The Bar Subjects

A. Rule 138 , Secs. 9 and 14 of the rules of the Court

Section 9. Examination; subjects. — Applicants, not otherwise provided for in sections 3 and 4 of
this rule, shall be subjected to examinations in the following subjects: Civil Law; Labor and Social
Legislation; Mercantile Law; Criminal Law; Political Law (Constitutional Law, Public Corporations,
and Public Officers); International Law (Private and Public); Taxation; Remedial Law (Civil
Procedure, Criminal Procedure, and Evidence); Legal Ethics and Practical Exercises (in Pleadings
and Conveyancing).

Section 14. Passing average. — In order that a candidate may be deemed to have passed his
examinations successfully, he must have obtained a general average of 75 per cent in all subjects,
without falling below 50 per cent in any subjects. In determining the average, the subjects in the
examination shall be given the following relative weights: Civil Law, 15 per cent; Labor and Social
Legislation, 10 per cent; Mercantile Law, 15 per cent; Criminal Law; 10 per cent: Political and
International Law, 15 per cent; Taxation, 10 per cent; Remedial Law, 20 per cent; Legal Ethics and
Practical Exercises, 5 per cent.

B. Political Law and Public International Law

Political Law- branch of public law that deals with organization and operation of the
governmental organs of the State and defines the relations of the state with the inhabitants of its
territory. Political law embraces constitutional law. Law of public corporations, administrative
law including the law on public officers and election.

Example:

Avelino vs. Cuenco

G.r. No. L-2821, March 4, 1940

Vicente J. Francisco for petitioner.

Office of the Solicitor General Felix Angelo Bautista, Ramon Diokno and Lorenzo M. Tañada for
respondent.
Teehankee, Fernando, Sunico & Rodrigo; Vera, Montesines & Navarro; Felixberto M. Serrano and
Vicente del Rosario as amici curiae.

RESOLUTION

In G.R. No. L-2821, Avelino vs. Cuenco, the Court by a vote of six justices against four resolved to
deny the petition.

Without prejudice to the promulgation of a more extended opinion, this is now written briefly to explain
the principal grounds for the denial.
The Court believes the following essential facts have been established:

In the session of the Senate of February 18, 1949, Senator Lorenzo M. Tañadare quested that his
right to speak on the next session day, February 21, 1949, to formulate charges against the then
Senate President Jose Avelino be reserved. His request was approved.

On February 21, 1949, hours before the opening of the session Senator Tañada and Senator Tañada
and Senator Prospero Sanidad filed with the Secretary of the Senate a resolution enumerating charges
against the then Senate President and ordering the investigation thereof.

Although a sufficient number of senators to constitute a quorum were at the Senate session hall at the
appointed time (10:00 A.M.), and the petitioner was already in his office, said petitioner delayed his
appearance at the session hall until about 11:35 A.M. When he finally ascended the rostrum, he did
not immediately open the session, but instead requested from the Secretary a copy of the resolution
submitted by Senators Tañada and Sanidad and in the presence of the public he read slowly and
carefully said resolution, after which he called and conferred with his colleagues Senator Francisco
and Tirona.

Shortly before 12:00 noon, due to the session be opened, the petitioner finally called the meeting to
order. Except Senator Sotto who was confined in a hospital and Senator Confesor who is in the United
States, all the Senator were present.

Senator Sanidad, following a long established practice, moved that the roll call be dispensed with, but
Senator Tirona opposed said motion, obviously in pursuance of a premeditated plan of petitioner and
his partisans to make use of dilatory tactics to prevent Senator Tañada from delivering his privilege
speech. The roll was called.

Senator Sanidad next moved, as is the usual practice, to dispense with the reading of the minutes, but
this motion was likewise opposed by Senator Tirona and David, evidently, again, in pursuance of the
above-mentioned conspiracy.

Before and after the roll call and before and after the reading of the minutes, Senator Tañada
repeatedly stood up to claim his right to deliver his one-hour privilege speech but the petitioner, then
presiding, continuosly ignored him; and when after the reading of the minutes, Senator Tañada instead
on being recognized by the Chair, the petitioner announced that he would order the arrest of any
senator who would speak without being previously recognized by him, but all the while, tolerating the
actions of his follower, Senator Tirona, who was continuously shouting at Senator Sanidad "Out of
order!" everytime the latter would ask for recognition of Senator Tañada.

At this juncture, some disorderly conduct broke out in the Senate gallery, as if by pre-arrangement. At
about this same time Senator Pablo Angeles David, one of the petitioner's followers, was recognized
by petitioner, and he moved for adjournment of session, evidently, again, in pursuance of the above-
mentioned conspiracy to muzzle Senator Tañada.
Senator Sanidad registered his opposition to the adjournment of the session and this opposition was
seconded by herein respondent who moved that the motion of adjournment be submitted to a vote.
Another commotion ensued.

Senator David reiterated his motion for adjournment and herein respondent also reiterated his
opposition to the adjournment and again moved that the motion of Senator David be submitted to a
vote.

Suddenly, the petitioner banged the gavel and abandoning the Chair hurriedly walked out of the
session hall followed by Senator David, Tirona, Francisco, Torres, Magalona and Clarin, while the rest
of the senators remained. Whereupon Senator Melencio Arranz, Senate President Pro-tempore, urged
by those senators present took the Chair and proceeded with the session.

Senator Cabili stood up, and asked that it be made of record — it was so made — that the deliberate
abandonment of the Chair by the petitioner, made it incumbent upon Senate President Pro-tempore
Arranz and the remaining members of the Senate to continue the session in order not to paralyze the
functions of the Senate.

Senate President Pro-tempore Arranz then suggested that respondent be designated to preside over
the session which suggestion was carried unanimously. the respondent thereupon took the Chair.

Upon motion of Senator Arranz, which was approved Gregorio Abad was appointedActing Secretary,
because the Assistance Secretary, who was then acting as Secretary, had followed the petitioner
when the latter abandoned the session.

Senator Tañada, after being recognized by the Chair, was then finally able to deliver his privilege
speech. Thereafter Senator Sanidad read aloud the complete text of said Resolution (No. 68), and
submitted his motion for approval thereof and the same was unanimously approved.

With Senate President Pro-tempore Arranz again occupying the Chair, after the respondent had
yielded it to him, Senator Sanidad introduced Resolution No. 67, entitled "Resolution declaring vacant
the position of the President of the Senate and designated the Honorable Mariano Jesus Cuenco
Acting President of the Senate." Put to a vote, the said resolution was unanimously approved.

Senator Cuenco took the oath.

The next day the President of the Philippines recognized the respondent as acting president of the
Philippines Senate.

By his petition in this quo warranto proceeding petitioners asked the Court to declare him the rightful
President of the Philippines senate and oust respondent.

The Court has examined all principal angles of the controversy and believes that these are the crucial
points:

a. Does the Court have jurisdiction over the subject-matter?

b. If it is has, were resolution Nos. 68 and 67 validly approved?

c. Should the petition be granted?

To the first question, the answer is in the negative, in view of the separation of powers, the political
nature of the controversy (Alejandrino vs. Quezon, 46 Phil., 83; Vera vs. Avelino, 77 Phil., 192;
Mabanag vs. Lopez Vito, 78 Phil., 1) and the constitutional grant to the Senate of the power to elect
its own president, which power should not be interfered with, nor taken over, by the judiciary. We
refused to take cognizance of the Vera case even if the rights of the electors of the suspended senators
were alleged affected without any immediate remedy. A fortiori we should abstain in this case because
the selection of the presiding officer affect only the Senators themselves who are at liberty at any time
to choose their officers, change or reinstate them. Anyway, if, as the petition must imply to be
acceptable, the majority of the Senators want petitioner to preside, his remedy lies in the Senate
Session Hall — not in the Supreme Court.

The Court will not sally into the legitimate domain of the Senate on the plea that our refusal to intercede
might lead into a crisis, even a resolution. No state of things has been proved that might change the
temper of the Filipino people as a peaceful and law-abiding citizens. And we should not allow ourselves
to be stampeded into a rash action inconsistent with the calm that should characterized judicial
deliberations.

The precedent of Werts vs. Roger does not apply, because among other reasons, the situation is not
where two sets of senators have constituted themselves into two senates actually functioning as such,
(as in said Werts case), there being no question that there is presently one Philippines Senate only.
To their credit be it recorded that petitioner and his partisans have not erected themselves into another
Senate. The petitioner's claim is merely that respondent has not been duly elected in his place in the
same one Philippines Senate.

It is furthermore believed that the recognition accorded by the Chief Executive to the respondent
makes it advisable, more than ever, to adopt the hands-off policy wisely enunciated by this Court in
matters of similar nature.

The second question depends upon these sub-questions. (1) Was the session of the so-called rump
Senate a continuation of the session validly assembled with twenty two Senators in the morning of
February 21, 1949?; (2) Was there a quorum in that session? Mr. Justice Montemayor and Mr. Justice
Reyes deem it useless, for the present to pass on these questions once it is held, as they do, that the
Court has no jurisdiction over the case. What follows is the opinion of the other four on those four on
those sub-questions.

Supposing that the Court has jurisdiction, there is unanimity in the view that the session under Senator
Arranz was a continuation of the morning session and that a minority of ten senators may not, by
leaving the Hall, prevent the other twelve senators from passing a resolution that met with their
unanimous endorsement. The answer might be different had the resolution been approved only by ten
or less.
If the rump session was not a continuation of the morning session, was it validly constituted? In other
words, was there the majority required by the Constitution for the transaction of the business of the
Senate? Justice Paras, Feria, Pablo and Bengzon say there was, firstly because the minute say so,
secondly, because at the beginning of such session there were at least fourteen senators including
Senators Pendatun and Lopez, and thirdly because in view of the absence from the country of Senator
Tomas Confesor twelve senators constitute a majority of the Senate of twelve three senators. When
the Constitution declares that a majority of "each House" shall constitute a quorum, "the House: does
not mean "all" the members. Even a majority of all the members constitute "the House". (Missouri Pac.
vs. Kansas, 63 Law ed. [U. S.], p. 239). There is a difference between a majority of "the House", the
latter requiring less number than the first. Therefore an absolute majority (12) of all the members of
the Senate less one (23), constitutes constitutional majority of the Senate for the purpose of a quorum.
Mr. Justice Pablo believes furthermore than even if the twelve did not constitute a quorum, they could
have ordered the arrest of one, at least, of the absent members; if one had been so arrested, there
would be no doubt Quorum then, and Senator Cuenco would have been elected just the same
inasmuch as there would be eleven for Cuenco, one against and one abstained.

In fine, all the four justice agree that the Court being confronted with the practical situation that of the
twenty three senators who may participate in the Senate deliberations in the days immediately after
this decision, twelve senators will support Senator Cuenco and, at most, eleven will side with Senator
Avelino, it would be most injudicious to declare the latter as the rightful President of the Senate, that
office being essentially one that depends exclusively upon the will of the majority of the senators, the
rule of the Senate about tenure of the President of that body being amenable at any time by that
majority. And at any session hereafter held with thirteen or more senators, in order to avoid all
controversy arising from the divergence of opinion here about quorum and for the benefit of all
concerned,the said twelve senators who approved the resolutions herein involved could ratify all their
acts and thereby place them beyond the shadow of a doubt.

As already stated, the six justices hereinabove mentioned voted to dismiss the petition. Without costs.

Public International Law – body of principles, concepts and customs that govern the
relationship of sovereign states and entities with one another under the backdrop of the
international community. Mostly composed of international agreements and treaties, some
practices are rooted in tradition, customs and generally accepted international law.

Macariola v. Asuncion
199 Phil 295
Already digested so look for hard copy!

C. Labor Law and Social Legislation

Labor Law- SECTION 3. The State shall afford full protection to labor, local and overseas,
organized and unorganized, and promote full employment and equality of employment
opportunities for all.
It shall guarantee the rights of all workers to self-organization, collective bargaining and
negotiations, and peaceful concerted activities, including the right to strike in accordance with
law. They shall be entitled to security of tenure, humane conditions of work, and a living wage.
They shall also participate in policy and decision-making processes affecting their rights and
benefits as may be provided by law.

The State shall promote the principle of shared responsibility between workers and employers
and the preferential use of voluntary modes in settling disputes, including conciliation, and shall
enforce their mutual compliance therewith to foster industrial peace.

The State shall regulate the relations between workers and employers, recognizing the right of
labor to its just share in the fruits of production and the right of enterprises to reasonable returns
on investments, and to expansion and growth.

Social Legislation- In Calalang v Williams stated that “Social justice, therefore, must be
founded on the recognition of the necessity of interdependence among divers and diverse units of
a society and of the protection that should be equally and evenly extended to all groups as a
combined force in our social and economic life, consistent with the fundamental and paramount
objective of the state of promoting the health, comfort, and quiet of all persons, and of bringing
about "the greatest good to the greatest number."

D. Civil Law
Civil Law- is a collection of laws which regulates the private relations of the members of civil
society, determining their respective rights and obligations, with reference to persons, things and
civil acts. It governs the relations between private parties from status, rights and duties to
property ownership, contractual relations and liability for torts.

Ibanez v Quinones
G.r. No. 175822, October 23,2013

DECISION
PERALTA, J.:
Assailed in this petition for review on certiorari under Rule 45 of the ; Rules of Court are the
Court of Appeals Decision1 dated August 3, 2006 and Resolution2 dated November 14, 2006 in
CA-G.R. CV No. 80309. The assailed decision reversed and set aside the June 20, 2003
Decision3 of the Regional Trial Court of Cebu City (RTC), Branch 58, in Civil Case No. CEB-
26984; while the assailed resolution denied the motion for reconsideration filed by petitioner
Michelle Ybañez (Ybañez).
The facts of the case, as culled from the records, are as follows:
On July 25, 2001, respondent Shirley G. Quiñones, a Reservation Ticketing Agent of Cebu
Pacific Air in Lapu Lapu City, went inside the Guess USA Boutique at the second floor of
Robinson’s Department Store (Robinson’s) in Cebu City. She fitted four items: two jeans, a
blouse and a shorts, then decided to purchase the black jeans worth ₱2,098.00.4 Respondent
allegedly paid to the cashier evidenced by a receipt5 issued by the store.6
While she was walking through the skywalk connecting Robinson’s and Mercury Drug Store
(Mercury) where she was heading next, a Guess employee approached and informed her that she
failed to pay the item she got. She, however, insisted that she paid and showed the employee the
receipt issued in her favor.7 She then suggested that they talk about it at the Cebu Pacific Office
located at the basement of the mall. She first went to Mercury then met the Guess employees as
agreed upon.8
When she arrived at the Cebu Pacific Office, the Guess employees allegedly subjected her to
humiliation in front of the clients of Cebu Pacific and repeatedly demanded payment for the
black jeans.9 They supposedly even searched her wallet to check how much money she had,
followed by another argument. Respondent, thereafter, went home.10
On the same day, the Guess employees allegedly gave a letter to the Director of Cebu Pacific Air
narrating the incident, but the latter refused to receive it as it did not concern the office and the
same took place while respondent was off duty.11 Another letter was allegedly prepared and was
supposed to be sent to the Cebu Pacific Office in Robinson’s, but the latter again refused to
receive it.12 Respondent also claimed that the Human Resource Department (HRD) of
Robinson’s was furnished said letter and the latter in fact conducted an investigation for purposes
of canceling respondent’s Robinson’s credit card. Respondent further claimed that she was not
given a copy of said damaging letter.13 With the above experience, respondent claimed to have
suffered physical anxiety, sleepless nights, mental anguish, fright, serious apprehension,
besmirched reputation, moral shock and social humiliation.14 She thus filed the Complaint for
Damages15 before the RTC against petitioners California Clothing, Inc. (California Clothing),
Excelsis Villagonzalo (Villagonzalo), Imelda Hawayon (Hawayon) and Ybañez. She demanded
the payment of moral, nominal, and exemplary damages, plus attorney’s fees and litigation
expenses.16
In their Answer,17 petitioners and the other defendants admitted the issuance of the receipt of
payment. They claimed, however, that instead of the cashier (Hawayon) issuing the official
receipt, it was the invoicer (Villagonzalo) who did it manually. They explained that there was
miscommunication between the employees at that time because prior to the issuance of the
receipt, Villagonzalo asked Hawayon " Ok na ?," and the latter replied " Ok na ," which the
former believed to mean that the item has already been paid.18 Realizing the mistake,
Villagonzalo rushed outside to look for respondent and when he saw the latter, he invited her to
go back to the shop to make clarifications as to whether or not payment was indeed made.
Instead, however, of going back to the shop, respondent suggested that they meet at the Cebu
Pacific Office. Villagonzalo, Hawayon and Ybañez thus went to the agreed venue where they
talked to respondent.19 They pointed out that it appeared in their conversation that respondent
could not recall whom she gave the payment.20 They emphasized that they were gentle and polite
in talking to respondent and it was the latter who was arrogant in answering their questions.21 As
counterclaim, petitioners and the other defendants sought the payment of moral and exemplary
damages, plus attorney’s fees and litigation expenses.22
On June 20, 2003, the RTC rendered a Decision dismissing both the complaint and counterclaim
of the parties. From the evidence presented, the trial court concluded that the petitioners and the
other defendants believed in good faith that respondent failed to make payment. Considering that
no motive to fabricate a lie could be attributed to the Guess employees, the court held that when
they demanded payment from respondent, they merely exercised a right under the honest belief
that no payment was made. The RTC likewise did not find it damaging for respondent when the
confrontation took place in front of Cebu Pacific clients, because it was respondent herself who
put herself in that situation by choosing the venue for discussion. As to the letter sent to Cebu
Pacific Air, the trial court also did not take it against the Guess employees, because they merely
asked for assistance and not to embarrass or humiliate respondent. In other words, the RTC
found no evidence to prove bad faith on the part of the Guess employees to warrant the award of
damages.23
On appeal, the CA reversed and set aside the RTC decision, the dispositive portion of which
reads:
WHEREFORE, the instant appeal is GRANTED. The decision of the Regional Trial Court of
Cebu City, Branch 58, in Civil Case No. CEB-26984 (for: Damages) is hereby REVERSED and
SET ASIDE. Defendants Michelle Ybañez and California Clothing, Inc. are hereby ordered to
pay plaintiff-appellant Shirley G. Quiñones jointly and solidarily moral damages in the amount
of Fifty Thousand Pesos (₱50,000.00) and attorney’s fees in the amount of Twenty Thousand
Pesos (₱20,000.00).
SO ORDERED.24
While agreeing with the trial court that the Guess employees were in good faith when they
confronted respondent inside the Cebu Pacific Office about the alleged non-payment, the CA,
however, found preponderance of evidence showing that they acted in bad faith in sending the
demand letter to respondent’s employer. It found respondent’s possession of both the official
receipt and the subject black jeans as evidence of payment.25 Contrary to the findings of the
RTC, the CA opined that the letter addressed to Cebu Pacific’s director was sent to respondent’s
employer not merely to ask for assistance for the collection of the disputed payment but to
subject her to ridicule, humiliation and similar injury such that she would be pressured to pay.26
Considering that Guess already started its investigation on the incident, there was a taint of bad
faith and malice when it dragged respondent’s employer who was not privy to the transaction.
This is especially true in this case since the purported letter contained not only a narrative of the
incident but accusations as to the alleged acts of respondent in trying to evade payment.27 The
appellate court thus held that petitioners are guilty of abuse of right entitling respondent to
collect moral damages and attorney’s fees. Petitioner California Clothing Inc. was made liable
for its failure to exercise extraordinary diligence in the hiring and selection of its employees;
while Ybañez’s liability stemmed from her act of signing the demand letter sent to respondent’s
employer. In view of Hawayon and Villagonzalo’s good faith, however, they were exonerated
from liability.28
Ybañez moved for the reconsideration29 of the aforesaid decision, but the same was denied in the
assailed November 14, 2006 CA Resolution.
Petitioners now come before the Court in this petition for review on certiorari under Rule 45 of
the Rules of Court based on the following grounds:
I.
THE HONORABLE COURT OF APPEALS ERRED IN FINDING THAT THE LETTER
SENT TO THE CEBU PACIFIC OFFICE WAS MADE TO SUBJECT HEREIN
RESPONDENT TO RIDICULE, HUMILIATION AND SIMILAR INJURY.
II.
THE HONORABLE COURT OF APPEALS ERRED IN AWARDING MORAL DAMAGES
AND ATTORNEY’S FEES.30
The petition is without merit.
Respondent’s complaint against petitioners stemmed from the principle of abuse of rights
provided for in the Civil Code on the chapter of human relations. Respondent cried foul when
petitioners allegedly embarrassed her when they insisted that she did not pay for the black jeans
she purchased from their shop despite the evidence of payment which is the official receipt
issued by the shop. The issuance of the receipt notwithstanding, petitioners had the right to verify
from respondent whether she indeed made payment if they had reason to believe that she did not.
However, the exercise of such right is not without limitations. Any abuse in the exercise of such
right and in the performance of duty causing damage or injury to another is actionable under the
Civil Code. The Court’s pronouncement in Carpio v. Valmonte31 is noteworthy:
In the sphere of our law on human relations, the victim of a wrongful act or omission, whether
done willfully or negligently, is not left without any remedy or recourse to obtain relief for the
damage or injury he sustained. Incorporated into our civil law are not only principles of equity
but also universal moral precepts which are designed to indicate certain norms that spring from
the fountain of good conscience and which are meant to serve as guides for human conduct. First
of these fundamental precepts is the principle commonly known as "abuse of rights" under
Article 19 of the Civil Code. It 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."x x x32 The elements of abuse of rights are as follows: (1) there is a legal right or
duty; (2) which is exercised in bad faith; (3) for the sole intent of prejudicing or injuring
another.33
In this case, petitioners claimed that there was a miscommunication between the cashier and the
invoicer leading to the erroneous issuance of the receipt to respondent. When they realized the
mistake, they made a cash count and discovered that the amount which is equivalent to the price
of the black jeans was missing. They, thus, concluded that it was respondent who failed to make
such payment. It was, therefore, within their right to verify from respondent whether she indeed
paid or not and collect from her if she did not. However, the question now is whether such right
was exercised in good faith or they went overboard giving respondent a cause of action against
them.
Under the abuse of rights principle found in Article 19 of the Civil Code, a person must, in the
exercise of legal right or duty, act in good faith. He would be liable if he instead acted in bad
faith, with intent to prejudice another.34 Good faith refers to the state of 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.35 Malice or bad faith, on the
other hand, implies a conscious and intentional design to do a wrongful act for a dishonest
purpose or moral obliquity.36
Initially, there was nothing wrong with petitioners asking respondent whether she paid or not.
The Guess employees were able to talk to respondent at the Cebu Pacific Office. The
confrontation started well, but it eventually turned sour when voices were raised by both parties.
As aptly held by both the RTC and the CA, such was the natural consequence of two parties with
conflicting views insisting on their respective beliefs. Considering, however, that respondent was
in possession of the item purchased from the shop, together with the official receipt of payment
issued by petitioners, the latter cannot insist that no such payment was made on the basis of a
mere speculation. Their claim should have been proven by substantial evidence in the proper
forum.
It is evident from the circumstances of the case that petitioners went overboard and tried to force
respondent to pay the amount they were demanding. In the guise of asking for assistance,
petitioners even sent a demand letter to respondent’s employer not only informing it of the
incident but obviously imputing bad acts on the part of respondent.1âwphi1 Petitioners claimed
that after receiving the receipt of payment and the item purchased, respondent "was noted to
hurriedly left (sic) the store." They also accused respondent that she was not completely being
honest when she was asked about the circumstances of payment, thus:
x x x After receiving the OR and the item, Ms. Gutierrez was noted to hurriedly left (sic) the
store. x x x
When I asked her about to whom she gave the money, she gave out a blank expression and told
me, "I can’t remember." Then I asked her how much money she gave, she answered, "₱2,100; 2
pcs 1,000 and 1 pc 100 bill." Then I told her that that would (sic) impossible since we have no
such denomination in our cash fund at that moment. Finally, I asked her if how much change and
if she received change from the cashier, she then answered, "I don’t remember." After asking
these simple questions, I am very certain that she is not completely being honest about this. In
fact, we invited her to come to our boutique to clear these matters but she vehemently refused
saying that she’s in a hurry and very busy.37
Clearly, these statements are outrightly accusatory. Petitioners accused respondent that not only
did she fail to pay for the jeans she purchased but that she deliberately took the same without
paying for it and later hurriedly left the shop to evade payment. These accusations were made
despite the issuance of the receipt of payment and the release of the item purchased. There was,
likewise, no showing that respondent had the intention to evade payment. Contrary to
petitioners’ claim, respondent was not in a rush in leaving the shop or the mall. This is evidenced
by the fact that the Guess employees did not have a hard time looking for her when they realized
the supposed non-payment.
It can be inferred from the foregoing that in sending the demand letter to respondent’s employer,
petitioners intended not only to ask for assistance in collecting the disputed amount but to tarnish
respondent’s reputation in the eyes of her employer. To malign respondent without substantial
evidence and despite the latter’s possession of enough evidence in her favor, is clearly
impermissible. A person should not use his right unjustly or contrary to honesty and good faith,
otherwise, he opens himself to liability.38
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.39 In this case, petitioners obviously abused their rights.
Complementing the principle of abuse of rights are the provisions of Articles 20 and 2 of the
Civil Code which read:40
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 or good customs, or public policy shall compensate the latter for the damage.
In view of the foregoing, respondent is entitled to an award of moral damages and attorney s
fees. Moral damages may be awarded whenever the defendant s wrongful act or omission is the
proximate cause of the plaintiffs physical suffering, mental anguish, fright, serious anxiety,
besmirched reputation, wounded feelings, moral shock, social humiliation and similar injury in
the cases specified or analogous to those provided in Article 2219 of the Civil Code.41 Moral
damages are not a bonanza. They are given to ease the defendant s grief and suffering. They
should, thus, reasonably approximate the extent of hurt caused and the gravity of the wrong
done.42 They are awarded not to enrich the complainant but to enable the latter to obtain means,
diversions, or amusements that will serve to alleviate the moral suffering he has undergone.43 We
find that the amount of ₱50,000.00 as moral damages awarded by the CA is reasonable under the
circumstances. Considering that respondent was compelled to litigate to protect her interest,
attorney s fees in the amount of of₱20,000.00 is likewise just and proper.
WHEREFORE, premises considered, the petition is DENIED for lack of merit. The Court of
Appeals Decision dated August 3, 2006 and Resolution dated November 14, 2006 in CA-G.R.
CV No. 80309, are AFFIRMED.
SO ORDERED.

E. Taxation Law
Taxation- is the power by which the sovereign raises revenue to defray the necessary expenses
of the government. Taxes are the enforced proportional contribution from persons and property
levied by the State by virtue of its sovereign power for public purposes.
(R.A 8424) Section 21. Sources of Revenue. - The following taxes, fees and charges are deemed
to be national internal revenue taxes:
(a) Income tax;
(b) Estate and donor's taxes;
(c) Value-added tax;
(d) Other percentage taxes;
(e) Excise taxes;
(f) Documentary stamp taxes; and
(g) Such other taxes as are or hereafter may be imposed and collected by the Bureau of Internal
Revenue.

F. Mercantile Law
Mercantile Law- covers a variety of areas such as corporation law, negotiable instruments law,
insurance law, transportation law, banking law and other allied laws. All of these laws are
directly related to commercial activities of man wherein there arise juridical relations from such
activities.

Good Earth Emporium Inc. v. CA

G.r. no. 82797, February 27,1991

PARAS, J.:
This is a petition for review on certiorari of the December 29, 1987 decision * of the Court of
Appeals in CA-G.R. No. 11960 entitled "ROCES-REYES REALTY, INC. vs. HONORABLE
JUDGE REGIONAL TRIAL COURT OF MANILA, BRANCH 44, GOOD EARTH
EMPORIUM, INC. and LIM KA PING" reversing the decision of respondent Judge ** of the
Regional Trial Court of Manila, Branch 44 in Civil Case No. 85-30484, which reversed the
resolution of the Metropolitan Trial Court Of Manila, Branch 28 in Civil Case No. 09639, ***
denying herein petitioners' motion to quash the alias writ of execution issued against them.
As gathered from the records, the antecedent facts of this case, are as follows:
A Lease Contract, dated October 16, 1981, was entered into by and between ROCES-REYES
REALTY, INC., as lessor, and GOOD EARTH EMPORIUM, INC., as lessee, for a term of three
years beginning November 1, 1981 and ending October 31, 1984 at a monthly rental of
P65,000.00 (Rollo, p. 32; Annex "C" of Petition). The building which was the subject of the
contract of lease is a five-storey building located at the corner of Rizal Avenue and Bustos Street
in Sta. Cruz, Manila.
From March 1983, up to the time the complaint was filed, the lessee had defaulted in the
payment of rentals, as a consequence of which, private respondent ROCES-REYES REALTY,
INC., (hereinafter designated as ROCES for brevity) filed on October 14, 1984, an ejectment
case (Unlawful Detainer) against herein petitioners, GOOD EARTH EMPORIUM, INC. and
LIM KA PING, hereinafter designated as GEE, (Rollo, p. 21; Annex "B" of the Petition). After
the latter had tendered their responsive pleading, the lower court (MTC, Manila) on motion of
Roces rendered judgment on the pleadings dated April 17, 1984, the dispositive portion of which
states:
Judgment is hereby rendered ordering defendants (herein petitioners) and all persons claiming
title under him to vacate the premises and surrender the same to the plaintiffs (herein
respondents); ordering the defendants to pay the plaintiffs the rental of P65,000.00 a month
beginning March 1983 up to the time defendants actually vacate the premises and deliver
possession to the plaintiff; to pay attorney's fees in the amount of P5,000.00 and to pay the costs
of this suit. (Rollo, p. 111; Memorandum of Respondents)
On May 16, 1984, Roces filed a motion for execution which was opposed by GEE on May 28,
1984 simultaneous with the latter's filing of a Notice of Appeal (Rollo, p. 112, Ibid.). On June 13,
1984, the trial court resolved such motion ruling:
After considering the motion for the issuance of a writ of execution filed by counsel for the
plaintiff (herein respondents) and the opposition filed in relation thereto and finding that the
defendant failed to file the necessary supersedeas bond, this court resolved to grant the same for
being meritorious. (Rollo, p. 112)
On June 14, 1984, a writ of execution was issued by the lower court. Meanwhile, the appeal was
assigned to the Regional Trial Court (Manila) Branch XLVI. However, on August 15, 1984,
GEE thru counsel filed with the Regional Trial Court of Manila, a motion to withdraw appeal
citing as reason that they are satisfied with the decision of the Metropolitan Trial Court of
Manila, Branch XXVIII, which said court granted in its Order of August 27, 1984 and the
records were remanded to the trial court (Rollo, p. 32; CA Decision). Upon an ex-parte Motion
of ROCES, the trial court issued an Alias Writ of Execution dated February 25, 1985 (Rollo, p.
104; Annex "D" of Petitioner's Memorandum), which was implemented on February 27, 1985.
GEE thru counsel filed a motion to quash the writ of execution and notice of levy and an urgent
Ex-parte Supplemental Motion for the issuance of a restraining order, on March 7, and 20, 1985,
respectively. On March 21, 1985, the lower court issued a restraining order to the sheriff to hold
the execution of the judgment pending hearing on the motion to quash the writ of execution
(Rollo, p. 22; RTC Decision). While said motion was pending resolution, GEE filed a Petition
for Relief from judgment before another court, Regional Trial Court of Manila, Branch IX,
which petition was docketed as Civil Case No. 80-30019, but the petition was dismissed and the
injunctive writ issued in connection therewith set aside. Both parties appealed to the Court of
Appeals; GEE on the order of dismissal and Roces on denial of his motion for indemnity, both
docketed as CA-G.R. No. 15873-CV. Going back to the original case, the Metropolitan Trial
Court after hearing and disposing some other incidents, promulgated the questioned Resolution,
dated April 8, 1985, the dispositive portion of which reads as follows:
Premises considered, the motion to quash the writ is hereby denied for lack of merit.
The restraining orders issued on March 11 and 23, 1985 are hereby recalled, lifted and set aside.
(Rollo, p. 20, MTC Decision)
GEE appealed and by coincidence. was raffled to the same Court, RTC Branch IX. Roces moved
to dismiss the appeal but the Court denied the motion. On certiorari, the Court of Appeals
dismissed Roces' petition and remanded the case to the RTC. Meantime, Branch IX became
vacant and the case was re-raffled to Branch XLIV.
On April 6, 1987, the Regional Trial Court of Manila, finding that the amount of P1 million
evidenced by Exhibit "I" and another P1 million evidenced by the pacto de retro sale instrument
(Exhibit "2") were in full satisfaction of the judgment obligation, reversed the decision of the
Municipal Trial Court, the dispositive portion of which reads:
Premises considered, judgment is hereby rendered reversing the Resolution appealed from
quashing the writ of execution and ordering the cancellation of the notice of levy and declaring
the judgment debt as having been fully paid and/or Liquidated. (Rollo, p. 29).
On further appeal, the Court of Appeals reversed the decision of the Regional Trial Court and
reinstated the Resolution of the Metropolitan Trial Court of Manila, the dispositive portion of
which is as follows:
WHEREFORE, the judgment appealed from is hereby REVERSED and the Resolution dated
April 8, 1985, of the Metropolitan Trial Court of Manila Branch XXXIII is hereby
REINSTATED. No pronouncement as to costs. (Rollo, p. 40).
GEE's Motion for Reconsideration of April 5, 1988 was denied (Rollo, p. 43). Hence, this
petition.
The main issue in this case is whether or not there was full satisfaction of the judgment debt in
favor of respondent corporation which would justify the quashing of the Writ of Execution.
A careful study of the common exhibits (Exhibits 1/A and 2/B) shows that nowhere in any of
said exhibits was there any writing alluding to or referring to any settlement between the parties
of petitioners' judgment obligation (Rollo, pp. 45-48).
Moreover, there is no indication in the receipt, Exhibit "1", that it was in payment, full or partial,
of the judgment obligation. Likewise, there is no indication in the pacto de retro sale which was
drawn in favor of Jesus Marcos Roces and Marcos V. Roces and not the respondent corporation,
that the obligation embodied therein had something to do with petitioners' judgment obligation
with respondent corporation.
Finding that the common exhibit, Exhibit 1/A had been signed by persons other than judgment
creditors (Roces-Reyes Realty, Inc.) coupled with the fact that said exhibit was not even alleged
by GEE and Lim Ka Ping in their original motion to quash the alias writ of execution (Rollo, p.
37) but produced only during the hearing (Ibid.) which production resulted in petitioners having
to claim belatedly that there was an "overpayment" of about half a million pesos (Rollo, pp. 25-
27) and remarking on the utter absence of any writing in Exhibits "1/A" and "2/B" to indicate
payment of the judgment debt, respondent Appellate Court correctly concluded that there was in
fact no payment of the judgment debt. As aptly observed by the said court:
What immediately catches one's attention is the total absence of any writing alluding to or
referring to any settlement between the parties of private respondents' (petitioners') judgment
obligation. In moving for the dismissal of the appeal Lim Ka Ping who was then assisted by
counsel simply stated that defendants (herein petitioners) are satisfied with the decision of the
Metropolitan Trial Court (Records of CA, p. 54).
Notably, in private respondents' (petitioners') Motion to Quash the Writ of Execution and Notice
of Levy dated March 7, 1985, there is absolutely no reference to the alleged payment of one
million pesos as evidenced by Exhibit 1 dated September 20, 1984. As pointed out by petitioner
(respondent corporation) this was brought out by Linda Panutat, Manager of Good Earth only in
the course of the latter's testimony. (Rollo, p. 37)
Article 1240 of the Civil Code of the Philippines provides that:
Payment shall be made to the person in whose favor the obligation has been constituted, or his
successor in interest, or any person authorized to receive it.
In the case at bar, the supposed payments were not made to Roces-Reyes Realty, Inc. or to its
successor in interest nor is there positive evidence that the payment was made to a person
authorized to receive it. No such proof was submitted but merely inferred by the Regional Trial
Court (Rollo, p. 25) from Marcos Roces having signed the Lease Contract as President which
was witnessed by Jesus Marcos Roces. The latter, however, was no longer President or even an
officer of Roces-Reyes Realty, Inc. at the time he received the money (Exhibit "1") and signed
the sale with pacto de retro (Exhibit "2"). He, in fact, denied being in possession of authority to
receive payment for the respondent corporation nor does the receipt show that he signed in the
same capacity as he did in the Lease Contract at a time when he was President for respondent
corporation (Rollo, p. 20, MTC decision).
On the other hand, Jesus Marcos Roces testified that the amount of P1 million evidenced by the
receipt (Exhibit "1") is the payment for a loan extended by him and Marcos Roces in favor of
Lim Ka Ping. The assertion is home by the receipt itself whereby they acknowledged payment of
the loan in their names and in no other capacity.
A corporation has a personality distinct and separate from its individual stockholders or
members. Being an officer or stockholder of a corporation does not make one's property also of
the corporation, and vice-versa, for they are separate entities (Traders Royal Bank v. CA-G.R.
No. 78412, September 26, 1989; Cruz v. Dalisay, 152 SCRA 482). Shareowners are in no legal
sense the owners of corporate property (or credits) which is owned by the corporation as a
distinct legal person (Concepcion Magsaysay-Labrador v. CA-G.R. No. 58168, December 19,
1989). As a consequence of the separate juridical personality of a corporation, the corporate debt
or credit is not the debt or credit of the stockholder, nor is the stockholder's debt or credit that of
the corporation (Prof. Jose Nolledo's "The Corporation Code of the Philippines, p. 5, 1988
Edition, citing Professor Ballantine).
The absence of a note to evidence the loan is explained by Jesus Marcos Roces who testified that
the IOU was subsequently delivered to private respondents (Rollo, pp. 97-98). Contrary to the
Regional Trial Court's premise that it was incumbent upon respondent corporation to prove that
the amount was delivered to the Roces brothers in the payment of the loan in the latter's favor,
the delivery of the amount to and the receipt thereof by the Roces brothers in their names raises
the presumption that the said amount was due to them.1âwphi1 There is a disputable
presumption that money paid by one to the other was due to the latter (Sec. 5(f) Rule 131, Rules
of Court). It is for GEE and Lim Ka Ping to prove otherwise. In other words, it is for the latter to
prove that the payments made were for the satisfaction of their judgment debt and not vice versa.
The fact that at the time payment was made to the two Roces brothers, GEE was also indebted to
respondent corporation for a larger amount, is not supportive of the Regional Trial Court's
conclusions that the payment was in favor of the latter, especially in the case at bar where the
amount was not receipted for by respondent corporation and there is absolutely no indication in
the receipt from which it can be reasonably inferred, that said payment was in satisfaction of the
judgment debt. Likewise, no such inference can be made from the execution of the pacto de retro
sale which was not made in favor of respondent corporation but in favor of the two Roces
brothers in their individual capacities without any reference to the judgment obligation in favor
of respondent corporation.
In addition, the totality of the amount covered by the receipt (Exhibit "1/A") and that of the sale
with pacto de retro (Exhibit "2/B") all in the sum of P2 million, far exceeds petitioners' judgment
obligation in favor of respondent corporation in the sum of P1,560,000.00 by P440,000.00,
which militates against the claim of petitioner that the aforesaid amount (P2M) was in full
payment of the judgment obligation.
Petitioners' explanation that the excess is interest and advance rentals for an extension of the
lease contract (Rollo, pp. 25-28) is belied by the absence of any interest awarded in the case and
of any agreement as to the extension of the lease nor was there any such pretense in the Motion
to Quash the Alias Writ of Execution.
Petitioners' averments that the respondent court had gravely abused its discretion in arriving at
the assailed factual findings as contrary to the evidence and applicable decisions of this
Honorable Court are therefore, patently unfounded. Respondent court was correct in stating that
it "cannot go beyond what appears in the documents submitted by petitioners themselves
(Exhibits "1" and "2") in the absence of clear and convincing evidence" that would support its
claim that the judgment obligation has indeed been fully satisfied which would warrant the
quashal of the Alias Writ of Execution.
It has been an established rule that when the existence of a debt is fully established by the
evidence (which has been done in this case), the burden of proving that it has been extinguished
by payment devolves upon the debtor who offers such a defense to the claim of the plaintiff
creditor (herein respondent corporation) (Chua Chienco v. Vargas, 11 Phil. 219; Ramos v.
Ledesma, 12 Phil. 656; Pinon v. De Osorio, 30 Phil. 365). For indeed, it is well-entrenched in
Our jurisprudence that each party in a case must prove his own affirmative allegations by the
degree of evidence required by law (Stronghold Insurance Co. v. CA, G.R. No. 83376, May
29,1989; Tai Tong Chuache & Co. v. Insurance Commission, 158 SCRA 366).
The appellate court cannot, therefore, be said to have gravely abused its discretion in finding lack
of convincing and reliable evidence to establish payment of the judgment obligation as claimed
by petitioner. The burden of evidence resting on the petitioners to establish the facts upon which
their action is premised has not been satisfactorily discharged and therefore, they have to bear the
consequences.
PREMISES CONSIDERED, the petition is hereby DENIED and the Decision of the Respondent
court is hereby AFFIRMED, reinstating the April 8, 1985 Resolution of the Metropolitan Trial
Court of Manila.
SO ORDERED.

G. Criminal Law
Criminal Law- branch of public laws that defines crimes, treaties of their nature and provides
for their punishment. The substantive criminal law is that law which for the purpose of
preventing harm to society: (a) declares what conduct is criminal, and (b) prescribes the
punishment to be imposed for such conduct. It includes the specific offenses and general
principles of liability.

People v Bandian
G.R. No. 45186, September 30, 1936

DIAZ, J.:
Charged with the crime of infanticide, convicted thereof and sentenced to reclusion perpetua and
the corresponding accessory penalties, with the costs of the suit, Josefina Bandian appealed from
said sentence alleging that the trial court erred:
I. In taking into consideration, to convict her, her alleged admission to Dr. Nepomuceno that she
had thrown away her newborn babe, and
II. In holding her guilty of infanticide, beyond reasonable doubt, and in sentencing her to
reclusion perpetua, with costs.
The facts of record ma be summarized as follows:
At about 7 o'clock in the morning of January 31, 1936, Valentin Aguilar, the appellant's
neighbor, saw the appellant go to a thicket about four or five brazas from her house, apparently
to respond to a call of nature because it was there that the people of the place used to go for that
purpose. A few minutes later, he again saw her emerge from the thicket with her clothes stained
with blood both in the front and back, staggering and visibly showing signs of not being able to
support herself. He ran to her aid and, having noted that she was very weak and dizzy, he
supported and helped her go up to her house and placed her in her own bed. Upon being asked
before Aguilar brought her to her house, what happened to her, the appellant merely answered
that she was very dizzy. Not wishing to be alone with the appellant in such circumstances,
Valentin Aguilar called Adriano Comcom, who lived nearby, to help them, and later requested
him to take bamboo leaves to stop the hemorrhage which had come upon the appellant. Comcom
had scarcely gone about five brazas when he saw the body of a newborn babe near a path
adjoining the thicket where the appellant had gone a few moments before. Comcom informed
Aguilar of it and latter told him to bring the body to the appellant's house. Upon being asked
whether the baby which had just been shown to her was hers or not, the appellant answered in
the affirmative.
Upon being notified of the incident at 2 o'clock in the afternoon of said day, Dr. Emilio
Nepomuceno, president of the sanitary division of Talisayan, Oriental Misamis, went to the
appellant's house and found her lying in bed still bleeding. Her bed, the floor of her house and
beneath it, directly under the bed, were full of blood. Basing his opinion upon said facts, the
physician in question declared that the appellant gave birth in her house and in her own bed; that
after giving birth she threw her child into the thicket to kill it for the purpose of concealing her
dishonor from the man, Luis Kirol, with whom she had theretofore been living maritally, because
the child was not his but of another man with whom she had previously had amorous relations.
To give force to his conclusions, he testified that the appellant had admitted to him that she had
killed her child, when he went to her house at the time and on the date above-stated.
The prosecuting attorney and the lower court giving absolute credit to Dr. Nepomuceno whose
testimony was not corroborated but, on the contrary, was contradicted by the very witnesses for
the prosecution and by the appellant, as will be stated later, they were of the opinion and the
lower court furthermore held, that the appellant was an infanticide. The Solicitor-General,
however, does not agree with both. On the contrary, he maintains that the appellant may be
guilty only of abandoning a minor under subsection 2 of article 276 of the Revised Penal Code,
the abandonment having resulted in the death of the minor allegedly abandoned.
By the way, it should be stated that there is no evidence showing how the child in question died.
Dr. Nepomuceno himself affirmed that the wounds found in the body of the child were not
caused by the hand of man but by bites animals, the pigs that usually roamed through the thicket
where it was found.
Infanticide and abandonment of a minor, to be punishable, must be committed wilfully or
consciously, or at least it must be result of a voluntary, conscious and free act or omission. Even
in cases where said crimes are committed through mere imprudence, the person who commits
them, under said circumstances, must be in the full enjoyment of his mental faculties, or must be
conscious of his acts, in order that he may be held liable.
The evidence certainly does not show that the appellant, in causing her child's death in one way
or another, or in abandoning it in the thicket, did so wilfully, consciously or imprudently. She
had no cause to kill or abandon it, to expose it to death, because her affair with a former lover,
which was not unknown to her second lover, Luis Kirol, took place three years before the
incident; her married life with Kirol — she considers him her husband as he considers her his
wife — began a year ago; as he so testified at the trial, he knew that the appellant was pregnant
and he believed from the beginning, affirming such belief when he testified at the trial, that the
child carried by the appellant in her womb was his, and he testified that he and she had been
eagerly waiting for the birth of the child. The appellant, therefore, had no cause to be ashamed of
her pregnancy to Kirol.
If to the foregoing facts is added the testimony of the witnesses Valentin Aguilar and Adriano
Comcom that the child was taken from the thicket and carried already dead to the appellant's
house after the appellant had left the place, staggering, without strength to remain on her feet and
very dizzy, to the extent of having to be as in fact she was helped to go up to her house and to lie
in bed, it will clearly appear how far from the truth were Dr. Nepomuceno's affirmation and
conclusions. Also add to all these the fact that the appellant denied having made any admission
to said physician and that from the time she became pregnant she continuously had fever. This
illness and her extreme debility undoubtedly caused by her long illness as well as the
hemorrhage which she had upon giving birth, coupled with the circumstances that she is a
primipara, being then only 23 years of age, and therefore inexperienced as to childbirth and as to
the inconvenience or difficulties usually attending such event; and the fact that she, like her lover
Luis Kirol — a mere laborer earning only twenty-five centavos a day — is uneducated and could
supplant with what she had read or learned from books what experience itself could teach her,
undoubtedly were the reasons why she was not aware of her childbirth, or if she was, it did not
occur to her or she was unable, due to her debility or dizziness, which causes may be considered
lawful or insuperable to constitute the seventh exempting circumstance (art. 12, Revised Penal
Code), to take her child from the thicket where she had given it birth, so as not to leave it
abandoned and exposed to the danger of losing its life.
The act performed by the appellant in the morning in question, by going into the thicket,
according to her, to respond to call of nature, notwithstanding the fact that she had fever for a
long time, was perfectly lawful. If by doing so she caused a wrong as that of giving birth to her
child in that same place and later abandoning it, not because of imprudence or any other reason
than that she was overcome by strong dizziness and extreme debility, she should not be blamed
therefor because it all happened by mere accident, from liability any person who so acts and
behaves under such circumstances (art. 12, subsection 4, Revised Penal Code).
In conclusion, taking into account the foregoing facts and considerations, and granting that the
appellant was aware of her involuntary childbirth in the thicket and that she later failed to take
her child therefrom, having been so prevented by reason of causes entirely independent of her
will, it should be held that the alleged errors attributed to the lower court by the appellant are
true; and it appearing that under such circumstances said appellant has the fourth and seventh
exempting circumstances in her favor, is hereby acquitted of the crime of which she had bee
accused and convicted, with costs de oficio, and she is actually confined in jail in connection
with this case, it is ordered that she be released immediately. So ordered.
Avanceña, C. J., and Abad Santos, J., concur.

H. Remedial Law
Remedial Law- provides for the manner in the protecting and enforcement of substantive rights.
Generally divided into civil procedure, criminal procedure, evidence, special proceedings and
rules on the admission and appreciation of electronic evidence.

Tan v CA, Magdangal

G.r No. 136368, January 16, 2002
PUNO, J.:
This is a petition for review of the Decision of the Court of Appeals dated July 15, 19981 and its
Resolution dated November 9, 19982 denying petitioner's motion for reconsideration in CA-G.R.
SP-41738.
The facts are as stated in the impugned Decision, viz:
"Involved in this case is a parcel of land, designated as Lot No. 645-C, with an area of 34,829
square meters, more or less, situated in Bunawan, Davao City. The lot was once covered by TCT
No. T-72067 of the Registry of Deeds of Davao City in the name of the late Jaime C. Tan (Tan,
for short) married to Praxedes V. Tan.
From the petition, the motion to dismiss petition, their respective annexes and other pleadings,
we gather the following factual antecedents:
On January 22, 1981, Tan, for a consideration of P59,200.00, executed a deed of absolute sale
over the property in question in favor of spouses Jose Magdangal and Estrella Magdangal.
Simultaneous with the execution of this deed, the same contracting parties entered into another
agreement whereunder Tan given one (1) year within which to redeem or repurchase the
property.
Albeit given several opportunities and/or extensions to exercise the option, Tan failed to redeem
the property until his death on January 4, 1988.
On May 2, 1988, Tan's heirs filed before the Regional Trial Court at Davao City a suit against
the Magdangals for reformation of instrument. Docketed as CIVIL CASE NO. 19049-88, the
complaint alleged that, while Tan and the Magdangals denominated their agreement as deed of
absolute sale, their real intention was to conclude an equitable mortgage.
Barely hours after the complaint was stamped 'received,' the Magdangals were able to have Tan's
title over the lot in question canceled and to secure in their names TCT No. T-134470. This
development prompted the heirs of Tan, who were to be later substituted by Jaime V. Tan, Jr.
(Tan, Jr.) as plaintiff, to file a supplemental complaint.
The intervening legal tussles are not essential to this narration. What is material is that on June 4,
1991, Branch 11 of the Regional Trial Court of Davao City rendered judgment finding for Tan,
Jr., as plaintiff therein. The dispositive portion of the decision reads:.
'WHEREFORE, judgment is rendered:
1. The Deed of Absolute Sale (Exhibits B, B-1) is, in accordance with the true intention of the
parties, hereby declared and reformed an equitable mortgage;
2. The plaintiff is ordered to pay the defendants within 120 days after the finality of this decision
P59,200 plus interest at the rate of 12% per annum from May 2, 1988, the date the complaint was
filed, until paid;
3. In order to avoid multiplicity of suits and to fully give effect to the true intention of the parties,
upon the payment of the aforesaid amount, TCT No. T-134470 in the name of defendants Jose
Magdangal and Estrella Magdangal (Exh. 13) and shall be deemed canceled and null and void
and TCT No. T-72067 in the name of Jaime C. Tan and Praxedes Valles Tan (Exh. A) be
reinstated).
No pronouncement as to costs.
SO ORDERED. (Annex 'B', Petition; Emphasis added).'
From the above, the Magdangals appealed to this Court in CA-G.R. CV No. 33657.
In a decision promulgated on September 28, 1995, this Court, thru its then Special Third
Division, affirmed in toto the appealed decision of the lower court. Copy of this affirmatory
judgment was each received by the Magdangals and Tan, Jr. on October 5, 1995.
On March 13, 1996, the Clerk of this Court entered in the Book of Entries of Judgment the
Decision in CA-G.R. CV No. 33657 and issued the corresponding Entry of Judgment which, on
its face, stated that the said Decision 'has on October 21, 1995 become final and executory'
(Annex 'L', Petition; Emphasis added).
On March 21, 1996, the Magdangals filed in the lower court a MOTION FOR
CONSOLIDATION AND WRIT OF POSSESSION, therein alleging that they did not appeal
from the aforesaid decision of this Court, adding '[T]hat the appealed judgment of the Court of
Appeals has become final and executory 15 days from October 5, 1995 or up to October 20,
1995, which the 120 days redemption period commences. And noting that the redemption period
has expired without Tan, Jr. exercising his option, the Magdangals thus prayed that the title 'in
the name of Jaime C. Tan and Praxedes Tan be consolidated and confirmed in the name of the
(Magdangals) x x x and pending such issuance, a writ of possession be ordered issued (Annex
"C", Petition).1âwphi1.nêt
In opposition to this motion (Annex 'F', Petition), Tan, Jr. alleged, among other things, that until
an entry of judgment has been issued by the Court of Appeals and copy thereof furnished the
parties, the appealed decision of the court a quo in this case cannot be considered final and
executory. Pressing the point, Tan, Jr., citing Cueto vs. Collantes, infra., would then assert that
the period of redemption on his part commenced to run from receipt of entry of judgment in CA-
G.R. CV No. 33657.
Meanwhile, Tan, Jr. via a motion for execution dated March 27, 1996, which he filed directly
with this court, prayed this court to direct the court a quo to issue the corresponding writ of
execution in Civil Case No. 19049-88. In a related move, Tan, Jr. filed on April 16, 1996, a
MANIFESTATION AND MOTION therein advising the court a quo of his intention to redeem
the property in question and of the fact that, on such date, he has deposited with its clerk of court
the repurchase price, plus interest, as required by its original decision. By way of relief, Tan, Jr.
prayed that the Magdangals be ordered to claim the amount thus deposited and the Register of
Deeds of Davao City, to reinstate the title of Jaime Tan and Praxedes Tan.
Jointly acting on the aforementioned MOTON FOR CONSOLIDATION AND WRIT OF
POSSESION of the Magdangals (Annex 'C', Petition), MANIFESTATION AND MOTION of
Tan, Jr. (Annex 'I', Petition), the court a quo presided by the respondent judge, came out with the
first challenged order of June 10, 1996 (Annex 'N', Petition) dispositively reading, as follows:
'WHEREFORE, x x x the Motion for Consolidation and a Writ of Possession is hereby DENIED
for lack of merit.
The deposit of the amount of P116,032.00 made by plaintiff with the Office of Court x x x on
April 17, 1996 is hereby considered full payment of the redemption price and the Clerk of Court
is hereby ordered to deliver said amount to herein defendants.
The Register of Deeds of Davao City x x x is hereby directed to cancel TCT No. T-134470 in the
name of Jose Magdangal and Estrella Magdangal and, thereafter, to reinstate TCT No. 72067 in
the name of Jaime C. Tan and Praxedes Valles Tan and to submit her compliance thereto within
ten (10) days from receipt of this Order.
SO ORDERED.'
Explaining her action, the respondent judge wrote in the same order:
'Following the ruling of the Supreme Court in Cueto vs. Collantes, et al., 97 Phil. 325, the 120
days period for plaintiff to pay the amount of P59,200.00 plus interest x x x should be reckoned
from the date of Entry of Judgment x x x which was March 13, 1996. The plaintiff made a
deposit on April 17, 1996 well within the 120-day period mandated by the decision of this
Court.'
In due time, the Magdangals moved for a reconsideration. However, in her next assailed order of
July 24, 1996 (Annex 'R', Petition), the respondent judge denied the motion for being proforma
and fatally defective."3
Petitioner assails the aforequoted Decision as follows:
"I. Petitioner's right to due process was violated when the Court of Appeals rendered a judgment
on the merits of private respondents' petition without granting to petitioner the opportunity to
controvert the same.
II. Appeal not certiorari was the appropriate remedy of private respondents as there was no grave
abuse of discretion as to amount to lack of or excess of jurisdiction on the part of the trial judge.
Neither is delay in resolving the main case a ground for giving due course to the petition.
III. Cueto vs. Collantes, 97 Phil. 325, was disregarded by the Court of Appeals in resolving the
petition of private respondents. It is still good case law and was in effect made a part of section 2
of Rule 68 of the 1997 Rules of Civil Procedure on Foreclosure of Mortgage.
IV. The St. Dominic vs. Intermediate Appellate Court, 138 SCRA 242 case is not applicable to
the case at bar; on the other hand the ruling in Gutierrez Hermanos vs. de La Riva, 46 Phil. 827,
applies.
V. Equity considerations justify giving due course to this petition."4 (emphasis ours)
We will immediately resolve the key issue of what rule should govern the finality of judgment
favorably obtained in the trial court by the petitioner.
The operative facts show that in its Decision of June 4, 1991, the trial court held that: (1) the
contract between the parties is not an absolute sale but an equitable mortgage; and (2) petitioner
Tan should pay to the respondents Magdangal "within 120 days after the finality of this decision
P59,200.00 plus interest at the rate of 12% per annum from May 2, 1988, the date the complaint
was filed, until paid."5
On September 28, 1995 in CA-G.R. CV No. 33657, the Special Third Division of the Court of
Appeals affirmed the decision of the trial court in toto. Both parties received the decision of the
appellate court on October 5, 1995. On March 13, 1996, the clerk of court of the appellate court
entered in the Book of Entries of Judgement the decision in CA-G.R. CV No. 33657 and issued
the corresponding Entry of Judgment which, on its face, stated that the said decision "has on
October 21, 1995 become final and executory."6
The respondents Magdangal filed in the trial court a Motion for Consolidation and Writ of
Possession.7 They alleged that the 120-day period of redemption of the petitioner has expired.
They reckoned that the said period began 15 days after October 5, 1995, the date when the
finality of the judgment of the trial court as affirmed by the appellate court commenced to run.
On the other hand, petitioner filed on March 27, 1996 a motion for execution in the appellate
court praying that it "direct the court a quo to issue the corresponding writ of execution in Civil
Case No. 19049-88."8 On April 17, 1996, petitioner deposited with the clerk of court the
repurchase price of the lot plus interest as ordered by the decision.
On June 10, 1996, the trial court allowed the petitioner to redeem the lot in question. It ruled that
the 120-day redemption period should be reckoned from the date of Entry of Judgment in the
appellate court or from March 13, 1996.9 The redemption price was deposited on April 17, 1996.
As aforestated, the Court of Appeals set aside the ruling of the trial court.
From 1991-1996, the years relevant to the case at bar, the rule that governs finality of judgment
is Rule 51 of the Revised Rules of Court. Its sections 10 and 11 provide:
"SEC. 10. Entry of judgments and final resolutions. - If no appeal or motion for new trial or
reconsideration is filed within the time provided in these Rules, the judgment or final resolution
shall forthwith be entered by the clerk in the book of entries of judgments. The date when the
judgment or final resolution becomes executory shall be deemed as the date of its entry. The
record shall contain the dispositive part of the judgment or final resolution and shall be signed by
the clerk, with a certificate that such judgment or final resolution has become final and
executory. (2a, R36)
SEC. 11. Execution of judgment. - Except where the judgment or final order or resolution, or a
portion thereof, is ordered to be immediately executory, the motion for its execution may only be
filed in the proper court after its entry.
In original actions in the Court of Appeals, its writ of execution shall be accompanied by a
certified true copy of the entry of judgment or final resolution and addressed to any appropriate
officer for its enforcement.
In appealed cases, where the motion for execution pending appeal is filed in the Court of
Appeals at a time that it is in possession of the original record or the record on appeal, the
resolution granting such motion shall be transmitted to the lower court from which the case
originated, together with a certified true copy of the judgment or final order to be executed, with
a directive for such court of origin to issue the proper writ for its enforcement."
This rule has been interpreted by this Court in Cueto vs. Collantes as follows:10
"The only error assigned by appellants refer to the finding of the lower court that plaintiff can
still exercise his right of redemption notwithstanding the expiration of the 90-day period fixed in
the original decision and, therefore, defendants should execute the deed of reconveyance
required in said decision. Appellants contend that, the final judgment of the Court of Appeals
having been entered on July 8, 1953, the 90-day period for the exercise of the right of
redemption has long expired, it appearing that plaintiff deposited the redemption money with the
clerk of court only on October 17, 1953, or, after the expiration of 101 days. Appellee brands this
computation as erroneous, or one not in accordance with the procedure prescribed by the rules of
court.
Appellee's contention should be sustained. The original decision provides that appellee may
exercise his right of redemption within the period of 90 days from the date the judgment has
become final. It should be noted that appellee had appealed from this decision. This decision was
affirmed by the court of appeals and final judgment was entered on July 8, 1953. Does this mean
that the judgment became final on that date?
Let us make a little digression for purposes of clarification. Once a decision is rendered by the
Court of Appeals a party may appeal therefrom by certiorari by filing with the Supreme Court a
petition within 10 days from the date of entry of such decision (Section 1, Rule 46). The entry of
judgment is made after it has become final, i.e., upon the expiration of 15 days after notice
thereof to the parties (Section 8, Rule 53, as modified by a resolution of the Supreme Court dated
October 1, 1945). But, as Chief Justice Moran has said, 'such finality *** is subject to the
aggrieved party's right of filing a petition for certiorari under this section,' which means that 'the
Court of Appeals shall remand the case to the lower court for the execution of its judgment, only
after the expiration of ten (10) days from the date of such judgment, if no petition for certiorari is
filed within that period.' (1 Moran, Comments on the Rules of Court, 1952 ed., p. 950) It would
therefore appear that the date of entry of judgment of the Court of Appeals is suspended when a
petition for review is filed to await the final entry of the resolution or decision of the Supreme
Court.
Since in the present case appellee has filed a petition for review within the reglementary period,
which was dismissed by resolution of July 6, 1953, and for lack of a motion for reconsideration
the entry of final judgment was made on August 7, 1953, it follows that the 90-day period within
which appellee may exercise his right of redemption should be counted from said date, August 7,
1953. And appellee having exercised such right on October 17, 1953 by depositing the
redemption money with the clerk of court, it is likewise clear that the motion be filed for the
exercise of such right is well taken and is within the purview of the decision of the lower
court."11
On April 18, 1994, this Court issued Circular No. 24-94, viz:
"TO: COURT OF APPEALS, SANDIGANBAYAN, COURT OF TAX APPEALS, REGIONAL
TRIAL COURTS, METROPOLITAN TRIAL COURTS, MUNICIPAL TRIAL COURTS,
MUNICIPAL CIRCUIT TRIAL COURTS, AND ALL MEMBERS OF THE INTEGRATED
BAR OF THE PHILIPPINES
SUBJECT: RESOLUTION OF THE COURT EN BANC APPROVING AND
PROMULGATING THE REVISED PROVISION ON EXECUTION OF JUDGMENTS.
SPECIFICALLY IN APPEALED CASES, AND AMENDING SECTION 1, RULE 39 OF THE
RULES OF COURT
It appears that in a number of instances, the execution of judgments in appealed cases cannot be
promptly enforced because of undue administrative delay in the remand of the records to the
court of origin, aggravated at times by misplacement or misdelivery of said records. The
Supreme Court Committee on the Revision of the Rules of Court has drafted proposals including
a provision which can remedy the procedural impasse created by said contingencies.
Accordingly, pending approval by the Court of the revised rules on Civil Procedure, and to
provide a solution to the aforestated problems, the Court Resolved to approve and promulgate
the following section thereof on execution of judgments, amending Section 1, Rule 39 of the
Rules of Court:
Section 1. Execution upon judgments or final orders. - Execution shall issue as a matter of right,
on motion, upon a judgment or order that disposes of the action or proceeding upon expiration of
the period to appeal therefrom if no appeal has been duly perfected.
If the appeal has been duly perfected and finally resolved, such execution may forthwith be
applied for in the lower court from which the action originated, on motion of the judgment
obligee, submitting therewith certified true copies of the judgment or judgments or the final
order or orders sought to be enforced and of the entry thereof, with notice to the adverse party.
The appellate court may, on motion in the same case, when the interest of justice so requires,
direct the court of origin to issue the writ of execution.
This resolution shall be published in two (2) newspapers of general circulation and shall take
effect on June 1, 1994.
April 18, 1994.
"(Sgd.) ANDRES R. NARVASA
Chief Justice"
The Circular took effect on June 1, 1994.
The 1997 Revised Rules of Civil Procedure, however, amended the rule on finality of judgment
by providing in section 1, Rule 39 as follows:
"Section 1. Execution upon judgments or final orders. - Execution shall issue as a matter of right,
on motion, upon a judgment or order that disposes of the action or proceeding upon the
expiration of the period to appeal therefrom if no appeal has been duly perfected. (1a)
If the appeal has been duly perfected and finally resolved, the execution may forthwith be
applied for in the court of origin, on motion of the judgment obligee, submitting therewith
certified true copies of the judgment or judgments or final order or orders sought to be enforced
and of the entry thereof, with notice to the adverse party.
The appellate court may, on motion in the same case, when the interest of justice so requires,
direct the court of origin to issue the writ of execution."
The rationale of the new rule is explained by retired Justice F.D. Regalado as follows:12
"1. The term 'final order' is used in two senses depending on whether it is used on the issue of
appealability or on the issue of binding effect. For purposes of appeal, an order is "final" if it
disposes of the action, as distinguished from an interlocutory order which leaves something to be
done in the trial court with respect to the merits of the case (De la Cruz, et al. vs. Paras, et al., L-
41053, Feb. 27, 1976). For purposes of binding effect or whether it can be subject of execution,
an order is 'final' or executory after the lapse of the reglementary period to appeal and no appeal
has been perfected (see Perez, et al. vs. Zulueta, L-10374, Sept. 30, 1959; cf. Denso [Phil.], Inc.
vs. IAC, et al., G.R. No. 75000, Feb. 27, 1987; Montilla vs. CA, et al., L-47968, May 9, 1988).
2. On the aspect of appealability, these revised Rules use the adjective 'final' with respect to
orders and resolutions, since to terminate a case the trial courts issue orders while the appellate
courts and most of the quasi-judicial agencies issue resolutions. Judgment are not so qualified
since the use of the so-called interlocutory judgments is not favored in this jurisdiction, while the
categorization of an order or a resolution for purposes of denoting that it is appealable is to
distinguish them from interlocutory orders or resolutions. However, by force of extended usage
the phrase 'final and executory judgment' is sometimes used and tolerated, although the use of
'executory' alone would suffice. These observations also apply to the several and separate
judgments contemplated in Rule 36, or partial judgments which totally dispose of a particular
claim or severable part of the case, subject to the power of the court to suspend or defer action on
an appeal from or further proceedings in such special judgment, or as provided by Rule 35 on the
matter of partial summary judgments which are not considered as appealable (see Sec. 4, Rule 35
and the explanation therein).
The second paragraph of this section is an innovation in response to complaints over the delay
caused by the former procedure in obtaining a writ of execution of a judgment, which has
already been affirmed on appeal, with notice to the parties. As things then stood, after the entry
of judgment in the appellate court, the prevailing party had to wait for the records of the case to
be remanded to the court of origin when and where he could then move for the issuance of a writ
of execution. The intervening time could sometimes be substantial, especially if the court a quo
is in a remote province, and could also be availed of by the losing party to delay or thwart actual
execution.
On these considerations, the Supreme Court issued Circular No. 24-94, dated April 18, 1994,
approving and promulgating in advance this amended Section 1 of Rule 39 and declaring the
same effective as of June 1, 1994.
Under the present procedure, the prevailing party can secure certified true copies of the judgment
or final order of the appellate court and the entry thereof, and submit the same to the court of
origin with and to justify his motion for a writ of execution, without waiting for its receipt of the
records from the appellate court. That motion must be with notice to the adverse party, with a
hearing when the circumstances so require, to enable him to file any objection thereto or bring to
the attention of said court matters which may have transpired during the pendency of the appeal
and which may have a bearing on the execution sought to enforce the judgment.
The third paragraph of this section, likewise a new provision, is due to the experience of the
appellate courts wherein the trial court, for reasons of its own or other unjustifiable
circumstances, unduly delays or unreasonably refuses to act on the motion for execution or issue
the writ therefor. On motion in the same case while the records are still with the appellate court,
or even after the same have been remanded to the lower court, the appellate court can direct the
issuance of the writ of execution since such act is merely in the enforcement of its judgment and
which it has the power to require."
It is evident that if we apply the old rule on finality of judgment, petitioner redeemed the subject
property within the 120-day period of redemption reckoned from the appellate court's entry of
judgment. The appellate court, however, did not apply the old rule but the 1997 Revised Rules of
Civil Procedure. In fine, it applied the new rule retroactively and we hold that given the facts of
the case at bar this is an error.
There is no dispute that rules of procedure can be given retroactive effect. This general rule,
however, has well-delineated exceptions. We quote author Agpalo:13
"9.17. Procedural laws.
Procedural laws are adjective laws which prescribe rules and forms of procedure of enforcing
rights or obtaining redress for their invasion; they refer to rules of procedure by which courts
applying laws of all kinds can properly administer justice. They include rules of pleadings,
practice and evidence. As applied to criminal law, they provide or regulate the steps by which
one who commits a crime is to be punished.
The general rule that statutes are prospective and not retroactive does not ordinarily apply to
procedural laws. It has been held that "a retroactive law, in a legal sense, is one which takes
away or impairs vested rights acquired under laws, or creates a new obligation and imposes a
new duty, or attaches a new disability, in respect of transactions or considerations already past.
Hence, remedial statutes or statutes relating to remedies or modes of procedure, which do not
create new or take away vested rights, but only operate in furtherance of the remedy or
confirmation of rights already existing, do not come within the legal conception of a retroactive
law, or the general rule against the retroactive operation of statutes." The general rule against
giving statutes retroactive operation whose effect is to impair the obligations of contract or to
disturb vested rights does not prevent the application of statutes to proceedings pending at the
time of their enactment where they neither create new nor take away vested rights. A new statute
which deals with procedure only is presumptively applicable to all actions - those which have
accrued or are pending.
Statutes regulating the procedure of the courts will be construed as applicable to actions pending
and undetermined at the time of their passage. Procedural laws are retroactive in that sense and
to that extent. 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. Nor is the retroactive application of procedural statutes constitutionally objectionable.
The reason is that as a general rule no vested right may attach to, nor arise from, procedural laws.
It has been held that "a person has no vested right in any particular remedy, and a litigant cannot
insist on the application to the trial of his case, whether civil or criminal, of any other than the
existing rules of procedure."
Thus, the provision of Batas Bilang 129 in Section 39 thereof prescribing that "no record on
appeal shall be required to take an appeal" is procedural in nature and should therefore be
applied retroactively to pending actions. Hence, the question as to whether an appeal from an
adverse judgment should be dismissed for failure of appellant to file a record on appeal within
thirty days as required under the old rules, which question is pending resolution at the time Batas
Bilang 129 took effect, became academic upon the effectivity of said law because the law no
longer requires the filing of a record on appeal and its retroactive application removed the legal
obstacle to giving due course to the appeal. A statute which transfers the jurisdiction to try
certain cases from a court to a quasi-judicial tribunal is a remedial statute that is applicable to
claims that accrued before its enactment but formulated and filed after it took effect, for it does
not create new nor take away vested rights. The court that has jurisdiction over a claim at the
time it accrued cannot validly try the claim where at the time the claim is formulated and filed
the jurisdiction to try it has been transferred by law to a quasi-judicial tribunal, for even actions
pending in one court may be validly taken away and transferred to another and no litigant can
acquire a vested right to be heard by one particular court.
9.18. Exceptions to the rule.
The rule that procedural laws are applicable to pending actions or proceedings admits certain
exceptions. The rule does not apply where the statute itself expressly or by necessary implication
provides that pending actions are excepted from its operation, or where to apply it to pending
proceedings would impair vested rights. Under appropriate circumstances, courts may deny the
retroactive application of procedural laws in the event that to do so would not be feasible or
would work injustice. Nor may procedural laws be applied retroactively to pending actions if to
do so would involve intricate problems of due process or impair the independence of the courts."
We hold that section 1, Rule 39 of the 1997 Revised Rules of Procedure should not be given
retroactive effect in this case as it would result in great injustice to the petitioner. Undoubtedly,
petitioner has the right to redeem the subject lot and this right is a substantive right. Petitioner
followed the procedural rule then existing as well as the decisions of this Court governing the
reckoning date of the period of redemption when he redeemed the subject lot. Unfortunately for
petitioner, the rule was changed by the 1997 Revised Rules of Procedure which if applied
retroactively would result in his losing the right to redeem the subject lot. It is difficult to
reconcile the retroactive application of this procedural rule with the rule of fairness. Petitioner
cannot be penalized with the loss of the subject lot when he faithfully followed the laws and the
rule on the period of redemption when he made the redemption. The subject lot may only be
34,829 square meters but as petitioner claims, "it is the only property left behind by their father,
a private law practitioner who was felled by an assassin's bullet."14
Petitioner fought to recover this lot from 1988. To lose it because of a change of procedure on
the date of reckoning of the period of redemption is inequitous. The manner of exercising the
right cannot be changed and the change applied retroactively if to do so will defeat the right of
redemption of the petitioner which is already vested.
IN VIEW WHEREOF, the decision of the Court of Appeals dated July 15, 1998 and its
Resolution dated November 9, 1998 in CA-G.R. SP-41738 are annulled and set aside. The
Orders dated June 10, 1996 and July 24, 1996 of the RTC of Davao City, 11th Judicial Region,
Branch 11, in Civil Case No. 19049-88 are reinstated. No costs.
SO ORDERED.

I. Legal Ethics and Legal Forms

Legal Ethics- is a branch of moral science that treats of the duties which an attorney owes to the
court, to his client, to his colleagues in the profession and to the public.

Cayetano v Monsod
G.r. No. 100113, September 3, 1991
Already digested!