1. FILOMENA DOMAGAS, petitioner, vs.
VIVIAN LAYNO JENSEN, 1) Ordering the defendant, her representatives, agents and persons
respondent.
This is a petition for review on certiorari, under Rule 45 of the Rules
of Court, of the Decision[1] of the Court of Appeals (CA) in CA-G.R.
CV No. 73995, which affirmed the Decision[2] of the Regional Trial
Court (RTC) of Dagupan City, Branch 44, in Civil Case No. 2000-0244-
D, which declared null and void the decision of the Municipal Trial
Court (MTC) of Calasiao, Pangasinan in Civil Case No. 879.[3]
The antecedent facts follow.
On February 19, 1999, petitioner Filomena Domagas filed a
complaint for forcible entry against respondent Vivian Jensen before
the MTC of Calasiao, Pangasinan. The petitioner alleged in her
complaint that she was the registered owner of a parcel of land
covered by Original Certificate of Title (OCT) No. P-30980, situated in
Barangay Buenlag, Calasiao, Pangasinan, and with an area of 827
square meters. On January 9, 1999 the respondent, by means of
force, strategy and stealth, gained entry into the petitioners
property by excavating a portion thereof and thereafter constructing
a fence thereon. As such, the petitioner was deprived of a 68-square
meter portion of her property along the boundary line. The
petitioner prayed that, after due proceedings, judgment be
rendered in her favor, thus:
3. And, after trial, judgment be rendered:
a) DECLARING the writ of Preliminary Mandatory Injunction and Writ
of Preliminary Injunction permanent;
b) ORDERING defendant, his representatives, agents and persons
acting under her, to vacate the portion of the property of the
plaintiff occupied by them and to desist from entering, excavating
and constructing in the said property of the plaintiff described in
paragraph 2 hereof and/or from disturbing the peaceful ownership
and possession of the plaintiff over the said land, pending the final
resolution of the instant action;
c) ORDERING defendant to pay reasonable rental at FIVE THOUSAND
(P5,000.00) PESOS per month from January 9, 1999 up to the time
she finally vacates and removes all constructions made by her in the
property of the plaintiff and up to the time she finally restores the
said property in the condition before her illegal entry, excavation
and construction in the property of the plaintiff;
d) ORDERING defendant to pay actual damages in the amount of
TWENTY THOUSAND (P20,000.00) PESOS; moral damages in the
amount of TWENTY THOUSAND (P20,000.00) PESOS; attorneys fees
of THIRTY THOUSAND (P30,000.00) PESOS in retainers fee and ONE
THOUSAND FIVE HUNDRED (P1,500.00) PESOS per court appearance
fee; exemplary damages in the amount of TWENTY THOUSAND
(P20,000.00) PESOS, and, costs.
Plaintiff further prays for other reliefs and remedies just and
equitable in the premises.[4]
The case was docketed as Civil Case No. 879. The summons and the
complaint were not served on the respondent because the latter
was apparently out of the country. This was relayed to the Sheriff by
her (the respondents) brother, Oscar Layno, who was then in the
respondents house at No. 572 Barangay Buenlag, Calasiao,
Pangasinan. The Sheriff left the summons and complaint with Oscar
Layno, who received the same.[5]
Nonetheless, on May 17, 1999, the court rendered judgment
ordering the respondent and all persons occupying the property for
and in the latters behalf to vacate the disputed area and to pay
monthly rentals therefor, including actual damages, attorneys fees,
and exemplary damages. The fallo of the decision reads:
acting under her, to vacate the 68-square meters which she
encroached upon;
2) Ordering the defendant to pay a monthly rental of P1,000.00 to
the plaintiff;
3) To pay plaintiff actual damages of P20,000.00; attorneys fees of
P15,000.00 and exemplary damages in the amount of P20,000.00
plus the costs.
SO ORDERED.[6]
The respondent failed to appeal the decision. Consequently, a writ
of execution was issued on September 27, 1999.
On August 16, 2000, the respondent filed a complaint against the
petitioner before the RTC of Dagupan City for the annulment of the
decision of the MTC in Civil Case No. 879, on the ground that due to
the Sheriffs failure to serve the complaint and summons on her
because she was in Oslo, Norway, the MTC never acquired
jurisdiction over her person. The respondent alleged therein that the
service of the complaint and summons through substituted service
on her brother, Oscar Layno, was improper because of the following:
(a) when the complaint in Civil Case No. 879 was filed, she was not a
resident of Barangay Buenlag, Calasiao, Pangasinan, but of Oslo,
Norway, and although she owned the house where Oscar Layno
received the summons and the complaint, she had then leased it to
Eduardo Gonzales; (b) she was in Oslo, Norway, at the time the
summons and the complaint were served; (c) her brother, Oscar
Layno, was merely visiting her house in Barangay Buenlag and was
not a resident nor an occupant thereof when he received the
complaint and summons; and (d) Oscar Layno was never authorized
to receive the summons and the complaint for and in her behalf.[7]
The respondent further alleged that the MTC had no jurisdiction
over the subject matter of the complaint in Civil Case No. 879
because the petitioner, the plaintiff therein, failed to show prior
possession of the property. She further claimed that the alleged
forcible entry was simply based on the result of the survey
conducted by Geodetic Engineer Leonardo de Vera showing that the
property of the respondent encroached on that of the petitioner.
The respondent filed a Manifestation dated August 31, 2000, and
appended thereto the following: (a) a copy[8] of her passport
showing that she left the country on February 17, 1999; (b) a copy[9]
of the Contract of Lease dated November 24, 1997, executed by her
and Eduardo D. Gonzales over her house for a period of three (3)
years or until November 24, 2000; (c) her affidavit[10] stating, inter
alia, that she owned the house at Barangay Buenlag, Calasiao,
Pangasinan, which she leased to Eduardo Gonzales; that she was
married to Jarl Jensen, a citizen of Norway, on August 23, 1987 and
had resided in Norway with her husband since 1993; that she arrived
in the Philippines on December 31, 1998, but left on February 17,
1999; she returned to the Philippines on July 30, 2000 and learned,
only then, of the complaint against her and the decision of the MTC
in Civil Case No. 879; her brother Oscar Layno was not a resident of
the house at Barangay Buenlag; and that she never received the
complaint and summons in said case; (d) the affidavit[11] of Oscar
Layno declaring that sometime in April 1999, he was in the
respondents house to collect rentals from Eduardo Gonzales; that
the Sheriff arrived and served him with a copy of the summons and
the complaint in Civil Case No. 879; and that he never informed the
respondent of his receipt of the said summons and complaint; (e) an
affidavit[12] of Eduardo Gonzales stating that he leased the house of
the respondent and resided thereat; the respondent was not a
resident of the said house although he (Gonzales) allowed the
respondent to occupy a room therein whenever she returned to the
1
Philippines as a balikbayan; and that Oscar Layno was not residing
therein but only collected the rentals.
In her answer to the complaint, the petitioner alleged that the
respondent was a resident of Barangay Buenlag, Calasiao,
Pangasinan and was the owner of the subject premises where Oscar
Layno was when the Sheriff served the summons and complaint;
that the service of the complaint and summons by substituted
service on the respondent, the defendant in Civil Case No. 879, was
proper since her brother Oscar Layno, a resident and registered
voter of Barangay. Buenlag, Calasiao, Pangasinan, received the
complaint and summons for and in her behalf.
The petitioner appended the following to her answer: (a) a copy[13]
of the Deed of Absolute Sale executed by Jose Layno in her favor,
dated August 26, 1992, showing that the respondent was a resident
of Barangay Buenlag, Calasiao, Pangasinan; (b) a Real Estate
Mortgage[14] executed by the respondent, dated February 9, 1999
showing that she was a resident of Barangay Buenlag, Calasiao,
Pangasinan; (c) the Joint Affidavit[15] of Vicenta Peralta and Orlando
Macalanda, both residents of Barangay Buenlag, Calasiao,
Pangasinan, declaring that the respondent and her brother Oscar
Layno were their neighbors; that the respondent and her brother
had been residents of Barangay Buenlag since their childhood; that
although the respondent left the country on several occasions, she
returned to the Philippines and resided in her house at No. 572
located in the said barangay; and (d) the Voters Registration
Record[16] of Oscar Layno, approved on June 15, 1997.
After due proceedings, the trial court rendered a decision in favor of
the respondent. The dispositive portion reads:
WHEREFORE, judgment is rendered in favor of plaintiff Vivian Layno
Jensen and against defendant Filomena Domagas, as follows:
1. The Decision of the Municipal Trial Court of Calasiao, Pangasinan
in Civil Case No. 879, entitled Filomena Domagas versus Vivian Layno
Jensen is declared null and void, for lack of jurisdiction over the
person of the plaintiff and the subject matter.
2. Defendant Filomena Domagas is ordered to pay plaintiff, the
following:
a.) Actual damages, representing litigation expenses in the amount
of P50,000.00;
b.) Attorneys fees in the amount of P50,000.00;
c.) Moral Damages in the amount of P50,000.00;
d.) Exemplary Damages in the amount of P50,000.00; and
e.) Costs of suit.
SO ORDERED.[17]
The trial court declared that there was no valid service of the
complaint and summons on the respondent, the defendant in Civil
Case No. 879, considering that she left the Philippines on February
17, 1999 for Oslo, Norway, and her brother Oscar Layno was never
authorized to receive the said complaint and summons for and in
her behalf.
The petitioner appealed the decision to the CA which, on May 6,
2003, rendered judgment affirming the appealed decision with
modifications. The CA ruled that the complaint in Civil Case No. 879
was one for ejectment, which is an action quasi in rem. The
appellate court ruled that since the defendant therein was
temporarily out of the country, the summons and the complaint
should have been served via extraterritorial service under Section 15
in relation to Section 16, Rule 14 of the Rules of Court, which
likewise requires prior leave of court. Considering that there was no
prior leave of court and none of the modes of service prescribed by
the Rules of Court was followed by the petitioner, the CA concluded
that there was really no valid service of summons and complaint
upon the respondent, the defendant in Civil Case No. 879.
Hence, the present petition.
The petitioner assails the decision of the CA, alleging that the
appellate court erred in holding that the respondents complaint for
ejectment is an action quasi in rem. The petitioner insists that the
complaint for forcible entry is an action in personam; therefore,
substituted service of the summons and complaint on the
respondent, in accordance with Section 7, Rule 14 of the Rules of
Court, is valid. The petitioner, likewise, asserts that Oscar Layno is a
resident and a registered voter of Barangay Buenlag, Calasiao,
Pangasinan; hence, the service of the complaint and summons on
the respondent through him is valid.
The respondent, on the other hand, asserts that the action for
forcible entry filed against her was an action quasi in rem, and that
the applicable provision of the Rules of Court is Section 15 of Rule
14, which calls for extraterritorial service of summons.
The sole issue is whether or not there was a valid service of the
summons and complaint in Civil Case No. 879 on the respondent
herein who was the defendant in the said case. The resolution of the
matter is anchored on the issue of whether or not the action of the
petitioner in the MTC against the respondent herein is an action in
personam or quasi in rem.
The ruling of the CA that the petitioners complaint for forcible entry
of the petitioner against the respondent in Civil Case No. 879 is an
action quasi in rem, is erroneous. The action of the petitioner for
forcible entry is a real action and one in personam.
The settled rule is that the aim and object of an action determine its
character.[18] 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.[19] 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.[20] 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.[21] Of this character are suits to compel a defendant to
specifically perform some act or actions to fasten a pecuniary
liability on him.[22] 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 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.[23] In Combs v.
Combs,[24] 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.[25]
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.[26] 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.[27] Actions quasi in rem deal with the status,
ownership or liability of a particular property but which are intended
2
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.[28]
Section 1, Rule 70 of the Rules of Court provides:
Section 1. Who may institute proceedings, and when. - Subject to
the provisions of the next succeeding section, a person deprived of
the possession of any land or building in force, intimidation, threat,
strategy, or stealth, or a lessor, vendor, vendee, or other person
against whom the possession of any land or building is unlawfully
withheld after the expiration or termination of the right to hold
possession by virtue of any contract, express or implied, or the legal
representatives or assigns of any such lessor, vendor, vendee, or
other person, may, at any time within one (1) year after such
unlawful deprivation or withholding of possession, bring an action in
the proper Municipal Trial Court against the person or persons
unlawfully withholding or depriving of possession, or any person or
persons claiming under them, for the restitution of such possession,
together with damages and costs.
Under Section 15, Rule 70 of the said Rule, the plaintiff may be
granted a writ of preliminary prohibition or mandatory injunction:
Sec. 15. Preliminary Injunction. The court may grant preliminary
injunction, in accordance with the provisions of Rule 58 hereof, to
prevent the defendant from committing further acts of
dispossession against the plaintiff.
A possessor deprived of his possession through forcible entry or
unlawful detainer may, within five (5) days from the filing of the
complaint, present a motion in the action for forcible entry or
unlawful detainer for the issuance of a writ of preliminary
mandatory injunction to restore him in his possession. The court
shall decide the motion within thirty (30) days from the filing
thereof.
If, after due proceedings, the trial court finds for the plaintiff, it shall
then render judgment in his or her favor, thus:
Sec. 17. Judgment. If, after trial, the court finds that the allegations
of the complaint are true, it shall render judgment in favor of the
plaintiff for the restitution of the premises, the sum justly due as
arrears of rent or as reasonable compensation for the use and
occupation of the premises, attorneys fees and costs. If it finds that
said allegations are not true, it shall render judgment for the
defendant to recover his costs. If a counterclaim is established, the
court shall render judgment for the sum found in arrears from either
party and award costs as justice requires.
From the aforementioned provisions of the Rules of Court and by its
very nature and purpose, an action for unlawful detainer or forcible
entry is a real action and in personam because the plaintiff seeks to
enforce a personal obligation or liability on the defendant under
Article 539 of the New Civil Code,[29] for the latter to vacate the
property subject of the action, restore physical possession thereof to
the plaintiff, and pay actual damages by way of reasonable
compensation for his use or occupation of the property.[30]
As gleaned from the averments of the petitioners complaint in the
MTC, she sought a writ of a preliminary injunction from the MTC and
prayed that the said writ be made permanent. Under its decision,
the MTC ordered the defendant therein (the respondent in this
case), to vacate the property and pay a monthly rental of P1,000.00
to the plaintiff therein (the petitioner in this case).
On the issue of whether the respondent was validly served with the
summons and complaint by the Sheriff on April 5, 1999, the
petitioner asserts that since her action of forcible entry against the
respondent in Civil Case No. 879 was in personam, summons may be
served on the respondent, by substituted service, through her
brother, Oscar Layno, in accordance with Section 7, Rule 14 of the
Rules of Court. The petitioner avers that Oscar Layno, a person of
suitable age and discretion, was residing in the house of the
respondent on April 5, 1999. She avers that the fact that the house
was leased to and occupied by Eduardo Gonzales was of no
moment. Moreover, the Sheriff is presumed to have performed his
duty of properly serving the summons on the respondent by
substituted service.
The contention of the petitioner has no merit.
In Asiavest Limited v. Court of Appeals,[31] the Court had the
occasion to state:
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: (a)
substituted service set forth in Section 8; (2) personal service
outside the country, with leave of court; (3) service by publication,
also with leave of court; or (4) any other manner the court may
deem sufficient.[32]
Thus, any judgment of the court which has no jurisdiction over the
person of the defendant is null and void.[33]
In the present case, the records show that the respondent, before
and after his marriage to Jarl Jensen on August 23, 1987, remained a
resident of Barangay Buenlag, Calasiao, Pangasinan. This can be
gleaned from the Deed of Absolute Sale dated August 26, 1992 in
which she declared that she was a resident of said barangay.
Moreover, in the Real Estate Mortgage Contract dated February 9,
1999, ten days before the complaint in Civil Case No. 879 was filed,
the petitioner categorically stated that she was a Filipino and a
resident of Barangay Buenlag, Calasiao, Pangasinan. Considering
that the respondent was in Oslo, Norway, having left the Philippines
on February 17, 1999, the summons and complaint in Civil Case No.
879 may only be validly served on her through substituted service
under Section 7, Rule 14 of the Rules of Court, which reads:
SEC. 7. Substituted service. If, for justifiable causes, the defendant
cannot be served within a reasonable time as provided in the
preceding section, service may be effected (a) by leaving copies of
the summons at the defendants residence with some person of
suitable age and discretion then residing therein, or (b) by leaving
the copies at defendants office or regular place of business with
some competent person in charge thereof.
Strict compliance with the mode of service is required in order that
the court may acquire jurisdiction over the person of the
defendant.[34] The statutory requirement of substituted service
must be followed faithfully and strictly and any substituted service
other than that authorized by the statute is rendered ineffective.[35]
As the Court held in Hamilton v. Levy:[36]
The pertinent facts and circumstances attendant to the service of
summons must be stated in the proof of service or Officers Return;
otherwise, any substituted service made in lieu of personal service
cannot be upheld. This is necessary because substituted service is in
derogation of the usual method of service. It is a method
3
extraordinary in character and hence may be used only as
prescribed and in the circumstances authorized by statute. Here, no
such explanation was made. Failure to faithfully, strictly, and fully
comply with the requirements of substituted service renders said
service ineffective.[37]
In Keister v. Narcereo,[38] the Court held that the term dwelling
house or residence are generally held to refer to the time of service;
hence, it is not sufficient to leave the summons at the formers
dwelling house, residence or place of abode, as the case may be.
Dwelling house or residence refers to the place where the person
named in the summons is living at the time when the service is
made, even though he may be temporarily out of the country at the
time. It is, thus, the service of the summons intended for the
defendant that must be left with the person of suitable age and
discretion residing in the house of the defendant. Compliance with
the rules regarding the service of summons is as much important as
the issue of due process as of jurisdiction.[39]
The Return of Service filed by Sheriff Eduardo J. Abulencia on the
service of summons reads:
Respectfully returned to the court of origin the herein summons and
enclosures in the above-entitled case, the undersigned caused the
service on April 5, 1999.
Defendant Vivian Layno Jensen is out of the country as per
information from her brother Oscar Layno, however, copy of
summons and enclosures was received by her brother Oscar Layno
on April 5, 1999 as evidenced by his signature appearing in the
original summons.
Calasiao, Pangasinan, April 6, 1999.
(Sgd.)
EDUARDO J. ABULENCIA
Junior Process Server[40]
As gleaned from the said return, there is no showing that as of April
5, 1999, the house where the Sheriff found Oscar Layno was the
latters residence or that of the respondent herein. Neither is there
any showing that the Sheriff tried to ascertain where the residence
of the respondent was on the said date. It turned out that the
occupant of the house was a lessor, Eduardo Gonzales, and that
Oscar Layno was in the premises only to collect the rentals from
him. The service of the summons on a person at a place where he
was a visitor is not considered to have been left at the residence or
place or abode, where he has another place at which he ordinarily
stays and to which he intends to return.[41]
The Voters Registration Record of Oscar Layno dated June 15, 1997
wherein he declared that he was a resident of No. 572 Barangay
Buenlag, Calasiao, Pangasinan, as well as the Joint Affidavit of
Vicenta Peralta and Orlando Macasalda cannot prevail over the
Contract of Lease the respondent had executed in favor of Eduardo
Gonzales showing that the latter had resided and occupied the
house of the respondent as lessee since November 24, 1997, and the
affidavit of Eduardo Gonzales that Oscar Layno was not residing in
the said house on April 5, 1999.
In sum, then, the respondent was not validly served with summons
and the complaint in Civil Case No. 879 on April 5, 1999, by
substituted service. Hence, the MTC failed to acquire jurisdiction
over the person of the respondent; as such, the decision of the MTC
in Civil Case No. 879 is null and void.
IN LIGHT OF ALL THE FOREGOING, the petition is DENIED for lack of
merit. No costs.
SO ORDERED.
2. ERNESTO V. YU and ELSIE O. YU, Petitioners,
vs.
1
BALTAZAR PACLEB, Respondent.
DECISION
CORONA, J.:
The present petition filed under Rule 45 of the Rules of Court
originated from an action for forcible entry and damages filed by
petitioners Ernesto and Elsie Yu against respondent Baltazar Pacleb.
The antecedent facts follow.
Sometime in September 1992, Ruperto Javier allegedly offered to
sell Lot No. 6853-D to petitioners for P75 per sq.m.lawphil.net The
lot was approximately 18,000 square meters and was located in
Barangay Langkaan, Dasmariñas, Cavite. Javier supposedly
purchased the lot from one Rebecca del Rosario who, in turn,
acquired it from respondent and his wife. The title of the property
(Transfer Certificate of Title [TCT] No. T-118375), however, remained
in the names of respondent and his wife. The instruments in support
of the series of alleged sales were not registered.
On September 11, 1992, petitioners accepted the offer and gave
Javier P200,000 as downpayment for the lot. Javier then delivered
his supposed muniments of title to petitioners. After the execution
of a contract to sell, he formally turned over the property to petiti
oners.
At the time of the turn-over, a portion of the lot was occupied by
Ramon C. Pacleb, respondent’s son, and his wife as tenants. On
September 12, 1992, Ramon and his wife allegedly surrendered
possession of their portion to petitioners. Later on, petitioners
appointed Ramon as their trustee over the subject lot.
Aside from taking possession of the property, petitioners also
caused the annotation on TCT No. T-118375 of a decision rendered
2
in their favor in Civil Case No. 741-93. This decision attained finality
on April 19, 1995.
Petitioners alleged that they exercised ownership rights as well as
enjoyed open, public and peaceful possession over the property
from September 12, 1992 until the early part of September 1995.
During this time, respondent was in the United States.
Upon respondent’s return to the Philippines in May 1995, he
allegedly entered the property by means of force, threat,
intimidation, strategy and stealth thereby ousting petitioners and
their trustee, Ramon.
Despite repeated demands, respondent, asserting his rights as
registered owner of the property, refused to vacate the premises
and surrender its possession to petitioners.
3
Petitioners filed an action for forcible entry in the Municipal Trial
Court (MTC) of Dasmariñas, Cavite on November 23, 1995.
Respondent filed an answer with compulsory counterclaim dated
December 8, 1995. After the issues were joined, the MTC required
the submission of the parties’ position papers at a preliminary
conference on March 11, 1996. Respondent failed to comply.
On June 17, 1996, the MTC ruled:
WHEREFORE, in view of the foregoing, the [respondent] and other
persons claiming right under him are hereby ordered to surrender
4
physical possession of Lot No. 6853-D in favor of the [petitioners]
and to pay the sum of TWENTY-FIVE THOUSAND (P25,000.00) PESOS
as attorney’s fees.
4
SO ORDERED.
5
On appeal, the Regional Trial Court (RTC) of Imus, Cavite rendered a
6
decision affirming the MTC decision in toto.
7 however, respondent transferred the administration of the land to
Respondent elevated his case to the Court of Appeals (CA) which
rendered the assailed decision on March 18, 1997:
WHEREFORE, the Petition is GRANTED; the Decision dated October
25, 1996 of the [RTC] of Imus, Cavite in Civil Case No. 052-96 and the
Decision of the [MTC] of Dasmariñas, Cavite in Civil Case No. 182 are
SET ASIDE; and Civil Case No. 182 for Forcible Entry and Damages is
hereby ordered DISMISSED. No pronouncement as to costs.
8 over the land through alleged frequent visits and the designation of
SO ORDERED.
In a resolution dated August 20, 1997, the CA denied petitioners’
motion for reconsideration for lack of merit.
Before us now come petitioners who claim that the appellate court
erred in finding that respondent had prior physical possession of the
subject property.lawphil.net
"In an action for forcible entry, the plaintiff must prove that he was
in prior possession of the land or building and that he was deprived
thereof by means of force, intimidation, threat, strategy or
9
stealth." The plaintiff, however, cannot prevail where it appears
that, as between himself and the defendant, the latter had
10
possession antedating his own. We are generally precluded in a
Rule 45 petition from reviewing factual evidence tracing the events
11
prior to the first act of spoliation. However, the conflicting factual
findings of the MTC and RTC on one hand, and the CA on the other,
require us to make an exception.
We overrule petitioners’ contentions.
The Civil Code states that possession is the holding of a thing or the
12
enjoyment of a right. In the grammatical sense, to possess means
to have, to actually and physically occupy a thing, with or without
13
right. "Possession always includes the idea of occupation x x x. It is
not necessary that the person in possession should himself be the
occupant. The occupancy can be held by another in his
14 15
name." Without occupancy, there is no possession.
16
Two things are paramount in possession. First, there must be
occupancy, apprehension or taking. Second, there must be intent to
17
possess (animus possidendi).
Here, petitioners failed to establish that they had prior physical
possession to justify a ruling in their favor in the complaint for
forcible entry against respondent.
In the decision in Civil Case No. 741-93 (a case for specific
performance and damages against Javier, the alleged vendor of the
lot in question) upon which petitioners based their right to possess
in the first place, the trial court categorically stated:
The [petitioners were never placed] in possession of the subject
property on which [was] planned to be [site of] a piggery, nor [were
they] given a clearance or certification from the Municipal Agrarian
18
Reform Officer. (emphasis ours)
The claim that the lot was turned over to petitioners in 1992 was
self-serving in the face of this factual finding. On the other hand, the
tax declarations and receipts in the name of respondent in 1994 and
19
1995 established the possession of respondent. The payment of
real estate tax is one of the most persuasive and positive indications
showing the will of a person to possess in concepto de dueño or with
20
claim of ownership.
"[P]ossession in the eyes of the law does not mean that a man has to
have his feet on every square meter of the ground before he is
21
deemed in possession." In this case, Ramon, as respondent’s son,
was named caretaker when respondent left for the United States in
22
1983. Due to the eventual loss of trust and confidence in Ramon,
his other son, Oscar, in January 1995 until his return in May
23
1995. In other words, the subject land was in the possession of the
respondent’s sons during the contested period.
Petitioners cite an alleged document (Kusangloob na Pagsasauli ng
Lupang Sakahan at Pagpapahayag ng Pagtalikod sa Karapatan)
dated March 10, 1995 executed by them and Ramon to prove a turn
over of possession. They also seek to prove their exercise of rights
Ramon as their own trustee as declared in a joint affidavit attached
to their position paper filed with the MTC. These instruments,
however, fail to convince us of petitioners’ actual occupancy of the
subject land. First, petitioners themselves acknowledged that
Ramon and his wife occupied part of the land as tenants of
respondent. Second, Ramon, a mere tenant, had no authority to sign
such document dated March 10, 1995 waiving all rights to the land.
Third, there was no clear proof in the records of the appointment of
Ramon as petitioners’ trustee save their self-serving statements to
this effect. Finally, at the time the Kusangloob na
Pagsasauli document was executed, the caretaker of the land was
no longer Ramon but Oscar.
24
Most important, the title of the land in question (TCT No. T-118375)
25
remained in the name of respondent. "As the registered owner,
petitioner had a right to the possession of the property, which is one
26
of the attributes of ownership." The Civil Code states:
Art. 538. Possession as a fact cannot be recognized at the same time
in two different personalities except in the cases of co-possession.
Should a question arise regarding the fact of possession, the present
possessor shall be preferred; if there are two possessors, the one
longer in possession; if the dates of the possession are the same, the
one who presents a title; and if all these conditions are equal, the
thing shall be placed in judicial deposit pending determination of its
possession or ownership through proper proceedings.
In view of the evidence establishing respondent’s continuing
possession of the subject property, petitioners’ allegation that
respondent deprived them of actual possession by means of force,
intimidation and threat was clearly untenable. In Gaza v. Lim, we
held that:
Where a dispute over possession arises between two persons, the
person first having actual possession is the one who is entitled to
maintain the action granted by law; otherwise, a mere usurper
without any right whatever, might enter upon the property of
another and, by allowing himself to be ordered off, could acquire
the right to maintain the action of forcible entry and detainer,
27
however momentary his intrusion might have been.
WHEREFORE, the petition is hereby DENIED. The decision of the
Court of Appeals dated March 18, 1997 in CA-G.R. SP No. 42604
is AFFIRMED.
Costs against petitioners.
SO ORDERED.
3. REBECCA T. CABUTIHAN, petitioner, vs. LANDCENTER
CONSTRUCTION & DEVELOPMENT CORPORATION, respondent.
5
DECISION
PANGANIBAN, J.:
Breach of contract gives rise to a cause of action for specific
performance or for rescission. A suit for such breach is not capable
of pecuniary estimation; hence, the assessed value of the real
estate, subject of the said action, should not be considered in
computing the filing fees. Neither a misjoinder nor a non-joinder of
parties is a ground for dismissal of an action, because parties may be
dropped or added at any stage of the proceedings.
The Case
Before us is a Petition for Review on Certiorari under Rule 45,
assailing the Orders dated September 8, 2000 and November 21,
2000, promulgated by of the Regional Trial Court (RTC) of Pasig City,
[1]
Branch 263. The first assailed Order disposed as follows:
WHEREFORE, foregoing premises considered, this Court hereby
[2]
resolves to dismiss the instant complaint.
[3]
Reconsideration was denied in the second challenged Order.
property thus recovered for and in behalf of [respondent
corporation].
[5]
xxx xxx xxx.
[6]
Armed with Board Resolution No. 01, Series of 1997, which had
authorized her to represent the corporation, Luz Baylon Ponce
entered into a February 11, 1997 Deed of Undertaking with a group
composed of petitioner, Wenifredo P. Forro, Nicanor Radan Sr. and
Atty. Prospero A. Anave. The Deed states the following:
WHEREAS, the UNDERTAKER [respondent corporation] solicited,
engaged and hereby voluntarily acknowledges the assistance of
certain persons, in recovering, arranging and financing the
undertaking up to completion/consummation of the same;
WHEREAS, the UNDERTAKER freely, voluntarily, unconditionally and
irrevocably agreed, committed and undertook to compensate x x x
said persons, in the manner, specified hereinbelow;
WHEREFORE, considering the foregoing premises, and the mutual
covenants of the parties, the UNDERTAKER hereby unconditionally
and irrevocably [c]ommit[s] and [u]ndertake[s], as follows:

The Facts 1. To pay or compensate the following persons, based on the gross
area of the afore-described parcel of land or gross proceeds of the
Culled from the pleadings, the facts of this case are as follows.
sale thereof, as the case may be, to wit:
On December 3, 1996, herein respondent Landcenter Construction
Rebecca T. Cabutihan ------------------------------------ 20%
& Development Corporation, represented by Wilfredo B.Maghuyop -
[4]
- entered into an Agreement with Petitioner Rebecca Wenifredo P. Forro ----------------------------------- 10%
Cabutihan.The Agreement stipulates:
Nicanor Radan, Sr. ------------------------------------ 4%
WHEREAS, [respondent corporation], x x x is the absolute owner, x x
x of a parcel of land situated at Kay-biga, Paranaque, Metro Manila Atty. Prospero A. Anave ----------------------------------- 2.5%
covered under Transfer Certificate of Title No. (S-30409) (partially
cancelled by TCT Nos. 110001 to 110239) and particularly described TOTAL ----------------------------------- 36.5%
as follows:
2. Execute a Deed of Assignment unto and in favor of each of the
A parcel of land (Plan Psu-80206, Case No. 290, G.L.R.O. Record No. persons above-mentioned corresponding to their respective shares
2291), situated in the Barrio of Kay-biga, Municipality of Paranaque, in the subject parcel of land or in the proceeds thereof;
Province of Rizal. Bounded on the NE., by properties of Eulogio Cruz
3. This Undertaking as well as the Deed of Assignment above-stated
and Isidro Alano; on the E., by property of Justo Bernardo; on the
shall be effective and binding upon the heirs, successors-in-interest,
SE., by properties of Marcelo Nofuente and Lorenzo Molera; on the [7]
assigns or designates of the parties herein.
SW., by properties of Higino and Pedro P. Lopez; on the W., by
property of Odon Rodriguez; and on the NW., by properties of
An action for specific performance with damages was filed by
Evaristo de los Santos and Pastor Leonardo.....; containing an area of
petitioner on October 14, 1999 before the RTC of Pasig City, Branch
ONE HUNDRED SEVEN THOUSAND AND FORTY SEVEN (107,047)
263. She alleged:
SQUARE METERS, more or less.
[6.] [Petitioner] accomplished her undertakings under the subject
WHEREAS, [respondent corporation] decided to engage the
Agreement and the Undertaking. So in a letter dated 18 April 1997, x
assistance of [petitioner] and x x x herein called the FACILITATOR for
x x, [respondent corporation] was informed accordingly
the purpose of facilitating and arranging the recovery of the
thereof.Simultaneously, [petitioner] demanded upon [respondent
property in question, as well as the financing of such undertakings
corporation] to execute the corresponding Deed of Assignment of
necessary in connection thereto;
the lots in the subject property, as compensation for the services
rendered in favor of the [respondent corporation]. The subject letter
WHEREFORE, premises considered and of the mutual covenants of
was duly received and acknowledged receipt, by then Acting
the parties, they have agreed, as follows:
Corporate Secretary of the [respondent corporation].
1. The FACILITATOR undertakes to effect the recovery of the
[7.] [Respondent corporation] failed and refused to act on x x x said
property subject hereof, including the financing of the undertaking,
demand of [petitioner]. Hence, [she] sent a letter dated May 8,
up to the registration of the same in the name of [respondent
1997, to the Register of Deeds for Paranaque, to inform x x x said
corporation], except any and all taxes due;
Office of x x x [her] claim x x x;
2. The FACILITATOR shall be responsible for whatever arrangements
[8.] x x x [T]he subject property was already transferred to and
necessary in relation to the squatters presently occupying [a]
registered in the name of [respondent corporation] under Transfer
portion of the property, as well as the legitimate buyers of lots
Certificate of Title No. -123917-, of the Registry of Deeds for
thereof;
Paranaque City x x x;
3. As compensation for the undertaking of the FACILITATOR, [she]
xxx xxx xxx
shall be entitled to Twenty [Percent] (20%) of the total area of the

6
[10.] With x x x said title of the property now in the possession of
the [respondent corporation], [petitioner] is apprehensive that the
more that [she] will not be able to obtain from [respondent
corporation], compliance with the afore-stated Agreement and
Undertaking, to the extreme detriment and prejudice of [petitioner]
and her group, x x x;
xxx xxx xxx
[8]
[12.] Then in a letter, dated 10 September 1999, [petitioner]
through counsel sent to [respondent corporation] a Formal Demand,
to comply with its obligation x x x but x x x [respondent corporation]
[9]
did not heed the demand. x x x.
Petitioner prayed, inter alia, that respondent corporation be
ordered to execute the appropriate document assigning, conveying,
transferring and delivering the particular lots in her favor. The lots
represented compensation for the undertakings she performed and
accomplished, as embodied in the Agreement.
Respondent then filed a Motion to Dismiss, alleging the following:
5. Because of the troubled situation obtaining at the management
level of [respondent corporation], the sale between [respondent
corporation] and PCIB regarding the Fourth Estate Subdivision was
not registered with the Register of Deeds office, although
[respondent corporation] continued holding the deed of sale over
the Fourth Estate Subdivision.
6. A group of persons led by one Wilfredo Maghuyop, including
herein [petitioner], Wenifredo Forro, Nicanor Radan, and others,
taking advantage of the management mess at [respondent
corporation], tried to grab ownership of the [respondent
corporation], and with use of fraud, cheat, misrepresentation and
theft of vital documents from the office of [respondent corporation],
succeeded in filing with the Securities and Exchange Commission
false papers and documents purporting to show that the Articles of
Incorporation of [respondent corporation] had been amended,
installing Maghuyop as president of [respondent corporation]. It was
on these occasions that [petitioner] and her companions x x x, with
use of fraud, stealth, tricks, deceit and cheat succeeded in letting Luz
Baylon Ponce sign a so-called Deed of Undertaking by virtue of
which [respondent corporation] is duty-bound to give to
[petitioner], Forro, Radan and Atty. Prospero Anave 36.5% of the
land area of the Fourth Estate Subdivision as compensation for
alleged services and expenses made by these people in favor of
[respondent corporation]. They also caused said x x x Maghuyop to
sign an Agreement with [petitioner] expressing an obligation on the
part of [respondent corporation] to give a big part of the land x x x
to [petitioner]. These Agreement and Deed of Undertaking are being
made by herein [petitioner] as her causes of action in the present
case.
Wilfredo Maghuyop was a stranger to [respondent corporation], and
he was an impostor used by [petitioner] and her companions to
barge into the management of [respondent corporation] for the
purpose of stealing and creating an obligation against [respondent
corporation] in their favor.
7. But Luz Baylon Ponce, whose signature appears on the instrument
denominated as Deed of Undertaking, vehemently denies that she
signed said instrument freely and voluntarily. She says that
Wenifredo Forro and Nicanor Radan were once real estate agents of
[respondent corporation] who promised to help sell lots from her
project Villaluz II Subdivision located [in] Malibay, Pasay
City. According to Luz Baylon Ponce, the Board of Directors of
[respondent corporation] negotiated with Forro and Radan for the
latter to sell units/lots of Villaluz II Subdivision, and to help obtain a
financier who would finance for the expenses for the reconstitution
of the lost title of the Fourth Estate Subdivision situated [in] Sucat,
Paranaque City. Shortly thereafter, these two men resigned from
[respondent corporation] as agents, after they manipulated the
signing of x x x said Deed of Undertaking by Luz Baylon Ponce on
February 11, 1997. The latter is an old woman 80 years of age. She is
weak, has x x x poor sight, and is feeble in her mental ability. Forro
and Radan inserted the Deed of Undertaking among the papers
intended for application for reconstitution of [respondent
corporations] title which these men caused Luz Baylon Ponce to
[10]
sign, and she unknowingly signed the Deed of Undertaking. x x x.
In the Motion, respondent sought the dismissal of the Complaint on
the grounds of (1) improper venue, (2) lack of jurisdiction over the
subject matter, and (3) nonpayment of the proper docket
fees.Specifically, it contended:
8. That venue is improperly laid
xxx xxx xxx
(b) In other words, the present case filed by [petitioner] is for her
recovery (and for her companions) of 36.5% of [respondent
corporations] land (Fourth Estate Subdivision) or her interest
therein. x x x therefore, x x x the present case filed x x x is a real
action or an action in rem.
(c) x x x [Following] Section 1, Rule 4 of the Rules of Court, as
amended x x x the present case should have been filed by
[petitioner] with the proper court in Paranque City which has
jurisdiction over the x x x Fourth Estate Subdivision because said
subdivision is situated in Paranaque City. Since [petitioner] filed the
present case with this x x x [c]ourt in Pasig City, she chose a wrong
venue x x x.
xxx xxx xxx
9. That the [c]ourt has no jurisdiction over the subject matter of the
claim
xxx xxx xxx
(c) x x x Wenifredo P. Forro, Nicanor Radan, Sr. and Atty. Prospero A.
Anave are not named as plaintiffs in the complaint. [Petitioner] x x x
is not named as representative of Forro, Radan and Anave by virtue
of a Special Power of Attorney or other formal written
authority. According to the Rules, where the action is allowed to be
prosecuted or defended by a representative or someone acting in a
fiduciary capacity, the beneficiary shall be included in the title of the
case and shall be deemed to be the real party in interest (Sec. 3,
Rule 3, Rules of Court, as amended x x x).
xxx xxx xxx
10. That a condition precedent for filing the claim has not been
complied with
xxx xxx xxx
(b) Obviously, [petitioner] has not paid the docket or filing fees on
the value of her land claim x x x. Thirty-six percent (36%) x x x
[11]
is P180,000,000.00, x x x.
Ruling of the Trial Court
The RTC ruled that the allegations in the Complaint show that its
primary objective was to recover real property. Equally important,
the prayer was to compel respondent to execute the necessary
deeds of transfer and conveyance of a portion of the property
corresponding to 36.5 percent of its total area or, in the alternative,
to hold respondent liable for the value of the said portion, based on
the prevailing market price. The RTC further ruled that, since the suit
7

would affect the title to the property, it should have been instituted
[12]
in the trial court where the property was situated.
Furthermore, the action was filed only by petitioner. There was no
allegation that she had been authorized by Forro, Radan and Anave
to represent their respective shares in the compensation.
Finally, since this case was an action in rem, it was imperative for
petitioner to pay the appropriate docket or filing fees equivalent to
the pecuniary value of her claim, a duty she failed to
discharge.Consequently, following Manchester Development Corp. v.
[13]
Court of Appeals, the trial court never acquired jurisdiction over
the case.
[14]
Hence, this Petition.
Issues
In her Memorandum, petitioner phrases the issue in this wise:
Whether or not the dismissal of the [C]omplaint was in accordance
[15]
with the pertinent law and jurisprudence on the matter.
She argues that the RTC erred in dismissing her Complaint on the
grounds of (1) improper venue, (2) non-joinder of necessary parties,
and (3) non-payment of proper docket fees.
This Courts Ruling
The Petition is meritorious.
First Issue:
Proper Venue
Maintaining that the action is in personam, not in rem, petitioner
alleges that the venue was properly laid. The fact that she ultimately
sought the conveyance of real property not located in the territorial
jurisdiction of the RTC of Pasig is, she claims, an anticipated
consequence and beyond the cause for which the action was
instituted.
On the other hand, the RTC ruled that since the primary objective of
petitioner was to recover real property -- even though her
Complaint was for specific performance and damages -- her action
should have been instituted in the trial court where the property
was situated, in accordance with Commodities Storage & Ice Plant
[16]
Corp. v. Court of Appeals.
We agree with petitioner. Sections 1 and 2, Rule 4 of the Rules of
[17]
Court provide an answer to the issue of venue. Actions affecting
title to or possession of real property or an interest therein (real
actions), shall be commenced and tried in the proper court that has
territorial jurisdiction over the area where the real property is
situated. On the other hand, all other actions, (personal actions)
shall be commenced and tried in the proper courts where the
plaintiff or any of the principal plaintiffs resides or where the
defendant or any of the principal defendants resides.
In Commodities Storage cited earlier, petitioner spouses obtained a
loan secured by a mortgage over their land and ice plant in Sta.
Maria, Bulacan. Because they had failed to pay the loan, the
mortgage was foreclosed and the ice plant auctioned. Before the
RTC of Manila, they sued the bank for damages and for the fixing of
the redemption period. Since the spouses ultimately sought
redemption of the mortgaged property, the action affected the
mortgage debtors title to the foreclosed property; hence, it was a
[18]
real action. Where the action affects title to the property, it
should be instituted in the trial court where the property is
[19]
situated.
[20]
In National Steel Corp. v. Court of Appeals, the Court held that an
action in which petitioner seeks the execution of a deed of sale of a
parcel of land in his favor x x x has been held to be for the recovery
of the real property and not for specific performance since his
primary objective is to regain the ownership and possession of the
parcel of land.
However, in La Tondea Distillers, Inc. v. Ponferrada, private
[21]
respondents filed an action for specific performance with damages
before the RTC of Bacolod City. The defendants allegedly reneged on
their contract to sell to them a parcel of land located in Bago City - -
a piece of property which the latter sold to petitioner while the case
was pending before the said RTC. Private respondent did not claim
ownership but, by annotating a notice of lis pendens on the title,
recognized defendants ownership thereof. This Court ruled that the
venue had properly been laid in the RTC of Bacolod, even if the
property was situated in Bago.
[22]
In Siasoco v. Court of Appeals, private respondent filed a case for
specific performance with damages before the RTC of Quezon City. It
alleged that after it accepted the offer of petitioners, they sold to a
third person several parcels of land located in Montalban, Rizal. The
Supreme Court sustained the trial courts order allowing an
amendment of the original Complaint for specific performance with
damages. Contrary to petitioners position that the RTC of Quezon
City had no jurisdiction over the case, as the subject lots were
located in Montalban, Rizal, the said RTC had jurisdiction over the
original Complaint. The Court reiterated the rule that a case for
specific performance with damages is a personal action which may
be filed in a court where any of the parties reside.
A close scrutiny of National Steel and Ruiz reveals that the prayers
for the execution of a Deed of Sale were not in any way connected
to a contract, like the Undertaking in this case. Hence, even if there
were prayers for the execution of a deed of sale, the actions filed in
the said cases were not for specific performance.
In the present case, petitioner seeks payment of her services in
accordance with the undertaking the parties signed. Breach of
contract gives rise to a cause of action for specific performance or
[23]
for rescission. If petitioner had filed an action in rem for the
conveyance of real property, the dismissal of the case would have
been proper on the ground of lack of cause of action.
Second Issue:
Non-Joinder of Proper Parties
Petitioner claims that she was duly authorized and empowered to
represent the members of her group and to prosecute their claims
on their behalf via a Special Power of Attorney executed by Forro,
Radan and Anave. Besides, she argues that the omission of her
companions as plaintiffs did not prevent the RTC from proceeding
with the action, because whatever judgment would be rendered
would be without prejudice to their rights. In the alternative, she
avers that the trial court may add or drop a party or parties at any
stage of the action and on such terms as are just.
The RTC ruled that there was no allegation anywhere in the records
that petitioner had been authorized to represent Forro, Radan and
Anave, who were real parties-in-interest with respect to their
respective shares of the 36.5 percent claim. Such being the case, the
trial court never acquired jurisdiction over the subject matter of
their claims.
Again, we side with petitioner. Neither a misjoinder nor a non-
joinder of parties is a ground for the dismissal of an action. Parties
may be dropped or added by order of the court, on motion of any
party or on the courts own initiative at any stage of the
[24]
action. The RTC should have ordered the joinder of such party,
8
and noncompliance with the said order would have been ground for
dismissal of the action.
Although the Complaint prayed for the conveyance of the whole
36.5 percent claim without impleading the companions of petitioner
as party-litigants, the RTC could have separately proceeded with the
case as far as her 20 percent share in the claim was concerned,
independent of the other 16.5 percent. This fact means that her
companions are not indispensable parties without whom no final
[25]
determination can be had. At best, they are mere necessary
parties who ought to be impleaded for a complete determination or
[26]
settlement of the claim subject of the action. The non-inclusion of
a necessary party does not prevent the court from proceeding with
the action, and the judgment rendered therein shall be without
prejudice to the rights of such party.
[27]
Third Issue:
Correct Docket Fees
Petitioner insists that the value of the real property, which was the
subject of the contract, has nothing to do with the determination of
the correct docket or filing fees.
The RTC ruled that although the amount of damages sought had not
been specified in the body of the Complaint, one can infer from the
assessed value of the disputed land that it would amount to P50
million. Hence, when compared to this figure, the P210 paid as
docket fees would appear paltry.
We hold that the trial court and respondent used technicalities to
avoid the resolution of the case and to trifle with the law. True,
Section 5, Rule 141 of the Rules of Court requires that the assessed
value of the real estate, subject of an action, should be considered in
computing the filing fees. But the Court has already clarified that the
[28]
Rule does not apply to an action for specific performance, which
[29]
is classified as an action not capable of pecuniary estimation.
Besides, if during the course of the trial, petitioners 20 percent claim
on the Fourth Estate Subdivision can no longer be satisfied and the
payment of its monetary equivalent is the only solution left, Sunlife
[30]
Insurance Office, Ltd. v. Asuncion holds as follows: Where the
filing of the initiatory pleading is not accompanied by payment of
the docket fee, the court may allow payment of the fee within a
reasonable time but in no case beyond the applicable prescriptive or
reglementary period.
WHEREFORE, the Petition is hereby GRANTED, and the assailed
Orders REVERSED and SET ASIDE. The case is REMANDED to the
court of origin which is ordered to PROCEED with deliberate speed in
disposing of the case. No costs.
SO ORDERED.
4. CITIZENS' SURETY AND INSURANCE CO., INC., petitioner,
vs.
THE HON. JUDGE RICARDO C. PUNO, THE REGISTER OF DEEDS OF
THE CITY OF MANILA AND THE CITY OF MANILA, respondents.
ABAD SANTOS, J.:
This is an appeal by certiorari where it is "prayed that judgment be
rendered declaring the aforesaid Resolution No. 542, Series of 1956,
of the City of Manila null and void and ordering the Register of
Deeds of the City of Manila to register the petitioner's affidavit of
consolidation and to issue to the latter a new transfer certificate of
title." (Rollo, pp. 11-12.)
Maria Barcelon owned a piece of land measuring 108 square meters
located in Barrio Obrero, Tondo, Manila. It was covered by TCT No.
79798.
It appears that Barrio Obrero was acquired by the City of Manila
pursuant to its Charter; it was subdivided into lots of 108 sq. m. each
for residential houses; and the sale of the lots was regulated by
Resolution No. 168, series of 1922, which was amended several
times, the last by Resolution No. 542, stipulate of 1956. Paragraph 4
of Resolution No. 542 stipulates that:
4. Only Filipino laborers who are bona fide residents in Manila
whose wages do not exceed P180.00 per month, or P6.00 per day,
according as they receive monthly or daily compensation shall have
the privilege of buying lots in the Barrio. (Rollo, p. 18.).
On October 10, 1966, Maria Barcelon mortgaged the land to
Citizens' Surety and Insurance Co., The purchaser was the lender.
After the expiration of the period of redemption, the purchaser
sought to consolidate its ownership but the Register of Deeds of
Manila refused to register the consolidation. On April 6, 1971, the
corporation instituted Civil Case No. 82820 in the Court of First
Instance of Manila against the Register of Deeds of Manila and the
City of Manila. It prayed that Resolution No. 542 be declared nun
and void and that the Register of Deeds be ordered to register the
consolidation of title.
Judge Ricardo C. Puno dismissed the case. In this appeal, the
petitioner insists, as it did in the court below, that Resolution No.
542 is unconstitutional and that it is not applicable to forced sales.
The petition is devoid of merit and should be dismiss.
Put simply, the petitioner claims that Resolution No. 542 is
unconstitutional because it is unreasonable and violates the equal
protection clause of the Constitution. It argues as follows:
As may be seen from Sec. 4 of Res. No. 542, only laborers earning
not more than P180.00 a month or P6.00 a day are qualified to buy
lands in Barrio Obrero, Tondo, Manila- Employees working in offices
or establishments and earning as much but who are not laborers
cannot buy lands in that area. Also persons who are engaged in
some calling or occupation earning as much are not also qualified. It
should not be overlooked that the intention of the pertinent
provisions of the Charter of the City of Manila contained in Sections
97, 98 and 100 of said lands on easy terms.
xxx xxx xxx
Res. No. 542 includes laborers but does not include low-salaried
employees. Laborers are not the only poor people in the City of
Manila. There are also others who are the low-salaried employees
and those engaged in some calling or occupation where their
income is limited. Are these people to be considered more fortunate
and, therefore, should have less in law?
The classification resorted to in Sec. 4 of the aforesaid Resolution
does not come within the meaning of the principle of equal
protection of the laws. A classification to come within such principle
must fulfill the following requisites: the classification must not be
capricious or arbitrary, but must be natural and reasonable. And to
be reasonable (1) it must rest on substantial distinction; (2) it must
be germane to the purpose of the law; (3) it must not be limited to
existing conditions only; and (4) must apply equally to all members
of the same class. (Political Law Reviewer, Aruego & Laguio 1954 Ed.,
p. 764, citing the cases of PPI v. Cayat 38 O.G. March 9, 1940; Ruby
vs. Provincial Board of Mindoro, 39 Phil. 660; People & Hongkong &
Shanghai Banking Corp. vs. Vera & Co-Unjeng , 37 O.G. 187.)
An analysis of the provision of Sec. 4 of Resolution No. 542 will show
that the classification made thereby does not fulfill the above
mentioned requisites. The classification of laborer does not have a
substantial distinction from low-salaried employees or persons
engaged in some calling with a limited income, because all of them
9
are under like circumstances in their lives, in their liberty, in their
property, and in the pursuit of happiness. (Brief, pp. 12-14.)
The lot in question is situated in Barrio Obrero. Obrero means
laborer or manual worker. There is, therefore, a justifiable and
reasonable basis to limit the sale of the lots in the barrio to obreros
only they are birds of the same feather.
The petitioner also claims that the resolution is unreasonable
because it bars a non-laborer to buy a lot in Barrio Obrero even if he
does not earn more than P180.00 a month or P6.00 a day. The
petitioner, which is a corporation and not a lowly paid worker, is not
competent to raise this claim. For even if We sustain it no benefit
can accrue to the petitioner who will nonetheless be disqualified to
acquire the lot. Moreover, in the absence of manifest abuse of
power, We are not prepared to substitute Our judgment for that of
the City of Manila which is tasked by its Charter "to acquire private
lands in the city and to subdivide the same into home lots for sale on
easy terms to residents, giving first priority to the bona-fide tenants
or occupants of said lands, and second priority to laborers and low-
salaried employees." (Sec. 100, R.A. No. 409, as amended.)
Obviously, the questioned resolution merely seeks to implement the
Charter provision.
Anent the claim that the questioned resolution does not apply to
force sales, Judge Puno said it all as follows:
There is no merit in the pretension that the questioned resolution
does not apply to forced sales. It is implemented in sales upon
foreclosure or on execution by limiting bids to those persons legally
qualified to purchase. The legal intent and purpose of the resolution
would be rendered utterly nugatory if the same be restricted in its
application to voluntary sales. (Rollo, pp. 21-22.)
Also, the resolution does not distinguish between voluntary and
forced sales. It is hornbook law expounded by Professor Gerardo
Florendo when he taught in the College of Law, University of the
Philippines, that when the law does not distinguish we should not
distinguish.
WHEREFORE, the petition is dismissed without any special
pronouncement as to costs.
SO ORDERED.
5. JIMMY T. GO, petitioner, vs. UNITED COCONUT PLANTERS BANK,
ANGELO V. MANAHAN, FRANCISCO C. ZARATE, PERLITA A.
URBANO and ATTY. EDWARD MARTIN, respondents.
DECISION
CHICO-NAZARIO, J.:
[1]
Before Us is a Petition for Review on Certiorari assailing the
[2]
Decision dated 31 July 2002 of the Court of Appeals in CA-G.R. SP
No. 62625, the decretal portion of which reads:
WHEREFORE, the petition is GRANTED and the assailed orders dated
June 7, 2000, August 9, 2000 and November 8, 2000 are SET ASIDE.
Respondent judge is directed to DISMISS Civil Case No. 67878 on the
ground of improper venue.
[3]
Petitioner Jimmy T. Go and Alberto T. Looyuko are co-owners of
Noahs Ark International, Noahs Ark Sugar Carriers, Noahs Ark Sugar
Truckers, Noahs Ark Sugar Repacker, Noahs Ark Sugar Insurers,
Noahs Ark Sugar Terminal, Noahs Ark Sugar Building, and Noahs Ark
[4]
Sugar Refinery.
Sometime in August 1996, petitioner Jimmy T. Go and Alberto T.
Looyuko applied for an Omnibus Line accommodation with
respondent United Coconut Planters Bank (UCPB) in the amount of
[5]
Nine Hundred Million (P900,000,000) Pesos, and was favorably
acted upon by the latter.
The transaction was secured by Real Estate Mortgages over parcels
of land, covered by Transfer Certificate of Title (TCT) No. 64070,
located at Mandaluyong City with an area of 24,837 square meters,
and registered in the name of Mr. Looyuko; and TCT No. 3325, also
located at Mandaluyong City with an area of 14,271 square meters,
registered in the name of Noahs Ark Sugar Refinery.
On 21 July 1997, the approved Omnibus Line accommodation
[6]
granted to petitioner was subsequently cancelled by respondent
UCPB. As a consequence, petitioner Jimmy T. Go demanded from
UCPB the return of the two (2) TCTs (No. 64070 and No. 3325)
covered by Real Estate Mortgages earlier executed. UCPB refused to
return the same and proceeded to have the two (2) pre-signed Real
Estate Mortgages notarized on 22 July 1997 and caused the
registration thereof before the Registry of Deeds of Mandaluyong
City on 02 September 1997.
On 15 June 1999, respondent UCPB filed with the Office of the Clerk
of Court and Ex-Officio Sheriff of Mandaluyong City an extrajudicial
[7]
foreclosure of real estate mortgage covered by TCT No. 64070, for
nonpayment of the obligation secured by said mortgage. As a result,
the public auction sale of the mortgaged property was set on 11
April 2000 and 03 May 2000.
To protect his interest, petitioner Jimmy T. Go filed a complaint for
Cancellation of Real Estate Mortgage and damages, with prayer for
temporary restraining order and/or writ of preliminary injunction,
against respondent bank and its officers, namely, Angelo V.
Manahan, Francisco C. Zarate, Perlita A. Urbano and Atty. Edward E.
Martin, together with Ex-Officio Sheriff Lydia G. San Juan and Sheriff
IV Helder A. Dyangco, with the Regional Trial Court of Pasig City,
Branch 266, docketed as Civil Case No. 67878. The complaint was
[8]
subsequently amended on 22 May 2000. The amended complaint
alleged, among other things, the following: that petitioner Jimmy T.
Go is a co-owner of the property covered by TCT No. 64070,
although the title is registered only in the name of Looyuko; that
respondent bank was aware that he is a co-owner as he was asked
to sign two deeds of real estate mortgage covering the subject
property; that the approved omnibus credit line applied for by him
and Looyuko did not materialize and was cancelled by respondent
bank on 21 July 1997, so that the pre-signed real estate mortgages
were likewise cancelled; that he demanded from respondent bank
that TCTs No. 64070 and No. 3325 be returned to him, but
respondent bank refused to do so; that despite the cancellation of
the omnibus credit line on 21 July 1997, respondent bank had the
two deeds of real estate mortgage dated and notarized on 22 July
1997 and caused the extrajudicial foreclosure of mortgage
constituted on TCT No. 64070; that the auction sale scheduled on 11
April 2000 and 03 May 2000 be enjoined; that the two real estate
mortgages be cancelled and TCTs No. 64070 and No. 3325 be
returned to him; and that respondent bank and its officers be
ordered to pay him moral and exemplary damages and attorneys
fees.
On 07 June 2000, respondent bank, instead of filing an answer, filed
[9]
a motion to dismiss based on the following grounds: 1) that the
court has no jurisdiction over the case due to nonpayment of the
proper filing and docket fees; 2) that the complaint was filed in the
wrong venue; 3) an indispensable party/real party in interest was
not impleaded and, therefore, the complaint states no cause of
action; 4) that the complaint was improperly verified; and 5) that
petitioner is guilty of forum shopping and submitted an insufficient
and false certification of non-forum shopping.
10
 [10]
On 07 June 2000, the trial court issued an order granting
petitioners application for a writ of preliminary injunction.
Correspondingly, the auction sale, scheduled on 11 April 2000 and
03 May 2000, was enjoined.
[11]
On 09 August 2000, the trial court denied respondent banks
motion to dismiss Civil Case No. 67878. A motion for
[12]
reconsideration was filed, but the same was likewise denied in an
[13]
Order dated 08 November 2000.
Respondent bank questioned said orders before the Court of
[14]
Appeals via a petition for certiorari dated 03 January 2001,
alleging that the trial court acted without or in excess of jurisdiction
or with grave abuse of discretion in issuing an order denying the
motion to dismiss and the motion for reconsideration thereof.
[15]
On 31 July 2002, the Court of Appeals set aside the Orders dated
07 June 2000, 09 August 2000 and 08 November 2000 issued by the
trial court and directed the trial court to dismiss Civil Case No. 67878
on the ground of improper venue.
[16]
A motion for reconsideration was filed by petitioner, which was
[17]
denied in an order dated 14 November 2002.
[18]
Hence, this petition for review on certiorari.
On 16 June 2003, the Court gave due course to the petition, and
[19]
required the parties to file their respective memoranda.
Respondents filed their Joint Memorandum on 27 August 2003,
while petitioner filed his on 25 September 2003 upon prior leave of
court for extension. With leave of this Court, private respondents
filed their reply to petitioners memorandum.
In his memorandum, petitioner raised a lone issue:
WHETHER OR NOT THE COURT OF APPEALS COMMITTED
REVERSIBLE ERROR WHEN IT FAILED TO APPLY THE LAW AND
ESTABLISHED JURISPRUDENCE ON THE MATTER BY ISSUING THE
QUESTIONED RESOLUTIONS FINDING THAT THE CASE A QUO IS A
REAL ACTION.
Simply put, the issue to be resolved in this case is whether
petitioners complaint for cancellation of real estate mortgage is a
personal or real action for the purpose of determining venue.
In a real action, the plaintiff seeks the recovery of real property, or
[20]
as provided for in Section 1, Rule 4, a real action is an action
affecting title to or possession of real property, or interest therein.
These include partition or condemnation of, or foreclosure of
mortgage on, real property. The venue for real actions is the same
for regional trial courts and municipal trial courts -- the court which
has territorial jurisdiction over the area where the real property or
[21]
any part thereof lies.
Personal action is one brought for the recovery of personal property,
for the enforcement of some contract or recovery of damages for its
breach, or for the recovery of damages for the commission of an
[22]
injury to the person or property. The venue for personal actions is
likewise the same for the regional and municipal trial courts -- the
court of the place where the plaintiff or any of the principal plaintiffs
resides, or where the defendant or any of the principal defendants
resides, at the election of the plaintiff, as indicated in Section 2 of
[23]
Rule 4.
It is quite clear then that the controlling factor in determining venue
for cases of the above nature is the primary objective for which said
cases are filed. Thus:
1. In Commodities Storage & Ice Plant Corp. v. Court of
[24]
Appeals, this Court ruled that an action to redeem by the
mortgage debtor affects his title to the foreclosed property. If the
action is seasonably made, it seeks to erase from the title of the
judgment or mortgage debtor the lien created by registration of the
mortgage and sale. If not made seasonably, it may seek to recover
ownership to the land since the purchasers inchoate title to the
property becomes consolidated after [the] expiration of the
redemption period. Either way, redemption involves the title to the
foreclosed property. It is a real action.
[25]
2. In Fortune Motors, (Phils.), Inc., v. Court of Appeals, this
Court quoting the decision of the Court of Appeals ruled that 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.
[26]
3. In Punsalan, Jr. v. Vda. de Lacsamana, this court ruled that
while it is true that petitioner does not directly seek the recovery . . .
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 petitioners 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 which was timely raised.
[27]
4. In Ruiz v. J. M. Tuason Co., Inc., et al., the court ruled that
although [a] complaint is entitled to be one for specific performance,
yet the fact that [complainant] asked that a deed of sale of a parcel
of land . . . be issued in his favor and that a transfer certificate of
title covering said land be issued to him, shows that the primary
objective and nature of the action is to recover the parcel of land
itself because to execute in favor of complainant the conveyance
requested there is need to make a finding that he is the owner of
the land which in the last analysis resolves itself into an issue of
ownership. Hence, the action must be commenced in the province
where the property is situated . . . ."
5. In Dr. Antonio A. Lizares, Inc. v. Hon. Hermogenes
[28]
Caluag, this Court ruled that an action praying that defendant be
ordered `to accept the payment being made by plaintiff for the lot
which the latter contracted to buy on installment basis from the
former, to pay plaintiff compensatory damages and attorneys fees
and to enjoin defendant and his agents from repossessing the lot in
question, is one that affects title to the land under Section 3 of Rule
5, of the Rules of Court, and shall be commenced and tried in the
province where the property or any part thereof lies, because,
although the immediate remedy is to compel the defendant to
accept the tender of payment allegedly made, it is obvious that this
relief is merely the first step to establish plaintiffs title to [the] real
property.
6. In Land Tenure Administration, et al. v. The Honorable Higinio
[29]
B. Macadaeg and Alejandro T. Lim, this Court ruled that where
the lessee seeks to establish an interest in an hacienda that runs
with the land and one that must be respected by the purchaser of
the land even if the latter is not a party to the original lease contract,
the question of whether or not the standing crop is immovable
property become[s] irrelevant, for venue is determined by the
nature of the principal claim. Since the lessee is primarily interested
in establishing his right to recover possession of the land for the
purpose of enabling him to gather his share of the crops, his action is
real and must be brought in the locality where the land is situated.
11
7. In Espineli & Mojica v. Hon. Santiago and Vda. de
[30]
Ramirez, the court ruled that although the main relief sought in
the case at bar was the delivery of the certificate of title, said relief,
in turn, entirely depended upon who, between the parties, has a
better right to the lot in question. As it is not possible for the court
to decide the main relief, without passing upon the claim of the
parties with respect to the title to and possession of the lot in
question, the claim shall be determined x x x in the province where
[the] said property or any part thereof lies.
[31]
The case of Carandang v. Court of Appeals, is more particularly
instructive. There, we held that an action for nullification of the
mortgage documents and foreclosure of the mortgaged property is a
real action that affects the title to the property. Thus, venue of the
real action is before the court having jurisdiction over the territory in
which the property lies, which is the Court of First Instance of
Laguna.
Petitioner in this case contends that a case for cancellation of
mortgage is a personal action and since he resides at Pasig City,
venue was properly laid therein. He tries to make a point by alluding
[32]
to the case of Francisco S. Hernandez v. Rural Bank of Lucena.
Petitioners reliance in the case of Francisco S. Hernandez v. Rural
[33]
Bank of Lucena is misplaced. Firstly, said case was primarily an
action to compel the mortgagee bank to accept payment of the
mortgage debt and to release the mortgage. That action, which is
not expressly included in the enumeration found in Section 2(a) of
Rule 4 of the Old Civil Procedure and now under Section 1, Rule 4 of
the 1997 Rules of Civil Procedure, does not involve titles to the
mortgaged lots. It is a personal action and not a real action. The
mortgagee has not foreclosed the mortgage. The plaintiffs title is not
in question. They are in possession of the mortgaged lots. Hence,
the venue of the plaintiffs personal action is the place 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 case at bar, the action for cancellation of real
estate mortgage filed by herein petitioner was primarily an action to
compel private respondent bank to return to him the properties
covered by TCTs No. 64070 and No. 3325 over which the bank had
already initiated foreclosure proceedings because of the cancellation
by the said respondent bank of the omnibus credit line on 21 July
1997. The prime objective is to recover said real properties.
Secondly, Carandang distinctly articulated that the ruling
in Hernandez does not apply where the mortgaged property had
already been foreclosed. Here, and as correctly pointed out by the
appellate court, respondent bank had already initiated extrajudicial
foreclosure proceedings, and were it not for the timely issuance of a
restraining order secured by petitioner Go in the lower court, the
same would have already been sold at a public auction.
In a relatively recent case, Asset Privatization Trust v. Court of
[34]
Appeals, it was succinctly stated that the prayer for the
nullification of the mortgage is a prayer affecting real property,
hence, is a real action.
In sum, the cancellation of the real estate mortgage, subject of the
instant petition, is a real action, considering that a real estate
[35]
mortgage is a real right and a real property by itself. An action for
cancellation of real estate mortgage is necessarily an action affecting
the title to the property. It is, therefore, a real action which should
be commenced and tried in Mandaluyong City, the place where the
subject property lies.
WHEREFORE, the instant petition is DENIED for lack of merit. The
assailed decision dated 31 July 2002 and the Order dated 14
November 2002 denying the motion for reconsideration are hereby
AFFIRMED. With costs.
SO ORDERED.
6. MERCEDES R. GOCHAN, ALFREDO R. GOCHAN, ANGELINA R.
GOCHAN HERNAEZ, MA. MERCED R. GOCHAN GOROSPE, CRISPO R.
GOCHAN JR. and MARLON R. GOCHAN, petitioners, vs. VIRGINIA
GOCHAN, LOUISE GOCHAN, LAPULAPU REAL ESTATE
CORPORATION, FELIX GOCHAN & SONS REALTY CORPORATION and
MACTAN REALTY CORPORATION, respondents.
DECISION
PANGANIBAN, J.:
Allegations and perceptions of bias from the mere tenor and
language of a judge is insufficient to show prejudgment. Allowing
inhibition for these reasons would open the floodgates to abuse.
Unless there is concrete proof that a judge has a personal interest in
the proceedings, and that his bias stems from an extra-judicial
source, this Court shall always commence from the presumption
that a magistrate shall decide on the merits of a case with an
[1]
unclouded vision of its facts.
The Case
Before us is a Petition for Review on Certiorari under Rule 45 of the
[2]
Rules of Court, assailing the January 28, 2000 Decision and the
[3]
May 2, 2000 Resolution of the Court of Appeals (CA) in CA-GR SP
No. 54985. The decretal portion of the Decision reads as follows:
WHEREFORE, premises considered, the petition is GRANTED.
Accordingly, the Order dated 13 August 1999 denying petitioners
Motion for Inhibition and the Order dated 20 August 1999 denying
the Motion for Reconsideration are hereby nullified and respondent
Judge is hereby inhibited from further sitting in Civil Case No. CEB-
[4]
21854 entitled Gochan et. al. vs. Gochan, et al.
The assailed Resolution denied petitioners Motion for
[5]
Reconsideration.
The Facts
The facts of the case are summarized by the Court of Appeals in this
wise:
There is no dispute as to the antecedent facts that gave rise to the
instant petition involving close relatives who are either aunties,
nieces and nephews or first-cousins.
On 03 April 1998, private respondents filed a Complaint for Specific
Performance and Damages against petitioners. The case was raffled
to respondent Judge Dicdican and docketed as Civil Case No. CEB-
21854.
On 26 May 1998, petitioners filed their Answer with Counterclaim
and affirmative defenses.
On 07 August 1998, before pre-trial could be conducted, petitioners
filed a motion for a hearing on their affirmative defenses some of
which are grounds for a motion to dismiss and therefore may be the
subject of a preliminary hearing pursuant to Section 6, Rule 16, 1997
RCP. The motion was set for hearing on 11 August 1998.
In an order dated 11 August 1998, respondent judge denied
petitioners motion without conducting a hearing. Respondent judge
however did not stop with the denial but went on to rule on the
merits of the affirmative defenses, stating as follows:
[T]he Statute of Frauds does not apply in this case because the
contract which is the subject matter of this case is already an
executed contract. The Statute of Frauds applies only to executory
contracts. x x x. For another, the contention of the defendants that
12
the claims of the plaintiffs are already extinguished by full payment
thereof does not appear to be indubitable because the plaintiffs
denied under oath the due execution and genuineness of the
receipts which are attached as Annexes 1-A, 1-B and 1-C of the
defendants answer. x x x. Then, still for another, the contention that
the Complaint is defective because it allegedly has f[a]iled to
implead indispensable parties appears to be wanting in merit
because the parties to the memorandum of agreement adverted to
in the complaint are all parties in this case. Then the matter of
payment of docketing and filing fees is not a fatal issue in this case
because the record shows that the plaintiffs had paid at least
PhP165,000.00 plus...
The above ruling is the subject of a petition for certiorari before this
Court docketed as C.A.-G.R. SP No. 49084 which is pending
resolution on a motion for [re]consideration. Because of the
pendency of this petition, petitioners filed on 28 September 1998 a
motion to suspend proceedings. Instead of suspending proceedings,
the respondent judge set the case for pre-trial on 09 November
1998, per Order dated 01 October 1998.
On 05 November 1998, petitioners counsel Atty. Rolando Lim filed a
motion to reset the pre-trial from 09 November 1998 to 03
December 1998 on the ground that he had to go to Japan because of
a previous commitment. Atty. Vicente Espina, who attended the pre-
trial to explain Atty. Lims absence, manifested to respondent judge
that the petitioners were willing to explore the possibility of an
amicable settlement. In spite of the absence of handling counsel
Atty. Lim and in spite of Atty. Espinas manifestation of a possible
compromise, respondent judge proceeded with and terminated the
pre-trial. And in spite of the manifestation of Atty. Espina,
respondent judge indicated in the pre-trial order he issued that the
possibility (of a compromise) is nil.
After the termination of the pre-trial, respondent judge proceeded
to hear the evidence of private respondents who presented their
first witness on direct examination on 18 January 1999. This first
witness was cross-examined by petitioners counsel on 22 January
1999. Further hearings were set for 28 and 30 April 1999. On 23
April 1999, petitioners counsel Atty. Lim filed an urgent motion
praying that the hearing on 28 April be moved to 30 April 1999 on
the ground that he had to undergo medical tests and treatment on
27 and 28 April 1999, and that his law partner Atty. Espina would
not be able to attend in his behalf because the latter had to attend
his brothers wedding in Kananga, Leyte on 28 April 1999.
Petitioners counsel went to court on 30 April 1999 and was
surprised to learn that his motion to reset the hearing on 28 April
1999 was disregarded and that trial proceeded with private
respondents counsel conducting a re-direct examination of their first
witness and presenting their second witness on direct examination.
During the hearing on 30 April 1999, respondent judge ordered
petitioners counsel to conduct the re-cross examination of the first
witness and the cross-examination of the second witness.
Petitioners counsel manifested that he had not read the transcript of
stenographic notes taken during the hearing on 28 April 1999 and
was therefore not prepared for cross-examination. However, when
respondent judge threatened to waive petitioners right to examine
private respondents witnesses, petitioners counsel had no choice
but to accede to do what he was not prepared for.
On 05 August 1999, petitioners filed a motion to inhibit respondent
judge from further sitting in the case on grounds of partiality, pre-
judgment and gross ignorance of the law. The motion was set for
hearing on 09 August 1999 at 10:00 A.M.
In an order dated 13 August 1999, respondent judge denied the
motion for inhibition on the ground that petitioners failed to appear
to substantiate the motion.
On 16 August 1999, petitioners filed a motion for reconsideration of
the order of denial which the respondent judge likewise denied in
his Order dated 20 August 1999, reiterating that petitioners failed to
[6]
appear during the hearing on the motion. (Citations omitted)
Ruling of the Court of Appeals
The CA opined that the apprehensions of respondents about the
bias or partiality of Judge Dicdican in favor of petitioners were well-
[7]
founded. It held that the totality of the circumstances showed that
[8]
he had a glaring animosity towards their case. It further ruled that
he had likewise displayed petulance and impatience in his handling
of the case, a norm of behavior inconsistent with the cold neutrality
[9]
of an impartial judge.
[10]
The CA based its ruling on the following circumstances pointed
out by respondents:
1. Judge Dicdican denied the Motion to Hear Affirmative Defenses
filed by respondents, but in the same Order ruled on its merits
without giving them an opportunity to be heard.
2. The above Order of the judge was too well-prepared to be
extemporaneous, leading respondents to suspect that he was bent
on deciding the case in favor of petitioners.
3. Without indicating for the record respondents objections, Judge
Dicdican admitted all exhibits of petitioners and even allowed their
witnesses to answer all questions, even if he had not yet resolved
the applicability of the Statute of Frauds.
4. The judge denied respondents requests for postponements, which
were reasonable and justified under the circumstances. Further,
during the April 28, 1999 hearing, he allowed petitioners to present
their witnesses even in the absence of respondents counsel. And,
knowing that the counsel was absent when those witnesses testified
in the previous hearing, the judge forced him to cross-examine them
in the subsequent April 30, 1999 hearing.
5. During the hearing for respondents Motion for Inhibition, the
judge started to hear the case before the scheduled time.
6. Judge Dicdican issued a Pretrial Order stating that the possibility
of a compromise was nil despite the pretrial manifestation of
respondents counsel that the parties were willing to explore the
possibility of a compromise.
[11]
Hence, this Petition.
The Issues
In their Memorandum,
[12]
petitioners submit the following issues for
our consideration:
1. Whether or not the respondents are guilty of forum shopping in
filing two petitions for certiorari in the CA based on the same order
of Judge Dicdican;
2. Whether or not the CA was correct in enjoining Judge Dicdican
from sitting in the case at bar on the ground of bias and partiality;
3. Whether or not filing of a motion for inhibition on flimsy grounds
[13]
is not a form of forum shopping.
Simply stated, the issues in this case are as follows: (1) whether
respondents are guilty of forum shopping, and (2) whether Judge
Dicdican should have inhibited himself.
The Courts Ruling
The Petition is meritorious insofar as the second issue is concerned.
Judge Dicdican need not inhibit himself.
13
First Issue:
Forum Shopping
Petitioners argue that respondents should have raised the issue of
Judge Dicdicans alleged bias and partiality in their first Petition for
Certiorari docketed as CA-GR SP No. 49084, not in the present case
docketed in the appellate court as CA-GR SP No. 54985. For filing
two Petitions raising the same issues, respondents allegedly split
their cause of action and thus became guilty of forum shopping.
Petitioners further contend that the elements of litis
pendentia or res judicata are present in the case at bar, because the
matter raised in this Petition could have been taken up in the first
one.
We disagree. This Court has already definitively ruled on this matter
[14]
in GR No. 146089. In its Decision, it was confronted with the very
same question raised in this Petition. At issue then is whether there
was forum shopping in the filing of two Petitions for Certiorari -- one
for CA-GR SP No. 49084 and the other for CA-GR SP No. 54985, the
precursor of the present Petition.
The Court made a distinction between the two Petitions filed. The
first involved the propriety of the affirmative defenses relied upon
by petitioners [herein respondents] in Civil Case No. CEB-21
[15]
854. The second Petition, which is the subject of the present
appeal, raised the issue of whether or not public respondent Judge
Dicdican was guilty of manifest partiality warranting his inhibition
[16]
from further hearing Civil Case No. CEB-21 854.
Below we quote a more important point:
[T]he two petitions did not seek the same relief from the Court of
Appeals. In CA-G.R. SP. No. 49084, petitioners prayed, among
others, for the annulment of the orders of the trial court denying
their motion for preliminary hearing on affirmative defenses in Civil
Case No. CEB-21854. No such reliefs are involved in the second
petition, where petitioners merely prayed for the issuance of an
order enjoining public respondent Judge Dicdican from further trying
[17]
the case and to assign a new judge in his stead.
It should be clear that our Decision in GR No. 146089 has become
[18]
final and executory with the denial of respondents [herein
petitioners] Motion for Reconsideration therein.
Main Issue:
Inhibition
Although we find that respondents did not commit forum-shopping,
still we gave due course to this Petition on the main issue of
inhibition. Petitioners argue that the CA erred when it ruled that
Judge Dicdican should be inhibited from hearing Civil Case No. CEB-
21854 on the ground of bias and prejudice.
A critical component of due process is a hearing before a tribunal
[19]
that is impartial and disinterested. Every litigant is indeed entitled
to nothing less than the cold neutrality of an impartial judge. All the
other elements of due process, like notice and hearing, would be
meaningless if the ultimate decision were to come from a biased
[20]
judge. Section 1 of Rule 137 of the Rules of Court provides:
SECTION 1. Disqualification of judges. - No judge or judicial officer
shall sit in any case in which he, or his wife or child, is pecuniarily
interested as heir, legatee, creditor or otherwise, or in which he is
related to either party within the sixth degree of consanguinity or
affinity, or to counsel within the fourth degree, computed according
to the rules of the civil law, or in which he has been executor,
administrator, guardian, trustee or counsel, or in which he has
presided in any inferior court when his ruling or decision is the
subject of review, without the written consent of all parties in
interest, signed by them and entered upon the record.
A judge may, in the exercise of his sound discretion, disqualify
himself from sitting in a case, for just or valid reasons other than
those mentioned above.
[21]
The Rules contemplate two kinds of inhibition: compulsory and
voluntary. The instances mentioned in the first paragraph of the
cited Rule conclusively presume that judges cannot actively and
impartially sit in a case. The second paragraph, which embodies
voluntary inhibition, leaves to the discretion of the judges concerned
whether to sit in a case for other just and valid reasons, with only
their conscience as guide.
To be sure, judges may not be legally prohibited from sitting in a
[22]
litigation. But when circumstances reasonably arouse suspicions,
and out of such suspicions a suggestion is made of record that they
might be induced to act with prejudice for or against a litigant, they
[23]
should conduct a careful self-examination. Under the second
paragraph of the cited Section of the Rules of Court, parties have the
right to seek the inhibition or the disqualification of judges who do
not appear to be wholly free, disinterested, impartial or
independent in handling a case. Whether judges should inhibit
themselves therefrom rests on their own sound discretion. That
[24]
discretion is a matter of conscience and is addressed primarily to
their sense of fairness and justice.
[25]
However, judges are exhorted to exercise their discretion in a way
that the peoples faith in the courts of justice would not be impaired.
A salutary norm for them to observe is to reflect on the possibility
that the losing parties might nurture at the back of their minds the
thought that the former have unmeritoriously tilted the scales of
[26]
justice against them. Of course, the judges right must be weighed
against their duty to decide cases without fear of repression.
Verily, the second paragraph of Section 1 of Rule 137 does not give
judges the unfettered discretion to decide whether to desist from
hearing a case. The inhibition must be for just and valid causes. The
mere imputation of bias or partiality is not enough ground for them
[27]
to inhibit, especially when the charge is without basis. This Court
has to be shown acts or conduct clearly indicative of arbitrariness or
prejudice before it can brand them with the stigma of bias or
[28]
partiality.
In a string of cases, the Supreme Court has said that bias and
prejudice, to be considered valid reasons for the voluntary inhibition
of judges, must be proved with clear and convincing
[29]
evidence. Bare allegations of their partiality will not suffice. It
cannot be presumed, especially if weighed against the sacred oaths
of office of magistrates, requiring them to administer justice fairly
and equitably -- both to the poor and the rich, the weak and the
[30]
strong, the lonely and the well-connected.
Equally important is the established doctrine that bias and prejudice
must be shown to have resulted in an opinion on the merits on the
basis of an extrajudicial source, not on what the judge learned from
[31]
participating in the case. As long as opinions formed in the course
of judicial proceedings are based on the evidence presented and the
conduct observed by the magistrate, such opinion -- even if later
found to be erroneous -- will not prove personal bias or prejudice on
[32]
the part of the judge. While palpable error may be inferred from
the decision or the order itself, extrinsic evidence is required to
establish bias, bad faith, malice or corrupt purpose. At bottom, to
disqualify a judge, the movant must prove bias and prejudice by
[33]
clear and convincing evidence.
Prescinding from the foregoing standards, we do not agree with the
Court of Appeals conclusion that Judge Dicdican has shown a glaring
bias against respondents case. His actuations have not engendered
14

reasonable suspicion as to his fairness and ability to decide the case
with the cold neutrality of an impartial judge. Verily, respondents
have not convinced us that Judge Dicdican should inhibit himself
from hearing the case.
Let us now examine one by one the circumstances relied upon by
the CA in ruling for the inhibition of Judge Dicdican.
Denial of Respondents Motion
to Hear Affirmative Defenses
The first circumstance which the appellate court relied upon to show
the alleged bias and partiality of Judge Dicdican was his denial of the
Motion to Hear Affirmative Defenses filed by
[34]
respondents. According to them, even if the judge had denied
their Motion, he still ruled on the merits of their affirmative
defenses and thus deprived them of an opportunity to be heard.
The fact that respondents Motion for Hearing was denied does not
by itself show bias and partiality. Clearly, Judge Dicdican based his
denial on the Rules of Court, according to which a preliminary
hearing on affirmative defenses is indeed discretionary on the part
[35]
of a judge. Thus, Judge Dicdican cannot be charged with bias and
partiality, merely on the basis of his decision not to grant a motion
for a preliminary hearing.
We are not unmindful of our ruling in the previous Gochan v.
[36]
Gochan case. This Court held therein that the trial court
committed grave abuse of discretion when it denied the motion of
respondents for a preliminary hearing on their affirmative defenses.
[37]
But even in that case, two members of this Court dissented and
believed that respondent judge (herein Judge Dicdican) had not
committed any grave abuse of discretion in disallowing the
preliminary hearing on respondents affirmative defenses.
In any event, this Courts ruling of grave abuse of discretion in a
certiorari proceeding such as the one issued in the
earlier Gochan case does not necessarily translate to bias and
partiality that would ipso facto lead to the inhibition of the trial
judge. In fact, in the previously cited case, this Court did not mention
any badge of bias or partiality on the part of Judge Dicdican. He was
simply directed to conduct forthwith the preliminary hearing on the
affirmative defenses.
To repeat, as long as opinions formed in the course of judicial
proceedings are based on the evidence presented and the conduct
observed by the judge, such opinion -- even if later found to be
erroneous on appeal or made with grave abuse of discretion on
certiorari -- will not necessarily prove personal bias or prejudice on
[38]
the part of the judge.
Neither can respondents convince us that they were deprived of due
process. The essence of due process is the reasonable opportunity
to be heard and to submit any evidence available in support of ones
[39]
defense. Where one is accorded an opportunity to be heard,
either through oral arguments or pleadings, there is no denial of
[40]
procedural due process. Due process was designed to afford an
opportunity to be heard; an oral hearing need not always be held.
Moreover, this constitutional mandate is deemed satisfied if the
pleader is granted an opportunity to seek reconsideration of the
[41]
action or ruling complained of.
[42]
Judge Dicdicans Order denying respondents Motion for Hearing
was based on the pleadings filed by both parties. Respondents filed
their Motion to Hear Affirmative Defenses, while petitioners filed
[43]
their Comment to the Motion. Thus, it cannot be said that
respondent judge arbitrarily ruled thereon. He thereafter allowed
the respondents and petitioners to file their Motion for
[44] [45]
Reconsideration and Opposition, respectively, before deciding
on the matter again.
Character of the Order
Denying Respondents Motion
Respondents further argue that before hearing their Motion to Hear
Affirmative Defenses, Judge Dicdican had already prepared an Order
denying their plea. This is an allegation that they have not been able
to prove. We cannot rely merely on their submissions that he was in
fact bent on ruling against them. Petitioners correctly argued as
follows:
The fact is that Judge Dicdican really dictated his Order in open court
with legal citations and authorities but did not prepare it
beforehand. We respectfully submit that said act cannot be
considered as a manifestation of bias and partiality and deprived
respondents of due process because the motion filed by
respondents, copy of which was attached as Annex A to the reply of
petitioners was complete with the evidence already attached as
annexes thereto and contained citation of authorities and the
opposition of petitioners, copy of which was attached to the reply as
Annex B, contained citations of authorities as well.
[46]
The argument that the Order of Judge Dicdican was too scholarly to
be extemporaneous is merely the conjecture of respondents. This
characterization does not show in any way that he was biased or
partial. Besides, as earlier adverted to, both the Motion and the
Comment thereto had been filed days before the hearing thereon. It
is not unusual -- in fact, it is expected -- that the judge would study
the Motion and the Comment filed before him. If he prepared well
for the arguments, he should be commended, not faulted.
Besides, Judge Dicdican ruled that the issues raised in the Motion
could be determined on the basis of preponderance of evidence
[47]
presented by both parties. This means that he did not foreclose
the possibility that the parties would ventilate these defenses during
the trial.
To show his fairness, he even allowed the postponement of the
pretrial set for that hearing upon the request of respondents
counsel. This act showed that he was in no hurry to decide the case
in favor of petitioners.
As to respondents doubts arising from the alleged suspicious
appearance of the TSN of the August 11, 2003 hearing, this Court
cannot take it as an indication of partiality on the part of the judge.
Clearly, it was Atty. Jonathan G. Talabo, the branch clerk of court of
Branch 11 of the RTC of Cebu, who had issued the
[48]
Certification dated November 11, 1999. Respondents failed to
prove that Judge Dicdican had a hand in its issuance. What is clear is
that the TSN of August 11, 1998 was prepared and signed by Emelyn
V. Fuentes, stenographic reporter of Branch 11 of the RTC of Cebu.
Connecting this suddenly found TSN to Judge Dicdican is not only
speculative, but also baseless and unfair and will not suffice to bar
respondent judge from performing his lawfully mandated duty.
Admission of Petitioners Exhibits Without
indicating Respondents Objections
[49]
In his Order dated June 2, 1999, Judge Dicdican admitted the
documentary evidence of plaintiffs. He did so after petitioners had
[50]
filed their Formal Offer of Exhibits and respondents their
[51]
Comments (on Plaintiffs Exhibits). The former was filed on May 5,
1999 and the latter on May 12, 1999. He issued his Order admitting
the evidence of petitioners only on June 2, 1999 or a good 21 days
after respondents had submitted their objections to the formers
exhibits.
15
We cannot see how such an Order would translate to bias and
partiality. Respondents argue the judge should have indicated their
objections for the record. But it is clear that he indeed allowed them
to file their Comment/Objections to petitioners Formal Offer. It is
enough that he allowed both parties to be heard, and that he
decided based on their submissions.
We do not agree, either, with the appellate courts findings that
petitioners witnesses were allowed to answer all questions asked of
them, even if respondent judge had not yet ruled on the applicability
of the Statute of Frauds.
Aside from the fact that these objections are sweeping and
unsubstantiated, they should have been raised before the trial judge
himself. Respondents had every opportunity to object to the
questions the witnesses were asked and the answers the latter gave
during the trial, based on the following provision of the Rules of
Court:
Objection to a question propounded in the course of the oral
examination of a witness shall be made as soon as the grounds
[52]
therefor shall become reasonably apparent.
As to the striking out of answers, the rule on evidence (Rule 132)
provide:
SEC. 39. Striking out answer. - Should a witness answer the question
before the adverse party had the opportunity to voice fully its
objection to the same, and such objection is found to be
meritorious, the court shall sustain the objection and order the
answer given to be stricken off the record.
On proper motion, the court may also order the striking out of
answers which are incompetent, irrelevant, or otherwise
[53]
improper.
Respondents have not shown that they were in any way denied their
right to object to questions propounded in the course of the
hearing.
Denial of Requests for Postponement
and the Forced Cross-Examination of Witnesses
The CA also ruled that the denial by Judge Dicdican of the
postponements requested by respondents counsels also showed his
bias and partiality.
We disagree. A motion for continuance or postponement is not a
matter of right, but a request addressed to the sound discretion of
[54]
the court. Parties asking for postponement have absolutely no
right to assume that their motions would be granted. Thus, they
[55]
must be prepared on the day of the hearing.
Given this rule, the question of the correctness of the denial of
respondents requests for postponements was addressed to the
sound discretion of Judge Dicdican. His action thereon cannot be
disturbed by appellate courts in the absence of any clear and
manifest abuse of discretion resulting in a denial of substantial
[56]
justice. Since there was no such finding with regard to the
disallowance of the requests for postponement, the CA cannot
overturn the decision of the judge. Much less can it assume his bias
and partiality based merely on the denial of the requests for
postponement.
Moreover, respondents cannot claim that all their requests were
turned down by Judge Dicdican. This Court takes notice of the fact
that respondents asked for an extension of time to file their answer
and later asked for two postponements of the pretrial. In fact, when
the pretrial was finally set for August 11, 1998, they then filed their
Motion to Hear Affirmative Defenses. And when the judge denied it,
they again asked for a postponement of the pretrial, a request that
was readily granted by the trial court.
Respondents fault Judge Dicdican for not postponing the pretrial on
November 9, 1998, when their counsel had to represent the Cebu
Lions Club in an international conference in Japan. But they should
be aware that the court had already given them one whole month to
procure from the Court of Appeals a temporary restraining order
(TRO) to cause the suspension of the proceedings in the lower court.
So, on November 9, 1998, they were given sufficient time to prepare
for the pretrial. If their counsel learned of the date of the conference
only recently, he could have easily assigned the case to Atty. Vicente
A. Espina Jr., his co-counsel. In fact, Atty. Espina, armed with a
special power of attorney to represent respondents, was present in
court on the hearing date. He even admitted that he was able to
read the records of the case. Also, as correctly argued by petitioners
counsel, respondents had with them their pretrial briefs which could
have guided them.
As can be seen from the Pretrial Order, respondents were ably
represented by Atty. Espina. Hence, they suffered no prejudice even
if the pretrial was not postponed. The trial court observed during
the hearing:
The Court actually does not consider that as the reason to postpone
the pre-trial in this case because it seemed that there is a pattern to
delay. And the Court can not countenance that there would be no
movement of this case. There seemed to be a pattern as observed
by the Court. So we will go on with the pre-trial if there is no
[57]
possibility of an amicable settlement.
It seems that respondents have no one else to blame but themselves
for the trial courts denial of their requests for postponement.
As to the other time when the request of respondents for
postponement was denied by Judge Dicdican, this Court notes that
both their counsels -- Attys. Lim and Espina -- were present during
the preceding hearing when the dates of the succeeding hearings
[58]
were agreed upon. As stated in the TSN, the parties agreed that
the next setting would be on April 28, 1999 at 9:00 a.m. and on April
30, 1999 at 10:00 a.m. But on April 23, 1999 -- more than two
months after the trial date had been set and only five days before
the scheduled hearing -- respondents counsel filed an urgent Motion
to Reset the hearing to April 28, 1999, because both lawyers
allegedly had other commitments. Petitioners filed an Opposition to
the Motion to Reset; thus, respondent judges denial of the Motion
was not at all arbitrary or whimsical.
The appellate court also faults Judge Dicdican for allowing
petitioners to present their witnesses even in the absence of
respondents counsel and, on the succeeding hearing, for forcing the
counsel to cross-examine the witness presented previously.
As we have ruled above, parties asking for postponement have
absolutely no right to assume that their motion would be granted
[59]
and must thus be prepared on the day of the hearing. What
further militates against respondents counsel is his excuse that he
was informed by a court personnel that his Motion to Reset had
[60]
been granted. Supposedly because of this information, the
counsel was under the impression that there would be no hearing
on the last scheduled date. His assumption that his motion to reset
would be granted was bad enough. What was worse was that, in
following up the proceedings of the case, he relied on the
unauthorized communication of an unidentified court personnel. He
could have easily verified if there was a hearing, and what transpired
if it indeed there was one. This is the duty imposed upon lawyers.
Due diligence requires that lawyers should obtain timely information
from the concerned clerks of court regarding action on their
16
motions; lack of notice thereof will not necessarily make them any
[61]
less accountable for their omission.
Petitioners correctly argue thus:
x x x. Judge Dicdican then allowed the counsel for petitioners to
conduct the redirect examination of his first witness, and to conduct
the direct examination of his second witness, giving the petitioners
the opportunity to conduct the re-cross examination of said witness
and cross-examination of the second witness on April 30, 1999.
Judge Dicdican therefore was very fair and considerate to
respondents in giving them the opportunity to re-cross examine and
cross-examine petitioners witnesses instead of considering the
respondents to have waived said right which was within his
[62]
prerogative.
[63]
Indeed, the right to cross-examine may be waived. The repeated
failure of a party to cross-examine a witness is an implied waiver of
[64]
that right. Respondents in this case were afforded the
opportunity to cross and re-cross examine the other parties
witnesses. It was respondents counsel who failed to take advantage
of these opportunities.
Denial of the Motion for Inhibition
The appellate court maintains that during the hearing for
respondents Motion for Inhibition, the judge called the case before
the scheduled time.
Again, this is a claim that remains unproven and unsubstantiated.
Hence, it cannot be the extrajudicial source from which can be
inferred bias and partiality. Both parties uniformly quote the
proceedings on the hearing date for the case succeeding that on
which the Motion to Inhibit was to be heard:
COURT:
Were you here last Monday? I did not see you?
ATTY. LIM:
I was here, your Honor.
COURT:
When this case was called, there was no appearance.
COURT INTERPRETER:
He came late, Your Honor.
ATTY. LIM:
I was here, your Honor, at 10:00 oclock, your Honor, in fact, there
were still many parties around, your Honor.
COURT:
As far as the minute is concerned, it is not reflected that you were
here. When the case was called you were not here. The court could
not be at the mercy of the parties, so, the court has to act. So, the
[65]
court stand by that order. So you are not ready.
Respondents maintain that [o]n the date of said hearing, counsel for
respondents was present at 10:00 a.m. However, he learned that
the hearing of the case was called earlier upon order of Judge
Dicdican. Counsel for respondents then decided to leave the
courtroom, to inquire later, albeit unsurprised.
[66]
Without presenting any proof of their presence on the hearing date
at the designated time, the arguments of respondents counsel lose
force and credence. Such arguments become even less convincing
when validated against the records of this case. As shown by the
[67]
Minutes of the Session held on August 9, 1999 at 10:00 a.m., only
the counsels for plaintiffs [herein petitioners] were present.
It should be observed that the entries in official records made in the
performance of duty by a public officer of the Philippines or by some
other person especially enjoined by law are prima facie evidence of
[68]
the facts therein stated. This means that, in the present case,
such evidence is satisfactory, more so because it has been
uncontradicted by opposing evidence. Also, when the court
[69]
interpreter signed the Minutes of the Session, it is presumed that
official duty was regularly performed.
[70]
In any event, Judge Dicdican cannot be accused of evading the
Motion filed for his inhibition. He allowed it to be filed and even
cancelled one hearing until the resolution of that Motion. He also
[71]
allowed petitioners to file their Opposition thereto and thus
showed that he wanted to hear both sides of the issue.
[72]
We do not find the Order denying the Motion for Inhibition
arbitrary or whimsical. Respondent judge clearly explained why the
grounds for it were unjust and invalid. On the basis of his
circumspect and judicious ruling, we do not see how bias and
partiality on his part can be inferred.
Thereafter, he allowed a Motion for Reconsideration
[73]
to be filed
[74]
with the corresponding Opposition thereto.
We again emphasize that personal bias or prejudice is not proved by
the opinions the judge forms in the course of judicial proceedings, so
long as these have been based on the evidence presented and the
conduct observed by the judge, even if such opinions are later found
to be erroneous.
[75]
Declaration of the Absence
of the Possibility of a Compromise
Finally, Judge Dicdican was charged with bias, based on his pretrial
Order stating that there was no more possibility of a compromise
among the parties.
From the time the original Complaint was filed up to the date of the
pretrial, the parties had more than seven months to enter into a
compromise agreement. This was more than sufficient time. It
escapes this Court why, exactly on the day of the pretrial,
respondents suddenly informed the court that it was exploring the
possibility of a settlement. Besides, their absence during the pretrial
negated the sincerity of their desire to enter into a settlement. We
take note of the following argument of petitioners:
But Judge Dicdican did not believe in their sincerity to pursue an
amicable settlement of the case since they had already filed their
first petition for certiorari seeking the issuance of a TRO/Writ of
Preliminary [lnjunction] enjoining him from taking further
proceedings in the case below. Furthermore, they were never
[76]
present at the scheduled pre-trials and hearings of the case.
ALL TOLD, a perusal of the records of this case will reveal that
respondents failed to adduce any extrinsic evidence to prove that
Judge Dicdican had been motivated by malice or prejudice in issuing
the assailed rulings. They simply lean on his series of allegedly
adverse rulings, which they characterize as tainted with bias and
partiality. We note that his rulings resolving the various motions or
requests they had filed were all made only after considering the
arguments raised by all the parties. It is true that he erred in some of
his rulings, but such errors do not necessarily translate to prejudice.
The instances when he allegedly exhibited antagonism and partiality
against respondents and/or their counsels did not deprive them of a
fair and impartial trial.
17
The parties should be guided by the words of this Court in Pimentel
[77]
v. Salanga:
Efforts to attain fair, just and impartial trial and decision, have a
natural and alluring appeal. But, we are not licensed to indulge in
unjustified assumptions, or make a speculative approach to this
ideal. It ill behooves this Court to tar and feather a judge as biased
or prejudiced, simply because counsel for a party litigant happens to
complain against him. As applied here, respondent judge has not as
yet crossed the line that divides partiality and impartiality. He has
not thus far stepped to one side of the fulcrum. No act or conduct of
his would show arbitrariness or prejudice. Therefore, we are not to
assume what respondent judge, not otherwise legally disqualified,
will do in a case before him. x x x Prejudice is not to be presumed.
Especially if weighed against a judges legal obligation under his oath
to administer justice without respect to person and do equal right to
the poor and the rich. To disqualify or not to disqualify himself then,
[78]
as far as respondent judge is concerned, is a matter of conscience.
WHEREFORE, the Petition is hereby GRANTED and the assailed CA
Decision and Resolution REVERSED and SET ASIDE. The prayer for
the inhibition of Judge Isaias Dicdican is hereby DENIED. He
is DIRECTED to proceed with the hearing of CEB-21 854 with all
reasonably speed. No pronouncement as to costs.
SO ORDERED.
7. MANCHESTER DEVELOPMENT CORPORATION, ET
AL., petitioners,
vs.
COURT OF APPEALS, CITY LAND DEVELOPMENT CORPORATION,
STEPHEN ROXAS, ANDREW LUISON, GRACE LUISON and JOSE DE
MAISIP, respondents.
Tanjuatco, Oreta and Tanjuatco for petitioners.
Pecabar Law Offices for private respondents.
RESOLUTION
GANCAYCO, J.:
Acting on the motion for reconsideration of the resolution of the
Second Division of January 28,1987 and another motion to refer the
case to and to be heard in oral argument by the Court En Banc filed
by petitioners, the motion to refer the case to the Court en banc is
granted but the motion to set the case for oral argument is denied.
Petitioners in support of their contention that the filing fee must be
assessed on the basis of the amended complaint cite the case
of Magaspi vs. Ramolete. 1 They contend that the Court of Appeals
erred in that the filing fee should be levied by considering the
amount of damages sought in the original complaint.
The environmental facts of said case differ from the present in that
— 8
1. The Magaspi case was an action for recovery of ownership and
2
possession of a parcel of land with damages. While the present case
is an action for torts and damages and specific performance with
prayer for temporary restraining order, etc.
3 complaint was also admitted.
2. In the Magaspi case, the prayer in the complaint seeks not only
the annulment of title of the defendant to the property, the
declaration of ownership and delivery of possession thereof to
plaintiffs but also asks for the payment of actual moral, exemplary
damages and attorney's fees arising therefrom in the amounts
4
specified therein. However, in the present case, the prayer is for
the issuance of a writ of preliminary prohibitory injunction during
the pendency of the action against the defendants' announced
forfeiture of the sum of P3 Million paid by the plaintiffs for the
property in question, to attach such property of defendants that
maybe sufficient to satisfy any judgment that maybe rendered, and
after hearing, to order defendants to execute a contract of purchase
and sale of the subject property and annul defendants' illegal
forfeiture of the money of plaintiff, ordering defendants jointly and
severally to pay plaintiff actual, compensatory and exemplary
damages as well as 25% of said amounts as maybe proved during
the trial as attorney's fees and declaring the tender of payment of
the purchase price of plaintiff valid and producing the effect of
payment and to make the injunction permanent. The amount of
damages sought is not specified in the prayer although the body of
the complaint alleges the total amount of over P78 Million as
damages suffered by plaintiff.
5
3. Upon the filing of the complaint there was an honest difference of
opinion as to the nature of the action in the Magaspi case. The
complaint was considered as primarily an action for recovery of
ownership and possession of a parcel of land. The damages stated
were treated as merely to the main cause of action. Thus, the docket
fee of only P60.00 and P10.00 for the sheriff's fee were paid.
6
In the present case there can be no such honest difference of
opinion. As maybe gleaned from the allegations of the complaint as
well as the designation thereof, it is both an action for damages and
specific performance. The docket fee paid upon filing of complaint in
the amount only of P410.00 by considering the action to be merely
one for specific performance where the amount involved is not
capable of pecuniary estimation is obviously erroneous. Although
the total amount of damages sought is not stated in the prayer of
the complaint yet it is spelled out in the body of the complaint
totalling in the amount of P78,750,000.00 which should be the basis
of assessment of the filing fee.
4. When this under-re assessment of the filing fee in this case was
brought to the attention of this Court together with similar other
cases an investigation was immediately ordered by the Court.
Meanwhile plaintiff through another counsel with leave of court
filed an amended complaint on September 12, 1985 for the inclusion
of Philips Wire and Cable Corporation as co-plaintiff and by
emanating any mention of the amount of damages in the body of
the complaint. The prayer in the original complaint was maintained.
After this Court issued an order on October 15, 1985 ordering the re-
assessment of the docket fee in the present case and other cases
that were investigated, on November 12, 1985 the trial court
directed plaintiffs to rectify the amended complaint by stating the
amounts which they are asking for. It was only then that plaintiffs
specified the amount of damages in the body of the complaint in the
7
reduced amount of P10,000,000.00. Still no amount of damages
were specified in the prayer. Said amended complaint was admitted.
On the other hand, in the Magaspi case, the trial court ordered the
plaintiffs to pay the amount of P3,104.00 as filing fee covering the
damages alleged in the original complaint as it did not consider the
damages to be merely an or incidental to the action for recovery of
ownership and possession of real property. An amended complaint
was filed by plaintiff with leave of court to include the government
of the Republic as defendant and reducing the amount of damages,
and attorney's fees prayed for to P100,000.00. Said amended
9
In the Magaspi case, the action was considered not only one for
recovery of ownership but also for damages, so that the filing fee for
the damages should be the basis of assessment. Although the
payment of the docketing fee of P60.00 was found to be insufficient,
nevertheless, it was held that since the payment was the result of an
"honest difference of opinion as to the correct amount to be paid as
docket fee" the court "had acquired jurisdiction over the case and
the proceedings thereafter had were proper and regular." 10 Hence,
as the amended complaint superseded the original complaint, the
18
allegations of damages in the amended complaint should be the
basis of the computation of the filing fee. 11
In the present case no such honest difference of opinion was
possible as the allegations of the complaint, the designation and the
prayer show clearly that it is an action for damages and specific
performance. The docketing fee should be assessed by considering
the amount of damages as alleged in the original complaint.
As reiterated in the Magaspi case the rule is well-settled "that a case
is deemed filed only upon payment of the docket fee regardless of
the actual date of filing in court . 12 Thus, in the present case the
trial court did not acquire jurisdiction over the case by the payment
of only P410.00 as docket fee. Neither can the amendment of the
complaint thereby vest jurisdiction upon the Court. 13 For an legal
purposes there is no such original complaint that was duly filed
which could be amended. Consequently, the order admitting the
amended complaint and all subsequent proceedings and actions
taken by the trial court are null and void.
The Court of Appeals therefore, aptly ruled in the present case that
the basis of assessment of the docket fee should be the amount of
damages sought in the original complaint and not in the amended
complaint.
The Court cannot close this case without making the observation
that it frowns at the practice of counsel who filed the original
complaint in this case of omitting any specification of the amount of
damages in the prayer although the amount of over P78 million is
alleged in the body of the complaint. This is clearly intended for no
other purpose than to evade the payment of the correct filing fees if
not to mislead the docket clerk in the assessment of the filing fee.
This fraudulent practice was compounded when, even as this Court
had taken cognizance of the anomaly and ordered an investigation,
petitioner through another counsel filed an amended complaint,
deleting all mention of the amount of damages being asked for in
the body of the complaint. It was only when in obedience to the
order of this Court of October 18, 1985, the trial court directed that
the amount of damages be specified in the amended complaint, that
petitioners' counsel wrote the damages sought in the much reduced
amount of P10,000,000.00 in the body of the complaint but not in
the prayer thereof. The design to avoid payment of the required
docket fee is obvious.
The Court serves warning that it will take drastic action upon a
repetition of this unethical practice.
To put a stop to this irregularity, henceforth all 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 bib
accepted nor admitted, or shall otherwise be expunged from the
record.
The Court acquires jurisdiction over any case only upon the payment
of the prescribed docket fee. An 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 amounts sought in
the amended pleading. The ruling in the Magaspi case 14 in so far as
it is inconsistent with this pronouncement is overturned and
reversed.
WHEREFORE, the motion for reconsideration is denied for lack of
merit.
SO ORDERED.
8. SUN INSURANCE OFFICE, LTD., (SIOL), E.B. PHILIPPS and D.J.
WARBY, petitioners,
vs.
HON. MAXIMIANO C. ASUNCION, Presiding Judge, Branch 104,
Regional Trial Court, Quezon City and MANUEL CHUA UY PO
TIONG, respondents.
Romulo, Mabanta, Buenaventura, Sayoc & De los Angeles Law
Offices for petitioners. Tanjuatco, Oreta, Tanjuatco, Berenguer &
Sanvicente Law Offices for private respondent.
GANCAYCO, J.:
Again the Court is asked to resolve the issue of whether or not a
court acquires jurisdiction over a case when the correct and proper
docket fee has not been paid.
On February 28, 1984, petitioner Sun Insurance Office, Ltd. (SIOL for
brevity) filed a complaint with the Regional Trial Court of Makati,
Metro Manila for the consignation of a premium refund on a fire
insurance policy with a prayer for the judicial declaration of its
nullity against private respondent Manuel Uy Po Tiong. Private
respondent as declared in default for failure to file the required
answer within the reglementary period.
On the other hand, on March 28, 1984, private respondent filed a
complaint in the Regional Trial Court of Quezon City for the refund
of premiums and the issuance of a writ of preliminary attachment
which was docketed as Civil Case No. Q-41177, initially against
petitioner SIOL, and thereafter including E.B. Philipps and D.J. Warby
as additional defendants. The complaint sought, among others, the
payment of actual, compensatory, moral, exemplary and liquidated
damages, attorney's fees, expenses of litigation and costs of the suit.
Although the prayer in the complaint did not quantify the amount of
damages sought said amount may be inferred from the body of the
complaint to be about Fifty Million Pesos (P50,000,000.00).
Only the amount of P210.00 was paid by private respondent as
docket fee which prompted petitioners' counsel to raise his
objection. Said objection was disregarded by respondent Judge Jose
P. Castro who was then presiding over said case. Upon the order of
this Court, the records of said case together with twenty-two other
cases assigned to different branches of the Regional Trial Court of
Quezon City which were under investigation for under-assessment
of docket fees were transmitted to this Court. The Court thereafter
returned the said records to the trial court with the directive that
they be re-raffled to the other judges in Quezon City, to the
exclusion of Judge Castro. Civil Case No. Q-41177 was re-raffled to
Branch 104, a sala which was then vacant.
On October 15, 1985, the Court en banc issued a Resolution in
Administrative Case No. 85-10-8752-RTC directing the judges in said
cases to reassess the docket fees and that in case of deficiency, to
order its payment. The Resolution also requires all clerks of court to
issue certificates of re-assessment of docket fees. All litigants were
likewise required to specify in their pleadings the amount sought to
be recovered in their complaints.
On December 16, 1985, Judge Antonio P. Solano, to whose sala Civil
Case No. Q-41177 was temporarily assigned, issuedan order to the
Clerk of Court instructing him to issue a certificate of assessment of
the docket fee paid by private respondent and, in case of deficiency,
to include the same in said certificate.
On January 7, 1984, to forestall a default, a cautionary answer was
filed by petitioners. On August 30,1984, an amended complaint was
filed by private respondent including the two additional defendants
aforestated.
19
Judge Maximiano C. Asuncion, to whom Civil Case No. Q41177 was
thereafter assigned, after his assumption into office on January 16,
1986, issued a Supplemental Order requiring the parties in the case
to comment on the Clerk of Court's letter-report signifying her
difficulty in complying with the Resolution of this Court of October
15, 1985 since the pleadings filed by private respondent did not
indicate the exact amount sought to be recovered. On January 23,
1986, private respondent filed a "Compliance" and a "Re-Amended
Complaint" stating therein a claim of "not less than Pl0,000,000. 00
as actual compensatory damages" in the prayer. In the body of the
said second amended complaint however, private respondent
alleges actual and compensatory damages and attorney's fees in the
total amount of about P44,601,623.70.
On January 24, 1986, Judge Asuncion issued another Order
admitting the second amended complaint and stating therein that
the same constituted proper compliance with the Resolution of this
Court and that a copy thereof should be furnished the Clerk of Court
for the reassessment of the docket fees. The reassessment by the
Clerk of Court based on private respondent's claim of "not less than
P10,000,000.00 as actual and compensatory damages" amounted to
P39,786.00 as docket fee. This was subsequently paid by private
respondent.
Petitioners then filed a petition for certiorari with the Court of
Appeals questioning the said order of Judie Asuncion dated January
24, 1986.
On April 24, 1986, private respondent filed a supplemental
complaint alleging an additional claim of P20,000,000.00 as
d.qmages so the total claim amounts to about P64,601,623.70. On
October 16, 1986, or some seven months after filing the
supplemental complaint, the private respondent paid the additional
docket fee of P80,396.00.
1 Plaintiff deposited the additional P8.00 to complete the amount of
On August 13, 1987, the Court of Appeals rendered a decision ruling,
among others, as follows:
WHEREFORE, judgment is hereby rendered:
1. Denying due course to the petition in CA-G.R. SP No. 1, 09715
insofar as it seeks annulment of the order
(a) denying petitioners' motion to dismiss the complaint, as
amended, and
(b) granting the writ of preliminary attachment, but giving due
course to the portion thereof questioning the reassessment of the
docketing fee, and requiring the Honorable respondent Court to
reassess the docketing fee to be paid by private respondent on the
2 fee was paid on May 23, 1956.
basis of the amount of P25,401,707.00.
Hence, the instant petition.
During the pendency of this petition and in conformity with the said
judgment of respondent court, private respondent paid the
3 Instance, within the one-week period after the proclamation as
additional docket fee of P62,432.90 on April 28, 1988.
The main thrust of the petition is that the Court of Appeals erred in
not finding that the lower court did not acquire jurisdiction over Civil
Case No. Q-41177 on the ground of nonpayment of the correct and
proper docket fee. Petitioners allege that while it may be true that
private respondent had paid the amount of P182,824.90 as docket
fee as herein-above related, and considering that the total amount
sought to be recovered in the amended and supplemental complaint
is P64,601,623.70 the docket fee that should be paid by private
respondent is P257,810.49, more or less. Not having paid the same,
petitioners contend that the complaint should be dismissed and all
incidents arising therefrom should be annulled. In support of their
theory, petitioners cite the latest ruling of the Court in Manchester
4
Development Corporation vs. CA, as follows:
The Court acquires jurisdiction over any case only upon the payment
of the prescribed docket fee. An 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 amounts sought in
the amended pleading. The ruling in the Magaspi Case in so far as it
is inconsistent with this pronouncement is overturned and reversed.
On the other hand, private respondent claims that the ruling
in Manchester cannot apply retroactively to Civil Case No. Q41177
for at the time said civil case was filed in court there was no
such Manchester ruling as yet. Further, private respondent avers
that what is applicable is the ruling of this Court in Magaspi v.
5
Ramolete, wherein this Court held that the trial court acquired
jurisdiction over the case even if the docket fee paid was
insufficient.
The contention that Manchester cannot apply retroactively to this
case is untenable. Statutes regulating the procedure of the courts
will be construed as applicable to actions pending and
undetermined at the time of their passage. Procedural laws are
6
retrospective in that sense and to that extent.
7
In Lazaro vs. Endencia and Andres, this Court held that the
payment of the full amount of the docket fee is an indispensable
step for the perfection of an appeal. In a forcible entry and detainer
case before the justice of the peace court of Manaoag, Pangasinan,
after notice of a judgment dismissing the case, the plaintiff filed a
notice of appeal with said court but he deposited only P8.00 for the
docket fee, instead of P16.00 as required, within the reglementary
period of appeal of five (5) days after receiving notice of judgment.
the docket fee only fourteen (14) days later. On the basis of these
facts, this court held that the Court of First Instance did notacquire
jurisdiction to hear and determine the appeal as the appeal was not
thereby perfected.
8
In Lee vs. Republic, the petitioner filed a verified declaration of
intention to become a Filipino citizen by sending it through
registered mail to the Office of the Solicitor General in 1953 but the
required filing fee was paid only in 1956, barely 5V2 months prior to
the filing of the petition for citizenship. This Court ruled that the
declaration was not filed in accordance with the legal requirement
that such declaration should be filed at least one year before the
filing of the petition for citizenship. Citing Lazaro, this Court
concluded that the filing of petitioner's declaration of intention on
October 23, 1953 produced no legal effect until the required filing
9
In Malimit vs. Degamo, the same principles enunciated in Lazaro
and Lee were applied. It was an original petition for quo
warranto contesting the right to office of proclaimed candidates
which was mailed, addressed to the clerk of the Court of First
10
provided therefor by law. However, the required docket fees were
paid only after the expiration of said period. Consequently, this
Court held that the date of such payment must be deemed to be the
real date of filing of aforesaid petition and not the date when it was
mailed.
11
Again, in Garica vs, Vasquez, this Court reiterated the rule that the
docket fee must be paid before a court will act on a petition or
complaint. However, we also held that said rule is not applicable
when petitioner seeks the probate of several wills of the same
decedent as he is not required to file a separate action for each will
but instead he may have other wills probated in the same special
proceeding then pending before the same court.
20
 12
Then in Magaspi, this Court reiterated the ruling
in Malimit and Lee that a case is deemed filed only upon payment of
the docket fee regardless of the actual date of its filing in court. Said
case involved a complaint for recovery of ownership and possession
of a parcel of land with damages filed in the Court of First Instance
of Cebu. Upon the payment of P60.00 for the docket fee and P10.00
for the sheriffs fee, the complaint was docketed as Civil Case No. R-
11882. The prayer of the complaint sought that the Transfer
Certificate of Title issued in the name of the defendant be declared
as null and void. It was also prayed that plaintiff be declared as
owner thereof to whom the proper title should be issued, and that
defendant be made to pay monthly rentals of P3,500.00 from June
2, 1948 up to the time the property is delivered to plaintiff,
P500,000.00 as moral damages, attorney's fees in the amount of
P250,000.00, the costs of the action and exemplary damages in the
amount of P500,000.00.
The defendant then filed a motion to compel the plaintiff to pay the
correct amount of the docket fee to which an opposition was filed
by the plaintiff alleging that the action was for the recovery of a
parcel of land so the docket fee must be based on its assessed value
and that the amount of P60.00 was the correct docketing fee. The
trial court ordered the plaintiff to pay P3,104.00 as filing fee.
The plaintiff then filed a motion to admit the amended complaint to
include the Republic as the defendant. In the prayer of the amended
complaint the exemplary damages earlier sought was eliminated.
The amended prayer merely sought moral damages as the court
may determine, attorney's fees of P100,000.00 and the costs of the
action. The defendant filed an opposition to the amended
complaint. The opposition notwithstanding, the amended complaint
was admitted by the trial court. The trial court reiterated its order
for the payment of the additional docket fee which plaintiff assailed
and then challenged before this Court. Plaintiff alleged that he paid
the total docket fee in the amount of P60.00 and that if he has to
pay the additional fee it must be based on the amended complaint.
The question posed, therefore, was whether or not the plaintiff may
be considered to have filed the case even if the docketing fee paid
was not sufficient. In Magaspi, We reiterated the rule that the case
was deemed filed only upon the payment of the correct amount for
the docket fee regardless of the actual date of the filing of the
complaint; that there was an honest difference of opinion as to the
correct amount to be paid as docket fee in that as the action
appears to be one for the recovery of property the docket fee of
P60.00 was correct; and that as the action is also one, for damages,
We upheld the assessment of the additional docket fee based on the
damages alleged in the amended complaint as against the
assessment of the trial court which was based on the damages
alleged in the original complaint.
However, as aforecited, this Court
overturned Magaspi in Manchester. Manchester involves an action
for torts and damages and specific performance with a prayer for
the issuance of a temporary restraining order, etc. The prayer in said
case is for the issuance of a writ of preliminary prohibitory injunction
during the pendency of the action against the defendants'
announced forfeiture of the sum of P3 Million paid by the plaintiffs
for the property in question, the attachment of such property of
defendants that may be sufficient to satisfy any judgment that may
be rendered, and, after hearing, the issuance of an order requiring
defendants to execute a contract of purchase and sale of the subject
property and annul defendants' illegal forfeiture of the money of
plaintiff. It was also prayed that the defendants be made to pay the
plaintiff jointly and severally, actual, compensatory and exemplary
damages as well as 25% of said amounts as may be proved during
the trial for attorney's fees. The plaintiff also asked the trial court to
declare the tender of payment of the purchase price of plaintiff valid
and sufficient for purposes of payment, and to make the injunction
permanent. The amount of damages sought is not specified in the
prayer although the body of the complaint alleges the total amount
of over P78 Millon allegedly suffered by plaintiff.
Upon the filing of the complaint, the plaintiff paid the amount of
only P410.00 for the docket fee based on the nature of the action
for specific performance where the amount involved is not capable
of pecuniary estimation. However, it was obvious from the
allegations of the complaint as well as its designation that the action
was one for damages and specific performance. Thus, this court held
the plaintiff must be assessed the correct docket fee computed
against the amount of damages of about P78 Million, although the
same was not spelled out in the prayer of the complaint.
Meanwhile, plaintiff through another counsel, with leave of court,
filed an amended complaint on September 12, 1985 by the inclusion
of another co-plaintiff and eliminating any mention of the amount of
damages in the body of the complaint. The prayer in the original
complaint was maintained.
On October 15, 1985, this Court ordered the re-assessment of the
docket fee in the said case and other cases that were investigated.
On November 12, 1985, the trial court directed the plaintiff to rectify
the amended complaint by stating the amounts which they were
asking for. This plaintiff did as instructed. In the body of the
complaint the amount of damages alleged was reduced to
P10,000,000.00 but still no amount of damages was specified in the
prayer. Said amended complaint was admitted.
Applying the principle in Magaspi that "the case is deemed filed only
upon payment of the docket fee regardless of the actual date of
filing in court," this Court held that the trial court did not acquire
jurisdiction over the case by payment of only P410.00 for the docket
fee. Neither can the amendment of the complaint thereby vest
jurisdiction upon the Court. For all legal purposes there was no such
original complaint duly filed which could be amended.
Consequently, the order admitting the amended complaint and all
subsequent proceedings and actions taken by the trial court were
13
declared null and void.
The present case, as above discussed, is among the several cases of
under-assessment of docket fee which were investigated by this
Court together with Manchester. The facts and circumstances of this
case are similar to Manchester. In the body of the original complaint,
the total amount of damages sought amounted to about P50
Million. In the prayer, the amount of damages asked for was not
stated. The action was for the refund of the premium and the
issuance of the writ of preliminary attachment with damages. The
amount of only P210.00 was paid for the docket fee. On January 23,
1986, private respondent filed an amended complaint wherein in
the prayer it is asked that he be awarded no less than
P10,000,000.00 as actual and exemplary damages but in the body of
the complaint the amount of his pecuniary claim is approximately
P44,601,623.70. Said amended complaint was admitted and the
private respondent was reassessed the additional docket fee of
P39,786.00 based on his prayer of not less than P10,000,000.00 in
damages, which he paid.
On April 24, 1986, private respondent filed a supplemental
complaint alleging an additional claim of P20,000,000.00 in damages
so that his total claim is approximately P64,601,620.70. On October
16, 1986, private respondent paid an additional docket fee of
P80,396.00. After the promulgation of the decision of the
respondent court on August 31, 1987 wherein private respondent
was ordered to be reassessed for additional docket fee, and during
the pendency of this petition, and after the promulgation
of Manchester, on April 28, 1988, private respondent paid an
additional docket fee of P62,132.92. Although private respondent
appears to have paid a total amount of P182,824.90 for the docket
21
fee considering the total amount of his claim in the amended and
supplemental complaint amounting to about P64,601,620.70,
petitioner insists that private respondent must pay a docket fee of
P257,810.49.
The principle in Manchester could very well be applied in the
present case. The pattern and the intent to defraud the government
of the docket fee due it is obvious not only in the filing of the
original complaint but also in the filing of the second amended
complaint.
However, in Manchester, petitioner did not pay any additional
docket fee until] the case was decided by this Court on May 7, 1987.
Thus, in Manchester, due to the fraud committed on the
government, this Court held that the court a quo did not acquire
jurisdiction over the case and that the amended complaint could not
have been admitted inasmuch as the original complaint was null and
void.
In the present case, a more liberal interpretation of the rules is
called for considering that, unlike Manchester, private respondent
demonstrated his willingness to abide by the rules by paying the
additional docket fees as required. The promulgation of the decision
in Manchester must have had that sobering influence on private
respondent who thus paid the additional docket fee as ordered by
the respondent court. It triggered his change of stance by
manifesting his willingness to pay such additional docket fee as may
be ordered.
Nevertheless, petitioners contend that the docket fee that was paid
is still insufficient considering the total amount of the claim. This is a
matter which the clerk of court of the lower court and/or his duly
authorized docket clerk or clerk in-charge should determine and,
thereafter, if any amount is found due, he must require the private
respondent to pay the same.
Thus, the Court rules as follows:
1. 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. Where the filing of the initiatory pleading is not accompanied
by payment of the docket fee, the court may allow payment of the
fee within a reasonable time but in no case beyond the applicable
prescriptive or reglementary period.
2. The same rule applies to permissive counterclaims, third party
claims and similar pleadings, which shall not be considered filed until
and unless the filing fee prescribed therefor is paid. The court may
also allow payment of said fee within a reasonable time but also in
no case beyond its applicable prescriptive or reglementary period.
3. Where the trial court acquires jurisdiction over a claim by the
filing of the appropriate pleading and payment of the prescribed
filing fee but, subsequently, the judgment awards a claim not
specified in the pleading, or if specified the same has been left for
determination by the court, the additional filing fee therefor shall
constitute a lien on the judgment. It shall be the responsibility of the
Clerk of Court or his duly authorized deputy to enforce said lien and
assess and collect the additional fee.
WHEREFORE, the petition is DISMISSED for lack of merit. The Clerk
of Court of the court a quo is hereby instructed to reassess and
determine the additional filing fee that should be paid by private
respondent considering the total amount of the claim sought in the
original complaint and the supplemental complaint as may be
gleaned from the allegations and the prayer thereof and to require
private respondent to pay the deficiency, if any, without
pronouncement as to costs.
SO ORDERED.
9. MAXIMO TACAY, PONCIANO PANES and ANTONIA
NOEL, petitioners,
vs.
REGIONAL TRIAL COURT OF TAGUM Davao del Norte, Branches 1
and 2, Presided by Hon. Marcial Fernandez and Hon. Jesus Matas,
respectively, PATSITA GAMUTAN, Clerk of Court, and GODOFREDO
PINEDA, respondents.
Eduardo C. De Vera for petitioners.
RESOLUTION
NARVASA, J.:
1
In the Regional Trial Court at Tagum, Davao del Norte, three
2
(3) actions for recovery of possession (acciones publicianas ) were
separately instituted by Godofredo Pineda against three (3)
defendants, docketed as follows:
1) vs. Antonia Noel Civil Case No. 2209
2) vs. Ponciano Panes Civil Case No. 2210
3) vs. Maximo Tacay Civil Case No. 2211.
Civil Cases Numbered 2209 and 2211 were raffled to Branch I of the
Trial Court, presided over by Judge Marcial Hernandez. Civil No.
2210 was assigned to Branch 2, presided over by Judge Jesus Matas.
3
The complaints all alleged the same essential facts (1) Pineda was
the owner of a parcel of land measuring 790 square meters, his
ownership being evidenced by TCT No. T-46560; (2) the previous
owner had allowed the defendants to occupy portions of the land by
mere tolerance; (3) having himself need to use the property, Pineda
had made demands on the defendants to vacate the property and
pay reasonable rentals therefor, but these demands had been
refused; and (4) the last demand had been made more than a year
prior to the commencement of suit. The complaints prayed for the
same reliefs, to wit:
1) that plaintiff be declared owner of the areas occupied by the
defendants;
2) that defendants and their "privies and allies" be ordered to vacate
and deliver the portions of the land usurped by them;
3) that each defendant be ordered to pay:
1 ) P 2,000 as monthly rents from February, 1987;
2 ) Actual damages, as proven;
3 ) Moral and nominal damages as the Honorable Court may fix ;
4) P30,000.00, "as attorney's fees, and representation fees of
4
P5,000.00 per day of appearance;"
and
4) that he (Pineda) be granted such "further relief and remedies ...
just and equitable in the premises.
The prayer of each complaint contained a handwritten notation
(evidently made by plaintiff's counsel) reading, "P5,000.00 as and
for," immediately above the typewritten words, "Actual damages, as
proven," the intention apparently being to make the entire phrase
read, " P5,000.00 as and for actual damages as proven.
5
22
Motions to dismiss were filed in behalf of each of the defendants by jurisdiction in this type of actions is the nature thereof, not the
6
common counsel . Every motion alleged that the Trial Court had amount of the damages allegedly arising from or connected with the
not acquired jurisdiction of the case — issue of title or possession, and regardless of the value of the
property. Quite obviously, an action for recovery of possession of
. . . for the reason that the ... complaint violates the mandatory and real property (such as an accion plenaria de possesion) or the title
clear provision of Circular No. 7 of the ... Supreme Court dated 12
thereof, or for partition or condemnation of, or the foreclosure of
March 24,1988, by failing to specify all the amounts of damages 13
a mortgage on, said real property - in other words, a real action-
which plaintiff is claiming from defendant;" and may be commenced and prosecuted without an accompanying claim
for actual, moral, nominal or exemplary damages; and such an
. . . for ... failure (of the complaint) to even allege the basic
action would fall within the exclusive, original jurisdiction of the
requirement as to the assessed value of the subject lot in dispute.
Regional Trial Court.
Judge Matas denied the motion to dismiss filed in Civil Case No.
Batas Pambansa Bilang 129 provides that Regional Trial Courts shall
2210 but ordered the expunction of the "allegations in paragraph 11
exercise exclusive original jurisdiction inter alia over "all civil actions
of the ... complaint regarding moral as well as nominal damages
7 which involve the title to, or possession of, real property, or any
. On motion of defendant Panes, Judge Matas later ordered the
interest therein, except actions for forcible entry into and unlawful
striking out, too, of the "handwritten amount of 'P5,000. 00 as and
detainer of lands or buildings, original jurisdiction over which is
for.' including the typewritten words 'actual damages as proven' ...
conferred upon Metropolitan Trial Courts, Municipal Trial Courts,
in sub-paragraph b of paragraph 4 in the conclusion and prayer of 14
8 and Municipal Circuit Trial Courts." The rule applies regardless of
the complaint ..."
the value of the real property involved, whether it be worth more
than P20,000.00 or not, infra. The rule also applies even where the
The motions to dismiss submitted in Civil Cases Numbered 2211 and
complaint involving realty also prays for an award of damages; the
2209 were also denied in separate orders promulgated by Judge
9 amount of those damages would be immaterial to the question of
Marcial Fernandez. His Order in Case No. 2209 dated March 15,
the Court's jurisdiction. The rule is unlike that in other cases e.g.,
1989 (a) declared that since the "action at bar is for Reivindicatoria, 15
actions simply for recovery of money or of personal property, or
Damages and Attorney's fees ... (d)efinitely this Court has the 16
actions in admiralty and maritime jurisdiction in which the amount
exclusive jurisdiction," (b) that the claims for actual, moral and 17
claimed, or the value of the personal property, is determinative of
nominal damages "are only one aspect of the cause of action," and
jurisdiction; i.e., the value of the personal property or the amount
(c) because of absence of specification of the amounts claimed as
claimed should exceed twenty thousand pesos (P20,000.00) in order
moral, nominal and actual damages, they should be "expunged from
to be cognizable by the Regional Trial Court.
the records."
Circular No. 7 of this Court, dated March 24, 1988, cannot thus be
Ascribing grave abuse of discretion to both Judges Matas and
invoked, as the petitioner does, as authority for the dismissal of the
Fernandez in the rendition of the Orders above described, the
actions at bar. That circular, avowedly inspired by the doctrine laid
defendants in all three (3) actions have filed with this Court a "Joint
down in Manchester Development Corporation v. Court of
Petition" for certiorari, prohibition and mandamus, with prayer for
appeals, 149 SCRA 562 (May 7, 1987), has but limited application to
temporary restraining order and/or writ of preliminary prohibitory
said actions, as shall presently be discussed. Moreover, the rules
injunction," praying essentially that said orders be annulled and
therein laid down have since been clarified and amplified by the
respondent judges directed to dismiss all the complaints "without
Court's subsequent decision in Sun Insurance Office, Ltd. (SIOL) v.
prejudice to private respondent Pineda's re-filing a similar complaint
Asuncion, et al., G.R. Nos. 79937-38, February 13, 1989.
that complies with Circular No. 7." The joint petition (a) re-asserted
the proposition that because the complaints had failed to state the
Circular No. 7 was aimed at the practice of certain parties who omit
amounts being claimed as actual, moral and nominal damages, the
from the prayer of their complaints "any specification of the amount
Trial Courts a quo had not acquired jurisdiction over the three (3)
of damages," the omission being "clearly intended for no other
actions in question-indeed, the respondent Clerk of Court should not
purposes than to evade the payment of the correct filing fees if not
have accepted the complaints which initiated said suits, and (b) it
to mislead the docket clerk, in the assessment of the filing fee." The
was not proper merely to expunge the claims for damages and allow
following rules were therefore set down:
"the so-called cause of action for "reivindicatoria" remain for trial"
10
by itself. 1. All complaints, petitions, answers, and similar pleadings should
specify the amount of damages being prayed for not only in the
The joint petition should be, as it is hereby, dismissed.
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.
It should be dismissed for failure to comply with this Court's Circular
No. 1-88 (effective January 1, 1989). The copies of the challenged
11 2. Any pleading that fails to comply with this requirement shall not
Orders thereto attached were not certified by the proper Clerk of
be accepted nor admitted, or shall otherwise be expunged from the
Court or his duly authorized representative. Certification was made
record.
by the petitioners' counsel, which is not allowed.
3. The Court acquires jurisdiction over any case only upon the
The petition should be dismissed, too, for another equally important
payment of the prescribed docket fee. An amendment of the
reason. It fails to demonstrate any grave abuse of discretion on the
complaint or similar pleading will not thereby vest jurisdiction in the
part of the respondent Judges in rendering the Orders complained
Court, much less the payment of the docket fee based on the
of or, for that matter, the existence of any proper cause for the
amount sought in the amended pleading.
issuance of the writ of mandamus. On the contrary, the orders
appear to have correctly applied the law to the admitted facts. The clarificatory and additional rules laid down in Sun Insurance
Office, Ltd. v. Asuncion, supra, read as follows:
It is true that the complaints do not state the amounts being claimed
as actual, moral and nominal damages. It is also true, however, that 1. It is not simply the filing of the complaint or appropriate initiatory
the actions are not basically for the recovery of sums of money. pleading, but (also) the payment of the prescribed docket fee that
They are principally for recovery of possession of real property, in vests a trial court with jurisdiction over the subject-matter or nature
the nature of an accion publiciana. Determinative of the court's of the action. Where the filing of the initiatory pleading is not
23
accompanied by payment of the docket fee, the court may allow
payment of the fee within a reasonable time but in no case beyond
the applicable prescriptive or reglementary period.
2. The same rule applies to permissive counterclaims, third-party
claims and similar pleadings, which shall not be considered filed until
and unless the filing fee prescribed therefor is paid. The court may
also allow payment of said fee within a reasonable time but also in
no case beyond its applicable prescriptive or reglementary period.
3. Where the trial court acquires jurisdiction over a claim by the
filing of the appropriate pleading and payment of the prescribed
filing fee but, subsequently, the judgment awards a claim not
specified in the pleading, or if specified, the same has been left for
determination by the court, the additional filing fee therefor shall
constitute a lien on the judgment. It shall be the responsibility of the
Clerk of Court or his duly authorized deputy to enforce said lien and
assess and collect the additional fee.
As will be noted, the requirement in Circular No. 7 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 or reglementary period. Moreover, a new
rule has been added, governing 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 therefor 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
18
other. There are, in other words, as already above intimated,
actions or proceedings involving real property, in which the value of
the property is immaterial to the court's jurisdiction, account
thereof being taken merely for assessment of the legal fees; and
there are actions or proceedings, involving personal property or the
recovery of money and/or damages, in which the value of the
property or the amount of the demand is decisive of the trial court's
competence (aside from being the basis for fixing the corresponding
19
docket fees).
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 the filing fees in
any case."
Two situations may arise. One is where the complaint or similar
pleading sets out a claim purely for money or damages and there is
no precise 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
the 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.
Where the action involves real property and a related claim for
damages as well, the legal fees shall be assessed on the basis of both
(a) the value of the property and (b) the total amount of related
damages sought. The Court acquires jurisdiction over the action if
the filing of the initiatory pleading is accompanied by the payment
of the requisite fees, or, if the fees are not paid at the time of the
filing of the pleading, as of the time of full payment of the fees
within such reasonable time as the court may grant, unless, of
course, prescription has set in the meantime. But where-as in the
case at bar-the fees prescribed for an action involving real property
have been paid, but the amounts of certain of the related damages
(actual, moral and nominal) being demanded are unspecified, the
action may not be dismissed. The Court undeniably has jurisdiction
over the action involving the real property, acquiring it upon the
filing of the complaint or similar pleading and payment of the
prescribed fee. And it is not divested of that authority by the
circumstance that it may not have acquired jurisdiction over the
accompanying claims for damages because of lack of specification
thereof. What should be done is simply to expunge those claims for
damages as to which no amounts are stated, which is what the
respondent Courts did, or allow, on motion, a reasonable time for
the amendment of the complaints so as to allege the precise amount
of each item of damages and accept payment of the requisite fees
therefor within the relevant prescriptive period.
WHEREFORE, the petition is DISMISSED, without pronouncement as
to costs.
10. AYALA CORPORATION, LAS PIÑAS VENTURES, INC., and
FILIPINAS LIFE ASSURANCE COMPANY, INC., petitioners
vs.
THE HONORABLE JOB B. MADAYAG, PRESIDING JUDGE, REGIONAL
TRIAL COURT, NATIONAL CAPITAL JUDICIAL REGION, BRANCH 145
and THE SPOUSES CAMILO AND MA. MARLENE
SABIO, respondents.
Renato L. De la Fuente for petitioners.
Camilo L. Sabio for private respondents.
GANCAYCO, J.:
Once more the issue relating to the payment of filing fees in an
action for specific performance with damages is presented by this
petition for prohibition.
Private respondents filed against petitioners an action for specific
performance with damages in the Regional Trial Court of Makati.
Petitioners filed a motion to dismiss on the ground that the lower
court has not acquired jurisdiction over the case as private
respondents failed to pay the prescribed docket fee and to specify
the amount of exemplary damages both in the body and prayer of
the amended and supplemental complaint. The trial court denied
the motion in an order dated April 5, 1989. A motion for
reconsideration filed by petitioners was likewise denied in an order
dated May 18, 1989. Hence this petition.
The main thrust of the petition is that private respondent paid only
the total amount of P l,616.00 as docket fees instead of the amount
of P13,061.35 based on the assessed value of the real properties
involved as evidenced by its tax declaration. Further, petitioners
contend that private respondents failed to specify the amount of
24
exemplary damages sought both in the body and the prayer of the
amended and supplemental complaint.
1
In Manchester Development Corporation vs. Court of Appeals a
similar case involving an action for specific performance with
damages, this Court held that the docket fee should be assessed by
considering the amount of damages as alleged in the original
complaint.
However, the contention of petitioners is that since the action
concerns real estate, the assessed value thereof should be
considered in computing the fees pursuant to Section 5, Rule 141 of
the Rules of Court. Such rule cannot apply to this case which is an
action for specific performance with damages although it is in
relation to a transaction involving real estate. Pursuant
to Manchester, the amount of the docket fees to be paid should be
computed on the basis of the amount of damages stated in the
complaint.
Petitioners also allege that because of the failure of the private
respondents to state the amount of exemplary damages being
sought, the complaint must nevertheless be dismissed in accordance
to Manchester. The trial court denied the motion stating that the
determination of the exemplary damages is within the sound
discretion of the court and that it would be unwarrantedly
presumptuous on the part of the private respondents to fix the
amount of exemplary damages being prayed for. The trial court cited
2
the subsequent case of Sun Insurance vs. Judge Asuncion in support
of its ruling.
The clarificatory and additional rules laid down in Sun Insurance are
as follows:
1. It is not simply the filing of the complaint or appropriate initiatory
pleading, but (also) the payment of the prescribed docket fee that
vests a trial court with jurisdiction over the subject-matter or nature
of the action. Where the filing of the initiatory pleading is not
accompanied by payment of the docket fee, the court may allow
payment of the fee within a reasonable tune but in no case beyond
the applicable prescriptive or reglementary period.
2. The same rule applies to permissive counterclaims, third party
claims and similar pleadings, which shall not be considered filed until
and unless the filing fee prescribed therefor is paid. The court may
also allow payment of said fee within a reasonable time but also in
no case beyond its applicable prescriptive or reglementary period.
3. Where the trial court acquires jurisdiction over a claim by the
filing of the appropriate pleading and payment of the prescribed
filing fee but, subsequently, the judgment awards a claim not
specified in the pleading, or if specified, the same has been left for
determination by the court, the additional filing fee therefor shall
constitute a lien on the judgment. It shall be the responsibility of the
Clerk of Court or his duly authorized deputy to enforce said lien and
assess and collect the additional fee.
Apparently, the trial court misinterpreted paragraph 3 of the above
ruling of this Court wherein it is 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, say for exemplary or corrective damages, 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.
3 of Campos to file the correct filing fee. According to
In the latest case Tacay vs. Regional Trial Court of Tagum, this
Court had occasion to make the clarification that the phrase "awards
of claims not specified in the pleading" refers only to "damages
arising after the filing of the complaint or similar pleading . . . as to
which the additional filing fee therefor shall constitute a lien on the
judgment." The amount of any claim for damages, therefore, arising
on or before the filing of the complaint or any pleading, should be
specified. While it is true that the determination of certain damages
as exemplary or corrective damages 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.
The amended and supplemental complaint in the present case,
therefore, suffers from the material defect in failing to state the
amount of exemplary damages prayed for.
As ruled in Tacay the trial court may either order said claim to be
expunged from the record as it did not acquire jurisdiction over the
same or on motion, it may allow, within a reasonable time, the
amendment of the amended and supplemental complaint so as to
state the precise amount of the exemplary damages sought and
require the payment of the requisite fees therefor within the
relevant prescriptive period.
4
WHEREFORE, the petition is GRANTED. The trial court is directed
either to expunge from the record the claim for exemplary damages
in the amended and supplemental complaint, the amount of which
is not specified, or it may otherwise, upon motion, give reasonable
time to private respondents to amend their pleading by specifying
its amount and paying the corresponding docketing fees within the
appropriate reglementary or prescriptive period. No costs.
SO ORDERED.
11. NEGROS ORIENTAL PLANTERS ASSOCIATION, INC. (NOPA) vs
HON. PRESIDING JUDGE OF RTC-NEGROS OCCIDENTAL, BRANCH 52,
BACOLOD CITY, and ANICETO MANOJO CAMPOS,
DECISION
CHICO-NAZARIO, J.:
Whats sauce for the goose is sauce for the gander.
This is a Petition for Review on Certiorari seeking the reversal of the
[1]
Resolutions of the Court of Appeals dated 23 May 2007 and 16
August 2007, respectively, in CA-G.R. SP No. 02651 outrightly
dismissing the Petition for Certiorari filed by petitioner Negros
Oriental Planters Association, Inc. (NOPA) against private
respondent Aniceto Manojo Campos (Campos).
On 17 March 1999, Campos filed a Complaint for Breach of Contract
with Damages, docketed as Civil Case No. 99-10773, against NOPA
before the Regional Trial Court (RTC) of Negros
Occidental, Bacolod City. According to the Complaint, Campos and
NOPA entered into two separate contracts denominated as
Molasses Sales Agreement.Campos allegedly paid the consideration
of the Molasses Sales Agreement in full, but was only able to receive
a partial delivery of the molasses because of a disagreement as to
the quality of the products being delivered.
On 17 August 2005, more than six years after NOPA filed its Answer,
NOPA filed a Motion to Dismiss on the ground of an alleged failure
NOPA, Campos deliberately concealed in his Complaint the exact
amount of actual damages by opting to estimate the value of the
25
unwithdrawn molasses in order to escape the payment of the
proper docket fees.
On 30 June 2006, the RTC issued an Order denying the Motion to
Dismiss. NOPA received this Order on 17 July 2006.
On 1 August 2006, NOPA filed a Motion for Reconsideration of
the 30 June 2006 Order. On 5 January 2007, the RTC issued an Order
denying NOPAs Motion for Reconsideration.
On 2 April 2007, NOPA filed a Petition for Certiorari before the Court
of Appeals assailing the Orders of the RTC dated 30 June 2006 and 5
January 2007.
On 23 May 2007, the Court of Appeals issued the first assailed
Resolution dismissing the Petition for Certiorari on the following
grounds:
1. Failure of the Petitioner to state in its Verification that the
allegations in the petition are based on authentic records, in
violation of Section 4, Rule 7, of the 1997 Rules of Civil Procedure, as
amended by A.M. No. 00-2-10-SC (May 1, 2000), which provides:
x x x - A pleading is verified by an affidavit that the affiant has read
the pleading and that the allegations therein are true and correct of
his personal knowledge or based on authentic records.
A pleading required to be verified which contains a verification based
on information and belief, or lacks a proper verification, shall be
treated as an unsigned pleading.
2. Failure of the petitioner to append to the petition relevant
pleadings and documents, which would aid in the resolution of the
instant petition, in violation of Section 1, Rule 65 of the Rules of
Court, such as:
a. Ex-parte Motion to Set the Case for Pre-Trial dated July 27,
1999;
b. Notice of Pre-Trial;
c. Motion for Leave to File Third Party Complaint;
d. Orders dated July 31, 2000, March 20 2001, November 17,
2004, and May 17, 2005, respectively;
e. Motion to Suspend the Proceedings dated August 10, 2003;
f. Motion to Dismiss for Failure to Prosecute; and
g. Motion for Reconsideration to the Order dated May 12, 2005.
Section 1, Rule 65 of the Rules of Court, provides:
When any tribunal, board or officer exercising judicial or quasi-
judicial functions has acted without or in excess of its or his
jurisdiction, or with grave abuse of discretion amounting to lack or
excess of jurisdiction, and there is no appeal, or any plain, speedy,
and adequate remedy in the ordinary course of law, a person
aggrieved thereby may file a verified petition in the proper court,
alleging the facts with certainty and praying that judgment be
rendered annulling or modifying the proceedings of such tribunal,
board or officer, and granting such incidental reliefs as law and
justice may require.
The petition shall be accompanied by a certified true copy of the
judgment, order or resolution subject thereof, copies of all pleadings
and documents relevant and pertinent thereto, and a sworn
certification of non-forum shopping as provided in the paragraph of
section 3, Rule 46.
3. Failure of petitioners counsel to indicate in the petition his current
IBP Official Receipt Number, in violation of Bar Matter No. 1132
and/or A.M. No. 287, which reads as follows:
The Court resolved, upon recommendation of the Office of the Bar
Confidant, to GRANT the request of the Board of Governors of the
Integrated Bar of the Philippinesand the Sanguniang Panlalawigan of
Ilocos Norte to require all lawyers to indicate their Roll of Attorneys
Number in all papers or pleadings submitted to the various judicial
or quasi-judicial bodies in addition to the requirement of indicating
the current Professional Tax Receipt (PTR) and the IBP Official
[2]
Receipt or Lifetime Member Number.
On 22 June 2007, NOPA filed a Motion for Reconsideration of the
above Resolution, attaching thereto an Amended Petition
for Certiorari in compliance with the requirements of the Court of
Appeals deemed to have been violated by NOPA. The Court of
Appeals denied the said Motion in the second assailed Resolution
dated 16 August 2007.
Hence, this Petition for Review on Certiorari, where NOPA raises the
following issue and arguments:
ISSUE
WHETHER OR NOT THE PUBLIC RESPONDENT CA COMMITTED
REVERSIBLE ERROR WHEN IT RULED THAT THERE WAS NO
SUBSTANTIAL COMPLIANCE WITH THE PROCEDURAL
REQUIREMENTS WHEN PETITIONER FAILED TO ALLEGE IN ITS
VERIFICATION THAT THE ALLEGATIONS THEREIN ARE TRUE AND
CORRECT OF HIS PERSONAL KNOWLEDGE OR BASED ON AUTHENTIC
RECORDS AND FAILURE TO ATTACH THE NECESSARY DOCUMENTS
ON ITS PLEADINGS AS REQUIRED BY SECTION 1, RULE 65 OF THE
[3]
1997 RULES OF CIVIL PROCEDURE.
ARGUMENTS
1. The requirement that a pleading be verified is merely formal and
not jurisdictional. The court may give due course to an unverified
pleading where the material facts alleged are a matter of record and
the questions raised are mainly of law such as in a petition for
[4]
certiorari.
2. Petitioner had attached to its Petition for Certiorari clearly legible
and duplicate original or a certified true copy of the judgment or
final order or resolution of the court a quo and the requisite number
of plain copies thereof and such material portions of the record as
would support the petition.
[5]
3. Substantial compliance of the rules, which was further supplied by
the petitioners subsequent full compliance demonstrates its good
[6]
faith to abide by the procedural requirements.
4. The resolution of the important jurisdictional issue raised by the
petitioner before the PUBLIC RESPONDENT CA would justify a
[7]
relaxation of the rules.
The original Verification in the original Petition for Certiorari filed by
NOPA states as follows:
1. That I am the President and Chairman of the Board of Directors
of Negros Oriental Planters Association, Inc. (NOPA), the petitioner
in this case, a domestic corporation duly organized under Philippine
Laws, with principal place of business at Central Bais, Bais City,
Philippines; that I am duly authorized by the Board of NOPA
(Secretarys Certificate attached as Annex A) to cause the
preparation of the foregoing petition; and that I hereby affirm and
confirm that all the allegations contained herein are true and correct
to my own knowledge and belief;
[8]
26
NOPA claims that this Court has in several cases allowed pleadings
with a Verification that contains the allegation to the best of my
knowledge and the allegation are true and correct, without the
[9]
words of his own knowledge, citing Decano v. Edu, and Quimpo v.
[10]
De la Victoria. NOPA claims that the allegations in these cases
constitute substantial compliance with the Rules of Court, and
should likewise apply to the case at bar.
NOPA is mistaken. NOPA cited cases promulgated before 1 May
2000, when Section 4 of Rule 7 was amended by A.M. No. 00-2-
10. Before the amendment, said Section 4 stated:
SEC. 4. Verification.Except when otherwise specifically required by
law or rule, pleadings need not be under oath, verified or
accompanied by affidavit.
A pleading is verified by an affidavit that the affiant has read the
pleading and that the allegations therein are true and correct of his
knowledge and belief.
As amended, said Section 4 now states:
SEC. 4. Verification.Except when otherwise specifically required by
law or rule, pleadings need not be under oath, verified or
accompanied by affidavit.
A pleading is verified by an affidavit that the affiant has read the
pleading and that the allegations therein are true and correct of his
personal knowledge or based on authentic records.
Clearly, the amendment was introduced in order to make the
verification requirement stricter, such that the party cannot now
merely state under oath that he believes the statements made in the
pleading. He cannot even merely state under oath that he has
knowledge that such statements are true and correct. His knowledge
must be specifically alleged under oath to be either personal
knowledge or at least based on authentic records.
Unlike, however, the requirement for a Certification against Forum
Shopping in Section 5, wherein failure to comply with the
requirements is not curable by amendment of the complaint or
[11]
other initiatory pleading, Section 4 of Rule 7, as amended, states
that the effect of the failure to properly verify a pleading is that the
pleading shall be treated as unsigned:
A pleading required to be verified which contains a
verification based on information and belief, or upon knowledge,
information and belief, or lacks a proper verification, shall be
treated as an unsigned pleading.
Unsigned pleadings are discussed in the immediately preceding
section of Rule 7:
SEC. 3. Signature and address. x x x.
xxxx
An unsigned pleading produces no legal effect. However, the
court may, in its discretion, allow such deficiency to be remedied if
it shall appear that the same was due to mere inadvertence and not
intended for delay. Counsel who deliberately files an unsigned
pleading, or signs a pleading in violation of this Rule, or alleges
scandalous or indecent matter therein, or fails to promptly report to
the court a change of his address, shall be subject to appropriate
disciplinary action. (5a)
A pleading, therefore, wherein the Verification is merely based on
the partys knowledge and belief produces no legal effect, subject to
the discretion of the court to allow the deficiency to
be remedied. In the case at bar, the Court of Appeals, in the exercise
of this discretion, refused to allow the deficiency in the Verification
to be remedied, by denying NOPAs Motion for Reconsideration with
attached Amended Petition for Certiorari.
May an appellate court reverse the exercise of discretion by a lower
[12]
court? The old case of Lino Luna v. Arcenas states that it can, but
only in exceptional cases when there is grave abuse of this discretion
or adverse effect on the substantial rights of a litigant:
Discretionary power is generally exercised by trial judges in
furtherance of the convenience of the courts and the litigants, the
expedition of business, and in the decision of interlocutory matters
on conflicting facts where one tribunal could not easily prescribe to
another the appropriate rule of procedure.
The general rule, therefore, and indeed one of the fundamental
principles of appellate procedure is that decisions of a trial court
which "lie in discretion" will not be reviewed on appeal, whether
the case be civil or criminal at law or in equity.
We have seen that where such rulings have to do with minor
matters, not affecting the substantial rights of the parties, the
prohibition of review in appellate proceedings is made absolute by
the express terms of the statute; but it would be a monstrous
travesty on justice to declare that where the exercise of
discretionary power by an inferior court affects adversely the
substantial legal rights of a litigant, it is not subject to review on
appeal in any case wherein a clear and affirmative showing is made
of an abuse of discretion, or of a total lack of its exercise, or of
conduct amounting to an abuse of discretion, such as its improper
exercise under a misapprehension of the law applicable to the facts
upon which the ruling is based.
In its very nature, the discretionary control conferred upon the trial
judge over the proceedings had before him implies the absence of
any hard-and-fast rule by which it is to be exercised, and in
accordance with which it may be reviewed. But the discretion
conferred upon the courts is not a willful, arbitrary, capricious and
uncontrolled discretion. It is a sound, judicial discretion which
should always be exercised with due regard to the rights of the
parties and the demands of equity and justice. As was said in the
case of The Styria vs. Morgan (186 U. S., 1, 9): "The establishment of
a clearly defined rule of action would be the end of discretion, and
yet discretion should not be a word for arbitrary will or
inconsiderate action." So in the case of Goodwin vs. Prime (92 Me.,
355), it was said that "discretion implies that in the absence of
positive law or fixed rule the judge is to decide by his view of
expediency or by the demands of equity and justice."
There being no "positive law or fixed rule" to guide the judge in the
court below in such cases, there is no "positive law or fixed rule" to
guide a court of appeal in reviewing his action in the premises, and
such courts will not therefore attempt to control the exercise of
discretion by the court below unless it plainly appears that there
was "inconsiderate action" or the exercise of mere "arbitrary will,"
or in other words that his action in the premises amounted to "an
abuse of discretion." But the right of an appellate court to review
judicial acts which lie in the discretion of inferior courts may
properly be invoked upon a showing of a strong and clear case of
abuse of power to the prejudice of the appellant, or that the ruling
objected to rested on an erroneous principle of law not vested in
[13]
discretion.
The case at bar demonstrates a situation in which there is no effect
on the substantial rights of a litigant. NOPAs Petition for Certiorari is
seeking the reversal of the Orders of the RTC denying NOPAs Motion
to Dismiss on the ground of failure to pay the proper docket
fees. The alleged deficiency in the payment of docket fees
by Campos, if there is any, would not inure to the benefit of NOPA.
27
There is therefore no substantive right that will be prejudiced by the
Court of Appeals exercise of discretion in the case at bar. While the
payment of docket fees is jurisdictional, it is nevertheless
unmistakably also a technicality. Ironically, in seeking the leniency of
this Court on the basis of substantial justice, NOPA is ultimately
praying for a Writ of Certiorari enjoining the action for breach of
contract from being decided on the merits. Whats sauce for the
goose is sauce for the gander. A party cannot expect its opponent to
comply with the technical rules of procedure while, at the same
time, hoping for the relaxation of the technicalities in its favor.
There was therefore no grave abuse of discretion on the part of the
Court of Appeals warranting this Courts reversal of the exercise of
discretion by the former. However, even if we decide to brush aside
the lapses in technicalities on the part of NOPA in its Petition
for Certiorari, we nevertheless find that such Petition would still fail.
NOPA seeks in its Petition for Certiorari for the application of this
Courts ruling in Manchester Development Corporation v. Court of
[14]
Appeals, wherein we ruled that the court acquires jurisdiction
over any case only upon payment of the prescribed docket fee. An
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.
[15]
In denying NOPAs Motion to Dismiss, the RTC cited Sun Insurance
[16]
Office, Ltd. (SIOL) v. Asuncion, wherein we modified our ruling
in Manchester and decreed that where the initiatory pleading is not
accompanied by the payment of the docket fee, the court may allow
payment of the fee within a reasonable period of time, but in no
case beyond the applicable prescriptive or reglementary period. The
aforesaid ruling was made on the justification that, unlike
in Manchester, the private respondent in Sun Insurance Office, Ltd.
(SIOL) demonstrated his willingness to abide by the rules by paying
the additional docket fees required. NOPA claims that Sun is not
applicable to the case at bar, since Campos deliberately concealed
his claim for damages in the prayer.
[17]
In United Overseas Bank (formerly Westmont Bank) v. Ros, we
discussed how Manchester was not applicable to said case in view of
the lack of deliberate intent to defraud manifested in the latter:
This Court wonders how the petitioner could possibly arrive at the
conclusion that the private respondent was moved by fraudulent
intent in omitting the amount of damages claimed in its Second
Amended Complaint, thus placing itself on the same footing as the
complainant in Manchester, when it is clear that the factual milieu of
the instant case is far from that of Manchester.
First, the complainant in Manchester paid the docket fee only in
the amount of P410.00, notwithstanding its claim for damages in
the amount of P78,750,000.00, while in the present case, the
private respondent paid P42,000.00 as docket fees upon filing of
the original complaint.
Second, complainant's counsel in Manchester claimed, in the body of
the complaint, damages in the amount of P78,750.00 but omitted
the same in its prayer in order to evade the payment of docket fees.
Such fraud-defining circumstance is absent in the instant petition.
Finally, when the court took cognizance of the issue of non-
payment of docket fees in Manchester, the complainant therein
filed an amended complaint, this time omitting all mention of the
amount of damages being claimed in the body of the complaint;
and when directed by the court to specify the amount of damages
in such amended complaint, it reduced the same
from P78,750,000.00 to P10,000,000.00, obviously to avoid
payment of the required docket fee. Again, this patent fraudulent
scheme is wanting in the case at bar.
This Court is not inclined to adopt the petitioner's piecemeal
construction of our rulings in Manchester and Sun Insurance. Its
attempt to strip the said landmark cases of one or two lines and use
them to bolster its arguments and clothe its position with
jurisprudential blessing must be struck down by this Court.
All told, the rule is clear and simple. In case where the party does
not deliberately intend to defraud the court in payment of docket
fees, and manifests its willingness to abide by the rules by paying
additional docket fees when required by the court, the liberal
doctrine enunciated in Sun Insurance and not the strict regulations
set in Manchester will apply.
In the case at bar, Campos filed an amount of P54,898.50 as docket
fee, based on the amounts of P10,000,000.00 representing the value
of unwithdrawn molasses, P100,00.00 as storage fee, P200,00.00 as
moral damages, P100,000.00 as exemplary damages
and P500,000.00 as attorneys fees. The total amount considered in
computing the docket fee was P10,900,000.00. NOPA alleges
that Campos deliberately omitted a claim for unrealized profit
of P100,000.00 and an excess amount of storage fee in the amount
of P502,875.98 in its prayer and, hence, the amount that should
have been considered in the payment of docket fees
is P11,502,875.98. The amount allegedly deliberately omitted was
therefore only P602,875.98 out of P11,502,875.98, or merely 5.2%
of said alleged total. Camposs pleadings furthermore evince his
willingness to abide by the rules by paying the additional docket fees
when required by the Court.
Since the circumstances of this case clearly show that there was no
deliberate intent to defraud the Court in the payment of docket
fees, the case of Sun should be applied, and the Motion to Dismiss
by NOPA should be denied.
WHEREFORE, the Resolutions of the Court of Appeals dated 23 May
2007 and 16 August 2007, respectively, in CA-G.R. SP No. 02651,
outrightly dismissing the Petition for Certiorari filed by petitioner
Negros Oriental Planters Association, Inc. against private respondent
Aniceto Manojo Campos, are AFFIRMED. No costs.
SO ORDERED.
[1]
12. HEIRS OF BERTULDO HINOG: Bertuldo Hinog II, Bertuldo
Hinog III, Bertuldo Hinog, Jr., Jocelyn Hinog, Bertoldo Hinog IV,
Bertoldo Hinog V, Edgardo Hinog, Milagros H. Pabatao, Lilian H.
King, Victoria H. Engracia, Terisita C. Hinog, Paz H. Besana, Roberto
C. Hinog, Vicente C. Hinog, Roel C. Hinog, Marilyn C. Hinog, Bebot
C. Hinog, lordes C. Hinog, Pablo Chiong, Arlene Lanasang (All
respresented by Bertuldo Hinog III), petitioners, vs. HON. ACHILLES
MELICOR, in his capacity as Presiding Judge, RTC, Branch 4,
th
7 Judicial Region, Tagbiliran City, Bohol, and CUSTODIO BALANE,
RUFO BALANE, HONORIO BALANE, and TOMAS
BALANE, respondents.
DECISION
AUSTRIA-MARTINEZ, J.:
Before us is a petition for certiorari and prohibition under Rule 65 of
the Rules of Court which assails the Orders dated March 22, 1999,
August 13, 1999 and October 15, 1999 of the Regional Trial Court,
Branch 4, of Tagbilaran City, Bohol in Civil Case No. 4923.
The factual background of the case is as follows:
On May 21, 1991, private respondents Custodio, Rufo, Tomas and
Honorio, all surnamed Balane, filed a complaint for Recovery of
Ownership and Possession, Removal of Construction and Damages
against Bertuldo Hinog (Bertuldo for brevity). They alleged that: they
own a 1,399- square meter parcel of land situated in Malayo Norte,
28
Cortes, Bohol, designated as Lot No. 1714; sometime in March 1980,
they allowed Bertuldo to use a portion of the said property for a
period of ten years and construct thereon a small house of light
materials at a nominal annual rental of P100.00 only, considering
the close relations of the parties; after the expiration of the ten-year
period, they demanded the return of the occupied portion and
removal of the house constructed thereon but Bertuldo refused and
instead claimed ownership of the entire property.
Accordingly, private respondents sought to oust Bertuldo from the
premises of the subject property and restore upon themselves the
ownership and possession thereof, as well as the payment of moral
and exemplary damages, attorneys fees and litigation expenses in
amounts justified by the evidence.
[2]
On July 2, 1991, Bertuldo filed his Answer. He alleged ownership of
the disputed property by virtue of a Deed of Absolute Sale dated July
2, 1980, executed by one Tomas Pahac with the knowledge and
[3]
conformity of private respondents.
After the pre-trial, trial on the merits ensued. On November 18,
1997, private respondents rested their case. Thereupon, Bertuldo
started his direct examination. However, on June 24, 1998, Bertuldo
died without completing his evidence.
On August 4, 1998, Atty. Sulpicio A. Tinampay withdrew as counsel
for Bertuldo as his services were terminated by petitioner Bertuldo
Hinog III. Atty. Veronico G. Petalcorin then entered his appearance
[4]
as new counsel for Bertuldo.
On September 22, 1998, Atty. Petalcorin filed a motion to expunge
the complaint from the record and nullify all court proceedings on
the ground that private respondents failed to specify in the
complaint the amount of damages claimed so as to pay the correct
docket fees; and that under Manchester Development Corporation
[5]
vs. Court of Appeals, non-payment of the correct docket fee is
[6]
jurisdictional.
In an amended motion, filed on October 2, 1998, Atty. Petalcorin
further alleged that the private respondents failed to pay the correct
docket fee since the main subject matter of the case cannot be
estimated as it is for recovery of ownership, possession and removal
[7]
of construction.
Private respondents opposed the motion to expunge on the
following grounds: (a) said motion was filed more than seven years
from the institution of the case; (b) Atty. Petalcorin has not complied
with Section 16, Rule 3 of the Rules of Court which provides that the
death of the original defendant requires a substitution of parties
before a lawyer can have legal personality to represent a litigant and
the motion to expunge does not mention of any specific party whom
he is representing; (c) collectible fees due the court can be charged
as lien on the judgment; and (d) considering the lapse of time, the
[8]
motion is merely a dilatory scheme employed by petitioners.
In their Rejoinder, petitioners manifested that the lapse of time does
not vest the court with jurisdiction over the case due to failure to
pay the correct docket fees. As to the contention that deficiency in
payment of docket fees can be made as a lien on the judgment,
petitioners argued that the payment of filing fees cannot be made
[9]
dependent on the result of the action taken.
On January 21, 1999, the trial court, while ordering the complaint to
be expunged from the records and the nullification of all court
proceedings taken for failure to pay the correct docket fees,
nonetheless, held:
The Court can acquire jurisdiction over this case only upon the
payment of the exact prescribed docket/filing fees for the main
cause of action, plus additional docket fee for the amount of
damages being prayed for in the complaint, which amount should be
specified so that the same can be considered in assessing the
amount of the filing fees. Upon the complete payment of such fees,
the Court may take appropriate action in the light of the ruling in the
case of Manchester Development Corporation vs. Court of
[10]
Appeals, supra.
Accordingly, on January 28, 1999, upon payment of deficiency
docket fee, private respondents filed a manifestation with prayer to
[11] [12]
reinstate the case. Petitioners opposed the reinstatement but
on March 22, 1999, the trial court issued the first assailed Order
[13]
reinstating the case.
[14]
On May 24, 1999, petitioners, upon prior leave of court, filed their
supplemental pleading, appending therein a Deed of Sale dated
[15]
November 15, 1982. Following the submission of private
[16]
respondents opposition thereto, the trial court, in its Order dated
July 7, 1999, denied the supplemental pleading on the ground that
the Deed of Absolute Sale is a new matter which was never
mentioned in the original answer dated July 2, 1991, prepared by
Bertuldos original counsel and which Bertuldo verified; and that
such new document is deemed waived in the light of Section 1, Rule
[17]
9 of the Rules of Court. The trial court also noted that no formal
substitution of the parties was made because of the failure of
defendants counsel to give the names and addresses of the legal
representatives of Bertuldo, so much so that the supposed heirs of
[18]
Bertuldo are not specified in any pleading in the case.
On July 14, 1999, petitioners manifested that the trial court having
expunged the complaint and nullified all court proceedings, there is
no valid case and the complaint should not be admitted for failure to
pay the correct docket fees; that there should be no case to be
[19]
reinstated and no case to proceed as there is no complaint filed.
After the submission of private respondents opposition and
[20]
[21]
petitioners rejoinder, the trial court issued the second assailed
Order on August 13, 1999, essentially denying petitioners
manifestation/rejoinder. The trial court held that the issues raised in
such manifestation/rejoinder are practically the same as those
raised in the amended motion to expunge which had already been
passed upon in the Order dated January 21, 1999. Moreover, the
trial court observed that the Order dated March 22, 1999 which
reinstated the case was not objected to by petitioners within the
reglementary period or even thereafter via a motion for
[22]
reconsideration despite receipt thereof on March 26, 1999.
On August 25, 1999, petitioners filed a motion for
[23]
reconsideration but the same was denied by the trial court in its
third assailed Order dated October 15, 1999. The trial court held
that the Manchester rule was relaxed in Sun Insurance Office, Ltd. vs.
[24]
Asuncion. Noting that there has been no substitution of parties
following the death of Bertuldo, the trial court directed Atty.
Petalcorin to comply with the provisions of Section 16, Rule 3 of the
Rules of Court. The trial court also reiterated that the Order dated
March 22, 1999 reinstating the case was not assailed by petitioners
within the reglementary period, despite receipt thereof on March
[25]
26, 1999.
On November 19, 1999, Atty. Petalcorin complied with the directive
of the trial court to submit the names and addresses of the heirs of
[26]
Bertuldo.
On November 24, 1999, petitioners filed before us the present
[27]
petition for certiorari and prohibition. They allege that the public
respondent committed grave abuse of discretion in allowing the
case to be reinstated after private respondents paid the docket fee
deficiency since the trial court had earlier expunged the complaint
from the record and nullified all proceedings of the case and such
ruling was not contested by the private respondents. Moreover,
29
they argue that the public respondent committed grave abuse of
discretion in allowing the case to be filed and denying the
manifestation with motion to dismiss, despite the defect in the
complaint which prayed for damages without specifying the
amounts, in violation of SC Circular No. 7, dated March 24, 1988.
In their Comment, private respondents aver that no grave abuse of
discretion was committed by the trial court in reinstating the
complaint upon the payment of deficiency docket fees because
petitioners did not object thereto within the reglementary period.
Besides, Atty. Petalcorin possessed no legal personality to appear as
counsel for the heirs of Bertuldo until he complies with Section 16,
Rule 3 of the Rules of Court.
[28]
At the outset, we note the procedural error committed by
petitioners in directly filing the instant petition before this Court for
it violates the established policy of strict observance of the judicial
hierarchy of courts.
Although the Supreme Court, Court of Appeals and the Regional Trial
Courts have concurrent jurisdiction to issue writs of certiorari,
prohibition, mandamus, quo warranto, habeas corpus and
injunction, such concurrence does not give the petitioner
[29]
unrestricted freedom of choice of court forum. As we stated
[30]
in People vs. Cuaresma:
This Court's original jurisdiction to issue writs of certiorari is not
exclusive. It is shared by this Court with Regional Trial Courts and
with the Court of Appeals. This concurrence of jurisdiction is not,
however, to be taken as according to parties seeking any of the writs
an absolute, unrestrained freedom of choice of the court to which
application therefor will be directed. There is after all a hierarchy of
courts. That hierarchy is determinative of the venue of appeals, and
also serves as a general determinant of the appropriate forum for
petitions for the extraordinary writs. A becoming regard for that
judicial hierarchy most certainly indicates that petitions for the
issuance of extraordinary writs against first level (inferior) courts
should be filed with the Regional Trial Court, and those against the
latter, with the Court of Appeals. A direct invocation of the Supreme
Courts original jurisdiction to issue these writs should be allowed
only when there are special and important reasons therefor, clearly
and specifically set out in the petition. This is [an] established policy.
It is a policy necessary to prevent inordinate demands upon the
Courts time and attention which are better devoted to those
matters within its exclusive jurisdiction, and to prevent further over-
[31]
crowding of the Courts docket.
The rationale for this rule is two-fold: (a) it would be an imposition
upon the precious time of this Court; and (b) it would cause an
inevitable and resultant delay, intended or otherwise, in the
adjudication of cases, which in some instances had to be remanded
or referred to the lower court as the proper forum under the rules of
procedure, or as better equipped to resolve the issues because this
[32]
Court is not a trier of facts.
Thus, this Court will not entertain direct resort to it unless the
redress desired cannot be obtained in the appropriate courts, and
exceptional and compelling circumstances, such as cases of national
interest and of serious implications, justify the availment of the
extraordinary remedy of writ of certiorari, calling for the exercise of
its primary jurisdiction. Exceptional and compelling circumstances
were held present in the following cases: (a) Chavez vs.
[33]
Romulo on citizens right to bear arms; (b) Government of the
[34]
United States of America vs. Purganan on bail in extradition
[35]
proceedings; (c) Commission on Elections vs. Quijano-Padilla on
government contract involving modernization and computerization
of voters registration list; (d) Buklod ng Kawaning EIIB vs.
[36]
Zamora on status and existence of a public office; and (e) Fortich
[37]
vs. Corona on the so-called Win-Win Resolution of the Office of
the President which modified the approval of the conversion to
agro-industrial area.
In this case, no special and important reason or exceptional and
compelling circumstance analogous to any of the above cases has
been adduced by the petitioners so as to justify direct recourse to
this Court. The present petition should have been initially filed in the
Court of Appeals in strict observance of the doctrine on the
hierarchy of courts. Failure to do so is sufficient cause for the
dismissal of the petition at bar.
In any event, even if the Court disregards such procedural flaw, the
petitioners contentions on the substantive aspect of the case fail to
invite judgment in their favor.
The unavailability of the writ of certiorari and prohibition in this case
is borne out of the fact that petitioners principally assail the Order
dated March 22, 1999 which they never sought reconsideration of,
in due time, despite receipt thereof on March 26, 1999. Instead,
petitioners went through the motion of filing a supplemental
pleading and only when the latter was denied, or after more than
three months have passed, did they raise the issue that the
complaint should not have been reinstated in the first place because
the trial court had no jurisdiction to do so, having already ruled that
the complaint shall be expunged.
After recognizing the jurisdiction of the trial court by seeking
affirmative relief in their motion to serve supplemental pleading
upon private respondents, petitioners are effectively barred by
[38]
estoppel from challenging the trial courts jurisdiction. If a party
invokes the jurisdiction of a court, he cannot thereafter challenge
[39]
the courts jurisdiction in the same case. To rule otherwise would
amount to speculating on the fortune of litigation, which is against
[40]
the policy of the Court.
Nevertheless, there is a need to correct the erroneous impression of
the trial court as well as the private respondents that petitioners are
barred from assailing the Order dated March 22, 1999 which
reinstated the case because it was not objected to within the
reglementary period or even thereafter via a motion for
reconsideration despite receipt thereof on March 26, 1999.
It must be clarified that the said order is but a resolution on an
incidental matter which does not touch on the merits of the case or
[41]
put an end to the proceedings. It is an interlocutory order since
there leaves something else to be done by the trial court with
[42]
respect to the merits of the case. As such, it is not subject to a
reglementary period. Reglementary period refers to the period set
by the rules for appeal or further review of a final judgment or
order, i.e., one that ends the litigation in the trial court.
Moreover, the remedy against an interlocutory order is generally
not to resort forthwith to certiorari, but to continue with the case in
due course and, when an unfavorable verdict is handed down, to
[43]
take an appeal in the manner authorized by law. Only when the
court issued such order without or in excess of jurisdiction or with
grave abuse of discretion and when the assailed interlocutory order
is patently erroneous and the remedy of appeal would not afford
adequate and expeditious relief will certiorari be considered an
[44]
appropriate remedy to assail an interlocutory order. Such special
circumstances are absolutely wanting in the present case.
Time and again, the Court has held that the Manchester rule has
been modified in Sun Insurance Office, Ltd. (SIOL) vs.
[45]
Asuncion which defined the following guidelines involving the
payment of docket fees:
1. 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
30
action. Where the filing of the initiatory pleading is not accompanied
by payment of the docket fee, the court may allow payment of the
fees within a reasonable time but in no case beyond the applicable
prescriptive or reglementary period.
2. The same rule applies to permissive counterclaims, third-party
claims and similar pleadings, which shall not be considered filed until
and unless the filing fee prescribed therefor is paid. The court may
also allow payment of said fee within a reasonable time but also in
no case beyond its applicable prescriptive or reglementary period.
3. Where the trial court acquires jurisdiction over a claim by the
filing of the appropriate pleading and payment of the prescribed
filing fee but, subsequently, the judgment awards a claim not
specified in the pleading, or if specified the same has been left for
determination by the court, the additional filing fee therefor shall
constitute a lien on the judgment. It shall be the responsibility of the
Clerk of Court or his duly authorized deputy to enforce said lien and
assess and collect the additional fee.
Plainly, while the payment of the prescribed docket fee is a
jurisdictional requirement, even its non-payment at the time of filing
does not automatically cause the dismissal of the case, as long as the
fee is paid within the applicable prescriptive or reglementary period,
more so when the party involved demonstrates a willingness to
[46]
abide by the rules prescribing such payment. Thus, when
insufficient filing fees were initially paid by the plaintiffs and there
was no intention to defraud the government, the Manchester
[47]
rule does not apply.
Under the peculiar circumstances of this case, the reinstatement of
the complaint was just and proper considering that the cause of
action of private respondents, being a real action, prescribes in
[48]
thirty years, and private respondents did not really intend to
evade the payment of the prescribed docket fee but simply contend
that they could not be faulted for inadequate assessment because
the clerk of court made no notice of demand or
[49]
reassessment. They were in good faith and simply relied on the
assessment of the clerk of court.
Furthermore, the fact that private respondents prayed for payment
of damages in amounts justified by the evidence does not call for the
dismissal of the complaint for violation of SC Circular No. 7, dated
March 24, 1988 which required that all complaints must specify the
amount of damages sought not only in the body of the pleadings but
also in the prayer in order to be accepted and admitted for
filing. Sun Insurance effectively modified SC Circular No. 7 by
providing that filing fees for damages and awards that cannot be
estimated constitute liens on the awards finally granted by the trial
[50]
court.
Thus, while the docket fees were based only on the real property
valuation, the trial court acquired jurisdiction over the action, and
judgment awards which were left for determination by the court or
as may be proven during trial would still be subject to additional
filing fees which shall constitute a lien on the judgment. It would
then be the responsibility of the Clerk of Court of the trial court or
his duly authorized deputy to enforce said lien and assess and collect
[51]
the additional fees.
It is worth noting that when Bertuldo filed his Answer on July 2,
1991, he did not raise the issue of lack of jurisdiction for non-
payment of correct docket fees. Instead, he based his defense on a
claim of ownership and participated in the proceedings before the
trial court. It was only in September 22, 1998 or more than seven
years after filing the answer, and under the auspices of a new
counsel, that the issue of jurisdiction was raised for the first time in
the motion to expunge by Bertuldos heirs.
After Bertuldo vigorously participated in all stages of the case before
the trial court and even invoked the trial courts authority in order to
ask for affirmative relief, petitioners, considering that they merely
stepped into the shoes of their predecessor, are effectively barred
by estoppel from challenging the trial courts jurisdiction. Although
the issue of jurisdiction may be raised at any stage of the
proceedings as the same is conferred by law, it is nonetheless
settled that a party may be barred from raising it on ground of
laches or estoppel.
[52]
Moreover, no formal substitution of the parties was effected within
thirty days from date of death of Bertuldo, as required by Section
[53]
16, Rule 3 of the Rules of Court. Needless to stress, the purpose
behind the rule on substitution is the protection of the right of every
party to due process. It is to ensure that the deceased party would
continue to be properly represented in the suit through the duly
[54]
appointed legal representative of his estate. Non-compliance with
the rule on substitution would render the proceedings and judgment
of the trial court infirm because the court acquires no jurisdiction
over the persons of the legal representatives or of the heirs on
[55]
whom the trial and the judgment would be binding. Thus, proper
substitution of heirs must be effected for the trial court to acquire
jurisdiction over their persons and to obviate any future claim by
any heir that he was not apprised of the litigation against Bertuldo
or that he did not authorize Atty. Petalcorin to represent him.
The list of names and addresses of the heirs was submitted sixteen
months after the death of Bertuldo and only when the trial court
directed Atty. Petalcorin to comply with the provisions of Section 16,
Rule 3 of the Rules of Court. Strictly speaking therefore, before said
compliance, Atty. Petalcorin had no standing in the court a
quo when he filed his pleadings. Be that as it may, the matter has
been duly corrected by the Order of the trial court dated October
15, 1999.
[56]
To be sure, certiorari under Rule 65 is a remedy narrow in scope
and inflexible in character. It is not a general utility tool in the legal
[57]
workshop. It offers only a limited form of review. Its principal
[58]
function is to keep an inferior tribunal within its jurisdiction. It can
be invoked only for an error of jurisdiction, that is, one where the
act complained of was issued by the court, officer or a quasi-judicial
body without or in excess of jurisdiction, or with grave abuse of
discretion which is tantamount to lack or in excess of
[59] [60]
jurisdiction, not to be used for any other purpose, such as to
cure errors in proceedings or to correct erroneous conclusions of
[61]
law or fact. A contrary rule would lead to confusion, and seriously
hamper the administration of justice.
Petitioners utterly failed to show that the trial court gravely abused
its discretion in issuing the assailed resolutions. On the contrary, it
acted prudently, in accordance with law and jurisprudence.
WHEREFORE, the instant petition for certiorari is DISMISSED for lack
of merit.
No costs.
SO ORDERED.
13. JUANA COMPLEX I HOMEOWNERS ASSOCIATION, INC., ANDRES
C. BAUTISTA, BRIGIDO DIMACULANGAN, DOLORES P. PRADO,
IMELDA DE LA CRUZ, EDITHA C. DY, FLORENCIA M. MERCADO,
LEOVINO C. DATARIO, AIDAA. ABAYON, NAPOLEON M. DIMAANO,
ROSITA G. ESTIGOY and NELSON A. LOYOLA,
VS
FIL-ESTATE LAND, INC., FIL ESTATE ECOCENTRUM CORPORATION,
LA PAZ HOUSING AND DEVELOPMENT CORPORATION, WARBIRD
31
SECURITY AGENCY, ENRIQUE RIVILLA, MICHAEL E. JETHMAL and
MICHAEL ALUNAN,
Before the Court are two (2) consolidated petitions assailing the July
[1] [2]
31, 2001 Decision and February 21, 2002 Resolution of the Court
of Appeals (CA) in CA-G.R. SP No. 60543, which annulled and set
[3]
aside the March 3, 1999 Order of the Regional Trial Court, Branch
25, Bian, Laguna (RTC), granting the application for the issuance of a
writ of preliminary injunction, and upheld the June 16, 2000
[4]
Omnibus Order denying the motion to dismiss.
The Facts:
On January 20, 1999, Juana Complex I Homeowners Association,
Inc. (JCHA), together with individual residents of Juana Complex I
and other neighboring subdivisions (collectively referred as JCHA, et.
[5]
al.), instituted a complaint for damages, in its own behalf and as a
class suit representing the regular commuters and motorists of
Juana Complex I and neighboring subdivisions who were deprived of
the use of La Paz Road, against Fil-Estate Land, Inc. (Fil-Estate), Fil-
estate Ecocentrum Corporation (FEEC), La Paz Housing &
Development Corporation (La Paz), and Warbird Security Agency
and their respective officers (collectively referred as Fil-Estate, et
al.).
The complaint alleged that JCHA, et al. were regular commuters and
motorists who constantly travelled towards the direction of Manila
and Calamba; that they used the entry and exit toll gates of South
Luzon Expressway (SLEX) by passing through right-of-way public road
known as La Paz Road; that they had been using La Paz Road for
more than ten (10) years; that in August 1998, Fil-estate excavated,
broke and deliberately ruined La Paz Road that led to SLEX so JCHA,
et al. would not be able to pass through the said road; that La Paz
Road was restored by the residents to make it passable but Fil-
estate excavated the road again; that JCHA reported the matter to
the Municipal Government and the Office of the Municipal Engineer
but the latter failed to repair the road to make it passable and safe
to motorists and pedestrians; that the act of Fil-estate in excavating
La Paz Road caused damage, prejudice, inconvenience, annoyance,
and loss of precious hours to them, to the commuters and motorists
because traffic was re-routed to narrow streets that caused terrible
traffic congestion and hazard; and that its permanent closure would
not only prejudice their right to free and unhampered use of the
property but would also cause great damage and irreparable injury.
Accordingly, JCHA, et al. also prayed for the immediate issuance of a
Temporary Restraining Order (TRO) or a writ of preliminary
injunction (WPI) to enjoin Fil-Estate, et al. from stopping and
intimidating them in their use of La Paz Road.
On February 10, 1999, a TRO was issued ordering Fil-Estate, et al, for
a period of twenty (20) days, to stop preventing, coercing,
intimidating or harassing the commuters and motorists from using
[6]
the La Paz Road.
Subsequently, the RTC conducted several hearings to determine the
propriety of the issuance of a WPI.
On February 26, 1999, Fil-Estate, et al. filed a motion to
[7]
dismiss arguing that the complaint failed to state a cause of action
and that it was improperly filed as a class suit. On March 5, 1999,
[8]
JCHA, et al. filed their comment on the motion to dismiss to which
[9]
respondents filed a reply.
[10]
On March 3, 1999, the RTC issued an Order granting the WPI and
required JCHA, et al. to post a bond.
On March 19, 1999, Fil-Estate, et al. filed a motion for
[11]
reconsideration arguing, among others, that JCHA, et al. failed to
satisfy the requirements for the issuance of a WPI. On March 23,
[12]
1999, JCHA, et al. filed their opposition to the motion.
The RTC then issued its June 16, 2000 Omnibus Order, denying both
the motion to dismiss and the motion for reconsideration filed by
Fil-Estate, et al.
Not satisfied, Fil-Estate, et al. filed a petition for certiorari and
prohibition before the CA to annul (1) the Order dated March 3,
1999 and (2) the Omnibus Order dated June 16, 2000. They
contended that the complaint failed to state a cause of action and
that it was improperly filed as a class suit. With regard to the
issuance of the WPI, the defendants averred that JCHA, et al. failed
to show that they had a clear and unmistakable right to the use of La
Paz Road; and further claimed that La Paz Road was a torrens
registered private road and there was neither a voluntary nor legal
easement constituted over it.
[13]
On July 31, 2001, the CA rendered the decision partially granting the
petition, the dispositive portion of which reads:
WHEREFORE, the petition is hereby partially GRANTED. The Order
dated March 3, 1999 granting the writ of preliminary injunction is
hereby ANNULLED and SET ASIDE but the portion of the Omnibus
Order dated June 16, 2000 denying the motion to dismiss is upheld.
[14]
SO ORDERED.
The CA ruled that the complaint sufficiently stated a cause of action
when JCHA, et al. alleged in their complaint that they had been using
La Paz Road for more than ten (10) years and that their right was
violated when Fil-Estate closed and excavated the road. It sustained
the RTC ruling that the complaint was properly filed as a class suit as
it was shown that the case was of common interest and that the
individuals sought to be represented were so numerous that it was
impractical to include all of them as parties. The CA, however,
annulled the WPI for failure of JCHA, et al. to prove their clear and
present right over La Paz Road. The CA ordered the remand of the
case to the RTC for a full-blown trial on the merits.
Hence, these petitions for review.
In G.R. No. 152272, JCHA, et al. come to this Court, raising the
following issues:
(A) THE HONORABLE COURT OF APPEALS, IN HOLDING THAT A
FULL-BLOWN TRIAL ON THE MERITS IS REQUIRED TO DETERMINE
THE NATURE OF THE LA PAZ ROAD, HAD DEPARTED FROM THE
ACCEPTED AND USUAL COURSE OF JUDICIAL PROCEEDINGS AS TO
CALL FOR AN EXERCISE OF THE POWER OF SUPERVISION.
(B) THE HONORABLE COURT OF APPEALS, IN HOLDING THAT THE
PETITIONERS FAILED TO SATISFY THE REQUIREMENTS FOR THE
ISSUANCE OF A WRIT OF PRELIMINARY INJUNCTION, HAD DECIDED
NOT IN ACCORD WITH LAW AND WITH THE APPLICABLE DECISIONS
[15]
OF THE SUPREME COURT.
In G.R. No. 152397, on the other hand, Fil-Estate, et al. anchor their
petition on the following issues:
I. The Court of Appeals declaration that respondents Complaint
states a cause of action is contrary to existing law and
jurisprudence.
II. The Court of Appeals pronouncement that respondents
complaint was properly filed as a class suit is contrary to existing
law and jurisprudence.
III. The Court of Appeals conclusion that full blown trial on the
merits is required to determine the nature of the La Paz Road is
[16]
contrary to existing laws and jurisprudence.
32
JCHA, et al. concur with the CA that the complaint sufficiently stated
a cause of action. They, however, disagree with the CAs
pronouncement that a full-blown trial on the merits was necessary.
They claim that during the hearing on the application of the writ of
injunction, they had sufficiently proven that La Paz Road was a
public road and that commuters and motorists of their neighboring
villages had used this road as their means of access to the San
Agustin Church, Colegio De San Agustin and to SLEX in going to
Metro Manila and to Southern Tagalog particularly during the rush
hours when traffic at Carmona Entry/Exit and Susana Heights
Entry/Exit was at its worst.
JCHA, et al. argue that La Paz Road has attained the status and
character of a public road or burdened by an apparent easement of
public right of way. They point out that La Paz Road is the widest
road in the neighborhood used by motorists in going to Halang
Road and in entering the SLEX-Halang toll gate and that there is no
other road as wide as La Paz Road existing in the vicinity. For
residents of San Pedro, Laguna, the shortest, convenient and safe
route towards SLEX Halang is along Rosario Avenue joining La Paz
Road.
Finally, JCHA, et al. argue that the CA erred when it voided the WPI
because the public nature of La Paz Road had been sufficiently
proven and, as residents of San Pedro and Bian, Laguna, their right
to use La Paz Road is undeniable.
[17]
In their Memorandum, Fil-Estate, et al. explain that La Paz Road is
included in the parcels of land covered by Transfer Certificates of
Title (TCT) Nos. T-120008, T-90321 and T-90607, all registered in the
name of La Paz. The purpose of constructing La Paz Road was to
provide a passageway for La Paz to its intended projects to the
south, one of which was the Juana Complex I. When Juana Complex I
was completed, La Paz donated the open spaces, drainage, canal,
and lighting facilities inside the Juana Complex I to the Municipality
of Bian. The streets within the subdivisions were then converted to
public roads and were opened for use of the general public. The La
Paz Road, not being part of the Juana Complex I, was excluded from
the donation. Subsequently, La Paz became a shareholder of FEEC, a
consortium formed to develop several real properties in Bian,
Laguna, known as Ecocentrum Project. In exchange for shares of
stock, La Paz contributed some of its real properties to
the Municipality of Bian, including the properties constituting La Paz
Road, to form part of the Ecocentrum Project.
Fil-Estate, et al. agree with the CA that the annulment of the WPI
was proper since JCHA, et al. failed to prove that they have a clear
right over La Paz Road. Fil-Estate, et al. assert that JCHA, et al. failed
to prove the existence of a right of way or a right to pass over La Paz
Road and that the closure of the said road constituted an injury to
such right. According to them, La Paz Road is a torrens registered
private road and there is neither a voluntary nor legal easement
constituted over it. They claim that La Paz Road is a private property
registered under the name of La Paz and the beneficial ownership
thereof was transferred to FEEC when La Paz joined the consortium
for the Ecocentrum Project.
Fil-Estate, et al., however, insist that the complaint did not
sufficiently contain the ultimate facts to show a cause of action.
They aver the bare allegation that one is entitled to something is an
allegation of a conclusion which adds nothing to the pleading.
They likewise argue that the complaint was improperly filed as a
class suit for it failed to show that JCHA, et al. and the commuters
and motorists they are representing have a well-defined community
of interest over La Paz Road. They claim that the excavation of La
Paz Road would not necessarily give rise to a common right or cause
of action for JCHA, et al. against them since each of them has a
separate and distinct purpose and each may be affected differently
than the others.
The Courts Ruling
The issues for the Courts resolution are: (1) whether or not the
complaint states a cause of action; (2) whether the complaint has
been properly filed as a class suit; and (2) whether or not a WPI is
warranted.
Section 2, Rule 2 of the Rules of Court defines a cause of action as an
act or omission by which a party violates the right of another. A
complaint states a cause of action when it contains three (3)
essential elements of a cause of action, namely:
(1) the legal right of the plaintiff,
(2) the correlative obligation of the defendant, and
(3) the act or omission of the defendant in violation of said legal
[18]
right.
The question of whether the complaint states a cause of action is
determined by its averments regarding the acts committed by the
[19]
defendant. Thus, it must contain a concise statement of the
ultimate or essential facts constituting the plaintiffs cause of
[20]
action. To be taken into account are only the material allegations
in the complaint; extraneous facts and circumstances or other
[21]
matters aliunde are not considered.
The test of sufficiency of facts alleged in the complaint as
constituting a cause of action is whether or not admitting the facts
alleged, the court could render a valid verdict in accordance with the
[22]
prayer of said complaint. Stated differently, if the allegations in
the complaint furnish sufficient basis by which the complaint can be
maintained, the same should not be dismissed regardless of the
[23]
defense that may be asserted by the defendant.
In the present case, the Court finds the allegations in the complaint
sufficient to establish a cause of action. First, JCHA, et al.s averments
in the complaint show a demandable right over La Paz Road. These
are: (1) their right to use the road on the basis of their allegation
that they had been using the road for more than 10 years; and (2) an
easement of a right of way has been constituted over the said roads.
There is no other road as wide as La Paz Road existing in the vicinity
and it is the shortest, convenient and safe route towards SLEX
Halang that the commuters and motorists may use. Second, there is
an alleged violation of such right committed by Fil-Estate, et al.
when they excavated the road and prevented the commuters and
motorists from using the same. Third, JCHA, et al. consequently
suffered injury and that a valid judgment could have been rendered
in accordance with the relief sought therein.
With respect to the issue that the case was improperly instituted as
a class suit, the Court finds the opposition without merit.
Section 12, Rule 3 of the Rules of Court defines a class suit, as
follows:
Sec. 12. Class suit. When the subject matter of the controversy is
one of common or general interest to many persons so numerous
that it is impracticable to join all as parties, a number of them which
the court finds to be sufficiently numerous and representative as to
fully protect the interests of all concerned may sue or defend for the
benefit of all. Any party in interest shall have the right to intervene
to protect his individual interest.
The necessary elements for the maintenance of a class suit are: 1)
the subject matter of controversy is one of common or general
interest to many persons; 2) the parties affected are so numerous
33
that it is impracticable to bring them all to court; and 3) the parties
bringing the class suit are sufficiently numerous or representative of
[24]
the class and can fully protect the interests of all concerned.
In this case, the suit is clearly one that benefits all commuters and
motorists who use La Paz Road. As succinctly stated by the CA:
The subject matter of the instant case, i.e., the closure and
excavation of the La Paz Road, is initially shown to be of common or
general interest to many persons. The records reveal that numerous
individuals have filed manifestations with the lower court, conveying
their intention to join private respondents in the suit and claiming
that they are similarly situated with private respondents for they
were also prejudiced by the acts of petitioners in closing and
excavating the La Paz Road. Moreover, the individuals sought to be
represented by private respondents in the suit are so numerous that
it is impracticable to join them all as parties and be named
individually as plaintiffs in the complaint. These individuals claim to
be residents of various barangays in Bian, Laguna and other
barangays in San Pedro, Laguna.
Anent the issue on the propriety of the WPI, Section 3, Rule 58 of
the Rules of Court lays down the rules for the issuance thereof.
Thus:
(a) That the applicant is entitled to the relief demanded, and the
whole or part of such relief consists in restraining the commission or
continuance of the acts complained of, or in the performance of an
act or acts, either for a limited period or perpetually;
(b) That the commission, continuance or non-performance of the act
or acts complained of during the litigation would probably work
injustice to the applicant; or
(c) That a party, court, or agency or a person is doing, threatening,
or attempting to do, or is procuring or suffering to be done, some
act or acts probably in violation of the rights of the applicant
respecting the subject of the action or proceeding, and tending to
render the judgment ineffectual.
A writ of preliminary injunction is available to prevent a threatened
or continuous irremediable injury to parties before their claims can
[25]
be thoroughly studied and adjudicated. The requisites for its
issuance are: (1) the existence of a clear and unmistakable right that
must be protected; and (2) an urgent and paramount necessity for
[26]
the writ to prevent serious damage. For the writ to issue, the right
sought to be protected must be a present right, a legal right which
[27]
must be shown to be clear and positive. This means that the
persons applying for the writ must show that they have an
ostensible right to the final relief prayed for in their complaint.
[28]
In the case at bench, JCHA, et al. failed to establish a prima
facie proof of violation of their right to justify the issuance of a WPI.
Their right to the use of La Paz Road is disputable since they have no
clear legal right therein. As correctly ruled by the CA:
Here, contrary to the ruling of respondent Judge, private
respondents failed to prove as yet that they have a clear and
unmistakable right over the La Paz Road which was sought to be
protected by the injunctive writ. They merely anchor their purported
right over the La Paz Road on the bare allegation that they have
been using the same as public road right-of-way for more than ten
years. A mere allegation does not meet the standard of proof that
would warrant the issuance of the injunctive writ. Failure to
establish the existence of a clear right which should be judicially
protected through the writ of injunction is a sufficient ground for
denying the injunction.
Consequently, the case should be further heard by the RTC so that
the parties can fully prove their respective positions on the issues.
Due process considerations dictate that the assailed injunctive writ
is not a judgment on the merits but merely an order for the grant of
a provisional and ancillary remedy to preserve the status quo until
the merits of the case can be heard. The hearing on the application
for issuance of a writ of preliminary injunction is separate and
distinct from the trial on the merits of the main case.
[29]
The
evidence submitted during the hearing of the incident is not
conclusive or complete for only a "sampling" is needed to give the
trial court an idea of the justification for the preliminary injunction
[30]
pending the decision of the case on the merits. There are vital
facts that have yet to be presented during the trial which may not be
obtained or presented during the hearing on the application for the
[31]
injunctive writ. Moreover, the quantum of evidence required for
[32]
one is different from that for the other.
WHEREFORE, the petitions are DENIED. Accordingly, the July 31,
2001 Decision and February 21, 2002 Resolution of the Court of
Appeals in CA-G.R. SP No. 60543 are AFFIRMED.
SO ORDERED.
14. ERNESTO C. DEL ROSARIO and DAVAO TIMBER CORPORATION vs
FAR EAST BANK & TRUST COMPANY[1] and PRIVATE DEVELOPMENT
CORPORATION OF THE PHILIPPINES
CARPIO MORALES, J.:
The Regional Trial Court (RTC) of Makati City, Branch 65
[2] [3]
(sic) having, by Decision of July 10, 2001, dismissed petitioners
complaint in Civil Case No. 00-540 on the ground of res judicata and
splitting of a cause of action, and by Order of September 24,
[4]
2001 denied their motion for reconsideration thereof, petitioners
filed the present petition for review on certiorari.
From the rather lengthy history of the present controversy, a recital
of the following material facts culled from the records is in order.
On May 21, 1974, petitioner Davao Timber Corporation (DATICOR)
and respondent Private Development Corporation of the Philippines
(PDCP) entered into a loan agreement under which PDCP extended
to DATICOR a foreign currency loan of US $265,000 and a peso loan
of P2.5 million or a total amount of approximately P4.4 million,
computed at the then prevailing rate of exchange of the dollar with
the peso.
The loan agreement provided, among other things, that DATICOR
shall pay: (1) a service fee of one percent (1%) per annum (later
increased to six percent [6%] per annum) on the outstanding
balance of the peso loan; (2) 12 percent (12%) per annum interest
on the peso loan; and (3) penalty charges of two percent (2%) per
month in case of default.
The loans were secured by real estate mortgages over six parcels of
land one situated in Manila (the Otis property) which was registered
in the name of petitioner Ernesto C. Del Rosario, and five in Mati,
Davao Oriental and chattel mortgages over pieces of machinery and
equipment.
Petitioners paid a total of P3 million to PDCP, which the latter
applied to interest, service fees and penalty charges. This left
petitioners, by PDCPs computation, with an outstanding balance on
the principal of more than P10 million as of May 15, 1983.
By March 31, 1982, petitioners had filed a complaint against PDCP
before the then Court of First Instance (CFI) of Manila for violation of
the Usury Law, annulment of contract and damages. The case,
docketed as Civil Case No. 82-8088, was dismissed by the CFI.
On appeal, the then Intermediate Appellate Court (IAC) set aside the
CFIs dismissal of the complaint and declared void and of no effect
34
the stipulation of interest in the loan agreement between DATICOR
and PDCP.
PDCP appealed the IACs decision to this Court where it was
docketed as G.R. No. 73198.
In the interim, PDCP assigned a portion of its receivables from
petitioners (the receivables) to its co-respondent Far East Bank and
Trust Company (FEBTC) under a Deed of Assignment dated April 10,
[5]
1987 for a consideration of P5,435,000. The Deed of Assignment
[6]
was later amended by two Supplements.
FEBTC, as assignee of the receivables, and petitioners later executed
a Memorandum of Agreement (MOA) dated December 8,
[7]
1988 whereby petitioners agreed to, as they did pay FEBTC the
amount of P6.4 million as full settlement of the receivables.
On September 2, 1992, this Court promulgated its Decision in G.R.
[8]
No. 73198 affirming in toto the decision of the IAC. It determined
that after deducting the P3 million earlier paid by petitioners to
PDCP, their remaining balance on the principal loan was only P1.4
million.
[9]
Petitioners thus filed on April 25, 1994 a Complaint for sum of
money against PDCP and FEBTC before the RTC of Makati, mainly to
recover the excess payment which they computed to be P5.3
[10]
million P4.335 million from PDCP, and P965,000 from FEBTC. The
case, Civil Case No. 94-1610, was raffled to Branch 132 of
the Makati RTC.
On May 31, 1995, Branch 132 of the Makati RTC rendered a
[11]
decision in Civil Case No. 94-1610 ordering PDCP to pay
[12]
petitioners the sum of P4.035 million, to bear interest at 12% per
annum from April 25, 1994 until fully paid; to execute a release or
cancellation of the mortgages on the five parcels of land in Mati,
Davao Oriental and on the pieces of machinery and equipment and
to return the corresponding titles to petitioners; and to pay the
costs of the suit.
As for the complaint of petitioners against respondent FEBTC, the
trial court dismissed it for lack of cause of action, ratiocinating that
the MOA between petitioners and FEBTC was not subject to this
Courts Decision in G.R. No. 73198, FEBTC not being a party thereto.
From the trial courts decision, petitioners and respondent PDCP
appealed to the Court of Appeals (CA). The appeal was docketed as
CA-G.R. CV No. 50591.
[13]
On May 22, 1998, the CA rendered a decision in CA-G.R. CV No.
50591, holding that petitioners outstanding obligation, which this
Court had determined in G.R. No. 73198 to be P1.4 million, could not
be increased or decreased by any act of the creditor PDCP.
The CA held that when PDCP assigned its receivables, the
amount payable to it by DATICOR was the same amount payable to
assignee FEBTC, irrespective of any stipulation that PDCP and FEBTC
might have provided in the Deed of Assignment, DATICOR not
having been a party thereto, hence, not bound by its terms.
[14] [15]
Citing Articles 2154 and 2163 of the Civil Code which embody
the principle of solutio indebiti, the CA held that the party bound to
[16]
refund the excess payment of P5 million was FEBTC as it received
the overpayment; and that FEBTC could recover from PDCP the
amount of P4.035 million representing its overpayment for the
assigned receivables based on the terms of the Deed of Assignment
or on the general principle of equity.
Noting, however, that DATICOR claimed in its complaint only the
amount of P965,000 from FEBTC, the CA held that it could not grant
a relief different from or in excess of that prayed for.
Finally, the CA held that the claim of PDCP against DATICOR for the
payment of P1.4 million had no basis, DATICORs obligation having
already been paid in full, overpaid in fact, when it paid assignee
FEBTC the amount of P6.4 million
Accordingly, the CA ordered PDCP to execute a release or
cancellation of the mortgages it was holding over the Mati real
properties and the machinery and equipment, and to return the
corresponding certificates of title to petitioners. And it ordered
FEBTC to pay petitioners the amount of P965,000 with legal interest
from the date of the promulgation of its judgment.
FEBTCs motion for reconsideration of the CA Decision was denied,
and so was its subsequent appeal to this Court.
On April 25, 2000, petitioners filed before the RTC of Makati a
[17]
Complaint against FEBTC to recover the balance of the excess
[18]
payment of P4.335 million. The case was docketed as Civil Case
No. 00-540, the precursor of the present case and raffled to Branch
143 of the RTC.
[19]
In its Answer, FEBTC denied responsibility, it submitting that
nowhere in the dispositive portion of the CA Decision in CA-G.R. CV
No. 50591 was it held liable to return the whole amount of P5.435
million representing the consideration for the assignment to it of the
receivables, and since petitioners failed to claim the said whole
amount in their original complaint in Civil Case No. 94-1610 as they
were merely claiming the amount of P965,000 from it, they were
barred from claiming it.
[20]
FEBTC later filed a Third Party Complaint against PDCP praying
that the latter be made to pay the P965,000 and the interests
adjudged by the CA in favor of petitioners, as well as the P4.335
million and interests that petitioners were claiming from it. It
posited that PDCP should be held liable because it received a
consideration of P5.435 million when it assigned the receivables.
[21]
Answering the Third Party Complaint, PDCP contended that since
petitioners were not seeking the recovery of the amount
of P965,000, the same cannot be recovered via the third party
complaint.
PDCP went on to contend that since the final and executory
decision in CA-G.R. CV No. 50591 had held that DATICOR has no
cause of action against it for the refund of any part of the excess
payment, FEBTC can no longer re-litigate the same issue.
Moreover, PDCP contended that it was not privy to the MOA which
explicitly excluded the receivables from the effect of the Supreme
Court decision, and that the amount of P6.4 million paid by
petitioners to FEBTC was clearly intended as consideration for the
release and cancellation of the lien on the Otis property.
[22]
Replying, FEBTC pointed out that PDCP cannot deny that it
benefited from the assignment of its rights over the receivables from
petitioners. It added that the third party claim being founded on a
valid and justified cause, PDCPs counterclaims lacked factual and
legal basis.
Petitioners thereafter filed a Motion for Summary Judgment
[23]
to
which FEBTC filed its opposition.
[24]
By Order of March 5, 2001, the trial court denied the motion for
[25]
summary judgment for lack of merit.
35
On July 10, 2001, the trial court issued the assailed Decision
dismissing petitioners complaint on the ground of res judicata and
splitting of cause of action. It recalled that petitioners had filed Civil
Case No. 94-1610 to recover the alleged overpayment both from
PDCP and FEBTC and to secure the cancellation and release of their
mortgages on real properties, machinery and equipment; that when
said case was appealed, the CA, in its Decision, ordered PDCP to
release and cancel the mortgages and FEBTC to pay P965,000 with
interest, which Decision became final and executory on November
23, 1999; and that a Notice of Satisfaction of Judgment between
petitioners and FEBTC was in fact submitted on August 8, 2000,
hence, the issue between them was finally settled under the
doctrine of res judicata.
The trial court moreover noted that the MOA between petitioners
and FEBTC clearly stated that the pending litigation before the
Supreme Court of the Philippines with respect to the Loan exclusive
of the Receivables assigned to FEBTC shall prevail up to the extent
not covered by this Agreement. That statement in the MOA, the trial
court ruled, categorically made only the loan subject to this Courts
Decision in G.R. No. 73198, hence, it was with the parties full
knowledge and consent that petitioners agreed to pay P6.4 million
to FEBTC as consideration for the settlement. The parties cannot
thus be allowed to welsh on their contractual obligations, the trial
court concluded.
Respecting the third party claim of FEBTC, the trial court held
that FEBTCs payment of the amount of P1,224,906.67 (P965,000
plus interest) to petitioners was in compliance with the final
judgment of the CA, hence, it could not entertain such claim because
the Complaint filed by petitioners merely sought to recover from
FEBTC the alleged overpayment of P4.335 million and attorneys fees
of P200,000.
[26]
Petitioners motion for reconsideration of the July 10,
2001 decision of the trial court was denied by Order of September
24, 2001.
Hence, the present petition.
[27]
In their Memorandum, petitioners proffer that, aside from the
issue of whether their complaint is dismissible on the ground
of res judicata and splitting of cause of action, the issues of 1)
whether FEBTC can be held liable for the balance of the
overpayment of P4.335 million plus interest
which petitioners previously claimed against PDCP in Civil Case No.
94-1610, and 2) whether PDCP can interpose as defense the
provision in the Deed of Assignment and the MOA that the
assignment of the receivables shall not be affected by this Courts
Decision in G.R. No. 73198, be considered.
Stripped of the verbiage, the only issue for this Courts consideration
is the propriety of the dismissal of Civil Case No. 00-540 upon the
grounds stated by the trial court.This should be so because a Rule 45
petition, like the one at bar, can raise only questions of law (and that
justifies petitioners elevation of the case from the trial court directly
[28]
to this Court) which must be distinctly set forth.
The petition is bereft of merit.
Section 47 of Rule 39 of the Rules of Court, on the doctrine
of res judicata, reads:
Sec. 47. Effect of judgments or final orders. The effect of a judgment
or final order rendered by a court of the Philippines, having
jurisdiction to pronounce the judgment or final order, may be as
follows:
xxxx
(b) In other cases, the judgment or final order is, with respect to the
matter directly adjudged or as to any other matter that could have
been raised in relation thereto, conclusive between the parties and
their successors in interest by title subsequent to the
commencement of the action or special proceeding, litigating for the
same thing and under the same title and in the same capacity; and
(c) In any other litigation between the same parties or their
successors in interest, that only is deemed to have been adjudged in
a former judgment or final order which appears upon its face to
have been so adjudged, or which was actually and necessarily
included therein or necessary thereto. (Underscoring supplied)
The above-quoted provision lays down two main rules. Section
49(b) enunciates the first rule of res judicata known as bar by prior
judgment or estoppel by judgment, which states that the judgment
or decree of a court of competent jurisdiction on the merits
concludes the parties and their privies to the litigation and
constitutes a bar to a new action or suit involving the same cause of
[29]
action either before the same or any other tribunal.
Stated otherwise, bar by former judgment makes the judgment
rendered in the first case an absolute bar to the subsequent action
since that judgment is conclusive not only as to the matters offered
and received to sustain it but also as to any other matter which
might have been offered for that purpose and which could have
[30]
been adjudged therein. It is in this concept that the term res
judicata is more commonly and generally used as a ground for a
[31]
motion to dismiss in civil cases.
The second rule of res judicata embodied in Section 47(c), Rule 39 is
conclusiveness of judgment. This rule provides that any right, fact, or
matter in issue directly adjudicated or necessarily involved in the
determination of an action before a competent court in which a
judgment or decree is rendered on the merits is conclusively settled
by the judgment therein and cannot again be litigated between the
parties and their privies whether or not the claim or demand,
[32]
purpose, or subject matter of the two suits is the same. It refers
to a situation where the judgment in the prior action operates as an
estoppel only as to the matters actually determined or which were
[33]
necessarily included therein.
The case at bar satisfies the four essential requisites of bar by prior
judgment, viz:
(a) finality of the former judgment;
(b) the court which rendered it had jurisdiction over the subject
matter and the parties;
(c) it must be a judgment on the merits; and
(d) there must be, between the first and second actions, identity of
[34]
parties, subject matter and causes of action.
There is no doubt that the judgment on appeal relative to Civil Case
No. 94-1610 (that rendered in CA-G.R. CV No. 50591) was a final
judgment. Not only did it dispose of the case on the merits; it also
became executory as a consequence of the denial of FEBTCs motion
[35]
for reconsideration and appeal.
Neither is there room to doubt that the judgment in Civil Case No.
94-1610 was on the merits for it determined the rights and liabilities
[36]
of the parties. To recall, it was ruled that: (1) DATICOR overpaid
by P5.3 million; (2) FEBTC was bound to refund the excess payment
but because DATICORs claim against FEBTC was only P965,000, the
court could only grant so much as the relief prayed for; and (3) PDCP
has no further claim against DATICOR because its obligation had
already been paid in full.
36
Right or wrong, that judgment bars another case based upon the
[37]
same cause of action.
As to the requisite of identity of parties, subject matter and causes
of action, it cannot be gainsaid that the first case, Civil Case No. 94-
1610, was brought by petitioners to recover an alleged overpayment
of P5.3 million P965,000 from FEBTC and P4.335 million from PDCP.
On the other hand, Civil Case No. 00-540, filed by the same
petitioners, was for the recovery of P4.335 million which is
admittedly part of the P5.3 million earlier sought to be recovered in
Civil Case No. 94-1610. This time, the action was brought solely
against FEBTC which in turn impleaded PDCP as a third party
defendant.
In determining whether causes of action are identical to warrant the
application of the rule of res judicata, the test is to ascertain
whether the same evidence which is necessary to sustain the second
action would suffice to authorize a recovery in the first even in cases
in which the forms or nature of the two actions are
[38]
different. Simply stated, if the same facts or evidence would
sustain both, the two actions are considered the same within the
rule that the judgment in the former is a bar to the subsequent
action.
It bears remembering that a cause of action is the delict or the
wrongful act or omission committed by the defendant in violation of
[39]
the primary rights of the plaintiff.
In the two cases, petitioners imputed to FEBTC the same alleged
wrongful act of mistakenly receiving and refusing to return an
amount in excess of what was due it in violation of their right to a
refund. The same facts and evidence presented in the first case, Civil
Case No. 94-1610, were the very same facts and evidence that
petitioners presented in Civil Case No. 00-540.
Thus, the same Deed of Assignment between PDCP and FEBTC, the
first and second supplements to the Deed, the MOA between
petitioners and FEBTC, and this Courts Decision in G.R. No. 73198
were submitted in Civil Case No. 00-540.
Notably, the same facts were also pleaded by the parties in support
of their allegations for, and defenses against, the recovery of
the P4.335 million. Petitioners, of course, plead the CA Decision as
basis for their subsequent claim for the remainder of their
overpayment. It is well established, however, that a party cannot, by
varying the form of action or adopting a different method of
presenting his case, or by pleading justifiable circumstances as
herein petitioners are doing, escape the operation of the principle
[40]
that one and the same cause of action shall not be twice litigated.
In fact, authorities tend to widen rather than restrict the doctrine
of res judicata on the ground that public as well as private
interest demands the ending of suits by requiring the parties to sue
once and for all in the same case all the special proceedings and
[41]
remedies to which they are entitled.
This Court finds well-taken then the pronouncement of the court a
quo that to allow the re-litigation of an issue that was finally settled
as between petitioners and FEBTC in the prior case is to allow the
splitting of a cause of action, a ground for dismissal under Section 4
of Rule 2 of the Rules of Court reading:
SEC. 4. Splitting of a single cause of action; effect of. If two or more
suits are instituted on the basis of the same cause of action, the
filing of one or a judgment upon the merits in any one is available
as a ground for the dismissal of the others. (Emphasis and
underscoring supplied)
This rule proscribes a party from dividing a single or indivisible cause
of action into several parts or claims and instituting two or more
[42]
actions based on it. Because the plaintiff cannot divide the
grounds for recovery, he is mandated to set forth in his first action
every ground for relief which he claims to exist and upon which he
relies; he cannot be permitted to rely upon them by piecemeal in
successive actions to recover for the same wrong or injury.
[43]
Clearly then, the judgment in Civil Case No. 94-1610 operated as a
bar to Civil Case No. 00-540, following the above-quoted Section 4,
Rule 2 of the Rules of Court.
A final word. Petitioners are sternly reminded that both the rules
on res judicata and splitting of causes of action are based on the
salutary public policy against unnecessary multiplicity of
[44]
suits interest reipublicae ut sit finis litium. Re-litigation of matters
already settled by a courts final judgment merely burdens the courts
and the taxpayers, creates uneasiness and confusion, and wastes
valuable time and energy that could be devoted to worthier
cases.
[45]
WHEREFORE, the Petition is DENIED. The assailed Decision of the
RTC, Branch 143, Makati dismissing petitioners complaint in Civil
Case No. 00-540 is AFFIRMED.
Costs against petitioners.
SO ORDERED.
15. PROGRESSIVE DEVELOPMENT CORPORATION,
INC., petitioner, vs. COURT OF APPEALS and WESTIN SEAFOOD
MARKET, INC., respondents.
DECISION
BELLOSILLO, J.:
May the lessee which instituted before the Metropolitan Trial Court
an action for forcible entry with damages against its lessor file a
separate suit with the Regional Trial Court against the same lessor
for moral and exemplary damages plus actual and compensatory
damages based on the same forcible entry?
On grounds of litis pendencia and forum-shopping, petitioner
invokes established jurisprudence that a party cannot by varying the
form of action or adopting a different method of presenting his case
evade the principle that the same cause of action shall not be
litigated twice between the same parties or their
[1]
privies. Petitioner therefore prays for reversal of the decision of
the Court of Appeals dated 27 May 1995, as well as its Resolution
dated 17 January 1996 denying reconsideration, which upheld the
denial by the Regional Trial Court of petitioner's motion to dismiss
private respondent's damage suit.
The antecedents: On 27 May 1991 petitioner leased to private
respondent Westin Seafood Market, Inc., a parcel of land with a
commercial building thereon located at Araneta Center, Cubao,
Quezon City, for a period of nine (9) years and three (3) months, i.e.,
from 2 January 1989 to 30 April 1998, with a monthly rental of
approximately P600,000.00. The contract contained, among others,
the following pertinent terms and conditions:
EFFECT OF VIOLATIONS
25. LESSEE hereby agrees that all the provisions contained in this
Contract shall be deemed as conditions, as well as covenants, and
that this Contract shall be automatically terminated and cancelled
without resorting to court action should LESSEE violate any or all
37
said conditions, including the payment of Rent, CUSA and other
charges indicated in the FLP when due within the time herein
stipulated and in any such cases, LESSEE hereby irrevocably appoints
LESSOR, its authorized agents, employees and/or representatives as
his duly authorized attorney-in-fact, even after the termination,
expiration or cancellationof this Contract, with full power and
authority to open, enter, repossess, secure, enclose, fence and
otherwise take full and complete physical possession and control of
the leased premises and its contents without resorting to court
action and/or to summarily disconnect electrical and/or water
services thereof, and that LESSEE hereby irrevocably empowers
LESSOR, his authorized agents, employees and/or representatives to
take inventory and possession of whatever equipment, furniture,
articles, merchandise, appliances, etc., found therein belonging to
LESSEE, consignors and/or to any other persons and to place the
same in LESSORs warehouse or any other place at
LESSORs discretion for safekeeping; charging LESSEE the
corresponding storage fees therefor; that in case LESSEE fails to
claim said equipment, furniture, articles, merchandise, appliances,
etc. from storage and simultaneously liquidate any liability with
LESSOR within seven (7) days from date of said transfer to LESSORs
warehouse, LESSOR is likewise hereby expressly authorized and
empowered by LESSEE to dispose of said property/properties in a
public sale through a Notary Public of LESSORs choice and to apply
the proceeds thereof to whatever liability and/or indebtedness
LESSEE may have to LESSOR plus reasonable expenses for the same,
including storage fees, and the balance, if any, shall be turned over
to LESSEE; that LESSEE hereby expressly agrees that any or all acts
performed by LESSOR, his authorized agents, employees and/or
representatives under the provisions of this Section may not be the
subject of any petition for a Writ of Preliminary Injunction or
Mandatory Injunction in court, and that LESSOR and/or his
authorized agents, employees, and/or representatives shall be free
from any civil and/or criminal liability or responsibility whatsoever
therefor.
TERMINATION OF LEASE
26. Upon the automatic termination of this lease contract, as the
case may be, LESSEE shall immediately vacate and redeliver physical
possession of the leased premises, including the keys appertaining
thereto, to LESSOR in good, clean and sanitary condition, reasonable
wear and tear excepted, devoid of all occupants, equipment,
furniture, articles, merchandise, etc., belonging to LESSEE or to any
other person except those belonging to LESSOR; that should LESSEE
fail to comply with this provision, LESSOR is hereby given the same
rights and power to proceed against LESSEE as expressly granted in
the immediately preceding section.
Private respondent failed to pay rentals despite several demands by
petitioner. As of 19 October 1992 the arrearages amounted
to P8,608,284.66. Admittedly, non-payment of rentals constituted
breach of their contract; thus, pursuant to the express authority
granted petitioner under the above-quoted Secs. 25 and 26 of the
lease agreement, petitioner on 31 October 1992 repossessed the
leased premises, inventoried the movable properties found within
and owned by private respondent and scheduled public auction for
the sale of the movables on 19 August 1993 with notice to private
respondent.
On 26 November 1992 private respondent filed with the
Metropolitan Trial Court of Quezon City a complaint against
petitioner for forcible entry with damages and a prayer for a
temporary restraining order and/or writ of
[2]
preliminary injunction. The case was raffled to Branch 40 presided
over by Judge Guillermo L. Loja Jr. who issued a temporary
restraining order enjoining petitioner from selling private
respondents properties at a public auction.
On 9 December 1992 Judge Loja inhibited himself from trying the
case and directed its transfer to Branch 34 presided over by Judge
Joselito SD Generoso. Soon after, petitioner filed an urgent motion
for the inhibition of Judge Generoso and the immediate reraffle of
the case arguing that the summary transfer of the case to Judge
Generoso was irregular as it was not done by raffle.
The motion was granted and the case went to Branch 36 presided
over by Judge Francisco D. Villanueva. Thereafter, on 22 December
1992, at the continuation of the hearing on the issuance of a writ
preliminary mandatory injunction, the parties agreed, among others,
on the following: (a) private respondent would deposit with the
Philippine Commercial and Industrial Bank in the name of
theMetropolitan Trial Court, Branch 36, the amount
of P8,000,000.00 to guarantee the payment of its back rentals; (b)
petitioner would defer the sale of the personal properties of the
Westin Seafood Market, Inc., until a final settlement of the case had
been arrived at; (c) petitioner shall allow private respondent to
retrieve all the perishable goods from inside the leased premises like
frozen meat, vegetables and fish, all properly receipted for; (d)
petitioner shall allow three (3) maintenance personnel of private
respondent to enter the premises at reasonable working hours to
maintain the restaurant equipment; and (e) the parties shall
negotiate for the restoration of the premises to private respondent,
and if no settlement be arrived at on or before January 8, 1993, the
hearing on the merits of the case shall proceed and the disposition
of the amount deposited representing the rental arrearages shall be
left to the discretion of the court.
This agreement was incorporated in the order of the court dated 22
[3]
December 1992 which in effect terminated for all intents and
purposes the incident on the issuance of a preliminary writ of
injunction.
Private respondent did not comply with its undertaking to deposit
with the designated bank the amount representing its back
rentals. Instead, with the forcible entry case still pending with the
MeTC, private respondent instituted on 9 June 1993 another action
for damages against petitioner with the Regional Trial Court of
Quezon City. The case was raffled to Branch 101 presided over by
[4]
Judge Pedro T. Santiago.
Petitioner filed a motion to dismiss the damage suit on the ground
of litis pendencia and forum shopping. On 2 July 1993, instead of
ruling on the motion, Judge Santiago issued an order archiving the
case pending the outcome of the forcible entry case being heard at
the MeTC for the reason that "the damages is (sic) principally
anchored on whether or not the defendants (petitioner herein) have
[5]
committed forcible entry." On 2 August 1993 petitioner moved for
reconsideration of the order and reiterated its motion to dismiss the
suit for damages.
Before petitioner's motion to dismiss could be resolved,
private respondent filed with the RTC on 18 August 1993 an
amended complaint for damages. On 14 September 1993 it also filed
an Urgent Ex-Parte Motion for the Issuance of a Temporary
Restraining Order and Motion for the Grant of a Preliminary
Prohibitory and Preliminary Mandatory Injunction. On the very same
day, Judge Santiago issued an order (a) denying petitioner's motion
to dismiss, (b) admitting private respondent's amended complaint,
and (c) granting private respondent's application for a temporary
restraining order against petitioner.
Thus, petitioner filed with the Court of Appeals a special civil action
for certiorari and prohibition on the ground that Judge Santiago
acted in excess of his jurisdiction and/or committed grave abuse of
discretion amounting to lack of jurisdiction in admitting the
amended complaint of private respondent and issuing a restraining
order against petitioner; in allowing private respondent to engage in
38
forum shopping; and, taking cognizance of the action for damages
[6]
despite lack of jurisdiction.
But the Court of Appeals dismissed the petition due to the failure of
petitioner to file a motion for reconsideration of Judge Santiago's
order of 14 September 1993 which, it explained, was a prerequisite
to the institution of a petition for certiorari and prohibition. It also
found that the elements of litis pendencia were lacking to justify the
dismissal of the action for damages with the RTC because despite
the pendency of the forcible entry case with the MeTC the only
damages recoverable thereat were those caused by the loss of the
use and occupation of the property and not the kind of damages
being claimed before the RTC which had no direct relation to loss
of material possession. It clarified that since the damages prayed for
in the amended complaint with the RTC were those caused by the
alleged high-handed manner with which petitioner reacquired
possession of the leased premises and the sale of private
respondents movables found therein, the RTC and not the MeTC had
jurisdiction over the action of damages.
[7]
Petitioner, aggrieved by the decision of the appellate court, filed the
instant petition for review on certiorari under Rule 45 of the Rules of
Court alleging that it erred in (a) finding that petitioner failed to avail
of its plain, speedy and adequate remedy of a prior motion for
reconsideration with the RTC; (b) ruling that the trial judge did not
act with grave abuse of discretion in taking cognizance of the action
for damages and injunction despite the pendency of the forcible
entry case with the MeTC; and, (c) ruling that private respondent did
not commit forum shopping since the causes of action before the
RTC and MeTC were not identical with each other.
There is merit in the petition. While generally a motion for
reconsideration must first be filed before resorting to certiorari in
order to give the lower court an opportunity to correct the errors
[8]
imputed to it this rule admits of exceptions and is not intended to
[9]
be applied without considering the circumstances of the case. The
filing of the motion for reconsideration before availing of the
remedy of certiorari is not sine qua non when the issue raised is one
[10]
purely of law, or where the error is patent or the disputed order is
[11]
void, or the questions raised on certiorari are the same as those
already squarely presented to and passed upon by the lower court.
In its motion for dismissal of the action for damages with the RTC
petitioner raised the ground that another action for forcible entry
was pending at the MeTC between the same parties involving the
same matter and cause of action. Outrightly rejected by the RTC, the
same issue was elevated by petitioner on certiorari before the Court
of Appeals. Clearly, under the prevailing circumstance, any motion
for reconsideration of the trial court would have been a pointless
exercise.
[12]
We now turn to the issue of whether an action for damages filed
with the Regional Trial Court by the lessee against the lessor should
be dismissed on the ground of pendency of another action for
forcible entry and damages earlier filed by the same lessee against
the same lessor before the Metropolitan Trial Court.
Section 1 of Rule 70 of the Rules of Court provides that any person
deprived of the possession of any land or building by force,
indimidation, threat, strategy or stealth, or against whom the
possession of any land or building is unlawfully withheld, may bring
an action in the proper Municipal Trial Court against the person or
persons unlawfully withholding or depriving of possession, together
with damages and costs. The mandate under this rule is
categorical: that all cases for forcible entry or unlawful detainer shall
be filed before the Municipal Trial Court which shall include not only
the plea for restoration of possession but also all claims for damages
and costs arising therefrom. Otherwise expressed, no claim for
damages arising out of forcible entry or unlawful detainer may be
filed separately and independently of the claim for restoration of
possession.
This is consistent with the principle laid down in Sec. 1, par. (e), of
Rule 16 of the Rules of Court which states that the pendency of
another action between the same parties for the same cause is a
ground for dismissal of an action. Res adjudicata requires that there
must be between the action sought to be dismissed and the other
action the following elements: (a) identity of parties or at least such
as representing the same interest in both actions; (b) identity of
rights asserted and relief prayed for, the relief being founded on the
same facts; and, (c) the identity in the two (2) preceding particulars
should be such that any judgment which may be rendered on the
other action will, regardless of which party is successful, amount
[13]
to res adjudicata in the action under consideration.
It is likewise basic under Sec. 3 of Rule 2 of the Revised Rules of
Court, as amended, that a party may not institute more than one
suit for a single cause of action. Under Sec. 4 of the same Rule, if two
or more suits are instituted on the basis of the same cause of action,
the filing of one or a judgment upon the merits in any one is
available as a ground for the dismissal of the other or others. "Cause
of action" is defined by Sec. 2 of Rule 2 as the act of omission by
[14]
which a party violates a right of another. These premises
obtaining, there is no question at all that private respondent's cause
of action in the forcible entry case and in the suit for damages is the
alleged illegal retaking of possession of the leased premises by the
lessor, petitioner herein, from which all legal reliefs arise. Simply
stated, the restoration of possession and demand for actual
damages in the case before the MeTC and the demand
for damages with the RTC both arise from the same cause of action,
i.e., the forcible entry by petitioner into the leased premises.
A comparative study of the two (2) complaints filed by private
respondent against petitioner before the two (2) trial courts shows
that not only are the elements of res adjudicata present, at least
insofar as the claim for actual and compensatory damages is
concerned, but also that the claim for damages - moral and
exemplary in addition to actual and compensatory - constitutes
splitting a single cause of action.Since this runs counter to the rule
against multiplicity of suits, the dismissal of the second action
becomes imperative.
The complaint for forcible entry contains the following pertinent
allegations -
2.01 On 02 January 1989, plaintiff entered into a contract of lease
with defendant PDC over a property designated as Ground Floor,
Seafood Market (hereinafter Subject Premises) situated at the
corner of EDSA corner MacArthur Street, Araneta Center, Cubao,
Quezon City, for a period of ten (10) years from 02 January 1989 to
30 April 1998.
2.02 Immediately after having acquired actual physical possession of
the Subject Premises, plaintiff established and now operates
thereon the now famous Seafood Market Restaurant. Since then,
plaintiff had been in actual, continuous, and peaceful physical
possession of the Subject Premises until 31 October 1992.
xxxx
3.02 Plaintiff, being the lessee of the Subject Premises, is entitled to
the peaceful occupation and enjoyment of the Subject Premises to
the exclusion of all others, including defendants herein.
3.03 Defendants resort to strong arms tactics to forcibly wrest
possession of the Subject Premises from plaintiff and maintain
possession thereof through the use of force, threat, strategy and
intimidation by the use of superior number of men and arms
amounts to the taking of the law into their own hands.
39
3.04 Thus, defendants act of unlawfully evicting out plaintiff from
the Subject Premises it is leasing from defendant PDC and depriving
it of possession thereof through the use of force, threat, strategy
and intimidation should be condemned and declared illegal for being
contrary to public order and policy.
3.05 Consequently, defendants should be enjoined from continuing
with their illegal acts and be ordered to vacate the Subject Premises
and restore possession thereof, together with its contents, to
plaintiff.
xxxx
4.07 Considering that defendants act of forcibly grabbing possession
of the Subject Premises from plaintiff is illegal and null and void,
defendant should be adjudged liable to plaintiff for all the
aforedescribed damages which plaintiff incurred as a result thereof.
The amended complaint for damages filed by private respondent
alleges basically the same factual circumstances and issues as bases
for the relief prayed for, to wit:
4. On May 28, 1991, plaintiff and defendant PDC entered into a
Contract of Lease for a period of ten years or from January 2, 1989
up to April 30, 1998 over a property designated as Ground Floor,
Seafood Market (hereinafter referred to as Subject Premises)
situated at the corner of EDSA corner McArthur Street, Araneta
Center, Cubao, Quezon City. A copy of the lease contract is attached
hereto as Annex A.
5. Immediately thereafter, plaintiff took over actual physical
possession of Subject Premises, and established thereon the now
famous Seafood Market Restaurant.
xxxx
7. On October 31, 1992 at around 8:30 p.m., defendant PDC, without
the benefit of any writ of possession or any lawful court order and
with the aid of approximately forty (40) armed security guards and
policemen under the supervision of defendant Tejam, forcibly
entered the subject premises through force, intimidation, threats
and stealth and relying on brute force and in a thunderboltish
manner and against plaintiffs will, unceremoniously drew away all of
plaintiffs men out of the subject premises, thereby depriving herein
plaintiff of its actual, physical and natural possession of the subject
premises. The illegal, high-handed manner and gestapo like take-
over by defendants of subject premises is more particularly
described as follows: x x x
8. To date, defendants continue to illegally possess and hold the
Subject Premises, including all the multi-million improvements,
fixtures and equipment therein owned by plaintiff, all to the damage
and prejudice of plaintiff. The actuations of defendants constitute an
unlawful appropriation, seizure and taking of property against the
will and consent of plaintiff. Worse, defendants are threatening to
sell at public auction and without the consent of plaintiff and
without lawful authority, the multi-million fixtures and equipment of
plaintiff and at prices way below the market value thereof. Plaintiff
hereby attaches as Annex B the letter from defendants dated August
6, 1993 addressed to plaintiff, informing the latter that the former
intends to sell at an auction on August 19, 1993 at 2:00 p.m.
properties of the plaintiff presently in defendants possession.
xxxx
12. Defendants unlawful takeover of the premises constitutes a
violation of its obligation under Art. 1654 of the New Civil Code
requiring the lessor to maintain the lessee in peaceful and adequate
enjoyment of the lease for the entire duration of the
contract. Hence, plaintiff has filed the present suit for the recovery
of damages under Art. 1659 of the New Civil Code x x x x
Restated in its bare essentials, the forcible entry case has one cause
of action, namely, the alleged unlawful entry by petitioner into the
leased premises out of which three (3) reliefs (denominated by
private respondent as its causes of action) arose: (a) the restoration
by the lessor (petitioner herein) of the possession of the leased
premises to the lessee; (b) the claim for actual damages due to the
losses suffered by private respondent such as the deterioration of
perishable foodstuffs stored inside the premises and the deprivation
of the use of the premises causing loss of expected profits; and, (c)
the claim for attorney's fees and costs of suit.
On the other hand, the complaint for damages prays for a monetary
award consisting of (a) moral damages of P500,000.00 and
exemplary damages of another P500,000.00; (b) actual damages
of P20,000,000.00 and compensatory damages of P1,000,000.00
representing unrealized profits; and, (c) P200,000.00 for attorney's
fees and costs, all based on the alleged forcible takeover of the
leased premises by petitioner. Since actual
and compensatory damages were already prayed for in the forcible
entry case before the MeTC, it is obvious that this cannot be
relitigated in the damage suit before the RTC by reason of res
adjudicata.
The other claims for moral and exemplary damages cannot also
succeed considering that these sprung from the main incident being
heard before the MeTC. Jurisprudence is unequivocal that when a
single delict or wrong is committed - like the unlawful taking or
detention of the property of another - there is but one single cause
of action regardless of the number of rights that may have been
violated, and all such rights should be alleged in a single complaint
[15]
as constituting one single cause of action. In a forcible entry case,
the real issue is the physical possession of the real property. The
question of damages is merely secondary or incidental, so much so
that the amount thereof does not affect
the jurisdiction of the court. In other words, the unlawful act of a
deforciant in taking possession of a piece of land by means of force
and intimidation against the rights of the party actually in possession
thereof is a delict or wrong, or a cause of action that gives rise to
two (2) remedies, namely, the recovery of possession and recovery
of damages arising from the loss of possession, but only to one
action. For obvious reasons, both remedies cannot be the subject of
two (2) separate and independent actions, one for recovery of
possession only, and the other, for the recovery of damages. That
would inevitably lead to what is termed in law as splitting up a cause
[16] [17]
of action. In David v. de la Cruz we observed -
Herein tenants have but one cause of action against their landlord,
their illegal ejectment or removal from their landholdings, which
cause of action however entitles them to two (2) claims or remedies
- for reinstatement and damages. As both claims arise from the
same cause of action, they should be alleged in a single complaint.
A claim cannot be divided in such a way that a part of the amount of
damages may be recovered in one case and the rest, in
[18] [19]
another. In Bachrach v. Icarangal we explained that the rule
was aimed at preventing repeated litigations between the same
parties in regard to the same subject of the controversy and to
protect the defendant from unnecessary vexation. Nemo debet bis
vexari pro una et eadem causa.
What then is the effect of the dismissal of the other action? Since
the rule is that all such rights should be alleged in a single complaint,
it goes without saying that those not therein included cannot be the
[20]
subject of subsequent complaints for they are barred forever. If a
suit is brought for a part of a claim, a judgment obtained in that
action precludes the plaintiff from bringing a second action for the
40
residue of the claim, notwithstanding that the second form of action
is not identical with the first or different grounds for relief are set for
the second suit. This principle not only embraces what was actually
determined, but also extends to every matter which the parties
[21]
might have litigated in the case. This is why the legal basis upon
which private respondent anchored its second claim for damages,
[22]
i.e., Art. 1659 in relation to Art. 1654 of the Civil Code, not
otherwise raised and cited by private respondent in the forcible
entry case, cannot be used as justification for the second suit for
damages. We note, not without some degree of displeasure, that by
filing a second suit for damages, private respondent was not only
able to press a claim for moral and exemplary damages which by its
failure to allege the same in its suit before the MeTC foreclosed its
right to sue on it, but it was also able to obtain from the RTC, by way
of another temporary restraining order, a second reprieve from an
impending public auction sale of its movables which it could not
anymore secure from the MeTC before which the matter of the
issuance of a preliminary writ of injunction was already closed.
The foregoing discussions provide sufficient basis to petitioner's
charge that private respondent and its counsel in the trial courts
committed forum shopping. In Crisostomo v. Securities and
[23]
Exchange Commission we ruled -
There is forum-shopping whenever, as a result of an adverse opinion
in one forum, a party seeks a favorable opinion (other than by
appeal or certiorari) in another. The principle applies x x x with
respect to suits filed in the courts x x x in connection with litigations
commenced in the court x x x in anticipation of an unfavorable x x x
ruling and a favorable case where the court in which the second suit
was brought, has no jurisdiction.
This Court likewise elucidated in New Pangasinan Review, Inc. v.
[24]
National Labor Relations Commission that there is forum
shopping when the actions involve the same transactions, the same
essential facts and circumstances. The reason behind the
proscription of forum shopping is obvious. This unnecessarily
burdens our courts with heavy caseloads, unduly taxes the
manpower and financial resources of the judiciary and trifles with
and mocks our judicial processes, thereby adversely affecting the
efficient administration of justice. This condemnable conduct has
[25]
prompted the Court to issue circulars ordering among others that
a violation thereof shall be cause for the dismissal of the case or
cases without prejudice to the taking of appropriate action against
the counsel or party concerned.
The records ineluctably show that the complaint lodged by private
respondent with the Regional Trial Court of Quezon City contained
no certification of non-forum shopping. When petitioner filed a
motion to dismiss the case raising among others the ground of
forum shopping it pointed out the absence of the required
certification. The amended complaint, as well as the second and
third amended complaints, attempted to rectify the error by
invariably stating that there was no other action pending between
the parties involving the same causes of action although there was
actually a forcible entry case pending before the MTC of Quezon
City. By its admission of a pending forcible entry case, it is obvious
that private respondent was indulging in forum shopping. While
private respondent conveniently failed to inform the RTC that it had
likewise sought damages in the MTC on the basis of the same
forcible entry, the fact remains that it precisely did so, which
stratagem was being duplicated in the second case.This is a
compelling reason to dismiss the second case.
WHEREFORE, the Petition is GRANTED. The questioned Decision of
the Court of Appeals dated 27 September 1995 and the Order of the
Regional Trial Court of Quezon City dated 24 September 1993
are REVERSED and SET ASIDE. The Regional Trial Court of Quezon
City is directed to dismiss Civil Case No. Q-93-16409,
"Westin Seafood Market, Inc. v. Progressive Development
Corporation, et al.," and the Metropolitan Trial Court of Quezon City
to proceed with the proper disposition of Civil Case No. 6589,
"Westin Seafood Market, Inc. v. Progressive Development
Corporation, et al.," with dispatch considering the summary nature
of the case. Treble costs against private respondent.
SO ORDERED.
16. LUIS JOSEPH, petitioner
vs.
HON. CRISPIN V. BAUTISTA, PATROCINIO PEREZ, ANTONIO SIOSON,
JACINTO PAGARIGAN, ALBERTO CARDENO and LAZARO
VILLANUEVA, respondents.
Jose M. Castillo for petitioner.
Arturo Z. Sioson for private respondent, Patrocinio Perez.
Cipriano B. Farrales for private respondents except P. Perez.
REGALAD0, J.:
Petitioner prays in this appeal by certiorari for the annulment and
setting aside of the order, dated July 8, 1975, dismissing petitioner's
complaint, as well as the order, dated August 22, 1975, denying his
motion for reconsideration of said dismissal, both issued by
respondent Judge Crispin V. Bautista of the former Court of First
Instance of Bulacan, Branch III.
Petitioner herein is the plaintiff in Civil Case No. 50-V-73 entitled
"Luis Joseph vs. Patrocinio Perez, Domingo Villa y de Jesus, Rosario
Vargas, Antonio Sioson, Lazaro Villanueva and Jacinto Pagarigan",
filed before the Court of First Instance of Bulacan, Branch III, and
presided over by respondent Judge Crispin V. Bautista; while private
respondents Patrocinio Perez, Antonio Sioson, Jacinto Pagarigan and
Lazaro Villanueva are four of the defendants in said case. Defendant
Domingo Villa y de Jesus did not answer either the original or the
amended complaint, while defendant Rosario Vargas could not be
served with summons; and respondent Alberto Cardeno is included
herein as he was impleaded by defendant Patrocinio Perez, one of
respondents herein, in her cross-claim.
The generative facts of this case, as culled from the written
submission of the parties, are as follows:
Respondent Patrocinio Perez is the owner of a cargo truck with Plate
No. 25-2 YT Phil. '73 for conveying cargoes and passengers for a
consideration from Dagupan City to Manila. On January 12, 1973,
said cargo truck driven by defendant Domingo Villa was on its way to
Valenzuela, Bulacan from Pangasinan. Petitioner, with a cargo of
livestock, boarded the cargo truck at Dagupan City after paying the
sum of P 9.00 as one way fare to Valenzuela, Bulacan. While said
cargo truck was negotiating the National Highway proceeding
towards Manila, defendant Domingo Villa tried to overtake a tricycle
likewise proceeding in the same direction. At about the same time, a
pick-up truck with Plate No. 45-95 B, supposedly owned by
respondents Antonio Sioson and Jacinto Pagarigan, then driven by
respondent Lazaro Villanueva, tried to overtake the cargo truck
which was then in the process of overtaking the tricycle, thereby
forcing the cargo truck to veer towards the shoulder of the road and
to ram a mango tree. As a result, petitioner sustained a bone
1
fracture in one of his legs.
2
The following proceedings thereafter took place:
Petitioner filed a complaint for damages against respondent
Patrocinio Perez, as owner of the cargo truck, based on a breach of
contract of carriage and against respondents Antonio Sioson and
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Lazaro Villanueva, as owner and driver, respectively, of the pick-up
truck, based on quasi-delict.
Respondent Sioson filed his answer alleging that he is not and never
was an owner of the pick-up truck and neither would he acquire
ownership thereof in the future.
On September 24, 1973, petitioner, with prior leave of court, filed
his amended complaint impleading respondents Jacinto Pagarigan
and a certain Rosario Vargas as additional alternative defendants.
Petitioner apparently could not ascertain who the real owner of said
cargo truck was, whether respondents Patrocinio Perez or Rosario
Vargas, and who was the real owner of said pick-up truck, whether
respondents Antonio Sioson or Jacinto Pagarigan.
Respondent Perez filed her amended answer with crossclaim against
her co-defendants for indemnity and subrogation in the event she is
ordered to pay petitioner's claim, and therein impleaded cross-
defendant Alberto Cardeno as additional alternative defendant.
On September 27, 1974, respondents Lazaro Villanueva, Alberto
Cardeno, Antonio Sioson and Jacinto Pagarigan, thru their insurer,
Insurance Corporation of the Philippines, paid petitioner's claim for
injuries sustained in the amount of P 1,300.00. By reason thereof,
petitioner executed a release of claim releasing from liability the
following parties, viz: Insurance Corporation of the Philippines,
Alberto Cardeno, Lazaro Villanueva, Antonio Sioson and Jacinto
Pagarigan.
On December 2, 1974, respondents Lazaro Villanueva, Alberto
Cardeno and their insurer, the Insurance Corporation of the
Philippines, paid respondent Patrocinio Perez' claim for damages to
her cargo truck in the amount of P 7,420.61.
Consequently, respondents Sioson, Pagarigan, Cardeno and
Villanueva filed a "Motion to Exonerate and Exclude Defs/ Cross
defs. Alberto Cardeno, Lazaro Villanueva, Antonio Sioson and Jacinto
Pagarigan on the Instant Case", alleging that respondents Cardeno
and Villanueva already paid P 7,420.61 by way of damages to
respondent Perez, and alleging further that respondents Cardeno,
Villanueva, Sioson and Pagarigan paid P 1,300.00 to petitioner by
way of amicable settlement.
Thereafter, respondent Perez filed her "Opposition to Cross-defs.'
motion dated Dec. 2, 1974 and Counter Motion" to dismiss. The so-
called counter motion to dismiss was premised on the fact that the
release of claim executed by petitioner in favor of the other
respondents inured to the benefit of respondent Perez, considering
that all the respondents are solidarity liable to herein petitioner.
On July 8, 1975, respondent judge issued the questioned order
dismissing the case, and a motion for the reconsideration thereof
was denied. Hence, this appeal, petitioner contending that
respondent judge erred in declaring that the release of claim
executed by petitioner in favor of respondents Sioson, Villanueva
and Pagarigan inured to the benefit of respondent Perez; ergo, it
likewise erred in dismissing the case.
We find the present recourse devoid of merit.
The argument that there are two causes of action embodied in
petitioner's complaint, hence the judgment on the compromise
agreement under the cause of action based on quasi-delict is not a
bar to the cause of action for breach of contract of carriage, is
untenable.
A cause of action is understood to be the delict or wrongful act or
omission committed by the defendant in violation of the primary
3
rights of the plaintiff. It is true that a single act or omission can be
violative of various rights at the same time, as when the act
constitutes juridically a violation of several separate and distinct
legal obligations. However where there is only one delict or wrong,
there is but a single cause of action regardless of the number of
rights that may have been violated belonging to one person.
4
The singleness of a cause of action lies in the singleness of the- delict
or wrong violating the rights of one person. Nevertheless, if only one
injury resulted from several wrongful acts, only one cause of action
5
arises. In the case at bar, there is no question that the petitioner
sustained a single injury on his person. That vested in him a single
cause of action, albeit with the correlative rights of action against
the different respondents through the appropriate remedies
allowed by law.
The trial court was, therefore, correct in holding that there was only
one cause of action involved although the bases of recovery invoked
by petitioner against the defendants therein were not necessarily
Identical since the respondents were not identically circumstanced.
However, a recovery by the petitioner under one remedy necessarily
bars recovery under the other. This, in essence, is the rationale for
the proscription in our law against double recovery for the same act
or omission which, obviously, stems from the fundamental rule
against unjust enrichment.
There is no question that the respondents herein are solidarily liable
to petitioner. On the evidence presented in the court below, the trial
court found them to be so liable. It is undisputed that petitioner, in
his amended complaint, prayed that the trial court hold respondents
jointly and severally liable. Furthermore, the allegations in the
amended complaint clearly impleaded respondents as solidary
debtors. We cannot accept the vacuous contention of petitioner
that said allegations are intended to apply only in the event that
execution be issued in his favor. There is nothing in law or
jurisprudence which would countenance such a procedure.
The respondents having been found to be solidarity liable to
petitioner, the full payment made by some of the solidary debtors
and their subsequent release from any and all liability to petitioner
inevitably resulted in the extinguishment and release from liability of
the other solidary debtors, including herein respondent Patrocinio
Perez.
The claim that there was an agreement entered into between the
parties during the pre-trial conference that, after such payment
made by the other respondents, the case shall proceed as against
respondent Perez is both incredible and unsubstantiated. There is
nothing in the records to show, either by way of a pre-trial order,
minutes or a transcript of the notes of the alleged pre-trial hearing,
that there was indeed such as agreement.
WHEREFORE, the challenged orders of the respondent judge are
hereby AFFIRMED.
SO ORDERED.
17. REMEDIO V. FLORES, petitioner,
vs.
HON. JUDGE HEILIA S. MALLARE-PHILLIPPS, IGNACIO BINONGCAL &
FERNANDO CALION, respondents.
Lucio A. Dixon for respondent F. Calion.
FERIA, J.:
The Court rules that the application of the totality rule under Section
33(l) of Batas Pambansa Blg. 129 and Section 11 of the Interim Rules
is subject to the requirements for the permissive joinder of parties
under Section 6 of Rule 3 which provides as follows:
42
Permissive joinder of parties.-All persons in whom or against whom
any right to relief in respect to or arising out of the same transaction
or series of transactions is alleged to exist, whether jointly, severally,
or in the alternative, may, except as otherwise provided in these
rules, join as plaintiffs or be joined as defendants in one complaint,
where any question of law or fact common to all such plaintiffs or to
all such defendants may arise in the action; but the court may make
such orders as may be just to prevent any plaintiff or defendant
from being embarrassed or put to expense in connection with any
proceedings in which he may have no interest.
Petitioner has appealed by certiorari from the order of Judge Heilia
S. Mallare-Phillipps of the Regional Trial Court of Baguio City and
Benguet Province which dismissed his complaint for lack of
jurisdiction. Petitioner did not attach to his petition a copy of his
complaint in the erroneous belief that the entire original record of
the case shall be transmitted to this Court pursuant to the second
paragraph of Section 39 of BP129. This provision applies only to
ordinary appeals from the regional trial court to the Court of
Appeals (Section 20 of the Interim Rules). Appeals to this Court by
petition for review on certiorari are governed by Rule 45 of the Rules
of Court (Section 25 of the Interim Rules).
However, the order appealed from states that the first cause of
action alleged in the complaint was against respondent Ignacio
Binongcal for refusing to pay the amount of P11,643.00 representing
cost of truck tires which he purchased on credit from petitioner on
various occasions from August to October, 1981; and the second
cause of action was against respondent Fernando Calion for
allegedly refusing to pay the amount of P10,212.00 representing
cost of truck tires which he purchased on credit from petitioner on
several occasions from March, 1981 to January, 1982.
On December 15, 1983, counsel for respondent Binongcal filed a
Motion to Dismiss on the ground of lack of jurisdiction since the
amount of the demand against said respondent was only
P11,643.00, and under Section 19(8) of BP129 the regional trial
court shall exercise exclusive original jurisdiction if the amount of
the demand is more than twenty thousand pesos (P20,000.00). It
was further averred in said motion that although another person,
Fernando Calion, was allegedly indebted to petitioner in the amount
of P10,212.00, his obligation was separate and distinct from that of
the other respondent. At the hearing of said Motion to Dismiss,
counsel for respondent Calion joined in moving for the dismissal of
the complaint on the ground of lack of jurisdiction. Counsel for
petitioner opposed the Motion to Dismiss. As above stated, the trial
court dismissed the complaint for lack of jurisdiction.
Petitioner maintains that the lower court has jurisdiction over the
case following the "novel" totality rule introduced in Section 33(l) of
BP129 and Section 11 of the Interim Rules.
The pertinent portion of Section 33(l) of BP129 reads as follows:
... Provided,That where there are several claims or causes of action
between the same or different parties, embodied in the same
complaint, the amount of the demand shall be the totality of the
claims in all the causes of action, irrespective of whether the causes
of action arose out of the same or different transactions. ...
Section 11 of the Interim Rules provides thus:
Application of the totality rule.-In actions where the jurisdiction of
the court is dependent on the amount involved, the test of
jurisdiction shall be the aggregate sum of all the money demands,
exclusive only of interest and costs, irrespective of whether or not
the separate claims are owned by or due to different parties. If any
demand is for damages in a civil action, the amount thereof must be
specifically alleged.
Petitioner compares the above-quoted provisions with the pertinent
portion of the former rule under Section 88 of the Judiciary Act of
1948 as amended which reads as follows:
... Where there are several claims or causes of action between the
same parties embodied in the same complaint, the amount of the
demand shall be the totality of the demand in all the causes of
action, irrespective of whether the causes of action arose out of the
same or different transactions; but where the claims or causes of
action joined in a single complaint are separately owned by or due
to different parties, each separate claim shall furnish the
jurisdictional test. ...
and argues that with the deletion of the proviso in the former rule,
the totality rule was reduced to clarity and brevity and the
jurisdictional test is the totality of the claims in all, not in each, of
the causes of action, irrespective of whether the causes of action
arose out of the same or different transactions.
This argument is partly correct. There is no difference between the
former and present rules in cases where a plaintiff sues a defendant
on two or more separate causes of action. In such cases, the amount
of the demand shall be the totality of the claims in all the causes of
action irrespective of whether the causes of action arose out of the
same or different transactions. If the total demand exceeds twenty
thousand pesos, then the regional trial court has jurisdiction.
Needless to state, if the causes of action are separate and
independent, their joinder in one complaint is permissive and not
mandatory, and any cause of action where the amount of the
demand is twenty thousand pesos or less may be the subject of a
separate complaint filed with a metropolitan or municipal trial court.
On the other hand, there is a difference between the former and
present rules in cases where two or more plaintiffs having separate
causes of action against a defendant join in a single complaint.
Under the former rule, "where the claims or causes of action joined
in a single complaint are separately owned by or due to different
parties, each separate claim shall furnish the jurisdictional test"
(Section 88 of the Judiciary Act of 1948 as amended, supra). This was
based on the ruling in the case of Vda. de Rosario vs. Justice of the
Peace, 99 Phil. 693. As worded, the former rule applied only to cases
of permissive joinder of parties plaintiff. However, it was also
applicable to cases of permissive joinder of parties defendant, as
may be deduced from the ruling in the case of Brillo vs. Buklatan,
thus:
Furthermore, the first cause of action is composed of separate
claims against several defendants of different amounts each of
which is not more than P2,000 and falls under the jurisdiction of the
justice of the peace court under section 88 of Republic Act No, 296.
The several claims do not seem to arise from the same transaction
or series of transactions and there seem to be no questions of law or
of fact common to all the defendants as may warrant their joinder
under Rule 3, section 6. Therefore, if new complaints are to be filed
in the name of the real party in interest they should be filed in the
justice of the peace court. (87 Phil. 519, 520, reiterated in Gacula vs.
Martinez, 88 Phil. 142, 146)
Under the present law, the totality rule is applied also to cases
where two or more plaintiffs having separate causes of action
against a defendant join in a single complaint, as well as to cases
where a plaintiff has separate causes of action against two or more
defendants joined in a single complaint. However, the causes of
action in favor of the two or more plaintiffs or against the two or
more defendants should arise out of the same transaction or series
of transactions and there should be a common question of law or
fact, as provided in Section 6 of Rule 3.
43
The difference between the former and present rules in cases of
permissive joinder of parties may be illustrated by the two cases
which were cited in the case of Vda. de Rosario vs. Justice of the
Peace (supra) as exceptions to the totality rule. In the case of
Soriano y Cia vs. Jose (86 Phil. 523), where twenty-nine dismissed
employees joined in a complaint against the defendant to collect
their respective claims, each of which was within the jurisdiction of
the municipal court although the total exceeded the jurisdictional
amount, this Court held that under the law then the municipal court
had jurisdiction. In said case, although the plaintiffs' demands were
separate, distinct and independent of one another, their joint suit
was authorized under Section 6 of Rule 3 and each separate claim
furnished the jurisdictional test. In the case of International Colleges,
Inc. vs. Argonza (90 Phil. 470), where twenty-five dismissed teachers
jointly sued the defendant for unpaid salaries, this Court also held
that the municipal court had jurisdiction because the amount of
each claim was within, although the total exceeded, its jurisdiction
and it was a case of permissive joinder of parties plaintiff under
Section 6 of Rule 3.

Under the present law, the two cases above cited (assuming they do
not fall under the Labor Code) would be under the jurisdiction of the
regional trial court. Similarly, in the abovecited cases of Brillo vs.
Buklatan and Gacula vs. Martinez (supra), if the separate claims
against the several defendants arose out of the same transaction or
series of transactions and there is a common question of law or fact,
they would now be under the jurisdiction of the regional trial court.

In other words, in cases of permissive joinder of parties, whether as

plaintiffs or as defendants, under Section 6 of Rule 3, the total of all
the claims shall now furnish the jurisdictional test. Needless to state
also, if instead of joining or being joined in one complaint separate
actions are filed by or against the parties, the amount demanded in
each complaint shall furnish the jurisdictional test.

In the case at bar, the lower court correctly held that the
jurisdictional test is subject to the rules on joinder of parties
pursuant to Section 5 of Rule 2 and Section 6 of Rule 3 of the Rules
of Court and that, after a careful scrutiny of the complaint, it
appears that there is a misjoinder of parties for the reason that the
claims against respondents Binongcal and Calion are separate and
distinct and neither of which falls within its jurisdiction.

WHEREFORE, the order appealed from is affirmed, without

pronouncement as to costs.

SO ORDERED.

44