RULE 3: PARTIES TO CIVIL ACTIONS

By: Atty. Edwin E. Torres (August 2019)

Section 1. ​Who may be parties​;​ plaintiff and defendant​. — Only natural or juridical persons, or entities
authorized by law may be parties in a civil action. The term "plaintiff" may refer to the claiming party, the
counter-claimant, the cross-claimant, or the third (fourth, etc.) — party plaintiff. The term "defendant"
may refer to the original defending party, the defendant in a counter-claim, the cross-defendant, or the
third (fourth, etc.) — party defendant.

Petitioner Association of Flood Victims is an ​UNINCORPORATED ASSOCIATION not endowed with a distinct
personality of its own. An unincorporated association, in the absence of an enabling law, has no juridical
personality and thus, cannot sue in the name of the association. Such unincorporated association is not a legal
entity distinct from its members. If an association, like petitioner Association of Flood Victims, has no juridical
1
personality, then all members of the association must be made parties in the civil action.

A publication may be considered a ​CORPORATION BY ESTOPPEL as the result of its having represented itself
to the reading public as a corporation despite its not being incorporated. Hence, it may be sued notwithstanding
its non-incorporation with the SEC. Otherwise, whoever of the public who would suffer any damage from the
2
publication of articles in the pages of its tabloids would be left without recourse.

 
Neither a ​DEAD PERSON nor his ​ESTATE may be a party-plaintiff in a court action. A deceased person does
not have such legal entity as is necessary to bring action so much so that a motion to substitute cannot lie and
should be denied by the court. An action begun by a decedent’s estate cannot be said to have been begun by a
legal person, since an estate is not a legal entity; such an action is a nullity and a motion to amend the party
plaintiff will not, likewise, lie, there being nothing before the court to amend. Considering that capacity to be
sued is a correlative of the capacity to sue, to the same extent, a decedent does not have the capacity to be
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sued and may not be named a party defendant in a court action.

There is no law authorizing ​SOLE PROPRIETORSHIPS to bring suit in court. The law merely recognizes the
existence of a sole proprietorship as a form of business organization conducted for profit by a single individual,
and requires the proprietor or owner thereof to secure licenses and permits, register the business name, and
pay taxes to the national government. It does not vest juridical or legal personality upon the sole proprietorship
nor empower it to file or defend an action in court. Hence, the complaint should have been filed in the name of
the owner of Juasing Hardware. The allegation in the body of the complaint would show that the suit is brought
by such person as proprietor or owner of the business conducted under the name and style Juasing Hardware.
The descriptive words "doing business as Juasing Hardware" may be added to the title of the case, as is
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customarily done.

Section 2. ​Parties in interest​. — A real party in interest is the party who stands to be benefited or
injured by the judgment in the suit, or the party entitled to the avails of the suit. Unless otherwise
authorized by law or these Rules, every action must be prosecuted or defended in the name of the real
party in interest.

The rule has two components, to wit: (​a​) to institute an action, the plaintiff must be the real party in interest; and
(​b​) the action must be prosecuted in the name of the real party in interest. Necessarily, the purposes of the rule
on real party in interest are: (​a)​ to prevent the prosecution of actions by persons without any right, title or interest
in the case; (​b​) to require that the actual party entitled to legal relief be the one to prosecute the action; (​c​) to
avoid a multiplicity of suits; and (​d​) to discourage litigation and keep it within certain bounds, pursuant to sound
public policy.

INTEREST​ within the meaning of the rule means a material interest or an interest in the issue to be affected by
the decree or judgment of the case, as distinguished from mere ​CURIOSITY ​ABOUT THE QUESTION involved.
Real interest means a present substantial interest, as distinguished from a mere ​EXPECTANCY or a future,
contingent, subordinate or consequential interest.

The same rule governs on ​APPEAL​, in that only a party in interest can challenge a decision. A party, in order to
appeal, must have a present interest in the subject matter of the litigation and must be aggrieved or prejudiced
by the judgment. A party is aggrieved or prejudiced when his interest recognized by law in the subject matter of
the lawsuit is injuriously affected by the judgment or order; on the other hand, a party not aggrieved by the
decision or order may not appeal because he would have no arguable error to assign on appeal. Thus, the
prevailing party in a lawsuit is not ordinarily entitled to appeal a decision or order in his favor.

1
Association of Flood Victims vs. COMELEC, ET AL. (G.R. No. 203775, 5 August 2014).
2
Macasaet, et al. vs. Co Jr. (G.R. No. 156759, 5 June 2013).
3
Galindo, et al. vs. Heirs of Roxas (G.R. No. 147969, 17 January 2005).
4
Navarro vs. Escobido (G.R. No. 153788, 27 November 2009).
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Although the ​Rules of Court​ so permit the offended party to take part in the prosecution of a criminal action, and
in certain instances on appeal from the order or judgment of the courts in a ​CRIMINAL ACTION​, the permission
to take part is true only where the party injured has to protect his pecuniary interest as part of the civil liability of
the accused. Said party cannot appeal the dismissal of a criminal case because such dismissal did not affect
the civil aspect of the crime. Only the OSG, in behalf of the Republic of the Philippines, may appeal the
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dismissal.

A lessee of property belonging to a municipality is not a real party in interest in a case for annulment of a private
person’s title to said property. The existence of his option to buy the property is not sufficient to constitute as
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material interest to commence the action.

The mayor of a municipality whose appointments were disapproved by the Civil Service Commission is a real
party in interest to appeal the CSC’s decision of disapproval. Appointment is an essentially discretionary power.
The CSC's disapproval of an appointment is a challenge to the exercise of the appointing authority's discretion.
The appointing authority must have the right to contest the disapproval. Besides the mayor has a substantial
interest in the case that has an impact on salaries that may be taken from municipal funds. But the mayor
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ceases to be a real party in interest if he ceases to be the mayor.

The administrative agency which resolved the conflicting claims of private persons is not a real party in interest
so as to pursue a remedy with respect to the judgment passed by a higher tribunal on his resolution of said
claims.

An ordinary civil action for declaration of nullity of free patents and certificates of title is not the same as an
action for reversion. In an action for reversion, the intended result is the return of land to the public domain.
Hence, the real party in interest in such action is the state represented by the Director of Lands. On the other
hand, in an action for declaration of nullity of free patent and certificate of title, the real party in interest is not the
State but the plaintiff who alleges a pre-existing right of ownership over the parcel of land in question even
8
before the grant of title to the defendant.

The parties to a contract are the real parties in interest in an action upon it. Only the contracting parties are
bound by the stipulation in the contract; they are the ones who would benefit from and could violate it. Thus,
one who is not a party to a contract, and for whose benefit it was not expressly made, cannot maintain an action
on it. One cannot do so, even if the contract performed by the contracting parties would incidentally inure to
one's benefit. As an ​exception​, parties who have not taken part in a contract may show that they have a real
interest affected by its performance or annulment. In other words, those who are not principally or subsidiarily
obligated in a contract, in which they had no intervention, may show their detriment that could result from it​.

Section 3. ​Representatives as parties.​ — Where the action is allowed to be prosecuted and defended by
a representative or someone acting in a fiduciary capacity, the beneficiary shall be included in the title
of the case and shall be deemed to be the real property in interest. A representative may be a trustee of
an express trust, a guardian, an executor or administrator, or a party authorized by law or these Rules.
An agent acting in his own name and for the benefit of an undisclosed principal may sue or be sued
without joining the principal except when the contract involves things belonging to the principal. (3a)

R.A. 6657 allows farmer leaders like Elvira Baladad to represent the Macabud farmers or their Samahan in the
proceedings before the DAR. The law, however, should be harmonized with the provisions of the Rules of
Court. Assuming that the Macabud farmers are real parties-in-interest as defined by Sec. 2 of Rule 3, the appeal
may be brought by their representative since such is allowed by R.A. 6657. The action may then be brought by
1) the organization represented by its authorized representative (Sec. 1) OR 2) the representative with the
beneficiaries identified in the title of the case (Sec. 3). In the first option, the organization should be duly
registered in order to be clothed with juridical personality (Sec. 1). Admittedly, petitioner Samahan is not
registered with the Securities and Exchange Commission. Thus, it is not a juridical person which can be a party
in a case. The Rules of Court, however, does not prevent the Macabud farmers from filing an appeal since an
action may be instituted in the name of their representative with each farmer-beneficiary identified in the title of
the case in accordance with Sec. 3 of Rule 3. Unfortunately, petitioner also failed to comply with this simple
requirement. The petition was brought by the unregistered Samahan represented by Elvira Baladad without
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mentioning the members of it. On this score, the petition can already be dismissed.

5
Decer, et al. vs. Lacson (G.R. No. 196209, 8 June 2011).
6
Spouses Oco vs. Limbaring (G.R. No. 161298, 31 January 2006).
7
Dagadag vs. Tongnawa and Gammod (G.R. No. 161166-67, 3 February 2005).
8
Tancuntian vs. Gempesaw, et al. (G.R. No. 149097, 18 October 2004).
9
SamahangMagsasakang 53 Hectarya.Represented by Balabad vs. Mosquera, et al. (G.R. No. 152430, 22 March 2007).
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Section 4. ​Spouses as parties.​ — Husband and wife shall sue or be sued jointly, except as provided by
law. (4a)

Pro-forma parties can either be indispensable, necessary or neither indispensable nor necessary. The third
case occurs if, for example, a husband files an action to recover a property which he claims to be part of his
exclusive property. The wife may have no legal interest in such property, but the rules nevertheless require that
she be joined as a party. In cases of pro-forma parties who are neither indispensable nor necessary, the
general rule under Section 11, Rule 3 must be followed: such non-joinder is not a ground for dismissal. Hence,
in a case concerning an action to recover a sum of money, we held that the failure to join the spouse in that
 
case was not a jurisdictional defect.The non-joinder of a spouse does not warrant dismissal as it is merely a
formal requirement which may be cured by amendment. Conversely, in the instances that the pro-forma parties
are also indispensable or necessary parties, the rules concerning indispensable or necessary parties, as the
case may be, should be applied. Thus, dismissal is warranted only if the pro-forma party not joined in the
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complaint is an indispensable party.

Art. 147 of the Civil Code provides that “the conjugal partnership shall be governed by the rules on the contract
of partnership.” Article 1811 of the same Code provides that "a partner is a co-owner with the other partners of
specific partnership property." Taken with the presumption of the conjugal nature of the funds used to finance
the four checks used to pay for petitioners’ stock subscriptions, and with the presumption that the credits
themselves are part of conjugal funds, Article 1811 makes Quirino and Milagros de Guzman co-owners of the
alleged credit. Being co-owners of the alleged credit, Quirino and Milagros de Guzman may separately bring an
action for the recovery thereof. In a co-ownership, co-owners may bring actions for the recovery of co-owned
property without the necessity of joining all the other co-owners as co-plaintiffs because the suit is presumed to
have been filed for the benefit of his co-owners. Article 487 of the Civil Code, which provides that any of the
co-owners may bring an action for ejectment, covers all kinds of action for the recovery of possession. In sum,
in suits to recover properties, all co-owners are real parties in interest. However, pursuant to Article 487 of the
Civil Code and relevant jurisprudence, any one of them may bring an action, any kind of action, for the recovery
of co-owned properties. Therefore, only one of the co-owners, namely the co-owner who filed the suit for the
recovery of the co-owned property, is an indispensable party thereto. The other co-owners are not indispensable
parties. They are not even necessary parties, for a complete relief can be accorded in the suit even without their
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participation, since the suit is presumed to have been filed for the benefit of all co-owners.

As the registered owner of Kargo Enterprises, Karen Go is the party who will directly benefit from or be injured
by a judgment in this case. Thus, contrary to Navarro’s contention, Karen Go is the real party-in-interest, and it
is legally incorrect to say that her Complaint does not state a cause of action because her name did not appear
in the Lease Agreement that her husband signed in behalf of Kargo Enterprises. Whether Glenn Go can legally
sign the Lease Agreement in his capacity as a manager of Kargo Enterprises, a sole proprietorship, is a
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question we do not decide, as this is a matter for the trial court to consider in a trial on the merits.

Section 5. ​Minor or incompetent persons​. — A minor or a person alleged to be incompetent, may sue or
be sued with the assistance of his father, mother, guardian, or if he has none, a guardian ​ad litem.​ (5a)

Section 6. ​Permissive joinder of parties.​ — All persons in whom or against whom any right to relief in
respect to or arising out of the same transaction or series of transactions is alleged to exist, whether
jointly, severally, or in the alternative, may, except as otherwise provided in these Rules, join as
plaintiffs or be joined as defendants in one complaint, where any question of law or fact common to all
such plaintiffs or to all such defendants may arise in the action; but the court may make such orders as
may be just to prevent any plaintiff or defendant from being embarrassed or put to expense in
connection with any proceedings in which he may have no interest. (6n)

Permissive joinder of parties requires that: (a) the right to relief arises out of the same transaction or series of
transactions; (b) there is a question of law or fact common to all the plaintiffs or defendants; and (c) such joinder
 is not otherwise proscribed by the provisions of the Rules on jurisdiction and venue. In this case, there is a
single transaction common to all, that is, Pantranco’s bus hitting the rear side of the jeepney. There is also a
common question of fact, that is, whether petitioners are negligent. There being a single transaction common to
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both respondents, consequently, they have the same cause of action against petitioners.

The principle contained in this provision amplifies the old procedure. Formerly, it was only community of interest
in the same subject which constituted a ground for joinder of parties; now, it is also the existence of a question
of fact or of law, provided the relief sought for or against the several parties arises from the same transaction or
series of transactions whether jointly, severally, or in the alternative. In this connection, the term "transaction"
means not only a stipulation or agreement, but any event resulting in wrong, without regard to whether the

10
Carandang vs. Heirs of De Guzman (G.R. No. 160347, 29 November 2006).
11
Ibid.
12
Op cit. Navarro vs. Escobido.
13
Pantranco North Express, Inc. and Buncan vs. Standard Insurance Company, Inc. (G.R. No. 140746, 16 March 2005).
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wrong has been done by violence, neglect or breach of contract. And the term "series of transactions" is
equivalent to "transactions" connected with the same subject of the action.

For instance, A, B, C, and D are owners, respectively, of four houses destroyed by fire caused by sparks coming
from a defective chimney of a passing locomotive owned by the Manila Railroad Company. Under the old
procedure, the four owners cannot join in a single complaint for damages against the Manila Railroad Company,
for the reason that they do not have a community of interest in the same subject of the litigation, each of them
being interested in covering the value of his house alone. Under the new procedure, they may join in a single
complaint, for a right to relief is alleged to exist in their favor severally arising out of the same cause, namely, the
single negligent act of the defendant by which the four houses were destroyed by fire, and which is also a
common question of fact to all of the four plaintiffs.

Again, several farmers, defending upon a system for the irrigation of their crops, have sustained damages by
reason of the diversion of the water from said system by the defendant company. Under the old procedure,
those several farmers cannot unite in a single action, they having no community of interest in the same subject,
for each of them is interested in the damages to his own farm and not in those of the others. But, under the new
procedure, they may join in a single action, for their right to relief arises from the occurence, namely, the
diversion of the water from the aforesaid system, which is also a question of fact common to all of them.

A collector of taxes for three political subdivisions in the United States gave a single fidelity bond. The state law
imposed on each political subdivision a liability for each proportionate share of the bond premium. ​Held:​ The
surety could join the three parties as defendants in an action to recover the premium although each of them is
liable seperately for one third of the premium, the right to relief having arisen from the same transaction, namely,
the giving of the bond, and there is a question of fact or of law common to all of the three defendants.

If a collision of motor cars, a chauffer sustained personal injuries and damages are caused to the car he was
driving, two causes of action arise: one, in favor of the chauffer for the injuries caused to his person, and
another, in favor of the owner of the car for the damages caused thereto. Under the old procedure, it is doubtful
whether the owner and the chauffer may join in a single complaint, because they are not interested in the same
subject, each of them claiming a different and separate kind of damages, but under the new procedure, they
may join, because a right of relief exists in their favor arising out of the same transaction or occurrence, namely,
the collision, and a question of fact will arise at the trial common to both of them.

If a person has a title to a real property which he has been possessing for many years, and four persons united
by the same purpose, successively deprived him of the property and later partioned it among themselves; under
the old procedure it was doubtful whether the four persons could be joined in a single action, each of them being
interested only in the portion he is occupying and not in the portions respectively occupied by the others. But
under the new procedure, it is clear that they may be joined in a single complaint, because a right to relief is
alleged to exist against all of them arising out of a series of occurrences, and question of fact common to all of
them will arise in the action, that is, the ownership and possession for years of the plaintiff.

As previously indicated, it is not enough that there be a question of fact common to several parties in order that
they may be joined; it is essential that a right of relief should exist in favor of, or against, all of them in respect to,
or arising out of, the same transaction or series of transactions. If the right to relief does not arise out of the
same transactions or series of transactions, although there may be a common question of fact, joinder is not
proper. For instance, if the plaintiff has a single title to and has been for many years in possession of, two
parcels of land, one of which had been taken by force by one of the defendants nine years ago, and the other,
by the other defendant five years ago under different circumstances, the two defendants cannot be joined, for
there is no right or relief against them arising out of the same transaction or occurrence, the acts of
dispossessions having been done separately, at different times and in a different manner, although there is a
question of fact common to them, which is the plaintiff's ownership and possession of the property.

Professor Sunderland rightly says that under these new rules a number of joinders are permissible, such as
claims for damages in the alternative against two independent tortfeasors; damages for injury to a house by the
owner and the occupier; damages claimed by many persons affected by the same libelous statement; claims
against a person causing a personal injury and a physician who afterwards negligently treats the patient.

Under the new liberal rule of joinder, a situation may arise in which, while one of the parties is proving his claim,
the other parties may have no interest therein and may remain idle in court. In this event, the above section
provides that "the court may make such orders as may be just to prevent any plaintiff or defendant from being
embarrassed or put to expense in connection with any proceedings in which he may have no interest." For
instance, in the first illustration given above, while one of the owners of the houses burned is proving the value
of his house, the others may have nothing to do in court, they having no interest in the subject matter of the
evidence being presented. In such case, the court may fix another time or date for each of the other plaintiffs to
14
introduce their respective proofs. (I Moran, Rules of Court, 3rd rev. ed., 36-40).

14
International Colleges, Inc. vs. Argonza, et al. (G.R. No. L-3884).
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The joinder of causes of action is indeed allowed under Section 5, Rule 2 of the 1997 Rules of Court; but if there
 are multiple parties, the joinder is made subject to the rules on joinder of parties under Section 6, Rule 3.
Specifically, before causes of action and parties can be joined in a complaint involving multiple parties, (1) the
right to relief must arise out of the same transaction or series of transactions and (2) there must be a question of
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law or fact common to all the parties.

Section 7. ​Compulsory joinder of indispensable parties.​ — Parties in interest without whom no final
determination can be had of an action shall be joined either as plaintiffs or defendants. (7)

Non-joinder means the "failure to bring a person who is a necessary party or in this case an indispensable party
into a lawsuit."

The non-joinder of indispensable parties is not a ground for the dismissal of an action. At any stage of a judicial
proceeding and/or at such times as are just, parties may be added on the motion of a party or on the initiative of
the tribunal concerned. If the plaintiff refuses to implead an indispensable party despite the order of the court,
that court may dismiss the complaint for the plaintiff’s failure to comply with the order. The remedy is to implead
 
the non-party claimed to be indispensable. Hence, the dismissal of the case for failure to state a cause of action
is improper. What the trial court should have done is to direct the plaintiff to implead all the heirs of Domingo
Fian, Sr. as defendants within a reasonable time from notice with a warning that his failure to do so shall mean
16
dismissal of the complaint.

In suits to recover properties, all co-owners are real parties in interest. However, pursuant to Article 487 of the
Civil Code and relevant jurisprudence, any one of them may bring an action, any kind of action, for the recovery
of co-owned properties. Therefore, only one of the co-owners, namely the co-owner who filed the suit for the
recovery of the co-owned property, is an indispensable party thereto. The other co-owners are not
indispensable parties. They are not even necessary parties, for a complete relief can be accorded in the suit
17
even without their participation, since the suit is presumed to have been filed for the benefit of all co-owners.

Is the owner of the property an indispensable party in an action for expropriation? Not necessarily. Under Rule
67, Section 1 of the Rules of Court, expropriation proceedings may be instituted even when "title to the property
sought to be condemned appears to be in the Republic of the Philippines, although occupied by private
individuals." The same rule provides that a complaint for expropriation shall name as defendants "all persons
owning or claiming to own, or occupying, any part thereof or interest" in the property sought to be condemned.
Clearly, when the property already appears to belong to the Republic, there is no sense in the Republic
instituting expropriation proceedings against itself. It can still, however, file a complaint for expropriation against
the private persons occupying the property. In such an expropriation case, the owner of the property is not an
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indispensable party.

Section 8. ​Necessary party​. — A necessary party is one who is not indispensable but who ought to be
joined as a party if complete relief is to be accorded as to those already parties, or for a complete
determination or settlement of the claim subject of the action. (8a)

Section 9. ​Non-joinder of necessary parties to be pleaded.​ — Whenever in any pleading in which a claim
is asserted a necessary party is not joined, the pleader shall set forth his name, if known, and shall state
why he is omitted. Should the court find the reason for the omission unmeritorious, it may order the
inclusion of the omitted necessary party if jurisdiction over his person may be obtained.

The failure to comply with the order for his inclusion, without justifiable cause, shall be deemed a waiver
of the claim against such party.

The non-inclusion of a necessary party does not prevent the court from proceeding in the action, and
the judgment rendered therein shall be without prejudice to the rights of such necessary party. (8a, 9a)

Section 10. ​Unwilling co-plaintiff.​ — If the consent of any party who should be joined as plaintiff cannot
be obtained, he may be made a defendant and the reason therefor shall be stated in the complaint. (10)

Section 11. ​Misjoinder and non-joinder of parties​. — Neither misjoinder nor non-joinder of parties is
ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of

15
Central Bank Board of Liquidators vs. Banco Filipino Savings and Mortgage Bank (G.R. No. 173399, 21 February 2017).
16
Heirs of Mesina vs. Heirs of Fian (G.R. No. 201816, 8 April 2013).
17
Op cit. Navarro vs. Escobido.
18
Republic of the Philippines vs. Mangotara (G.R. No. 170375, 7 July 2010).
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any party or on its own initiative at any stage the action and on such terms as are just. Any claim
against a misjoined party may be severed and proceeded with separately. (11a)

The general rule with reference to the making of parties in a civil action requires, of course, the joinder of all
necessary parties where possible, and the joinder of all indispensable parties under any and all conditions, their
presence being a sine qua non for the exercise of judicial power. It is precisely "when an indispensable party is
not before the court (that) the action should be dismissed." The absence of an indispensable party renders all
subsequent actions of the court null and void for want of authority to act, not only as to the absent parties but
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even as to those present.

A person who was not impleaded in the complaint cannot be bound by the decision rendered therein, for no man
shall be affected by a proceeding in which he is a stranger. The non-inclusion of a necessary party does not
prevent the court from proceeding with the action, and the judgment rendered therein shall be without prejudice
to the rights of such party.

The proper remedy when a party is left out is to implead the indispensable party at any stage of the action. The
court, either ​motu proprio​ or upon the motion of a party, may order the inclusion of the indispensable party or
give the plaintiff opportunity to amend his complaint in order to include indispensable parties. If the plaintiff to
whom the order to include the indispensable party is directed refuses to comply with the order of the court, the
 
complaint may be dismissed upon motion of the defendant or upon the court's own motion.Only upon unjustified
20
failure or refusal to obey the order to include or to amend is the action dismissed.

A third-party complaint may be a vehicle for impleading a third person as a party to the case. The court may
authorize filing of the proper third-party complaint to implead the other parties not included in the original
complaint, in keeping with the injunction that "all pleadings shall be liberally construed so as to do substantial
justice." ​A third- party complaint is "a claim that a defending party may, with leave of court, file against a person
not a party to the action, called the third- party defendant, for contribution, indemnity, subrogation or any other
21
relief in respect of his opponent's claim."

It is not late to join a person in a case where plaintiff has already rested its case because Section 11, Rule 3,
22
permits joinder “at any stage of the action.”

Section 12. ​Class suit.​ — When the subject matter of the controversy is one of common or general
interest to many persons so numerous that it is impracticable to join all as parties, a number of them
which the court finds to be sufficiently numerous and representative as to fully protect the interests of
all concerned may sue or defend for the benefit of all. Any party in interest shall have the right to
intervene to protect his individual interest. (12a)

What is contemplated is that (a) the subject matter in controversy is of common or general interest to many
persons, and (b) those persons are so numerous as to make it impracticable to bring them all before the court.
Illustrative of the rule is a so-called derivative suit brought in behalf of numerous stockholders of a corporation to
​ ct of the company's board of
perpetually enjoin or nullify what is claimed to be a breach of trust or an ​ultra vires a
directors. In such a suit, there is one, single right of action pertaining to numerous stockholders, not multiple
rights belonging separately to several, distinct persons. ​On the other hand, if there are many persons who have
distinct, separate rights against the same party or group of parties, but those rights arise from the same
transaction or series of transactions and there are common questions of fact or law resulting therefrom, the
former may join as plaintiffs in one action against the same defendant. This is authorized by the above
23
mentioned ​joinder-of- parties​ rule in Section 6 of Rule 3.

Section 13.​Alternative defendants.​ — Where the plaintiff is uncertain against who of several persons he
is entitled to relief, he may join any or all of them as defendants in the alternative, although a right to
relief against one may be inconsistent with a right of relief against the other. (13a)

Section 14.​Unknown identity or name of defendant.​ — Whenever the identity or name of a defendant is
unknown, he may be sued as the unknown owner heir devisee, or by such other designation as the case
may require, when his identity or true name is discovered, the pleading must be amended accordingly.
(14)

19
Bulawan vs. Aquende (G.R. No. 182819, 22 June 2011).
20
Macababbad vs. Masirag, et al. (G.R. No. 161237, 14 January 2009).
21
Emata vs. Intermediate Appellate Court (G.R. No. L-72714, 29 June 1989).
22
Mabayo Farms, Inc. vs. Court of Appeals (G.R. No. 140058, 1 August 2002).
23
Re: Request of the Plaintiffs, Heirs of the Passengers of the Doña Paz to Set Aside the Order dated January 4, 1877 of
Judge B.D. Chingcuangco (A.M. No. 88-1-646-0, March 3, 1988).
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Section 15.​Entity without juridical personality as defendant​. — When two or more persons not organized
as an entity with juridical personality enter into a transaction, they may be sued under the name by
which they are generally or commonly known.

In the answer of such defendant, the name and addresses of the persons composing said entity must all
be revealed. (15a)

An unincorporated entity cannot sue but may be sued under this section. Although unincorporated, defendant
may be sued as the “Lapanday Group of Companies” because it is generally known with such name.

Section 16. ​Death of party​;​ duty of counsel.​ — Whenever a party to a pending action dies, and the claim
is not thereby extinguished, it shall be the duty of his counsel to inform the court within thirty (30) days
after such death of the fact thereof, and to give the name and address of his legal representative or
representatives. Failure of counsel to comply with his duty shall be a ground for disciplinary action.

The heirs of the deceased may be allowed to be substituted for the deceased, without requiring the
appointment of an executor or administrator and the court may appoint a guardian ​ad litem​ for the minor
heirs.

The court shall forthwith order said legal representative or representatives to appear and be substituted
within a period of thirty (30) days from notice.

If no legal representative is named by the counsel for the deceased party, or if the one so named shall
fail to appear within the specified period, the court may order the opposing party, within a specified time
to procure the appointment of an executor or administrator for the estate of the deceased and the latter
shall immediately appear for and on behalf of the deceased. The court charges in procuring such
appointment, if defrayed by the opposing party, may be recovered as costs. (16a, 17a)

The question as to whether an action survives or not depends on the nature of the action and the damage sued
for. In the causes of action which survive, the wrong complained of affects primarily and principally property and
property rights, the injuries to the person being merely incidental, while in the causes of action which do not
 survive, the injury complained of is to the person, the property and rights of property affected being incidental.If
the case affects primarily and principally property and property rights, then it survives the death of the plaintiff or
petitioner.A Petition for Declaration of Nullity of Deed of Sale of Real Property is one relating to property and
property rights, and therefore, survives the death of the petitioner. A Petition for Annulment of Deed of
Sale, Reconveyance and Damages is also an action that survives the death of the petitioner.If the action
survives despite death of a party, it is the duty of the deceased’s counsel to inform the court of such death, and
to give the names and addresses of the deceased’s legal representatives. The deceased may be substituted by
his heirs in the pending action.If no legal representative is named by the counsel of the deceased, or the legal
representative fails to appear within a specified period, it is the duty of the court where the case is pending to
order the opposing party to procure the appointment of an executor or administrator for the estate of the
deceased. The reason for this rule is to protect all concerned who may be affected by the intervening death,
24
particularly the deceased and his estate.

Under the rules, it is the duty of the​ attorney for the deceased defendant ​to inform the court of his client's death
and to furnish the court with the names and residences of the executor, administrator, or legal representative of
the deceased.​The rules operate on the presumption that the attorney for the deceased party is in a better
position than the attorney for the adverse party to know about the death of his client and to inform the court of
the names and addresses of his legal representative or representatives. Where the attorney for the deceased
defendant did not inform the court of his death, the court may not be faulted for proceeding to render judgment
without ordering the substitution of the deceased defendant. Its judgment is valid and binding upon the
defendant's legal representatives or successors-in-interest, insofar as his interest in the property subject of the
25
action is concerned.

The duty of counsel is to inform the court of the names and addresses of the legal representatives of the
deceased. The "legal representatives" that the provision speaks of, refer to those authorized by law - the
administrator, executor or guardian who, under the rule on settlement of estate of deceased persons,is
constituted to take over the estate of the deceased. Section 16, Rule 3 likewise expressly provides that "​the
heirs of the deceased may be allowed to be substituted for the deceased, without requiring the appointment of
an executor or administrator.” ​The counterclaim co-defendant of the deceased to whom the deceased
transferred his interest in litigation prior to her death is not such “legal representative.” The reason for the Rule
is to protect all concerned who may be affected by the intervening death, particularly the deceased and her
estate. The counterclaim co-defendant, who has a claim against the interest of the deceased, cannot fully

24
Cruz vs. Cruz (G.R. No. 173292, 1 September 2010).
25
Heirs of Regoso vs. CA and Regoso (G.R. No. 91879, 6 July 1992).
 8
26
protect the latter because he has his own interest to protect. An heir who is an adverse party in the case is
27
excluded from representing the deceased.

Section 17. ​Death or separation of a party who is a public officer.​ — When a public officer is a party in
an action in his official capacity and during its pendency dies, resigns, or otherwise ceases to hold
office, the action may be continued and maintained by or against his successor if, within thirty (30) days
after the successor takes office or such time as may be granted by the court, it is satisfactorily shown to
the court by any party that there is a substantial need for continuing or maintaining it and that the
successor adopts or continues or threatens to adopt or continue to adopt or continue the action of his
predecessor. Before a substitution is made, the party or officer to be affected, unless expressly
assenting thereto, shall be given reasonable notice of the application therefor and accorded an
opportunity to be heard. (18a)

Well-settled is the rule that failure to make a substitution pursuant to Section 17, Rule 3 of the Rules of Court is
 a ground for the dismissal of an action.​29​ For the valid substitution of a public officer who has sued or has been
sued in his or her official capacity, the following requisites must be satisfied:

1. Satisfactory proof by any party that there is substantial need for continuing or maintaining
the action;

2. The successor adopts or continues or threatens to adopt or continue the acts of his or her
predecessor;

3. The substitution must be effected within 30 days after the successor assumes office or
within the time granted by the court; and,
28
4. Notice of the application to the other party.

Where the petitioner (a public officer) ceases to be mayor, the appeal and/or action he initiated may be
continued and maintained by his successor if there is substantial need to do so. If the successor failed to
pursue the appeal and/or action, the same should be dismissed. Records show that upon petitioner’s cessation
from public office, his successor did not file any manifestation to the effect that he is continuing and maintaining
29
this appeal. Hence, the appeal should be dismissed.

Section 18. ​Incompetency or incapacity​. — If a party becomes incompetent or incapacitated, the court,
upon motion with notice, may allow the action to be continued by or against the incompetent or
incapacitated person assisted by his legal guardian or guardian ​ad litem​. (19a)

Section 19. ​Transfer of interest.​ — In case of any transfer of interest, the action may be continued by or
against the original party, unless the court upon motion directs the person to whom the interest is
transferred to be substituted in the action or joined with the original party. (20)

The situation contemplated in this Section is different from the situation contemplated in Section 1, Rule 19 of
the Rules of Court, on intervention. ​The purpose of Section 1, Rule 19, on intervention is to enable a stranger to
an action to become a party to protect his interest and the court incidentally to settle all conflicting claims. On
the other hand, the purpose of Section 19, Rule 3, is to provide for the substitution of the transferee ​pendente
lite​ precisely because he is not a stranger but a successor-in-interest of the transferor, who is a party to the
action. As such, a transferee's title to the property is subject to the incidents and results of the pending litigation
and is in no better position than the vendor in whose shoes he now stands.Should the transferee ​pendente
lite c​ hoose to participate in the proceedings, it can only do so as a substituted defendant or as a joint
party-defendant. Because the transferee​ pendente lite​ simply takes the place of the transferor, he is barred
30
from presenting a new or different claim.

The word "may" to denote that the substitution of parties on account of transfer of interest from the original party
31
to another is discretionary. A transferee​ pendente lite​ does not have to be included or impleaded by name in
order to be bound by the judgment because the action or suit may be continued for or against the original party
or the transferor and still be binding on the transferee. ​More specifically, a transferee​ pendente lite​ is a proper
32
party in the case but it is not an indispensable party.

26
Sumaljag vs. Spouses Literato (G.R. No. 149787, 18 June 2008).
27
Ibid.
28
Rodriguez and Yap vs. Jardin (G.R. No. 141834, 30 July 2007).
29
Dagadag vs. Tongnawa and Gammod (G.R. Nos. 161166-67, 3 February 2005).
30
Santiago Land Development Corporation vs. CA (G.R. No. 106194, 28 January 1997).
31
Intestate Estate of the Late Nimfa Sian vs. Philippine National Bank (G.R. No. 168882, 31 January 2007).
32
State Investment House, Inc. vs. CA (G.R. No. 106795, 16 November 1999).
 9

A transferee ​pendente lite​ stands in exactly the same position as its predecessor-in-interest, the original
defendant, and is bound by the proceedings had in the case before the property was transferred to it. It is a
proper but not an indispensable party as it would in any event be bound by the judgment against his
predecessor. This would follow even if it is not formally included as a defendant through an amendment of the
33
complaint.

Section 20. ​Action on contractual money claims​. — When the action is for recovery of money arising
from contract, express or implied, and the defendant dies before entry of final judgment in the court in
which the action was pending at the time of such death, it shall not be dismissed but shall instead be
allowed to continue until entry of final judgment. A favorable judgment obtained by the plaintiff therein
shall be enforced in the manner especially provided in these Rules for prosecuting claims against the
estate of a deceased person. (21a)

The manner provided in the Rules is found in Rule 86 on “Cllaims Against Estate.” Section 5 of said Rule 86
provides that: “All claims for money against the decedent arising from contract, express or implied, whether the
same be due, not due, or contingent, ... 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
34
in any action that the executor or administrator may bring against the claimants….”

Section 21. ​Indigent party​. — A party may be authorized to litigate his action, claim or defense as an
indigent if the court, upon an ​ex parte​ application and hearing, is satisfied that the party is one who has
no money or property sufficient and available for food, shelter and basic necessities for himself and his
family.

Such authority shall include an exemption from payment of docket and other lawful fees, and of
transcripts of stenographic notes which the court may order to be furnished him. The amount of the
docket and other lawful fees which the indigent was exempted from paying shall be a lien on any
judgment rendered in the case favorable to the indigent, unless the court otherwise provides.

Any adverse party may contest the grant of such authority at any time before judgment is rendered by
the trial court. If the court should determine after hearing that the party declared as an indigent is in fact
a person with sufficient income or property, the proper docket and other lawful fees shall be assessed
and collected by the clerk of court. If payment is not made within the time fixed by the court, execution
shall issue or the payment thereof, without prejudice to such other sanctions as the court may impose.
(22a)

Section 19, Rule 141 (“Legal Fees”), of the Rules of Court exempts an indigent from the payment of legal fees if
(a) his gross income and that of their immediate family do not exceed an amount double the monthly minimum
wage of an employee and (b) who do not own real property with a fair market value of more than P300,000.00.
If the applicant for exemption meets the salary and property requirements under Section 19, then the grant of
the application is mandatory. On the other hand, when the application does not satisfy one or both requirements,
then the application should not be denied outright; instead, the court should apply the "indigency test" under
35
Section 21 of Rule 3 and use its sound discretion in determining the merits of the prayer for exemption.

Only a natural party litigant may be regarded as an indigent litigant. The Good Shepherd Foundation, Inc.,
being a corporation invested by the State with a juridical personality separate and distinct from that of its
members, is a juridical person. Among others, it has the power to acquire and possess property of all kinds as
well as incur obligations and bring civil or criminal actions, in conformity with the laws and regulations of their
 
organization.As a juridical person, therefore, it cannot be accorded the exemption from legal and filing fees
granted to indigent litigants. That the Good Shepherd Foundation, Inc. is working for indigent and
underprivileged people is of no moment. Clearly, the Constitution has explicitly premised the free access
36
clause on a person’s poverty, a condition that only a natural person can suffer.

A motion to litigate as an indigent can be made even before the appellate courts, either for the prosecution of
37
appeals, in petitions for review or in special civil actions.

Section 22. ​Notice to the Solicitor General.​ — In any action involving the validity of any treaty, law,
ordinance, executive order, presidential decree, rules or regulations, the court, in its discretion, may

33
Jocson, et al. vs. CA (G.R. No. 88297, 22 March 1990).
34
Gabriel vs. Bilon, et al. (G.R. No. 146989, 7 February 2007).
35
Algura and Algura vs.. The Local Government Unit of the City of Naga, et al. (G.R. No. 150135, 30 October 2006).
36
Re: Query of Mr. Roger C. Prioreschi Re: Exemption from Legal and Filing Fees of the Good Shepherd Foundation, Inc.
(A.M. No. 09-6-9-SC, 19 August 2009).
37
Martinez vs. People of the Philippines (G.R. No. 132852, 31 May 2000).
 10

require the appearance of the Solicitor General who may be heard in person or a representative duly
designated by him. (23a)

The failure to notify the Solicitor General in an action involving the validity of any treaty, etc. is not jurisdictional
inasmuch as the notice is only discretionary on the court.