Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION

G.R. No. 138258 January 18, 2002

EDDIE HERRERA, ERNESTO T. TIJING, and CONRADO BOLLOS, petitioners,

vs.
TEODORA BOLLOS and RICO GO, respondents.

Courts; Actions; Jurisdictions; Forcible Entry and Unlawful Detainer; Jurisdiction of the court over the
subject matter of the action is determined by the allegations of the complaint, irrespective of whether or
not the plaintiff is entitled to recover upon all or some of the claims asserted therein.—Resolving the first
issue, we emphasize the basic rule that jurisdiction of the court over the subject matter of the action is
determined by the allegations of the complaint at the time of its filing, irrespective of whether or not the
plaintiff is entitled to recover upon all or some of the claims asserted therein. “What determines the
jurisdiction of the court is the nature of the action pleaded as appearing from the allegations in the
complaint. The averments therein and the character of the relief sought are the ones to be consulted.

Same; Same; Same; Same; Damages; The concept of damages in an action for forcible entry and detainer
cases mean “rents” or “reasonable compensation for the use and occupation of the premises,” “fair
rental value of the property.”—On the second issue, the concept of damages in an action for forcible
entry and detainer cases is well defined in several cases. These damages mean “rents” or “the reasonable
compensation for the use and occupation of the premises,” or “fair rental value of the property.”
Temperate, actual, moral and exemplary are neither rents nor reasonable compensation for the use and
occupation of the premises, nor fair rental value, and are not recoverable in such cases.

Same; Same; Same; Same; Same; Before taking judicial notice, the court must “allow the parties to be
heard thereon.” Hence, there can be no judicial notice on rental value of the premises in question without
supporting evidence.—In the case at bar, the municipal trial court dismissed the case for lack of
jurisdiction, and the regional trial court reversed the dismissal but rendered judgment ejecting the
defendants from the parcel of land involved, and condemning them to pay damages and attorney’s fees.
This is not correct. In case of reversal, the case shall be remanded to the municipal trial court for further
proceedings. The regional trial court in reversing an appealed case dismissing the action cannot decree the
eviction of the defendants and award damages. A court cannot take judicial notice of a factual matter in
controversy. The court may take judicial notice of matters of public knowledge, or which are capable of
unquestionable demonstration, or ought to be known to judges because of their judicial functions. Before
taking such judicial notice, the court must “allow the parties to be heard thereon.” Hence, there can be no
judicial notice on the rental value of the premises in question without supporting evidence.

PETITION for review on certiorari of a decision of the Court of Appeals.

PARDO, J.:

The Case

The case is a petition for review on certiorari of the decision of the Court of Appeals1 affirming
that of the Regional Trial Court, Branch 44, Dumaguete City, which reversed the ruling of the
municipal trial court that it has jurisdiction over the case of forcible entry.
The Facts

The facts, as found by the Court of Appeals, are as follows:

"Ab initio, on August 5, 1993, Teodora Bollos commenced before the Municipal Circuit
Trial Court of Bayawan-Basay Civil Case No. 993, for forcible entry, solely against Eddie
Herrera alleging that the latter, sometime in the second week of 1993, through stealth
and strategy and taking advantage of the absence of Teodora, entered and occupied her
Sugarland known as Lot No. 20, GSS-615, located at Camandagan, Maninyon,
Bayawan, Negros Oriental. Teodora claims to have inherited said parcel, being the only
heir, from her deceased father, Alfonso Bollos, who died on December 10, 1992.

"Defendant, Eddie Herrera, denied the allegations against him maintaining that he
entered and occupied not Lot No. 20, as claimed by Teodora, but Lot No. 21, GSS-615,
which is owned by Conrado Bollos, a brother of Teodora’s father, Alfonso. Further,
Herrera said that his occupation of the property was not through stealth or strategy but
by virtue of a contract of lease executed between Conrado Bollos, as lessor, and
Ernesto Tijing, as lessee. Herrera is Tijing’s overseer on the land.

"As a consequence, the complaint was twice amended, first, on March 23, 1994 to
include Ernesto T. Tijing as a party-defendant and much later on October 4, 1995, this
time to implead Conrado Bollos as an additional defendant.

"After due proceedings, the first level court rendered its judgment dispositively ruling:

‘ACCORDINGLY, in the light of the foregoing considerations for plaintiffs’ failure

to make-out a forcible entry case because of lack of jurisdiction the above-
entitled case is hereby DISMISSED. Plaintiffs’ remedy should be reivendicatory
(sic) action before the proper forum.

‘SO ORDERED.

‘Given this 30th day of June, 1997, at Bayawan, Negros Oriental, Philippines.

'(SGD.) RUDY T. ENRIQUEZ

'Circuit Judge'

‘(p. 11, MCTC Decision; p. 69, Rollo)

"On Appeal to the Regional Trial Court of Dumaguete City, docketed as Civil Case No.
12014, the challenged verdict was reversed in a Decision dated October 21, 1997, the
decretal portion reads:

‘WHEREFORE, as prayed for by plaintiffs-appellants, judgment is hereby

rendered restoring Lot No. 20, GSS-615 to the plaintiffs and ejecting the
defendants from the said parcel of land. Defendants-appellees are condemned to
solidarily pay plaintiffs-appellants the following:

'Actual – P50,000.00;
Damages
'Moral – P25,000.00
Damages
 'Attorney's – P 5,000.00
Fees

‘Reasonable rental/month from the date of this judgment of P2,000.00 and to pay
the costs.

‘SO ORDERED.

‘GIVEN this 21st day of October, 1997, in the City of Dumaguete, Philippines.

'(SGD.) ALVIN L. TAN

'Judge'

‘(p. 13, RTC Decision; p. 27, Rollo)’2

On March 12, 1998, petitioners filed with the Court of Appeals a petition for review assailing the
ruling of the regional trial court.3

On December 18, 1998, the Court of Appeals promulgated a decision, the dispositive portion of
which reads:
"IN VIEW OF THE FOREGOING, the appealed decision is hereby affirmed, except that
the award of actual and moral damages therein contained are deleted. No
pronouncement as to costs.

"SO ORDERED."4

On February 1, 1999, petitioners filed with the Court of Appeals a motion for reconsideration of
the above-cited decision.5

On March 8, 1999, the Court of Appeals denied the motion.6

Hence, this appeal.7

The Issues

The issues raised are:

(a) Is the municipal trial court vested with jurisdiction over a second amended complaint
impleading a new defendant filed beyond one year from dispossession alleging a case of
forcible entry in the original action?

(b) May the regional trial court award moral and exemplary damages against defendants
in an appeal from a dismissal of the case for forcible entry by the lower court?8

The Court’s Ruling

We deny the petition.

Resolving the first issue, we emphasize the basic rule that jurisdiction of the court over the
subject matter of the action is determined by the allegations of the complaint at the time of its
filing, irrespective of whether or not the plaintiff is entitled to recover upon all or some of the
claims asserted therein.9 "What determines the jurisdiction of the court is the nature of the
action pleaded as appearing from the allegations in the complaint. The averments therein and
the character of the relief sought are the ones to be consulted."10

In the case at bar, plaintiffs’ complaint, both original and amended, contains sufficient
allegations constituting an action for forcible entry, as clearly alleged in paragraphs 4 and 5 of
the complaint, to wit:

"4. That plaintiffs and even their predecessor-in-interest Alfonso Bollos were in peaceful,
adverse, continuous possession of the property and in concepto de dueno until the
commission of the act or acts of dispossession or deprivation by the defendant
hereinafter mentioned.

"5. That sometime in the second week of June, 1993, defendant pursuant to an
avaricious intent of enriching himself at the expense of the plaintiffs, through stealth and
strategy, and taking advantage of the absence of the latter, entered and occupied the
property in question and without any legal justification therefore, fertilized the sugar cane
rations growing thereon and planted the vacant portions with sugar cane.11

Thus, we find that the complaint alleged prior physical possession de facto which the
defendants disturbed by force, intimidation, threat, strategy or stealth, against the will or without
the consent of the plaintiffs, sufficient to constitute a cause of action for forcible entry.

In fact, defendants admitted the truth of the foregoing facts in their answer and first amended
answer. The thrust of their defense was that they had occupied Lot No. 21, not Lot No. 20,
which is the land in question.

On the second issue, the concept of damages in an action for forcible entry and detainer cases
is well defined in several cases.12 These damages mean "rents" or "the reasonable
compensation for the use and occupation of the premises," or "fair rental value of the
property."13 Temperate, actual, moral and exemplary are neither rents nor reasonable
compensation for the use and occupation of the premises, nor fair rental value, and are not
recoverable in such cases.14

In the case at bar, the municipal trial court dismissed the case for lack of jurisdiction, and the
regional trial court reversed the dismissal but rendered judgment ejecting the defendants from
the parcel of land involved, and condemning them to pay damages and attorney’s fees. This is
not correct. In case of reversal, the case shall be remanded to the municipal trial court for
further proceedings.15 The regional trial court in reversing an appealed case dismissing the
action cannot decree the eviction of the defendants and award damages. A court cannot take
judicial notice of a factual matter in controversy. The court may take judicial notice of matters of
public knowledge, or which are capable of unquestionable demonstration, or ought to be known
to judges because of their judicial functions.16 Before taking such judicial notice, the court must
"allow the parties to be heard thereon."17 Hence, there can be no judicial notice on the rental
value of the premises in question without supporting evidence.

The Judgment

IN VIEW WHEREOF, the Court DENIES the petition. However, the Court SETS ASIDE the
decisions of the Court of Appeals18 and the Regional Trial Court.19 The Court remands the case
to the municipal trial court for further proceedings.
No costs.

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION

G.R. No. 133750 November 29, 1999

APEX MINING, INC., ENGR. PANFILO FRIAS and ENGR. REY DIONISIO, petitioners,
vs.
HON. COURT OF APPEALS, HON. PEDRO CASIA, as Judge of Branch 2, Tagum, Davao
del Norte, MIGUEL BAGAIPO, ALFREDO ROA, EDGAR BARERA, BONIFACIO BARIUS,
JR., FRANCISCO BELLO and LEOPOLDO CAGATIN, respondents.

Remedial Law; Appeals; Perfection of an appeal in the manner and within the period laid down by law is
not only mandatory but also jurisdictional.—Perfection of an appeal in the manner and within the period
laid down by law is not only mandatory but also jurisdictional, and that the failure to perfect an appeal as
required by the rules has the effect of defeating the right of appeal of a party and precluding the appellate
court from acquiring jurisdiction over the case.

Same; Judgment; Two grounds by which a judgment may be annulled.—A judgment can be annulled only
on two grounds: (1) lack of jurisdiction and (2) extrinsic fraud. Fraud is regarded as extrinsic or collateral
where it has prevented a party from having a trial or from presenting all of his case to the court. It is the
kind of fraud which denied the party the opportunity to fully litigate upon the trial all the rights or
defenses he was entitled to assert.

Same; Same; Same; Recognized exceptions to the rule that the negligence of counsel binds the client.—It
is settled that the negligence of counsel binds the client. This is based on the rule that any act performed
by a counsel within the scope of his general or implied authority is regarded as an act of his client.
Consequently, the mistake or negligence of counsel may result in the rendition of an unfavorable
judgment against the client. However, the application of the general rule to a given case should be looked
into and adopted according to the surrounding circumstances obtaining. Thus, exceptions to the foregoing
have been recognized by the court in cases where reckless or gross negligence of counsel deprives the
client of due process of law, or when its application will result in outright deprivation of the client’s
liberty or property or where the interests of justice so require, and accord relief to the client who suffered
by reason of the lawyer’s gross or palpable mistake or negligence.

Same; Same; Same; A client may reasonably expect that his counsel will make good his representations
and has the right to expect that his lawyer will protect his interests during the trial of his case.—A client
may reasonably expect that his counsel will make good his representations and has the right to expect that
his lawyer will protect his interests during the trial of his case. For the general employment of an attorney
to prosecute or defend a case or proceeding ordinarily vests in a plaintiff’s attorney the implied authority
to take all steps or do all acts necessary or incidental to the regular and orderly prosecution and
management of the suit, and in a defendant’s attorney, the power to take such steps as he deems necessary
to defend the suit and protect the interests of the defendant.

Same; Same; Same; Where counsel is guilty of gross ignorance, negligence and dereliction of duty, which
resulted in the client’s being held liable for damages in a damage suit, the client is deprived of his day in
court and the judgment may be set aside on such ground.—If the incompetence, ignorance or
inexperience of counsel is so great and the error committed as a result thereof is so serious that the client,
who otherwise has a good cause, is prejudiced and denied his day in court, the litigation may be reopened
to give the client another chance to present his case. Similarly, when an unsuccessful party has been
prevented from fully and fairly presenting his case as a result of his lawyer’s professional delinquency or
infidelity the litigation may be reopened to allow the party to present his side. Where counsel is guilty of
gross ignorance, negligence and dereliction of duty, which resulted in the client’s being held liable for
damages in a damage suit, the client is deprived of his day in court and the judgment may be set aside on
such ground.

Same; Same; Same; In cases involving gross or palpable negligence of counsel the courts must step in
and accord relief to a client who has suffered thereby.—What should guide judicial action is that a party
be given the fullest opportunity to establish the merits of his action or defense rather than for him to lose
life, liberty, honor or property on mere technicalities. In cases involving gross or palpable negligence of
counsel the courts must step in and accord relief to a client who has suffered thereby. This Court will
always be disposed to grant relief to parties aggrieved by perfidy, fraud, reckless inattention and
downright incompetence of lawyers, which has the consequence of depriving their clients, of their day in
court.

PETITION for review on certiorari of a decision of the Court of Appeals.

DAVIDE, JR., C.J.:

This appeal by certiorari of the decision 1 of the Court of Appeals dated 30 April 1993 and its
Resolution 2 dated 7 May 1998 in CA-G.R. SP No. 39872 raised the issue of whether the
negligence of counsel can justify annulment of judgment.

The present petition stemmed from a complaint for damages filed on 9 December 1987 by
herein private respondents, Miguel Bagaipo, Alfredo Roa, Edgar Barrera, Bonifacio Baruis, Jr.,
Francisco Bello, and Leopoldo I. Cagatin, against herein petitioners Apex Mining Corporation
(hereafter APEX) and/or Engr. Panfilo Frias and Engr. Rey Dionisio before the Regional Trial
Court of Davao del Norte. The case was raffled to Branch 11 of Tagum, 11th Judicial Regional
and was docketed as Civil Case No. 2131. The complaint alleged in substance that sometime in
November 1987, the bulldozer owned by APEX, due to its negligence, damaged private
respondents mining claim known as Tunnel T-45, thereby putting a stop to private respondents'
mining operations. 3

Petitioners through their retained counsel filed an answer denying the material allegations in the
complaint and alleging that the claims of private respondents were without factual and legal
bases since they constructed the tunnel within the mining claim area of APEX without any
authority from or approval of the latter. 4
During trial on the merits, plaintiffs (private respondents herein) presented three witnesses who
were cross-examined by the petitioners' retained law firm through Atty. Gerardo C. Olaguer, a
partner of the firm. After private respondents rested their case, petitioners' counsel filed a
demurrer to evidence, which was denied by the trial court in its order of 23 June 1992. In the
same order the trial court set the reception of evidence for the defendants (herein petitioners) on
18 February 1993. Notice of the order was received by petitioners' counsel; however, when the
case was called on 18 February 1993, petitioners' counsel did not appear. On motion of the
plaintiffs, the trial court issued an order declaring defendants to have waived their right to
present evidence in their defense.

Despite due notice of the order, counsel for petitioners did not move for reconsideration of the
order.

On 24 June 1993, the trial court rendered a decision finding APEX liable for damages but
absolving the other defendants. The dispositive portion thereof reads:

From the evidence presented by the plaintiffs which has not been disputed as no
evidence was presented by the defendant, judgment is hereby rendered in favor of the
plaintiffs and against defendant Apex Mining Corporation ordering the latter as follows:

1. To pay the plaintiffs the amount of P100,000.00 representing expenses that

will be incurred by the plaintiffs in the rehabilitation of Tunnel No. 45;

2. To pay the plaintiffs the unearned income equivalent to P72,000.00 a day from
November 14, 1987 until Tunnel No. 45 shall have been completely rehabilitated;

3. To pay P5,000.00 representing expenses in the preparation of the complaint

and P10,000.00 attorney's fee; and

4. To pay the costs.

5
Given this 24th day of June 1993 at Tagum Davao, Philippines.

Counsel for the petitioners appealed from the decision to the Court of Appeals. 6 The appeal
was entered as CA-G.R. CV No. UDK-7265. However, it was subsequently dismissed by the
Court of Appeals in its Resolution 7 of 13 May 1994 for failure to pay the docket fees within the
reglementary period. Again, despite due notice, counsel for petitioners did not move for
reconsideration of the dismissal of the appeal. Accordingly, the resolution of 13 May 1994
became final, and entry of judgment 8 was made on August 10, 1994. Again petitioner's counsel
was duly notified of the entry of judgment.

The case was remanded to the court of origin and upon motion of private respondents, a writ of
execution 9 was issued on 15 February 1995. However, it appearing that APEX was in a joint
venture with Base Metals Mineral Resources Corporation under a Memorandum of Agreement,
the trial court issued on 7 September 1995 an order 10 directing the Base Metals Mineral
Resources Corporation, through its officers, to turn over to the clerk of court and/or the sheriff all
money and machineries due in favor of APEX, by reason of said Memorandum of Agreement.
Upon its receipt of said order sometime in December 1995, Base Metals Mineral Resources
Corporation informed APEX about the same. Thereafter, APEX confronted its retained counsel
about the matter and it was only then that APEX learned that its appeal of the judgment against
it in Civil Case No. 2131 had been dismissed by the Court of Appeals.
On 26 February 1996, APEX and/or Engr. Panfilo Frias and Engr. Rey Dionisio, through their
new counsel, filed a Petition for Annulment of Judgment with application for the issuance of a
writ of preliminary injunction and/or temporary restraining order before the Court of Appeals.
Petitioners contended that the actuation of their former counsel constituted professional
chicanery amounting to extrinsic or collateral fraud properly warranting the annulment of the
judgment of the trial court and that by reason of said actuation of their former counsel they have
been unduly deprived of their right to be heard and to due process of law through no fault of
their own.

On 2 February 1996, the Court of Appeals issued a temporary restraining order. On 8 March
1996, a hearing on the application for preliminary injunction was conducted wherein the vice-
president of APEX testified not only on the propriety of the issuance of the injunction but also on
the alleged "sell-out" and gross negligence of their former counsel. On the said hearing, pieces
of documentary evidence were marked and formally offered. 11

On 13 March 1998, private respondents filed an answer wherein they argued that the petition for
annulment should be dismissed because it is not the proper remedy, that the grounds invoked
do not warrant the annulment of the challenged decision, and that petitioners are guilty of forum-
shopping. 12

On 21 March 1996, the Court of Appeals granted the issuance of the writ of preliminary
injunction. 13 Thereafter, the case was set for preliminary conference pursuant to Sec. 1 (c),
Rule 6 of the Revised Internal Rules of the Court of Appeals. 14 At the preliminary conference,
attorneys for both parties expounded on their respective positions. Respondents marked and
offered in evidence four court certifications and official receipt. The parties also agreed to file
simultaneous memoranda within 20 days from 10 May 1996. The parties also informed the
Court that they were open to an amicable settlement so the Court of Appeals granted them an
additional 20 days within to submit their compromise agreement, if one is reached. Otherwise,
the petition for annulment shall be deemed submitted for decision. 15

The parties failed to reach a compromise agreement; hence, they filed their respective
memoranda.

On 30 April 1997, the Court of Appeals rendered a decision 16 dismissing the petition for
annulment of judgment on the ground that it has no jurisdiction to annul or set aside its own
decision and that petitioners are bound by the negligence, mistake or lack of competence of
their counsel. The Court of Appeals also dissolved the writ of preliminary injunction previously
issued. A timely motion for reconsideration was filed by petitioners but was likewise denied by
the Court of Appeals in its Resolution 17 of 7 May 1998, wherein it ruled that:

. . . . Suffice it to repeat that generally, a client will suffer the consequences of the
negligence, mistake or lack of competence of his counsel. But where a party was given
every opportunity to present his evidence and to pursue appeal from the adverse
judgment but counsel's negligence resulted in the loss of said appeal, the defeated party
cannot raise the alleged gross negligence of his counsel resulting in the denial of due
process to warrant the reversal of the lower court's decision. In the first place, the
neglect or failure of counsel to inform his client of an adverse judgment resulting in the
loss of his right to appeal will not justify setting aside a judgment that is valid and regular
on its face (Mayuga vs. Court of Appeals, 261 SCRA 309, 317-318, citing Tuason v.
Court of Appeals, G.R. No. 116607, April 10, 16 and other cases). Secondly, there would
 be no end to litigation if. this was allowed as every error of counsel could be the subject
of challenge by the client through another counsel who, if he is also found wanting,
would likewise be disowned by the same client through another counsel, and so
on ad infinitum. There would be no end to litigation since court proceedings would be
subject to reopening at any time by the mere subterfuge of replacing counsel. 18

Petitioners are now before us reiterating the same arguments they raised before the Court of
Appeals. They contended that the Court of Appeals erred in disregarding the significant and
uncontroverted acts of petitioners' counsel amounting to a "sell-out" of his clients' interest which
are sufficient reasons to annul the adverse decision of the trial court, to wit:

1. he failed to inform his clients, herein petitioners of the scheduled hearing for reception
of their evidence, despite due notice to him, precluding the submission of their evidence
which would have disproved the material allegations in plaintiffs' complaints;

2. he failed to attend the scheduled hearing for reception of petitioners' evidence for
which reason the case was deemed submitted for decision without this evidence;

3. he never bothered to verify what transpired at the hearing he failed to attend, and
thus, was not able to file the necessary pleadings to lift the order considering the case
submitted for decision without petitioners' evidence;

4. after receiving the court a quo's adverse decision awarding in toto everything plaintiffs
prayed for in their complaint, he did not notify or inform his clients, herein petitioners,
opting to appeal the said decision to the Court of Appeals without prior consultation with
them;

5. he did not pay the docketing fees to perfect his appeal for which reason the
undocketed appeal was dismissed by the Court of Appeals;

6. after receiving the Resolution of the Court of Appeals dismissing his appeal, he did
not file a motion to reinstate the dismissed appeal with a tender of the unpaid docketing
fees;

7. he hid from the petitioners the dismissal by the Court of appeals of his Appeal,
resulting in the Entry of Judgment on 10 August 1994;

8. when his law firm submitted a progress report to petitioner APEX on the status of the
case handled by the firm, it was misrepresented that the instant case was "still pending
on appeal with the Court of Appeals" when as of the date the report was submitted, the
appeal had already been dismissed fifteen (15) months earlier; and

9. when asked on 17 October 1995 for the second time the status of the instant case, a
partner of the law firm assured APEX (thru it Makati City corporate lawyer) that the case
was still pending resolution and that the company will be advised accordingly of
whatever developments, stressing that the more urgent cases are those which have
been decided with finality and that the case is not one that merits Apex's immediate
concern and attention. 19

At the outset, error was committed by the Court of Appeals in holding that it has no jurisdiction
over the petition for annulment. It is clear under Section 9 (2) of the Batas Pambansa Blg. 129
(now Rule 47 of the 1997 Rules of Civil Procedure) that exclusive original jurisdiction over
actions for annulment of judgment of the decision of the Regional Trial Courts is vested on the
Court of Appeals. The fact that petitioners appealed the decision of the Regional Trial Court of
Davao del Norte in Civil Case No. 2131 with the Court of Appeals is immaterial. The said appeal
was dismissed for non-payment of docket fees within the reglementary period. An appeal is not
deemed perfected if the appellate court's docket fee is not fully paid. 20

It follows then that the Court of Appeals did not acquire appellate jurisdiction over the decision
of the trial court.

On the merit, we are persuaded by petitioners' contention.

A judgment can be annulled only on two grounds: (1) lack of jurisdiction and (2) extrinsic
fraud. 22 Fraud is regarded as extrinsic or collateral where it has prevented a party from having a
trial or from presenting all of his case to the court. 23 It is the kind of fraud which denied the party
the opportunity to fully litigate upon the trial all the rights or defenses he was entitled to assert. 24

It is settled that the negligence of counsel binds the client. This is based on the rule that any act
performed by a counsel within the scope of his general or implied authority is regarded as an act
of his client. Consequently, the mistake or negligence of counsel may result in the rendition of
an unfavorable judgment against the client. 25However, the application of the general rule to a
given case should be looked into and adopted according to the surrounding circumstances
obtaining. Thus, exceptions to the foregoing have been recognized by the court in cases where
reckless or gross negligence of counsel deprives the client of due process of law, 26 or when its
application will result in outright deprivation of the client's liberty or property or where the
interests of justice so require, and accord relief to the client who suffered by reason of the
lawyer's gross or palpable mistake or negligence. 27

The instant case falls within the exception. Petitioners' counsel is in guilty of gross negligence in
handling their case before the trial court. Records show that petitioners' former counsel did not
attend the scheduled hearing for the reception of the evidence for the defense despite due
notice. The law firm did not even bother to inform its client of the scheduled hearing, as a result
of which both counsel and petitioners were unable to attend the same. Worse, after the trial
court issued an order declaring defendants [petitioners herein] as having waived their right to
present evidence, their counsel did not take steps to have the same set aside. Although after a
decision against APEX was rendered by the trial court, petitioners' counsel was able to file a
timely notice of appeal. However, it failed to pay the docket fee and refused to do so despite
repeated notice to pay was given by the Court of Appeals, by reason of which the appeal was
dismissed. The situation was further aggravated by the fact that no action was taken by the
counsel on the said dismissal, thereby allowing it to become final and executory.

Petitioners cannot be faulted in not inquiring into the records and status of the case. They
expected that their counsel would amply protect their interest since they were their retained
counsel which handled a majority, if not all of the cases of petitioners, including the case subject
of this petition. 28

A client may reasonably expect that his counsel will make good his representations and has the
right to expect that his lawyer will protect his interests during the trial of his case. For the
general employment of an attorney to prosecute or defend a case or proceeding ordinarily vests
in a plaintiff's attorney the implied authority to take all steps or do all acts necessary or
incidental to the regular and orderly prosecution and management of the suit, and in a
defendant's attorney, the power to take such steps as he deems necessary to defend the suit
and protect the interests of the defendant. 29

Further, there is ample showing that petitioners' previous counsel misrepresented to the former
about the true status of the damage suit filed by herein private respondents. They were made to
believe, per the Progress Report submitted by the said Law Firm, that Civil Case 2131 was still
pending on appeal with the Court of Appeals when in truth, the appeal has already been
dismissed sixteen months ago. 30

The foregoing incompetence or negligence of petitioners' counsel is so great which prevented

them from fairly presenting their defense as interposed in the answer that they could not be
liable for damages, considering that the plaintiffs' tunnel was constructed within the claim area
of the petitioners without permission, and that the award of P72,000 a day by the trial court is
excessive and without basis since the tunnel's daily production was of low grade ore and was
practically nil due to the hardness of the vein materials and excessive flow of water aggravated
by the withdrawal of plaintiff's financier of his generator and water pumps. 31

If the incompetence, ignorance or inexperience of counsel is so great and the error committed
as a result thereof is so serious that the client, who otherwise has a good cause, is prejudiced
and denied his day in court, the litigation may be reopened to give the client another chance to
present his case. 32 Similarly, when an unsuccessful party has been prevented from fully and
fairly presenting his case as a result of his lawyer's professional delinquency or infidelity the
litigation may be reopened to allow the party to present his side. 33 Where counsel is guilty of
gross ignorance, negligence and dereliction of duty, which resulted in the client's being held
liable for damages in a damage suit, the client is deprived of his day in court and the judgment
may be set aside on such ground. 34

In view of the foregoing circumstances, higher interests of justice and equity demand that
petitioners be allowed to present evidence on their defense. Petitioners may not be made to
suffer for the lawyer's mistakes and should be afforded another opportunity, at least, to
introduce evidence on their behalf. To cling to the general rule in this case is only to condone
rather than rectify a serious injustice to a party whose only fault was to repose his faith and
entrust his innocence to his previous lawyers. 35

What should guide judicial action is that a party be given the fullest opportunity to establish the
merits of his action or defense rather than for him to lose life, liberty, honor or property on mere
technicalities. 36 In cases involving gross or palpable negligence of counsel the courts must step
in and accord relief to a client who has suffered thereby. 37This Court will always be disposed to
grant relief to parties aggrieved by perfidy, fraud, reckless inattention and downright
incompetence of lawyers, which has the consequence of depriving their clients, of their day in
court. 38

WHEREFORE, the petition is GRANTED. The questioned decision and resolution of the Court
of Appeals in CA-G.R.-S.P. No. 39872 are hereby SET ASIDE. The decision of the trial court in
Civil Case No. 2131 and the writ of execution and the Order dated 7 September 1998 issued
pursuant thereto are hereby ANNULLED.

The Regional Trial Court of Davao del Norte, Branch II is hereby directed to REOPEN Civil
Case No. 2131, for the reception of evidence for the defendants (petitioners herein), and of
rebuttal and sur rebuttal evidence if warranted, and as the case may be, and to dispose of the
case with reasonable dispatch.
No pronouncement as to costs.

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION

G.R. No. 110929 January 20, 2000

SPS. ABELARDO & CONCHITA LOPEZ, and SPS. ANTONIO & CONCHITA
MANANSALA, petitioners,
vs.
COURT OF APPEALS and ROBERTO VALLARTA, respondents.

Remedial Law; Injunction; Injunction is not a cause of action in itself but merely a provisional remedy,
an adjunct to a main suit; Two requisites are necessary if a preliminary injunction is to issue.—
Generally, injunction is a preservative remedy for the protection of one’s substantive right or interest. It is
not a cause of action in itself but merely a provisional remedy, an adjunct to a main suit. It is resorted to
only when there is a pressing necessity to avoid injurious consequences which cannot be remedied under
any standard compensation. The application of the injunctive writ rests upon the existence of an
emergency or of a special reason before the main case can be regularly heard. The essential conditions for
granting such temporary injunctive relief are that the complaint alleges facts which appear to be sufficient
to constitute a proper basis for injunction and that on the entire showing from the contending parties, the
injunction is reasonably necessary to protect the legal rights of the plaintiff pending the litigation. Two
requisites are necessary if a preliminary injunction is to issue, namely, the existence of a right to be
protected and the facts against which the injunction is to be directed are violative of said right. In
particular, for a writ of preliminary injunction to issue, the existence of the right and the violation must
appear in the allegation of the complaint and a preliminary injunction is proper only when the plaintiff
(private respondent herein) appears to be entitled to the relief demanded in his complaint.

Same; Same; Evidence; The assessment and evaluation of evidence in the issuance of the writ of
preliminary injunction involves findings of facts.—It is worth stressing too that the assessment and
evaluation of evidence in the issuance of the writ of preliminary injunction involves findings of facts
ordinarily left to the trial court for its conclusive determination.

Same; Same; Same; Conclusions and findings of fact by the trial court are entitled to great weight and
should not be disturbed on appeal, unless strong and cogent reasons dictate otherwise.—We have time
and again ruled that conclusions and findings of fact by the trial court are entitled to great weight and
should not be disturbed on appeal, unless strong and cogent reasons dictate otherwise. This is because the
trial court is in a better position to examine the real evidence, as well as to observe the demeanor of the
witnesses while testifying in the case.

PETITION for review on certiorari of a decision of the Court of Appeals.

BUENA, J.:

This petition for review on certiorari assails the decision,1 dated March 29, 1993, of the Court of
Appeals which denied due course and dismissed CA-G.R. SP. No. 30072, in effect affirming the
Orders dated December 29, 19922 and January 14, 19933 of the Regional Trial Court of
Macabebe, Pampanga, Branch 54, (1) granting the issuance of a mandatory injunction requiring
the petitioners to surrender the fishpond, subject of the complaint, to private respondent; and (2)
allowing private respondent to harvest the contents thereof, respectively.

The present controversy traces its roots to the complaint for recovery of possession, damages
and injunction, filed by private respondent against petitioners. The complaint alleges, inter alia:
that respondent had been in actual, peaceful and lawful possession of Lots 3305, 3329, 3331
and 3324 with a combined area of 57 hectares, situated at sitio Teracan, Consuelo, Macabebe,
Pampanga, except for the short interruption in 1981 until October 17, 1981; that on June 2,
1981, respondent filed a fishpond application for lease agreement covering Lots No. 3324, 3329
and 3331 covering 40,1449 hectares; that on July 22, 1981, the Minister of Natural Resources
declared a portion of Masantol, Pampanga, containing an area of 4,574.8 hectares, including
the area applied for by private respondent as alienable and disposable for fishpond
development; that on July 13, 1988, the Department of Agriculture, Regional Office No. III, San
Fernando, Pampanga, issued a report of inspection declaring respondent and one Guil Rivera in
actual possession of their respective fishpond areas and have fully developed the same since
1976; that on October 17, 1990, petitioners unlawfully entered and occupied 34 hectares of the
respondent's fishpond ejecting him from the same. Respondent prays that he be restored
possession of the lots in question and that a preliminary injunction be issued to maintain
the status quo.4
Traversing respondent's allegations, petitioners contend that they have been in actual physical
and peaceful possession of the land since time immemorial; that in 1976 petitioners and private
respondent entered into an agreement whereby the latter will provide capital for the
development of the fishpond while petitioners labor and management, the income to be divided
between them; that the relationship went on smoothly until 1981 when they were ejected from
the premises by one Marcelino Marcos; that they filed an ejectment complaint before the courts;
that the Supreme Court in a decision promulgated on June 30, 1987 in G.R. No. 74957 upheld
their possession; that sometime in April 1990, petitioners were physically ejected from the land
by respondent but returned to the land on August 17, 1990; that since October 17, 1990 up to
the filing of the complaint, respondent has been harassing them with threats and arson.5

A hearing on the application for preliminary injunction was held on December 29, 1992 with
private respondent presenting his evidence. The petitioners did not present any testimonial
evidence and adopted respondent's exhibit as their own evidence.

Based on the evidence presented, the trial court on December 29, 1992 granted respondent's
prayer for injunction as contained in its Order the decretal portion of which reads:

WHEREFORE, upon all the foregoing consideration and circumstances, a preliminary

mandatory injunction is hereby issued against the defendants Abelardo Lopez, Conchita
Lopez, Antonio Manansala and Conchita Manansala and/or other persons acting for and
in their behalf directing them to surrender possession, control, occupancy and
administration of the fishpond in question and to refrain in any manner from molesting
the plaintiff, his agent or representatives in the peaceful possession of the fishpond in
question.

This order shall not be effective unless the plaintiff files with the Clerk of this Court a
bond executed to the defendants to the effect that plaintiff will pay to such parties such
damages which may be sustained by reason of this injunction if the Court should finally
decide that the plaintiff is not entitled thereto in the amount of P100,000.00.

SO ORDERED.

Petitioners moved for the inhibition of the presiding judge which was granted by the court on
January 7, 1993.6

On January 8, 1993, pursuant to the trial court's order, a writ of preliminary mandatory injunction
was issued.7

Thereafter, private respondent filed a motion to allow him to harvest the contents of the fishpond
and to deposit the proceeds of the sale after the harvest, which was granted on January 14,
1993. The trial court's order disposed as follows:
After going over the two motions referred to above, the court hereby orders: 1. Allowing
the harvest of the contents of the fishpond by the personnel of this court with a
representative of the plaintiffs and defendants observing; 2. To deposit to the court the
proceeds of the sale after the harvest; . . .8

Petitioners assailed the aforesaid orders before the Court of Appeals which dismissed the
same. The motion for reconsideration was likewise denied on July 5, 1993.
Petitioners now come to this Court arguing that the issuance of the writ of preliminary
mandatory injunction ordering them to surrender the possession and control of the fishpond
effectively transferred the possession thereof from petitioner to private respondent in violation of
the settled jurisprudence that injunction cannot be used or resorted to, to take possession of the
property from one person to another. Petitioners likewise assert that the issuance of the writ of
preliminary mandatory injunction and placing the private respondent in possession of the
disputed lot virtually resolved the issue of possession and disposed of the main case without
hearing on the merits, leaving no issue for the trial court to decide save that of damages.

The petition should be denied.

Generally, injunction is a preservative remedy for the protection of one's substantive right or
interest. It is not a cause of action in itself but merely a provisional remedy, an adjunct to a main
suit. It is resorted to only when there is a pressing necessity to avoid injurious consequences
which cannot be remedied under any standard compensation. The application of the injunctive
writ rests upon the existence of an emergency or of a special reason before the main case can
be regularly heard. The essential conditions for granting such temporary injunctive relief are that
the complaint alleges facts which appear to be sufficient to constitute a proper basis for
injunction and that on the entire showing from the contending parties, the injunction is
reasonably necessary to protect the legal rights of the plaintiff pending the litigation. 9 Two
requisites are necessary if a preliminary injunction is to issue, namely, the existence of a right to
be protected and the facts against which the injunction is to be directed are violative of said
right.10 In particular, for a writ of preliminary injunction to issue, the existence of the right and the
violation must appear in the allegation of the complaint and a preliminary injunction is proper
only when the plaintiff (private respondent herein) appears to be entitled to the relief demanded
in his complaint.11

In the case at bar, private respondent has sufficiently established his right over the subject
fishpond. The evidence presented by the private respondent during the hearing for the issuance
of the preliminary injunction, consisting of the following:

1. Exhibits A, B, C, D, E, F and its submarkings to show that petitioners Abelardo Lopez

and Antonio Manansala are fishpond guards of private respondent;

2. Exhibit G — a document from then Ministry of Natural Resources, Bureau of Forest

Development showing that the land in dispute is an alienable and disposable land of the
public domain suitable for fishpond development;

3. Exhibit H — application for Lease Agreement with the Bureau of Fisheries and
Aquatic Resources (BFAR) in favor of private respondent;

4. Exhibit I — official receipts proving that respondent paid the corresponding lease
rentals to the BFAR for the lots in question

5. Exhibit J — Order dated February 7, 1991 of the BFAR recognizing the possession of
respondent and Gil Rivera over the lots in question and the payment of the lease rentals.
It further states that the possession of the lots and the development thereof into a
fishpond by respondent is recognized by the said bureau and that all persons/group
other than the applicants are deemed illegal;

6. Exhibit K — shows the possession of the four lots;

 7. Exhibit L — statement of Antonio Manansala, Armando Garcia and Abelardo Lopez
establishing that Manansala and Abelardo are fishpond guards;

8. Exhibit M — complaint filed by respondent and Antonio Manansala and Abelardo

Lopez, for ejectment which recognizes the fact that Manansala and Lopez are fishpond
guards;

9. Exhibit N — respondent has obtained a writ of preliminary injunction by virtue of which

he was placed back in possession over the property in question;

10. Exhibit O — shows that a preliminary, prohibitory and mandatory injunction was
issued in Civil Case No. 73-0383-M before then Court of First Instance of Pampanga
enjoining the harvesting of the milkfish, introducing and planting bangus fry and ordering
that respondent be restored into the possession of the properties in question;

11. Exhibit P — is a decision of the Supreme Court dated June 30, 1987 recognizing the
rights of possession of the respondent and petitioners and that respondent was the one
who developed the lots in question which was originally a swamp land to make it suitable
for fishpond purposes;

12. Exhibits Q, R — to establish the fact that petitioners received certain amounts from
the respondent as salary for their services as fishpond guards;

13. Exhibits S, T, and U — complaints against respondent showing that several cases
against him were filed by petitioners;

14. Exhibit V — to show that petitioners were in possession of a portion of the properties
in question claiming that they are the rightful possessors of the said area.12

undoubtedly show private respondent's legal right to possess the subject fishpond. The
evidence reveals that the land in dispute is covered by an Application for Lease Agreement with
the Bureau of Fisheries and Aquatic Resources in favor of herein private respondent; that
private respondent paid the lease rentals thereof; that the Bureau of Fisheries recognized his
possession over the lot in question and that all other persons and/or group of persons other
than the applicants are deemed illegal. It also discloses that petitioners are only fishpond guards
of the private respondent. No evidence was introduced by the petitioners to refute such claim
and merely adopted the evidence introduced by the private respondent.

Based on the evidences thus presented, we find the issuance of the writ of preliminary
injunction to be proper.

It is worth stressing too that the assessment and evaluation of evidence in the issuance of the
writ of preliminary injunction involves findings of facts ordinarily left to the trial court for its
conclusive determination.

We have time and again ruled that conclusions and findings of fact by the trial court are entitled
to great weight and should not be disturbed on appeal, unless strong and cogent reasons
dictate otherwise. This is because the trial court is in a better position to examine the real
evidence, as well as to observe the demeanor of the witnesses while testifying in the case.13
In this case, we find no justifiable reason or exception sufficient to deviate from this settled rule.

WHEREFORE, the petition is hereby DENIED for lack of merit.

SO ORDERED.