Rule 1

Rule 1 Sec 4
G.R. No. 180291 July 27, 2010
GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS) and WINSTON F. GARCIA, in his

capacity as PRESIDENT and GENERAL MANAGER of the GSIS, Petitioners,
vs.
DINNAH VILLAVIZA, ELIZABETH DUQUE, ADRONICO A. ECHAVEZ, RODEL RUBIO, ROWENA
THERESE B. GRACIA, PILAR LAYCO, and ANTONIO JOSE LEGARDA, Respondents.
DECISION
MENDOZA, J.:
This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court seeking to reverse and
set aside the August 31, 2007 Decision1 of the Court of Appeals (CA), in CA-G.R. SP No. 98952,
dismissing the petition for certiorari of Government Service Insurance System (GSIS) assailing the
Civil Service Commission's Resolution No. 062177.
THE FACTS:
Petitioner Winston Garcia (PGM Garcia), as President and General Manager of the GSIS, filed
separate formal charges against respondents Dinnah Villaviza, Elizabeth Duque, Adronico A.
Echavez, Rodel Rubio, Rowena Therese B. Gracia, Pilar Layco, and Antonio Jose Legarda for
Grave Misconduct and/or Conduct Prejudicial to the Best Interest of the Service pursuant to the
Rules of Procedure in Administrative Investigation (RPAI) of GSIS Employees and Officials, III, D, (1,
c, f) in relation to Section 52A (3), (20), Rule IV, of the Uniform Rules on Administrative Cases in the
Civil Service (URACCS), in accordance with Book V of the Administrative Code of 1987, committed
as follows:
That on 27 May 2005, respondent, wearing red shirt together with some employees, marched to or
appeared simultaneously at or just outside the office of the Investigation Unit in a mass
demonstration/rally of protest and support for Messrs. Mario Molina and Albert Velasco, the latter
having surreptitiously entered the GSIS premises;
x x x x x x x x x
That some of these employees badmouthed the security guards and the GSIS management and
defiantly raised clenched fists led by Atty. Velasco who was barred by Hearing Officer Marvin R.
Gatpayat in an Order dated 24 May 2005 from appearing as counsel for Atty. Molina pursuant to
Section 7 (b) (2) of R.A. 6713 otherwise known as the Code of Conduct and Ethical Standards for
Public Officials and Employees;
That respondent, together with other employees in utter contempt of CSC Resolution No. 021316,
dated 11 October 2002, otherwise known as Omnibus Rules on Prohibited Concerted Mass Actions
in the Public Sector caused alarm and heightened some employees and disrupted the work at the
Investigation Unit during office hours.2
This episode was earlier reported to PGM Garcia, through an office memorandum dated May 31,
2005, by the Manager of the GSIS Security Department (GSIS-SD), Dennis Nagtalon. On the same
day, the Manager of the GSIS Investigation Unit (GSIS-IU), Atty. Lutgardo Barbo, issued a
memorandum to each of the seven (7) respondents requiring them to explain in writing and under
oath within three (3) days why they should not be administratively dealt with.3
Respondents Duque, Echavez, Rubio, Gracia, Layco, and Legarda, together with two others,
submitted a letter-explanation to Atty. Barbo dated June 6, 2005. Denying that there was a planned
mass action, the respondents explained that their act of going to the office of the GSIS-IU was a
spontaneous reaction after learning that their former union president was there. Aside from some of
them wanting to show their support, they were interested in that hearing as it might also affect them.
For her part, respondent Villaviza submitted a separate letter explaining that she had a scheduled
pre-hearing at the GSIS-IU that day and that she had informed her immediate supervisor about it,
attaching a copy of the order of pre-hearing. These letters were not under oath.4
PGM Garcia then filed the above-mentioned formal charges for Grave Misconduct and/or Conduct
Prejudicial to the Best Interest of the Service against each of the respondents, all dated June 4,
2005. Respondents were again directed to submit their written answers under oath within three (3)
days from receipt thereof.5 None was filed.
On June 29, 2005, PGM Garcia issued separate but similarly worded decisions finding all seven (7)
respondents guilty of the charges and meting out the penalty of one (1) year suspension plus the
accessory penalties appurtenant thereto.
On appeal, the Civil Service Commission (CSC) found the respondents guilty of the lesser offense of
Violation of Reasonable Office Rules and Regulations and reduced the penalty to reprimand. The
CSC ruled that respondents were not denied their right to due process but there was no substantial
evidence to hold them guilty of Conduct Prejudicial to the Best Interest of the Service. Instead,
x x x. The actuation of the appellants in going to the IU, wearing red shirts, to witness a public
hearing cannot be considered as constitutive of such offense. Appellants' (respondents herein)
assembly at the said office to express support to Velasco, their Union President, who pledged to
defend them against any oppression by the GSIS management, can be considered as an exercise of
their freedom of expression, a constitutionally guaranteed right.6 x x x
PGM Garcia sought reconsideration but was denied. Thus, PGM Garcia went to the Court of
Appeals via a Petition for Review under Rule 43 of the Rules on Civil Procedure.7 The CA upheld the
CSC in this wise:
The Civil Service Commission is correct when it found that the act sought to be punished hardly falls
within the definition of a prohibited concerted activity or mass action. The petitioners failed to prove
that the supposed concerted activity of the respondents resulted in work stoppage and caused
prejudice to the public service. Only about twenty (20) out of more than a hundred employees at the
main office, joined the activity sought to be punished. These employees, now respondents in this
case, were assigned at different offices of the petitioner GSIS. Hence, despite the belated claim of
the petitioners that the act complained of had created substantial disturbance inside the petitioner
GSIS' premises during office hours, there is nothing in the record that could support the claim that
the operational capacity of petitioner GSIS was affected or reduced to substantial percentage when
respondents gathered at the Investigation Unit. Despite the hazy claim of the petitioners that the
gathering was intended to force the Investigation Unit and petitioner GSIS to be lenient in the
handling of Atty. Molina's case and allow Atty. Velasco to represent Atty. Molina in his administrative
case before petitioner GSIS, there is likewise no concrete and convincing evidence to prove that the
gathering was made to demand or force concessions, economic or otherwise from the GSIS
management or from the government. In fact, in the separate formal charges filed against the
respondents, petitioners clearly alleged that respondents "marched to or appeared simultaneously at
or just outside the office of the Investigation Unit in a mass demonstration/rally of protest and
support for Mssrs. Mario Molina and Albert Velasco, the latter surreptitiously entered the GSIS
premises." Thus, petitioners are aware at the outset that the only apparent intention of the
respondents in going to the IU was to show support to Atty. Mario Molina and Albert Velasco, their
union officers. The belated assertion that the intention of the respondents in going to the IU was to
disrupt the operation and pressure the GSIS administration to be lenient with Atty. Mario Molina and
Albert Velasco, is only an afterthought.8
Not in conformity, PGM Garcia is now before us via this Petition for Review presenting the following:
STATEMENT OF THE ISSUES
WHETHER AN ADMINISTRATIVE TRIBUNAL MAY APPLY SUPPLETORILY THE PROVISIONS

OF THE RULES OF COURT ON THE EFFECT OF FAILURE TO DENY THE ALLEGATIONS IN
THE COMPLAINT AND FAILURE TO FILE ANSWER, WHERE THE RESPONDENTS IN THE
ADMINISTRATIVE PROCEEDINGS DID NOT FILE ANY RESPONSIVE PLEADING TO THE
FORMAL CHARGES AGAINST THEM.
II
WHETHER THE RULE THAT ADMINISTRATIVE DUE PROCESS CANNOT BE EQUATED WITH
DUE PROCESS IN JUDICIAL SENSE AUTHORIZES AN ADMINISTRATIVE TRIBUNAL TO
CONSIDER IN EVIDENCE AND GIVE FULL PROBATIVE VALUE TO UNNOTARIZED LETTERS
THAT DID NOT FORM PART OF THE CASE RECORD.
III
WHETHER A DECISION THAT MAKES CONCLUSIONS OF FACTS BASED ON EVIDENCE ON

RECORD BUT MAKES A CONCLUSION OF LAW BASED ON THE ALLEGATIONS OF A
DOCUMENT THAT NEVER FORMED PART OF THE CASE RECORDS IS VALID.
IV
WHETHER FURTHER PROOF OF SUSBTANTIAL REDUCTION OF THE OPERATIONAL

CAPACITY OF AN AGENCY, DUE TO UNRULY MASS GATHERING OF GOVERNMENT
EMPLOYEES INSIDE OFFICE PREMISES AND WITHIN OFFICE HOURS, IS REQUIRED TO
HOLD THE SAID EMPLOYEES LIABLE FOR CONDUCT PREJUDICIAL TO THE BEST INTEREST
OF THE SERVICE PURSUANT TO CSC RESOLUTION NO. 021316.
WHETHER AN UNRULY MASS GATHERING OF TWENTY EMPLOYEES, LASTING FOR MORE

THAN AN HOUR DURING OFFICE HOURS, INSIDE OFFICE PREMISES AND WITHIN A UNIT
TASKED TO HEAR AN ADMINISTRATIVE CASE, TO PROTEST THE PROHIBITION AGAINST
THE APPEARANCE OF THEIR LEADER AS COUNSEL IN THE SAID ADMINISTRATIVE CASE,
FALLS WITHIN THE PURVIEW OF THE CONSTITUTIONAL GUARANTEE TO FREEDOM OF
EXPRESSION AND PEACEFUL ASSEMBLY.
VI
WHETHER THE CONCERTED ABANDONMENT OF EMPLOYEES OF THEIR POSTS FOR MORE

THAN AN HOUR TO HOLD AN UNRULY PROTEST INSIDE OFFICE PREMISES ONLY
CONSTITUTES THE ADMINISTRATIVE OFFENSE OF VIOLATION OF REASONABLE OFFICE
RULES AND REGULATIONS.9
The Court finds no merit in the petition.
Petitioners primarily question the probative value accorded to respondents' letters of explanation in
response to the memorandum of the GSIS-IU Manager. The respondents never filed their answers
to the formal charges. The petitioners argue that there being no answers, the allegations in the
formal charges that they filed should have been deemed admitted pursuant to Section 11, Rule 8 of
the Rules of Court which provides:
SECTION 11. Allegations not specifically denied deemed admitted.- Material averment in the
complaint, other than those as to the amount of liquidated damages, shall be deemed admitted when
not specifically denied. Allegations of usury in a complaint to recover usurious interest are deemed
admitted if not denied specifically and under oath.
According to the petitioners, this rule is applicable to the case at bench pursuant to Rule 1, Section 4
of the Rules of Court which reads:
SECTION 4. In what cases not applicable. - These Rules shall not apply to election cases, land
registration, cadastral, naturalization and insolvency proceedings, and other cases not herein
provided for, except by analogy or in a suppletory character and whenever practicable and
convenient. (underscoring supplied)
The Court does not subscribe to the argument of the petitioners. Petitioners' own rules, Rule XI,
Section 4 of the GSIS' Amended Policy and Procedural Guidelines No. 178-04, specifically provides:
If the respondent fails to file his Answer within five (5) working days from receipt of the Formal
Charge for the supporting evidence, when requested, he shall be considered to have waived his
right to file an answer and the PGM or the Board of Trustees, in proper cases, shall render
judgment, as may be warranted by the facts and evidence submitted by the prosecution.
A perusal of said section readily discloses that the failure of a respondent to file an answer merely
translates to a waiver of "his right to file an answer." There is nothing in the rule that says that the
charges are deemed admitted. It has not done away with the burden of the complainant to prove the
charges with clear and convincing evidence.
It is true that Section 4 of the Rules of Court provides that the rules can be applied in a "suppletory
character." Suppletory is defined as "supplying deficiencies."10 It means that the provisions in the
Rules of Court will be made to apply only where there is an insufficiency in the applicable rule. There
is, however, no such deficiency as the rules of the GSIS are explicit in case of failure to file the
required answer. What is clearly stated there is that GSIS may "render judgment as may be
warranted by the facts and evidence submitted by the prosecution."
Even granting that Rule 8, Section 11 of the Rules of Court finds application in this case, petitioners
must remember that there remain averments that are not deemed admitted by the failure to deny the
same. Among them are immaterial allegations and incorrect conclusions drawn from facts set out in
the complaint.11 Thus, even if respondents failed to file their answer, it does not mean that all
averments found in the complaint will be considered as true and correct in their entirety, and that the
forthcoming decision will be rendered in favor of the petitioners. We must not forget that even in
administrative proceedings, it is still the complainant, or in this case the petitioners, who have the
burden of proving, with substantial evidence, the allegations in the complaint or in the formal
charges.12
A perusal of the decisions of the CA and of the CSC will reveal that the case was resolved against
petitioners based, not on the absence of respondents' evidence, but on the weakness of that of the
petitioners. Thus, the CA wrote:
Petitioners correctly submitted the administrative cases for resolution without the respondents'
respective answer to the separate formal charges in accordance with Section 4, Rule XI of the RPAI.
Being in full control of the administrative proceeding and having effectively prevented respondents
from further submitting their responsive answer and evidence for the defense, petitioners were in the
most advantageous position to prove the merit of their allegations in the formal charges. When
petitioner Winston Garcia issued those similarly worded decisions in the administrative cases
against the respondents, it is presumed that all evidence in their favor were duly submitted and justly
considered independent of the weakness of respondent's evidence in view of the principle that ''the
burden of proof belongs to the one who alleges and not the one who denies."13
On the merits, what needs to be resolved in the case at bench is the question of whether or not there
was a violation of Section 5 of CSC Resolution No. 02-1316. Stated differently, whether or not
respondents' actions on May 27, 2005 amounted to a "prohibited concerted activity or mass action."
Pertinently, the said provision states:
Section 5. As used in this Omnibus Rules, the phrase ''prohibited concerted activity or mass action''
shall be understood to refer to any collective activity undertaken by government employees, by
themselves or through their employees organizations, with intent of effecting work stoppage or
service disruption in order to realize their demands of force concession, economic or otherwise, from
their respective agencies or the government. It shall include mass leaves, walkouts, pickets and acts
of similar nature. (underscoring supplied)
In this case, CSC found that the acts of respondents in going to the GSIS-IU office wearing red shirts
to witness a public hearing do not amount to a concerted activity or mass action proscribed above.
CSC even added that their actuations can be deemed an exercise of their constitutional right to
freedom of expression. The CA found no cogent reason to deviate therefrom.
As defined in Section 5 of CSC Resolution No. 02-1316 which serves to regulate the political rights
of those in the government service, the concerted activity or mass action proscribed must be
coupled with the "intent of effecting work stoppage or service disruption in order to realize their
demands of force concession." Wearing similarly colored shirts, attending a public hearing at the
GSIS-IU office, bringing with them recording gadgets, clenching their fists, some even badmouthing
the guards and PGM Garcia, are acts not constitutive of an (i) intent to effect work stoppage or
service disruption and (ii) for the purpose of realizing their demands of force concession.
Precisely, the limitations or qualifications found in Section 5 of CSC Resolution No. 02-1316 are
there to temper and focus the application of such prohibition. Not all collective activity or mass
undertaking of government employees is prohibited. Otherwise, we would be totally depriving our
brothers and sisters in the government service of their constitutional right to freedom of expression.
Government workers, whatever their ranks, have as much right as any person in the land to voice
out their protests against what they believe to be a violation of their rights and interests. Civil Service
does not deprive them of their freedom of expression. It would be unfair to hold that by joining the
government service, the members thereof have renounced or waived this basic liberty. This freedom
can be reasonably regulated only but can never be taken away.
A review of PGM Garcia's formal charges against the respondents reveals that he himself was not
even certain whether the respondents and the rest of the twenty or so GSIS employees who were at
the GSIS-IU office that fateful day marched there or just simply appeared there
simultaneously.14 Thus, the petitioners were not even sure if the spontaneous act of each of the
twenty or so GSIS employees on May 27, 2005 was a concerted one. The report of Manager
Nagtalon of the GSIS-SD which was the basis for PGM Garcia's formal charges reflected such
uncertainty. Thus,
Of these red shirt protesters, only Mr. Molina has official business at the Investigation Unit during
this time. The rest abandoned their post and duties for the duration of this incident which lasted until
10:55 A.M. It was also observed that the protesters, some of whom raised their clenched left fists,
carefully planned this illegal action as evident in their behavior of arrogance, defiance and
provocation, the presence of various recording gadgets such as VCRs, voice recorders and digital
cameras, the bad mouthing of the security guards and the PGM, the uniformity in their attire and the
collusion regarding the anomalous entry of Mr. Albert Velasco to the premises as reported earlier.15
The said report of Nagtalon contained only bare facts. It did not show respondents' unified intent to
effect disruption or stoppage in their work. It also failed to show that their purpose was to demand a
force concession.
In the recent case of GSIS v. Kapisanan ng mga Manggagawa sa GSIS,16 the Court upheld the
position of petitioner GSIS because its employees, numbering between 300 and 800 each day,
staged a walkout and participated in a mass protest or demonstration outside the GSIS for four
straight days. We cannot say the same for the 20 or so employees in this case. To equate their
wearing of red shirts and going to the GSIS-IU office for just over an hour with that four-day mass
action in Kapisanan ng mga Manggagawa sa GSIS case and to punish them in the same manner
would most certainly be unfair and unjust.
Recent analogous decisions in the United States, while recognizing the government's right as an
employer to lay down certain standards of conduct, tend to lean towards a broad definition of "public
concern speech" which is protected by their First Amendment. One such case is that of Scott v.
Meters.17 In said case, the New York Transit Authority (NYTA), responsible for operation of New York
City's mass transit service, issued a rule prohibiting employees from wearing badges or buttons on
their uniforms. A number of union members wore union buttons promoting their opposition to a
collective bargaining agreement. Consequently, the NYTA tried to enforce its rule and threatened to
subject these union members to discipline. The court, though recognizing the government's right to
impose reasonable restrictions, held that the NYTA's rule was "unconstitutionally overboard."
In another case, Communication Workers of America v. Ector County Hospital District,18 it was held
that,
A county hospital employee's wearing of a "Union Yes" lapel pin during a union organization drive
constituted speech on a matter of public concern, and the county's proffered interest in enforcing the
anti-adornment provision of its dress code was outweighed by the employee's interest in exercising
his First Amendment speech and associational rights by wearing a pro-union lapel button.19
Thus, respondents' freedom of speech and of expression remains intact, and CSC's Resolution No.
02-1316 defining what a prohibited concerted activity or mass action has only tempered or regulated
these rights. Measured against that definition, respondents' actuations did not amount to a prohibited
concerted activity or mass action. The CSC and the CA were both correct in arriving at said
conclusion.
WHEREFORE, the assailed August 31, 2007 Decision of the Court of Appeals as well as its October
16, 2007 Resolution in CA G.R. SP No. 98952 are hereby AFFIRMED.
SO ORDERED.
RENATO REYES, REPRESENTED BY RAMON REYES, PETITIONER, VS. LEOPOLDO

BARRIOS, SUBSTITUTED BY LUCIA MANALUS-BARRIOS, RESPONDENT.
The Case
This petition for review[1] assails the 8 February 2006 Decision[2] and the 29 May 2006
Resolution[3] of the Court of Appeals in CA-G.R. SP No. 90212. The Court of Appeals
affirmed the 29 June 1998 Decision and the 7 December 2004 Resolution of the
Department of Agrarian Reform Adjudication Board (DARAB) in DARAB Case No. 5504,
declaring Leopoldo Barrios as bona fide tenant of the subject landholding. The DARAB
reversed the 31 October 1996 Decision of the Provincial Agrarian Reform Board
(PARAD) of San Fernando, Pampanga.
The Facts
On 26 September 1995, petitioner Renato Reyes (petitioner) filed before the
Department of Agrarian Reform, Region III, PARAD of San Fernando, Pampanga, a
complaint for ejectment against respondent Leopoldo Barrios (respondent). The case
was docketed as DARAB CASE No. 1089-P'95.
The case involves a parcel of land measuring approximately 3.6 hectares (landholding)
[4]
which forms part of the property with an aggregate area of 527,695 square meters
(property)[5] located at Mapaniqui, Candaba, Pampanga covered by Transfer Certificate
of Title (TCT) No. 14488.[6] The property was co-owned by petitioner and his four
sisters.[7] Petitioner claimed that the property became subject of the Operation Land
Transfer under Presidential Decree No. 27 (PD 27), except the 3.6â€’hectare
landholding which was allegedly retained. In his Memorandum [8] dated 18 September
2007, petitioner averred that he and his sister Leticia V. Reyes are the co-owners of the
landholding. Petitioner hired respondent as the overseer of the farm and piggery on the
landholding. However, petitioner contended that respondent never remitted the
proceeds from the piggery business and the fruits from the landholding. [9]
On the other hand, respondent alleged that he was a tenant of the landholding since
1972 and he even built his house on the subject landholding. Respondent also acted as
the caretaker of the piggery business on the landholding. Contrary to petitioner's
allegations, respondent stated that petitioner's wife took all the proceeds from the
piggery business, which later ceased operation due to an epidemic.
When respondent failed to appear during the scheduled hearings, petitioner moved to
submit the case for decision on the basis of the evidence presented. Respondent
alleged that his failure to attend the scheduled hearings was because he received the
Notice for the 29 February 1996 hearing only on 6 March 1996. Respondent moved for
the postponement of the hearing because he was bedridden due to hypertension and
heart ailment.[10] However, the PARAD again heard the case ex-parte on 28 March
1996, of which respondent alleged that he was still not notified.
On 31 October 1996, the PARAD rendered a decision, the dispositive portion of which
reads:
WHEREFORE, premises considered, this Office renders judgment declaring that herein
plaintiff [Renato Reyes] is entitled to recover the possession of the property subject of
this present litigation; ordering the defendant [Leopoldo Barrios] or anyone claiming
any right or authority under him to vacate the premises in question and surrender
possession thereof to the plaintiff; and ordering the defendant to pay the sum of
P3,000.00 to the plaintiff as attorney's fees.
No pronouncement as to cost.
SO ORDERED.[11]
Respondent appealed to the DARAB. Meanwhile, respondent passed away on 13

February 1997[12] and was substituted by his spouse Lucia Manalus-Barrios.[13]
On 29 June 1998, the DARAB reversed the PARAD decision and held that respondent is
a bona fide tenant of the landholding and that he cannot be ejected from the
landholding absent any justifiable cause. The DARAB held:
It appears that Respondent-Appellant is listed as farmer-beneficiary of the land transfer

program, as evidenced by the Certification issued by the Officer-in-charge of Arayat-
Sta. Ana-Candaba Agrarian Reform Team. The fact of tenancy is buttressed by the joint
statement dated March 5, 1989 of residents of neighboring lots who attest to
Respondent-Appellant's cultivation of subject lot. As tenant thereon, Respondent-
Appellant, therefore, cannot just be ejected. The causes for extinguishment of
Leasehold Relation pursuant to Section 36, Republic Act No. 6657 are:
1. Abandonment of the landholding without the knowledge of the lessor;
2. Voluntary surrender of the landholding by the lessee, written notice of which shall be
served three (3) months in advance;
3. Absence of successor or qualified heir, in case of death or permanent incapacity of

the lessee;
4. Judicial ejectment of the lessee for causes provided under Sec. 36 of the Code;
5. Acquisition by the lessee of the landholding;
6. Termination of the leasehold under Sec. 38;
7. Mutual consent of the parties; and
8. Conversion of the landholding for non-agricultural purposes subject to the conditions

required by law.
The records are bereft of evidence showing the existence of any of the above-quoted
circumstances to justify ejectment of Respondent-Appellant from said landholding.
Under the prevailing circumstances, we hold that Respondent-Appellant Barrios is a

bona fide tenant of the landholding.
WHEREFORE, premises considered, the appealed decision is SET ASIDE, and a new one
entered:
1. Declaring Respondent-Appellant Leopoldo Barrios a bona fide tenant of

the subject landholding. However, due to his death during the pendency
of this case, the surviving spouse, if qualified, shall succeed; if not, the
eldest descendant will succeed or the descending descendant in the order
of their age;
2. Directing the plaintiff-landowner Renato Reyes to reinstate the qualified

heir of Respondent-Appellant and to maintain him in peaceful possession
as cultivator thereof; and
3. Directing the DAR Regional Office, through its Municipal Agrarian Reform
Officer (MARO) to issue Certificate of Agricultural Lease (CAL) after fixing
the lease rental therefor.
SO ORDERED.[14]
Petitioner filed a Motion for Reconsideration, asking for the reversal of the DARAB
decision and the reinstatement of the PARAD decision. Respondent, substituted by his
spouse Lucia Manalus-Barrios, also filed a Motion for Partial Reconsideration, asking for
the modification of the decision by declaring respondent as a beneficiary under PD 27
and to issue an Emancipation Patent in favor of respondent's surviving spouse Lucia
Manalus-Barrios.
In its 7 December 2004 Resolution, the DARAB denied petitioner's Motion for
Reconsideration for lack of merit and granted respondent's Motion for Partial
Reconsideration, thus:
In the Motion for Partial Reconsideration, Movant alleged that this Board in its decision
has declared that the deceased Defendant-Appellant Leopoldo Barrios is a bona fide
tenant on the subject landholding. Moreover, Plaintiff-Appellee maintains that page
three (3) of the decision rendered by this Board finds and provides that "Operation
Land Transfer (OLT) or Presidential Decree No. 27 was signed into law decreeing the
emancipation of tenants from the bondage of the soil, transferring to them the
ownership of the land they till and providing the instruments and mechanisms
therefore." Hence, movant prayed that an Emancipation Patent be issued in lieu of the
Certificate of Agricultural Lease in consonance with the findings of this Board and DAR
Administrative Order No. 13, Series of 1988.
Acting on said motion, this Board finds that the appealed decision shows substantial
appreciation that deceased Defendant-Appellant was a bona fide tenant on the subject
landholding. Likewise, this Board, in the assailed decision sustained the provisions of
Presidential Decree No. 27, providing "the emancipation of tenants from the bondage of
the soil . . ."
From the foregoing findings, the pronouncement of this Board specifically paragraph
three (3) of the decision seeks modification. In finding that deceased Defendant-
Appellant was a bona fide tenant of the subject landholding and declaring the
emancipation of tenants from the bondage of the soil, the subsequent issuance of a
Certificate of Agricultural Lease as provided in the assailed decision is not in
consonance with the findings of the Board. Hence, this Board is constrained to modify
or apply the correct conclusions drawn from the facts of the case.
WHEREFORE, premises considered, the herein Motion for Reconsideration dated

September 30, 1995 is hereby DENIED for lack of merit. Whereas, the Motion for Partial
Reconsideration dated October 5, 1998 is GRANTED and a new judgment is rendered,
as follows:
1. Paragraph three (3) of the decision dated June 29, 1998 is hereby
modified;
2. Directing the DAR Regional Director, through the Municipal Agrarian

Reform Officer (MARO), to issue Emancipation Patent in favor of
Defendant-Appellant or his heir, herein substitute Defendant-Appellant
Lucia Manalus-Barrios;
3. Directing Plaintiff-Appellee's successors, co-owners, and the alleged

former tenants and all those persons acting on their behalf to vacate the
subject landholding and to immediately reinstate the substitute
Defendant-Appellant thereto and to maintain her in peaceful possession
thereof;
4. Declaring the landholding fully paid by the defendant-appellant;
5. Directing the Plaintiff-Appellee's successors and co-owners to reimburse

75% of palay harvest, of its cash equivalent, on the remaining 12Â½
croppings to the Defendant-Appellant and deducting therefrom the
amount of the expenses incurred by the Plaintiff-Appellee's successors
and co-owners in the present planting season.
Let records of this case be remanded to the Sala of the Honorable Provincial Adjudicator
of Pampanga for the immediate issuance of a writ of execution.
SO ORDERED.[15]
Petitioner filed another Motion for Reconsideration, which the DARAB denied in its
Resolution dated 5 May 2005.[16] Petitioner then appealed to the Court of Appeals,
which denied the petition for review in its 8 February 2006 Decision. The Court of
Appeals likewise denied petitioner's motion for reconsideration in its 29 May 2006
Resolution.
Hence, this petition for review.
The Ruling of the Court of Appeals
The Court of Appeals concurred with the findings of the DARAB, thus:
But the petitioner insists that public respondent decided the case at bench against him
in defiance of the evidence on record. We do not agree. The DARAB based its findings
on the certification dated December 7, 1982 of then Ministry of Agrarian Reform (now
Department of Agrarian Reform) of Sta. Ana, Pampanga finding Leopoldo Barrios as
legitimate farmer-beneficiary over a four (4) hectare unirrigated land owned by Renato
Reyes, located at Mapaniqui, Candaba, Pampanga; on the certification issued by the
Officer-in-charge of Arayat-Sta. Ana-Candaba Agrarian Reform Team listing
respondent-appellant as farmer-beneficiary; and on the joint statement dated March 5,
1989 of residents of neighboring lots who attested to respondent-appellant's cultivation
and occupation of the subject lot.
It bears stressing that in administrative proceedings, as in the case at bench, the

quantum of evidence required to sustain a judgment is only substantial evidence. It is
such relevant evidence as a reasonable mind might accept as adequate to support a
conclusion, even if other minds equally reasonable might conceivably opine differently.
Thus, findings of fact of quasi-judicial agencies are generally accorded respect, and
even finality, by the appellate tribunal, if supported by substantial evidence, this in
recognition of their expertise on the specific matters under their consideration. [17]
The Issues
In his petition, petitioner submits that:
1. THE COURT OF APPEALS BY RULING IN ITS QUESTIONED DECISION

(ANNEX "A") THAT THE DARAB WAS CORRECT IN DECIDING THE CASE
AGAINST HIM AS THIS IS SUPPORTED BY THE CERTIFICATIONS ISSUED
BY THE MINISTRY OF AGRARIAN REFORM AND THE OFFICER-IN-CHARGE
OF THE AGRARIAN REFORM TEAM OF ARAYAT-STA. ANA-CANDABA,
PAMPANGA DENIED PETITIONER HIS RIGHT TO DUE PROCESS OF LAW
AND COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK
OR EXCESS OF JURISDICTION BECAUSE THE RECORD SHOWS THAT NOT
ONLY ARE THE EVIDENCE OF BARRIOS IRRELEVANT BUT THEY [ARE]
ALSO MERE MACHINE COPIES WHICH WERE NEVER PRESENTED IN A
PROPER HEARING WHERE THE PETITIONER CAN SCRUTINIZE THEM AND
CROSS-EXAMINE PRIVATE RESPONDENT ON THEM.
2. THE COURT OF APPEALS COMMITTED GRIEVOUS LEGAL ERROR AND/OR

GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF
JURISDICTION BY FAILING TO CORRECT THE DARAB IN NOT
RECOGNIZING PETITIONER'S RIGHT OVER HIS RETAINED AREA WHICH
HAD ALREADY BEEN THE SUBJECT OF AN AWARD IN CLAIM 83-144 OF
LAND BANK OF THE PHILIPPINES.[18]
The Ruling of the Court
We partially grant the petition. We hold that respondent is a bona fide tenant of the
subject landholding, as stated in the 29 June 1998 DARAB Decision in DARAB Case No.
5504. However, the 7 December 2004 DARAB Resolution, modifying the 29 June 1998
DARAB Decision and directing the DAR Regional Director to issue Emancipation Patent
in favor of respondent or his heirs, should be set aside.
In this case, the DARAB ruling that respondent is a bona fide tenant is supported by
evidence submitted by respondent, which included: (1) certification dated 7 December
1982 of the Arayat-Sta. Ana-Candaba Agrarian Reform Team, Ministry of Agrarian
Reform, Region III, Pampanga District, stating that respondent is a bona fide farmer-
beneficiary under the Operation Land Transfer of the four (4)-hectare farmholding
owned by petitioner;[19] (2) joint statement ("Salaysay") dated 5 March 1989 of the
former farmworkers of the neighboring farmlots attesting to respondent's occupation
and cultivation of the subject landholding; [20] (3) pictures of the subject landholding
which was planted with palay crops;[21] and (4) picture of respondent's house
constructed on the subject landholding. [22]
Furthermore, in compliance with the Order[23] dated 30 September 2002 of the DARAB,

the Provincial Agrarian Reform Officer (PARO) of Pampanga forwarded to the DARAB
the status report on the subject landholding,[24] which states:
Republic of the Philippines

DEPARTMENT OF AGRARIAN REFORM
Region III
Municipal Agrarian Reform Office
Candaba, Pampanga
Engr. Rodolfo S. Pangilinan

OIC-PARO
DARPO-Del Pilar,
City of San Fernando Pampanga
Sir:
This refers to the Order dated September 30, 2002 issued by DARCO Appeal Board with
the instruction to submit status report of the subject landholding owned by Renato
Reyes located at Mapanique, Candaba, Pampanga.
That the undersigned conducted ocular inspection/verification and reveal the following
finding to wit:
1. That Renato Reyes the landowner and Leopoldo Barrios tenant are both

deceased.
2. That the subject landholding was taken over by Renato Reyes since 1996
and it is being administered by Antonio Manalus.
3. That at present the land in question is planted to palay by the

administrator Antonio Manalus with the used (sic) of farm labor and 30
mango tree[s] are existing of the subject landholding.
4. That the house of Lucia Vda. De Barrios was constructed to the

subject landholding with an area of 450 square meters more or less.
5. That the qualified tenant beneficiaries [are] among the surviving

heirs of Leopoldo Barrios is the wife of (sic) Lucia Vda. M. Barrios.
In view of the foregoing facts and base[d] on the Order dated September 30, 2002[,]
[t]he undersigned schedule[d] mediation conference on November 18, 2002 in
preparation of the Certificate of Agricultural Leasehold.
Very truly yours,
(signed)
SALVADOR S. TOTAAN
M.A.R.O.[25]
Under Section 3, Rule I of the 1994 DARAB New Rules of Procedure (now Section 3,
Rule I of the 2009 DARAB Rules of Procedure [26]), the Board and its Regional and
Provincial Adjudicators are not bound by technical rules of procedure and evidence,
thus:
SECTION 3. Technical Rules Not Applicable. The Board and its Regional and Provincial
Adjudicators shall not be bound by technical rules of procedure and evidence as
prescribed in the Rules of Court, but shall proceed to hear and decide all agrarian
cases, disputes or controversies in a most expeditious manner, employing all
reasonable means to ascertain the facts of every case in accordance with justice and
equity.
xxx
c) The provisions of the Rules of Court shall not apply even in suppletory character
unless adopted herein or by resolution of the Board. However, due process of law shall
be observed and followed in all instances.
Section 1, Rule VIII of the 1994 DARAB New Rules of Procedure (now Section 1, Rule X
of the 2009 DARAB Rules of Procedure[27]) reiterates the non-applicability of technical
rules regarding the admission and sufficiency of evidence, thus:
SECTION 1. Nature of Proceedings. The proceedings before the Board or its

Adjudicators shall be non-litigious in nature. Subject to the essential requirements of
due process, the technicalities of law and procedures and the rules governing the
admissibility and sufficiency of evidence obtained in the courts of law shall not apply. x
xx
Thus, in Reyes v. Court of Appeals,[28] the Court held:
Finally, we rule that the trial court did not err when it favorably considered the
affidavits of Eufrocina and Efren Tecson (Annexes "B" and "C") although the affiants
were not presented and subjected to cross-examination. Section 16 of P.D. No. 946
provides that `Rules of Court shall not be applicable in agrarian cases even in a
suppletory character.' The same provision states that `In the hearing, investigation and
determination of any question or controversy, affidavits and counter-affidavits may be
allowed and are admissible in evidence.'[29]
Besides, the DARAB Rules should be liberally construed to carry out the objectives of
agrarian reform and to promote just, expeditious, and inexpensive adjudication and
settlement of agrarian cases, disputes or controversies. [30]
Although we affirm the ruling of the DARAB that respondent is a bona fide tenant, we
disagree with its order for the issuance of an Emancipation Patent in favor of
respondent's heir, as provided in its Resolution dated 7 December 2004. The records
show that when the property was placed under the Operation Land Transfer,
respondent was not included in the list of tenant beneficiaries who were issued
Emancipation Patents, as noted on the title of the property, TCT No. 14488, which was
partially canceled in view of the issuance of the new TCTs in favor of the tenant
beneficiaries.[31]
The Primer on Agrarian Reform[32] enumerates the steps in transferring the land to the
tenant-tiller, thus:
a. First step: the identification of tenants, landowners, and the land covered by OLT.
b. Second step: land survey and sketching of the actual cultivation of the tenant to
determine parcel size, boundaries, and possible land use;
c. Third step: the issuance of the Certificate of Land Transfer (CLT). To ensure accuracy
and safeguard against falsification, these certificates are processed at the National
Computer Center (NCC) at Camp Aguinaldo;
d. Fourth step: valuation of the land covered for amortization computation;
e. Fifth step: amortization payments of tenant-tillers over fifteen (15) year period; and
f. Sixth step: the issuance of the Emancipation Patent. [33]
Thus, there are several steps to be undertaken before an Emancipation Patent can be
issued. As regards respondent, the records are bereft of evidence indicating that this
procedure has been followed.
Furthermore, there are several supporting documents which a tenant-farmer must

submit before he can receive the Emancipation Patent, such as:
a. Application for issuance of Emancipation Patent;
b. Applicant's (owner's) copy of Certificate of Land Transfer.

c. Certification of the landowner and the Land Bank of the Philippines that the applicant
has tendered full payment of the parcel of land as described in the application and as
actually tilled by him;
d. Certification by the President of the Samahang Nayon or by the head of farmers'

cooperative duly confirmed by the municipal district officer (MDO) of the Ministry of
Local Government and Community Development (MLGCD) that the applicant is a full-
fledged member of a duly registered farmers' cooperative or a certification to these
effect;
e. Copy of the technical (graphical) description of the land parcel applied for prepared
by the Bureau of Land Sketching Team (BLST) and approved by the regional director of
the Bureau of Lands;
f. Clearance from the MAR field team (MARFT)or the MAR District Office (MARDO) legal
officer or trial attorney; or in their absence, a clearance by the MARFT leader to the
effect that the land parcel applied for is not subject of adverse claim, duly confirmed by
the legal officer or trial attorney of the MAR Regional Office or, in their absence, by the
regional director;
g. Xerox copy of Official Receipts or certification by the municipal treasurer showing

that the applicant has fully paid or has effected up-to-date payment of the realty taxes
due on the land parcel applied for; and
h. Certification by the MARFT leader whether applicant has acquired farm machineries
from the MAR and/or from other government agencies.[34]
Majority of these supporting documents are lacking in this case. Hence, it was improper
for the DARAB to order the issuance of the Emancipation Patent in favor of respondent
without the required supporting documents and without following the requisite
procedure before an Emancipation Patent may be validly issued.
Moreover, there was no sufficient evidence to prove that respondent has fully paid the
value of the subject landholding. As held in Mago v. Barbin,[35] the laws mandate full
payment of just compensation for the lands acquired under PD 27 prior to the issuance
of Emancipation Patents, thus:
In the first place, the Emancipation Patents and the Transfer Certificates of Title should
not have been issued to petitioners without full payment of the just compensation.
Under Section 2 of Presidential Decree No. 266, the DAR will issue the Emancipation
Patents only after the tenant-farmers have fully complied with the requirements for a
grant of title under PD 27. Although PD 27 states that the tenant-farmers are already
deemed owners of the land they till, it is understood that full payment of the just
compensation has to be made first before title is transferred to them. Thus, Section 6 of
EO 228 provides that ownership of lands acquired under PD 27 may be transferred only
after the agrarian reform beneficiary has fully paid the amortizations. [36]
Clearly, respondent is not entitled to be issued an Emancipation Patent considering that

he has not fully complied with the requirements for a grant of title under PD 27. [37]
On the issue of petitioner's claim that the subject landholding forms part of the retained
area awarded to him and his sisters, the Court notes that there was no sufficient
evidence to substantiate petitioner's claim. Furthermore, as held by the Court of
Appeals, only the Office of the Secretary of the Department of Agrarian Reform (DAR)
has the exclusive jurisdiction to resolve the issue of whether petitioner is entitled to a
retention area.[38] Indeed, under Section 3 (3.5), Rule II of the DARAB 2003 Rules of
Procedure, the exercise of the right of retention by the landowner is under the exclusive
prerogative of and cognizable by the Office of the Secretary of the DAR. Besides, even
if the subject landholding forms part of petitioner's retained area, petitioner landowner
may still not eject respondent tenant absent any of the causes provided under the law.
The landowner cannot just terminate the leasehold relationship without valid cause.
WHEREFORE, we PARTIALLY GRANT the petition. We SET ASIDE the 8 February

2006 Decision and the 29 May 2006 Resolution of the Court of Appeals in CA-G.R. SP
No. 90212. We REINSTATE the 29 June 1998 Decision of the Department of Agrarian
Reform Adjudication Board in DARAB Case No. 5504.
SO ORDERED.
Rule 1 Sec 3(B)
G.R. No. 169466 May 9, 2007
DEPARTMENT OF BUDGET AND MANAGEMENT, represented by SECRETARY ROMULO L.

NERI, PHILIPPINE NATIONAL POLICE, represented by POLICE DIRECTOR GENERAL
ARTURO L. LOMIBAO, NATIONAL POLICE COMMISSION, represented by CHAIRMAN
ANGELO T. REYES, AND CIVIL SERVICE COMMISSION, represented by CHAIRPERSON
KARINA C. DAVID, Petitioners,
vs.
MANILA’S FINEST RETIREES ASSOCIATION, INC., represented by P/COL. FELICISIMO G.
LAZARO (RET.), AND ALL THE OTHER INP RETIREES, Respondents.
Assailed and sought to be set aside in this petition for review on certiorari under Rule 45 of the Rules
of Court are the following issuances of the Court of Appeals (CA) in CA-G.R. CV No. 78203, to wit:
1. Decision1 dated July 7, 2005 which affirmed in toto the decision of the Regional Trial Court
of Manila, Branch 32, in Civil Case No. 02-103702, a suit for declaratory relief, declaring the
herein respondents entitled to the same retirement benefits accorded upon retirees of the
Philippine National Police (PNP) under Republic Act (R.A.) No. 6975, as amended by R.A.
No. 8551, and ordering the herein petitioners to implement the proper adjustments on
respondents’ retirement benefits; and
2. Resolution2 dated August 24, 2005 which denied the petitioners’ motion for
reconsideration.
The antecedent facts:
In 1975, Presidential Decree (P.D.) No. 765 was issued constituting the Integrated National Police
(INP) to be composed of the Philippine Constabulary (PC) as the nucleus and the integrated police
forces as components thereof. Complementing P.D. No. 765 was P.D. No. 11843 dated August 26,
1977 (INP Law, hereinafter) issued to professionalize the INP and promote career development
therein.
On December 13, 1990, Republic Act (R.A.) No. 6975, entitled "AN ACT ESTABLISHING THE
PHILIPPINE NATIONAL POLICE UNDER A REORGANIZED DEPARTMENT OF THE INTERIOR
AND LOCAL GOVERNMENT, AND FOR OTHER PURPOSES," hereinafter referred to as PNP Law,
was enacted. Under Section 23 of said law, the Philippine National Police (PNP) would initially
consist of the members of the INP, created under P.D. No. 765, as well as the officers and enlisted
personnel of the PC. In part, Section 23 reads:
SEC. 23. Composition. – Subject to the limitation provided for in this Act, the Philippine National
Police, hereinafter referred to as the PNP, is hereby established, initially consisting of the members
of the police forces who were integrated into the Integrated National Police (INP) pursuant to
Presidential Decree No. 765, and the officers and enlisted personnel of the Philippine Constabulary
(PC).
A little less than eight (8) years later, or on February 25, 1998, R.A. No. 6975 was amended by R.A.
No. 8551, otherwise known as the "PHILIPPINE NATIONAL POLICE REFORM AND
REORGANIZATION ACT OF 1998." Among other things, the amendatory law reengineered the
retirement scheme in the police organization. Relevantly, PNP personnel, under the new law, stood
to collect more retirement benefits than what INP members of equivalent rank, who had retired under
the INP Law, received.
The INP retirees illustrated the resulting disparity in the retirement benefits between them and the
PNP retirees as follows:4
Retirement Rank Monthly Pension Difference

INP PNP INP PNP
Corporal SPO3 P 3,225.00 P 11,310.00 P 8,095.00
Captain P. Sr. Insp. P 5,248.00 P 15,976.00 P10,628.00
Brig. Gen. P. Chief Supt. P 10,054.24 P 18,088.00 P 8,033.76
Hence, on June 3, 2002, in the Regional Trial Court (RTC) of Manila, all INP retirees, spearheaded
by the Manila’s Finest Retirees Association, Inc., or the MFRAI (hereinafter collectively referred to as
the INP Retirees), filed a petition for declaratory relief,5 thereunder impleading, as respondents, the
Department of Budget and Management (DBM), the PNP, the National Police Commission
(NAPOLCOM), the Civil Service Commission (CSC) and the Government Service Insurance System
(GSIS). Docketed in the RTC as Civil Case No. 02-103702, which was raffled to Branch 22 thereof,
the petition alleged in gist that INP retirees were equally situated as the PNP retirees but whose
retirement benefits prior to the enactment of R.A. No. 6975, as amended by R.A. No. 8551, were
unconscionably and arbitrarily excepted from the higher rates and adjusted benefits accorded to the
PNP retirees. Accordingly, in their petition, the petitioning INP retirees pray that a –
DECLARATORY JUDGMENT be rendered in their favor, DECLARING with certainty that they, as
INP-retirees, are truly absorbed and equally considered as PNP-retirees and thus, entitled to enjoy
the SAME or IDENTICAL retirement benefits being bestowed to PNP-retirees by virtue of said PNP
Law or Republic Act No. 6975, as amended by Republic Act 8551, with the corollary mandate for the
respondents-government agencies to effect the immediate adjustment on their previously received
disparate retirement benefits, retroactive to its effectivity, and with due payment thereof.
The GSIS moved to dismiss the petition on grounds of lack of jurisdiction and cause of action. On
the other hand, the CSC, DBM, NAPOLCOM and PNP, in their respective answers, asserted that the
petitioners could not claim the more generous retirement benefits under R.A. No. 6975 because at
no time did they become PNP members, having retired prior to the enactment of said law. DBM,
NAPOLCOM and PNP afterwards filed their respective pre-trial briefs.
The ensuing legal skirmish is not relevant to the disposition of the instant case. The bottom line is
that, on March 21, 2003, the RTC came out with its decision6 holding that R.A. No. 6975, as
amended, did not abolish the INP but merely provided for the absorption of its police functions by the
PNP, and accordingly rendered judgment for the INP retirees, to wit:
WHEREFORE, this Court hereby renders JUDGMENT DECLARING the INP Retirees entitled to the
same or identical retirement benefits and such other benefits being granted, accorded and bestowed
upon the PNP Retirees under the PNP Law (RA No. 6975, as amended).
The respondents Government Departments and Agencies shall IMMEDIATELY EFFECT and
IMPLEMENT the proper adjustments on the INP Retirees’ retirement and such other benefits,
RETROACTIVE to its date of effectivity, and RELEASE and PAY to the INP Retirees the due
payments of the amounts.
SO ORDERED.
On April 2, 2003, the trial court issued what it denominated as Supplement to the Decision
whereunder it granted the GSIS’ motion to dismiss and thus considered the basic petition as
withdrawn with respect to the latter.
From the adverse decision of the trial court, the remaining respondents, namely, DBM, PNP,
NAPOLCOM and CSC, interposed an appeal to the CA whereat their appellate recourse was
docketed as CA-G.R. CV No. 78203.
As stated at the threshold hereof, the CA, in its decision of July 7, 2005,7 affirmed that of the trial
court upholding the entitlement of the INP retirees to the same or identical retirement benefits
accorded upon PNP retirees under R.A. No. 6975, as amended.
Their motion for reconsideration having been denied by the CA in` its equally assailed resolution of
August 24, 2005,8 herein petitioners are now with this Court via the instant recourse on their singular
submission that -
THE COURT OF APPEALS COMMITTED A SERIOUS ERROR IN LAW IN AFFIRMING THE

DECISION OF THE TRIAL COURT NOTWITHSTANDING THAT IT IS CONTRARY TO LAW AND
ESTABLISHED JURISPRUDENCE.
We DENY.
In the main, it is petitioners’ posture that R.A. No. 6975 clearly abolished the INP and created in its
stead a new police force, the PNP. Prescinding therefrom, petitioners contend that since the PNP is
an organization entirely different from the INP, it follows that INP retirees never became PNP
members. Ergo, they cannot avail themselves of the retirement benefits accorded to PNP members
under R.A. No. 6975 and its amendatory law, R.A. No. 8551.
A flashback at history is proper.
As may be recalled, R.A. No. 6975 was enacted into law on December 13, 1990, or just about four
(4) years after the 1986 Edsa Revolution toppled down the dictatorship regime. Egged on by the
current sentiment of the times generated by the long period of martial rule during which the police
force, the PC-INP, had a military character, being then a major service of the Armed Forces of the
Philippines, and invariably moved by a fresh constitutional mandate for the establishment of one
police force which should be national in scope and, most importantly, purely civilian in
character,9 Congress enacted R.A. No. 6975 establishing the PNP and placing it under the
Department of Interior and Local Government. To underscore the civilian character of the PNP, R.A.
No. 6975 made it emphatically clear in its declaration of policy the following:
Section 2. Declaration of policy - It is hereby declared to be the policy of the State to promote peace
and order, ensure public safety and further strengthen local government capability aimed towards
the effective delivery of the basic services to the citizenry through the establishment of a highly
efficient and competent police force that is national in scope and civilian in character. xxx.
The police force shall be organized, trained and equipped primarily for the performance of police
functions. Its national scope and civilian character shall be paramount. No element of the police
force shall be military nor shall any position thereof be occupied by active members of the [AFP].
(Emphasis and word in bracket supplied.)
Pursuant to Section 23, supra, of R.A. No. 6975, the PNP initially consisted of the members of the
police forces who were integrated into the INP by virtue of P.D. No. 765, while Section 8610 of the
same law provides for the assumption by the PNP of the police functions of the INP and its
absorption by the former, including its appropriations, funds, records, equipment, etc., as well as its
personnel.11 And to govern the statute’s implementation, Section 85 of the Act spelled out the
following absorption phases:
Phase I – Exercise of option by the uniformed members of the [PC], the PC elements assigned with
the Narcotics Command, CIS, and the personnel of the technical services of the AFP assigned with
the PC to include the regular CIS investigating agents and the operatives and agents of the
NAPOLCOM Inspection. Investigation and Intelligence Branch, and the personnel of the absorbed
National Action Committee on Anti-Hijacking (NACAH) of the Department of National Defense to be
completed within six (6) months from the date of the effectivity of this Act. At the end of this phase,
all personnel from the INP, PC, AFP Technical Services, NACAH, and NAPOLCOM Inspection,
Investigation and Intelligence Branch shall have been covered by official orders assigning them to
the PNP, Fire and Jail Forces by their respective units.
Phase II – Approval of the table of organization and equipment of all bureaus and offices created
under this Act, preparation and filling up of their staffing pattern, transfer of assets to the [DILG] and
organization of the Commission, to be completed within twelve (12) months from the effectivity date
hereof. At the end of this phase, all personnel to be absorbed by the [DILG] shall have been issued
appointment papers, and the organized Commission and the PNP shall be fully operational.
The PC officers and enlisted personnel who have not opted to join the PNP shall be reassigned to
the Army, Navy or Air Force, or shall be allowed to retire under existing AFP rules and regulations.
Any PC-INP officer or enlisted personnel may, within the twelve-month period from the effectivity of
this Act, retire and be paid retirement benefits corresponding to a position two (2) ranks higher than
his present grade, subject to the conditions that at the time he applies for retirement, he has
rendered at least twenty (20) years of service and still has, at most, twenty-four (24) months of
service remaining before the compulsory retirement age as provided by existing law for his office.
Phase III – Adjustment of ranks and establishment of one (1) lineal roster of officers and another for
non-officers, and the rationalization of compensation and retirement systems; taking into
consideration the existing compensation schemes and retirement and separation benefit systems of
the different components of the PNP, to ensure that no member of the PNP shall suffer any
diminution in basic longevity and incentive pays, allowances and retirement benefits due them
before the creations of the PNP, to be completed within eighteen (18) months from the effectivity of
this Act. xxx.
Upon the effectivity of this Act, the [DILG] Secretary shall exercise administrative supervision as well
as operational control over the transferred, merged and/or absorbed AFP and INP units. The
incumbent Director General of the PC-INP shall continue to act as Director General of the PNP until
… replaced …. (Emphasis and words in brackets supplied.)
From the foregoing, it appears clear to us that the INP was never, as posited by the petitioners,
abolished or terminated out of existence by R.A. No. 6975. For sure, nowhere in R.A. No. 6975 does
the words "abolish" or "terminate" appear in reference to the INP. Instead, what the law provides is
for the "absorption," "transfer," and/or "merger" of the INP, as well as the other offices comprising the
PC-INP, with the PNP. To "abolish" is to do away with, to annul, abrogate or destroy completely;12 to
"absorb" is to assimilate, incorporate or to take in.13 "Merge" means to cause to combine or unite to
become legally absorbed or extinguished by merger14 while "transfer" denotes movement from one
position to another. Clearly, "abolition" cannot be equated with "absorption."
True it is that Section 9015 of R.A. No. 6975 speaks of the INP "[ceasing] to exist" upon the effectivity
of the law. It ought to be stressed, however, that such cessation is but the logical consequence of
the INP being absorbed by the PNP. 1a\^/phi1.net
Far from being abolished then, the INP, at the most, was merely transformed to become the PNP,
minus of course its military character and complexion.
Even the petitioners’ effort at disclosing the legislative intent behind the enactment of R.A. No. 6975
cannot support their theory of abolition. Rather, the Senate and House deliberations on the bill that
eventually became R.A. No. 6975 reveal what has correctly been held by the CA in its assailed
decision: that the PNP was precisely created to erase the stigma spawned by the militarization of the
police force under the PC-INP structure. The rationale behind the passage of R.A. No. 6975 was
adequately articulated by no less than the sponsor16 of the corresponding House bill in his
sponsorship speech, thus:
By removing the police force from under the control and supervision of military officers, the bill seeks
to restore and underscore the civilian character of police work - an otherwise universal concept that
was muddled up by the martial law years.
Indeed, were the legislative intent was for the INP’s abolition such that nothing would be left of it, the
word "abolish" or what passes for it could have easily found its way into the very text of the law itself,
what with the abundant use of the word during the legislative deliberations. But as can be gleaned
from said deliberations, the lawmakers’ concern centered on the fact that if the entire PC-INP corps
join the PNP, then the PC-INP will necessarily be abolished, for who then would be its members? Of
more consequence, the lawmakers were one in saying that there should never be two national police
agencies at the same time.
With the conclusion herein reached that the INP was not in fact abolished but was merely
transformed to become the PNP, members of the INP which include the herein respondents are,
therefore, not excluded from availing themselves of the retirement benefits accorded to PNP retirees
under Sections 7417 and 7518 of R.A. No. 6975, as amended by R.A. No. 8551. It may be that
respondents were no longer in the government service at the time of the enactment of R.A. No.
6975. This fact, however, without more, would not pose as an impediment to the respondents’
entitlement to the new retirement scheme set forth under the aforecited sections. As correctly
ratiocinated by the CA to which we are in full accord:
For sure, R.A. No. 6975 was not a retroactive statute since it did not impose a new obligation to pay
the INP retirees the difference between what they received when they retired and what would now
be due to them after R.A. No. 6975 was enacted. Even so, that did not render the RTC’s
interpretation of R.A. No. 6975 any less valid. The [respondents’] retirement prior to the passage of
R.A. No. 6975 did not exclude them from the benefits provided by R.A. No. 6975, as amended by
R.A. No. 8551, since their membership in the INP was an antecedent fact that nonetheless allowed
them to avail themselves of the benefits of the subsequent laws. R.A. No. 6975 considered them as
PNP members, always referring to their membership and service in the INP in providing for their
retirement benefits. 19
Petitioners maintain, however, that NAPOLCOM Resolution No. 8,20 particularly Section 1121 thereof,
bars the payment of any differential in retirement pay to officers and non-officers who are already
retired prior to the effectivity of R.A. No. 6975.
The contention does not commend itself for concurrence.
Under the amendatory law (R.A. No. 8551), the application of rationalized retirement benefits to PNP
members who have meanwhile retired before its (R.A. No. 8551) enactment was not prohibited. In
fact, its Section 3822 explicitly states that the rationalized retirement benefits schedule and program
"shall have retroactive effect in favor of PNP members and officers retired or separated from the
time specified in the law." To us, the aforesaid provision should be made applicable to INP members
who had retired prior to the effectivity of R.A. No. 6975. For, as afore-held, the INP was, in effect,
merely absorbed by the PNP and not abolished.
Indeed, to bar payment of retirement pay differential to INP members who were already retired
before R.A. No. 6975 became effective would even run counter to the purpose of NAPOLCOM
Resolution No. 8 itself, as expressed in its preambulatory clause, which is to rationalize the
retirement system of the PNP taking into consideration existing retirement and benefit systems
(including R.A. No. 6975 and P.D. No. 1184) of the different components thereof "to ensure that no
member of the PNP shall suffer any diminution in the retirement benefits due them before the
creation of the PNP."23
Most importantly, the perceived restriction could not plausibly preclude the respondents from
asserting their entitlement to retirement benefits adjusted to the level when R.A. No. 6975 took
effect. Such adjustment hews with the constitutional warrant that "the State shall, from time to time,
review to upgrade the pensions and other benefits due to retirees of both the government and
private sectors,"24 and the implementing mandate under the Senior Citizen’s Law25 that "to the extent
practicable and feasible, retirement benefits xxx shall be upgraded to be at par with the current scale
enjoyed by those in actual service." 1awphi1.nét
Certainly going for the respondents in their bid to enjoy the same retirement benefits granted to PNP
retirees, either under R.A. No. 6975 or R.A. No. 8551, is Section 34 of the latter law which amended
Section 75 of R.A. No. 6975 by adding thereto the following proviso:
Section 75. Retirement benefits. x x x: Provided, finally, That retirement pay of the officers/non-
officers of the PNP shall be subject to adjustments based on the prevailing scale of base pay of
police personnel in the active service.
Then, too, is the all familiar rule that:
Retirement laws should be liberally construed in favor of the retiree because their intention is to
provide for his sustenance and hopefully, even comfort, when he no longer has the stamina to
continue earning his livelihood. The liberal approach aims to achieve the humanitarian purposes of
the law in order that efficiency, security and well-being of government employees may be
enhanced.26
The petitioners parlay the notion of prospective application of statutes, noting in this regard that R.A.
No. 6975, as amended, cannot be applied retroactively, there being no provision to that effect.
We are not persuaded.
As correctly found by the appellate court, R.A. No. 6975 itself contextually provides for its retroactive
application to cover those who had retired prior to its effectivity. In this regard, we invite attention to
the three (3) phases of implementation under Section 85 for the absorption and continuation in the
service of, among others, the INP members under the newly-established PNP.
In a further bid to scuttle respondents’ entitlement to the desired retirement benefits, the petitioners
fault the trial court for ordering the immediate adjustments of the respondents’ retirement benefits
when the basic petition filed before it was one for declaratory relief. To the petitioners, such petition
does not essentially entail an executory process, the only relief proper under that setting being a
declaration of the parties’ rights and duties.
Petitioners’ above posture is valid to a point. However, the execution of judgments in a petition for
declaratory relief is not necessarily indefensible. In Philippine Deposit Insurance Corporation[PDIC]
v. Court of Appeals,27 wherein the Court affirmed the order for the petitioners therein to pay the
balance of the deposit insurance to the therein respondents, we categorically ruled:
Now, there is nothing in the nature of a special civil action for declaratory relief that proscribes the
filing of a counterclaim based on the same transaction, deed or contract subject of the complaint. A
special civil action is after all not essentially different from an ordinary civil action, which is generally
governed by Rules 1 to 56 of the Rules of Court, except that the former deals with a special subject
matter which makes necessary some special regulation. But the identity between their fundamental
nature is such that the same rules governing ordinary civil suits may and do apply to special civil
actions if not inconsistent with or if they may serve to supplement the provisions of the peculiar rules
governing special civil actions.28
Similarly, in Matalin Coconut Co., Inc. v. Municipal Council of Malabang, Lanao del Sur:29 the Court
upheld the lower court’s order for a party to refund the amounts paid by the adverse party under the
municipal ordinance therein questioned, stating:
x x x Under Sec. 6 of Rule 64, the action for declaratory relief may be converted into an ordinary
action and the parties allowed to file such pleadings as may be necessary or proper, if before the
final termination of the case "a breach or violation of an … ordinance, should take place." In the
present case, no breach or violation of the ordinance occurred. The petitioner decided to pay "under
protest" the fees imposed by the ordinance. Such payment did not affect the case; the declaratory
relief action was still proper because the applicability of the ordinance to future transactions still
remained to be resolved, although the matter could also be threshed out in an ordinary suit for the
recovery of taxes paid …. In its petition for declaratory relief, petitioner-appellee alleged that by
reason of the enforcement of the municipal ordinance by respondents it was forced to pay under
protest the fees imposed pursuant to the said ordinance, and accordingly, one of the reliefs prayed
for by the petitioner was that the respondents be ordered to refund all the amounts it paid to
respondent Municipal Treasurer during the pendency of the case. The inclusion of said allegation
and prayer in the petition was not objected to by the respondents in their answer. During the trial,
evidence of the
payments made by the petitioner was introduced. Respondents were thus fully aware of the
petitioner's claim for refund and of what would happen if the ordinance were to be declared invalid by
the court.
The Court sees no reason for treating this case differently from PDIC and Matalin. This disposition
1awphi1.nét
becomes all the more appropriate considering that the respondents, as petitioners in the RTC,
pleaded for the immediate adjustment of their retirement benefits which, significantly, the herein
petitioners, as respondents in the same court, did not object to. Being aware of said prayer, the
petitioners then already knew the logical consequence if, as it turned out, a declaratory judgment is
rendered in the respondents’ favor.
At bottom then, the trial court’s judgment forestalled multiplicity of suits which, needless to stress,
would only entail a long and arduous process. Considering their obvious advanced years, the
respondents can hardly afford another protracted proceedings. It is thus for this Court to already
write finis to this case.
WHEREFORE, the instant petition is DENIED and the assailed decision and resolution of the CA,
respectively dated July 7, 2005 and August 24, 2005, are AFFIRMED.
No costs.
SO ORDERED.
G.R. No. L-41808 March 30, 1979
ENGRACIA B. AMBERTI and Minor MARIA TERESA AMBERTI, represented by her

mother, Petitioners, vs. HON. COURT OF APPEALS (Ninth Division) *, ROMEO D.
ZAMORA and ESTELA LLENADO ZAMORA, Respondents.
Delos Reyes Delos Reyes & Associates for petitioners.chanrobles virtual law library
Lorenzo Sumulong for private respondents.
TEEHANKEE, J.:
The Court upholds respondent appellate court's decision setting aside the lower court's
decision and remanding the case to allow respondents-defendants to adduce their evidence
and reiterates once more that hasty disposal of cases to the extent of denying an urgent
and justified motion for cancellation of a scheduled hearing date and for the early resetting
thereof (based on defendants' counsel's physical disability to attend the hearing duly
certified under oath by his physician and on both counsel's agreement) are not a panacea
nor solution to the congestion of court dockets. Judicial discretion must be exercised wisely
and not capriciously and it is sound judicial discretion to allow a reasonable transfer of
hearing when no substantial rights are affected and the intention to delay is not
manifest.chanroblesvirtualawlibrary chanrobles virtual law library
Petitioners as plaintiffs filed on August 17, 1970 with the court of first instance of Rizal at
Makati 1 their complaint against private respondents, the spouses Romeo D. Zamora and
Estela Llenado Zamora, for recovery of actual, moral and exemplary damages and
attorney's fees from said respondents for alleged criminal and libelous intrigue and
conspiracy to take over the marble business and hasten the death on June 11, 1970 of the
late Piero Amberti husband and father of petitioners Engracia and Maria Teresa,
respectively.chanroblesvirtualawlibrary chanrobles virtual law library
Respondents as defendants filed their answer on August 31, 1970 traversing the allegations
of the complaint as "absolutely false and malicious" and averring that respondent as Piero's
physician "was mainly responsible for prolonging [his) fife and bringing him along the road
to recovery by correct diagnosis and treatment of his lung cancer" and that respondent
Estela L. Zamora's alleged libelous letters (which allegedly enraged Piero when he opened
and read them and caused his collapse into unconsciousness and death) were private and
privileged communications addressed to her husband and intended for him only.
Respondents spouses, as a well-known thoracic surgeon, and doctor of science in chemistry
and dean of the Graduate School of the University of Santo Tomas, respectively filed a
counterclaim for respondent Dr. Zamora's medical fees in the total amount of P86,400.00
and for moral and exemplary damages and attomey's fees which was answered and
traversed in due course by petitioners.chanroblesvirtualawlibrary chanrobles virtual law
library
Pre-trial proceedings were held and thereafter the case was set for trial on the merits which
commenced on June 14, 1971 with petitioner Maria Teresa and her "yaya" Yolanda Salgan
testifying as witnesses for petitioners-plaintiffs. Hearings continued on July 26 and July 28,
1971 with petitioner Engracia testing on direct examination and on August 17, 1971
respondents' counsel, Atty. Ricardo J. Francisco, commenced his cross-examination, which
he continued on September 14, 1971 until he was "exhausted" and asked for continuance
and the trial court reset the continuation thereof on September 23, 1971, as previously
scheduled, remarking that there were many other cases set for that day anyway with a
witness from Hongkong scheduled to testify on the same day. There were also a number of
scheduled hearing dates in June, July and August, 1971 that were cancelled for apparently
valid reasons either at respondents' counsel's instance without objection of petitioners'
counsel or by agreement of both parties' counsels.chanroblesvirtualawlibrary chanrobles
virtual law library
On September 22, 1971 or one day before the scheduled date, Atty. Francisco filed an
urgent motion for postponement and resetting of the hearings to October 7 and 14, 1971 on
the ground that he was "presently suffering from hypertension accompanied with dizzy
spells and has been advised by his physician to rest for at least two (2) weeks" and stating
that he had communicated with petitioners' counsel who had "sportingly agreed" to the
postponement and the resettings. The trial court nevertheless denied the postponement,
directed petitioners to proceed with the presentation and termination of their evidence ex
parte and rendered its decision and judgment dated October 6, 1971, as follows:
WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and against defendants,
ordering the latter, jointly and severally, to pay the former the sum of TWELVE THOUSAND
PESOS (P12,000.00) for death indemnity ONE HUNDRED THOUSAND PESOS (P100,000.00)
for compensatory damages and lost earnings, FIFTY THOUSAND PESOS (P50,000.00) for
moral damages, TWENTY THOUSAND PESOS (P20,000.00) for attorney's fees. With
costs.chanroblesvirtualawlibrary chanrobles virtual law library
Defendants' counter is hereby dismissed for lack of merit.
On appeal, reconsideration having been denied by the trial court, respondent Court of
Appeals rendered its decision of August 21, 1975, wherein it set aside the appealed decision
and remanded the case to the trial court "with instructions to snow the defendants
[respondents herein] to adduce their evidence," as follows:
According to the transcript, on September 23, 1971 the following proceedings took place:
ATTY. DE LOS REYES: chanrobles virtual law library
For the plaintiffs, your Honor please.chanroblesvirtualawlibrary chanrobles virtual law library
ATTY. GONZALEZ: chanrobles virtual law library
There is an urgent motion for postponement your Honor

please.chanroblesvirtualawlibrary chanrobles virtual law library
I would like to make a record that this is the fourth postponement in the continuation of the
cross examination of my client Mrs. Amberti. While he truthfully called me up asking me for
postponement on the ground that he has hypertension and sick of kidney trouble, I would
like to request, your Honor, in order to meet any technicality he may later on make, that
the two dates being asked be intransferrable in character and the cross-examination of the
witness be considered terminated.chanroblesvirtualawlibrary chanrobles virtual law library
COURT: chanrobles virtual law library
Call the defendants.chanroblesvirtualawlibrary chanrobles virtual law library
ATTY. GONZALEZ: chanrobles virtual law library
Dr. Romeo D. Mendoza, Mrs. Estela Mendoza. (nobody answered the call) [sic] They are not
around, your Honor.chanroblesvirtualawlibrary chanrobles virtual law library
At what stage are we now? chanrobles virtual law library
My witness, Mrs. Amberti is still in cross, your Honor.chanroblesvirtualawlibrary chanrobles

virtual law library
Are you ready to rest your evidence? chanrobles virtual law library
I still have another witness, your Honor, please.chanroblesvirtualawlibrary chanrobles

virtual law library
All right, considering that this is the fourth postponement filed by counsel for the defendant
always at eleventh hour and taking into account that there is no medical certificate attached
to the motion for postponement, the same is hereby denied. Ready with your
evidence? chanrobles virtual law library
Yes, your Honor. May we make of record that the defendants have been represented by the
three (3) counsels Atty. Francisco, Atty. Acuña and Ex-Judge Francisco Geronimo who were
supposed to represent them also in the other case and have not appeared in today's
hearing. (t.s.n., pp. 2-5, Sept. 23, 1971)
It is thus seen that the counsel for the plaintiffs did not oppose the urgent motion for
postponement. In fact, he asked that 'in order to meet any technicality he may later on
make, that the two dates being asked be intransferrable in
character ...chanroblesvirtualawlibrary chanrobles virtual law library
It was shown later by a medical certificate attached to the motion for reconsideration that
the counsel for defendants, Atty. Ricardo J. Francisco, was suffering from hypertension and
he could not have appeared in court on September 23, 1971 without endangering his
health. The motion for postponement, therefore, was not for the purpose of delay. The
effect of the denial of the motion for postponement was to deprive the defendants of their
day in court inasmuch as they were not able to adduce their
evidence.chanroblesvirtualawlibrary chanrobles virtual law library
Considering all the circumstances of the case and the fact that large sums of money are
involved, it is in the interest of substantial justice that the decision be set aside and that the
defendants be allowed to adduce their evidence. However, the evidence of the plaintiffs
already on record shall remain without the necessity of recalling the witnesses for purposes
of cross-examination by defendants.
Petitioners' motion for reconsideration having been denied by respondent appellate court
per its Resolution of October 15, 1975, petitioners filed on November 4, 1975 the petition at
bar. The Court per its Resolution of January 19, 1976, after receiving the parties' pleadings,
granted due course and resolved to treat the petition as a special civil action and to require
concise memoranda strictly confined to the issues from the
parties.chanroblesvirtualawlibrary chanrobles virtual law library
The Court finds no error nor grave abuse of discretion in respondent court's decision setting
aside the trial court's decision and remanding the case for the reception of respondents'
evidence in support of their defenses to the action and their
counter.chanroblesvirtualawlibrary chanrobles virtual law library
1. Although left unsaid by respondent court, the crucial issue that it resolved was that
raised by respondents in their first assignment of error, to wit, that they had been denied of
their day in court with the trial court's denial of their counsel's urgent motion for
postponement or cancellation of the September 23, 1971 hearing and its resetting for
October 7 and 14, 1971 as agreed upon with petitioners' counsel. This hinges on whether
the trial judge acted with grave abuse of discretion in denying the postponement and
reconsideration notwithstanding its having called counsel's physician who testified to
counsel's physical disability to appear at the scheduled hearing. The facts of record so
indicate, as may be seen from the following.chanroblesvirtualawlibrary chanrobles virtual
law library
(a) The undisputed transcript of the proceedings on September 23, 1971 as reproduced in
respondent court's decision (and also in petitioners' opposition 2 to respondents' motion for
reconsideration dated October 7, 1971 of the trial court's Order of September 23, 1971
denying respondents' urgent motion for postponement of the scheduled hearing on said
date which order was received by Atty. Francisco on October 6, 1971) shows quite clearly,
contrary to the pretensions of petitioners' counsel now, that he made no objection to the
postponement but confirmed to the trial court that he had in effect acceded to the
postponement requested by Atty. Francisco "on the ground that he has hypertension and
(is) sick of kidney trouble" and agreed with him on the resetting thereof to October 7 and
14, 1971 and expressly requested of the trial court "that the two dates being asked be
intransferrable in character and the cross-examination of the witness be con. considered
terminated;" chanrobles virtual law library
(b) The same transcript records no objection on petitioners' counsel's part nor mention
thereof by the trial court in denying the postponement, but its formal Order of denial of
September 23, 1971 as served on Atty. Francisco on October 6, 1971 recites that the court
"(took) into account the vehement objections made by counsel for the plaintiffs in open
hearing this morning" which not even petitioners' counsel now claims to have made on said
occasion. What appears quite clearly is that it was after such denial by the trial court of the
postponement of the September 23, 1971 hearing and its rendition of the October 6, 1971
decision against respondents that petitioners' counsel then "vehemently" opposed
respondents' motions for reconsideration of the denial order and of the decision itself in an
obvious effort to unhold the decision which abruptly cut off respondents' right to present
their evidence; chanrobles virtual law library
(c) The trial judge's actions were erratic in this regard. When Atty. Francisco attached to his
motion for reconsideration of the denial order the supporting medical certificate of his
physician, Dr. Benjamin M. Limson, the trial judge required Dr. Limson to appear before
him, thus making it understood that Dr. Limson's testimony as to physical condition of Atty.
Francisco was vital to his action on the pending motion for reconsideration. Dr. Limson did
appear on October 22, 1971 before the trial judge who examined him under oath and he
affirmed under oath that Atty. Francisco was in his clinic on September 21, 1971 because of
dizzy spells and with very high blood pressure (160/105). Despite his having received the
doctor's undisputed assurance under oath that Atty. Francisco was really physically unable
to appear at the September 23, 1971 hearing, the trial judge nevertheless by order of
November 13, 1971 denied reconsideration of the denial order "for lack of merit, it
appearing that a decision had already been rendered in this case on October 6, 1971."
and chanrobles virtual law library
(d) The trial court's adverse decision dated October 6, 1971 was served on Atty. Francisco
on November 2, 1971 and he filed on November 26, 1971 a Motion for Reconsideration of
the Decision and for New Trial. The motion for reconsideration assailed point by point the
conclusions of fact as "baseless and unfounded", arguing inter alia that there was no
competent evidence to justify the trial court's conclusion that Piero Amberti died of heart
disease by reason of "extreme anger" and that the alleged libelous letters were written by
respondent Estela L. Zamora to her husband and that Piero had no right to open and read
them and further submitted an affidavit of merits that respondents "have a good and
meritorious defense consisting of oral and documentary evidence showing that they are not
responsible for the death of plaintiff Piero Amberti, and that the letter alluded to in the
complaint is not libelous and otherwise is not actionable, as averred in defendants' answer
to the complaint." chanrobles virtual law library
The trial judge issued under date of January 12, 1972 his Order denying reconsideration
(copy whereof was received by Atty. Francisco on January 18, 1972) on the ground "that
the reasons alleged in said motion are a mere reiteration of the grounds averred in
defendants' Motion for Reconsideration dated October 7, 1971, and, it appearing that no
new matters have been raised therein other than those which have already been taken up
and considered by the Court in its order of November 13,1971." This was patent error on
the trial judge's part, because the grounds in respondents' first motion of October 7, 1971
dealt exclusively with asking for reconsideration of the court's order of September 23,
1971 denying postponement of the hearing scheduled on said date and submitted the
medical certificate supporting his physical inability to attend the scheduled hearing. On the
other hand, the grounds in respondents' second motion of November 26, 1971 dealt mainly
with seeking reconsideration of the trial court's decision of October 6, 1971 and presented
completely different grounds to obtain the reconsideration of the decision, viz, that it had no
factual basis and/or was contrary to law, while praying for a new trial and opportunity to
cross-examine petitioners' witnesses and present respondents' evidence and for a new
decision dismissing the complaint. Contrary to the statement in the January 12, 1972 Order,
these were entirely new matters which had not been taken up in the November 13, 1971
Order which had peremptorily denied reconsideration of the September 23, 1971 hearing on
the bare ground "that a decision had already been rendered in this case on October 6,
1971." chanrobles virtual law library
2. The above facts fifty support respondent court's conclusions that opposing counsels had
agreed on transferring the scheduled September 23, 1971 hearing to two early dates in the
following month which petitioners' counsel requested that the trial court set with an
"intransferrable character", that the motion for postponement was not dilatory but due to
Atty. Francisco's serious ailment and that the trial court therefore wrongfully deprived
respondents of their day in court in denying the postponement and instead terminating the
case. Petitioners' counsel is as much to blame, for had he but maintained his "sporting
posture in agreeing to the postponement and asked that the next two hearing dates be
intransferrable in character, respondents would have had to adduce their evidence on said
dates and if they failed or asked for further postponement, then they would no longer be
able to complain of not being afforded their day in court - and in any case, this case would
have been adjudicated much earlier. After all, the case was but a year old and the hearings
had progressed quite satisfactorily and at a pace beyond the average
case.chanroblesvirtualawlibrary chanrobles virtual law library
After respondent court per its decision of August 21, 1975 ordered the setting aside of the
lower court's decision and the remand of the case for the reception of respondents'
evidence, petitioners still insisted on coming to this Court and delaying the remand and
presentation of evidence in the lower court with averments that respondents had no valid
defense and "resorted to dilatory postponements" and that respondent court had "ignored
the facts, law and jurisprudence ... to favor the private respondents for no cogent, legal
reasons" and "disregarded and skipped decisive issue of decisive importance, like the issue
of finality of the judgment appealed from which would render unnecessary resolution of all
other issues," 3 which after the Court's scrutiny have been found to be without
basis.chanroblesvirtualawlibrary chanrobles virtual law library
3. The Court has consistently maintained that although a speedy determination of an action
implies a speedy trial, speed is not the chief objective of a trial. Careful and deliberate
consideration for the administration of justice, a genuine respect for the rights of all parties
and the requirements of procedural due process and an adherence to the Court's standing
admonition that the discretion granted judges in the granting or denial of motions for
postponement and the setting aside of denial orders previously issued "should always be
predicated on the consideration that more than the mere convenience of the courts or of the
parties in the case, the ends of justice and fairness would be served thereby" 4 are more
important than a race to end the trial.chanroblesvirtualawlibrary chanrobles virtual law
library
The Court thus stressed in Macasa vs. Herrera 5 that "(I)nconsiderate dismissals, even if
without prejudice, do not constitute a panacea nor a solution to the congestion of court
dockets; while they lend a deceptive aura of efficiency to records of individual judges, they
merely postpone the ultimate reckoning between the parties. In the absence of a clear lack
of merit or intention to delay, justice is better served by a brief continuance, trial on the
merits, and final disposition of the cases before the court." As reiterated in Cucio 6 "it is
sound judicial discretion to allow a reasonable transfer of hearing ..."when no substantial
rights are affected and the intention to delay is not manifest" in line with the established
rule that "the discretion of trial courts (and of all courts for that matter) "must be exercised
wisely and prudently, never capriciously, with a view to substantial justice." chanrobles
virtual law library
4. Petitioners' claim that the lower court's judgment had already become final - which was
not passed upon by respondent court - is manifestly untenable. The Record on Appeal
shows that Respondents through counsel received a copy of the decision dated October 6,
1971 on November 2, 1971. They filed their motion for reconsideration and new tried on the
24th day, i.e. November 26, 1971. The lower court denied the motion for reconsideration
and new trial in its order dated January 12, 1972, a copy whereof was received by
respondents on January 18, 1972. Upon receipt of the order denying their motion for
reconsideration and new trial on January 19 1972, they perfected their appeal on the same
date January 18, 1972, when there were yet six (6) days remaining of the reglementary 30-
day period to appeal.chanroblesvirtualawlibrary chanrobles virtual law library
Petitioners' premise for its claim that respondents motion for reconsideration and new trial
was a pro forma motion which did not toll the period for appeal is just as manifestly
untenable as shown herein above. 7 chanrobles virtual law library
ACCORDINGLY, judgment is hereby rendered dismissing the petition. As directed in

respondent court's decision, the case shall be forthwith remanded to the trial court for the
reception of respondents evidence in the case below and for continuation of the trial therein
as provided in the Rules of Court 8 No costs.
Rule 1 Sec 3(C)
G. R. No. 76431 October 16, 1989
FORTUNE MOTORS, (PHILS.) INC., petitioner,

vs.
THE HONORABLE COURT OF APPEALS, METROPOLITAN BANK and TRUST
COMPANY, respondents.
This is a petition for review on certiorari seeking the reversal of: (a) the July 30, 1986 decision of the
Court of Appeals in AC-G.R. SP No. 09255 entitled "Metropolitan Bank & Trust Co. v. Hon. Herminio
C. Mariano, et al." dismissing Civil Case No. 8533218 entitled "Fortune Motors (Phils.) Inc. v.
Metropolitan Bank & Trust Co." filed in the Regional Trial Court of Manila, Branch IV for improper
venue and (b) the resolution dated October 30, 1986 denying petitioner's motion for reconsideration.
The undisputed facts of the case are as follows:
On March 29,1982 up to January 6,1984, private respondent Metropolitan Bank extended various
loans to petitioner Fortune Motors in the total sum of P32,500,000.00 (according to the borrower; or
P34,150,000.00 according to the Bank) which loan was secured by a real estate mortgage on the
Fortune building and lot in Makati, Rizal. (Rollo, pp. 60-62)
Due to financial difficulties and the onslaught of economic recession, the petitioner was not able to
pay the loan which became due. (Rollo, p. 62)
For failure of the petitioner to pay the loans, the respondent bank initiated extrajudicial foreclosure
proceedings. After notices were served, posted, and published, the mortgaged property was sold at
public auction for the price of P47,899,264.91 to mortgagee Bank as the highest bidder. (Rollo, p.
11)
The sheriff's certificate of sale was registered on October 24, 1984 with the one-year redemption
period to expire on October 24,1985. (Rollo, p. 12)
On October 21, 1985, three days before the expiration of the redemption period, petitioner Fortune
Motors filed a complaint for annulment of the extrajudicial foreclosure sale alleging that the
foreclosure was premature because its obligation to the Bank was not yet due, the publication of the
notice of sale was incomplete, there was no public auction, and the price for which the property was
sold was "shockingly low". (Rollo, pp. 60-68)
Before summons could be served private respondent Bank filed a motion to dismiss the complaint
on the ground that the venue of the action was improperly laid in Manila for the realty covered by the
real estate mortgage is situated in Makati, therefore the action to annul the foreclosure sale should
be filed in the Regional Trial Court of Makati. (Rollo, pp. 67-71-A )
The motion was opposed by petitioner Fortune Motors alleging that its action "is a personal action"
and that "the issue is the validity of the extrajudicial foreclosure proceedings" so that it may have a
new one year period to redeem. (Rollo, pp. 72-73)
On January 8, 1986 an order was issued by the lower court reserving the resolution of the Bank's
motion to dismiss until after the trial on the merits as the grounds relied upon by the defendant were
not clear and indubitable. (Rollo, p. 81)
The Bank filed a motion for reconsideration of the order dated January 8, 1986 but it was denied by
the lower court in its order dated May 28, 1986. (Rollo, Annex "L" pp. 93-96; Annex "N" p. 99)
On June 11, 1986 the respondent Bank filed a petition for certiorari and prohibition in the Court of
Appeals. (Rollo, Annex "O" pp. 100-115)
And on July 30, 1986, a decision was issued by the Court of Appeals, the dispositive part of which
reads as follows:
WHEREFORE, the petition for certiorari and prohibition is granted. The complaint in
the Civil Case No. 85-33218 is dismissed without prejudice to its being filed in the
proper venue. Costs against the private respondent.
SO ORDERED. (Rollo, p. 15)
A motion for reconsideration was filed on August 11, 1986 on the said decision and on October 30,
1986 a resolution was issued denying such motion for reconsideration. (Rollo, Annex "O" pp. 121-
123; Annex "S" p. 129)
Hence, the petition for review on certiorari.
On June 10, 1987 the Court gave due course to the petition, required the parties to file their
respective memoranda within twenty (20) days from the notice hereof, and pay deposit for costs in
the amount of P80.40.
Both parties have filed their respective memoranda, and the case was submitted for Court's
resolution in the resolution dated December 14, 1987. (Rollo,Metrobank's Memorandum pp. 45-59;
petitioner's memorandum pp.130-136; Res. p. 138)
The only issue in this case is whether petitioner's action for annulment of the real estate mortgage
extrajudicial foreclosure sale of Fortune Building is a personal action or a real action for venue
purposes.
In a real action, the plaintiff seeks the recovery of real property, or as indicated in Sec. 2 (a) of Rule
4, a real action is an action affecting title to real property, or for the recovery of possession, or for the
partition or condemnation of, or foreclosure of a mortgage on real property. (Comments on the Rules
of Court by Moran, Vol. 1, p. 122)
Real actions or actions affecting title to, or for the recovery of possession, or for the partition or
condemnation of, or foreclosure of mortgage on real property, must be instituted in the Court of First
Instance of the province where the property or any part thereof lies. (Enriquez v. Macadaeg, 84 Phil.
674,1949; Garchitorena v. Register of Deeds, 101 Phil. 1207, 1957)
Personal actions upon the other hand, may be instituted in the Court of First Instance where the
defendant or any of the defendants resides or may be found, or where the plaintiff or any of the
plaintiffs resides, at the election of the plaintiff (Sec. 1, Rule 4, Revised Rules of Court).
A prayer for annulment or rescission of contract does not operate to efface the true objectives and
nature of the action which is to recover real property. (Inton, et al., v. Quintan, 81 Phil. 97, 1948)
An action for the annulment or rescission of a sale of real property is a real action. Its prime objective
is to recover said real property. (Gavieres v. Sanchez, 94 Phil. 760,1954)
An action to annul a real estate mortgage foreclosure sale is no different from an action to annul a
private sale of real property. (Munoz v. Llamas, 87 Phil. 737,1950)
While it is true that petitioner does not directly seek the recovery of title or possession of the property
in question, his action for annulment of sale and his claim for damages are closely intertwined with
the issue of ownership of the building which, under the law, is considered immovable property, the
recovery of which is petitioner's primary objective. The prevalent doctrine is that an action for the
annulment or rescission of a sale of real property does not operate to efface the fundamental and
prime objective and nature of the case, which is to recover said real property. It is a real action.
Respondent Court, therefore, did not err in dismissing the case on the ground of improper venue
(Sec. 2, Rule 4) which was timely raised (Sec. 1, Rule 16). (Punzalan, Jr. v. Vda. de Lacsamana,
121 SCRA 336, [1983]).
Thus, as aptly decided by the Court of Appeals in a decision penned by then Court of Appeals
Associate Justice now Associate Justice of the Supreme Court Carolina C. Griño-Aquino, the
pertinent portion reads: "Since an extrajudicial foreclosure of real property results in a conveyance of
the title of the property sold to the highest bidder at the sale, an action to annul the foreclosure sale
is necessarily an action affecting the title of the property sold. It is therefore a real action which
should be commenced and tried in the province where the property or part thereof lies."
PREMISES CONSIDERED, the instant petition is DENIED for lack of merit and the assailed decision
of the respondent Court of Appeals is AFFIRMED.
SO ORDERED.
G.R. No. 156759 June 5, 2013
ALLEN A. MACASAET, NICOLAS V. QUIJANO, JR., ISAIAS ALBANO, LILY REYES, JANET
BAY, JESUS R. GALANG, AND RANDY HAGOS, Petitioners,
vs.
FRANCISCO R. CO, JR., Respondent.
DECISION
BERSAMIN, J.:
To warrant the substituted service of the summons and copy of the complaint, the serving officer
must first attempt to effect the same upon the defendant in person. Only after the attempt at
personal service has become futile or impossible within a reasonable time may the officer resort to
substituted service.
The Case
Petitioners – defendants in a suit for libel brought by respondent – appeal the decision promulgated
on March 8, 20021 and the resolution promulgated on January 13, 2003,2 whereby the Court of
Appeals (CA) respectively dismissed their petition for certiorari, prohibition and mandamus and
denied their motion for reconsideration. Thereby, the CA upheld the order the Regional Trial Court
(RTC), Branch 51, in Manila had issued on March 12, 2001 denying their motion to dismiss because
the substituted service of the summons and copies of the complaint on each of them had been valid
and effective.3
Antecedents
On July 3, 2000, respondent, a retired police officer assigned at the Western Police District in
Manila, sued Abante Tonite, a daily tabloid of general circulation; its Publisher Allen A. Macasaet; its
Managing Director Nicolas V. Quijano; its Circulation Manager Isaias Albano; its Editors Janet Bay,
Jesus R. Galang and Randy Hagos; and its Columnist/Reporter Lily Reyes (petitioners), claiming
damages because of an allegedly libelous article petitioners published in the June 6, 2000 issue of
Abante Tonite. The suit, docketed as Civil Case No. 00-97907, was raffled to Branch 51 of the RTC,
which in due course issued summons to be served on each defendant, including Abante Tonite, at
their business address at Monica Publishing Corporation, 301-305 3rd Floor, BF Condominium
Building, Solana Street corner A. Soriano Street, Intramuros, Manila.4
In the morning of September 18, 2000, RTC Sheriff Raul Medina proceeded to the stated address to
effect the personal service of the summons on the defendants. But his efforts to personally serve
each defendant in the address were futile because the defendants were then out of the office and
unavailable. He returned in the afternoon of that day to make a second attempt at serving the
summons, but he was informed that petitioners were still out of the office. He decided to resort to
substituted service of the summons, and explained why in his sheriff’s return dated September 22,
2005,5 to wit:
SHERIFF’S RETURN
This is to certify that on September 18, 2000, I caused the service of summons together with copies
of complaint and its annexes attached thereto, upon the following:
1. Defendant Allen A. Macasaet, President/Publisher of defendant AbanteTonite, at Monica

Publishing Corporation, Rooms 301-305 3rd Floor, BF Condominium Building, Solana corner
A. Soriano Streets, Intramuros, Manila, thru his secretary Lu-Ann Quijano, a person of
sufficient age and discretion working therein, who signed to acknowledge receipt thereof.
That effort (sic) to serve the said summons personally upon said defendant were made, but
the same were ineffectual and unavailing on the ground that per information of Ms. Quijano
said defendant is always out and not available, thus, substituted service was applied;
2. Defendant Nicolas V. Quijano, at the same address, thru his wife Lu-Ann Quijano, who
signed to acknowledge receipt thereof. That effort (sic) to serve the said summons
personally upon said defendant were made, but the same were ineffectual and unavailing on
the ground that per information of (sic) his wife said defendant is always out and not
available, thus, substituted service was applied;
3. Defendants Isaias Albano, Janet Bay, Jesus R. Galang, Randy Hagos and Lily Reyes, at
the same address, thru Rene Esleta, Editorial Assistant of defendant AbanteTonite, a person
of sufficient age and discretion working therein who signed to acknowledge receipt thereof.
That effort (sic) to serve the said summons personally upon said defendants were made, but
the same were ineffectual and unavailing on the ground that per information of (sic) Mr.
Esleta said defendants is (sic) always roving outside and gathering news, thus, substituted
service was applied.
Original copy of summons is therefore, respectfully returned duly served.
Manila, September 22, 2000.
On October 3, 2000, petitioners moved for the dismissal of the complaint through counsel’s special
appearance in their behalf, alleging lack of jurisdiction over their persons because of the invalid and
ineffectual substituted service of summons. They contended that the sheriff had made no prior
attempt to serve the summons personally on each of them in accordance with Section 6 and Section
7, Rule 14 of the Rules of Court. They further moved to drop Abante Tonite as a defendant by virtue
of its being neither a natural nor a juridical person that could be impleaded as a party in a civil action.
At the hearing of petitioners’ motion to dismiss, Medina testified that he had gone to the office
address of petitioners in the morning of September 18, 2000 to personally serve the summons on
each defendant; that petitioners were out of the office at the time; that he had returned in the
afternoon of the same day to again attempt to serve on each defendant personally but his attempt
had still proved futile because all of petitioners were still out of the office; that some competent
persons working in petitioners’ office had informed him that Macasaet and Quijano were always out
and unavailable, and that Albano, Bay, Galang, Hagos and Reyes were always out roving to gather
news; and that he had then resorted to substituted service upon realizing the impossibility of his
finding petitioners in person within a reasonable time.
On March 12, 2001, the RTC denied the motion to dismiss, and directed petitioners to file their
answers to the complaint within the remaining period allowed by the Rules of Court,6 relevantly
stating:
Records show that the summonses were served upon Allen A. Macasaet, President/Publisher of
defendant AbanteTonite, through LuAnn Quijano; upon defendants Isaias Albano, Janet Bay, Jesus
R. Galang, Randy Hagos and Lily Reyes, through Rene Esleta, Editorial Assistant of defendant
Abante Tonite (p. 12, records). It is apparent in the Sheriff’s Return that on several occasions, efforts
to served (sic) the summons personally upon all the defendants were ineffectual as they were
always out and unavailable, so the Sheriff served the summons by substituted service.
Considering that summonses cannot be served within a reasonable time to the persons of all the
defendants, hence substituted service of summonses was validly applied. Secretary of the President
who is duly authorized to receive such document, the wife of the defendant and the Editorial
Assistant of the defendant, were considered competent persons with sufficient discretion to realize
the importance of the legal papers served upon them and to relay the same to the defendants
named therein (Sec. 7, Rule 14, 1997 Rules of Civil Procedure).
WHEREFORE, in view of the foregoing, the Motion to Dismiss is hereby DENIED for lack of merit..
Accordingly, defendants are directed to file their Answers to the complaint within the period still open
to them, pursuant to the rules.
SO ORDERED.
Petitioners filed a motion for reconsideration, asserting that the sheriff had immediately resorted to
substituted service of the summons upon being informed that they were not around to personally
receive the summons, and that Abante Tonite, being neither a natural nor a juridical person, could
not be made a party in the action.
On June 29, 2001, the RTC denied petitioners’ motion for reconsideration.7 It stated in respect of the
service of summons, as follows:
The allegations of the defendants that the Sheriff immediately resorted to substituted service of
summons upon them when he was informed that they were not around to personally receive the
same is untenable. During the hearing of the herein motion, Sheriff Raul Medina of this Branch of the
Court testified that on September 18, 2000 in the morning, he went to the office address of the
defendants to personally serve summons upon them but they were out. So he went back to serve
said summons upon the defendants in the afternoon of the same day, but then again he was
informed that the defendants were out and unavailable, and that they were always out because they
were roving around to gather news. Because of that information and because of the nature of the
work of the defendants that they are always on field, so the sheriff resorted to substituted service of
summons. There was substantial compliance with the rules, considering the difficulty to serve the
summons personally to them because of the nature of their job which compels them to be always out
and unavailable. Additional matters regarding the service of summons upon defendants were
sufficiently discussed in the Order of this Court dated March 12, 2001.
Regarding the impleading of Abante Tonite as defendant, the RTC held, viz:
"Abante Tonite" is a daily tabloid of general circulation. People all over the country could buy a copy
of "Abante Tonite" and read it, hence, it is for public consumption. The persons who organized said
publication obviously derived profit from it. The information written on the said newspaper will affect
the person, natural as well as juridical, who was stated or implicated in the news. All of these facts
imply that "Abante Tonite" falls within the provision of Art. 44 (2 or 3), New Civil Code. Assuming
arguendo that "Abante Tonite" is not registered with the Securities and Exchange Commission, it is
deemed a corporation by estoppels considering that it possesses attributes of a juridical person,
otherwise it cannot be held liable for damages and injuries it may inflict to other persons.
Undaunted, petitioners brought a petition for certiorari, prohibition, mandamusin the CA to nullify the
orders of the RTC dated March 12, 2001 and June 29, 2001.
Ruling of the CA
On March 8, 2002, the CA promulgated its questioned decision,8 dismissing the petition for certiorari,
prohibition, mandamus, to wit:
We find petitioners’ argument without merit. The rule is that certiorari will prosper only if there is a
showing of grave abuse of discretion or an act without or in excess of jurisdiction committed by the
respondent Judge. A judicious reading of the questioned orders of respondent Judge would show
that the same were not issued in a capricious or whimsical exercise of judgment. There are factual
bases and legal justification for the assailed orders. From the Return, the sheriff certified that "effort
to serve the summons personally xxx were made, but the same were ineffectual and unavailing xxx.
and upholding the trial court’s finding that there was a substantial compliance with the rules that
allowed the substituted service.
Furthermore, the CA ruled:
Anent the issue raised by petitioners that "Abante Tonite is neither a natural or juridical person who
may be a party in a civil case," and therefore the case against it must be dismissed and/or dropped,
is untenable.
The respondent Judge, in denying petitioners’ motion for reconsideration, held that:
xxxx
Abante Tonite’s newspapers are circulated nationwide, showing ostensibly its being a corporate
entity, thus the doctrine of corporation by estoppel may appropriately apply.
An unincorporated association, which represents itself to be a corporation, will be estopped from

denying its corporate capacity in a suit against it by a third person who relies in good faith on such
representation.
There being no grave abuse of discretion committed by the respondent Judge in the exercise of his
jurisdiction, the relief of prohibition is also unavailable.
WHEREFORE, the instant petition is DENIED. The assailed Orders of respondent Judge are
AFFIRMED.
SO ORDERED.9
On January 13, 2003, the CA denied petitioners’ motion for reconsideration.10
Issues
Petitioners hereby submit that:
1. THE COURT OF APPEALS COMMITTED AN ERROR OF LAW IN HOLDING THAT THE

TRIAL COURT ACQUIRED JURISDICTION OVER HEREIN PETITIONERS.
2. THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR BY SUSTAINING THE

INCLUSION OF ABANTE TONITE AS PARTY IN THE INSTANT CASE.11
Ruling
The petition for review lacks merit.

Jurisdiction over the person, or jurisdiction in personam –the power of the court to render a personal
judgment or to subject the parties in a particular action to the judgment and other rulings rendered in
the action – is an element of due process that is essential in all actions, civil as well as criminal,
except in actions in rem or quasi in rem. Jurisdiction over the defendantin an action in rem or quasi
in rem is not required, and the court acquires jurisdiction over an actionas long as it acquires
jurisdiction over the resthat is thesubject matter of the action. The purpose of summons in such
action is not the acquisition of jurisdiction over the defendant but mainly to satisfy the constitutional
requirement of due process.12
The distinctions that need to be perceived between an action in personam, on the one hand, and an
action inrem or quasi in rem, on the other hand, are aptly delineated in Domagas v. Jensen,13 thusly:
The settled rule is that the aim and object of an action determine its character. Whether a
proceeding is in rem, or in personam, or quasi in rem for that matter, is determined by its nature and
purpose, and by these only. A proceeding in personam is a proceeding to enforce personal rights
and obligations brought against the person and is based on the jurisdiction of the person, although it
may involve his right to, or the exercise of ownership of, specific property, or seek to compel him to
control or dispose of it in accordance with the mandate of the court. The purpose of a proceeding in
personam is to impose, through the judgment of a court, some responsibility or liability directly upon
the person of the defendant. Of this character are suits to compel a defendant to specifically perform
some act or actions to fasten a pecuniary liability on him. An action in personam is said to be one
which has for its object a judgment against the person, as distinguished from a judgment against the
property to determine its state. It has been held that an action in personam is a proceeding to
enforce personal rights or obligations; such action is brought against the person. As far as suits for
injunctive relief are concerned, it is well-settled that it is an injunctive act in personam. In Combs v.
Combs, the appellate court held that proceedings to enforce personal rights and obligations and in
which personal judgments are rendered adjusting the rights and obligations between the affected
parties is in personam. Actions for recovery of real property are in personam.
On the other hand, a proceeding quasi in rem is one brought against persons seeking to subject the
property of such persons to the discharge of the claims assailed. In an action quasi in rem, an
individual is named as defendant and the purpose of the proceeding is to subject his interests
therein to the obligation or loan burdening the property. Actions quasi in rem deal with the status,
ownership or liability of a particular property but which are intended to operate on these questions
only as between the particular parties to the proceedings and not to ascertain or cut off the rights or
interests of all possible claimants. The judgments therein are binding only upon the parties who
joined in the action.
As a rule, Philippine courts cannot try any case against a defendant who does not reside and is not
found in the Philippines because of the impossibility of acquiring jurisdiction over his person unless
he voluntarily appears in court; but when the case is an action in rem or quasi in rem enumerated in
Section 15, Rule 14 of the Rules of Court, Philippine courts have jurisdiction to hear and decide the
case because they have jurisdiction over the res, and jurisdiction over the person of the non-resident
defendant is not essential. In the latter instance, extraterritorial service of summons can be made
upon the defendant, and such extraterritorial service of summons is not for the purpose of vesting
the court with jurisdiction, but for the purpose of complying with the requirements of fair play or due
process, so that the defendant will be informed of the pendency of the action against him and the
possibility that property in the Philippines belonging to him or in which he has an interest may be
subjected to a judgment in favor of the plaintiff, and he can thereby take steps to protect his interest
if he is so minded. On the other hand, when the defendant in an action in personam does not reside
and is not found in the Philippines, our courts cannot try the case against him because of the
impossibility of acquiring jurisdiction over his person unless he voluntarily appears in court.14
As the initiating party, the plaintiff in a civil action voluntarily submits himself to the jurisdiction of the
court by the act of filing the initiatory pleading. As to the defendant, the court acquires jurisdiction
over his person either by the proper service of the summons, or by a voluntary appearance in the
action.15
Upon the filing of the complaint and the payment of the requisite legal fees, the clerk of court
forthwith issues the corresponding summons to the defendant.16 The summons is directed to the
defendant and signed by the clerk of court under seal. It contains the name of the court and the
names of the parties to the action; a direction that the defendant answers within the time fixed by the
Rules of Court; and a notice that unless the defendant so answers, the plaintiff will take judgment by
default and may be granted the relief applied for.17 To be attached to the original copy of the
summons and all copies thereof is a copy of the complaint (and its attachments, if any) and the
order, if any, for the appointment of a guardian ad litem.18
The significance of the proper service of the summons on the defendant in an action in personam
cannot be overemphasized. The service of the summons fulfills two fundamental objectives, namely:
(a) to vest in the court jurisdiction over the person of the defendant; and (b) to afford to the
defendant the opportunity to be heard on the claim brought against him.19 As to the former, when
jurisdiction in personam is not acquired in a civil action through the proper service of the summons
or upon a valid waiver of such proper service, the ensuing trial and judgment are void.20 If the
defendant knowingly does an act inconsistent with the right to object to the lack of personal
jurisdiction as to him, like voluntarily appearing in the action, he is deemed to have submitted himself
to the jurisdiction of the court.21 As to the latter, the essence of due process lies in the reasonable
opportunity to be heard and to submit any evidence the defendant may have in support of his
defense. With the proper service of the summons being intended to afford to him the opportunity to
be heard on the claim against him, he may also waive the process.21 In other words, compliance with
the rules regarding the service of the summons is as much an issue of due process as it is of
jurisdiction.23
Under the Rules of Court, the service of the summons should firstly be effected on the defendant
himself whenever practicable. Such personal service consists either in handing a copy of the
summons to the defendant in person, or, if the defendant refuses to receive and sign for it, in
tendering it to him.24 The rule on personal service is to be rigidly enforced in order to ensure the
realization of the two fundamental objectives earlier mentioned. If, for justifiable reasons, the
defendant cannot be served in person within a reasonable time, the service of the summons may
then be effected either (a) by leaving a copy of the summons at his residence with some person of
suitable age and discretion then residing therein, or (b) by leaving the copy at his office or regular
place of business with some competent person in charge thereof.25 The latter mode of service is
known as substituted service because the service of the summons on the defendant is made
through his substitute.
It is no longer debatable that the statutory requirements of substituted service must be followed
strictly, faithfully and fully, and any substituted service other than that authorized by statute is
considered ineffective.26 This is because substituted service, being in derogation of the usual method
of service, is extraordinary in character and may be used only as prescribed and in the
circumstances authorized by statute.27 Only when the defendant cannot be served personally within
a reasonable time may substituted service be resorted to. Hence, the impossibility of prompt
personal service should be shown by stating the efforts made to find the defendant himself and the
fact that such efforts failed, which statement should be found in the proof of service or sheriff’s
return.28 Nonetheless, the requisite showing of the impossibility of prompt personal service as basis
for resorting to substituted service may be waived by the defendant either expressly or impliedly.29
There is no question that Sheriff Medina twice attempted to serve the summons upon each of
petitioners in person at their office address, the first in the morning of September 18, 2000 and the
second in the afternoon of the same date. Each attempt failed because Macasaet and Quijano were
"always out and not available" and the other petitioners were "always roving outside and gathering
news." After Medina learned from those present in the office address on his second attempt that
there was no likelihood of any of petitioners going to the office during the business hours of that or
any other day, he concluded that further attempts to serve them in person within a reasonable time
would be futile. The circumstances fully warranted his conclusion. He was not expected or required
as the serving officer to effect personal service by all means and at all times, considering that he
was expressly authorized to resort to substituted service should he be unable to effect the personal
service within a reasonable time. In that regard, what was a reasonable time was dependent on the
circumstances obtaining. While we are strict in insisting on personal service on the defendant, we do
not cling to such strictness should the circumstances already justify substituted service instead. It is
the spirit of the procedural rules, not their letter, that governs.30
In reality, petitioners’ insistence on personal service by the serving officer was demonstrably
superfluous. They had actually received the summonses served through their substitutes, as borne
out by their filing of several pleadings in the RTC, including an answer with compulsory counterclaim
ad cautelam and a pre-trial brief ad cautelam. They had also availed themselves of the modes of
discovery available under the Rules of Court. Such acts evinced their voluntary appearance in the
action.
Nor can we sustain petitioners’ contention that Abante Tonite could not be sued as a defendant due
to its not being either a natural or a juridical person. In rejecting their contention, the CA categorized
Abante Tonite as a corporation by estoppel as the result of its having represented itself to the
reading public as a corporation despite its not being incorporated. Thereby, the CA concluded that
the RTC did not gravely abuse its discretion in holding that the non-incorporation of Abante Tonite
with the Securities and Exchange Commission was of no consequence, for, otherwise, whoever of
the public who would suffer any damage from the publication of articles in the pages of its tabloids
would be left without recourse. We cannot disagree with the CA, considering that the editorial box of
the daily tabloid disclosed that basis, nothing in the box indicated that Monica Publishing Corporation
had owned Abante Tonite.
WHEREFORE, the Court AFFIRMS the decision promulgated on March 8, 2002; and ORDERS
petitioners to pay the costs of suit.
SO ORDERED.
[G.R. NO. 152808. September 30, 2005]
ANTONIO T. CHUA, Petitioners, v. TOTAL OFFICE PRODUCTS AND SERVICES

(TOPROS), INC., Respondent.
DECISION
QUISUMBING, J.:
For review on certiorari is the decision1 dated November 28, 2001 of the Court of
Appeals and its resolution2 of April 1, 2002 in CA-G.R. SP No. 62592. The assailed
decision and resolution dismissed the special civil action for certiorari against the orders
of August 9, 20003 and October 6, 20004 issued by Judge Lorifel Lacap Pahimna in Civil
Case No. 67736.
The pertinent facts, based on the records, are as follows:
On December 28, 1999, respondent Total Office Products and Services, Inc., (TOPROS)
lodged a complaint for annulment of contracts of loan and real estate mortgage against
herein petitioner Antonio T. Chua before the Regional Trial Court of Pasig City. The case
was docketed as Civil Case No. 67736 and was raffled to the sala of Judge Lorifel Lacap
Pahimna.
The said suit sought to annul a loan contract allegedly extended by petitioner to
respondent TOPROS in the amount of ten million four hundred thousand pesos
(P10,400,000) and the accessory real estate mortgage contract covering two parcels of
land situated in Quezon City as collateral.
It appeared on the face of the subject contracts that TOPROS was represented by its
president John Charles Chang, Jr. However, TOPROS alleged that the purported loan
and real estate mortgage contracts were fictitious, since it never authorized anybody,
not even its president, to enter into said transaction.
On February 28, 2000, petitioner filed a motion to dismiss on the ground of improper
venue. He contended that the action filed by TOPROS affects title to or possession of
the parcels of land subject of the real estate mortgage. He argued that it should thus
have been filed in the Regional Trial Court of Quezon City where the encumbered real
properties are located, instead of Pasig City where the parties reside.
On August 9, 2000, Judge Pahimna issued an order denying the motion to dismiss. She
reasoned that the action to annul the loan and mortgage contracts is a personal action
and thus, the venue was properly laid in the RTC of Pasig City where the parties reside.
Petitioner moved for a reconsideration of the said order, which Judge Pahimna denied in
its order of October 6, 2000. Hence, petitioner filed with the Court of Appeals a special
civil action for certiorari alleging:
THE RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF DISCRETION IN

DISREGARDING THE RULING OF THE SUPREME COURT IN PASCUAL v. PASCUAL
REGARDING THE RULE ON PROPER VENUE, AND CONSEQUENTLY ADJUDGING TO BE A
PERSONAL ACTION A CIVIL COMPLAINT FOR THE ANNULMENT OF AN ALLEGEDLY
FICTITIOUS CONTRACT.5
The Court of Appeals dismissed said petition in its decision dated November 28, 2001.
It held that the authorities relied upon by petitioner, namely Pascual v.
Pascual6 and Banco EspaÃ±ol-Filipino v. Palanca,7 are inapplicable in the instant case.
The appellate court instead applied Hernandez v. Rural Bank of Lucena, Inc.8 wherein
we ruled that an action for the cancellation of a real estate mortgage is a personal
action if the mortgagee has not foreclosed the mortgage and the mortgagor is in
possession of the premises, as neither the mortgagor's title to nor possession of the
property is disputed.
Dissatisfied, petitioner filed a motion for reconsideration, which the Court of Appeals
denied for lack of merit in its resolution of April 1, 2002.
Undeterred, petitioner now comes to us on a Petition for Review raising the following
issues:
WHETHER AN ACTION TO ANNUL A LOAN AND MORTGAGE CONTRACT DULY ALLEGED

AS 'FICTITIOUS' FOR BEING WITH ABSOLUTELY NO CONSIDERATION IS A PERSONAL
ACTION OR REAL ACTION? cralawlibrary
WHETHER IN AN ACTION TO ANNUL A LOAN AND MORTGAGE CONTRACT DULY

ALLEGED AS 'FICTITIOUS' FOR BEING WITH ABSOLUTELY NO CONSIDERATION, THE
PERSON ALLEGED TO HAVE '[LACKED] AUTHORITY' TO ENTER INTO SAID CONTRACTS
IS AN INDISPENSABLE PARTY?9
Petitioner contends that Hernandez should not be applied here because in the said
case: (1) venue was improperly laid at the outset; (2) the complaint recognized the
validity of the principal contract involved; and (3) the plaintiff sought to compel
acceptance by the defendant of plaintiff's payment of the latter's mortgage debt. He
insists that the Pascual case should be applied instead. He invokes our pronouncement
in Pascual, to wit:
'It appearing, however, that the sale is alleged to be fictitious, with absolutely no
consideration, it should be regarded as a non-existent, not merely null, contract'. And
there being no contract between the deceased and the defendants, there is in truth
nothing to annul by action. The action brought cannot thus be for annulment of
contract, but is one for recovery of a fishpond, a real action that should be, as it has
been, brought in Pampanga, where the property is located'.10
Petitioner likewise cites the Banco EspaÃ±ol-Filipino case, thus:
Where the defendant in a mortgage foreclosure lives out of the Islands and refuses to
appear or otherwise submit himself to the authority of the court, the jurisdiction of the
latter is limited to the mortgaged property, with respect to which the jurisdiction of the
court is based upon the fact that the property is located within the district and that the
court, under the provisions of law applicable in such cases, is vested with the power to
subject the property to the obligation created by the mortgage. In such case personal
jurisdiction over the nonresident defendant is nonessential and in fact cannot be
acquired.11
Petitioner also alleges that John Charles Chang, Jr., the president of TOPROS, who
allegedly entered into the questioned loan and real estate mortgage contracts, is an
indispensable party who has not been properly impleaded.
TOPROS, however, maintains that the appellate court correctly sustained the lower
court's finding that the instant complaint for annulment of loan and real estate
mortgage contracts is a personal action. TOPROS points out that a complaint for the
declaration of nullity of a loan contract for lack of consent and consideration remains a
personal action even if the said action will necessarily affect the accessory real estate
mortgage.
TOPROS argues that Pascual is inapplicable because the subject contract therein was a
contract of sale of a parcel of land where title and possession were already transferred
to the defendant. TOPROS further contends that Banco EspaÃ±ol-Filipino is also
inapplicable since the personal action filed therein was one which affected the personal
status of a nonresident defendant.
Considering the facts and the submission of the parties, we find the petition bereft of
merit.
Well-settled is the rule that an action to annul a contract of loan and its accessory real
estate mortgage is a personal action. In a personal action, the plaintiff seeks the
recovery of personal property, the enforcement of a contract or the recovery of
damages.12 In contrast, in a real action, the plaintiff seeks the recovery of real
property, or, as indicated in Section 2 (a), Rule 4 of the then Rules of Court, a real
action is an action affecting title to real property or for the recovery of possession, or
for partition or condemnation of, or foreclosure of mortgage on, real property.13
In the Pascual case, relied upon by petitioner, the contract of sale of the fishpond was
assailed as fictitious for lack of consideration. We held that there being no contract to
begin with, there is nothing to annul. Hence, we deemed the action for annulment of
the said fictitious contract therein as one constituting a real action for the recovery of
the fishpond subject thereof.
We cannot, however, apply the foregoing doctrine to the instant case. Note that
in Pascual, title to and possession of the subject fishpond had already passed to the
vendee. There was, therefore, a need to recover the said fishpond. But in the instant
case, ownership of the parcels of land subject of the questioned real estate mortgage
was never transferred to petitioner, but remained with TOPROS. Thus, no real action for
the recovery of real property is involved. This being the case, TOPROS' action for
annulment of the contracts of loan and real estate mortgage remains a personal action.
Petitioner's reliance on the Banco EspaÃ±ol-Filipino case is likewise misplaced. That

case involved a foreclosure of real estate mortgage against a nonresident. We held
therein that jurisdiction is determined by the place where the real property is located
and that personal jurisdiction over the nonresident defendant is nonessential and, in
fact, cannot be acquired.
Needless to stress, the instant case bears no resemblance to the Banco EspaÃ±ol-

Filipino case. In the first place, this is not an action involving foreclosure of real estate
mortgage. In the second place, none of the parties here is a nonresident. We find no
reason to apply here our ruling in Banco EspaÃ±ol-Filipino.
The Court of Appeals finds that Hernandez v. Rural Bank of Lucena, Inc. provides the
proper precedent in this case. In Hernandez, appellants contended that the action of
the Hernandez spouses for the cancellation of the mortgage on their lots was a real
action affecting title to real property, which should have been filed in the place where
the mortgaged lots were situated. Rule 4, Section 2 (a), of the then Rules of Court, was
applied, to wit:
SEC. 2. Venue in Courts of First Instance. - (a) Real actions. - Actions affecting title to,
or for recovery of possession, or for partition or condemnation of, or foreclosure of
mortgage on, real property, shall be commenced and tried in the province where the
property or any part thereof lies.
The Court pointed out in the Hernandez case that with respect to mortgage, the rule on
real actions only mentions an action for foreclosure of a real estate mortgage. It does
not include an action for the cancellation of a real estate mortgage. Exclusio unios est
inclusio alterius. The latter thus falls under the catch-all provision on personal actions
under paragraph (b) of the above-cited section, to wit:
SEC. 2 (b) Personal actions. - All other actions may be commenced and tried where the
defendant or any of the defendants resides or may be found, or where the plaintiff or
any of the plaintiffs resides, at the election of the plaintiff.
In the same vein, the action for annulment of a real estate mortgage in the present
case must fall under Section 2 of Rule 4, to wit:
SEC. 2. Venue of personal actions. - All other actions may be commenced and tried
where the plaintiff or any of the principal plaintiffs resides, or where the defendant or
any of the principal defendants resides, or in the case of a non-resident defendant
where he may be found, at the election of the plaintiff. 14
Thus, Pasig City, where the parties reside, is the proper venue of the action to nullify
the subject loan and real estate mortgage contracts. The Court of Appeals committed
no reversible error in upholding the orders of the Regional Trial Court denying
petitioner's motion to dismiss the case on the ground of improper venue.
Anent the second issue, Section 7, Rule 3 of the Revised Rules of Court provides:
SEC. 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. (Emphasis ours)
The presence of indispensable parties is necessary to vest the court with jurisdiction.
The absence of an indispensable party renders all subsequent actuations of the court
null and void, because of that court's want of authority to act, not only as to the absent
parties but even as to those present. 15 Thus, whenever it appears to the court in the
course of a proceeding that an indispensable party has not been joined, it is the duty of
the court to stop the trial and order the inclusion of such party. 16
A person is not an indispensable party, however, if his interest in the controversy or

subject matter is separable from the interest of the other parties, so that it will not
necessarily be directly or injuriously affected by a decree which does complete justice
between them.17
Is John Charles Chang, Jr., the president of TOPROS who allegedly entered into the
disputed contracts of loan and real estate mortgage, an indispensable party in this
case?cralawlibrary
We note that although it is Chang's signature that appears on the assailed real estate
mortgage contract, his participation is limited to being a representative of TOPROS,
allegedly without authority. The document18 which constitutes as the contract of real
estate mortgage clearly points to petitioner and TOPROS as the sole parties-in-interest
to the agreement as mortgagee and mortgagor therein, respectively. Any rights or
liabilities arising from the said contract would therefore bind only the petitioner and
TOPROS as principal parties. Chang, acting as mere representative of TOPROS, acquires
no rights whatsoever, nor does he incur any liabilities, arising from the said contract
between petitioner and TOPROS. Certainly, in our view, the only indispensable parties
to the mortgage contract are petitioner and TOPROS alone.
We thus hold that John Charles Chang, Jr., is not an indispensable party in Civil Case
No. 67736. This is without prejudice to any separate action TOPROS may institute
against Chang, Jr., in a proper proceeding.
WHEREFORE, the petition is DENIED. The assailed decision dated November 28, 2001
and resolution dated April 1, 2002 of the Court of Appeals upholding the Orders of
Judge Lorifel Lacap Pahimna are AFFIRMED.
No pronouncement as to costs.
SO ORDERED.
G.R. No. L-49475 September 28, 1993
JORGE C. PADERANGA, petitioner,
vs.
Hon. DIMALANES B. BUISSAN, Presiding Judge, Court of First Instance of Zamboanga del
Norte, Branch III and ELUMBA INDUSTRIES COMPANY, represented by its General Manager,
JOSE J. ELUMBA, respondents.
A.E. Dacanay for petitioner.
Uldarico Mejorada & Associates for private respondent.
BELLOSILLO, J.:
We are called upon in this case to determine the proper venue of an action to fix the period of a
contract of lease which, in the main, also prays for damages.
Sometime in 1973, petitioner JORGE C. PADERANGA and private respondent ELUMBA

INDUSTRIES COMPANY, a partnership represented by its General Manager JOSE J. ELUMBA,
entered into an oral contract of lease for the use of a commercial space within a building owned by
petition in Ozamiz City. The lease was for an indefinite period although the rent of P150.00 per
1
month was paid on a month-to-month basis. ELUMBA INDUSTRIES COMPANY utilized the area
under lease as the Sales Office of Allied Air Freight in Ozamiz City.
On 4 April 1977, PADERANGA subdivided the leased premises into two (2) by constructing a
partition wall in between. He then took possession of the other half, which repossession was said to
have been undertaken with the acquiescence of the local manager of ELUMBA, although private
2
respondent maintains that this is not the case. At any rate, the validity of the repossession is not
3
here in issue.
On 18 July 1977, private respondent instituted an action for damages which, at the same time,
4
prayed for the fixing of the period of lease at five (5) years, before the then court of First Instance of
Zamboanga del Norte based in Dipolog City. Petitioner, a resident of Ozamiz City, moved for its
5
dismissal contending that the action was a real action which should have been filed with the Court of
First Instance of Misamis Occidental stationed in Ozamiz City where the property in question was
situated.
On 6 November 1978, respondent Judge Dimalanes B. Buissan denied the Motion to Dismiss and
held that Civil Case No. 2901 merely involved the enforcement of the contract of lease, and while
affecting a portion of real property, there was no question of ownership raised. Hence, venue was
6
properly laid.
Petitioner pleaded for reconsideration of the order denying his Motion to Dismiss. He contended that
while the action did not involve a question of ownership, it was nevertheless seeking recovery of
possession; thus, it was a real action which, consequently, must be filed in Ozamiz City. 7
On 4 December 1978, respondent judge denied reconsideration. While admitting that Civil Case No.
8
2901 did pray for recovery of possession, he nonetheless ruled that this matter was not the main
issue at hand; neither was the question of ownership raised. Not satisfied, petitioner instituted the
present recourse.
PADERANGA argues that inasmuch as ELUMBA seeks to recover possession of the portion
surrendered to him by the local manager of private respondent, as well as to fix the period of lease
at five (5) years, Dipolog City could not be the proper venue of the action. it being a real action,
venue is laid in the court having jurisdiction over the territory in which the property lies.
ELUMBA counters that the present action is chiefly for damages arising from an alleged breach in
the lease contract; hence, the issue of recovery of possession is merely incidental. ELUMBA further
argues that the action is one in personam and not in rem. Therefore venue may be laid in the place
where plaintiff or defendant resides at the option of plaintiff.
Private respondent appears to be confused over the difference between personal and real
actions vis-a-vis actions in personam and in rem. The former determines venue; the latter, the
binding effect of a decision the court may render over the party, whether impleaded or not.
In the case before us, it is indubitable that the action instituted by private respondent against
petitioner affects the parties alone, not the whole world. Hence, it is an action in personam, i.e., any
judgment therein is binding only upon the parties properly impleaded. However, this does not
9
automatically mean that the action for damages and to fix the period of the lease contract is also a
personal action. For, a personal action may not at the same time be an action in rem. In Hernandez
v. Rural Bank of Lucena, Inc., we held thus —
10
In a personal action, the plaintiff seeks the recovery of personal property, the
enforcement of a contract or the recovery of damages. In a real action, the plaintiff
seeks the recovery of real property, or, as indicated in section 2(a) of Rule 4, a real
action is an action affecting title to real property or for the recovery of possession, or
for partition or condemnation of, or foreclosure of a mortgage on, real property.
An action in personam is an action against a person on the basis of his personal

liability, while an action in rem is an action against the thing itself, instead of against
the person. Hence, a real action may at the same time be an action in personam and
not necessarily an action in rem.
Consequently, the distinction between an action in personam and an action in rem for purposes of

determining venue is irrelevant. Instead, it is imperative to find out if the action filed is a personal
action or real action. After all, personal actions may be instituted in the Regional Trial Court (then
Court of First Instance) where the defendant or any of the defendants resides or may be found, or
where the plaintiff or any of the plaintiffs resides, at the election of the plaintiff. On the other hand,
11
real actions should be brought before the Regional Trial Court having jurisdiction over the territory in
which the subject property or part thereof lies. 12
While the instant action is for damages arising from alleged breach of the lease contract, it likewise
prays for the fixing of the period of lease at five (5) years. If found meritorious, private respondent
will be entitled to remain not only as lessee for another five (5) years but also to the recovery of the
portion earlier taken from him as well. This is because the leased premises under the original
contract was the whole commercial space itself and not just the subdivided portion thereof.
While it may be that the instant complaint does not explicitly pray for recovery of possession, such is
the necessary consequence thereof. The instant action therefore does not operate to efface the
13
fundamental and prime objective of the nature of the case which is to recover the one-half portion
repossessed by the lessor, herein petitioner. Indeed, where the ultimate purpose of an action
14
involves title to or seeks recovery of possession, partition or condemnation of, or foreclosure of

mortgage on, real property, such an action must be deemed a real action and must perforce be
15
commenced and tried in the province where the property or any part thereof lies.
Respondent judge, therefore, in denying petitioner's Motion to Dismiss gravely abused his discretion
amounting to lack or excess of jurisdiction.
WHEREFORE, the Petition for Prohibition is GRANTED. The Orders of 6 November 1978 and 4
December 1978 of respondent Judge Dimalanes B. Buissan are SET ASIDE. The branch of the
Regional Trial Court of Dipolog City where Civil Case No. 2901 may be presently assigned is
DIRECTED to DISMISS the case for improper venue. This decision is immediately executory.
Costs against private respondent ELUMBA INDUSTRIES COMPANY.

SO ORDERED.
CAYETANO DE LA CRUZ, Plaintiff-Appellee, vs. EL SEMINARIO DE LA ARCHIDIOCESIS

DE MANILA, ET AL., Defendants-Appellants.
The appellee, Cayetano de la Cruz, was a member and the president of a Methodist
Episcopal religious association at Dinalupijan, Province of Bataan, Philippine Islands. The
members of this association, including Cayetano de la Cruz, having decided to lease a
building site and erect thereon a chapel, made voluntary contributions for that purpose,
Cayetano de la Cruz being among those who contributed. Cayetano de la Cruz, as such
member and president, was then authorized by the association to lease a certain building
site and to use the funds contributed for the purpose of constructing a chapel. So on the
17th of May, 1907, he leased from one J. C. Miller, the agent of the appellant, His Grace
Jeremiah J. Harty, Archbishop of Manila and administrator of the hacienda of Dinalupijan,
for a period of two years, a certain lot or parcel of land, being a part of that hacienda and
which is fully described in the written contract of lease, agreeing to pay as rental P2 per
year, the first year's rent to be paid in advance. On the execution of this lease Cayetano de
la Cruz, as member and president of the Methodist Episcopal association, was placed in
possession of this lot or building site and proceeded to construct thereon a chapel for the
use of the said religious association. About the time this chapel was completed an action of
forcible entry and detainer was commenced by one Raymundo Sinsuangco in the justice of
the peace court of Dinalupijan, in which Cayetano de la Cruz, as lessee of the lot upon
which the chapel was constructed, and J. C. Miller, as agent and representative of the
appellants, who, in such capacity executed said lease, as lessor, were made defendants.
Judgment was rendered against the defendants in the action. The appellants in the case at
bar were duly notified of the judgment of the justice of the peace and were requested to
appeal to the Court of First Instance. No appeal was taken and the judgment becoming final
was executed in such a manner that the above-mentioned chapel was completely
destroyed. Subsequently thereto, and on the 21st of October, 1907, Cayetano de la Cruz
commenced this action in the Court of First Instance of the city of Manila against the
appellants to recover the sum of P2,000 as damages for a breach of the rental contract. To
this complaint the appellants, through their attorneys, presented a demurrer, based upon
the following grounds: (1) That the Court of First Instance of the city of Manila was without
jurisdiction to try and determine this action for the reason that damages for injuries caused
to real property situated in the Province of Bataan is sought to be recovered; and (2) the
complaint fails to allege facts sufficient to constitute a cause of action. This demurrer was
overruled, the appellants duly noting their exception.chanroblesvirtualawlibrary chanrobles
virtual law library
After all the evidence had been submitted by both parties, the appellee, after due notice to
the appellants, presented an amended complaint, to conform, as he alleged, with the
agreed statement of facts and the admissions made by the appellants in their answer. This
amended complaint was admitted by the court without objection on the part of the
appellants. The amended complaint is the same as the original complaint, with the following
exceptions: (1) A number of unnamed person were made parties plaintiff; (2) in paragraph
2 of the amended complaint it is alleged that Cayetano de la Cruz was the president, agent,
and member of the Methodist Episcopal religious association: and (3) a judgment for only
P402 was asked.chanroblesvirtualawlibrary chanrobles virtual law library
The court below on the 29th of March, 1909, rendered judgment in favor of the appellees
and against the appellants for the sum of P402, P2 being the rent for the first year paid in
advance, and the P400 being the agreed value of the chapel which was destroyed by the
sheriff in executing the judgment rendered by the justice of the
peace.chanroblesvirtualawlibrary chanrobles virtual law library
The appellants after noting their exception to the judgment and making a motion for a new
trial, which motion was overruled and exception thereto noted, appealed to this court, and
now insist: chanrobles virtual law library
1. That as this action is one for damages to real estate situated in the Province of Bataan,
under the provisions of section 377 of the Code of Civil Procedure the Court of First Instance
of the city of Manila had no jurisdiction; chanrobles virtual law library
2. The court below erred in admitting the amended complaint by which the other members
of the religious association, jointly interested with Cayetano de la Cruz, were made parties
plaintiff; and, chanrobles virtual law library
3. That the appellants are not liable for the consequences of the judgment of the justice of
the peace.chanroblesvirtualawlibrary chanrobles virtual law library
The demurrer was properly overruled. This is not an action to recover damages to real
estate; it is an action for breach of covenant in a lease. The fact that the damages to real
estate are involved, as an incident to the breach of the contract, does not change the
character of the action. Such an action is personal and transistory. The rule is well stated in
the case of Neil vs. Owen (3 Tex., 145), wherein the court said (p. 146):
If the action is founded on privity of contract between the parties, then the action whether
debt or covenant, is transitory. But if there is no privity of contract and the action is
founded on privity of estate only, such a covenant that runs with the land in the hands of
the remote grantees, then the action is local and must be brought in the country wherein
the land lies.chanroblesvirtualawlibrary chanrobles virtual law library
In an action on a covenant contained in a lease, whether begun by the lessor against the
lessee, or by the lessee against the lessor, the action is transitory because it is founded on a
mere privity of contract. (Thursby vs. Plant, cited in vol. 5, Ency. Plead. & Prac., p.
362.) chanrobles virtual law library
In general, also, actions which are founded upon contracts are transitory. In an action upon
a lease for nonpayment of rent or other breach of covenants, when the action is founded on
the privity of contract it is transitory and the venue may laid in any county. (22 Ency. Plead.
& Prac., pp. 782-783.)
Therefore, section 377 of the Code of Civil Procedure, which provides, among other things,
that actions to recover damages for injuries to real estate shall be brought in the province
where the land, or a part thereof, is situated, is not applicable. (Molina vs. De la Riva, 6
Phil. Rep., 12.) The amended complaint clearly states facts sufficient to constitute a cause
of action. (Sec. 90, Code of Civil Procedure.) chanrobles virtual law library
The defendants in the second assignment of error assert that the plaintiff ought not to have
been allowed to amend his complaint so as to make him the representative of all the
persons interested in the subject matter of this action. We are of the opinion that such
amendment was properly allowed. Section 110 of the Code of Civil Procedure is exceedingly
broad in its term and there is no disposition in this court to narrow its term or meaning. We
are also of the opinion that this is particularly the class of action to which section 118 of the
Code of Civil Procedure refers. It would be exceedingly difficult and expensive to require
that all persons interested be made parties plaintiff. To avoid this was the very purpose in
enacting section 118. The plaintiff, as appears from the record, is the person chosen by the
members of the association in question to look after and represent their interest and it is
correspondingly appropriate that he should represent and act for them in this action. In
permitting this court is not thwarting their will or endangering their interest, but, rather, is
carrying out their desires and purposes as they have already expressed
them.chanroblesvirtualawlibrary chanrobles virtual law library
In the third assignment of error it is insisted that the appellants are not liable for the
consequences of the judgment of the justice of the peace, for the reason that according to
that judgment the plaintiff, in violation of the rights of Raymundo Sinsuangco, entered upon
the lot in question. It is argued that the plaintiff should not have entered into possession of
this lot in violation of the rights of Sinsuangco, but that he should have acquired possession
by due judicial process, and that having entered into possession in this manner he must
suffer the consequences of his illegal acts. In this we can not agree. When this rental
contract was executed the lot in question was vacant. The agent, Miller, led the plaintiff to
believe that he could place him in legal possession of the lot. It was upon this theory that
the plaintiff entered into this contract and paid the rent for the first year. The record does
not affirmatively show that Miller placed the plaintiff in possession of this lot, but in the
absence of proof to the contrary we think it fair to presume that this occurred. Miller then
placed the plaintiff in possession of this lot, but not in the legal possession of same. He
himself did not have the legal possession as was shown by the proof before the justice of
the peace. Sinsuangco was the person who was in the actual possession and Miller should
have known this and he should have known at the time he entered into the contract with
the plaintiff that he could not place the plaintiff in legal, peaceful, and quiet possession of
this lot. The plaintiff took possession under these circumstances and proceeded to construct
the chapel, which was afterwards destroyed in the execution of the judgment of the justice
of the peace. In the contract entered into between Miller and the plaintiff, it was Miller's
duty to place the plaintiff legally in possession of this lot and maintain him in the peaceful
and quiet possession of the same during the entire period of the
contract.chanroblesvirtualawlibrary chanrobles virtual law library
The rights and obligations of lessor and lessee are treated in articles 1554 to 1574,
inclusive, of the Civil Code. Article 1554 provides:
The lessor is obligated:
xxx xxx xxxchanrobles virtual law library
3. To maintain the lessee in the peaceful enjoyment of the premises for the entire period of
the contract.
Article 1568 is as follows:
If the thing leased is lost or any of the contracting parties do not comply with what has
been stipulated, the provisions of article 1182 and 1183 shall be respectively observed.
Article 1101 provides:
Those who in fulfilling their obligations are guilty of fraud, negligence, or delay, and those
who in any manner whatsoever act in contravention of the stipulations of the same, shall be
subject to indemnify for the losses and damages caused thereby.
Under this contract of lease it was the duty of the defendants to give the plaintiff the legal
possession of the premises. This they did not do.chanroblesvirtualawlibrary chanrobles
virtual law library
The defendants failed in the performance of their contract, and, as we have seen by article
1101 of the Civil Code, the person who fails in the performance of his obligations shall be
subject to indemnify for the losses and damages caused thereby. "The true measure of
damages for the breach of such a contract is what the plaintiff has lost by the breach."
(Lock vs. Furze, L. R. 1, C. P., 441; Dexter vs. Manley, 4 Cush. (Mass.), 14.) chanrobles
virtual law library
The sum of P402, in our opinion, not being excessive damages for the injuries caused by the
breach of contract on the part of the defendants, the judgment should be and the same is
hereby affirmed, with costs against the appellants. So ordered.
EMERGENCY LOAN PAWNSHOP INCORPORATED and DANILO R.

NAPALA, Petitioners, v. THE COURT OF APPEALS (Tenth Division) and
TRADERS ROYAL BANK, Respondents.
DECISION
PARDO, J.:
May an appeal be taken from a decision of the Regional Trial Court denying a motion to
dismiss the complaint on the ground of improper venue? If not, will certiorari lie? chanrob1es virtua1 1aw 1ibrary
The case before the Court is a petition for review on certiorari assailing the decision of
the Court of Appeals, 1 granting respondent’s petition for certiorari and dismissing the
complaint below on the ground of improper venue.
On January 18, 1996, Traders Royal Bank (TRB for brevity) sold in favor of petitioner
Emergency Loan Pawnshop Incorporated (ELPI for brevity) a parcel of land located at
Km. 3 Asin, Baguio City for Five Hundred Thousand Pesos (P500,000.00). 2
At the time of the sale, TRB misrepresented to ELPI that the subject property was a
vacant residential lot valued at P600.00 to P800.00 per square meter, with a usable
land area of 1,143.75 square meters (approximately 75% of the land area of 1,525 sq.
m.) without any illegal occupants or squatters, when it truth the subject property was
dominantly a public road with only 140 square meters usable area.
ELPI, after having spent to fully ascertain the actual condition of the property,
demanded from TRB the rescission and cancellation of the sale of the property. TRB
refused, hence, on April 16, 1996, ELPI filed with the Regional Trial Court, Davao,
Branch 17, a complaint for annulment of sale and damages against TRB. 3
On August 27, 1996, TRB filed a Motion to Dismiss 4 the complaint on the ground of
improper venue. On September 18, 1996 the trial court denied the motion to dismiss. 5
On October 21, 1996, TRB filed a motion for reconsideration. 6 On November 14, 1996,
the trial court denied the motion. 7
On January 15, 1997, TRB elevated the case to the Court of Appeals by petition
for certiorari and prohibition with preliminary injunction or temporary restraining order,
contending that the trial court committed a grave abuse of discretion in denying its
motion to dismiss the complaint on the ground of improper venue. 8
After due proceedings, on March 11, 1997, the Court of Appeals promulgated its
decision, the dispositive portion of which reads: jgc:chanrobles.com.ph
"WHEREFORE, finding merit in the petition, the Orders dated September 18,1996 and
November 14, 1996 are hereby ANNULLED and SET ASIDE and Civil Case No. 24, 317-
96 is hereby DISMISSED on ground of improper venue." 9
Hence, this petition. 10
Petitioners seek to set aside the decision of the Court of Appeals alleging that: chanrob1es virtual 1aw library
1. The Court of Appeals erred in entertaining the petition for certiorari and prohibition,

for lack of jurisdiction; chanrob1es virtua1 1aw 1ibrary
2. The Court of Appeals erred in ruling that the Regional Trial Court erred in not
dismissing the complaint for improper venue. 11
According to petitioners, the determination of whether the venue of an action was

improperly laid was a question of law, thus, the Court of Appeals had no jurisdiction to
entertain the petition for certiorari and prohibition, which involved pure questions of
law.
Petitioners further alleged that an order denying a motion to dismiss is interlocutory in

nature that can not be the subject of an appeal and can not be even reviewed by a
special civil action for certiorari.
We find the petition not meritorious.
The general rule is that the denial of a motion to dismiss a complaint is an interlocutory
order and, hence, cannot be appealed or questioned via a special civil action
of certiorari until a final judgment on the merits of the case is rendered. 12
The remedy of the aggrieved party is to file an answer to the complaint and to
interpose as defenses the objections raised in his motion to dismiss, proceed to trial,
and in case of an adverse decision, to elevate the entire case by appeal in due course.
However, the rule is not ironclad. Under certain situations, recourse to certiorari or
mandamus is considered appropriate, that is, (a) when the trial court issued the order
without or in excess of jurisdiction; (b) where there is patent grave abuse of discretion
by the trial court; or, (c) appeal would not prove to be a speedy and adequate remedy
as when an appeal would not promptly relieve a defendant from the injurious effects of
the patently mistaken order maintaining the plaintiff’s baseless action and compelling
the defendant needlessly to go through a protracted trial and clogging the court dockets
by another futile case." 13
In the case at bar, we agree with the Court of Appeals that the trial court erred
grievously amounting to ousting itself of jurisdiction. The motion of respondent TRB was
well founded because venue was clearly improperly laid. The action in the Regional Trial
Court was for annulment of sale involving a parcel of land located at Km. 3 Asin Road,
Baguio City. The venue of such action is unquestionably within the territorial jurisdiction
of the proper court where the real property or part thereof lies. 14 An action affecting
title to real property, or for recovery of, or foreclosure of mortgage on real property,
shall be commenced and tried in the proper court having jurisdiction over the area
where the real property or any part thereof lies. 15
Hence, the case at bar clearly falls within the exceptions to the rule. The Regional Trial
Court has committed a palpable and grievous error amounting to lack or excess of
jurisdiction in denying the motion to dismiss the complaint on the ground of improper
venue. chanrob1es virtua1 1aw 1ibrary
WHEREFORE, the Court denies the petition and affirms the decision of the Court of
Appeals in CA-G. R. SP No. 43095, in toto.
No costs.
SO ORDERED.
Rule 1 Sec 3(D)
G.R. No. 172172 February 24, 2009
SPS. ERNESTO V. YU and ELSIE ONG YU, Petitioners,

vs.
BALTAZAR N. PACLEB, (Substituted by ANTONIETA S PACLEB, LORNA PACLEB-
GUERRERO, FLORENCIO C. PACLEB, and MYRLA C. PACLEB), Respondents.
DECISION
PUNO, C.J.:
Before the Court is a Petition filed under Rule 45 of the Rules of Court assailing: (i) the
Decision1 dated August 31, 2005 of the Court of Appeals in CA-G.R. CV No. 78629 setting aside the
Decision2 dated December 27, 2002 of the Regional Trial Court in Civil Case No. 1325-96; and (ii)
the Resolution3 dated April 3, 2006 of the Court of Appeals denying reconsideration of the said
decision.
The facts are well established.
Respondent Baltazar N. Pacleb and his late first wife, Angelita Chan, are the registered owners of an
18,000-square meter parcel of land in Barrio Langcaan, Dasmariñas, Cavite, covered by Transfer
Certificate of Title (TCT) No. T-1183754 (Langcaan Property).
In 1992, the Langcaan Property became the subject of three (3) documents purporting to transfer its
ownership. On February 27, 1992, a Deed of Absolute Sale5 was entered into between Spouses
Baltazar N. Pacleb and Angelita Chan and Rebecca Del Rosario. On May 7, 1992, a Deed of
Absolute Sale6 was entered into between Rebecca Del Rosario and Ruperto L. Javier (Javier). On
November 10, 1992, a Contract to Sell7 was entered into between Javier and petitioner spouses
Ernesto V. Yu and Elsie Ong Yu. In their contract, petitioner spouses Yu agreed to pay Javier a total
consideration of ₱900,000. Six hundred thousand pesos (₱600,000) (consisting of ₱200,000 as
previous payment and ₱400,000 to be paid upon execution of the contract) was acknowledged as
received by Javier and ₱300,000 remained as balance. Javier undertook to deliver possession of the
Langcaan Property and to sign a deed of absolute sale within thirty (30) days from execution of the
contract.
All the aforementioned sales were not registered.
On April 23, 1993, petitioner spouses Yu filed with the Regional Trial Court of Imus, Cavite, a
Complaint8 for specific performance and damages against Javier, docketed as Civil Case No. 741-
93, to compel the latter to deliver to them ownership and possession, as well as title to the Langcaan
Property. In their Complaint, they alleged that Javier represented to them that the Langcaan
Property was not tenanted. However, after they already paid ₱200,000 as initial payment and
entered into an Agreement dated September 11, 1992 for the sale of the Langcaan Property, they
discovered it was tenanted by Ramon C. Pacleb (Ramon).9 Petitioner spouses demanded the
cancellation of their agreement and the return of their initial payment. Thereafter, petitioner spouses
and Javier verified from Ramon if he was willing to vacate the property and the latter was agreeable.
Javier then promised to make arrangements with Ramon to vacate the property and to pay the latter
his disturbance compensation. Hence, they proceeded to enter into a Contract to Sell canceling the
Agreement mentioned. However, Javier failed to comply with his obligations.
Javier did not appear in the proceedings and was declared in default. On September 8, 1994, the
trial court rendered a Decision,10 the dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered for the plaintiff and against the defendant based on the
sale of subject parcel of land to the former who is entitled thereby to the ownership and possession
thereof from the said defendant who is further directed to pay damages of Thirty Thousand Pesos
(₱30,000.00) including attorney’s fees and expenses incurred by the plaintiff in this case as a
consequence.
The defendant is further directed to deliver the certificate of title of the land to the plaintiff who is
entitled to it as transferee and new owner thereof upon payment by the plaintiff of his balance of the
purchase price in the sum of Three Hundred Thousand Pesos (₱300,000.00) with legal interest from
date.
SO ORDERED.
The said Decision and its Certificate of Finality11 were annotated on TCT No. T-118375 as Entry No.
2676-7512 and Entry No. 2677-75,13 respectively.
On March 10, 1995, petitioner spouses and Ramon and the latter’s wife, Corazon Bodino, executed
a "Kusangloob na Pagsasauli ng Lupang Sakahan at Pagpapahayag ng Pagtalikod sa
Karapatan."14 Under the said agreement, petitioner spouses paid Ramon the amount of ₱500,000 in
exchange for the waiver of his tenancy rights over the Langcaan Property.
On October 12, 1995, respondent filed a Complaint15 for annulment of deed of sale and other
documents arising from it, docketed as Civil Case No. 1199-95. He alleged that the deed of sale
purportedly executed between him and his late first wife and Rebecca Del Rosario was spurious as
their signatures thereon were forgeries. Respondent moved to have summons served upon Rebecca
Del Rosario by publication since the latter’s address could not be found. The trial court, however,
denied his motion.16 Respondent then moved to dismiss the case, and the trial court granted the
motion in its Order17 dated April 11, 1996, dismissing the case without prejudice.
Meanwhile, on November 23, 1995, petitioner spouses filed an action for forcible entry against
respondent with the Municipal Trial Court (MTC). They alleged that they had prior physical
possession of the Langcaan Property through their trustee, Ramon, until the latter was ousted by
respondent in September 1995. The MTC ruled in favor of petitioner spouses, which decision was
affirmed by the Regional Trial Court.18 However, the Court of Appeals set aside the decisions of the
lower courts and found that it was respondent who had prior physical possession of the property as
shown by his payment of real estate taxes thereon.19
On May 29, 1996, respondent filed the instant case for removal of cloud from title with damages to
cancel Entry No. 2676-75 and Entry No. 2677-75, the annotated Decision in Civil Case No. 741-93
and its Certificate of Finality, from the title of the Langcaan Property.20 Respondent alleged that the
deed of sale between him and his late first wife and Rebecca Del Rosario, who is not known to them,
could not have been possibly executed on February 27, 1992, the date appearing thereon. He
alleged that on said date, he was residing in the United States21 and his late first wife, Angelita Chan,
died twenty (20) years ago.221avvphi1
On May 28, 1997, during the pendency of the instant case before the trial court, respondent died
without having testified on the merits of his case. Hence, he was substituted by his surviving spouse,
Antonieta S. Pacleb, and Lorna Pacleb-Guerrero, Florencio C. Pacleb and Myrla C. Pacleb
representing the children with the first wife.23
On December 27, 2002, the trial court dismissed respondent’s case and held that petitioner spouses
are purchasers in good faith.24 The trial court ratiocinated that the dismissal of respondent’s
complaint for annulment of the successive sales at his instance "sealed the regularity of the
purchase"25 by petitioner spouses and that he "in effect admits that the said sale…was valid and in
order."26 Further, the trial court held that the Decision in Civil Case No. 741-93 on petitioner spouses’
action for specific performance against Javier is already final and can no longer be altered.
Accordingly, the trial court ordered the cancellation of TCT No. T-118375 in the name of respondent
and the issuance of a new title in the name of petitioner spouses. The trial court also ordered the
heirs of respondent and all persons claiming under them to surrender possession of the Langcaan
Property to petitioner spouses.
On appeal by respondent, the Court of Appeals reversed and set aside the decision of the trial
court.27 The Court of Appeals ruled that petitioner spouses are not purchasers in good faith and that
the Decision in Civil Case No. 741-93 did not transfer ownership of the Langcaan Property to them.
Accordingly, the appellate court ordered the cancellation of the annotation of the Decision in Civil
Case No. 741-93 on the title of the Langcaan Property. The Court of Appeals denied reconsideration
of said decision.28
Hence, this Petition.
Two issues are involved in the instant petition. The first is whether petitioner spouses are innocent
purchasers for value and in good faith. The second is whether ownership over the Langcaan
Property was properly vested in petitioner spouses by virtue of the Decision in Civil Case No. 741-
93.
Petitioner spouses argue that they are purchasers in good faith. Further, they contend that the Court
of Appeals erred in finding that: "Ramon told him [Ernesto V. Yu] that the property is owned by his
father, Baltazar, and that he is the mere caretaker thereof"29 since Ramon clarified that his father was
the former owner of the Langcaan Property. In support of their stance, they cite the following
testimony of petitioner Ernesto V. Yu:
Atty. Abalos: Mr. Witness, you testified during the direct that you acquired the subject property from
one Ruperto Javier, when for the first time have you come to know Mr. Ruperto Javier?
A: I first came to know him in the year 1992 when he was accompanied by Mr. Kalagayan.
He showed me some papers to the office.
Q: Do you know the exact date Mr. Witness?
A: I forgot the exact date, ma’am.
Q: More or less can you estimate what month?
A: Sometime in February or March 1992.
Q: When you said that the subject property was offered to you for sale, what did you do Mr.
Witness, in preparation for a transaction?
A: I asked my lawyer Atty. Florencio Paredes to check and verify the Deed of Sale.
Q: And after Atty. Florencio Paredes verified the document you decided to buy the property?
A: No, ma’am. We visited the place.

Q: When was that?
A: I could not remember the exact date but I visited the place and I met the son, Ramon
Pacleb. I went there in order to verify if the property is existing. When I verified that the
property is existing Mr. Javier visited me again to follow-up what decision I have but I told
him that I will wait for my lawyer’s advi[c]e.
Q: Mr. Witness, what particular instruction did you give to your lawyer?
A: To verify the title and the documents.
Court: Documents for the title?
A: Yes, Your Honor.
Atty. Abalos: When you were able to get the title in whose name the title was registered?
A: It was registered in the name of the older Pacleb.
Court: By the way Mr. Witness, when you said you met Ramon Pacleb the son of the owner
of the property, was he residing there or he was (sic) just went there? When you visited the
property did you find him to be residing in that property?
A: No, Your Honor.
Atty. Abalos: You mean to say Mr. Witness, you just met Mr. Ramon Pacleb in the place at
the time you went there?
A: No, ma’am. He went to my office with Mr. Kalagayan. He was introduced to me at the
Kelly Hardware. I do not know Mr. Ruperto Javier. He told me that there is a property that [is]
tenanted and occupied by the son Ramon Pacleb after that I went with them to visit the
place. On (sic) there he introduced me [to] Mr. Ramon Pacleb the caretaker of the property
and I told them that I will still look at the property and he gave me some documents and that
(sic) documents I gave it to my lawyer for verification.
Q: You said that Mr. Ruperto Javier went to your office with Mr. Kalagayan, so the first time
you visited the property you did not see Mr. Ramon Pacleb there?
A: No, ma’am. When I went there I met Ramon Pacleb the caretaker and he was the one
who showed the place to us.
Q: Mr. Witness, since you visited the place you were able to see the allege[d] caretaker Mr.
Ramon Pacleb, did you ask him regarding the property or the whereabouts of the registered
owner, did you ask him?
A: When Ruperto introduced me to Mr. Ramon Pacleb he told me that he is the son of the
owner and he is the caretaker and his father is in the States. He showed me the place, I
verified and I saw the monuments and I told him I will come back to check the papers and if it
is okay I will bring with me the surveyor.
Q: Could you estimate Mr. Witness, more or less what was the month when you were able to
talk to Mr. Ramon Pacleb?
A: I am not sure but it was morning of February.

Q: So it was in February, Mr. Witness?
A: I am not sure if February or March.
Q: But definitely…
A: Before I purchased the property I checked the property.
Q: But that was definitely after Mr. Ruperto offered to you for sale the subject property?
xxx
Atty. Abalos: Okay, Mr. Witness, you said that you talked to Mr. Ramon Pacleb and he told
you that his father is the owner of the property?
A: He told me that property is their former property and it was owned by them. Now, he is the
tenant of the property.30 (Emphasis ours)
Petitioner spouses conclude that based on their personal inspection of the property and the
representations of the registered tenant thereon, they had no reason to doubt the validity of the
deeds of absolute sale since these were duly notarized. Consequently, the alleged forgery of
Angelita Chan’s signature is of no moment since they had no notice of any claim or interest of some
other person in the property despite their diligent inquiry.
We find petitioner spouses’ contentions without merit.
At the outset, we note that in petitioner Ernesto V. Yu’s testimony, he stated that he inspected the
Langcaan Property and talked with the tenant, Ramon, before he purchased the same. However, in
his Complaint for specific performance and damages which he filed against Javier, he alleged that it
was only after he had entered into an Agreement for the sale of the property and his initial payment
of ₱200,000 that he discovered that the property was indeed being tenanted by Ramon who lives in
the said farm, viz.:
8. Sometime on September 11, 1992, defendant came again to the Office of plaintiff reiterating his
offer to sell said Lot No. 6853-D, containing an area of 18,000 square meters, at ₱75.00 per square
meters (sic). Defendant manifested to the plaintiff that if his offer is acceptable to the plaintiff, he
binds and obligates himself to pay the capital gains of previous transactions with the BIR and
register subject Lot No. 6853-D in his name (defendant). On these conditions, plaintiff accepted the
offer and made [the] initial payment of Two Hundred Thousand Pesos (₱200,000.00) to defendant
by issuance and delivery of plaintiff’s personal check.
9. Sometime on September 11, 1992, plaintiff and defendant signed an AGREEMENT on the sale of
Lot No. 6853-D of the subdivision plan (LRC) Psd-282604, containing an area of 18,000 square
meters, more or less, located at Bo. Langcaan, Municipality of Dasmarinas, Province of Cavite, at a
selling price of ₱75.00 per square meter. A xerox copy of this AGREEMENT signed by the parties
thereto is hereto attached and marked as ANNEX "D" of this complaint.
10. Thereafter, however, plaintiff and defendant, with their surveyor discovered that subject Lot No.
6853-D offered for sale to the plaintiff is indeed being tenanted by one RAMON PACLEB who lives
in the said farm.
11. In view of the foregoing developments, plaintiff informed defendant that he wanted the
Agreement be cancelled and for the defendant to return the sum of TWO HUNDRED THOUSAND
PESOS (₱200,000.00).31 (Emphasis supplied)
This inconsistency casts grave doubt as to whether petitioner spouses personally inspected the
property before purchasing it.
More importantly, however, several facts should have put petitioner spouses on inquiry as to the
alleged rights of their vendor, Javier, over the Langcaan Property.
First, it should be noted that the property remains to be registered in the name of respondent despite
the two (2) Deeds of Absolute Sale32 purporting to transfer the Langcaan Property from respondent
and his late first wife, Angelita Chan, to Rebecca Del Rosario then from the latter to Javier. Both
deeds were not even annotated in the title of the Langcaan Property.
Second, a perusal of the two deeds of absolute sale reveals that they were executed only about two
(2) months apart and that they contain identical provisions.
Third, it is undisputed that the Langcaan Property is in the possession of Ramon, the son of the
registered owner. Regardless of the representations given by the latter, this bare fact alone should
have made petitioner spouses suspicious as to the veracity of the alleged title of their vendor.
Moreover, as noted by the Court of Appeals, petitioner spouses could have easily verified the true
status of the Langcaan Property from Ramon’s wife, since the latter is their relative, as averred in
paragraph 13 of their Answer in Civil Case No. 1199-95.33 The case law is well settled, viz.:
The law protects to a greater degree a purchaser who buys from the registered owner himself.
Corollarily, it requires a higher degree of prudence from one who buys from a person who is not the
registered owner, although the land object of the transaction is registered. While one who buys from
the registered owner does not need to look behind the certificate of title, one who buys from one who
is not the registered owner is expected to examine not only the certificate of title but all factual
circumstances necessary for him to determine if there are any flaws in the title of the transferor, or in
his capacity to transfer the land.
This Court has consistently applied the stricter rule when it comes to deciding the issue of good faith
of one who buys from one who is not the registered owner, but who exhibits a certificate of
title.34 (Emphasis supplied)
Finally, as correctly pointed out by the Court of Appeals, the dismissal of Civil Case No. 1199-95 (the
action to annul the successive sales of the property) cannot serve to validate the sale to petitioner
spouses since the dismissal was ordered because Rebecca Del Rosario and Javier could no longer
be found. Indeed, the dismissal was without prejudice.
Based on the foregoing, therefore, petitioner spouses cannot be considered as innocent purchasers
in good faith.
We now go to the second issue.
Petitioner spouses argue that the decision of the Regional Trial Court in Civil Case No. 741-93 as to
the rightful owner of the Langcaan Property is conclusive and binding upon respondent even if the
latter was not a party thereto since it involved the question of possession and ownership of real
property, and is thus not merely an action in personam but an action quasi in rem.
In Domagas v. Jensen,35 we distinguished between actions in personam and actions quasi in rem.
The settled rule is that the aim and object of an action determine its character. Whether a
proceeding is in rem, or in personam, or quasi in rem for that matter, is determined by its nature and
purpose, and by these only. A proceeding in personam is a proceeding to enforce personal rights
and obligations brought against the person and is based on the jurisdiction of the person, although it
may involve his right to, or the exercise of ownership of, specific property, or seek to compel him to
control or dispose of it in accordance with the mandate of the court. The purpose of a proceeding in
personam is to impose, through the judgment of a court, some responsibility or liability directly upon
the person of the defendant. Of this character are suits to compel a defendant to specifically perform
some act or actions to fasten a pecuniary liability on him. An action in personam is said to be one
which has for its object a judgment against the person, as distinguished from a judgment against the
propriety (sic) to determine its state. It has been held that an action in personam is a proceeding to
enforce personal rights or obligations; such action is brought against the person.
xxx
On the other hand, a proceeding quasi in rem is one brought against persons seeking to subject the
property of such persons to the discharge of the claims assailed. In an action quasi in rem, an
individual is named as defendant and the purpose of the proceeding is to subject his interests
therein to the obligation or loan burdening the property. Actions quasi in rem deal with the status,
ownership or liability of a particular property but which are intended to operate on these questions
only as between the particular parties to the proceedings and not to ascertain or cut off the rights or
interests of all possible claimants. The judgments therein are binding only upon the parties who
joined in the action.
Civil Case No. 741-93 is an action for specific performance and damages filed by petitioner spouses
against Javier to compel performance of the latter’s undertakings under their Contract to Sell. As
correctly held by the Court of Appeals, its object is to compel Javier to accept the full payment of the
purchase price, and to execute a deed of absolute sale over the Langcaan Property in their favor.
The obligations of Javier under the contract to sell attach to him alone, and do not burden the
Langcaan Property.36
We have held in an unbroken string of cases that an action for specific performance is an action in
personam.37 In Cabutihan v. Landcenter Construction and Development Corporation,38 we ruled that
an action for specific performance praying for the execution of a deed of sale in connection with an
undertaking in a contract, such as the contract to sell, in this instance, is an action in personam.
Being a judgment in personam, Civil Case No. 741-93 is binding only upon the parties properly
impleaded therein and duly heard or given an opportunity to be heard.39 Therefore, it cannot bind
respondent since he was not a party therein. Neither can respondent be considered as privy thereto
since his signature and that of his late first wife, Angelita Chan, were forged in the deed of sale.
All told, we affirm the ruling of the Court of Appeals finding that, as between respondent and
petitioner spouses, respondent has a better right over the Langcaan Property as the true owner
thereof.
IN VIEW WHEREOF, the petition is DENIED. The decision of the Court of Appeals is affirmed. Costs
against petitioners.
SO ORDERED.
G.R. No. L-59731 January 11, 1990
ALFREDO CHING, petitioner,
vs.
THE HONORABLE COURT OF APPEALS & PEDRO ASEDILLO, respondents.
Joaquin E. Chipeco & Lorenzo D. Fuggan for petitioners.

Edgardo Salandanan for private respondent.
PARAS, J.:
This is a petition for review on certiorari which seeks to nullify the decision of respondent Court of
Appeals (penned by Hon. Rodolfo A. Nocon with the concurrence of Hon. Crisolito Pascual and Juan
A. Sison) in CA-G.R. No. 12358-SP entitled Alfredo Ching v. Hon. M. V. Romillo, et al. which in
effect affirmed the decision of the Court of First Instance of Rizal, now Regional Trial Court (penned
by Judge Manuel V. Romillo, Jr. then District Judge, Branch XXVII Pasay City) granting ex-parte the
cancellation of title registered in the name of Ching Leng in favor of Pedro Asedillo in Civil Case No.
6888-P entitled Pedro Asedillo v. Ching Leng and/or Estate of Ching Leng.
The facts as culled from the records disclose that:
In May 1960, Decree No. N-78716 was issued to spouses Maximo Nofuente and Dominga
Lumandan in Land Registration Case No. N-2579 of the Court of First Instance of Rizal and Original
Certificate of Title No. 2433 correspondingly given by the Register of Deeds for the Province of Rizal
covering a parcel of land situated at Sitio of Kay-Biga Barrio of San Dionisio, Municipality of
Paranaque, Province of Rizal, with an area of 51,852 square meters (Exhibit "7", p. 80, CA, Rollo).
In August 1960, 5/6 portion of the property was reconveyed by said spouses to Francisco, Regina,
Perfects, Constancio and Matilde all surnamed Nofuente and Transfer Certificate of Title No. 78633
was issued on August 10, 1960 accordingly (Exhibit "8", pp. 81 and 82, Ibid.).
By virtue of a sale to Ching Leng with postal address at No. 44 Libertad Street, Pasay City, Transfer
Certificate of Title No. 91137 was issued on September 18, 1961 and T.C.T. No. 78633 was deemed
cancelled. (Exhibit "5-2", pp. 76-77 and 83, Ibid.).
On October 19, 1965, Ching Leng died in Boston, Massachusetts, United States of America. His
legitimate son Alfredo Ching filed with the Court of First Instance of Rizal (now RTC) Branch III,
Pasay City a petition for administration of the estate of deceased Ching Leng docketed as Sp. Proc.
No. 1956-P. Notice of hearing on the petition was duly published in the "Daily Mirror", a newspaper
of general circulation on November 23 and 30 and December 7, 1965. No oppositors appeared at
the hearing on December 16, 1965, consequently after presentation of evidence petitioner Alfredo
Ching was appointed administrator of Ching Leng's estate on December 28, 1965 and letters of
administration issued on January 3, 1966 (pp. 51-53, Rollo). The land covered by T.C.T. No. 91137
was among those included in the inventory submitted to the court (p. 75, Ibid.).
Thirteen (13) years after Ching Leng's death, a suit against him was commenced on December 27,
1978 by private respondent Pedro Asedillo with the Court of First Instance of Rizal (now RTC),
Branch XXVII, Pasay City docketed as Civil Case No. 6888-P for reconveyance of the abovesaid
property and cancellation of T.C.T. No. 91137 in his favor based on possession (p. 33, Ibid.). Ching
Leng's last known address is No. 44 Libertad Street, Pasay City which appears on the face of T.C.T.
No. 91137 (not No. 441 Libertad Street, Pasay City, as alleged in private respondent's complaint).
(Order dated May 29, 1980, p. 55, Ibid.). An amended complaint was filed by private respondent
against Ching Leng and/or Estate of Ching Leng on January 30, 1979 alleging "That on account of
the fact that the defendant has been residing abroad up to the present, and it is not known
whether the defendant is still alive or dead, he or his estate may be served by summons and other
processes only by publication;" (p. 38, Ibid.). Summons by publication to Ching Leng and/or his
estate was directed by the trial court in its order dated February 7, 1979. The summons and the
complaint were published in the "Economic Monitor", a newspaper of general circulation in the
province of Rizal including Pasay City on March 5, 12 and 19, 1979. Despite the lapse of the sixty
(60) day period within which to answer defendant failed to file a responsive pleading and on motion
of counsel for the private respondent, the court a quo in its order dated May 25, 1979, allowed the
presentation of evidence ex-parte. A judgment by default was rendered on June 15, 1979, the
decretal portion of which reads:
WHEREFORE, finding plaintiffs causes of action in the complaint to be duly substantiated by
the evidence, judgment is hereby rendered in favor of the plaintiff and against the defendant
declaring the former (Pedro Asedillo) to be the true and absolute owner of the property
covered by T.C.T. No. 91137; ordering the defendant to reconvey the said property in favor
of the plaintiff; sentencing the defendant Ching Leng and/or the administrator of his estate to
surrender to the Register of Deeds of the Province of Rizal the owner's copy of T.C.T. No.
91137 so that the same may be cancelled failing in which the said T.C.T. No. 91137 is
hereby cancelled and the Register of Deeds of the Province of Rizal is hereby ordered to
issue, in lieu thereof, a new transfer certificate of title over the said property in the name of
the plaintiff Pedro Asedillo of legal age, and a resident of Estrella Street, Makati, Metro
Manila, upon payment of the fees that may be required therefor, including the realty taxes
due the Government.
IT IS SO ORDERED. (pp. 42-44, Ibid.)
Said decision was likewise served by publication on July 2, 9 and 16, 1979 pursuant to Section 7 of
Rule 13 of the Revised Rules of Court (CA Decision, pp. 83-84, Ibid.). The title over the property in
the name of Ching Leng was cancelled and a new Transfer Certificate of Title was issued in favor of
Pedro Asedillo (p. 77, CA Rollo) who subsequently sold the property to Villa Esperanza
Development, Inc. on September 3, 1979 (pp. 125-126, Ibid.).
On October 29, 1979 petitioner Alfredo Ching learned of the abovestated decision. He filed a verified
petition on November 10, 1979 to set it aside as null and void for lack of jurisdiction which was
granted by the court on May 29, 1980 (penned by Hon. Florentino de la Pena, Vacation Judge, pp.
54-59, Rollo).
On motion of counsel for private respondent the said order of May 29, 1980 was reconsidered and
set aside, the decision dated June 15, 1979 aforequoted reinstated in the order dated September 2,
1980. (pp. 60-63, Ibid.)
On October 30, 1980, petitioner filed a motion for reconsideration of the said latter order but the
same was denied by the trial court on April 12, 1981 (pp. 77-79, Ibid.)
Petitioner filed an original petition for certiorari with the Court of Appeals but the same was
dismissed on September 30, 1981. His motion for reconsideration was likewise denied on February
10, 1982 (pp. 81-90, Ibid.)
Private respondent Pedro Asedillo died on June 7, 1981 at Makati, Metro Manila during the
pendency of the case with the Court of Appeals (p. 106, CA Rollo).
Hence, the instant petition.
Private respondent's comment was filed on June 1, 1982 (p. 117, Ibid.) in compliance with the
resolution dated April 26, 1982 (p. 109, Ibid.) Petitioner filed a reply to comment on June 18, 1982
(p. 159, Ibid ), and the Court gave due course to the petition in the resolution of June 28, 1982 (p.
191, Ibid.)
Petitioner raised the following:
ASSIGNMENTS OF ERROR
WHETHER OR NOT A DEAD MAN CHING LENG AND/OR HIS ESTATE MAY BE VALIDLY
SERVED WITH SUMMONS AND DECISION BY PUBLICATION.
II
WHETHER OR NOT AN ACTION FOR RECONVEYANCE OF PROPERTY AND

CANCELLATION OF TITLE IS IN PERSONAM, AND IF SO, WOULD A DEAD MAN
AND/OR HIS ESTATE BE BOUND BY SERVICE OF SUMMONS AND DECISION BY
PUBLICATION.
III
WHETHER OR NOT THE PROCEEDINGS FOR RECONVEYANCE AND CANCELLATION

OF TITLE CAN BE HELD EX-PARTE.
IV
WHETHER OR NOT THE TRIAL COURT ACQUIRED JURISDICTION OVER THE

SUBJECT MATTER AND THE PARTIES.
WHETHER OR NOT PRIVATE RESPONDENT IS GUILTY OF LACHES IN INSTITUTING

THE ACTION FOR RECONVEYANCE AFTER THE LAPSE OF 19 YEARS FROM THE
TIME THE DECREE OF REGISTRATION WAS ISSUED.
Petitioner's appeal hinges on whether or not the Court of Appeals has decided a question of
substance in a way probably not in accord with law or with the applicable decisions of the Supreme
Court.
Petitioner avers that an action for reconveyance and cancellation of title is in personam and the
court a quo never acquired jurisdiction over the deceased Ching Leng and/or his estate by means of
service of summons by publication in accordance with the ruling laid down in Ang Lam v. Rosillosa
et al., 86 Phil. 448 [1950].
On the other hand, private respondent argues that an action for cancellation of title is quasi in rem,
for while the judgment that may be rendered therein is not strictly a judgment in in rem, it fixes and
settles the title to the property in controversy and to that extent partakes of the nature of the
judgment in rem, hence, service of summons by publication may be allowed unto Ching Leng who
on the face of the complaint was a non-resident of the Philippines in line with the doctrine enunciated
in Perkins v. Dizon, 69 Phil. 186 [1939].
The petition is impressed with merit.
An action to redeem, or to recover title to or possession of, real property is not an action in rem or an
action against the whole world, like a land registration proceeding or the probate of a will; it is an
action in personam, so much so that a judgment therein is binding only upon the parties properly
impleaded and duly heard or given an opportunity to be heard. Actions in personam and actions in
rem differ in that the former are directed against specific persons and seek personal judgments,
while the latter are directed against the thing or property or status of a person and seek judgments
with respect thereto as against the whole world. An action to recover a parcel of land is a real action
but it is an action in personam, for it binds a particular individual only although it concerns the right
to a tangible thing (Ang Lam v. Rosillosa, supra).
Private respondent's action for reconveyance and cancellation of title being in personam, the
judgment in question is null and void for lack of jurisdiction over the person of the deceased
defendant Ching Leng. Verily, the action was commenced thirteen (13) years after the latter's death.
As ruled by this Court in Dumlao v. Quality Plastic Products, Inc. (70 SCRA 475 [1976]) the decision
of the lower court insofar as the deceased is concerned, is void for lack of jurisdiction over his
person. He was not, and he could not have been validly served with summons. He had no more civil
personality. His juridical personality, that is fitness to be subject of legal relations, was lost through
death (Arts. 37 and 42 Civil Code).
The same conclusion would still inevitably be reached notwithstanding joinder of Ching Leng's estate
as co-defendant. it is a well-settled rule that an estate can sue or be sued through an executor or
administrator in his representative capacity (21 Am. Jr. 872). Contrary to private respondent's claims,
deceased Ching Leng is a resident of 44 Libertad Street, Pasay City as shown in his death certificate
and T. C. T. No. 91137 and there is an on-going intestate proceedings in the same court, Branch III
commenced in 1965, and notice of hearing thereof duly published in the same year. Such misleading
and misstatement of facts demonstrate lack of candor on the part of private respondent and his
counsel, which is censurable.
The complaint for cancellation of Ching Leng's Torrens Title must be filed in the original land
registration case, RTC, Pasig, Rizal, sitting as a land registration court in accordance with Section
112 of the Land Registration Act (Act No. 496, as amended) not in CFI Pasay City in connection
with, or as a mere incident in Civil Case No. 6888-P (Estanislao v. Honrado, 114 SCRA 748 [1982]).
Section 112 of the same law requires "notice to all parties in interest." Since Ching Leng was already
in the other world when the summons was published he could not have been notified at all and the
trial court never acquired jurisdiction over his person. The ex-parte proceedings for cancellation of
title could not have been held (Estanislao v. Honrado, supra).
The cited case of Perkins v. Dizon, supra is inapplicable to the case at bar since petitioner Perkins
was a non-resident defendant sued in Philippine courts and sought to be excluded from whatever
interest she has in 52,874 shares of stocks with Benguet Consolidated Mining Company. The action
being a quasi in rem summons by publication satisfied the constitutional requirement of due process.
The petition to set aside the judgment for lack of jurisdiction should have been granted and the
amended complaint of private respondent based on possession and filed only in 1978 dismissed
outrightly. Ching Leng is an innocent purchaser for value as shown by the evidence adduced in his
behalf by petitioner herein, tracing back the roots of his title since 1960, from the time the decree of
registration was issued.
The sole remedy of the landowner whose property has been wrongfully or erroneously registered in
another's name—after one year from the date of the decree—is not to set aside the decree, but
respecting the decree as incontrovertible and no longer open to review, to bring an ordinary action in
the ordinary court of justice for damages if the property has passed unto the hands of an innocent
purchaser for value (Sy, Sr. v. Intermediate Appellate Court, G.R. No. 66742; Teoville Development
Corporation v. IAC, et al., G.R. No. 75011, June 16, 1988).
Failure to take steps to assert any rights over a disputed land for 19 years from the date of
registration of title is fatal to the private respondent's cause of action on the ground of laches.
Laches is the failure or neglect, for an unreasonable length of time to do that which by exercising
due diligence could or should have been done, earlier; it is negligence or omission to assert a right
within a reasonable time warranting a presumption that the party entitled to assert it either has
abandoned it or declined to assert it (Bailon-Casilao v. Court of Appeals, G.R. No. 78178, April 15,
1988; Villamor v. Court of Appeals, G.R. No. 41508, June 27, 1988).
The real purpose of the Torrens system is to quiet title to land and to stop forever any question as to
its legality. Once a title is registered, the owner may rest secure, without the necessity of waiting in
the portals of the court, or sitting on the "mirador su casa," to avoid the possibility of losing his land
(National Grains Authority v. IAC, 157 SCRA 388 [1988]).
A Torrens title is generally a conclusive evidence of the ownership of the land referred to therein
(Section 49, Act 496). A strong presumption exists that Torrens titles are regularly issued and that
they are valid. A Torrens title is incontrovertible against any "information possessoria" or title existing
prior to the issuance thereof not annotated on the title (Salamat Vda. de Medina v. Cruz, G.R. No.
39272, May 4, 1988).
PREMISES CONSIDERED, (1) the instant petition is hereby GRANTED; (2) the appealed decision
of the Court of Appeals is hereby REVERSED and SET ASIDE; (3) the trial court's decision dated
June 15, 1979 and the Order dated September 2, 1980 reinstating the same are hereby declared
NULL and VOID for lack of jurisdiction and (4) the complaint in Civil Case No. 6888-P is hereby
DISMISSED.
SO ORDERED.
G.R. No. 150656 April 29, 2003
MARGARITA ROMUALDEZ-LICAROS, petitioner,
vs.
ABELARDO B. LICAROS, respondent.
CARPIO, J.:
The Case
This is a petition for review on certiorari1 to annul the Decision2 dated 9 August 2001 of the Court of
Appeals in CA-G.R. SP No. 58487, as well as the Resolution dated 23 October 2001 denying the
motion for reconsideration. The Court of Appeals dismissed the petition to annul the following
decisions3 rendered by Branch 143 of the Regional Trial Court of Makati:
(1) The Decision dated 27 December 19904 granting the dissolution of the conjugal
partnership of gains of the spouses Abelardo B. Licaros and Margarita Romualdez-Licaros;
(2) The Decision dated 8 November 19915 declaring the marriage between the same
spouses null and void.
The Facts
The antecedent facts as found by the Court of Appeals are as follows:
x x x Abelardo Licaros (Abelardo, for short) and Margarita Romualdez-Licaros (Margarita,

hereafter) were lawfully married on December 15, 1968. Out of this marital union were born
Maria Concepcion and Abelardo, Jr. Ironically, marital differences, squabbles and
irreconcilable conflicts transpired between the spouses, such that sometime in 1979, they
agreed to separate from bed and board.
In 1982, Margarita left for the United States and there, to settle down with her two (2)
children. In the United States, on April 26, 1989, Margarita applied for divorce before the
Superior Court of California, County of San Mateo (Annex "1", Rejoinder, pp. 164-165)
where she manifested that she does not desire counseling at that time (Quotation, p. 166,
Rollo). On August 6, 1990, Margarita was granted the decree of divorce (Annex 2, Answer,
p. 108, Rollo) together with a distribution of properties between her and Abelardo (pp. 167-
168, Rollo).
Not long after, on August 17, 1990, Abelardo and Margarita executed an "Agreement of
Separation of Properties" (pp. 60-64, Rollo). This was followed-up by a petition filed on
August 21, 1990 before the Regional Trial Court of Makati for the dissolution of the conjugal
partnership of gains of the spouses and for the approval of the agreement of separation of
their properties. This was docketed as Special Proceeding No. 2551. On December 27,
1990, a decision was issued granting the petition and approving the separation of property
agreement.
For his part, on June 24, 1991, Abelardo commenced Civil Case No. 91-1757, for the
declaration of nullity of his marriage with Margarita, based on psychological incapacity under
the New Family Code. As Margarita was then residing at 96 Mulberry Lane, Atherton,
California, U.S.A., Abelardo initially moved that summons be served through the International
Express Courier Service. The court a quo denied the motion. Instead, it ordered that
summons be served by publication in a newspaper of general circulation once a week for
three (3) consecutive weeks, at the same time furnishing respondent a copy of the order, as
well as the corresponding summons and a copy of the petition at the given address in the
United States through the Department of Foreign Affairs, all at the expense of Abelardo.
Respondent was given sixty (60) days after publication to file a responsive pleading.
On July 15, 1991, Process Server, Maximo B. Dela Rosa, submitted his Officer’s Return
quoted hereunder:
"OFFICER’S RETURN
THIS IS TO CERTIFY that on July 3, 1991, I have served a copy of summons and complaint
with annexes together with order dated June 28, 1991 issued by the Court in the above-
entitled case upon defendant Margarita Romualdez-Licaros c/o DFA. (sent by Mail) thru Pat
G. Martines receiving Clerk of Department of Foreign Affairs a person authorized to receive
this kind of process who acknowledged the receipt thereof at ADB Bldg., Roxas Blvd., Pasay
City, Metro Manila." (p. 40, Rollo)
As required by law, the case was referred to Trial Prosecutor Bruselas, Jr. to find out any possible
collusion between the parties in the case. Thereafter, with the negative report of collusion, Abelardo
was allowed to present his evidence ex-parte. On November 8, 1991, the Decision (Annex "A",
Petition) was handed down in Civil Case No. 91-1757 declaring the marriage between Abelardo and
Margarita null and void.
Almost nine (9) years later, on April 28, 2000, the petition at bench was commenced when Margarita
received a letter dated November 18, 1991 from a certain Atty. Angelo Q. Valencia informing her that
she no longer has the right to use the family name "Licaros" inasmuch as her marriage to Abelardo
had already been judicially dissolved by the Regional Trial Court of Makati on November 8, 1991.
Asseverating to have immediately made some verifications and finding the information given to be
true, petitioner commenced the instant petition on the following grounds:
(A) THERE WAS EXTRINSIC FRAUD IN THE PREPARATION AND FILING BY ABELARDO
OF THE PETITION FOR DISSOLUTION OF THE CONJUGAL PARTNERSHIP OF GAINS
AND ITS ANNEX, THE AGREEMENT OF SEPARATION OF PROPERTIES.
(B) THE TRIAL COURT LACKED JURISDICTION TO HEAR AND DECIDE THE PETITION
FOR DECLARATION OF NULLITY OF MARRIAGE.6
The Court of Appeals debunked the claim of Margarita that there was extrinsic fraud in the
preparation and filing by Abelardo of the Petition for Dissolution of Conjugal Partnership of
Gains and its annex, the Agreement of Separation of Properties. The Court of Appeals stated:
x x x, the extrinsic fraud alluded to consists of Abelardo coercing Margarita into signing the
petition to dissolve their conjugal partnership of gains together with the agreement of
separation of properties, by threatening to cut-off all financial and material support of their
children then still studying in the United States; that petitioner had no hand directly or
indirectly in the preparation of the petition and agreement of separation of properties; that
petitioner never met the counsel for the petitioner, nor the notary public who notarized the
deed; and, petitioner never received any notice of the pendency of the petition nor a copy of
the decision.
Antithetically, a meticulous perusal of the controversial petition (Annex "B-1") and the
agreement of separation of properties (pp. 60-64, Rollo) readily shows that the same were
signed by the petitioner on the proper space after the prayer and on the portion for the
verification of the petition. The same is true with the agreement of separation of properties.
What is striking to note is that on August 6, 1990, Margarita appeared before Amado P.
Cortez, Consul of the Republic of the Philippines at the San Francisco, California, United
States Consulate Office, to affirm and acknowledge before said official that she executed the
agreement of separation of properties of her own free will and deed, after being informed of
the contents thereof. And yet, there is no showing that Abelardo was with her at the
Philippine Consulate Office in confirming the separation of property agreement. Moreover,
on page 2 of the same agreement, it is specifically stated that such property separation
document shall be "subject to approval later on by the proper court of competent jurisdiction."
The clear import of this is that the agreement must have to be submitted before the proper
court for approval, which explains and confirms petitioner’s signature on the petition filed in
court.
In main, We see no indication nor showing of coercion or fraud from these facts, which could
very well be considered as extrinsic or collateral fraud to justify a petition under Rule 47.
From all indications, the pretended coerced documents were rather freely and voluntarily
executed by the parties therein knowing fully well the imports thereof. This conclusion finds
more weight if We consider the fact that the separation of property was fully implemented
and enforced, when apparently both parties correspondingly received the properties
respectively assigned to each of them under the said document.7
The Court of Appeals also rejected Margarita’s claim that the trial court lacked jurisdiction to hear
and decide the Petition for Declaration of Nullity of Marriage for improper service of summons on
her. The case involves the marital status of the parties, which is an action in rem or quasi in rem.
The Court of Appeals ruled that in such an action the purpose of service of summons is not to vest
the trial court with jurisdiction over the person of the defendant, but "only" to comply with due
process. The Court of Appeals concluded that any irregularity in the service of summons involves
due process which does not destroy the trial court’s jurisdiction over the res which is the parties’
marital status. Neither does such irregularity invalidate the judgment rendered in the case. Thus, the
Court of Appeals dismissed the petition for annulment of judgment, stating that:
At bar, the case involves the personal (marital) status of the plaintiff and the defendant. This
status is the res over which the Philippine court has acquired jurisdiction. This is also the
kind of action which the Supreme Court had ruled that service of summons may be served
extraterritorially under Section 15 (formerly Section 17) of Rule 14 and where such service
of summons is not for the purpose of vesting the trial court with jurisdiction over the person of
the defendant but only for the purpose of complying with the requirements of fair play and
due process. A fortiori, the court a quo had properly acquired jurisdiction over the person of
herein petitioner-defendant when summons was served by publication and a copy of the
summons, the complaint with annexes, together with the Order of June 28, 1991, was served
to the defendant through the Department of Foreign Affairs by registered mail and duly
received by said office to top it all. Such mode was upon instruction and lawful order of the
court and could even be treated as ‘any other manner the court may deem sufficient’.8
Hence, the instant petition.
The Issues
The issues raised by Margarita are restated as follows:
I. Whether Margarita was validly served with summons in the case for declaration of nullity of
her marriage with Abelardo;
II. Whether there was extrinsic fraud in the preparation and filing by Abelardo of the Petition
for Dissolution of the Conjugal Partnership of Gains and its annex, the Agreement of
Separation of Properties.
The Court’s Ruling
The petition is bereft of merit.
First Issue: Validity of the Service of Summons on Margarita
Margarita insists that the trial court never acquired jurisdiction over her person in the petition for
declaration of nullity of marriage since she was never validly served with summons. Neither did she
appear in court to submit voluntarily to its jurisdiction.
On the other hand, Abelardo argues that jurisdiction over the person of a non-resident defendant in
an action in rem or quasi in rem is not necessary. The trial and appellate courts made a clear factual
finding that there was proper summons by publication effected through the Department of Foreign
Affairs as directed by the trial court. Thus, the trial court acquired jurisdiction to render the decision
declaring the marriage a nullity.
Summons is a writ by which the defendant is notified of the action brought against him. Service of
such writ is the means by which the court acquires jurisdiction over his person.9
As a rule, when the defendant does not reside and is not found in the Philippines, Philippine courts
cannot try any case against him because of the impossibility of acquiring jurisdiction over his person
unless he voluntarily appears in court. But when the case is one of actions in rem or quasi in
rem enumerated in Section 15,10 Rule 14 of the Rules of Court, Philippine courts have jurisdiction to
hear and decide the case. In such instances, Philippine courts have jurisdiction over the res, and
jurisdiction over the person of the non-resident defendant is not essential.11
Actions in personam12 and actions in rem or quasi in rem differ in that actions in personam are

directed against specific persons and seek personal judgments. On the other hand, actions in
rem or quasi in rem are directed against the thing or property or status of a person and seek
judgments with respect thereto as against the whole world.13
At the time Abelardo filed the petition for nullity of the marriage in 1991, Margarita was residing in the
United States. She left the Philippines in 1982 together with her two children. The trial court
considered Margarita a non-resident defendant who is not found in the Philippines. Since the petition
affects the personal status of the plaintiff, the trial court authorized extraterritorial service of
summons under Section 15, Rule 14 of the Rules of Court. The term "personal status" includes
family relations, particularly the relations between husband and wife.14
Under Section 15 of Rule 14, a defendant who is a non-resident and is not found in the country may
be served with summons by extraterritorial service in four instances: (1) when the action affects
the personal status of the plaintiff; (2) when the action relates to, or the subject of which is
property within the Philippines, in which the defendant has or claims a lien or interest, actual or
contingent; (3) when the relief demanded consists, wholly or in part, in excluding the defendant from
any interest in property located in the Philippines; or (4) when the property of the defendant has
been attached within the Philippines.
In these instances, extraterritorial service of summons may be effected under any of three modes:
(1) by personal service out of the country, with leave of court; (2) by publication and sending a copy
of the summons and order of the court by registered mail to the defendant’s last known address,
also with leave of court; or (3) by any other means the judge may consider sufficient.
Applying the foregoing rule, the trial court required extraterritorial service of summons to be effected
on Margarita in the following manner:
x x x, service of Summons by way of publication in a newspaper of general circulation once a

week for three (3) consecutive weeks, at the same time, furnishing respondent copy of this
Order as well as the corresponding Summons and copy of the petition at her given address
at No. 96 Mulberry Lane, Atherton, California, U.S.A., thru the Department of Foreign
Affairs, all at the expense of petitioner.15 (Emphasis ours)
The trial court’s prescribed mode of extraterritorial service does not fall under the first or second
mode specified in Section 15 of Rule 14, but under the third mode. This refers to "any other means
that the judge may consider sufficient."
The Process Server’s Return of 15 July 1991 shows that the summons addressed to Margarita
together with the complaint and its annexes were sent by mail to the Department of Foreign Affairs
with acknowledgment of receipt. The Process Server’s certificate of service of summons is prima
facie evidence of the facts as set out in the certificate.16 Before proceeding to declare the marriage
between Margarita and Abelardo null and void, the trial court stated in its Decision dated 8
November 1991 that "compliance with the jurisdictional requirements hav(e) (sic) been duly
established." We hold that delivery to the Department of Foreign Affairs was sufficient compliance
with the rule. After all, this is exactly what the trial court required and considered as sufficient to
effect service of summons under the third mode of extraterritorial service pursuant to Section 15 of
Rule 14.
Second Issue: Validity of the Judgment Dissolving the Conjugal Partnership of Gains
Margarita claims that Abelardo coerced her into signing the Petition for Dissolution of the Conjugal
Partnership of Gains ("Petition") and its annex, the Agreement of Separation of
Properties ("Agreement"). Abelardo allegedly threatened to cut off all financial and material support
to their children if Margarita did not sign the documents.
The trial court did not find anything amiss in the Petition and Agreement that Abelardo filed, and thus
the trial court approved the same. The Court of Appeals noted that a meticulous perusal of the
Petition and Agreement readily shows that Margarita signed the same on the proper space after the
prayer and on the portion for the verification of the petition. The Court of Appeals observed further
that on 6 August 1990, Margarita appeared before Consul Amado Cortez in the Philippine Consulate
Office in San Francisco, California, to affirm that she executed the Agreement of her own free will.
There was no showing that Abelardo was at that time with her at the Philippine Consulate Office.
Abelardo secured judicial approval of the Agreement as specifically required in the Agreement.
The Court is bound by the factual findings of the trial and appellate courts that the parties freely and
voluntarily executed the documents and that there is no showing of coercion or fraud. As a rule, in
an appeal by certiorari under Rule 45, the Court does not pass upon questions of fact as the factual
findings of the trial and appellate courts are binding on the Court. The Court is not a trier of facts.
The Court will not examine the evidence introduced by the parties below to determine if the trial and
appellate courts correctly assessed and evaluated the evidence on record.17
The due and regular execution of an instrument acknowledged before an officer authorized to
administer oaths cannot be overthrown by bare allegations of coercion but only by clear and
convincing proof.18 A person acknowledging an instrument before an officer authorized to administer
oaths acknowledges that he freely and voluntarily executed the instrument, giving rise to a prima
facie presumption of such fact.
In the instant case, Margarita acknowledged the Agreement before Consul Cortez. The certificate of
acknowledgment signed by Consul Cortez states that Margarita personally appeared before him and
"acknowledged before me that SHE executed the same of her own free will and deed."19 Thus,
there is a prima facie presumption that Margarita freely and voluntarily executed the Agreement.
Margarita has failed to rebut this prima facie presumption with clear and convincing proof of coercion
on the part of Abelardo.
A document acknowledged before a notary public is prima facie evidence of the due and regular
execution of the document.20 A notarized document has in its favor the presumption of regularity in
its execution, and to contradict the same, there must be evidence that is clear, convincing and more
than merely preponderant.21
WHEREFORE, the Decision of the Court of Appeals in CA-G.R. SP No. 58487 dismissing the
petition to annul judgment is AFFIRMED.
SO ORDERED.
G.R. No. 127692 March 10, 2004
FORTUNATO GOMEZ and AURORA GOMEZ, petitioners,

vs.
COURT OF APPEALS, ADOLFO TROCINO and MARIANO TROCINO, respondents.
DECISION
AUSTRIA-MARTINEZ, J.:
Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court assailing
the decision1 of the Court of Appeals dated September 30, 1996, in CA-G.R. SP No. 40067,
nullifying the decision and orders of the Regional Trial Court of Cebu City (Branch 10) in Civil Case
No. CEB-11103, for want of jurisdiction.
Civil Case No. CEB-11103 is an action for specific performance and/or rescission filed by herein
petitioners, spouses Fortunato and Aurora Gomez, against the heirs of Jesus J. Trocino, Sr., which
include herein respondents and their mother Caridad Trocino.2
Filed on December 16, 1991, the complaint alleges: Some time in 1975, the spouses Jesus and
Caridad Trocino mortgaged two parcels of land covered by TCT Nos. 10616 and 31856 to Dr.
Clarence Yujuico. The mortgage was subsequently foreclosed and the properties sold at public
auction on July 11, 1988, and before the expiry of the redemption period, the spouses Trocino sold
the property to petitioners on December 12, 1989, who in turn, redeemed the same from Dr. Yujuico.
The spouses Trocino, however, refused to convey ownership of the properties to petitioners, hence,
the complaint.
On January 10, 1992, the trial court’s Process Server served summons on respondents, in the
manner described in his "Return of Service," to wit:
Respectfully returned to the Branch Clerk of Court, Regional Trial Court of Cebu, Branch 10, the
herein attached original summons issued in the above-entitled case with the information that on
January 8, 1992 summons and copies of the complaint were served to the defendants Jacob, Jesus
Jr., Adolfo, Mariano, Consolacion, Alice, Racheal thru defendant Caridad Trocino at their given
address at Maria Cristina Extension (besides Sacred Heart School for Girls), Cebu City, evidence by
her signature found at the lower portion of the original summons.3
WHEREFORE I, respectfully return the original summons duly served to the court of origin.
Cebu City, Philippines, January 10, 1992.
(signed)
DELFIN D. BARNIDO
RTC Process Server
On January 27, 1992, the defendants, through their counsel Atty. Expedito P. Bugarin, filed their
Answer. Defendant Caridad A. Trocino, respondents’ mother, verified said pleading.4
After trial on the merits, the RTC rendered its decision on March 1993, with the following disposition:
WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiffs and
against the defendants.
The latter are hereby ordered to jointly and severally execute a Deed of Sale in favor of the plaintiffs
and to deliver the owner’s duplicate copies of TCT Nos. 10616 and 31856, covering the properties
sold, to the plaintiffs within ten (10) days from the finality of the judgment, after which plaintiffs shall
pay in turn to the defendants the balance of ₱2,000,000.00. Otherwise, the sale is rescinded and
revoked and the defendants are directed to return to the plaintiffs the amount of ₱500,000.00, with
interest of 12% per annum computed from December 6, 1989, until the full amount is paid.
In addition thereto, defendants are to pay jointly and severally to the plaintiffs, the amount of
₱50,000.00 as moral damages; ₱20,000.00 as exemplary damages; ₱40,000.00 by way of
attorney’s fees; and ₱10,000.00 as litigation expenses.
SO ORDERED.5
Due to the defendants’ failure to deliver the owner’s duplicate of TCT Nos. 10616 and 31856, the
RTC issued an order on August 29, 1995 declaring said titles null and void, and ordering the
Register of Deeds of Cebu City to issue new titles in the name of herein petitioners.6
Thereafter, or on March 13, 1996, respondents Adolfo and Mariano Trocino filed with the Court of
Appeals, a petition for the annulment of the judgment rendered by the RTC-Cebu (Branch 10) in Civil
Case No. CEB-11103. Private respondents alleged that the trial court’s decision is null and void on
the ground that it did not acquire jurisdiction over their persons as they were not validly served with a
copy of the summons and the complaint. According to them, at the time summons was served on
them, Adolfo Trocino was already in Ohio, U.S.A., and has been residing there for 25 years, while
Mariano Trocino was in Talibon, Bohol, and has been residing there since 1986. They also refuted
the receipt of the summons by Caridad A. Trocino, and the representation made by Atty. Bugarin in
their behalf. Respondents also contended that they have a meritorious defense.7 Petitioners filed
their Comment/Answer to the petition.8
On September 30, 1996, the Court of Appeals issued the assailed Decision granting the petition and
annulling the decision of the RTC-Cebu (Branch 10). The decretal portion of the decision reads:
WHEREFORE, the decision of the Regional Trial Court of Cebu City, Branch 10, in Civil Case No.
CEB-11103 as well as all Orders issued to implement the same are hereby ANNULLED AND SET
ASIDE. The Register of Deeds of Cebu City is hereby ENJOINED from cancelling Transfer
Certificates of Title Nos. 10616 and 31856. No pronouncement as to costs.
SO ORDERED.9
Their motion for reconsideration having been denied by the Court of Appeals, petitioners filed the
present petition, setting forth the following assignment of errors:
I. THE COURT OF APPEALS ERRED IN FINDING LACK OF PRIOR KNOWLEDGE ON THE PART
OF RESPONDENTS TROCINO, REGARDING THE PROCEEDINGS BEFORE THE RTC OF CEBU
CITY AND IN NOT DISMISSING THE PETITION FOR VIOLATION OF SUPREME COURT
CIRCULAR 04-94.
II. THE COURT OF APPEALS ERRED IN DECLARING THE NEED FOR PERSONAL AND/OR
EXTRATERRITORIAL SERVICE OF SUMMONS, DESPITE THE NATURE OF THE CAUSE OF
ACTION BEING ONE IN REM.
III. THE COURT OF APPEALS ERRED IN ANNULLING THE JUDGMENT, CAUSING FURTHER
USELESS LITIGATION AND UNNECESSARY EXPENSE ON PETITIONERS AND
RESPONDENTS, ESPECIALLY SINCE RESPONDENTS HAVE NOT SHOWN ANY VALID
DEFENSE AS GROUND FOR REVERSAL OF JUDGMENT OF THE RTC.
IV. THE COURT OF APPEALS ERRED IN RULING THAT ITS JUDGMENT IS APPLICABLE IN
FAVOR OF CARIDAD TROCINO.10
Summons is a writ by which the defendant is notified of the action brought against him. Service of
such writ is the means by which the court acquires jurisdiction over his person.11 Any judgment
without such service in the absence of a valid waiver is null and void.12
The resolution of the present petition hinges on the issue of whether or not summons was effectively
served on respondents. If in the affirmative, the trial court had validly acquired jurisdiction over their
persons and therefore its judgment is valid.
To resolve whether there was valid service of summons on respondents, the nature of the action
filed against them must first be determined. As the Court explained in Asiavest Limited vs. Court of
Appeals, it will be helpful to determine first whether the action is in personam, in rem, or quasi in rem
because the rules on service of summons under Rule 14 of the Rules of Court of the Philippines
apply according to the nature of the action.13
In actions in personam, summons on the defendant must be served by handing a copy thereof to the
defendant in person, or, if he refuses to receive it, by tendering it to him. This is specifically provided
in Section 7, Rule 14 of the Rules of Court,14 which states:
SEC. 7. Personal service of summons.-- The summons shall be served by handing a copy thereof to
the defendant in person or, if he refuses to receive it, by tendering it to him.
If efforts to find defendant personally makes prompt service impossible, substituted service may be
effected by leaving copies of the summons at the defendant's dwelling house or residence with some
person of suitable age and discretion then residing therein, or by leaving the copies at the
defendant's office or regular place of business with some competent person in charge thereof.15 In
substituted service, it is mandated that the fact of impossibility of personal service should be
explained in the proof of service.16
When the defendant in an action in personam is a non-resident who does not voluntarily submit
himself to the authority of the court, personal service of summons within the State is essential to the
acquisition of jurisdiction over his person. This cannot be done if the defendant is not physically
present in the country, and thus, the court cannot acquire jurisdiction over his person and therefore
cannot validly try and decide the case against him.17 An exception was accorded in Gemperle vs.
Schenker wherein service of summons through the non-resident’s wife, who was a resident of the
Philippines, was held valid, as the latter was his representative and attorney-in-fact in a prior civil
case filed by the non-resident, and the second case was merely an offshoot of the first case.18
Meanwhile, in actions in rem or quasi in rem, jurisdiction over the person of the defendant is not a
prerequisite to confer jurisdiction on the court provided that the court acquires jurisdiction over the
res, although summons must be served upon the defendant in order to satisfy the due process
requirements.19 Thus, where the defendant is a non-resident who is not found in the Philippines, and
(1) the action affects the personal status of the plaintiff; (2) the action relates to, or the subject matter
of which is property in the Philippines in which the defendant has or claims a lien or interest; (3) the
action seeks the exclusion of the defendant from any interest in the property located in the
Philippines; or (4) the property of the defendant has been attached in the Philippines, summons may
be served extraterritorially by (a) personal service out of the country, with leave of court; (b)
publication, also with leave of court; or (c) any other manner the court may deem sufficient.20
In the present case, petitioners’ cause of action in Civil Case No. CEB-11103 is anchored on the
claim that the spouses Jesus and Caridad Trocino reneged on their obligation to convey ownership
of the two parcels of land subject of their sale. Thus, petitioners pray in their complaint that the
spouses Trocino be ordered to execute the appropriate deed of sale and that the titles be delivered
to them (petitioners); or in the alternative, that the sale be revoked and rescinded; and spouses
Trocino ordered to return to petitioners their down payment in the amount of P500,000.00 plus
interests. The action instituted by petitioners affect the parties alone, not the whole world. Hence, it
is an action in personam, i.e., any judgment therein is binding only upon the parties properly
impleaded.21
Contrary to petitioners’ belief, the complaint they filed for specific performance and/or rescission is
not an action in rem. While it is a real action because it affects title to or possession of the two
parcels of land covered by TCT Nos. 10616 and 31856, it does not automatically follow that the
action is already one in rem. In Hernandez vs. Rural Bank of Lucena, Inc., the Court made the
following distinction:
In a personal action, the plaintiff seeks the recovery of personal property, the enforcement of a
contract or the recovery of damages. In a real action, the plaintiff seeks the recovery of real property,
or, as indicated in section 2(a) of Rule 4, a real action is an action affecting title to real property or for
the recovery of possession, or for partition or condemnation of, or foreclosure of a mortgage on, real
property.
An action in personam is an action against a person on the basis of his personal liability, while an
action in rem is an action against the thing itself, instead of against the person. Hence, a real action
may at the same time be an action in personam and not necessarily an action in rem.22
The objective sought in petitioners’ complaint was to establish a claim against respondents for their
alleged refusal to convey to them the title to the two parcels of land that they inherited from their
father, Jesus Trocino, who was one of the sellers of the properties to petitioners. Hence, to repeat,
Civil Case No. CEB-11103 is an action in personam because it is an action against persons, namely,
herein respondents, on the basis of their personal liability. As such, personal service of summons
upon the defendants is essential in order for the court to acquire of jurisdiction over their
persons.23
A distinction, however, must be made with regard to service of summons on respondents Adolfo
Trocino and Mariano Trocino. Adolfo Trocino, as records show, is already a resident of Ohio, U.S.A.
for 25 years. Being a non-resident, the court cannot acquire jurisdiction over his person and validly
try and decide the case against him.
On the other hand, Mariano Trocino has been in Talibon, Bohol since 1986. To validly acquire
jurisdiction over his person, summons must be served on him personally, or through substituted
service, upon showing of impossibility of personal service. Such impossibility, and why efforts
exerted towards personal service failed, should be explained in the proof of service. The pertinent
facts and circumstances attendant to the service of summons must be stated in the proof of service
or Officer’s Return. Failure to do so would invalidate all subsequent proceedings on jurisdictional
grounds.24
In the present case, the process server served the summons and copies of the complaint on
respondents Jacob, Jesus, Jr., Adolfo, Mariano, Consolacion, Alice and Racheal,25 through their
mother, Caridad Trocino.26 The return did not contain any particulars as to the impossibility of
personal service on Mariano Trocino within a reasonable time. Such improper service renders the
same ineffective.
Due process of law requires personal service to support a personal judgment, and, when the
proceeding is strictly in personam brought to determine the personal rights and obligations of the
parties, personal service within the state or a voluntary appearance in the case is essential to the
acquisition of jurisdiction so as to constitute compliance with the constitutional requirement of due
process.27
Moreover, inasmuch as the sheriff’s return failed to state the facts and circumstances showing the
impossibility of personal service of summons upon respondents within a reasonable time, petitioners
should have sought the issuance of an alias summons. Under Section 5, Rule 14 of the Rules of
Court, alias summons may be issued when the original summons is returned without being served
on any or all of the defendants.28 Petitioners, however, did not do so, and they should now bear the
consequences of their lack of diligence.
The fact that Atty. Expedito Bugarin represented all the respondents without any exception does not
transform the ineffective service of summons into a valid one. It does not constitute a valid waiver or
even a voluntary submission to the trial court’s jurisdiction. There was not even the slightest proof
showing that respondents authorized Atty. Bugarin’s appearance for and in their behalf. As found by
the Court of Appeals:
While Caridad Trocino may have engaged the services of Atty. Bugarin, it did not necessarily mean
that Atty. Bugarin also had the authority to represent the defendant heirs. The records show that in
all the pleadings which required verification, only Caridad Trocino signed the same. There was never
a single instance where defendant heirs signed the pleading. The fact that a pleading is signed by
one defendant does not necessarily mean that it is binding on a co-defendant. Furthermore, Caridad
Trocino represented herself as the principal defendant in her Motion to Withdraw Appeal. (Rollo, p.
80)
Since the defendant heirs are co-defendants, the trial court should have verified the extent of Atty.
Bugarin’s authority when petitioners failed to appear as early as the pre-trial stage, where the parties
are required to appear. The absence of the defendant heirs should have prompted the trial court to
inquire from the lawyer whether he was also representing the other petitioners. As co-defendant and
co-heirs over the disputed properties, the defendant heirs had every right to be present during the
trial. Only Caridad Trocino appeared and testified on her own behalf. All the defenses raised were
her own, not the defendant heirs.29
Consequently, the judgment sought to be executed against respondents were rendered without
jurisdiction as there was neither a proper service of summons nor was there any waiver or voluntary
submission to the trial court’s jurisdiction. Hence, the same is void, with regard to private
respondents except Caridad Trocino.
It must be pointed out that while it was the spouses Jesus and Caridad Trocino who sold the
properties to petitioners, their right to proceed against Jesus Trocino when he died was passed on to
his heirs, which includes respondents and Caridad Trocino. Such transmission of right occurred by
operation of law, more particularly by succession, which is a mode of acquisition by virtue of which
the property, rights and obligations to the extent of the value of the inheritance of a person are
transmitted.30 When the process server personally served the summons on Caridad Trocino, the trial
court validly acquired jurisdiction over her person alone. Hence, the trial court’s decision is valid and
binding with regard to her, but only in proportion to Caridad Trocino’s share. As aptly stated by the
Court of Appeals:
This Court’s decision is therefore applicable to all the defendant heirs with the exception of
defendant Caridad Trocino considering that it was the latter who entered into the alleged sale
without the consent of her husband. She is therefore estopped from questioning her own authority to
enter into the questioned sale. Moreover, Caridad Trocino was validly served with summons and
was accorded due process.31
WHEREFORE, the petition for review is DENIED. The decision of the Court of Appeals in CA-G.R.
SP No. 40067 is AFFIRMED.
Costs against petitioners.
SO ORDERED.
G.R. No. 190710 June 6, 2011
JESSE U. LUCAS, Petitioner,
vs.
JESUS S. LUCAS, Respondent.
DECISION
NACHURA, J.:
Is a prima facie showing necessary before a court can issue a DNA testing order? In this petition for
review on certiorari, we address this question to guide the Bench and the Bar in dealing with a
relatively new evidentiary tool. Assailed in this petition are the Court of Appeals (CA) Decision1 dated
September 25, 2009 and Resolution dated December 17, 2009.
The antecedents of the case are, as follows:
On July 26, 2007, petitioner, Jesse U. Lucas, filed a Petition to Establish Illegitimate Filiation (with
Motion for the Submission of Parties to DNA Testing)2 before the Regional Trial Court (RTC), Branch
72, Valenzuela City. Petitioner narrated that, sometime in 1967, his mother, Elsie Uy (Elsie),
migrated to Manila from Davao and stayed with a certain "Ate Belen (Belen)" who worked in a
prominent nightspot in Manila. Elsie would oftentimes accompany Belen to work. On one occasion,
Elsie got acquainted with respondent, Jesus S. Lucas, at Belen’s workplace, and an intimate
relationship developed between the two. Elsie eventually got pregnant and, on March 11, 1969, she
gave birth to petitioner, Jesse U. Lucas. The name of petitioner’s father was not stated in petitioner’s
certificate of live birth. However, Elsie later on told petitioner that his father is respondent. On August
1, 1969, petitioner was baptized at San Isidro Parish, Taft Avenue, Pasay City. Respondent
allegedly extended financial support to Elsie and petitioner for a period of about two years. When the
relationship of Elsie and respondent ended, Elsie refused to accept respondent’s offer of support
and decided to raise petitioner on her own. While petitioner was growing up, Elsie made several
attempts to introduce petitioner to respondent, but all attempts were in vain.
Attached to the petition were the following: (a) petitioner’s certificate of live birth; (b) petitioner’s
baptismal certificate; (c) petitioner’s college diploma, showing that he graduated from Saint Louis
University in Baguio City with a degree in Psychology; (d) his Certificate of Graduation from the
same school; (e) Certificate of Recognition from the University of the Philippines, College of Music;
and (f) clippings of several articles from different newspapers about petitioner, as a musical prodigy.
Respondent was not served with a copy of the petition. Nonetheless, respondent learned of the
petition to establish filiation. His counsel therefore went to the trial court on August 29, 2007 and
obtained a copy of the petition.
Petitioner filed with the RTC a Very Urgent Motion to Try and Hear the Case. Hence, on September
3, 2007, the RTC, finding the petition to be sufficient in form and substance, issued the
Order3 setting the case for hearing and urging anyone who has any objection to the petition to file his
opposition. The court also directed that the Order be published once a week for three consecutive
weeks in any newspaper of general circulation in the Philippines, and that the Solicitor General be
furnished with copies of the Order and the petition in order that he may appear and represent the
State in the case.
On September 4, 2007, unaware of the issuance of the September 3, 2007 Order, respondent filed a
Special Appearance and Comment. He manifested inter alia that: (1) he did not receive the
summons and a copy of the petition; (2) the petition was adversarial in nature and therefore
summons should be served on him as respondent; (3) should the court agree that summons was
required, he was waiving service of summons and making a voluntary appearance; and (4) notice by
publication of the petition and the hearing was improper because of the confidentiality of the subject
matter.4
On September 14, 2007, respondent also filed a Manifestation and Comment on Petitioner’s Very
Urgent Motion to Try and Hear the Case. Respondent reiterated that the petition for recognition is
adversarial in nature; hence, he should be served with summons.
After learning of the September 3, 2007 Order, respondent filed a motion for
reconsideration.5 Respondent averred that the petition was not in due form and substance because
petitioner could not have personally known the matters that were alleged therein. He argued that
DNA testing cannot be had on the basis of a mere allegation pointing to respondent as petitioner’s
father. Moreover, jurisprudence is still unsettled on the acceptability of DNA evidence.
On July 30, 2008, the RTC, acting on respondent’s motion for reconsideration, issued an
Order6 dismissing the case. The court remarked that, based on the case of Herrera v. Alba,7 there
are four significant procedural aspects of a traditional paternity action which the parties have to face:
a prima facie case, affirmative defenses, presumption of legitimacy, and physical resemblance
between the putative father and the child. The court opined that petitioner must first establish these
four procedural aspects before he can present evidence of paternity and filiation, which may include
incriminating acts or scientific evidence like blood group test and DNA test results. The court
observed that the petition did not show that these procedural aspects were present. Petitioner failed
to establish a prima facie case considering that (a) his mother did not personally declare that she
had sexual relations with respondent, and petitioner’s statement as to what his mother told him
about his father was clearly hearsay; (b) the certificate of live birth was not signed by respondent;
and (c) although petitioner used the surname of respondent, there was no allegation that he was
treated as the child of respondent by the latter or his family. The court opined that, having failed to
establish a prima facie case, respondent had no obligation to present any affirmative defenses. The
dispositive portion of the said Order therefore reads:
WHEREFORE, for failure of the petitioner to establish compliance with the four procedural aspects
of a traditional paternity action in his petition, his motion for the submission of parties to DNA testing
to establish paternity and filiation is hereby denied. This case is DISMISSED without prejudice.
SO ORDERED.8
Petitioner seasonably filed a motion for reconsideration to the Order dated July 30, 2008, which the
RTC resolved in his favor. Thus, on October 20, 2008, it issued the Order9 setting aside the court’s
previous order, thus:
WHEREFORE, in view of the foregoing, the Order dated July 30, 2008 is hereby reconsidered and
set aside.
Let the Petition (with Motion for the Submission of Parties to DNA Testing) be set for hearing
on January 22, 2009 at 8:30 in the morning.
xxxx
SO ORDERED.10
This time, the RTC held that the ruling on the grounds relied upon by petitioner for filing the petition
is premature considering that a full-blown trial has not yet taken place. The court stressed that the
petition was sufficient in form and substance. It was verified, it included a certification against forum
shopping, and it contained a plain, concise, and direct statement of the ultimate facts on which
petitioner relies on for his claim, in accordance with Section 1, Rule 8 of the Rules of Court. The
court remarked that the allegation that the statements in the petition were not of petitioner’s personal
knowledge is a matter of evidence. The court also dismissed respondent’s arguments that there is
no basis for the taking of DNA test, and that jurisprudence is still unsettled on the acceptability of
DNA evidence. It noted that the new Rule on DNA Evidence11 allows the conduct of DNA testing,
whether at the court’s instance or upon application of any person who has legal interest in the matter
in litigation.
Respondent filed a Motion for Reconsideration of Order dated October 20, 2008 and for Dismissal of
Petition,12 reiterating that (a) the petition was not in due form and substance as no defendant was
named in the title, and all the basic allegations were hearsay; and (b) there was no prima facie case,
which made the petition susceptible to dismissal.
The RTC denied the motion in the Order dated January 19, 2009, and rescheduled the hearing.13
Aggrieved, respondent filed a petition for certiorari with the CA, questioning the Orders dated
October 20, 2008 and January 19, 2009.
On September 25, 2009, the CA decided the petition for certiorari in favor of respondent, thus:
WHEREFORE, the instant petition for certiorari is hereby GRANTED for being meritorious. The
assailed Orders dated October 20, 2008 and January 19, 2009 both issued by the Regional Trial
Court, Branch 172 of Valenzuela City in SP. Proceeding Case No. 30-V-07 are REVERSED and
SET ASIDE. Accordingly, the case docketed as SP. Proceeding Case No. 30-V-07 is DISMISSED.14
The CA held that the RTC did not acquire jurisdiction over the person of respondent, as no
summons had been served on him. Respondent’s special appearance could not be considered as
voluntary appearance because it was filed only for the purpose of questioning the jurisdiction of the
court over respondent. Although respondent likewise questioned the court’s jurisdiction over the
subject matter of the petition, the same is not equivalent to a waiver of his right to object to the
jurisdiction of the court over his person.
The CA remarked that petitioner filed the petition to establish illegitimate filiation, specifically seeking
a DNA testing order to abbreviate the proceedings. It noted that petitioner failed to show that the four
significant procedural aspects of a traditional paternity action had been met. The CA further held that
a DNA testing should not be allowed when the petitioner has failed to establish a prima facie case,
thus:
While the tenor [of Section 4, Rule on DNA Evidence] appears to be absolute, the rule could not
really have been intended to trample on the substantive rights of the parties. It could have not meant
to be an instrument to promote disorder, harassment, or extortion. It could have not been intended to
legalize unwarranted expedition to fish for evidence. Such will be the situation in this particular case
if a court may at any time order the taking of a DNA test. If the DNA test in compulsory recognition
cases is immediately available to the petitioner/complainant without requiring first the presentation of
corroborative proof, then a dire and absurd rule would result. Such will encourage and promote
harassment and extortion.
xxxx
At the risk of being repetitious, the Court would like to stress that it sees the danger of allowing an
absolute DNA testing to a compulsory recognition test even if the plaintiff/petitioner failed to establish
prima facie proof. x x x If at anytime, motu proprio and without pre-conditions, the court can indeed
order the taking of DNA test in compulsory recognition cases, then the prominent and well-to-do
members of our society will be easy prey for opportunists and extortionists. For no cause at all, or
even for [sic] casual sexual indiscretions in their younger years could be used as a means to harass
them. Unscrupulous women, unsure of the paternity of their children may just be taking the chances-
just in case-by pointing to a sexual partner in a long past one-time encounter. Indeed an absolute
and unconditional taking of DNA test for compulsory recognition case opens wide the opportunities
for extortionist to prey on victims who have no stomach for scandal.15
Petitioner moved for reconsideration. On December 17, 2009, the CA denied the motion for lack of
merit.16
In this petition for review on certiorari, petitioner raises the following issues:
I.
WHETHER OR NOT THE COURT OF APPEALS ERRED WHEN IT RESOLVED THE

ISSUE OF LACK OF JURISDICTION OVER THE PERSON OF HEREIN RESPONDENT
ALBEIT THE SAME WAS NEVER RAISED IN THE PETITION FOR CERTIORARI.
I.A
WHETHER OR NOT THE COURT OF APPEALS ERRED WHEN IT RULED THAT

JURISDICTION WAS NOT ACQUIRED OVER THE PERSON OF THE
RESPONDENT.
I.B
WHETHER OR NOT THE COURT OF APPEALS ERRED WHEN IT FAILED TO

REALIZE THAT THE RESPONDENT HAD ALREADY SUBMITTED VOLUNTARILY
TO THE JURISDICTION OF THE COURT A QUO.
I.C
WHETHER OR NOT THE COURT OF APPEALS ERRED WHEN IT ESSENTIALLY

RULED THAT THE TITLE OF A PLEADING, RATHER THAN ITS BODY, IS
CONTROLLING.
II.
WHETHER OR NOT THE COURT OF APPEALS ERRED WHEN IT ORDERED THE

DISMISSAL OF THE PETITION BY REASON OF THE MOTION (FILED BY THE
PETITIONER BEFORE THE COURT A QUO) FOR THE CONDUCT OF DNA TESTING.
II.A
WHETHER OR NOT THE COURT OF APPEALS ERRED WHEN IT ESSENTIALLY RULED
THAT DNA TESTING CAN ONLY BE ORDERED AFTER THE PETITIONER ESTABLISHES
PRIMA FACIE PROOF OF FILIATION.
III.
WHETHER OR NOT THE COURT OF APPEALS ERRED WITH ITS MISPLACED

RELIANCE ON THE CASE OF HERRERA VS. ALBA,
ESPECIALLY AS REGARDS THE ‘FOUR SIGNIFICANT PROCEDURAL ASPECTS OF A

TRADITIONAL PATERNITY ACTION.’17
Petitioner contends that respondent never raised as issue in his petition for certiorari the court’s lack
of jurisdiction over his person. Hence, the CA had no legal basis to discuss the same, because
issues not raised are deemed waived or abandoned. At any rate, respondent had already voluntarily
submitted to the jurisdiction of the trial court by his filing of several motions asking for affirmative
relief, such as the (a) Motion for Reconsideration of the Order dated September 3, 2007; (b) Ex
Parte Motion to Resolve Motion for Reconsideration of the Order dated November 6, 2007; and (c)
Motion for Reconsideration of the Order dated October 20, 2008 and for Dismissal of Petition.
Petitioner points out that respondent even expressly admitted that he has waived his right to
summons in his Manifestation and Comment on Petitioner’s Very Urgent Motion to Try and Hear the
Case. Hence, the issue is already moot and academic.
Petitioner argues that the case was adversarial in nature. Although the caption of the petition does
not state respondent’s name, the body of the petition clearly indicates his name and his known
address. He maintains that the body of the petition is controlling and not the caption.
Finally, petitioner asserts that the motion for DNA testing should not be a reason for the dismissal of
the petition since it is not a legal ground for the dismissal of cases. If the CA entertained any doubt
as to the propriety of DNA testing, it should have simply denied the motion.18 Petitioner points out
that Section 4 of the Rule on DNA Evidence does not require that there must be a prior proof of
filiation before DNA testing can be ordered. He adds that the CA erroneously relied on the four
significant procedural aspects of a paternity case, as enunciated in Herrera v. Alba.19 Petitioner avers
that these procedural aspects are not applicable at this point of the proceedings because they are
matters of evidence that should be taken up during the trial.20
In his Comment, respondent supports the CA’s ruling on most issues raised in the petition for
certiorari and merely reiterates his previous arguments. However, on the issue of lack of jurisdiction,
respondent counters that, contrary to petitioner’s assertion, he raised the issue before the CA in
relation to his claim that the petition was not in due form and substance. Respondent denies that he
waived his right to the service of summons. He insists that the alleged waiver and voluntary
appearance was conditional upon a finding by the court that summons is indeed required. He avers
that the assertion of affirmative defenses, aside from lack of jurisdiction over the person of the
defendant, cannot be considered as waiver of the defense of lack of jurisdiction over such person.
The petition is meritorious.
Primarily, we emphasize that the assailed Orders of the trial court were orders denying respondent’s
motion to dismiss the petition for illegitimate filiation. An order denying a motion to dismiss is an
interlocutory order which neither terminates nor finally disposes of a case, as it leaves something to
be done by the court before the case is finally decided on the merits. As such, the general rule is that
the denial of a motion to dismiss cannot be questioned in a special civil action for certiorari, which is
a remedy designed to correct errors of jurisdiction and not errors of judgment. Neither can a denial of
a motion to dismiss be the subject of an appeal unless and until a final judgment or order is
rendered. In a number of cases, the court has granted the extraordinary remedy of certiorari on the
denial of the motion to dismiss but only when it has been tainted with grave abuse of discretion
amounting to lack or excess of jurisdiction.21 In the present case, we discern no grave abuse of
discretion on the part of the trial court in denying the motion to dismiss.
The grounds for dismissal relied upon by respondent were (a) the court’s lack of jurisdiction over his
person due to the absence of summons, and (b) defect in the form and substance of the petition to
establish illegitimate filiation, which is equivalent to failure to state a cause of action.
We need not belabor the issues on whether lack of jurisdiction was raised before the CA, whether
the court acquired jurisdiction over the person of respondent, or whether respondent waived his right
to the service of summons. We find that the primordial issue here is actually whether it was
necessary, in the first place, to serve summons on respondent for the court to acquire jurisdiction
over the case. In other words, was the service of summons jurisdictional? The answer to this
question depends on the nature of petitioner’s action, that is, whether it is an action in personam, in
rem, or quasi in rem.
An action in personam is lodged against a person based on personal liability; an action in rem is
directed against the thing itself instead of the person; while an action quasi in rem names a person
as defendant, but its object is to subject that person's interest in a property to a corresponding lien or
obligation. A petition directed against the "thing" itself or the res, which concerns the status of a
person, like a petition for adoption, annulment of marriage, or correction of entries in the birth
certificate, is an action in rem.22
In an action in personam, jurisdiction over the person of the defendant is necessary for the court to
validly try and decide the case. In a proceeding in rem or quasi in rem, jurisdiction over the person of
the defendant is not a prerequisite to confer jurisdiction on the court, provided that the latter has
jurisdiction over the res. Jurisdiction over the res is acquired either (a) by the seizure of the property
under legal process, whereby it is brought into actual custody of the law, or (b) as a result of the
institution of legal proceedings, in which the power of the court is recognized and made effective. 23
The herein petition to establish illegitimate filiation is an action in rem. By the simple filing of the
petition to establish illegitimate filiation before the RTC, which undoubtedly had jurisdiction over the
subject matter of the petition, the latter thereby acquired jurisdiction over the case. An in
rem proceeding is validated essentially through publication. Publication is notice to the whole world
that the proceeding has for its object to bar indefinitely all who might be minded to make an objection
of any sort to the right sought to be established.24 Through publication, all interested parties are
deemed notified of the petition.
If at all, service of summons or notice is made to the defendant, it is not for the purpose of vesting
the court with jurisdiction, but merely for satisfying the due process requirements.25 This is but proper
in order to afford the person concerned the opportunity to protect his interest if he so
chooses.26 Hence, failure to serve summons will not deprive the court of its jurisdiction to try and
decide the case. In such a case, the lack of summons may be excused where it is determined that
the adverse party had, in fact, the opportunity to file his opposition, as in this case. We find that the
due process requirement with respect to respondent has been satisfied, considering that he has
participated in the proceedings in this case and he has the opportunity to file his opposition to the
petition to establish filiation.
To address respondent’s contention that the petition should have been adversarial in form, we
further hold that the herein petition to establish filiation was sufficient in form. It was indeed
adversarial in nature despite its caption which lacked the name of a defendant, the failure to implead
respondent as defendant, and the non-service of summons upon respondent. A proceeding is
adversarial where the party seeking relief has given legal warning to the other party and afforded the
latter an opportunity to contest it.27 In this petition—classified as an action in rem—the notice
requirement for an adversarial proceeding was likewise satisfied by the publication of the petition
and the giving of notice to the Solicitor General, as directed by the trial court.
The petition to establish filiation is sufficient in substance. It satisfies Section 1, Rule 8 of the Rules
of Court, which requires the complaint to contain a plain, concise, and direct statement of the
ultimate facts upon which the plaintiff bases his claim. A fact is essential if it cannot be stricken out
without leaving the statement of the cause of action inadequate.28 A complaint states a cause of
action when it contains the following elements: (1) the legal right of plaintiff, (2) the correlative
obligation of the defendant, and (3) the act or omission of the defendant in violation of said legal
right.29
The petition sufficiently states the ultimate facts relied upon by petitioner to establish his filiation to
respondent. Respondent, however, contends that the allegations in the petition were hearsay as
they were not of petitioner’s personal knowledge. Such matter is clearly a matter of evidence that
cannot be determined at this point but only during the trial when petitioner presents his evidence.
In a motion to dismiss a complaint based on lack of cause of action, the question submitted to the
court for determination is the sufficiency of the allegations made in the complaint to constitute a
cause of action and not whether those allegations of fact are true, for said motion must
hypothetically admit the truth of the facts alleged in the complaint.30
The inquiry is confined to the four corners of the complaint, and no other.31 The test of the sufficiency
of the facts alleged in the complaint is whether or not, admitting the facts alleged, the court could
render a valid judgment upon the same in accordance with the prayer of the complaint.32
If the allegations of the complaint are sufficient in form and substance but their veracity and
correctness are assailed, it is incumbent upon the court to deny the motion to dismiss and require
the defendant to answer and go to trial to prove his defense. The veracity of the assertions of the
parties can be ascertained at the trial of the case on the merits.33
The statement in Herrera v. Alba34 that there are four significant procedural aspects in a traditional
paternity case which parties have to face has been widely misunderstood and misapplied in this
case. A party is confronted by these so-called procedural aspects during trial, when the parties have
presented their respective evidence. They are matters of evidence that cannot be determined at this
initial stage of the proceedings, when only the petition to establish filiation has been filed. The CA’s
observation that petitioner failed to establish a prima facie case—the first procedural aspect in a
paternity case—is therefore misplaced. A prima facie case is built by a party’s evidence and not by
mere allegations in the initiatory pleading.
Clearly then, it was also not the opportune time to discuss the lack of a prima facie case vis-à-vis the
motion for DNA testing since no evidence has, as yet, been presented by petitioner. More
essentially, it is premature to discuss whether, under the circumstances, a DNA testing order is
warranted considering that no such order has yet been issued by the trial court. In fact, the latter has
just set the said case for hearing.
At any rate, the CA’s view that it would be dangerous to allow a DNA testing without corroborative
proof is well taken and deserves the Court’s attention. In light of this observation, we find that there
is a need to supplement the Rule on DNA Evidence to aid the courts in resolving motions for DNA
testing order, particularly in paternity and other filiation cases. We, thus, address the question of
whether a prima facie showing is necessary before a court can issue a DNA testing order.
The Rule on DNA Evidence was enacted to guide the Bench and the Bar for the introduction and
use of DNA evidence in the judicial system. It provides the "prescribed parameters on the requisite
elements for reliability and validity (i.e., the proper procedures, protocols, necessary laboratory
reports, etc.), the possible sources of error, the available objections to the admission of DNA test
results as evidence as well as the probative value of DNA evidence." It seeks "to ensure that the
evidence gathered, using various methods of DNA analysis, is utilized effectively and properly, [and]
shall not be misused and/or abused and, more importantly, shall continue to ensure that DNA
analysis serves justice and protects, rather than prejudice the public."35
Not surprisingly, Section 4 of the Rule on DNA Evidence merely provides for conditions that are
aimed to safeguard the accuracy and integrity of the DNA testing. Section 4 states:
SEC. 4. Application for DNA Testing Order. – The appropriate court may, at any time, either motu
proprio or on application of any person who has a legal interest in the matter in litigation, order a
DNA testing. Such order shall issue after due hearing and notice to the parties upon a showing of
the following:
(a) A biological sample exists that is relevant to the case;
(b) The biological sample: (i) was not previously subjected to the type of DNA testing now
requested; or (ii) was previously subjected to DNA testing, but the results may require
confirmation for good reasons;
(c) The DNA testing uses a scientifically valid technique;
(d) The DNA testing has the scientific potential to produce new information that is relevant to
the proper resolution of the case; and
(e) The existence of other factors, if any, which the court may consider as potentially
affecting the accuracy or integrity of the DNA testing.
This Rule shall not preclude a DNA testing, without need of a prior court order, at the behest of any
party, including law enforcement agencies, before a suit or proceeding is commenced.
This does not mean, however, that a DNA testing order will be issued as a matter of right if, during
the hearing, the said conditions are established.
In some states, to warrant the issuance of the DNA testing order, there must be a show cause
hearing wherein the applicant must first present sufficient evidence to establish a prima facie case or
a reasonable possibility of paternity or "good cause" for the holding of the test. 36 In these states, a
court order for blood testing is considered a "search," which, under their Constitutions (as in ours),
must be preceded by a finding of probable cause in order to be valid. Hence, the requirement of a
prima facie case, or reasonable possibility, was imposed in civil actions as a counterpart of a finding
of probable cause. The Supreme Court of Louisiana eloquently explained —
Although a paternity action is civil, not criminal, the constitutional prohibition against unreasonable
searches and seizures is still applicable, and a proper showing of sufficient justification under the
particular factual circumstances of the case must be made before a court may order a compulsory
blood test. Courts in various jurisdictions have differed regarding the kind of procedures which are
required, but those jurisdictions have almost universally found that a preliminary showing must be
made before a court can constitutionally order compulsory blood testing in paternity cases. We
agree, and find that, as a preliminary matter, before the court may issue an order for compulsory
blood testing, the moving party must show that there is a reasonable possibility of paternity. As
explained hereafter, in cases in which paternity is contested and a party to the action refuses to
voluntarily undergo a blood test, a show cause hearing must be held in which the court can
determine whether there is sufficient evidence to establish a prima facie case which warrants
issuance of a court order for blood testing.37
1avvphi1
The same condition precedent should be applied in our jurisdiction to protect the putative father from
mere harassment suits. Thus, during the hearing on the motion for DNA testing, the petitioner must
present prima facie evidence or establish a reasonable possibility of paternity.
Notwithstanding these, it should be stressed that the issuance of a DNA testing order remains
discretionary upon the court. The court may, for example, consider whether there is absolute
necessity for the DNA testing. If there is already preponderance of evidence to establish paternity
and the DNA test result would only be corroborative, the court may, in its discretion, disallow a DNA
testing.
WHEREFORE, premises considered, the petition is GRANTED. The Court of Appeals Decision
dated September 25, 2009 and Resolution dated December 17, 2009 are REVERSED and SET
ASIDE. The Orders dated October 20, 2008 and January 19, 2009 of the Regional Trial Court of
Valenzuela City are AFFIRMED.
SO ORDERED.
G.R. No. 128803 September 25, 1998
ASIAVEST LIMITED, petitioner,
vs.
THE COURT OF APPEALS and ANTONIO HERAS, respondents.
DAVIDE, JR., J.:
In issue is the enforceability in the Philippines of a foreign judgment. The antecedents are
summarized in the 24 August 1990 Decision of Branch 107 of the Regional Trial Court of Quezon
1
City in Civil Case No. Q-52452; thus:
The plaintiff Asiavest Limited filed a complaint on December 3, 1987 against the
defendant Antonio Heras praying that said defendant be ordered to pay to the
plaintiff the amounts awarded by the Hong Kong Court Judgment dated December
28, 1984 and amended on April 13, 1987, to wit:
1) US$1,810,265.40 or its equivalent in Hong Kong

currency at the time of payment with legal interest
from December 28, 1984 until fully paid;
2) interest on the sum of US$1,500.00 at 9.875% per

annum from October 31, 1984 to December 28, 1984;
and
3) HK$905.00 at fixed cost in the action; and
4) at least $80,000.00 representing attorney's fees,

litigation expenses and cost, with interest thereon
from the date of the judgment until fully paid.
On March 3, 1988, the defendant filed a Motion to Dismiss. However, before the
court could resolve the said motion, a fire which partially razed the Quezon City Hall
Building on June 11, 1988 totally destroyed the office of this Court, together with all
its records, equipment and properties. On July 26, 1988, the plaintiff, through counsel
filed a Motion for Reconstitution of Case Records. The Court, after allowing the
defendant to react thereto, granted the said Motion and admitted the annexes
attached thereto as the reconstituted records of this case per Order dated September
6, 1988. Thereafter, the Motion to Dismiss, the resolution of which had been
deferred; was denied by the Court in its Order of October 4, 1988.
On October 19, 1988, defendant filed his Answer. The case was then set for pre-trial
conference. At the conference, the parties could not arrive at any settlement.
However, they agreed on the following stipulations of facts:
1. The defendant admits the existence of the

judgment dated December 28, 1984 as well as its
amendment dated April 13, 1987, but not necessarily
the authenticity or validity thereof;
2. The plaintiff is not doing business and is not

licensed to do business in the Philippines;
3. The residence of defendant, Antonio Heras, is New

Manila, Quezon City.
The only issue for this Court to determine is, whether or not the judgment of the
Hong Kong Court has been repelled by evidence of want of jurisdiction, want of
notice to the party, collusion, fraud or clear mistake of law or fact, such as to
overcome the presumption established in Section 50, Rule 39 of the Rules of Court
in favor of foreign judgments.
In view of the admission by the defendant of the existence of the aforementioned

judgment (Pls. See Stipulations of Facts in the Order dated January 5, 1989 as
amended by the Order of January 18, 1989), as well as the legal presumption in
favor of the plaintiff as provided for in paragraph (b); Sec. 50, (Ibid.), the plaintiff
presented only documentary evidence to show rendition, existence, and
authentication of such judgment by the proper officials concerned (Pls. See Exhibits
"A" thru "B", with their submarkings). In addition, the plaintiff presented testimonial
and documentary evidence to show its entitlement to attorney's fees and other
expenses of litigation. . . . .
On the other hand, the defendant presented two witnesses, namely. Fortunata dela
Vega and Russel Warren Lousich.
The gist of Ms. dela Vega's testimony is to the effect that no writ of summons or copy
of a statement of claim of Asiavest Limited was ever served in the office of the
Navegante Shipping Agency Limited and/or for Mr. Antonio Heras, and that no
service of the writ of summons was either served on the defendant at his residence
in New Manila, Quezon City. Her knowledge is based on the fact that she was the
personal secretary of Mr. Heras during his JD Transit days up to the latter part of
1972 when he shifted or diversified to shipping business in Hong Kong; that she was
in-charge of all his letters and correspondence, business commitments,
undertakings, conferences and appointments, until October 1984 when Mr. Heras left
Hong Kong for good; that she was also the Officer-in-Charge or Office Manager of
Navegante Shipping Agency LTD, a Hong Kong registered and based company
acting as ships agent, up to and until the company closed shop sometime in the first
quarter of 1985, when shipping business collapsed worldwide; that the said company
held office at 34-35 Connaught Road, Central Hong Kong and later transferred to
Carton House at Duddel Street, Hong Kong, until the company closed shop in 1985;
and that she was certain of such facts because she held office at Caxton House up
to the first quarter of 1985.
Mr. Lousich was presented as an expert on the laws of Hong Kong, and as a
representative of the law office of the defendant's counsel who made a verification of
the record of the case filed by the plaintiff in Hong Kong against the defendant, as
well as the procedure in serving Court processes in Hong Kong.
In his affidavit (Exh. "2") which constitutes his direct testimony, the said witness
stated that:
The defendant was sued on the basis of his personal guarantee of

the obligations of Compania Hermanos de Navegacion S.A. There is
no record that a writ of summons was served on the person of the
defendant in Hong Kong, or that any such attempt at service was
made. Likewise, there is no record that a copy of the judgment of the
High Court was furnished or served on the defendant; anyway, it is
not a legal requirement to do so under Hong Kong laws;
a) The writ of summons or claim can be served by the

solicitor (lawyer) of the claimant or plaintiff. In Hong
Kong there are no Court personnel who serve writs of
summons and/or most other processes.
b) If the writ of summons or claim (or complaint) is not

contested, the claimant or the plaintiff is not required
to present proof of his claim or complaint nor present
evidence under oath of the claim in order to obtain a
Judgment.
c) There is no legal requirement that such a Judgment

or decision rendered by the Court in Hong Kong [to]
make a recitation of the facts or the law upon which
the claim is based.
d) There is no necessity to furnish the defendant with

a copy of the Judgment or decision rendered against
him.
e) In an action based on a guarantee, there is no

established legal requirement or obligation under
Hong Kong laws that the creditor must first bring
proceedings against the principal debtor. The creditor
can immediately go against the guarantor.
On cross examination, Mr. Lousich stated that before he was commissioned by the
law firm of the defendant's counsel as an expert witness and to verify the records of
the Hong Kong case, he had been acting as counsel for the defendant in a number of
commercial matters; that there was an application for service of summons upon the
defendant outside the jurisdiction of Hong Kong; that there was an order of the Court
authorizing service upon Heras outside of Hong Kong, particularly in Manila or any
other place in the Philippines (p. 9, TSN, 2/14/90); that there must be adequate proof
of service of summons, otherwise the Hong Kong Court will refuse to render
judgment (p. 10, ibid); that the mere fact that the Hong Kong Court rendered
judgment, it can be presumed that there was service of summons; that in this case, it
is not just a presumption because there was an affidavit stating that service was
effected in [sic] a particular man here in Manila; that such affidavit was filed by one
Jose R. Fernandez of the firm Sycip Salazar on the 21st of December 1984, and
stated in essence that "on Friday, the 23rd of November 1984 he served the 4th
defendant at No. 6 First Street, Quezon City by leaving it at that address with Mr.
Dionisio Lopez, the son-in-law of the 4th defendant the copy of the writ and Mr.
Lopez informed me and I barely believed that he would bring the said writ to the
attention of the 4th defendant" (pp. 11-12, ibid.); that upon filing of that affidavit, the
Court was asked and granted judgment against the 4th defendant; and that if the
summons or claim is not contested, the claimant of the plaintiff is not required to
present proof of his claim or complaint or present evidence under oath of the claim in
order to obtain judgment; and that such judgment can be enforced in the same
manner as a judgment rendered after full hearing.
The trial court held that since the Hong Kong court judgment had been duly proved, it is a
presumptive evidence of a right as between the parties; hence, the party impugning it had the
burden to prove want of jurisdiction over his person. HERAS failed to discharge that burden. He did
not testify to state categorically and under oath that he never received summons. Even his own
witness Lousich admitted that HERAS was served with summons in his Quezon City residence. As
to De la Vega's testimony regarding non-service of summons, the same was hearsay and had no
probative value.
As to HERAS' contention that the Hong Kong court judgment violated the Constitution and the
procedural laws of the Philippines because it contained no statements of the facts and the law on
which it was based, the trial court ruled that since the issue relate to procedural matters, the law of
the forum, i.e., Hong Kong laws, should govern. As testified by the expert witness Lousich, such
legalities were not required under Hong Kong laws. The trial Court also debunked HERAS'
contention that the principle of excussion under Article 2058 of the Civil Code of the Philippines was
violated. It declared that matters of substance are subject to the law of the place where the
transaction occurred; in this case, Hong Kong laws must govern.
The trial court concluded that the Hong Kong court judgment should be recognized and given effect
in this jurisdiction for failure of HERAS to overcome the legal presumption in favor of the foreign
judgment. It then decreed; thus:
WHEREFORE, judgment is hereby rendered ordering defendant to pay to the plaintiff

the following sums or their equivalents in Philippine currency at the time of payment:
US$1,810,265.40 plus interest on the sum of US$1,500,000.00 at 9.875% per annum
from October 31, 1984 to December 28, 1984, and HK$905 as fixed cost, with legal
interests on the aggregate amount from December 28, 1984, and to pay attorney's
fees in the sum of P80,000.00.
ASIAVEST moved for the reconsideration of the decision. It sought an award of judicial costs and an
increase in attorney's fees in the amount of US$19,346.45 with interest until full payment of the said
obligations. On the other hand, HERAS no longer opposed the motion and instead appealed the
decision to the Court of Appeals, which docketed the appeal as CA-G.R. CV No. 29513.
In its order of 2 November 1990, the trial court granted ASIAVEST's motion for reconsideration by
2
increasing the award of attorney's fees to "US$19,345.65 OR ITS EQUIVALENT IN PHILIPPINE

CURRENCY, AND TO PAY THE COSTS OF THIS SUIT," provided that ASIAVEST would pay the
corresponding filing fees for the increase. ASIAVEST appealed the order requiring prior payment of
filing fees. However, it later withdrew its appeal and paid the additional filing fees.
On 3 April 1997, the Court of Appeals rendered its decision reversing the decision of the trial court
3
and dismissing ASIAVEST's complaint without prejudice. It underscored the fact that a foreign
judgment does not of itself have any extraterritorial application. For it to be given effect, the foreign
tribunal should have acquired jurisdiction over the person and the subject matter. If such tribunal has
not acquired jurisdiction, its judgment is void.
The Court of Appeals agreed with the trial court that matters of remedy and procedure, such as
those relating to service of summons upon the defendant are governed by the lex fori, which was, in
this case, the law of Hong Kong. Relative thereto, it gave weight to Lousich's testimony that under
the Hong Kong law, the substituted service of summons upon HERAS effected in the Philippines by
the clerk of Sycip Salazar Hernandez & Gatmaitan firm would be valid provided that it was done in
accordance with Philippine laws. It then stressed that where the action is in personam and the
defendant is in the Philippines, the summons should be personally served on the defendant pursuant
to Section 7, Rule 14 of the Rules of Court. Substituted service may only be availed of where the
4
defendant cannot be promptly served in person, the fact of impossibility of personal service should
be explained in the proof of service. It also found as persuasive HERAS' argument that instead of
directly using the clerk of the Sycip Salazar Hernandez & Gatmaitan law office, who was not
authorized by the judge of the court issuing the summons, ASIAVEST should have asked for leave
of the local courts to have the foreign summons served by the sheriff or other court officer of the
place where service was to be made, or for special reasons by any person authorized by the judge.
The Court of Appeals agreed with HERAS that "notice sent outside the state to a non-resident is
unavailing to give jurisdiction in an action against him personally for money recovery." Summons
should have been personally served on HERAS in Hong Kong, for, as claimed by ASIAVEST,
HERAS was physically present in Hong Kong for nearly 14 years. Since there was not even an
attempt to serve summons on HERAS in Hong Kong, the Hong Kong Supreme Court did not acquire
jurisdiction over HERAS. Nonetheless it did not totally foreclose the claim of ASIAVEST; thus:
While We are not fully convinced that [HERAS] has a meritorious defense against
[ASIAVEST's] claims or that [HERAS] ought to be absolved of any liability,
nevertheless, in view of the foregoing discussion, there is a need to deviate front the
findings of the lower court in the interest of justice and fair play. This, however, is
without prejudice to whatever action [ASIAVEST] might deem proper in order to
enforce its claims against [HERAS].
Finally, the Court of Appeals also agreed with HERAS that it was necessary that evidence
supporting the validity of the foreign judgment be submitted, and that our courts are not bound to
give effect to foreign judgments which contravene our laws and the principle of sound morality and
public policy.
ASIAVEST forthwith filed the instant petition alleging that the Court of Appeals erred in ruling that
I.
. . . IT WAS NECESSARY FOR [ASIAVEST] TO PRESENT EVIDENCE

"SUPPORTING THE VALIDITY OF THE JUDGMENT";
II.
. . . THE SERVICE OF SUMMONS ON [HERAS] WAS DEFECTIVE UNDER

PHILIPPINES LAW;
III.
. . . SUMMONS SHOULD HAVE BEEN PERSONALLY SERVED ON HERAS IN

HONG KONG;
IV.
. . . THE HONG KONG SUMMONS SHOULD HAVE BEEN SERVED WITH LEAVE
OF PHILIPPINE COURTS;
V.
. . . THE FOREIGN JUDGMENT "CONTRAVENES PHILIPPINE LAWS, THE

PRINCIPLES OF SOUND MORALITY, AND THE PUBLIC POLICY OF THE
PHILIPPINES.
Being interrelated, we shall take up together the assigned errors.

Under paragraph (b) of Section 50, Rule 39 of the Rules of Court, which was the governing law at
5
the time this case was decided by the trial court and respondent Court of Appeals, a foreign
judgment against a person rendered by a court having jurisdiction to pronounce the judgment is
presumptive evidence of a right as between the parties and their successors in interest by the
subsequent title. However, the judgment may be repelled by evidence of want of jurisdiction, want of
notice to the party, collusion, fraud, or clear mistake of law or fact.
Also, Section 3(n) of Rule 131 of the New Rules of Evidence provides that in the absence of proof to
the contrary, a court, or judge acting as such, whether in the Philippines or elsewhere, is presumed
to have acted in the lawful exercise of jurisdiction.
Hence, once the authenticity of the foreign judgment is proved, the burden to repel it on grounds
provided for in paragraph (b) of Section 50, Rule 39 of the Rules of Court is on the party challenging
the foreign judgment — HERAS in this case.
At the pre-trial conference, HERAS admitted the existence of the Hong Kong judgment. On the other
hand, ASIAVEST presented evidence to prove rendition, existence, and authentication of the
judgment by the proper officials. The judgment is thus presumed to be valid and binding in the
country from which it comes, until the contrary is shown. Consequently, the first ground relied upon
6
by ASIAVEST has merit. The presumption of validity accorded foreign judgment would be rendered
meaningless were the party seeking to enforce it be required to first establish its validity.
The main argument raised against the Hong Kong judgment is that the Hong Kong Supreme Court
did not acquire jurisdiction over the person of HERAS. This involves the issue of whether summons
was properly and validly served on HERAS. It is settled that matters of remedy and procedure such
as those relating to the service of process upon the defendant are governed by the lex fori or the law
of the forum, i.e., the law of Hong Kong in this case. HERAS insisted that according to his witness
7
Mr. Lousich, who was presented as an expert on Hong Kong laws, there was no valid service of
summons on him.
In his counter-affidavit, which served as his direct testimony per agreement of the parties, Lousich
8 9
declared that the record of the Hong Kong case failed to show that a writ of summons was served
upon HERAS in Hong Kong or that any such attempt was made. Neither did the record show that a
copy of the judgment of the court was served on HERAS. He stated further that under Hong Kong
laws (a) a writ of summons could be served by the solicitor of the claimant or plaintiff; and (b) where
the said writ or claim was not contested, the claimant or plaintiff was not required to present proof
under oath in order to obtain judgment.
On cross-examination by counsel for ASIAVEST, Lousich' testified that the Hong Kong court
authorized service of summons on HERAS outside of its jurisdiction, particularly in the Philippines.
He admitted also the existence of an affidavit of one Jose R. Fernandez of the Sycip Salazar
Hernandez & Gatmaitan law firm stating that he (Fernandez) served summons on HERAS on 13
November 1984 at No. 6, 1st St., Quezon City, by leaving a copy with HERAS's son-in-law Dionisio
Lopez. On redirect examination, Lousich declared that such service of summons would be valid
10
under Hong Kong laws provided that it was in accordance with Philippine laws. 11
We note that there was no objection on the part of ASIAVEST on the qualification of Mr. Lousich as
an expert on the Hong Kong law. Under Sections 24 and 25, Rule 132 of the New Rules of
Evidence, the record of public documents of a sovereign authority, tribunal, official body, or public
officer may be proved by (1) an official publication thereof or (2) a copy attested by the officer having
the legal custody thereof, which must be accompanied, if the record is not kept in the Philippines,
with a certificate that such officer has the custody. The certificate may be issued by a secretary of
the embassy or legation, consul general, consul, vice consul, or consular agent, or any officer in the
foreign service of the Philippines stationed in the foreign country in which the record is kept, and
authenticated by the seal of his office. The attestation must state, in substance, that the copy is a
correct copy of the original, or a specific part thereof, as the case may be, and must be under the
official seal of the attesting officer.
Nevertheless, the testimony of an expert witness may be allowed to prove a foreign law. An
authority on private international law thus noted:
12
Although it is desirable that foreign law be proved in accordance with the above rule,
however, the Supreme Court held in the case of Willamette Iron and Steel Works v.
Muzzal, that Section 41, Rule 123 (Section 25, Rule 132 of the Revised Rules of
13
Court) does not exclude the presentation of other competent evidence to prove the
existence of a foreign law. In that case, the Supreme Court considered the testimony
under oath of an attorney-at-law of San Francisco, California, who quoted verbatim a
section of California Civil Code and who stated that the same was in force at the time
the obligations were contracted, as sufficient evidence to establish the existence of
said law. Accordingly, in line with this view, the Supreme Court in the Collector of
Internal Revenue v. Fisher et al., upheld the Tax Court in considering the pertinent
14
law of California as proved by the respondents' witness. In that case, the counsel for
respondent "testified that as an active member of the California Bar since 1951, he is
familiar with the revenue and taxation laws of the State of California. When asked by
the lower court to state the pertinent California law as regards exemption of
intangible personal properties, the witness cited Article 4, Sec. 13851 (a) & (b) of the
California Internal and Revenue Code as published in Derring's California Code, a
publication of Bancroft-Whitney Co., Inc. And as part of his testimony, a full quotation
of the cited section was offered in evidence by respondents." Likewise, in several
naturalization cases, it was held by the Court that evidence of the law of a foreign
country on reciprocity regarding the acquisition of citizenship, although not meeting
the prescribed rule of practice, may be allowed and used as basis for favorable
action, if, in the light of all the circumstances, the Court is "satisfied of the authenticity
of the written proof offered." Thus, in, a number of decisions, mere authentication of
15
the Chinese Naturalization Law by the Chinese Consulate General of Manila was
held to be competent proof of that law. 16
There is, however, nothing in the testimony of Mr. Lousich that touched on the specific law of Hong
Kong in respect of service of summons either in actions in rem or in personam, and where the
defendant is either a resident or nonresident of Hong Kong. In view of the absence of proof of the
Hong Kong law on this particular issue, the presumption of identity or similarity or the so-called
processual presumption shall come into play. It will thus be presumed that the Hong Kong law on the
matter is similar to the Philippine law.
17
As stated in Valmonte vs. Court of Appeals, it will be helpful to determine first whether the action
18
is in personam, in rem, or quasi in rem because the rules on service of summons under Rule 14 of
the Rules of Court of the Philippines apply according to the nature of the action.
An action in personam is an action against a person on the basis of his personal liability. An
action in rem is an action against the thing itself instead of against the person. An action quasi in
19
rem is one wherein an individual is named as defendant and the purpose of the proceeding is to
subject his interest therein to the obligation or lien burdening the property. 20
In an action in personam, jurisdiction over the person of the defendant is necessary for the court to
validly try and decide the case. Jurisdiction over the person of a resident defendant who does not
voluntarily appear in court can be acquired by personal service of summons as provided under
Section 7, Rule 14 of the Rules of Court. If he cannot be personally served with summons within a
reasonable time, substituted service may be made in accordance with Section 8 of said Rule. If he is
temporarily out of the country, any of the following modes of service may be resorted to: (1)
substituted service set forth in Section 8; (2) personal service outside the country, with leave of
21
court; (3) service by publication, also with leave of court; or (4) any other manner the court may
22
deem sufficient. 23
However, in an action in personam wherein the defendant is a non-resident who does not voluntarily

submit himself to the authority of the court, personal service of summons within the state is essential
to the acquisition of jurisdiction over her person. This method of service is possible if such
24
defendant is physically present in the country. If he is not found therein, the court cannot acquire
jurisdiction over his person and therefore cannot validly try and decide the case against him. An 25
exception was laid down in Gemperle v. Schenker wherein a non-resident was served with
26
summons through his wife, who was a resident of the Philippines and who was his representatives
and attorney-in-fact in a prior civil case filed by him; moreover, the second case was a mere offshoot
of the first case.
On the other hand, in a proceeding in rem or quasi in rem, jurisdiction over the person of the
defendant is not a prerequisite to confer jurisdiction on the court provided that the court acquires
jurisdiction over the res. Nonetheless summons must be served upon the defendant not for the
purpose of vesting the court with jurisdiction but merely for satisfying the due process
requirements. Thus, where the defendant is a non-resident who is not found in the Philippines and
27
(1) the action affects the personal status of the plaintiff; (2) the action relates to, or the subject matter
of which is property in the Philippines in which the defendant has or claims a lien or interest; (3) the
action seeks the exclusion of the defendant from any interest in the property located in the
Philippines; or (4) the property of the defendant has been attached in the Philippines — service of
summons may be effected by (a) personal service out of the country, with leave of court; (b)
publication, also with leave of court, or (c) any other manner the court may deem sufficient. 28
In the case at bar, the action filed in Hong Kong against HERAS was in personam, since it was
based on his personal guarantee of the obligation of the principal debtor. Before we can apply the
foregoing rules, we must determine first whether HERAS was a resident of Hong Kong.
Fortunata de la Vega, HERAS's personal secretary in Hong Kong since 1972 until 1985, testified29
that HERAS was the President and part owner of a shipping company in Hong Kong during all those
times that she served as his secretary. He had in his employ a staff of twelve. He had "business
30
commitments, undertakings, conferences, and appointments until October 1984 when [he] left Hong
Kong for good," HERAS's other witness, Russel Warren Lousich, testified that he had acted as
31
counsel for HERAS "for a number of commercial matters." ASIAVEST then infers that HERAS was
32
a resident of Hong Kong because he maintained a business there.
It must be noted that in his Motion to Dismiss, as well as in his

33
Answer to ASIAVEST's complaint for the enforcement of the Hong Kong court judgment, HERAS
34
maintained that the Hong Kong court did not have jurisdiction over him because the fundamental
rule is that jurisdiction in personam over non-resident defendants, so as to sustain a money
judgment, must be based upon personal service of summons within the state which renders the
judgment. 35
For its part, ASIAVEST, in its Opposition to the Motion to Dismiss contended: "The question of
36
Hong Kong court's 'want of jurisdiction' is therefore a triable issue if it is to be pleaded by the
defendant to 'repel' the foreign judgment. Facts showing jurisdictional lack (e.g. that the Hong Kong
suit was in personam, that defendant was not a resident of Hong Kong when the suit was filed or
that he did not voluntarily submit to the Hong Kong court's jurisdiction) should be alleged and proved
by the defendant." 37
In his Reply (to the Opposition to Motion to Dismiss), HERAS argued that the lack of jurisdiction
38
over his person was corroborated by ASIAVEST's allegation in the complaint that he "has his
residence at No. 6, 1st St., New Manila, Quezon City, Philippines." He then concluded that such
judicial admission amounted to evidence that he was and is not a resident of Hong Kong.
Significantly, in the pre-trial conference, the parties came up with stipulations of facts, among which
was that "the residence of defendant, Antonio Heras, is New Manila, Quezon City." 39
We note that the residence of HERAS insofar as the action for the enforcement of the Hong Kong
court judgment is concerned, was never in issue. He never challenged the service of summons on
him through a security guard in his Quezon City residence and through a lawyer in his office in that
city. In his Motion to Dismiss, he did not question the jurisdiction of the Philippine court over his
person on the ground of invalid service of summons. What was in issue was his residence as far as
the Hong Kong suit was concerned. We therefore conclude that the stipulated fact that HERAS "is a
resident of New Manila, Quezon City, Philippines" refers to his residence at the time jurisdiction over
his person was being sought by the Hong Kong court. With that stipulation of fact, ASIAVEST cannot
now claim that HERAS was a resident of Hong Kong at the time.
Accordingly, since HERAS was not a resident of Hong Kong and the action against him was,
indisputably, one in personam, summons should have been personally served on him in Hong Kong.
The extraterritorial service in the Philippines was therefore invalid and did not confer on the Hong
Kong court jurisdiction over his person. It follows that the Hong Kong court judgment cannot be given
force and effect here in the Philippines for having been rendered without jurisdiction.
Even assuming that HERAS was formerly a resident of Hong Kong, he was no longer so in
November 1984 when the extraterritorial service of summons was attempted to be made on him. As
declared by his secretary, which statement was not disputed by ASIAVEST, HERAS left Hong Kong
in October 1984 "for good." His absence in Hong Kong must have been the reason why summons
40
was not served on him therein; thus, ASIAVEST was constrained to apply for leave to effect service
in the Philippines, and upon obtaining a favorable action on the matter, it commissioned the Sycip
Salazar Hernandez & Gatmaitan law firm to serve the summons here in the Philippines.
In Brown v. Brown, the defendant was previously a resident of the Philippines. Several days after a
41
criminal action for concubinage was filed against him, he abandoned the Philippines. Later, a
proceeding quasi in rem was instituted against him. Summons in the latter case was served on the
defendant's attorney-in-fact at the latter's address. The Court held that under the facts of the case, it
could not be said that the defendant was "still a resident of the Philippines because he ha[d]
escaped to his country and [was] therefore an absentee in the Philippines." As such, he should have
been "summoned in the same manner as one who does not reside and is not found in the
Philippines."
Similarly, HERAS, who was also an absentee, should have been served with summons in the same
manner as a non-resident not found in Hong Kong. Section 17, Rule 14 of the Rules of Court
providing for extraterritorial service will not apply because the suit against him was in personam.
Neither can we apply Section 18, which allows extraterritorial service on a resident defendant who is
temporarily absent from the country, because even if HERAS be considered as a resident of Hong
Kong, the undisputed fact remains that he left Hong Kong not only "temporarily" but "for good."
IN VIEW OF ALL THE FOREGOING, judgment is hereby rendered DENYING the petition in this
case and AFFIRMING the assailed judgment of the Court of Appeals in CA-G.R. CV No. 29513.
No costs.
SO ORDERED.
BA FINANCE CORPORATION, Petitioner, v. HON. COURT OF APPEALS and

ROBERTO M. REYES, Respondents.
The case at bar is a suit for replevin and damages. The petition for review
on certiorari assails the decision of the Court of Appeals 1 in CA-G.R. CV No. 23605
affirming that of the Regional Trial Court of Manila, Branch XX, 2 which has disposed of
its Civil Case No. 87-42270 in this wise: jgc:chanrobles.com.ph
"WHEREFORE, the case against defendant-spouses (sic) Reynaldo Manahan is hereby
dismissed without prejudice, for failure to prosecute. Plaintiff having failed to show the
liability of defendant John Doe in the person of Roberto M. Reyes, the case against the
latter should likewise be dismissed. Moreover, plaintiff is hereby directed to return the
vehicle seized by virtue of the order of seizure issued by this Court with all its
accessories to the said Roberto M. Reyes." 3
The decisions of both the appellate court and the court a quo are based on a like finding
of the facts hereinafter briefly narrated.
The spouses Reynaldo and Florencia Manahan executed, on 15 May 1980, a promissory
note 4 binding themselves to pay Carmasters, Inc., the amount of P83,080.00 in thirty-
six monthly installments commencing 01 July 1980. To secure payment, the Manahan
spouses executed a deed of chattel mortgage 5 over a motor vehicle, a Ford Cortina 1.6
GL. with motor and serial number CUBFWE-801010. Carmasters later assigned 6 the
promissory note and the chattel mortgage to petitioner BA Finance Corporation with the
conformity of the Manahans. When the latter failed to pay the due installments,
petitioner sent demand letters. The demands not having been heeded, Petitioner, on 02
October 1987, filed a complaint for replevin with damages against the spouses, as well
as against a John Doe, praying for the recovery of the vehicle with an alternative prayer
for the payment of a sum of money should the vehicle not be returned. Upon
petitioner’s motion and the filing of a bond in the amount of P169, 161.00 the lower
court issued a writ of replevin. The court, however, cautioned petitioner that should
summons be not served on the defendants within thirty (30) days from the writ’s
issuance, the case would be dismissed to failure to prosecute. 7 The warning was based
on what the court perceived to be the deplorable practice of some mortgagees of
"freezing (the) foreclosure or replevin cases" which they would so "conveniently utilize
as a leverage for the collection of unpaid installments on mortgaged chattels." 8
The service of summons upon the spouses Manahan was caused to be served by
petitioner at No. 35 Lantana St., Cubao, Quezon City. The original of the summons had
the name and the signature of private respondent Roberto M. Reyes indicating that he
received, on 14 October 1987, a copy of the summons and the complaint. 9
Forthwith, Petitioner, through its Legal Assistant, Danilo E. Solano, issued a certification
to the effect that it had received from Orson R. Santiago, the deputy sheriff of the
Regional Trial Court of Manila, Branch 20, the Ford Cortina seized from private
respondent Roberto M. Reyes, the John Doe referred to in the complaint, 10 in
Sorsogon, Sorsogon. 11 On 20 October 19871 the lower court came out with an order
of seizure.
Alleging possession in good faith, private respondent filed, on 26 October 1987, a

motion for an extension of time within which to file his answer and/or a motion for
intervention. The court granted the motion.
A few months later, or on 18 February 1988, the court issued an order which, in part,
stated:jgc:chanrobles.com.ph
"Perusal of the record shows that an order for the seizure of personal property was
issued on October 20, 1987 in pursuance to a previous order of the Court dated
October 13, 1987. However, to date, there is no showing that the principal defendants
were served with summons inspite of the lapse of four (4) months.
"Considering, this is a replevin case and to forestall the evils that arise from this
practice, plaintiff failing to heed the Order dated October 13, 1987, particularly second
paragraph thereof, the above-entitled case is hereby ordered DISMISSED for failure to
prosecute and further ordering the plaintiff to return the property seized with all its
accessories to defendant John Doe in the person of Roberto M. Reyes.
"SO ORDERED." 12
On 26 February 1988, petitioner filed a notice of dismissal of the case "without

prejudice and without pronouncement as to costs, before service of Summons and
Answer, under Section 1, Rule 17, of the Rules of Court." 13 It also sought in another
motion the withdrawal of the replevin bond. In view of the earlier dismissal of the case
(for petitioner’s failure to prosecute), the court, on 02 March 1988, merely noted the
notice of dismissal and denied the motion to withdraw the replevin bond considering
that the writ of replevin had meanwhile been implemented. 14
On 09 March 1988, private respondent filed a motion praying that petitioner be directed
to comply with the court order requiring petitioner to return the vehicle to him. In turn,
petitioner filed, on 14 March 1988, a motion for the reconsideration of the orders of 18
February 1988 and 02 March 1988 contending that: (a) the dismissal of the case was
tantamount to adjudication on the merits that thereby deprived it with the remedy to
enforce the promissory note, the chattel mortgage and the deed of assignment, under
Section 3, Rule 117, of the Rules of Court; (b) the order to return the vehicle to private
respondent was a departure from jurisprudence recognizing the right of the mortgagor
to foreclose the property to respond to the unpaid obligation secured by the chattel
mortgage, and (c) there were no legal and factual bases for the court’s view that the
filing of the replevin case was "characterized (by) evil practices." 15
On 20 April 1988, the court granted petitioner’s motion for reconsideration and
accordingly recalled the order directing the return of the vehicle to private respondent,
set aside the order dismissing the case, directed petitioner "to cause the service of
summons together with a copy of the complaint on the principal defendants within five
(5) days from receipt" 16 thereof at petitioners expense, and ordered private
respondent to answer the complaint.
A few months later, or on 02 August 1988, petitioner filed a motion to declare private
respondent in default. The court granted the motion on that same day and declared
private respondent "in default for his failure to file the . . . answer within the
reglementary period." 17 The court likewise granted petitioner’s motion to set the case
for the presentation, ex parte of evidence. Petitioner, thereupon, submitted the
promissory note, the deed of chattel mortgage, the deed of assignment, a statement of
account in the name of Florencia Manahan and two demand letters.
On 27 February 1989, the trial court rendered a decision dismissing the complaint
against the Manahans for failure of petitioner to prosecute the case against them. It
also dismissed the case against private respondent for failure of petitioner to show any
legal basis for said respondent’s liability. The court ratiocinated:
jgc:chanrobles.com.ph
". . . Roberto M. Reyes is merely ancillary debtor in this case. The defendant spouses
Manahan being the principal debtor(s) and as there is no showing that the latter has
been brought before the jurisdiction of this court, it must necessarily follow that the
plaintiff has no cause of action against said Roberto M. Reyes herein before referred to
as defendant John Doe. Under the circumstances, it is incumbent upon the plaintiff to
return the seized vehicle unto the said Roberto M. Reyes." 18
In its appeal to the Court of Appeals, petitioner has asserted that a suit for replevin
aimed at the foreclosure of the chattel is an action quasi in rem which does not
necessitate the presence of the principal obligors as long as the court does not render
any personal judgment against them. This argument did not persuade the appellate
court, the latter holding that —
". . . In action quasi in rem an individual is named as defendant and the purpose of the
proceeding is to subject his interest therein to the obligation or lien burdening the
property, such as proceedings having for their sole object the sale or disposition of the
property of the defendant, whether by attachment, foreclosure, or other form of
remedy (Sandejas v. Robles, 81 Phil. 421). In the case at bar, the court cannot render
any judgment binding on the defendants spouses for having allegedly violated the
terms and conditions of the promissory note and the contract of chattel mortgage on
the ground that the court has no jurisdiction over their persons, no summons having
been served on them. That judgment, it rendered, is void for having denied the
defendants spouses due process of law which contemplates notice and opportunity to
be heard before judgment is rendered, affecting one’s person or property (Macabingkil
v. Yatco, 26 SCRA 150. 157).
"It is next contended by appellant that as between appellant, as mortgagee, and John
Doe, whose right to possession is dubious if not totally non-existent, it is the former
which has the superior right of possession.
‘We cannot agree.
"It is an undisputed fact that the subject motor vehicle was taken from the possession
of said Roberto M. Reyes, a third person with respect to the contract of chattel
mortgage between the appellant and the defendants spouses Manahan.
"The Civil Code expressly provides that every possessor has a right to be respected in
his possession (Art. 539, New Civil Code); that good faith is always presumed, and
upon him who alleges bad faith on the part of a possessor rests the burden of proof
(Art. 527, ibid.); and that the possession of movable property acquired in good faith is
equivalent to a title; nevertheless, one who has lost any movable or has been
unlawfully deprived thereof, may recover it from the person in possession of the same
(Art. 559, ibid.). Thus, it has been held that a possessor in good faith is entitled to be
respected and protected in his possession as if he were the true owner thereof until a
competent court rules otherwise (Chus Hai v. Kapunan, 104 Phil. 110; Yu, Et. Al. v.
Hon. Honrado, etc., Et Al., 99 SCRA 237). In the case at bar, the trial court did not err
in holding that the complaint does not state any cause of action against Roberto M.
Reyes, and in ordering the return of the subject chattel to him." 19
The appellate court, subsequently, denied petitioner’s motion for reconsideration.
In the instant appeal, petitioner insists that a mortgagee can maintain an action for
replevin against any possessor of the object of a chattel mortgage even if the latter
were not a party to the mortgage.
Replevin, broadly understood, is both a form of principal remedy and of a provisional

relief. It may refer either to the action itself, i.e., to regain the possession of personal
chattels being wrongfully detained from the plaintiff by another, or to the provisional
remedy that would allow the plaintiff to retain the thing during the pendency of the
action and hold it pendente lite. 20 The action is primarily possessory in nature and
generally determines nothing more than the right of possession. Replevin is so usually
described as a mixed action, being partly in rem and partly in personam-in rem insofar
as the recovery of specific property is concerned, and in personam as regards to
damages involved. As an "action in rem, the gist of the replevin action is the right of
the plaintiff to obtain possession of specific personal property by reason of his being the
owner or of his having a special interest therein. 21 Consequently, the person in
possession of the property sought to be replevied is ordinarily the proper and only
necessary party defendant, and the plaintiff is not required to so join as defendants
other persons claiming a right on the property but not in possession thereof. Rule 60 of
the Rules of Court allows an application for the immediate possession of the property
but the plaintiff must show that he has a good legal basis, i.e., a clear title thereto, for
seeking such interim possession.
Where the right of the plaintiff to the possession of the specific property is so conceded
or evident, the action need only be maintained against him who so possesses the
property. In rem actio est per quam rem nostram quae ab alio possidetur petimus et
semper adversus eum est qui rem possidet. In Northern Motors, Inc. v. Herrera, 22 the
Court has said: jgc:chanrobles.com.ph
"There can be no question that persons having a special right of property in the goods
the recovery of which is sought, such as a chattel mortgagee, may maintain an action
for replevin therefor. Where the mortgage authorizes the mortgagee to take possession
of the property on default, he may maintain an action to recover possession of the
mortgaged chattels from the mortgagor or from any person in whose hands he may
find them." 23
In effect then, the mortgagee, upon the mortgagor’s default, is constituted an attorney-
in-fact of the mortgagor enabling such mortgagee to act for and in behalf of the owner.
Accordingly, that the defendant is not privy to the chattel mortgage should be
inconsequential. By the fact that the object of replevin is traced to his possession, one
properly can be a defendant in an action for replevin. It is here assumed that the
plaintiffs right to possess the thing is not or cannot be disputed.
In case the right of possession on the part of the plaintiff, or his authority to claim such
possession or that of his principal, is put to great doubt (a contending party might
contest the legal bases for plaintiffs cause of action or an adverse and independent
claim of ownership or right of possession is raised by that party), it could become
essential to have other persons involved and accordingly impleaded for a complete
determination and resolution of the controversy. For instance, in Servicewide
Specialists, Inc. v. Court of Appeals, Et Al., G.R. No. 103301, 08 December 1995 this
Court ruled:jgc:chanrobles.com.ph
"While, in its present petition for review on certiorari, Servicewide has raised a number
of points, the crucial issue still remains, however, to be whether or not an action filed
by the mortgagee for replevin to effect a foreclosure of the property covered by the
chattel mortgage would require that the mortgagor be so impleaded as an
indispensable party thereto.
"Rule 60 of the Rules of Court allows a plaintiff, in an action for the recovery of
possession of personal property, to apply for a writ of replevin if it can be shown that
he is the owner of the property claimed . . . or is entitled to the possession thereof.’
The plaintiff need not be the owner so long as he is able to specify his right to the
possession of the property and his legal basis therefor. The question then, insofar as
the matter finds relation to the instant case, is whether or not the plaintiff (herein
petitioner) who has predicated his right on being the mortgagee of a chattel mortgage
should implead the mortgagor in his complaint that seeks to recover possession of the
encumbered property in order to effect its foreclosure.
"The answer has to be in the affirmative. In a suit for replevin, a clear right of
possession must be established. A foreclosure under a chattel mortgage may properly
be commenced only once there is default on the part of the mortgagor of his obligation
secured by the mortgage. The replevin in the instant case has been sought to pave the
way for the foreclosure of the object covered by the chattel mortgage. The conditions
essential for that foreclosure would be to show, firstly, the existence of the chattel
mortgage and, secondly, the default of the mortgagor. These requirements must be
established since the validity of the plaintiff’s exercise of the right of foreclosure are
inevitably dependent thereon. It would thus seem, considering particularly an adverse
and independent claim of ownership by private respondent that the lower court acted
improvidently when it granted the dismissal of the complaint against Dollente, albeit on
petitioner’s (then plaintiff) plea, on the ground that the ‘non-service of summons upon
Ernesto Dollente (would) only delay the determination of the merits of the case, to the
prejudice of the parties.’ In Imson v. Court of Appeals, we have explained: jgc:chanrobles.com.ph
". . . An indispensable party is one whose interest will be affected by the court’s action
in the litigation, and without whom no final determination of the case can be had. The
party’s interest in the subject matter of the suit and in the relief sought are so
inextricably intertwined with the other parties’ that his legal presence as a party to the
proceeding is an absolute necessity. In his absence there cannot be a resolution of the
dispute of the parties before the court which is effective, complete, or equitable.
"Conversely, a party is not indispensable to the suit if his interest in the controversy or
subject matter is distinct and divisible from the interest of the other parties and will not
necessarily be prejudiced by a judgment which does complete justice to the parties in
court. He is not indispensable if his presence would merely permit complete relief
between him and those already parties to the action or will simply avoid multiple
litigation."
cralaw virtua1aw library
"Without the presence of indispensable parties to a suit or proceeding, a judgment of a

court cannot attain real finality" (Footnotes omitted.)
A chattel mortgagee, unlike a pledgee, need not be in, nor entitled to the possession of
the property unless and until the mortgagor defaults and the mortgagee thereupon
seeks to foreclose thereon. Since the mortgagee’s right of possession is conditioned
upon the actual fact of default which itself may be controverted, the inclusion of other
parties, like the debtor or the mortgagor himself, may be required in order to allow a
full and conclusive determination of the case. When the mortgagee seeks a replevin in
order to effect the eventual foreclosure of the mortgage, it is not only the existence of,
but also the mortgagor’s default on, the chattel mortgage that, among other things, can
properly uphold the right to replevy the property. The burden to establish a valid
justification for that action lies with the plaintiff. An adverse possessor, who is not the
mortgagor, cannot just be deprived of his possession, let alone be bound by the terms
of the chattel mortgage contract, simply because the mortgagee brings up an action for
replevin.
The appellate court, accordingly, acted well in arriving at its now questioned judgment.
WHEREFORE, the decision of the Court of Appeals is AFFIRMED. No costs.

Rule 1 Sec 5
BA FINANCE CORPORATION, Petitioner, v. HON. COURT OF APPEALS and
ROBERTO M. REYES, Respondents.
The case at bar is a suit for replevin and damages. The petition for review
on certiorari assails the decision of the Court of Appeals 1 in CA-G.R. CV No. 23605
affirming that of the Regional Trial Court of Manila, Branch XX, 2 which has disposed of
its Civil Case No. 87-42270 in this wise:jgc:chanrobles.com.ph
"WHEREFORE, the case against defendant-spouses (sic) Reynaldo Manahan is hereby

dismissed without prejudice, for failure to prosecute. Plaintiff having failed to show the
liability of defendant John Doe in the person of Roberto M. Reyes, the case against the
latter should likewise be dismissed. Moreover, plaintiff is hereby directed to return the
vehicle seized by virtue of the order of seizure issued by this Court with all its
accessories to the said Roberto M. Reyes." 3
The decisions of both the appellate court and the court a quo are based on a like finding
of the facts hereinafter briefly narrated.
The spouses Reynaldo and Florencia Manahan executed, on 15 May 1980, a promissory
note 4 binding themselves to pay Carmasters, Inc., the amount of P83,080.00 in thirty-
six monthly installments commencing 01 July 1980. To secure payment, the Manahan
spouses executed a deed of chattel mortgage 5 over a motor vehicle, a Ford Cortina 1.6
GL. with motor and serial number CUBFWE-801010. Carmasters later assigned 6 the
promissory note and the chattel mortgage to petitioner BA Finance Corporation with the
conformity of the Manahans. When the latter failed to pay the due installments,
petitioner sent demand letters. The demands not having been heeded, Petitioner, on 02
October 1987, filed a complaint for replevin with damages against the spouses, as well
as against a John Doe, praying for the recovery of the vehicle with an alternative prayer
for the payment of a sum of money should the vehicle not be returned. Upon
petitioner’s motion and the filing of a bond in the amount of P169, 161.00 the lower
court issued a writ of replevin. The court, however, cautioned petitioner that should
summons be not served on the defendants within thirty (30) days from the writ’s
issuance, the case would be dismissed to failure to prosecute. 7 The warning was based
on what the court perceived to be the deplorable practice of some mortgagees of
"freezing (the) foreclosure or replevin cases" which they would so "conveniently utilize
as a leverage for the collection of unpaid installments on mortgaged chattels." 8
The service of summons upon the spouses Manahan was caused to be served by
petitioner at No. 35 Lantana St., Cubao, Quezon City. The original of the summons had
the name and the signature of private respondent Roberto M. Reyes indicating that he
received, on 14 October 1987, a copy of the summons and the complaint. 9
Forthwith, Petitioner, through its Legal Assistant, Danilo E. Solano, issued a certification
to the effect that it had received from Orson R. Santiago, the deputy sheriff of the
Regional Trial Court of Manila, Branch 20, the Ford Cortina seized from private
respondent Roberto M. Reyes, the John Doe referred to in the complaint, 10 in
Sorsogon, Sorsogon. 11 On 20 October 19871 the lower court came out with an order
of seizure.
Alleging possession in good faith, private respondent filed, on 26 October 1987, a

motion for an extension of time within which to file his answer and/or a motion for
intervention. The court granted the motion.
A few months later, or on 18 February 1988, the court issued an order which, in part,
stated:jgc:chanrobles.com.ph
"Perusal of the record shows that an order for the seizure of personal property was
issued on October 20, 1987 in pursuance to a previous order of the Court dated
October 13, 1987. However, to date, there is no showing that the principal defendants
were served with summons inspite of the lapse of four (4) months.
"Considering, this is a replevin case and to forestall the evils that arise from this
practice, plaintiff failing to heed the Order dated October 13, 1987, particularly second
paragraph thereof, the above-entitled case is hereby ordered DISMISSED for failure to
prosecute and further ordering the plaintiff to return the property seized with all its
accessories to defendant John Doe in the person of Roberto M. Reyes.
"SO ORDERED." 12
On 26 February 1988, petitioner filed a notice of dismissal of the case "without

prejudice and without pronouncement as to costs, before service of Summons and
Answer, under Section 1, Rule 17, of the Rules of Court." 13 It also sought in another
motion the withdrawal of the replevin bond. In view of the earlier dismissal of the case
(for petitioner’s failure to prosecute), the court, on 02 March 1988, merely noted the
notice of dismissal and denied the motion to withdraw the replevin bond considering
that the writ of replevin had meanwhile been implemented. 14
On 09 March 1988, private respondent filed a motion praying that petitioner be directed
to comply with the court order requiring petitioner to return the vehicle to him. In turn,
petitioner filed, on 14 March 1988, a motion for the reconsideration of the orders of 18
February 1988 and 02 March 1988 contending that: (a) the dismissal of the case was
tantamount to adjudication on the merits that thereby deprived it with the remedy to
enforce the promissory note, the chattel mortgage and the deed of assignment, under
Section 3, Rule 117, of the Rules of Court; (b) the order to return the vehicle to private
respondent was a departure from jurisprudence recognizing the right of the mortgagor
to foreclose the property to respond to the unpaid obligation secured by the chattel
mortgage, and (c) there were no legal and factual bases for the court’s view that the
filing of the replevin case was "characterized (by) evil practices." 15
On 20 April 1988, the court granted petitioner’s motion for reconsideration and
accordingly recalled the order directing the return of the vehicle to private respondent,
set aside the order dismissing the case, directed petitioner "to cause the service of
summons together with a copy of the complaint on the principal defendants within five
(5) days from receipt" 16 thereof at petitioners expense, and ordered private
respondent to answer the complaint.
A few months later, or on 02 August 1988, petitioner filed a motion to declare private
respondent in default. The court granted the motion on that same day and declared
private respondent "in default for his failure to file the . . . answer within the
reglementary period." 17 The court likewise granted petitioner’s motion to set the case
for the presentation, ex parte of evidence. Petitioner, thereupon, submitted the
promissory note, the deed of chattel mortgage, the deed of assignment, a statement of
account in the name of Florencia Manahan and two demand letters.
On 27 February 1989, the trial court rendered a decision dismissing the complaint
against the Manahans for failure of petitioner to prosecute the case against them. It
also dismissed the case against private respondent for failure of petitioner to show any
legal basis for said respondent’s liability. The court ratiocinated: jgc:chanrobles.com.ph
". . . Roberto M. Reyes is merely ancillary debtor in this case. The defendant spouses
Manahan being the principal debtor(s) and as there is no showing that the latter has
been brought before the jurisdiction of this court, it must necessarily follow that the
plaintiff has no cause of action against said Roberto M. Reyes herein before referred to
as defendant John Doe. Under the circumstances, it is incumbent upon the plaintiff to
return the seized vehicle unto the said Roberto M. Reyes." 18
In its appeal to the Court of Appeals, petitioner has asserted that a suit for replevin
aimed at the foreclosure of the chattel is an action quasi in rem which does not
necessitate the presence of the principal obligors as long as the court does not render
any personal judgment against them. This argument did not persuade the appellate
court, the latter holding that —
". . . In action quasi in rem an individual is named as defendant and the purpose of the
proceeding is to subject his interest therein to the obligation or lien burdening the
property, such as proceedings having for their sole object the sale or disposition of the
property of the defendant, whether by attachment, foreclosure, or other form of
remedy (Sandejas v. Robles, 81 Phil. 421). In the case at bar, the court cannot render
any judgment binding on the defendants spouses for having allegedly violated the
terms and conditions of the promissory note and the contract of chattel mortgage on
the ground that the court has no jurisdiction over their persons, no summons having
been served on them. That judgment, it rendered, is void for having denied the
defendants spouses due process of law which contemplates notice and opportunity to
be heard before judgment is rendered, affecting one’s person or property (Macabingkil
v. Yatco, 26 SCRA 150. 157).
"It is next contended by appellant that as between appellant, as mortgagee, and John
Doe, whose right to possession is dubious if not totally non-existent, it is the former
which has the superior right of possession.
‘We cannot agree.
"It is an undisputed fact that the subject motor vehicle was taken from the possession
of said Roberto M. Reyes, a third person with respect to the contract of chattel
mortgage between the appellant and the defendants spouses Manahan.
"The Civil Code expressly provides that every possessor has a right to be respected in
his possession (Art. 539, New Civil Code); that good faith is always presumed, and
upon him who alleges bad faith on the part of a possessor rests the burden of proof
(Art. 527, ibid.); and that the possession of movable property acquired in good faith is
equivalent to a title; nevertheless, one who has lost any movable or has been
unlawfully deprived thereof, may recover it from the person in possession of the same
(Art. 559, ibid.). Thus, it has been held that a possessor in good faith is entitled to be
respected and protected in his possession as if he were the true owner thereof until a
competent court rules otherwise (Chus Hai v. Kapunan, 104 Phil. 110; Yu, Et. Al. v.
Hon. Honrado, etc., Et Al., 99 SCRA 237). In the case at bar, the trial court did not err
in holding that the complaint does not state any cause of action against Roberto M.
Reyes, and in ordering the return of the subject chattel to him." 19
The appellate court, subsequently, denied petitioner’s motion for reconsideration.
In the instant appeal, petitioner insists that a mortgagee can maintain an action for
replevin against any possessor of the object of a chattel mortgage even if the latter
were not a party to the mortgage.
Replevin, broadly understood, is both a form of principal remedy and of a provisional

relief. It may refer either to the action itself, i.e., to regain the possession of personal
chattels being wrongfully detained from the plaintiff by another, or to the provisional
remedy that would allow the plaintiff to retain the thing during the pendency of the
action and hold it pendente lite. 20 The action is primarily possessory in nature and
generally determines nothing more than the right of possession. Replevin is so usually
described as a mixed action, being partly in rem and partly in personam-in rem insofar
as the recovery of specific property is concerned, and in personam as regards to
damages involved. As an "action in rem, the gist of the replevin action is the right of
the plaintiff to obtain possession of specific personal property by reason of his being the
owner or of his having a special interest therein. 21 Consequently, the person in
possession of the property sought to be replevied is ordinarily the proper and only
necessary party defendant, and the plaintiff is not required to so join as defendants
other persons claiming a right on the property but not in possession thereof. Rule 60 of
the Rules of Court allows an application for the immediate possession of the property
but the plaintiff must show that he has a good legal basis, i.e., a clear title thereto, for
seeking such interim possession.
Where the right of the plaintiff to the possession of the specific property is so conceded
or evident, the action need only be maintained against him who so possesses the
property. In rem actio est per quam rem nostram quae ab alio possidetur petimus et
semper adversus eum est qui rem possidet. In Northern Motors, Inc. v. Herrera, 22 the
Court has said: jgc:chanrobles.com.ph
"There can be no question that persons having a special right of property in the goods
the recovery of which is sought, such as a chattel mortgagee, may maintain an action
for replevin therefor. Where the mortgage authorizes the mortgagee to take possession
of the property on default, he may maintain an action to recover possession of the
mortgaged chattels from the mortgagor or from any person in whose hands he may
find them." 23
In effect then, the mortgagee, upon the mortgagor’s default, is constituted an attorney-
in-fact of the mortgagor enabling such mortgagee to act for and in behalf of the owner.
Accordingly, that the defendant is not privy to the chattel mortgage should be
inconsequential. By the fact that the object of replevin is traced to his possession, one
properly can be a defendant in an action for replevin. It is here assumed that the
plaintiffs right to possess the thing is not or cannot be disputed.
In case the right of possession on the part of the plaintiff, or his authority to claim such
possession or that of his principal, is put to great doubt (a contending party might
contest the legal bases for plaintiffs cause of action or an adverse and independent
claim of ownership or right of possession is raised by that party), it could become
essential to have other persons involved and accordingly impleaded for a complete
determination and resolution of the controversy. For instance, in Servicewide
Specialists, Inc. v. Court of Appeals, Et Al., G.R. No. 103301, 08 December 1995 this
Court ruled:jgc:chanrobles.com.ph
"While, in its present petition for review on certiorari, Servicewide has raised a number
of points, the crucial issue still remains, however, to be whether or not an action filed
by the mortgagee for replevin to effect a foreclosure of the property covered by the
chattel mortgage would require that the mortgagor be so impleaded as an
indispensable party thereto.
"Rule 60 of the Rules of Court allows a plaintiff, in an action for the recovery of
possession of personal property, to apply for a writ of replevin if it can be shown that
he is the owner of the property claimed . . . or is entitled to the possession thereof.’
The plaintiff need not be the owner so long as he is able to specify his right to the
possession of the property and his legal basis therefor. The question then, insofar as
the matter finds relation to the instant case, is whether or not the plaintiff (herein
petitioner) who has predicated his right on being the mortgagee of a chattel mortgage
should implead the mortgagor in his complaint that seeks to recover possession of the
encumbered property in order to effect its foreclosure.
"The answer has to be in the affirmative. In a suit for replevin, a clear right of
possession must be established. A foreclosure under a chattel mortgage may properly
be commenced only once there is default on the part of the mortgagor of his obligation
secured by the mortgage. The replevin in the instant case has been sought to pave the
way for the foreclosure of the object covered by the chattel mortgage. The conditions
essential for that foreclosure would be to show, firstly, the existence of the chattel
mortgage and, secondly, the default of the mortgagor. These requirements must be
established since the validity of the plaintiff’s exercise of the right of foreclosure are
inevitably dependent thereon. It would thus seem, considering particularly an adverse
and independent claim of ownership by private respondent that the lower court acted
improvidently when it granted the dismissal of the complaint against Dollente, albeit on
petitioner’s (then plaintiff) plea, on the ground that the ‘non-service of summons upon
Ernesto Dollente (would) only delay the determination of the merits of the case, to the
prejudice of the parties.’ In Imson v. Court of Appeals, we have explained: jgc:chanrobles.com.ph
". . . An indispensable party is one whose interest will be affected by the court’s action
in the litigation, and without whom no final determination of the case can be had. The
party’s interest in the subject matter of the suit and in the relief sought are so
inextricably intertwined with the other parties’ that his legal presence as a party to the
proceeding is an absolute necessity. In his absence there cannot be a resolution of the
dispute of the parties before the court which is effective, complete, or equitable.
"Conversely, a party is not indispensable to the suit if his interest in the controversy or
subject matter is distinct and divisible from the interest of the other parties and will not
necessarily be prejudiced by a judgment which does complete justice to the parties in
court. He is not indispensable if his presence would merely permit complete relief
between him and those already parties to the action or will simply avoid multiple
litigation."
cralaw virtua1aw library
"Without the presence of indispensable parties to a suit or proceeding, a judgment of a

court cannot attain real finality" (Footnotes omitted.)
A chattel mortgagee, unlike a pledgee, need not be in, nor entitled to the possession of
the property unless and until the mortgagor defaults and the mortgagee thereupon
seeks to foreclose thereon. Since the mortgagee’s right of possession is conditioned
upon the actual fact of default which itself may be controverted, the inclusion of other
parties, like the debtor or the mortgagor himself, may be required in order to allow a
full and conclusive determination of the case. When the mortgagee seeks a replevin in
order to effect the eventual foreclosure of the mortgage, it is not only the existence of,
but also the mortgagor’s default on, the chattel mortgage that, among other things, can
properly uphold the right to replevy the property. The burden to establish a valid
justification for that action lies with the plaintiff. An adverse possessor, who is not the
mortgagor, cannot just be deprived of his possession, let alone be bound by the terms
of the chattel mortgage contract, simply because the mortgagee brings up an action for
replevin.
The appellate court, accordingly, acted well in arriving at its now questioned judgment.
WHEREFORE, the decision of the Court of Appeals is AFFIRMED. No costs.
SO ORDERED.
RAMON SOTELO, Petitioner, v. ARSENIO P. DIZON, Judge of First Instance of

Manila, L. PASICOLAN, Sheriff of the City of Manila, and HARRIE S.
EVERETT, Respondents.
Jose Sotelo for Petitioner.
Duran & Lim for Respondents.
SYLLABUS
1. CIVIL ACTIONS; WHEN ACTIONS DEEMED COMMENCED; INTERPRETATION OF

SECTION 389 OF THE CODE OF CIVIL PROCEDURE. — Under section 389, a civil action
is deemed legally commenced from the date of the filing and docketing of the complaint
with the clerk of Court of First Instance, without taking into account the issuance and
service of the summons. Section 389 of the Code of Civil Procedure is taken from
section 405 of the California Code of Civil Procedure, and the Supreme Court of said
State has so interpreted it in Tinn v. United States District Attorney (148 Cal., 773);
Dowling v. Comerford (99 Cal., 204); Ex parte Fil Ki (79 Cal., 584); and Nash v. El
Dorado County (24 Fed., 252; 1 C. J., sec. 403, PP. 1150 1156).
2. ID.; JURISDICTION; PRELIMINARY INJUNCTION; DAMAGES. — Under the facts the

respondent judge had jurisdiction to issue the orders of January 3 and 5, 1939, and he
did not exceed the same or the discretion conferred upon him by law in such cases.
From the same facts it follows that the preliminary injunction obtained by the petitioner
in these proceedings was issued without just cause, wherefore, the petitioner is
answerable for damages which he might have caused the respondent E.
This petition for certiorari assails the legality of the order issued by the respondent
judge on January 5, 1939, directing the sheriff or any of his agents to execute the order
of the 3d of said month appointing R. Marino Corpus receiver, by placing him in
possession of the cinematograph business established in the Savoy Theatre, together
with its equipment and existing funds.
On July 22, 1938, the respondent Harrie S. Everett brought civil case No. 53411 in the
Court of First Instance of Manila against Lazarus Joseph, to recover the ownership and
possession of the cinematograph business established in the Fox and Savoy theatres,
with its equipment and existing funds. The respondent asked in his complaint that a
writ of preliminary injunction be issued. As the then defendant alleged that the
cinematograph business had been transferred by him to the partnership Joseph
Brothers, the respondent Everett amended his complaint by including as defendants the
said partnership and its partners, John Joseph and George Joseph. Everett dropped out
his prayer for preliminary injunction and in his amended complaint asked that R. Marino
Corpus be appointed receiver to take charge of the properties in litigation during the
pendency of the case. On December 16, 1938 the court appointed R. Marino Corpus
receiver of the cinematograph business known as Savoy as well as all its equipment
and existing funds, ordering him to take possession thereof and administer them in
accordance with law after having qualified and filed a bond for P2,000. When the
receiver tried to take possession oœ the properties entrusted to him, he was met by the
petitioner’s allegation that he is the owner thereof by purchase from Joseph Brothers on
December 15, 1938. In view of this and of the fact that the petitioner had refused to
deliver the properties, Everett filed a supplementary complaint on December 23, 1938
including the petitioner as defendant and asking that the order of December 16th
appointing a receiver be confirmed. On January 3, 1939 the respondent judge issued an
order allowing the supplementary complaint and at the same time reiterating the order
of December 16, 1938 appointing a receiver. On the 4th of the same month the
receiver looked for the petitioner to require him to give up the properties under
receivership, but he was unable to locate him either in his office or in his house as he
was informed that the petitioner was sick in the province. On the same date, January 4,
1939, Everett filed a motion asking that the court order the sheriff or his agent to place
the receiver in possession of the properties. On the 5th of the said month, the court
favorably acted upon the motion, and on the following day, January 6th, the deputy
sheriff went to the Savoy Theatre to make delivery thereof to the receiver, but the
petitioner refused to make delivery and forthwith filed this petition. The petitioner was
served with the supplementary complaint in the morning of January 6, 1939 and when
he filed the petition for certiorari in this case he had already been duly summoned. In
the same morning of January 6, 1939 and before his petition for certiorari was filed, the
petitioner was likewise notified of the order of the respondent judge issued on the 5th
of the said month directing the sheriff to place the properties in the receiver’s
possession.
The petitioner contends that the order of January 5, 1939, providing for the execution
of the other order of the 3d of the same month and for the placing of the properties in
the possession of the receiver, is illegal because on said date there was yet no pending
action against him and because he was not duly served with the supplementary
complaint, citing in his support sections 173 and 389 of the Code of Civil Procedure
reading as follows:jgc:chanrobles.com.ph
"SEC. 173. Receivers, who may appoint. — A judge of the Supreme Court, or a judge of
the Court of First Instance in which the action is pending, may appoint one or more
receivers of the property, real, personal, or mixed, which is the subject of the action, in
the manner and under the conditions hereinafter provided." cralaw virtua1aw library
"SEC. 389. Commencement of actions. — Civil actions must be commenced by filing a

complaint with the clerk of the court in which the action is to be instituted. The date of
the filing of the complaint upon which process is issued and duly served shall be
deemed to be the true time of the commencement of the action." cralaw virtua1aw library
The first contention is not justified by the facts because it appears that the
supplementary complaint had been admitted by the court on January 3, 1939, hence,
when the order of the 6th of said month was issued directing the sheriff to place the
receiver in possession of the properties, there was already an action in court against
the petitioner.
As to the second legal question before us, the petitioner argues that he was not yet
duly served with the supplementary complaint when the order of January 5, 1939 was
issued, because the summons only took place on the 6th of the said month, and under
section 389 no action in court was yet pending against him. We find no merit in this
contention. Under section 389, a civil action is deemed legally commenced from the
date of the filing and docketing of the complaint with the clerk of Court of First
Instance, without taking into account the issuance and service of the summons. Section
389 of the Code of Civil Procedure is taken from section 405 of the California Code of
Civil Procedure, and the Supreme Court of said State has 80 interpreted it in Tinn v.
United States District Attorney (14 Cal., 773); Dowling v. Comerford (99 Cal., 204); Ex
parte Fil Ki (79 Cal., 584); and Nash v. El Dorado County (2 Fed. 252; 1 C. J., sec. 403,
pp. 1155, 1156).
Under the facts the respondent judge had jurisdiction to issue the orders of January 3
and 5, 1939, and he did not exceed the same or the discretion conferred upon him by
law in such cases. From the same facts it follows that the preliminary injunction
obtained by the petitioner in these proceedings was issued without just cause,
wherefore, the petitioner is answerable for damages which he might have caused the
respondent Everett. We reserve to the latter the right to claim and substantiate said
damages in the Court of First Instance where the principal cause is pending, upon
petition which he may present for that purpose.
For the foregoing reasons, the remedy prayed for is denied, with the costs to the
petitioner. The preliminary injunction issued in this case is set aside. So ordered.
PHILIPPINE FIRST INSURANCE CO., INC. and PARAMOUNT GENERAL

INSURANCE CORPORATION, Petitioners, v. PYRAMID LOGISTICS AND TRUCKING
CORPORATION (formerly PANACOR INTEGRATED WAREHOUSING AND
TRUCKING CORPORATION), Respondent.
The issue, in the main, in the present case is whether respondent, Pyramid Logistics
and Trucking Corporation (Pyramid), which filed on November 7, 2001 a
complaint,1 denominated as one for specific performance and damages, against
petitioners Philippine First Insurance Company, Inc. (Philippine First) and Paramount
General Insurance Corporation (Paramount) before the Regional Trial Court (RTC) of
Makati, docketed as Civil Case No. 01-1609, paid the correct docket fee; if in the
negative, whether the complaint should be dismissed or Pyramid can still be ordered to
pay the fee.
Pyramid sought to recover the proceeds of two insurance policies issued to it, Policy No.
IN-002904 issued by petitioner Paramount, and Policy No. MN-MCL-HO-00-0000007-00
issued by petitioner Philippine First. Despite demands, petitioners allegedly failed to
settle them, hence, it filed the complaint subject of the present petition.
In its complaint, Pyramid alleged that on November 8, 2000, its delivery van bearing
license plate number PHL-545 which was loaded with goods belonging to California
Manufacturing Corporation (CMC) valued at PESOS NINE HUNDRED SEVEN THOUSAND
ONE HUNDRED FORTY NINE AND SEVEN/100 (P907,149.07) left the CMC Bicutan
Warehouse but the van, together with the goods, failed to reach its destination and its
driver and helper were nowhere to be found, to its damage and prejudice; that it filed a
criminal complaint against the driver and the helper for qualified theft, and a claim with
herein petitioners as co-insurers of the lost goods but, in violation of petitioners'
undertaking under the insurance policies, they refused without just and valid reasons to
compensate it for the loss; and that as a direct consequence of petitioners' failure,
despite repeated demands, to comply with their respective undertakings under the
Insurance Policies by compensating for the value of the lost goods, it suffered damages
and was constrained to engage the services of counsel to enforce and protect its right
to recover compensation under said policies, for which services it obligated itself to pay
the sum equivalent to twenty-five (25%) of any amount recovered as and for attorney's
fees and legal expenses.2
Pyramid thus prayed
. . . that after due proceedings, judgment be rendered, ordering [herein petitioners] to

comply with their obligation under their respective Insurance Policies by paying to [it]
jointly and severally, the claims arising from the subject losses.
THAT, [herein petitioners] be adjudged jointly and severally to pay to [it], in addition to
the foregoing, the following:
1. The sum of PHP 50,000.00 plus PHP 1,500.00 for each Court session attended by
counsel until the instant [case] is finally terminated, as and for attorney's fees;
2. The costs of suit[;]3 (Underscoring supplied) cralawlibrary
and for other reliefs just and equitable in the premises. 4
Pyramid was assessed P610 docket fee, apparently on the basis of the amount
of P50,000 specified in the prayer representing attorney's fees, which it duly paid. 5
Pyramid later filed a 1st Amended Complaint 6 containing minor changes in its body7 but
bearing the same prayer.8 Branch 148 of the Makati RTC to which the complaint was
raffled admitted the Amended Complaint. 9
Petitioners filed a Motion to Dismiss on the ground of, inter alia, lack of jurisdiction,
Pyramid not having paid the docket fees in full, arguing thus:
xxx
In the body of the Amended Complaint, plaintiff alleged that the goods belonging to
California Manufacturing Co., Inc. (CMC) is [sic] "valued at Php907,149.07" and
consequently, "plaintiff incurred expenses, suffered damages and was constrained to
engage the services of counsel to enforce and protect its right to recover compensation
under the said policies and for which services, it obligated itself to pay the sum
equivalent to twenty-five (25%) of any recovery in the instant action, as and for
attorney's fees and legal expenses".
On the other hand, in the prayer in the Complaint, plaintiff deliberately omitted to
specify what these damages are. x x x
xxx
Verily, this deliberate omission by the plaintiff is clearly intended for no other purposes
than to evade the payment of the correct filing fee if not to mislead the docket clerk, in
the assessment of the filing fee. In fact, the docket clerk in the instant case charged the
plaintiff a total of Php610.00 only as a filing fee, which she must have based on the
amount of Php50,000.00 [attorney's fees] only.10 (Emphasis in the original; italics and
underscoring supplied)
Petitioners cited11 Manchester Development Corporation v. Court of Appeals 12 which

held:
x x x [A]ll complaints, petitions, answers and other similar pleadings should specify the
amount of damages being prayed for not only in the body of the pleading but also in
the prayer, and said damages shall be considered in the assessment of the filing fees in
any case. Any pleading that fails to comply with this requirement shall not be accepted
or admitted, or shall otherwise be expunged from the record. 13 (Emphasis and
underscoring supplied) cralawlibrary
They cited too Sun Insurance Office, Ltd. v. Asuncion14 which held that "[i]t is not
simply the filing of the complaint or appropriate pleading, but the payment of the
prescribed docket fee, that vests a trial court with jurisdiction over the subject-matter
or nature of the action."15
Petitioners thus concluded:
With the above cases as a backdrop, the Supreme Court, in revising the rules of
pleading and practice in the 1997 Rules of Civil Procedure, added a tenth ground to a
Motion to Dismiss - to wit, "[t]hat a condition precedent for filing claim [sic] has not
been complied with.["]
On the contrary, if plaintiff would insist that its claim against the defendants is only
Php50,000.00 plus Php 1,500.00 as appearance fee per court hearing, then it follows
that it is the Metropolitan Trial Court which has jurisdiction over this case, not this
Honorable Court. Such amount is way below the minimum jurisdictional amount
prescribed by the rules in order to confer jurisdiction to the Regional Trial
Court.16 (Underscoring supplied) cralawlibrary
To the Motion to Dismiss Pyramid filed its Opposition, 17 alleging that if there was a
mistake in the assessment of the docket fees, the trial court was not precluded from
acquiring jurisdiction over the complaint as "it has the authority to direct the mistaken
party to complete the docket fees in the course of the proceedings . . ."18 The
Opposition merited a Reply19 from petitioners.
By Order of June 3, 2002, the trial court20 denied the Motion to Dismiss in this wise:
xxx
Indeed, a perusal of the Complaint reveals that while plaintiff made mention of the
value of the goods, which were lost, the prayer of plaintiff did not indicate its exact
claim from the defendants. The Complaint merely prayed defendants "to comply with
their obligation under their respective insurance policies by paying to plaintiff jointly
and severally, the claims arising from the subject losses" and did not mention the
amount of PHP907,149.07, which is the value of the goods and which is also the subject
of insurance. This resulted to the assessment and payment of docket fees in the
amount of P610 only. The Court, even without the Motion to Dismiss filed by defendant,
actually noted such omission which is actually becoming a practice for some lawyers.
For whatever purpose it may be, the Court will not dwell into it. In this instant
case, this being for specific performance, it is not dismissible on that ground but unless
proper docket fees are paid, the Court can only grant what was prayed for in the
Complaint.
x x x x21 (Emphasis and underscoring supplied) cralawlibrary
Petitioners' Motion for Reconsideration22 of the denial of their Motion to Dismiss having
been denied23 by Order of August 1, 2002, they filed their Answer with Compulsory
Counterclaim ad Cautelam,24 alleging that they intended to file a Petition
for Certiorari with the Court of Appeals.25
Petitioners did indeed eventually file before the Court of Appeals a Petition
for Certiorari (With Preliminary Injunction and Urgent Prayer for Restraining
Order)26 posing the following two of three queries, viz:
First. Does [Pyramid's] deliberate omission to pay the required correct docket and filing
fee vest the trial court [with] jurisdiction to entertain the subject matter of the instant
case?cralawred
Second. [Is] the instant case an action for specific performance or simply one for
damages or recovery of a sum of money?
x x x x27
By Decision of June 3, 2004,28 the Court of Appeals partially granted petitioners'

petition for certiorari by setting aside the trial judge's assailed orders and ordering
Pyramid to file the correct docket fees within a reasonable time, it holding that while
the complaint was denominated as one for specific performance, it sought to recover
from petitioners Pyramid's "claims arising from the subject losses." The appellate court
ratiocinated:
xxx
Indeed, it has been held that "it is not simply the filing of the complaint or appropriate
initiatory pleading, but the payment of the prescribed docket fee that vests a trial court
with jurisdiction over the subject matter or nature of the action." To determine the
docket fees, it is necessary to determine the true nature of the action by examining the
allegations of the complaint. x x x
xxx
While the captions of the complaint and 1st amended complaint denominated the case
as one for "Specific Performance and Damages", the allegations and prayer therein
show that the specific performance sought by private respondent was for petitioners to
"comply with their obligation under their respective Insurance Policies by paying to
plaintiff jointly and severally, the claims arising from the subject losses" as well as the
attorney's fees and costs of suit. Obviously, what constitutes specific performance is the
payment itself by petitioners of private respondent's claims arising from the losses it
allegedly incurred. x x x29
xxx
Public respondent should have ordered private respondent to pay the correct docket
fees on the basis of the allegations of the complaint. x x x
xxx
While it has been held in Manchester Development Corporation v. Court of Appeals x x

x that "any pleading that fails to comply with this requirement of specifying the amount
of damages not only in the body of the pleading but also in the prayer shall not be
accepted nor admitted, or shall otherwise be expunged from the record," this rule
was relaxed in subsequent cases, wherein payment of the correct docket fees was
allowed within a reasonable time. . .
x x x x30 (Emphasis and underscoring supplied) cralawlibrary

Thus the appellate court disposed:
WHEREFORE, the petition is partially granted. The Orders dated June 3, 2002 and
August 1, 2002 of public respondent are partially set aside insofar as they dispensed
with the payment of the correct docket fees. Consequently, [Pyramid] is hereby
directed to pay the correct docket fees on the basis of the losses alleged in the body of
the complaint, plus the attorney's fees mentioned in the prayer, within a reasonable
time which should not go beyond the applicable prescriptive or reglementary period. In
all other respects, the said Orders are affirmed. 31 (Underscoring supplied)cralawlibrary
Petitioners filed a Motion for Reconsideration32 of the appellate court's decision. Pyramid
filed its Comment and Opposition to the Motion for Reconsideration, 33 arguing thus:
xxx
In the present case, [Pyramid] thru its Complaint simply sought from petitioners
compliance with their contractual undertaking as insurers of the goods insured which
were lost in [its] custody. Private respondent did not specify the extent of petitioners'
obligation as it left the matter entirely in the judgment of the trial court to consider.
Thus, the Complaint was labeled "Specific Performance" which [Pyramid] submitted to
the Clerk of Court for assessment of the docket fee, after which, it paid the same based
on the said assessment. There was no indication whatsoever that [Pyramid] had
refused to pay; rather, it merely argued against petitioners' submissions as it
maintained the correctness of the assessment made. 34 (Underscoring supplied) cralawlibrary
By Resolution of August 23, 2004, the Court of Appeals denied petitioners' Motion for
Reconsideration;35 hence, the present Petition for Review on Certiorari, 36 raising the
issues of whether the appellate court erred:
. . . WHEN IT APPLIED IN THE INSTANT CASE THE LIBERAL RULE ENUNCIATED IN SUN
INSURANCE OFFICE, LTD. (SIOL) v. ASUNCION, 170 SCRA 274 AND NATIONAL STEEL
CORPORATION v. COURT OF APPEALS, 302 SCRA 523 (1999) IN RESPECT TO THE
PAYMENT OF THE PRESCRIBED FILING AND DOCKET FEES DESPITE CLEAR SHOWING
OF RESPONDENT'S INTENTION TO EVADE THE PAYMENT OF THE CORRECT DOCKET
FEE WHICH WARRANTS THE APPLICATION OF THE DOCTRINE LAID DOWN
IN MANCHESTER DEVELOPMENT CORPORATION VS. COURT OF APPEALS, 149 SCRA
562.
. . . WHEN IT DID NOT APPLY THE RULING OF THIS HONORABLE TRIBUNAL IN
MARCOPPER MINING CORPORATION v. GARCIA, 143 SCRA 178, TAN v. DIRECTOR OF
FORESTRY, 125 SCRA 302, AND CHINA ROAD AND BRIDGE CORPORATION v. COURT
OF APPEALS, 348 SCRA 401.37 (Underscoring supplied) cralawlibrary
Petitioners invoke the doctrine in Manchester Development Corporation v. Court of

Appeals38 that a pleading which does not specify in the prayer the amount sought shall
not be admitted or shall otherwise be expunged, and that the court acquires jurisdiction
only upon the payment of the prescribed docket fee.39
Pyramid, on the other hand, insists, in its Comment on the Petition, 40 on the application
of Sun Insurance Office, Ltd. (SIOL) v. Asuncion 41 and subsequent rulings relaxing the
Manchester ruling by allowing payment of the docket fee within a reasonable time, in
no case beyond the applicable prescriptive or reglementary period, where the filing of
the initiatory pleading is not accompanied by the payment of the prescribed docket
fee.42
In Tacay v. Regional Trial Court of Tagum, Davao del Norte, 43 the Court clarified the
effect of the Sun Insurance ruling on the Manchester ruling as follows:
As will be noted, the requirement in Circular No. 7 [of this Court which was issued
based on the Manchester ruling44] that complaints, petitions, answers, and similar
pleadings should specify the amount of damages being prayed for not only in the body
of the pleading but also in the prayer, has not been altered. What has been revised is
the rule that subsequent "amendment of the complaint or similar pleading will not
thereby vest jurisdiction in the Court, much less the payment of the docket fee based
on the amount sought in the amended pleading," the trial court now being authorized to
allow payment of the fee within a reasonable time but in no case beyond the applicable
prescriptive period or reglementary period. Moreover, a new rule has been added,
governing the awards of claims not specified in the pleading - i.e., damages arising
after the filing of the complaint or similar pleading - as to which the additional filing fee
therefore shall constitute a lien on the judgment.
Now, under the Rules of Court, docket or filing fees are assessed on the basis of the
"sum claimed," on the one hand, or the "value of the property in litigation or the value
of the estate," on the other. . .
Where the action is purely for the recovery of money or damages, the docket fees are
assessed on the basis of the aggregate amount claimed, exclusive only of interests and
costs. In this case, the complaint or similar pleading should, according to Circular No. 7
of this Court, "specify the amount of damages being prayed for not only in the body of
the pleading but also in the prayer, and said damages shall be considered in the
assessment of filing fees in any case."
Two situations may arise. One is where the complaint or similar pleading sets out a
claim purely for money and damages and there is no statement of the amounts being
claimed. In this event the rule is that the pleading will "not be accepted nor admitted,
or shall otherwise be expunged from the record." In other words, the complaint or
pleading may be dismissed, or the claims as to which amounts are unspecified may be
expunged, although as aforestated the Court may, on motion, permit amendment of
the complaint and payment of the fees provided the claim has not in the meantime
become time-barred. The other is where the pleading does specify the amount of every
claim, but the fees paid are insufficient; and here again, the rule now is that the court
may allow a reasonable time for the payment of the prescribed fees, or the balance
thereof, and upon such payment, the defect is cured and the court may properly take
cognizance of the action, unless in the meantime prescription has set in and
consequently barred the right of action.45 (Emphasis and underscoring supplied) cralawlibrary
Indeed, Pyramid captioned its complaint as one for "specific performance and damages"
even if it was, as the allegations in its body showed, seeking in the main the collection
of its claims-sums of money representing losses the amount of which it, by its own
admission, "knew."46 And, indeed, it failed to specify in its prayer in the complaint the
amount of its claims/damages.
When Pyramid amended its complaint, it still did not specify, in its prayer, the amount
of claims/damages it was seeking. In fact it has the audacity to inform this Court, in its
Comment on the present Petition, that
x x x In the natural order of things, when a litigant is given the opportunity to spend
less for a docket fee after submitting his pleading for assessment by the Office of the
Clerk of Court, he would not decline it inasmuch as to request for a higher assessment
under the circumstances [for such] is against his interest and would be senseless.
Placed under the same situation, petitioner[s] would certainly do likewise. To say
otherwise would certainly be dishonest,47
which comment drew petitioners to conclude as follows:
[This] only shows respondent's dishonesty and lack of regard of the rules. Following this
line of reasoning, respondent would do everything if only for it to spend less for the
filing fee, even to the extent of circumventing and defying the rule on the payment of
the filing fee.
In spite of the fact that the respondent was already caught in the quagmire of its own
cobweb of deception, it further justified its unethical act by ratiocinating that "placed
under the same situation, petitioner would certainly do likewise, to say otherwise would
certainly be dishonest". This attitude of the respondent is very alarming! Having been
caught red-handed, the honorable thing that respondent should have done is admit its
own violation rather than justify an act which it knows is a clear contravention of the
rules and jurisprudence.48 (Italics and emphasis in the original)
Pyramid's following justification for omitting to specify in the prayer of its complaint the
amount of its claims/damages, viz:
xxx
x x x While respondent knew its losses and alleged them in the body of the Complaint,
it was not aware of the extent of petitioners' respective liability under the two
insurance policies. The allegation of respondent's losses, albeit, without repeating them
in its prayer for relief was not motivated by an intention to mislead, cheat or defraud
the Court. It just left the matter of liability arising from two separate and distinct
Insurance Policies covering the same insurable risk for the trial court's determination,
hence, respondent came up with an action for "specific performance[,]" 49 (Emphasis
and underscoring supplied) cralawlibrary
fails to impress.
As the salient allegations of Pyramid's complaint show and as priorly stated, they
constitute, in the main, an action for collection of its claims it admittedly "knew."
Assuming arguendo that Pyramid has other claims the amounts of which are yet to be
determined by the trial court, the rule established in Manchester which was embodied
in this Court's Circular No. 7-88 issued on March 24, 1988, as modified by the Sun
Insurance ruling, still applies. Consider this Court's pronouncement bearing on the
matter in Ayala Corporation v. Madayag: 50 Ï‚Î·Î±Ã±rÎ¿blÎµÅ¡ Î½Î¹râ€ Ï…Î±l lÎ±Ï‰ lÎ¹brÎ±rÃ¿
xxx
Apparently, the trial court misinterpreted paragraph 3 of the [Sun Insurance] ruling of
this Court wherein it stated that "where the judgment awards a claim not specified in
the pleading, or if specified, the same has been left for the determination of the
court, the additional filing fee therefor shall constitute a lien on the judgment" by
considering it to mean that where in the body and prayer of the complaint there is a
prayer xxx the amount of which is left to the discretion of the Court, there is no need to
specify the amount being sought, and that any award thereafter shall constitute a lien
on the judgment.
x x x While it is true that the determination of certain damages x x x is left to the sound
discretion of the court, it is the duty of the parties claiming such damages to
specify the amount sought on the basis of which the court may make a proper
determination, and for the proper assessment of the appropriate docket fees.
The exception contemplated as to claims not specified or to claims although specified
are left for determination of the court is limited only to any damages that may
arise after the filing of the complaint or similar pleading for then it will not be possible
for the claimant to specify nor speculate as to the amount thereof. (Emphasis and
underscoring supplied) cralawlibrary
If respondent Pyramid's counsel had only been forthright in drafting the complaint and
taking the cudgels for his client and the trial judge assiduous in applying Circular No. 7
vis a vis prevailing jurisprudence, the precious time of this Court, as well as of that of
the appellate court, would not have been unnecessarily sapped.
The Court at this juncture thus reminds Pyramid's counsel to observe Canon 12 of the
Code of Professional Ethics which enjoins a lawyer to "exert every effort and consider it
his duty to assist in the speedy and efficient administration of justice," and Rule 12.04
of the same Canon which enjoins a lawyer "not [to] unduly delay a case, impede the
execution of a judgment or misuse court processes." And the Court reminds too the
trial judge to bear in mind that the nature of an action is determined by the allegations
of the pleadings51 and to keep abreast of all laws and prevailing jurisprudence,
consistent with the standard that magistrates must be the embodiments of
competence, integrity and independence.52
WHEREFORE, in light of the foregoing discussions, the petition is DENIED.
SO ORDERED.
Rule 1 Sec 6
G.R. No. 187021 January 25, 2012
DOUGLAS F. ANAMA, Petitioner,
vs.
PHILIPPINE SAVINGS BANK, SPOUSES SATURNINA BARIA &TOMAS CO and THE
REGISTER OF DEEDS, METRO MANILA, DISTRICT II, Respondents.
This is a petition for review under Rule 45 assailing the March 31, 2008 Decision of the Court of
1
Appeals (CA) and its February 27, 2009 Resolution, in CA G.R. No. SP-94771, which affirmed the
2
November 25, 2005 Order of the Regional Trial Court, Branch 167, Pasig City (RTC), granting the
motion for issuance of a writ of execution of respondents.
The Facts
The factual and procedural backgrounds of this case were succinctly recited by the CA in its decision
as follows:
Sometime in 1973, the Petitioner, Douglas F. Anama (Anama), and the Respondent, Philippine
Savings Bank (PSB), entered into a "Contract to Buy," on installment basis, the real property owned
and covered by Transfer Certificate of Title (TCT) No. 301276 in the latter’s name. However, Anama
defaulted in paying his obligations thereunder, thus, PSB rescinded the said contract and title to the
property remained with the latter. Subsequently, the property was sold by PSB to the Spouses
Saturnina Baria and Tomas Co (Co Spouses) who, after paying the purchase price in full, caused
the registration of the same in their names and were, thus, issued TCT No. 14239.
Resultantly, Anama filed before the Respondent Court a complaint for declaration of nullity of the
deed of sale, cancellation of transfer certificate of title, and specific performance with damages
against PSB, the Co Spouses, and the Register of Deeds of Metro Manila, District II.
On August 21, 1991 and after trial on the merits, the Respondent Court dismissed Anama’s
complaint and upheld the validity of the sale between PSB and the Co Spouses. Undaunted, Anama
appealed, at first, to this Court, and after failing to obtain a favorable decision, to the Supreme Court.
On January 29, 2004, the Supreme Court rendered judgment denying Anama’s petition and
sustaining the validity of the sale between PSB and the Co Spouses. Its decision became final and
executory on July 12, 2004. Pursuant thereto, the Co Spouses moved for execution, which was
granted by the Respondent Court per its Order, dated November 25, 2005.
Aggrieved, Anama twice moved for the reconsideration of the Respondent Court’s November 25,
2005 Order arguing that the Co Spouses’ motion for execution is fatally defective. He averred that
the Spouses’ motion was pro forma because it lacked the required affidavit of service and has a
defective notice of hearing, hence, a mere scrap of paper. The Respondent Court, however, denied
Anama’s motion(s) for reconsideration.
Dissatisfied, the petitioner questioned the RTC Order before the CA for taking judicial cognizance of
the motion for execution filed by spouses Tomas Co and Saturnina Baria (Spouses Co) which was
(1) not in accord with Section 4 and Section 15 of the Rules of Court because it was without a notice
of hearing addressed to the parties; and (2) not in accord with Section 6, Rule 15 in conjunction with
Section 13, Rule 13 of the Rules of Court because it lacks the mandatory affidavit of service.
On March 31, 2008, the CA rendered a decision dismissing the petition. It reasoned out, among
others, that the issue on the validity of the deed of sale between respondents, Philippine Savings
Bank (PSB) and the Spouses Co, had long been laid to rest considering that the January 29, 2004
Decision of this Court became final and executory on July 12, 2004. Hence, execution was already a
matter of right on the part of the respondents and the RTC had the ministerial duty to issue a writ of
execution enforcing a final and executory decision.
The CA also stated that although a notice of hearing and affidavit of service in a motion are
mandatory requirements, the Spouses Co’s motion for execution of a final and executory judgment
could be acted upon by the RTC ex parte, and therefore, excused from the mandatory requirements
of Sections 4, 5 and 6 of Rule 15 of the Rules of Court.
The CA was of the view that petitioner was not denied due process because he was properly notified
of the motion for execution of the Spouses Co. It stated that the act of the Spouses Co in resorting to
personal delivery in serving their motion for execution did not render the motion pro forma. It refused
to apply a rigid application of the rules because it would result in a manifest failure of justice
considering that petitioner’s position was nothing but an obvious dilatory tactic designed to prevent
the final disposition of Civil Case No. 44940.
Not satisfied with the CA’s unfavorable disposition, petitioner filed this petition praying for the
reversal thereof presenting the following
ARGUMENTS:
THE RESPONDENT APPELLATE COURT DID NOT TAKE INTO CONSIDERATION THE CLEAR
TEACHING OF THE HONORABLE COURT WITH REGARD TO THE REQUISITE NOTICE OF
HEARING – IT SHOULD BE ADDRESSED TO THE PARTIES NOT TO THE CLERK OF COURT,
THE LATEST (THEN) BEING GARCIA V. SANDIGANBAYAN, G.R. NO. 167103, AUGUST 31,
2006, 500 SCRA 361; DE JESUS V. JUDGE DILAG, A.M. NO. RTJ-05-1921, SEPTEMBER 30,
2005, 471 SCRA 176; LAND BANK OF THE PHILIPPINES V. NATIVIDAD, G.R. NO. 127198, MAY
16, 2005, 458 SCRA 441; ATTY. JULIUS NERI V. JUDGE JESUS S. DE LA PEÑA, A.M NO. RTJ-
05-1896, APRIL 29, 2005, 457 SCRA 538; AND ALVAREZ V. DIAZ, A.M. NO. MTJ-00-1283,
MARCH 3, 2004, 424 SCRA 213;
THE RESPONDENT APPELLATE COURT DID NOT TAKE INTO CONSIDERATION THE CLEAR
TEACHING OF THE HONORABLE COURT WITH REGARD TO THE REQUISITE AFFIDAVIT OF
SERVICE – IT SHOULD BE IN THE PROPER FORM AS PRESCRIBED IN THE RULES AND IT
SHOULD BE ATTACHED TO THE MOTION, THE LATEST (THEN) BEING ELLO V. COURT OF
APPEALS, G.R. NO. 141255, JUNE 21, 2005, 460 SCRA 406; LOPEZ DELA ROSA
DEVELOPMENT CORPORATION V. COURT OF APPEALS, G.R. NO. 148470, APRIL 29, 2005,
457 SCRA 614; ALVAREZ V. DIAZ, A.M. NO. MTJ-00-1283, MARCH 3, 2004, 424 SCRA 213; EL
REYNO HOMES, INC. V. ERNESTO ONG, 397 SCRA 563; CRUZ V. COURT OF APPEALS, 388
SCRA 72, 80-81; AND MERIS V. OFILADA, 293 SCRA 606;
THE RESPONDENT APPELLATE COURT DID NOT TAKE APPROPRIATE ACTION ON THE
"FRAUD PERPETRATED UPON THE COURT" BY RESPONDENT-SPOUSES AND THEIR LEAD
COUNSEL.
SINCE THE RESPONDENT APPELLATE COURT REFUSED TO TAKE INTO CONSIDERATION

THE RESPONDENT BANK’S ACTION – THAT OF:
ENGAGING IN A DAGDAG-BAWAS (LEGALLY "INTERCALATION") OPERATION OF A PORTION

OF THE TRANSCRIPT OF STENOGRAPHIC NOTES (TSN), OCTOBER 12, 1984, OF THE
REGIONAL TRIAL COURT, BRANCH 167, PASIG CITY, IN CIVIL CASE NO. 44940, PAGES 54-55,
AND
PRESENTING IT IN ITS APPELLEE’S BRIEF (IN THE OWNERSHIP CASE, CA-G.R. NO. CV-
42663, LIKEWISE, BEFORE THE RESPONDENT APPELLATE COURT) BY CITING IT ON PAGE
14 OF SAID BRIEF, AS IMPLIEDLY COMING FROM THE TSN OF THE TRIAL COURT.
THINKING THAT THEIR FALSIFIED APPELLEE’S BRIEF WAS MATERIAL IN SAID CA-G.R. NO.
CV-42663.
IT COULD NOT RULE THAT THE SAME HAS BROUGHT ABOUT A CRUCIAL MATERIAL
CHANGE IN THE SITUATION OF THE PARTIES WHICH MAKES EXECUTION INEQUITABLE
(PUNCIA V. GERONA, 252 SCRA 424, 430-431), OR, IN THE WORDS OF DEVELOPMENT BANK
OF RIZAL V. CA, G.R. NO. 75964, DECEMBER 1, 1987, 156 SCRA 84, 90, "THERE EXISTS A
COMPELLING REASON FOR STAYING THE EXECUTION OF JUDGMENT."
Basically, petitioner argues that the respondents failed to substantially comply with the rule on notice
and hearing when they filed their motion for the issuance of a writ of execution with the RTC. He
claims that the notice of hearing in the motion for execution filed by the Spouses Co was a mere
scrap of paper because it was addressed to the Clerk of Court and not to the parties. Thus, the
motion for execution did not contain the required proof of service to the adverse party. He adds that
the Spouses Co and their counsel deliberately "misserved" the copy of their motion for execution,
thus, committing fraud upon the trial court.
Additionally, he claims that PSB falsified its appellee’s brief by engaging in a "dagdag-bawas"
("intercalation") operation in pages 54 to 55 of the TSN, dated October 12, 1984.
Position of the Spouses Co

The Spouses Co counter that the petition should be dismissed outright for raising both questions of
facts and law in violation of Section 1, Rule 45 of the Rules of Court. The Spouses Co aver that
petitioner attempts to resurrect the issue that PSB cheated him in their transaction and that the RTC
committed a "dagdag-bawas." According to the Spouses Co, these issues had long been threshed
out by this Court.
At any rate, they assert that they have substantially complied with the requirements of notice and
hearing provided under Sections 4 and 5 of Rule 15 and Section 13, Rule 13 of the Rules of Court.
Contrary to petitioner’s allegations, a copy of the motion for the issuance of a writ of execution was
given to petitioner through his principal counsel, the Quasha Law Offices. At that time, the said law
office had not formally withdrawn its appearance as counsel for petitioner. Spouses Co argue that
what they sought to be executed was the final judgment of the RTC duly affirmed by the CA and this
Court, thus, putting the issues on the merits to rest. The issuance of a writ of execution then
becomes a matter of right and the court’s duty to issue the writ becomes ministerial.
Position of respondent PSB
PSB argues that the decision rendered by the RTC in Civil Case No. 44940 entitled "Douglas F.
Anama v. Philippine Savings Bank, et. al." had long become final and executory as shown by the
3
Entry of Judgment made by the Court on July 12, 2004. The finality of the said decision entitles the
respondents, by law, to the issuance of a writ of execution. PSB laments that petitioner relies more
on technicalities to frustrate the ends of justice and to delay the enforcement of a final and executory
decision.
As to the principal issue, PSB points out that the notice of hearing appended to the motion for
execution filed by the Spouses Co substantially complied with the requirements of the Rules since
petitioner’s then counsel of record was duly notified and furnished a copy of the questioned motion
for execution. Also, the motion for execution filed by the Spouses Co was served upon and
personally received by said counsel.
The Court’s Ruling
The Court agrees with the Spouses Co that petitioner’s allegations on the "dagdag-bawas operation
of the Transcript of Stenographic Notes," the "fraud perpetuated upon the Court by said spouses and
their lead counsel," the "ownership," and "falsification" had long been laid to rest in the case
of "Douglas F. Anama v. Philippine Savings Bank, et. al." For said reason, the Court cannot review
4
those final pronouncements. To do so would violate the rules as it would open a final judgment to
another reconsideration which is a prohibited procedure.
On the subject procedural question, the Court finds no compelling reason to stay the execution of
the judgment because the Spouses Co complied with the notice and hearing requirements under
Sections 4, 5 and 6 of Rule 15. Said sections, as amended, provide:
SECTION 4. Hearing of motion. – Except for motions which the court may act upon without
prejudicing the rights of the adverse party, every written motion shall be set for hearing by the
applicant.
Every written motion required to be heard and the notice of the hearing thereof shall be served in
such a manner as to ensure its receipt by the other party at least three (3) days before the date of
hearing, unless the court for good cause sets the hearing on shorter notice.
SECTION 5. Notice of hearing. – The notice of hearing shall be addressed to all parties concerned,
and shall specify the time and date of the hearing which must not be later than ten (10) days after
the filing of the motion.
SECTION 6. Proof of service necessary. – No written motion set for hearing shall be acted upon by
the court without proof of service thereof.
Pertinently, Section 13 of Rule 13 of the 1997 Rules of Civil Procedure, as amended, provides:
SEC. 13. Proof of service. – Proof of personal service shall consist of a written admission of the
party served, or the official return of the server, or the affidavit of the party serving, containing a full
statement of the date, place, and manner of service. If the service is by ordinary mail, proof thereof
shall consist of an affidavit of the person mailing of facts showing compliance with section 7 of this
Rule. If service is made by registered mail, proof shall be made by such affidavit and the registry
receipt issued by the mailing office. The registry return card shall be filed immediately upon its
receipt by the sender, or in lieu thereof the unclaimed letter together with the certified or sworn copy
of the notice given by the postmaster to the addressee.
Elementary is the rule that every motion must contain the mandatory requirements of notice and
hearing and that there must be proof of service thereof. The Court has consistently held that a
motion that fails to comply with the above requirements is considered a worthless piece of paper
which should not be acted upon. The rule, however, is not absolute. There are motions that can be
acted upon by the court ex parte if these would not cause prejudice to the other party. They are not
strictly covered by the rigid requirement of the rules on notice and hearing of motions.
The motion for execution of the Spouses Co is such kind of motion. It cannot be denied that the
judgment sought to be executed in this case had already become final and executory. As such, the
Spouses Co have every right to the issuance of a writ of execution and the RTC has the ministerial
duty to enforce the same. This right on the part of the Spouses Co and duty on the part of the RTC
are based on Section 1 and Section 2 of Rule 39 of the 1997 Revised Rules of Civil Procedure
provides, 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.
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.
SEC. 2. Discretionary execution.—
(a) Execution of a judgment or final order pending appeal.— On motion of the prevailing party with
notice to the adverse party filed in the trial court while it has jurisdiction over the case and is in
possession of either the original record or the record on appeal, as the case may be, at the time of
the filing of such motion, said court may, in its discretion, order execution of a judgment or final order
even before the expiration of the period to appeal.
After the trial court has lost jurisdiction, the motion for execution pending appeal may be filed in the
appellate court.
Discretionary execution may only issue upon good reasons to be stated in a special order after due
hearing.
(b) Execution of several, separate or partial judgments.—A several, separate or partial judgment
may be executed under the same terms and conditions as execution of a judgment or final order
pending appeal. (2a) [Emphases and underscoring supplied]
As can be gleaned therefrom, under Paragraph 1 of Section 1 of Rule 39 of the 1997 Revised Rules
of Civil Procedure, the Spouses Co can have their motion for execution executed as a matter of right
without the needed notice and hearing requirement to petitioner. This is in contrast to the provision
of Paragraph 2 of Section 1 and Section 2 where there must be notice to the adverse party. In the
case of Far Eastern Surety and Insurance Company, Inc. v. Virginia D. Vda. De Hernandez, it was 5
written:
It is evident that Section 1 of Rule 39 of the Revised Rules of Court does not prescribe that a
copy of the motion for the execution of a final and executory judgment be served on the
defeated party, like litigated motions such as a motion to dismiss (Section 3, Rule 16), or motion for
new trial (Section 2, Rule 37), or a motion for execution of judgment pending appeal (Section 2, Rule
39), in all of which instances a written notice thereof is required to be served by the movant on the
adverse party in order to afford the latter an opportunity to resist the application.
It is not disputed that the judgment sought to be executed in the case at bar had already become
final and executory. It is fundamental that the prevailing party in a litigation may, at any time within
five (5) years after the entry thereof, have a writ of execution issued for its enforcement and the court
not only has the power and authority to order its execution but it is its ministerial duty to do so. It has
also been held that the court cannot refuse to issue a writ of execution upon a final and executory
judgment, or quash it, or order its stay, for, as a general rule, the parties will not be allowed, after
final judgment, to object to the execution by raising new issues of fact or of law, except when there
had been a change in the situation of the parties which makes such execution inequitable or when it
appears that the controversy has ever been submitted to the judgment of the court; or when it
appears that the writ of execution has been improvidently issued, or that it is defective in substance,
or is issued against the wrong party, or that judgment debt has been paid or otherwise satisfied; or
when the writ has been issued without authority. Defendant-appellant has not shown that she falls in
any of the situations afore-mentioned. Ordinarily, an order of execution of a final judgment is not
appealable. Otherwise, as was said by this Court in Molina v. de la Riva, a case could never end.
Once a court renders a final judgment, all the issues between or among the parties before it are
deemed resolved and its judicial function as regards any matter related to the controversy litigated
comes to an end. The execution of its judgment is purely a ministerial phase of adjudication. The
nature of its duty to see to it that the claim of the prevailing party is fully satisfied from the properties
of the loser is generally ministerial.
In Pamintuan v. Muñoz, We ruled that once a judgment becomes final and executory, the prevailing
party can have it executed as a matter of right, and the judgment debtor need not be given
advance notice of the application for execution.
Also of the same stature is the rule that once a judgment becomes final and executory, the prevailing
party can have it executed as a matter of right and the granting of execution becomes a ministerial
duty of the court. Otherwise stated, once sought by the prevailing party, execution of a final
judgment will just follow as a matter of course. Hence, the judgment debtor need not be given
advance notice of the application for execution nor he afforded prior hearing.
Absence of such advance notice to the judgment debtor does not constitute an infringement of the
constitutional guarantee of due process.
However, the established rules of our system of jurisprudence do not require that a defendant who
has been granted an opportunity to be heard and has had his day in court should, after a judgment
has been rendered against him, have a further notice and hearing before supplemental proceedings
are taken to reach his property in satisfaction of the judgment. Thus, in the absence of a statutory
requirement, it is not essential that he be given notice before the issuance of an execution against
his tangible property; after the rendition of the judgment he must take "notice of what will follow," no
further notice being "necessary to advance justice." [Emphases and underscoring supplied]
Likewise, in the case of Leonardo Lim De Mesa v. Hon. Court of Appeals, it was stated:
6
In the present case, the decision ordering partition and the rendition of accounting had already
become final and executory. The execution thereof thus became a matter of right on the part of the
plaintiffs, herein private respondents, and is a mandatory and ministerial duty on the part of the
court. Once a judgment becomes final and executory, the prevailing party can have it
executed as a matter of right, and the judgment debtor need not be given advance notice of
the application for execution nor be afforded prior hearings thereon.
On the bases of the foregoing considerations, therefore, the Court of Appeals acted correctly in
holding that the failure to serve a copy of the motion for execution on petitioner is not a fatal defect.
In fact, there was no necessity for such service. [Emphases and underscoring supplied]
At any rate, it is not true that the petitioner was not notified of the motion for execution of the
Spouses Co. The records clearly show that the motion for execution was duly served upon, and
received by, petitioner’s counsel-of-record, the Quasha Ancheta Pena Nolasco Law Offices, as
evidenced by a "signed stamped received mark" appearing on said pleading. The records are bereft
7
of proof showing any written denial from petitioner’s counsel of its valid receipt on behalf of its client.
Neither is there proof that the Quasha Ancheta Pena Nolasco Law Offices has formally withdrawn its
appearance as petitioner’s counsel-of-record. Considering that there is enough proof shown on
record of personal delivery in serving the subject motion for execution, there was a valid compliance
with the Rules, thus, no persuasive reason to stay the execution of the subject final and executory
judgment.
Moreover, this Court takes note that petitioner was particularly silent on the ruling of the CA that he
was notified, through his counsel, of the motion for execution of the Spouses Co when he filed a
motion for reconsideration of the RTC’s order dated June 28, 2005, holding in abeyance said motion
pending the resolution of petitioner’s pleading filed before this Court. He did not dispute the ruling of
the CA either that the alleged defect in the Spouses Co’s motion was cured when his new counsel
was served a copy of said motion for reconsideration of the RTC’s June 28, 2005 Order. 8
The three-day notice rule is not absolute. A liberal construction of the procedural rules is proper
where the lapse in the literal observance of a rule of procedure has not prejudiced the adverse party
and has not deprived the court of its authority. Indeed, Section 6, Rule 1 of the Rules of Court
provides that the Rules should be liberally construed in order to promote their objective of securing a
just, speedy and inexpensive disposition of every action and proceeding. Rules of procedure are
tools designed to facilitate the attainment of justice, and courts must avoid their strict and rigid
application which would result in technicalities that tend to frustrate rather than promote substantial
justice.
In Somera Vda. De Navarro v. Navarro, the Court held that there was substantial compliance of the
rule on notice of motions even if the first notice was irregular because no prejudice was caused the
adverse party since the motion was not considered and resolved until after several postponements
of which the parties were duly notified.
Likewise, in Jehan Shipping Corporation v. National Food Authority, the Court held that despite the
lack of notice of hearing in a Motion for Reconsideration, there was substantial compliance with the
requirements of due process where the adverse party actually had the opportunity to be heard and
had filed pleadings in opposition to the motion. The Court held:
This Court has indeed held time and again, that under Sections 4 and 5 of Rule 15 of the Rules of
Court, mandatory is the requirement in a motion, which is rendered defective by failure to comply
with the requirement. As a rule, a motion without a notice of hearing is considered pro forma and
does not affect the reglementary period for the appeal or the filing of the requisite pleading.
As an integral component of the procedural due process, the three-day notice required by the Rules
is not intended for the benefit of the movant. Rather, the requirement is for the purpose of avoiding
surprises that may be sprung upon the adverse party, who must be given time to study and meet the
arguments in the motion before a resolution of the court. Principles of natural justice demand that the
right of a party should not be affected without giving it an opportunity to be heard.
The test is the presence of opportunity to be heard, as well as to have time to study the
motion and meaningfully oppose or controvert the grounds upon which it is
based. [Emphases and underscoring supplied]
9
Likewise, in the case of KKK Foundation, Inc. v. Hon. Adelina Calderon-Bargas, this Court stated:
10
Anent the second issue, we have consistently held that a motion which does not meet the
requirements of Sections 4 and 5 of Rule 15 of the Rules of Court is considered a worthless piece of
paper, which the Clerk of Court has no right to receive and the trial court has no authority to act
upon. Service of a copy of a motion containing a notice of the time and the place of hearing of that
motion is a mandatory requirement, and the failure of movants to comply with these requirements
renders their motions fatally defective. However, there are exceptions to the strict application of
this rule. These exceptions are: (1) where a rigid application will result in a manifest failure or
miscarriage of justice especially if a party successfully shows that the alleged defect in the
questioned final and executory judgment is not apparent on its face or from the recitals contained
therein; (2) where the interest of substantial justice will be served; (3) where the resolution of the
motion is addressed solely to the sound and judicious discretion of the court; and (4) where the
injustice to the adverse party is not commensurate with the degree of his thoughtlessness in not
complying with the procedure prescribed.
A notice of hearing is an integral component of procedural due process to afford the adverse parties
a chance to be heard before a motion is resolved by the court. Through such notice, the adverse
party is given time to study and answer the arguments in the motion. Records show that while
Angeles’s Motion for Issuance of Writ of Execution contained a notice of hearing, it did not
particularly state the date and time of the hearing. However, we still find that petitioner was not
denied procedural due process. Upon receiving the Motion for Issuance of Writ of Execution, the trial
court issued an Order dated September 9, 2002 giving petitioner ten (10) days to file its comment.
The trial court ruled on the motion only after the reglementary period to file comment lapsed. Clearly,
petitioner was given time to study and comment on the motion for which reason, the very purpose of
a notice of hearing had been achieved.
The notice requirement is not a ritual to be followed blindly. Procedural due process is not based
1âwphi1
solely on a mechanical and literal application that renders any deviation inexorably fatal. Instead,
procedural rules are liberally construed to promote their objective and to assist in obtaining a just,
speedy and inexpensive determination of any action and proceeding. [Emphases supplied]
At any rate, it is undisputed that the August 21, 1991 RTC Decision in Civil Case No. 44940 is
11
already final and executory. Once a judgment becomes final and executory, all the issues between
the parties are deemed resolved and laid to rest. All that remains is the execution of the decision
which is a matter of right. The prevailing party is entitled to a writ of execution, the issuance of which
is the trial court’s ministerial duty.
12
The Court agrees with the respondents that petitioner mainly relies on mere technicalities to frustrate
the ends of justice and further delay the execution process and enforcement of the RTC Decision
that has been affirmed by the CA and this Court. The record shows that the case has been dragging
on for almost 30 years since petitioner filed an action for annulment of sale in 1982. From the time
the Spouses Co bought the house from PSB in 1978, they have yet to set foot on the subject house
and lot.
To remand the case back to the lower court would further prolong the agony of the Spouses Co. The
Court should not allow this to happen. The Spouses Co should not be prevented from enjoying the
fruits of the final judgment in their favor. In another protracted case, the Court wrote:
As a final note, it bears to point out that this case has been dragging for more than 15 years and the
execution of this Court’s judgment in PEA v. CA has been delayed for almost ten years now simply
because De Leon filed a frivolous appeal against the RTC’s order of execution based on arguments
that cannot hold water. As a consequence, PEA is prevented from enjoying the fruits of the final
judgment in its favor. The Court agrees with the Office of the Solicitor General in its contention that
every litigation must come to an end once a judgment becomes final, executory and unappealable.
Just as a losing party has the right to file an appeal within the prescribed period, the winning party
also has the correlative right to enjoy the finality of the resolution of his case by the execution and
satisfaction of the judgment, which is the "life of the law." To frustrate it by dilatory schemes on the
part of the losing party is to frustrate all the efforts, time and expenditure of the courts. It is in the
interest of justice that this Court should write finis to this litigation.
13
WHEREFORE, the petition is DENIED.
SO ORDERED.
G.R. No. 130314 September 22, 1998
ANNIE TAN, petitioner,
vs.
COURT OF APPEALS and BLOOMBERRY EXPORT MANUFACTURING, INC., respondents.
PANGANIBAN, J.:
Before a trial court, a motion for reconsideration that does not contain the requisite notice of hearing
does not toll the running of the period of appeals. It is a mere scrap of paper which the trial court and
the opposite party may ignore.
The Case
Petitioner seeks to set aside the August 22, 1997 Decision of the Court of Appeals in CA-GR SP
1
No. 43293, the dispositive portion of which reads: 2
WHEREFORE, [i]n view of all the foregoing considerations, the petition

for certiorari and prohibition is granted. The Order dated October 4, 1996, of public
respondent is hereby SET ASIDE and public respondent is ordered to desist from
further proceeding with the hearing of the Motion for Reconsideration. The Decision
dated July 18, 1996, of public respondent is declared final and executory.
The Facts
Petitioner Annie Tan, doing business under the name and style "AJ & T Trading," leased a portion of
the ground floor of her building, more specifically described as Stall No. 623, Carvajal Street,
Binondo, Manila, in favor of Bloomberry Export Manufacturing, Inc. The lease was for a period of five
years starting on February 17, 1995 and ending on February 17, 2000, at a monthly rental of
P20,000 for the first three years. For several alleged violations of the lease contract, petitioner filed
3
against private respondent a complaint for ejectment, docketed as Civil Case No. 148798-CV. As its
4
rental payment was refused by petitioner, private respondent instituted on July 13, 1995 a case for
consignation, docketed as Civil Case No. 148814-CV. 5
The two cases were consolidated. In due course, the Metropolitan Trial Court (MTC) of Manila,
Branch I, rendered on February 1, 1996 a Decision which disposed as follows:
6 7
WHEREFORE, in Civil Case No. 148798-CV for [b]reach of [c]ontract, failure to pay
rentals on time, encroachment on the adjacent premises without the consent of
[petitioner], [she] failed to substantiate her case with that degree of proof required by
law. For this reason, except for the costs of suit, this Court hereby orders the
dismissal of the complaint of [petitioner]. The counterclaim and damages sought by
[private respondent are] likewise ordered dismissed. The case for consignation in
Civil Case No. 148814-CV has become moot and academic for failure of [petitioner]
to appeal the decision of the Metropolitan [Trial] court, Branch 15, Manila, allowing
the [private respondent] to consign rental payments to the Court of Manila. Besides,
the [c]omplaint for consignation being in conformity with law, [private respondent] is
allowed to continue consigning with this Court all rentals that [may be] due.
On appeal, the Regional Trial Court (RTC) of Manila, Branch 2, in its Decision dated July 18, 1996,
affirmed the aforementioned MTC Decision thus:
WHEREFORE, finding no cogent reasons to disturb the joint decision dated February
1, 1996 of the Metropolitan Trial Court of Manila, Branch 1, the Court sustains and
affirms in toto the said decision.
Respondent Court related the incidents that ensued, as follows: 8
. . . [F]rom the Decision of the [RTC] dated July 18, 1996, [petitioner] filed a Motion
for Reconsideration of the aforesaid decision. The Motion for Reconsideration did not
contain any notice of hearing as required under Section 5, Rule 15 of the Revised
Rule of Court.
On August 23, 1996, [private respondent] filed an ex-parte Motion for Entry of

Judgment upon the ground that said motion for reconsideration is a mere scrap of
paper which should not merit the attention of the [RTC] and in support thereof, cited
the case of Traders Royal Bank vs. Court of Appeals, 208 SCRA 199. [Private
respondent] contends that since the Motion for Reconsideration is a mere scrap of
paper aside from being pro forma, said Motion for Reconsideration did not toll the
period of appeal[;] hence, the Decision dated July 18, 1996, had become final and
executory.
On September 3, 1996, [petitioner] filed a Motion to Set for Hearing the Motion for
Reconsideration which was vehemently opposed by [private respondent] on
September 23, 1996.
On October 4, 1996, [the RTC] issued an Order granting the motion to set for hearing
[petitioner's] Motion for Reconsideration and set[ting] the hearing [for] October 21,
1996, at 8:30 o'clock in the morning. On October 20, 1996, [private respondent] filed
a Motion for Reconsideration of the Order dated October 4, 1996, which was set for
hearing on October 25, 1996.
On November 11, 1996, [the RTC] issued an Order denying [private respondent's]
Motion for Reconsideration. Hence, the Petition for Certiorari and Prohibition. . . . .
In the assailed Decision, Respondent Court of Appeals reversed the trial court's setting for hearing
petitioner's Motion for Reconsideration.
Respondent Court held that the trial court acted with grave abuse of discretion in setting for hearing
petitioner's Motion for Reconsideration, notwithstanding the fact that said Motion contained no notice
of hearing.
Citing a litany of cases, it ruled that petitioner's failure to comply with the mandatory provisions of
Sections 4 and 5, Rule 15 of the Rules of Court, reduced her motion to a mere scrap of paper which
did not merit the attention of the court. Respondent Court also held that those cases in which the
Court allowed a motion for reconsideration that had not been set for hearing — Galvez v. Court of
Appeals, Tamargo v. Court of Appeals and Que v. Intermediate Appellate Court — were
9 10 11
inapplicable.
Respondent Court held that the facts in Galvez drastically differ from those in the present
case. Galvez involved a motion to withdraw the information — not a motion for reconsideration —
that was filed ex parte before the arraignment of the accused. In that case, the Court held that there
was no imperative need of notice and hearing because, first, the withdrawal of an information rests
on the discretion of the trial court; and, second, the accused was not placed in jeopardy. On the
other hand, the subject of the present controversy is a motion for reconsideration directed against
the Decision of the RTC; thus, the motion affects the period to perfect an appeal.
Que is not applicable either. In said case, the trial court, set the Motion for Reconsideration (MR) for
hearing, which was actually attended by the counsel for the adverse party. This was not so in the
case at bar; petitioner's MR was set for hearing, because she belatedly moved for it upon the filing of
private respondent's Motion for Entry of Judgment. Likewise, the present case differs from Tamargo,
wherein the application of the aforesaid mandatory provisions was suspended. The Court did so in
order to give substantial justice to the petitioner and in view of the nature of the issues raised which
were found to be highly meritorious.
Hence, this petition.

12
The Issue
In her Memorandum, petitioner presents a fairly accurate statement of the main issue to be
13
resolved: 14
Whether . . . the omission [through] inadvertence of a notice of hearing of a motion

for reconsideration filed with the trial court . . . is a fatal defect which did not stop the
running of the period to appeal[,] thus rendering the assailed decision final [and]
executory.
The Court's Ruling
The petition is devoid of merit.
Sole Issue:
Omission of Notice of Hearing Fatal
Petitioner admits the categorical and mandatory character of the directives in Sections 4 and 5 of
Rule 15 of the Rules of Court, which read: 15
Sec. 4. Hearing of motion. — Except for motions which the court may act upon
without prejudicing the rights of the adverse party, every written motion shall be set
for hearing by the applicant.
Every written motion required to be heard and the notice of the hearing thereof shall
be served in such a manner as to ensure its receipt by the other party at least three
(3) days before the date of hearing, unless the court for good cause sets the hearing
on shorter notice. (4a)
Sec. 5. Notice of hearing. — The notice of hearing shall be addressed to all parties
concerned, and shall specify the time and date of the hearing which must not be later
than ten (10) days after the filing of the motion. (5a)
In De la Peña v. De la Peña, the Court presented a resume of earlier decisions regarding the
16
necessity of the notice of hearing in motions for reconsideration:
In Pojas v. Gozo-Dadole, we had occasion to rule on the issue of whether a motion
17
for reconsideration without any notice of hearing tolls the running of the prescriptive
period. In Pojas, petitioner received copy of the decision in Civil Case No. 3430 of
the Regional Trial Court of Tagbilaran on 15 April 1986. The decision being adverse
to him petitioner filed a motion for reconsideration. For failing to mention the date
when the motion was to be resolved as required in Sec. 5, Rule 15, of the Rules of
Court, the motion for reconsideration was denied. A second motion for
reconsideration met the same fate. On 2 July 1986 petitioner filed a notice of appeal
but the same was denied for being filed out of time as "the motion for reconsideration
which the Court ruled as pro forma did not stop the running of the 15-day period to
appeal." 18
In resolving the issue of whether there was grave abuse of discretion in denying
petitioner's notice of appeal, this Court ruled —
Sec. 4 of Rule 15 of the Rules of Court requires that notice of motion

be served by the movant on all parties concerned at least three (3)
days before its hearing. Section 5 of the same Rule provides that the
notice shall be directed to the parties concerned, and shall state the
time and place for the hearing of the motion. A motion which does not
meet the requirements of Section 4 and 5 of Rule 15 of the Rules of
Court is considered a worthless piece of paper which the clerk has no
right to receive and the court has no authority to act upon. Service of
copy of a motion containing notice of the time and place of hearing of
said motion is a mandatory requirement and the failure of the movant
to comply with said requirements renders his motion fatally
defective.
19
In New Japan Motors, Inc. v. Perucho, defendant filed a motion for reconsideration
20
which did not contain any notice of hearing. In a petition for certiorari, we affirmed the
lower court in ruling that a motion for reconsideration that did not contain a notice of
hearing was a useless scrap of paper. We held further —
Under Sections 4 and 5 of Rule 15 of the Rules of Court, . . . a motion

is required to be accompanied by a notice of hearing which must be
served by the applicant on all parties concerned at least three (3)
days before the hearing thereof Section 6 of the same rule
commands that "(n)o motion shall be acted upon by the Court,
without proof of service of the notice thereof . . . ." It is therefore
patent that the motion for reconsideration in question is fatally
defective for it did not contain any notice of hearing. We have already
consistently held in a number of cases that the requirements of
Sections 4, 5 and 6 of Rules 15 of the Rules of Court are mandatory
and that failure to comply with the same is fatal to movant's cause.
In Sembrano v. Ramirez, we declared that —

22
(A) motion without notice of hearing is a mere scrap of paper. It does

not toll the running of the period of appeal. This requirement of notice
of hearing equally applies to a motion for reconsideration. Without
such notice, the motion is pro forma. And a pro forma motion for
reconsideration does not suspend the running of the period to appeal.
In In re Almacen, defendant lost his case in the lower court. His counsel then filed a
23
motion for reconsideration but did not notify the adverse counsel of the time and
place of hearing of said motion. The Court of Appeals dismissed the motion for the
reason that "the motion for reconsideration dated July 5, 1966 does not contain a
notice of time and place of hearing thereof and is, therefore a useless piece of paper
which did not interrupt the running of the period to appeal, and, consequently, the
appeal was perfected out of time." When the case was brought to us, we reminded
counsel for the defendant that —
As a law practitioner who was admitted to the bar as far back as

1941, Atty. Almacen knew — or ought to have known — that [for] a
motion for reconsideration to stay the running of the period of appeal,
the movant must not only serve a copy of the motion upon the
adverse party . . . but also notify the adverse party of the time and
place of hearing . . . .
Also, in Manila Surety and Fidelity Co., Inc. v. Bath Construction and Company, we
24
ruled —
The written notice referred to evidently is that prescribed for motions

in general by Rule 15, Sections 4 and 5 (formerly Rule 26), which
provide that such notice shall state the time and place of hearing and
shall be served upon all the parties concerned at least three days in
advance. And according to Section 6 of the same Rule no motion
shall be acted upon by the court without proof of such notice. Indeed,
it has been held that in such a case the motion is nothing but a
useless piece of paper. The reason is obvious; unless the movant
sets the time and place of hearing the court would have no way to
determine whether that party agrees to or objects to the motion, and
if he objects, to hear him on his objection, since the Rules themselves
do not fix any period within [which] he may file his reply or
opposition. 25
In fine, the abovecited cases confirm that the requirements laid down in Sec. 5 of
Rule 15 of the Rules of Court that the notice shall be directed to the parties
concerned, and shall state the time and place for the hearing of the motion, are
mandatory. If not religiously complied with, they render the motion pro forma. As
such the motion is a useless piece of paper that will not toll the running of the
prescriptive period.
For failing to attach a notice of hearing to the Motion for Reconsideration, petitioner proffers the
following excuses: (1) her former counsel's messenger, due to an honest mistake, inadvertently
omitted the fourth page of the motion containing the crucial Notice of Hearing; and (2) because of
the pressure of work, her former counsel was unable to follow up such motion until the day said
counsel requested the setting of a hearing. 26
We are not in the least convinced. First, it is unfair to place the blame for such omission on the
messenger. The burden of preparing a complete pleading falls on counsel's shoulders, not on the
messenger's. The counsel is ultimately responsible for the acts or omissions of his agents. Hence,
the messenger's conduct can neither justify the counsel's mistake nor warrant a departure from the
mandate of the aforesaid procedural rules.
Second, it is incredible that the fourth page containing the Notice of Hearing was left behind due to
honest mistake. In fact, there was no such page. Petitioner's claim is belied by the following
pertinent, portions of the subject Motion for Reconsideration: 27
WHEREFORE, premises considered, it is respectfully prayed that the Honorable

Court cause a further REVIEW and RECONSIDERATION of its decision on the
above-captioned consolidated cases.
Quezon City for Manila, August 12, 1996.
(Sgd.) ANGELINA ARANDIA-

VILLANUEVA
Counsel for Plaintiff-Appellant
39-L T. Morato Avenue, Quezon City
IBP No. 407450 6-26-96
PTR No. 227013 1-5-96 Manila
Copy furnished:
Atty. Arnel Zaragoza Dolendo
Counsel for Defendant
Rm. 408, 413 First United Bldg.
Escolta, Manila
The normal practice is to note, at the end of the pleading, that a copy was furnished to the adverse
party. Thus, petitioner's motion ended exactly at the bottom of the third page as evidenced by the
"copy-furnished" notation. It is safe to conclude that there was no accidental or excusable neglect in
not including a fourth page in this case. In other words, petitioner's counsel simply failed to include a
notice of hearing.
Finally, the fact that petitioner's former counsel calendared the motion for hearing for August 23,
1996 belies the excuse that an alleged fourth page had been left behind. In the first place, if a
28
notice of hearing had been included in the Motion for Reconsideration, there would have been no
need for petitioner to file the Motion to set the time and date of hearing. What is clear is that said
counsel filed the latter Motion, only after private respondent had submitted its Motion for Entry of
Judgment — with copy furnished petitioner's counsel — on the ground that petitioner's Motion for
29 30
Reconsideration was a mere scrap of paper that did not stop the period for appeal.
Petitioner pleads for liberal construction of the rule on notice of hearing,

citing Tamargo, Galvez and Que. In rebuttal, we adopt by reference the CA's excellent disquisition,
cited earlier, on why these cases are inapplicable.
Petitioner further alleges that, first, the nonadmission of her Motion for Reconsideration would result
in a miscarriage of justice, as the main case (ejectment), which was tried under summary procedure,
had been unnecessarily prolonged; and, second, the tenant lessee would be occupying the
premises without paying rentals. She also relies on People v. Leviste, in which the Court held:
31
While it is true that any motion that does not comply with the requirements of Rule
15, Rules of Court should not be accepted for filing and, if filed, is not entitled to
judicial cognizance, the Supreme Court has likewise held that where rigid application
of the rule will result in manifest failure or miscarriage of justice, technicalities may be
disregarded in order to resolve the case.
Liberal construction of this rule has been allowed by this Court in the following cases: (1) where a
rigid application will result in a manifest failure or miscarriage of justice, especially if a party
32
successfully shows that the alleged defect in the questioned final and executory judgment is not
apparent on its face or from the recitals contained therein; (2) where the interest of substantial
33
justice will be served; (3) where the resolution of the motion is addressed solely to the sound and
34
judicious discretion of the court; and (4) where the injustice to the adverse party is not
35
commensurate with the degree of his thoughtlessness in not complying with the procedure
prescribed. Petitioner has failed to demonstrate that the case at bar falls under any of these
36
exceptions.
Finally, petitioner claims that she will be deprived of property without due process, as private
respondent has accumulated P348,800 in unpaid rentals and accrued interests.
We disagree. Petitioner can obtain proper payment of rentals through a motion for execution in the
case below. The MTC may have dismissed her ejectment case, but it did not exculpate private
respondent from its liabilities. Petitioner is, therefore, not being deprived of her property without due
process.
Indeed, there is no miscarriage of justice to speak of. Having failed to observe very elementary rules
of procedure which are mandatory, petitioner caused her own predicament. To exculpate her from
the compulsory coverage of such rules is to undermine the stability of the judicial process, as the
bench and bar will be confounded by such irritating uncertainties as when to obey and when to
ignore the Rules. We have to draw the line somewhere. 37
WHEREFORE, the petition is hereby DENIED and the assailed Decision is AFFIRMED. Costs
against the petitioner.
SO ORDERED.
G.R. No. 150870 December 11, 2002
DRA. HONORATA G. BAYLON, petitioner,

vs.
FACT-FINDING INTELLIGENCE BUREAU represented by DIRECTOR AGAPITO ROSALES
and the OFFICE OF THE OMBUDSMAN, respondents.
DECISION
CARPIO-MORALES, J.:
By the present petition for review on certiorari, petitioner prays this Court to give due course to her
appeal and to ultimately set aside the Office of the Ombudsman’s order for her suspension from
public office.
The following facts are not disputed:
Sometime in 1993, Dr. Honorata G. Baylon (petitioner), Head of the Division of Hematology and
Transfusion Medicine at the National Kidney and Transplant Institute (NKTI), was designated as
Program Manager of the government’s National Voluntary Blood Donation Program (Blood Donation
Program) with NKTI as the lead agency in the implementation thereof.
The Blood Donation Program later became a component of the project "STOP D.E.A.T.H (Disasters,
Epidemics, and Trauma for Health): Hospitals for Philippines 2000" which was launched on February
18, 1994 by the Department of Health (DOH) headed by the then Secretary Juan M. Flavier
(Flavier).1 Petitioner remained at the helm of the Blood Donation Program.2
On February 24, 1994, Flavier publicly disclosed the results of the United States Agency for
International Development (USAID)-sponsored study on the safety of the country’s blood banking
system which found out that the Philippines’ blood transfusion service failed to adequately meet the
demand for safe blood and that the blood sourced from commercial blood banks had a
contamination rate of four percent.3 Flavier thus ordered the closure of provincial retail outlets of
commercial blood banks as a result of which an acute shortage of transfused blood ensued because
of the blood banks’ refusal to sell blood in retaliation to the said closure order.
Flavier accordingly directed the full operation of the Blood Donation Program, which apparently
served as the then only viable system from which blood could be sourced.
On March 8 and 17, 1994, the NKTI, through petitioner, issued Requisition and Issue Vouchers4 for
the purpose of purchasing blood bags for immediate distribution to DOH hospitals or medical centers
where the system of voluntary blood donation would then be put in place. As "Terumo" blood bags
were believed to be the finest in the market, the NKTI obtained a quotation therefor dated March 16,
19945 from their exclusive distributor, the FVA EX-IM Trading, Inc. (FVA), as follows:
1. [Blood Bag], Single Capacity = P 72.29 [per piece]
2. Double Capacity = P171.00
3. Triple Capacity = P263.70
Another quotation dated March 29, 19946 was later furnished by FVA reflecting the following reduced
prices:
1. Single = P 63.54
2. Double = P150.00
3. Triple = P209.09
Petitioner signified her conformity to the second quotation. The NKTI subsequently purchased
"Terumo" blood bags from FVA under the following purchase orders with their corresponding dates,
the respective amounts involved in each sale transaction, and the names of the approving authority:7
Purchase
Date Amount Approving Authority
Order No.
1. April 11, 1994 94-00943 P1,270,800.00 Juan M. Flavier,
Jaime Galvez-Tan
Juan R. Nanagas
2. May 25, 1994 94-00132 P536,025.00 Filoteo A. Alano
(recommended by
Aileen R. Javier)
3. August 12, 1994 94-00147 P1,702,687.65 Juan M. Flavier
4. November 14, 1994 94-00172 P2,209,915.00 Juan M. Flavier
5. December 6, 1994 94-00182 P 506,585.45 Juan M. Flavier
In March 1995, the Commission on Audit (COA) disallowed in post audit the sale transactions
entered into by the NKTI with FVA on the ground that the blood bags were purchased without public
bidding, contrary to the applicable laws or rules, thereby allegedly resulting to overpricing.8 The COA
found that FVA sold "Terumo" blood bags to the Philippine National Red Cross (PNRC) and to blood
banks Our Lady of Fatima and Mother Seaton at prices lower than those at which it sold to the NKTI,
leading to a consequent total loss to the government in the amount of P1,964,304.70.
The Auditor of the NKTI accordingly ordered the suspension of purchases of blood bags from FVA
and eventually disallowed the payment of blood bags amounting to P6,006,133.54.
A criminal complaint, docketed as OMB-0-97-0242, for violation of Section 3(e) and (g) of Republic
Act (R. A.) No. 3019 (The Anti-Graft and Corrupt Practices Act), was thus filed by the Office of the
Ombudsman against petitioner, Flavier, then DOH Undersecretaries Dr. Jaime Galvez-Tan and Dr.
Juan R. Nañagas, NKTI Executive Director Dr. Filoteo A. Alano, NKTI Deputy Executive Director Dr.
Aileen R. Javier, NKTI Property Division Chief Diana Jean F. Prado and NKTI Accounting Division
Chief Maribel U. Estrella. At the same time, an administrative complaint for gross misconduct was
lodged against petitioner and the same respondents except Flavier and Galvez-Tan.
The administrative complaint was docketed as OMB-ADM-0-97-0165, now the subject of the present
petition.
Petitioner disclaimed administrative liability. Adopting9 her May 20, 1997 counter-affidavit10 filed in

the criminal complaint, petitioner claimed that the acquisition of the blood bags via negotiated
purchase came under the exceptions to public bidding as provided for by law, citing the following
pertinent provision of Executive Order No. 301 (DECENTRALIZING ACTIONS ON GOVERNMENT
NEGOTIATED CONTRACTS, LEASE CONTRACTS AND RECORDS DISPOSAL):
SECTION 1. Guidelines for Negotiated Contracts. – Any provision of law, decree, executive order or
other issuances to the contrary notwithstanding, no contract for public services or for furnishing
supplies, materials and equipment to the government or any of its branches, agencies or
instrumentalities shall be renewed or entered into without public bidding, except under any of the
following situations:
xxx
b. Whenever the supplies are to be used in connection with a project or activity which cannot
be delayed without causing detriment to the public service;
c. Whenever the materials are sold by an exclusive distributor or manufacturer who does not
have sub-dealers selling at lower prices and for which no suitable substitute can be obtained
elsewhere at more advantageous terms to the government;
xxx
e. In cases where it is apparent that the requisition of the needed supplies through
negotiated purchase is most advantageous to the government to be determined by the
Department Head concerned;
x x x (Underscoring supplied).
Thus she explained: firstly, the blood bags were used in the Blood Donation Program which had to
be implemented immediately to address the scarcity of blood at the time; secondly, FVA was the
only exclusive distributor without subdealers of "Terumo" blood bags; and thirdly, negotiated
purchase of the blood bags was most advantageous to the government for the prices at which the
NKTI obtained them from FVA were the lowest compared to those at which they were acquired by
other government hospitals, as the following shows:11
BLOOD BAGS
HOSPITALS
Single Double Triple
NKTI P63.54 P150.00 P209.00
Philippine General Hospital P78.00 P185.40 P285.00
Jose Reyes Memorial Medical Center P85.05 - - - - - - – - - - - -
Dr. Jose Fabella Memorial Hospital P85.00 P199.00 - - – – - -
Philippine Children's Medical Center P64.00 - - - - - - P209.09
Philippine Heart Center P78.00 P190.00 - - - - - -
Petitioner submitted certifications12 from various medical establishments attesting to the superior

quality and features of "Terumo" blood bags which have made them the most widely used among
hospitals and blood banks; the counter-affidavit filed in the same criminal complaint of FVA
President Francisco V. Abalos,13 who was subsequently dropped as respondent therein upon his
death on January 31, 1998; and Flavier’s December 3, 1999 sworn statement submitted also in the
criminal complaint.
In his counter-affidavit, Abalos explained that the lower prices at which the FVA sold blood bags to
PNRC, Mother Seaton and Our Lady of Fatima, were meant to aid these blood banks to reduce their
operational costs so that they would sell at low prices to their buyers who were mostly the poor, as
well as to reduce FVA’s excess inventory then.
In his December 3, 1999 sworn statement, Flavier declared that the negotiated purchase of the
blood bags was justified by the conditions obtaining at the time; the NKTI’s transactions with FVA
were not tainted with any irregularities; petitioner and the other NKTI officials were responsible for
successfully implementing a 100% voluntary blood donation system in ten regional hospitals and
medical centers; and that were it not for petitioner’s work as Program Manager of the Blood
Donation Program, disastrous consequences would have befallen patients, the DOH, and the Blood
Donation Program itself.
By Memorandum Review of June 13, 2000,14 Assistant Ombudsman Abelardo L. Aportadera

(Aportadera) recommended the exoneration of the respondents Nañagas and Estrella. Taking note,
of the Ombudsman’s finding of probable cause to criminally hale petitioner and company into court,
Aportadera recommended, by the same Review Memorandum, that herein petitioner and the rest of
her co-respondents be held guilty of Grave Misconduct for which they should be meted a penalty of
SIX (6) MONTHS SUSPENSION.
Aportadera’s recommendation was approved by the Ombudsman on June 16, 2000. A motion for
reconsideration of this June 16, 2000 – approved Memorandum Review having been denied by the
Memorandum Review of July 19, 2000 which the Ombudsman approved on July 28,
2000,15 petitioner filed on October 4, 2000 a petition with this Court for certiorari and prohibition with
prayer for a temporary restraining order (TRO) and/or writ of preliminary injunction, docketed as G.
R. No. 145000, seeking the nullification of the Ombudsman’s above-said Memorandum Reviews.
By Resolution of October 16, 2000, this Court dismissed the petition for having been brought to the
wrong forum in light of the ruling in Fabian v. Desierto16 that appeals from the decision of the
Ombudsman should be made to the Court of Appeals by a petition for review under Rule 43 of the
1997 Rules of Civil Procedure. Unlike the Fabian, this Court did not order the transfer of the petition
to the Court of Appeals for proper disposition pursuant to this Court’s Resolution in A. M. No. 99-2-
02-SC dated February 9, 1999 declaring that any appeal filed with this Court after March 15, 1999
from a decision, resolution or order of the Ombudsman in an administrative case would no longer
be referred to the Court of Appeals. Petitioner’s Motion for Reconsideration of this Court’s October
16, 2000 Resolution was denied on January 22, 2001.
Petitioner thus elevated the Ombudsman’s Memorandum Reviews to the Court of Appeals by a
petition for review filed on April 18, 2001, docketed as CA-G. R. SP No. 64332. By Resolution of
May 2, 2001,17 however, the Court of Appeals dismissed the petition for having been filed beyond the
fifteen-day reglementary period, reckoned from petitioner’s receipt of the Ombudsman’s second
Memorandum Review on August 7, 2000.
Petitioner filed a Motion for Reconsideration of the May 2, 2001 Resolution of the Court of Appeals.
Pending resolution thereof or on July 6, 2001, petitioner filed a motion for leave to submit a copy of
the COA Decision No. 2001-11 dated June 21 200118 which lifted the audit disallowance of the
payments made for the purchases by the NKTI of the "Terumo" blood bags from FVA. In said
decision, the COA held that the purchase of blood bags without public bidding was not violative of
the law, was not disadvantageous to the government, and did not accord undue preference to FVA.
In a Resolution of November 21, 2001,19 the Court of Appeals denied petitioner’s Motion for
Reconsideration.
Hence, the present petition for review on certiorari with an application for a TRO and/or an injunctive
writ which was filed on December 21, 2001. Public respondents filed their Comment,20 to which
petitioner filed her Reply.21
Petitioner imputes to the Court of Appeals the commission of grave error in dismissing her petition
for review on a mere technicality. She invokes considerations of substantial justice for this Court to
give her petition due course and essentially prays that the Resolutions of the Court of Appeals be set
aside and that the Memorandum Reviews of the Ombudsman be nullified.
During the pendency of the present petition or on March 14, 2002, petitioner filed a motion22 to grant
her leave to file a Manifestation informing that this Court rendered on December 14, 2001 a
decision23 in G. R. No. 142738, "Dr. Honorata Baylon v. Office of the Ombudsman and
Sandiganbayan," reversing and setting aside the Ombudsman’s February 28, 2000 Resolution
finding probable cause to criminally prosecute her before the Sandiganbayan arising from the same
acts subject of the Ombudsman’s Memorandum Reviews finding her administratively liable, and that
the said decision "be considered persuasive to the instant proceeding." At the same time, petitioner
filed the Manifestation.24
By Resolution of April 10, 2002, this Court Resolved to
(a) GRANT the motion of petitioner to admit the copy of the court’s decision in G. R. No.
142738 through a manifestation as said decision of December 14, 2001 should be
considered persuasive to the instant proceeding; and
(b) NOTE the said manifestation.
Petitioner submits that the dismissal by the Court of Appeals of her petition for review by mere
technicality would cause a miscarriage of justice for, so she contends, she has raised meritorious
arguments, adduced evidence, and presented special circumstances proving her innocence of the
charge of grave misconduct.
This Court finds that the Court of Appeals correctly dismissed petitioner’s petition for review for
having been filed beyond the reglementary period.
The correctness of the Court of Appeals’ dismissal of petitioner’s petition for review notwithstanding,
this Court cannot write finis to the case at bar by the strict application of the rules of procedure
governing appeals. For judicial cases do not come and go through the portals of a court of law by the
mere mandate of technicalities.
After going over all the pleadings, evidence, and all other documents bearing on this case, this Court
has resolved to spare the present petition from dismissal to which it should have been consigned as
a matter of procedure.
The allowance of the filing of appeals or actions even when everything is lost due to non-compliance
with rules or technicalities is not a novel phenomenon for this Court. In the case of Cortes v. Court of
Appeals,25 counsel for a party in a case before the trial court failed to withdraw his appearance as
such when he was appointed as judge of the Dumaguete Regional Trial Court in January 1983.
Thus, after the lower court rendered a decision on February 16, 1983, the same was served on
February 28, 1983 upon said counsel, who was then in his judicial station, at his Cebu City address.
Having learned of the decision only on March 8, 1983, he immediately informed his client who
learned of the adverse judgment a few days later after being out on official business. On March 22,
1983, the concerned party’s new counsel accordingly filed a notice of appeal which the lower court
denied due course for having been filed beyond the 15-day reglementary period. This Court ruled
that the seven-day delay did not warrant the outright dismissal of the appeal, taking into account the
peculiar circumstances of the case and the appeal’s ostensible merit.
Likewise, in Legasto v. Court of Appeals,26 a decision in an action for ejectment was rendered
against therein private respondents by the Metropolitan Trial Court and the Regional Trial Court.
Appeal via a petition for review was subsequently filed with the Court of Appeals which initially
dismissed the petition for having been filed two days beyond the reglementary period. On motion for
reconsideration, however, the Court of Appeals gave due course to the appeal after accepting
counsel’s explanation that the making of the petition was delayed by brownouts. Declaring that a
delay in the filing of an appeal under exceptional circumstances may be excused on grounds of
substantial justice and equity, this Court affirmed the Court of Appeals decision to give due course to
the belated appeal as it raised an important legal question bearing upon many similarly situated
tenants and landlords in the country.
The same failure to file an appeal on time was excused in Philippine National Bank v. Court of
Appeals27 where this Court allowed an appeal filed three days late in the higher interest of justice, as
barring the said appeal would be inequitable and unjust in light of certain circumstances therein.
The foregoing jurisprudence and similar other cases indeed constitute a testament to what C. Viuda
de Ordoveza v. Raymundo28 described as ". . . the power of the court to suspend its own rules, or to
except a particular case from its operation, whenever the purposes of justice require it." Ginete v.
Court of Appeals29 specifically laid down the range of reasons which may provide justifications for a
court to resist a strict adherence to procedure, enumerating, thus, the following elements for an
appeal to be given due course by a suspension of the enforcement of procedural rules: (1) matters
of life, liberty, honor or property; (2) counsel’s negligence without any participatory negligence on the
part of the client; (3) the existence of special or compelling circumstances; (4) the merits of the case;
(5) a cause not entirely attributable to the fault or negligence of the party favored by the suspension
of the rules; (6) a lack of any showing that the review sought is merely frivolous and dilatory; and (7)
the other party will not be unjustly prejudiced thereby.
We find attendant in the case at bar transcendental considerations which outweigh rules of
procedure thereby providing justification for the suspension of their application. Petitioner’s evidence
and arguments in support of her claim of innocence of the charge of grave misconduct have indeed
cast doubt on the veracity of the Ombudsman’s factual conclusions in the subject administrative
case against her. We cannot thus simply brush aside petitioner’s protestations of lack of
administrative culpability for the sake of sticking to technicalities when the merits of her cause are
crying out for proper judicial determination.
The tardiness of the appeal of petitioner before the Court of Appeals undoubtedly stemmed from her
counsel’s faux pas in the remedy pursued to assail the Ombudsman’s questioned Memorandum
Reviews. In the normal course of things, petitioner would have been covered by the general rule that
a client is bound by the negligence or mistakes of his counsel. Yet, the patent merits of petitioner’s
cause for the nullification of her suspension from public office nag the Court towards the realization
that to deny her the instant petition now based merely on the fiction that the counsel’s negligence
binds the client is to unjustly seal petitioner’s fate without the benefit of a review of the correctness
and justness of her imposed administrative liability. Hers, thus, is a case of an extremely different
kind; the exception to the rule on the effects of the counsel’s mistake or negligence, for the
application of the rule would result in serious injustice30 to petitioner. Especially in this case where
she had nothing to do with her counsel’s mistake and negligence, thus clearly falling within the ambit
of the reasons provided for by Ginete for the relaxation of the rules.
This Court takes note of special circumstances relative to the case at bar. The Decision of this Court
in G. R. No. 142738 categorically declared the lack of probable cause to indict petitioner for
the same acts constitutive of the administrative charge against her, hence, it ordered the
Sandiganbayan to dismiss the criminal case against petitioner and her co-accused. In the same
vein, the COA Decision No. 2001-11 found no irregularity in the purchases by the NKTI of the blood
bags from FVA and thus it lifted its previous disallowance of the payments to said purchases. Such
determinations in favor of petitioner by other fora, independent they may be from the administrative
action against her, serve as added reasons to warrant the taking of a hard look at the Ombudsman’s
Memorandum Reviews.
Suspension from public office is a serious incident that definitely blemishes a person’s record in
government service. It is an injury to one’s reputation and honor which produces irreversible effects
on one’s career and private life. If only to assure the judicial mind that no injustice is allowed to take
place due to a blind adherence to rules of procedure, the dismissal on technicality of petitioner’s
action, which is aimed at establishing not just her innocence but the truth, cannot stand. That the
Ombudsman’s Memorandum Reviews may have attained finality due to petitioner’s belated appeal
therefrom to the Court of Appeals does not preclude a modification or an alteration thereof, for if the
execution of a decision becomes impossible or unjust, it may be modified or altered to harmonize it
with justice and the facts.31
On the suspension of the enforcement of procedural rules to give way to matters of greater value,
this Court could not have more eloquently defined its stance, thus:
In the interest of substantial justice, procedural rules of the most mandatory character in terms of
compliance, may be relaxed. In other words, if strict adherence to the letter of the law would result in
absurdity and manifest injustice or where the merit of a party’s cause is apparent and outweighs
consideration of non-compliance with certain formal requirements, procedural rules should definitely
be liberally construed. A party-litigant is to be given the fullest opportunity to establish the merits of
his complaint or defense rather than for him to lose life, liberty, honor or property on mere
technicalities.32 x x x
Prescinding from the foregoing, the Court resolved to give due course to the present petition and set
aside the challenged Resolutions of May 2, 2001 and November 21, 2001 of the Court of Appeals.
We will not, however, remand the case to the appellate court, a remand not being necessary where,
as in this case, We are in a position to resolve the dispute based on the records before it and the
ends of justice would not be subserved thereby.33
While factual findings of administrative and quasi-judicial agencies are generally accorded not only
respect but at times finality,34 this holds true only when they are supported by substantial evidence.
The Ombudsman’s finding in its questioned Memorandum Reviews that petitioner is guilty of grave
misconduct was anchored principally on the fact that FVA sold the same "Terumo" blood bags to
PNRC and the Mother Seaton and Our Lady of Fatima blood banks at lower prices. Such fact,
however, cannot be regarded substantial evidence proving that petitioner is guilty of grave
misconduct.
Petitioner’s countervailing evidence shows that the acquisitions of blood bags for government use
were negotiated purchases which were justified by proven reasons for their lawful execution under
Executive Order No. 30135 even without the required public bidding. It is an undisputed fact that the
blood bags were utilized for the Blood Donation Program the immediate implementation of which
program was then necessitated by circumstances of public notice so that the urgency for the blood
bags’ acquisition warranted negotiated purchase instead of by public bidding. It is undisputed that
FVA was then the sole exclusive distributor of "Terumo" blood bags, thus providing another reason
for the purchases to be exempted from public bidding.
Petitioner’s evidence too shows that the negotiated purchase was not disadvantageous to the
government, considering, among other factors, the quality of the blood bags and the price at which
they were purchased as compared to those purchased by other government hospitals, and the time
element.
The Ombudsman’s conclusion that petitioner and her co-respondents did not negotiate with FVA to
obtain the best possible terms and conditions of purchase finds no support in the evidence on
record. On the contrary, as reflected above, the NKTI through petitioner sought two quotations from
FVA for the blood bags with the second quotation offering lower prices.
In grave misconduct, the elements of corruption, clear intent to violate the law or flagrant disregard
of established rule must be manifest.36 Petitioner’s actuations in the procurement of the blood bags
were clearly antithetical to what constitutes grave misconduct.
What appears from the questioned Memorandum Reviews of the Ombudsman is that they merely
relied on the singular circumstance that certain medical institutions were allowed to purchase the
blood bags at lower prices, without taking into account petitioner’s countervailing evidence.
While substantial evidence, which is more than a mere scintilla but is such relevant evidence as a
reasonable mind might accept as adequate to support a conclusion,37 suffices to hold one
administratively liable, the substantial evidence rule does not authorize any finding to be made just
as long as there is any evidence to support it; it does not excuse administrative agencies from taking
into account countervailing evidence which fairly detracts from the evidence supporting a
finding.38 The evidence in support of the Ombudsman’s findings does not amount to substantial
evidence.
WHEREFORE, the petition at bar is hereby GRANTED. The assailed May 2, 2001 and November
21, 2001 Resolutions of the Court of Appeals, as well as the June 16, 2000 and July 28, 2000-
approved Memorandum Reviews of the Ombudsman, are hereby SET ASIDE. The respondent is
hereby ABSOLVED from any administrative liability in connection with the purchases in question.
SO ORDERED.
G.R. No. 149576 August 8, 2006

REPUBLIC OF THE PHILIPPINES, represented by the Land Registration Authority, Petitioner,
vs.
KENRICK DEVELOPMENT CORPORATION, Respondent.
DECISION
CORONA, J.:
The Republic of the Philippines assails the May 31, 2001 decision 1 and August 20, 2001 resolution
of the Court of Appeals in CA-G.R. SP No. 52948 in this petition for review under Rule 45 of the
Rules of Court.
This case stemmed from the construction by respondent Kenrick Development Corporation of a
concrete perimeter fence around some parcels of land located behind the Civil Aviation Training
Center of the Air Transportation Office (ATO) in 1996. As a result, the ATO was dispossessed of
some 30,228 square meters of prime land. Respondent justified its action with a claim of ownership
over the property. It presented Transfer Certificate of Title (TCT) Nos. 135604, 135605 and 135606
issued in its name and which allegedly originated from TCT No. 17508 registered in the name of one
Alfonso Concepcion.
ATO verified the authenticity of respondent’s titles with the Land Registration Authority (LRA). On
May 17, 1996, Atty. Jose Loriega, head of the Land Title Verification Task Force of the LRA,
submitted his report. The Registrar of Deeds of Pasay City had no record of TCT No. 17508 and its
ascendant title, TCT No. 5450. The land allegedly covered by respondent’s titles was also found to
be within Villamor Air Base (headquarters of the Philippine Air Force) in Pasay City.
By virtue of the report, the Office of the Solicitor General (OSG), on September 3, 1996, filed a
complaint for revocation, annulment and cancellation of certificates of title in behalf of the Republic
of the Philippines (as represented by the LRA) against respondent and Alfonso Concepcion. It was
raffled to Branch 114 of the Regional Trial Court of Pasay City where it was docketed as Civil Case
No. 96-1144.
On December 5, 1996, respondent filed its answer which was purportedly signed by Atty. Onofre
Garlitos, Jr. as counsel for respondent.
Since Alfonso Concepcion could not be located and served with summons, the trial court ordered the
issuance of an alias summons by publication against him on February 19, 1997.
The case was thereafter punctuated by various incidents relative to modes of discovery, pre-trial,
postponements or continuances, motions to dismiss, motions to declare defendants in default and
other procedural matters.
During the pendency of the case, the Senate Blue Ribbon Committee and Committee on Justice and
Human Rights conducted a hearing in aid of legislation on the matter of land registration and titling.
In particular, the legislative investigation looked into the issuance of fake titles and focused on how
respondent was able to acquire TCT Nos. 135604, 135605 and 135606.
During the congressional hearing held on November 26, 1998, one of those summoned was Atty.
Garlitos, respondent’s former counsel. He testified that he prepared respondent’s answer and
transmitted an unsigned draft to respondent’s president, Mr. Victor Ong. The signature appearing
above his name was not his. He authorized no one to sign in his behalf either. And he did not know
who finally signed it.
With Atty. Garlitos’ revelation, the Republic promptly filed an urgent motion on December 3, 1998 to
declare respondent in default, 2 predicated on its failure to file a valid answer. The Republic argued
that, since the person who signed the answer was neither authorized by Atty. Garlitos nor even
known to him, the answer was effectively an unsigned pleading. Pursuant to Section 3, Rule 7 of the
Rules of Court, 3 it was a mere scrap of paper and produced no legal effect.
On February 19, 1999, the trial court issued a resolution granting the Republic’s motion. 4 It found
respondent’s answer to be sham and false and intended to defeat the purpose of the rules. The trial
court ordered the answer stricken from the records, declared respondent in default and allowed the
Republic to present its evidence ex parte.
The Republic presented its evidence ex parte, after which it rested its case and formally offered its
evidence.
Meanwhile, respondent sought reconsideration of the February 19, 1999 resolution but the trial court
denied it.
Aggrieved, respondent elevated the matter to the Court of Appeals via a petition for
certiorari 5 seeking to set aside the February 19, 1999 resolution of the trial court. Respondent
contended that the trial court erred in declaring it in default for failure to file a valid and timely
answer.
On May 31, 2001, the Court of Appeals rendered the assailed decision. It found Atty. Garlitos’
statements in the legislative hearing to be unreliable since they were not subjected to cross-
examination. The appellate court also scrutinized Atty. Garlitos’ acts after the filing of the
answer 6 and concluded that he assented to the signing of the answer by somebody in his stead.
This supposedly cured whatever defect the answer may have had. Hence, the appellate court
granted respondent’s petition for certiorari. It directed the lifting of the order of default against
respondent and ordered the trial court to proceed to trial with dispatch. The Republic moved for
reconsideration but it was denied. Thus, this petition.
Did the Court of Appeals err in reversing the trial court’s order which declared respondent in default
for its failure to file a valid answer? Yes, it did.
A party may, by his words or conduct, voluntarily adopt or ratify another’s statement. 7 Where it
appears that a party clearly and unambiguously assented to or adopted the statements of another,
evidence of those statements is admissible against him. 8 This is the essence of the principle of
adoptive admission.
An adoptive admission is a party’s reaction to a statement or action by another person when it is

reasonable to treat the party’s reaction as an admission of something stated or implied by the other
person. 9 By adoptive admission, a third person’s statement becomes the admission of the party
embracing or espousing it. Adoptive admission may occur when a party:
(a) expressly agrees to or concurs in an oral statement made by another; 10
(b) hears a statement and later on essentially repeats it; 11
(c) utters an acceptance or builds upon the assertion of another; 12
(d) replies by way of rebuttal to some specific points raised by another but ignores further points
which he or she has heard the other make 13 or
(e) reads and signs a written statement made by another. 14
Here, respondent accepted the pronouncements of Atty. Garlitos and built its case on them. At no
instance did it ever deny or contradict its former counsel’s statements. It went to great lengths to
explain Atty. Garlitos’ testimony as well as its implications, as follows:
1. While Atty. Garlitos denied signing the answer, the fact was that the answer was signed. Hence,
the pleading could not be considered invalid for being an unsigned pleading. The fact that the person
who signed it was neither known to Atty. Garlitos nor specifically authorized by him was immaterial.
The important thing was that the answer bore a signature.
2. While the Rules of Court requires that a pleading must be signed by the party or his counsel, it
does not prohibit a counsel from giving a general authority for any person to sign the answer for him
which was what Atty. Garlitos did. The person who actually signed the pleading was of no moment
as long as counsel knew that it would be signed by another. This was similar to addressing an
authorization letter "to whom it may concern" such that any person could act on it even if he or she
was not known beforehand.
3. Atty. Garlitos testified that he prepared the answer; he never disowned its contents and he
resumed acting as counsel for respondent subsequent to its filing. These circumstances show that
Atty. Garlitos conformed to or ratified the signing of the answer by another.
Respondent repeated these statements of Atty. Garlitos in its motion for reconsideration of the trial
court’s February 19, 1999 resolution. And again in the petition it filed in the Court of Appeals as well
as in the comment 15 and memorandum it submitted to this Court.
Evidently, respondent completely adopted Atty. Garlitos’ statements as its own. Respondent’s
adoptive admission constituted a judicial admission which was conclusive on it.
Contrary to respondent’s position, a signed pleading is one that is signed either by the party himself
or his counsel. Section 3, Rule 7 is clear on this matter. It requires that a pleading must be signed by
the party or counsel representing him.
Therefore, only the signature of either the party himself or his counsel operates to validly convert a
pleading from one that is unsigned to one that is signed.
Counsel’s authority and duty to sign a pleading are personal to him. He may not delegate it to just
any person.
The signature of counsel constitutes an assurance by him that he has read the pleading; that, to the
best of his knowledge, information and belief, there is a good ground to support it; and that it is not
interposed for delay. 16 Under the Rules of Court, it is counsel alone, by affixing his signature, who
can certify to these matters.
The preparation and signing of a pleading constitute legal work involving practice of law which is
reserved exclusively for the members of the legal profession. Counsel may delegate the signing of a
pleading to another lawyer 17 but cannot do so
in favor of one who is not. The Code of Professional Responsibility provides:
Rule 9.01 ― A lawyer shall not delegate to any unqualified person the performance of any task
which by law may only be performed by a member of the Bar in good standing.
Moreover, a signature by agents of a lawyer amounts to signing by unqualified persons, 18 something

the law strongly proscribes.
Therefore, the blanket authority respondent claims Atty. Garlitos entrusted to just anyone was void.
Any act taken pursuant to that authority was likewise void. There was no way it could have been
cured or ratified by Atty. Garlitos’ subsequent acts.
Moreover, the transcript of the November 26, 1998 Senate hearing shows that Atty. Garlitos
consented to the signing of the answer by another "as long as it conformed to his draft." We give no
value whatsoever to such self-serving statement.
No doubt, Atty. Garlitos could not have validly given blanket authority for just anyone to sign the
answer. The trial court correctly ruled that respondent’s answer was invalid and of no legal effect as
it was an unsigned pleading. Respondent was properly declared in default and the Republic was
rightly allowed to present evidence ex parte.
Respondent insists on the liberal application of the rules. It maintains that even if it were true that its
answer was supposedly an unsigned pleading, the defect was a mere technicality that could be set
aside.
Procedural requirements which have often been disparagingly labeled as mere technicalities have
their own valid raison d’ etre in the orderly administration of justice. To summarily brush them aside
may result in arbitrariness and injustice. 19
The Court’s pronouncement in Garbo v. Court of Appeals 20 is relevant:
Procedural rules are [tools] designed to facilitate the adjudication of cases. Courts and litigants alike
are thus [enjoined] to abide strictly by the rules. And while the Court, in some instances, allows a
relaxation in the application of the rules, this, we stress, was never intended to forge a bastion for
erring litigants to violate the rules with impunity. The liberality in the interpretation and application of
the rules applies only in proper cases and under justifiable causes and circumstances. While it is
true that litigation is not a game of technicalities, it is equally true that every case must be
prosecuted in accordance with the prescribed procedure to insure an orderly and speedy
administration of justice.
Like all rules, procedural rules should be followed except only when, for the most persuasive of
reasons, they may be relaxed to relieve a litigant of an injustice not commensurate with the degree
of his thoughtlessness in not complying with the prescribed procedure. 21 In this case, respondent
failed to show any persuasive reason why it should be exempted from strictly abiding by the rules.
As a final note, the Court cannot close its eyes to the acts committed by Atty. Garlitos in violation of
the ethics of the legal profession. Thus, he should be made to account for his possible misconduct.
WHEREFORE, the petition is hereby GRANTED. The May 31, 2001 decision and August 20, 2001
resolution of the Court of Appeals in CA-G.R. SP No. 52948 are REVERSED and SET ASIDE and
the February 19, 1999 resolution of the Regional Trial Court of Pasay City, Branch 114 declaring
respondent in default is hereby REINSTATED.
Let a copy of this decision be furnished the Commission on Bar Discipline of the Integrated Bar of
the Philippines for the commencement of disbarment proceedings against Atty. Onofre Garlitos, Jr.
for his possible unprofessional conduct not befitting his position as an officer of the court.
SO ORDERED.
BUILDING CARE CORPORATION / LEOPARD SECURITY & INVESTIGATION

AGENCY and/or RUPERTO PROTACIO, Petitioners, v. MYRNA
MACARAEG, Respondent.
This resolves the Petition for Review on Certiorari under Rule 45 of the Rules of Court,
praying that the Decision1 of the Court of Appeals (CA) promulgated on March 24,
Ï‚rÎ½ll
2011, and its Resolution2 dated August 19, 2011, denying petitioner's Motion for
Ï‚rÎ½ll
Reconsideration be reversed and set aside.
Petitioners are in the business of providing security services to their clients. They hired
respondent as a security guard beginning August 25, 1996, assigning her at Genato
Building in Caloocan City. However, on March 9, 2008, respondent was relieved of her
post. She was re-assigned to Bayview Park Hotel from March 9-13, 2008, but after said
period, she was allegedly no longer given any assignment. Thus, on September 9,
2008, respondent filed a complaint against petitioners for illegal dismissal,
underpayment of salaries, non-payment of separation pay and refund of cash bond.
Conciliation and mediation proceedings failed, so the parties were ordered to submit
their respective position papers.3 Ï‚rÎ½ll
Respondent claimed that petitioners failed to give her an assignment for more than nine
months, amounting to constructive dismissal, and this compelled her to file the
complaint for illegal dismissal.4 Ï‚rÎ½ll
On the other hand, petitioners alleged in their position paper that respondent was
relieved from her post as requested by the client because of her habitual tardiness,
persistent borrowing of money from employees and tenants of the client, and sleeping
on the job. Petitioners allegedly directed respondent to explain why she committed such
infractions, but respondent failed to heed such order. Respondent was nevertheless
temporarily assigned to Bayview Park Hotel from March 9-13, 2008, but she also failed
to meet said client's standards and her posting thereat was not extended. 5 Ï‚rÎ½ll
Respondent then filed an administrative complaint for illegal dismissal with the PNP-
Security Agencies and Guard Supervision Division on June 18, 2008, but she did not
attend the conference hearings for said case. Petitioners brought to the conference
hearings a new assignment order detailing respondent at the Ateneo de Manila
University but, due to her absence, petitioners failed to personally serve respondent
said assignment order. Petitioners then sent respondent a letter ordering her to report
to headquarters for work assignment, but respondent did not comply with said order.
Instead, respondent filed a complaint for illegal dismissal with the Labor Arbiter. 6 Ï‚rÎ½ll
On May 13, 2009, the Labor Arbiter rendered a Decision, the dispositive portion of
which reads as follows: chanroblesvirtuallawlibrary
WHEREFORE, judgment is hereby made dismissing the charge of illegal dismissal as

wanting in merit but, as explained above, ordering the Respondents Leopard Security
and Investigation Agency and Rupert Protacio to pay complainant a financial assistance
in the amount of P5,000.00.
Other claims are DISMISSED for lack of merit.
SO ORDERED.7 Ï‚rÎ½ll
Respondent then filed a Notice of Appeal with the National Labor Relations Commission
(NLRC), but in a Decision dated October 23, 2009, the NLRC dismissed the appeal for
having been filed out of time, thereby declaring that the Labor Arbiter's Decision had
become final and executory on June 16, 2009. 8 Ï‚rÎ½ll
Respondent elevated the case to the CA via a petition for certiorari, and on March 24,
2011, the CA promulgated its Decision, the dispositive portion of which reads as
follows:chanroblesvirtuallawlibrary
WHEREFORE, the petition for certiorari is GRANTED. The Decision dated October 23,
2009 and Resolution dated March 2, 2010 rendered by public respondent in NLRC LAC
No. 07-001892-09 (NLRC Case No. NCR-09-12628-08) are REVERSED and SET ASIDE,
and in lieu thereof, a new judgment is ENTERED declaring petitioner to have been
illegally dismissed and DIRECTING private respondents to reinstate petitioner without
loss of seniority rights, benefits and privileges; and to pay her backwages and other
monetary benefits during the period of her illegal dismissal up to actual reinstatement.
Public respondent NLRC is DIRECTED to conduct further proceedings, for the sole
purpose of determining the amount of private respondent's monetary liabilities in
accordance with this decision.
SO ORDERED.9 Ï‚rÎ½ll
Petitioners' motion for reconsideration of the aforequoted Decision was denied per
Resolution dated August 19, 2011. Hence, the present petition, where the main issue
for resolution is whether the CA erred in liberally applying the rules of procedure and
ruling that respondent's appeal should be allowed and resolved on the merits despite
having been filed out of time.
The Court cannot sustain the CA's Decision.
It should be emphasized that the resort to a liberal application, or suspension of the

application of procedural rules, must remain as the exception to the well-settled
principle that rules must be complied with for the orderly administration of justice. In
Marohomsalic v. Cole,10 the Court stated:
Ï‚rÎ½ll chanroblesvirtuallawlibrary
While procedural rules may be relaxed in the interest of justice, it is well-settled that
these are tools designed to facilitate the adjudication of cases. The relaxation of
procedural rules in the interest of justice was never intended to be a license for erring
litigants to violate the rules with impunity. Liberality in the interpretation and
application of the rules can be invoked only in proper cases and under justifiable causes
and circumstances. While litigation is not a game of technicalities, every case must be
prosecuted in accordance with the prescribed procedure to ensure an orderly and
speedy administration of justice.11 Ï‚rÎ½ll
The later case of Daikoku Electronics Phils., Inc. v. Raza, 12 further explained that:
To be sure, the relaxation of procedural rules cannot be made without any valid reasons
proffered for or underpinning it. To merit liberality, petitioner must show reasonable
cause justifying its non-compliance with the rules and must convince the Court that the
outright dismissal of the petition would defeat the administration of substantial justice.
x x x The desired leniency cannot be accorded absent valid and compelling reasons for
such a procedural lapse. x x x
We must stress that the bare invocation of "the interest of substantial justice" line is
not some magic want that will automatically compel this Court to suspend procedural
rules. Procedural rules are not to be belittled, let alone dismissed simply because their
non-observance may have resulted in prejudice to a party's substantial rights. Utter
disregard of the rules cannot be justly rationalized by harping on the policy of liberal
construction.13Ï‚rÎ½ll
In this case, the justifications given by the CA for its liberality by choosing to overlook
the belated filing of the appeal are, the importance of the issue raised, i.e., whether
respondent was illegally dismissed; and the belief that respondent should be "afforded
the amplest opportunity for the proper and just determination of his cause, free from
the constraints of technicalities,"14 considering that the belated filing of respondent's
Ï‚rÎ½ll
appeal before the NLRC was the fault of respondent's former counsel. Note, however,
that neither respondent nor her former counsel gave any explanation or reason citing
extraordinary circumstances for her lawyer's failure to abide by the rules for filing an
appeal. Respondent merely insisted that she had not been remiss in following up her
case with said lawyer.
It is, however, an oft-repeated ruling that the negligence and mistakes of counsel bind
the client. A departure from this rule would bring about never-ending suits, so long as
lawyers could allege their own fault or negligence to support the clients case and obtain
remedies and reliefs already lost by the operation of law. 15 The only exception would
Ï‚rÎ½ll
be, where the lawyer's gross negligence would result in the grave injustice of depriving
his client of the due process of law.16 In this case, there was no such deprivation of due
Ï‚rÎ½ll
process. Respondent was able to fully present and argue her case before the Labor
Arbiter. She was accorded the opportunity to be heard. Her failure to appeal the Labor
Arbiter's Decision cannot, therefore, be deemed as a deprivation of her right to due
process. In Heirs of Teofilo Gaudiano v. Benemerito, 17 the Court ruled, thus:
The perfection of an appeal within the period and in the manner prescribed by law is
jurisdictional and non-compliance with such legal requirements is fatal and has the
effect of rendering the judgment final and executory. The limitation on the period of
appeal is not without reason. They must be strictly followed as they are considered
indispensable to forestall or avoid unreasonable delays in the administration of justice,
to ensure an orderly discharge of judicial business, and to put an end to controversies.
xxx
xxxx
The right to appeal is not a natural right or part of due process; it is merely a statutory
privilege and may be exercised only in the manner and in accordance with the
provisions of law. Thus, one who seeks to avail of the right to appeal must strictly
comply with the requirements of the rules, and failure to do so leads to the loss of the
right to appeal."18 Ï‚rÎ½ll
In Ocampo v. Court of Appeals (Former Second Division), 19 the Court declared that: Ï‚rÎ½ll chanroblesvirtuallawlibrary
x x x we cannot condone the practice of parties who, either by their own or their
counsel's inadvertence, have allowed a judgment to become final and executory and,
after the same has become immutable, seek iniquitous ways to assail it. The finality of
a decision is a jurisdictional event which cannot be made to depend on the convenience
of the parties.20
Ï‚rÎ½ll
Clearly, allowing an appeal, even if belatedly filed, should never be taken lightly. The
judgment attains finality by the lapse of the period for taking an appeal without such
appeal or motion for reconsideration being filed. 21 In Ocampo v. Court of Appeals
Ï‚rÎ½ll
(Former Second Division),22 the Court reiterated the basic rule that "when a party to an
Ï‚rÎ½ll
original action fails to question an adverse judgment or decision by not filing the proper
remedy within the period prescribed by law, he loses the right to do so, and the
judgment or decision, as to him, becomes final and binding." 23 The Decision of the Ï‚rÎ½ll
Labor Arbiter, therefore, became final and executory as to respondent when she failed
to file a timely appeal therefrom. The importance of the concept of finality of judgment
cannot be gainsaid. As elucidated in Pasiona, Jr. v. Court of Appeals, 24 to wit: Ï‚rÎ½ll chanroblesvirtuallawlibrary
The Court re-emphasizes the doctrine of finality of judgment. In Alcantara v. Ponce, the
Court, citing its much earlier ruling in Arnedo v. Llorente, stressed the importance of
said doctrine, to wit: chanroblesvirtuallawlibrary
x x x controlling and irresistible reasons of public policy and of sound practice in the
courts demand that at the risk of occasional error, judgments of courts determining
controversies submitted to them should become final at some definite time fixed by
law, or by a rule of practice recognized by law, so as to be thereafter beyond the
control even of the court which rendered them for the purpose of correcting errors of
fact or of law, into which, in the opinion of the court it may have fallen. The very
purpose for which the courts are organized is to put an end to controversy, to decide
the questions submitted to the litigants, and to determine the respective rights of the
parties. With the full knowledge that courts are not infallible, the litigants submit their
respective claims for judgment, and they have a right at some time or other to have
final judgment on which they can rely as a final disposition of the issue submitted, and
to know that there is an end to the litigation.
xxxx
It should also be borne in mind that the right of the winning party to enjoy the finality
of the resolution of the case is also an essential part of public policy and the orderly
administration of justice. Hence, such right is just as weighty or equally important as
the right of the losing party to appeal or seek reconsideration within the prescribed
period.25 Ï‚rÎ½ll
When the Labor Arbiter's Decision became final, petitioners attained a vested right to
said judgment. They had the right to fully rely on the immutability of said Decision. In
Sofio v. Valenzuela,26 it was amply stressed that:
The Court will not override the finality and immutability of a judgment based only on
the negligence of a partys counsel in timely taking all the proper recourses from the
judgment. To justify an override, the counsels negligence must not only be gross but
must also be shown to have deprived the party the right to due process.
In sum, the Court cannot countenance relaxation of the rules absent the showing of
extraordinary circumstances to justify the same. In this case, no compelling reasons
can be found to convince this Court that the CA acted correctly by according respondent
such liberality.
IN VIEW OF THE FOREGOING, the Petition is GRANTED. The Decision of the Court of
Appeals dated March 24, 2011, and its Resolution dated August 19, 2011 in CA-G.R. SP
No. 114822 are hereby SET ASIDE, and the Decision of the National Labor Relations
Commission in NLRC-LAC No. 07-001892-09 (NLRC Case No. NCR-09-12628-08), ruling
that the Decision of the Labor Arbiter has become final and executory, is REINSTATED.
‰lÎ¹brÎ±r
Ï‚rÎ±lÎ±Ï
SO ORDERED.
JOANIE SURPOSA UY, Petitioner, v. JOSE NGO CHUA, Respondent.
This is a Petition for Review under Rule 45 of the Rules of Court assailing the Resolution
dated 25 June 2008 of the Regional Trial Court (RTC) of Cebu City, Branch 24, which
granted the demurrer to evidence of respondent Jose Ngo Chua, resulting in the
dismissal of Special Proceeding No. 12562-CEB.
Petitioner Joanie Surposa Uy filed on 27 October 2003 before the RTC a Petition 1 for the
issuance of a decree of illegitimate filiation against respondent. The Complaint was
docketed as Special Proceeding No. 12562-CEB, assigned to RTC-Branch 24.
Petitioner alleged in her Complaint that respondent, who was then married, had an illicit
relationship with Irene Surposa (Irene). Respondent and Irene had two children,
namely, petitioner and her brother, Allan. Respondent attended to Irene when the latter
was giving birth to petitioner on 27 April 1959, and instructed that petitioner's birth
certificate be filled out with the following names: "ALFREDO F. SURPOSA" as father and
"IRENE DUCAY" as mother. Actually, Alfredo F. Surposa was the name of Irene's father,
and Ducay was the maiden surname of Irene's mother. Respondent financially
supported petitioner and Allan. Respondent had consistently and regularly given
petitioner allowances before she got married. He also provided her with employment.
When petitioner was still in high school, respondent required her to work at the Cebu
Liberty Lumber, a firm owned by his family. She was later on able to work at the
Gaisano - Borromeo Branch through respondent's efforts. Petitioner and Allan were
introduced to each other and became known in the Chinese community as respondent's
illegitimate children. During petitioner's wedding, respondent sent his brother Catalino
Chua (Catalino) as his representative, and it was the latter who acted as father of the
bride. Respondent's relatives even attended the baptism of petitioner's daughter. 2
In his Answer3 to the Complaint, filed on 9 December 2003, respondent denied that he
had an illicit relationship with Irene, and that petitioner was his daughter. 4 Hearings
then ensued during which petitioner testified that respondent was the only father she
knew; that he took care of all her needs until she finished her college education; and
that he came to visit her on special family occasions. She also presented documentary
evidence to prove her claim of illegitimate filiation. Subsequently, on 27 March 2008,
respondent filed a Demurrer to Evidence5 on the ground that the Decision dated 21
February 2000 of RTC-Branch 9 in Special Proceeding No. 8830-CEB had already been
barred by res judicata in Special Proceeding No. 12562-CEB before RTC-Branch 24.
It turned out that prior to instituting Special Proceeding No. 12562-CEB on 27 October
2003, petitioner had already filed a similar Petition for the issuance of a decree of
illegitimate affiliation against respondent. It was docketed as Special Proceeding No.
8830-CEB, assigned to RTC-Branch 9. Petitioner and respondent eventually entered into
a Compromise Agreement in Special Proceeding No. 8830-CEB, which was approved by
RTC-Branch 9 in a Decision6 dated 21 February 2000. The full contents of said Decision
reads:
Under consideration is a Compromise Agreement filed by the parties on February 18,

2000, praying that judgment be rendered in accordance therewith, the terms and
conditions of which follows:
"1. Petitioner JOANIE SURPOSA UY declares, admits and acknowledges that there is no
blood relationship or filiation between petitioner and her brother Allan on one hand and
[herein respondent] JOSE NGO CHUA on the other. This declaration, admission or
acknowledgement is concurred with petitioner's brother Allan, who although not a party
to the case, hereby affixes his signature to this pleading and also abides by the
declaration herein.
2. As a gesture of goodwill and by way of settling petitioner and her brother's (Allan)
civil, monetary and similar claims but without admitting any liability, [respondent] JOSE
NGO CHUA hereby binds himself to pay the petitioner the sum of TWO MILLION PESOS
(P2,000,000.00) and another TWO MILLION PESOS (P2,000,000.00) to her brother,
ALLAN SURPOSA. Petitioner and her brother hereby acknowledge to have received in
full the said compromise amount.
3. Petitioner and her brother (Allan) hereby declare that they have absolutely no more
claims, causes of action or demands against [respondent] JOSE NGO CHUA, his heirs,
successors and assigns and/or against the estate of Catalino Chua, his heirs, successors
and assigns and/or against all corporations, companies or business enterprises
including Cebu Liberty Lumber and Joe Lino Realty Investment and Development
Corporation where defendant JOSE NGO CHUA or CATALINO NGO CHUA may have
interest or participation.
4. [Respondent] JOSE NGO CHUA hereby waives all counterclaim or counter-demand

with respect to the subject matter of the present petition.
5. Pursuant to the foregoing, petitioner hereby asks for a judgment for the permanent
dismissal with prejudice of the captioned petition. [Respondent] also asks for a
judgment permanently dismissing with prejudice his counterclaim."
Finding the said compromise agreement to be in order, the Court hereby approves the
same. Judgment is rendered in accordance with the provisions of the compromise
agreement. The parties are enjoined to comply with their respective undertakings
embodied in the agreement.7
With no appeal having been filed therefrom, the 21 February 2000 Decision of RTC-
Branch 9 in Special Proceeding 8830-CEB was declared final and executory.
Petitioner filed on 15 April 2008 her Opposition 8 to respondent's Demurrer to Evidence
in Special Proceeding No. 12562-CEB. Thereafter, RTC-Branch 24 issued its now
assailed Resolution dated 25 June 2008 in Special Proceeding No. 12562-CEB, granting
respondent's Demurrer.
RTC-Branch 24 summarized the arguments of respondent and petitioner in the

Demurrer and Opposition, respectively, as follows:
This is to resolve the issues put across in the Demurrer to the Evidence submitted to
this Court; the Opposition thereto; the Comment on the Opposition and the Rejoinder
to the Comment.
xxx
1. The instant case is barred by the principle of res judicata because there was a
judgment entered based on the Compromise Agreement approved by this multiple-sala
Court, branch 09, on the same issues and between the same parties.
2. That such decision of Branch 09, having attained finality, is beyond review, reversal
or alteration by another Regional Trial Court and not even the Supreme Court, no
matter how erroneous.
3. Judicial Admissions or admission in petitioner's pleadings to the effect that there is
no blood relationship between petitioner and respondent, which is a declaration against
interest, are conclusive on her and she should not be permitted to falsify.
4. That the Certificate of Live Birth showing that petitioner's father is Alfredo Surposa is
a public document which is the evidence of the facts therein stated, unless corrected by
judicial order.
5. After receiving the benefits and concessions pursuant to their compromise

agreement, she is estopped from refuting on the effects thereof to the prejudice of the
[herein respondent].
The summary of the Opposition is in this wise:
1. That the illegitimate filiation of petitioner to respondent is established by the open,

and continuous possession of the status of an illegitimate child.
2. The Demurrer to the evidence cannot set up the affirmative grounds for a Motion to
Dismiss.
3. The question on the civil status, future support and future legitime can not be
subject to compromise.
4. The decision in the first case does not bar the filing of another action asking for the
same relief against the same defendant. 9
Taking into consideration the aforementioned positions of the parties, RTC-Branch 24

held that:
Looking at the issues from the viewpoint of a judge, this Court believes that its hands
are tied. Unless the Court of Appeals strikes down the Compromise Judgment rendered
by Branch 09 of the Regional Trial Court of Cebu City, this Court will not attempt to
vacate, much more annul, that Judgment issued by a co-equal court, which had long
become final and executory, and in fact executed.
This court upholds the Policy of Judicial Stability since to do otherwise would result in
patent abuse of judicial discretion amounting to lack of jurisdiction. The defense of lack
of jurisdiction cannot be waived. At any rate, such is brought forth in the Affirmative
Defenses of the Answer.
This Court, saddled with many cases, suffers the brunt of allowing herein case involving
same parties to re-litigate on the same issues already closed. 10
In the end, RTC-Branch 24 decreed:
WHEREFORE, in view of the foregoing, the Demurrer to the Evidence is hereby given
due course, as the herein case is hereby ordered DISMISSED. 11
RTC-Branch 24 denied petitioner's Motion for Reconsideration 12 in a Resolution13 dated

29 July 2008.
Petitioner then filed the instant Petition raising the following issues for resolution of this
Court:
I
Whether or not the principle of res judicata is applicable to judgments predicated upon
a compromise agreement on cases enumerated in Article 2035 of the Civil Code of the
Philippines;
II
Whether or not the compromise agreement entered into by the parties herein before
the Regional Trial Court, Branch 09 of Cebu City effectively bars the filing of the present
case.14
At the outset, the Court notes that from the RTC Resolution granting respondent's
Demurrer to Evidence, petitioner went directly to this Court for relief. This is only
proper, given that petitioner is raising pure questions of law in her instant Petition. Ï‚Î·Î±Ã±rÎ¿blÎµÅ¡ Î½Î¹râ€ Ï…Î±l lÎ±Ï‰ lÎ¹brÎ±rÃ ¿
Section 1, Rule 45 of the Rules of Court provides:
SECTION 1. Filing of petition with Supreme Court. - A party desiring to appeal

by certiorari from a judgment or final order or resolution of the Court of Appeals, the
Sandiganbayan, the Regional Trial Court or other courts whenever authorized by law,
may file with the Supreme Court a verified Petition for Review on Certiorari . The
petition shall raise only questions of law which must be distinctly set forth.
Clearly, a party may directly appeal to this Court from a decision or final order or
resolution of the trial court on pure questions of law. A question of law lies, on one
hand, when the doubt or difference arises as to what the law is on a certain set of
facts; a question of fact exists, on the other hand, when the doubt or difference arises
as to the truth or falsehood of the alleged facts. Here, the facts are not disputed; the
controversy merely relates to the correct application of the law or jurisprudence to the
undisputed facts.15
The central issue in this case is whether the Compromise Agreement entered into
between petitioner and respondent, duly approved by RTC-Branch 9 in its Decision
dated 21 February 2000 in Special Proceeding No. 8830-CEB, constitutes res judicata in
Special Proceeding No. 12562-CEB still pending before RTC-Branch 24. Ï‚Î·Î±Ã±rÎ¿blÎµÅ¡ Î½Î¹râ€ Ï…Î±l lÎ±Ï‰ lÎ¹brÎ±rÃ¿
The doctrine of res judicata is a rule that pervades every well - regulated system of
jurisprudence and is founded upon two grounds embodied in various maxims of the
common law, namely: (1) public policy and necessity, which makes it in the interest of
the State that there should be an end to litigation, interest reipublicae ut sit finis litium,
and (2) the hardship of the individual that he should be vexed twice for the same
cause, nemo debet bis vexari pro eadem causa.16
For res judicata, to serve as an absolute bar to a subsequent action, the following

requisites must concur: (1) there must be a final judgment or order; (2) the court
rendering it must have jurisdiction over the subject matter and the parties; (3) it must
be a judgment or order on the merits; and (4) there must be, between the two cases,
identity of parties, subject matter, and causes of action. 17
It is undeniable that Special Proceeding No. 8830-CEB, previously before RTC-Branch 9,

and Special Proceeding No. 12562-CEB, presently before RTC-Branch 24, were both
actions for the issuance of a decree of illegitimate filiation filed by petitioner against
respondent. Hence, there is apparent identity of parties, subject matter, and causes of
action between the two cases. However, the question arises as to whether the other
elements of res judicata exist in this case.
The court rules in the negative.
A compromise is a contract whereby the parties, by making reciprocal concessions,

avoid a litigation or put an end to one already commenced. 18 In Estate of the late Jesus
S. Yujuico v. Republic,19 the Court pronounced that a judicial compromise has the effect
of res judicata. A judgment based on a compromise agreement is a judgment on the
merits.
It must be emphasized, though, that like any other contract, a compromise agreement
must comply with the requisites in Article 1318 of the Civil Code, to wit: (a) consent of
the contracting parties; (b) object certain that is the subject matter of the contract; and
(c) cause of the obligation that is established. And, like any other contract, the terms
and conditions of a compromise agreement must not be contrary to law, morals, good
customs, public policy and public order. Any compromise agreement that is contrary to
law or public policy is null and void, and vests no rights in and holds no obligation for
any party. It produces no legal effect at all.20
In connection with the foregoing, the Court calls attention to Article 2035 of the Civil
Code, which states:
ART. 2035. No compromise upon the following questions shall be valid:
(1) The civil status of persons;
(2) The validity of a marriage or a legal separation;
(3) Any ground for legal separation;
(4) Future support;
(5) The jurisdiction of courts;
(6) Future legitime. (Emphases ours.)
The Compromise Agreement between petitioner and respondent, executed on 18

February 2000 and approved by RTC-Branch 9 in its Decision dated 21 February 2000
in Special Proceeding No. 8830-CEB, obviously intended to settle the question of
petitioner's status and filiation, i.e., whether she is an illegitimate child of respondent.
In exchange for petitioner and her brother Allan acknowledging that they are not the
children of respondent, respondent would pay petitioner and Allan P2,000,000.00 each.
Although unmentioned, it was a necessary consequence of said Compromise Agreement
that petitioner also waived away her rights to future support and future legitime as an
illegitimate child of respondent. Evidently, the Compromise Agreement dated 18
February 2000 between petitioner and respondent is covered by the prohibition under
Article 2035 of the Civil Code.
Advincula v. Advincula21 has a factual background closely similar to the one at bar.

Manuela Advincula (Manuela) filed, before the Court of First Instance (CFI) of Iloilo,
Civil Case No. 3553 for acknowledgment and support, against Manuel Advincula
(Manuel). On motion of both parties, said case was dismissed. Not very long after,
Manuela again instituted, before the same court, Civil Case No. 5659 for
acknowledgment and support, against Manuel. This Court declared that although Civil
Case No. 3553 ended in a compromise, it did not bar the subsequent filing by Manuela
of Civil Case No. 5659, asking for the same relief from Manuel. Civil Case No. 3553 was
an action for acknowledgement, affecting a person's civil status, which cannot be the
subject of compromise.
It is settled, then, in law and jurisprudence, that the status and filiation of a child
cannot be compromised. Public policy demands that there be no compromise on the
status and filiation of a child.22 Paternity and filiation or the lack of the same, is a
relationship that must be judicially established, and it is for the Court to declare its
existence or absence. It cannot be left to the will or agreement of the parties. 23
Being contrary to law and public policy, the Compromise Agreement dated 18 February
2000 between petitioner and respondent is void ab initio and vests no rights and
creates no obligations. It produces no legal effect at all. The void agreement cannot be
rendered operative even by the parties' alleged performance (partial or full) of their
respective prestations.24
Neither can it be said that RTC-Branch 9, by approving the Compromise Agreement, in

its Decision dated 21 February 2000 in Special Proceeding No. 8830-CEB, already made
said contract valid and legal. Obviously, it would already be beyond the jurisdiction of
RTC-Branch 9 to legalize what is illegal. RTC-Branch 9 had no authority to approve and
give effect to a Compromise Agreement that was contrary to law and public policy,
even if said contract was executed and submitted for approval by both parties. RTC-
Branch 9 would not be competent, under any circumstances, to grant the approval of
the said Compromise Agreement. No court can allow itself to be used as a tool to
circumvent the explicit prohibition under Article 2035 of the Civil Code. The following
quote in Francisco v. Zandueta 25 is relevant herein:
It is a universal rule of law that parties cannot, by consent, give a court, as such,
jurisdiction in a matter which is excluded by the laws of the land. In such a case the
question is not whether a competent court has obtained jurisdiction of a party triable
before it, but whether the court itself is competent under any circumstances to
adjudicate a claim against the defendant. And where there is want of jurisdiction of the
subject-matter, a judgment is void as to all persons, and consent of parties can never
impart to it the vitality which a valid judgment derives from the sovereign state, the
court being constituted, by express provision of law, as its agent to pronounce its
decrees in controversies between its people. (7 R. C. L., 1039.)
A judgment void for want of jurisdiction is no judgment at all. It cannot be the source of
any right or the creator of any obligation. All acts performed pursuant to it and all
claims emanating from it have no legal effect. Hence, it can never become final, and
any writ of execution based on it is void. It may be said to be a lawless thing that can
be treated as an outlaw and slain on sight, or ignored wherever and whenever it
exhibits its head.26
In sum, Special Proceeding No. 12562-CEB before RTC-Branch 24 is not barred by res
judicata, since RTC-Branch 9 had no jurisdiction to approve, in its Decision dated 21
February 2000 in Special Proceeding No. 8830-CEB, petitioner and respondent's
Compromise Agreement, which was contrary to law and public policy; and,
consequently, the Decision dated 21 February 2000 in Special Proceeding No. 8830-
CEB, being null and void for having been rendered by RTC-Branch 9 without
jurisdiction, could not have attained finality or been considered a judgment on the
merits.
Nevertheless, the Court must clarify that even though the Compromise Agreement
between petitioner and respondent is void for being contrary to law and public policy,
the admission petitioner made therein may still be appreciated against her in Special
Proceeding No. 12562-CEB. RTC-Branch 24 is only reminded that while petitioner's
admission may have evidentiary value, it does not, by itself, conclusively establish the
lack of filiation.27
Proceeding from its foregoing findings, the Court is remanding this case to the RTC-
Branch 24 for the continuation of hearing on Special Proceedings No. 12562-CEB, more
particularly, for respondent's presentation of evidence.
Although respondent's pleading was captioned a Demurrer to Evidence, it was more

appropriately a Motion to Dismiss on the ground of res judicata.
Demurrer to Evidence is governed by Rule 33 of the Rules of Court, Section 1 of which

is reproduced in full below:
SECTION 1. Demurrer to evidence. - After the plaintiff has completed the presentation
of his evidence, the defendant may move for dismissal on the ground that upon the
facts and the law the plaintiff has shown no right to relief. If his motion is denied, he
shall have the right to present evidence. If the motion is granted but on appeal the
order of dismissal is reversed he shall be deemed to have waived the right to present
evidence.
Demurrer to evidence authorizes a judgment on the merits of the case without the
defendant having to submit evidence on his part, as he would ordinarily have to do, if
plaintiff's evidence shows that he is not entitled to the relief sought. Demurrer,
therefore, is an aid or instrument for the expeditious termination of an action, similar to
a motion to dismiss, which the court or tribunal may either grant or deny. 28
The Court has recently established some guidelines on when a demurrer to evidence
should be granted, thus:
A demurrer to evidence may be issued when, upon the facts and the law, the plaintiff
has shown no right to relief. Where the plaintiff's evidence together with such
inferences and conclusions as may reasonably be drawn therefrom does not warrant
recovery against the defendant, a demurrer to evidence should be sustained. A
demurrer to evidence is likewise sustainable when, admitting every proven fact
favorable to the plaintiff and indulging in his favor all conclusions fairly and reasonably
inferable therefrom, the plaintiff has failed to make out one or more of the material
elements of his case, or when there is no evidence to support an allegation necessary
to his claim. It should be sustained where the plaintiff's evidence is prima
facie insufficient for a recovery.29
The essential question to be resolved in a demurrer to evidence is whether petitioner

has been able to show that she is entitled to her claim, and it is incumbent upon RTC-
Branch 24 to make such a determination. A perusal of the Resolution dated 25 June
2008 of RTC-Branch 24 in Special Proceeding No. 12562-CEB shows that it is barren of
any discussion on this matter. It did not take into consideration any of the evidence
presented by petitioner. RTC-Branch 24 dismissed Special Proceedings No. 12562-CEB
on the sole basis of res judicata, given the Decision dated 21 February 2000 of RTC-
Branch 9 in Special Proceeding No. 8830-CEB, approving the Compromise Agreement
between petitioner and respondent. Hence, the Resolution dated 25 June 2008 of RTC-
Branch 24 should be deemed as having dismissed Special Proceeding No. 12562-CEB
on the ground of res judicata rather than an adjudication on the merits of respondent's
demurrer to evidence. Necessarily, the last line of Section 1, Rule 33 of the Rules of
Court should not apply herein and respondent should still be allowed to present
evidence before RTC-Branch 24 in Special Proceedings No. 12562-CEB.
It must be kept in mind that substantial justice must prevail. When there is a strong
showing that grave miscarriage of justice would result from the strict application of the
Rules, this Court will not hesitate to relax the same in the interest of substantial justice.
The Rules of Court were conceived and promulgated to set forth guidelines in the
dispensation of justice but not to bind and chain the hand that dispenses it, for
otherwise, courts will be mere slaves to or robots of technical rules, shorn of judicial
discretion. That is precisely why courts in rendering real justice have always been, as
they in fact ought to be, conscientiously guided by the norm that when on the balance,
technicalities take backseat against substantive rights, and not the other way around. 30
WhereforE, premises considered, the Resolution dated 25 June 2008 of the Regional
Trial Court of Cebu City, Branch 24, in Special Proceeding No. 12562-CEB is REVERSED
and set aside. This case is ordered REMANDED to the said trial court for further
proceedings in accordance with the ruling of the Court herein. No costs.
SO ORDERED.
G.R. No. 149588 September 29, 2009
FRANCISCO R. LLAMAS and CARMELITA C. LLAMAS, Petitioners,

vs.
THE HONORABLE COURT OF APPEALS, BRANCH 66 OF THE REGIONAL TRIAL COURT IN
MAKATI CITY and THE PEOPLE OF THE PHILIPPINES, Respondents.
In this petition captioned as "Annulment of Judgment and Certiorari, with Preliminary Injunction,"
petitioners assail, on the ground of lack of jurisdiction, the trial court’s decision convicting them of
"other form of swindling" penalized by Article 316, paragraph 2, of the Revised Penal Code (RPC).
The antecedent facts and proceedings that led to the filing of the instant petition are pertinently
narrated as follows:
On August 16, 1984, petitioners were charged before the Regional Trial Court (RTC) of Makati with,
as aforesaid, the crime of "other forms of swindling" in the Information,1 docketed as Criminal Case
No. 11787, which reads:
That on or about the 20th day of November, 1978, in the municipality of Parañaque, Metro Manila,
Philippines and within the jurisdiction of this Honorable Court, the above-named accused, conspiring
and confederating together and mutually helping and aiding one another, well knowing that their
parcel of land known as Lot No. 11, Block No. 6 of the Subdivision Plan (LRC) Psd 67036, Cadastral
Survey of Parañaque, LRC Record No. N-26926, Case No. 4869, situated at Barrio San Dionisio,
Municipality of Parañaque, Metro Manila, was mortgaged to the Rural Bank of Imus, did then and
there willfully, unlawfully and feloniously sell said property to one Conrado P. Avila, falsely
representing the same to be free from all liens and encumbrances whatsoever, and said Conrado P.
Avila bought the aforementioned property for the sum of ₱12,895.00 which was paid to the accused,
to the damage and prejudice of said Conrado P. Avila in the aforementioned amount of ₱12,895.00.
Contrary to law.2
After trial on the merits, the RTC rendered its Decision3 on June 30, 1994, finding petitioners guilty
beyond reasonable doubt of the crime charged and sentencing them to suffer the penalty of
imprisonment for two months and to pay the fine of ₱18,085.00 each.
On appeal, the Court of Appeals, in its February 19, 1999 Decision4 in CA-G.R. CR No. 18270,
affirmed the decision of the trial court. In its December 22, 1999 Resolution,5 the appellate court
further denied petitioners’ motion for reconsideration.
Assailing the aforesaid issuances of the appellate court, petitioners filed before this Court, on
February 11, 2000, their petition for review, docketed as G.R. No. 141208.6 The Court, however, on
March 13, 2000, denied the same for petitioners’ failure to state the material dates. Since it
subsequently denied petitioners’ motion for reconsideration on June 28, 2000,7 the judgment of
conviction became final and executory.
With the consequent issuance by the trial court of the April 19, 2001 Warrant of Arrest,8 the police
arrested, on April 27, 2001, petitioner Carmelita C. Llamas for her to serve her 2-month jail term. The
police, nevertheless, failed to arrest petitioner Francisco R. Llamas because he was nowhere to be
found.9
On July 16, 2001, petitioner Francisco moved for the lifting or recall of the warrant of arrest, raising
for the first time the issue that the trial court had no jurisdiction over the offense charged.10
There being no action taken by the trial court on the said motion, petitioners instituted, on September
13, 2001, the instant proceedings for the annulment of the trial and the appellate courts’ decisions.
The Court initially dismissed on technical grounds the petition in the September 24, 2001
Resolution,11 but reinstated the same, on motion for reconsideration, in the October 22, 2001
Resolution.12
After a thorough evaluation of petitioners’ arguments vis-à-vis the applicable law and jurisprudence,
the Court denies the petition.
In People v. Bitanga,13 the Court explained that the remedy of annulment of judgment cannot be
availed of in criminal cases, thus —
Section 1, Rule 47 of the Rules of Court, limits the scope of the remedy of annulment of judgment to
the following:
Section 1. Coverage. — This Rule shall govern the annulment by the Court of Appeals of judgments
or final orders and resolutions in civil actions of Regional Trial Courts for which the ordinary
remedies of new trial, appeal, petition for relief or other appropriate remedies are no longer available
through no fault of the petitioner.
a1f
The remedy cannot be resorted to when the RTC judgment being questioned was rendered in a
criminal case. The 2000 Revised Rules of Criminal Procedure itself does not permit such recourse,
for it excluded Rule 47 from the enumeration of the provisions of the 1997 Revised Rules of Civil
Procedure which have suppletory application to criminal cases. Section 18, Rule 124 thereof,
provides:
Sec. 18. Application of certain rules in civil procedure to criminal cases. – The provisions of Rules
42, 44 to 46 and 48 to 56 relating to procedure in the Court of Appeals and in the Supreme Court in
original and appealed civil cases shall be applied to criminal cases insofar as they are applicable
and not inconsistent with the provisions of this Rule.
There is no basis in law or the rules, therefore, to extend the scope of Rule 47 to criminal cases. As
we explained in Macalalag v. Ombudsman, when there is no law or rule providing for this remedy,
recourse to it cannot be allowed x x x.14
Here, petitioners are invoking the remedy under Rule 47 to assail a decision in a criminal case.
Following Bitanga, this Court cannot allow such recourse, there being no basis in law or in the rules.
In substance, the petition must likewise fail. The trial court which rendered the assailed decision had
jurisdiction over the criminal case.
Jurisdiction being a matter of substantive law, the established rule is that the statute in force at the
time of the commencement of the action determines the jurisdiction of the court.15 In this case, at the
time of the filing of the information, the applicable law was Batas Pambansa Bilang 129,16 approved
on August 14, 1981, which pertinently provides:
Section 20. Jurisdiction in criminal cases. — Regional Trial Courts shall exercise exclusive original
jurisdiction in all criminal cases not within the exclusive jurisdiction of any court, tribunal or body,
except those now falling under the exclusive and concurrent jurisdiction of the Sandiganbayan which
shall hereafter be exclusively taken cognizance of by the latter.
xxxx
Section 32. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit
Trial Courts in criminal cases. — Except in cases falling within the exclusive original jurisdiction of
Regional Trial Courts and of the Sandiganbayan, the Metropolitan Trial Courts, Municipal Trial
Courts, and Municipal Circuit Trial Courts shall exercise:
(1) Exclusive original jurisdiction over all violations of city or municipal ordinances committed
within their respective territorial jurisdiction; and
(2) Exclusive original jurisdiction over all offenses punishable with imprisonment of not
exceeding four years and two months, or a fine of not more than four thousand pesos, or
both such fine and imprisonment, regardless of other imposable accessory or other
penalties, including the civil liability arising from such offenses or predicated thereon,
irrespective of kind, nature, value, or amount thereof: Provided, however, That in offenses
involving damage to property through criminal negligence they shall have exclusive original
jurisdiction where the imposable fine does not exceed twenty thousand pesos.
Article 316(2) of the RPC, the provision which penalizes the crime charged in the information,
provides that —
Article 316. Other forms of swindling.—The penalty of arresto mayor in its minimum and medium
periods and a fine of not less than the value of the damage caused and not more than three times
such value, shall be imposed upon:
xxxx
2. Any person who, knowing that real property is encumbered, shall dispose of the same, although
such encumbrance be not recorded.
The penalty for the crime charged in this case is arresto mayor in its minimum and medium periods,
which has a duration of 1 month and 1 day to 4 months, and a fine of not less than the value of the
damage caused and not more than three times such value. Here, as alleged in the information, the
value of the damage caused, or the imposable fine, is ₱12,895.00. Clearly, from a reading of the
information, the jurisdiction over the criminal case was with the RTC and not the Metropolitan Trial
Court (MeTC). The MeTC could not have acquired jurisdiction over the criminal action because at
the time of the filing of the information, its jurisdiction was limited to offenses punishable with a fine
of not more than ₱4,000.00.17
WHEREFORE, premises considered, the petition is DENIED.
SO ORDERED.

Rule 1

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Rule 1 Sec 4

G.R. No. 180291 July 27, 2010

GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS) and WINSTON F. GARCIA, in his

WHETHER AN ADMINISTRATIVE TRIBUNAL MAY APPLY SUPPLETORILY THE PROVISIONS

WHETHER A DECISION THAT MAKES CONCLUSIONS OF FACTS BASED ON EVIDENCE ON

WHETHER FURTHER PROOF OF SUSBTANTIAL REDUCTION OF THE OPERATIONAL

WHETHER AN UNRULY MASS GATHERING OF TWENTY EMPLOYEES, LASTING FOR MORE

WHETHER THE CONCERTED ABANDONMENT OF EMPLOYEES OF THEIR POSTS FOR MORE

The Court finds no merit in the petition.

RENATO REYES, REPRESENTED BY RAMON REYES, PETITIONER, VS. LEOPOLDO

Respondent appealed to the DARAB. Meanwhile, respondent passed away on 13

It appears that Respondent-Appellant is listed as farmer-beneficiary of the land transfer

1. Abandonment of the landholding without the knowledge of the lessor;

3. Absence of successor or qualified heir, in case of death or permanent incapacity of

5. Acquisition by the lessee of the landholding;

6. Termination of the leasehold under Sec. 38;

7. Mutual consent of the parties; and

8. Conversion of the landholding for non-agricultural purposes subject to the conditions

Under the prevailing circumstances, we hold that Respondent-Appellant Barrios is a

1. Declaring Respondent-Appellant Leopoldo Barrios a bona fide tenant of

2. Directing the plaintiff-landowner Renato Reyes to reinstate the qualified

WHEREFORE, premises considered, the herein Motion for Reconsideration dated

2. Directing the DAR Regional Director, through the Municipal Agrarian

3. Directing Plaintiff-Appellee's successors, co-owners, and the alleged

4. Declaring the landholding fully paid by the defendant-appellant;

5. Directing the Plaintiff-Appellee's successors and co-owners to reimburse

Hence, this petition for review.

The Ruling of the Court of Appeals

It bears stressing that in administrative proceedings, as in the case at bench, the

In his petition, petitioner submits that:

1. THE COURT OF APPEALS BY RULING IN ITS QUESTIONED DECISION

2. THE COURT OF APPEALS COMMITTED GRIEVOUS LEGAL ERROR AND/OR

The Ruling of the Court

Furthermore, in compliance with the Order[23] dated 30 September 2002 of the DARAB,

Republic of the Philippines

Engr. Rodolfo S. Pangilinan

1. That Renato Reyes the landowner and Leopoldo Barrios tenant are both

3. That at present the land in question is planted to palay by the

4. That the house of Lucia Vda. De Barrios was constructed to the

5. That the qualified tenant beneficiaries [are] among the surviving

Very truly yours,

SECTION 1. Nature of Proceedings. The proceedings before the Board or its

Thus, in Reyes v. Court of Appeals,[28] the Court held:

d. Fourth step: valuation of the land covered for amortization computation;

f. Sixth step: the issuance of the Emancipation Patent. [33]

Furthermore, there are several supporting documents which a tenant-farmer must

a. Application for issuance of Emancipation Patent;

b. Applicant's (owner's) copy of Certificate of Land Transfer.

d. Certification by the President of the Samahang Nayon or by the head of farmers'

g. Xerox copy of Official Receipts or certification by the municipal treasurer showing

Clearly, respondent is not entitled to be issued an Emancipation Patent considering that

WHEREFORE, we PARTIALLY GRANT the petition. We SET ASIDE the 8 February

Rule 1 Sec 3(B)

G.R. No. 169466 May 9, 2007

DEPARTMENT OF BUDGET AND MANAGEMENT, represented by SECRETARY ROMULO L.

The antecedent facts:

Retirement Rank Monthly Pension Difference

THE COURT OF APPEALS COMMITTED A SERIOUS ERROR IN LAW IN AFFIRMING THE

A flashback at history is proper.

The contention does not commend itself for concurrence.

Then, too, is the all familiar rule that:

We are not persuaded.

ENGRACIA B. AMBERTI and Minor MARIA TERESA AMBERTI, represented by her