which is the period generally fixed by the
Civil Code for its proper dissemination.
MELENCIO-HERRERA, J., concurring:
I agree. There cannot be any question but that even if
a decree provides for a date of effectivity, it has to be
published. What I would like to state in connection with
that proposition is that when a date of effectivity is
mentioned in the decree but the decree becomes
effective only fifteen (15) days after its publication in
the Official Gazette, it will not mean that the decree can
have retroactive effect to the date of effectivity
mentioned in the decree itself. There should be no
retroactivity if the retroactivity will run counter to
constitutional rights or shall destroy vested rights.
PLANA, J., concurring (with qualification):
The Philippine Constitution does not require the
publication of laws as a prerequisite for their effectivity,
unlike some Constitutions elsewhere. * It may be said
though that the guarantee of due process requires
notice of laws to affected parties before they can be
bound thereby; but such notice is not necessarily by
publication in the Official Gazette. The due process
clause is not that precise. Neither is the publication of
laws in the Official Gazette required by any statute as a
prerequisite for their effectivity, if said laws already
provide for their effectivity date.
Article 2 of the Civil Code provides that "laws shall take
effect after fifteen days following the completion of their
publication in the Official Gazette, unless it is otherwise
provided " Two things may be said of this provision:
Firstly, it obviously does not apply to a law with a built-
in provision as to when it will take effect. Secondly, it
5
clearly recognizes that each law may provide not only
a different period for reckoning its effectivity date but
also a different mode of notice. Thus, a law may
prescribe that it shall be published elsewhere than in
the Official Gazette.
Commonwealth Act No. 638, in my opinion, does not
support the proposition that for their effectivity, laws
must be published in the Official Gazette. The said law
is simply "An Act to Provide for the Uniform Publication
and Distribution of the Official Gazette." Conformably
therewith, it authorizes the publication of the Official
Gazette, determines its frequency, provides for its sale
and distribution, and defines the authority of the
Director of Printing in relation thereto. It also
enumerates what shall be published in the Official
Gazette, among them, "important legislative acts and
resolutions of a public nature of the Congress of the
Philippines" and "all executive and administrative
orders and proclamations, except such as have no
general applicability." It is noteworthy that not all
legislative acts are required to be published in the
Official Gazette but only "important" ones "of a public
nature." Moreover, the said law does not provide that
publication in the Official Gazette is essential for the
effectivity of laws. This is as it should be, for all statutes
are equal and stand on the same footing. A law,
especially an earlier one of general application such as
Commonwealth Act No. 638, cannot nullify or restrict
the operation of a subsequent statute that has a
provision of its own as to when and how it will take
effect. Only a higher law, which is the Constitution, can
assume that role.
In fine, I concur in the majority decision to the extent
that it requires notice before laws become effective, for
no person should be bound by a law without notice.
This is elementary fairness. However, I beg to disagree
insofar as it holds that such notice shall be by
publication in the Official Gazette.
Cuevas and Alampay, JJ., concur.
GUTIERREZ, Jr., J., concurring:
I concur insofar as publication is necessary but reserve
my vote as to the necessity of such publication being
in the Official Gazette.
DE LA FUENTE, J., concurring:
I concur insofar as the opinion declares the
unpublished decrees and issuances of a public nature
or general applicability ineffective, until due publication
thereof.
Separate Opinions
FERNANDO, C.J., concurring (with qualification):
There is on the whole acceptance on my part of the
views expressed in the ably written opinion of Justice
Escolin. I am unable, however, to concur insofar as it
would unqualifiedly impose the requirement of
publication in the Official Gazette for unpublished
"presidential issuances" to have binding force and
effect.
I shall explain why.
1. It is of course true that without the requisite
publication, a due process question would arise if
made to apply adversely to a party who is not even
aware of the existence of any legislative or executive
act having the force and effect of law. My point is that
such publication required need not be confined to the
Official Gazette. From the pragmatic standpoint, there
is an advantage to be gained. It conduces to certainty.
That is too be admitted. It does not follow, however,
that failure to do so would in all cases and under all
circumstances result in a statute, presidential decree
or any other executive act of the same category being
bereft of any binding force and effect. To so hold would,
for me, raise a constitutional question. Such a
pronouncement would lend itself to the interpretation
that such a legislative or presidential act is bereft of the
attribute of effectivity unless published in the Official
Gazette. There is no such requirement in the
Constitution as Justice Plana so aptly pointed out. It is
true that what is decided now applies only to past
"presidential issuances". Nonetheless, this clarification
is, to my mind, needed to avoid any possible
misconception as to what is required for any statute or
presidential act to be impressed with binding force or
effectivity.
2. It is quite understandable then why I concur in the
separate opinion of Justice Plana. Its first paragraph
sets forth what to me is the constitutional doctrine
applicable to this case. Thus: "The Philippine
Constitution does not require the publication of laws as
a prerequisite for their effectivity, unlike some
Constitutions elsewhere. It may be said though that the
guarantee of due process requires notice of laws to
affected Parties before they can be bound thereby; but
such notice is not necessarily by publication in the
Official Gazette. The due process clause is not that
precise. 1 I am likewise in agreement with its closing
paragraph: "In fine, I concur in the majority decision to
the extent that it requires notice before laws become
effective, for no person should be bound by a law
without notice. This is elementary fairness. However, I
beg to disagree insofar as it holds that such notice shall
be by publication in the Official Gazette. 2
3. It suffices, as was stated by Judge Learned Hand,
that law as the command of the government "must be
ascertainable in some form if it is to be enforced at
all. 3 It would indeed be to reduce it to the level of mere
futility, as pointed out by Justice Cardozo, "if it is
unknown and unknowable. 4 Publication, to repeat, is
thus essential. What I am not prepared to subscribe to
is the doctrine that it must be in the Official Gazette. To
be sure once published therein there is the
ascertainable mode of determining the exact date of its
effectivity. Still for me that does not dispose of the
question of what is the jural effect of past presidential
decrees or executive acts not so published. For prior
thereto, it could be that parties aware of their existence
could have conducted themselves in accordance with
their provisions. If no legal consequences could attach
due to lack of publication in the Official Gazette, then
serious problems could arise. Previous transactions
based on such "Presidential Issuances" could be open
to question. Matters deemed settled could still be
inquired into. I am not prepared to hold that such an
effect is contemplated by our decision. Where such
6
presidential decree or executive act is made the basis
of a criminal prosecution, then, of course, its ex post
facto character becomes evident. 5 In civil cases
though, retroactivity as such is not conclusive on the
due process aspect. There must still be a showing of
arbitrariness. Moreover, where the challenged
presidential decree or executive act was issued under
the police power, the non-impairment clause of the
Constitution may not always be successfully invoked.
There must still be that process of balancing to
determine whether or not it could in such a case be
tainted by infirmity. 6 In traditional terminology, there
could arise then a question of unconstitutional
application. That is as far as it goes.
4. Let me make therefore that my qualified concurrence
goes no further than to affirm that publication is
essential to the effectivity of a legislative or executive
act of a general application. I am not in agreement with
the view that such publication must be in the Official
Gazette. The Civil Code itself in its Article 2 expressly
recognizes that the rule as to laws taking effect after
fifteen days following the completion of their publication
in the Official Gazette is subject to this exception,
"unless it is otherwise provided." Moreover, the Civil
Code is itself only a legislative enactment, Republic Act
No. 386. It does not and cannot have the juridical force
of a constitutional command. A later legislative or
executive act which has the force and effect of law can
legally provide for a different rule.
5. Nor can I agree with the rather sweeping conclusion
in the opinion of Justice Escolin that presidential
decrees and executive acts not thus previously
published in the Official Gazette would be devoid of
any legal character. That would be, in my opinion, to
go too far. It may be fraught, as earlier noted, with
undesirable consequences. I find myself therefore
unable to yield assent to such a pronouncement.
I am authorized to state that Justices Makasiar, Abad
Santos, Cuevas, and Alampay concur in this separate
opinion.
Makasiar, Abad Santos, Cuevas and Alampay, JJ.,
concur.
TEEHANKEE, J., concurring:
I concur with the main opinion of Mr. Justice Escolin
and the concurring opinion of Mme. Justice Herrera.
The Rule of Law connotes a body of norms and laws
published and ascertainable and of equal application to
all similarly circumstances and not subject to arbitrary
change but only under certain set procedures. The
Court has consistently stressed that "it is an
elementary rule of fair play and justice that a
reasonable opportunity to be informed must be
afforded to the people who are commanded to obey
before they can be punished for its violation, 1 citing the
settled principle based on due process enunciated in
earlier cases that "before the public is bound by its
contents, especially its penal provisions, a law,
regulation or circular must first be published and the
people officially and specially informed of said contents
and its penalties.
Without official publication in the Official Gazette as
required by Article 2 of the Civil Code and the Revised
Administrative Code, there would be no basis nor
justification for the corollary rule of Article 3 of the Civil
Code (based on constructive notice that the provisions
of the law are ascertainable from the public and official
repository where they are duly published) that
"Ignorance of the law excuses no one from compliance
therewith.
Respondents' contention based on a misreading of
Article 2 of the Civil Code that "only laws which are
silent as to their effectivity [date] need be published in
the Official Gazette for their effectivity" is manifestly
untenable. The plain text and meaning of the Civil
Code is that "laws shall take effect after fifteen days
following the completion of their publication in the
Official Gazette, unless it is otherwise provided, " i.e. a
different effectivity date is provided by the law itself.
This proviso perforce refers to a law that has been duly
published pursuant to the basic constitutional
requirements of due process. The best example of this
is the Civil Code itself: the same Article 2 provides
otherwise that it "shall take effect [only] one year [not
15 days] after such publication. 2 To sustain
respondents' misreading that "most laws or decrees
specify the date of their effectivity and for this reason,
publication in the Official Gazette is not necessary for
their effectivity 3 would be to nullify and render
nugatory the Civil Code's indispensable and essential
requirement of prior publication in the Official Gazette
by the simple expedient of providing for immediate
effectivity or an earlier effectivity date in the law
itself before the completion of 15 days following its
publication which is the period generally fixed by the
Civil Code for its proper dissemination.
MELENCIO-HERRERA, J., concurring:
I agree. There cannot be any question but that even if
a decree provides for a date of effectivity, it has to be
published. What I would like to state in connection with
that proposition is that when a date of effectivity is
mentioned in the decree but the decree becomes
effective only fifteen (15) days after its publication in
the Official Gazette, it will not mean that the decree can
have retroactive effect to the date of effectivity
mentioned in the decree itself. There should be no
retroactivity if the retroactivity will run counter to
constitutional rights or shall destroy vested rights.
PLANA, J., concurring (with qualification):
The Philippine Constitution does not require the
publication of laws as a prerequisite for their effectivity,
unlike some Constitutions elsewhere. * It may be said
though that the guarantee of due process requires
notice of laws to affected parties before they can be
bound thereby; but such notice is not necessarily by
publication in the Official Gazette. The due process
clause is not that precise. Neither is the publication of
laws in the Official Gazette required by any statute as a
prerequisite for their effectivity, if said laws already
provide for their effectivity date.
Article 2 of the Civil Code provides that "laws shall take
effect after fifteen days following the completion of their
publication in the Official Gazette, unless it is otherwise
provided " Two things may be said of this provision:
7
Firstly, it obviously does not apply to a law with a built-
in provision as to when it will take effect. Secondly, it
clearly recognizes that each law may provide not only
a different period for reckoning its effectivity date but
also a different mode of notice. Thus, a law may
prescribe that it shall be published elsewhere than in
the Official Gazette.
Commonwealth Act No. 638, in my opinion, does not
support the proposition that for their effectivity, laws
must be published in the Official Gazette. The said law
is simply "An Act to Provide for the Uniform Publication
and Distribution of the Official Gazette." Conformably
therewith, it authorizes the publication of the Official
Gazette, determines its frequency, provides for its sale
and distribution, and defines the authority of the
Director of Printing in relation thereto. It also
enumerates what shall be published in the Official
Gazette, among them, "important legislative acts and
resolutions of a public nature of the Congress of the
Philippines" and "all executive and administrative
orders and proclamations, except such as have no
general applicability." It is noteworthy that not all
legislative acts are required to be published in the
Official Gazette but only "important" ones "of a public
nature." Moreover, the said law does not provide that
publication in the Official Gazette is essential for the
effectivity of laws. This is as it should be, for all statutes
are equal and stand on the same footing. A law,
especially an earlier one of general application such as
Commonwealth Act No. 638, cannot nullify or restrict
the operation of a subsequent statute that has a
provision of its own as to when and how it will take
effect. Only a higher law, which is the Constitution, can
assume that role.
In fine, I concur in the majority decision to the extent
that it requires notice before laws become effective, for
no person should be bound by a law without notice.
This is elementary fairness. However, I beg to disagree
insofar as it holds that such notice shall be by
publication in the Official Gazette.
Cuevas and Alampay, JJ., concur.
GUTIERREZ, Jr., J., concurring:
I concur insofar as publication is necessary but reserve
my vote as to the necessity of such publication being
in the Official Gazette.
DE LA FUENTE, J., concurring:
I concur insofar as the opinion declares the
unpublished decrees and issuances of a public nature
or general applicability ineffective, until due publication
thereof.
Footnotes
1 Section 6. The right of the people
to information on matters of public
concern shag be recognized, access
to official records, and to documents
and papers pertaining to official acts,
transactions, or decisions, shag be
afforded the citizens subject to such
limitation as may be provided by law.
2 Anti-Chinese League vs. Felix, 77
Phil. 1012; Costas vs. Aidanese, 45
Phil. 345; Almario vs. City Mayor, 16
SCRA 151;Parting vs. San Jose
Petroleum, 18 SCRA 924; Dumlao
vs. Comelec, 95 SCRA 392.
3 16 Phil. 366, 378.
4 Camacho vs. Court of Industrial
Relations, 80 Phil 848; Mejia vs.
Balolong, 81 Phil. 486; Republic of
the Philippines vs. Encamacion, 87
Phil. 843; Philippine Blooming Mills,
Inc. vs. Social Security System, 17
SCRA 1077; Askay vs. Cosalan, 46
Phil. 179.
5 1 Manresa, Codigo Civil 7th Ed., p.
146.
6 People vs. Que Po Lay, 94 Phil.
640; Balbuena et al. vs. Secretary of
Education, et al., 110 Phil. 150.
7 82 SCRA 30, dissenting opinion.
8 308 U.S. 371, 374.
9 93 Phil.. 68,.
10 The report was prepared by the
Clerk of Court after Acting Director
Florendo S. Pablo Jr. of the
Government Printing Office, failed to
respond to her letter-request
regarding the respective dates of
publication in the Official Gazette of
the presidential issuances listed
therein. No report has been
submitted by the Clerk of Court as to
the publication or non-publication of
other presidential issuances.
11 129 SCRA 174.
Fernando, CJ.:
1 Separate Opinion of Justice Plana,
first paragraph. He mentioned in tills
connection Article 7, Sec. 21 of the
Wisconsin Constitution and State ex
rel. White v. Grand Superior Ct., 71
ALR 1354, citing the Constitution of
Indiana, U.S.A
2 Ibid, closing paragraph.
3 Learned Hand, The Spirit of Liberty
104 (1960).
4 Cardozo, The Growth of the Law,
3 (1924).
8
5 Cf. Nunez v. Sandiganbayan, G.R.
No. 50581-50617, January 30,
1982, 111 SCRA 433.

6 Cf. Alalayan v. National Power

Corporation, L-24396, July 29, 1968,
24 SCRA 172.

Teehankee, J.:

1 People vs. de Dios, G.R. No.

11003, Aug. 3l, 1959, per the late
Chief Justice Paras.

2 Notes in brackets supplied.

3 Respondents: comment, pp. 14-

15.

Plana, J.:

* See e.g., Wisconsin Constitution,

Art. 7, Sec. 21: "The legislature shall
provide publication of all statute laws
... and no general law shall be in
force until published." See also S ate
ex rel. White vs. Grand Superior Ct.,
71 ALR 1354, citing Constitution of
Indiana, U.S.A.

Republic of the Philippines

SUPREME COURT
Manila

THIRD DIVISION

9
G.R. No. 80718 January 29, 1988
FELIZA P. DE ROY and VIRGILIO
RAMOS, petitioners,
vs.
COURT OF APPEALS and LUIS BERNAL, SR.,
GLENIA BERNAL, LUIS BERNAL, JR., HEIRS OF
MARISSA BERNAL, namely, GLICERIA DELA
CRUZ BERNAL and LUIS BERNAL,
SR., respondents.
RESOLUTION
CORTES, J.:
This special civil action for certiorari seeks to declare
null and void two (2) resolutions of the Special First
Division of the Court of Appeals in the case of Luis
Bernal, Sr., et al. v. Felisa Perdosa De Roy, et al., CA-
G.R. CV No. 07286. The first resolution promulgated
on 30 September 1987 denied petitioners' motion for
extension of time to file a motion for reconsideration
and directed entry of judgment since the decision in
said case had become final; and the second Resolution
dated 27 October 1987 denied petitioners' motion for
reconsideration for having been filed out of time.
At the outset, this Court could have denied the petition
outright for not being verified as required by Rule 65
section 1 of the Rules of Court. However, even if the
instant petition did not suffer from this defect, this
Court, on procedural and substantive grounds, would
still resolve to deny it.
The facts of the case are undisputed. The firewall of a
burned-out building owned by petitioners collapsed
and destroyed the tailoring shop occupied by the family
of private respondents, resulting in injuries to private
respondents and the death of Marissa Bernal, a
daughter. Private respondents had been warned by
petitioners to vacate their shop in view of its proximity
to the weakened wall but the former failed to do so. On
the basis of the foregoing facts, the Regional Trial
Court. First Judicial Region, Branch XXXVIII, presided
by the Hon. Antonio M. Belen, rendered judgment
finding petitioners guilty of gross negligence and
awarding damages to private respondents. On appeal,
the decision of the trial court was affirmed in toto by the
Court of Appeals in a decision promulgated on August
17, 1987, a copy of which was received by petitioners
on August 25, 1987. On September 9, 1987, the last
day of the fifteen-day period to file an appeal,
petitioners filed a motion for extension of time to file a
motion for reconsideration, which was eventually
denied by the appellate court in the Resolution of
September 30, 1987. Petitioners filed their motion for
reconsideration on September 24, 1987 but this was
denied in the Resolution of October 27, 1987.
This Court finds that the Court of Appeals did not
commit a grave abuse of discretion when it denied
petitioners' motion for extension of time to file a motion
for reconsideration, directed entry of judgment and
denied their motion for reconsideration. It correctly
applied the rule laid down in Habaluyas Enterprises,
Inc. v. Japzon, [G.R. No. 70895, August 5, 1985,138
SCRA 461, that the fifteen-day period for appealing or
for filing a motion for reconsideration cannot be
extended. In its Resolution denying the motion for
reconsideration, promulgated on July 30, 1986 (142
SCRA 208), this Court en banc restated and clarified
the rule, to wit:
Beginning one month after the promulgation of this
Resolution, the rule shall be strictly enforced that no
motion for extension of time to file a motion for
reconsideration may be filed with the Metropolitan or
Municipal Trial Courts, the Regional Trial Courts, and
the Intermediate Appellate Court. Such a motion may
be filed only in cases pending with the Supreme Court
as the court of last resort, which may in its sound
discretion either grant or deny the extension requested.
(at p. 212)
Lacsamana v. Second Special Cases Division of the
intermediate Appellate Court, [G.R. No. 73146-53,
August 26, 1986, 143 SCRA 643], reiterated the rule
and went further to restate and clarify the modes and
periods of appeal.
Bacaya v. Intermediate Appellate Court, [G.R. No.
74824, Sept. 15, 1986,144 SCRA 161],stressed the
prospective application of said rule, and explained the
operation of the grace period, to wit:
In other words, there is a one-month grace period from
the promulgation on May 30, 1986 of the Court's
Resolution in the clarificatory Habaluyas case, or up to
June 30, 1986, within which the rule barring extensions
of time to file motions for new trial or reconsideration is,
as yet, not strictly enforceable.
Since petitioners herein filed their motion for extension
on February 27, 1986, it is still within the grace period,
which expired on June 30, 1986, and may still be
allowed.
This grace period was also applied in Mission v.
Intermediate Appellate Court [G.R. No. 73669, October
28, 1986, 145 SCRA 306].]
In the instant case, however, petitioners' motion for
extension of time was filed on September 9, 1987,
more than a year after the expiration of the grace
period on June 30, 1986. Hence, it is no longer within
the coverage of the grace period. Considering the
length of time from the expiration of the grace period to
the promulgation of the decision of the Court of
Appeals on August 25, 1987, petitioners cannot seek
refuge in the ignorance of their counsel regarding said
rule for their failure to file a motion for reconsideration
within the reglementary period.
Petitioners contend that the rule enunciated in
the Habaluyas case should not be made to apply to the
case at bar owing to the non-publication of
the Habaluyas decision in the Official Gazette as of the
time the subject decision of the Court of Appeals was
promulgated. Contrary to petitioners' view, there is no
law requiring the publication of Supreme Court
decisions in the Official Gazette before they can be
binding and as a condition to their becoming effective.
It is the bounden duty of counsel as lawyer in active law
practice to keep abreast of decisions of the Supreme
Court particularly where issues have been clarified,
consistently reiterated, and published in the advance
reports of Supreme Court decisions (G. R. s) and in
such publications as the Supreme Court Reports
Annotated (SCRA) and law journals.
10
This Court likewise finds that the Court of Appeals
committed no grave abuse of discretion in affirming the
trial court's decision holding petitioner liable under
Article 2190 of the Civil Code, which provides that "the
proprietor of a building or structure is responsible for
the damage resulting from its total or partial collapse, if
it should be due to the lack of necessary repairs.

Nor was there error in rejecting petitioners argument

that private respondents had the "last clear chance" to
avoid the accident if only they heeded the. warning to
vacate the tailoring shop and , therefore, petitioners
prior negligence should be disregarded, since the
doctrine of "last clear chance," which has been applied
to vehicular accidents, is inapplicable to this case.

WHEREFORE, in view of the foregoing, the Court

Resolved to DENY the instant petition for lack of merit.

Fernan (Chairman), Gutierrez, Jr., Feliciano and Bidin,

JJ., concur.

11
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
A.M. No. MTJ-92-706 March 29, 1995
LUPO ALMODIEL ATIENZA, complainant,
vs.
JUDGE FRANCISCO F. BRILLANTES, JR.,
Metropolitan Trial Court, Branch 28,
Manila, respondent.
QUIASON, J.:
This is a complaint by Lupo A. Atienza for Gross
Immorality and Appearance of Impropriety against
Judge Francisco Brillantes, Jr., Presiding Judge of the
Metropolitan Trial Court, Branch 20, Manila.
Complainant alleges that he has two children with
Yolanda De Castro, who are living together at No. 34
Galaxy Street, Bel-Air Subdivision, Makati, Metro
Manila. He stays in said house, which he purchased in
1987, whenever he is in Manila.
In December 1991, upon opening the door to his
bedroom, he saw respondent sleeping on his
(complainant's) bed. Upon inquiry, he was told by the
houseboy that respondent had been cohabiting with De
Castro. Complainant did not bother to wake up
respondent and instead left the house after giving
instructions to his houseboy to take care of his children.
Thereafter, respondent prevented him from visiting his
children and even alienated the affection of his children
for him.
Complainant claims that respondent is married to one
Zenaida Ongkiko with whom he has five children, as
appearing in his 1986 and 1991 sworn statements of
assets and liabilities. Furthermore, he alleges that
respondent caused his arrest on January 13, 1992,
after he had a heated argument with De Castro inside
the latter's office.
For his part, respondent alleges that complainant was
not married to De Castro and that the filing of the
administrative action was related to complainant's
claim on the Bel-Air residence, which was disputed by
De Castro.
Respondent denies that he caused complainant's
arrest and claims that he was even a witness to the
withdrawal of the complaint for Grave Slander filed by
De Castro against complainant. According to him, it
was the sister of De Castro who called the police to
arrest complainant.
Respondent also denies having been married to
Ongkiko, although he admits having five children with
her. He alleges that while he and Ongkiko went through
a marriage ceremony before a Nueva Ecija town mayor
on April 25, 1965, the same was not a valid marriage
for lack of a marriage license. Upon the request of the
parents of Ongkiko, respondent went through another
marriage ceremony with her in Manila on June 5, 1965.
Again, neither party applied for a marriage license.
Ongkiko abandoned respondent 17 years ago, leaving
their children to his care and custody as a single
parent.
Respondent claims that when he married De Castro in
civil rites in Los Angeles, California on December 4,
1991, he believed, in all good faith and for all legal
intents and purposes, that he was single because his
first marriage was solemnized without a license.
Under the Family Code, there must be a judicial
declaration of the nullity of a previous marriage before
a party thereto can enter into a second marriage.
Article 40 of said Code provides:
The absolute nullity of a previous marriage may be
invoked for the purposes of remarriage on the basis
solely of a final judgment declaring such previous
marriage void.
Respondent argues that the provision of Article 40 of
the Family Code does not apply to him considering that
his first marriage took place in 1965 and was governed
by the Civil Code of the Philippines; while the second
marriage took place in 1991 and governed by the
Family Code.
Article 40 is applicable to remarriages entered into after
the effectivity of the Family Code on August 3, 1988
regardless of the date of the first marriage. Besides,
under Article 256 of the Family Code, said Article is
given "retroactive effect insofar as it does not prejudice
or impair vested or acquired rights in accordance with
the Civil Code or other laws." This is particularly true
with Article 40, which is a rule of procedure.
Respondent has not shown any vested right that was
impaired by the application of Article 40 to his case.
The fact that procedural statutes may somehow affect
the litigants' rights may not preclude their retroactive
application to pending actions. The retroactive
application of procedural laws is not violative of any
right of a person who may feel that he is adversely
affected (Gregorio v. Court of Appeals, 26 SCRA 229
[1968]). The reason is that as a general rule no vested
right may attach to, nor arise from, procedural laws
(Billones v. Court of Industrial Relations, 14 SCRA 674
[1965]).
Respondent is the last person allowed to invoke good
faith. He made a mockery of the institution of marriage
and employed deceit to be able to cohabit with a
woman, who beget him five children.
Respondent passed the Bar examinations in 1962 and
was admitted to the practice of law in 1963. At the time
he went through the two marriage ceremonies with
Ongkiko, he was already a lawyer. Yet, he never
secured any marriage license. Any law student would
know that a marriage license is necessary before one
can get married. Respondent was given an opportunity
to correct the flaw in his first marriage when he and
Ongkiko were married for the second time. His failure
to secure a marriage license on these two occasions
betrays his sinister motives and bad faith.
12
It is evident that respondent failed to meet the standard
of moral fitness for membership in the legal profession.

While the deceit employed by respondent existed prior

to his appointment as a Metropolitan Trial Judge, his
immoral and illegal act of cohabiting with De Castro
began and continued when he was already in the
judiciary.

The Code of Judicial Ethics mandates that the conduct

of a judge must be free of a whiff of impropriety, not
only with respect to his performance of his judicial
duties but also as to his behavior as a private
individual. There is no duality of morality. A public
figure is also judged by his private life. A judge, in order
to promote public confidence in the integrity and
impartiality of the judiciary, must behave with propriety
at all times, in the performance of his judicial duties and
in his everyday life. These are judicial guideposts too
self-evident to be overlooked. No position exacts a
greater demand on moral righteousness and
uprightness of an individual than a seat in the judiciary
(Imbing v. Tiongzon, 229 SCRA 690 [1994]).

WHEREFORE, respondent is DISMISSED from the

service with forfeiture of all leave and retirement
benefits and with prejudice to reappointment in any
branch, instrumentality, or agency of the government,
including government-owned and controlled
corporations. This decision is immediately executory.

SO ORDERED.

Narvasa, C.J., Feliciano, Padilla, Bidin, Regalado,

Davide, Jr., Romero, Bellosillo, Melo, Puno, Vitug,
Kapunan, Mendoza and Francisco, JJ., concur.

13

Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 179922 December 16, 2008
JUAN DE DIOS CARLOS, petitioner,
vs.
FELICIDAD SANDOVAL, also known as
FELICIDAD S. VDA. DE CARLOS or FELICIDAD
SANDOVAL CARLOS or FELICIDAD SANDOVAL
VDA. DE CARLOS, and TEOFILO CARLOS
II, respondents.
DECISION
REYES, R.T., J.:
ONLY a spouse can initiate an action to sever the
marital bond for marriages solemnized during the
effectivity of the Family Code, except cases
commenced prior to March 15, 2003. The nullity and
annulment of a marriage cannot be declared in a
judgment on the pleadings, summary judgment, or
confession of judgment.
We pronounce these principles as We review
on certiorari the Decision1 of the Court of Appeals (CA)
which reversed and set aside the summary
judgment2 of the Regional Trial Court (RTC) in an
action for declaration of nullity of marriage, status of a
child, recovery of property, reconveyance, sum of
money, and damages.
The Facts
The events that led to the institution of the instant
suitare unveiled as follows:
Spouses Felix B. Carlos and Felipa Elemia died
intestate. They left six parcels of land to their
compulsory heirs, Teofilo Carlos and petitioner Juan
De Dios Carlos. The lots are particularly described as
follows:
Parcel No. 1
Lot No. 162 of the MUNTINLUPA ESTATE
SUBDIVISION, Case No. 6137 of the Court of Land
Registration.
Exemption from the provisions of Article 567 of the Civil
Code is specifically reserved.
Area: 1 hectare, 06 ares, 07 centares.
Parcel No. 2
A parcel of land (Lot No. 159-B), being a portion of Lot
159, situated in the Bo. of Alabang, Municipality of
Muntinlupa, Province of Rizal, x x x containing an area
of Thirteen Thousand Four Hundred Forty One
(13,441) square meters.
Parcel No. 3
A parcel of land (Lot 159-B-2 of the subd. plan [LRC]
Psd-325903, approved as a non-subd. project), being
a portion of Lot 159-B [LRC] Psd- Alabang, Mun. of
Muntinlupa, Metro Manila, Island of Luzon. Bounded
on the NE, points 2 to 4 by Lot 155, Muntinlupa Estate;
on the SE, point 4 to 5 by Lot 159-B-5; on the S, points
5 to 1 by Lot 159-B-3; on the W, points 1 to 2 by Lot
159-B-1 (Road widening) all of the subd. plan,
containing an area of ONE HUNDRED THIRTY (130)
SQ. METERS, more or less.
PARCEL No. 4
A parcel of land (Lot 28-C of the subd. plan Psd-13-
007090, being a portion of Lot 28, Muntinlupa Estate,
L.R.C. Rec. No. 6137), situated in the Bo. of Alabang,
Mun. of Muntinlupa, Metro Manila. Bounded on the NE,
along lines 1-2 by Lot 27, Muntinlupa Estate; on the
East & SE, along lines 2 to 6 by Mangangata River; and
on the West., along line 6-1, by Lot 28-B of the subd.
plan x x x containing an area of ONE THUSAND AND
SEVENTY-SIX (1,076) SQUARE METERS.
PARCEL No. 5
PARCELA DE TERRENO No. 50, Manzana No. 18, de
la subd. de Solocan. Linda por el NW, con la parcela
49; por el NE, con la parcela 36; por el SE, con la
parcela 51; y por el SW, con la calle Dos Castillas.
Partiendo de un punto marcado 1 en el plano, el cual
se halla a S. gds. 01'W, 72.50 mts. Desde el punto 1
de esta manzana, que es un mojon de concreto de la
Ciudad de Manila, situado on el esquina E. que forman
las Calles Laong Laan y Dos. Castillas, continiendo un
extension superficial de CIENTO CINCUENTA (150)
METROS CUADRADOS.
PARCEL No. 6
PARCELA DE TERRENO No. 51, Manzana No. 18, de
la subd. De Solocon. Linda por el NW, con la parcela
50; por el NE, con la parcela 37; por el SE, con la
parcela 52; por el SW, con la Calle Dos Castillas.
Partiendo de un punto Marcado 1 en el plano, el cual
se halla at S. 43 gds. 01'E, 82.50 mts. Desde el punto
1 de esta manzana, que es un mojon de concreto de
la Ciudad de Manila, situado on el esquina E. que
forman las Calles Laong Laan y Dos. Castillas,
continiendo una extension superficial de CIENTO
CINCUENTA (150) METROS CUADRADOS.3
During the lifetime of Felix Carlos, he agreed to transfer
his estate to Teofilo. The agreement was made in order
to avoid the payment of inheritance taxes. Teofilo, in
turn, undertook to deliver and turn over the share of the
other legal heir, petitioner Juan De Dios Carlos.
Eventually, the first three (3) parcels of land were
transferred and registered in the name of Teofilo.
These three (3) lots are now covered by Transfer
Certificate of Title (TCT) No. 234824 issued by the
Registry of Deeds of Makati City; TCT No. 139061
issued by the Registry of Deeds of Makati City; and
TCT No. 139058 issued by the Registry of Deeds of
Makati City.
Parcel No. 4 was registered in the name of petitioner.
The lot is now covered by TCT No. 160401 issued by
the Registry of Deeds of Makati City.
On May 13, 1992, Teofilo died intestate. He was
survived by respondents Felicidad and their son,
Teofilo Carlos II (Teofilo II). Upon Teofilo's death,
Parcel Nos. 5 & 6 were registered in the name of
respondent Felicidad and co-respondent, Teofilo II.
The said two (2) parcels of land are covered by TCT
14
Nos. 219877 and 210878, respectively, issued by the
Registry of Deeds of Manila.
In 1994, petitioner instituted a suit against respondents
before the RTC in Muntinlupa City, docketed as Civil
Case No. 94-1964. In the said case, the parties
submitted and caused the approval of a partial
compromise agreement. Under the compromise, the
parties acknowledged their respective shares in the
proceeds from the sale of a portion of the first parcel of
land. This includes the remaining 6,691-square-meter
portion of said land.
On September 17, 1994, the parties executed a deed
of extrajudicial partition, dividing the remaining land of
the first parcel between them.
Meanwhile, in a separate case entitled Rillo v.
Carlos,4 2,331 square meters of the second parcel of
land were adjudicated in favor of plaintiffs Rillo. The
remaining 10,000-square meter portion was later
divided between petitioner and respondents.
The division was incorporated in a supplemental
compromise agreement executed on August 17, 1994,
with respect to Civil Case No. 94-1964. The parties
submitted the supplemental compromise agreement,
which was approved accordingly.
Petitioner and respondents entered into two more
contracts in August 1994. Under the contracts, the
parties equally divided between them the third and
fourth parcels of land.
In August 1995, petitioner commenced an action,
docketed as Civil Case No. 95-135, against
respondents before the court a quo with the following
causes of action: (a) declaration of nullity of marriage;
(b) status of a child; (c) recovery of property; (d)
reconveyance; and (e) sum of money and damages.
The complaint was raffled to Branch 256 of the RTC in
Muntinlupa.
In his complaint, petitioner asserted that the marriage
between his late brother Teofilo and respondent
Felicidad was a nullity in view of the absence of the
required marriage license. He likewise maintained that
his deceased brother was neither the natural nor the
adoptive father of respondent Teofilo Carlos II.
Petitioner likewise sought the avoidance of the
contracts he entered into with respondent Felicidad
with respect to the subject real properties. He also
prayed for the cancellation of the certificates of title
issued in the name of respondents. He argued that the
properties covered by such certificates of title,
including the sums received by respondents as
proceeds, should be reconveyed to him.
Finally, petitioner claimed indemnification as and by
way of moral and exemplary damages, attorney's fees,
litigation expenses, and costs of suit.
On October 16, 1995, respondents submitted their
answer. They denied the material averments of
petitioner's complaint. Respondents contended that
the dearth of details regarding the requisite marriage
license did not invalidate Felicidad's marriage to
Teofilo. Respondents declared that Teofilo II was the
illegitimate child of the deceased Teofilo Carlos with
another woman.
On the grounds of lack of cause of action and lack of
jurisdiction over the subject matter, respondents
prayed for the dismissal of the case before the trial
court. They also asked that their counterclaims for
moral and exemplary damages, as well as attorney's
fees, be granted.
But before the parties could even proceed to pre-trial,
respondents moved for summary judgment. Attached
to the motion was the affidavit of the justice of the
peace who solemnized the marriage. Respondents
also submitted the Certificate of Live Birth of
respondent Teofilo II. In the certificate, the late Teofilo
Carlos and respondent Felicidad were designated as
parents.
On January 5, 1996, petitioner opposed the motion for
summary judgment on the ground of irregularity of the
contract evidencing the marriage. In the same breath,
petitioner lodged his own motion for summary
judgment. Petitioner presented a certification from the
Local Civil Registrar of Calumpit, Bulacan, certifying
that there is no record of birth of respondent Teofilo II.
Petitioner also incorporated in the counter-motion for
summary judgment the testimony of respondent
Felicidad in another case. Said testimony was made in
Civil Case No. 89-2384, entitled Carlos v. Gorospe,
before the RTC Branch 255, Las Piñas. In her
testimony, respondent Felicidad narrated that co-
respondent Teofilo II is her child with Teofilo.5
Subsequently, the Office of the City Prosecutor of
Muntinlupa submitted to the trial court its report and
manifestation, discounting the possibility of collusion
between the parties.
RTC and CA Dispositions
On April 8, 1996, the RTC rendered judgment,
disposing as follows:
WHEREFORE, premises considered, defendant's
(respondent's) Motion for Summary Judgment is
hereby denied. Plaintiff's (petitioner's) Counter-Motion
for Summary Judgment is hereby granted and
summary judgment is hereby rendered in favor of
plaintiff as follows:
1. Declaring the marriage between defendant Felicidad
Sandoval and Teofilo Carlos solemnized at Silang,
Cavite on May 14, 1962, evidenced by the Marriage
Certificate submitted in this case, null and void ab initio
for lack of the requisite marriage license;
2. Declaring that the defendant minor, Teofilo S. Carlos
II, is not the natural, illegitimate, or legally adopted child
of the late Teofilo E. Carlos;
3. Ordering defendant Sandoval to pay and restitute to
plaintiff the sum of P18,924,800.00 together with the
interest thereon at the legal rate from date of filing of
the instant complaint until fully paid;
4. Declaring plaintiff as the sole and exclusive owner of
the parcel of land, less the portion adjudicated to
plaintiffs in Civil Case No. 11975, covered by TCT No.
139061 of the Register of Deeds of Makati City, and
ordering said Register of Deeds to cancel said title and
to issue another title in the sole name of plaintiff herein;
5. Declaring the Contract, Annex "K" of complaint,
between plaintiff and defendant Sandoval null and
void, and ordering the Register of Deeds of Makati City
to cancel TCT No. 139058 in the name of Teofilo
Carlos, and to issue another title in the sole name of
plaintiff herein;
15
6. Declaring the Contract, Annex M of the complaint,
between plaintiff and defendant Sandoval null and
void;
7. Ordering the cancellation of TCT No. 210877 in the
names of defendant Sandoval and defendant minor
Teofilo S. Carlos II and ordering the Register of Deeds
of Manila to issue another title in the exclusive name of
plaintiff herein;
8. Ordering the cancellation of TCT No. 210878 in the
name of defendant Sandoval and defendant Minor
Teofilo S. Carlos II and ordering the Register of Deeds
of Manila to issue another title in the sole name of
plaintiff herein.
Let this case be set for hearing for the reception of
plaintiff's evidence on his claim for moral damages,
exemplary damages, attorney's fees, appearance fees,
and litigation expenses on June 7, 1996 at 1:30 o'clock
in the afternoon.
SO ORDERED.6
Dissatisfied, respondents appealed to the CA. In the
appeal, respondents argued, inter alia, that the trial
court acted without or in excess of jurisdiction in
rendering summary judgment annulling the marriage of
Teofilo, Sr. and Felicidad and in declaring Teofilo II as
not an illegitimate child of Teofilo, Sr.
On October 15, 2002, the CA reversed and set aside
the RTC ruling, disposing as follows:
WHEREFORE, the summary judgment appealed from
is REVERSED and SET ASIDE and in lieu thereof, a
new one is entered REMANDING the case to the court
of origin for further proceedings.
SO ORDERED.7
The CA opined:
We find the rendition of the herein appealed summary
judgment by the court a quo contrary to law and public
policy as ensconced in the aforesaid safeguards. The
fact that it was appellants who first sought summary
judgment from the trial court, did not justify the grant
thereof in favor of appellee. Not being an action "to
recover upon a claim" or "to obtain a declaratory relief,"
the rule on summary judgment apply (sic) to an action
to annul a marriage. The mere fact that no genuine
issue was presented and the desire to expedite the
disposition of the case cannot justify a
misinterpretation of the rule. The first paragraph of
Article 88 and 101 of the Civil Code expressly prohibit
the rendition of decree of annulment of a marriage
upon a stipulation of facts or a confession of judgment.
Yet, the affidavits annexed to the petition for summary
judgment practically amount to these methods
explicitly proscribed by the law.
We are not unmindful of appellee's argument that the
foregoing safeguards have traditionally been applied to
prevent collusion of spouses in the matter of
dissolution of marriages and that the death of Teofilo
Carlos on May 13, 1992 had effectively dissolved the
marriage herein impugned. The fact, however, that
appellee's own brother and appellant Felicidad
Sandoval lived together as husband and wife for thirty
years and that the annulment of their marriage is the
very means by which the latter is sought to be deprived
of her participation in the estate left by the former call
for a closer and more thorough inquiry into the
circumstances surrounding the case. Rather that the
summary nature by which the court a quo resolved the
issues in the case, the rule is to the effect that the
material facts alleged in the complaint for annulment of
marriage should always be proved. Section 1, Rule 19
of the Revised Rules of Court provides:
"Section 1. Judgment on the pleadings. - Where an
answer fails to tender an issue, or otherwise admits the
material allegations of the adverse party's pleading, the
court may, on motion of that party, direct judgment on
such pleading. But in actions for annulment of marriage
or for legal separation, the material facts alleged in the
complaint shall always be proved." (Underscoring
supplied)
Moreover, even if We were to sustain the applicability
of the rules on summary judgment to the case at bench,
Our perusal of the record shows that the finding of the
court a quo for appellee would still not be warranted.
While it may be readily conceded that a valid marriage
license is among the formal requisites of marriage, the
absence of which renders the marriage void ab
initio pursuant to Article 80(3) in relation to Article 58 of
the Civil Code the failure to reflect the serial number of
the marriage license on the marriage contract
evidencing the marriage between Teofilo Carlos and
appellant Felicidad Sandoval, although irregular, is not
as fatal as appellee represents it to be. Aside from the
dearth of evidence to the contrary, appellant Felicidad
Sandoval's affirmation of the existence of said
marriage license is corroborated by the following
statement in the affidavit executed by Godofredo
Fojas, then Justice of the Peace who officiated the
impugned marriage, to wit:
"That as far as I could remember, there was a marriage
license issued at Silang, Cavite on May 14, 1962 as
basis of the said marriage contract executed by Teofilo
Carlos and Felicidad Sandoval, but the number of said
marriage license was inadvertently not placed in the
marriage contract for the reason that it was the Office
Clerk who filled up the blanks in the Marriage Contract
who in turn, may have overlooked the same."
Rather than the inferences merely drawn by the trial
court, We are of the considered view that the veracity
and credibility of the foregoing statement as well as the
motivations underlying the same should be properly
threshed out in a trial of the case on the merits.
If the non-presentation of the marriage contract - the
primary evidence of marriage - is not proof that a
marriage did not take place, neither should appellants'
non-presentation of the subject marriage license be
taken as proof that the same was not procured. The
burden of proof to show the nullity of the marriage, it
must be emphasized, rests upon the plaintiff and any
doubt should be resolved in favor of the validity of the
marriage.
Considering that the burden of proof also rests on the
party who disputes the legitimacy of a particular party,
the same may be said of the trial court's rejection of the
relationship between appellant Teofilo Carlos II and his
putative father on the basis of the inconsistencies in
appellant Felicidad Sandoval's statements. Although it
had effectively disavowed appellant's prior claims
regarding the legitimacy of appellant Teofilo Carlos II,
the averment in the answer that he is the illegitimate
son of appellee's brother, to Our mind, did not
altogether foreclose the possibility of the said
appellant's illegitimate filiation, his right to prove the
same or, for that matter, his entitlement to inheritance
rights as such.
16
Without trial on the merits having been conducted in
the case, We find appellee's bare allegation that
appellant Teofilo Carlos II was merely purchased from
an indigent couple by appellant Felicidad Sandoval, on
the whole, insufficient to support what could well be a
minor's total forfeiture of the rights arising from his
putative filiation. Inconsistent though it may be to her
previous statements, appellant Felicidad Sandoval's
declaration regarding the illegitimate filiation of Teofilo
Carlos II is more credible when considered in the light
of the fact that, during the last eight years of his life,
Teofilo Carlos allowed said appellant the use of his
name and the shelter of his household. The least that
the trial court could have done in the premises was to
conduct a trial on the merits in order to be able to
thoroughly resolve the issues pertaining to the filiation
of appellant Teofilo Carlos II.8
On November 22, 2006, petitioner moved for
reconsideration and for the inhibition of the ponente,
Justice Rebecca De Guia-Salvador. The CA denied the
twin motions.
Issues
In this petition under Rule 45, petitioner hoists the
following issues:
1. That, in reversing and setting aside the Summary
Judgment under the Decision, Annex A hereof, and in
denying petitioner's Motion for reconsideration under
the Resolution, Annex F hereof, with respect to the
nullity of the impugned marriage, petitioner respectfully
submits that the Court of Appeals committed a grave
reversible error in applying Articles 88 and 101 of the
Civil Code, despite the fact that the circumstances of
this case are different from that contemplated and
intended by law, or has otherwise decided a question
of substance not theretofore decided by the Supreme
Court, or has decided it in a manner probably not in
accord with law or with the applicable decisions of this
Honorable Court;
2. That in setting aside and reversing the Summary
Judgment and, in lieu thereof, entering another
remanding the case to the court of origin for further
proceedings, petitioner most respectfully submits that
the Court of Appeals committed a serious
reversible error in applying Section 1, Rule 19 (now
Section 1, Rule 34) of the Rules of Court providing for
judgment on the pleadings, instead of Rule 35
governing Summary Judgments;
3. That in reversing and setting aside the Summary
Judgment and, in lieu thereof, entering another
remanding the case to the court of origin for further
proceedings, petitioner most respectfully submits that
the Court of Appeals committed grave abuse of
discretion, disregarded judicial admissions, made
findings on ground of speculations, surmises, and
conjectures, or otherwise committed misapplications of
the laws and misapprehension of the
facts.9 (Underscoring supplied)
Essentially, the Court is tasked to resolve whether a
marriage may be declared void ab initio through a
judgment on the pleadings or a summary judgment and
without the benefit of a trial. But there are other
procedural issues, including the capacity of one who is
not a spouse in bringing the action for nullity of
marriage.
Our Ruling
I. The grounds for declaration of absolute nullity of
marriage must be proved. Neither judgment on the
pleadings nor summary judgment is allowed. So is
confession of judgment disallowed.
Petitioner faults the CA in applying Section 1, Rule
1910 of the Revised Rules of Court, which provides:
SECTION 1. Judgment on the pleadings. - Where an
answer fails to tender an issue, or otherwise admits the
material allegations of the adverse party's pleading, the
court may, on motion of that party, direct judgment on
such pleading. But in actions for annulment of marriage
or for legal separation, the material facts alleged in the
complaint shall always be proved.
He argues that the CA should have applied Rule 35 of
the Rules of Court governing summary judgment,
instead of the rule on judgment on the pleadings.
Petitioner is misguided. The CA did not limit its finding
solely within the provisions of the Rule on judgment on
the pleadings. In disagreeing with the trial court, the CA
likewise considered the provisions on summary
judgments, to wit:
Moreover, even if We are to sustain the applicability of
the rules on summary judgment to the case at bench,
Our perusal of the record shows that the finding of the
court a quo for appellee would still not be warranted. x
x x11
But whether it is based on judgment on the pleadings
or summary judgment, the CA was correct in reversing
the summary judgment rendered by the trial court. Both
the rules on judgment on the pleadings and summary
judgments have no place in cases of declaration of
absolute nullity of marriage and even in annulment of
marriage.
With the advent of A.M. No. 02-11-10-SC, known as
"Rule on Declaration of Absolute Nullity of Void
Marriages and Annulment of Voidable Marriages," the
question on the application of summary judgments or
even judgment on the pleadings in cases of nullity or
annulment of marriage has been stamped with clarity.
The significant principle laid down by the said Rule,
which took effect on March 15, 200312 is found in
Section 17, viz.:
SEC. 17. Trial. - (1) The presiding judge shall
personally conduct the trial of the case. No delegation
of evidence to a commissioner shall be allowed except
as to matters involving property relations of the
spouses.
(2) The grounds for declaration of absolute nullity or
annulment of marriage must be proved. No judgment
on the pleadings, summary judgment, or confession of
judgment shall be allowed. (Underscoring supplied)
Likewise instructive is the Court's pronouncement
in Republic v. Sandiganbayan.13 In that case, We
excluded actions for nullity or annulment of marriage
from the application of summary judgments.
Prescinding from the foregoing discussion, save for
annulment of marriage or declaration of its nullity or for
legal separation, summary judgment is applicable to all
kinds of actions.14 (Underscoring supplied)
By issuing said summary judgment, the trial court has
divested the State of its lawful right and duty to
intervene in the case. The participation of the State is
not terminated by the declaration of the public
prosecutor that no collusion exists between the parties.
The State should have been given the opportunity to
17
present controverting evidence before the judgment
was rendered.15
Both the Civil Code and the Family Code ordain that
the court should order the prosecuting attorney to
appear and intervene for the State. It is at this stage
when the public prosecutor sees to it that there is no
suppression of evidence. Concomitantly, even if there
is no suppression of evidence, the public prosecutor
has to make sure that the evidence to be presented or
laid down before the court is not fabricated.
To further bolster its role towards the preservation of
marriage, the Rule on Declaration of Absolute Nullity of
Void Marriages reiterates the duty of the public
prosecutor, viz.:
SEC. 13. Effect of failure to appear at the pre-trial. - (a)
xxx
(b) x x x If there is no collusion, the court shall require
the public prosecutor to intervene for the State during
the trial on the merits to prevent suppression or
fabrication of evidence. (Underscoring supplied)
Truly, only the active participation of the public
prosecutor or the Solicitor General will ensure that the
interest of the State is represented and protected in
proceedings for declaration of nullity of marriages by
preventing the fabrication or suppression of
evidence.16
II. A petition for declaration of absolute nullity of
void marriage may be filed solely by the husband
or wife. Exceptions: (1) Nullity of marriage cases
commenced before the effectivity of A.M. No. 02-
11-10-SC; and (2) Marriages celebrated during the
effectivity of the Civil Code.
Under the Rule on Declaration of Absolute Nullity of
Void Marriages and Annulment of Voidable
Marriages, the petition for declaration of absolute
nullity of marriage may not be filed by any party outside
of the marriage. The Rule made it exclusively a right of
the spouses by stating:
SEC. 2. Petition for declaration of absolute nullity of
void marriages. -
(a) Who may file. - A petition for declaration of absolute
nullity of void marriage may be filed solely by the
husband or the wife. (Underscoring supplied)
Section 2(a) of the Rule makes it the sole right of the
husband or the wife to file a petition for declaration of
absolute nullity of void marriage. The rationale of the
Rule is enlightening, viz.:
Only an aggrieved or injured spouse may file a petition
for annulment of voidable marriages or declaration of
absolute nullity of void marriages. Such petition cannot
be filed by compulsory or intestate heirs of the spouses
or by the State. The Committee is of the belief that they
do not have a legal right to file the petition.Compulsory
or intestate heirs have only inchoate rights prior to the
death of their predecessor, and, hence, can only
question the validity of the marriage of the spouses
upon the death of a spouse in a proceeding for the
settlement of the estate of the deceased spouse filed
in the regular courts. On the other hand, the concern of
the State is to preserve marriage and not to seek its
dissolution.17 (Underscoring supplied)
The new Rule recognizes that the husband and the
wife are the sole architects of a healthy, loving,
peaceful marriage. They are the only ones who can
decide when and how to build the foundations of
marriage. The spouses alone are the engineers of their
marital life. They are simultaneously the directors and
actors of their matrimonial true-to-life play. Hence, they
alone can and should decide when to take a cut, but
only in accordance with the grounds allowed by law.
The innovation incorporated in A.M. No. 02-11-10-SC
sets forth a demarcation line between marriages
covered by the Family Code and those solemnized
under the Civil Code. The Rule extends only to
marriages entered into during the effectivity of the
Family Code which took effect on August 3, 1988.18
The advent of the Rule on Declaration of Absolute
Nullity of Void Marriages marks the beginning of the
end of the right of the heirs of the deceased spouse to
bring a nullity of marriage case against the surviving
spouse. But the Rule never intended to deprive the
compulsory or intestate heirs of their successional
rights.
While A.M. No. 02-11-10-SC declares that a petition for
declaration of absolute nullity of marriage may be filed
solely by the husband or the wife, it does not mean that
the compulsory or intestate heirs are without any
recourse under the law. They can still protect their
successional right, for, as stated in the Rationale of the
Rules on Annulment of Voidable Marriages and
Declaration of Absolute Nullity of Void Marriages,
compulsory or intestate heirs can still question the
validity of the marriage of the spouses, not in a
proceeding for declaration of nullity but upon the death
of a spouse in a proceeding for the settlement of the
estate of the deceased spouse filed in the regular
courts.19
It is emphasized, however, that the Rule does not apply
to cases already commenced before March 15, 2003
although the marriage involved is within the coverage
of the Family Code. This is so, as the new Rule which
became effective on March 15, 200320 is prospective in
its application. Thus, the Court held in Enrico v. Heirs
of Sps. Medinaceli,21 viz.:
As has been emphasized, A.M. No. 02-11-10-SC
covers marriages under the Family Code of the
Philippines, and is prospective in its
application.22 (Underscoring supplied)
Petitioner commenced the nullity of marriage case
against respondent Felicidad in 1995. The marriage in
controversy was celebrated on May 14, 1962. Which
law would govern depends upon when the marriage
took place.23
The marriage having been solemnized prior to the
effectivity of the Family Code, the applicable law is the
Civil Code which was the law in effect at the time of its
celebration.24 But the Civil Code is silent as to who may
bring an action to declare the marriage void. Does this
mean that any person can bring an action for the
declaration of nullity of marriage?
We respond in the negative. The absence of a
provision in the Civil Code cannot be construed as a
license for any person to institute a nullity of marriage
case. Such person must appear to be 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.25 Elsewise stated, plaintiff must be the real party-
in-interest. For it is basic in procedural law that every
18
action must be prosecuted and defended in the name
of the real party-in-interest.26
Interest within the meaning of the rule means material
interest or an interest in issue to be affected by the
decree or judgment of the case, as distinguished from
mere curiosity about the question involved or a mere
incidental interest. One having no material interest to
protect cannot invoke the jurisdiction of the court as
plaintiff in an action. When plaintiff is not the real party-
in-interest, the case is dismissible on the ground of lack
of cause of action.27
Illuminating on this point is Amor-Catalan v. Court of
Appeals,28 where the Court held:
True, under the New Civil Code which is the law in
force at the time the respondents were married, or even
in the Family Code, there is no specific provision as to
who can file a petition to declare the nullity of marriage;
however, only a party who can demonstrate "proper
interest" can file the same. A petition to declare the
nullity of marriage, like any other actions, must be
prosecuted or defended in the name of the real party-
in-interest and must be based on a cause of action.
Thus, in Niñal v. Badayog, the Court held that the
children have the personality to file the petition to
declare the nullity of marriage of their deceased father
to their stepmother as it affects their successional
rights.
xxxx
In fine, petitioner's personality to file the petition to
declare the nullity of marriage cannot be ascertained
because of the absence of the divorce decree and the
foreign law allowing it. Hence, a remand of the case to
the trial court for reception of additional evidence is
necessary to determine whether respondent Orlando
was granted a divorce decree and whether the foreign
law which granted the same allows or restricts
remarriage. If it is proved that a valid divorce decree
was obtained and the same did not allow respondent
Orlando's remarriage, then the trial court should
declare respondent's marriage as bigamous and
void ab initio but reduced the amount of moral
damages from P300,000.00 to P50,000.00 and
exemplary damages from P200,000.00 to P25,000.00.
On the contrary, if it is proved that a valid divorce
decree was obtained which allowed Orlando to
remarry, then the trial court must dismiss the instant
petition to declare nullity of marriage on the ground that
petitioner Felicitas Amor-Catalan lacks legal
personality to file the same.29(Underscoring supplied)
III. The case must be remanded to determine
whether or not petitioner is a real-party-in-interest
to seek the declaration of nullity of the marriage in
controversy.
In the case at bench, the records reveal that when
Teofilo died intestate in 1992, his only surviving
compulsory heirs are respondent Felicidad and their
son, Teofilo II. Under the law on succession,
successional rights are transmitted from the moment of
death of the decedent and the compulsory heirs are
called to succeed by operation of law.30
Upon Teofilo's death in 1992, all his property, rights
and obligations to the extent of the value of the
inheritance are transmitted to his compulsory heirs.
These heirs were respondents Felicidad and Teofilo II,
as the surviving spouse and child, respectively.
Article 887 of the Civil Code outlined who are
compulsory heirs, to wit:
(1) Legitimate children and descendants, with respect
to their legitimate parents and ascendants;
(2) In default of the foregoing, legitimate parents and
ascendants, with respect to their legitimate children
and descendants;
(3) The widow or widower;
(4) Acknowledged natural children, and natural
children by legal fiction;
(5) Other illegitimate children referred to in Article 287
of the Civil Code.31
Clearly, a brother is not among those considered as
compulsory heirs. But although a collateral relative,
such as a brother, does not fall within the ambit of a
compulsory heir, he still has a right to succeed to the
estate. Articles 1001 and 1003 of the New Civil Code
provide:
ART. 1001. Should brothers and sisters or their
children survive with the widow or widower, the latter
shall be entitled to one-half of the inheritance and the
brothers and sisters or their children to the other half.
ART. 1003. If there are no descendants, ascendants,
illegitimate children, or a surviving spouse, the
collateral relatives shall succeed to the entire estate of
the deceased in accordance with the following articles.
(Underscoring supplied)
Indeed, only the presence of descendants, ascendants
or illegitimate children excludes collateral relatives
from succeeding to the estate of the decedent. The
presence of legitimate, illegitimate, or adopted child or
children of the deceased precludes succession by
collateral relatives.32 Conversely, if there are no
descendants, ascendants, illegitimate children, or a
surviving spouse, the collateral relatives shall succeed
to the entire estate of the decedent.33
If respondent Teofilo II is declared and finally proven
not to be the legitimate, illegitimate, or adopted son of
Teofilo, petitioner would then have a personality to
seek the nullity of marriage of his deceased brother
with respondent Felicidad. This is so, considering that
collateral relatives, like a brother and sister, acquire
successional right over the estate if the decedent dies
without issue and without ascendants in the direct line.
The records reveal that Teofilo was predeceased by
his parents. He had no other siblings but petitioner.
Thus, if Teofilo II is finally found and proven to be not a
legitimate, illegitimate, or adopted son of Teofilo,
petitioner succeeds to the other half of the estate of his
brother, the first half being allotted to the widow
pursuant to Article 1001 of the New Civil Code. This
makes petitioner a real-party-interest to seek the
declaration of absolute nullity of marriage of his
deceased brother with respondent Felicidad. If the
subject marriage is found to be void ab initio, petitioner
succeeds to the entire estate.
It bears stressing, however, that the legal personality
of petitioner to bring the nullity of marriage case is
contingent upon the final declaration that Teofilo II is
not a legitimate, adopted, or illegitimate son of Teofilo.
If Teofilo II is proven to be a legitimate, illegitimate, or
legally adopted son of Teofilo, then petitioner has no
legal personality to ask for the nullity of marriage of his
deceased brother and respondent Felicidad. This is
19
based on the ground that he has no successional right legitimacy or may have been sentenced as an
CONSUELO YNARES-SANTIAGO
to be protected, hence, does not have proper interest. adulteress. (Underscoring supplied)
Associate Justice
For although the marriage in controversy may be found
It is stressed that Felicidad's declaration against the Chairperson
to be void from the beginning, still, petitioner would not
inherit. This is because the presence of descendant, legitimate status of Teofilo II is the very act that is
illegitimate,34 or even an adopted child35 excludes the proscribed by Article 167 of the Family Code. The
MA. ALICIA AUSTRIA-MARTINEZ MINITA V.
collateral relatives from inheriting from the decedent. language of the law is unmistakable. An assertion by
Associate Justice NAZARIO
the mother against the legitimacy of her child cannot
Associate J
Thus, the Court finds that a remand of the case for trial affect the legitimacy of a child born or conceived within
on the merits to determine the validity or nullity of the a valid marriage.37
subject marriage is called for. But the RTC is strictly ANTONIO EDUARDO B. NACHURA
instructed to dismiss the nullity of marriage case Finally, the disposition of the trial court in favor of
Associate Justice
for lack of cause of action if it is proven by petitioner for causes of action concerning
evidence that Teofilo II is a legitimate, illegitimate, reconveyance, recovery of property, and sum of money
or legally adopted son of Teofilo Carlos, the must be vacated. This has to be so, as said disposition
deceased brother of petitioner. was made on the basis of its finding that the marriage
in controversy was null and void ab initio. ATTESTATION
IV. Remand of the case regarding the question of
filiation of respondent Teofilo II is proper and in WHEREFORE, the appealed Decision I attest that the conclusions in the above Decision had
order. There is a need to vacate the disposition of the is MODIFIED as follows: been reached in consultation before the case was
trial court as to the other causes of action before it. assigned to the writer of the opinion of the Court's
1. The case is REMANDED to the Regional Trial Court Division.
Petitioner did not assign as error or interpose as issue in regard to the action on the status and filiation of
the ruling of the CA on the remand of the case respondent Teofilo Carlos II and the validity or nullity of CONSUELO YNARES-SANTIAGO
concerning the filiation of respondent Teofilo II. This marriage between respondent Felicidad Sandoval and Associate Justice
notwithstanding, We should not leave the matter the late Teofilo Carlos; Chairperson
hanging in limbo.
2. If Teofilo Carlos II is proven to be the legitimate, or
This Court has the authority to review matters not illegitimate, or legally adopted son of the late Teofilo
specifically raised or assigned as error by the parties, Carlos, the RTC is
strictly INSTRUCTED to DISMISS the action for nullity CERTIFICATION
if their consideration is necessary in arriving at a just
resolution of the case.36 of marriage for lack of cause of action;
Pursuant to Section 13, Article VIII of the Constitution
3. The disposition of the RTC in Nos. 1 to 8 of and the Division Chairperson's Attestation, I certify
We agree with the CA that without trial on the merits that the conclusions in the above Decision had been
having been conducted in the case, petitioner's bare the fallo of its decision is VACATED AND SET ASIDE.
reached in consultation before the case was assigned
allegation that respondent Teofilo II was adopted from to the writer of the opinion of the Court's Division.
The Regional Trial Court is ORDERED to conduct trial
an indigent couple is insufficient to support a total
on the merits with dispatch and to give this case priority
forfeiture of rights arising from his putative filiation. REYNATO S. PUNO
in its calendar.
However, We are not inclined to support its Chief Justice
pronouncement that the declaration of respondent No costs.
Felicidad as to the illegitimate filiation of respondent
Teofilo II is more credible. For the guidance of the SO ORDERED.
appellate court, such declaration of respondent
Felicidad should not be afforded credence. We remind RUBEN T. REYES Footnotes
the CA of the guaranty provided by Article 167 of the Associate Justice 1Rollo, pp. 47-63. Dated October 15, 2002. Penned by
Family Code to protect the status of legitimacy of a
Associate Justice Rebecca De Guia-Salvador, with
child, to wit:
Associate Justices Cancio C. Garcia and Bernardo P.
ARTICLE 167. The child shall be considered legitimate WE CONCUR: Abesamis, concurring.
although the mother may have declared against its 2 Civil Case No. 95-135.
20
3 Rollo, pp. 49-51.
4 Docketed as Civil Case No. 11975, CA decision, p. 6.
5 Rollo, p. 55.
6 citation omitted.)
CA rollo, pp. 48-49.
7 Id. at 429-430.
Id. at 63.
8 Id. at 60-63.
9 Rollo, pp. 24-25.
10 Rules of Civil Procedure (1997), Rule 34, Sec. 1.
SECTION 1. Judgment on the pleadings. - Where an
answer fails to tender an issue, or otherwise admits the
material allegations of the adverse party's pleading, the
court may, on motion of that party, direct judgment on
such pleading. However, in actions for declaration of
nullity or annulment of marriage or for legal separation,
the material facts alleged in the complaint shall always
be proved.
11 CA rollo, p. 61.
12 Sec. 25. Effectivity. - This Rule shall take effect on
March 15, 2003 following its publication in a newspaper
of general circulation not later than March 7, 2003.
13G.R. No. 152154, November 18, 2003, 416 SCRA
133, citing Family Code, Arts. 48 & 60, and Roque v.
Encarnacion, 96 Phil. 643 (1954).
14 Republic v. Sandiganbayan, id. at 143.
15
Republic v. Cuison-Melgar, G.R. No. 139676, March
31, 2006, 486 SCRA 177, citing Malcampo-Sin v. Sin,
G.R. No. 137590, March 26, 2001, 355 SCRA 285,
289, and Republic v. Dagdag, G.R. No. 109975,
February 9, 2001, 351 SCRA 425, 435.
16Id. at 187-188, citing Republic v. Iyoy, G.R. No.
152577, September 21, 2005, 470 SCRA 508, 529,
andAncheta v. Ancheta, G.R. No. 145370, March 4,
2004, 424 SCRA 725, 740.
17Enrico v. Heirs of Sps. Medinaceli, G.R. No. 173614,
September 28, 2007, 534 SCRA 418, 429, citing
Rationale of the Rules on Annulment of Voidable
Marriages and Declaration of Absolute Nullity of Void
Marriages, Legal Separation and Provisional Orders.
18 Id. at 427-428, citing Modequillo v. Brava, G.R. No.
86355, May 31, 1990, 185 SCRA 766, 772. (Note in the
19
20
A.M. No. 02-11-10-SC - Rule on Declaration of
Absolute Nullity of Void Marriages and Annulment of
Voidable Marriages.
SEC. 25. Effectivity. - This Rule shall take effect on
March 15, 2003 following its publication in a newspaper
of general circulation not later than March 7, 2003.
21
Supra note 17.
22
Enrico v. Heirs of Sps. Medinaceli, id. at 428.
23Malang v. Moson, G.R. No. 119064, August 22,
2000, 338 SCRA 393.
24See Republic v. Dayot, G.R. No. 175581,
and Tecson-Dayot v. Dayot, G.R. No. 179474, March
28, 2008;Alcantara v. Alcantara, G.R. No. 167746,
August 28, 2007, 531 SCRA 446.
25Republic v. Agunoy, Sr., G.R. No. 155394, February
17, 2005, 451 SCRA 735, 746.
26Oco v. Limbaring, G.R. No. 161298, January 31,
2006, 481 SCRA 348.
27Id. at 358, citing Abella, Jr. v. Civil Service
Commission, G.R. No. 152574, November 17, 2004,
442 SCRA 507, 521; Pascual v. Court of Appeals, G.R.
No. 115925, August 15, 2003, 409 SCRA 105, 117;
andBank of America NT & SA v. Court of Appeals, 448
Phil. 181, 194-195 (2003); Borlongan v. Madrideo, 380
Phil. 215, 224 (2000); Mathay v. Court of Appeals, 378
Phil. 466, 482 (1999); Ralla v. Ralla, G.R. No. 78646,
July 23, 1991, 199 SCRA 495, 499; Rebollido v. Court
of Appeals, G.R. No. 81123, February 28, 1989, 170
SCRA 800, 806; Chua v. Torres, G.R. No. 151900,
August 30, 2005, 468 SCRA 358, citing Tan v. Court of
Appeals, G.R. No. 127210, August 7, 2003, 408 SCRA
470, 475-76; citing in turn University of the Philippines
Board of Regents v. Ligot-Telan, G.R. No. 110280,
October 21, 1993, 227 SCRA 342, 355; Ralla v.
Ralla, supra; Rebollido v. Court of
Appeals, supra; Shipside, Inc. v. Court of
Appeals, G.R. No. 143377, February 20, 2001, 352
SCRA 334, 346, in turn citing Pioneer Insurance &
Surety Corporation v. Court of Appeals, G.R. Nos.
84197 & 84157, July 18, 1989, 175 SCRA 668.
28 G.R. No. 167109, February 6, 2007, 514 SCRA 607,
citing Rules of Court, Rule 3, Sec. 2, Rule 2, Sec. 1;
Niñal v. Badayog, G.R. No. 133778, March 14, 2000,
328 SCRA 122.
29 Amor-Catalan v. Court of Appeals, id. at 614-615.
30Rabadilla v. Court of Appeals, G.R. No. 113725,
June 29, 2000, 334 SCRA 522.
31
Paragraphs 4 & 5 are no longer controlling. The
distinctions among different classes of illegitimate
children under the Civil Code have been removed. All
of them fall in the category of illegitimate children, as
provided under Article 165 of the Family Code:
Article 165. Children conceived and born outside a
valid marriage are illegitimate, unless otherwise
provided in this Code.
32
See Gonzales v. Court of Appeals, G.R. No.
117740, October 30, 1998, 298 SCRA 322; see
also Reyes v. Sotero, G.R. No. 167405, February 16,
2006, 482 SCRA 520; Pedrosa v. Court of
Appeals, G.R. No. 118680, March 5, 2001, 353 SCRA
620; Heirs of Ignacio Conti v. Court of Appeals, G.R.
No. 118464, December 21, 1998, 300 SCRA 345.
33 Heirs of Ignacio Conti v. Court of Appeals, supra.
34 Gonzales v. Court of Appeals, supra note 32.
35
Reyes v. Sotero, supra note 32; Pedrosa v. Court of
Appeals, supra note 32.
36Maricalum Mining Corporation v. Brion, G.R. Nos.
157696-97, February 9, 2006, 482 SCRA 87, citing
Sociedad Europea de Financiacion, S.A. v. Court of
Appeals, G.R. No. 75787, January 21, 1991, 193
SCRA 105, 114, citing in turn Saura Import & Export
Co., Inc. v. Philippine International Co., Inc., 118 Phil.
150, 156 (1963); and Miguel v. Court of Appeals, 140
Phil. 304, 312 (1969).
37
Concepcion v. Court of Appeals, G.R. No. 123450,
August 31, 2005, 468 SCRA 438
21
22

Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 174238 July 7, 2009
ANITA CHENG, Petitioner,
vs.
SPOUSES WILLIAM SY and TESSIE
SY, Respondents.
DECISION
NACHURA, J.:
This is a petition1 for review on certiorari under Rule 45
of the Rules of Court of the Order dated January 2,
20062of the Regional Trial Court (RTC), Branch 18,
Manila in Civil Case No. 05-112452 entitled Anita
Cheng v. Spouses William Sy and Tessie Sy.
The antecedents are as follows—
Petitioner Anita Cheng filed two (2) estafa cases before
the RTC, Branch 7, Manila against respondent
spouses William and Tessie Sy (Criminal Case No. 98-
969952 against Tessie Sy and Criminal Case No. 98-
969953 against William Sy) for issuing to her Philippine
Bank of Commerce (PBC) Check Nos. 171762 and
71860 for P300,000.00 each, in payment of their loan,
both of which were dishonored upon presentment for
having been drawn against a closed account.
Meanwhile, based on the same facts, petitioner, on
January 20, 1999, filed against respondents two (2)
cases for violation of Batas Pambansa Bilang (BP Blg.)
22 before the Metropolitan Trial Court (MeTC), Branch
25, Manila (Criminal Case Nos. 341458-59).
On March 16, 2004, the RTC, Branch 7, Manila
dismissed the estafa cases for failure of the
prosecution to prove the elements of the crime. The
Order dismissing Criminal Case No. 98-969952
contained no declaration as to the civil liability of Tessie
Sy.3 On the other hand, the Order in Criminal Case No.
98-969953 contained a statement, "Hence, if there is
any liability of the accused, the same is purely ‘civil,’
not criminal in nature."4
Later, the MeTC, Branch 25, Manila, dismissed, on
demurrer, the BP Blg. 22 cases in its Order5 dated
February 7, 2005 on account of the failure of petitioner
to identify the accused respondents in open court. The
Order also did not make any pronouncement as to the
civil liability of accused respondents.1avvphi1
On April 26, 2005, petitioner lodged against
respondents before the RTC, Branch 18, Manila, a
complaint6 for collection of a sum of money with
damages (Civil Case No. 05-112452) based on the
same loaned amount ofP600,000.00 covered by the
two PBC checks previously subject of the estafa and
BP Blg. 22 cases.
In the assailed Order7 dated January 2, 2006, the RTC,
Branch 18, Manila, dismissed the complaint for lack of
jurisdiction, ratiocinating that the civil action to collect
the amount of P600,000.00 with damages was already
impliedly instituted in the BP Blg. 22 cases in light of
Section 1, paragraph (b) of Rule 111 of the Revised
Rules of Court.
Petitioner filed a motion for reconsideration 8 which the
court denied in its Order9 dated June 5, 2006. Hence,
this petition, raising the sole legal issue –
Whether or not Section 1 of Rule 111 of the 2000 Rules
of Criminal Procedure and Supreme Court Circular No.
57-97 on the Rules and Guidelines in the filing and
prosecution of criminal cases under BP Blg. 22 are
applicable to the present case where the nature of the
order dismissing the cases for bouncing checks
against the respondents was [based] on the failure of
the prosecution to identify both the accused
(respondents herein)?10
Essentially, petitioner argues that since the BP Blg. 22
cases were filed on January 20, 1999, the 2000
Revised Rules on Criminal Procedure promulgated on
December 1, 2000 should not apply, as it must be given
only prospective application. She further contends that
that her case falls within the following exceptions to the
rule that the civil action correspondent to the criminal
action is deemed instituted with the latter—
(1) additional evidence as to the identities of the
accused is necessary for the resolution of the civil
aspect of the case;
(2) a separate complaint would be just as efficacious
as or even more expedient than a timely remand to the
trial court where the criminal action was decided for
further hearings on the civil aspect of the case;
(3) the trial court failed to make any pronouncement as
to the civil liability of the accused amounting to a
reservation of the right to have the civil liability litigated
in a separate action;
(4) the trial court did not declare that the facts from
which the civil liability might arise did not exist;
(5) the civil complaint is based on an obligation ex-
contractu and not ex-delicto pursuant to Article 3111 of
the Civil Code; and
(6) the claim for civil liability for damages may be had
under Article 2912 of the Civil Code.
Petitioner also points out that she was not assisted by
any private prosecutor in the BP Blg. 22 proceedings.
The rule is that upon the filing of the estafa and BP Blg.
22 cases against respondents, where the petitioner
has not made any waiver, express reservation to
litigate separately, or has not instituted the
corresponding civil action to collect the amount
of P600,000.00 and damages prior to the criminal
action, the civil action is deemed instituted with the
criminal cases.13
This rule applies especially with the advent of the 2000
Revised Rules on Criminal Procedure. Thus, during the
pendency of both the estafa and the BP Blg. 22 cases,
23
the action to recover the civil liability was impliedly
instituted and remained pending before the respective
trial courts. This is consonant with our ruling in
Rodriguez v. Ponferrada14 that the possible single civil
liability arising from the act of issuing a bouncing check
can be the subject of both civil actions deemed
instituted with the estafa case and the prosecution for
violation of BP Blg. 22, simultaneously available to the
complaining party, without traversing the prohibition
against forum shopping.15Prior to the judgment in
either the estafa case or the BP Blg. 22 case,
petitioner, as the complainant, cannot be deemed to
have elected either of the civil actions both impliedly
instituted in the said criminal proceedings to the
exclusion of the other.16
The dismissal of the estafa cases for failure of the
prosecution to prove the elements of the crime beyond
reasonable doubt—where in Criminal Case No. 98-
969952 there was no pronouncement as regards the
civil liability of the accused and in Criminal Case No.
98-969953 where the trial court declared that the
liability of the accused was only civil in nature—
produced the legal effect of a reservation by the
petitioner of her right to litigate separately the civil
action impliedly instituted with the estafa cases,
following Article 29 of the Civil Code.17
However, although this civil action could have been
litigated separately on account of the dismissal of the
estafa cases on reasonable doubt, the petitioner was
deemed to have also elected that such civil action be
prosecuted together with the BP Blg. 22 cases in light
of the Rodriguez v. Ponferrada ruling.
With the dismissal of the BP Blg. 22 cases for failure to
establish the identity of the accused, the question that
arises is whether such dismissal would have the same
legal effect as the dismissed estafa cases. Put
differently, may petitioner’s action to recover
respondents’ civil liability be also allowed to prosper
separately after the BP Blg. 22 cases were dismissed?
Section 1 (b), Rule 111 of the 2000 Revised Rules on
Criminal Procedure states –
Section 1. Institution of criminal and civil actions. –
xxx
(b) The criminal action for violation of Batas Pambansa
Blg. 22 shall be deemed to include the corresponding
civil action. No reservation to file such civil action
separately shall be allowed.
Upon filing of the joint criminal and civil actions, the
offended party shall pay in full the filing fees based on
the amount of the check involved, which shall be
considered as the actual damages claimed. Where the
complaint or information also seeks to recover
liquidated, moral, nominal, temperate or exemplary
damages, the offended party shall pay the filing fees
based on the amounts alleged therein. If the amounts
are not so alleged but any of these damages [is]
subsequently awarded by the court, the filing fees
based on the amount awarded shall constitute a first
lien on the judgment.
Where the civil action has been filed separately and
trial thereof has not yet commenced, it may be
consolidated with the criminal action upon application
with the court trying the latter case. If the application is
granted, the trial of both actions shall proceed in
accordance with section 2 of this Rule governing
consolidation of the civil and criminal actions.
Petitioner is in error when she insists that the 2000
Rules on Criminal Procedure should not apply because
she filed her BP Blg. 22 complaints in 1999. It is now
settled that rules of procedure apply even to cases
already pending at the time of their promulgation. The
fact that procedural statutes may somehow affect the
litigants’ rights does not preclude their retroactive
application to pending actions. It is axiomatic that the
retroactive application of procedural laws does not
violate any right of a person who may feel that he is
adversely affected, nor is it constitutionally
objectionable. The reason for this is that, as a general
rule, no vested right may attach to, nor arise from,
procedural laws.18
Indeed, under the present revised Rules, the criminal
action for violation of BP Blg. 22 includes the
corresponding civil action to recover the amount of the
checks. It should be stressed, this policy is intended to
discourage the separate filing of the civil action. In fact,
the Rules even prohibits the reservation of a separate
civil action, i.e., one can no longer file a separate civil
case after the criminal complaint is filed in court. The
only instance when separate proceedings are allowed
is when the civil action is filed ahead of the criminal
case. Even then, the Rules encourages the
consolidation of the civil and criminal cases. Thus,
where petitioner’s rights may be fully adjudicated in the
proceedings before the court trying the BP Blg. 22
cases, resort to a separate action to recover civil
liability is clearly unwarranted on account of res
judicata, for failure of petitioner to appeal the civil
aspect of the cases. In view of this special rule
governing actions for violation of BP Blg. 22, Article 31
of the Civil Code is not applicable.19
Be it remembered that rules governing procedure
before the courts, while not cast in stone, are for the
speedy, efficient, and orderly dispensation of justice
and should therefore be adhered to in order to attain
this objective.20
However, in applying the procedure discussed above,
it appears that petitioner would be left without a remedy
to recover from respondents the P600,000.00
allegedly loaned from her. This could prejudice even
the petitioner’s Notice of Claim involving the same
amount filed in Special Proceedings No. 98-88390
(Petition for Voluntary Insolvency by Kolin Enterprises,
William Sy and Tessie Sy), which case was reportedly
archived for failure to prosecute the petition for an
unreasonable length of time.21 Expectedly,
respondents would raise the same defense that
petitioner had already elected to litigate the civil action
to recover the amount of the checks along with the BP
Blg. 22 cases.
It is in this light that we find petitioner’s contention that
she was not assisted by a private prosecutor during the
BP Blg. 22 proceedings critical. Petitioner indirectly
protests that the public prosecutor failed to protect and
prosecute her cause when he failed to have her
establish the identities of the accused during the trial
and when he failed to appeal the civil action deemed
impliedly instituted with the BP Blg. 22 cases. On this
ground, we agree with petitioner.
Faced with the dismissal of the BP Blg. 22 cases,
petitioner’s recourse pursuant to the prevailing rules of
procedure would have been to appeal the civil action
to recover the amount loaned to respondents
corresponding to the bounced checks. Hence, the said
civil action may proceed requiring only a
preponderance of evidence on the part of petitioner.
24
Her failure to appeal within the reglementary period There is unjust enrichment when (1) a person is assigned to the writer of the opinion of the Court’s
was tantamount to a waiver altogether of the remedy unjustly benefited, and (2) such benefit is derived at the Division.
to recover the civil liability of respondents. However, expense of or with damages to another. This doctrine
due to the gross mistake of the prosecutor in the BP simply means that a person shall not be allowed to CONSUELO YNARES-SANTIAGO
Blg. 22 cases, we are constrained to digress from this profit or enrich himself inequitably at another’s Associate Justice
rule. expense. One condition for invoking this principle of Chairperson, Third Division
unjust enrichment is that the aggrieved party has no
It is true that clients are bound by the mistakes, CERTIFICATION
other recourse based on contract, quasi-contract,
negligence and omission of their counsel.22 But this crime, quasi-delict or any other provision of law.26 Pursuant to Section 13, Article VIII of the Constitution
rule admits of exceptions – (1) where the counsel’s
and the Division Chairperson's Attestation, I certify
mistake is so great and serious that the client is Court litigations are primarily designed to search for the
that the conclusions in the above Decision had been
prejudiced and denied his day in court, or (2) where the truth, and a liberal interpretation and application of the
reached in consultation before the case was assigned
counsel is guilty of gross negligence resulting in the rules which will give the parties the fullest opportunity
to the writer of the opinion of the Court’s Division.
client’s deprivation of liberty or property without due to adduce proof is the best way to ferret out the truth.
process of law.23 Tested against these guidelines, we The dispensation of justice and vindication of legitimate REYNATO S. PUNO
hold that petitioner’s lot falls within the exceptions. grievances should not be barred by Chief Justice
technicalities.27 For reasons of substantial justice and
It is an oft-repeated exhortation to counsels to be well- equity, as the complement of the legal jurisdiction that
informed of existing laws and rules and to keep abreast seeks to dispense justice where courts of law, through
with legal developments, recent enactments and the inflexibility of their rules and want of power to adapt
jurisprudence. Unless they faithfully comply with such their judgments to the special circumstances of cases, Footnotes
duty, they may not be able to discharge competently are incompetent to do so,28 we thus rule, pro hac vice, 1
and diligently their obligations as members of the in favor of petitioner. Rollo, pp. 3-19.
Bar.24 Further, lawyers in the government service are 2
expected to be more conscientious in the performance WHEREFORE, the petition is GRANTED. Civil Case Id. at 22-27.
of their duties as they are subject to public scrutiny. No. 05-112452 entitled Anita Cheng v. Spouses 3 Id. at 45-47.
They are not only members of the Bar but are also William Sy and Tessie Sy is hereby ordered
public servants who owe utmost fidelity to public REINSTATED. No pronouncement as to costs. 4 Id. at 48-50.
service.25 Apparently, the public prosecutor neglected
to equip himself with the knowledge of the proper SO ORDERED. 5 Id. at 42-44.
procedure for BP Blg. 22 cases under the 2000 Rules
ANTONIO EDUARDO B. NACHURA 6 Id. at 51-53.
on Criminal Procedure such that he failed to appeal the
Associate Justice
civil action impliedly instituted with the BP Blg. 22 7 Supra note 2.
cases, the only remaining remedy available to WE CONCUR:
petitioner to be able to recover the money she loaned 8 Rollo, pp. 28-38.
to respondents, upon the dismissal of the criminal CONSUELO YNARES-SANTIAGO
cases on demurrer. By this failure, petitioner was 9
Associate Justice Id. at 41.
denied her day in court to prosecute the respondents Chairperson
10
for their obligation to pay their loan. Id. at 6.
MINITA V. CHICO- PRESBITERO J. 11
Moreover, we take into consideration the trial court’s NAZARIO VELASCO, JR. Art. 31. When the civil action is based on an
observation when it dismissed the estafa charge in Associate Justice Associate Justice obligation not arising from the act or omission
Criminal Case No. 98-969953 that if there was any complained of as a felony, such civil action may
liability on the part of respondents, it was civil in nature. DIOSDADO M. PERALTA proceed independently of the criminal proceedings and
Hence, if the loan be proven true, the inability of Associate Justice regardless of the result of the latter.
petitioner to recover the loaned amount would be 12
tantamount to unjust enrichment of respondents, as ATTESTATION Art. 29. When the accused in a criminal prosecution
they may now conveniently evade payment of their is acquitted on the ground that his guilt has not been
I attest that the conclusions in the above Decision proved beyond reasonable doubt, a civil action for
obligation merely on account of a technicality applied
against petitioner. were reached in consultation before the case was damages for the same act or omission may be

25
 17
instituted. Such action requires only a preponderance Jarantilla v. Court of Appeals, 253 Phil. 425, 433
of evidence. Upon motion of the defendant, the court (1989), citing Bernaldes, Jr. v. Bohol Land
may require the plaintiff to file a bond to answer for Transportation, Inc., 117 Phil. 288, 291-292 (1963) and
damages in case the complaint should be found to be Bachrach Motors Co. v. Gamboa, 101 Phil. 1219
malicious. (1957).
13 Section 1. Institution of criminal and civil actions. – 18Tan, Jr. v. Court of Appeals, 424 Phil. 556, 559
When a criminal action is instituted, the civil action for (2002).
the recovery of civil liability is impliedly instituted with
19
the criminal action, unless the offended party waives Hyatt Industrial Manufacturing Corp. v. Asia
the civil action, reserves his right to institute it Dynamic Electrix Corp., G.R. No. 163597, July 29,
separately, or institutes the civil action prior to the 2005, 465 SCRA 454, 461-462.
criminal action. 20 Id.
Such civil action includes recovery of indemnity under 21 Rollo, p. 23.
the Revised Penal Code, and damages under Articles
32, 33, 34 and 2176 of the Civil Code of the Philippines 22Lynx Industries Contractor, Inc. v. Tala, G.R. No.
arising from the same act or omission of the accused. 164333, August 24, 2007, 531 SCRA 169, 176.
A waiver of any of the civil actions extinguishes the 23Ceniza-Manantan v. People, G.R. No. 156248,
others. The institution of, or the reservation of the right August 28, 2007, 531 SCRA 364, 380.
to file, any of said civil actions separately waives the
others. 24 Santiago v. Atty. Rafanan, 483 Phil. 94, 105 (2004).
The reservation of the right to institute the separate civil 25Ramos v. Imbang, A.C. No. 6788, August 23, 2007,
actions shall be made before the prosecution starts to 530 SCRA 759, 768.
present its evidence and under circumstances
26
affording the offended party a reasonable opportunity Chieng v. Santos, G.R. No. 169647, August 31,
to make such reservation. 2007, 531 SCRA 730, 747-748.
27
In no case may the offended party recover damages LCK Industries, Inc. v. Planters Development Bank,
twice for the same act or omission of the accused. G.R. No. 170606, November 23, 2007, 538 SCRA 634,
653.
When the offended party seeks to enforce civil liability
28
against the accused by way of moral, nominal, Id. at 652.
temperate or exemplary damages, the filing fees for
such civil action as provided in these Rules shall
constitute a first lien on the judgment except in an
award for actual damages.

In cases wherein the amount of damages, other than

actual, is alleged in the complaint or information, the
corresponding filing fees shall be paid by the offended
party upon the filing thereof in court for trial. (Rule 111,
1988 Rules on Criminal Procedure)
14 G.R. Nos. 155531-34, July 29, 2005, 465 SCRA 338.
15 Rodriguez v. Ponferrada, id. at 350.
16 Ibid.

26

Republic of the Philippines
SUPREME COURT
Baguio City
THIRD DIVISION
G.R. No. 189649 April 20, 2015
ADORACION CAROLINO (spouse and in
substitution of the deceased JEREMIAS A.
CAROLINO),Petitioner,
vs.
GEN. GENEROSO SENGA, as Chief of Staff of the
Armed Forces of the Philippines (AFP); BRIG
GEN. FERNANDO ZABAT, as Chief of the AFP
Finance Center; COMMO. REYNALDO BASILIO, as
Chief of the AFP-GHQ Management and Fiscal
Office; and COMMO. EMILIO MARAYAG, Pension
and Gratuity Officer, Pension and Gratuity
Management Center, AFP Finance
Center, Respondents.
DECISION
PERALTA, J.:
Before us is a petition for review under Rule 45 seeking
to reverse and set aside the Decision1 dated May 25,
2009 of the Court of Appeals (CA) in CA-G.R. SP No.
103502 and the Resolution2 dated September 10,
2009 denying reconsideration thereof.
The factual and legal antecedents are as follows:
On December 1, 1976, Jeremias A. Carolino,
petitioner's husband, Retired3 from the Armed Forces
of the Philippines (AFP) with the rank of Colonel under
General Order No. 1208 dated November 29, 1976,
pursuant to the provisions of Sections 1(A) and 10 of
Republic Act (RA) No. 340,4 as amended. He started
receiving his monthly retirement pay in the amount
of P18,315.00 in December 1976 until the same was
withheld by respondents in March 2005. On June 3,
2005, Jeremias wrote a letter5 addressed to the AFP
Chief of Staff asking for the reasons of the withholding
of his retirement pay. In a letter reply,6 Myrna F.
Villaruz, LTC (FS) PA, Pension and Gratuity Officer of
the AFP Finance Center, informed Jeremias that his
loss of Filipino citizenship caused the deletion of his
name in the alpha list of the AFP Pensioners’ Payroll
effective March 5, 2005; and that he could avail of re-
entitlement to his retirement benefits and the
restoration of his name in the AFP Pensioners' Master
list Payroll by complying with the requirements
prescribed under RA No. 9225, or the Dual Citizenship
Act.
It appeared that the termination of Jeremias' pension
was done pursuant to Disposition Form7 dated October
29, 2004,which was approved by the Chief of Staff and
made effective in January 2005. In the said Disposition
Form, the AFP Judge Advocate General opined that
under the provisions of Sections 4, 5, and 6 of RA No.
340, retired military personnel are disqualified from
receiving pension benefits once incapable to render
military service as a result of his having sworn
allegiance to a foreign country. It was also mentioned
that termination of retirement benefits of pensioner of
the AFP could be done pursuant to the provisions of
Presidential Decree (PD) No. 16388which provides that
the name of a retiree who loses his Filipino citizenship
shall be removed from the retired list and his retirement
benefits terminated upon such loss. It being in
consonance with the policy consideration that all
retirement laws inconsistent with the provisions of PD
No. 1638 are repealed and modified accordingly.
On August 24, 2006, Jeremias filed with the Regional
Trial Court (RTC) of Quezon City, a Petition for
Mandamus9against Gen. Generoso Senga, as Chief of
Staff of the AFP, Brig. Gen. Fernando Zabat, as Chief
of the AFP Finance Center, Comm. Reynaldo Basilio,
as Chief of the AFP- GHQ Management and Fiscal
Office, and Comm. Emilio Marayag, Pension and
Gratuity Management Officer, Pension and Gratuity
Management Center, AFP Finance Center, seeking
reinstatement of his name in the list of the AFP retired
officers, resumption of payment of his retirement
benefits under RA No. 340, and the reimbursement of
all his retirement pay and benefits which accrued from
March 5, 2005 up to the time his name is reinstated
and, thereafter, with claim for damages and attorney's
fees. The case was docketed as Civil Case No. Q-06-
58686, and raffled off to Branch 220.
On February 26, 2007, the RTC rendered its
Decision10 granting the petition for mandamus, the
dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered ordering
General Hermogenes Esperon, Jr., as Chief of Staff of
the AFP, Brigadier General Fernando Zabat, as the
Commanding Officer of the AFP Finance Center,
Commodore Reynaldo Basilio, as Chief of the AFP-
GHQ Management and Fiscal Office, and Captain
Theresa M. Nicdao, as Pension and Gratuity Officer of
the Pension and Gratuity Management Center, or any
of their respective successors and those taking
instructions from them as agents or subordinates, to:
a. immediately reinstate the name of petitioner in the
list of retired AFP Officers, and to resume payment of
his retirement benefits under RA 340; and
b. release to [petitioner] all retirement benefits due him
under RA 340 which accrued to him from March 2005
continuously up to the time his name is reinstated in
the list of AFP retired officers.11
The RTC found that the issue for resolution is the
applicability of RA No. 340 and PD No. 1638 upon
Jeremias' retirement benefits. It found that he retired as
a commissioned officer of the AFP in 1976; thus, RA
No. 340 is the law applicable in determining his
entitlement to his retirement benefits and not PD No.
1638 which was issued only in 1979. Article 4 of the
Civil Code provides that "laws shall have no retroactive
effect unless the contrary is provided." PD No. 1638
does not provide for such retroactive application. Also,
it could not have been the intendment of PD No. 1638
to deprive its loyal soldiers of a monthly pension during
their old age especially where, as here, the right had
27
been vested to them through time. RA No. 340 does
not provide that the loss of Filipino citizenship would
terminate one's retirement benefits; and that PD No.
1638 does not reduce whatever benefits that any
person has already been receiving under existing law.
Respondents sought reconsideration,12 but the RTC
denied the same in an Order13 dated May 25, 2007, the
decretal portion of which reads:
WHEREFORE, premises considered, the instant
Motion for Reconsideration is hereby DENIED,
considering that the questioned decision has not yet
attained its finality. The Motion for Execution in the
meantime is hereby DENIED.14
Aggrieved, respondents elevated the case to the CA.
After the submission of the parties' respective
memoranda, the case was submitted for decision.
Jeremias died on September 30, 200715and was
substituted by his wife, herein petitioner. On May 25,
2009, the CA granted respondents' appeal. The
dispositive portion of the CA decision reads:
WHEREFORE, premises considered, the instant
appeal is GRANTED. The appealed decision is
REVOKED and SET ASIDE.16
In so ruling, the CA found that while it is true that
Jeremias retired in 1976 under the provisions of RA No.
340, as amended, which does not contain any
provision anent cessation or loss of retirement benefits
upon acquiring another citizenship, PD No. 1638,
which was signed in 1979, effectively repealed RA No.
340, as amended. Section 27 of PD No. 1638, which
provides that the name of a retiree who loses his
Filipino citizenship shall be removed from the retired
list and his retirement benefits terminated upon such
loss, was correctly made applicable to Jeremias'
retirement benefits. Logic dictates that since Jeremias
had already renounced his allegiance to the
Philippines, he cannot now be compelled by the State
to render active service and to render compulsory
military service when the need arises. The CA found
that for the writ of mandamus to lie, it is essential that
Jeremias should have a clear legal right to the thing
demanded and it must be the imperative duty of
respondents to perform the act required which
petitioner failed to show; thus, mandamus will not lie.
Petitioner's motion for reconsideration was denied in a
Resolution dated September 10, 2009.
Hence, this petition raising the following:
RESPONDENT COURT OF APPEALS COMMITTED
GRAVE REVERSIBLE ERROR IN RENDERING THE
ASSAILED DECISION AND RESOLUTION WHICH
SET ASIDE AND REVERSED THE 26 FEBRUARY
2007 DECISION OF THE QC RTC BECAUSE:
PD 1638 should not have been applied and cannot be
used against petitioner as her husband's retirement
and pension were granted to him by the AFP under RA
340 which was not superseded by PD 1638, a later
statute.
Petitioner correctly availed of the remedy of mandamus
to compel the reinstatement of his pension and benefits
from the AFP under RA 340 as PD 1638 was not
applicable to him. Petitioner contends that her
husband's retirement from the active service in 1976
was pursuant to the provisions of RA No. No. 340 as
PD No. 1638 was not yet in existence then, and there
was nothing in RA No. 340 that disqualifies a retired
military personnel from receiving retirement benefits
after acquiring foreign citizenship. The concept of
retirement benefits is such that one is entitled to them
for services already rendered and not for those to be
made at a future time. Retirement benefits due
petitioner's husband under RA No. 340, is an acquired
right which cannot be taken away by a subsequent law.
PD No. 1638 does not expressly provide for its
retroactive application. Respondents, being officers of
the AFP tasked to implement the provisions of RA No.
340 have neglected their function thereunder by
delisting petitioner's husband as a retiree, thus,
mandamus is proper.
In his Comment, the Solicitor General argues that PD
No. 1638 applies to all military personnel in the service
of the AFP whether active or retired; hence, it applies
retroactively to petitioner's husband. Even when a
retiree is no longer in the active service, his being a
Filipino still makes him a part of the Citizen Armed
Forces; that whether a military personnel retires under
the provisions of RA No. 340 or under PD No. 1638, he
is still in the service of the military and/or the State only
that he is retired, thus, they should not be treated
differently upon the loss of Filipino citizenship. He
argues when there is an irreconcilable conflict between
the two laws of different vintages, i.e., RA No. 340 and
PD No. 1638, the latter enactment prevails.
The Solicitor General argues that mandamus will not
issue to enforce a right to compel compliance with a
duty which is questionable or over which a substantial
doubt exists. In this case, petitioner's husband does not
have a well-defined, clear and certain legal right to
continuously receive retirement benefits after
becoming an American citizen. Likewise, the AFP does
not have a clear and imperative duty to grant the said
benefits considering that Section 27 of PD No. 1638
provides that the name of a retiree who loses his
Filipino citizenship shall be removed from the retired
list and his retirement benefits terminated upon such
loss.
Petitioner filed her reply thereto.
We find merit in the petition.
Petitioner's husband retired in1976 under RA No. 340.
He was already receiving his monthly retirement
benefit in the amount of P18,315.00 since December
1976 until it was terminated in March 2005. Section 5,
RA No. 340 provides:
Sec. 5. Officers and enlisted men placed in the retired
list shall be subject to the rules and articles of war and
to trial by court-martial for any breach thereof. At any
time said officers and enlisted men may be called to
active service by the President. Refusal on the part of
any officer or enlisted man to perform such services
shall terminate his right to further participation in the
benefits of this Act provided he resides in the
Philippines and is physically fit for service. Such fitness
for service shall be determined by applicable
regulations.
The afore-quoted provision clearly shows how a
retiree's retirement benefits may be terminated, i.e.,
when the retiree refuses to perform active service
when called to do so provided that (1) the retiree
resides in the Philippines and (2) is physically fit for
service. There is no other requirement found in the law
which would be the reason for the termination of a
retiree's retirement benefits. Petitioner's husband was
never called to perform active service and refused to
do so, however, his retirement benefit was terminated.
28
The reason for such termination was his loss of Filipino
citizenship based on Section 27 of PD No. 1638, to wit:
Section 27. Military personnel retired under Sections 4,
5, 10, 11 and 12 shall be carried in the retired list of the
Armed Forces of the Philippines. The name of a retiree
who loses his Filipino citizenship shall be removed
from the retired list and his retirement benefits
terminated upon such loss.
We find that the CA erred in applying PD No. 1638 to
the retirement benefits of petitioner's husband.
Firstly, PD No. 1638 was signed by then President
Ferdinand Marcos on September 10, 1979. Under
Article 4 of the Civil Code, it is provided that laws shall
have no retroactive effect, unless the contrary is
provided. It is said that the law looks to the future only
and has no retroactive effect unless the legislator may
have formally given that effect to some legal
provisions;17 that all statutes are to be construed as
having only prospective operation, unless the purpose
and intention of the legislature to give them a
retrospective effect is expressly declared or is
necessarily implied from the language used; and that
every case of doubt must be resolved against
retrospective effect.18 These principles also apply to
amendments of statutes.
PD No. 1638 does not contain any provision regarding
its retroactive application, nor the same may be implied
from its language. In fact, Section 36 of PD No. 1638
clearly provides that the decree shall take effect upon
its approval. As held in Parreño v. COA,19 there is no
question that PD No. 1638, as amended, applies
prospectively. Since PD No. 1638, as amended, is
about the new system of retirement and separation
from service of military personnel, it should apply to
those who were in the service at the time of its
approval.20 Conversely, PD No. 1638 is not applicable
to those who retired before its effectivity in 1979. The
rule is familiar that after an act is amended, the original
act continues to be in force with regard to all rights that
had accrued prior to such amendment.21
Moreover, Section 27 of PD No. 1638 specifically
provides for the retirees to whom the law shall be
applied, to wit:
Section 27. Military personnel retired under Sections 4,
5, 10, 11 and 12 shall be carried in the retired list of the
Armed Forces of the Philippines. The name of a retiree
who loses his Filipino citizenship shall be removed
from the retired list and his retirement benefits
terminated upon such loss. (emphasis supplied)
Notably, petitioner's husband did not retire under those
above-enumerated Sections of PD No. 1638 as he
retired under RA No. 340.
Secondly, it has been held that before a right to
retirement benefits or pension vests in an employee,
he must have met the stated conditions of eligibility with
respect to the nature of employment, age, and length
of service.22Undeniably, petitioner's husband had
complied with the conditions of eligibility to retirement
benefits as he was then receiving his retirement
benefits on a monthly basis until it was terminated.
Where the employee retires and meets the eligibility
requirements, he acquires a vested right to the benefits
that is protected by the due process clause.23 It is only
upon retirement that military personnel acquire a
vested right to retirement benefits.24 Retirees enjoy a
protected property interest whenever they acquire a
right to immediate payment under pre-existing law.25
In Ayog v. Cusi,26 we expounded the nature of a vested
right, thus:
"A right is vested when the right to enjoyment has
become the property of some particular person or
persons as a present interest" (16 C.J.S.
1173).1âwphi1 It is "the privilege to enjoy property
legally vested, to enforce contracts, and enjoy the
rights of property conferred by the existing law" (12
C.J.S. 955, Note 46, No. 6) or "some right or interest in
property which has become fixed and established and
is no longer open to doubt or controversy" (Downs vs.
Blount 170 Fed. 15, 20, cited in Balboa vs. Farrales, 51
Phil. 498, 502).
The due process clause prohibits the annihilation of
vested rights. "A state may not impair vested rights by
legislative enactment, by the enactment or by the
subsequent repeal of a municipal ordinance, or by a
change in the constitution of the State, except in a
legitimate exercise of the police power" (16 C.J.S.
1177-78).
It has been observed that, generally, the term "vested
right" expresses the concept of present fixed interest,
which in right reason and natural justice should be
protected against arbitrary State action, or an innately
just and imperative right which an enlightened free
society, sensitive to inherent and irrefragable individual
rights, cannot deny (16 C.J.S. 1174, Note 71, No. 5,
citing Pennsylvania Greyhound Lines, Inc. vs.
Rosenthal, 192 Atl. 2nd 587).27
Petitioner's husband acquired vested right to the
payment of his retirement benefits which must be
respected and cannot be affected by the subsequent
enactment of PD No. 1638 which provides that loss of
Filipino citizenship terminates retirement benefits.
Vested rights include not only legal or equitable title to
the enforcement of a demand, but also an exemption
from new obligations after the right has vested.28
In fact, Sections 33 and 35 of PD No.1638 recognize
such vested right, to wit:
Section 33. Nothing in this Decree shall be construed
in any manner to reduce whatever retirement and
separation pay or gratuity or other monetary benefits
which any person is heretofore receiving or is entitled
to receive under the provisions of existing law.
xxxx
Section. 35. Except those necessary to give effect to
the provisions of this Decree and to preserve the rights
granted to retired or separated military personnel, all
laws, rules and regulations inconsistent with the
provisions of this Decree are hereby repealed or
modified accordingly.
Section 33 of PD No. 1638 is clear that the law has no
intention to reduce or to revoke whatever retirement
benefits being enjoyed by a retiree at the time of its
passage. Hence, Section 35 provides for an exception
to what the decree repealed or modified, i.e., except
those necessary to preserve the rights granted to
retired or separated military personnel.
We also find that the CA erred in finding that
mandamus will not lie.
Section 3, Rule 65 of the Rules of Court lay down under
what circumstances petition for mandamus may be
filed, to wit:
29
SEC. 3. Petition for mandamus. – When any tribunal, the principle of exhaustion of administrative remedies reached in consultation before the case was assigned
corporation, board, officer or person unlawfully need not be adhered to when the question is purely to the writer of the opinion of the Court's Division.
neglects the performance of an act which the law legal.35 This is because issues of law cannot be
specifically enjoins as a duty resulting from an office, resolved with finality by the administrative MARIA LOURDES P.A. SERENO
trust, or station, or unlawfully excludes another from officer.36 Appeal to the administrative officer would only Chief Justice
the use and enjoyment of a right or office to which such be an exercise in futility.37 Here, the question raised is
other is entitled, and there is no other plain, speedy and purely legal, i.e., what law should be applied in the
adequate remedy in the ordinary course of law, the payment of retirement benefits of petitioner's husband.
person aggrieved thereby may file a verified petition in Thus, there was no need to exhaust all administrative Footnotes
the proper court, alleging the facts with certainty and remedies before a judicial relief can be sought.
praying that judgment be rendered commanding the *Designated Acting Member, in lieu of Associate
respondent, immediately or at some other time to be WHEREFORE, the petition is GRANTED. The Justice Martin S. Villarama, Jr., per Raffle dated April
specified by the court, to do the act required to be done Decision dated May 25, 2009 and the Resolution dated 20, 2015.
to protect the rights of the petitioner, and to pay the September 10, 2009 of the Court of Appeals are
damages sustained by the petitioner by reason of the hereby REVERSED and SET ASIDE. The Decision 1
Penned by Associate Justice Jose C. Reyes, Jr., with
wrongful acts of the respondent. dated February 26, 2007 of the Regional Trial Court of Associate Justices Martin S. Villarama, Jr. (now a
Quezon City, Branch 220, is AFFIRMED. member of this Court) and Normandie B. Pizarro,
A writ of mandamus can be issued only when concurring; rollo, pp. 34-42.
petitioner’s legal right to the performance of a particular SO ORDERED.
2
act which is sought to be compelled is clear and Id. at 44-45.
DIOSDADO M. PERALTA
complete. A clear legal right is a right which is
Associate Justice 3 Id. at 65.
indubitably granted by law or is inferable as a matter of
law.29 A doctrine well-embedded in our jurisprudence WE CONCUR: 4AN ACT TO ESTABLISH A UNIFORM
is that mandamus will issue only when the petitioner RETIREMENT SYSTEM FOR THE ARMED FORCES
has a clear legal right to the performance of the act PRESBITERO J. VELASCO, JR. OF THE PHILIPPINES, TO PROVIDE FOR
sought to be compelled and the respondent has an Associate Justice SEPARATION THEREFROM, AND FOR OTHER
imperative duty to perform the same.30 The remedy of Chairperson PURPOSES
mandamus lies to compel the performance of a
ministerial duty.31 A purely ministerial act or duty is one JOSE PORTUGAL BIENVENIDO L. 5 Rollo, p. 66.
that an officer or tribunal performs in a given state of PEREZ* REYES
Associate Justice Associate Justice 6
facts, in a prescribed manner, in obedience to the Id. at 67.
mandate of a legal authority, without regard to or the
7
exercise of its own judgment upon the propriety or FRANCIS H. JARDELEZA Id. at 68-69; Termination of Pension Payments for
impropriety of the act done.32 If the law imposes a duty Associate Justice Retirees of RA 340 with Foreign Citizenship.
upon a public officer, and gives him the right to decide 8
ATTESTATION ESTABLISHING A NEW SYSTEM OF RETIREMENT
how or when the duty shall be performed, such duty is
AND SEPARATION FOR MILITARY PERSONNEL OF
discretionary and not ministerial.33 I attest that the conclusions in the above Decision had THE ARMED FORCES OF THE PHILIPPINES AND
been reached in consultation before the case was FOR OTHER PURPOSES.
The petition for mandamus filed by petitioner's
assigned to the writer of the opinion of the Court's
husband with the RTC was for the payment of his 9
Division. Rollo, pp. 51- 58.
terminated retirement benefits, which has become
vested, and being a ministerial duty on the part of the PRESBITERO J. VELASCO, JR. 10 Per Judge Jose G. Paneda; id. at 132-138.
respondents to pay such claim, mandamus is the Associate Justice
proper remedy to compel such payment. 11
Chairperson, Third Division Id. at 138.
The doctrine of exhaustion of administrative remedies 12
CERTIFICATION Id. at 140-148.
calls for resort first to the appropriate administrative
13
authorities in the resolution of a controversy falling Pursuant to Section 13, Article VIII of the Constitution Id. at 150.
under their jurisdiction before the same may be and the Division Chairperson's Attestation, I certify 14
elevated to the courts of justice for review.34 However, Id. (Emphasis in the original)
that the conclusions in the above Decision had been
30
15 36
Id. at 47. Id.
16 37
Id. at 42. (Emphasis in the original) Id.
17Buyco v. Philippine National Bank, 112 Phil. 588,
592 (1961), citing Lopez, et al. v. Crow,40 Phil. 997,
1007 (1919).
18Id., citing Montilla v. Agustinian Corp.,24 Phil. 220,
222 (1913).
19 551 Phil. 368 (2007)..
20 Parreño v. COA, supra, at 377.
21Buyco v. Philippine National Bank, supra, citing
Fairchild v. U.S., 91 Fed. 297; Hathaway v. Mutual Life
Ins. Co. of N.Y., 99 F. 534.
22Parreño v. Commission on Audit, supra note 19, at
377, citing Brion v. South Phil. Union Mission of 7th
Day Adventist Church, 366 Phil. 967, 975 (1999).
23
Id., citing Government Service Insurance System v.
Montesclaros, 478 Phil. 573, 584 (2004).
24 Id.
25 Id.
26 204 Phil. 126 (1982).
27 Ayog v. Cusi, supra, at 135.
28Republic v. Miller,365 Phil. 634, 638 (1999), citing
16A Am. Jur. 2d, Constitutional Law, 651.
29 Manila International Airport Authority v. Rivera
Village Lessee Homeowners Association Incorporated
,508 Phil. 354, 371 (2005).
30 Id.
31See Heirs of Spouses Venturillo v. Judge Quitain,
536 Phil. 839, 846 (2006).
32 Id.
33 Id.
34 Castro v. Gloria, 415 Phil. 645, 651 (2001).
35 Id. at 652.

31
 Decision 2 of the National Labor Relations Commission
(NLRC) dated March 31, 1998 dismissing petitioner’s
complaint for payment of disability and other benefits
for lack of merit and the Resolution 3 dated October 5,
2001 of the Court of Appeals denying petitioner’s
motion for reconsideration.
The antecedent facts are as follows:
In 1989, respondent NFD International Manning
Agents, Inc. hired the services of petitioner Roberto G.
Famanila as Messman 4 for Hansa Riga, a vessel
registered and owned by its principal and co-
respondent, Barbership Management Limited.
On June 21, 1990, while Hansa Riga was docked at
the port of Eureka, California, U.S.A. and while
petitioner was assisting in the loading operations, the
latter complained of a headache. Petitioner
experienced dizziness and he subsequently collapsed.
Upon examination, it was determined that he had a
sudden attack of left cerebral hemorrhage from a
ruptured cerebral aneurysm. 5 Petitioner underwent a
brain operation and he was confined at the Emmanuel
Hospital in Portland, Oregon, U.S.A. On July 19, 1990,
he underwent a second brain operation.
Owing to petitioner’s physical and mental condition, he
Republic of the Philippines was repatriated to the Philippines. On August 21, 1990,
SUPREME COURT he was examined at the American Hospital in
Manila Intramuros, Manila where the examining physician, Dr.
Patricia Abesamis declared that he "cannot go back to
FIRST DIVISION sea duty and has been observed for 120 days, he is
G.R. No. 150429 August 29, 2006 being declared permanently, totally disabled." 6
appealed the decision with the NLRC. On March 31,
1998, the NLRC promulgated its decision 10 finding the
appeal to be without merit and ordered its dismissal.
When the motion for reconsideration 11 was denied by
the NLRC in its resolution dated June 29,
1998, 12 petitioner filed a petition for certiorari with this
Court. On December 2, 1998, we resolved to refer the
case to the Court of Appeals pursuant to our ruling
in St. Martin Funeral Home v. National Labor Relations
Commission. 13
On March 30, 2001, the Court of Appeals promulgated
the assailed decision which dismissed the petition for
lack of merit. Petitioner’s motion for reconsideration
was denied, hence, the present petition for review
raising the following issues:
I. THE COURT OF APPEALS COMMITTED GRAVE
ABUSE OF DISCRETION AMOUNTING TO LACK OR
EXCESS OF JURISDICTION IN UPHOLDING THE
VALIDITY OF THE RECEIPT AND RELEASE SINCE
PETITIONER’S CONSENT THERETO WAS
VITIATED THEREBY MAKING THE SAME VOID AND
UNENFORCEABLE.
II. THE COURT OF APPEALS COMMITTED GRAVE
ABUSE OF DISCRETION AMOUNTING TO LACK OR
EXCESS OF JURISDICTION IN HOLDING THAT THE
PRESCRIPTION PERIOD APPLICABLE TO THE
CLAIM OF THE PETITIONER IS THE 3-YEAR
PERIOD PROVIDED FOR UNDER THE LABOR
CODE OF THE PHILIPPINES AND NOT THE 10-
YEAR PERIOD PROVIDED FOR UNDER THE CIVIL
CODE.

ROBERTO G. FAMANILA, Petitioner,
vs.
THE COURT OF APPEALS (Spc. Fmr. Seventh
Division) and BARBERSHIP MANAGEMENT
LIMITED and NFD INTERNATIONAL MANNING
AGENTS, INC. Respondents.
DECISION
YNARES-SANTIAGO, J.:
Before us is a petition for review on certiorari assailing
the Decision 1 of the Court of Appeals in CA-G.R. SP
No. 50615 dated March 30, 2001 which affirmed the
Thereafter, authorized representatives of the
respondents convinced him to settle his claim amicably
by accepting the amount of US$13,200. 7 Petitioner
accepted the offer as evidenced by his signature in the
Receipt and Release dated February 28, 1991. 8 His
wife, Gloria Famanila and one Richard Famanila, acted
as witnesses in the signing of the release.
On June 11, 1997, petitioner filed a complaint 9 with the
NLRC which was docketed as NLRC OCW Case No.
6-838-97-L praying for an award of disability benefits,
share in the insurance proceeds, moral damages and
attorney’s fees. On September 29, 1997, Acting
Executive Labor Arbiter Voltaire A. Balitaan dismissed
the complaint on the ground of prescription. Petitioner
Petitioner claims that he did not sign the Receipt and
Release voluntarily or freely because he was
permanently disabled and in financial constraints.
These factors allegedly vitiated his consent which
makes the Receipt and Release void and
unenforceable.
The petition lacks merit.
It is fundamental that the scope of the Supreme Court’s
judicial review under Rule 45 of the Rules of Court is
confined only to errors of law. It does not extend to
questions of fact. More so in labor cases where the
doctrine applies with greater force. 14 The Labor Arbiter
and the NLRC have already determined the factual
32
issues, and these were affirmed by the Court of
Appeals. Thus, they are accorded not only great
respect but also finality and are deemed binding upon
this Court so long as they are supported by substantial
evidence. 15 We reviewed the records of the case and
we find no reason to deviate from the findings of the
labor arbiter, NLRC and the Court of Appeals.
A vitiated consent does not make a contract void and
unenforceable. A vitiated consent only gives rise to a
voidable agreement. Under the Civil Code, the vices of
consent are mistake, violence, intimidation, undue
influence or fraud. 16 If consent is given through any of
the aforementioned vices of consent, the contract is
voidable. 17 A voidable contract is binding unless
annulled by a proper action in court. 18
Petitioner contends that his permanent and total
disability vitiated his consent to the Receipt and
Release thereby rendering it void and unenforceable.
However, disability is not among the factors that may
vitiate consent. Besides, save for petitioner’s self-
serving allegations, there is no proof on record that his
consent was vitiated on account of his disability. In the
absence of such proof of vitiated consent, the validity
of the Receipt and Release must be upheld. We agree
with the findings of the Court of Appeals that:
In the case at bar, there is nothing in the records to
show that petitioner’s consent was vitiated when he
signed the agreement. Granting that petitioner has not
fully recovered his health at the time he signed the
subject document, the same cannot still lead to the
conclusion that he did not voluntar[il]y accept the
agreement, for his wife and another relative witnessed
his signing.
Moreover, the document entitled receipt and release
which was attached by petitioner in his appeal does not
show on its face any violation of law or public policy. In
fact, petitioner did not present any proof to show that
the consideration for the same is not reasonable and
acceptable. Absent any evidence to support the same,
the Court cannot, on its own accord, decide against the
unreasonableness of the consideration. 19
It is true that quitclaims and waivers are oftentimes
frowned upon and are considered as ineffective in
barring recovery for the full measure of the worker’s
right and that acceptance of the benefits therefrom
does not amount to estoppel. 20 The reason is plain.
Employer and employee, obviously do not stand on the
same footing. 21However, not all waivers and
quitclaims are invalid as against public policy. If the
agreement was voluntarily entered into and represents
a reasonable settlement, it is binding on the parties and
may not later be disowned simply because of change
of mind. It is only where there is clear proof that the
waiver was wangled from an unsuspecting or gullible
person, or the terms of the settlement are
unconscionable on its face, that the law will step in to
annul the questionable transaction. But where it is
shown that the person making the waiver did so
voluntarily, with full understanding of what he was
doing, and the consideration for the quitclaim is
credible and reasonable, the transaction must be
recognized as a valid and binding undertaking, 22 as in
this case.
To be valid and effective, waivers must be couched in
clear and unequivocal terms, leaving no doubt as to the
intention of those giving up a right or a benefit that
legally pertains to them. 23 We have reviewed the
terms and conditions contained in the Receipt and
Release and we find the same to be clear and
unambiguous. The signing was even witnessed by
petitioner’s wife, Gloria T. Famanila and one Richard
T. Famanila. The Receipt and Release provides in part:
That for and in consideration of the sum of THIRTEEN
THOUSAND TWO HUNDRED DOLLARS
(US$13,200.00) or its equivalent in Philippine currency
THREE HUNDRED SIXTY FIVE THOUSAND NINE
HUNDRED FOUR PESOS (365,904.00), the receipt of
which is hereby acknowledged to my full and complete
satisfaction x x x I, ROBERTO G. FAMANILA, x x x
hereby remise, release and forever discharge said
vessel "HANSA RIGA", her Owners, operators,
managers, charterers, agents, underwriters, P and I
Club, master, officers, and crew and all parties at
interest therein or thereon, whether named or not
named, including but not limited to BARBER SHIP
MANAGEMENT LIMITED, NFD INTERNATIONAL
MANNING AGENTS, INC. and
ASSURANCEFORENIGEN GARD from any and all
claims, demands, debts, dues, liens, actions or causes
of action, at law or in equity, in common law or in
admiralty, statutory or contractual, arising from and
under the laws of the United States of America,
Norway, Hongkong or the Republic of the Philippines
and/or any other foreign country now held, owned or
possessed by me or by any person or persons, arising
from or related to or concerning whether directly or
indirectly, proximately or remotely, without being
limited to but including the said illness suffered by me
on board the vessel "HANSA RIGA" on or about 21st
June 1990 at Portland, Oregon and disability
compensation in connection therewith.
This instrument is a GENERAL RELEASE intended to
release all liabilities of any character and/or claims or
damages and/or losses and/or any other liabilities
whatsoever, whether contractual or statutory, at
common law or in equity, tortious or in admiralty, now
or henceforth in any way related to or occurring as a
consequence of the illness suffered by me as
Messman of the vessel "HANSA RIGA", including but
not limited to all damages and/or losses consisting of
loss of support, loss of earning capacity, loss of all
benefits of whatsoever nature and extent incurred,
physical pain and suffering and/or all damages and/or
indemnities claimable in law, tort, contract, common
law, equity and/or admiralty by me or by any person or
persons pursuant to the laws of the United States of
America, Norway, Hongkong or the Republic of the
Philippines and of all other countries whatsoever.
I hereby certify that I am of legal age and that I fully
understand this instrument which was read to me in the
local dialect and I agree that this is a FULL AND FINAL
RELEASE AND DISCHARGE of all parties and things
referred to herein, and I further agree that this release
may be pleaded as an absolute and final bar to any suit
or suits or legal proceedings that may hereafter be
prosecuted by me or by any one claiming by, through,
or under me, against any of the persons or things
referred to or related herein, for any matter or thing
referred to or related herein. 24
It is elementary that a contract is perfected by mere
consent and from that moment the parties are bound
not only to the fulfillment of what has been expressly
stipulated but also to all the consequences which,
according to their nature, may be in keeping with good
faith, usage and law. 25 Further, dire necessity is not an
acceptable ground for annulling the Receipt and
Release since it has not been shown that petitioner
was forced to sign it. 26
33
 MINITA V. CHICO-NAZARIO 16
Regarding prescription, the applicable prescriptive CIVIL CODE, Art. 1330.
period for the money claims against the respondents is Associate Justice
17
the three year period pursuant to Article 291 of the Jurado, Comments and Jurisprudence on
Labor Code which provides that: CERTIFICATION Obligations and Contracts, 1993 Ed., p. 571, citing 8
Manresa, 5th Ed., Bk. 2, p. 426.
ART. 291. Money Claims. – All money claims arising Pursuant to Section 13, Article VIII of the Constitution,
18 CIVIL CODE, Art. 1390.
from employer-employee relations accruing during the it is hereby certified that the conclusions in the above
effectivity of this Code shall be filed within three (3) Decision were reached in consultation before the
19
case was assigned to the writer of the opinion of the Rollo, p. 39.
years from the time the cause of action accrued;
otherwise they shall be forever barred. Court’s Division. 20Galicia v. National Labor Relations Commission,
ARTEMIO V. PANGANIBAN G.R. No. 119649, July 28, 1997, 276 SCRA 381, 387.
xxxx
Chief Justice 21
Lopez Sugar Corporation v. Federation of Free
Since petitioner’s demand for an award of disability
Workers, G.R. Nos. 75700-01, August 30, 1990, 189
benefits is a money claim arising from his employment,
SCRA 179, 193.
Article 291 of the Labor Code applies. From the time
petitioner was declared permanently and totally 22Periquet v. National Labor Relations Commission,
Footnotes
disabled on August 21, 1990 which gave rise to his G.R. No. 91298, June 22, 1990, 186 SCRA 724, 730-
entitlement to disability benefits up to the time that he 1Rollo, pp. 35-41. Penned by Associate Justice 731.
filed the complaint on June 11, 1997, more than three Ramon A. Barcelona and concurred in by Associate
years have elapsed thereby effectively barring his Justices Rodrigo V. Cosico and Alicia L. Santos.
23Insular Life Assurance Company, Ltd. v. Asset
claim. Builders Corporation, G.R. No. 147410, February 5,
2 CA rollo, pp. 32-36. 2004, 422 SCRA 148, 166.
WHEREFORE, the petition is DENIED. The Decision
of the Court of Appeals dated March 30, 2001 in CA- 3 24
Rollo, pp. 49-51. CA rollo, pp. 55-56.
G.R. SP No. 50615 which affirmed the Decision of the
4 25
National Labor Relations Commission dismissing CA rollo, p. 48. CIVIL CODE, Art. 1315.
petitioner’s complaint for disability and other benefits 5 26
for lack of merit, and Id. at 54. Veloso v. Department of Labor and Employment,
G.R. No. 87297, August 5, 1991, 200 SCRA 201, 205.
6
the Resolution dated October 5, 2001 denying the Id.
motion for reconsideration, are AFFIRMED. 7 Rollo, p. 11.
SO ORDERED. 8 CA rollo, pp. 55-57.
CONSUELO YNARES-SANTIAGO 9 Id. at 59-60.
Associate Justice 10 Id. at 32-36.
WE CONCUR: 11 Id. at 37-42.
ARTEMIO V. PANGANIBAN 12 Id. at 43-46.
Chief Justice 13G.R. No. 130866, September 16, 1998, 295 SCRA
Chairperson 494.
MA. ALICIA AUSTRIA-MARTINEZ, ROMEO J. 14Philippine National Bank v. Cabansag, G.R. No.
CALLEJO, SR.
157010, June 21, 2005, 460 SCRA 514, 525.
Associate Justice Associate Justice 15Skippers United Pacific, Inc. v. National Labor
Relations Commission, G.R. No. 148893, July 12,
2006.
34
 On June 13, 1997, private respondent-minors Karen
Oanes Wei and Kamille Oanes Wei, represented by
their mother Remedios Oanes (Remedios), filed a
petition for letters of administration5 before the
Regional Trial Court of Makati City, Branch 138. The
case was docketed as Sp. Proc. No. 4549 and
entitled Intestate Estate of Sima Wei (a.k.a. Rufino
Guy Susim).
Private respondents alleged that they are the duly
acknowledged illegitimate children of Sima Wei, who
died intestate in Makati City on October 29, 1992,
leaving an estate valued at P10,000,000.00 consisting
of real and personal properties. His known heirs are his
surviving spouse Shirley Guy and children, Emy,
Jeanne, Cristina, George and Michael, all surnamed
Guy. Private respondents prayed for the appointment
of a regular administrator for the orderly settlement of
Sima Wei's estate. They likewise prayed that, in the
Republic of the Philippines
meantime, petitioner Michael C. Guy, son of the
SUPREME COURT
decedent, be appointed as Special Administrator of the
Manila
estate. Attached to private respondents' petition was a
Certification Against Forum Shopping6 signed by their
FIRST DIVISION
counsel, Atty. Sedfrey A. Ordoñez.
G.R. No. 163707 September 15, 2006 In his Comment/Opposition,7 petitioner prayed for the
dismissal of the petition. He asserted that his deceased
MICHAEL C. GUY, petitioner,
vs. father left no debts and that his estate can be settled
without securing letters of administration pursuant to
HON. COURT OF APPEALS, HON. SIXTO
MARELLA, JR., Presiding Judge, RTC, Branch Section 1, Rule 74 of the Rules of Court. He further
138, Makati City and minors, KAREN DANES WEI argued that private respondents should have
and KAMILLE DANES WEI, represented by their established their status as illegitimate children during
mother, REMEDIOS OANES, respondents. the lifetime of Sima Wei pursuant to Article 175 of the
Family Code.
DECISION
The other heirs of Sima Wei filed a Joint Motion to
YNARES-SANTIAGO, J.: Dismiss8 on the ground that the certification against
forum shopping should have been signed by private
This petition for review on certiorari assails the January respondents and not their counsel. They contended
22, 2004 Decision1 of the Court of Appeals in CA-G.R. that Remedios should have executed the certification
SP No. 79742, which affirmed the Orders dated July on behalf of her minor daughters as mandated by
21, 20002 and July 17, 20033 of the Regional Trial Section 5, Rule 7 of the Rules of Court.
Court of Makati City, Branch 138 in SP Proc. Case No.
4549 denying petitioner's motion to dismiss; and its In a Manifestation/Motion as Supplement to the Joint
May 25, 2004 Resolution4 denying petitioner's motion Motion to Dismiss,9 petitioner and his co-heirs alleged
for reconsideration. that private respondents' claim had been paid, waived,
abandoned or otherwise extinguished by reason of
The facts are as follows: Remedios' June 7, 1993 Release and Waiver of Claim
stating that in exchange for the financial and
educational assistance received from petitioner,
Remedios and her minor children discharge the estate
of Sima Wei from any and all liabilities.
The Regional Trial Court denied the Joint Motion to
Dismiss as well as the Supplemental Motion to
Dismiss. It ruled that while the Release and Waiver of
Claim was signed by Remedios, it had not been
established that she was the duly constituted guardian
of her minor daughters. Thus, no renunciation of right
occurred. Applying a liberal application of the rules, the
trial court also rejected petitioner's objections on the
certification against forum shopping.
Petitioner moved for reconsideration but was denied.
He filed a petition for certiorari before the Court of
Appeals which affirmed the orders of the Regional Trial
Court in its assailed Decision dated January 22, 2004,
the dispositive portion of which states:
WHEREFORE, premises considered, the present
petition is hereby DENIED DUE COURSE and
accordingly DISMISSED, for lack of merit.
Consequently, the assailed Orders dated July 21, 2000
and July 17, 2003 are hereby both AFFIRMED.
Respondent Judge is hereby DIRECTED to resolve the
controversy over the illegitimate filiation of the private
respondents (sic) minors [-] Karen Oanes Wei and
Kamille Oanes Wei who are claiming successional
rights in the intestate estate of the deceased Sima Wei,
a.k.a. Rufino Guy Susim.
SO ORDERED.10
The Court of Appeals denied petitioner's motion for
reconsideration, hence, this petition.
Petitioner argues that the Court of Appeals disregarded
existing rules on certification against forum shopping;
that the Release and Waiver of Claim executed by
Remedios released and discharged the Guy family and
the estate of Sima Wei from any claims or liabilities;
and that private respondents do not have the legal
personality to institute the petition for letters of
administration as they failed to prove their filiation
during the lifetime of Sima Wei in accordance with
Article 175 of the Family Code.
Private respondents contend that their counsel's
certification can be considered substantial compliance
with the rules on certification of non-forum shopping,
and that the petition raises no new issues to warrant
35
the reversal of the decisions of the Regional Trial Court
and the Court of Appeals.
The issues for resolution are: 1) whether private
respondents' petition should be dismissed for failure to
comply with the rules on certification of non-forum
shopping; 2) whether the Release and Waiver of Claim
precludes private respondents from claiming their
successional rights; and 3) whether private
respondents are barred by prescription from proving
their filiation.
The petition lacks merit.
Rule 7, Section 5 of the Rules of Court provides that
the certification of non-forum shopping should be
executed by the plaintiff or the principal party. Failure
to comply with the requirement shall be cause for
dismissal of the case. However, a liberal application of
the rules is proper where the higher interest of justice
would be served. InSy Chin v. Court of Appeals,11 we
ruled that while a petition may have been flawed where
the certificate of non-forum shopping was signed only
by counsel and not by the party, this procedural lapse
may be overlooked in the interest of substantial
justice.12 So it is in the present controversy where the
merits13 of the case and the absence of an intention to
violate the rules with impunity should be considered as
compelling reasons to temper the strict application of
the rules.
As regards Remedios' Release and Waiver of Claim,
the same does not bar private respondents from
claiming successional rights. To be valid and effective,
a waiver must be couched in clear and unequivocal
terms which leave no doubt as to the intention of a
party to give up a right or benefit which legally pertains
to him. A waiver may not be attributed to a person when
its terms do not explicitly and clearly evince an intent
to abandon a right.14
In this case, we find that there was no waiver of
hereditary rights. The Release and Waiver of Claim
does not state with clarity the purpose of its execution.
It merely states that Remedios received P300,000.00
and an educational plan for her minor daughters "by
way of financial assistance and in full settlement of any
and all claims of whatsoever nature and kind x x x
against the estate of the late Rufino Guy
Susim."15 Considering that the document did not
specifically mention private respondents' hereditary
share in the estate of Sima Wei, it cannot be construed
as a waiver of successional rights.
Moreover, even assuming that Remedios truly waived
the hereditary rights of private respondents, such
waiver will not bar the latter's claim. Article 1044 of the
Civil Code, provides:
ART. 1044. Any person having the free disposal of his
property may accept or repudiate an inheritance.
Any inheritance left to minors or incapacitated
persons may be accepted by their parents or
guardians. Parents or guardians may repudiate the
inheritance left to their wards only by judicial
authorization.
The right to accept an inheritance left to the poor shall
belong to the persons designated by the testator to
determine the beneficiaries and distribute the property,
or in their default, to those mentioned in Article 1030.
(Emphasis supplied)
Parents and guardians may not therefore repudiate the
inheritance of their wards without judicial approval.
This is because repudiation amounts to an alienation
of property16 which must pass the court's scrutiny in
order to protect the interest of the ward. Not having
been judicially authorized, the Release and Waiver of
Claim in the instant case is void and will not bar private
respondents from asserting their rights as heirs of the
deceased.
Furthermore, it must be emphasized that waiver is the
intentional relinquishment of a known right. Where one
lacks knowledge of a right, there is no basis upon which
waiver of it can rest. Ignorance of a material fact
negates waiver, and waiver cannot be established by a
consent given under a mistake or misapprehension of
fact.17
In the present case, private respondents could not
have possibly waived their successional rights
because they are yet to prove their status as
acknowledged illegitimate children of the deceased.
Petitioner himself has consistently denied that private
respondents are his co-heirs. It would thus be
inconsistent to rule that they waived their hereditary
rights when petitioner claims that they do not have such
right. Hence, petitioner's invocation of waiver on the
part of private respondents must fail.
Anent the issue on private respondents' filiation, we
agree with the Court of Appeals that a ruling on the
same would be premature considering that private
respondents have yet to present evidence. Before the
Family Code took effect, the governing law on actions
for recognition of illegitimate children was Article 285 of
the Civil Code, to wit:
ART. 285. The action for the recognition of natural
children may be brought only during the lifetime of the
presumed parents, except in the following cases:
(1) If the father or mother died during the minority
of the child, in which case the latter may file the
action before the expiration of four years from the
attainment of his majority;
(2) If after the death of the father or of the mother a
document should appear of which nothing had been
heard and in which either or both parents recognize the
child.
In this case, the action must be commenced within four
years from the finding of the document. (Emphasis
supplied)
We ruled in Bernabe v. Alejo18 that illegitimate children
who were still minors at the time the Family Code took
effect and whose putative parent died during their
minority are given the right to seek recognition for a
period of up to four years from attaining majority age.
This vested right was not impaired or taken away by
the passage of the Family Code.19
On the other hand, Articles 172, 173 and 175 of the
Family Code, which superseded Article 285 of the Civil
Code, provide:
ART. 172. The filiation of legitimate children is
established by any of the following:
(1) The record of birth appearing in the civil register or
a final judgment; or
(2) An admission of legitimate filiation in a public
document or a private handwritten instrument and
signed by the parent concerned.
36
In the absence of the foregoing evidence, the
legitimate filiation shall be proved by:
(1) The open and continuous possession of the status
of a legitimate child; or
(2) Any other means allowed by the Rules of Court and
special laws.
ART. 173. The action to claim legitimacy may be
brought by the child during his or her lifetime and shall
be transmitted to the heirs should the child die during
minority or in a state of insanity. In these cases, the
heirs shall have a period of five years within which to
institute the action.
The action already commenced by the child shall
survive notwithstanding the death of either or both of
the parties.
ART. 175. Illegitimate children may establish their
illegitimate filiation in the same way and on the same,
evidence as legitimate children.
The action must be brought within the same period
specified in Article 173, except when the action is
based on the second paragraph of Article 172, in which
case the action may be brought during the lifetime of
the alleged parent.
Under the Family Code, when filiation of an illegitimate
child is established by a record of birth appearing in the
civil register or a final judgment, or an admission of
filiation in a public document or a private handwritten
instrument signed by the parent concerned, the action
for recognition may be brought by the child during his
or her lifetime. However, if the action is based upon
open and continuous possession of the status of an
illegitimate child, or any other means allowed by the
rules or special laws, it may only be brought during the
lifetime of the alleged parent.
It is clear therefore that the resolution of the issue of
prescription depends on the type of evidence to be
adduced by private respondents in proving their
filiation. However, it would be impossible to determine
the same in this case as there has been no reception
of evidence yet. This Court is not a trier of facts. Such
matters may be resolved only by the Regional Trial
Court after a full-blown trial.
While the original action filed by private respondents the court; and the declaration of heirship is appropriate
was a petition for letters of administration, the trial court to such proceedings.
is not precluded from receiving evidence on private
respondents' filiation. Its jurisdiction extends to matters WHEREFORE, the instant petition is DENIED. The
incidental and collateral to the exercise of its Decision dated January 22, 2004 of the Court of
recognized powers in handling the settlement of the Appeals in CA-G.R. SP No. 79742 affirming the denial
of petitioner's motion to dismiss; and its Resolution
estate, including the determination of the status of each
dated May 25, 2004 denying petitioner's motion for
heir.20 That the two causes of action, one to compel
recognition and the other to claim inheritance, may be reconsideration, are AFFIRMED. Let the records
joined in one complaint is not new in our be REMANDED to the Regional Trial Court of Makati
jurisprudence.21 As held in Briz v. Briz:22 City, Branch 138 for further proceedings.
SO ORDERED.
The question whether a person in the position of the
present plaintiff can in any event maintain a complex
Panganiban, C.J., Chairperson, Austria-Martinez,
action to compel recognition as a natural child and at
Callejo, Sr., Chico-Nazario, J.J., concur.
the same time to obtain ulterior relief in the character
of heir, is one which in the opinion of this court must be
answered in the affirmative, provided always that the
conditions justifying the joinder of the two distinct
causes of action are present in the particular case. In Footnotes
other words, there is no absolute necessity requiring
1
that the action to compel acknowledgment should have Rollo, pp. 19-26. Penned by Associate Justice Martin
been instituted and prosecuted to a successful S. Villarama, Jr. and concurred in by Associate
conclusion prior to the action in which that same Justices Mario L. Guariña III and Jose C. Reyes, Jr.
plaintiff seeks additional relief in the character of heir. 2
Certainly, there is nothing so peculiar to the action to Id. at 48-49. Penned by Judge Sixto Marella, Jr.
compel acknowledgment as to require that a rule 3 Id. at 53.
should be here applied different from that generally
applicable in other cases. x x x 4 Id. at 28.
The conclusion above stated, though not heretofore 5 Id. at 29-31.
explicitly formulated by this court, is undoubtedly to
some extent supported by our prior decisions. Thus, 6 Id. at 31.
we have held in numerous cases, and the doctrine 7
must be considered well settled, that a natural child Id. at 35-36.
having a right to compel acknowledgment, but who has 8
Id. at 37-41.
not been in fact acknowledged, may maintain partition
proceedings for the division of the inheritance against 9 Id. at 42-44.
his coheirs (Siguiong vs. Siguiong, 8 Phil., 5; Tiamson
vs. Tiamson, 32 Phil., 62); and the same person may 10 Id. at 25.
intervene in proceedings for the distribution of the
estate of his deceased natural father, or mother
11 399 Phil. 442 (2000).
(Capistrano vs. Fabella, 8 Phil., 135; Conde vs. Abaya, 12
13 Phil., 249; Ramirez vs. Gmur, 42 Phil., 855). In Id. at 454.
neither of these situations has it been thought 13
Twin Towers Condominium Corporation v. Court of
necessary for the plaintiff to show a prior decree Appeals, G.R. No. 123552, February 27, 2003, 398
compelling acknowledgment. The obvious reason is
SCRA 203, 212.
that in partition suits and distribution proceedings the
other persons who might take by inheritance are before
37
14Thomson v. Court of Appeals, 358 Phil. 761, 778
(1998).
15 Rollo, p. 44.
16Tolentino, Civil Code of the Philippines, Vol. III, p.
554.
17D.M. Consunji, Inc. v. Court of Appeals, G.R. No.
137873, April 20, 2001, 357 SCRA 249, 266.
18 424 Phil. 933 (2002).
19 Id. at 944.
20Borromeo-Herrera v. Borromeo, G.R. Nos. L-41171,
L-55000, L-62895, L-63818 and L-65995, July 23,
1987, 152 SCRA 171, 182-183.
21Tayag v.Court of Appeals, G.R. No. 95229, June 9,
1992, 209 SCRA 665, 672.
22 43 Phil. 763, 768-769 (1922).

38
 When God created man, He made him in the likeness
of God; He created them male and female. (Genesis
5:1-2)
Amihan gazed upon the bamboo reed planted by
Bathala and she heard voices coming from inside the
bamboo. "Oh North Wind! North Wind! Please let us
out!," the voices said. She pecked the reed once, then
twice. All of a sudden, the bamboo cracked and slit
open. Out came two human beings; one was a male
and the other was a female. Amihan named the man
"Malakas" (Strong) and the woman "Maganda"
(Beautiful). (The Legend of Malakas and Maganda)
When is a man a man and when is a woman a woman?
In particular, does the law recognize the changes made
by a physician using scalpel, drugs and counseling with
regard to a person’s sex? May a person successfully
petition for a change of name and sex appearing in the
birth certificate to reflect the result of a sex
reassignment surgery?
On November 26, 2002, petitioner Rommel Jacinto
Dantes Silverio filed a petition for the change of his first
name and sex in his birth certificate in the Regional
Trial Court of Manila, Branch 8. The petition, docketed
as SP Case No. 02-105207, impleaded the civil
registrar of Manila as respondent.
Petitioner alleged in his petition that he was born in the
City of Manila to the spouses Melecio Petines Silverio
and Anita Aquino Dantes on April 4, 1962. His name
was registered as "Rommel Jacinto Dantes Silverio" in
his certificate of live birth (birth certificate). His sex was
registered as "male."
Republic of the Philippines He further alleged that he is a male transsexual, that
SUPREME COURT is, "anatomically male but feels, thinks and acts as a
Manila female" and that he had always identified himself with
girls since childhood.1 Feeling trapped in a man’s body,
FIRST DIVISION he consulted several doctors in the United States. He
underwent psychological examination, hormone
G.R. No. 174689 October 22, 2007 treatment and breast augmentation. His attempts to
transform himself to a "woman" culminated on January
ROMMEL JACINTO DANTES SILVERIO, petitioner, 27, 2001 when he underwent sex reassignment
vs. surgery2 in Bangkok, Thailand. He was thereafter
REPUBLIC OF THE PHILIPPINES, respondent. examined by Dr. Marcelino Reysio-Cruz, Jr., a plastic
DECISION and reconstruction surgeon in the Philippines, who
issued a medical certificate attesting that he (petitioner)
CORONA, J.: had in fact undergone the procedure.
From then on, petitioner lived as a female and was in
fact engaged to be married. He then sought to have his
name in his birth certificate changed from "Rommel
Jacinto" to "Mely," and his sex from "male" to "female."
An order setting the case for initial hearing was
published in the People’s Journal Tonight, a
newspaper of general circulation in Metro Manila, for
three consecutive weeks.3 Copies of the order were
sent to the Office of the Solicitor General (OSG) and
the civil registrar of Manila.
On the scheduled initial hearing, jurisdictional
requirements were established. No opposition to the
petition was made.
During trial, petitioner testified for himself. He also
presented Dr. Reysio-Cruz, Jr. and his American
fiancé, Richard P. Edel, as witnesses.
On June 4, 2003, the trial court rendered a decision 4 in
favor of petitioner. Its relevant portions read:
Petitioner filed the present petition not to evade any law
or judgment or any infraction thereof or for any unlawful
motive but solely for the purpose of making his birth
records compatible with his present sex.
The sole issue here is whether or not petitioner is
entitled to the relief asked for.
The [c]ourt rules in the affirmative.
Firstly, the [c]ourt is of the opinion that granting the
petition would be more in consonance with the
principles of justice and equity. With his sexual [re-
assignment], petitioner, who has always felt, thought
and acted like a woman, now possesses the physique
of a female. Petitioner’s misfortune to be trapped in a
man’s body is not his own doing and should not be in
any way taken against him.
Likewise, the [c]ourt believes that no harm, injury [or]
prejudice will be caused to anybody or the community
in granting the petition. On the contrary, granting the
petition would bring the much-awaited happiness on
the part of the petitioner and her [fiancé] and the
realization of their dreams.
Finally, no evidence was presented to show any cause
or ground to deny the present petition despite due
39
notice and publication thereof. Even the State, through
the [OSG] has not seen fit to interpose any [o]pposition.
WHEREFORE, judgment is hereby rendered
GRANTING the petition and ordering the Civil
Registrar of Manila to change the entries appearing in
the Certificate of Birth of [p]etitioner, specifically for
petitioner’s first name from "Rommel Jacinto"
to MELY and petitioner’s gender from "Male"
to FEMALE. 5
On August 18, 2003, the Republic of the Philippines
(Republic), thru the OSG, filed a petition for certiorari
in the Court of Appeals.6 It alleged that there is no law
allowing the change of entries in the birth certificate by
reason of sex alteration.
On February 23, 2006, the Court of Appeals7 rendered
a decision8 in favor of the Republic. It ruled that the trial
court’s decision lacked legal basis. There is no law
allowing the change of either name or sex in the
certificate of birth on the ground of sex reassignment
through surgery. Thus, the Court of Appeals granted
the Republic’s petition, set aside the decision of the
trial court and ordered the dismissal of SP Case No.
02-105207. Petitioner moved for reconsideration but it
was denied.9 Hence, this petition.
Petitioner essentially claims that the change of his
name and sex in his birth certificate is allowed under
Articles 407 to 413 of the Civil Code, Rules 103 and
108 of the Rules of Court and RA 9048.10
The petition lacks merit.
A Person’s First Name Cannot Be Changed On the
Ground of Sex Reassignment
Petitioner invoked his sex reassignment as the ground
for his petition for change of name and sex. As found
by the trial court:
Petitioner filed the present petition not to evade any law
or judgment or any infraction thereof or for any unlawful
motive but solely for the purpose of making his
birth records compatible with his present sex.
(emphasis supplied)
Petitioner believes that after having acquired the
physical features of a female, he became entitled to the
civil registry changes sought. We disagree.
The State has an interest in the names borne by
individuals and entities for purposes of
identification.11 A change of name is a privilege, not a
right.12 Petitions for change of name are controlled by
statutes.13 In this connection, Article 376 of the Civil
Code provides:
ART. 376. No person can change his name or surname
without judicial authority.
This Civil Code provision was amended by RA 9048
(Clerical Error Law). In particular, Section 1 of RA 9048
provides:
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.
RA 9048 now governs the change of first name.14 It
vests the power and authority to entertain petitions for
change of first name to the city or municipal civil
registrar or consul general concerned. Under the law,
therefore, jurisdiction over applications for change of
first name is now primarily lodged with the
aforementioned administrative officers. The intent and
effect of the law is to exclude the change of first name
from the coverage of Rules 103 (Change of Name) and
108 (Cancellation or Correction of Entries in the Civil
Registry) of the Rules of Court, until and unless an
administrative petition for change of name is first filed
and subsequently denied.15 It likewise lays down the
corresponding venue,16 form17 and procedure. In sum,
the remedy and the proceedings regulating change of
first name are primarily administrative in nature, not
judicial.
RA 9048 likewise provides the grounds for which
change of first name may be allowed:
SECTION 4. Grounds for Change of First Name or
Nickname. – The petition for change of first name or
nickname may be allowed in any of the following cases:
(1) The petitioner finds the first name or nickname to
be ridiculous, tainted with dishonor or extremely
difficult to write or pronounce;
(2) The new first name or nickname has been habitually
and continuously used by the petitioner and he has
been publicly known by that first name or nickname in
the community; or
(3) The change will avoid confusion.
Petitioner’s basis in praying for the change of his first
name was his sex reassignment. He intended to make
his first name compatible with the sex he thought he
transformed himself into through surgery. However, a
change of name does not alter one’s legal capacity or
civil status.18 RA 9048 does not sanction a change of
first name on the ground of sex reassignment. Rather
than avoiding confusion, changing petitioner’s first
name for his declared purpose may only create grave
complications in the civil registry and the public
interest.
Before a person can legally change his given name, he
must present proper or reasonable cause or any
compelling reason justifying such change.19 In
addition, he must show that he will be prejudiced by the
use of his true and official name.20 In this case, he
failed to show, or even allege, any prejudice that he
might suffer as a result of using his true and official
name.
In sum, the petition in the trial court in so far as it prayed
for the change of petitioner’s first name was not within
that court’s primary jurisdiction as the petition should
have been filed with the local civil registrar concerned,
assuming it could be legally done. It was an improper
remedy because the proper remedy was
administrative, that is, that provided under RA 9048. It
was also filed in the wrong venue as the proper venue
was in the Office of the Civil Registrar of Manila where
his birth certificate is kept. More importantly, it had no
merit since the use of his true and official name does
not prejudice him at all. For all these reasons, the Court
of Appeals correctly dismissed petitioner’s petition in
so far as the change of his first name was concerned.
No Law Allows The Change of Entry In The Birth
Certificate As To Sex On the Ground of Sex
Reassignment
40
The determination of a person’s sex appearing in his
birth certificate is a legal issue and the court must look
to the statutes.21 In this connection, Article 412 of the
Civil Code provides:
ART. 412. No entry in the civil register shall be changed
or corrected without a judicial order.
Together with Article 376 of the Civil Code, this
provision was amended by RA 9048 in so far as clerical
or typographical errors are involved. The correction or
change of such matters can now be made through
administrative proceedings and without the need for a
judicial order. In effect, RA 9048 removed from the
ambit of Rule 108 of the Rules of Court the correction
of such errors.22 Rule 108 now applies only to
substantial changes and corrections in entries in the
civil register.23
Section 2(c) of RA 9048 defines what a "clerical or
typographical error" is:
SECTION 2. Definition of Terms. – As used in this Act,
the following terms shall mean:
xxx xxx xxx
(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 existing record or
records: Provided, however, That no correction must
involve the change of nationality, age, status
or sex of the petitioner. (emphasis supplied)
Under RA 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.
The entries envisaged in Article 412 of the Civil Code
and correctable under Rule 108 of the Rules of Court
are those provided in Articles 407 and 408 of the Civil
Code:24
ART. 407. Acts, events and judicial decrees
concerning the civil status of persons shall be recorded
in the civil register.
ART. 408. The following shall be entered in the civil
register:
(1) Births; (2) marriages; (3) deaths; (4) legal
separations; (5) annulments of marriage; (6) judgments
declaring marriages void from the beginning; (7)
legitimations; (8) adoptions; (9) acknowledgments of
natural children; (10) naturalization; (11) loss, or (12)
recovery of citizenship; (13) civil interdiction; (14)
judicial determination of filiation; (15) voluntary
emancipation of a minor; and (16) changes of name.
The acts, events or factual errors contemplated under
Article 407 of the Civil Code include even those that
occur after birth.25 However, no reasonable
interpretation of the provision can justify the conclusion
that it covers the correction on the ground of sex
reassignment.
To correct simply means "to make or set aright; to
remove the faults or error from" while to change means
"to replace something with something else of the same
kind or with something that serves as a
substitute."26 The birth certificate of petitioner
contained no error. All entries therein, including those
corresponding to his first name and sex, were all
correct. No correction is necessary.
Article 407 of the Civil Code authorizes the entry in the
civil registry of certain acts (such as legitimations,
acknowledgments of illegitimate children and
naturalization), events (such as births, marriages,
naturalization and deaths) and judicial decrees (such
as legal separations, annulments of marriage,
declarations of nullity of marriages, adoptions,
naturalization, loss or recovery of citizenship, civil
interdiction, judicial determination of filiation and
changes of name). These acts, events and judicial
decrees produce legal consequences that touch upon
the legal capacity, status and nationality of a person.
Their effects are expressly sanctioned by the laws. In
contrast, sex reassignment is not among those acts or
events mentioned in Article 407. Neither is it
recognized nor even mentioned by any law, expressly
or impliedly.
"Status" refers to the circumstances affecting the legal
situation (that is, the sum total of capacities and
incapacities) of a person in view of his age, nationality
and his family membership.27
The status of a person in law includes all his personal
qualities and relations, more or less permanent in
nature, not ordinarily terminable at his own will,
such as his being legitimate or illegitimate, or his being
married or not. The comprehensive term status…
include such matters as the beginning and end of legal
personality, capacity to have rights in general, family
relations, and its various aspects, such as birth,
legitimation, adoption, emancipation, marriage,
divorce, and sometimes even succession.28 (emphasis
supplied)
A person’s sex is an essential factor in marriage and
family relations. It is a part of a person’s legal capacity
and civil status. In this connection, Article 413 of the
Civil Code provides:
ART. 413. All other matters pertaining to the
registration of civil status shall be governed by special
laws.
But there is no such special law in the Philippines
governing sex reassignment and its effects. This is
fatal to petitioner’s cause.
Moreover, Section 5 of Act 3753 (the Civil Register
Law) provides:
SEC. 5. Registration and certification of births. – The
declaration of the physician or midwife in attendance at
the birth or, in default thereof, the declaration of either
parent of the newborn child, shall be sufficient for the
registration of a birth in the civil register. Such
declaration shall be exempt from documentary stamp
tax and shall be sent to the local civil registrar not later
than thirty days after the birth, by the physician or
midwife in attendance at the birth or by either parent of
the newborn child.
In such declaration, the person above mentioned shall
certify to the following facts: (a) date and hour of birth;
(b) sex and nationality of infant; (c) names, citizenship
and religion of parents or, in case the father is not
known, of the mother alone; (d) civil status of parents;
(e) place where the infant was born; and (f) such other
data as may be required in the regulations to be issued.
41
xxx xxx xxx (emphasis supplied)
Under the Civil Register Law, a birth certificate is a
historical record of the facts as they existed at the time
of birth.29 Thus, the sex of a person is determined at
birth, visually done by the birth attendant (the physician
or midwife) by examining the genitals of the infant.
Considering that there is no law legally recognizing sex
reassignment, the determination of a person’s sex
made at the time of his or her birth, if not attended by
error,30is immutable.31
When words are not defined in a statute they are to be
given their common and ordinary meaning in the
absence of a contrary legislative intent. The words
"sex," "male" and "female" as used in the Civil Register
Law and laws concerning the civil registry (and even all
other laws) should therefore be understood in their
common and ordinary usage, there being no legislative
intent to the contrary. In this connection, sex is defined
as "the sum of peculiarities of structure and function
that distinguish a male from a female"32 or "the
distinction between male and female."33 Female is "the
sex that produces ova or bears young"34 and male is
"the sex that has organs to produce spermatozoa for
fertilizing ova."35 Thus, the words "male" and "female"
in everyday understanding do not include persons who
have undergone sex reassignment. Furthermore,
"words that are employed in a statute which had at the
time a well-known meaning are presumed to have
been used in that sense unless the context compels to
the contrary."36 Since the statutory language of the
Civil Register Law was enacted in the early 1900s and
remains unchanged, it cannot be argued that the term
"sex" as used then is something alterable through
surgery or something that allows a post-operative
male-to-female transsexual to be included in the
category "female."
For these reasons, while petitioner may have
succeeded in altering his body and appearance
through the intervention of modern surgery, no law
authorizes the change of entry as to sex in the civil
registry for that reason. Thus, there is no legal basis for
his petition for the correction or change of the entries
in his birth certificate.
Neither May Entries in the Birth Certificate As to
First Name or Sex Be Changed on the Ground of
Equity
The trial court opined that its grant of the petition was
in consonance with the principles of justice and equity.
It believed that allowing the petition would cause no
harm, injury or prejudice to anyone. This is wrong.
The changes sought by petitioner will have serious and
wide-ranging legal and public policy consequences.
First, even the trial court itself found that the petition
was but petitioner’s first step towards his eventual
marriage to his male fiancé. However, marriage, one of
the most sacred social institutions, is a special contract
of permanent union between a man and a
woman.37 One of its essential requisites is the legal
capacity of the contracting parties who must be a male
and a female.38 To grant the changes sought by
petitioner will substantially reconfigure and greatly alter
the laws on marriage and family relations. It will allow
the union of a man with another man who has
undergone sex reassignment (a male-to-female post-
operative transsexual). Second, there are various laws
which apply particularly to women such as the
provisions of the Labor Code on employment of
women,39 certain felonies under the Revised Penal
Code40 and the presumption of survivorship in case of
calamities under Rule 131 of the Rules of
Court,41 among others. These laws underscore the
public policy in relation to women which could be
substantially affected if petitioner’s petition were to be
granted.
It is true that Article 9 of the Civil Code mandates that
"[n]o judge or court shall decline to render judgment by
reason of the silence, obscurity or insufficiency of the
law." However, it is not a license for courts to engage
in judicial legislation. The duty of the courts is to apply
or interpret the law, not to make or amend it.
In our system of government, it is for the legislature,
should it choose to do so, to determine what guidelines
should govern the recognition of the effects of sex
reassignment. The need for legislative guidelines
becomes particularly important in this case where the
claims asserted are statute-based.
To reiterate, the statutes define who may file petitions
for change of first name and for correction or change
of entries in the civil registry, where they may be filed,
what grounds may be invoked, what proof must be
presented and what procedures shall be observed. If
the legislature intends to confer on a person who has
undergone sex reassignment the privilege to change
his name and sex to conform with his reassigned sex,
it has to enact legislation laying down the guidelines in
turn governing the conferment of that privilege.
It might be theoretically possible for this Court to write
a protocol on when a person may be recognized as
having successfully changed his sex. However, this
Court has no authority to fashion a law on that matter,
or on anything else. The Court cannot enact a law
where no law exists. It can only apply or interpret the
written word of its co-equal branch of government,
Congress.
Petitioner pleads that "[t]he unfortunates are also
entitled to a life of happiness, contentment and [the]
realization of their dreams." No argument about that.
The Court recognizes that there are people whose
preferences and orientation do not fit neatly into the
commonly recognized parameters of social convention
and that, at least for them, life is indeed an ordeal.
However, the remedies petitioner seeks involve
questions of public policy to be addressed solely by the
legislature, not by the courts.
WHEREFORE, the petition is hereby DENIED.
Costs against petitioner.
SO ORDERED.
Puno, C.J., Chairperson, Sandoval-Gutierrez, Azcuna,
Garcia, JJ., concur.
Footnotes
1
Petitioner went for his elementary and high school, as
well as his Bachelor of Science in Statistics and Master
of Arts, in the University of the Philippines. He took up
Population Studies Program, Master of Arts in
Sociology and Doctor of Philosophy in Sociology at the
University of Hawaii, in Manoa, Hawaii, U.S.A. Rollo, p.
48.
2
This consisted of "penectomy [surgical removal of
penis] bilateral oschiectomy [or orchiectomy which is
the surgical excision of the testes] penile skin inversion
vaginoplasty [plastic surgery of the vagina] clitoral
42

hood reconstruction and augmentation mammoplasty
[surgical enhancement of the size and shape of the
breasts]." Id.
3On January 23, 2003, January 30, 2003 and February
6, 2003.
4Penned by Judge Felixberto T. Olalia, Jr. Rollo, pp.
51-53.
5 Id., pp. 52-53 (citations omitted).
6 such party, in terms of transportation expenses, time
Docketed as CA-G.R. SP No. 78824.
7 Special Sixth Division.
8Penned by Associate Justice Arcangelita M. Romilla-
Lontok with Associate Justices Marina L. Buzon and
Aurora Santiago-Lagman concurring. Rollo, pp. 25-33.
9 Resolution dated September 14, 2006, id., pp. 45-46.
10 An Act Authorizing the City or Municipal Civil
Registrar or the Consul General to Correct a Clerical or
Typographical Error in an Entry and/or Change of First
Name or Nickname in the Civil Register Without Need
of a Judicial Order, Amending for the Purpose Articles
376 and 412 of the Civil Code of the Philippines.
11
Wang v. Cebu City Civil Registrar, G.R. No. 159966,
30 March 2005, 454 SCRA 155.
12
Id.
13
K v. Health Division, Department of Human
Resources, 277 Or. 371, 560 P.2d 1070 (1977).
14
Under Section 2 (6) of RA 9048, "first name" refers
to a name or nickname given to a person which may
consist of one or more names in addition to the middle
names and last names. Thus, the term "first name" will
be used here to refer both to first name and nickname.
15 The last paragraph of Section 7 of RA 9048 provides:
SECTION 7. Duties and Powers of the Civil Registrar
General. – xxx xxx xxx
Where the petition is denied by the city or municipal
civil registrar or the consul general, the petitioner may
either appeal the decision to the civil registrar general
or file the appropriate petition with the proper court.
16
SECTION 3. Who May File the Petition and
Where. – Any person having direct and personal
interest in the correction of a clerical or typographical
error in an entry and/or change of first name or
nickname in the civil register may file, in person, a
verified petition with the local civil registry office of the
city or municipality where the record being sought to be
corrected or changed is kept.
In case the petitioner has already migrated to another
place in the country and it would not be practical for
and effort to appear in person before the local civil
registrar keeping the documents to be corrected or
changed, the petition may be filed, in person, with the
local civil registrar of the place where the interested
party is presently residing or domiciled. The two (2)
local civil registrars concerned will then communicate
to facilitate the processing of the petition.
Citizens of the Philippines who are presently residing
or domiciled in foreign countries may file their petition,
in person, with the nearest Philippine Consulates.
The petitions filed with the city or municipal civil
registrar or the consul general shall be processed in
accordance with this Act and its implementing rules
and regulations.
All petitions for the clerical or typographical errors
and/or change of first names or nicknames may be
availed of only once.
17 SECTION 5. Form and Contents of the Petition. –
The petition shall be in the form of an affidavit,
subscribed and sworn to before any person authorized
by the law to administer oaths. The affidavit shall set
forth facts necessary to establish the merits of the
petition and shall show affirmatively that the petitioner
is competent to testify to the matters stated. The
petitioner shall state the particular erroneous entry or
entries, which are sought to be corrected and/or the
change sought to be made.
The petition shall be supported with the following
documents:
(1) A certified true machine copy of the certificate or of
the page of the registry book containing the entry or
entries sought to be corrected or changed;
(2) At least two (2) public or private documents showing
the correct entry or entries upon which the correction
or change shall be based; and
(3) Other documents which the petitioner or the city or
municipal civil registrar or the consul general may
consider relevant and necessary for the approval of the
petition.
In case of change of first name or nickname, the
petition shall likewise be supported with the documents
mentioned in the immediately preceding paragraph. In
addition, the petition shall be published at least once a
week for two (2) consecutive weeks in a newspaper of
general circulation. Furthermore, the petitioner shall
submit a certification from the appropriate law
enforcement agencies that he has no pending case or
no criminal record.
18
Republic v. Court of Appeals, G.R. No. 97906, 21
May 1992, 209 SCRA 189.
19
Supra note 11.
20
Id.
21In re Ladrach, 32 Ohio Misc.2d 6, 513 N.E.2d 828
(1987).
22 Lee v. Court of Appeals, 419 Phil. 392 (2001).
23 Id.
24
Co v. Civil Register of Manila, G.R. No. 138496, 23
February 2004, 423 SCRA 420.
25
Id.
26
Id.
27Beduya v. Republic of the Philippines, 120 Phil. 114
(1964).
28Salonga, Jovito, Private International Law, 1995
Edition, Rex Bookstore, p. 238.
29This, of course, should be taken in conjunction with
Articles 407 and 412 of the Civil Code which authorizes
the recording of acts, events and judicial decrees or the
correction or change of errors including those that
occur after birth. Nonetheless, in such cases, the
entries in the certificates of birth are not be corrected
43
or changed. The decision of the court granting the
petition shall be annotated in the certificates of birth
and shall form part of the civil register in the Office of
the Local Civil Registrar. (Co v. Civil Register of
Manila, supra note 24)
30The error pertains to one where the birth attendant
writes "male" or "female" but the genitals of the child
are that of the opposite sex.
31Moreover, petitioner’s female anatomy is all man-
made. The body that he inhabits is a male body in all
aspects other than what the physicians have supplied.
32 Black’s Law Dictionary, 8th edition (2004), p.1406.
33 Words and Phrases, volume 39, Permanent Edition,
p. 106.
34In re Application for Marriage License for Nash,
2003-Ohio-7221 (No. 2002-T-0149, slip op., Not
Reported in N.E.2d, 2003 WL 23097095 (Ohio App. 11
Dist., December 31, 2003), citing Webster’s II New
College Dictionary (1999).
35 Id.
36Standard Oil Co. v. United States, 221 U.S. 1 (1911),
31 S.Ct. 502, 55 L.Ed. 619.
37 Article 1, Family Code.
38 Article 2(1), Id.
39These are Articles 130 to 138 of the Labor Code
which include nightwork prohibition, facilities for
women, prohibition on discrimination and stipulation
against marriage, among others.
40 These include Article 333 on adultery, Articles 337 to
339 on qualified seduction, simple seduction and acts
of lasciviousness with the consent of the offended party
and Articles 342 and 343 on forcible and consented
abduction, among others.
41 Section 3(jj)(4).

44
 Before the Court is a petition for review on certiorari
under Rule 45 of the Rules of Court seeking to reverse
and set aside the Orders1 dated February 19, 2010 and
September 1, 2010, respectively, of the Regional Trial
Court of Cebu City (RTC-Cebu), which dismissed the
criminal case entitled People of the Philippines v. Ernst
Johan Brinkman Van Wilsem, docketed as Criminal
Case No. CBU-85503, for violation of Republic Act
(R.A.) No. 9262, otherwise known as the Anti-Violence
Against Women and Their Children Act of 2004.
The following facts are culled from the records:
Petitioner Norma A. Del Socorro and respondent Ernst
Johan Brinkman Van Wilsem contracted marriage in
Holland on September 25, 1990.2 On January 19,
1994, they were blessed with a son named Roderigo
Norjo Van Wilsem, who at the time of the filing of the
instant petition was sixteen (16) years of age.3
Unfortunately, their marriage bond ended on July 19,
1995 by virtue of a Divorce Decree issued by the
appropriate Court of Holland.4 At that time, their son
was only eighteen (18) months old.5 Thereafter,
petitioner and her son came home to the Philippines.6
According to petitioner, respondentmade a promise to
provide monthly support to their son in the amount of
Two Hundred Fifty (250) Guildene (which is equivalent
to Php17,500.00 more or less).7 However, since the
arrival of petitioner and her son in the Philippines,
respondent never gave support to the son, Roderigo. 8
Republic of the Philippines
SUPREME COURT Not long thereafter, respondent cameto the Philippines
Manila and remarried in Pinamungahan, Cebu, and since
then, have been residing thereat.9 Respondent and his
THIRD DIVISION new wife established a business known as Paree
Catering, located at Barangay Tajao, Municipality of
G.R. No. 193707 December 10, 2014 Pinamungahan, Cebu City.10 To date, all the parties,
including their son, Roderigo, are presently living in
NORMA A. DEL SOCORRO, for and in behalf of
Cebu City.11
her minor child RODERIGO NORJO VAN
WILSEM,Petitioner, On August 28, 2009, petitioner, through her counsel,
vs. sent a letter demanding for support from respondent.
ERNST JOHAN BRINKMAN VAN However, respondent refused to receive the letter.12
WILSEM, Respondent.
Because of the foregoing circumstances, petitioner
DECISION filed a complaint affidavit with the Provincial Prosecutor
of Cebu City against respondent for violation of Section
PERALTA, J.:
5, paragraph E(2) of R.A. No. 9262 for the latter’s
unjust refusal to support his minor child with
petitioner.13 Respondent submitted his counter-
affidavit thereto, to which petitioner also submitted her
reply-affidavit.14 Thereafter, the Provincial Prosecutor
of Cebu City issued a Resolution recommending the
filing of an information for the crime charged against
herein respondent.
The information, which was filed with the RTC-Cebu
and raffled to Branch 20 thereof, states that:
That sometime in the year 1995 and up to the present,
more or less, in the Municipality of Minglanilla,
Province of Cebu, Philippines, and within the
jurisdiction of this Honorable Court, the above-named
accused, did then and there wilfully, unlawfully and
deliberately deprive, refuse and still continue to deprive
his son RODERIGO NORJO VAN WILSEM, a fourteen
(14) year old minor, of financial support legally due him,
resulting in economic abuse to the victim. CONTRARY
TO LAW.15
Upon motion and after notice and hearing, the RTC-
Cebu issued a Hold Departure Order against
respondent.16Consequently, respondent was arrested
and, subsequently, posted bail.17 Petitioner also filed a
Motion/Application of Permanent Protection Order to
which respondent filed his Opposition.18 Pending the
resolution thereof, respondent was
arraigned.19 Subsequently, without the RTC-Cebu
having resolved the application of the protection order,
respondent filed a Motion to Dismiss on the ground of:
(1) lack of jurisdiction over the offense charged; and (2)
prescription of the crime charged.20
On February 19, 2010, the RTC-Cebu issued the
herein assailed Order,21 dismissing the instant criminal
case against respondent on the ground that the facts
charged in the information do not constitute an offense
with respect to the respondent who is analien, the
dispositive part of which states:
WHEREFORE, the Court finds that the facts charged
in the information do not constitute an offense with
respect to the accused, he being an alien, and
accordingly, orders this case DISMISSED.
The bail bond posted by accused Ernst Johan
Brinkman Van Wilsem for his provisional liberty
ishereby cancelled (sic) and ordered released.
SO ORDERED.
45
Cebu City, Philippines, February 19, 2010.22
Thereafter, petitioner filed her Motion for
Reconsideration thereto reiterating respondent’s
obligation to support their child under Article 19523 of
the Family Code, thus, failure todo so makes him liable
under R.A. No. 9262 which "equally applies to all
persons in the Philippines who are obliged to support
their minor children regardless of the obligor’s
nationality."24
On September 1, 2010, the lower court issued an
Order25 denying petitioner’s Motion for
Reconsideration and reiterating its previous ruling.
Thus:
x x x The arguments therein presented are basically a
rehash of those advanced earlier in the memorandum
of the prosecution. Thus, the court hereby reiterates its
ruling that since the accused is a foreign national he is
not subject to our national law (The Family Code) in
regard to a parent’s duty and obligation to givesupport
to his child. Consequently, he cannot be charged of
violating R.A. 9262 for his alleged failure to support his
child. Unless it is conclusively established that R.A.
9262 applies to a foreigner who fails to give support
tohis child, notwithstanding that he is not bound by our
domestic law which mandates a parent to give such
support, it is the considered opinion of the court that no
prima faciecase exists against the accused herein,
hence, the case should be dismissed.
WHEREFORE, the motion for reconsideration is
hereby DENIED for lack of merit.
SO ORDERED.
Cebu City, Philippines, September 1, 2010.26
Hence, the present Petition for Review on Certiorari
raising the following issues:
1. Whether or not a foreign national has an obligation
to support his minor child under Philippine law; and
2. Whether or not a foreign national can be held
criminally liable under R.A. No. 9262 for his unjustified
failure to support his minor child.27
At the outset, let it be emphasized that We are taking
cognizance of the instant petition despite the fact that
the same was directly lodged with the Supreme Court,
consistent with the ruling in Republic v. Sunvar Realty
Development Corporation,28 which lays down the
instances when a ruling of the trial court may be
brought on appeal directly to the Supreme Court
without violating the doctrine of hierarchy of courts, to
wit:
x x x Nevertheless, the Rules do not prohibit any of the
parties from filing a Rule 45 Petition with this Court, in
case only questions of law are raised or involved. This
latter situation was one that petitioners found
themselves in when they filed the instant Petition to
raise only questions of law. In Republic v. Malabanan,
the Court clarified the three modes of appeal from
decisions of the RTC, to wit: (1) by ordinary appeal or
appeal by writ of error under Rule 41, whereby
judgment was rendered in a civil or criminal action by
the RTC in the exercise of its original jurisdiction; (2) by
a petition for review under Rule 42, whereby judgment
was rendered by the RTC in the exercise of its
appellate jurisdiction; and (3) by a petition for review on
certiorari before the Supreme Court under Rule 45.
"The first mode of appeal is taken to the [Court of
Appeals] on questions of fact or mixed questions of fact
and law. The second mode of appeal is brought to the
CA on questions of fact, of law, or mixed questions of
fact and law. The third mode of appealis elevated to the
Supreme Court only on questions of law." (Emphasis
supplied)
There is a question of law when the issue does not call
for an examination of the probative value of the
evidence presented or of the truth or falsehood of the
facts being admitted, and the doubt concerns the
correct application of law and jurisprudence on the
matter. The resolution of the issue must rest solely on
what the law provides on the given set of
circumstances.29
Indeed, the issues submitted to us for resolution
involve questions of law – the response thereto
concerns the correct application of law and
jurisprudence on a given set of facts, i.e.,whether or not
a foreign national has an obligation to support his minor
child under Philippine law; and whether or not he can
be held criminally liable under R.A. No. 9262 for his
unjustified failure to do so.
It cannot be negated, moreover, that the instant petition
highlights a novel question of law concerning the
liability of a foreign national who allegedly commits acts
and omissions punishable under special criminal laws,
specifically in relation to family rights and duties. The
inimitability of the factual milieu of the present case,
therefore, deserves a definitive ruling by this Court,
which will eventually serve as a guidepost for future
cases. Furthermore, dismissing the instant petition and
remanding the same to the CA would only waste the
time, effort and resources of the courts. Thus, in the
present case, considerations of efficiency and
economy in the administration of justice should prevail
over the observance of the hierarchy of courts.
Now, on the matter of the substantive issues, We find
the petition meritorious. Nonetheless, we do not fully
agree with petitioner’s contentions.
To determine whether or not a person is criminally
liable under R.A. No. 9262, it is imperative that the legal
obligation to support exists.
Petitioner invokes Article 19530 of the Family Code,
which provides the parent’s obligation to support his
child. Petitioner contends that notwithstanding the
existence of a divorce decree issued in relation to
Article 26 of the Family Code,31 respondent is not
excused from complying with his obligation to support
his minor child with petitioner.
On the other hand, respondent contends that there is
no sufficient and clear basis presented by petitioner
that she, as well as her minor son, are entitled to
financial support.32 Respondent also added that by
reason of the Divorce Decree, he is not obligated
topetitioner for any financial support.33
On this point, we agree with respondent that petitioner
cannot rely on Article 19534 of the New Civil Code in
demanding support from respondent, who is a foreign
citizen, since Article 1535 of the New Civil Code
stresses the principle of nationality. In other words,
insofar as Philippine laws are concerned, specifically
the provisions of the Family Code on support, the same
only applies to Filipino citizens. By analogy, the same
principle applies to foreigners such that they are
governed by their national law with respect to family
rights and duties.36
46
The obligation to give support to a child is a matter that
falls under family rights and duties. Since the
respondent is a citizen of Holland or the Netherlands,
we agree with the RTC-Cebu that he is subject to the
laws of his country, not to Philippinelaw, as to whether
he is obliged to give support to his child, as well as the
consequences of his failure to do so.37
In the case of Vivo v. Cloribel,38 the Court held that –
Furthermore, being still aliens, they are not in position
to invoke the provisions of the Civil Code of the
Philippines, for that Code cleaves to the principle that
family rights and duties are governed by their personal
law, i.e.,the laws of the nation to which they belong
even when staying in a foreign country (cf. Civil Code,
Article 15).39
It cannot be gainsaid, therefore, that the respondent is
not obliged to support petitioner’s son under Article195
of the Family Code as a consequence of the Divorce
Covenant obtained in Holland. This does not, however,
mean that respondent is not obliged to support
petitioner’s son altogether.
In international law, the party who wants to have a
foreign law applied to a dispute or case has the burden
of proving the foreign law.40 In the present case,
respondent hastily concludes that being a national of
the Netherlands, he is governed by such laws on the
matter of provision of and capacity to support. 41 While
respondent pleaded the laws of the Netherlands in
advancing his position that he is not obliged to support
his son, he never proved the same.
It is incumbent upon respondent to plead and prove
that the national law of the Netherlands does not
impose upon the parents the obligation to support their
child (either before, during or after the issuance of a
divorce decree), because Llorente v. Court of
Appeals,42 has already enunciated that:
True, foreign laws do not prove themselves in our
jurisdiction and our courts are not authorized to
takejudicial notice of them. Like any other fact, they
must be alleged and proved.43
In view of respondent’s failure to prove the national law
of the Netherlands in his favor, the doctrine of
processual presumption shall govern. Under this
doctrine, if the foreign law involved is not properly
pleaded and proved, our courts will presume that the
foreign law is the same as our local or domestic or
internal law.44 Thus, since the law of the Netherlands
as regards the obligation to support has not been
properly pleaded and proved in the instant case, it is
presumed to be the same with Philippine law, which
enforces the obligation of parents to support their
children and penalizing the non-compliance therewith.
Moreover, while in Pilapil v. Ibay-Somera,45 the Court
held that a divorce obtained in a foreign land as well as
its legal effects may be recognized in the Philippines in
view of the nationality principle on the matter of status
of persons, the Divorce Covenant presented by
respondent does not completely show that he is
notliable to give support to his son after the divorce
decree was issued. Emphasis is placed on petitioner’s
allegation that under the second page of the aforesaid
covenant, respondent’s obligation to support his child
is specifically stated,46which was not disputed by
respondent.
We likewise agree with petitioner that notwithstanding
that the national law of respondent states that parents
have no obligation to support their children or that such
obligation is not punishable by law, said law would still
not find applicability,in light of the ruling in Bank of
America, NT and SA v. American Realty
Corporation,47 to wit:
In the instant case, assuming arguendo that the
English Law on the matter were properly pleaded and
proved in accordance with Section 24, Rule 132 of the
Rules of Court and the jurisprudence laid down in Yao
Kee, et al. vs. Sy-Gonzales, said foreign law would still
not find applicability.
Thus, when the foreign law, judgment or contract is
contrary to a sound and established public policy of the
forum, the said foreign law, judgment or order shall not
be applied.
Additionally, prohibitive laws concerning persons, their
acts or property, and those which have for their object
public order, public policy and good customs shall not
be rendered ineffective by laws or judgments
promulgated, or by determinations or conventions
agreed upon in a foreign country.
The public policy sought to be protected in the instant
case is the principle imbedded in our jurisdiction
proscribing the splitting up of a single cause of action.
Section 4, Rule 2 of the 1997 Rules of Civil Procedure
is pertinent
—
If two or more suits are instituted on the basis of the
same cause of action, the filing of one or a judgment
upon the merits in any one is available as a ground for
the dismissal of the others. Moreover, foreign law
should not be applied when its application would work
undeniable injustice to the citizens or residents of the
forum. To give justice is the most important function of
law; hence, a law, or judgment or contract that is
obviously unjust negates the fundamental principles of
Conflict of Laws.48
Applying the foregoing, even if the laws of the
Netherlands neither enforce a parent’s obligation to
support his child nor penalize the noncompliance
therewith, such obligation is still duly enforceable in the
Philippines because it would be of great injustice to the
child to be denied of financial support when the latter is
entitled thereto.
We emphasize, however, that as to petitioner herself,
respondent is no longer liable to support his former
wife, in consonance with the ruling in San Luis v. San
Luis,49 to wit:
As to the effect of the divorce on the Filipino wife, the
Court ruled that she should no longerbe considered
marriedto the alien spouse. Further, she should not be
required to perform her marital duties and obligations.
It held:
To maintain, as private respondent does, that, under
our laws, petitioner has to be considered still married
to private respondent and still subject to a wife's
obligations under Article 109, et. seq. of the Civil Code
cannot be just. Petitioner should not be obliged to live
together with, observe respect and fidelity, and render
support to private respondent. The latter should not
continue to be one of her heirs with possible rights to
conjugal property. She should not be discriminated
against in her own country if the ends of justice are to
be served. (Emphasis added)50
47
Based on the foregoing legal precepts, we find that
respondent may be made liable under Section 5(e) and
(i) of R.A. No. 9262 for unjustly refusing or failing to
give support topetitioner’s son, to wit:
SECTION 5. Acts of Violence Against Women and
Their Children.- The crime of violence against women
and their children is committed through any of the
following acts:
xxxx
(e) Attempting to compel or compelling the woman or
her child to engage in conduct which the woman or her
child has the right to desist from or desist from conduct
which the woman or her child has the right to engage
in, or attempting to restrict or restricting the woman's or
her child's freedom of movement or conduct by force
or threat of force, physical or other harm or threat of
physical or other harm, or intimidation directed against
the woman or child. This shall include, butnot limited
to, the following acts committed with the purpose or
effect of controlling or restricting the woman's or her
child's movement or conduct:
xxxx
(2) Depriving or threatening to deprive the woman or
her children of financial support legally due her or her
family, or deliberately providing the woman's children
insufficient financial support; x x x x
(i) Causing mental or emotional anguish, public ridicule
or humiliation to the woman or her child, including, but
not limited to, repeated verbal and emotional abuse,
and denial of financial support or custody of minor
childrenof access to the woman's child/children.51
Under the aforesaid special law, the deprivation or
denial of financial support to the child is considered
anact of violence against women and children.
In addition, considering that respondent is currently
living in the Philippines, we find strength in petitioner’s
claim that the Territoriality Principle in criminal law, in
relation to Article 14 of the New Civil Code, applies to
the instant case, which provides that: "[p]enal laws and
those of public security and safety shall be obligatory
upon all who live and sojourn in Philippine territory,
subject to the principle of public international law and
to treaty stipulations." On this score, it is indisputable
that the alleged continuing acts of respondent in PRESBITERO J. VELASCO, JR.
refusing to support his child with petitioner is committed Associate Justice
here in the Philippines as all of the parties herein are Chairperson
residents of the Province of Cebu City. As such, our
courts have territorial jurisdiction over the offense MARTIN S. JOSE CATRAL
charged against respondent. It is likewise irrefutable VILLARAMA, JR. MENDOZA*
that jurisdiction over the respondent was acquired Associate Justice Associate Justice
upon his arrest.
BIENVENIDO L. REYES
Finally, we do not agree with respondent’s argument Associate Justice
that granting, but not admitting, that there is a legal
basis for charging violation of R.A. No. 9262 in the ATTESTATION
instant case, the criminal liability has been
I attest that the conclusions in the above Decision had
extinguished on the ground of prescription of
been reached in consultation before the case was
crime52 under Section 24 of R.A. No. 9262, which
assigned to the writer of the opinion of the Court's
provides that:
Division.
SECTION 24. Prescriptive Period. – Acts falling under
PRESBITERO J. VELASCO, JR.
Sections 5(a) to 5(f) shall prescribe in twenty (20)
Associate Justice
years. Acts falling under Sections 5(g) to 5(I) shall
Chairperson, Third Division
prescribe in ten (10) years.
CERTIFICATION
The act of denying support to a child under Section
5(e)(2) and (i) of R.A. No. 9262 is a continuing Pursuant to Section 13, Article VIII of the Constitution
offense,53which started in 1995 but is still ongoing at and the Division Chairperson's Attestation, I certify
present. Accordingly, the crime charged in the instant that the conclusions in the above Decision had been
case has clearly not prescribed. reached in consultation before the case was assigned
to the writer of the opinion of the Court's Division.
Given, however, that the issue on whether respondent
has provided support to petitioner’s child calls for an MARIA LOURDES P.A. SERENO
examination of the probative value of the evidence Chief Justice
presented, and the truth and falsehood of facts being
admitted, we hereby remand the determination of this
issue to the RTC-Cebu which has jurisdiction over the
case.
Footnotes
WHEREFORE, the petition is GRANTED. The Orders
dated February 19, 2010 and September 1, 2010, * Designated Acting Member in lieu of Associate
Justice Francis H. Jardeleza, per Special Order No.
respectively, of the Regional Trial Court of the City of
1896 dated November 28, 2014
Cebu are hereby REVERSED and SET ASIDE. The
case is REMANDED to the same court to conduct 1
further proceedings based on the merits of the case. Penned by Judge Bienvenido R. Saniel, Jr.; Annexes
"A" and "B" to Petition, respectively, rollo, pp. 22-26.
SO ORDERED. 2
Rollo, p. 6.
DIOSDADO M. PERALTA 3
Id.
Associate Justice
4 Id. at 7.
WE CONCUR:
5 Annex "F" to Petition, rollo, p. 31.
48
6 26 44
Id. at 32. Id. Bank of America, NT and SA v. American Realty
Corporation, 378 Phil. 1279, 1296 (1999).
7 27
Annex "A" to Petition, rollo, pp. 23-24. Rollo, p. 10.
45 G.R. No. 80116, June 30, 1989, 174 SCRA 653.
8 28
Id. at 24. G.R. No. 194880, June 20, 2012, 674 SCRA 320.
46 Rollo, p. 18.
9 29
Id.at 32. Id.at 332-333.
47 Supra note 44.
10 30
Id. Supra note 23.
48 Id.at 1296-1297. (Emphasis supplied)
11 31
Supra note 7, at 23-24. Art. 26. All marriages solemnized outside the
49
Philippines, in accordance with the laws in force in the 543 Phil. 275 (2007).
12 Supra note 5, at 32. country where they were solemnized, and valid there
50
assuch, shall also be valid in this country, except those Id.at 290.
13 Rollo, p. 7.
prohibited under Articles 35 (1), (4), (5) and (6), 3637 51Section 5(e) and (i) of R.A. No. 9262. (Emphasis
14 Id. and 38.
supplied)
15 Id. at 22. Where a marriage between a Filipino citizen and a 52 Rollo, p. 15.
foreigner is validly celebrated and a divorce is
16 thereafter validly obtained abroad by the alien spouse
Id. 53In People v. De Leon, 608 Phil. 701, 722 (2009), it
capacitating him or her to remarry, the Filipino spouse was held that:
17 Id. at 24. shall have capacity to remarry under Philippine law.
18
(As amended by Executive Order 227) A continued (continuous or continuing) crime is defined
Id. at 8.
32
as a single crime, consisting of a series of acts but all
19
Comment on the Petition for Review on Certiorari, arising from one criminal resolution. Although there is
Id. rollo, p. 123. a series of acts, there is only one crime committed;
20 Id. 33 hence, only one penalty shall be imposed.
Id. at 122.
21 Supra note 7. 34 Supra note 23.
22 Id.at 24. 35 Art. 15. Laws relating to family rights and duties, or
23
Art. 195. Subject to the provisions of the succeeding to the status, condition and legal capacity of persons
articles, the following are obliged to support each other are binding upon citizens of the Philippines, even
to the whole extent set forth in the preceding article: though living abroad.
36
(1) The spouses; Supra note 7, at 24.
37
(2) Legitimate ascendants and descendants; Id.
38
(3) Parents and their legitimate children and the G.R. No. L-25441, October 26, 1968, 25 SCRA 616.
legitimate and illegitimate children of the latter; 39 Id. at 625-626. (Emphasis supplied)
(4) Parents and their illegitimate children and the 40EDI-Staff builders International, Inc. v. NLRC, 563
legitimate and illegitimate children of the latter; and Phil. 1, 22 (2007).
(5) Legitimate brothers and sisters, whether of full or 41 Annex "N" to Petition, rollo, p. 84.
half-blood.
42
24
399 Phil. 342 (2000).
Annex "R" to Petition, rollo, p. 102.
43
25
Id. at 354. (Emphasis supplied)
Annex "B" to Petition, id. at 25.

49

Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 80116 June 30, 1989
IMELDA MANALAYSAY PILAPIL, petitioner,
vs.
HON. CORONA IBAY-SOMERA, in her capacity as
Presiding Judge of the Regional Trial Court of
Manila, Branch XXVI; HON. LUIS C. VICTOR, in his
capacity as the City Fiscal of Manila; and ERICH
EKKEHARD GEILING, respondents.
REGALADO, J.:
An ill-starred marriage of a Filipina and a foreigner
which ended in a foreign absolute divorce, only to be
followed by a criminal infidelity suit of the latter against
the former, provides Us the opportunity to lay down a
decisional rule on what hitherto appears to be an
unresolved jurisdictional question.
On September 7, 1979, petitioner Imelda Manalaysay
Pilapil, a Filipino citizen, and private respondent Erich
Ekkehard Geiling, a German national, were married
before the Registrar of Births, Marriages and Deaths at
Friedensweiler in the Federal Republic of Germany.
The marriage started auspiciously enough, and the
couple lived together for some time in Malate, Manila
where their only child, Isabella Pilapil Geiling, was born
on April 20, 1980. 1
Thereafter, marital discord set in, with mutual
recriminations between the spouses, followed by a
separation de facto between them.
After about three and a half years of marriage, such
connubial disharmony eventuated in private
respondent initiating a divorce proceeding against
petitioner in Germany before the Schoneberg Local
Court in January, 1983. He claimed that there was
failure of their marriage and that they had been living
apart since April, 1982. 2
Petitioner, on the other hand, filed an action for legal
separation, support and separation of property before
the Regional Trial Court of Manila, Branch XXXII, on
January 23, 1983 where the same is still pending as
Civil Case No. 83-15866. 3
On January 15, 1986, Division 20 of the Schoneberg
Local Court, Federal Republic of Germany,
promulgated a decree of divorce on the ground of
failure of marriage of the spouses. The custody of the
child was granted to petitioner. The records show that
under German law said court was locally and
internationally competent for the divorce proceeding
and that the dissolution of said marriage was legally
founded on and authorized by the applicable law of that
foreign jurisdiction. 4
On June 27, 1986, or more than five months after the
issuance of the divorce decree, private respondent
filed two complaints for adultery before the City Fiscal
of Manila alleging that, while still married to said
respondent, petitioner "had an affair with a certain
William Chia as early as 1982 and with yet another man
named Jesus Chua sometime in 1983". Assistant
Fiscal Jacinto A. de los Reyes, Jr., after the
corresponding investigation, recommended the
dismissal of the cases on the ground of insufficiency of
evidence. 5 However, upon review, the respondent city
fiscal approved a resolution, dated January 8, 1986,
directing the filing of two complaints for adultery
against the petitioner. 6 The complaints were
accordingly filed and were eventually raffled to two
branches of the Regional Trial Court of Manila. The
case entitled "People of the Philippines vs. Imelda
Pilapil and William Chia", docketed as Criminal Case
No. 87-52435, was assigned to Branch XXVI presided
by the respondent judge; while the other case, "People
of the Philippines vs. Imelda Pilapil and James Chua",
docketed as Criminal Case No. 87-52434 went to the
sala of Judge Leonardo Cruz, Branch XXV, of the
same court. 7
On March 14, 1987, petitioner filed a petition with the
Secretary of Justice asking that the aforesaid
resolution of respondent fiscal be set aside and the
cases against her be dismissed. 8 A similar petition
was filed by James Chua, her co-accused in Criminal
Case No. 87-52434. The Secretary of Justice, through
the Chief State Prosecutor, gave due course to both
petitions and directed the respondent city fiscal to
inform the Department of Justice "if the accused have
already been arraigned and if not yet arraigned, to
move to defer further proceedings" and to elevate the
entire records of both cases to his office for review. 9
Petitioner thereafter filed a motion in both criminal
cases to defer her arraignment and to suspend further
proceedings thereon. 10 As a consequence, Judge
Leonardo Cruz suspended proceedings in Criminal
Case No. 87-52434. On the other hand, respondent
judge merely reset the date of the arraignment in
Criminal Case No. 87-52435 to April 6, 1987. Before
such scheduled date, petitioner moved for the
cancellation of the arraignment and for the suspension
of proceedings in said Criminal Case No. 87-52435
until after the resolution of the petition for review then
pending before the Secretary of Justice. 11 A motion to
quash was also filed in the same case on the ground
of lack of jurisdiction, 12 which motion was denied by
the respondent judge in an order dated September 8,
1987. The same order also directed the arraignment of
both accused therein, that is, petitioner and William
Chia. The latter entered a plea of not guilty while the
petitioner refused to be arraigned. Such refusal of the
petitioner being considered by respondent judge as
direct contempt, she and her counsel were fined and
the former was ordered detained until she submitted
50
herself for arraignment. 13 Later, private respondent
entered a plea of not guilty. 14
On October 27, 1987, petitioner filed this special civil
action for certiorari and prohibition, with a prayer for a
temporary restraining order, seeking the annulment of
the order of the lower court denying her motion to
quash. The petition is anchored on the main ground
that the court is without jurisdiction "to try and decide
the charge of adultery, which is a private offense that
cannot be prosecuted de officio (sic), since the
purported complainant, a foreigner, does not qualify as
an offended spouse having obtained a final divorce
decree under his national law prior to his filing the
criminal complaint." 15
On October 21, 1987, this Court issued a temporary
restraining order enjoining the respondents from
implementing the aforesaid order of September 8,
1987 and from further proceeding with Criminal Case
No. 87-52435. Subsequently, on March 23, 1988
Secretary of Justice Sedfrey A. Ordoñez acted on the
aforesaid petitions for review and, upholding
petitioner's ratiocinations, issued a resolution directing
the respondent city fiscal to move for the dismissal of
the complaints against the petitioner. 16
We find this petition meritorious. The writs prayed for
shall accordingly issue.
Under Article 344 of the Revised Penal Code, 17 the
crime of adultery, as well as four other crimes against
chastity, cannot be prosecuted except upon a sworn
written complaint filed by the offended spouse. It has
long since been established, with unwavering
consistency, that compliance with this rule is a
jurisdictional, and not merely a formal,
requirement. 18 While in point of strict law the
jurisdiction of the court over the offense is vested in it
by the Judiciary Law, the requirement for a sworn
written complaint is just as jurisdictional a mandate
since it is that complaint which starts the prosecutory
proceeding 19 and without which the court cannot
exercise its jurisdiction to try the case.
Now, the law specifically provides that in prosecutions
for adultery and concubinage the person who can
legally file the complaint should be the offended
spouse, and nobody else. Unlike the offenses of
seduction, abduction, rape and acts of lasciviousness,
no provision is made for the prosecution of the crimes
of adultery and concubinage by the parents,
grandparents or guardian of the offended party. The
so-called exclusive and successive rule in the
prosecution of the first four offenses above mentioned
do not apply to adultery and concubinage. It is
significant that while the State, as parens patriae, was
added and vested by the 1985 Rules of Criminal
Procedure with the power to initiate the criminal action
for a deceased or incapacitated victim in the aforesaid
offenses of seduction, abduction, rape and acts of
lasciviousness, in default of her parents, grandparents
or guardian, such amendment did not include the
crimes of adultery and concubinage. In other words,
only the offended spouse, and no other, is authorized
by law to initiate the action therefor.
Corollary to such exclusive grant of power to the
offended spouse to institute the action, it necessarily
follows that such initiator must have the status,
capacity or legal representation to do so at the time of
the filing of the criminal action. This is a familiar and
express rule in civil actions; in fact, lack of legal
capacity to sue, as a ground for a motion to dismiss in
civil cases, is determined as of the filing of the
complaint or petition.
The absence of an equivalent explicit rule in the
prosecution of criminal cases does not mean that the
same requirement and rationale would not apply.
Understandably, it may not have been found necessary
since criminal actions are generally and fundamentally
commenced by the State, through the People of the
Philippines, the offended party being merely the
complaining witness therein. However, in the so-called
"private crimes" or those which cannot be
prosecuted de oficio, and the present prosecution for
adultery is of such genre, the offended spouse
assumes a more predominant role since the right to
commence the action, or to refrain therefrom, is a
matter exclusively within his power and option.
This policy was adopted out of consideration for the
aggrieved party who might prefer to suffer the outrage
in silence rather than go through the scandal of a public
trial. 20 Hence, as cogently argued by petitioner, Article
344 of the Revised Penal Code thus presupposes that
the marital relationship is still subsisting at the time of
the institution of the criminal action for, adultery. This is
a logical consequence since the raison d'etre of said
provision of law would be absent where the supposed
offended party had ceased to be the spouse of the
alleged offender at the time of the filing of the criminal
case. 21
In these cases, therefore, it is indispensable that the
status and capacity of the complainant to commence
the action be definitely established and, as already
demonstrated, such status or capacity must indubitably
exist as of the time he initiates the action. It would be
absurd if his capacity to bring the action would be
determined by his status before or subsequent to the
commencement thereof, where such capacity or status
existed prior to but ceased before, or was acquired
subsequent to but did not exist at the time of, the
institution of the case. We would thereby have the
anomalous spectacle of a party bringing suit at the very
time when he is without the legal capacity to do so.
To repeat, there does not appear to be any local
precedential jurisprudence on the specific issue as to
when precisely the status of a complainant as an
offended spouse must exist where a criminal
prosecution can be commenced only by one who in law
can be categorized as possessed of such status.
Stated differently and with reference to the present
case, the inquiry ;would be whether it is necessary in
the commencement of a criminal action for adultery
that the marital bonds between the complainant and
the accused be unsevered and existing at the time of
the institution of the action by the former against the
latter.
American jurisprudence, on cases involving statutes in
that jurisdiction which are in pari materia with ours,
yields the rule that after a divorce has been decreed,
the innocent spouse no longer has the right to institute
proceedings against the offenders where the statute
provides that the innocent spouse shall have the
exclusive right to institute a prosecution for adultery.
Where, however, proceedings have been properly
commenced, a divorce subsequently granted can have
no legal effect on the prosecution of the criminal
proceedings to a conclusion. 22
In the cited Loftus case, the Supreme Court of Iowa
held that —
'No prosecution for adultery can be commenced except
on the complaint of the husband or wife.' Section 4932,
51
Code. Though Loftus was husband of defendant when
the offense is said to have been committed, he had
ceased to be such when the prosecution was begun;
and appellant insists that his status was not such as to
entitle him to make the complaint. We have repeatedly
said that the offense is against the unoffending spouse,
as well as the state, in explaining the reason for this
provision in the statute; and we are of the opinion
that the unoffending spouse must be such when the
prosecution is commenced. (Emphasis supplied.)
We see no reason why the same doctrinal rule should
not apply in this case and in our jurisdiction,
considering our statutory law and jural policy on the
matter. We are convinced that in cases of such nature,
the status of the complainant vis-a-vis the accused
must be determined as of the time the complaint was
filed. Thus, the person who initiates the adultery case
must be an offended spouse, and by this is meant that
he is still married to the accused spouse, at the time of
the filing of the complaint.
In the present case, the fact that private respondent
obtained a valid divorce in his country, the Federal
Republic of Germany, is admitted. Said divorce and its
legal effects may be recognized in the Philippines
insofar as private respondent is concerned 23 in view of
the nationality principle in our civil law on the matter of
status of persons.
Thus, in the recent case of Van Dorn vs. Romillo, Jr.,
et al., 24 after a divorce was granted by a United States
court between Alice Van Dornja Filipina, and her
American husband, the latter filed a civil case in a trial
court here alleging that her business concern was
conjugal property and praying that she be ordered to
render an accounting and that the plaintiff be granted
the right to manage the business. Rejecting his
pretensions, this Court perspicuously demonstrated
the error of such stance, thus:
There can be no question as to the validity of that
Nevada divorce in any of the States of the United
States. The decree is binding on private respondent as
an American citizen. For instance, private respondent
cannot sue petitioner, as her husband, in any State of
the Union. ...
It is true that owing to the nationality principle
embodied in Article 15 of the Civil Code, only Philippine
nationals are covered by the policy against absolute
divorces the same being considered contrary to our
concept of public policy and morality. However, aliens
may obtain divorces abroad, which may be recognized
in the Philippines, provided they are valid according to
their national law. ...
Thus, pursuant to his national law, private respondent
is no longer the husband of petitioner. He would have
no standing to sue in the case below as petitioner's
husband entitled to exercise control over conjugal
assets. ... 25
Under the same considerations and rationale, private
respondent, being no longer the husband of petitioner,
had no legal standing to commence the adultery case
under the imposture that he was the offended spouse
at the time he filed suit.
The allegation of private respondent that he could not
have brought this case before the decree of divorce for
lack of knowledge, even if true, is of no legal
significance or consequence in this case. When said
respondent initiated the divorce proceeding, he
obviously knew that there would no longer be a family
nor marriage vows to protect once a dissolution of the
marriage is decreed. Neither would there be a danger
of introducing spurious heirs into the family, which is
said to be one of the reasons for the particular
formulation of our law on adultery, 26 since there would
thenceforth be no spousal relationship to speak of. The
severance of the marital bond had the effect of
dissociating the former spouses from each other,
hence the actuations of one would not affect or cast
obloquy on the other.
The aforecited case of United States vs. Mata cannot
be successfully relied upon by private respondent. In
applying Article 433 of the old Penal Code,
substantially the same as Article 333 of the Revised
Penal Code, which punished adultery "although the
marriage be afterwards declared void", the Court
merely stated that "the lawmakers intended to declare
adulterous the infidelity of a married woman to her
marital vows, even though it should be made to appear
that she is entitled to have her marriage contract
declared null and void, until and unless she actually
secures a formal judicial declaration to that effect".
Definitely, it cannot be logically inferred therefrom that
the complaint can still be filed after the declaration of
nullity because such declaration that the marriage is
void ab initio is equivalent to stating that it never
existed. There being no marriage from the beginning,
any complaint for adultery filed after said declaration of
nullity would no longer have a leg to stand on.
Moreover, what was consequently contemplated and
within the purview of the decision in said case is the
situation where the criminal action for adultery was
filed before the termination of the marriage by a judicial
declaration of its nullity ab initio. The same rule and
requisite would necessarily apply where the
termination of the marriage was effected, as in this
case, by a valid foreign divorce.
Private respondent's invocation of Donio-Teves, et al.
vs. Vamenta, hereinbefore cited, 27 must suffer the
same fate of inapplicability. A cursory reading of said
case reveals that the offended spouse therein had duly
and seasonably filed a complaint for adultery, although
an issue was raised as to its sufficiency but which was
resolved in favor of the complainant. Said case did not
involve a factual situation akin to the one at bar or any
issue determinative of the controversy herein.
WHEREFORE, the questioned order denying
petitioner's motion to quash is SET ASIDE and another
one enteredDISMISSING the complaint in Criminal
Case No. 87-52435 for lack of jurisdiction. The
temporary restraining order issued in this case on
October 21, 1987 is hereby made permanent.
SO ORDERED.
Melencio-Herrera, Padilla and Sarmiento, JJ., concur.
Separate Opinions
PARAS, J., concurring:
It is my considered opinion that regardless of whether
We consider the German absolute divorce as valid also
in the Philippines, the fact is that the husband in the
instant case, by the very act of his obtaining an
absolute divorce in Germany can no longer be
considered as the offended party in case his former
wife actually has carnal knowledge with another,
because in divorcing her, he already implicitly
authorized the woman to have sexual relations with
others. A contrary ruling would be less than fair for a
52
man, who is free to have sex will be allowed to deprive
the woman of the same privilege.
In the case of Recto v. Harden (100 Phil. 427 [1956]),
the Supreme Court considered the absolute divorce
between the American husband and his American wife
as valid and binding in the Philippines on the theory
that their status and capacity are governed by
their National law, namely, American law. There is no
decision yet of the Supreme Court regarding the
validity of such a divorce if one of the parties, say an
American, is married to a Filipino wife, for then two (2)
different nationalities would be involved.
In the book of Senate President Jovito Salonga entitled
Private International Law and precisely because of
theNational law doctrine, he considers the absolute
divorce as valid insofar as the American husband is
concerned but void insofar as the Filipino wife is
involved. This results in what he calls a "socially
grotesque situation," where a Filipino woman is still
married to a man who is no longer her husband. It is
the opinion however, of the undersigned that very likely
the opposite expresses the correct view. While under
the national law of the husband the absolute divorce
will be valid, still one of the exceptions to the
application of the proper foreign law (one of the
exceptions to comity) is when the foreign law will work
an injustice or injury to the people or residents of the
forum. Consequently since to recognize the absolute
divorce as valid on the part of the husband would be
injurious or prejudicial to the Filipino wife whose
marriage would be still valid under her national law, it
would seem that under our law existing before the new
Family Code (which took effect on August 3, 1988) the
divorce should be considered void both with respect to
the American husband and the Filipino wife.
The recent case of Van Dorn v. Romillo, Jr. (139 SCRA
[1985]) cannot apply despite the fact that the husband
was an American can with a Filipino wife because in
said case the validity of the divorce insofar as the
Filipino wife is concerned was NEVER put in issue.
Separate Opinions
PARAS, J., concurring:
It is my considered opinion that regardless of whether was an American can with a Filipino wife because in
We consider the German absolute divorce as valid also said case the validity of the divorce insofar as the
in the Philippines, the fact is that the husband in the Filipino wife is concerned was NEVER put in issue.
instant case, by the very act of his obtaining an
absolute divorce in Germany can no longer be Footnotes
considered as the offended party in case his former
1 Rollo, 5, 29.
wife actually has carnal knowledge with another,
because in divorcing her, he already implicitly 2 Ibid., 6, 29.
authorized the woman to have sexual relations with
others. A contrary ruling would be less than fair for a 3 Ibid., 7.
man, who is free to have sex will be allowed to deprive
the woman of the same privilege. 4 Ibid., 7, 29-30; Annexes A and A-1, Petition.
In the case of Recto v. Harden (100 Phil. 427 [1956]), 5 Ibid., 7, 178.
the Supreme Court considered the absolute divorce
between the American husband and his American wife 6 Ibid., 8; Annexes B, B-1 and B-2, id.
as valid and binding in the Philippines on the theory
7 Ibid., 8-9, 178.
that their status and capacity are governed by
their National law, namely, American law. There is no 8 Ibid., 9, 178; Annex C, id.
decision yet of the Supreme Court regarding the
validity of such a divorce if one of the parties, say an 9 Ibid., 9-10, 178; Annex D, id.
American, is married to a Filipino wife, for then two (2)
different nationalities would be involved. 10 Ibid., 9; Annexes E and E-1, id.
In the book of Senate President Jovito Salonga entitled 11 Ibid., 10; Annex F, id.
Private International Law and precisely because of
12 Ibid., 9, 179; Annex G, id.
theNational law doctrine, he considers the absolute
divorce as valid insofar as the American husband is 13 Ibid., 10 Annex H, id.
concerned but void insofar as the Filipino wife is
involved. This results in what he calls a "socially 14 Ibid, 105.
grotesque situation," where a Filipino woman is still
married to a man who is no longer her husband. It is 15 Ibid., 11.
the opinion however, of the undersigned that very likely
the opposite expresses the correct view. While under 16 Ibid., 311-313.
the national law of the husband the absolute divorce 17 Cf. Sec. 5, Rule 110, Rules of Court.
will be valid, still one of the exceptions to the
application of the proper foreign law (one of the 18 People vs. Mandia, 60 Phil. 372, 375 (1934); People
exceptions to comity) is when the foreign law will work vs. Zurbano, 37 SCRA 565, 569 (1971); People vs.
an injustice or injury to the people or residents of the Lingayen, G.R. No. 64556, June 10, 1988.
forum. Consequently since to recognize the absolute
divorce as valid on the part of the husband would be 19 Valdepeñas vs. People, 16 SCRA 871 (1966);
injurious or prejudicial to the Filipino wife whose People vs. Babasa, 97 SCRA 672 (1980).
marriage would be still valid under her national law, it
would seem that under our law existing before the new 20 Samilin vs. Court of First Instance of Pangasinan,
Family Code (which took effect on August 3, 1988) the 57 Phil. 298 (1932); Donio-Teves, et al. vs. Vamenta,
divorce should be considered void both with respect to et al., 133 SCRA 616 (1984).
the American husband and the Filipino wife.
21 Rollo, 289.
The recent case of Van Dorn v. Romillo, Jr. (139 SCRA
[1985]) cannot apply despite the fact that the husband
53
22 2 Am. Jur. 2d., 973 citing State vs. Loftus, 104 NW
906, 907; Re Smith, 2 Okla. 153, 37 p. 1099; State vs.
Russell, 90 Iowa 569, 58 NW 915.

23 Recto vs. Harden, 100 Phil. 427 (1956).

24 139 SCRA 139,140 (1985).

25 The said pronouncements foreshadowed and are

adopted in the Family Code of the Philippines
(Executive Order No. 209, as amended by Executive
Order No. 227, effective on August 3, 1988), Article 26
whereof provides that "(w)here marriage between a
Filipino citizen and a foreigner is validly celebrated and
a divorce is thereafter validly obtained abroad by the
alien spouse capacitating him or her to remarry, the
Filipino spouse shall likewise have capacity to re under
Philippine law.

26 U.S. vs. Mata, 18 Phil. 490 (1911).

27 Footnote 20, ante.

54
 G.R. No. 138322 October 2, 2001
GRACE J. GARCIA, a.k.a. GRACE J. GARCIA-
RECIO, petitioner,
vs.
REDERICK A. RECIO, respondents.
PANGANIBAN, J.:
A divorce obtained abroad by an alien may be
recognized in our jurisdiction, provided such decree is
valid according to the national law of the foreigner.
However, the divorce decree and the governing
personal law of the alien spouse who obtained the
divorce must be proven. Our courts do not take judicial
notice of foreign laws and judgment; hence, like any
other facts, both the divorce decree and the national
law of the alien must be alleged and proven according
to our law on evidence.
The Case
Before us is a Petition for Review under Rule 45 of the
Rules of Court, seeking to nullify the January 7, 1999
Decision1 and the March 24, 1999 Order2 of the
Regional Trial Court of Cabanatuan City, Branch 28, in
Civil Case No. 3026-AF. The assailed Decision
disposed as follows:
"WHEREFORE, this Court declares the marriage
between Grace J. Garcia and Rederick A. Recio
solemnized on January 12, 1994 at Cabanatuan City
as dissolved and both parties can now remarry under
existing and applicable laws to any and/or both
parties."3
The assailed Order denied reconsideration of the
above-quoted Decision.
The Facts
Rederick A. Recio, a Filipino, was married to Editha
Samson, an Australian citizen, in Malabon, Rizal, on
March 1, 1987.4 They lived together as husband and
wife in Australia. On May 18, 1989,5 a decree of
divorce, purportedly dissolving the marriage, was
Republic of the Philippines
issued by an Australian family court.
SUPREME COURT
Manila On June 26, 1992, respondent became an Australian
citizen, as shown by a "Certificate of Australian
THIRD DIVISION
Citizenship" issued by the Australian
government.6 Petitioner – a Filipina – and respondent
were married on January 12, 1994 in Our Lady of
Perpetual Help Church in Cabanatuan City.7 In
their application for a marriage license, respondent
was declared as "single" and "Filipino."8
Starting October 22, 1995, petitioner and respondent
lived separately without prior judicial dissolution of their
marriage. While the two were still in Australia, their
conjugal assets were divided on May 16, 1996, in
accordance with their Statutory Declarations secured
in Australia.9
On March 3, 1998, petitioner filed a Complaint for
Declaration of Nullity of Marriage10 in the court a quo,
on the ground of bigamy – respondent allegedly had a
prior subsisting marriage at the time he married her on
January 12, 1994. She claimed that she learned of
respondent's marriage to Editha Samson only in
November, 1997.
In his Answer, respondent averred that, as far back as
1993, he had revealed to petitioner his prior
marriage andits subsequent dissolution.11 He
contended that his first marriage to an Australian
citizen had been validly dissolved by a divorce decree
obtained in Australian in 1989;12 thus, he was legally
capacitated to marry petitioner in 1994.1âwphi1.nêt
On July 7, 1998 – or about five years after the couple's
wedding and while the suit for the declaration of nullity
was pending – respondent was able to secure a
divorce decree from a family court in Sydney, Australia
because the "marriage ha[d] irretrievably broken
down."13
Respondent prayed in his Answer that the Complained
be dismissed on the ground that it stated no cause of
action.14 The Office of the Solicitor General agreed with
respondent.15 The court marked and admitted the
documentary evidence of both parties.16 After they
submitted their respective memoranda, the case was
submitted for resolution.17
Thereafter, the trial court rendered the assailed
Decision and Order.
Ruling of the Trial Court
The trial court declared the marriage dissolved on the
ground that the divorce issued in Australia was valid
55
and recognized in the Philippines. It deemed the
marriage ended, but not on the basis of any defect in
an essential element of the marriage; that
is, respondent's alleged lack of legal capacity to
remarry. Rather, it based its Decision on the divorce
decree obtained by respondent. The Australian divorce
had ended the marriage; thus, there was no more
martial union to nullify or annual.
Hence, this Petition.18
Issues
Petitioner submits the following issues for our
consideration:
"I
The trial court gravely erred in finding that the divorce
decree obtained in Australia by the respondent ipso
facto terminated his first marriage to Editha Samson
thereby capacitating him to contract a second marriage
with the petitioner.
"2
The failure of the respondent, who is now a naturalized
Australian, to present a certificate of legal capacity to
marry constitutes absence of a substantial requisite
voiding the petitioner' marriage to the respondent.
"3
The trial court seriously erred in the application of Art.
26 of the Family Code in this case.
"4
The trial court patently and grievously erred in
disregarding Arts. 11, 13, 21, 35, 40, 52 and 53 of the
Family Code as the applicable provisions in this case.
"5
The trial court gravely erred in pronouncing that the
divorce gravely erred in pronouncing that the divorce
decree obtained by the respondent in Australia ipso
facto capacitated the parties to remarry, without first
securing a recognition of the judgment granting the
divorce decree before our courts."19
The Petition raises five issues, but for purposes of this
Decision, we shall concentrate on two pivotal ones: (1)
whether the divorce between respondent and Editha
Samson was proven, and (2) whether respondent was
proven to be legally capacitated to marry petitioner.
Because of our ruling on these two, there is no more
necessity to take up the rest.
The Court's Ruling
The Petition is partly meritorious.
First Issue:
Proving the Divorce Between Respondent and
Editha Samson
Petitioner assails the trial court's recognition of the
divorce between respondent and Editha Samson.
Citing Adong v. Cheong Seng Gee,20 petitioner argues
that the divorce decree, like any other foreign
judgment, may be given recognition in this jurisdiction
only upon proof of the existence of (1) the foreign law
allowing absolute divorce and (2) the alleged divorce
decree itself. She adds that respondent miserably
failed to establish these elements.
Petitioner adds that, based on the first paragraph of
Article 26 of the Family Code, marriages solemnized
abroad are governed by the law of the place where they
were celebrated (the lex loci celebrationist). In effect,
the Code requires the presentation of the foreign law
to show the conformity of the marriage in question to
the legal requirements of the place where the marriage
was performed.
At the outset, we lay the following basic legal principles
as the take-off points for our discussion. Philippine law
does not provide for absolute divorce; hence, our
courts cannot grant it.21 A marriage between two
Filipinos cannot be dissolved even by a divorce
obtained abroad, because of Articles 1522 and 1723 of
the Civil Code.24 In mixed marriages involving a Filipino
and a foreigner, Article 2625 of the Family Code allows
the former to contract a subsequent marriage in case
the divorce is "validly obtained abroad by the alien
spouse capacitating him or her to remarry."26 A divorce
obtained abroad by a couple, who are both aliens, may
be recognized in the Philippines, provided it is
consistent with their respective national laws.27
A comparison between marriage and divorce, as far as
pleading and proof are concerned, can be made. Van
Dorn v. Romillo Jr. decrees that "aliens may obtain
divorces abroad, which may be recognized in the
Philippines, provided they are valid according to their
national law."28 Therefore, before a foreign divorce
decree can be recognized by our courts, the party
pleading it must prove the divorce as a fact and
demonstrate its conformity to the foreign law allowing
it.29 Presentation solely of the divorce decree is
insufficient.
Divorce as a Question of Fact
Petitioner insists that before a divorce decree can be
admitted in evidence, it must first comply with the
registration requirements under Articles 11, 13 and 52
of the Family Code. These articles read as follows:
"ART. 11. Where a marriage license is required, each
of the contracting parties shall file separately a sworn
application for such license with the proper local civil
registrar which shall specify the following:
xxx xxx xxx
"(5) If previously married, how, when and where the
previous marriage was dissolved or annulled;
xxx xxx xxx
"ART. 13. In case either of the contracting parties has
been previously married, the applicant shall be
required to furnish, instead of the birth of baptismal
certificate required in the last preceding article, the
death certificate of the deceased spouse or the judicial
decree of annulment or declaration of nullity of his or
her previous marriage. x x x.
"ART. 52. The judgment of annulment or of absolute
nullity of the marriage, the partition and distribution of
the properties of the spouses, and the delivery of the
children's presumptive legitimes shall be recorded in
the appropriate civil registry and registries of property;
otherwise, the same shall not affect their persons."
Respondent, on the other hand, argues that the
Australian divorce decree is a public document – a
written official act of an Australian family court.
Therefore, it requires no further proof of its authenticity
and due execution.
56
Respondent is getting ahead of himself. Before a
foreign judgment is given presumptive evidentiary
value, the document must first be presented and
admitted in evidence.30 A divorce obtained abroad is
proven by the divorce decree itself. Indeed the best
evidence of a judgment is the judgment itself. 31 The
decree purports to be a written act or record of an act
of an officially body or tribunal of a foreign country.32
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 33 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.34
The divorce decree between respondent and Editha
Samson appears to be an authentic one issued by an
Australian family court.35 However, appearance is not
sufficient; compliance with the aforemetioned rules on
evidence must be demonstrated.
Fortunately for respondent's cause, when the divorce
decree of May 18, 1989 was submitted in evidence,
counsel for petitioner objected, not to its admissibility,
but only to the fact that it had not been registered in the
Local Civil Registry of Cabanatuan City.36 The trial
court ruled that it was admissible, subject to petitioner's
qualification.37Hence, it was admitted in evidence and
accorded weight by the judge. Indeed, petitioner's
failure to object properly rendered the divorce decree
admissible as a written act of the Family Court of
Sydney, Australia.38
Compliance with the quoted articles (11, 13 and 52) of
the Family Code is not necessary; respondent was no
longer bound by Philippine personal laws after he
acquired Australian citizenship in
1992.39 Naturalization is the legal act of adopting an
alien and clothing him with the political and civil rights
belonging to a citizen.40 Naturalized citizens, freed
from the protective cloak of their former states, don the
attires of their adoptive countries. By becoming an
Australian, respondent severed his allegiance to the
Philippines and the vinculum juris that had tied him to
Philippine personal laws.
Burden of Proving Australian Law
Respondent contends that the burden to prove
Australian divorce law falls upon petitioner, because
she is the party challenging the validity of a foreign
judgment. He contends that petitioner was satisfied
with the original of the divorce decree and was
cognizant of the marital laws of Australia, because she
had lived and worked in that country for quite a long
time. Besides, the Australian divorce law is allegedly
known by Philippine courts: thus, judges may take
judicial notice of foreign laws in the exercise of sound
discretion.
We are not persuaded. The burden of proof lies with
"the party who alleges the existence of a fact or thing
necessary in the prosecution or defense of an
action."41 In civil cases, plaintiffs have the burden of
proving the material allegations of the complaint when
those are denied by the answer; and defendants have
the burden of proving the material allegations in their
answer when they introduce new matters. 42 Since the
divorce was a defense raised by respondent, the
burden of proving the pertinent Australian law
validating it falls squarely upon him.
It is well-settled in our jurisdiction that our courts cannot
take judicial notice of foreign laws.43 Like any other
facts, they must be alleged and proved. Australian
marital laws are not among those matters that judges
are supposed to know by reason of their judicial
function.44 The power of judicial notice must be
exercised with caution, and every reasonable doubt
upon the subject should be resolved in the negative.
Second Issue:
Respondent's Legal Capacity to Remarry
Petitioner contends that, in view of the insufficient proof
of the divorce, respondent was legally incapacitated to
marry her in 1994.
Hence, she concludes that their marriage was void ab
initio.
Respondent replies that the Australian divorce decree,
which was validly admitted in evidence, adequately
established his legal capacity to marry under Australian
law.
Respondent's contention is untenable. In its strict legal
sense, divorce means the legal dissolution of a lawful
union for a cause arising after marriage. But divorces
are of different types. The two basic ones are (1)
absolute divorce or a vinculo matrimonii and (2) limited
divorce or a mensa et thoro. The first kind terminates
the marriage, while the second suspends it and leaves
the bond in full force.45 There is no showing in the case
at bar which type of divorce was procured by
respondent.
Respondent presented a decree nisi or an interlocutory
decree – a conditional or provisional judgment of
divorce. It is in effect the same as a separation from
bed and board, although an absolute divorce may
follow after the lapse of the prescribed period during
which no reconciliation is effected.46
Even after the divorce becomes absolute, the court
may under some foreign statutes and practices, still
restrict remarriage. Under some other jurisdictions,
remarriage may be limited by statute; thus, the guilty
party in a divorce which was granted on the ground of
adultery may be prohibited from remarrying again. The
court may allow a remarriage only after proof of good
behavior.47
On its face, the herein Australian divorce decree
contains a restriction that reads:
"1. A party to a marriage who marries again before this
decree becomes absolute (unless the other party has
died) commits the offence of bigamy."48
This quotation bolsters our contention that the divorce
obtained by respondent may have been restricted. It
did not absolutely establish his legal capacity to
remarry according to his national law. Hence, we find
no basis for the ruling of the trial court, which
erroneously assumed that the Australian divorce ipso
facto restored respondent's capacity to remarry
despite the paucity of evidence on this matter.
We also reject the claim of respondent that the divorce
decree raises a disputable presumption or presumptive
evidence as to his civil status based on Section 48,
Rule 3949 of the Rules of Court, for the simple reason
57

that no proof has been presented on the legal effects
of the divorce decree obtained under Australian laws.
Significance of the Certificate of Legal Capacity
Petitioner argues that the certificate of legal capacity
required by Article 21 of the Family Code was not
submitted together with the application for a marriage
license. According to her, its absence is proof that
respondent did not have legal capacity to remarry.
We clarify. To repeat, the legal capacity to contract
marriage is determined by the national law of the party
concerned. The certificate mentioned in Article 21 of
the Family Code would have been sufficient to
establish the legal capacity of respondent, had he duly
presented it in court. A duly authenticated and admitted
certificate is prima facie evidence of legal capacity to
marry on the part of the alien applicant for a marriage
license.50
As it is, however, there is absolutely no evidence that
proves respondent's legal capacity to marry petitioner.
A review of the records before this Court shows that
only the following exhibits were presented before the
lower court: (1) for petitioner: (a) Exhibit "A" –
Complaint;51 (b) Exhibit "B" – Certificate of Marriage
Between Rederick A. Recto (Filipino-Australian) and
Grace J. Garcia (Filipino) on January 12, 1994 in
Cabanatuan City, Nueva Ecija;52(c) Exhibit "C" –
Certificate of Marriage Between Rederick A. Recio
(Filipino) and Editha D. Samson (Australian) on March
1, 1987 in Malabon, Metro Manila;53 (d) Exhibit "D" –
Office of the City Registrar of Cabanatuan City
Certification that no information of annulment between
Rederick A. Recto and Editha D. Samson was in its
records;54 and (e) Exhibit "E" – Certificate of Australian
Citizenship of Rederick A. Recto;55 (2) for respondent:
(Exhibit "1" – Amended Answer;56 (b) Exhibit "S" –
Family Law Act 1975 Decree Nisi of Dissolution of
Marriage in the Family Court of Australia;57 (c) Exhibit
"3" – Certificate of Australian Citizenship of Rederick A.
Recto;58 (d) Exhibit "4" – Decree Nisi of Dissolution of
Marriage in the Family Court of Australia
Certificate;59 and Exhibit "5" – Statutory Declaration of
the Legal Separation Between Rederick A. Recto and
Grace J. Garcia Recio since October 22, 1995.60
Based on the above records, we cannot conclude that
respondent, who was then a naturalized Australian
citizen, was legally capacitated to marry petitioner on
January 12, 1994. We agree with petitioner's
contention that the court a quo erred in finding that the
divorce decree ipso facto clothed respondent with the
legal capacity to remarry without requiring him to
adduce sufficient evidence to show the Australian
personal law governing his status; or at the very least,
to prove his legal capacity to contract the second
marriage.
Neither can we grant petitioner's prayer to declare her
marriage to respondent null and void on the ground of
bigamy. After all, it may turn out that under Australian
law, he was really capacitated to marry petitioner as a
direct result of the divorce decree. Hence, we believe
that the most judicious course is to remand this case to
the trial court to receive evidence, if any, which show
petitioner's legal capacity to marry petitioner. Failing in
that, then the court a quo may declare a nullity of the
parties' marriage on the ground of bigamy, there being
already in evidence two existing marriage certificates,
which were both obtained in the Philippines, one in
Malabon, Metro Manila dated March 1, 1987 and the
other, in Cabanatuan City dated January 12, 1994.
WHEREFORE, in the interest of orderly procedure and
substantial justice, we REMAND the case to the
court a quo for the purpose of receiving evidence
which conclusively show respondent's legal capacity to
marry petitioner; and failing in that, of declaring the
parties' marriage void on the ground of bigamy, as
above discussed. No costs.
SO ORDERED.
Melo, Puno, Vitug, and Sandoval-Gutierrez, JJ.,
concur.
Footnotes
1Penned by Judge Feliciano V. Buenaventura; rollo,
pp. 7-9.
2 Rollo, p. 10.
3 Ibid, p. 9.
4
Rollo, p. 37.
5 Ibid., p. 47.
6 xxx
Id., p. 44.
7
Id., p. 36.
8
Annex "I"; temporary rollo, p. 9.
9The couple secured an Australian "Statutory
Declaration" of their legal separation and division of
conjugal assets. See Annexes "3" and "4" of
Respondent's Comment; rollo, p. 48.
10 Id., pp. 33-35.
11 Id., p. 39.
12 Amended Answer, p. 2; rollo, p. 39.
13 Id., pp. 77-78.
14 Id., p. 43.
15 Rollo, pp. 48-51.
16TSN, December 16, 1998, pp. 1-8; records, pp. 172-
179.
17
RTC Order of December 16, 1998; ibid., p. 203.
18 The case was deemed submitted for decision on
January 11, 2000, upon this Court's receipt of the
Memorandum for petitioner, signed by Atty. Olivia
Velasco-Jacoba. The Memorandum for respondent,
signed by Atty. Gloria V. Gomez of Gomez and
Associates, had been filed on December 10, 1999.
19Petitioner's Memorandum, pp. 8-9; rollo, pp. 242-
243.
20
43 Phil. 43, 49, March 3, 1922.
21
Ruben F. Balane, "Family Courts and Significant
Jurisprudence in Family Law," Journal of the
Integrated Bar of the Philippines, 1st & 2nd Quarters,
2001, Vol. XXVII, No. 1, p. 25.
22
"ART. 15. Laws relating to family rights and duties,
or to the status, condition and legal capacity of persons
are binding upon citizens of the Philippines, even
though living abroad."
23"ART. 17. The forms and solemnities of contracts,
wills, and other public instruments shall be governed
by the laws of the country in which they are executed.
xxx xxx
58

"Prohibitive laws concerning persons, their acts or
property, and those which have for their object public
order, public policy and good customs shall not be
rendered ineffective by laws or judgments
promulgated, or by determinations or conventions
agreed upon in a foreign country."
25Tenchaves v. Escano 15 SCRA 355, 362, November
29, 1965; Barretto Gonzalez v. Gonzales, 58 Phil. 67,
71-72, March 7, 1933.
"Art. 26. All marriages solemnized outside the
Philippines in accordance with the laws in force in the
country where they were solemnized, and valid there
as such, shall also be valid in this country, except those
prohibited under Articles 35(1), (4), (5), and (6), 36, 37,
and 38. (71a).
"Where a marriage between a Filipino citizen and a
foreigner is validly celebrated and a divorce is
thereafter validly obtained abroad by the alien spouse
capacitating him or her to remarry, the Filipino spouse
shall have capacity to remarry under Philippine law."
(As amended by EO 227, prom. July 27, 1987).
26
Cf. Van Dorn v. Romillo Jr., 139 SCRA 139, 143-144,
October 8, 1985; and Pilapil v. Ibay-Somera, 174
SCRA 653, 663, June 30, 1989.1âwphi1.nêt
27 Van Dorn v. Romillo Jr., supra.
28
Ibid., p. 143.
29For a detailed discussion of Van Dorn, see Salonga,
Private International Law, 1995 ed. pp. 295-300.See
also Jose C. Vitug, Compendium of Civil Law and
Jurisprudence, 1993 ed., p. 16;
30 "SEC. 19. Classes of documents. – For the purpose
of their presentation in evidence, documents are either
public or private.
"Public documents are:
"(a) The written official acts, or records of the official
acts of the sovereign authority, official bodies and
tribunals, and public officers, whether in the
Philippines, or of a foreign country.
xxx xxx x x x."
31 35
Burr W. Jones, Commentaries on the Law of The transcript of stenographic notes states that the
Evidence in Civil Cases, Vol. IV, 1926 ed., p. 3511; §3, original copies of the divorce decrees were presented
Rule 130 of the Rules on Evidence provides that "when in court (TSN, December 16, 1998, p. 5; records, p.
the subject of inquiry is the contents of a document, no 176), but only photocopies of the same documents
evidence shall be admissible other than the original were attached to the records (Records, Index of
document itself." Exhibit, p. 1.).
32 "SEC. 19. Classes of documents. – For the purpose 36 TSN, December 15, 1998, p. 7; records, p. 178.
of their presentation in evidence, documents are either
37
public or private. TSN, December 16, 1998, p. 7; records, p. 178.
38
Public documents are: People v. Yatco, 97 Phil. 941, 945, November 28,
1955; Marella v. Reyes, 12 Phil. 1, 3, November 10,
"(a) The written official acts, or records of the official 1908; People v. Diaz, 271 SCRA 504, 516, April 18,
acts of the sovereign authority, official bodies and 1997; De la Torre v. Court of Appeals, 294 SCRA 196,
tribunals, and public officers, whether in the 203-204, August 14, 1998, Maunlad Savings & Loan
Philippines, or of a foreign country. Asso., Inc. v. Court of Appeals, GR No. 114942,
November 27, 2000, pp. 8-9.
xxx xxx x x x."
39
Art. 15, Civil Code.
33 "Sec. 25. What attestation of copy must state. –
40
Whenever a copy of a document or record is attested Joaquin Bernas, The 1987 Constitution of the
for the purpose of evidence, the attestation must state, Republic of the Philippines: A Commentary, 1996 ed.,
in substance, that the copy is a correct copy of the p. 566.
original, or a specific part thereof, as the case may be.
41
The attestation must be under the official seal of the Ricardo J. Francisco, Evidence: Rules of Court in the
attesting officer, if there be any, or if he be the clerk of Philippines, second edition, p. 382.
a court having a seal, under the seal of such court." 42 Ibid., p. 384.
34 "Sec. 24. Proof of official record. – The record of 43
Wildvalley Shipping Co., Ltd. v. Court of Appeals,
public documents referred to in paragraph (a) of
GR No. 119602, October 56, 2000, p. 7.
Section 19, when admissible for any purpose, may be
evidenced by an official publication thereof or by a copy 44Francisco, p. 29, citing De los Angeles v. Cabahug,
attested by the officer having the legal custody of the 106 839, December 29, 1959.
record, or by his deputy, and accompanied, if the
record is not kept in the Philippines, with a certificate 45 274 CJS, 15-17, §1.
that such officer has the custody. If the office in which
46
the record is kept is in a foreign country, the certificate Ibid., p. 611-613, §161.
may be made by a secretary of the embassy or 47
27A CJS, 625, §162.
legation, consul general, consul, vice-consul, or
consular agent or by any officer in the foreign service 48 Rollo, p. 36.
of the Philippines stationed in the foreign country in
which the record is kept, and authenticated by the seal 49"SEC. 48. Effect of foreign judgments or final orders.
of his office." – The effect of a judgment or final order of a tribunal of
a foreign country, having jurisdiction to render the
See also Asiavest Ltd. v. Court of Appeals, 296 SCRA judgment or final order is as follows:
539, 550-551, September 25, 1998; Pacific Asia
Overseas Shipping Corp. v. National Labor Relations xxx xxx xxx
Commission, 161 SCRA 122, 133-134, May 6, 1988.
"(b) In case of a judgment or final order against a
person, the judgment or final order is presumptive
59
evidence of a right as between the parties and their resolution. The prescribed period lapsed without the
successors in interest by a subsequent title. required documents being submitted.
BELLOSILLO, J.:
"In either case, the judgment or final order may be The trial court invoking Tenchavez v. Escaño 1 which
repelled by evidence of a want of jurisdiction, want of FE D. QUITA and Arturo T. Padlan, both Filipinos, were held that "a foreign divorce between Filipino citizens
notice to the party, collusion, fraud, or clear mistake of married in the Philippines on 18 May 1941. They were sought and decreed after the effectivity of the present
law or fact." not however blessed with children. Somewhere along Civil Code (Rep. Act 386) was not entitled to
the way their relationship soured. Eventually Fe sued recognition as valid in this jurisdiction," 2 disregarded
50 In passing, we note that the absence of the said Arturo for divorce in San Francisco, California, U.S.A. the divorce between petitioner and Arturo.
certificate is merely an irregularity in complying with the She submitted in the divorce proceedings a private Consecuently, it expressed the view that their marriage
formal requirement for procuring a marriage license. writing dated 19 July 1950 evidencing their agreement subsisted until the death of Arturo in 1972. Neither did
Under Article 4 of the Family Code, an irregularity will to live separately from each other and a settlement of it consider valid their extrajudicial settlement of
not affect the validity of a marriage celebrated on the their conjugal properties. On 23 July 1954 she obtained conjugal properties due to lack of judicial
basis of a marriage license issued without that a final judgment of divorce. Three (3) weeks thereafter approval. 3 On the other hand, it opined that there was
certificate. (Vitug, Compendium, pp. 120-126); she married a certain Felix Tupaz in the same locality no showing that marriage existed between private
Sempio-Diy, Handbook on the Family Code of the but their relationship also ended in a divorce. Still in the respondent and Arturo, much less was it shown that
Philippines, 197 reprint, p. 17; Rufus Rodriguez, The U.S.A., she married for the third time, to a certain the alleged Padlan children had been acknowledged
Family Code of the Philippines Annotated, 1990 ed., p. Wernimont. by the deceased as his children with her. As regards
42; Melencio Sta. Maria Jr., Persons and Family Ruperto, it found that he was a brother of Arturo. On 27
Relations Law, 1999 ed., p. 146.). On 16 April 1972 Arturo died. He left no will. On 31 November 1987 4 only petitioner and Ruperto were
August 1972 Lino Javier Inciong filed a petition with the
51 declared the intestate heirs of Arturo. Accordingly,
Records, pp. 1-3. Regional Trial Court of Quezon City for issuance of
equal adjudication of the net hereditary estate was
letters of administration concerning the estate of Arturo ordered in favor of the two intestate heirs. 5
52 Ibid., p. 4. in favor of the Philippine Trust Company. Respondent
53 Blandina Dandan (also referred to as Blandina On motion for reconsideration, Blandina and the
Id., p. 5.
Padlan), claiming to be the surviving spouse of Arturo Padlan children were allowed to present proofs that the
54 Id., p. 180. Padlan, and Claro, Alexis, Ricardo, Emmanuel, recognition of the children by the deceased as his
Zenaida and Yolanda, all surnamed Padlan, named in legitimate children, except Alexis who was recognized
55 the children of Arturo Padlan opposed the petition and
Id., pp. 170-171. as his illegitimate child, had been made in their
prayed for the appointment instead of Atty. Leonardo respective records of birth. Thus on 15 February
26 Id., pp. 84-89. Casaba, which was resolved in favor of the latter. Upon 1988 6 partial reconsideration was granted declaring
57
motion of the oppositors themselves, Atty. Cabasal the Padlan children, with the exception of Alexis,
Id., pp. 181-182. was later replaced by Higino Castillon. On 30 April entitled to one-half of the estate to the exclusion of
58 Id., pp. 40-41. 1973 the oppositors (Blandina and Padlan children) Ruperto Padlan, and petitioner to the other
submitted certified photocopies of the 19 July 1950 half. 7 Private respondent was not declared an heir.
59 Id., pp. 183. 60 Id., pp. 184-187. private writing and the final judgment of divorce Although it was stated in the aforementioned records
between petitioner and Arturo. Later Ruperto T. of birth that she and Arturo were married on 22 April
Republic of the Philippines Padlan, claiming to be the sole surviving brother of the 1947, their marriage was clearly void since it was
SUPREME COURT deceased Arturo, intervened. celebrated during the existence of his previous
Manila marriage to petitioner.
On 7 October 1987 petitioner moved for the immediate
SECOND DIVISION declaration of heirs of the decedent and the distribution In their appeal to the Court of Appeals, Blandina and
of his estate. At the scheduled hearing on 23 October her children assigned as one of the errors allegedly
1987, private respondent as well as the six (6) Padlan committed by the trial court the circumstance that the
children and Ruperto failed to appear despite due case was decided without a hearing, in violation of Sec.
G.R. No. 124862 December 22, 1998
notice. On the same day, the trial court required the 1, Rule 90, of the Rules of Court, which provides that if
FE D. QUITA, petitioner, submission of the records of birth of the Padlan there is a controversy before the court as to who are
vs. children within ten (10) days from receipt thereof, after the lawful heirs of the deceased person or as to the
COURT OF APPEALS and BLANDINA which, with or without the documents, the issue on the distributive shares to which each person is entitled
DANDAN, * respondents. declaration of heirs would be considered submitted for
60
under the law, the controversy shall be heard and
decided as in ordinary cases.
Respondent appellate court found this ground alone
sufficient to sustain the appeal; hence, on 11
September 1995 it declared null and void the 27
November 1987 decision and 15 February 1988 order
of the trial court, and directed the remand of the case
to the trial court for further proceedings. 8 On 18 April
1996 it denied reconsideration.9
Should this case be remanded to the lower court for
further proceedings? Petitioner insists that there is no
need because, first, no legal or factual issue obtains for
resolution either as to the heirship of the Padlan
children or as to the decedent; and, second, the issue
as to who between petitioner and private respondent is
the proper hier of the decedent is one of law which can
be resolved in the present petition based on establish
facts and admissions of the parties.
We cannot sustain petitioner. The provision relied upon
by respondent court is clear: If there is
a controversybefore the court as to who are the lawful
heirs of the deceased person or as to the distributive
shares to which each person is entitled under the law,
the controversy shall be heard and decided as in
ordinary cases.
We agree with petitioner that no dispute exists either
as to the right of the six (6) Padlan children to inherit
from the decedent because there are proofs that they
have been duly acknowledged by him and petitioner
herself even recognizes them as heirs of Arturo
Padlan; 10 nor as to their respective hereditary shares.
But controversy remains as to who is the legitimate
surviving spouse of Arturo. The trial court, after the
parties other than petitioner failed to appear during the
scheduled hearing on 23 October 1987 of the motion
for immediate declaration of heirs and distribution of
estate, simply issued an order requiring the submission
of the records of birth of the Padlan children within ten
(10) days from receipt thereof, after which, with or
without the documents, the issue on declaration of
heirs would be deemed submitted for resolution.
We note that in her comment to petitioner's motion
private respondent raised, among others, the issue as
to whether petitioner was still entitled to inherit from the
decedent considering that she had secured a divorce
in the U.S.A. and in fact had twice remarried. She also
invoked the above quoted procedural rule. 11 To this,
petitioner replied that Arturo was a Filipino and as such
remained legally married to her in spite of the divorce
they obtained. 12Reading between the lines, the
implication is that petitioner was no longer a Filipino
citizen at the time of her divorce from Arturo. This
should have prompted the trial court to conduct a
hearing to establish her citizenship. The purpose of a
hearing is to ascertain the truth of the matters in issue
with the aid of documentary and testimonial evidence
as well as the arguments of the parties either
supporting or opposing the evidence. Instead, the
lower court perfunctorily settled her claim in her favor
by merely applying the ruling in Tenchavez v. Escaño.
Then in private respondent's motion to set aside and/or
reconsider the lower court's decision she stressed that
the citizenship of petitioner was relevant in the light of
the ruling in Van Dorn v. Romillo Jr. 13 that aliens may
obtain divorces abroad, which may be recognized in
the Philippines, provided they are valid according to
their national law. She prayed therefore that the case
be set for hearing. 14 Petitioner opposed the motion but
failed to squarely address the issue on her
citizenship. 15 The trial court did not grant private
respondent's prayer for a hearing but proceeded to
resolve her motion with the finding that both petitioner
and Arturo were "Filipino citizens and were married in
the Philippines." 16 It maintained that their divorce
obtained in 1954 in San Francisco, California, U.S.A.,
was not valid in Philippine jurisdiction. We deduce that
the finding on their citizenship pertained solely to the
time of their marriage as the trial court was not supplied
with a basis to determine petitioner's citizenship at the
time of their divorce. The doubt persisted as to whether
she was still a Filipino citizen when their divorce was
decreed. The trial court must have overlooked the
materiality of this aspect. Once proved that she was no
longer a Filipino citizen at the time of their divorce, Van
Dorn would become applicable and petitioner could
very well lose her right to inherit from Arturo.
Respondent again raised in her appeal the issue on
petitioner's citizenship; 17 it did not merit enlightenment
however from petitioner. 18 In the present proceeding,
petitioner's citizenship is brought anew to the fore by
private respondent. She even furnishes the Court with
the transcript of stenographic notes taken on 5 May
1995 during the hearing for the reconstitution of the
original of a certain transfer certificate title as well as
the issuance of new owner's duplicate copy thereof
before another trial court. When asked whether she
was an American citizen petitioner answered that she
was since 1954. 19 Significantly, the decree of divorce
of petitioner and Arturo was obtained in the same year.
Petitioner however did not bother to file a reply
memorandum to erase the uncertainty about her
citizenship at the time of their divorce, a factual issue
requiring hearings to be conducted by the trial court.
Consequently, respondent appellate court did not err in
ordering the case returned to the trial court for further
proceedings.
We emphasize however that the question to be
determined by the trial court should be limited only to
the right of petitioner to inherit from Arturo as his
surviving spouse. Private respondent's claim to
heirship was already resolved by the trial court. She
and Arturo were married on 22 April 1947 while the
prior marriage of petitioner and Arturo was subsisting
thereby resulting in a bigamous marriage considered
void from the beginning under Arts. 80 and 83 of the
Civil Code. Consequently, she is not a surviving
spouse that can inherit from him as this status
presupposes a legitimate relationship. 20
As regards the motion of private respondent for
petitioner and a her counsel to be declared in contempt
of court and that the present petition be dismissed for
forum shopping, 21 the same lacks merit. For forum
shopping to exist the actions must involve the same
transactions and same essential facts and
circumstances. There must also be identical causes of
action, subject matter and issue. 22 The present
petition deals with declaration of heirship while the
subsequent petitions filed before the three (3) trial
courts concern the issuance of new owner's duplicate
copies of titles of certain properties belonging to the
estate of Arturo. Obviously, there is no reason to
declare the existence of forum shopping.
WHEREFORE, the petition is DENIED. The decision of
respondent Court of Appeals ordering the remand of
the case to the court of origin for further proceedings
and declaring null and void its decision holding
petitioner Fe D. Quita and Ruperto T. Padlan as
intestate heirs is AFFIRMED. The order of the
appellate court modifying its previous decision by
granting one-half (1/2) of the net hereditary estate to
61
the Padlan children, namely, Claro, Ricardo,
Emmanuel, Zenaida and Yolanda, with the exception
of Alexis, all surnamed Padlan, instead of Arturo's
brother Ruperto Padlan, is likewise AFFIRMED. The
Court however emphasizes that the reception of
evidence by the trial court should he limited to the
hereditary rights of petitioner as the surviving spouse
of Arturo Padlan.
widow or widower shall be entitled to one-half of the
inheritance, and the illegitimate children or their
descendent, whether legitimate or illegitimate, to the
other half.
8 Decision penned by Justice Pacita Cañazares-Nye
with the concurrence of Justices Romeo J. Callejo Jr.
and Delilah Vidallon-Magtolis; Rollo, p. 39.

The motion to declare petitioner and her counsel in 9 Id., p. 42.

contempt of court and to dismiss the present petition
10 Id., p. 180.
for forum shopping is DENIED.
11 Rollo, p. 196.
SO ORDERED.
12 CA Rollo, p. 29.
Puno, Mendoza and Martinez, JJ., concur.

Footnotes 13 G.R. No. 68470, 8 October 1985, 139 SCRA 139.

14 CA Rollo, p. 30.
* The name of private respondent Blandina Dandan
appears as Blandina Padlan in the proceedings before 15 Record on Appeal, pp. 24-26.
the lower courts.
16 Rollo, p. 206.
1 No. L-19671, 29 November 1965, 15 SCRA 355.
17 Brief of Oppositors-Appellant, p. 13; CA Rollo, p.
2 Id., p. 367. 15.
3 Then Art. 190 of the Civil Code provided that in the 18 Brief of Appellee: Id., p. 17.
absence of an express declaration in the marriage
settlement, the separation of property between 19 Rollo, pp. 225-226.
spouses during the marriage shall not take place save
in virtue of a judicial order. Quite in relation thereto, 20 Arturo M. Tolentino, Commentaries and
then Art. 191, par. 4 of the same Code provided that Jurisprudence on the Civil Code of the Philippines,
the husband and the wife may agree upon the 1979 Ed., Vol. III, p. 264.
dissolution of the conjugal partnership during the
marriage, subject to judicial approval. 21 Rollo, pp. 129-132.

4 Decision penned by Judge Tomas V. Tadeo Jr. of 22 Professional Regulation Commission v. Court of
RTC- Br. 105, Quezon City; Appendix "A" of Brief for Appeals, G.R. No. 117817, 9 July 1998.
the Oppositors-Appellants; CA Rollo, p. 15.

5 Art. 1001 of the Civil Code provides that should

brothers and sisters or their children survive with the
widow or widower, the latter shall be entitled to one-
half of the inheritance and the brothers and sisters or
their children to the other half.

6 Appendix "B" of Brief for the Oppositors-

Appellants; See Note 4.

7 Art. 998 of the Civil Code provides that if a widow or

widower survives with illegitimate children, such as
62
 ELMAR O. PEREZ, Petitioner,
vs.
COURT OF APPEALS, Fifth Division, TRISTAN A.
CATINDIG and LILY GOMEZ-
CATINDIG, Respondents.
DECISION
YNARES-SANTIAGO, J.:
This petition for certiorari and prohibition under Rule 65
of the Rules of Court assails the July 25, 2003
Decision1of the Court of Appeals in CA-G.R. SP No.
74456 which set aside and declared as null and void
the September 30, 2002 Order2 of the Regional Trial
Court of Quezon City, Branch 84, granting petitioner’s
motion for leave to file intervention and admitting the
Complaint-in-Intervention3 in Civil Case No. Q-01-
44847; and its January 23, 2004 Resolution4 denying
the motion for reconsideration.
Private respondent Tristan A. Catindig married Lily
Gomez Catindig5 twice on May 16, 1968. The first
marriage ceremony was celebrated at the Central
Methodist Church at T.M. Kalaw Street, Ermita, Manila
while the second took place at the Lourdes Catholic
Church in La Loma, Quezon City. The marriage
produced four children.
Several years later, the couple encountered marital
problems that they decided to separate from each
other. Upon advice of a mutual friend, they decided to
obtain a divorce from the Dominican Republic. Thus,
on April 27, 1984, Tristan and Lily executed a Special
Power of Attorney addressed to the Judge of the First
Civil Court of San Cristobal, Dominican Republic,
appointing an attorney-in-fact to institute a divorce
action under its laws.6
Thereafter, on April 30, 1984, the private respondents
filed a joint petition for dissolution of conjugal
partnership with the Regional Trial Court of Makati. On
June 12, 1984, the civil court in the Dominican Republic
Republic of the Philippines ratified the divorce by mutual consent of Tristan and
SUPREME COURT Lily. Subsequently, on June 23, 1984, the Regional
Manila Trial Court of Makati City, Branch 133, ordered the
complete separation of properties between Tristan and
FIRST DIVISION
Lily.
G.R. No. 162580 January 27, 2006
On July 14, 1984, Tristan married petitioner Elmar O.
Perez in the State of Virginia in the United States7 and
both lived as husband and wife until October 2001.
Their union produced one offspring.8
During their cohabitation, petitioner learned that the
divorce decree issued by the court in the Dominican
Republic which "dissolved" the marriage between
Tristan and Lily was not recognized in the Philippines
and that her marriage to Tristan was deemed void
under Philippine law. When she confronted Tristan
about this, the latter assured her that he would legalize
their union after he obtains an annulment of his
marriage with Lily. Tristan further promised the
petitioner that he would adopt their son so that he
would be entitled to an equal share in his estate as that
of each of his children with Lily.9
On August 13, 2001, Tristan filed a petition for the
declaration of nullity of his marriage to Lily with the
Regional Trial Court of Quezon City, docketed as Case
No. Q-01-44847.
Subsequently, petitioner filed a Motion for Leave to File
Intervention10 claiming that she has a legal interest in
the matter in litigation because she knows certain
information which might aid the trial court at a truthful,
fair and just adjudication of the annulment case, which
the trial court granted on September 30, 2002.
Petitioner’s complaint-in-intervention was also ordered
admitted.
Tristan filed a petition for certiorari and prohibition with
the Court of Appeals seeking to annul the order dated
September 30, 2002 of the trial court. The Court of
Appeals granted the petition and declared as null and
void the September 30, 2002 Order of the trial court
granting the motion for leave to file intervention and
admitting the complaint-in-intervention.
Petitioner’s motion for reconsideration was denied,
hence this petition for certiorari and prohibition filed
under Rule 65 of the Rules of Court. Petitioner
contends that the Court of Appeals gravely abused its
discretion in disregarding her legal interest in the
annulment case between Tristan and Lily.
The petition lacks merit.
Ordinarily, the proper recourse of an aggrieved party
from a decision of the Court of Appeals is a petition for
review on certiorari under Rule 45 of the Rules of
Court. However, if the error subject of the recourse is
63
one of jurisdiction, or the act complained of was
granted by a court with grave abuse of discretion
amounting to lack or excess of jurisdiction, as alleged
in this case, the proper remedy is a petition for certiorari
under Rule 65 of the said Rules.11 This is based on the
premise that in issuing the assailed decision and
resolution, the Court of Appeals acted with grave
abuse of discretion, amounting to excess of lack of
jurisdiction and there is no plain, speedy and adequate
remedy in the ordinary course of law. A remedy is
considered plain, speedy, and adequate if it will
promptly relieve the petitioner from the injurious effect
of the judgment and the acts of the lower court.12
It is therefore incumbent upon the petitioner to
establish that the Court of Appeals acted with grave
abuse of discretion amounting to excess or lack of
jurisdiction when it promulgated the assailed decision
and resolution.
We have previously ruled that grave abuse of
discretion may arise when a lower court or tribunal
violates or contravenes the Constitution, the law or
existing jurisprudence. By grave abuse of discretion is
meant, such capricious and whimsical exercise of
judgment as is equivalent to lack of jurisdiction. The
abuse of discretion must be grave as where the power
is exercised in an arbitrary or despotic manner by
reason of passion or personal hostility and 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
by or to act at all in contemplation of law.13 The word
"capricious," usually used in tandem with the term
"arbitrary," conveys the notion of willful and
unreasoning action. Thus, when seeking the corrective
hand of certiorari, a clear showing of caprice and
arbitrariness in the exercise of discretion is
imperative.14
The Rules of Court laid down the parameters before a
person, not a party to a case can intervene, thus:
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.15
The requirements for intervention are: [a] legal interest
in the matter in litigation; and [b] consideration must be
given as to whether the adjudication of the original
parties may be delayed or prejudiced, or whether the
intervenor’s rights may be protected in a separate
proceeding or not.16
Legal interest, which entitles a person to intervene,
must be in the matter in litigation and of such direct and
immediate character that the intervenor will either gain
or lose by direct legal operation and effect of the
judgment.17 Such interest must be actual, direct and
material, and not simply contingent and expectant. 18
Petitioner claims that her status as the wife and
companion of Tristan for 17 years vests her with the
requisite legal interest required of a would-be
intervenor under the Rules of Court.
Petitioner’s claim lacks merit. Under the law, petitioner
was never the legal wife of Tristan, hence her claim of
legal interest has no basis.
When petitioner and Tristan married on July 14, 1984,
Tristan was still lawfully married to Lily. The divorce
decree that Tristan and Lily obtained from the
Dominican Republic never dissolved the marriage
bond between them. It is basic that laws relating to
family rights and duties, or to the status, condition and
legal capacity of persons are binding upon citizens of
the Philippines, even though living
abroad.19 Regardless of where a citizen of the
Philippines might be, he or she will be governed by
Philippine laws with respect to his or her family rights
and duties, or to his or her status, condition and legal
capacity. Hence, if a Filipino regardless of whether he
or she was married here or abroad, initiates a petition
abroad to obtain an absolute divorce from spouse and
eventually becomes successful in getting an absolute
divorce decree, the Philippines will not recognize such
absolute divorce.20
When Tristan and Lily married on May 18, 1968, their
marriage was governed by the provisions of the Civil
Code21 which took effect on August 30, 1950. In the
case of Tenchavez v. Escano22 we held:
(1) That a foreign divorce between Filipino citizens,
sought and decreed after the effectivity of the present
Civil Code (Rep. Act No. 386), is not entitled to
recognition as valid in this jurisdiction; and neither is
the marriage contracted with another party by the
divorced consort, subsequently to the foreign decree of
divorce, entitled to validity in the country. (Emphasis
added)
Thus, petitioner’s claim that she is the wife of Tristan
even if their marriage was celebrated abroad lacks
merit. Thus, petitioner never acquired the legal interest
as a wife upon which her motion for intervention is
based.
Since petitioner’s motion for leave to file intervention
was bereft of the indispensable requirement of legal
interest, the issuance by the trial court of the order
granting the same and admitting the complaint-in-
intervention was attended with grave abuse of
discretion. Consequently, the Court of Appeals
correctly set aside and declared as null and void the
said order.
WHEREFORE, the petition is DISMISSED. The
assailed Decision dated July 25, 2003 and Resolution
dated January 23, 2004 of the Court of Appeals in CA-
G.R. SP No. 74456 are AFFIRMED.
No pronouncement as to costs.
SO ORDERED.
CONSUELO YNARES-SANTIAGO
Associate Justice
WE CONCUR:
ARTEMIO V. PANGANIBAN
Chief Justice
Chairperson
MA. ALICIA AUSTRIA- ROMEO J.
MARTINEZ CALLEJO, SR.
Associate Justice Asscociate Justice
MINITA V. CHICO-NAZARIO
Associate Justice
64
 15
CERTIFICATION RULES OF COURT, Rule 19, Sec. 1.
16
Pursuant to Section 13, Article VIII of the Constitution, Nordic Asia Limited v. Court of Appeals, G.R. No.
it is hereby certified that the conclusions in the above 111159, July 13, 2004, 434 SCRA 195, 198.
Decision were reached in consultation before the
17
case was assigned to the writer of the opinion of the Id. at 199.
Court’s Division. 18Pagtalunan v. Tamayo, G.R. No. 54281, March 19,
ARTEMIO V. PANGANIBAN 1990, 183 SCRA 252, 257.
Chief Justice 19 CIVIL CODE, Art. 15.
20Sta. Maria, Persons and Family Relations, Fourth
Edition, p. 23.
Footnotes 21 Republic Act No. 386 (1950).
1Rollo, pp. 26-31. Penned by Associate Justice 22 122 Phil. 752, 765 (1965).
Eugenio S. Labitoria and concurred in by Associate
Justices Andres B. Reyes, Jr. and Regalado E.
Maambong.
2Id. at 74. Penned by Judge Mariflor P. Punzalan
Castillo.
3 Id. at 49-58.
4 Id. at 33.
5
Referred as Lily Corazon Catindig in some parts of
the records.
6 Rollo, p. 27.
7 Id. at 34.
8 Id. at 35.
9 Id. at 28.
10 Id. at 45-48.
11Delgado v. Court of Appeals, G.R. No. 137881,
December 21, 2004, 447 SCRA 402, 411.
12Tomas Claudio Memorial College, Inc. v. Court of
Appeals, G.R. No. 152568, February 16, 2004, 423
SCRA 122, 132.
13Banal III v. Panganiban, G.R. No. 167474,
November 15, 2005.
14Olanolan v. Commission on Elections, G.R. No.
165491, March 31, 2005, 454 SCRA 807, 814.

65

Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 133743 February 6, 2007
EDGAR SAN LUIS, Petitioner,
vs.
FELICIDAD SAN LUIS, Respondent.
x ---------------------------------------------------- x
G.R. No. 134029 February 6, 2007
RODOLFO SAN LUIS, Petitioner,
vs.
FELICIDAD SAGALONGOS alias FELICIDAD SAN
LUIS, Respondent.
DECISION
YNARES-SANTIAGO, J.:
Before us are consolidated petitions for review
assailing the February 4, 1998 Decision 1 of the Court
of Appeals in CA-G.R. CV No. 52647, which reversed
and set aside the September 12, 1995 2 and January
31, 1996 3Resolutions of the Regional Trial Court of
Makati City, Branch 134 in SP. Proc. No. M-3708; and
its May 15, 1998 Resolution 4 denying petitioners’
motion for reconsideration.
The instant case involves the settlement of the estate
of Felicisimo T. San Luis (Felicisimo), who was the
former governor of the Province of Laguna. During his
lifetime, Felicisimo contracted three marriages. His first
marriage was with Virginia Sulit on March 17, 1942 out
of which were born six children, namely: Rodolfo, Mila,
Edgar, Linda, Emilita and Manuel. On August 11, 1963,
Virginia predeceased Felicisimo.
Five years later, on May 1, 1968, Felicisimo married
Merry Lee Corwin, with whom he had a son, Tobias.
However, on October 15, 1971, Merry Lee, an
American citizen, filed a Complaint for Divorce 5 before
the Family Court of the First Circuit, State of Hawaii,
United States of America (U.S.A.), which issued a
Decree Granting Absolute Divorce and Awarding Child
Custody on December 14, 1973. 6
On June 20, 1974, Felicisimo married respondent
Felicidad San Luis, then surnamed Sagalongos, before
Rev. Fr. William Meyer, Minister of the United
Presbyterian at Wilshire Boulevard, Los Angeles,
California, U.S.A. 7 He had no children with respondent
but lived with her for 18 years from the time of their
marriage up to his death on December 18, 1992.
Thereafter, respondent sought the dissolution of their
conjugal partnership assets and the settlement of
Felicisimo’s estate. On December 17, 1993, she filed a
petition for letters of administration 8 before the
Regional Trial Court of Makati City, docketed as SP.
Proc. No. M-3708 which was raffled to Branch 146
thereof.
Respondent alleged that she is the widow of
Felicisimo; that, at the time of his death, the decedent
was residing at 100 San Juanico Street, New Alabang
Village, Alabang, Metro Manila; that the decedent’s
surviving heirs are respondent as legal spouse, his six
children by his first marriage, and son by his second
marriage; that the decedent left real properties, both
conjugal and exclusive, valued at P30,304,178.00
more or less; that the decedent does not have any
unpaid debts. Respondent prayed that the conjugal
partnership assets be liquidated and that letters of
administration be issued to her.
On February 4, 1994, petitioner Rodolfo San Luis, one
of the children of Felicisimo by his first marriage, filed
a motion to dismiss 9 on the grounds of improper venue
and failure to state a cause of action. Rodolfo claimed
that the petition for letters of administration should
have been filed in the Province of Laguna because this
was Felicisimo’s place of residence prior to his death.
He further claimed that respondent has no legal
personality to file the petition because she was only a
mistress of Felicisimo since the latter, at the time of his
death, was still legally married to Merry Lee.
On February 15, 1994, Linda invoked the same
grounds and joined her brother Rodolfo in seeking the
dismissal10 of the petition. On February 28, 1994, the
66
trial court issued an Order 11 denying the two motions
to dismiss.
Unaware of the denial of the motions to dismiss,
respondent filed on March 5, 1994 her
opposition 12 thereto. She submitted documentary
evidence showing that while Felicisimo exercised the
powers of his public office in Laguna, he regularly went
home to their house in New Alabang Village, Alabang,
Metro Manila which they bought sometime in 1982.
Further, she presented the decree of absolute divorce
issued by the Family Court of the First Circuit, State of
Hawaii to prove that the marriage of Felicisimo to Merry
Lee had already been dissolved. Thus, she claimed
that Felicisimo had the legal capacity to marry her by
virtue of paragraph 2, 13 Article 26 of the Family Code
and the doctrine laid down in Van Dorn v. Romillo, Jr. 14
Thereafter, Linda, Rodolfo and herein petitioner Edgar
San Luis, separately filed motions for reconsideration
from the Order denying their motions to
dismiss. 15 They asserted that paragraph 2, Article 26
of the Family Code cannot be given retroactive effect
to validate respondent’s bigamous marriage with
Felicisimo because this would impair vested rights in
derogation of Article 256 16 of the Family Code.
On April 21, 1994, Mila, another daughter of Felicisimo
from his first marriage, filed a motion to disqualify
Acting Presiding Judge Anthony E. Santos from
hearing the case.
On October 24, 1994, the trial court issued an
Order 17 denying the motions for reconsideration. It
ruled that respondent, as widow of the decedent,
possessed the legal standing to file the petition and
that venue was properly laid. Meanwhile, the motion for
disqualification was deemed moot and
academic 18 because then Acting Presiding Judge
Santos was substituted by Judge Salvador S. Tensuan
pending the resolution of said motion.
Mila filed a motion for inhibition 19 against Judge
Tensuan on November 16, 1994. On even date, Edgar
also filed a motion for reconsideration 20 from the Order
denying their motion for reconsideration arguing that it
does not state the facts and law on which it was based.
On November 25, 1994, Judge Tensuan issued an
Order 21 granting the motion for inhibition. The case
was re-raffled to Branch 134 presided by Judge Paul
T. Arcangel.
On April 24, 1995, 22 the trial court required the parties
to submit their respective position papers on the twin
issues of venue and legal capacity of respondent to file
the petition. On May 5, 1995, Edgar manifested 23 that
he is adopting the arguments and evidence set forth in
his previous motion for reconsideration as his position
paper. Respondent and Rodolfo filed their position
papers on June 14, 24 and June 20, 25 1995,
respectively.
On September 12, 1995, the trial court dismissed the
petition for letters of administration. It held that, at the
time of his death, Felicisimo was the duly elected
governor and a resident of the Province of Laguna.
Hence, the petition should have been filed in Sta. Cruz,
Laguna and not in Makati City. It also ruled that
respondent was without legal capacity to file the
petition for letters of administration because her
marriage with Felicisimo was bigamous, thus, void ab
initio. It found that the decree of absolute divorce
dissolving Felicisimo’s marriage to Merry Lee was not
valid in the Philippines and did not bind Felicisimo who
was a Filipino citizen. It also ruled that paragraph 2,
Article 26 of the Family Code cannot be retroactively
applied because it would impair the vested rights of
Felicisimo’s legitimate children.
Respondent moved for reconsideration 26 and for the
disqualification 27 of Judge Arcangel but said motions
were denied. 28
Respondent appealed to the Court of Appeals which
reversed and set aside the orders of the trial court in its
assailed Decision dated February 4, 1998, the
dispositive portion of which states:
WHEREFORE, the Orders dated September 12, 1995
and January 31, 1996 are hereby REVERSED and
SET ASIDE; the Orders dated February 28 and
October 24, 1994 are REINSTATED; and the records
of the case is REMANDED to the trial court for further
proceedings. 29
The appellante court ruled that under Section 1, Rule
73 of the Rules of Court, the term "place of residence"
of the decedent, for purposes of fixing the venue of the
settlement of his estate, refers to the personal, actual
or physical habitation, or actual residence or place of
abode of a person as distinguished from legal
residence or domicile. It noted that although Felicisimo
discharged his functions as governor in Laguna, he
actually resided in Alabang, Muntinlupa. Thus, the
petition for letters of administration was properly filed
in Makati City.
The Court of Appeals also held that Felicisimo had
legal capacity to marry respondent by virtue of
paragraph 2, Article 26 of the Family Code and the
rulings in Van Dorn v. Romillo, Jr. 30 and Pilapil v. Ibay-
Somera. 31 It found that the marriage between
Felicisimo and Merry Lee was validly dissolved by
virtue of the decree of absolute divorce issued by the
Family Court of the First Circuit, State of Hawaii. As a
result, under paragraph 2, Article 26, Felicisimo was
capacitated to contract a subsequent marriage with
respondent. Thus –
With the well-known rule – express mandate of
paragraph 2, Article 26, of the Family Code of the
Philippines, the doctrines in Van Dorn, Pilapil, and the
reason and philosophy behind the enactment of E.O.
No. 227, — there is no justiciable reason to sustain the
individual view — sweeping statement — of Judge
Arc[h]angel, that "Article 26, par. 2 of the Family Code,
contravenes the basic policy of our state against
divorce in any form whatsoever." Indeed, courts cannot
deny what the law grants. All that the courts should do
is to give force and effect to the express mandate of
the law. The foreign divorce having been obtained by
the Foreigner on December 14, 1992,32 the Filipino
divorcee, "shall x x x have capacity to remarry under
Philippine laws". For this reason, the marriage between
the deceased and petitioner should not be
denominated as "a bigamous marriage.
Therefore, under Article 130 of the Family Code, the
petitioner as the surviving spouse can institute the
judicial proceeding for the settlement of the estate of
the deceased. x x x 33
Edgar, Linda, and Rodolfo filed separate motions for
reconsideration 34 which were denied by the Court of
Appeals.
On July 2, 1998, Edgar appealed to this Court via the
instant petition for review on certiorari. 35 Rodolfo later
67
filed a manifestation and motion to adopt the said
petition which was granted. 36
In the instant consolidated petitions, Edgar and
Rodolfo insist that the venue of the subject petition for
letters of administration was improperly laid because at
the time of his death, Felicisimo was a resident of Sta.
Cruz, Laguna. They contend that pursuant to our
rulings in Nuval v. Guray 37 and Romualdez v. RTC, Br.
7, Tacloban City, 38 "residence" is synonymous with
"domicile" which denotes a fixed permanent residence
to which when absent, one intends to return. They
claim that a person can only have one domicile at any
given time. Since Felicisimo never changed his
domicile, the petition for letters of administration should
have been filed in Sta. Cruz, Laguna.
Petitioners also contend that respondent’s marriage to
Felicisimo was void and bigamous because it was
performed during the subsistence of the latter’s
marriage to Merry Lee. They argue that paragraph 2,
Article 26 cannot be retroactively applied because it
would impair vested rights and ratify the void bigamous
marriage. As such, respondent cannot be considered
the surviving wife of Felicisimo; hence, she has no legal
capacity to file the petition for letters of administration.
The issues for resolution: (1) whether venue was
properly laid, and (2) whether respondent has legal
capacity to file the subject petition for letters of
administration.
The petition lacks merit.
Under Section 1, 39 Rule 73 of the Rules of Court, the
petition for letters of administration of the estate of
Felicisimo should be filed in the Regional Trial Court of
the province "in which he resides at the time of his
death." In the case of Garcia Fule v. Court of
Appeals, 40 we laid down the doctrinal rule for
determining the residence – as contradistinguished
from domicile – of the decedent for purposes of fixing
the venue of the settlement of his estate:
[T]he term "resides" connotes ex vi termini "actual
residence" as distinguished from "legal residence or
domicile." This term "resides," like the terms "residing"
and "residence," is elastic and should be interpreted in
the light of the object or purpose of the statute or rule
in which it is employed. In the application of venue
statutes and rules – Section 1, Rule 73 of the Revised
Rules of Court is of such nature – residence rather than
domicile is the significant factor. Even where the
statute uses the word "domicile" still it is construed as
meaning residence and not domicile in the technical
sense. Some cases make a distinction between the
terms "residence" and "domicile" but as generally used
in statutes fixing venue, the terms are synonymous,
and convey the same meaning as the term "inhabitant."
In other words, "resides" should be viewed or
understood in its popular sense, meaning, the
personal, actual or physical habitation of a person,
actual residence or place of abode. It signifies physical
presence in a place and actual stay thereat. In this
popular sense, the term means merely residence, that
is, personal residence, not legal residence or domicile.
Residence simply requires bodily presence as an
inhabitant in a given place, while domicile requires
bodily presence in that place and also an intention to
make it one’s domicile. No particular length of time of
residence is required though; however, the residence
must be more than temporary. 41 (Emphasis supplied)
It is incorrect for petitioners to argue that "residence,"
for purposes of fixing the venue of the settlement of the
estate of Felicisimo, is synonymous with "domicile."
The rulings in Nuval and Romualdez are inapplicable
to the instant case because they involve election
cases. Needless to say, there is a distinction between
"residence" for purposes of election laws and
"residence" for purposes of fixing the venue of actions.
In election cases, "residence" and "domicile" are
treated as synonymous terms, that is, the fixed
permanent residence to which when absent, one has
the intention of returning. 42 However, for purposes of
fixing venue under the Rules of Court, the "residence"
of a person is his personal, actual or physical
habitation, or actual residence or place of abode, which
may not necessarily be his legal residence or domicile
provided he resides therein with continuity and
consistency. 43 Hence, it is possible that a person may
have his residence in one place and domicile in
another.
In the instant case, while petitioners established that
Felicisimo was domiciled in Sta. Cruz, Laguna,
respondent proved that he also maintained a residence
in Alabang, Muntinlupa from 1982 up to the time of his
death. Respondent submitted in evidence the Deed of
Absolute Sale 44 dated January 5, 1983 showing that
the deceased purchased the aforesaid property. She
also presented billing statements 45 from the Philippine
Heart Center and Chinese General Hospital for the
period August to December 1992 indicating the
address of Felicisimo at "100 San Juanico, Ayala
Alabang, Muntinlupa." Respondent also presented
proof of membership of the deceased in the Ayala
Alabang Village Association 46 and Ayala Country
Club, Inc., 47 letter-envelopes 48from 1988 to 1990 sent
by the deceased’s children to him at his Alabang
address, and the deceased’s calling cards 49 stating
that his home/city address is at "100 San Juanico,
Ayala Alabang Village, Muntinlupa" while his
office/provincial address is in "Provincial Capitol, Sta.
Cruz, Laguna."
From the foregoing, we find that Felicisimo was a
resident of Alabang, Muntinlupa for purposes of fixing
the venue of the settlement of his estate.
Consequently, the subject petition for letters of
administration was validly filed in the Regional Trial
Court 50 which has territorial jurisdiction over Alabang,
Muntinlupa. The subject petition was filed on
December 17, 1993. At that time, Muntinlupa was still
a municipality and the branches of the Regional Trial
Court of the National Capital Judicial Region which had
territorial jurisdiction over Muntinlupa were then seated
in Makati City as per Supreme Court Administrative
Order No. 3. 51 Thus, the subject petition was validly
filed before the Regional Trial Court of Makati City.
Anent the issue of respondent Felicidad’s legal
personality to file the petition for letters of
administration, we must first resolve the issue of
whether a Filipino who is divorced by his alien spouse
abroad may validly remarry under the Civil Code,
considering that Felicidad’s marriage to Felicisimo was
solemnized on June 20, 1974, or before the Family
Code took effect on August 3, 1988. In resolving this
issue, we need not retroactively apply the provisions of
the Family Code, particularly Art. 26, par. (2)
considering that there is sufficient jurisprudential basis
allowing us to rule in the affirmative.
The case of Van Dorn v. Romillo, Jr. 52 involved a
marriage between a foreigner and his Filipino wife,
which marriage was subsequently dissolved through a
divorce obtained abroad by the latter. Claiming that the
divorce was not valid under Philippine law, the alien
spouse alleged that his interest in the properties from
68
their conjugal partnership should be protected. The
Court, however, recognized the validity of the divorce
and held that the alien spouse had no interest in the
properties acquired by the Filipino wife after the
divorce. Thus:
In this case, the divorce in Nevada released private
respondent from the marriage from the standards of
American law, under which divorce dissolves the
marriage. As stated by the Federal Supreme Court of
the United States in Atherton vs. Atherton, 45 L. Ed.
794, 799:
"The purpose and effect of a decree of divorce from the
bond of matrimony by a competent jurisdiction are to
change the existing status or domestic relation of
husband and wife, and to free them both from the bond.
The marriage tie, when thus severed as to one party,
ceases to bind either. A husband without a wife, or a
wife without a husband, is unknown to the law. When
the law provides, in the nature of a penalty, that the
guilty party shall not marry again, that party, as well as
the other, is still absolutely freed from the bond of the
former marriage."
Thus, pursuant to his national law, private respondent
is no longer the husband of petitioner. He would have
no standing to sue in the case below as petitioner’s
husband entitled to exercise control over conjugal
assets. As he is bound by the Decision of his own
country’s Court, which validly exercised jurisdiction
over him, and whose decision he does not repudiate,
he is estopped by his own representation before said
Court from asserting his right over the alleged conjugal
property. 53
As to the effect of the divorce on the Filipino wife, the
Court ruled that she should no longer be considered
married to the alien spouse. Further, she should not be
required to perform her marital duties and obligations.
It held:
To maintain, as private respondent does, that,
under our laws, petitioner has to be
considered still married to private respondent and
still subject to a wife's obligations under Article
109, et. seq. of the Civil Code cannot be
just. Petitioner should not be obliged to live together
with, observe respect and fidelity, and render support
to private respondent. The latter should not continue to
be one of her heirs with possible rights to conjugal
property. She should not be discriminated against
in her own country if the ends of justice are to be
served. 54 (Emphasis added)
This principle was thereafter applied in Pilapil v. Ibay-
Somera 55 where the Court recognized the validity of a
divorce obtained abroad. In the said case, it was held
that the alien spouse is not a proper party in filing the
adultery suit against his Filipino wife. The Court stated
that "the severance of the marital bond had the effect
of dissociating the former spouses from each
other, hence the actuations of one would not affect or
cast obloquy on the other." 56
Likewise, in Quita v. Court of Appeals, 57 the Court
stated that where a Filipino is divorced by his
naturalized foreign spouse, the ruling in Van
Dorn applies. 58 Although decided on December 22,
1998, the divorce in the said case was obtained in 1954
when the Civil Code provisions were still in effect.
The significance of the Van Dorn case to the
development of limited recognition of divorce in the
Philippines cannot be denied. The ruling has long been
interpreted as severing marital ties between parties in
a mixed marriage and capacitating the Filipino spouse
to remarry as a necessary consequence of upholding
the validity of a divorce obtained abroad by the alien
spouse. In his treatise, Dr. Arturo M. Tolentino
cited Van Dorn stating that "if the foreigner obtains a
valid foreign divorce, the Filipino spouse shall have
capacity to remarry under Philippine law." 59 In Garcia
v. Recio, 60 the Court likewise cited the aforementioned
case in relation to Article 26. 61
In the recent case of Republic v. Orbecido III, 62 the
historical background and legislative intent behind
paragraph 2, Article 26 of the Family Code were
discussed, to wit:
Brief Historical Background
On July 6, 1987, then President Corazon Aquino
signed into law Executive Order No. 209, otherwise
known as the "Family Code," which took effect on
August 3, 1988. Article 26 thereof states:
All marriages solemnized outside the Philippines in
accordance with the laws in force in the country where
they were solemnized, and valid there as such, shall
also be valid in this country, except those prohibited
under Articles 35, 37, and 38.
On July 17, 1987, shortly after the signing of the
original Family Code, Executive Order No. 227 was
likewise signed into law, amending Articles 26, 36, and
39 of the Family Code. A second paragraph was added
to Article 26. As so amended, it now provides:
ART. 26. All marriages solemnized outside the
Philippines in accordance with the laws in force in the
country where they were solemnized, and valid there
as such, shall also be valid in this country, except those
prohibited under Articles 35(1), (4), (5) and (6), 36, 37
and 38.
Where a marriage between a Filipino citizen and a
foreigner is validly celebrated and a divorce is
thereafter validly obtained abroad by the alien spouse
capacitating him or her to remarry, the Filipino spouse
shall have capacity to remarry under Philippine
law. (Emphasis supplied)
x x x x
Legislative Intent
Records of the proceedings of the Family Code
deliberations showed that the intent of Paragraph 2 of
Article 26, according to Judge Alicia Sempio-Diy, a
member of the Civil Code Revision Committee, is to
avoid the absurd situation where the Filipino spouse
remains married to the alien spouse who, after
obtaining a divorce, is no longer married to the Filipino
spouse.
Interestingly, Paragraph 2 of Article 26 traces its
origin to the 1985 case of Van Dorn v. Romillo,
Jr. TheVan Dorn case involved a marriage between
a Filipino citizen and a foreigner. The Court held
therein that a divorce decree validly obtained by
the alien spouse is valid in the Philippines, and
consequently, the Filipino spouse is capacitated to
remarry under Philippine law. 63 (Emphasis added)
As such, the Van Dorn case is sufficient basis in
resolving a situation where a divorce is validly obtained
abroad by the alien spouse. With the enactment of the
Family Code and paragraph 2, Article 26 thereof, our
lawmakers codified the law already established
through judicial precedent.1awphi1.net
69
Indeed, when the object of a marriage is defeated by
rendering its continuance intolerable to one of the
parties and productive of no possible good to the
community, relief in some way should be
obtainable. 64 Marriage, being a mutual and shared
commitment between two parties, cannot possibly be
productive of any good to the society where one is
considered released from the marital bond while the
other remains bound to it. Such is the state of affairs
where the alien spouse obtains a valid divorce abroad
against the Filipino spouse, as in this case.
Petitioners cite Articles 15 65 and 17 66 of the Civil
Code in stating that the divorce is void under Philippine
law insofar as Filipinos are concerned. However, in
light of this Court’s rulings in the cases discussed
above, the Filipino spouse should not be discriminated
against in his own country if the ends of justice are to
be served. 67 In Alonzo v. Intermediate Appellate
Court, 68 the Court stated:
But as has also been aptly observed, we test a law by
its results; and likewise, we may add, by its purposes.
It is a cardinal rule that, in seeking the meaning of the
law, the first concern of the judge should be to discover
in its provisions the intent of the lawmaker.
Unquestionably, the law should never be interpreted in
such a way as to cause injustice as this is never within
the legislative intent. An indispensable part of that
intent, in fact, for we presume the good motives of the
legislature, is to render justice.
Thus, we interpret and apply the law not independently
of but in consonance with justice. Law and justice are
inseparable, and we must keep them so. To be sure,
there are some laws that, while generally valid, may
seem arbitrary when applied in a particular case
because of its peculiar circumstances. In such a
situation, we are not bound, because only of our nature
and functions, to apply them just the same, in slavish
obedience to their language. What we do instead is find
a balance between the word and the will, that justice
may be done even as the law is obeyed.
As judges, we are not automatons. We do not and must
not unfeelingly apply the law as it is worded, yielding
like robots to the literal command without regard to its
cause and consequence. "Courts are apt to err by
sticking too closely to the words of a law," so we are
warned, by Justice Holmes again, "where these words
import a policy that goes beyond them."
xxxx
More than twenty centuries ago, Justinian defined
justice "as the constant and perpetual wish to render
every one his due." That wish continues to motivate
this Court when it assesses the facts and the law in
every case brought to it for decision. Justice is always
an essential ingredient of its decisions. Thus when the
facts warrants, we interpret the law in a way that will
render justice, presuming that it was the intention of the
lawmaker, to begin with, that the law be dispensed with
justice. 69
Applying the above doctrine in the instant case, the
divorce decree allegedly obtained by Merry Lee which
absolutely allowed Felicisimo to remarry, would have
vested Felicidad with the legal personality to file the
present petition as Felicisimo’s surviving spouse.
However, the records show that there is insufficient
evidence to prove the validity of the divorce obtained
by Merry Lee as well as the marriage of respondent
and Felicisimo under the laws of the U.S.A. In Garcia
v. Recio, 70 the Court laid down the specific guidelines
for pleading and proving foreign law and divorce
judgments. It held that presentation solely of the
divorce decree is insufficient and that proof of its
authenticity and due execution must be presented.
Under Sections 24 and 25 of Rule 132, 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. 71
With regard to respondent’s marriage to Felicisimo
allegedly solemnized in California, U.S.A., she
submitted photocopies of the Marriage Certificate and
the annotated text 72 of the Family Law Act of California
which purportedly show that their marriage was done
in accordance with the said law. As stated
in Garcia, however, the Court cannot take judicial
notice of foreign laws as they must be alleged and
proved. 73
Therefore, this case should be remanded to the trial
court for further reception of evidence on the divorce
decree obtained by Merry Lee and the marriage of
respondent and Felicisimo.
Even assuming that Felicisimo was not capacitated to
marry respondent in 1974, nevertheless, we find that
the latter has the legal personality to file the subject
petition for letters of administration, as she may be
considered the co-owner of Felicisimo as regards the
properties that were acquired through their joint efforts
during their cohabitation.
Section 6, 74 Rule 78 of the Rules of Court states that
letters of administration may be granted to the
surviving spouse of the decedent. However, Section 2,
Rule 79 thereof also provides in part:
SEC. 2. Contents of petition for letters of
administration. – A petition for letters of administration
must be filed by an interested person and must show,
as far as known to the petitioner: x x x.
An "interested person" has been defined as one who
would be benefited by the estate, such as an heir, or
one who has a claim against the estate, such as a
creditor. The interest must be material and direct, and
not merely indirect or contingent. 75
In the instant case, respondent would qualify as an
interested person who has a direct interest in the estate
of Felicisimo by virtue of their cohabitation, the
existence of which was not denied by petitioners. If she
proves the validity of the divorce and Felicisimo’s
capacity to remarry, but fails to prove that her marriage
with him was validly performed under the laws of the
U.S.A., then she may be considered as a co-owner
under Article 144 76 of the Civil Code. This provision
governs the property relations between parties who live
together as husband and wife without the benefit of
marriage, or their marriage is void from the beginning.
It provides that the property acquired by either or both
of them through their work or industry or their wages
and salaries shall be governed by the rules on co-
ownership. In a co-ownership, it is not necessary that
the property be acquired through their joint labor,
efforts and industry. Any property acquired during the
union is prima facie presumed to have been obtained
through their joint efforts. Hence, the portions
70
 1
belonging to the co-owners shall be presumed equal, WHEREFORE, the petition is DENIED. The Decision Rollo of G.R. No. 133743, pp. 45-66. Penned by
unless the contrary is proven. 77 of the Court of Appeals reinstating and affirming the Associate Justice Artemon D. Luna and concurred in
February 28, 1994 Order of the Regional Trial Court by Associate Justices Godardo A. Jacinto and Roberto
Meanwhile, if respondent fails to prove the validity of which denied petitioners’ motion to dismiss and its A. Barrios.
both the divorce and the marriage, the applicable October 24, 1994 Order which dismissed petitioners’
2
provision would be Article 148 of the Family Code motion for reconsideration is AFFIRMED. Let this case Records, pp. 335-338. Penned by Judge Paul T.
which has filled the hiatus in Article 144 of the Civil be REMANDED to the trial court for further Arcangel.
Code by expressly regulating the property relations of proceedings. 3
couples living together as husband and wife but are Id. at 391-393.
incapacitated to marry. 78In Saguid v. Court of SO ORDERED. 4Rollo of G.R. No. 133743, p. 68. Penned by Associate
Appeals, 79 we held that even if the cohabitation or the
CONSUELO YNARES-SANTIAGO Justice Artemon D. Luna and concurred in by
acquisition of property occurred before the Family
Associate Justice Associate Justices Demetrio G. Demetria and Roberto
Code took effect, Article 148 governs. 80 The Court
A. Barrios.
described the property regime under this provision as
WE CONCUR:
follows: 5 Records, p. 125.
The regime of limited co-ownership of property MA. ALICIA AUSTRIA- ROMEO J. 6
MARTINEZ CALLEJO, SR. Id. at 137.
governing the union of parties who are not legally
capacitated to marry each other, but who nonetheless Associate Justice Asscociate Justice 7 Id. at 116.
live together as husband and wife, applies to properties
MINITA V. CHICO-NAZARIO 8 Id. at 1-5.
acquired during said cohabitation in proportion to their
Associate Justice
respective contributions. Co-ownership will only be up 9
to the extent of the proven actual contribution of Id. at 10-24.
ATTESTATION
money, property or industry. Absent proof of the extent 10 Id. at 30-35.
thereof, their contributions and corresponding shares I attest that the conclusions in the above decision
shall be presumed to be equal. were reached in consultation before the case was 11 Id. at 38.
assigned to the writer of the opinion of the Court’s
xxxx Division. 12 Id. at 39-138.
In the cases of Agapay v. Palang, and Tumlos v. CONSUELO YNARES-SANTIAGO 13When a marriage between a Filipino citizen and a
Fernandez, which involved the issue of co-ownership Associate Justice foreigner is validly celebrated and a divorce is
of properties acquired by the parties to a bigamous Chairperson, Third Division thereafter validly obtained abroad by the alien spouse
marriage and an adulterous relationship, respectively, capacitating him or her to remarry, the Filipino spouse
we ruled that proof of actual contribution in the CERTIFICATION shall have capacity to remarry under Philippine law.
acquisition of the property is essential. x x x
Pursuant to Section 13, Article VIII of the Constitution 14 G.R. No. L-68470, October 8, 1985, 139 SCRA 139.
As in other civil cases, the burden of proof rests upon and the Division Chairperson’s Attestation, it is hereby
15
the party who, as determined by the pleadings or the certified that the conclusions in the above Decision See Records, pp. 155-158, 160-170 and 181-192.
nature of the case, asserts an affirmative issue. were reached in consultation before the case was 16
Contentions must be proved by competent evidence assigned to the writer of the opinion of the Court’s This Code shall have retroactive effect insofar as it
and reliance must be had on the strength of the party’s Division. does not prejudice or impair vested rights or acquired
own evidence and not upon the weakness of the rights in accordance with the Civil Code or other laws.
opponent’s defense. x x x81 REYNATO S. PUNO
17
Chief Justice Records, p. 259.
In view of the foregoing, we find that respondent’s legal 18 Id. at 260.
capacity to file the subject petition for letters of
administration may arise from her status as the 19 Id. at 262-267.
surviving wife of Felicisimo or as his co-owner under
Footnotes 20
Article 144 of the Civil Code or Article 148 of the Family Id. at 270-272.
Code.
21 Id. at 288.
71
22 41 57
Id. at 301. Id. at 199-200. G.R. No. 124862, December 22, 1998, 300 SCRA
406.
23 42
Id. at 302-303. Romualdez v. RTC, Br. 7, Tacloban City, supra note
58
38 at 415. Id. at 414; See also Republic v. Orbecido III, G.R.
24 Id. at 306-311. No. 154380, October 5, 2005, 472 SCRA 114, 121.
43See Boleyley v. Villanueva, 373 Phil. 141, 146
25 Id. at 318-320. (1999); Dangwa Transportation Co. Inc. v. Sarmiento, 59 Tolentino, Arturo M., Commentaries and
26 G.R. No. L-22795, January 31, 1977, 75 SCRA 124, Jurisprudence on the Civil Code of the Philippines, Vol.
Id. at 339-349.
128-129. I, 1990 ed., p. 263.
27 Id. at 350-354. 44 60
Records, pp. 76-78. G.R. No. 138322, October 2, 2001, 366 SCRA 437.
28 Id. at 391-393. 45 61
Id. at 60-75. Id. at 447.
29 Rollo of G.R. No. 133743, p. 66. 46 62
Id. at 79. Supra note 58.
30 Supra note 14. 47 63
Id. at 80. Id. at 119-121.
31 G.R. No. 80116, June 30, 1989, 174 SCRA 653. 48 64
Id. at 81-83. Goitia v. Campos Rueda, 35 Phil. 252, 254-255
32Parenthetically, it appears that the Court of Appeals (1916).
49 Id. at 84.
proceeded from a mistaken finding of fact because the 65 ART. 15. Laws relating to family rights and duties, or
records clearly show that the divorce was obtained on 50The Regional Trial Court and not the Municipal Trial to the status, condition and legal capacity of persons
December 14, 1973 (not December 14, 1992) and that Court had jurisdiction over this case because the value are binding upon citizens of the Philippines, even
the marriage of Gov. San Luis with respondent was of Gov. San Luis’ estate exceeded P200,000.00 as though living abroad.
celebrated on June 20, 1974. These events both provided for under B.P. Blg 129, Section 19(4).
occurred before the effectivity of the Family Code on 66Art. 17. x x x Prohibitive laws concerning persons,
August 3, 1988. 51SC Administrative Order No. 3 dated January 19, their acts or property, and those which have for their
1983 states in part: object public order, public policy and good customs
33 Rollo of G.R. No. 133743, p. 65.
shall not be rendered ineffective by laws or judgments
Pursuant to the provisions of Section 18 of B.P. Blg.
34 See CA rollo, pp. 309-322, 335-340, and 362-369. promulgated, or by determinations or conventions
129, and Section 4 of the Executive Order issued by
agreed upon in a foreign country.
35 the President of the Philippines on January 17, 1983,
Rollo of G.R. No. 133743, pp. 8-42.
declaring the reorganization of the Judiciary, the 67 Supra note 14 at 144.
36 Id. at 75. territorial jurisdiction of the Regional Trial Courts in the
68
National Capital Judicial Region are hereby defined as G.R. No. L-72873, May 28, 1987, 150 SCRA 259.
37 52 Phil. 645 (1928). follows:
69 Id. at 264-265, 268.
38G.R. No. 104960, September 14, 1993, 226 SCRA xxxx
70
408. Supra note 60.
5. Branches CXXXII to CL, inclusive, with seats at
71
39
SECTION 1. Where estate of deceased persons be Makati – over the municipalities of Las Pinas, Makati, Id. at 448-449.
settled. — If the decedent is an inhabitant of the Muntinlupa and Parañaque. x x x 72 Records, pp. 118-124.
Philippines at the time of his death, whether a citizen 52
or an alien, his will shall be proved, or letters of Supra note 14. 73 Supra note 60 at 451.
administration granted, and his estate settled, in the 53 Id. at 139, 143-144. 74
Court of First Instance in the province in which he SEC. 6. When and to whom letters of administration
resides at the time of his death, x x x. (Underscoring 54 Id. at 144. granted. – If x x x a person dies intestate,
supplied) administration shall be granted:
55 Supra note 31.
40G.R. Nos. L-40502 & L-42670, November 29, 1976, (a) To the surviving husband or wife, as the case may
56
74 SCRA 189. Id. at 664. be, or next of kin, or both, in the discretion of the court,

72
or to such person as such surviving husband or wife, BERSAMIN, J.:
or next of kin, requests to have appointed, if competent
and willing to serve; x x x. Divorce between Filipinos is void and ineffectual under
the nationality rule adopted by Philippine law. Hence,
75 Saguinsin v. Lindayag,116 Phil. 1193, 1195 (1962). any settlement of property between the parties of the
first marriage involving Filipinos submitted as an
76 Article 144 of the Civil Code reads in full: incident of a divorce obtained in a foreign country lacks
competent judicial approval, and cannot be
When a man and a woman live together as husband
enforceable against the assets of the husband who
and wife, but they are not married, or their marriage is
contracts a subsequent marriage.
void from the beginning, the property acquired by either
or both of them through their work or industry or their The Case
wages and salaries shall be governed by the rules on
co-ownership. The petitioner, the second wife of the late Atty. Juan
Luces Luna, appeals the adverse decision
77Valdes v. RTC, Br. 102, Quezon City, 328 Phil. 1289, promulgated on November 11, 2005,1 whereby the
1297 (1996). Court of Appeals (CA) affirmed with modification the
78 decision rendered on August 27, 2001 by the Regional
Francisco v. Master Iron Works & Construction
Trial Court (RTC), Branch 138, in Makati City.2 The CA
Corporation, G.R. No. 151967, February 16, 2005, 451
thereby denied her right in the 25/100 pro indiviso
SCRA 494, 506.
share of the husband in a condominium unit, and in the
79 G.R. No. 150611, June 10, 2003, 403 SCRA 678. law books of the husband acquired during the second
marriage.
80
Id. at 686.
Antecedents
81 Id. at 679, 686-687.
The antecedent facts were summarized by the CA as
follows:
ATTY. LUNA, a practicing lawyer, was at first a name
partner in the prestigious law firm Sycip, Salazar, Luna,
Manalo, Hernandez & Feliciano Law Offices at that
time when he was living with his first wife, herein
intervenor-appellant Eugenia Zaballero-Luna
(EUGENIA), whom he initially married ina civil
ceremony conducted by the Justice of the Peace of
Republic of the Philippines
Parañaque, Rizal on September 10, 1947 and later
SUPREME COURT
solemnized in a church ceremony at the Pro-Cathedral
Manila
in San Miguel, Bulacan on September 12, 1948. In
FIRST DIVISION ATTY. LUNA’s marriage to EUGENIA, they begot
seven (7) children, namely: Regina Maria L. Nadal,
G.R. No. 171914 July 23, 2014 Juan Luis Luna, Araceli Victoria L. Arellano, Ana Maria
L. Tabunda, Gregorio Macario Luna, Carolina Linda L.
SOLEDAD L. LAVADIA, Petitioner, Tapia, and Cesar Antonio Luna. After almost two (2)
vs. decades of marriage, ATTY. LUNA and EUGENIA
HEIRS OF JUAN LUCES LUNA, represented by eventually agreed to live apart from each other in
GREGORIO Z. LUNA and EUGENIA ZABALLERO- February 1966 and agreed to separation of property, to
LUNA,Respondents. which end, they entered into a written agreement
entitled "AGREEMENT FOR SEPARATION AND
DECISION PROPERTY SETTLEMENT" dated November 12,
1975, whereby they agreed to live separately and to
dissolve and liquidate their conjugal partnership of
property.
On January 12, 1976, ATTY. LUNA obtained a divorce
decree of his marriage with EUGENIA from the Civil
and Commercial Chamber of the First Circumscription
of the Court of First Instance of Sto. Domingo,
Dominican Republic. Also in Sto.Domingo, Dominican
Republic, on the same date, ATTY. LUNA contracted
another marriage, this time with SOLEDAD.
Thereafter, ATTY. LUNA and SOLEDAD returned to
the Philippines and lived together as husband and wife
until 1987.
Sometime in 1977, ATTY. LUNA organized a new law
firm named: Luna, Puruganan, Sison and Ongkiko
(LUPSICON) where ATTY. LUNA was the managing
partner.
On February 14, 1978, LUPSICON through ATTY.
LUNA purchased from Tandang Sora Development
Corporation the 6th Floor of Kalaw-Ledesma
Condominium Project(condominium unit) at Gamboa
St., Makati City, consisting of 517.52 square meters,
for P1,449,056.00, to be paid on installment basis for
36months starting on April 15, 1978. Said
condominium unit was to be usedas law office of
LUPSICON. After full payment, the Deed of Absolute
Sale over the condominium unit was executed on July
15, 1983, and CCT No. 4779 was issued on August 10,
1983, which was registered bearing the following
names:
"JUAN LUCES LUNA, married to Soledad L. Luna
(46/100); MARIO E. ONGKIKO, married to Sonia P.G.
Ongkiko (25/100); GREGORIO R. PURUGANAN,
married to Paz A. Puruganan (17/100); and TERESITA
CRUZ SISON, married to Antonio J.M. Sison (12/100)
x x x" Subsequently, 8/100 share of ATTY. LUNA and
17/100 share of Atty. Gregorio R. Puruganan in the
condominium unit was sold to Atty. Mario E. Ongkiko,
for which a new CCT No. 21761 was issued on
February 7, 1992 in the following names:
"JUAN LUCES LUNA, married to Soledad L. Luna
(38/100); MARIO E. ONGKIKO, married to Sonia P.G.
Ongkiko (50/100); TERESITA CRUZ SISON, married
to Antonio J.M. Sison (12/100) x x x"
73
Sometime in 1992, LUPSICON was dissolved and the
condominium unit was partitioned by the partners but
the same was still registered in common under CCT
No. 21716. The parties stipulated that the interest of
ATTY. LUNA over the condominium unit would be
25/100 share. ATTY. LUNA thereafter established and
headed another law firm with Atty. Renato G. Dela
Cruzand used a portion of the office condominium unit
as their office. The said law firm lasted until the death
of ATTY. JUAN on July 12, 1997.
After the death of ATTY. JUAN, his share in the
condominium unit including the lawbooks, office
furniture and equipment found therein were taken over
by Gregorio Z. Luna, ATTY. LUNA’s son of the first
marriage. Gregorio Z. Luna thenleased out the 25/100
portion of the condominium unit belonging to his father
to Atty. Renato G. De la Cruz who established his own
law firm named Renato G. De la Cruz & Associates.
The 25/100 pro-indiviso share of ATTY. Luna in the
condominium unit as well as the law books, office
furniture and equipment became the subject of the
complaint filed by SOLEDAD against the heirs of
ATTY. JUAN with the RTC of Makati City, Branch 138,
on September 10, 1999, docketed as Civil Case No.
99-1644. The complaint alleged that the subject
properties were acquired during the existence of the
marriage between ATTY. LUNA and SOLEDAD
through their joint efforts that since they had no
children, SOLEDAD became co-owner of the said
properties upon the death of ATTY. LUNA to the extent
of ¾ pro-indiviso share consisting of her ½ share in the
said properties plus her ½ share in the net estate of
ATTY. LUNA which was bequeathed to her in the
latter’s last will and testament; and thatthe heirs of
ATTY. LUNA through Gregorio Z. Luna excluded
SOLEDAD from her share in the subject properties.
The complaint prayed that SOLEDAD be declared the
owner of the ¾ portion of the subject properties;that the
same be partitioned; that an accounting of the rentals
on the condominium unit pertaining to the share of
SOLEDAD be conducted; that a receiver be appointed
to preserve ad administer the subject properties;and
that the heirs of ATTY. LUNA be ordered to pay
attorney’s feesand costs of the suit to SOLEDAD.3
Ruling of the RTC
On August 27, 2001, the RTC rendered its decision
after trial upon the aforementioned facts,4 disposing
thusly:
WHEREFORE, judgment is rendered as follows:
(a) The 24/100 pro-indiviso share in the condominium
unit located at the SIXTH FLOOR of the KALAW
LEDESMA CONDOMINIUM PROJECT covered by
Condominium Certificate of Title No. 21761 consisting
of FIVE HUNDRED SEVENTEEN (517/100) SQUARE
METERS is adjudged to have been acquired by Juan
Lucas Luna through his sole industry;
(b) Plaintiff has no right as owner or under any other
concept over the condominium unit, hence the entry in
Condominium Certificate of Title No. 21761 of the
Registry of Deeds of Makati with respect to the civil
status of Juan Luces Luna should be changed from
"JUAN LUCES LUNA married to Soledad L. Luna" to
"JUAN LUCES LUNA married to Eugenia Zaballero
Luna";
(c) Plaintiff is declared to be the owner of the books
Corpus Juris, Fletcher on Corporation, American
Jurisprudence and Federal Supreme Court Reports
found in the condominium unit and defendants are
ordered to deliver them to the plaintiff as soon as
appropriate arrangements have been madefor
transport and storage.
No pronouncement as to costs.
SO ORDERED.5
Decision of the CA
Both parties appealed to the CA.6
On her part, the petitioner assigned the following errors
to the RTC, namely:
I. THE LOWER COURT ERRED IN RULING THAT
THE CONDOMINIUM UNIT WAS ACQUIRED THRU
THE SOLE INDUSTRY OF ATTY. JUAN LUCES
LUNA;
II. THE LOWER COURT ERRED IN RULING THAT
PLAINTIFFAPPELLANT DID NOT CONTRIBUTE
MONEY FOR THE ACQUISITION OF THE
CONDOMINIUM UNIT;
III. THE LOWER COURT ERRED IN GIVING
CREDENCE TO PORTIONS OF THE TESTIMONY
OF GREGORIO LUNA, WHO HAS NO ACTUAL
KNOWLEDGE OF THE ACQUISITION OF THE UNIT,
BUT IGNORED OTHER PORTIONS OF HIS
TESTIMONY FAVORABLE TO THE PLAINTIFF-
APPELLANT;
IV. THE LOWER COURT ERRED IN NOT GIVING
SIGNIFICANCE TO THE FACT THAT THE
CONJUGAL PARTNERSHIP BETWEEN LUNA AND
INTERVENOR-APPELLANT WAS ALREADY
DISSOLVED AND LIQUIDATED PRIOR TO THE
UNION OF PLAINTIFF-APPELLANT AND LUNA;
V. THE LOWER COURT ERRED IN GIVING UNDUE
SIGNIFICANCE TO THE ABSENCE OF THE
DISPOSITION OF THE CONDOMINIUM UNIT IN THE
HOLOGRAPHIC WILL OF THE PLAINTIFF-
APPELLANT;
VI. THE LOWER COURT ERRED IN GIVING UNDUE
SIGNIFICANCE TO THE FACTTHAT THE NAME OF
PLAINTIFF-APPELLANT DID NOT APPEAR IN THE
DEED OF ABSOLUTE SALE EXECUTED BY
TANDANG SORA DEVELOPMENT CORPORATION
OVER THE CONDOMINIUM UNIT;
VII. THE LOWER COURT ERRED IN RULING THAT
NEITHER ARTICLE 148 OF THE FAMILYCODE NOR
ARTICLE 144 OF THE CIVIL CODE OF THE
PHILIPPINES ARE APPLICABLE;
VIII. THE LOWER COURT ERRED IN NOT RULING
THAT THE CAUSE OF ACTION OF THE
INTERVENOR-APPELLANT HAS BEEN BARRED BY
PESCRIPTION AND LACHES; and
IX. THE LOWER COURT ERRED IN NOT
EXPUNGING/DISMISSING THE INTERVENTION
FOR FAILURE OF INTERVENOR-APPELLANT TO
PAY FILING FEE.7
In contrast, the respondents attributedthe following
errors to the trial court, to wit:
I. THE LOWER COURT ERRED IN HOLDING THAT
CERTAIN FOREIGN LAW BOOKS IN THE LAW
OFFICE OF ATTY. LUNA WERE BOUGHT WITH THE
USE OF PLAINTIFF’S MONEY;
74
II. THE LOWER COURT ERRED IN HOLDING THAT
PLAINTIFF PROVED BY PREPONDERANCE OF
EVIDENCE (HER CLAIM OVER) THE SPECIFIED
FOREIGN LAW BOOKS FOUND IN ATTY. LUNA’S
LAW OFFICE; and
III. THE LOWER COURT ERRED IN NOT HOLDING
THAT, ASSUMING PLAINTIFF PAID FOR THE SAID
FOREIGN LAW BOOKS, THE RIGHT TO RECOVER
THEM HAD PRESCRIBED AND BARRED BY
LACHES AND ESTOPPEL.8
On November 11, 2005, the CA promulgated its
assailed modified decision,9 holding and ruling:
EUGENIA, the first wife, was the legitimate wife of
ATTY. LUNA until the latter’s death on July 12, 1997.
The absolute divorce decree obtained by ATTY. LUNA
inthe Dominican Republic did not terminate his prior
marriage with EUGENIA because foreign divorce
between Filipino citizens is not recognized in our
jurisdiction. x x x10
xxxx
WHEREFORE, premises considered, the assailed
August 27, 2001 Decision of the RTC of MakatiCity,
Branch 138, is hereby MODIFIEDas follows:
(a) The 25/100 pro-indiviso share in the condominium
unit at the SIXTH FLOOR of the KALAW LEDESMA
CONDOMINIUM PROJECT covered by Condominium
Certificate of Title No. 21761 consisting of FIVE
HUNDRED SEVENTEEN (517/100) (sic) SQUARE
METERS is hereby adjudged to defendants-
appellants, the heirs of Juan Luces Luna and Eugenia
Zaballero-Luna (first marriage), having been acquired
from the sole funds and sole industry of Juan Luces
Luna while marriage of Juan Luces Luna and Eugenia
Zaballero-Luna (first marriage) was still subsisting and
valid;
(b) Plaintiff-appellant Soledad Lavadia has no right as
owner or under any other concept over the
condominium unit, hence the entry in Condominium
Certificate of Title No. 21761 of the Registry of Deeds
ofMakati with respect to the civil status of Juan Luces
Luna should be changed from "JUAN LUCES LUNA
married to Soledad L. Luna" to "JUAN LUCES LUNA
married to Eugenia Zaballero Luna";
(c) Defendants-appellants, the heirs of Juan Luces
Luna and Eugenia Zaballero-Luna(first marriage) are
hereby declared to be the owner of the books Corpus
Juris, Fletcher on Corporation, American
Jurisprudence and Federal Supreme Court Reports
found in the condominium unit.
No pronouncement as to costs.
SO ORDERED.11
On March 13, 2006,12 the CA denied the petitioner’s
motion for reconsideration.13
Issues
In this appeal, the petitioner avers in her petition for
review on certiorarithat:
A. The Honorable Court of Appeals erred in ruling that
the Agreement for Separation and Property Settlement
executed by Luna and Respondent Eugenia was
unenforceable; hence, their conjugal partnership was
not dissolved and liquidated;
B. The Honorable Court of Appeals erred in not
recognizing the Dominican Republic court’s approval of
the Agreement;
C. The Honorable Court of Appeals erred in ruling that
Petitioner failed to adduce sufficient proof of actual
contribution to the acquisition of purchase of the
subjectcondominium unit; and
D. The Honorable Court of Appeals erred in ruling that
Petitioner was not entitled to the subject law books.14
The decisive question to be resolved is who among the
contending parties should be entitled to the 25/100 pro
indivisoshare in the condominium unit; and to the law
books (i.e., Corpus Juris, Fletcher on Corporation,
American Jurisprudence and Federal Supreme Court
Reports).
The resolution of the decisive question requires the
Court to ascertain the law that should determine, firstly,
whether the divorce between Atty. Luna and Eugenia
Zaballero-Luna (Eugenia) had validly dissolved the first
marriage; and, secondly, whether the second marriage
entered into by the late Atty. Luna and the petitioner
entitled the latter to any rights in property. Ruling of the
Court
We affirm the modified decision of the CA.
1. Atty. Luna’s first marriage with Eugenia subsisted up
to the time of his death
The first marriage between Atty. Luna and Eugenia,
both Filipinos, was solemnized in the Philippines on
September 10, 1947. The law in force at the time of the
solemnization was the Spanish Civil Code, which
adopted the nationality rule. The Civil Codecontinued
to follow the nationality rule, to the effect that Philippine
laws relating to family rights and duties, or to the status,
condition and legal capacity of persons were binding
upon citizens of the Philippines, although living
abroad.15 Pursuant to the nationality rule, Philippine
laws governed thiscase by virtue of bothAtty. Luna and
Eugenio having remained Filipinos until the death of
Atty. Luna on July 12, 1997 terminated their marriage.
From the time of the celebration ofthe first marriage on
September 10, 1947 until the present, absolute divorce
between Filipino spouses has not been recognized in
the Philippines. The non-recognition of absolute
divorce between Filipinos has remained even under
the Family Code,16 even if either or both of the spouses
are residing abroad.17 Indeed, the only two types of
defective marital unions under our laws have beenthe
void and the voidable marriages. As such, the
remedies against such defective marriages have been
limited to the declaration of nullity ofthe marriage and
the annulment of the marriage.
It is true that on January 12, 1976, the Court of First
Instance (CFI) of Sto. Domingo in the Dominican
Republic issued the Divorce Decree dissolving the first
marriage of Atty. Luna and Eugenia.18 Conformably
with the nationality rule, however, the divorce, even if
voluntarily obtained abroad, did not dissolve the
marriage between Atty. Luna and Eugenia, which
subsisted up to the time of his death on July 12, 1997.
This finding conforms to the Constitution, which
characterizes marriage as an inviolable social
institution,19 and regards it as a special contract of
permanent union between a man and a woman for the
establishment of a conjugal and family life.20 The non-
recognition of absolute divorce in the Philippines is a
manifestation of the respect for the sanctity of the
marital union especially among Filipino citizens. It
affirms that the extinguishment of a valid marriage
must be grounded only upon the death of either
75
spouse, or upon a ground expressly provided bylaw.
For as long as this public policy on marriage between
Filipinos exists, no divorce decree dissolving the
marriage between them can ever be given legal or
judicial recognition and enforcement in this jurisdiction.
2. The Agreement for Separation and Property
Settlement was void for lack of court approval
The petitioner insists that the Agreement for
Separation and Property Settlement (Agreement) that
the late Atty. Luna and Eugenia had entered into and
executed in connection with the divorce proceedings
before the CFI of Sto. Domingo in the Dominican
Republic to dissolve and liquidate their conjugal
partnership was enforceable against Eugenia. Hence,
the CA committed reversible error in decreeing
otherwise.
The insistence of the petitioner was unwarranted.
Considering that Atty. Luna and Eugenia had not
entered into any marriage settlement prior to their
marriage on September 10, 1947, the system of
relative community or conjugal partnership of gains
governed their property relations. This is because the
Spanish Civil Code, the law then in force at the time of
their marriage, did not specify the property regime of
the spouses in the event that they had not entered into
any marriage settlement before or at the time of the
marriage. Article 119 of the Civil Codeclearly so
provides, to wit:
Article 119. The future spouses may in the marriage
settlements agree upon absolute or relative community
of property, or upon complete separation of property,
or upon any other regime. In the absence of marriage
settlements, or when the same are void, the system of
relative community or conjugal partnership of gains as
established in this Code, shall govern the property
relations between husband and wife.
Article 142 of the Civil Codehas defined a conjugal
partnership of gains thusly:
Article 142. By means of the conjugal partnership of
gains the husband and wife place in a common fund
the fruits of their separate property and the income
from their work or industry, and divide equally, upon the
dissolution of the marriage or of the partnership, the net
gains or benefits obtained indiscriminately by either
spouse during the marriage.
The conjugal partnership of gains subsists until
terminated for any of various causes of termination
enumerated in Article 175 of the Civil Code, viz:
Article 175. The conjugal partnership of gains
terminates:
(1) Upon the death of either spouse;
(2) When there is a decree of legal separation;
(3) When the marriage is annulled;
(4) In case of judicial separation of property under
Article 191.
The mere execution of the Agreement by Atty. Luna
and Eugenia did not per sedissolve and liquidate their
conjugal partnership of gains. The approval of the
Agreement by a competent court was still required
under Article 190 and Article 191 of the Civil Code, as
follows:
Article 190. In the absence of an express declaration in
the marriage settlements, the separation of property
between spouses during the marriage shall not take
place save in virtue of a judicial order. (1432a)
Article 191. The husband or the wife may ask for the
separation of property, and it shall be decreed when
the spouse of the petitioner has been sentenced to a
penalty which carries with it civil interdiction, or has
been declared absent, or when legal separation has
been granted.
xxxx
The husband and the wife may agree upon the
dissolution of the conjugal partnership during the
marriage, subject to judicial approval. All the creditors
of the husband and of the wife, as well as of the
conjugal partnership shall be notified of any petition for
judicialapproval or the voluntary dissolution of the
conjugal partnership, so that any such creditors may
appear atthe hearing to safeguard his interests. Upon
approval of the petition for dissolution of the conjugal
partnership, the court shall take such measures as may
protect the creditors and other third persons.
After dissolution of the conjugal partnership, the
provisions of articles 214 and 215 shall apply. The
provisions of this Code concerning the effect of
partition stated in articles 498 to 501 shall be
applicable. (1433a)
But was not the approval of the Agreement by the CFI
of Sto. Domingo in the Dominican Republic sufficient in
dissolving and liquidating the conjugal partnership of
gains between the late Atty. Luna and Eugenia?
The query is answered in the negative. There is no
question that the approval took place only as an
incident ofthe action for divorce instituted by Atty. Luna
and Eugenia, for, indeed, the justifications for their
execution of the Agreement were identical to the
grounds raised in the action for divorce. 21 With the
divorce not being itself valid and enforceable under
Philippine law for being contrary to Philippine public
policy and public law, the approval of the Agreement
was not also legally valid and enforceable under
Philippine law. Consequently, the conjugal partnership
of gains of Atty. Luna and Eugenia subsisted in the
lifetime of their marriage.
3. Atty. Luna’s marriage with Soledad, being bigamous,
was void; properties acquired during their marriage
were governed by the rules on co-ownership
What law governed the property relations of the second
marriage between Atty. Luna and Soledad?
The CA expressly declared that Atty. Luna’s
subsequent marriage to Soledad on January 12, 1976
was void for being bigamous,22 on the ground that the
marriage between Atty. Luna and Eugenia had not
been dissolved by the Divorce Decree rendered by the
CFI of Sto. Domingo in the Dominican Republic but had
subsisted until the death of Atty. Luna on July 12, 1997.
The Court concurs with the CA.
In the Philippines, marriages that are bigamous,
polygamous, or incestuous are void. Article 71 of the
Civil Codeclearly states:
Article 71. All marriages performed outside the
Philippines in accordance with the laws in force in the
country where they were performed, and valid there as
such, shall also be valid in this country, except
76
bigamous, polygamous, or incestuous marriages as
determined by Philippine law.
Bigamy is an illegal marriage committed by contracting
a second or subsequent marriage before the first
marriage has been legally dissolved, or before the
absent spouse has been declared presumptively dead
by means of a judgment rendered in the proper
proceedings.23 A bigamous marriage is considered
void ab initio.24
Due to the second marriage between Atty. Luna and
the petitioner being void ab initioby virtue of its being
bigamous, the properties acquired during the
bigamous marriage were governed by the rules on co-
ownership, conformably with Article 144 of the Civil
Code, viz:
Article 144. When a man and a woman live together as
husband and wife, but they are not married, ortheir
marriage is void from the beginning, the property
acquired by eitheror both of them through their work or
industry or their wages and salaries shall be governed
by the rules on co-ownership.(n)
In such a situation, whoever alleges co-ownership
carried the burden of proof to confirm such
fact.1âwphi1 To establish co-ownership, therefore, it
became imperative for the petitioner to offer proof of
her actual contributions in the acquisition of property.
Her mere allegation of co-ownership, without sufficient
and competent evidence, would warrant no relief in her
favor. As the Court explained in Saguid v. Court of
Appeals:25
In the cases of Agapay v. Palang, and Tumlos v.
Fernandez, which involved the issue of co-ownership
ofproperties acquired by the parties to a bigamous
marriage and an adulterous relationship, respectively,
we ruled that proof of actual contribution in the
acquisition of the property is essential. The claim of co-
ownership of the petitioners therein who were parties
to the bigamous and adulterousunion is without basis
because they failed to substantiate their allegation that
they contributed money in the purchase of the disputed
properties. Also in Adriano v. Court of Appeals, we
ruled that the fact that the controverted property was
titled in the name of the parties to an adulterous
relationship is not sufficient proof of coownership
absent evidence of actual contribution in the
acquisition of the property.
As in other civil cases, the burden of proof rests upon
the party who, as determined by the pleadings or the
nature of the case, asserts an affirmative issue.
Contentions must be proved by competent evidence
and reliance must be had on the strength of the party’s
own evidence and not upon the weakness of the
opponent’s defense. This applies with more vigor
where, as in the instant case, the plaintiff was allowed
to present evidence ex parte.1âwphi1 The plaintiff is
not automatically entitled to the relief prayed for. The
law gives the defendantsome measure of protection as
the plaintiff must still prove the allegations in the
complaint. Favorable relief can be granted only after
the court isconvinced that the facts proven by the
plaintiff warrant such relief. Indeed, the party alleging a
fact has the burden of proving it and a mereallegation
is not evidence.26
The petitioner asserts herein that she sufficiently
proved her actual contributions in the purchase of the
condominium unit in the aggregate amount of at
least P306,572.00, consisting in direct contributions
ofP159,072.00, and in repaying the loans Atty. Luna
had obtained from Premex Financing and Banco
Filipino totaling P146,825.30;27 and that such
aggregate contributions of P306,572.00 corresponded
to almost the entire share of Atty. Luna in the purchase
of the condominium unit amounting to P362,264.00 of
the unit’s purchase price of P1,449,056.00.28 The
petitioner further asserts that the lawbooks were paid
for solely out of her personal funds, proof of which Atty.
Luna had even sent her a "thank you" note;29 that she
had the financial capacity to make the contributions
and purchases; and that Atty. Luna could not acquire
the properties on his own due to the meagerness of the
income derived from his law practice.
Did the petitioner discharge her burden of proof on the
co-ownership?
In resolving the question, the CA entirely debunked the
petitioner’s assertions on her actual contributions
through the following findings and conclusions,
namely:
SOLEDAD was not able to prove by preponderance of
evidence that her own independent funds were used to
buy the law office condominium and the law books
subject matter in contentionin this case – proof that was
required for Article 144 of the New Civil Code and
Article 148 of the Family Code to apply – as to cases
where properties were acquired by a man and a
woman living together as husband and wife but not
married, or under a marriage which was void ab initio.
Under Article 144 of the New Civil Code, the rules on
co-ownership would govern. But this was not readily
applicable to many situations and thus it created a void
at first because it applied only if the parties were not in
any way incapacitated or were without impediment to
marry each other (for it would be absurd to create a co-
ownership where there still exists a prior conjugal
partnership or absolute community between the man
and his lawful wife). This void was filled upon adoption
of the Family Code. Article 148 provided that: only the
property acquired by both of the parties through their
actual joint contribution of money, property or industry
shall be owned in common and in proportion to their
respective contributions. Such contributions and
corresponding shares were prima faciepresumed to be
equal. However, for this presumption to arise, proof of
actual contribution was required. The same rule and
presumption was to apply to joint deposits of money
and evidence of credit. If one of the parties was validly
married to another, his or her share in the co-ownership
accrued to the absolute community or conjugal
partnership existing in such valid marriage. If the party
who acted in bad faith was not validly married to
another, his or her share shall be forfeited in the
manner provided in the last paragraph of the Article
147. The rules on forfeiture applied even if both parties
were in bad faith. Co-ownership was the exception
while conjugal partnership of gains was the strict rule
whereby marriage was an inviolable social institution
and divorce decrees are not recognized in the
Philippines, as was held by the Supreme Court in the
case of Tenchavez vs. Escaño, G.R. No. L-19671,
November 29, 1965, 15 SCRA 355, thus:
xxxx
As to the 25/100pro-indivisoshare of ATTY. LUNA in
the condominium unit, SOLEDAD failed to prove that
she made an actual contribution to purchase the said
property. She failed to establish that the four (4) checks
that she presented were indeed used for the
acquisition of the share of ATTY. LUNA in the
77
condominium unit. This was aptly explained in the the law firm or in the purchase of books for the law firm. CERTIFICATION
Decision of the trial court, viz.: SOLEDAD failed to prove that she had anything to
contribute and that she actually purchased or paid for Pursuant to Section 13, Article VIII of the Constitution,
"x x x The first check, Exhibit "M" for P55,000.00 the law office amortization and for the law books. It is I certify that the conclusions in the above Decision
payable to Atty. Teresita Cruz Sison was issued on more logical to presume that it was ATTY. LUNA who had been reached in consultation before the case was
January 27, 1977, which was thirteen (13) months bought the law office space and the law books from his assigned to the writer of the opinion of the Court's
before the Memorandum of Agreement, Exhibit "7" was earnings from his practice of law rather than Division.
signed. Another check issued on April 29, 1978 in the embarrassingly beg or ask from SOLEDAD money for
amount of P97,588.89, Exhibit "P" was payable to MARIA LOURDES P. A. SERENO
use of the law firm that he headed.30
Banco Filipino. According to the plaintiff, thiswas in Chief Justice
payment of the loan of Atty. Luna. The third check The Court upholds the foregoing findings and
which was for P49,236.00 payable to PREMEX was conclusions by the CA both because they were
dated May 19, 1979, also for payment of the loan of substantiated by the records and because we have not
Atty. Luna. The fourth check, Exhibit "M", forP4,072.00 been shown any reason to revisit and undo them. Footnotes
was dated December 17, 1980. None of the foregoing Indeed, the petitioner, as the party claiming the co-
prove that the amounts delivered by plaintiff to the ownership, did not discharge her burden of proof. Her 1Rollo, pp. 34-51; penned by Associate Justice
payees were for the acquisition of the subject mere allegations on her contributions, not being Vicente Q. Roxas, with Associate Justice Conrado M.
condominium unit. The connection was simply not evidence,31 did not serve the purpose. In contrast, Vasquez, Jr. (later Presiding Justice) and Associate
established. x x x" given the subsistence of the first marriage between Justice Juan Q. Enriquez, Jr. concurring.
Atty. Luna and Eugenia, the presumption that Atty.
SOLEDAD’s claim that she made a cash contribution Luna acquired the properties out of his own personal 2 Id. at 198-210.
of P100,000.00 is unsubstantiated. Clearly, there is no funds and effort remained. It should then be justly 3
basis for SOLEDAD’s claim of co-ownership over the concluded that the properties in litislegally pertained to Id. at 37-39.
25/100 portion of the condominium unit and the trial their conjugal partnership of gains as of the time of his 4
court correctly found that the same was acquired Id. at 198-210.
death. Consequently, the sole ownership of the 25/100
through the sole industry of ATTY. LUNA, thus: pro indivisoshare of Atty. Luna in the condominium 5 Id. at 210.
unit, and of the lawbooks pertained to the respondents
"The Deed of Absolute Sale, Exhibit "9", covering the 6 Id. at 211-214.
as the lawful heirs of Atty. Luna.
condominium unit was in the name of Atty. Luna,
together with his partners in the law firm. The name of WHEREFORE, the Court AFFIRMS the decision 7 Id. at 217-219.
the plaintiff does not appear as vendee or as the promulgated on November 11, 2005; and ORDERS the 8 Id. at 283.
spouse of Atty. Luna. The same was acquired for the petitioner to pay the costs of suit.
use of the Law firm of Atty. Luna. The loans from Allied 9
Banking Corporation and Far East Bank and Trust SO ORDERED. Supra note 1.
Company were loans of Atty. Luna and his partners 10
LUCAS P. BERSAMIN Rollo, p. 44.
and plaintiff does not have evidence to show that she
paid for them fully or partially. x x x" Associate Justice 11 Id. at 50-51.
The fact that CCT No. 4779 and subsequently, CCT WE CONCUR: 12 Id. at 52-53.
No. 21761 were in the name of "JUAN LUCES LUNA,
MARIA LOURDES P. A. SERENO 13
married to Soledad L. Luna" was no proof that Id. at 54-65.
Chief Justice
SOLEDAD was a co-owner of the condominium unit.
14
Acquisition of title and registration thereof are two Id. at 17.
TERESITA J.
different acts. It is well settled that registration does not MARTIN S.
LEONARDO-DE 15Article 15, Civil Code, which is a revision of Article
confer title but merely confirms one already existing. VILLARAMA, JR.
CASTRO 9.1, Spanish Civil Code, states:
The phrase "married to" preceding "Soledad L. Luna" Associate Justice
Associate Justice
is merely descriptive of the civil status of ATTY. LUNA. Article 15. Laws relating to family rights and duties, or
BIENVENIDO L. REYES to the status, condition and legal capacity of persons
SOLEDAD, the second wife, was not even a lawyer. So
Associate Justice are binding upon citizens of the Philippines, even
it is but logical that SOLEDAD had no participation in
though living abroad. (9a)
78
16 31
In Corpuz v. Sto. Tomas(G.R. No. 186571, August Atienza v. De Castro, G.R. No. 169698, November
11, 2010, 628 SCRA 266, 277), the Court declares: 29, 2006, 508 SCRA 593, 602.

The Family Code recognizes only two types of

defective marriages – void and voidable marriages. In
both cases, the basis for the judicial declaration of
absolute nullity or annulment of the marriage exists
before or at the time of the marriage. Divorce, on the
other hand, contemplates the dissolution of the lawful
union for cause arising after the marriage. Our family
laws do not recognize absolute divorce between
Filipino citizens.
17Garcia v. Recio, G.R. No. 138322, October 2, 2001,
366 SCRA 437, 446.
18 Rollo,p. 37.
19 Article XV, Section 2, 1987 Constitution.
20 Article 1, Family Code.
21 Id. at 74, 81-82.
22 Id. at 48.
23Article 83, Civil Code; Sermonia v. Court of Appeals,
G.R. No.109454, June 14, 1994, 233 SCRA 155, 158.
24 The Civil Coderelevantly states:

Article 80. The following marriages shall be void from

the beginning:

xxxx

(4) Bigamous or polygamous marriages not falling

under Article 83, number 2;

xxxx
25 G.R. No. 150611, June 10, 2003, 403 SCRA 678.
26 Id. at 686-687.
27 Rollo, pp. 23-24.
28 Id. at 25.
29 Id. at 27.
30 Id. at 45-50.

79
 DAVID A. NOVERAS, Petitioner, A parcel of land with an area of 175 P175,000.00
vs. sq.m. located at Sabang Baler, Aurora
LETICIA T. NOVERAS, Respondent.

DECISION 3-has. coconut plantation in San Joaquin P750,000.00

Maria Aurora, Aurora
PEREZ, J.:

Before the Court is a petition for review assailing the 9

May 2008 Decision1 of the Court of Appeals in CA-G.R
USA
.. CV No. 88686, which affirmed in part the 8 December
2006 Decision2 of the Regional Trial Court (RTC) of
Baler, Aurora, Branch 96. PROPERTY FAIR MARKET VALUE

The factual antecedents are as follow:

House and Lot at 1155 Hanover Street, $550,000.00
David A. Noveras (David) and Leticia T. Noveras Daly City, California (unpaid debt of $285,000.00)
(Leticia) were married on 3 December 1988 in Quezon
City, Philippines. They resided in California, United
Furniture and furnishings $3,000
States of America (USA) where they eventually
acquired American citizenship. They then begot two
children, namely: Jerome T. Jewelries (ring and watch) $9,000

Noveras, who was born on 4 November 1990 and

JenaT. Noveras, born on 2 May 1993. David was 2000 Nissan Frontier 4x4 pickup truck $13,770.00
engaged in courier service business while Leticia
worked as a nurse in San Francisco, California. Bank of America Checking Account $8,000
During the marriage, they acquired the following
properties in the Philippines and in the USA: Bank of America Cash Deposit

PHILIPPINES
Life Insurance (Cash Value) $100,000.00

PROPERTY FAIR MARKET VALUE

House and Lot with an area of 150 sq.
m. located at 1085 Norma Street,
Sampaloc, Manila (Sampaloc property)
Agricultural land with an area of 20,742
sq. m. located at Laboy, Dipaculao,
Republic of the Philippines Aurora
SUPREME COURT
Manila A parcel of land with an area of 2.5
hectares located at Maria Aurora, Aurora
SECOND DIVISION
G.R. No. 188289 August 20, 2014
Retirement, pension, profit-sharing, $56,228.00
annuities
P1,693,125.00
The Sampaloc property used to beowned by David’s
parents. The parties herein secured a loan from a bank
and mortgaged the property. When said property was
P400,000.00 about to be foreclosed, the couple paid a total of P1.5
Million for the redemption of the same.
Due to business reverses, David left the USA and
returned to the Philippines in 2001. In December
P490,000.00 2002,Leticia executed a Special Power of Attorney
(SPA) authorizing David to sell the Sampaloc property
for P2.2 Million. According to Leticia, sometime in
September 2003, David abandoned his family and
lived with Estrellita Martinez in Aurora province. Leticia
claimed that David agreed toand executed a Joint
80
Affidavit with Leticia in the presence of David’s father,
Atty. Isaias Noveras, on 3 December 2003 stating that:
1) the P1.1Million proceeds from the sale of the
Sampaloc property shall be paid to and collected by
Leticia; 2) that David shall return and pay to
LeticiaP750,000.00, which is equivalent to half of the
amount of the redemption price of the Sampaloc
property; and 3) that David shall renounce and forfeit
all his rights and interest in the conjugal and real
properties situated in the Philippines.5 David was able
to collect P1,790,000.00 from the sale of the Sampaloc
property, leaving an unpaid balance of P410,000.00.
Upon learning that David had an extra-marital affair,
Leticia filed a petition for divorce with the Superior
Court of California, County of San Mateo, USA. The
California court granted the divorce on 24 June 2005
and judgment was duly entered on 29 June 2005.6 The
California court granted to Leticia the custody of her
two children, as well as all the couple’s properties in
the USA.7
On 8 August 2005, Leticia filed a petition for Judicial
Separation of Conjugal Property before the RTC of
Baler, Aurora. She relied on the 3 December 2003
Joint Affidavit and David’s failure to comply with his
obligation under the same. She prayed for: 1) the
power to administer all conjugal properties in the
Philippines; 2) David and his partner to cease and
desist from selling the subject conjugal properties; 3)
the declaration that all conjugal properties be forfeited
in favor of her children; 4) David to remit half of the
purchase price as share of Leticia from the sale of the
Sampaloc property; and 5) the payment ofP50,000.00
and P100,000.00 litigation expenses.8
In his Answer, David stated that a judgment for the
dissolution of their marriage was entered on 29 June
2005 by the Superior Court of California, County of San
Mateo. He demanded that the conjugal partnership
properties, which also include the USA properties, be
liquidated and that all expenses of liquidation, including
attorney’s fees of both parties be charged against the
conjugal partnership.9
The RTC of Baler, Aurora simplified the issues as
follow:
1. Whether or not respondent David A. Noveras
committed acts of abandonment and marital infidelity
which can result intothe forfeiture of the parties’
properties in favor of the petitioner and their two (2)
children.
2. Whether or not the Court has jurisdiction over the
properties in California, U.S.A. and the same can be
included in the judicial separation prayed for.
3. Whether or not the "Joint Affidavit" x x x executed by
petitioner Leticia T. Noveras and respondent David A.
Noveras will amount to a waiver or forfeiture of the
latter’s property rights over their conjugal properties.
4. Whether or not Leticia T. Noveras isentitled to
reimbursement of onehalf of the P2.2 [M]illion sales
proceeds of their property in Sampaloc, Manila and
one-half of the P1.5 [M]illion used to redeem the
property of Atty. Isaias Noveras, including interests and
charges.
5. How the absolute community properties should be
distributed.
6. Whether or not the attorney’s feesand litigation
expenses of the parties were chargeable against their
conjugal properties.
Corollary to the aboveis the issue of:
Whether or not the two common children of the parties
are entitled to support and presumptive legitimes.10
On 8 December 2006, the RTC rendered judgment as
follows:
1. The absolute community of property of the parties is
hereby declared DISSOLVED;
2. The net assets of the absolute community of
property ofthe parties in the Philippines are hereby
ordered to be awarded to respondent David A. Noveras
only, with the properties in the United States of America
remaining in the sole ownership of petitioner Leticia
Noveras a.k.a. Leticia Tacbiana pursuant to the divorce
decree issuedby the Superior Court of California,
County of San Mateo, United States of America,
dissolving the marriage of the parties as of June 24,
2005. The titles presently covering said properties shall
be cancelled and new titles be issued in the name of
the party to whom said properties are awarded;
3. One-half of the properties awarded to respondent
David A. Noveras in the preceding paragraph are
hereby given to Jerome and Jena, his two minor
children with petitioner LeticiaNoveras a.k.a. Leticia
Tacbiana as their presumptive legitimes and said
legitimes must be annotated on the titles covering the
said properties.Their share in the income from these
properties shall be remitted to them annually by the
respondent within the first half of January of each year,
starting January 2008;
4. One-half of the properties in the United States of
America awarded to petitioner Leticia Noveras a.k.a.
Leticia Tacbiana in paragraph 2 are hereby given to
Jerome and Jena, her two minor children with
respondent David A. Noveras as their presumptive
legitimes and said legitimes must be annotated on the
titles/documents covering the said properties. Their
share in the income from these properties, if any, shall
be remitted to them annually by the petitioner within the
first half of January of each year, starting January
2008;
5. For the support of their two (2) minor children,
Jerome and Jena, respondent David A. Noveras shall
give them US$100.00 as monthly allowance in addition
to their income from their presumptive legitimes, while
petitioner Leticia Tacbiana shall take care of their food,
clothing, education and other needs while they are in
her custody in the USA. The monthly allowance due
from the respondent shall be increased in the future as
the needs of the children require and his financial
capacity can afford;
6. Of the unpaid amount of P410,000.00 on the
purchase price of the Sampaloc property, the Paringit
Spouses are hereby ordered to pay P5,000.00 to
respondent David A. Noveras and P405,000.00 to the
two children. The share of the respondent may be paid
to him directly but the share of the two children shall be
deposited with a local bank in Baler, Aurora, in a joint
account tobe taken out in their names, withdrawal from
which shall only be made by them or by their
representative duly authorized with a Special Power of
Attorney. Such payment/deposit shall be made
withinthe period of thirty (30) days after receipt of a
copy of this Decision, with the passbook of the joint
account to be submitted to the custody of the Clerk of
Court of this Court within the same period. Said
81
passbook can be withdrawn from the Clerk of Court
only by the children or their attorney-in-fact; and
7. The litigation expenses and attorney’s fees incurred
by the parties shall be shouldered by them
individually.11
The trial court recognized that since the parties are US
citizens, the laws that cover their legal and
personalstatus are those of the USA. With respect to
their marriage, the parties are divorced by virtue of the
decree of dissolution of their marriage issued by the
Superior Court of California, County of San Mateo on
24June 2005. Under their law, the parties’ marriage
had already been dissolved. Thus, the trial court
considered the petition filed by Leticia as one for
liquidation of the absolute community of property
regime with the determination of the legitimes, support
and custody of the children, instead of an action for
judicial separation of conjugal property.
With respect to their property relations, the trial court
first classified their property regime as absolute
community of property because they did not execute
any marriage settlement before the solemnization of
their marriage pursuant to Article 75 of the Family
Code. Then, the trial court ruled that in accordance with
the doctrine of processual presumption, Philippine law
should apply because the court cannot take judicial
notice of the US law since the parties did not submit
any proof of their national law. The trial court held that
as the instant petition does not fall under the provisions
of the law for the grant of judicial separation of
properties, the absolute community properties cannot
beforfeited in favor of Leticia and her children.
Moreover, the trial court observed that Leticia failed to
prove abandonment and infidelity with preponderant
evidence.
The trial court however ruled that Leticia is not entitled
to the reimbursements she is praying for considering
that she already acquired all of the properties in the
USA. Relying still on the principle of equity, the Court
also adjudicated the Philippine properties to David,
subject to the payment of the children’s presumptive
legitimes. The trial court held that under Article 89 of
the Family Code, the waiver or renunciation made by
David of his property rights in the Joint Affidavit is void.
On appeal, the Court of Appeals modified the trial
court’s Decision by directing the equal division of the
Philippine properties between the spouses. Moreover
with respect to the common children’s presumptive
legitime, the appellate court ordered both spouses to
each pay their children the amount of P520,000.00,
thus:
WHEREFORE, the instant appeal is PARTLY
GRANTED. Numbers 2, 4 and 6 of the
assailedDecision dated December 8, 2006 of Branch
96, RTC of Baler, Aurora Province, in Civil Case No.
828 are hereby MODIFIED to read as follows:
2. The net assets of the absolute community of
property of the parties in the Philippines are hereby
divided equally between petitioner Leticia Noveras
a.k.a. Leticia Tacbiana (sic) and respondent David A.
Noveras;
xxx
4. One-half of the properties awarded to petitioner
Leticia Tacbiana (sic) in paragraph 2 shall pertain to
her minor children, Jerome and Jena, as their
presumptive legitimes which shall be annotated on the
titles/documents covering the said properties. Their
share in the income therefrom, if any, shall be remitted
to them by petitioner annually within the first half of
January, starting 2008;
xxx
6. Respondent David A. Noveras and petitioner Leticia
Tacbiana (sic) are each ordered to pay the amount
ofP520,000.00 to their two children, Jerome and Jena,
as their presumptive legitimes from the sale of the
Sampaloc property inclusive of the receivables
therefrom, which shall be deposited to a local bank of
Baler, Aurora, under a joint account in the latter’s
names. The payment/deposit shall be made within a
period of thirty (30) days from receipt ofa copy of this
Decision and the corresponding passbook entrusted to
the custody ofthe Clerk of Court a quowithin the same
period, withdrawable only by the children or their
attorney-in-fact.
A number 8 is hereby added, which shall read as
follows:
8. Respondent David A. Noveras is hereby ordered to
pay petitioner Leticia Tacbiana (sic) the amount
ofP1,040,000.00 representing her share in the
proceeds from the sale of the Sampaloc property.
The last paragraph shall read as follows:
Send a copy of this Decision to the local civil registry of
Baler, Aurora; the local civil registry of Quezon City; the
Civil RegistrarGeneral, National Statistics Office, Vibal
Building, Times Street corner EDSA, Quezon City; the
Office of the Registry of Deeds for the Province of
Aurora; and to the children, Jerome Noveras and Jena
Noveras.
The rest of the Decision is AFFIRMED.12
In the present petition, David insists that the Court of
Appeals should have recognized the California
Judgment which awarded the Philippine properties to
him because said judgment was part of the pleading
presented and offered in evidence before the trial
court. David argues that allowing Leticia to share in the
Philippine properties is tantamount to unjust
enrichment in favor of Leticia considering that the latter
was already granted all US properties by the California
court.
In summary and review, the basic facts are: David and
Leticia are US citizens who own properties in the USA
and in the Philippines. Leticia obtained a decree of
divorce from the Superior Court of California in June
2005 wherein the court awarded all the properties in
the USA to Leticia. With respect to their properties in
the Philippines, Leticiafiled a petition for judicial
separation ofconjugal properties.
At the outset, the trial court erred in recognizing the
divorce decree which severed the bond of marriage
between the parties. In Corpuz v. Sto. Tomas,13 we
stated that:
The starting point in any recognition of a foreign
divorce judgment is the acknowledgment that our
courts do not take judicial notice of foreign judgments
and laws. Justice Herrera explained that, as a rule, "no
sovereign is bound to give effect within its dominion to
a judgment rendered by a tribunal of another country."
This means that the foreign judgment and its
authenticity must beproven as facts under our rules on
evidence, together with the alien’s applicable national
82
law to show the effect of the judgment on the alien
himself or herself. The recognition may be made in an
action instituted specifically for the purpose or in
another action where a party invokes the foreign
decree as an integral aspect of his claim or defense.14
The requirements of presenting the foreign divorce
decree and the national law of the foreigner must
comply with our Rules of Evidence. Specifically, for
Philippine courts to recognize a foreign judgment
relating to the status of a marriage, a copy of the
foreign judgment may be admitted in evidence and
proven as a fact under Rule 132, Sections 24 and 25,
in relation to Rule 39, Section 48(b) of the Rules of
Court.15
Under Section 24 of Rule 132, the record of public
documents of a sovereign authority or tribunal may be
proved by: (1) an official publication thereof or (2) a
copy attested by the officer having the legal custody
thereof. Such official publication or copy must
beaccompanied, if the record is not kept in the
Philippines, with a certificate that the attesting officer
has the legal custody thereof. The certificate may be
issued by any of the authorized Philippine embassy or
consular officials stationed in the foreign country in
which the record is kept, and authenticated by the seal
of his office. The attestation must state, in substance,
that the copy is a correct copy of the original, or a
specific part thereof, asthe case may be, and must be
under the official seal of the attesting officer.
Section 25 of the same Rule states that whenever a
copy of a document or record is attested for the
purpose of evidence, the attestation must state, in
substance, that the copy is a correct copy of the
original, or a specific part thereof, as the case may be.
The attestation must be under the official seal of the
attesting officer, if there be any, or if hebe the clerk of
a court having a seal, under the seal of such court.
Based on the records, only the divorce decree was
presented in evidence. The required certificates to
prove its authenticity, as well as the pertinent California
law on divorce were not presented.
It may be noted that in Bayot v. Court of Appeals,16 we
relaxed the requirement on certification where we held
that "[petitioner therein] was clearly an American
citizenwhen she secured the divorce and that divorce
is recognized and allowed in any of the States of the
Union, the presentation of a copy of foreign divorce
decree duly authenticatedby the foreign court issuing
said decree is, as here, sufficient." In this case
however, it appears that there is no seal from the office
where the divorce decree was obtained.
Even if we apply the doctrine of processual
presumption17 as the lower courts did with respect to
the property regime of the parties, the recognition of
divorce is entirely a different matter because, to begin
with, divorce is not recognized between Filipino
citizens in the Philippines. Absent a valid recognition of
the divorce decree, it follows that the parties are still
legally married in the Philippines. The trial court thus
erred in proceeding directly to liquidation.
As a general rule, any modification in the marriage
settlements must be made before the celebration of
marriage. An exception to this rule is allowed provided
that the modification isjudicially approved and refers
only to the instances provided in Articles 66,67, 128,
135 and 136 of the Family Code.18
Leticia anchored the filing of the instant petition for
judicial separation of property on paragraphs 4 and 6
of Article 135 of the Family Code, to wit:
Art. 135. Any of the following shall be considered
sufficient cause for judicial separation of property:
(1) That the spouse of the petitioner has been
sentenced to a penalty which carries with it civil
interdiction;
(2) That the spouse of the petitioner has been judicially
declared an absentee;
(3) That loss of parental authority ofthe spouse of
petitioner has been decreed by the court;
(4) That the spouse of the petitioner has abandoned
the latter or failed to comply with his or her obligations
to the family as provided for in Article 101;
(5) That the spouse granted the power of
administration in the marriage settlements has abused
that power; and
(6) That at the time of the petition, the spouses have
been separated in fact for at least one year and
reconciliation is highly improbable.
In the cases provided for in Numbers (1), (2), and (3),
the presentation of the final judgment against the
guiltyor absent spouse shall be enough basis for the
grant of the decree ofjudicial separation of property.
(Emphasis supplied).
The trial court had categorically ruled that there was no
abandonment in this case to necessitate judicial
separation of properties under paragraph 4 of Article
135 of the Family Code. The trial court ratiocinated:
Moreover, abandonment, under Article 101 of the
Family Code quoted above, must be for a valid cause
and the spouse is deemed to have abandoned the
other when he/she has left the conjugal dwelling
without intention of returning. The intention of not
returning is prima facie presumed if the allegedly [sic]
abandoning spouse failed to give any information as to
his or her whereabouts within the period of three
months from such abandonment.
In the instant case, the petitioner knows that the
respondent has returned to and stayed at his
hometown in Maria Aurora, Philippines, as she even
went several times to visit him there after the alleged
abandonment. Also, the respondent has been going
back to the USA to visit her and their children until the
relations between them worsened. The last visit of said
respondent was in October 2004 when he and the
petitioner discussed the filing by the latter of a petition
for dissolution of marriage with the California court.
Such turn for the worse of their relationship and the
filing of the saidpetition can also be considered as valid
causes for the respondent to stay in the Philippines.19
Separation in fact for one year as a ground to grant a
judicial separation of property was not tackled in the
trial court’s decision because, the trial court
erroneously treated the petition as liquidation of the
absolute community of properties.
The records of this case are replete with evidence that
Leticia and David had indeed separated for more than
a year and that reconciliation is highly improbable.
First, while actual abandonment had not been proven,
it is undisputed that the spouses had been living
83
separately since 2003 when David decided to go back
to the Philippines to set up his own business. Second,
Leticia heard from her friends that David has been
cohabiting with Estrellita Martinez, who represented
herself as Estrellita Noveras. Editha Apolonio, who
worked in the hospital where David was once confined,
testified that she saw the name of Estrellita listed as
the wife of David in the Consent for Operation
form.20 Third and more significantly, they had filed for
divorce and it was granted by the California court in
June 2005.
Having established that Leticia and David had actually
separated for at least one year, the petition for judicial
separation of absolute community of property should
be granted.
The grant of the judicial separation of the absolute
community property automatically dissolves the
absolute community regime, as stated in the 4th
paragraph of Article 99 ofthe Family Code, thus:
Art. 99. The absolute community terminates:
(1) Upon the death of either spouse;
(2) When there is a decree of legal separation;
(3) When the marriage is annulled or declared void; or
(4) In case of judicial separation of property during the
marriage under Articles 134 to 138. (Emphasis
supplied).
Under Article 102 of the same Code, liquidation follows
the dissolution of the absolute community regime and
the following procedure should apply:
Art. 102. Upon dissolution of the absolute community
regime, the following procedure shall apply:
(1) An inventory shall be prepared, listing separately all
the properties of the absolute community and the
exclusive properties of each spouse.
(2) The debts and obligations of the absolute
community shall be paid out of its assets. In case of
insufficiency of said assets, the spouses shall be
solidarily liable for the unpaid balance with their
separate properties in accordance with the provisions
of the second paragraph of Article 94.
(3) Whatever remains of the exclusive properties of the
spouses shall thereafter be delivered to each of them.
(4) The net remainder of the properties of the absolute
community shall constitute its net assets, which shall
be divided equally between husband and wife, unless
a different proportion or division was agreed upon in
the marriage settlements, or unless there has been a
voluntary waiver of such share provided in this Code.
For purposes of computing the net profits subject to
forfeiture in accordance with Articles 43, No. (2) and
63, No. (2),the said profits shall be the increase in value
between the market value of the community property at
the time of the celebration of the marriage and the
market value at the time of its dissolution.
(5) The presumptive legitimes of the common children
shall be delivered upon partition, in accordance with
Article 51.
(6) Unless otherwise agreed upon by the parties, in the
partition of the properties, the conjugal dwelling and the
lot on which it is situated shall be adjudicated tothe
spouse with whom the majority of the common children
choose to remain. Children below the age of seven
years are deemed to have chosen the mother, unless
the court has decided otherwise. In case there is no
such majority, the court shall decide, taking into
consideration the best interests of said children. At the
risk of being repetitious, we will not remand the case to
the trial court. Instead, we shall adopt the modifications
made by the Court of Appeals on the trial court’s
Decision with respect to liquidation.
We agree with the appellate court that the Philippine
courts did not acquire jurisdiction over the California
properties of David and Leticia. Indeed, Article 16 of
the Civil Code clearly states that real property as well
as personal property is subject to the law of the country
where it is situated. Thus, liquidation shall only be
limited to the Philippine properties.
We affirm the modification madeby the Court of
Appeals with respect to the share of the spouses in the
absolutecommunity properties in the Philippines, as
well as the payment of their children’s presumptive
legitimes, which the appellate court explained in this
wise:
Leticia and David shall likewise have an equal share in
the proceeds of the Sampaloc property.1âwphi1 While
both claimed to have contributed to the redemption of
the Noveras property, absent a clear showing where
their contributions came from, the same is presumed to
have come from the community property. Thus, Leticia
is not entitled to reimbursement of half of the
redemption money.
David's allegation that he used part of the proceeds
from the sale of the Sampaloc property for the benefit
of the absolute community cannot be given full
credence. Only the amount of P120,000.00 incurred in
going to and from the U.S.A. may be charged thereto.
Election expenses in the amount of P300,000.00 when
he ran as municipal councilor cannot be allowed in the
absence of receipts or at least the Statement of
Contributions and Expenditures required under
Section 14 of Republic Act No. 7166 duly received by
the Commission on Elections. Likewise, expenses
incurred to settle the criminal case of his personal
driver is not deductible as the same had not benefited
the family. In sum, Leticia and David shall share equally
in the proceeds of the sale net of the amount
of P120,000.00 or in the respective amounts
of P1,040,000.00.
xxxx
Under the first paragraph of Article 888 of the Civil
Code, "(t)he legitime of legitimate children and
descendants consists of one-half or the hereditary
estate of the father and of the mother." The children arc
therefore entitled to half of the share of each spouse in
the net assets of the absolute community, which shall
be annotated on the titles/documents covering the
same, as well as to their respective shares in the net
proceeds from the sale of the Sampaloc property
including the receivables from Sps. Paringit in the
amount of P410,000.00. Consequently, David and
Leticia should each pay them the amount
of P520,000.00 as their presumptive legitimes
therefrom.21
WHEREFORE, the petition is DENIED. The assailed
Decision of the Court of Appeals in CA G.R. CV No.
88686 is AFFIRMED.
SO ORDERED.
84
JOSE PORTUGAL PEREZ 3 Id. at 2.
Associate Justice
4 Id. at 27-28.
WE CONCUR:
5 Id. at 16.
MARIA LOURDES P. A. SERENO*
6
Chief Justice Id. at 77.
7
ANTONIO T. CARPIO PRESBITERO J. Id. at 79-81.
Associate Justice VELASCO, JR.** 8 Id. at 4-5.
Chairperson Associate Justice
9 Id. at 23-26.
MARIANO C. DEL CASTILLO
Associate Justice 10 Id. at 267.
ATTESTATION 11 Id. at 287-288.
I attest that the conclusions in the above Decision had 12 Rollo, pp. 36-37.
been reached in consultation before the case was
13
assigned to the writer of the opinion of the Court's G.R. No. 186571, 11 August 2010, 628 SCRA 266.
Division. 14 Id. at 281-282.
ANTONIO T. CARPIO
15
Associate Justice Fujiki v. Marinay, G.R. No. 196049, 26 June 2013.
Second Division Chairperson 16 591 Phil. 452, 470 (2008).
CERTIFICATION 17Processual presumption means that where a foreign
Pursuant to Section 13, Article VIII of the Constitution law is not pleaded or, even if pleaded, is not proved,
and the Division Chairperson's Attestation, I certify the presumption is that foreign law is the same as ours.
that the conclusions in the above Decision had been See EDI-Staffbuilders Int’l. Inc. v. NLRC, 563 Phil. 1,
reached in consultation before the case was assigned 22 (2007).
to the writer of the opinion of the Court's Division. 18Sta. Maria, Persons and Family Relations Law,
MARIA LOURDES P. A. SERENO Fourth Edition, 2004, p. 396.
Chief Justice 19 Records, p. 280.
20 TSN, 9 March 2006, p. 13.
21 Rollo, pp. 34-35.
Footnotes

* Per Raffle dated 28 July 2014.

** Per Special Order No. 1757 dated 20 August 2014.

1Penned by Associate Justice Estela M. Perlas-
Bernabe (now Supreme Court Associate Justice) with
Associate Justices Portia Aliflo-Hormachuelos and
Rosmari D. Carandang, concurring. Rollo, pp. 26-37.
2Presided by Judge Corazon D. Soluren. Records, pp.
262-288.
85

Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 205487 November 12, 2014
ORION SAVINGS BANK, Petitioner,
vs.
SHIGEKANE SUZUKI, Respondent.
DECISION
BRION, J.:
Before us is the Petition for Review on Certiorari1 filed
by petitioner Orion Savings Bank (Orion) under Rule
45 of the Rules of Court, assailing the decision 2 dated
August 23, 2012 and the resolution3 dated January 25,
2013 of the Court of Appeals (CA) in CA-G.R. CV No.
94104.
The Factual Antecedents
In the first week of August 2003, respondent
Shigekane Suzuki (Suzuki), a Japanese national, met
with Ms. Helen Soneja (Soneja) to inquire about a
condominium unit and a parking slot at Cityland
Pioneer, Mandaluyong City, allegedly owned by Yung
Sam Kang (Kang), a Korean national and a Special
Resident Retiree's Visa (SRRV) holder.
At the meeting, Soneja informed Suzuki that Unit No.
536 [covered by Condominium Certificate of Title
(CCT) No. 18186]4 and Parking Slot No. 42 [covered
by CCT No. 9118]5 were for sale for P3,000,000.00.
Soneja likewise assured Suzuki that the titles to the unit
and the parking slot were clean. After a brief
negotiation, the parties agreed to reduce the price
to P2,800,000.00. On August 5, 2003, Suzuki issued
Kang a Bank of the Philippine Island (BPI) Check No.
833496 for One Hundred Thousand Pesos
(P100,000.00) as reservation fee.7 On August 21,
2003, Suzuki issued Kang another check, BPI Check
No. 83350,8 this time for P2,700,000.00 representing
the remaining balance of the purchase price. Suzuki
and Kang then executed a Deed of Absolute Sale
dated August 26, 20039 covering Unit No. 536 and
Parking Slot No. 42. Soon after, Suzuki took
possession of the condominium unit and parking lot,
and commenced the renovation of the interior of the
condominium unit.
Kang thereafter made several representations with
Suzuki to deliver the titles to the properties, which were
then allegedly in possession of Alexander Perez
(Perez, Orion’s Loans Officer) for safekeeping. Despite
several verbal demands, Kang failed to deliver the
documents. Suzuki later on learned that Kang had left
the country, prompting Suzuki to verify the status of the
properties with the Mandaluyong City Registry of
Deeds.
Before long, Suzuki learned that CCT No. 9118
representing the title to the Parking Slot No. 42
contained no annotations although it remained under
the name of Cityland Pioneer. This notwithstanding,
Cityland Pioneer, through Assistant Vice President
Rosario D. Perez, certified that Kang had fully paid the
purchase price of Unit. No. 53610 and Parking Slot No.
42.11 CCT No. 18186 representing the title to the
condominium unit had no existing encumbrance,
except for anannotation under Entry No. 73321/C-
10186 which provided that any conveyance or
encumbrance of CCT No. 18186 shall be subject to
approval by the Philippine Retirement Authority (PRA).
Although CCT No. 18186 contained Entry No.
66432/C-10186 dated February 2, 1999 representing a
mortgage in favor of Orion for a P1,000,000.00 loan,
that annotation was subsequently cancelled on June
16, 2000 by Entry No. 73232/T. No. 10186. Despite the
cancellation of the mortgage to Orion, the titles to the
properties remained in possession of Perez.
To protect his interests, Suzuki thenexecuted an
Affidavit of Adverse Claim12 dated September 8, 2003,
withthe Registry of Deeds of Mandaluyong City,
annotated as Entry No. 3292/C-No. 18186 in CCT No.
18186. Suzuki then demanded the delivery of the
titles.13 Orion, (through Perez), however, refused to
86
surrender the titles, and cited the need to consult
Orion’s legal counsel as its reason.
On October 14, 2003, Suzuki received a letter from
Orion’s counsel dated October 9, 2003, stating that
Kang obtained another loan in the amount
of P1,800,000.00. When Kang failed to pay, he
executed a Dacion en Pagodated February 2, 2003, in
favorof Orion covering Unit No. 536. Orion, however,
did not register the Dacion en Pago, until October 15,
2003.
On October 28, 2003, Suzuki executed an Affidavit of
Adverse Claim over Parking Slot No. 42 (covered by
CCT No. 9118) and this was annotated as Entry No.
4712/C-No. 9118 in the parking lot’s title.
On January 27, 2004, Suzuki filed a complaint for
specific performance and damages against Kang and
Orion. At the pre-trial, the parties made the following
admissions and stipulations:
1. That as of August 26, 2003, Kang was the registered
owner of Unit No. 536 and Parking Slot No. 42;
2. That the mortgage in favor ofOrion supposedly
executed by Kang, with Entry No. 66432/C-10186
dated February 2, 1999, was subsequently cancelled
by Entry No. 73232/T No. 10186 dated June 16, 2000;
3. That the alleged Dacion en Pagowas never
annotated in CCT Nos. 18186 and 9118;
4. That Orion only paid the appropriate capital gains tax
and the documentary stamp tax for the alleged Dacion
en Pago on October 15, 2003;
5. That Parking Slot No. 42, covered by CCT No. 9118,
was never mortgaged to Orion; and
6. That when Suzuki bought the properties, he went to
Orion to obtain possession of the titles.
The RTC Ruling
14
In its decision dated June 29, 2009, the Regional
Trial Court (RTC), Branch 213, Mandaluyong City ruled
infavor of Suzuki and ordered Orion to deliver the CCT
Nos. 18186 and 9118 to Suzuki.
The court found that Suzuki was an innocent purchaser
for value whose rights over the properties prevailed
over Orion’s. The RTC further noted that Suzuki
exerted efforts to verify the status of the properties but
he did not find any existing encumbrance inthe titles.
Although Orion claims to have purchased the property
by way of a Dacion en Pago, Suzuki only learned about
it two (2) months after he bought the properties
because Orion never bothered to register or annotate
the Dacion en Pagoin CCT Nos. 18186 and 9116.
The RTC further ordered Orion and Kang to jointly and
severally pay Suzuki moral damages, exemplary
damages, attorney’s fees, appearance fees, expenses
for litigation and cost ofsuit. Orion timely appealed the
RTC decision with the CA.
The CA Ruling
On August 23, 2012, the CA partially granted Orion’s
appeal and sustained the RTC insofar as it upheld
Suzuki’s right over the properties. The CA further noted
that Entry No. 73321/C-10186 pertaining to the
withdrawal of investment of an SRRV only serves as a
warning to an SRRV holder about the implications of a
conveyance of a property investment. It deviated from
the RTC ruling, however, by deleting the award for
moral damages, exemplary damages, attorney’s fees,
expenses for litigation and cost of suit.
Orion sought a reconsideration of the CA decision but
the CA denied the motion in its January 25, 2013
resolution. Orion then filed a petition for review on
certiorariunder Rule 45 with this Court.
The Petition and Comment
Orion’s petition is based on the following
grounds/arguments:15
1. The Deed of Sale executed by Kang in favor of
Suzuki is null and void. Under Korean law, any
conveyance of a conjugal property should be made
with the consent of both spouses;
2. Suzuki is not a buyer in good faith for he failed to
check the owner’s duplicate copies of the CCTs;
3. Knowledge of the PRA restriction under Entry No.
73321/C-10186, which prohibits any conveyance or
encumbrance of the property investment, defeats the
alleged claim of good faith by Suzuki; and
4. Orion should not be faulted for exercising due
diligence.
In his Comment,16 Suzuki asserts that the issue on
spousal consent was belatedly raised on appeal.
Moreover, proof of acquisition during the marital
coverture is a condition sine qua nonfor the operation
of the presumption of conjugal ownership.17 Suzuki
additionally maintains that he is a purchaser in good
faith, and is thus entitled to the protection of the law.
The Court’s Ruling
We deny the petition for lack of merit.
The Court may inquire into conclusions of fact when
the inference made is manifestly mistaken
In a Rule 45 petition, the latitude of judicial review
generally excludes a factual and evidentiary re-
evaluation, and the Court ordinarily abides by the
uniform factual conclusions of the trial court and the
appellate court.18 In the present case, while the courts
below both arrived at the same conclusion, there
appears tobe an incongruence in their factual findings
and the legal principle they applied to the attendant
factual circumstances. Thus, we are compelled to
examine certain factual issues in the exercise of our
sound discretion to correct any mistaken inference that
may have been made.19
Philippine Law governs the transfer of real property
Orion believes that the CA erred in not ruling on the
issue of spousal consent. We cannot uphold this
position, however, because the issue of spousal
consent was only raised on appeal to the CA. It is a
well-settled principle that points of law, theories,
issues, and arguments not brought to the attention of
the trial court cannot be raised for the first time on
appeal and considered by a reviewing court. 20 To
consider these belated arguments would violate basic
principles of fairplay, justice, and due process.
Having said these, we shall nonetheless discuss the
issues Orion belatedly raised, if only to put an end to
lingering doubts on the correctness of the denial of the
present petition.
It is a universal principle thatreal or immovable property
is exclusively subject to the laws of the country or state
87
where it is located.21 The reason is found in the very
nature of immovable property — its immobility.
Immovables are part of the country and so closely
connected to it that all rights over them have their
natural center of gravity there.22
Thus, all matters concerning the titleand disposition
ofreal property are determined by what is known as the
lex loci rei sitae, which can alone prescribe the mode
by which a title canpass from one person to another, or
by which an interest therein can be gained or
lost.23 This general principle includes all rules
governing the descent, alienation and transfer of
immovable property and the validity, effect and
construction of wills and other conveyances.24
This principle even governs the capacity of the person
making a deed relating to immovable property, no
matter what its nature may be. Thus, an instrument will
be ineffective to transfer title to land if the person
making it is incapacitated by the lex loci rei sitae, even
though under the law of his domicile and by the law of
the place where the instrument is actually made, his
capacity is undoubted.25
On the other hand, property relations between spouses
are governed principally by the national law of the
spouses.26 However, the party invoking the application
of a foreign law has the burden of proving the foreign
law. The foreign law is a question of fact to be properly
pleaded and proved as the judge cannot take judicial
notice of a foreign law.27 He is presumed to know only
domestic or the law of the forum.28
To prove a foreign law, the party invoking it must
present a copy thereof and comply with Sections 24
and 25 of Rule 132 of the Revised Rules of Court which
reads:
SEC. 24. Proof of official record. — The record of public
documents referred to in paragraph (a) of Section 19,
when admissible for any purpose, may be evidenced
by an official publication thereof or by a copy attested
by the officer having the legal custody of the record, or
by his deputy, and accompanied, if the record is not
kept in the Philippines, with a certificate that such
officer has the custody. If the office in which the record
is kept is in a foreign country, the certificate may be
made by a secretary of the embassy or legation, consul
general, consul, vice consul, or consular agent or by
any officer in the foreign service of the Philippines
stationed in the foreign country inwhich the record is
kept, and authenticated by the seal of his office.
(Emphasis supplied)
SEC. 25. What attestation ofcopy must state. —
Whenever a copy of a document or record is attested
for the purpose of the evidence, the attestation must
state, in substance, that the copy is a correct copy of
the original, or a specific part thereof, as the case may
be. The attestation must be under the official seal of
the attesting officer, if there be any, or if he be the clerk
of a court having a seal, under the seal of such court.
Accordingly, matters concerning the title and
disposition of real property shall be governed by
Philippine law while issues pertaining to the conjugal
natureof the property shall be governed by South
Korean law, provided it is proven as a fact.
In the present case, Orion, unfortunately failed to prove
the South Korean law on the conjugal ownership
ofproperty. It merely attached a "Certification from the
Embassy of the Republic of Korea"29 to prove the
existence of Korean Law. This certification, does not
qualify as sufficient proof of the conjugal nature of the
property for there is no showing that it was properly
authenticated bythe seal of his office, as required
under Section 24 of Rule 132.30
Accordingly, the International Law doctrine of
presumed-identity approachor processual presumption
comes into play, i.e., where a foreign law is not pleaded
or, evenif pleaded, is not proven, the presumption is
that foreign law is the same as Philippine Law.31
Under Philippine Law, the phrase "Yung Sam Kang
‘married to' Hyun Sook Jung" is merely descriptive of
the civil status of Kang.32 In other words, the import
from the certificates of title is that Kang is the owner of
the properties as they are registered in his name alone,
and that he is married to Hyun Sook Jung.
We are not unmindful that in numerous cases we have
held that registration of the property in the name of only
one spouse does not negate the possibility of it being
conjugal or community property.33 In those cases,
however, there was proof that the properties, though
registered in the name of only one spouse, were
indeed either conjugal or community
properties.34 Accordingly, we see no reason to declare
as invalid Kang’s conveyance in favor of Suzuki for the
supposed lack of spousal consent.
The petitioner failed to adduce sufficient evidence to
prove the due execution of the Dacion en Pago
Article 1544 of the New Civil Codeof the Philippines
provides that:
ART. 1544. If the same thing should have been sold to
different vendees, the ownership shall be transferred to
the person who may have first taken possession
thereof in good faith, if it should be movable property.
Should it be immovable property, the ownership shall
belong to the person acquiring it who in good faith first
recorded it in the Registry of Property.
Should there be no inscription, the ownership shall
pertain to the person who in good faith was first in the
possession; and, in the absence thereof, to the person
who presents the oldest title, provided there is good
faith.
The application of Article 1544 of the New Civil Code
presupposes the existence of two or more duly
executed contracts of sale. In the present case, the
Deed of Sale dated August 26, 200335 between Suzuki
and Kang was admitted by Orion36 and was properly
identified by Suzuki’s witness Ms. Mary Jane Samin
(Samin).37
It is not disputed, too, that the Deed of Sale dated
August 26, 2003 was consummated. In a contract of
sale, the seller obligates himself to transfer the
ownership of the determinate thing sold, and to deliver
the same to the buyer, who obligates himself to pay a
price certain to the seller.38 The execution of the
notarized deed of saleand the actual transfer of
possession amounted to delivery that produced the
legal effect of transferring ownership to Suzuki.39
On the other hand, although Orion claims priority in
right under the principle of prius tempore, potior jure
(i.e.,first in time, stronger in right), it failedto prove the
existence and due execution of the Dacion en Pagoin
its favor.
At the outset, Orion offered the Dacion en Pagoas
Exhibit "5"with submarkings "5-a" to "5-c" to prove the
88
existence of the February 6, 2003 transaction in its
Formal Offer dated July 20, 2008. Orion likewise
offered in evidence the supposed promissory note
dated September 4, 2002 as Exhibit "12"to prove the
existence of the additional P800,000.00 loan. The
RTC, however, denied the admission of Exhibits "5"
and "12,"among others, in its order dated August 19,
2008 "since the same [were] not identified in court by
any witness."40
Despite the exclusion of its most critical documentary
evidence, Orion failed to make a tender ofexcluded
evidence, as provided under Section 40, Rule 132 of
the Rules of Court. For this reason alone, we are
prevented from seriously considering Exhibit "5" and its
submarkings and Exhibit "12" in the present petition.
Moreover, even if we consider Exhibit "5" and its
submarkings and Exhibit "12" in the present petition,
the copious inconsistencies and contradictions in the
testimonial and documentary evidence of Orion,
militate against the conclusion that the Dacion en
Pagowas duly executed. First, there appears to be no
due and demandable obligation when the Dacion en
Pago was executed, contrary to the allegations of
Orion. Orion’s witness Perez tried to impress upon the
RTC that Kang was in default in his P1,800,000.00
loan. During his direct examination, he stated:
ATTY. CRUZAT:
Q: Okay, so this loan of P1.8 million, what happened to
this loan, Mr. Witness?
A: Well it became past due, there has been delayed
interest payment by Mr. Kangand...
Q: So what did you do after there were defaults[?]
A: We have to secure the money or the investment of
the bank through loans and we have executed a dacion
en pagobecause Mr. Kang said he has no money. So
we just execute[d] the dacion en pago rather than
going through the Foreclosure proceedings.
xxxx
Q: Can you tell the court when was this executed?
A: February 6, 2003, your Honor.41
A reading of the supposed promissory note, however,
shows that there was nodefault to speak of when the
supposed Dacion en Pagowas executed.
Based on the promissory note, Kang’s loan obligation
wouldmature only on August 27, 2003. Neither can
Orion claim that Kang had been in default in his
installment payments because the wordings of the
promissory note provide that "[t]he principal of this
loanand its interest and other charges shall be paid by
me/us in accordance hereunder: SINGLE PAYMENT
LOANS.42 "There was thus no due and demandable
loan obligation when the alleged Dacion en Pago was
executed.
Second, Perez, the supposed person who prepared
the Dacion en Pago,appears to only have a vague idea
of the transaction he supposedly prepared. During his
cross-examination, he testified:
ATTY. DE CASTRO:
Q: And were you the one who prepared this [dacion en
pago] Mr. witness?
A: Yes, sir. I personally prepared this.
xxxx
Q: So this 1.8 million pesos is already inclusive of all
the penalties, interest and surcharge due from Mr.
Yung Sam Kang?
A: It’s just the principal, sir.
Q: So you did not state the interest [and] penalties?
A: In the [dacion en pago], we do not include interest,
sir. We may actually includethat but....
Q: Can you read the Second Whereas Clause, Mr.
Witness?
A: Whereas the first party failed to pay the said loan to
the second party and as of February 10, 2003, the
outstanding obligation which is due and demandable
principal and interest and other charges included
amounts to P1,800,000.00 pesos, sir.
xxxx
Q: You are now changing your answer[.] [I]t now
includes interest and other charges, based on this
document?
A: Yes, based on that document, sir.43
Third, the Dacion en Pago,mentioned that
the P1,800,000.00 loan was secured by a real estate
mortgage. However, no document was ever presented
to prove this real estate mortgage aside from it being
mentioned in the Dacion en Pago itself.
ATTY. DE CASTRO:
Q: Would you know if there is any other document like
a supplement to that Credit Line Agreement referring
to this 1.8 million peso loan by Mr. Yung Sam Kang
which says that there was a subsequent
collateralization or security given by Mr. Yung [Sam]
Kang for the loan?
xxxx
A: The [dacion en pago], sir.44
Fourth,the Dacion en Pago was first mentioned only
two (2) months after Suzuki and Samin demanded the
delivery of the titles sometime in August 2003,and after
Suzuki caused the annotation of his affidavit of adverse
claim. Records show that it was only on October 9,
2003, when Orion, through its counsel, Cristobal Balbin
Mapile & Associates first spoke of the Dacion en
Pago.45 Not even Perez mentioned any Dacion en
Pago on October 1, 2003, when he personally received
a letter demanding the delivery of the titles.Instead,
Perez refused to accept the letter and opted to first
consult with his lawyer.46
Notably, even the October 9, 2003 letter contained
material inconsistencies in its recital of facts
surrounding the execution of the Dacion en Pago. In
particular, it mentioned that "on [September 4, 2002],
after paying the original loan, [Kang] applied and was
granted a new Credit Line Facility by [Orion] x x x for
ONE MILLION EIGHT HUNDRED THOUSAND
PESOS (P1,800,000.00)." Perez, however, testified
that there was "no cash movement" in the
original P1,000,000.00 loan. In his testimony, he said:
COURT:
89
xxxx
Q: Would you remember what was the subject matter
of that real estate mortgage for that firstP1,000,000.00
loan?
A: It’s a condominium Unit in Cityland, sir.
xxxx
Q: Would you recall if there was any payment by Mr.
Yung Sam Kang of this P1,000,000.00 loan?
A: None sir.
Q: No payments?
A: None sir.
Q: And from 1999 to 2002, there was no payment,
either by way of payment to the principal, by way
ofpayment of interest, there was no payment by Mr.
Yung Sam Kang of this loan?
A: Literally, there was no actual cash movement, sir.
Q: There was no actual cash?
A: Yes, sir.
Q: And yet despite no payment, the bank Orion
Savings Bank still extended an P800,000.00 additional
right?
A: Yes, sir.47
Fifth, it is undisputed that notwithstanding the
supposed execution of theDacion en Pago on February
2, 2003, Kang remained in possession of the
condominium unit. In fact, nothing in the records shows
that Orion even bothered to take possession of the
property even six (6) months after the supposed date
of execution of the Dacion en Pago. Kang was even
able to transfer possession of the condominium unit to
Suzuki, who then made immediate improvements
thereon. If Orion really purchased the condominium
unit on February 2, 2003 and claimed to be its true
owner, why did it not assert its ownership immediately
after the alleged sale took place? Why did it have to
assert its ownership only after Suzuki demanded the
delivery of the titles? These gaps have remained
unanswered and unfilled.
In Suntay v. CA,48 we held that the most prominent
index of simulation is the complete absence of
anattempt on the part of the vendee to assert his rights
of ownership over the property in question. After the
sale, the vendee should have entered the land and
occupied the premises. The absence of any attempt on
the part of Orion to assert its right of dominion over the
property allegedly soldto it is a clear badge of fraud.
That notwithstanding the execution of the Dacion en
Pago, Kang remained in possession of the disputed
condominium unit – from the time of the execution of
the Dacion en Pagountil the property’s subsequent
transfer to Suzuki – unmistakably strengthens the
fictitious nature of the Dacion en Pago.
These circumstances, aside from the glaring
inconsistencies in the documents and testimony of
Orion’s witness, indubitably prove the spurious nature
of the Dacion en Pago.
The fact that the Dacion en Pago is a notarized
document does not support the conclusion that the sale
it embodies is a true conveyance
Public instruments are evidence of the facts that gave
rise to their execution and are to be considered as
containing all the terms of the agreement. 49 While a
notarized document enjoys this presumption, "the fact
that a deed is notarized is not a guarantee of the
validity of its contents."50 The presumption of regularity
of notarized documents is not absolute and may be
rebutted by clear and convincing evidence to the
contrary.51
In the present case, the presumption cannot apply
because the regularity in the execution of the Dacion
en Pago and the loan documents was challenged in the
proceedings below where their prima facievalidity was
overthrown by the highly questionable circumstances
surrounding their execution.52
Effect of the PRA restriction on the validity of Suzuki’s
title to the property
Orion argues that the PRA restriction in CCT No. 18186
affects the conveyance to Suzuki. In particular, Orion
assails the status of Suzuki as a purchaser in good faith
in view of the express PRA restriction contained in CCT
No. 18186.53
We reject this suggested approachoutright because, to
our mind, the PRA restriction cannot affect the
conveyance in favor of Suzuki. On this particular point,
we concur withthe following findings of the CA:
x x x the annotation merely servesas a warning to the
owner who holds a Special Resident Retiree’s
Visa(SRRV) that he shall lose his visa if he disposes
his property which serves as his investment in order to
qualify for such status. Section 14 of the Implementing
Investment Guidelines under Rule VIII-A of the Rules
and Regulations Implementing Executive Order No.
1037, Creating the Philippine Retirement Park System
Providing Funds Therefor and For Other Purpose (
otherwise known as the Philippine Retirement
Authority) states:
Section 14. Should the retiree-investor withdraw his
investment from the Philippines, or transfer the same
to another domestic enterprise, orsell, convey or
transfer his condominium unit or units to another
person, natural or juridical without the prior approval of
the Authority, the Special Resident Retiree’s Visa
issued to him, and/or unmarried minor child or
children[,] may be cancelled or revoked by the
Philippine Government, through the appropriate
government department or agency, upon
recommendation of the Authority.54
Moreover, Orion should not be allowed to successfully
assail the good faith of Suzuki on the basis of the PRA
restriction. Orion knew of the PRA restriction when it
transacted with Kang. Incidentally, Orion admitted
accommodating Kang’s request to cancel the
mortgage annotation despite the lack of payment to
circumvent the PRA restriction. Orion, thus, is
estopped from impugning the validity of the
conveyance in favor of Suzuki on the basis of the PRA
restriction that Orion itself ignored and "attempted" to
circumvent.
With the conclusion that Orion failed to prove the
authenticity of the Dacion en Pago, we see no reason
for the application of the rules on double sale under
Article 1544 of the New Civil Code. Suzuki, moreover,
successfully adduced sufficient evidence to establish
the validity of conveyance in his favor.
90
 7 20
WHEREFORE, premises considered, we DENY the Id. at 251. Hubert Nuñez v. SLTEAS Phoenix Solutions, Inc.,
petition for lack of merit. Costs against petitioner Orion G.R. No. 180542, April 12, 2010, 368 SCRA 134, 145.
8
Savings Bank. Id. at 252.
21Agpalo, Ruben E., Conflict of Laws, 2004 Ed., p.
9
SO ORDERED. Id. at 253-254. 182.
10
ARTURO D. BRION Id. at 270 22
Salonga, Jovito R., Private International Law, 1995
Associate Justice 11 Ed., p. 132, citing Wolff 515.
Id. at 271.
WE CONCUR: 23
12 Agpalo, Ruben E., Conflict of Laws, 2004 Ed., p.
Id. at 262.
183.
ANTONIO T. CARPIO 13 Id. at 263-264. 24
Associate Justice Id.
Chairperson 14 Id. at 92-135. 25 Id.
MARIANO C. DEL JOSE CATRAL 15 Id. at 8-31. 26
CASTILLO MENDOZA Family Code of the Philippines, Art. 80. In the
Associate Justice Associate Justice 16 Id. at 65-89. absence of a contrary stipulation in a marriage
settlement, the property relations of the spouses shall
17 be governed by Philippine laws, regardless of the place
MARVIC M.V.F. LEONEN Id.
Associate Justice of the celebration of the marriage and their residence.
18Century Iron Works, Inc. v. Banas, G.R. No. 184116,
CERTIFICATION June 19, 2013, 699 SCRA 157, 166. This rule shall not apply:

Pursuant to Section 13, Article VIII of the Constitution, 19 Luna v. Linatoc, 74 Phil. 15 (1942). See also New
I certify that the conclusions in the above Decision City Builders, Inc. v. NLRC, 499 Phil. 207, 212-213
had been reached in consultation before the case was (2005), citing Insular Life Assurance Company, Ltd. v.
assigned to the writer of the opinion of the Court's CA, G.R. No. 126850, April 28, 2004, 401 SCRA 79,
Division. the Supreme Court recognized several exceptions to
this rule, to wit: "(1) when the findings are grounded
ANTONIO T. CARPIO entirely on speculation, surmises or conjectures; (2)
Acting Chief Justice
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
Footnotes are conflicting; (6) when in making its findings the Court
of Appeals went beyond the issues of the case, or its
1 Rollo, pp. 8-31. findings are contrary to the admissions of both the
appellant and the appellee; (7) when the findings are
2Id. at 35-51; penned by Associate Justice Agnes contrary to the trial court; (8) when the findings are
Reyes-Carpio, with Associate Justices Rosalinda conclusions without citation of specific evidence on
Asuncion-Vicente and Priscilla J. Baltazar-Padilla, which they are based; (9) when the facts set forth in the
concurring. petition as well as in the petitioner’s main and reply
3
briefs are not disputed by the respondent; (10) when
Id. at 53-55. the findings of fact are premised on the supposed
4 absence of evidence and contradicted by the evidence
Records, Vol. I, pp. 257-258.
on record; and (11) when the Court of Appeals
5 Id. at 259-260. manifestly overlooked certain relevant facts not
disputed by the parties, which, if properly considered,
6 would justify a different conclusion."
Id. at 250.
(1) Where both spouses are aliens;
(2) With respect to the extrinsic validity of contracts
affecting property not situated in the Philippines and
executed in the country where the property is located;
and
(3) With respect to the extrinsic validity of contracts
entered into in the Philippines but affecting property
situated in a foreign country whose laws require
different formalities for its extrinsic validity.
27ATCI Overseas Corporation v. Echin, G.R. No.
178551, October 11, 2010, 632 SCRA 528, 534.
28
Id.
29
Rollo, pp. 57-58.
30 Id.
31 Supranote 26.
32
Stuart v. Yatco, 114 Phil. 1083, 1084-1085 (1962);
Magallon v. Montejo, 230 Phil. 366, 377 (1986).
33
Bucoy v. Paulino, 131 Phil. 790 (1968).
34 See Mendoza v. Reyes, 209 Phil. 120 (1983).

91
35 Records, Vol. I, pp. 213-214. of the Philippine Retirement Authority, the owner-
named herein being a holder of Special Resident
36 Id. at 291. Retiree’s Visa (SRRV), and is therefore, subject to the
37 provision of Executive Order No. 1037 and it0`s
TSN, February 28, 2005, pp. 29-36.
implementing Rules and Regulations." (Doc. No. 68, p.
38 NEW CIVIL CODE, Article 1458. 14, Bk.XIV, s. of 2000 of Not. Pub. For Mand. *City,
Eddie Fernandez, dated June 23, 2000.) Date of
39 Id., Article 1496 in relation to Article 1498. Inscription-June 23, 2000-1:33 p.m.
54
40 Records, Vol. II, p. 395. Rollo, p. 47.
41 TSN, June 1, 2007, pp. 32-33, emphasis supplied.
42 Records, Vol. II, p. 369. In fact, so important was the
single payment arrangement that Orion only allowed
installment payments upon additional payment of Two
Percent (2.00%) per annum service fee and a written
notice to Orion of not less than thirty(30) days prior to
the proposed payment.
43TSN, December 17, 2007, pp. 29-32, emphasis
supplied.
44 Id. at. 22.
45 Records, Vol. II, pp. 371-372.
46 Records, Vol. I, pp. 263-267.
47TSN, December 17, 2007, pp. 14-16, emphasis
supplied.
48 321 Phil. 809, 831-832 (1995).
49 Bough v. Cantiveros, 40 Phil. 209, 215 (1919).
50Nazareno v. Court of Appeals, 397 Phil. 707, 725
(2000);San Juan v. Offril, G.R. No. 154609, April 24,
2009, 586 SCRA 439, 445-446.
51Lazaro v. Agustin, G.R. No. 152364, April 15, 2010,
618 SCRA 298, 309; Potenciano v. Reynoso, 449 Phil.
396, 406 (2003).
52 San Juan v. Offril, supra note 50.
53Entry No. 73321/C-10186-RESTRICTIONS: IN an
instrument duly subscribed and sworn to, VERNETTE
UMALI-PACO, CESO II, Phil. Retirement Authority,
states that the property described herein is subject to
the following restriction: "The sale, transfer, or
encumbrance of this property is subject to the approval

92

Republic of the Philippines
SUPREME COURT
SECOND DIVISION
G.R. No. 157314 July 29, 2005
FAR EAST BANK AND TRUST COMPANY, NOW
BANK OF THE PHILIPPINE ISLANDS, Petitioners,
vs.
THEMISTOCLES PACILAN, JR., Respondent.
DECISION
CALLEJO, SR., J.:
Before the Court is the petition for review
on certiorari filed by Far East Bank and Trust Company
(now Bank of the Philippines Islands) seeking the
reversal of the Decision1 dated August 30, 2002 of the
Court of Appeals (CA) in CA-G.R. CV No. 36627 which
ordered it, together with its branch accountant, Roger
Villadelgado, to pay respondent Themistocles Pacilan,
Jr.2 the total sum of P100,000.00 as moral and
exemplary damages. The assailed decision affirmed
with modification that of the Regional Trial Court (RTC)
of Negros Occidental, Bacolod City, Branch 54, in Civil
Case No. 4908. Likewise sought to be reversed and set
aside is the Resolution dated January 17, 2003 of the
appellate court, denying petitioner bank’s motion for
reconsideration.
The case stemmed from the following undisputed facts:
Respondent Pacilan opened a current account with
petitioner bank’s Bacolod Branch on May 23, 1980. His
account was denominated as Current Account No.
53208 (0052-00407-4). The respondent had since then
issued several postdated checks to different payees
drawn against the said account. Sometime in March
1988, the respondent issued Check No. 2434886 in the
amount of P680.00 and the same was presented for
payment to petitioner bank on April 4, 1988.
Upon its presentment on the said date, Check No.
2434886 was dishonored by petitioner bank. The next
day, or on April 5, 1988, the respondent deposited to
his current account the amount of P800.00. The said
amount was accepted by petitioner bank; hence,
increasing the balance of the respondent’s deposit
to P1,051.43.
Subsequently, when the respondent verified with
petitioner bank about the dishonor of Check No.
2434866, he discovered that his current account was
closed on the ground that it was "improperly handled."
The records of petitioner bank disclosed that between
the period of March 30, 1988 and April 5, 1988, the
respondent issued four checks, to wit: Check No.
2480416 for P6,000.00; Check No. 2480419
for P50.00; Check No. 2434880 for P680.00 and;
Check No. 2434886 for P680.00, or a total amount
ofP7,410.00. At the time, however, the respondent’s
current account with petitioner bank only had a deposit
ofP6,981.43. Thus, the total amount of the checks
presented for payment on April 4, 1988 exceeded the
balance of the respondent’s deposit in his account. For
this reason, petitioner bank, through its branch
accountant, Villadelgado, closed the respondent’s
current account effective the evening of April 4, 1988
as it then had an overdraft of P428.57. As a
consequence of the overdraft, Check No. 2434886 was
dishonored.
On April 18, 1988, the respondent wrote to petitioner
bank complaining that the closure of his account was
unjustified. When he did not receive a reply from
petitioner bank, the respondent filed with the RTC of
Negros Occidental, Bacolod City, Branch 54, a
complaint for damages against petitioner bank and
Villadelgado. The case was docketed as Civil Case No.
4908. The respondent, as complainant therein, alleged
93
that the closure of his current account by petitioner
bank was unjustified because on the first banking hour
of April 5, 1988, he already deposited an amount
sufficient to fund his checks. The respondent pointed
out that Check No. 2434886, in particular, was
delivered to petitioner bank at the close of banking
hours on April 4, 1988 and, following normal banking
procedure, it
(petitioner bank) had until the last clearing hour of the
following day, or on April 5, 1988, to honor the check
or return it, if not funded. In disregard of this banking
procedure and practice, however, petitioner bank
hastily closed the respondent’s current account and
dishonored his Check No. 2434886.
The respondent further alleged that prior to the closure
of his current account, he had issued several other
postdated checks. The petitioner bank’s act of closing
his current account allegedly preempted the deposits
that he intended to make to fund those checks. Further,
the petitioner bank’s act exposed him to criminal
prosecution for violation of Batas Pambansa Blg. 22.
According to the respondent, the indecent haste that
attended the closure of his account was patently
malicious and intended to embarrass him. He claimed
that he is a Cashier of Prudential Bank and Trust
Company, whose branch office is located just across
that of petitioner bank, and a prominent and respected
leader both in the civic and banking communities. The
alleged malicious acts of petitioner bank besmirched
the respondent’s reputation and caused him "social
humiliation, wounded feelings, insurmountable worries
and sleepless nights" entitling him to an award of
damages.
In their answer, petitioner bank and Villadelgado
maintained that the respondent’s current account was
subject to petitioner bank’s Rules and Regulations
Governing the Establishment and Operation of Regular
Demand Deposits which provide that "the Bank
reserves the right to close an account if the depositor
frequently draws checks against insufficient funds
and/or uncollected deposits" and that "the Bank
reserves the right at any time to return checks of the
depositor which are drawn against insufficient funds or
for any reason."3
They showed that the respondent had improperly and
irregularly handled his current account. For example,
in 1986, the respondent’s account was overdrawn 156
times, in 1987, 117 times and in 1988, 26 times. In all
these instances, the account was overdrawn due to the
issuance of checks against insufficient funds. The
respondent had also signed several checks with a
different signature from the specimen on file for
dubious reasons.
When the respondent made the deposit on April 5,
1988, it was obviously to cover for issuances made the
previous day against an insufficiently funded account.
When his Check No. 2434886 was presented for
payment on April 4, 1988, he had already incurred an
overdraft; hence, petitioner bank rightfully dishonored
the same for insufficiency of funds.
After due proceedings, the court a quo rendered
judgment in favor of the respondent as it ordered the
petitioner bank and Villadelgado, jointly and severally,
to pay the respondent the amounts of P100,000.00 as
moral damages and P50,000.00 as exemplary
damages and costs of suit. In so ruling, the court a
quo also cited petitioner bank’s rules and regulations
which state that "a charge of P10.00 shall be levied
against the depositor for any check that is taken up as
a returned item due to ‘insufficiency of funds’ on the
date of receipt from the clearing office even if said
check is honored and/or covered by sufficient deposit
the following banking day." The same rules and
regulations also provide that "a check returned for
insufficiency of funds for any reason of similar import
may be subsequently recleared for one more time only,
subject to the same charges."
According to the court a quo, following these rules and
regulations, the respondent, as depositor, had the right
to put up sufficient funds for a check that was taken as
a returned item for insufficient funds the day following
the receipt of said check from the clearing office. In
fact, the said check could still be recleared for one
more time. In previous instances, petitioner bank
notified the respondent when he incurred an overdraft
and he would then deposit sufficient funds the following
day to cover the overdraft. Petitioner bank thus acted
unjustifiably when it immediately closed the
respondent’s account on April 4, 1988 and deprived
him of the opportunity to reclear his check or deposit
sufficient funds therefor the following day.
As a result of the closure of his current account, several
of the respondent’s checks were subsequently
dishonored and because of this, the respondent was
humiliated, embarrassed and lost his credit standing in
the business community. The court a quo further
ratiocinated that even granting arguendo that
petitioner bank had the right to close the respondent’s
account, the manner which attended the closure
constituted an abuse of the
said right. Citing Article 19 of the Civil Code of the
Philippines which states that "[e]very person must, in
the exercise of his rights and in the performance of his
duties, act with justice, give everyone his due, and
observe honesty and good faith" and Article 20 thereof
which states that "[e]very person who, contrary to law,
wilfully or negligently causes damage to another, shall
indemnify the latter for the same," the court a
quo adjudged petitioner bank of acting in bad faith. It
held that, under the foregoing circumstances, the
respondent is entitled to an award of moral and
exemplary damages.
The decretal portion of the court a quo’s decision
reads:
WHEREFORE, PREMISES CONSIDERED, judgment
is hereby rendered:
1. Ordering the defendants [petitioner bank and
Villadelgado], jointly and severally, to pay plaintiff [the
respondent] the sum of P100,000.00 as moral
damages;
2. Ordering the defendants, jointly and severally, to pay
plaintiff the sum of P50,000.00 as exemplary damages
plus costs and expenses of the suit; and
3. Dismissing [the] defendants’ counterclaim for lack of
merit.
SO ORDERED.4
On appeal, the CA rendered the Decision dated August
30, 2002, affirming with modification the decision of the
court a quo.
The appellate court substantially affirmed the factual
findings of the court a quo as it held that petitioner bank
unjustifiably closed the respondent’s account
notwithstanding that its own rules and regulations
94
allow that a check returned for insufficiency of funds or
any reason of similar import, may be subsequently
recleared for one more time, subject to standard
charges. Like the court a quo, the appellate court
observed that in several instances in previous years,
petitioner bank would inform the respondent when he
incurred an overdraft and allowed him to make a timely
deposit to fund the checks that were initially dishonored
for insufficiency of funds. However, on April 4, 1988,
petitioner bank immediately closed the respondent’s
account without even notifying him that he had incurred
an overdraft. Even when they had already closed his
account on April 4, 1988, petitioner bank still accepted
the deposit that the respondent made on April 5, 1988,
supposedly to cover his checks.
Echoing the reasoning of the court a quo, the CA
declared that even as it may be conceded that
petitioner bank had reserved the right to close an
account for repeated overdrafts by the respondent, the
exercise of that right must never be despotic or
arbitrary. That petitioner bank chose to close the
account outright and return the check, even after
accepting a deposit sufficient to cover the said check,
is contrary to its duty to handle the respondent’s
account with utmost fidelity. The exercise of the right is
not absolute and good faith, at least, is required. The
manner by which petitioner bank closed the account of
the respondent runs afoul of Article 19 of the Civil Code
which enjoins every person, in the exercise of his
rights, "to give every one his due, and observe honesty
and good faith."
The CA concluded that petitioner bank’s precipitate
and imprudent closure of the respondent’s account had
caused him, a respected officer of several civic and
banking associations, serious anxiety and humiliation.
It had, likewise, tainted his credit standing.
Consequently, the award of damages is warranted.
The CA, however, reduced the amount of damages
awarded by the court a quo as it found the same to be
excessive:
We, however, find excessive the amount of damages
awarded by the RTC. In our view the reduced amount
ofP75,000.00 as moral damages and P25,000.00 as
exemplary damages are in order. Awards for damages
are not meant to enrich the plaintiff-appellee [the
respondent] at the expense of defendants-appellants
[the petitioners], but to obviate the moral suffering he
has undergone. The award is aimed at the restoration,
within limits possible, of the status quo ante, and
should be proportionate to the suffering inflicted.5
The dispositive portion of the assailed CA decision
reads:
WHEREFORE, the decision appealed from is hereby
AFFIRMED, subject to the MODIFICATION that the
award of moral damages is reduced to P75,000.00 and
the award of exemplary damages reduced
to P25,000.00.
SO ORDERED.6
Petitioner bank sought the reconsideration of the said
decision but in the assailed Resolution dated January
17, 2003, the appellate court denied its motion. Hence,
the recourse to this Court.
Petitioner bank maintains that, in closing the account
of the respondent in the evening of April 4, 1988, it
acted in good faith and in accordance with the rules
and regulations governing the operation of a
regular demand deposit which reserves to the bank
"the right to close an account if the depositor frequently
draws checks against insufficient funds and/or
uncollected deposits." The same rules and regulations
also provide that "the depositor is not entitled, as a
matter of right, to overdraw on this deposit and the
bank reserves the right at any time to return checks of
the depositor which are drawn against insufficient
funds or for any reason."
It cites the numerous instances that the respondent
had overdrawn his account and those instances where
he deliberately signed checks using a signature
different from the specimen on file. Based on these
facts, petitioner bank was constrained to close the
respondent’s account for improper and irregular
handling and returned his Check No. 2434886 which
was presented to the bank for payment on April 4,
1988.
Petitioner bank further posits that there is no law or rule
which gives the respondent a legal right to make good
his check or to deposit the corresponding amount to
cover said check within 24 hours after the same is
dishonored or returned by the bank for having been
drawn against insufficient funds. It vigorously denies
having violated Article 19 of the Civil Code as it insists
that it acted in good faith and in accordance with the
pertinent banking rules and regulations.
The petition is impressed with merit.
A perusal of the respective decisions of the court a
quo and the appellate court show that the award of
damages in the respondent’s favor was anchored
mainly on Article 19 of the Civil Code which, quoted
anew below, reads:
Art. 19. Every person must, in the exercise of his rights
and in the performance of his duties, act with justice,
give everyone his due, and observe honesty and good
faith.
The elements of abuse of rights are the following: (a)
the existence of a legal right or duty; (b) which is
exercised in bad faith; and (c) for the sole intent of
prejudicing or injuring another.7 Malice or bad faith is at
the core of the said provision.8 The law always
presumes good faith and any person who seeks to be
awarded damages due to acts of another has the
burden of proving that the latter acted in bad faith or
with ill-motive.9 Good faith refers to the state of the
mind which is manifested by the acts of the individual
concerned. It consists of the intention to abstain from
taking an unconscionable and unscrupulous
advantage of another.10 Bad faith does not simply
connote bad judgment or simple negligence, dishonest
purpose or some moral obliquity and conscious doing
of a wrong, a breach of known duty due to some
motives or interest or ill-will that partakes of the nature
of fraud.11Malice connotes ill-will or spite and speaks
not in response to duty. It implies an intention to do
ulterior and unjustifiable harm. Malice is bad faith or
bad motive.12
Undoubtedly, petitioner bank has the right to close the
account of the respondent based on the following
provisions of its Rules and Regulations Governing the
Establishment and Operation of Regular Demand
Deposits:
10) The Bank reserves the right to close an account if
the depositor frequently draws checks against
insufficient funds and/or uncollected deposits.
95
… depositors. Upon the opening of his account, the
12) …
However, it is clearly understood that the depositor is
not entitled, as a matter of right, to overdraw on this
deposit and the bank reserves the right at any time to
return checks of the depositor which are drawn against
insufficient funds or for any other reason.
The facts, as found by the court a quo and the
appellate court, do not establish that, in the exercise of
this right, petitioner bank committed an abuse thereof.
Specifically, the second and third elements for abuse
of rights are not attendant in the present case. The
evidence presented by petitioner bank negates the
existence of bad faith or malice on its part in closing the
respondent’s account on April 4, 1988 because on the
said date the same was already overdrawn. The
respondent issued four checks, all due on April 4,
1988, amounting to P7,410.00 when the balance of his
current account deposit was only P6,981.43. Thus, he
incurred an overdraft of P428.57 which resulted in the
dishonor of his Check No. 2434886. Further, petitioner
bank showed that in 1986, the current account of the
respondent was overdrawn 156 times due to his
issuance of checks against insufficient funds.13 In
1987, the said account was overdrawn 117 times for
the same
reason.14 Again, in 1988, 26 times.15
There were also
several instances when the respondent issued checks
deliberately using a signature different from his
specimen signature on file with petitioner bank. 16 All
these circumstances taken together justified the
petitioner bank’s closure of the respondent’s account
on April 4, 1988 for "improper handling."
It is observed that nowhere under its rules and
regulations is petitioner bank required to notify the
respondent, or any depositor for that matter, of the
closure of the account for frequently drawing checks
against insufficient funds. No malice or bad faith could
be imputed on petitioner bank for so acting since the
records bear out that the respondent had indeed been
improperly and irregularly handling his account not just
a few times but hundreds of times. Under the
circumstances, petitioner bank could not be faulted for
exercising its right in accordance with the express rules
and regulations governing the current accounts of its
Whatever damages the respondent may have suffered
respondent had agreed to be bound by these terms as a consequence, e.g., dishonor of his other
and conditions. insufficiently funded checks, would have to be borne by
him alone. It was the respondent’s repeated improper
Neither the fact that petitioner bank accepted the
deposit made by the respondent the day following the and irregular handling of his account which constrained
closure of his account constitutes bad faith or malice petitioner bank to close the same in accordance with
on the part of petitioner bank. The same could be the rules and regulations governing its depositors’
characterized as simple negligence by its personnel. current accounts. The respondent’s case is clearly one
Said act, by itself, is not constitutive of bad faith. of damnum absque injuria.
The respondent had thus failed to discharge his burden WHEREFORE, the petition is GRANTED. The
of proving bad faith on the part of petitioner bank or that Decision dated August 30, 2002 and Resolution dated
it was motivated by ill-will or spite in closing his account January 17, 2003 of the Court of Appeals in CA-G.R.
on April 4, 1988 and in inadvertently accepting his CV No. 36627 are REVERSED AND SET ASIDE.
deposit on April 5, 1988.
SO ORDERED.
Further, it has not been shown that these acts were
done by petitioner bank with the sole intention of ROMEO J. CALLEJO, SR.
prejudicing and injuring the respondent. It is conceded
Associate Justice
that the respondent may have suffered damages as a
result of the closure of his current account. However, WE CONCUR:
there is a material distinction between damages and
injury. The Court had the occasion to explain the REYNATO S. PUNO
distinction between damages and injury in this wise:
Associate Justice
… Injury is the illegal invasion of a legal right; damage
is the loss, hurt or harm which results from the injury; Chairman
and damages are the recompense or compensation
awarded for the damage suffered. Thus, there can be MA. ALICIA AUSTRIA-MARTINEZ DANTE O.
damage without injury in those instances in which the TINGA
loss or harm was not the result of a violation of a legal Associate Justice Associate Justice
duty. In such cases, the consequences must be borne
by the injured person alone, the law affords no remedy MINITA V. CHICO-NAZARIO
for damages resulting from an act which does not
amount to a legal injury or wrong. These situations are Associate Justice
often called damnum absque injuria.
ATTESTATION
In other words, in order that a plaintiff may maintain an
action for the injuries of which he complains, he must I attest that the conclusions in the above Decision
establish that such injuries resulted from a breach of were reached in consultation before the case was
duty which the defendant owed to the plaintiff – a assigned to the writer of the opinion of the Court’s
concurrence of injury to the plaintiff and legal Division.
responsibility by the person causing it. The underlying
REYNATO S. PUNO
basis for the award of tort damages is the premise that
the individual was injured in contemplation of law. Associate Justice
Thus, there must first be a breach of some duty and the Chairman, Second Division
imposition of liability for that breach before damages
may be awarded; and the breach of such duty should CERTIFICATION
be the proximate cause of the injury.17
96
 13
Pursuant to Section 13, Article VIII of the Constitution, Exhibits "3" up to "3-X," Records, pp. 197-221. (Vol.
and the Division Chairman’s Attestation, it is hereby I)
certified that the conclusions in the above decision
14
were reached in consultation before the case was Exhibits "4" up to "4-U," Id. at 222-243. (Vol. I)
assigned to the writer of the opinion of the Court’s 15 Exhibits "5" up to "5-E," Id. at 244-249.
Division.
16 Exhibits "6" up to "6-C," Id. at 250-253.
HILARIO G. DAVIDE, JR.
17BPI Express Card Corporation v. Court of
Chief Justice
Appeals, G.R. No. 120639, 25 September 1998, 296
SCRA 260.

Footnotes
1Penned by Associate Justice Oswaldo D. Agcaoili,
with Associate Justices Eliezer R. Delos Santos and
Danilo B. Pine, concurring.
2 In the Resolution dated July 1, 2004 of the Court of
Appeals, the Court was furnished a copy of the Notice
of Death of respondent Pacilan, Jr. In compliance with
the Court’s Resolution dated September 27, 2004, his
counsel averred that the respondent was survived by
his children, namely, Jesus Rey, Jesus Rhoel, Jesus
Rene and Jesus Ryan, all surnamed Pacilan.
3 Exhibit "1," Records, p. 195. (Vol. I)
4 Records, p. 344. (Vol. II)
5 Rollo, p. 21.
6 Ibid.
7Development Bank of the Philippines v. Court of
Appeals, G.R. No. 137916, 8 December 2004, 445
SCRA 500.
8ABS-CBN Broadcasting Corporation v. Court of
Appeals, G.R. No. 128690, 21 January 1999, 301
SCRA 572.
9Chua v. Court of Appeals, G.R. No. 112660, 14
March 1995, 242 SCRA 341.
10Saber v. Court of Appeals, G.R. No. 132981, 31
August 2004, 437 SCRA 259.
11 Id. at 278-279.
12 Id. at 279.
97
 CORONA, J.:

Honeste vivere, non alterum laedere et jus suum

cuique tribuere. To live virtuously, not to injure others
and to give everyone his due. These supreme norms
of justice are the underlying principles of law and order
in society. We reaffirm them in this petition for review
on certiorari assailing the July 26, 2000 decision 1 and
October 18, 2000 resolution of the Court of Appeals
(CA) in CA-G.R. CV No. 47571.

In 1982, respondent Ernesto C. Quiamco was

approached by Juan Davalan,2 Josefino Gabutero and
Raul Generoso to amicably settle the civil aspect of a
criminal case for robbery3 filed by Quiamco against
them. They surrendered to him a red Honda XL-100
motorcycle and a photocopy of its certificate of
registration. Respondent asked for the original
certificate of registration but the three accused never
came to see him again. Meanwhile, the motorcycle was
parked in an open space inside respondent’s business
establishment, Avesco-AVNE Enterprises, where it
was visible and accessible to the public.

It turned out that, in October 1981, the motorcycle had

been sold on installment basis to Gabutero by
petitioner Ramas Uypitching Sons, Inc., a family-
owned corporation managed by petitioner Atty. Ernesto
Ramas Uypitching. To secure its payment, the
Republic of the Philippines motorcycle was mortgaged to petitioner corporation.4
SUPREME COURT
Manila When Gabutero could no longer pay the installments,
Davalan assumed the obligation and continued the
SECOND DIVISION payments. In September 1982, however, Davalan
stopped paying the remaining installments and told
G.R. No. 146322 December 6, 2006 petitioner corporation’s collector, Wilfredo Veraño, that
the motorcycle had allegedly been "taken by
ERNESTO RAMAS UYPITCHING and RAMAS
respondent’s men."
UYPITCHING SONS, INC., petitioners,
vs. Nine years later, on January 26, 1991, petitioner
ERNESTO QUIAMCO, respondent. Uypitching, accompanied by policemen,5 went to
Avesco-AVNE Enterprises to recover the motorcycle.
The leader of the police team, P/Lt. Arturo Vendiola,
talked to the clerk in charge and asked for respondent.
DECISION While P/Lt. Vendiola and the clerk were talking,
petitioner Uypitching paced back and forth inside the

98
establishment uttering "Quiamco is a thief of a
motorcycle."
On learning that respondent was not in Avesco-AVNE
Enterprises, the policemen left to look for respondent
in his residence while petitioner Uypitching stayed in
the establishment to take photographs of the
motorcycle. Unable to find respondent, the policemen
went back to Avesco-AVNE Enterprises and, on
petitioner Uypitching’s instruction and over the clerk’s
objection, took the motorcycle.
On February 18, 1991, petitioner Uypitching filed a
criminal complaint for qualified theft and/or violation of
the Anti-Fencing Law6 against respondent in the Office
of the City Prosecutor of Dumaguete
City.7 Respondent moved for dismissal because the
complaint did not charge an offense as he had neither
stolen nor bought the motorcycle. The Office of the City
Prosecutor dismissed the complaint8 and denied
petitioner Uypitching’s subsequent motion for
reconsideration.
Respondent filed an action for damages against
petitioners in the RTC of Dumaguete City, Negros
Oriental, Branch 37.9 He sought to hold the petitioners
liable for the following: (1) unlawful taking of the
motorcycle; (2) utterance of a defamatory remark (that
respondent was a thief) and (3) precipitate filing of a
baseless and malicious complaint. These acts
humiliated and embarrassed the respondent and
injured his reputation and integrity.
On July 30, 1994, the trial court rendered a
decision10 finding that petitioner Uypitching was
motivated with malice and ill will when he called
respondent a thief, took the motorcycle in an abusive
manner and filed a baseless complaint for qualified
theft and/or violation of the Anti-Fencing Law.
Petitioners’ acts were found to be contrary to Articles
1911 and 2012 of the Civil Code. Hence, the trial court
held petitioners liable to respondent for P500,000
moral damages, P200,000 exemplary damages
and P50,000 attorney’s fees plus costs.
Petitioners appealed the RTC decision but the CA
affirmed the trial court’s decision with modification,
reducing the award of moral and exemplary damages
to P300,000 and P100,000, respectively.13 Petitioners
sought reconsideration but it was denied. Thus, this
petition.
In their petition and memorandum, petitioners submit
that the sole (allegedly) issue to be resolved here is
whether the filing of a complaint for qualified theft
and/or violation of the Anti-Fencing Law in the Office of
the City Prosecutor warranted the award of moral
damages, exemplary damages, attorney’s fees and
costs in favor of respondent.
Petitioners’ suggestion is misleading. They were held
liable for damages not only for instituting a groundless
complaint against respondent but also for making a
slanderous remark and for taking the motorcycle from
respondent’s establishment in an abusive manner.
Correctness of the Findings of the RTC and CA
As they never questioned the findings of the RTC and
CA that malice and ill will attended not only the public
imputation of a crime to respondent14 but also the
taking of the motorcycle, petitioners were deemed to
have accepted the correctness of such findings. This
alone was sufficient to hold petitioners liable for
damages to respondent.
Nevertheless, to address petitioners’ concern, we also
find that the trial and appellate courts correctly ruled
that the filing of the complaint was tainted with malice
and bad faith. Petitioners themselves in fact described
their action as a "precipitate act."15 Petitioners were
bent on portraying respondent as a thief. In this
connection, we quote with approval the following
findings of the RTC, as adopted by the CA:
x x x There was malice or ill-will [in filing the complaint
before the City Prosecutor’s Office] because Atty.
Ernesto Ramas Uypitching knew or ought to have
known as he is a lawyer, that there was no probable
cause at all for filing a criminal complaint for qualified
theft and fencing activity against [respondent]. Atty.
Uypitching had no personal knowledge that
[respondent] stole the motorcycle in question. He was
merely told by his bill collector ([i.e.] the bill collector of
Ramas Uypitching Sons, Inc.)[,] Wilfredo Veraño[,] that
Juan Dabalan will [no longer] pay the remaining
installment(s) for the motorcycle because the
motorcycle was taken by the men of [respondent]. It
must be noted that the term used by Wilfredo Veraño
in informing Atty. Ernesto Ramas Uypitching of the
refusal of Juan Dabalan to pay for the remaining
installment was [‘]taken[’], not [‘]unlawfully taken[’] or
‘stolen.’ Yet, despite the double hearsay, Atty. Ernesto
Ramas Uypitching not only executed the [complaint-
affidavit] wherein he named [respondent] as ‘the
suspect’ of the stolen motorcycle but also charged
[respondent] of ‘qualified theft and fencing activity’
before the City [Prosecutor’s] Office of Dumaguete.
The absence of probable cause necessarily signifies
the presence of malice. What is deplorable in all these
is that Juan Dabalan, the owner of the motorcycle, did
not accuse [respondent] or the latter’s men of stealing
the motorcycle[,] much less bother[ed] to file a case for
qualified theft before the authorities. That Atty.
Uypitching’s act in charging [respondent] with qualified
theft and fencing activity is tainted with malice is also
shown by his answer to the question of Cupid
Gonzaga16[during one of their conversations] - "why
should you still file a complaint? You have already
recovered the motorcycle…"[:] "Aron motagam ang
kawatan ug motor." ("To teach a lesson to the thief of
motorcycle.")17
Moreover, the existence of malice, ill will or bad faith is
a factual matter. As a rule, findings of fact of the trial
court, when affirmed by the appellate court, are
conclusive on this Court. We see no compelling reason
to reverse the findings of the RTC and the CA.
Petitioners Abused Their Right of Recovery as
Mortgagee(s)
Petitioners claim that they should not be held liable for
petitioner corporation’s exercise of its right as seller-
mortgagee to recover the mortgaged vehicle
preliminary to the enforcement of its right to foreclose
on the mortgage in case of default. They are clearly
mistaken.
True, a mortgagee may take steps to recover the
mortgaged property to enable it to enforce or protect its
foreclosure right thereon. There is, however, a well-
defined procedure for the recovery of possession of
mortgaged property: if a mortgagee is unable to obtain
possession of a mortgaged property for its sale on
foreclosure, he must bring a civil action either to
recover such possession as a preliminary step to the
sale, or to obtain judicial foreclosure.18
99

Petitioner corporation failed to bring the proper civil
action necessary to acquire legal possession of the
motorcycle. Instead, petitioner Uypitching descended
on respondent’s establishment with his policemen and
ordered the seizure of the motorcycle without a search
warrant or court order. Worse, in the course of the
illegal seizure of the motorcycle, petitioner Uypitching
even mouthed a slanderous statement.
No doubt, petitioner corporation, acting through its co-
petitioner Uypitching, blatantly disregarded the lawful
procedure for the enforcement of its right, to the
prejudice of respondent. Petitioners’ acts violated the
law as well as public morals, and transgressed the
proper norms of human relations.
The basic principle of human relations, embodied in
Article 19 of the Civil Code, provides:
Art. 19. Every person must in the exercise of his rights
and in the performance of his duties, act with justice,
give every one his due, and observe honesty and good
faith.
Article 19, also known as the "principle of abuse of
right," prescribes that a person should not use his right
unjustly or contrary to honesty and good faith,
otherwise he opens himself to liability.19 It seeks to
preclude the use of, or the tendency to use, a legal right
(or duty) as a means to unjust ends.
There is an abuse of right when it is exercised solely to
prejudice or injure another.20 The exercise of a right
must be in accordance with the purpose for which it
was established and must not be excessive or unduly
harsh; there must be no intention to harm
another.21 Otherwise, liability for damages to the
injured party will attach.
In this case, the manner by which the motorcycle was
taken at petitioners’ instance was not only attended by
bad faith but also contrary to the procedure laid down
by law. Considered in conjunction with the defamatory
statement, petitioners’ exercise of the right to recover
the mortgaged vehicle was utterly prejudicial and
injurious to respondent. On the other hand, the
precipitate act of filing an unfounded complaint could
not in any way be considered to be in accordance with
the purpose for which the right to prosecute a crime
was established. Thus, the totality of petitioners’
8
actions showed a calculated design to embarrass, Resolution dated June 14, 1991; rollo, pp. 147-151.
humiliate and publicly ridicule respondent. Petitioners
9
acted in an excessively harsh fashion to the prejudice Presided by Judge Temistocles B. Diez. The case
of respondent. Contrary to law, petitioners willfully was docketed as Civil Case No. 10492.
caused damage to respondent. Hence, they should 10 Penned by Judge Temistocles B. Diez.
indemnify him.22
11 Art. 19. Every person must in the exercise of his
WHEREFORE, the petition is hereby DENIED. The
rights and in the performance of his duties, act with
July 26, 2000 decision and October 18, 2000 resolution
justice, give every one his due, and observe honesty
of the Court of Appeals in CA-G.R. CV No. 47571
are AFFIRMED. and good faith.
12Art. 20. Every person who, contrary to law, willfully
Triple costs against petitioners, considering that
or negligently causes damage to another, shall
petitioner Ernesto Ramas Uypitching is a lawyer and
indemnify the latter for the same.
an officer of the court, for his improper behavior.
13
SO ORDERED. The modification was based on the principle that
moral and exemplary damages are not imposed to
enrich a party.
Puno, J., Chairperson, Sandoval-Gutierrez, Azcuna
and Garcia, JJ., concur. 14In fact, malice is presumed from a defamatory
imputation.
15 Petition, p. 5; rollo, p.17.
Footnotes
16 One of respondent’s witnesses.
1 Penned by Associate Justice Martin S. Villarama, Jr. 17
CA Decision, supra note 1.
and concurred in by Presiding Justice Salome A.
Montoya (retired) and Associate Justice Romeo J. 18
Filinvest Credit Corporation v. Court of Appeals,
Callejo, Sr. (now a member of the Supreme Court) of G.R. No. 115902, 27 September 1995, 248 SCRA 549.
the First Division of the Court of Appeals; rollo, pp. 26-
36. 19Hongkong Shanghai Banking Corporation, Ltd. v.
2
Catalan, G.R. Nos. 159590-91, 18 October 2004, 440
"Juan Dabalan" in some parts of the records. SCRA 498.
3 The case was filed in the Regional Trial Court (RTC) 20 Id.
of Negros Oriental, Dumaguete City, Branch 31 where
it was docketed as Criminal Case No. 5630. On March 21 Id.
3, 1986, the trial court (through Judge Rolando R.
22
Villaraza) convicted Davalan and Generoso and Civil Code, Art. 20.
acquitted Gabutero.
4 The certificate of registration issued to Gabutero bore
the notation "Mortgaged."
5
These policemen were P/Lt. Arturo Vendiola, Pfc.
Damiola, Capt. Tayco, Pat. Romeo Tan and Pat.
Catigtig.
6
Presidential Decree No. 1612.
7 Docketed as I.S. No. 91-74.
100
 G.R. No. 160273 January 18, 2008

CEBU COUNTRY CLUB, INC., SABINO R. DAPAT,

RUBEN D. ALMENDRAS, JULIUS Z. NERI,
DOUGLAS L. LUYM, CESAR T. LIBI,
RAMONTITO* E. GARCIA and JOSE B.
SALA, petitioners,
vs.
RICARDO F. ELIZAGAQUE, respondent.

DECISION

SANDOVAL-GUTIERREZ, J.:

For our resolution is the instant Petition for Review

on Certiorari under Rule 45 of the 1997 Rules of Civil
Procedure, as amended, assailing the Decision1 dated
January 31, 2003 and Resolution dated October 2,
2003 of the Court of Appeals in CA-G.R. CV No. 71506.

The facts are:

Cebu Country Club, Inc. (CCCI), petitioner, is a

domestic corporation operating as a non-profit and
non-stock private membership club, having its principal
place of business in Banilad, Cebu City. Petitioners
herein are members of its Board of Directors.

Sometime in 1987, San Miguel Corporation, a special

company proprietary member of CCCI, designated
respondent Ricardo F. Elizagaque, its Senior Vice
President and Operations Manager for the Visayas and
Mindanao, as a special non-proprietary member. The
designation was thereafter approved by the CCCI’s
Board of Directors.

In 1996, respondent filed with CCCI an application for

proprietary membership. The application was indorsed
by CCCI’s two (2) proprietary members, namely:
Edmundo T. Misa and Silvano Ludo.

As the price of a proprietary share was around the P5

million range, Benito Unchuan, then president of CCCI,
offered to sell respondent a share for only P3.5 million.
Respondent, however, purchased the share of a
certain Dr. Butalid for only P3 million. Consequently, on
Republic of the Philippines
September 6, 1996, CCCI issued Proprietary
SUPREME COURT
Ownership Certificate No. 1446 to respondent.
Manila
During the meetings dated April 4, 1997 and May 30,
FIRST DIVISION
1997 of the CCCI Board of Directors, action on

101
respondent’s application for proprietary membership
was deferred. In another Board meeting held on July
30, 1997, respondent’s application was voted upon.
Subsequently, or on August 1, 1997, respondent
received a letter from Julius Z. Neri, CCCI’s corporate
secretary, informing him that the Board disapproved
his application for proprietary membership.
On August 6, 1997, Edmundo T. Misa, on behalf of
respondent, wrote CCCI a letter of reconsideration. As
CCCI did not answer, respondent, on October 7, 1997,
wrote another letter of reconsideration. Still, CCCI kept
silent. On November 5, 1997, respondent again sent
CCCI a letter inquiring whether any member of the
Board objected to his application. Again, CCCI did not
reply.
Consequently, on December 23, 1998, respondent
filed with the Regional Trial Court (RTC), Branch 71,
Pasig City a complaint for damages against petitioners,
docketed as Civil Case No. 67190.
After trial, the RTC rendered its Decision dated
February 14, 2001 in favor of respondent, thus:
WHEREFORE, judgment is hereby rendered in favor
of plaintiff:
1. Ordering defendants to pay, jointly and severally,
plaintiff the amount of P2,340,000.00 as actual or
compensatory damages.
2. Ordering defendants to pay, jointly and severally,
plaintiff the amount of P5,000,000.00 as moral
damages.
3. Ordering defendants to pay, jointly and severally,
plaintiff the amount of P1,000,000.00 as exemplary
damages.
4. Ordering defendants to pay, jointly and severally,
plaintiff the amount of P1,000,000.00 as and by way of
attorney’s fees and P80,000.00 as litigation expenses.
5. Costs of suit.
Counterclaims are hereby DISMISSED for lack of
merit.
SO ORDERED.2
On appeal by petitioners, the Court of Appeals, in its
Decision dated January 31, 2003, affirmed the trial
court’s Decision with modification, thus:
WHEREFORE, premises considered, the assailed
Decision dated February 14, 2001 of the Regional Trial
Court, Branch 71, Pasig City in Civil Case No. 67190 is
hereby AFFIRMED with MODIFICATION as follows:
1. Ordering defendants-appellants to pay, jointly and
severally, plaintiff-appellee the amount
ofP2,000,000.00 as moral damages;
2. Ordering defendants-appellants to pay, jointly and
severally, plaintiff-appellee the amount
ofP1,000,000.00 as exemplary damages;
3. Ordering defendants-appellants to pay, jointly and
severally, plaintiff-appellee the mount of P500,000.00
as attorney’s fees and P50,000.00 as litigation
expenses; and
4. Costs of the suit.
The counterclaims are DISMISSED for lack of merit.
SO ORDERED.3
On March 3, 2003, petitioners filed a motion for
reconsideration and motion for leave to set the motion
for oral arguments. In its Resolution4 dated October 2,
2003, the appellate court denied the motions for lack of
merit.
Hence, the present petition.
The issue for our resolution is whether in disapproving
respondent’s application for proprietary membership
with CCCI, petitioners are liable to respondent for
damages, and if so, whether their liability is joint and
several.
Petitioners contend, inter alia, that the Court of
Appeals erred in awarding exorbitant damages to
respondent despite the lack of evidence that they acted
in bad faith in disapproving the latter’s application; and
in disregarding their defense of damnum absque
injuria.
For his part, respondent maintains that the petition
lacks merit, hence, should be denied.
CCCI’s Articles of Incorporation provide in part:
SEVENTH: That this is a non-stock corporation and
membership therein as well as the right of participation
in its assets shall be limited to qualified persons who
are duly accredited owners of Proprietary Ownership
Certificates issued by the corporation in accordance
with its By-Laws.
Corollary, Section 3, Article 1 of CCCI’s Amended By-
Laws provides:
SECTION 3. HOW MEMBERS ARE ELECTED – The
procedure for the admission of new members of the
Club shall be as follows:
(a) Any proprietary member, seconded by another
voting proprietary member, shall submit to the
Secretary a written proposal for the admission of a
candidate to the "Eligible-for-Membership List";
(b) Such proposal shall be posted by the Secretary for
a period of thirty (30) days on the Club bulletin board
during which time any member may interpose
objections to the admission of the applicant by
communicating the same to the Board of Directors;
(c) After the expiration of the aforesaid thirty (30) days,
if no objections have been filed or if there are, the
Board considers the objections unmeritorious, the
candidate shall be qualified for inclusion in the
"Eligible-for-Membership List";
(d) Once included in the "Eligible-for-Membership List"
and after the candidate shall have acquired in his name
a valid POC duly recorded in the books of the
corporation as his own, he shall become a Proprietary
Member, upon a non-refundable admission fee
of P1,000.00, provided that admission fees will only be
collected once from any person.
On March 1, 1978, Section 3(c) was amended to read
as follows:
(c) After the expiration of the aforesaid thirty (30) days,
the Board may, by unanimous vote of all directors
present at a regular or special meeting, approve the
inclusion of the candidate in the "Eligible-for-
Membership List".
102
As shown by the records, the Board adopted a secret
balloting known as the "black ball system" of voting
wherein each member will drop a ball in the ballot box.
A white ball represents conformity to the admission of
an applicant, while a black ball means disapproval.
Pursuant to Section 3(c), as amended, cited above, a
unanimous vote of the directors is required. When
respondent’s application for proprietary membership
was voted upon during the Board meeting on July 30,
1997, the ballot box contained one (1) black ball. Thus,
for lack of unanimity, his application was disapproved.
Obviously, the CCCI Board of Directors, under its
Articles of Incorporation, has the right to approve or
disapprove an application for proprietary membership.
But such right should not be exercised arbitrarily.
Articles 19 and 21 of the Civil Code on the Chapter on
Human Relations provide restrictions, thus:
Article 19. Every person must, in the exercise of his
rights and in the performance of his duties, act with
justice, give everyone his due, and observe honesty
and good faith.
Article 21. Any person who willfully causes loss or
injury to another in a manner that is contrary to morals,
good customs or public policy shall compensate the
latter for the damage.
In GF Equity, Inc. v. Valenzona,5 we expounded Article
19 and correlated it with Article 21, thus:
This article, known to contain what is commonly
referred to as the principle of abuse of rights, sets
certain standards which must be observed not only in
the exercise of one's rights but also in the performance
of one's duties. These standards are the following: to
act with justice; to give everyone his due; and to
observe honesty and good faith. The law, therefore,
recognizes a primordial limitation on all rights; that in
their exercise, the norms of human conduct set forth in
Article 19 must be observed. A right, though by itself
legal because recognized or granted by law as
such, may nevertheless become the source of
some illegality. When a right is exercised in a
manner which does not conform with the norms
enshrined in Article 19 and results in damage to
another, a legal wrong is thereby committed for
which the wrongdoer must be held responsible. But
while Article 19 lays down a rule of conduct for the
government of human relations and for the
maintenance of social order, it does not provide a
remedy for its violation. Generally, an action for
damages under either Article 20 or Article 21 would be
proper. (Emphasis in the original)
In rejecting respondent’s application for proprietary
membership, we find that petitioners violated the rules
governing human relations, the basic principles to be
observed for the rightful relationship between human
beings and for the stability of social order. The trial
court and the Court of Appeals aptly held that
petitioners committed fraud and evident bad faith in
disapproving respondent’s applications. This is
contrary to morals, good custom or public policy.
Hence, petitioners are liable for damages pursuant to
Article 19 in relation to Article 21 of the same Code.
It bears stressing that the amendment to Section 3(c)
of CCCI’s Amended By-Laws requiring the unanimous
vote of the directors present at a special or regular
meeting was not printed on the application form
respondent filled and submitted to CCCI. What was
printed thereon was the original provision of Section
3(c) which was silent on the required number of votes
needed for admission of an applicant as a proprietary
member.
Petitioners explained that the amendment was not
printed on the application form due to economic
reasons. We find this excuse flimsy and unconvincing.
Such amendment, aside from being extremely
significant, was introduced way back in 1978 or almost
twenty (20) years before respondent filed his
application. We cannot fathom why such a prestigious
and exclusive golf country club, like the CCCI, whose
members are all affluent, did not have enough money
to cause the printing of an updated application form.
It is thus clear that respondent was left groping in the
dark wondering why his application was disapproved.
He was not even informed that a unanimous vote of the
Board members was required. When he sent a letter
for reconsideration and an inquiry whether there was
an objection to his application, petitioners apparently
ignored him. Certainly, respondent did not deserve this
kind of treatment. Having been designated by San
Miguel Corporation as a special non-proprietary
member of CCCI, he should have been treated by
petitioners with courtesy and civility. At the very least,
they should have informed him why his application was
disapproved.
The exercise of a right, though legal by itself, must
nonetheless be in accordance with the proper norm.
When the right is exercised arbitrarily, unjustly or
excessively and results in damage to another, a legal
wrong is committed for which the wrongdoer must be
held responsible.6 It bears reiterating that the trial court
and the Court of Appeals held that petitioners’
disapproval of respondent’s application is
characterized by bad faith.
As to petitioners’ reliance on the principle of damnum
absque injuria or damage without injury, suffice it to
state that the same is misplaced. In Amonoy v.
Gutierrez,7 we held that this principle does not apply
when there is an abuse of a person’s right, as in this
case.
As to the appellate court’s award to respondent of
moral damages, we find the same in order. Under
Article 2219 of the New Civil Code, moral damages
may be recovered, among others, in acts and actions
referred to in Article 21. We believe respondent’s
testimony that he suffered mental anguish, social
humiliation and wounded feelings as a result of the
arbitrary denial of his application. However, the amount
of P2,000,000.00 is excessive. While there is no hard-
and-fast rule in determining what would be a fair and
reasonable amount of moral damages, the same
should not be palpably and scandalously excessive.
Moral damages are not intended to impose a penalty
to the wrongdoer, neither to enrich the claimant at the
expense of the defendant.8 Taking into consideration
the attending circumstances here, we hold that an
award to respondent of P50,000.00, instead
of P2,000,000.00, as moral damages is reasonable.
Anent the award of exemplary damages, Article 2229
allows it by way of example or correction for the public
good. Nonetheless, since exemplary damages are
imposed not to enrich one party or impoverish another
but to serve as a deterrent against or as a negative
incentive to curb socially deleterious actions,9 we
reduce the amount from P1,000,000.00 to P25,000.00
only.
On the matter of attorney’s fees and litigation
expenses, Article 2208 of the same Code provides,
103
among others, that attorney’s fees and expenses of
litigation may be recovered in cases when exemplary
damages are awarded and where the court deems it
just and equitable that attorney’s fees and expenses of
litigation should be recovered, as in this case. In any
event, however, such award must be reasonable, just
and equitable. Thus, we reduce the amount of
attorney’s fees (P500,000.00) and litigation expenses
(P50,000.00) to P50,000.00 andP25,000.00,
respectively.
Lastly, petitioners’ argument that they could not be held
jointly and severally liable for damages because only
one (1) voted for the disapproval of respondent’s
application lacks merit.
Section 31 of the Corporation Code provides:
SEC. 31. Liability of directors, trustees or officers. —
Directors or trustees who willfully and knowingly vote
for or assent to patently unlawful acts of the corporation
or who are guilty of gross negligence or bad faithin
directing the affairs of the corporation or acquire any
personal or pecuniary interest in conflict with their duty
as such directors, or trustees shall be liable jointly
and severally for all damages resulting therefrom
suffered by the corporation, its stockholders or
members and other persons. (Emphasis ours)
WHEREFORE, we DENY the petition. The challenged
Decision and Resolution of the Court of Appeals in CA-
G.R. CV No. 71506 are AFFIRMED with modification
in the sense that (a) the award of moral damages is
reduced fromP2,000,000.00 to P50,000.00; (b) the
award of exemplary damages is reduced
from P1,000,000.00 toP25,000.00; and (c) the award
of attorney’s fees and litigation expenses is reduced
from P500,000.00 andP50,000.00 to P50,000.00
and P25,000.00, respectively.
Costs against petitioners.
SO ORDERED.
Puno, C.J., Chairperson, Corona, Azcuna, Leonardo-
de Castro, JJ., concur.
Footnotes
*Also referred to as "Ramonito" in the records of the
case.
1
Penned by Associate Justice Remedios A. Salazar-
Fernando and concurred in by then Associate Justice
Ruben T. Reyes (now a member of this Court) and
Associate Justice Edgardo F. Sundiam.
2 Annex "C" of the petition, rollo, pp. 65-91.
3 Annex "A" of the petition, id., pp. 40-62.
4 Clemente, Jr. (Clemente).
Annex "B" of the petition, id., pp. 63-64.
5 G.R. No. 156841, June 30, 2005, 462 SCRA 466.
6Solidbank Corporation v. Mindanao Ferroalloy
Corporation, G.R. No. 153535, July 28, 2005, 464
SCRA 409, 428, citing Metropolitan Waterworks and
Sewerage System v. Act Theater, Inc., 432 SCRA 418,
422 (2004).
7 G.R. No. 140420, February 15, 2001, 351 SCRA 731.
8Lamis v. Ong, G.R. No. 148923, August 11, 2005,
466 SCRA 510, 519.
9 meet expenses for general operations, as well as costs
Country Bankers Insurance Corporation v. Lianga
Bay and Community Multi-Purpose Cooperative,
Inc.,G.R. No. 136914, January 25, 2002, 374 SCRA
653.
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 165443 April 16, 2009
CALATAGAN GOLF CLUB, INC. Petitioner,
vs.
SIXTO CLEMENTE, JR., Respondent.
DECISION
TINGA, J.:
Seeking the reversal of the Decision1 dated 1 June
2004 of the Court of Appeals in CA-G.R. SP No. 62331
and the reinstatement of the Decision dated 15
November 2000 of the Securities and Exchange
Commission (SEC) in SEC Case No. 04-98-5954,
petitioner Calatagan Golf Club, Inc. (Calatagan) filed
this Rule 45 petition against respondent Sixto
The key facts are undisputed.
Clemente applied to purchase one share of stock of
Calatagan, indicating in his application for membership
his mailing address at "Phimco Industries, Inc. – P.O.
Box 240, MCC," complete residential address, office
and residence telephone numbers, as well as the
company (Phimco) with which he was connected,
Calatagan issued to him Certificate of Stock No. A-
01295 on 2 May 1990 after paying P120,000.00 for the
share.2
Calatagan charges monthly dues on its members to
for upkeep and improvement of the grounds and
facilities. The provision on monthly dues is
incorporated in Calatagan’s Articles of Incorporation
and By-Laws. It is also reproduced at the back of each
certificate of stock.3As reproduced in the dorsal side of
Certificate of Stock No. A-01295, the provision reads:
5. The owners of shares of stock shall be subject to the
payment of monthly dues in an amount as may be
prescribed in the by-laws or by the Board of Directors
which shall in no case be less that [sic] P50.00 to meet
the expenses for the general operations of the club,
and the maintenance and improvement of its premises
and facilities, in addition to such fees as may be
charged for the actual use of the facilities x x x
When Clemente became a member the monthly
charge stood at P400.00. He paid P3,000.00 for his
monthly dues on 21 March 1991 and
another P5,400.00 on 9 December 1991. Then he
ceased paying the dues. At that point, his balance
amounted to P400.00.4
104
Ten (10) months later, Calatagan made the initial step
to collect Clemente’s back accounts by sending a
demand letter dated 21 September 1992. It was
followed by a second letter dated 22 October 1992.
Both letters were sent to Clemente’s mailing address
as indicated in his membership application but were
sent back to sender with the postal note that the
address had been closed.5
Calatagan declared Clemente delinquent for having
failed to pay his monthly dues for more than sixty (60)
days, specifically P5,600.00 as of 31 October 1992.
Calatagan also included Clemente’s name in the list of
delinquent members posted on the club’s bulletin
board. On 1 December 1992, Calatagan’s board of
directors adopted a resolution authorizing the
foreclosure of shares of delinquent members, including
Clemente’s; and the public auction of these shares.
On 7 December 1992, Calatagan sent a third and final
letter to Clemente, this time signed by its Corporate
Secretary, Atty. Benjamin Tanedo, Jr. The letter
contains a warning that unless Clemente settles his
outstanding dues, his share would be included among
the delinquent shares to be sold at public auction on 15
January 1993. Again, this letter was sent to Clemente’s
mailing address that had already been closed.6
On 5 January 1993, a notice of auction sale was posted
on the Club’s bulletin board, as well as on the club’s
premises. The auction sale took place as scheduled on
15 January 1993, and Clemente’s share sold
forP64,000.7 According to the Certificate of Sale issued
by Calatagan after the sale, Clemente’s share was
purchased by a Nestor A. Virata.8 At the time of the
sale, Clemente’s accrued monthly dues amounted
toP5,200.00.9 A notice of foreclosure of Clemente’s
share was published in the 26 May 1993 issue of the
Business World.10
Clemente learned of the sale of his share only in
November of 1997.11 He filed a claim with the
Securities and Exchange Commission (SEC) seeking
the restoration of his shareholding in Calatagan with
damages.
On 15 November 2000, the SEC rendered a decision
dismissing Clemente’s complaint. Citing Section 69 of
the Corporation Code which provides that the sale of
shares at an auction sale can only be questioned within
six (6) months from the date of sale, the SEC
concluded that Clemente’s claim, filed four (4) years
after the sale, had already prescribed. The SEC further
held that Calatagan had complied with all the
requirements for a valid sale of the subject share,
Clemente having failed to inform Calatagan that the
address he had earlier supplied was no longer his
address. Clemente, the SEC ruled, had acted in bad
faith in assuming as he claimed that his non-payment
of monthly dues would merely render his share
"inactive."
Clemente filed a petition for review with the Court of
Appeals. On 1 June 2004, the Court of Appeals
promulgated a decision reversing the SEC. The
appellate court restored Clemente’s one share with a
directive to Calatagan to issue in his a new share, and
awarded to Clemente a total of P400,000.00 in
damages, less the unpaid monthly dues of P5,200.00.
In rejecting the SEC’s finding that the action had
prescribed, the Court of Appeals cited the SEC’s own
ruling in SEC Case No. 4160, Caram v. Valley Golf
Country Club, Inc., that Section 69 of the Corporation
Code specifically refers to unpaid subscriptions to
capital stock, and not to any other debt of stockholders.
With the insinuation that Section 69 does not apply to
unpaid membership dues in non-stock corporations,
the appellate court employed Article 1140 of the Civil
Code as the proper rule of prescription. The provision
sets the prescription period of actions to recover
movables at eight (8) years.
The Court of Appeals also pointed out that since that
Calatagan’s first two demand letters had been returned
to it as sender with the notation about the closure of the
mailing address, it very well knew that its third and final
demand letter also sent to the same mailing address
would not be received by Clemente. It noted the by-law
requirement that within ten (10) days after the Board
has ordered the sale at auction of a member’s share of
stock for indebtedness, the Corporate Secretary shall
notify the owner thereof and advise the Membership
Committee of such fact. Finally, the Court of Appeals
ratiocinated that "a person who is in danger of the
imminent loss of his property has the right to be notified
and be given the chance to prevent the loss."12
Hence, the present appeal.
Calatagan maintains that the action of Clemente had
prescribed pursuant to Section 69 of the Corporation
Code, and that the requisite notices under both the law
and the by-laws had been rendered to Clemente.
Section 69 of the Code provides that an action to
recover delinquent stock sold must be commenced by
the filing of a complaint within six (6) months from the
date of sale. As correctly pointed out by the Court of
Appeals, Section 69 is part of Title VIII of the Code
entitled "Stocks and Stockholders" and refers
specifically to unpaid subscriptions to capital stock, the
sale of which is governed by the immediately preceding
Section 68.
The Court of Appeals debunked both Calatagan’s and
the SEC’s reliance on Section 69 by citing another SEC
ruling in the case of Caram v. Valley Golf. In connection
with Section 69, Calatagan raises a peripheral point
made in the SEC’s Caram ruling. In Caram, the SEC,
using as take-off Section 6 of the Corporation Code
which refers to "such rights, privileges or restrictions as
may be stated in the articles of incorporation," pointed
out that the Articles of Incorporation of Valley Golf does
not "impose any lien, liability or restriction on the Golf
Share [of Caram]," but only its (Valley Golf’s) By-Laws
does. Here, Calatagan stresses that its own Articles of
Incorporation does provide that the monthly dues
assessed on owners of shares of the corporation,
along with all other obligations of the shareholders to
the club, "shall constitute a first lien on the shares…
and in the event of delinquency such shares may be
ordered sold by the Board of Directors in the manner
provided in the By-Laws to satisfy said dues or other
obligations of the shareholders."13 With its illative but
incomprehensible logic, Calatagan concludes that the
prescriptive period under Section 69 should also apply
to the sale of Clemente’s share as the lien that
Calatagan perceives to be a restriction is stated in the
articles of incorporation and not only in the by-laws.
We remain unconvinced.
There are fundamental differences that defy
equivalence or even analogy between the sale of
delinquent stock under Section 68 and the sale that
occurred in this case. At the root of the sale of
delinquent stock is the non-payment of the subscription
price for the share of stock itself. The stockholder or
subscriber has yet to fully pay for the value of the share
105
or shares subscribed. In this case, Clemente had
already fully paid for the share in Calatagan and no
longer had any outstanding obligation to deprive him of
full title to his share. Perhaps the analogy could have
been made if Clemente had not yet fully paid for his
share and the non-stock corporation, pursuant to an
article or by-law provision designed to address that
situation, decided to sell such share as a consequence.
But that is not the case here, and there is no purpose
for us to apply Section 69 to the case at bar.
Calatagan argues in the alternative that Clemente’s
suit is barred by Article 1146 of the Civil Code which
establishes four (4) years as the prescriptive period for
actions based upon injury to the rights of the plaintiff on
the hypothesis that the suit is purely for damages. As a
second alternative still, Calatagan posits that
Clemente’s action is governed by Article 1149 of the
Civil Code which sets five (5) years as the period of
prescription for all other actions whose prescriptive
periods are not fixed in the Civil Code or in any other
law. Neither article is applicable but Article 1140 of the
Civil Code which provides that an action to recover
movables shall prescribe in eight (8) years.
Calatagan’s action is for the recovery of a share of
stock, plus damages.
Calatagan’s advertence to the fact that the constitution
of a lien on the member’s share by virtue of the explicit
provisions in its Articles of Incorporation and By-Laws
is relevant but ultimately of no help to its cause.
Calatagan’s Articles of Incorporation states that the
"dues, together with all other obligations of members to
the club, shall constitute a first lien on the shares,
second only to any lien in favor of the national or local
government, and in the event of delinquency such
shares may be ordered sold by the Board of Directors
in the manner provided in the By-Laws to satisfy said
dues or other obligations of the stockholders."14 In turn,
there are several provisions in the By-laws that govern
the payment of dues, the lapse into delinquency of the
member, and the constitution and execution on the
lien. We quote these provisions:
ARTICLE XII – MEMBER’S ACCOUNT
SEC. 31. (a) Billing Members, Posting of Delinquent
Members – The Treasurer shall bill al members
monthly. As soon as possible after the end of every
month, a statement showing the account of bill of a
member for said month will be prepared and sent to
him. If the bill of any member remains unpaid by the
20th of the month following that in which the bill was
incurred, the Treasurer shall notify him that if his bill is
not paid in full by the end of the succeeding month his
name will be posted as delinquent the following day at
the Clubhouse bulletin board. While posted, a member,
the immediate members of his family, and his guests,
may not avail of the facilities of the Club.
(b) Members on the delinquent list for more than 60
days shall be reported to the Board and their shares or
the shares of the juridical entities they represent shall
thereafter be ordered sold by the Board at auction to
satisfy the claims of the Club as provided for in Section
32 hereon. A member may pay his overdue account at
any time before the auction sale.
Sec. 32. Lien on Shares; Sale of Share at Auction- The
club shall have a first lien on every share of stock to
secure debts of the members to the Club. This lien shall
be annotated on the certificates of stock and may be
enforced by the Club in the following manner:
(a) Within ten (10) days after the Board has ordered the
sale at auction of a member’s share of stock for
indebtedness under Section 31(b) hereof, the
Secretary shall notify the owner thereof, and shall
advise the Membership Committee of such fact.
(b) The Membership Committee shall then notify all
applicants on the Waiting List and all registered
stockholders of the availability of a share of stock for
sale at auction at a specified date, time and place, and
shall post a notice to that effect in the Club bulletin
board for at least ten (10) days prior to the auction sale.
(c) On the date and hour fixed, the Membership
Committee shall proceed with the auction by viva voce
bidding and award the sale of the share of stock to the
highest bidder.
(d) The purchase price shall be paid by the winning
bidder to the Club within twenty-four (24) hours after
the bidding. The winning bidder or the representative
in the case of a juridical entity shall become a Regular
Member upon payment of the purchase price and
issuance of a new stock certificate in his name or in the
name of the juridical entity he represents. The
proceeds of the sale shall be paid by the Club to the
selling stockholder after deducting his obligations to
the Club.
(e) If no bids be received or if the winning bidder fails
to pay the amount of this bid within twenty-four (24)
hours after the bidding, the auction procedures may be
repeated from time to time at the discretion of the
Membership Committee until the share of stock be
sold.
(f) If the proceeds from the sale of the share of stock
are not sufficient to pay in full the indebtedness of the
member, the member shall continue to be obligated to
the Club for the unpaid balance. If the member whose
share of stock is sold fails or refuse to surrender the
stock certificate for cancellation, cancellation shall be
effected in the books of the Club based on a record of
the proceedings. Such cancellation shall render the
unsurrendered stock certificate null and void and notice
to this effect shall be duly published.
It is plain that Calatagan had endeavored to install a
clear and comprehensive procedure to govern the
payment of monthly dues, the declaration of a member
as delinquent, and the constitution of a lien on the
shares and its eventual public sale to answer for the
member’s debts. Under Section 91 of the Corporation
Code, membership in a non-stock corporation "shall be
terminated in the manner and for the causes provided
in the articles of incorporation or the by-laws." The By-
law provisions are elaborate in explaining the manner
and the causes for the termination of membership in
Calatagan, through the execution on the lien of the
share. The Court is satisfied that the By-Laws, as
written, affords due protection to the member by
assuring that the member should be notified by the
Secretary of the looming execution sale that would
terminate membership in the club. In addition, the By-
Laws guarantees that after the execution sale, the
proceeds of the sale would be returned to the former
member after deducting the outstanding obligations. If
followed to the letter, the termination of membership
under this procedure outlined in the By-Laws would
accord with substantial justice.
Yet, did Calatagan actually comply with the by-law
provisions when it sold Clemente’s share? The
appellate court’s finding on this point warrants our
approving citation, thus:
106
In accordance with this provision, Calatagan sent the
third and final demand letter to Clemente on December
7, 1992. The letter states that if the amount of
delinquency is not paid, the share will be included
among the delinquent shares to be sold at public
auction. This letter was signed by Atty. Benjamin
Tanedo, Jr., Calatagan Golf’s Corporate Secretary. It
was again sent to Clemente’s mailing address –
Phimco Industries Inc., P.O. Box 240, MCC
Makati. As expected, it was returned because the post
office box had been closed.
Under the By-Laws, the Corporate Secretary is tasked
to "give or cause to be given, all notices required by
law or by these By-Laws. .. and … keep a record of the
addresses of all stockholders. As quoted above, Sec.
32 (a) of the By-Laws further provides that "within ten
(10) days after the Board has ordered the sale at
auction of a member’s share of stock for indebtedness
under Section 31 (b) hereof, the Secretary shall notify
the owner thereof and shall advise the Membership
Committee of such fact.," The records do not disclose
what report the Corporate Secretary transmitted to the
Membership Committee to comply with Section 32(a).
Obviously, the reason for this mandatory requirement
is to give the Membership Committee the opportunity
to find out, before the share is sold, if proper notice has
been made to the shareholder member.
We presume that the Corporate Secretary, as a lawyer
is knowledgeable on the law and on the standards of
good faith and fairness that the law requires. As
custodian of corporate records, he should also have
known that the first two letters sent to Clemente were
returned because the P.O. Box had been closed. Thus,
we are surprised – given his knowledge of the law and
of corporate records – that he would send the third and
final letter – Clemente’s last chance before his share is
sold and his membership lost – to the same P.O. Box
that had been closed.
Calatagan argues that it "exercised due diligence
before the foreclosure sale" and "sent several notices
to Clemente’s specified mailing address." We do not
agree; we cannot label as due diligence Calatagan’s
act of sending the December 7, 1992 letter to
Clemente’s mailing address knowing fully well that the
P.O. Box had been closed. Due diligence or good faith
imposes upon the Corporate Secretary – the chief
repository of all corporate records – the obligation to
check Clemente’s other address which, under the By-
Laws, have to be kept on file and are in fact on file. One
obvious purpose of giving the Corporate Secretary the
duty to keep the addresses of members on file is
specifically for matters of this kind, when the member
cannot be reached through his or her mailing address.
Significantly, the Corporate Secretary does not have to
do the actual verification of other addressees on
record; a mere clerk can do the very simple task of
checking the files as in fact clerks actually undertake
these tasks. In fact, one telephone call to Clemente’s
phone numbers on file would have alerted him of his
impending loss.
Ultimately, the petition must fail because Calatagan
had failed to duly observe both the spirit and letter of
its own by-laws. The by-law provisions was clearly
conceived to afford due notice to the delinquent
member of the impending sale, and not just to provide
an intricate façade that would facilitate Calatagan’s
sale of the share. But then, the bad faith on Calatagan’s
part is palpable. As found by the Court of Appeals,
Calatagan very well knew that Clemente’s postal box
to which it sent its previous letters had already been
closed, yet it persisted in sending that final letter to the
same postal box. What for? Just for the exercise, it
appears, as it had known very well that the letter would
never actually reach Clemente.1avvphi1
It is noteworthy that Clemente in his membership
application had provided his residential address along
with his residence and office telephone numbers.
Nothing in Section 32 of Calatagan’s By-Laws requires
that the final notice prior to the sale be made solely
through the member’s mailing address. Clemente cites
our aphorism-like pronouncement in Rizal Commercial
Banking Corporation v. Court of Appeals15 that "[a]
simple telephone call and an ounce of good faith x x x
could have prevented this present controversy." That
memorable observation is quite apt in this case.
Calatagan’s bad faith and failure to observe its own By-
Laws had resulted not merely in the loss of Clemente’s
privilege to play golf at its golf course and avail of its
amenities, but also in significant pecuniary damage to
him. For that loss, the only blame that could be thrown
Clemente’s way was his failure to notify Calatagan of
the closure of the P.O. Box. That lapse, if we uphold
Calatagan would cost Clemente a lot. But, in the first
place, does he deserve answerability for failing to notify
the club of the closure of the postal box? Indeed,
knowing as he did that Calatagan was in possession of
his home address as well as residence and office
telephone numbers, he had every reason to assume
that the club would not be at a loss should it need to
contact him. In addition, according to Clemente, he
was not even aware of the closure of the postal box,
the maintenance of which was not his responsibility but
his employer Phimco’s.
The utter bad faith exhibited by Calatagan brings into
operation Articles 19, 20 and 21 of the Civil
Code,16 under the Chapter on Human Relations.
These provisions, which the Court of Appeals did
apply, enunciate a general obligation under law for
every person to act fairly and in good faith towards one
another. A non-stock corporation like Calatagan is not
exempt from that obligation in its treatment of its
members. The obligation of a corporation to treat every
person honestly and in good faith extends even to its
shareholders or members, even if the latter find
themselves contractually bound to perform certain
obligations to the corporation. A certificate of stock
cannot be a charter of dehumanization.
We turn to the matter of damages. The award of actual
damages is of course warranted since Clemente has
sustained pecuniary injury by reason of Calatagan’s
wrongful violation of its own By-Laws. It would not be
feasible to deliver Clemente’s original Certificate of
Stock because it had already been cancelled and a
new one issued in its place in the name of the
purchases at the auction who was not impleaded in this
case. However, the Court of Appeals instead directed
that Calatagan to issue to Clemente a new certificate
of stock. That sufficiently redresses the actual
damages sustained by Clemente. After all, the
certificate of stock is simply the evidence of the share.
The Court of Appeals also awarded
Clemente P200,000.00 as moral
damages, P100,000.00 as exemplary damages,
and P100,000.00 as attorney’s fees. We agree that the
award of such damages is warranted.
The Court of Appeals cited Calatagan for violation of
Article 32 of the Civil Code, which allows recovery of
damages from any private individual "who directly or
indirectly obstructs, defeats, violates or in any manner
impedes or impairs" the right "against deprivation of
107
property without due process of laws." The plain letter
of the provision squarely entitles Clemente to damages
from Calatagan. Even without Article 32 itself,
Calatagan will still be bound to pay moral and
exemplary damages to Clemente. The latter was able
to duly prove that he had sustained mental anguish,
serious anxiety and wounded feelings by reason of
Calatagan’s acts, thereby entitling him to moral
damages under Article 2217 of the Civil Code.
Moreover, it is evident that Calatagan’s bad faith as
exhibited in the
Pursuant to Section 13, Article VIII of the Constitution,
and the Division Chairperson’s Attestation, it is hereby
certified that the conclusions in the above Decision
had been reached in consultation before the case was
assigned to the writer of the opinion of the Court’s
Division.
REYNATO S. PUNO
Chief Justice
justice, give everyone his due, and observe honesty
and good faith.
Art. 20. Every person who, contrary to law, willfully or
negligently causes damage to another, shall indemnify
the latter for the same.
Art. 21. Any person who willfully causes loss or injury
to another in a manner that is contrary to morals, good
customs or public policy shall compensate the latter for
the damage.

course of its corporate actions warrants correction for Footnotes

the public good, thereby justifying exemplary damages *Justice
under Article 2229 of the Civil Code. Consuelo Ynares-Santiago as Raffle dated
April 13, 2009 as additional member in lieu of Justice
WHEREFORE, the petition is DENIED. The Decision Antonio D. Brion who inhibited himself in this case.
of the Court of Appeals is AFFIRMED. Costs against 1
petitioner. Rollo, pp. 47-64; Penned by Associate Justice Arturo
D. Brion (now a member of this Court, with Associate
SO ORDERED. Justices Ruben T. Reyes (later appointed to and retired
from this Court) and Eliezer de los Santos, concurring.
DANTE O. TINGA
2
Associate Justice Rollo, pp. 47-48, 145.
3
WE CONCUR: Id at 48, 145.
4
LEONARDO A. QUISUMBING Id. at 48, 145-146.
Associate Justice 5
Chairperson Id. at 48, 146.
6 Id. at 48-49, 146-147.
CONSUELO YNARES- CONCHITA CARPIO
SANTIAGO MORALES 7 Rollo, p. 49.
Associate Justice Associate Justice
8 Records, p. 250.
PRESBITERO J. VELASCO, JR.*
Associate Justice 9 Id.

ATTESTATION 10 Records, p. 250.

I attest that the conclusions in the above Decision had 11 Rollo, pp. 49, 147.
been reached in consultation before the case was
12
assigned to the writer of the opinion of the Court’s Id. at 13.
Division. 13 Rollo, p. 20.
LEONARDO A. QUISUMBING 14 See rollo, pp. 79-80.
Associate Justice
Chairperson, Second Division 15 G.R. No. 133107, 25 March 1999, 305 SCRA 449.
CERTIFICATION 16 Art. 19. Every person must in the exercise of his
rights and in the performance of his duties, act with

108
 SPOUSES JAVIER AND MA. THERESA
PASTORFIDE, CAGAYAN DE ORO WATER
DISTRICT AND GASPAR
GONZALEZ,* JR., RESPONDENTS.

DECISION

PERALTA, J.:

Before the Court is a petition for review on certiorari

under Rule 45 of the Rules of Court seeking to reverse
and set aside the Decision1 and Resolution2 of the
Court of Appeals (CA), dated August 28, 2003 and
December 17, 2003, respectively, in CA-G.R. CV No.
73000. The CA Decision affirmed with modification the
August 15, 2001 Decision3 of the Regional Trial Court
(RTC) of Cagayan de Oro City, Branch 24, while the
CA Resolution denied petitioner's Motion for
Reconsideration.

The facts, as summarized by the CA, are as follows:

[Herein petitioner] Joyce V. Ardiente and her husband

Dr. Roberto S. Ardiente are owners of a housing unit at
Emily Homes, Balulang, Cagayan de Oro City with a lot
area of one hundred fifty-three (153) square meters
and covered by Transfer Certificate of Title No. 69905.

On June 2, 1994, Joyce Ardiente entered into a

Memorandum of Agreement (Exh. "B", pp. 470-473,
Records) selling, transferring and conveying in favor of
[respondent] Ma. Theresa Pastorfide all their rights and
interests in the housing unit at Emily Homes in
consideration of P70,000.00. The Memorandum of
Agreement carries a stipulation:

"4. That the water and power bill of the subject property
shall be for the account of the Second Party (Ma.
Theresa Pastorfide) effective June 1, 1994." (Records,
p. 47)

Republic of the Philippines vis-a-vis Ma. Theresa Pastorfide's assumption of the

SUPREME COURT payment of the mortgage loan secured by Joyce
Manila Ardiente from the National Home Mortgage (Records,
Exh. "A", pp. 468-469)
THIRD DIVISION
For four (4) years, Ma. Theresa's use of the water
G.R. No. 161921 July 17, 2013 connection in the name of Joyce Ardiente was never
questioned nor perturbed (T.S.N., October 31, 2000,
JOYCE V. ARDIENTE, PETITIONER, pp. 7-8) until on March 12, 1999, without notice, the
vs. water connection of Ma. Theresa was cut off.

109
Proceeding to the office of the Cagayan de Oro Water
District (COWD) to complain, a certain Mrs. Madjos
told Ma. Theresa that she was delinquent for three (3)
months corresponding to the months of December
1998, January 1999, and February 1999. Ma. Theresa
argued that the due date of her payment was March
18, 1999 yet (T.S.N., October 31, 2000, pp. 11-12).
Mrs. Madjos later told her that it was at the instance of
Joyce Ardiente that the water line was cut off (T.S.N.,
February 5, 2001, p. 31).
On March 15, 1999, Ma. Theresa paid the delinquent
bills (T.S.N., October 31, 2000, p. 12). On the same
date, through her lawyer, Ma. Theresa wrote a letter to
the COWD to explain who authorized the cutting of the
water line (Records, p. 160).
On March 18, 1999, COWD, through the general
manager, [respondent] Gaspar Gonzalez, Jr.,
answered the letter dated March 15, 1999 and
reiterated that it was at the instance of Joyce Ardiente
that the water line was cut off (Records, p. 161).
Aggrieved, on April 14, 1999, Ma. Theresa Pastorfide
[and her husband] filed [a] complaint for damages
[against petitioner, COWD and its manager Gaspar
Gonzalez] (Records, pp. 2-6).
In the meantime, Ma. Theresa Pastorfide's water line
was only restored and reconnected when the [trial]
court issued a writ of preliminary mandatory injunction
on December 14, 1999 (Records, p. 237).4
After trial, the RTC rendered judgment holding as
follows:
xxxx
In the exercise of their rights and performance of their
duties, defendants did not act with justice, gave
plaintiffs their due and observe honesty and good faith.
Before disconnecting the water supply, defendants
COWD and Engr. Gaspar Gonzales did not even send
a disconnection notice to plaintiffs as testified to by
Engr. Bienvenido Batar, in-charge of the Commercial
Department of defendant COWD. There was one
though, but only three (3) days after the actual
disconnection on March 12, 1999. The due date for
payment was yet on March 15. Clearly, they did not act
with justice. Neither did they observe honesty.
They should not have been swayed by the prodding of
Joyce V. Ardiente. They should have investigated first
as to the present ownership of the house. For doing the
act because Ardiente told them, they were negligent.
Defendant Joyce Ardiente should have requested
before the cutting off of the water supply, plaintiffs to
pay. While she attempted to tell plaintiffs but she did
not have the patience of seeing them. She knew that it
was plaintiffs who had been using the water four (4)
years ago and not hers. She should have been very
careful. x x x5
The dispositive portion of the trial court's Decision
reads, thus:
WHEREFORE, premises considered, judgment is
hereby rendered ordering defendants [Ardiente,
COWD and Gonzalez] to pay jointly and severally
plaintiffs, the following sums:
(a) P200,000.00 for moral damages;
(b) 200,000.00 for exemplary damages; and
(c) 50,000.00 for attorney's fee.
The cross-claim of Cagayan de Oro Water District and
Engr. Gaspar Gonzales is hereby dismissed. The
Court is not swayed that the cutting off of the water
supply of plaintiffs was because they were influenced
by defendant Joyce Ardiente. They were negligent too
for which they should be liable.
SO ORDERED.6
Petitioner, COWD and Gonzalez filed an appeal with
the CA.
On August 28, 2003, the CA promulgated its assailed
Decision disposing as follows:
IN VIEW OF ALL THE FOREGOING, the appealed
decision is AFFIRMED, with the modification that the
awarded damages is reduced to P100,000.00 each for
moral and exemplary damages, while attorney's fees is
lowered toP25,000.00. Costs against appellants.
SO ORDERED.7
The CA ruled, with respect to petitioner, that she has a
"legal duty to honor the possession and use of water
line by Ma. Theresa Pastorfide pursuant to their
Memorandum of Agreement" and "that when
[petitioner] applied for its disconnection, she acted in
bad faith causing prejudice and [injury to] Ma. Theresa
Pastorfide."8
As to COWD and Gonzalez, the CA held that they
"failed to give a notice of disconnection and derelicted
in reconnecting the water line despite payment of the
unpaid bills by the [respondent spouses Pastorfide]." 9
Petitioner, COWD and Gonzalez filed their respective
Motions for Reconsideration, but these were denied by
the CA in its Resolution dated December 17, 2003.
COWD and Gonzalez filed a petition for review on
certiorari with this Court, which was docketed as G.R.
No. 161802. However, based on technical grounds and
on the finding that the CA did not commit any reversible
error in its assailed Decision, the petition was denied
via a Resolution10 issued by this Court on March 24,
2004. COWD and Gonzalez filed a motion for
reconsideration, but the same was denied with finality
through this Court's Resolution11 dated June 28, 2004.
Petitioner, on the other hand, timely filed the instant
petition with the following Assignment of Errors:
7.1 HONORABLE COURT OF APPEALS
(ALTHOUGH IT HAS REDUCED THE LIABILITY INTO
HALF) HAS STILL COMMITTED GRAVE AND
SERIOUS ERROR WHEN IT UPHELD THE JOINT
AND SOLIDARY LIABILITY OF PETITIONER JOYCE
V. ARDIENTE WITH CAGAYAN DE ORO WATER
DISTRICT (COWD) AND ENGR. GASPAR D.
GONZALES FOR THE LATTER'S FAILURE TO
SERVE NOTICE UPON RESPONDENTS SPOUSES
PASTORFIDE PRIOR TO THE ACTUAL
DISCONNECTION DESPITE EVIDENCE ADDUCED
DURING TRIAL THAT EVEN WITHOUT
PETITIONER'S REQUEST, COWD WAS ALREADY
SET TO EFFECT DISCONNECTION OF
RESPONDENTS' WATER SUPPLY DUE TO NON-
PAYMENT OF ACCOUNT FOR THREE (3) MONTHS.
7.2 THE HONORABLE COURT OF APPEALS
COMMITTED GRAVE AND SERIOUS ERROR WHEN
IT RULED TOTALLY AGAINST PETITIONER AND
FAILED TO FIND THAT RESPONDENTS ARE
GUILTY OF CONTRIBUTORY NEGLIGENCE WHEN
THEY FAILED TO PAY THEIR WATER BILLS FOR
110
THREE MONTHS AND TO MOVE FOR THE
TRANSFER OF THE COWD ACCOUNT IN THEIR
NAME, WHICH WAS A VIOLATION OF THEIR
MEMORANDUM OF AGREEMENT WITH
PETITIONER JOYCE V. ARDIENTE.
RESPONDENTS LIKEWISE DELIBERATELY FAILED
TO EXERCISE DILIGENCE OF A GOOD FATHER OF
THE FAMILY TO MINIMIZE THE DAMAGE UNDER
ART. 2203 OF THE NEW CIVIL CODE.
7.3 THE HONORABLE COURT OF APPEALS
SERIOUSLY ERRED WHEN IT DISREGARDED THE
FACT THAT RESPONDENT SPOUSES
PASTORFIDE ARE LIKEWISE BOUND TO
OBSERVE ARTICLE 19 OF THE NEW CIVIL CODE,
i.e., IN THE EXERCISE OF THEIR RIGHTS AND IN
THE PERFORMANCE OF THEIR DUTIES TO ACT
WITH JUSTICE, GIVE EVERYONE HIS DUE AND
OBSERVE HONESTY AND GOOD FAITH.
7.4 THE HONORABLE COURT OF APPEALS
GRAVELY ERRED WHEN IT GRANTED AN AWARD
OF MORAL AND EXEMPLARY DAMAGES AND
ATTORNEY'S FEES AS AGAINST PETITIONER
ARDIENTE.12
At the outset, the Court noticed that COWD and
Gonzalez, who were petitioner's co-defendants before
the RTC and her co-appellants in the CA, were
impleaded as respondents in the instant petition. This
cannot be done. Being her co-parties before the RTC
and the CA, petitioner cannot, in the instant petition for
review on certiorari, make COWD and Gonzalez,
adversary parties. It is a grave mistake on the part of
petitioner's counsel to treat COWD and Gonzalez as
respondents. There is no basis to do so, considering
that, in the first place, there is no showing that
petitioner filed a cross-claim against COWD and
Gonzalez. Under Section 2, Rule 9 of the Rules of
Court, a cross-claim which is not set up shall be barred.
Thus, for failing to set up a cross-claim against COWD
and Gonzalez before the RTC, petitioner is already
barred from doing so in the present petition.
More importantly, as shown above, COWD and
Gonzalez's petition for review on certiorari filed with
this Court was already denied with finality on June 28,
2004, making the presently assailed CA Decision final
and executory insofar as COWD and Gonzalez are
concerned. Thus, COWD and Gonzalez are already
precluded from participating in the present petition.
They cannot resurrect their lost cause by filing
pleadings this time as respondents but, nonetheless,
reiterating the same prayer in their previous pleadings
filed with the RTC and the CA.
As to the merits of the instant petition, the Court
likewise noticed that the main issues raised by
petitioner are factual and it is settled that the resolution
of factual issues is the function of lower courts, whose
findings on these matters are received with respect and
considered binding by the Supreme Court subject only
to certain exceptions, none of which is present in this
instant petition.13 This is especially true when the
findings of the RTC have been affirmed by the CA as
in this case.14
In any case, a perusal of the records at hand would
readily show that the instant petition lacks merit.
Petitioner insists that she should not be held liable for
the disconnection of respondent spouses' water
supply, because she had no participation in the actual
disconnection. However, she admitted in the present
petition that it was she who requested COWD to
disconnect the Spouses Pastorfide's water supply.
This was confirmed by COWD and Gonzalez in their
cross-claim against petitioner. While it was COWD
which actually discontinued respondent spouses' water
supply, it cannot be denied that it was through the
instance of petitioner that the Spouses Pastorfide's
water supply was disconnected in the first place.
It is true that it is within petitioner's right to ask and even
require the Spouses Pastorfide to cause the transfer of
the former's account with COWD to the latter's name
pursuant to their Memorandum of Agreement.
However, the remedy to enforce such right is not to
cause the disconnection of the respondent spouses'
water supply. The exercise of a right must be in
accordance with the purpose for which it was
established and must not be excessive or unduly
harsh; there must be no intention to harm
another.15 Otherwise, liability for damages to the
injured party will attach.16 In the present case, intention
to harm was evident on the part of petitioner when she
requested for the disconnection of respondent
spouses’ water supply without warning or informing the
latter of such request. Petitioner claims that her request
for disconnection was based on the advise of COWD
personnel and that her intention was just to compel the
Spouses Pastorfide to comply with their agreement
that petitioner's account with COWD be transferred in
respondent spouses' name. If such was petitioner's
only intention, then she should have advised
respondent spouses before or immediately after
submitting her request for disconnection, telling them
that her request was simply to force them to comply
with their obligation under their Memorandum of
Agreement. But she did not. What made matters worse
is the fact that COWD undertook the disconnection
also without prior notice and even failed to reconnect
the Spouses Pastorfide’s water supply despite
payment of their arrears. There was clearly an abuse
of right on the part of petitioner, COWD and Gonzalez.
They are guilty of bad faith.
The principle of abuse of rights as enshrined in Article
19 of the Civil Code provides that every person must,
in the exercise of his rights and in the performance of
his duties, act with justice, give everyone his due, and
observe honesty and good faith.
In this regard, the Court's ruling in Yuchengco v. The
Manila Chronicle Publishing Corporation17 is
instructive, to wit:
xxxx
This provision of law sets standards which must be
observed in the exercise of one’s rights as well as in
the performance of its duties, to wit: to act with justice;
give everyone his due; and observe honesty and good
faith.
In Globe Mackay Cable and Radio Corporation v. Court
of Appeals, it was elucidated that while Article 19 "lays
down a rule of conduct for the government of human
relations and for the maintenance of social order, it
does not provide a remedy for its violation. Generally,
an action for damages under either Article 20 or Article
21 would be proper." The Court said:
One of the more notable innovations of the New Civil
Code is the codification of "some basic principles that
are to be observed for the rightful relationship between
human beings and for the stability of the social order."
[REPORT ON THE CODE COMMISSION ON THE
PROPOSED CIVIL CODE OF THE PHILIPPINES, p.
39]. The framers of the Code, seeking to remedy the
111
defect of the old Code which merely stated the effects
of the law, but failed to draw out its spirit, incorporated
certain fundamental precepts which were "designed to
indicate certain norms that spring from the fountain of
good conscience" and which were also meant to serve
as "guides for human conduct [that] should run as
golden threads through society, to the end that law may
approach its supreme ideal, which is the sway and
dominance of justice." (Id.) Foremost among these
principles is that pronounced in Article 19 x x x.
xxxx
This article, known to contain what is commonly
referred to as the principle of abuse of rights, sets
certain standards which must be observed not only in
the exercise of one's rights, but also in the performance
of one's duties. These standards are the following: to
act with justice; to give everyone his due; and to
observe honesty and good faith. The law, therefore,
recognizes a primordial limitation on all rights; that in
their exercise, the norms of human conduct set forth in
Article 19 must be observed. A right, though by itself
legal because recognized or granted by law as such,
may nevertheless become the source of some
illegality. When a right is exercised in a manner which
does not conform with the norms enshrined in Article
19 and results in damage to another, a legal wrong is
thereby committed for which the wrongdoer must be
held responsible. But while Article 19 lays down a rule
of conduct for the government of human relations and
for the maintenance of social order, it does not provide
a remedy for its violation. Generally, an action for
damages under either Article 20 or Article 21 would be
proper.
Corollarilly, Article 20 provides that "every person who,
contrary to law, willfully or negligently causes damage
to another shall indemnify the latter for the same." It
speaks of the general sanctions of all other provisions
of law which do not especially provide for its own
sanction. When a right is exercised in a manner which
does not conform to the standards set forth in the said
provision and results in damage to another, a legal
wrong is thereby committed for which the wrongdoer
must be responsible. Thus, if the provision does not
provide a remedy for its violation, an action for
damages under either Article 20 or Article 21 of the
Civil Code would be proper.
The question of whether or not the principle of abuse WHEREFORE, instant petition for review on certiorari
of rights has been violated resulting in damages under is DENIED. The Decision and Resolution of the Court
Article 20 or other applicable provision of law, depends of Appeals, dated August 28, 2003 and December 17,
on the circumstances of each case. x x x18 2003, respectively, in CA-G.R. CV No. 73000 are
AFFIRMED.
To recapitulate, petitioner's acts which violated the
abovementioned provisions of law is her unjustifiable SO ORDERED.
act of having the respondent spouses' water supply
disconnected, coupled with her failure to warn or at Velasco, Jr., (Chairperson), Abad, Mendoza, and
least notify respondent spouses of such intention. On Leonen, JJ., concur.
the part of COWD and Gonzalez, it is their failure to
July 24, 2013
give prior notice of the impending disconnection and
their subsequent neglect to reconnect respondent N O T I C E OF J U D G M E N T
spouses' water supply despite the latter's settlement of
their delinquent account. Sirs/Mesdames:
On the basis of the foregoing, the Court finds no cogent Please take notice that on ___July 17, 2013___ a
reason to depart from the ruling of both the RTC and Decision, copy attached herewith, was rendered by
the CA that petitioner, COWD and Gonzalez are the Supreme Court in the above-entitled case, the
solidarily liable. original of which was received by this Office on July
19, 2013 at 2:25 p.m.
The Spouses Pastorfide are entitled to moral damages
based on the provisions of Article 2219,19 in connection Very truly yours,
with Articles 2020 and 2121 of the Civil Code.
(SGD)
As for exemplary damages, Article 2229 provides that LUCITA ABJELINA SORIANO
exemplary damages may be imposed by way of Division Clerk of Court
example or correction for the public good.
Nonetheless, exemplary damages are imposed not to
enrich one party or impoverish another, but to serve as
a deterrent against or as a negative incentive to curb
Footnotes
socially deleterious actions.22 In the instant case, the
Court agrees with the CA in sustaining the award of * Spelled as Gonzales in other parts of the rollo and
exemplary damages, although it reduced the amount records.
granted, considering that respondent spouses were
deprived of their water supply for more than nine (9) 1Penned by Associate Justice Conrado M. Vasquez,
months, and such deprivation would have continued Jr., with Associate Justices Edgardo P. Cruz and Noel
were it not for the relief granted by the RTC. G. Tijam, concurring; rollo, pp. 60-67.
With respect to the award of attorney's fees, Article 2 Id. at 68.
2208 of the Civil Code provides, among others, that
3
such fees may be recovered when exemplary Penned by Judge Leonardo N. Demecillo, id. at 27-
damages are awarded, when the defendant's act or 37.
omission has compelled the plaintiff to litigate with third
4 Rollo, pp. 60-62.
persons or to incur expenses to protect his interest, and
where the defendant acted in gross and evident bad 5
Id. at 35-36.
faith in refusing to satisfy the plaintiffs’ plainly valid, just
and demandable claim. 6 Id. at 37.
7 Id. at 67. (Emphasis in the original)
112
8 Id. at 65. On 9 February 1981, petitioner Raul Sesbreño made a
money market placement in the amount of
9 Id. at 64. P300,000.00 with the Philippine Underwriters Finance
10 Corporation ("Philfinance"), Cebu Branch; the
Id. at 219.
placement, with a term of thirty-two (32) days, would
11 Id. at 220. mature on 13 March 1981, Philfinance, also on 9
February 1981, issued the following documents to
12 Id. at 14. petitioner:
13Philippine National Bank v. DKS International, Inc., (a) the Certificate of Confirmation of Sale, "without
G.R. No. 179161, January 22, 2010, 610 SCRA 603, recourse," No. 20496 of one (1) Delta Motors
621. Corporation Promissory Note ("DMC PN") No. 2731 for
a term of 32 days at 17.0% per annum;
14 Id.
(b) the Certificate of securities Delivery Receipt No.
15 Uypitching v. Quiamco, G.R. No. 146322, December 16587 indicating the sale of DMC PN No. 2731 to
6, 2006, 510 SCRA 172, 179. petitioner, with the notation that the said security was
16
in custodianship of Pilipinas Bank, as per Denominated
Id. Custodian Receipt ("DCR") No. 10805 dated 9
17G.R. No. 184315, November 28, 2011, 661 SCRA February 1981; and
392. (c) post-dated checks payable on 13 March 1981 (i.e.,
18 Id. at 402-404. (Emphasis supplied) the maturity date of petitioner's investment), with
petitioner as payee, Philfinance as drawer, and Insular
19 Art. 2219. Moral damages may be recovered in the Bank of Asia and America as drawee, in the total
following and analogous cases: amount of P304,533.33.
Republic of the Philippines
SUPREME COURT On 13 March 1981, petitioner sought to encash the
xxxx
Manila postdated checks issued by Philfinance. However, the
(10) Acts and actions referred to in Articles 21, 26, 27, checks were dishonored for having been drawn against
28. 29, 30, 32, 34 and 35. THIRD DIVISION
insufficient funds.
xxxx On 26 March 1981, Philfinance delivered to petitioner
G.R. No. 89252 May 24, 1993 the DCR No. 10805 issued by private respondent
20Every person who, contrary to law, willfully or Pilipinas Bank ("Pilipinas"). It reads as follows:
negligently causes damage to another, shall indemnify RAUL SESBREÑO, petitioner,
the latter for the same. vs. PILIPINAS BANK
21 HON. COURT OF APPEALS, DELTA MOTORS Makati Stock Exchange Bldg.,
Any person who willfully causes loss or injury to Ayala Avenue, Makati,
CORPORATION AND PILIPINAS
another in a manner that is contrary to morals, good Metro Manila
BANK, respondents.
customs or public policy shall compensate the latter for
the damage. Salva, Villanueva & Associates for Delta Motors February 9, 1981
Corporation. ———————
22Yuchengco v. The Manila Chronicle Publishing VALUE DATE
Corporation, supra note 17, at 405. Reyes, Salazar & Associates for Pilipinas Bank.
TO Raul Sesbreño

April 6, 1981
FELICIANO, J.: ————————
MATURITY DATE

113
NO. 10805
DENOMINATED CUSTODIAN RECEIPT
This confirms that as a duly Custodian Bank, and
upon instruction of PHILIPPINE UNDERWRITES
FINANCE CORPORATION, we have in our custody
the following securities to you [sic] the extent herein
indicated.
SERIAL MAT. FACE ISSUED REGISTERED
AMOUNT
NUMBER DATE VALUE BY HOLDER PAYEE
2731 4-6-81 2,300,833.34 DMC PHIL. 307,933.33
UNDERWRITERS
FINANCE CORP.
We further certify that these securities may be
inspected by you or your duly authorized
representative at any time during regular banking
hours.
Upon your written instructions we shall undertake
physical delivery of the above securities fully assigned
to you should this Denominated Custodianship
Receipt remain outstanding in your favor thirty (30)
days after its maturity.
PILIPINAS BANK
(By Elizabeth De Villa
Illegible Signature) 1
On 2 April 1981, petitioner approached Ms. Elizabeth
de Villa of private respondent Pilipinas, Makati Branch,
and handed her a demand letter informing the bank
that his placement with Philfinance in the amount
reflected in the DCR No. 10805 had remained unpaid
and outstanding, and that he in effect was asking for
the physical delivery of the underlying promissory note.
Petitioner then examined the original of the DMC PN
No. 2731 and found: that the security had been issued
on 10 April 1980; that it would mature on 6 April 1981;
that it had a face value of P2,300,833.33, with the
Philfinance as "payee" and private respondent Delta
Motors Corporation ("Delta") as "maker;" and that on
face of the promissory note was stamped "NON
NEGOTIABLE." Pilipinas did not deliver the Note, nor
any certificate of participation in respect thereof, to
petitioner.
Petitioner later made similar demand letters, dated 3
July 1981 and 3 August 1981, 2 again asking private
respondent Pilipinas for physical delivery of the original
of DMC PN No. 2731. Pilipinas allegedly referred all of
petitioner's demand letters to Philfinance for written
instructions, as has been supposedly agreed upon in
"Securities Custodianship Agreement" between
Pilipinas and Philfinance. Philfinance did not provide
the appropriate instructions; Pilipinas never released
DMC PN No. 2731, nor any other instrument in respect
thereof, to petitioner.
Petitioner also made a written demand on 14 July
1981 3 upon private respondent Delta for the partial
satisfaction of DMC PN No. 2731, explaining that
Philfinance, as payee thereof, had assigned to him said
Note to the extent of P307,933.33. Delta, however,
denied any liability to petitioner on the promissory note,
and explained in turn that it had previously agreed with
Philfinance to offset its DMC PN No. 2731 (along with
DMC PN No. 2730) against Philfinance PN No. 143-A
issued in favor of Delta.
In the meantime, Philfinance, on 18 June 1981, was
placed under the joint management of the Securities
and exchange commission ("SEC") and the Central
Bank. Pilipinas delivered to the SEC DMC PN No.
2731, which to date apparently remains in the custody
of the SEC. 4
As petitioner had failed to collect his investment and
interest thereon, he filed on 28 September 1982 an
action for damages with the Regional Trial Court
("RTC") of Cebu City, Branch 21, against private
respondents Delta and Pilipinas. 5 The trial court, in a
decision dated 5 August 1987, dismissed the complaint
and counterclaims for lack of merit and for lack of
cause of action, with costs against petitioner.
Petitioner appealed to respondent Court of Appeals in
C.A.-G.R. CV No. 15195. In a Decision dated 21 March
1989, the Court of Appeals denied the appeal and
held: 6
Be that as it may, from the evidence on record, if there
is anyone that appears liable for the travails of plaintiff-
appellant, it is Philfinance. As correctly observed by the
trial court:
This act of Philfinance in accepting the investment of
plaintiff and charging it against DMC PN No. 2731
when its entire face value was already obligated or
earmarked for set-off or compensation is difficult to
comprehend and may have been motivated with bad
faith. Philfinance, therefore, is solely and legally
obligated to return the investment of plaintiff, together
with its earnings, and to answer all the damages
plaintiff has suffered incident thereto. Unfortunately for
plaintiff, Philfinance was not impleaded as one of the
defendants in this case at bar; hence, this Court is
without jurisdiction to pronounce judgement against it.
(p. 11, Decision)
WHEREFORE, finding no reversible error in the
decision appealed from, the same is hereby affirmed in
toto. Cost against plaintiff-appellant.
Petitioner moved for reconsideration of the above
Decision, without success.
Hence, this Petition for Review on Certiorari.
After consideration of the allegations contained and
issues raised in the pleadings, the Court resolved to
give due course to the petition and required the parties
to file their respective memoranda. 7
Petitioner reiterates the assignment of errors he
directed at the trial court decision, and contends that
respondent court of Appeals gravely erred: (i) in
concluding that he cannot recover from private
respondent Delta his assigned portion of DMC PN No.
2731; (ii) in failing to hold private respondent Pilipinas
solidarily liable on the DMC PN No. 2731 in view of the
provisions stipulated in DCR No. 10805 issued in favor
r of petitioner, and (iii) in refusing to pierce the veil of
corporate entity between Philfinance, and private
respondents Delta and Pilipinas, considering that the
three (3) entities belong to the "Silverio Group of
Companies" under the leadership of Mr. Ricardo
Silverio, Sr. 8
There are at least two (2) sets of relationships which
we need to address: firstly, the relationship of
petitioner vis-a-visDelta; secondly, the relationship of
petitioner in respect of Pilipinas. Actually, of course,
there is a third relationship that is of critical importance:
the relationship of petitioner and Philfinance. However,
since Philfinance has not been impleaded in this case,
114
neither the trial court nor the Court of Appeals acquired
jurisdiction over the person of Philfinance. It is,
consequently, not necessary for present purposes to
deal with this third relationship, except to the extent it
necessarily impinges upon or intersects the first and
second relationships.
I.
We consider first the relationship between petitioner
and Delta.
The Court of appeals in effect held that petitioner
acquired no rights vis-a-vis Delta in respect of the
Delta promissory note (DMC PN No. 2731) which
Philfinance sold "without recourse" to petitioner, to the
extent of P304,533.33. The Court of Appeals said on
this point:
Nor could plaintiff-appellant have acquired any right
over DMC PN No. 2731 as the same is "non-
negotiable" as stamped on its face (Exhibit "6"),
negotiation being defined as the transfer of an
instrument from one person to another so as to
constitute the transferee the holder of the instrument
(Sec. 30, Negotiable Instruments Law). A person not a
holder cannot sue on the instrument in his own name
and cannot demand or receive payment (Section
51, id.) 9
Petitioner admits that DMC PN No. 2731 was non-
negotiable but contends that the Note had been validly
transferred, in part to him by assignment and that as a
result of such transfer, Delta as debtor-maker of the
Note, was obligated to pay petitioner the portion of that
Note assigned to him by the payee Philfinance.
Delta, however, disputes petitioner's contention and
argues:
(1) that DMC PN No. 2731 was not intended to be
negotiated or otherwise transferred by Philfinance as
manifested by the word "non-negotiable" stamp across
the face of the Note 10 and because maker Delta and
payee Philfinance intended that this Note would be
offset against the outstanding obligation of Philfinance
represented by Philfinance PN No. 143-A issued to
Delta as payee;
(2) that the assignment of DMC PN No. 2731 by
Philfinance was without Delta's consent, if not against
its instructions; and
(3) assuming (arguendo only) that the partial
assignment in favor of petitioner was valid, petitioner
took the Note subject to the defenses available to
Delta, in particular, the offsetting of DMC PN No. 2731
against Philfinance PN No. 143-A. 11
We consider Delta's arguments seriatim.
Firstly, it is important to bear in mind that
the negotiation of a negotiable instrument must be
distinguished from theassignment or transfer of an
instrument whether that be negotiable or non-
negotiable. Only an instrument qualifying as a
negotiable instrument under the relevant statute may
be negotiated either by indorsement thereof coupled
with delivery, or by delivery alone where the negotiable
instrument is in bearer form. A negotiable instrument
may, however, instead of being negotiated, also
be assigned or transferred. The legal consequences of
negotiation as distinguished from assignment of a
negotiable instrument are, of course, different. A non-
negotiable instrument may, obviously, not be
negotiated; but it may be assigned or transferred,
absent an express prohibition against assignment or
transfer written in the face of the instrument:
The words "not negotiable," stamped on the face of the
bill of lading, did not destroy its assignability, but the
sole effect was to exempt the bill from the statutory
provisions relative thereto, and a bill, though not
negotiable, may be transferred by assignment; the
assignee taking subject to the equities between the
original parties. 12 (Emphasis added)
DMC PN No. 2731, while marked "non-negotiable,"
was not at the same time stamped "non-transferable"
or "non-assignable." It contained no stipulation which
prohibited Philfinance from assigning or transferring, in
whole or in part, that Note.
Delta adduced the "Letter of Agreement" which it had
entered into with Philfinance and which should be
quoted in full:
April 10, 1980
Philippine Underwriters Finance Corp.
Benavidez St., Makati,
Metro Manila.
Attention: Mr. Alfredo O. Banaria
SVP-Treasurer
GENTLEMEN:
This refers to our outstanding placement of
P4,601,666.67 as evidenced by your Promissory Note
No. 143-A, dated April 10, 1980, to mature on April 6,
1981.
As agreed upon, we enclose our non-negotiable
Promissory Note No. 2730 and 2731 for P2,000,000.00
each, dated April 10, 1980, to be offsetted [sic] against
your PN No. 143-A upon co-terminal maturity.
Please deliver the proceeds of our PNs to our
representative, Mr. Eric Castillo.
Very Truly Yours,
(Sgd.)
Florencio B. Biagan
Senior Vice President 13
We find nothing in his "Letter of Agreement" which can
be reasonably construed as a prohibition upon
Philfinance assigning or transferring all or part of DMC
PN No. 2731, before the maturity thereof. It is scarcely
necessary to add that, even had this "Letter of
Agreement" set forth an explicit prohibition of transfer
upon Philfinance, such a prohibition cannot be invoked
against an assignee or transferee of the Note who
parted with valuable consideration in good faith and
without notice of such prohibition. It is not disputed that
petitioner was such an assignee or transferee. Our
conclusion on this point is reinforced by the fact that
what Philfinance and Delta were doing by their
exchange of their promissory notes was this: Delta
invested, by making a money market placement with
Philfinance, approximately P4,600,000.00 on 10 April
1980; but promptly, on the same day, borrowed back
the bulk of that placement, i.e., P4,000,000.00, by
issuing its two (2) promissory notes: DMC PN No. 2730
115
and DMC PN No. 2731, both also dated 10 April 1980.
Thus, Philfinance was left with not P4,600,000.00 but
only P600,000.00 in cash and the two (2) Delta
promissory notes.
Apropos Delta's complaint that the partial assignment
by Philfinance of DMC PN No. 2731 had been effected
without the consent of Delta, we note that such consent
was not necessary for the validity and enforceability of
the assignment in favor of petitioner. 14 Delta's
argument that Philfinance's sale or assignment of part
of its rights to DMC PN No. 2731 constituted
conventional subrogation, which required its (Delta's)
consent, is quite mistaken. Conventional subrogation,
which in the first place is never lightly inferred, 15 must
be clearly established by the unequivocal terms of the
substituting obligation or by the evident incompatibility
of the new and old obligations on every
point. 16 Nothing of the sort is present in the instant
case.
It is in fact difficult to be impressed with Delta's
complaint, since it released its DMC PN No. 2731 to
Philfinance, an entity engaged in the business of
buying and selling debt instruments and other
securities, and more generally, in money market
transactions. In Perez v. Court of Appeals, 17 the Court,
speaking through Mme. Justice Herrera, made the
following important statement:
There is another aspect to this case. What is involved
here is a money market transaction. As defined by
Lawrence Smith "the money market is a market dealing
in standardized short-term credit instruments (involving
large amounts) where lenders and borrowers do not
deal directly with each other but through a middle
manor a dealer in the open market." It involves
"commercial papers" which are instruments
"evidencing indebtness of any person or entity. . .,
which are issued, endorsed, sold or transferred or in
any manner conveyed to another person or entity, with
or without recourse". The fundamental function of the
money market device in its operation is to match and
bring together in a most impersonal manner both the
"fund users" and the "fund suppliers." The money
market is an "impersonal market", free from personal
considerations. "The market mechanism is intended to
provide quick mobility of money and securities."
The impersonal character of the money market device
overlooks the individuals or entities concerned.The
issuer of a commercial paper in the money market
necessarily knows in advance that it would be
expenditiously transacted and transferred to any
investor/lender without need of notice to said issuer. In
practice, no notification is given to the borrower or
issuer of commercial paper of the sale or transfer to the
investor.
xxx xxx xxx
There is need to individuate a money market
transaction, a relatively novel institution in the
Philippine commercial scene. It has been intended to
facilitate the flow and acquisition of capital on an
impersonal basis. And as specifically required by
Presidential Decree No. 678, the investing public must
be given adequate and effective protection in availing
of the credit of a borrower in the commercial paper
market.18 (Citations omitted; emphasis supplied)
We turn to Delta's arguments concerning alleged
compensation or offsetting between DMC PN No. 2731
and Philfinance PN No. 143-A. It is important to note
that at the time Philfinance sold part of its rights under
DMC PN No. 2731 to petitioner on 9 February 1981, no
compensation had as yet taken place and indeed none
could have taken place. The essential requirements of
compensation are listed in the Civil Code as follows:
Art. 1279. In order that compensation may be proper,
it is necessary:
(1) That each one of the obligors be bound principally,
and that he be at the same time a principal creditor of
the other;
(2) That both debts consists in a sum of money, or if
the things due are consumable, they be of the same
kind, and also of the same quality if the latter has been
stated;
(3) That the two debts are due;
(4) That they be liquidated and demandable;
(5) That over neither of them there be any retention or
controversy, commenced by third persons and
communicated in due time to the debtor. (Emphasis
supplied)
On 9 February 1981, neither DMC PN No. 2731 nor
Philfinance PN No. 143-A was due. This was explicitly
recognized by Delta in its 10 April 1980 "Letter of
Agreement" with Philfinance, where Delta
acknowledged that the relevant promissory notes were
"to be offsetted (sic) against [Philfinance] PN No. 143-
A upon co-terminal maturity."
As noted, the assignment to petitioner was made on 9
February 1981 or from forty-nine (49) days before the
"co-terminal maturity" date, that is to say, before any
compensation had taken place. Further, the
assignment to petitioner would have prevented
compensation had taken place between Philfinance
and Delta, to the extent of P304,533.33, because upon
execution of the assignment in favor of petitioner,
Philfinance and Delta would have ceased to be
creditors and debtors of each other in their own right to
the extent of the amount assigned by Philfinance to
petitioner. Thus, we conclude that the assignment
effected by Philfinance in favor of petitioner was a valid
one and that petitioner accordingly became owner of
DMC PN No. 2731 to the extent of the portion thereof
assigned to him.
The record shows, however, that petitioner notified
Delta of the fact of the assignment to him only on 14
July 1981, 19that is, after the maturity not only of the
money market placement made by petitioner but also
of both DMC PN No. 2731 and Philfinance PN No. 143-
A. In other words, petitioner notified Delta of his rights
as assignee after compensation had taken place by
operation of law because the offsetting instruments
had both reached maturity. It is a firmly settled doctrine
that the rights of an assignee are not any greater that
the rights of the assignor, since the assignee is merely
substituted in the place of the assignor 20 and that the
assignee acquires his rights subject to the equities —
i.e., the defenses — which the debtor could have set
up against the original assignor before notice of the
assignment was given to the debtor. Article 1285 of the
Civil Code provides that:
Art. 1285. The debtor who has consented to the
assignment of rights made by a creditor in favor of a
third person, cannot set up against the assignee the
compensation which would pertain to him against the
assignor, unless the assignor was notified by the
debtor at the time he gave his consent, that he
reserved his right to the compensation.
116
If the creditor communicated the cession to him but
the debtor did not consent thereto, the latter may set
up the compensation of debts previous to the cession,
but not of subsequent ones.
If the assignment is made without the knowledge of the
debtor, he may set up the compensation of all credits
prior to the same and also later ones until he
had knowledge of the assignment. (Emphasis
supplied)
Article 1626 of the same code states that: "the debtor
who, before having knowledge of the assignment, pays
his creditor shall be released from the obligation."
In Sison v. Yap-Tico, 21 the Court explained that:
[n]o man is bound to remain a debtor; he may pay to
him with whom he contacted to pay; and if he pay
before notice that his debt has been assigned, the law
holds him exonerated, for the reason that it is the duty
of the person who has acquired a title by transfer to
demand payment of the debt, to give his debt or
notice. 22
At the time that Delta was first put to notice of the
assignment in petitioner's favor on 14 July 1981, DMC
PN No. 2731 had already been discharged by
compensation. Since the assignor Philfinance could
not have then compelled payment anew by Delta of
DMC PN No. 2731, petitioner, as assignee of
Philfinance, is similarly disabled from collecting from
Delta the portion of the Note assigned to him.
It bears some emphasis that petitioner could have
notified Delta of the assignment or sale was effected
on 9 February 1981. He could have notified Delta as
soon as his money market placement matured on 13
March 1981 without payment thereof being made by
Philfinance; at that time, compensation had yet to set
in and discharge DMC PN No. 2731. Again petitioner
could have notified Delta on 26 March 1981 when
petitioner received from Philfinance the Denominated
Custodianship Receipt ("DCR") No. 10805 issued by
private respondent Pilipinas in favor of petitioner.
Petitioner could, in fine, have notified Delta at any time
before the maturity date of DMC PN No. 2731.
Because petitioner failed to do so, and because the
record is bare of any indication that Philfinance had
itself notified Delta of the assignment to petitioner, the
Court is compelled to uphold the defense of
compensation raised by private respondent Delta. Of
course, Philfinance remains liable to petitioner under
the terms of the assignment made by Philfinance to
petitioner.
II.
We turn now to the relationship between petitioner and
private respondent Pilipinas. Petitioner contends that
Pilipinas became solidarily liable with Philfinance and
Delta when Pilipinas issued DCR No. 10805 with the
following words:
Upon your written instruction, we [Pilipinas] shall
undertake physical delivery of the above
securities fully assigned to you —. 23
The Court is not persuaded. We find nothing in the
DCR that establishes an obligation on the part of
Pilipinas to pay petitioner the amount of P307,933.33
nor any assumption of liability in solidum with
Philfinance and Delta under DMC PN No. 2731. We
read the DCR as a confirmation on the part of Pilipinas
that:
(1) it has in its custody, as duly constituted custodian
bank, DMC PN No. 2731 of a certain face value, to
mature on 6 April 1981 and payable to the order of
Philfinance;
(2) Pilipinas was, from and after said date of the
assignment by Philfinance to petitioner (9 February
1981), holding that Note on behalf and for the benefit
of petitioner, at least to the extent it had been assigned
to petitioner by payee Philfinance; 24
(3) petitioner may inspect the Note either "personally or
by authorized representative", at any time during
regular bank hours; and
(4) upon written instructions of petitioner, Pilipinas
would physically deliver the DMC PN No. 2731 (or a
participation therein to the extent
P307,933.33) "should this Denominated
Custodianship receipt remain outstanding in
[petitioner's] favor thirty (30) days after its maturity."
Thus, we find nothing written in printers ink on the DCR
which could reasonably be read as converting Pilipinas
into an obligor under the terms of DMC PN No. 2731
assigned to petitioner, either upon maturity thereof or
any other time. We note that both in his complaint and
in his testimony before the trial court, petitioner referred
merely to the obligation of private respondent Pilipinas
to effect the physical delivery to him of DMC PN No.
2731. 25 Accordingly, petitioner's theory that Pilipinas
had assumed a solidary obligation to pay the amount
represented by a portion of the Note assigned to him
by Philfinance, appears to be a new theory constructed
only after the trial court had ruled against him. The
solidary liability that petitioner seeks to impute Pilipinas
cannot, however, be lightly inferred. Under article 1207
of the Civil Code, "there is a solidary liability only when
the law or the nature of the obligation requires
solidarity," The record here exhibits no express
assumption of solidary liability vis-a-vis petitioner, on
the part of Pilipinas. Petitioner has not pointed to us to
any law which imposed such liability upon Pilipinas nor
has petitioner argued that the very nature of the
custodianship assumed by private respondent
Pilipinas necessarily implies solidary liability under the
securities, custody of which was taken by Pilipinas.
Accordingly, we are unable to hold Pilipinas solidarily
liable with Philfinance and private respondent Delta
under DMC PN No. 2731.
We do not, however, mean to suggest that Pilipinas
has no responsibility and liability in respect of petitioner
under the terms of the DCR. To the contrary, we find,
after prolonged analysis and deliberation, that private
respondent Pilipinas had breached its undertaking
under the DCR to petitioner Sesbreño.
We believe and so hold that a contract of deposit was
constituted by the act of Philfinance in designating
Pilipinas as custodian or depositary bank. The
depositor was initially Philfinance; the obligation of the
depository was owed, however, to petitioner Sesbreño
as beneficiary of the custodianship or depository
agreement. We do not consider that this is a simple
case of a stipulation pour autri. The custodianship or
depositary agreement was established as an integral
of part of the money market transaction entered into by
petitioner with Philfinance. Petitioner bought a portion
of DMC PN No. 2731; Philfinance as assignor-vendor
deposited that Note with Pilipinas in order that the thing
sold would be placed outside the control of the vendor.
Indeed, the constituting of the depositary or
custodianship agreement was equivalent to
constructive delivery of the Note (to the extent it had
been sold or assigned to petitioner) to petitioner. It will
117
be seen that custodianship agreements are designed
to facilitate transactions in the money market by
providing a basis for confidence on the part of the
investors or placers that the instruments bought by
them are effectively taken out of the pocket, as it were,
of the vendors and placed safely beyond their reach,
that those instruments will be there available to the
placers of funds should they have need of them. The
depositary in a contract of deposit is obliged to return
the security or the thing deposited upon demand of the
depositor (or, in the presented case, of the beneficiary)
of the contract, even though a term for such return may
have been established in the said
contract. 26 Accordingly, any stipulation in the contract
of deposit or custodianship that runs counter to the
fundamental purpose of that agreement or which was
not brought to the notice of and accepted by the placer-
beneficiary, cannot be enforced as against such
beneficiary-placer.
We believe that the position taken above is supported
by considerations of public policy. If there is any party
that needs the equalizing protection of the law in
money market transactions, it is the members of the
general public whom place their savings in such market
for the purpose of generating interest revenues. 27 The
custodian bank, if it is not related either in terms of
equity ownership or management control to the
borrower of the funds, or the commercial paper dealer,
is normally a preferred or traditional banker of such
borrower or dealer (here, Philfinance). The custodian
bank would have every incentive to protect the interest
of its client the borrower or dealer as against the placer
of funds. The providers of such funds must be
safeguarded from the impact of stipulations privately
made between the borrowers or dealers and the
custodian banks, and disclosed to fund-providers only
after trouble has erupted.
In the case at bar, the custodian-depositary bank
Pilipinas refused to deliver the security deposited with
it when petitioner first demanded physical delivery
thereof on 2 April 1981. We must again note, in this
connection, that on 2 April 1981, DMC PN No. 2731
had not yet matured and therefore, compensation or
offsetting against Philfinance PN No. 143-A had not yet
taken place. Instead of complying with the demand of
the petitioner, Pilipinas purported to require and await
the instructions of Philfinance, in obvious contravention
of its undertaking under the DCR to effect physical
delivery of the Note upon receipt of "written
instructions" from petitioner Sesbreño. The ostensible
term written into the DCR (i.e., "should this [DCR]
remain outstanding in your favor thirty [30] days after
its maturity") was not a defense against petitioner's
demand for physical surrender of the Note on at least
three grounds: firstly, such term was never brought to
the attention of petitioner Sesbreño at the time the
money market placement with Philfinance was made;
secondly, such term runs counter to the very purpose
of the custodianship or depositary agreement as an
integral part of a money market transaction; and thirdly,
it is inconsistent with the provisions of Article 1988 of
the Civil Code noted above. Indeed, in principle,
petitioner became entitled to demand physical delivery
of the Note held by Pilipinas as soon as petitioner's
money market placement matured on 13 March 1981
without payment from Philfinance.
We conclude, therefore, that private respondent
Pilipinas must respond to petitioner for damages
sustained by arising out of its breach of duty. By failing
to deliver the Note to the petitioner as depositor-
beneficiary of the thing deposited, Pilipinas effectively
and unlawfully deprived petitioner of the Note
deposited with it. Whether or not Pilipinas itself
benefitted from such conversion or unlawful
deprivation inflicted upon petitioner, is of no moment
for present purposes.Prima facie, the damages
suffered by petitioner consisted of P304,533.33, the
portion of the DMC PN No. 2731 assigned to petitioner
but lost by him by reason of discharge of the Note by
compensation, plus legal interest of six percent
(6%) per annum containing from 14 March 1981.
The conclusion we have reached is, of course, without
prejudice to such right of reimbursement as Pilipinas
may havevis-a-vis Philfinance.
III.
The third principal contention of petitioner — that
Philfinance and private respondents Delta and
Pilipinas should be treated as one corporate entity —
need not detain us for long.
In the first place, as already noted, jurisdiction over the
person of Philfinance was never acquired either by the
trial court nor by the respondent Court of Appeals.
Petitioner similarly did not seek to implead Philfinance
in the Petition before us.
Secondly, it is not disputed that Philfinance and private
respondents Delta and Pilipinas have been organized
as separate corporate entities. Petitioner asks us to
pierce their separate corporate entities, but has been
able only to cite the presence of a common Director —
Mr. Ricardo Silverio, Sr., sitting on the Board of
Directors of all three (3) companies. Petitioner has
neither alleged nor proved that one or another of the
three (3) concededly related companies used the other
two (2) as mere alter egos or that the corporate affairs
of the other two (2) were administered and managed
for the benefit of one. There is simply not enough
evidence of record to justify disregarding the separate
corporate personalities of delta and Pilipinas and to
hold them liable for any assumed or undetermined
liability of Philfinance to petitioner. 28
WHEREFORE, for all the foregoing, the Decision and
Resolution of the Court of Appeals in C.A.-G.R. CV No.
15195 dated 21 march 1989 and 17 July 1989,
respectively, are hereby MODIFIED and SET ASIDE,
to the extent that such Decision and Resolution had
dismissed petitioner's complaint against Pilipinas
Bank. Private respondent Pilipinas bank is hereby
ORDERED to indemnify petitioner for damages in the
amount of P304,533.33, plus legal interest thereon at
the rate of six percent (6%) per annum counted from 2
April 1981. As so modified, the Decision and
Resolution of the Court of Appeals are hereby
AFFIRMED. No pronouncement as to costs.
SO ORDERED.
Bidin, Davide, Jr., Romero and Melo, JJ., concur.
# Footnotes
1 Exhibit "C", Folder of Exhibits, p. 3; TSN, 14 June
1983, p. 41.
2 Records, p. 441; Plaintiff's Memorandum, p. 3.
3 Id., p. 451; Plaintiff's Memorandum, p. 13.
4 TSN, 14 June 1983, p. 35.
5 Petitioner explained that he did not implead
Philfinance as party defendant because the latter was
118
under rehabilitation by the Securities and Exchange
Commission (TSN of the Pre-trial Conference, pp. 6
and 30; dated 04 March 1983).
6 Court of Appeals' Decision, p. 8; Rollo, p. 90.
7 Private respondent Delta adopted as its own the
Memorandum filed by private respondent Pilipinas
(Rollo, pp. 269-73).
8 Rollo, p. 6; Petition, p. 5.
9 Id., p. 88.
10 TSN, 17 August 1983, p. 36.
11 Records, pp. 36-37.
Philippine National Bank v. General Acceptance and
Finance Corp., 161 SCRA 449, 457 (1988).
23 Petitioner's Memorandum, p. 12; Rollo, p. 221.
24 The DCR specified the amount of P307,933.33 as
the extent to which DMC PN No. 2731 pertained to
petitioner Raul Sesbreño. This amount probably refers
to the placement of P300,000.00 by petitioner plus
interest from 9 February 1981 until the maturity date of
DMC PN No. 2731, i.e., 6 April 1981.
25 Complaint, pp. 2-3; Rollo, pp. 23-24; TSN of 11 April
1983, p. 51; TSN, 9 October 1986, pp. 15-16. See
also Minutes of the Pre-trial Conference, dated 04
March 1983, p. 9.

12 National Bank of Bristol v. Bartolome & O.R. Co., 59
A. 134, 138. See also, in this connection, Consolidated
Plywood v. IFC Leasing, 149 SCRA 449 (1987).
13 Exhibit "3," Records, p. 240.
14 National Investment and Development Corporation
v. De Los Angeles, 40 SCRA 487 (1971); Bastida v. Dy
Buncio & Co., 93 Phil. 195 (1953). See also Articles
1285 and 1625, Civil Code.
26 Article 1988, Civil Code.
27 See, in this connection, the second and third
"whereas" clauses of P.D. No. 678, dated 2 April 1975.
28 Pabalan v. National Labor Relations Commission,
184 SCRA 495 (1990); Del Rosario v. National Labor
Relations Commission, 187 SCRA 777 (1990); Remo,
Jr. v. Intermediate Appellate Court, 172 SCRA 405
(1989).

15 Article 1300, Civil Code.

16 Article 1292, id.

17 127 SCRA 636 (1984).

18 127 SCRA at 645-646.

19 Records, p, 451; Plaintiff's Memorandum, p. 13.

20 Gonzales v. Land Bank of the Philippines, 183

SCRA 520 (1990); Philippine National bank v. General
Acceptance and Finance Corp., 161 SCRA 449 (1988);
National Investment and Development Corporation v.
De los Angeles, 40 SCRA 489 (1971); Montinola v.
Philippine National Bank, 88 Phil. 178 (1951); National
Exchange Company, Ltd. v. Ramos, 51 Phil. 310
(1927); Sison v. Yap-Tico, 37 Phil. 584 (1918).

21 37 Phil. 584 (1918).

22 37 Phil. at 589. See also Rodriguez v. Court of

Appeals, 207 SCRA 553, 559 (1992). See, generally,

119
 FLORENCIO A. SALADAGA, Complainant,
vs.
ATTY. ARTURO B. ASTORGA, Respondent.

DECISION

LEONARDO-DE CASTRO, J.:

Membership in the legal profession is a high personal

privilege burdened with conditions,1 including
continuing fidelity to the law and constant possession
of moral fitness. Lawyers, as guardians of the law, play
a vital role in the preservation of society, and a
consequent obligation of lawyers is to maintain the
highest standards of ethical conduct.2 Failure to live by
the standards of the legal profession and to discharge
the burden of the privilege conferred on one as a
member of the bar warrant the suspension or
revocation of that privilege.

The Factual Antecedents

Complainant Florencio A. Saladaga and respondent

Atty. Arturo B. Astorga entered into a "Deed of Sale
with Right to Repurchase" on December 2, 1981 where
respondent sold (with rightof repurchase) to
complainant a parcel of coconut land located at
Barangay Bunga, Baybay, Leyte covered by Transfer
Certificate of Title (TCT) No. T-662 for P15,000.00.
Under the said deed, respondent represented that he
has "the perfect right to dispose as owner in fee simple"
the subject property and that the said property is "free
from all liens and encumbrances."3The deed also
provided that respondent, as vendor a retro, had two
Republic of the Philippines years within which to repurchase the property, and if
SUPREME COURT not repurchased within the said period, "the parties
Manila shall renew [the] instrument/agreement."4

EN BANC Respondent failed to exercise his right of repurchase

within the period provided in the deed, and no renewal
A.C. No. 4697 November 25, 2014 of the contract was made even after complainant sent
respondent a final demand dated May 10, 1984 for the
FLORENCIO A. SALADAGA, Complainant, latter to repurchase the property. Complainant
vs. remained in peaceful possession of the property until
ATTY. ARTURO B. ASTORGA, Respondent. December 1989 when he received letters from the
Rural Bank of Albuera (Leyte), Inc. (RBAI) informing
x-----------------------x him that the property was mortgaged by respondent to
A.C. No. 4728 RBAI, that the bank had subsequently foreclosed on
the property, and that complainant should therefore
vacate the property.5

120
Complainant was alarmed and made aninvestigation.
He learned the following:
(1) TCT No. T-662 was already cancelled by TCT No.
T-3211 in the name of Philippine National Bank (PNB)
as early as November 17, 1972 after foreclosure
proceedings;
(2) TCT No. T-3211 was cancelled by TCT No. T-7235
in the names of respondent and his wife on January 4,
1982 pursuant to a deed of sale dated March 27,1979
between PNB and respondent;
(3) Respondent mortgaged the subject property to
RBAI on March 14, 1984, RBAI foreclosed on the
property, and subsequently obtained TCT No. TP-
10635 on March 27, 1991.6 Complainant was
subsequently dispossessed of the property by RBAI.7
Aggrieved, complainant instituted a criminal complaint
for estafa against respondent with the Office of the
Provincial Prosecutor of Leyte, docketed as I.S. No.
95-144. The Provincial Prosecutor of Leyte approved
the Resolution8 dated April 21, 1995 in I.S. No. 95-144
finding that "[t]he facts of [the] case are sufficient to
engender a well-founded belief that Estafa x x x has
been committed and that respondent herein is probably
guilty thereof."9Accordingly, an Information10 dated
January 8,1996 was filed before the Municipal Trial
Court (MTC) of Baybay, Leyte, formally charging
respondent with the crime of estafa under Article 316,
paragraphs 1 and 2 of the Revised Penal
Code,11 committed as follows:
On March 14, 1984, accused representing himself as
the owner of a parcel of land known as Lot No. 7661 of
the Baybay Cadastre, mortgaged the same to the Rural
Bank of Albuera, Albuera, Leyte, within the jurisdiction
of this Honorable Court, knowing fully well that the
possessor and owner at that time was private
complainant Florencio Saladaga by virtue of a Pacto
de Retro Sale which accused executed in favor of
private complainant on 2nd December, 1981, without
first redeeming/repurchasing the same. [P]rivate
complainant knowing of accused[’s] unlawful act only
on or about the last week of February, 1991 when the
rural bank dispossessed him of the property, the
mortgage having been foreclosed, private complainant
thereby suffered damages and was prejudiced by
accused[’s] unlawful transaction and
misrepresentation.
The aforementioned estafa case against respondent
was docketed as Criminal Case No. 3112-A.
Complainant likewise instituted the instant
administrative cases against respondent by filing
before this Court an Affidavit-Complaint12 dated
January 28, 1997 and Supplemental
Complaint13 dated February 27, 1997, which were
docketed as A.C. No. 4697 and A.C. No. 4728,
respectively. In both complaints, complainant sought
the disbarment of respondent.
The administrative cases were referred to the
Integrated Bar of the Philippines (IBP) for investigation,
report and recommendation.14
In his Consolidated Answer15 dated August 16, 2003
filed before the IBP, respondent denied that his
agreement with complainant was a pacto de retrosale.
He claimed that it was an equitable mortgage and that,
if only complainant rendered an accounting of his
benefits from the produce of the land, the total amount
would have exceeded P15,000.00.
Report and Recommendation of the Investigating
Commissioner and Resolution of the IBP Board of
Governors
In a Report and Recommendation16 dated April 29,
2005, the Investigating Commissioner of the IBP’s
Commission on Bar Discipline found that respondent
was in bad faith when he dealt with complainant and
executed the "Deed of Sale with Right to Repurchase"
but later on claimed that the agreement was one of
equitable mortgage. Respondent was also guilty of
deceit or fraud when he represented in the "Deed of
Sale with Right to Repurchase" dated December 2,
1981 that the property was covered by TCT No. T-662,
even giving complainant the owner’s copy of the said
certificate of title, when the said TCT had already been
cancelled on November 17, 1972 by TCT No. T-3211
in the name of Philippine National Bank (PNB).
Respondent made matters even worse, when he had
TCT No. T-3211 cancelled with the issuance of TCT
No. T-7235 under his and his wife’s name on January
4,1982 without informing complainant. This was
compounded by respondent’s subsequent mortgage of
the property to RBAI, which led to the acquisition of the
property by RBAI and the dispossession thereof of
complainant. Thus, the Investigating Commissioner
recommended that respondent be (1) suspended from
the practice of law for one year, with warning that a
similar misdeed in the future shall be dealt with more
severity, and (2) ordered to return the sum
of P15,000.00, the amount he received as
consideration for the pacto de retrosale, with interest at
the legal rate.
Considering respondent’s "commission of unlawful
acts, especially crimes involving moral turpitude, actsof
dishonesty, grossly immoral conduct and deceit," the
IBP Board of Governors adopted and approved the
Investigating Commissioner’s Report and
Recommendation with modification as follows:
respondent is(1) suspended from the practice of law for
two years, with warning that a similar misdeed in the
future shall be dealt with more severity, and (2) ordered
to return the sum of P15,000.00 received in
consideration of the pacto de retrosale, with legal
interest.17
The Court’s Ruling
The Court agrees with the recommendation of the IBP
Board of Governors to suspend respondent from the
practice of law for two years, but it refrains from
ordering respondent to return the P15,000.00
consideration, plus interest.
Respondent does not deny executing the "Deed of
Sale with Right to Repurchase" dated December 2,
1981 in favor of complainant. However, respondent
insists that the deed is not one of sale with pacto de
retro, but one of equitable mortgage. Thus, respondent
argues that he still had the legal right to mortgage the
subject property to other persons. Respondent
additionally asserts that complainant should render an
accounting of the produce the latter had collected from
the said property, which would already exceed
the P15,000.00 consideration stated in the deed.
There is no merit in respondent’s defense.
Regardless of whether the written contract between
respondent and complainant is actually one of sale with
pacto de retroor of equitable mortgage, respondent’s
actuations in his transaction with complainant, as well
121
as in the present administrative cases, clearly show a
disregard for the highest standards of legal proficiency,
morality, honesty, integrity, and fair dealing required
from lawyers, for which respondent should be held
administratively liable.
When respondent was admitted to the legal profession,
he took an oath where he undertook to "obey the laws,"
"do no falsehood," and "conduct [him]self as a lawyer
according to the best of [his] knowledge and
discretion."18He gravely violated his oath.
The Investigating Commissioner correctly found, and
the IBP Board of Governors rightly agreed, that
respondent caused the ambiguity or vagueness in the
"Deed of Sale with Right to Repurchase" as he was the
one who prepared or drafted the said instrument.
Respondent could have simply denominated the
instrument as a deed of mortgage and referred to
himself and complainant as "mortgagor" and
"mortgagee," respectively, rather than as "vendor a
retro" and "vendee a retro." If only respondent had
been more circumspect and careful in the drafting and
preparation of the deed, then the controversy between
him and complainant could havebeen avoided or, at
the very least, easily resolved. His imprecise and
misleading wording of the said deed on its face
betrayed lack oflegal competence on his part. He
thereby fell short of his oath to "conduct [him]self as a
lawyer according to the best of [his] knowledge and
discretion."
More significantly, respondent transgressed the laws
and the fundamental tenet of human relations
asembodied in Article 19 of the Civil Code:
Art. 19. Every person must, in the exercise of his rights
and in the performance of his duties, act with justice,
give everyone his due, and observe honesty and good
faith.
Respondent, as owner of the property, had the right to
mortgage it to complainant but, as a lawyer, he should
have seen to it that his agreement with complainant is
embodied in an instrument that clearly expresses the
intent of the contracting parties. A lawyer who drafts a
contract must see to it that the agreement faithfully and
clearly reflects the intention of the contracting parties.
Otherwise, the respective rights and obligations of the
contracting parties will be uncertain, which opens the
door to legal disputes between the said parties. Indeed,
the uncertainty caused by respondent’s poor
formulation of the "Deed of Sale with Right to
Repurchase" was a significant factor in the legal
controversy between respondent and complainant.
Such poor formulation reflects at the very least
negatively on the legal competence of respondent.
Under Section 63 of the Land Registration Act,19 the
law in effect at the time the PNB acquired the subject
property and obtained TCT No. T-3211 in its name in
1972, where a decree in favor of a purchaser who
acquires mortgaged property in foreclosure
proceedings becomes final, such purchaser becomes
entitled to the issuance of a new certificate of title in his
name and a memorandum thereof shall be "indorsed
upon the mortgagor’s original certificate." 20 TCT No. T-
662, which respondent gave complainant when they
entered into the "Deed of Sale with Right to
Repurchase" dated December 2, 1981, does not
bearsuch memorandum but only a memorandum on
the mortgage of the property to PNB in 1963 and the
subsequent amendment of the mortgage.
Respondent dealt with complainant with bad faith,
falsehood, and deceit when he entered into the "Deed
of Sale with Right to Repurchase" dated December 2,
1981 with the latter. He made it appear that the
property was covered by TCT No. T-662 under his
name, even giving complainant the owner’s copy of the
said certificate oftitle, when the truth is that the said
TCT had already been cancelled some nine years
earlier by TCT No. T-3211 in the name of PNB. He did
not evencare to correct the wrong statement in the
deed when he was subsequently issued a new copy of
TCT No. T-7235 on January 4, 1982,21 or barely a
month after the execution of the said deed. All told,
respondent clearly committed an act of gross
dishonesty and deceit against complainant.
Canon 1 and Rule 1.01 of the Codeof Professional
Responsibility provide:
CANON 1 – A lawyer shall uphold the constitution,
obey the laws of the land and promote respect for law
and legal processes.
Rule 1.01 – A lawyer shall not engage in unlawful,
dishonest, immoral or deceitful conduct. Under Canon
1, a lawyer is not only mandated to personally obey the
laws and the legal processes, he is moreover expected
to inspire respect and obedience thereto. On the other
hand, Rule 1.01 states the norm of conduct that is
expected of all lawyers.22
Any act or omission that is contrary to, prohibited or
unauthorized by, in defiance of, disobedient to, or
disregards the law is "unlawful." "Unlawful" conduct
does not necessarily imply the element of criminality
although the concept is broad enough to include such
element.23
To be "dishonest" means the disposition to lie, cheat,
deceive, defraud or betray; be untrustworthy; lacking
inintegrity, honesty, probity, integrity in principle,
fairness and straightforwardness. On the other hand,
conduct that is "deceitful" means as follows:
[Having] the proclivity for fraudulent and deceptive
misrepresentation, artifice or device that is used upon
another who is ignorant of the true facts, to the
prejudice and damage of the party imposed upon. In
order to be deceitful, the person must either have
knowledge of the falsity or acted in reckless and
conscious ignorance thereof, especially if the parties
are not on equal terms, and was done with the intent
that the aggrieved party act thereon, and the latter
indeed acted in reliance of the false statement or deed
in the manner contemplated to his injury.24The actions
of respondent in connection with the execution of the
"Deed of Sale with Right to Repurchase" clearly fall
within the concept of unlawful, dishonest, and deceitful
conduct. They violate Article 19 of the Civil Code. They
show a disregard for Section 63 of the Land
Registration Act. They also reflect bad faith,
dishonesty, and deceit on respondent’s part. Thus,
respondent deserves to be sanctioned.
Respondent’s breach of his oath, violation of the laws,
lack of good faith, and dishonesty are compounded by
his gross disregard of this Court’s directives, as well as
the orders of the IBP’s Investigating Commissioner
(who was acting as an agent of this Court pursuant to
the Court’s referral of these cases to the IBP for
investigation, report and recommendation), which
caused delay in the resolution of these administrative
cases.
In particular, the Court required respondent to
comment on complainant’s Affidavit-Complaint in A.C.
122
No. 4697 and Supplemental Complaint in A.C. No.
4728 on March 12, 1997 and June 25, 1997,
respectively.25 While he requested for several
extensions of time within which to submit his comment,
no such comment was submitted prompting the Court
to require him in a Resolution dated February 4,1998
to (1) show cause why he should not be disciplinarily
dealt with or held in contempt for such failure, and (2)
submit the consolidated comment.26Respondent
neither showed cause why he should not be
disciplinarily dealt with or held in contempt for such
failure, nor submitted the consolidated comment.
When these cases were referred to the IBP and during
the proceedings before the IBP’s Investigating
Commissioner, respondent was again required several
times to submit his consolidated answer. He only
complied on August 28, 2003, or more than six years
after this Court originally required him to do so. The
Investigating Commissioner also directed the parties to
submit their respective position papers. Despite having
been given several opportunities to submit the same,
respondent did not file any position paper.27
Respondent’s disregard of the directives of this Court
and of the Investigating Commissioner, which caused
undue delay in these administrative cases,
contravenes the following provisions of the Code of
Professional Responsibility:
CANON 11 – A lawyer shall observe and maintain the
respect due to the courts and to judicial officers and
should insist on similar conduct by others.
xxxx
CANON 12 – A lawyer shall exert every effort and
consider it his duty to assist in the speedy and efficient
administration of justice.
xxxx
Rule 12.03 – A lawyer shall not, after obtaining
extensions of time to file pleadings, memoranda or
briefs, let the period lapse without submitting the same
or offering an explanation for his failure to do so.
Rule 12.04 – A lawyer shall not unduly delay a case,
impede the execution of a judgment or misuse court
processes.
Respondent’s infractions are aggravated by the fact
that he has already been imposed a disciplinary
sanction before.1âwphi1 In Nuñez v. Atty.
Astorga,28 respondent was held liable for conduct
unbecoming an attorney for which he was
fined P2,000.00.
Given the foregoing, the suspension of respondent
from the practice of law for two years, as recommended
by the IBP Board of Governors, is proper.
The Court, however, will not adopt the
recommendation of the IBP to order respondent to
return the sum ofP15,000.00 he received from
complainant under the "Deed of Sale with Right to
Repurchase." This is a civil liability best determined
and awarded in a civil case rather than the present
administrative cases.
In Roa v. Moreno,29 the Court pronounced that "[i]n
disciplinary proceedings against lawyers, the only
issue is whether the officer of the court is still fit to be
allowed to continue as a member of the Bar. Our only
concern is the determination of respondent’s
administrative liability. Our findings have no material
bearing on other judicial action which the parties may
choose to file against each other."While the respondent
lawyer’s wrongful actuations may give rise at the same
time to criminal, civil, and administrative liabilities, each
must be determined in the appropriate case; and every
case must be resolved in accordance with the facts and
the law applicable and the quantum of proof required
in each. Section 5,30 in relation to Sections 131 and
2,32 Rule 133 of the Rules of Court states that in
administrative cases, such as the ones atbar, only
substantial evidence is required, not proof beyond
reasonable doubt as in criminal cases, or
preponderance of evidence asin civil cases.
Substantial evidence is that amount of relevant
evidence which a reasonable mind might accept as
adequate to justify a conclusion.33
The Court notes that based on the same factual
antecedents as the present administrative cases,
complainant instituted a criminal case for estafa
against respondent, docketed as Criminal Case No.
3112-A, before the MTC. When a criminal action is
instituted, the civil action for the recovery of civil liability
arising from the offense charged shall be deemed
instituted with the criminal action unless the offended
party waives the civil action, reserves the right to
institute it separately or institutes the civil action prior
to the criminal action.34 Unless the complainant waived
the civil action, reserved the right to institute it
separately, or instituted the civil action prior to the
criminal action, then his civil action for the recovery of
civil liability arising from the estafa committed by
respondent is deemed instituted with Criminal Case
No. 3112-A. The civil liability that complainant may
recover in Criminal Case No. 3112-A includes
restitution; reparation of the damage caused him;
and/or indemnification for consequential
damages,35 which may already cover the P15,000.00
consideration complainant had paid for the subject
property.
WHEREFORE, respondent is hereby found GUILTY of
the following: breach of the Lawyer’s Oath; unlawful,
dishonest, and deceitful conduct; and disrespect for the
Court and causing undue delay of these cases, for
which he is SUSPENDED from the practice of law for
a period of two (2) years, reckoned from receipt of this
Decision, with WARNING that a similar misconduct in
the future shall be dealt with more severely.
Let a copy of this Decision be furnished the Office of
the Bar Confidant and the Integrated Bar of the
Philippines for their information and guidance. The
Court Administrator is directed to circulate this
Decision to all courts in the country.
SO ORDERED.
TERESITA J. LEONARDO-DE CASTRO
Associate Justice
WE CONCUR:
MARIA LOURDES P.A. SERENO
Chief Justice
PRESBITERO J. On leave
VELASCO, JR. ARTURO D. BRION*
Associate Justice Associate Justice
123
 7 20
Id., Vol. II, p. 67. Section 63 of the Land Registration Act provides:
DIOSDADO M. LUCAS P. Sec. 63. Mortgages of registered land may be
PERALTA BERSAMIN 8 Id. at 21-25. foreclosed in the manner provided in the Code of
Associate Justice Associate Justice Procedure in Civil Actions and Special Proceedings. A
9 Id. at 24.
certified copy of the final decree of the court affirming
10 Id. at 26. the sale under foreclosure proceedings may be filed
MARIANO C. DEL MARTIN S. with the register of deeds after the time for appealing
CASTILLO VILLARAMA, JR. 11 ART. 316. Other forms of swindling.– The penalty of therefrom has expired, and the purchaser shall
Associate Justice Associate Justice arresto mayorin its minimum and medium periods and thereupon be entitled to the entry of a new certificate
a fine of not less than the value of the damage caused and to the issuance of a new owner’s duplicate
and not more than three times such value, shall be certificate, a memorandum thereof being at the same
JOSE PORTUGAL JOSE CATRAL imposed upon: time likewise indorsed upon the mortgagor’s original
PEREZ MENDOZA certificate and the mortgagee’s duplicate, if any, being
Associate Justice Associate Justice 1. Any person who, pretending to be the owner of any first delivered up and canceled: Provided, however,
real property, shall convey, sell, encumber, or That nothing contained in this Act shall be construed to
mortgage the same; prevent the mortgagor or other person interested
On official leave fromdirectly impeaching by any proper legal
BIENVENIDO L. 2. Any person who, knowing that real property is proceedings any foreclosure proceedings affecting
ESTELA M. PERLAS- encumbered, shall dispose of the same, although such
REYES registered land, prior to the entry of a new certificate of
BERNABE** encumbrance be not recorded[.]
Associate Justice title. (Emphasis supplied.)
Associate Justice
2 Rollo, Vol. I, pp. 2-5. 21It appears from the annotations/memoranda at the
13 Id., Vol. II, pp. 1-7. back of TCT No. T-3211 that said certificate of title was
MARVIC MARIO FRANCIS H. cancelled by TCT No. T-7235 when the deed of sale
VICTOR F. LEONEN JARDELEZA 14 Id., Vol. I, p. 51; Resolution dated February 14, 2000. dated March 27, 1979 between PNB and respondent
Associate Justice Associate Justice was registered with the Register of Deeds.
15 Id., Vol. III, pp. 146-154. Respondent, however, lost his owner’s duplicate and
16
was issued a new copy of such owner’s duplicate on
Id., Vol. II, pp. 52-69. January 4, 1982. (Rollo, Vol. III, p. 200.)
17 Id. at 50-51, Notice of Resolution. 22 Code of Professional Responsibility (Annotated), pp.
Footnotes
1, 16.
18 The Lawyer’s Oath states in full:
* On leave. 23 Id., citing Black’s Law Dictionary (6th ed.), p. 1536.
I, __________, do solemnly swear that I will maintain
** On official leave. allegiance to the Republic of the Philippines; I will 24 Id. at 6-7.
1 Manzano v. Atty. Soriano, 602 Phil. 419, 421 (2009). support its Constitution and obey the lawsas well as the
legal orders of the duly constituted authorities therein; 25 Rollo, Vol. I, p. 25, and Vol. II, p. 37, respectively.
2 Preamble, 2nd paragraph, American Bar Association I will do no falsehood, nor consent to the doing of any
26
Model Code of Professional Responsibility (1983), in court; I will not wittingly or willingly promote or sue Id., Vol. I, p. 40.
cited in Code of Professional Responsibility any groundless, false or unlawful suit, nor give aid nor 27
consent to the same. I will delay no man for money or Id., Vol. III, pp. 222-224, Order dated January 24,
(Annotated), p. 1. 2005.
malice, and will conduct myself as a lawyer according
3Joint Memorandum for complainant, rollo, Vol. III, pp. to the best ofmy knowledge and discretion with all good 28 492 Phil. 450, 460 (2005).
173-205, 173-174, 192-193. fidelity as well to the courts as to my clients; and I
4
impose upon myself this voluntary obligation without 29 A.C. No. 8382, April 21, 2010, 618 SCRA 693, 700.
Id. at 192-193. any mental reservation or purpose of evasion. So help
5 me God. (Emphases supplied.) 30SECTION 5. Substantial evidence. – In cases filed
Id. at 174-175, 195-197.
before administrative or quasi-judicial bodies, a fact
19
6 Act No. 496 enacted on November 6, 1902. may be deemed established if it is supported by
Id. at 175, 198-203.
124
substantial evidence, or that amount of relevant COURT OF APPEALS and ISABEL LUCIA SINGH
evidence which a reasonable mind might accept as BUENAVENTURA, respondents.
adequate to justify a conclusion.
x-------------------x
31 SECTION 1. Preponderance of evidence, how
determined. – In civil cases, the party having the G.R. No. 127449 March 31, 2005
burden of proof must establish his case by a
NOEL BUENAVENTURA, Petitioner,
preponderance of evidence. In determining where the
vs.
preponderance or superior weight of evidence on the
COURT OF APPEALS and ISABEL LUCIA SINGH
issues involved lies, the court may consider all the facts
BUENAVENTURA, Respondents.
and circumstances of the case, the witnesses’ manner
of testifying, their intelligence, their means and DECISION
opportunity of knowing the facts to which they are
testifying the nature of the facts to which they testify, AZCUNA, J.:
the probability or improbability of their testimony, their
interest or want of interest, and also their personal These cases involve a petition for the declaration of
credibility so far as the same may legitimately appear nullity of marriage, which was filed by petitioner Noel
upon the trial. The court may also consider the number Buenaventura on July 12, 1992, on the ground of the
of witnesses, though the preponderance is not alleged psychological incapacity of his wife, Isabel
necessarily with the greater number. Singh Buenaventura, herein respondent. After
respondent filed her answer, petitioner, with leave of
32 SECTION 2. Proof beyond reasonable doubt. – In a court, amended his petition by stating that both he and
criminal case, the accused is entitled to an acquittal, his wife were psychologically incapacitated to comply
unless his guilt is shown beyond reasonable doubt. with the essential obligations of marriage. In response,
Proof beyond reasonable doubt does not mean such a respondent filed an amended answer denying the
degree of proof as, excluding possibility of error, allegation that she was psychologically incapacitated. 1
produces absolute certainty. Moral certainty only is
required, or that degree of proof which produces On July 31, 1995, the Regional Trial Court promulgated
conviction in an unprejudiced mind. a Decision, the dispositive portion of which reads:
33
Peña v. Paterno, A.C. No. 4191, June 10, 2013, 698 WHEREFORE, judgment is hereby rendered as
SCRA 1, 12-13. follows:
34Rule 111, Section 1(a) of the Revised Rules of 1) Declaring and decreeing the marriage entered into
Criminal Procedure. between plaintiff Noel A. Buenaventura and defendant
Isabel Lucia Singh Buenaventura on July 4, 1979, null
35 Articles 104 to 107 of the Revised Penal Code. and void ab initio;

2) Ordering the plaintiff to pay defendant moral

damages in the amount of 2.5 million pesos and
exemplary damages of 1 million pesos with 6% interest
Republic of the Philippines from the date of this decision plus attorney’s fees
SUPREME COURT ofP100,000.00;
Manila
3) Ordering the plaintiff to pay the defendant expenses
FIRST DIVISION of litigation of P50,000.00, plus costs;
G.R. No. 127358 March 31, 2005 4) Ordering the liquidation of the assets of the conjugal
NOEL BUENAVENTURA, Petitioner, partnership property[,] particularly the plaintiff’s
vs. separation/retirement benefits received from the Far
East Bank [and] Trust Company[,] by ceding, giving
125
and paying to her fifty percent (50%) of the net amount
of P3,675,335.79 or P1,837,667.89 together with 12%
interest per annum from the date of this decision and
one-half (1/2) of his outstanding shares of stock with
Manila Memorial Park and Provident Group of
Companies;
5) Ordering him to give a regular support in favor of his
son Javy Singh Buenaventura in the amount
ofP15,000.00 monthly, subject to modification as the
necessity arises;
6) Awarding the care and custody of the minor Javy
Singh Buenaventura to his mother, the herein
defendant; and
7) Hereby authorizing the defendant to revert back to
the use of her maiden family name Singh.
Let copies of this decision be furnished the appropriate
civil registry and registries of properties.
SO ORDERED.2
Petitioner appealed the above decision to the Court of
Appeals. While the case was pending in the appellate
court, respondent filed a motion to increase
the P15,000 monthly support pendente lite of their son
Javy Singh Buenaventura. Petitioner filed an
opposition thereto, praying that it be denied or that
such incident be set for oral argument.3
On September 2, 1996, the Court of Appeals issued a
Resolution increasing the support pendente
lite toP20,000.4 Petitioner filed a motion for
reconsideration questioning the said Resolution.5
On October 8, 1996, the appellate court promulgated a
Decision dismissing petitioner’s appeal for lack of merit
and affirming in toto the trial court’s
decision.6 Petitioner filed a motion for reconsideration
which was denied. From the abovementioned
Decision, petitioner filed the instant Petition for Review
on Certiorari.
On November 13, 1996, through another Resolution,
the Court of Appeals denied petitioner’s motion for
reconsideration of the September 2, 1996 Resolution,
which increased the monthly support for the
son.7Petitioner filed a Petition for Certiorari to question
these two Resolutions.
On July 9, 1997, the Petition for Review
on Certiorari8 and the Petition for Certiorari9 were
ordered consolidated by this Court.10
In the Petition for Review on Certiorari petitioner claims
that the Court of Appeals decided the case not in
accord with law and jurisprudence, thus:
1. WHEN IT AWARDED DEFENDANT-APPELLEE
MORAL DAMAGES IN THE AMOUNT OF P2.5
MILLION AND EXEMPLARY DAMAGES OF P1
MILLION, WITH 6% INTEREST FROM THE DATE OF
ITS DECISION, WITHOUT ANY LEGAL AND MORAL
BASIS;
2. WHEN IT AWARDED P100,000.00 ATTORNEY’S
FEES AND P50,000.00 EXPENSES OF LITIGATION,
PLUS COSTS, TO DEFENDANT-APPELLEE,
WITHOUT FACTUAL AND LEGAL BASIS;
3. WHEN IT ORDERED PLAINTIFF-APPELLANT
NOEL TO PAY DEFENDANT-APPELLEE ONE-HALF
ORP1,837,667.89 OUT OF HIS RETIREMENT
BENEFITS RECEIVED FROM THE FAR EAST BANK
AND TRUST CO., WITH 12% INTEREST THEREON
FROM THE DATE OF ITS DECISION,
NOTWITHSTANDING THAT SAID RETIREMENT
BENEFITS ARE GRATUITOUS AND EXCLUSIVE
PROPERTY OF NOEL, AND ALSO TO DELIVER TO
DEFENDANT-APPELLEE ONE-HALF OF HIS
SHARES OF STOCK WITH THE MANILA MEMORIAL
PARK AND THE PROVIDENT GROUP OF
COMPANIES, ALTHOUGH SAID SHARES OF
STOCK WERE ACQUIRED BY NOEL BEFORE HIS
MARRIAGE TO RESPONDENT ISABEL AND ARE,
THEREFORE, AGAIN HIS EXCLUSIVE
PROPERTIES; AND
4. WHEN IT AWARDED EXCLUSIVE CARE AND
CUSTODY OVER THE PARTIES’ MINOR CHILD TO
DEFENDANT-APPELLEE WITHOUT ASKING THE
CHILD (WHO WAS ALREADY 13 YEARS OLD AT
THAT TIME) HIS CHOICE AS TO WHOM, BETWEEN
HIS TWO PARENTS, HE WOULD LIKE TO HAVE
CUSTODY OVER HIS PERSON.11
In the Petition for Certiorari, petitioner advances the
following contentions:
THE COURT OF APPEALS GRAVELY ABUSED ITS
DISCRETION WHEN IT REFUSED TO SET
RESPONDENT’S MOTION FOR INCREASED
SUPPORT FOR THE PARTIES’ SON FOR
HEARING.12
THERE WAS NO NEED FOR THE COURT OF
APPEALS TO INCREASE JAVY’S MONTHLY
SUPPORT OF P15,000.00 BEING GIVEN BY
PETITIONER EVEN AT PRESENT PRICES.13
IN RESOLVING RESPONDENT’S MOTION FOR THE
INCREASE OF JAVY’S SUPPORT, THE COURT OF
APPEALS SHOULD HAVE EXAMINED THE LIST OF
EXPENSES SUBMITTED BY RESPONDENT IN THE
LIGHT OF PETITIONER’S OBJECTIONS THERETO,
INSTEAD OF MERELY ASSUMING THAT JAVY IS
ENTITLED TO A P5,000 INCREASE IN SUPPORT AS
SAID AMOUNT IS "TOO MINIMAL."14
LIKEWISE, THE COURT OF APPEALS SHOULD
HAVE GIVEN PETITIONER AN OPPORTUNITY TO
PROVE HIS PRESENT INCOME TO SHOW THAT HE
CANNOT AFFORD TO INCREASE JAVY’S
SUPPORT.15
With regard to the first issue in the main case, the Court
of Appeals articulated:
On Assignment of Error C, the trial court, after findings
of fact ascertained from the testimonies not only of the
parties particularly the defendant-appellee but
likewise, those of the two psychologists, awarded
damages on the basis of Articles 21, 2217 and 2229 of
the Civil Code of the Philippines.
Thus, the lower court found that plaintiff-appellant
deceived the defendant-appellee into marrying him by
professing true love instead of revealing to her that he
was under heavy parental pressure to marry and that
because of pride he married defendant-appellee; that
he was not ready to enter into marriage as in fact his
career was and always would be his first priority; that
he was unable to relate not only to defendant-appellee
as a husband but also to his son, Javy, as a father; that
he had no inclination to make the marriage work such
that in times of trouble, he chose the easiest way out,
that of leaving defendant–appellee and their son; that
he had no desire to keep defendant-appellee and their
son as proved by his reluctance and later, refusal to
reconcile after their separation; that the
aforementioned caused defendant-appellee to suffer
126
mental anguish, anxiety, besmirched reputation,
sleepless nights not only in those years the parties
were together but also after and throughout their
separation.
Plaintiff-appellant assails the trial court’s decision on
the ground that unlike those arising from a breach in
ordinary contracts, damages arising as a consequence
of marriage may not be awarded. While it is correct that
there is, as yet, no decided case by the Supreme Court
where damages by reason of the performance or non-
performance of marital obligations were awarded, it
does not follow that no such award for damages may
be made.
Defendant-appellee, in her amended answer,
specifically prayed for moral and exemplary damages
in the total amount of 7 million pesos. The lower court,
in the exercise of its discretion, found full justification of
awarding at least half of what was originally prayed for.
We find no reason to disturb the ruling of the trial
court.16
The award by the trial court of moral damages is based
on Articles 2217 and 21 of the Civil Code, which read
as follows:
ART. 2217. Moral damages include physical suffering,
mental anguish, fright, serious anxiety, besmirched
reputation, wounded feelings, moral shock, social
humiliation, and similar injury. Though incapable of
pecuniary computation, moral damages may be
recovered if they are the proximate result of the
defendant’s wrongful act or omission.
ART. 21. Any person who wilfully causes loss or injury
to another in a manner that is contrary to morals, good
customs or public policy shall compensate the latter for
the damage.
The trial court referred to Article 21 because Article
221917 of the Civil Code enumerates the cases in
which moral damages may be recovered and it
mentions Article 21 as one of the instances. It must be
noted that Article 21 states that the individual must
willfully cause loss or injury to another. There is a need
that the act is willful and hence done in complete
freedom. In granting moral damages, therefore, the
trial court and the Court of Appeals could not but have
assumed that the acts on which the moral damages
were based were done willfully and freely, otherwise
the grant of moral damages would have no leg to stand
on.
On the other hand, the trial court declared the marriage
of the parties null and void based on Article 36 of the
Family Code, due to psychological incapacity of the
petitioner, Noel Buenaventura. Article 36 of the Family
Code states:
A marriage contracted by any party who, at the time of
the celebration, was psychologically incapacitated to
comply with the essential marital obligations of
marriage, shall likewise be void even if such incapacity
becomes manifest only after its solemnization.
Psychological incapacity has been defined, thus:
. . . no less than a mental (not physical) incapacity that
causes a party to be truly incognitive of the basic
marital covenants that concomitantly must be
assumed and discharged by the parties to the
marriage which, as so expressed by Article 68 of the
Family Code, include their mutual obligations to live
together, observe love, respect and fidelity and render
help and support. There is hardly any doubt that the
intendment of the law has been to confine the meaning
of "psychological incapacity" to the most serious cases
of personality disorders clearly demonstrative of
an utter insensitivity or inability to give meaning
and significance to the marriage. . . .18
The Court of Appeals and the trial court considered the
acts of the petitioner after the marriage as proof of his
psychological incapacity, and therefore a product of his
incapacity or inability to comply with the essential
obligations of marriage. Nevertheless, said courts
considered these acts as willful and hence as grounds
for granting moral damages. It is contradictory to
characterize acts as a product of psychological
incapacity, and hence beyond the control of the party
because of an innate inability, while at the same time
considering the same set of acts as willful. By declaring
the petitioner as psychologically incapacitated, the
possibility of awarding moral damages on the same set
of facts was negated. The award of moral damages
should be predicated, not on the mere act of entering
into the marriage, but on specific evidence that it was
done deliberately and with malice by a party who had
knowledge of his or her disability and yet willfully
concealed the same. No such evidence appears to
have been adduced in this case.
For the same reason, since psychological incapacity
means that one is truly incognitive of the basic marital
covenants that one must assume and discharge as a
consequence of marriage, it removes the basis for the
contention that the petitioner purposely deceived the
private respondent. If the private respondent was
deceived, it was not due to a willful act on the part of
the petitioner. Therefore, the award of moral damages
was without basis in law and in fact.
Since the grant of moral damages was not proper, it
follows that the grant of exemplary damages cannot
stand since the Civil Code provides that exemplary
damages are imposed in addition to moral,
temperate, liquidated or compensatory damages.19
With respect to the grant of attorney’s fees and
expenses of litigation the trial court explained, thus:
Regarding Attorney’s fees, Art. 2208 of the Civil Code
authorizes an award of attorney’s fees and expenses
of litigation, other than judicial costs, when as in this
case the plaintiff’s act or omission has compelled the
defendant to litigate and to incur expenses of litigation
to protect her interest (par. 2), and where the Court
deems it just and equitable that attorney’s fees and
expenses of litigation should be recovered. (par. 11)20
The Court of Appeals reasoned as follows:
On Assignment of Error D, as the award of moral and
exemplary damages is fully justified, the award of
attorney’s fees and costs of litigation by the trial court
is likewise fully justified.21
The acts or omissions of petitioner which led the lower
court to deduce his psychological incapacity, and his
act in filing the complaint for the annulment of his
marriage cannot be considered as unduly compelling
the private respondent to litigate, since both are
grounded on petitioner’s psychological incapacity,
which as explained above is a mental incapacity
causing an utter inability to comply with the obligations
of marriage. Hence, neither can be a ground for
attorney’s fees and litigation expenses. Furthermore,
since the award of moral and exemplary damages is
no longer justified, the award of attorney’s fees and
expenses of litigation is left without basis.
127
Anent the retirement benefits received from the Far
East Bank and Trust Co. and the shares of stock in the
Manila Memorial Park and the Provident Group of
Companies, the trial court said:
The third issue that must be resolved by the Court is
what to do with the assets of the conjugal partnership
in the event of declaration of annulment of the
marriage. The Honorable Supreme Court has held that
the declaration of nullity of marriage carries ipso
facto a judgment for the liquidation of property
(Domingo v. Court of Appeals, et al., G.R. No. 104818,
Sept. 17, 1993, 226 SCRA, pp. 572 – 573, 586). Thus,
speaking through Justice Flerida Ruth P. Romero, it
was ruled in this case:
When a marriage is declared void ab initio, the law
states that the final judgment therein shall provide for
the liquidation, partition and distribution of the
properties of the spouses, the custody and support of
the common children and the delivery of their
presumptive legitimes, unless such matters had been
adjudicated in the previous proceedings.
The parties here were legally married on July 4, 1979,
and therefore, all property acquired during the
marriage, whether the acquisition appears to have
been made, contracted or registered in the name of
one or both spouses, is presumed to be conjugal
unless the contrary is proved (Art. 116, New Family
Code; Art. 160, Civil Code). Art. 117 of the Family Code
enumerates what are conjugal partnership properties.
Among others they are the following:
1) Those acquired by onerous title during the marriage
at the expense of the common fund, whether the
acquisition be for the partnership, or for only one of the
spouses;
2) Those obtained from the labor, industry, work or
profession of either or both of the spouses;
3) The fruits, natural, industrial, or civil, due or received
during the marriage from the common property, as well
as the net fruits from the exclusive property of each
spouse. . . .
Applying the foregoing legal provisions, and without
prejudice to requiring an inventory of what are the
parties’ conjugal properties and what are the exclusive
properties of each spouse, it was disclosed during the
proceedings in this case that the plaintiff who worked
first as Branch Manager and later as Vice-President of
Far East Bank & Trust Co. received
separation/retirement package from the said bank in
the amount of P3,701,500.00 which after certain
deductions amounting to P26,164.21 gave him a net
amount of P3,675,335.79 and actually paid to him on
January 9, 1995 (Exhs. 6, 7, 8, 9, 10, 11). Not having
shown debts or obligations other than those deducted
from the said retirement/separation pay, under Art. 129
of the Family Code "The net remainder of the conjugal
partnership properties shall constitute the profits, which
shall be divided equally between husband and wife,
unless a different proportion or division was agreed
upon in the marriage settlement or unless there has
been a voluntary waiver or forfeiture of such share as
provided in this Code." In this particular case, however,
there had been no marriage settlement between the
parties, nor had there been any voluntary waiver or
valid forfeiture of the defendant wife’s share in the
conjugal partnership properties. The previous cession
and transfer by the plaintiff of his one-half (1/2) share
in their residential house and lot covered by T.C.T. No.
S-35680 of the Registry of Deeds of Parañaque, Metro
Manila, in favor of the defendant as stipulated in their
Compromise Agreement dated July 12, 1993, and
approved by the Court in its Partial Decision dated
August 6, 1993, was actually intended to be in full
settlement of any and all demands for past support. In
reality, the defendant wife had allowed some
concession in favor of the plaintiff husband, for were
the law strictly to be followed, in the process of
liquidation of the conjugal assets, the conjugal dwelling
and the lot on which it is situated shall, unless
otherwise agreed upon by the parties, be adjudicated
to the spouse with whom their only child has chosen to
remain (Art. 129, par. 9). Here, what was done was
one-half (1/2) portion of the house was ceded to
defendant so that she will not claim anymore for past
unpaid support, while the other half was transferred to
their only child as his presumptive legitime.
Consequently, nothing yet has been given to the
defendant wife by way of her share in the conjugal
properties, and it is but just, lawful and fair, that she be
given one-half (1/2) share of the separation/retirement
benefits received by the plaintiff the same being part of
their conjugal partnership properties having been
obtained or derived from the labor, industry, work or
profession of said defendant husband in accordance
with Art. 117, par. 2 of the Family Code. For the same
reason, she is entitled to one-half (1/2) of the
outstanding shares of stock of the plaintiff husband
with the Manila Memorial Park and the Provident
Group of Companies.22
The Court of Appeals articulated on this matter as
follows:
On Assignment of Error E, plaintiff-appellant assails
the order of the trial court for him to give one-half of his
separation/retirement benefits from Far East Bank &
Trust Company and half of his outstanding shares in
Manila Memorial Park and Provident Group of
Companies to the defendant-appellee as the latter’s
share in the conjugal partnership.
On August 6, 1993, the trial court rendered a Partial
Decision approving the Compromise Agreement
entered into by the parties. In the same Compromise
Agreement, the parties had agreed that henceforth,
their conjugal partnership is dissolved. Thereafter, no
steps were taken for the liquidation of the conjugal
partnership.
Finding that defendant-appellee is entitled to at least
half of the separation/retirement benefits which
plaintiff-appellant received from Far East Bank & Trust
Company upon his retirement as Vice-President of said
company for the reason that the benefits accrued from
plaintiff–appellant’s service for the bank for a number
of years, most of which while he was married to
defendant-appellee, the trial court adjudicated the
same. The same is true with the outstanding shares of
plaintiff-appellant in Manila Memorial Park and
Provident Group of Companies. As these were
acquired by the plaintiff-appellant at the time he was
married to defendant-appellee, the latter is entitled to
one-half thereof as her share in the conjugal
partnership. We find no reason to disturb the ruling of
the trial court.23
Since the present case does not involve the annulment
of a bigamous marriage, the provisions of Article 50 in
relation to Articles 41, 42 and 43 of the Family Code,
providing for the dissolution of the absolute community
or conjugal partnership of gains, as the case may be,
do not apply. Rather, the general rule applies, which is
that in case a marriage is declared void ab initio, the
128
property regime applicable and to be liquidated,
partitioned and distributed is that of equal co-
ownership.
In Valdes v. Regional Trial Court, Branch 102, Quezon
City,24 this Court expounded on the consequences of a
void marriage on the property relations of the spouses
and specified the applicable provisions of law:
The trial court correctly applied the law. In a void
marriage, regardless of the cause thereof, the property
relations of the parties during the period of cohabitation
is governed by the provisions of Article 147 or Article
148, such as the case may be, of the Family Code.
Article 147 is a remake of Article 144 of the Civil Code
as interpreted and so applied in previous cases; it
provides:
ART. 147. When a man and a woman who are
capacitated to marry each other, live exclusively with
each other as husband and wife without the benefit of
marriage or under a void marriage, their wages and
salaries shall be owned by them in equal shares and
the property acquired by both of them through their
work or industry shall be governed by the rules on co-
ownership.
In the absence of proof to the contrary, properties
acquired while they lived together shall be presumed to
have been obtained by their joint efforts, work or
industry, and shall be owned by them in equal shares.
For purposes of this Article, a party who did not
participate in the acquisition by the other party of any
property shall be deemed to have contributed jointly in
the acquisition thereof if the former's efforts consisted
in the care and maintenance of the family and of the
household.
Neither party can encumber or dispose by acts inter
vivos of his or her share in the property acquired during
cohabitation and owned in common, without the
consent of the other, until after the termination of their
cohabitation.
When only one of the parties to a void marriage is in
good faith, the share of the party in bad faith in the co-
ownership shall be forfeited in favor of their common
children. In case of default of or waiver by any or all of
the common children or their descendants, each
vacant share shall belong to the respective surviving
descendants. In the absence of descendants, such
share shall belong to the innocent party. In all cases,
the forfeiture shall take place upon termination of the
cohabitation.
This peculiar kind of co-ownership applies when a man
and a woman, suffering no legal impediment to marry
each other, so exclusively live together as husband
and wife under a void marriage or without the benefit
of marriage. The term "capacitated" in the provision (in
the first paragraph of the law) refers to thelegal
capacity of a party to contract marriage, i.e., any "male
or female of the age of eighteen years or upwards not
under any of the impediments mentioned in Articles 37
and 38" of the Code.
Under this property regime, property acquired by both
spouses through their work and industry shall be
governed by the rules on equal co-ownership. Any
property acquired during the union is prima facie
presumed to have been obtained through their joint
efforts. A party who did not participate in the acquisition
of the property shall still be considered as having
contributed thereto jointly if said party's "efforts
consisted in the care and maintenance of the family
household." Unlike the conjugal partnership of gains,
the fruits of the couple's separate property are not
included in the co-ownership.
Article 147 of the Family Code, in substance and to the
above extent, has clarified Article 144 of the Civil Code;
in addition, the law now expressly provides that —
(a) Neither party can dispose or encumber by act[s]
inter vivos [of] his or her share in co-ownership
property, without the consent of the other, during the
period of cohabitation; and
(b) In the case of a void marriage, any party in bad faith
shall forfeit his or her share in the co-ownership in favor
of their common children; in default thereof or waiver
by any or all of the common children, each vacant
share shall belong to the respective surviving
descendants, or still in default thereof, to the innocent
party. The forfeiture shall take place upon the
termination of the cohabitation or declaration of nullity
of the marriage.
… of Article 147 and Article 148 of the Family Code. It
In deciding to take further cognizance of the issue on
the settlement of the parties' common property, the trial
court acted neither imprudently nor precipitately; a
court which had jurisdiction to declare the marriage a
nullity must be deemed likewise clothed with authority
to resolve incidental and consequential matters. Nor
did it commit a reversible error in ruling that petitioner
and private respondent own the "family home" and all
their common property in equal shares, as well as in
concluding that, in the liquidation and partition of the
property owned in common by them, the provisions on
co-ownership under the Civil Code, not Articles 50, 51
and 52, in relation to Articles 102 and 129, of the Family
Code, should aptly prevail. The rules set up to govern
the liquidation of either the absolute community or the
conjugal partnership of gains, the property regimes
recognized for valid and voidable marriages (in the
latter case until the contract is annulled), are irrelevant
to the liquidation of the co-ownership that exists
between common-law spouses. The first paragraph of
Article 50 of the Family Code, applying paragraphs (2),
(3), (4) and (5) of Article 43, relates only, by its explicit
terms, to voidable marriages and, exceptionally,
to void marriages under Article 40 of the Code, i.e., the
declaration of nullity of a subsequent marriage
contracted by a spouse of a prior void marriage before
the latter is judicially declared void. The latter is a
special rule that somehow recognizes the philosophy
and an old doctrine that void marriages are inexistent
from the very beginning and no judicial decree is
necessary to establish their nullity. In now requiring
for purposes of remarriage, the declaration of nullity by
final judgment of the previously contracted void
marriage, the present law aims to do away with any
continuing uncertainty on the status of the second
marriage. It is not then illogical for the provisions of
Article 43, in relation to Articles 41 and 42, of the Family
Code, on the effects of the termination of a subsequent
marriage contracted during the subsistence of a
previous marriage to be made applicable pro hac vice.
In all other cases, it is not to be assumed that the law
has also meant to have coincident property relations,
on the one hand, between spouses in valid and
voidable marriages (before annulment) and, on the
other, between common-law spouses or spouses of
void marriages, leaving to ordain, in the latter case, the
ordinary rules on co-ownership subject to the provision
must be stressed, nevertheless, even as it may merely
129
state the obvious, that the provisions of the Family parties’ son, Javy Singh Buenaventura, is now MOOT (4) Adultery or concubinage;
Code on the "family home," i.e., the provisions found in and ACADEMIC and is, accordingly, DISMISSED.
Title V, Chapter 2, of the Family Code, remain in force (5) Illegal or arbitrary detention or arrest;
and effect regardless of the property regime of the No costs.
(6) Illegal search;
spouses.25
SO ORDERED.
(7) Libel, slander or any other form of defamation;
Since the properties ordered to be distributed by the
Davide, Jr., C.J., (Chairman), Quisumbing, Ynares-
court a quo were found, both by the trial court and the (8) Malicious prosecution;
Santiago, and Carpio, JJ., concur.
Court of Appeals, to have been acquired during the
union of the parties, the same would be covered by the (9) Acts mentioned in article 309;
co-ownership. No fruits of a separate property of one
of the parties appear to have been included or involved (10) Acts and actions referred to in articles 21, 26, 27,
in said distribution. The liquidation, partition and Footnotes 28, 29, 30, 32, 34, and 35.
distribution of the properties owned in common by the
parties herein as ordered by the court a quo should,
1 Rollo (G.R. No.127449), p. 54. ...
therefore, be sustained, but on the basis of co- 2 18Santos v. Court of Appeals, G.R. No. 112019, 4
ownership and not of the regime of conjugal Rollo (G.R. No. 127449), p. 76.
January 1995, 240 SCRA 20, 34. Emphasis supplied.
partnership of gains. 3 Rollo (G.R. No. 127358), pp. 7-8.
19Article 2229. Exemplary or corrective damages are
As to the issue on custody of the parties over their only 4 Id. at 136. imposed by way of example or correction for the public
child, Javy Singh Buenaventura, it is now moot since good, in addition to the moral, temperate, liquidated or
he is about to turn twenty-five years of age on May 27, 5 Id. at 138. compensatory damages.
200526 and has, therefore, attained the age of majority.
6 Id. at 144. 20 Rollo (G.R. No. 127449), p. 67.
With regard to the issues on support raised in the
7
Petition for Certiorari, these would also now be moot, Id. at 153. 21 Id. at 82.
owing to the fact that the son, Javy Singh 8
Buenaventura, as previously stated, has attained the G.R. No. 127449. 22 Rollo (G.R. No. 127449), pp. 69 -71.
age of majority. 9 G.R. No. 127358. 23 Id. at 82-83.
WHEREFORE, the Decision of the Court of Appeals 10 Rollo (G.R. No. 127449), p. 100. 24 G.R. No. 122749, 31 July 1996, 260 SCRA 221.
dated October 8, 1996 and its Resolution dated
December 10, 1996 which are contested in the Petition 11 Id. at 32. 25 Id. at 226-234. (Emphasis in the original.)
for Review (G.R. No. 127449), are hereby MODIFIED,
in that the award of moral and exemplary damages, 12 Rollo (G. R. No.127358) p. 11. 26Javy Singh Buenaventura was born on May 27,
attorney’s fees, expenses of litigation and costs are 1980; Rollo (G.R. No. 127449), p. 56.
13
deleted. The order giving respondent one-half of the Id. at 15.
retirement benefits of petitioner from Far East Bank 14
and Trust Co. and one-half of petitioner’s shares of Id. at 17.
stock in Manila Memorial Park and in the Provident 15 Id. at 20.
Group of Companies is sustained but on the basis of
the liquidation, partition and distribution of the co- 16 Rollo (G.R. No. 127449), pp. 81-82.
ownership and not of the regime of conjugal
17
partnership of gains. The rest of said Decision and ART. 2219. Moral damages may be recovered in the
Resolution are AFFIRMED. following and analogous cases:

The Petition for Review on Certiorari (G.R. No.
127358) contesting the Court of Appeals’ Resolutions
of September 2, 1996 and November 13, 1996 which
increased the support pendente lite in favor of the
(1) A criminal offense resulting in physical injuries;
(2) Quasi-delicts causing physical injuries;
(3) Seduction, abduction, rape, or other lascivious acts;
130
 PERALTA, J.:

For this Court's consideration is the Petition for Review

on Certiorari under Rule 45, dated November 9, 2006,
of petitioner Filinvest Land, Inc., which seeks to set
aside the Decision1 dated March 30, 2006 and
Resolution2dated September 18, 2006 of the Court of
Appeals (CA) partially reversing the Decision 3 dated
October 1, 2003 of the Regional Trial Court, Las Piñas,
Branch 253 (RTC).

The factual antecedents, as found in the records follow.

Respondents were grantees of agricultural public lands

located in Tambler, General Santos City through
Homestead and Fee patents sometime in 1986 and
1991 which are covered by and specifically described
in the following Original Certificates of Title issued by
the Register of Deeds of General Santos City:

OCT Area Date

Grantee
No. (sq. m.) Granted

P- Abdul Backy November

38,328
5204 Ngilay 11, 1986

P- Hadji Gulam November

49,996
5205 Ngilay 11, 1986

P- Edris A. November
49,875
Republic of the Philippines 5206 Ngilay 11, 1986
SUPREME COURT
Manila P- Robayca A. November
44,797
THIRD DIVISION 5207 Ngilay 11, 1986

G.R. No. 174715 October 11, 2012 P- November

20,000 Omar Ngilay
FILINVEST LAND, INC., EFREN C. GUTIERRE and 5209 11, 1986
LINA DE GUZMAN-FERRER, Petitioners,
vs. P- Tayba November
ABDUL BACKY, ABEHERA, BAIYA, EDRIS, HADJI 29,990
5211 Ngilay 11, 1986
GULAM, JAMELLA, KIRAM, LUCAYA, MONER,
OMAR, RAMIR, ROBAYCA, SATAR, TAYBA ALL
SURNAMED NGILAY, EDMER ANDONG, UNOS P- November
48,055 Kiram Ngilay
BANTANGAN and NADJER 5212 11, 1986
ESQUIVEL, Respondents.

DECISION
131
 P- Nadjer November petitioner, respondents came to know that the sale of properties to be purchased. The dispositive portion of
20,408 their properties was null and void, because it was done the Decision dated October 1, 2003 reads:
5578 Esquevel 24, 1991
within the period that they were not allowed to do so
and that the sale did not have the approval of the WHEREFORE, premises considered, the Court
P- Unos November Secretary of the Department of Environment and upholds the sale of all the properties in litigation. It
35,093 likewise upholds the grant of right of way in favor of the
5579 Bantangan 24, 1991 Natural Resources (DENR) prompting them to file a
case for the declaration of nullity of the deeds of respondent. Consequently, the petition is DISMISSED.
P- Moner November conditional and absolute sale of the questioned
39,507 No pronouncement as to damages for failure to prove
5580 Ngilay 24, 1991 properties and the grant of right of way with the RTC,
the same.
Las Piñas, Branch 253.
Costs against the petitioners.
P- November On the other hand, petitioner claims that sometime in
44,809 Baiya Ngilay 1995, the representative of Hadji Ngilay approached
5582 24, 1991 SO ORDERED.4
petitioner to propose the sale of a portion of his
properties. Thereafter, representatives of petitioner Respondents elevated the case to the CA in which the
P- Jamela November flew to General Santos City from Manila to conduct an
10,050 latter modified the judgment of the RTC.1âwphi1 While
5583 Ngilay 24, 1991 ocular inspection of the subject properties. Petitioner the CA upheld the validity of the sale of the properties
was willing to purchase the properties but seeing that the patents of which were awarded in 1986, including
P- November some of the properties were registered as land grants the corresponding grant of right of way for the same
49,993 Ramir Ngilay through homestead patents, representatives of
5584 24, 1991 lots, it nullified the disposition of those properties
petitioner informed Ngilay that they would return to granted through patents in 1991 and the right of way
General Santos City in a few months to finalize the sale on the same properties. As to the "1991 Patents," the
P- November as ten (10) certificates of title were issued on
40,703 Satar Ngilay CA ruled that the contract of sale between the parties
5586 24, 1991 November 24, 1991. was a perfected contract, hence, the parties entered
into a prohibited conveyance of a homestead within the
P- Abehara November According to petitioner, Ngilay and his children prohibitive period of five years from the issuance of the
20,000 prevailed upon the representatives of petitioner to
5590 Ngilay 24, 1991 patent. The CA Decision dated March 30, 2006
make an advance payment. To accommodate the disposed the case as follows:
Ngilays, petitioner acceded to making an advance with
P- Lucaya November the understanding that petitioner could demand WHEREFORE, the assailed Decision dated October 1,
41,645
5592 Ngilay 24, 1991 anytime the return of the advance payment should 2003 is MODIFIED:
Ngilay not be able to comply with the conditions of the
P- Edmer November sale. The Ngilays likewise undertook to secure the a) The Deed of Conditional Sale and Deed of Absolute
13,168 necessary approvals of the DENR before the Sale for the properties covered by the "1991 Patents",
5595 Andong 24, 1991
consummation of the sale. as well as the Right of Way Agreement thereto, are
declared null and void. The Register of Deeds of
Negotiations were made by petitioner, represented by The RTC ruled in favor of Filinvest Land, Inc. and General Santos City is consequently directed to cancel
Lina de Guzman-Ferrer with the patriarch of the upheld the sale of all the properties in litigation. It found the certificates of title covered by the "1991 Patents"
Ngilays, Hadji Gulam Ngilay sometime in 1995. that the sale of those properties whose original issued in favor of appellee Filinvest and to issue new
Eventually, a Deed of Conditional Sale of the above- certificates of title were issued by virtue of the 1986 titles in favor of herein appellants.
enumerated properties in favor of petitioner Filinvest Patents was valid, considering that the prohibitory
Land, Inc. was executed. Upon its execution, period ended in 1991, or way before the transaction b) The sale of the properties covered by the "1986
respondents were asked to deliver to petitioner the took place. As to those patents awarded in 1991, the Patents", including the corresponding grant of way for
original owner's duplicate copy of the certificates of title same court opined that since those properties were the said lots, are declared valid.
of their respective properties. Respondents received subject of a deed of conditional sale, compliance with
the downpayment for the properties on October 28, those conditions is necessary for there to be a SO ORDERED.5
1995. perfected contract between the parties. The RTC also Petitioners filed a Motion for Partial Reconsideration,
A few days after the execution of the aforestated deeds upheld the grant of right of way as it adjudged that the but it was denied by the CA.
and the delivery of the corresponding documents to right of way agreement showed that the right of way
was granted to provide access from the highway to the Hence, the present petition.
132
The grounds relied upon are:
1.
A CONDITIONAL SALE INVOLVING THE 1991
PATENTS DID NOT VIOLATE THE PROHIBITION
AGAINST ALIENATION OF HOMESTEADS UNDER
THE PUBLIC LAND ACT SINCE NO ACTUAL
TRANSFER OR DISPOSITION WAS PERFECTED
UNTIL ALL THE CONDITIONS OF THE DEED ARE
FULFILLED.
2.
REGISTRATION IS THE OPERATIVE ACT THAT
CONVEYS OR DISPOSES RIGHTS IN REAL
PROPERTY. BEING UNREGISTERED, THE DEED
OF CONDITIONAL SALE DID NOT CONVEY OR
DISPOSE OF THE 1991 HOMESTEADS OR ANY
RIGHTS THEREIN IN VIOLATION OF THE PUBLIC
LAND ACT.
3.
ASSUMING THE NULLITY OF THE SALE OF THE
1991 PATENTS, THE HONORABLE COURT OF
APPEALS SHOULD HAVE ORDERED
RESPONDENTS AS A MATTER OF LAW TO
RETURN TO PETITIONERS WHAT THEY HAVE
RECEIVED.6
In their Comment7 dated March 5, 2007, respondents
stated the following counter-arguments:
(1) The Honorable Court of Appeals did not err in
holding that the Deed of Conditional Sale and Deed of
Absolute Sale for the properties covered by the 1991
Patents, as well as the Right of Way Agreement thereto
is null and void for the simplest reason that the said
transactions were volatile of the Public Land Act.
(2) The questions raised by the Petitioner, Filinvest
Land Inc. (FLI) are unsubstantial to require
consideration.8
In its Reply9 dated July 30, 2007, petitioner insists that
the prohibition against alienation and disposition of
land covered by Homestead Patents is a prohibition
against the actual loss of the homestead within the five-
year prohibitory period, not against all contracts
including those that do not result in such an actual loss
of ownership or possession. It also points out that
respondents themselves admit that the transfer
certificates of title covering the ten parcels of land are
all dated 1998, which confirms its declaration that the
lands covered by 1991 Homestead Patents were not
conveyed to Filinvest until after the five-year prohibitory
period.
The petition is unmeritorious.
The five-year prohibitory period following the issuance
of the homestead patent is provided under Section 118
of Commonwealth Act No. 141, as amended by
Commonwealth Act No. 456, otherwise known as the
Public Land Act.10 It bears stressing that the law was
enacted to give the homesteader or patentee every
chance to preserve for himself and his family the land
that the State had gratuitously given to him as a reward
for his labour in cleaning and cultivating it. 11 Its basic
objective, as the Court had occasion to stress, is to
promote public policy that is to provide home and
decent living for destitute, aimed at providing a class of
independent small landholders which is the bulwark of
peace and order.12 Hence, any act which would have
the effect of removing the property subject of the patent
from the hands of a grantee will be struck down for
being violative of the law.13
In the present case, the negotiations for the purchase
of the properties covered by the patents issued in 1991
were made in 1995 and, eventually, an undated Deed
of Conditional Sale was executed. On October 28,
1995, respondents received the downpayment of
P14,000.000.00 for the properties covered by the
patents issued in 1991. Applying the five-year
prohibition, the properties covered by the patent issued
on November 24, 1991 could only be alienated after
November 24, 1996. Therefore, the sale, having been
consummated on October 28, 1995, or within the five-
year prohibition, is as ruled by the CA, void.
Petitioner argues that the correct formulation of the
issue is not whether there was a perfected contract
between the parties during the period of prohibition, but
whether by such deed of conditional sale there was
"alienation or encumbrance" within the contemplation
of the law. This is wrong. The prohibition does not
distinguish between consummated and executory sale.
The conditional sale entered into by the parties is still a
conveyance of the homestead patent. As correctly
ruled by the CA, citing Ortega v. Tan:14
And, even assuming that the disputed sale was not yet
perfected or consummated, still, the transaction cannot
be validated. The prohibition of the law on the sale or
encumbrance of the homestead within five years after
the grant is MANDATORY. The purpose of the law is
to promote a definite policy, i.e., "to preserve and keep
in the family of the homesteader that portion of the
public land which the State has gratuitously given to
him." Thus, the law does not distinguish between
executory and consummated sales. Where the sale of
a homestead was perfected within the prohibitory
period of five years, the fact that the formal deed of sale
was executed after the expiration of the staid period
DID NOT and COULD NOT legalize a contract that was
void from its inception. To hold valid such arrangement
would be to throw the door open to all possible
fraudulent subterfuges and schemes which persons
interested in the land given to a homesteader may
devise in circumventing and defeating the legal
provisions prohibiting their alienation within five years
from the issuance of the patent.15
To repeat, the conveyance of a homestead before the
expiration of the five-year prohibitory period following
the issuance of the homestead patent is null and void
and cannot be enforced, for it is not within the
competence of any citizen to barter away what public
policy by law seeks to preserve.16
Nevertheless, petitioner does not err in seeking the
return of the down payment as a consequence of the
sale having been declared void. The rule is settled that
the declaration of nullity of a contract which is void ab
initio operates to restore things to the state and
condition in which they were found before the
execution thereof.17Petitioner is correct in its argument
that allowing respondents to keep the amount received
from petitioner is tantamount to judicial acquiescence
to unjust enrichment. Unjust enrichment exists "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."18 There is unjust
enrichment under Article 22 of the Civil Code when (1)
a person is unjustly benefited, and (2) such benefit is
derived at the expense of or with damages to
another.19 Thus, the sale which created the obligation
133
of petitioner to pay the agreed amount having been Pursuant to Section 13, Article VIII of the Constitution years after issuance of title shall be valid without the
declared void, respondents have the duty to return the and the Division Chairperson's Attestation, I certify approval of the Secretary of Agriculture and
down payment as they no longer have the right to keep that the conclusions in the above Decision had been Commerce, which approval shall not be denied except
it. The principle of unjust enrichment essentially reached in consultation before the case was assigned on constitutional and legal grounds. (Emphasis
contemplates payment when there is no duty to pay, to the writer or the opinion of the Court's Division. supplied)
and the person who receives the payment has no right
MARIA LOURDES P. A. SERENO 11
to receive it.20 As found by the CA and undisputed by Flore v. Marciano Bagaoisan, G.R. No. 173365, April
the parties, the amount or the down payment made is Chief Justice 15, 2010, 618 SCRA 323, 330, citing Heirs of Venancio
P14,000,000.00 which shall also be the amount to be Bajenting v. Bañez, G.R. No. 166190, September 20,
returned by respondents. 2006, 502 SCRA 531, 553.
12
WHEREFORE, the Petition for Review on Certiorari Id.
Footnotes
dated November 9, 2006 or petitioner Filinvest Land, 13 Id.
Inc. is hereby DENIED. Consequently, the Decision *Designated Acting Member, per Special Order No.
dated March 30, 2006 and Resolution dated 1299 dated August 28, 2012. 14G.R. No. 44617, January 23, 1990, 181 SCRA 350;
September 18, 2006 or the Court of Appeals are 260 Phil. 371 (1990).
hereby AFFIRMED with the MODIFICATION that 1Penned by Associate Justice Vicente S.E. Veloso,
respondents return the amount of P14,000,000.00 15
with Associate Justices Portia Aliño-Hormachuelos Rollo, pp. 53-54. (Emphasis supplied)
given by petitioner as down payment for the sale which and Amelita G. Tolentino, concurring; rollo. pp. 40-57.
16
is ruled to be void ab initio. Saltiga de Romero v. Court of Appeals, G.R. No.
2 Id. at 60-62. 109307, November 25, 1999, 319 SCRA 180, 192; 377
SO ORDERED. Phil. 189, 201.
3Penned by Presiding Judge Jose F. Caoibe, Jr., id. at
DIOSDADO M. PERALTA 335-343. 17Development Bank of the Philippines v. CA, et al.,
Associate Justice G.R. No. 110053, October 16, 1995, 249 SCRA 331,
4 Rollo, pp. 342-343. 337; 319 Phil. 447, 454-455 (1995).
WE CONCUR:
5
Id. at 56-57. (Emphasis supplied) 18Car Cool Philippines, Inc. v. Ushio Realty and
PRESBITERO J. VELASCO, JR. Development Corporation, G.R. No. 138088, January
6
Associate Justice Id. at 21-22.
23, 2006, 479 SCRA 404, 412; 515 Phil. 376, 384
Chairperson 7 (2006).
Id. at 428-437.
JOSE PORTUGAL 8
19H.L. Carlos Corporation, Inc. v. Marina Properties
ROBERTO A. ABAD Id. at 428.
PEREZ* Corporation, G.R. No. 147614, January 29, 2004, 421
Associate Justice
Associate Justice 9 Id. at 445-455. SCRA 428, 437, citing MC Engineering, Inc. v. Court of
Appeals, G.R. No. 104047, April 3, 2002, 380 SCRA
JOSE CATRAL MENDOZA 10 Sec. 118. Except in favor of the Government or any 116, 138; 466 Phil. 182, 197 (2004).
Associate Justice of its branches, units, or institutions, lands acquired
20
under free patent or homestead provisions shall not be Gil Miguel T. Puyat v. Ron Zabarte, G.R. No.
ATTESTATION 141536. February 26, 2001, 352 SCRA 738, 750: 405
subject to encumbrance or alienation from the date of
I attest that the conclusions in the above Decision had the approval of the application and for a term of five Phil. 413, 431 (2001).
been reached in consultation before the case was years from and after the date of issuance of the patent
assigned to the writer of the opinion or the Court's or grant, nor shall they become liable to the satisfaction
Division. of any debt contracted prior to the expiration of said
period, but the improvements or crops on the land may
PRESBITERO J. VELASCO, JR. be mortgaged or pledged to qualified persons,
Associate Justice associations, or corporations.
Chairperson, Third Division
No alienation, transfer, or conveyance of any
CERTIFICATION homestead after five years and before twenty-five

134
 any relief, cannot prevent a recovery if doing so
violates the public policy against unjust enrichment.

Antecedents

After the Department of Public Works and Highways

(DPWH) had awarded on July 22, 1997 the contract for
the improvement of the Sadsadan-Maba-ay Section of
the Mountain Province-Benguet Road in the total
amount of 7 014 963 33 to his company, Gonzalo
Construction,1 petitioner Domingo Gonzalo (Gonzalo)
subcontracted to respondent John Tarnate, Jr.
(Tarnate) on October 15, 1997, the supply of materials
and labor for the project under the latter s business
known as JNT Aggregates. Their agreement
stipulated, among others, that Tarnate would pay to
Gonzalo eight percent and four percent of the contract
price, respectively, upon Tarnate s first and second
billing in the project.2

In furtherance of their agreement, Gonzalo executed

on April 6, 1999 a deed of assignment whereby he, as
the contractor, was assigning to Tarnate an amount
equivalent to 10% of the total collection from the DPWH
for the project. This 10% retention fee (equivalent
to P233,526.13) was the rent for Tarnate’s equipment
that had been utilized in the project. In the deed of
assignment, Gonzalo further authorized Tarnate to use
the official receipt of Gonzalo Construction in the
processing of the documents relative to the collection
of the 10% retention fee and in encashing the check to
be issued by the DPWH for that purpose.3 The deed of
Republic of the Philippines assignment was submitted to the DPWH on April 15,
SUPREME COURT 1999. During the processing of the documents for the
Manila retention fee, however, Tarnate learned that Gonzalo
had unilaterally rescinded the deed of assignment by
FIRST DIVISION
means of an affidavit of cancellation of deed of
G.R. No. 160600 January 15, 2014 assignment dated April 19, 1999 filed in the DPWH on
April 22, 1999;4 and that the disbursement voucher for
DOMINGO GONZALO, Petitioner, the 10% retention fee had then been issued in the
vs. name of Gonzalo, and the retention fee released to
JOHN TARNATE, JR., Respondent. him.5

DECISION Tarnate demanded the payment of the retention fee

BERSAMIN, J.:
The doctrine of in pari delicto which stipulates that the
guilty parties to an illegal contract are not entitled to
from Gonzalo, but to no avail. Thus, he brought this suit
against Gonzalo on September 13, 1999 in the
Regional Trial Court (RTC) in Mountain Province to
recover the retention fee of P233,526.13, moral and
exemplary damages for breach of contract, and
attorney’s fees.6
135
In his answer, Gonzalo admitted the deed of
assignment and the authority given therein to Tarnate,
but averred that the project had not been fully
implemented because of its cancellation by the DPWH,
and that he had then revoked the deed of assignment.
He insisted that the assignment could not stand
independently due to its being a mere product of the
subcontract that had been based on his contract with
the DPWH; and that Tarnate, having been fully aware
of the illegality and ineffectuality of the deed of
assignment from the time of its execution, could not go
to court with unclean hands to invoke any right based
on the invalid deed of assignment or on the product of
such deed of assignment.7
Ruling of the RTC
On January 26, 2001, the RTC, opining that the deed
of assignment was a valid and binding contract, and
that Gonzalo must comply with his obligations under
the deed of assignment, rendered judgment in favor of
Tarnate as follows:
WHEREFORE, premises considered and as prayed for
by the plaintiff, John Tarnate, Jr. in his Complaint for
Sum of Money, Breach of Contract With Damages is
hereby RENDERED in his favor and against the above-
named defendant Domingo Gonzalo, the Court now
hereby orders as follows:
1. Defendant Domingo Gonzalo to pay the Plaintiff,
John Tarnate, Jr., the amount of TWO HUNDRED
THIRTY THREE THOUSAND FIVE HUNDRED
TWENTY SIX and 13/100 PESOS (P233,526.13)
representing the rental of equipment;
2. Defendant to pay Plaintiff the sum of THIRTY
THOUSAND (P30,000.00) PESOS by way of
reasonable Attorney’s Fees for having
forced/compelled the plaintiff to litigate and engage the
services of a lawyer in order to protect his interest and
to enforce his right. The claim of the plaintiff for
attorney’s fees in the amount of FIFTY THOUSAND
PESOS (P50,000.00) plus THREE THOUSAND
PESOS (P3,000.00) clearly appears to be
unconscionable and therefore reduced to Thirty
Thousand Pesos (P30,000.00) as aforestated making
the same to be reasonable;
3. Defendant to pay Plaintiff the sum of FIFTEEN
THOUSAND PESOS (P15,000.00) by way of litigation
expenses;
4. Defendant to pay Plaintiff the sum of TWENTY
THOUSAND PESOS (P20,000.00) for moral damages
and for the breach of contract; and
5. To pay the cost of this suit.
Award of exemplary damages in the instant case is not
warranted for there is no showing that the defendant
acted in a wanton, fraudulent, reckless, oppressive or
malevolent manner analogous to the case of Xentrex
Automotive, Inc. vs. Court of Appeals, 291 SCRA 66.8
Gonzalo appealed to the Court of Appeals (CA).
Decision of the CA
On February 18, 2003, the CA affirmed the RTC.9
Although holding that the subcontract was an illegal
agreement due to its object being specifically
prohibited by Section 6 of Presidential Decree No.
1594; that Gonzalo and Tarnate were guilty of entering
into the illegal contract in violation of Section 6 of
Presidential Decree No. 1594; and that the deed of
assignment, being a product of and dependent on the
subcontract, was also illegal and unenforceable, the
CA did not apply the doctrine of in pari delicto,
explaining that the doctrine applied only if the fault of
one party was more or less equivalent to the fault of the
other party. It found Gonzalo to be more guilty than
Tarnate, whose guilt had been limited to the execution
of the two illegal contracts while Gonzalo had gone to
the extent of violating the deed of assignment. It
declared that the crediting of the 10% retention fee
equivalent to P233,256.13 to his account had unjustly
enriched Gonzalo; and ruled, accordingly, that Gonzalo
should reimburse Tarnate in that amount because the
latter’s equipment had been utilized in the project.
Upon denial of his motion for
reconsideration,10 Gonzalo has now come to the Court
to seek the review and reversal of the decision of the
CA.
Issues
Gonzalo contends that the CA erred in affirming the
RTC because: (1) both parties were in pari delicto; (2)
the deed of assignment was void; and (3) there was no
compliance with the arbitration clause in the
subcontract.
Gonzalo submits in support of his contentions that the
subcontract and the deed of assignment, being
specifically prohibited by law, had no force and effect;
that upon finding both him and Tarnate guilty of
violating the law for executing the subcontract, the RTC
and the CA should have applied the rule of in pari
delicto, to the effect that the law should not aid either
party to enforce the illegal contract but should leave
them where it found them; and that it was erroneous to
accord to the parties relief from their predicament.11
Ruling
We deny the petition for review, but we delete the grant
of moral damages, attorney’s fees and litigation
expenses.
There is no question that every contractor is prohibited
from subcontracting with or assigning to another
person any contract or project that he has with the
DPWH unless the DPWH Secretary has approved the
subcontracting or assignment. This is pursuant to
Section 6 of Presidential Decree No. 1594, which
provides:
Section 6. Assignment and Subcontract. – The
contractor shall not assign, transfer, pledge,
subcontract or make any other disposition of the
contract or any part or interest therein except with the
approval of the Minister of Public Works,
Transportation and Communications, the Minister of
Public Highways, or the Minister of Energy, as the case
may be. Approval of the subcontract shall not relieve
the main contractor from any liability or obligation
under his contract with the Government nor shall it
create any contractual relation between the
subcontractor and the Government.
Gonzalo, who was the sole contractor of the project in
question, subcontracted the implementation of the
project to Tarnate in violation of the statutory
prohibition. Their subcontract was illegal, therefore,
because it did not bear the approval of the DPWH
Secretary. Necessarily, the deed of assignment was
136
also illegal, because it sprung from the subcontract. As
aptly observed by the CA:
x x x. The intention of the parties in executing the Deed
of Assignment was merely to cover up the illegality of
the sub-contract agreement. They knew for a fact that
the DPWH will not allow plaintiff-appellee to claim in his
own name under the Sub-Contract Agreement.
Obviously, without the Sub-Contract Agreement there
will be no Deed of Assignment to speak of. The
illegality of the Sub-Contract Agreement necessarily
affects the Deed of Assignment because the rule is that
an illegal agreement cannot give birth to a valid
contract. To rule otherwise is to sanction the act of
entering into transaction the object of which is
expressly prohibited by law and thereafter execute an
apparently valid contract to subterfuge the illegality.
The legal proscription in such an instance will be easily
rendered nugatory and meaningless to the prejudice of
the general public.12
Under Article 1409 (1) of the Civil Code, a contract
whose cause, object or purpose is contrary to law is a
void or inexistent contract. As such, a void contract
cannot produce a valid one.13 To the same effect is
Article 1422 of the Civil Code, which declares that "a
contract, which is the direct result of a previous illegal
contract, is also void and inexistent."
We do not concur with the CA’s finding that the guilt of
Tarnate for violation of Section 6 of Presidential Decree
No. 1594 was lesser than that of Gonzalo, for, as the
CA itself observed, Tarnate had voluntarily entered into
the agreements with Gonzalo.14 Tarnate also admitted
that he did not participate in the bidding for the project
because he knew that he was not authorized to
contract with the DPWH.15 Given that Tarnate was a
businessman who had represented himself in the
subcontract as "being financially and organizationally
sound and established, with the necessary personnel
and equipment for the performance of the project," 16 he
justifiably presumed to be aware of the illegality of his
agreements with Gonzalo. For these reasons, Tarnate
was not less guilty than Gonzalo.
According to Article 1412 (1) of the Civil Code, the
guilty parties to an illegal contract cannot recover from
one another and are not entitled to an affirmative relief
because they are in pari delicto or in equal fault. The
doctrine of in pari delicto is a universal doctrine that
holds that no action arises, in equity or at law, from an
illegal contract; no suit can be maintained for its
specific performance, or to recover the property agreed
to be sold or delivered, or the money agreed to be paid,
or damages for its violation; and where the parties are
in pari delicto, no affirmative relief of any kind will be
given to one against the other.17
Nonetheless, the application of the doctrine of in pari
delicto is not always rigid.1âwphi1 An accepted
exception arises when its application contravenes well-
established public policy.18 In this jurisdiction, 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."19
Unjust enrichment exists, according to Hulst v. PR
Builders, Inc.,20 "when a person unjustly retains a
benefit at the loss of another, or when a person retains
money or property of another against the fundamental
principles of justice, equity and good conscience." The
prevention of unjust enrichment is a recognized public
policy of the State, for Article 22 of the Civil Code
explicitly provides that "[e]very 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." It is well to note that Article 22
"is part of the chapter of the Civil Code on Human
Relations, the provisions of which were formulated as
basic principles to be observed for the rightful
relationship between human beings and for the stability
of the social order; designed to indicate certain norms
that spring from the fountain of good conscience;
guides for human conduct that should run as golden
threads through society to the end that law may
approach its supreme ideal which is the sway and
dominance of justice."21
There is no question that Tarnate provided the
equipment, labor and materials for the project in
compliance with his obligations under the subcontract
and the deed of assignment; and that it was Gonzalo
as the contractor who received the payment for his
contract with the DPWH as well as the 10% retention
fee that should have been paid to Tarnate pursuant to
the deed of assignment.22 Considering that Gonzalo
refused despite demands to deliver to Tarnate the
stipulated 10% retention fee that would have
compensated the latter for the use of his equipment in
the project, Gonzalo would be unjustly enriched at the
expense of Tarnate if the latter was to be barred from
recovering because of the rigid application of the
doctrine of in pari delicto. The prevention of unjust
enrichment called for the exception to apply in
Tarnate’s favor. Consequently, the RTC and the CA
properly adjudged Gonzalo liable to pay Tarnate the
equivalent amount of the 10% retention fee
(i.e., P233,526.13).
Gonzalo sought to justify his refusal to turn over
the P233,526.13 to Tarnate by insisting that he
(Gonzalo) had a debt of P200,000.00 to Congressman
Victor Dominguez; that his payment of the 10%
retention fee to Tarnate was conditioned on Tarnate
paying that debt to Congressman Dominguez; and that
he refused to give the 10% retention fee to Tarnate
because Tarnate did not pay to Congressman
Dominguez.23 His justification was unpersuasive,
however, because, firstly, Gonzalo presented no proof
of the debt to Congressman Dominguez; secondly, he
did not competently establish the agreement on the
condition that supposedly bound Tarnate to pay to
Congressman Dominguez;24 and, thirdly, burdening
Tarnate with Gonzalo’s personal debt to Congressman
Dominguez to be paid first by Tarnate would constitute
another case of unjust enrichment.
The Court regards the grant of moral damages,
attorney’s fees and litigation expenses to Tarnate to be
inappropriate. We have ruled that no damages may be
recovered under a void contract, which, being
nonexistent, produces no juridical tie between the
parties involved.25 It is notable, too, that the RTC and
the CA did not spell out the sufficient factual and legal
justifications for such damages to be granted.
Lastly, the letter and spirit of Article 22 of the Civil Code
command Gonzalo to make a full reparation or
compensation to Tarnate. The illegality of their contract
should not be allowed to deprive Tarnate from being
fully compensated through the imposition of legal
interest. Towards that end, interest of 6% per annum
reckoned from September 13, 1999, the time of the
judicial demand by Tarnate, is imposed on the amount
of P233,526.13. Not to afford this relief will make a
travesty of the justice to which Tarnate was entitled for
137
having suffered too long from Gonzalo’s unjust 5 Id. at 9-10.
enrichment.
6 Id. at 1-4.
WHEREFORE, we AFFIRM the decision promulgated
7
on February 18, 2003, but DELETE the awards of Id. at 50-52.
moral damages, attorney’s fees and litigation 8 Id. at 110-120.
expenses; IMPOSE legal interest of 6% per annum on
the principal oLP233,526.13 reckoned from September 9 Rollo, pp. 16-34; penned by Associate Justice
13, 1999; and DIRECT the petitioner to pay the costs Remedios A. Salazar-Fernando, and concurred in by
of suit. Associate Justice Ruben T. Reyes (later Presiding
Justice and a Member of the Court, but already retired)
SO ORDERED.
and Associate Justice Edgardo F. Sundiam
LUCAS P. BERSAMIN (retired/deceased).
Associate Justice 10
Id. at 36.
WE CONCUR: 11 Id. at 8-12.
MARIA LOURDES P. A. SERENO 12 Rollo, p. 30.
Chief Justice
13Nool v. Court of Appeals, G.R. No. 116635, July 24,
TERESITA J.
MARTIN S. 1997, 276 SCRA 149, 157.
LEONARDO-DE
VILLARAMA, JR.
CASTRO 14 Rollo, p. 31-32.
Associate Justice
Associate Justice
15 TSN, July 24, 2000, pp. 23-24.
BIENVENIDO L. REYES
16
Associate Justice Records, p. 26.
17
CERTIFICATION Rellosa v. Gaw Chee Hun, 93 Phil. 827, 831 (1953).
18
Pursuant to Section 13, Article VIII of the Constitution, Pajuyo v. Court of Appeals, G.R. No. 146364, June
I certify that the conclusions in the above Decision 3, 2004, 430 SCRA 492, 515.
had been reached in consultation before the case was 19
assigned to the writer of the opinion of the Court's Avon Cosmetics, Incorporated v. Luna, G.R. No.
Division. 153674, December 20, 2006, 511 SCRA 376, 393-394.
20
MARIA LOURDES P. A. SERENO G.R. No. 156364, September 3, 2007, 532 SCRA 74.
Chief Justice 21 Id. at 96.
22
TSN, August 28, 2000, pp. 44, 64, 70, and 71.
23 Id. at 46-50.
Footnotes
24
1 Id. at 51-54.
Records, pp. 88-90.
25
2 Hulst v. PR Builders, Inc., supra note 20, at 94-95;
Id. at 26-28.
Menchavez v. Teves, Jr., G.R. No. 153201, January
3 Id. at 5-6. 26, 2005, 449 SCRA 380, 398-399.

4 Id. at 8.

138
 G.R. No. 180832 July 23, 2008

JEROME CASTRO, Petitioner,

vs.
PEOPLE OF THE PHILIPPINES, Respondent.

RESOLUTION

CORONA, J.:

This petition for review on certiorari1 emanated from

the complaint for grave oral defamation2 filed by Albert
P. Tan against petitioner Jerome Castro.

The facts follow.

On November 11, 2002, Reedley International School

(RIS) dismissed Tan’s son, Justin Albert (then a Grade
12 student), for violating the terms of his disciplinary
probation.3 Upon Tan’s request, RIS reconsidered its
decision but imposed "non-appealable" conditions
such as excluding Justin Albert from participating in the
graduation ceremonies.

Aggrieved, Tan filed a complaint in the Department of

Education (Dep-Ed) for violation of the Manual of
Regulation of Private Schools, Education Act of 1982
and Article 19 of the Civil Code4 against RIS. He
alleged that the dismissal of his son was undertaken
with malice, bad faith and evident premeditation. After
investigation, the Dep-Ed found that RIS’ code violation
point system allowed the summary imposition of
unreasonable sanctions (which had no basis in fact
and in law). The system therefore violated due
process. Hence, the Dep-Ed nullified it.5

Meanwhile, on November 20, 2002, the Dep-Ed

ordered RIS to readmit Justin Albert without any
condition.6Thus, he was able to graduate from RIS and
participate in the commencement ceremonies held on
March 30, 2003.

After the graduation ceremonies, Tan met Bernice C.

Ching, a fellow parent at RIS. In the course of their
conversation, Tan intimated that he was contemplating
a suit against the officers of RIS in their personal
Republic of the Philippines
capacities, including petitioner who was the assistant
SUPREME COURT
headmaster.
Manila
Ching telephoned petitioner sometime the first week of
FIRST DIVISION
April and told him that Tan was planning to sue the

139
officers of RIS in their personal capacities. Before they
hung up, petitioner told Ching:
Okay, you too, take care and be careful talking to [Tan],
that’s dangerous.
Ching then called Tan and informed him that petitioner
said "talking to him was dangerous."
Insulted, Tan filed a complaint for grave oral
defamation in the Office of the City Prosecutor of
Mandaluyong City against petitioner on August 21,
2003.
On November 3, 2003, petitioner was charged with
grave oral defamation in the Metropolitan Trial Court
(MeTC) of Mandaluyong City, Branch 607 under the
following Information:
That on or about the 13th day of March, 2003 in the
City of Mandaluyong, Philippines, a place within the
jurisdiction of this Honorable Court, the above-named
[petitioner], with deliberate intent of bringing ATTY.
ALBERT P. TAN, into discredit, dishonor, disrepute
and contempt, did then and there, willfully, unlawfully
and feloniously speak and utter the following words to
Ms. Bernice C. Ching:
"OK, YOU TOO, YOU TAKE CARE AND BE
CAREFUL TALKING TO [TAN], THAT’S
DANGEROUS."
and other words of similar import of a serious and
insulting nature.
CONTRARY TO LAW.
Petitioner pleaded not guilty during arraignment.
The prosecution essentially tried to establish that
petitioner depicted Tan as a "dangerous person."
Ching testified that petitioner warned her that talking to
Tan was dangerous. Tan, on the other hand, testified
that petitioner’s statement shocked him as it portrayed
him as "someone capable of committing undesirable
acts." He added that petitioner probably took offense
because of the complaint he filed against RIS in the
Dep-Ed.
For his defense, petitioner denied harboring ill-feelings
against Tan despite the latter’s complaint against RIS
in the Dep-Ed. Although he admitted conversing with
Ching (whom he considered as a close acquaintance)
on the telephone a few days after RIS’ 2003
commencement exercises, petitioner asserted that he
never said or insinuated that Tan or talking to Tan was
dangerous. On cross-examination, however, he did not
categorically deny the veracity of Ching’s statement.
The MeTC found that Ching’s statements in her
affidavit and in open court were consistent and that she
did not have any motive to fabricate a false statement.
Petitioner, on the other hand, harbored personal
resentment, aversion and ill-will against Tan since the
Dep-Ed compelled RIS to readmit his son. Thus, the
MeTC was convinced that petitioner told Ching talking
to Tan was dangerous and that he uttered the
statement with the intention to insult Tan and tarnish
his social and professional reputation.
In a decision dated December 27, 2005, the MeTC
found petitioner guilty beyond reasonable doubt of
grave oral defamation:8
WHEREFORE, judgment is hereby rendered finding
accused, Jerome Castro GUILTY beyond reasonable
doubt of the crime of Grave Oral Defamation,
sentencing him therefore, in accordance to Article
358(1) of the Revised Penal Code and applying the
Indeterminate Sentence Law to suffer the penalty of
imprisonment of 1 month and 1 day of arresto
mayor as minimum to 4 months and 1 day of arresto
mayor as maximum.
On appeal, the Regional Trial Court (RTC) affirmed the
factual findings of the MeTC. However, in view of the
animosity between the parties, it found petitioner guilty
only of slight oral defamation. But because Tan filed his
complaint in the Office of the City Prosecutor of
Mandaluyong City only on August 21, 2003 (or almost
five months from discovery), the RTC ruled that
prescription had already set in; it therefore acquitted
petitioner on that ground. 9
On April 19, 2007, the Office of the Solicitor General
(OSG) filed a petition for certiorari in the Court of
Appeals (CA) assailing the decision of the RTC.10 It
contended that the RTC acted with grave abuse of
discretion when it downgraded petitioner’s offense to
slight oral defamation. The RTC allegedly
misappreciated the antecedents which provoked
petitioner to utter the allegedly defamatory statement
against Tan.
The CA found that the RTC committed grave abuse of
discretion when it misapprehended the totality of the
circumstances and found petitioner guilty only of slight
oral defamation. Thus, the CA reinstated the MeTC
decision.11
Petitioner moved for reconsideration but it was
denied.12 Hence, this recourse.
Petitioner basically contends that the CA erred in
taking cognizance of the petition for certiorari inasmuch
as the OSG raised errors of judgment (i.e., that the
RTC misappreciated the evidence presented by the
parties) but failed to prove that the RTC committed
grave abuse of discretion. Thus, double jeopardy
attached when the RTC acquitted him.
We grant the petition.
No person shall be twice put in jeopardy of punishment
for the same offense.13 This constitutional mandate is
echoed in Section 7 of Rule 117 of the Rules of Court
which provides:
Section 7. Former conviction or acquittal; double
jeopardy. – When an accused has been convicted or
acquitted or the case against him dismissed or
otherwise terminated without his express consent by a
court of competent jurisdiction, upon a valid complaint
or in information or other formal charge sufficient in
form and substance to sustain a conviction and after
the accused had pleaded to the charge, the conviction
or acquittal of the accused or the dismissal of the case
shall be a bar to another prosecution for the offense
charged or for any attempt to commit the same or
frustration thereof, or for any offense which necessarily
includes or is necessarily included in the offense
charged in the former complaint or information.
xxx xxx xxx
Under this provision, double jeopardy occurs upon (1)
a valid indictment (2) before a competent court (3) after
arraignment (4) when a valid plea has been entered
and (5) when the accused was acquitted or convicted
or the case was dismissed or otherwise terminated
without the express consent of the accused.14 Thus, an
acquittal, whether ordered by the trial or appellate
140
court, is final and unappealable on the ground of xxx xxx xxx
double jeopardy.15
The only exception is when the trial court acted with
grave abuse of discretion or, as we held in Galman v. (3) Intriguing to cause another to be alienated from
Sandiganbayan,16 when there was mistrial. In such his friends;
instances, the OSG can assail the said judgment in a
petition for certiorari establishing that the State was xxx xxx xxx
deprived of a fair opportunity to prosecute and prove its
case.17 Petitioner is reminded that, as an educator, he is
supposed to be a role model for the youth. As such, he
should always act with justice, give everyone his due
The rationale behind this exception is that a judgment
rendered by the trial court with grave abuse of and observe honesty and good faith.22
discretion was issued without jurisdiction. It is, for this
reason, void. Consequently, there is no double WHEREFORE, the petition is hereby GRANTED. The
jeopardy. August 29, 2007 decision and December 5, 2007
resolution of the Court of Appeals in CA-G.R. SP No.
In this case, the OSG merely assailed the RTC’s 98649 are REVERSED and SET ASIDE. The
finding on the nature of petitioner’s statement, that is, November 20, 2006 decision of the Regional Trial
whether it constituted grave or slight oral defamation. Court of Mandaluyong City, Branch 212
The OSG premised its allegation of grave abuse of is REINSTATED. Petitioner Jerome Castro
discretion on the RTC’s "erroneous" evaluation and is ACQUITTED of slight oral defamation as defined
assessment of the evidence presented by the and penalized in Article 358 of the Revised Penal
parties.1awph!1 Code.
What the OSG therefore questioned were errors of No pronouncement as to costs.
judgment (or those involving misappreciation of
evidence or errors of law). However, a court, in a SO ORDERED.
petition for certiorari, cannot review the public
RENATO C. CORONA
respondent’s evaluation of the evidence and factual Associate Justice
findings.18 Errors of judgment cannot be raised in a
Rule 65 petition as a writ of certiorari can only correct WE CONCUR:
errors of jurisdiction (or those involving the commission
of grave abuse of discretion).19 REYNATO S. PUNO
Chief Justice
Because the OSG did not raise errors of jurisdiction, Chairperson
the CA erred in taking cognizance of its petition and,
worse, in reviewing the factual findings of the ANTONIO T. CARPIO ADOLFO S. AZCUNA
RTC.20 We therefore reinstate the RTC decision so as Associate Justice Associate Justice
not to offend the constitutional prohibition against
double jeopardy. TERESITA J. LEONARDO-DE CASTRO
Associate Justice
At most, petitioner could have been liable for damages
under Article 26 of the Civil Code21 : CERTIFICATION
Article 26. Every person shall respect the dignity, Pursuant to Section 13, Article VIII of the Constitution,
personality, privacy and peace of mind of his neighbors I certify that the conclusions in the above resolution
and other persons. The following and similar acts, had been reached in consultation before the case was
though they may not constitute a criminal offense, shall assigned to the writer of the opinion of the Court’s
produce a cause of action for damages, prevention and Division.
other relief:
REYNATO S. PUNO
Chief Justice
Footnotes
1 Under Rule 45 of the Rules of Court.
2
Revised Penal Code, Art. 358 provides:
Article 358. Slander. Oral defamation shall be
punished by arresto mayor in its maximum period
toprision correccional in its minimum period if it is of a
serious and insulting nature; otherwise, the penalty
shall be arresto menor or a fine not exceeding 200
pesos.
3
Letter of RIS directress Nellie Aquino-Ong to Mr. and
Mrs. Albert Tan. Rollo, p. 301. According to RIS, Justin
Albert accumulated 34 code violations including public
display of affection and conduct unbecoming of a
gentleman. The maximum number of code violation
was 25.
4 Article 19. Every person must, in the exercise of his
rights and in the performance of his duties, act with
justice, give everyone his due, and observe honesty
and good faith.
5Dep-Ed decision penned by Corazon D. Santiago,
Director IV. Dated July 28, 2003. Rollo, pp. 321-331.
6Letter of Dep-Ed Director IV Corazon D. Santiago. Id.,
p. 141.
7 Docketed as Criminal Case No. 93541.
8
Decision penned by Judge Lizabeth Gutierrez-
Torres. Rollo, pp. 214-221.
9
Decision penned by Judge Rizalina T. Capco-Umali
of the RTC of Mandaluyong City, Branch 212. Dated
November 20, 2006. Id., pp. 438-448.
10 Docketed as CA-G.R. SP No. 98649.
11Decision penned by Associate Justice Remedio A.
Salazar-Fernandez and concurred by Associate
Justices Rosalinda Asuncion-Vicente and Enrico A.
141
Lanzanas (retired) of the Seventh Division of the Court THIRD dIVISION
of Appeals. Dated August 29, 2007. Rollo, pp. 56-63.
G.R. No. L-54598 April 15, 1988
12 Resolution dated December 5, 2007. Id., p. 65.
JOSE B. LEDESMA, petitioner,
13 Constitution, Art. III, Sec. 21. vs.
HON. COURT OF APPEALS, Spouses PACIFICO
14Metropolitan Bank and Trust Co. v. Veridiano, 427 DELMO and SANCHA DELMO (as private
Phil. 795, 803 (2001). respondents),respondents.
15 People v. Velasco, 394 Phil. 517, 554-556 (2000). The Solicitor General for petitioner.
16 228 Phil. 42 (1986). Luzel D. Demasu-ay for respondent.
17Yuchengco v. Court of Appeals, 427 Phil. 11, 24
(2002).
GUTIERREZ, JR., J.:
18 Id.
This petition seeks to reverse the decision of the
19 Yuchengco v. Court of Appeals, supra note 17 at 23. respondent Court of Appeals which afirmed the
20 decision of the Court of First Instance of Iloilo,
See People v. Velasco, supra note 15 at 560-561.
adjudging the petitioner, who was then the President of
21This action would have been a complaint for the West Visayas College liable for damages under
damages based on a quasi-delict, subject to Article Article 27 of the Civil Code of the Philippines for failure
1146 of the Civil Code. to graduate a student with honors.

22 Civil Code, Art. 19, supra note 4. The facts are not disputed.

An organization named Student Leadership Club was

formed by some students of the West Visayas College.
They elected the late Violets Delmo as the treasurer.
In that capacity, Delmo extended loans from the funds
of the club to some of the students of the school. "the
petitioner claims that the said act of extending loans
was against school rules and regulations. Thus, the
petitioner, as President of the School, sent a letter to
Delmo informing her that she was being dropped from
the membership of the club and that she would not be
a candidate for any award or citation from the school.

Delmo asked for a reconsideration of the decision but

the petitioner denied it. Delmo, thus, appealed to the
Office of the Director of the Bureau of Public Schools.

The Director after due investigation, rendered a

decison on April 13, 1966 which provided:

Records of the preliminary investigation conducted by

Republic of the Philippines one of the legal officers of this Office disclosed the
SUPREME COURT following: That Violeta Delmo was the treasurer of the
Manila Student Leadership Club, an exclusive student
organization; that pursuant to Article IX of the of the
142
Constitution and By-Laws of the club, it passed
Resolution No. 2, authorizing the treasurer to disburse
funds of the Club to student for financial aid and other
humanitarian purposes; that in compliance with said
resolution and as treasurer of the Club, Violeta Delmo
extended loans to some officers and members of the
Club upon proper application duly approved by the
majority of the members of the Executive Board; and
that upon receiving the report from Mr. Jesse Dagoon,
adviser of the funds of the Club, that Office conducted
an investigation on the matter and having been
convinced of the guilt of Violets Delmo and the other
officers and members of the Club, that Office rendered
the order or decision in question. In justifying that
Office's order or decision, it is contended that approval
by that Office of the Constitution and By-Laws of the
Club is necessary for its effectivity and validity and
since it was never submitted to that Office, the Club
had no valid constitution and By-Laws and that as a
consequence, Resolution No. 2 which was passed
based on the Constitution and By-Laws- is without any
force and effect and the treasurer, Violeta Delmo, who
extended loans to some officers and members of the
Club pursuant thereto are illegal (sic), hence, she and
the other students involved are deemed guilty of
misappropriating the funds of the Club. On the other
hand, Raclito Castaneda, Nestor Golez and Violeta
Delmo, President, Secretary and Treasurer of the Club,
respectively, testified that the Club had adopted its
Constitution and By-Laws in a meeting held last
October 3, 1965, and that pursuant to Article I of said
Constitution and By-Laws, the majority of the members
of the Executive Board passed Resolution No. 2, which
resolution became the basis for the extension on of
loans to some officers and members of the Club, that
the Club honestly believed that its Constitution and By-
Laws has been approved by the superintendent
because the adviser of the Club, Mr. Jesse Dagoon,
assured the President of the Club that he will cause the
approval of the Constitution and By-Laws by the
Superintendent; the officers of the Club have been
inducted to office on October 9,1965 by the
Superintendent and that the Club had been likewise
allowed to cosponsor the Education Week Celebration.
After a careful study of the records, this Office sustains
the action taken by the Superintendent in penalizing
the adviser of the Club as well as the officers and
members thereof by dropping them from membership
therein. However, this Office is convinced that Violets
M. Delmo had acted in good faith, in her capacity as
Club Treasurer, in extending loans to the officers and
members of the Student partnership Club. Resolution
No. 2 authorizing the Club treasurer to discharge finds
to students in need of financial assistance and other
humanitarian purposes had been approved by the Club
adviser, Mr. Jesse Dagoon, with the notation that
approval was given in his capacity as adviser of the
Club and extension of the Superintendent's
personality. Aside from misleading the officers and
members of the Club, Mr. Dagoon, had unsatisfactorily
explained why he failed to give the Constitution and By-
Laws of the Club to the Superintendent for approval
despite his assurance to the Club president that he
would do so. With this finding of negligence on the part
of the Club adviser, not to mention laxity in the
performance of his duties as such, this Office considers
as too severe and unwarranted that portion of the
questioned order stating that Violeta Delmo "shall not
be a candidate for any award or citation from this
school or any organization in this school." Violeta
Delmo, it is noted, has been a consistent full scholar of
the school and she alone has maintained her
scholarship. The decision in question would, therefore,
set at naught all her sacrifice and frustrate her dreams
of graduating with honors in this year's commencement
exercises.
In view of all the foregoing, this Office believes and so
holds and hereby directs that appellant Violeta. M.
Delmo, and for that matter all other Club members or
officers involved in this case, be not deprived of any
award, citation or honor from the school, if they are
otherwise entitled thereto. (Rollo, pp. 28-30)
On April 27, 1966, the petitioner received by mail the
decision of the Director and all the records of the case.
On the same day, petitioner received a telegram
stating the following:
"AIRMAIL RECORDS DELMO CASE MISSENT THAT
OFFICE"
The Director asked for the return only of the records
but the petitioner allegedly mistook the telegram as
ordering him to also send the decision back. On the
same day, he returned by mail all the records plus the
decision of the Director to the Bureau of Public
Schools.
The next day, the petitioner received another telegram
from the Director order him to furnish Delmo with a
copy of the decision. The petitioner, in turn, sent a night
letter to the Director informing the latter that he had
sent the decision back and that he had not retained a
copy thereof..
On May 3, 1966, the day of the graduation, the
petitioner received another telegram from the Director
ordering him not to deprive Delmo of any honors due
her. As it was impossible by this time to include
Delmo's name in the program as one of the honor
students, the petitioner let her graduate as a plain
student instead of being awarded the Latin honor of
Magna Cum Laude.
To delay the matter further, the petitioner on May 5,
1966, wrote the Director for a reconsideration of the
latters" decision because he believed that Delmo
should not be allowed to graduate with honors. The
Director denied the petitioner's request.
On July 12, 1966, the petitioner finally instructed the
Registrar of the school to enter into the scholastic
records of Delmo the honor, "Magna Cum Laude."
On July 30, 1966, Delmo, then a minor, was joined by
her parents in flag action for damages against the
petitioner. During the pendency of the action, however,
Delmo passed away, and thus, an Amended and
Supplemental Complaint was filed by her parents as
her sole and only heirs.
The trial court after hearing rendered judgment against
the petitioner and in favor of the spouses Delmo. The
court said:
Let us go to specific badges of the defendants (now
petitioners) bad faith. Per investigation of Violeta
Delmo's appeal to Director Vitaliano Bernardino of the
Bureau of Public Schools (Exhibit L it was the
defendant who inducted the officers of the Student
Leadership Club on October 9, 1965. In fact the Club
was allowed to cosponsor the Education Week
Celebration. (Exh. "L"). If the defendant he not approve
of the constitution and by-laws of the Club, why did he
induct the officers into office and allow the Club to
sponsor the Education Week Celebration"? It was
through his own act that the students were misled to do
as they did. Coupled with the defendants tacit
143
recognition of the Club was the assurance of Mr. Jemm
Dagoon, Club Adviser, who made the students believe
that he was acting as an extension of Mr. Ledesma's
personality. (Exhibit "L").
Another badge of the defendan'ts want of good faith is
the fact that, although, he kaew as early as April
27,1966 that per on of r Bernardino, Exhibit "L," he was
directed to give honors to Miss Delmo, he kept Id
information to . He told the Court that he knew that the
letter of Director Bernardino directed him not to deprive
Miss Delmo the honors due her, but she (sic) says that
he has not finished reading the letter-decision, Exhibit
"L," of Director Bernardino 0, him to give honors to Miss
Delmo. (Tsn, Feb. 5, 1974, testimony of Mr. Ledesma,
pp. .33-35). It could not be true that he has not finished
reading the letter-decision, Exh. "L," because said
letter consisted of only three pages, and the portion
which directed that Miss Delmo "be not deprived of any
award, citation or honor from the school, if otherwise
entitled thereto is found at the last paragraph of the
same. How did he know the last paragraph if he did not
read the letter.
Defendants actuations regarding Miss Delmo's cam
had been one of bias and prejudice. When his action
would favor him, he was deliberate and aspect to the
utter prejudice and detriment of Miss Delmo. Thus,
although, as early as April 27, 1966, he knew of the
exoneration of Miss Delino by Director Bernardino, he
withheld the information from Miss Delmo. This is
eloquently dramatized by Exh. "11" and Exh. "13" On
April 29,1966, Director Bernardino cabled him to
furnish Violeta Delmo copy of the Decision, Exh. "L,"
but instead of informing Miss Delmo about the
decision, since he said he mailed back the decision on
April 28,1966, he sent a night letter on April 29,1966,
to Director Bernardino, informing the latter that he had
returned the decision (Exh. "l3"), together with the
record. Why a night letter when the matter was of
utmost urgency to the parties in the case, because
graduation day was only four days ahead? An
examination of the telegrams sent by the defendant
shows that he had been sending ordinary telegram and
not night letters. (Exh. "5", Exhibit "7"). At least, if the
defendant could not furnish a copy of the decision,
(Exh. "L"), to Miss Delmo, he should have told her
about it or that Miss Delmo's honors and citation in the
commencement be announced or indicated. But Mr.
Ledesma is one who cannot admit a mistake. Very
ungentlemanly this is home out by his own testimony
despite his knowledge that his decision to deprive Miss
Delmo of honors due to her was overturned by Director
Bernardino, he on his wrong belief. To quote the
defendant,1 believed that she did not deserve those
honors(Tsn Feb. 5, 1974, p. 43,Empasized supplied).
Despite the telegram of Director Bernardino which the
defendant received hours before the commencement
executory on May 3-4,1966, he did not obey Director
Bernardino because he said in his testimony that he
would be embarrassment . Tan Feb 5,1974, P. 46).
Evidently, he knew only his embarrassment and not
that of r Bernardino whose order was being flagrantly
and wantonly disregarded by bim And certainly, not the
least of Miss Delmo's embarrassment. His acts speak
eloquently of ho bad faith and unjust of mindwarped by
his delicate sensitivity for having been challenged by
Miss Delmo, a mere student.
xxx xxx xxx
Finally the defendant's behaviour relative to Miss s
case smacks of contemptuous arrogance, oppression
and abuse of power. Come to think of it. He refused to
obey the directive of Be o and instead, chose to feign
ignorance of it." (Reward on Appeal, p. 72-76).
The trial court awarded P20,000.00 to the estate of
Violeta Delmo and P10,000.00 to her parents for moral
damages; P5,000.00 for nominal damages to Violeta's
estate; exemplary damages of P10,000.00 and
P2,000.00 attorney's fees.
On appeal, the Court of Appeals affirmed the decision.
Hence, this petition.
The issues raised in this petition can be reduced to the
sole question of whether or not the respondent Court
of Appeals erred in affirming the trial court's finding that
petitioner is liable for damages under Article 27 of the
New Civil Code.
We find no reason why the findings of the trial and
appellate courts should be reversed. It cannot be
disputed that Violeta Delmo went through a painful
ordeal which was brought about by the petitioner's
neglect of duty and callousness. Thus, moral damages
are but proper. As we have affirmed in the case of
(Prudenciado v. Alliance Transport System, Inc., 148
SCRA 440, 448):
There is no argument that moral damages include
physical suffering, mental anguish, fright, serious
anxiety, besmirched reputation, wounded feelings,
moral shock, social humiliation, and similar injury.
Though incapable of pecuniary computation, moral
damages may be recovered if they are the proximate
result of defendant's wrongly act or omission." (People
v. Baylon, 129 SCRA 62 (1984).
The Solicitor-General tries to cover-up the petitioner's
deliberate omission to inform Miss Delmo by stating
that it was not the duty of the petitioner to furnish her a
copy of the Director's decision. Granting this to be true,
it was nevertheless the petitioner's duty to enforce the
said decision. He could have done so considering that
he received the decision on April 27, 1966 and even
though he sent it back with the records of the case, he
undoubtedly read the whole of it which consisted of
only three pages. Moreover, the petitioner should have
had the decency to meet with Mr. Delmo, the girl's
father, and inform the latter, at the very least of the
decision. This, the petitioner likewise failed to do, and
not without the attendant bad faith which the appellate
court correctly pointed out in its decision, to wit:
Third, assuming that defendant could not furnish Miss
Delmo of a copy of the decision, he could have used
his discretion and plain common sense by informing
her about it or he could have directed the inclusion of
Miss Delmo's honor in the printed commencement
program or announced it during the commencement
exercises.
Fourth, defendant despite receipt of the telegram of
Director Benardino hours before the commencement
exercises on May 3-4, 1966, disobeyed his superior by
refusing to give the honors due Miss Delmo with a lame
excuse that he would be embarrassed if he did so, to
the prejudice of and in complete disregard of Miss
Delmo's rights.
Fifth, defendant did not even extend the courtesy of
meeting Mr. Pacifico Delmo, father of Miss Delmo, who
tried several times to see defendant in his office thus
Mr. Delmo suffered extreme disappointment and
humiliation.
xxx xxx xxx
144
Defendant, being a public officer should have acted
with circumspection and due regard to the rights of
Miss Delmo. Inasmuch as he exceeded the scope of
his authority by defiantly disobeying the lawful directive
of his superior, Director Bernardino, defendant is liable
for damages in his personal capacity. . . . (Rollo, pp-
57-58)
Based on the undisputed facts, exemplary damages
are also in order. In the same case of Prudenciado v.
Alliance Transport System, Inc., supra., at p. 450, we
ruled:
The rationale behind exemplary or corrective damages
is, as the name implies, to provide an example or
correction for the public good (Lopez, et al. v. Pan
American World Airways, 16 SCRA 431).
However, we do not deem it appropriate to award the
spouses Delmo damages in the amount of P10,000.00
in their individual capacity, separately from and in
addition to what they are already entitled to as sole
heirs of the deceased Violeta Delmo. Thus, the
decision is modified insofar as moral damages are
awarded to the spouses in their own behalf.
WHEREFORE, the petition is DISMISSED for lack of
merit. The decision of the Court of Appeals is
AFFIRMED with the slight modification as stated in the
preceding paragraph. This decision is immediately
executory.
SO ORDERED.
Fernan (Chairman), Feliciano, Bidin and Cortes, JJ.,
concur.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
A.C. No. 8261 March 11, 2015
JESSIE T. CAMPUGAN and ROBERT C.
TORRES, Complainants,
vs.
ATTY. FEDERICO S. TOLENTINO, JR., ATTY.
RENATO G. CUNANAN, ATTY. DANIEL F.
VICTORIO, JR., and ATTY. ELBERT T.
QUILALA, Respondents.
x-----------------------x
A.C. No. 8725
JESSIE T. CAMPUGAN and ROBERT C.
TORRES, Complainants,
vs.
ATTY. CONSTANTE P. CALUYA, JR. and ATTY.
ELBERT T. QUILALA, Respondents.
DECISION
BERSAMIN, J.:
In this consolidated administrative case, complainants
Jessie T. Campugan and Robert C. Torres seek the
disbarment of respondents Atty. Federico S. Tolentino,
Jr., Atty. Daniel F. Victorio, Jr., Atty. Renato G.
Cunanan, Atty. Elbert T. Quilala and Atty. Constante P.
Caluya, Jr. for allegedly falsifying a court order that
became the basis for the cancellation of their
annotation of the notice ofadverse claim and the notice
of lis pendens in the Registry of Deeds in Quezon City.
Antecedents
Atty. Victorio, Jr. had replaced Atty. Edgardo Abad as
counsel of the complainants in a civil action they
brought to seek the annulment of Transfer Certificate
of Title (TCT) No. N-290546 of the Registry of Deeds
of Quezon City in the first week of January 2007 in the
Regional Trial Court (RTC) in Quezon City (Civil Case
No. Q-07-59598). They impleaded as defendants
Ramon and Josefina Ricafort, Juliet Vargas and the
Register of Deeds of Quezon City. They caused to be
annotated on TCT No. N-290546 their affidavit of
adverse claim, as well as the notice of lis
pendens.1 Atty. Tolentino, Jr. was the counsel of
defendant Ramon and Josefina Ricafort.
In their sworn complaint for disbarment dated April 23,
2009 (later docketed as A.C. No. 8261),2 the
complainants narrated that as the surviving children of
the late Spouses Antonio and Nemesia Torres, they
inherited upon the deaths of their parents a residential
lot located at No. 251 Boni Serrano Street, Murphy,
Cubao, Quezon City registered under Transfer
Certificate of Title (TCT) No. RT-64333(35652) of the
Register of Deeds of Quezon City;3that on August 24,
2006, they discovered that TCT No. RT-64333(35652)
had been unlawfully cancelled and replaced by TCT
No. N-290546 of the Register of Deeds of Quezon City
under the names of Ramon and Josefina Ricafort;4 and
that, accordingly, they immediately caused the
annotation of their affidavit of adverse claim on TCT
No. N-290546.
It appears that the parties entered into an amicable
settlement during the pendency of Civil Case No. Q-
07-59598 in order to end their dispute,5 whereby the
complainants agreed to sell the property and the
proceeds thereof would be equally divided between the
parties, and the complaint and counterclaim would be
withdrawn respectively by the complainants (as the
plaintiffs) and the defendants. Pursuant to the terms of
the amicable settlement, Atty. Victorio, Jr. filed a
Motion to Withdraw Complaint dated February 26,
2008,6 which the RTC granted in its order dated May
16, 2008 upon noting the defendants’ lack of objection
thereto and the defendants’ willingness to similarly
withdraw their counterclaim.7
The complainants alleged that from the time of the
issuance by the RTC of the order dated May 16, 2008,
they could no longer locate or contact Atty. Victorio, Jr.
despite making several phone calls and visits to his
office; that they found out upon verification at the
Register of Deeds of Quezon City that new annotations
were made on TCT No. N-290546, specifically: (1) the
annotation of the letter-request appearing to be filed by
Atty. Tolentino, Jr.8seeking the cancellation of the
affidavit of adverse claim and the notice of lis pendens
annotated on TCT No. N-290546; and (2) the
annotation of the decision dated May 16, 2008
rendered in Civil Case No. Q-07-59598 by the RTC,
Branch 95, in Quezon City, granting the complainants’
Motion to Withdraw Complaint;9 and that a copy of the
letter request dated June 30, 2008 addressed to Atty.
Quilala, Registrar of Deeds of Quezon City, disclosed
145
that it was defendant Ramon Ricafort who had signed
the letter.
Feeling aggrieved by their discovery, the complainants
filed an appeal en consulta with the Land Registration
Authority (LRA), docketed as Consulta No. 4707,
assailing the unlawful cancellation of their notice of
adverse claim and their notice of lis pendens under
primary entries PE-2742 and PE-3828-9, respectively.
The LRA set Consulta No. 4707 for hearing on March
30, 2009, and directed the parties to submit their
respective memoranda and/or supporting documents
on or beforesuch scheduled hearing.10 However, the
records do not disclose whether Consulta No. 4707
was already resolved, or remained pending at the LRA.
Unable to receive any response or assistance from
Atty. Victorio, Jr. despite their having paid him for his
professional services, the complainants felt that said
counsel had abandoned their case. They submitted
that the cancellation of their notice of adverse claim
and their notice of lis pendens without a court order
specifically allowing such cancellation resulted from
the connivance and conspiracy between Atty. Victorio,
Jr. and Atty. Tolentino, Jr., and from the taking
advantage of their positions as officials in the Registry
of Deeds by respondents Atty. Quilala, the Chief
Registrar, and Atty. Cunanan, the acting Registrar and
signatory of the new annotations. Thus, they claimed
to be thereby prejudiced.
On July 6, 2009, the Court required the respondents to
comment on the verified complaint.11 Atty. Victorio, Jr.
asserted in his Comment dated August 17, 200912 that
complainant Robert Torres had been actively involved
in the proceedings in Civil Case No. Q-07-59598,
which included the mediation process; that the
complainants, after having aggressively participated in
the drafting of the amicable settlement, could not now
claim that they had been deceived into entering the
agreement in the same way that they could not feign
ignorance of the conditions contained therein; that he
did not commit any abandonment as alleged, but had
performed in good faith his duties as the counsel for
the complainants in Civil Case No. Q-07-59598; that he
should not be held responsible for their representation
in other proceedings, such as that before the LRA,
which required a separate engagement; and that the
only payment he had received from the complainants
were those for his appearance fees of P1,000.00 for
every hearing in the RTC.
In his Comment dated August 24, 2009,13 Atty.
Tolentino, Jr. refuted the charge of conspiracy,
stressing that he was not acquainted with the other
respondents, except Atty. Victorio, Jr. whom he had
met during the hearings in Civil Case No. Q-07-59598;
that although he had notarized the letter request dated
June 30, 2008 of Ramon Ricafort to the Register of
Deeds, he had no knowledge about how said letter-
request had been disposed of by the Register of
Deeds; and that the present complaint was the second
disbarment case filed by the complainants against him
with no other motive except to harass and intimidate
him.
Atty. Quilala stated in his Comment dated September
1, 200914 that it was Atty. Caluya, Jr., another Deputy
Register of Deeds, who was the actual signing
authority of the annotations that resulted in the
cancellation of the affidavit of adverse claim and the
notice of lis pendens on TCT No. N-290546; that the
cancellation of the annotations was undertaken in the
regular course of official duty and in the exercise of the
ministerial duty of the Register of Deeds; that no
irregularity occurred or was performed in the
cancellation of the annotations; and that the Register
of Deeds was impleaded in Civil Case No. Q-07-59598
only as a nominal party, thereby discounting any
involvement in the proceedings in the case.
Atty. Cunanan did not file any comment.15
As the result of Atty. Quilala’s allegation in his
Comment in A.C. No. 8261 that it had been Atty.
Caluya, Jr.’s signature that appeared below the
cancelled entries, the complainants filed another sworn
disbarment complaint dated August 26, 2010 alleging
that Atty. Caluya, Jr. had forged the signature of Atty.
Cunanan.16 This disbarment complaint was docketed
as A.C. No. 8725, and was later on consolidated with
A.C. No. 826117 because the complaints involved the
same parties and rested on similar allegations against
the respondents.
Atty. Quilala filed his Comment in A.C. No. 8725 to
belie the allegation of forgery and to reiterate the
arguments he had made in A.C. No. 8261.18 On his
part, Atty. Caluya, Jr. manifested that he adopted Atty.
Quilala’s Comment.19
Ruling
We dismiss the complaints for disbarment for being
bereft of merit.
Well entrenched in this jurisdiction is the rule that a
lawyer may be disciplined for misconduct committed
either in his professional or private capacity. The test is
whether his conduct shows him to be wanting in moral
character, honesty, probity, and good demeanor, or
whether his conduct renders him unworthy to continue
as an officer of the Court.20 Verily, Canon 7 of the Code
of Professional Responsibility mandates all lawyers to
uphold at all times the dignity and integrity of the Legal
Profession. Lawyers are similarly required under Rule
1.01, Canon 1 of the same Code not to engage in any
unlawful, dishonest and immoral or deceitful conduct.
Failure to observe these tenets of the Code of
Professional Responsibility exposes the lawyer to
disciplinary sanctions as provided in Section 27, Rule
138 of the Rules of Court, as amended, viz.:
Section 27. Disbarment or suspension of attorneys by
Supreme Court, grounds therefor. — A member of the
bar may be disbarred or suspended from his office as
attorney by the Supreme Court for any deceit,
malpractice, or other gross misconduct in such office,
grossly immoral conduct, or by reason of his conviction
of a crime involving moral turpitude, or for any violation
of the oath which he is required to take before the
admission to practice, or for a wilful disobedience
appearing as an attorney for a party to a case without
authority so to do. The practice of soliciting cases at
law for the purpose of gain, either personally or through
paid agents or brokers, constitutes malpractice.
The complainants’ allegations of the respondents’ acts
and omissions are insufficient to establish any
censurable conduct against them.
Section 10 of Presidential Decree No. 1529 (Property
Registration Decree) enumerates the general duties of
the Register of Deeds, as follows:
Section 10. General functions of Registers of Deeds. –
xxx
146
It shall be the duty of the Register of Deeds to
immediately register an instrument presented for
registration dealing with real or personal property
which complies with all the requisites for registration.
He shall see to it that said instrument bears the proper
documentary science stamps and that the same are
properly canceled. If the instrument is not registrable,
he shall forthwith deny registration thereof and inform
the present or of such denial in writing, stating the
ground or reason therefor, and advising him of his right
to appeal by consulta in accordance with Section 117
of this Decree. (Emphasis supplied)
The aforementioned duty of the Register of Deeds is
ministerial in nature.21 A purely ministerial act or duty is
one that an officer or tribunal performs in a given state
of facts, in a prescribed manner, in obedience to the
mandate of a legal authority, without regard to or the
exercise of his own judgment upon the propriety or
impropriety of the act done. If the law imposes a duty
upon a public officer and gives him the right to decide
how or when the duty shall be performed, such duty is
discretionary, not ministerial. The duty is ministerial
only when its discharge requires neither the exercise of
official discretion nor the exercise of judgment.22
In Gabriel v. Register of Deeds of Rizal,23 the Court
underscores that registration is a merely ministerial act
of the Register of Deeds, explaining:
x x x [W]hether the document is invalid, frivolous or
intended to harass, is not the duty of a Register of
Deeds to decide, but a court of competent jurisdiction,
and that it is his concern to see whether the documents
sought to be registered conform with the formal and
legal requirements for such documents.
In view of the foregoing, we find no abuse of authority
or irregularity committed by Atty. Quilala, Atty.
Cunanan, and Atty. Caluya, Jr. with respect to the
cancellation of the notice of adverse claim and the
notice of lis pendens annotated on TCT No. N-290546.
Whether or not the RTC order dated May 16, 2008 or
the letter-request dated June 30,2008 had been
falsified, fraudulent or invalid was not for them to
determine inasmuch as their duty to examine
documents presented for registration was limited only
to what appears on the face of the documents. If, upon
their evaluation of the letter-request and the RTC
order, they found the same to be sufficient in law and
to be in conformity with existing requirements, it
became obligatory for them to perform their ministerial
duty without unnecessary delay.24
Should they be aggrieved by said respondents’
performance of duty, the complainants were not bereft
of any remedy because they could challenge the
performance of duty by bringing the matter by way of
consulta with the LRA, as provided by Section 11725 of
Presidential Decree No. 1529. But, as enunciated in
Gabriel v. Register of Deeds of Rizal,26 it was ultimately
within the province of a court of competent jurisdiction
to resolve issues concerning the validity or invalidity of
a document registered by the Register of Deeds.
The complainants charge Atty. Victorio, Jr. and Atty.
Tolentino, Jr. with having conspired with each other to
guarantee that the parties in Civil Case No. Q-59598
would enter into the amicable settlement, and then to
cause the cancellation of the affidavit of adverse claim
and notice of lis pendens annotated on TCT No. N-
290546. The complainants further fault Atty. Victorio,
Jr. with having abandoned their cause since the
issuance of the RTC of its order dated May 16, 2008.
The complainants’ charges are devoid of substance.
Although it is not necessary to prove a formal
agreement in order to establish conspiracy because
conspiracy may be inferred from the circumstances
attending the commission of an act, it is nonetheless
essential that conspiracy be established by clear and
convincing evidence.27 The complainants failed in this
regard. Outside of their bare assertions that Atty.
Victorio, Jr. and Atty. Tolentino, Jr. had conspired with
each other in order to cause the dismissal of the
complaint and then discharge of the annotations, they
presented no evidence to support their allegation of
conspiracy. On the contrary, the records indicated their
own active participation in arriving at the amicable
settlement with the defendants in Civil Case No. Q-07-
59598. Hence, they could not now turn their backs on
the amicable settlement that they had themselves
entered into.
Even assuming that Atty. Victorio, Jr. and Atty.
Tolentino, Jr. initiated and participated in the
settlement of the case, there was nothing wrong in their
doing so. It was actually their obligation as lawyers to
do so, pursuant to Rule 1.04, Canon 1 of the Code of
Professional Responsibility, viz.:
RULE 1.04 – A lawyer shall encourage his clients to
avoid, end or settle a controversy if it will admit of a fair
settlement.1âwphi1
In fine, the presumption of the validity of the amicable
settlement of the complainants and the defendants in
Civil Case No. Q-07-59598 subsisted.28
Anent the complainants’ charge of abandonment
against Atty. Victorio, Jr., Rule 18.03 and Rule 18.04,
Canon 18 of the Code of Professional Responsibility
are applicable, to wit:
CANON 18 – A lawyer shall serve his client with
competence and diligence.
Rule 18.03 – A lawyer shall not neglecta legal matter
entrusted to him, and his negligence in connection
therewith shall render him liable.
Rule 18.04 – A lawyer shall keep the client informed of
the status of his case and shall respond within a
reasonable time to the client’s request for information.
There is no issue that the complainants engaged the
services of Atty. Victorio, Jr. as their counsel in Civil
Case No. Q-07-59598. Atty. Victorio, Jr. served as
such counsel. With Atty. Victorio, Jr. assistance, the
complainants obtained a fair settlement consisting in
receiving half of the proceeds of the sale of the property
in litis, without any portion of the proceeds accruing to
counsel as his legal fees. The complainants did not
competently and persuasively show any unfaithfulness
on the part of Atty. Victorio, Jr. as far as their interest
in the litigation was concerned. Hence, Atty. Victorio,
Jr. was not liable for abandonment.
Atty. Victorio, Jr. could not be faulted for the perceived
inattention to any other matters subsequent to the
termination of Civil Case No. Q-07-59598. Unless
otherwise expressly stipulated between them at any
time during the engagement, the complainants had no
right to assume that Atty. Victorio, Jr.’s legal
representation was indefinite as to extend to his
representation of them in the LRA. The Law Profession
did not burden its members with the responsibility of
indefinite service to the clients; hence, the rendition of
professional services depends on the agreement
between the attorney and the client. Atty. Victorio, Jr.’s
alleged failure to respond to the complainants’ calls or
visits, or to provide them with his whereabouts to
147
 12
enable them to have access to him despite the Id. at 17-18. made. His resolution or ruling in consultas shall be
termination of his engagement in Civil Case No. Q-07- conclusive and binding upon all Registers of Deeds,
13
59598 did not equate to abandonment without the Id. at 14-15. provided, that the party in interest who disagrees with
credible showing that he continued to come under the 14 the final resolution, ruling or order of the Commissioner
Id. at 28-30.
professional obligation towards them after the relative to consultas may appeal to the Court of
termination of Civil Case No. Q-07-59598. 15 Id. at 52. Appeals within the period and in manner provided in
Republic Act No. 5434. (Bold emphasis supplied)
WHEREFORE, the Court DISMISSES the baseless 16 Rollo, A.C. No. 8725, pp. 1-3. 26
disbarment complaints against Atty. Federico S. Supra note 23.
Tolentino, Jr., Atty. Renato G. Cunanan, Atty. Daniel F. 17 Rollo, A.C. No. 8261, p. 53. 27
Victoria, Jr., Atty. Elbert T. Quilala and Atty. Constante People v. Dagani, G.R. No. 153875, August 16,
18 2006, 499 SCRA 64, 79.
P. Caluya, Jr. Rollo, A.C. No. 8725, pp. 14-18.
19 28
SO ORDERED. Id. at 49-50. Bautista v. Seraph Management Group, Inc., G.R.
No. 174039, June 29, 2010, 622 SCRA 141, 145.
20
LUCAS P. BERSAMIN Tan, Jr. v. Gumba, A.C. No. 9000, October 5, 2011,
Associate Justice 658 SCRA 527, 532; Roa v. Moreno, A.C. No. 8382, Republic of the Philippines
April 21, 2010, 618 SCRA 693, 699. SUPREME COURT
WE CONCUR: Manila
21See Register of Deeds, Pasig, Rizal v. Heirs of Hi
MARIA LOURDES P.A. SERENO Caiji,99 Phil 25, 30 (1956); Ledesma v. Villaseñor, G.R. EN BANC
Chief Justice No. L-18725, March 31, 1965, 13 SCRA 494, 496.

TERESITA J. 22 Mallari v. Government Service Insurance System, et

JOSE PORTUGAL
LEONARDO-DE al., G.R. No. 157659, January 25, 2010, 611 SCRA 32,
PEREZ
CASTRO 49-50; Espiridion v. Court of Appeals, G.R. No.
Associate Justice
Associate Justice 146933, June 8, 2006, 490 SCRA 273, 277.
23
ESTELA M. PERLAS-BERNABE G.R. No. L-17956, September 30, 1963, 9 SCRA
Associate Justice 136, 141.
24
Footnotes Noblejas, Registration of Land Titles and Deeds,
1992 Revised Edition, p.387.
1 Rollo, A.C. No. 8261, p. 7.
25 Section 117. Procedure. – When the Register of
2 Id. at 1-4. Deeds is in doubt with regard to the proper step to be
3 4
taken or memorandum to be made in pursuance of any
Id. at 5. Id. at 6. deed, mortgage or other instrument presented to him
5 Id. at 24-25. for registration, or where any party in interest does not
agree with the action taken by the Register of Deeds
6
Id. at 8-9. with reference to any such instrument, the question
shall be submitted to the Commissioner of Land
7 Id. at 10. Registration by the Register of Deeds, or by the party
8
in interest thru the Register of Deeds.
Id. at 7.
9
xxxx
Id.
10
The Commissioner of Land Registration, considering
Id. at 12. the consulta and the records certified to him after notice
11 to the parties and hearing, shall enter an order
Id. at 13.
prescribing the step to be taken or memorandum to be

148
G.R. No. 102007 September 2, 1994

PEOPLE OF THE PHILIPPINES, plaintiff-appellee,

vs.
ROGELIO BAYOTAS y CORDOVA, accused-
appellant.

The Solicitor General for plaintiff-appellee.

Public Attorney's Office for accused-appellant.

ROMERO, J.:

In Criminal Case No. C-3217 filed before Branch 16,

RTC Roxas City, Rogelio Bayotas y Cordova was
charged with Rape and eventually convicted thereof on
June 19, 1991 in a decision penned by Judge Manuel
E. Autajay. Pending appeal of his conviction, Bayotas
died on February 4, 1992 at
the National Bilibid Hospital due to cardio respiratory
arrest secondary to hepatic encephalopathy secondary
to hipato carcinoma gastric malingering. Consequently,
the Supreme Court in its Resolution of May 20, 1992
dismissed the criminal aspect of the appeal. However,
it required the Solicitor General to file its comment with
regard to Bayotas' civil liability arising from his
commission of the offense charged.

In his comment, the Solicitor General expressed his

view that the death of accused-appellant did not
extinguish his civil liability as a result of his commission
of the offense charged. The Solicitor General, relying
on the case ofPeople v. Sendaydiego 1 insists that the
appeal should still be resolved for the purpose of
reviewing his conviction by the lower court on which the
civil liability is based.

Counsel for the accused-appellant, on the other hand,

opposed the view of the Solicitor General arguing that
the death of the accused while judgment of conviction
is pending appeal extinguishes both his criminal and
civil penalties. In support of his position, said counsel
invoked the ruling of the Court of Appeals in People
149
v. Castillo and Ocfemia 2 which held that the civil
obligation in a criminal case takes root in the criminal
liability and, therefore, civil liability is extinguished if
accused should die before final judgment is rendered.
We are thus confronted with a single issue: Does death
of the accused pending appeal of his conviction
extinguish his civil liability?
In the aforementioned case of People v. Castillo, this
issue was settled in the affirmative. This same issue
posed therein was phrased thus: Does the death of
Alfredo Castillo affect both his criminal responsibility
and his civil liability as a consequence of the alleged
crime?
It resolved this issue thru the following disquisition:
Article 89 of the Revised Penal Code is the controlling
statute. It reads, in part:
Art. 89. How criminal liability is totally extinguished. —
Criminal liability is totally extinguished:
1. By the death of the convict, as to the personal
penalties; and as to the pecuniary penalties liability
therefor is extinguished only when the death of the
offender occurs before final judgment;
With reference to Castillo's criminal liability, there is no
question. The law is plain. Statutory construction is
unnecessary. Said liability is extinguished.
The civil liability, however, poses a problem. Such
liability is extinguished only when the death of the
offender occurs before final judgment. Saddled upon
us is the task of ascertaining the legal import of the
term "final judgment." Is it final judgment as
contradistinguished from an interlocutory order? Or, is
it a judgment which is final and executory?
We go to the genesis of the law. The legal precept
contained in Article 89 of the Revised Penal Code
heretofore transcribed is lifted from Article 132 of the
Spanish El Codigo Penal de 1870 which, in part,
recites:
La responsabilidad penal se extingue.
1. Por la muerte del reo en cuanto a las penas
personales siempre, y respecto a las pecuniarias, solo
cuando a su fallecimiento no hubiere recaido sentencia
firme.
xxx xxx xxx
The code of 1870 . . . it will be observed employs the
term "sentencia firme." What is "sentencia firme" under
the old statute?
XXVIII Enciclopedia Juridica Española, p. 473,
furnishes the ready answer: It says:
SENTENCIA FIRME. La sentencia que adquiere la
fuerza de las definitivas por no haberse utilizado por
las partes litigantes recurso alguno contra ella dentro
de los terminos y plazos legales concedidos al efecto.
"Sentencia firme" really should be understood as one
which is definite. Because, it is only when judgment is
such that, as Medina y Maranon puts it, the crime is
confirmed — "en condena determinada;" or, in the
words of Groizard, the guilt of the accused becomes —
"una verdad legal." Prior thereto, should the accused
die, according to Viada, "no hay legalmente, en tal
caso, ni reo, ni delito, ni responsabilidad criminal de
ninguna clase." And, as Judge Kapunan well
explained, when a defendant dies before judgment
becomes executory, "there cannot be any
determination by final judgment whether or not the
felony upon which the civil action might arise exists,"
for the simple reason that "there is no party defendant."
(I Kapunan, Revised Penal Code, Annotated, p. 421.
Senator Francisco holds the same view. Francisco,
Revised Penal Code, Book One, 2nd ed., pp. 859-860)
The legal import of the term "final judgment" is similarly
reflected in the Revised Penal Code. Articles 72 and
78 of that legal body mention the term "final judgment"
in the sense that it is already enforceable. This also
brings to mind Section 7, Rule 116 of the Rules of Court
which states that a judgment in a criminal case
becomes final "after the lapse of the period for
perfecting an appeal or when the sentence has been
partially or totally satisfied or served, or the defendant
has expressly waived in writing his right to appeal."
By fair intendment, the legal precepts and opinions
here collected funnel down to one positive conclusion:
The term final judgment employed in the Revised
Penal Code means judgment beyond recall. Really, as
long as a judgment has not become executory, it
cannot be truthfully said that defendant is definitely
guilty of the felony charged against him.
Not that the meaning thus given to final judgment is
without reason. For where, as in this case, the right to
institute a separate civil action is not reserved, the
decision to be rendered must, of necessity, cover "both
the criminal and the civil aspects of the case." People
vs. Yusico (November 9, 1942), 2 O.G., No. 100, p.
964. See also: People vs. Moll, 68 Phil., 626,
634; Francisco, Criminal Procedure, 1958 ed., Vol. I,
pp. 234, 236. Correctly, Judge Kapunan observed that
as "the civil action is based solely on the felony
committed and of which the offender might be found
guilty, the death of the offender extinguishes the civil
liability." I Kapunan, Revised Penal Code,
Annotated, supra.
Here is the situation obtaining in the present case:
Castillo's criminal liability is out. His civil liability is
sought to be enforced by reason of that criminal
liability. But then, if we dismiss, as we must, the
criminal action and let the civil aspect remain, we will
be faced with the anomalous situation whereby we will
be called upon to clamp civil liability in a case where
the source thereof — criminal liability — does not exist.
And, as was well stated in Bautista, et al. vs. Estrella,
et al., CA-G.R. No. 19226-R, September 1, 1958, "no
party can be found and held criminally liable in a civil
suit," which solely would remain if we are to divorce it
from the criminal proceeding."
This ruling of the Court of Appeals in
the Castillo case 3 was adopted by the Supreme Court
in the cases of People of the Philippines v. Bonifacio
Alison, et al., 4 People of the Philippines v. Jaime Jose,
et al. 5 and People of the Philippines v.Satorre 6 by
dismissing the appeal in view of the death of the
accused pending appeal of said cases.
As held by then Supreme Court Justice Fernando in
the Alison case:
The death of accused-appellant Bonifacio Alison
having been established, and considering that there is
as yet no final judgment in view of the pendency of the
appeal, the criminal and civil liability of the said
accused-appellant Alison was extinguished by his
death (Art. 89, Revised Penal Code; Reyes' Criminal
Law, 1971 Rev. Ed., p. 717, citing People v. Castillo
150
and Ofemia C.A., 56 O.G. 4045); consequently, the
case against him should be dismissed.
On the other hand, this Court in the subsequent cases
of Buenaventura Belamala v. Marcelino
Polinar 7 andLamberto Torrijos v. The Honorable Court
of Appeals 8 ruled differently. In the former, the issue
decided by this court was: Whether the civil liability of
one accused of physical injuries who died before final
judgment is extinguished by his demise to the extent of
barring any claim therefore against his estate. It was
the contention of the administrator-appellant therein
that the death of the accused prior to final judgment
extinguished all criminal and civil liabilities resulting
from the offense, in view of Article 89, paragraph 1 of
the Revised Penal Code. However, this court ruled
therein:
We see no merit in the plea that the civil liability has
been extinguished, in view of the provisions of the Civil
Code of the Philippines of 1950 (Rep. Act No. 386) that
became operative eighteen years after the revised
Penal Code. As pointed out by the Court below, Article
33 of the Civil Code establishes a civil action for
damages on account of physical injuries,
entirely separate and distinct from the criminal action.
Art. 33. In cases of defamation, fraud, and physical
injuries, a civil action for damages, entirely separate
and distinct from the criminal action, may be brought
by the injured party. Such civil action shall proceed
independently of the criminal prosecution, and shall
require only a preponderance of evidence.
Assuming that for lack of express reservation,
Belamala's civil action for damages was to be
considered instituted together with the criminal action
still, since both proceedings were terminated without
final adjudication, the civil action of the offended party
under Article 33 may yet be enforced separately.
In Torrijos, the Supreme Court held that:
xxx xxx xxx
It should be stressed that the extinction of civil liability
follows the extinction of the criminal liability under
Article 89, only when the civil liability arises from the
criminal act as its only basis. Stated differently, where
the civil liability does not exist independently of the
criminal responsibility, the extinction of the latter by
death, ipso facto extinguishes the former, provided, of
course, that death supervenes before final judgment.
The said principle does not apply in instant case
wherein the civil liability springs neither solely nor
originally from the crime itself but from a civil contract
of purchase and sale. (Emphasis ours)
xxx xxx xxx
In the above case, the court was convinced that the
civil liability of the accused who was charged with
estafa could likewise trace its genesis to Articles 19, 20
and 21 of the Civil Code since said accused had
swindled the first and second vendees of the property
subject matter of the contract of sale. It therefore
concluded: "Consequently, while the death of the
accused herein extinguished his criminal liability
including fine, his civil liability based on the laws of
human relations remains."
Thus it allowed the appeal to proceed with respect to
the civil liability of the accused, notwithstanding the
extinction of his criminal liability due to his death
pending appeal of his conviction.
To further justify its decision to allow the civil liability to
survive, the court relied on the following ratiocination:
Since Section 21, Rule 3 of the Rules of
Court 9 requires the dismissal of all money claims
against the defendant whose death occurred prior to
the final judgment of the Court of First Instance (CFI),
then it can be inferred that actions for recovery of
money may continue to be heard on appeal, when the
death of the defendant supervenes after the CFI had
rendered its judgment. In such case, explained this
tribunal, "the name of the offended party shall be
included in the title of the case as plaintiff-appellee and
the legal representative or the heirs of the deceased-
accused should be substituted as defendants-
appellants."
It is, thus, evident that as jurisprudence evolved from
Castillo to Torrijos, the rule established was that the
survival of the civil liability depends on whether the
same can be predicated on sources of obligations
other than delict. Stated differently, the claim for civil
liability is also extinguished together with the criminal
action if it were solely based thereon, i.e., civil
liability ex delicto.
However, the Supreme Court in People
v. Sendaydiego, et al. 10 departed from this long-
established principle of law. In this case, accused
Sendaydiego was charged with and convicted by the
lower court of malversation thru falsification of public
documents. Sendaydiego's death supervened during
the pendency of the appeal of his conviction.
This court in an unprecedented move resolved to
dismiss Sendaydiego's appeal but only to the extent of
his criminal liability. His civil liability was allowed to
survive although it was clear that such claim thereon
was exclusively dependent on the criminal action
already extinguished. The legal import of such decision
was for the court to continue exercising appellate
jurisdiction over the entire appeal, passing upon the
correctness of Sendaydiego's conviction despite
dismissal of the criminal action, for the purpose of
determining if he is civilly liable. In doing so, this Court
issued a Resolution of July 8, 1977 stating thus:
The claim of complainant Province of Pangasinan for
the civil liability survived Sendaydiego because his
death occurred after final judgment was rendered by
the Court of First Instance of Pangasinan, which
convicted him of three complex crimes of malversation
through falsification and ordered him to indemnify the
Province in the total sum of P61,048.23 (should be
P57,048.23).
The civil action for the civil liability is deemed impliedly
instituted with the criminal action in the absence of
express waiver or its reservation in a separate action
(Sec. 1, Rule 111 of the Rules of Court). The civil action
for the civil liability is separate and distinct from the
criminal action (People and Manuel vs. Coloma, 105
Phil. 1287; Roa vs. De la Cruz, 107 Phil. 8).
When the action is for the recovery of money and the
defendant dies before final judgment in the Court of
First Instance, it shall be dismissed to be prosecuted in
the manner especially provided in Rule 87 of the Rules
of Court (Sec. 21, Rule 3 of the Rules of Court).
The implication is that, if the defendant dies after a
money judgment had been rendered against him by the
Court of First Instance, the action survives him. It may
be continued on appeal (Torrijos vs. Court of Appeals,
L-40336, October 24, 1975; 67 SCRA 394).
151
The accountable public officer may still be civilly liable
for the funds improperly disbursed although he has no
criminal liability (U.S. vs. Elvina, 24 Phil. 230;
Philippine National Bank vs. Tugab, 66 Phil. 583).
In view of the foregoing, notwithstanding the dismissal
of the appeal of the deceased Sendaydiego insofar as
his criminal liability is concerned, the Court Resolved
to continue exercising appellate jurisdiction over his
possible civil liability for the money claims of the
Province of Pangasinan arising from the alleged
criminal acts complained of, as if no criminal case had
been instituted against him, thus making applicable, in
determining his civil liability, Article 30 of the Civil Code
. . . and, for that purpose, his counsel is directed to
inform this Court within ten (10) days of the names and
addresses of the decedent's heirs or whether or not his
estate is under administration and has a duly appointed
judicial administrator. Said heirs or administrator will be
substituted for the deceased insofar as the civil action
for the civil liability is concerned (Secs. 16 and 17, Rule
3, Rules of Court).
Succeeding cases 11 raising the identical issue have
maintained adherence to our ruling in Sendaydiego; in
other words, they were a reaffirmance of our
abandonment of the settled rule that a civil liability
solely anchored on the criminal (civil liability ex delicto)
is extinguished upon dismissal of the entire appeal due
to the demise of the accused.
But was it judicious to have abandoned this old ruling?
A re-examination of our decision
in Sendaydiego impels us to revert to the old ruling.
To restate our resolution of July 8, 1977
in Sendaydiego: The resolution of the civil action
impliedly instituted in the criminal action can proceed
irrespective of the latter's extinction due to death of the
accused pending appeal of his conviction, pursuant to
Article 30 of the Civil Code and Section 21, Rule 3 of
the Revised Rules of Court.
Article 30 of the Civil Code provides:
When a separate civil action is brought to demand civil
liability arising from a criminal offense, and no criminal
proceedings are instituted during the pendency of the
civil case, a preponderance of evidence shall likewise
be sufficient to prove the act complained of.
Clearly, the text of Article 30 could not possibly lend
support to the ruling in Sendaydiego. Nowhere in its
text is there a grant of authority to continue exercising
appellate jurisdiction over the accused's civil liability ex
delictowhen his death supervenes during appeal. What
Article 30 recognizes is an alternative and separate
civil action which may be brought to demand civil
liability arising from a criminal offense independently of
any criminal action. In the event that no criminal
proceedings are instituted during the pendency of said
civil case, the quantum of evidence needed to prove
the criminal act will have to be that which is compatible
with civil liability and that is, preponderance of
evidence and not proof of guilt beyond reasonable
doubt. Citing or invoking Article 30 to justify the survival
of the civil action despite extinction of the criminal
would in effect merely beg the question of whether civil
liability ex delicto survives upon extinction of the
criminal action due to death of the accused during
appeal of his conviction. This is because whether
asserted in
the criminal action or in a separate civil action, civil
liability ex delicto is extinguished by the death of the
accused while his conviction is on appeal. Article 89 of
the Revised Penal Code is clear on this matter:
Art. 89. How criminal liability is totally extinguished. —
Criminal liability is totally extinguished:
1. By the death of the convict, as to the personal
penalties; and as to pecuniary penalties, liability
therefor is extinguished only when the death of the
offender occurs before final judgment;
xxx xxx xxx
However, the ruling in Sendaydiego deviated from the
expressed intent of Article 89. It allowed claims for civil
liability ex delicto to survive by ipso facto treating the
civil action impliedly instituted with the criminal, as one
filed under Article 30, as though no criminal
proceedings had been filed but merely a separate civil
action. This had the effect of converting such claims
from one which is dependent on the outcome of the
criminal action to an entirely new and separate one, the
prosecution of which does not even necessitate the
filing of criminal proceedings. 12One would be hard put
to pinpoint the statutory authority for such a
transformation. It is to be borne in mind that in
recovering civil liability ex delicto, the same has
perforce to be determined in the criminal action, rooted
as it is in the court's pronouncement of the guilt or
innocence of the accused. This is but to render fealty
to the intendment of Article 100 of the Revised Penal
Code which provides that "every person criminally
liable for a felony is also civilly liable." In such cases,
extinction of the criminal action due to death of the
accused pending appeal inevitably signifies the
concomitant extinction of the civil liability. Mors Omnia
Solvi. Death dissolves all things.
In sum, in pursuing recovery of civil liability arising from
crime, the final determination of the criminal liability is
a condition precedent to the prosecution of the civil
action, such that when the criminal action is
extinguished by the demise of accused-appellant
pending appeal thereof, said civil action cannot
survive. The claim for civil liability springs out of and is
dependent upon facts which, if true, would constitute a
crime. Such civil liability is an inevitable consequence
of the criminal liability and is to be declared and
enforced in the criminal proceeding. This is to be
distinguished from that which is contemplated under
Article 30 of the Civil Code which refers to the
institution of a separate civil action that does not draw
its life from a criminal proceeding. The Sendaydiego
resolution of July 8, 1977, however, failed to take note
of this fundamental distinction when it allowed the
survival of the civil action for the recovery of civil
liability ex delicto by treating the same as a separate
civil action referred to under Article 30. Surely, it will
take more than just a summary judicial pronouncement
to authorize the conversion of said civil action to an
independent one such as that contemplated under
Article 30.
Ironically however, the main decision in Sendaydiego
did not apply Article 30, the resolution of July 8, 1977
notwithstanding. Thus, it was held in the main decision:
Sendaydiego's appeal will be resolved only for the
purpose of showing his criminal liability which is the
basis of the civil liability for which his estate would be
liable. 13
In other words, the Court, in resolving the issue of his
civil liability, concomitantly made a determination on
whether Sendaydiego, on the basis of evidenced
adduced, was indeed guilty beyond reasonable doubt
of committing the offense charged. Thus, it upheld
152
Sendaydiego's conviction and pronounced the same
as thesource of his civil liability. Consequently,
although Article 30 was not applied in the final
determination of Sendaydiego's civil liability, there was
a reopening of the criminal action already extinguished
which served as basis for Sendaydiego's civil liability.
We reiterate: Upon death of the accused pending
appeal of his conviction, the criminal action is
extinguished inasmuch as there is no longer a
defendant to stand as the accused; the civil action
instituted therein for recovery of civil liability ex
delicto is ipso facto extinguished, grounded as it is on
the criminal.
Section 21, Rule 3 of the Rules of Court was also
invoked to serve as another basis for
the Sendaydiegoresolution of July 8, 1977. In citing
Sec. 21, Rule 3 of the Rules of Court, the Court made
the inference that civil actions of the type involved
in Sendaydiego consist of money claims, the recovery
of which may be continued on appeal if defendant dies
pending appeal of his conviction by holding his estate
liable therefor. Hence, the Court's conclusion:
"When the action is for the recovery of money" "and the
defendant dies before final judgment in the court of
First Instance, it shall be dismissed to be prosecuted in
the manner especially provided" in Rule 87 of the Rules
of Court (Sec. 21, Rule 3 of the Rules of Court).
The implication is that, if the defendant dies after a
money judgment had been rendered against him by the
Court of First Instance, the action survives him. It may
be continued on appeal.
Sadly, reliance on this provision of law is misplaced.
From the standpoint of procedural law, this course
taken inSendaydiego cannot be sanctioned. As
correctly observed by Justice Regalado:
xxx xxx xxx
I do not, however, agree with the justification advanced
in both Torrijos and Sendaydiego which, relying on the
provisions of Section 21, Rule 3 of the Rules of Court,
drew the strained implication therefrom that where the
civil liability instituted together with the criminal
liabilities had already passed beyond the judgment of
the then Court of First Instance (now the Regional Trial
Court), the Court of Appeals can continue to exercise
appellate jurisdiction thereover despite the
extinguishment of the component criminal liability of
the deceased. This pronouncement, which has been
followed in the Court's judgments subsequent and
consonant to Torrijos and Sendaydiego, should be set
aside and abandoned as being clearly erroneous and
unjustifiable.
Said Section 21 of Rule 3 is a rule of civil procedure in
ordinary civil actions. There is neither authority nor
justification for its application in criminal procedure to
civil actions instituted together with and as part of
criminal actions. Nor is there any authority in law for the
summary conversion from the latter category of an
ordinary civil action upon the death of the offender. . . .
Moreover, the civil action impliedly instituted in a
criminal proceeding for recovery of civil liability ex
delicto can hardly be categorized as an ordinary
money claim such as that referred to in Sec. 21, Rule
3 enforceable before the estate of the deceased
accused.
Ordinary money claims referred to in Section 21, Rule
3 must be viewed in light of the provisions of Section 5,
Rule 86 involving claims against the estate, which
in Sendaydiego was held liable for Sendaydiego's civil
liability. "What are contemplated in Section 21 of Rule
3, in relation to Section 5 of Rule 86, 14 are contractual
money claims while the claims involved in civil
liability ex delicto may include even the restitution of
personal or real property." 15 Section 5, Rule 86
provides an exclusive enumeration of what claims may
be filed against the estate. These are: funeral
expenses, expenses for the last illness, judgments for
money and claim arising from contracts, expressed or
implied. It is clear that money claims arising from delict
do not form part of this exclusive enumeration. Hence,
there could be no legal basis in (1) treating a civil
action ex delicto as an ordinary contractual money
claim referred to in Section 21, Rule 3 of the Rules of
Court and (2) allowing it to survive by filing a claim
therefor before the estate of the deceased accused.
Rather, it should be extinguished upon extinction of the
criminal action engendered by the death of the
accused pending finality of his conviction.
Accordingly, we rule: if the private offended party, upon
extinction of the civil liability ex delicto desires to
recover damages from the same act or omission
complained of, he must subject to Section 1, Rule
111 16 (1985 Rules on Criminal Procedure as
amended) file a separate civil action, this time
predicated not on the felony previously charged but on
other sources of obligation. The source of obligation
upon which the separate civil action is premised
determines against whom the same shall be enforced.
If the same act or omission complained of also arises
from quasi-delict or may, by provision of law, result in
an injury to person or property (real or personal), the
separate civil action must be filed against the executor
or administrator 17 of the estate of the accused
pursuant to Sec. 1, Rule 87 of the Rules of Court:
Sec. 1. Actions which may and which may not be
brought against executor or administrator. — No action
upon a claim for the recovery of money or debt or
interest thereon shall be commenced against the
executor or administrator; but actions to recover real or
personal property, or an interest therein, from the
estate, or to enforce a lien thereon, and actions to
recover damages for an injury to person or property,
real or personal, may be commenced against him.
This is in consonance with our ruling in
Belamala 18 where we held that, in recovering
damages for injury to persons thru an independent civil
action based on Article 33 of the Civil Code, the same
must be filed against the executor or administrator of
the estate of deceased accused and not against the
estate under Sec. 5, Rule 86 because this rule explicitly
limits the claim to those for funeral expenses,
expenses for the last sickness of the decedent,
judgment for money and claims arising from contract,
express or implied. Contractual money claims, we
stressed, refers only to purely personal
obligations other than those which have their source in
delict or tort.
Conversely, if the same act or omission complained of
also arises from contract, the separate civil action must
be filed against the estate of the accused, pursuant to
Sec. 5, Rule 86 of the Rules of Court.
From this lengthy disquisition, we summarize our ruling
herein:
1. Death of the accused pending appeal of his
conviction extinguishes his criminal liability as well as
153
the civil liability based solely thereon. As opined by
Justice Regalado, in this regard, "the death of the
accused prior to final judgment terminates his criminal
liability and only the civil liability directly arising from
and based solely on the offense committed, i.e., civil
liability ex delicto in senso strictiore."
2. Corollarily, the claim for civil liability survives
notwithstanding the death of accused, if the same may
also be predicated on a source of obligation other than
delict. 19 Article 1157 of the Civil Code enumerates
these other sources of obligation from which the civil
liability may arise as a result of the same act or
omission:
a) Law 20
b) Contracts
c) Quasi-contracts
d) . . .
e) Quasi-delicts
3. Where the civil liability survives, as explained in
Number 2 above, an action for recovery therefor may
be pursued but only by way of filing a separate civil
action and subject to Section 1, Rule 111 of the 1985
Rules on Criminal Procedure as amended. This
separate civil action may be enforced either against the
executor/administrator or the estate of the accused,
depending on the source of obligation upon which the
same is based as explained above.
4. Finally, the private offended party need not fear a
forfeiture of his right to file this separate civil action by
prescription, in cases where during the prosecution of
the criminal action and prior to its extinction, the
private-offended party instituted together therewith the
civil action. In such case, the statute of limitations on
the civil liability is deemed interrupted during the
pendency of the criminal case, conformably with
provisions of Article 1155 21 of the Civil Code, that
should thereby avoid any apprehension on a possible
privation of right by prescription. 22
Applying this set of rules to the case at bench, we hold
that the death of appellant Bayotas extinguished his
criminal liability and the civil liability based solely on the
act complained of, i.e., rape. Consequently, the appeal
is hereby dismissed without qualification.
WHEREFORE, the appeal of the late Rogelio Bayotas
is DISMISSED with costs de oficio.
SO ORDERED.
Narvasa, C.J., Feliciano, Padilla, Bidin, Regalado,
Davide, Jr., Bellosillo, Melo, Quiason, Puno, Vitug,
Kapunan and Mendoza, JJ., concur.
Cruz, J., is on leave.
#Footnotes
1 Nos. L-33252, L-33253 and L-33254, 81 SCRA 120.
2 No. 22211-R, November 4, 1959, 56 O.G. No. 23, p.
4045.
3 supra.
4 L-30612, April 27, 1972, 44 SCRA 523.
5 No. L-28397, June 17, 1976, 71 SCRA 273.
6 No. L-26282, August 27, 1976, 72 SCRA 439.
7 No. L-24098, November 18, 1967, 21 SCRA 970.
8 No. L-40336, October 24, 1975, 67 SCRA 394.
9 Sec. 21. Where claim does not survive. — When the
action is for recovery of money, debt or interest
thereon, and the defendant dies before final judgment
in the Court of First Instance, it shall be dismissed to
be prosecuted in the manner especially provided in
these rules.
10 Supra.
11 People v. Badeo, G.R. No. 72990, November 21,
1991, 204 SCRA 122; Petralba v. Sandiganbayan,
G.R. No. 81337, August 16, 1991, 200 SCRA 644;
Dumlao v. Court of Appeals, No. L-51625, October 5,
1988, 166 SCRA 269; Rufo Mauricio Construction v.
Intermediate Appellate Court, No. L-75357, November
27, 1987, 155 SCRA 712; People v. Salcedo, No. L-
48642, June 22, 1987, 151 SCRA 220; People v.
Pancho, No. L-32507, November 4, 1986, 145 SCRA
323; People v. Navoa, No. L-67966, September 28,
1984, 132 SCRA 410; People v. Asibar,
No. L-37255, October 23, 1982, 117 SCRA 856;
People v. Tirol, No. L-30538, January 31, 1981, 102
SCRA 558; and People v. Llamoso, No. L-24866, July
13, 1979, 91 SCRA 364.
12 Justice Barredo in his concurring opinion observed
that:
. . . this provision contemplates prosecution of the civil
liability arising from a criminal offense without the need
of any criminal proceeding to prove the commission of
the crime as such, that is without having to prove the
criminal liability of the defendant so long as his act
causing damage or prejudice to the offended party is
proven by preponderance of evidence.
13 Supra, p. 134.
14 Sec. 5. Claims which must be filed under the
notice. If not filed, barred; exceptions. — All claims for
money against the decedent, arising from contract,
express or implied, whether the same be due, not due,
or contingent, all claims for funeral expenses and
expenses for the last sickness of the decedent, and
judgment for money against the decedent, must be
filed within the time limited in the notice; otherwise they
are barred forever, except that they may be set forth as
counterclaims in any action that the executor or
administrator may bring against the claimants. Where
an executor or administrator commences an action, or
prosecutes an action already commenced by the
deceased in his lifetime, the debtor may set forth by
answer the claims he has against the decedent,
instead of presenting them independently to the court
as herein provided, and mutual claims may be set off
against each other in such action; and if final judgment
is rendered in favor of the defendant, the amount so
determined shall be considered the true balance
against the estate, as though the claim had been
presented directly before the court in the administration
proceedings. Claims not yet due, or contingent, may be
approved at their present value.
15 As explained by J. Regalado in the deliberation of
this case.
16 Sec. 1. Institute of criminal and civil actions. —
When a criminal action is instituted, the civil action for
154
the recovery of civil liability is impliedly instituted with
the criminal action, unless the offended party waives
the civil action, reserves his right to institute it
separately, or institutes the civil action prior to the
criminal action.
Such civil action includes recovery of indemnity under
the Revised Penal Code, and damages under Article
32, 33, 34 and 2176 of the Civil Code of the Philippines
arising from the same act or omission of the accused.
A waiver of any of the civil actions extinguishes the
others. The institution of, or the reservation of the right
to file, any of said civil actions separately waives the
others.
The reservation of the right to institute the separate civil
actions shall be made before the prosecution starts to
present its evidence and under circumstances
affording the offended party a reasonable opportunity
to make such reservation.
In no case may the offended party recover damages
twice for the same act or omission of the accused.
When the offended party seeks to enforce civil liability
against the accused by way of moral, nominal,
temperate or exemplary damages, the filing fees for
such civil action as provided in these Rules shall
constitute a first lien on the judgment except in an
award for actual damages.
In cases wherein the amount of damages, other than
actual, is alleged in the complaint or information, the
corresponding filing fees shall be paid by the offended
party upon the filing thereof in court for trial.
17 Justice Regalado cited the Court's ruling
in Belamala that since the damages sought, as a result
of the felony committed amounts to injury to person or
property, real or personal, the civil liability to be
recovered must be claimed against the
executor/administrator and not against the estate.
18 Ibid.
19 Justice Vitug who holds a similar view stated: "The
civil liability may still be pursued in a separate civil
action but it must be predicated on a source of
obligation other than delict, except when by statutory
provision an independent civil action is authorized such
as, to exemplify, in the instance enumerated in Article
33 of the Civil Code." Justice Regalado stressed that:
Conversely, such civil liability is not extinguished and
survives the deceased offender where it also arises
simultaneously from or exists as a consequence or by
reason of a contract, as in Torrijos; or from law, as
stated in Torrijos and in the concurring opinion
in Sendaydiego, such as in reference to the Civil Code;
or from a quasi-contract; or is authorized by law to be
pursued in an independent civil action, as in Belamala.
Indeed, without these exceptions, it would be unfair
and inequitable to deprive the victim of his property or
recovery of damages therefor, as would have been the
fate of the second vendee in Torrijos or the provincial
government in Sendaydiego."
20 See Articles 19, 20, 21, 31, 32, 33, 34, 2176 of the
Civil Code; see related provisions of the Rules on
Criminal Procedure, as amended, particularly Sec. 1,
Rule 111.
21 Art. 1155. The prescription of actions is interrupted
when they are filed before the court, when there is a
written extrajudicial demand by the creditors, and when
there is any written acknowledgment of the debt by the
debtor.
22 As explained by J. Vitug in the deliberation of this
case.
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 155223 April 4, 2007
BOBIE ROSE V. FRIAS, represented by her
Attorney-in-fact, MARIE F. FUJITA, Petitioner,
vs.
FLORA SAN DIEGO-SISON, Respondent.
DECISION
AUSTRIA-MARTINEZ, J.:
Before us is a Petition for Review on Certiorari filed by
Bobie Rose V. Frias represented by her Attorney-in-
fact, Marie Regine F. Fujita (petitioner) seeking to
annul the Decision1 dated June 18, 2002 and the
Resolution2 dated September 11, 2002 of the Court of
Appeals (CA) in CA-G.R. CV No. 52839.
Petitioner is the owner of a house and lot located at No.
589 Batangas East, Ayala Alabang, Muntinlupa, Metro
Manila, which she acquired from Island Masters Realty
and Development Corporation (IMRDC) by virtue of a
Deed of Sale dated Nov. 16, 1990.3 The property is
covered by TCT No. 168173 of the Register of Deeds
of Makati in the name of IMRDC.4
On December 7, 1990, petitioner, as the FIRST
PARTY, and Dra. Flora San Diego-Sison (respondent),
as the SECOND PARTY, entered into a Memorandum
of Agreement5 over the property with the following
terms:
NOW, THEREFORE, for and in consideration of the
sum of THREE MILLION PESOS (P3,000,000.00)
receipt of which is hereby acknowledged by the FIRST
PARTY from the SECOND PARTY, the parties have
agreed as follows:
1. That the SECOND PARTY has a period of Six (6)
months from the date of the execution of this contract
within which to notify the FIRST PARTY of her intention
to purchase the aforementioned parcel of land together
within (sic) the improvements thereon at the price of
SIX MILLION FOUR HUNDRED THOUSAND PESOS
(P6,400,000.00). Upon notice to the FIRST PARTY of
the SECOND PARTY’s intention to purchase the
same, the latter has a period of another six months
within which to pay the remaining balance of P3.4
million.
2. That prior to the six months period given to the
SECOND PARTY within which to decide whether or
not to purchase the above-mentioned property, the
FIRST PARTY may still offer the said property to other
persons who may be interested to buy the same
provided that the amount of P3,000,000.00 given to the
FIRST PARTY BY THE SECOND PARTY shall be paid
to the latter including interest based on prevailing
155
compounded bank interest plus the amount of the sale
in excess of P7,000,000.00 should the property be sold
at a price more than P7 million.
3. That in case the FIRST PARTY has no other buyer
within the first six months from the execution of this
contract, no interest shall be charged by the SECOND
PARTY on the P3 million however, in the event that on
the sixth month the SECOND PARTY would decide not
to purchase the aforementioned property, the FIRST
PARTY has a period of another six months within which
to pay the sum of P3 million pesos provided that the
said amount shall earn compounded bank interest for
the last six months only. Under this circumstance, the
amount of P3 million given by the SECOND PARTY
shall be treated as [a] loan and the property shall be
considered as the security for the mortgage which can
be enforced in accordance with law.
x x x x.6
Petitioner received from respondent two million pesos
in cash and one million pesos in a post-dated check
dated February 28, 1990, instead of 1991, which
rendered said check stale.7 Petitioner then gave
respondent TCT No. 168173 in the name of IMRDC
and the Deed of Absolute Sale over the property
between petitioner and IMRDC.
Respondent decided not to purchase the property and
notified petitioner through a letter8 dated March 20,
1991, which petitioner received only on June 11,
1991,9 reminding petitioner of their agreement that the
amount of two million pesos which petitioner received
from respondent should be considered as a loan
payable within six months. Petitioner subsequently
failed to pay respondent the amount of two million
pesos.
On April 1, 1993, respondent filed with the Regional
Trial Court (RTC) of Manila, a complaint10 for sum of
money with preliminary attachment against petitioner.
The case was docketed as Civil Case No. 93-65367
and raffled to Branch 30. Respondent alleged the
foregoing facts and in addition thereto averred that
petitioner tried to deprive her of the security for the loan
by making a false report11 of the loss of her owner’s
copy of TCT No. 168173 to the Tagig Police Station on
June 3, 1991, executing an affidavit of loss and by filing
a petition12 for the issuance of a new owner’s duplicate
copy of said title with the RTC of Makati, Branch 142;
that the petition was granted in an Order13 dated
August 31, 1991; that said Order was subsequently set
aside in an Order dated April 10, 199214where the RTC
Makati granted respondent’s petition for relief from
judgment due to the fact that respondent is in
possession of the owner’s duplicate copy of TCT No.
168173, and ordered the provincial public prosecutor
to conduct an investigation of petitioner for perjury and
false testimony. Respondent prayed for the ex-parte
issuance of a writ of preliminary attachment and
payment of two million pesos with interest at 36% per
annum from December 7, 1991, P100,000.00 moral,
corrective and exemplary damages and P200,000.00
for attorney’s fees.
In an Order dated April 6, 1993, the Executive Judge
of the RTC of Manila issued a writ of preliminary
attachment upon the filing of a bond in the amount of
two million pesos.15
Petitioner filed an Amended Answer16 alleging that the
Memorandum of Agreement was conceived and
arranged by her lawyer, Atty. Carmelita Lozada, who is
also respondent’s lawyer; that she was asked to sign
the agreement without being given the chance to read
the same; that the title to the property and the Deed of
Sale between her and the IMRDC were entrusted to
Atty. Lozada for safekeeping and were never turned
over to respondent as there was no consummated sale
yet; that out of the two million pesos cash paid, Atty.
Lozada took the one million pesos which has not been
returned, thus petitioner had filed a civil case against
her; that she was never informed of respondent’s
decision not to purchase the property within the six
month period fixed in the agreement; that when she
demanded the return of TCT No. 168173 and the Deed
of Sale between her and the IMRDC from Atty. Lozada,
the latter gave her these documents in a brown
envelope on May 5, 1991 which her secretary placed
in her attache case; that the envelope together with her
other personal things were lost when her car was
forcibly opened the following day; that she sought the
help of Atty. Lozada who advised her to secure a police
report, to execute an affidavit of loss and to get the
services of another lawyer to file a petition for the
issuance of an owner’s duplicate copy; that the petition
for the issuance of a new owner’s duplicate copy was
filed on her behalf without her knowledge and neither
did she sign the petition nor testify in court as falsely
claimed for she was abroad; that she was a victim of
the manipulations of Atty. Lozada and respondent as
shown by the filing of criminal charges for perjury and
false testimony against her; that no interest could be
due as there was no valid mortgage over the property
as the principal obligation is vitiated with fraud and
deception. She prayed for the dismissal of the
complaint, counter-claim for damages and attorney’s
fees.
Trial on the merits ensued. On January 31, 1996, the
RTC issued a decision,17 the dispositive portion of
which reads:
WHEREFORE, judgment is hereby RENDERED:
1) Ordering defendant to pay plaintiff the sum of P2
Million plus interest thereon at the rate of thirty two
(32%) per cent per annum beginning December 7,
1991 until fully paid.
2) Ordering defendant to pay plaintiff the sum
of P70,000.00 representing premiums paid by plaintiff
on the attachment bond with legal interest thereon
counted from the date of this decision until fully paid.
3) Ordering defendant to pay plaintiff the sum
of P100,000.00 by way of moral, corrective and
exemplary damages.
4) Ordering defendant to pay plaintiff attorney’s fees
of P100,000.00 plus cost of litigation.18
The RTC found that petitioner was under obligation to
pay respondent the amount of two million pesos with
compounded interest pursuant to their Memorandum of
Agreement; that the fraudulent scheme employed by
petitioner to deprive respondent of her only security to
her loaned money when petitioner executed an
affidavit of loss and instituted a petition for the issuance
of an owner’s duplicate title knowing the same was in
respondent’s possession, entitled respondent to moral
damages; and that petitioner’s bare denial cannot be
accorded credence because her testimony and that of
her witness did not appear to be credible.
The RTC further found that petitioner admitted that she
received from respondent the two million pesos in cash
but the fact that petitioner gave the one million pesos
to Atty. Lozada was without respondent’s knowledge
thus it is not binding on respondent; that respondent
156
had also proven that in 1993, she initially paid the sum
ofP30,000.00 as premium for the issuance of the
attachment bond, P20,000.00 for its renewal in 1994,
andP20,000.00 for the renewal in 1995, thus plaintiff
should be reimbursed considering that she was
compelled to go to court and ask for a writ of
preliminary attachment to protect her rights under the
agreement.
Petitioner filed her appeal with the CA. In a Decision
dated June 18, 2002, the CA affirmed the RTC decision
with modification, the dispositive portion of which
reads:
WHEREFORE, premises considered, the decision
appealed from is MODIFIED in the sense that the rate
of interest is reduced from 32% to 25% per annum,
effective June 7, 1991 until fully paid.19
The CA found that: petitioner gave the one million
pesos to Atty. Lozada partly as her commission and
partly as a loan; respondent did not replace the
mistakenly dated check of one million pesos because
she had decided not to buy the property and petitioner
knew of her decision as early as April 1991; the award
of moral damages was warranted since even granting
petitioner had no hand in the filing of the petition for the
issuance of an owner’s copy, she executed an affidavit
of loss of TCT No. 168173 when she knew all along
that said title was in respondent’s possession;
petitioner’s claim that she thought the title was lost
when the brown envelope given to her by Atty. Lozada
was stolen from her car was hollow; that such deceitful
conduct caused respondent serious anxiety and
emotional distress.
The CA concluded that there was no basis for petitioner
to say that the interest should be charged for six
months only and no more; that a loan always bears
interest otherwise it is not a loan; that interest should
commence on June 7, 199120 with compounded bank
interest prevailing at the time the two million was
considered as a loan which was in June 1991; that the
bank interest rate for loans secured by a real estate
mortgage in 1991 ranged from 25% to 32% per annum
as certified to by Prudential Bank,21 that in fairness to
petitioner, the rate to be charged should be 25% only.
Petitioner’s motion for reconsideration was denied by
the CA in a Resolution dated September 11, 2002.
Hence the instant Petition for Review on Certiorari filed
by petitioner raising the following issues:
(A) WHETHER OR NOT THE COMPOUNDED BANK
INTEREST SHOULD BE LIMITED TO SIX (6)
MONTHS AS CONTAINED IN THE MEMORANDUM
OF AGREEMENT.
(B) WHETHER OR NOT THE RESPONDENT IS
ENTITLED TO MORAL DAMAGES.
(C) WHETHER OR NOT THE GRANT OF
CORRECTIVE AND EXEMPLARY DAMAGES AND
ATTORNEY’S FEES IS PROPER EVEN IF NOT
MENTIONED IN THE TEXT OF THE DECISION.22
Petitioner contends that the interest, whether at 32%
per annum awarded by the trial court or at 25% per
annum as modified by the CA which should run from
June 7, 1991 until fully paid, is contrary to the parties’
Memorandum of Agreement; that the agreement
provides that if respondent would decide not to
purchase the property, petitioner has the period of
another six months to pay the loan with compounded
bank interest for the last six months only; that the CA’s
ruling that a loan always bears interest otherwise it is
not a loan is contrary to Art. 1956 of the New Civil Code
which provides that no interest shall be due unless it
has been expressly stipulated in writing.
We are not persuaded.
While the CA’s conclusion, that a loan always bears
interest otherwise it is not a loan, is flawed since a
simple loan may be gratuitous or with a stipulation to
pay interest,23 we find no error committed by the CA in
awarding a 25% interest per annum on the two-million
peso loan even beyond the second six months
stipulated period.
The Memorandum of Agreement executed between
the petitioner and respondent on December 7, 1990 is
the law between the parties. In resolving an issue
based upon a contract, we must first examine the
contract itself, especially the provisions thereof which
are relevant to the controversy.24 The general rule is
that if the terms of an agreement are clear and leave
no doubt as to the intention of the contracting parties,
the literal meaning of its stipulations shall prevail.25 It is
further required that the various stipulations of a
contract shall be interpreted together, attributing to the
doubtful ones that sense which may result from all of
them taken jointly.26
In this case, the phrase "for the last six months only"
should be taken in the context of the entire agreement.
We agree with and adopt the CA’s interpretation of the
phrase in this wise:
Their agreement speaks of two (2) periods of six
months each. The first six-month period was given to
plaintiff-appellee (respondent) to make up her mind
whether or not to purchase defendant-appellant’s
(petitioner's) property. The second six-month period
was given to defendant-appellant to pay the P2 million
loan in the event that plaintiff-appellee decided not to
buy the subject property in which case interest will be
charged "for the last six months only", referring to the
second six-month period. This means that no interest
will be charged for the first six-month period while
appellee was making up her mind whether to buy the
property, but only for the second period of six months
after appellee had decided not to buy the property. This
is the meaning of the phrase "for the last six months
only". Certainly, there is nothing in their agreement that
suggests that interest will be charged for six months
only even if it takes defendant-appellant an eternity to
pay the loan.27
The agreement that the amount given shall bear
compounded bank interest for the last six months
only, i.e., referring to the second six-month period,
does not mean that interest will no longer be charged
after the second six-month period since such
stipulation was made on the logical and reasonable
expectation that such amount would be paid within the
date stipulated. Considering that petitioner failed to pay
the amount given which under the Memorandum of
Agreement shall be considered as a loan, the monetary
interest for the last six months continued to accrue until
actual payment of the loaned amount.
The payment of regular interest constitutes the price or
cost of the use of money and thus, until the principal
sum due is returned to the creditor, regular interest
continues to accrue since the debtor continues to use
such principal amount.28 It has been held that for a
debtor to continue in possession of the principal of the
loan and to continue to use the same after maturity of
the loan without payment of the monetary interest,
157
would constitute unjust enrichment on the part of the
debtor at the expense of the creditor.29
Petitioner and respondent stipulated that the loaned
amount shall earn compounded bank interests, and per
the certification issued by Prudential Bank, the interest
rate for loans in 1991 ranged from 25% to 32% per
annum. The CA reduced the interest rate to 25%
instead of the 32% awarded by the trial court which
petitioner no longer assailed.1awphi1.nét
In Bautista v. Pilar Development Corp.,30 we upheld
the validity of a 21% per annum interest on
a P142,326.43 loan. In Garcia v. Court of
Appeals,31 we sustained the agreement of the parties
to a 24% per annum interest on an P8,649,250.00
loan. Thus, the interest rate of 25% per annum
awarded by the CA to a P2 million loan is fair and
reasonable.
Petitioner next claims that moral damages were
awarded on the erroneous finding that she used a
fraudulent scheme to deprive respondent of her
security for the loan; that such finding is baseless since
petitioner was acquitted in the case for perjury and
false testimony filed by respondent against her.
We are not persuaded.
Article 31 of the Civil Code provides that when the civil
action is based on an obligation not arising from the act
or omission complained of as a felony, such civil action
may proceed independently of the criminal
proceedings and regardless of the result of the latter.32
While petitioner was acquitted in the false testimony
and perjury cases filed by respondent against her,
those actions are entirely distinct from the collection of
sum of money with damages filed by respondent
against petitioner.
We agree with the findings of the trial court and the CA
that petitioner’s act of trying to deprive respondent of
the security of her loan by executing an affidavit of loss
of the title and instituting a petition for the issuance of
a new owner’s duplicate copy of TCT No. 168173
entitles respondent to moral
damages.1a\^/phi1.net Moral damages may be
awarded in culpa contractual or breach of contract
cases when the defendant acted fraudulently or in bad
faith. Bad faith does not simply connote bad judgment
or negligence; it imports a dishonest purpose or some
moral obliquity and conscious doing of wrong. It
partakes of the nature of fraud.33
The Memorandum of Agreement provides that in the
event that respondent opts not to buy the property, the
money given by respondent to petitioner shall be
treated as a loan and the property shall be considered
as the security for the mortgage. It was testified to by
respondent that after they executed the agreement on
December 7, 1990, petitioner gave her the owner’s
copy of the title to the property, the Deed of Sale
between petitioner and IMRDC, the certificate of
occupancy, and the certificate of the Secretary of the
IMRDC who signed the Deed of Sale.34 However,
notwithstanding that all those documents were in
respondent’s possession, petitioner executed an
affidavit of loss that the owner’s copy of the title and the
Deed of Sale were lost.
Although petitioner testified that her execution of the
affidavit of loss was due to the fact that she was of the
belief that since she had demanded from Atty. Lozada
the return of the title, she thought that the brown
envelope with markings which Atty. Lozada gave her
on May 5, 1991 already contained the title and the
Deed of Sale as those documents were in the same
brown envelope which she gave to Atty. Lozada prior
to the transaction with respondent.35 Such statement
remained a bare statement. It was not proven at all
since Atty. Lozada had not taken the stand to
corroborate her claim. In fact, even petitioner’s own
witness, Benilda Ynfante (Ynfante), was not able to
establish petitioner's claim that the title was returned by
Atty. Lozada in view of Ynfante's testimony that after
the brown envelope was given to petitioner, the latter
passed it on to her and she placed it in petitioner’s
attaché case36 and did not bother to look at the
envelope.37
It is clear therefrom that petitioner’s execution of the
affidavit of loss became the basis of the filing of the
petition with the RTC for the issuance of new owner’s
duplicate copy of TCT No. 168173. Petitioner’s
actuation would have deprived respondent of the
security for her loan were it not for respondent’s timely
filing of a petition for relief whereby the RTC set aside
its previous order granting the issuance of new title.
Thus, the award of moral damages is in order.
The entitlement to moral damages having been
established, the award of exemplary damages is
proper.38Exemplary damages may be imposed upon
petitioner by way of example or correction for the public
good.39 The RTC awarded the amount of P100,000.00
as moral and exemplary damages. While the award of
moral and exemplary damages in an aggregate
amount may not be the usual way of awarding said
damages,40 no error has been committed by CA. There
is no question that respondent is entitled to moral and
exemplary damages.
Petitioner argues that the CA erred in awarding
attorney’s fees because the trial court’s decision did
not explain the findings of facts and law to justify the
award of attorney’s fees as the same was mentioned
only in the dispositive portion of the RTC decision.
We agree.
Article 220841 of the New Civil Code enumerates the
instances where such may be awarded and, in all
cases, it must be reasonable, just and equitable if the
same were to be granted.42 Attorney's fees as part of
damages are not meant to enrich the winning party at
the expense of the losing litigant. They are not awarded
every time a party prevails in a suit because of the
policy that no premium should be placed on the right to
litigate.43 The award of attorney's fees is the exception
rather than the general rule. As such, it is necessary for
the trial court to make findings of facts and law that
would bring the case within the exception and justify
the grant of such award. The matter of attorney's fees
cannot be mentioned only in the dispositive portion of
the decision.44 They must be clearly explained and
justified by the trial court in the body of its decision. On
appeal, the CA is precluded from supplementing the
bases for awarding attorney’s fees when the trial court
failed to discuss in its Decision the reasons for
awarding the same. Consequently, the award of
attorney's fees should be deleted.
WHEREFORE, in view of all the foregoing, the
Decision dated June 18, 2002 and the Resolution
dated September 11, 2002 of the Court of Appeals in
CA-G.R. CV No. 52839 are AFFIRMED with
MODIFICATION that the award of attorney’s fees
is DELETED.
No pronouncement as to costs.
158
SO ORDERED. 3 26
Records, pp. 15-16. Exhibit "C". Civil Code, Article 1374.
4 27
MA. ALICIA AUSTRIA-MARTINEZ Id. at 13-14; Exhibit "B". CA rollo, p. 164-165.
Associate Justice
5 28
Id. at 9-11; Exhibit "A". State Investment House, Inc. v. Court of Appeals,
WE CONCUR: G.R. No. 90676, June 19, 1991, 198 SCRA 390, 398.
6 Id. at 9-10.
CONSUELO YNARES-SANTIAGO 29State Investment House, Inc. v. Court of
7
Associate Justice Respondent did not correct or replace the post-dated Appeals, supra note 28, at 399.
Chairperson check. Records also do not show that petitioner
30
demanded its correction or replacement. 371 Phil. 533, 544 (1999).
ROMEO J. CALLEJO, MINITA V. CHICO- 8 31
SR. NAZARIO Id. at 17, Annex "D". G.R. Nos. L-82282-83, November 24, 1988, 167
Associate Justice Asscociate Justice SCRA 815, 830.
9 Exhibit "D-1", folder of exhibits.
32
ANTONIO EDUARDO B. NACHURA Gorospe v. Nolasco, 114 Phil. 614, 618 (1962).
10 Records, pp. 3-8.
Associate Justice 33Abando v. Lozada, G.R. No. 82564, October 13,
11 Id. at 18, Annex "E". 1989, 178 SCRA 509, 516, citing Board of Liquidators
ATTESTATION
12 v. Kalaw, G.R. No. L-18805, August 14, 1967, 20
Id. at 20-22; Docketed as LRC Case No. M-2282;
I attest that the conclusions in the above Decision had SCRA 987, 1007.
Annex "G".
been reached in consultation before the case was 34
assigned to the writer of the opinion of the Court’s 13 TSN, July 17, 1995, p. 5.
Id. at 23-24; Penned by Judge Salvador P. de
Division. Guzman, Jr.; Annex "H". 35 TSN, August 21, 1995, pp. 7-10.
CONSUELO YNARES-SANTIAGO 14 Id. at 25-27; Annex "I". 36 TSN, October 2, 1995, p. 10.
Associate Justice
15
Chairperson, Third Division Id. at 28. Per Judge Rosalio G. dela Rosa. 37 Id. at 16.
16
CERTIFICATION Id. at 130-141. 38Bert Osmeña & Associates, Inc. v. Court of Appeals,
17 205 Phil. 328, 334 (1983); Kapoe v. Masa, 219 Phil.
Pursuant to Section 13, Article VIII of the Constitution, Id. at 286-292; Branch 30, Penned by Judge Senecio
204, 208 (1985).
and the Division Chairperson’s Attestation, it is hereby O. Ortile.
certified that the conclusions in the above Decision 18
39 Civil Code, Article 2229.
had been reached in consultation before the case was Id. at 292.
assigned to the writer of the opinion of the Court’s 19
40Philippine Airlines, Inc. v. Court of Appeals, G.R.
CA rollo, p. 165.
Division. Nos. 50504-05, August 13, 1990, 188 SCRA 461, 474.
20The date when the second six-month period 41
REYNATO S. PUNO ART. 2208. In the absence of stipulation, attorney's
commences under the Memorandum of Agreement
Chief Justice fees and expenses of litigation, other than judicial
dated December 7, 1990.
costs, cannot be recovered, except:
21 Exhibit "L", folder of exhibits.
(1) When exemplary damages are awarded;
22 Rollo, p. 14.
Footnotes (2) When the defendant's act or omission has
23 Civil Code, Article 1933. compelled the plaintiff to litigate with third persons or to
1 CA rollo, pp. 134-144; Penned by Justice Wenceslao incur expenses to protect his interest;
I. Agnir, Jr. (retired), concurred in by Justices B.A. 24Milwaukee Industries Corporation v. Pampanga III
Adefuin-de la Cruz (retired) and Regalado E. Electric Cooperative, Inc., G.R. No. 152569, May 31, (3) In criminal cases of malicious prosecution against
Maambong. 2004, 430 SCRA 389, 396. the plaintiff;
2 Id. at 164-165. 25 Civil Code, Article 1370.

159
(4) In case of a clearly unfounded civil action or
proceeding against the plaintiff;
(5) Where the defendant acted in gross and evident
bad faith in refusing to satisfy the plaintiff's plainly valid,
just and demandable claim;
(6) In actions for legal support;
(7) In actions for the recovery of wages of household
helpers, laborers and skilled workers;
(8) In actions for indemnity under workmen's
compensation and employer's liability laws;
(9) In a separate civil action to recover civil liability
arising from a crime;
(10) When at least double judicial costs are awarded;
(11) In any other case where the court deems it just
and equitable that attorney's fees and expenses of
litigation should be recovered.
In all cases, the attorney's fees and expenses of
litigation must be reasonable.
42
Citibank, N.A. v. Cabamongan, G.R. No. 146918,
May 2, 2006, 488 SCRA 517, 535-536.
43Id. citing Country Bankers Insurance Corporation v.
Lianga Bay and Community Multi-purpose
Cooperative, Inc. 425 Phil. 511, 525 (2002); Ibaan
Rural Bank, Inc. v. Court of Appeals, 378 Phil. 707, 714
(1999).
44
Samatra v. Vda. de Pariñas, 431 Phil. 255, 267
(2002); Development Bank of the Philippines v. Court
of Appeals, 330 Phil. 801, 810 (1996).
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 110544 October 17, 1995
REYNALDO V. TUANDA, Mayor of the Municipality
of Jimalalud, Negros Oriental, HERMINIGILDO
FABURADA, (former Vice-Mayor), SANTOS A.
VILLANUEVA, Incumbent Member of the
Sangguniang Bayan, MANUEL LIM, NICANOR R.
AGOSTO, ERENIETA K. MENDOZA MAXIMINO A.
VIERNES, HACUBINA V. SERILLO, ILUMINADO D.
ESTRELLANES, and FORMER MEMBERS OF THE
SANGGUNIANG BAYAN OF JIMALALUD,
NEGROS ORIENTAL, petitioners,
vs.
THE HONORABLE SANDIGANBAYAN, (THIRD
DIVISION), BARTOLOME BINAOHAN and DELIA
ESTRELLANES, respondents.
KAPUNAN, J.:
Petitioners institute this special civil action
for certiorari and prohibition under Rule 65 of the
Revised Rules of Court to set aside the resolution of
the Sandiganbayan dated 17 February 1992 and its
orders dated 19 August 1992 and 13 May 1993 in
Criminal Case No. 16936 entitled "People of the
Philippines versus Reynaldo Tuanda, et al." denying
petitioners' motion for suspension of their arraignment.
The present controversy arose from the following
antecedents:
On 9 February 1989, private respondents Delia
Estrellanes and Bartolome Binaohan were designated
as industrial labor sectoral representative and
agricultural labor sectoral representative respectively,
for the Sangguniang Bayan of Jimalalud, Province of
Negros Oriental by then Secretary Luis T. Santos of the
Department of Local Government. Private respondents
Binaohan and Estrellanes took their oath of office on
16 February 1989 and 17 February 1989, respectively.
Subsequently, petitioners filed an undated petition with
the Office of the President for review and recall of said
designations. The latter, however, in a letter dated 20
March 1989, denied the petition and enjoined Mayor
Reynaldo Tuanda to recognize private respondents as
sectoral representatives.
On 4 May 1990, private respondents filed a petition
for mandamus with the Regional Trial Court of Negros
Oriental, Branch 35, docketed as Special Civil Action
No. 9661, for recognition as members of the
Sangguniang Bayan. It was dismissed on 23 July 1991.
Thereafter, on 20 June 1991, petitioners filed an action
with the Regional Trial Court of Dumaguete City to
declare null and void the designations of private
respondents as sectoral representatives, docketed as
Civil Case No. 9955 entitled "Reynaldo Tuanda, et al.
versus Secretary of the Department of Local
Government, et al."
On 21 July 1991, an information was filed before the
Sandiganbayan, docketed as Criminal Case No. 16936
entitled "People of the Philippines versus Reynaldo
Tuanda, et al." charging petitioners thus:
INFORMATION
160
The undersigned Special Prosecution Officer of the
Special Prosecutor, hereby accuses REYNALDO V.
TUANDA, HERMENEGILDO G. FABURADA,
MANUEL LIM, NICANOR P. AGOSTO, ERENIETA K.
MENDOZA, MAXIMO VIERNES, HACUBINA V.
SERILLO, and SANTOS A. VILLANUEVA of Violation
of Section 3(e) of R.A. No. 3019, as amended,
committed as follows:
That during the period from February 1989 to February
1991 and subsequent thereto, in the Municipality of
Jimalalud, Negros Oriental, and within the jurisdiction
of this Honorable Court, accused, all public officers,
Mayor REYNALDO V. TUANDA, Vice-Mayor
HERMENEGILDO G. FABURADA, Sangguniang
Members MANUEL LIM, NICANOR P. AGOSTO,
ERENIETA K. MENDOZA, MAXIMO A. VIERNES,
HACUBINA V. SERILLO, ILUMINADO
ESTRELLANES and SANTOS A. VILLANUEVA while
in the performance of their official functions and taking
advantage of their public positions, with evident bad
faith, manifest partiality, and conspiring and
confederating with each other did, then and there,
wilfully and unlawfully cause undue injury to Sectoral
Members Bartolome M. Binaohan and Delia T.
Estrellanes by refusing to pay despite demand the
amount of NINETY FIVE THOUSAND THREE
HUNDRED FIFTY PESOS (P95,350.00) and ONE
HUNDRED EIGHT THOUSAND NINE HUNDRED
PESOS (P108,900.00) representing respectively
their per diems, salaries and other privileges and
benefits, and such undue injury continuing to the
present to the prejudice and damage of Bartolome
Binaohan and Delia Estrellanes.
CONTRARY TO LAW. 1
On 9 September 1991, petitioners filed a motion with
the Sandiganbayan for suspension of the proceedings
in Criminal Case No. 16936 on the ground that a
prejudicial question exists in Civil Case No. 9955
pending before the Regional Trial Court of Dumaguete
City. 2
On 16 January 1992, the Regional Trial Court rendered
a decision declaring null and void ab initio the
designations issued by the Department of Local
Government to the private respondents as sectoral
representatives for having been done in violation of
Section 146 (2) of B.P. Blg. 337, otherwise known as
the Local Government Code. 3
The trial court expounded thus:
The Supreme Court in the case of Johnny D.
Supangan Jr. v. Luis T. Santos, et al., G.R. No. 84663,
along with 7 companion cases of similar import, (G.R.
Nos. 05012, 87601, 87602, 87792, 87935, 88072, and
90205) all promulgated on August 24, 1990, ruled that:
B.P. Blg. 337 explicitly required that before the
President (or the Secretary of the Department of Local
Government) may appoint members of the local
legislative bodies to represent the Industrial and
Agricultural Labor Sectors, there must be a
determination to be made by the Sanggunian itself that
the said sectors are of sufficient number in the city or
D.
municipality to warrant representation after
consultation with associations and persons belonging
to the sector concerned.
The Supreme Court further ruled —
For that matter, the Implementing Rules and
Regulations of the Local Government Code even
prescribe the time and manner by which such
determination is to be conducted by the Sanggunian.
Consequently, in cases where the Sanggunian
concerned has not yet determined that the Industrial
and Agricultural Labor Sectors in their particular city or
municipality are of sufficient number to warrant
representation, there will absolutely be no basis for the
designation/appointments.
In the process of such inquiry as to the sufficiency in
number of the sector concerned to warrant
representation, the Sanggunian is enjoined by law
(B.P. Blg. 337) to consult with associations and
persons belonging to the sector concerned.
Consultation with the sector concerned is made a pre-
requisite. This is so considering that those who belong
to the said sector are the ones primarily interested in
being represented in the Sanggunian. In the same
aforecited case, the Supreme Court considers such
prior determination by the Sanggunian itself (not by any
other person or body) as a condition sine qua non to a
valid appointment or designation.
Since in the present case, there was total absence of
the required prior determination by the Sangguniang
Bayan of Jimalalud, this Court cannot help but declare
the designations of private defendants as sectoral
representatives null and void.
This verdict is not without precedence. In several
similar cases, the Supreme Court invariably nullified
the designations where the requirements of Sec. 146
(2), B.P. Blg. 337 were not complied with. Just to cite
one case, the Supreme Court ruled:
There is no certification from the Sangguniang Bayan
of Valenzuela that the sectors concerned are of
sufficient number to warrant representation and there
was no consultation whatsoever with the associations
and persons belonging to the Industrial and Agricultural
Labor Sectors. Therefore, the appointment of private
respondents Romeo F. Bularan and Rafael Cortez are
null and void (Romeo Llanado, et al. v. Hon. Luis
Santos, et al., G.R. No. 86394, August 24, 1990). 4
Private respondents appealed the aforestated decision
to the Court of Appeals, docketed as CA-G.R. CV No.
36769, where the same is currently pending resolution.
Meanwhile, on 17 February 1992, respondent
Sandiganbayan issued a resolution denying the motion
for suspension of proceedings filed by petitioners. Said
respondent Sandiganbayan:
Despite the pendency of Civil Case No. 9955 of the
Regional Trial Court of Negros Oriental, it appears,
nevertheless, that the private complainants have been
rendering services on the basis of their respective
appointments as sectoral members of the
Sangguniang Bayan of the Municipality of Jimalalud,
Negros Oriental; and that their said appointments enjoy
the presumption of regularity. Having rendered such
services, the private complainants are entitled to the
salaries attached to their office. Even
assuming arguendo that the said Regional Trial Court
shall later decide that the said appointments of the
private complainants are null and void, still the private
complainants are entitled to their salaries and
compensation for service they have actually rendered,
for the reason that before such judicial declaration of
nullity, the private complainants are considered at
least de facto public officers acting as such on the
basis of apparently valid appointments issued by
161
competent authorities. In other words, regardless of the
decision that may be rendered in Civil Case
No. 9955, the private complainants are entitled to their
withheld salaries for the services they have actually
rendered as sectoral representatives of the said
Sangguniang Bayan. Hence, the decision that may be
rendered by the Regional Trial Court in Civil Case No.
9955 would not be determinative of the innocence or
guilt of the accused.
WHEREFORE, the subject Petition for the Suspension
of Proceedings in Virtue of Prejudicial Question filed by
the accused through counsel, is hereby DENIED for
lack of merit.
SO ORDERED. 5
Petitioners filed a motion for reconsideration of the
aforementioned resolution in view of the decision
promulgated by the trial court nullifying the
appointments of private respondents but it was,
likewise, denied in an order issued by respondent
Sandiganbayan on 19 August 1992 on the justification
that the grounds stated in the said motion were a mere
rehash of petitioners' original motion to hold the case
in abeyance. 6 The dispositive portion of its order reads
as follows:
WHEREFORE, in view of the foregoing, the
arraignment of the accused which was scheduled
today is cancelled. Mayor Reynaldo Tuanda,
Hermenegildo Faburada, Nicanor P. Agosto, Erenieta
K. Mendoza, Hacubina V. Serillo and Iluminado
Estrellanes are, however, hereby ordered to show
cause in writing within ten (10) days from service
hereof why they should not be cited for contempt of
court for their failure to appear in court today for
arraignment.
In case of an adverse resolution on the motion to quash
which is to be filed by the counsel for the defense, set
this case for arraignment, pre-trial and trial on January
4 & 5, 1993, on all dates the trial to start at 8:30 o'clock
in the morning.
SO ORDERED. 7
On 19 February 1993, respondent Sandiganbayan
issued an order holding consideration of all incidents
pending the issuance of an extended resolution. 8
No such resolution, however, was issued and in its
assailed order dated 13 May 1992, respondent
Sandiganbayan set the arraignment of petitioners on
30 June 1993. The dispositive portion of the order
reads:
WHEREFORE, considering the absence of the
accused from the scheduled hearing today which We
deem to be excusable, reset this case for arraignment
on June 30, 1993 and for trial on the merits on June 30
and July 1 and 2, 1993, on all dates the trial to start at
8:30 o'clock in the morning.
Give proper notice to the accused and principal
counsel, Atty. Alfonso Briones. Considering that the
accused come all the way from Himalalud, Negros
Oriental, no postponement will be allowed.
SO ORDERED. 9
Hence, this special civil action for certiorari and
prohibition where petitioners attribute to respondent
Sandiganbayan the following errors:
A. The Respondent Court committed grave abuse of
discretion in denying petitioners' motions for the
suspension of the proceedings in Criminal Case No.
16936 in spite of the pendency of a prejudicial issue
before the Court of Appeals in CA-G.R. CV No. 36769;
B. The Respondent Court acted without or in excess of
jurisdiction in refusing to suspend the proceedings that
would entail a retrial and rehearing by it of the basic
issue involved, i.e., the validity of the appointments of
private respondents and their entitlement to
compensation which is already pending resolution by
the Court of Appeals in C.A. G.R. CV No. 36769; and
C. The Respondent Court committed grave abuse of
discretion and/or acted without or in excess of
jurisdiction in effectively allowing petitioners to be
prosecuted under two alternative theories that private
respondents are de jure and/or de facto officers in
violation of petitioners' right to due process. 10
In sum, the only issue in the case at bench is whether
or not the legality or validity of private respondents'
designation as sectoral representatives which is
pending resolution in CA-G.R. No. 36769 is a
prejudicial question justifying suspension of the
proceedings in the criminal case against petitioners.
A prejudicial question is one that must be decided
before any criminal prosecution may be instituted or
before it may proceed (see Art. 36, Civil Code) because
a decision on that point is vital to the eventual judgment
in the criminal case. Thus, the resolution of the
prejudicial question is a logical antecedent of the
issues involved in said criminal case. 11
A prejudicial question is defined as that which arises in
a case the resolution of which is a logical antecedent
of the issue involved therein, and the cognizance of
which pertains to another tribunal. The prejudicial
question must be determinative of the case before the
court but the jurisdiction to try and resolve the question
must be lodged in another court or tribunal. 12 It is a
question based on a fact distinct and separate from
"the crime but so intimately connected with it that it
determines the guilt or innocence of the accused, and
for it to suspend the criminal action, it must appear not
only that said case involves facts intimately related to
those upon which the criminal prosecution would be
based but also that in the resolution of the issue or
issues raised in the civil case, the guilt or innocence of
the accused would necessarily be determined. It
comes into play generally in a situation where a civil
action and a criminal action are both pending and there
exists in the former an issue which must be
preemptively resolved before the criminal action may
proceed, because howsoever the issue raised in the
civil action is resolved would be determinative juris et
de jure of the guilt or innocence of the accused in the
criminal case." 13
The rationale behind the principle of prejudicial
question is to avoid two conflicting decisions. 14 It has
two essential elements:
(a) the civil action involves an issue similar or intimately
related to the issue raised in the criminal action; and
(b) the resolution of such issue determines whether or
not the criminal action may proceed. 15
Applying the foregoing principles to the case at bench,
we find that the issue in the civil case, CA-G.R. CV No.
36769, constitutes a valid prejudicial question to
warrant suspension of the arraignment and further
proceedings in the criminal case against petitioners.
162
All the elements of a prejudicial question are clearly
and unmistakably present in this case. There is no
doubt that the facts and issues involved in the civil
action (No. 36769) and the criminal case (No. 16936)
are closely related. The filing of the criminal case was
premised on petitioners' alleged partiality and evident
bad faith in not paying private respondents' salaries
and per diems as sectoral representatives, while the
civil action was instituted precisely to resolve whether
or not the designations of private respondents as
sectoral representatives were made in accordance with
law.
More importantly, ,the resolution of the civil case will
certainly determine if there will still be any reason to
proceed with the criminal action.
Petitioners were criminally charged under the Anti-
Graft & Corrupt Practices Act (RA 3019, sec, 3[e]) due
to their refusal, allegedly in bad faith and with manifest
partiality, to pay private respondents' salaries as
sectoral representatives. This refusal, however, was
anchored on petitioners' assertion that said
designations were made in violation of the Local
Government Code (B.P. Blg. 337) and thus, were null
and void. Therefore, should the Court of Appeals
uphold the trial court's decision declaring null and void
private respondents' designations as sectoral
representatives for failure to comply with the provisions
of the Local Government Code (B.P. Blg. 337, sec.
146[2]), the charges against petitioners would no
longer, so to speak, have a leg to stand on. Petitioners
cannot be accused of bad faith and partiality there
being in the first place no obligation on their part to pay
private respondents' claims. Private respondents do
not have any legal right to demand salaries, per
diems and other benefits. In other words, the Court of
Appeals' resolution of the issues raised in the civil
action will ultimately determine whether or not there is
basis to proceed with the criminal case.
Private respondents insist that even if their
designations are nullified, they are entitled to
compensation for actual services rendered. 16 We
disagree. As found by the trial court and as borne out
by the records, from the start, private respondents'
designations as sectoral representatives have been
challenged by petitioners. They began with a petition
filed with the Office of the President copies of which
were received by private respondents on 26 February
1989, barely eight (8) days after they took their oath of 5 Id., at 34-35.
office. 17 Hence, private respondents' claim that they
have actually rendered services as sectoral 6 Id., at 30.
representatives has not been established.
7 Id., at 31.
Finally, we find unmeritorious respondent
8 Id., at 82.
Sandiganbayan's thesis that even in the event that
private respondents' designations are finally declared 9 Id., at 29. 10 Id., at 13-14.
invalid, they may still be considered de facto public
officers entitled to compensation for services actually 11 Edgardo C. Paras, Rules of Court Annotated Vol.
rendered. Three, 1990, citing People v. Aragon, L-5930, 17 Feb.
1954.
The conditions and elements of de facto officership are
the following: 12 Yap v. Paras, 205 SCRA 625 (1994); Quiambao v.
Osorio, 158 SCRA 674 (1988); Donato v. Luna, 160
1) There must be a de jure office; SCRA 441 (1988); Ras v. Rasul, 100 SCRA 125
(1980).
2) There must be color of right or general acquiescence
by the public; and 13 Librodo v. Coscolluela, Jr., 116 SCRA 303
(1982): see also Apa, et al. v. Fernandez, et al., G.R.
3) There must be actual physical possession of the
office in good faith. 18 No. 112381, March 20, 1995.
14 Developments In The Law On Prejudicial
One can qualify as a de facto officer only if all the
Questions, 44 SCRA 208 (1972).
aforestated elements are present. There can be no de
factoofficer where there is no de jure office, although 15 Sec. 5, Rule III of Revised Rules of Court; Yap v.
there may be a de facto officer in a de jure office. 19 Paras, supra, Umali v. IAC, 186 SCRA 680 (1990).
WHEREFORE, the resolution dated 17 February 1992 16 Rollo, p. 92.
and orders dated 19 August 1992 and 13 May 1993 of
respondent Sandiganbayan in Criminal Case No. 17 Id., at 52-53.
16936 are hereby SET ASIDE. Respondent
Sandiganbayan is enjoined from proceeding with the 18 Hector S. De Leon and Hector M. De Leon, Jr., Law
arraignment and trial of petitioners in Criminal Case on Public Officers and Election Law, 1990 ed., pp. 87-
No. 16936 pending final resolution of CA-G.R. CV No. 88.
36769.
19 Government of the Philippine Islands v. Springer,
SO ORDERED. 50 Phil. 259.
Padilla, Davide, Jr. and Bellosillo, JJ., concur.
Hermosisima, Jr., J., took no part.
Footnotes
1 Rollo, pp. 36-37.
2 Id., at 38-50.
3 Id., at 51-60.
4 Id., at 59-61.
163

Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 137567 June 20, 2000
MEYNARDO L. BELTRAN, petitioner,
vs.
PEOPLE OF THE PHILIPPINES, and HON. JUDGE
FLORENTINO TUAZON, JR., being the Judge of
the RTC, Brach 139, Makati City, respondents.
BUENA, J.:
This petition for review, filed under Rule 45 of the 1997
Rules of Civil Procedure, seeks to review and set aside
the Order dated January 28, 1999 issued by Judge
Florentino A. Tuazon, Jr. of the Regional Trial Court of
Makati City, Branch 139 in Special Civil Case No. 98-
3056, entitled "Meynardo Beltran vs. People of the
Philippines and Hon. Judge Alden Cervantes of the
Metropolitan Trial Court of Makati City, Branch 61." The
said Order denied petitioner's prayer for the issuance
of a writ of preliminary injunction to enjoin Judge
Cervantes from proceeding with the trial of Criminal
Case No. 236176, a concubinage case against
petitioner on the ground that the pending petition for
declaration of nullity of marriage filed by petitioner
against his wife constitutes a prejudicial question.
The antecedent facts of the case are undisputed:
Petitioner Meynardo Beltran and wife Charmaine E.
Felix were married on June 16, 1973 at the Immaculate
Concepcion Parish Church in Cubao, Quezon City.1
On February 7, 1997, after twenty-four years of
marriage and four children,2 petitioner filed a petition
for nullity of marriage on the ground of psychological
incapacity under Article 36 of the Family Code before
Branch 87 of the Regional Trial Court of Quezon City.
The case was docketed as Civil Case No. Q-97-
30192.3
In her Answer to the said petition, petitioner's wife
Charmaine Felix alleged that it was petitioner who
abandoned the conjugal home and lived with a certain
woman named Milagros Salting.4 Charmaine
subsequently filed a criminal complaint for
concubinage5 under Article 334 of the Revised Penal
Code against petitioner and his paramour before the
City Prosecutor's Office of Makati who, in a Resolution
dated September 16, 1997, found probable cause and
ordered the filing of an Information6 against them. The
case, docketed as Criminal Case No. 236176, was filed
before the Metropolitan Trial Court of Makati City,
Branch 61.1awphi1
On March 20, 1998, petitioner, in order to forestall the
issuance of a warrant for his arrest, filed a Motion to
Defer Proceedings Including the Issuance of the
Warrant of Arrest in the criminal case. Petitioner
argued that the pendency of the civil case for
declaration of nullity of his marriage posed a prejudicial
question to the determination of the criminal case.
Judge Alden Vasquez Cervantes denied the foregoing
motion in the Order7dated August 31, 1998. Petitioner's
motion for reconsideration of the said Order of denial
was likewise denied in an Order dated December 9,
1998.
In view of the denial of his motion to defer the
proceedings in the concubinage case, petitioner went
to the Regional Trial Court of Makati City, Branch 139
on certiorari, questioning the Orders dated August 31,
1998 and December 9, 1998 issued by Judge
Cervantes and praying for the issuance of a writ of
preliminary injunction.8 In an Order9 dated January 28,
1999, the Regional Trial Court of Makati denied the
petition for certiorari. Said Court subsequently issued
164
another Order 10 dated February 23, 1999, denying his
motion for reconsideration of the dismissal of his
petition.
Undaunted, petitioner filed the instant petition for
review.
Petitioner contends that the pendency of the petition for
declaration of nullity of his marriage based on
psychological incapacity under Article 36 of the Family
Code is a prejudicial question that should merit the
suspension of the criminal case for concubinage filed
against him by his wife.
Petitioner also contends that there is a possibility that
two conflicting decisions might result from the civil case
for annulment of marriage and the criminal case for
concubinage. In the civil case, the trial court might
declare the marriage as valid by dismissing petitioner's
complaint but in the criminal case, the trial court might
acquit petitioner because the evidence shows that his
marriage is void on ground of psychological incapacity.
Petitioner submits that the possible conflict of the
courts' ruling regarding petitioner's marriage can be
avoided, if the criminal case will be suspended, until
the court rules on the validity of marriage; that if
petitioner's marriage is declared void by reason of
psychological incapacity then by reason of the
arguments submitted in the subject petition, his
marriage has never existed; and that, accordingly,
petitioner could not be convicted in the criminal case
because he was never before a married man.
Petitioner's contentions are untenable.
The rationale behind the principle of prejudicial
question is to avoid two conflicting decisions. It has two
essential elements: (a) the civil action involves an issue
similar or intimately related to the issue raised in the
criminal action; and (b) the resolution of such issue
determines whether or not the criminal action may
proceed. 11
The pendency of the case for declaration of nullity of
petitioner's marriage is not a prejudicial question to the
concubinage case. For a civil case to be considered
prejudicial to a criminal action as to cause the
suspension of the latter pending the final determination
of the civil case, it must appear not only that the said
civil case involves the same facts upon which the
criminal prosecution would be based, but also that in
the resolution of the issue or issues raised in the
aforesaid civil action, the guilt or innocence of the
accused would necessarily be determined.
Art. 40 of the Family Code provides:
The absolute nullity of a previous marriage may be
invoked for purposes of remarriage on the basis solely
of a final judgment declaring such previous marriage
void.
In Domingo vs. Court of Appeals, 12 this Court ruled
that the import of said provision is that for purposes of
remarriage, the only legally acceptable basis for
declaring a previous marriage an absolute nullity is a
final judgment declaring such previous marriage void,
whereas, for purposes of other than remarriage, other
evidence is acceptable. The pertinent portions of said
Decision read:
. . . Undoubtedly, one can conceive of other instances
where a party might well invoke the absolute nullity of
a previous marriage for purposes other than
remarriage, such as in case of an action for liquidation,
partition, distribution and separation of property
between the erstwhile spouses, as well as an action for
the custody and support of their common children and
the delivery of the latters' presumptive legitimes. In
such cases, evidence needs must be adduced,
testimonial or documentary, to prove the existence of
grounds rendering such a previous marriage an
absolute nullity. These needs not be limited solely to
an earlier final judgment of a court declaring such
previous marriage void.
So that in a case for concubinage, the accused, like the
herein petitioner need not present a final judgment
declaring his marriage void for he can adduce evidence
in the criminal case of the nullity of his marriage other
than proof of a final judgment declaring his marriage
void.
With regard to petitioner's argument that he could be
acquitted of the charge of concubinage should his
marriage be declared null and void, suffice it to state
that even a subsequent pronouncement that his
marriage is void from the beginning is not a defense.
Analogous to this case is that of Landicho
vs. Relova 1 cited in Donato vs. Luna 14 where this
Court held that:
. . . Assuming that the first marriage was null and void
on the ground alleged by petitioner, that fact would not
be material to the outcome of the criminal case. Parties
to the marriage should not be permitted to judge for
themselves its nullity, for the same must be submitted
to the judgment of the competent courts and only when
the nullity of the marriage is so declared can it be held
as void, and so long as there is no such declaration the
presumption is that the marriage exists. Therefore, he
who contracts a second marriage before the judicial
declaration of nullity of the first marriage assumes the
risk of being prosecuted for bigamy.
Thus, in the case at bar it must also be held that parties
to the marriage should not be permitted to judge for
themselves its nullity, for the same must be submitted
to the judgment of the competent courts and only when
the nullity of the marriage is so declared can it be held
as void, and so long as there is no such declaration the
presumption is that the marriage exists for all intents
and purposes. Therefore, he who cohabits with a
woman not his wife before the judicial declaration of
nullity of the marriage assumes the risk of being
prosecuted for concubinage. The lower court therefore,
has not erred in affirming the Orders of the judge of the
Metropolitan Trial Court ruling that pendency of a civil
action for nullity of marriage does not pose a prejudicial
question in a criminal case for concubinage.
WHEREFORE, for lack of merit, the instant petition is
DISMISSED.
SO ORDERED.
Bellosillo, Mendoza, Quisumbing and De Leon, JJ.,
concur.
Footnotes
1Amended Complaint, Annex "E," Petition, Rollo, p.
61.
2 Annex "E," Rollo, p. 61.
165
3 Petition, p. 3; Rollo, p. 14.
4 Petition, p. 3; Rollo, p. 14.
5 Guzman. PASI was established by a consortium of
Petition, Annex "F," Rollo, pp. 69-70.
6 Petition, Annex "H," Rollo, pp. 80-81.
7 Jesus Garcia, concerning the planned launch of a
Petition, Annex "I," Rollo, pp. 82-83.
8 Petition, Annex "J," Rollo, pp. 84-100.
9
Petition, Annex "A," Rollo, pp. 33-39.
10 Petition, Annex "C," Rollo, pp. 52-54.
11 Carlos vs. Court of Appeals, 268 SCRA 25 [1997].
12 226 SCRA 572 [1993].
13
22 SCRA 731 [1968].
Republic of the Philippines
14 160 SCRA 441 [1988]. SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 142362 May 3, 2006
PHILIPPINE AGILA SATELLITE INC. and
MICHAELC. U. DE GUZMAN, Complainants,
vs.
JOSEFINA TRINIDAD-LICHAUCO Undersecretary
for Communications, Department of
Transportation and Communication
(DOTC), Respondents.
DECISION
TINGA, J.:
This Petition for Review on Certiorari seeks the
reversal of the Decision1 dated 21 February 2000 of the
Court of Appeals in C.A. G.R. No. SP 49422. The
assailed Decision authorized the dismissal of a civil
complaint against respondent Josefina Trinidad-
Lichauco (Lichauco), former Undersecretary for
Communications of the Department of Transportation
and Communication (DOTC), on the premise that the
complaint constituted a suit against the State.
A brief rundown of the relevant facts is in order.
Petitioner Philippine Agila Satellite Inc. (PASI) is a duly
organized corporation, whose President and Chief
Executive Officer is co-petitioner Michael C.U. De
private telecommunications carriers2 which in 1994
had entered into a Memorandum of Understanding
(MOU) with the DOTC, through its then Secretary
Philippine-owned satellite into outer space. Under the
MOU, the launch of the satellite was to be an endeavor
of the private sector, and the satellite itself to be owned
by the Filipino-owned consortium (subsequently
organized as PASI).3 The consortium was to grant the
Philippine government one (1) transponder free of
charge for the government's exclusive use for non-
commercial purpose, as well as the right of first refusal
to another one (1) transponder in the Philippine
satellite, if available.4 The Philippine government,
through the DOTC, was tasked under the MOU to
secure from the International Telecommunication
Union the required orbital slot(s) and frequency
assignment(s) for the Philippine satellite.
PASI itself was organized by the consortium in 1996.
The government, together with PASI, coordinated
through the International Telecommunication Union
two (2) orbital slots, designated as 161º East Longitude
and 153º East Longitude, for Philippine satellites. On
28 June 1996, PASI wrote then DOTC Secretary
Amado S. Lagdameo, Jr., seeking for official Philippine
government confirmation on the assignment of the two
aforementioned Philippine orbital slots to PASI for its
satellites, which PASI had designated as the Agila
satellites.5 Secretary Lagdameo, Jr. replied in a letter
dated 3 July 1996, confirming "the Philippine
Government's assignment of Philippine orbital slots
161E and 153E to [PASI] for its [Agila] satellites."6
PASI avers that after having secured the confirmation
from the Philippine government, it proceeded with
preparations for the launching, operation and
management of its satellites, including the availment of
loans, the increase in its capital, negotiation with
business partners, and an initial payment of US$3.5
Million to the French satellite manufacturer. However,
respondent Lichauco, then DOTC Undersecretary for
Communications, allegedly "embarked on a crusade to
malign the name of [Michael de Guzman] and
sabotage the business of PASI." Lichauco's purported
166
efforts against PASI culminated allegedly in her
offering orbital slot 153º East Longitude
for bidding to other parties sometime in December
1997, despite the prior assignment to PASI of the said
slot.7 It was later claimed by PASI that Lichauco
subsequently awarded the orbital slot to an entity
whose indentity was unknown to PASI.8
Aggrieved by Lichauco's actions, PASI and De
Guzman instituted on 23 January 1998 a civil complaint
against Lichauco, by then the Acting Secretary of the
DOTC, and the "Unknown Awardee" who was to be the
recipient of orbital slot 153º East Longitude. The
complaint, alleging three (3) causes of action, was for
injunction, declaration of nullity of award, and
damages. The first cause of action, for injunction,
sought to establish that the award of orbital slot 153º
East Longitude should be enjoined since the DOTC
had previously assigned the same orbital slot to PASI.
The second cause of action, for declaration of nullity of
award, averred that the award to the unknown bidder
is null and void, as it was rendered by Lichauco beyond
her authority.9
The third cause of action, for damages, imputed
several acts to Lichauco as part of her alleged
"crusade" to malign the name of plaintiff [D]e Guzman
and sabotage the business of [PASI]:
12. xxx
(a) On 4 December 1996, in a meeting with the
members of the Board of Directors of plaintiff
corporation, defendant Lichauco then uttered
disparaging and defamatory comments against plaintiff
de Guzman. These defamatory remarks triggered
efforts from within the plaintiff corporation aimed at
ousting plaintiff de Guzman from his position.
(b) Defendant Lichauco, then an undersecretary of
DOTC, wrote Mr. Jesli Lapuz on 5 December 1996
(barely two days after plaintiff de Guzman wrote him)
to deny that the DOTC has assigned the two (2)
Philippine orbital slots to plaintiff corporation.
Defendant Lichauco falsely asserted that only orbital
slot 161 E was assigned to plaintiff, orbital slot 153 E
was not.
In the same letter, defendant Lichauco branded as declared null and void. Finally, the complaint alleged a
FALSE plaintiff de Guzman's claim that "Agila" is a cause of action for damages against Lichauco, cast in
registered corporate name of plaintiff corporation. the following manner:
A copy of the letter is attached as Annex E. xxxx
(c) Not contented, defendant Lichauco, again for 21. Defendant Lichauco attacked the good name and
reasons known only to her, and with malice reputation of plaintiffs.
aforethought, made defamatory remarks against
plaintiffs during a telecommunications forum held in 22. She willfully caused damage to plaintiffs by
Makati City sometime in October 1997 in the presence orchestrating the above-described acts which are
of public officials and business executives. contrary to law; morals and basic norms of good faith.
(d) Defendant Lichauco did not spare plaintiff 23. She interefered with and violated plaintiff
corporation from her unprovoked defamation. corporation's contract with DOTC by offering and
Defendant Lichauco arrogantly said that she had asked awarding orbital slot 153 E to defendant Unknown
President Fidel V. Ramos to sue plaintiff Michael de Awardee.
Guzman. With the same degree of arrogance she
24. Because of defendant Lichauco's reprehensible
threatened plaintiff corporation not to use the name
acts, plaintiffs suffered actual damages of at least P10
"Agila", otherwise she would fight plaintiff corporation
million each, for all of which defendant Lichauco should
and would make sure that the name of Agila would
be held liable to pay.
never be given back to plaintiff corporation.
25. By reason of defendant Lichauco's illegal and
(e) To top it all, defendant Lichauco without basis and
malicious acts, plaintiff corporation's business name
with evident bad faith, said that plaintiff corporation will
and goodwill was tarnished, for which plaintiff
never pay its contractors.
corporation should be indemnified by way of moral
damages in the amount of at least P10 million.
(f) In December 1997, defendant Lichauco delivered
the coup de' grace. Again, acting unilaterally, without
26. For the same reasons, plaintiff de Guzman suffered
prior notice to plaintiff corporation and in gross violation
and continue to suffer extreme mental anguish, serious
of DOTC's earlier assignment to plaintiff corporation of
anxiety, wounded feelings, moral shock and
orbital slot 153 E, defendant Lichauco offered said slot
besmirched reputation, for all of which plaintiff de
to interested applicants. A copy of the notice of offer is
Guzman should be indemnified in the amount of at
attached as Annex F.
least P10 million.
13. Plaintiffs learned of defendant Lichauco's acts after
27. Defendant Lichauco should also be sanctioned, as
orbital slot 153 E was offered for bidding. To plaintiff
a deterrent for public good, to pay each plaintiff
coproration's knowledge, the orbital slot was eventually
exemplary damages in the amount of at least P5
awarded to defendant Unknown Awardee.
million.
x x x x10
28. In order to protect and enforce their rights, plaintiffs
were compelled to institute this suit, engage the
The complaint alleged that since Lichauco's act of
services of counsel and incur litigation expenses, for all
offering and awarding orbital slot 153º East Longitude
of which plaintiffs should be indemnified in the amount
was patently illegal and violative of DOTC's prior
of at least P500 Thousand each.11
commitment to PASI, Lichauco should be enjoined
from performing any acts and entering into or executing
xxxx
any agreement or arrangement of whatever nature in
connection with the said orbital slot. The complaint also In sum, petitioners sought the following reliefs for the
averred that the purported award of the orbital slot to three (3) causes of action:
the "Unknown Awardee was illegal, and thus should be
167
xxxx
3. After trial of the issues, render judgment as follows:
[a] On the first cause of action, making permanent the
writ of preliminary injunction;
[b] On the second cause of action, declaring the offer
and award of orbital slot 153 E to defendant Unknown
Awardee null and void.
[c] On the third cause of action, directing defendant
Lichauco to pay the following sums:
i. P10 million each to plaintiffs as actual damages;
ii. P10 million to plaintiff corporation as moral damages;
iii. P10 million to plaintiff de Guzman as moral
damages;
iv. P5 million each to plaintiffs as exemplary damages;
v. P500 Thousand each to plaintiffs as attorney's fees
and litigation expenses.
x x x x12
The complaint was filed before the Regional Trial Court
(RTC) of Mandaluyong City, and subsequently raffled
to Branch 214. On 2 February 1998, the RTC issued a
temporary restraining order against Lichauco, who
received the summons together with the complaint on
28 January 1998. Lichauco failed to file an answer
within the reglementary period, but eight (8) days after
the lapse thereof, she filed a Manifestation and Motion
asking for a new five (5)-day period, or until 25
February 1998, to file a responsive pleading to the
complaint. However, she filed instead a Motion to
Admit with attached Motion to Dismiss on 27 February
1998. She rooted her prayer for the dismissal of the
complaint primarily on the grounds that the suit is a suit
against the State which may not be sued without its
consent; that the complaint stated no cause of action;
and that the petitioners had failed to exhaust
administrative remedies by failing to seek recourse
with the Office of the President.
In an order13 dated 14 August 1998, the RTC denied
the motion to dismiss. It characterized the defense of
state immunity as "at very least a contentious issue
which can not be resolved by mere allegations in the
pleadings but which can be best threshed out in a
litig[i]ous forum where parties are accorded enormous
(sic) opportunity to argue for the ascertainment of
whether the act complained of are indeed within the
parameters and prerogatives of the authority
exercising the same."14 The RTC also noted that the
allegations in the complaint regarding the ultimate facts
sufficiently presented an ultra vires act of Lichauco,
and that she was being sued in her personal capacity.
As to the argument pertaining to the non-exhaustion of
administrative remedies, the RTC noted that the
principle is not an inflexible rule, and may be dispensed
with when its application would cause great and
irreparable damage or when it would not constitute a
plain, speedy and adequate remedy.15
Lichauco assailed the RTC order through a Petition for
Certiorari under Rule 65 before the Court of Appeals,
which subsequently nullified the RTC order in the
Decision now assailed before us. The Court of Appeals
sustained the contention that the complaint is a suit
against the State with the following ratiocination:
The suit is to the mind of this court a suit against the
state.1avvphil.net
The notice of offer signed by herein petitioner allegedly
tainted with bad faith was done in the exercise of and
in pursuance of an official duty. Her duties are as
follows:
SEC. 10. Powers and Duties of the
Undersecretary. The Undersecretary shall:
(1) Advise and assist the Secretary in the formulation
and implementation of department objectives and
policies;
(2) Oversee all the operational activities of the
department for which he shall be responsible to the
Secretary;
(3) Coordinate the programs and projects of the
department and be responsible for its economical,
efficient and effective administration:
xxxxxxxxx
It is apparent from the above enumeration that the
petitioner is directly under and answerable to the
DOTC Secretary. We can therefore conclude that her
official acts such as the said "notice of offer" was with
the blessing and prior approval of the DOTC Secretary
himself.
Being an official act, it is also protected by the
presumption that the same was performed in good faith
and in the regular performance of official duty.
"Acts in Line of Duty or under Color of Authority. -
As a rule, a public officer, whether judicial, quasi-
judicial, or executive, is not personally liable to one
injured in consequence of an act performed within the
scope of his official authority, and in the line of his
official duty. In order that acts may be done within the
scope of official authority, it is not necessary that they
be prescribed by statute, or even that they be
specifically directed or requested by a superior officer,
but it is sufficient if they are done by an officer in
relation to matters committed by law to his control or
supervision, or that they have more or less connection
with such matters, or that they are governed by a lawful
requirement of the department under whose authority
the officer is acting. Under this principle, state building
commissioners who, in obedience to a stature,
discharge one who has been employed to construct a
state building, take possession of the work, and place
it in the hands of another contractor, are not liable to
the former contractor in damages, since in so doing
they are merely acting in the line of their duty. An officer
is not personally responsible for the necessary and
unavoidable destruction of goods stored in buildings,
when such buildings were destroyed by him in the
lawful performance of a public duty imposed on him by
a valid and constitutional statute."
xxxxxxxxx
Error or Mistake in Exercise of Authority. - Where
an officer is invested with discretion and is empowered
to exercise his judgment in matters brought before him
he is sometimes called a quasi-judicial officer, and
when so acting he is usually given immunity from
liability to persons who may be injured as the result of
an erroneous or mistaken decision, however,
erroneous judgment may be, provided the acts
complained of are done within the scope of the officer's
authority, and without willfulness, malice, or
corruption." (43 Am. Jur., pp. 85-86).
In Sanders vs. Veridiano[16], the Supreme Court held:
168
"Given the official character of the above-described
letters, we have to conclude that the petitioners were,
legally speaking, being sued as officers of the United
States government. As they have acted on behalf of
that government, and within the scope of their
authority, it is that government and not the petitioners
personally, that is responsible for their acts. Assuming
that the trial can proceed and it is proved that the
claimants have a right to the payment of damages,
such award will have to be satisfied not by the
petitioners in their personal capacities but by the
United States government as their principal. This will
require that government, viz.: the appropriation of the
necessary amount to cover the damages awarded,
thus making the action a suit against that government
without its consent.
There should be no question by now that such
complaint cannot prosper unless the government
sought to be held ultimately liable has given its consent
to be sued. So we have ruled not only in Baer but in
many other decisions where we upheld the doctrine of
state immunity as applicable not only to our own
government but also to foreign States sought to be
subjected to the jurisdiction of our courts.
xxxxxxxxx
The Court finds that, even under the law of public
officers, the acts of the petitioners are protected by the
presumption of good faith, which has not been
overturned by the private respondents. Even mistakes
concededly committed by such public officers are not
actionable as long as it is not shown that they were
motivated by malice or gross negligence amounting to
bad faith. This too is well-settled."17
Preliminarily, we discuss the procedural grounds cited
by petitioners which they assert are sufficient to have
caused the dismissal of Lichauco's petition before the
Court of Appeals. Petitioners claim that contrary to
Section 1, Rule 65 of the 1997 Rules of Civil
Procedure, Lichauco failed to attach all pleadings and
documents relevant to her petition, and that those that
were attached were merely "duplicate original copies."
Lichauco counters that for the viability of her petition for
certiorari, all that she needed to attach were her motion
to dismiss, the RTC orders acting on such motion, her
motion for reconsideration of the denial of her motion
to dismiss, and petitioners' opposition to said motion
for reconsideration. She claims that only these motions
and submission were relevant to the resolution of her
petition.18
In her comment, Lichaucho claims that she did not
have to attach the complaint to the copy of the petition
she sent to the petitioners herein, since the latter
obviously retained the original copy of the complaint
they filed.19However, her petition before the appellate
court does not indicate that the same complaint was
included as an attachment, and indeed, there is a
curious absence of any averment on Lichuaco's part
that she indeed attached the said complaint to her
petition.20 Certainly, in a petition for certiorari assailing
the denial of a motion to dismiss a complaint, the very
complaint itself is a document relevant and pertinent to
the special civil action. It should be remembered that
unlike in an ordinary appeal that is given due
course,21 the case record is not automatically elevated
to the court exercising jurisdiction over a special civil
action for certiorari; hence there is an even more
impelling need to attach all pleadings and documents
to the special civil action, as mandated under Section
1, Rule 65 of the 1997 Rules of Civil Procedure. After
all, how could the court a quo properly ascertain
whether or not the motion to dismiss itself should have
been granted if it did not have a copy of the complaint
sought to be dismissed itself.
Nonetheless, the requirement to attach such relevant
pleadings under Section 1, Rule 65 is read in relation
to Section 3, Rule 46, which states that the failure of
the petitioner to comply with any of the documentary
requirements, such as the attachment of such relevant
pleadings, "shall be sufficient ground for the dismissal
of the petition." The procedural rule accords sufficient
discretion to the court hearing the special civil action
whether or not to dismiss the petition outright for failure
to comply with said requirement. If the court does
dismiss the petition on that ground, the dismissal would
be justifiable under Section 3, Rule 46, and generally
such action of the court cannot be assailed as
constituting either grave abuse of discretion or
reversible error of law. If the court, on the other hand,
takes cognizance of the petition despite such lapses,
the phrasing of Section 3, Rule 46 sufficiently justifies
such adjudicative recourse. Indeed, the ultimate logic
behind rules of procedure being the promotion of the
objective of securing a just, speedy and inexpensive
disposition of every action and proceeding, 22 the
higher interests of justice may at times sufficiently
warrant the allowance of the petition for certiorari
despite such lapses, especially if they are nonetheless
correctible through subsequent submissions.
In any event, the Court is willing to overlook Lichauco's
failure to attach the complaint in her petition for
certiorari before the Court of Appeals, an oversight
sadly ignored by the appellate court. There are weighty
issues at hand relating to the doctrine of state immunity
from suit and the requisites of a motion to dismiss.
There is a connective issue between these two aspects
in that if the State is sued without its consent, the
corresponding suit must be dismissed. At times, it
would be teasingly obvious, even from the moment of
the filing of the complaint, that the suit is one against
the State. A cursory examination of the caption of the
complaint can sometimes betray such proscribed
intent, as when the suit is directly initiated against the
Republic of the Philippines, any foreign government, or
an unincorporated government agency as the named
respondents. In such cases, obviously there is need for
immediate caution, although if it is somehow
established that those respondents had given their
consent to be sued, the suit may nonetheless prosper.
The present action was denominated against Lichauco
and the unknown awardee, Lichauco was identified in
the complaint as "acting Secretary of the
[DOTC]."23 The hornbook rule is that a suit for acts
done in the performance of official functions against an
officer of the government by a private citizen which
would result in a charge against or financial liability to
the government must be regarded as a suit against the
State itself, although it has not been formally
impleaded.24 However, government immunity from suit
will not shield the public official being sued if the
government no longer has an interest to protect in the
outcome of a suit; or if the liability of the officer is
personal because it arises from a tortious act in the
performance of his/her duties.
Petitioner insists that Lichauco is being sued for her
acts committed in excess of her authority, ultra vires
innature, and tortious in character. The Court of
Appeals responded that such acts fell within Lichauco's
official duties as DOTC Undersecretary, thus enjoying
the presumption that they were performed in good faith
and in the regular performance of official duty. This
169
rationale is pure sophistry and must be rejected
outright.
We do not doubt the existence of the presumptions of
"good faith" or "regular performance of official duty", yet
these presumptions are disputable25 and may be
contradicted and overcome by other evidence.26 Many
civil actions are oriented towards overcoming any
number of these presumptions, and a cause of action
can certainly be geared towards such effect. The very
purpose of trial is to allow a party to present evidence
overcome the disputable presumptions involved.
Otherwise, if trial is deemed irrelevant or unnecessary,
owing to the perceived indisputability of the
presumptions, the judicial exercise would be relegated
to a mere ascertainment of what presumptions apply in
a given case, nothing more. Consequently, the entire
Rules of Court is rendered as excess verbiage, save
perhaps for the provisions laying down the legal
presumptions.
If this reasoning of the Court of Appeals were ever
adopted as a jurisprudential rule, no public officer could
ever be sued for acts executed beyond their official
functions or authority, or for tortious conduct or
behavior, since such acts would "enjoy the
presumption of good faith and in the regular
performance of official duty". Indeed, few civil actions
of any nature would ever reach the trial stage, if a case
can be adjudicated by a mere determination from the
complaint or answer as to which legal presumptions
are applicable. For example, the presumption that a
person is innocent of a wrong is a disputable
presumption on the same level as that of the regular
performance of official duty.27 A civil complaint for
damages necessarily alleges that the defendant
committed a wrongful act or omission that would serve
as basis for the award of damages. With the rationale
of the Court of Appeals, such complaint can be
dismissed upon a motion to dismiss solely on the
ground that the presumption is that a person is
innocent of a wrong.
So obviously, the Decision of the Court of Appeals
cannot receive the imprimatur of this Court. Still, the
question of whether Lichauco may validly invoke state
immunity from suit to secure the outright dismissal of
petitioners' complaint warrants closer examination.
As earlier noted, the complaint alleges three (3) causes
of action against Lichauco: one for injunction against
her performing any act in relation to orbital slot 153º
East Longitude; one for declaration of nullity of award,
seeking to nullify the alleged award of orbital slot 153º
East Longitude; and one for damages against Lichauco
herself. Evidently, the first two causes of action stem
from Lichauco's act of offering orbital slot 153º East
Longitude for bidding, through the Notice of Offer which
was attached to the complaint.
In her Motion to Dismiss, Lichauco asserts that she is
being sued for issuing the aforementioned Notice of
Offer, which fell within her official functions as DOTC
Undersecretary for Communications. She claims that it
was Secretary Lagdameo who authorized her to offer
orbital slot 153º East Longitude for bidding, and she
thus acted well within the scope of her authority to
advise and assist the DOTC Secretary in the
formulation and implementation of department
objectives and policies.
The Notice of Offer cites Department Circular 97-01,
signed by then DOTC Secretary Arturo Enrile, as
authority for it. The Court has examined the
aforementioned Department Circular, issued on 17
October 1997, which establishes the "Guidelines on
the Procurement of Orbital Slots and Frequency
Registration of Philippine Satellites". Therein, the
DOTC is mandated "to conduct a bidding process in
case there are competing applications for any one of
the assigned or applied-for-orbital slots"28. Further, the
Department Circular states that "the DOTC shall
publish in three newspapers of general circulation a
notice of offer for the government assigned, initiated
and applied for orbital slots."29
Thus, insofar as the first two causes of action are
concerned, Lichauco may have a point when she
asserts that they were based on acts which she
performed in her capacity as DOTC Undersecretary.
But does this necessarily mean that these two causes
of action may thus be dismissed on the basis of state
immunity of suit?
As stated earlier, it is when the acts done in the
performance of official functions by an officer of the
government will result in a charge against or financial
liability to the government that the complaint must be
regarded as a suit against the State itself. However, the
distinction must also be raised between where the
government official concerned performs an act in
his/her official and jurisdictional capacity and where he
performs an act that constitutes grave abuse of
discretion tantamount to lack of jurisdiction. In the latter
case, the Constitution itself assures the availability of
judicial review, and it is the official concerned who
should be impleaded as the proper party- defendant or
respondent.
On this point, our ruling in J.M. Tuazon & Co. v. Land
Tenure Administration30 is material. Petitioners therein
had filed a special civil action for prohibition to nullify
Republic Act No. 2616, or law that directed the
expropriation of the Tatalon Estate in Quezon City.
Impleaded as respondents were the officials and
government agency tasked to undertake such
expropriation. The respondents alleged that the
petition for prohibition was actually a suit against the
State without its consent. The Court, through then
Associate Justice (later Chief Justice) Enrique
Fernando, debunked the argument, ruling instead that
the petition was within the ambit of judicial review:
[T]he power of judicial review is granted, if not
expressly, at least by clear implication from the
relevant provisions of the Constitution. This power may
be exercised when the party adversely affected by
either a legislative or executive act, or a municipal
ordinance for that matter, files the appropriate suit to
test its validity. The special civil action of prohibition
has been relied upon precisely to restrain the
enforcement of what is alleged to be an
unconstitutional statute. As it is a fundamental
postulate that the Constitution as the supreme law is
binding on all governmental agencies, failure to
observe the limitations found therein furnishes a
sufficient ground for a declaration of nullity of the
government measure challenged. The argument then
that the government is the adverse party and that,
therefore, must consent to its being sued certainly is far
from persuasive. x x x x31
The Court further noted that it was well-settled for the
purpose of obtaining a judicial declaration of nullity, "it
is enough if the respondents or defendants named be
the government officials who would give operation and
effect to official action allegedly tainted with
unconstitutionality."32
170
Unlike in J.M. Tuason, the case at bar does not seek
to nullify an unconstitutional law or measure. However,
the first two causes of action do sufficiently impute
grave abuse of discretion against Lichauco in her
official capacity. Since judicial review of acts alleged to
have been tainted with grave abuse of discretion is
guaranteed by the Constitution, it necessarily follows in
such instances that it is the official concerned who
should be impleaded as defendant or respondent in the
appropriate suit.
Moreover, if the suit had been directed against
Lichauco alone, and in her personal capacity, yet it
sought, as it now does, the nullification of the Notice of
Offer or the awards thereon, such remedy could not
avail even if granted. Lichauco, in her personal
capacity, cannot be directed to set aside the Notice of
Offer, the award of the bid, or to issue a new award
herself. It is only because Lichauco was sued in her
official capacity as the DOTC Undersecretary that she,
or her successors in office, could be judicially
compelled to act in such fashion.
As to the first two (2) causes of action, the Court rules
that the defense of state immunity from suit do not
apply since said causes of action cannot be properly
considered as suits against the State in constitutional
contemplation. These causes of action do not seek to
impose a charge or financial liability against the State,
but merely the nullification of state action. The prayers
attached to these two causes of action are for the
revocation of the Notice of Bid and the nullification of
the purported award, nothing more. Had it been so that
petitioner additionally sought damages in relation to
said causes of action, the suit would have been
considered as one against the State. Had the petitioner
impleaded the DOTC itself, an unincorporated
government agency, and not Lichauco herself, the suit
would have been considered as one against the State.
But neither circumstance obtains in this case.
Parenthetically, it may be noted that at the time of the
filing of the complaint, Lichauco herself was already the
acting head of the DOTC, owing to the sudden death
of then Secretary Enrile a few days before. At that
stage, any suit seeking to nullify the Notice of Bid and
the alleged award to the "Unknown Bidder" should
have properly denominated Lichauco as the
respondent, and not the DOTC.
Nonetheless, as to the first two causes of action, there
was a viable ground to dismiss the complaint: the non-
exhaustion of administrative remedies. Indeed, such
ground was alleged by Lichauco in her Motion to
Dismiss. Yet the principle of non-exhaustion of
administrative remedies admits to several exceptions.
In its Order denying the motion to dismiss the
complaint, the RTC adequately dispensed with the
objection, applying the established exceptions to the
rule of non-exhaustion of administrative remedies. To
wit:
Turning to the matter pertaining to non-exhaustion of
administrative remedies, it is fundamental that this
principle is not an inflexible rule. It yields to many
accepted exceptions. (Rocamora vs. RTC - Cebu, G.R.
No. 65307). As in this case, this principle can be
dispensed with when its application would cause great
and irreparable damage and when it does not provide
a plain, speedy and adequate remedy.
When the subject orbital slot 153 E was bidded out to
other applicants, the damage and injury plaintiffs stand
to suffer was clear, present, and substantiated that this
Court was impelled to provide urgent needed measure
such as the issuance of writ of injunction against the
public defendant. Indeed, under the circumstances
then obtaining it was impractical for the plaintiffs to first
proceed to the administrative official concerned before
taking court action.33
A different set of principles applies to the third cause of
action, anchored as it is on alleged acts that are
tortious in character or otherwise beyond the scope of
Lichauco's official duties. The complaint alleges that
Lichauco uttered several disparaging and defamatory
remarks against petitioners and made false assertions
against them in her letter to the Land Bank President.
The veracity of those allegations is of course presented
at the trial to be determined on the basis of the
evidence. However, if proven, they would establish
liability on the part of Lichauco that is not shielded by
the doctrine of state immunity from suit. The doctrine,
as summarized in Shauf v. Court of Appeals :34
While the doctrine appears to prohibit only suits against
the state without its consent, it is also applicable to
complaints filed against officials of the state for acts
allegedly performed by them in the discharge of their
duties. The rule is that if the judgment against such
officials will require the state itself to perform an
affirmative act to satisfy the same, such as the
appropriation of the amount needed to pay the
damages awarded against them, the suit must be
regarded as against the state itself although it has not
been formally impleaded. It must be noted, however,
that the rule is not so all-encompassing as to be
applicable under all circumstances.
It is a different matter where the public official is
made to account in his capacity as such for acts
contrary to law and injurious to the rights of
plaintiff. As was clearly set forth by Justice
Zaldivar in Director of the Bureau of
Telecommunications, et al. vs. Aligaen, etc., et al.
'Inasmuch as the State authorizes only legal acts
by its officers, unauthorized acts of government
officials or officers are not acts of the State, and an
action against the officials or officers by one
whose rights have been invaded or violated by
such acts, for the protection of his rights, is not a
suit against the State within the rule of immunity of
the State from suit. In the same tenor, it has been said
that an action at law or suit in equity against a State
officer or the director of a State department on the
ground that, while claiming to act for the State, he
violates or invades the personal and property rights or
the plaintiff, under an unconstitutional act or under an
assumption of authority which he does not have, is not
a suit against the State within the constitutional
provision that the State may not be sued without its
consent.' The rationale for this ruling is that the doctrine
of state immunity cannot be used as an instrument for
perpetrating an injustice.35
The doctrine poses no controversy if after trial on the
merits, it is established that the public official
concerned had committed illegal or tortious acts
against the plaintiff. How does it apply in relation to a
motion to dismiss on the ground of state immunity from
suit, necessarily lodged before trial on the merits?
Our ruling in United States of America v.
Reyes36 warrants due consideration. The Court
therein, through then Associate Justice (later Chief
Justice) Hilario G. Davide, Jr., ruled that a motion to
dismiss averring immunity from suit of a State and its
functionaries was actually grounded on the specific
ground for dismissal of the lack of cause of action, for
171
even assuming that the defendants had committed the ANTONIO T. CONCHITA CARPIO Communications of the Philippines, Inc.; and Smart
injurious acts complained of, "no action may be CARPIO MORALES Communications, Inc. See rollo, pp. 57-59.
maintained thereon, because of the principle of state Associate Justice Asscociate Justice 3
immunity."37 Pertinently, the Court noted that "a motion Id. at 60.
to dismiss on the ground of failure to state a cause of PRESBITERO J. VELASCO, JR. 4
Associate Justice Id. at 61.
action hypothetically admits the truth of the allegations
in the complaint." 5 Id. at 64.
ATTESTATION
Thus, Lichauco, in alleging in her Motion to Dismiss 6 Id. at 65.
that she is shielded by the State's immunity from suit, I attest that the conclusions in the above Decision had
to hypothetically admitted the truth of the allegations in been reached in consultation before the case was 7 The assignment of the other orbital slot, 161º East
the complaint. Such hypothetical admission has to be assigned to the writer of the opinion of the Court's Longitude, was previously affirmed by the DOTC to
deemed a concession on her part that she had Division. PASI and formally effected through an Agreement on
performed the tortious or damaging acts against the Transponder Agreement dated 16 June 1997. See
LEONARDO A. QUISUMBING
petitioners, which if true, would hold her liable for rollo, p. 89.
Associate Justice
damages.
Chairman, Third Division 8 See id. at 50.
Of course, Lichauco could very well raise the defense
CERTIFICATION 9 Id. at 50-51.
of state immunity from suit in regard to the third cause
of action with the assertion that the acts complained of Pursuant to Section 13, Article VII of the Constitution, 10
constituting said cause of action fell within her official Rollo, pp. 49-50.
and the Division Chairman's Attestation, it is hereby
functions and were not tortuous in character. Still, to certified that the conclusions in the above Decision 11 Id. at 51-52.
establish such assertions of fact, a full-blown trial on had been reached in consultation before the case was
the merits would be necessary, as would the case be if assigned to the writer of the opinion of the Court's 12 Id. at 53.
Lichauco raised the defense that she did not commit Division, 13
these acts complained of. Certainly, these defenses Penned by Judge Edwin D. Sorongon.
cannot be accorded merit before trial, factual as they ARTEMIO V. PANGANIBAN
14
are in character. Chief Justice Rollo, p. 112.
15
All told, contrary to the ruling of the Court of Appeals, Id. at 113.
we find no grave abuse of discretion on the part of the 16 Cited as 162 SCRA 88.
RTC in denying Lichauco's Motion to Dismiss.
Footnotes 17 Rollo, pp. 39-42.
WHEREFORE, the PETITION is GRANTED. The
1
Decision of the Court of Appeals dated 21 February Penned by Associate Justice Eugenio Labotoria, 18 Id. at 214.
2000 is SET ASIDE and the Order dated 14 August concurred in by Associate Justices Jesus Elbinias and
1998 of the Regional Trial Court of Mandaluyong City Marina Buzon. 19 See id. at 215.
is REINSTATED. The Regional Trial Court is ordered 2 Particularly consisting of Capitol Wireless, Inc.; 20 In her Comment, the Office of the Solicitor General,
to try and decide the case on the merits with deliberate
dispatch. No costs. Clavecilla Electronics and Telecom Corporation; Digital in behalf of Lichauco, states: "Respondent [Lichauco]
Telecommunications Philippines; Domestic Satellite attached the following to her petition filed before the
SO ORDERED. Phils.; Eastern Telecommunications Philippines, Inc.; Court of Appeals, to wit: (a) Original copies of the
Express Telecommunications Company; GMCR, Inc; assailed orders as Annexes "A" and "B"; (b)
DANTE O. TINGA International Communications Corporation; Isla [respondent]'s motion to dismiss as Annex "C"; (c)
Associate Justice Communications Company, Inc.; Liberty Broadcasting Copy of [respondent]'s motion for reconsideration as
Network, Inc; Philippine Communications Satellite Annex "D"; and (d) [petitioner]'s opposition to the
WE CONCUR: Corporation; Philippine Global Communications, Inc.; motion for reconsideration as Annex "E." See id. at
Philippine Long Distance Telephone Company; 214.
LEONARDO A. QUISUMBING
Pilipino Telephone Corporation; Radio
Associate Justice
Chairman
172
21See Section 8, Rule 45, 1997 Rules of Civil
Procedure.
22See Section 6, Rule 1, 1997 Rules of Civil
Procedure. Republic of the Philippines
23 SUPREME COURT
Rollo, p. 46.
Manila
24See e.g., Isberto v. Raquiza, G.R. No. L-35001, 25
THIRD DIVISION
September 1975, 67 SCRA 116, 119 (1975).
25 See e.g., Section 3(m), Rule 131, Rules of Court. G.R. No. 159186 June 5, 2009
26 See Section 3, Rule 131, Rules of Court. JESSE Y. YAP, Petitioner,
vs.
27 See Section 3(a), Rule 131, Rules of Court. HON. MONICO G. CABALES, Presiding Judge,
Regional Trial Court, Branch 35, General Santos
28Article III, sec. 6, DOTC Department Circular No. 97- City; MUNICIPAL TRIAL COURT, Branch 1,
01 (17 October 1997). General Santos City; COURT OF APPEALS,
PEOPLE OF THE PHILIPPINES, JOVITA
29 Article III, sec. 7, id. DIMALANTA and MERGYL
30 MIRABUENO, Respondents.
G.R. No. L-21064, 18 February 1970, 31 SCRA 413.
31 DECISION
Id. at 421-422.
PERALTA, J.:
32 Id. at 422.
This is a petition for review on certiorari under Rule 45
33 Rollo, p. 113.
of the Rules of Court with prayer for the issuance of a
34 G.R. No. 90314, 27 November 1990, 191 SCRA 713. writ of preliminary injunction and/or issuance of status
quo order seeking to annul and set aside the
35 Id. at 726-727. Citations omitted. Resolution1 of the Court of Appeals (CA) dated July 17,
2003 denying petitioner's motion for reconsideration of
36 Id. at 206.
the Decision2 dated April 30, 2003 in CA-G.R. SP No.
37
68250.
G.R. No. 79253, 1 March 1993, 219 SCRA 192.
The facts of the case are as follows:
Petitioner Jesse Y. Yap and his spouse Bessie Yap are
engaged in the real estate business through their
company Primetown Property Group.
Sometime in 1996, petitioner purchased several real
properties from a certain Evelyn Te (Evelyn). In
consideration of said purchases, petitioner issued
several Bank of the Philippine Islands (BPI) postdated
checks to Evelyn. Thereafter, spouses Orlando and
Mergyl Mirabueno and spouses Charlie and Jovita
Dimalanta, rediscounted the checks from Evelyn.
In the beginning, the first few checks were honored by
the bank, but in the early part of 1997, when the
remaining checks were deposited with the drawee
bank, they were dishonored for the reason that
the "Account is Closed."Demands were made by
Spouses Mirabueno and Spouses Dimalanta to the
petitioner to make good the checks. Despite this,
however, the latter failed to pay the amounts
represented by the said checks.
On December 8, 1997, Spouses Mirabueno filed a civil
action for collection of sum of money, damages and
attorney's fee with prayer for the issuance of a writ of
preliminary attachment against petitioner before the
Regional Trial Court (RTC) of General Santos City,
docketed as Civil Case No. 6231.3 On December 15,
1997, Spouses Dimalanta followed suit and instituted a
similar action, which was docketed as Civil Case No.
6238.4
Subsequently, on various dates, the Office of the City
Prosecutor of General Santos City filed several
informations for violation of Batas Pambansa Bilang
(B.P. Blg.) 22 against the petitioner with the Municipal
Trial Court in Cities (MTCC), General Santos City. The
criminal complaints were docketed as Criminal Case
Nos. 34873, 34874, 34862 to 34869, and Criminal
Case No. 35522-I.5
In the criminal cases, petitioner filed separate motions
to suspend proceedings on account of the existence of
a prejudicial question and motion to exclude the private
prosecutor from participating in the
proceedings.6 Petitioner prayed that the proceedings in
the criminal cases be suspended until the civil cases
pending before the RTC were finally resolved.
The MTCC, in its Orders7 dated June 21, 2000 and July
4, 2000, denied the motions for lack of merit. Petitioner
filed a Partial Motion for Reconsideration8 relative to
Criminal Case Nos. 34873, 34874, 34862 to 34869 and
a Motion for Reconsideration of the Part of the Order
Denying the Motion to Suspend Proceedings on
Account of the Existence of a Prejudicial Question
relative to Criminal Case No. 35522-I.9 The
subsequent motions were denied in the Order10 dated
October 18, 2000.
Aggrieved, petitioner filed a Petition for Certiorari with
a Prayer for the Issuance of a Writ of Preliminary
Injunction11 before the RTC, docketed as SPL. Civil
Case No. 539, imputing grave abuse of discretion on
173
the part of the MTCC Judge. On July 2, 2001, the RTC
issued an Order12 denying the petition.
Petitioner then filed a Motion for
Reconsideration,13 which was denied in an Order
dated October 18, 2001.14
Thereafter, petitioner filed with the CA a Petition
for Certiorari Prohibition and Mandamus with Urgent
Prayer for the Issuance of Status Quo Order and Writ
of Preliminary Injunction,15 docketed as CA-G.R. SP
No. 68250.
On April 30, 2003, the CA rendered a
Decision16 dismissing the petition for lack of merit. The
CA opined that Civil Case Nos. 6231 and 6238 did not
pose a prejudicial question to the prosecution of the
petitioner for violation of B.P. Blg. 22.
The CA ruled:
In the instant case, a careful perusal of Civil Cases
Nos. 6231 and 6238 reveals that the issue involved
therein is not the validity of the sale as incorrectly
pointed out by the petitioner, but it is, whether or not
the complainants therein are entitled to collect from the
petitioner the sum or the value of the checks which they
have rediscounted from Evelyn Te. It behooves this
Court to state that the sale and the rediscounting of the
checks are two transactions, separate and distinct from
each other. It so happened that in the subject civil
cases it is not the sale that is in question, but rather the
rediscounting of the checks. Therefore, petitioner's
contention that the main issue involved in said civil
cases is the validity of the sale stands on hollow
ground. Furthermore, if it is indeed the validity of the
sale that is contested in the subject civil cases, then,
We cannot fathom why the petitioner never contested
such sale by filing an action for the annulment thereof
or at least invoked or prayed in his answer that the sale
be declared null and void. Accordingly, even if Civil
Cases Nos. 6231 and 6238 are tried and the resolution
of the issues therein is had, it cannot be deduced
therefrom that the petitioner cannot be held liable
anymore for violation of B.P. Blg. 22.17
Petitioner filed a Motion for Reconsideration, 18
which
was denied in the Order19 dated July 17, 2003.
Hence, the petition assigning the following errors:
1. THE HONORABLE COURT OF APPEALS ERRED
IN RULING THAT THERE IS NO PREJUDICIAL
QUESTION IN THE CIVIL CASES (FOR
COLLECTION OF SUMS OF MONEY INSTITUTED
BY PRIVATE RESPONDENTS OVER CHECKS
ISSUED BY THE PETITIONER, CIVIL CASE NOS.
6238 AND 6231) THAT WOULD WARRANT
SUSPENSION OF THE CRIMINAL CASES (CASE
NO. 35522-1, FOR VIOLATION OF B.P. 22, SUBJECT
OF WHICH ARE THE VERY SAME CHECKS).
2. THE HONORABLE COURT OF APPEALS ERRED
IN NOT GRANTING THE PRAYER FOR THE
ISSUANCE OF A WRIT OF PRELIMINARY
INJUNCTION AND/OR STATUS QUO ORDER.20
The main contention of the petitioner is that a
prejudicial question, as defined by law and
jurisprudence, exists in the present case. It is the
petitioner's assertion that Civil Case Nos. 6231 and
6238 for collection of sum of money and damages were
filed ahead of the criminal cases for violation of B.P.
Blg. 22. He further alleged that, in the pending civil
cases, the issue as to whether private respondents are
entitled to collect from the petitioner despite the lack of
consideration, is an issue that is a logical antecedent
to the criminal cases for violation of B.P. Blg. 22. For if
the court rules that there is no valid consideration for
the check's issuance, as petitioner contends, then it
necessarily follows that he could not also be held liable
for violation of B.P. Blg. 22.
Petitioner further avers that B.P. Blg. 22 specifically
requires, among other elements, that the check should
have been issued for account or for value. There must
be a valid consideration; otherwise, no violation of the
said law could be rightfully pursued. Petitioner said that
the reason for the dishonor of the checks was his order
to the drawee bank to stop payment and to close his
account in order to avoid necessary penalty from the
bank. He made this order due to the failure of Evelyn
to deliver to him the titles to the purchased properties
to him.
On the other hand, the Office of the Solicitor General
(OSG) contends that there is no prejudicial question in
Civil Case Nos. 6231 and 6238 which would warrant
the suspension of the proceedings in the criminal
cases for violation of B.P. Blg. 22 against the petitioner.
The issue in the civil cases is not the validity of the sale
between the petitioner and Evelyn, but whether the
complainants therein are entitled to damages arising
from the checks. These checks were issued by the
petitioner in favor of Evelyn, who, thereafter,
negotiated the same checks to private complainants.
The checks were subsequently dishonored due to
insufficiency of funds. The OSG maintains that the
resolution of such issue has absolutely no bearing on
the issue of whether petitioner may be held liable for
violation of B.P. Blg. 22.21
The present case hinges on the determination of
whether there exists a prejudicial question that
necessitates the suspension of the proceedings in the
MTCC.
We find that there is none and, thus, we resolve to deny
the petition.
A prejudicial question generally exists in a situation
where a civil action and a criminal action are both
pending, and there exists in the former an issue that
must be preemptively resolved before the latter may
proceed, because howsoever the issue raised in the
civil action is resolved would be determinative juris et
de jure of the guilt or innocence of the accused in the
criminal case. The rationale behind the principle of
prejudicial question is to avoid two conflicting
decisions. It has two essential elements: (i) the civil
action involves an issue similar or intimately related to
the issue raised in the criminal action; and (ii) the
resolution of such issue determines whether or not the
criminal action may proceed.22
If both civil and criminal cases have similar issues, or
the issue in one is intimately related to the issues
raised in the other, then a prejudicial question would
likely exist, provided the other element or characteristic
is satisfied. It must appear not only that the civil case
involves the same facts upon which the criminal
prosecution would be based, but also that the
resolution of the issues raised in the civil action would
be necessarily determinative of the guilt or innocence
of the accused. If the resolution of the issue in the civil
action will not determine the criminal responsibility of
the accused in the criminal action based on the same
facts, or if there is no necessity that the civil case be
determined first before taking up the criminal case, the
civil case does not involve a prejudicial
question.23 Neither is there a prejudicial question if the
174
civil and the criminal action can, according to law,
proceed independently of each other.24
The issue in the criminal cases is whether the petitioner
is guilty of violating B.P. Blg. 22, while in the civil case,
it is whether the private respondents are entitled to
collect from the petitioner the sum or the value of the
checks that they have rediscounted from
Evelyn.lavvphil
The resolution of the issue raised in the civil action is
not determinative of the guilt or innocence of the
accused in the criminal cases against him, and there is
no necessity that the civil case be determined first
before taking up the criminal cases.
In the aforementioned civil actions, even if petitioner is
declared not liable for the payment of the value of the
checks and damages, he cannot be adjudged free from
criminal liability for violation of B.P. Blg. 22. The mere
issuance of worthless checks with knowledge of the
insufficiency of funds to support the checks is in itself
an offense.25
In Jose v. Suarez,26 the prejudicial question under
determination was whether the daily interest rate of 5%
was void, such that the checks issued by respondents
to cover said interest were likewise void for
being contra bonos mores, and thus the cases for B.P.
Blg. 22 will no longer prosper. In resolving the issue,
We ruled that "whether or not the interest rate imposed
by petitioners is eventually declared void for
being contra bonos mores will not affect the outcome
of the BP Blg. 22 cases because what will ultimately be
penalized is the mere issuance of bouncing checks. In
fact, the primordial question posed before the court
hearing the B.P. Blg. 22 cases is whether the law has
been breached; that is, if a bouncing check has been
issued."
Further, We held in Ricaforte v. Jurado,27 that:
The gravamen of the offense punished by B.P. Blg. 22
is the act of making and issuing a worthless check; that
is, a check that is dishonored upon its presentation for
payment. In Lozano v. Martinez, we have declared that
it is not the non-payment of an obligation which the law
punishes. The law is not intended or designed to
coerce a debtor to pay his debt. The thrust of the law is
to prohibit, under pain of penal sanctions, the making
and circulation of worthless checks. Because of its
deleterious effects on the public interest, the practice is
proscribed by the law. The law punishes the act not as
an offense against property, but an offense against
public order. In People v. Nitafan, we said that a check
issued as an evidence of debt - though not intended to
be presented for payment - has the same effect as an
ordinary check and would fall within the ambit of B.P.
Blg. 22.
xxxx
x x x The mere act of issuing a worthless check -
whether as a deposit, as a guarantee or even as
evidence of pre-existing debt - is malum prohibitum.
To determine the reason for which checks are issued,
or the terms and conditions for their issuance, will
greatly erode the faith the public reposes in the stability
and commercial value of checks as currency
substitutes, and bring about havoc in trade and in
banking communities. So what the law punishes is the
issuance of a bouncing check and not the purpose for
which it was issued or the terms and conditions relating
to its issuance. The mere act of issuing a worthless
check is malum prohibitum.28
Moreover, petitioner's reliance on Ras v. Rasul29 is
misplaced. The case of Ras involves a complaint for
nullification of a deed of sale on the ground of an
alleged double sale. While the civil case was pending,
an information for estafa was filed against Ras (the
defendant in the civil case) arising from the same
alleged double sale, subject matter of the civil
complaint. The Court ruled that there was a prejudicial
question considering that the defense in the civil case
was based on the very same facts that would be
determinative of the guilt or innocence of the accused
in the estafa case.
The instant case is different from Ras, inasmuch as the
determination of whether the petitioner is liable to pay
the private respondents the value of the checks and
damages, will not affect the guilt or innocence of the
petitioner because the material question in the criminal
cases is whether petitioner had issued bad checks,
regardless of the purpose or condition of its issuance.
Guided by the following legal precepts, it is clear that
the determination of the issues involved in Civil Case
Nos. 6231 and 6238 for collection of sum of money and
damages is irrelevant to the guilt or innocence of the
petitioner in the criminal cases for violation of B.P. Blg.
22.
In addition, petitioner's claim of lack of consideration
may be raised as a defense during the trial of the
criminal cases against him. The validity and merits of a
party’s defense and accusation, as well as the
admissibility and weight of testimonies and evidence
brought before the court, are better ventilated during
trial proper.
Precisely, the reason why a state has courts of law is
to ascertain the respective rights of the parties, to
examine and to put to test all their respective
allegations and evidence through a well designed
machinery termed "trial."Thus, all the defenses
available to the accused should be invoked in the trial
of the criminal cases. This court is not the
proper forum that should ascertain the facts and
decide the case for violation of B.P. Blg. 22 filed against
the petitioner.
In fine, the CA committed no reversible error in
affirming the decision of the RTC.
WHEREFORE, the petition is DENIED and the
Decision dated April 30, 2003 and the Resolution dated
July 17, 2003 of the Court of Appeals in CA-G.R. SP
No. 68250 are AFFIRMED.
SO ORDERED.
DIOSDADO M. PERALTA
Associate Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
ANTONIO T. CARPIO* RENATO C. CORONA**
Associate Justice Associate Justice
ANTONIO EDUARDO B. NACHURA
Associate Justice
ATTESTATION
175
 11
I attest that the conclusions in the above Decision had Id. at 152-164.
been reached in consultation before the case was
12
assigned to the writer of the opinion of the Court’s Id. at 66-67.
Division. 13 Id. at 45.
CONSUELO YNARES-SANTIAGO 14 Id.
Associate Justice
Third Division, Chairperson 15 Id. at 44-65.
CERTIFICATION 16 Id. at 33-41.
Pursuant to Section 13, Article VIII of the Constitution 17 Id. at 37-38.
and the Division Chairperson’s Attestation, I certify
that the conclusions in the above Decision were 18 Id. at 105-107.
reached in consultation before the case was assigned
19
to the writer of the opinion of the Court’s Division. Id. at 30-32.
20
REYNATO S. PUNO Id. at 22.
Chief Justice 21 Id. at 298-311.
22Jose v. Suarez, G.R. No. 176795, June 30, 2008,
556 SCRA 773, 781-782, citing Carlos v. Court of
Footnotes Appeals, 335 Phil. 490, 499 (1997) and Tuanda v.
Sandiganbayan, 249 SCRA 342 (1995).
*Designated to sit as an additional member, per
23
Special Order No. 646 dated May158, 2009. People v. Consing, Jr., G.R. No. 148193, January
16, 2003, 395 SCRA 366, 370, citing Sabandal v.
**
Designated to sit as an additional member, per Tongco, 366 SCRA 567 (2001), Alano v. Court of
Special Order No. 631 dated April 29, 2009. Appeals, 347 Phil. 549 (1997), Benitez v. Concepcion,
1
Jr., 112 Phil. 105 (1961), Te v. Court of Appeals, 346
Penned by Associate Justice Bienvenido L. Reyes, SCRA 327 (2000), Beltran v. People, 334 SCRA 106
with Associate Justices Salvador J. Valdez, Jr. and (2000), and Isip v. Gonzales, 148-A Phil. 212 (1971).
Danilo B. Pine, concurring, rollo, pp. 30-32.
24
2
Sabandal v. Tongco, supra note 23, citing Rojas v.
Id. at 33-41. People, 156 Phil. 224, 229 (1974).
3 Id. at 97-103. 25Lozano v. Martinez, G.R. No. L-63419, December
4 18, 1986, 146 SCRA 323.
Id. at 90-96.
26
5 Supra note 22.
Id. at 68-89.
27
6 Id. at 219-223; 224-228. G.R. No. 154438, September 5, 2007, 532 SCRA
317, 330. (Emphasis supplied).
7 Id. at 165; 166. 28Wong v. Court of Appeals, G.R. No. 117857,
8 Id. at 229-235. February 2, 2001, 351 SCRA 100, citing Llamado v.
Court of Appeals, 270 SCRA 423, 431 (1997).
9 Id. at 236-238.
29
G.R. Nos. L-50441-42, September 18, 1980, 100
10 Id. at 167-168. SCRA 125.

176

Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 184861 June 30, 2009
DREAMWORK CONSTRUCTION, INC., Petitioner,
vs.
CLEOFE S. JANIOLA and HON. ARTHUR A.
FAMINI, Respondents.
DECISION
VELASCO, JR., J.:
The Case
Petitioner Dreamwork Construction, Inc. seeks the
reversal of the August 26, 2008 Decision1 in SCA No.
08-0005 of the Regional Trial Court (RTC), Branch 253
in Las Piñas City. The Decision affirmed the Orders
dated October 16, 20072 and March 12, 20083 in
Criminal Case Nos. 55554-61 issued by the
Metropolitan Trial Court (MTC), Branch 79 in Las Piñas
City.
The Facts
On October 18, 2004, petitioner, through its President,
Roberto S. Concepcion, and Vice-President for
Finance and Marketing, Normandy P. Amora, filed a
Complaint Affidavit dated October 5, 20044 for violation
of Batas Pambansa Bilang 22 (BP 22) against private
respondent Cleofe S. Janiola with the Office of the City
Prosecutor of Las Piñas City. The case was docketed
as I.S. No. 04-2526-33. Correspondingly, petitioner
filed a criminal information for violation of BP 22 against
private respondent with the MTC on February 2, 2005
docketed as Criminal Case Nos. 55554-61, entitled
People of the Philippines v. Cleofe S. Janiola.
On September 20, 2006, private respondent, joined by
her husband, instituted a civil complaint against
petitioner by filing a Complaint dated August 2006 5 for
the rescission of an alleged construction agreement
between the parties, as well as for damages. The case
was filed with the RTC, Branch 197 in Las Piñas City
and docketed as Civil Case No. LP-06-0197. Notably,
the checks, subject of the criminal cases before the
MTC, were issued in consideration of the construction
agreement.
Thereafter, on July 25, 2007, private respondent filed a
Motion to Suspend Proceedings dated July 24,
20076 in Criminal Case Nos. 55554-61, alleging that
the civil and criminal cases involved facts and issues
similar or intimately related such that in the resolution
of the issues in the civil case, the guilt or innocence of
the accused would necessarily be determined. In other
words, private respondent claimed that the civil case
posed a prejudicial question as against the criminal
cases.
Petitioner opposed the suspension of the proceedings
in the criminal cases in an undated
Comment/Opposition to Accused’s Motion to Suspend
Proceedings based on Prejudicial Question7 on the
grounds that: (1) there is no prejudicial question in this
case as the rescission of the contract upon which the
bouncing checks were issued is a separate and distinct
issue from the issue of whether private respondent
violated BP 22; and (2) Section 7, Rule 111 of the
Rules of Court states that one of the elements of a
prejudicial question is that "the previously instituted
civil action involves an issue similar or intimately
related to the issue raised in the subsequent criminal
action"; thus, this element is missing in this case, the
criminal case having preceded the civil case.
Later, the MTC issued its Order dated October 16,
2007, granting the Motion to Suspend Proceedings,
and reasoned that:
Should the trial court declare the rescission of contract
and the nullification of the checks issued as the same
are without consideration, then the instant criminal
cases for alleged violation of BP 22 must be dismissed.
The belated filing of the civil case by the herein
177
accused did not detract from the correctness of her
cause, since a motion for suspension of a criminal
action may be filed at any time before the prosecution
rests (Section 6, Rule 111, Revised Rules of Court).8
In an Order dated March 12, 2008,9 the MTC denied
petitioner’s Motion for Reconsideration dated
November 29, 2007.
Petitioner appealed the Orders to the RTC with a
Petition dated May 13, 2008. Thereafter, the RTC
issued the assailed decision dated August 26, 2008,
denying the petition. On the issue of the existence of a
prejudicial question, the RTC ruled:
Additionally, it must be stressed that the requirement of
a "previously" filed civil case is intended merely to
obviate delays in the conduct of the criminal
proceedings. Incidentally, no clear evidence of any
intent to delay by private respondent was shown. The
criminal proceedings are still in their initial stages when
the civil action was instituted. And, the fact that the civil
action was filed after the criminal action was instituted
does not render the issues in the civil action any less
prejudicial in character.10
Hence, we have this petition under Rule 45.
The Issue
WHETHER OR NOT THE COURT A QUO
SERIOUSLY ERRED IN NOT PERCEIVING GRAVE
ABUSE OF DISCRETION ON THE PART OF THE
INFERIOR COURT, WHEN THE LATTER RULED TO
SUSPEND PROCEEDINGS IN CRIM. CASE NOS.
55554-61 ON THE BASIS OF "PREJUDICIAL
QUESTION" IN CIVIL CASE NO. LP-06-0197.11
The Court’s Ruling
This petition must be granted.
The Civil Action Must Precede the Filing of the
Criminal Action for a Prejudicial Question to Exist
Under the 1985 Rules on Criminal Procedure, as
amended by Supreme Court Resolutions dated June
17, 1988 and July 7, 1988, the elements of a prejudicial
question are contained in Rule 111, Sec. 5, which
states:
SEC. 5. Elements of prejudicial question. — The two
(2) essential elements of a prejudicial question are: (a)
the civil action involves an issue similar or intimately
related to the issue raised in the criminal action; and
(b) the resolution of such issue determines whether or
not the criminal action may proceed.
Thus, the Court has held in numerous cases12 that the
elements of a prejudicial question, as stated in the
above-quoted provision and in Beltran v. People,13 are:
The rationale behind the principle of prejudicial
question is to avoid two conflicting decisions. It has two
essential elements: (a) the civil action involves an issue
similar or intimately related to the issue raised in the
criminal action; and (b) the resolution of such issue
determines whether or not the criminal action may
proceed.
On December 1, 2000, the 2000 Rules on Criminal
Procedure, however, became effective and the above
provision was amended by Sec. 7 of Rule 111, which
applies here and now provides:
SEC. 7. Elements of prejudicial question.—The
elements of a prejudicial question are: (a) the
previously instituted civil action involves an issue
similar or intimately related to the issue raised in the
subsequent criminal action, and (b) the resolution of
such issue determines whether or not the criminal
action may proceed. (Emphasis supplied.)
Petitioner interprets Sec. 7(a) to mean that in order for
a civil case to create a prejudicial question and, thus,
suspend a criminal case, it must first be established
that the civil case was filed previous to the filing of the
criminal case. This, petitioner argues, is specifically to
guard against the situation wherein a party would
belatedly file a civil action that is related to a pending
criminal action in order to delay the proceedings in the
latter.
On the other hand, private respondent cites Article 36
of the Civil Code which provides:
Art. 36. Pre-judicial questions which must be decided
before any criminal prosecution may be instituted or
may proceed, shall be governed by rules of court which
the Supreme Court shall promulgate and which shall
not be in conflict with the provisions of this Code.
(Emphasis supplied.)
Private respondent argues that the phrase "before any
criminal prosecution may be instituted or may proceed"
must be interpreted to mean that a prejudicial question
exists when the civil action is filed either before the
institution of the criminal action or during the pendency
of the criminal action. Private respondent concludes
that there is an apparent conflict in the provisions of the
Rules of Court and the Civil Code in that the latter
considers a civil case to have presented a prejudicial
question even if the criminal case preceded the filing of
the civil case.
We cannot agree with private respondent.
First off, it is a basic precept in statutory construction
that a "change in phraseology by amendment of a
provision of law indicates a legislative intent to change
the meaning of the provision from that it originally
had."14 In the instant case, the phrase, "previously
instituted," was inserted to qualify the nature of the civil
action involved in a prejudicial question in relation to
the criminal action. This interpretation is further
buttressed by the insertion of "subsequent" directly
before the term criminal action. There is no other
logical explanation for the amendments except to
qualify the relationship of the civil and criminal actions,
that the civil action must precede the criminal action.
Thus, this Court ruled in Torres v. Garchitorena15 that:
Even if we ignored petitioners’ procedural lapse and
resolved their petition on the merits, we hold that
Sandiganbayan did not abuse its discretion amounting
to excess or lack of jurisdiction in denying their
omnibus motion for the suspension of the proceedings
pending final judgment in Civil Case No. 7160. Section
6, Rule lll of the Rules of Criminal Procedure, as
amended, reads:
Sec. 6. Suspension by reason of prejudicial question. -
A petition for suspension of the criminal action based
upon the pendency of a prejudicial question in a civil
action may be filed in the office of the prosecutor or the
court conducting the preliminary investigation. When
the criminal action has been filed in court for trial, the
petition to suspend shall be filed in the same criminal
action at any time before the prosecution rests.
Sec. 7. Elements of prejudicial question. - The
elements of a prejudicial question are: (a) the
178
previously instituted civil action involves an issue
similar or intimately related to the issue raised in the
subsequent criminal action, and (b) the resolution of
such issue determines whether or not the criminal
action may proceed.
Under the amendment, a prejudicial question is
understood in law as that which must precede the
criminal action and which requires a decision before a
final judgment can be rendered in the criminal action
with which said question is closely connected. The civil
action must be instituted prior to the institution of the
criminal action. In this case, the Information was filed
with the Sandiganbayan ahead of the complaint in Civil
Case No. 7160 filed by the State with the RTC in Civil
Case No. 7160. Thus, no prejudicial question exists.
(Emphasis supplied.)
Additionally, it is a principle in statutory construction
that "a statute should be construed not only to be
consistent with itself but also to harmonize with other
laws on the same subject matter, as to form a
complete, coherent and intelligible system."16 This
principle is consistent with the maxim, interpretare et
concordare leges legibus est optimus interpretandi
modus or every statute must be so construed and
harmonized with other statutes as to form a uniform
system of jurisprudence.171 a vv p h i l
In other words, every effort must be made to harmonize
seemingly conflicting laws. It is only when
harmonization is impossible that resort must be made
to choosing which law to apply.
In the instant case, Art. 36 of the Civil Code and Sec. 7
of Rule 111 of the Rules of Court are susceptible of an
interpretation that would harmonize both provisions of
law. The phrase "previously instituted civil action" in
Sec. 7 of Rule 111 is plainly worded and is not
susceptible of alternative interpretations. The clause
"before any criminal prosecution may be instituted or
may proceed" in Art. 36 of the Civil Code may,
however, be interpreted to mean that the motion to
suspend the criminal action may be filed during the
preliminary investigation with the public prosecutor or
court conducting the investigation, or during the trial
with the court hearing the case.
This interpretation would harmonize Art. 36 of the Civil
Code with Sec. 7 of Rule 111 of the Rules of Court but
also with Sec. 6 of Rule 111 of the Civil Code, which
provides for the situations when the motion to suspend
the criminal action during the preliminary investigation
or during the trial may be filed. Sec. 6 provides:
SEC. 6. Suspension by reason of prejudicial
question.—A petition for suspension of the criminal
action based upon the pendency of a prejudicial
question in a civil action may be filed in the office of the
prosecutor or the court conducting the preliminary
investigation. When the criminal action has been filed
in court for trial, the petition to suspend shall be filed in
the same criminal action at any time before the
prosecution rests.
Thus, under the principles of statutory construction, it
is this interpretation of Art. 36 of the Civil Code that
should govern in order to give effect to all the relevant
provisions of law.
It bears pointing out that the circumstances present in
the instant case indicate that the filing of the civil action
and the subsequent move to suspend the criminal
proceedings by reason of the presence of a prejudicial
question were a mere afterthought and instituted to
delay the criminal proceedings.
In Sabandal v. Tongco,18 we found no prejudicial
question existed involving a civil action for specific
performance, overpayment, and damages, and a
criminal complaint for BP 22, as the resolution of the
civil action would not determine the guilt or innocence
of the accused in the criminal case. In resolving the
case, we said:
Furthermore, the peculiar circumstances of the case
clearly indicate that the filing of the civil case was a ploy
to delay the resolution of the criminal cases. Petitioner
filed the civil case three years after the institution of the
criminal charges against him. Apparently, the civil
action was instituted as an afterthought to delay the
proceedings in the criminal cases.19
Here, the civil case was filed two (2) years after the
institution of the criminal complaint and from the time
that private respondent allegedly withdrew its
equipment from the job site. Also, it is worth noting that
the civil case was instituted more than two and a half
(2 ½) years from the time that private respondent
allegedly stopped construction of the proposed building
for no valid reason. More importantly, the civil case
praying for the rescission of the construction
agreement for lack of consideration was filed more
than three (3) years from the execution of the
construction agreement.
Evidently, as in Sabandal, the circumstances
surrounding the filing of the cases involved here show
that the filing of the civil action was a mere afterthought
on the part of private respondent and interposed for
delay. And as correctly argued by petitioner, it is this
scenario that Sec. 7 of Rule 111 of the Rules of Court
seeks to prevent. Thus, private respondent’s positions
cannot be left to stand.
The Resolution of the Civil Case Is Not Determinative
of the Prosecution of the Criminal Action
In any event, even if the civil case here was instituted
prior to the criminal action, there is, still, no prejudicial
question to speak of that would justify the suspension
of the proceedings in the criminal case.
To reiterate, the elements of a prejudicial question
under Sec. 7 of Rule 111 of the Rules of Court are: (1)
the previously instituted civil action involves an issue
similar or intimately related to the issue raised in the
subsequent criminal action; and (2) the resolution of
such issue determines whether or not the criminal
action may proceed.
Petitioner argues that the second element of a
prejudicial question, as provided in Sec. 7 of Rule 111
of the Rules, is absent in this case. Thus, such rule
cannot apply to the present controversy.
Private respondent, on the other hand, claims that if the
construction agreement between the parties is
declared null and void for want of consideration, the
checks issued in consideration of such contract would
become mere scraps of paper and cannot be the basis
of a criminal prosecution.
We find for petitioner.
It must be remembered that the elements of the crime
punishable under BP 22 are as follows:
(1) the making, drawing, and issuance of any check to
apply for account or for value;
179
(2) the knowledge of the maker, drawer, or issuer that
at the time of issue there are no sufficient funds in or
credit with the drawee bank for the payment of such
check in full upon its presentment; and
(3) the subsequent dishonor of the check by the
drawee bank for insufficiency of funds or credit, or
dishonor for the same reason had not the drawer,
without any valid cause, ordered the bank to stop
payment.20
Undeniably, the fact that there exists a valid contract or
agreement to support the issuance of the check/s or
that the checks were issued for valuable consideration
does not make up the elements of the crime. Thus, this
Court has held in a long line of cases 21 that the
agreement surrounding the issuance of dishonored
checks is irrelevant to the prosecution for violation of
BP 22. In Mejia v. People,22 we ruled:
It must be emphasized that the gravamen of the
offense charge is the issuance of a bad check. The
purpose for which the check was issued, the terms and
conditions relating to its issuance, or any agreement
surrounding such issuance are irrelevant to the
prosecution and conviction of petitioner. To determine
the reason for which checks are issued, or the terms
and conditions for their issuance, will greatly erode the
faith the public reposes in the stability and commercial
value of checks as currency substitutes, and bring
havoc in trade and in banking communities. The clear
intention of the framers of B.P. 22 is to make the mere
act of issuing a worthless check malum prohibitum.
Lee v. Court of Appeals23 is even more poignant. In
that case, we ruled that the issue of lack of valuable
consideration for the issuance of checks which were
later on dishonored for insufficient funds is immaterial
to the success of a prosecution for violation of BP 22,
to wit:
Third issue. Whether or not the check was issued on
account or for value.
Petitioner’s claim is not feasible. We have held that
upon issuance of a check, in the absence of evidence
to the contrary, it is presumed that the same was
issued for valuable consideration. Valuable
consideration, in turn, may consist either in some right,
interest, profit or benefit accruing to the party who
makes the contract, or some forbearance, detriment, 55554-61 of the MTC, Branch 79 in Las Piñas City. We
loss or some responsibility, to act, or labor, or service order the MTC to continue with the proceedings in
given, suffered or undertaken by the other side. It is an Criminal Case Nos. 55554-61 with dispatch.
obligation to do, or not to do in favor of the party who
makes the contract, such as the maker or indorser. No costs.
In this case, petitioner himself testified that he signed SO ORDERED.
several checks in blank, the subject check included, in
PRESBITERO J. VELASCO, JR.
exchange for 2.5% interest from the proceeds of loans
Associate Justice
that will be made from said account. This is a valuable
consideration for which the check was issued. That WE CONCUR:
there was neither a pre-existing obligation nor an
obligation incurred on the part of petitioner when the CONSUELO YNARES-SANTIAGO
subject check was given by Bautista to private Associate Justice
complainant on July 24, 1993 because petitioner was Chairperson
no longer connected with Unlad or Bautista starting
July 1989, cannot be given merit since, as earlier MINITA V. CHICO- ANTONIO EDUARDO
discussed, petitioner failed to adequately prove that he NAZARIO B. NACHURA
has severed his relationship with Bautista or Unlad. Associate Justice Associate Justice
At any rate, we have held that what the law punishes is DIOSDADO M. PERALTA
the mere act of issuing a bouncing check, not the Associate Justice
purpose for which it was issued nor the terms and
conditions relating to its issuance. This is because the ATTESTATION
thrust of the law is to prohibit the making of worthless
I attest that the conclusions in the above Decision had
checks and putting them into circulation.24 (Emphasis
supplied.) been reached in consultation before the case was
assigned to the writer of the opinion of the Court’s
Verily, even if the trial court in the civil case declares Division.
that the construction agreement between the parties is
CONSUELO YNARES-SANTIAGO
void for lack of consideration, this would not affect the
Associate Justice
prosecution of private respondent in the criminal case.
Chairperson
The fact of the matter is that private respondent indeed
issued checks which were subsequently dishonored for CERTIFICATION
insufficient funds. It is this fact that is subject of
prosecution under BP 22.lawphil.net Pursuant to Section 13, Article VIII of the Constitution,
and the Division Chairperson’s Attestation, I certify
Therefore, it is clear that the second element required that the conclusions in the above Decision had been
for the existence of a prejudicial question, that the reached in consultation before the case was assigned
resolution of the issue in the civil action would to the writer of the opinion of the Court’s Division.
determine whether the criminal action may proceed, is
absent in the instant case. Thus, no prejudicial REYNATO S. PUNO
question exists and the rules on it are inapplicable to Chief Justice
the case before us.
WHEREFORE, we GRANT this petition. We hereby
REVERSE and SET ASIDE the August 26, 2008
Decision in SCA No. 08-0005 of the RTC, Branch 253 Footnotes
in Las Piñas City and the Orders dated October 16, 1
2007 and March 12, 2008 in Criminal Case Nos. Rollo, pp. 88-90. Penned by Judge Salvador V.
Timbang.
180
2 19
Id. at 65-67. Id. at 572.
3 20
Id. at 75-76. Mejia v. People, G.R. No. 149937, June 21, 2007,
525 SCRA 209, 213-214.
4 Id. at 23-27.
21Rigor v. People, G.R. No. 144887, November 17,
5 Id. at 28-41. 2004, 442 SCRA 451, 461; Narte v. Court of Appeals,
6 G.R. No. 132552, July 14, 2004, 434 SCRA 336, 341;
Id. at 42-45.
Lazaro v. Court of Appeals, G.R. No. 105461,
7 Id. at 46-48. November 11, 1993, 227 SCRA 723, 726-727, citing
People v. Nitafan, G.R. No. 75954, October 22, 1992,
8 215 SCRA 79, 84-85 and Que v. People, Nos. L-
Id. at 67.
75217-18, September 21, 1987, 154 SCRA 161, 165.
9 Id. at 75-76.
22 Supra note 20, at 214-215.
10 Id. at 90.
23 G.R. No. 145498, January 17, 2005, 448 SCRA 455.
11 Id. at 11.
24 Id. at 474-475.
12Carlos v. Court of Appeals, G.R. No. 109887,
February 10, 1997, 268 SCRA 25, 33; Tuanda v.
Sandiganbayan, G.R. No. 110544, October 17, 1995,
249 SCRA 342, 351; Apa v. Fernandez, G.R. No.
112381, March 30, 1995, 242 SCRA 509, 512; Yap v.
Paras, G.R. No.101236, January 30, 1994, 205 SCRA
625, 629; Umali v. IAC, G.R. No. 63198, June 21, 1990,
186 SCRA 680, 685.
13G.R. No. 137567, June 20, 2000, 334 SCRA 106,
110.
14R.E. Agpalo, Statutory Construction 97 (4th ed.,
1998).
15G.R. No. 153666, December 27, 2002, 394 SCRA
494, 508-509.
16 R.E. Agpalo, supra note 14, at 269-270.
17Algura v. The Local Government Unit of the City of
Naga, G.R. No. 150135, October 30, 2006, 506 SCRA
81, 98; Valencia v. Court of Appeals, G.R. No. 122363,
April 29, 2003, 401 SCRA 666, 680-81; Bañares v.
Balising, G.R. No. 132624, March 13, 2000, 328 SCRA
36, 49; Cabada v. Alunan III, G.R. No. 119645, August
22, 1996, 260 SCRA 838, 848; Republic v. Asuncion,
G.R. No. 108208, March 11, 1994, 231 SCRA 211;
Corona v. Court of Appeals, G.R. No. 97356,
September 30, 1992, 214 SCRA 378, 392.
18 G.R. No. 124498, October 5, 2001, 366 SCRA 567.

181

Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 172060 September 13, 2010
JOSELITO R. PIMENTEL, Petitioner,
vs.
MARIA CHRYSANTINE L. PIMENTEL and PEOPLE
OF THE PHILIPPINES, Respondents.
DECISION
CARPIO, J.:
The Case
Before the Court is a petition for review1 assailing the
Decision2 of the Court of Appeals, promulgated on 20
March 2006, in CA-G.R. SP No. 91867.
The Antecedent Facts
The facts are stated in the Court of Appeals’ decision:
On 25 October 2004, Maria Chrysantine Pimentel y
Lacap (private respondent) filed an action for frustrated
parricide against Joselito R. Pimentel (petitioner),
docketed as Criminal Case No. Q-04-130415, before
the Regional Trial Court of Quezon City, which was
raffled to Branch 223 (RTC Quezon City).
On 7 February 2005, petitioner received summons to
appear before the Regional Trial Court of Antipolo City,
Branch 72 (RTC Antipolo) for the pre-trial and trial of
Civil Case No. 04-7392 (Maria Chrysantine Lorenza L.
Pimentel v. Joselito Pimentel) for Declaration of Nullity
of Marriage under Section 36 of the Family Code on
the ground of psychological incapacity.
On 11 February 2005, petitioner filed an urgent motion
to suspend the proceedings before the RTC Quezon
City on the ground of the existence of a prejudicial
question. Petitioner asserted that since the relationship
between the offender and the victim is a key element
in parricide, the outcome of Civil Case No. 04-7392
would have a bearing in the criminal case filed against
him before the RTC Quezon City.
The Decision of the Trial Court
The RTC Quezon City issued an Order dated 13 May
20053 holding that the pendency of the case before the
RTC Antipolo is not a prejudicial question that warrants
the suspension of the criminal case before it. The RTC
Quezon City held that the issues in Criminal Case No.
Q-04-130415 are the injuries sustained by respondent
and whether the case could be tried even if the validity
of petitioner’s marriage with respondent is in question.
The RTC Quezon City ruled:
WHEREFORE, on the basis of the foregoing, the
Motion to Suspend Proceedings On the [Ground] of the
Existence of a Prejudicial Question is, for lack of merit,
DENIED.
SO ORDERED.4
Petitioner filed a motion for reconsideration. In its 22
August 2005 Order,5 the RTC Quezon City denied the
motion.
Petitioner filed a petition for certiorari with application
for a writ of preliminary injunction and/or temporary
restraining order before the Court of Appeals, assailing
the 13 May 2005 and 22 August 2005 Orders of the
RTC Quezon City.
The Decision of the Court of Appeals
In its 20 March 2006 Decision, the Court of Appeals
dismissed the petition. The Court of Appeals ruled that
in the criminal case for frustrated parricide, the issue is
whether the offender commenced the commission of
the crime of parricide directly by overt acts and did not
perform all the acts of execution by reason of some
cause or accident other than his own spontaneous
desistance. On the other hand, the issue in the civil
182
action for annulment of marriage is whether petitioner
is psychologically incapacitated to comply with the
essential marital obligations. The Court of Appeals
ruled that even if the marriage between petitioner and
respondent would be declared void, it would be
immaterial to the criminal case because prior to the
declaration of nullity, the alleged acts constituting the
crime of frustrated parricide had already been
committed. The Court of Appeals ruled that all that is
required for the charge of frustrated parricide is that at
the time of the commission of the crime, the marriage
is still subsisting.
Petitioner filed a petition for review before this Court
assailing the Court of Appeals’ decision.
The Issue
The only issue in this case is whether the resolution of
the action for annulment of marriage is a prejudicial
question that warrants the suspension of the criminal
case for frustrated parricide against petitioner.
The Ruling of this Court
The petition has no merit.
Civil Case Must be Instituted Before the Criminal
Case
Section 7, Rule 111 of the 2000 Rules on Criminal
Procedure6 provides:
Section 7. Elements of Prejudicial Question. - The
elements of a prejudicial question are: (a) the
previously instituted civil action involves an issue
similar or intimately related to the issue raised in the
subsequent criminal action and (b) the resolution of
such issue determines whether or not the criminal
action may proceed.
The rule is clear that the civil action must be instituted
first before the filing of the criminal action. In this case,
the Information7 for Frustrated Parricide was dated 30
August 2004. It was raffled to RTC Quezon City on 25
October 2004 as per the stamped date of receipt on the
Information. The RTC Quezon City set Criminal Case
No. Q-04-130415 for pre-trial and trial on 14 February
2005. Petitioner was served summons in Civil Case
No. 04-7392 on 7 February 2005.8 Respondent’s
petition9 in Civil Case No. 04-7392 was dated 4
November 2004 and was filed on 5 November 2004.
Clearly, the civil case for annulment was filed after the
filing of the criminal case for frustrated parricide. As
such, the requirement of Section 7, Rule 111 of the
2000 Rules on Criminal Procedure was not met since
the civil action was filed subsequent to the filing of the
criminal action.
Annulment of Marriage is not a Prejudicial
Question in Criminal Case for Parricide
Further, the resolution of the civil action is not a
prejudicial question that would warrant the suspension
of the criminal action.
There is a prejudicial question when a civil action and
a criminal action are both pending, and there exists in
the civil action an issue which must be preemptively
resolved before the criminal action may proceed
because howsoever the issue raised in the civil action
is resolved would be determinative of the guilt or
innocence of the accused in the criminal case.10 A
prejudicial question is defined as:
x x x one that arises in a case the resolution of which
is a logical antecedent of the issue involved therein,
and the cognizance of which pertains to another
tribunal. It is a question based on a fact distinct and
separate from the crime but so intimately connected
with it that it determines the guilt or innocence of the
accused, and for it to suspend the criminal action, it
must appear not only that said case involves facts
intimately related to those upon which the criminal
prosecution would be based but also that in the
resolution of the issue or issues raised in the civil case,
the guilt or innocence of the accused would necessarily
be determined.11
The relationship between the offender and the victim is
a key element in the crime of parricide,12 which
punishes any person "who shall kill his father, mother,
or child, whether legitimate or illegitimate, or any of his
ascendants or descendants, or his spouse."13 The
relationship between the offender and the victim
distinguishes the crime of parricide from murder14 or
homicide.15 However, the issue in the annulment of
marriage is not similar or intimately related to the issue
in the criminal case for parricide. Further, the
relationship between the offender and the victim is not
determinative of the guilt or innocence of the accused.
The issue in the civil case for annulment of marriage
under Article 36 of the Family Code is whether
petitioner is psychologically incapacitated to comply
with the essential marital obligations. The issue in
parricide is whether the accused killed the victim. In this
case, since petitioner was charged with frustrated
parricide, the issue is whether he performed all the acts
of execution which would have killed respondent as a
consequence but which, nevertheless, did not produce
it by reason of causes independent of petitioner’s
will.16 At the time of the commission of the alleged
crime, petitioner and respondent were married. The
subsequent dissolution of their marriage, in case the
petition in Civil Case No. 04-7392 is granted, will have
no effect on the alleged crime that was committed at
the time of the subsistence of the marriage. In short,
even if the marriage between petitioner and
respondent is annulled, petitioner could still be held
criminally liable since at the time of the commission of
the alleged crime, he was still married to
respondent.1avvphi1
We cannot accept petitioner’s reliance on Tenebro v.
Court of Appeals17 that "the judicial declaration of the
nullity of a marriage on the ground of psychological
incapacity retroacts to the date of the celebration of the
marriage insofar as the vinculum between the spouses
is concerned x x x." First, the issue in Tenebro is the
effect of the judicial declaration of nullity of a second or
subsequent marriage on the ground of psychological
incapacity on a criminal liability for bigamy. There was
no issue of prejudicial question in that case. Second,
the Court ruled inTenebro that "[t]here is x x x a
recognition written into the law itself that such a
marriage, although void ab initio, may still produce
legal consequences."18 In fact, the Court declared in
that case that "a declaration of the nullity of the second
marriage on the ground of psychological incapacity is
of absolutely no moment insofar as the State’s penal
laws are concerned."19
In view of the foregoing, the Court upholds the decision
of the Court of Appeals. The trial in Criminal Case No.
Q-04-130415 may proceed as the resolution of the
issue in Civil Case No. 04-7392 is not determinative of
the guilt or innocence of petitioner in the criminal case.
WHEREFORE, we DENY the petition.
We AFFIRM the 20 March 2006 Decision of the Court
of Appeals in CA-G.R. SP No. 91867.
183
 2
SO ORDERED. Rollo, pp. 27-34. Penned by Associate Justice
Regalado E. Maambong with Associate Justices
ANTONIO T. CARPIO Rodrigo V. Cosico and Lucenito N. Tagle, concurring.
Associate Justice
3Id. at 50-51. Penned by Presiding Judge Ramon A.
WE CONCUR: Cruz.
DIOSDADO M. PERALTA 4 Id. at 51.
Associate Justice
5 Id. at 53.
LUCAS P. 6 Dated 1 December 2000.
ROBERTO A. ABAD
BERSAMIN*
Associate Justice 7
Associate Justice Rollo, p. 54.
8 Id. at 56.
MARTIN S. VILLARAMA, JR.**
Associate Justice 9 Id. at 61-65.
ATTESTATION 10
Jose v. Suarez, G.R. No. 176795, 30 June 2008, 556
SCRA 773.
I attest that the conclusions in the above Decision had
been reached in consultation before the case was 11Go v. Sandiganbayan, G.R. Nos. 150329-30, 11
assigned to the writer of the opinion of the Court’s September 2007, 532 SCRA 574, 577-578.
Division.
12 People v. Dalag, 450 Phil. 304 (2003).
ANTONIO T. CARPIO
13
Associate Justice Article 246 of the Revised Penal Code.
Chairperson 14 Article 248 of the Revised Penal Code.
CERTIFICATION 15 Article 249 of the Revised Penal Code.
Pursuant to Section 13, Article VIII of the Constitution, 16
and the Division Chairperson’s Attestation, I certify See Article 6 of the Revised Penal Code.
that the conclusions in the above Decision had been 17 467 Phil. 723 (2004).
reached in consultation before the case was assigned
to the writer of the opinion of the Court’s Division. 18 Id. at 744. Italicization in the original.
RENATO C. CORONA 19 Id. at 742.
Chief Justice

Footnotes
*Designated additional member per Special Order No.
886 dated 1 September 2010.
**
Designated additional member per Raffle dated 8
September 2010.
1 Under Rule 45 of the 1997 Rules of Civil Procedure.

184
 On appeal is the amended decision promulgated on
August 18, 2003,1 whereby the Court of Appeals (CA)
granted the writ of certiorari upon petition by the State
in C.A.-G.R. No. 71252 entitled People v. Han. Winlove
M Dumayas, Presiding Judge, Branch 59, Regional
Trial Court, Makati City and Rafael Consing, Jr., and
set aside the assailed order issued on November 26,
2001 by the Regional Trial Court (RTC), Branch 59, in
Makati City deferring the arraignment of petitioner in
Criminal Case No. 00-120 entitled People v. Rafael
Consing, Jr. upon his motion on the ground of the
existence of a prejudicial question in the civil cases
pending between him and the complainant in the trial
courts in Pasig City and Makati City.

Antecedents

Petitioner negotiated with and obtained for himself and

his mother, Cecilia de la Cruz (de la Cruz) various
loans totaling P18,000,000.00 from Unicapital Inc.
(Unicapital). The loans were secured by a real estate
mortgage constituted on a parcel of land (property)
covered by Transfer Certificate of Title (TCT) No. T-
687599 of the Registry of Deeds for the Province of
Cavite registered under the name of de la Cruz.2 In
Republic of the Philippines accordance with its option to purchase the mortgaged
SUPREME COURT property, Unicapital agreed to purchase one-half of the
Manila property for a total consideration of P21,221,500.00.
Payment was effected by off-setting the amounts due
FIRST DIVISION to

G.R. No. 161075 July 15, 2013
RAFAEL JOSE-CONSING, JR., Petitioner,
vs.
PEOPLE OF THE PHILIPPINES, Respondent.
DECISION
BERSAMIN, J.:
An independent civil action based on fraud initiated by
the defrauded party does not raise a prejudicial
question to stop the proceedings in a pending criminal
prosecution of the defendant for estafa through
falsification. This is because the result of the
independent civil action is irrelevant to the issue of guilt
or innocence of the accused.
The Case
Unicapital under the promissory notes of de la Cruz
and Consing in the amount of P18,000,000.00 and
paying an additional amount of P3,145,946.50. The
other half of the property was purchased by Plus
Builders, Inc. (Plus Builders), a joint venture partner of
Unicapital.3
Before Unicapital and Plus Builders could develop the
property, they learned that the title to the property was
really TCT No. 114708 in the names of Po Willie Yu
and Juanito Tan Teng, the parties from whom the
property had been allegedly acquired by de la Cruz.
TCT No. 687599 held by De la Cruz appeared to be
spurious.4
On its part, Unicapital demanded the return of the total
amount of P41,377,851.48 as of April 19, 1999 that
had been paid to and received by de la Cruz and
Consing, but the latter ignored the demands.5

185
On July 22, 1999, Consing filed Civil Case No. 1759 in
the Pasig City Regional Trial Court (RTC) (Pasig civil
case) for injunctive relief, thereby seeking to enjoin
Unicapital from proceeding against him for the
collection of theP41,377,851.48 on the ground that he
had acted as a mere agent of his mother.
On the same date, Unicapital initiated a criminal
complaint for estafa through falsification of public
document against Consing and de la Cruz in the Makati
City Prosecutor’s Office.6
On August 6, 1999, Unicapital sued Consing in the
RTC in Makati City (Civil Case No. 99-1418) for the
recovery of a sum of money and damages, with an
application for a writ of preliminary attachment (Makati
civil case).7
On January 27, 2000, the Office of the City Prosecutor
of Makati City filed against Consing and De la Cruz an
information for estafa through falsification of public
document in the RTC in Makati City (Criminal Case No.
00-120), which was assigned to Branch 60 (Makati
criminal case).8
On February 15, 2001, Consing moved to defer his
arraignment in the Makati criminal case on the ground
of existence of a prejudicial question due to the
pendency of the Pasig and Makati civil cases. On
September 25, 2001, Consing reiterated his motion for
deferment of his arraignment, citing the additional
ground of pendency of CA-G.R. SP No. 63712 in the
CA. On November 19, 2001, the Prosecution opposed
the motion.9
On November 26, 2001, the RTC issued an order
suspending the proceedings in the Makati criminal
case on the ground of the existence of a prejudicial
question, and on March 18, 2001, the RTC denied the
Prosecution’s motion for reconsideration.10
The State thus assailed in the CA the last two orders
of the RTC in the Makati criminal case via petition for
certiorari (C.A.-G.R. SP No. 71252).
On May 20, 2003, the CA promulgated its decision in
C.A.-G.R. SP No. 71252,11 dismissing the petition for
certiorari and upholding the RTC’s questioned orders,
explaining:
Is the resolution of the Pasig civil case prejudicial to the
Cavite and Makati criminal cases?
We hold that it is. The resolution of the issue in the
Pasig case, i.e. whether or not private respondent may
be held liable in the questioned transaction, will
determine the guilt or innocence of private respondent
Consing in both the Cavite and Makati criminal cases.
The analysis and comparison of the Pasig civil case,
Makati criminal case, Makati civil case and Cavite
criminal case show that: (1) the parties are identical;
(2) the transactions in controversy are identical; (3) the
Transfer Certificate of Titles (TCT) involved are
identical; (4) the questioned Deeds of Sale/Mortgage
are identical; (5) the dates in question are identical; and
(6) the issue of private respondent’s culpability for the
questioned transactions is identical in all the
proceedings.
As discussed earlier, not only was the issue raised in
the Pasig civil case identical to or intimately related to
the criminal cases in Cavite and Makati. The
similarities also extend to the parties in the cases and
the TCT and Deed of Sale/ Mortgage involved in the
questioned transactions.
The respondent Judge, in ordering the suspension of
the arraignment of private respondent in the Makati
case, in view of CA-G.R. SP No. 63712, where
Unicapital was not a party thereto, did so pursuant to
its mandatory power to take judicial notice of an official
act of another judicial authority. It was also a better
legal tack to prevent multiplicity of action, to which our
legal system abhors.
Applying the Tuanda ruling, the pendency of CA-G.R.
SP No. 63712 may be validly invoked to suspend
private respondent’s arraignment in the Makati City
criminal case, notwithstanding the fact that CA-G.R.
SP No. 63712 was an offshoot, merely, in the Cavite
criminal case.12
In the meanwhile, on October 13, 1999, Plus Builders
commenced its own suit for damages against Consing
(Civil Case No. 99-95381) in the RTC in Manila (Manila
civil case).13
On January 21, 2000, an information for estafa through
falsification of public document was filed against
Consing and De la Cruz in the RTC in Imus, Cavite,
docketed as Criminal Case No. 7668-00 and assigned
to Branch 21 (Cavite criminal case). Consing filed a
motion to defer the arraignment on the ground of the
existence of a prejudicial question, i.e., the pendency
of the Pasig and Manila civil cases. On January 27,
2000, however, the RTC handling the Cavite criminal
case denied Consing’s motion. Later on, it also denied
his motion for reconsideration. Thereafter, Consing
commenced in the CA a special civil action for certiorari
with prayer for the issuance of a temporary restraining
order (TRO) and/or writ of preliminary injunction (C.A.-
G.R. SP No. 63712), seeking to enjoin his arraignment
and trial in the Cavite criminal case. The CA granted
the TRO on March 19, 2001, and later promulgated its
decision on May 31, 2001, granting Consing’ petition
for certiorari and setting aside the January 27, 2000
order of the RTC, and permanently enjoining the RTC
from proceeding with the arraignment and trial until the
Pasig and Manila civil cases had been finally decided.
Not satisfied, the State assailed the decision of the CA
in this Court (G.R. No. 148193), praying for the reversal
of the May 31, 2001 decision of the CA. On January
16, 2003, the Court granted the petition for review in
G.R. No. 148193, and reversed and set aside the May
31, 2001 decision of the CA,14 viz:
In the case at bar, we find no prejudicial question that
would justify the suspension of the proceedings in the
criminal case (the Cavite criminal case). The issue in
Civil Case No. SCA 1759 (the Pasig civil case) for
Injunctive Relief is whether or not respondent
(Consing) merely acted as an agent of his mother,
Cecilia de la Cruz; while in Civil Case No. 99-95381
(the Manila civil case), for Damages and Attachment,
the question is whether respondent and his mother are
liable to pay damages and to return the amount paid by
PBI for the purchase of the disputed lot. Even if
respondent is declared merely an agent of his mother
in the transaction involving the sale of the questioned
lot, he cannot be adjudged free from criminal liability.
An agent or any person may be held liable for
conspiring to falsify public documents. Hence, the
determination of the issue involved in Civil Case No.
SCA 1759 for Injunctive Relief is irrelevant to the guilt
or innocence of the respondent in the criminal case for
estafa through falsification of public document.
Likewise, the resolution of PBI’s right to be paid
damages and the purchase price of the lot in question
186
will not be determinative of the culpability of the
respondent in the criminal case for even if PBI is held
entitled to the return of the purchase price plus
damages, it does not ipso facto follow that respondent
should be held guilty of estafa through falsification of
public document. Stated differently, a ruling of the court
in the civil case that PBI should not be paid the
purchase price plus damages will not necessarily
absolve respondent of liability in the criminal case
where his guilt may still be established under penal
laws as determined by other evidence.
Moreover, neither is there a prejudicial question if the
civil and the criminal action can, according to law,
proceed independently of each other. Under Rule 111,
Section 3 of the Revised Rules on Criminal Procedure,
in the cases provided in Articles 32, 33, 34 and 2176 of
the Civil Code, the independent civil action may be
brought by the offended party. It shall proceed
independently of the criminal action and shall require
only a preponderance of evidence. In no case,
however, may the offended party recover damages
twice for the same act or omission charged in the
criminal action.
Thus, in Rojas v. People, the petitioner was accused in
a criminal case for violation of Article 319 of the
Revised Penal Code, for executing a new chattel
mortgage on personal property in favor of another party
without consent of the previous mortgagee. Thereafter,
the offended party filed a civil case for termination of
management contract, one of the causes of action of
which consisted of petitioner having executed a chattel
mortgage while the previous chattel mortgage was still
valid and subsisting. Petitioner moved that the
arraignment and trial of the criminal case be held in
abeyance on the ground that the civil case was a
prejudicial question, the resolution of which was
necessary before the criminal proceedings could
proceed. The trial court denied the suspension of the
criminal case on the ground that no prejudicial question
exist. We affirmed the order of the trial court and ruled
that:
… the resolution of the liability of the defendant in the
civil case on the eleventh cause of action based on the
fraudulent misrepresentation that the chattel mortgage
the defendant executed in favor of the said CMS
Estate, Inc. on February 20, 1957, that his D-6
"Caterpillar" Tractor with Serial No. 9-U-6565 was "free
from all liens and encumbrances" will not determine the
criminal liability of the accused in the said Criminal
Case No. 56042 for violation of paragraph 2 of Article
319 of the Revised Penal Code. . . . (i) That, even
granting for the sake of argument, a prejudicial
question is involved in this case, the fact remains that
both the crime charged in the information in the criminal
case and the eleventh cause of action in the civil case
are based upon fraud, hence both the civil and criminal
cases could proceed independently of the other
pursuant to Article 33 of the new Civil Code which
provides: "In cases of defamation, fraud and physical
injuries, a civil action for damages, entirely separate
and distinct from the criminal action shall proceed
independently of the criminal prosecution, and shall
require only a preponderance of evidence." (j) That,
therefore, the act of respondent judge in issuing the
orders referred to in the instant petition was not made
with "grave abuse of discretion."
In the instant case, Civil Case No. 99-95381, for
Damages and Attachment on account of the alleged
fraud committed by respondent and his mother in
selling the disputed lot to PBI is an independent civil
action under Article 33 of the Civil Code. As such, it will
not operate as a prejudicial question that will justify the
suspension of the criminal case at bar.15
Turning back to the Makati criminal case, the State
moved for the reconsideration of the adverse decision
of the CA, citing the ruling in G.R. No. 148193, supra,
to the effect that the Pasig and Manila civil cases did
not present a prejudicial question that justified the
suspension of the proceedings in the Cavite criminal
case, and claiming that under the ruling in G.R. No.
148193, the Pasig and Makati civil cases did not raise
a prejudicial question that would cause the suspension
of the Makati criminal case.
In his opposition to the State’s motion for
reconsideration, Consing contended that the ruling in
G.R. No. 148193 was not binding because G.R. No.
148193 involved Plus Builders, which was different
from Unicapital, the complainant in the Makati criminal
case. He added that the decision in G.R. No. 148193
did not yet become final and executory, and could still
be reversed at any time, and thus should not control as
a precedent to be relied upon; and that he had acted
as an innocent attorney-in-fact for his mother, and
should not be held personally liable under a contract
that had involved property belonging to his mother as
his principal.
On August 18, 2003, the CA amended its decision,
reversing itself. It relied upon the ruling in G.R. No.
148193, and held thusly:
CA-G.R. SP No. 63712 is similar with the case at
bench. The transactions in controversy, the documents
involved; the issue of the respondent’s culpability for
the questioned transactions are all identical in all the
proceedings; and it deals with the same parties with the
exception of private complainant Unicapital.
However, the Supreme Court, upon review of CA-G.R.
SP No. 63712, People of the Philippines vs. Rafael
Jose Consing, Jr. (G.R. No. 148193, January 16, 2003)
held that "Civil Case No. 99-95381, for Damages and
attachment on account of alleged fraud committed by
respondent and his mother in selling the disputed lot to
Plus Builders, Inc. is an independent civil action under
Article 33 of the Civil Code. As such, it will not operate
as a prejudicial question that will justify the suspension
of the criminal case at bar." In view of the
aforementioned decision of the Supreme Court, We
are thus amending Our May 20, 2003 decision.
WHEREFORE, the petitioner’s motion for
reconsideration is GRANTED. The Orders dated
November 26, 2001 and March 18, 2002 issued by the
respondent Judge are hereby REVERSED and SET
ASIDE. Respondent Judge is hereby ordered to
proceed with the hearing of Criminal Case No. 00-120
with dispatch.
SO ORDERED.16
Consing filed a motion for reconsideration,17 but the CA
denied the motion through the second assailed
resolution of December 11, 2003.18
Hence, this appeal by petition for review on certiorari.
Issue
Petitioner reiterates his contention that the decision in
G.R. No. 148193 was not controlling in relation to C.A.-
G.R. No. 71252, which involved Plus Builders, not
Unicapital, the complainant in Criminal Case No. 00-
120. He posits that in arriving at its amended decision,
the CA did not consider the pendency of the Makati civil
187
case (Civil Case No. 99-1418), which raised a
prejudicial question, considering that the resolution of
such civil action would include the issue of whether he
had falsified a certificate of title or had willfully
defrauded Unicapital, the resolution of either of which
would determine his guilt or innocence in Criminal
Case No. 00-120.
In its comment,19 the Office of the Solicitor General
(OSG) counters that Unicapital brought the Makati civil
case as an independent civil action intended to exact
civil liability separately from Criminal Case No. 00-120
in a manner fully authorized under Section 1(a) and
Section 2, Rule 111 of the Rules of Court.20 It argues
that the CA correctly took cognizance of the ruling in
G.R. No. 148193, holding in its challenged amended
decision that the Makati civil case, just like the Manila
civil case, was an independent civil action instituted by
virtue of Article 33 of the Civil Code; that the Makati civil
case did not raise a prejudicial question that justified
the suspension of Criminal Case No. 00-120; and that
as finally settled in G.R. No. 148193, the Pasig civil
case did not also raise any prejudicial question,
because the sole issue thereat was whether Consing,
as the mere agent of his mother, had any obligation or
liability toward Unicapital.
In his reply,21 Consing submits that the Pasig civil case
that he filed and Unicapital’s Makati civil case were not
intended to delay the resolution of Criminal Case No.
00-120, nor to pre-empt such resolution; and that such
civil cases could be validly considered determinative of
whether a prejudicial question existed to warrant the
suspension of Criminal Case No. 00-120.
Did the CA err in reversing itself on the issue of the
existence of a prejudicial question that warranted the
suspension of the proceedings in the Makati criminal
case?
Ruling
The petition for review on certiorari is absolutely
meritless.
Consing has hereby deliberately chosen to ignore the
firm holding in the ruling in G.R. No. 148193 to the
effect that the proceedings in Criminal Case No. 00-
120 could not be suspended because the Makati civil
case was an independent civil action, while the Pasig
civil case raised no prejudicial question. That was
wrong for him to do considering that the ruling fully
applied to him due to the similarity between his case
with Plus Builders and his case with Unicapital.
A perusal of Unicapital’s complaint in the Makati civil
case reveals that the action was predicated on fraud.
This was apparent from the allegations of Unicapital in
its complaint to the effect that Consing and de la Cruz
had acted in a "wanton, fraudulent, oppressive, or
malevolent manner in offering as security and later
object of sale, a property which they do not own, and
foisting to the public a spurious title."22 As such, the
action was one that could proceed independently of
Criminal Case No. 00-120 pursuant to Article 33 of the
Civil Code, which states as follows:
Article 33. In cases of defamation, fraud, and physical
injuries a civil action for damages, entirely separate
and distinct from the criminal action, may be brought
by the injured party. Such civil action shall proceed
independently of the criminal prosecution, and shall
require only a preponderance of evidence.
It is well settled that a civil action based on defamation,
fraud and physical injuries may be independently
instituted pursuant to Article 33 of the Civil Code, and
does not operate as a prejudicial question that will
justify the suspension of a criminal case. 23 This was
precisely the Court’s thrust in G.R. No. 148193, thus:
Moreover, neither is there a prejudicial question if the
civil and the criminal action can, according to law,
proceed independently of each other. Under Rule 111,
Section 3 of the Revised Rules on Criminal Procedure,
in the cases provided in Articles 32, 33, 34 and 2176 of
the Civil Code, the independent civil action may be
brought by the offended party. It shall proceed
independently of the criminal action and shall require
only a preponderance of evidence. In no case,
however, may the offended party recover damages
twice for the same act or omission charged in the
criminal action.
xxxx
In the instant case, Civil Case No. 99-95381, for
Damages and Attachment on account of the alleged
fraud committed by respondent and his mother in
selling the disputed lot to PBI is an independent civil
action under Article 33 of the Civil Code. As such, it will
not operate as a prejudicial question that will justify the
suspension of the criminal case at bar.24
Contrary to Consing’s stance, it was not improper for
the CA to apply the ruling in G.R. No. 148193 to his
case with Unicapital, for, although the Manila and
Makati civil cases involved different complainants (i.e.,
Plus Builders and Unicapital), the civil actions Plus
Builders and Unicapital had separately instituted
against him were undeniably of similar mold, i.e., they
were both based on fraud, and were thus covered by
Article 33 of the Civil Code. Clearly, the Makati criminal
case could not be suspended pending the resolution of
the Makati civil case that Unicapital had filed.
As far as the Pasig civil case is concerned, the issue of
Consing’s being a mere agent of his mother who
should not be criminally liable for having so acted due
to the property involved having belonged to his mother
as principal has also been settled in G.R. No. 148193,
to wit:
In the case at bar, we find no prejudicial question that
would justify the suspension of the proceedings in the
criminal case (the Cavite criminal case). The issue in
Civil Case No. SCA 1759 (the Pasig civil case) for
Injunctive Relief is whether or not respondent
(Consing) merely acted as an agent of his mother,
Cecilia de la Cruz; while in Civil Case No. 99-95381
(the Manila civil case), for Damages and Attachment,
the question is whether respondent and his mother are
liable to pay damages and to return the amount paid by
PBI for the purchase of the disputed lot. Even if
respondent is declared merely an agent of his mother
in the transaction involving the sale of the questioned
lot, he cannot be adjudged free from criminal liability.
An agent or any person may be held liable for
conspiring to falsify public documents. Hence, the
determination of the issue involved in Civil Case No.
SCA 1759 for Injunctive Relief is irrelevant to the guilt
or innocence of the respondent in the criminal case for
estafa through falsification of public
document.25 (Words in parentheses supplied; bold
underscoring supplied for emphasis)
WHEREFORE, the Court AFFIRMS the amended
decision promulgated on August 18, 2003; and
ORDERS petitioner to pay the costs of suit.
188
 8
SO ORDERED. Id. at 58-59. Except as otherwise provided in these Rules, no filing
fees shall be required for actual damages.
LUCAS P. BERSAMIN 9 Id. at 59.
Associate Justice No counterclaim, cross-claim or third-party complaint
10 Id. may be filed by the accused in the criminal case, but
WE CONCUR: any cause of action which could have been the subject
11 Id. at 57-63.
thereof may be litigated in a separate civil action.
12
Chief Justice Id. at 61-62.
xxxx
13
TERESITA J. Raffled to Branch 12.
MARTIN S. Sec. 2. When separate civil action is suspended. –
LEONARDO-DE 14 After the criminal action has been commenced, the
VILLARAMA, JR. People v. Consing, Jr., G.R. No. 148193, January
CASTRO separate civil action arising therefrom cannot be
Associate Justice 16, 2003, 395 SCRA 366, 370-372.
Associate Justice instituted until final judgment has been entered in the
15The ruling in G.R. No. 148193 became final and criminal action.
BIENVENIDO L. REYES executory.
Associate Justice If the criminal action is filed after the said civil action
16 has already been instituted, the latter shall be
Rollo, pp. 34-35.
CERTIFICATION suspended in whatever state it may be found before
17 Id. at 39-55. judgment on the merits. The suspension shall last until
Pursuant to Section 13, Article VIII of the Constitution,
final judgment is rendered in the criminal action.
I certify that the conclusions in the above Decision 18 Id. at 37-38. Nevertheless, before judgment on the merits rendered
had been reached in consultation before the case was
19 Id. at 104-117. in the civil action, the same may, upon motion of the
assigned to the writer of the opinion of the Court's
offended party, be consolidated with the criminal action
Division.
20 Section 1. Institution of criminal and civil actions. – in the court trying the criminal action. In case of
MARIA LOURDES P. A. SERENO (a) When a criminal action is instituted, the civil action consolidation, the evidence already adduced in the civil
Chief Justice for the recovery of civil liability arising from the offense action shall be deemed automatically reproduced in the
charged shall be deemed instituted with the criminal criminal action without prejudice to the right of the
action unless the offended party waives the civil action, prosecution to cross-examine the witness presented by
reserves the right to institute it separately or institutes the offended party in the criminal case and of the
the civil action prior to the criminal action. parties to present additional evidence. The
Footnotes consolidated criminal and civil actions shall be tried
1
The reservation of the right to institute separately the and decided jointly.
Rollo, pp. 34-35; penned by Associate Justice Eliezer civil action shall be made before the prosecution starts
R. de los Santos retired/deceased), with the presenting its evidence and under circumstances During the pendency of the criminal action, the running
concurrence of Associate Justice Romeo A. Brawner affording the offended party a reasonable opportunity period of prescription of the civil action which cannot
(later Presiding Justice, but already. retired and now to make such reservation. be instituted separately or whose proceeding has been
deceased) and Associate Justice Regalado E. suspended shall be tolled.
Maambong (retired/deceased). When the offended party seeks to enforce civil liability
against the accused by way of moral, nominal, The extinction of the penal action does not carry with it
2 Id. at 57-58. temperate, or exemplary damages without specifying extinction of the civil action. However, the civil action
3 the amount thereof in the complaint or information, the based on delict shall be deemed extinguished if there
Id. at 58.
filing fees therefore shall constitute a first lien on the is a finding in a final judgment in the criminal action that
4 Id. judgment awarding such damages. the act or omission from which the civil liability may
arise did not exist.
5 Id. Where the amount of damages, other than actual, is
21
specified in the complaint or information, the Rollo, pp. 120-126.
6 Id. corresponding filing fees shall be paid by the offended 22
party upon the filing thereof in court. Rollo, p. 83.
7 Id. at 77-88.

189
23Samson v. Daway, G.R. Nos. 160054-55, July 21,
2004, 434 SCRA 612, 620-621; Rojas v. People, No.
L-22237, May 31, 1974, 57 SCRA 243, 246.
24 Supra note 14, at 371-372.
25 Id. at 370-371.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 26795 July 31, 1970
CARMEN QUIMIGUING, Suing through her
parents, ANTONIO QUIMIGUING and JACOBA
CABILIN,plaintiffs-appellants,
vs.
FELIX ICAO, defendant-appellee.
Torcuato L. Galon for plaintiffs-appellants.
Godardo Jacinto for defendant-appellee.
REYES, J.B.L., J.:
Appeal on points of law from an order of the Court of
First Instance of Zamboanga del Norte (Judge Onofre
Sison Abalos, presiding), in its Civil Case No. 1590,
dismissing a complaint for support and damages, and
another order denying amendment of the same
pleading.
The events in the court of origin can be summarized as
follows:
Appellant, Carmen Quimiguing, assisted by her
parents, sued Felix Icao in the court below. In her
complaint it was averred that the parties were
neighbors in Dapitan City, and had close and
confidential relations; that defendant Icao, although
married, succeeded in having carnal intercourse with
plaintiff several times by force and intimidation, and
without her consent; that as a result she became
pregnant, despite efforts and drugs supplied by
defendant, and plaintiff had to stop studying. Hence,
she claimed support at P120.00 per month, damages
and attorney's fees.
Duly summoned, defendant Icao moved to dismiss for
lack of cause of action since the complaint did not
allege that the child had been born; and after hearing
arguments, the trial judge sustained defendant's
motion and dismissed the complaint.
Thereafter, plaintiff moved to amend the complaint to
allege that as a result of the intercourse, plaintiff had
later given birth to a baby girl; but the court, sustaining
defendant's objection, ruled that no amendment was
allowable, since the original complaint averred no
cause of action. Wherefore, the plaintiff appealed
directly to this Court.
We find the appealed orders of the court below to be
untenable. A conceived child, although as yet unborn,
is given by law a provisional personality of its own for
all purposes favorable to it, as explicitly provided in
Article 40 of the Civil Code of the Philippines. The
unborn child, therefore, has a right to support from its
progenitors, particularly of the defendant-appellee
(whose paternity is deemed admitted for the purpose
of the motion to dismiss), even if the said child is only
"en ventre de sa mere;" just as a conceived child, even
if as yet unborn, may receive donations as prescribed
by Article 742 of the same Code, and its being ignored
by the parent in his testament may result in preterition
of a forced heir that annuls the institution of the
testamentary heir, even if such child should be born
after the death of the testator Article 854, Civil Code).
ART. 742. Donations made to conceived and unborn
children may be accepted by those persons who would
legally represent them if they were already born.
190
ART. 854. The preterition or omission of one, some, or
all of the compulsory heirs in the direct line, whether
living at the time of the execution of the will or born after
the death of the testator, shall annul the institution of
heir; but the devises and legacies shall be valid insofar
as they are not inofficious.
If the omitted compulsory heirs should die before the
testator, the institution shall be effectual, without
prejudice to the right of 'representation.
ART. 21. Any person who wilfully causes loss or injury
to another in a manner that is contrary to morals, good
customs or public policy shall compensate the latter for
the damage.
The rule of Article 21 is supported by Article 2219 of
the same Code:
ART 2219. Moral damages may be recovered in the
following and analogous cases:

It is thus clear that the lower court's theory that Article (3) Seduction, abduction, rape or other lascivious acts:
291 of the Civil Code declaring that support is an
xxx xxx xxx
obligation of parents and illegitimate children "does not
contemplate support to children as yet unborn," (10) Acts and actions referred to in Articles 21, 26, 27,
violates Article 40 aforesaid, besides imposing a 28 ....
condition that nowhere appears in the text of Article
291. It is true that Article 40 prescribing that "the Thus, independently of the right to Support of the child
conceived child shall be considered born for all she was carrying, plaintiff herself had a cause of action
purposes that are favorable to it" adds further "provided for damages under the terms of the complaint; and the
it be born later with the conditions specified in the order dismissing it for failure to state a cause of action
following article" (i.e., that the foetus be alive at the was doubly in error.
time it is completely delivered from the mother's
womb). This proviso, however, is not a condition WHEREFORE, the orders under appeal are reversed
precedent to the right of the conceived child; for if it and set aside. Let the case be remanded to the court
were, the first part of Article 40 would become entirely of origin for further proceedings conformable to this
useless and ineffective. Manresa, in his Commentaries decision. Costs against appellee Felix Icao. So
(5th Ed.) to the corresponding Article 29 of the Spanish ordered.
Civil Code, clearly points this out:
Concepcion, C.J., Dizon, Makalintal, Zaldivar, Castro,
Los derechos atribuidos al nasciturus no son Fernando, Teehankee, Barredo and Villamor, JJ.,
simples expectativas, ni aun en el sentido tecnico que concur.
la moderna doctrina da a esta figura juridica sino que
constituyen un caso de los propiamente Ilamados
'derechos en estado de pendenci'; el nacimiento del
sujeto en las condiciones previstas por el art. 30, no
determina el nacimiento de aquellos derechos (que ya
existian de antemano), sino que se trata de un hecho
que tiene efectos declarativos. (1 Manresa, Op. cit.,
page 271)

A second reason for reversing the orders appealed

from is that for a married man to force a woman not his
wife to yield to his lust (as averred in the original
complaint in this case) constitutes a clear violation of
the rights of his victim that entitles her to claim
compensation for the damage caused. Says Article 21
of the Civil Code of the Philippines:

191
 vs.
HON. ACCREDITED VOLUNTARY ARBITRATOR
ALLAN S. MONTAÑO and NAGKAKAISANG
MANGGAGAWA NG CENTRO STEEL
CORPORATION-SOLIDARITY OF UNIONS IN THE
PHILIPPINES FOR EMPOWERMENT AND
REFORMS (NMCSC-SUPER), Respondents.

DECISION

CHICO-NAZARIO, J.:

Before Us is a Petition for Review on Certiorari, under

Rule 45 of the Rules of Court, assailing the
Decision1 dated 27 February 2008 and the
Resolution2 dated 9 May 2008 of the Court of Appeals
in CA-G.R. SP No. 101697, affirming the
Resolution3 dated 20 November 2007 of respondent
Accredited Voluntary Arbitrator Atty. Allan S. Montaño
(Montaño) granting bereavement leave and other
death benefits to Rolando P. Hortillano (Hortillano),
grounded on the death of his unborn child.

The antecedent facts of the case are as follows:

Hortillano, an employee of petitioner Continental Steel

Manufacturing Corporation (Continental Steel) and a
member of respondent Nagkakaisang Manggagawa
ng Centro Steel Corporation-Solidarity of Trade Unions
in the Philippines for Empowerment and Reforms
(Union) filed on 9 January 2006, a claim for Paternity
Leave, Bereavement Leave and Death and Accident
Insurance for dependent, pursuant to the Collective
Bargaining Agreement (CBA) concluded between
Continental and the Union, which reads:

ARTICLE X: LEAVE OF ABSENCE

xxxx

Section 2. BEREAVEMENT LEAVE—The Company

Republic of the Philippines agrees to grant a bereavement leave with pay to any
SUPREME COURT employee in case of death of the employee’s legitimate
Manila dependent (parents, spouse, children, brothers and
sisters) based on the following:
THIRD DIVISION
2.1 Within Metro Manila up to Marilao, Bulacan - 7 days
G.R. No. 182836 October 13, 2009
2.2 Provincial/Outside Metro Manila - 11 days
CONTINENTAL STEEL MANUFACTURING
CORPORATION, Petitioner, xxxx

192
ARTICLE XVIII: OTHER BENEFITS
xxxx
Section 4. DEATH AND ACCIDENT INSURANCE—
The Company shall grant death and accidental
insurance to the employee or his family in the following
manner:
xxxx
4.3 DEPENDENTS—Eleven Thousand Five Hundred
Fifty Pesos (Php11,550.00) in case of death of the
employees legitimate dependents (parents, spouse,
and children). In case the employee is single, this
benefit covers the legitimate parents, brothers and
sisters only with proper legal document to be presented
(e.g. death certificate).4
The claim was based on the death of Hortillano’s
unborn child. Hortillano’s wife, Marife V. Hortillano, had
a premature delivery on 5 January 2006 while she was
in the 38th week of pregnancy.5 According to the
Certificate of Fetal Death dated 7 January 2006, the
female fetus died during labor due to fetal Anoxia
secondary to uteroplacental insufficiency.6
Continental Steel immediately granted Hortillano’s
claim for paternity leave but denied his claims for
bereavement leave and other death benefits,
consisting of the death and accident insurance.7
Seeking the reversal of the denial by Continental Steel
of Hortillano’s claims for bereavement and other death
benefits, the Union resorted to the grievance
machinery provided in the CBA. Despite the series of
conferences held, the parties still failed to settle their
dispute,8 prompting the Union to file a Notice to
Arbitrate before the National Conciliation and
Mediation Board (NCMB) of the Department of Labor
and Employment (DOLE), National Capital Region
(NCR).9 In a Submission Agreement dated 9 October
2006, the Union and Continental Steel submitted for
voluntary arbitration the sole issue of whether
Hortillano was entitled to bereavement leave and other
death benefits pursuant to Article X, Section 2
and Article XVIII, Section 4.3 of the CBA.10 The parties
mutually chose Atty. Montaño, an Accredited Voluntary
Arbitrator, to resolve said issue.11
When the preliminary conferences again proved futile
in amicably settling the dispute, the parties proceeded
to submit their respective Position
Papers, 12 Replies,13 and Rejoinders14 to Atty.
Montaño.
The Union argued that Hortillano was entitled to
bereavement leave and other death benefits pursuant
to the CBA. The Union maintained that Article X,
Section 2 and Article XVIII, Section 4.3 of the CBA did
not specifically state that the dependent should have
first been born alive or must have acquired juridical
personality so that his/her subsequent death could be
covered by the CBA death benefits. The Union cited
cases wherein employees of MKK Steel Corporation
(MKK Steel) and Mayer Steel Pipe Corporation (Mayer
Steel), sister companies of Continental Steel, in similar
situations as Hortillano were able to receive death
benefits under similar provisions of their CBAs.
The Union mentioned in particular the case of Steve L.
Dugan (Dugan), an employee of Mayer Steel, whose
wife also prematurely delivered a fetus, which had
already died prior to the delivery. Dugan was able to
receive paternity leave, bereavement leave, and
voluntary contribution under the CBA between his
union and Mayer Steel.15 Dugan’s child was only 24
weeks in the womb and died before labor, as opposed
to Hortillano’s child who was already 37-38 weeks in
the womb and only died during labor.
The Union called attention to the fact that MKK Steel
and Mayer Steel are located in the same compound as
Continental Steel; and the representatives of MKK
Steel and Mayer Steel who signed the CBA with their
respective employees’ unions were the same as the
representatives of Continental Steel who signed the
existing CBA with the Union.
Finally, the Union invoked Article 1702 of the Civil
Code, which provides that all doubts in labor
legislations and labor contracts shall be construed in
favor of the safety of and decent living for the laborer.
On the other hand, Continental Steel posited that the
express provision of the CBA did not contemplate the
death of an unborn child, a fetus, without legal
personality. It claimed that there are two elements for
the entitlement to the benefits, namely: (1) death and
(2) status as legitimate dependent, none of which
existed in Hortillano’s case. Continental Steel, relying
on Articles 40, 41 and 4216 of the Civil Code,
contended that only one with civil personality could die.
Hence, the unborn child never died because it never
acquired juridical personality. Proceeding from the
same line of thought, Continental Steel reasoned that
a fetus that was dead from the moment of delivery was
not a person at all. Hence, the term dependent could
not be applied to a fetus that never acquired juridical
personality. A fetus that was delivered dead could not
be considered a dependent, since it never needed any
support, nor did it ever acquire the right to be
supported.
Continental Steel maintained that the wording of the
CBA was clear and unambiguous. Since neither of the
parties qualified the terms used in the CBA, the legally
accepted definitions thereof were deemed
automatically accepted by both parties. The failure of
the Union to have unborn child included in the definition
of dependent, as used in the CBA – the death of whom
would have qualified the parent-employee for
bereavement leave and other death benefits – bound
the Union to the legally accepted definition of the latter
term.
Continental Steel, lastly, averred that similar cases
involving the employees of its sister companies, MKK
Steel and Mayer Steel, referred to by the Union, were
irrelevant and incompetent evidence, given the
separate and distinct personalities of the companies.
Neither could the Union sustain its claim that the grant
of bereavement leave and other death benefits to the
parent-employee for the loss of an unborn child
constituted "company practice."
On 20 November 2007, Atty. Montaño, the appointed
Accredited Voluntary Arbitrator, issued a
Resolution17 ruling that Hortillano was entitled to
bereavement leave with pay and death benefits.
Atty. Montaño identified the elements for entitlement to
said benefits, thus:
This Office declares that for the entitlement of the
benefit of bereavement leave with pay by the covered
employees as provided under Article X, Section 2 of
the parties’ CBA, three (3) indispensable elements
must be present: (1) there is "death"; (2) such death
193
must be of employee’s "dependent"; and (3) such
dependent must be "legitimate".
On the otherhand, for the entitlement to benefit for
death and accident insurance as provided under Article
XVIII, Section 4, paragraph (4.3) of the parties’ CBA,
four (4) indispensable elements must be present: (a)
there is "death"; (b) such death must be of employee’s
"dependent"; (c) such dependent must be "legitimate";
and (d) proper legal document to be presented.18
Atty. Montaño found that there was no dispute that the
death of an employee’s legitimate dependent occurred.
The fetus had the right to be supported by the parents
from the very moment he/she was conceived. The
fetus had to rely on another for support; he/she could
not have existed or sustained himself/herself without
the power or aid of someone else, specifically, his/her
mother. Therefore, the fetus was already a dependent,
although he/she died during the labor or delivery.
There was also no question that Hortillano and his wife
were lawfully married, making their dependent, unborn
child, legitimate.
In the end, Atty. Montaño decreed:
WHEREFORE, premises considered, a resolution is
hereby rendered ORDERING [herein petitioner
Continental Steel] to pay Rolando P. Hortillano the
amount of Four Thousand Nine Hundred Thirty-Nine
Pesos (P4,939.00), representing his bereavement
leave pay and the amount of Eleven Thousand Five
Hundred Fifty Pesos (P11,550.00) representing death
benefits, or a total amount of P16,489.00
The complaint against Manuel Sy, however, is
ORDERED DISMISSED for lack of merit.
All other claims are DISMISSED for lack of merit.
Further, parties are hereby ORDERED to faithfully
abide with the herein dispositions.
Aggrieved, Continental Steel filed with the Court of
Appeals a Petition for Review on Certiorari,19 under
Section 1, Rule 43 of the Rules of Court, docketed as
CA-G.R. SP No. 101697.
Continental Steel claimed that Atty. Montaño erred in
granting Hortillano’s claims for bereavement leave with
pay and other death benefits because no death of an
employee’s dependent had occurred. The death of a
fetus, at whatever stage of pregnancy, was excluded
from the coverage of the CBA since what was
contemplated by the CBA was the death of a legal
person, and not that of a fetus, which did not acquire
any juridical personality. Continental Steel pointed out
that its contention was bolstered by the fact that the
term death was qualified by the phrase legitimate
dependent. It asserted that the status of a child could
only be determined upon said child’s birth, otherwise,
no such appellation can be had. Hence, the conditions
sine qua non for Hortillano’s entitlement to
bereavement leave and other death benefits under the
CBA were lacking.
The Court of Appeals, in its Decision dated 27 February
2008, affirmed Atty. Montaño’s Resolution dated 20
November 2007. The appellate court interpreted death
to mean as follows:
[Herein petitioner Continental Steel’s] exposition on the
legal sense in which the term "death" is used in the
CBA fails to impress the Court, and the same is
irrelevant for ascertaining the purpose, which the grant
of bereavement leave and death benefits thereunder,
is intended to serve. While there is no arguing with
[Continental Steel] that the acquisition of civil
personality of a child or fetus is conditioned on being
born alive upon delivery, it does not follow that such
event of premature delivery of a fetus could never be
contemplated as a "death" as to be covered by the CBA
provision, undoubtedly an event causing loss and grief
to the affected employee, with whom the dead fetus
stands in a legitimate relation. [Continental Steel] has
proposed a narrow and technical significance to the
term "death of a legitimate dependent" as condition for
granting bereavement leave and death benefits under
the CBA. Following [Continental Steel’s] theory, there
can be no experience of "death" to speak of. The Court,
however, does not share this view. A dead fetus simply
cannot be equated with anything less than "loss of
human life", especially for the expectant parents. In this
light, bereavement leave and death benefits are meant
to assuage the employee and the latter’s immediate
family, extend to them solace and support, rather than
an act conferring legal status or personality upon the
unborn child. [Continental Steel’s] insistence that the
certificate of fetal death is for statistical purposes only
sadly misses this crucial point.20
Accordingly, the fallo of the 27 February 2008 Decision
of the Court of Appeals reads:
WHEREFORE, premises considered, the present
petition is hereby DENIED for lack of merit. The
assailed Resolution dated November 20, 2007 of
Accredited Voluntary Arbitrator Atty. Allan S. Montaño
is hereby AFFIRMED and UPHELD.
With costs against [herein petitioner Continental
Steel].21
In a Resolution22 dated 9 May 2008, the Court of
Appeals denied the Motion for Reconsideration23 of
Continental Steel.
Hence, this Petition, in which Continental Steel
persistently argues that the CBA is clear and
unambiguous, so that the literal and legal meaning of
death should be applied. Only one with juridical
personality can die and a dead fetus never acquired a
juridical personality.
We are not persuaded.
As Atty. Montaño identified, the elements for
bereavement leave under Article X, Section 2 of the
CBA are: (1) death; (2) the death must be of a
dependent, i.e., parent, spouse, child, brother, or
sister, of an employee; and (3) legitimate relations of
the dependent to the employee. The requisites for
death and accident insurance under Article XVIII,
Section 4(3) of the CBA are: (1) death; (2) the death
must be of a dependent, who could be a parent,
spouse, or child of a married employee; or a parent,
brother, or sister of a single employee; and (4)
presentation of the proper legal document to prove
such death, e.g., death certificate.
It is worthy to note that despite the repeated assertion
of Continental Steel that the provisions of the CBA are
clear and unambiguous, its fundamental argument for
denying Hortillano’s claim for bereavement leave and
other death benefits rests on the purportedly proper
interpretation of the terms "death" and "dependent" as
used in the CBA. If the provisions of the CBA are
indeed clear and unambiguous, then there is no need
to resort to the interpretation or construction of the
same. Moreover, Continental Steel itself admitted that
neither management nor the Union sought to define the
194
pertinent terms for bereavement leave and other death
benefits during the negotiation of the CBA.
The reliance of Continental Steel on Articles 40, 41 and
42 of the Civil Code for the legal definition of death is
misplaced. Article 40 provides that a conceived child
acquires personality only when it is born, and Article 41
defines when a child is considered born. Article 42
plainly states that civil personality is extinguished by
death.
First, the issue of civil personality is not relevant herein.
Articles 40, 41 and 42 of the Civil Code on natural
persons, must be applied in relation to Article 37 of the
same Code, the very first of the general provisions on
civil personality, which reads:
Art. 37. Juridical capacity, which is the fitness to be the
subject of legal relations, is inherent in every natural
person and is lost only through death. Capacity to act,
which is the power to do acts with legal effect, is
acquired and may be lost.
We need not establish civil personality of the unborn
child herein since his/her juridical capacity and
capacity to act as a person are not in issue. It is not a
question before us whether the unborn child acquired
any rights or incurred any obligations prior to his/her
death that were passed on to or assumed by the child’s
parents. The rights to bereavement leave and other
death benefits in the instant case pertain directly to the
parents of the unborn child upon the latter’s death.
Second, Sections 40, 41 and 42 of the Civil Code do
not provide at all a definition of death. Moreover, while
the Civil Code expressly provides that civil personality
may be extinguished by death, it does not explicitly
state that only those who have acquired juridical
personality could die.
And third, death has been defined as the cessation of
life.24 Life is not synonymous with civil personality. One
need not acquire civil personality first before he/she
could die. Even a child inside the womb already has
life. No less than the Constitution recognizes the life of
the unborn from conception,25 that the State must
protect equally with the life of the mother. If the unborn
already has life, then the cessation thereof even prior
to the child being delivered, qualifies as death.
Likewise, the unborn child can be considered a
dependent under the CBA. As Continental Steel itself
defines, a dependent is "one who relies on another for
support; one not able to exist or sustain oneself without
the power or aid of someone else." Under said general
definition,26 even an unborn child is a dependent of its
parents. Hortillano’s child could not have reached 38-
39 weeks of its gestational life without depending upon
its mother, Hortillano’s wife, for sustenance.
Additionally, it is explicit in the CBA provisions in
question that the dependentmay be the parent,
spouse, or child of a married employee; or the parent,
brother, or sister of a single employee. The CBA did
not provide a qualification for the child dependent, such
that the child must have been born or must have
acquired civil personality, as Continental Steel avers.
Without such qualification, then child shall be
understood in its more general sense, which includes
the unborn fetus in the mother’s womb.
The term legitimate merely addresses the dependent
child’s status in relation to his/her parents. In Angeles
v. Maglaya,27 we have expounded on who is a
legitimate child, viz:
A legitimate child is a product of, and, therefore, implies
a valid and lawful marriage. Remove the element of
lawful union and there is strictly no legitimate filiation
between parents and child. Article 164 of the Family
Code cannot be more emphatic on the matter:
"Children conceived or born during the marriage of
the parents are legitimate." (Emphasis ours.)
Conversely, in Briones v. Miguel,28 we identified an
illegitimate child to be as follows:
The fine distinctions among the various types of
illegitimate children have been eliminated in the Family
Code. Now, there are only two classes of children --
legitimate (and those who, like the legally adopted,
have the rights of legitimate children) and illegitimate.
All children conceived and born outside a valid
marriage are illegitimate, unless the law itself gives
them legitimate status. (Emphasis ours.)
It is apparent that according to the Family Code and
the afore-cited jurisprudence, the legitimacy or
illegitimacy of a child attaches upon his/her conception.
In the present case, it was not disputed that Hortillano
and his wife were validly married and that their child
was conceived during said marriage, hence, making
said child legitimate upon her conception.1avvphi1
Also incontestable is the fact that Hortillano was able
to comply with the fourth element entitling him to death
and accident insurance under the CBA, i.e.,
presentation of the death certificate of his unborn child.
Given the existence of all the requisites for
bereavement leave and other death benefits under the
CBA, Hortillano’s claims for the same should have
been granted by Continental Steel.
We emphasize that bereavement leave and other
death benefits are granted to an employee to give aid
to, and if possible, lessen the grief of, the said
employee and his family who suffered the loss of a
loved one. It cannot be said that the parents’ grief and
sense of loss arising from the death of their unborn
child, who, in this case, had a gestational life of 38-39
weeks but died during delivery, is any less than that of
parents whose child was born alive but died
subsequently.
Being for the benefit of the employee, CBA provisions
on bereavement leave and other death benefits should
be interpreted liberally to give life to the intentions
thereof. Time and again, the Labor Code is specific in
enunciating that in case of doubt in the interpretation of
any law or provision affecting labor, such should be
interpreted in favor of labor.29 In the same way, the
CBA and CBA provisions should be interpreted in favor
of labor. InMarcopper Mining v. National Labor
Relations Commission,30 we pronounced:
Finally, petitioner misinterprets the declaration of the
Labor Arbiter in the assailed decision that "when the
pendulum of judgment swings to and fro and the forces
are equal on both sides, the same must be stilled in
favor of labor." While petitioner acknowledges that all
doubts in the interpretation of the Labor Code shall be
resolved in favor of labor, it insists that what is involved-
here is the amended CBA which is essentially a
contract between private persons. What petitioner has
lost sight of is the avowed policy of the State, enshrined
in our Constitution, to accord utmost protection and
justice to labor, a policy, we are, likewise, sworn to
uphold.
195
 13
In Philippine Telegraph & Telephone Corporation v. I attest that the conclusions in the above Decision Id. at 62-65.
NLRC [183 SCRA 451 (1990)], we categorically stated were reached in consultation before the case was
14
that: assigned to the writer of the opinion of the Court’s Id at 66-72.
Division. 15
When conflicting interests of labor and capital are to be Records, pp. 46-53.
weighed on the scales of social justice, the heavier ANTONIO T. CARPIO 16 Article 40. Birth determines personality; but the
influence of the latter should be counter-balanced by Associate Justice
conceived child shall be considered born for all
sympathy and compassion the law must accord the Chairperson, Third Division
purposes that are favorable to it, provided it be born
underprivileged worker.
CERTIFICATION later with the conditions specified in the following
Likewise, in Terminal Facilities and Services article.
Corporation v. NLRC [199 SCRA 265 (1991)], we Pursuant to Section 13, Article VIII of the Constitution,
and the Division Chairperson’s Attestation, it is hereby Article 41. For civil purposes, the foetus is considered
declared:
certified that the conclusions in the above Decision born if it is alive at the time it is completely delivered
Any doubt concerning the rights of labor should be were reached in consultation before the case was from the mother’s womb. However, if the foetus had an
resolved in its favor pursuant to the social justice policy. assigned to the writer of the opinion of the Court’s intra-uterine life of less than seven months, it is not
Division. deemed born if it dies within twenty-four hours after its
IN VIEW WHEREOF, the Petition is DENIED. The complete delivery from the maternal womb.
Decision dated 27 February 2008 and Resolution LEONARDO A. QUISUMBING
dated 9 May 2008 of the Court of Appeals in CA-G.R. Acting Chief Justice Article 42. Civil personality is extinguished by death.
SP No. 101697, affirming the Resolution dated 20 The effect of death upon the rights and obligations of
November 2007 of Accredited Voluntary Arbitrator Atty. the deceased is determined by law, by contract and by
Allan S. Montaño, which granted to Rolando P. will.
Hortillano bereavement leave pay and other death 17
Footnotes CA rollo, pp. 24-34.
benefits in the amounts of Four Thousand Nine
Hundred Thirty-Nine Pesos (P4,939.00) and Eleven 1Penned by Associate Justice Martin S. Villarama, Jr. 18 Id. at 32.
Thousand Five Hundred Fifty Pesos (P11,550.00), with Associate Justices Noel G. Tijam and Sesinando
respectively, grounded on the death of his unborn E. Villon concurring; rollo, pp. 32-40.
19 Id. at 2-18.
child, are AFFIRMED. Costs against Continental Steel
Manufacturing Corporation. 2 Id. at 42. Art. 262-A of the Labor Code as amended in relation to
Section 7, Rule XIX of Department Order No. 40-03
SO ORDERED. 3Penned by Atty. Allan S. Montaño, Accredited series of 2003 provides that the decision, order,
Voluntary Arbitrator; records, pp. 381-392. resolution or award of the Voluntary Arbitrator shall be
MINITA V. CHICO-NAZARIO final and executory after ten (10) calendar days from
Associate Justice 4 CA rollo, p. 26. receipt of the copy of the award or decision by the
parties and that it shall not be subject of a motion for
WE CONCUR: 5 Rollo, pp. 84-92.
reconsideration.
ANTONIO T. CARPIO 6 Id. at 93. 20 Rollo, pp. 38-39.
Associate Justice
7
Chairperson Id. at 86. 21 Id. at 39.
8
PRESBITERO J. ANTONIO EDUARDO Id. at 33. 22 Id. at 153.
VELASCO, JR. B. NACHURA 9 CA rollo, p. 60. 23
Associate Justice Associate Justice Id. at 136-143.
10 Id. at 67.
DIOSDADO M. PERALTA 24 Black’s Law Dictionary
Associate Justice 11 Id. at 46. 25 Article II, Section 12 of the Constitution reads in full:
ATTESTATION 12 Id. at 25.
Sec. 12. The State recognizes the sanctity of family life
and shall protect and strengthen the family as a basic
196
autonomous social institution. It shall equally protect
the life of the mother and the life of the unborn from
conception. The natural and primary right and duty of
parents in the rearing of the youth for civic efficiency
and the development of moral character shall receive
the support of the Government.
26As opposed to the more limited or precise definition
of a dependent child for income tax purposes, which
means "a legitimate, illegitimate or legally adopted
child chiefly dependent upon and living with the
taxpayer if such dependent is not more than twenty-
one (21) years of age, unmarried and not gainfully
employed or if such dependent, regardless of age, is
incapable of self-support because of mental or physical
defect."
27G.R. No. 153798, 2 September 2005, 469 SCRA
363, 369.
28 483 Phil. 483, 491 (2004).
29Faculty Association of Mapua Institute of
Technology (FAMIT) v. Court of Appeals, G.R. No.
164060, 15 June 2007, 524 SCRA 709, 716.
30
325 Phil. 618, 634-635 (1996).
G.R. No. L-68470 October 8, 1985
ALICE REYES
vs.
HON. MANUEL V. ROMILLO, JR., as Presiding
Judge of Branch CX, Regional Trial Court of the
National Capital Region Pasay City and RICHARD
UPTON respondents.
MELENCIO-HERRERA, J.:\
In this Petition for certiorari and Prohibition, petitioner
Alice Reyes Van Dorn seeks to set aside the Orders,
dated September 15, 1983 and August 3, 1984, in Civil
Case No. 1075-P, issued by respondent Judge, which
denied her Motion to Dismiss said case, and her Motion
for Reconsideration of the Dismissal Order,
respectively.
The basic background facts are that petitioner is a
citizen of the Philippines while private respondent is a
citizen of the United States; that they were married in
Hongkong in 1972; that, after the marriage, they
established their residence in the Philippines; that they
begot two children born on April 4, 1973 and December
18, 1975, respectively; that the parties were divorced
in Nevada, United States, in 1982; and that petitioner
has re-married also in Nevada, this time to Theodore
Van Dorn.
Dated June 8, 1983, private respondent filed suit
against petitioner in Civil Case No. 1075-P of the
Regional Trial Court, Branch CXV, in Pasay City,
stating that petitioner's business in Ermita, Manila, (the
Galleon Shop, for short), is conjugal property of the
parties, and asking that petitioner be ordered to render
an accounting of that business, and that private
respondent be declared with right to manage the
conjugal property. Petitioner moved to dismiss the
case on the ground that the cause of action is barred
by previous judgment in the divorce proceedings
before the Nevada Court wherein respondent had
acknowledged that he and petitioner had "no
community property" as of June 11, 1982. The Court
below denied the Motion to Dismiss in the mentioned
case on the ground that the property involved is located
in the Philippines so that the Divorce Decree has no
bearing in the case. The denial is now the subject of
this certiorari proceeding.
Generally, the denial of a Motion to Dismiss in a civil
VAN DORN, petitioner, case is interlocutory and is not subject to appeal.
certiorari and Prohibition are neither the remedies to
question the propriety of an interlocutory order of the
trial Court. However, when a grave abuse of discretion
was patently committed, or the lower Court acted
capriciously and whimsically, then it devolves upon this
Court in a certiorari proceeding to exercise its
supervisory authority and to correct the error
197
committed which, in such a case, is equivalent to lack
of jurisdiction. 1 Prohibition would then lie since it would
be useless and a waste of time to go ahead with the
proceedings. 2 Weconsider the petition filed in this
case within the exception, and we have given it due
course.
For resolution is the effect of the foreign divorce on the
parties and their alleged conjugal property in the
Philippines.
Petitioner contends that respondent is estopped from
laying claim on the alleged conjugal property because
of the representation he made in the divorce
proceedings before the American Court that they had
no community of property; that the Galleon Shop was
not established through conjugal funds, and that
respondent's claim is barred by prior judgment.
For his part, respondent avers that the Divorce Decree
issued by the Nevada Court cannot prevail over the
prohibitive laws of the Philippines and its declared
national policy; that the acts and declaration of a
foreign Court cannot, especially if the same is contrary
to public policy, divest Philippine Courts of jurisdiction
to entertain matters within its jurisdiction.
For the resolution of this case, it is not necessary to
determine whether the property relations between
petitioner and private respondent, after their marriage,
were upon absolute or relative community property,
upon complete separation of property, or upon any
other regime. The pivotal fact in this case is the
Nevada divorce of the parties.
The Nevada District Court, which decreed the divorce,
had obtained jurisdiction over petitioner who appeared
in person before the Court during the trial of the case.
It also obtained jurisdiction over private respondent
who, giving his address as No. 381 Bush Street, San
Francisco, California, authorized his attorneys in the
divorce case, Karp & Gradt Ltd., to agree to the divorce
on the ground of incompatibility in the understanding
that there were neither community property nor
community obligations. 3 As explicitly stated in the
Power of Attorney he executed in favor of the law firm
of KARP & GRAD LTD., 336 W. Liberty, Reno, Nevada,
to represent him in the divorce proceedings:
xxx xxx xxx
You are hereby authorized to accept service of
Summons, to file an Answer, appear on my behalf and
do an things necessary and proper to represent me,
without further contesting, subject to the following:
1. That my spouse seeks a divorce on the ground of
incompatibility.
2. That there is no community of property to be
adjudicated by the Court.
3. 'I'hat there are no community obligations to be
adjudicated by the court.
xxx xxx xxx 4
There can be no question as to the validity of that
Nevada divorce in any of the States of the United
States. The decree is binding on private respondent as
an American citizen. For instance, private respondent
cannot sue petitioner, as her husband, in any State of
the Union. What he is contending in this case is that
the divorce is not valid and binding in this jurisdiction,
the same being contrary to local law and public policy.
It is true that owing to the nationality principle
embodied in Article 15 of the Civil Code, 5 only
Philippine nationals are covered by the policy against
absolute divorces the same being considered contrary
to our concept of public police and morality. However,
aliens may obtain divorces abroad, which may be
recognized in the Philippines, provided they are valid
according to their national law. 6 In this case, the
divorce in Nevada released private respondent from
the marriage from the standards of American law,
under which divorce dissolves the marriage. As stated
by the Federal Supreme Court of the United States in
Atherton vs. Atherton, 45 L. Ed. 794, 799:
The purpose and effect of a decree of divorce from the
bond of matrimony by a court of competent jurisdiction
are to change the existing status or domestic relation
of husband and wife, and to free them both from the
bond. The marriage tie when thus severed as to one
party, ceases to bind either. A husband without a wife,
or a wife without a husband, is unknown to the law.
When the law provides, in the nature of a penalty. that
the guilty party shall not marry again, that party, as well
as the other, is still absolutely freed from the bond of
the former marriage.
Thus, pursuant to his national law, private respondent
is no longer the husband of petitioner. He would have
no standing to sue in the case below as petitioner's
husband entitled to exercise control over conjugal
assets. As he is bound by the Decision of his own
country's Court, which validly exercised jurisdiction
over him, and whose decision he does not repudiate,
he is estopped by his own representation before said
Court from asserting his right over the alleged conjugal
property.
To maintain, as private respondent does, that, under
our laws, petitioner has to be considered still married
to private respondent and still subject to a wife's
obligations under Article 109, et. seq. of the Civil Code
cannot be just. Petitioner should not be obliged to live
together with, observe respect and fidelity, and render
support to private respondent. The latter should not
continue to be one of her heirs with possible rights to
conjugal property. She should not be discriminated
against in her own country if the ends of justice are to
be served.
WHEREFORE, the Petition is granted, and respondent
Judge is hereby ordered to dismiss the Complaint filed
in Civil Case No. 1075-P of his Court.
Without costs.
SO ORDERED.
Teehankee (Chairman), Plana, Relova, Gutierrez, Jr.,
De la Fuente and Patajo, JJ., concur.
Footnotes
1 Sanchez vs. Zosa, 68 SCRA 171 (1975); Malit vs.
People, 114 SCRA 348 (1982).
2 U.S.T. vs. Hon. Villanueva, et al., 106 Phil. 439
(1959).
3 Annex "Y", Petition for Certiorari.
4 p. 98, Rollo.
5 "Art. 15. Laws relating to family rights and duties or
to the status, condition and legal capacity of persons
are binding upon citizens of the Philippines, even
though living abroad.
198
6 cf. Recto vs. Harden, 100 Phil. 427 [1956]; Paras,
Civil Code, 1971 ed., Vol. I, p. 52; Salonga, Private
International Law, 1979 ed., p. 231."
G.R. No. 190667, November 07, 2016
COCA-COLA BOTTLERS PHILIPPINES,
INC., Petitioner, v. SPOUSES JOSE R. BERNARDO
AND LILIBETH R. BERNARDO, DOING BUSINESS
UNDER THE NAME AND STYLE "JOLLY
BEVERAGE ENTERPRISES," Respondents.
DECISION
SERENO, C.J.:
This is a Petition for Review1 filed by Coca-Cola
Bottlers Philippines, Inc. (petitioner), from the Court of
Appeals (CA) Decision2 and Resolution3 in CA-GR. CV
No. 91096. The CA affirmed in toto the Decision4 of
Regional Trial Court (RTC) Branch 88 in Quezon City
in Civil Case No. Q-00-42320.
This case originated from the claim for damages filed
by respondent spouses Jose and Lilibeth Bernardo
(respondents) against petitioner for violation of Articles
19, 20, 21, and 28 of the Civil Code. The RTC found
petitioner liable to pay respondents temperate
damages in the amount of P500,000 for loss of
goodwill, to be offset against the latter's outstanding
balance for deliveries in the amount of P449,154. The
trial court ordered petitioner to pay P50,000 as moral
damages, P20,000 as exemplary damages, and
P100,000 as attorney's fees.
Petitioner asserts that the Complaint had no basis, and
that the trial court had no jurisdiction to award
temperate damages in an amount equivalent to the
outstanding obligation of respondents. It prays not only
for the reversal of the assailed judgments, but also for
an award of moral and exemplary damages, as well as
attorney's fees and litigation expenses. It also asks that
respondents be ordered to pay P449,154 plus legal
interest from the date of demand until full payment. 5
We deny the Petition.chanroblesvirtuallawlibrary
FACTS
Petitioner is a domestic corporation engaged in the
large-scale manufacture, sale, and distribution of
beverages around the country.6 On the other hand,
respondents, doing business under the name "Jolly
199
Beverage Enterprises," are wholesalers of softdrinks in
Quezon City, particularly in the vicinities of Bulacan
Street, V. Luna Road, Katipunan Avenue, and Timog
Avenue.7
The business relationship between the parties
commenced in 1987 when petitioner designated
respondents as its distributor.8 On 22 March 1994, the
parties formally entered into an exclusive dealership
contract for three years.9 Under the
Agreement,10 petitioner would extend developmental
assistance to respondents in the form of cash
assistance and trade discount incentives. For their
part, respondents undertook to sell petitioner's
products exclusively, meet the sales quota of 7,000
cases per month, and assist petitioner in its marketing
efforts.11
On 1 March 1997, the parties executed a similar
agreement tor another two years, or until 28 February
1999.12 This time, petitioner gave respondents
complimentary cases of its products instead of cash
assistance, and increased the latter's sales quota to
8,000 cases per month.
For 13 years, the parties enjoyed a good and
harmonious business partnership.13 While the
contracts contained a clause for breach, it was never
enforced.14
Sometime in late 1998 or early 1999, before the
contract expired, petitioner required respondents to
submit a list of their customers on the pretext that it
would formulate a policy defining its territorial
dealership in Quezon City.15 It assured respondents
that their contract would be renewed for a longer
period, provided that they would submit the
list.16 However, despite their compliance, the promise
did not materialize.17
Respondents discovered that in February 1999,
petitioner started to reach out to the persons whose
names were on the list.18 Respondents also received
reports that their delivery trucks were being trailed by
petitioner's agents; and that as soon as the trucks left,
the latter would approach the former's
customers.19 Further, respondents found out that
petitioner had employed a different pricing scheme,
such that the price given to distributors was
significantly higher than that given to supermarkets. 20 It
also enticed direct buyers and sari-sari store owners in
the area with its "Coke Alok" promo, in which it gave
away one free bottle for every case purchased.21 It
further engaged a store adjacent to respondents'
warehouse to sell the former's products at a
substantially lower price.22
Respondents claimed that because of these schemes,
they lost not only their major customers - such as
Peach Blossoms, May Flower Restaurant, Saisaki
Restaurant, and Kim Hong Restaurant but also small
stores, such as the canteen in the hospital where
respondent Jose Bernardo worked.23 They admitted
that they were unable to pay deliveries worth
P449,154.24
Respondents filed a Complaint25 for damages, alleging
that the acts of petitioner constituted dishonesty, bad
faith, gross negligence, fraud, and unfair competition in
commercial enterprise.26 The Complaint was later
amended27 to implead petitioner's officers and
personnel, include additional factual allegations, and
increase the amount of damages prayed for.
Petitioner denied the allegations.28 It maintained that it
had obtained a list of clients through surveys, and that
promotional activities or developmental strategies were
implemented only after the expiration of the
Agreements.29 It opined that the filing of the complaint
was a mere ploy resorted to by respondents to evade
the payment of the deliveries.30
The RTC held petitioner liable for damages for abuse
of rights in violation of Articles 19, 20, and 21 of the
Civil Code and for unfair competition under Article 28.
It found that petitioner's agents solicited the list of
clients in order to penetrate the market and directly
supply customers with its products.31 Moreover, the
trial court found that petitioner had recklessly ignored
the rights of respondents to have a fair chance to
engage in business or earn a living when it deliberately
used oppressive methods to deprive them of their
business.32 Its officers were, however, absolved of
liability, as there was no showing that they had acted
in their individual and personal capacities.33
In the body of its Decision, the RTC stated that
petitioner should pay respondents P500,000 as
temperate damages, and that it was only just and fair
that the latter offset this amount against their
outstanding obligation to petitioner in the amount of
P449,154.34 In the fallo, the trial court awarded
P50,000 as moral damages, P20,000 as exemplary
damages, and P100,000 as attorney's fees.35 It denied
petitioner's counterclaim for damages for lack of factual
and legal basis.36 Petitioner moved for reconsideration,
but the motion was denied.37
Petitioner then elevated the case to the CA, which
affirmed the RTC Decision in toto. According to the
appellate court's ruling, petitioner had used its sizable
resources to railroad the business of
respondents:38chanroblesvirtuallawlibrary
[Petitioner] infiltrated certain areas in Quezon City at
the expense of and later, in derogation of its
wholesalers, particularly [respondents]. As admitted by
Allan Mercado, the Integrated Selling and Marketing
Manager of appellant, it was previously dependent on
wholesalers to circulate its products around the
country. x x x.
x x x x
[T]owards the end of the partnership, appellant
employed a different marketing scheme purportedly to
obviate the poor dealership management from
wholesalers in major areas. But as may be shown by
the incidents leading to the filing of this case, this
method was designed strategically to overrun
[respondents'] business and take over the customers
of its wholesalers.
x x x x
One such method was "different pricing schemes"
wherein the prices given to supermarkets and grocery
stores were considerably lower than those imposed on
wholesalers. No prior advice thereof was given to
[respondents] or any of the wholesalers. In fact, they
only knew of it when their customers began
complaining about the variation in prices of softdrinks
sold in supermarkets and those that were sold by them.
When in fact [respondent] Bernardo personally
inspected the products in grocery stores, he
discovered that a box of Coke-in-can is sold at P40.00,
lower than those offered by them as wholesalers.
200

About the same time, [petitioner] also implemented the
"Area Market Cooperatives" (AMC) and the "Coke-
Alok" promo. Under the AMC, customers of
wholesalers can purchase [petitioner's] products from
prominent stores in heavily crowded areas for P76.00
per case, as opposed to [respondent's] offering of
P112.00. In "Coke-Alok," [petitioner] directly sold Coke
products to wholesale customers with incentives as
free bottle of Coke for every case of softdrinks
purchased. Being of limited resources, [respondents
had no] means to equal the lucrative incentives given
by [petitioner] to their customers.
x x x x
Apart from direct selling and other promotions,
[petitioner] also employed high-handed means that
further shrunk [respondents'] market coverage. In one
instance, [petitioner's sales representative] advised
[respondents] and other wholesalers to keep away
from major thoroughfares. Apparently, [petitioner] was
going to supply their products to these stores
themselves. x x x.
x x x x
x x x Furthermore, one of [petitioner's] representatives,
Nelson Pabulayan, admitted that he sold products at
the canteen in V. Luna Hospital [which was then being
serviced by respondents].
As if that was not enough, petitioner engaged other
stores, such as Freezel's Bakeshop that was located
adjacent to [respondent's] warehouse, to sell Coke
products at a price substantially lower than [that offered
by respondents].
ISSUES
Petitioner argues that the trial court had no jurisdiction
to award temperate damages that were not prayed for
in the Complaint. It further asserts that it did not violate
Articles 19, 20, 21 or 28; hence, the award of damages
and attorney's fees was
improper.chanroblesvirtuallawlibrary
OUR RULING
The CA did not err in affirming the finding that petitioner
was liable for temperate, moral and exemplary
damages, as well as attorney's fees, tor abuse of rights
and unfair competition.
The Petition raises questions of fact.
Petitioner ignores the nature of a petition for review as
a remedy against errors of law. Instead, it raises factual
matters that have already been passed upon by the
RTC and the CA.
It insists on the following facts: 1) the "promotional
activities" were implemented after the dealership
agreements expired;39 2) the "developmental
strategies" were implemented nationwide and were not
meant to destroy the business of respondents;40 3) its
agents did not follow the trucks of Jolly Beverages;41 4)
the price difference resulted because respondents
could no longer avail of trade discounts and incentives
under the expired Agreement;42 and 5) there is no
causal connection between the promotional activities
and the claimed losses of respondents.43
Petitioner contends that since it did not assign any
exclusive territory to respondents, the latter had no
exclusive right to any customer.44 It supposedly
decided to rely on its own sales personnel to push the
sale of its products, because the distributors had
violated the terms of their agreements by selling
competing products, failing to meet the required sales
volume, or failing to pay on time.45 Petitioner, however,
did not allege that respondents committed any of these
actions during the existence of the agreement.
We have repeatedly held that factual findings of the
trial court, especially when affirmed by the appellate
court, are given great weight, even finality, by this
Court.46 Petitioner fails to make a convincing argument
that this case falls under any of the exceptions to the
rule. On the contrary, the Decisions of the RTC and
theCA appear to be supported by the records.
Petitioner bewails the fact that the RTC and the CA, in
establishing the facts, relied heavily on the testimony
of respondent Jose Bernardo.47
Petitioner, however, forgets that trial courts are in an
ideal position to observe the demeanor of the
witnesses and can therefore discern if the latter are
telling the truth or not.48 In this case, both the trial and
the appellate courts found the testimonies of
respondent Jose Bernardo and his witnesses more
credible than those of the witnesses presented by
petitioners. We shall not substitute our judgment for
that of the trial court, absent any compelling reason.
Petitioner is liable for damages for abuse of rights
and unfair competition under the Civil Code.
Both the RTC and the CA found that petitioner had
employed oppressive and high-handed schemes to
unjustly limit the market coverage and diminish the
investment returns of respondents.49 The CA
summarized its findings as
follows:50chanroblesvirtuallawlibrary
This [cut-throat competition] is precisely what appellant
did in order to take over the market: directly sell its
products to or deal them off to competing stores at a
price substantially lower than those imposed on its
wholesalers. As a result, the wholesalers suffered
losses, and in [respondents'] case, laid ofT a number
of employees and alienated the patronage of its major
customers including small-scale stores.
It must be emphasized that petitioner is not only a
beverage giant, but also the manufacturer of the
products; hence, it sets the price. In addition, it took
advantage of the infonnation provided by respondents
to facilitate its takeover of the latter's usual business
area. Distributors like respondents, who had assisted
petitioner in its marketing efforts, suddenly found
themselves with fewer customers. Other distributors
were left with no choice but to fold.51
Articles 19, 20, and 21 of the Civil Code provide the
legal bedrock for the award of damages to a party who
suffers damage whenever another person commits an
act in violation of some legal provision; or an act which,
though not con'itituting a transgression of positive law,
nevertheless violates certain rudimentary rights of the
party aggrieved.52 The provisions
read:chanRoblesvirtualLawlibrary
Art. 19. Every person must, in the exercise of his rights
and in the performance of his duties, act with justice,
give everyone his due, and observe honesty and good
201
faith.
Art. 20. Every person who, contrary to law, wilfully or
negligently causes damage to another, shall indemnify
the latter for the same.
Art. 21. Any person who wilfully causes loss or injury to
another in a manner that is contrary to morals, good
customs or public policy shall compensate the latter for
the damage.
In Albenson Enterprises Corp. v. CA,53 this Court held
that under any of the above provisions of law, an act
that causes injury to another may be made the basis
for an award of damages. As explained by this Court
in GF Equity, Inc. v.
Valenzona:54chanroblesvirtuallawlibrary
The exercise of a right ends when the right disappears;
and it disappears when it is abused, especially to the
prejudice of others. The mask of a right without the
spirit of justice which gives it life is repugnant to the
modern concept of social law. It cannot be said that a
person exercises a right when he unnecessarily
prejudices another or offends morals or good customs.
Over and above the specific precepts of positive law
are the supreme norms of justice which the law
develops and which are expressed in three
principles: honeste vivere, alterum non laedere and jus
suum quique tribuere; and he who violates them
violates the law. For this reason, it is not permissible to
abuse our rights to prejudice others.
Meanwhile, the use of unjust, oppressive, or high-
handed business methods resulting in unfair
competition also gives a right of action to the injured
party. Article 28 of the Civil Code
provides:chanRoblesvirtualLawlibrary
Art. 28. Unfair competition in agricultural, commercial
or industrial enterprises or in labor through the use of
force, intimidation, deceit, machination or any other
unjust, oppressive or highhanded method shall give
rise to a right of action by the person who thereby
sutlers damage.
Petitioner cites Tolentino, who in turn cited Colin and
Capitant. According to the latter, the act of "a merchant
[who] puts up a store near the store of another and in
this way attracts some of the latter's patrons" is not an
abuse of a right.55 The scenario in the present case is
vastly different: the merchant was also the producer
who, with the use of a list provided by its distributor,
knocked on the doors of the latter's customers and
offered the products at a substantially lower price.
Unsatisfied, the merchant even sold its products at a
preferential rate to another store within the vicinity.
Jurisprudence holds that when a person starts an
opposing place of business, not for the sake of profit,
but regardless of Joss and for the sole purpose of
driving a competitor out of business, in order to take
advantage of the effects of a malevolent purpose, that
person is guilty of a wanton wrong.56
Temperate, moral, and exemplary damages, as well
as attorney's fees, were properly awarded.
Petitioner argues that the trial court did not have
jurisdiction to grant an award of temperate damages,
because respondents did not specifically pray for it in
their Amended Complaint:chanRoblesvirtualLawlibrary
WHEREFORE, premises considered, it is most
respectfully prayed that the Honorable Court render a
judgment directing defendants to:
1. Pay plaintiffs the amount of P1,000,000.00
representing loss of goodwill nurtured over
the past 13 years as actual damages.
2. Pay plaintiffs the amount of P200,000
representing moral damages.
3. Pay plaintiffs the amount of P100,000
representing exemplary damages.
4. Pay plaintiffs the amount of P100,000
representing attorney's fees.
Other reliefs which are just and equitable under the
premises are also prayed for.
Petitioner's argument is flimsy and unsupported even
by the cases it has cited.57 The CA correctly ruled that
the award of temperate damages was justified, even if
it was not specifically prayed for, because 1)
respondents did pray for the grant of "other reliefs," and
2) the award was clearly warranted under the
circumstances. Indeed, the law permits judges to
award a different kind of damages as an alternative to
actual damages:chanRoblesvirtualLawlibrary
Civil Code, Art. 2224. Temperate or moderate
damages, which are more than nominal but less than
compensatory damages, may be recovered when the
court finds that some pecuniary loss has been
suffered but its amount can not, from the nature of the
case, be provided with certainty. (Emphasis supplied)
Compensatory damages may be awarded in
the concept of temperate damages for injury to
business reputation or business standing, loss of
goodwill, and loss of customers who shifted their
patronage to competitors.58
It is not extraordinary for courts to award temperate
damages in lieu of actual damages. In Canada v. All
Commodities Marketing Corporation,59 this Court
awarded temperate damages in recognition of the
pecuniary loss suffered, after finding that actual
damages could not be awarded for lack of proof.
In Public Estates Authority v. Chu,60 this Court held
that temperate damages should have been awarded by
the trial court considering that the plaintiff therein had
suffered some pecuniary loss.
In this case, both the RTC and the CA found that
respondents had similarly suffered pecuniary loss by
reason of petitioner's high-handed machinations to
eliminate competition in the market.61
We see no grave error on the part of the RTC when it
ruled that the unpaid obligation of respondents shall be
offset against the temperate damages due them from
petitioner.62 However, the trial court was not accurate
in considering the P500,000 temperate damages as
adequate to completely extinguish the obligation of
respondents to petitioner.63 We note that while the
principal was P449,154, this amount earned legal
interest from the time of demand. Nonetheless, in view
of the established fact that respondents incurred the
losses after their business was systematically crippled
by petitioner, it is only proper and just that the
obligation, as well as the legal interest that has
accrued, be deemed totally compensated by the
temperate damages. Therefore, respondents do not
need to tender the amount of P449,154 plus legal
interest to petitioner, while the latter does not have to
tender any amount as temperate damages to the
former.
202
 5
With regard to moral damages, petitioner argues that no basis and were properly denied. The fact that Id. at 34.
respondents failed to provide satisfactory proof that the petitioner was compelled to engage the services of
latter had undergone any suffering or injury.64 This is a counsel in order to defend itself against the suit of 6 Id. at 43.
factual question that has been resolved by the trial respondents did not entitle it to attorney's fees.
7
court in a Decision affirmed by the CA. The award finds Id.
legal basis under Article 2219(10) of the Civil Code, According to petitioner, it is entitled to moral damages,
8
which states that moral damages may be recovered in because "respondents clearly acted in a vexatious Id.
acts and actions referred to in Articles 21 and 28.65 manner when they instituted this suit."70 We see
9
nothing in the record to sustain this argument. Id.
Petitioner likewise questions the award of exemplary
damages without "competent proof."66 It cites Spouses With respect to the prayer for exemplary damages, 10 Id. at 93-95.
Villafuerte v. CA67 as basis for arguing that the CA neither do we find any act of respondents that has to
11
should have based its Decision regarding the fact and be deterred. Id. at 93-94.
the amount of exemplary damages upon competent
WHEREFORE, the Petition is DENIED. The Decision 12
proof that respondents have suffered injury and upon Agreement; id. at 97-99.
evidence of the actual amount thereof. We enjoin dated 23 July 2009 and Resolution dated 19 November
13Rollo,
petitioner's counsel to fully and carefully read the text 2009 rendered by the Court of Appeals in CA-G.R. CV p. 110.
of our decisions before citing them as authority. 68 The No. 91096, which affirmed in toto the Decision dated
14
excerpt lifted pertains to compensatory damages, not 28 September 2007 issued by Regional Trial Court This observation was consistent with respondents'
exemplary damages. We remind counsel that Branch 88 Quezon City in Civil Case No. Q-00-42320, claim that they had faithfully complied with all their
exemplary damages are awarded under Article 2229 of are hereby AFFIRMED with MODIFICATION in that obligations.
the Civil Code by way of example or correction for the the damages awarded shall earn legal interest of 6%
15Rollo,
public good. The determination of the amount is left to per annum from the date of finality of this Decision until p. 44, 110.
the discretion of the judge; its proof is not incumbent its full satisfaction. The total compensation of
16
upon the claimant. respondents' unpaid obligation, including legal interest Id.
that has accrued, and the temperate damages
17
There being no meritorious argument raised by awarded to them, is hereby upheld. Id. at 110.
petitioner, the award of exemplary damages must be
SO ORDERED.ChanRoblesVirtualawlibrary 18
sustained to caution powerful business owners against Id.
the use of oppressive and high-handed commercial
Leonardo-De Castro, Bersamin, Perlas-Bernabe, 19
strategies to target and trample on the rights of small Id. at 111.
business owners, who are striving to make a decent and Caguioa, JJ., concur.
20
living. Id. at 53.
Endnotes:
21
Exemplary damages having been awarded, the grant Id.
of attorney's fees was therefore warranted.69
22
1Rollo,
Id. at 55.
Petitioner's counterclaims for moral and pp. 10-35.
exemplary damages, as well as attorney's fees and 23
2
Id. at 115.
litigation expenses, were properly denied. Penned by Presiding Justice Conrado M. Vasquez
and concurred in by Associate Justices Arturo G. 24 Id. at 45.
The counterclaim for the payment of P449,154 plus Tayag and Ramon M. Bato, Jr., dated 23 July 2009; id.
legal interet was effectively granted when the trial court at 42-59. 25 Id. at 62-64.
offset the temperate damages awarded to respondents 3
against the outstanding obligation of the latter to Dated 19 November 2009; id. at 60-61. 26 Id.
petitioner. 4Penned by Presiding Judge Rosanna Fe Romero- 27 ld. at 82-92.
The counterclaims for moral and exemplary damages, Maglaya, dated 28 September 2007; id. at 109-121.
28See
as well as attorney's fees and litigation expenses, had Answer, id. at 66-76.

203
 that they had closed their stores because of business
29 losses; see id. at 116. 60
Id. at 71. 507 Phil. 472 (2005).
30 52Carpio 61Rollo,
Id. at 74. v. Valmonte, 481 Phil. 352 (2004). p. 58.
31 53 62
Id. 109-121. G.R. No. 88694, 11 January 1993, 217 SCRA 16. Petitioner never questioned this part of the RTC
Decision pertaining to the offsetting (See id. at
32 54
Id. at 120. 501 Phil. 153, 164-165 (2005) citing De Guzman v. 121):cralawlawlibrary
NLRC, G.R. No. 90856, 23 July 1992, 211 SCRA 723
33 Id. further citing Tolentino, Civil Code of the Philippines, The Court is not unmindful of the undisputed fact that
Vol. 1, 61 (1990). plaintiffs have an outstanding obligation with CCBPI in
34 Id. at 121. the amount of P449,154.00. However, record shows
55Rollo, p. 30. that said outstanding obligation was incurred by the
35 Id. plaintiffs at the time the afore-said marketing strategies
56WillawareProducts Corp. v. Jesichris Manufacturing were already employed by CCBPI and the wholesalers'
36 Corp., G.R. No. 195549, 3 September 2014, 734
Id. grievances including that of the plaintiffs were already
SCRA 238 citing Tolentino, supra note 54, p. 117. aired by them. Hence, it is not amiss to deduce that
37 Order dated 8 February 2008; id. at 141-143. these obligations arose as a result of CCBPI's
57Casent Realty v. Premiere Development Bank (516 machinations leading to plaintiff's business reversals.
38Rollo, pp. 52-55. Phil. 219 [2006]) does not aid its cause. In that case, The Court thus tinds, as justice and fair play require,
the trial court denied Casent Realty's Very Urgent that plaintiff's outstanding obligation be offset by the
39 Id. at 25. Motion for Clarification regarding the functions of an temperate damages CCBPI caused to plaintiffs and is
independent auditor, but allowed the petitioner to file a held liable for as a consequence of its unfair marketing
40 Id. at 26. manifestation that it was uninterested in having strategies.
independent auditors assist the parties in arriving at an
41 63
Id. at 27. amicable settlement of the case, so that pre-trial would In order to effect total compensation under Article
proceed. While this Court found that the order of the 1281 of the Civil Code, the two debts must be of the
42 Id. at 28. trial court was inconsistent with the allegations made in same amount.
the motion, it held that there was no grave abuse of
43 64Rollo,
Id. at 30. discretion. pp. 22-23.
44 The other case cited by petitioner, Spouses Gonzaga 65
Id. at 25. Article 2219. Moral damages may be recovered in
v. CA (483 Phil. 424 [2004]), is inapplicable. In that the following and analogous cases:cralawlawlibrary
45 Id. at 12-13. case, the petition was denied because of the failure of
Spouses Gonzaga to file a cross-claim against a third x x x x
46Castillo v. CA, 329 Phil. 150 ( 1996). party for the refund of a certain amount. The additional
relief they asked from the court - the enforcement of (10) Acts and actions referred to in articles 21, 26,
47Rollo, 27, 28, 29, 30, 32, 34, and 35.
pp. 21, 26-27. the deed of conditional sale, the deed of final and
absolute sale, and the memorandum of agreement
48People 66Rollo,
v. Cabalhin y Daclitan, G.R. No. 100204, 28 executed by them and the third partywould be distinct p. 23.
March 1994, 231 SCRA 486 citing People v. Rodriguez from the relief they prayed for in their third-party
y Teves, 254 Phil. 763 (1989); People v. Solares y 67
complaint, which is for the payment of whatever would 498 Phil. 105 (2005).
Manaloto, 255 Phil. 196 (1989). be adjudged against them for their occupation of the
68
land. In this case, the trial court merely awarded an Rule 10.2, Canon 10 of the Code of Professional
49Rollo, pp. 56, 118. alternative kind of damages. Responsibility states:cralawlawlibrary
50 58RCPI
Id. at 54. v. CA, 190 Phil. 1058 (1981). Rule 10.02 - A lawyer shall not knowingly misquote or
misrepresent the contents of a paper, the language or
51 59
Glicerio Oliveros, Jr. and Zenaida Flores testified 590 Phil. 342 (2008). the argument of opposing counsel, or the text of a

204
decision or authority, or knowingly cite as law a G.R. No. 217426, December 04, 2017
provision already rendered inoperative by repeal or
amendment, or assert as a fact that which has not been ST. MARTIN POLYCLINIC, INC., Petitioner, v. LWV
proved. CONSTRUCTION CORPORATION, Respondent.

69 DECISION
Art. 2208. In the absence of stipulation, attorney's
fees and expenses of litigation, other than judicial PERLAS-BERNABE, J.:
costs, cannot be recovered, except:cralawlawlibrary
Assailed in this petition for review on certiorari1 are the
(1) When exemplary damages are Decision2 dated July 11, 2014 and the
awarded;ChanRoblesVirtualawlibrary Resolution3 dated February 27, 2015 of the Court of
Appeals (CA) in CA-G.R. SP No. 125451, which
x x x x affirmed with modification the Decision4 dated
December 15, 2011 and the Order dated May 25, 2012
See also PhilTranco Service Enterprises, Inc. v. CA, of the Regional Trial Court of Mandaluyong City,
340 Phil. 98 ( 1997); Air France v. Carrascoso, 124 Branch 211 (RTC) in SCA Case No. MC11-879 (Civil
Phil. 722 (1966). Case No. 21881), and thereby ordered herein
petitioner St. Martin Polyclinic, Inc. (petitioner) to pay
70Rollo, p. 33. respondent LWV Construction Corporation
(respondent) temperate damages in the amount of
P50,000.00.

The Facts

Respondent is engaged in the business of recruiting

Filipino workers for deployment to Saudi Arabia.5 On
the other hand, petitioner is an accredited member of
the Gulf Cooperative Council Approved Medical
Centers Association (GAMCA) and as such, authorized
to conduct medical examinations of prospective
applicants for overseas employment.6

On January 10, 2008, respondent referred prospective

applicant Jonathan V. Raguindin (Raguindin) to
petitioner for a pre-deployment medical examination in
accordance with the instructions from GAMCA.7After
undergoing the required examinations, petitioner
cleared Raguindin and found him "fit for employment,"
as evidenced by a Medical Report8 dated January 11,
2008 (Medical Report).9

Based on the foregoing, respondent deployed

Raguindin to Saudi Arabia, allegedly incurring
expenses in the amount of
P84,373.41.10 Unfortunately, when Raguindin
underwent another medical examination with the
General Care Dispensary of Saudi Arabia (General
Care Dispensary) on March 24, 2008, he purportedly
tested positive for HCV or the hepatitis C virus. The
Ministry of Health of the Kingdom of Saudi Arabia
205
(Ministry of Health) required a re-examination of
Raguindin, which the General Care Dispensary
conducted on April 28, 2008.11 However, the results of
the re-examination remained the same, i.e., Raguindin
was positive for HCV, which results were reflected in a
Certification12 dated April 28, 2008 (Certification). An
undated HCV Confirmatory Test Report13 likewise
conducted by the Ministry of Health affirmed such
finding, thereby leading to Raguindin's repatriation to
the Philippines.14
Claiming that petitioner was reckless in issuing its
Medical Report stating that Raguindin is "fit for
employment" when a subsequent finding in Saudi
Arabia revealed that he was positive for HCV,
respondent filed a Complaint15 for sum of money and
damages against petitioner before the Metropolitan
Trial Court of Mandaluyong City, Branch 60 (MeTC).
Respondent essentially averred that it relied on
petitioner's declaration and incurred expenses as a
consequence. Thus, respondent prayed for the award
of damages in the amount of P84,373.41 representing
the expenses it incurred in deploying Raguindin
abroad.16
In its Answer with compulsory
counterclaim,17 petitioner denied liability and claimed
that: first, respondent was not a proper party in interest
for lack of privity of contract between them; second, the
MeTC had no jurisdiction over the case as it involves
the interpretation and implementation of a contract of
employment; third, the action is premature as
Raguindin has yet to undergo a post-employment
medical examination following his repatriation;
and fourth, the complaint failed to state a cause of
action as the Medical Report issued by petitioner had
already expired on April 11, 2008, or three (3) months
after its issuance on January 11, 2008.18
The MeTC Ruling
In a Decision19 dated December 17, 2010, the MeTC
rendered judgment in favor of respondent and ordered
petitioner to pay the amount of P84,373.41 as actual
damages, P20,000.00 as attorney's fees, and the costs
of suit.20
At the onset, the MeTC held that it had jurisdiction over
the case, since respondent was claiming actual
damages incurred in the deployment of Raguindin in
the amount of P84,373.41.21 It further ruled that
respondent was a real party in interest, as it would not
have incurred expenses had petitioner not issued the
Medical Report certifying that Raguindin was fit to
work.
On the merits, the MeTC found that respondent was
entitled to be informed accurately of the precise
condition of Raguindin before deploying the latter
abroad and consequently, had sustained damage as a
result of the erroneous certification.22 In this relation, it
rejected petitioner's contention that Raguindin may
have contracted the disease after his medical
examination in the Philippines up to the time of his
deployment, there being no evidence offered to
corroborate the same.23
Aggrieved, petitioner appealed to the RTC,
contending,24 among others, that respondent failed to
comply with the requirements on the authentication
and proof of documents under Section 24,25 Rule 132
of the Rules of Court, considering that respondent's
evidence, particularly the April 28, 2008 Certification
issued by the General Care Dispensary and the HCV
Confirmatory Test Report issued by the Ministry of
Health, are foreign documents issued in Saudi Arabia.
The RTC Ruling
In a Decision26 dated December 15, 2011, the RTC
dismissed petitioner's appeal and affirmed the MeTC
Decision in its entirety.27 Additionally, the RTC pointed
out that petitioner can no longer change the theory of
the case or raise new issues on appeal, referring to the
latter's argument on the authentication of respondent's
documentary evidence.28
Petitioner's motion for reconsideration29 was denied in
an Order30 dated May 25, 2012. Dissatisfied, petitioner
elevated the case to the CA.31
The CA Ruling
In a Decision32
dated July 11, 2014, the CA affirmed
the RTC Decision, with the modification deleting the
award of actual damages and instead, awarding
temperate damages in the amount of P50,000.00.33
The CA held that petitioner failed to perform its duty to
accurately diagnose Raguindin when it issued its
Medical Report declaring the latter "fit for employment",
considering that he was subsequently found positive
for HCV in Saudi Arabia.34 Further, the CA opined that
the Certification issued by the General Care
Dispensary is not a public document and in such
regard, rejected petitioner's argument that the same is
inadmissible in evidence for not having been
authenticated. Moreover, it remarked that petitioner's
own Medical Report does not enjoy the presumption of
regularity as petitioner is merely an accredited
clinic.35 Finally, the CA ruled that petitioner could not
disclaim liability on the ground that Raguindin tested
positive for HCV in Saudi Arabia after the expiration of
the Medical Report on April 11, 2008, noting that the
General Care Dispensary issued its Certification on
April 28, 2008, or a mere seventeen (17) days from the
expiration of petitioner's Medical Report.36 Hence, the
CA concluded that "it is contrary to human experience
that a newly-deployed overseas worker, such as
Raguindin, would immediately contract a serious virus
at the very beginning of a deployment."37
However, as the records are bereft of evidence to show
that respondent actually incurred the amount of
P84,373.41 as expenses for Raguindin's deployment,
the CA deleted the award of actual damages and
instead, awarded temperate damages in the amount of
P50,000.00.38
Aggrieved, petitioner filed a motion for partial
reconsideration,39 which the CA denied in a
Resolution40dated February 27, 2015; hence, this
petition.
The Issue Before the Court
The essential issue advanced for the Court's resolution
is whether or not petitioner was negligent in issuing the
Medical Report declaring Raguindin "fit for
employment" and hence, should be held liable for
damages.
The Court's Ruling
The petition is granted.
I.
At the outset, it should be pointed out that a re-
examination of factual findings cannot be done acting
on a petition for review on certiorari because the Court
is not a trier of facts but reviews only questions of
206
law.41 Thus, in petitions for review on certiorari, only
questions of law may generally be put into issue. This
rule, however, admits of certain exceptions, such as
"when the inference made is manifestly mistaken,
absurd or impossible"; or "when the findings are
conclusions without citation of specific evidence on
which they are based."42 Finding a confluence of
certain exceptions in this case, the general rule that
only legal issues may be raised in a petition for review
on certiorari under Rule 45 of the Rules of Court would
not apply, and the Court retains the authority to pass
upon the evidence presented and draw conclusions
therefrom.43
II.
An action for damages due to the negligence of
another may be instituted on the basis of Article 2176
of the Civil Code, which defines a quasi-delict:
Article 2176. Whoever by act or omission causes
damage to another, there being fault or negligence, is
obliged to pay for the damage done. Such fault or
negligence, if there is no pre-existing contractual
relation between the parties, is called a quasi-delict
and is governed by the provisions of this Chapter.
The elements of a quasi-delict are: (1) an act or
omission; (2) the presence of fault or negligencein
the performance or non-performance of the act; (3)
injury; (4) a causal connection between the
negligent act and the injury; and (5) no pre-existing
contractual relation.44
As a general rule, any act or omission coming under
the purview of Article 2176 gives rise to a cause of
action under quasi-delict. This, in turn, gives the basis
for a claim of damages.45 Notably, quasi-delict is one
among several sources of obligation. Article 1157 of
the Civil Code states:
Article 1157. Obligations arise from:
(1) Law;
(2) Contracts;
(3) Quasi-contracts;
(4) Acts or omissions punished by law; and
(5) Quasi-delicts.
However, as explained by Associate Justice Marvic
M.V.F. Leonen (Justice Leonen) in his opinion in Alano
v. Magud-Logmao46 (Alano), "Article 2176 is not an
all-encompassing enumeration of all actionable
wrongs which can give rise to the liability for
damages. Under the Civil Code, acts done in
violation of Articles 19, 20, and 21 will also give rise
to damages."47 These provisions - which were cited as
bases by the MTC, RTC and CA in their respective
rulings in this case - read as follows:
Article 19. Every person must, in the exercise of his
rights and in the performance of his duties, act with
justice, give everyone his due, and observe honesty
and good faith.
Article 20. Every person who, contrary to law, willfully
or negligently causes damage to another, shall
indemnify the latter for the same.
Article 21. Any person who willfully causes loss or
injury to another in a manner that is contrary to morals,
good customs, or public policy shall compensate the
latter for the damage.
"[Article 19], known to contain what is commonly
referred to as the principle of abuse of rights, sets
certain standards which must be observed not only in
the exercise of one's rights, but also in the performance
of one's duties."48 Case law states that "[w]hen a right
is exercised in a manner which does not conform with
the norms enshrined in Article 19 and results in
damage to another, a legal wrong is thereby committed
for which the wrongdoer must be held responsible. But
while Article 19 lays down a rule of conduct for the
government of human relations and for the
maintenance of social order, it does not provide a
remedy for its violation. Generally, an action for
damages under either Article 20 or Article 21 would
[then] be proper."49 Between these two provisions as
worded, it is Article 20 which applies to both willful and
negligent acts that are done contrary to law. On the
other hand, Article 21 applies only to willful acts
done contra bonos mores.50
In the Alano case, Justice Leonen aptly elaborated on
the distinctive applications of Articles 19, 20 and 21,
which are general provisions on human relations, vis-
a-vis Article 2176, which particularly governs quasi-
delicts:
Article 19 is the general rule which governs the conduct
of human relations. By itself, it is not the basis of an
actionable tort. Article 19 describes the degree of care
required so that an actionable tort may arise when it is
alleged together with Article 20 or Article 21.
Article 20 concerns violations of existing law as
basis for an injury. It allows recovery should the act
have been willful or negligent. Willful may refer to the
intention to do the act and the desire to achieve the
outcome which is considered by the plaintiff in tort
action as injurious. Negligence may refer to a situation
where the act was consciously done but without
intending the result which the plaintiff considers as
injurious.
Article 21, on the other hand, concerns injuries that
may be caused by acts which are not necessarily
proscribed by law. This article requires that the act be
willful, that is, that there was an intention to do the act
and a desire to achieve the outcome. In cases under
Article 21, the legal issues revolve around whether
such outcome should be considered a legal injury on
the part of the plaintiff or whether the commission of
the act was done in violation of the standards of care
required in Article 19.
Article 2176 covers situations where an injury
happens through an act or omission of the defendant.
When it involves a positive act, the intention to commit
the outcome is irrelevant. The act itself must not be
a breach of an existing law or a pre-existing
contractual obligation. What will be considered is
whether there is "fault or negligence” attending the
commission of the act which necessarily leads to the
outcome considered as injurious by the plaintiff. The
required degree of diligence will then be assessed in
relation to the circumstances of each and every
case.51 (Emphases and underscoring supplied)
Thus, with respect to negligent acts or omissions, it
should therefore be discerned that Article 20 of the
Civil Code concerns "violations of existing law as
basis for an injury", whereas Article 2176 applies
when the negligent act causing damage to another
does not constitute "a breach of an existing law or
a pre-existing contractual obligation."
In this case, the courts a quo erroneously anchored
their respective rulings on the provisions of Articles 19,
207
20, and 21 of the Civil Code. This is because
respondent did not proffer (nor have these courts
mentioned) any law as basis for which damages may
be recovered due to petitioner's alleged negligent act.
In its amended complaint, respondent mainly avers
that had petitioner not issue a "fit for employment"
Medical Report to Raguindin, respondent would not
have processed his documents, deployed him to Saudi
Arabia, and later on - in view of the subsequent findings
that Raguindin was positive for HCV and hence, unfit
to work - suffered actual damages in the amount of
P84,373.41.52Thus, as the claimed negligent act of
petitioner was not premised on the breach of any law,
and not to mention the incontestable fact that no pre-
existing contractual relation was averred to exist
between the parties, Article 2176 - instead of Articles
19, 20 and 21 - of the Civil Code should govern.
III.
Negligence is defined as the failure to observe for the
protection of the interests of another person, that
degree of care, precaution and vigilance which the
circumstances justly demand, whereby such other
person suffers injury.53
As early as the case of Picart v. Smith,54 the Court
elucidated that "the test by which to determine the
existence of negligence in a particular case is: Did the
defendant in doing the alleged negligent act use
that reasonable care and caution which an
ordinarily prudent person would have used in the
same situation? If not, then he is guilty of
negligence."55 Corollary thereto, the Court stated that
"[t]he question as to what would constitute the conduct
of a prudent man in a given situation must of course be
always determined in the light of human experience
and in view of the facts involved in the particular
case. Abstract speculation cannot here be of much
value x x x: Reasonable men govern their conduct by
the circumstances which are before them or known to
them. They are not, and are not supposed to be,
omniscient of the future. Hence[,] they can be
expected to take care only when there is something
before them to suggest or warn of danger."56
Under our Rules of Evidence, it is disputably presumed
that a person takes ordinary care of his concerns and
that private transactions have been fair and
regular.57 In effect, negligence cannot be
presumed, and thus, must be proven by him who
alleges it.58 In Huang v. Philippine Hoteliers, Inc.:59
[T]he negligence or fault should be clearly established
as it is the basis of her action. The burden of proof is
upon [the plaintiff]. Section 1, Rule 131 of the Rules of
Court provides that "burden of proof is the duty of a
party to present evidence on the facts in issue
necessary to establish his claim or defense by the
amount of evidence required by law." It is then up for
the plaintiff to establish his cause of action or the
defendant to establish his defense. Therefore, if the
plaintiff alleged in his complaint that he was
damaged because of the negligent acts of the
defendant, he has the burden of proving such
negligence. It is even presumed that a person takes
ordinary care of his concerns. The quantum of proof
required is preponderance of evidence.60 (Emphasis
and underscoring supplied)
The records of this case show that the pieces of
evidence mainly relied upon by respondent to establish
petitioner's negligence are: (a) the Certification61 dated
April 28, 2008; and (b) the HCV Confirmatory Test
Report.62 However, these issuances only indicate the
results of the General Care Dispensary and Ministry of
Health's own medical examination of Raguindin finding
him to be positive for HCV. Notably, the examination
conducted by the General Care Dispensary, which was
later affirmed by the Ministry of Health, was
conducted only on March 24, 2008, or at least two
(2) months after petitioner issued its Medical
Report on January 11, 2008. Hence, even assuming
that Raguindin's diagnosis for HCV was correct, the
fact that he later tested positive for the same does not
convincingly prove that he was already under the same
medical state at the time petitioner issued the Medical
Report on January 11, 2008. In this regard, it was
therefore incumbent upon respondent to show
that there was already negligence at the time the
Medical Report was issued, may it be through
evidence that show that standard medical procedures
were not carefully observed or that there were already
palpable signs that exhibited Raguindin's unfitness for
deployment at that time. This is hardly the case when
respondent only proffered evidence which
demonstrate that months after petitioner's Medical
Report was issued, Raguindin, who had already been
deployed to Saudi Arabia, tested positive for HCV and
as such, was no longer "fit for employment".
In fact, there is a reasonable possibility that Raguindin
became exposed to the HCV only after his medical
examination with petitioner on January 11, 2008.
Based on published reports from the World Health
Organization, HCV or the hepatitis C virus causes both
acute and chronic infection. Acute HCV infection is
usually asymptomatic,63 and is only very rarely
associated with life-threatening diseases.
The incubation period64 for HCV is two (2) weeks to
six (6) months, and following initial infection,
approximately 80% of people do not exhibit any
symptoms.65 Indisputably, Raguindin was not
deployed to Saudi Arabia immediately after petitioner's
medical examination and hence, could have possibly
contracted the same only when he arrived thereat. In
light of the foregoing, the CA therefore erred in holding
that "[h]ad petitioner more thoroughly and diligently
examined Raguindin, it would likely have discovered
the existence of the HCV because it was contrary to
human experience that a newly-deployed overseas
worker, such as Raguindin, would immediately have
contracted the disease at the beginning of his
deployment"66
While petitioner's Medical Report indicates an
expiration of April 11, 2008, the Court finds it fitting to
clarify that the same could not be construed as a
certified guarantee coming from petitioner that
Raguindin's medical status at the time the report was
issued on January 11, 2008 (i.e., that he was fit for
employment) would remain the same up until that date
(i.e., April 11, 2008). As earlier intimated, the
intervening period could very well account for a number
of variables that could have led to a change in
Raguindin's condition, such as his deployment to a
different environment in Saudi Arabia. If at all, the
expiration date only means that the Medical Report is
valid - and as such, could be submitted - as a formal
requirement for overseas employment up until April 11,
2008; it does not, by any means, create legal basis to
hold the issuer accountable for any intervening change
of condition from the time of issuance up until
expiration. Truly, petitioner could not be reasonably
expected to predict, much less assure, that Raguindin's
medical status of being fit for employment would
remain unchanged. Thus, the fact that the Medical
Report's expiration date of April 11, 2008 was only
seventeen (17) days away from the issuance of the
General Care Dispensary's April 28, 2008 Certification
208
 finding Raguindin positive for HCV should not - as it
does not - establish petitioner's negligence.
IV.
At any rate, the fact that Raguindin tested positive for
HCV could not have been properly established since
the courts a quo, in the first place, erred in admitting
and giving probative weight to the Certification of the
General Care Dispensary, which was written in an
unofficial language. Section 33, Rule 132 ofthe Rules
of Court states that:
Section 33. Documentary evidence in an unofficial
language. - Documents written in an unofficial
language shall not be admitted as evidence, unless
accompanied with a translation into English or
Filipino. To avoid interruption of proceedings, parties
or their attorneys are directed to have such translation
prepared before trial.67
A cursory examination of the subject document would
reveal that while it contains English words, the majority
of it is in an unofficial language. Sans any translation in
English or Filipino provided by respondent, the same
should not have been admitted in evidence; thus their
contents could not be given probative value, and
deemed to constitute proof of the facts stated therein.
Moreover, the due execution and authenticity of the
said certification were not proven in accordance with
Section 20, Rule 132 of the Rules of Court:
Section 20. Proof of private document. - Before any
private document offered as authentic is received in
evidence, its due execution and authenticity must be
proved either:
(a) By anyone who saw the document executed or
written; or
(b) By evidence of the genuineness of the signature or
handwriting of the maker.
(c)
Any other private document need only be identified
as that which it is claimed to be.
Notably, the foregoing provision applies since the
Certification does not fall within the classes of public
documents under Section 19, Rule 132 of the Rules of change of emphasis from one phase of the case as
Court68 - and hence, must be considered as private. It presented by one set of facts to another phase made
has been settled that an unverified and unidentified prominent by another set of facts x x x does not result
private document cannot be accorded probative in a change of theory x x x".78 In any case, petitioner
value.69 In addition, case law states that "since a had already questioned the validity of these documents
medical certificate involves an opinion of one who in its Position Paper79 before the MeTC.80 Hence, there
must first be established as an expert witness, it is no change of theory that would preclude petitioner's
cannot be given weight or credit unless the doctor arguments on this score.
who issued it is presented in court to show his
qualifications. It is precluded because the party All told, there being no negligence proven by
respondent through credible and admissible evidence,
against whom it is presented is deprived of the right
petitioner cannot be held liable for damages under
and opportunity to cross-examine the person to whom
the statements or writings are attributed. Its executor Article 2176 of the Civil Code as above-discussed.
or author should be presented as a witness to provide
WHEREFORE, the petition is GRANTED. Accordingly,
the other party to the litigation the opportunity to
the Decision dated July 11, 2014 and the Resolution
question its contents. Being mere hearsay evidence,
dated February 27, 2015 of the Court of Appeals in CA-
failure to present the author of the medical certificate
G.R. SP No. 125451 are REVERSEDand SET ASIDE,
renders its contents suspect and of no probative
and a NEW ONE is entered, DISMISSING the
value,"70 as in this case.
complaint of respondent LWV Construction
Similarly, the HCV Confirmatory Test Report issued by Corporation for lack of merit.
the Ministry of Health of Saudi Arabia should have also
SO ORDERED.
been excluded as evidence. Although the same may
be considered a public document, being an alleged Carpio (Chairperson), Peralta, Caguioa, and Reyes,
written official act of an official body of a foreign Jr., JJ., concur.
country,71 the same was not duly authenticated in
accordance with Section 24,72 Rule 132 of the Rules of Endnotes:
Court. While respondent provided a
translation73 thereof from the National Commission on
Muslim Filipinos, Bureau of External Relations, Office
1Rollo,
of the President, the same was not accompanied by a pp. 7-27.
certificate of the secretary of the embassy or legation, 2
consul-general, consul, vice-consul, or consular agent Id. at 28-37. Penned by Associate Justice Jane
or any officer in the foreign service of the Philippines Aurora C. Lantion with Associate Justices Vicente S.E.
stationed in Saudi Arabia, where the record is kept, and Veloso and Nina G. Antonio-Valenzuela concurring.
authenticated by the seal of his office.74 3 Id. at 47-48.
To be sure, petitioner - contrary to respondent's 4CA rollo, pp. 34-40. Penned by Presiding Judge
contention75 - has not changed its theory of the case by
Ofelia L. Calo.
questioning the foregoing documents. As petitioner
correctly argued, it merely amplified its defense76that it 5Rollo, p. 29.
is not liable for negligence when it further questioned
the validity of the issuances of the General Care 6 Id.
Dispensary and Ministry of Health. In Limpangco Sons
7
v. Yangco77, the Court explained that "[t]here is a See CA rollo, p. 68. See also Referral Slip for Medical
difference x x x between a change in the theory of the Examination; id. at 73.
case and a shifting of the incidence of the emphasis 8 Id. at 74.
placed during the trial or in the briefs." "Where x x x the
theory of the case as set out in the pleadings remains 9 Id. at 69.
the theory throughout the progress of the cause, the
209
10 28
Id. See id. at 38. (2) but which is contrary to morals, good custom, public
order or public policy; and (3) is done with intent to
11 29
Id. at 69-70. Dated February 15, 2012. Id. at 141-148. injure." (Mata v. Agravante, 583 Phil. 64, 70 [2008])
12 30
Id. at 75. Id. at 41-42. 51Alano v. Magud-Logmao, supra note 45 at 433-434.
13 31
Id. at 76. See Petition for review dated July 19, 2012; id. at 6- 52 CA rollo, p. 70.
33.
14 See id. at 70. 53Mendoza v. Spouses Gomez, 736 Phil. 460, 474
32Rollo, pp. 28-37. (2014); citation omitted.
15 See Amended Complaint dated December 2, 2008;
33
id. at 68-72. Id. at 36-37. 54 37 Phil. 809 (1918).
16 34
Id. at 70-71. Id. at 34. 55 Id. at 83.
17 35
Dated February 1, 2010; id. at 84-89. Id. at 34-35. 56 Id.
18 36
Id. at 85-86. Id. at 35 57 See Revised Rules of Evidence, Rule 131, Section
19 37 3 (p).
Id. at 113-117. Penned by Assisting Judge Bonifacio Id.
S. Pascua. 58See Samsung Construction Company of the
38 See id. at 36.
20 Philippines, Inc. v. Far East Bank and Trust Company,
Id. at 117.
39 Dated August 18, 2014. Id. at 38-46. 480 Phil. 39, 58 (2004); citations omitted.
21 Id. at 116. 59
40 Id. at 47-48. 700 Phil. 327 (2012).
22 Id. at 117. 60
41Maersk-Filipinas Crewing, Inc. v. Vestruz, 754 Phil. Id. at 358-359; citations omitted.
23 Id. 307, 317 (2015), citing Jao v. BCC Products Sales, 61 CA rollo, p. 75.
Inc., 686 Phil. 36, 41 (2012).
24See Memorandum dated July 12, 2011; id. at 118- 62
42New Id. at 76.
132. City Builders, Inc. v. NLRC, 499 Phil. 207, 213
(2005). 63 Asymptomatic has been defined as "without
25 Section 24. Proof of official record. - The record of
43Maersk-Filipinas symptoms; providing no subjective evidence of
public documents referred to in paragraph (a) of Crewing, Inc. v. Vestruz, supra note
existence" (see <
section 19, when admissible for any purpose, may be 41 at 317-318.
https://www.collinsdictionary.com/dictionary/english/a
evidenced by an official publication thereof or by a copy
44See Garcia, Jr. v. Salvador, 547 Phil. 463, 470 symptomatic > [visited October 26, 2017]) or "having or
attested by the officer having the legal custody of the
(2007) showing no symptoms of disease" (see <
record, or by his deputy, and accompanied, if the
https://www.merriam-webster.com/dictionary/
record is not kept in the Philippines, with a certificate 45 See Concurring Opinion of Justice Leonen in Alano asymptomatic > [visited October 26, 2017]).
that such officer has the custody. If the office in which
v. Magud-Logmao, 731 Phil. 407, 430 (2014).
the record is kept is in a foreign country, the certificate 64 Incubation period has been defined as "the time
may be made by a secretary of the embassy or 46 Id. between exposure to an infectious disease and the
legation, consul-general, consul, vice-consul, or appearance of the first signs or symptoms" (see <
consular agent or by any officer in the foreign service 47 Id. https://www.collinsdictionary.com/dictionary/
of the Philippines stationed in the foreign country in english/incubation-period > [visited October 26, 2017])
48Globe
which the record is kept, and authenticated by the seal Mackay Cable and Radio Corporation v. CA, or "the period between the infection of an individual by
of his office. 257 Phil. 783, 788 (1989). a pathogen and the manifestation of the illness or
26 49 Id. at 784. disease it causes" (see < https://www.merriam-
CA rollo, pp. 34-40.
webster.com/ dictionary/incubation%20period >
27 Id. at 40. 50"Article 21 refers to acts contra bonos mores and [visited October 26, 2017]).
has the following elements: (1) an act which is legal;

210
65 76
World Health Organization Fact Sheet on Hepatitis See id. at 87-88. dated June 27, 2014, both in CA-G.R. CV No. 99179.
C, updated July 2017; see < The assailed Decision reversed and set aside the
77
http://www.who.int/mediacentre/factsheets/fs164/en/ > 34 Phil. 597 (1916). Decision of the Regional Trial Court (RTC), Makati
(visited October 26, 2017). Emphasis supplied. 78 City, Branch 59, dated November 21, 2011, in Civil
Id. at 607-608.
Case No. 96-1372. The assailed Resolution,
66 Id. 79 meanwhile, denied petitioner’s Motion for
Dated October 25, 2010; CA rollo, pp. 92-96.
67 Reconsideration.
Emphasis and underscoring supplied. 80 Id. at 95.
68 The Facts
Public documents are:

(a) The written official acts, or records of the official

acts of the sovereign authority, official bodies and
tribunals, and public officers, whether of the
Philippines, or of a foreign country;
(b) Documents acknowledged before a notary public
except last wills and testaments; and
(c) Public records, kept in the Philippines, of private
documents required by law to be entered therein. All
other writings are private.
69Huang v. Philippine Hoteliers, Inc., supra note 59 at
367.
70
Id. See also Maritime Factors, Inc. v. Hindang, 675
Phil. 587 (2011).
71Rollo, p. 12.
72
Section 24. Proof of official record. - The record of
public documents referred to in paragraph (a) of
section 19, when admissible for any purpose, may be
evidenced by an official publication thereof or by a copy
attested by the officer having the legal custody of the
record, or by his deputy, and accompanied, if the
record is not kept in the Philippines, with a certificate
that such officer has the custody. If the office in which
the record is kept is in a foreign country, the certificate
may be made by a secretary of the embassy or
legation, consul-general, consul, vice-consul, or
consular agent or by any officer in the foreign service
of the Philippines stationed in the foreign country in
which the record is kept, and authenticated by the seal
of his office.
73 CA rollo, p. 254.
74 See rollo, pp. 13-14.
75See Explanation to Show Cause and Comment
dated January 27, 2017; id. at 65-70.
Petitioner Bliss Development Corporation (BDC)
(subsequently reorganized as Home Guaranty
Corporation) is the registered owner of Lot No. 27,
Block 30, New Capitol Estates I, Brgy. Matandang
Balara, Diliman, Quezon City, and covered by Transfer
Certificate of Title (TCT) No. 331582. On October 19,
1984, it entered into and executed a Deed of Sale over
the said property in favor of Spouses Emiliano and
Leonila Melgazo (Sps. Melgazo), both of whom are
now deceased.2redarclaw
On May 7, 1991, a certain Rodolfo Nacua (Nacua) sent
a letter to BDC, saying that Sps. Melgazo transferred
to him their rights over the property. He further
expressed willingness to pay the outstanding
obligations of Sps. Melgazo to BDC. Before the
property was fully paid, however, Nacua sold his rights
to Olivia Garcia (Garcia), through a Deed of Transfer of
Rights. Later, Garcia transferred her rights to Elizabeth
Reyes (Reyes). Reyes then transferred her rights to
Domingo Tapay (Tapay), who then later sold his rights
to herein respondent Montano Diaz (Diaz) for Six
Hundred Thousand Pesos (P600,000.00). Diaz then
paid BDC the amortizations due on the property,
G.R. No. 213233, August 05, 2015
amounting to P406,915.15, and BDC issued a permit
BLISS DEVELOPMENT CORP./HOME GUARANTY to occupy the property in favor of Diaz. Diaz then
CORPORATION, Petitioner, v. MONTANO DIAZ, introduced improvements on the property, amounting
DOMINGO TAPAY, AND EDGAR H. to P700,000.00.
ARREZA, Respondents.
On April 14, 1992, BDC executed a Contract to Sell in
DECISION favor of Diaz.3 On April 15, 1994, however, BDC
informed Diaz that respondent Edgar Arreza (Arreza)
VELASCO JR., J.:
was claiming that the heirs of Sps. Melgazo sold to him
The Case the rights over the property.4 BDC then placed Diaz’s
account in “inactive status.” To resolve the conflicting
claims of Arreza and Diaz, BDC filed a complaint for
This is a Petition for Review on Certiorari assailing the Interpleader against them, before the RTC, Makati
Decision1 of the Court of Appeals (CA), promulgated City, Branch 146. On March 27, 1996, the Makati City
on January 21, 2014, and its subsequent Resolution RTC Branch 146 ruled that the signatures of Sps.
211
Melgazo transferring their rights to Nacua were mere
forgeries. Thus, it ruled that Arreza had a better right
over the property. This decision became final and
executory.5redarclaw
On August 27, 1996, Diaz filed the present complaint
for sum of money against BDC before the RTC, Makati
City, Branch 59.6 This was later amended to include
Arreza and Tapay as defendants. Diaz argued that
BDC and Tapay’s representations led him to believe
that he had a good title over the property, but due to
the court’s ruling in the interpleader case, he was
constrained to transfer the property to Arreza. Thus, he
prayed for the following:LawlibraryofCRAlaw
(1) For BDC and Arreza to pay him P1,106,915.58, plus
interest, representing the amount he paid for the
assumption of Tapay’s rights;
(2) For Tapay to pay him P600,000.00, plus interests,
representing the amount he paid Tapay;
(3) For BDC and Tapay to pay him P500,000.00 as
moral damages;
(4) For BDC to pay him P500,000 as exemplary
damages; and
(5) For BDC, Tapay, and Arreza to pay him P100,000
as attorney’s fees and costs of suit.7
Both BDC and Tapay argued that their respective acts
were lawful and done in good faith.Arreza filed a
Motion to Dismiss, citing res judicata, arguing that the
claim of Diaz is a compulsory counterclaim that should
have been pleaded in the Interpleader case. The RTC
denied the Motion to Dismiss, which the CA, on
certiorari, affirmed. When the issue reached this Court
in G.R. No. 133113,8 this Court ruled that the claim as
against Arreza is barred by res judicata. The Court
upheld the argument that the claim is in the nature of a
compulsory counterclaim. Thus, the case against
Arreza was dismissed.
The Decision of the RTC
After trial, the RTC rendered its Decision on November
21, 2011, finding that Diaz failed to prove that he is an
assignee in good faith, and thus dismissed the
complaint for lack of merit in this
wise:LawlibraryofCRAlaw
Plaintiff must show that he inquired not only into the
title of the assignor but also into the assignor’s capacity
to convey. The failure of plaintiff to diligently inquire as
such, indicated that he is not an assignee in good faith.
Plaintiff Diaz downplays the need to extend his
examination to intervening transferor farther than
Domingo Tapay from whom he acquired the subject
property. Such attitude, however, is not in accord with
what a reasonably prudent person would do under the
circumstances.
x x x x
WHEREFORE, premises considered, plaintiff’s
Complaint is hereby DISMISSED for lack of merit.
Defendant Domingo Tapay’s [counterclaim] is likewise
dismissed. No costs.9
Aggrieved, Diaz appealed to the CA.
The Decision of the CA
In its presently assailed Decision promulgated on
January 21, 2014, the CA reversed the ruling of the
RTC and, instead,ruled that Diaz is entitled to be paid
reimbursement and damages. The CA anchored its
ruling on its finding that Diaz is both a buyer in good
faith and a builder in good faith,
thus:LawlibraryofCRAlaw
A careful examination of the records convinces Us that
Diaz is both a buyer and builder in good faith. We note
that while Bliss executed a Deed of Sale with Mortgage
in favor of the spouses Emiliano and Leonila Melgazo,
title over the property was in Bliss’ name. The title
remained in Bliss’ name when Tapay offered to transfer
his rights over the property to Diaz. Considering that
the property involved is registered land, Diaz need not
go beyond the title to be considered a buyer in good
faith. Indeed, after Diaz accepted Tapay’s offer, he
dealt directly with Bliss which received the monthly
amortizations due on the property. For almost three
years, from 1991 to 1994, Bliss accepted Diaz’s
payment without informing Diaz of Arreza’s conflicting
claim over the property. Bliss even issued Diaz a permit
to occupy the property in 1992; thus, allowing Diaz to
introduce improvements on the property. In other
words, at the time when Diaz purchased the property
from Tapay and when he introduced the
improvements, he had no notice that some other
person has a right over the property. He also had a
well-founded belief that the property he was building on
was his. Accordingly, Diaz is a buyer and builder in
good faith.10
In ruling that Diaz is a buyer in good faith, the CA noted
that Diaz need not go beyond the title to be considered
a buyer in good faith, because what is involved is a
registered land.
With regard to the liability of BDC, the CA ruled that the
provision in the Contract to Sell excusing it from
reimbursing the monthly amortizations to Diaz cannot
exempt it from liability, because it acted in bad faith.
The CA said:LawlibraryofCRAlaw
Next, Bliss’ argument that the Additional Provision in
the Contract to Sell excuses it from reimbursing the
monthly amortizations paid by Diaz cannot be given
credence. Any stipulation exempting the vendor from
the obligation to answer for eviction shall be void, if he
acted in bad faith. The vendor’s bad faith consists in
his knowledge beforehand at the time of the sale, of the
presence of the fact giving rise to eviction, and its
possible consequence. It is undisputed that Bliss knew
about Arreza’s claim in 1991. It even received
amortization payments from Arreza. Yet, Bliss is aware
that should Arreza pursue his claim in court, Diaz may
be evicted from the property. Yet, Bliss only informed
Diaz about Arreza’s claim in 1994 when Arreza
followed up his claim. Indubitably, Bliss acted in bad
faith in dealing with Diaz and should not be absolved
from liability by the Additional Provision in the Contract
to Sell.11
Thus, the CA dispositively held:LawlibraryofCRAlaw
FOR THESE REASONS, the November 21, 2011
Decision of the Regional Trial Court of Makati City,
Branch 59, is SET ASIDE. The Court hereby
DIRECTS: (1) Defendant-appellee Bliss Development
Corporation/Home Guaranty Corporation
212
to PAY plaintiff-apellant Montano Diaz P1,106,915.58
for the amortizations paid and amount spent on
improvements on the property, P100,000.00 as moral
damages, P50,000.00 as exemplary damages, and
P25,000.00 as attorney’s fee; and (2) defendant-
appellee Domingo Tapay to PAY plaintiff-appellant
Montano M. Diaz P600,000.00, the amount he paid for
the transfer of rights.
Petitioner BDC moved for reconsideration, insisting
that Diaz cannot be declared a buyer in good faith, in
light of the March 27, 1996 Decision of the Makati City
RTC, Branch 146 in the Interpleader case, which had
long been final and executory. Tapay also moved for
reconsideration, arguing that he was not aware of the
defect in the title sold to Diaz, and, hence, he should
not be made liable for the P600,000.00 that Diaz paid
to him. In the CA’s assailed Resolution dated June 27,
2014,12 the CA denied both motions for
reconsideration.
Hence, the present Petition for Review on Certiorari
filed by BDC, raising the following
issues:LawlibraryofCRAlaw
I.
WHETHER THE CA ERREDIN NOT DISMISSING
THE APPEAL, IN VIEW OF THE APPLICATION OF
THE DOCTRINE OF IMMUTABILITY OF JUDGMENT
IN THE DECISION OF THE COURT IN G.R. NO.
133113
II.
WHETHER THE CA ERRED IN DECLARING BDC IN
BAD FAITH
III.
WHETHER THE CA ERRED IN DECLARING THAT
THERE WAS UNJUST ENRICHMENT ON THE PART
OF BDC
IV.
In cases involving res adjudicata, the parties and the
WHETHER DIAZ CAN STILL CLAIM causes of action are identical or substantially the same
REIMBURSEMENT EVEN IF UNDER THE in the prior as well as the subsequent action. The
CONTRACT, HIS POSSESSION IS IN THE NATURE judgment in the first action is conclusive as to every
OF A LESSOR matter offered and received therein and as to any other
matter admissible therein and which might have been
V. offered for that purpose, hence said judgment is an
absolute bar to a subsequent action for the same
cause.The bar extends to questions necessarily
WHETHER BDC IS LIABLE TO REIMBURSE DIAZ OF
involved in an issue, and necessarily adjudicated, or
THE AMOUNT OF P1,106,915.58
necessarily implied in the final judgment, although no
specific finding may have been made in reference
thereto, and although such matters were directly
In fine, petitioner argues that it is not liable to
referred to in the pleadings and were not actually or
respondent Diaz, both for the amortizations that Diaz
formally presented. Said prior judgment is
paid to it, and the value of the improvements that Diaz
conclusive in a subsequent suit between the same
introduced to the property.
parties on the same subject matter, and on the
same cause of action, not only as to matters which
Meanwhile, Tapay failed to elevate before this Court
were decided in the first action, but also as to every
the CA’s ruling against him.
other matter which the parties could have properly set
The Court’s Ruling up in the prior suit.13 (emphasis added)
The petition is partially granted. The CA committed In the case at bar, We find that the essential elements
reversible error in ruling that Diaz was a buyer in good of res judicata are not present. First, the interpleader
faith and for value. Nevertheless, BDC is liable to Diaz case was between Arreza and Diaz. While it was BDC
because it acted in bad faith, as discussed below. that initiated the interpleader case, the opposing
parties in that prior case is, in fact, Arreza and
The claim is not barred by the Diaz. Second, the issues resolved in the interpleader
doctrine of immutability of judgment case revolved around the conflicting claims of Arreza
and Diaz, and not whatever claim either of them may
First, We dispose of the issue of the applicability of the have against BDC. Thus, there is no identity of parties,
doctrine of immutability of judgment, in view of the nor identity of subject matter, between the interpleader
ruling of this Court in G.R. No. 133113. We find that the case and the one at bar.
present claim is not barred by the court’s ruling in G.R.
No. 133113––to the effect that Diaz can no longer Petitioner BDC acted in bad faith
claim reimbursement from Arrezabecause of res in dealing with respondent Diaz
judicata––for his failure to allege the claim in the
interpleader case between them. On the second issue, We find that the CA committed
no reversible error in finding that BDC acted in bad
In G.R. No. 133113, We ruled that the claim against faith, when it allowed Diaz to take over the payment of
Arreza is barred by res judicata, because of a prior the amortizations over the subject property. As the CA
Interpleader case between Arreza and Diaz. We ruled correctly noted, “It is undisputed that Bliss knew about
Arreza’s claim in 1991. It even received amortization
that the claim for reimbursement should have been
payments from Arreza. Yet, Bliss acknowledged the
alleged and proved in the prior case, and failure to do
transfer to Diaz and received the monthly amortizations
so bars any future action on such claims. We reiterated
the rule on res judicata, thus:LawlibraryofCRAlaw paid by Diaz. Also, Bliss is aware that should Arreza
pursue his claim in court, Diaz may be evicted from the
property.”14redarclaw
213

BDC anchors its claim of good faith on the fact that it
did not act as seller to Diaz. Rather, BDC claims, it was
Diaz who came forward and presented himself to BDC
as the lawful successor-in-interest of Emiliano and
Leonila Melgazo, by virtue of the several deeds of
transfer of rights, all of which he presented to BDC. It
was on the basis of this claim that BDC allowed Diaz
to occupy the property and pay amortizations accruing
over the property.15redarclaw
Nevertheless, BDC does not dispute that as early as
1991, even before respondent came forward
presenting the deeds of transfer to BDC, BDC was
already aware of the claim of Arreza. In fact, it even
received amortizations from Arreza. Despite this, BDC
also later acknowledged the transfer to Diaz, and also
accepted amortizations from him.16 This
uncontroverted sequence of events led the CA to
correctly rule that BDC, indeed, acted in bad faith.
When Diaz came forward and presented the deeds of
transfer, including the deed of transfer executed by
Tapay in his favor, BDC was already well aware of a
conflicting claim by Arreza. Instead of waiting for the
resolution on the matter, BDC immediately accepted
the deed of transfer presented by Diaz, as well as the
amortizations he paid over the property. It was only in
1994 that BDC filed the Interpleader case to resolve
the conflicting case. This is nothing short of evident bad
faith.
Respondent Diaz is not a purchaser
for value and in good faith
We,however, fail to find sufficient basis for the CA’s
ruling that Diaz is a purchaser for value and in good
faith. In a long line of cases, this Court had ruled that a
purchaser in good faith and for value is one who buys
property of another without notice that some other
person has a right to, or interest in, such property and
pays full and fair price for the same at the time of such
purchase or before he or she has notice of the claim or
interest of some other person in the property.17For one
to be considered a purchaser in good faith, the
following requisites must concur: (1) that the purchaser
buys the property of another without notice that some
other person has a right to or interest in such property;
and (2) that the purchaser pays a full and fair price for
the property at the time of such purchase or before he
or she has notice of the claim of another.18 We find that
in the case at bar, the first element is lacking.
The CA, in disposing the issue of Diaz’s good faith,
merely said that “considering that the property involved
is registered land, Diaz need not go beyond the title to
be considered a buyer in good faith.”19We find this to
be a serious and reversible error on the part of the CA.
In the first place, while it is true that the subject lot is
registered lot, the doctrine of not going beyond the face
of the title does not apply in the case here, because
what was subjected to a series of sales was not the lot
itself but the right to purchase the lot from BDC. The
CA itself observed: “while [BDC] executed a Deed of
Sale with Mortgage in favor of the spouses Emiliano
and Leonila Melgazo, title over the property was in
[BDC’s] name. The title remained in [BDC’s] name
when Tapay offered to transfer his rights over the
property to Diaz.”20Notably, the several transfers
themselves did not purport to be Deeds of Absolute
Sale, but merely deeds of assignment of rights. The
subject of those deeds of assignment was never the
real right over the subject property, but merely the
personal right to purchase it. Therefore, the mirror
doctrine finds no application in the case at bar.
A careful review of the records of this case reveals that
Diaz, in fact, failed to diligently inquire into the title of
his predecessor before entering into the contract of
sale. As such, he cannot be considered a buyer in good
faith. There is no issue that despite the several
transfers of rights from Nacua to Garcia to Reyes to
Tapay to Diaz, title over the property remained in
BDC’s name.When Diaz transacted with Tapay, it was
also clear that what was being transferred was merely
rights to purchase the property, and not title over the
lot itself; if it were, the sale would have been void
because Tapay never had ownership over the subject
property. As the buyer in such a transaction, it was
incumbent upon Diaz not only to inquire as to the right
of Tapay to transfer his rights, but also to trace the
source of that right to purchase the property. Had he
discharged this duty diligently, he would have found out
that Nacua’s right was without basis, because it was
founded on a forged deed. For his failure to inquire
diligently and trace the source of the right to purchase
the property, Diaz cannot claim to be a purchaser in
good faith and for value.
Petitioner BDC is liable to return the
amortizations paid by respondent Diaz,
under the doctrine of unjust enrichment
Notwithstanding the fact that Diaz is not an innocent
purchaser in good faith and for value, BDC is
nevertheless liable to return to him the amortizations
which he already paid on the property, applying the rule
on unjust enrichment.
Unjust enrichment exists 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. Under Article 22 of the Civil Code,21 there
is unjust enrichment when (1) a person is unjustly
benefited and (2) such benefit is derived at the
expense of or with damages to another.22redarclaw
Allowing BDC to keep the amortizations paid by Diaz is
tantamount to unjust enrichment. It would result in BDC
receiving amortizations twice the amount it should
have received, that is, the amortizations paid by Diaz
and Arreza. While BDC claims that it did not receive
amortizations from both Diaz and Arreza covering the
same period, such a claim is self-serving, and is not
amply supported by any documentary evidence.
Even if BDC can prove that there was no overlap
between the payments made by Diaz and those made
by Arreza, allowing it to keep the amortizations paid by
Diaz still amounts to unjust enrichment. As a direct
result of the final and executory ruling that Arreza is the
rightful buyer of the subject property, the buyer-seller
relationship between Diaz and BDC is rendered null
and void. Consequently, there remains no valid
consideration whatsoever for the payments made by
Diaz to BDC. There being no indication of intent to
donate, because such payments were made under the
impression that Diaz is the rightful buyer of the
property, it is only but just that Diaz be allowed to claim
back what he has paid. This is only a natural
consequence of the final and executory ruling that Diaz
is not the rightful buyer of the subject property. Allowing
BDC to keep such payments, at the expense of and to
the damage of Diaz, still amounts to unjust enrichment.
Both parties being in bad faith,
214
BDC is liable to Diaz for the value but he may remove the ornaments with which he has amortizations paid and the amount spent on
of the improvements he introduced embellished the principal thing if it suffers no injury improvements on the property; and (2) Domingo Tapay
on the subject property thereby, and if his successor in the possession does is ordered to pay respondent Montano M. Diaz the
not prefer to refund the amount expended. amount of P600,000.00, the amount he paid for the
Next, We resolve the issue of whether BDC is liable to transfer of rights.
Diaz for the value of the improvements that Diaz
introduced to the property. Arts. 448, 453, 546, and 548 The CA may have made the erroneous conclusion that SO ORDERED.
of the Civil Code are material in resolving the Diaz acted in good faith, but because BDC equally
issue:LawlibraryofCRAlaw acted in bad faith, Art. 453 of the Civil Code commands Peralta, Villarama, Jr., Perez, *and Jardeleza, JJ.,
that the rights of one and the other shall be the same concur.
Art. 448. The owner of the land on which anything has as though both had acted in good faith. The CA made
been built, sown or planted in good faith, shall have the the correct observation then, when it Endnotes:
right to appropriate as his own the works, sowing or said:LawlibraryofCRAlaw
planting, after payment of the indemnity provided for in
Articles 546 and 548, or to oblige the one who built or Under Article 448, the landowner is given the option,
planted to pay the price of the land, and the one who either to appropriate the improvement as his own upon *Acting member per Special Order No. 2084 dated
sowed, the proper rent. However, the builder or planter payment of the proper amount of indemnity or to sell June 29, 2015.
cannot be obliged to buy the land if its value is the land to the possessor in good faith. Relatedly
Article 546 provides that a builder in good faith is 1Rollo,
considerably more than that of the building or trees. In pp. 21-42. Penned by Associate Justice Mario
such case, he shall pay reasonable rent, if the owner entitled to full reimbursement for all the necessary and V. Lopez and concurred in by Associate Justices
of the land does not choose to appropriate the building useful expenses incurred. In this case, however, the Francisco P. Acosta and Socorro B. Inting.
or trees after proper indemnity. The parties shall agree option of selling the land to the builder in good faith is
no longer viable in light of the ruling in the interpleader 2
upon the terms of the lease and in case of Id. at 32.
disagreement, the court shall fix the terms thereof. case. Hence, there is only one thing left for [BDC] to
do: indemnify Diaz for the improvements introduced on 3 Id. at 33.
Art. 453. If there was bad faith, not only on the part of the property.23
4
the person who built, planted or sowed on the land of Id.
another, but also on the part of the owner of such land,
Nevertheless, because the law treats both parties as if 5 Id. at 34.
the rights of one and the other shall be the same as
they acted in good faith, the CA committed reversible
though both had acted in good faith.
error in awarding moral and exemplary damages, there 6 Id.
being no basis therefor. We find it proper to delete the
It is understood that there is bad faith on the part of the
award of P100,000.00 as moral damages, P50,000.00 7 Id. at 35.
landowner whenever the act was done with his
as exemplary damages, and P25,000.00 as attorney’s
knowledge and without opposition on his part.
fees. 8Arreza v. Diaz, Jr., G.R. No. 133113, August 30, 2001,
Art. 546. Necessary expenses shall be refunded to 364 SCRA 88.
In sum, the CA correctly reversed the ruling of the RTC,
every possessor; but only the possessor in good faith
and ordered BDC to pay Diaz the amount he paid as 9Rollo, p. 37.
may retain the thing until he has been reimbursed
amortizations, as well as the value of the
therefor.
improvements that he introduced on the subject 10 Id. at 39-40.
property. However, because both parties acted in bad
Useful expenses shall be refunded only to the
faith, there is no basis for the award of moral and 11 Id. at 40.
possessor in good faith with the same right of retention,
exemplary damages, as well as attorney’s fees.
the person who has defeated him in the possession
12
having the option of refunding the amount of the Id. at 44-49.
WHEREFORE, in view of the foregoing, the January
expenses or of paying the increase in value which the
21, 2014 Decision of the Court of Appeals in CA-G.R. 13Arreza v. Diaz, Jr., supra note 8, at 98.
thing may have acquired by reason thereof.
CV No. 99179 is hereby MODIFIED to read as follows:
(1) petitioner Bliss Development Corporation/Home 14Rollo, p. 40.
Art. 548. Expenses for pure luxury or mere pleasure
Guaranty Corporation is ordered topay respondent
shall not be refunded to the possessor in good faith;
Montano M. Diaz the amount of P1,106,915.58 for the
215
15 DECISION
Id. at 17.
16 Id. at 40. BERSAMIN, J.:

17Philippine In this consolidated administrative case, complainants

National Bank v. Heirs of Estanislao
Jessie T. Campugan and Robert C. Torres seek the
Militar,G.R. No. 164801, June 30, 2006, 494 SCRA
disbarment of respondents Atty. Federico S. Tolentino,
308, 314.
Jr., Atty. Daniel F. Victorio, Jr., Atty. Renato G.
18Tamani Cunanan, Atty. Elbert T. Quilala and Atty. Constante P.
v. Salvador, G.R. No.171497, April 4, 2011,
Caluya, Jr. for allegedly falsifying a court order that
647 SCRA 132, 150.
became the basis for the cancellation of their
19Rollo, annotation of the notice of adverse claim and the notice
p. 39.
of lis pendens in the Registry of Deeds in Quezon
20 City.chanRoblesvirtualLawlibrary
Id.
21
Antecedents
The principle of unjust enrichment is provided under
Art. 22 of the Civil Code which
provides:LawlibraryofCRAlaw Atty. Victorio, Jr. had replaced Atty. Edgardo Abad as
counsel of the complainants in a civil action they
Art. 22. Every person who through an act of brought to seek the annulment of Transfer Certificate
performance by another, or any other means, acquires of Title (TCT) No. N-290546 of the Registry of Deeds
or comes into possession of something at the expense of Quezon City in the first week of January 2007 in the
of the latter without just or legal ground, shall return the Regional Trial Court (RTC) in Quezon City (Civil Case
same to him. No. Q-07-59598). They impleaded as defendants
Ramon and Josefina Ricafort, Juliet Vargas and the
22PhilippineRealty and Holdings Corporation v. Ley Register of Deeds of Quezon City. They caused to be
Construction and Development Corporation, G.R. No. annotated on TCT No. N-290546 their affidavit of
165548, June 13, 2011, 651 SCRA 719. adverse claim, as well as the notice of lis
pendens.1 Atty. Tolentino, Jr. was the counsel of
23Rollo, p. 40. defendant Ramon and Josefina Ricafort.

In their sworn complaint for disbarment dated April 23,

2009 (later docketed as A.C. No. 8261),2 the
complainants narrated that as the surviving children of
the late Spouses Antonio and Nemesia Torres, they
A.C. No. 8261, March 11, 2015 inherited upon the deaths of their parents a residential
lot located at No. 251 Boni Serrano Street, Murphy,
JESSIE T. CAMPUGAN AND ROBERT C. Cubao, Quezon City registered under Transfer
TORRES, Complainants, v. ATTY. FEDERICO S. Certificate of Title (TCT) No. RT-64333(35652) of the
TOLENTINO, JR., ATTY. RENATO G. CUNANAN, Register of Deeds of Quezon City;3 that on August 24,
ATTY. DANIEL F. VICTORIO, JR., AND ATTY. 2006, they discovered that TCT No. RT-64333(35652)
ELBERT T. QUILALA, Respondents. had been unlawfully cancelled and replaced by TCT
No. N-290546 of the Register of Deeds of Quezon City
A.C. No. 8725 under the names of Ramon and Josefina Ricafort;4 and
that, accordingly, they immediately caused the
JESSIE T. CAMPUGAN AND ROBERT C. annotation of their affidavit of adverse claim on TCT
TORRES, Complainants, v. ATTY. CONSTANTE P. No. N-290546.
CALUYA, JR., AND ATTY. ELBERT T.
QUILALA, Respondent. It appears that the parties entered into an amicable
216
settlement during the pendency of Civil Case No. Q-
07-59598 in order to end their dispute,5 whereby the
complainants agreed to sell the property and the
proceeds thereof would be equally divided between the
parties, and the complaint and counterclaim would be
withdrawn respectively by the complainants (as the
plaintiffs) and the defendants. Pursuant to the terms of
the amicable settlement, Atty. Victorio, Jr. filed a
Motion to Withdraw Complaint dated February 26,
2008,6 which the RTC granted in its order dated May
16, 2008 upon noting the defendants' lack of objection
thereto and the defendants' willingness to similarly
withdraw their counterclaim.7
The complainants alleged that from the time of the
issuance by the RTC of the order dated May 16, 2008,
they could no longer locate or contact Atty. Victorio, Jr.
despite making several phone calls and visits to his
office; that they found out upon verification at the
Register of Deeds of Quezon City that new annotations
were made on TCT No. N-290546, specifically: (1) the
annotation of the letter-request appearing to be filed by
Atty. Tolentino, Jr.8 seeking the cancellation of the
affidavit of adverse claim and the notice of lis
pendens annotated on TCT No. N-290546; and (2) the
arinotation of the decision dated May 16, 2008
rendered in Civil Case No. Q-07-59598 by the RTC,
Branch 95, in Quezon City, granting the complainants'
Motion to Withdraw Complaint;9 and that a copy of the
letter-request dated June 30, 2008 addressed to Atty.
Quilala, Registrar of Deeds of Quezon City, disclosed
that it was defendant Ramon Ricafort who had signed
the letter.
Feeling aggrieved by their discovery, the complainants
filed an appeal en consulta with the Land Registration
Authority (LRA), docketed as Consulta No. 4707,
assailing the unlawful cancellation of their notice of
adverse claim and their notice of lis pendens under
primary entries PE-2742 and PE-3828-9, respectively.
The LRA set Consulta No. 4707 for hearing on March
30, 2009, and directed the parties to submit their
respective memoranda and/or supporting documents
on or before such scheduled hearing.10However, the
records do not disclose whether Consulta No. 4707
was already resolved, or remained pending at the LRA.
Unable to receive any response or assistance from
Atty. Victorio, Jr. despite their having paid him for his
professional services, the complainants felt that said
counsel had abandoned their case. They submitted
that the cancellation of their notice of adverse claim
and their notice of lis pendens without a court order
specifically allowing such cancellation resulted from
the connivance and conspiracy between Atty. Victorio,
Jr. and Atty. Tolentino, Jr., and from the taking
advantage of their positions as officials in the Registry
of Deeds by respondents Atty. Quilala, the Chief
Registrar, and Atty. Cunanan, the acting Registrar and
signatory of the new annotations. Thus, they claimed
to be thereby prejudiced.
On July 6, 2009, the Court required the respondents to
comment on the verified complaint.11
Atty. Victorio, Jr. asserted in his Comment dated
August 17, 200912 that complainant Robert Torres had
been actively involved in the proceedings in Civil Case
No. Q-07-59598, which included the mediation
process; that the complainants, after having
aggressively participated in the drafting of the amicable
settlement, could not now claim that they had been
deceived into entering the agreement in the same way
that they could not feign ignorance of the conditions
contained therein; that he did not commit any
abandonment as alleged, but had performed in good
faith his duties as the counsel for the complainants in
Civil Case No. Q-07-59598; that he should not be held
responsible for their representation in other
proceedings, such as that before the LRA, which
required a separate engagement; and that the only
payment he had received from the complainants were
those for his appearance fees of P1,000.00 for every
hearing in the RTC.
In his Comment dated August 24, 2009,13 Atty.
Tolentino, Jr. refuted the charge of conspiracy,
stressing that he was not acquainted with the other
respondents, except Atty. Victorio, Jr. whom he had
met during the hearings in Civil Case No. Q-07-59598;
that although he had notarized the letter-request dated
June 30, 2008 of Ramon Ricafort to the Register of
Deeds, he had no knowledge about how said letter-
request had been disposed of by the Register of
Deeds; and that the present complaint was the second
disbarment case filed by the complainants against him
with no other motive except to harass and intimidate
him.
Atty. Quilala stated in his Comment dated September
1, 200914 that it was Atty. Caluya, Jr., another Deputy
Register of Deeds, who was the actual signing
authority of the annotations that resulted in the
cancellation of the affidavit of adverse claim and the
notice of lis pendens on TCT No. N-290546; that the
cancellation of the annotations was undertaken in the
regular course of official duty and in the exercise of the
ministerial duty of the Register of Deeds; that no
irregularity occurred or was performed in the
cancellation of the annotations; and that the Register
of Deeds was impleaded in Civil Case No. Q-07-59598
only as a nominal party, thereby discounting any
involvement in the proceedings in the case.
Atty. Cunanan did not file any comment.15
As the result of Atty. Quilala's allegation in his
Comment in A.C. No. 8261 that it had been Atty.
Caluya, Jr.'s signature that appeared below the
cancelled entries, the complainants filed another sworn
disbarment complaint dated August 26, 2010 alleging
that Atty. Caluya, Jr. had forged the signature of Atty.
Cunanan.16 This disbarment complaint was docketed
as A.C. No. 8725, and was later on consolidated with
A.C. No. 826117 because the complaints involved the
same parties and rested on similar allegations against
the respondents.
Atty. Quilala filed his Comment in A.C. No. 8725 to
belie the allegation of forgery and to reiterate the
arguments he had made in A.C. No. 8261.18 On his
part, Atty. Caluya, Jr. manifested that he adopted Atty.
Quilala's Comment.19
Ruling
We dismiss the complaints for disbarment for being
bereft of merit.
Well entrenched in this jurisdiction is the rule that a
lawyer may be disciplined for misconduct committed
either in his professional or private capacity. The test is
whether his conduct shows him to be wanting in moral
character, honesty, probity, and good demeanor, or
whether his conduct renders him unworthy to continue
as an officer of the Court.20 Verily, Canon 7 of the Code
of Professional Responsibility mandates all lawyers to
217
uphold at all times the dignity and integrity of the Legal
Profession. Lawyers are similarly required under Rule
1.01, Canon 1 of the same Code not to engage in any
unlawful, dishonest and immoral or deceitful conduct.
Failure to observe these tenets of the Code of
Professional Responsibility exposes the lawyer to
disciplinary sanctions as provided in Section 27, Rule
138 of the Rules of Court, as
amended, viz.:chanroblesvirtuallawlibrary
Section 27. Disbarment or suspension of attorneys by
Supreme Court, grounds therefor. — A member of the
bar may be disbarred or suspended from his office as
attorney by the Supreme Court for any deceit,
malpractice, or other gross misconduct in such office,
grossly immoral conduct, or by reason of his conviction
of a crime involving moral turpitude, or for any violation
of the oath which he is required to take before the
admission to practice, or for a wilful disobedience
appearing as an attorney for a party to a case without
authority so to do. The practice of soliciting cases at
law for the purpose of gain, either personally or through
paid agents or brokers, constitutes malpractice.
The complainants' allegations of the respondents' acts
and omissions are insufficient to establish any
censurable conduct against them.
Section 10 of Presidential Decree No. 1529 (Property
Registration Decree) enumerates the general duties of
the Register of Deeds, as
follows:chanroblesvirtuallawlibrary
Section 10. General functions of Registers of Deeds. -
x x x documents presented for registration was limited only
It shall be the duty of the Register of Deeds
to immediately register an instrument presented for
registration dealing with real or personal property
which complies with all the requisites for registration.
He shall see to it that said instrument bears the proper
documentary science stamps and that the same are
properly canceled. If the instrument is not registrable,
he shall forthwith deny registration thereof and inform
the presenter of such denial in writing, stating the
ground or reason therefor, and advising him of his right
to appeal by consulta in accordance with Section 117
of this Decree. (Emphasis supplied)
The aforementioned duty of the Register of Deeds is
ministerial in nature.21 A purely ministerial act or duty is
one that an officer or tribunal performs in a given state
of facts, in a prescribed manner, in obedience to the
mandate of a legal authority, without regard to or the
exercise of his own judgment upon the propriety or
impropriety of the act done. If the law imposes a duty
upon a public officer and gives him the right to decide
how or when the duty shall be performed, such duty is
discretionary, not ministerial. The duty is ministerial
only when its discharge requires neither the exercise of
official discretion nor the exercise of judgment.22
In Gabriel v. Register of Deeds of Rizal,23 the Court
underscores that registration is a merely ministerial act
of the Register of Deeds,
explaining:chanroblesvirtuallawlibrary
xxx [W]hether the document is invalid, frivolous or
intended to harass, is not the duty of a Register of
Deeds to decide, but a court of competent jurisdiction,
and that it is his concern to see whether the documents
sought to be registered conform with the formal and
legal requirements for such documents.
In view of the foregoing, we find no abuse of authority
or irregularity committed by Atty. Quilala, Atty.
Cunanan, and Atty. Caluya, Jr. with respect to the
cancellation of the notice of adverse claim and the
notice of lis pendens annotated on TCT No. N-290546.
Whether or not the RTC order dated May 16, 2008 or
the letter-request dated June 30, 2008 had been
falsified, fraudulent or invalid was not for them to
determine inasmuch as their duty to examine
to what appears on the face of the documents. If, upon
their evaluation of the letter-request and the RTC
order, they found the same to be sufficient in law and
t]o be in conformity with existing requirements, it
became obligatory for them to perform their ministerial
duty without unnecessary delay.24
Should they be aggrieved by said respondents'
performance of duty, complainants were not bereft of
any remedy because they could challenge the
performance of duty by bringing the matter by way
of consultawith the LRA, as provided by Section
11725 of Presidential Decree No. 1529. But, as
enunciated in Gabriel v. Register of Deeds of Rizal,26 it
was ultimately within the province of a court of
competent jurisdiction to resolve issues concerning the
validity or invalidity of a document registered by the
Register of Deeds.
The complainants charge Atty. Victorio, Jr. and Atty.
Tolentino, Jr. with having conspired with each other to
guarantee that the parties in Civil Case No. Q-59598
would enter into the amicable settlement, and then to
cause the cancellation of the affidavit of adverse claim
and notice of lis pendens annotated on TCT No. N-
290546. The complainants further fault Atty. Victorio,
Jr. with having abandoned their cause since the
issuance of the RTC of its order dated May 16, 2008.
The complainants' charges are devoid of substance.
Although it is not necessary to prove a formal
agreement in order to establish conspiracy because
conspiracy may be inferred from the circumstances
attending the commission of an act, it is nonetheless
essential that conspiracy be established by clear and
convincing evidence.27 The complainants failed in this
regard. Outside of their bare assertions that Atty.
Victorio, Jr. and Atty. Tolentino, Jr. had conspired with
each other in order to cause the dismissal of the
complaint and then discharge of the annotations, they
presented no evidence to support their allegation of
conspiracy. On the contrary, the records indicated their
own active pjarticipation in arriving at the amicable
settlement with the defendants in Civil Case No. Q-07-
59598. Hence, they could not now turn their backs on
the amicable settlement that they had themselves
entered into.
Even assuming that Atty. Victorio, Jr. and Atty.
Tolentino, Jr. initiated ahd participated in the
settlement of the case, there was nothing wrong in their
doing so. It was actually their obligation as lawyers to
do so, pursuant to Rule 1.04, Canon 1 of the Code of
Professional
Responsibility, viz.:chanroblesvirtuallawlibrary
RULE 1.04 - A lawyer shall encourage his clients to
avoid, end or settle a controversy if it will admit of a fair
settlement.
In fine, the presumption of the validity of the amicable
settlement of the complainants and the defendants in
Civil Case No. Q-07-59598 subsisted.28
218
Anent the complainants' charge of abandonment
WHEREFORE, the Court DISMISSES the baseless 18Rollo,
against Atty. Victorio, Jr., Rule 18.03 and Rule 18.04, A.C. No. 8725, pp. 14-18.
Canon 18 of the Code of Professional disbarment complaints against Atty. Federico S.
Responsibility are applicable, to 19
Tolentino, Jr., Atty. Renato G. Cunanan, Atty. Daniel F. Id. at 49-50.
wit:chanroblesvirtuallawlibrary Victorio, Jr., Atty. Elbert T. Quilala and Atty. Constante
20Tan,
P. Caluya, Jr. Jr. v. Gumba, A.C. No. 9000, October 5, 2011,
CANON 18 - A lawyer shall serve his client with 658 SCRA 527, 532, Roa v. Moreno, A.C. No 8382,
competence and diligence. SO ORDERED.chanroblesvirtuallawlibrary April 21, 2010, 618 SCRA 693, 699.

Rule 18.03 - A lawyer shall not neglect a legal matter Sereno, C. J., Leonardo-De Castro, Perez, and Perlas- 21See Register of Deeds, Pasig, Rizal v. Heirs of Hi
entrusted to him, and his negligence in connection Bernabe, JJ., concur. Caiji, 99 Phil 25, 30 (1956); Ledesma v. Villasenor,
therewith shall render him liable. G.R. No. L-18725, March 31, 1965, 13 SCRA 494, 496.
Endnotes:
Rule 18.04 - A lawyer shall keep the client informed of 22Mallari v. Government Service Insurance System, et.
the status of his case and shall respond within a al., G.R. No. 157659, January 25, 2010, 611 SCRA 32,
reasonable time to the client's request for information. 49-50; Espiridion v. Court of Appeals, G.R. No.
1Rollo, A.C. No. 8261, p. 7. 146933, June 8, 2006, 490 SCRA 273, 277.
There is no issue that the complainants engaged the
services of Atty. Victorio, Jr. as their counsel in Civil 2 Id. at 1-4. 23G.R. No. L-17956, September 30, 1963, 9 SCRA
Case No. Q-07-59598. Atty. Victorio, Jr. served as
3
136, 141.
such counsel. With Atty. Victorio, Jr. assistance, the Id. at 5.
complainants obtained a fair settlement consisting in 24
4
Noblejas, Registration of Land Titles and Deeds,
receiving half of the proceeds of the sale of the Id. at 6. 1992 Revised Edition, p. 387.
property in litis, without any portion of the proceeds
accruing to counsel as his legal fees. The complainants 5 Id. at 24-25. 25 Section 117. Procedure. - When the Register of
did not competently and persuasively show any
6
Deeds is in doubt with regard to the proper step to be
unfaithfulness on the part of Atty. Victorio, Jr. as far as Id. at 8-9. taken or memorandum to be made in pursuance of any
their interest in the litigation was concerned. Hence,
7
deed, mortgage or other instrument presented to him
Atty. Victorio, Jr. was not liable for abandonment. Id. at 10. for registration, or where any party in interest does
8
not agree with the action taken by the Register of
Atty. Victorio, Jr. could not be faulted for the perceived Id. at 7. Deeds with reference to any such instrument, the
inattention to any other matters subsequent to the
9
question shall be submitted to the Commissioner
termination of Civil Case No. Q-07-59598. Unless Id. of Land Registration by the Register of Deeds, or
otherwise expressly stipulated between them at any by the party in interest thru the Register of Deeds.
time during the engagement, the complainants had no 10 Id. at 12.
right to assume that Atty. Victorio, Jr.'s legal xxxx
representation was indefinite as to extend to his 11 Id. at 13.
representation of them in the LRA. The Law Profession
did not burden its members with the responsibility of 12 The Commissioner of Land Registration, considering
Id. at 17-18.
indefinite service to the clients; hence, the rendition of the consulta and the records certified to him after
professional services depends on the agreement 13 notice to the parties and hearing, shall enter an order
Id. at 14-15.
between the attorney and the client. Atty. Victorio, Jr.'s prescribing the step to be taken or memorandum to be
alleged failure to respond to the complainants' calls or 14 made. His resolution or ruling in consultas shall be
Id. at 28-30.
visits, or to provide them with his whereabouts to conclusive and binding upon all Registers of Deeds,
enable them to have access to him despite the 15 Id. at 52. provided, that the party in interest who disagrees
termination of his engagement in Civil Case No. Q-07- with the final resolution, ruling or order of the
59598 did not equate to abandonment without the 16Rollo, Commissioner relative to consultas may appeal to
A.C. No. 8725, pp. 1-3.
credible showing that he continued to come under the the Court of Appeals within the period and in manner
professional obligation towards them after the 17Rollo, provided in Republic Act No. 5434. (Bold emphasis
A.C. No. 8261 p. 53.
termination of Civil Case No. Q-07-59598.cralawred supplied)
219
 liable for the death of Marina Arabit Oliva (Marina
26 Supra note 23. Oliva) despite having been acquitted for Reckless
Imprudence Resulting in Homicide on the ground of
27People v. Dagani, G.R. No. 153875, August 16, 2006, insufficiency of evidence.
499 SCRA 64, 79.
The Facts
28Bautista
v. Seraph Management Group, Inc., G.R.
On January 4, 2006, Daluraya was charged in an
No. 174039, June 29, 2010, 622 SCRA 141, 145.
Information4 for Reckless Imprudence Resulting in
Homicide in connection with the death5 of Marina
Oliva. Records reveal that sometime in the afternoon
of January 3, 2006, Marina Oliva was crossing the
street when a Nissan Vanette, bearing plate number
UPN-172 and traversing EDSA near the Quezon
Avenue flyover in Quezon City, ran her over.6 While
Marina Oliva was rushed to the hospital to receive
medical attention,she eventually died, prompting her
daughter, herein respondent Marla Oliva (Marla), to file
a criminal case for Reckless Imprudence Resulting in
Homicide against Daluraya, the purported driver of the
vehicle.7

During the proceedings, the prosecution presented as

witness Shem Serrano (Serrano), an eye-witness to
the incident, who testified that on said date, he saw a
woman crossing EDSA heading towards the island
near the flyover and that the latter was bumped by a
Nissan Vanette bearing plate number UPN-172. The
prosecution also offered the testimonies of (a) Marla,
who testified as to the civil damages sustained by her
family as a result of her mother’s death; (b) Dr. Paul
Ortiz (Dr. Ortiz), who presented his findings on the
autopsy conducted upon the body of Marina Oliva; and
(c) Police Senior Inspector Lauro Gomez (PSI Gomez),
who conducted the investigation following the incident
and claimed that Marina Oliva was hit by the vehicle
G.R. No. 210148 December 8, 2014 being driven by Daluraya, albeit he did not witness the
incident.8
ANTONIO L. DALURAYA, Petitioner,
vs. After the prosecution rested its case, Daluraya filed an
MARLA OLIVA, Respondent. Urgent Motion to Dismiss (demurrer)9 asserting, inter
alia, that he was not positively identified by any of the
DECISION prosecution witnesses as the driver of the vehicle that
PERLAS-BERNABE, J.: hit the victim, and that there was no clear and
competent evidence of how the incident transpired.10
Assailed in this petition for review on certiorari1 are the
The MeTC Ruling
Decision2 dated June 28, 2013 and the
Resolution3 dated November 22, 2013 rendered by the In an Order11 dated May 24, 2010, the Metropolitan
Court of Appeals (CA) in CA-G.R. SP No. 125113 Trial Court of Quezon City, Branch 38 (MeTC) granted
finding petitioner Antonio L. Daluraya (Daluraya) civilly
220
Daluraya’s demurrer and dismissed the case for
insufficiency of evidence. It found that the testimonies
of the prosecution witnesses were wanting in material
details and that they failed to sufficiently establish that
Daluraya committed the crime imputed upon
him.12 Deconstructing the testimonies of the
prosecution witnesses individually, the MeTC found
that: (a) Marla merely testified on the damages
sustained by her family but she failed to identify
Daluraya as the driver of the vehicle that hit her mother;
(b) Serrano also did not identify
Daluraya as the driver of the said vehicle; (c) Dr. Ortiz
merely testified on the autopsy results; and (d) PSI
Gomez, while he did investigate the incident, likewise
declared thathe did not witness the same.13
Marla moved for reconsideration,14 which the MeTC
denied in an Order15 dated November 4, 2010,
clarifying that the grant of Daluraya’s demurrer had the
effect of an acquittal and that reconsideration of its
Order granting Daluraya’s demurrer would violate the
latter’s right against double jeopardy.16 With respect to
the civil aspect of the case, the MeTC likewise denied
the same, holding that no civil liability can be awarded
absent any evidence proving that Daluraya was the
person responsible for Marina Oliva’s demise.17
Aggrieved, Marla appealed18 to the Regional Trial
Court of Quezon City, Branch 76 (RTC), insisting that
the MeTC failed to make any finding as to the civil
liability of Daluraya,19 which finding was not precluded
by the dismissal of the criminal aspect of the case.
The RTC Ruling
In a Decision20 dated September 8, 2011, the RTC
dismissed the appeal and affirmed the MeTC’s
ruling,declaring that "the act from which the criminal
responsibility may spring did not at all exist."21
Marla filed a motion for reconsideration22 which,
although filed beyond the reglementary period, was
nonetheless accepted. However, the RTC found the
same without merit and thus, sustained the factual
findings and rulings of the MeTC in its Order23 dated
May 10, 2012. Dissatisfied, Marla elevated the case to
the CA via petition for review, maintaining that
Daluraya must be held civilly liable.
The CA Ruling
In a Decision24 dated June 28, 2013, the CA granted
the petition and reversed the RTC Decision, ordering
Daluraya to pay Marla the amounts of ₱152,547.00 as
actual damages, ₱50,000.00 as civil indemnity, and
₱50,000.00 as moral damages.25 In so ruling, the CA
held that the MeTC’s Order showed that Daluraya’s
acquittal was based on the fact that the prosecution
failed to prove his guilt beyond reasonable doubt. As
such, Daluraya was not exonerated from civil liability.26
Moreover, the CA considered the following pieces of
evidence to support its finding that Daluraya must be
held civilly liable: (a) the inadmissible sworn statement
executed by Daluraya where he admitted that he drove
the subject vehicle which hit Marina Oliva; (b) the
conclusion derived from Serrano’s testimony that the
woman he saw crossing the street who was hit by a
Nissan Vanette with plate number UPN-172, and the
victim who eventually died, are one and the same; (c)
the Philippine National Police Referral Letter of one
Police Chief Inspector Virgilio Pereda identifying
Daluraya as the suspectin the case of Reckless
Imprudence Resulting in Homicide involving the death
of Marina Oliva, and stating that he brought the victim
to the Quezon City General Hospital for treatment but
was declared dead on arrival; and (d) the subject
vehicle was registered in the name of Daluraya’s aunt,
Gloria Zilmar,27 who authorized him to claim the vehicle
from the MeTC.28
Daluraya filed a motion for reconsideration,29 which the
CA denied in a Resolution30 dated November 22,
2013,hence, this petition.
The Issue Before the Court
The sole issue advanced for the Court’s resolution is
whether or not the CA was correct in finding Daluraya
civilly liable for Marina Oliva’s death despite his
acquittal in the criminal case for Reckless Imprudence
Resulting in Homicide on the ground of insufficiency of
evidence.
The Court’s Ruling
The petition is meritorious.
Every person criminally liable for a felony is also civilly
liable. The acquittal of an accused of the crime
charged, however, does not necessarily extinguish his
civil liability.31 In Manantan v. CA,32 the Court
expounded on the two kinds of acquittal recognized by
our law and their concomitant effects on the civil liability
of the accused, as follows:
Our law recognizes two kinds of acquittal, with different
effects on the civil liability of the accused. First is an
acquittal on the ground that the accused is not the
author of the actor omission complained of. This
instance closes the door to civil liability, for a person
who has been found to be not the perpetrator of any
act or omission cannot and can never be held liable for
such act or omission. There being no delict, civil liability
ex delictois out of the question, and the civil action, if
any, which may be instituted must be based on
grounds other than the delict complained of. This is the
situation contemplated inRule 111 of the Rules of
Court. The second instance is an acquittal based on
reasonable doubt on the guilt of the accused. In this
case, even if the guilt of the accused has not been
satisfactorily established, he is not exempt from civil
liability which may be proved by preponderance of
evidence only.33
In Dayap v. Sendiong,34 the Court explained further:
The acquittal of the accused does not automatically
preclude a judgment against him on the civil aspect of
the case.1âwphi1The extinction of the penal action
does not carry with it the extinction of the civil liability
where: (a) the acquittal is based on reasonable doubt
as only preponderance of evidence is required; (b) the
court declares that the liability of the accused is only
civil; and (c) the civil liability of the accused does not
arise from or is not based upon the crime of which the
accused is acquitted. However, the civil action based
on delictmay be deemed extinguished if there is a
finding on the final judgment in the criminal action that
the act or omission from which the civil liability may
arise did not exist or where the accused did not commit
the acts or omission imputed to him.
Thus, if demurrer is granted and the accused is
acquitted by the court, the accused has the right to
adduce evidence on the civil aspect of the case unless
the court also declares that the act or omission from
which the civil liability may arise did not exist. This is
because when the accused files a demurrer to
evidence, he has not yet adduced evidence both on the
criminal and civil aspects of the case. The only
evidence on record is the evidence for the prosecution.
221
 1
What the trial court should do is issue an order or author of the crime ascribed against him. Rollo, pp. 10-20.
partial judgment granting the demurrer to evidence and Consequently, his civil liability should be deemed as
2
acquitting the accused, and set the case for non-existent by the nature of such acquittal. Id. at 203-208. Penned by Associate Justice Jose C.
continuation of trial for the accused to adduce evidence Reyes, Jr. with Associate Justices Mario V. Lopez and
on the civil aspect of the case and for the private WHEREFORE, the petition is GRANTED. The Socorro B. Inting, concurring.
complainant to adduce evidence by way of rebuttal. Decision dated June 28, 2013 and the Resolution
3 Id. at 217.
Thereafter, the court shall render judgment on the civil dated November 22, 2013 of the Court of Appeals in
aspect of the case.35 CA-G.R. SP No. 125113 are hereby REVERSED and 4 Id. at 48.
SET ASIDE. The Decision dated September 8,2011
(Emphases supplied) and the Order dated May 10, 2012 of the Regional Trial 5 See Certificate of Death; id. at 59.
Court of Quezon City, Branch 76 are REINSTATED.
In case of an acquittal, the Rules of Court requires that 6 Id. at 203.
the judgment state "whether the evidence of the SO ORDERED.
prosecution absolutely failed to prove the guilt of the 7 Id. at 25.
accused or merely failed to prove his guilt beyond ESTELA M. PERLAS-BERNABE
reasonable doubt. In either case, the judgment shall Associate Justice 8 Id. at 26.
determine if the act or omission from which the civil
WE CONCUR: 9 Not attached to the records of this case. See id. at 12.
liability might arise did not exist."36
MARIA LOURDES P.A. SERENO 10 Id. at 12-13.
A punctilious examination of the MeTC’s Order, which
Chief Justice
the RTC sustained, will show that Daluraya’s acquittal 11Id. at 145-147. Penned by Judge Nadine Jessica
Chairperson
was based on the conclusion that the act or omission Corazon J. Fama.
from which the civil liability may arise did not exist, TERESITA J.
given that the prosecution was not able to establish ANTONIO T. CARPIO* LEONARDO-DE
12 Id. at 147.
that he was the author of the crime imputed against Associate Justice CASTRO 13
him. Such conclusion is clear and categorical when the Associate Justice Id. at 146.
MeTC declared that "the testimonies of the prosecution 14
witnesses are wanting in material details and they did Not attached to the records of this case.
BIENVENIDO L. REYES**
not sufficiently establish that the accused precisely Associate Justice 15 Rollo, pp. 148-150.
committed the crime charged against
him."37 Furthermore, when Marla sought CERTIFICATION 16 Id. at 148.
reconsideration of the MeTC’s Order acquitting
Daluraya, said court reiterated and firmly clarified that Pursuant to Section 13, Article VIII of the Constitution, 17 Id. at 149.
"the prosecution was not able to establish that the I certify that the conclusions in the above Decision had
accused was the driver of the Nissan Vanette which been reached in consultation before the case was 18 See Appellant’s Memorandum dated April 18, 2011;
bumped Marina Oliva"38 and that "there is no assigned to the writer of the opinion of the Court's id. at 151-169.
competent evidence on hand which proves that the Division.
19
accused was the person responsible for the death of Id. at 159-161.
MARIA LOURDES P.A. SERENO
Marina Oliva."39 20Id. at 45-46. Penned by Presiding Judge Alexander
Chief Justice
Clearly, therefore, the CA erred in construing the S. Balut.
findings of the MeTC, as affirmed by the RTC, that 21 Id. at 46.
Daluraya’s acquittal was anchored on reasonable
doubt, which would necessarily call for a remand of the Footnotes
22 Dated October 21, 2011. (Id. at 175-184.)
case to the court a quo for the reception of Daluraya’s
23
evidence on the civil aspect.1âwphi1 Records disclose * Designated Acting Member per Special Order No. Id. at 47.
that Daluraya’s acquittal was based on the fact that 1899 dated December 3, 2014. 24
"the act or omission from which the civil liability may Id. at 203-208.
arise did not exist" in view of the failure of the ** Designated Acting Member per Special Order No. 25
1892 dated November 28, 2014. Id. at 208.
prosecution to sufficiently establish that he was the
222
26 PERLAS-BERNABE, J.:
Id. at 206.
27See Motion to Release Vehicle dated January 11, Before the Court is an appeal assailing the
2005; id. at 190-191. Decision1 dated February 15, 2013 of the Court of
Appeals (CA) in CA-G.R. CR-H.C. No. 02888 finding
28 Id. at 207. accused-appellants Armando Dionaldo y Ebron
29 (Armando), Renato Dionaldo y Ebron (Renato),
Dated July 19, 2013; id. at 209-215.
Mariano Gariguez, Jr. y Ramos (Mariano), and Rodolfo
30 Id. at 217. Larido y Ebron (Rodolfo) guilty beyond reasonable
doubt of the crime of Kidnapping and Serious Illegal
31Lumantas v. Calapiz, G.R. No. 163753, January 15, Detention.
2014.
The Facts
32 403 Phil. 299 (2001).
At around 8 o'clock in the morning of May 16, 2003,
33 Roderick Navarro (Roderick) dropped his brother
Id. at 308-309; citations omitted.
Edwin Navarro (Edwin) off at the Health Is Wealth Gym
34 597 Phil. 127 (2009). in Caloocan City. Thirty minutes later, he received a
35
text message from another brother who told him that
Id. at 141, citing Hun Hyung Park v. Eung Won Choi, Edwin had been kidnapped.2 Records show that three
544 Phil. 431, 444 (2007) and Salazar v. People, 458 (3) men, later identified as Armando, Renato, and
Phil. 504, 515-517 (2003). Mariano, forcibly dragged a bloodied Edwin down the
36 RULES OF COURT, Rule 120, Section 2. stairway of the gym and pushed him inside a dark
green Toyota car with plate number UKF 194.3 Upon
37 Rollo, p. 147. receiving the message, Roderick immediately reported
the incident to the police. At around 10 o’clock in the
38 Id. at 149. morning of the same day, he received a phone call from
39
Edwin‟s kidnappers who threatened to kill Edwin if he
Id. at 150. should report the matter to the police.4

The following day, Roderick received another call from

the kidnappers, who demanded the payment of ransom
money in the amount of ₱15,000,000.00. Roderick told
them he had no such money, as he only had
₱50,000.00. On May 19, 2003, after negotiations over
the telephone, the kidnappers agreed to release Edwin
in exchange for the amount of ₱110,000.00. Roderick
was then instructed to bring the money to Batangas
and wait for their next call.5

At around 7:30 in the evening of the same day, as

G.R. No. 207949 July 23, 2014
Roderick was on his way to Batangas to deliver the
PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee, ransom money, the kidnappers called and instructed
vs. him to open all the windows of the car he was driving
ARMANDO DIONALDO y EBRON, RENATO and to turn on the hazard light when he reaches the
DIONALDO y EBRON, MARIANO GARIGUEZ, JR. y designated place. After a while, Roderick received
RAMOS, and RODOLFO LARIDO y another call directing him to exit in Bicutan instead and
EBRON, Accused-Appellants. proceed to C-5 until he arrives at the Centennial
Village. He was told to park beside the Libingan ng mga
RESOLUTION Bayani. After several hours, an orange Mitsubishi car

223
with plate number DEH 498 pulled up in front of his
vehicle where four (4) men alighted. Roderick saw one
of the men take a mobile phone and upon uttering the
word "alat," the men returned to their car and drove
away.6
Meanwhile, a team had been organized to investigate
the kidnapping of Edwin, headed by SPO3 Romeo
Caballero (SPO3 Caballero) and PO3 Nestor
Acebuche (PO3 Acebuche) of the Camp Crame Police
Anti-Crime Emergency Response (PACER). During
the course of the investigation, Rodolfo, an employee
at the Health Is Wealth Gym, confessed to PO3
Acebuche that he was part of the plan to kidnap Edwin,
as in fact he was the one who tipped off Mariano,
Renato, Armando and a certain
Virgilio7 Varona8 (Virgilio) on the condition that he will
be given a share in the ransom money. Rodolfo gave
information on the whereabouts of his cohorts, leading
to their arrest on June 12, 2003. In the early morning
of the following day or on June 13, 2003, the PACER
team found the dead body of Edwin at Sitio Pugpugan
Laurel, Batangas, which Roderick identified.9
Thus, accused-appellants as well as Virgilio were
charged in an Information10 which reads:
That on or about the 16th day of May, 2003 in Caloocan
City, Metro Manila and within the jurisdiction of this
Honorable Court, the above-named accused,
conspiring together and mutually helping one another,
being then private persons, did then and there by force
and intimidation willfully, unlawfully and feloniously with
the use of motor vehicle and superior strength take,
carry and deprive EDWIN NAVARRO Y ONA, of his
liberty against his will, for the purpose of extorting
ransom as in fact a demand of ₱15,000,000.00 was
made as a condition of the victim’s release and on the
occasion thereof, the death of the victim resulted.
Contrary to law.
During arraignment, accused-appellants pleaded not
guilty11 and interposed the defenses of denial and alibi.
Except for Rodolfo, they individually claimed that on
said date and time, they were in their respective
houses when they were taken by men in police
uniforms, then subsequently brought to Camp Crame,
and there allegedly tortured and detained. On the other
hand, Rodolfo, for himself, averred that at around 8
o’clock in the evening of June 12, 2003, while walking
on his way home, he noticed that a van had been
following him. Suddenly, four (4) persons alighted from
the vehicle, boarded him inside, blindfolded him, and
eventually tortured him. He likewise claimed that he
was made to sign an extrajudicial confession,
purporting too that while a certain Atty. Nepomuceno
had been summoned to assist him, the latter failed to
do so.12
During trial, the death of the victim, Edwin, was
established through a Certificate of Death13 with
Registry No. 2003-050 (subject certificate of death)
showing that he died on May 19, 2003 from a gunshot
wound on the head.
The RTC Ruling
In a Decision14 dated June 13, 2007, the Regional Trial
Court of Caloocan City, Branch 129 (RTC), in Crim.
Case No. C-68329, convicted accused-appellants of
the crime of Kidnapping and Serious Illegal Detention,
sentencing each of them to suffer the penalty of
reclusion perpetua.
It gave credence to the positive and straightforward
testimonies of the prosecution witnesses which clearly
established that it was the accusedappellants who
forcibly dragged a bloodied Edwin into a car and,
consequently, deprived him of his liberty.15 In light
thereof, it rejected accused-appellants‟ respective
alibis and claims of torture, which were not
substantiated. It also held that the crime of Kidnapping
had been committed for the purpose of extorting
ransom, which is punishable by death. However, in
view of the suspended imposition of the death penalty
pursuant to Republic Act No. (RA) 9346,16 only the
penalty of reclusion perpetua was imposed. 17 Further,
the RTC found that conspiracy attended the
commission of the crime, as the accused-appellants’
individual participation was geared toward a joint
purpose and criminal design.18
Notably, while the RTC found that the testimonies of
the prosecution witnesses prove that the victim Edwin
was abducted, deprived of liberty, and eventually
killed,19 a fact which is supported by the subject
certificate of death, it did not consider said death in its
judgment. The CA Ruling
In a Decision20 dated February 15, 2013, the CA
affirmed in toto the RTC’s conviction of accused-
appellants, finding that the prosecution was able to
clearly establish all the elements of the crime of
Kidnapping and Serious Illegal Detention, namely: (a)
the offender is a private individual; (b) he kidnaps or
detains another, or in any manner deprives the latter of
his liberty; (c) the act of detention or kidnapping must
be illegal; and (d) in the commission of the offense, any
of the following circumstances is present: (1) the
kidnapping or detention lasts for more than three days;
(2) it is committed simulating public authority; (3) any
serious physical injuries are inflicted upon the person
kidnapped or detained or threats to kill him are made;
or (4) the person kidnapped or detained is a minor,
except when the accused is any of the parents, female
or a public officer.21 It likewise sustained the finding
that the kidnapping was committed for the purpose of
extorting ransom, as sufficiently proven by the
testimony of the brother of the victim.22 Moreover, the
CA affirmed that conspiracy attended the commission
of the crime, as the acts of accused-appellants
emanated from the same purpose or common design,
and they were united in its execution.23
Separately, the CA found that accused-appellants’
claims of torture were never supported, and that
Rodolfo voluntarily signed the extrajudicial confession
and was afforded competent and independent counsel
in its execution.24
Aggrieved by their conviction, accused-appellants filed
the instant appeal.
The Issue Before the Court
The sole issue to be resolved by the Court is whether
or not accusedappellants are guilty of the crime of
Kidnapping and Serious Illegal Detention.
The Court’s Ruling
The appeal is devoid of merit.
Well-settled is the rule that the question of credibility of
witnesses is primarily for the trial court to determine. Its
assessment of the credibility of a witness is entitled to
great weight, and it is conclusive and binding unless
shown to be tainted with arbitrariness or unless,
through oversight, some fact or circumstance of weight
and influence has not been considered. Absent any
224
showing that the trial judge overlooked,
misunderstood, or misapplied some facts or
circumstances of weight which would affect the result
of the case, or that the judge acted arbitrarily, his
assessment of the credibility of witnesses deserves
high respect by the appellate court.25
In this case, the RTC, as affirmed by the CA, gave
weight and credence to the testimonies of the
prosecution witnesses, which they found to be
straightforward and consistent. Through these
testimonies, it was clearly established that accused-
appellants, who were all private individuals, took the
victim Edwin and deprived him of his liberty, which acts
were illegal, and for the purpose of extorting
ransom.26 Thus, seeing no semblance of arbitrariness
or misapprehension on the part of the court a quo, the
Court finds no compelling reason to disturb its factual
findings on this score.1âwphi1
Anent the finding that conspiracy attended the
commission of the crime, the Court likewise finds the
conclusion of the RTC in this regard, as affirmed by the
CA, to be well-taken. Conspiracy exists when two or
more persons come to an agreement concerning the
commission of a felony and decide to commit it, and
when conspiracy is established, the responsibility of
the conspirators is collective, not individual, rendering
all of them equally liable regardless of the extent of
their respective participations.27 In this relation, direct
proof is not essential to establish conspiracy, as it can
be presumed from and proven by the acts of the
accused pointing to a joint purpose, design, concerted
action, and community of interests.28 Hence, as the
factual circumstances in this case clearly show that
accused-appellants acted in concert at the time of the
commission of the crime and that their acts emanated
from the same purpose or common design, showing
unity in its execution,29 the CA, affirming the trial court,
correctly ruled that there was conspiracy among them.
The foregoing notwithstanding, the Court is, however,
constrained to modify the ruling of the RTC and the CA,
as the crime the accusedappellants have committed
does not, as the records obviously bear, merely
constitute Kidnapping and Serious Illegal Detention,
but that of the special complex crime of Kidnapping for
Ransom with Homicide. This is in view of the victim’s
(i.e., Edwin’s) death, which was (a) specifically charged
in the Information,30and (b) clearly established during
the trial of this case. Notably, while this matter was not
among the issues raised before the Court, the same
should nonetheless be considered in accordance with
the settled rule that in a criminal case, an appeal, as in
this case, throws open the entire case wide open for
review, and the appellate court can correct errors,
though unassigned, that may be found in the appealed
judgment.31
After the amendment of the Revised Penal Code on
December 31, 1993 by RA 7659, Article 267 of the
same Code now provides:
Art. 267. Kidnapping and serious illegal detention. –
Any private individual who shall kidnap or detain
another, or in any other manner deprive him of his
liberty, shall suffer the penalty of reclusion perpetua to
death:
1. If the kidnapping or detention shall have lasted more
than three days.
2. If it shall have been committed simulating public
authority.
3. If any serious physical injuries shall have been
inflicted upon the person kidnapped or detained; or if
threats to kill him shall have been made.
4. If the person kidnapped or detained shall be a minor,
except when the accused is any of the parents, female
or a public officer;
The penalty shall be death where the kidnapping or
detention was committed for the purpose of extorting
ransom from the victim or any other person, even if
none of the circumstances above-mentioned were
present in the commission of the offense.
When the victim is killed or dies as a consequence of
the detention or is raped, or is subjected to torture or
dehumanizing acts, the maximum penalty shall be
imposed. (Emphases supplied)
The Court further elucidated in People v. Mercado:32
In People v. Ramos, the accused was found guilty of
two separate heinous crimes of kidnapping for ransom
and murder committed on July 13, 1994 and sentenced
to death. On appeal, this Court modified the ruling and
found the accused guilty of the "special complex crime"
of kidnapping for ransom with murder under the last
paragraph of Article 267, as amended by Republic Act
No. 7659. This Court said:
x x x This amendment introduced in our criminal
statutes the concept of „special complex crime‟ of
kidnapping with murder or homicide. It effectively
eliminated the distinction drawn by the courts between
those cases where the killing of the kidnapped victim
was purposely sought by the accused, and those
where the killing of the victim was not deliberately
resorted to but was merely an afterthought.
Consequently, the rule now is: Where the person
kidnapped is killed in the course of the detention,
regardless of whether the killing was purposely sought
or was merely an afterthought, the kidnapping and
murder or homicide can no longer be complexed under
Art. 48, nor be treated as separate crimes, but shall be
punished as a special complex crime under the last
paragraph of Art. 267, as amended by RA No.
7659.33 (Emphases supplied; citations omitted)
Thus, further taking into account the fact that the
kidnapping was committed for the purpose of extorting
ransom, accused-appellants’ conviction must be
modified from Kidnapping and Serious Illegal Detention
to the special complex crime of Kidnapping for Ransom
with Homicide, which carries the penalty of death. As
earlier intimated, the enactment of RA 9346 had
suspended the imposition of the death penalty. This
means that the accused-appellants could, as the CA
and trial court properly ruled, only be sentenced to the
penalty of reclusion perpetua. To this, the Court adds
that the accused-appellants are not eligible for
parole.34
On a final note, the Court observes that the RTC and
the CA failed to award civil indemnity as well as
damages to the family of the kidnap victim. In People
v. Quiachon,35 the Court explained that even if the
death penalty was not to be imposed on accused-
appellants in view of the prohibition in RA 9346, the
award of civil indemnity was nonetheless proper, not
being dependent on the actual imposition of the death
penalty but on the fact that qualifying circumstances
warranting the imposition of the death penalty attended
the commission of the crime.36 In the present case,
considering that both the qualifying circumstances of
ransom and the death of the victim during captivity
were duly alleged in the information and proven during
225
trial, civil indemnity in the amount of ₱100,000.00 must ESTELA M. PERLAS-BERNABE 5 Id.
therefore be awarded to the family of the victim, to Associate Justice
6
conform with prevailing jurisprudence.37 Id. at 7-8.
WE CONUR:
7
Similarly, the Court finds that the award of moral "Virginio" in some parts of the records.
damages is warranted in this case. Under Article 2217 ANTONIO T. CARPIO
8
Associate Justice One of the original five (5) accused who died during
of the Civil Code, moral damages include physical
Chairperson trial, resulting in the dismissal of the case against him.
suffering, mental anguish, fright, serious anxiety,
(See CA rollo, p. 37.)
wounded feelings, moral shock and similar injury, while
Article 2219 of the same Code provides that moral MARIANO C. DEL
ARTURO D. BRION 9 See rollo, pp. 6 and 8-9.
damages may be recovered in cases of illegal CASTILLO
Associate Justice
detention. It cannot be denied, in this case, that the Associate Justice 10 Id. at 3.
kidnap victim‟s family suffered mental anguish, fright,
JOSE PORTUGAL PEREZ 11 Id. at 3 and 20.
and serious anxiety over the detention and eventually,
Associate Justice
the death of Edwin. As such, and in accordance with 12
prevailing jurisprudence,38 moral damages in the See id. at 9-12.
ATTESTATION
amount of ₱100,000.00 must perforce be awarded to 13 Records, p. 300, including the dorsal portion thereof.
the family of the victim. I attest that the conclusions in the above Resolution
had been reached in consultation before the case was 14CA rollo, pp. 36-99. Penned by Presiding Judge
Finally, exemplary damages must be awarded in this assigned to the writer of the opinion of the Court's Thelma Canlas Trinidad-Pe Aguirre.
case, in view of the confluence of the aforesaid Division.
qualifying circumstances and in order to deter others 15 See id. at 93-95.
from committing the same atrocious acts. In ANTONIO T. CARPIO
16
accordance with prevailing jurisprudence,39 therefore, Associate Justice Entitled "AN ACT PROHIBITING THE IMPOSITION
the Court awards exemplary damages in the amount of Chairperson, Second Division OF DEATH PENALTY IN THE PHILIPPINES."
₱100,000.00 to the family of the kidnap victim.
17
CERTIFICATION CA rollo, pp. 98-99.
In addition, interest at the rate of six percent (6%) per 18
annum shall be imposed on all damages awarded from Pursuant to Section 13, Article VIII of the Constitution, Id. at 97.
the date of finality of judgment until fully paid, pursuant and the Division Chairperson's Attestation, I certify that 19
the conclusions in the above Resolution had been Id. at 60.
to prevailing jurisprudence.40
reached in consultation before the case was assigned 20 Rollo, pp. 2-25.
WHEREFORE, the appeal is DISMISSED. The to the writer of the opinion of the Court's Division.
Decision dated February 15, 2013 of the Court of 21 Id. at 15-16.
Appeals in CA-G.R. CR-H.C. No. 02888 is hereby MARIA LOURDES P. A. SERENO
AFFIRMED with the MODIFICATION that all the Chief Justice 22 Id. at 18-19.
accusedappellants herein are equally found GUILTY of
23
the special complex crime of Kidnapping for Ransom See id. at 23-24.
with Homicide, and are sentenced to each suffer the 24
penalty of reclusion perpetua, without eligibility for See id. at 22-24.
Footnotes
parole, and to pay, jointly and severally, the family of 25People v. Mercado, 400 Phil. 37, 71 (2000). See also
the kidnap victim Edwin Navarro the following 1Rollo, pp. 2-25. Penned by Associate Justice Samuel People v. Lamsen, G.R. No. 198338, February 20,
amounts: (1) ₱100,000.00 as civil indemnity; (2) H. Gaerlan, with Associate Justices Rebecca De Guia- 2013, 691 SCRA 498, 505-506.
₱100,000.00 as moral damages; and (3) ₱100,000.00 Salvador and Apolinario D. Bruselas, Jr., concurring.
as exemplary damages, all with interest at the rate of 26 See CA Decision; rollo, pp. 16-19.
2
six percent (6%) per annum ·from the date of finality of Id. at 6-7.
27
judgment until fully paid. People v. Castro, 434 Phil. 206, 221 (2002).
3 See id. at 4-5.
28
SO ORDERED. People v. Buntag, 471 Phil. 82, 93 (2004).
4 Id. at 7.
29 Rollo, p. 23.
226
30 "[T]he above-named accused, conspiring together
and mutually helping one another, being then private
persons, did then and there by force and intimidation
willfully, unlawfully and feloniously with the use of
motor vehicle and superior strength take, carry and
deprive EDWIN NAVARRO Y ONA, of his liberty
against his will, for the purpose of extorting ransom as
in fact a demand of ₱15,000,000.00 was made as a
condition of the victim’s release and on the occasion
thereof, the death of the victim resulted." (Id. at 3;
emphasis and underscoring supplied).
31People v. Quimzon, G.R. No. 133541, April 14, 2004,
427 SCRA 261, 281, citing People v. Feliciano, 418
Phil. 88, 106 (2001).
32 Supra note 25.
33 Id. at 82-83.
34 Pursuant to Section 3 of RA 9346 which states that
"[p]ersons convicted of offenses punished with
reclusion perpetua, or whose sentences will be
reduced to reclusion perpetua, by reason of this Act,
shall not be eligible for parole under Act No. 4180,
otherwise known as the Indeterminate Sentence Law,
as amended." (See People v. Tadah, G.R. No. 186226,
February 1, 2012, 664 SCRA 744, 747; see also
People v. Lalog, G.R. No. 196753, April 21, 2014.)
35 532 Phil. 414 (2006).
36
Id. at 428.
37 See People v. Gambao, G.R. No. 172707, October
1, 2013.
38 See People v. Reyes, 600 Phil. 738, 788 (2009).
39 See id. at 787.
40
Peop e v. Dumadag, G.R. No. 176740, June 22,
2011, 652 SCRA 535, 550, citing People v. Galvez,
G.R. No. 181827, February 2, 2011, 641SCRA472,
485.
G.R. No. 189081, August 10, 2016
GLORIA S. DY, Petitioner, v. PEOPLE OF THE
PHILIPPINES, MANDY COMMODITIES CO., INC.,
REPRESENTED BY ITS PRESIDENT, WILLIAM
MANDY, Respondent.
DECISION
JARDELEZA, J.:
Our law states that every person criminally liable for a
felony is also civilly liable. This civil liability ex
delicto may be recovered through a civil action which,
under our Rules of Court, is deemed instituted with the
criminal action. While they are actions mandatorily
fused,1 they are, in truth, separate actions whose
existences are not dependent on each other. Thus, civil
liability ex delicto survives an acquittal in a criminal
case for failure to prove guilt beyond reasonable doubt.
However, the Rules of Court limits this mandatory
fusion to a civil action for the recovery of civil liability ex
delicto. It, by no means, includes a civil liability arising
from a different source of obligation, as in the case of
a contract. Where the civil liability is ex contractu, the
court hearing the criminal case has no authority to
award damages.
The Case
This is a Petition for Review on Certiorari under Rule
45 of the Rules of Court. Petitioner Gloria S. Dy
(petitioner) seeks the reversal of the decision of the
Court of Appeals (CA) dated February 25, 2009
(Assailed Decision)2 ordering her to pay Mandy
Commodities Company, Inc. (MCCI) in the amount of
P21,706,281.00.3chanrobleslaw
The Facts
Petitioner was the former General Manager of MCCL.
In the course of her employment, petitioner assisted
MCCI in its business involving several properties. One
such business pertained to the construction of
warehouses over a property (Numancia Property) that
MCCI leased from the Philippine National Bank (PNB).
Sometime in May 1996, in pursuit of MCCI's business,
petitioner proposed to William Mandy (Mandy),
President of MCCI, the purchase of a property owned
by Pantranco. As the transaction involved a large
amount of money, Mandy agreed to obtain a loan from
the International China Bank of Commerce (ICBC).
Petitioner represented that she could facilitate the
approval of the loan. True enough, ICBC granted a
loan to MCCI in the amount of P20,000,000.00,
evidenced by a promissory note. As security, MCCI
also executed a chattel mortgage over the warehouses
in the Numancia Property. Mandy entrusted petitioner
with the obligation to manage the payment of the
loan.4chanrobleslaw
In February 1999, MCCI received a notice of
foreclosure over the mortgaged property due to its
default in paying the loan obligation. 5 In order to
prevent the foreclosure, Mandy instructed petitioner to
facilitate the payment of the loan. MCCI, through
Mandy, issued 13 Allied Bank checks and 12 Asia Trust
227
Bank checks in varying amounts and in different dates
covering the period from May 18, 1999 to April 4,
2000.6 The total amount of the checks, which were all
payable to cash, was P21,706,281.00. Mandy
delivered the checks to petitioner. Mandy claims that
he delivered the checks with the instruction that
petitioner use the checks to pay the loan. 7 Petitioner,
on the other hand, testified that she encashed the
checks and returned the money to Mandy.8 ICBC
eventually foreclosed the mortgaged property as MCCI
continued to default in its obligation to pay. Mandy
claims that it was only at this point in time that he
discovered that not a check was paid to
ICBC.9chanrobleslaw
Thus, on October 7, 2002, MCCI, represented by
Mandy, filed a Compiamt-Affidavit for Estafa10 before
the Office of the City Prosecutor of Manila. On March
3, 2004, an Information11 was filed against petitioner
before the Regional Trial Court (RTC) Manila.
After a full-blown trial, the RTC Manila rendered a
decision12 dated November 11, 2005 (RTC Decision)
acquitting petitioner. The RTC Manila found that while
petitioner admitted that she received the checks, the
prosecution failed to establish that she was under any
obligation to deliver them to ICBC in payment of
MCCFs loan. The trial court made this finding on the
strength of Mandy's admission that he gave the checks
to petitioner with the agreement that she would encash
them. Petitioner would then pay ICBC using her own
checks. The trial court further made a finding that
Mandy and petitioner entered into a contract of
loan.13 Thus, it held that the prosecution failed to
establish an important element of the crime of estafa—
misappropriation or conversion. However, while the
RTC Manila acquitted petitioner, it ordered her to pay
the amount of the checks. The dispositive portion of the
RTC Decision states —
WHEREFORE, the prosecution having failed to
establish the guilt of the accused beyond reasonable
doubt, judgment is hereby rendered ACQUITTING the
accused of the offense charged. With costs de officio.
The accused is however civilly liable to the complainant
for the amount of P21,706,281.00.
SO ORDERED.14chanroblesvirtuallawlibrary
Petitioner filed an appeal15 of the civil aspect of the
RTC Decision with the CA. In the Assailed
Decision,16the CA found the appeal without merit. It
held that the acquittal of petitioner does not necessarily
absolve her of civil liability. The CA said that it is settled
that when an accused is acquitted on the basis of
reasonable doubt, courts may still find him or her civilly
liable if the evidence so warrant. The CA explained that
the evidence on record adequately prove that petitioner
received the checks as a loan from MCCI. Thus,
preventing the latter from recovering the amount of the
checks would constitute unjust enrichment. Hence, the
Assailed Decision ruled
WHEREFORE, in view of the foregoing, the appeal is
DENIED. The Decision dated November 11, 2005 of
the Regional Trial Court, Manila, Branch 33 in Criminal
Case No. 04-224294 which found Gloria Dy civilly
liable to William Mandy is AFFIRMED.
SO ORDERED.17chanroblesvirtuallawlibrary
The CA also denied petitioner's motion for
reconsideration in a resolution18 dated August 3, 2009.
Hence, this Petition for Review on Certiorari (Petition).
Petitioner argues that since she was acquitted for
failure of the prosecution to prove all the elements of
the crime charged, there was therefore no crime
committed.19 As there was no crime, any civil
liability ex delicto cannot be awarded.
The Issues
The central issue is the propriety of making a finding of
civil liability in a criminal case for estafa when the
accused is acquitted for failure of the prosecution to
prove all the elements of the crime charged.
The Ruling of the Court
We grant the petition.
Civil Liability Arising From Crime
Our laws recognize a bright line distinction between
criminal and civil liabilities. A crime is a liability against
the state. It is prosecuted by and for the state. Acts
considered criminal are penalized by law as a means
to protect the society from dangerous transgressions.
As criminal liability involves a penalty affecting a
person's liberty, acts are only treated criminal when the
law clearly says so. On the other hand, civil liabilities
take a less public and more private nature. Civil
liabilities are claimed through civil actions as a means
to enforce or protect a right or prevent or redress a
wrong.20 They do not carry with them the imposition of
imprisonment as a penalty. Instead, civil liabilities are
compensated in the form of damages.
Nevertheless, our jurisdiction recognizes that a crime
has a private civil component. Thus, while an act
considered criminal is a breach of law against the
State, our legal system allows for the recovery of civil
damages where there is a private person injured by a
criminal act. It is in recognition of this dual nature of a
criminal act that our Revised Penal Code provides that
every person criminally liable is also civilly liable.21 This
is the concept of civil liability ex delicto.
This is echoed by the New Civil Code when it
recognizes acts or omissions punished by law as a
separate source of obligation.22 This is reinforced by
Article 30 of the same code which refers to the filing of
a separate civil action to demand civil liability arising
from a criminal offense.23chanrobleslaw
The Revised Penal Code fleshes out this civil liability in
Article 10424 which states that it includes restitution,
reparation of damage caused and indemnification for
consequential damages.
Rules of procedure for criminal and civil actions
involving the same act or omission
The law and the rules of procedure provide for a
precise mechanism in instituting a civil action
pertaining to an act or omission which is also subject
of a criminal case. Our Rules of Court prescribes a kind
of fusion such that, subject to certain defined
qualifications, when a criminal action is instituted, the
civil action for the recovery of the civil liability arising
from the offense is deemed instituted as
well.25cralawredchanrobleslaw
However, there is an important difference between civil
and criminal proceedings that require a fine distinction
228
as to how these twin actions shall proceed. These two
proceedings involve two different standards of proof. A
criminal action requires proof of guilt beyond
reasonable doubt while a civil action requires a lesser
quantum of proof, that of preponderance of evidence.
This distinction also agrees with the essential principle
in our legal system that while a criminal liability carries
with it a corresponding civil liability, they are
nevertheless separate and distinct. In other words,
these two liabilities may co-exist but their existence is
not dependent on each other.26chanrobleslaw
The Civil Code states that when an accused in a
criminal prosecution is acquitted on the ground that his
guilt has not been proven beyond reasonable doubt, a
civil action for damages for the same act or omission
may be filed. In the latter case, only preponderance of
evidence is required.27 This is supported by the Rules
of Court which provides that the extinction of the
criminal action does not result in the extinction of the
corresponding civil action.28 The latter may only be
extinguished when there is a "finding in a final
judgment in the criminal action that the act or omission
from which the civil liability may arise did not
exist."29 Consistent with this, the Rules of Court
requires that in judgments of acquittal the court must
state whether "the evidence of the prosecution
absolutely failed to prove the guilt of the accused or
merely failed to prove his guilt beyond reasonable
doubt. In either case, the judgment shall determine if
the act or omission from which the civil liability might
arise did not exist."30chanrobleslaw
Thus, whether an exoneration from the criminal action
should affect the corresponding civil action depends on
the varying kinds of acquittal. In Manantan v. Court of
Appeals,31 we explained —
Our law recognizes two kinds of acquittal, with different
effects on the civil liability of the accused. First is an
acquittal on the ground that the accused is not the
author of the act or omission complained of. This
instance closes the door to civil liability, for a person
who has been found to be not the perpetrator of any
act or omission cannot and can never be held liable for
such act or omission. There being no delict civil
liability ex delicto is out of the question, and the civil
action, if any, which may be instituted must be based
on grounds other than the delict complained of. This is
the situation contemplated in Rule 111 of the Rules of
Court. The second instance is an acquittal based on
reasonable doubt on the guilt of the accused. In this
case, even if the guilt of the accused has not been
satisfactorily established, he is not exempt from civil
liability which may be proved by preponderance of
evidence only. This is the situation contemplated in
Article 29 of the Civil Code, where the civil action for
damages is "for the same act or omission." Although
the two actions have different purposes, the matters
discussed in the civil case are similar to those
discussed in the criminal case. However, the judgment
In the criminal proceeding cannot be read in evidence
In the civil action to establish any fact there determined,
even though both actions involve the same act or
omission. The reason for this rule is that the parties are
not the same and secondarily, different rules of
evidence are applicable. Hence, notwithstanding
herein petitioner's acquittal, the Court of Appeals in
determining whether Article 29 applied, was not
precluded from looking into the question of petitioner's
negligence or reckless
imprudence.32chanroblesvirtuallawlibrary
In Dayap v. Sendiong,33 we further said —
The acquittal of the accused does not automatically
preclude a judgment against him on the civil aspect of
the case. The extinction of the penal action does not
carry with it the extinction of the civil liability where: (a)
the acquittal is based on reasonable doubt as only
preponderance of evidence is required; (b) the court
declares that the liability of the accused is only civil;
and (c) the civil liability of the accused does not arise
from or is not based upon the crime of which the
accused is acquitted. However, the civil action based
on delict may be deemed extinguished if mere is a
finding on the final judgment in the criminal action that
the act or omission from which the civil liability may
arise did not exist or where the accused did not commit
the acts or omission imputed to
him.34chanroblesvirtuallawlibrary
Hence, a civil action filed for the purpose of enforcing
civil liability ex delicto, even if mandatorily instituted
with the corresponding criminal action, survives an
acquittal when it is based on the presence of
reasonable doubt. In these instances, while the
evidence presented does not establish the fact of the
crime with moral certainty, the civil action still prevails
for as long as the greater weight of evidence tilts in
favor of a finding of liability. This means that while the
mind of the court cannot rest easy in penalizing the
accused for the commission of a crime, it nevertheless
finds that he or she committed or omitted to perform
acts which serve as a separate source of obligation.
There is no sufficient proof that the act or omission is
criminal beyond reasonable doubt, but there is a
preponderance of evidence to show that the act or
omission caused injury which demands compensation.
Civil Liability Ex Delicto in Estafa Cases
Our laws penalize criminal fraud which causes damage
capable of pecuniary estimation through estafaunder
Article 315 of the Revised Penal Code. In general, the
elements of estafa are:ChanRoblesVirtualawlibrary
(1) That the accused defrauded another (a) by abuse
of confidence, or (b) by means of deceit; and
(2) That damage or prejudice capable of pecuniary
estimation is caused to the offended party or third
person.
The essence of the crime is the unlawful abuse of
confidence or deceit in order to cause damage. As this
Court previously held, "the element of fraud or bad faith
is indispensable."35 Our law abhors the act of
defrauding another person by abusing his trust or
deceiving him, such that, it criminalizes this kind of
fraud.
Article 315 of the Revised Penal Code identifies the
circumstances which constitute estafa. Article 315,
paragraph 1 (b) states that estafa is committed by
abuse of confidence —
Art. 315. Swindling (estafa) - x x x (b) By
misappropriating or converting, to the prejudice of
another, money, goods, or any other personal property
received by the offender in trust or on commission, or
for administration, or under any other obligation
involving the duty to make delivery of or to return the
same, even though such obligation be totally or
229
partially guaranteed by a bond; or by denying having
received such money, goods, or other property.
In this kind of estafa, the fraud which the law considers
as criminal is the act of misappropriation or conversion.
When the element of misappropriation or conversion is
missing, there can be no estafa. In such case, applying
the foregoing discussions on civil liability ex delicto,
there can be no civil liability as there is no act or
omission from which any civil liability may be sourced.
However, when an accused is acquitted because a
reasonable doubt exists as to the existence of
misappropriation or conversion, then civil liability may
still be awarded. This means that, while there is
evidence to prove fraud, such evidence does not
suffice to convince the court to the point of moral
certainty that the act of fraud amounts to estafa. As the
act was nevertheless proven, albeit without sufficient
proof justifying the imposition of any criminal penalty,
civil liability exists.
In this case, the RTC Manila acquitted petitioner
because the prosecution failed to establish by sufficient
evidence the element of misappropriation or
conversion. There was no adequate evidence to prove
that Mandy gave the checks to petitioner with the
instruction that she will use them to pay the ICBC loan.
Citing Mandy's own testimony in open court, the RTC
Manila held that when Mandy delivered the checks to
petitioner, their agreement was that it was a "sort of
loan."36 In the dispositive portion of the RTC Decision,
the RTC Manila ruled that the prosecution "failed to
establish the guilt of the accused beyond reasonable
doubt."37 It then proceeded to order petitioner to pay
the amount of the loan.
The ruling of the RTC Manila was affirmed by the CA.
It said that "[t]he acquittal of Gloria Dy is anchored on
the ground that her guilt was not proved beyond
reasonable doubt - not because she is not the author
of the act or omission complained of. x x x The trial
court found no trickery nor deceit in obtaining money
from the private complainant; instead, it concluded that
the money obtained was undoubtedly a loan." 38
Our jurisprudence on this matter diverges.
Earlier cases ordered the dismissal of the civil action
for recovery of civil liability ex delicto whenever there is
a finding that there was no estafa but rather an
obligation to pay under a contract. In People v.
Pantig,39 this Court affirmed the ruling of the lower
court acquitting Pantig, but revoked the portion
sentencing him to pay the offended party the amount
of money alleged to have been obtained through false
and fraudulent representations, thus —
The trial court found as a fact that the sum of P1,200,
ordered to be paid in the judgment of acquittal, was
received by the defendant-appellant as loan. This
finding is inconsistent with the existence of the criminal
act charged in the information. The liability of the
defendant for the return of the amount so received
arises from a civil contract, not from a criminal act,
and may not be enforced in the criminal case.
The portion of the judgment appealed from, which
orders the defendant-appellant to pay the sum of Pi
,200 to the offended party, is hereby revoked, without
prejudice to the filing of a civil action for the recovery of
the said amount.40chanroblesvirtuallawlibrary
This was also the import of the ruling in People v.
Singson.41 In that case, this Court found that "the
evidence [was] not sufficient to establish the existence
of fraud or deceit on the part of the accused. x x x And
when there is no proven deceit or fraud, there is no
crime of estafa."42 While we also said that the
established facts may prove Singson's civil liability
(obligation to pay under a contract of sale), we
nevertheless made no finding of civil liability because
"our mind cannot rest easy on the certainty of
guilt"43 considering the above finding. The dispositive
portion stated that Singson is acquitted "without
prejudice to any civil liability which may be established
in a civil case against her."44chanrobleslaw
However, our jurisprudence on the matter appears to
have changed in later years.
In Eusebio-Calderon v. People,45 this Court affirmed
the finding of the CA that Calderon "did not employ
trickery or deceit in obtaining money from the private
complainants, instead, it concluded that the money
obtained was undoubtedly loans for which [Calderon]
paid interest."46 Thus, this Court upheld Calderon's
acquittal of estafa, but found her civilly liable for the
principal amount borrowed from the private
complainants.47chanrobleslaw
The ruling was similar in People v. Cuyugan.48 In that
case, we acquitted Cuyugan of estafa for failure of the
prosecution to prove fraud. We held that the
transaction between Cuyugan and private
complainants was a loan to be used by Cuyugan in her
business. Thus, this Court ruled that Cuyugan has the
obligation, which is civil in character, to pay the amount
borrowed.49chanrobleslaw
We hold that the better rule in ascertaining civil liability
in estafa cases is that pronounced
in Pantig and Singson. The rulings in these cases are
more in accord with the relevant provisions of the Civil
Code, and the Rules of Court. They are also logically
consistent with this Court's pronouncement
in Manantan.
Under Pantig and Singson, whenever the elements
of estafa are not established, and that the delivery of
any personal property was made pursuant to a
contract, any civil liability arising from the estafa cannot
be awarded in the criminal case. This is because the
civil liability arising from the contract is not civil
liability ex delicto, which arises from the same act or
omission constituting the crime. Civil liability ex
delicto is the liability sought to be recovered in a civil
action deemed instituted with the criminal case.
The situation envisioned in the foregoing cases, as in
this case, is civil liability ex contractu where the civil
liability arises from an entirely different source of
obligation. Therefore, it is not the type of civil action
deemed instituted in the criminal case, and
consequently must be filed separately. This is
necessarily so because whenever the court makes a
finding that the elements of estafa do not exist, it
effectively says that there is no crime. There is no act
or omission that constitutes criminal fraud. Civil
liability ex delicto cannot be awarded as it cannot be
sourced from something that does not exist.
When the court finds that the source of obligation is in
fact, a contract, as in a contract of loan, it takes a
position completely inconsistent with the presence
of estafa. In estafa, a person parts with his money
because of abuse of confidence or deceit. In a contract,
a person willingly binds himself or herself to give
something or to render some service.50 In estafa, the
230
accused's failure to account for the property received
amounts to criminal fraud. In a contract, a party's failure
to comply with his obligation is only a contractual
breach. Thus, any finding that the source of obligation
is a contract negates estafa. The finding, in turn,
means that there is no civil liability ex delicto. Thus, the
rulings in the foregoing cases are consistent with the
concept of fused civil and criminal actions, and the
different sources of obligations under our laws.
We apply this doctrine to the facts of this case.
Petitioner was acquitted by the RTC Manila because of
the absence of the element of misappropriation or
conversion. The RTC Manila, as affirmed by the CA,
found that Mandy delivered the checks to petitioner
pursuant to a loan agreement. Clearly, there is no
crime of estafa. There is no proof of the presence of
any act or omission constituting criminal fraud. Thus,
civil liability ex delicto cannot be awarded because
there is no act or omission punished by law which can
serve as the source of obligation. Any civil liability
arising from the loan takes the nature of a civil
liability ex contractu. It does not pertain to the civil
action deemed instituted with the criminal case.
In Manantan, this Court explained the effects of this
result on the civil liability deemed instituted with the
criminal case. At the risk of repetition, Manantan held
that when there is no delict, "civil liability ex delicto is
out of the question, and the civil action, if any, which
may be instituted must be based on grounds other than
the delict complained of."51 In Dy's case, the civil
liability arises out of contract—a different source of
obligation apart from an act or omission punished by
law—and must be claimed in a separate civil action.
Violation of Due Process
We further note that the evidence on record never fully
established the terms of this loan contract. As the trial
before the RTC Manila was focused on proving estafa,
the loan contract was, as a consequence, only
tangentially considered. This provides another
compelling reason why the civil liability arising from the
loan should be instituted in a separate civil case. A civil
action for collection of sum of money filed before the
proper court will provide for a better venue where the
terms of the loan and other relevant details may be
received. While this may postpone a warranted
recovery of the civil liability, this Court deems it more
important to uphold the principles underlying the
inherent differences in the various sources of
obligations under our law, and the rule that fused
actions only refer to criminal and civil actions involving
the same act or omission. These legal tenets play a
central role in this legal system. A confusion of these
principles will ultimately jeopardize the interests of the
parties involved. Actions focused on proving estafa is
not the proper vehicle to thresh out civil liability arising
from a contract.52 The Due Process Clause of the
Constitution dictates that a civil liability arising from a
contract must be litigated in a separate civil action.
Section 1 of the Bill of Rights states that no person shall
be deprived of property without due process of law.
This provision protects a person's right to both
substantive and procedural due process. Substantive
due process looks into the validity of a law and protects
against arbitrariness.53 Procedural due process, on the
other hand, guarantees procedural fairness.54 It
requires an ascertainment of "what process is due,
when it is due, and the degree of what is due." 55 This
aspect of due process is at the heart of this case.
In general terms, procedural due process means the
right to notice and hearing.56 More specifically, our
Rules of Court provides for a set of procedures through
which a person may be notified of the claims against
him or her as well as methods through which he or she
may be given the adequate opportunity to be heard.
The Rules of Court requires that any person invoking
the power of the judiciary to protect or enforce a right
or prevent or redress a wrong57 must file an initiatory
pleading which embodies a cause of action, 58which is
defined as the act or omission by which a party violates
a right of another.59 The contents of an initiatory
pleading alleging a cause of action will vary depending
on the source of the obligation involved. In the case of
an obligation arising from a contract, as in this case,
the cause of action in an initiatory pleading will involve
the duties of the parties to the contract, and what
particular obligation was breached. On the other hand,
when the obligation arises from an act or omission
constituting a crime, the cause of action must
necessarily be different. In such a case, the initiatory
pleading will assert as a cause of action the act or
omission of respondent, and the specific criminal
statute he or she violated. Where the initiatory pleading
fails to state a cause of action, the respondent may file
a motion to dismiss even before trial.60 These rules
embody the fundamental right to notice under the Due
Process Clause of the Constitution.
In a situation where a court (in a fused action for the
enforcement of criminal and civil liability) may validly
order an accused-respondent to pay an obligation
arising from a contract, a person's right to be notified of
the complaint, and the right to have the complaint
dismissed if there is no cause of action, are completely
defeated. In this event, the accused-respondent is
completely unaware of the nature of the liability
claimed against him or her at the onset of the case. The
accused-respondent will not have read any complaint
stating the cause of action of an obligation arising from
a contract. All throughout the trial, the accused-
respondent is made to believe that should there be any
civil liability awarded against him or her, this liability is
rooted from the act or omission constituting the crime.
The accused-respondent is also deprived of the
remedy of having the complaint dismissed through a
motion to dismiss before trial. In a fused action, the
accused-respondent could not have availed of this
remedy because he or she was not even given an
opportunity to ascertain what cause of action to look for
in the initiatory pleading. In such a case, the accused-
respondent is blindsided. He or she could not even
have prepared the appropriate defenses and evidence
to protect his or her interest. This is not the concept of
fair play embodied in the Due Process Clause. It is a
clear violation of a person's right to due process.
The Rules of Court also allows a party to a civil action
certain remedies that enable him or her to effectively
present his or her case. A party may file a cross-claim,
a counterclaim or a third-party complaint.61 The Rules
of Court prohibits these remedies in a fused civil and
criminal case.62 The Rules of Court requires that any
cross-claim, counterclaim or third-party complaint must
be instituted in a separate civil action.63 In a legal
regime where a court may order an accused in a fused
action to pay civil liability arising from a contract, the
accused-respondent is completely deprived of the
remedy to file a cross-claim, a counterclaim or a third-
party complaint. This—coupled with an accused-
respondent's inability to adequately prepare his or her
defense because of lack of adequate notice of the
231
claims against him or her—prevents the accused-
respondent from having any right to a meaningful
hearing. The right to be heard under the Due Process
Clause requires not just any kind of an opportunity to
be heard. It mandates that a party to a case must have
the chance to be heard in a real and meaningful sense.
It does not require a perfunctory hearing, but a court
proceeding where the party may adequately avail of
the procedural remedies granted to him or her. A court
decision resulting from this falls short of the mandate
of the Due Process Clause.
Indeed, the language of the Constitution is clear. No
person shall be deprived of property without due
process of law. Due Process, in its procedural sense,
requires, in essence, the right to notice and hearing.
These rights are further fleshed out in the Rules of
Court. The Rules of Court enforces procedural due
process because, to repeat the words of this Court
in Secretary of Justice v. Lantion, it provides for "what
process is due, when it is due, and the degree of what
is due."64 A court ordering an accused in a fused action
to pay his or her contractual liability deprives him or her
of his or her property without the right to notice and
hearing as expressed in the procedures and remedies
under the Rules of Court. Thus, any court ruling
directing an accused in a fused action to pay civil
liability arising from a contract is one that completely
disregards the Due Process Clause. This ruling must
be reversed and the Constitution upheld.
Conclusion
The lower courts erred when they ordered petitioner to
pay her civil obligation arising from a contract of loan in
the same criminal case where she was acquitted on the
ground that there was no crime. Any contractual
obligation she may have must be litigated in a separate
civil action involving the contract of loan. We clarify that
in cases where the accused is acquitted on the ground
that there is no crime, the civil action deemed instituted
with the criminal case cannot prosper precisely
because there is no delict from which any civil
obligation may be sourced. The peculiarity of this case
is the finding that petitioner, in fact, has an obligation
arising from a contract. This civil action arising from the
contract is not necessarily extinguished. It can be
instituted in the proper court through the proper civil
action.
been completed. This possibility demands that
We note that while there is no written contract of loan prospective litigants do not haphazardly pursue the
in this case, there is an oral contract of loan which must filing of an estafa case in order to force an obligor to
be brought within six years.65 Under the facts of the pay his or her obligation with the threat of criminal
case, it appears that any breach in the obligation to pay conviction. It compels litigants to be honest and fair in
the loan may have happened between 1996 and 1999, their judgment as to the proper action to be filed. This
or more than six years since this case has been ruling should deter litigants from turning to criminal
instituted. This notwithstanding, we find that the civil courts as their collection agents, and should provide a
action arising from the contract of loan has not yet disincentive to the practice of filing of criminal cases
prescribed. Article 1150 of the Civil Code states — based on unfounded grounds in order to provide a
litigant a bargaining chip in enforcing contracts.
Art. 1150. The time for prescription for all kinds of
actions, when there is no special provision which WHEREFORE, in view of the foregoing, the Petition
ordains otherwise, shall be counted from the day they is GRANTED. The Decision of the CA dated February
may be brought. 25, 2009 is REVERSED. This is however, without
prejudice to any civil action which may be filed to claim
We held in numerous cases that it is the legal
civil liability arising from the contract.
possibility of bringing the action that determines the
starting point for the computation of the period of SO ORDERED.
prescription.67 We highlight the unique circumstances
surrounding this case. As discussed in this decision,
Velasco, Jr., (Chairperson), Peralta, Perez,
there has been diverse jurisprudence as to the
and Reyes, JJ., concur.
propriety of ordering an accused to pay an obligation
arising from a contract in the criminal case where the Endnotes:
accused was acquitted on the ground that there is no
crime. Litigants, such as MCCI, cannot be blamed for
relying on prior rulings where the recovery on a
1
contract of loan in a criminal case for estafawas Bautista, The Confusing Fusion of A Civil Claim In a
allowed. We have found the opportunity to clarify this Criminal Proceeding, 79 Phil. L.J 640 (2004), pp. 361-
matter through this decision. As it is only now that we 401.
delineate the rules governing the fusion of criminal and
civil actions pertaining to estafa, it is only upon the 2Penned by Arcangelita M. Romilla-Lontok and
promulgation of this judgment that litigants have a clear concurred in by Associate Justices Josefina Guevara-
understanding of the proper recourse in similar cases. Salonga and Romeo F. Barza, rollo, pp. 39-48.
We therefore rule that insofar as MCCI is concerned,
3Id.
the filing of an action, if any (that may be sourced from at 41, 48.
the contract of loan), becomes a legal possibility only
4
upon the finality of this decision which definitively ruled Records, pp. 407-409.
upon the principles on fused actions.
5Id.
at 409.
We add, however, that upon finality of this decision,
6Id.
prospective litigants should become more circumspect at 452-476.
in ascertaining their course of action in similar cases.
7
Whenever a litigant erroneously pursues TSN, July 12, 2004, p. 44.
an estafa case, and the accused is subsequently
8
acquitted because the obligation arose out of a TSN, May 4, 2005, p. 32.
contract, the prescriptive period will still be counted
9
from the time the cause of action arose. In this Records, pp. 409-410.
eventuality, it is probable that the action has already
prescribed by the time the criminal case shall have
232
10Id. at 13-23. 1. Restitution; and decided jointly.
11Id. at 1-3. 2. Reparation of the damage caused; During the pendency of the criminal action, the running
of the period of prescription of the civil action which
12Id. at 406-417. 3. Indemnification for consequential damages. cannot be instituted separately or whose proceeding
has been suspended shall be tolled.
25cralawred
13Id. at 415-416. RULES OF COURT, Rule 111, Sec. 1, par.
(a). See also footnote 1. The extinction of the penal action does not carry with it
14Id. at 417. extinction of the civil action. However, the civil action
26Supra note 1. based on delict may be deemed extinguished if there
15Rollo, pp. 68-259. is a finding in a final judgment in the criminal action that
27 CIVIL CODE, Art. 29. When the accused in a the act or omission from which the civil liability may
16Supra note 2. criminal prosecution is acquitted on the ground that his arise did not exist.
guilt has not been proved beyond reasonable doubt, a
17Rollo, p. 48, emphasis in the original. civil action for damages for the same act or omission 29Id.
may be instituted. Such action requires only a
18Id. at 67. preponderance of evidence. Upon motion of the 30 RULES OF COURT, Rule 120, Sec. 2.
defendant, the court may require the plaintiff to file a
19Id. at 21-27. bond to answer for damages in case the complaint 31 G.R. No. 107125, January 29, 2001, 350 SCRA 387.
should be found to be malicious.
20 32Id.
RULES OF COURT, Rule 1, Sec. 3, par. (a). at 397-398.
If in a criminal case the judgment of acquittal is based
21 REVISED PENAL CODE, Art. 100. upon reasonable doubt, the court shall so declare. In 33 G.R. No. 177960, January 29, 2009, 577 SCRA 134.
the absence of any declaration to that effect, it may be
22 CIVIL CODE, Art. 1157. Obligations arise inferred from the text of the decision whether or not the 34Id. at 148.
from:ChanRoblesVirtualawlibrary acquittal is due to that ground.
35
People v. Singson, G.R. No. 75920, November 12,
28
1. Law; RULES OF COURT, Rule 113, Sec. 2. When 1992, 215 SCRA 534, 538.
separate civil action is suspended. — After the criminal
2. Contracts; action has been commenced, the separate civil action 36 Records, pp. 415-416.
arising therefrom cannot be instituted until final
3. Quasi-contracts; judgment has been entered in the criminal action. 37Id. at 417.

4. Acts or omissions/punished by law; If the criminal action is filed after the said civil action 38Rollo, p. 45.
and cralawlawlibrary has already been instituted, the latter shall be
suspended in whatever stage it may be found before 39 97 Phil. 748 (1955).
5. Quasi-delicts. judgment on the merits. The suspension shall last until
final judgment is rendered in the criminal action. 40Id. at 750, Emphasis supplied.
23 CIVIL CODE, Art. 30. When a separate civil action is Nevertheless, before judgment on the merits is
brought to demand civil liability arising from a criminal rendered in the civil action, the same may, upon motion 41G.R. No. 75920, November 12, 1992, 215 SCRA
offense, and no criminal proceedings are instituted of the offended party, be consolidated with the criminal 534.
during the pendency of the civil case, a preponderance action in the court trying the criminal action. In case of
of evidence shall likewise be sufficient to prove the act consolidation, the evidence already adduced in the civil 42Id. at 538-539.
complained of. action shall be deemed automatically reproduced in the
criminal action without prejudice to the right of the 43Id. at 539.
24 REVISED PENAL CODE, Art. 104. What is included prosecution to cross-examine the witnesses presented
in civil liability. — The civil liability established in articles by the offended party in the criminal case and of the 44Id.
See also United States v. Ador Dionisio, 35 Phil.
100, 101, 102 and 103 of this Code parties to present additional evidence. The 141, 143-144 (1916). In this case, while this Court
includes:ChanRoblesVirtualawlibrary consolidated criminal and civil actions shall be tried convicted the accused for estafa, it refused to order

233
him to pay the civil liabilities claimed by private
complainant, explaining that — 55Secretary of Justice v. Lantion, G.R. No. 139465,
October 17, 2000, 343 SCRA 377, 392.
But the amount of the hire cannot be recovered by way
56Secretary
of civil damages in these proceedings. The amount due of Justice v. Lantion, G.R. No. 139465,
under the rental contract may properly be recovered in January 18, 2000, 322 SCRA 160.
a separate civil action; but it cannot be held to be
included in the civil damages (perjuicios) arising out of 57 RULES OF COURT, Rule 1, Sec. 3, par. (a).
the crime of estafa of which the accused is convicted
in this criminal action. (Art. 119, Penal Code.) 58 RULES OF COURT, Rule 1, Sec. 5; Rule 2, Sec. 1.

xxx 59 RULES OF COURT, Rule 2, Sec. 1.

60 RULES OF COURT, Rule 36, Sec. 1, par. (g).
x x x The indebtedness under the rental contract
was and is a thing wholly apart from and 61 RULES Of COURT, Rule 6, Secs. 8, 9 & 11.
independent of the crime of estafa committed by
the accused. No direct causal relation can be traced 62 RULES of COURT, Rule 111, Sec. 1, par. (a).
between them, and in the absence of such a relation, a
judgment for the amount of the indebtedness, with 63Id.
subsidiary imprisonment in case of insolvency and
failure to pay the amount of the judgment, cannot 64Supra note 55.
properly be included in a judgment in the criminal
action for the civil damages (perjuicios) arising from or 65CIVIL CODE, Art. 1145. The following actions must
consequent upon the commission of the crime of which
be commenced within six years:
the accused is convicted. (Emphasis supplied.)
45 chanRoblesvirtualLawlibrary1. Upon an oral contract;
G.R. No. 158495, October 21, 2004, 441 SCRA 137.
46Id. x x x
at 147.
67Espanol
47Id. v. Chairman, Philippine Veterans
at 149, with modification on the amount of the civil
Administration, G.R. No. L-44616, June 29, 1985, 137
liability.
SCRA 314; Tolentino v. Court of Appeals, G.R. No. L-
48 41427, June 10, 1988, 162 SCRA 66; Khe Hong
G.R. Nos. 146641-43, November 18, 2002, 392
Cheng v. Court of Appeals, G.R. No. 144169, March
SCRA 140.
28, 2001, 355 SCRA 701.
49Id. at 151.
50 CIVIL CODE, Art. 1305.
51Supra note 31 at 397.
52 See the dissenting opinion of Justice Johns in Wise
& Co. v. Larion, 45 Phil. 314 (1923).
53Gamboa v. Teves, G.R. No. 176579, June 28, 2011,
652 SCRA 690.
54Id.

234
 This is an original action instituted in this court on
August 19, 1937, for the issuance of the writ
of certiorari and of prohibition to the Court of First
Instance of Manila so that this court may review the
actuations of the aforesaid Court of First Instance in
criminal case No. 42649 entitled "The People of the
Philippine Islands vs. Mariano Cu Unjieng, et al.", more
particularly the application of the defendant Mariano
Cu Unjieng therein for probation under the provisions
of Act No. 4221, and thereafter prohibit the said Court
of First Instance from taking any further action or
entertaining further the aforementioned application for
probation, to the end that the defendant Mariano Cu
Unjieng may be forthwith committed to prison in
accordance with the final judgment of conviction
rendered by this court in said case (G. R. No. 41200). 1

Petitioners herein, the People of the Philippine and the

Hongkong and Shanghai Banking Corporation, are
respectively the plaintiff and the offended party, and
the respondent herein Mariano Cu Unjieng is one of the
defendants, in the criminal case entitled "The People
of the Philippine Islands vs. Mariano Cu Unjieng, et al.",
criminal case No. 42649 of the Court of First Instance
of Manila and G.R. No. 41200 of this court.
Respondent herein, Hon. Jose O. Vera, is the
Judge ad interim of the seventh branch of the Court of
G.R. No. L-45685 November 16, 1937 First Instance of Manila, who heard the application of
the defendant Mariano Cu Unjieng for probation in the
THE PEOPLE OF THE PHILIPPINE ISLANDS and aforesaid criminal case.
HONGKONG & SHANGHAI BANKING
CORPORATION,petitioners, The information in the aforesaid criminal case was filed
vs. with the Court of First Instance of Manila on October
JOSE O. VERA, Judge . of the Court of First 15, 1931, petitioner herein Hongkong and Shanghai
Instance of Manila, and MARIANO CU Banking Corporation intervening in the case as private
UNJIENG, respondents. prosecutor. After a protracted trial unparalleled in the
annals of Philippine jurisprudence both in the length of
Office of the Solicitor General Tuason and City Fiscal time spent by the court as well as in the volume in the
Diaz for the Government. testimony and the bulk of the exhibits presented, the
De Witt, Perkins and Ponce Enrile for the Hongkong Court of First Instance of Manila, on January 8, 1934,
and Shanghai Banking Corporation. rendered a judgment of conviction sentencing the
Vicente J. Francisco, Feria and La O, Orense and defendant Mariano Cu Unjieng to indeterminate
Belmonte, and Gibbs and McDonough for respondent penalty ranging from four years and two months of
Cu Unjieng. prision correccional to eight years of prision mayor, to
No appearance for respondent Judge. pay the costs and with reservation of civil action to the
offended party, the Hongkong and Shanghai Banking
Corporation. Upon appeal, the court, on March 26,
1935, modified the sentence to an indeterminate
penalty of from five years and six months of prision
LAUREL, J.:
correccional to seven years, six months and twenty-
235
seven days of prision mayor, but affirmed the judgment
in all other respects. Mariano Cu Unjieng filed a motion
for reconsideration and four successive motions for
new trial which were denied on December 17, 1935,
and final judgment was accordingly entered on
December 18, 1935. The defendant thereupon sought
to have the case elevated on certiorari to the Supreme
Court of the United States but the latter denied the
petition for certiorari in November, 1936. This
court, on November 24, 1936, denied the
petition subsequently filed by the defendant for leave
to file a second alternative motion for reconsideration
or new trial and thereafter remanded the case to the
court of origin for execution of the judgment.
The instant proceedings have to do with the application
for probation filed by the herein respondent Mariano Cu
Unjieng on November 27, 1936, before the trial
court, under the provisions of Act No. 4221 of the
defunct Philippine Legislature. Herein respondent
Mariano Cu Unjieng states in his petition, inter alia, that
he is innocent of the crime of which he was convicted,
that he has no criminal record and that he would
observe good conduct in the future. The Court of First
Instance of Manila, Judge Pedro Tuason presiding,
referred the application for probation of the Insular
Probation Office which recommended denial of the
same June 18, 1937. Thereafter, the Court of First
Instance of Manila, seventh branch, Judge Jose O.
Vera presiding, set the petition for hearing on April 5,
1937.
On April 2, 1937, the Fiscal of the City of Manila filed
an opposition to the granting of probation to the herein
respondent Mariano Cu Unjieng. The private
prosecution also filed an opposition on April 5, 1937,
alleging, among other things, that Act No. 4221,
assuming that it has not been repealed by section 2 of
Article XV of the Constitution, is nevertheless violative
of section 1, subsection (1), Article III of the
Constitution guaranteeing equal protection of the laws
for the reason that its applicability is not uniform
throughout the Islands and because section 11 of the
said Act endows the provincial boards with the power
to make said law effective or otherwise in their
respective or otherwise in their respective provinces.
The private prosecution also filed a supplementary
opposition on April 19, 1937, elaborating on the alleged
unconstitutionality on Act No. 4221, as an undue
delegation of legislative power to the provincial boards
of several provinces (sec. 1, Art. VI, Constitution). The
City Fiscal concurred in the opposition of the private
prosecution except with respect to the questions raised
concerning the constitutionality of Act No. 4221.
On June 28, 1937, herein respondent Judge Jose O.
Vera promulgated a resolution with a finding that "las
pruebas no han establecido de unamanera
concluyente la culpabilidad del peticionario y que todos
los hechos probados no son inconsistentes o
incongrentes con su inocencia" and concludes that the
herein respondent Mariano Cu Unjieng "es inocente
por duda racional" of the crime of which he stands
convicted by this court in G.R. No. 41200, but denying
the latter's petition for probation for the reason that:
. . . Si este Juzgado concediera la poblacion solicitada
por las circunstancias y la historia social que se han
expuesto en el cuerpo de esta resolucion, que hacen
al peticionario acreedor de la misma, una parte de la
opinion publica, atizada por los recelos y las
suspicacias, podria levantarse indignada contra un
sistema de probacion que permite atisbar en los
procedimientos ordinarios de una causa criminal
perturbando la quietud y la eficacia de las decisiones
ya recaidas al traer a la superficie conclusiones
enteramente differentes, en menoscabo del interes
publico que demanda el respeto de las leyes y del
veredicto judicial.
On July 3, 1937, counsel for the herein respondent
Mariano Cu Unjieng filed an exception to the resolution
denying probation and a notice of intention to file a
motion for reconsideration. An alternative motion for
reconsideration or new trial was filed by counsel on
July 13, 1937. This was supplemented by an additional
motion for reconsideration submitted on July 14, 1937.
The aforesaid motions were set for hearing on July 31,
1937, but said hearing was postponed at the petition of
counsel for the respondent Mariano Cu Unjieng
because a motion for leave to intervene in the case
as amici curiae signed by thirty-three (thirty-four)
attorneys had just been filed with the trial court.
Attorney Eulalio Chaves whose signature appears in
the aforesaid motion subsequently filed a petition for
leave to withdraw his appearance as amicus curiae on
the ground that the motion for leave to intervene
as amici curiae was circulated at a banquet given by
counsel for Mariano Cu Unjieng on the evening of July
30, 1937, and that he signed the same "without mature
deliberation and purely as a matter of courtesy to the
person who invited me (him)."
On August 6, 1937, the Fiscal of the City of Manila filed
a motion with the trial court for the issuance of an order
of execution of the judgment of this court in said case
and forthwith to commit the herein respondent Mariano
Cu Unjieng to jail in obedience to said judgment.
On August 7, 1937, the private prosecution filed its
opposition to the motion for leave to intervene as amici
curiae aforementioned, asking that a date be set for a
hearing of the same and that, at all events, said motion
should be denied with respect to certain attorneys
signing the same who were members of the legal staff
of the several counsel for Mariano Cu Unjieng. On
August 10, 1937, herein respondent Judge Jose O.
Vera issued an order requiring all parties including the
movants for intervention as amici curiae to appear
before the court on August 14, 1937. On the last-
mentioned date, the Fiscal of the City of Manila moved
for the hearing of his motion for execution of judgment
in preference to the motion for leave to intervene
as amici curiae but, upon objection of counsel for
Mariano Cu Unjieng, he moved for the postponement
of the hearing of both motions. The respondent judge
thereupon set the hearing of the motion for execution
on August 21, 1937, but proceeded to consider the
motion for leave to intervene as amici curiae as in
order. Evidence as to the circumstances under which
said motion for leave to intervene as amici curiae was
signed and submitted to court was to have been heard
on August 19, 1937. But at this juncture, herein
petitioners came to this court on extraordinary legal
process to put an end to what they alleged was an
interminable proceeding in the Court of First Instance
of Manila which fostered "the campaign of the
defendant Mariano Cu Unjieng for delay in the
execution of the sentence imposed by this Honorable
Court on him, exposing the courts to criticism and
ridicule because of the apparent inability of the judicial
machinery to make effective a final judgment of this
court imposed on the defendant Mariano Cu Unjieng."
The scheduled hearing before the trial court was
accordingly suspended upon the issuance of a
temporary restraining order by this court on August 21,
1937.
236
To support their petition for the issuance of the
extraordinary writs of certiorari and prohibition, herein
petitioners allege that the respondent judge has acted
without jurisdiction or in excess of his jurisdiction:
I. Because said respondent judge lacks the power to
place respondent Mariano Cu Unjieng under probation
for the following reason:
(1) Under section 11 of Act No. 4221, the said of the
Philippine Legislature is made to apply only to the
provinces of the Philippines; it nowhere states that it is
to be made applicable to chartered cities like the City
of Manila.
(2) While section 37 of the Administrative Code
contains a proviso to the effect that in the absence of a
special provision, the term "province" may be
construed to include the City of Manila for the purpose
of giving effect to laws of general application, it is also
true that Act No. 4221 is not a law of general
application because it is made to apply only to those
provinces in which the respective provincial boards
shall have provided for the salary of a probation officer.
(3) Even if the City of Manila were considered to be a
province, still, Act No. 4221 would not be applicable to
it because it has provided for the salary of a probation
officer as required by section 11 thereof; it being
immaterial that there is an Insular Probation Officer
willing to act for the City of Manila, said Probation
Officer provided for in section 10 of Act No. 4221 being
different and distinct from the Probation Officer
provided for in section 11 of the same Act.
II. Because even if the respondent judge originally had
jurisdiction to entertain the application for probation of
the respondent Mariano Cu Unjieng, he nevertheless
acted without jurisdiction or in excess thereof in
continuing to entertain the motion for reconsideration
and by failing to commit Mariano Cu Unjieng to prison
after he had promulgated his resolution of June 28,
1937, denying Mariano Cu Unjieng's application for
probation, for the reason that:
(1) His jurisdiction and power in probation proceedings
is limited by Act No. 4221 to the granting or denying of
applications for probation.
(2) After he had issued the order denying Mariano Cu
Unjieng's petition for probation on June 28, 1937, it
became final and executory at the moment of its
rendition.
(3) No right on appeal exists in such cases.
(4) The respondent judge lacks the power to grant a
rehearing of said order or to modify or change the
same.
III. Because the respondent judge made a finding that
Mariano Cu Unjieng is innocent of the crime for which
he was convicted by final judgment of this court, which
finding is not only presumptuous but without foundation
in fact and in law, and is furthermore in contempt of this
court and a violation of the respondent's oath of office
as ad interim judge of first instance.
IV. Because the respondent judge has violated and
continues to violate his duty, which became imperative
when he issued his order of June 28, 1937, denying the
application for probation, to commit his co-respondent
to jail.
Petitioners also avers that they have no other plain,
speedy and adequate remedy in the ordinary course of
law.
In a supplementary petition filed on September 9,
1937, the petitioner Hongkong and Shanghai Banking
Corporation further contends that Act No. 4221 of the
Philippine Legislature providing for a system of
probation for persons eighteen years of age or over
who are convicted of crime, is unconstitutional because
it is violative of section 1, subsection (1), Article III, of
the Constitution of the Philippines guaranteeing equal
protection of the laws because it confers upon the
provincial board of its province the absolute discretion
to make said law operative or otherwise in their
respective provinces, because it constitutes an
unlawful and improper delegation to the provincial
boards of the several provinces of the legislative power
lodged by the Jones Law (section 8) in the Philippine
Legislature and by the Constitution (section 1, Art. VI)
in the National Assembly; and for the further reason
that it gives the provincial boards, in contravention of
the Constitution (section 2, Art. VIII) and the Jones Law
(section 28), the authority to enlarge the powers of the
Court of First Instance of different provinces without
uniformity. In another supplementary petition dated
September 14, 1937, the Fiscal of the City of Manila, in
behalf of one of the petitioners, the People of the
Philippine Islands, concurs for the first time with the
issues raised by other petitioner regarding the
constitutionality of Act No. 4221, and on the oral
argument held on October 6, 1937, further elaborated
on the theory that probation is a form of reprieve and
therefore Act. No. 4221 is an encroachment on the
exclusive power of the Chief Executive to grant
pardons and reprieves. On October 7, 1937, the City
Fiscal filed two memorandums in which he contended
that Act No. 4221 not only encroaches upon the
pardoning power to the executive, but also constitute
an unwarranted delegation of legislative power and a
denial of the equal protection of the laws. On October
9, 1937, two memorandums, signed jointly by the City
Fiscal and the Solicitor-General, acting in behalf of the
People of the Philippine Islands, and by counsel for the
petitioner, the Hongkong and Shanghai Banking
Corporation, one sustaining the power of the state to
impugn the validity of its own laws and the other
contending that Act No. 4221 constitutes an
unwarranted delegation of legislative power, were
presented. Another joint memorandum was filed by the
same persons on the same day, October 9, 1937,
alleging that Act No. 4221 is unconstitutional because
it denies the equal protection of the laws and
constitutes an unlawful delegation of legislative power
and, further, that the whole Act is void: that the
Commonwealth is not estopped from questioning the
validity of its laws; that the private prosecution may
intervene in probation proceedings and may attack the
probation law as unconstitutional; and that this court
may pass upon the constitutional question in
prohibition proceedings.
Respondents in their answer dated August 31, 1937,
as well as in their oral argument and memorandums,
challenge each and every one of the foregoing
proposition raised by the petitioners.
As special defenses, respondents allege:
(1) That the present petition does not state facts
sufficient in law to warrant the issuance of the writ
of certiorari or of prohibition.
(2) That the aforesaid petition is premature because
the remedy sought by the petitioners is the very same
remedy prayed for by them before the trial court and
237
was still pending resolution before the trial court when
the present petition was filed with this court.
(3) That the petitioners having themselves raised the
question as to the execution of judgment before the
trial court, said trial court has acquired exclusive
jurisdiction to resolve the same under the theory that
its resolution denying probation is unappealable.
(4) That upon the hypothesis that this court has
concurrent jurisdiction with the Court of First Instance
to decide the question as to whether or not the
execution will lie, this court nevertheless cannot
exercise said jurisdiction while the Court of First
Instance has assumed jurisdiction over the same upon
motion of herein petitioners themselves.
(5) That upon the procedure followed by the herein
petitioners in seeking to deprive the trial court of its
jurisdiction over the case and elevate the proceedings
to this court, should not be tolerated because it impairs
the authority and dignity of the trial court which court
while sitting in the probation cases is "a court of limited
jurisdiction but of great dignity."
(6) That under the supposition that this court has
jurisdiction to resolve the question submitted to and
pending resolution by the trial court, the present action
would not lie because the resolution of the trial court
denying probation is appealable; for although the
Probation Law does not specifically provide that an
applicant for probation may appeal from a resolution of
the Court of First Instance denying probation, still it is
a general rule in this jurisdiction that a final order,
resolution or decision of an inferior court is appealable
to the superior court.
(7) That the resolution of the trial court denying
probation of herein respondent Mariano Cu Unjieng
being appealable, the same had not become final and
executory for the reason that the said respondent had
filed an alternative motion for reconsideration and new
trial within the requisite period of fifteen days, which
motion the trial court was able to resolve in view of the
restraining order improvidently and erroneously issued
by this court.lawphi1.net
(8) That the Fiscal of the City of Manila had by
implication admitted that the resolution of the trial court
denying probation is not final and unappealable when
he presented his answer to the motion for
reconsideration and agreed to the postponement of the
hearing of the said motion.
(9) That under the supposition that the order of the trial
court denying probation is not appealable, it is
incumbent upon the accused to file an action for the
issuance of the writ of certiorari with mandamus, it
appearing that the trial court, although it believed that
the accused was entitled to probation, nevertheless
denied probation for fear of criticism because the
accused is a rich man; and that, before a petition
for certiorari grounded on an irregular exercise of
jurisdiction by the trial court could lie, it is incumbent
upon the petitioner to file a motion for reconsideration
specifying the error committed so that the trial court
could have an opportunity to correct or cure the same.
(10) That on hypothesis that the resolution of this court
is not appealable, the trial court retains its jurisdiction
within a reasonable time to correct or modify it in
accordance with law and justice; that this power to alter
or modify an order or resolution is inherent in the courts
and may be exercise either motu proprio or upon
petition of the proper party, the petition in the latter
case taking the form of a motion for reconsideration.
(11) That on the hypothesis that the resolution of the
trial court is appealable as respondent allege, said
court cannot order execution of the same while it is on
appeal, for then the appeal would not be availing
because the doors of probation will be closed from the
moment the accused commences to serve his
sentence (Act No. 4221, sec. 1; U.S. vs. Cook, 19 Fed.
[2d], 827).
In their memorandums filed on October 23, 1937,
counsel for the respondents maintain that Act No. 4221
is constitutional because, contrary to the allegations of
the petitioners, it does not constitute an undue
delegation of legislative power, does not infringe the
equal protection clause of the Constitution, and does
not encroach upon the pardoning power of the
Executive. In an additional memorandum filed on the
same date, counsel for the respondents reiterate the
view that section 11 of Act No. 4221 is free from
constitutional objections and contend, in addition, that
the private prosecution may not intervene in probation
proceedings, much less question the validity of Act No.
4221; that both the City Fiscal and the Solicitor-
General are estopped from questioning the validity of
the Act; that the validity of Act cannot be attacked for
the first time before this court; that probation in
unavailable; and that, in any event, section 11 of the
Act No. 4221 is separable from the rest of the Act. The
last memorandum for the respondent Mariano Cu
Unjieng was denied for having been filed out of time
but was admitted by resolution of this court and filed
anew on November 5, 1937. This memorandum
elaborates on some of the points raised by the
respondents and refutes those brought up by the
petitioners.
In the scrutiny of the pleadings and examination of the
various aspects of the present case, we noted that the
court below, in passing upon the merits of the
application of the respondent Mariano Cu Unjieng and
in denying said application assumed the task not only
of considering the merits of the application, but of
passing upon the culpability of the applicant,
notwithstanding the final pronouncement of guilt by this
court. (G.R. No. 41200.) Probation implies guilt be final
judgment. While a probation case may look into the
circumstances attending the commission of the
offense, this does not authorize it to reverse the
findings and conclusive of this court, either directly or
indirectly, especially wherefrom its own admission
reliance was merely had on the printed briefs,
averments, and pleadings of the parties. As already
observed by this court in Shioji vs. Harvey ([1922], 43
Phil., 333, 337), and reiterated in subsequent cases, "if
each and every Court of First Instance could enjoy the
privilege of overruling decisions of the Supreme Court,
there would be no end to litigation, and judicial chaos
would result." A becoming modesty of inferior courts
demands conscious realization of the position that they
occupy in the interrelation and operation of the
intergrated judicial system of the nation.
After threshing carefully the multifarious issues raised
by both counsel for the petitioners and the
respondents, this court prefers to cut the Gordian knot
and take up at once the two fundamental questions
presented, namely, (1) whether or not the
constitutionality of Act No. 4221 has been properly
raised in these proceedings; and (2) in the affirmative,
whether or not said Act is constitutional.
Considerations of these issues will involve a discussion
of certain incidental questions raised by the parties.
238
To arrive at a correct conclusion on the first question,
resort to certain guiding principles is necessary. It is a
well-settled rule that the constitutionality of an act of the
legislature will not be determined by the courts unless
that question is properly raised and presented
inappropriate cases and is necessary to a
determination of the case; i.e., the issue of
constitutionality must be the very lis mota presented.
(McGirr vs. Hamilton and Abreu [1915], 30 Phil., 563,
568; 6 R. C. L., pp. 76, 77; 12 C. J., pp. 780-782, 783.)
The question of the constitutionality of an act of the
legislature is frequently raised in ordinary actions.
Nevertheless, resort may be made to extraordinary
legal remedies, particularly where the remedies in the
ordinary course of law even if available, are not plain,
speedy and adequate. Thus, in Cu Unjieng vs.
Patstone ([1922]), 42 Phil., 818), this court held that the
question of the constitutionality of a statute may be
raised by the petitioner in mandamus proceedings
(see, also, 12 C. J., p. 783); and in Government of the
Philippine Islands vs. Springer ([1927], 50 Phil., 259
[affirmed in Springer vs. Government of the Philippine
Islands (1928), 277 U. S., 189; 72 Law. ed., 845]), this
court declared an act of the legislature unconstitutional
in an action of quo warranto brought in the name of the
Government of the Philippines. It has also been held
that the constitutionality of a statute may be questioned
in habeas corpus proceedings (12 C. J., p. 783; Bailey
on Habeas Corpus, Vol. I, pp. 97, 117), although there
are authorities to the contrary; on an application for
injunction to restrain action under the challenged
statute (mandatory, see Cruz vs. Youngberg [1931], 56
Phil., 234); and even on an application for preliminary
injunction where the determination of the constitutional
question is necessary to a decision of the case. (12 C.
J., p. 783.) The same may be said as
regards prohibition and certiorari.(Yu Cong Eng vs.
Trinidad [1925], 47 Phil., 385; [1926], 271 U. S., 500;
70 Law. ed., 1059; Bell vs. First Judicial District Court
[1905], 28 Nev., 280; 81 Pac., 875; 113 A. S. R., 854;
6 Ann. Cas., 982; 1 L. R. A. [N. S], 843, and cases
cited). The case of Yu Cong Eng vs. Trinidad, supra,
decided by this court twelve years ago was, like the
present one, an original action for certiorari and
prohibition. The constitutionality of Act No. 2972,
popularly known as the Chinese Bookkeeping Law,
was there challenged by the petitioners, and the
constitutional issue was not met squarely by the
respondent in a demurrer. A point was raised "relating
to the propriety of the constitutional question being
decided in original proceedings in prohibition." This
court decided to take up the constitutional question
and, with two justices dissenting, held that Act No.
2972 was constitutional. The case was elevated on writ
of certiorari to the Supreme Court of the United States
which reversed the judgment of this court and held that
the Act was invalid. (271 U. S., 500; 70 Law. ed., 1059.)
On the question of jurisdiction, however, the Federal
Supreme Court, though its Chief Justice, said:
By the Code of Civil Procedure of the Philippine
Islands, section 516, the Philippine supreme court is
granted concurrent jurisdiction in prohibition with courts
of first instance over inferior tribunals or persons, and
original jurisdiction over courts of first instance, when
such courts are exercising functions without or in
excess of their jurisdiction. It has been held by that
court that the question of the validity of the criminal
statute must usually be raised by a defendant in the
trial court and be carried regularly in review to the
Supreme Court. (Cadwallader-Gibson Lumber Co. vs.
Del Rosario, 26 Phil., 192). But in this case where a
new act seriously affected numerous persons and
extensive property rights, and was likely to cause a
multiplicity of actions, the Supreme Court exercised its
discretion to bring the issue to the act's validity
promptly before it and decide in the interest of the
orderly administration of justice. The court relied by
analogy upon the cases of Ex parte Young (209 U. S.,
123;52 Law ed., 714; 13 L. R. A. [N. S.] 932; 28 Sup.
Ct. Rep., 441; 14 Ann. Ca., 764; Traux vs. Raich, 239
U. S., 33; 60 Law. ed., 131; L. R. A. 1916D, 545; 36
Sup. Ct. Rep., 7; Ann. Cas., 1917B, 283; and Wilson
vs. New, 243 U. S., 332; 61 Law. ed., 755; L. R. A.
1917E, 938; 37 Sup. Ct. Rep., 298; Ann. Cas. 1918A,
1024). Although objection to the jurisdiction was raise
by demurrer to the petition, this is now disclaimed on
behalf of the respondents, and both parties ask a
decision on the merits. In view of the broad powers in
prohibition granted to that court under the Island Code,
we acquiesce in the desire of the parties.
The writ of prohibition is an extraordinary judicial writ
issuing out of a court of superior jurisdiction and
directed to an inferior court, for the purpose of
preventing the inferior tribunal from usurping a
jurisdiction with which it is not legally vested. (High,
Extraordinary Legal Remedies, p. 705.) The general
rule, although there is a conflict in the cases, is that the
merit of prohibition will not lie whether the inferior court
has jurisdiction independent of the statute the
constitutionality of which is questioned, because in
such cases the interior court having jurisdiction may
itself determine the constitutionality of the statute, and
its decision may be subject to review, and
consequently the complainant in such cases ordinarily
has adequate remedy by appeal without resort to the
writ of prohibition. But where the inferior court or
tribunal derives its jurisdiction exclusively from an
unconstitutional statute, it may be prevented by the writ
of prohibition from enforcing that statute. (50 C. J.,
670; Ex parte Round tree [1874, 51 Ala., 42; In
re Macfarland, 30 App. [D. C.], 365; Curtis vs. Cornish
[1912], 109 Me., 384; 84 A., 799; Pennington vs.
Woolfolk [1880], 79 Ky., 13; State vs. Godfrey [1903],
54 W. Va., 54; 46 S. E., 185; Arnold vs. Shields [1837],
5 Dana, 19; 30 Am. Dec., 669.)
Courts of First Instance sitting in probation proceedings
derived their jurisdiction solely from Act No. 4221 which
prescribes in detailed manner the procedure for
granting probation to accused persons after their
conviction has become final and before they have
served their sentence. It is true that at common law the
authority of the courts to suspend temporarily the
execution of the sentence is recognized and, according
to a number of state courts, including those of
Massachusetts, Michigan, New York, and Ohio, the
power is inherent in the courts (Commonwealth vs.
Dowdican's Bail [1874], 115 Mass., 133; People vs.
Stickel [1909], 156 Mich., 557; 121 N. W., 497;
People ex rel. Forsyth vs. Court of Session [1894], 141
N. Y., 288; Weber vs. State [1898], 58 Ohio St., 616).
But, in the leading case of Ex parte United States
([1916], 242 U. S., 27; 61 Law. ed., 129; L. R. A.,
1917E, 1178; 37 Sup. Ct. Rep., 72; Ann. Cas. 1917B,
355), the Supreme Court of the United States
expressed the opinion that under the common law the
power of the court was limited to temporary
suspension, and brushed aside the contention as to
inherent judicial power saying, through Chief Justice
White:
Indisputably under our constitutional system the right
to try offenses against the criminal laws and upon
conviction to impose the punishment provided by law
is judicial, and it is equally to be conceded that, in
exerting the powers vested in them on such subject,
239
courts inherently possess ample right to exercise
reasonable, that is, judicial, discretion to enable them
to wisely exert their authority. But these concessions
afford no ground for the contention as to power here
made, since it must rest upon the proposition that the
power to enforce begets inherently a discretion to
permanently refuse to do so. And the effect of the
proposition urged upon the distribution of powers made
by the Constitution will become apparent when it is
observed that indisputable also is it that the authority
to define and fix the punishment for crime is legislative
and includes the right in advance to bring within judicial
discretion, for the purpose of executing the statute,
elements of consideration which would be otherwise
beyond the scope of judicial authority, and that the right
to relieve from the punishment, fixed by law and
ascertained according to the methods by it provided
belongs to the executive department.
Justice Carson, in his illuminating concurring opinion in
the case of Director of Prisons vs. Judge of First
Instance of Cavite (29 Phil., 265), decided by this court
in 1915, also reached the conclusion that the power to
suspend the execution of sentences pronounced in
criminal cases is not inherent in the judicial function.
"All are agreed", he said, "that in the absence of
statutory authority, it does not lie within the power of
the courts to grant such suspensions." (at p. 278.) Both
petitioner and respondents are correct, therefore, when
they argue that a Court of First Instance sitting in
probation proceedings is a court of limited jurisdiction.
Its jurisdiction in such proceedings is conferred
exclusively by Act No. 4221 of the Philippine
Legislature.
It is, of course, true that the constitutionality of a statute
will not be considered on application for prohibition
where the question has not been properly brought to
the attention of the court by objection of some kind (Hill
vs. Tarver [1901], 130 Ala., 592; 30 S., 499; State ex
rel. Kelly vs. Kirby [1914], 260 Mo., 120; 168 S. W.,
746). In the case at bar, it is unquestionable that the
constitutional issue has been squarely presented not
only before this court by the petitioners but also before
the trial court by the private prosecution. The
respondent, Hon. Jose O Vera, however, acting as
judge of the court below, declined to pass upon the
question on the ground that the private prosecutor, not
being a party whose rights are affected by the statute,
may not raise said question. The respondent judge
cited Cooley on Constitutional Limitations (Vol. I, p.
339; 12 C. J., sec. 177, pp. 760 and 762), and McGlue
vs. Essex County ([1916], 225 Mass., 59; 113 N. E.,
742, 743), as authority for the proposition that a court
will not consider any attack made on the
constitutionality of a statute by one who has no interest
in defeating it because his rights are not affected by its
operation. The respondent judge further stated that it
may not motu proprio take up the constitutional
question and, agreeing with Cooley that "the power to
declare a legislative enactment void is one which the
judge, conscious of the fallibility of the human
judgment, will shrink from exercising in any case where
he can conscientiously and with due regard to duty and
official oath decline the responsibility" (Constitutional
Limitations, 8th ed., Vol. I, p. 332), proceeded on the
assumption that Act No. 4221 is constitutional. While
therefore, the court a quo admits that the constitutional
question was raised before it, it refused to consider the
question solely because it was not raised by a proper
party. Respondents herein reiterates this view. The
argument is advanced that the private prosecution has
no personality to appear in the hearing of the
application for probation of defendant Mariano Cu
Unjieng in criminal case No. 42648 of the Court of First
Instance of Manila, and hence the issue of
constitutionality was not properly raised in the lower
court. Although, as a general rule, only those who are
parties to a suit may question the constitutionality of a
statute involved in a judicial decision, it has been held
that since the decree pronounced by a court without
jurisdiction is void, where the jurisdiction of the court
depends on the validity of the statute in question, the
issue of the constitutionality will be considered on its
being brought to the attention of the court by persons
interested in the effect to be given the statute.(12 C. J.,
sec. 184, p. 766.) And, even if we were to concede that
the issue was not properly raised in the court below by
the proper party, it does not follow that the issue may
not be here raised in an original action of certiorari and
prohibitions. It is true that, as a general rule, the
question of constitutionality must be raised at the
earliest opportunity, so that if not raised by the
pleadings, ordinarily it may not be raised at the trial,
and if not raised in the trial court, it will not considered
on appeal. (12 C. J., p. 786. See, also, Cadwallader-
Gibson Lumber Co. vs. Del Rosario, 26 Phil., 192, 193-
195.) But we must state that the general rule admits of
exceptions. Courts, in the exercise of sounds
discretion, may determine the time when a question
affecting the constitutionality of a statute should be
presented. (In re Woolsey [1884], 95 N. Y., 135, 144.)
Thus, in criminal cases, although there is a very sharp
conflict of authorities, it is said that the question may
be raised for the first time at any stage of the
proceedings, either in the trial court or on appeal. (12
C. J., p. 786.) Even in civil cases, it has been held that
it is the duty of a court to pass on the constitutional
question, though raised for the first time on appeal, if it
appears that a determination of the question is
necessary to a decision of the case. (McCabe's Adm'x
vs. Maysville & B. S. R. Co., [1910], 136 ky., 674; 124
S. W., 892; Lohmeyer vs. St. Louis Cordage Co.
[1908], 214 Mo., 685; 113 S. W. 1108; Carmody vs. St.
Louis Transit Co., [1905], 188 Mo., 572; 87 S. W., 913.)
And it has been held that a constitutional question will
be considered by an appellate court at any time, where
it involves the jurisdiction of the court below (State vs.
Burke [1911], 175 Ala., 561; 57 S., 870.) As to the
power of this court to consider the constitutional
question raised for the first time before this court in
these proceedings, we turn again and point with
emphasis to the case of Yu Cong Eng vs. Trinidad,
supra. And on the hypotheses that the Hongkong &
Shanghai Banking Corporation, represented by the
private prosecution, is not the proper party to raise the
constitutional question here — a point we do not now
have to decide — we are of the opinion that the People
of the Philippines, represented by the Solicitor-General
and the Fiscal of the City of Manila, is such a proper
party in the present proceedings. The unchallenged
rule is that the person who impugns the validity of a
statute must have a personal and substantial interest
in the case such that he has sustained, or will
sustained, direct injury as a result of its enforcement. It
goes without saying that if Act No. 4221 really violates
the constitution, the People of the Philippines, in whose
name the present action is brought, has a substantial
interest in having it set aside. Of grater import than the
damage caused by the illegal expenditure of public
funds is the mortal wound inflicted upon the
fundamental law by the enforcement of an invalid
statute. Hence, the well-settled rule that the state can
challenge the validity of its own laws. In Government of
the Philippine Islands vs. Springer ([1927]), 50 Phil.,
259 (affirmed in Springer vs. Government of the
Philippine Islands [1928], 277 U.S., 189; 72 Law. ed.,
845), this court declared an act of the legislature
240
unconstitutional in an action instituted in behalf of the
Government of the Philippines. In Attorney General vs.
Perkins ([1889], 73 Mich., 303, 311, 312; 41 N. W. 426,
428, 429), the State of Michigan, through its Attorney
General, instituted quo warranto proceedings to test
the right of the respondents to renew a mining
corporation, alleging that the statute under which the
respondents base their right was unconstitutional
because it impaired the obligation of contracts. The
capacity of the chief law officer of the state to question
the constitutionality of the statute was though, as a
general rule, only those who are parties to a suit may
question the constitutionality of a statute involved in a
judicial decision, it has been held that since the decree
pronounced by a court without jurisdiction in void,
where the jurisdiction of the court depends on the
validity of the statute in question, the issue of
constitutionality will be considered on its being brought
to the attention of the court by persons interested in the
effect to begin the statute. (12 C.J., sec. 184, p. 766.)
And, even if we were to concede that the issue was not
properly raised in the court below by the proper party,
it does not follow that the issue may not be here raised
in an original action of certiorari and prohibition. It is
true that, as a general rule, the question of
constitutionality must be raised at the earliest
opportunity, so that if not raised by the pleadings,
ordinarily it may not be raised a the trial, and if not
raised in the trial court, it will not be considered on
appeal. (12 C.J., p. 786. See, also, Cadwallader-
Gibson Lumber Co. vs. Del Rosario, 26 Phil., 192, 193-
195.) But we must state that the general rule admits of
exceptions. Courts, in the exercise of sound discretion,
may determine the time when a question affecting the
constitutionality of a statute should be presented. (In re
Woolsey [19884], 95 N.Y., 135, 144.) Thus, in criminal
cases, although there is a very sharp conflict of
authorities, it is said that the question may be raised for
the first time at any state of the proceedings, either in
the trial court or on appeal. (12 C.J., p. 786.) Even in
civil cases, it has been held that it is the duty of a court
to pass on the constitutional question, though raised for
first time on appeal, if it appears that a determination
of the question is necessary to a decision of the case.
(McCabe's Adm'x vs. Maysville & B. S. R. Co. [1910],
136 Ky., 674; 124 S. W., 892; Lohmeyer vs. St. Louis,
Cordage Co. [1908], 214 Mo. 685; 113 S. W., 1108;
Carmody vs. St. Louis Transit Co. [1905], 188 Mo.,
572; 87 S. W., 913.) And it has been held that a
constitutional question will be considered by an
appellate court at any time, where it involves the
jurisdiction of the court below (State vs. Burke [1911],
175 Ala., 561; 57 S., 870.) As to the power of this court
to consider the constitutional question raised for the
first time before this court in these proceedings, we turn
again and point with emphasis to the case of Yu Cong
Eng. vs. Trinidad, supra. And on the hypothesis that
the Hongkong & Shanghai Banking Corporation,
represented by the private prosecution, is not the
proper party to raise the constitutional question here —
a point we do not now have to decide — we are of the
opinion that the People of the Philippines, represented
by the Solicitor-General and the Fiscal of the City of
Manila, is such a proper party in the present
proceedings. The unchallenged rule is that the person
who impugns the validity of a statute must have a
personal and substantial interest in the case such that
he has sustained, or will sustain, direct injury as a result
of its enforcement. It goes without saying that if Act No.
4221 really violates the Constitution, the People of the
Philippines, in whose name the present action is
brought, has a substantial interest in having it set
aside. Of greater import than the damage caused by
the illegal expenditure of public funds is the mortal
wound inflicted upon the fundamental law by the
enforcement of an invalid statute. Hence, the well-
settled rule that the state can challenge the validity of
its own laws. In Government of the Philippine Islands
vs. Springer ([1927]), 50 Phil., 259 (affirmed in Springer
vs. Government of the Philippine Islands [1928], 277
U.S., 189; 72 Law. ed., 845), this court declared an act
of the legislature unconstitutional in an action instituted
in behalf of the Government of the Philippines. In
Attorney General vs. Perkings([1889], 73 Mich., 303,
311, 312; 41 N.W., 426, 428, 429), the State of
Michigan, through its Attorney General, instituted quo
warranto proceedings to test the right of the
respondents to renew a mining corporation, alleging
that the statute under which the respondents base their
right was unconstitutional because it impaired the
obligation of contracts. The capacity of the chief law
officer of the state to question the constitutionality of
the statute was itself questioned. Said the Supreme
Court of Michigan, through Champlin, J.:
. . . The idea seems to be that the people are estopped
from questioning the validity of a law enacted by their
representatives; that to an accusation by the people of
Michigan of usurpation their government, a statute
enacted by the people of Michigan is an adequate
answer. The last proposition is true, but, if the statute
relied on in justification is unconstitutional, it is statute
only in form, and lacks the force of law, and is of no
more saving effect to justify action under it than if it had
never been enacted. The constitution is the supreme
law, and to its behests the courts, the legislature, and
the people must bow . . . The legislature and the
respondents are not the only parties in interest upon
such constitutional questions. As was remarked by Mr.
Justice Story, in speaking of an acquiescence by a
party affected by an unconstitutional act of the
legislature: "The people have a deep and vested
interest in maintaining all the constitutional limitations
upon the exercise of legislative powers." (Allen vs.
Mckeen, 1 Sum., 314.)
In State vs. Doane ([1916], 98 Kan., 435; 158 Pac., 38,
40), an original action (mandamus) was brought by the
Attorney-General of Kansas to test the constitutionality
of a statute of the state. In disposing of the question
whether or not the state may bring the action, the
Supreme Court of Kansas said:
. . . the state is a proper party — indeed, the proper
party — to bring this action. The state is always
interested where the integrity of its Constitution or
statutes is involved.
"It has an interest in seeing that the will of the
Legislature is not disregarded, and need not, as an
individual plaintiff must, show grounds of fearing more
specific injury. (State vs. Kansas City 60 Kan., 518 [57
Pac., 118])." (State vs. Lawrence, 80 Kan., 707; 103
Pac., 839.)
Where the constitutionality of a statute is in doubt the
state's law officer, its Attorney-General, or county
attorney, may exercise his bet judgment as to what sort
of action he will bring to have the matter determined,
either by quo warranto to challenge its validity (State
vs. Johnson, 61 Kan., 803; 60 Pac., 1068; 49 L.R.A.,
662), by mandamus to compel obedience to its terms
(State vs. Dolley, 82 Kan., 533; 108 Pac., 846), or by
injunction to restrain proceedings under its
questionable provisions (State ex rel. vs. City of
Neodesha, 3 Kan. App., 319; 45 Pac., 122).
241
Other courts have reached the same conclusion (See
State vs. St. Louis S. W. Ry. Co. [1917], 197 S. W.,
1006; State vs. S.H. Kress & Co. [1934], 155 S., 823;
State vs. Walmsley [1935], 181 La., 597; 160 S., 91;
State vs. Board of County Comr's [1934], 39 Pac. [2d],
286; First Const. Co. of Brooklyn vs. State [1917], 211
N.Y., 295; 116 N.E., 1020; Bush vs. State {1918], 187
Ind., 339; 119 N.E., 417; State vs. Watkins [1933], 176
La., 837; 147 S., 8, 10, 11). In the case last cited, the
Supreme Court of Luisiana said:
It is contended by counsel for Herbert Watkins that a
district attorney, being charged with the duty of
enforcing the laws, has no right to plead that a law is
unconstitutional. In support of the argument three
decisions are cited, viz.: State ex rel. Hall, District
Attorney, vs. Judge of Tenth Judicial District (33 La.
Ann., 1222); State ex rel. Nicholls, Governor vs.
Shakespeare, Mayor of New Orleans (41 Ann., 156; 6
So., 592); and State ex rel., Banking Co., etc. vs.
Heard, Auditor (47 La. Ann., 1679; 18 So., 746; 47 L.
R. A., 512). These decisions do not forbid a district
attorney to plead that a statute is unconstitutional if he
finds if in conflict with one which it is his duty to enforce.
In State ex rel. Hall, District Attorney, vs. Judge, etc.,
the ruling was the judge should not, merely because he
believed a certain statute to be unconstitutional forbid
the district attorney to file a bill of information charging
a person with a violation of the statute. In other words,
a judge should not judicially declare a statute
unconstitutional until the question of constitutionality is
tendered for decision, and unless it must be decided in
order to determine the right of a party litigant. State ex
rel. Nicholls, Governor, etc., is authority for the
proposition merely that an officer on whom a statute
imposes the duty of enforcing its provisions cannot
avoid the duty upon the ground that he considers the
statute unconstitutional, and hence in enforcing the
statute he is immune from responsibility if the statute
be unconstitutional. State ex rel. Banking Co., etc., is
authority for the proposition merely that executive
officers, e.g., the state auditor and state treasurer,
should not decline to perform ministerial duties
imposed upon them by a statute, on the ground that
they believe the statute is unconstitutional.
It is the duty of a district attorney to enforce the criminal
laws of the state, and, above all, to support the
Constitution of the state. If, in the performance of his
duty he finds two statutes in conflict with each other, or
one which repeals another, and if, in his judgment, one
of the two statutes is unconstitutional, it is his duty to
enforce the other; and, in order to do so, he is
compelled to submit to the court, by way of a plea, that
one of the statutes is unconstitutional. If it were not so,
the power of the Legislature would be free from
constitutional limitations in the enactment of criminal
laws.
The respondents do not seem to doubt seriously the
correctness of the general proposition that the state
may impugn the validity of its laws. They have not cited
any authority running clearly in the opposite direction.
In fact, they appear to have proceeded on the
assumption that the rule as stated is sound but that it
has no application in the present case, nor may it be
invoked by the City Fiscal in behalf of the People of the
Philippines, one of the petitioners herein, the principal
reasons being that the validity before this court, that the
City Fiscal is estopped from attacking the validity of the
Act and, not authorized challenge the validity of the Act
in its application outside said city. (Additional
memorandum of respondents, October 23, 1937, pp.
8,. 10, 17 and 23.)
The mere fact that the Probation Act has been
repeatedly relied upon the past and all that time has
not been attacked as unconstitutional by the Fiscal of
Manila but, on the contrary, has been impliedly
regarded by him as constitutional, is no reason for
considering the People of the Philippines estopped
from nor assailing its validity. For courts will pass upon
a constitutional questions only when presented before
it in bona fide cases for determination, and the fact that
the question has not been raised before is not a valid
reason for refusing to allow it to be raised later. The
fiscal and all others are justified in relying upon the
statute and treating it as valid until it is held void by the
courts in proper cases.
It remains to consider whether the determination of the
constitutionality of Act No. 4221 is necessary to the
resolution of the instant case. For, ". . . while the court
will meet the question with firmness, where its decision
is indispensable, it is the part of wisdom, and just
respect for the legislature, renders it proper, to waive
it, if the case in which it arises, can be decided on other
points." (Ex parte Randolph [1833], 20 F. Cas. No. 11,
558; 2 Brock., 447. Vide, also Hoover vs. wood [1857],
9 Ind., 286, 287.) It has been held that the
determination of a constitutional question is necessary
whenever it is essential to the decision of the case (12
C. J., p. 782, citing Long Sault Dev. Co. vs. Kennedy
[1913], 158 App. Div., 398; 143 N. Y. Supp., 454 [aff.
212 N.Y., 1: 105 N. E., 849; Ann. Cas. 1915D, 56; and
app dism 242 U.S., 272]; Hesse vs. Ledesma, 7 Porto
Rico Fed., 520; Cowan vs. Doddridge, 22 Gratt [63
Va.], 458; Union Line Co., vs. Wisconsin R. Commn.,
146 Wis., 523; 129 N. W., 605), as where the right of a
party is founded solely on a statute the validity of which
is attacked. (12 C.J., p. 782, citing Central Glass Co.
vs. Niagrara F. Ins. Co., 131 La., 513; 59 S., 972;
Cheney vs. Beverly, 188 Mass., 81; 74 N.E., 306).
There is no doubt that the respondent Cu Unjieng
draws his privilege to probation solely from Act No.
4221 now being assailed.
Apart from the foregoing considerations, that court will
also take cognizance of the fact that the Probation Act
is a new addition to our statute books and its validity
has never before been passed upon by the courts; that
may persons accused and convicted of crime in the
City of Manila have applied for probation; that some of
them are already on probation; that more people will
likely take advantage of the Probation Act in the future;
and that the respondent Mariano Cu Unjieng has been
at large for a period of about four years since his first
conviction. All wait the decision of this court on the
constitutional question. Considering, therefore, the
importance which the instant case has assumed and to
prevent multiplicity of suits, strong reasons of public
policy demand that the constitutionality of Act No. 4221
be now resolved. (Yu Cong Eng vs. Trinidad [1925], 47
Phil., 385; [1926], 271 U.S., 500; 70 Law. ed., 1059.
See 6 R.C.L., pp. 77, 78; People vs. Kennedy [1913],
207 N.Y., 533; 101 N.E., 442, 444; Ann. Cas. 1914C,
616; Borginis vs. Falk Co. [1911], 147 Wis., 327; 133
N.W., 209, 211; 37 L.R.A. [N.S.] 489; Dimayuga and
Fajardo vs. Fernandez [1922], 43 Phil., 304.) In Yu
Cong Eng vs. Trinidad, supra, an analogous situation
confronted us. We said: "Inasmuch as the property and
personal rights of nearly twelve thousand merchants
are affected by these proceedings, and inasmuch as
Act No. 2972 is a new law not yet interpreted by the
courts, in the interest of the public welfare and for the
advancement of public policy, we have determined to
overrule the defense of want of jurisdiction in order that
we may decide the main issue. We have here an
extraordinary situation which calls for a relaxation of
242
the general rule." Our ruling on this point was sustained
by the Supreme Court of the United States. A more
binding authority in support of the view we have taken
can not be found.
We have reached the conclusion that the question of
the constitutionality of Act No. 4221 has been properly
raised. Now for the main inquiry: Is the Act
unconstitutional?
Under a doctrine peculiarly American, it is the office
and duty of the judiciary to enforce the Constitution.
This court, by clear implication from the provisions of
section 2, subsection 1, and section 10, of Article VIII
of the Constitution, may declare an act of the national
legislature invalid because in conflict with the
fundamental lay. It will not shirk from its sworn duty to
enforce the Constitution. And, in clear cases, it will not
hesitate to give effect to the supreme law by setting
aside a statute in conflict therewith. This is of the
essence of judicial duty.
This court is not unmindful of the fundamental criteria
in cases of this nature that all reasonable doubts
should be resolved in favor of the constitutionality of a
statute. An act of the legislature approved by the
executive, is presumed to be within constitutional
limitations. The responsibility of upholding the
Constitution rests not on the courts alone but on the
legislature as well. "The question of the validity of every
statute is first determined by the legislative department
of the government itself." (U.S. vs. Ten Yu [1912], 24
Phil., 1, 10; Case vs. Board of Health and Heiser
[1913], 24 Phil., 250, 276; U.S. vs. Joson [1913], 26
Phil., 1.) And a statute finally comes before the courts
sustained by the sanction of the executive. The
members of the Legislature and the Chief Executive
have taken an oath to support the Constitution and it
must be presumed that they have been true to this oath
and that in enacting and sanctioning a particular law
they did not intend to violate the Constitution. The
courts cannot but cautiously exercise its power to
overturn the solemn declarations of two of the three
grand departments of the governments. (6 R.C.L., p.
101.) Then, there is that peculiar political philosophy
which bids the judiciary to reflect the wisdom of the
people as expressed through an elective Legislature
and an elective Chief Executive. It follows, therefore,
that the courts will not set aside a law as violative of the
Constitution except in a clear case. This is a
proposition too plain to require a citation of authorities.
One of the counsel for respondents, in the course of
his impassioned argument, called attention to the fact
that the President of the Philippines had already
expressed his opinion against the constitutionality of
the Probation Act, adverting that as to the Executive
the resolution of this question was a foregone
conclusion. Counsel, however, reiterated his
confidence in the integrity and independence of this
court. We take notice of the fact that the President in
his message dated September 1, 1937, recommended
to the National Assembly the immediate repeal of the
Probation Act (No. 4221); that this message resulted in
the approval of Bill No. 2417 of the Nationality
Assembly repealing the probation Act, subject to
certain conditions therein mentioned; but that said bill
was vetoed by the President on September 13, 1937,
much against his wish, "to have stricken out from the
statute books of the Commonwealth a law . . . unfair
and very likely unconstitutional." It is sufficient to
observe in this connection that, in vetoing the bill
referred to, the President exercised his constitutional
prerogative. He may express the reasons which he
may deem proper for taking such a step, but his
reasons are not binding upon us in the determination
of actual controversies submitted for our determination.
Whether or not the Executive should express or in any
manner insinuate his opinion on a matter
encompassed within his broad constitutional power of
veto but which happens to be at the same time pending
determination in this court is a question of propriety for
him exclusively to decide or determine. Whatever
opinion is expressed by him under these
circumstances, however, cannot sway our judgment on
way or another and prevent us from taking what in our
opinion is the proper course of action to take in a given
case. It if is ever necessary for us to make any
vehement affirmance during this formative period of
our political history, it is that we are independent of the
Executive no less than of the Legislative department of
our government — independent in the performance of
our functions, undeterred by any consideration, free
from politics, indifferent to popularity, and unafraid of
criticism in the accomplishment of our sworn duty as
we see it and as we understand it.
The constitutionality of Act No. 4221 is challenged on
three principal grounds: (1) That said Act encroaches
upon the pardoning power of the Executive; (2) that its
constitutes an undue delegation of legislative power
and (3) that it denies the equal protection of the laws.
1. Section 21 of the Act of Congress of August 29,
1916, commonly known as the Jones Law, in force at
the time of the approval of Act No. 4221, otherwise
known as the Probation Act, vests in the Governor-
General of the Philippines "the exclusive power to grant
pardons and reprieves and remit fines and forfeitures".
This power is now vested in the President of the
Philippines. (Art. VII, sec. 11, subsec. 6.) The
provisions of the Jones Law and the Constitution differ
in some respects. The adjective "exclusive" found in
the Jones Law has been omitted from the Constitution.
Under the Jones Law, as at common law, pardon could
be granted any time after the commission of the
offense, either before or after conviction
(Vide Constitution of the United States, Art. II, sec. 2; In
re Lontok [1922], 43 Phil., 293). The Governor-General
of the Philippines was thus empowered, like the
President of the United States, to pardon a person
before the facts of the case were fully brought to light.
The framers of our Constitution thought this
undesirable and, following most of the state
constitutions, provided that the pardoning power can
only be exercised "after conviction". So, too, under the
new Constitution, the pardoning power does not extend
to "cases of impeachment". This is also the rule
generally followed in the United States
(Vide Constitution of the United States, Art. II, sec. 2).
The rule in England is different. There, a royal pardon
can not be pleaded in bar of an impeachment; "but,"
says Blackstone, "after the impeachment has been
solemnly heard and determined, it is not understood
that the king's royal grace is further restrained or
abridged." (Vide, Ex parte Wells [1856], 18 How., 307;
15 Law. ed., 421; Com. vs. Lockwood [1872], 109
Mass., 323; 12 Am. Rep., 699; Sterling vs. Drake
[1876], 29 Ohio St., 457; 23 am. Rep., 762.) The
reason for the distinction is obvious. In England,
Judgment on impeachment is not confined to mere
"removal from office and disqualification to hold and
enjoy any office of honor, trust, or profit under the
Government" (Art. IX, sec. 4, Constitution of the
Philippines) but extends to the whole punishment
attached by law to the offense committed. The House
of Lords, on a conviction may, by its sentence, inflict
capital punishment, perpetual banishment, perpetual
243
banishment, fine or imprisonment, depending upon the
gravity of the offense committed, together with removal
from office and incapacity to hold office. (Com. vs.
Lockwood, supra.) Our Constitution also makes
specific mention of "commutation" and of the power of
the executive to impose, in the pardons he may grant,
such conditions, restrictions and limitations as he may
deem proper. Amnesty may be granted by the
President under the Constitution but only with the
concurrence of the National Assembly. We need not
dwell at length on the significance of these
fundamental changes. It is sufficient for our purposes
to state that the pardoning power has remained
essentially the same. The question is: Has the
pardoning power of the Chief Executive under the
Jones Law been impaired by the Probation Act?
As already stated, the Jones Law vests the pardoning
power exclusively in the Chief Executive. The exercise
of the power may not, therefore, be vested in anyone
else.
". . . The benign prerogative of mercy reposed in the
executive cannot be taken away nor fettered by any
legislative restrictions, nor can like power be given by
the legislature to any other officer or authority. The
coordinate departments of government have nothing to
do with the pardoning power, since no person properly
belonging to one of the departments can exercise any
powers appertaining to either of the others except in
cases expressly provided for by the constitution." (20
R.C.L., pp., , and cases cited.) " . . . where the
pardoning power is conferred on the executive without
express or implied limitations, the grant is exclusive,
and the legislature can neither exercise such power
itself nor delegate it elsewhere, nor interfere with or
control the proper exercise thereof, . . ." (12 C.J., pp.
838, 839, and cases cited.) If Act No. 4221, then,
confers any pardoning power upon the courts it is for
that reason unconstitutional and void. But does it?
In the famous Killitts decision involving an
embezzlement case, the Supreme Court of the United
States ruled in 1916 that an order indefinitely
suspending sentenced was void. (Ex parte United
States [1916], 242 U.S., 27; 61 Law. ed., 129; L.R.A.
1917E, 1178; 37 Sup. Ct. Rep., 72; Ann. Cas. 1917B,
355.) Chief Justice White, after an exhaustive review of
the authorities, expressed the opinion of the court that
under the common law the power of the court was
limited to temporary suspension and that the right to
suspend sentenced absolutely and permanently was
vested in the executive branch of the government and
not in the judiciary. But, the right of Congress to
establish probation by statute was conceded. Said the
court through its Chief Justice: ". . . and so far as the
future is concerned, that is, the causing of the
imposition of penalties as fixed to be subject, by
probation legislation or such other means as the
legislative mind may devise, to such judicial discretion
as may be adequate to enable courts to meet by the
exercise of an enlarged but wise discretion the infinite
variations which may be presented to them for
judgment, recourse must be had Congress whose
legislative power on the subject is in the very nature of
things adequately complete." (Quoted in Riggs vs.
United States [1926], 14 F. [2d], 5, 6.) This decision led
the National Probation Association and others to
agitate for the enactment by Congress of a federal
probation law. Such action was finally taken on March
4, 1925 (chap. 521, 43 Stat. L. 159, U.S.C. title 18, sec.
724). This was followed by an appropriation to defray
the salaries and expenses of a certain number of
probation officers chosen by civil service. (Johnson,
Probation for Juveniles and Adults, p. 14.)
In United States vs. Murray ([1925], 275 U.S., 347; 48
Sup. Ct. Rep., 146; 72 Law. ed., 309), the Supreme
Court of the United States, through Chief Justice Taft,
held that when a person sentenced to imprisonment by
a district court has begun to serve his sentence, that
court has no power under the Probation Act of March
4, 1925 to grant him probation even though the term at
which sentence was imposed had not yet expired. In
this case of Murray, the constitutionality of the
probation Act was not considered but was assumed.
The court traced the history of the Act and quoted from
the report of the Committee on the Judiciary of the
United States House of Representatives (Report No.
1377, 68th Congress, 2 Session) the following
statement:
Prior to the so-called Killitts case, rendered in
December, 1916, the district courts exercised a form of
probation either, by suspending sentence or by placing
the defendants under state probation officers or
volunteers. In this case, however (Ex parte United
States, 242 U.S., 27; 61 L. Ed., 129; L.R.A., 1917E,
1178; 37 Sup. Ct. Rep., 72 Ann. Cas. 1917B, 355), the
Supreme Court denied the right of the district courts to
suspend sentenced. In the same opinion the court
pointed out the necessity for action by Congress if the
courts were to exercise probation powers in the future
...
Since this decision was rendered, two attempts have
been made to enact probation legislation. In 1917, a bill
was favorably reported by the Judiciary Committee and
passed the House. In 1920, the judiciary Committee
again favorably reported a probation bill to the House,
but it was never reached for definite action.
If this bill is enacted into law, it will bring the policy of
the Federal government with reference to its treatment
of those convicted of violations of its criminal laws in
harmony with that of the states of the Union. At the
present time every state has a probation law, and in all
but twelve states the law applies both to adult and
juvenile offenders. (see, also, Johnson, Probation for
Juveniles and Adults [1928], Chap. I.)
The constitutionality of the federal probation law has
been sustained by inferior federal courts. In Riggs vs.
United States supra, the Circuit Court of Appeals of the
Fourth Circuit said:
Since the passage of the Probation Act of March 4,
1925, the questions under consideration have been
reviewed by the Circuit Court of Appeals of the Ninth
Circuit (7 F. [2d], 590), and the constitutionality of the
act fully sustained, and the same held in no manner to
encroach upon the pardoning power of the President.
This case will be found to contain an able and
comprehensive review of the law applicable here. It
arose under the act we have to consider, and to it and
the authorities cited therein special reference is made
(Nix vs. James, 7 F. [2d], 590, 594), as is also to a
decision of the Circuit Court of Appeals of the Seventh
Circuit (Kriebel vs. U.S., 10 F. [2d], 762), likewise
construing the Probation Act.
We have seen that in 1916 the Supreme Court of the
United States; in plain and unequivocal language,
pointed to Congress as possessing the requisite power
to enact probation laws, that a federal probation law as
actually enacted in 1925, and that the constitutionality
of the Act has been assumed by the Supreme Court of
the United States in 1928 and consistently sustained
by the inferior federal courts in a number of earlier
cases.
244
We are fully convinced that the Philippine Legislature,
like the Congress of the United States, may legally
enact a probation law under its broad power to fix the
punishment of any and all penal offenses. This
conclusion is supported by other authorities. In Ex
parte Bates ([1915], 20 N. M., 542; L.R.A. 1916A,
1285; 151 Pac., 698, the court said: "It is clearly within
the province of the Legislature to denominate and
define all classes of crime, and to prescribe for each a
minimum and maximum punishment." And in State vs.
Abbott ([1910], 87 S.C., 466; 33 L.R.A. [N. S.], 112; 70
S. E., 6; Ann. Cas. 1912B, 1189), the court said: "The
legislative power to set punishment for crime is very
broad, and in the exercise of this power the general
assembly may confer on trial judges, if it sees fit, the
largest discretion as to the sentence to be imposed, as
to the beginning and end of the punishment and
whether it should be certain or indeterminate or
conditional." (Quoted in State vs. Teal [1918], 108 S.
C., 455; 95 S. E., 69.) Indeed, the Philippine
Legislature has defined all crimes and fixed the
penalties for their violation. Invariably, the legislature
has demonstrated the desire to vest in the courts —
particularly the trial courts — large discretion in
imposing the penalties which the law prescribes in
particular cases. It is believed that justice can best be
served by vesting this power in the courts, they being
in a position to best determine the penalties which an
individual convict, peculiarly circumstanced, should
suffer. Thus, while courts are not allowed to refrain
from imposing a sentence merely because, taking into
consideration the degree of malice and the injury
caused by the offense, the penalty provided by law is
clearly excessive, the courts being allowed in such
case to submit to the Chief Executive, through the
Department of Justice, such statement as it may deem
proper (see art. 5, Revised Penal Code), in cases
where both mitigating and aggravating circumstances
are attendant in the commission of a crime and the law
provides for a penalty composed of two indivisible
penalties, the courts may allow such circumstances to
offset one another in consideration of their number and
importance, and to apply the penalty according to the
result of such compensation. (Art. 63, rule 4, Revised
Penal Code; U.S. vs. Reguera and Asuategui [1921],
41 Phil., 506.) Again, article 64, paragraph 7, of the
Revised Penal Code empowers the courts to
determine, within the limits of each periods, in case the
penalty prescribed by law contains three periods, the
extent of the evil produced by the crime. In the
imposition of fines, the courts are allowed to fix any
amount within the limits established by law,
considering not only the mitigating and aggravating
circumstances, but more particularly the wealth or
means of the culprit. (Art. 66, Revised Penal Code.)
Article 68, paragraph 1, of the same Code provides that
"a discretionary penalty shall be imposed" upon a
person under fifteen but over nine years of age, who
has not acted without discernment, but always lower by
two degrees at least than that prescribed by law for the
crime which he has committed. Article 69 of the same
Code provides that in case of "incomplete self-
defense", i.e., when the crime committed is not wholly
excusable by reason of the lack of some of the
conditions required to justify the same or to exempt
from criminal liability in the several cases mentioned in
article 11 and 12 of the Code, "the courts shall impose
the penalty in the period which may be deemed proper,
in view of the number and nature of the conditions of
exemption present or lacking." And, in case the
commission of what are known as "impossible" crimes,
"the court, having in mind the social danger and the
degree of criminality shown by the offender," shall
impose upon him either arresto mayor or a fine ranging
from 200 to 500 pesos. (Art. 59, Revised Penal Code.)
Under our Revised Penal Code, also, one-half of the
period of preventive imprisonment is deducted form the
entire term of imprisonment, except in certain cases
expressly mentioned (art. 29); the death penalty is not
imposed when the guilty person is more than seventy
years of age, or where upon appeal or revision of the
case by the Supreme Court, all the members thereof
are not unanimous in their voting as to the propriety of
the imposition of the death penalty (art. 47, see also,
sec. 133, Revised Administrative Code, as amended
by Commonwealth Act No. 3); the death sentence is
not to be inflicted upon a woman within the three years
next following the date of the sentence or while she is
pregnant, or upon any person over seventy years of
age (art. 83); and when a convict shall become insane
or an imbecile after final sentence has been
pronounced, or while he is serving his sentenced, the
execution of said sentence shall be suspended with
regard to the personal penalty during the period of such
insanity or imbecility (art. 79).
But the desire of the legislature to relax what might
result in the undue harshness of the penal laws is more
clearly demonstrated in various other enactments,
including the probation Act. There is the Indeterminate
Sentence Law enacted in 1933 as Act No. 4103 and
subsequently amended by Act No. 4225, establishing
a system of parole (secs. 5 to 100 and granting the
courts large discretion in imposing the penalties of the
law. Section 1 of the law as amended provides;
"hereafter, in imposing a prison sentence for an
offenses punished by the Revised Penal Code, or its
amendments, the court shall sentence the accused to
an indeterminate sentence the maximum term of which
shall be that which, in view of the attending
circumstances, could be properly imposed under the
rules of the said Code, and to a minimum which shall
be within the range of the penalty next lower to that
prescribed by the Code for the offense; and if the
offense is punished by any other law, the court shall
sentence the accused to an indeterminate sentence,
the maximum term of which shall not exceed the
maximum fixed by said law and the minimum shall not
be less than the minimum term prescribed by the
same." Certain classes of convicts are, by section 2 of
the law, excluded from the operation thereof. The
Legislature has also enacted the Juvenile Delinquency
Law (Act No. 3203) which was subsequently amended
by Act No. 3559. Section 7 of the original Act and
section 1 of the amendatory Act have become article
80 of the Revised Penal Code, amended by Act No.
4117 of the Philippine Legislature and recently
reamended by Commonwealth Act No. 99 of the
National Assembly. In this Act is again manifested the
intention of the legislature to "humanize" the penal
laws. It allows, in effect, the modification in particular
cases of the penalties prescribed by law by permitting
the suspension of the execution of the judgment in the
discretion of the trial court, after due hearing and after
investigation of the particular circumstances of the
offenses, the criminal record, if any, of the convict, and
his social history. The Legislature has in reality
decreed that in certain cases no punishment at all shall
be suffered by the convict as long as the conditions of
probation are faithfully observed. It this be so, then, it
cannot be said that the Probation Act comes in conflict
with the power of the Chief Executive to grant pardons
and reprieves, because, to use the language of the
Supreme Court of New Mexico, "the element of
punishment or the penalty for the commission of a
wrong, while to be declared by the courts as a judicial
function under and within the limits of law as
245
announced by legislative acts, concerns solely the
procedure and conduct of criminal causes, with which
the executive can have nothing to do." (Ex
parteBates, supra.) In Williams vs. State ([1926], 162
Ga., 327; 133 S.E., 843), the court upheld the
constitutionality of the Georgia probation statute
against the contention that it attempted to delegate to
the courts the pardoning power lodged by the
constitution in the governor alone is vested with the
power to pardon after final sentence has been imposed
by the courts, the power of the courts to imposed any
penalty which may be from time to time prescribed by
law and in such manner as may be defined cannot be
questioned."
We realize, of course, the conflict which the American
cases disclose. Some cases hold it unlawful for the
legislature to vest in the courts the power to suspend
the operation of a sentenced, by probation or
otherwise, as to do so would encroach upon the
pardoning power of the executive. (In re Webb [1895],
89 Wis., 354; 27 L.R.A., 356; 46 Am. St. Rep., 846; 62
N.W., 177; 9 Am. Crim., Rep., 702; State ex rel.
Summerfield vs. Moran [1919], 43 Nev., 150; 182 Pac.,
927; Ex parte Clendenning [1908], 22 Okla., 108; 1
Okla. Crim. Rep., 227; 19 L.R.A. [N.S.], 1041; 132 Am.
St. Rep., 628; 97 Pac., 650; People vs. Barrett [1903],
202 Ill, 287; 67 N.E., 23; 63 L.R.A., 82; 95 Am. St. Rep.,
230; Snodgrass vs. State [1912], 67 Tex. Crim. Rep.,
615; 41 L. R. A. [N. S.], 1144; 150 S. W., 162; Ex
parte Shelor [1910], 33 Nev., 361;111 Pac., 291; Neal
vs. State [1898], 104 Ga., 509; 42 L. R. A., 190; 69 Am.
St. Rep., 175; 30 S. E. 858; State ex rel. Payne vs.
Anderson [1921], 43 S. D., 630; 181 N. W., 839; People
vs. Brown, 54 Mich., 15; 19 N. W., 571; States vs.
Dalton [1903], 109 Tenn., 544; 72 S. W., 456.)
Other cases, however, hold contra. (Nix vs. James
[1925; C. C. A., 9th], 7 F. [2d], 590; Archer vs. Snook
[1926; D. C.], 10 F. [2d], 567; Riggs. vs. United States
[1926; C. C. A. 4th], 14]) [2d], 5; Murphy vs. States
[1926], 171 Ark., 620; 286 S. W., 871; 48 A. L. R., 1189;
Re Giannini [1912], 18 Cal. App., 166; 122 Pac., 831;
Re Nachnaber [1928], 89 Cal. App., 530; 265 Pac.,
392; Ex parte De Voe [1931], 114 Cal. App., 730; 300
Pac., 874; People vs. Patrick [1897], 118 Cal., 332; 50
Pac., 425; Martin vs. People [1917], 69 Colo., 60; 168
Pac., 1171; Belden vs. Hugo [1914], 88 Conn., 50; 91
A., 369, 370, 371; Williams vs. State [1926], 162 Ga.,
327; 133 S. E., 843; People vs. Heise [1913], 257 Ill.,
443; 100 N. E., 1000; Parker vs. State [1893], 135 Ind.,
534; 35 N. E., 179; 23 L. R. A., 859; St. Hillarie,
Petitioner [1906], 101 Me., 522; 64 Atl., 882; People vs.
Stickle [1909], 156 Mich., 557; 121 N. W., 497; State
vs. Fjolander [1914], 125 Minn., 529; State ex rel.
Bottomnly vs. District Court [1925], 73 Mont., 541; 237
Pac., 525; State vs. Everitt [1913], 164 N. C., 399; 79
S. E., 274; 47 L. R. A. [N. S.], 848; State ex rel. Buckley
vs. Drew [1909], 75 N. H., 402; 74 Atl., 875; State vs.
Osborne [1911], 79 N. J. Eq., 430; 82 Atl. 424; Ex
parte Bates [1915], 20 N. M., 542; L. R. A., 1916 A.
1285; 151 Pac., 698; People vs. ex rel. Forsyth vs.
Court of Session [1894], 141 N. Y., 288; 23 L. R. A.,
856; 36 N. E., 386; 15 Am. Crim. Rep., 675; People ex
rel. Sullivan vs. Flynn [1907], 55 Misc., 639; 106 N. Y.
Supp., 928; People vs. Goodrich [1914], 149 N. Y.
Supp., 406; Moore vs. Thorn [1935], 245 App. Div.,
180; 281 N. Y. Supp., 49; Re Hart [1914], 29 N. D., 38;
L. R. A., 1915C, 1169; 149 N. W., 568; Ex parte Eaton
[1925], 29 Okla., Crim. Rep., 275; 233 P., 781; State
vs. Teal [1918], 108 S. C., 455; 95 S. E., 69; State vs.
Abbot [1910], 87 S. C., 466; 33 L.R.A., [N. S.], 112; 70
S. E., 6; Ann. Cas., 1912B, 1189; Fults vs. States
[1854],34 Tenn., 232; Woods vs. State [1814], 130
Tenn., 100; 169 S. W., 558; Baker vs. State [1814], 130
Tenn., 100; 169 S. W., 558; Baker vs. State [1913],70
Tex., Crim. Rep., 618; 158 S. W., 998; Cook vs. State
[1914], 73 Tex. Crim. Rep., 548; 165 S. W., 573; King
vs. State [1914], 72 Tex. Crim. Rep., 394; 162 S. W.,
890; Clare vs. State [1932], 122 Tex. Crim. Rep., 394;
162 S. W., 890; Clare vs. State [1932], 122 Tex. Crim.
Rep., 211; 54 S. W. [2d], 127; Re Hall [1927], 100 Vt.,
197; 136 A., 24; Richardson vs. Com. [1921], 131 Va.,
802; 109 S.E., 460; State vs. Mallahan [1911], 65
Wash., 287; 118 Pac., 42; State ex rel. Tingstand vs.
Starwich [1922], 119 Wash., 561; 206 Pac., 29; 26 A.
L. R., 393; 396.) We elect to follow this long catena of
authorities holding that the courts may be legally
authorized by the legislature to suspend sentence by
the establishment of a system of probation however
characterized. State ex rel. Tingstand vs. Starwich
([1922], 119 Wash., 561; 206 Pac., 29; 26 A. L. R.,
393), deserved particular mention. In that case, a
statute enacted in 1921 which provided for the
suspension of the execution of a sentence until
otherwise ordered by the court, and required that the
convicted person be placed under the charge of a
parole or peace officer during the term of such
suspension, on such terms as the court may
determine, was held constitutional and as not giving
the court a power in violation of the constitutional
provision vesting the pardoning power in the chief
executive of the state. (Vide, also, Re Giannini [1912],
18 Cal App., 166; 122 Pac., 831.)
Probation and pardon are not coterminous; nor are
they the same. They are actually district and different
from each other, both in origin and in nature. In
People ex rel. Forsyth vs. Court of Sessions ([1894],
141 N. Y., 288, 294; 36 N. E., 386, 388; 23 L. R. A.,
856; 15 Am. Crim. Rep., 675), the Court of Appeals of
New York said:
. . . The power to suspend sentence and the power to
grant reprieves and pardons, as understood when the
constitution was adopted, are totally distinct and
different in their nature. The former was always a part
of the judicial power; the latter was always a part of the
executive power. The suspension of the sentence
simply postpones the judgment of the court temporarily
or indefinitely, but the conviction and liability following
it, and the civil disabilities, remain and become
operative when judgment is rendered. A pardon
reaches both the punishment prescribed for the
offense and the guilt of the offender. It releases the
punishment, and blots out of existence the guilt, so that
in the eye of the law, the offender is as innocent as if
he had never committed the offense. It removes the
penalties and disabilities, and restores him to all his
civil rights. It makes him, as it were, a new man, and
gives him a new credit and capacity. (Ex parte Garland,
71 U. S., 4 Wall., 333; 18 Law. ed., 366; U. S. vs. Klein,
80 U. S., 13 Wall., 128; 20 Law. ed., 519; Knote vs. U.
S., 95 U. S., 149; 24 Law. ed., 442.)
The framers of the federal and the state constitutions
were perfectly familiar with the principles governing the
power to grant pardons, and it was conferred by these
instruments upon the executive with full knowledge of
the law upon the subject, and the words of the
constitution were used to express the authority
formerly exercised by the English crown, or by its
representatives in the colonies. (Ex parte Wells, 59 U.
S., 18 How., 307; 15 Law. ed., 421.) As this power was
understood, it did not comprehend any part of the
judicial functions to suspend sentence, and it was
never intended that the authority to grant reprieves and
pardons should abrogate, or in any degree restrict, the
exercise of that power in regard to its own judgments,
246
that criminal courts has so long maintained. The two
powers, so distinct and different in their nature and
character, were still left separate and distinct, the one
to be exercised by the executive, and the other by the
judicial department. We therefore conclude that a
statute which, in terms, authorizes courts of criminal
jurisdiction to suspend sentence in certain cases after
conviction, — a power inherent in such courts at
common law, which was understood when the
constitution was adopted to be an ordinary judicial
function, and which, ever since its adoption, has been
exercised of legislative power under the constitution. It
does not encroach, in any just sense, upon the powers
of the executive, as they have been understood and
practiced from the earliest times. (Quoted with
approval in Directors of Prisons vs. Judge of First
Instance of Cavite [1915], 29 Phil., 265, Carson, J.,
concurring, at pp. 294, 295.)
In probation, the probationer is in no true sense, as in
pardon, a free man. He is not finally and completely
exonerated. He is not exempt from the entire
punishment which the law inflicts. Under the Probation
Act, the probationer's case is not terminated by the
mere fact that he is placed on probation. Section 4 of
the Act provides that the probation may be definitely
terminated and the probationer finally discharged from
supervision only after the period of probation shall have
been terminated and the probation officer shall have
submitted a report, and the court shall have found that
the probationer has complied with the conditions of
probation. The probationer, then, during the period of
probation, remains in legal custody — subject to the
control of the probation officer and of the court; and, he
may be rearrested upon the non-fulfillment of the
conditions of probation and, when rearrested, may be
committed to prison to serve the sentence originally
imposed upon him. (Secs. 2, 3, 5 and 6, Act No. 4221.)
The probation described in the act is not pardon. It is
not complete liberty, and may be far from it. It is really
a new mode of punishment, to be applied by the judge
in a proper case, in substitution of the imprisonment
and find prescribed by the criminal laws. For this
reason its application is as purely a judicial act as any
other sentence carrying out the law deemed applicable
to the offense. The executive act of pardon, on the
contrary, is against the criminal law, which binds and
directs the judges, or rather is outside of and above it.
There is thus no conflict with the pardoning power, and
no possible unconstitutionality of the Probation Act for
this cause. (Archer vs. Snook [1926], 10 F. [2d], 567,
569.)
Probation should also be distinguished from reprieve
and from commutation of the sentence. Snodgrass vs.
State ([1912], 67 Tex. Crim. Rep., 615;41 L. R. A. [N.
S.], 1144; 150 S. W., 162), is relied upon most strongly
by the petitioners as authority in support of their
contention that the power to grant pardons and
reprieves, having been vested exclusively upon the
Chief Executive by the Jones Law, may not be
conferred by the legislature upon the courts by means
of probation law authorizing the indefinite judicial
suspension of sentence. We have examined that case
and found that although the Court of Criminal Appeals
of Texas held that the probation statute of the state in
terms conferred on the district courts the power to grant
pardons to persons convicted of crime, it also
distinguished between suspensions sentence on the
one hand, and reprieve and commutation of sentence
on the other. Said the court, through Harper, J.:
That the power to suspend the sentence does not
conflict with the power of the Governor to grant
reprieves is settled by the decisions of the various
courts; it being held that the distinction between a
"reprieve" and a suspension of sentence is that a
reprieve postpones the execution of the sentence to a
day certain, whereas a suspension is for an indefinite
time. (Carnal vs. People, 1 Parker, Cr. R., 262; In re
Buchanan, 146 N. Y., 264; 40 N. E., 883), and cases
cited in 7 Words & Phrases, pp. 6115, 6116. This law
cannot be hold in conflict with the power confiding in
the Governor to grant commutations of punishment, for
a commutations is not but to change the punishment
assessed to a less punishment.
In State ex rel. Bottomnly vs. District Court ([1925], 73
Mont., 541; 237 Pac., 525), the Supreme Court of
Montana had under consideration the validity of the
adult probation law of the state enacted in 1913, now
found in sections 12078-12086, Revised Codes of
1921. The court held the law valid as not impinging
upon the pardoning power of the executive. In a
unanimous decision penned by Justice Holloway, the
court said:
. . . . the term "pardon", "commutation", and "respite"
each had a well understood meaning at the time our
Constitution was adopted, and no one of them was
intended to comprehend the suspension of the
execution of the judgment as that phrase is employed
in sections 12078-12086. A "pardon" is an act of grace,
proceeding from the power intrusted with the execution
of the laws which exempts the individual on whom it is
bestowed from the punishment the law inflicts for a
crime he has committed (United States vs. Wilson, 7
Pet., 150; 8 Law. ed., 640); It is a remission of guilt
(State vs. Lewis, 111 La., 693; 35 So., 816), a
forgiveness of the offense (Cook vs. Middlesex County,
26 N. J. Law, 326; Ex parte Powell, 73 Ala., 517; 49
Am. Rep., 71). "Commutation" is a remission of a part
of the punishment; a substitution of a less penalty for
the one originally imposed (Lee vs. Murphy, 22 Grat.
[Va.] 789; 12 Am. Rep., 563; Rich vs. Chamberlain, 107
Mich., 381; 65 N. W., 235). A "reprieve" or "respite" is
the withholding of the sentence for an interval of time
(4 Blackstone's Commentaries, 394), a postponement
of execution (Carnal vs. People, 1 Parker, Cr. R. [N.
Y.], 272), a temporary suspension of execution (Butler
vs. State, 97 Ind., 373).
Few adjudicated cases are to be found in which the
validity of a statute similar to our section 12078 has
been determined; but the same objections have been
urged against parole statutes which vest the power to
parole in persons other than those to whom the power
of pardon is granted, and these statutes have been
upheld quite uniformly, as a reference to the numerous
cases cited in the notes to Woods vs. State (130 Tenn.,
100; 169 S. W.,558, reported in L. R. A., 1915F, 531),
will disclose. (See, also, 20 R. C. L., 524.)
We conclude that the Probation Act does not conflict
with the pardoning power of the Executive. The
pardoning power, in respect to those serving their
probationary sentences, remains as full and complete
as if the Probation Law had never been enacted. The
President may yet pardon the probationer and thus
place it beyond the power of the court to order his
rearrest and imprisonment. (Riggs vs. United States
[1926],
14 F. [2d], 5, 7.)
2. But while the Probation Law does not encroach upon
the pardoning power of the executive and is not for that
reason void, does section 11 thereof constitute, as
contended, an undue delegation of legislative power?
247
Under the constitutional system, the powers of
government are distributed among three coordinate
and substantially independent organs: the legislative,
the executive and the judicial. Each of these
departments of the government derives its authority
from the Constitution which, in turn, is the highest
expression of popular will. Each has exclusive
cognizance of the matters within its jurisdiction, and is
supreme within its own sphere.
The power to make laws — the legislative power — is
vested in a bicameral Legislature by the Jones Law
(sec. 12) and in a unicamiral National Assembly by the
Constitution (Act. VI, sec. 1, Constitution of the
Philippines). The Philippine Legislature or the National
Assembly may not escape its duties and
responsibilities by delegating that power to any other
body or authority. Any attempt to abdicate the power is
unconstitutional and void, on the principle that potestas
delegata non delegare potest. This principle is said to
have originated with the glossators, was introduced
into English law through a misreading of Bracton, there
developed as a principle of agency, was established by
Lord Coke in the English public law in decisions
forbidding the delegation of judicial power, and found
its way into America as an enlightened principle of free
government. It has since become an accepted
corollary of the principle of separation of powers. (5
Encyc. of the Social Sciences, p. 66.) The classic
statement of the rule is that of Locke, namely: "The
legislative neither must nor can transfer the power of
making laws to anybody else, or place it anywhere but
where the people have." (Locke on Civil Government,
sec. 142.) Judge Cooley enunciates the doctrine in the
following oft-quoted language: "One of the settled
maxims in constitutional law is, that the power
conferred upon the legislature to make laws cannot be
delegated by that department to any other body or
authority. Where the sovereign power of the state has
located the authority, there it must remain; and by the
constitutional agency alone the laws must be made
until the Constitution itself is charged. The power to
whose judgment, wisdom, and patriotism this high
prerogative has been intrusted cannot relieve itself of
the responsibilities by choosing other agencies upon
which the power shall be devolved, nor can it substitute
the judgment, wisdom, and patriotism of any other
body for those to which alone the people have seen fit
to confide this sovereign trust." (Cooley on
Constitutional Limitations, 8th ed., Vol. I, p. 224.
Quoted with approval in U. S. vs. Barrias [1908], 11
Phil., 327.) This court posits the doctrine "on the ethical
principle that such a delegated power constitutes not
only a right but a duty to be performed by the delegate
by the instrumentality of his own judgment acting
immediately upon the matter of legislation and not
through the intervening mind of another. (U. S. vs.
Barrias, supra, at p. 330.)
The rule, however, which forbids the delegation of
legislative power is not absolute and inflexible. It
admits of exceptions. An exceptions sanctioned by
immemorial practice permits the central legislative
body to delegate legislative powers to local authorities.
(Rubi vs. Provincial Board of Mindoro [1919], 39 Phil.,
660; U. S. vs. Salaveria [1918], 39 Phil., 102;
Stoutenburgh vs. Hennick [1889], 129 U. S., 141; 32
Law. ed., 637; 9 Sup. Ct. Rep., 256; State vs. Noyes
[1855], 30 N. H., 279.) "It is a cardinal principle of our
system of government, that local affairs shall be
managed by local authorities, and general affairs by
the central authorities; and hence while the rule is also
fundamental that the power to make laws cannot be
delegated, the creation of the municipalities exercising
local self government has never been held to trench
upon that rule. Such legislation is not regarded as a
transfer of general legislative power, but rather as the
grant of the authority to prescribed local regulations,
according to immemorial practice, subject of course to
the interposition of the superior in cases of necessity."
(Stoutenburgh vs. Hennick, supra.) On quite the same
principle, Congress is powered to delegate legislative
power to such agencies in the territories of the United
States as it may select. A territory stands in the same
relation to Congress as a municipality or city to the
state government. (United States vs. Heinszen [1907],
206 U. S., 370; 27 Sup. Ct. Rep., 742; 51 L. ed., 1098;
11 Ann. Cas., 688; Dorr vs. United States [1904], 195
U.S., 138; 24 Sup. Ct. Rep., 808; 49 Law. ed., 128; 1
Ann. Cas., 697.) Courts have also sustained the
delegation of legislative power to the people at large.
Some authorities maintain that this may not be done
(12 C. J., pp. 841, 842; 6 R. C. L., p. 164, citing People
vs. Kennedy [1913], 207 N. Y., 533; 101 N. E., 442;
Ann. Cas., 1914C, 616). However, the question of
whether or not a state has ceased to be republican in
form because of its adoption of the initiative and
referendum has been held not to be a judicial but a
political question (Pacific States Tel. & Tel. Co. vs.
Oregon [1912], 223 U. S., 118; 56 Law. ed., 377; 32
Sup. Cet. Rep., 224), and as the constitutionality of
such laws has been looked upon with favor by certain
progressive courts, the sting of the decisions of the
more conservative courts has been pretty well drawn.
(Opinions of the Justices [1894], 160 Mass., 586; 36 N.
E., 488; 23 L. R. A., 113; Kiernan vs. Portland [1910],
57 Ore., 454; 111 Pac., 379; 1132 Pac., 402; 37 L. R.
A. [N. S.], 332; Pacific States Tel. & Tel. Co. vs.
Oregon, supra.) Doubtless, also, legislative power may
be delegated by the Constitution itself. Section 14,
paragraph 2, of article VI of the Constitution of the
Philippines provides that "The National Assembly may
by law authorize the President, subject to such
limitations and restrictions as it may impose, to fix
within specified limits, tariff rates, import or export
quotas, and tonnage and wharfage dues." And section
16 of the same article of the Constitution provides that
"In times of war or other national emergency, the
National Assembly may by law authorize the President,
for a limited period and subject to such restrictions as
it may prescribed, to promulgate rules and regulations
to carry out a declared national policy." It is beyond the
scope of this decision to determine whether or not, in
the absence of the foregoing constitutional provisions,
the President could be authorized to exercise the
powers thereby vested in him. Upon the other hand,
whatever doubt may have existed has been removed
by the Constitution itself.
The case before us does not fall under any of the
exceptions hereinabove mentioned.
The challenged section of Act No. 4221 in section 11
which reads as follows:
This Act shall apply only in those provinces in which
the respective provincial boards have provided for the
salary of a probation officer at rates not lower than
those now provided for provincial fiscals. Said
probation officer shall be appointed by the Secretary of
Justice and shall be subject to the direction of the
Probation Office. (Emphasis ours.)
In testing whether a statute constitute an undue
delegation of legislative power or not, it is usual to
inquire whether the statute was complete in all its terms
and provisions when it left the hands of the legislature
so that nothing was left to the judgment of any other
248
appointee or delegate of the legislature. (6 R. C. L., p.
165.) In the United States vs. Ang Tang Ho ([1922], 43
Phil., 1), this court adhered to the foregoing rule when
it held an act of the legislature void in so far as it
undertook to authorize the Governor-General, in his
discretion, to issue a proclamation fixing the price of
rice and to make the sale of it in violation of the
proclamation a crime. (See and cf. Compañia General
de Tabacos vs. Board of Public Utility Commissioners
[1916], 34 Phil., 136.) The general rule, however, is
limited by another rule that to a certain extent matters
of detail may be left to be filled in by rules and
regulations to be adopted or promulgated by executive
officers and administrative boards. (6 R. C. L., pp. 177-
179.)
For the purpose of Probation Act, the provincial boards
may be regarded as administrative bodies endowed
with power to determine when the Act should take
effect in their respective provinces. They are the
agents or delegates of the legislature in this respect.
The rules governing delegation of legislative power to
administrative and executive officers are applicable or
are at least indicative of the rule which should be here
adopted. An examination of a variety of cases on
delegation of power to administrative bodies will show
that the ratio decidendi is at variance but, it can be
broadly asserted that the rationale revolves around the
presence or absence of a standard or rule of action —
or the sufficiency thereof — in the statute, to aid the
delegate in exercising the granted discretion. In some
cases, it is held that the standard is sufficient; in others
that is insufficient; and in still others that it is entirely
lacking. As a rule, an act of the legislature is incomplete
and hence invalid if it does not lay down any rule or
definite standard by which the administrative officer or
board may be guided in the exercise of the
discretionary powers delegated to it. (See Schecter vs.
United States [1925], 295 U. S., 495; 79 L. ed., 1570;
55 Sup. Ct. Rep., 837; 97 A.L.R., 947; People ex rel.
Rice vs. Wilson Oil Co. [1936], 364 Ill., 406; 4 N. E.
[2d], 847; 107 A.L.R., 1500 and cases cited. See also
R. C. L., title "Constitutional Law", sec 174.) In the case
at bar, what rules are to guide the provincial boards in
the exercise of their discretionary power to determine
whether or not the Probation Act shall apply in their
respective provinces? What standards are fixed by the
Act? We do not find any and none has been pointed to
us by the respondents. The probation Act does not, by
the force of any of its provisions, fix and impose upon
the provincial boards any standard or guide in the
exercise of their discretionary power. What is granted,
if we may use the language of Justice Cardozo in the
recent case of Schecter, supra, is a "roving
commission" which enables the provincial boards to
exercise arbitrary discretion. By section 11 if the Act,
the legislature does not seemingly on its own authority
extend the benefits of the Probation Act to the
provinces but in reality leaves the entire matter for the
various provincial boards to determine. In other words,
the provincial boards of the various provinces are to
determine for themselves, whether the Probation Law
shall apply to their provinces or not at all. The
applicability and application of the Probation Act are
entirely placed in the hands of the provincial boards. If
the provincial board does not wish to have the Act
applied in its province, all that it has to do is to decline
to appropriate the needed amount for the salary of a
probation officer. The plain language of the Act is not
susceptible of any other interpretation. This, to our
minds, is a virtual surrender of legislative power to the
provincial boards.
"The true distinction", says Judge Ranney, "is between
the delegation of power to make the law, which
necessarily involves a discretion as to what it shall be,
and conferring an authority or discretion as to its
execution, to be exercised under and in pursuance of
the law. The first cannot be done; to the latter no valid
objection can be made." (Cincinnati, W. & Z. R. Co. vs.
Clinton County Comrs. [1852]; 1 Ohio St., 77, 88. See
also, Sutherland on Statutory Construction, sec 68.) To
the same effect are the decision of this court
in Municipality of Cardona vs. Municipality of
Binangonan ([1917], 36 Phil., 547); Rubi vs. Provincial
Board of Mindoro ([1919],39 Phil., 660) and Cruz vs.
Youngberg ([1931], 56 Phil., 234). In the first of these
cases, this court sustained the validity of the law
conferring upon the Governor-General authority to
adjust provincial and municipal boundaries. In the
second case, this court held it lawful for the legislature
to direct non-Christian inhabitants to take up their
habitation on unoccupied lands to be selected by the
provincial governor and approved by the provincial
board. In the third case, it was held proper for the
legislature to vest in the Governor-General authority to
suspend or not, at his discretion, the prohibition of the
importation of the foreign cattle, such prohibition to be
raised "if the conditions of the country make this
advisable or if deceased among foreign cattle has
ceased to be a menace to the agriculture and livestock
of the lands."
It should be observed that in the case at bar we are not
concerned with the simple transference of details of
execution or the promulgation by executive or
administrative officials of rules and regulations to carry
into effect the provisions of a law. If we were,
recurrence to our own decisions would be sufficient.
(U. S. vs. Barrias [1908], 11 Phil., 327; U.S. vs. Molina
[1914], 29 Phil., 119; Alegre vs. Collector of Customs
[1929], 53 Phil., 394; Cebu Autobus Co. vs. De Jesus
[1931], 56 Phil., 446; U. S. vs. Gomez [1915], 31 Phil.,
218; Rubi vs. Provincial Board of Mindoro [1919], 39
Phil., 660.)
It is connected, however, that a legislative act may be
made to the effect as law after it leaves the hands of
the legislature. It is true that laws may be made
effective on certain contingencies, as by proclamation
of the executive or the adoption by the people of a
particular community (6 R. C. L., 116, 170-172; Cooley,
Constitutional Limitations, 8th ed., Vol. I, p. 227). In
Wayman vs. Southard ([1825], 10 Wheat. 1; 6 Law. ed.,
253), the Supreme Court of the United State ruled that
the legislature may delegate a power not legislative
which it may itself rightfully exercise.(Vide, also,
Dowling vs. Lancashire Ins. Co. [1896], 92 Wis., 63; 65
N. W., 738; 31 L. R. A., 112.) The power to ascertain
facts is such a power which may be delegated. There
is nothing essentially legislative in ascertaining the
existence of facts or conditions as the basis of the
taking into effect of a law. That is a mental process
common to all branches of the government. (Dowling
vs. Lancashire Ins. Co., supra; In re Village of North
Milwaukee [1896], 93 Wis., 616; 97 N.W., 1033; 33
L.R.A., 938; Nash vs. Fries [1906], 129 Wis., 120; 108
N.W., 210; Field vs. Clark [1892], 143 U.S., 649; 12
Sup. Ct., 495; 36 Law. ed., 294.) Notwithstanding the
apparent tendency, however, to relax the rule
prohibiting delegation of legislative authority on
account of the complexity arising from social and
economic forces at work in this modern industrial age
(Pfiffner, Public Administration [1936] ch. XX; Laski,
"The Mother of Parliaments", foreign Affairs, July,
1931, Vol. IX, No. 4, pp. 569-579; Beard, "Squirt-Gun
Politics", in Harper's Monthly Magazine, July, 1930,
Vol. CLXI, pp. 147, 152), the orthodox pronouncement
249
of Judge Cooley in his work on Constitutional
Limitations finds restatement in Prof. Willoughby's
treatise on the Constitution of the United States in the
following language — speaking of declaration of
legislative power to administrative agencies: "The
principle which permits the legislature to provide that
the administrative agent may determine when the
circumstances are such as require the application of a
law is defended upon the ground that at the time this
authority is granted, the rule of public policy, which is
the essence of the legislative act, is determined by the
legislature. In other words, the legislature, as it its duty
to do, determines that, under given circumstances,
certain executive or administrative action is to be
taken, and that, under other circumstances, different of
no action at all is to be taken. What is thus left to the
administrative official is not the legislative
determination of what public policy demands, but
simply the ascertainment of what the facts of the case
require to be done according to the terms of the law by
which he is governed." (Willoughby on the Constitution
of the United States, 2nd ed., Vol. II, p. 1637.) In Miller
vs. Mayer, etc., of New York [1883], 109 U.S., 3 Sup.
Ct. Rep., 228; 27 Law. ed., 971, 974), it was said: "The
efficiency of an Act as a declaration of legislative will
must, of course, come from Congress, but the
ascertainment of the contingency upon which the Act
shall take effect may be left to such agencies as it may
designate." (See, also, 12 C.J., p. 864; State vs. Parker
[1854], 26 Vt., 357; Blanding vs. Burr [1859], 13 Cal.,
343, 258.) The legislature, then may provide that a
contingencies leaving to some other person or body
the power to determine when the specified
contingencies has arisen. But, in the case at bar, the
legislature has not made the operation of the
Prohibition Act contingent upon specified facts or
conditions to be ascertained by the provincial board. It
leaves, as we have already said, the entire operation
or non-operation of the law upon the provincial board.
the discretion vested is arbitrary because it is absolute
and unlimited. A provincial board need not investigate
conditions or find any fact, or await the happening of
any specified contingency. It is bound by no rule, —
limited by no principle of expendiency announced by
the legislature. It may take into consideration certain
facts or conditions; and, again, it may not. It may have
any purpose or no purpose at all. It need not give any
reason whatsoever for refusing or failing to appropriate
any funds for the salary of a probation officer. This is a
matter which rest entirely at its pleasure. The fact that
at some future time — we cannot say when — the
provincial boards may appropriate funds for the
salaries of probation officers and thus put the law into
operation in the various provinces will not save the
statute. The time of its taking into effect, we reiterate,
would yet be based solely upon the will of the provincial
boards and not upon the happening of a certain
specified contingency, or upon the ascertainment of
certain facts or conditions by a person or body other
than legislature itself.
The various provincial boards are, in practical effect,
endowed with the power of suspending the operation
of the Probation Law in their respective provinces. In
some jurisdiction, constitutions provided that laws may
be suspended only by the legislature or by its authority.
Thus, section 28, article I of the Constitution of Texas
provides that "No power of suspending laws in this
state shall be exercised except by the legislature"; and
section 26, article I of the Constitution of Indiana
provides "That the operation of the laws shall never be
suspended, except by authority of the General
Assembly." Yet, even provisions of this sort do not
confer absolute power of suspension upon the
legislature. While it may be undoubted that the
legislature may suspend a law, or the execution or
operation of a law, a law may not be suspended as to
certain individuals only, leaving the law to be enjoyed
by others. The suspension must be general, and
cannot be made for individual cases or for particular
localities. In Holden vs. James ([1814], 11 Mass., 396;
6 Am. Dec., 174, 177, 178), it was said:
By the twentieth article of the declaration of rights in the
constitution of this commonwealth, it is declared that
the power of suspending the laws, or the execution of
the laws, ought never to be exercised but by the
legislature, or by authority derived from it, to be
exercised in such particular cases only as the
legislature shall expressly provide for. Many of the
articles in that declaration of rights were adopted from
the Magna Charta of England, and from the bill of rights
passed in the reign of William and Mary. The bill of
rights contains an enumeration of the oppressive acts
of James II, tending to subvert and extirpate the
protestant religion, and the laws and liberties of the
kingdom; and the first of them is the assuming and
exercising a power of dispensing with and suspending
the laws, and the execution of the laws without consent
of parliament. The first article in the claim or declaration
of rights contained in the statute is, that the exercise of
such power, by legal authority without consent of
parliament, is illegal. In the tenth section of the same
statute it is further declared and enacted, that "No
dispensation by non obstante of or to any statute, or
part thereof, should be allowed; but the same should
be held void and of no effect, except a dispensation be
allowed of in such statute." There is an implied
reservation of authority in the parliament to exercise
the power here mentioned; because, according to the
theory of the English Constitution, "that absolute
despotic power, which must in all governments reside
somewhere," is intrusted to the parliament: 1 Bl. Com.,
160.
The principles of our government are widely different in
this particular. Here the sovereign and absolute power
resides in the people; and the legislature can only
exercise what is delegated to them according to the
constitution. It is obvious that the exercise of the power
in question would be equally oppressive to the subject,
and subversive of his right to protection, "according to
standing laws," whether exercised by one man or by a
number of men. It cannot be supposed that the people
when adopting this general principle from the English
bill of rights and inserting it in our constitution, intended
to bestow by implication on the general court one of the
most odious and oppressive prerogatives of the
ancient kings of England. It is manifestly contrary to the
first principles of civil liberty and natural justice, and to
the spirit of our constitution and laws, that any one
citizen should enjoy privileges and advantages which
are denied to all others under like circumstances; or
that ant one should be subject to losses, damages,
suits, or actions from which all others under like
circumstances are exempted.
To illustrate the principle: A section of a statute relative
to dogs made the owner of any dog liable to the owner
of domestic animals wounded by it for the damages
without proving a knowledge of it vicious disposition.
By a provision of the act, power was given to the board
of supervisors to determine whether or not during the
current year their county should be governed by the
provisions of the act of which that section constituted a
part. It was held that the legislature could not confer
that power. The court observed that it could no more
confer such a power than to authorize the board of
supervisors of a county to abolish in such county the
250
days of grace on commercial paper, or to suspend the
statute of limitations. (Slinger vs. Henneman [1875], 38
Wis., 504.) A similar statute in Missouri was held void
for the same reason in State vs. Field ([1853, 17 Mo.,
529;59 Am. Dec., 275.) In that case a general statute
formulating a road system contained a provision that "if
the county court of any county should be of opinion that
the provisions of the act should not be enforced, they
might, in their discretion, suspend the operation of the
same for any specified length of time, and thereupon
the act should become inoperative in such county for
the period specified in such order; and thereupon order
the roads to be opened and kept in good repair, under
the laws theretofore in force." Said the court: ". . . this
act, by its own provisions, repeals the inconsistent
provisions of a former act, and yet it is left to the county
court to say which act shall be enforce in their county.
The act does not submit the question to the county
court as an original question, to be decided by that
tribunal, whether the act shall commence its operation
within the county; but it became by its own terms a law
in every county not excepted by name in the act. It did
not, then, require the county court to do any act in order
to give it effect. But being the law in the county, and
having by its provisions superseded and abrogated the
inconsistent provisions of previous laws, the county
court is . . . empowered, to suspend this act and revive
the repealed provisions of the former act. When the
question is before the county court for that tribunal to
determine which law shall be in force, it is urge before
us that the power then to be exercised by the court is
strictly legislative power, which under our constitution,
cannot be delegated to that tribunal or to any other
body of men in the state. In the present case, the
question is not presented in the abstract; for the county
court of Saline county, after the act had been for
several months in force in that county, did by order
suspend its operation; and during that suspension the
offense was committed which is the subject of the
present indictment . . . ." (See Mitchell vs. State [1901],
134 Ala., 392; 32 S., 687.)
True, the legislature may enact laws for a particular
locality different from those applicable to other
localities and, while recognizing the force of the
principle hereinabove expressed, courts in may
jurisdiction have sustained the constitutionality of the
submission of option laws to the vote of the people. (6
R.C.L., p. 171.) But option laws thus sustained treat of
subjects purely local in character which should receive
different treatment in different localities placed under
different circumstances. "They relate to subjects which,
like the retailing of intoxicating drinks, or the running at
large of cattle in the highways, may be differently
regarded in different localities, and they are sustained
on what seems to us the impregnable ground, that the
subject, though not embraced within the ordinary
powers of municipalities to make by-laws and
ordinances, is nevertheless within the class of public
regulations, in respect to which it is proper that the local
judgment should control." (Cooley on Constitutional
Limitations, 5th ed., p. 148.) So that, while we do not
deny the right of local self-government and the
propriety of leaving matters of purely local concern in
the hands of local authorities or for the people of small
communities to pass upon, we believe that in matters
of general of general legislation like that which treats of
criminals in general, and as regards the general
subject of probation, discretion may not be vested in a
manner so unqualified and absolute as provided in Act
No. 4221. True, the statute does not expressly state
that the provincial boards may suspend the operation
of the Probation Act in particular provinces but,
considering that, in being vested with the authority to
appropriate or not the necessary funds for the salaries
of probation officers, they thereby are given absolute
discretion to determine whether or not the law should
take effect or operate in their respective provinces, the
provincial boards are in reality empowered by the
legislature to suspend the operation of the Probation
Act in particular provinces, the Act to be held in
abeyance until the provincial boards should decide
otherwise by appropriating the necessary funds. The
validity of a law is not tested by what has been done
but by what may be done under its provisions. (Walter
E. Olsen & Co. vs. Aldanese and Trinidad [1922], 43
Phil., 259; 12 C. J., p. 786.)
It in conceded that a great deal of latitude should be
granted to the legislature not only in the expression of
what may be termed legislative policy but in the
elaboration and execution thereof. "Without this power,
legislation would become oppressive and yet
imbecile." (People vs. Reynolds, 5 Gilman, 1.) It has
been said that popular government lives because of
the inexhaustible reservoir of power behind it. It is
unquestionable that the mass of powers of government
is vested in the representatives of the people and that
these representatives are no further restrained under
our system than by the express language of the
instrument imposing the restraint, or by particular
provisions which by clear intendment, have that effect.
(Angara vs. Electoral Commission [1936], 35 Off. Ga.,
23; Schneckenburger vs. Moran [1936], 35 Off. Gaz.,
1317.) But, it should be borne in mind that a
constitution is both a grant and a limitation of power
and one of these time-honored limitations is that,
subject to certain exceptions, legislative power shall
not be delegated.
We conclude that section 11 of Act No. 4221
constitutes an improper and unlawful delegation of
legislative authority to the provincial boards and is, for
this reason, unconstitutional and void.
3. It is also contended that the Probation Act violates
the provisions of our Bill of Rights which prohibits the
denial to any person of the equal protection of the
laws (Act. III, sec. 1 subsec. 1. Constitution of the
Philippines.)
This basic individual right sheltered by the Constitution
is a restraint on all the tree grand departments of our
government and on the subordinate instrumentalities
and subdivision thereof, and on many constitutional
power, like the police power, taxation and eminent
domain. The equal protection of laws, sententiously
observes the Supreme Court of the United States, "is
a pledge of the protection of equal laws." (Yick Wo vs.
Hopkins [1886], 118 U. S., 356; 30 Law. ed., 220; 6
Sup. Ct. Rep., 10464; Perley vs. North Carolina, 249
U. S., 510; 39 Sup. Ct. Rep., 357; 63 Law. ed., 735.)
Of course, what may be regarded as a denial of the
equal protection of the laws in a question not always
easily determined. No rule that will cover every case
can be formulated. (Connolly vs. Union Sewer Pipe Co.
[1902], 184, U. S., 540; 22 Sup. Ct., Rep., 431; 46 Law.
ed., 679.) Class legislation discriminating against some
and favoring others in prohibited. But classification on
a reasonable basis, and nor made arbitrarily or
capriciously, is permitted. (Finely vs. California [1911],
222 U. S., 28; 56 Law. ed., 75; 32 Sup. Ct. Rep., 13;
Gulf. C. & S. F. Ry Co. vs. Ellis [1897], 165 U. S., 150;
41 Law. ed., 666; 17 Sup. Ct. Rep., 255; Smith, Bell &
Co. vs. Natividad [1919], 40 Phil., 136.) The
classification, however, to be reasonable must be
based on substantial distinctions which make real
differences; it must be germane to the purposes of the
251
law; it must not be limited to existing conditions only,
and must apply equally to each member of the class.
(Borgnis vs. Falk. Co. [1911], 147 Wis., 327, 353; 133
N. W., 209; 3 N. C. C. A., 649; 37 L. R. A. [N. S.], 489;
State vs. Cooley, 56 Minn., 540; 530-552; 58 N. W.,
150; Lindsley vs. Natural Carbonic Gas Co.[1911], 220
U. S., 61, 79, 55 Law. ed., 369, 377; 31 Sup. Ct. Rep.,
337; Ann. Cas., 1912C, 160; Lake Shore & M. S. R.
Co. vs. Clough [1917], 242 U.S., 375; 37 Sup. Ct. Rep.,
144; 61 Law. ed., 374; Southern Ry. Co. vs. Greene
[1910], 216 U. S., 400; 30 Sup. Ct. Rep., 287; 54 Law.
ed., 536; 17 Ann. Cas., 1247; Truax vs. Corrigan
[1921], 257 U. S., 312; 12 C. J., pp. 1148, 1149.)
In the case at bar, however, the resultant inequality
may be said to flow from the unwarranted delegation of
legislative power, although perhaps this is not
necessarily the result in every case. Adopting the
example given by one of the counsel for the petitioners
in the course of his oral argument, one province may
appropriate the necessary fund to defray the salary of
a probation officer, while another province may refuse
or fail to do so. In such a case, the Probation Act would
be in operation in the former province but not in the
latter. This means that a person otherwise coming
within the purview of the law would be liable to enjoy
the benefits of probation in one province while another
person similarly situated in another province would be
denied those same benefits. This is obnoxious
discrimination. Contrariwise, it is also possible for all
the provincial boards to appropriate the necessary
funds for the salaries of the probation officers in their
respective provinces, in which case no inequality would
result for the obvious reason that probation would be in
operation in each and every province by the affirmative
action of appropriation by all the provincial boards. On
that hypothesis, every person coming within the
purview of the Probation Act would be entitled to avail
of the benefits of the Act. Neither will there be any
resulting inequality if no province, through its provincial
board, should appropriate any amount for the salary of
the probation officer — which is the situation now —
and, also, if we accept the contention that, for the
purpose of the Probation Act, the City of Manila should
be considered as a province and that the municipal
board of said city has not made any appropriation for
the salary of the probation officer. These different
situations suggested show, indeed, that while
inequality may result in the application of the law and
in the conferment of the benefits therein provided,
inequality is not in all cases the necessary result. But
whatever may be the case, it is clear that in section 11
of the Probation Act creates a situation in which
discrimination and inequality are permitted or allowed.
There are, to be sure, abundant authorities requiring
actual denial of the equal protection of the law before
court should assume the task of setting aside a law
vulnerable on that score, but premises and
circumstances considered, we are of the opinion that
section 11 of Act No. 4221 permits of the denial of the
equal protection of the law and is on that account bad.
We see no difference between a law which permits of
such denial. A law may appear to be fair on its face and
impartial in appearance, yet, if it permits of unjust and
illegal discrimination, it is within the constitutional
prohibitions. (By analogy, Chy Lung vs. Freeman
[1876], 292 U. S., 275; 23 Law. ed., 550; Henderson
vs. Mayor [1876], 92 U. S., 259; 23 Law. ed., 543; Ex
parte Virginia [1880], 100 U. S., 339; 25 Law. ed., 676;
Neal vs. Delaware [1881], 103 U. S., 370; 26 Law. ed.,
567; Soon Hing vs. Crowley [1885], 113 U. S., 703; 28
Law. ed., 1145, Yick Wo vs. Hopkins [1886],118 U. S.,
356; 30 Law. ed., 220; Williams vs. Mississippi [1897],
170 U. S., 218; 18 Sup. Ct. Rep., 583; 42 Law. ed.,
1012; Bailey vs. Alabama [1911], 219 U. S., 219; 31
Sup. Ct. Rep. 145; 55 Law. ed., Sunday Lake Iron Co.
vs. Wakefield [1918], 247 U. S., 450; 38 Sup. Ct. Rep.,
495; 62 Law. ed., 1154.) In other words, statutes may
be adjudged unconstitutional because of their effect in
operation (General Oil Co. vs. Clain [1907], 209 U. S.,
211; 28 Sup. Ct. Rep., 475; 52 Law. ed., 754; State vs.
Clement Nat. Bank [1911], 84 Vt., 167; 78 Atl., 944;
Ann. Cas., 1912D, 22). If the law has the effect of
denying the equal protection of the law it is
unconstitutional. (6 R. C. L. p. 372; Civil Rights Cases,
109 U. S., 3; 3 Sup. Ct. Rep., 18; 27 Law. ed., 835; Yick
Wo vs. Hopkins, supra; State vs. Montgomery, 94 Me.,
192; 47 Atl., 165; 80 A. S. R., 386; State vs. Dering, 84
Wis., 585; 54 N. W., 1104; 36 A. S. R., 948; 19 L. R.
A., 858.) Under section 11 of the Probation Act, not
only may said Act be in force in one or several
provinces and not be in force in other provinces, but
one province may appropriate for the salary of the
probation officer of a given year — and have probation
during that year — and thereafter decline to make
further appropriation, and have no probation is
subsequent years. While this situation goes rather to
the abuse of discretion which delegation implies, it is
here indicated to show that the Probation Act sanctions
a situation which is intolerable in a government of laws,
and to prove how easy it is, under the Act, to make the
guaranty of the equality clause but "a rope of sand".
(Brewer, J. Gulf C. & S. F. Ry. Co. vs. Ellis [1897], 165
U. S., 150 154; 41 Law. ed., 666; 17 Sup. Ct. Rep.,
255.)lawph!1.net
Great reliance is placed by counsel for the respondents
on the case of Ocampo vs. United States ([1914], 234
U. S., 91; 58 Law. ed., 1231). In that case, the Supreme
Court of the United States affirmed the decision of this
court (18 Phil., 1) by declining to uphold the contention
that there was a denial of the equal protection of the
laws because, as held in Missouri vs. Lewis (Bowman
vs. Lewis) decided in 1880 (101 U. S., 220; 25 Law.
ed., 991), the guaranty of the equality clause does not
require territorial uniformity. It should be observed,
however, that this case concerns the right to
preliminary investigations in criminal cases originally
granted by General Orders No. 58. No question of
legislative authority was involved and the alleged
denial of the equal protection of the laws was the result
of the subsequent enactment of Act No. 612, amending
the charter of the City of Manila (Act No. 813) and
providing in section 2 thereof that "in cases triable only
in the court of first instance of the City of Manila, the
defendant . . . shall not be entitled as of right to a
preliminary examination in any case where the
prosecuting attorney, after a due investigation of the
facts . . . shall have presented an information against
him in proper form . . . ." Upon the other hand, an
analysis of the arguments and the decision indicates
that the investigation by the prosecuting attorney —
although not in the form had in the provinces — was
considered a reasonable substitute for the City of
Manila, considering the peculiar conditions of the city
as found and taken into account by the legislature
itself.
Reliance is also placed on the case of Missouri vs.
Lewis, supra. That case has reference to a situation
where the constitution of Missouri permits appeals to
the Supreme Court of the state from final judgments of
any circuit court, except those in certain counties for
which counties the constitution establishes a separate
court of appeals called St. Louis Court of Appeals. The
provision complained of, then, is found in the
constitution itself and it is the constitution that makes
the apportionment of territorial jurisdiction.
252
We are of the opinion that section 11 of the Probation
Act is unconstitutional and void because it is also
repugnant to equal-protection clause of our
Constitution.
Section 11 of the Probation Act being unconstitutional
and void for the reasons already stated, the next
inquiry is whether or not the entire Act should be
avoided.
In seeking the legislative intent, the presumption is
against any mutilation of a statute, and the courts will
resort to elimination only where an unconstitutional
provision is interjected into a statute otherwise valid,
and is so independent and separable that its removal
will leave the constitutional features and purposes of
the act substantially unaffected by the process. (Riccio
vs. Hoboken, 69 N. J. Law., 649, 662; 63 L. R. A., 485;
55 Atl., 1109, quoted in Williams vs. Standard Oil Co.
[1929], 278 U.S., 235, 240; 73 Law. ed., 287, 309; 49
Sup. Ct. Rep., 115; 60 A. L. R., 596.) In Barrameda vs.
Moir ([1913], 25 Phil., 44, 47), this court stated the well-
established rule concerning partial invalidity of statutes
in the following language:
. . . where part of the a statute is void, as repugnant to
the Organic Law, while another part is valid, the valid
portion, if separable from the valid, may stand and be
enforced. But in order to do this, the valid portion must
be in so far independent of the invalid portion that it is
fair to presume that the Legislative would have enacted
it by itself if they had supposed that they could not
constitutionally enact the other. (Mutual Loan Co. vs.
Martell, 200 Mass., 482; 86 N. E., 916; 128 A. S. R.,
446; Supervisors of Holmes Co. vs. Black Creek
Drainage District, 99 Miss., 739; 55 Sou., 963.) Enough
must remain to make a complete, intelligible, and valid
statute, which carries out the legislative intent.
(Pearson vs. Bass. 132 Ga., 117; 63 S. E., 798.) The
void provisions must be eliminated without causing
results affecting the main purpose of the Act, in a
manner contrary to the intention of the Legislature.
(State vs. A. C. L. R., Co., 56 Fla., 617, 642; 47 Sou.,
969; Harper vs. Galloway, 58 Fla., 255; 51 Sou., 226;
26 L. R. A., N. S., 794; Connolly vs. Union Sewer Pipe
Co., 184 U. S., 540, 565; People vs. Strassheim, 240
Ill., 279, 300; 88 N. E., 821; 22 L. R. A., N. S., 1135;
State vs. Cognevich, 124 La., 414; 50 Sou., 439.) The
language used in the invalid part of a statute can have
no legal force or efficacy for any purpose whatever, and
what remains must express the legislative will,
independently of the void part, since the court has no
power to legislate. (State vs. Junkin, 85 Neb., 1; 122 N.
W., 473; 23 L. R. A., N. S., 839; Vide, also,. U. S., vs.
Rodriguez [1918], 38 Phil., 759; Pollock vs. Farmers'
Loan and Trust Co. [1895], 158 U. S., 601, 635; 39
Law. ed., 1108, 1125; 15 Sup. Ct. Rep., 912; 6 R.C.L.,
121.)
It is contended that even if section 11, which makes the
Probation Act applicable only in those provinces in
which the respective provincial boards provided for the
salaries of probation officers were inoperative on
constitutional grounds, the remainder of the Act would
still be valid and may be enforced. We should be
inclined to accept the suggestions but for the fact that
said section is, in our opinion, is inseparably linked with
the other portions of the Act that with the elimination of
the section what would be left is the bare idealism of
the system, devoid of any practical benefit to a large
number of people who may be deserving of the
intended beneficial result of that system. The clear
policy of the law, as may be gleaned from a careful
examination of the whole context, is to make the
application of the system dependent entirely upon the
affirmative action of the different provincial boards
through appropriation of the salaries for probation
officers at rates not lower than those provided for
provincial fiscals. Without such action on the part of the
various boards, no probation officers would be
appointed by the Secretary of Justice to act in the
provinces. The Philippines is divided or subdivided into
provinces and it needs no argument to show that if not
one of the provinces — and this is the actual situation
now — appropriate the necessary fund for the salary of
a probation officer, probation under Act No. 4221 would
be illusory. There can be no probation without a
probation officer. Neither can there be a probation
officer without the probation system.
Section 2 of the Acts provides that the probation officer
shall supervise and visit the probationer. Every
probation officer is given, as to the person placed in
probation under his care, the powers of the police
officer. It is the duty of the probation officer to see that
the conditions which are imposed by the court upon the
probationer under his care are complied with. Among
those conditions, the following are enumerated in
section 3 of the Act:
That the probationer (a) shall indulge in no injurious or
vicious habits;
(b) Shall avoid places or persons of disreputable or
harmful character;
(c) Shall report to the probation officer as directed by
the court or probation officers;
(d) Shall permit the probation officer to visit him at
reasonable times at his place of abode or elsewhere;
(e) Shall truthfully answer any reasonable inquiries on
the part of the probation officer concerning his conduct
or condition; "(f) Shall endeavor to be employed
regularly; "(g) Shall remain or reside within a specified
place or locality;
(f) Shall make reparation or restitution to the aggrieved
parties for actual damages or losses caused by his
offense;
(g) Shall comply with such orders as the court may from
time to time make; and
(h) Shall refrain from violating any law, statute,
ordinance, or any by-law or regulation, promulgated in
accordance with law.
The court is required to notify the probation officer in
writing of the period and terms of probation. Under
section 4, it is only after the period of probation, the
submission of a report of the probation officer and
appropriate finding of the court that the probationer has
complied with the conditions of probation that probation
may be definitely terminated and the probationer finally
discharged from supervision. Under section 5, if the
court finds that there is non-compliance with said
conditions, as reported by the probation officer, it may
issue a warrant for the arrest of the probationer and
said probationer may be committed with or without bail.
Upon arraignment and after an opportunity to be heard,
the court may revoke, continue or modify the probation,
and if revoked, the court shall order the execution of
the sentence originally imposed. Section 6 prescribes
the duties of probation officers: "It shall be the duty of
every probation officer to furnish to all persons placed
on probation under his supervision a statement of the
period and conditions of their probation, and to instruct
them concerning the same; to keep informed
concerning their conduct and condition; to aid and
253
encourage them by friendly advice and admonition,
and by such other measures, not inconsistent with the
conditions imposed by court as may seem most
suitable, to bring about improvement in their conduct
and condition; to report in writing to the court having
jurisdiction over said probationers at least once every
two months concerning their conduct and condition; to
keep records of their work; make such report as are
necessary for the information of the Secretary of
Justice and as the latter may require; and to perform
such other duties as are consistent with the functions
of the probation officer and as the court or judge may
direct. The probation officers provided for in this Act
may act as parole officers for any penal or reformatory
institution for adults when so requested by the
authorities thereof, and, when designated by the
Secretary of Justice shall act as parole officer of
persons released on parole under Act Number Forty-
one Hundred and Three, without additional
compensation."
It is argued, however, that even without section 11
probation officers maybe appointed in the provinces
under section 10 of Act which provides as follows:
There is hereby created in the Department of Justice
and subject to its supervision and control, a Probation
Office under the direction of a Chief Probation Officer
to be appointed by the Governor-General with the
advise and consent of the Senate who shall receive a
salary of four eight hundred pesos per annum. To carry
out this Act there is hereby appropriated out of any
funds in the Insular Treasury not otherwise
appropriated, the sum of fifty thousand pesos to be
disbursed by the Secretary of Justice, who is hereby
authorized to appoint probation officers and the
administrative personnel of the probation officer under
civil service regulations from among those who
possess the qualifications, training and experience
prescribed by the Bureau of Civil Service, and shall fix
the compensation of such probation officers and
administrative personnel until such positions shall have
been included in the Appropriation Act.
But the probation officers and the administrative
personnel referred to in the foregoing section are
clearly not those probation officers required to be
appointed for the provinces under section 11. It may be
said, reddendo singula singulis, that the probation
officers referred to in section 10 above-quoted are to
act as such, not in the various provinces, but in the
central office known as the Probation Office
established in the Department of Justice, under the
supervision of the Chief Probation Officer. When the
law provides that "the probation officer" shall
investigate and make reports to the court (secs. 1 and
4); that "the probation officer" shall supervise and visit
the probationer (sec. 2; sec. 6, par. d); that the
probationer shall report to the "probationer officer"
(sec. 3, par. c.), shall allow "the probationer officer" to
visit him (sec. 3, par. d), shall truthfully answer any
reasonable inquiries on the part of "the probation
officer" concerning his conduct or condition (sec. 3,
par. 4); that the court shall notify "the probation officer"
in writing of the period and terms of probation (sec. 3,
last par.), it means the probation officer who is in
charge of a particular probationer in a particular
province. It never could have been intention of the
legislature, for instance, to require the probationer in
Batanes, to report to a probationer officer in the City of
Manila, or to require a probation officer in Manila to visit
the probationer in the said province of Batanes, to
place him under his care, to supervise his conduct, to
instruct him concerning the conditions of his probation
or to perform such other functions as are assigned to
him by law.
That under section 10 the Secretary of Justice may
appoint as many probation officers as there are
provinces or groups of provinces is, of course possible.
But this would be arguing on what the law may be or
should be and not on what the law is. Between is and
ought there is a far cry. The wisdom and propriety of
legislation is not for us to pass upon. We may think a
law better otherwise than it is. But much as has been
said regarding progressive interpretation and judicial
legislation we decline to amend the law. We are not
permitted to read into the law matters and provisions
which are not there. Not for any purpose — not even to
save a statute from the doom of invalidity.
Upon the other hand, the clear intention and policy of
the law is not to make the Insular Government defray
the salaries of probation officers in the provinces but to
make the provinces defray them should they desire to
have the Probation Act apply thereto. The sum of
P50,000, appropriated "to carry out the purposes of this
Act", is to be applied, among other things, for the
salaries of probation officers in the central office at
Manila. These probation officers are to receive such
compensations as the Secretary of Justice may fix
"until such positions shall have been included in the
Appropriation Act". It was the intention of the legislature
to empower the Secretary of Justice to fix the salaries
of the probation officers in the provinces or later on to
include said salaries in an appropriation act.
Considering, further, that the sum of P50,000
appropriated in section 10 is to cover, among other
things, the salaries of the administrative personnel of
the Probation Office, what would be left of the amount
can hardly be said to be sufficient to pay even nominal
salaries to probation officers in the provinces. We take
judicial notice of the fact that there are 48 provinces in
the Philippines and we do not think it is seriously
contended that, with the fifty thousand pesos
appropriated for the central office, there can be in each
province, as intended, a probation officer with a salary
not lower than that of a provincial fiscal. If this a correct,
the contention that without section 11 of Act No. 4221
said act is complete is an impracticable thing under the
remainder of the Act, unless it is conceded that in our
case there can be a system of probation in the
provinces without probation officers.
Probation as a development of a modern penology is a
commendable system. Probation laws have been
enacted, here and in other countries, to permit what
modern criminologist call the "individualization of the
punishment", the adjustment of the penalty to the
character of the criminal and the circumstances of his
particular case. It provides a period of grace in order to
aid in the rehabilitation of a penitent offender. It is
believed that, in any cases, convicts may be reformed
and their development into hardened criminals
aborted. It, therefore, takes advantage of an
opportunity for reformation and avoids imprisonment
so long as the convicts gives promise of reform. (United
States vs. Murray [1925], 275 U. S., 347 357, 358; 72
Law. ed., 309; 312, 313; 48 Sup. Ct. Rep., 146; Kaplan
vs. Hecht, 24 F. [2d], 664, 665.) The Welfare of society
is its chief end and aim. The benefit to the individual
convict is merely incidental. But while we believe that
probation is commendable as a system and its
implantation into the Philippines should be welcomed,
we are forced by our inescapable duty to set the law
aside because of the repugnancy to our fundamental
law.
In arriving at this conclusion, we have endeavored to
consider the different aspects presented by able
254
counsel for both parties, as well in their memorandums Without any pronouncement regarding costs. So
as in their oral argument. We have examined the cases ordered.
brought to our attention, and others we have been able
to reach in the short time at our command for the study Avanceña, C.J., Imperial, Diaz and Concepcion, JJ.,
and deliberation of this case. In the examination of the concur.
cases and in then analysis of the legal principles Villa-real and Abad Santos, JJ., concur in the result.
involved we have inclined to adopt the line of action
which in our opinion, is supported better reasoned
authorities and is more conducive to the general
welfare. (Smith, Bell & Co. vs. Natividad [1919], 40
Phil., 136.) Realizing the conflict of authorities, we have
declined to be bound by certain adjudicated cases
brought to our attention, except where the point or
principle is settled directly or by clear implication by the
more authoritative pronouncements of the Supreme
Court of the United States. This line of approach is
justified because:

(a) The constitutional relations between the Federal

and the State governments of the United States and
the dual character of the American Government is a
situation which does not obtain in the Philippines;

(b) The situation of s state of the American Union of the

District of Columbia with reference to the Federal
Government of the United States is not the situation of
the province with respect to the Insular Government
(Art. I, sec. 8 cl. 17 and 10th Amendment, Constitution
of the United States; Sims vs. Rives, 84 Fed. [2d], 871),

(c) The distinct federal and the state judicial

organizations of the United States do not embrace the
integrated judicial system of the Philippines
(Schneckenburger vs. Moran [1936], 35 Off. Gaz., p.
1317);

(d) "General propositions do not decide concrete

cases" (Justice Holmes in Lochner vs. New York
[1904], 198 U. S., 45, 76; 49 Law. ed., 937, 949) and,
"to keep pace with . . . new developments of times and
circumstances" (Chief Justice Waite in Pensacola Tel.
Co. vs. Western Union Tel. Co. [1899], 96 U. S., 1, 9;
24 Law. ed., 708; Yale Law Journal, Vol. XXIX, No. 2,
Dec. 1919, 141, 142), fundamental principles should
be interpreted having in view existing local conditions
and environment.

Act No. 4221 is hereby declared unconstitutional and

void and the writ of prohibition is, accordingly, granted.

255
 Before us are the consolidated cases of G.R. No.
2059721 and G.R. No. 164352.2
G.R. No. 164352 involves the appeal by petition for
review on certiorari of Caterpillar, Inc. (Caterpillar) to
reverse the decision promulgated on January 21,
20043 by the Court of Appeals (CA) in CA-G.R. SP No.
75526, and the resolution promulgated on June 30,
2004 denying the motion for reconsideration thereof.4
G.R. No. 205972 relates to the appeal brought by
Caterpillar to assail the decision and resolution
promulgated in CA-G.R. SP No. 102316 respectively
on May 8, 20125 and February 12, 2013,6 whereby the
CA affirmed the resolutions of the Department of
Justice (DOJ) finding that there was no probable cause
to indict Manolo P. Samson (Samson) for unfair
competition.
G.R. No. 205972 Antecedents
CATERPILLAR, INC., Petitioner Caterpillar is a foreign corporation engaged in the
vs. manufacture and distribution of footwear, clothing and
MANOLO P. SAMSON, Respondent related items, among others. Its products are known for
six core trademarks, namely, "CATERPILLAR", "CAT"
x-----------------------x "CATERPILLAR & DESIGN" "CAT AND DESIGN",
"WALKING MACHINES" and "TRACK-TYPE
G.R. No. 164352 TRACTOR & DESIGN (Core Marks),7 all of which are
alleged as internationally known. On the other hand,
CATERPILLAR, INC., Petitioner, Samson, doing business under the names and styles
vs.
of Itti Shoes Corporation, Kolm's Manufacturing
MANOLO P. SAMSON, Respondent. Corporation and Caterpillar Boutique and General
DECISION Merchandise, is the proprietor of various retail outlets
in the Philippines selling footwear, bags, clothing, and
BERSAMIN, J.: related items under the trademark "CATERPILLAR",
registered in 1997 under Trademark Registration No.
The determination of probable cause to charge a 64705 issued by the Intellectual Property Office (IPO).8
person in court for a criminal offense is exclusively
lodged in the Executive Branch of the Government, G.R. No. 164352
through the Department of Justice. Initially, the
On July 26, 2000, upon application of the National
determination is done by the investigating public
prosecutor, and on review by the Secretary of Justice Bureau of Investigation (NBI), the Regional Trial Court
(RTC), Branch 56, in Makati City issued Search
or his duly authorized subordinate. The courts will
respect the determination, unless the same shall be Warrants Nos. 00-022 to 00-032, inclusive, all for unfair
shown to have been made in grave abuse of discretion competition,9 to search the establishments owned,
amounting to lack or excess of jurisdiction. controlled and operated by Samson. The
implementation of the search warrants on July 27,
The Cases 2000 led to the seizure of various products bearing
Caterpillar's Core Marks.
Caterpillar filed against Samson several criminal
complaints for unfair competition in the Department of
Justice (DOJ), docketed as LS. Nos. 2000-13 54 to
2000-13 64, inclusive.
Additionally, on July 31, 2000, Caterpillar commenced
a civil action against Samson and his business entities,
with the IPO as a nominal party10 - for Unfair
Competition, Damages and Cancellation of Trademark
with Application for Temporary Restraining Order
(TRO) and/or Writ of Preliminary Injunction - docketed
as Civil Case No. Q-00-41446 of the RTC in Quezon
City. In said civil action, the RTC denied Caterpillar's
application for the issuance of the TRO on August 17,
2000.
The DOJ, through Senior State Prosecutor Jude R.
Romano, issued a joint resolution dated November 15,
200111recommending that Samson be criminally
charged with unfair competition under Section 168.3
(a),12 in relation to Section 123.l(e),13 Section
131.114 and Section 170,15 all of Republic Act No.
8293, or the Intellectual Property Code of the
Philippines (IP Code).
However, because Samson and his affiliate companies
allegedly continued to sell and distribute products
clothed with the general appearance of its own
products, Caterpillar again applied for another set of
search warrants against Samson and his businesses.
The RTC, Branch 172, in Valenzuela City issued
Search Warrants Nos. 12-V-00,16 13-V-00,17 20-V-
0018 and 29-V-0019 upon application of the NBI, by
virtue of the implementation of which several goods
were seized and confiscated by the NBI agents.
As a consequence, Caterpillar filed 26 criminal
complaints for unfair competition on January 31, 2001,
docketed as LS. Nos. 2001-42 to 2001-67, against
Samson and/or the occupants of his affiliate entities
before the DOJ.20 In due course, the DOJ, through
State Prosecutor Zenaida M. Lim, issued a joint
resolution dated September 28, 200121recommending
the filing of criminal complaints for unfair competition
under Section 168.3(a), in relation to Section 123 .1,
Section 131.1 and Section 170 of the IP Code.
Accordingly, six criminal complaints were filed in the
RTC, Branch 256, in Muntinlupa City, presided by
Judge Alberto L. Lerma, docketed as Criminal Cases
Nos. 02-238 to 02-243.
256
On January 17 and 22, 2002, Samson filed a petitions
for review with the Office of the Secretary of Justice to
appeal the joint resolutions in LS. Nos. 2000-1354 to
2000-136422 and LS. Nos. 2001-042 to 2001-067.23
On May 30, 2002, Samson filed a Motion to Suspend
Arraignment in Criminal Cases Nos. 02-238 to
243,24 citing the following as grounds:25
I.
THERE EXISTS PREJUDICIAL QUESTIONS
PENDING LITIGATION BEFORE THE REGIONAL
TRIAL COURT OF QUEZON CITY, BRANCH 90, IN
CIVIL CASE NO. Q-00-41446 ENTITLED:
"CATERPILLAR, INC., ET AL. VS. ITTI SHOES
CORPORATION, ET AL.," THE FINAL
RESOLUTIONS OF WHICH WILL DETERMINE THE
OUTCOME OF THE INSTANT CRIMINAL CASES.
II.
ACCUSED HAS FILED PETITIONS FOR REVIEW
WITH THE DEPARTMENT OF JUSTICE ASSAILING
THE RESOLUTIONS OF THE CHIEF STATE
PROSECUTOR WHO CAUSED THE FILING OF THE
INSTANT CASES AND ARE STILL PENDING
THEREIN UP TO THE PRESENT.
In the meanwhile, on July 10, 2002, the DOJ, through
Secretary Hernando B. Perez, issued a 00-41446 then pending in the RTC in Quezon City
resolution26 denying Samson's petition for review in
I.S. Nos. 2000-1354 to 2000-1364. Samson's motion
for reconsideration was likewise denied on May 26,
2003.
On September 23, 2002, Presiding Judge Lerma of the
RTC granted Samson's Motion to Suspend
Arraignment, and suspended the arraignment and all
other proceedings in Criminal Cases Nos. 02-240 to
02-243 until Civil Case No. Q-00-41446 was finally
resolved,27 holding:
After a careful scrutiny of the case, this Court finds that
private complainant, in Civil Case No. Q-00-41446,
seeks for the cancellation of the trademark
"CATERPILLAR" which is registered in the name of the
accused and to prevent the latter from using the said
trademark ("CATERPILLAR"), while the issue in the
instant case is the alleged unlawful use by the accused
of the trademark "CATERPILLAR" which is claimed to
be owned by the private complainant. From the
foregoing, this Court believes that there exists a
prejudicial question since the determination of who is
really the lawful or registered user of the trademark
"CATERPILLAR" will ultimately determine whether or
not the instant criminal action shall proceed. Clearly,
the issues raised in Civil Case No. Q-00-41446 is
similar or intimately related to the issue in the case at
bar for if the civil case will be resolved sustaining the
trademark registration of the accused for the trademark
CATERPILLAR, then the latter would have all the
authority to continue the use of the said trademark as
a consequence of a valid registration, and by reason of
which there may be no more basis to proceed with the
instant criminal action.28
After the RTC denied its motion for
reconsideration29 on December 5, 2002,30 Caterpillar
elevated the matter to the CA by petition
for certiorari on February 14, 2003,31 docketed as
C.A.-G.R. SP No. 75526 entitled Caterpillar, Inc. v.
Hon. Alberto L. Lerma, in his capacity as Presiding
Judge of Branch 256 of the Regional Trial Court,
Muntinlupa City, and Manolo P. Samson, alleging
grave abuse of discretion amounting to lack or excess
of jurisdiction on the part of the RTC in suspending the
arraignment and other proceedings in Criminal Cases
Nos. 02-238 to 02-243 on the ground of the existence
of an alleged prejudicial question in Civil Case No. Q-
whose resolution would determine the outcome of the
criminal cases.
Meanwhile, on January 13, 2003, Acting Justice
Secretary Ma. Merceditas N. Gutierrez reversed and
set aside the resolution issued by State Prosecutor Lim
in I.S. No. 2001-042 to 2001-067, and directed the
Chief State Prosecutor to cause the withdrawal of the
criminal informations filed against Samson in
court,32 disposing as follows:
ACCORDINGLY, the assailed joint resolution is
hereby REVERSED and SET ASIDE. The Chief State
Prosecutor is directed to forthwith cause the withdrawal
of the informations filed in court against respondent
Manolo P. Samson and to report action taken hereon
within ten (10) days from receipts hereof.33
Acting Justice Secretary Gutierrez based her
resolution on the order dated June 26, 2001, whereby
the RTC of Valenzuela City, Branch 172, had quashed
the 26 search warrants upon motion of
Samson.34 Consequently, the goods seized and
confiscated by virtue of the quashed search warrants
could no longer be admitted in evidence
Correspondingly, Presiding Judge Lerma of the RTC
ordered the withdrawal of Criminal Cases Nos. 02-240
to 02-243 on February 4, 2003.35
Aggrieved, Caterpillar assailed the order of Judge
Lerma for the withdrawal of Criminal Cases Nos. 02-
240 to 02-2432003 by petition for certiorari in the CA
on October 16, 2003, docketed as CA-G.R. SP No.
79937,36 and the CA ultimately granted the petition
for certiorari,37 setting aside the assailed January 13,
2003 resolution of the Acting Justice Secretary and
directing the re-filing of the withdrawn informations
against Samson. The Court ultimately affirmed the
CA's dec ision through the resolution promulgated on
October 17, 2005 in G.R. No. 169199, and ruling that
probable cause existed for the re-filing of the criminal
charges for unfair competition under the IP Code.38
In the assailed January 21, 2004 decision, 39 the CA
dismissed Caterpillar's petition for certiorari in CA-G.R.
SP No. 75526, viz.:
Petition has no merit.
The mere fact that public respondent denied
petitioner's motion for reconsideration does not justify
this petition on the ground of abuse of discretion. Grave
abuse of discretion means 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. (Benito vs. Comelec,
349 SCRA 705).
Petitioner in this case failed to overcome the burden of
showing how public respondent acted with grave
abuse of discretion in granting private respondent's
motion and denying his own motion for
reconsideration. What is clear is that public respondent
court acted judiciously. A petition for certiorariunder
Rule 65 of the Rules of Court will prosper only if there
257
is showing of grave abuse of discretion or an act
without or in excess of jurisdiction on the part of
respondent tribunal (Garcia vs. HRET, 312 SCRA
353).
Granting arguendo that public respondent court erred
in its ruling, still a petition for certiorari under Rule 65
cannot be justified. Where the court has jurisdiction
over the subject matter, the orders or decision upon all
questions pertaining to the cause are orders or
decisions within its jurisdiction and however erroneous
they may be, they cannot be corrected by certiorari (De
Baron vs. Court of Appeals, 368 SCRA 407).
WHEREFORE, foregoing premises considered, the
Petition having no merit in fact and in law is hereby
DENIED DUE COURSE and ordered DISMISSED.
With costs to Petitioners.
SO ORDERED.40
Caterpillar sought the reconsideration of the dismissal,
but the CA denied the motion on June 30, 2004.41
Hence, Caterpillar appealed the CA's decision in C.A.-
G.R. SP No. 75526 (G.R. No. 164352).
G .R. No. 205972
In the meanwhile, in August 2002, upon receiving the
information that Samson and his affiliate entities
continuously sold and distributed products bearing
Caterpillar's Core Marks without Caterpillar's consent,
the latter requested the assistance of the Regional
Intelligence and Investigation Division of the National
Region Public Police (RIID-NCRPO) for the conduct of
an investigation. Subsequently, after the investigation,
the RIID-NCRPO applied for and was granted 16
search warrants against various outlets owned or
operated by Samson in Mandaluyong, Quezon City,
Manila, Caloocan, Makati, Parañaque, Las Piñas,
Pampanga and Cavite. The warrants were served on
August 27, 2002,42 and as the result products bearing
Caterpillar's Core Marks were seized and confiscated.
Consequently, on the basis of the search warrants
issued by the various courts, Caterpillar again
instituted criminal complaints in the DOJ for violation of
Section 168.3(a), in relation to Sections 131.3, 123.l(e)
and 170 of the IP Code against Samson, docketed as
LS. Nos. 2002-995 to 2002-997; 2002-999 to 2002-
1010; and 2002-1036.
After the conduct of the preliminary investigation, the
DOJ, through State Prosecutor Melvin J.Abad, issued
a joint resolution dated August 21, 2003 dismissing the
complaint upon finding that there was no probable
cause to charge Samson with unfair competition.43
Caterpillar moved for the reconsideration of the
dismissal, but State Prosecutor Abad denied the
motion on June 18, 2004.44
The Secretary of Justice affirmed the dismissal of the
complaint through the resolution issued on September
19, 2005,45 and denied Caterpillar's motion for
reconsideration on December 20, 2007.
Accordingly, Caterpillar appealed to the CA through a
petition for review under Rule 43, Rules of Court (C.A.-
G.R. SP No. 102316).46
On May 8, 2012,47 however, the CA denied due course
to Caterpillar's petition for review, viz.:
WHEREFORE, premises considered, the petition
is DENIED DUE COURSE, and
accordingly, DISMISSED.
SO ORDERED.48
The CA opined that an appeal under Rule 43 to assail
the resolution by the Secretary of Justice determining
the existence or non-existence of probable cause was
an improper remedy; and that while it could treat an
appeal as a special civil action for certiorari under Rule
65, it could not do so therein because the allegations
of the petition did not sufficiently show grave abuse of
discretion on the part of the Secretary of Justice in
issuing the assailed resolutions.
Caterpillar filed a motion for reconsideration, but the
CA denied the motion for its lack of merit on February
12, 2013.49
Hence, Caterpillar commenced G.R. No. 205972.
Issues
Caterpillar submits that the CA erred as follows:
G.R. No. 164352
A.
THE COURT OF APPEALS COMMITTED SERIOUS
REVERSIBLE ERROR IN DENYING DUE COURSE
TO CATERPILLAR INC.'S PETITION FOR
CERTIORARI.
B.
THE COURT OF APPEALS COMMITTED SERIOUS
REVERSIBLE ERROR IN NOT HOLDING THAT THE
ORDER SUSPENDING PROCEEDINGS IN
CRIMINAL CASES NOS. 02-238 TO 02-243, ON THE
BASIS OF AN ALLEGED PREJUDICIAL QUESTION,
WAS CONTRARY TO LAW AND ESTABLISHED
JURISPRUDENCE.
C.
THE HONORABLE COURT OF APPEALS
COMMITTED SERIOUS REVERSIBLE ERROR IN
NOT HOLDING THAT A CRIMINAL COMPLAINT FOR
UNFAIR COMPETITION CAN PROCEED
INDEPENDENTLY OF, AND SIMULTANEOUS WITH,
THE CIVIL CASE FOR THE SAME.50
Caterpillar posits that the suspension of proceedings in
Criminal Cases Nos. 02-238 to 02-243 was contrary to
Rule 111 of the Rules of Court, Article 33 of the Civil
Code on independent civil actions, and Section 170 of
the IP Code, which specifically provides that the
criminal penalties for unfair competition were
independent of the civil and administrative sanctions
imposed by law; that the determination of the lawful
owner of the "CATERPILLAR" trademark in Civil Case
No. Q-00-41446 would not be decisive of the guilt of
Samson for unfair competition in Criminal Cases Nos.
02-238 to 02-243 because registration was not an
element of the crime of unfair competition; that the civil
case sought to enforce Samson's civil liability arising
from the IP Code while the criminal cases would
enforce Samson's liability arising from the crime of
unfair competition; and that the Court already ruled
in Samson v. Daway51 that Civil Case No. Q-00-41446
was an independent civil action under Article 33 of
the Civil Code and, as such, could proceed
independently of the criminal actions.
In his comment,52 Samson counters that the issues of
the lawful and registered owner of the trademark, the
true owner of the goodwill, and whether
"CATERPILLAR" was an internationally well-known
258
mark are intimately related to the issue of guilt in the
criminal actions, the resolution of which should
determine whether or not the criminal actions for unfair
competition could proceed.
G.R. No. 205972
In this appeal, the petitioner interposes that:
THE HONORABLE COURT OF APPEALS ERRED IN
DISMISSING THE PETITIONER'S PETITION FOR
REVIEW SOLELY ON THE GROUND OF AN
ALLEGED WRONG REMEDY, DESPITE
PETITIONERS HAVING CLEARLY ESTABLISHED
THAT THE SECRETARY OF JUSTICE ACTED WITH
GRAVE ABUSE OF DISCRETION IN ISSUING THE
RESOLUTIONS DATED 19 SEPTEMBER 2005 AND
20 DECEMBER 2007, AFFIRMING THE FINDINGS
OF THE INVESTIGATING PROSECUTOR THAT NO
PROBABLE CAUSE EXISTS TO CHARGE THE
RESPONDENT OF THE CRIME OF UNFAIR
COMPETITION.53
Caterpillar seeks the liberal interpretation of procedural
rules in order to serve the higher interest of substantial
justice following the denial by the CA of its petition for
being an incorrect remedy; and insists that it presented
substantial evidence to warrant a finding of probable
cause for unfair competition against Samson.
In sum, the issues to be resolved in these consolidated
cases are: firstly, whether or not the CA committed a
reversible error in ruling that the trial court a quo did not
commit grave abuse of discretion in suspending the
criminal proceedings on account of a prejudicial
question; and, secondly, whether or not the CA
committed reversible error in upholding the decision of
the Secretary of Justice finding that there was no
probable cause to charge Samson with unfair
competition.
Rulings of the Court
G.R. No. 164352
The appeal in G.R. No. 164352 is meritorious.
We note, to begin with, that Civil Case No. Q-00-41446,
the civil case filed by Caterpillar in the RTC in Quezon
City, was for unfair competition, damages and
cancellation of trademark, while Criminal Cases Nos.
Q-02-108043-44 were the criminal prosecution of
Samson for unfair competition. A common element of
all such cases for unfair competition - civil and criminal
- was fraud. Under Article 33 of the Civil Code, a civil
action entirely separate and distinct from the criminal
action may be brought by the injured party in cases of
fraud, and such civil action shall proceed
independently of the criminal prosecution. In view of its
being an independent civil action, Civil Case No. Q-00-
41446 did not operate as a prejudicial question that
justified the suspension of the proceedings in Criminal
Cases Nos. Q-02-108043-44.
In fact, this issue has already been raised in relation to
the suspension of the arraignment of Samson in
Criminal Cases Nos. Q-02-108043-44 in Samson v.
Daway,54 and the Court resolved it against Samson
and in favor of Caterpillar thusly:
Anent the second issue, petitioner failed to
substantiate his claim that there was a prejudicial
question. In his petition, he prayed for the reversal of
the March 26, 2003 order which sustained the denial of
his motion to suspend arraignment and other
proceedings in Criminal Case Nos. Q-02-108043-44.
For unknown reasons, however, he made no
discussion in support of said prayer in his petition and
reply to comment. Neither did he attach a copy of the
complaint in Civil Case No. Q-00-41446 nor quote the
pertinent portion thereof to prove the existence of a
prejudicial question.
At any rate, there is no prejudicial question if the civil
and the criminal action can, according to law, proceed
independently of each other. Under Rule 111, Section
3 of the Revised Rules on Criminal Procedure, in the
cases provided in Articles 32, 33, 34 and 2176 of the
Civil Code, the independent civil action may be brought
by the offended party. It shall proceed independently of
the criminal action and shall require only a
preponderance of evidence.
In the case at bar, the common element in the acts
constituting unfair competition under Section 168 of
R.A. No. 8293 is fraud. Pursuant to Article 33 of the
Civil Code, in cases of defamation, fraud, and physical
injuries, a civil action for damages, entirely separate
and distinct from the criminal action, may be brought
by the injured party. Hence, Civil Case No. Q-00-
41446, which as admitted by private respondent
also relate to unfair competition, is an independent
civil action under Article 33 of the Civil Code. As
such, it will not operate as a prejudicial question
that will justify the suspension of the criminal
cases at bar.55 (Bold emphasis supplied)
Secondly, a civil action for damages and cancellation
of trademark cannot be considered a prejudicial
question by which to suspend the proceedings in the
criminal cases for unfair competition. A prejudicial
question is that which arises in a civil case the
resolution of which is a logical antecedent of the issues
to be determined in the criminal case. It must appear
not only that the civil case involves facts upon which
the criminal action is based, but also that the resolution
of the issues raised in the civil action will necessarily
be determinative of the criminal case.56 As stated
in Librodo v. Judge Coscolluela, Jr.:57
A prejudicial question is one based on a fact distinct
and separate from the crime but so intimately
connected with it that it determines the guilt or
innocence of the accused, and for it to suspend the
criminal action, it must appear not only that said case
involves facts intimately related to those upon which
the criminal prosecution would be based but also that
in the resolution of the issue or issues raised in the civil
case, the guilt or innocence of the accused would
necessarily be determined. It comes into play
generally in a situation where a civil action and a
criminal action are both pending and there exists
in the former an issue which must be preemptively
resolved before the criminal action may proceed,
because howsoever the issue raised in the civil
action is resolved would be determinative juris et
de jure of the guilt or innocence of the accused in
the criminal case.58 (Bold underscoring supplied for
emphasis)
The elements of a prejudicial question are provided in
Section 7 of Rule 111, Rules of Court, to wit: (a) a
previously instituted civil action involves an issue
similar to or intimately related to the issue raised in the
subsequent criminal action, and (b) the resolution of
such issue determines whether or not the criminal
action may proceed.59
An examination of the nature of the two kinds of cases
involved is necessary to determine whether a
prejudicial question existed.
259
An action for the cancellation of trademark like Civil
Case No. Q-00-41446 is a remedy available to a
person who believes that he is or will be damaged by
the registration of a mark.60 On the other hand, the
criminal actions for unfair competition (Criminal Cases
Nos. Q-02-108043-44) involved the determination of
whether or not Samson had given his goods the
general appearance of the goods of Caterpillar, with
the intent to deceive the public or defraud Caterpillar
as his competitor.61 In the suit for the cancellation of
trademark, the issue of lawful registration should
necessarily be determined, but registration was not a
consideration necessary in unfair
competition.62 Indeed, unfair competition is committed
if the effect of the act is "to pass off to the public the
goods of one man as the goods of another;" 63 it is
independent of registration. As fittingly put in R.F. &
Alexander & Co. v. Ang,64 "one may be declared unfair
competitor even if his competing trade-mark is
registered."
Clearly, the determination of the lawful ownership of
the trademark in the civil action was not determinative
of whether or not the criminal actions for unfair
competition shall proceed against Samson.
G.R. No. 205972
The petition for review on certiorari in G.R. No. 205972
is denied for being bereft of merit.1âwphi1
Firstly, Caterpillar assailed the resolution of the
Secretary of Justice by filing a petition for review under
Rule 43 of the Rules of Court. Such resort to the
petition for review under Rule 43 was erroneous,65 and
the egregious error warranted the denial of the appeal.
The petition for review under Rule 43 applied to all
appeals to the CA from quasi-judicial agencies or
bodies, particularly those listed in Section 1 of Rule 43.
However, the Secretary of Justice, in the review of the
findings of probable cause by the investigating public
prosecutor, was not exercising a quasi-judicial
function, but performing an executive function.66
Moreover, the courts could intervene in the
determination of probable cause only through the
special civil action for certiorari under Rule 65 of
the Rules of Court, not by appeal through the petition
for review under Rule 43. Thus, the CA could not
reverse or undo the findings and conclusions on
probable cause by the Secretary of Justice except
upon clear demonstration of grave abuse of discretion
amounting to lack or excess of jurisdiction committed
by the Secretary of Justice.67 Caterpillar did not so
demonstrate.
And, secondly, even discounting the technicalities as
to consider Caterpillar's petition for review as one
brought under Rule 65, the recourse must still fail.
Probable cause for the purpose of filing an information
in court consists in such facts and circumstances as
would engender a well-founded belief that a crime has
been committed and the accused may probably be
guilty thereof.68The determination of probable cause
lies solely within the sound discretion of the
investigating public prosecutor after the conduct of a
preliminary investigation. It is a sound judicial policy to
refrain from interfering with the determination of what
constitutes sufficient and convincing evidence to
establish probable cause for the prosecution of the
accused.69 Thus, it is imperative that by the nature of
his office, the public prosecutor cannot be compelled to
file a criminal information in court if he is not convinced
of the sufficiency of the evidence adduced for a finding
of probable cause.70 Neither can he be precluded from
filing an information if he is convinced of the merits of
the case.
In not finding probable cause to indict Samson for
unfair competition, State Prosecutor Abad as the
investigating public prosecutor discharged the
discretion given to him by the law. Specifically, he
resolved as follows:
It appears from the records that respondent started
marketing his (class 25) products bearing the
trademark Caterpillar as early as 1992. In 1994,
respondent caused the registration of the trademark
"Caterpillar With A Triangle Device Beneath The Letter
[A]" with the Intellectual Property Office. Sometime on
June 16, 1997, the IPO issued Certificate of
Registration No. 64705 which appears to be valid for
twenty (20) years, or up to June 16, 2017. Upon the
strength of this registration, respondent continued with
his business of marketing shoes, slippers, sandals,
boots and similar Class 25 items bearing his registered
trademark "Caterpillar". Under the law, respondent's
operative act of registering his Caterpillar trademark
and the concomitant approval/issuance by the
governmental entity concerned, conferred upon him
the exclusive right to use said trademark unless
otherwise declared illegal. There being no evidence to
controvert the fact that respondent's Certificate of
Registration No. 64705 covering Caterpillar trademark
was fraudulently or illegally obtained, it necessarily
follows that its subsequent use and/or being passed on
to the public militates malice or fraudulent intent on the
part of respondent. Otherwise stated and from the facts
obtaining, presumption of regularity lies, both from the
standpoint of registration and use/passing on of the
assailed Caterpillar products.
Complainant's argument that respondent may still be
held liable for unfair competition by reason of his
having passed on five (5) other Caterpillar products like
"Cat", "Caterpillar", "Cat and Design", "Walking
Machines" and "Track-Type Tractor Design" is equally
difficult to sustain. As may be gleaned from the records,
respondent has been engaged in the sale and
distribution of Caterpillar products since 1992 leading
to the establishment of numerous marketing outlets. As
such, it would be difficult to assail the presumption that
respondent has already established goodwill insofar as
his registered Caterpillar products are concerned. On
the other hand, complainant's registration of the other
Caterpillar products appears to have been caused only
in 1995. In this premise, respondent may be
considered as prior user, while the latter, a subsequent
one. Jurisprudence dictates that prior user of the
trademark by one, will controvert the claim by a
subsequent one.71
We reiterate that the full discretionary authority to
determine the existence of probable cause is lodged in
the Executive Branch of the Government, through the
public prosecutor, in the first instance, and the
Secretary of Justice, on review. Such authority is
exclusive, and the courts are prohibited from
encroaching on the executive function, unless there is
a clear showing of grave abuse of discretion amounting
to lack or excess of jurisdiction on the part of the public
prosecutor or the Secretary of Justice. As declared
in Callo-Claridad v. Esteban:72
A public prosecutor alone determines the sufficiency of
evidence that establishes the probable cause justifying
the filing of a criminal information against the
respondent because the determination of existence of
a probable cause is the function of the public
260

prosecutor. Generally, the public prosecutor is afforded Muntinlupa City to reinstate Criminal Cases Nos. Q-02-
a wide latitude of discretion in the conduct of a 108043-44 and forthwith try and decide them without
preliminary investigation. Consequently, it is a sound undue delay; DENIES the petition for review
judicial policy to refrain from interfering in the conduct on certiorari in G.R. No. 205972;
of preliminary investigations, and to just leave to the and ORDERS respondent Manolo P. Samson to pay
Department of Justice the ample latitude of discretion the costs of suit.
in the determination of what constitutes sufficient
SO ORDERED.
evidence to establish probable cause for the
prosecution of supposed offenders. Consistent with
LUCAS P. BERSAMIN
this policy, courts do not reverse the Secretary of
Associate Justice
Justice's findings and conclusions on the matter of
probable cause except in clear cases of grave abuse WE CONCUR:
of discretion. By way of exception, however, judicial
review is permitted where the respondent in the MARIA LOURDES P.A. SERENO
preliminary investigation clearly establishes that the
Chief Justice
public prosecutor committed grave abuse of discretion, Chairperson
that is, when the public prosecutor has exercised his
discretion in an arbitrary, capricious, whimsical or
despotic manner by reason of passion or personal TERESITA J.
ESTELA M. PERLAS-
LEONARDO-DE
hostility, patent and gross enough as to amount to an BERNABE
CASTRO
evasion of a positive duty or virtual refusal to perform a Associate Justice
duty enjoined by law. Moreover, the trial court may Associate Justice
ultimately resolve the existence or nonexistence of
probable cause by examining the records of the ALFREDO BENJAMIN S. CAGUIOA
preliminary investigation when necessary for the Associate Justice
orderly administration of justice. Although policy
considerations call for the widest latitude of deference CERTIFICATION
to the public prosecutor's findings, the courts should
never shirk from exercising their power, when the Pursuant to the Section 13, Article VIII of the
circumstances warrant, to determine whether the Constitution, I certify that the conclusions in the above
public prosecutor's findings are supported by the facts, Decision had been reached in consultation before the
and by the law. case was assigned to the writer of the opinion of the
Court’s Division.
Relevantly, grave abuse of discretion means such
capricious or whimsical exercise of judgment that is MARIA LOURDES P.A. SERENO
equivalent to lack of jurisdiction. The abuse of Chief Justice
discretion must be grave, as when 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 a positive duty Footnotes
or to a virtual refusal to perform the duty enjoined, or to
act at all, in contemplation of law, as to be equivalent 1 Rollo (G .R. No. 205972), pp. 61-104.
to having acted without jurisdiction.73 Herein,
2
Caterpillar did not show the grave abuse of discretion Rollo (G.R. No. 164352), pp. 16-61.
on the part of the Secretary of Justice.
3Id. at 73-76; penned by Associate Justice Jose L.
WHEREFORE, the Court GRANTS the petition for Sabio, Jr., with Associate Justice Delilah Vidallon-
review in G.R. No. 164352; SETS ASIDE the decision Magtolis and Associate Justice Hakim S. Abdulwahid
promulgated on January 21, 2004 in CA-G.R. SP No. concurring.
75526; DIRECTS the Regional Trial Court in
4
Id. at. 88.
5
Rollo (G.R. No. 205972), pp. 112-117; penned by
Associate Justice Juan Q. Enriquez, Jr., with Associate
Justice Apolinario D. Bruselas, Jr. and Associate
Justice Manuel M. Barrios concurring.
6
Id. at 120-122.
7 Rollo (G.R. No. 164352), p. 19.
8
Id. at. 477.
9
Id. at 121-128.
10
Id. at 129-144.
11 Id. at 172-197.
12 168.3. In particular, and without in any way limiting
the scope of protection against unfair competition, the
following shall be deemed guilty of unfair competition:
(a) Any person, who is selling his goods and gives them
the general appearance of goods of another
manufacturer or dealer, either as to the goods
themselves or in the wrapping of the packages in which
they are contained, or the devices or words thereon, or
in any other feature of their appearance, which would
be likely to influence purchasers to believe that the
goods offered are those of a manufacturer or dealer,
other than the actual manufacturer or dealer, or who
otherwise clothes the goods with such appearance as
shall deceive the public and defraud another of his
legitimate trade, or any subsequent vendor of such
goods or any agent of any vendor engaged in selling
such goods with a like purpose;
13
123.1. A mark cannot be registered if it:
(e) Is identical with, or confusingly similar to, or
constitutes a translation of a mark which is considered
by the competent authority of the Philippines to be well-
known internationally and in the Philippines, whether or
not it is registered here, as being already the mark of a
person other than the applicant for registration, and
used for identical or similar goods or
services: Provided, That in determining whether a
mark is well-known, account shall be taken of the
knowledge of the relevant sector of the public, rather
than of the public at large, including knowledge in the
261
 34 56
Philippines which has been obtained as a result of the Id. at 539. Ras v. Rasul, Nos. L-50441-42, September 18,
promotion of the mark; 1980, 100 SCRA 125, 129-130; Benitez v.
35 Id. at 543. Concepcion. Jr., No. L-14646, May 30, 1961, 2 SCRA
14 131.1. An application for registration of a mark filed 178, 181; De Leon v. Mabanag, 70 Phil. 202 (1940)
36
in the Philippines by a person referred to in Section 3, Id. at 31.
57
and who previously duly filed an application for 37 No. L-56995, August 30, 1982, 116 SCRA 303.
Id. at 578-585.
registration of the same mark in one of those countries,
58
shall be considered as filed as of the day the 38 Id. at 309-310.
Rollo (G.R. No. 205972), pp. 653-654; reference to
application was first filed in the foreign country. this affirmance was also made 59See San Miguel Properties, Inc. v. Perez, G.R. No.
15 in Samson v. Caterpillar, Inc., G.R. No. 169882, 166836, September 4, 2013, 705 SCRA 38, 55.
Section 170. Penalties. - Independent of the civil and
September 12, 2007, 533 SCRA 88, 95.
administrative sanctions imposed by law, a criminal 60 Section 151.1 (b), IP Code.
penalty of imprisonment from two (2) years to five (5) 39 Supra note 3.
years and a fine ranging from Fifty thousand pesos 61Levi Strauss (Phils.), Inc. v. Lim, G.R. No. 162311,
(₱50,000) to Two hundred thousand pesos 40 Id. at 75. December 4, 2008, 573 SCRA 25, 44.
(₱200,000), shall be imposed on any person who is
41
found guilty of committing any of the acts mentioned in Rollo (G.R. No. 164352), p. 78. 62Mighty Corp. v. E. & J Gallo Winery, G.R. No.
Section 155, Section 168 and Subsection 169.1. 42 154342, July 14, 2004, 434SCRA 473, 493.
Rollo (G.R. No. 205972), p. 71.
16 Rollo (G.R. No. 164352), pp. 148-153. 43
63 Id.
Id. at 216-236.
17 Id. at 154-159. 44
64 97 Phil. 157, 162.
Id. at 214.
18 Id. at 160-165. 45
65Callo-Claridad v. Esteban, G.R. No. 191567, March
Id. at 71.
19
20, 2013, 694 SCRA 185, 196; Levi Strauss (Phils.),
Id. at 166-171. 46 Inc. vs. Lim, supra, note 61, at 38-39;
Id. at 72.
20 Id. at 29. 47
66 Callo-Claridad v. Esteban, at 196-197.
Id. at 112-117.
21 Id. at 199-227. 48
67 Id. at 197.
Id. at 117.
22 Id. at 262-276. 49
68 Id. at 199.
Id. at 120-122.
23 Id. at 242-259. 50
69 Id.
Rollo (G.R. No. 164352), pp. 39-40.
24 Id. at 278-285. 51
70 Supra note 55, at 40.
G.R. Nos. 160054-55, July 21, 2004, 434 SCRA 612,
25 Id. at 278. 620. 71 Rollo (G.R. No. 205972), pp. 234-235.
52
26 Id. at 329-330. Rollo (G.R. No. 164352), pp. 475-500. 72 Supra note 65, at 199-200.
53
27 Id. at. 345-346 Rollo (G.R. No. 205972), p. 73. 73
Julie's Franchise Corporation v. Ruiz, G.R. No.
28 54 G.R. No. 160054-55, July 21, 2004, 434 SCRA 612 180988, August 28, 2009, 597 SCRA 463, 471.
Id. at 345.
(Samson moved in the RTC for the suspension of the
29 Id. at 347-352. arraignment and other proceedings in Criminal Cases
30
Nos. Q-02-108043-44 on the ground that a prejudicial
Id. at 362-363. question that was the logical antecedent in the criminal
31 actions existed in Civil Case No. Q-00-41446 that
Id. at 364-399.
warranted the suspension of the proceedings in the
32 Id. at 537-542. criminal cases).
55
33 Id. at 542. Id. at 620-621.
262

G.R. No. 203770, November 23, 2016
MANUELA AZUCENA MAYOR, Petitioner, v. EDWIN
TIU AND DAMIANA CHARITO
MARTY, Respondents.
DECISION
MENDOZA, J.:
This is a Petition for Review on Certiorari under Rule
45 of the Rules of Court assailing the October 5,
20111 and September 24, 20122
Resolutions of the Court of Appeals (CA) in CA-G.R.
SP No. 06256, which dismissed the petition filed by
Remedios Tiu (Remedios) and Manuela Azucena
Mayor (Manuela) for procedural infirmities. The said
CA petition challenged the January 20, 20113 and June
10, 20114 Orders of the Regional Trial Court, Branch 6,
Tacloban City (RTC-Br. 6), in Sp. Proc. No. 2008-05-
30, a case for Probate of Last Will and Testament and
Issuance of Letters of Testamentary.
The Antecedents:
On May 25, 2008, Rosario Guy-Juco Villasin Casilan
(Rosario), the widow of the late Primo Villasin (Primo),
passed away and left a holographic Last Will and
Testament,5 wherein she named her sister, Remedios
Tiu (Remedios), and her niece, Manuela Azucena
Mayor (Manuela), as executors. Immediately
thereafter, Remedios and Manuela filed a petition for
the probate of Rosario's holographic will6 with prayer
for the issuance of letters testamentary (probate
proceedings). The petition was raffled to the Regional
Trial Court, Branch 9, Tacloban City (RTC-Br. 9) and
docketed as Sp. Proc. No. 2008-05-30. They averred
that Rosario left properties valued at approximately
P2.5 million.
On May 29, 2008, respondent Damiana Charito Marty
(Marty) claiming to be the adopted daughter of Rosario,
filed a petition for letters of administration before the
RTC, Branch 34, Tacloban City (RTC-Br. 34), docketed
as Sp. Proc. No. 2008-05-32, but it was not given due
course because of the probate proceedings. Per
records, this dismissal is subject of a separate
proceeding filed by Marty with the CA Cebu City,
docketed as CA G.R. SP No. 04003.7
On June 12, 2008, in its Order,8 the RTC-Br. 9 found
the petition for probate of will filed by Remedios and
Manuela as sufficient in form and substance and set
the case for hearing.
Consequently, Marty filed her Verified Urgent
Manifestation and Motion,9 dated June 23, 2008,
stating that Remedios kept the decedent Rosario a
virtual hostage for the past ten (10) years and her
family was financially dependent on her which led to
the wastage and disposal of the properties owned by
her and her husband, Primo. Marty averred that until
the alleged will of the decedent could be probated and
admitted, Remedios
and her ten (10) children had no standing to either
possess or control the properties comprising the estate
of the Villasins. She prayed for the probate court to: 1)
order an immediate inventory of all the properties
subject of the proceedings; 2) direct the tenants of the
estate, namely, Mercury Drug and Chowking, located
at Primrose Hotel, to deposit their rentals with the court;
3) direct Metrobank, P. Burgos Branch, to freeze the
accounts in the name of Rosario, Primrose
Development Corporation (Primrose) or Remedios;
and 4) lock up the Primrose Hotel in order to preserve
the property until final disposition by the court.
On July 8, 2008, Remedios and Manuela filed their
Comment/Opposition10 to the urgent manifestation
averring that Marty was not an adopted child of the
Villasins based on a certification issued by the Office
of the Clerk of Court of Tacloban City, attesting that no
record of any adoption proceedings involving Marty
existed in their records. They also argued that the
probate court had no jurisdiction over the properties
mistakenly claimed by Marty as part of Rosario's estate
because these properties were actually owned by, and
titled in the name of, Primrose. Anent the prayer to
direct the tenants to deposit the rentals to the probate
court, Remedios and Manuela countered that the
probate court had no jurisdiction over properties owned
by third persons, particularly by Primrose, the latter
having a separate and distinct personality from the
decedent's estate.
In her Reply,11 dated July 15, 2008, Marty cited an
order of the Court of First Instance of Leyte (CFI Leyte)
in SP No. 1239,12 claiming that as early as March 3,
1981, the veil of corporate entity of Primrose was
pierced on the ground that it was a closed family
corporation controlled by Rosario after Primo's death.
Thus, Marty alleged that "piercing" was proper in the
case of Rosario's estate because the incorporation of
Primrose was founded on a fraudulent consideration,
having been done in contemplation of Primo's death.
Further, on July 22, 2008, in her Opposition to the
Petition for the Approval of the Will of the Late Rosario
Guy-Juco Villasin Casilan,13 Marty impugned the
authenticity of her holographic will.
Meanwhile, Edwin Tiu (Edwin), a son of Remedios,
also filed his Opposition,14 dated June 13, 2008.
After a protracted exchange of pleadings, the parties
submitted their respective memoranda.
The January 14, 2009 Order
In its January 14, 2009 Order,15 the RTC-Br. 9 granted
the motion of Marty and appointed the OIC Clerk of
Court as special administrator of the Estate. The
Probate Court also ordered Mercury Drug and
Chowking to deposit the rental income to the court and
Metrobank to freeze the bank accounts mentioned in
the motion of Marty. The doctrine of piercing the
corporate veil was applied in the case considering that
Rosario had no other properties that comprised her
estate other than Primrose. According to the probate
court, for the best interest of whoever would be
adjudged as the legal heirs of the Estate, it was best to
preserve the properties from dissipation.
On January 22, 2009, Remedios and Manuela filed
their Motion for Inhibition16 on the ground of their loss
of trust and confidence in RTC-Br. 9 Presiding Judge
Rogelio C. Sescon (Judge Sescon) to dispense justice.
Later, they also filed their Motion for
Reconsideration Ad Cautelam,17 dated February 3,
2009, arguing that Rosario's estate consisted only of
shares of stock in Primrose and not the corporation
itself. Thus, the probate court could not order the
lessees of the corporation to remit the rentals to the
Estate's administrator. With regard to the appointment
263
of a special administrator, Remedios and Manuela
insisted that it be recalled. They claimed that if ever
there was a need to appoint one, it should be the two
of them because it was the desire of the decedent in
the will subject of the probation proceedings.
In its Order,18 dated March 27, 2009, the RTC-Br. 9
denied the motion for reconsideration for lack of merit
and affirmed its January 14, 2009 Order. The presiding
judge, Judge Sescon, also granted the motion for
inhibition and ordered that the records of the case be
referred to the RTC Executive Judge for reraffling. The
case was later re-raffled to RTC-Br.6, Judge Alphinor
C. Serrano, presiding judge.
Aggrieved by the denial of their motion for
reconsideration, Remedios and Manuela filed a petition
for certiorari with the CA in Cebu City, docketed as CA-
G.R. S.P. No. 04254, assailing the January 14, 2009
and March 27, 2009 Orders of the RTC-Br. 9.19
Ruling of the CA
In its October 16, 2009 Decision,20 the
CA reversed the assailed orders of the RTC Br. 9,
except as to the appointment of a special administrator
insofar as this relates to properties specifically
belonging to the "Estate." It held that Primrose had a
personality separate and distinct from the estate of
the decedent and that the probate court had no
jurisdiction to apply the doctrine of piercing the
corporate veil.
According to the CA, nowhere in the assailed orders of
the probate court was it stated that its determination of
the title of the questioned properties was only for the
purpose of determining whether such properties ought
to be included in the inventory. When the probate court
applied the doctrine of "piercing," in effect, it
adjudicated with finality the ownership of the properties
in favor of the Estate. The CA stated that RTC-Br. 9
had no jurisdiction to adjudicate ownership of a
property claimed by another based on adverse title;
and that questions like this must be submitted to a court
of general jurisdiction and not to a probate court.
The CA added that assuming that the probate court's
determination on the issue of ownership was merely
intended to be provisional, Marty's contentions still had
no merit. The properties, which she claimed to be part
of the estate of Rosario and over which she claimed
co-ownership, comprised of real properties registered
under the Torrens system. As such, Primrose was
considered the owner until the titles to those properties
were nullified in an appropriate ordinary action. The CA
further stated that the RTC erroneously relied on the
order issued by the CFI Leyte in 1981, in the probate
proceedings involving the estate of Primo. Whatever
determination the CFI made at the time regarding the
title of the properties was merely provisional, hence,
not conclusive as to the ownership.
By reason of the favorable decision by the CA,
Remedios and Manuela filed their Motion to Partially
Revoke the Writ of Execution Enforcing the January
14, 2009 Order of the Honorable Court and
Manifestation in Compliance with the October 21, 2009
Order (Ad Cautelam),21 dated October 27, 2009.
In its Order,22 dated November 17, 2009, the RTC-Br.
6 partially granted the motion as it revoked the power
of the special administrator to oversee the day-to-day
operations of Primrose. It also revoked the order with
respect to Mercury Drug and Chowking, reasoning out
that the said establishments dealt with Primrose, which
had a personality distinct and separate from the estate
of the decedent. In the said order, Atty. Blanche A.
Sa1ino nominated by oppositors Marty and Edwin, was
appointed special administrator to oversee the day-to-
day operations of the estate. The same order also
upheld the January 14, 2009 Order, as to the conduct
and inventory of all the properties comprising the
estate.
This order was not questioned or appealed by the
parties.
Omnibus Motion
On September 24, 2010, or almost ten (10) months
after the November 17, 2009 Order of the probate court
was issued, Marty, together with her new counsel, filed
her Omnibus Motion,23 praying for the probate court to:
1) order Remedios and Manuela to render an
accounting of all the properties and assets comprising
the estate of the decedent; 2) deposit or consign all
rental payments or other passive income derived from
the properties comprising the estate; and 3) prohibit the
disbursement of funds comprising the estate of the
decedent without formal motion and approval by the
probate court.
Ruling of the RTC-Br. 6
In its January 20, 2011 Order, the RTC-Br. 6 granted
Marty's Omnibus Motion. Although it agreed with the
October 16, 2009 CA Decision reversing the January
14, 2009 Order of the RTC-Br. 9, nonetheless, it
acknowledged the urgency and necessity of appointing
a special administrator. According to the probate court,
considering that there was clear evidence of a
significant decrease of Rosario's shares in the
outstanding capital stock of Primrose,24 prudence
dictated that an inquiry into the validity of the transfers
should be made. A final determination of this matter
would be outside the limited jurisdiction of the probate
court, but it was likewise settled that the power to
institute an action for the recovery of a property claimed
to be part of the estate was normally lodged with the
executor or administrator. Thus, the probate court
disposed:
WHEREFORE, for the reasons aforestated, and so as
not to render moot any action that the special
administrator, or the regular administrator upon the
latter's qualification and appointment, may deem
appropriate to take on the matter (i.e. Whether or not
to institute in the name of the estate the appropriate
action for the recovery of the shares of stock), this
Court hereby GRANTS Oppositor Marty's Omnibus
Motion, dated September 24, 2010, and thus hereby:
1. DIRECTS petitioners, either individually or jointly,
to: (a) RENDER AN ACCOUNTINGof all the properties
and assets comprising the estate of the decedent that
may have come into their possession; and, (b)
DEPOSIT OR CONSIGN all the rentals payments or
such other passive incomes from the properties and
assets registered in the name of Primrose
Development Corporation, including all income derived
from the Primrose Hotel and the lease contracts with
Mercury Drug and Chowking Restaurant, both within
fifteen (15) days from receipt of this Order;
2. DIRECTS the Special Administrator to take
possession and charge of the properties comprising
the decedent's estate, specially those pertaining to the
264
sharesholding of the decedent in Primrose
Development Corporation, to determine whether or not
action for the recovery of the shares of stock
supposedly transferred from the decedent to
petitioners Remedios Tiu, Manuela Azucena Mayor
should be instituted in the name of the estate against
the said transferees and to submit a Report on the
foregoing matters to this Court, within fifteen (15) days
from receipt of this Order; and,
3. ORDERS that no funds comprising the estate of the
decedent shall be disbursed without formal Motion
therefor, with the conformity of the Special
Administrator, duly approved by this Court.
SO
ORDERED. cralawlawlibrary25cralawred [Underscorin
g supplied]
The partial motion for reconsideration of the above
order filed by Remedios and Manuela was denied in
the other assailed order of the RTC-Br. 6, dated June
10, 2011.26
Dissatisfied, Remedios and Manuela availed of the
special civil action of certiorari under Rule 65, and filed
a petition before the CA.
Action by the CA
The CA, however, in its October 5, 2011
Resolution,27 dismissed the same based on the
following infirmities: 1) there was no proper proof of
service of a copy of the petition on the respondents
which was sent by registered mail; 2) petitioners failed
to indicate on the petition the material date when the
motion for reconsideration was filed; 3) the copy of the
assailed order was not certified true and correct by the
officer having custody of the original copy; and 4) the
serial number of the commission of the notary public,
the province-city where he was commissioned, the
office address of the notary public and the roll of
attorney's number were not properly indicated on the
verification and certification of non-forum shopping.
Remedios and Manuela moved for reconsideration of
the assailed CA resolution, but to no avail, as the
appellate court denied the motion in its September 24,
2012 Resolution.
Hence, this petition before the Court, filed only by
Manuela as Remedios had also passed away, and
anchored on the following
GROUNDS
I.
THE HONORABLE COURT OF APPEALS
COMMITTED GROSS AND REVERSIBLE ERROR IN
THE APPLICATION OF LAW AND THE RULES
WARRANTING REVIEW WHEN IT MISAPPLIED
SECTION 13, RULE 13 OF THE RULES OF COURT
AND DECLARED THAT THERE WAS NO PROPER
PROOF OF SERVICE BY REGISTERED MAIL.
II.
THE HONORABLE COURT OF APPEALS
COMMITTED GROSS AND REVERSIBLE ERROR IN
THE APPLICATION OF LAW AND THE RULES
WARRANTING REVIEW WHEN IT MISAPPLIED
JURISPRUDENCE AND RULE 65 AND IT HELD
THAT PETITIONER MAYOR DID NOT COMPLY
WITH THE MATERIAL DATE RULE.
III.
THE HONORABLE COURT OF APPEALS
COMMITTED GROSS AND REVERSIBLE ERROR IN
THE APPLICATION OF LAW AND THE RULES
WARRANTING REVIEW WHEN IT DECLARED
THAT PETITIONER MAYOR FAILED TO COMPLY
WITH THE REQUIREMENT OF SECTION 1, RULE 65
FOR FAILING TO ATTACH CERTIFIED TRUE COPY
OF THE ORDER OF THE TRIAL COURT.
IV.
THE HONORABLE COURT OF APPEALS
COMMITTED GROSS AND REVERSIBLE ERROR IN
THE APPLICATION OF LAW AND THE RULES
WARRANTING REVIEW WHEN IT DECLARED
THAT PETITIONER MAYOR DID NOT COMPLY
WITH THE REQUIREMENT OF VERIFICATION AND
CERTIFICATION AGAINST FORUM SHOPPING.
V.
THE HONORABLE COURT OF APPEALS
COMMITTED GROSS AND REVERSIBLE ERROR IN
THE APPLICATION OF LAW AND THE RULES
WARRANTING REVIEW WHEN IT ALLOWED
TECHNICALITIES TO BE USED TO DEFEAT
SUBSTANTIAL RIGHT OF THE PARTIES.
VI.
PETITIONERS HAVE GOOD CAUSE AND A
MERITORIOUS CASE AGAINST HEREIN
RESPONDENTS AS PARAGRAPH 1(B) OF THE
DISPOSITIVE PORTION OF THE FIRST ASSAILED
ORDER SHOULD HAVE BEEN REVERSED
BECAUSE IT OVERTURNS THE DECISION OF THE
COURT OF APPEALS DATED 16 OCTOBER 2009
WHICH HAS LONG BECOME FINAL AND
EXECUTORY.28
Petitioner Manuela argued that:
1) There was actual compliance with Section 13, Rule
13 of the Rules of Court. The CA petition was
accompanied by a notarized affidavit of service and
filing of registered mail. At the time the petition was
filed, this was the best evidence of the service. The
other registry receipts for the other parties were
also attached to the petition. Further, the available
registry return card was furnished the CA in the
motion for reconsideration.29
2) The failure of the petition to comply with the rule on
a statement of material dates could be excused
because the dates were evident from the records.30
3) The petitioner went to the RTC of Tacloban to
secure certified true copies of the assailed orders.
Only the stamped name of the Clerk of Court,
however, appeared thereon, because the particular
265
 branch had no stamp pad which had the phrase for
certification. The branch did not even have a
typewriter in order to affix the phrase on the copies.
These inadequacies could not be attributed to the
petitioners.31
4) The lack of information pertaining to the notary
public in the verification and certification against
forum-shopping should not invalidate the same
because, again, it was not attributable to the
parties.32
5) Technicalities should never be used to defeat the
substantive rights of a party.33
In its January 23, 2013 Resolution34 the Court ordered
the respondents to file their respective comments.
Marty, in her Comment, insisted that the petitioner
failed to comply with the procedural requirements as
stated by the CA.35
In her Reply to Comment,36 petitioner Manuela clarified
that the affidavit of service was executed on August 31,
2011, which was after the petition was signed by the
lawyers and after it was verified by the petitioner
herself. After contesting Marty's arguments on the
alleged procedural infirmities of the petitions with the
CA and this Court, Manuela asserted that the final and
executory October 16, 2009 Decision of the CA already
held that Primrose had a personality separate and
distinct from the estate of decedent Rosario.
Meanwhile, in his Manifestation,37 dated May 29, 2013,
Edwin affirmed that he and Manuela decided to patch
up their differences and agreed to settle amicably.
Accordingly, he manifested that he was withdrawing
from the case pursuant to their agreement.
On June 18, 2014, Manuela filed her Motion for
Issuance of Temporary Restraining Order and Writ of
Preliminary Injunction38 on the ground that a flurry of
orders had been issued by the RTC-Br. 6 in the
implementation of the assailed January 20, 2011
Order, such as the Order,39 dated May 27, 2013,
wherein the probate court vaguely ordered "the
inventory of the exact extent of the 'decedent's estate.'"
Then another order was issued appointing an auditing
firm to conduct an inventory/audit of the Estate
including the rentals and earnings derived from the
lease of Mercury Drug and Chowking Restaurant, as
tenants of Primrose.40 According to petitioner Manuela,
although an inventory of the assets of the decedent
was proper, the probate court ordered an inventory of
the assets of Primrose, a separate and distinct entity.
Manuela asserts that it was clearly in error.
In her Supplement to the Motion for Issuance of
Temporary Restraining Order and Writ of Preliminary
Injunction,41 dated June 17, 2013, Manuela informed
the Court that the inventory and accounting of Primrose
would already commence on June 19, 2013.
Marty filed her Opposition,42 dated July 3, 2013, stating
that the petition of Manuela had been rendered moot
and academic as the probate court had declared her
as the sole heir of Rosario and appointed her
administrator of the estate. She argued that an
injunctive relief would work injustice to the estate
because of the total assimilation by petitioner of the
shareholdings of the decedent in Primrose and her
share in the corporation's income corresponding to her
shareholdings.
Finding that the requisites for preliminary injunctive
relief were present,43 the Court issued the TRO44 in
favor of Manuela on October 14, 2013. At the outset,
the Court was convinced that the rights of Primrose
sought to be protected by the grant of injunctive relief
were material and substantial and the TRO was issued
in order to prevent any irreparable damage to a
corporate entity that could arise from the conduct of an
accounting by the court-appointed inventory.
The Court's Ruling
The Court now resolves the subject case by the
issuance of a permanent injunction, as prayed for by
petitioner Manuela. This position is supported by law
and jurisprudence, as follows:
First. Artificial persons include (1) a collection or
succession of natural persons forming a corporation;
and (2) a collection of property to which the law
attributes the capacity of having rights and duties. This
class of artificial persons is recognized only to a limited
extent in our law. Example is the estate of a bankrupt
or deceased person.45 From this pronouncement, it
can be gleaned that the estate of the deceased person
is a juridical person separate and distinct from the
person of the decedent and any other corporation. This
status of an estate comes about by operation of law.
This is in consonance with the basic tenet under
corporation law that a corporation has a separate
personality distinct from its stockholders and from other
corporations to which it may be connected.46
Second. The doctrine of piercing the corporate veil has
no relevant application in this case. Under this doctrine,
the court looks at the corporation as a mere collection
of individuals or an aggregation of persons undertaking
business as a group, disregarding the separate
juridical personality of the corporation unifying the
group. Another formulation of this doctrine is that when
two business enterprises are owned, conducted and
controlled by the same parties, both law and equity will,
when necessary to protect the rights of third parties,
disregard the legal fiction that two corporations are
distinct entities and treat them as identical or as one
and the same.47 The purpose behind piercing a
corporation's identity is to remove the barrier between
the corporation and the persons comprising it to thwart
the fraudulent and illegal schemes of those who use
the corporate personality as a shield for undertaking
certain proscribed activities.48
Here, instead of holding the decedent's interest in the
corporation separately as a stockholder, the situation
was reversed. Instead, the probate court ordered the
lessees of the corporation to remit rentals to the
estate's administrator without taking note of the fact
that the decedent was not the absolute owner of
Primrose but only an owner of shares thereof. Mere
ownership by a single stockholder or by another
corporation of all or nearly all of the capital stocks of a
corporation is not of itself a sufficient reason for
disregarding the fiction of separate corporate
personalities.49 Moreover, to disregard the separate
juridical personality of a corporation, the wrongdoing
cannot be presumed, but must be clearly and
convincingly established.50
266

Third. A probate court is not without limits in the
determination of the scope of property covered in
probate proceedings. In a litany of cases, the Court had
defined the parameters by which a probate court may
extend its probing arms in the determination of the
question of title in probate proceedings. In Pastor, Jr.
vs. Court of Appeals,51 the Court explained that, as a
rule, the question of ownership was an extraneous
matter which the probate court could not resolve with
finality. Thus, for the purpose of determining whether a
certain property should, or should not, be included in
the inventory of estate properties, the probate court
may pass upon the title thereto, but such determination
is provisional, not conclusive, and is subject to the final
decision in a separate action to resolve title. It is a well-
settled rule that a probate court or one in charge of
proceedings, whether testate or intestate, cannot
adjudicate or determine title to properties claimed to be
part of the estate but which are equally claimed to
belong to outside parties. It can only determine
whether they should, or should not, be included in the
inventory or list of properties to be overseen by the
administrator. If there is no dispute, well and good; but
if there is, then the parties, the administrator and the
opposing parties have to resort to an ordinary action for
a final determination of the conflicting claims of title
because the probate court cannot do so.52
In this case, respondent Marty argues that the subject
properties and the parcel of land on which these were
erected should be included in the inventory of Rosario's
estate. More so, the arrears from the rental of these
properties were later on ordered to be remitted to the
administrator of the estate grounded on the allegation
that Rosario had no other properties other than her
interests in Primrose. To the Court's mind, this holding
of the probate court was in utter disregard of the
undisputed fact the subject land is registered under the
Torrens system in the name of Primrose, a third person
who may be prejudiced by the orders of the probate
court. In Valera vs. Inserto:53 the Court stated:
x x x, settled is the rule that a Court of First Instance
(now Regional Trial Court), acting as a probate court,
exercises but limited jurisdiction, and thus has no
power to take cognizance of and determine the issue
of title to property claimed by a third person adversely
to the decedent, unless the claimant and all the other
parties having legal interest in the property consent,
expressly or impliedly, to the submission of the
question to the probate court for adjudgment, or the
interests of third persons are not thereby prejudiced,
the reason for the exception being that the question of
whether or not a particular matter should be resolved
by the Court in the exercise of its general jurisdiction or
of its limited jurisdiction as a special court (e.g. probate,
land registration, etc.), is in reality not a jurisdictional
but in essence of procedural one, involving a mode of
practice which may be waived.
x x x x
x x x These considerations assume greater
cogency where, as here, the Torrens title to the
property is not in the decedent's names but in
others, a situation on which this Court has already
had occasion to rule.54 [Emphasis and underscoring
supplied]
Thus, the probate court should have recognized the
incontestability accorded to the Torrens title of
Primrose over Marty's arguments of possible
dissipation of properties. In fact, in the given setting,
even evidence purporting to support a claim of
ownership has to yield to the incontestability of a
Torrens title, until after the same has been set aside in
the manner indicated in the law itself. In other words,
the existence of a Torrens title may not be discounted
as a mere incident in special proceedings for the
settlement of the estate of deceased persons. Put
clearly, if a property covered by Torrens title is
involved, "the presumptive conclusiveness of such title
should be given due weight, and in the absence of
strong compelling evidence to the contrary, the holder
thereof should be considered as the owner of the
property in controversy until his title is nullified or
modified in an appropriate ordinary action, particularly,
when as in the case at bar, possession of the property
itself is in the persons named in the title."55
Additionally, Presidential Decree (P.D.) No.
152956 proscribes a collateral attack on a Torrens title:
Sec. 48. Certificate not subject to collateral attack. - A
certificate of title shall not be subject to collateral
attack. It cannot be altered, modified or cancelled
except in a direct proceeding in accordance with law.
In Cuizon vs. Ramolete,57 the property subject of the
controversy was duly registered under the Torrens
system. To this, Court categorically stated:
Having been apprised of the fact that the property in
question was in the possession of third parties and
more important, covered by a transfer certificate of title
issued in the name of such third parties, the
respondent court should have denied the motion of
the respondent administrator and excluded the
property in question from the inventory of the
property of the estate. It had no authority to deprive
such third persons of their possession and
ownership of the property.58 x x x [Emphasis and
underscoring supplied]
A perusal of the records of this case would show that
that no compelling evidence was ever presented to
substantiate the position of Marty that Rosario and
Primrose were one and the same, justifying the
inclusion of the latter's properties in the inventory of the
decedent's properties. This has remained a vacant
assertion. At most, what Rosario owned were shares
of stock in Primrose. In turn, this boldly underscores
the fact that Primrose is a separate and distinct
personality from the estate of the decedent. Inasmuch
as the real properties included in the inventory of the
estate of Rosario are in the possession of, and are
registered in the name of, Primrose, Marty's claims are
bereft of any logical reason and conclusion to pierce
the veil of corporate fiction.
Fourth. The probate court in this case has not
acquired jurisdiction over Primrose and its properties.
Piercing the veil of corporate entity applies to
determination of liability not of jurisdiction; it is basically
applied only to determine established liability. It is not
available to confer on the court a jurisdiction it has not
acquired, in the first place, over a party not impleaded
in a case.59 This is so because the doctrine of piercing
the veil of corporate fiction comes to play only during
the trial of the case after the court has already acquired
jurisdiction over the corporation. Hence, before this
doctrine can be even applied, based on the evidence
presented, it is imperative that the court must first have
jurisdiction over the corporation.60
Hence, a corporation not impleaded in a suit cannot be
subject to the court's process of piercing the veil of its
corporate fiction. Resultantly, any proceedings taken
267
 1Rollo,
against the corporation and its properties would pp. 80-82. Penned by Associate Justice
23
infringe on its right to due process. Eduardo B. Peralta, Jr. and concurred in by Associate Id. at 460-475.
Justices Pampio A. Abarintos and Gabriel T. Ingles of
24
In the case at bench, the probate court applied the the Eighteenth Division, Court of Appeals, Cebu City. As reported in the General Information Sheet for
doctrine of piercing the corporate veil ratiocinating that 2008.
2
Rosario had no other properties that comprise her Id. at 84-85. Penned by Executive Justice Pampio A.
25cralawred
estate other than her shares in Primrose. Although the Abarintos and concurred in by Associate Justices Rollo, pp. 540-541.
probate court's intention to protect the decedent's Gabriel T. Ingles and Carmelita Salandanan Manahan.
26
shares of stock in Primrose from dissipation is Id. at 113-114.
3
laudable, it is still.an error to order the corporation's Id. at 536-541.
27
tenants to remit their rental payments to the estate of Id. at 80-82.
4
Rosario. Id. at 113-114.
28 Id. at 58-59.
5
Considering the above disquisition, the Court holds Id. at 681-683.
29
that a permanent and final injunction is in order in Id. at 59-60.
6
accordance with Section 9, Rule 58 of the Rules of Id. at 116-118.
30
Court which provides that "[i]f after the trial of the action Id. at 62-64.
7
it appears that the applicant is entitled to have the act Id. at 51.
31
or acts complained of permanently enjoined, the court Id. at 64-66.
8
shall grant a final injunction perpetually restraining the Id. at 123.
32
party or person enjoined from the commission or Id. at 66-68.
9
continuance of the act or acts or confirming the Id. at 124-127.
33
preliminary mandatory injunction." Undoubtedly, Id. at 68-70.
10
Primrose stands to suffer an irreparable injury from the Id. at 133-140.
34
subject order of the probate court. Id. at 1265-1266.
11 Id. at 168-177.
WHEREFORE, the petition is GRANTED. The 35
That petitioners did not comply with the requirement
12
Temporary Restraining Order, dated June 14, 2013, is Entitled In the Matter of the Intestate Estate of Primo of the rules on service of its petition before the CA; That
hereby made PERMANENT, effective immediately. A. Villasin Avestruz Villasin. petitioners did not comply with the material date rule;
The Regional Trial Court, Branch 6, Tacloban City, That the petitioners failed to attach a certified true copy
is ENJOINED from enforcing and implementing its 13Rollo, pp. 144-146. of he assailed Order in their petition with the CA; That
January 20, 2011 and June 10, 2011 Orders, insofar the verification and certification of nonforum shopping
14
as the corporate properties of Primrose Development Id. at 147-151. attached to the petition with the CA is defective.
Corporation are concerned, to avert irreparable
15 36Rollo,
damage to a corporate entity, separate and distinct Id. at 277-284. pp. 1292-1301.
from the Estate of Rosario Guy-Juco Villasin Casilan.
16 37
Id. at 285-297. Id. at 1347-1349.
SO ORDERED. cralawlawlibrary
17 38
Id. at 304-324. Id. at 1322-1328
Carpio, (Chairperson), Velasco, Jr.,*Del Castillo,
and Leonen, JJ., concur. 18 39
Id. at 337-342. Id. at 1333-1337.

Endnotes: 19 Id. at 343-369. 40 Id. at 1338-1339.

20 41
Id. at 420-433. Id. at 1340-1342.
*Designated additional member per Raffle dated 21 Id. at 437-442. 42 Id. at 1360-1368.
September 17, 2014.
22 43
Id. at 456-459. The requisites for preliminary injunctive relief are: a)

268
 60
the invasion of right sought to be protected is material A. Agbayani, Commentaries and Jurisprudence on
and substantial; b) the right of the complainant is clear the Commercial Laws of the Philippines 18 (1991).
and unmistakable; and c) there is an urgent and
paramount necessity for the writ to prevent serious
damage.
44Rollo, pp. 1373-1376.
45 2 Rapalje & L. Law Dict. 954., as cited in Limjoco v.
Intestate Estate of Pedro O. Fragante, G.R. No. L-770,
April 27, 1948.
46Concept Builder's Inc. v. NLRC, 326 Phil. 955, 964
(1996).
47Pantranco Employees Association (PEA-PTGWO) v.
National Labor Relations Commission, citing General
Credit Corporation v. Alsons Development and
Investment Corporation, 542 Phil. 219, 231 (2007).
48Francisco Motors Corporation v. Court of Appeals,
368 Phil. 374, 385 (1999).
49Traders Royal Bank v. Court of Appeals, 336 Phil. 15,
29 (1997).
50
Mataguina Integrated Wood Products Inc. v. Court of
Appeals, 331 Phil. 795, 814 (1996).
51 207 Phil. 758 (1983).
52Morales v. CFI of Cavite, 230 Phil. 456, 465 (1986).
53 233 Phil. 552 (1987).
54 Id. at 562-563.
55Bolisay v. Alcid, 174 Phil. 463, 470 (1978).
56 The Property Registration Decree.
57 214 Phil. 436 (1984).
58 Id. at 442.
59Kukan International Corporation v. Hon. Amor Reyes,
646 Phil. 210, 234 (2010).

269