Civil Procedure
G.R. No. 204222 July 4, 2016 NEPTUNE METAL SCRAP RECYCLING,
INC., vs.MANILA ELECTRIC COMPANY and THE PEOPLE OF THE PHILIPPINES,
DECISION BRION, J.:
We resolve the petition for review on certiorari challenging the March 20,
2012 and October 19, 2012 resolutions1of the Court of Appeals (CA) in CA-G.R. SP
No. 119642. The CA denied the motion for leave to intervene and to admit the
comment-in-intervention filed by Neptune Metal Scrap Recycling, Inc. (Neptune) due
to lack of legal interest to intervene and late filing of the intervention.
THE FACTS
Neptune traces its roots to the criminal case filed against Rolando Flores (Flores) and
Jhannery Hupa (Hupa) (the accused). On August 10, 2010, the accused were driving a
trailer truck with a container van towards the Manila International Container Port
when men from the Criminal Investigation and Detection Group flagged them down
on suspicion that they were illegally transporting electric power transmission scrap
copper wires owned by the Manila Electric Company (Meralco). The police seized
the truck with its contents and detained the accused.
The accused were charged before the Regional Trial Court (RTC) of Malabon with
theft of electric power transmission lines and materials under Section 3 of Republic
Act (RA) No. 7832.2 The case was docketed as Criminal Case No. 10-1419.
The accused filed a motion to quash the information alleging that the facts charged
in the information do not constitute an offense.
Neptune filed its entry of special appearance with motion for leave to permit the
inspection, examination, and photographing of the seized container van (entry
with motion). Neptune argued that it owned the contents of the container van,
specifically, the thirteen (13) bundles of scrap copper wires worth around Eight
Million Pesos (₱8,000,000.00). Neptune presented several documents to prove its
claim of ownership.3
The RTC granted Neptune’s motion and ordered the inspection of the container van
and its contents. A second inspection was done to allow Meralco’s representatives
to inspect the same.
Neptune continued to participate in the RTC proceedings. It filed several pleadings
before the RTC such as: (a) a manifestation on the results of the first inspection; (b) a
motion to deposit the keys to the container van with the court; (c) a supplement to
the motion to deposit the keys; (d) a memorandum of authorities on "birch cliff
copper"; (e) a manifestation on the results of the second inspection; (f) a motion for
the release of the goods; and (g) the comment to Meralco’s compliance.4 Neptune
also took part in the clarificatory hearing on the inspection.
On January 3, 2011, the RTC ordered the quashal of the information.5 The RTC noted
that no Meralco power transmission scrap copper wires were found in the container
van during the two ocular inspections. The RTC also ordered the return of the keys
and the container van to Neptune. Neptune recovered three remaining bundles of
scrap copper wires.
Meralco filed a motion for reconsideration which the RTC denied. Meralco then filed
a petition for certiorari before the CA asking to reinstate the information; it did not
include Neptune as a party. Thus, Neptune filed a motion for leave to intervene and
to admit its comment-in-intervention. Meralco opposed this motion claiming that
the subject matter of the offense, i.e., the electric power transmission scrap copper
wires, is different from the birch cliff copper wires claimed by Neptune.
The CA denied Neptune’s motion for leave to intervene. The CA ruled that: (a)
Neptune failed to demonstrate its legal interest on the subject matter in litigation;
(b) the intervention will unduly delay or prejudice the case; and (c) Neptune failed to
timely file a motion for intervention before the RTC and to directly and actively
participate in the RTC proceedings. The CA added that Neptune may vindicate its
rights in a separate action.
The CA also denied Neptune’s motion for reconsideration; hence, this petition.
THE PARTIES’ ARGUMENTS
Civil Procedure
In its petition, Neptune argues that it has legal interest over the subject matter in
litigation – the scrap copper "birch cliff" found in the container van; in fact, it was
persistent in asserting its right of ownership even before the RTC. If the RTC’s order
is reversed, Neptune stands to lose the three recovered bundles of copper scrap
worth approximately ₱2,000,000.00 because Articles 25 and 45 of the Revised Penal
Code (RPC) provide for the forfeiture of the instruments and proceeds of an offense
in favor of the government. Neptune adds that the owner of a property subject of
the litigation has a right to intervene.
Neptune also argues that the intervention would not delay the adjudication of the
parties’ rights, and in fact would facilitate the administration of justice in
determining whether the accused are liable for the crime charged.
Neptune stresses that its entry with motion was effectively a motion for intervention
timely filed before the RTC. The RTC, it adds, also recognized Neptune’s intervention
by allowing it to participate in the proceedings by filing numerous pleadings and
appearing in court hearing.
Assuming that the motion for intervention was belatedly filed, Neptune argues, the
CA should still have allowed Neptune’s intervention. As a general rule, intervention
is allowed only before or during a trial. However, in several cases, the Court has
allowed intervention even after rendition of judgment if the facts and merits of the
case warrant it.6
In its comment,7 the Office of the Solicitor General (OSG), representing the People of
the Philippines, argues: first, that Neptune’s petition raises questions of fact which
are not allowed in a Rule 45 petition. The issue of whether Neptune complied with
the requirements for intervention requires the Court to scrutinize the evidence.
Second, the OSG insists, that Neptune has no legal interest to justify the intervention
for three reasons: (1) Neptune has no legal interest in the subject matter of the case.
The subject matter in the present case is the transmission copper wires owned by
Meralco, not the birch cliff copper wires claimed by Neptune. (2) Neptune has no
interest in the success of either party or against both parties because it cannot be
prejudiced by a court’s finding of guilt of the accused. (3) Neptune cannot be
adversely affected by the distribution or disposition of the property in the court’s
custody. The OSG notes that the container van is not in the court’s custody as it has
not yet been offered in evidence.
Third, the OSG argues that the motion for intervention was belatedly filed. It
emphasizes that Neptune filed only an entry with special appearance, not a motion
for intervention, before the RTC. The entry of special appearance could not be
considered a motion for intervention because it had no pleading-in-intervention
attached to it as required under Section 19 of the Rules of Court (Rules). The motion
for leave to permit inspection, examination, and photographing of the seized
container van does not constitute a pleading-in-intervention. Thus, the RTC gravely
abused its discretion when it took cognizance of Neptune’s motions and pleadings
despite the absence of personality to take part in the proceedings.
In its reply,8 Neptune reiterates its arguments and adds that the legal question
raised in the petition is whether the entry and its accompanying motion were
effectively a motion for intervention under Rule 19 of the Rules. Even assuming that
the petition raises a pure question of fact, the Court may still take cognizance of the
case as it falls under the two exceptions: (a) the CA’s findings of fact are conclusions
without citation of specific evidence; and (b) the CA’s findings of fact are premised
on the supposed absence of evidence and contradicted by the evidence on record.
Neptune also clarifies that the transmission wires claimed by Meralco are part of the
scrap copper wires claimed by Neptune.1âwphi1 In fact, the RTC found no Meralco
property inside the container van. Meralco also failed to present any evidence to
show that it owns the copper wires.
THE COURT’S RULING
We find the petition meritorious.
The issue before the Court is whether the CA erred in denying Neptune’s motion for
intervention.
Intervention is a remedy by which a third party, who is not originally impleaded in a
proceeding, becomes a litigant for purposes of protecting his or her right or interest
that may be affected by the proceedings.9 Intervention is not an absolute right but
may be granted by the court when the movant shows facts which satisfy the
Civil Procedure
requirements of the statute authorizing intervention.10 The allowance or
disallowance of a motion to intervene is within the sound discretion of the court.11
Section 1, Rule 19 of the Rules provides that a court may allow intervention (a) if the
movant has legal interest or is otherwise qualified, and (b) if the intervention will not
unduly delay or prejudice the adjudication of rights of the original parties and if the
intervenor’s rights may not be protected in a separate proceeding.12 Both
requirements must concur.
Section 2, Rule 19 of the Rules requires a movant to file the motion for intervention
before the RTC’s rendition of judgment and to attach a pleading-in-
intervention.13 The court may allow intervention after rendition of judgment if the
movant is an indispensable party.14
With these procedural rules as guidelines, we examine, first, whether Neptune has a
legal interest to intervene in the present case. Is Neptune’s ownership of the
allegedly stolen items sufficient to grant intervention?
A movant for intervention must have legal interest either (i) in the matter in
litigation, (ii) in the success of either of the parties, or (iii) against both parties. 15 The
movant may also intervene if he or she is (iv) so situated as to be adversely affected
by a distribution or other disposition of property in the court’s custody.16 Legal
interest is present when the intervenor will either gain or lose as a direct effect of
the judgment.17 The legal interest must be actual and material, direct, and
immediate.18 In a theft case, the subject matter in litigation is the item alleged to
have been stolen.19
In the present case, Neptune argues that it has a legal interest in the subject matter
in litigation, particularly, the scrap copper wires in the container van. The RTC found
Neptune to be the owner of the contents of the container van; hence, it released
these contents to Neptune. The RTC also noted that no Meralco transmission wires
were found in the container van during the two ocular inspections. Thus, the RTC
quashed the information against the accused.
As the owner of the scrap copper wires, Neptune undoubtedly has legal interest in
the subject matter in litigation. The CA’s reversal of the RTC’s quashal of the
information would necessarily require Neptune to return the bundles of copper wire
it had recovered. Undoubtedly, Neptune, as the owner, has a legal interest in the
subject matter in litigation before the CA.
Second, we determine whether Neptune’s intervention would unduly delay or
prejudice the adjudication of the rights of the accused and of the State. We also
consider whether Neptune’s rights may be protected in a separate proceeding.
In one case,20 the Court effectively placed the burden on the oppositors to argue
that the intervention would delay the proceedings and that the intervenor’s rights
would not be protected in a separate case. The Court noted that the oppositors
focused their arguments on the intervenor’s lack of legal interest such that they
failed to allege or present any evidence to meet the second requirement in granting
intervention.21 Thus, the Court has no basis to rule that the intervention will delay
the adjudication of rights of the original parties.22 Too, the intervention is more
beneficial and convenient for petitioners and the courts as it will avoid multiplicity of
suits and clogging of the court dockets.23
Similarly, in the present case, the OSG failed to allege or present any evidence
showing that Neptune’s intervention will delay the proceedings and that Neptune
may protect its rights in a separate case.
Additionally, allowing Neptune’s intervention is even beneficial to the courts in
ascertaining whether theft indeed occurred. The information filed before the RTC
alleges that the accused committed theft against Meralco. Lack of owner’s consent is
an essential element of the crime of theft. Neptune’s intervention will assist the CA
in ascertaining the owner of the scrap copper wires – whether Meralco or Neptune –
and in determining whether the rightful owner gave its consent to the accused’s act
of taking the scrap copper wires. It should be stressed, too, that granting the
intervention would reduce the suits filed in court.
Third, we verify whether Neptune timely filed its intervention. As we noted above, a
would-be intervenor must file the motion for intervention before the RTC renders its
judgment.
In the present case, Neptune filed a motion denominated as "motion for
intervention" only before the CA or only after the RTC had rendered its judgment.
Neptune argues that the entry with motion it filed with the RTC is tantamount to a
Civil Procedure
motion for intervention. The OSG, on the other hand, argues that the entry with WHEREFORE, we hereby GRANT the petition. The March 20, 2012 and October 19,
motion cannot constitute as a motion for intervention because it lacked the 2012 resolutions of the Court of Appeals in CA-G.R. SP No. 119642 are
pleading-in-intervention required by the Rules. hereby REVERSED and SET ASIDE.

We rule in Neptune's favor and hold that the entry with motion effectively SO ORDERED.
constitutes a motion for intervention.
ARTURO D. BRION
The rules on intervention are procedural rules, which are mere tools designed to Associate Justice
expedite the resolution of cases pending in court.24 Courts can avoid a strict and
rigid application of these rules if such application would result in technicalities that
tend to frustrate rather than promote substantial justice.25

In the present case, Neptune only filed a special appearance with a motion to
inspect the container van before the RTC.1âwphi1 At that time, Neptune was still
uncertain whether it owned or it had legal interest over the container van's
contents. After the inspection, however, it ascertained that it indeed owned the
scrap copper wires and thus continued to participate in the case. Notably, the RTC
allowed Neptune to appear, file pleadings, and represent itself in the court
proceedings. All these amount to intervention as contemplated under the rules.

The lack of a pleading-in-intervention attached to the entry with motion is justified

by Neptune's initial uncertainty as to the ownership of the container van's contents.
After the ocular inspections, we note that Neptune filed manifestations, motions,
and comment before the RTC to disprove Meralco' s alleged ownership and to
reclaim the scrap copper wires. These pleadings were accepted and considered by
the RTC in rendering its decision.

Undeniably, the RTC allowed Neptune to intervene in the case via the entry with
motion, albeit without filing a motion specifically denominated as a "motion for
intervention." Thus, Neptune complied with the requirement of filing an
intervention prior to the RTC's rendition of judgment.

All told, the CA erred when it denied Neptune's motion for intervention on the
grounds that it lacked legal interest to intervene and that it filed the intervention
beyond the prescribed period.
Civil Procedure
A.M. No. RTJ-99-1467. August 5, 1999 ATTY. SAMUEL D.
PAGDILAO, JR., Chief of Police, Caloocan City, vs. JUDGE ADORACION G. ANGELES,
RTC, Branch 121, Caloocan City,
RESOLUTION MENDOZA, J.:
This is a complaint for grave abuse of discretion filed against respondent Judge
Adoracion G. Angeles of the Regional Trial Court, Branch 121, Caloocan
City. Complainant is the Chief of Police of Caloocan City, Samuel D. Pagdilao, Jr. The
complaint stemmed from several orders of arrest issued by respondent against
Caloocan City policemen for their failure to attend hearings in criminal cases and
testify as state witnesses, which respondent wanted complainant to personally
enforce.
The record shows that on August 10, 1998, respondent issued an order of arrest
which reads as follows:[1]
In todays initial trial in Criminal Case Nos. C-53625 (98), 53626 (98), 53622 and
53623 (98), accused Manuel Mendoza and Romeo Cendao appeared and assisted by
Atty. Ojer Pacis of the Public Attorneys Office (PAO). However, there was no
appearance on the part of PO2 Alexander Buan. The records will show however that
he was duly notified of todays hearing but despite notice he did not appear thereby
delaying the early termination of these cases.
Consequently, and on motion of the public prosecutor, let a warrant of arrest be
issued against PO2 ALEXANDER BUAN and the Chief of Police, Caloocan City, Police
Superintendent Samuel Pagdilao is hereby directed to effect the service of the
warrant of arrest and to bring the body of the witness not later then 8:30 oclock in
the morning tomorrow, August 11, 1998 for him to testify in these cases.
The accused is likewise directed to appear tomorrow, August 11, 1998.
WHEREFORE, let the scheduled hearing for today be cancelled and have it reset
tomorrow, August 11, 1998 at 8:30 oclock in the morning.
SO ORDERED.
On August 11, 1998, respondent issued another order in another case (Criminal
Case No. C-53081(97)), the pertinent portion of which reads:[2]
After the pre-trial in this case has been waived by the accused through counsel, the
Public Prosecutor failed to present its evidence on the ground that his witnesses,
mostly police officers, did not appear despite notices.
Consequently, on motion of the Public Prosecutor, let a warrant of arrest be issued
against SPO1 Edgardo Fernandez and PO3 Eduardo S. Avila.
Let the service of the warrant of arrest upon SPO1 Edgardo Fernandez and PO3
Eduardo S. Avila be effected by no less than the Chief of Police of Caloocan City,
Supt. Samuel Pagdilao and the latter is directed to make a return on or before
September 1, 1998.
On August 12, 1998, in Criminal Case No. C-53796(98), respondent issued an
order reading:[3]
A cursory examination of the records will readily show that on June 23, 1998 P/Insp.
Emmanuel R. Bravo appeared and signed for the scheduled hearing today, August
12, 1998 at 8:30 oclock in the morning, but he did not appear despite notice thereby
delaying the early termination of this case.
Let it be noted that the accused is a detention prisoner who is entitled to a speedy
trial and the trial could not proceed in view of the non-appearance of the aforesaid
witness.
Consequently, and on motion of the public prosecutor, let a warrant of arrest be
issued against P/Insp. Emmanuel R. Bravo of the Caloocan City Police Force and let
the warrant be served personally by the Chief of Police of Caloocan City, Police
Superintendent Samuel Pagdilao and the latter is directed to make a return of the
warrant not later than 8:30 oclock in the morning tomorrow, August 13, 1998.
Apparently, resenting the tenor of the orders directed personally at him,
complainant wrote respondent on August 14, 1998 asking for the reconsideration of
the foregoing orders:[4]
14 August 1998
Civil Procedure
Honorable Adoracion G. Angeles
Acting Presiding Judge
RTC Branch 125, Caloocan City
Your Honor:
This is with regards to orders lately coming from that (sic) Honorable Court directing
the undersigned to personally serve and return subpoenas and warrants of arrests
against PNP personnel assigned within and/or outside the Caloocan City Police
Station.
As Chief of Police of one of the three biggest Police Departments in the National
Capital Region (next only to Manila and Quezon City), I have to attend to many
matters which would prevent my personally performing the task of service on (sic)
subpoena and warrants.
May I, therefore, respectfully request the Honorable Court to reconsider such orders
and instead allow the undersigned to delegate to subordinate officers particularly,
the Chief, Warrant and Subpoena Section and Sub-Station Commanders, the
performance of this task. This will allow the undersigned to personally attend to the
many operational activities of law enforcement as well as the various administrative
functions as Head of the Citys Police Department.
The order of the Honorable Judge to the undersigned Chief of Police disregards the
time honored tradition and system of Command and Control practiced in our
organization and reduces the level of the Chief of Police into a subpoena server and
arresting officer. A job which can be readily accomplished by the Chief of Warrant
and Subpoena Section and by other officers whom the Commander may direct
under this system.
Records show that service of warrants and subpoena to PNP personnel have all been
duly accomplished by our warrant and Subpoena Section.
I hope that this request will merit your favorable consideration.
Very respectfully yours,
(signed)
ATTY. SAMUEL D. PAGDILAO JR.
Police Superintendent (DSC), Chief of Police
Copy Furnished: The Honorable Chief Justice, Supreme Court
The Honorable Court Administrator, Supreme Court
The Chief of the Philippine National Police
Respondents reaction was just as acerbic. In an order, dated August 21, 1998,
denying complainants request for reconsideration, she said:[5]
Before this court for consideration is a Letter-Request dated August 14, 1998 filed by
P/Supt. Samuel D. Pagdilao, Jr., Chief of Police of the Caloocan City Police
Department.
He assails the orders coming from this court directing him to personally serve and
return subpoenas and warrants of arrest against PNP personnel assigned within
and/or outside the Caloocan City Police Station. He further contends that such
orders disregard the time-honored tradition and system of Command and Control
practiced in their organization and reduces the level of the Chief of Police into a
subpoena server and arresting officer.
Apparently, P/Supt. Samuel D. Pagdilao, Jr. perceives the assailed orders as an
affront to the eminence of his position as Chief of Police above all else.
Nonetheless, this court has never entertained thoughts of debasing the Chief of
Police or anybody else for that matter. Nor was it ever enticed to employ dictatorial
schemes to abbreviate its proceedings despite the fact that the Presiding Judge is
practically handling three (3) salas at the moment - the first as the duly appointed
judge, the second in an acting capacity and the third as the pairing judge for the
presiding judge thereat who has been on leave for quite some time already.
Notwithstanding the incessant pressure inherent in the job, this court takes pride in
the fact that it has never lost its clear vision that it exists primarily for the proper and
expeditious administration of justice.
Indeed, this court has always been very zealous in the discharge of its bounden
duties. Nonetheless, its earnest efforts to promote a speedy administration of
justice has many times been unduly hampered by the frequent non-appearances of
Civil Procedure
police officers in court hearings despite sufficient notice. It has always been a big
disappointment to the court that its dedication to duty is sometimes not matched by
some law-enforcement officers.
Hence, in order to solve this dilemma, the Court directed the Chief of Police to
personally ensure the attendance of his men in court hearings so much so that (sic)
their testimonies are very vital to the outcome of the criminal cases herein. The
Orders of the court were never meant to disregard the system of Command and
Control being employed in the Police Force. Its only concern was that such system of
Command and Control must be effectively used to address the lukewarm attitude of
the Chief of Polices subordinates relative to their duty to appear in court.
It is noteworthy to mention that since the issuance of the assailed Orders, the
concerned law enforcement officers have shown an impressive attendance in court
hearings which confirms that it makes a lot of difference when the Chief of Police
himself acts to ensure the compliance of his subordinates to a lawful court Order.
Needless to state, the court was able to solve a perennial problem with the renewed
cooperation of the Citys police force.
The court should not therefore be taken to task for its issuance of the questioned
Orders because the same was done in the interest of justice.
On the other hand, the Chief of Police must be reminded that this is not the time to
be onion-skinned and regard the said Orders as a personal insult to his dignity.
During this time when criminality is on the rise, would it not be more prudent for the
Chief of Police to lay aside his egotistical concerns and instead work with the courts
of justice in addressing the more pressing problems of criminality, violence and
injustice?
WHEREFORE, premises considered, the Letter-Request of the Chief of Police of
Caloocan City is duly noted but the court reiterates its stand that its foremost
concern is the administration of justice and with this consideration indelibly etched
in its mind, it will issue such Orders which are geared towards the achievement of its
noble purpose.
Let copies of this Order be furnished upon the Honorable Chief Justice and
Honorable Court Administrator of the Supreme Court as well as to the Chief of the
Philippine National Police (PNP).
SO ORDERED.
In his complaint, dated October 28, 1998, complainant avers that respondents
orders betray her ignorance of the rulings of this Court in several cases that non-
attendance at a trial does not constitute direct but indirect contempt punishable
only after written charge and hearing under Rule 71 of the Rules of Court. He states
that the action of respondent not only seriously affects the service records of the
concerned policemen but also jeopardizes their promotions.
Complainant likewise assails the orders of respondent requiring him personally
to arrest the policemen concerned, make a return of the orders, and in the case of
PO2 Alexander Buan, to bring the latter to respondents court not later than 8:30 in
the morning of August 11, 1998. Complainant claims that the order is capricious and
whimsical because the time given to him for serving the warrant was short and
disregarded the system of command and control, and the doctrine of qualified
political agency in the administration of public offices. According to complainant,
when he asked respondent to reconsider her order and allow his subordinates,
particularly the Chief of the Warrant and Subpoena Section and the Sub-Station
Commanders, to serve the orders in question, respondent arrogantly dismissed [the
principle complainant was raising] as nothing but a display of egotistical concerns.
In her comment on the complaint, respondent contended that the warrants of
arrest against the Caloocan City policemen were issued merely for the purpose of
compelling the attendance of the policemen at the court hearings as state witnesses
as it had been her experience that the policemen ignored her orders. She stated that
in issuing the orders in question she was never motivated by ill will but that her
concern was solely to expedite the proceedings in two salas of the court over which
she was presiding since justice delayed is justice denied. She reiterated what she
said in her order denying complainants request to be relieved from serving the
orders. Respondent contends that a prior charge or hearing is not required before a
warrant of arrest may be issued under Rule 21, 8 of the Rules of Court. She argues
that this provision only requires proof of service of subpoena on a witness and the
Civil Procedure
fact that the witness failed to attend the scheduled hearing before a court can
exercise its power of compulsion.
On the allegation that complainant was given a very short period of time for
serving the warrant of arrest against witness PO2 Buan, respondent points out that
the policeman was right in the Caloocan City Police Station were complainant held
office. As for her statement that complainants letter was nothing but a display of
egotistical concerns, respondent said that obviously complainant took offense
because of what he considered his exalted position as chief of police.
Replying to respondents comment, complainant argues that Rule 21, 8 invoked
by respondent to justify her orders is not applicable. He points out that the orders
were intended not only to compel the attendance of policemen in court but also to
punish them for contempt of court. He also alleges that, contrary to respondents
statement in her order dated March 10, 1999, in Criminal Case Nos. C-55145(98) and
55146(98), that he did not make a return of the warrant of arrest against PO3 Nestor
Aquino, complainant says he made a return which, in fact, was received in
respondents court on March 10, 1999 at 10:22 a.m.[6]
Respondents order reads as follows:[7]
In an order of the court dated March 8, 1999, a warrant for the arrest of PO3 Nestor
Aquino, prosecutions witness in these cases were issued by the Court directing the
Chief of Police of Caloocan City or the duly authorized representative of the latter to
produce the body of the aforesaid police officer not later than March 10, 1999 at
8:30 oclock in the morning.
A cursory examination of the records will show that the order was received by the
Chief of Police of Caloocan City on the same date, March 8, 1999 but despite receipt
thereof, the Chief of Police of Caloocan City did not bother to make a return of the
warrant of arrest thereby delaying the early disposition of these cases.
Let it be stressed that this is a joint trial of Crim. Case No. 55145 (98) and Crim. Case
No. C-55146 (98) for the violation of the drugs law.
This indeed does not speak well of the Chief of Police of Caloocan City.
WHEREFORE, the Chief of Police of Caloocan City is hereby given a period of three
(3) days from receipt of a copy of this order to explain and to show cause why he
should not be cited in contempt of court for failure to produce today, March 10,
1999, the body of the afore-said witness.
Let copies of this order be furnished upon the Director of the Philippine National
Police (PNP) National Capital Judicial Region (NCJR), Bicutan, Metro Manila as well as
to the Director General of the PNP, Roberto Lastimosa for them to know the
actuation of the Chief of Police of Caloocan City in the discharged of its official
function.
Complainants return, bearing the stamp RTC, Branch 121, Caloocan, City,
received, 3/10/99, 10:22 a.m., reads:[8]
Date 10 March 1999
Respectfully returned to the Branch Clerk of Court RTC BR 121 Cal City the attached
Warrant/Order of Arrest in Crim. Case No. 55145-55146 (98) against PO3 NESTER
AQUINO with address at DDEU, NPDC, Tanigue St., Kaunlaran Vill, Caloocan City for
the crime of Non-appearance (at the scheduled hearing held on] 8 March 1999.
REASONS: UNSERVED. Subject PNP personnel was already dismissed from the
service effective 16 February 1999. Attached herewith is the xerox copy of Spl Order
No 366 relative to his dismissal.
Complainant adds that, in Caloocan City, only respondent issues orders to
policemen to serve court processes on short notice, and orders their arrest without
hearing in case they fail to comply without taking into account that they also have
other work to do. He states that he filed the instant complaint against respondent
not to cause her dishonor but to promote respect for the law and to correct the
misimpression that Caloocan City policemen are inefficient or defying court orders.
The Office of the Court Administration (OCA) recommends the dismissal of the
complaint against respondent for lack of merit. In its report, it states among other
things:
A cursory reading of the records of this case shows the utter lack of merit of
complainants cause.
Civil Procedure
First, a perusal of the questioned orders issued by the respondent reveals that the
subject policemen were not punished for contempt of court hence the contempt
provisions under the Revised Rules of Court is not applicable. Prior written charge
and hearing therefore is not necessary before Judge Angeles can issue warrant of
arrest to compel their attendance in court hearings;
Second, a judge is not prohibited to issue orders directing heads of police stations to
personally serve and return processes from the court;
Third, it cannot be considered as unreasonable the period given to complainant
within which to effect the service of the warrants of arrest issued by the court
considering that the police officers to be served by said warrants are working right at
the Station headed by the complainant himself; and
Lastly, on the charge that respondent arrogantly regarded the letter of complainant
as nothing but a display of egotistical concerns we are inclined to believe that the
respondents remarks were not tainted with malice and that her only concern is for
the speedy and efficient administration of justice.
Rule 21, 8, pursuant to which respondent issued her orders, states that in case
of failure of a witness to attend, the court or judge issuing the subpoena, upon proof
of the service thereof and of the failure of the witness, may issue a warrant to the
sheriff of the province, or his deputy, to arrest the witness and bring him before the
court or officer where his attendance is required. Respondent is thus correct in
contending that a judge may issue a warrant of arrest against a witness simply upon
proof that the subpoena had been served upon him but he failed to attend the
hearing. The purpose is to bring the witness before the court where his attendance
is required, not to punish him for contempt which requires a previous
hearing.[9] However, unnecessary tension and asperity could have been avoided had
respondent simply called the attention of complainant to the failure of the latters
men to comply with her orders instead of directing complainant to personally serve
the orders and bring the policemen himself to her sala.Moreover, as is clear from
Rule 21, 8, the orders of arrest should have been addressed to the sheriff or the
latters deputy. Respondent could have done this while calling complainants
attention to the alleged disregard by policemen of her orders so that appropriate
disciplinary action could be taken if necessary.
It would appear that respondents order of August 10, 1998 in Criminal Case
Nos. C-53625(98), 53626(98), 53622, and 53623(98), which provoked this incident
and gave rise to the word war between the parties, was made because respondent
thought that in the other cases (Criminal Case Nos. 55145(98) and 55146(98)) heard
that morning, complainant ignored her order to produce a policeman whom she had
ordered arrested. However, as already noted, the policeman could no longer be
presented in court as he had already been dismissed from the service, and
complainant did make a return informing the court of this fact, although his return
did reach the court a few hours after the hearing in which the policemans testimony
was required.
It was this unfortunate incident which provoked the exchanges between
complainant and respondent: respondent acting on the erroneous belief that
complainant had ignored her order and, consequently, requiring complainant to
personally arrest his own men and take them to her court, and complainant taking
umbrage at the orders. The observance of restraint was never more demanded on
the part of both parties.
Respondent acted a bit rashly while complainant reacted too strongly. The
courts and the law enforcers are two of the five pillars of the criminal justice system,
the other three being the prosecution, the correctional subsystem, and the
community.[10] Cooperation among, and coordination between, the five pillars are
needed in order to make the system work effectively. Indeed, complainant and
respondent both avow a common objective of dispensing justice. More than that,
the parties should observe mutual respect and forbearance.
WHEREFORE, respondent Judge Adoracion G. Angeles of the Regional Trial
Court, Branch 121, Caloocan City is ADMONISHED to be more circumspect in the
discharge of her judicial function with WARNING that repetition of the same or
similar acts will be dealt with more severely. The instant complaint is DISMISSED.
SO ORDERED.
Bellosillo, (Chairman), Quisumbing, and Buena, JJ., concur.
Civil Procedure
G.R. No. 214054, August 05, 2015 NG MENG TAM, VS. CHINA BANKING
CORPORATION,
DECISION VILLARAMA, JR., J.:
Before this Court is a direct recourse from the Regional Trial Court (RTC) via
petition[1] for review on the question of whether Section 5[2]of the Judicial Affidavit
Rule (JAR) applies to hostile or adverse witnesses. The petition seeks to annul and
set aside the May 28, 2014[3]and August 27, 2014[4] Orders of the RTC, Branch 139,
Makati City in Civil Case No. 08-1028.
This case stemmed from a collection suit filed by China Banking Corporation (China
Bank) against Ever Electrical Manufacturing Company Inc. (Ever), the heirs of Go
Tong, Vicente Go, George Go and petitioner Ng Meng Tam sometime in December
2008. China Bank alleged that it granted Ever a loan amounting to
P5,532,331.63. The loan was allegedly backed by two surety agreements executed
by Vicente, George and petitioner in its favor, each for P5,000,000.00, and dated
December 9, 1993 and May 3, 1995, respectively. When Ever defaulted in its
payment, China Bank sent demand letters collectively addressed to George, Vicente
and petitioner. The demands were unanswered. China Bank filed the complaint for
collection docketed as Civil Case No. 08-1028, which was raffled off to RTC Branch
62, Makati City.
In his Answer, petitioner alleged that the surety agreements were null and void since
these were executed before the loan was granted in 2004. Petitioner posited that
the surety agreements were contracts of adhesion to be construed against the entity
which drafted the same. Petitioner also alleged that he did not receive any demand
letter.
In the course of the proceedings, petitioner moved that his affirmative defenses be
heard by the RTC on the ground that the suit is barred by the statute of limitations
and laches.[5] The motion was denied by the court.[6] On appeal, the Court of Appeals
(CA) in its December 22, 2010 Decision[7] ruled that a preliminary hearing was proper
pursuant to Section 6,[8] Rule 16 of the Rules of Court due to the grounds cited by
petitioner. There being no appeal, the decision became final and executory on
August 28, 2011.[9]
On March 15, 2011, petitioner served interrogatories to parties[10] pursuant to
Sections 1[11] and 6,[12] Rule 25 of the Rules of Court to China Bank and required Mr.
George C. Yap, Account Officer of the Account Management Group, to answer.
On June 22, 2011, George Yap executed his answers to interrogatories to parties.[13]
In the meantime, having failed mediation and judicial dispute resolution, Civil Case
No. 08-1028 was re-raffled off to RTC Branch 139, Makati City.
Petitioner again moved for the hearing of his affirmative defenses. Because he
found Yap’s answers to the interrogatories to parties evasive and not responsive,
petitioner applied for the issuance of a subpoena duces tecum and ad
testificandum against George Yap pursuant to Section 6,[14] Rule 25 of the Revised
Rules of Court.
On April 29, 2014, when the case was called for the presentation of George Yap as a
witness, China Bank objected citing Section 5 of the JAR. China Bank said that Yap
cannot be compelled to testify in court because petitioner did not obtain and
present George Yap’s judicial affidavit. The RTC required the parties to submit their
motions on the issue of whether the preparation of a judicial affidavit by George Yap
as an adverse or hostile witness is an exception to the judicial affidavit rule. [15]
Petitioner contended that Section 5 does not apply to Yap because it specifically
excludes adverse party witnesses and hostile witnesses from its
application. Petitioner insists that Yap needed to be called to the stand so that he
may be qualified as a hostile witness pursuant to the Rules of Court.
China Bank, on the other hand, stated that petitioner’s characterization of Yap’s
answers to the interrogatories to parties as ambiguous and evasive is a declaration
of what type of witness Yap is. It theorizes that the interrogatories to parties
answered by Yap serve as the judicial affidavit and there is no need for Yap to be
qualified as a hostile witness.
In its May 28, 2014 Order, the RTC denied for lack of merit petitioner’s motion to
examine Yap without executing a judicial affidavit. The RTC in interpreting Section 5
of the JAR stated:
Civil Procedure
x x x The aforementioned provision, which allows the requesting party to avail
himself of the provisions of Rule 21 of the Rules of Court finds applicability to: (a) a
government employee or official, or the requested witness, who is neither the
witness of the adverse party nor a hostile witness and (b) who unjustifiably declines
to execute a judicial affidavit or refuses without just cause to make the relevant
books, documents, or other things under his control available for copying,
authentication, and eventual production in court.
In the case at bar, witness George Yap is being utilized as an adverse witness for the
[petitioner]. Moreover, there was no showing that he unjustifiably declines to
execute a judicial affidavit. In fact, it was [China Bank]’s counsel who insisted that
said witness’ judicial affidavit be taken. Thus, Section 5 of the [JAR] which
[petitioner] invoked to exempt him from the Rule finds no application. Unless there
is contrary ruling on the matter by the Supreme Court, this court has no choice but
to implement the rule as written.
On this note, this Court also finds no merit on the contention of [China Bank] that
the answer to the written interrogatories by witness George Yap already constitutes
his judicial affidavit. Inasmuch as the Court strictly implemented the [JAR] on the
part of [petitioner], so shall it rule in the same manner on the part of [China
Bank]. As correctly pointed out by [petitioner], the said answer to interrogatories
does not comply with Section 3 of the [JAR] which provides for the contents of the
judicial affidavit.[16]
In essence, the RTC ruled that Section 5 did not apply to Yap since he was an adverse
witness and he did not unjustifiably decline to execute a judicial affidavit. It stated:
In view of the foregoing, the motion of the [petitioner] that witness George Yap be
examined without executing a Judicial Affidavit is hereby DENIED FOR LACK OF
MERIT.[17]
Petitioner moved for reconsideration but it was denied by the RTC in its August 27,
2014 Order.[18] The RTC reiterated its position and stated:
It must be pointed out that the [petitioner] [was] the [one] who invoked the
provisions of Section 5 of the [JAR] to compel the attendance of witness George Yap
and as such, it is their duty to show the applicability of the said provisions to the
case at bar. As stated in the challenged Order, Section 5 of the [JAR] finds
applicability to: (a) a government employee or official, or the requested witness,
who is neither the witness of the adverse party nor a hostile witness and (b) who
unjustifiably declines to execute a judicial affidavit or refuses without just cause to
make the relevant books, documents, or other things under his control available for
copying, authentication, and eventual production in court. In the case at bar,
[petitioner] [does] not deny that witness George Yap is to be utilized as [his] adverse
witness. On this score alone, it is clear that the provisions invoked do not apply. [19]
The RTC stressed that Section 5 of the JAR required the requested witness’ refusal to
be unjustifiable. It stated:
x x x the [JAR] requires that the refusal must be unjustifiable and without just
cause. It must be pointed out that [China Bank]’s previous motions to quash the
subpoena was grounded on the claim that having already submitted to this court his
sworn written interrogatories, his being compelled to testify would be unreasonable,
oppressive and pure harassment. Thus, witness’ refusal to testify cannot be
considered unjustifiable since he raised valid grounds.[20]
Hence, this petition.
Petitioner contends that the RTC committed a grave error when it interpreted
Section 5 to include adverse party and hostile witnesses. Based on the wording of
Section 5, adverse party and hostile witnesses are clearly excluded.
China Bank asserts that Yap neither refused unjustifiably nor without just cause
refused to a judicial affidavit. It cited the RTC’s August 27, 2014 Order where the
court said that Yap had answered the interrogatories and to compel him to testify in
open court would be “unreasonable, oppressive and pure harassment.” Moreover,
it stated that based on the language used by Section 2 of the JAR the filing of judicial
affidavits is mandatory.
The petition is anchored on the following arguments:
Civil Procedure
I. RTC BR. 139-MAKATI COMMITTED AN ERROR OF LAW WHEN IT INTERPRETED Here, parties were presenting their evidence for the RTC’s consideration when the
SEC. 5 OF THE [JAR] CONTRARY TO ITS WORDINGS. JAR took effect. Therefore, pursuant to Section 12 the JAR applies to the present
collection suit.
II. RTC BR. 139-MAKATI COMMITTED AN ERROR OF LAW WHEN IT INTERPRETED
SEC. 5 [OF THE JAR] CONTRARY TO ITS PRACTICAL INTENTION AND COMMON SENSE. SECTION 5 OF THE JAR DOES NOT APPLY TO ADVERSE PARTY WITNESSES

III. RTC BR. 139-MAKATI COMMITTED AN ERROR OF LAW WHEN IT EFFECTIVELY The JAR primarily affects the manner by which evidence is presented in
DISREGARDED THE RELEVANT RULES ON MODE OF DISCOVERY WHICH GOVERN THE court. Section 2(a) of the JAR provides that judicial affidavits are mandatorily filed
PRESENTATION OF ADVERSE WITNESSES. by parties to a case except in small claims cases. These judicial affidavits take the
place of direct testimony in court. It provides:
IV. ON A POLICY LEVEL AND IN THE EVENT RTC BR. 139-MAKATI’S
INTERPRETATION AND APPLICATION OF SEC. 5 OF THE [JAR] IS CORRECT (I.E., THAT Sec. 2. Submission of Judicial Affidavits and Exhibits in lieu of direct testimonies. – (a)
OPPOSING PARTY WHO INTENDS TO PRESENT ADVERSE OR HOSTILE WITNESS MUST The parties shall file with the court and serve on the adverse party, personally or by
GET AND SUBMIT THAT WITNESS’ JUDICIAL AFFIDAVIT NO MATTER WHAT) IT IS licensed courier service, not later than five days before pre-trial or preliminary
HUMBLY SUBMITTED, WITH THE UTMOST INDULGENCE OF THE HONORABLE conference or the scheduled hearing with respect to motions and incidents, the
SUPREME COURT, THAT THE SAME RULE BE IMPROVED OR AMENDED BY following:
PROVIDING SANCTIONS IN THE EVENT THE ADVERSE OR HOSTILE WITNESS REFUSES
TO ANSWER OR EXECUTE JUDICIAL AFFIDAVIT AS REQUIRED BY THE OPPOSING (1) The judicial affidavits of their witnesses, which shall take the place of such
PARTY.[21] witnesses’ direct testimonies; and

We grant the petition. (2) The parties’ documentary or object evidence, if any, which shall be attached to
the judicial affidavits and marked as Exhibits A, B, C, and so on in the case of the
THE JUDICIAL AFFIDAVIT RULE APPLIES TO PENDING CASES complainant or the plaintiff, and as Exhibits 1, 2, 3, and so on in the case of the
respondent or the defendant.
On September 4, 2012, the JAR was promulgated to address case congestion and
delays in courts. To this end, it seeks to reduce the time needed to take witnesses’ Section 3[24] of the JAR enumerates the content of a judicial affidavit.
testimonies.[22] The JAR took effect on January 1, 2013 and would also apply to
pending cases pursuant to Section 12 to wit: Under Section 10,[25] parties are to be penalized if they do not conform to the
provisions of the JAR. Parties are however allowed to resort to the application of a
Sec. 12. Effectivity. – This rule shall take effect on January 1, 2013 following its subpoena pursuant to Rule 21 of the Rules of Court in Section 5 of the JAR in certain
publication in two newspapers of general circulation not later than September 15, situations. Section 5 provides:
2012. It shall also apply to existing cases. (Emphasis supplied)
Sec. 5. Subpoena. – If the government employee or official, or the requested
The Court En Banc gave public prosecutors in first and second level courts one year witness, who is neither the witness of the adverse party nor a hostile witness,
of modified compliance.[23] The JAR thus took full effect on January 1, 2014. unjustifiably declines to execute a judicial affidavit or refuses without just cause to
make the relevant books, documents, or other things under his control available for
Civil Procedure
copying, authentication, and eventual production in court, the requesting party may
avail himself of the issuance of a subpoena ad testificandum or duces tecum under
Rule 21 of the Rules of Court. The rules governing the issuance of a subpoena to the
witness in this case shall be the same as when taking his deposition except that the
taking of a judicial affidavit shal1 be understood to be ex parte.
While we agree with the RTC that Section 5 has no application to Yap as he was
presented as a hostile witness we cannot agree that there is need for a finding that
witness unjustifiably refused to execute a judicial affidavit.
Section 5 of the JAR contemplates a situation where there is a (a) government
employee or official or (b) requested witness who is not the (1) adverse party’s
witness nor (2) a hostile witness. If this person either (a) unjustifiably declines to
execute a judicial affidavit or (b) refuses without just cause to make the relevant
documents available to the other party and its presentation to court, Section 5
allows the requesting party to avail of issuance of subpoena ad
testificandum or duces tecum under Rule 21 of the Rules of Court. Thus, adverse
party witnesses and hostile witnesses being excluded they are not covered by
Section 5. Expressio unius est exclusion alterius: the express mention of one person,
thing, or consequence implies the exclusion of all others.[26]
Here, Yap is a requested witness who is the adverse party’s witness. Regardless of
whether he unjustifiably declines to execute a judicial affidavit or refuses without
just cause to present the documents, Section 5 cannot be made to apply to him for
the reason that he is included in a group of individuals expressly exempt from the
provision’s application.
The situation created before us begs the question: if the requested witness is the
adverse party’s witness or a hostile witness, what procedure should be followed?
The JAR being silent on this point, we turn to the provisions governing the rules on
evidence covering hostile witnesses specially Section 12, Rule 132 of the Rules of
Court which provides:
SEC. 12. Party may not impeach his own witness. – Except with respect to witnesses
referred to in paragraphs (d) and (e) of Section 10, the party producing a witness is
not allowed to impeach his credibility.
A witness may be considered as unwilling or hostile only if so declared by the court
upon adequate showing of his adverse interest, unjustified reluctance to testify, or
his having misled the party into calling him to the witness stand.
The unwilling or hostile witness so declared, or the witness who is an adverse party,
may be impeached by the party presenting him in all respects as if he had been
called by the adverse party, except by evidence of his bad character. He may also be
impeached and cross-examined by the adverse party, but such cross-examination
must only be on the subject matter of his examination-in-chief.
Before a party may be qualified under Section 12, Rule 132 of the Rules of Court, the
party presenting the adverse party witness must comply with Section 6, Rule 25 of
the Rules of Court which provides:
SEC. 6. Effect of failure to serve written interrogatories. – Unless thereafter allowed
by the court for good cause shown and to prevent a failure of justice, a party not
served with written interrogatories may not be compelled by the adverse party to
give testimony in open court, or to give a deposition pending appeal.
In Afulugencia v. Metropolitan Bank & Trust Co.,[27] this Court stated that “in civil
cases, the procedure of calling the adverse party to the witness stand is not allowed,
unless written interrogatories are first served upon the latter.”[28] There petitioners
Spouses Afulugencia sought the issuance of a subpoena duces tecum and ad
testificandum to compel the officers of the bank to testify and bring documents
pertaining to the extrajudicial foreclosure and sale of a certain parcel of
land. Metrobank moved to quash the issuance of the subpoenas on the ground of
non-compliance with Section 6, Rule 25 of the Rules of Court. In quashing the
issuance of the subpoena, the Court reminded litigants that the depositions are a
mechanism by which fishing expeditions and delays may be avoided. Further written
interrogatories aid the court in limiting harassment and to focus on what is essential
to a case. The Court stated:
Civil Procedure
One of the purposes of the above rule is to prevent fishing expeditions and needless
delays; it is there to maintain order and facilitate the conduct of trial. It will be
presumed that a party who does not serve written interrogatories on the adverse
party beforehand will most likely be unable to elicit facts useful to its case if it later
opts to call the adverse party to the witness stand as its witness. Instead, the
process could be treated as a fishing expedition or an attempt at delaying the
proceedings; it produces no significant result that a prior written interrogatories
might bring.
Besides, since the calling party is deemed bound by the adverse party’s testimony,
compelling the adverse party to take the witness stand may result in the calling
party damaging its own case. Otherwise stated, if a party cannot elicit facts or
information useful to its case through the facility of written interrogatories or other
mode of discovery, then the calling of the adverse party to the witness stand could
only serve to weaken its own case as a result of the calling party’s being bound by
the adverse party’s testimony, which may only be worthless and instead detrimental
to the calling party’s cause.
Another reason for the rule is that by requiring prior written interrogatories, the
court may limit the inquiry to what is relevant, and thus prevent the calling party
from straying or harassing the adverse party when it takes the latter to the stand.
interposed its objection for non-compliance with Section 5 of the JAR. Having
established that Yap, as an adverse party witness, is not within Section 5 of the JAR’s
scope, the rules in presentation of adverse party witnesses as provided for under the
Rules of Court shall apply. In keeping with this Court’s decision in Afulugencia, there
is no reason for the RTC not to proceed with the presentation of Yap as a witness.
In sum, Section 5 of the JAR expressly excludes from its application adverse party
and hostile witnesses. For the presentation of these types of witnesses, the
provisions on the Rules of Court under the Revised Rules of Evidence and all other
correlative rules including the modes of deposition and discovery rules shall apply.
WHEREFORE, the petition is GRANTED. The May 28, 2014 and August 27, 2014
Orders of the Regional Trial Court, Branch 139, Makati City are
hereby ANNULLED and SET ASIDE.
No pronouncement as to costs.
SO ORDERED.
Velasco, Jr., (Chairperson), Peralta, Perez,* and Jardeleza, JJ., concur.

Thus, the rule not only protects the adverse party from unwarranted surprises or
harassment; it likewise prevents the calling party from conducting a fishing
expedition or bungling its own case. Using its own judgment and discretion, the
court can hold its own in resolving a dispute, and need not bear witness to the
parties perpetrating unfair court practices such as fishing for evidence, badgering, or
altogether ruining their own cases. Ultimately, such unnecessary processes can only
constitute a waste of the court’s precious time, if not pointless
entertainment.[29] (Citation omitted)

In this case, parties, with the approval of the Court, furnished and answered
interrogatories to parties pursuant to Rule 25 of the Rules of Court. They therefore
complied with Section 6 of Rule 25 of the Rules of Court. Before the present
controversy arose, the RTC had already issued subpoenas for Yap to testify and
produce documents. He was called to the witness stand when China Bank
Civil Procedure
G.R. No. 137136. November 3, 1999 NORTHWEST AIRLINES, INC., vs. CAMILLE T.
CRUZ and COURT OF APPEALS
D E C I S I O N KAPUNAN, J.:
Before this Court is a petition for review on certiorari of the Decision of the
Court of Appeals, dated September 30, 1998; and, of its Resolution, dated January
11, 1999.
The antecedent facts are as follows:
On August 24, 1992, herein private respondent Camille T. Cruz, then a teenage
girl who would be travelling alone for the first time, purchased from petitioner
Northwest Airlines a round-trip ticket for a flight from Manila to Boston via Tokyo
and back. The scheduled departure date from Manila to Boston was August 27, 1992
at 8:40 a.m. in economy class while the scheduled return flight from Boston to
Manila in business class was on December 22, 1992 at 10:25 a.m.[1]
On November 25, 1992, private respondent re-scheduled her return flight from
Boston to Manila to December 17, 1992 at 10:05 a.m. Accordingly, petitioner
booked her on Northwest flight NW005 C (Flight 5) with route as follows: Boston to
Chicago; Chicago to Tokyo; and, Tokyo to Manila.[2]
Petitioner reconfirmed the flight from Boston, U.S.A. to Manila scheduled on
December 17, 1992 at least seventy-two (72) hours prior to the said scheduled
flight.[3]
However, barely a day before the scheduled date of departure, petitioner called
private respondent and informed her that instead of following her original itinerary
of Boston to Chicago; Chicago to Tokyo; and, Tokyo to Manila, private respondent
should instead board the TWA flight from Boston to Kennedy International Airport in
New York. Private respondent was further instructed by petitioner to proceed to the
latters counter at the Logan Airport in Boston before boarding the TWA flight on the
scheduled date of departure.[4]
On December 17, 1992, upon petitioners instructions, private respondent
proceeded early to the petitioners counter at Logan Airport in Boston but was
referred to the TWA counter where she was informed that she may not be able to
take the TWA flight. Notwithstanding this uncertainty, private respondent was made
to proceed to the International Gate where she was informed that the TWA flight
she was to take to Kennedy International Airport in New York was cancelled.[5]
Due to the unexplained and belated cancellation of the TWA flight, private
respondent had to rush back from the International Gate to petitioners counter in
Logan Airport in Boston where she was again told to proceed immediately to the
Delta Airlines terminal to catch the Delta Airlines flight to La Guardia Airport in New
York and thence took the service car to Kennedy Airport in New York.[6]
In her haste to catch the said flight, private respondent tripped and fell down on
her way from petitioners counter to the Delta Airlines counter in Logan Airport in
Boston thereby suffering slight physical injuries and embarrassment.[7]
When private respondent reached La Guardia Airport in New York, she again
had to rush to the service car that would take her to Kennedy International Airport
which is several miles away from La Guardia. In her haste and anxiety to catch her
flight, private respondent again tripped and fell down thereby suffering more
physical injuries, embarrassment and great inconvenience.[8]
Private respondents apprehension was further aggravated when she was
informed at petitioners counter in Kennedy International Airport that she was issued
the wrong ticket to Seoul instead of Tokyo.Although the error was rectified by
petitioner at Kennedy International Airport, private respondent was by then
extremely nervous, worried, stressed out, and exhausted.[9]
To make matters worse, petitioner downgraded private respondent from
business class to economy class on two legs of her flight without notice nor
apology. Neither did petitioner offer to refund the excess fare private respondent
paid for a business class seat.[10]
Hence, on August 6, 1993, private respondent filed a complaint [11] against
petitioner Northwest Airlines, Inc. for breach of contract of carriage committed
when petitioner changed private respondents original itinerary of Boston to Chicago,
Chicago to Tokyo, Tokyo to Manila to a new itinerary of Boston to New York, New
York to Tokyo and Tokyo to Manila, thereby downgrading private respondent on two
legs of her return flight to Manila from business to economy class (flights from
Boston to New York, and from Tokyo to Manila). Private respondent claimed to have
suffered actual, moral and exemplary damages.[12]
Civil Procedure
Petitioner filed its answer with compulsory counterclaim alleging therein that our customers with rebooking for protection some other main
the flight on which private respondent was originally booked was cancelled due to customer services.
maintenance problems and bad weather,[13] and that the airline had done its best to
ATTY. AUTEA Have you ever been come across the name of Camille T. Cruz
re-book private respondent on the next available flights.
in connection with a canceled Northwest flight?
Trial progressed until 1995 when it was petitioners turn to present its witness
MR. GARZA Yes, I have.
on three scheduled dates. Two of the settings were cancelled when petitioners
counsel filed notice for oral deposition of one Mario Garza, witness for petitioner, in xxx.
New York. Private respondent filed her opposition and suggested written
ATTY. AUTEA Based on this passenger name record marked as Exhibit 2 and
interrogatories instead. However, in an Order dated July 26, 1995, the trial court
the transcript marked as Exhibit 3, very briefly can you tell us
denied private respondents opposition, thus allowing the deposition to proceed. The
what was the original flight schedule of Camille T. Cruz on her
oral deposition took place in New York on July 24, 1995[14] or notably two days
return flight from Boston to Manila on December 17, 1992?
before the issuance of the trial courts order allowing the deposition to proceed.
MR. GARZA It actually she goes back a little before that, she was booked
The records show that although it was the Honorable Consul Milagros R. Perez
originally to return to Manila on the 22nd of December and she
who swore in the deponent,[15] she thereafter designated one Attorney Gonzalez as
was advised of the schedule change wherein Northwest
Deposition Officer.[16] After stating his personal circumstances, Mr. Mario Garza,
changed the flight number from Northwest Flight 3 to
testified as follows:
Northwest Flight 5 and then on the 14th of October the
xxx. reservation from, I can tell here for the customer was changed
from the 22nd of December to 17th of December, Boston to
ATTY. AUTEA What is your present position?
Manila.
MR. GARZA I am currently a customer service supervisor and instructor for
ATTY. AUTEA Okay. You said that there was a change of flight from
Northwest in Boston.
Northwest Flight 3 to Northwest Flight 5, what brought about
ATTY. AUTEA In or about December 1992, what was your position? the change?
MR. GARZA I was a customer service supervisor and instructor. MR. GARZA There was a schedule change and during schedule changes
sometime, anytime theres a change in departure time or
ATTY. AUTEA As a customer service supervisor and instructor what are the
change in flight number and thats referred as a schedule
duties which you discharged?
change if there is a phone contact we are advised to contact
MR. GARZA My responsibilities are in Boston field work to oversee the the customers so they will know what flight they are supposed
ground staff and for the employees of Northwest who work at to be on.
the counter, gates, luggage service operations.
ATTY. AUTEA And and (sic) that does it show there as it is stated in the
ATTY. AUTEA Do you discharge any responsibilities in connection with complaint filed by the plaintiff that she requested for the
canceled flights? change from December 22 to December 17?
MR. GARZA Yes, I do. If a flight is canceled it is my responsibility amongst MR. GARZA Yes.
many supervisor, to determine how we are gonna best serve
Civil Procedure
ATTY. AUTEA Now under this uh-- new flight schedule Northwest Flight 5, ATTY. AUTEA And the first option is that written in Item Number 8, is that
what was the itinerary of Camille T. Cruz? right?
MR. GARZA Flight 5 is referred to as Direct Flight from Boston to Manila, MR. GARZA That is correct.
uhh--the routing for that flight goes Boston Chicago, Tokyo-
ATTY. AUTEA The second option is that written in Item Number 9 of Exhibit
Manila with a change of equipment and it is a change of
3, is that right?
aircraft type in Chicago.
MR. GARZA That is correct.
ATTY. AUTEA Okay. What happened to that flight? Northwest Flight 5? The
originally first leg of which was Boston to Chicago? ATTY. AUTEA And who made the decision for Camille T. Cruz as to which
option to take?
MR. GARZA On the 17th, Flight 5 from Boston to Chicago canceled due to
maintenance problem. MR. GARZA In this case to me it would be the customer, because we
would always have to go with what the customer wants.
xxx.
ATTY. AUTEA When you say that it was the customer who made the
ATTY. AUTEA Ahh. In other words Mr. Garza, the aircraft which the plaintiff
decision you are referring to Camille T. Cruz the plaintiff in this
in this case was scheduled to take came from Washington
case?
D.C., is that right?
MR. GARZA Thats correct.
MR. GARZA That is correct.
ATTY. AUTEA In other words Camille T. Cruz, the plaintiff was the one who
ATTY. AUTEA And from Washington DC that aircraft flew to Boston is that
chose the alternate flight shown in Item Number 9 of Exhibit
right?
3?
MR. GARZA Well it supposed to fly it is it didn’t fly.
MR. GARZA Thats correct.
ATTY. AUTEA It was supposed to fly but it didnt fly?
xxx.
MR. GARZA That is correct.
ATTY. AUTEA Why in coach?
ATTY. AUTEA What is the reason for the inability of the aircraft to fly from
MR. GARZA I would say because that was what all that was available, she
Washington DC to Boston?
is a business class passenger and there is no business class on
MR. GARZA Based on this messages says Emergency Lights INOP and domestic flights, we do upgrade our business class passenger
unable to repair. to first class domestically on a space available basis so they
would indicate to me that possibly from Detroit was probably
xxx.
already sold out in first class but we would be able to confirm
ATTY. AUTEA In other words Mr. Garza, when the original Northwest Flight her in coach but a smaller flight.
Number 5 of the passenger Camille T. Cruz was canceled due
ATTY. AUTEA Are you saying that because of the cancellation of the original
to maintenance work she was given two options, is that right?
flight of Camille T. Cruz, Northwest tried to book the
MR. GARZA Yes.
Civil Procedure
passenger on the available flight but that the available flight
which was then available was this coach class Northwest 440?
MR. GARZA Thats correct, from Boston to Detroit.
xxx.
ATTY. AUTEA Okay. The second leg of this trip in Item Number 9 says NW
017 F JFKNRT 17th December 1240 to 1700, what does that
mean?
MR. GARZA That means that we re-booked it from New York Kennedy to
Tokyo non-stop Narita Airport on Northwest Flight 17 in first
class as opposed to business class and that left Kennedy at
1240 arriving into Tokyo at 1700.
ATTY. AUTEA Why was she booked in first class?
MR. GARZA Again I would say that business class was already sold out on
that flight so since she already been inconvenience before we
are allowed at the airport under types of circumstances then
to move the business class passenger into first class.
xxx.
ATTY. AUTEA Now, the third leg of the trip under Item Number 9 of Exhibit 3
says NW 005 Y NRT MNI, 18th December 1815 to 2155, what
does that mean?
MR. GARZA That means that upon arriving in Tokyo she would connect to
Flight 5 from Tokyo to Manila on the 18th departing at 1815
and arriving at 2155 and that was booked in coach.
ATTY. AUTEA Why was she booked in coach?
MR. GARZA I was again in uhh. Because first and business class would have
been sold out.[17]
On November 9, 1995, at the hearing of the instant case, petitioner presented
the deposition record of its witness while private respondent reserved her right to
cross-examine and present rebuttal evidence.
Private respondent, likewise, questioned the conduct of the oral deposition as
irregular and moved for suppression of the same on the following grounds:
1. The deposition has been improperly and irregularly taken and returned in that:
(a) The deposition was taken on July 24, 1995 despite the fact that this
Honorable Court only ruled on the matter on July 26, 1995.
(b) There is no certification given by the officer taking the deposition that the
same is a true record of the testimony given by the deponent in violation of
Rule 24, Section 20 of the Rules of Court.
(c) The deposition was not securely sealed in an envelope indorsed with the title
of the action and marked Deposition of (here insert the name of witness) in
violation of Rule 24, Section 20 of the Rules of Court.
(d) The officer taking the deposition did not give any notice to the plaintiff of the
filing of the deposition in violation of Rule 24, Section 21 of the Rules of
Court.
(e) The person designated as deposition officer is not among those persons
authorized to take deposition in foreign countries in violation of Rule 24,
Section 11 of the Rules of Court.
(f) There is no showing on record that the deponent read and signed the
deposition in violation of Rule 24, Section 19 of the Rules of Court.
2. These irregularities or defects were discovered by the plaintiff during the hearing
on November 9, 1995 and plaintiff has acted with reasonable promptness after
having ascertained the existence of the aforesaid irregularities and defects.[18]
However, private respondents motion was denied anew by the trial court.[19] In
its Order, dated July 23, 1996, the trial court admitted petitioners formal offer of
evidence with supplement thereto and gave private respondent three days from
receipt within which to signify her intention to present rebuttal evidence.
On August 2, 1996, private respondent filed a manifestation and motion stating
that the court failed to rule on its motion to suppress deposition and to grant her
the right to cross-examine petitioners deponent. Private respondent also manifested
her intention to present rebuttal evidence.
In its Order, dated September 5, 1996, the trial court denied private
respondents manifestation and motion. Said court, likewise, denied private
Civil Procedure
respondents motion for reconsideration of the above order.Hence, private
respondent filed a petition for certiorari with the Court of Appeals on April 7,
1998.[20]
On September 30, 1998, the appellate court rendered a Decision, the dispositive
portion of which reads:
WHEREFORE, the petition is GRANTED. The questioned rulings of the Regional Trial
Court are hereby SET ASIDE, and judgment is hereby rendered ORDERING the
court a quo to disallow the deposition and continue with the trial of the case
without prejudice to petitioners right to cross examine defendants witness and to
present rebuttal evidence.
SO ORDERED.[21]
Petitioner Northwest, thereafter, filed this instant petition for review alleging
that:
I. THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN NOT
DISMISSING THE PETITION OUTRIGHT SINCE THE REMEDY OF APPEAL IS
AVAILABLE TO PRIVATE RESPONDENT.BESIDES, THE PETITION WAS FILED
OUT OF TIME.
II. THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN FINDING
THAT THE TRIAL COURT GRAVELY ABUSED ITS DISCRETION BY
ADMITTING INTO EVIDENCE THE ORAL DEPOSITION.
III.THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN FINDING
THAT PRIVATE RESPONDENT HAS NOT WAIVED HER RIGHT TO CROSS-
EXAMINE PETITIONERS WITNESS AND TO PRESENT REBUTTAL
EVIDENCE.[22]
Petitioner argues that the remedy of certiorari before respondent Court of
Appeals was improper, as private respondent has every opportunity to question on
appeal the trial courts ruling admitting the deposition.
According to petitioner, a careful analysis of the petition in the Court of Appeals
shows that at the heart of the issues raised is the correctness of the procedure
observed by the trial court in appreciating the admissibility of the transcript of the
deposition of Mr. Mario Garza. Such being the case, assuming without admitting
that the trial court committed any error in issuing the questioned orders, such error
is only an error of judgment, and not an error of jurisdiction.
Petitioner further asserts that the trial court did not gravely abuse its discretion
by admitting into evidence the oral deposition. While as a general rule, Section 1,
Rule 132 of the Rules of Court[23]governs the conduct of trial, this rule admits of
exceptions which this Court recognized in the case of Dasmarinas Garments, Inc. vs.
Reyes.[24] According to petitioner, one of the exceptions is when the witness is out of
the Philippines. In this case, petitioner has the right to take the deposition of its
witness and offer it in evidence since Mr. Mario Garza resides and works outside the
Philippines. The deposition-taking at the Philippine Consulate in New York City falls
within the exceptions to the requirement that a witness give his testimony in open
court pursuant to Section 1, Rule 132 of the Rules.
Finally, petitioner alleges that private respondent must be deemed to have
waived her right to cross-examine petitioners witness and her right to present
rebuttal evidence by her failure to attend the deposition-taking despite due notice
thereof, or at the very least, to timely reserve her right to serve written
interrogatories.
Petitioners arguments are untenable.
Section 16 of Rule 24 (now Rule 23 of the Rules of Civil Procedure of 1997)
provides that after notice is served for taking a deposition by oral examination, upon
motion seasonably made by any party or by the person to be examined and for good
cause shown, the court in which the action is pending may, among others, make an
order that the deposition shall not be taken. The rest of the same section allows the
taking of the deposition subject to certain conditions specified therein.
The provision explicitly vesting in the court the power to order that the
deposition shall not be taken connotes the authority to exercise discretion on the
matter. However, the discretion conferred by law is not unlimited. It must be
exercised, not arbitrarily or oppressively, but in a reasonable manner and in
consonance with the spirit of the law. The courts should always see to it that the
safeguards for the protection of the parties and deponents are firmly maintained. As
aptly stated by Chief Justice Moran:
xxx. (T)his provision affords the adverse party, as well as the deponent, sufficient
protection against abuses that may be committed by a party in the exercise of his
Civil Procedure
unlimited right to discovery. As a writer said: Any discovery involves a prying into
another persons affairs prying that is quite justified if it is to be a legitimate aid to
litigation, but not justified if it is not to be such an aid. For this reason, courts are
given ample powers to forbid discovery which is intended not as an aid to litigation,
but merely to annoy, embarrass or oppress either the deponent or the adverse
party, or both.[25]
Respondent court correctly observed that the deposition in this case was not
used for discovery purposes, as the examinee was the employee of petitioner, but
rather to accommodate the former who was in Massachusetts, U.S.A. Such being the
case, the general rules on examination of witnesses under Rule 132 of the Rules of
Court requiring said examination to be done in court following the order set therein,
should be observed.
Respondent court also correctly noted that private respondents objections to
the oral deposition had been made promptly and vehemently, as required by the
Rules, but these were wrongly disregarded as immaterial by the trial court.
We note with approval respondent courts ruling disallowing the depositions and
upholding private respondents right to cross-examine:
xxx [The] deposition was not a mode of discovery but rather a direct testimony by
respondents witness and there appears a strategy by respondent to exclude
petitioners participation from the proceedings.
While a months notice would ordinarily be sufficient, the circumstances in this case
are different. Two days of trial were cancelled and notice for oral deposition was
given in lieu of the third date. The locus of oral deposition is not easily within reach
of ordinary citizens for it requires time to get a travel visa to the United States, book
a flight in July to the United States, and more importantly substantial travel fare is
needed to obtain a round trip ticket by place (sic) from Manila to New York and back
to Manila.
As an international carrier, Northwest could very conveniently send its counsel to
New York. However, the ends of justice would have been better served if the
witness were instead brought to the Philippines.Written interrogatories was (sic)
requested to balance this inconvenience which was nonetheless also objected to
and denied for simply being time consuming. While time is a factor in deciding cases,
the more important principles would have been the thorough presentation and
deliberation of a case to ensure that the ends of justice are met since this is the
principal mission of a civilized judicial system.
The objections raised by petitioner [private respondent], in the light of the above
considerations, take on a greater weight. Section 11 of Rule 24 provides: In a foreign
state or country, depositions shall be taken (a) on notice before a secretary of
embassy or legation, consul general, consul, vice-consul or consular agent of the
Republic of the Philippines, or (b) before such person or officer as may be appointed
by commission or under letters rogatory. The deposition document clearly indicates
that while the consul swore in the witness and the stenographer, it was another
officer in the Philippine Consulate who undertook the entire proceedings
thereafter. Respondent Northwest argues on the presumption of regularity of
official functions and even obtained a certification to this effect plus an assertion
that none of the participants in the Consulate were in any way related to the
respondent or their counsel. But presumptions should fail when the record itself
bears out the irregularity.
The Rules (Rule 24, Sec. 29) indicate that objections to the oral deposition will be
waived unless the objections are made with reasonable promptness. In this case, the
objections have been prompt and vehement, yet they were disregarded as not
material such that the deposition and the exhibits related thereto were
admitted. Moreover, a Supplemental Offer of Evidence pertaining to a certification
by the consul in New York which tends to correct the objections raised was also
admitted by the Court. Respondents argue that the rules were not exactly
mandatory but merely guides to ensure that the ends of justice are met. The Court
interpreted with leniency the objections despite the acknowledged mandatory
language of the rules.
There is clear language of the law and the same should not be modified in
practice. The separate certification of the FSO from the transcript proper was also
questioned as irregular by petitioner [private respondent]. In so doing, she was
merely being vigilant of her rights considering that she was not present then. No
other proof thereon is needed when the same is clear on the face of the deposition
material given.
Civil Procedure
Petitioners [private respondent] right to cross examine and to present rebuttal Davide, Jr., C.J., (Chairman), and Pardo, JJ., concur.
evidence, having been reserved earlier, needed no reiteration. Even then, this was Puno, and Ynares-Santiago, J., on official business abroad.
nevertheless manifested and even vehemently argued. As defendants oral
deposition was admitted, despite substantial issues raised against it in the interest
of justice, similar consideration, aside from substantial and technical basis, also
dictates that petitioners [private respondent] right to cross-examine and present
rebuttal evidence should be granted. An even handed treatment of the parties
would require the same attitude towards the acceptance of petitioners [private
respondents] right to cross-examine and present its rebuttal evidence on the
same.[26]

In Fortune Corporation vs. Court of Appeals,[27] this Court set aside upon review
by certiorari the order of the trial court allowing deposition because the order did
not conform to the essential requirements of law and may reasonably cause
material injury to the adverse party:
The rule is that certiorari will generally not lie to review a discretionary action of
any tribunal. Also, as a general proposition, a writ of certiorari is available only to
review final judgment or decrees, and will be refused where there has been no final
judgment or order and the proceeding for which the writ is sought is still pending
and undetermined in the lower tribunal. Pursuant to this rule, it has been held that
certiorari will not lie to review or correct discovery orders made prior to trial. This is
because, like other discovery orders, orders made under Section 16, Rule 24 are
interlocutory and not appealable considering that they do not finally dispose of the
proceeding or of any independent offshoot of it.
However, such rules are subject to the exception that discretionary acts will be
reviewed where the lower court or tribunal has acted without or in excess of its
jurisdiction, where an interlocutory order does not conform to essential
requirements of law and may reasonably cause material injury throughout the
subsequent proceedings for which the remedy of appeal will be inadequate, or
where there is a clear or serious abuse of discretion.
IN VIEW OF THE FOREGOING, the Court hereby DENIES the petition for failure
of the petitioner to sufficiently show that respondent Court of Appeals committed
any reversible error.
SO ORDERED.
Civil Procedure
G.R. No. 130243. October 30, 1998 ROBERTO DELA TORRE, c) what is your annual gross compensation for 1993?
vs. PEPSI COLA PRODUCTS, PHILS., INC. and PEPSICO INC. d) how long have you been employed with your present employer?
3) Are you engaged in any business?
D E C I S I O N MENDOZA, J.: 4) If you are engaged in business,
a) what type of business are you engaged in?
This is a petition for review on certiorari of the decision, dated August 8, 1997,
b) how long have you been engaged in business?
of the Court of Appeals, which affirmed the dismissal by the Regional Trial Court of
c) what is your annual gross income derived from business for 1993?
Makati City of the complaint filed by the petitioners against private respondents
....
Pepsi Cola Products Phils., Inc. (PCPPI) and Pepsico, Inc. (PI) on the ground of refusal
7) Do you own real property?
to make discovery.
8) If you own real property,
The facts of the instant case are as follows: a) how many and what types of real properties do you own?
b) where are these real properties located?
Petitioners are holders of softdrink bottle caps bearing the number 349,
c) what is the present market value of each of these real properties?
allegedly a winning digit in a contest sponsored by respondents PCPPI and PI to
d) what is the latest assessed value of each of these real properties?
promote their beverage products. Respondent PCPPI is a domestic corporation
....
engaged in the production, bottling, and distribution of carbonated drinks, while
56) What type of dwelling do you live in?
private respondent PI, a foreign corporation licensed to do business in the
57) If you live in a house, do you own the house?
Philippines, is the major stockholder of respondent PCPPI.
58) If you are merely renting your dwelling, how much is your monthly
Due to the refusal of respondents PCPPI and PI to deliver the prizes, petitioners rent?
on August 24, 1994 filed eight (8) separate complaints against the former for specific 59) If you are without viable means of income, how are you and your family
performance and damages in the Regional Trial Court of Makati City. Respondent PI being financially supported?[1]
filed answers to the complaints of petitioners, while respondent PCPPI filed motions
On November 25 1994, the Regional Trial Court of Makati issued an order
to dismiss the same on the grounds of failure to state a cause of action and forum
suspending the proceedings until petitioners could complete the documents
shopping. The cases were later consolidated and assigned to Branch 142 of the trial
required for establishing their right to litigate as paupers.
court. Petitioners likewise filed separate motions for authority to litigate in forma
pauperis. It appears that petitioners did not answer the written interrogatories because,
as it turned out, they thought that the order of the court suspended all matters
On November 22 and 23, 1994, respondent PI sent written interrogatories to
connected with the case except those relating to the submission of the papers
petitioners consisting of 59 questions aimed at determining their eligibility to litigate
showing their qualifications to litigate as paupers. Respondent PI filed a motion to
as paupers. Petitioners received the written interrogatories between November 23
dismiss the case on the ground of refusal of petitioners to make
and December 12, 1998. The following are typical of the questions included in the
discovery. Petitioners opposed the motion. In an order, dated March 9, 1995, the
interrogatories:
trial court granted the motion to dismiss stating:
1) Are you employed?
There is nothing in the order which authorized plaintiffs to ignore the interrogatories
2) If you are employed,
served upon them. For that matter, the answers required would reflect as to
a) who is your employer?
whether they are entitled to litigate as paupers, the issue which the court directed
b) what position do you hold in your present employment?
the parties to clarify within thirty (30) days. The sanctions on the party who refuses
Civil Procedure
to make discovery are clear in the rules as well as in the applicable case law. There is
absolutely no reason why plaintiffs should be excused therefrom.[2]
Petitioners filed a motion for reconsideration but the trial court denied their
motion in an order, dated June 16, 1995. They then filed a special civil action
for certiorari in this Court to set aside the aforesaid orders of the trial court. The
case was referred to the Court of Appeals, which on August 8, 1997, affirmed the
orders of the Regional Trial Court.[3] The appellate court held:
Undoubtedly, the petitioners failure to serve their answers within the reglementary
period constitutes a valid ground for the dismissal of their actions or any part
thereof.
While it is true that aside from the dismissal of the actions, there are other sanctions
that may be imposed for failure of a party to serve answers to interrogatories,
however, since respondents are precisely seeking the dismissal of the complaints
because of the petitioners non-compliance with all the requirements that would
entitle them to litigate as paupers, such failure justifies the action taken by the
court a quo, which had previously required the parties to perfect their pleadings.
Needless to state, by not answering the interrogatories, the petitioners rendered it
difficult for respondent Pepsico to substantiate its opposition to their request to
litigate as paupers, as directed by the court a quo.
At any rate, the dismissal ordered by the court a quo is without prejudice, thus
implicitly reserving the petitioners right to further pursue their cases.[4]
Hence, this petition for review on certiorari tendering the following issues:
WHETHER OR NOT THE HONORABLE COURT OF APPEALS COMMITTED GRAVE
ERROR IN NOT CONSIDERING THAT THE REMEDY OF DISMISSAL UPON FAILURE OF A
PARTY TO SERVE ANSWERS TO INTERROGATORIES IS AVAILABLE OR MAY BE
RESORTED TO ONLY WHEN THE SUBJECT MATTER THEREOF REFERS TO THE VERY
MERITS OF THE CASE.
WHETHER OR NOT THE HONORABLE COURT OF APPEALS COMMITTED GRAVE
ERROR IN NOT CONSIDERING THAT THE PETITIONERS HAD SUBSTANTIALLY
COMPLIED WITH THE REQUIREMENTS ON WRITTEN INTERROGATORIES.
We find the instant petition to be well taken, but first we shall dispose of the
procedural objections raised by respondents PCPPI and PI, to wit: (1) that the instant
petition is not accompanied by a sworn certification on non-forum shopping as
required by Rule 45, 4 of the 1997 Rules of Civil Procedure and (2) that the said
petition raises a question of fact which cannot be dealt with in a petition for review
on certiorari under 1 of the said rule.
With respect to the first objection, contrary to the claim of respondents, there is
attached to the petition a sworn certification, dated October 2, 1997, executed by
Jaime Garlitos (one of the petitioners herein), stating that:
3. No other action or proceeding involving the same issues have been commenced
with this Honorable Supreme Court, the regular courts, the Honorable Court of
Appeals, or any other tribunal or agency.
4. To the best of my knowledge, no such action or proceeding is pending before this
Honorable Supreme Court, the regular courts, the Honorable Court of Appeals, or
any other tribunal or agency.
5. If I should thereafter learn that a similar action or proceeding has been filed or is
pending before this Honorable Supreme Court, the regular courts, the Honorable
Court of Appeals, or any other tribunal or agency, I hereby undertake to report that
fact to this Honorable Supreme Court within five (5) days from having gained
knowledge thereof.[5]
This is sufficient compliance with Rule 45, 4 of the 1997 Rules of Civil Procedure.
On the contention that the instant petition raises a question of fact, we hold
that the question raised is a question of law, tested by the standards laid down
in Ramos v. Pepsi-Cola Bottling Co. of the P.I.,[6]recently affirmed in Macawiwili Gold
Mining and Development Co., Inc. v. Court of Appeals: [7]
. . . there is a question of law in a given case when the doubt or difference arises as
to what the law is on a certain set of facts; there is a question of fact when the
doubt or difference arises as to the truth or falsehood of the alleged facts.
For the question in this case is whether petitioners failure to answer written
interrogatories is a sufficient reason for the dismissal of their complaints. The
Civil Procedure
resolution of this question does not depend on the evaluation of proof but on a comply with the modes of discovery rests on sound judicial discretion. As we said
consideration of the applicable legal provisions and case law. in Insular Life Assurance Co., Ltd. v. Court of Appeals:[10]
It is time to move on to the substantive issues in this case. The matter of how, and when, the above sanctions should be applied is one that
primarily rests on the sound discretion of the court where the case pends, having
Under Rule 24, 1 and Rule 25, 1 of the 1964 Rules of Court, a litigant may serve,
always in mind the paramount and overriding interest of justice. For while the
with leave of court and after jurisdiction has been obtained over the defendant or,
modes of discovery are intended to attain the resolution of litigations with great
even without such leave, after an answer has been served, written interrogatories
expediency, they are not contemplated, however, ultimately to be causes of
on the adverse party. Like the other modes of discovery authorized by the Rules of
injustice. It behooves trial courts to examine well the circumstances of each case
Court, the purpose of written interrogatories is to assist the parties in clarifying the
and to make their considered determination thereafter.
issues and in ascertaining the facts involved in a case. As this Court explained
in Republic v. Sandiganbayan:[8]
In the case at bar, we think the trial court was rather precipitate in dismissing
What is chiefly contemplated is the discovery of every bit of information which may the complaints of petitioners against respondents PCPPI and PI.
be useful in the preparation for trial, such as the identity and location of persons
The written interrogatories served by respondent PI on petitioners dealt with
having knowledge of relevant facts; those relevant facts themselves; and the
ancillary matters which, although may be inquired into through the proper modes of
existence, description, nature, custody, condition, and location of any books,
discovery provided in the Rules of Court, are not directly related to the main issues
documents, and other tangible things.
in the suit. As already mentioned, the written interrogatories sent by respondent PI
to petitioners were for the purpose of finding out if the latter were entitled to
To ensure the efficacy of the various modes of discovery, the Rules provide
litigate as paupers, that is, whether they should be exempted from paying docket
sanctions against a party who refuses to make discovery. Rule 29, 5 for example
fees.
states:
Since the payment of docket fees is jurisdictional,[11] respondent PI was certainly
If any party or an officer or managing agent of a party wilfully fails to appear before
entitled to know whether petitioners were eligible to litigate as paupers. The fact
the officer who is to take his deposition, after being served with a proper notice, or
that petitioners later submittedaffidavits, documents, and other supporting papers
fails to serve answers to interrogatories submitted under Rule 25, after proper
on this matter did not justify their failure to answer the written interrogatories since
service of such interrogatories, the court on motion and notice may strike out all or
at the time these were served, respondent PI obviously did not have the information
any part of any pleading of that party, or dismiss the action or proceeding or any
contained in the said documents. However, since after all respondent PI was able to
part thereof, or enter a judgment by default against that party, and in its discretion,
get the information it needed, the dismissal of petitioners complaints appears to be
order him to pay the reasonable expenses incurred by the other, including attorneys
rather a drastic action to take for failure to answer questions dealing with ancillary
fees.
matters and not with the main issues in a case.
This Court has upheld the dismissal of an action due to the refusal of the Furthermore, it appears that petitioners failure to answer the written
plaintiff to make discovery. In Arellano v. Court of First Instance of Sorsogon,[9] it interrogatories was due, not to intransigence, but to a misapprehension of the scope
affirmed the dismissal of a suit for reconveyance of a parcel of land with a claim for of the trial courts order, dated November 25, 1994, suspending the proceedings
damages when the plaintiff unjustifiably failed to answer the written interrogatories until petitioners could complete the documents required for establishing their
sent by the defendant regarding the alleged title of the former. However, the eligibility to litigate as paupers. Petitioners thought that the courts order had the
determination of the sanction a court should impose for the failure of a party to effect of suspending all other matters connected with the case, including the service
Civil Procedure
of answers to the written interrogatories of private respondent PI and for this
reason did not respond to the same. Unlike the plaintiff in Arellano v. Court of First
Instance of Sorsogon,[12] who deliberately disregarded successive orders of the trial
court to explain his refusal to make discovery, there is no showing in the case at bar
that petitioners were guilty of defying or disregarding any court order to answer the
written interrogatories of respondent PI in order to delay the proceedings.
It is of course true that written interrogatories may be sent to adverse parties
and answered by the latter without court intervention. Orders of the court do not
affect ongoing processes of discovery between the parties, unless the same
expressly so provide.
It would be unjust, however, to impose on petitioners such a drastic sanction as
the dismissal of their complaints for a mistake committed in good faith. In Insular
Life Assurance Co., Ltd. v. Court of Appeals,[13] where the plaintiffs did not answer
the written interrogatories sent by the defendant on account of a misconception as
to the scope thereof, we excused plaintiffs failure through a liberal application of
Rule 29, 5 of the 1964 Rules of Court. We believe that the circumstances in the
instant case similarly warrant a benign attitude towards petitioners failure to answer
the written interrogatories.Hence, petitioners should be given a chance to
substantiate in court their claims against private respondents PCPPI and PI.
The trial court should have required petitioners to answer the subject
interrogatories, with a warning of the possible consequences if they did not
comply. The dismissal of their action would be justified only in the event they
bucked such an order.
WHEREFORE, the decision of the Court of Appeals is REVERSED and the case is
REMANDED to the Regional Trial Court of Makati, Branch 142 for trial according to
law.
SO ORDERED.
Melo, (Acting Chairman), Puno, and Martinez, JJ., concur.
Civil Procedure
G.R. No. 147143 March 10, 2006 HYATT INDUSTRIAL MANUFACTURING vs. LEY
CONSTRUCTION
DECISION AUSTRIA-MARTINEZ, J.:
Before the Court is a petition for review on certiorari seeking the nullification of theDecision
dated May 4, 2000 of the Court of Appeals (CA) then Seventh Division in CA-G.R. CV No.
57119, which remanded Civil Case No. 94-1429 to the trial court and directed the latter to
allow the deposition-taking without delay;[1] and the CA Resolution dated February 13, 2001
which denied petitioners motion for reconsideration.[2]
The facts are as follows:
On April 8, 1994, respondent Ley Construction and Development Corporation (LCDC)
filed a complaint for specific performance and damages with the Regional Trial Court
ofMakati, Branch 62 (RTC), docketed as Civil Case No. 94-1429, against petitioner
Hyatt Industrial Manufacturing Corporation (Hyatt) claiming that Hyatt reneged in its
obligation to transfer 40% of the pro indiviso share of a real property in Makati in
favor of LCDC despite LCDCs full payment of the purchase price of P2,634,000.00;
and that Hyatt failed to develop the said property in a joint venture,
despite LCDCs payment of 40% of the pre-construction cost.[3] On April 12, 1994,
LCDC filed an amended complaint impleading Princeton Development Corporation
(Princeton) as additional defendant claiming that Hyatt sold the subject property
to Princeton on March 30, 1994 in fraud of LCDC.[4] On September 21, 1994, LCDC
filed a second amended complaint adding as defendant, Yu He Ching (Yu), President
of Hyatt, alleging that LCDC paid the purchase price of P2,634,000.00 to Hyatt
through Yu.[5]
Responsive pleadings were filed and LCDC filed notices to take the depositions of
Yu; Pacita Tan Go, Account Officer of Rizal Commercial Banking Corporation (RCBC);
and Elena Sy, Finance Officer of Hyatt. Hyatt also filed notice to take deposition of
Manuel Ley, President of LCDC, while Princeton filed notice to take the depositions
of Manuel and Janet Ley.[6]
On July 17, 1996, the RTC ordered the deposition-taking to proceed.[7]
At the scheduled deposition of Elena Sy on September 17, 1996, Hyatt and Yu
prayed that all settings for depositions be disregarded and pre-trial be set instead,
contending that the taking of depositions only delay the resolution of the case. The
RTC agreed and on the same day ordered all depositions cancelled and pre-trial to
take place on November 14, 1996.[8]
LCDC moved for reconsideration[9] which the RTC denied in its October 14,
1996 Order, portion of which reads:
This Court has to deny the motion, because: 1) as already pointed out by this
Court in the questioned Order said depositions will only delay the early
termination of this case; 2) had this Court set this case for pre-trial
conference and trial thereafter, this case would have been terminated by this
time; 3) after all, what the parties would like to elicit from their deponents
would probably be elicited at the pre-trial conference; 4) no substantial
rights of the parties would be prejudiced, if pre-trial conference is held,
instead of deposition.[10]
On November 14, 1996, the scheduled date of the pre-trial, LCDC filed an Urgent
Motion to Suspend Proceedings Due to Pendency of Petition for Certiorari in the
Court of Appeals.[11] The petition, which sought to annul the Orders of the RTC dated
September 17, 1996 and October 14, 1996, was docketed as CA-G.R. SP No.
42512[12] and assigned to the then Twelfth Division of the CA.
Meanwhile, pre-trial proceeded at the RTC as scheduled[13] and with the refusal of
LCDC to enter into pre-trial, Hyatt, Yu and Princeton moved to declare LCDC non-
suited which the RTC granted in its Order dated December 3, 1996, thus:
On September 17, 1996, this Court noticing that this case was filed as early
(as) April 4, 1994[14] and has not reached the pre-trial stage because of
several depositions applied for by the parties, not to mention that the
records of this case has reached two (2) volumes, to avoid delay, upon
motion, ordered the cancellation of the depositions.
On September 24, 1996, plaintiff filed a motion for reconsideration,
seeking to reconsider and set aside the order dated September 17,
1996, which motion for reconsideration was denied in an order dated
October 14, 1996, ruling among others that after all, what the parties
would like to elicit from these deponents would probably be elicited
at the pre-trial conference, and, reiterated the order setting this case
for pre-trial conference on November 14, 1996.
Civil Procedure
On the scheduled pre-trial conference on November 14, 1996, a
petition for certiorari was filed with the Court of Appeals, seeking to
annul the Order of this Court dated September 17, 1996and October
14, 1996, furnishing this Court with a copy on the same date.
At the scheduled pre-trial conference on November 14, 1996, plaintiff
orally moved the Court to suspend pre-trial conference
alleging pendency of a petition with the Court of Appeals and made it
plain that it cannot proceed with the pre-trial because the issue on
whether or not plaintiff may apply for depositions before the pre-trial
conference is a prejudicial question. Defendants objected, alleging
that even if the petition is granted, pre-trial should proceed and that
plaintiff could take deposition after the pre-trial conference, insisting
that defendants are ready to enter into a pre-trial conference.
This Court denied plaintiffs motion to suspend proceedings and
ordered plaintiff to enter into pre-trial conference. Plaintiff
refused. Before this Court denied plaintiffs motion to suspend, this
Court gave Plaintiff two (2) options: enter into a pre-trial conference,
advising plaintiff that what it would like to obtain at the deposition
may be obtained at the pre-trial conference, thus expediting early
termination of this case; and, terminate the pre-trial conference and
apply for deposition later on. Plaintiff insisted on suspension of the
pre-trial conference alleging that it is not ready to enter into pre-trial
conference in view of the petition for certiorari with the Court of
Appeals. Defendants insisted that pre-trial conference proceed as
scheduled, manifesting their readiness to enter into a pre-trial
conference.
When plaintiff made it clear that it is not entering into the pre-trial
conference, defendants prayed that plaintiff be declared non-
suited. x x x
In the light of the foregoing circumstances, this Court is compelled to
dismiss plaintiffs complaint.
WHEREFORE, for failure of plaintiff to enter into pre-trial conference
without any valid reason, plaintiffs complaint is
dismissed. Defendants counterclaims are likewise dismissed.
SO ORDERED.[15]
LCDC filed a motion for reconsideration[16] which was denied however by the trial
court in its Order dated April 21, 1997.[17] LCDC went to the CA on appeal which was
docketed as CA-G.R. CV No. 57119 and assigned to the then Seventh Division of the
CA.[18]
On July 24, 1997, the CAs then Twelfth Division,[19] in CA-G.R. SP No. 42512
denied LCDCs petition for certiorari declaring that the granting of the petition and
setting aside of the September 17, 1996 and October 14, 1996 Orders are manifestly
pointless considering that the complaint itself had already been dismissed and
subject of the appeal docketed as CA-G.R. CV No. 57119; that the reversal of the said
Orders would have practical effect only if the dismissal were also set aside and the
complaint reinstated; and that the dismissal of the complaint rendered the petition
for certiorari devoid of any practical value.[20] LCDCs motion for reconsideration of
the CA-G.R. SP No. 42512 decision was denied on March 4, 1998.[21] LCDC then filed
with this Court, a petition for certiorari, docketed as G.R. No. 133145 which this
Court dismissed on August 29, 2000.[22]
On May 4, 2000, the CAs then Seventh Division issued in CA-G.R. CV No. 57119 the
herein assailed decision, the fallo of which reads:
WHEREFORE, premises considered, finding the appeal meritorious,
this case is remanded to the court a quo for further hearing and
directing the latter to allow the deposition taking without delay.
SO ORDERED.[23]
The CA reasoned that: LCDC complied with Section 1, Rule 23 of the 1997 Rules of
Civil Procedure which expressly sanctions depositions as a mode of discovery
without leave of court after the answer has been served; to unduly restrict the
modes of discovery during trial would defeat the very purpose for which it is
Civil Procedure
intended which is a pre-trial device, and at the time of the trial, the issues would
already be confined to matters defined during pre-trial; the alleged intention of
expediting the resolution of the case is not sufficient justification to recall the order
to take deposition as records show that the delay was brought about by
postponement interposed by both parties and other legal antecedents that are in no
way imputable to LCDC alone; deposition-taking, together with the other modes of
discovery are devised by the rules as a means to attain the objective of having all the
facts presented to the court; the trial court also erred in dismissing the complaint as
LCDC appeared during the pre-trial conference and notified it of the filing of a
petition before the CA; such is a legitimate justification to stall the pre-trial
conference, as the filing of the petition was made in good faith in their belief that
the court a quo erred in canceling the deposition scheduled for no apparent
purpose.[24]
Hyatt and Princeton filed their respective motions for reconsideration which
the CA denied on February 13, 2001.[25]
Hyatt and Yu now come before the Court via a petition for review
on certiorari, on the following grounds:
I THE COURT OF APPEALS, SEVENTH DIVISION,
COMMITTED GRAVE ABUSE OF DISCRETION, ACTUALLY
AMOUNTING TO LACK OF JURISDICTION, IN HOLDING IN
EFFECT INVALID THE ORDERS OF THE LOWER COURT DATED
SEPTEMBER 17, 1996 AND OCTOBER 14, 1996 WHICH ARE
NOT RAISED OR PENDING BEFORE IT, BUT IN ANOTHER CASE
(CA-G.R. SP. No. 42512) PENDING BEFORE ANOTHER DIVISION
OF THE COURT OF APPEALS, TWELFTH DIVISION, AND WHICH
CASE WAS DISMISSED BY THE SAID DIVISION OF THE COURT
OF APPEALS AND FINALLY BY THE HONORABLE SUPREME
COURT IN G.R. NO. 133145.
II THE COURT OF APPEALS, SEVENTH DIVISION,
COMMITTED GRAVE ABUSE OF DISCRETION AND
SERIOUS ERRORS OF LAW IN REVERSING THE LOWER
COURTS ORDER DATED DECEMBER 3, 1996 AND APRIL 21,
1997 HOLDING RESPONDENT NON-SUITED FOR FAILURE
TO ENTER INTO PRE-TRIAL.[26]
Anent the first issue, petitioners claim that: the validity of the RTC Order dated
September 17, 1996 which set the case for pre-trial, as well as its Order dated
October 14, 1996 denying LCDCs motion for partial reconsideration are not involved
in CA-G.R. CV No. 57119 but were the subject of CA-G.R. SP No. 42512, assigned to
the then Twelfth Division, which dismissed the same on July 24, 1997 and which
dismissal was affirmed by this Court in G.R. No. 133145; in passing upon the validity
of the Orders dated September 17, 1996 and October 14, 1996, the CAs then
Seventh Division in CA-G.R. CV No. 57119 exceeded its authority and encroached on
issues taken cognizance of by another Division.[27]
On the second issue, petitioners claim that: the CAs then Seventh Division should
have outrightly dismissed the appeal of LCDC as the same did not involve any error
of fact or law but pertains to a matter of discretion which is properly a subject
of certiorari under Rule 65 of the Revised Rules of Court; conducting discovery thru
deposition is not a condition sine qua non to the holding of a pre-trial and the fact
that LCDC wanted to take the deposition of certain persons is not a valid ground to
suspend the holding of pre-trial and subsequently the trial on the merits; the
persons whose depositions were to be taken were listed as witnesses during the
trial; to take their depositions before the lower court and to present them as
witnesses during the trial on the merits would result in unnecessary duplicity; the
fact that LCDC has a pending petition for certiorari with the CAs then Twelfth
Division docketed as CA-G.R. SP No. 42512 is not a ground to cancel or suspend the
scheduled pre-trial on November 14, 1996 as there was no restraining order
issued; LCDCs availment of the discovery procedure is causing the undue delay of
the case; it is only after LCDC has filed its complaint that it started looking for
evidence to support its allegations thru modes of discovery and more than two years
has already passed after the filing of the complaint yet LCDC still has no
documentary evidence to present before the lower court to prove its allegations in
the complaint.[28]
Petitioners then pray that the Decision dated May 4, 2000 and the Resolution dated
February 13, 2001 of the CAs then Seventh Division in CA-G.R. CV No. 57119 be
annulled and set aside and the validity of the Orders dated December 3, 1996 and
Civil Procedure
April 21, 1997 of the RTC of Makati, Branch 62 in Civil Case No. 94-1429 be
sustained.[29]
In its Comment, LCDC argues that the petitioners erred in claiming that the CAs then
Seventh Division overstepped its authority as this Court has ruled in G.R. No. 133145
that the issue of whether LCDC has been denied its right to discovery is more
appropriately addressed in the appeal before the then Seventh Division in CA-G.R.
CV No. 57119 below rather than by the then Twelfth Division in
the certiorari proceeding in CA-G.R. SP No. 42512; and while the appeal of the final
Order of the RTC dated December 3, 1996 also questioned the Orders dated
September 17, 1996 and October 14, 1996, it does not render the appeal improper
as this Court in G.R. No. 133145 held that the subsequent appeal constitutes an
appropriate remedy because it assails not only the Order dated December 3, 1996,
but also the two earlier orders.[30]
On the second issue, LCDC contends that: the mere fact that a deponent will
be called to the witness stand during trial is not a ground to deny LCDC the right to
discovery and does not cause unnecessary duplicity, otherwise no deposition can
ever be taken; a deposition is for the purpose of discovering evidence while trial is
for the purpose of presenting evidence to the court; if petitioners concern was the
delay in the disposition of the case, the remedy is to expedite the taking of the
depositions, not terminate them altogether; petitioners have nothing to fear from
discovery unless they have in their possession damaging evidence; the parties
should be allowed to utilize the discovery process prior to conducting pre-trial since
every bit of relevant information unearthed through the discovery process will
hasten settlement, simplify the issues and determine the necessity of amending the
pleadings; the trial court erred in not suspending the pre-trial conference pending
the petition for certiorari before the then Twelfth Division of the CA since
considerations of orderly administration of justice demanded that the trial court
accord due deference to the CA; not only was LCDCs petition for certiorari filed in
good faith, the CA found it meritorious, vindicating LCDCs insistence that the pre-
trial be suspended; the undue delay in the disposition of the case was not
attributable to LCDCsdeposition-taking but to the flurry of pleadings filed by
defendants below to block LCDCs depositions and prevent it from gaining access to
critical evidence; the critical evidence that LCDC needs to obtain through discovery is
evidence that is totally within the knowledge and possession of petitioners and
defendant Princeton and is not available elsewhere.[31]
On September 17, 2001, the Court required the parties to file their respective
memoranda.[32] Hyatt and Yu on the one hand and LCDC on the other filed their
respective memoranda reiterating their positions.[33]
On January 2, 2002, Princeton filed a Comment which this Court considered as its
Memorandum in the Resolution dated January 30, 2002.[34]
In said memorandum, Princeton averred that: it is not true that Princeton failed to
comply with any discovery orders as all information requested of Princeton was duly
furnished LCDC and there are no pending discovery orders insofar as Princeton is
concerned; LCDC is seeking to dictate its procedural strategies on the RTC and the
opposing parties; LCDC was not deprived due process as it was given all the
opportunity to prepare for its case and to face its opponents before the court; LCDC
admits to the probability of forum shopping as it filed a petition for certiorari with
the then Twelfth Division of the CA and later an appeal with the then Seventh
Division of the CA; the RTC did not bar LCDC from presenting witnesses or
discovering any evidence, as all it did was to transfer the venue of the testimony and
discovery to the courtroom and get on with the case which LCDC did not want to do;
that discovery proceedings need not take place before pre-trial conference; trial
court judges are given discretion over the right of parties in the taking of depositions
and may deny the same for good reasons in order to prevent abuse; the trial court
did not err in not granting LCDCs motion to suspend proceedings due to
the pendency of a petition for certiorari with the CA since there was no order from
said court and there was no merit in the petition for certiorari as shown by the
dismissal thereof by the then Twelfth Division; there was proper and legal ground
for the trial court to declare LCDC non-suited; appearance at the pre-trial is not
enough; there is no evidence to support LCDCs claim that Hyatt surreptitiously
transferred title to Princeton.[35]
The Court is in a quandary why Hyatt and Yu included Princeton as respondent in the
present petition when Princeton was their co-defendant below and the arguments
they raised herein pertain only to LCDC. With the failure of petitioners to raise any
ground against Princeton in any of its pleadings before this Court, we shall
treat Princetons inclusion as respondent in the present petition as mere
inadvertence on the part of petitioners.
Civil Procedure
Now to the merits. The issues that need to be resolved in this case may be simplified
as follows: (1) Whether the CAs then Seventh Division exceeded its authority in
ruling upon the validity of the Orders dated September 17, 1996 and November 14,
1996; and (2) Whether the CA erred in remanding the case to the trial court and
order the deposition-taking to proceed.
We answer both questions in the negative.
Petitioners assert that the CAs then Twelfth Division in CA-GR SP No. 42512 and this
Court in G.R. No. 133145 already ruled upon the validity of the Orders
dated September 17, 1996 and November 14, 1996, thus the CAs then Seventh
Division in CA G.R. CV No. 57119 erred in ruling upon the same.
A cursory reading of the decisions in CA-GR SP No. 42512 and G.R. No.
133145, however, reveals otherwise. The CAs then Twelfth Division in CA-G.R. SP No.
42512 was explicit in stating thus:
x x x Any decision of ours will not produce any practical legal
effect. According to the petitioner, if we annul the questioned Orders,
the dismissal of its Complaint by the trial [court] will have to be set
aside in its pending appeal. That assumes that the division handling
the appeal will agree with Our decision. On the other hand, it may
not. Also other issues may be involved therein than the validity of the
herein questioned orders.
We cannot pre-empt the decision that might be rendered in such
appeal. The division to [which] it has been assigned should be left free
to resolve the same. On the other hand, it is better that this Court
speak with one voice.[36]
This Court in G.R. No. 133145 also clearly stated that:
x x x First, it should be stressed that the said Petition (CA-G.R.
SP No. 42512) sought to set aside only the two interlocutory RTC
Orders, not the December 3, 1996 Resolution dismissing the
Complaint. Verily, the Petition could not have assailed the Resolution,
which was issued after the filing of the former.
Under the circumstances, granting the Petition
for Certiorari and setting aside the two Orders are manifestly
pointless, considering that the Complaint itself had already been
dismissed.Indeed, the reversal of the assailed Orders would have
practical effect only if the dismissal were also set aside and the
Complaint reinstated. In other words, the dismissal of the Complaint
rendered the Petition for Certiorari devoid of any practical value.
Second, the Petition for Certiorari was superseded by the
filing, before the Court of Appeals, of a subsequent appeal docketed
as CA-G.R. CV No. 57119, questioning the Resolution and the two
Orders. In this light, there was no more reason for the CA to resolve
the Petition for Certiorari.
In this case, the subsequent appeal constitutes an adequate
remedy. In fact, it is the appropriate remedy, because it assails not
only the Resolution but also the two Orders.
WHEREFORE, the Petition is DENIED and the assailed
Resolutions AFFIRMED. x x x.[37]
With the pronouncements of the CA in CA-G.R. SP No. 42512 and by this Court in
G.R. No. 133145 that the subsequent appeal via CA-G.R. CV No. 57119 constitutes as
the adequate remedy to resolve the validity of the RTC Orders dated September 17,
1996 and November 14, 1996, the arguments of petitioners on this point clearly
have no leg to stand on and must therefore fail.
On the second issue, the Court finds that the CA was correct in remanding the case
to the RTC and ordering the deposition-taking to proceed.
A deposition should be allowed, absent any showing that taking it would
prejudice any party.[38] It is accorded a broad and liberal treatment and the liberty of
a party to make discovery is well-nigh unrestricted if the matters inquired into are
otherwise relevant and not privileged, and the inquiry is made in good faith and
within the bounds of law.[39] It is allowed as a departure from the accepted and usual
judicial proceedings of examining witnesses in open court where their demeanor
could be observed by the trial judge, consistent with the principle of promoting just,
speedy and inexpensive disposition of every action and proceeding;[40] and provided
Civil Procedure
it is taken in accordance with the provisions of the Rules of Court, i.e., with leave of
court if summons have been served, and without such leave if an answer has been
submitted; and provided further that a circumstance for its admissibility
exists (Section 4, Rule 23, Rules of Court).[41] The rules on discovery should not be
unduly restricted, otherwise, the advantage of a liberal discovery procedure in
ascertaining the truth and expediting the disposal of litigation would be defeated. [42]
Indeed, the importance of discovery procedures is well recognized by the
Court. It approved A.M. No. 03-1-09-SC on July 13, 2004 which provided for the
guidelines to be observed by trial court judges and clerks of court in the conduct of
pre-trial and use of deposition-discovery measures. Under A.M. No. 03-1-09-SC, trial
courts are directed to issue orders requiring parties to avail of interrogatories to
parties under Rule 45 and request for admission of adverse party under Rule 26 or at
their discretion make use of depositions under Rule 23 or other measures under
Rule 27 and 28 within 5 days from the filing of the answer. The parties are likewise
required to submit, at least 3 days before the pre-trial, pre-trial briefs, containing
among others a manifestation of the parties of their having availed or their intention
to avail themselves of discovery procedures or referral to commissioners.[43]
Since the pertinent incidents of the case took place prior to the effectivity of
said issuance, however, the depositions sought by LCDC shall be evaluated based on
the jurisprudence and rules then prevailing, particularly Sec. 1, Rule 23 of the 1997
Rules of Court which provides as follows:
SECTION 1. Depositions pending action, when may be taken.---
By leave of court after jurisdiction has been obtained over any
defendant or over property which is the subject of the action, or
without such leave after an answer has been served, the testimony
of any person, whether a party or not, may be taken, at the instance
of any party, by deposition upon oral examination or written
interrogatories. The attendance of witnesses may be compelled by
the use of a subpoena as provided in Rule 21. Depositions shall be
taken only in accordance with these Rules. The deposition of a person
confined in prison may be taken only by leave of court on such terms
as the court prescribes. (Emphasis supplied).
As correctly observed by the CA, LCDC complied with the above quoted
provision as it made its notice to take depositions after the answers of the
defendants have been served. LCDC having complied with the rules then prevailing,
the trial court erred in canceling the previously scheduled depositions.
While it is true that depositions may be disallowed by trial courts if the
examination is conducted in bad faith; or in such a manner as to annoy, embarrass,
or oppress the person who is the subject of the inquiry, or when the inquiry touches
upon the irrelevant or encroaches upon the recognized domains of privilege, [44] such
circumstances, however are absent in the case at bar.
The RTC cites the delay in the case as reason for canceling the scheduled
depositions. While speedy disposition of cases is important, such consideration
however should not outweigh a thorough and comprehensive evaluation of cases,
for the ends of justice are reached not only through the speedy disposal of cases but
more importantly, through a meticulous and comprehensive evaluation of the
merits of the case.[45] Records also show that the delay of the case is not attributable
to the depositions sought by LCDC but was caused by the many pleadings filed by all
the parties including petitioners herein.
The argument that the taking of depositions would cause unnecessary
duplicity as the intended deponents shall also be called as witnesses during trial, is
also without merit.
The case of Fortune Corp. v. Court of Appeals[46] which already settled the
matter, explained that:
The availability of the proposed deponent to testify in court
does not constitute good cause to justify the courts order that his
deposition shall not be taken. That the witness is unable to attend or
testify is one of the grounds when the deposition of a witness may be
used in court during the trial. But the same reason cannot be
successfully invoked to prohibit the taking of his deposition.
The right to take statements and the right to use them in court
have been kept entirely distinct. The utmost freedom is allowed in
Civil Procedure
taking depositions; restrictions are imposed upon their use. As a
result, there is accorded the widest possible opportunity for
knowledge by both parties of all the facts before the trial. Such of this
testimony as may be appropriate for use as a substitute for viva
voce examination may be introduced at the trial; the remainder of the
testimony, having served its purpose in revealing the facts to the
parties before trial, drops out of the judicial picture.
x x x [U]nder the concept adopted by the new Rules, the
deposition serves the double function of a method of discovery - with
use on trial not necessarily contemplated - and a method of
presenting testimony. Accordingly, no limitations other than
relevancy and privilege have been placed on the taking of
depositions, while the use at the trial is subject to circumscriptions
looking toward the use of oral testimony wherever practicable.[47]
Petitioner also argues that LCDC has no evidence to support its claims and
that it was only after the filing of its Complaint that it started looking for evidence
through the modes of discovery.
On this point, it is well to reiterate the Courts pronouncement in Republic v.
Sandiganbayan[48]:
What is chiefly contemplated is the discovery of every bit of
information which may be useful in the preparation for trial, such as
the identity and location of persons having knowledge of relevant
facts; those relevant facts themselves; and the existence, description,
nature, custody, condition, and location of any books, documents, or
other tangible things. Hence, the deposition-discovery rules are to be
accorded a broad and liberal treatment. No longer can the time-
honored cry of fishing expedition serve to preclude a party from
inquiring into the facts underlying his opponents case. Mutual
knowledge of all the relevant facts gathered by both parties is
essential to proper litigation. To that end, either party may compel
the other to disgorge whatever facts he has in his possession. The
deposition-discovery procedure simply advances the stage at which
the disclosure can be compelled from the time of trial to the period
preceding it, thus reducing the possibility, of surprise.[49]
It also does not escape this Courts attention that the trial court, before
dismissing LCDCs complaint, gave LCDC two options: (a) enter into a pre-trial
conference, advising LCDC that what it would like to obtain at the deposition may be
obtained at the pre-trial conference, thus expediting early termination of the case;
and (b) terminate the pre-trial conference and apply for deposition later on. The trial
court erred in forcing LCDC to choose only from these options and in dismissing its
complaint upon LCDCs refusal to choose either of the two.
The information LCDC seeks to obtain through the depositions of Elena Sy,
the Finance Officer of Hyatt and Pacita Tan Go, an Account Officer of RCBC, may not
be obtained at the pre-trial conference, as the said deponents are not parties to the
pre-trial conference.
As also pointed out by the CA:
x x x To unduly restrict the modes of discovery during trial,
would defeat the very purpose for which it is intended, as a pre-trial
device. By then, the issues would have been confined only on matters
defined during pre-trial. The importance of the modes of discovery
cannot be gainsaid in this case in view of the nature of the
controversy involved and the conflicting interest claimed by the
parties.[50]
Deposition is chiefly a mode of discovery, the primary function of which is to
supplement the pleadings for the purpose of disclosing the real matters of dispute
between the parties and affording an adequate factual basis during the preparation
for trial.[51]
Further, in Republic v. Sandiganbayan[52] the Court explained that:
The truth is that evidentiary matters may be inquired into and
learned by the parties before the trial. Indeed, it is the purpose and
Civil Procedure
policy of the law that the parties - before the trial if not indeed even game of blind mans bluff and more a fair contest with the basic issues and facts
before the pre-trial - should discover or inform themselves of all the disclosed to the fullest practicable extent. [54]
facts relevant to the action, not only those known to them
individually, but also those known to their adversaries; in other Considering the foregoing, the Court finds that the CA was correct in
words, the desideratum is that civil trials should not be carried on in remanding the case to the trial court and ordering the depositions to proceed.
the dark; and the Rules of Court make this ideal possible through the
deposition- discovery mechanism set forth in Rules 24 to 29. The WHEREFORE, the petition is denied for lack of merit.
experience in other jurisdictions has been the ample discovery before
trial, under proper regulation, accomplished one of the most Costs against petitioner.
necessary ends of modern procedure; it not only eliminates
unessential issues from trials thereby shortening them considerably, SO ORDERED.
but also requires parties to play the game with the cards on the table
so that the possibility of fair settlement before trial is measurably
increased.
MA. ALICIA AUSTRIA-MARTINEZ
As just intimated, the deposition-discovery procedure was
designed to remedy the conceded inadequacy and cumbersomeness Associate Justice
of the pre-trial functions of notice-giving, issue-formulation and fact
revelation theretofore performed primarily by the pleadings.

The various modes or instruments of discovery are meant to

serve (1) as a device, along with the pre-trial hearing under Rule 20,
to narrow and clarify the basic issues between the parties, and (2) as
a device for ascertaining the facts relative to those issues. The evident
purpose is, to repeat, to enable the parties, consistent with
recognized privileges, to obtain the fullest possible knowledge of the
issues and facts before civil trials and thus prevent that said trials are
carried on in the dark.[53] (emphasis supplied)

In this case, the information sought to be obtained through the depositions

of Elena and Pacita are necessary to fully equip LCDC in determining what issues will
be defined at the pre-trial. Without such information before pre-trial, LCDC will be
forced to prosecute its case in the dark --- the very situation which the rules of
discovery seek to prevent. Indeed, the rules on discovery seek to make trial less a
Civil Procedure
G.R. No. 133154 December 9, 2005 JOWELL SALES vs. CYRIL A. SABINO
DECISION GARCIA, J.:
Assailed and sought to be set aside in this petition for review on certiorari under
Rule 45 of the Rules of Court are the following issuances of the Court of Appeals (CA)
in CA-G.R. SP No. 44078, to wit:
1. Decision[1] dated January 20, 1998, affirming an earlier order of
the Regional Trial Court, Branch 152, National Capital Judicial
Region, which admitted the deposition of one Buaneres Corral
as part of respondents evidence in an action for damages; and
2. Resolution[2] dated March 22, 1998, denying petitioners motion
for reconsideration.
Briefly, the facts may be stated as follows:
On February 20, 1995, in the Regional Trial Court (RTC) at Pasig City, Metro Manila,
herein respondent Cyril A. Sabino filed an amended complaint [3] for damages
against, among others, herein petitioner Jowel Sales, driver of the vehicle involved in
the accident which ultimately caused the death of respondents son, Elbert.
Before any responsive pleading could be filed, respondent, as plaintiff a quo,
notified the defendants that he will take the deposition of one Buaneres Corral
before the Clerk of Court, RTC- Pasig City.
On December 27, 1995 and resumed on January 3, 1996, the deposition on oral
examination of Buaneres Corral was taken before the Clerk of Court of Pasig, in the
presence and with the active participation of petitioners counsel, Atty. Roldan
Villacorta, who even lengthily cross-examined the deponent. In the course of trial,
respondent had the deposition of Buaneres Corral marked as her Exhibits DD[4] and
EE[5], with submarkings.
Upon conclusion of her evidentiary presentation, respondent made a Formal
Offer of Exhibits,[6] among which are Exhibits DD and EE. Likewise offered in
evidence as Exhibit BB[7] is a certification from the Bureau of Immigration attesting
to the May 28, 1996 departure for abroad of Buaneres Corral via Flight No. PR 658.
Petitioner opposed the admission of Exhs. DD and EE and even asked that
they be expunged from the records on the ground that the jurisdictional
requirements for their admission under Section 4, Rule 23 of the Rules of
Court, infra, were not complied with. He also downplayed the evidentiary value of
Exhibit BB for reasons he would repeat in this petition.
In its order of February 3, 1997,[8] the trial court admitted, among other
evidence, respondents Exhibits DD, EE and BB. With his motion for
reconsideration[9] having been denied by the court in its subsequent order of March
25, 1997,[10] petitioner went on certiorari to the Court of Appeals in CA-G.R. SP No.
44078, imputing grave abuse of discretion on the part of the trial court in admitting
in evidence the deposition in question (Exhibits DD and EE).
As stated at the threshold hereof, the appellate court, in the herein assailed
decision dated January 20, 1998,[11] upheld the trial court and effectively denied due
course to and dismissed petitioners recourse, explaining, inter alia, that petitioners
active participation, through counsel, during the taking of subject deposition and
adopting it as his own exhibits, has thereby estopped him from assailing the
admissibility thereof as part of respondents evidence. His motion for reconsideration
having been denied by the appellate court in its equally assailed resolution of March
22, 1998, petitioner is now with us via the instant petition, raising the following
issues of his own formulation:
1. Whether or not the requirements of Section 4, Rule 24 (now
Section 3) of the Revised Rules of Court were satisfied by the
respondent when it presented a certification attesting to the fact that
deponent has left the country but silent as to whether or not at the
time his deposition was offered in evidence is in the Philippines
2. Whether or not the petitioner in cross-examining the
deponent during the taking of his deposition waived any and all
objections in connection therewith.[12]
The petition lacks merit.
Section 4, Rule 23[13] of the Rules of Court, upon which petitioner mounts his
challenge to the admission in evidence of the subject deposition, pertinently reads:
Civil Procedure
SEC. 4. Use of depositions.- At the trial . . . any part or all of a
deposition, so far as admissible under the rules of evidence, may be
used against any party who was present or represented at the taking
of the deposition or who had due notice thereof, in accordance with
any of the following provisions:
xxx xxx xxx
(c) The deposition of a witness, whether or not a party, may
be used by any party for any purpose if the court finds: (1) that the
witness is dead; or (2) that the witness resides at a distance more
than one hundred (100) kilometers from the place of trial or
hearing, or is out of the Philippines, unless it appears that his
absence was procured by the party offering the deposition; or (3)
that the witness is unable to attend or testify because of age,
sickness, infirmity, or imprisonment; or (4) that the party offering
the deposition has been unable to procure the attendance of the
witness by subpoena; or (5) upon application and notice, that such
exception circumstances exist and with due regard to the
importance of presenting the testimony of witnesses orally in open
court, to allow the deposition to be used. (Emphasis supplied).
It is petitioners posture that none of the above conditions exists in this case
to justify the admission in evidence of respondents Exhibits DD and EE. Hence, it was
error for the appellate court to have upheld the admission thereof by the trial court.
Discounting the probative value of the certification from the Bureau of Immigration
(Exh. BB) that deponent Buaneres Corral departed for abroad on May 28, 1996,
petitioner argues that said certification merely proves the fact of Corral having left
the country on the date therein mentioned. It does not, however, establish that he
has not returned since then and is unavailable to be present in court to personally
testify.
While depositions may be used as evidence in court proceedings, they are
generally not meant to be a substitute for the actual testimony in open court of a
party or witness. Stated a bit differently, a deposition is not to be used when the
deponent is at hand.[14] Indeed, any deposition offered during a trial to prove the
facts therein set out, in lieu of the actual oral testimony of the deponent in open
court, may be opposed and excluded on the ground of hearsay. However,
depositions may be used without the deponent being called to the witness stand by
the proponent, provided the existence of certain conditions is first satisfactorily
established. Five (5) exceptions for the admissibility of a deposition are listed in
Section 4, Rule 23, supra, of the Rules of Court. Among these is when the witness is
out of the Philippines.
The trial court had determined that deponent Bueneres Corral was abroad
when the offer of his deposition was made. This factual finding of absence or
unavailability of witness to testify deserves respect, having been adequately
substantiated. As it were, the certification by the Bureau of Immigration Exh. BB-
provides that evidentiary support. Accordingly, the attribution of grave abuse of
discretion on the part of the trial court must be struck down. It has been said to be
customary for courts to accept statements of parties as to the unavailability of a
witness as a predicate to the use of depositions.[15] Had deponent Buaneres Corral
indeed returned to the Philippines subsequent to his departure via Flight No. PR
658, petitioner could have presented evidence to show that such was the case. As it
is, however, the petitioner does not even assert the return as a fact, only offering it
as a possibility since no contrary proof had been adduced.
Given the foregoing perspective, the second issue of whether or not
petitioner is estopped from objecting to the use of Corrals deposition as part of
respondents evidence is really no longer determinative of the outcome of this case,
and need not detain us long. Suffice it to state that, as a rule, the inadmissibility of
testimony taken by deposition is anchored on the ground that such testimony is
hearsay, i.e., the party against whom it is offered has no opportunity to cross-
examine the deponent at the time his testimony is offered. But as jurisprudence
teaches, it matters not that opportunity for cross-examination was afforded during
the taking of the deposition; for normally, the opportunity for cross-examination
must be accorded a party at the time the testimonial evidence is actually presented
against him during the trial or hearing.[16] In fine, the act of cross-examining the
deponent during the taking of the deposition cannot, without more, be considered a
waiver of the right to object to its admissibility as evidence in the trial proper. In
participating, therefore, in the taking of the deposition, but objecting to its
admissibility in court as evidence, petitioner did not assume inconsistent positions.
He is not, thus, estopped from challenging the admissibility of the deposition just
because he participated in the taking thereof.
Civil Procedure
Lest it be overlooked, Section 29, Rule 23 of the Rules of Court, no less, lends
support to the conclusion just made. In gist, it provides that, while errors and
irregularities in depositions as to notice, qualifications of the officer conducting the
deposition, and manner of taking the deposition are deemed waived if not objected
to before or during the taking of the deposition, objections to the competency of a
witness or the competency, relevancy, or materiality of testimony may be made for
the first time at the trial and need not be made at the time of the taking of the
deposition, unless they could be obviated at that point.[17]

While perhaps a bit anti-climactic to state at this point, certiorari will not lie
against an order admitting or rejecting a deposition in evidence, the remedy being
an appeal from the final judgment.[18] For this singular reason alone, the appellate
court could have had already dismissed herein petitioners invocation of
its certiorari jurisdiction.

WHEREFORE, the instant petition is hereby DENIED.

Costs against petitioner.

SO ORDERED.

CANCIO C. GARCIA
Associate Justice
Civil Procedure
G.R. No. 193158 November 11, 2015 PHILIPPINE HEALTH INSURANCE
CORPORATION vs. OUR LADY OF LOURDES HOSPITAL
DECISION PERALTA, J.:
This petition for review on certiorari under Rule 45 of the Rules of
Court (Rules) seeks to reverse the July 27, 2010 Decision1 of the Court of
Appeals (CA) in CA-G.R. SP No. 110444, which annulled and set aside the August 11,
2009 Resolution2 and September 4, 2009 Order3 of the petitioner's Arbitration
Department denying respondent's resort to modes of discovery.
Petitioner Philippine Health Insurance Corporation (PHIC) is a government
corporation created under Republic Act (R.A.) No. 7875,4 as amended,5 to administer
and implement the country's National Health Insurance Program, while respondent
Our Lady of Lourdes Hospital ( OLLH) is an institutional health care provider duly
accredited with the PHIC.
On May 14, 2009, PHIC filed a Complaint6 with its Legal Sector - Prosecution
Department against OLLH for the administrative offense of filing multiple claims,
which is penalized under Section 145, Rule XXVIII of the Implementing Rules and
Regulations (!RR) of R.A. No. 7875. Allegedly, OLLH filed two claims of the same
amount of PhilHealth benefits involving the same patient for the same diagnosis and
covering the same period of confinement.
The case, which was docketed as HCP-NCR-09-082, was assigned to Senior Arbiter
Atty. Darwin G. De Leon (De Leon) and Summons was duly served upon OLLH.7 On
June 23, 2009, OLLH filed a Verified Answer.8
After which, the parties were directed to file their respective Position Papers. 9 PHIC
complied with the order.10
On its part, OLLH moved to defer the submission of its position paper pending the
answer of the PHIC President and CEO to the written interrogatories as well as the
inspection and copying of the original transmittal letter and all other claims that
accompanied Annex B11 of the Complaint.12 According to OLLH, these modes of
discovery were availed of because its representatives were denied and/or not given
access to documents and were not allowed to talk to PHIC personnel with regard to
the charge.13
PHIC filed its Comment14 on OLLH's motion. Thereafter, the PHIC Arbitration
Department, through Arbiter De Leon, denied OLLH' s motion. The August 11, 2009
Resolution opined:
In the light of being summary in nature of the rules that govern the administrative
proceedings as in this case, the interrogatories and motion for production and
inspection of documents filed by [OLLH] [cannot] be given due course by this Office.
Relevantly, for an obvious reason as can be inferred from the purpose of the said
pleadings, the allowance of the same would not practically hasten the early
disposition of the instant case, instead undermine the objective of the above-cited
provisions [Sections 91 and 92 of the 2004 IRR of R.A. No. 7875, as amended by R.A.
No. 9241] which clearly and explicitly demand or call for an immediate resolution of
the subject case. The bare and unsubstantiated allegations of [OLLH] that its
representatives were denied access to the documents pertaining to the PhilHealth
claim subject of this controversy and.at the same time were not allowed to talk to
any of the PhilHealth personnel which prompted the respondent to resort to the
modes of discovery herein above-mentioned, deserve scant consideration for being
self-serving. [On] the contrary, this Office perceives the [OLLH's] filing of the
aforesaid pleadings [was] designed for no other conceivable end or purpose but to
delay the proceedings.15
The Motion for Reconsideration16 filed by OLLH suffered the same fate as the
September 4, 2009 Order held:
Evidently, the main argument of [OLLH] as can be perused in its Motion is predicated
on the Supreme Court ruling, specifically in Koh v. Intermediate Appellate Court, 144
SCRA 259 [1986], which recognizes the importance of rules on discovery in
expediting the trial of the case. However, in the same cited case, it was also declared
that "the recourse to discovery procedure is not mandatory. If the parties do not
choose to resort to such procedures, the pre-trial conference should be set x x x x. "
Likewise, it is worth emphasizing that the above-cited decision of the Supreme Court
relied upon by [OLLH] pertains to a civil case filed in the regular court of justice. It
would have been convincing if not plausible if respondent presented the same
Civil Procedure
citation or ruling concerning mode of discovery which was indispensably applied in
administrative case.
Further, it bears stressing that as early as in the case of Angara v. Electoral
Commission, 63 Phil. 139, it was ruled by the Supreme Courtthat "where an
administrative body is expressly granted the power of adjudication, it is deemed also
vested with the implied power to prescribe the rules to be observed in the conduct of
its proceedings.
"Hence, it isbeyond cavil that the Corporation is vested a quasi-judicial power
byvirtue of Section 17 of Rep. Act No. 7875, therefore, it is empowered toprovide its
own rules. Thus, [OLLH] should be wary of the following provisions in the IRR: (1)
Section 96 of its 2004 IRR expressly gives the Arbiter original and exclusive
jurisdiction over all complaints filed with the Corporation in accordance with the Act;
and (2) Section 112 of the same Rules grants said Arbiter the discretion to resolve
the case after the submission of respective position papers of the parties including
any other evidence in support of their claims and defenses or conduct a hearing
when it is deemed necessary. In other words, it is wise and proper for the Arbiter to
follow and adhere to the rules of procedure set forth in this Act which may expedite
the resolution of any case brought to its attention and discard any pleading that may
tend to delay the early disposition of the case for being summary in nature.
Lastly, [OLLH] should be reminded also that the President of this Corporation, who
incidentally is the person to whom the interrogatories are addressed to, albeit being
the top official of the corporation is not the most competent to answer the
interrogatories. The type of questions in the interrogatories point toward issues
arising from and related to the filing and processing of claims, naturally and logically,
the one who is entrusted and tasked to process said claim is the competent person.
The resort to modes of discovery shall be defeated if it is not addressed to the
proper competent party. Indisputably, [OLLH] has already been accredited by the
Corporation for quite some time already that it made this Office wonder why until
now respondent is not yet aware on how a certain filed claim is being processed and
what department of this Corporation is tasked to do the job in order for it to have an
idea to whom it shall address its interrogatories. Be that as it may, this Office
believes that all the issues and queries raised by [OLLH] in its motion may be
addressed in the hearing to be held AFTER submission of its position paper.17
Aggrieved, OLLH elevated the issue to the Court of Appeals via petition
for certiorari. As stated, the CA reversed the Resolution and Orderof the PHIC
Arbitration Department. In ruling that grave abuse of discretionwas committed
when OLLH' s resort to modes of discovery was denied, theappellate court said:
In the case at bench, petitioner OLLH has shown good cause for its resort to the
modes of discovery as the same was anchored on its being able to intelligently
prepare a position paper considering that it was not allowed access to some
pertinent documents or talk to PHIC personnel with regard the charge of filing
multiple claims. Petitioner OLLH also seeks the fullest possible information that are
material and relevant to the case. The subject of the Interrogatories appears to be
relevant and not privileged as they pertain to the procedure being followed by PHIC
in processing and evaluating claims. Petitioner OLLH has also shown the materiality
and relevancy of the document sought lo be produced or inspected - the transmittal
letter and other claims that accompanied the alleged second claim dated June 19,
2007 - which was PHIC's basis for the charge of filing multiple claims against
petitioner OLLH. Verily, petitioner OLLH's resort to modes of discovery was
necessary for the preparation of its defense and the full determination of petitioner
the issue raised in the administrative case.18
Before Us, PHIC contends that Arbiter De Leon did not gravely abuse his discretion
since he merely complied with the rules of procedure governing the exercise of PHI
C's quasi-judicial function. In particular, under Sections 109, 111 and 112 of the 2004
IRR of R.A. No. 7875, an Answer and Position Paper are the only pleadings
recognized and required in the proceedings before the Arbiter. PHIC holds that
OLLH's resort to modes of discovery is not a matter of right as it is provided neither
in the PHIC Charter nor in the IRR, and that even if the Rules may be applied in
suppletory character, the Arbiter may exercise his sound discretion on whether to
resort to modes of discovery consistent with Our ruling in Limos, et al. v. Spouses
Odones. 19
PHIC asserts that OLLH' s overt acts clearly reveal its intent to delay the
administrative proceedings. It stresses that the material points which OLLH seeks to
establish in its resort to modes of discovery were already presented in the pleadings
and documents it submitted for consideration of the Arbiter. Specifically, the subject
information and documents sought to be examined are the same information and
documents which OLLH itself prepared, produced, and submitted to the PHIC.
Civil Procedure
Likewise, the PHIC procedure subject of the interrogatories, apart from being
publicly accessible and already known to OLLH, is immaterial to· the case given
OLLH' s sole defense that it inadvertently attached the wrong document that led to
the processing of two separate claims. Thus, the Arbiter rightly found no further
need to grant such application for being superfluous or redundant.
Before proceeding to the merits of the case, We shall deal with OLLH' s proposition
that the petition should be dismissed outright for PHI C's non-compliance with
Section 5, Rule 7 of the Rules on certification against non-forum
shopping.20 According to OLLH, PHIC Board Resolution No. 695, S. 2004,21 does not
indicate that Alex B. Canaveral, who is the Officer-in-Charge of the Office of the
Senior Vice-President (SVP) for Legal Services Sector (LSS) of PHIC, is duly authorized
to sign the verification and certification against forum shopping at the time of the
filing of the petition on September 20, 2010.22 Having been signed without proper
authorization from the PHIC Board of Directors, the certification is defective and,
therefore, constitutes a valid cause for the dismissal of the petition.
While Resolution No. 695 does not expressly provide for the authority of Canaveral
to sign the verification and certification against forum shopping, the Court notes
that PHIC subsequently submitted as attachments in its Reply PHIC Board Resolution
No. 694, S. 2004, and PHIC Board Resolution No. 1105, S. 2008. Resolution No. 694
designates, among others, the Vice-President for Legal Services Group "to sign on all
verifications and certificates of non-forum shopping of all cases involving the
Corporation, whether to be filed in court, administrative agency or quasi-judicial
body," while Resolution No. 1105 states that the SVP for LSS is one of those officers
authorized "to represent the Corporation in any and all legal proceedings before any
judicial and/or quasi-judicial bodies that may involve the Corporation, including the
signing of initiatory and/or responsive pleadings including all the necessary and/or
incidental legal documents relative to the legal proceedings."23
Following Shipside, Inc. v. Court of Appeals,24which, in tum, was relied upon in the
subsequent cases of Novelty Philippines, Inc. v. Court of Appeals,25 Vicar Int'!
Construction, Inc. v. FEB Leasing & Finance Corp.,26
Alternative Center for Organizational Reforms and Dev 't, Inc. v. Hon.
Zamora,27 Abaya Investments Corp. v. Merit Phils., et al. 28 and BPI v. Court of
Appeals, et al.,29 We, therefore, rule that there is substantial complianceon the part
of PHIC. Aside from the submission, albeit belatedly, of Resolution Nos. 694 and
1105, Canaveral, by virtue of his office, is definitely in a position to verify the
truthfulness and correctness of the allegations in the petition.30
Now, on the issue of whether the CA erred in annulling and setting aside the August
11, 2009 Resolution and September 4, 2009 Order of the PHIC Arbitration
Department, which denied OLLH's resort to modes of discovery, this Court resolves
in the affirmative.
Through written interrogatories, a party may elicit from the adverse party or parties
any facts or matter that are not privileged and are material and relevant to the
subject of the pending action.31 Like other modes of discovery authorized by
the Rules, the purpose of written interrogatories is to assist the parties in clarifying
the issues and in ascertaining the facts involved in a case.32 On the other hand, the
provision on production and inspection of documents is to enable not only the
parties but also the court (in this case, the PHIC Arbitration Department) to discover
all the relevant and material facts in connection with the case pending before it. 33 It
must be shown, therefore, that the documents sought to be produced, inspected
and/or copied/photographed are material or contain evidence relevant to an issue
involved in the action.34
In this case, the questions contained in the written interrogatories filed and received
on July 28, 2009 sought to elicit facts that could already be seen from the allegations
as well as attachments of the Complaint and the Verified Answer. Specifically, the
entries in the three (3) Validation Report that OLLH sought to be identified and/or
explained by PHIC are either immaterial or irrelevant (to the issue of whether OLLH
is guilty of filing multiple claims and OLLH's defense that it inadvertently attached a
second copy of the subject PhilHealth Claim Form 2 to the Transmittal Letter filed on
June 19, 2007) or, even if material or relevant, are self-explanatory and need no
further elaboration from PHIC. Thus, the interrogatories were frivolous and need not
be answered. Aside from this, the PHIC Arbitration Department correctly observed
that the written interrogatories were mistakenly addressed to the President and
CEO of PHIC, who could not competently answer, either based on his job description
or first-hand experience, issues that arose from and related to the filing and
processing of claims.
Civil Procedure
We likewise find as self-serving the allegation of OLLH that its representatives were
denied access to the documents pertaining to the subject PhilHealth claim and, at
the same time, were not allowed to talk to any of the PhilHealth personnel. No iota
of evidence, documentary or testimonial, was submitted to substantiate this
convenient excuse.1âwphi1

As the PHIC Arbitration Department held, all the issues and queries raised by OLLH in
its written interrogatories and motion for production/inspection may be addressed
in a hearing to be held after submission of the position paper of the parties. If the
Arbiter deemed it necessary, based on the required pleadings already submitted g
may be conducted wherein witnesses who testify may be subjected to clarificatory
questions. In such hearing, the Arbiter has the power to issue subpoena ad
testificandum and duces tecum; he may issue subpoenas requiring attendance and
testimony of witnesses or the production of documents and other material/s
necessary. In effect, these serve the same purposes of the modes of discovery.

The foregoing considered, Arbiter De Leon did not commit grave abuse of discretion
in denying OLLH's plea for written interrogatories and production/inspection of
documents. His resolutions were consistent with the summary nature of the
administrative proceedings, expeditiously resolving the case from the perspectives
of time dimension and efficiency dimension.

WHEREFORE, premises considered, the petition is GRANTED. The July 27, 2010
Decision of the Court of Appeals in CA-G.R. SP No. 110444, which reversed the
August 11, 2009 Resolution and September 4, 2009 Order of the Arbitration
Department of the Philippine Health Insurance Corporation that denied Our Lady of
Lourdes Hospital's resort to modes of discovery, is ANNULLED AND SET ASIDE.

SO ORDERED.

DIOSDADO M. PERALTA
Associate Justice