Dumaguete Cathedral Credit Cooperative vs.

Commissioner of Internal Revenue

Dumaguete Cathedral Credit Cooperative vs. Commissioner of
Internal Revenue
[G.R. No. 182722, January 22, 2010]

Doctrines:
Cooperatives are not required to withhold taxes on interest from savings
and time deposits of their members.

To encourage the formation of cooperatives and to create an atmosphere

conducive to their growth and development, the State extends all forms of
assistance to them, one of which is providing cooperatives a preferential tax
treatment.

Although the tax exemption only mentions cooperatives, this should be

construed to include the members. It must be emphasized that cooperatives
exist for the benefit of their members. In fact, the primary objective of every
cooperative is to provide goods and services to its members to enable them to
attain increased income, savings, investments, and productivity. Therefore,
limiting the application of the tax exemption to cooperatives would go against
the very purpose of a credit cooperative. Extending the exemption to members
of cooperatives, on the other hand, would be consistent with the intent of the
legislature.

Facts:
Petitioner Dumaguete Cathedral Credit Cooperative (DCCCO) is a credit
cooperative duly registered with and regulated by the Cooperative Development
Authority (CDA). On November 27, 2001, the Bureau of Internal Revenue (BIR)
Operations Group Deputy Commissioner, Lilian B. Hefti, issued Letters of
Authority Nos. 63222 and 63223, authorizing BIR officers to examine
petitioners books of accounts and other accounting records for all internal
revenue taxes for the taxable years 1999 and 2000.

On October 16, 2002, petitioner received two other Pre-Assessment Notices for
deficiency withholding taxes also for taxable years 1999 and 2000.[10] The
deficiency withholding taxes cover the payments of the honorarium of the Board
of Directors, security and janitorial services, legal and professional fees, and
interest on savings and time deposits of its members.

On October 22, 2002, petitioner informed BIR Regional Director Sonia L. Flores
that it would only pay the deficiency withholding taxes corresponding to the
honorarium of the Board of Directors, security and janitorial services, legal and
professional fees for the year 1999 in the amount of P87,977.86, excluding
penalties and interest.

On November 29, 2002, petitioner availed of the VAAP and paid the amounts of
P105,574.62 and P143,867.24. corresponding to the withholding taxes on the
payments for the compensation, honorarium of the Board of Directors, security

1
 and janitorial services, and legal and professional services, for the years 1999
and 2000, respectively.

On April 24, 2003, petitioner received from the BIR Regional Director Flores,
Letters of Demand ordering petitioner to pay the deficiency withholding taxes,
inclusive of penalties, for the years 1999 and 2000 in the amounts of
P1,489,065.30 and P1,462,644.90, respectively.

Issue: Whether or not it is liable to pay the deficiency withholding taxes on

interest from savings and time deposits of its members for the taxable years
1999 and 2000, as well as the delinquency interest of 20% per annum.

Held: Petitioners invocation of BIR Ruling No. 551-888, reiterated in BIR

Ruling [DA-591-2006], is proper. On November 16, 1988, the BIR declared in
BIR Ruling No. 551-888 that cooperatives are not required to withhold taxes on
interest from savings and time deposits of their members.

According to the CTA En Banc, the BIR Ruling was based on the premise that
the savings and time deposits were placed by the members of the cooperative in
the bank. Consequently, it ruled that the BIR Ruling does not apply when the
deposits are maintained in the cooperative such as the instant case.

There is nothing in the ruling to suggest that it applies only when deposits are
maintained in a bank. Rather, the ruling clearly states, without any
qualification, that since interest from any Philippine currency bank deposit and
yield or any other monetary benefit from deposit substitutes are paid by banks,
cooperatives are not required to withhold the corresponding tax on the interest
from savings and time deposits of their members.

In BIR Ruling [DA-591-2006] dated October 5, 2006 the BIR opined that:

xxxx

3. Exemption of interest income on members deposit (over and above the share capital
holdings) from the 20% Final Withholding Tax.

The National Internal Revenue Code states that a final tax at the rate of twenty
percent (20%) is hereby imposed upon the amount of interest on currency bank
deposit and yield or any other monetary benefit from the deposit substitutes and from
trust funds and similar arrangement x x x for individuals under Section 24(B)(1) and
for domestic corporations under Section 27(D)(1). Considering the members deposits
with the cooperatives are not currency bank deposits nor deposit substitutes, Section
24(B)(1) and Section 27(D)(1), therefore, do not apply to members of cooperatives and to
deposits of primaries with federations, respectively.

In this case, BIR Ruling No. 551-888 and BIR Ruling [DA-591-2006] are
in perfect harmony with the Constitution and the laws they seek to implement.
Accordingly, the interpretation in BIR Ruling No. 551-888 that cooperatives are
not required to withhold the corresponding tax on the interest from savings and

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time deposits of their members, which was reiterated in BIR Ruling [DA-591-
2006], applies to the instant case.

Members of cooperatives deserve a preferential tax treatment pursuant to

RA 6938, as amended by RA 9520.
Given that petitioner is a credit cooperative duly registered with the
Cooperative Development Authority (CDA), Section 24(B)(1) of the NIRC must be
read together with RA 6938, as amended by RA 9520. Under Article 2 of RA
6938, as amended by RA 9520, Thus, to encourage the formation of
cooperatives and to create an atmosphere conducive to their growth and
development, the State extends all forms of assistance to them, one of which is
providing cooperatives a preferential tax treatment.

The legislative intent to give cooperatives a preferential tax treatment is

apparent in Articles 61 and 62 of RA 6938, which read:

ART. 61. Tax Treatment of Cooperatives. Duly registered cooperatives under this Code
which do not transact any business with non-members or the general public shall not
be subject to any government taxes and fees imposed under the Internal Revenue
Laws and other tax laws. Cooperatives not falling under this article shall be governed
by the succeeding section.

ART. 62. Tax and Other Exemptions. Cooperatives transacting business with both
members and nonmembers shall not be subject to tax on their transactions to
members. Notwithstanding the provision of any law or regulation to the contrary,
such cooperatives dealing with nonmembers shall enjoy the following tax exemptions;
x x x.

This exemption extends to members of cooperatives. It must be emphasized

that cooperatives exist for the benefit of their members. In fact, the primary objective
of every cooperative is to provide goods and services to its members to enable them to
attain increased income, savings, investments and productivity. Therefore, limiting the
application of the tax exemption to cooperatives would go against the very purpose of
a credit cooperative. Extending the exemption to members of cooperatives, on the
other hand, would be consistent with the intent of the legislature. Thus, although the
tax exemption only mentions cooperatives, this should be construed to include the
members, pursuant to Article 126 of RA 6938, which provides:

ART. 126. Interpretation and Construction. In case of doubt as to the meaning of any
provision of this Code or the regulations issued in pursuance thereof, the same shall
be resolved liberally in favor of the cooperatives and their members.

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 All told, we hold that petitioner is not liable to pay the assessed deficiency
withholding taxes on interest from the savings and time deposits of its members, as
well as the delinquency interest of 20% per annum.

In closing, cooperatives, including their members, deserve a preferential tax treatment

because of the vital role they play in the attainment of economic development and
social justice. Thus, although taxes are the lifeblood of the government, the States
power to tax must give way to foster the creation and growth of cooperatives. To
borrow the words of Justice Isagani A. Cruz: The power of taxation, while
indispensable, is not absolute and may be subordinated to the demands of social
justice.
Posted by Atty. Glenn Rey Anino at 1:56 AM No comments:
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Labels: Del Castillo Cases

Buada vs. Cement Center Inc.

Bienvenido Buada et. al., vs. Cement Center, Inc.
[G.R. No. 180374, January 22, 2010]

Doctrines:
In all contractual, property or other relations, when one of the parties is
at a disadvantage on account of his moral dependence, ignorance, indigence,
mental weakness, tender age or other handicap, the courts must be vigilant for
his protection.

Voluntary surrender, as a mode of extinguishment of tenancy relations,

does not require any court authorization considering that it involves the
tenant's own volition. The voluntary surrender of the landholding by an
agricultural lessee should be due to circumstances more advantageous to him
and his family.

Facts:
Petitioners were tenant-farmers cultivating three parcels of agricultural
land owned by respondent Cement Center, Inc.

On March 13, 1998, respondent filed a Complaint for Confirmation of

Voluntary Surrender and Damages against petitioners with the Department of
Agrarian Reform Adjudication Board, Pangasinan. It claimed that on June 28,
1995, petitioners entered into a Compromise Agreement with respondent
whereby the former, for and in consideration of the sum of P3,000.00 each,
voluntarily surrendered their respective landholdings. However, despite
respondents repeated demands, petitioners refused to vacate subject
landholdings.

In their Answer, petitioners alleged that their consent to the Compromise

Agreement was obtained through fraud, deceit, and misrepresentation. They

4
claimed that sometime in 1995, respondent induced them to sign a
Compromise Agreement by representing that the subject landholdings are no
longer viable for agricultural purposes. Petitioners alleged that respondent
assured them that they would only apply for the conversion of the land and that
they would have to surrender the land only upon the approval of said
application and that thereafter, they will be paid a disturbance compensation of
P3,000.00 each. Petitioners also claimed that respondent promised to hire them
to work on the project that was planned for the converted land. But, should the
application for conversion be denied, petitioners will continue to be tenants and
could later become beneficiaries under the Comprehensive Agrarian Reform
Law.

Issue: Whether or not the Compromise Agreement constitute the voluntary

surrender contemplated by law.

Held: Voluntary surrender, as a mode of extinguishment of tenancy relations,

does not require any court authorization considering that it involves the
tenant's own volition. To protect the tenant's right to security of tenure,
voluntary surrender, as contemplated by law, must be convincingly and
sufficiently proved by competent evidence. The tenant's intention to surrender
the landholding cannot be presumed, much less determined by mere
implication. Otherwise, the right of a tenant farmer to security of tenure
becomes an illusory one. Moreover, RA 3844 provides that the voluntary
surrender of the landholding by an agricultural lessee should be due to
circumstances more advantageous to him and his family.

Respondent asserts that petitioners voluntarily surrendered their

landholdings. Petitioners, however, deny this claim and instead maintain that
they did not execute the Compromise Agreement with a view to absolutely sell
and surrender their tenancy rights in exchange for P3,000.00 for each of them.
They assert that such agreement was subject to suspensive conditions, i.e., the
approval of respondents application for conversion of the land to non-
agricultural and their subsequent absorption as laborers in the business that
respondent will put up on said land, or, if the application will not be approved,
petitioners will continue to be tenants of the land and could later on qualify as
beneficiaries of the CARP. Petitioners assert that they were not aware that these
conditions were not incorporated in the Compromise Agreement because they
were not literate in the English language used. Neither were they represented by
counsel nor were the contents of the agreement explained to them. Petitioners
thus claim that the Compromise Agreement should be interpreted in
accordance with the real intention of the parties pursuant to Articles 1370 and
1371 of the Civil Code. Petitioners likewise claim that as they were illiterate in
the English language, they could not have given their valid consent to the
Compromise Agreement.

A perusal of the subject Compromise Agreement reveals that the parties

considered the amount of P3,000.00 together with the income from a single
cropping as comprising the disturbance compensation package, viz:

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“The aforeindicated income derived from the properties and the financial
assistance of P3,000.00 shall be considered as the disturbance compensation
package in favor of the SECOND PARTY by reason or as a result of their
vacating the premises in accordance with Administrative Order No. 1, Series of
1990 of the Department of Agrarian Reform.”

Moreover, it was not shown why petitioners as tenant-farmers would

voluntarily give up their sole source of livelihood. There was likewise no
showing that the money was indeed advantageous to petitioners families as to
allow them to pursue other sources of livelihood.

Thus, the Court finds the evidence on record and respondent's

arguments insufficient to overcome the rights of petitioners as provided in the
Constitution and agrarian statutes. The alleged voluntary surrender of
petitioners of their tenancy rights for the sum of P3,000.00 each could not
constitute as voluntary surrender within the contemplation of law.
Posted by Atty. Glenn Rey Anino at 1:17 AM No comments:
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Labels: Del Castillo Cases

Cacao vs. People

Julius Cacao y Prieto vs. People of the Philippines
[G.R. No. 180870, 610 SCRA 636, January 22, 2010]

Doctrines:

Essential in a drug-related case is that the identity of the dangerous drug

be established beyond reasonable doubt Since the dangerous drug constitutes
the corpus delicti of the offense and the fact of its existence is vital to a
judgment of conviction, it behooves upon the prosecution to establish and prove
with certainty that the dangerous drug presented in court as evidence against
the accused is the same item recovered from his possession.

The failure to establish the chain of custody is fatal to the prosecution’s

case. There can be no crime of illegal possession of a prohibited drug when
nagging doubts persist on whether the item confiscated was the same specimen
examined and established to be the prohibited drug.

Presumption of regularity in the performance of official duty cannot by

itself override the constitutional right of the accused to be presumed innocent
unless overcome by strong, clear and compelling evidence.

Facts:
On October 14, 2004, at around 7:45 in the evening, Police Officer 3
(PO3) Celso Pang-ag of the Intelligence and Operation Section of the Laoag City
Police Station received a telephone call from an informant about a drug session
being held inside Room 5 of the Starlight Hotel located at Barangay 5, Ablan
Avenue, Laoag City.

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 Acting on the information, PO3 Pang-ag, together with PO2 Jonel
Mangapit, went immediately to the Starlight Hotel to determine the veracity of
the report. Upon arrival at the target area, PO3 Pang-ag and PO2 Mangapit
approached the lady clerk manning the information counter of Starlight Hotel
and inquired about the alleged drug session at Room 5 of the hotel.

The lady clerk informed PO3 Pang-ag and PO2 Mangapit that the
roomboy of the hotel was about to deliver a softdrink to Room 5 and they could
follow him if they [so wish]. Thus, PO3 Pang-ag and PO2 Mangapit followed the
roomboy to Room 5. Upon arrival, the roomboy knocked at the door and a
woman, later identified as Mylene, opened the door wide enough to enable the
police officers to look inside.

PO3 Pang-ag and PO2 Mangapit saw petitioner seated on top of the bed
sniffing shabu while Joseph Canlas was on the floor assisting petitioner sniffing
shabu. At this juncture, PO3 Pang-ag and PO2 Mangapit arrested petitioner
and Joseph and confiscated from them the drug paraphernalia, glass tooter,
scissors, lighters and plastic sachets.

PO2 Mangapit frisked petitioner and recovered from him one plastic
sachet containing shabu.

After informing petitioner and Joseph of their constitutional rights, PO3

Pang-ag and PO2 Mangapit brought them to the Laoag City Police Station and
turned them over to the police officer on duty while the confiscated items were
turned over to SPO3 Loreto Ancheta.

The Philippine National Police (PNP) laboratory conducted an

examination on the specimen recovered from appellant and his companion
which tested positive for shabu.

On October 15, 2004, two separate informations were filed against

Joseph Canlas y Naguit and Cacao indicting them for violation of Section 11,
Article II of RA 9165 before the RTC of Laoag City.

Both RTC and CA convicted petitioner.

Issue: Whether or not the lower courts gravely erred in ruling that the guilt of
the accused was proven beyond reasonable doubt.

Held: As a general rule, factual findings and conclusions of the trial court and
the CA are entitled to great weight and respect and will not be disturbed on
appeal. However, if there is any indication that the trial court overlooked certain
facts or circumstances which would substantially affect the disposition of the
case, the Supreme Court will not hesitate to review the same. In this case, the
Court finds it imperative to review the factual findings of the trial court because
of certain inconsistencies in the testimonies of the prosecution witnesses on
material points.

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 A. The testimonies of the prosecutions principal witnesses are
inconsistent as to who delivered the prohibited drug to the evidence
custodian.

In this case, PO3 Celso Pang-ag (Pang-ag) and PO2 Jonel Mangapit
(Mangapit) both testified that it was the latter who brought the item confiscated
from petitioner to the evidence custodian, SPO3 Loreto Ancheta (Ancheta).
However, the foregoing assertions are totally at odds with the testimony of
Ancheta, the evidence custodian. The latter denied that it was Mangapit who
delivered the item allegedly recovered from Cacao. Instead, he repeatedly and
categorically declared that it was SP03 Balolong (Balolong) from whom he
received the plastic sachet of shabu.

Contrary to the findings of the appellate court, The Court is of the

considered view that this contradiction is not so inconsequential or minor but a
discrepancy touching on substantial and significant matter which could well
affect the credibility of the witnesses.

B. The prosecution failed to satisfactorily establish that the item presented

in court was the same item confiscated from Cacao.

The patent inconsistency between the testimonies of Mangapit and Pang-

ag, on one hand, and the testimony of Ancheta on the other hand, necessarily
leads us to doubt that the plastic sachet of shabu identified in court is the same
item that was allegedly seized and confiscated from petitioner. If the version of
Mangapit is to be believed, then the most lamentable aspect pertains to his
failure to identify the seized item with certainty. For sure Mangapit, who is the
most competent person to make the proper identification being the officer who
confiscated the item from Cacao, never actually identified the same.

The only other person who could have identified the subject drug is
Pang-ag. However, the Court cannot lend credence to his supposed
identification, the same not being also positive, certain and unequivocal.
Besides, there is no showing that this witness actually saw the shabu at the
time it was allegedly seized from petitioner. In fact, Pang-ag is even incompetent
to make the identification since from all indications, he has never been in
possession of it.

Moreover, considering the testimony of Ancheta, it was Balolong who

forwarded the seized item. It must be noted that Balolong was never presented
to testify in this case. Thus, there is no evidence to prove that what was turned
over to the evidence custodian by Balolong and later presented in court was the
same substance recovered from petitioner. The failure to establish the chain of
custody is fatal to the prosecution’s case.
Posted by Atty. Glenn Rey Anino at 12:23 AM No comments:
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Thursday, December 21, 2017

Philippine National Bank vs. DKS International Inc. and Michael Dy

Philippine National Bank vs. DKS International Inc. and Michael Dy

[G.R. No. 179161, 610 SCRA 603, January 22, 2010]

Facts: Considering that the sub-lessee which was ordered by the court to
surrender possession of the disputed property in a case for forcible entry no
longer possessed the same, having already surrendered possession thereof to
the lessor and not to the prevailing party which is the lessee, the Regional Trial
Court (RTC) recalled the Writ of Execution with Break Open it earlier issued.

Issue: Was the recall proper?

Held: Yes. Before said writ could be implemented, inescapable material facts
and circumstances were brought to the attention of the RTC. The respondents
had already surrendered possession of the subject premises to the
government. Clearly, the portion of the Decision ordering respondents to vacate
the subject property and peacefully surrender possession thereof to petitioner has
become impossible to implement. For how can respondents surrender possession
of the premises when they were no longer in possession? And, as correctly
observed by the RTC, it would be a misstep if the government which is
admittedly the owner of the subject property and which was not a party to the
ejectment case, would be ordered to vacate the same in order that possession
thereof may be delivered to petitioner. We thus hold that under these
circumstances, the recall of the writ of execution with break open order was
warranted.
Posted by Atty. Glenn Rey Anino at 11:36 PM No comments:
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Labels: Del Castillo Cases
Tuesday, March 28, 2017

Garcia vs. Molina Case Digest

Winston F. Garcia vs. Mario I. Molina
G.R. No. 165223. January 11, 2016

Doctrines:
The fact that the charge against the respondent was subsequently declared to lack factual and
legal bases did not, ipso facto, render the preventive suspension without legal basis.

Gloria vs. CA has clarified that the preventive suspension of civil service employees charged with
dishonesty, oppression or grave misconduct, or neglect of duty is authorized by the Civil Service
Law, and cannot be considered unjustified even if the charges are ultimately dismissed so as to
justify the payment of salaries to the employee concerned.

Facts:
For review is the decision promulgated on April 29, 2004, whereby the Court of Appeals (CA)
nullified the Memorandum dated September 8, 2003 by which the petitioner, in his capacity as

9
the President of the Government Service Insurance System (GSIS), had charged the respondent,
an Attorney V in the Litigation Department of the Legal Service Group of the GSIS, with grave
misconduct and preventively suspended him for 60 days.

In his affidavit, Elino F. Caretero pointed to the respondent as the person who had handed to him
on August 26, 2003 the letter entitled Is It True supposedly written by one R. Ibasco containing
"scurrilous and libellous statements" against petitioner. Considering that Ibasco denied authorship
of the letter, the finger of suspicion came to point at the respondent, who was consequently
administratively investigated for grave misconduct. After the investigation, the Investigation Unit
transmitted its Memorandum dated September 1, 2003 to the respondent to require him to explain
the circulation and publication of the letter, and to show cause why no administrative sanction
should be imposed on him for doing so. In response, he denied the imputed act.

Thereafter, the petitioner issued Memorandum dated September 8, 2003 to formally charge the
respondent with grave misconduct, and to preventively suspend him for 60 days effective upon
receipt.

The respondent sought the dismissal of the charge on the ground of its being baseless; and
requested the conduct of a formal investigation by an impartial body. The respondent also
instituted in the CA a special civil action for certiorari to challenge the legality of the
Memorandum dated September 8, 2003.

On April 29, 2004, the CA promulgated its assailed decision annulling the petitioner's
Memorandum dated September 8, 2003.

Hence, this appeal by petition for review on certiorari.

The petitioner argues that it was in his power as the President and General Manager of the GSIS
to impose disciplinary action on the respondent, pursuant to Section 47 of the Administrative
Code of 1987; that the characterization of the respondent's act as grave misconduct was not
arbitrary because the latter had intentionally passed on or caused the circulation of the malicious
letter, thereby transgressing "some established and definite rule of action" that sufficiently
established a prima facie case for an administrative charge; that the respondent had thereby
violated his solemn duty to defend and assist the petitioner in disregard of his "legal, moral or
social duty" to stop or at discourage the publication or circulation of the letter. He submits that
the respondent's preventive suspension was done in accordance with the Civil Service Uniform
Rules on Administrative Cases, and upon an evaluation of the evidence on record.

Issues:

1. Whether the petitioner Garcia, in the exercise of his authority, had sufficient
basis to formally charge the respondent with grave misconduct and impose preventive
suspension as a consequence.
2. Whether the doctrine of exhaustion of administrative remedy (DEAR) is
applicable.

Rulings:

1. To resolve this issue, we need to ascertain if the respondent's act of handing over the letter to
Caretero constituted grave misconduct. The CA concluded that the act of the respondent of

10
handing over the letter to Caretero did not constitute grave misconduct because the act did not
show or indicate the elements of corruption, or the clear intent to violate the law, or flagrant
disregard of established rule.

The Court concurs with the CA.

Misconduct in office, by uniform legal definition, is such misconduct that affects his performance
of his duties as an officer and not such only as affects his character as a private individual. To
warrant removal from office, it must have direct relation to and be connected with the
performance of official duties amounting either to maladministration or willful, intentional
neglect and failure to discharge the duties of the office. Moreover, it is “a transgression of some
established and definite rule of action, more particularly, unlawful behavior or gross negligence
by a public officer.” It becomes grave if it “involves any of the additional elements of corruption,
willful intent to violate the law or to disregard established rules, which must be established by
substantial evidence.”

The record contains nothing to show that the respondent's act constituted misconduct. The
passing of the letter to Caretero did not equate to any "transgression" or "unlawful behavior," for
it was an innocuous act that did not breach any standard, norm or rule pertinent to his
office. Neither could it be regarded as "circulation" of the letter inasmuch as the letter was handed
only to a single individual who just happened to be curious about the paper the respondent was
then holding in his hands. The handing of the letter occurred in ostensibly innocent circumstances
on board the elevator in which other employees or passengers were on board. If the motive of the
respondent was to pass the letter in order to publicize its contents, he should have made more
copies of the letter. But that was not so, considering that Caretero categorically affirmed in his
affidavit about asking the respondent what he had wanted to do with the letter, to wit: Do you
want me to photocopy the document Sir?, but the respondent had simply replied: HINDI NA SA
IYO NA LANG YAN. It is plain, then, that intent to cause the widespread dissemination of the
letter in order to libel the petitioner could not be justifiably inferred.

To be sure, the respondent's act could not be classified as pertaining to or having a direct
connection to the performance of his official duties as a litigation lawyer of the GSIS. The
connection was essential to a finding of misconduct, for without the connection the conduct
would not be sanctioned as an administrative offense.

The fact that the charge against the respondent was subsequently declared to lack factual and
legal bases did not, ipso facto, render the preventive suspension without legal basis. The formal
charge against the respondent was for grave misconduct, an administrative offense that justifies
the imposition of the preventive suspension of the respondent. Gloria has clarified that the
preventive suspension of civil service employees charged with dishonesty, oppression or grave
misconduct, or neglect of duty is authorized by the Civil Service Law, and cannot be considered
unjustified even if the charges are ultimately dismissed so as to justify the payment of salaries to
the employee concerned. Considering that the respondent's preventive suspension had legal
basis, he was not entitled to backwages.

2. Anent the petitioner's insistence that the respondent did not exhaust his administrative
remedies, Section 21 of the Uniform Rules on Administrative Cases in the Civil Service provides
the option either of filing a motion for reconsideration against the preventive suspension order by
the disciplining authority, or of elevating the preventive suspension order by appeal to the Civil
Service Commission within 15 days from the receipt thereof.

11
We find and hold that the respondent was not strictly bound by the rule on exhaustion of
administrative remedies. His failure to file the motion for reconsideration did not justify the
immediate dismissal of the petition for certiorari, for we have recognized certain exceptional
circumstances that excused his non-filing of the motion for reconsideration. Among the
exceptional circumstances are the following, namely: when the issue involved is purely a legal
question.

Considering that the matter brought to the CA - whether the act complained against justified the
filing of the formal charge for grave misconduct and the imposition of preventive suspension
pending investigation —was a purely legal question due to the factual antecedents of the case not
being in dispute. Hence, the respondent had no need to exhaust the available administrative
remedy of filing the motion for reconsideration.

WHEREFORE, the Court PARTIALLY GRANTS the petition for review on

certiorari; AFFIRMS the assailed decision promulgated on April 29, 2004 and the resolution
promulgated on September 6, 2004 insofar as the Court of Appeals dismissed the formal charge
for grave misconduct against respondent Mario I. Molina, but REVERSES and SETS
ASIDE the decision and the resolution insofar as they nullified the respondent's preventive
suspension and awarded backwages to him corresponding to the period of his preventive
suspension; and MAKES NO PRONOUNCEMENT on costs of suit.
Posted by Atty. Glenn Rey Anino at 1:44 AM No comments:
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Labels: 2016, Bersamin 2016 Cases, Bersamin_Political Law Case Digest

MCIAA vs. Heirs of Ijordan, et al.

Mactan Cebu International Airport Authority (MCIAA) Vs. Heirs of Gavina Ijordan, et al.
G.R. No. 173140. January 11, 2016

BERSAMIN, J.:

Doctrine:
A sale of jointly owned real property by a co-owner without the express authority of the others is
unenforceable against the latter, but valid and enforceable against the seller.

Facts:
On October 14, 1957, Julian Cuizon (Julian) executed a Deed of Extrajudicial Settlement and
Sale (Deed) covering Lot No. 4539 (subject lot) situated in Ibo, Municipality of Opon (now
Lapu-Lapu City) in favor of the Civil Aeronautics Administration ((CAA), the predecessor-in-
interest of petitioner Manila Cebu International Airport Authority (MCIAA).

In 1980, the respondents caused the judicial reconstitution of the original certificate of title
covering the subject lot. Consequently, Original Certificate of Title (OCT) No. RO-2431 of the
Register of Deeds of Cebu was reconstituted for Lot No. 4539 in the names of the respondents'
predecessors-in-interest, namely, Gavina Ijordan, and Julian, Francisca, Damasina, Marciana,
Pastor, Angela, Mansueto, Bonifacia, Basilio, Moises and Florencio, all surnamed Cuison. The
respondents' ownership of the subject lot was evidenced by OCT No. RO-2431. They asserted
that they had not sold their shares in the subject lot, and had not authorized Julian to sell their
shares to MCIAA's predecessor-in-interest.

12
The failure of the respondents to surrender the owner's copy of OCT No. RO-2431 prompted
MCIAA to sue them for the cancellation of title in the RTC, alleging in its complaint that the
certificate of title conferred no right in favor of the respondents because the lot had already been
sold to the Government in 1957; that the subject lot had then been declared for taxation purposes
under Tax Declaration No. 00387 in the name of the BAT; and that by virtue of the Deed, the
respondents came under the legal obligation to surrender the certificate of title for cancellation to
enable the issuance of a new one in its name.

After MCIAA's presentation of evidence, the respondents moved to dismiss the complaint upon
the Demurrer to Evidence dated February 3, 1997, contending that the Deed and Tax Declaration
No. 00387 had no probative value to support MCIAA's cause of action and its prayer for relief.
They cited Section 3, Rule 130 of the Rules of Court which provided that "when the subject of
inquiry is the contents of a document, no evidence shall be admissible other than the original
document itself." They argued that what MCIAA submitted was a mere photocopy of the Deed;
that even assuming that the Deed was a true reproduction of the original, the sale was
unenforceable against them because it was only Julian who had executed the same without
obtaining their consent or authority as his co-heirs; and that the tax declaration had no probative
value by virtue of its having been derived from the unenforceable sale.

In its order dated September 2, 1997, the RTC dismissed MCIAA's complaint insofar as it
pertained to the shares of the respondents in Lot No. 4539 but recognized the sale as to the 1/22
share of Julian.

The CA affirmed the orders of the RTC. Hence, this petition.

Issues:
1. Whether the subject lot was validly conveyed in its entirety to the petitioner.
2. Whether respondents are guilty of estoppel by laches.
3. Whether MCIAA possessed the subject lot by virtue of acquisitve prescription.

Rulings:
1. No, the CA and the RTC concluded that the Deed was void as far as the respondents' shares in
the subject lot were concerned, but valid as to Julian's share. Their conclusion was based on the
absence of the authority from his co-heirs in favor of Julian to convey their shares in the subject
lot. We have no reason to overturn the affirmance of the CA on the issue of the respondents' co-
ownership with Julian. Hence, the conveyance by Julian of the entire property pursuant to the
Deed did not bind the respondents for lack of their consent and authority in his favor. As such, the
Deed had no legal effect as to their shares in the property. Article 1317 of the Civil Code provides
that no person could contract in the name of another without being authorized by the latter, or
unless he had by law a right to represent him; the contract entered into in the name of another by
one who has no authority or legal representation, or who has acted beyond his powers, is
unenforceable, unless it is ratified, expressly or impliedly, by the person on whose behalf it has
been executed, before it is revoked by the other contracting party.

But the conveyance by Julian through the Deed had full force and effect with respect to his share
of 1/22 of the entire property consisting of 546 square meters by virtue of its being a voluntary
disposition of property on his part. As ruled in Torres v. Lapinid:

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x x x even if a co-owner sells the whole property as his, the sale will affect only his own share but
not those of the other co-owners who did not consent to the sale. This is because the sale or other
disposition of a co-owner affects only his undivided share and the transferee gets only what
would correspond to his grantor in the partition of the thing owned in common.

2. No. MCIAA's assertion of estoppel or ratification to bar the respondents' contrary claim of
ownership of their shares in the subject lot is bereft of substance. The doctrine of estoppel applied
only to those who were parties to the contract and their privies or successors-in-interest.
Moreover, the respondents could not be held to ratify the contract that was declared to be null and
void with respect to their share, for there was nothing for them to ratify. Verily, the Deed, being
null and void, had no adverse effect on the rights of the respondents in the subject lot.

3. No. MCIAA's contention on acquisitive prescription in its favor must fail. Aside from the
absence of the satisfactory showing of MCIAA's supposed possession of the subject lot, no
acquisitive prescription could arise in view of the indefeasibility of the respondents' Torrens title.
Under the Torrens System, no adverse possession could deprive the registered owners of their
title by prescription. The real purpose of the Torrens System is to quiet title to land and to stop
any question as to its legality forever. Thus, once title is registered, the owner may rest secure,
without the necessity of waiting in the portals of the court, or sitting on the mirador su casa to
avoid the possibility of losing his land.

WHEREFORE, the Court DENIES the petition for review on certiorari; and AFFIRMS the
decision promulgated on February 22, 2006.

Posted by Atty. Glenn Rey Anino at 12:32 AM No comments:

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Labels: 2016, Bersamin 2016 Cases, Bersamin_Civil Law Case Digest
Monday, March 27, 2017

Ladines vs. People Case Digest

Pedro Ladines vs. People of the Philippines and Edwin De Ramon
G.R. No. 167333. January 11, 2016

BERSAMIN, J.:

Doctrine:
To impose the highest within a period of the imposable penalty without specifying the
justification for doing so is an error on the part of the trial court that should be corrected
on appeal. In default of such justification, the penalty to be imposed is the lowest of the
period.

Facts:
While Prosecution witnesses Philip de Ramon and Mario Lasala, along with victim Erwin
de Ramon (Erwin), were watching the dance held during the June 12, 1993 Grand
Alumni Homecoming of the Bulabog Elementary School in Sorsogon, Sorsogon, the
petitioner and Licup appeared and passed by them. The petitioner suddenly and without
warning approached and stabbed Erwin below the navel with a machete. The petitioner
then left after delivering the blow. At that juncture, Licup also mounted his attack against
Erwin but the latter evaded the blow by stepping back. Erwin pulled out the machete

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from his body and wielded it against Licup, whom he hit in the chest. Licup pursued but
could not catch up with Erwin because they both eventually fell down. Erwin was rushed
to the hospital where he succumbed.

Dr. Myrna Listanco, who performed the post-mortem examination on the cadaver of
Erwin, attested that the victim had sustained two stab wounds on the body, one in the
chest and the other in the abdomen. She opined that one or two assailants had probably
inflicted the injuries with the use of two distinct weapons; and that the chest wound could
have been caused by a sharp instrument, like a sharpened screwdriver, while the
abdominal injury could have been from a sharp bladed instrument like a knife.

In his defense, the petitioner tendered alibi and denial. He recounted that at the time in
question, he was in the Bulabog Elementary School compound along with his wife and
their minor child; that they did not enter the dance hall because there was trouble that
had caused the people to scamper; that they had then gone home; that he had learned
about the stabbing incident involving Erwin on their way home from Barangay Tanod
Virgilio de Ramon who informed him that Licup and Erwin had stabbed each other; and
that Prosecution witnesses Philip and Lasala harbored ill-will towards him by reason of
his having lodged a complaint in the barangay against them for stealing coconuts from
his property.

The petitioner presented Angeles Jasareno and Arnulfo Palencia to corroborate his
denial. Jasareno and Palencia testified that at the time in question they were in the
Bulabog Elementary School, together with the petitioner, the latter's wife and their minor
daughter; that while they were watching the dance, a quarrel had transpired but they did
not know who had been involved.

On August 12, 1993, an information was filed in the RTC charging the petitioner and one
Herman Licup with homicide.

On February 10, 2003, the RTC pronounced the petitioner guilty as charged, decreeing:

WHEREFORE, premises considered, the Court finds accused Pedro Ladines guilty
beyond reasonable doubt of the crime of Homicide, defined and penalized under Article
249 of the Revised Penal Code, sans any mitigating circumstances and applying the
Indeterminate Sentence Law, accused Pedro Ladines is hereby sentenced to suffer
an imprisonment of from Ten (10) years and One (1) day of prision mayor as
minimum to 17 years and 4 months of reclusion temporal as maximum and to pay
the sum of P50,000.00 as civil indemnity without subsidiary imprisonment [in] case of
insolvency and [to] pay the costs.

On appeal, the CA affirmed the conviction. Petitioner filed an appeal insisting that the CA
committed reversible error in affirming his conviction despite the admission of Licup
immediately after the incident that he had stabbed the victim; and that the res gestae
statement of Licup constituted newly-discovered evidence that created a reasonable
doubt as to the petitioner's guilt.

Issues:
1. Whether the res gestae statement of Licup constitutes newly-discovered
evidence that would create a reasonable doubt as to the petitioner's guilt.

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 2. Whether the RTC imposed the proper penalty.
3. Whether the lower court's limitation of the civil liability to civil indemnity of
only P50,000.00 is correct.

Rulings:
1. No, the res gestae statement of Licup did not constitute newly-discovered evidence
that created a reasonable doubt as to the petitioner's guilt. We point out that the concept
of newly-discovered evidence is applicable only when a litigant seeks a new trial or the
re-opening of the case in the trial court. Seldom is the concept appropriate on appeal,
particularly one before the Court.

Furthermore, the Court has issued guidelines designed to balance the need of persons
charged with crimes to afford to them the fullest opportunity to establish their defenses,
on the one hand, and the public interest in ensuring a smooth, efficient and fair
administration of criminal justice, on the other. The first guideline is to restrict the
concept of newly-discovered evidence to only such evidence that can satisfy the
following requisites, namely: (1) the evidence was discovered after trial; (2) such
evidence could not have been discovered and produced at the trial even with the
exercise of reasonable diligence; (3) the evidence is material, not merely cumulative,
corroborative, or impeaching; and (4) the evidence is of such weight that it would
probably change the judgment if admitted. (Emphasis is mine).

We agree with the State that the proposed evidence of the petitioner was not newly-
discovered because the first two requisites were not present. The petitioner, by his
exercise of reasonable diligence, could have sooner discovered and easily produced the
proposed evidence during the trial by obtaining a certified copy of the police blotter that
contained the alleged res gestae declaration of Licup and the relevant documents and
testimonies of other key witnesses to substantiate his denial of criminal responsibility.
2. We declare that the lower courts could not impose 17 years and four months of the
medium period of reclusion temporal, which was the ceiling of the medium period of
reclusion temporal, as the maximum of the indeterminate penalty without specifying the
justification for so imposing. They thereby ignored that although Article 64 of the Revised
Penal Code, which has set the rules "for the application of penalties which contain three
periods," requires under its first rule that the courts should impose the penalty prescribed
by law in the medium period should there be neither aggravating nor mitigating
circumstances, its seventh rule expressly demands that "[w]ithin the limits of each
period, the courts shall determine the extent of the penalty according to the number and
nature of the aggravating and mitigating circumstances and. the greater or lesser extent
of the evil produced by the crime." By not specifying the justification for imposing the
ceiling of the period of the imposable penalty, the fixing of the indeterminate sentence
became arbitrary, or whimsical, or capricious. In the absence of the specification, the
maximum of the indeterminate sentence for the petitioner should be the lowest of the
medium period of reclusion temporal, which is 14 years, eight months and one day of
reclusion temporal.

3. The limitation was a plain error that we must correct. Moral damages and civil
indemnity are always granted in homicide, it being assumed by the law that the loss of
human life absolutely brings moral and spiritual losses as well as a definite loss. Moral
damages and civil indemnity require neither pleading nor evidence simply because

16
death through crime always occasions moral sufferings on the part of the victim's
heirs. The civil indemnity and moral damages are fixed at P75,000.00 each because
homicide was a gross crime.

WHEREFORE, the Court AFFIRMS the decision promulgated on October 22, 2004
subject to the MODIFICATION that: (a) the INDETERMINATE SENTENCE of
petitioner PEDRO LADINES is 10 years and one day of prision mayor, as minimum, to
14 years, eight months and one day of the medium period of reclusion temporal, as
maximum; and (b) the petitioner shall pay to the heirs of the victim Erwin de Ramon: (1)
civil indemnity and moral damages of P75,000.00 each; (2) temperate damages of
P25,000.00; (c) interest of 6% per annum on all items of the civil liability computed from
the date of the finality of this judgment until they are fully paid; and (d) the costs of suit.

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