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456. NEW FRONTIER SUGAR CORPORATION, petitioner, vs.

REGIONAL TRIAL COURT, BRANCH 39, ILOILO CITY, respondents.


G.R. NO. 165001
January 31, 2007

Austria-Martinez, J.:

Facts:

NEW FRONTIER Sugar Corporation is a domestic corporation engaged in the business


of raw sugar milling.
August 2002 New Frontier filed a Petition for the Declaration of State of Suspension of
Payments with Approval of Proposed Rehabilitation Plan under the Interim Rules of
Procedure on Corporate Rehabilitation
August 20, 2002 RTC found the petition sufficient and issued a Stay Order dated,
appointing Manuel B. Clemente as rehabilitation receiver, ordering the latter to put up a
bond, and setting the initial hearing on the petition.
One of New Frontiers creditors, the Equitable PCI Bank (EPCIB), filed a
Comment/Opposition with Motion to Exclude Property, alleging that:
o New Frontier is not qualified for corporate rehabilitation, as it can no longer
operate because it has no assets left.
o New Frontiers financial statements, schedule of debts and liabilities, inventory of
assets, affidavit of general financial condition, and rehabilitation plan are
misleading and inaccurate since its properties have already been foreclosed and
transferred to EPCIB before the petition for rehabilitation was filed
o New Frontier, in fact, still owes EPCIB deficiency liability.
January 13, 2003 - RTC issued an Omnibus Order terminating the proceedings and
dismissing the case. New Frontier sought reconsideration but the RTC denied its
Omnibus Motion.
New Frontier then filed with the CA a special civil action for certiorari
July 19, 2004 CA DECISION
o Dismissed New Frontiers petition
o HELD: Findings of the RTC must be sustained. Since New Frontier no longer has
sufficient assets and properties to continue with its operations and answer its
corresponding liabilities, it is no longer eligible for rehabilitation.
o Even if the RTC erred in dismissing the petition, the same could not be corrected
anymore because what New Frontier filed before the CA was a special civil action
for certiorari under Rule 65 of the Rules of Court instead of an ordinary appeal.
Issue:
(1) W/N CA erred in dismissing the petition for suspension of payments?
(2) W/N CA erred in holding that certiorari was an improper remedy?

Ruling:
1) REHABILITATION NOT PROPER FOR THERE ARE NO ASSETS TO BE
CONSERVED
Rehabilitation contemplates a continuance of corporate life and activities in an effort to
restore and reinstate the corporation to its former position of successful operation and
solvency (Ruby Indl. v. CA).
Under the Interim Rules of Corporate Rehabilitation, the RTC must issue a Stay Order
within 5 days from the filing of the petition for rehabilitation and after finding that the
petition is sufficient in form and substance.
o The Stay Order includes the appointment of a rehabilitation receiver. It will also
suspend the enforcement of all claims, prohibit transfer or encumbrance of the
debtors properties, prohibit payment of outstanding debts; and the withholding of
supply of goods and services from the debtor.
o Any transfer or other disposition made in violation of the Stay Order or the
Interim Rules may be declared void upon motion or motu proprio by the court.
o The stay order is effective against both secured and unsecured creditors. The
relation among creditors of a corporation undergoing rehabilitation is described
by the phrase equality is equity.
o Alemars Sibal & Sons v. Elbinias: During rehabilitation receivership, the assets
are held in trust for the equal benefit of all creditors to preclude one from
obtaining an advantage or preference over another by the expediency of an
attachment, execution or otherwise. For what would prevent an alert creditor,
upon learning of the receivership, from rushing posthaste to the courts to secure
judgments for the satisfaction of its claims to the prejudice of the less alert
creditors.
As between creditors, the key phrase is "equality is equity." When a corporation
threatened by bankruptcy is taken over by a receiver, all the creditors should
stand on an equal footing. Not anyone of them should be given any preference by
paying one or some of them ahead of the others. This is precisely the reason for
the suspension of all pending claims against the corporation under receivership.
Instead of creditors vexing the courts with suits against the distressed firm, they
are directed to file their claims with the receiver who is a duly appointed officer
of the SEC.
However, the suspension of enforcement of all claims commences only from the time the
rehabilitation receiver is appointed.
Thus in RCBC v. IAC, the foreclosure of the debtors properties was upheld because the
Management Committee was constituted only after the foreclosure sale.
CAB: The foreclosure by EPCIB was made on May 14, 2002 while the rehabilitation
receiver was appointed only on August 20, 2002. EPCIB thus acted within its rights to
foreclose the property and have title transferred to it since the foreclosure was made prior
to the appointment of the rehabilitation receiver.
o The fact that there is a pending case for the annulment of the foreclosure is of no
moment, because New Frontier remains without title to the properties until the
court annuls the foreclosure sale (Yulienco v. CA). In such case, the court has a
ministerial duty to grant a possessory writ over the properties.
o CA, therefore, did not err in ruling that the title to New Frontiers properties had
already passed to EPCIB; and that New Frontier has no more assets to speak of.
New Frontier does not dispute the fact that the foreclosed properties constituted
the bulk (if not the entirety) of its assets.
Rehabilitation is of a commercial nature, thus the Interim Rules provide for a summary
and non-adversarial proceeding, which is aimed at expeditious resolution for the benefit
of all parties concerned and the economy in general.
BASIC PROCEDURE FOR REHABILITATION UNDER THE INTERIM RULES
1) The petition is filed with the appropriate Regional Trial Court
2) If the petition is found to be sufficient in form and substance, the trial court
shall issue a Stay Order, which shall provide, among others, for the appointment
of a Rehabilitation Receiver; the fixing of the initial hearing on the petition; a
directive to the petitioner to publish the Order in a newspaper of general
circulation in the Philippines once a week for two (2) consecutive weeks; and a
directive to all creditors and all interested parties (including the Securities and
Exchange Commission) to file and serve on the debtor a verified comment on or
opposition to the petition, with supporting affidavits and documents.
3) Publication of the Stay Order
4) Initial hearing on any matter relating to the petition or on any comment and/or
opposition filed in connection therewith. If the trial court is satisfied that there is
merit in the petition, it shall give due course to the petition
5) Referral for evaluation of the rehabilitation plan to the rehabilitation receiver
who shall submit his recommendations to the court
6) Modifications or revisions of the rehabilitation plan as necessary
7) Submission of final rehabilitation plan to the trial court for approval
8) Approval/disapproval of rehabilitation plan by the trial court
CAB: The rehabilitation petition was dismissed after due consideration of the pleadings
filed. RTC cannot be faulted for summarily dismissing the petition. This amounts to a
finding that it is unmeritorious. Under Rule 49 of the Interim Rules, the court has
authority to give due course to the petition; and it would be wasteful for the RTC to give
due course to the petition even if New Frontier has no assets.
2) APPEAL, NOT CERTIORARI WAS THE PROPER REMEDY; NEW REMEDY PROVIDED
FOR UNDER INTERIM RULES
Certiorari is a remedy for correcting errors of jurisdiction, not errors of judgment. It is an
original and independent action. Being a remedy against jurisdictional errors, it can be
directed against an interlocutory order prior to an appeal, or when there is no appeal
available.
CAB: The Omnibus Order denying New Frontiers petition was a final order since it
terminated the proceedings and dismissed the case. It left nothing more to be done. The
proper remedy from such order is an appeal.
In this regard, A.M. No. 00-8-10-SC promulgated on September 4, 2001 provides that a
petition for rehabilitation is considered a special proceeding given that it seeks to
establish the status of a party or a particular fact.
Accordingly, the period of appeal provided in paragraph 19 (b) of the Interim Rules
Relative to the Implementation of BP 129 for special proceedings shall apply. Under said
paragraph 19 (b), the period of appeal shall be thirty (30) days, a record of appeal being
required.
However, it should be noted that the Court issued A.M. No. 04-9-07-SC on September
14, 2004, clarifying the proper mode of appeal in cases involving corporate rehabilitation
and intracorporate controversies. It is provided therein that all decisions and final orders
in cases falling under the Interim Rules of Corporate Rehabilitation and the Interim Rules
of Procedure Governing Intra-Corporate Controversies under Republic Act No. 8799
shall be appealed to the CA through a petition for review under Rule 43 of the Rules of
Court to be filed within fifteen (15) days from notice of the decision or final order of the
RTC.

Petition denied.
457. JOHNSON LEE and SONNY MORENO, petitioners, vs. PEOPLE OF THE
PHILIPPINES and the COURT OF APPEALS, respondents.
G.R. No. 137914.
December 4, 2002

CORONA, J.

Facts:

Petitioners Johnson Lee and Sonny Moreno were charged by Neugene Marketing,
Inc. (NMI, for brevity), through its designated trustee, Atty. Roger Z. Reyes, with the crime of
estafa with abuse of confidence before the Office of the City Prosecutor, Bacolod City. On
December 14, 1988, the City Prosecutor issued a resolution absolving the petitioners from
criminal liability due to lack of malice on the part of the petitioners in retaining the money of
NMI. The appeal by NMI to the Department of Justice (DOJ, for brevity) was denied on the
ground that the petitioners did not misappropriate corporate funds.
NMI then filed a motion for reconsideration of the DOJ resolution. On January 4, 1991, the
DOJ, through then Undersecretary Silvestre Bello III, ordered the reinvestigation of the
case. Upon recommendation of City Prosecutor Augusto C. Rallos on March 9, 1991 to charge
the petitioners with estafa, Criminal Case Nos. 10010 and 10011 were filed.
The petitioners, on May 4 and 21 of 1992, filed at the DOJ petitions for reinvestigation of
the cases but the same were denied on the ground that the trial courts permission should first be
secured before reinvestigation can be conducted in accordance with this Courts ruling in Crespo
vs. Mogul.[4] Petitioners then filed a motion to suspend the proceedings before the trial court on
the ground that there was a need for reinvestigation and there was a prejudicial question in a
Securities Exchange Commission (SEC, for brevity) case pending before this Court docketed as
G. R. No. 112941. The SEC case questions the validity of the dissolution of NMI and the
designation of Atty. Reyes as trustee.
Initially, the trial court ruled in favor of the petitioners and ordered the DOJ to conduct a
reinvestigation. But, on motion for reconsideration by the prosecutor, the trial court reversed
itself, set aside the previous order and scheduled the arraignment of the petitioners. On January
19, 1996, the petitioners filed another motion to suspend the proceedings, based on the same
ground that the prejudicial question in the SEC case would determine the petitioners guilt in the
criminal cases, thereby necessitating the suspension of the same.
On June 27, 1996, the trial court rendered the first assailed order denying petitioners motion
to suspend the proceedings. Arraignment was scheduled on June 28, 1996. But on the day of the
arraignment, petitioner Lee failed to appear. The trial court then issued the second assailed order,
directing the issuance of a warrant of arrest and fixing an additional bond in the amount
of P30,000 by petitioner Lee.
The petitioners filed before the Court of Appeals a petition for certiorari under Rule 65 of
the Rules of Court, questioning the said orders of the trial court. On August 24, 1998, the
appellate court rendered a decision denying the Petition.

Issue:
Whether or not the court of appeals is correct in dismissing the Petition for Certiorari
under rule 65 filed by the petitioners?
Ruling:
Yes. We have consistently ruled that certiorari lies only where it is clearly shown that
there is a patent and gross abuse of discretion amounting to an evasion of positive duty or virtual
refusal to perform a duty enjoined by law, or to act at all in contemplation of law, as where the
power is exercised in an arbitrary and despotic manner by reason of passion or personal
hostility. Certiorari may not be availed of where it is not shown that the respondent court lacked
or exceeded its jurisdiction over the case, even if its findings are not correct. Its questioned acts
would at most constitute errors of law and not abuse of discretion correctible by certiorari.
In other words, certiorari will issue only to correct errors of jurisdiction and not to correct
errors of procedure or mistakes in the courts findings and conclusions. An interlocutory order
may be assailed by certiorari or prohibition only when it is shown that the court acted without or
in excess of jurisdiction or with grave abuse of discretion. However, this Court generally frowns
upon this remedial measure as regards interlocutory orders. To tolerate the practice of allowing
interlocutory orders to be the subject of review by certiorari will not only delay the
administration of justice but will also unduly burden the courts.
We find that the allegations of the petitioners are not sufficient grounds to qualify as abuse
of discretion warranting the issuance of a writ of certiorari. The petitioners present factual
contentions to absolve them from the criminal charge of estafa. The criminal cases concern
corporate funds petitioners allegedly received as payment for plastic bought by Victorias Milling
Corporation from NMI. They refused to turn over the money to the trustee after NMIs
dissolution on the ground that they were keeping the money for the protection of the corporation
itself. Thus, the elements of misappropriation and damage are absent. They argue that there is no
proof that, as officers of the corporation, they converted the said amount for their own personal
benefit. They likewise claim that they already turned the money over to the majority stockholder
of the defunct corporation.
Clearly, the said allegations are defenses that must be presented as evidence in the hearing of
the criminal cases. They are inappropriate for consideration in a petition for certiorari before the
appellate court inasmuch as they do not affect the jurisdiction of the trial court hearing the said
criminal cases but instead are defenses that might absolve them from criminal liability. A petition
for certiorari must be based on jurisdictional grounds because, as long as the respondent court
acted with jurisdiction, any error committed by it in the exercise thereof will amount to nothing
more than an error of judgment which can be reviewed or corrected on appeal
WHEREFORE, premises considered, the appealed decision of the Court of Appeals is
hereby AFFIRMED. The Regional Trial Court is hereby ordered to conduct the arraignment
with no further delay. Costs against the petitioners.
SO ORDERED.

458.MICROSOFT CORPORATION, petitioner, vs. BEST DEAL COMPUTER CENTER


CORPORATION, PERFECT DEAL CORPORATION, MARCOS C. YUEN doing
business as PERFECT BYTE COMPUTER CENTER and HON.
FLORENTINO M. ALUMBRES, in his capacity as Presiding Judge, RTC-Br. 255, Las Pias
City, respondents.

G.R. No. 148029.


September 24, 2002
Bellosilio , J.:
Facts:
MICROSOFT CORPORATION assails the Order of Judge Florentino M.
Alumbres, RTC-Br. 255, Las Pias City, dated 26 December 2001 in its Civil Case No.
00-0237 denying its application for an ex parte order for the seizure and impounding of
relevant and infringing evidence and the Order dated 1 March 2001 denying
reconsideration thereof.
Petitioner is a US-based corporation. It is not doing business in the Philippines but
has sued in the court below solely to protect its intellectual property rights.
On 4 December 2000 petitioner filed a complaint for Injunction and Damages with
Ex Parte Application for Temporary Restraining Order and the Provisional Measure of
Preservation of Evidence against Best Deal Computer Center Corporation, Perfect Deal
Corporation and Marcos C. Yuen doing business as Perfect Byte Computer Center. It
alleged that defendants without authority or license copied, reproduced, distributed,
installed and/or loaded software programs owned by Microsoft into computer units sold
by them to their customers in violation of its intellectual property rights. It prayed for the
issuance of a writ of preliminary injunction to restrain and enjoin defendants from
illegally reproducing, selling and distributing unlicensed software programs. It also
applied for the issuance of an ex parte order for the seizure and impounding of relevant
evidence that can be or may be found at defendants' business premises.
On 26 December 2000 the Las Pias trial court set petitioner's prayer for a temporary
restraining order for hearing but at the same time denied its application for
an ex parte order ratiocinating that the Intellectual Property Code does not expressly
allow its issuance and that, in any case, the TRIPS (Trade-Related Aspects of
Intellectual Property Rights) AGREEMENT cannot prevail over it. The court a quo also
opined that petitioner's application partook of a search and seizure order available only
in criminal cases. Petitioner moved for reconsideration but the same was denied on 9
January 2001.
Issue:
Whether or not the court a quo gravely abused its discretion amounting to lack or excess
of jurisdiction when it ruled that the law does not allow an ex parte provisional remedy of
seizure and impounding of infringing evidence?

Ruling:
No. The quest for speedy justice should not be used as a devise to trample upon other
equally laudable policies of this Court. Petitioner's direct resort to this Court in the guise of
speedy justice was in utter disregard of the hierarchy of courts. We find no exceptional or
compelling reason not to observe the hierarchy of courts. Our pronouncement in People v.
Cuaresma is most instructive -

This Court's original jurisdiction to issue writs of certiorari is not exclusive. It is shared
by this Court with Regional Trial Courts and with the Court of Appeals. This concurrence of
jurisdiction is not, however, to be taken as according to parties seeking any of the writs an
absolute, unrestrained freedom of choice of the court to which application therefor will be
directed. There is after all a hierarchy of courts. A direct invocation of the Supreme Courts
original jurisdiction to issue these writs should be allowed only when there are special and
important reasons therefor, clearly and specifically set out in the petition. This is established
policy. It is a policy that is necessary to prevent inordinate demands upon the Court's time and
attention which are better devoted to those matters within its exclusive jurisdiction, and to
prevent further over-crowding of the Court's docket. Indeed, the removal of the restriction on
the jurisdiction of the Court of Appeals in this regard, supra - resulting from the deletion of
the qualifying phrase, "in aid of its appellate jurisdiction" - was evidently intended precisely
to relieve this Court pro tanto of the burden of dealing with applications for the extraordinary
writs which, but for the expansion of the Appellate Court's corresponding jurisdiction, would
have had to be filed with it.

The Court feels the need to reaffirm that policy at this time, and to enjoin strict
adherence thereto in the light of what it perceives to be a growing tendency on the part of
litigants and lawyers to have their applications for the so-called extraordinary writs, and
sometimes even their appeals, passed upon and adjudicated directly and immediately by the
highest tribunal of the land.

The Court therefore closes this decision with the declaration for the information and
guidance of all concerned, that it will not only continue to enforce the policy, but will require
a more strict observance thereof.

WHEREFORE, the instant petition is DISMISSED. The assailed order dated 26 December
2001 of the RTC-Br. 255, Las Pias City, which denied petitioner's application for anex
parte order for the seizure and impounding of relevant and infringing evidence as well as its
order dated 1 March 2001 denying reconsideration thereof is SUSTAINED. Costs against
petitioner.
SO ORDERED.
459. MANUEL CAMACHO, petitioner, vs. ATTY. JOVITO A. CORESIS, JR., Graft
Investigation Officer I and/or OFFICE OF THE OMBUDSMAN - MINDANAO, SIXTO O.
DALEON, AIDA AGULO, DESIDERIO ALABA, NORMA TECSON, and the BOARD OF
REGENTS of the UNIVERSITY OF SOUTHEASTERN PHILIPPINES; SECRETARY
RICARDO GLORIA, ASSISTANT SECRETARY RENO CAPINPIN of the Department of
Education, Culture and Sports (DECS), DR. EDMUNDO B. PRANTILLA, and NEDA
REGIONAL DIRECTOR SANTIAGO ENGINCO, respondents.

G.R. No. 134372

August 22, 2002

QUISUMBING, J.:

Facts:

Respondent, Dr. Sixto O. Daleon, is a Professor 6 and officer-in-charge of the Graduate


School of USP, with a salary grade of CS 29. The other respondents, Agulo, Tecson and Alaba,
are faculty members of said university. They enrolled under Dr. Daleon in the subject Ed.D. 317,
which is a Seminar in Curriculum Development, during the first semester of 1994-1995. At the
end of the semester, Dr. Daleon gave the three final passing grades of 1.0, 1.25 and 1.5,
respectively.[3] They were graded without requiring them to attend regular classes. Instead, Dr.
Daleon gave them a special program of self-study with reading materials, once a week tutorial
meetings, quizzes, and term papers.
Sometime in June 1995, several doctoral students complained to petitioner that during the
first semester of school year 1994-1995, there were ghost students in the Ed.D. 317 class of Dr.
Daleon. According to them, these ghost students, namely Agulo, Alaba and Tecson were given
passing grades despite their failure to attend classes.
On June 13, 1995, petitioner informed Dr. Daleon of the complaint. Petitioner requested the
latter to furnish him with photocopies of exams, term papers, and record of attendance of the
students involved. Dr. Daleon ignored the request.
On July 28, 1995, the matter was raised in a university council meeting where it was agreed
that the University President, Dr. Edmundo Prantilla, would create a committee to investigate the
complaint.
In a letter dated August 10, 1995, Dr. Daleon apologized for the delay in responding to
petitioners letter-request dated June 15, 1995. Dr. Daleon admitted that he made special
arrangements with Agulo, Alaba and Tecson regarding their course without petitioners approval.
Thereafter, petitioner wrote Dr. Prantilla recommending that Agulo, Tecson and Alaba be
required to attend regular classes in school year 1995-1996 and comply with the course
requirements in Ed.D. 317. Dr. Prantilla approved the recommendations. However, on December
1, 1995, Dr. Prantilla entertained the appeal of Agulo for the validation of the grades given by Dr.
Daleon to the three of them. On December 23, 1995, the Board of Regents passed its Resolution
No. 2432 Series of 1995, upholding the grade given by Dr. Daleon to Agulo.
Consequently, petitioner filed a Complaint-Affidavit against Dr. Daleon before the Office of
the Ombudsman-Mindanao. The complaint for gross incompetence, insubordination and
violation of R.A. 6770 was docketed as OMB-ADM-3-96-0132.
On May 28, 1996, petitioner submitted a Manifestation with Prayer, with a Supplement to
Complaint-Affidavit for Violation of R.A. 3019 and/or such other penal laws against Dr. Daleon,
Agulo, Alaba, Tecson and members of the USP Board of Regents, including Dr. Prantilla. On
July 24, 1996, the Office of the Ombudsman-Mindanao issued an order directing respondent
members of the Board of Regents and the committee created to hear Administrative Case No. 96-
602 to desist from conducting further proceedings thereon and to have the entire records of said
criminal complaint forwarded to the Office for possible consolidation with the administrative
complaint.
On June 3, 1997, a Resolution was issued by Atty. Jovito Coresis, Jr., graft investigator in
the Office of the Ombudsman-Mindanao, dismissing the administrative and criminal complaints
against respondents. Approved by Ombudsman Aniano Desierto.
Issue:
Whether or not public respondent Office of the Ombudsman-Mindanao, committed
grave abuse of discretion when it affirmed the impugned BOR resolution as it is contrary
to the University Code, violates due process and is based on self-serving hearsays?
Ruling:
A special civil action for certiorari under Rule 65 of the Rules of Court is an
extraordinary remedy for the correction of errors of jurisdiction. To invoke the Courts power of
judicial review under this Rule, it must first be shown that respondent tribunal, board or officer
exercising judicial or quasi- judicial functions has indeed acted without or in excess of its or his
jurisdiction, and that there is no appeal, or any plain, speedy and adequate remedy in the ordinary
course of law. Conversely, absent a showing of lack or excess of jurisdiction or grave abuse of
discretion amounting to lack or excess of jurisdiction, the acts of the respondents may not be
subjected to our review under Rule 65.
From the records, we find no valid ground nor cogent reason to hold that the respondent
Office had gravely abused its discretion in issuing the assailed Resolution dated June 3,
1997. We note that the conclusions in said resolution are based on substantial evidence easily
verifiable from the records. Well established is the principle that factual findings of
administrative agencies are generally accorded respect and even finality by this Court, provided
such findings are supported by substantial evidence, as in this case. Graft Investigation Officer I
Jovito A. Coresis, Jr., of said Office gave weight to the counter-affidavit of Dr. Daleon as
corroborated by the affidavit of Prof. Concesa P. Lagare, Professor 2 of the College of Education,
USP. These affidavits averred that during the graduate school orientation program sometime in
July 1995, the universitys Vice President for Academic Affairs, Dr. Luz D. Ancheta, declared that
special arrangements between a professor and a graduate student may be allowed on a case-to-
case basis. Dr. Ancheta made this statement in reply to Dr. Daleons query on the policy of USP
on attendance of graduate school students and whether Dr. Daleon could give grades to students
who do not attend classes. In her reply to Dr. Daleons query, the VPAA even cited her experience
when she pursued her doctoral course at UP Los Baos. According to Dr. Ancheta, she was given
a special arrangement by one of her professors. She added that she, too, had allowed the same
special arrangement for her students at the USP Graduate School.
Public respondent also anchored his decision on Article 140 of the University Code, which
provides that the rules on attendance of students shall be enforced in all classessubject to the
modification by the Dean in the case of graduate students and other courses. [16] It is undisputed
that at the time that Dr. Daleon handled the graduate class in Ed.D. 317, he had already been duly
designated Officer-In-Charge (OIC) of the Graduate School by the President of USP and was
even entitled to the emoluments inherent to the Office of the Dean of the Graduate School.
[17]
Accordingly, as OIC, performing the functions of the Dean of the Graduate School, Dr.
Daleon had the authority to modify the rule on attendance without seeking permission of
petitioner.
Further, Dr. Daleons teaching style had the support of the members of the Board of Regents,
the body with the authority to formulate university policies, fully knowing the policy on
attendance of students in the graduate school. In passing Resolution No. 2432, S. 1995,[18] not
only did they validate the grade given by Dr. Daleon to Agulo, but they also gave an imprimatur
on the propriety, regularity and acceptability of Dr. Daleons instructional approach. In said
resolution, the BOR cited Article 155 and Article 3 of the University Code, thus:
In our view, petitioner failed to establish that Dr. Daleon and the Board of Regents of the
University of Southeastern Philippines acted in evident bad faith or with manifest partiality in the
performance of their official duties. Hence, there is no basis to hold that the Office of the
Ombudsman-Mindanao committed any grave abuse of discretion in exonerating respondents
below from both administrative and criminal charges. The resolution of that Office is in order for
it accords with the facts and the law.
WHEREFORE, the instant petition is DISMISSED for lack of merit. The Resolution dated
June 3, 1997, of the Office of the Ombudsman- Mindanao is AFFIRMED.
SO ORDERED.
460. ROBERT DEL MAR, petitioner, vs. COURT OF APPEALS and NORMA
EBERSOLE DEL MAR, respondents.

G.R. No. 139008

March 13, 2002

PANGANIBAN, J.:

Facts:

The parcels of land covered by the land titles that are sought to be nullified are all owned
by [private] respondent NORMA EBERSOLE DEL MAR by way of inheritance from her lawful
[ascendants]. The original titles were all issued in her name and favor.

In the early 1970s [private] respondent together with her two children, GERALD and
FLORENCE went to the United States with the intent of obtaining domicile there[i]n and leaving
behind the other son petitioner, and entrusting [to] his [administration] their properties.

In 1974, [private respondent] came back to the Philippines and stayed up until 1978 and
thereafter went back to the US. During her stay, the properties were intact.

Sometime in 1996, [private respondent] discovered that the properties were already in the name
of [petitioner]. [Private respondent] protested because she never had done any act of transfer of
the properties in favor of [petitioner], because her intent was to have these properties to be
eventually divided into THREE (3) equal parts for her THREE (3) children The transfer was
[without] the knowledge of [private respondent]. It was fraudulent and unlawful

Private respondent also claims that petitioner had been duly served summons, but neither he
nor his counsel appeared for pretrial. Hence, petitioner was declared in default. While he did
receive the Order of Default, he never bothered to have it lifted. So, trial proceeded and
evidence ex parte for private respondent was received by the trial court.
Petitioner filed a Notice of Appeal. On January 7, 1998, Noel T. Tomas, legal researcher and
officer in charge of the Regional Trial Court (RTC) of Santiago City (Branch 35), forwarded to
the CA the records of Civil Case No. 35-2373. Buenaventura B. Miguel, chief of the Judicial
Records Division of the appellate court, thereafter wrote a letter dated August 13, 1998,
addressed to Atty. Federico Abuan Jr., counsel for petitioner, stating the following:
Pursuant to the resolution en banc of the Supreme Court, dated February 23, 1984, you are
hereby required to file with this court SEVEN (7) printed copies of the brief, or SEVEN (7)
eleven inches in leng[th] by eight and a half inches in width - commonly known letter size[,]
written double space, copies of said brief together with the proof of service of TWO (2) printed
typewritten or mimeographed copies hereof upon the appellee. The decision of Trial Court shall
be appended to the brief.

On December 8, 1998, Atty. Amado C. Vallejo Jr., counsel for private respondent, moved to
dismiss the appeal on the ground that petitioner had failed to file the required brief within the
reglementary period.
As already stated, the CA granted the Motion to Dismiss via the first assailed Resolution.

Issues:

Whether or not CA gravely abused its discretion in dismissing petitioners appeal for his
mere failure to file his Brief within the reglementary period? And that

Ruling:

No. Rule 50, Section 1(e) of the Revised Rules of Court, expressly authorizes the CA to
dismiss an appeal for, inter alia, failure of appellant to serve and file the required number of
copies of his brief or memorandum within the time provided by these Rules.
Certiorari as a special civil action can be availed of when the following requisites concur:
(a) a tribunal, board or officer exercising judicial functions has acted without or in excess of
jurisdiction or with grave abuse of discretion amounting to lack or in excess of jurisdiction; and
(b) there is no appeal or plain, speedy and adequate remedy in the ordinary course of law for
annulling or modifying the proceeding.
It is well-settled that the negligence of counsel binds the client. Exceptions to this rule arise
when (1) such negligence is so gross, palpable, reckless and inexcusable that the client is
deprived of the due process of law; and (2) the application of such due process results in the
outright deprivation of ones property through a technicality.
The negligence of Atty. Abuan does not fall under these exceptions. His negligence in this
case was his inexcusable failure to file the required appellants Brief, thus causing the dismissal
of the appeal of petitioner. But the latter was not without fault. He was aware of Atty. Abuans
failure to appear at the pretrial conference, a failure that had placed him in default. Because
petitioner was in default, private respondents evidence was received ex parte by the RTC. No
wonder, the trial court decided against him. Yet, he retained Atty. Abuans services for the appeal.
One is bound by the decisions of ones counsel regarding the conduct of the case, especially
where the former does not complain against the manner in which the latter handled the case.
Petitioner cannot be said to have been denied due process, because he was afforded the
opportunity to be heard. In fact, he filed an Answer to private respondents Complaint. That he
did not present evidence in his favor was the effect of his being in default and his continued
failure to move that such status be lifted. His claim that he was abroad is unavailing.
We cannot attribute grave abuse of discretion to the Court of Appeals which merely followed
Rule 50 in dismissing the appeal.
WHEREFORE, the Petition is DISMISSED. Costs against petitioner.
SO ORDERED.
461. PCGG vs. Silangan Investors and Managers Inc.

G.R. Nos. 167055-56

March 25, 2010

CARPIO, Acting C.J.:

Facts:

On 27 July 1987, PCGG filed before the Sandiganbayan a complaintfor reconveyance,


accounting and damages against Jose, Manuel H. Nieto, Jr. (Nieto, Jr.), Ferdinand E. Marcos,
Imelda R. Marcos, Ferdinand R. Marcos, Jr., Benedicto, Juan Ponce Enrile,
and Potenciano Ilusorio. The case was docketed as Civil Case No. 0009.
On 15 June 1988, PCGG issued writs of sequestration against Aerocom Investors and
Managers, Inc. (Aerocom) and Polygon, stating, By virtue of the authority vested in the
Commission, the above-named [companies are] hereby placed under sequestration, together with
all of the shares of stock, office premises, records, documents, assets and other properties
thereof.
On 3 November 1990, Benedicto and PCGG entered into a compromise agreement.
On 29 July 1991, PCGG filed before the Sandiganbayan a complaint for injunction and
damages against Victor, Jose, Nieto, Jr., and Juan De Ocampo.
On 1 August 1991, Jose, Nieto, Jr., Andres L. Africa, Aerocom, Polygon, Belgor Investment,
Inc., and Silangan filed before the Sandiganbayan a petition for certiorari and prohibition under
Rule 65 of the Rules of Court against PCGG. For this purpose, Silangan engaged the services of
M.M. Lazaro & Associates and agreed to pay 15% of the total amount it may recover as
contingent fee. The case was docketed as Civil Case No. 0127. The Sandiganbayan jointly heard
Civil Case Nos. 0126 and 0127.
In its 7 March 1994 Order, the Sandiganbayan issued a writ of execution of the 3
November 1990 compromise agreement.
In its 25 April 1994 Decision, the Sandiganbayan held that (1) the 15 June 1988 writs of
sequestration were void because the PCGG failed to commence judicial action within the
required six-month period; (2) the 11 April 1986 writ of sequestration was void because it was
signed by only one commissioner; and (3) the acts of PCGG in managing Oceanic were void.
PCGG filed a motio for reconsideration, dated 7 July 2004.
In its 23 December 2004 Joint Resolution, the Sandiganbayan denied PCGGs 7 July 2004
motion for reconsideration and granted Silangans 6 February 2004 omnibus motion.
Issues:
Whether or not the Sandiganbayan committed grave abuse of discretion when it ordered
the release of the cash dividends, with interest, to Silangan and Polygon because (1) the cash
dividends were under custodia legis, and (2) the acts of PCGG in managing Oceanic including
the declaration of cash dividends were void?

Ruling:
In petitions for certiorari under Rule 65 of the Rules of Court, petitioner must show that
respondent tribunal acted with grave abuse of discretion. In Angara v. Fedman Development
Corporation, the Court held that:

Certiorari under Rule 65 is a remedy narrow in scope and inflexible in


character. It is not a general utility tool in the legal workshop. It offers only a
limited form of review. Its principal function is to keep an inferior tribunal within
its jurisdiction. It can be invoked only for an error of jurisdiction, that is, one
where the act complained of was issued by the court, officer or a quasi-judicial
body without or in excess of jurisdiction, or with grave abuse of discretion which
is tantamount to lack or excess of jurisdiction.[43]

In Garcia, Jr. v. Court of Appeals, the Court defined grave abuse of discretion:

Grave abuse of discretion is defined as such capricious or whimsical exercise of


judgment equivalent to lack of jurisdiction. The abuse of discretion must
be so patent and gross as to amount to an evasion of a positive duty or a virtual
refusal to perform a duty enjoined by law, or to act at all in contemplation of law
as where the power is exercised in an arbitrary and despotic manner by reason of
passion or hostility

PCGG failed to show that the Sandiganbayan acted with grave abuse of
discretion. The Sandiganbayan correctly held that Silanganand Polygon were entitled to their
Oceanic cash dividends, with interest, because the declaration of cash dividends was
valid. PCGG declared the cash dividends before the Sandiganbayans 25 April 1994 Decision
came out. At that time, the 11 April 1986 and 15 June 1988 writs of sequestration were presumed
valid.

WHEREFORE, the petitions are DISMISSED. The Court AFFIRMS the 21 June 2004
Resolution and 23 December 2004 Joint Resolution of the Sandiganbayan, Third Division, in
Civil Case Nos. 0126 and 0127, and the 7 July 2005 and 25 October 2005 Resolutions of
the Sandiganbayan, Third Division, in Civil Case No. 0127. SO ORDERED.
462. Julies Franchise Corporation vs Ruiz

G.R. No. 180988

August 28, 2009

CARPIO, J.:

Facts:

On 28 July 1999, respondent Dancel, as franchisee, entered into two franchise


agreements with petitioner corporation, as franchiser, over the two bakeshop outlets located in
Rizal Avenue, Dipolog City and Sindangan, Zamboanga Del Norte. On 8 March 2000,
respondent Dancel entered into a third franchise agreement with petitioner corporation over the
bakeshop located on Balintawak Street, Dipolog City. In 2003, respondent Dancel decided to
renew the franchise agreements for the three Julies bakeshops. Three months before the
expiration of the franchise agreements, petitioner corporation evaluated the performance of the
three Julies bakeshops and the results were favorable. In 2004, respondent Dancel paid the
renewal fees for the next five years of the franchise agreements covering the three Julies
bakeshops. However, when respondent Dancel and his business partner Jose Rodion Uy
dissolved their business partnership, petitioner corporation informed respondent Dancel that it
was terminating the three franchise agreements and that the extended term of the franchises
would expire on 30 June 2005. Uy is the son-in-law of Rodrigo M. Gandionco, Sr., who was the
original owner of the trade name and business style Julies Bakeshop.[1]

On 22 June 2005, respondent Dancel filed against petitioner corporation a complaint for
Specific Performance with prayer for the issuance of a Writ of Preliminary Injunction or
Temporary Restraining Order before the trial court, docketed as Civil Case No. 6108. The trial
court denied respondent Dancels application for the issuance of a Writ of Preliminary Injunction
or Temporary Restraining Order for lack of jurisdiction. When the trial court denied his motion
for reconsideration, respondent Dancel filed a petition for certiorari with the Court of Appeals
which was docketed as CA-G.R. SP No. 00740. In January 2006, the Court of Appeals resolved
to grant the Temporary Restraining Order, effective for 60 days from notice, restraining or
enjoining petitioner corporation from terminating the franchise agreements. On 14 August 2006,
the Court of Appeals rendered a decision granting the petition.

Petitioner corporation filed a motion for reconsideration, which the Court of Appeals
denied. Petitioner corporation then filed with this Court a petition for review on certiorari. In a
Resolution dated 12 February 2007, this Court denied the petition for late filing since the petition
was filed beyond the reglementary period of 15 days.[5] Petitioner corporation twice moved for
reconsideration, which this Court denied.

Issue:
Whether or not the court committed grave abuse of discretion amounting to lack or
excess of jurisdiction in issuing the assiled writ of preliminary injunction to enjoin acts
committed or about to commit outside the trial courts territorial boundaries?

Ruling:
The special civil action for certiorari under Rule 65 is intended to correct
errors of jurisdiction or grave abuse of discretion amounting to lack or excess of
jurisdiction. The writ of certiorari is directed against a tribunal, board or officer
exercising judicial or quasi-judicial functions that acted without or in excess of its
or his jurisdiction or with grave abuse of discretion. Grave abuse of discretion
means such capricious or whimsical exercise of judgment which is equivalent to
lack of jurisdiction. To justify the issuance of the writ of certiorari, the abuse of
discretion must be grave, as when the power is exercised in an arbitrary
or despotic manner by reason of passion or personal hostility, and it must be so
patent and gross as to amount to an evasion of a positive duty or to a virtual refusal
to perform the duty enjoined, or to act at all, in contemplation of law, as to be
equivalent to having acted without jurisdiction.[13]
We find no grave abuse of discretion amounting to lack or excess of
jurisdiction on the part of the trial court, which merely issued the questioned Writ
of Preliminary Injunction in accordance with the decision of the Court of Appeals
which has already attained finality. The propriety of the issuance of the Writ of
Preliminary Injunction was already ruled upon by the Court of Appeals in its
Decision dated 14 August 2006 in CA-G.R. SP No. 00740. Such decision has
become final and executory after petitioner corporations appeal to this Court was
denied for being filed beyond the reglementary period.

Except to correct clerical errors, a judgment which has acquired finality can
no longer be modified in any respect even if the modification is meant to correct a
perceived erroneous conclusion of fact or law. There would be no end to litigation
if parties are allowed to relitigate issues which were already resolved with finality.

WHEREFORE, we DISMISS the petition.


SO ORDERED.
463. Vergara vs Ombudsman

G.R. No. 174567

March 12, 2009

CARPIO, J.:

Facts:

The City Council of Calamba (City Council), where petitioner was a member, issued Resolution
No. 115, Series of 2001 which authorized Mayor Lajara to negotiate with landowners within the vicinity
of Barangays Real, Halang, and Uno, for a new city hall site. During the public hearing, the choice for the
new city hall site was limited to properties owned by Pamana and a lot in Barangay Saimsin, Calamba.

The City Council then passed Resolution No. 280, Series of 2001, authorizing Mayor Lajara to purchase
several lots owned by Pamana with a total area of 55,190 square meters for the price of P129,017,600.
Mayor Lajara was also authorized to execute, sign and deliver the required documents.

The City Government of Calamba (Calamba City), through Mayor Lajara, entered into the
following agreements: MOA, Deed of Sale, Deed of Real Estate Mortgage and Deed of Assignment of
Internal Revenue Allotment (IRA).

The above documents were subsequently endorsed to the City Council. Petitioner, however,
alleged that all these documents were not ratified by the City Council, a fact duly noted by the
Commission on Audit.

The respondents justified the absence of ratification by the City Council of the MOA, Deed of
Sale, Deed of Mortgage, and Deed of Assignment. They cited Section 22 of Republic Act No. 7160 (RA
7160) which spoke of prior authority and not ratification. Respondents pointed out that petitioner did not
deny the fact that Mayor Lajara was given prior authority to negotiate and sign the subject contracts. In
fact, it was petitioner who made the motion to enact Resolution No. 280.

The Ombudsman explained that ratification by the City Council was not a condition sine qua non
for the local chief executive to enter into contracts on behalf of the city. The law requires prior
authorization from the City Council and in this case, Resolution Nos. 115 and 280 were the City
Councils stamps of approval and authority for Mayor Lajara to purchase the subject lots.

Aggrieved by the Ombudmans findings, petitioner elevated the case before this Court. Hence,
this petition.
Issue:
Whether all the documents pertaining to the purchase of the lots should bear the ratification by
the City Council of Calamba?

Ruling:

Petitioner contends that all the documents, like the Memorandum of Agreement, Deed of Sale,
Deed of Mortgage, and Deed of Assignment, do not bear the ratification by the City Council.

In the assailed Order, the Ombudsman held that the various actions performed by Mayor Lajara in
connection with the purchase of the lots were all authorized by the Sangguniang Panlungsod as
manifested in numerous resolutions. The lack of ratification alone does not characterize the purchase of
the properties as one that gave unwarranted benefits.

In its Memorandum submitted before this Court, the Ombudsman, through the Office of the
Solicitor General, pointed out that the ratification by the City Council is not a condition sine qua non for
the local chief executive to enter into contracts on behalf of the city. The law requires prior authorization
from the City Council and in this case, Resolution No. 280 is the City Councils stamp of approval and
authority for Mayor Lajara to purchase the subject lots.

Section 22(c), Title I of RA 7160, otherwise known as the Local Government Code of 1991,
provides:

Section 22. Corporate Powers. - x x x

(c) Unless otherwise provided in this Code, no contract may be entered into by
the local chief executive in behalf of the local government unit without prior
authorization by the sanggunian concerned. A legible copy of such contract shall be
posted at a conspicuous place in the provincial capitol or the city, municipal or barangay
hall. (Boldfacing and underscoring supplied)

Section 455, Title III of RA 7160 enumerates the powers, duties, and compensation of the Chief
Executive. Specifically, it states that :

Section 455. Chief Executive: Powers, Duties and Compensation. - xxx

(b) For efficient, effective and economical governance the purpose of which is
the general welfare of the city and its inhabitants pursuant to Section 16 of this Code, the
city mayor shall:

xxx

(vi) Represent the city in all its business transactions and sign in
its behalf all bonds, contracts, and obligations, and such other documents
upon authority of the sangguniang panlungsod or pursuant to law or
ordinance; (Boldfacing and underscoring supplied)
Clearly, when the local chief executive enters into contracts, the law speaks of prior authorization
or authority from the Sangguniang Panlungsod and not ratification. It cannot be denied that the City
Council issued Resolution No. 280 authorizing Mayor Lajara to purchase the subject lots.

As aptly pointed out by the Ombudsman, ratification by the City Council is not a
condition sine qua non for Mayor Lajara to enter into contracts. With the resolution issued by the
Sangguniang Panlungsod, it cannot be said that there was evident bad faith in purchasing the
subject lots. The lack of ratification alone does not characterize the purchase of the properties as
one that gave unwarranted benefits to Pamana or Prudential Bank or one that caused undue
injury to Calamba City.

WHEREFORE, we DISMISS the petition. We AFFIRM the Resolution and Order of


the Ombudsman in OMB-L-C-02-1205-L dated 17 March 2004 and 22 August 2005,
respectively. SO ORDERED.
464. Vda De Daffon vs Court of Appeals

G.R. No. 129017.

August 20, 2002

YNARES-SANTIAGO, J.:

Facts:

Petitioner Concepcion Villamor was married to the late Amado Daffon, with whom she
begot one son, Joselito Daffon. Joselito married Lourdes Osmea, and they bore six children,
namely, Aileen, Joselito Jr., Ana Vanesa, Leila, Julius and Suzette.
Amado passed away on January 21, 1982. His son, Joselito, died on October 25, 1990.
On January 21, 1994, respondents Lourdes Osmea Vda. De Daffon, together with her six
minor children, instituted an action for partition against petitioner Concepcion Villamor Vda. de
Daffon, which case was docketed as Civil Case No. DNA-281 of the Regional Trial Court of
Danao City, Branch 25. Respondents alleged that Amado left several real and personal properties
which formed part of his conjugal partnership with petitioner. Joselito being a forced heir of
Amado was entitled to at least one half of Amados estate, consisting of his share in the said
conjugal properties. However, the said properties were never partitioned between petitioner and
Joselito. After Joselitos death, petitioners behavior towards respondents, her daughter-in-law and
grandchildren, changed. She claimed absolute ownership over all the properties and deprived
them of the fruits thereof. Thus, respondents prayed that the conjugal properties of Amado
Daffon and petitioner be partitioned and that the one-half share of Amado be further partitioned
between petitioner, on one hand, and the respondents as heirs of Joselito Daffon, on the other
hand.
Petitioner filed a Motion to Dismiss on the grounds of (1) lack of jurisdiction over the
subject matter of the case; (2) failure of the complaint to state a cause of action; and (3) waiver,
abandonment and extinguishment of the obligation. She argued that the trial court cannot take
cognizance of the action for partition considering her claim of absolute ownership over the
properties; and that respondents themselves admitted that petitioner has repudiated the co-
ownership. Anent the third ground, petitioner alleged that Joselito Daffon filed a complaint
against Milagros Marin, who was likewise married to Amado Daffon, for recovery of a parcel of
land in MandaluyongIn said complaint, respondent Lourdes Osmea Vda. de Daffon allegedly
admitted that the land sought was the only property of the late Amado Daffon.
In an Order dated July 22, 1994, the trial court denied the Motion to Dismiss Petitioner filed
a motion for reconsideration which was also denied on September 23, 1994.
On October 25, 1994, petitioner filed a petition for certiorari with the Court of Appeals,
docketed as CA-G.R. SP No. 35536. On November 14, 1996, the Court of Appeals rendered the
assailed decision denying due course and dismissing the petition for certiorari. Petitioners motion
for reconsideration was denied in the Resolution dated April 21, 1997.
Issue:
Whether or not admitting the facts alleged to the court can render a valid
judgment upon the same in accordance with the prayer thereof?

Ruling:

It should be stressed that in the determination of whether a complaint fails to state a cause
of action, only the statements in the complaint may be properly considered Moreover, a
defendant who moves to dismiss the complaint on the ground of lack of cause of action
hypothetically admits all the averments thereof. The test of sufficiency of the facts found in a
complaint as constituting a cause of action is whether or not admitting the facts alleged the court
can render a valid judgment upon the same in accordance with the prayer thereof. The
hypothetical admission extends to the relevant and material facts well pleaded in the complaint
and inferences fairly deducible therefrom. Hence, if the allegations in the complaint furnish
sufficient basis by which the complaint can be maintained, the same should not be dismissed
regardless of the defense that may be assessed by the defendants

In the case at bar, the complaint sufficiently alleged that defendant (i.e., petitioner herein)
was married to Amado Quiros Daffon and that they begot an only son in Joselito DaffonThe
complaint further alleged that Joselito Daffon later got married to herein plaintiff Lourdes Osmea
and before the former died on October 25, 1990 he sired the six (6) children who are now
plaintiffs with their mother. This, to our mind, was sufficient allegation that Joselito Daffon was
a legitimate son of the spouses Amado and Concepcion Daffon; and that plaintiffs (i.e.,
respondents herein) were likewise legitimate heirs of Joselito Daffon. Admitting the truth of
these averments, there was, therefore, no need to inquire whether respondent minor children
were duly acknowledged by the deceased Amado Daffon. To be sure, the illegitimacy of the said
children and the lack of acknowledgment are matters which petitioner may raise as a defense in
her answer and threshed out by the court during a full-blown trial.

In the same vein, there is no need for the complaint to specifically allege respondents
claim of co-ownership of the properties. The complaint needs only to allege the ultimate facts on
which the plaintiffs rely for their claim

The rules of procedure require that the complaint must make a concise statement of the
ultimate facts or the essential facts constituting the plaintiffs cause of action. A fact is essential if
it cannot be stricken out without leaving the statement of the cause of action inadequate. A
complaint states a cause of action only when it has its three indispensable elements, namely: (1)
a right in favor of the plaintiff by whatever means and under whatever law it arises or is created;
(2) an obligation on the part of the named defendant to respect or not to violate such right; and
(3) an act or omission on the part of such defendant violative of the right of plaintiff or
constituting a breach of the obligation of defendant to the plaintiff for which the latter may
maintain an action for recovery of damages.

WHEREFORE, in view of the foregoing, the instant petition is DENIED. The decision of the
Court of Appeals in CA-G.R. SP No. 35536 is AFFIRMED. SO ORDERED.
465. Gabriel L. Duero vs. CA and Bernardo A. Eradel
G.R. No. 131282
January 4, 2002

QUISUMBING, J.:

Facts :

1988 According to petitioner, private respondent occupied petitioners land in Baras, San
Miguel, Surigao del Sur, with an assessed value of P5,240. Despite repeated demands,
respondent refused to vacate the land.
June 16, 1995 Petitioner filed before the RTC a complaint for Recovery of Possession and
Ownership against private respondent and Apolinario and Inocencio Ruena.
Meanwhile, petitioner and the Ruenas entered into a compromise agreement whereby the
latter bound themselves to recognize and respect petitioners ownership. Respondent was not
a party thereto.
January 12, 1996 Partial judgment was rendered by RTC on the basis of the compromise
agreement. Respondent was declared in default for failure to file his answer.
February 13, 1996 Petitioner presented his evidence ex-parte.
May 8, 1996 Judgment was rendered in favor of the petitioner, copy of which was received
by respondent on May 25, 1996.
June 10, 1996 Respondent filed a Motion for New Trial, alleging that he has been
occupying the land as a tenant of Artemio Laurente, Sr., and that he turned over the summons
to Laurente in the honest belief that the latter had a better right to the land and was
responsible to defend any adverse claim on it. RTC denied the motion.
Meanwhile, an administrative case between petitioner and the Laurentes remained pending
before the DENR regional office.
July 24, 1996 Respondent filed before the RTC a Petition for Relief from Judgment,
reiterating the same allegation in his motion. He also averred that he cannot be made to
vacate the land pending determination of who owned the land, and that the judgment is void
because the indispensable heirs of Laurente were not impleaded.
September 24, 1996 The grandchildren on Laurente filed a Motion for Intervention, but the
same was denied by RTC.
October 8, 1996 RTC denied the Petition for Relief from Judgment.
In a Motion for Reconsideration, respondent alleged that RTC had no jurisdiction since the
value of the land was only P5,240. RTC denied the Motion.
January 22, 1997 Petitioner filed a Motion for Execution, which was granted on January
28.
February 27, 1997 Writ of Execution was issued by RTC.
March 12, 1997 Respondent filed a petition for certiorari before the CA.
CA declared the judgment of RTC null and void for lack of jurisdiction.
Issue:

Whether or not the CA gravely abused its discretion when it held that the MTC had
jurisdiction, and that private respondent was not stopped from assailing the jurisdiction of the
RTC after he had filed several motions before it

Ruling:

Respondent is not estopped from questioning the jurisdiction of the RTC. While participation
in all stages of a case before the trial court, including invocation of its authority in asking for
affirmative relief, effectively bars a party by estoppel from challenging the court's jurisdiction,
estoppel has become an equitable defense that is both substantive and remedial and its successful
invocation can bar a right and not merely its equitable enforcement. For estoppel to apply, the
action giving rise thereto must be unequivocal and intentional because, if misapplied, estoppel
may become a tool of injustice.

Under the circumstances, we could not fault the Court of Appeals in overruling the RTC and
in holding that private respondent was not estopped from questioning the jurisdiction of the RTC.
The fundamental rule is that, the lack of jurisdiction of the court over an action cannot be waived
by the parties, or even cured by their silence, acquiescence or even by their express
consent. Further, a party may assail the jurisdiction of the court over the action at any stage of
the proceedings and even on appeal. Even if private respondent actively participated in the
proceedings before said court, the doctrine of estoppel cannot still be properly invoked against
him because the question of lack of jurisdiction may be raised at anytime and at any stage of the
action.

Estoppel must be applied only in exceptional cases, as its misapplication could result in a
miscarriage of justice. This farmer, who is now the private respondent, ought not to be penalized
when he claims that he made an honest mistake when he initially submitted his motions before
the RTC, before he realized that the controversy was outside the RTC's cognizance but within the
jurisdiction of the MTC. To hold him in estoppel as the RTC did would amount to foreclosing his
avenue to obtain a proper resolution of his case. Furthermore, if the RTC's order were to be
sustained, he would be evicted from the land prematurely, while RED Conflict Case No.1029
would remain unresolved. Such eviction on a technicality if allowed could result in an injustice,
if it is later found that he has a legal right to till the land he now occupies as tenant-lessee.

WHEREFORE, the petition is DISMISSED. The assailed decision of the Court of Appeals is
AFFIRMED. The decision of the Regional Trial Court in Civil Case No. 1075 entitled Gabriel L.
Duero vs. Bernardo Eradel, its Order that private respondent turn over the disputed land to
petitioner, and the Writ of Execution it issued, are ANNULLED and SET ASIDE. Costs against
petitioner.

SO ORDERED.
466. ELADIO DILLENA petitioner, vs. COURT OF APPEALS and AURORA CARREON,
respondents.
G.R. No. 77660
July 28, 1988

BIDIN, J.:

Facts:

Spouses Dolores Sebastian and Rufino Carreon died on March 7, 1974 and August 21,
1974, in Quezon City and Manila, respectively, leaving an adopted daughter Aurora Carreon,
private respondent herein. On October 21, 1974, Fausta Carreon Herrera, sister of the deceased
Rufino Carreon instituted Sp. Proc. No. Q-19378 entitled "In the Matter of the Intestate Estate of
the Deceased Spouses Rufino B. Carreon and Dolores Sebastian Petition for Letters of
Administration" before the then CFI, Branch XXXI, Quezon City. On November 7, 1974, the
said court appointed Fausta Carreon Herrera as Special Administratrix only for the purpose of
receiving and collecting all sums of money due and payable to the estate, in addition to the
powers and duties provided for under Section 2, Rule 80 of the Rules of Court.

On October 3, 1975, private respondent executed an Extra-Judicial Settlement of the


Estate of the deceased spouses, adjudicating to herself all the real properties of the said spouses.

Meanwhile, on November 8, 1978, private respondent, while being the administratrix of


the estate, executed an extrajudicial adjudication of the three (3) fishpond properties of the
deceased spouses in Hagonoy, Bulacan. By virtue of said extrajudicial adjudication, Transfer
Certificates of Title Nos. 140243, 140244 and 140245 in the names of the deceased spouses were
cancelled and in lieu thereof, Transfer Certificates of Title were issued in the name of private
respondent.

On November 13, 1978, private respondent sold in favor of petitioner the three fishponds
in question without the knowledge and approval of the probate court.

The aforesaid vendees were duly furnished with copies of the order dated September 22,
1981. Only Starlight Industries, Co., Inc. appeared on October 23, 1981. Again, the vendees were
required to submit their respective explanations and the hearing on the incident was re-set to
November 11, 1981. Petitioner was again duly served with a copy of said order.

At the scheduled hearing, Starlight Industries Co., Inc. submitted an explanation, thus, the
sale in its favor was approved and confirmed by the probate court. However, vendees Luisa S.
Rodriguez and petitioner Eladio Dillena neither appeared at the scheduled hearing nor submitted
their explanations as to why the sales in their favor should not be cancelled for having been
executed without court approval.

On August 10, 1984, acting on the claim of Atty. Eugenio Balatbat for attorney's fees on
account of his legal services rendered to private respondent and to the estate, the probate court
approved the payment of said fees to be paid out of the properties of the estate. The same was
ordered annotated as a lien on the transfer certificates of title of the real properties of the estate,
including those properties transferred by private respondent without court approval.

On September 13, 1984, the lower court, on motion of Atty. Balatbat for a definitive
ruling as to the validity of the sale made by administratrix-private respondent to Luisa S.
Rodriguez and petitioner, declared that the transfers in favor of the aforesaid vendees are null and
void and without force and effect for having been made without court authority and approval.
Petitioner was served with a copy of the said order on December 13, 1984.

On July 25, 1985, or after seven (7) months from the time the order of September 13,
1984 was received by petitioner, the latter filed a petition before the probate court in the same
Sp. Proc No. Q-19378 by way of special appearance alleging that said court, in view of its
limited jurisdiction as a probate court, has no power to annul the sale of the fishponds in
question; that the orders annulling the sale are void because he is not a party to Sp. Proc. No. Q-
19378; that the lower court has no jurisdiction over the res, which are located in Bulacan
province.

After hearing the petition and the opposition therein, the lower court, on October 28,
1985, denied the petition and ordered petitioner to return physical possession of the fishponds to
private respondent. Petitioner sought reconsideration of the aforesaid order which was denied.

On February 20, 1986, a petition for certiorari was instituted by petitioner before the
respondent Court of Appeals and as earlier mentioned, the said court, on November 14, 1986,
dismissed the petition. Petitioner's motion for reconsideration was likewise denied on March 2,
1987; hence, this petition.

Issue:

Whether or not the probate court, in view of its limited jurisdiction, cannot declare as null
and void, the sale of the questioned properties?

Ruling:

This pronouncement finds support in the previous case of Dolores Vda. de Gil vs. Agustin
Cancio (14 SCRA 797) wherein We emphasized that it is within the jurisdiction of a probate
court to approve the sale of properties of a deceased person by his prospective heirs before final
adjudication. Consequently, it is error to say that this matter should be threshed out in a separate
action.

It being settled that property under administration needs the approval of the probate court before
it can be disposed of, any unauthorized disposition does not bind the estate and is null and void.
As early as 1921 in the case of Godoy vs. Orellano (42 Phil. 347), We laid down the rule that a
sale by an administrator of property of the deceased, which is not authorized by the probate court
is null and void and title does not pass to the purchaser.
There is hardly any doubt that the probate court can declare null and void the disposition
of the property under administration, made by private respondent, the same having been effected
without authority from the said court. It is the probate court that has the power to authorize
and/or approve the sale (Sections 4 and 7, Rule 89), hence, a fortiori, it is said court that can
declare it null and void for as long as the proceedings had not been closed or terminated. To
uphold petitioner's contention that the probate court cannot annul the unauthorized sale, would
render meaningless the power pertaining to the said court. Sales of properties under
administration which do not comply with the requisites under sections 4 and 7 of Rule 89 are
null and void (Bonaga vs. Soler, 2 SCRA 755)

WHEREFORE, the petition is DISMISSED and the assailed decision is hereby AFFIRMED.
467. REMEDIOS VELASCO VDA. DE CALDITO, petitioner, vs. HON. ROSALIO C.
SEGUNDO, ETC., ET AL., respondents.
G.R. No. L-58187
September 30, 1982

Facts:

The complaint was filed on April 10, 1980. The private respondent moved to dismiss the
complaint on the ground that the cause of action is barred by the statute of limitations. In an
Order dated September 29, 1980, the respondent Judge sustained the said contention and ordered
the dismissal of the case. It was reasoned out that the action, being based on quasi delict, the
same prescribed in four (4) years in accordance with Article 1146 of the Civil Code; and the
action having been instituted after more than seven (7) years from the date of the incident, the
same is already barred by the statute of limitations.

Although the order of dismissal was issued since April 11, 1980, it was not until December 17,
1981 that the petitioner instituted this proceeding before the Supreme Court in order to secure a
declaration of its nullity. No explanation was given for the undue delay in seeking the
nullification of the order of dismissal complained of. The petition alleges that the said order of
dismissal is null and void for being contrary to law inasmuch as the proper period of prescription
is ten (10) years and not four (4) years, the acting being based on a contract of carriage and not
quasi-delict. Mention is also made that the respondent judge showed his partiality by
commenting in open court that he considered this case as one of pure harassment, and by
manifesting a "too friendly alliance with defendant's counsel."

Issue:
Whether or not petitioner is correct in filing a petition for certiorari as substitute for
appeal?

Ruling:

The questioned order of dismissal is appealable and the proper remedy should have been
to appeal the same. No circumstance had been shown to explain why such procedure was not
observed, nor to justify a deviation from the same as to make available a petition for certiorari in
lieu of taking an appropriate appeal. As may be noted, the petition was filed almost one (1) year
after the issuance of the order of dismissal complained of. Even in situations wherein certiorari is
allowed as a remedy in lieu of appeal, said period may not be considered as a reasonable time
within which to avail of such a remedy. Moreover, the imputed error to the challenged order is
not jurisdictional but merely one of judgment which is not correctible by certiorari.

WHEREFORE, the petition is hereby DENIED, without costs.

SO ORDERED.