II.

RULES 1 TO 5

Case #: 1
By: Capurcos, Jumel L.

EVANGELINE ALDAY vs. FGU INSURANCE CORPORATION

[G.R. No. 138822. January 23, 2001]

Doctrine: Remedial Law; Civil Procedure; Estoppel by laches arises from the negligence or omission to assert a right
within a reasonable time, warranting a presumption that the party entitled to assert it either has abandoned or declined to
assert it

Facts:

FGU Insurance Corporation filed a complaint with the RTC of Makati alleging that Alday owed it P114,650.76,
representing unliquidated cash advances, unremitted costs of premiums and other charges incurred as an insurance
agent. Respondent also prayed for exemplary damages, attorneys fees, and costs of suit. Petitioner filed her answer and
by way of counterclaim, asserted her right for the payment of P104,893.45, representing direct commissions, profit
commissions and contingent bonuses and for accumulated premium reserves amounting to P500,000.00. In addition,
petitioner prayed for attorneys fees, litigation expenses, moral damages and exemplary damages for the allegedly
unfounded action filed by respondent.

Respondent filed a Motion to Strike Out Answer With Compulsory Counterclaim And To Declare Defendant In Default
because petitioners answer was allegedly filed out of time. However, the trial court denied the motion. A few weeks later,
respondent filed a motion to dismiss petitioners counterclaim, contending that the trial court never acquired jurisdiction
over the same because of the non-payment of docket fees by petitioner. In response, petitioner asked the trial court to
declare her counterclaim as exempt from payment of docket fees since it is compulsory and that respondent be declared
in default for having failed to answer such counterclaim.

The trial court granted the motion to dismiss. The court found petitioners counterclaim to be merely permissive and held
that petitioners failure to pay docket fees prevented the court from acquiring jurisdiction over the same. The Court of
Appeals sustained the trial court.

Issues:

Whether or not the respondent is estopped from questioning her non-payment of docket fees because it did not raise
this particular issue when it filed its first motion.

Held:

Estoppel by laches arises from the negligence or omission to assert a right within a reasonable time, warranting a
presumption that the party entitled to assert it either has abandoned or declined to assert it. In the case at bar,
respondent cannot be considered as estopped from assailing the trial court’s jurisdiction over petitioners counterclaim
since this issue was raised by respondent with the trial court itself the body where the action is pending - even before
the presentation of any evidence by the parties and definitely, way before any judgment could be rendered by the trial
court.

This objection to the CA’s jurisdiction is raised for the first time before this Court. Although the lack of jurisdiction of a
court may be raised at any stage of the action, a party may be estopped from raising such questions if he has actively
taken part in the very proceedings which he questions, belatedly objecting to the court’s jurisdiction in the event that
that the judgment or order subsequently rendered is adverse to him. In this case, respondent actively took part in the
proceedings before the CA by filing its appellees brief with the same. Its participation, when taken together with its
failure to object to the jurisdiction during the entire duration of the proceedings before such court, demonstrates a
willingness to abide by the resolution of the case by such tribunal and accordingly, respondent is now most decidedly
estopped.
Case #: 2
By: Cuanan, Jodelle Chris G.

KOREA TECHNOLOGIES CO., LTD. v. LERMA

G.R. No. 143581, January 7, 2008

DOCTRINE:
Foreign arbitral awards; subject to Judicial Review. - While the RTC does not have jurisdiction over disputes
governed by arbitration mutually agreed upon by the parties, still the foreign arbitral award is subject to judicial review by
the RTC which can set aside, reject, or vacate it. In this sense, what this Court held in Chung Fu Industries (Phils.), Inc.
relied upon by KOGIES is applicable insofar as the foreign arbitral awards, while final and binding, do not oust courts of
jurisdiction since these arbitral awards are not absolute and without exceptions as they are still judicially reviewable.
Chapter 7 of RA 9285 has made it clear that all arbitral awards, whether domestic or foreign, are subject to judicial review
on specific grounds provided for. Petitioner is correct in its contention that an arbitration clause, stipulating that the arbitral
award is final and binding, does not oust our courts of jurisdiction as the international arbitral award, the award of which is
not absolute and without exceptions, is still judicially reviewable under certain conditions provided for by the UNCITRAL
Model Law on ICA as applied and incorporated in RA 9285.

FACTS:

Petitioner Korea Technologies Co., Ltd. (KOGIES) is a Korean corporation which is engaged in the supply and installation
of Liquefied Petroleum Gas (LPG) Cylinder manufacturing plants, while private respondent Pacific General Steel
Manufacturing Corp. (PGSMC) is a domestic corporation.

On March 5, 1997, PGSMC and KOGIES executed a Contract whereby KOGIES would set up an LPG Cylinder
Manufacturing Plant in Carmona, Cavite. The contract was executed in the Philippines. On April 7, 1997, the parties
executed, in Korea, an Amendment for Contract No. KLP-970301 dated March 5, 1997 amending the terms of payment.
The contract and its amendment stipulated that KOGIES will ship the machinery and facilities necessary for manufacturing
LPG cylinders for which PGSMC would pay USD 1,224,000. KOGIES would install and initiate the operation of the plant
for which PGSMC bound itself to pay USD 306,000 upon the plant’s production of the 11-kg. LPG cylinder samples. Thus,
the total contract price amounted to USD 1,530,000.

On October 14, 1997, PGSMC entered into a Contract of Lease with Worth Properties, Inc. (Worth) for use of Worth’s
5,079-square meter property with a 4,032-square meter warehouse building to house the LPG manufacturing plant. The
monthly rental was PhP 322,560 commencing on January 1, 1998 with a 10% annual increment clause. Subsequently,
the machineries, equipment, and facilities for the manufacture of LPG cylinders were shipped, delivered, and installed in
the Carmona plant. PGSMC paid KOGIES USD 1,224,000.

However, gleaned from the Certificate executed by the parties on January 22, 1998, after the installation of the plant, the
initial operation could not be conducted as PGSMC encountered financial difficulties affecting the supply of materials, thus
forcing the parties to agree that KOGIES would be deemed to have completely complied with the terms and conditions of
the March 5, 1997 contract.

For the remaining balance of USD306,000 for the installation and initial operation of the plant, PGSMC issued two
postdated checks. When KOGIES deposited the checks, these were dishonored for the reason "PAYMENT STOPPED."
PGSMC’S contentions were KOGIES deliver a different brand of hydraulic press from that agreed upon and it had not
delivered several equipment parts already paid for. PGSMC replied that the two checks it issued KOGIES were fully
funded but the payments were stopped for reasons previously made known to KOGIES.

On June 1, 1998, PGSMC informed KOGIES that PGSMC was canceling their Contract on the ground that KOGIES had
altered the quantity and lowered the quality of the machineries and equipment it delivered to PGSMC, and that PGSMC
would dismantle and transfer the machineries, equipment, and facilities installed in the Carmona plant. Five days later,
PGSMC a complaint for estafa against Mr. Dae Hyun Kang, President of KOGIES.

On June 15, 1998, KOGIES wrote PGSMC informing the latter that PGSMC could not unilaterally rescind their contract
nor dismantle and transfer the machineries and equipment on mere imagined violations by KOGIES. It also insisted that
their disputes should be settled by arbitration as agreed upon in Article 15, the arbitration clause of their contract. On July
1, 1998, KOGIES instituted an Application for Arbitration before the Korean Commercial Arbitration Board (KCAB) in
Seoul, Korea pursuant to Art. 15 of the Contract as amended.
On July 23, 1998, the RTC issued an Order denying the application for a writ of preliminary injunction, reasoning that
PGSMC had paid KOGIES USD 1,224,000, the value of the machineries and equipment as shown in the contract such
that KOGIES no longer had proprietary rights over them. And that Art. 15 of the Contract as amended was invalid as it
tended to oust the trial court or any other court jurisdiction over any dispute that may arise between the parties. KOGIES’
prayer for an injunctive writ was denied.

PGSMC filed a Motion for Inspection of Things to determine whether there was indeed alteration of the quantity and
lowering of quality of the machineries and equipment, and whether these were properly installed. KOGIES opposed the
motion positing that the queries and issues raised in the motion for inspection fell under the coverage of the arbitration
clause in their contract.

The trial court issued an Order (1) granting PGSMC’s motion for inspection; (2) denying KOGIES’ motion for
reconsideration; and (3) denying KOGIES’ motion to dismiss. KOGIES filed an Urgent Motion for Reconsideration. Ten
days after, without waiting for the resolution of its October 2, 1998 urgent motion for reconsideration, KOGIES filed before
the Court of Appeals (CA) a petition for certiorari.

CA affirmed the RTC Orders and dismissing the petition for certiorari filed by KOGIES. CA found that the RTC did not
gravely abuse its discretion in issuing the assailed Orders. Moreover, the CA reasoned that KOGIES’ contention that the
total contract price for USD 1,530,000 was for the whole plant and had not been fully paid was contrary to the finding of
the RTC that PGSMC fully paid the price of USD 1,224,000, which was for all the machineries and equipment. According
to the CA, this determination by the RTC was a factual finding beyond the ambit of a petition for certiorari.

On the issue of the validity of the arbitration clause, the CA agreed with the lower court that an arbitration clause which
provided for a final determination of the legal rights of the parties to the contract by arbitration was against public policy.

Furthermore, the CA held that the petition for certiorari had been filed prematurely since KOGIES did not wait for the
resolution of its urgent motion for reconsideration of the RTC Order which was the plain, speedy, and adequate remedy
available. Hence, this Petition for Review on Certiorari under Rule 45.

ISSUE:

Whether or not the arbitration clause stated in Article 15 of the contract is to be deemed null and void?

HELD:

No. Established in this jurisdiction is the rule that the law of the place where the contract is made governs. Lex loci
contractus. The contract in this case was perfected here in the Philippines. Therefore, our laws ought to govern.
Nonetheless, Art. 2044 of the Civil Code sanctions the validity of mutually agreed arbitral clause or the finality and binding
effect of an arbitral award. Art. 2044 provides, "Any stipulation that the arbitrators’ award or decision shall be final, is valid,
without prejudice to Articles 2038, 2039 and 2040.

The arbitration clause was mutually and voluntarily agreed upon by the parties. It has not been shown to be contrary to
any law, or against morals, good customs, public order, or public policy. There has been no showing that the parties have
not dealt with each other on equal footing. We find no reason why the arbitration clause should not be respected and
complied with by both parties

The arbitration clause which stipulates that the arbitration must be done in Seoul, Korea in accordance with the
Commercial Arbitration Rules of the KCAB, and that the arbitral award is final and binding, is not contrary to public policy.

Petitioner is correct in its contention that an arbitration clause, stipulating that the arbitral award is final and binding, does
not oust our courts of jurisdiction as the international arbitral award, the award of which is not absolute and without
exceptions, is still judicially reviewable under certain conditions provided for by the UNCITRAL Model Law on ICA as
applied and incorporated in RA 9285.

Finally, the RTC has jurisdiction to review foreign arbitral awards. Sec. 42 in relation to Sec. 45 of RA 9285 designated
and vested the RTC with specific authority and jurisdiction to set aside, reject, or vacate a foreign arbitral award on
grounds provided under Art. 34(2) of the UNCITRAL Model Law.
Case #: 3
By: Evangelista, Jellary

Mercado v. Court of Appeals

[G.R. No. L-14342, May 30, 1960]

Doctrine:

Civil Procedure. Cause of Action- In law mental anguish is restricted, as a rule, to such mental pain or suffering as
arises from an injury or wrong to the person himself, as distinguished from that form of mental suffering which is the
accompaniment of sympathy or sorrow for another's suffering of which arises from a contemplation of wrong committed on
the person of another. Pursuant to the rule stated, a husband or wife cannot recover for mental suffering caused by his or
her sympathy for the other's suffering. Nor can a parent recover for mental distress and anxiety on account of physical
injury sustained by a child or for anxiety for the safety of his child placed in peril by the negligence of another

Facts:

The pitogo owned by Augusto Mercado which is the son of the petitioner lent it to Benedicto Lim and lent it to Renato
Legaspi not knowing who really owned the pitogo then Augusto attempted to get back the pitogo from Renato but he was
stopped by Manuel Jr because of that he aggressively pushed him then the fight started which leads to Augusto being
angered attack Manuel Jr. and when Manuel Jr. is helpless he cut him on the right check with a piece of razor.

Issue:

Whether or not the petitioner is liable to pay for moral damages caused by his son and attorney’s fees

Held:

No. In their cause of action who prays for P5,000.00 covering the moral damages they allegedly suffered due to their
son's being wounded; and the sum of P3,000.00 as attorney's fees. "In law mental anguish is restricted, as a rule, to such
mental pain or suffering as arises from an injury or wrong to the person himself, as distinguished from that form of mental
suffering which is the accompaniment of sympathy or sorrow for another's suffering of which arises from a contemplation
of wrong committed on the person of another. Pursuant to the rule stated, a husband or wife cannot recover for mental
suffering caused by his or her sympathy for the other's suffering. Nor can a parent recover for mental distress and anxiety
on account of physical injury sustained by a child or for anxiety for the safety of his child placed in peril by the negligence
of another" (15 Am. Jur. 597) wherein the plaintiffs are not entitled to attorney’s fees. For the said moral damages, it is
excessive since it was in the course of an ordinary or common fight between the boys in a grade school and the wound
did not even require hospitalization nor Mercado was found guilty of any offense that it was excessive so the court exempt
the petitioner from the payment of moral damages.
Case #: 4
By: Ebajan, Jennelyn

PROTON PILIPINAS CORPORATION et al. v. BANQUE NATIONALE DE PARIS

DOCTRINE:

Commencement. Section 5. Rules of court. - 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.

FACTS:

Petitioner Proton Pilipinas Corporation (Proton) availed credit facilities of respondent Banque Nationale De Paris (BNP). In
order to assure payment, co-petitioners Automotive Corporation, Asea One Corporation and Autocorp Group executed a
corporate guarantee.

Proton failed to comply with his obligation to BNP. Thereafter, BNP demanded the payment of Proton‘s obligation to its
co-petitioners pursuant to corporate guarantee. But the same remained unheeded. BNP then filed a complaint with the
Regional Trial Court (RTC) against Proton et al. The clerk of court assessed the docket fee. Proton et al. filed a Motion to
Dismiss on the ground that the court cannot exercise jurisdiction over the case because BNP did not properly pay the
docket fees. The RTC denied the motion to dismiss. On appeal, the Court of Appeals denied the motion of Proton et al.
Hence this present petition.

ISSUE:

Whether or not the court does not acquire jurisdiction when there is an improper payment of docket fees

HELD:

The Court rules that it is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the
prescribed docket fee that vests a trial court with jurisdiction over the subject-matter or nature of the action. 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. It also stated that
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 therefore 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.

In the case at bar, BNP merely relied on the assessment made by the clerk of court which turned out to be incorrect.
Under the circumstances, the clerk of court has the responsibility of reassessing what respondent must pay within the
prescriptive period, failing which the complaint merits dismissal.
Case #: 5
By: Gaw, Jennifer Anne P.

RUBY SHELTER BUILDERS REALTY DEVELOPMENT CORPORATION vs. HON. PABLO FORMARAN III
G.R No. 175914, February 10, 2009

DOCTRINE
Remedial Law; Actions; Docket Fees; Jurisdiction; Court acquires jurisdiction over any case only upon payment of the
prescribed docket fee; Payment of the docket fee is not only mandatory, but also jurisdictional.
Same; Same; Same; Same; Docket fee under Section 7(a), Rule 141, in cases involving real property depend on the fair
market value of the same; Section 7(b)(1), Rule 141 imposes a fixed or flat rate of docket fees on actions incapable of
pecuniary estimation. ---- The docket fees under Section 7(a), Rule 141, in cases involving real property, the higher the
docket fees due. In contrast, Section 7(b)(1), Rule 141 imposes a fixed or flat rate of docket fees on actions incapable of
pecuniary estimation.
Same; Same; Same; In computing the docket fees for cases involving real properties, the courts, instead of relying on the
assessed or estimated value, would now be using the fair market value of the real properties (as stated in the Tax
Declaration or the Zonal Valuation of the Bureau of Internal Revenue, whichever is higher) or, in the absence thereof, the
value of the same. ---- A real action indisputably involves real property. The docket fees for a real action would still be
determined in accordance with the value of the real property involved therein; the only difference is in what constitutes the
acceptable value.

FACTS:

Petitioner obtained a loan in the total amount of P95,700,620.00 from respondents Romeo Y. Tan (Tan) and Roberto L.
Obiedo (Obiedo), secured by real estate mortgages over five parcels of land, all located in Triangulo, Naga City, covered
by Transfer Certificates of Title (TCTs) issued by the Registry of Deeds for Naga City, in the name of petitioner. When
petitioner was unable to pay the loan when it became due and demandable, respondents Tan and Obiedo agreed to an
extension of the same.

In a Memorandum of Agreement dated 17 March 2005, respondents Tan and Obiedo granted petitioner until 31
December 2005 to settle its indebtedness, and condoned the interests, penalties and surcharges accruing thereon from 1
October 2004 to 31 December 2005 which amounted to P74,678,647.00. The Memorandum of Agreement required, in
turn, that petitioner execute simultaneously with the said Memorandum, by way of dacion en pago, Deeds of Absolute
Sale in favor of respondents Tan and Obiedo, covering the same parcels of land subject of the mortgages.

In the event that petitioner is able to redeem any of the afore-mentioned parcels of land, the Deed of Absolute Sale
covering the said property shall be nullified and have no force and effect; and respondents Tan and Obiedo shall then
return the owners duplicate of the corresponding TCT to petitioner and also execute a Deed of Discharge of
Mortgage. However, if petitioner is unable to redeem the parcels of land within the period agreed upon, respondents Tan
and Obiedo could already present the Deeds of Absolute Sale covering the same to the Office of the Register of Deeds
for Naga City so respondents Tan and Obiedo could acquire TCTs to the said properties in their names.

The Memorandum of Agreement further provided that should petitioner contest, judicially or otherwise, any act,
transaction, or event related to or necessarily connected with the said Memorandum and the Deeds of Absolute Sale
involving the five parcels of land, it would pay respondents Tan and Obiedo P10,000,000.00 as liquidated damages
inclusive of costs and attorneys fees. Petitioner would likewise pay respondents Tan and Obiedo the condoned interests,
surcharges and penalties Finally, should a contest arise from the Memorandum of Agreement, Mr. Ruben Sia (Sia),
President of petitioner corporation, personally assumes, jointly and severally with petitioner, the latters monetary
obligation to respondent Tan and Obiedo.

Pursuant to the Memorandum of Agreement, petitioner, represented by Mr. Sia, executed separate Deeds of Absolute
Sale, over the five parcels of land, in favor of respondents Tan and Obiedo. On the blank spaces provided for in the said
Deeds, somebody wrote the 3rd of January 2006 as the date of their execution. The Deeds were again notarized by
respondent Atty. Reyes also on 3 January 2006.

Without payment having been made by petitioner on 31 December 2005, respondents Tan and Obiedo presented the
Deeds of Absolute Sale dated 3 January 2006 before the Register of Deeds of Naga City on 8 March 2006, as a result of
which, they were able to secure TCTs over the five parcels of land in their names.
On 16 March 2006, petitioner filed before the RTC a Complaint against respondents Tan, Obiedo, and Atty. Reyes, for
declaration of nullity of deeds of sales and damages, with prayer for the issuance of a writ of preliminary injunction and/or
temporary restraining order (TRO).

CA upheld RTC, saying that the objectives of RSB in filing the complaint were to cancel the deeds of sale and ultimately,
to recover possession of the same. It is therefore a real action. Consequently, the additional docket fees that must be paid
cannot be assessed in accordance with Section 7(b). As a real action, Section 7(a) must be applied in the assessment
and payment of the proper docket fee.

ISSUES:

For the purposes of paying the correct amount of docket fees, whether the annulment of deed of sale involving a real
property is incapable of pecuniary estimation.

HELD:
A real action indisputably involves real property. The docket fees for a real action would still be determined in accordance
with the value of the real property involved therein; the only difference is in what constitutes the acceptable value.

In computing the docket fees for cases involving real properties, the courts, instead of relying on the assessed or
estimated value, would now be using the fair market value of the real properties (as stated in the Tax Declaration or the
Zonal Valuation of the Bureau of Internal Revenue, whichever is higher) or, in the absence thereof, the stated value of the
same.

It is also important to note that, with the amendments introduced by A.M. No. 04-2-04-SC, which became effective on 16
August 2004, the paragraph in Section 7, Rule 141 of the Rules of Court, pertaining specifically to the basis for
computation of docket fees for real actions was deleted. Instead, Section 7(1) of Rule 141, as amended, provides that in
cases involving real property, the FAIR MARKET value of the REAL property in litigation STATED IN THE CURRENT
TAX DECLARATION OR CURRENT ZONAL VALUATION OF THE BUREAU OF INTERNAL REVENUE, WHICH IS
HIGHER, OR IF THERE IS NONE, THE STATED VALUE OF THE PROPERTY IN LITIGATION shall be the basis for the
computation of the docket fees.

In sum, the Court finds that the true nature of the action instituted by petitioner against respondents is the recovery of title
to and possession of real property. It is a real action necessarily involving real property, the docket fees for which must be
computed in accordance with Section 7(1), Rule 141 of the Rules of Court, as amended. The Court of Appeals, therefore,
did not commit any error in affirming the RTC Orders requiring petitioner to pay additional docket fees for its Complaint in
Civil Case No. 2006-0030.

The Court does not give much credence to the allegation of petitioner that if the judgment of the Court of Appeals is
allowed to stand and not rectified, it would result in grave injustice and irreparable injury to petitioner in view of the
prohibitive amount assessed against it. It is a sweeping assertion which lacks evidentiary support. Undeniably, before the
Court can conclude that the amount of docket fees is indeed prohibitive for a party, it would have to look into the financial
capacity of said party. It baffles this Court that herein petitioner, having the capacity to enter into multi-million transactions,
now stalls at paying P720,392.60 additional docket fees so it could champion before the courts its rights over the disputed
real properties. Moreover, even though the Court exempts individuals, as indigent or pauper litigants, from paying docket
fees, it has never extended such an exemption to a corporate entity.

Petition is DENIED
Case #: 6
By: Lasala, Shantee

ST. LOUIS UNIVERSITY, INC., petitioner, vs. EVANGELINE C. COBARRUBIAS, respondent.

G.R. No. 187104. August 03, 2010

Doctrine:
Appeal is not a natural right but a mere statutory privilege, thus, appeal must be made strictly in accordance with the
provision set by law. Rule 43 of the Rules of Court provides that appeals from the judgment of the VA shall be taken to
the CA, by filing a petition for review within fifteen (15) days from the receipt of the notice of judgment. Furthermore, upon
the filing of the petition, the petitioner shall pay to the CA clerk of court the docketing and other lawful fees; non-
compliance with the procedural requirements shall be a sufficient ground for the petition’s dismissal. Thus, payment in full
of docket fees within the prescribed period is not only mandatory, but also jurisdictional. It is an essential requirement,
without which, the decision appealed from would become final and executory as if no appeal has been filed.

FACTS:

Respondent is an associate professor of the petitioner and an active member of the union of faculty and employees. The
Collective Bargaining Agreements contained the following provision that for teaching employees in college who fail the
yearly evaluation, who are retained for three (3) cumulative years in five (5) years, shall be on forced leave for one (1)
regular semester during which period all benefits due them shall be suspended. Petitioner placed respondent on forced
leave for failing to achieve the required rating points. Respondent sought recourse from the CBA’s grievance machinery,
but to no avail. Respondent filed a case with DOLE but circulation and mediation again failed. The parties submitted the
issues between them for voluntary arbitration before Voluntary Arbitrator (VA). Respondent argued that the CA already
resolved the forced leave issue in a prior case between the parties, ruling that the forced leave for teachers who fail their
evaluation for three (3) times within a five-year period should be coterminous with the CBA in force during the same five-
year period. Petitioner argued that said CA decision is not yet final. The VA dismissed the complaint. Respondent filed
with the CA a petition for review under Rule 43 of the Rules of Court but failed to pay the filing fees and to attach the
material portion of the records. Motion for reconsideration was filed, complying with the procedural lapses, and CA
reinstated the petition.

ISSUES:

Whether or not the Court of Appeals erred in reinstating respondent’s petition despite her failure to appeal (docket) fee
within the reglementary period.

HELD:

Yes. The CA erred in its ruling. Appeal is not a natural right but a mere statutory privilege, thus, appeal must be made
strictly in accordance with the provision set by law. Rule 43 of the Rules of Court provides that appeals from the judgment
of the VA shall be taken to the CA, by filing a petition for review within fifteen (15) days from the receipt of the notice of
judgment. Furthermore, upon the filing of the petition, the petitioner shall pay to the CA clerk of court the docketing and
other lawful fees; non-compliance with the procedural requirements shall be a sufficient ground for the petition’s dismissal.
Thus, payment in full of docket fees within the prescribed period is not only mandatory, but also jurisdictional. It is an
essential requirement, without which, the decision appealed from would become final and executory as if no appeal has
been filed. Here, the docket fees were paid late, and without payment of the full docket fees, Cobarrubias’ appeal was not
perfected within the reglementary period.
There are, however, recognized exceptions to their strict observance, such as: (1) most persuasive and weighty reasons;
(2) to relieve a litigant from an injustice not commensurate with his failure to comply with the prescribed procedure; (3)
good faith of the defaulting party by immediately paying within a reasonable time from the time of the default; (4) the
existence of special or compelling circumstances; (5) the merits of the case; (6) a cause not entirely attributable to the
fault or negligence of the party favored by the suspension of the rules; (7) a lack of any showing that the review sought is
merely frivolous and dilatory; (8) the other party will not be unjustly prejudiced thereby; (9) fraud, accident, mistake or
excusable negligence without the appellant’s fault; (10) peculiar, legal and equitable circumstances attendant to each
case; (11) in the name of substantial justice and fair play; (12) importance of the issues involved; and (13) exercise of
sound discretion by the judge, guided by all the attendant circumstances. Thus, there should be an effort, on the part of
the party invoking liberality, to advance a reasonable or meritorious explanation for his/her failure to comply with the rules.
Case #: 7
By: Lim, Anton Kristoffer M.

Gipa et al vs. South Luzon Institute

G.R. No.177425 June 18, 2014

DOCTRINE:
Civil Procedure. Action. Commencement. – Payment of the full amount of appellate court docket and lawful fees is
mandatory and jurisdictional. An ordinary appeal from a decision or final order of the RTC to the CA must be made within
15 days from notice. And within this period, the full amount of the appellate court docket and other lawful fees must be
paid to the clerk of the court which rendered the judgment or final order appealed from. The payment of docket fees within
the prescribed period is mandatory for the perfection of an appeal. Without such payment, the appeal is not perfected.
The appellate court does not acquire jurisdiction over the subject matter of the action and the Decision sought to be
appealed from becomes final and executory.

FACTS:
Respondent Southern Luzon Institute (SLI) filed a Complaint for Recovery of Ownership and Possession with Damages
against petitioners Gipa et al. SLI sought that petitioners be ordered to immediately vacate the premises but petitioners
did not heed SLI’s demand as they believed that they have the right to stay on the said property.

RTC rendered a decision in favor of SLI due to the weight to SLI’s documentary evidence showing the grant of its
Miscellaneous Sales Application which became the basis for the issuance of title under its name, and the testimony of the
Supervising Draftsman of the National Housing Authority.

Petitioners appealed but were dismissed by CA for failure to pay the appellate court docket fees and other lawful fees.
Petitioners filed an MR which was granted by CA but further required to remit within ten days from notice the amount
of P30.00 for legal research fund. Despite the lapse of nine months from receipt of the said resolution, petitioners failed to
comply with the CA’s directive. Hence, the said court dismissed the appeal.

ISSUE:

W/N CA erred in dismissing the appeal on the ground that the petitioner failed to remit the amount of P30.00?

HELD:
No. the Petition for Review on Certiorari is DENIED. The assailed Resolutions of the CA are AFFIRMED.
The Court explained that “payment of the full amount of appellate court docket and lawful fees is mandatory and
jurisdictional. An ordinary appeal from a decision or final order of the RTC to the CA must be made within 15 days from
notice. And within this period, the full amount of the appellate court docket and other lawful fees must be paid to the clerk
of the court which rendered the judgment or final order appealed from. The payment of docket fees within the prescribed
period is mandatory for the perfection of an appeal. Without such payment, the appeal is not perfected.

The appellate court does not acquire jurisdiction over the subject matter of the action and the Decision sought to be
appealed from becomes final and executory.”

Here, while petitioners paid a substantial part of the docket fees, they still failed to pay the full amount thereof since their
payment was short of P30.00.Based on the premise that the questioned Decision of the RTC has already become final
and executory due to non-perfection of the appeal.
Case #: 8
By: Maranan, Lady Grace

RODGING REYES, Petitioner, v. PEOPLE OF THE PHILIPPINES AND SALUD M. GEGATO, Respondents.
G.R. No. 193034, July 20, 2015

DOCTRINE:
 Immutability of Judgment espouses that a judgment that has acquired finality becomes immutable and
unalterable, and may no longer be modified in any respect even if the modification is meant to correct erroneous
conclusions of fact or law and whether it will be made by the court that rendered it or by the highest court of the
land.

 A party may not institute more than one suit for a single cause of action. (Section 3, Rule 2, Rules of Civil
Procedure)

FACTS:

Petitioner, in a complaint filed by private respondent Salud M. Gegato, was charged with Grave Threats before the
Municipal Circuit Trial Court (MCTC) of Bayugan and Sibagat, Bayugan, Agusan del Sur.
The MCTC, in a Decision dated August 10, 2005, found petitioner guilty beyond reasonable doubt of the crime charged.
On appeal, the Regional Trial Court, in its Decision dated April 2, 2007, denied petitioner's appeal but found petitioner
guilty beyond reasonable doubt of the crime of Other Light Threats under Article 285, par. 2 of the Revised Penal Code,
instead of Grave Threats as originally adjudged by the MCTC.
Petitioner filed a Motion for Reconsideration, and in its Amended Decision 7 dated May 16, 2007, the RTC denied the
motion and modified its original decision reducing the amount of moral damages to P10, 000.00 and the attorney’s fees to
P10,000.00.
Thus, petitioner filed with the Court of Appeals a Motion for Extension of Time to File a Petition for Review. However,
instead of filing a petition for review within the 15-day period allowed by the CA, petitioner filed a second Motion for
Extension of Time asking for another 15 days within which to file his petition for review. After which, petitioner filed his
petition. Thereafter, the CA, in its Resolution dated August 2, 2007, dismissed the petition.
Petitioner filed three (3) successive Motions for Reconsideration before the CA on August 14, 2007, November 13, 2008,
and December 28, 2009.
In its Resolution dated November 23, 2009, the CA granted the petitioner's second Motion for Reconsideration setting
aside its previous Resolution dated October 17, 2008 and dismissing the first Motion for Reconsideration dated August
13, 2007. The CA, in the same Resolution, discussed the other grounds for the dismissal of the petition as contained in its
first Resolution dated August 2, 2007. Thus, the CA not only denied the first Motion for Reconsideration dated August 13,
2007 but also dismissed the Petition for Review filed earlier.
However, as keenly pointed out by the OSG in its Comment dated January 11, 2011, instead of elevating the present
case before this Court within the period provided under Rule 45 of the Rules of Court, petitioner opted to file a third motion
for reconsideration, which was filed without leave of court and notwithstanding the express declaration of the CA that
petitioner's first Motion for Reconsideration dated August 13, 2007 was denied and the case already dismissed with
finality.
At the outset, the Court emphasizes that second and subsequent motions for reconsideration are, as a general rule,
prohibited. Section 2, Rule 52 of the Rules of Court provides that "no second motion for reconsideration of a judgment or
final resolution by the same party shall be entertained." The rule rests on the basic tenet of immutability of judgments. "At
some point, a decision becomes final and executory and, consequently, all litigations must come to an end."

ISSUE:
Whether or not the Court of Appeals was correct in dismissing petitioner’s second and third Motion for Reconsideration

RULING:

Yes. The CA did not commit any error when it properly noted without action the petitioner's third motion for
reconsideration for being a prohibited pleading, as well as merely a reiteration of his arguments in his first motion for
reconsideration. Therefore, the said motion for reconsideration is a mere scrap of paper that does not deserve any
consideration and the filing of the same did not toll the running of the prescriptive period for filing a petition based on Rule
45.
It is significant to emphasize that the CA dismissed the petition due to the following procedural infirmities: (1) it was filed
beyond the reglemetary period; (2) petitioner failed to pay the complete docket fee; (3) the petition failed to indicate a
complete statement of material dates since petitioner did not mention in the body of the petition when he received the
RTC's Order dated May 16, 2007 denying his Motion for Reconsideration; and (4) petitioner failed to attach pertinent
documents material in the petition as no copy of the May 16, 2007 Amended Decision was attached to the petition.
Case #: 9
By: Mataac, Michael Zachary
Dynamic Builders vs. Presberto
G.R. No. 174202, April 07, 2015
Doctrine:

Remedial Law; Civil Procedure; Actions; Splitting Cause of Action; The splitting of cause of action “violate[s] the
policy against multiplicity of suits, whose primary objective [is] to avoid unduly burdening the dockets of the courts” – Rule
2, Section 3 of the Rules of Court provides that ‘[a] party may not institute more than one suit for a single cause of action.”
Moreover, Section 4 discusses the splitting of a single case of action in that “if two or more suits are constituted on the
basis of the same cause of action, the filing of one or more judgement upon the merits in any one is available as a groung
for the dismissal of the others” the splitting of a cause of action “violate[s] the policy against multiplicity of suits, whose
primary objective [is] to avoid unduly burdening the dockets of the courts.”

Same; Civil Procedure; Actions; Splitting Cause of Action; Republic Act (RA) No. 8975, even when read with
Presidential Decree (PD) No. 1818, does not sanction the spiltting of a casuse of action in order for a party to avial itself of
the ancillary remedy of a temporary restraining order (TRO) from the Supreme Court (SC) - There is nothing in Republic
Act No. 8975 or in Presidential Decree No. 1818 that allows the simultaneous availment of legal remedies before the
Regional Trial Court and this court. Republic Act No. 8975, even when read with Presidential Decree No. 1818, does not
sanction the splitting of a cause of action in order for a party to avail itself of the ancillary remedy of a temporary
restraining order form this court.

Petitioner’s reading of Republic Act No. 8975’s repealing clause, such that only this court can issue injunctive
relief, fails to persuade. This court has set limit on the prohibition found on Presidential Decree No. 1818 by explaining
that lower courts ae not prohibited from enjoining administrative acts when questions of law exist and the acts do not
involve administrative discretion in technical cases: Although Presidential Decree No. 1818 prohibits any court from
issuing injunctions on cases involving infrastructure projects, the prohibition extends only to the issuance of injunctions or
restraining orders against administrative acts in controversies involving facts or the exercise of discretion in technical
cases. On issues clearly outside this dimension and involving questions of law, this Court declared that courts could not
be prevented from exercising their power to restrain or prohibit administrative acts. In such cases, let the hammer fall and
let it fall hard.

Facts:

On December 28, 2005, the Municipality of Valladolid, Negros Occidental, through its Bids and Awards
Committee, published an invitation to bid for the construction of a 1,050-lineal-meter rubble concrete seawall along the
municipality's shoreline. This infrastructure venture is known as the "Construction Shoreline Protection. only the remaining
four (4) bidders "were considered during the opening of the bids. Project." On April 21, 2006, the Bids and Awards
Committee issued Resolution No. 7 affirming the award of contract to HLJ Construction and Enterprise for the
construction of the 1,050-lineal-meter Construction Shoreline Protection Project amounting to P31,922,420.37. On June 6,
2006, Dynamic Builders lodged a formal protest with the head of the procuring entity, Mayor Ricardo P. Presbitero, Jr.
(Mayor Presbitero), to set aside the Bids and Awards Committee decision declaring Dynamic Builders' bid as not
substantially responsive.

Petitioner argues that in Section 58, the "law conferring on the Supreme Court the sole jurisdiction to issue
temporary restraining orders and injunctions relating to Infrastructure Project of Government" refers to Republic Act No.
897533 in relation to Presidential Decree No. 1818. Petitioner then submits that "while R.A. No. 8975 appears to apply only
to national government infrastructure projects . . . the resulting amendment to P.D. No. 1818 (by virtue of Sections 3 and 9
of R.A. No. 8975) removing any restriction upon the Honorable Supreme Court to issue injunctive relief, would similarly
apply to the infrastructure projects . . . subject of, or covered by, P.D. No. 1818, which would include those infrastructure
projects undertaken for or by local governments." Public respondents agree that Republic Act No. 8975 only governs
national government projects but disagree insofar as petitioner's submission that since Republic Act No. 8975 amended
Presidential Decree No. 1818 by removing the restriction on this court to issue injunctive relief, it now covers local
government projects.

Issue:

Whether or not the Dynamic Builders violated the rules against the splitting of a cause of action.

Held:
 There is nothing in Republic Act No. 8975 or in Presidential Decree No. 1818 that allows the simultaneous
availment of legal remedies before the Regional Trial Court and this court. Republic Act No. 8975, even when read with
Presidential Decree No. 1818, does not sanction the splitting of a cause of action in order for a party to avail itself of the
ancillary remedy of a temporary restraining order form this court.

Petitioner’s reading of Republic Act No. 8975’s repealing clause, such that only this court can issue injunctive
relief, fails to persuade. This court has set limit on the prohibition found on Presidential Decree No. 1818 by explaining
that lower courts ae not prohibited from enjoining administrative acts when questions of law exist and the acts do not
involve administrative discretion in technical cases: Although Presidential Decree No. 1818 prohibits any court from
issuing injunctions on cases involving infrastructure projects, the prohibition extends only to the issuance of injunctions or
restraining orders against administrative acts in controversies involving facts or the exercise of discretion in technical
cases. On issues clearly outside this dimension and involving questions of law, this Court declared that courts could not
be prevented from exercising their power to restrain or prohibit administrative acts. In such cases, let the hammer fall and
let it fall hard.
Case #: 10
By: Matias, Michelle Dulce Candelaria

Imelda Relucio vs Angelina Mejia Lopez

G.R. No. 138497, January 16, 2002

Doctrine. Parties on Civil Actions. Real party-in-interest. Every action must be prosecuted or defended in the name of
the real party in interest (Sec2, Rule 3, Rules of Court). A real party in interest is one who stands to be benefited or
injured by the judgment of the suit.

FACTS

Private respondent Angelina Mejia Lopez (plaintiff below) filed a petition for “APPOINTMENT AS SOLE
ADMINISTRATRIX OF CONJUGAL PARTNERSHIP OF PROPERTIES, FORFEITURE, ETC.,” against defendant Alberto
Lopez and petitioner Imelda Relucio.

In the petition, private-respondent alleged that sometime in 1968, defendant Lopez, who is legally married to the
private respondent, abandoned the latter and their four legitimate children; that he arrogated unto himself full and
exclusive control and administration of the conjugal properties, spending and using the same for his sole gain and benefit
to the total exclusion of the private respondent and their four children; that defendant Lopez, after abandoning his family,
maintained an illicit relationship and cohabited with herein petitioner since 1976.

A Motion to Dismiss the Petition was filed by Relucio on the ground that Lopez has no cause of action against
her.

Respondent Judge denying petitioner Relucio’s Motion to Dismiss on the ground that she is impleaded as a
necessary or indispensable party because some of the subject properties are registered in her name and defendant
Lopez, or solely in her name.

Motion for Reconsideration was denied. The Court of Appeals likewise denied. Hence this petition.

ISSUE:

Whether petitioner’s inclusion as party defendant is essential in the proceedings for a complete adjudication of the
controversy.

HELD:

NO. Petitioner is not a real party in interest, nor necessary or indispensable one. A real party in interest is one who stands
to be benefited or injured by the judgment of the suit. To determine the real party in interest, the rule requires to review the
elements of a cause of action. The first cause of action is for judicial appointment of respondent as administratrix of the
conjugal partnership wherein petitioner is a complete stranger to this cause of action. On the second cause of action is
for an accounting of conjugal partnership “by respondent husband.”, the petitioner again has nothing to do with this action
since it arises from or is an incident of marriage between husband and wife, and again no cause of action can exist
against petitioner on this ground. At the third cause of action is for the forfeiture of the husband defendant share in
property co-owned by him and petitioner, but it does not involve the issue of validity of co-ownership, such cause of action
pertains to the husband defendant and not to the petitioner.

Hence, if petitioner is not a real party in interest, she cannot be an indispensable party. An indispensable party is one
without whom there can be no final determination of an action. Nor can petitioner be a necessary party in Special
Proceedings M-3630. A necessary party as one who is not indispensable but who ought to be joined as party if complete
relief is to be accorded those already parties, or for a complete determination or settlement of the claim subject of the
action.
Case #: 11
By: Mejica, John Paolo A.

De Castro vs. Court of Appeal

G.R. No. 115838. July 18, 2002

DOCTRINE:

Civil Procedure. Parties. Indispensable party. -An indispensable party is one whose interest will be affected by the
courts action in the litigation, and without whom no final determination of the case can be had. The joinder of
indispensable parties is mandatory and courts cannot proceed without their presence. Whenever it appears to the court in
the course of a proceeding that an indispensable party has not been joined, it is the duty of the court to stop the trial and
order the inclusion of such party.

FACTS:

Appellant De Castros were co-owners of four lots located at EDSA corner New York and Denver Streets in Cubao,
Quezon City. Appellee Francisco Artigo was authorized by appellants to act as real estate broker in the sale of these
properties for the amount of P23,000,000.00, five percent (5%) of which will be given to the agent as commission.
Appellee received from appellants P48,893.76 as commission.

Appellee apparently felt short changed because according to him, his total commission should be P352,500.00 which is
five percent (5%) of the agreed price of P7,050,000.00 paid by Times Transit Corporation to appellants for the two (2) lots,
and that it was he who introduced the buyer to appellants and unceasingly facilitated the negotiation which ultimately led
to the consummation of the sale. Hence, he sued below to collect the balance of P303,606.24 after having
received P48,893.76 in advance.

The Court of Appeals Ruled in favor of Appellee Artigo. Hence, this petition.

ISSUE:

Whether or not the case should have been dismissed by the court for failure to implead parties in interest.

HELD:
No. The De Castros argue that Artigos complaint should have been dismissed for failure to implead all the co-owners of
the two lots. The De Castros claim that Artigo always knew that the two lots were co-owned by Constante and Corazon
with their other siblings Jose and Carmela whom Constante merely represented. The De Castros contend that failure to
implead such indispensable parties is fatal to the complaint since Artigo, as agent of all the four co-owners, would be paid
with funds co-owned by the four co-owners.
The De Castros contentions are devoid of legal basis.
An indispensable party is one whose interest will be affected by the courts action in the litigation, and without whom no
final determination of the case can be had. The joinder of indispensable parties is mandatory and courts cannot proceed
without their presence. Whenever it appears to the court in the course of a proceeding that an indispensable party has not
been joined, it is the duty of the court to stop the trial and order the inclusion of such party.
However, the rule on mandatory joinder of indispensable parties is not applicable to the instant case.
The De Castros admit that the other co-owners are solidarily liable under the contract of agency, citing Article 1915 of the
Civil Code, which reads:

Art. 1915. If two or more persons have appointed an agent for a common transaction or undertaking, they shall be
solidarily liable to the agent for all the consequences of the agency.

The solidary liability of the four co-owners, however, militates against the De Castros theory that the other co-owners
should be impleaded as indispensable parties.
Thus, the Court has ruled in Operators Incorporated vs. American Biscuit Co., Inc. that solidarity does not make a solidary
obligor an indispensable party in a suit filed by the creditor. Article 1216 of the Civil Code says that the creditor `may
proceed against anyone of the solidary debtors or some or all of them simultaneously.
Case #: 12
By: Siddayao, Janus

Victor Orquiola and Honorata Orquiola vs. CA, The Sheriff of Q.C. and Pura Kalaw Ledesma, substituted by
Tandang Sora Development Corporation
389 SCRA 461, August 6, 2003

Doctrine:

Parties to Civil Actions. - No man shall be affected by any proceeding to which he is a stranger, and strangers to a case
are not bound by any judgment rendered by the court; only real parties in interest are bound by the judgment therein and
by writs f execution and demolition issued pursuant thereto.

Facts.

Pura Kalaw Ledesma was the registered owner of Lot 689, covered by TCT Nos. 111267 and 111266, in Tandang Sora,
Quezn City. This parcel of land was adjacent t certain portions f Lot 707 of the Piedad Estates, namely, Lot 707-A and
707-B, registered in the name of Herminigilda Pedro under TCT Nos. 16951 and 16952, respectively. On October 29,
1964, Herminigilda sold Lot 707-A and 707-B to Mariano Lising who then registered both lots and Lot 707-C in the name
of M. B. Lising Realty and subdivided them into smaller lots.

Certain portin of the subdivided lots were sold to third persons including herein petitioners, spouses Victor and Honorata
Orquiola, who purchased a portion of Lot 707-A, Lot 5, Block 1 of the subdivision plan (LRC), Psd-42965. The parcel is
now #33 Doa Regina St., Regina Vilage, Tandang Sora, Quewzn City. The other portions were registered in the name of
the heirs of Pedro, heirs of Lising, and other third persons.

Sometime in 1969, Pura Kalaw Ledesma filed a complaint docketed as Civil Case No. Q-12918, with the RTC of Quezon
City against Herminigilda Pedro and Mariano Lising for allegedly encroaching upon Lot 689. During the pendency of the
action, Tandang Sora Development Corporation replaced Pura Kalaw Ledesma in favor of said Corporation. Trial
continued for three decades.

On august 21, 1991, the trial court finally adjudged defendants Pedro and Lising jointly and severally liable for
encroaching plaintiffs land.

To prohibit Judge Vicencio Baclig of the RTC of Quezon City from issuing a writ of demolition and the Quezon City sheriff
from implementing the alias writ of execution, petitioners filed with the CA a petition for Prohibition with prayer for a
restraining order and preliminary injunction n April 17, 1998. Petitioners alleged that they bought the subject parcel of
land in good faith and for a value, hence, they were parties in interest. Since they were not impleaded in Civil Case No.
Q-12918, the writ of demolition issued in connection therewith cannot be enforced against them because to do so would
amount to deprivation f property without due process of law.

The CA dismissed the petition on January 28, 1999. It held that as buyers and successors-in-interest of Mariano Lising,
petitioners were considered privies who derived their rights from Lising by virtue of the sale and could be reached by the
execution order in Civil Case No. Q-12918.

Hence, this petition.

Issue:

WON, the CA erred in holding that the decision in Civil Case No. Q-12918 can also be enforced against the petitioners
even if they were not impleaded as parties thereto.

Held:

Yes. As builders in good faith and innocent purchasers for value, petitioners have rights over the subject property and
hence they are proper parties in interest in any case thereon. Consequently, private respondents should have impleaded
them in Civil Case No. Q-12918. Since they failed to do so, petitioners cannot be reached by the decision in said case. N
man shall be affected by any proceeding to which he is a stranger, and strangers to a case are not bound by any
judgment rendered by the court. In the same manner a writ f execution can be issued only against a party and not against
a party and not against who did not have his day in court. Only real parties in interest in an action are bound by the
judgment therein and by writs of execution and demolition issued pursuant thereto. In Our view, the spouses Victor and
Honorata Orquiola have valid and meritorious cause to resist the demolition of their house on their own title it, which is
tantamount to a deprivation of property without due process of law.
Case #: 13
By: Pacheco, Jose Acerey M.

China Banking Corp. vs. Oliver

GR no. 135796 Oct. 3, 2003

Doctrine:

Civil Procedure, Indispensable Parties, Sec. 2, Rule 3, Rules of Court - Parties in Interest. A real party in interest is the
party who stands to be benefited or injured by the judgment in the suit, or the party entitled to the avails of the suit. Unless
otherwise authorized by law or these Rules, every action must be prosecuted or defended in the name of the real party in
interest.

- An indispensable party is a party in interest, without whom no final determination can be had of an action.

Facts:

Pangan Lim, Jr. and a Mercedes M. Oliver opened a joint account in China Banking Corporation. Lim and Oliver applied
for a loan, offering as collateral a lot covered by TCT No. S-50195 in the name of Oliver. The bank approved the
application. Lim and Oliver executed in favor of Petitioner a promissory note, as well as a Real Estate Mortgage on the
property.

Respondent claiming that she is Mercedes M. Oliver filed an action for annulment of mortgage and cancellation of title
with damages against Petitioner. Respondent claimed that she was the registered and lawful owner of the land subject of
the real estate mortgage; that the owners duplicate copy of the title had always been in her possession; and that she did
not apply for a loan or surrender her title to Petitioner.
Petitioner moved to dismiss the case for lack of cause of action and non-joinder of an indispensable party, the mortgagor.

The RTC issued an order denying the motion to dismiss, stating that the plaintiff having sufficiently averred that
defendants negligently failed to ascertain the genuineness or not of the title of the land mortgaged to it upon the claim of
ownership by the mortgagors.

Petitioner filed with the CA a petition for the issuance of a writ of preliminary injunction and/or restraining order to enjoin
enforcement of the RTC order and further action on the case.

The CA promulgated the assailed decision, finding no grave abuse of discretion committed by the RTC in ruling that the
Rules of Court provided the manner of impleading parties to a case and in suggesting that petitioner file an appropriate
action to bring the mortgagor within the courts jurisdiction. The appellate court said that Rule 6, Section 11 of the Rules of
Court allows petitioner to file a third-party complaint against the mortgagor.

Issue:

Whether or not the Mortgagor is an indispensable party under Sec 7, Rule 3 of th Rules of Civil Procedure and must be
joined as a party-defendant.

Wether or not the trial court should dismiss the case when an indispensable party is not in court.

Held:

The court ruled that Petitioners contention is not tenable. The court states Sec 7, Rule 3 of the Rules of Procedure and
the definition of an indispensable party;

Sec. 7, Rule 3, 1997 Revised Rules of Court: Compulsory joinder of indispensable parties. Parties in interest without
whom no final determination can be had of an action shall be joined either as plaintiffs or defendants.
An indispensable party is a party in interest, without whom no final determination can be had of an action.

It is true that mortgagor is a party in interest. However, mortgagor absence from the case does not hamper the trial court
in resolving the dispute between respondent and petitioner. The Respondent's allegations in the complaintwas for
annulment of mortgage due to petitioners negligence in not determining the actual ownership of the property, resulting in
the mortgages annotation on TCT No. S-50195 in the Registry of Deeds custody. To support said allegations, respondent
had to prove (1) that she is the real Mercedes M. Oliver referred to in the TCT, and (2) that she is not the same person
using that name who entered into a deed of mortgage with the petitioner. This, respondent can do in her complaint without
necessarily impleading the mortgagor. Hence, the mortgagor is not an indispensable party in the case filed by
Respondent.

As to the second issue, since mortgagor is not an indispensable party, Section 7, Rule 3 of the 1997 Rules of Civil
Procedure, which requires compulsory joinder of indispensable parties in a case, does not apply. Instead, it is Section 11,
Rule 3, that applies. Non-joinder of parties is not a ground for dismissal of an action. Parties may be added by order of the
court, either on its own initiative or on motion of the parties.
Case #: 14
By: Pion, Paola Margarita V.

Lotte Phils. Co., Inc. v. De la Cruz

GR. No. 166302 | July 28, 2005

DOCTRINE:

Civil Procedure; Parties; Pleadings and Practice; An indispensable party is a party in interest without whom no
final determination can be had of an action, and who shall be joined either as plaintiffs or defendants; The joinder of
indispensable parties is mandatory; The absence of an indispensable party renders all subsequent actions of the court
null and void for want of authority to act, not only as to the absent parties but even as to those present

The non-joinder of indispensable parties is not a ground for the dismissal of an action and the remedy is to
implead the non-party claimed to be indispensable.

FACTS:

Private respondent (petitioner herein) Lotte Phils., Inc. (Lotte) is a domestic corporation. Petitioners (respondents
herein) are among those who were hired and assigned to the confectionery facility operated by private respondent.

On December 14, 1995—7J Maintenance and Janitorial Services (“7J”) entered into a contract with private
respondent to provide manpower for needed maintenance, utility, janitorial and other services to the latter. In compliance
with the terms and conditions of the service contract, and to accommodate the needs of private respondent for
personnel/workers to do and perform “piece works,” petitioners, among others, were hired and assigned to private
respondent as repackers or sealers.

However, either in October, 1999 or on February 9, 2000, private respondent dispensed with their services
allegedly due to the expiration/termination of the service contract by respondent with 7J. Unfortunately, petitioners were
never called back to work again.

ISSUE:

Whether 7J Maintenance and Janitorial Service was an indispensable party.

HELD:

Yes. 7J is an indispensable party. It is a party in interest because it will be affected by the outcome of the case.
The Labor Arbiter and the NLRC found 7J to be solely liable as the employer of respondents. The Court of Appeals
however rendered Lotte jointly and severally liable with 7J who was not impleaded by holding that the former is the real
employer of respondents. Plainly, its decision directly affected 7J.

An indispensable party is a party in interest without whom no final determination can be had of an action, and who
shall be joined either as plaintiffs or defendants. The joinder of indispensable parties is mandatory. The presence of
indispensable parties is necessary to vest the court with jurisdiction, which is “the authority to hear and determine a
cause, the right to act in a case.” Thus, without the presence of indispensable parties to a suit or proceeding, judgment of
a court cannot attain real finality. The absence of an indispensable party renders all subsequent actions of the court null
and void for want of authority to act, not only as to the absent parties but even as to those present.
Case #: 15
By: Ragragio, Rosy June

Carabeo vs. Dinco

G.R. No. 190823, April 4, 2011

DOCTRINE:

The doctrine in the case of Bonilla v. Barcena was emphasized stating that: The question as to whether an action survives
or not depends on the nature of the action and the damage sued for. In the causes of action which survive, the wrong
complained of affects primarily and principally property and property rights, the injuries to the person being merely
incidental, while in the causes of action which do not survive, the injury complained of is to the person, the property and
rights of property affected being incidental. The object of the sale in this case is deemed determinate thus no further
agreements are necessary.

FACTS:

On July 10, 1990, Domingo Carabeo (petitioner) entered into a contract with Spouses Norberto and Susan Dingco
(respondents) whereby petitioner agreed to sell his rights over a 648 square meter parcel of unregistered land situated in
Purok III, Tugatog, Orani, Bataan to respondents for P38,000. A payment of P10,000 was deposited upon signing of the
contract, the remaining balance to be paid on September 1990. However due to a land dispute, the respondents gave
petitioner small sums of money from time to time which totaled P9,100 due to respondents inability to pay in full amount.
Despite the alleged problem over the land, they insisted on petitioners acceptance of the remaining balance of P18,900
but petitioner remained firm in his refusal, proffering as reason therefor that he would register the land first. Sometime in
1994, respondents learned that the alleged problem over the land had been settled and that petitioner had caused its
registration in his name on December 21, 1993 under Transfer Certificate of Title No. 161806. They thereupon offered to
pay the balance but petitioner declined, drawing them to file a complaint before the Katarungan Pambarangay. No
settlement was reached, however, hence, respondent filed a complaint for specific performance before the Regional Trial
Court (RTC) of Balanga, Bataan. Petitioner countered in his Answer to the Complaint that the sale was void for lack of
object certain, the “kasunduan” not having specified the metes and bounds of the land. In any event, petitioner alleged
that if the validity of the kasunduan is upheld, respondents failure to comply with their reciprocal obligation to pay the
balance of the purchase price would render the action premature. For, contrary to respondents claim, petitioner
maintained that they failed to pay the balance of P28,000 on September 1990 to thus constrain him to accept installment
payments totaling P9,100. The petitioner passed away after the case was submitted for decision.

ISSUE:

1. Whether the contract was valid.

2. Whether or not the petitioner’s death causes dismissal of the action filed by the respondents.

HELD:

1. Yes, the contract is valid. Article 1318 of the New Civil Code expressly provides that there is no contract unless the
following essential requisites concur, to wit: (1) there is consent among the contracting parties; (2) there is a certain object
that is the subject matter of the contract; and (3) there is a cause or consideration for which the obligation is established.
There is no nullity in the sale even when the “kasunduan “did not specify the technical boundaries of the property. The
requirement that a sale must have for its object a determinate thing is satisfied as long as, at the time the contract is
entered into, the object of the sale is capable of being made determinate without the necessity of a new or further
agreement between the parties.

2. It bears noting that trial on the merits was already concluded before petitioner died. Since the trial court was not
informed of petitioner’s death, it may not be faulted for proceeding to render judgment without ordering his substitution. Its
judgment is thus valid and binding upon petitioners legal representatives or successors-in-interest, insofar as his interest
in the property subject of the action is concerned.
Case #: 16
By: Rigor, Karla Michaela J.

JULITA DE LA CRUZ and FELIPE DE LA CRUZ v. PEDRO JOAQUIN

G.R. No. 162788, July 28, 2005

DOCTRINE:
Remidial Law. Parties. Substitution. The Rules require the legal representatives of a dead litigant to be substituted as
parties to a litigation. This requirement is necessitated by due process. Thus, when the rights of the legal representatives
of a decedent are actually recognized and protected, noncompliance or belated formal compliance with the Rules cannot
affect the validity of the promulgated decision. After all, due process had thereby been satisfied.

FACTS:

This case involves a complaint for recovery of possession and ownership, the cancellation of title, and damages, filed by
Pedro Joaquin against the petitioner spouses –Julita and Felipe Dela Cruz. During the motion for reconsideration of the
parties, the respondent – Pedro Joaquin – died. The CA, then, denied the reconsideration and ordered substitution nby
the legal representatives of the respondent.

ISSUE:

Whether or not the trial court lost jurisdiction over the case upon the death of Pedro Joaquin.

HELD:

When a party to a pending action dies and the claim is not extinguished, the Rules of Court require a substitution of the
deceased. It is specifically governed by Section 16 of Rule 3. The rule on substitution was crafted to protect every party’s
right to due process and the estate will be properly represented in the suit through the authorized legal representative.
Moreover, no adjudication can be made against the successor of the deceased if the fundamental right to a day in court is
denied.The rule on the substitution by heirs is not a matter of jurisdiction, but a requirement of due process. Thus, when
due process is not violated, as when the right of the representative or heir is recognized and protected, noncompliance or
belated formal compliance with the Rules cannot affect the valididty of a promulgated decision.

In this case, the heirs of Pedro Joaquin voluntary appeared and participated in the case. There being no violation of due
process, the issue of substitution cannot be upheld as a ground to nullify the trial courts Decision.
Case #: 17
By: Siugan, Tina

NAVARRO VS. ESCOBIDO

DOCTRINE:
CIVIL PROCEDURE; RULE 3, 1997 RULES OF CIVIL PROCEDURE; PARTIES – The 1997 Rules of Civil Procedure
requires that every action must be prosecuted or defended in the name of the real party-in-interest, i.e., the party who
stands to be benefited or injured the judgment in the suit, or the party entitled to the avails of the suit.

FACTS:

Roger Navarro executed a lease agreement, with option to purchase, with Glenn Go, over two motor vehicles. Glenn Go
is the husband of Karen Go, who owns KARGO ENTERPRISES (sole proprietorship business). Navarro undertook to pay
the lease by giving checks in the name of KARGO. When such checks were dishonored due to insufficiency of funds,
Karen filed two cases for replevin and collection of sum of money with damages against Navarro. In his answer, Navarro
alleged that the two complaints have no cause of action because Karen, who was not a party to the Lease Agreements
with Options to Purchase. The RTC dismissed the case but ordered Karen to file a motion for the inclusion of Glenn Go
as co-plaintiff since KARGO ENTERPRISES forms part of the latter two’s conjugal property. Navarro moved for
reconsideration but the same was denied by the trial court. This prompted him to elevate the case to the CA. He contends
that the RTC committed grave abuse of discretion when it directed Karen to amend her complaints by including her
husband as co-plaintiff. CA denied Navarro’s petition and affirmed the RTC’s decision. Aggrieved, Navarro appealed
against such decision before the Supreme Court. Navarro posits that since it was Karen Go who filed the complaints and
not Glenn, she was not a real-party-in-interest and the complaints must be dismissed for lack of cause of action.

ISSUE:

WON the complaints lacked cause of action because the plaintiff, Karen Go, is not a real-party-in-interest.

RULING:

YES. Karen Go is a real-party-in-interest despite the fact that the lease contracts were executed by her husband,
Glenn. This is because, as husband and wife, they are co-owners of KARGO ENTERPRISES; hence, anyone of
them may bring an action to recover against Navarro. This conclusion, according to the Supreme Court, must be read
vis a vis Rule 3, Section 2, of the 1997 Rules of Civil Procedure, which states that “ a real party in interest is the party who
stands to be benefited or injured by the judgment in the suit, or the party entitled to the avails of the suit. Unless otherwise
authorized by law or these Rules, every action must be prosecuted or defended in the name of the real party in interest”.
As the registered owner of the business, Karen is the party who will directly benefit from or be injured by a judgment in the
present case. Glenn Go’s participation as the creditor in the lease agreements is of no moment. In this regard, the Court
held that since KARGO ENTERPRISES is Karen and Glenn’s conjugal property, any one or either of them can speak and
act with authority m managing it. Consequently, Karen or Glenn may bring the present suit against Navarro. Therefore, as
held by the Court, Glenn is not strictly an indispensable party in the present case.
Case #: 18
By: Villamor, Wilbert

LAND BANK VS CACAYURAN

DOCTRINE: The non-joinder of indispensable parties is not a ground for the dismissal of an action. The remedy
is to implead the non-party claimed to be indispensable. If the plaintiff refuses to implead an indispensable party
despite the order of the court, that court may dismiss the complaint for the plaintiff’s failure to comply with the
order.

FACTS:

The Municipality of Agoo, La Union, authorized Mayor Eriguel to enter into two loans with the Land Bank. In order to
secure the loans, the Municipality used as collateral, among others, a portion of the Public Plaza. However, a group of
residents, led by respondent Eduardo M. Cacayuran (Cacayuran), opposed the redevelopment of the Public Plaza, as
well as the funding therefor thru the Subject Loans, claiming that these were "highly irregular, violative of the law, and
detrimental to public interests, and will result to wanton desecration of the Public Plaza. Thus, Cacayuran, invoking his
right as a taxpayer, filed a complaint14 against LBP and various officers of the Municipality, including Mayor Eriguel (but
excluding the Municipality itself as party-defendant), assailing the validity of the aforesaid loan agreements and praying
that the commercialization of the Public Plaza be enjoined.

ISSUE:

W/N the Municipality should be deemed as an indispensable party to the instant case, and thus, be ordered impleaded

HELD:

YES. An indispensable party is one whose interest will be affected by the court's action in the litigation, and without whom
no final determination of the case can be had. The party's interest in the subject matter of the suit and in the relief sought
are so inextricably intertwined with the other parties' that his legal presence as a party to the proceeding is an absolute
necessity. In his absence, there cannot be a resolution of the dispute of the parties before the court which is effective,
complete, or equitable. Thus, the absence of an indispensable party renders all subsequent actions of the court null and
void, for want of authority to act, not only as to the absent parties but even as to those present. In this case, a judicious
review of the records reveals that Cacayuran's complaint against LBP and the municipal officers primarily prays that the
commercialization of the Public Plaza be enjoined and also, that the Subject Loans be declared null and void for having
been unlawfully entered into by the said officers. However, Cacayuran failed to implead in his complaint the Municipality, a
real party-in-interest and an indispensable party that stands to be directly affected by any judicial resolution on the case,
considering that: (a) the contracting parties to the Subject Loans are LBP and the Municipality; and (b) the Municipality
owns the Public Plaza as well as the improvements constructed thereon, including the Agoo People's Center. The non-
joinder of indispensable parties is not a ground for the dismissal of an action. At any stage of a judicial proceeding
and/or at such times as are just, parties may be added on the motion of a party or on the initiative of the tribunal
concerned. If the plaintiff refuses to implead an indispensable party despite the order of the court, that court may dismiss
the complaint for the plaintiffs failure to comply with the order. The remedy is to implead the non-party claimed to be
indispensable.

The Case is remanded to the RTC and directed to order Cacayuran to implead all indispendable parties, and proceed with
the resolution of the case on the merits.
Case #: 19
By: Zaragoza, Renee Mae

Divinagracia vs. Parilla

GR no. 196750, March 11, 2015

DOCTRINE:

Civil Procedure, Parties to Civil Actions - A person having the right to compel the partition of real estate may do so as
provided in this Rule, setting forth in his complaint the nature and extent of his title and an adequate description of the real
estate of which partition is demanded and joining as defendants all other persons interested in the property. (Sec 1, Rule
69 Rules of Court)

FACTS:

Petitioner has purchased the subject land with P447,695.66, in a Deed of Extrajudicial Settlement or Adjudication with
Deed of Sale, which was, however, not signed by the Respondents who did not sell their respective shares, The vendor
of the land then executed a Supplemental Contract whereby the vendors and Petitioner agreed that out of the aforesaid
consideration, only P109,807.93 will be paid up front, and that Petitioner will only pay the remaining balance of
P337,887.73 upon the partition of the subject land. However, Petitioner was not able to have the former title of the land
cancelled and the deed of extrajudicial settlement registered because of some of the Respondent's refusal to surrender
the said title. This prompted petitioner to file a complaint for judicial partition and for receivership but.

Respondents maintained that the Petitioner had no legal right to file an action for judicial partition nor compel them to
surrender the land title because of the ff. reasons; (1) Petitioner did not pay the full purchase price of the shares sold to
him; and (2) the subject land is a conjugal asset of the Respondent’s parents and, thus, only their legitimate issues may
inherit.

The RTC ordered the partition of the subject land between Petitioner on the one hand, and Respondents on the other
hand and, consequently, the cancellation of the former land title and the issuance of a new owner’s duplicate certificate in
favor of Petitioner and the group of Respondents. The RTC found that through the subject document, Petitioner became a
co-owner of the subject land and has the right to demand the partition of the same. However, the RTC held that Petitioner
did not validly acquire one of the Respondent's share over the subject land.

On reconsideration of Respondents, the RTC issued an order for the Petitioner to comply with the provisions of the
Supplemental Contract by paying the amount of P337,887.73 upon the partition of the subject land.

The CA set aside the RTC Rulings and, consequently, dismissed Petitioner’s complaint for judicial partition. It held that the
respondents, are indispensable parties to the judicial partition of the subject land and, thus, their non-inclusion as
defendants in Petitioner’s complaint would necessarily result in its dismissal.

ISSUE:

Whether or not that the Respondents are indispensable parties to the complaint for judicial partition; and whether or not
that said complaint should be dismissed for failure to implead said omitted heirs.

HELD:

(1) On the first issue, the court ruled that all the co-heirs and persons having an interest in the property are indispensable
parties; as such, an action for partition will not lie without the joinder of the said parties.

An indispensable party is one whose interest will be affected by the court’s action in the litigation, and without whom no
final determination of the case can be had. The party’s interest in the subject matter of the suit and in the relief sought are
so inextricably intertwined with the other parties’ that his legal presence as a party to the proceeding is an absolute
necessity. In his absence, there cannot be a resolution of the dispute of the parties before the court which is effective,
complete, or equitable

Stating Section 1, Rule 69 of the Rules of Court;

SEC. 1. Complaint in action for partition of real estate. – A person having the right to compel the partition of real estate
may do so as provided in this Rule, setting forth in his complaint the nature and extent of his title and an adequate
description of the real estate of which partition is demanded and joining as defendants all other persons interested in
the property. (Emphasis and underscoring supplied)

In the instant case, records reveal that the father of the Petitioner and Respondents has multiple heirs who are entitled to
a pro-indiviso share in the subject land and, whether in their own capacity or in representation of their direct ascendant,
have vested rights over the subject land and should be impleaded as indispensable parties in an action for partition. The
Petitioner's complaint shows that only one of the heirs, excluding therefrom his siblings and co-representatives.

(2) On the second issue, the court held that the CA erred in ordering the dismissal of the complaint on account of
Petitioner’s failure to implead all the indispensable parties in his complaint. The court explained that in instances of non-
joinder of indispensable parties, the proper remedy is to implead them and not to dismiss the case.

Stating Heirs of Mesina vs. Heirs of Fian Sr.;

The non-joinder of indispensable parties is not a ground for dismissal. At any stage of a judicial proceeding and/or at such
times as are just, parties may be added on the motion of a party or on the initiative of the tribunal concerned. If the plaintiff
refuses to implead an indispensable party despite the order of the court, that court may dismiss the complaint for the
plaintiff’s failure to comply with the order. The remedy is to implode those claimed to be indispensable.
Case #: 20
By: Arevalo, Jake Ivan

PACIFIC CONSULTANTS INTERNATIONAL ASIA v SCHONFELD

G.R. No. 166920, February 19, 2007

Doctrine:
Civil Procedure; Jurisdiction - B.P 129, Section 9: The Court of Appeals shall Exercise:
1. Original jurisdiction to issue writs of mandamus, prohibition, certiorari, habeas corpus, and quo warranto, and auxiliary
writs or processes, whether or not in aid of its appellate jurisdiction;
2. Exclusive original jurisdiction over actions for annulment of judgements of Regional Trial Courts; and
3. Exclusive appellate jurisdiction over all final judgements, resolutions, orders or awards of Regional Trial Courts and
quasi-judicial agencies, instrumentalities, boards or commission, including the Securities and Exchange Commission, the
Social Security Commission, the Employees Compensation Commission and the Civil Service Commission, Except those
falling within the appellate jurisdiction of the Supreme Court in accordance with the Constitution, the Labor Code of the
Philippines under Presidential Decree No. 442, as amended, the provisions of this Act, and of subparagraph (1) of the
third paragraph and subparagraph 4 of the fourth paragraph od Section 17 of the Judiciary Act of 1948.

Facts:
Respondent is a Canadian citizen and was a resident of New Westminster, British Columbia, Canada. He had been a
consultant in the field of environmental engineering and water supply and sanitation. Pacicon Philippines, Inc. (PPI) is a
corporation duly established and incorporated in accordance with the laws of the Philippines. The primary purpose of PPI
was to engage in the business of providing specialty and technical services both in and out of the Philippines. It is a
subsidiary of Pacific Consultants International of Japan (PCIJ). The president of PPI, Jens Peter Henrichsen, who was
also the director of PCIJ, was based in Tokyo, Japan. Henrichsen commuted from Japan to Manila and vice versa, as well
as in other countries where PCIJ had business.

On December 5, 2000, respondent filed a Complaint for Illegal Dismissal against petitioners PPI and Henrichsen with the
Labor Arbiter. In his Complaint, respondent alleged that he was illegally dismissed; PPI had not notified the DOLE of its
decision to close one of its departments, which resulted in his dismissal; and they failed to notify him that his employment
was terminated after August 4, 1999.
Petitioners filed a Motion to Dismiss the complaint on the following grounds: (1) the Labor Arbiter had no jurisdiction over
the subject matter; and (2) venue was improperly laid. It averred that respondent was a Canadian citizen, a transient
expatriate who had left the Philippines. He was employed and dismissed by PCIJ, a foreign corporation with principal
office in Tokyo, Japan. Since respondents cause of action was based on his letter of employment executed in Tokyo,
Japan dated January 7, 1998, under the principle of lex loci contractus, the complaint should have been filed in Tokyo,
Japan. Petitioners claimed that respondent did not offer any justification for filing his complaint against PPI before the
NLRC in the Philippines. Moreover, under Section 12 of the General Conditions of Employment appended to the letter of
employment dated January 7, 1998, complainant and PCIJ had agreed that any employment-related dispute should be
brought before the London Court of Arbitration. Since even the Supreme Court had already ruled that such an agreement
on venue is valid, Philippine courts have no jurisdiction.

Issue:
Whether or not the CA is proscribed to review factual issues in resloving a petition for certiorari.

Held:

The petition is denied for lack of merit. It must be stressed that in resolving a petition for certiorari, the CA is not
proscribed from reviewing the evidence on record. Under Section 9 of Batas Pambansa Blg. 129, as amended by R.A.
No. 7902, the CA is empowered to pass upon the evidence, if and when necessary, to resolve factual issues. If it appears
that the Labor Arbiter and the NLRC misappreciated the evidence to such an extent as to compel a contrary conclusion if
such evidence had been properly appreciated, the factual findings of such tribunals cannot be given great respect and
finality.
Case #: 21
By: Calma, Sarah

CASE TITLE: BIACO v COUNTRYSIDE RURAL BANK

GR NO. AND DATE: G.R. NO. 161417, February 8, 2007

DOCTRINE:

Civil Procedure. Venue. Distinction between Venue and Jurisdiction. – In a proceeding in rem or quasi in rem, jurisdiction
over the person of the defendant is not a prerequisite to confer jurisdiction on the court provided that the court acquires
jurisdiction over the res. Jurisdiction over the res is acquired either (1) by the seizure of the property under legal process,
whereby it is brought into actual custody of the law; or (2) as a result of the institution of legal proceedings, in which the
power of the court is recognized and made effective.

A judicial foreclosure proceeding is an action quasi in rem. As such, jurisdiction over the person of petitioner is not
required, it being sufficient that the trial court is vested with jurisdiction over the subject matter.

FACTS:

Ernesto Biaco is the husband of petitioner Ma. Teresa Chaves Biaco. While employed in the Philippine Countryside Rural
Bank (PCRB) as branch manager, Ernesto obtained several loans from the respondent bank.

As security for the payment of the said loans, Ernesto executed a real estate mortgage in favor of the bank covering the
parcel of land which the real estate mortgages bore the signatures of the spouses Biaco.

When Ernesto failed to settle the above-mentioned loans on its due date, respondent bank through counsel sent him a
written demand, however, proved futile.

Respondent bank filed a complaint for foreclosure of mortgage against the spouses Ernesto and Teresa Biaco before the
RTC of Misamis Oriental. Summons was served to the spouses Biaco through Ernesto at his office (Export and Industry
Bank). The RTC ruled against them. As a result, a writ of execution was served on the spouses.

Petitioner sought the annulment of the Regional Trial Court decision contending, among others, that the trial court failed to
acquire jurisdiction because summons was served on her through her husband without any explanation as to why
personal service could not be made. The CA affirmed RTC decision invoking that judicial foreclosure proceedings are
actions quasi in rem. As such, jurisdiction over the person of the defendant is not essential as long as the court acquires
jurisdiction over the res.

Petitioner further argues that the deficiency judgment is a personal judgment which should be deemed void for lack of
jurisdiction over her person.

Respondent PCRB filed its Comment, essentially reiterating the appellate court’s ruling. Respondent avers that service of
summons upon the defendant is not necessary in actions quasi in rem it being sufficient that the court acquire jurisdiction
over the res. As regards the alleged conspiracy between petitioner’s husband and the sheriff, respondent counters that
this is a new argument which cannot be raised for the first time in the instant petition.

ISSUE:

Whether or not the case should be dismissed for lack of jurisdiction over the person of petitioner.

HELD:

No. The Court ruled that the trial court validly try and decide the case. In a proceeding in rem or quasi in rem, jurisdiction
over the person of the defendant is not a prerequisite to confer jurisdiction on the court provided that the court acquires
jurisdiction over the res. Jurisdiction over the res is acquired either (1) by the seizure of the property under legal process,
whereby it is brought into actual custody of the law; or (2) as a result of the institution of legal proceedings, in which the
power of the court is recognized and made effective.
In this case, the judicial foreclosure proceeding instituted by respondent PCRB undoubtedly vested the trial court with
jurisdiction over the res. A judicial foreclosure proceeding is an action quasi in rem. As such, jurisdiction over the person
of petitioner is not required, it being sufficient that the trial court is vested with jurisdiction over the subject matter.
Case #: 22
By:Capurcos, Jumel

BPI FAMILY SAVINGS BANK INC.

vs.SPOUSES BENEDICTO & TERESITA YUJUICO
G.R. No. 175796 July 22, 2015

DOCTRINE:

Civil Procedure: Venue Is Procedural, Not Jurisdictional, And May Be Waived By The Defendant If Not Seasonably
Raised Either In A Motion To Dismiss Or In The Answer.

FACTS:

City of Manila filed a complaint for expropriation of five parcels of land located in Tondo, Manila, owned by the
respondents before the RTC of Manila. Two of the five parcels of lands were under a First Real Estate Mortgage Contract
to Citytrust Banking Coroporaiton, predecessor in interest of the petitioner. After the RTC rendered judgment
expropriating the lots, the petitioner filed its Motion to Intervene in Execution with Partial Opposition to Defendant’s
Request to Release, which the RTC denied. The petitioner then extrajudicially foreclosed the two lots, and after the public
auction, the amount of P18,522,155.42 remained as judgment deficiency, which the petitioners sought to recover from the
respondents by filing a complaint before the RTC of Makati City (Civil Case No. 03-450). The respondents moved to
dismiss on the ground of res judicata, lack of cause of cause of action and that plaintiff’s claim had been abandoned,
waived or extinguished. The petitioners opposed the motion. While the RTC denied the motion to dismiss, the
respondents filed their reply to the petitioner’s comment to the motion to dismiss, raising for the first time the issue of
improper venue. They aver that the action to recover deficiency judgment should be filed in the RTC of Manila which
ruled on the extra-judicial foreclosure of real estate mortgage, being a supplementary action to the latter. The RTC denied
the respondents’ motion for reconsideration; on the issue of improper venue, it held that even if the venue was improperly
laid, the respondents failed to allege it in their motion to dismiss; an action cannot be dismissed on a ground not alleged in
the motion to dismiss eve if said ground is provided in Rule 16.

On petition for certiorari, the CA reversed the RTC. It ruled that “a suit for recovery of the deficiency after the foreclosure
of a mortgage is in the nature of a mortgage action because its purpose is precisely to enforce the mortgage contract; it is
upon a written contract and upon an obligation of the mortgage-debtor to pay the deficiency which is created by law. As
such, the venue of an action for recovery of deficiency must necessarily be the same venue as that of the extrajudicial
foreclosure of mortgage.”. Thus the action should have been filed before the RTC of Manila.
The petitioner sought recourse with the Supreme Court.

ISSUE:

Whether venue was improperly laid. i.e. The action to recover deficiency judgment should be filed before the court which
ruled on the extra-judicial foreclosure of real estate mortgage.

HELD:

We grant the petition for review on certiorari.

It is basic that the venue of an action depends on whether it is a real or a personal action. The determinants of whether an
action is of a real or a personal nature have been fixed by the Rules of Court and relevant jurisprudence. According to
Section 1, Rule 4 of the Rules of Court, a real action is one that affects title to or possession of real property, or an interest
therein. Thus, an action for partition or condemnation of, or foreclosure of mortgage on, real property is a real action.⁠1
The real action is to be commenced and tried in the proper court having jurisdiction over the area wherein the real
property involved, or a portion thereof, is situated, which explains why the action is also referred to as a local action. In
contrast, the Rules of Court declares all other actions as personal actions.⁠2 Such actions may include those brought for
the recovery of personal property, or for the enforcement of some contract or recovery of damages for its breach, or for
the recovery of damages for the commission of an injury to the person or property. ⁠3 The venue of a personal action is the
place where the plaintiff or any of the principal plaintiffs resides, or where the defendant or any of the principal defendants
resides, or in the case of a non-resident defendant where he may be found, at the election of the plaintiff, ⁠4 for which
reason the action is considered a transitory one.
Based on the distinctions between real and personal actions, an action to recover the deficiency after the extrajudicial
foreclosure of the real property mortgage is a personal action, for it does not affect title to or possession of real property,
or any interest therein.
It is true that the Court has said in Caltex Philippines, Inc. v. Intermediate Appellate Court⁠5 that “a suit for the recovery of
the deficiency after the foreclosure of a mortgage is in the nature of a mortgage action because its purpose is precisely to
enforce the mortgage contract.” However, the CA erred in holding, upon the authority of Caltex Philippines, Inc., that the
venue of Civil Case No. 03-450 must necessarily be Manila, the same venue as that of the extrajudicial foreclosure of
mortgage. An examination of Caltex Philippines, Inc. reveals that the Court was thereby only interpreting the prescriptive
period within which to bring the suit for the recovery of the deficiency after the foreclosure of the mortgage, and was not at
all ruling therein on the venue of such suit or on the nature of such suit being either a real or a personal action.
Given the foregoing, the petitioner correctly brought Civil Case No. 03-450 in the Makati RTC because Makati was the
place where the main office of the petitioner was located.

Moreover, the Makati RTC observed, and the observation is correct in our view, that it would be improper to dismiss Civil
Case No. 03-450 on the ground of improper venue, assuming that the venue had been improperly laid, considering that
the respondents had not raised such ground in their Motion to Dismiss. As earlier indicated, they came to raise the
objection of improper venue for the first time only in their reply to the petitioner’s comment on their Motion for
Reconsideration. They did so belatedly.
We underscore that in civil proceedings, venue is procedural, not jurisdictional, and may be waived by the defendant if not
seasonably raised either in a motion to dismiss or in the answer. ⁠6 Section 1, Rule 9 of the Rules of Court thus expressly
stipulates that defenses and objections not pleaded either in a motion to dismiss or in the answer are deemed waived. As
it relates to the place of trial, indeed, venue is meant to provide convenience to the parties, rather than to restrict their
access to the courts.7 In other words, unless the defendant seasonably objects, any action may be tried by a court despite
its being the improper venue.