CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
G.R. No. L-17721 October 16, 1961
GREGORIO APELARIO, doing business under the style "GREGORIO
TRADING," plaintiff-appelleee, vs. INES CHAVEZ & COMPANY, LTD.,
doing business under the style "FIDELITY MOTOR SUPPLY
COMPANY, LTD., and INES CHAVEZ, defendants-appellants.
Appeal from a judgment on the pleadings rendered by the Court of First
Instance of Manila on June 8, 1959 in its Case No. 39822, and certified by
the Court of Appeals to this Court on the ground that only questions of law
are involved.
The record shows that on April 8, 1959, plaintiff Gregorio Apelario filed a
complaint against Ines Chavez & Company, Ltd., a limited partnership,
and its general partner, Ines Chavez. It was therein averred, in
substance, that on or about October 28, 1958, the defendant partnership
had purchased on credit from plaintiff ten sets of axle assemblies for the
sum of P2,400.00 (par. 3); that on December 6, 1958, defendant
delivered in payment to the plaintiff two postdated cash checks for
P1,200.00 each, drawn against the Philippine Bank of Commerce (par.
4); that when the checks were presented for payment, they were
dishonored for lack of funds, whereupon the defendant took back the
checks and replaced them with two other checks, also postdated, for the
same amount as before (par. 5); that these checks were also dishonored
(par. 6); that the plaintiff, on February 23, 1959, demanded payment in
cash, but defendant refused to pay (par. 7); that because of such
malicious and wilfull refusal, plaintiff had to engage the services of
counsel for an agreed fee of P750.00 (par. 8); that defendant was about
to remove and dispose of its properties with intent to defraud the plaintiff,
wherefore a writ of attachment became necessary (par. 9); and prayer
was made for judgment in favor of plaintiff and against the defendant for
the sum of P2,400.00, with legal interest from the filing of the complaint,
and for P750.00 attorney's fees, with expenses and costs. Plaintiff also
moved and duly obtained a writ of attachment.
Defendants obtained the lifting of the attachment by filing a counterbond
on April 14, 1959; and on May 7, 1959, they filed an answer admitting the
allegations of paragraphs 1 and 6 of the complaint, admitting that plaintiff
had demanded payment of P2,400, but pleaded that
defendants could not pay the plaintiff, because they have so
many accounts receivable which have not yet been paid to them,
of which fact the defendant was duly informed by the plaintiff and
thereby requested to wait a while. (R. App. p. 27)
Defendants further averred having no knowledge or information of the
allegations of paragraph 8 of the complaint concerning the attorneys'
fees; denied having performed any act of removal or disposal of its
property, branding plaintiff's allegations in paragraph 9 to be false and
malicious; and prayed for dismissal of the complaint.
Upon motion of the plaintiff, and over the objection of defendants, the trial
court rendered judgment on the pleadings, sentencing defendants to pay
P2,400, plus legal interest from the filing of the complaint; and P500
attorney's fees.
Defendants appealed, and now claim that it was error for the lower court
to have rendered judgment on the pleadings, because the answer raised
material issues.
We find no merit in the appeal. As pointed out in the judgment
complained of the defendants-appellants had admitted all the material
allegations of the complaint concerning the existence of the debt and its
non-payment. The pleaded excuse, that they had requested plaintiff to
wait because appellants' many accounts receivable had not yet been
collected, is clearly no defense, for a debtor can not delay payment due
just to suit its convenience, and the creditor is not an underwriter of his
debtor's business unless so stipulated.
The denial of the averment concerning the stipulated fees of plaintiff's
attorney tendered no genuine issue, for even without such allegations, it
was discretionary in the court to allow reasonable attorneys' fees by way
of damages, if it found just and equitable to allow their recovery (Civ.
Code, Art. 2208). In this case, allowance of such fees was justified since
defendant admitted having issued to the creditor checks without funds,
not once but twice. It is well to note the P750 attorney's fees claimed by
plaintiff were reduced to P500 only.
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 CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
Nor does the denial of the complaint's averments concerning the
fraudulent removal and disposition of defendant's property constitute a
bar to a judgment on the pleadings, since the defendant neither claimed
nor asked for any damages on account of the issuance and levy of the
writ of attachment.
WHEREFORE, the appealed judgment of the Court of First Instance is
affirmed. Costs against appellant
G.R. No. L-28140 March 19, 1970
CAPITOL MOTORS CORPORATIONS, plaintiff-appellee, vs. NEMESIO
I. YABUT, defendant-appellant.
Appeal on a question of law from the judgment of the Court of First
Instance of Rizal in its Civil Case. No. Q-9869.
On March 1, 1966, Capitol Motors Corporations filed a complaint against
Nemesio I. Yabut. It was therein averred that on April 24, 1965, the
defendant executed in favor of the plaintiff a promissory note (copy of
which was attached to the complaint) for the sum of P30,134.25, payable
in eighteen (18) equal monthly installments with interest at 12% per
annum, the first installment to become due on June 10, 1965, that it was
stipulated in the promissory note that should the defendant fail to pay two
(2) successive installments, the principal sum remaining unpaid would
immediately become due and demandable and the defendant would, by
way of attorney's fees and costs of collection, be obligated to the plaintiff
for an additional sum equivalent to 25% of the principal and interest due;
that as of February 23, 1966, the sum remaining unpaid on the
promissory note was P30,754.79, including accrued interest; that the
defendant defaulted in the payment of two (2) successive installments,
and likewise failed to pay the interest due on the promissory note; and
that in spite of demands by the plaintiff, the defendant failed and refused
to pay the said principal sum and interest due. Prayer was made that the
defendant be ordered to pay the plaintiff the sum of P30,754.79, as well
as the interest due thereon from February 23, 1966, and an additional
sum equivalent to 25% of the amount due, plus costs.
On April 27, 1966, and within the reglementary period, the defendant,
through his counsel, filed an answer which reads:
DEFENDANT through counsel alleges:
1. Paragraph 1 of the complaint is admitted.
2. Paragraphs 2, 3, 4, 5, 6 and 7 of the complaint are specifically
denied for lack of knowledge sufficient to form a belief as to the
truth thereof.
WHEREFORE, it is respectfully prayed that the Complaint be
dismissed with costs against the plaintiff.
On June 16, 1966, the plaintiff filed a motion for judgment on the
pleadings, on the ground that the defendant, not having set forth in his
answer the substance of the matters relied upon by him to support his
denial, had failed to deny specifically the material allegations of the
complaint, hence, must be deemed to have admitted them. The
defendant did not file an opposition to the motion. On September 13,
1966, after hearing on the motion, the court issued an order granting the
said motion and considering the case submitted for decision on the basis
of the pleadings; and on January 9, 1967, the court rendered judgment
granting in toto the plaintiff's prayer in its complaint.
In this appeal, defendant-appellant contends that the court a quo erred in
considering him as having failed to deny specifically the material
allegations of the complaint, and, consequently, in deciding the case on
the basis of the pleadings. Citing Moran, Comments on the Rules of
Court, Vol. I, 1963 Ed., p. 281, he argues that since Section 10, Rule 8 of
the Revised Rules of Court, recognizes three (3) modes of specific
denial, namely: (1) by specifying each material allegation of fact in the
complaint the truth of which the defendant does not admit, and, whenever
practicable, setting forth the substance of the matters which he will rely
upon to support his denial or (2) by specifying so much of an averment in
the complaint as is true and material and denying only the remainder or
(3) by stating that the defendant is without knowledge or information
sufficient to form a belief as to the truth of a material averment in the
complaint, which has the effect of a denial, and he has adopted the third
mode of specific denial, his answer tendered an issue, and, consequently
the court a quo could not render a valid judgment on the pleadings.
This appeal is without merit.
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 CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
We agree with defendant-appellant that one of the modes of specific
denial contemplated in Section 10, Rule 8, is a denial by stating that the
defendant is without knowledge or information sufficient to form a belief
as to the truth of a material averment in the complaint. The question,
however, is whether paragraph 2 of defendant-appellant's answer
constitutes a specific denial under the said rule. We do not think so.
In Warner Barnes & Co., Ltd. vs. Reyes, et al., G.R. No. L-9531, May 14,
1958 (103 Phil., 662), this Court said that the rule authorizing an answer
to the effect that the defendant has no knowledge or information sufficient
to form a belief as to the truth of an averment and giving such answer the
effect of a denial, does not apply where the fact as to which want of
knowledge is asserted, is so plainly and necessarily within the
defendant's knowledge that his averment of ignorance must be palpably
untrue. In said case the suit was one for foreclosure of mortgage, and a
copy of the deed of mortgage was attached to the complaint; thus,
according to this Court, it would have been easy for the defendants to
specifically allege in their answer whether or not they had executed the
alleged mortgage. The same thing can be said in the present case, where
a copy of the promissory note sued upon was attached to the complaint.
The doctrine in Warner Barnes & Co., Ltd. was reiterated in J. P. Juan &
Sons, Inc. vs. Lianga Industries, Inc., G.R. No. L-25137, July 28, 1969
(28 SCRA 807). And in Sy-quia vs. Marsman, G.R. No. L-23426, March
1, 1968 (22 SCRA 927), this Court said:
With regard to the plea of lack of knowledge or information set up
in paragraph 3 of the answer, this Court's decision in Warner
Barnes vs. Reyes, 103 Phil. 662, 665, is authority for the
proposition that this form of denial must be availed of with
sincerity and good faith, not for the purpose of confusing the other
party, nor for purposes of delay. Yet, so lacking in sincerity and
good faith is this part of the answer that defendants-appellants go
to the limit of denying knowledge or information as to whether
they (defendants) were in the premises (Marsman Bldg.) on
January 4, 1961, as averred in paragraph 4 of the complaint. Yet
whether such a fact was or was not true could not be unknown to
these defendants.
In National Marketing Corporation vs. De Castro, 106 Phil. 803 (1959),
this Court held:
Furthermore, in his answer to the appellee's complaint, he merely
alleged that 'he has no knowledge or information sufficient to form
a belief as to the truth of the matters contained in paragraphs 3,
4, 5 and 6 so much so that he denies specifically said
allegations.' A denial is not specific simply because it is so
qualified. (Sections 6 and 7, Rule 9; El Hogar Filipino vs. Santos
Investments, Inc., 74 Phil. 79; Baetamo vs. Amador, 74 Phil. 735;
Dacanay vs. Lucero, 76 Phil. 139; Lagrimas vs. Lagrimas, 95
Phil. 113). Material averments in a complaint, other than those as
to the amount of damage, are deemed admitted when not
specifically denied. (Section 8, Rule 9,) The court may render
judgment upon the pleadings if material averments in the
complaint are admitted. (Section 10, Rule 35; Baetamo vs.
Amador, supra, Lichauco vs. Guash, 76 Phil. 5; Lati vs. Valmores,
G.R. No. L-6877, 30 March 1954.)
It becomes evident from all the above doctrines that a mere allegation of
ignorance of the facts alleged in the complaint, is insufficient to raise an
issue; the defendant must aver positively or state how it is that he is
ignorant of the facts so alleged. (Francisco, The Revised Rules of Court
in the Philippines, Vol. I, p. 417, citing Wood vs. Staniels, 3 Code Rep.
152 and Vassalt vs. Austin, 32 Cal. 597.)
Thus, in at least two (2) cases where this Court ruled that judgment on
the pleadings was not proper, it will be seen that the reason was that in
each case the defendants did something more than merely alleging lack
of knowledge or information sufficient to form a belief. In Arrojo vs.
Caldoza, et al., G.R. No. L-17454, July 31, 1963 (8 SCRA 547), the
defendants, in their answer to the complaint for recovery of possession of
a parcel of land, did not merely allege that they had no knowledge or
information sufficient to form a belief as to the truth of the material
allegations in the complaint, but added the following: "The truth of the
matter is that the defendants have not occupied or taken any property
belonging to the plaintiff. They took possession and ownership only of the
land belonging to them, which properties were possessed and owned
originally by their predecessors-in-interest, who were the parents of the
defendants ...." In Benavides vs. Alabastro, G.R. No. L-19762, December
23, 1964 (12 SCRA 553), the defendant's answer did not only deny the
material allegations of the complaints but also set up certain special and
affirmative defenses the nature of which called for presentation of
evidence.
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 CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
There are two other reasons why the present appeal must fail. First. The
present action is founded upon a written instrument attached to the
complaint, but defendant-appellant failed to deny under oath the
genuineness and due execution of the instrument; hence, the same are
deemed admitted. (Section 8, Rule 8 of the Revised Rules of Court;
Songo vs. Sellner, 37 Phil. 254; Philippine Commercial & Industrial Bank
vs. ELRO Development Corporation, et al., G.R. No. L-30830, August 22,
1969 [29, SCRA 38]; J. P. Juan & Sons, Inc. vs. Lianga Industries,
Inc., supra.) Second. Defendant-appellant did not oppose the motion for
judgment on the pleadings filed by plaintiff appellee; neither has he filed a
motion for reconsideration of the order of September 13, 1966, which
deemed the case submitted for decision on the pleadings, or of the
decision rendered on January 9, 1967. In Santiago vs. Basilan Lumber
Company, G.R. No. L-15532, October 31, 1963 (9 SCRA 349), this Court
said:

It appears that when the plaintiff moved to have the case decided
on the pleadings, the defendant interposed no objection and has
practically assented thereto. The defendant, therefore, is deemed
to have admitted the allegations of the complaint, so that there
was no necessity for the plaintiff to submit evidence of his claim.

PREMISES CONSIDERED, the judgment appealed from is affirmed, with

cost against defendant-appellant.

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 CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
G.R. No. L-10884 March 31, 1959
PHILIPPINE NATIONAL BANK, plaintiff-appellee, vs. PHILIPPINE
LEATHER CO. INC., ET AL., defendants-appellants.
In its complaint filed in the Court of First Instance of Manila, the plaintiff
alleges that on 1 September 1952 the defendant Philippine Leather Co.,
Inc. applied for a commercial letter of credit in the sum of $14,814.80, in
U.S. currency, under the terms and conditions set forth in an application
filed by the defendants in favor of the Turner Tanning Machinery Co. of
Peabody, Massachusetts, U.S.A. to cover the full invoice value of certain
machineries and their accessories; that on 3 October 1952 the plaintiff
approved the application "subject to 30% deposit and the joint and
several signatures of Mr. Isidoro Tinoco and Mrs. Soledad L. Basa" which
conditions were complied with; that on 8 October 1952, the plaintiffs
issued Letter of Credit No. 51469 in favor of the Turner Tanning
Machinery Company; that on 15 November 1952 the Turner Tanning
Machinery Co., drew upon the letter of credit the sum of $14,549.17, U.S.
currency; that upon arrival in the Philippines of the machineries and their
accessories imported by the defendants under a trust receipt, that on 23
January 1953 the plaintiff presented to the defendants for payment the
draft drawn by the Turner Tanning Machinery Co., upon Letter of Credit
No. 51469 which was accepted by them; that after the draft had matured
on 23 April 1953 the plaintiff made numerous demands upon the
defendants to pay the amount of the draft and the charges due thereon
but the defendants failed and refused to pay; and that as of 15 October
1953, the outstanding balance of the defendants on the draft is
P22,787.79, Philippine currency, plus interest thereon at the rate of
P4.89135 daily until fully paid. It alleges further that on 30 January 1953
the defendant Philippine leather Co., Inc., applied for a commercial letter
of credit in the sum of $2,587.50, U.S. currency, under the terms and
conditions set forth in an application filed by the defendants in favor of
Bay State Chemical Co., of Boston, Massachusetts, U.S.A., to pay for the
importation of color dye; that the plaintiff approved the application
"subject to 30% deposit and the joint and several signatures of Mr. Isidoro
Tinoco and Mrs. Soledad L. Basa," which conditions were complied with;
that thereafter the plaintiff issued Letter of Credit No. 53753 in favor of
the Bay State chemical Co., that on 12 March 1953 the Bay State
Chemical Co., drew upon the letter of credit the sum of $2,482.40, U.S.
currency; that the draft drawn by the Bay State Chemical Co., was
presented by the plaintiff to the defendants for payment; that the
defendants failed and refused to pay the amount of the draft and the
charges due thereon; that because of the failure and refusal of the
defendants to pay their obligation, the plaintiff delivered the documents of
the shipment to the Luzon Brokerage Co., and requested it to claim and
store the shipment in its bonded warehouse, for which service and
storage the defendants are liable to the Luzon Brokerage Co.; that as of
15 October 1953; the outstanding balance of the defendants on the draft
is P4,503.05, Philippine currency, plus interest thereon at the rate of
P.083569 daily until fully paid.
The plaintiff prays that after hearing judgment be rendered ordering the
defendants to pay it the sum of P22,787.79, with daily interest thereon at
the rate of P4.89135 from 15 October 1953 until fully paid; 10% of the
said amount as attorney's fee; P4,503.05, with daily interest thereon at
the rate of P0.83569 from 15 October 1953 until fully paid; the amount of
storage and other charges that the Luzon Brokerage Co., would charge
the plaintiff for the handling and storage of the merchandise imported by
the defendants under Letter of Credit No. 53753; and the costs of the
suit. The plaintiff further prays that pending hearing and final judgment, a
writ of attachment be issued commanding the Sheriff of the City of Manila
to levy upon attachment on the properties of the defendants as security
for the satisfaction of any judgment that it may secure against them.
In their answer filed on 28 December 1953 the defendants admit the
plaintiff's averments except as to the correctness of the amounts due on
the two drafts, the correctness of which they were still checking, and for
that reason lacking sufficient knowledge or information to form a belief as
to the truth and veracity of the amounts due on the two drafts, they deny
the amounts claimed by the plaintiff to be due from them.
On 25 June 1954 the plaintiff filed a motion for summary judgment on the
ground that since the defendants had admitted the material averments of
its complaint except as to the correctness of the amounts due, the
defendant's answer did not tender a genuine issue. The plaintiff attached
to its motion an affidavit subscribed and sworn to by Ceferino Saavedra,
Manager of the Special Assets Department of the plaintiff, in charge of all
outstanding accounts of its debtors, stating the payments made by the
defendants on their account and the exact total amount due from them.
On 7 October 1954 the Court granted the plaintiff's motion and rendered
judgment ordering the defendants, jointly and severally, to pay
5

. . . the plaintiff in the first cause of action, the amount of
P22,787.79, with a daily interest of P4.89135 from October 15,
1953 up to full payment thereof, and 10% of the amount due for
attorney's fees. On the second cause of action, defendants shall
pay, jointly and severally, the sum of P4,503.05, with a daily
interest of P0.83569 from October 15, 1953 until full payment
thereof.
Defendants shall also pay the costs.
The defendants appealed to the Court of Appeals. The latter certified the
case to this Court for the reason that only questions of law are raised.
Rule 36 provides:
Section 1. Summary judgment for claimant. A party seeking to
recover upon a claim, counterclaim, or crossclaim or to obtain a
declaratory relief may, at any time after the pleading in answer
thereto has been served, move with affidavits for a summary
judgment in his favor upon all or any part thereof.
SEC. 3. Motion and proceedings thereon. The motion shall be
served at least ten days before the time specified for the hearing.
The adverse party prior to the day of hearing may serve opposing
affidavits. The judgment sought shall be rendered forthwith if the
pleadings, depositions, and admissions or file, together with the
affidavits, show that, except as to the amount of damages, there
is no genuine issue as to any of the material fact and that the
moving party is entitled to a judgment as a matter of law.
SEC. 5. Form of affidavits. Supporting and opposing affidavits
shall be made on personal knowledge, shall set forth such facts
as would be admissible in evidence, and shall show affirmatively
that the affiant is competent to testify to the matters stated
therein. Sworn or certified copies of all papers of parts thereof
referred to in an affidavit shall be attached thereto or served
therewith.
The defendant's answer that as to the first cause of action they
CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
. . . are still checking on the correctness of the alleged balance
outstanding against them and in favor of the plaintiff;
consequently, for lack of knowledge or information sufficient to
form a belief as to the truth and veracity of the averments
embodied in paragraph 7 thereof, they hereby specifically deny
the allegations therein stated;
and that so to the second cause of action they
. . . are checking on the veracity and correctness of the balance
allegedly outstanding in favor of the plaintiff manifested in
paragraph 6 of the same, they, by virtue thereof, specifically deny
it for lack of knowledge and belief as to the truth of the allegations
embodied in the aforestated paragraph.
does not tender a genuine issue. In fact they admit that they are indebted
to the plaintiff. As the affidavit subscribed and sworn to by the Manager of
the Special Assets Department of the plaintiff, in charge of all outstanding
accounts of its debtors, attached to the motion for summary judgment,
furnishes the Court with the payments made by the defendants on their
account and the amount due from them, which they failed to oppose by
counter affidavits, the plaintiff is entitled to summary judgment. 1
The judgment appealed from is affirmed, with costs against the
appellants.
6

G.R. No. L-49668 November 14, 1989
POLICARPIO, LUCIO, JULIAN, CATALINO, BONIFACIO, CONRADA,
DOMINGO, PAQUITA, AND LILIA, ALL SURNAMED
GALICIA, petitioners, vs. THE HON. WENCESLAO M. POLO, in his
capacity as Presiding Judge, CFI, Branch V, Samar (Calbayog City),
ZOSIMA PALAJOS, TITING LISTOJAS, ALFREDO PALAJOS,
MANUELITO ROSIALDA, respondents.
This is a petition for review on certiorari seeking to set aside the
summary judgment entered by the then Court of First Instance of Samar,
Br. V in Civil Case No. 758-CC entitled, "Policarpio, Lucio, Julian,
Catalino, Bonifacio, Conrada, Domingo, Paquita and Lilia, all surnamed
Galicia v. Zosima Palajos, Titing Listojas, Alfredo Palajos and Manuelito
Rosialda" and to order the trial court to try the above-cited case on the
merits.
The facts are undisputed.
On December 15, 1973. a complaint for forcible entry (Civil Case No. 56)
entitled "Amancio Palajos v. Policarpio, Perfecto, Victorio Julian and
Eduardo, all surnamed Galicia," was filed in the Municipal Court of
Almagro, Samar, alleging that Amancio Palajos is the owner and in actual
possession of a parcel of land located at Bacjao, Almagro, Samar, more
particularly described as follows:
A parcel of land with an area of about 4-88-00 hectares, more or
less, assessed at P 360.00 as per Tax Declaration No. 8547 in
the name of Juan Palajos, it is, however, 14.2860 hectares as per
approved survey plan, the boundaries of which are: N Pedro
Galicia and the Poblacion of Barrio Bacjao; S Emilio Carpon,
Magno Suico and Teresa Subito; and W Bernardo Ballarante
and Cenon S. Aguilar.
which he acquired by way of donation from his father, Juan Palajos. It is
further alleged that defendants (petitioners herein) forcibly entered the
northeastern portion of the said property covering an area of about 1 1/2
hectares.
The trial of the case was set several times but was postponed at the
instance of defendants (petitioners herein). For the fifth time, i.e., on July
CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
19, 1974, neither the defendants nor counsel appeared. Accordingly, the
court granted a trial ex parte on motion of plaintiffs counsel (Rollo, p. 24).
Subsequently, the municipal trial court rendered judgment against
defendants (petitioners herein), the dispositive portion of which reads:
WHEREFORE, this Court hereby renders judgment ordering
defendants Policarpio Galicia, Perfecto Galicia, Victorio Galicia,
Julian Galicia and Eduarda Galicia to restore to plaintiff Amancio
Palajos the portion of land described in par. 4 of the plaintiffs
complaint consisting of one and one-half hectares and which is
the northeastern portion of land under Tax Dec. No. 8547 as
described in paragraph 2 thereof, ordering the defendants to pay
to plaintiff a monthly rental in the amount of FIFTY PESOS (P
50.00) on the premises in question for its use and occupation
from September, 1973, up to the time when said premises is
finally restored to the plaintiff, and to pay the costs. SO
ORDERED.
On September 28, 1974, defendants filed a motion for reconsideration
and to grant a new trial but was denied in an Order dated October 24,
1974 (Rollo, p. 28).
On November 12, 1974, defendants filed a notice of appeal but the same
was likewise denied by the trial court on the ground that it was filed
beyond the reglementary period of fifteen (15) days to perfect an appeal.
For failure of the defendants to pay the rentals adjudged in the forcible
entry case (CC No. 56), a writ of execution was issued and after levy, the
deputy sheriff of Calbayog City, on August 4, 1976, sold at public auction
the real property owned by petitioners' deceased father adjoining the land
subject of the forcible entry case more particularly described as follows:
A piece of real estate consisting of coconut and cornland situated
at Bo. Bacjao, Almagro, Samar, Philippines, bounded on the
NORTH, by Isabelo Palajos; on the SOUTH, by Narciso Pajalino;
and on the WEST, by Seashore, containing an area of 2-60-00
hectares, more or less assessed at P180.00, under Tax
Declaration No. 12048, in the name of Pedro Galicia (deceased);
(Rollo, p. 30).
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 CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
On October 10, 1977, or over 14 months after the execution sale,
petitioners filed a complaint for Ownership and Damages against herein
respondents in the then Court of First Instance of Samar, 13th Judicial
District, Br. V, docketed as Civil Case No. 758-CC, alleging that they are
co-owners of a certain parcel of agricultural land (subject of the auction
sale) which they inherited from their deceased father, Pedro Galicia,
more particularly described as follows:
A parcel of coconut and corn land located at Bacjao, Almagro,
Samar, Philippines, with an area of 26,000 sq. m. and bounded
on the NORTH, by Isabelo Palajos; SOUTH, by Narciso Pauline;
EAST, by Benedicto Paulino and WEST, by Seashore covered by
Tax Declaration No. 12048 in the name of Pedro Galicia.
The complaint further alleged that pursuant to Civil Case No. 56 (forcible
entry case), respondents were able to take possession of the land in
question as said case was heard ex-parte; and that a decision was
rendered in respondents' favor and said decision was executed sometime
in 1976 (Rollo, p. 36-37).
In their Answer, respondents (defendants below) countered that they
were able to take possession of the land described in the complaint by
virtue of the decision and later, execution of the decision in the forcible
entry case, which, by petitioners' (plaintiffs below) averment in their
complaint is an admission of an existing judgment that would
constitute res judicata; that they are the lawful owners of the disputed
land the same having been subjected to levy and execution in 1975 thru
a sale in favor of respondents' predecessor-in-interest, Juan Palajos.
The issues having been enjoined, the case was set for pre-trial by
respondent judge Hon. Wenceslao M. Polo. At the pre-trial, counsel for
private respondents moved for time within which to file a motion for
summary judgment which was granted by respondent judge in his order
dated June 28, 1978.
Defendants' (private respondents herein) motion for summary judgment
was filed on July 7, 1978 (Rollo, p. 43) alleging that no genuine issue
exists in the case at bar after the pre-trial was conducted and admission
of facts were had (Rollo, p. 44), while plaintiffs (petitioners herein) filed
their opposition to the motion for summary judgment dated July 17, 1978
alleging among others, that genuine issues exist (Rollo, pp. 45-47).
On August 11, 1978, the court a quo rendered the assailed summary
judgment dismissing petitioners' complaint (Rollo, p. 48-53), the pertinent
portion of which reads:
As demonstrated by the parties, there is no question that the land
in dispute is that parcel described in paragraph 3 of the
complaint, a portion of which was a subject in a forcible entry
case before the Municipal Trial Court of Almagro Samar (Exhibit
1, 2 and 3) with the defendants now as sucessors-in-interest of
the plaintiff, and most of the herein plaintiffs as defendants.
The pleadings also show that upon the death of the primitive
owner, Pedro Galicia, the plaintiffs as children and grandchildren
possessed and owned this land pro-indiviso, until the possession
of said portion was transferred to the defendants when the
decision in that forcible entry case was executed in 1976 (Exhibit
7) such being the case, therefore, with respect to this portion of
the land in dispute, the possession is settled, which would
constitute as a bar to this action.
xxx xxx xxx
With respect to the other portion of the land in dispute, the
plaintiffs admit that possession was transferred to the defendant
by virtue of a sale executed by the sheriff; the one year period
having elapsed without exercising their right of redemption, as a
result a final deed of sale was issued. The legality of the sale not
having been assailed by them, for all intents and purposes,
ownership on this land have been vested on the defendants as
heirs of Juan Palajos.
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 CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
WHEREFORE, premises above considered, judgment is hereby
rendered ordering the dismissal of the plaintiffs' complaint,
without pronouncement as to cost."
A motion to re-open the case for trial on the merits was filed by plaintiffs
but was denied in an order dated November 27, 1978 (Rollo, p. 62).
Hence, this instant petition.
Petitioners contend that the trial court erred when it decided Civil Case
No. 758-CC by summary judgment when there are several genuine
issues involved therein which require a trial of these issues on the merits,
such as:
(A) WAS THE EXECUTION SALE CONDUCTED BY DEPUTY
PROVINCIAL SHERIFF EUFROCINO T. OLIFERNES OF LOT
NO. 1363 OF THE LATE PEDRO GALICIA, PETITIONERS'
FATHER, VALID TO CONFER UPON THE DEFENDANTS IN
SAID CASE A JUST TITLE OVER SAID REALTY?
(B) WERE THE UNDIVIDED SHARES AND PARTICIPATIONS
OF JULIAN GALICIA AND CATALINO GALICIA WHO WERE
TWO OF THE LEGITIMATE CHILDREN OF PEDRO GALICIA
NOT IMPLEADED AS PARTIES IN CIVIL CASE NO. 56 IN THE
MUNICIPAL COURT OF ALMAGRO OVER LOT NO. 1363,
AFFECTED BY THAT EXECUTION SALE?
(C) WERE THE UNDIVIDED SHARES AND PARTICIPATIONS
OF EDUARDA GALICIA AND PERFECTO GALICIA OVER LOT
NO. 1363, BUT WHO WERE NOT IMPLEADED AS PARTIES IN
CIVIL CASE NO. 758-CC OF THE COURT OF FIRST INSTANCE
OF SAMAR (CALBAYOG CITY) AFFECTED BY THE DECISION
OF THE LATTER COURT OF SUMMARY JUDGMENT? (Rollo,
p. 10).
The crucial issue in this case is whether or not the trial court erred when
it decided Civil Case No. 758-CC by summary judgment.
It is the contention of petitioners that the trial court erred in deciding their
complaint (CC No. 758-CC) by summary judgment when there are
several genuine issues involved therein which require a full trial on the
merits. Among other things, petitioners contend that the execution sale
conducted by the Deputy Provincial Sheriff was null and void and would
have merited a trial on the merits. Moreover, it is further contended that
as between Civil Case No. 56 and Civil Case No. 758-CC, there can be
no res judicata, considering that there is no Identity of parties, cause of
action and subject matter between the two actions.
After a thorough review of the records, the Court finds no cogent reason
to disturb the summary judgment rendered by respondent judge.
The Rules of Court authorizes the rendition of summary judgment if the
pleadings, depositions and admissions on file together with the affidavits,
show that, except as to the amount of damages, there is no issue as to
any material fact and that the moving party is entitled to a judgment as a
matter of law (Sec. 3, Rule 34). Conversely, summary judgment is not
proper where the pleadings tender vital issues the resolution of which call
for the presentation of evidence (Villanueva v. NAMARCO, 28 SCRA 729
[1969]; Guevarra, et al., v. CA, et al., 124 SCRA 297 [1983]).
Summary judgment "is a device for weeding out sham claims or defenses
at an early stage of the litigation, thereby avoiding the expense and loss
of time involved in a trial. The very object is 'to separate what is formal or
pretended in denial or averment from what is genuine and substantial, so
that only the latter may subject a suitor to the burden of trial.' The test,
therefore, of a motion for summary judgment is-whether the pleadings,
affidavits, and exhibits in support of the motion are sufficient to overcome
the opposing papers and to justify a finding as a matter of law that there
is no defense to the action or the claim is clearly meritorious" (Estrada v.
Hon. Consolacion, et al., 71 SCRA 523 [1976]).
In addition, summary judgment is one of the methods sanctioned in the
present Rules of Court for a prompt disposition of civil actions wherein
there exists no serious controversy. The procedure may be availed of not
only by claimants, but also by defending parties who may be the object of
unfounded claims. A motion for summary judgment assumes that
scrutinizing the facts will disclose that the issues presented by the
pleadings need not be tried because they are so patently unsubstantial
as not to be genuine issues, or that there is no genuine issue as to any
material facts or where the facts appear undisputed and certain from the
pleadings, depositions, admissions and affidavits (Singleton v. Philippine
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 CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
Trust Co., 99 Phil, 91 [1956], cited in Bayang v. CA, 148 SCRA 91 the same for the purpose of determining the propriety of the summary
[1987]). judgment. Objections to the execution sale cannot be considered in the
Supreme Court inasmuch as it was not raised in the lower court (Ramiro
Examining petitioners' complaint, the Court finds that the disputed v. Grano 54 Phil. 744 [1930]; citing Tan Machan v. de la Trinidad, 3 Phil.
property is the same parcel of land, which adjoins private respondents' lot 684 [1904] and U.S. v. Inductive, 40 Phil. 84 [1919]).
which was the subject of the forcible entry case and from which
petitioners were ordered to vacate. When petitioners (then defendants), WHEREFORE, the instant petition is hereby DENIED for lack of merit.
failed to satisfy the rentals adjudged in the forcible entry case, said Costs against petitioners.
adjoining parcel of land was sold at public auction to Juan Palajos
(respondents' predecessor-in-interest) as the higher bidder in the SO ORDERED.
execution sale to satisfy the monetary judgment rendered therein. The
property so described in petitioners' complaint (Rollo, p. 36) squarely fits
what has been levied upon and sold at public auction (Rollo, p. 30), the
owners of which are now private respondents upon the demise of their
predecessor-in-interest.

There is thus no question that issue of ownership of the disputed land

subject of the present petition has long been foreclosed in the forcible
entry case which culminated in the public auction sale of the parcel of
land now sought to be recovered. Having failed to redeem the property
sold at the public auction sale within the reglementary period of twelve
(12) months (Sec. 30, Rule 39 of the Rules of Court), petitioners cannot
now claim that they still own said property. Petitioners' complaint for
Ownership and Damages is but a belated and disguised attempt to revive
a judgment debtors' right of redemption which has long expired. There
being no issue as to any material fact raised in the pleadings, summary
judgment may be rendered.

Neither can the issue of the validity of the execution sale help petitioners'
cause. Well-settled in this jurisdiction, is the rule that issues not raised
and/or ventilated in the lower court cannot be raised for the first time on
appeal (Rebodos v. WCC, 6 SCRA 717 [1962]; DBP v. CA, 116 SCRA
636 and a long line of cases). A review of the records of the case shows
that petitioners failed to directly assail and raise as issue, the validity of
the aforementioned auction sale in their complaint. It was only when the
respondent judge noted such omission in his decision dismissing Civil
Case No. 758-CC dated August 11, 1978 (Rollo, p. 48-53) that petitioners
later filed a separate action for Annulment of Auction Sale and Damages
on October 4, 1978 (Civil Case No. 837-CC; Rollo, p. 31-35). The validity
of the execution sale not having been raised and/or litigated in the case
subject of the present appeal, the Court, at this stage, cannot pass upon
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 CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
G.R. No. 106436 December 3, 1994
VIRGILIO D. IMSON, petitioner, vs. HON. COURT OF APPEALS,
HOLIDAY HILLS STOCK AND BREEDING FARM CORPORATION,
FNCB FINANCE CORPORATION, respondents.
The case at bench arose from a vehicular collision on December 11,
1983, involving petitioner's Toyota Corolla and a Hino diesel truck
registered under the names of private respondents FNCB Finance
Corporation and Holiday Hills Stock and Breeding Farm Corporation. The
collision seriously injured petitioner and totally wrecked his car.
On January 6, 1984, petitioner filed with the RTC Baguio City 1 a
Complaint for Damages 2 Sued were private respondents as registered
owners of the truck; truck driver Felix B. Calip, Jr.; the beneficial owners of
the truck, Gorgonio Co Adarme, Felisa T. Co (also known as Felisa Tan), and
Cirilia Chua Siok Bieng, and the truck insurer, Western Guaranty
Corporation.
The Complaint prayed that defendants be ordered to pay, jointly and
severally, two hundred seventy thousand pesos (P270,000.00) as
compensatory damages, fifty thousand pesos (P50,000.00) each as
moral and exemplary damages, and attorney's fees, litigation expenses,
and cost of suit. 8
Defendants driver and beneficial owners failed to answer and were
declared in default. 4 On May 29, 1987, however, petitioner and defendant
insurer, entered into a compromise agreement which provided, inter alia:
1. Defendant Western Guaranty Corporation (Western Guaranty
for short) admits that its total liability under the laws and the
insurance contract sued upon is P70,000.00;
2. In full settlement of its liability under the laws and the said
insurance contract, defendant Western Guaranty shall pay
plaintiff (herein petitioner) the amount of P70,000.00 upon the
signing of this compromise agreement;
3. This compromise agreement shall in no way waive nor
prejudice plaintiffs (herein petitioner's) rights to proceed against
the other defendants with respect the remainder of his claims;
4. This compromise agreement shall be a full and final settlement
of the issues between plaintiff (herein petitioner) and defendant
Western Guaranty in their complaint and answer and, from now
on, they shall have no more right against one another except the
enforcement of this compromise agreement.
In consequence of the compromise agreement, the trial court dismissed
the Complaint for Damages against Western Guaranty Corporation on
June 16, 1987. 8 A copy of the Order of dismissal was received by private
respondent Holiday Hills Stock and Breeding Farm Corporation on July 13,
1987. Nearly eighteen (18) months later, said private respondent moved to
dismiss the case against all the other defendants. It argued that since they
are all indispensable parties under a common cause of action, the dismissal
of the case against defendant insurer must result in the dismissal of the suit
against all of them. The trial court denied the motion.
Private respondent Holiday Hills Stock and Breeding Farm Corporation
assailed the denial order through a Petition for Certiorari, Prohibition
and Mandamus With Restraining Order filed with respondent Court of
Appeals. The Petition was docketed as CA-G.R. SP No. 17651. On July
10, 1992, the Court of Appeals, 7 through its Special Sixth
Division, 8 reversed the trial court, as it ruled:
The petitioner (herein private respondent Holiday Hills Stock and
Breeding Farm Corporation) cites the doctrine laid down in Lim Tanhu v.
Hon. Ramolete, 66 SCRA 425, as applied later in Co v. Acosta, 134
SCRA 185, to support its averment that the court a quo gravely abused
its discretion in refusing to dismiss the case.
Essentially, the doctrine adverted to essays that in a common cause of
action where all the defendants are indispensable parties, the court's
power to act is integral and cannot be split, such that it cannot relieve any
of them and at the same time render judgment against the rest.
We find applicability of the doctrine to the case at bar.
A cursory reading of the complaint . . . reveals that the cause of action
was the alleged bad faith and gross negligence of the defendants
resulting in the injuries complained of and for which the action for
damages was filed. The inclusion of Western Guaranty Corporation was
vital to the claim, it being the insurer of the diesel truck without which, the
11
 CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
claim could be set for naught. Stated otherwise, it is an indispensable
party as the petitioner (herein private respondent stock and breeding
farm corporation) . . . . Private respondent's (herein petitioner's argument
that the said insurance company was sued on a different cause of action,
i.e., its bounden duty under the insurance law to pay or settle claims
arising under its policy coverage, is untenable, for the cited law perceives
the existence of a just cause, and according to the answer filed by the
Western Guaranty Corporation . . . the proximate cause of the accident
was the fault of the plaintiff (herein petitioner), hence it was not liable for
damages. There is in fact a congruence of affirmative defense among the
answering defendants.
Moreover, it is undisputed that the injury caused is covered by the
insurance company concerned. Thus, when the said insurer settled its
liability with the private respondent (petitioner herein) . . . , the other
defendants, as the insured and indispensable parties to a common cause
of action, necessarily benefited from such settlement including the
defaulted defendants, for as stated in the aforecited cases, it is deemed
that anything done by or for the answering defendant is done by or for the
ones in default since it is implicit in the rule that default is in essence a
mere formality that deprives them of no more than to take part in the trial,
but if the complaint is dismissed as to the answering defendant, it should
also be dismissed as to them. 9 (Citations omitted.)
Petitioner now comes to this Court with the following assignments of
error:
A. RESPONDENT COURT OF APPEALS COMMITTED A
REVERSIBLE ERROR IN RULING THAT THE DEFENDANTS IN
CIVIL CASE NO. 248-R ARE INDISPENSABLE PARTIES;
B. RESPONDENT COURT OF APPEALS COMMITTED A
REVERSIBLE ERROR IN RULING THAT IN CIVIL CASE NO.
248-R THERE IS A COMMON CAUSE OF ACTION AGAINST
THE DEFENDANTS THEREIN;
C. RESPONDENT COURT OF APPEALS COMMITTED A
REVERSIBLE ERROR IN RULING THAT IN CIVIL CASE NO.
248-R THE RULING OF THIS HONORABLE COURT IN LIM TAN
HU VS. RAMOLETE IS APPLICABLE;
D. RESPONDENT COURT OF APPEALS COMMITTED A
REVERSIBLE ERROR IN RULING THAT THE DOCTRINE OF
ESTOPPEL AND LACHES ON MATTERS OF JURISDICTION IS
NOT APPLICABLE IN CIVIL CASE NO. 248-R.
There is merit to the petition,.
In the case of Lim Tanhu v. Ramolete, 66 SCRA 425, 458-459 (1975) this
court held that:
. . . (I)n all instances where a common cause of action is alleged
against several defendants, some of whom answer and the
others do not, the latter or those in default acquire a vested right
not only to own the defense interposed in the answer of their co-
defendant or co-defendants not in default but also to expect a
result of the litigation totally common with them in kind and in
amount whether favorable or unfavorable. The substantive unity
of the plaintiffs cause against all the defendants is carried through
to its adjective phase as ineluctably demanded by the
homogeneity and indivisibility of justice itself. . . . The integrity of
the common cause of action against all the defendants and the
indispensability of all of them in the proceedings do not permit
any possibility of waiver of the plaintiffs right only as to one or
some of them, without including all of them, and so, as a rule,
withdrawal must be deemed to be a confession of weakness as to
all. . . . . Where all the defendants are indispensable parties, for
which reason the absence of any of them in the case would result
in the court losing its competency to act validly, any compromise
that the plaintiff might wish to make with any of them must, as a
matter of correct procedure, have to await until after the rendition
of the judgment, at which stage the plaintiff may then treat the
matter of its execution and the satisfaction of his claim as variably
as he might please. Accordingly, in the case now before Us
together with the dismissal of the complaint against the non-
defaulted defendants, the court should have ordered also the
dismissal thereof as to petitioner (referring to the defaulting
defendants in the case).
In sum, Lim Tanhu states that where a complaint alleges a common
cause of action against defendants who are all indispensable parties to
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 CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
the case, its dismissal against any of them by virtue of a compromise
agreement with the plaintiff necessarily results in the dismissal of the
case against the other defendants, including those in default. The ruling
is rooted on the rationale that the court's power to act in a case involving
a common cause of action against indispensable parties "is integral and
cannot be split such that it cannot relieve any of them and at the same
time render judgment against the rest. 10
For Lim Tanhu to apply to the case at bench, it must be established that:
(1) petitioner has common cause of action against private respondents
and the other defendants in Civil Case No. 248-R; and (2) all the
defendants are indispensable parties to the case.
Cause of action has a fixed meaning in this jurisdiction. It is the delict or
wrong by which the right of the plaintiff is violated by the defendant. 11 The
question as to whether a plaintiff has a cause of action is determined by the
averments in the pleadings pertaining to the acts of the defendant. Whether
such acts give him a right of action is determined by substantive law. 12
In the case at bench, it is clear that petitioner has different and separate
causes of action against the defendants in the case. The allegations in
the Complaint show that petitioner seeks to recover from the truck driver
for his wrong which caused injury to petitioner and his car. The cause of
action against him is based on quasi-delict under Article 2176 of the New
Civil Code. Quasi-delict, too, is the basis of the cause of action against
defendants beneficial and registered owners. But in their case, it is Article
2180 of the same Code which governs the rights of the parties.
However, with respect to defendant Western Guaranty Corporation,
petitioner's cause of action is based on contract. He seeks to recover
from the insurer on the basis of the third party liability clause of its
insurance contract with the owners of the truck. This is acknowledged by
the second paragraph of the compromise agreement between petitioner
and defendant insurer, thus:
2. In full settlement of its liability under the laws and the said
insurance contract, defendant Western Guaranty shall pay
plaintiff (herein petitioner) the amount of P70,000.00 upon the
signing of this compromise agreement.
Quite clearly then, Lim Tanhu will not apply to the case at bench
for there is no showing that petitioner has a common cause of
action against the defendants in Civil Case No. 248-R.
But this is not all. Defendants in Civil Case No. 248-R are not all
indispensable parties. 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. 13 In his absence there cannot be a
resolution of the dispute of the parties before the court which is effective,
complete, or equitable. 14
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. 15 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. 16
It is true that all of petitioner's claims in Civil Case No. 248-R is premised
on the wrong committed by defendant truck driver. Concededly, the truck
driver is an indispensable party to the suit. The other defendants,
however, cannot be categorized as indispensable parties. They are
merely proper parties to the case. Proper parties have been described as
parties whose presence is necessary in order to adjudicate the whole
controversy, but whose interests are so far separable that a final decree
can be made in their absence without affecting them. 17 It is easy to see
that if any of them had not been impleaded as defendant, the case would still
proceed without prejudicing the party not impleaded. Thus, if petitioner did
not sue Western Guaranty Corporation, the omission would not cause the
dismissal of the suit against the other defendants. Even without the insurer,
the trial court would not lose its competency to act completely and validly on
the damage suit. The insurer, clearly, is not an indispensable party in Civil
Case No. 248-R.
IN VIEW WHEREOF, the instant petition is GRANTED. The Decision,
dated July 10, 1992, of the Court of Appeals in CA-G.R. SP No. 17651 is
REVERSED AND SET ASIDE. The Complaint in Civil Case No. 248-R is
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 CIVIL PROCEDURE CASES Judgement and Final Orders (Rule 36)
REINSTATED and REMANDED to the trial court for further proceedings.
No costs. SO ORDERED.

14